COVID-19 Resources: Supporting Students, Families, and Staff
This post provides information on what you may need to be thinking about in the areas of finance, student data, human resources, student meals, and technology as a result of COVID-19. We will continue to update this as we have more information. If there are specific questions you would like to see answered that you do not see below, please reach out to your EdOps Specialist.
DISCLAIMER: EdOps does not provide legal or tax advice. Consult an attorney or tax accountant for specific questions.
Finance
Date last updated: May 14, 2020
Q: Can we (as a 501(c)(3)) provide funds to families of students who are facing significant personal challenges?
A: The answer is generally yes, although with some limitations. Schools are not recognized as an organization that makes grants to individuals in need so grants to individuals do not really fit within the purpose for which you are exempt. However, a charity may make grants to needy individuals as a charitable activity, and the IRS is unlikely to challenge an occasional gift to a needy family.
Furthermore, disaster relief isn’t the exempt purpose for a school’s non-profit organization, and providing significant funds may jeopardize its tax-exempt status. Since a federal state of emergency was declared on March 13, it is possible for a standard non-profit organization to make disaster relief payments to families without jeopardizing its exempt status and without it being taxable to a student or family.
Such relief/aid will be required to be reported on the 990, explained to the IRS, and noted in a financial audit. Recordkeeping requires documentation of the type of assistance, criteria for disbursements, date and place of disbursements, number of victims assisted, charitable purpose, and cost of aid. Additionally, a disaster relief selection committee should be established to ensure oversight over the distribution of funds.
In summary, you will likely not run into issues with the IRS as long as the amount of funds distributed is immaterial; however, if you plan to distribute a significant amount of funds, we strongly suggest that you contact both your auditor and a tax attorney.
Note that you may run afoul of the IRS if you try to provide (non-taxed) payments to staff.
Additional resources: Disaster Relief Resources for Charities and Contributors
Q: Can we solicit funds, and then donate them to families of students?
A: Schools may collect funds for a specific purpose (e.g., COVID-19). However, you should be explicit that someone who gives money to your organization in order to help a specific family is NOT able to claim a charitable contribution deduction for the amount given. A gift to, or earmarked for, the benefit of a specific individual or family is not deductible by an individual because individuals cannot claim a charitable contribution deduction unless they give to a qualifying entity. Even if a donor contributes to a charity’s fundraiser, if the fundraiser is for the benefit of a specific family, the donor is considered to have made the gift directly to the family because it is earmarked for the family.
Q: How can we distribute funds to families of students?
A: If your school is providing support, the money should not come from government funds. You must track revenue and expenses in a way to ensure only private funds are used for providing support to students, families, and staff. Ensure that whatever method you use (e.g., checks, gift cards, prepaid cards) is being tracked in detail.
Q: How are these funds taxed for the recipient?
A: Donations to students or families are generally not taxable income.
If providing donations to staff, schools must document that no service or work was provided so to avoid misreporting an employees’ annual income. Additionally, keeping individual donations below $600 limits the risk of donations being misconstrued as earned income. Note that you may run afoul of the IRS if you try to provide (non-taxed) payments to staff. We do not recommend this an option given this.
Q: How do we report the support we provide to families of students?
A: Financial support to families, students, and staff will very likely be reported on the school’s 990 as a use of funds outside of the organization’s exempt purpose. All documentation should be saved so that the school and its auditor can provide appropriate detail to the IRS. This recordkeeping includes documentation of the type of assistance, criteria for disbursements, date and place of disbursements, number of victims assisted, charitable purpose, and cost of aid.
Additionally, financial support to families, students, or staff in excess of $5,000 must be reported on the school’s 990 and include the recipient’s name and the amount received.
Q: Can we set up a scholarship for our students?
A: Yes. Most schools’ exempt purpose allows for the creation of scholarships. Schools should make sure that they follow the general guidance for awarding scholarships:
All scholarships should be awarded on an objective and nondiscriminatory basis.
No member of your selection committee can benefit in any way from choosing the scholarship recipients (e.g., committee members can not have relatives in the applicant pool) applicants.
You must ensure that any non-U.S. citizen who receives a scholarship is not on a published “Specifically Designated Nationals” terrorism watch list.
Scholarship recipients must:
be a degree candidate at an eligible educational institution
use funds for qualified expenses (includes tuition and fees, books, and course- or degree-related costs, but does not include room & board) or pay income taxes on the unused scholarship
Q: Can we qualify for federal assistance in the form of business loans?
The Coronavirus Aid, Relief, and Economic Security (CARES) Act allocated $350 billion to help small businesses keep workers employed amid the pandemic and economic downturn. Included with the in CARES Act is the Paycheck Protection Program (PPP), the initiative provides 100% federally guaranteed loans to small businesses (i.e., those with fewer than 500 employees) and includes non-profits.* Loans must be used to pay payroll costs (except for employees making $100K+), costs related to group health care benefits (i.e., insurance premiums), interest on mortgage obligations, rent, including rent under a lease, utilities or interest on other debt.
*There have been questions regarding the Paycheck Protection Program and organizations that receive Medicaid. An earlier version of the CARES Act excluded nonprofits that receive Medicaid reimbursements from eligibility however the final version does NOT exclude nonprofits that receive Medicaid reimbursements.
These loans can be up to 2.5x the borrower’s average monthly payroll cost and may be forgiven if borrowers maintain their payrolls during the crisis or restore their payrolls afterward. To get the full benefit of loan forgiveness, businesses must keep their employees and pay them at least 75% percent of their prior-year compensation during the eight-week period from the receipt of a PPP loan.
The Small Business Administration will administer the program. The SBA will ask for a good faith certification that:
The uncertainty of current economic conditions makes the loan request necessary to support ongoing operations**
The borrower will use the loan proceeds to retain workers and maintain payroll or make mortgage, lease, and utility payments
To apply for forgiveness, businesses must submit documentation regarding the eligible uses of loan funds (payroll costs, mortgage interest, utilities, etc.), a certification that such documents are true and correct, as well the amount to be forgiven, and any other documentation the SBA Administrator deems necessary. The SBA is required to issue regulations within 15 days after the enactment of the CARES Act (enacted March 27, 2020). We will provide further updates once the application becomes available.
The PPP appears to be the better program to target over the Economic Injury Disaster Loans (EIDL) due to the PPP’s higher initial allocation and its potential loan forgiveness.
**On May 13th, the Small Business Administration published guidance that “[a]ny borrower that, together with its affiliates,20 received PPP loans with an original principal amount of less than $2 million will be deemed to have made the required certification concerning the necessity of the loan request in good faith.”
Q: What will happen to insurance premiums?
A: While it’s still too early to quantify the full impact of COVID-19 on health insurance costs, some preliminary speculation/projections have begun to come out. A recent NYT article quotes an analysis that insurance premiums could rise by as much as 40 percent; however, this increase is unlikely to impact most FY21 budgets assuming that your renewal period is in the July to September time period.
Insurers typically use historical data and case projections to forecast hospital inpatient stays and utilization. With unexpected, high cost hospital stays to treat severe COVID-19 positive patients, the pandemic will continue to stress the healthcare delivery system in ways that have never before been tested. We will provide more updates as we see them; however, the immediate takeaway is that a level of conservatism should be applied in FY21 budgeting around health insurance expenses.
Q: What are key education provisions in the CARES Act?
A: Among a number of other things, the CARES Act provides supplemental appropriations to various agencies, including the U.S. Department of Education (USED). The Act also provides increased authority for federal agencies to waive select statutory and regulatory requirements. The specifics around implementation will mostly be left up to the discretion of the states; however, the broad strokes of what was included in the Act are below.
Governor’s Emergency Education Relief Fund: Emergency support grants to states to support LEAs that the state determines have been most significantly impacted by COVID-19 and for supporting activities deemed essential for carrying out emergency educational services to students.
Elementary and Secondary School Emergency Relief Fund: $13.5 billion will be made available to states to help schools respond to COVID-19 and related school closures. The use of these funds will be pretty broad with a long list of allowable activities (to be refined by the states). The rough estimate of how much individual LEAs will receive is 80% of current Title I allocation as additional funding next year. The next step is for states to submit applications to USED within 30 days, and then USED will approve or deny the application within 30 days of receipt.
We will provide more updates on the above as additional information is released, particularly from the state agencies.
Human Resources
Q: What are our compliance requirements as a result of the Families First Coronavirus Response Act (FFCRA)?
A: The FFCRA requires that employers with fewer than 500 employees (and all public sector employers) provide paid sick leave of 2 weeks for full-time employees that are
in an isolation or under quarantine order or advisory
experiencing symptoms
caring for a family member or for a child whose school or care provider is closed due to public emergency
Part-time employees are eligible for leave for the number of hours that the employee is normally scheduled to work over that period.
Additionally, employers are required to provide up to 12 weeks of job-protected leave to employees to care for a child whose school or care provider is closed. Employers are required to pay two-thirds of the wages of these employees, not to exceed $200 per day and $10,000 in aggregate.
Wages paid due to the leave requirement will not be subject to the employer portion of the payroll tax. Employers may also claim a 100% refundable payroll tax credit on wages associated with paid sick and medical leave as required in the bill, as well as expenditures associated with additional health benefit contributions; however, this is not applicable to non-profits.
The above provisions will apply from April 1, 2020 through December 31, 2020.
In the immediate, you must distribute this poster (Spanish version) to all staff by April 1, 2020. Given current situations, email is the recommended (and allowable) method of complying.
Additional resources: https://www.dol.gov/agencies/whd/pandemic
Q: What federal benefits will be available to our families and staff?
A: Direct Payments
The CARES Act authorizes direct payments of $1,200 to most adults (although some will get less depending on their individual income). For every child age 16 or under, the payment will include an additional $500. Veterans, the unemployed, and those receiving Social Security or disability payments are eligible as well. The relief amount depends on each person’s income.
Single adults with Social Security numbers who are United States residents and have an adjusted gross income of $75,000 or less will get the full amount.
Married couples with no children earning $150,000 or less will receive a total of $2,400.
Head of household will get the full payment if they earn $112,500 or less.
You can find your adjusted gross income on line 8b of the 2019 1040 federal tax return. If you haven’t prepared a tax return yet, you can use your 2018 return. If you haven’t filed either 2018 or 2019, the IRS suggests filing 2018 tax returns immediately to reduce the likelihood of delays.
You do not need to apply to receive a payment. If the Internal Revenue Service already has your bank account information, it will transfer the money to you via direct deposit within three weeks [around April 17]. The IRS has not yet determined how and when payments will be processed for taxpayers whose bank information is not on file.
Unemployment Benefits
Eligible workers (including part-times workers) will get an extra $600 per week on top of their state benefit. This includes self-employed people (e.g., gig workers, freelancers and independent contractors). Federal unemployment compensation is available to legal permanent residents, refugees, asylees, and other qualified groups, as well as U.S. citizens.
If you rely on a school, day care or another facility to care for a child, elderly parent or another household member so that you can work — and that facility has been shut down because of coronavirus and thus you can’t work — you will be eligible.
If you are unemployed, partially unemployed or unable to work because your employer closed down, you will be covered under the bill.
The extra $600 payment will last for up to four months, covering weeks of unemployment ending July 31. Click here to connect with the D.C. Department of Employment Services (DOES) and apply for unemployment insurance.
Student Loans
Until September 30, there will be automatic payment suspensions for any student loan held by the federal government (a “direct loan”). This does not include F.F.E.L., Perkins loans, loans from state agencies, or loans from private lenders like Sallie Mae or Wells Fargo. The holders of all those kinds of loans may be offering their own assistance programs.
Student Data
Q: What are our compliance requirements as a result of the Families First Coronavirus Response Act (FFCRA)?
A: The FFCRA requires that employers with fewer than 500 employees (and all public sector employers) provide paid sick leave of 2 weeks for full-time employees that are
in an isolation or under quarantine order or advisory
experiencing symptoms
caring for a family member or for a child whose school or care provider is closed due to public emergency
Part-time employees are eligible for leave for the number of hours that the employee is normally scheduled to work over that period.
Additionally, employers are required to provide up to 12 weeks of job-protected leave to employees to care for a child whose school or care provider is closed. Employers are required to pay two-thirds of the wages of these employees, not to exceed $200 per day and $10,000 in aggregate.
Wages paid due to the leave requirement will not be subject to the employer portion of the payroll tax. Employers may also claim a 100% refundable payroll tax credit on wages associated with paid sick and medical leave as required in the bill, as well as expenditures associated with additional health benefit contributions; however, this is not applicable to non-profits.
The above provisions will apply from April 1, 2020 through December 31, 2020.
In the immediate, you must distribute this poster (Spanish version) to all staff by April 1, 2020. Given current situations, email is the recommended (and allowable) method of complying.
Additional resources: https://www.dol.gov/agencies/whd/pandemic
Q: What federal benefits will be available to our families and staff?
A: Direct Payments
The CARES Act authorizes direct payments of $1,200 to most adults (although some will get less depending on their individual income). For every child age 16 or under, the payment will include an additional $500. Veterans, the unemployed, and those receiving Social Security or disability payments are eligible as well. The relief amount depends on each person’s income.
Single adults with Social Security numbers who are United States residents and have an adjusted gross income of $75,000 or less will get the full amount.
Married couples with no children earning $150,000 or less will receive a total of $2,400.
Head of household will get the full payment if they earn $112,500 or less.
You can find your adjusted gross income on line 8b of the 2019 1040 federal tax return. If you haven’t prepared a tax return yet, you can use your 2018 return. If you haven’t filed either 2018 or 2019, the IRS suggests filing 2018 tax returns immediately to reduce the likelihood of delays.
You do not need to apply to receive a payment. If the Internal Revenue Service already has your bank account information, it will transfer the money to you via direct deposit within three weeks [around April 17]. The IRS has not yet determined how and when payments will be processed for taxpayers whose bank information is not on file.
Unemployment Benefits
Eligible workers (including part-times workers) will get an extra $600 per week on top of their state benefit. This includes self-employed people (e.g., gig workers, freelancers and independent contractors). Federal unemployment compensation is available to legal permanent residents, refugees, asylees, and other qualified groups, as well as U.S. citizens.
If you rely on a school, day care or another facility to care for a child, elderly parent or another household member so that you can work — and that facility has been shut down because of coronavirus and thus you can’t work — you will be eligible.
If you are unemployed, partially unemployed or unable to work because your employer closed down, you will be covered under the bill.
The extra $600 payment will last for up to four months, covering weeks of unemployment ending July 31. Click here to connect with the D.C. Department of Employment Services (DOES) and apply for unemployment insurance.
Student Loans
Until September 30, there will be automatic payment suspensions for any student loan held by the federal government (a “direct loan”). This does not include F.F.E.L., Perkins loans, loans from state agencies, or loans from private lenders like Sallie Mae or Wells Fargo. The holders of all those kinds of loans may be offering their own assistance programs.
Student Meals
The below summary references DC agencies and procedures; however, the concepts should be generally transferrable. The below information is consolidated from more extensive guidance published by OSSE (linked below).
Overview
In the event of temporary or prolonged school closures, the USDA provides LEAs with options for providing meals to children. While LEAs are not required to feed children during closures caused by pandemics, building repairs, or natural disasters, OSSE strongly encourages LEAs to do so following USDA’s guidance and with the approval of OSSE and in coordination with public health authorities.
USDA provides two options, the Seamless Summer Option (SSO) and the Summer Food Service Program (SFSP), to provide meals at school settings and in a non-congregate format during unanticipated school closures.
Both the SSO and the SFSP:
require OSSE approval
can be reimbursed for up to two meals each day
can provide up to seven days’ worth of meals at one time (14 meals)
provide meals to children 18 and younger
provide meals free of cost to children
OSSE recommends SSO for those LEAs that are not currently approved sponsors of the SFSP because the approval process is less time-consuming.
Q: What do we have to do to be authorized to serve meals when schools are closed?
A: Two USDA-approved programs can be used to serve meals during unanticipated school closures: the SFSP and the SSO. SFAs (i.e., LEAs) must obtain OSSE approval to use either of these programs to serve meals if schools are closed. SFAs can check with their OSSE nutrition program specialist to determine the best course of action.
SFAs can apply for the SSO in their NSLP application through Orchard. New SFSP sponsors may complete a 2020 SFSP application in Orchard.
Q: Can we offer meals under the standard National School Lunch Program (NSLP) during periods of school closure?
A: No. Meals cannot be served under the standard NSLP during periods of school closure.
Q: Can SFAs and sponsors operate SFSP or SSO programs if the school facilities are closed but remote instruction is provided?
A: Yes. If the building is closed and students cannot attend their physical school location for classes, SFAs and sponsors may operate SFSP or SSO programs as permitted under program requirements even when remote instruction is provided.
Q: Are meals served through SFSP and SSO required to follow the NSLP meal pattern?
A: OSSE strongly encourages SFAs and sponsors to maintain and meet the nutrition standards for each program to the greatest extent possible. If there are specific and justified reasons the meal pattern cannot be met based on disruptions to the availability of food products resulting from unprecedented impacts of COVID-19, OSSE may waive the requirement that meals meet meal pattern requirements.
In order for OSSE to waive meal pattern requirements, SFAs and sponsors must amend and resubmit their SFSP or SSO applications. Amended applications must include the specific food component that cannot be met, including justification. OSSE may approve requests on a case by case basis. Approvals to waive meal pattern requirements remain in effect until April 30, 2020 or the expiration of the federally declared public health emergency, whichever is earlier.
Q: Can SFAs and sponsors serve more than one meal type and/or more than a day’s worth of meals at a time?
A: SFAs and sponsors can serve and be reimbursed for serving up to two meals each day. Meals can be any combination of breakfast, lunch, AM or PM snack, or supper, EXCEPT for lunch and supper. Additionally, SFAs and sponsors may provide up to seven days’ worth of meals at one time. For example, if a site is serving breakfast and lunch, a student may pick up seven days’ worth of breakfasts and seven days’ worth of lunches, totaling 14 meals, at one time. SFAs and sponsors wishing to revise their distribution method must update their SFSP or SSO application to reflect their new distribution. Food safety is of utmost importance, specifically if multiple days’ worth of meals are provided. Please reference the food safety section below.
Q: Will meals served under SFSP and SSO during unanticipated closures related to coronavirus (COVID-19) be eligible for HSA reimbursement?
A: Yes. Breakfast and lunch meals served under SFSP and SSO are eligible for HSA reimbursement. The HSA reimbursement rate is $0.20 for each breakfast served and $0.10 for each lunch served. Due to the unique challenges and administrative burden posed, the $0.05 reimbursement for locally grown and unprocessed foods will not be available during the unanticipated closures related to the coronavirus (COVID-19) response.
Q: How should SFAs and sponsors track meals served to students under the SSO or SFSP? What are the reporting requirements?
A: SFAs and sponsors must track meals on a daily basis either manually or via an electronic point of service (POS) system. These meals must be identified as being served during an unanticipated school closure under each program. Meal tracking must be inclusive of the site name, date of service, meal type(s), and number of meals served. Meal types should be tracked separately.
Q: Will SFAs have to submit a separate claim for SSO?
A: Yes. An SSO claim will need to be submitted separately from the NSLP claim. Additional guidance will be provided specific to SSO claims for reimbursement. Standard 2020 SFSP applications should be submitted. These claim forms will be emailed by OSSE around the 10th of April. The SSO Reimbursement Rates are the same as the Free rate on the NSLP claim.
Q: How do I determine which rate to claim meals under when using SSO?
A: All students may be claimed as “free” under SSO.
Q: How do I complete edit checks within the claim?
A: Edit checks are NOT a required component of the SSO or SFSP claim for reimbursement. SFAs and sponsors must ensure that meals claimed for reimbursement reflect the number of meals served. Daily point of service documents must support the claim for reimbursement.
Additional information: OSSE LEA Meal Provision Guidance Memo and OSSE Q&A
Technology
While e-rate does not support students or families at home, there are some resources that can help. EdOps does not endorse any of these products below. We are providing them for informational purposes only.
Home Internet
Xfinity WiFi
For a limited time, Xfinity WiFi hotspots across the country are free for everyone, including non-Xfinity Internet subscribers. At a hotspot, select the “xfinitywifi” network name in the , then launch a browser. For a map of Xfinity WiFi hotspots, visit www.xfinity.com/wifi
Comcast Internet Essentials
$9.95/month for basic internet (25 Mbps)
nationwide program
first two months free if started by 3/30/20 (see also: Connect.DC below)
to qualify, a household must:
participate in a federal low-income assistance program (SSI, HUD, TANF, etc.)
live at a (pre-wired) Comcast-serviceable address (~60-70% of D.C., as an example)
not have current or recent Comcast internet service (Xfinity)
to apply:
online (recommended): https://www.internetessentials.com/apply
by phone – English: 1-855-846-8376 or Spanish: 1-855-765-6995
Connect.DC (D.C. only)
Offers a $30 credit toward Internet Essentials (above), covering three months of service. After you have been approved and received your first bill, call: (202) 266-6328 / (202-CONNECT). https://connect.dc.gov/affordable-internet
Lifeline
Lifeline is a federal (FCC) program that gives eligible customers up to $9.25 toward their phone or internet (but not both). In all but three states (CA, TX, & OR) support is only available through approved companies and the list is typically very short. https://www.lifelinesupport.org/
Laptops
Comcast Internet Essentials
Customers of the Internet Essentials program above can purchase a discounted computer, new for $150. https://www.internetessentials.com/low-cost-computer
TechSoup
Refurbished IT hardware and software for nonprofits. https://www.techsoup.org/computers-and-electronics
Wilderness Technology Alliance
Free and low-cost laptop computer distributions to students who do not have a computer at home. Minimum order is ten laptops. http://www.wildtech.org/