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Education

K-12 Aid Faces Uncertain Future, Despite ‘Fiscal Cliff’ Deal

By Alyson Klein — January 01, 2013 5 min read

UPDATED

Education programs will be spared the prospect of the largest across-the-board cuts in history, but only temporarily, under a bill to avert much of the so-called “fiscal cliff,” overwhelmingly approved by Congress on Tuesday.

The measure, which passed the U.S. Senate 89-8 early Tuesday morning and the U.S. House 257-167 Tuesday night, will delay the trigger cuts known as “sequestration,” which have been set to hit just about every government agency—including the U.S. Department of Education—on Jan. 2. Under the deal, the cuts will be postponed until March, giving federal lawmakers time to craft a broader budget agreement. The deal was worked out at the 11th hour by Vice President Joe Biden and Sen. Mitch McConnell, R-Ky., the Senate minority leader.

In the House, where approval seemed touch-and-go most of Tuesday, nearly every Democrat voted for the bill, while 85 Republicans supported it. Sixteen Democrats, and 151 Republicans voted against the measure.

To help pay for the postponement of the trigger cuts—which would slice 8.2 percent from a wide range of programs, including K-12 education—lawmakers have agreed to $12 billion in revenue increases, plus $12 billion in spending cuts, including $6 billion from domestic programs, according to published reports. It’s unclear how, and whether, those cuts would affect education spending.

The deal essentially sets up yet another major fiscal fight later on this year. Congress will need to come up with new legislation to cope with sequestration by March. That could involve a fresh round of domestic-spending cuts, which, in turn, could put education programs on the chopping block.

Plus, the federal government is operating on a temporary budget, called a continuing resolution, which expires at the end of March. Lawmakers will have to figure out a final budget for fiscal year 2013, which began back on Oct. 1, or face the prospect of a government shutdown.

To top it all off, the nation has hit the federal debt ceiling yet again, meaning that the government will need new legislation to be allowed to borrow more money—and keep agencies and programs in business. A measure to deal with that issue will also need to be approved in the next couple of months.

Education advocates fear the result may well be more chaos, since it was the last deal to raise the debt ceiling, back in August of 2011, that put sequestration in place to begin with. Republicans have said they do not want to raise the debt ceiling without reducing spending.

All this adds up to a lot of continued uncertainty for school districts and their advocates.

The fiscal-cliff deal is “sort of like a temporary stay of execution,” said Joel Packer, the executive director of the Committee for Education Funding, a lobbying coalition. “We’re hoping we get pardoned. .... It just creates sort of another cliff two months from now.”

And the next fiscal year, 2014, could prove to be even more difficult, Packer said, in part because of the reduced domestic spending in the budget agreement, and in part because the Pell Grant program, which helps low-income students cover the cost of college, continues to eat up a bigger share of education funding. The program, which is exempt from sequestration, faces a structural deficit, in part because of higher demand for the grants as more students enroll in postsecondary education.

Randi Weingarten, the president of the American Federation of Teachers, a 1.5 million member union, urged House lawmakers to vote in favor of the fiscal cliff package, while acknowledging that it is “imperfect,” in part because schools will continue to face budget uncertainty.

“As important as this relief is right now to the majority of Americans, this is a temporary, Band-Aid solution,” said Weingarten in a statement. “Kicking the can down the road for two months means that we still face the possibility of staggering and debilitating cuts to public schools, health care and services that our kids and families count on.”

If the sequestration cuts do end up going through in March, most school districts wouldn’t feel the pinch until the start of the 2013-14 school year, because of the way that key programs, such as Title I grants for districts and special education aid, are funded. That gives districts a planning window to figure out how to implement the cuts without hurting student achievement—and it gives Congress and the Obama administration more time to work out a deal.

But other programs, such as the Head Start preschool program for low-income children, which is administered by the U.S. Department of Health and Human Services, would be cut right away. And the impact-aid program would feel the sequestration sting in April, when districts receive their next payments. That program helps districts with a large federal presence, such as a military base. More on the cuts here.

One thing is almost certain: Congress will be very busy over the next several months trying to figure out solutions to these various fiscal puzzles. That leaves less time for education legislation—meaning that pending renewals of programs governing special education, community and development grants, higher education, career and technical education, and workforce development—not to mention the long-stalled reauthorization of the Elementary and Secondary Education Act (currently known as No Child Left Behind)—could continue to sit for a while.

Still, there’s some good news for education programs in the deal. Key tax provisions, including the American Opportunity Tax Credit, which helps families afford college, were extended. And the deal includes an extension of the Qualified Zone Academy Bond program, as well as a tax credit that helps teachers purchase supplies for their classrooms.

Photo: President Barack Obama and Vice President Joe Biden walk away from the podium at the White House after the President thanked Congressional leaders for their role in Tuesday night’s passage of the “fiscal cliff” legislation. (Charles Dharapak/AP)

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