Ed Money Watch

Friday News Roundup: Week of November 2-6

Emilie Deans — Fri, 06 Nov 2009 17:43:00 -0500

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.

As Enrollment Grows in Utah, Budget Shrinks

Arizona Budget Shortfall Forces Cuts

Pennsylvania Universities Anxiously Await Decision on Gambling Taxes

Nebraska Legislators Propose Cuts to School Aid

Kentucky Higher Education Council to Vote on Budget Plan

As Enrollment Grows in Utah, Budget Shrinks
Utah's State Office of Education this week released data showing that enrollment in the state's public K-12 schools increased by 12,260 students since last fall. This growth came at the same time the state's education budget decreased by 5.2 percent from the previous year, thanks to the economic downturn. These numbers mean that schools will have to cut services for students, and per pupil expenditures will go down. And the forecast for next year doesn't look much better - the State Office of Education predicts a similar increase in K-12 enrollment with no increase to the budget. The state may need to dip into its rainy day fund just to maintain spending levels from the current fiscal year. More here...

Arizona Budget Shortfall Forces Cuts
Arizona Governor Jan Brewer is planning a mid-November special legislative session to address the state's $2 billion budget shortfall. Governor Brewer has been working with House and Senate leaders to come up with a package of spending cuts to make up for a $500 million revenue shortfall. Most of the cuts will reflect those proposed in a package previously vetoed by Governor Brewer, including much of the annual inflation adjustment for K-12 public schools and funding for purchases of computers, textbooks, and other equipment. Additional cuts will be made during a second special legislative session and during the 2010 regular session, which begins in January. More here...

Pennsylvania Universities Anxiously Await Decision on Gambling Taxes
Lawmakers in Pennsylvania have reached a stalemate over details of a bill to legalize and tax gambling table games, like poker, at the state's existing slot-machine casinos. Last month's budget agreement between Governor Ed Rendell and state legislators assumed passage of the bill to raise $200 million in tax revenues. This revenue would contribute to university funding, without which the universities could have to raise tuition for the 2010 spring semester. The universities are pressing the legislature to ensure that they will receive the full amount they've been promised as tuition bills will go out on November 13^th. More here...

Nebraska Legislators Propose School Aid Cut
In a special budget cutting session of the Nebraska state legislature, the State Senate Education Committee proposed cuts totaling about $47 million to schools for fiscal year 2011. About half of the savings would come from limiting to 1 percent the annual funding increase for most school districts. An additional $24 million in cuts would be made by reducing state aid to school districts based on the number of teachers with graduate degrees. The Education Committee's proposal—one of seven introduced on the first day of the special budget-cutting session—came as part of Governor Dave Heineman's plan to cut about $336 million from the state's current two-year budget plan. More here...

Kentucky Higher Education Council to Vote on Budget Plan
The Kentucky Council on Postsecondary Education, the state's coordinating agency for higher education, was scheduled to vote this week on a budget recommendation calling for a $2.1 billion increase in state spending on higher education in the 2011-2012 two-year budget. The increase includes $70 million in each fiscal year to replace federal economic stimulus funding included in the current fiscal year 2010 budget. It also includes a request for a $50 million fund for higher education institutions to promote student retention and graduation rates. This request comes as state officials brace for a difficult budget session - revenue to the state's General Fund is expected to fall about $1 billion short of the $9 billion required for the current fiscal year. Governor Steve Beshear told higher education officials that the upcoming budget will be difficult, but that access to higher education for all Kentuckians is a priority. More here...

Comparing Department of Education and Recipient Reported Stimulus Data

Jennifer Cohen — Thu, 05 Nov 2009 20:40:00 -0500

When Congress passed the American Recovery and Reinvestment Act (ARRA), they included extensive data reporting requirements so that the public could closely track expenditures. Now that the recipient reported data on expenditures is publically available, tracking education funds should be easy. But as we discussed earlier this week, data reported by school districts and institutions of higher education is lacking in comprehensive information and is difficult to decipher. Unfortunately, state-level recipient reported data does not match previously available Department of Education (ED) reported data for many states, further undermining the value of the data. If the point of the data collection process was to provide accessible data on the progress of the stimulus, this data falls short of that goal.

ARRA recipients reported the total amount of federal stimulus funds they had received as of September 30^th, 2009 for all stimulus programs (except Pell Grants). This data can be compared to data ED reported on the amount of funds disbursed for the same programs. To do this comparison, we aggregated the recipient reported data on total ARRA funds received by state and compared it to ED's reports on funds it disbursed after subtracting any disbursements related to Pell Grants. We found a fair number of discrepancies between the recipient and agency reported data.

Of the 50 states, Puerto Rico, and the District of Columbia, only 27 states or territories reported grant amounts received that were anywhere near the amount that ED reported it had disbursed. The majority of these states reported slightly higher amounts of funds received than the ED agency reported data.

Of the 25 states or territories that reported data that differed from data that ED reported by more than 5 percent, 20 reported receiving higher amounts. For example, the District of Columbia reported that it had received $3.6 million in federal stimulus grants as of September 30^th. However, the ED reported data suggests that only $271,095 had been disbursed to DC as of that date, a discrepancy of 92.5 percent. Similarly, there is a discrepancy of 87.6 percent and 67.6 percent between Alaska's and Delaware's recipient and ED reported data, respectively.

Five states reported lower amounts of federal stimulus funds received than the ED reported data suggests. For example, Kansas reported that it received $42.2 million less than the ED agency reported $203.2 million, a 25.4 percent difference. North Carolina also reported that it had received $391.2 million, $61.9 million less than ED reported it had disbursed.

Without further information on how the states reported the amount they had received, it is impossible to understand why the recipient reported data differs from the agency reported data so greatly. However, these discrepancies call into question the value and validity of the recipient reported data in general. It seems that the states were either ill equipped to collect this data in such a short time span or the school districts and institutions or higher education are doing a poor job of tracking the funds as they come in. Either way, these data suggest that the current recipient reported data system will require significant refinement to become completely useful.

Complete data for all 50 states, Puerto Rico and DC is available here.

Recipient Reported Education Stimulus Data a Challenge to Decipher

Jennifer Cohen — Tue, 03 Nov 2009 21:41:00 -0500

Last Friday, the first round of recipient reported Recovery Act grant and loan data was made available on the Recovery.gov website. Much like the previously released federal contract data, this wave of data lacks the comprehensive information needed to truly determine how the funds are being spent and from what source. The data are both difficult to decipher and include several instances of human error.

While working with the data we discovered several issues that make the data difficult to understand. For example, less than half of all education-related data are tagged with the funding agency name "Department of Education." Other possible funding agencies include "Federal Student Aid," "Impact Aid Programs," "Office of Elementary and Secondary Education," "Office of Higher Education Programs," "Office of Special Education and Rehabilitative Services," "Office of Postsecondary Education," and "Office of Vocational and Adult Education."

Additionally, data that should be education-related are tagged with TAS codes that are not for education programs. As we've discussed before, the Treasury Accounting Symbol (TAS) is used to identify funding sources in each record. Of the 15 TAS codes in the education-related data, only nine of those codes pertain to education programs. The remaining six appear to be the result of erroneously entered codes. These erroneous codes account for 17 education-related records.

While helpful to a certain extent, the TAS code does not always identify specific programs. For example, the TAS code for the State Fiscal Stabilization Fund does not distinguish between Education Stabilization and Government Services Funds. Similarly, the School Improvement TAS code does not distinguish between McKinney Vento Homeless Education and Education Technology grant funds. This further information is included in the qualitative variables in the data which are impossible to categorize systematically, making it difficult to determine exactly what funding sources each record is referring to.

Significant information is missing in the sub recipient data as well (in this case, school districts or institutions of higher education are considered sub recipients). None of the sub recipient data contain information on funding agency or TAS codes, making it impossible to determine the funding sources or programs referenced in any of the sub recipient data. (We hope to receive this data with all the proper information in the near future.)

However, using the prime recipient data, we were able to extrapolate data on jobs created or saved and funds awarded, received, and expended by TAS code and by state. For example, the data we have show that a total of $58.8 billion in education related stimulus funds have been awarded. Of that amount, $14.2 billion has been received and $14.0 billion has been expended. Nearly 398,000 jobs were created or saved by the stimulus.

The amount of received funds that have been expended varies widely by state, as does the number of jobs saved. For example, Alaska has expended only 2.2 percent of its received funds, while Connecticut has expended 188.0 percent of its received funds. It is possible for a state to expend funds before they have received them because some states receive federal funds on a reimbursement basis after the expenditures have been made. It is very likely that Connecticut, and the 16 other states that have expended more than 100 percent of their received funds are on reimbursement plans for the education funds. Wyoming reported that it saved 15 jobs through the education stimulus funds, while California claims to have saved nearly 81,000.

The percent of funds expended also varies widely by program. For example, the data suggests that 108.7 percent of the received School Improvement funds have been expended while only 38.2 percent of the received Impact Aid funds have been expended. More than 100 percent of received Higher Education Program, Special Education, Title I, and School Improvement funds have been expended. The data also suggest that State Fiscal Stabilization Funds were used to save more than 316,000 jobs and special education funds were used to save more than 35,500.

It is clear that stimulus fund recipient reported data, while valuable for understanding how funds effect education and the economy, are being collected in a flawed manner. The data lack comprehensive information on funding sources, and problems with sub recipient data make it impossible to determine what is happening with the funds in school districts and institutions of higher education. Further, human error in data reporting is skewing findings. Hopefully, the Department of Education will work out these kinks as reporting continues. If not, state and local efforts to report this information may be fruitless in the end.

Complete data on recipient reported data by state and by TAS code are available here and here.

Friday News Roundup: Week of October 26-30

Ed Policy — Fri, 30 Oct 2009 19:31:00 -0400

Montana Education Officials Doubtful About Race to the Top Chances

Colorado Governor Unveils Plan to Close Budget Shortfalls

School Districts in Oklahoma Face Steep Cuts as Funding Streams Dry Up

New York Governor Proposes New Cuts as Deficit Climbs

Massachusetts Governor Makes New Cuts, Spares Education

Montana Education Officials Doubtful About Race to the Top Chances
Education officials in Montana are critical of the priorities laid out by the Obama administration for the upcoming Race to the Top (RttT) competitive grants, a new program created by the American Recovery and Reinvestment Act. Montana's Superintendent of Schools, Denise Juneau, called RttT's approach a one-size-fits-all prescription for states. While she agrees with the administration's priorities of hiring quality teachers, turning around struggling schools, and using data to inform decisions, Juneau claims that fulfilling the requirements of RttT would violate the state's constitution. Instead of making changes to state law to better accommodate charter schools and alter teacher and principal evaluations to align with RttT's priorities, Juneau and other state education officials have proposed that U.S. Education Secretary Arne Duncan change the rules of RttT. They claim that the current priorities, especially the charter school elements, don't make sense in rural states where school districts are already small. More here...

Colorado Governor Unveils Plan to Close Budget Shortfalls
Colorado Governor Bill Ritter this week unveiled a plan to close a $286 million budget shortfall, the latest in a series of shortfalls caused by the economic recession. Governor Ritter's plan would cut $145 million in funding for public colleges and universities, $37 million in grants to counties that produce oil, gas, and minerals, and $16 million in delayed Medicaid reimbursements. It also would save $27 million by adding four additional furlough days for state workers. The cuts to higher education will be replaced with funds from the American Recovery and Reinvestment Act. While the one-time federal stimulus funds will save the state from serious cuts now, critics of Governor Ritter's plan say he is putting off necessary decisions about how to reduce the state budget in the future. Colorado State Senate Minority Leader Josh Penry proposed closing Governor Ritter's energy office, and has mentioned other cuts that could lead to long-term budget trimming. Governor Ritter called these proposals "a $100,000 solution to a $100 million problem." More here...

School Districts in Oklahoma Face Steep Cuts as Funding Streams Dry Up
In Oklahoma, school districts are bracing for deep cuts as the state's revenue shortfalls lead funding streams to dry up. The state account that usually contributes more than 25 percent of the state's education funds is likely to be completely empty by the end of October, leaving the state to rely solely on tax collections for payments to districts starting in November. This comes on top of a 5 percent budget cut for the current fiscal year across all state agencies. The state is encouraging districts to try to make cuts without removing teachers from classrooms, but with such great budget reductions, officials recognize this is a tall order. School districts also may be consolidated or closed to save money. More here...

New York Governor Proposes New Cuts as Deficit Climbs
New York's state budget deficit has climbed $1.1 billion since July to $3.2 billion according to a report released this week. The state Budget Division also predicts that next year's budget will total $6.8 billion, a $2.2 billion increase from the July estimate. With this in mind, Governor David Patterson proposed wiping out $5 billion in spending over the next two years. While most state legislators supported many of the cuts, State Senate leaders opposed cuts to education and Medicaid. Governor Patterson has ordered a special session of the state legislature starting on November 10^th to address the increasing shortfall. More here...

Massachusetts Governor Makes New Cuts, Spares Education
Massachusetts Governor Deval Patrick this week cut $277 million from the state's fiscal year 2009 budget to close a growing gap between revenues and spending. This included budget cuts to state agencies, nine-day furloughs for 4,000 state employees, and layoffs for 2,000 state workers. While K-12 school aid was spared in this round of cuts, school districts may still feel the pinch as regional school bus transportation aid and state reimbursements for special education schools were cut. Charter schools will also feel the blow of a $5 million cut in reimbursements. Governor Patrick was able to use federal stimulus dollars to avoid cuts to state colleges and universities. More here...

Briefly Noted

Michigan budget nears completion, but contentious items still could face line-item vetoes.
Districts in Minnesota await outcome of Nov. 3^rd vote on school levies.

Comparing State and Nationally Defined Graduation Rates

Jennifer Cohen — Thu, 29 Oct 2009 21:33:00 -0400

Earlier this month the National Center for Education Statistics (NCES) released a preliminary report on graduation rates in the 50 states and the District of Columbia for the high school class of 2006-07. The report shows that graduation rates vary widely by state - from as high as 88.6 percent to as low as 52.0 percent - and by student race or ethnicity. Interestingly, the NCES figures differ from the graduation rates most states report under the No Child Left Behind (NCLB) Act. In fact, 14 states claim to have graduation rates at least 10 percentage points higher than what the national standard shows. (Data for both nationally and state defined graduation rates can be accessed on the Federal Education Budget Project website at www.edbudgetproject.org.)

NCES calculated graduation rates using a method known as the averaged freshman graduation rate. Under this method, the graduation rate is calculated by dividing the number of diplomas awarded in 2006-07 by the average enrollment of 8^thgraders in 2002-03, 9^th graders in 2003-04, and 10^th graders in 2004-05. Averaging 8^th, 9^th, and 10^th grade enrollment controls for freshman students who may have been held back. This method is not as rigorous as a graduation rate produced using longitudinal student data because it does not track individual students as they go through high school. However, in the absence of longitudinal data in the majority of the states, it was deemed preferable to other alternatives in previous studies.

In contrast to the method used by NCES, states calculated 2007 graduation rates in a variety of ways to meet the accountability requirements for NCLB. States were able to choose how they measured graduation rates for NCLB just as they were able to choose state definitions for proficiency in math and reading. Some may have used the averaged freshman graduation rate while others may have just divided the number of diplomas awarded in 2007 by freshman enrollment four years earlier. Some states may even have divided the number of diplomas awarded in 2007 by the number of seniors entering school at the beginning of that school year.

Most of the time, the graduation rate method selected by a state produces a higher graduation rate than what would be produced by averaged freshman graduation rate. For example, the District of Columbia reports a graduation rate of 75.5 percent for NCLB purposes. The NCES calculation gives DC a graduation rate of 54.9 percent, 20.6 percentage points lower. Similarly, Alabama's NCES graduation rate is 16.0 percentage points lower than its NCLB reported graduation rate of 83.1 percent, and Nevada's NCES graduation rate is 15.4 percentage points lower than its NCLB reported rate of 67.4 percent.

Some states, however, do understate their graduation rates in their NCLB report cards. Minnesota reports a graduation rate of 73.3 percent, 13.2 percentage points lower than its NCES calculated rate. Missouri also reports a graduation rate 9.1 percentage points lower than its NCES rate of 81.9 percent. In total, eight states report a graduation rate lower than the nationally defined rate. Unfortunately, it is impossible to tell what is driving these differences without examining each state's NCLB accountability plan.

The Department of Education is working to eliminate the disconnect between nationally and state defined graduation rates. For example, recent federal investments in state longitudinal data systems suggest that states will soon be able to calculate graduation rates using individual student data rather than student enrollment and diploma data. Using student longitudinal data would allow states and schools to track students individually as they move from school to school, ensuring a more accurate graduation rate. Additionally, the Department of Education released guidance last December that would require states to report a four-year adjusted cohort graduation rate for the high school class of 2012. This method would calculate the graduation rate as follows:

But standardizing the way graduation rates are calculated is only half the battle. No matter how you look at it, at least 25 percent of American high school students fail to graduate in four years. In an economy that requires at least a high school degree to make a living wage, this trend could spell disaster for economic recovery in the near future.

While both pending House and Senate 2010 education funding bills include $50 million for a new high school graduation initiative, this is just a drop in the bucket what is likely needed to improve graduation rates. America is going to have to get much more serious about providing the support students need to graduate from high school.

A spreadsheet containing data on nationally and state defined graduation rates is available here.

ARRA Reporting Soon to Include School-Level State and Local Expenditures

Jennifer Cohen — Tue, 27 Oct 2009 21:17:00 -0400

State education agencies across the country just completed the first round of reporting for the American Recovery and Reinvestment Act (ARRA) programs, an onerous and massive undertaking. Unfortunately, the quarterly reporting process is not likely to get any easier for states from here - on December 1^st, 2009 the Department of Education (ED) will require districts to report local and state expenditures at school-level for the 2008-09 school year, the first time such data has ever been required for any program. Rather than tracking federal funds like the majority of ARRA reporting, the school-level data will show baseline state and local funding at schools in districts that receive federal Title I Part A funds. As a result, this data could help determine whether districts and schools are using federal funds to supplement, rather than supplant, state and local funding.

Draft Department of Education guidance for the new school-level reporting indicates that any districts receiving Title I Part A funds will have to report school by school expenditures for the 2008-09 school year on:

All personnel salaries including instructional and support staff;
Personnel salaries for instructional staff only;
Personnel salaries for teachers only; and
Non-personnel expenditures.

Districts and state education agencies fear that these new requirements will present overwhelming burdens for staff. Given the current state of district accounting systems, this reaction isn't surprising. Few accounting systems in use break out salary expenditures by school and even fewer can calculate non-personnel expenditures by school. In fact, many school districts can only calculate school-level salary expenditures by multiplying the number of full time equivalent employees employed at each school by the average staff salary in the district. Non-personnel expenditures are even more complicated because most districts purchase materials and services on a district-wide basis, rather than school-by-school.

Districts will have to work double-time to produce the data required for the December 1^st reporting, and state agencies will have to implement quality assurance systems to make sure the data are good. At the district level this could include implementing entirely new accounting systems or hiring consultants to mine last year's expenditure data for the information needed. At the state level this likely means putting even more work on the plates of overwhelmed employees. Regardless, the rapidly approaching deadline and lack of finalized guidance from ED has state and local officials nervous.

But the value of this new data cannot be overstated - it's availability has important implications for the reauthorization of the Elementary and Secondary Education Act (currently known as the No Child Left Behind Act). This data could be used to strengthen the "supplement not supplant" provision of Title I by determining baseline funding from state and local sources among Title I and non-Title I schools in Title I districts. While even funding distributions among schools would suggest that federal funds are being used to provide additional services for disadvantaged students, disproportionate distributions can be used to identify districts that use federal funds to replace state and local funds in schools with large disadvantaged populations.

Further, the availability of school-level teacher salary data could be used to strengthen the "comparability" provision of Title I which requires districts to spend equal amounts on instructional staff salaries in Title I and non-Title I schools. Rather than use full time equivalent average salaries or student-teacher ratios to approximate school-level expenditures, as districts are currently allowed to do, districts could use actual spending on teacher salaries in each school to demonstrate comparability.

While reporting school-level expenditures will be an onerous task for school districts and states, it will provide an important source of information on education spending as long as the guidance is published quickly and clearly. Ed Money Watch will continue to follow these new reporting requirements as guidance is finalized.

Friday News Roundup: Week of October 19-23

Emilie Deans — Fri, 23 Oct 2009 19:02:00 -0400

Michigan Governor Signs Education Budget, Vetoes Some School Funding

Education Not Spared in Iowa Governor's Budget Cuts

Lawsuits Filed Over Hawaii Teacher Furloughs

Massachusetts Disputes Pew Report on Early Education Spending

Mississippi Contemplates School District Consolidations

Michigan Governor Signs Education Budget, Vetoes Some School Funding
This week, Michigan Governor Jennifer Granholm signed the state's education budget for fiscal year 2010, but not without a line-item veto of $51 million in supplemental payments for the state's 39 largest and highest spending school districts. Governor Granholm said she was forced to veto the spending because the legislature did not provide enough revenue to pay for the budget. Michigan Senate Republicans say that there was sufficient funding for the payments, and that the Governor is using it as an excuse to push for higher taxes. Separately, The State Board of Education has moved its November 10meeting up to October 26 to address the 2.9 percent overall cut in the education budget for the 2010 fiscal year. More here and here...

Education Not Spared in Iowa Governor's Budget Cuts
Iowa Governor Chet Culver this week announced a 10 percent across-the-board budget cut for state agencies. In addition to laying off 791 government employees and leaving 529 positions vacant, departments will have to make cuts to programs and services. Education is no exception. As a result, fewer students will be able to attend preschool for free, college financial aid will be cut, and school lunch prices will go up. Governor Culver wants to force school districts to spend their reserves before raising property taxes to cover state aid cuts. However, many school districts won't have enough money in their reserves to cover the cuts. Some of these districts may resort to cutting programs rather than raising taxes. Community colleges are also seeing cuts in state aid, forcing them to cut services, layoff staff, or hike tuition. Governor Culver has warned that more cuts are likely next year. More here...

Lawsuits Filed Over Hawaii Teacher Furloughs
Two separate groups in Hawaii have filed lawsuits over teacher furloughs approved by the state Department of Education and the Hawaii State Teachers Association. The groups claim that the agreement, which requires 17 furlough days in the current school year and the 2010-11 school year, would violate Hawaii's obligation to provide 180 days of schooling to resident children, five days a week. One lawsuit, a class-action case representing all Hawaii public school students, claims that the furloughs disproportionately affect children at certain income levels and of certain racial and ethnic groups. The second lawsuit, filed on behalf of the state's special education students, claims that the furloughs would cause prohibited changes to special education. State Attorney General Mark Bennett believes the suits are without merit, and will fight them. More here...

Massachusetts Disputes Pew Report on Early Education Spending
According to a report released this week by the Pew Center on the States (Pew), Massachusetts is one of 10 states that made cuts to its prekindergarten spending this year. Pew reported that the state cut aid for its universal prekindergarten program by $2.9 million, the federal Head Start program by $1 million, and scholarships, mental health services, and other "quality improvements" by $5.5 million - a combined 22 percent of the pre-kindergarten budget. State officials claim that the report does not accurately measure the state's investments in prekindergarten. They note that the Pew report focuses on three areas and doesn't take into account the overall budget of the Department of Early Education and Care, which fell only by 3.4 percent. Officials at a Boston advocacy group noted that 70 percent of the state's children aged 3 to 5 are in some form of preschool, and that the state is in the process of improving the quality of the available programs. More here...

Mississippi Contemplates School District Consolidations
Mississippi State Representative George Flaggs this week questioned whether the state can afford its 152 school districts and eight public universities. He suggested that the state consider consolidating school districts in order to save money. Interim state superintendent John Jordan said that, while he understands that these are difficult economic times, he hopes lawmakers will study the impact of consolidations before moving forward. Several school districts in the state have performed voluntary consolidations, providing an opportunity to examine the academic and financial impact of such efforts. Because the state's continuing drop in revenue forced Governor Haley Barbour to slash $172 million from the state budget last month, lawmakers are considering options, like consolidation, that they wouldn't have put on the table previously. More cuts are expected as Mississippi's financial situation becomes clear. More here...

Briefly Noted

Kansas faces $70 million education budget shortfall.
Over $115 million transferred to North Carolina Education Fund from lottery.

What the First Round of Recipient Reported Stimulus Data Tells Us: Not Much

Jennifer Cohen — Thu, 22 Oct 2009 19:30:00 -0400

Late last week the federal government released the first round of data on economic stimulus spending through the new website Recovery.gov. This preliminary data, which is reported by stimulus funds recipients, included data only for federal contracts as opposed to grant and loan programs. Very few education contracts have been awarded thus far because the majority of education stimulus funds go directly through local education agencies and institutions of higher education. However, the data does include information on 16 contracts made through Department of Education programs. Unfortunately, this data is not detailed enough to provide comprehensive information on how the funds are being spent and from what source, suggesting that future waves of stimulus recipient reported data may not be as useful as we had hoped.

These 16 contracts amount to more than $27.7 million in stimulus funding distributed by 11 states including Alaska, Kansas, Massachusetts, Minnesota, Nebraska, Oregon, Pennsylvania, Tennessee, Virginia, Washington, and Wisconsin. Thus far, the contracting organizations have received $1.9 million (6.9 percent) of the total funds. According to the data reported, these funds have either saved or created 162 jobs. (A table containing this information is available here.)

The vast majority of the contracted funds - $24 million - will be distributed through the Student Aid Administration stimulus funds in Nebraska, Pennsylvania, Virginia, and Wisconsin. These funds will go to service federal guaranteed loans provided to students in each of those states. Nearly $2.5 million in Title I funds will be distributed to a non-public education entity in Salem, Massachusetts to provide additional services to disadvantaged students in private schools.

The remaining $1.2 million will be distributed to various organizations for higher education, impact aid construction, State Fiscal Stabilization Fund (SFSF), and school improvement uses. In some cases, the data collected on these contracts provides useful and comprehensive information on how the funds will be spent. For example, the Benton County Board of Education in Tennessee will receive $451,600 in SFSF to retain 11 teacher jobs. Fort Leavenworth Unified School District in Kansas will receive $404,595 in Impact Aid Construction Funds to renovate the roof and interior of its gym and auditorium.

In other cases, however, the reported data provides little to no information on the source of the funds or what they will be used for. For example, Siemens Building Technologies will receive three separate grants totaling $116,812 for services they will provide at the Chemekata Community College in Oregon. The Treasury Accounting Symbol attached to these grants indicates that they are for a higher education program supported with economic stimulus funding but does not specify which higher education program. The only other information provided for each grant is a building name or number on the Community College campus.

Data collected on two school improvement program contracts are equally unclear. These two contracts, also with Siemens Building Technologies, from the Lake Washington School District in Washington State total $211,000. While the Treasury Accounting Symbol attached to these grants does not specify which school improvement program these funds are from, the brief descriptions ("Upgrades at 3 schools" and "Support Services Center") imply that they may be for Enhancing Education through Technology Grants (ED Tech). In the absence of further detail, however, we cannot be sure if that is indeed the case.

Without a doubt, the reporting requirements attached to the stimulus funds represent a major shift in how federal agencies track the expenditure of federal funds on the ground. But this first round of data suggests that the information being collected lacks the detail necessary to really track what the funds are being spent on. In many cases, the Treasury Account Symbols used in the data do not provide information on specific funding sources. Similarly, the level of detail in the recipient provided fields often lack detail on actual projects receiving funds. Hopefully these limitations will not completely undermine what could have otherwise been an invaluable tool for evaluating the success of the stimulus.

Educational Effect of the Stimulus, Through Rose-Tinted Glasses

Emilie Deans — Tue, 20 Oct 2009 15:51:00 -0400

The White House Domestic Policy Council (DPC) with the U.S. Department of Education (ED) this week released the report "Educational Impact of the American Recovery and Reinvestment Act." The report paints a rosy picture of the effect of American Recovery and Reinvestment Act (ARRA) funds on state education spending and reform.

ARRA funds have no doubt helped states make ends meet during the economic downturn. But our work (here and here) suggests that, despite a positive impact on education spending, the full effects of ARRA remain to be seen due to the slow rate at which states have disbursed funds to school districts.

Avoiding Shortfalls
According to the report by DPC and ED, the State Fiscal Stabilization Fund (SFSF), a new program created by the ARRA, helped states avoid significant funding cuts for K-12 teachers, principals, and support staff, as well as higher education personnel. As of September 30^th, $35.4 billion of the $48.6 billion SFSF appropriation had been made available to states. According to the report, states were able to restore nearly 100 percent of the 2008-09 budget gaps and a significant portion of the current 2009-10 budget shortfalls using the SFSF funding. The report also claims that the speedy availability of the SFSF allowed states to provide reliable budget numbers to districts for planning purposes.

The table below shows how much of selected state's final education budgets can be attributed to SFSF dollars. It's clear that in these states, the SFSF has significantly aided states in avoiding serious budget shortfalls.

The DPC and ED analysis of states' preliminary quarterly reports suggests that 250,000[1] education jobs, including teachers, administrators, and support staff, were retained or created thanks to ARRA funds. These jobs were created or retained in rural, urban, and suburban areas of the country,[2] saving students from the detrimental effects of increased class sizes.

However, even though nearly 70 percent of ARRA funds have been made available to the states for spending, a very small percentage has actually been disbursed by the states to school districts. While states like California and Indiana had disbursed over 60 percent of their obligated funds by October 9^th, 2009, Alaska, the District of Columbia, and Delaware had each disbursed less than 6 percent of their funds. Thus, it is unlikely that the ARRA funds have had much effect on education spending in these states.

A complete table of obligated versus disbursed ARRA funds by state is available here.

The report also suggests that the speedy availability of the ARRA funds has allowed states to give school districts reliable budget figures with which to create spending plans for the current and upcoming school years. However, according to local news reports, some states and school districts are feeling just the opposite.

Reform
The DPC/ED report also finds ARRA funds are being used by districts for reforms aligned with the Obama Administration's four priorities:

Rigorous college- and career-ready standards and high-quality assessments that are valid and reliable for all students;
Pre-K to college and career data systems that track progress and foster continuous improvement;
Improvements in teacher effectiveness and in the equitable distribution of qualified teachers for all students; and
Intensive support and effective interventions for the lowest-performing schools.

Citing reports from the media and direct accounts from districts, the DPC and ED go on to describe reform efforts in districts across the country that align with one or more of these priorities.

However, the anecdotal nature of these reports highlights an opportunity the Obama Administration missed. While there are, no doubt, serious reform efforts happening in several school districts across the country, there is no system by which they can report their efforts or findings to ED. Many states have implemented reporting requirements of their own, but they are not subject to the transparency requirements of the other federal reporting efforts in place which focus primarily on expenditures. Some states do not require this highly detailed reporting from school districts at all.

Additionally, the Administration has missed an opportunity to help school districts learn from each other as they undertake reform efforts. Given the lack of hard data on what works in school reform, ARRA-funded reform efforts could have produced a wealth of data on which approaches show promise - and which ones do not - an invaluable outcome for ARRA funds.

Conclusion
Federal economic stimulus funds from ARRA have certainly helped states stabilize their education spending. Without these funds, states and school districts would have been forced to make deep cuts to their education budgets. However, the DPC and ED report released this week leaves out vital pieces of information that suggest that much more needs to happen in states and school districts before ARRA can be deemed a sweeping success.

[1] This number is based on initial and preliminary reports. It is subject to change when reports are finalized on October 30, 2009.

[2] Information on where jobs were saved has not been officially submitted to the Department of Education nor certified by the agency because ARRA regulations require only states, not districts, to collect and report data on the use of these federal funds.

Friday News Roundup: Week of October 12-16

Emilie Deans — Fri, 16 Oct 2009 17:20:00 -0400

Study Finds that California Furloughs Don't Save As Much As Expected

Big Ten Schools Suffer from State Budget Cuts

Louisiana State Board of Elementary and Secondary Education Passes Tentative Budget

Pennsylvania Finalizes Budget, School Districts Adjust

Study Finds that California Furloughs Don't Save As Much As Expected
According to a study by the Center for Labor Research and Education at the University of California at Berkeley, California's three-day-per-month furloughs for state workers aren't saving as much as expected. The program was expected to save the state $1.3 billion this year, but the study predicts that the savings will be a little more than half that. The study also notes that the savings will decline as the real costs of furloughs come to light over the next few years. According to Ken Jacobs, chairman of the group that conducted the study, the state would actually save more money over the long term by imposing only one furlough day per month. More here...

Big Ten Schools Suffer from State Budget Cuts
Universities in the Big Ten conference are scrambling to make cuts to their budgets as state aid dwindles. While the University of Michigan and Ohio State University have managed to avoid cuts this year, the other schools in the conference are facing cuts ranging from about 1 percent to more than 5 percent for the current fiscal year - and more cuts loom for next year. Some schools, like Penn State and the University of Illinois, are depending on state aid to keep budget cuts low for this year. At Perdue, where 5.3 percent of the budget will be cut in the current fiscal year, faculty will not receive merit salary increases, among other cuts. Other schools are halting construction projects and shutting down during breaks from classes. Many universities still have not determined all the cuts necessary to avoid shortfalls. More here...

Louisiana State Board of Elementary and Secondary Education Approves Tentative Budget
The Louisiana State Board of Elementary and Secondary Education (BESE) this week approved a $3.276 billion preliminary education budget for fiscal year 2011. State regulations require agencies to submit preliminary budgets by November 5^th so that the governor's office can begin assembling an executive budget. Changes can be made to the budget later in the process, and many Louisiana school district superintendents believe changes are necessary. The approved K-12 budget recommendation includes a 2.75 percent increase, a growth factor that is normally included in the school funding formula, but which state superintendents waived in the current fiscal year to help the state avoid deficit spending. But now superintendents believe they will need more than the 2.75 percent, or $62.25 million, increase to keep schools running, especially given decreasing local tax revenues and significant increases in retirement and health care benefits for teachers and other school employees. The BESE will be able to make changes to its recommendations when firmer financial data are available before the final budget goes before the state legislature. More here...

Pennsylvania Finalizes Budget, School Districts Adjust
After a standoff between Governor Ed Rendell and the state legislature over spending priorities, Pennsylvania finalized its state spending plan on October 9 - 101 days after the deadline. School districts, on the other hand, had to approve their 2009-10 budgets on time, over three months ago. As a result of the state's delay, district leaders had to estimate state contributions to K-12 education. While some districts planned cautiously, others overestimated their chunk of the $27.8 billion education budget, and must find ways to scale back. Thanks to federal stimulus dollars, however, the state's education budget actually increased by $300 million, or about 5.7 percent, to provide increased subsidies and grants for schools. Despite the influx in federal money, some programs didn't receive increases, while others were eliminated completely. The state will freeze spending on special education, Pre-K Counts, Head Start, and Accountability Block Grants at the 2008-09 level, while Classrooms for the Future, Teen Pregnancy and Parenthood, and Safe and Alternative Schools programs will be eliminated. More here...

Briefly Noted

Hawaii furloughs won't close gaps - more layoffs may loom.
Florida governor warns agencies to brace for cuts as Education Department requests more.