Federal Education Funds for States Stable, Study Finds

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Major shifts in the distribution of federal funds to state and local governments have occurred during the last two years, but federal aid for education has remained relatively stable during that time, according to an analysis by the Federal Funds Information for States System, a research arm of the National Governors' Association.

Education has, in fact, "fared comparatively well," said Carol Weissert, a spokesman for the nga, which operates the research unit in conjunction with the National Conference of State Legislatures. The system provides state and local governments with a state-by-state accounting of federal grants-in-aid3to domestic programs.

Aid for education increased by 13 percent from 1982 to 1984, according to the ffis report, "An Analysis of Federal Grants." In "real" dollars, "that represents an increase above the inflation rate of 1 to 3 percent," said Victor Miller, director of the system.

Education programs receiving the largest increases in aid over the two-year period were impact aid, which received a 30-percent increase, and handicapped- and compensatory-education programs, both of which received increases of almost 15 percent, Ms. Weissert said.

Although the total amount of federal aid to states and localities has remained virtually the same during the last two years, the statistics show, there have been marked changes in allocations to program areas and in distribution within geographic regions of the United States.

The largest fluctuations in federal aid to programs were in the areas of transportation (45 percent more aid), national defense (38 percent more aid), health (19 percent more aid), natural resources and environment (28 percent less aid), and training and employment (21 percent less aid), the ffis statistics indicate. The statistics do not account for inflation.

Geographical Shift

The figures also indicate that there has been a major shift in federal aid geographically.

"The New England states received an increase of less than four-tenths of 1 percent over the three-year period," the report states. "Federal grants to the Rocky Mountain states went up by 24 percent. Federal aid to the Southwest and Great Lakes and Plains states also increased more than the national average of 8 percent."

Much of the regional fluctuation is due to demographic changes and their effect on federal-funding formulas for various programs.

Because the population is decreasing in the Northeast and increasing in the Southwest, the report explains, federal formulas based on population reflect those changes.

Changes in Medicaid grants resulting from shifts documented in the 1980 census are the most significant, the report states, since Medicaid represents more than 20 percent of federal aid to state and local governments--$21 billion in 1984.

Other formula changes that have affected federal funding patterns have occurred in highway, mass transit, and job-training programs, the ffis report says.

Vol. 03, Issue 16

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