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Government Hampers Howard University’s Ability To Pay $31M In Financial Aid

Government Hampers Howard University’s Ability To Pay $31M In Financial Aid

 

Howard University has been placed on a “heightened cash monitoring” list by Education Secretary Betsy DeVos that embarrasses the historically Black university and affects its ability to award financial aid payments in advance to students, Washington Post reported.

The university has been mired in an embezzlement scandal. The embezzlement went on for nearly a decade, university President Wayne A.I. Frederick confirmed in March, according to Huffington Post. At least six employees in the financial aid office were fired.

DeVos’s staff told the school in an Aug. 13 letter that its federal financial aid funds status had been moved to “heightened cash monitoring” or HCM2. That means the school will no longer get millions of dollars in financial aid in advance to award to students. Instead, the school will have to give financial aid to students and then ask for reimbursement from the federal government.

More than $31 million in financial aid is affected, Howard officials said. The majority of students at Howard are on financial aid and almost half qualify for need-based Pell Grants.

Tuition at Howard University for the 2017-2018 school year is $12,061 per semester, not including room and board, according to NBC.

“The new status is a significant hardship for the school for reasons that go beyond the simple embarrassment of being lumped in with dozens of other troubled schools, among them a hair design school in Kentucky,” Washington Post reported. “It will affect the monetary flow to the cash-strapped school, which already depends on a hefty annual allocation from Congress to operate.”

The schools on the heightened cash monitoring list are in severe financial trouble and Howard is the most prestigious among them, The Undefeated reported.

In March, HU Resist, a student-run organization, called for Frederick’s resignation and students scheduled a sit-in to protest lack of transparency among other things, publishing demands for the university, accusing its administrative staff of negligence, and demanding more transparency. Demands included ending “unsubstantiated tuition hikes” and “complete access to administrative salaries.”

Students responded to the news of the financial aid payments in The Undefeated:

“It is very embarrassing to know that Howard University, a prestigious school, is placed on a list with hair salons in Kentucky for misappropriating funds,” said senior accounting major Zaneika McNeil. “It sounds like the university needed to submit documentation to keep us off the list, and they didn’t care to be prompt in their doing so. Over $31 million is being held because Howard and the president basically did not care about the school and the students.”

Howard’s student association president Amos Jackson said the news should not obscure the school’s successes:

“I am disappointed to see our name on the list. However, I believe this will encourage our institution, even more, to hold ourselves accountable to be able to carry out our mission as an institution. I hope The Washington Post and other news outlets cover the continued success of Howard University as they do for our struggles,” Jackson told The Undefeeated.

Here’s an excerpt from the Education Department letter:

“The Department is taking this action as a result of serious administrative capabilities identified in Howard’s compliance audits for award years 2015 through 2017 and during the program review conducted in May 2018. The issues include, among other things, a lack of internal controls, the failure to reconcile Title IV disbursements, the failure to reconcile account records, the failure to ensure students begin attendance and are eligible to receive Title IV funds, the failure to separate the functions of authorizing and disbursing Title IV funds, and the failure to follow Title IV credit balance requirements. In addition, Howard has failed to provide all documentation requested during the resolution of its annual compliance audits and during the recent program review. The Department has determined that these issues warrant moving Howard to the HCM2 method of payment.”

In a letter to the Howard community, Frederick responded:

“Over the past year, Howard University has made significant reforms as well as strengthened both the oversight and accountability within the Office of Financial Aid. The University will continue to partner with Financial Aid Services, and work closely with the Department of Education to ensure Howard students receive best in class service in the administration of Financial Aid. It is important to note that we are taking all necessary measures to avoid any adverse impact on students in the processing of aid and receipt of funds. The entire cabinet and I remain focused on ensuring Howard’s future remains bright and the institution is led with transparency and accountability.”