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Inside HR 5

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WASHINGTON--In its 401-to-1 passage of HR 5 last month, the House demonstrated a remarkable degree of consensus in reauthorizing more than a dozen programs aiding elementary and secondary education, with one notable exception: impact aid.

Several amendments to the $800-million program were proposed, then withdrawn amid confusion, recriminations, and divisions among the school districts that depend on the aid.

And during the debate on the House floor, Representatives William D. Ford, Democrat of Michigan, and William F. Goodling, Republican of Pennsylvania, sharply criticized the National Association of Federally Impacted Schools, which the Congressmen said they were holding responsible for the confusion.

"I have never seen an education lobby that has done such a successful job of creating confusion as this one has,'' Mr. Ford said. "Suddenly, a smooth-running program, that ever since 1951 had never really been seriously challenged on the [House] floor, finds itself with no supporters, except those few members who have been up here offering amendments that are ill-fated because it is too late.''

"I say that, as an association, the wheels have come off the buggy,'' he added. Mr. Goodling admonished the group to "get its act together'' before the Senate takes up the reauthorization of the impact-aid law, which is set to expire on Sept. 30, 1988.

2,661 Districts

Under the program, districts may qualify for compensation where the presence of the federal government--in the form of military installations, Indian reservations, federally owned real estate, or low-income public housing--results in a loss of tax revenue.

This year, 2,661 districts, enrolling a little more than two million children, are receiving the no-strings-attached subsidy.

The two Congressmen, who are senior members of the House Education and Labor Committee, were irate because several Representatives had offered unexpected amendments. In earlier committee deliberations, the impact-aid group had withdrawn its legislative package after the lobby's united front began crumbling.

Moreover, the proposals shattered the fragile impact-aid coalition by taking a piecemeal approach, responding to the needs of some "federally impacted'' districts, but not others.

Seeking to head off a confrontation, Representative Augustus F. Hawkins, the California Democrat who heads the panel, agreed that, if the sponsors would withdraw their amendments, he would consider them during a House-Senate conference committee.

As drafted, HR 5 would extend the program, with only minor changes, through 1993. For next year, it would authorize $759 million, including $24 million for school construction.

Thomas R. Shipley, executive director of the impact-aid association, said the criticisms of Representatives Ford and Goodling were misplaced--the result of "a misunderstanding and a lack of communication.''

Mr. Shipley said his group had been unfairly blamed for the renegade actions of a handful of school districts. "In this very large school of 2,661 children,'' he added metaphorically, "there are four or five who are receiving attention for not behaving by the rules. ... It's a nasty, nasty situation.''

He argued that reforms are needed to correct inequities and to create stability in the current law.

Currently, he said, some districts are receiving as much as $3,000 per child and others as little as $25. And school administrators never know how much they will receive from year to year because impact aid, unlike other federal education programs, is not "forward funded.''

Despite pressure for change, Mr. Shipley explained, the impact-aid coalition has always been an uneasy one, because the law's complexity makes for a diversity of conflicting interests among eligible districts.

Impact aid "A''--the highest priority--compensates districts based on the number of children whose parents both live and work on tax-exempt federal property.

Impact aid "B'' is apportioned on the basis of the number whose parents either live or work there.

Also, there are priorities within each category. "Super A'' districts, for example, where at least 20 percent of children meet the criteria, are heavily dependent on impact aid; they receive the highest priority in the allocation of funds. At the other end of the pecking order are "regular B'' districts, where fewer than 20 percent of children meet the "B'' criteria; they receive a lower allocation per child and are last to receive funding--if it is still available.

Further funding disparities prevail among schools serving Indian students, military dependents, and inner-city youths.

In all, the Education Department has identified 15 categories of children that make districts eligible for impact aid.

The program has been a favorite target of budget-cutters since the Eisenhower Administration, and the decline has been precipitous since 1981, even though the Reagan Administration has failed in its campaign to eliminate "B'' payments. It would cost $1.4 billion to $1.5 billion to finance the program fully under current law--almost twice the current appropriation--Mr. Shipley estimated.

According to the Congressional Research Service, the impact-aid pie has shrunk by 58.6 percent since 1966, after adjusting for inflation. This factor, in particular, has made it difficult for impact-aid districts to work in concert on Capitol Hill, observers say.

Agreement Unravels

Mr. Shipley said his organization, which is supported by about 700 districts, had agreed on a legislative package in early April and lined up a sponsor, Representative Charles A. Hayes, during committee deliberations.

But the agreement unraveled, Mr. Shipley added, when districts receiving impact aid for children from low-income housing sought a better deal from Mr. Hayes, a Democrat who represents the south side of Chicago. Republicans on the Education and Labor Committee objected, and the amendment was withdrawn.

When HR 5 reached the House floor a month later, the association decided not to push its proposal, Mr. Shipley said. To head off a threat to repeal "B'' payments, it agreed not to oppose a simple extension of current law.

But once again, a part of the impact-aid constituency--this time, about 20 "super A'' military districts--sought a special deal for themselves.

At their behest, Representative Hal Daub, Republican of Nebraska, proposed an alternative funding source, allowing districts that received less than their full allocation to receive additional compensation from the Defense Department. The idea was to count on military-base commanders to secure the extra money from the Pentagon, according to one Congressional staff member.

Other districts, however, strongly opposed this maneuver as a threat to the political cohesion of the impact-aid lobby, and Mr. Daub agreed to withdraw the amendment.

Representative Robert W. Davis, Republican of Michigan, offered another amendment that divided the impact-aid lobby by proposing to restrict the ability of states with school-finance-equalization formulas to count impact aid as local revenue.

According to a recent Congressional Research Service study, such laws in Arizona, Kansas, Maine, Michigan, and Wisconsin end up penalizing poor districts--but not affluent ones--that receive impact aid.

The Davis amendment, however, was opposed by Representative Bill Richardson, Democrat of New Mexico, who said his state stood to lose nearly $32 million under the measure. Also, it would have created funding disparities between districts that were eligible for impact aid and those that were not, he said.

Senate Prospects

Mr. Shipley expressed optimism that both the House and the Senate would act favorably on his association's legislative package during the 100th Congress. He declined, however, to discuss legislative strategy or identify potential allies.

Any impact-aid changes as part of HR 5 would require the Senate to approve a proposal that differs from the House-passed version. Otherwise, new amendments would be out of order during conference-committee deliberations.

The group's proposal would authorize more than $2 billion for impact aid, Mr. Shipley added, although there is little likelihood the program would be "fully funded'' in the near future.

Some members of the Congress have advocated entitlement status for impact aid, a change that would make the subsidy a matter of right, while removing the uncertainty about appropriation levels. Such a procedure is only fair, Mr. Shipley said, because the government should pay its own way where its activities have reduced the tax base and swelled the school population.

But the association recognizes that the entitlement idea is not feasible in today's political climate, Mr. Shipley said. He added that a more realistic goal would be a stable funding formula, which would remove the need for appropriations committees to tinker with this complex mechanism each year.

Such a change would be a boon to districts, especially those that depend on impact aid for 50 percent to 90 percent of their budgets, in planning for the next school year.

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