Devine Millimet | NH Law Firm

The CARES Act- How Will it Impact Educational Institutions and Students?

Kerry Battles, Esq.
Keelan Forey, Esq.

April 7, 2020

The recent economic bill titled, “Coronavirus Aid, Relief, and Economic Security (CARES) Act” (the “Act”) was signed into law by President Donald J. Trump on March 27, 2020.  Among other things, the Act created an Education Stabilization Fund (the “Fund”) with $30.75 billion dollars in relief for kindergarten through twelfth grade schools (“K-12 schools”) and higher education institutions. In addition to the Fund, the Act contains several provisions to offer support and relief to K-12 schools and higher education institutions. This Alert summarizes some of the key provisions of the Act that apply to these institutions and their student population.

Education Stabilization Fund

The Fund provides $30.75 billion in emergency funding for education through September 30, 2021.  Almost $3 billion of the Fund will be allocated by the United States (U.S.) Department of Education to state Governors in accordance with section 18002 to support K-12 schools and higher education institutions.  Importantly, these funds will not be restricted to just public institutions, rather Governors may allocate funds in accordance with section 18002 (c)(3) to support institutions of higher education, K-12 public boards of education or other public authority, or an “educational related entity” within the state that the Governor deems essential for carrying out emergency educational services to students. In addition to the funds allocated to state Governors, the U.S. Department of Education will distribute additional funds directly to K-12 schools and higher education institutions. Under section 18003 almost $13 billion will be allocated to the state-level government organization within each U.S. state or territory responsible for education to support K-12 schools (including charter schools) through providing sub grants.   In New Hampshire, the funds distributed pursuant to 18003 will be distributed to the New Hampshire Department of Education (“NH DOE”).  Under section 18004 almost $14 billion will be allocated by the U.S. Department of Education to higher education institutions through the same system as the U.S. Department of Education otherwise distributes funding to each institution pursuant to title IV of the Higher Education Act of 1965.

The U.S. Department of Education has not provided formal guidance to schools or states concerning the details of the process and timing of when it will be sending this funding.  Although no formal guidance has been issued, the NH DOE has anticipated what the procedure may be for disbursing New Hampshire’s funds (see   NH DOE anticipates that the funds will be delivered through the state’s online grants management system and will provide further guidance on allowable activities and expenditures.

K-12 School Waivers

Section 3511 of the Act provides for “national emergency educational waivers” for K-12 schools.  A state educational agency, most commonly the state’s board of education (and sometimes a local educational agency, i.e., the public board of education in a town, city or school district) or Indian tribe, may request a waiver from the Secretary of the U.S. Department of Education. To streamline the process to obtain a waiver, the U.S. Department of Education has provided a template for state educational agencies to request a waiver (see

The waivers are for certain statutory or regulatory requirements under federal law and are listed in section 3511(b)(1) and (b)(2). Most of these statutory or regulatory waivers stem from assessment, accountability, and reporting requirements under the Elementary and Secondary Education Act (the “ESEA”). Specifically, states may request a waiver from ESEA regulations regarding the 15% carryover limitation for Title I, Part A funds; a needs assessment to justify the use of funds; content-specific spending requirements; spending restrictions on technology infrastructure; and the definition of “professional development” which can limit the ability to quickly train teachers on effective distance learning techniques. If the Secretary determines that the requested waiver is “necessary and appropriate,” then the request is approved.  Generally, requests for waivers to the Secretary shall be approved or disapproved no later than thirty days after submitted.

State educational agencies (or local educational agencies and Indian tribes) that do not use the template provided by the U.S. Department of Education may still submit a waiver request and must comply with the requirements listed in section 3511(c), which requires that the applicant:

  • Identify the federal programs affected by the request waiver;
  • Describe which federal statutory or regulatory requirements are to be waived;
  • Describe how COVID-19 prevents or otherwise restricts the ability of the educational agency from complying with such statutory or regulatory requirements; and
  • Assure that that the educational agency will work to mitigate negative effects, if any, which may occur as a result of the requested waiver.

Under this same section of the Act, the Secretary must report to Congress within thirty days about any additional waivers that may be needed in order to provide “limited flexibility” to state and local educational agencies to meet the needs of students during the emergency related to the coronavirus. These waivers can extend beyond the ESEA to potentially include other federal laws that impact education. Thus, K-12 schools will likely have additional waiver relief options available to them in the next month.

Higher Education Institution Waivers and Deferral of Federal Loan and Interest Payments

The Act provides relief and flexibility to both federal student loan borrowers and higher education institutions during the emergency related to the coronavirus. For example, section 3513 defers federal loan and interest payments for federal student loan borrowers until September 30, 2020. To determine whether a loan is eligible, the United States Department of Education recommends contacting the loan servicer online or by telephone to determine eligibility. Private student loans, however, are not covered by the Act. Higher education institutions may also convert unused work-study funds into grants or continue to pay work-study students during the period of time (not to exceed one academic year) in which affected students are unable to fulfill a work-study obligation for all or part of such academic year during the emergency as a result of COVID-19.  Section 3503 of the Act also waives the federal match requirement for higher education institutions with respect to funds made available for award years 2019-2020 and 2020-2021.

Remote Learning, Internet Access, and Technology

With many schools closed under governors’ orders, parents, students, educators, and advocates of the education industry pushed for specific funding to help schools that are unable to meet remote learning demands, including funding for students who may not have internet access or internet accessible devices. Although the Act does provide for purchasing educational technology (including hardware, software, and connectivity for students who are served by the local education agency) and for the planning and coordination of providing technology for online learning to all students, the Act does not designate specific funding to address internet needs. However, the $13 billion allocated to K-12 schools will give local educational agencies broad discretion in deciding how to use the funds. This could include purchasing such technology and providing internet access for students. While it remains to be seen, many believe that Congress will pass additional emergency funding measures in the coming months, and specific funding for remote learning may be incorporated into a future funding package.

Depending on the school or institution, the CARES Act offers unique opportunities for flexibility and relief during this COVID-19 emergency. Importantly, the impact of the Act on the education industry focuses largely on public education. However, the focus could change when the Secretary presents Congress with additional waiver recommendations that extend beyond the ESEA. Members of the education industry should understand how this Act can help meet the needs of their students and institutions during these unprecedented times. If you have a question about how the CARES Act impacts students and educational institutions, please call Kerry Battles at (603) 695-8664.

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