Special Report
Education Funding

Uncertain Costs

January 04, 2005 5 min read

The debate over how much federal aid is enough to pay for the No Child Left Behind Act has raged since well before President Bush signed the legislation in January 2002.

While politics is surely part of the mix, there are other complex issues to wade through.

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The Bottom Line

Most telling, perhaps, is the sense that no one really knows how much it will cost to effectively implement the bipartisan law nationwide. And there doesn’t appear to be a consensus on where the federal government’s responsibility ends and that of states and school districts begins.

For instance, there’s a big difference between determining the costs of technical compliance with testing and accountability measures and calculating what it would cost to achieve the act’s ultimate goal of ensuring all students are proficient in reading and mathematics by the end of the 2013-14 school year.

A handful of studies have taken a crack at settling the cost issues, often reaching dramatically different conclusions, largely because of the varying assumptions used by their authors.

One recent study, conducted for Hawaii, found that the state would face additional costs of about $30 million for the current school year, with those gradually climbing to nearly $48 million by the 2007-08 school year.

An Ohio study—which has been accused of both overstating and understating the costs of the federal law—came up with a figure of some $1.5 billion in extra annual expenses for Ohio.

Still another study, by the Washington-based research firm AccountabilityWorks, argues that current spending would be more than enough if schools did a better job using their money.

The Bush administration has sought to place the funding question in historical context, noting the dramatic growth in federal aid recently.

From fiscal 2001 to 2004, spending for the array of federal K-12 programs included under the law, a reauthorization of the Elementary and Secondary Education Act, grew by 40 percent, according to figures provided by the U.S. Department of Education.

“[T]he chorus that there is inadequate funding under NCLB just doesn’t wash,” Secretary of Education Rod Paige, who planned to resign from his post early this year, wrote in a 2004 memo to reporters. “America’s schools are experiencing record levels of federal funding.”

But that record spending has exceeded what President Bush initially had in mind. In the three years following his election in 2000, Congress exceeded his budget request for the Education Department. But even that growth is slowing. The fiscal 2005 budget, passed in November, increases the federal agency’s discretionary budget by less than $1 billion, falling below Mr. Bush’s request for the first time.

Failing to Deliver?

Leading congressional Democrats typically point to a different set of figures when debating education spending: They like to cite the figures that establish how much money is authorized to be spent under the No Child Left Behind law.

The Democrats maintain that President Bush broke his “promise” to meet those levels.

While Title I appropriations certainly have grown, they have slipped below the more aggressive raises suggested in the law.

In a break with the usual process, the No Child Left Behind law—which governs the Title I program for disadvantaged students and other key precollegiate initiatives—spells out yearly authorization levels through fiscal 2007. The amount for Title I climbs steadily. And while Title I appropriations certainly have grown, they have slipped below the more aggressive raises suggested in the law. For example, the final Title I budget for fiscal 2004 fell roughly $6 billion shy of the $18.5 billion authorization level.

Republicans say Congress routinely authorizes more for federal programs than it appropriates, and argue that those numbers reflect ceilings on spending rather than intended levels.

Joel Packer, a senior lobbyist for the National Education Association, sees it differently. “These [spending figures] were not just kind of pulled out of thin air,” he says. “We think they’re pretty meaningful.”

Judgment Varies

The studies on what the law will cost have produced widely varying results.

“It depends on whose judgment is used,” says John G. Augenblick, the president of Augenblick, Palaich, and Associates, a Denver-based consulting firm that has examined the issue.

The study his firm conducted for Hawaii, issued last summer, focused on the compliance plan that the state submitted to the federal government. “We’re driving this by the state’s agreed-upon plan,” Augenblick says. “Some of the other work that’s been done has been driven by people’s own ideas of what should be done.”

The study commissioned by Ohio’s state education agency found that the law would add more than twice the amount in new costs than the state receives under the law.

The Ohio study made the assumption that—because the law calls for ensuring all students are academically proficient by 2014—the federal government should pay the costs of moving from 75 percent proficiency, the state’s current goal, to 100 percent.

The 2004 study breaks down costs into two areas. The first focuses on administrative expenses and the costs of meeting the law’s stepped-up demands on the qualifications for teachers and paraprofessionals. The second is the “intervention” costs for bringing all students to proficiency. Those costs account for more than 90 percent of the $1.5 billion price tag.

No study is likely to silence the debate over how much federal money is enough.

Congress’ investigative arm, now called the Government Accountability Office, issued a study in 2003 on testing costs under the federal law. The GAO offered three different estimates for states over the six years of the law’s authorization: $1.9 billion, $3.9 billion, and $5.3 billion. The cheapest assumed all test questions would be multiple choice and machine-scored. The middle one assumed a mix of multiple-choice and open-ended questions. The priciest involved some written responses, to be hand-scored.

Actual spending for testing under the law is likely to be around $2.3 billion over that timeframe, according to the report.

Leading Republicans in Congress, such as Rep. John A. Boehner of Ohio, the chairman of the House Education and the Workforce Committee, latched on to the GAO study as showing that “Congress is providing more than enough money for states to meet the annual testing requirements in the No Child Left Behind Act.”

Others have likened that interpretation to advocating a fill-in-the-bubble approach that loses the kind of sophistication desired in tests.

No study is likely to silence the debate over how much federal money is enough. Even the increases contemplated by congressional Democrats would make only a modest difference, considering that the nation spends nearly $500 billion annually on precollegiate education, only a sliver of which comes from federal sources.

“Even with all the recent increases in federal appropriations, it’s meant that the federal government has gone from paying for 7 percent of the cost of education to 8 percent,” says Jack Jennings, the director of the Center on Education Policy, a Washington think tank, and a former Democratic aide on Capitol Hill. “It may seem big in Washington, but it’s not very big in Sheboygan.”

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