Districts Fret Over July 31 Deadline for Spending U.S. Hurricane Aid

Cash-strapped school districts in areas ravaged by Hurricanes Katrina and Rita are worried they may have to return federal aid meant to cover the cost of educating displaced students because a federal deadline allows them scant time to determine how to use the money.

Districts must decide how they plan to spend that funding, called “impact aid,” by July 31, or give it back to the federal government, said Chad Colby, a spokesman for the U.S. Department of Education.

The Hurricane Education Recovery Act, enacted late last year, provided $645 million to districts across the country that took in students displaced by the hurricanes. Gulf Coast districts that were themselves hit by the storms qualify for the aid if they serve students meeting the federal definition of “displaced,” which is any student enrolled in a school other than the one he or she attended...