HEERF III Compliance: $36 Billion in Federal Higher Education Emergency Funds Now Available, but …

By Timothy Korn, CPA on June, 7 2021
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Timothy Korn, CPA

Senior Manager

Higher Ed Update

Higher Education Emergency Relief Fund III (HEERF III) Offers Relief for Public and Private Non-profit Institutions

On May 11th, 2021, under the American Rescue Plan’s Higher Education Emergency Relief Fund III (HEERF III), the U.S. Department of Education authorized the release and will funnel approximately $36 billion in emergency funds to public and private non-profit institutions.

These funds will continue to provide critical COVID-19 related financial assistance to both students and institutions. It represents the third consecutive round of federal relief monies distributed since the original disbursement passed by Congress through the CARES ACT on March 27, 2020.

HEERF III Restrictions and Compliance Requirements

As with all new rounds of funding there are restrictions and compliance requirements institutions must abide when taking custody and expending these federal funds. The following is a high-level summary of the significant changes to HEERF III compliance requirements:

  • 1.) There are new rules for allowable and disallowed costs relative to the Institutional Portion of grant funds, and requirements for practices to monitor and suppress COVID-19
  • 2.) The formula for determining emergency Financial Aid Grants to Students has been modified
  • 3.) The endowment excise tax has been eliminated
  • 4.) A voluntary process for declining HEERF III funding has been instituted

Care must be taken to adhere to the federal grant guidelines, and to document the institution’s decision-making process for expending grant awards and maintaining proper accounting for all financial transactions.

Grantees must also adhere to two sets of quarterly reporting requirements that now need to be displayed on the institution’s website, as well as annual reporting requirements earmarked to begin in early 2022.

Connect with Freed Maxick’s Higher Education Team

Navigating the complexities of the ‘how, the what, the when, and the who’ to spend your HEERF III grant monies on can be complex and daunting, but Freed Maxick is here to help you navigate as a trusted partner.

Please schedule a complimentary discussion with the Freed Maxick Higher Education Team at 716.336.7067 to ensure all your HEERF III funds are spent in a way that’s meaningful to both your students and your institution.

Resources and References

U.S. Department of Education – ARP: American Rescue Plan (HEERF III)

https://www2.ed.gov/about/offices/list/ope/arp.html 

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