Bill Could Send Ed. Dept. Staff Back to Work

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Congress was expected to vote on a measure late last week that would put 280,000 furloughed federal employees back on the job through Jan. 26, although many agencies, including the Department of Education, would remain without full funding.

House Republicans said they would also propose a bill to fully fund federal programs through Jan. 26 if President Clinton proposes a seven-year balanced-budget plan that is acceptable to GOP leaders.

Even though federal school dollars resumed flowing to states and districts last month after a reinterpretation of furlough rules for the Education Department, the ongoing budget impasse that had closed most of the department and other agencies was exacting a growing toll last week.

Unopened student-loan applications piled up by the thousands, no one was available to review research-grant applications, schools for American Indian students were plagued with funding problems, and districts dependent on the impact-aid program were nearing a funding crisis.

But a more widespread crisis was avoided when the White House--under pressure from GOP lawmakers--changed its interpretation of furlough rules and returned 30 Education Department finance-staff members to work Dec. 20.

By Jan. 3, they had processed $350 million in payments under Title I, Pell Grants, and other programs that are still distributing funds appropriated in fiscal 1995, which ended Sept. 30.

"We're getting payments out, but we're not doing other work. The monitoring process is down the tubes," said Donald R. Wurtz, the department's chief financial officer. "It seems like a stupid way to run a railroad."

Reprieve in Sight?

That situation could improve somewhat this week, as Republicans agreed late last week to a plan that would return employees to work and fully fund some popular programs that currently are without a fiscal 1996 appropriation, including child-welfare programs and Head Start.

"We're delighted to see that employees are back in and we'll try to provide as many services as possible," said Undersecretary of Education Marshall S. Smith.

But the Education Department--one of several agencies that are partially shut down because the 1996 appropriations bills that fund them are stalled or have been vetoed--would still have no new operational funds. Department officials said that any travel-related work on program monitoring, enforcement, or investigations would still be barred, and some contractors would continue to go unpaid. It was unclear whether the plan would allow the agency's workers to make long-distance phone calls.

President Clinton is expected to sign the stopgap spending measure, HR 1643, although he had not said whether he would submit a budget plan meeting GOP criteria to fully reopen the government.

After opening the second session of the 104th Congress Jan. 3, lawmakers unsuccessfully tried to override four Clinton vetoes, including his veto of a bill that would end funding for the AmeriCorps national-service program.

Indian-School Woes

These maneuvers did not impress school officials who saw their situation growing increasingly desperate.

With the Department of the Interior shut down, four Bureau of Indian Affairs schools in North and South Dakota were down to a day or two of heating oil and had no way to buy new oil last week when temperatures fell below zero.

"There weren't any government employees who could process those payments," said William A. Mehojah, the acting director of Indian education programs.

Bureau officials told schools to use building-maintenance funds to buy heating oil and pay utility bills. Mr. Mehojah said the bureau's 187 schools can remain open for at least 30 days more this way.

The Hopi Tribal Council in northeast Arizona adopted a resolution last week declaring the impasse "no longer acceptable," in part because of school problems.

More schools might have found themselves in dire straits if the Education Department had not resumed processing fiscal 1995 funds--something that did not happen during the six-day partial government shutdown that occurred in November. (See Education Week, Nov. 22, 1995.)

After that shutdown, Republicans argued that the department could have kept workers on the job to process funds from the 1995 budget. That includes funds for all K-12 programs other than impact aid, which are "forward funded" and pay out most of their money the year after it is appropriated.

Change of Position

Rep. Pete Hoekstra, R-Mich., the chairman of the House Economic and Educational Opportunities Subcommittee on Oversight and Investigations, charged in a Dec. 18 letter that the department may have held 1995 aid "to force compromise on the 1996 appropriation, thus increasing the impact of the shutdown on as many individuals and institutions as possible."

Department officials said that they were following governmentwide policy on which employees can work during a shutdown, and changed their position after the White House Office of Management and Budget said that workers could be retained to process already-approved funding.

"It wasn't a political judgment," said Undersecretary Smith. "It was a legal judgment."

In any case, the change does not affect programs that are not forward-funded and require fiscal 1996 appropriations to make payments. The only Education Department programs in this position are vocational rehabilitation and impact aid.

While stopgap continuing resolutions were in effect in November and December, providing a reduced level of new funding, the Education Department was able to send $44.7 million to the schools most dependent on impact aid, which goes to districts whose tax bases are affected by the presence of federal property or workers.

"A lot of schools said they'd be OK till the beginning of the year," said Pauline Proulx, the spokeswoman for the National Association of Federally Impacted Schools. "But the longer this lasts, the worse it's going to get for a lot of them."

HR 1643, which would provide no new 1996 funding, would not help those districts.

A Growing Impact

Although many checks were in the mail last week, other work had been idled and federal officials were not available to assist educators in states and districts.

In Delaware, for example, education officials were drafting charter school guidelines, and wanted some help from Washington.

"We know there are people at the department who have dealt with this, and we need to talk to them to make sure we make good decisions," said Robert V. Breshahan, a team leader in the financial-operations office of the state education department.

And by early last week, an estimated 100,000 applications for college financial aid, many for high school seniors planning for next fall, had arrived.

"They're unprocessed now and are continuing to stack up," Mr. Smith, the education undersecretary, said.

Mr. Smith said that applications for research-and-development grants that were supposed to be mailed out by Jan. 1 would likely be delayed by about three weeks.

"This could shorten the period to write grants and get out grant money," he said.

And another problem faces districts trying to prepare budgets for the 1996-97 school year: They do not know how much money they will receive under the 1996 Education Department budget. Most of that aid would begin flowing July 1.

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