Local & State
|Feds cancel $1.6 billion in capital debt for historically Black colleges|
|45 campuses, including JCSU, will benefit|
|Published Friday, April 2, 2021 6:00 pm|
|PHOTO | JOHNSON C. SMITH UNIVERSITY|
|Johnson C. Smith University is among 10 historically Black college campuses in the Carolinas to have capital debt canceled by the U.S. Department of Education's HBCU Capital Financing Program.|
The U.S. Department of Education discharged debt among 45 HBCUs participating in the HBCU Capital Financing Program, including 10 Carolinas campuses. Thirty-two of the 45 schools are private. Established in 1994, the program provides the nation's 107 HBCUs access to low-cost loans for financing infrastructure improvements.
The Coronavirus Response and Relief Supplemental Appropriations Act, signed into law in December by former President Donald Trump, provides funding and authority to discharge debts under the HBCU Capital Financing Program.
“Our HBCUs have long been on an uneven playing field, financially, as compared to many other postsecondary institutions,” Education Secretary Miguel Cardona said in a statement. “This relief will further support these mission-critical institutions and help to ensure they have more resources to educate and graduate students during the unprecedented COVID-19 pandemic.”
HBCUs have historically been undercapitalized, especially by state and federal governments, which left them on the economic margins to build campus infrastructure – usually at higher interest rates. Despite those challenges, they graduate disproportionate rates of the nation’s Black professionals in medicine, law and STEM-related fields. According to the United Negro College Fund, HBCUs generate $14.8 billion in economic impact annually, which equals a ranking among the top 200 largest U.S. corporations.
“Historically Black Colleges and Universities are essential to expanding access to high-quality higher education, but they continue to face severe financial challenges that have been made worse by the pandemic,” U.S. Reps. Alma Adams of Charlotte and Democratic colleague Bobby Scott (D-Va.) said in a joint statement. “Underfunding of HBCUs has quite literally eroded these institutions. In fact, a 2018 [Government Accountability Office] report found that nearly half of HBCU facilities need to be repaired or replaced.”
In combination with funds provided in the American Rescue Plan, signed by President Joe Biden on March 11, and the Coronavirus Aid, Relief, and Economic Security Act, or CARES Act, HBCUs will also receive more than $5 billion through Higher Education Emergency Relief Fund programs. The loans can be used to repair, renovate, build or buy:
• Buildings such as classrooms, libraries, laboratories or dormitories (including dining facilities) used for instructional or research purposes or housing 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 loan proceeds can be used if the facility is owned, leased, managed, or operated by a business that pays the school for its use;
• Instructional equipment technology, research instruments and capital equipment;
• A maintenance, storage, or utility facility that is essential to operation of a facility, a library, a dormitory, equipment, instrumentation, a fixture, property or an interest;
• Facilities that provide outpatient health care for students or faculty;
• Physical infrastructure essential to support projects like roads, sewer and drainage systems, water, power, lighting, and telecommunications;
• A facility, equipment, or fixture essential to the maintaining of accreditation.
Discharging these debts will help the schools focus their resources on supporting students, faculty, and staff for the duration of the COVID-19 national emergency. HBCUs can dedicate more funds to academic innovation, and supporting students’ socio-emotional development.
“This is a major victory for HBCUs and their students,” Adams and Scott said. “We look forward to working with our colleagues to ensure HBCUs can continue to fulfill and expand their pivotal role in helping students reach their potential. HBCUs are essential infrastructure.”
Carolinas HBCUs to receive debt discharges:
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.
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