Friday News Roundup: Week of June 1-5

At Ed Money Watch, we discuss and analyze major issues affecting education funding. In our Friday News Roundup, we try to highlight interesting stories that might otherwise get overlooked. These stories emphasize how federal and state policy changes can affect local schools and districts.

$100 Million in Stimulus Funds at Risk in Tennessee

South Carolina Supreme Court Orders Governor to Apply for Stimulus Funds

Kentucky Educators Will Be Spared Major Cuts

Stimulus Funds are Slow to Reach Pennsylvania Schools

$100 Million in Stimulus Funds at Risk in Tennessee
Tennessee schools could lose $100 million in stimulus funds because of a failed legislative effort to expand access to charter schools. Last week, Democrats in the state legislature blocked a bill attempting to make more students eligible to enroll in charter schools. The bill would have allowed any students receiving federal free and reduced-price lunch in the state’s 11 largest districts to enroll in charter schools, significantly expanding the number of students who would be eligible. U.S. Education Secretary Arne Duncan warned that blocking this bill could cost the state’s schools $100 million in “Race to the Top” funds intended to encourage innovation. State Democratic lawmakers say they’ll reconsider their stance, given the high stakes. Legislators hope to pass a bill before their session ends in the next few weeks. More here.

South Carolina Supreme Court Orders Governor to Apply for Stimulus Funds
The South Carolina Supreme Court ordered Governor Mark Sanford to apply for $700 million in federal stimulus money for which the state is eligible under the American Recovery and Reinvestment Act of 2009. Governor Sanford objected to the stimulus money on grounds that it would devalue the U.S. dollar and increase the federal debt. State legislators attempted to circumvent the governor by passing a budget that assumed receipt of the stimulus dollars. The state’s high court ruled with the legislature, stating that the governor does not have the discretion to refuse the money on behalf of the state. South Carolina education officials estimated that without the stimulus money, schools would have to cut 2,600 jobs, including 1,500 teachers. Governor Sanford says he won’t appeal the ruling. More here.

Kentucky Educators Will Be Spared Major Cuts
Kentucky Governor Steve Beshear this week told state education officials that he will use stimulus funds the state will receive under the American Recovery and Reinvestment Act to prevent major cuts in education spending for fiscal year 2010. Under Governor Beshear’s plan, State Fiscal Stabilization Funds and other stimulus dollars would be used to hold funding for public universities and the Kentucky Community and Technical College System at fiscal year 2009 levels. Primary and secondary education will see a minimal cut, and funding under Support Education Excellence in Kentucky, the state’s main K-12 funding formula, will not be cut. In addition, teachers will receive the 1 percent pay raise mandated in the 2008 biennial budget. School districts will not receive additional funds for this raise and must find a way to pay for it on their own. A state fund that helps pay for textbooks, professional development, and pre-school will be cut from $154 million in fiscal year 2008 to $117.9 million in 2010. Lawmakers are concerned about using federal stimulus money to fill in these holes now, leaving less money for the coming years, but they say their immediate concern is to preserve education funding now. More here.

Stimulus Funds are Slow to Reach Pennsylvania Schools
The federal government has already sent $400 million in stimulus funds under the American Recovery and Reinvestment Act to Pennsylvania, but school districts have yet to see any of the money. Money intended for the districts must pass through the state legislature – where the state budget for 2009-2010 has not yet been approved. Legislators also have failed to adopt a bill that would allow stimulus dollars to flow to districts before the budget is passed. In addition, the state has yet to complete a final application with the U.S. Department of Education for State Fiscal Stabilization Funds under the under the American Recovery and Reinvestment Act. Governor Ed Rendell’s plan includes increasing state spending for education, while state senate Republicans would like to lower state contributions and use State Fiscal Stabilization Funds to fill gaps in education spending. State Education Secretary Gerald Zahorchak has said that the Senate Republicans’ plan would have a devastating effect on districts. While the state legislators fight over the budget, school districts remain very uncertain about what to expect. Without reliable estimates of what they’ll receive, districts can’t engage in serious planning about how to best use the money, leaving them confused and frustrated. More here.

Briefly Noted

• Massachusetts higher education group files complaint about use of stimulus money.