More Twists in the Education Jobs Fund Saga

Much has happened since Ed Money Watch wrote about the Education Jobs Fund last Thursday. First and foremost, the House passed the amended version of the war supplemental bill that included $10 billion for the Education Jobs Fund. This program would provide additional funding to states to save jobs in K-12 education. The passed version also includes $800 million in education program rescissions including $500 million from Race to the Top, $200 million from the Teacher Incentive Fund, and $100 million from Charter School Grants.

But the move to pass the new version of the Education Jobs Fund has riled some intense opposition. U.S. Secretary of Education Arne Duncan balked at the cuts to education reform programs and offered to work with House leaders to find other education programs to cut. The Obama Administration notified House leaders that it would recommend a veto of the supplemental bill if it included the rescissions to Race to the Top and other programs. And a group of 13 moderate Democrats in the Senate submitted a letter to Chairman of the Senate Appropriations Committee, Daniel Inouye (D-HI), decrying the House bill’s cuts to important education reform programs.

Some state education leaders are also less than pleased with the proposed $500 million in cuts to Race to the Top. Ed Week talked with officials from South Carolina, Louisiana, and Florida who all expressed dismay that Race to the Top funds could be cut, potentially limiting the number of states that would receive awards. All three of these states submitted round two applications for Race to the Top because of the large amount of money remaining for the program.

One state, Texas, has been singled out in the Education Jobs Fund bill language for extra special treatment. Last Friday, the House passed an amendment to the Education Jobs Fund that would place restrictions on the use of funds in Texas. According to Congress Daily, Texas House Democrats crafted the amendment to ensure that the state of Texas does not misuse this new round of funding like they claim the state misused State Fiscal Stabilization Fund (SFSF) monies in the past.

Specifically, these legislators claim that Texas used SFSF monies to supplant state spending for education, padding the state’s rainy day fund instead of supporting the state’s schools. To combat this, the amendment would require that Texas distribute Education Jobs Fund monies via the Title I formula, rather than the state’s primary education funding formula. Additionally, Texas Governor Rick Perry must certify that K-12 education spending in fiscal years 2011, 2012, and 2013 will remain at the same proportion of total state spending as was determined for fiscal year 2011 before the passage of the Education Jobs Fund. Unless the Governor agrees to both of these requirements, no allocation shall be made to Texas.

Of course, the situation surrounding this Texas provision is far from straight forward. Some Texas officials claim that the state used SFSF monies in the same manner as all other states and is being singled out because it chose not to participate in Obama Administration programs like Race to the Top. They claim that the Texas-specific provisions in the Education Jobs Fund will actually hurt Texas’ schools and students by depriving them of the federal money if the state is unable to comply with the requirements.

Between the unpopularity of the Education Jobs Fund in the Senate, disagreement surrounding the education program rescissions, and the new controversy with the Texas provision, the conference committee on the supplemental funding bill is likely to be drawn out and contentious. It seems unlikely that any of these provisions will make it out of conference unchanged. And if they do, the President seems unlikely to sign a bill that cuts spending for Race to the Top and other programs. Check back with Ed Money Watch for updates.