Can We Use Our Student and/or Institutional Share Of HEERF Funds To Make Scholarships To Students?

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No and yes. The following Higher Education Emergency Relief Fund (HEERF) guidance is from the U.S. Department of Education's Supplemental Frequently Asked Questions under Section 18004 of the Coronavirus Aid, Relief, and Economic Security (CARES) Act:

Q&A #5
"Can institutions use the Student Portion of its CARES Act funds under Section 18004(a)(1) for student scholarships?

No. The CARES Act does not allow institutions use the Student Portion of their Section18004(a)(1) funds for student scholarships. Institutions may use the Student Portion of their Section 18004(a)(1) funds only for direct emergency financial aid grants to students, not scholarships.

However, an institution may use the Institutional Portion of its Section 18004(a)(1) award for student scholarships under limited circumstances. Section 18004(a)(1) requires institutions to use Institutional Relief funds only to cover “costs associated with significant changes to the delivery of instruction due to the coronavirus” pursuant to Section 18004(c).

Therefore, if an institution wishes to use the Institutional Portion of its Section 18004(a)(1) award to fund student scholarships, the scholarships must be geared towards these types of costs. Examples of such allowable scholarships for “costs associated with significant changes to the delivery of instruction due to the coronavirus” include covering the cost of fees to access an online library in lieu of a physical library (if such fees are otherwise usually required), providing students with computers and internet access, and subsidizing the added cost of off-campus housing.

Furthermore, it is important that any scholarships funded by the Institutional Portion of a Section 18004(a)(1) award would not count toward the minimum fifty percent of an institution’s total allocation that must be spent on emergency financial aid grants to students for expenses related to the disruption of campus operations due to coronavirus."

Q&A #6
"Can institutions use CARES Act funds under Section 18004(a)(2) or Section 18004(a)(3) to make scholarships to students?

Yes. Section 18004(a)(2) and Section 18004(a)(3) of the CARES Act state that institutions may use funds specifically “for grants to students for any component of the student’s cost of attendance (as defined under section 472 of the Higher Education Act), including food, housing, course materials, technology, health care, and child care.”

More Information: See the following:

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