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DeVos - Getty Images
Education Dive
Federal officials urge wealthy colleges to reject coronavirus aid — some are
Jeremy Bauer-Wolf
April 22, 2020
Dive Brief:
Harvard, Stanford and Princeton universities won't accept millions of
dollars in coronavirus aid amid calls from federal officials for
wealthy institutions to turn down the money.
Education Secretary Betsy DeVos said in a statement Wednesday that
affluent colleges "do not need or deserve additional taxpayer funds."
Half of the roughly $12 billion in federal assistance that colleges can
apply for has been earmarked for students whom the virus has
disadvantaged.
Dive Insight:
President Donald Trump started a firestorm in the higher education
sector on Tuesday following comments he made during a press briefing
that he would push Harvard University to return stimulus money it
received.
Congress passed the $2.2 trillion rescue package last month, setting
aside $14 billion or so for higher ed. Harvard, which has a largely
restricted $40 billion endowment, was allocated $8.7 million of that
funding.
After initially pledging to use all of its federal aid to help students
who were financially strained by the coronavirus, Harvard on Wednesday
backtracked and said it wouldn't accept the funds. It wrote in a
statement that "the intense focus by politicians and others" on the
university's connection with the funding could "undermine
participation" in the relief program.
It also noted "the evolving guidance" from the department, a reference
to colleges' complaints that the agency did not immediately share rules
for giving emergency grants to students.
The university said it hoped the department would first consider
struggling Massachusetts colleges as it redistributes the money. But as
Ben Miller, vice president for postsecondary education at think tank
the Center for American Progress pointed out on Twitter, DeVos doesn't
have to reallocate the funding, and Harvard could have just donated the
money directly to those colleges.
DeVos had said in her statement Wednesday that colleges with large
endowments should not apply for their share of the funding "so more can
be given to students who need support the most."
She had previously urged institutions that enrolled more financially
stable students to consider donating their money to a neighboring
college in need. In a tweet Wednesday, DeVos lauded Stanford for
turning down the $7.4 million it was due to receive in stimulus funding.
Despite that several schools have endowments in the billions, the money
is largely restricted for certain uses and only a set amount can be
drawn upon annually for operating expenses. Further, endowments are
vulnerable to economic contractions and schools rely on that income to
varying degrees.
Stanford tweeted that though the coronavirus has stressed the
university's budget, it turned down the funding because it recognized
the pandemic and its economic impact pose "an existential" threat to
small institutions, which are "a critical part of the fabric of higher
learning."
The university promised students they would still receive financial
assistance, even though it was giving up money that could have been
used for emergency grants.
Princeton announced hours later that it would also reject the federal
money, citing that the school's financial aid packages could provide
"exceptional levels of support" to students.
Princeton also noted that its aid could benefit international students,
as well as beneficiaries of the Deferred Action for Childhood Arrivals
(DACA) program, which protects immigrants who arrived in the country
illegally as children.
The department clarified on Tuesday that only students who are eligible
for federal financial aid can receive the emergency grants — a decision
that excludes international and undocumented students as well as DACA
recipients, much to the chagrin of many higher ed leaders.
Associations and colleges had complained the department was lagging on
distributing the federal funding and that the process was stymied by
little guidance from the department and administrative burdens.
As of Wednesday morning, 2,960 institutions applied for their part of
the $6.2 billion in student emergency grant funding, department
spokesperson Angela Morabito told Education Dive. The department has
given out a total of $751.3 million to 318 of those colleges, she said.
So far, 137 institutions have applied for their share of the other $6.2
billion that can be used to cover colleges' costs related to
coronavirus.
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