A First Look at the Department of Education’s Sequestration Plans

This January, across-the-board cuts in federal spending could be applied to most fiscal year 2013 appropriations, a process known as sequestration. According to the Department of Education, school programs will experience significant losses if Congress allows sequestration to move forward.

A Senate subcommittee examined the issue in detail this week. Using a Congressional Budget Office estimate that says agencies’ budgets could be cut by 7.8 percent, Secretary of Education Arne Duncan and Chairman of the Subcommittee Tom Harkin (D-IA) each issued post-sequester predictions. (Harkin’s report also includes Health & Human Services programs like Head Start.)

Both agreed the cuts would be dramatic. Title I, the federal government’s main funding stream for the education of poor children, would be awarded $1.1 billion less than in the current fiscal year. There would be $900 million less in special education grants to states. Almost 100,000 children would lose access to Head Start, and another 80,000 would be cut from Child Care and Development Block Grant subsidies. Special education preschool grants would lose nearly $30 million.

All of this means that in the event of sequestration, schools would likely be forced to cut services for students, especially considering the added burden of state and local budget crises, as well as the expiration of federal stimulus funds.

The Department of Education issued guidance late last week to state education chiefs. The memo says that four programs funded though “advance appropriations” will be exempt from cuts until the 2013-14 school year: Title I grants, School Improvement Programs, special education Part B state grants, and Career, Technical, and Adult Education grants. The guidance states that as a result, schools will not have to lay off teachers or postpone hiring for the coming school year, and that lawmakers have some time to find potential workarounds to deal with federal funding cuts.

Still, other federal education programs would feel the cuts as soon as January 2013, including Impact Aid, which received $1.2 billion in fiscal year 2012. As one witness at yesterday’s hearing pointed out, the program, which compensates districts that have a diminished revenue base because of tax-free federal property within the district, makes up a huge portion of some schools’ budgets. For those schools, cuts would present a substantial hardship this school year.

Congress may yet cancel the sequester in favor of a more generous budget for fiscal year 2013, perhaps during the lame duck session Congress will hold between Election Day and the presidential inauguration. The budget process is far from complete – only one Senate committee and a House panel have produced appropriations bills for 2013 thus far. But Duncan’s testimony and the new guidance for schools give the first inside look at the planning for sequesters happening inside the U.S. Department of Education.

A version of this post first appeared on our sister blog, Ed Money Watch.