The survival of some colleges and universities is part of the media narrative as the coronavirus plague takes a toll across all business sectors.
The federal government has sought to halt the slide into what could turn out to be a financial disaster for many educational institutions.
The U.S. Senate passed a $2 trillion bill in the first quarter that offers a coronavirus relief package of more than $30 billion for education, with more than $14 billion for colleges and universities and at least $13.5 billion for the nation’s K-12 schools.
Money allocated towards the Education Stabilization Fund for K-12 is set to protect jobs, and pay staff while schools are out of session.
The overall spend also included payment for Internet-connected devices and equipment for districts moving to remote learning.
The rescue package also included aid for colleges and universities, many of which are in a dire economic strait, having had to move to conduct classes online or, in some cases shutting down altogether.
At the same time, many schools have decided to refund millions of dollars to students for housing, dining, and other fee-supported services.
Administrators in higher education across the nation worry that the more than $14 billion allocated by lawmakers will not meet their needs.
Many small schools with low endowments are poised to take the biggest hit financially.
This crisis has made the financial situation of many of these colleges more pronounced, given the already low-enrollment and deflated state funding.
Federal funds in the Higher Education Emergency Relief fund should help colleges survive the immediate emergency, but the medium- and long-term prospects for college budgets are still in doubt.
Meanwhile, the Department of Education has suspended all repayments for federally held loans through September 30, 2020.
Students do not have to do anything to get this temporary postponement, — forbearance. No additional interest will accrue during this six-month forbearance period, and non-payment will not affect credit scores.
The Senate bill also allows a funding formula that gives schools with large numbers of Pell Grant recipients more money.
Carol May, Readers Bureau, Fellow
Edited by Jesus Chan
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