Department of Education

HISTORICALLY BLACK COLLEGE AND UNIVERSITY

CAPITAL FINANCING PROGRAM ACCOUNT

Fiscal Year 2024 Budget Request

CONTENTS

Page

Appropriations Language.............................................................................................................. 1

Analysis of Language Provisions and Changes............................................................................ 2

Appropriation, Adjustments, and Transfers................................................................................... 3

Obligations by Object Classification.............................................................................................. 4

Authorizing Legislation.................................................................................................................. 5

Appropriations History................................................................................................................... 6

Federal Administration.............................................................................................................. 7
HISTORICALLY BLACK COLLEGE AND UNIVERSITY

CAPITAL FINANCING PROGRAM ACCOUNT

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Appropriations Language

For the cost of guaranteed loans, $20,150,000, as authorized pursuant to part D of title III of 

the HEA, which shall remain available through September 30, 2025:1 Provided, That such costs, 

including the cost of modifying such loans, shall be as defined in section 502 of the 

Congressional Budget Act of 1974:2 Provided further, That these funds are available to 

subsidize total loan principal, any part of which is to be guaranteed, not to exceed 

$377,340,824: 3 Provided further, That these funds may be used to support loans to public and 

private Historically Black Colleges and Universities without regard to the limitations within 

section 344(a) of the HEA.4

In addition, for administrative expenses to carry out the Historically Black College and 

University Capital Financing Program entered into pursuant to part D of title III of the HEA, 

$600,000.5

NOTE

Each language provision that is followed by a footnote reference is explained in the Analysis of Language 

Provisions and Changes document which follows the appropriations language.
HISTORICALLY BLACK COLLEGE AND UNIVERSITY

CAPITAL FINANCING PROGRAM ACCOUNT

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Analysis of Language Provisions and Changes

Language Provision Explanation

1 For the cost of guaranteed loans, 

$20,150,000, as authorized pursuant to part D 

of title III of the Higher Education Act of 1965 

(HEA), which shall remain available through 

September 30, 2025: 

In accordance with the Federal Credit Reform 

Act of 1990, the requested language 

appropriates $20.150 million in subsidy for 

new loans to be made under the HBCU 

Capital Financing program. This amount will 

be available for obligation for 2 fiscal years. 

No loans may be insured under the program 

that would require subsidy above this amount.

2 Provided, That such costs, including the cost 

of modifying such loans, shall be as defined in 

section 502 of the Congressional Budget Act of 

1974:

This requested language specifies that any 

program costs or cost modifications shall 

comply with the definitions that are provided in 

Section 502 of the stated Act.

3 Provided further, That these funds are 

available to subsidize total loan principal, any 

part of which is to be guaranteed, not to exceed 

$377,340,824:

3

The requested language limits the amount of 

bonds that may be insured under the HBCU 

Capital Financing program to $377 million in 

fiscal year 2024. This is a decrease of $375

million over 2023. 

4Provided further, That these funds may be 

used to support loans to public and private 

historically Black colleges and universities 

without regard to the limitations within section 

344(a) of the HEA.

The requested language allows the program to 

make loans in fiscal year 2021 without regard 

to the language in HEA section 344(a) that 

sets limits on the amount of the program’s 

loan authority that can be devoted to private 

versus public HBCUs.

5 In addition, for administrative expenses to 

carry out the Historically Black College and 

University Capital Financing Program entered 

into pursuant to part D of title III of the HEA, 

$600,000.

In accordance with the Federal Credit Reform 

Act of 1990, this language appropriates funds 

to administer new loans, service existing loan 

obligations, and provide technical assistance 

to prospective and existing program 

participants.
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Appropriation, Adjustments, and Transfers

(dollars in thousands)

Appropriation/Adjustments/Transfers 2022 2023 2024

Discretionary: 

Appropriation $20,150 $20,150 $20,150

Mandatory: 

 

 Modification of existing loan subsidies 0 0 0

 Reestimate of existing loan subsidies 38,410 22,990 0

Total, discretionary and mandatory appropriation 40,420 43,140 20,150
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CAPITAL FINANCING PROGRAM ACCOUNT

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Obligations by Object Classification

(dollars in thousands)

Object Class Code Object Class

2022

Actual

2023 

Base

2024 

Request

Change 

from 2023 to 

2024

11.10 Full-time permanent $184 $314 $361 -$47

11.31 Full-time temporary 0 0 0 0

11.52 Awards 3 3 4 -1

Compensation subtotal 187 317 365 -48

12.00 Benefits 70 119 129 -10

Comp/benefits subtotal 257 436 494 -58

21.00 Travel 15 36 40 -4

23.10 Rental payments to GSA 8 9 8 1

Subtotal Travel/Rent 23 45 48 -3

25.21 Other services 13 5 6 -1

25.22 Training/tuition contracts 4 0 0 0

25.30 Goods/services from 

Federal sources 2 3 4 -1

25.72 IT services/contracts 35 39 48 -9

Subtotal 25 54 47 58 -11

26.00 Supplies 0 0 0 0

Total, Budget Authority 334 528 600 -72
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Authorizing Legislation

(dollars in thousands)

Activity

2023 

Authorized

2023

Appropriation

2024

Authorized

2024

Request

Federal administration (Federal Credit 

Reform Act of 1990, Section 505(e) 

and HEA Title III, Part D) Indefinite $528

To be 

determined $600

Loan subsidy (Federal Credit Reform 

Act of 1990, Section 505(e), and 

HEA Title III, Part D) Indefinite 20,150

To be 

determined 20,150

Loan modification (Federal Credit 

Reform Act of 1990, Section 

505(e), and HEA Title III, Part D) Indefinite 0

 To be 

determined 0

Reestimate of existing loan subsidies 

(Federal Credit Reform Act of 

1990, Section 504(f)) Indefinite 22,990 

To be 

determined 0

Total discretionary appropriation 20,678 20,750

Total mandatory appropriation 22,990 0
HISTORICALLY BLACK COLLEGE AND UNIVERSITY 

CAPITAL FINANCING PROGRAM ACCOUNT

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Appropriations History

Year

Budget 

Estimate 

to Congress

House 

Allowance

Senate 

AllowanceFootnote AppropriationFootnote

2015 $19,430 N/A1 $20,444 $19,430

2016 19,436 $19,0962 19,0962 20,150

2017 20,112 20,1123 20,1123 20,112

2018 20,150 30,1504 30,1504 30,1504

2019 40,150 40,1505 40,1505 40,1505

2020 40,150 50,484 40,1506 46,1506

2021 40,150 48,150 48,1507 48,1507

2022 20,150 48,1508 20,1508 22,1508

2023 20,150 20,1509 20,1509 20,1509

2024

1 The House allowance is shown as N/A because there was no Subcommittee action.

2 The levels for House and Senate allowances reflect action on the regular annual 2016 appropriations. 3 The levels for House and Senate allowances reflect action on the regular annual 2017 appropriations; 

the Appropriation reflects the Consolidated Appropriations Act, 2017.

4 The 2018 amount reflects an additional $10 million for outstanding loan deferments that is expected to 

be appropriated for at least three fiscal years.

5 The levels for the House and Senate Allowance reflects Committee action on the regular annual 2019 

appropriations bill; the Appropriation reflects enactment of the Department of Defense and Labor, Health 

and Human Services, and Education Appropriations Act, 2019 (P.L. 115-245). 6 The Senate allowance reflects the Chairman’s mark; the Appropriation reflects the Further Consolidated 

Appropriation Act, 2020 (P.L. 116-94). 7 The Senate allowance reflects the Chairman’s mark; the Appropriation reflects Division H of the

Consolidated Appropriations Act, 2021 (P.L. 116-260). 8 The House allowance reflects floor action on the FY 2022 Consolidated Appropriations Act; the Senate 

allowance reflects the Chairman’s mark; and the Appropriation reflects the Consolidated Appropriations 

Act, 2022 (P.L. 117-103). 9 The House allowance reflects the regular annual FY 2023 appropriation, which was introduced on the 

floor; the Senate allowance reflects the Chairman’s mark; and the Appropriation reflects the Consolidated 

Appropriations Act, 2023 (P.L. 117-328)
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Federal Administration

(Federal Credit Reform Act of 1990, Section 505(e) and the Higher Education Act of 1965, 

Title III, Part D)

(dollars in thousands)

FY 2024 Authorization: To be determined1

Budget Authority:

2023 Appropriation 2024 Request Change 

Federal Administration $528 $600 +$72

Loan subsidy costs 20,150 20,150 0

Total 20,678 20,750 +72

Full-time equivalent employee 2 2 0

PROGRAM DESCRIPTION

Since fiscal year 1996, the Historically Black Colleges and Universities Capital Financing 

Program has provided Historically Black Colleges and Universities (HBCUs) with access to 

capital financing for the repair, renovation, and, in exceptional circumstances, construction or 

acquisition of educational facilities, instructional equipment, research instrumentation, and 

physical infrastructure. HBCUs, which have played a prominent role in our Nation’s history, have 

significant needs for capital improvements. However, in most cases these institutions cannot 

access traditional funding sources at reasonable interest rates. The HBCU Capital Financing 

Program provides HBCUs with access to low-cost financing to fund infrastructure 

improvements. This program has made low-interest loans available for capital improvements to 

some of the Nation’s most vulnerable institutions of higher education. These loans have allowed 

these institutions to make improvements to their capital stock, especially academic facilities and 

student living quarters. In order to limit the Federal Government’s exposure to incurring losses 

due to defaults and delinquencies, 5 percent of all loans are deposited in a pooled escrow 

account from which loan payments can be made in the event of defaults or delinquencies.

The HBCU Capital Financing Advisory Board, appointed by the Secretary, advises the 

Secretary and the Designated Bonding Authority (DBA) as to the most effective and efficient 

means of implementing the program. The DBA, also selected by the Secretary, assists with the 

operation of the HBCU Capital Financing Program, which includes raising bond capital, making 

loans to eligible institutions, charging interest, and providing for a schedule of repayments. 

Direct loans are financed through the Federal Financing Bank, and guaranteed loans are 

1 The GEPA extension expired September 30, 2015. Reauthorization for FY 2024 is expected through 

appropriations action.
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financed through the private market, with all loan payments fully insured by the Federal 

Government.

Debt Discharges

The FAFSA Simplification Act, which was included in the Consolidated Appropriations Act, 

2021, signed into law in December 2020, provided authority and funding to discharge debts 

under the HBCU Capital Financing Program. The Department discharged approximately $1.6 

billion of debt provided to participating institutions. This action provided debt relief to 45 HBCUs 

– 13 public institutions and 32 private institutions. Discharging these debts helped enable 

recipient institutions to focus their resources on supporting students, faculty, and staff for the 

duration of the COVID-19 national emergency. 

Federal Administration

Funds for this activity pay the Federal costs for administering the HBCU Capital Financing 

Program. The administrative costs for this program include the personnel compensation and 

benefits for 2 full-time equivalent (FTE) employees, overhead, and other administrative services. 

The FTE reported in this account reflects the Department's estimate of the staff time devoted to 

administering the program. This estimate does not include FTEs associated with the 

Department's centralized services, which are reflected in the Program Administration account. 

The major non-personnel costs include support for the HBCU Capital Financing Advisory Board 

and a contract with the DBA to provide technical assistance workshops.

Loan Subsidy Costs

In the first 10 years that the HBCU Capital Financing Program operated, there were no 

delinquencies or defaults. The rigorous application and credit review process imposed by the 

Department and DBA was credited with ensuring that recipient institutions receiving loans would 

be able to comply with the terms of their loans. However, increases in financial instability at 

certain HBCUs have affected Federal liability in the program, which are reflected in delinquency 

rate fluctuations and Department estimates. 

Discretionary funding levels for the past 5 fiscal years were:

Fiscal Year (dollars in thousands) 

2019 $40,150

2020 46,150

2021 48,150

2022 20,484

2023 20,678
HISTORICALLY BLACK COLLEGE AND UNIVERSITY

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FY 2024 BUDGET REQUEST

For fiscal year 2024, the Administration requests $20.8 million for the Historically Black College 

and University (HBCU) Capital Financing Program account, $72 million higher than the fiscal 

year 2023 appropriation. The request includes $600,000 for administrative expenses and $20.2 

million for new loan subsidy costs.

The fiscal year 2024 request continues to lift the restrictions in 20 U.S.C. 1066c(a) which 

currently prevent Howard University from accessing the HBCU Capital Financing Program. 

Howard University, similar to all other HBCUs, should have access to low-interest capital 

financing to address its capital needs. 

The $600,000 requested for administration will also be used to maintain technical assistance 

services. It is estimated that the requested subsidy amount will be sufficient to guarantee over 

$377 million in new loans.

PROGRAM OUTPUT MEASURES

(dollars in thousands)

Output Measures 2022 2023 2024

Number of new loans:

New loans to Private HBCUs 3 7 4

New loans to Public HBCUs 1 1 1

Total new loans 4 8 5

New loan volume:

New loans to Private HBCUs $50,254 $281,497 $230,375

New loans to Public HBCUs 64,831 34,795 86,080

Total new loan volume 115,085 316,292 316,455

Total number of loans:

Total loans to Private HBCUs 11 18 22

Total loans to Public HBCUs 7 8 9

Total number of loans 18 26 31

Total loan awards:

Total loans to Private HBCUs $89,000 $445,500 $219,500

Total loans to Public HBCUs 96,000 50,000 50,000

Total outstanding awards 185,000 495,500 270,000

Total outstanding loan awards:

Total loans to Private HBCUs $153,983 $389,774 $580,288

Total loans to Public HBCUs 116,495 145,640 216,827

Total outstanding awards 270,478 535,414 797,115
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PROGRAM PERFORMANCE INFORMATION

Performance measures

This section presents selected program performance information, including, for example, GPRA 

goals, objectives, measures, and performance targets and data. Achievement of program 

results is based on the cumulative effect of the resources provided in previous years, and those 

requested in fiscal year 2024 and future years, as well as the resources and efforts invested by 

those served by this program. The Department will be reviewing GPRA program performance 

goals, objectives, and measures for the HBCU Capital Financing Program for possible revision 

in future years to ensure alignment with Administration policy.

Goal: To improve loan recipients’ overall financial stability and enhance their ability to 

attract, retain and educate students.

Objective: Total revenues and investment return will increase for loan recipients.

Measure: The percentage of borrowers who increase revenues and investment return annually.

Year Target Actual

2019 70% 47%

2020 70 67

2021 70 93

2022 70

2023 70

Additional information: This performance measure is the percentage of HBCUs that 

experienced an increase in revenue over the prior year. This measure is one gauge of improved 

institutional financial stability and capability to fulfill their educational mission. Loans that fund 

capital and infrastructure improvements are key assets for providing quality postsecondary 

education. Some HBCUs have significant cash flow problems, which capital improvements from 

this program are expected to help ameliorate. Revenue is a strong indicator of an institution’s 

success at maintaining or increasing enrollment, expanding fundraising activities, and, 

ultimately, the institution’s financial stability. The ability to maintain or increase revenue 

suggests that an institution will be able to service its debts and maintain its operations. This 

measure helps to assess the financial solvency of borrowers, which is a gauge of default 

potential. This measure is calculated as the number of HBCUs in the program that have 

experienced an increase in revenue over the prior fiscal year, divided by the total number of 

HBCUs in the program, and multiplied by 100. The data source for total revenues is the National 

Center for Educational Statistics' (NCES) Integrated Postsecondary Education Data System. 
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Goal: To improve the capacity of program borrowers to improve student success and 

provide high-quality educational opportunities for their students.

Objective: Maintain or increase the persistence rate of first-year students at borrower 

institutions.

Measure: The full-time retention rate is the percent of the fall full-time cohort from the prior year 

minus exclusions from the fall full-time cohort that re-enrolled at the institution as either full or 

part-time in the current year.

Year Target Actual

2019 71% 61%

2020 71 65

2021 71 72

2022 71

2023 71

Additional information: New and improved physical facilities can help an institution of higher 

education increase student persistence. Many of the loans have provided support for student 

housing and many of the borrowers have explicitly cited the lack of adequate student housing 

and facilities as a reason for high attrition rates on their campuses in their loan applications. 

Historically, the persistence rate at HBCUs receiving loans through the capital finance program 

is about the same as at HBCUs overall. This measure relies on data maintained by NCES.