Education Funding

Federal Spending Plan Aims to Ease ‘Sequester’ Pain

By Alyson Klein — January 17, 2014 6 min read
Senate Majority Leader Harry Reid of Nev. speaks during a news conference on Capitol Hill in Washington, on Tuesday, Jan. 14, following a Democratic policy lunch. A massive $1.1 trillion spending bill, aimed at funding the government through October and putting to rest the bitter budget battles of last year, is getting generally positive reviews from House Republicans who are eager to avoid another shutdown crisis with elections looming.

The massive spending bill passed by Congress and sent to President Barack Obama this week aims to largely restore federal aid for most schools after the biggest cuts to K-12 funding in history, while including a more than $1 billion down payment on the Obama administration’s proposal to ramp up existing early-childhood programs.

But two initiatives high on the administration’s wish list—a Race to the Top for higher education and $750 million in new grants to help states improve their preschool programs—aren’t slated to receive funding in the fiscal year ending Sept. 30. And the bill would flat-fund, or even cut, the marquee competitive-grant programs that form the bedrock of the administration’s education-redesign strategy.

What’s more, the high-priority School Improvement Grant turnaround program would undergo a major makeover, resulting in more flexibility for states and districts to devise their own strategies for fixing the lowest-performing schools—an idea that’s met with stiff resistance in the past from U.S. Secretary of Education Arne Duncan.

The $1.1 trillion spending bill for fiscal 2014 is the first since Congress temporarily put the brakes on sequestration, the 5 percent, across-the-board cuts to federal programs that went into effect last March. It would largely affect districts beginning in the fall, with the start of the 2014-15 school year. President Barack Obama is expected to sign the legislation.

Down the Road

The issue of sequestration hasn’t gone away entirely. Lawmakers are rolling back roughly 86 percent of the cuts for the next two years, but will have to come to a broader budget agreement to permanently scale back the reductions.

The big formula programs that nearly every district depends on—Title I grants for districts and special education state grants—would receive slight increases under the spending bill. Both programs were pinched by sequestration, resulting in larger class sizes, delayed professional development, and other cutbacks at schools around the country.

Funding Picture

In its fiscal year 2014 spending bill, Congress attempted to make up for losses to key education programs because of the across-the-board cuts known as sequestration, while putting less emphasis on the Obama administration’s competitive-grant priorities. Sequestration kicked in during the 2012-13 school year (fiscal year 2012).

18Budget C1s

SOURCE: U.S. Congress, Committee for Education Funding

Neither program would make it back up to the funding level it had before sequestration hit in March 2013, but both would come close. Title I grants, which help districts educate poor children, would be financed at $14.4 billion, a $624 million increase over sequestration levels, but not quite to their previous high of $14.5 billion in fiscal 2012. And special education state grants would get roughly $11.5 billion, a $497 million increase over sequestration levels, but not as high as the nearly $11.6 billion the program got before the decreases went into effect.

Other formula programs—including the grants to help districts create after-school and summer programs or extend learning time, grants to help educate English-language learners, and money for career and technical education—also would see their funding rise close to levels before sequestration.

But competitive grants wouldn’t fare nearly as well. The administration’s Promise Neighborhoods initiative, which helps communities pair wraparound services with education, would be frozen at sequestration levels of $56.7 million. Investing in Innovation, the grant competition that helps nonprofit organizations and school districts scale up promising practices, would get $141.6 million, and the School Improvement Grant program would receive $505.8 million.

Funding Priorities

Overall, the National Education Association was pleased with the budget compromise.

“I think this appropriations bill is trying to address the harm that has come to students most in need under the sequester,” said Mary Kusler, the government-relations director for the 3 million-member NEA.

But Mark Benigni, the superintendent of the high-poverty, 9,000-student Meriden district in central Connecticut, said he would have liked Congress to direct even more funding to formula programs, given that school systems are being asked to serve more students and roll out new standards and tests. Mr. Benigni’s district lost $300,000 in a $100 million budget because of sequestration. The federal reductions were a factor in its decision to eliminate 10 staff positions, including teachers and academic coaches.

“Clearly, getting some of these dollars back will be beneficial and helpful,” he said. But he wishes that programs would go back to levels before sequestration or get increases, particularly since Congress found funding for competitive grants. It’s hard “for them to take any resources from us at a time when we’re being asked to do more and more,” he said.

The administration’s signature education overhaul initiative—Race to the Top—would continue under the proposal, although not in the way the White House initially envisioned in its budget proposal, unveiled last spring. The administration asked Congress for $1 billion for a new round of the competition aimed at prodding states to improve higher education outcomes, such as graduation rates, while holding down tuition. Instead, the spending measure would provide just $250 million for another iteration of the Race to the Top early-learning competition, which so far has awarded grants to 20 states.

However, the administration would get a higher education consolation prize of sorts: $75 million in new money for a “First in the World” fund aimed at helping colleges test out new strategies for improving student outcomes.

Early-Education Boost

Formula-aid programs tend to have “more friends in Congress,” said Clare McCann, a policy analyst at the New America Foundation’s Federal Education Budget Project. But, given the focus on early-childhood education, “it’s hard to say the president didn’t do well in this budget.”

The Head Start program, which suffered big losses under sequestration, losing 57,000 slots, would walk away a big winner. The program, administered under the U.S. Department of Health and Human Services, would get a $1 billion boost, bringing it up to nearly $8.6 billion. Much of the increase— $500 million—would be aimed at Early Head Start, which serves children from birth through age 3. The money would go to set up Early Head Start-Child Care partnerships, allowing Head Start programs to partner with local providers and centers to improve program quality.

Another big winner on the early-childhood front: the Child Care and Development Block Grants, which help states offer child-care assistance to needy families. The bill includes nearly $2.4 billion for the program, an increase of $154 million over last year’s levels.

But the White House didn’t win its $750 million request for development grants to help states get their early-childhood programs ready for the expansion.

School Improvement Changes

In another major development, the measure includes language that amounts to a huge policy change for the controversial SIG school turnaround program, one of the Obama administration’s most prominent initiatives.

Schools would no longer have to choose one of the administration’s four turnaround models, which call for dramatic actions such as extending the school day, putting in place merit-pay programs for educators, and replacing school leadership. Instead, the measure would offer schools and states two new choices, including the chance to try out any school improvement strategy that’s been proposed by the state and gotten a green light from the U.S. secretary of education.

On top of that, the measure would add a fifth model, known as “whole school reform,” which would allow schools to partner with an outside organization that has a proven track record in turnarounds.

The new SIG language didn’t come out of thin air—it closely mirrors the SIG provisions in a bill to renew the Elementary and Secondary Education Act that was approved by the Senate education committee last June. But it’s a blow to the Obama administration, which had stood stubbornly behind its four models, even as student-outcome data from the SIG program showed it had a mixed track record.

In another important change, schools would be able to renew their SIG grants for up to five years, instead of the current three. That would give them more time to implement turnaround plans.

A version of this article appeared in the January 22, 2014 edition of Education Week as Spending Plan Aims to Relieve Some K-12 ‘Sequester’ Pain


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