Can HEERF Student Grant Funds Be Used To Replace Lost Wages (FWS or Otherwise)?

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This guidance is not award-year-specific and applies across award years.

This AskRegs Knowledgebase Q&A was updated on March 26, 2021 to include NASFAA's understanding as it relates to spending HEERF I student grants under the Coronavirus Aid, Relief, and Economic Security Act (CARES Act), HEERF II funds under the 2021 Coronavirus Response and Relief Supplemental Appropriations Act (CRRSAA, Section 314 of the Consolidated Appropriations Act, 2021), and HEERF III funds under the American Rescue Plan Act of 2021 (ARP). It does not represent a change in guidance.

No. It is NASFAA's understanding that, by definition, lost wages (Federal Work-Study or otherwise) do not constitute actual expenses or costs. HEERF I students funds are specifically intended "to provide emergency financial aid grants to students for expenses related to the disruption of campus operations due to coronavirus (including eligible expenses under a student’s cost of attendance such as food, housing, course materials, technology, health care, and child care)." HEERF II and HEERF III student funds are intended only to cover any cost component of the student's cost of attendance (COA) or emergency costs that arise due to Coronavirus (such as tuition, food, housing, health care, child care, etc.).

In other words, you can award HEERF student grants to cover the actual costs or expenses that the student could not pay because he or she was unable to earn in a Federal Work-Study (FWS) or other job, but you cannot use the grants to replace lost wages for the student or parent.

Reference the Recipient’s Funding Certification and Agreement Emergency Financial Aid Grants to Students under the CARES Act for HEERF I student grant funds and the Coronavirus Response and Relief Supplemental Appropriations Act, 2021 Certification and Agreement (CFDA 84.425E) ((a)(1) Student Aid Portion) for HEERF II student grant funds.

As an alternative under the CARES Act, the school could choose to transfer any of its unexpended FWS funds into its Federal Supplemental Educational Opportunity Grant (FSEOG) fund and replace the FWS with FSEOG under normal awarding rules. The school could also choose to award Emergency FSEOG to these same students to cover any COVID-19 related expenses or unmet need due to the loss of FWS funds. See AskRegs Q&As, How Can Schools Use Campus-Based Funds As Emergency Aid? and Can a School Transfer 100 Percent Of Its Unspent FWS Funds Into FSEOG Due To COVID-19? 

Note: The above guidance relates to awarding HEERF grants to students and not to continuing to pay FWS to students whose FWS employment was interrupted by Coronavirus. For that guidance, see AskRegs Q&A, Can We Continue To Pay FWS Students Who Are Unable To Work FWS Jobs Due To COVID-19? 

AskRegs Q&As represent NASFAA's understanding of regulatory and compliance issues. They are FOR INTERNAL USE ONLY. While NASFAA believes AskRegs Q&As are accurate and factual, they have not been reviewed or approved by the U.S. Department of Education (ED). If you should need written confirmation of AskRegs information for audit or program review purposes, please contact your ED School Participation Division. NASFAA shall not be liable for technical or editorial errors or omissions contained herein; nor for incidental or consequential damages resulting from the furnishing, performance, or use of this material.