Plan Would Boost Competitive-Grant Funding

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The Clinton administration is hoping this year to raise substantially the amount of federal education dollars distributed on a competitive basis. Such a move would build on a category of federal spending that, while still relatively small, has grown rapidly in the past few years.

Although the issue may not attract much public attention as Congress takes up the reauthorization of the Elementary and Secondary Education Act, congressional aides will likely spend considerable time behind the scenes discussing the move toward competitive grants. And, the debate, while less than glamorous, holds implications for many schools.

Department of Education officials and other advocates of increased competition say increasing the amount of competitive grants allows better concentration of funding and rewards well-planned school efforts. But some critics worry that those most in need of federal money--generally urban and rural districts serving disadvantaged students--are likely to lose out.

Competitive programs have consistently "underrepresented the needs of the neediest districts," said Jeff Simering, the legislative director of the Council of the Great City Schools, which represents the nation's largest urban school districts.

Competitive federal funding has increased significantly in recent years, particularly with the emergence of federal K-12 technology and after-school programs, among others, that allocate money through a competition run either by the federal government or by states.

To be sure, competitive dollars are still dwarfed by those distributed according to a formula.

In the current fiscal year, approximately $18.4 billion in overall K-12 funding will be doled out through formula programs, compared with roughly $3.1 billion for competition-based grants, according to department estimates. This includes competitions the department runs directly and money it sends by formula to states under the proviso that the states must divvy up the money through competitive grants. The total for competitive grants has roughly doubled in five years. In fiscal 1994, approximately $1.5 billion was competitive, compared with $12.9 billion in formula dollars, the department estimates. Annual K-12 spending grew by $7 billion overall in the same time period, from $14.4 billion in 1994 to $21.4 billion in 1999.

Performance Goals

Competitive funding would grow further under Clinton administration proposals this year. For example:

  • The administration's ESEA plan would make the $439 million in state formula grants under the Safe and Drug-Free Schools and Communities Program into competitive grants.
  • The administration also hopes to triple funding for its competitive 21st Century Community Learning Centers initiative, which pays for after-school programs, from $200 million to $600 million.

Much of the department's technology funding, which has risen substantially in the past few years, is also competitive.

For example, the Technology Literacy Challenge Fund, launched in fiscal 1997, requires states to distribute funding on a competitive basis. It received $425 million in fiscal 1999, the current budget year. The Technology Innovation Challenge Grants, begun in fiscal 1995, will send $115 billion straight from the federal government to districts this fiscal year.

In a recent interview, Marshall S. Smith, the acting deputy secretary of education, said competition is a sound strategy when a program has limited funding. Grants under the safe and drug-free schools program, for example, now average less than $10 per child. With that in mind, the program should move away from formula grants to competitive funding, Mr. Smith said. "You need more money than that" to run an effective program, he said.

In addition, Mr. Smith said, competitive grants tend to prompt better planning and better programs.

"You have to think hard about what you're going to do with [the money]," he said. "[Competition] increases the odds that you'll have high-performance programs." He argued that competition is especially effective when crafting new strategies, including after-school programs.

But critics such as Bruce Hunter, the chief lobbyist for the American Association of School Administrators, worry about the overall growth in competitive-grant funding. In addition to concerns that needy districts may not be able to hire grant writers to get the dollars, Mr. Hunter argued that competitive grants are not dependable.

"You need a stable supply of funding," he said. "Nobody hires permanent staff out of short-term grants." Mr. Hunter also warned of what he called the "golden rule" of such aid: Competitive grants give the grant-issuing body "much greater control over what you do."

Some competitive programs, such as the 21st Century Community Learning Centers initiative, are designed to ensure that needy districts get funding. And, according to Mr. Smith, those efforts appear to be succeeding. He cited a department analysis of 176 grants awarded this month under the program. According to the data, 74 percent of the grant winners had enrollments in which more than half the students were eligible for free or reduced-price lunches, compared with 60 percent of the unfunded applications.

Still, many districts are inevitably left out. While 176 grants were awarded, that is a small proportion of the more than 2,000 applications the department received. "There will be some left out, absolutely," Mr. Smith conceded.

On the Hill

Gordon S. Ambach, the executive director of the Council of Chief State School Officers, said it's important in discussing competitive-grants programs to distinguish between those administered at the federal level and those run by states.

Mr. Ambach suggested that when a competitive program begins to grow in size, exceeding roughly $50 million, states should take over to ensure better consistency with state and local efforts.

But Mr. Simering of the Council of the Great City Schools countered that states are less reliable than federal officials in getting money to where it's needed most. "The states have a tendency to want to spread it around," he said.

Competitive grants draw mixed reviews on Capitol Hill. In a recent interview, Rep. George Miller of California, a senior Democrat on the House Education and the Workforce Committee, said one motivation in creating competitive grants is frustration with lackluster results from some formula grants. Competitive programs also can spark innovation, he said.

But, Mr. Miller added, "in some cases, [a competitive program is] a substitute because Congress just doesn't have the will" to sufficiently fund an initiative.

Vic Klatt, the education policy coordinator for Republicans on the Education and the Workforce Committee, called competitive grants a "mixed bag."

He said they underscore the need for high-quality education projects, but create problems as well. The committee earlier this year asked the General Accounting Office to conduct a detailed study of the federal grantmaking process.

"If you have the best grant-writer, you have a better chance of getting the money,'' Mr. Klatt asserted. He added that competitive grants create a "difficult and complex system for schools to negotiate."

Vol. 18, Issue 37, Pages 20, 22

Published in Print: May 26, 1999, as Plan Would Boost Competitive-Grant Funding
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