Second COVID Stimulus Awards More Than $1.9 Billion to HBCUs in Loan Forgiveness, Recovery Support

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After days of delays, President Donald Trump last night signed a $900 billion aid package that will provide short-term management of the nation’s public health and economic crises related to the coronavirus pandemic. Congress is scheduled to vote today on increasing elements of the package that will provide more resources to families and small businesses nationwide.

The bill also includes significant provisions for colleges and universities nationwide, including historic funding to support federal loan forgiveness and COVID-19 campus recovery efforts at historically Black institutions.

Here are the funding allocations included for HBCUs in the bill:

  • 1.6 billion - Loan forgiveness for participating schools in the federal HBCU Capital Finance Loan Program. According to data from the United Negro College Fund, the program has awarded more than $1.6 billion in support for construction, renovation, and retiring loans to private lenders for more than 43 public and private HBCUs.

  • $271 million — For partial support of Howard University, $251,018,000, of which not less than $3,405,000 shall be for a matching endowment grant pursuant to the Howard University Endowment Act and shall remain available until expended… For an additional amount for “Howard University”, $20,000,000, to remain available through September 30, 2022, to prevent, prepare for, and respond to coronavirus, domestically or internationally, including to help defray the expenses directly caused by coronavirus and to enable grants to students for expenses directly related to coronavirus and the disruption of university operations

  • $48 million — Historically Black College And University Capital Financing Program Account: For the cost of guaranteed loans, $22,150,000, as authorized pursuant to part D of title III of the HEA, which shall remain available through September 30, 2022: Provided, That such costs, including the cost of modifying such loans, shall be as defined in section 502 of the Congressional Budget Act of 1974: Provided further, That these funds are available to subsidize total loan principal, any part of which is to be guaranteed, not to exceed $278,266,000: Provided further, That these funds may be used to support loans to public and private Historically Black Colleges and Universities without regard to the limitations within section 344(a) of the HEA.

    In addition, $16,000,000, to remain available through September 30, 2022, shall be made available to provide for the deferment of loans made under part D of title III of the HEA to eligible institutions that are private Historically Black Colleges and Universities, which apply for the deferment of such a loan and demonstrate financial need for such deferment by having a score of 2.6 or less on the Department of Education's financial responsibility test: Provided, That the loan has not been paid in full and is not paid in full during the period of deferment: Provided further, That during the period of deferment of such a loan, interest on the loan will not accrue or be capitalized, and the period of deferment shall be for at least a period of 3-fiscal years and not more than 6-fiscal years: Provided further, That funds available under this paragraph shall be used to fund eligible deferment requests submitted for this purpose in fiscal year 2018: Provided further, That the Secretary shall create and execute an outreach plan to work with States and the Capital Financing Advisory Board to improve outreach to States and help additional public Historically Black Colleges and Universities participate in the program.

    In addition, $10,000,000, to remain available through September 30, 2022, shall be made available to provide for the deferment of loans made under part D of title III of the HEA to eligible institutions that are public Historically Black Colleges and Universities, which apply for the deferment of such a loan and demonstrate financial need for such deferment, which shall be determined by the Secretary of Education based on factors including, but not limited to, equal to or greater than 5 percent of the school’s operating revenue relative to its annual debt service payment: Provided, That during the period of deferment of such a loan, interest on the loan will not accrue or be capitalized, and the period of deferment shall be for at least a period of 3-fiscal years and not more than 6-fiscal years.

    In addition, for administrative expenses to carry out the Historically Black College and University Capital Financing Program entered into pursuant to part D of title III of the HEA, $334,000.

  • $10 million — For expenses necessary in carrying out the National Historic Preservation Act (division A of subtitle III of title 54, United States Code), $144,300,000…$10,000,000 is for grants to Historically Black Colleges and Universities

  • $4 million — Apportionment to HBCUs under Broadband Internet Access Service section… provided that not less than 40 percent of the amount of the grants made under the Pilot Program are made to Historically Black colleges or universities

  • $2 million — To establish an Agriculture Business Innovation Center at one HBCU.

HBCUs will also be target institutions for grantmaking opportunities in the establishment of the National Museum of the American Latino, fellowship programs in national intelligence and cybersecurity, and partnerships with the Central Intelligence Agency.