Additional Higher Education Funding Through HEERF

Please note: This blog is current to the date of its publication, Friday, Feb. 19. For additional updates or assistance navigating these uncertain times, please contact us or visit our SST COVID-19 resource page.

On Dec. 27, 2020, President Trump signed the Coronavirus Response and Relief Supplemental Appropriations Act, 2021 (CRRSAA), which created another round of financial aid through the Higher Education Emergency Relief Fund (HEERF and HEERF II). Below, we provide an overview of this update.

For more the Higher Education Emergency Relief Fund (HEERF), click here.

Institutional Funding & HEERF I:

Qualified expenses relate to “significant changes to the delivery of instruction, including interruptions in instruction, due to the coronavirus.”

This phrase is used multiple times in official FAQs about HEERF institutional funds. An institution should ask if the expense is necessitated by significant changes to the delivery of instruction, including interruptions in instruction, due to the coronavirus and document its necessity.

While some items are easy to document (PPE, disinfecting supplies, facility cleaning, etc.), there are a few other expenses that might require more documentation:

  • Payroll expenses
    • For new employees hired, documentation of how their responsibilities relate to the significant changes to the delivery of instruction.
    • For existing employees, document what new responsibilities were taken on that relate to the significant changes to the delivery of instruction, as well as their allocation of additional pay or hours. Only the incremental costs are an allowable reimbursement from HEERF funds.
    • Salaries that are used for Paycheck Protection Program (PPP) forgiveness may not be reimbursed by HEERF funds.
  • Internet, communication and remote teaching expenses
    • Similar to payroll of existing employees, only the incremental expense is an allowable reimbursement from HEERF funds.
    • For a change in expense, documentation of pre-COVID-19 expenses and rates in order to show an increase.
  • Expenses incurred prior to receipt of HEERF funds
    • Necessary expenses on or after March 13, 2020, the date of the Proclamation of National Emergency, may be reimbursed.

Student Funding & HEERF II:

Here are a few key changes that apply to HEERF II:

  • Funding for proprietary institutions only includes student funding, no institutional funding. Public and nonprofit institutions may be eligible for both an institutional portion and a student portion.
  • Institutions are required to prioritize students with “exceptional need.”
  • Students do not need to be eligible for Title IV Federal Student Financial Aid to receive funds.
  • Funds may be applied to student tuition balance if the institution receives written or electronic consent.
  • Institutions that did not receive HEERF I funding under the CARES Act are still eligible to apply for HEERF II funding until April 15, 2021.

Items pending guidance:

  • The application of HEERF II funds to 90/10 ratios for proprietary schools in which written or electronic consent was provided to apply student funds to outstanding student tuition balance.
  • The required audit procedures to be performed for institutions that expend more than $500,000 in HEERF I and HEERF II funds combined or that are on the Heightened Cash Monitoring (HCM) lists during any point of the institution’s fiscal year in which it expended any HEERF grant funds.

For more information regarding HEERF and CRRSAA, as well as for updates on the two above items, check out the trusted resources listed below and explore SST’s COVID-19 response page.

Special thanks to SST Senior Audit Manager Aaron Lohman for providing the content for this post. To schedule a consultation with Aaron, contact him via email today.