Feds allocated $12.5 billion in pandemic aid for universities, but some say no thanks

Bad optics and awkward politics have forced several elite American universities to reject significant amounts of federal emergency student funding granted to them under the massive coronavirus relief package, with the schools promising to pay the students themselves rather than use government funds. 

The CARES Act, passed into law in late March, allocated a staggering $2 trillion in relief funds for American taxpayers, small businesses, states and local governments. Roughly $14 billion of that was earmarked for distribution to American colleges and universities, with much of that money meant to assist the students whose semesters were almost wholly disrupted by the wave of campus closures that swept the nation last month. 

The U.S. Education Department has already created an 85-page document dividing up some $12.5 billion in aid to schools both famous, like Yale University ($6.58 million), and lesser known, like York County Community College ($556,529). You can review the full list here.

Education Secretary Betsy DeVos told university presidents in a letter earlier this month that at least half of the money schools received under the law "must be reserved to provide students with emergency financial aid grants to help cover expenses related to the disruption of campus operations due to coronavirus." The government is allowing institutions "significant discretion" to determine how to distribute those funds.

The amount each school will receive, DeVos said, was determined "using a formula based on student enrollment." Schools did not have to apply for the funding, though they had to agree to the government's terms before accessing them. 

Facing criticism, wealthy schools reject funds

Because the program awarded funding regardless of whether a school applied for it, most colleges or universities nationwide appear to have been allocated at least some emergency aid from the government. 

Yet that has resulted in an awkward image problem for a select group of institutions: Ivy Leagues and other top-tier universities have received funding right along with state-level schools and technical colleges. Harvard, for instance, received over $8.6 million; Stanford received nearly $7.4 million. Princeton University, the second-smallest Ivy League by undergraduate enrollment, received $2.4 million. 

These schools, which have topped the upper echelons of American education for generations, also possess considerable endowments. Harvard's is the largest in the world at $40 billion; Stanford's is nearly $30 billion. 

Schools indicate they will provide out-of-pocket aid for students

These well-funded universities have faced sharp criticism for accepting federal money while maintaining such rich coffers, leading many to publicly refuse to take the tax dollars.  

Harvard spokesman Jason Newtown provided Just the News with the university's statement on Thursday night. "We have previously said that Harvard, like other institutions, will face significant financial challenges due to the pandemic and economic crisis it has caused. We are also concerned, however, that the intense focus by politicians and others on Harvard in connection with this program may undermine participation in a relief effort that Congress created and the President signed into law for the purpose of helping students and institutions whose financial challenges in the coming months may be most severe."

"As a result of this, and the evolving guidance being issued around use of the Higher Education Emergency Relief Fund, Harvard has decided not to seek or accept the funds allocated to it by statute," the statement continued. 

The school added that it "remains fully committed to providing the financial support that it has promised to its students."

That sentiment was echoed by numerous universities this week. Princeton announced on Twitter that it would "not accept funding allocated under the CARES Act," but that the school "remain[s] committed" to using its financial aid system to helping its students. Yale said in a statement on its website that it would reject the federal funds but that "this decision will in no way diminish our financial support for them at this critical time."

Stanford also announced it would decline the federally allocated funds, but that "since half of these funds were to be directly applied to grants for students, we want to reassure our students that we remain fully committed to the financial aid that has been promised to them."

'We're going to give it all to our students'

Lynchburg, Virginia's Liberty University received among the more sizable allocations from the government, having been granted over $15 million for its students. The school's president, Jerry Falwell, Jr., said that though the school is entitled to keep half of that money, it intends to distribute "every penny" of it to students. 

"Any money we receive we're going to give it all to our students. If they say we can't give it all to our students, we're not going to take it," Falwell told Just the News on Thursday evening.