CARES Act and Higher Education: What Does It Mean for Wisconsin?

June 25, 2020

By Ola Lisowski

Institutes of higher education in Wisconsin will receive more than $544 million in federal relief from the CARES (Coronavirus Aid, Relief, and Economic Security) Act. Together with K-12 schools, education systems in the state will receive an estimated $765 million.

The funding comes from the Education Stabilization Fund (ESF), established through the CARES Act. As a previous analysis detailed, K-12 schools will receive more than $211 million from the ESF. The rest of that fund is split into two portions: direct grants and the Higher Education Emergency Relief Fund.

More than $369 million in grants will go directly to the state or institutions of higher education, according to the Congressional Research Service. Those funds are allocated based primarily upon each college and university’s share of Pell Grant recipients.

Wisconsin will receive almost $175 million for the Higher Education Emergency Relief Fund. At $13.9 billion or 45 percent of total spending, that fund receives the single largest share of education spending in the CARES Act.

Ninety percent of the Higher Education Emergency Relief Fund will be allocated to each institution based on the total enrollment of students who were not exclusively enrolled in remote classes before the pandemic. Another 7.5 percent will go to programs at minority serving institutions, such as Historically Black Colleges and Universities. The last 2.5 percent will go toward the Fund for the Improvement of Postsecondary Education.

Of the 90 percent of funding that will be based on enrollment, the CARES Act requires that three-quarters be sent to schools based on their enrollment of Pell Grant recipients who were not exclusively enrolled in remote classes before the pandemic. The other quarter of spending will be based upon each school’s share of students who  are not Pell Grant recipients and who did not exclusively take remote courses before the pandemic

Pell Grants are need-based grants that go mostly to undergraduate students, based upon “exceptional financial need.”

So far, $35 million has been allocated to institutes of higher education in Wisconsin, and $2 million will be sent to tribal colleges, according to a Legislative Fiscal Bureau report about the Coronavirus Relief Fund. UW-Madison received the most funding, at almost $4 million, followed by UW-Milwaukee, which received $3.4 million.

However, UW-Madison also reported in May that it had received $9.89 million in CARES Act funding for student Emergency Financial Aid Grants. The school disbursed the funding directly to students who applied.