• The CARES Act provided $12.56 billion for colleges and universities, which was distributed by the Department of Education based on a formula
  • That formula gave $8.6 billion to Harvard
  • President Trump wrongly accused Harvard of applying for funds earmarked for small businesses

Following widespread criticism, Harvard University said Wednesday it would return $8.6 million in emergency relief funds it was awarded by the Department of Education that had been earmarked to help students facing financial distress as a result of the coronavirus pandemic.

President Trump Tuesday wrongly accused the university of taking the money from the Small Business Administration Paycheck Protection Program fund that was supposed to go to small and midsize businesses. The money actually came from an emergency relief fund for colleges and universities provided by the $2.2 trillion COVID-19 relief package approved March 27.

“Harvard will not accept funds from the CARES Act Higher Education Emergency Relief Fund,” Harvard tweeted.

Trump’s remarks triggered an angry backlash against Harvard, which has a nearly $41 billion endowment. Many angry tweets called the university unethical for applying for the funds and called on the school to dip into its endowment if it wants to help students. Others shamed the university for not discounting tuition after sending students home moving classes online.

The $349 billion SBA program ran out of money last Thursday, less than two weeks after banks began accepting applications. Much of the money went to large hotel and restaurant chains, shutting out the small and midsize businesses it was supposed to help. The Senate voted Tuesday to provide $310 billion more to the fund and Treasury Secretary Steven Mnuchin said the administration would try to recover the funds awarded improperly.

The CARES Act allocated $12.56 billion to higher education. The Department of Education distributed the funds based on a formula, an email to The Fix said.

“In her letter to college and university presidents, Secretary [Betsy] DeVos asked them to determine if their institutions actually need the money and, if not, to send unneeded CARES Act funds to schools in need in their state or region,” education spokeswoman Angela Morabito said in the email. “We hope that the presidents of these schools will take the secretary’s advice and direct CARES Act funds to students in need, no matter where those students are enrolled.”