US Department of Education Issues COVID-19 Guidance: The Impact on Federal Student Financial Aid Programs

Higher education institutions across the nation have already taken several steps to help prevent the introduction and spread of coronavirus (COVID-19). To assist in those efforts, the U.S. Department of Education (ED) established a resource page for issues relating to COVID-19, including links to guidance from the Centers for Disease Control and Prevention, the Office for Civil Rights and the U.S. Department of Agriculture. The ED also published a guidance document of particular importance to higher education institutions: Guidance for interruptions of study related to Coronavirus (COVID-19).1

Because many higher education institutions have already undertaken efforts to plan, prepare and respond to COVID-19 in the ways listed on the ED guidance document, this bulletin focuses on the issues raised by the ED’s guidance document related to compliance with Title IV, Higher Education Act policies for students whose activities are impacted by COVID-19. 

At the outset, the guidance makes clear that the ED will provide broad approval for use of online technologies to accommodate students temporarily, without requiring the institution to go through the regular ED approval process, if an institution would be otherwise required to seek that approval. In this broad approval is the ED’s position that it will permit accreditors to waive their distance education review requirements and certain distance learning standards. The guidance also notes that the ED will allow higher education institutions the flexibility to enter into consortium agreements with other institutions on a temporary basis so that students can complete courses at those other institutions but be awarded credit at their home institution.

If a student wishes to take an approved leave of absence for COVID-19-related concerns, the ED will permit the institution to retain those Title IV funds to apply when the student continues enrollment. If the student does not return to complete the program within 180 days, the institution would need to perform a Return of Title IV (R2T4) funds calculation based on the leave-of-absence date. Further showing the ED’s flexibility on this issue, the guidance document provides that the ED will permit institutions to offer courses to students on a non-standard term if the student has been recalled from a travel abroad program or canceled-out of a similar opportunity after the semester began.

The guidance document also discusses COVID-19’s impact on an institution’s Satisfactory Academic Progress (SAP) appeal policy. It specifically reads: “Circumstances related to an outbreak of COVID-19, including, but not limited to, the illness of a student or family member, compliance with a quarantine period, or the general disruption resulting from such an outbreak may form the basis of a student’s SAP appeal even if not specifically articulated in the institution’s SAP policy.” 

The ED’s guidance also tackles what to do if a student is unable to begin attendance at an institution because of COVID-19 issues. In that situation, the ED provides that the institution must return all Title IV grant funds disbursed and all direct loan funds that were credited to the student’s account at the institution for that period. The guidance also discusses the related issue of when a student’s enrollment status changes — e.g., if a student drops below full-time enrollment. It notes that the ED lacks the authority to waive the requirement to award or disburse Title IV funds based on a student’s actual enrollment status. Similarly, if a student withdraws, even for interference caused by COVID-19, the ED does not have the authority to waive the requirement that the institution return unearned Title IV funds.

These are just some of the highlights from the ED’s recent guidance document related to compliance with Title IV, Higher Education Act policies for students whose activities are impacted by COVID-19. Some of the other topics addressed include, but are not limited to, federal work-study, a financial aid administrator’s professional judgment, the length of the academic year and how to define a withdrawal date. 

If you have questions or concerns related to these or any other issues impacting your institution, please contact a member of Taft’s Higher Education practice group.

1The ED also published another guidance document, Interim Guidance for Administrators of US Institutions of Higher Education: Plan, Prepare and Respond to Coronavirus Disease 2019.

Please visit our COVID-19 Toolkit for all of Taft’s updates on the coronavirus.

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