Education Budget

Today the Obama administration released detailed proposals for the President's fiscal year 2010 federal budget. (Detailed information from the Department of Education and Department of Health and Human Services--Administration for Children and Families available at these links.) These proposals include significant new investments in early education, including the creation of several new initiatives designed to support learning and development in children’s first several years of life.

President Barack Obama submitted his first budget request to Congress on Thursday, May 7, 2009. This request follows the initial summary budget request he submitted in February that included only proposed funding levels for federal programs and agencies in aggregate. The detailed budget request includes proposed funding levels for federal programs and agencies in aggregate for the upcoming five to ten fiscal years, and specific fiscal year 2010 funding levels for programs subject to appropriations. The president's 2010 budget request marks the first time the Obama administration has submitted funding recommendations for every federal education program and a comprehensive list of new education policy initiatives.

In an effort to heighten the quality of debate on federal education policy, the New America Foundation's Federal Education Budget Project has reviewed the president's proposals and generated a list of key questions policymakers, the media, stakeholder groups, and the public should ask about the proposals.

Early Education

In 2006, President Bush signed two new higher education grant programs into law: the Academic Competitiveness (ACG) and Science and Mathematics Access to Retain Talent (SMART) grant programs. Both have received mixed reviews from the higher education community, and recent reports from the Department of Education have shed new light on the programs' fledgling operations. This information will certainly affect Congress and the president's decision to extend the programs which are set to expire after fiscal year 2010. The Obama Administration's full fiscal year 2010 budget, expected to be released as early as this week, might give the first clue as to what the new Administration plans to propose for the grant programs. In the meantime, let's take a brief look at what we know about the programs.

 At Ed Money Watch, we discuss and analyze major issues affecting education funding. In our Friday News Roundup, we try to highlight interesting stories that might otherwise get overlooked. These stories emphasize how federal and state policy changes can affect local schools and districts.

Oregon Bill Would Ease School Requirements

Connecticut Legislators Debate Best Use of Stimulus Money

New Jersey Supreme Court Hears Arguments on School Funding Formula Reforms

Stimulus Transparency Off to a Slow Start

It appears that House and Senate Democrats have agreed to include "budget reconciliation instructions" aimed at reforming federal student loan programs in the fiscal year 2010 budget resolution. The House and Senate each adopted their own versions of the 2010 budget resolution several weeks ago and will bring a final compromise version up for a vote this week. The most important piece of the budget resolution for education programs is the reconciliation instruction. What is budget reconciliation and why is it important?

Reconciliation is one part of the larger congressional budget resolution, an agreement between House and Senate majorities on spending and revenue levels for the five or ten upcoming fiscal years. (The 2010 budget resolution covers 2010 through 2014.) The budget resolution is not legislation. It serves only as a set of self-imposed guidelines that Congress uses to shape legislation considered later in the year. Importantly, it cannot be filibustered in the Senate, requiring only a simple majority vote to pass.

Georgia Math and Science Teachers Get a Salary Bump

California Proposition Could Bring $9.3 billion to California Schools

In a Struggling Economy, Student Loan Default Rates Soar

The Department of Education (ED) released a second round of guidance documents for the major programs funded in the American Recovery and Reinvestment Act (ARRA) on April 10th. Each document specifies how funds for each program will be distributed, how funds will be disbursed, and how states and local education agencies (LEAs) will be able to use them.  Previously, we discussed the guidance for the State Fiscal Stabilization Fund, Title I Part A, and IDEA Part B.

Today we will take you through the guidance document for Impact Aid funds provided in the stimulus. ARRA provided $39.6 million for Impact Aid formula grants and $59.4 million in competitive discretionary grants, $100 million total.

Since the passage of the stimulus bill in mid February, states and school districts have been curious about the details for the new Qualified School Construction Bond program. To date, the Department of Education hasn't provided many details on the program, perhaps because it is a tax program, not a spending program. Turns out, the Internal Revenue Service (IRS) released guidance and allocations for the program to states and LEAs in mid April.  We review these allocations in the post below[1].

The Qualified School Construction Bond program provides $11 billion face value in tax-free bonds in both fiscal years 2009 and 2010 to help fund school construction, rehabilitation, repair, and land acquisition. It is estimated that the federally-funded bonds will save schools nearly $10 billion in taxes over the next 10 years. Effectively, the federal government is providing interest-free loans to schools and districts to finance school construction efforts. While the schools and districts must repay the loan face value, they do not have to pay interest on it. Stimulus legislation stipulates that 40 percent of the bond face value be distributed to the 100 local education agencies (LEAs) with the most students living in poverty and the remaining 60 percent to other LEAs based on the distribution of Title I Part A Basic Education Grants.

At Ed Money Watch, we discuss and analyze major issues affecting education funding. In our Friday News Roundup, we try to highlight interesting stories that might otherwise get overlooked. These stories emphasize how federal and state policy changes can affect local schools and districts.

Schools Chief Seeks Additional Title I Funds

Struggling to Make Ends Meet, Schools Move Away from "Need Blind" Admissions

Federal Money May Help Save Struggling State Pre-K Programs

California Officials Promise to Spend Stimulus Funds as Directed

The Department of Education (ED) recently released stimulus guidance intended to clear up some of the questions states and LEAs have regarding fund distribution, allocation, and accounting.  Unfortunately, some uncertainty remains around several issues including how funds will be distributed to charter schools that are also local education agencies (LEAs).  Depending on state law, some charter schools function as their own LEAs for federal funding purposes while others are part of an existing LEA.  Although the guidance clearly states that charter LEAs are entitled to their fair share of State Fiscal Stabilization and Title I funds, the Department has left it up to state agencies to adjust their allocations to account for those LEAs.

In distributing the Stabilization Funds to states, ED provided each state with a share of the total $48.6 billion based on their total population aged 5-24 as well as their share of overall population. In the case of K-12 monies, states are expected to distribute their funds directly to LEAs (both traditional and charter) using the state's primary education funding formula.