Final Stimulus Package Gives $130 Billion to Education

Final Stimulus Package Gives $130 Billion to Education

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By and
Updated on Feb 20, 2009

The historic economic stimulus package took a topsy turvy route from inception to approval by President Obama last week. The final measure topped out at $787 billion, with a total of $130 billion directed towards education.

When the original bill left the House two weeks ago, it included $177 billion in funds for education. Republican members of the Senate sought to make cuts in what they saw as a bill laden with fat that would not work to stimulate the economy. Education spending took a hit, especially the money reserved for school construction, with Republicans arguing that maintaining buildings should be the job of states and districts.

An amendment to the bill offered by Sen. Ben Nelson (D-Nebraska) and Sen. Susan Collins (R-Maine) brought the price tag for education down to $97 billion. However, a series of negotiations and hard battles on the part of Democrats restored much of the education money. The sticking point was school construction; Republicans expressed concerns that if the federal government starts funding school construction now, it would set a precedent for funding such projects in the future: not a good idea, they say, for a government facing trillions of dollars in debt. Not surprisingly, the $25 billion originally reserved for school construction did not survive negotiations, and was removed from the final bill.

“A lot of money did come out of education,” says John Laughner, legislative manager for the Committee for Education Funding, a nonpartisan and nonprofit education coalition. “The conference committee was scrambling to find money for school construction without increasing the size of the bill.”

They did find, and successfully negotiate for, some funds to go towards school buildings. Language was written into the bill allowing states to use money in the state stabilization fund for their construction needs, though that only includes modernization of existing buildings, not new construction. They also found some tax break money to put towards school bonds; with the bond market frozen due to the financial crisis, many schools have had a difficult time selling their bonds.

“Education came out pretty good during negotiations,” Laughner says “We were very encouraged to see Senators go to bat for education.”

Though education went through some rough and tumble times during these policy wars, analysts agree that $130 billion is not too shabby. Because it is part of the stimulus package, the money needs to be spent over the next two years. Here are some highlights on how the money breaks down:

  • Education Technology: $650 million. This money would create computer and science labs, and provide teacher technology training. This was significantly reduced from the original $1 billion in the House bill.
  • Improved Teacher Quality: $200 million in incentive money for teachers and administrators who raise student achievement in high-need schools.
  • Title I Program for Disadvantaged Children and Special Education Students served under the Individuals with Disabilities Act (part of No Child Left Behind): $24 billion. For the past eight years, the U.S. Government has only been funding 17 percent of the 40 percent it promised for student with disabilities. The stimulus package would bump that up significantly.
  • Head Start: $2.1 billion. The bill would give an additional 110,000 students access to the Head Start program, based on need.
  • Child Care Development Block Grant: $2 billion. This would provide child care services to an additional 300,000 children from low-income families.
  • Spending on Pell Grants: $15.6 billion. This would increase the maximum Pell Grant by $500, from $4,850 to $5,350. During negotiations, Democrats successfully fought to keep this money after it was cut in the Senate.
  • Statewide Data Systems: $250 million. The Senate removed this money, but negotiations restored it. This money would improve systems in an effort to create more accountability.
  • State Stabilization Fund: $54 billion. This money is set aside to fix immediate budget problems. Of this, $40 billion is meant for K-12 and higher education and $5 billion is to go towards State Education Performance Grants—competitive grants chosen based on a school's success in creating data systems, distributing teachers, and improving assessments for special education and English-language learners.
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