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Nation's schools would get $106 billion from federal economic stimulus package

California's deficit means education cuts still loom, but federal money would narrow the gap. It would pay for special education, building repair and keeping teachers who might otherwise be laid off.

February 13, 2009|Seema Mehta and Jason Song

The massive federal economic stimulus package hammered out by Congress this week contains about $106 billion earmarked for education, an unprecedented expansion of federal spending into the nation's schools. District officials throughout California, bracing for another round of painful state budget cuts, were grateful for a new infusion of funds.

The money would pay for, among other things, special education, school repair and retaining teachers who might otherwise be laid off.

"It's one of the most exciting things we've heard about in a long time," said Chris Eftychiou, spokesman for the nearly 90,000-student Long Beach Unified School District, which stands to gain tens of millions of dollars over the next two years.

"Usually, it's just cuts, not additional revenue."

But officials noted that with the state budget facing a nearly $42-billion gap next year, cuts still would be necessary.

The Los Angeles Unified School District, the nation's second-largest, faces a nearly $677-million shortfall next year and expects more cuts the following year. But the district is in line to receive nearly $1 billion in federal aid over that time.

"I hope the federal government is going to come through, but . . . it's not large enough to fill the deficits we're going to have," said Megan K. Reilly, L.A. Unified's chief financial officer.

The House and the Senate passed competing versions of a massive federal plan to shore up the nation's economy in recent days, and as they tried to reach a compromise, education spending was one of the main sticking points. Congressional leaders reached a $789-billion agreement Wednesday that is expected to be voted on and sent to the president's desk in the next few days. Details were still emerging Thursday, and many local districts have yet to figure out exactly how much they stand to gain.

The compromise provides tens of billions less for education than an earlier House of Representatives plan, but more than the Senate version.

The compromise includes $53.6 billion for a nationwide state stabilization fund, which includes $39.5 billion earmarked for local school districts that could be used to prevent teacher layoffs. Some of that money could be used to modernize buildings, but not to build new ones.

Additionally, more than $12 billion is included for special education, and $13 billion for the schools that serve the nation's neediest children. Money is also set aside for state student-data systems, teacher-quality grants, education technology, Head Start preschools and other programs.

Some educators say that although they had hoped the earlier House plan, which included by some estimates $148 billion for education, had survived intact, they were pleased.

"Overall, we're supporting the bill," said Joel Packer, director of educational policy and practice at the National Education Assn., which represents 3.2 million teachers, administrators and others. $106 billion "is a substantial increase in education funding. To put that in perspective, the current [discretionary] budget of the U.S. Department of Education is $60 billion."

Critics counter that it is a gross expansion of federal power into education, traditionally a state and local matter.

"This would really tip the balance of power in American education toward Washington," said Dan Lips, a senior policy analyst with the conservative Heritage Foundation in Washington, D.C. "More decisions will ultimately end up being made here."

Lips added that education spending would do little to create jobs.

"If we're looking to stimulate the economy, simply dramatically increasing federal spending on education isn't the right solution," he said. "This is basically an education budget offering dramatic increases buried in an economic stimulus package."

But state officials say that a long waiting list makes school construction among the fastest ways to create jobs. In California, according to the state Department of Education, there are 886 approved school projects on hold because of budget difficulties.

At San Francisco Unified School District, which passed two school construction bonds in recent years totaling $790 million and has a $1-billion capital wish list, officials were eager to learn how much money would be available for school modernization.

"We have projects that are shovel-ready," said Nancy Waymack, director of policy and operations at the 55,000-student district. "The modernization and repair money would be . . . not just an investment in schools, but [would create jobs] for the local economy."

The other unknown facing Waymack and other district officials is the state budget for the next fiscal year, which begins July 1.

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