Policy Brief

Stimulus Spending Still Plods Along

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Even as states and school districts complain about the slow economic recovery and warn about the prospect for draconian teacher layoffs, billions of economic-stimulus dollars remain in the bank waiting to be spent.

As of June 30, districts across the country had $7.8 billion in stimulus-related Title I funds for disadvantaged students to spend, out of $11.8 billion that the U.S. Department of Education has already approved. And $7.3 billion in special education aid, out of $12 billion, remains to be spent, according to department data.

The Education Department has until Sept. 30 to authorize the spending of nearly $100 billion in education aid through the American Recovery and Reinvestment Act passed by Congress last year. The department still has to hand out some of that money—for example, $3.4 billion in Race to the Top competitive grants and $650 million in Investing in Innovation funds.

States and districts have another year to spend the money. A recent Education Department webinar on stimulus spending showed, however, that 48 percent of participants were worried about spending all their money by the deadline, according to the Association of School Business Officials International, based in Reston, Va.

In all, the Education Department has authorized spending for $87 billion in stimulus aid, and states and districts have yet to spend about 40 percent of it.

The slowest spenders are Delaware, with 73 percent of its stimulus funds remaining, and Alaska, at 72 percent. The fastest spenders are Iowa, with just 20 percent of its money remaining, and Illinois, at 21 percent, according to the department’s data.

For their part, federal officials aren’t too worried.

“As long as the current pace of spending continues in the coming year, we project that the remaining 60 percent will be committed by Sept. 30, 2011,” said Education Department spokesman Justin Hamilton. And what happens if the districts or states leave money in the bank after the deadline?

It goes back to the U.S. Treasury.

Vol. 29, Issue 36, Page 19

Published in Print: July 14, 2010, as Stimulus Spending Still Plods Along
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