Dear Commons Community,
Yesterday the news cycle was completely taken over for coverage of the $2 trillion federal stimulus package designed to help individuals, hospitals, state and local governments, and small and large businesses weather the coronavirus. It also includes funds 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. Some of this might still change as the final wording is worked out and enacted.
The new stimulus bill, which is expected to pass both chambers of Congress this week would also temporarily suspend student-loan payments over six months, through the end of September. Here is further analysis courtesy of The Chronicle of Higher Education.
“,… 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.
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.”
My thinking is that this is a step in the right direction. How much more our colleges and universities will need will depend upon how long the pandemic lasts.