When the Covid-19 pandemic began more than three years ago, the consensus was that the economic fallout for most colleges would be severe. Not long after, the federal government allocated an unprecedented infusion of cash — $76 billion — to institutions of higher education.
At a time when colleges and students were navigating both a public-health emergency and the pandemic’s financial fallout, the federal funding provided a much-needed buffer.
“For both students and institutions the funding was really a critical lifeline, especially at the height of the pandemic,” said Jonathan Fansmith, senior vice president of government relations for the American Council on Education.
How colleges spent billions in federal relief.
The money, authorized by three different pieces of legislation, was distributed to colleges between 2020 and 2022. For simplicity’s sake, we’ll refer to all of this money as having been distributed through the Higher Education Emergency Relief Fund, or Heerf. Public and private nonprofit colleges received $72.5 billion of that money, and their reports to the federal government form the basis of The Chronicle’s analysis. The data provides insights on what costs colleges prioritized, how they supported struggling students on the brink of dropping out, and which key revenue sources took significant hits. The data also highlights higher ed’s financial, operational, and organizational dynamics, as well as its enrollment patterns.
According to The Chronicle’s analysis, just over 3,000 public and private nonprofit colleges received a portion of the $72.5 billion from Heerf in 2020 and 2021. The bulk of that money, $58.4 billion, went to public institutions, with doctoral institutions garnering the largest share.
The public institutions that received Heerf money in 2020 and 2021 had nearly four times as many students enrolled as the private institutions that did so. Community colleges enrolled the most students among public institutions but received just over a third of the $58.4 billion awarded to public colleges. Doctoral institutions — which enrolled a slightly smaller share of students than community colleges but had significant losses from room and board, athletics, and other assumed costs — received the largest awards per institution, averaging more than $100 million, while community colleges averaged just under $25 million per institution. Among the doctoral universities with the largest amounts of Heerf money: Arizona State University, with $364 million; Indiana University at Bloomington, with $331 million; and Central Florida University, with $314 million.
Private nonprofit colleges received $14.1 billion, with doctoral institutions taking in the largest share of the money going to those institutions. The share may well have been even larger were it not for some well-known institutions that aren’t represented in the data. For instance, Harvard, Princeton, and Stanford Universities — in the wake of public backlash against wealthy colleges tapping into government aid — opted not to accept the funds allocated to them.
Heerf distributions to colleges generally fell into two buckets: money that colleges were required to pass on directly to students, and money that institutions could choose to spend on other purposes, like lost revenue. In 2020, colleges chose to dedicate about $2.4 billion, or nearly half (48 percent) of the money over which they had discretion that year, to satisfy outstanding student balances. Some colleges also chose to use institutional funds to provide additional emergency financial grants to students; this funding for students made up the second-largest percentage of distributions in 2020, at 16.7 percent of total spending that year.
The guidelines around distributions in 2021, however, allowed colleges to use institutional-relief funds to fill in the budgetary holes left by shortfalls in room-and-board revenue, canceled events, or spotty bookstore sales. They spent an average of 61 percent of institutional-relief funds, or nearly $13 billion, on replacing lost revenue, the subject of a separate Chronicle analysis.
These were the institutions that spent the most money in each of the following categories:
The federal government also surveyed colleges about how useful the relief money was. About seven in 10 colleges said the money allowed them to keep faculty members, staff, and other employees fully paid during the pandemic. The share of private colleges and public colleges who said the same was 68 percent and 75 percent, respectively.
The deadline for colleges to spend the money they’ve received is June 30. Some colleges may try to find a way to maintain programs and services the Covid-relief money paid for, Fansmith said. In other cases, the relief money appeared to shore up financial gaps.
Overall, “you could very confidently say this was a real success,” Fansmith said of the relief funds. “There were hiccups, some confusion, and certainly things weren’t as perfect as they could be. But Congress put a plan in place and institutions executed it.”
Methodology
Our analysis excludes for-profit colleges and non-degree-granting private colleges. Those values are included in the summary data provided by the Department of Education, so our values will differ. Some colleges submitted values for multiple campuses as one institution. Discrepancies, errors, and irregularities in the submitted data have been corrected where they have been identified, but some may have persisted.
