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News

Congress Is Poised to Pass a Coronavirus Stimulus Deal. Here’s What’s in It for Higher Ed.

By Danielle McLean March 25, 2020
Treasury Secretary Steven Mnuchin on Capitol Hill amid negotiations over a stimulus bill prompted by the coronavirus pandemic.
Treasury Secretary Steven Mnuchin on Capitol Hill amid negotiations over a stimulus bill prompted by the coronavirus pandemic.Chip Somodevilla, Getty Images

Congress is poised to give colleges and students whose semesters were upended by the coronavirus pandemic more than $14 billion in emergency relief, according to the text of a spending deal struck on Tuesday night by the White House and the U.S. Senate.

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Congress is poised to give colleges and students whose semesters were upended by the coronavirus pandemic more than $14 billion in emergency relief, according to the text of a spending deal struck on Tuesday night by the White House and the U.S. Senate.

The bipartisan stimulus bill, which is expected to pass both chambers of Congress this week, would give students and colleges more funding than in an earlier bill proposed by Senate Republicans. It would also temporarily suspend student-loan payments over six months, through the end of September.

However, the stimulus funding would fall well short of the $50 billion in federal assistance that nearly a dozen higher-education associations said was needed to keep colleges and students afloat. “While this legislation is an improvement from where the Senate started, the amount of money it provides to students and higher-education institutions remains woefully inadequate,” Ted Mitchell, president of the American Council on Education, said in a written statement on Wednesday.

The stimulus package would allocate more than $6.2 billion each to higher-education institutions and emergency student aid, with nearly $1 billion going to minority-serving institutions such as historically black colleges and universities and tribal colleges. It also would give the Education Department the authority to distribute an extra $300 million to colleges hit hardest by the coronavirus crisis.

Institutions that have more students eligible for Pell Grants would probably receive more funds under the bill, and the funding formula that determines such amounts would exclude all students who worked exclusively online before the disaster.

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The bill would also suspend the payment of student loans through September 30, with the Education Department covering the interest on most federal loans through that period. The plan would temporarily suspend all involuntary collection of defaulted loans, including no wage garnishments and no federal interception of government benefits. (The Education Department had already said it would give borrowers the option of halting payments on student loans for 60 days, and on Wednesday it announced it would stop garnishing wages.)

The Senate bill would not cancel student-loan debt during the coronavirus crisis — a relief proposition touted by Democratic lawmakers but criticized by Republicans. A bill in the House of Representatives would have suspended student-loan payments throughout the crisis, with every borrower having at least $10,000 of debt paid off by the Education Department.

Senate Republicans’ draft version of a coronavirus bill would have provided just $3 billion each in relief to institutions and students. The Democratic-controlled House’s proposal would have provided $15 billion to states to distribute to public colleges — and would have given states discretion on how to divvy up an additional $20 billion between elementary and secondary schools and public colleges. It would have also provided $8 billion to private colleges.

We welcome your thoughts and questions about this article. Please email the editors or submit a letter for publication.
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About the Author
Danielle McLean
Danielle McLean was a staff reporter writing about the real-world impact of state and federal higher-education policies. Follow her at @DanielleBMcLean.
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