President Trump made information yesterday in his each day coronavirus briefing when he stated that Harvard College must pay again the almost $9 million it’s going to obtain from the CARES Act. “They shouldn’t be taking it. When I saw Harvard—they have one of the largest endowments anywhere in the country, maybe the world. They’re going to pay back the money,” Trump stated. However he bought a number of issues mistaken.
First, Trump insinuated that Harvard College acquired the cash below the Paycheck Safety Program (PPP) — a loan program for small companies, a portion of that are forgivable. The White Home Twitter account even tweeted the video of his feedback and added, “they will not keep money intended for small business loans.”
However that isn’t true.
The cash Harvard acquired from the CARES Act was from the Training Stabilization Fund that helped establishments of upper schooling. It’s receiving a portion of the roughly $14 billion Congress allotted to greater schooling and didn’t draw from the identical pool of funds small companies did, because the White Home tweet says.
The Training Stabilization Fund cash is allotted to establishments via a formulation based mostly on their share of scholars not completely on-line, with a weighted desire to varsities serving bigger percentages of Pell Grant college students. At the least half of the funds going to establishments should go to college students within the type of emergency grant support. Harvard has stated it’s going to use the entire funds to offer monetary help to college students.
As a non-profit, Harvard might have utilized for the PPP loans but it surely didn’t. Many non-profit schools—and sure some for-profits—have utilized and acquired cash.
Actually, it’s truthful to ask why establishments with giant endowments and huge sources are receiving cash. Many would say that cash ought to go to public neighborhood schools first. They undoubtedly want the cash extra.
It appears a part of the problem was the Congress opted for simplicity, quite than excluding sure sectors or having Secretary DeVos resolve who will get funds and who doesn’t. But it surely’s vital to keep in mind that, though Harvard has many college students from rich households, Harvard’s college students aren’t proof against the impacts of the coronavirus.
It’s also not as easy, as some have instructed, for colleges to make use of their endowment cash to cowl bills. Endowment funds are sometimes restricted and arduous to entry. Plus, with the financial fallout of the coronavirus many schools have seen main losses of their endowments.
But it surely’s additionally unclear why President Trump selected to single out Harvard. Faculties just like the College of Pennsylvania—his alma mater—have giant endowments and bought related quantities of cash. Liberty College, a non-public faculty run by the staunch Trump supporter, Jerry Falwell, acquired greater than $15 million in CARES Act funds. And for-profit schools just like the College of Phoenix had been included. It acquired almost $7 million after agreeing to pay tens of millions in an FTC settlement. (Phoenix additionally says it’s going to use 100 p.c of the cash for direct monetary help for college students, although it’s unclear how it’s doing so.)
Establishments have already requested for extra money within the subsequent spherical of coronavirus aid. This scrutiny might change the way in which Congress allocates any extra funds that go to greater schooling. Many could be happy if the funds excluded all non-public schools, particularly for-profits.