How Much Is the Stimulus Helping States? That Depends

A government report says the Recovery Act is saving jobs, but state officials offer a bleaker picture.

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New data in a report by the federal government assert that the approximately $100 billion in funds doled out to education under the American Recovery and Reinvestment Act of 2009 have filled budget gaps and saved 250,000 education jobs, but the nation's governors and school leaders contend that some states are still in dismal fiscal straits.

According to a report recently published by Education Week, states such as Pennsylvania, New Mexico, Michigan, and Florida have been forced to make often painful adjustments to cope with declining revenues, in spite of the nearly $40 billion in stimulus funds appropriated specifically for stabilizing state education budgets.

In Michigan, for instance, the state's K-12 budget was signed by Gov. Jennifer Granholm, a Democrat, after lawmakers cut $165 per pupil in grants to school districts. Brad Biladeau of the Michigan Association of School Administrators told Education Week that school officials are struggling to figure out what to trim next.

"We've been cutting administrative expenses and support services to school districts," he said. "Now, school districts are faced with significant cuts that could impact the classroom."

Pennsylvania's final budget also offered a mixed picture for K-12 education: It offered a $300 million increase for basic education funding, but other programs saw substantial reductions. A $44.7 million technology program called Classrooms for the Future was eliminated entirely.

Even if states have been able to stave off layoffs or catastrophic program cuts, a chief concern among school officials is what will happen in the federal 2011 fiscal year when the $40 billion in state fiscal stabilization funds runs out. In contrast, the government's report, released by the Domestic Policy Council—which coordinates the policymaking process in the White House—paints a much rosier picture of states' coffers. Based on preliminary reports submitted by funding recipients, the paper (available here) purports that the Recovery Act has "enabled states to restore nearly all of their projected education budget shortfalls for fiscal year 2009 and fiscal year 2010."

A survey released last August by the American Association of School Administrators showed that K-12 district leaders wanted more flexibility in the funding and that a large percentage of the stimulus monies were being used for one-time costs such as professional development and classroom supplies.

Right now, Florida is facing a $1 billion budget deficit, but that amount would be closer to $2 billion without the federal help, Education Week reports.

Final reports from stimulus funding recipients will be published on www.Recovery.gov on October 30.

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