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Budget Deal Could Offer School Districts Relief from Sequestration

By Alyson Klein — December 10, 2013 4 min read
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School districts would get some relief from the across-the-board cuts known as sequestration under an agreement announced Tuesday by a bipartisan pair of House and Senate negotiators.

The plan would roll back most of the so-called sequester cuts for the next two years, leaving the door open for federal lawmakers to boost spending on disadvantaged children and students in special education. UPDATE: The agreement passed the U.S. House of Representatives 332-94 on Thursday and now will need Senate approval.

The proposal, which was crafted by the top budget lawmakers in each chamber, U.S. Sen. Patty Murray, D-Wash., and U.S. Rep. Paul Ryan, R-Wis., would restore about 87 percent of total spending on domestic discretionary programs, the giant category that includes education, according to an analysis by Joel Packer, the executive director of the Committee for Education Funding, a Washington lobbying coalition. The coalition began trying to get rid of the sequester cuts to education programs even before they were implemented last March.

“Obviously, this isn’t the ideal situation we’d hoped for, but to be honest, it’s better than we could have expected,” Packer said.

Mary Kusler, the director of government relations for the National Education Association, a 3-million member union, had a somewhat similar take.

“We believe that this is an important first step in relieving some of the horrible cuts that have impacted schools across the country,” she said. But she added, “In our opinion, we would have liked to see [the agreement] go further.”

Lawmakers have been really vocal about cuts to big formula programs that go out to every school, including Title I grants to districts and special education state grants. They’ve been a lot quieter about the squeeze on the Obama administration’s favorite competitive grant programs, such as Race to the Top. And most advocates representing practioners, including the NEA, are more likely to go to bat for formula programs.

And under the still-constrained overall spending level, any brand-new initiatives, such as the Obama administration’s big preschool push, will likely face long odds.

“There’s still a lot of work to be done,” Packer said. “It’s going to be very interesting to see how do they divide this money up. ... I think, to be honest, anything new ... I just don’t see how that happens.”

In fact, Kris Perry, the executive director of the First FIve Years Fund, which advocates for early childhood education, released a statement soon after the agreement was announced expressing disapointment that it did not make room for a big new investment in preschool. The agreeement would include language opening the door to further preschool funding, but it doesn’t provide any tangible new resources.

Some background: The sequestration cuts amounted to an across-the-board reduction of about 5 percent on federal education spending largely during the 2013-14 school year. So far, sequestration has had an uneven impact on K-12. Some schools have barely noticed the cuts, while others, including districts that get federal Impact Aid, have been pummeled by them. Head Start, an early-childhood education program for low-income children, was hit particularly hard, cutting 57,000 slots.

Just because Ryan and Murray have agreed on this plan doesn’t mean it’s a done deal. The proposal, which has gotten the thumbs-up from congressional leaders, will still need to be approved by both houses of Congress, and signed by President Barack Obama. And a lot of folks are expecting opposition in both houses, particularly from conservative Republicans, who thought sequestration was a step in the right direction when it comes to reining in the deficit.

The plan would cap this year’s spending levels at $1.021 trillion, about halfway between what the House and Senate approaches. It includes more than $20 billion in deficit reduction in addition to the changes to sequestration. It would pay for all of this through permanent cuts to a host of other federal programs. For instance, it would ask some federal employees to contribute more toward their pensions. That particular change didn’t sit well with the NEA, which represents some 8,000 federal employees, Kusler said.

And some of the cuts would affect the student loan program. For example, non-profit organizations that service student loans no longer would be paid using mandatory (essentially, automatic) federal funds. Instead, they’d get their payments from the discretionary side of the ledger. Much more for budget wonks here.

Ryan, who was attacked when he ran for vice-president in 2012 for what some saw as a plan to cut education spending, said he sees the agreement as “a step in the right direction. ... In divided government, you don’t always get what you want.”

And Murray, a former preschool teacher, underlined the impact of sequestration on education: “Our deal puts jobs and economic growth first by rolling back sequestration’s harmful cuts to education, and medical research, and infrastructure investments, and defense jobs for the next two years.”

Both lawmakers stressed that the plan would mean some fiscal stability for the next two years—and a reprieve from the threat of federal government shutdowns.

So, if this plan passes, does that mean that sequestration is definitely gone for good? Not necessarily. The cuts, which originally were part of a deal to raise the debt ceiling, are supposed to be in place for a decade, unless lawmakers do something about them. This agreement would only stave off the majority of the cuts for two years, giving lawmakers time to work out a broader agreement on a mix of taxes, spending, and changes to entitlement programs. However, Kusler, for one, is worried that the spending cuts both parties could readily agree on were included in this deal, giving lawmakers less common ground to start from next time around.

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