How Much Federal Money Do Schools Need to Survive the Coming Financial Blow?

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America’s public schools will need $70 billion for three consecutive years in the next round of federal stimulus spending to avoid painful cuts such as teacher layoffs, according to a new analysis.

That level of spending—from fiscal analyst Michael Griffith—would help blunt the dramatic budget cuts that districts will likely be forced to make because of the economic fallout brought on by the coronavirus pandemic.

The $13.5 billion CARES Act, as the first round of stimulus spending is known, will not spare most school districts from needing to make budget cuts this fall, he said.

See Also: Coronavirus Stimulus for Schools: Calculating What Your State Gets and What It May Need

Griffith said any new dollars should be targeted toward states with high rates of coronavirus infections and where school districts are more dependent on state aid. The existing CARES Act funds are being distributed based on the Title I, part A formula, which considers several factors including the size of districts, poverty rates, and levels of local and state aid.

The CARES Act for most states can only stave off budget cuts up to 8 percent, Griffith said. But most states now are projecting cuts next year anywhere from 8 percent in Kansas to 20 percent in Alaska. And those cuts will be felt most acutely in the K-12 sector, which is heavily reliant on state aid.

“There will be very few districts that will be pulling out of this quickly,” said Griffith, who will soon join the Learning Policy Institute as a senior school finance researcher and policy analyst.  “If there is another round of federal money going out, we can’t spend it all in the first year.”  

Congress is expected to reconvene in May to debate another stimulus package, but there seems to be little appetite, especially in the Senate, for a bailout of school districts considering the high unemployment rate.

As Education Week reported recently, Griffith has done a data analysis to show how much money the CARES Act provides states and allows users to determine how much money they think states should receive in the next round of stimulus funds.

As they fight the spread of the coronavirus, many states, have almost drained their rainy day funds to prop up local health departments, buy masks and ventilators, and send out unemployment checks. That means less money for schools in those states especially hard hit by the virus, Griffith said.

Ary Amerikaner, the vice president for P-12 policy, practice, and research for EdTrust, an advocacy organization that pushes for greater accountability and more equitable spending, said the next stimulus package should be used to extend the school year for struggling students and be in the range of $100 to $200 billion.

She thinks Congress should continue to use the Title I formula for sending out the aid because, she said, it’s familiar and pushes for equity between states and districts. Some advocates believe it to be a deeply flawed way to divvy up money for schools.

“Congress should be ensuring those dollars are spent on things that we know will accelerate learning for those students who are most impacted by the shutdown such as summer school, additional school, or tutoring,” she said.  

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