State and Federal Legislative Update: March 24, 2020

Federal Legislative Update

Update on COVID-19 package proposals in the U.S. House and Senate

Congressional leaders in the Senate and House are negotiating a large stimulus package referred to as Phase Three legislative response to the COVID-19 emergency. The first phase was approved March 6 and appropriated $8.3 billion emergency spending for authorities fighting the spread of COVID-19. The second phase, the Families First Coronavirus Response Act, was enacted into law on March 18. Negotiations are ongoing, and provisions in the bill are fluid. The details in both the Senate and House bill summarized below are from the Association of Community College Trustees (ACCT) Government Affairs office.  

The Senate bill, known as the Coronavirus Aid, Relief, and Economic Security Act (CARES Act), was introduced by Senate Republicans. House Democrats opposed the bill in its current form. Two procedural votes to move the bill to the floor have failed. Negotiations on this bill are ongoing. The bill includes the following provisions:

• Establish an Education Stabilization Fund and appropriate $20 billion to prevent, prepare for, and respond to coronavirus, domestically or internationally.
• Allocate $6 billion for higher education emergency relief:
• 90% of funds would be distributed to all colleges and universities (public, private nonprofit, and private for profit) using a formula based on 75% of their Pell full-time equivalency (FTE) of students and 25% of non-Pell FTE.
• 5% of funds would be set aside for Historically Black Colleges and Universities (HBCUs) and minority servicing institutions (MSIs).
• 5% of funds would be set aside for Fund for the Improvement of Postsecondary Education (FIPSE).
• Institutions would be able to use these funds to cover any costs associated with campus closure or significant changes to the delivery of instruction due to the coronavirus.
• At least 50% of such funds would be required to provide emergency grants to students for expenses directly related to coronavirus and the disruption of campus operations.
• Provide $2 billion for a state flexibility fund that states could allocate based on the needs of elementary and secondary schools, as well as institutions of higher education in their state.

Other proposed provisions in the bill include:

• Provide the Secretary of Education with broad authority to provide waivers from the Elementary and Secondary Education Act, the Higher Education Act, and the Carl D. Perkins Career and Technical Education Act, except for civil rights laws.
• Allow the Secretary of Education to defer student loan payments, including principal and interest, for three months without penalty to the borrower. Allow the Secretary to defer payments for an additional three months if necessary pursuant to the public health emergency declaration.

After the CARES Act failed to move forward Sunday, March 22, House Speaker Nancy Pelosi announced House Democrats would move forward with drafting their own phase three legislation. This bill was introduced late yesterday and includes the following:

• Establish a State Fiscal Stabilization Fund and appropriate $50 billion to prevent, prepare for, and respond to coronavirus.
• At least 30% of funds would be allocated for public institutions of higher education using a formula based on their share of Pell FTE and non-Pell FTE.
• Institutions could use these funds for education and general expenditures.
• Institutions could also use the funds for grants to students for expenses directly related to coronavirus and the disruption of campus operations (including emergency financial aid to cover housing, food, technology, healthcare, and childcare costs).
• Institutions could use funds for technology and services needed for distance learning and training of faculty and staff.
• Provide an additional $1.5 billion for HBCUs and MSIs.
• Provide $8 billion for FIPSE for public and private nonprofit institutions.
• Institutions that receive funding through the State Fiscal Stabilization Fund would not be allowed to receive additional funds through FIPSE.
• $1 million minimum grants would be for private non-profit institutions.

Other proposed provisions in the bill include:

• Require the Secretary of Education to make payments on behalf of student loan borrowers including those in the Federal Family Education Loan (FFEL), Perkins, and Direct Loan programs for each month during the national emergency period.
• Require the Secretary of the Treasury to make payments on behalf of private student loan borrowers.
• Provide all student loan borrowers with up to $10,000 in debt relief during these monthly payments.   

Other higher education provisions proposed in both bills:

• Waive the institutional matching requirement for campus-based aid programs.
• Allow institutions to transfer unused work-study funds to be used for supplemental grants.
• Allow institutions to award additional supplemental education opportunity grant (SEOG) funds to students impacted by COVID-19.
• Allow institutions to issue work-study payments to student who are unable to work due to work-place closures.
• For students who dropped out of school as a result of COVID -19, exclude the term from counting toward lifetime subsidized loan eligibility, and lifetime Pell eligibility.
• Students impacted by COVID -19, would not be required to return Pell grants or student loans to the Secretary of Education.
• Students impacted by COVID-19 would not have their grades for affected terms calculated into their satisfactory academic progress (SAP) requirements to continue to receive Pell Grants or student loans.
• Waive the requirement that institutions calculate the amount of grant or loan assistance that the institution must return to the Secretary of Education for students who dropped out of school as a result of COVID-19.

State Legislative Update

Walz announces revised supplemental budget

Governor Tim Walz announced a revised supplemental budget earlier this week, allocating an additional $356 million toward the state’s COVID-19 response, to support and protect Minnesotans during this pandemic. Specifically, the funding would provide emergency grants to child care centers; support families struggling financially through the Minnesota Family Investment Program (MFIP); support veterans and their families facing financial burdens; increase funding for food shelves; offer small business loans; and increase resources for Minnesotans struggling with homelessness.

The budget would also create a COVID-19 Minnesota Fund that would give the state government the resources necessary to deploy resources and respond to the needs of Minnesotans in real time. This revised budget proposal leaves $811 million on the bottom line.

The letter submitted to legislative leaders can be found HERE, and the details surrounding the budget can be found HERE.

Given the need to fund requests related to COVID-19, the Legislature may try to convene Thursday. The challenge will be how many legislators will be available. House Speaker Melissa Hortman, DFL-Brooklyn Park, said when the Legislature does reconvene, both parties will ask some members to stay home to keep the Capitol count down.

The Great Minnesota State Disciplinary Get Together

In partnership with faculty leaders, Minnesota State is coordinating an online event Wednesday, March 25, 2020: Keep Teaching through COVID-19, The Great Minnesota State Disciplinary Get Together. This virtual “get together” will consist of a discussion with Minnesota State colleagues regarding the changes coming up, give advice, share resources, and ask questions. The day will consist of sharing online teaching tips and ideas with other colleagues from the same discipline; hearing student voices during a special student panel session over the lunch hour; and the afternoon features several breakout sessions that offer an opportunity to dive deeper into educational technologies, policy and procedures, or equity, mindfulness, and culturally responsive pedagogy. For more information you may view the video at https://minnstate.edu/coronavirus/.