Education Jobs Funds on the Move, Sort of

A couple months ago, Ed Money Watch discussed the status of the Education Jobs Fund, which provides $10 billion in formula-based federal grant aid that is distributed to states based on their school age and total population. At that time, 47 states and the District of Columbia had been approved for the funds, though none of them had actually drawn down and disbursed any of their allocations. Luckily, there has been some movement with the Education Jobs Fund since mid-September.

According to data reported by the states on their usage of the Education Jobs Fund, states had received $1.2 billion of the $8.9 billion in awarded funds as of November 8th, 2010. Interestingly, states reported actually spending $8.1 million more than they received. This is because Wisconsin reported spending $8.1 million though it has actually received $0 from the Education Jobs Fund. This is somewhat common practice because states can receive federal funds on a reimbursement basis after expenditures have been made.

Only four states besides Wisconsin have reported receiving or spending any Education Jobs Funds. These include California, Connecticut, Georgia, and Illinois. California has spent and received the greatest proportion of its funds – 88.9 percent of its total $1.2 billion allocation. Georgia has received and spent the second most at 49.0 percent of its $322.3 million allocation. Connecticut and Illinois, on the other hand, have barely scratched the surface of their allocations with spending at barely 1.0 percent of their allocations. The Northern Mariana Islands have also spent 12.7 percent of their $8.3 million allocation. According to the states, these expenditures are supporting 21,653 jobs.

According to the data, Texas, Wyoming, and South Carolina have not been awarded any Education Jobs Funds. Based on information from the U.S. Department of Education website, Secretary Duncan has not approved Texas’ application for the funds because the Governor could not guarantee a certain level of education funding to comply with the maintenance of effort provision. South Carolina has also not applied for the funds because it does not qualify due to previous cuts in its higher education budget. However, as we discussed in a post last week, Wyoming has submitted and received approval for its Education Jobs Fund application. Perhaps ED just has yet to include Wyoming on any of its spreadsheets.

It’s been about three months since the Education Jobs Fund was signed by the president. Under normal circumstances, it would be pretty impressive that states had already spent 13.8 percent of available funds. But the vast majority of those expenditures can be attributed to California, a state that has wasted no time in expending its Education Jobs Funds and State Fiscal Stabilization Funds. Without including California’s Education Jobs Fund allocation and expenditures, states have spent only 2.2 percent of the funds, a pretty dismal amount given the purported urgency of the funds.

So, what’s the hold up? As we’ve discussed before, the Education Jobs Funds came too late for many states and school districts to make major hiring decisions before the school year started. Similarly, these decisions are often held up by slow bureaucratic processes in the state legislature, school board, and district offices. But now that the money is available to states, and many have claimed that they need it desperately, we expect and hope that expenditures will pick up at the start of the new school semester in January.