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Title 20, EducationRelease 119-73not60

§1087–55 Flexible Use of Funds

Title 20 › Chapter 28— HIGHER EDUCATION RESOURCES AND STUDENT ASSISTANCE › Subchapter IV— STUDENT ASSISTANCE › Part C— Federal Work-Study Programs › § 1087–55

Last updated Apr 5, 2026|Official source

Summary

An eligible institution may keep up to 10 percent of its federal work‑study grant to spend in the next fiscal year. If the school does not need those funds and won’t use them the next year, the Department of Education can give them to other schools in the same State until the end of the second fiscal year after the money was approved. The Secretary may also allow up to 10 percent of a school’s yearly grant to be used one year early. A school can pay students for wages earned after the academic year ends but before the next fiscal year starts using the next year’s funds. Students may be paid by direct deposit or by crediting their school account. Account credits can only cover tuition and fees, institution-owned room and board, and other campus goods or services. If a major disaster affects a school’s area, the school may pay affected students for up to one academic year for work they missed, up to the wages they would have earned. Payments go only to students who had work‑study awards and were working before the disaster, and they must meet the usual matching rules unless the Secretary waives them. Definitions: disaster-affected student — a student who had a work‑study award, earned work‑study wages, was kept from working by the disaster, and could not be reassigned. major disaster — as defined in 42 U.S.C. 5122(2).

Full Legal Text

Title 20, §1087–55

Education, Source: USLM XML via OLRC

(a)(1)Of the sums granted to an eligible institution under this part for any fiscal year, 10 percent may, at the discretion of the institution, remain available for expenditure during the succeeding fiscal year to carry out programs under this part.
(2)Any of the sums so granted to an institution for a fiscal year which are not needed by that institution to operate work-study programs during that fiscal year, and which it does not wish to use during the next fiscal year as authorized in the preceding sentence, shall remain available to the Secretary for making grants under section 1087–53 of this title to other institutions in the same State until the close of the second fiscal year next succeeding the fiscal year for which such funds were appropriated.
(b)(1)Up to 10 percent of the sums the Secretary determines an eligible institution may receive from funds which have been appropriated for a fiscal year may be used by the Secretary to make grants under this part to such institution for expenditure during the fiscal year preceding the fiscal year for which the sums were appropriated.
(2)An eligible institution may make payments to students of wages earned after the end of the academic year, but prior to the beginning of the succeeding fiscal year, from such succeeding fiscal year’s appropriations.
(c)An eligible institution may, upon the request of a student, make payments to the student under this part by crediting the student’s account at the institution or by making a direct deposit to the student’s account at a depository institution. An eligible institution may only credit the student’s account at the institution for (1) tuition and fees, (2) in the case of institutionally owned housing, room and board, and (3) other institutionally provided goods and services.
(d)(1)In the event of a major disaster, an eligible institution located in any area affected by such major disaster, as determined by the Secretary, may make payments under this part to disaster-affected students, for the period of time (not to exceed one academic year) in which the disaster-affected students were prevented from fulfilling the students’ work-study obligations as described in paragraph (2)(A)(iii), as follows:
(A)Payments may be made under this part to disaster-affected students in an amount equal to or less than the amount of wages such students would have been paid under this part had the students been able to complete the work obligation necessary to receive work study funds.
(B)Payments shall not be made to any student who was not eligible for work study or was not completing the work obligation necessary to receive work study funds under this part prior to the occurrence of the major disaster.
(C)Any payments made to disaster-affected students under this subsection shall meet the matching requirements of section 1087–53 of this title, unless such matching requirements are waived by the Secretary.
(2)In this subsection:
(A)The term “disaster-affected student” means a student enrolled at an eligible institution who—
(i)received a work-study award under this section for the academic year during which a major disaster occurred;
(ii)earned Federal work-study wages from such eligible institution for such academic year;
(iii)was prevented from fulfilling the student’s work-study obligation for all or part of such academic year due to such major disaster; and
(iv)was unable to be reassigned to another work-study job.
(B)The term “major disaster” has the meaning given such term in section 5122(2) of title 42.

Legislative History

Notes & Related Subsidiaries

Editorial Notes

Codification Section was formerly classified to section 2755 of Title 42, The Public Health and Welfare, prior to transfer to this section. See note below. Section was originally enacted as section 125 (and later renumbered section 145) of the Economic Opportunity Act of 1964, Pub. L. 88–452, at which time it was classified to section 2755 of Title 42, The Public Health and Welfare. It was renumbered as section 445 of title IV of the Higher Education Act of 1965, Pub. L. 89–329, by Pub. L. 90–575, § 131(a), (b)(1), and later editorially transferred to this section to merge with the rest of the Act, which is classified to this chapter. For complete credit information on acts affecting this section prior to Pub. L. 99–498, see

Prior Provisions

note below.

Prior Provisions

A prior section 445 of Pub. L. 89–329, title IV, formerly Pub. L. 88–452, title I, § 145, formerly § 125, Aug. 20, 1964, 78 Stat. 516; Pub. L. 89–329, title IV, § 441(6), Nov. 8, 1965, 79 Stat. 1250; renumbered § 145, Pub. L. 90–222, title I, § 111(a), Dec. 23, 1967, 81 Stat. 726; renumbered Pub. L. 89–329, title IV, § 445, by Pub. L. 90–575, title I, § 131(a), (b)(1), Oct. 16, 1968, 82 Stat. 1028, related to sources of matching funds, prior to the general revision of this part by Pub. L. 99–498. See section 1087–54 of this title.

Amendments

2008—Subsec. (d). Pub. L. 110–315 added subsec. (d). 1998—Subsec. (c). Pub. L. 105–244 added subsec. (c). 1992—Subsec. (b). Pub. L. 102–325 designated existing provisions as par. (1) and added par. (2).

Statutory Notes and Related Subsidiaries

Effective Date

of 1998 AmendmentAmendment by Pub. L. 105–244 effective Oct. 1, 1998, except as otherwise provided in Pub. L. 105–244, see section 3 of Pub. L. 105–244, set out as a note under section 1001 of this title.

Effective Date

of 1992 AmendmentAmendment by Pub. L. 102–325 effective Oct. 1, 1992, see section 2 of Pub. L. 102–325, set out as a note under section 1001 of this title.

Reference

Citations & Metadata

Citation

20 U.S.C. § 1087–55

Title 20, Education

Last Updated

Apr 5, 2026

Release point: 119-73not60