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HBCU Stimulus Funding Has Helpful Yet Limited Impact

Since the $787 billion stimulus package, formally known as the American Reinvestment and Recovery Act (ARRA), was signed into law last year, an estimated $50 billion to $75 billion have gone to higher education institutions through research grants, capital improvement funds and student aid.

A Diverse analysis shows that, in the first year of the program, fiscal year 2009, federal agencies funneled more than $550 million to historically Black colleges and universities. However, the analysis is not definitive due to reporting irregularities. While publicly available data does little to distinguish new monies from yearly grants and appropriations, it appears much of the stimulus money to HBCUs was used to help them hang on rather than thrive with a new investment.

President Barack Obama has pledged to increase federal funding to minority-serving institutions and bring direct investment to these schools to historic levels. During the first year of the ARRA allocations, the nation’s HBCUs experienced some of the worst economic retrenchment, resulting in layoffs, substantial cutbacks, dwindling endowments and donations, and, in some cases, tuition hikes, interviews show.

HBCU boosters hoped the stimulus package would serve as a lifeline and provide a significant new investment in institutions that have been historically underfunded. The package contained money that would make an “incredible difference” to HBCUs, Lezli Baskerville, president of the National Association for Equal Opportunity in Higher Education (NAFEO), told Reuters before Obama signed ARRA in February 2009.

Observers are mute about the impact so far and probably because so little is known about how much money these institutions received. Despite government promises of transparency that resulted in a public database to track spending, located at, determining the HBCU portion of the $787 billion package is a confounding and daunting task.

“We know there was a flow of stimulus funds to higher education, and a number of HBCUs benefited from those funds,” says Dr. John Silvanus Wilson, executive director for the White House Initiative on Historically Black Colleges and Universities, whose office has been trying to make stimulus distinctions. “And as far as we know, the funds were put to good use.”

Using information from federal and state governments, as well as recipient institutions, Diverse collected and analyzed award data for the nation’s private and public HBCUs. However, due to missing data and incongruence in the government’s formatting and categorization, some institutions are left out of this analysis.

Preliminary calculations show that, in 2009 alone, HBCU awards totaled more than $550 million with four institutions receiving more than $20 million for each of their campuses. Using data from 95 private and public HBCUs in the 2009 cycle, Diverse organized awards according to type, amount and awarding agency.

Money entered HBCUs via capital improvement projects, research grants in medicine and science, work-force development and building preservation. But the vast majority of the awards — about half — bolstered Pell Grants, Federal Work Study and other forms of student aid.

This strategy does not differ from how HBCUs are generally funded.

“Between $3.5 (billion) and $4 billion flows from the federal government to HBCUs every year, but it is still less than 3 percent of the money that flows from the federal government to all of American higher education. Most of that money comes in the form of student financial aid,” Wilson says.

Dr. Marybeth Gasman, a University of Pennsylvania professor and higher education historian, says using stimulus money to maintain the status quo is problematic. The bulk of the stimulus funds were awarded or linked to continuing grants from agencies like the National Institutes of Health (NIH), the National Science Foundation (NSF) and the Department of Education. But few of the awards represent additional funds to help struggling HBCUs.

“I think the federal government (and the states for that matter) needs to allocate significantly more money to HBCUs,” Gasman wrote in an e-mail to Diverse. “These institutions have a unique role to play and in order to more fully play that role, they need funding to support their fundraising infrastructure, grant-writing infrastructure and student retention supports.”

Saving Grace

Other preliminary findings indicate that states with the largest number of HBCUs – Alabama, Louisiana, Tennessee, Georgia, North Carolina and Mississippi – account for more than half of all 2009 HBCU awards.

Expectedly, smaller private HBCUs, with the exception of a few, were limited to awards amounting to less than $5 million and in total account for about a third of the HBCU award. Whereas public institutions raked in the cash, most of it was made up of financial aid requests and money to save jobs.

Such is the case with Tennessee State University. According to data, Tennessee State received one of the largest sums of federal money, but most — about $19 million worth — went to plug holes in the disintegrating budget. The institution received State Fiscal Stabilization Funds (SFSF), federal dollars designed to serve as a general fund for state governments struggling to make ends meet in all sectors of its budget.

“We delayed some layoffs, and managers are working at making other cuts,” says Bradley White, assistant vice president for budget and travel. “It may be a temporary fix but we’ve saved some jobs.”

SFSF monies are helping TSU stay afloat until 2012 as federal funds replace state dollars that have dried up. Still not out of the woods, the school had to plug a $14 million budget gap by making cuts across the board. Through voluntary buyouts, reductions in travel, equipment purchases and overall operating expenses, officials estimate they’ve saved enough to fill the cracks. It wasn’t enough to stave off tuition hikes, which increased 5 percent in both 2009 and 2010.

White contends the stimulus saved his institution — temporarily — and that a second stimulus is needed to keep the fragile institution from teetering into a full-scale fiscal crisis.

“I’m not sure what we would have done without the stimulus. It certainly softened the blow,” White says, but “the drastic drop of support will not be good for the future.”

The stimulus also provided TSU with $7.7 million in Pell Grants, which accounted for a quarter of the entire TSU stimulus award. TSU also secured stimulus research funds from the National Science Foundation. This includes $600,000 to upgrade and perfect a telescope for its astronomy program, according to Dr. Maria Thompson, TSU’s vice president for research and sponsored programs.

“TSU was the first university to confirm the existence of planets outside our solar system,” Thompson says, “so this allows us to continue that legacy of being a world leader in astronomy.”

In the Name of Science

TSU’s telescope grant is among various stimulus grants awarded to HBCUs from the National Institutes for Health and the National Science Foundation, which funded research and development in STEM-related job creation, construction and training, according to Diverse’s preliminary analysis.

It’s through grants like these that Wilson would like to see more HBCU participation. 

The substantial increases in student aid through the health care reform act are said to benefit HBCUs that enroll a disproportionate number of low-income students, and MSIs are estimated to see, if approved, a funding increase in 2011 of more than 20 percent, or $120 million, over 2009 levels, according to White House budget requests. But Wilson says he’s dedicated to bringing more research money to HBCUs that historically haven’t be able to compete with larger institutions with dedicated staff and resources for grant writing.

Morehouse College’s School of Medicine was one of the biggest beneficiaries, receiving $39 million in stimulus money for NIH-supported studies, including one to find a cure for cholera — a bacterial infection of the small intestine that is rampant in areas with poor sanitation.

Among other notable grants:

Mississippi is the “most disease-prone state in the nation,” according to a Jackson State University grant proposal. So NIH will help fund a summer research program for young scholars from the local K-12 system to nourish interest in the biomedical sciences.

North Carolina, which is home to 12 two-year and four-year HBCUs, banked approximately $92 million. The largest winner was North Carolina A&T State University, which received more than $22 million in state funds as well as 11 different research grants. NSF is supporting a proposal that will fund NC A&T’s work to convert swine manure into organic asphalt binder for highway and airport pavement. Grant writers said it would limit waste management costs and improve roads.

Central State University in Ohio received one of the larger awards under the Interior Department’s $15 million stimulus program tailored exclusively for HBCU historic building preservation needs. Central State University has received $1.75 million so far to renovate Emery Hall, the former woman’s dormitory considered an architectural wonder when it was completed in 1913 with large donations from industrialist Andrew Carnegie and philanthropist E.J. Emery, who named the building after his mother. It was placed on the National Register of Historic Places in 2005. Since then, the ongoing project has enjoyed substantial federal support matched by contributions from the university. 

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