Federal government cancels $ 1.6 billion in capital debt for historically black colleges
|PHOTO | JOHNSON C. SMITH UNIVERSITY|
|Johnson C. Smith University is among 10 historically black college campuses in the Carolinas to have written off capital debt through the United States Department of Education’s HBCU capital funding program.|
The United States Department of Education has paid off the debt of 45 HBCUs participating in the HBCU Capital Funding Program, including 10 campuses in the Carolinas. Thirty-two of the 45 schools are private. Established in 1994, the program enables the country’s 107 HBCUs to access low-cost loans to finance infrastructure improvements.
The Supplementary Appropriations for Coronavirus Response and Relief Act, signed in December by former President Donald Trump, provides funding and authorization to service debts under the capital funding program of the HBCU.
“Our HBCUs have long been on an uneven playing field, financially, compared to many other post-secondary institutions,” Education Secretary Miguel Cardona said in a statement. “This aid will further support these mission-critical institutions and help ensure they have more resources to educate students and graduates during the unprecedented COVID-19 pandemic.”
HBCUs have historically been undercapitalized, particularly by state and federal governments, which has left them on the economic fringes to build campus infrastructure – usually at higher interest rates. Despite these challenges, they earn disproportionate degrees among the country’s black professionals in medicine, law, and STEM. According to the United Negro College Fund, HBCUs generate $ 14.8 billion in economic spinoffs annually, which equates to being ranked among the top 200 U.S. corporations.
“Historically, black colleges and universities have been critical in expanding access to high quality higher education, but they continue to face serious financial challenges that have been made worse by the pandemic,” US officials said. Alma Adams of Charlotte and fellow Democrat Bobby Scott (D -Va.) Said in a joint statement. “The underfunding of HBCUs has literally eroded these institutions. In fact, a 2018 [Government Accountability Office] report found that nearly half of HBCU’s facilities need to be repaired or replaced. “
In combination with the funds provided in the US bailout, signed by President Joe Biden on March 11, and the Coronavirus Aid, Relief, and Economic Security Act, or CARES Act, the HBCUs will also receive more than $ 5 billion per through the Higher Education Emergency Relief Fund. programs. Loans can be used to repair, renovate, build or purchase:
• Buildings such as classrooms, libraries, laboratories or dormitories (including restaurants) used for teaching or research purposes or which house students, faculty and staff;
• A facility for the administration of an educational program, or a student center or student union. No more than 5% of the loan proceeds can be used if the facility is owned, leased, managed or operated by a company that pays the school for its use;
• Technology of teaching materials, research instruments and capital goods;
• A maintenance, storage or utility facility that is essential to the operation of a facility, library, dormitory, equipment, instrumentation, light fixture, a property or interest;
• Institutions that provide outpatient health care to students or teachers;
• Essential physical infrastructure to support projects such as roads, sewage and drainage systems, water, electricity, lighting and telecommunications;
• A facility, equipment or facility essential to maintaining accreditation.
Offloading these debts will help schools focus their resources on supporting students, faculty and staff during the duration of the national COVID-19 emergency. HBCUs can devote more funds to academic innovation and support the socio-emotional development of students.
“This is a major victory for HBCUs and their students,” Adams and Scott said. “We look forward to working with our colleagues to ensure that HBCUs can continue to fulfill and expand their central role in helping students reach their potential. HBCUs are critical infrastructure. “
Carolinian HBCUs will receive debt cancellations:
Allen University, Saint Augustine’s University, Benedict College, Bennett College, Barber-Scotia College, Claflin University, Johnson C. Smith University, Livingstone College, South Carolina State University, Shaw University.