Education Funding Explainer

Everything You Need to Know About Schools and COVID Relief Funds

By Mark Lieberman & Andrew Ujifusa — September 10, 2021 11 min read
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Federal funding to cope with the pandemic has been the talk of the education world for much of the last 18 months. The disruption caused by COVID-19 drove Congress to pass three massive economic stimulus packages that included substantial sets of funds for K-12 schools.

School districts are currently taking stock of the available funds and making plans to spend them, even as another chaotic school year is providing a hefty distraction.

The rollout of the federal aid, like most things since the pandemic began, has been frenzied, chaotic, and confusing. Education Week has assembled an educator’s guide to the basics of the aid packages: what they include, how schools can use them, what challenges they might encounter, and how school communities can shape the direction of efforts to change.

Why did schools get so much federal money during the pandemic?

The sudden nationwide closure of school buildings in the spring of 2020 brought an avalanche of unforeseen costs to districts, many of which have tight budgets and limited room for surprise disruptions. During the early months of the pandemic, the outlook for state and local revenue sources looked so dire that many K-12 observers were predicting financial catastrophe on an unprecedented scale.

The worst predictions didn’t come to pass, but schools still had to readjust their entire delivery model on the fly, while aiming to protect students and staff from a deadly virus and weathering all manner of complex political headaches. And the disruption isn’t over, as the Delta variant continues to upend early plans for a return to normalcy this fall.

How much money did my school district get?

Some school districts got nothing. Some got more than $20,000 per student. Most got something in between.

To find out how much your district got, consult this EdWeek database, courtesy of the Associated Press.

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Why did some school districts get so much more or less than others?

The relief aid followed the same formula that the federal government uses to offer Title I aid to disadvantaged students. The school districts that got the most money per student from the stimulus packages are the ones that annually get the most Title I funding.

Data from state education departments collected by the Associated Press show how much each district got from each of the three stimulus packages. The particularly important number to look at, especially when comparing one district to another, is the per-student total. It’s fairly obvious that bigger school districts would get more money overall than smaller districts. The per-student numbers offer a better sense of which districts got a significant amount of money per student, which ones got a minimal boost, and which ones got nothing at all.

Here’s an easy example to illustrate this phenomenon: The Moorestown Township district in New Jersey and the Nashwauk-Keewatin district in Minnesota both got roughly $1.4 million from the three packages combined. But Moorestown has nearly 4,000 students, while Nashwauk-Keewatin has only 623. That means Moorestown got roughly $350 per student, and Nashwauk-Keewatin got more than $2,000 per student. Both districts got roughly the same total amount of money, but Nashwauk-Keewatin got more than five times what Moorestown got per student.

See Also

An old swing-set on a playground at Heritage Elementary School in Lewis Center, OH on July 7, 2021. New construction and repairs will be paid for by a school levy since the district didn’t qualify for pandemic relief funding.
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Maddie McGarvey for Education Week
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What’s the difference between the three federal relief aid packages? What does that mean for my school district?

The first package, the Coronavirus Aid, Relief, and Economic Security (CARES) Act, emerged from Congress as a response to the early days of the pandemic, when it wasn’t clear when life would return to normal and schools were racking up emergency costs on remote learning setups and personal protective equipment.

The second package, the Coronavirus Response and Relief Supplemental Appropriations (CRRSA) Act, arrived after months of negotiations, when it had long been clear that the pandemic was not abating as quickly as originally anticipated. Republicans in Congress were initially reluctant to spend more but eventually acquiesced.

The third package, the American Rescue Plan, took shape after President Joe Biden took office and vowed substantially more federal funding to tackle the ongoing pandemic and its impacts. That plan passed in Congress on the strengths of the Democrats’ legislative advantage in the House and Senate.

Perhaps the most important difference between them is the amount of money they provide for state education departments and local school districts.

The CARES Act, passed in March 2020, provided $13.2 billion for them, while the CRRSA Act, passed in December 2020, provided $54.3 billion. The American Rescue Plan, enacted in March 2021, provided $122 billion for state and local education systems.

The American Rescue Plan included $800 million for homeless children and youth (allocated through states), which is money that wasn’t set aside specifically for them in the two previous relief deals.

The CARES Act included $180 million in “Rethink K-12 Models” grants that were awarded to states on a competitive basis. Those competitive grants were not included in the two subsequent relief deals.

All told, state education departments and local school systems got roughly $190 billion from the three legislative packages through a fund for elementary and secondary schools (more on that shortly). By contrast, K-12 education typically gets between $55 billion and $60 billion in federal funding per year, largely through Title I and other smaller grant programs. All told, K-12 schools spend roughly $730 billion from local, state, and federal sources in a typical year.

What should I call the three sets of federal relief?

You can refer to them by the dates they passed: March 2020 for the first, December 2020 for the second, March 2021 for the third.

You can call them by the names of the legislation that created them: the CARES Act, the CRRSA Act, and the American Rescue Plan, or ARP.

The main fund for state and local education systems in all three packages is called the Elementary and Secondary School Emergency Relief. Many school district administrators call them, in chronological order, ESSER I, ESSER II, and ESSER III.

How long does my district have to spend its federal money?

Each of the three packages of federal aid comes with different deadline for designating the funds for a particular purpose.

ESSER I: Sept. 30, 2022

ESSER II: Sept. 30, 2023

ESSER III: Sept. 30, 2024

Can my governor or state lawmakers influence how my school district spends federal COVID relief?

Both the CARES Act and the CRRSA included pots of money, called the Governor’s Emergency Education Relief (GEER) fund, for governors to support K-12 and higher education. Governors who provide funding to K-12 schools through GEER can identify specific uses for the money, although those have to fall within the “broad parameters” of the relief packages, according to federal guidance.

Rules for ESSER funding are spelled out in the three relief packages. Neither state legislatures nor state education departments can limit how school districts use their ESSER funds , according to the U.S. Department of Education’s guidance. The department did say states can request information from districts about how they plan to use the relief money. And in general, nothing prevents state and local officials from discussing ideas about the best ways to use the COVID-19 aid.

I know the federal government passed COVID-19 relief for schools months ago. Does my school district currently have access to those dollars?

By now, local school districts should have gotten access to funding from the first two two relief packages, the CARES Act and the CRRSA.

The situation with the American Rescue Plan is a little more complicated. Earlier this year, the Education Department awarded roughly two-thirds of the $122 billion in funding for state and local education agencies. Based on the requirement that states provide subgrants of that money to local school systems within 60 days, districts in general should have that money by now.

In order to gain access to the rest of the money, states must submit plans for how they and local school districts will use ESSER funding to safely reopen schools, address the pandemic’s negative academic effects on students, and focus on other priorities. As of early September, the Education Department had approved 33 state ESSER plans.

When does my district have to decide how to spend its funds? Can it change course after making plans?

Districts are not required to follow the exact plan they submit to the state this summer or fall. In fact, some districts have already begun changing their plans as COVID surges from the Delta variant of the virus upend what at one point appeared to be a return to normal in-person school.

I’ve heard that districts have to spend 20 percent of stimulus funds on helping students recover from learning loss. What does that mean?

First, it’s worth noting that that requirement only kicks in with ESSER III funds. Districts are required to spend at least 20 percent of their American Rescue Plan allocation on addressing the impact of lost instructional time. The U.S. Department of Education is giving districts a long leash on how they define those efforts. New guidance the department published in August mentions strategies as varied as types of services for students with disabilities, tutoring, social-emotional learning, home visits, communication with families, and assessments.

Is there anything my district isn’t allowed to spend its federal money on?

In general, the legal language governing ESSER and federal guidance give districts a lot of leeway when it comes to how the money can be used. Districts may use it for addressing the academic impacts of lost instructional time, education technology, mental health services, after-school programs, facilities upgrades to improve air quality in schools and prevent the transmission of COVID-19, and other uses for funds allowed in other federal laws, such as the Every Student Succeeds Act.

However, the Education Department is discouraging districts from using the funding on new construction due to the nature of those projects. “Remodeling, renovation, and new construction are often time-consuming, which may not be workable under the shorter timelines associated with ESSER and GEER funds,” the department’s guidance states. The guidance does not say using ESSER money on such projects is illegal, however.

What happens when the money runs out?

That’s the question on the minds of most school administrators and district leaders around the country. In some cases, improvements or additions to school districts that take place as a result of the federal funding might persist, if the community likes them and if the district can figure out an alternative funding source in a few years. In other cases, districts are already telling new hires that they will eventually lose funding to keep them employed.

How will the government hold schools accountable for how they spend their money?

The funding laws require state education departments to review how school districts spend ESSER funds. States can take a variety of approaches to that review process, but common ones include reviewing applications and budgets before they’re official; vetting expenses before reimbursing districts for the costs they’ve incurred; or implementing a more formal process of financial monitoring. Districts will also be required to report various spending figures to the Education Department.

School districts that spend more than $750,000 in federal funds during a given year will have their spending audited. The Education Department’s office of the inspector general will likely audit ESSER spending at some point, and the Government Accountability Office (GAO), an arm of Congress, may do the same, both with the goal of informing policymakers and the public.

Unlike some recent federal education funding initiatives, the pandemic emergency funding laws do not require schools to report particular outcomes of spending as a condition for receiving funds.

What are the odds that the federal government approves another COVID relief package for schools?

The three prior coronavirus aid deals for schools have brought roughly $190 billion in dedicated funding for state education departments and local school systems. In addition, the American Rescue Plan, the third COVID-19 relief package that included money for K-12, provided $350 billion in funding for state and local governments that could also end up benefiting public schools. Since Biden signed the American Rescue Plan in March, there hasn’t been much talk about passing another package for schools structured along the same lines. Amid some concerns about inflation, policymakers might not be interested in another relief package unless the economy significantly weakens.

However, that’s not the whole story. Lobbyists are pushing hard for Congress to include funding for school infrastructure in a massive $3.5 trillion budget deal from Democrats. If it is enacted, this deal, over its 10-year lifespan, could help officials address longstanding concerns about issues like air quality that many have linked with the spread of the virus. It’s also possible the deal could broaden access to free school meals and provide more money to support K-12 school leaders and teacher-residency programs. More broadly, that deal could support things like universal prekindergarten for 3- and 4-year olds, an extension of a recently expanded child tax credit, and more. Those wouldn’t be direct new funding streams for schools, but supporters say that among other things they could provide significant downstream benefits to K-12 schools.

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