Introduction

On March 13, 2020, Governor John Carney of Delaware added his state to the growing list of those closing schools to slow the spread of COVID-19.¹ Teachers had been making contingency plans all week, bringing home laptops and chargers each night and distributing work packets for students to complete at home in case school was canceled before the next morning. When the order came down, the closure was to last two weeks, from March 16 to 27.

On Monday, March 30, school doors were still closed. Dorrell Green, Superintendent of Red Clay Consolidated School District—the state’s largest district, serving a slice of the city of Wilmington and its western suburbs—was not surprised. He and his team had already begun to make plans for a longer haul, starting the process of purchasing laptops for students and reaching out to experts in online teaching. By the end of April, the state announced that there would be no return to in-person learning that school year.²

In Red Clay, as in most districts, the transition was not without its challenges. Green initially announced that remote-learning grades could only boost, not lower, students’ grade point averages so as not to disadvantage those who were having trouble logging on; some parents were displeased, seeing the policy as a retreat from rigorous academic standards.³ That summer, the district surveyed families to see how many lacked reliable internet—about 400, it turned out—and sought grant money from the county to help with internet connectivity.⁴

Red Clay entered the fall of 2020 with a new host of challenges. It was trying to operate a hybrid system with both remote and in-person learning options, and there were stumbles on both sides. Instead of virtual instruction from a classroom teacher, Red Clay initially offered remote learners self-directed learning on a web-based platform. Parents pushed back, wanting live teaching, and district leadership had to quickly make adjustments In-person learning began in November, then was shut down again by order of the governor in December.⁵ In the meantime, over 100 Red Clay students and staff had tested positive for COVID-19. Alongside these challenges, however, the district now also had some support: The first federal relief dollars had arrived.

When Red Clay reopened for hybrid learning in January 2021, in-school students stopped at new dispensers to sanitize their hands, wore masks at group-work tables divided by plexiglass barriers, and stayed three feet apart on spots marked by floor decals.⁶ Remote students logged in from home for virtual learning along with their in-person peers, and office staff fielded calls about new virus cases and reached out to close contacts of COVID-positive students and staff. By May, the district had pivoted from spending relief dollars on safety measures to focus on learning recovery, which Green knew would be a much longer-term project.⁷ It is an effort that is still ongoing.

The arrival of federal aid was a lifeline for schools attempting to continue serving students amid these new and difficult circumstances. Between March 2020 and March 2021, three COVID relief bills were signed into law, each including funding for schools through the new Elementary and Secondary School Emergency Relief (ESSER) Fund.⁸ (These allocations are sometimes called by the names of their authorizing bills, or more colloquially, as ESSER I, ESSER II, and ESSER III.) This support was unprecedented in its swiftness and its size.

Each aid package was larger than the last, and in total, Congress allocated $189.5 billion in ESSER dollars. From the start of the ESSER I spending period to the end of the ESSER III spending period, the money was available for use over a period of four and a half school years.⁹ The largest and final tranche, ESSER III, must be fully spent by January 28, 2025, barring any specially granted extensions.

The grant funds were disbursed to state departments of education with a legislative mandate to pass 90 percent of the money directly to local education agencies (that is, school districts and charter schools) with the urgent but expansive purposes of helping them to reopen schools, continue operating amid the COVID-19 pandemic, and address the many harmful effects of the pandemic on students.¹⁰ To apportion the funding, lawmakers used readiest federal tool for targeting the students with the greatest needs: the Title I formula, which usually determines the annual aid for districts serving students in poverty. The grant dollars were split among districts in proportion to their prior-year share of Title I funds.

This money was vital for district leaders like Superintendent Green, allowing him and his team to establish safer learning spaces and support students personally and academically. However, it was also an enormous challenge for school systems around the country to spend and manage this funding to best effect in the context of the ongoing pandemic and rising economic challenges, which included illness and absences among students and staff; intensifying student needs in a range of areas; staff turnover and hiring challenges; supply chain disruptions; and state budget unpredictability. Some critics, including researchers, interest groups, and even members of Congress, have questioned whether ESSER funding has been spent quickly or well enough, reviving older conversations about whether school funding investments actually yield valuable returns for students.¹¹ The fact is, though, that ESSER funds were not a typical school funding investment. This funding was distributed in a very different manner, and with very different rules and requirements, than we see with other forms of federal and state education aid.

We already know that ESSER money helped districts continue operations during the height of the COVID-19 pandemic, maintain adequate staffing, and provide new services to struggling students. The ultimate effects of the funds on student welfare and academic achievement will not be fully known until education officials and policy researchers are able to consider several years of post-ESSER data, including indicators like standardized test scores, attendance rates, and mental health survey results. This report seeks to fill in the knowledge gap between the immediate and the long term: to determine the most significant ways in which this funding differed from school districts’ standard funding allocations, and what those differences can teach policymakers about both how to evaluate the ESSER investment and how to structure and manage future school funding distributions.

Though approximately one year still remains in the grant period, it is important to begin considering these lessons now. Some lawmakers have already rushed to judge districts’ handing of the money, pointing to as-yet unspent relief fund balances as justification for massive proposed cuts to regular federal education aid.¹² Meanwhile, leaders in a few states have proposed rejecting all federal K-12 funding, arguing that the money carries too many conditions.¹³ With such radical changes under consideration, now is the time to make sure that our understanding of the ESSER period is accurate and thorough, and to learn what we can about constructing better school funding policies going forward.

Our research into the ESSER experience yields important policy lessons. One is the need to define an investment’s purpose and evaluate its use accordingly. A second area of learning is the consequences of providing funds in such large amounts, and how to do so to best effect. A third is the impact of timing factors like spending deadlines and simultaneous funding of many different government agencies, and how to adjust timelines for greater equity and effectiveness. The final lessons relate to making funding available for truly flexible use without engendering wasteful spending.

To arrive at these conclusions, we conducted in-depth interviews with a number of district and state officials involved in administering and using dollars. Interview subjects included district leaders (superintendents, chief finance officials, and one school board member) from nine districts; multi-person teams in two state education agencies; and senior staff at two state affiliates of the Association of School Business Officials. Interviewees came from nine states, including red, blue, and purple states. Local leaders came from urban, suburban, and rural districts, with enrollments ranging from approximately 3,000 to over 80,000. Total ESSER allocations among interviewees’ districts were under $4 million in the smallest instance and over $400 million in the largest.¹⁴ To contextualize interview responses, we also reviewed ESSER rules, regulations, and guidance; general rules regarding the use of federal dollars; and academic studies about federal education aid.

It is important to note at the outset that while the various practitioners interviewed had different experiences receiving, budgeting, and using these funds, they were quick to express gratitude for the money. Those who led school districts and state education agencies during the height of the COVID-19 pandemic generally felt that if they had not received these funds, the result would have been far worse outcomes for students.