Budget & Finance

6 Tips For Making the Most of ESSER Dollars Before They Expire

By Mark Lieberman — May 16, 2023 6 min read
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The Upper Moreland school district wanted to use federal COVID relief dollars to contract with a speech therapist. So the district sought services from outside contractors that employ speech therapists.

The only problem? “They face the same staffing challenges we face,” said Matthew Lentz, chief financial officer and board secretary for the 3,300-student district in the suburbs of Philadelphia. “If they can’t staff it, you’re back to square one.”

Lentz’s team eventually hired someone in-house, but that process took a while, and that person started in their role six months later than planned. For all that time, the district had committed to spending ESSER dollars but couldn’t actually get them out the door.

Districts across the country are eyeing spending deadlines for the money Congress sent them in three rounds during the first year of the pandemic. The due date for the first round, known colloquially as ESSER I, has already passed. ESSER II expenses must be committed by Sept. 30 and spent by January 2024. ESSER III expires one year later—which means the upcoming school year will be the last during which districts can use pandemic relief aid to pay for services and make strategic investments.

Some districts are already well on their way to spending their full allotment. The Mansfield district in Texas, for instance, has allocated all $29.5 million it received for ESSER III to priorities like curriculum support, tutoring programs, instructional coaches, summer schools, technology tools, and bonuses for staff, said Michele Trongaard, the district’s associate superintendent for business and finance.

The district still has roughly $10 million of that sum to spend, mainly on the remaining paychecks for ESSER-funded staff members.

But many districts are further behind, with thousands or even millions of dollars left to allocate and spend. As of earlier this month, federal data showed schools nationwide had spent nearly all of their ESSER I money, roughly three-quarters of ESSER II funds, and slightly more than one-third of their ESSER III allocation, according to a FutureEd analysis. That doesn’t account for the likely billions of dollars schools have committed but not yet spent, and it likely reflects a data lag of at least several months.

Most district leaders are eager to find productive uses for those funds, if they haven’t already.

“I know there’s a perception that, ‘We’re going to leave all this money on the table.’ I can guarantee you I’m not leaving a penny on the table,” Susan Enfield, superintendent of the Washoe County schools in Nevada, said during a March panel at the SXSW EDU conference in Austin. (Enfield is chair of the board of trustees for Editorial Projects in Education, the nonprofit publisher of Education Week.)

But, she added, “I also won’t spend to spend.”

Here are some tips on how to avoid doing just that.

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Conceptual Illustration of Government taking a big chunk of the money
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Concentrate on one-time investments that will pay dividends for years to come

The U.S. Department of Education has expressed some willingness to offer flexibility to districts to spend remaining funds on construction contracts after the spending deadline has passed. But districts will likely have to endure a lengthy application process and a deluge of paperwork to make that work.

Instead, district leaders say, remaining ESSER funds should go to one-time purchases that will pay off down the road. For instance, technology that addresses school security concerns will be useful for years after it’s installed, as will replenishing school libraries and upgrading learning management systems, according to an ESSER strategy guide from Education Resource Strategies, a consultant that works with school districts on finance issues.

Use data to make decisions and keep track of investments

District leaders argue that data can serve as a powerful tool to help decide where investments are most needed.

Lentz said his team has been scrutinizing information on academic achievement and behavior from school leaders as well as preschool providers that will be sending students to the district in the coming years, and from students who migrated to cyber charter schools during the height of the pandemic but are starting to trickle back to their neighborhood schools.

“Students are not coming to us on the same level that they were previously,” a finding that has prompted the district to make major ESSER-funded investments in programs that help with foundational skills like math and reading, Lentz said.

Meanwhile, decisions on how to invest remaining ESSER dollars are most effective when they take into account insights gained from prior spending, said Joe Gothard, superintendent of St. Paul Public Schools in Minnesota.

Gothard’s district used a sliver of its ESSER funds to establish an Office of Innovation. The team’s sole purpose was to develop a progress monitoring system that could easily show administrators and the public what federal funds were fueling, and whether those investments were proving worthwhile, Gothard said.

Reallocate funds originally set aside for things you didn’t end up needing

The St. Paul school district expected to need far more personal protective equipment (PPE) than ended up being necessary, said Gothard.

Similarly, some planned hires didn’t work out, leaving more money than expected left over. That freed up funds to pay for additional reading programs and social-emotional support for students.

“I don’t want our team to find out too late it’s far less than we anticipated [and] there’s this large sum of money waiting to be spent,” Gothard said. “Trying to manage it in the day by day is really important for us.”

Be mindful of ripple effects from worthwhile investments

ESSER funds in St. Paul paid for 70 of the district’s teachers to take on a new assignment: offering courses to young students using the “science of reading” approach, for which they had all previously been trained.

“In doing so I created a 70-person vacancy in a workforce that’s already challenged,” Gothard said.

He ended up using additional ESSER money to offer signing bonuses and other incentives to attract new workers.

Don’t wait to start long-term planning

September 2024 might feel like a long way off, but it takes time to figure out how best to spend one-time funds; find contractors, vendors, or job candidates who can fulfill your needs; and submit the required paperwork to prepare for a clean audit later.

It also requires long-term planning to figure out how to sustain ESSER-funded investments after the funds dry up.

To that end, the Upper Moreland district plans to take advantage of an unexpected decline in the overall cost of special education services by reallocating some money from that line item to cover the cost of staff members’ compensation once ESSER funds run out.

Set expectations, and take notes on the biggest successes

Not every investment will work exactly as districts hope. Education Resource Strategies recommends being honest with community members when the district takes a gamble on a new strategy.

“We already know that some district initiatives won’t work in the way leaders hoped,” the group writes in its guide to spending remaining ESSER funds, which it released early this year. “But district leaders can get out ahead of this inevitability and engage their communities in learning from and evolving their work, rather than declaring promising efforts as failures too quickly.”

Lost in the chaos wrought by the pandemic, and examples of ESSER investments that didn’t work out as hoped, are success stories of using temporary increased investments in education to make a positive difference for students.

Gothard recommends district leaders keep track of their biggest ESSER-era accomplishments and make them a central component of advocacy for additional education funding down the road, whether from local taxpayers or state legislators.

“A lot of heartbreak came out of the pandemic, but to be able to tell the positive stories, could really serve to help answer the question of what does school funding look like from here,” Gothard said.

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A version of this article appeared in the May 31, 2023 edition of Education Week as 6 Tips For Making the Most of ESSER Dollars Before They Expire

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