North Carolina House Representative Alma Adams has won an important victory for Historically Black Colleges and Universities (HBCUs) by incorporating her bill, the HBCU Capital Finance Debt Relief Act, in the 2021 Omnibus Spending Act which was signed into law on December 27th 2021. Representative Adams chairs the bipartisan Congressional HBCU Caucus, which she co-founded in 2015. Her legislation will discharge $1.34 billion in loans to HBCU’s across the country accrued under the HBCU Capital Loan Financing Program. The relief will be a boon for HBCUs which have historically been underfunded.
To give an idea of how much this bill will help, the total endowments for all of the United States HBCUs is $2.1 billion, by comparison UNC Chapel Hill has the 29th largest endowment for colleges and Universities in the United States of 3.7 billion. The relief represents over half of HBCUs’ total endowments and will help alleviate some of the disparities between HBCUs and comparable Predominantly White Institutions (PWIs). According to a 2018 study by the Government Accountability Office HBCUs have a median endowment of $15,000 per student compared with matched non-HBCU schools that had a median endowment of $410,000 per student.
HBCUs help drive the economic development of the United States. According to a study by UNCF HBCUs generate $14.8 billion in economic impact annually. Investment in HBCUs provides an excellent return on investment in which for each dollar of initial spending generates $1.44 dollars in subsequent spending for the regional economies in which they reside. Since HBCUs are often located in economically struggling regions, the health and wealth these institutions provide are often essential to the economic wellbeing of the locations they reside in. Representative Adam’s bill also expands Pell grant eligibility, which will help all college students but particularly those that attend HBCUs. Over 75% of HBCU undergraduate students rely on Pell grants to pay for college expenses, compared to 39.1 of all US undergraduate students who use Pell grants to fund their education. Representative Adam’s bill expands the number of people eligible to receive aid and increases the maximum grant amount. The bill will help HBCUs and their students to continue to help grow and expand the economies in their surrounding communities.