It’s the $51 million question: How soon can Idaho school districts expect to see their share of the money that Idaho stands to receive as part of the education jobs fund passed by Congress?
Secretary of Education Arne Duncan and other officials from the U.S. Department of Education held a conference call Thursday afternoon, August 12, to share details of how states and school districts will get their shares of the money and how it can be used. More than 800 people joined the call.
As one of the first state education leaders to ask a question, Idaho Education Association President Sherri Wood relayed a conversation she had with State Superintendent Tom Luna in which he said the state may not meet all maintenance of effort requirements for securing the funds. DOE officials assured Wood they’ll be “happy to work with the state superintendent directly” to be sure that Idaho qualifies for its $51 million share of the funds.
The State Department of Education affirmed in its weekly e-newsletter, “In the coming days, the State Department of Education and the Office of the Governor will be working closely with the U.S. Department of Education to nail down estimates for how much each local education agency (LEA) will receive and to ensure Idaho meets the maintenance of effort requirements. “
U.S. Department of Education officials made it clear that the sooner a state applies for its share, the sooner it will be approved. The DOE sent application materials to governors and state education officials today (August 13), and although states have until September 9 to apply, DOE officials said they hope applications will start arriving as soon as Monday, August 16. (Read the letter to governors here.)
According to an August 6 U.S. Department of Education analysis, Idaho is due to receive $51, 641,026 to fund education jobs. Calling the jobs fund’s passage “an extraordinary victory for children across the country,” Duncan said officials intend to see the money reverse some of “the very tough, brutal cuts” that districts across the country have had to make in recent months. He added that “we also need to see governors act with a real sense of urgency” to be sure that funds flow to local districts as the new school year begins.
How will funds under the Education Jobs Fund be allocated to States?
The $10 billion Education Jobs Fund will be administered by the U.S. Department of Education under the terms and conditions of the State Fiscal Stabilization Fund (SFSF), Title XIV of Division A of the American Recovery and Reinvestment Act of 2009 with exceptions as noted here.
The U.S. Secretary of Education is required to allocate the funds as follows:
(1) one-half of one percent, or $50 million, to the outlying areas;
(2) $1 million for administration;
(3) one-half of one percent, or $50 million, to the U.S. Secretary of the Interior for schools operated or funded by the Bureau of Indian Affairs; and
(4) the remaining amount, $9.899 billion, to the States (defined as the Governor) as was done under the SFSF – 61 percent on the basis of their relative population of individuals aged 5 through 24; and 39 percent on the basis of their relative total population.
Each State may reserve up to two percent of its allocation for administrative costs for the purposes of administering the Education Jobs Fund only. Any funds that a Governor does not award as subgrants or otherwise commit within one year of receiving the funds shall be returned to the U.S. Secretary of Education to be reallocated to other States.
How soon will the money be available?
The U.S. Secretary of Education must award funds to States no later than 45 days after the date of enactment to States that have submitted applications meeting the requirements set in the law. The Education Jobs Fund was signed into law on August 10, 2010, which gives the Department until September 24, 2010 (tentative date).
The U.S. Secretary of Education cannot “require information in applications beyond what is necessary to determine compliance with applicable provisions of law.” The Department anticipates enabling a State to draw down its funds within about two weeks of receiving an approvable application.
What happens if the Governor does not apply for the funds?
If, within 30 days after the date of enactment, or by no later than September 9, 2010, a Governor has not submitted an approvable application, the U.S. Secretary of Education shall provide for funds allocated to that State to be distributed to another entity or other entities in the State under terms and conditions set by the Secretary. Regardless of the entity or entities selected, no distribution shall be made to the State unless the Secretary determines that the State meets the law’s maintenance-of-effort requirements.
How will the funds be distributed locally?
After setting aside up to two percent for administrative costs, a State must allocate the remaining funds to local educational agencies for the support of elementary and secondary education in order to retain or create education jobs for the 2010-11 school year (or for funds received through state reallocations, for the 2010-11 or the 2011-12 school year).
Funds shall be distributed through either the State’s primary elementary and secondary funding formulae or based on local educational agencies’ relative shares of funds under Title I, Part A of the Elementary and Secondary Education Act (ESEA) for the most recent fiscal year for which data are available.
Which local distribution formula should my State choose?
As soon as possible, you should request allocations by school district under both formulas – the State’s primary elementary and secondary funding formulae and the ESEA Title I, Part A federal formula – from your State education agency to determine which formula is most favorable to retaining and creating the most education jobs.
As an interim step, you can calculate a “rough” estimate by school district for each formula as follows. For the State’s primary education funding formulae, you will need to obtain the allocations by school district made under SFSF – Education Grants, preferably in a spreadsheet format, from the State education agency. For each individual school district, calculate the district’s share of funding as a percentage of the total under the SFSF – Education Grants; and apply that percentage to the State’s allocation under the Education Jobs Fund (a link to preliminary state estimates is available above), less two percent withheld by the State for administrative costs. This will give you a rough estimate only.
Similarly, calculate each district’s share of funding as a percentage of the total under the federal Title I, Part A formula (available from the U.S. Department of Education in an Excel spreadsheet for each state at http://www2.ed.gov/about/overview/budget/titlei/fy10/index.html); and apply the percentage to the State’s allocation under the Education Jobs Fund. Again, this will provide you with an approximation only. (Note that the amounts by school district provided by the U.S. Department of Education are “gross” amounts and do not reflect subsequent adjustments made by the State.)
The Governor will indicate which funding formula the State will use on the application to be submitted to the Department.
What are allowable uses of the funds?
Funds awarded to local educational agencies may be used only for compensation and benefits and other expenses, such as support services, necessary to retain existing employees, to recall or rehire former employees, and to hire new employees, in order to provide early childhood, elementary, or secondary educational and related services. The U.S. Department of Education has also confirmed that funds can be used to restore furloughs and pay cuts negotiated to avoid layoffs. The Governor or any other State official cannot add any additional requirements on how districts can use the funds beyond what is contained in the law.
Are the funds limited to teachers only?
No. Funds may be used for compensation and benefits and other expenses for education support professionals as well.
Are there any prohibitions on using the funds?
Yes. Funds may not be used for general administrative expenses or for other support services expenditures (as those terms were defined by the National Center for Education Statistics in its Common Core of Data as of the date of enactment of the Education Jobs Fund). For example, funds may not be used for equipment, utilities, renovation, or transportation.
In addition, a State may not use funds, directly or indirectly, to
(a) establish, restore, or supplement a rainy-day fund;
(b) supplant State funds in a manner that has the effect of establishing, restoring, or supplementing a rainy-day fund;
(c) reduce or retire debt obligations incurred by the State; or
(d) supplant State funds in a manner that has the effect of reducing or retiring debt obligations incurred by the State.
What are the maintenance-of-effort requirements?
In order to receive an Education Jobs Fund grant, each State must provide assurance that State support for both elementary and secondary education and for public institutions of higher education (not including support for capital projects or for research and development or tuition and fees paid by students), measured separately, in fiscal year 2011 will be at or above either: (1) the fiscal year 2009 level (in the aggregate or on the basis of expenditures per pupil); or (2) the percentage share of total revenues available to the State as in fiscal year 2010, or; (3) in the case of a State in which State tax collections for calendar year 2009 were less than State tax collections for calendar year 2006, the fiscal year 2006 level or the percentage share of total revenues available to the State as in fiscal year 2006. There are no waiver provisions included in the law.
When do the funds have to be obligated?
The U.S. Department of Education will have to provide specific guidance on this issue, but a preliminary indication from the Department is that section 421 of the Education Jobs Fund FAQs NEA Education Policy and Practice 5 General Education Provisions Act applies, which automatically allows a State to carryover for one additional year any federal education funds that were not obligated during the period for which they were appropriated. If this is applicable, then States, and presumably local educational agencies, would have until September 30, 2012 to obligate their funds.
What other assurances are required?
Any state that has an approved application under phase II of the SFSF is deemed in compliance with the “education reform” assurances (achieving equity in teacher distribution, improving collection and use of data, improving standards and enhancing assessments, and supporting struggling schools) contained in the American Recovery and Reinvestment Act. As of August 11, 2010, the only states that have not been approved under phase II are CA, HI, NY, OK, and PR. Section 442 of the General Education Provisions Act shall not apply to a local educational agency that has previously submitted an application to the State for funding under the SFSF. The assurances provided under that application shall continue to apply to funds awarded under the Education Jobs Fund.