Education Funding

Showdown Brews as Congress Turns Focus to K-12 Spending

By Alyson Klein — January 02, 2014 5 min read
House Budget Committee Chairman Paul Ryan, R-Wis., left, and Senate Budget Committee Chairwoman Patty Murray, D-Wash., announce an agreement last month between Republican and Democratic negotiators on a government spending plan.

Big questions loom about just how much money Congress will steer to individual programs—including the Obama administration’s marquee competitive-grant initiatives—with lawmakers on House and Senate appropriations committees facing a Jan. 15 deadline to fill in details on the current year’s spending plan or face another government shutdown.

School districts that have been chafing under across-the-board federal cuts known as sequestration for nearly a year got a two-year reprieve under the agreement approved last month that effectively scales back the cuts to education by 87 percent over that period, according to an analysis by the Committee for Education Funding, a lobbying coalition in Washington.

But the deal, which sets discretionary spending levels at roughly $1.02 trillion for the overall budget this year and will keep them relatively flat for the next two years, leaves little room for big new initiatives, such as President Barack Obama’s high-profile proposal to expand preschool to more 4-year-olds.

Tough Choices

The spending-bill negotiations are likely to set up another showdown of sorts. Lawmakers will have to decide whether to steer the entire expected increase for education into funding for big formula programs, favored by advocates—such as Title I grants to districts, which help educate disadvantaged students, and special education—or direct some money to the administration’s prized competitive-grant programs, including Race to the Top, Investing in Innovation, and the School Improvement Grant program.

Next Steps

After more than a year of fiscal turmoil, the U.S. Congress has approved a budget plan that temporarily rolls back part of the sequester cuts, which trimmed about 5 percent of federal K-12 spending during the 2013-14 school year. So what happens now?

  • Lawmakers will write appropriations bills for fiscal year 2014, which largely covers the 2014-15 school year. The bills, which must be passed by Jan. 15, will determine whether lawmakers boost funding for the formula programs that go out to every district, such as Title I grants for disadvantaged students.
  • The agreement sets relatively flat spending levels for the next federal fiscal year, meaning that new money for big initiatives, such as the president’s preschool proposal, may be in short supply.
  • After about two years, the sequester cuts could kick in again unless Congress comes to some new, broader agreement. The cuts are slated to be in place for a decade.

SOURCE: U.S. Congress, Education Week

“We’re still operating in tight budget years, we’re not out of the woods,” Clare McCann, a policy analyst at the New America Foundation’s Federal Education Budget Project, said. “It’s very contentious to find places to cut, but it’s still going to be contentious to find places to add money.”

The broad spending deal, which was negotiated by Rep. Paul Ryan, R-Wis., and U.S. Sen. Patty Murray, D-Wash., sailed through a Congress that has been paralyzed by a series of fiscal showdowns for more than two years. It was approved by the House of Representatives on Dec. 12, by a vote of 332-94, and the Senate on Dec. 18, by a vote of 64-36.

The plan means that school districts, which saw their funding cut roughly 5 percent under sequestration, mostly during the 2013-14 school year, won’t have to cope with yet another round of federal reductions.

Nick of Time

Sequestration has had an uneven impact on education. Some schools have barely noticed the cuts, thanks in part to brightening state fiscal pictures. But others, including districts that get federal Impact Aid, which helps make up for tax revenue lost because of a federal presence, were pummeled. Head Start, an early-childhood education program for low-income children administered under the U.S. Department of Health and Human Services, was hit particularly hard, losing 57,000 slots after sequestration went into effect in March 2012. Now those programs could see an increase in funding.

Districts that have felt the squeeze say the fiscal breathing room can’t come soon enough.

“At least we’re hopeful now, and we haven’t been hopeful for a while,” said David Pennington, the superintendent of the 5,400-student Ponca City district in Oklahoma. It has lost more than $150,000 to sequestration, on a budget of nearly $34 million. He said the district—whose student population is roughly 20 percent Native American—was largely able to avoid staff layoffs in 2013. But, he said, “we weren’t going to be able to do that going forward.”

The two-year spending agreement doesn’t mean a permanent end to the prospect of cuts. The reductions are slated to be in place for a decade unless lawmakers are able to come up with a longer-term agreement on the right mix of taxes and spending.

To cover the cost of temporarily halting sequestration, the agreement includes a host of cuts to federal programs, including some changes to the student-lending program. For instance, nonprofit organizations that service student loans no longer would be paid through mandatory, or essentially, automatic federal funding. Instead, they’d get their payments from the discretionary side of the ledger, where payments are determined every year by lawmakers.

Early Wish List

Education advocates wasted no time in letting lawmakers know where they want most of the newly restored K-12 money to go: into big formula programs dispensed to nearly every district to help educate poor children and students in special education, improve teacher quality, and bolster career and technical education.

“Given the limited nature of federal funding, we caution against diluting the potential of federal investment by focusing on nonformula funding for a narrow set of recipients, or funding new initiatives at the expense of Title I and [special education],” wrote five education advocacy groups in a letter sent Dec. 18 to every member of Congress. The groups include: AASA, the School Superintendents Association; the American Federation of Teachers; the Council of the Great City Schools; the National Education Association; and the National School Boards Association.

The American Association of Educational Service Agencies, the National Rural Education Association, and the National Rural Education Advocacy Coalition, along with the AASA, sent a letter to lawmakers the same day making a similar point.

“We are troubled with a continued effort to fund competitive-grant programs that create a federal education structure of winners and losers,” they wrote. “Especially in rural communities, the lack of access to these critical funds exacerbates—rather than addresses—resource and achievement gaps.”

Ms. McCann of the New America Foundation said that some lawmakers may not have expected Race to the Top and Investing in Innovation—programs created under the American Recovery and Reinvestment Act of 2009—to remain in place this long. She said Congress has largely been funding the government using stop-gap measures that continue financing all programs at the previous year’s levels.

“I don’t think people expected Race to the Top and Investing in Innovation to stick around the way they did,” Ms. McCann said. “I think they’re going to try to shift focus back to the more baseline budget formula programs” such as Title I and special education.

A version of this article appeared in the January 08, 2014 edition of Education Week as Congressional Appropriators Turn to K-12 Spending Details

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