Will Title I Set-Aside Dilute Immediate Impact of Stimulus?

March 06, 2009 1 min read

What will happen with the Title I set-asides?

The answer will have big implications on how quickly $2 billion in stimulus money is spent. State and officials are waiting for guidance from the Department of Education, which is expected soon.

The background: NCLB added a requirement that districts receiving Title I grants offer public school choice and free tutoring to students whose schools fail to make AYP for several years. The law requires districts to reserve up to 20 percent of their allocations for those services. If districts don’t spend all of that money in one year, they can use it on their regular programs the next year. Because participation rates in choice and tutoring have been low, just about every district in the program has been carrying over money from one year to the next.

Back in October, then-Secretary of Education Margaret Spellings issued a new set of rules demanding that school districts ensure parents know about their options for choice and tutoring. She also made it more difficult for districts to roll over unspent money from one year to the next. Lobbyists representing school districts want to put those rules on hold.

When Spellings published those rules, no one expected that the next president would be giving districts a $10 billion bonus in Title I money for fiscal years 2009 and 2010. With the money in place, school officials are wondering whether they’ll need to reserve $2 billion for choice and tutoring.

If they do, it may dilute the stimulus law’s immediate effect. A large portion of Title I’s share of the stimulus might not be spent immediately as districts reserve money for services that parents and students may not be demanding.

The Department of Education is expected to weigh in soon, possibly as early as next week. Watch closely to see how strictly the new administration interprets the law and Spellings’ regulations.

A version of this news article first appeared in the NCLB: Act II blog.