HEERF III is Finally Here – Some Administrative Reminders

The following is a brief summary of some of the more significant questions that were answered by the U.S. Department of Education (Department) when they published new frequently asked questions (FAQs) in conjunction with the student aid portion of the funds now available under the American Rescue Plan Act (ARP).

All previous FAQs still apply, unless directly superseded by a subsequent FAQ. It’s important to carefully review all FAQs, as these documents have not been carried forward into the current document.

How long do I have to spend the various Higher Education Emergency Relief Fund (HEERF) funds I received?

Institutions generally must expend their HEERF grant funds within one year from the date the Department processed the most recent obligation of funds for each specific grant. Thus, institutions that received a supplemental award under ARP have one year to spend all remaining funds authorized by Coronavirus Response and Relief Supplemental Appropriations Act, 2021 (CRRSAA) (Pub. L. 116-260), the Coronavirus Aid, Recovery, and Economic Security Act (CARES Act) (Pub. L. 116-136), and new ARP funds for each grant from the date their ARP supplemental award is made. The specific period of performance will be indicated in Box 6 of your institution’s Grant Award Notice (GAN).

The Department understands that some grantees—even given the emergency nature of the HEERF grant—may be unable to expend funds by this time. Consequently, no-cost extensions (NCEs) of up to 12 months are available, as provided for in 2 CFR § 200.308(e)(2). NCEs extend a grant’s period of performance. NCEs may not be exercised merely for the purpose of using unobligated balances.

Given the emergency nature of HEERF grants, the Department encourages grantees to use their awards to cover expenses associated with the coronavirus as they arise and not hold off on doing so.

When should I draw my funds via the G-5 platform?

HEERF grantees are under an obligation to minimize the time between drawing down funds from G5 and paying obligations incurred by the grantee (liquidation). The Department may evaluate for compliance with the rule grantees who have not drawn down the funds from G5 and not paid the obligations (the emergency financial aid grants to students) to the students within 15 calendar days.

When must I draw a portion of the funds?

Institutions that receive an ARP (a)(1) or (a)(4) supplemental award(s) must draw down any amount of its grant funds within 90 days of the date of each supplemental award. Failure to draw down any amount of the institution’s award(s) may constitute nonacceptance of the terms, conditions, and requirements of the Supplemental Agreement and the Department may choose to deobligate and redistribute the ARP supplemental grant funds or take other appropriate administrative action, up to and including terminating the grant award pursuant to 2 CFR § 200.340. Please note this requirement is the same as it was for CRRSAA (a)(1) supplemental awards.

When is the earliest time my institution can charge expenses to these grants?

Institutions may charge expenses associated with coronavirus (pre-award costs) that were incurred on or after March 13, 2020, the day the national emergency was declared due to the coronavirus, to their ARP awards.

I received a notification about excessive cash draw down; what does that mean?

This notification is triggered when grantees draw down large balances, instead of gradually throughout the entire length of their performance periods. Because of the nature of the HEERF grant program, some institutions may have a large expense that requires a drawdown of all or most of their HEERF grant funds at once. For example, if an institution has determined which students will receive emergency financial aid grants, it may incur an expense for all or most of its (a)(1) Student Aid Portion grant. Once an institution has incurred these valid obligations (as opposed to drawing down funds in advance of need), a large drawdown in your HEERF grant may prompt G5 to send an automated “Excessive Cash Drawdown” email.

My institution has spent all of the HEERF funding. Are there additional steps I need to take with the Department to close out the grants?

  • Contact the ED Program Contact listed in Box 3 of your GAN.
  • Ensure that they have liquidated remaining funds for expenditures incurred during the grant period of performance. Per recent changes to the Uniform Guidance, institutions now have 120 calendar days to liquidate all financial obligations incurred under the award after the period of performance.
  • Ensure that all quarterly reporting is properly publicly posted online and submitted to the Department as required by the HEERF Quarterly Reporting requirements. Additionally, public quarterly reports should remain online for at least three years after the submission of the last quarterly or annual performance report.
  • Submit the annual performance report covering the last period of grant performance when the Department opens the system for annual performance reporting (the next annual performance report will be submitted in early 2022).
  • Maintain all grant financial records, supporting documents, statistical records, and all other entity records pertinent to the HEERF grant award for a period of three years from the date of submission of the last quarterly or annual performance report per 2 CFR § 200.334.
  • Submit all required audits as described in Question 38 and the Department’s HEERF Grant Program Auditing Requirements Letter (issued on March 8, 2021).

There are a lot of FAQs out there. Which are still applicable as of right now?

The following FAQ documents remain, in whole or in part, applicable to the HEERF III ARP programs (unless superseded by the text of ARP):

The Department intends to consolidate all applicable HEERF FAQs into a single document soon for ease of program administration and compliance.

You can read the full set of FAQs from the Department here.

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