Dive Brief:

• After several weeks of uncertainty, the U.S. Department of Education has determined that unauthorized and international students can't get federal coronavirus relief, according to an emergency regulation the agency issued Thursday.

• The "interim final rule" restricts Coronavirus Aid, Relief, and Economic Security (CARES) Act grants to students who are eligible for Title IV aid, which would exclude those populations.

• Higher ed leaders have complained that the department hasn't clearly defined limits on use of the money, which has made it difficult for them to distribute it to students.

Dive Insight:

The CARES Act sets aside more than $6 billion that colleges must pass to students disadvantaged by the coronavirus in the form of emergency grants. When Education Secretary Betsy DeVos began releasing the grant funds in early April, she did not specify that unauthorized students would be ineligible for the money. Nor did Congress explicitly state in the legislation that certain students would be blocked from getting grants.

However, the department interpreted that lawmakers only meant for grants to be distributed to students who are eligible for Title IV aid, the agency wrote in the rule.

The CARES Act doesn't define a "student," the department wrote, but the law does contain several references to the portion of the Higher Education Act that outlines Title IV. Department officials took this to mean that only Title IV-eligible students could get the grants.

"It's clear the CARES Act was written to help Americans recover from the coronavirus pandemic," DeVos said in a statement. "U.S. taxpayers have long supported U.S. students pursuing higher education, and this rule simply ensures the continuity of that well-established policy."

The rule was met with bitter backlash. 

"Many colleges and universities have already established plans and procedures to distribute their emergency aid funds," Ben Miller, vice president for postsecondary education at the Center for American Progress, a left-leaning think tank, said in a statement. "Now, they'll have to change course yet again to comply with DeVos' confusing, unnecessary, and exclusionary guidance going forward."

Administrators and other sector leaders have lambasted the department for its handling of the CARES funding. Less than two weeks after the money started to go out to colleges, the department published guidance stating that only Title IV-eligible students could receive the grants. 

A month later, however, the department walked back that guidance. In a notice on its website, the department stated it could not legally enforce the directive, spurring more confusion among institution officials. 

Policy experts said the backtracking was likely in response to a lawsuit over the restrictions brought against the department in mid-May by California's community colleges. Washington state has filed a similar lawsuit.

In a court filing this week, the department said the rule would not likely be ready until at least June 15. About $11 billion of CARES funding has been allocated to institutions, the rule states. The law sets up $6 billion or so for colleges to address their coronavirus expenses. 

"There's a lot of internal turmoil on this," said Clare McCann, deputy director for federal higher ed policy at left-leaning think tank New America, noting that the department is on stronger legal footing enforcing its restrictions through a rule rather than nonbinding guidance.  

Colleges have been eager to get the grants to students, many of whom have been struggling financially because of the virus. Some institutions had already received their cut of the grant funding by the time DeVos first told colleges that unauthorized students, including participants in the Deferred Action for Childhood Arrivals (DACA) program, weren't eligible to receive it. However, the rule notes that colleges won't be retroactively punished for giving the funds to students who don't qualify for Title IV aid.

Students who haven't filled out a Free Application for Federal Student Aid (FAFSA) may be hamstrung getting a grant, however, because it's the easiest way for their colleges to determine Title IV eligibility, said Dan Madzelan, associate vice president for government and public affairs at the American Council on Education (ACE). 

Many colleges may require students to complete a FAFSA to get a grant, McCann said. While schools can also set up their own system for figuring out Title IV eligibility, that process could be cumbersome. The FAFSA checks certain Title IV criteria, such as whether students have a qualifying drug conviction or are in default on a federal loan, both of which prevent them from qualifying for Title IV aid.

The department considered waiving these eligibility restrictions but ultimately decided doing so "would not be fair across groups of students."

The rule will be published in the Federal Register Monday and will be open to public comment for a month. The department waived the typical notice and comment period, citing the turbulence of the pandemic.