NAICU Washington Update

Senate Republicans Still Negotiating on CARES 2.0

July 24, 2020

With the clock ticking towards the August congressional recess, Senate Republicans worked diligently this week to craft stimulus legislation, dubbed “CARES 2.0,” but fell short of introducing legislation in the face of continued disagreements with the White House. 

Rumors and copies of discussion drafts, which have circulated widely in Washington, show that funding for higher education and liability protection are expected to be included in the Republican proposal for the next round of legislation addressing the pandemic. 


According to the latest intelligence, the framework for the Senate Republican bill includes the following funding elements: 
  • $105 billion for education, including: 
    • $30 billion for higher education.  The higher education funds have no conditions for physically reopening campuses. 
    • $70 billion for K-12 education, including:  $30 billion directly to all public school districts; $30 billion as additional incentive funding to schools that physically reopen; and $10 billion for private schools. 
  • $15.5 billion for National Institutes of Health labs and research.
  • $25 billion for testing.
  • $26 billion for vaccine research distribution and use.
In addition to the funding elements, the bill also may include student loan repayment provisions that ensure “no income; no payment.” 

There are no additional details on these provisions, as negotiations continue within the Republican Party. Discussions between Democrats and Republicans are stalled until Republicans work out their differences. 

It is urgent that presidents continue to communicate with congressional offices on the needs of private colleges. Issues specific to higher education that are still being negotiated include whether funds are distributed to institutions based on the CARES Act formula, which students are eligible, and whether funds are limited for institutions with large endowments. 
  • The CARES Act formula uses FTE, but House and Senate Democrats have put down their marker using headcount, while Senate Republicans remain undecided. Maintaining FTE is significantly better for four-year colleges, both private and public.
  • Student eligibility in the CARES Act was intended to be at the discretion of the institution, but the Department of Education defined the term to include only students who are Title IV eligible. It is unclear if Republicans will address this in their bill, or wait to negotiate with Democrats in the final bill. Defining student as Title IV eligible for the purposes of emergency grant funds in a national crisis leaves out many vulnerable students on private college campuses. In addition to the students who are not U. S. citizens, it would also leave out veterans. Institutions should have the discretion to help the students they know need help during this crisis. 
  • Limiting funds for institutions with large endowments was considered in closed door discussions during CARES Act negotiations, but was rejected as being too hot of a topic to address in a crisis. The issue has arisen once again, but it is uncertain how it will be resolved. The size of an institution’s endowment should not be a proxy for its financial ability to address the unprecedented needs on campus as a result of the pandemic.  
Liability Shield

Liability protection for businesses, including colleges and universities, has consistently been a top priority for Senate Republicans in the next stimulus bill. Under the liability proposal currently circulating on Capitol Hill, the Senate Republican bill would:
  • Create an exclusive federal cause of action for COVID-19 lawsuits against colleges and universities;
  • Require plaintiffs to show that the institutions were grossly negligent or engaged in willful misconduct;
  • Require plaintiffs to show that institutions violated relevant state/local public health guidelines in place at the time the incident occurred; and
  • Place a cap on damage awards.

Although Senate Republicans have insisted that they will not support additional stimulus relief without a liability shield, many Democrats continue to oppose such proposals. As a result, the situation is fluid, and the liability provisions could still change dramatically.

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