Special Report
Budget & Finance

Fiscal Stability Allows for Long View on Stimulus

By Alyson Klein — February 05, 2010 8 min read
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Even as school officials across the country continue to weigh cutbacks because of the still-bleak economy, Greg Murry, the superintendent of this 9,000-student district, faces an enviable challenge: how to spend, within a tight time frame, an economic-stimulus windfall of up to $7 million.

Instead of just filling budget holes as it did elsewhere, the American Recovery and Reinvestment Act passed by Congress last February offered Arkansas—one of the few bright spots in a dismal national landscape for K-12 spending—a rare opportunity to make lasting investments in student outcomes.

Conway, about a half-hour’s drive from Little Rock, is trying to make the most of the infusion of federal aid without making spending commitments it can’t continue when the money dries up.

Schools and the Stimulus:
A Midterm Report
Dueling Objectives Mark Stimulus at Halfway Point
The Impact So Far
Multiple Stimulus Aid Streams Flow to Ed Tech
Private Sector Competes for Share of Stimulus Pie
Spec. Ed., Title I Aid Casts Long Stimulus Shadow
Stimulus Reflects Push for Teacher Effectiveness
Schools Stuck at Bottom Target of $3 Billion Push
Aid Lets Hard-Hit State Keep Programs Aloft
Fiscal Stability Allows for Long View on Stimulus
The Road Ahead
As Education’s Funding Cliff Nears, Anxieties Rise
Race to Top Sets Stage for ESEA Reauthorization
Web Extras
Live Webinar: Is the Stimulus Metting Its K-12 Goals?
Live Chat: Schools and the Stimulus: A Midterm Report
Interactive Map: Follow the Stimulus Money
Videos on the Stimulus

“We don’t want to waste the money that our patrons have given us,” Mr. Murry said. “We want it to be focused towards student achievement.”

The $787 billion recovery act is pumping up to $100 billion in one-time education funding into state coffers with little regard for how much those states have been squeezed by the economic downturn.

Its main vehicle for putting education spending back on a firmer footing, the $48.6 billion State Fiscal Stabilization Fund, distributed aid to states on the basis of state population, not need. The money was primarily intended to backfill cuts to K-12 and higher education.

But Arkansas, which got $443 million in stabilization aid, didn’t have any K-12 cuts to restore. In fact, it has increased funding for public schools by about $700 million over the past several years, in part because of new legislation stemming from a school finance lawsuit.

That meant that some $341 million in state stabilization money was slated to flow to Arkansas districts through the Title I formula for aid to disadvantaged students, after the state filled in a slight cut to higher education. Revenue has been more sluggish than expected this year, so districts were warned not to spend their $119 million second allotment of stabilization funding until it is clear that there won’t be cuts to restore.

That money came on top of an unprecedented increase for Arkansas of $106 million in Title I grants and $112 million in new money for students in special education, also provided by the stimulus law.

Districts can spend their state stabilization dollars on any activity authorized under one of four major federal laws: the Elementary and Secondary Education Act, the Individuals with Disabilities Education Act, the main law on career and technical education, and the law dealing with adult and family literacy. They also can use the money to renovate and repair facilities.

First grade teacher Torrie C. Achan, center, talks with other teachers during a professional-development session at Theodore Jones Elementary School in Conway, Ark. The school used part of the money it received through the federal economic-stimulus program to expand professional development.

Arkansas districts have taken advantage of all those options.

State officials’ message to Conway and other districts was two-fold: Don’t spend money on hiring permanent employees if those positions can’t be sustained after the federal dollars are gone; and, to the extent possible, target the money to programs that will help improve student outcomes for years to come.

“That was the biggest challenge, getting districts to see this bigger picture: that these funds could have an impact on student achievement,” said Tom W. Kimbrell, the state commissioner of education, who came to the job in late September.

He said that if the state—and the nation—can’t show that students have benefited from the money, the federal government will be hesitant to increase education spending again.

“We finally got the federal government to understand that there is a huge need for an infusion of money into education,” he said. “If we don’t use it to really impact student achievement, we’ll never be able to ask again.”

Targeted Dollars

In submitting stimulus-spending plans to the state, Arkansas districts had to explain what education redesign objectives they would be furthering through each of their expenditures—even if they were asking for money just to refurbish a restroom.

Districts that weren’t specific had their applications sent back. Any district that said it planned to hire new staff members had to explain how it intended to pay for the new employees after the stimulus dollars went away. Districts that couldn’t point to a funding stream were rejected.

Much of the Arkansas fiscal-stabilization money went to school facilities, particularly renovation and modernization projects, such as new science labs or school additions. Such spending was partly to avoid starting new programs that couldn’t be sustained after the funding runs out next calendar year, Mr. Kimbrell said.

A mural illustrates local history in downtown Conway. The school system is trying to spend its federal economic-stimulus aid carefully.

The Conway district plans to spend the bulk of its up to $4 million in fiscal-stabilization funding on facilities.

Some projects have already been completed. The old wooden lockers at Carl Stuart Middle School were replaced with shiny new metal ones. The school also got a new set of doors that don’t stick open; they’ll help prevent break-ins.

Classrooms across the district got new paint jobs. Some schools got new floors and ceilings. Light fixtures were replaced with models that are more environmentally friendly. HVAC systems were retrofitted, allowing the district to save on future energy costs.

And the stained, decades-old sinks and toilets in the restrooms in Joy Bateman’s 1st grade classroom at Sallie Cone Elementary School were replaced with gleaming-white fixtures that aren’t as prone to clogging, Ms. Bateman said. Other restrooms in the districts were also refurbished.

Superintendent Murry joked that much of the improvement is just “lipstick,” but he said that students, teachers, and the community have taken note of the changes.

Mr. Murry said he is “most personally proud,” though, of a program that he financed using part of Conway’s more than $1 million in extra Title I funds: a six-week summer enrichment program that served 125 struggling pupils in grades K-4. The district plans to the operate the program again for the next two summers, with even more students taking part. If it shows results, Mr. Murry hopes the district can find the funds to continue it after most stimulus funding ends.

Principal Uses Stimulus Aid for Renovations at Her School

Districts’ Choices

Conway also spent a chunk of its extra Title I aid on professional development. Coaches from the University of Arkansas at Little Rock came to help teachers at one elementary school with their literacy program. The partnership has allowed teachers to observe and critique one another’s lessons, as well as providing for common planning time.

Some Arkansas districts spent their Title I windfalls on technology, such as student-responder systems, an education technology that allows students to provide real-time answers, and training for teachers in how to use it. Others districts, particularly in isolated rural areas, invested in distance learning.

And some, like Conway, have used Title I money to develop partnerships with universities and school improvement specialists. Activities have included implementing the state’s new, differentiated accountability plan.

Some of the Arkansas stimulus money did go to teacher salaries, particularly in the largely rural eastern part of the state, where districts used money for recruitment and retention programs aimed at keeping highly qualified teachers.

State officials encouraged districts to tie bonuses for teachers, at least in part, to student outcomes, said Julie Thompson, a spokeswoman for the Arkansas Department of Education, and some districts heeded that advice. Guidelines for the $4 billion in Race to the Top Fund grant competition encourage such pay plans.

Districts also got a hefty new injection of special education money. It has been spent largely on bringing facilities into compliance with the guidelines in the Americans with Disabilities Act and on technology, including computer-based assessments for special-needs students and on interactive classroom whiteboards.

Some districts also used part of their special education funding for professional development, including sending general education teachers back to school to get special education degrees, or training special education teachers to work with additional groups of students.

Initially, Mr. Murry said, he got questions from staff members about why the district wasn’t using its up to $7 million in stimulus money to raise salaries or hire personnel. He explained to teachers and principals that the money was a one-time bump, not a lasting funding stream.

“We could have chosen to hire people for a short time,” he said. But, he added, “I don’t want to insert teachers in the classroom, then immediately pull them right back out.” That’s been a common concern statewide.

All the spending decisions by school districts have taken time and staff resources, and even well-financed Arkansas has run into capacity issues. As of late January, about 20 districts, out of some 260, hadn’t yet filed applications for their stimulus aid, often because of leadership changes or because they were eligible only for a small amount, state officials said.

Last summer, Charlotte Vann, who oversees the Conway district’s federal programs, found herself e-mailing the Arkansas education department questions—and getting them answered—on the Fourth of July.

But it’s been worth it, she said, explaining that Conway wanted to get its application approved in time to run the summer program.

“We just wanted to be very sure with this kind of opportunity that we weren’t just throwing money out there towards something that was not prudent,” Ms. Vann said. “You bet we did whatever it took to make sure this was working for our kids.”

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Coverage of the American Recovery and Reinvestment Act is supported in part by grants from the William and Flora Hewlett Foundation, at www.hewlett.org, and the Charles Stewart Mott Foundation, at www.mott.org.
A version of this article appeared in the February 10, 2010 edition of Education Week as State’s Fiscal Stability Allows for Long View


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