Title I Funding Formula: How it Works and What s Ahead

1. Title I Funding Formula: How it Works and What’s Ahead Steven Spillan, Esq. sspillan@bruman.com Brustein & Manasevit, PLLC

2. Title I: Purpose To ensure that all children have a fair, equal, and significant opportunity to obtain a high-quality education and reach, at a minimum, proficiency on challenging State academic achievement standards and state academic assessments.

3. Title I: Purpose Meeting the educational needs of low-achieving children in our Nation's highest-poverty schools, limited English proficient children, migratory children, children with disabilities, Indian children, neglected or delinquent children, and young children in need of reading assistance

4. Title I: Purpose Closing the achievement gap between high- and low-performing children, especially the achievement gaps between minority and nonminority students, and between disadvantaged children and their more advantaged peers

5. Title I: Purpose Distributing and targeting resources sufficiently to make a difference to local educational agencies and schools where needs are greatest;

6. Title I: Funding Funds are distributed to school districts according to a set of four separate formulas: Basic Grant Concentration Grant Targeted Assistance Grant Education Finance Incentive Grant

7. Title I: Funding Although Title I, Part A funds flow through the SEA to LEAs, ED calculates the amounts at the LEA level for Basic, Concentrated, Targeted Attendance Grants. EFIG calculated for each state overall. Suballocated to LEAs via different formula.

8. Title I: Funding Many factors go into Title I formulas: poverty, population, eligibility thresholds, hold harmless provisions, etc… Primary Population Factor for Title I-A funds: School-Age Children in Poor Families

9. Title I: Funding 1% of Title I, Part A grants reserved for Outlying Areas.

10. Title I: Funding Arkansas’ Title I Allocation FY 2011 - $156,379,574 FY 2012 - $152,850,371 FY 2013? Likely to go down again due to decrease in national poverty share (according to Census data) Despite increase in poverty rate above 20%, national share decreased in last Census.

11. Title I: Basic Grant Original Title I-A formula, authorized and implemented each year since FY1966 Proportion declined from 86% in FY 2001 to 45% in FY 2012 All post FY 2001 Increases have been for Targeted and EFIG. Largest portion of Title I funds allocated Largest number of LEAs participating Due to low LEA eligibility threshold

12. Title I: Basic Grant Allocates funding to school districts based on the number of poor children they serve. (compared to national total) Also considers: Expenditure Factors Hold Harmless Level Minimum State Grant Ratable Reduction Further SEA Adjustments

13. Title I: Basic Grants Poverty Population Factor: Children aged 5-17: In poor families (based on updated 2010 Census data), In institutions for neglected or delinquent children or in foster homes In families receiving Temporary Assistance for Needy Families (TANF) payments above the poverty income level for a family of four

14. Title I: Basic Grants Eligibility Threshold: the number of children counted in the population factor must constitute 10 or more such children and more than 2% of the total school-age population. Expenditure Factor: State average per pupil expenditure for public K-12 education, subject to a minimum of 80% and a maximum of 120% of the national average, further multiplied by 0.40. The expenditure factor is the same for all LEAs in the same state.

15. Title I: Basic Grants Hold Harmless: If sufficient funds are appropriated, each LEA is to receive a minimum of 85%, 90%, or 95% of its previous year grant. 85% if the LEA’s school-age child poverty rate is less than 15%, 90% if the school-age child poverty rate is between 15% and 30% 95% if the school-age child poverty rate is greater than 30%.

16. Title I: Basic Grants Minimum State Grant: each state is to receive a minimum of: Up to 0.25% of total (if equal to or less than FY 2001 level) Up to 0.35% of total (if more than FY 2001)

17. Title I: Basic Grants A state may not, as a result of the state minimum provision, receive more than the average of: 0.25% of the total FY2001 amount for state grants plus 0.35% of any amount above the FY2001 level, and 150% of the national average grant per formula child, multiplied by the number of formula children in the state.

18. Title I: Basic Grants Ratable Reduction: After maximum grants are calculated, if appropriations are insufficient, these amounts are reduced by the same percentage for all LEAs, subject to LEA hold harmless and state minimum provisions, until they equal the aggregate level of appropriations.

19. Title I: Basic Grants After ED calculation, SEAs may make additional adjustments: 4% reservation of state total allocations to be used for school improvement grants 1% reservation or $400,000, whichever is greater, for state administration Optional reservation of up to 5% of any statewide increase in total Part A grants over the previous year for academic achievement awards

20. Title I: Basic Grants SEA Adjustments (cont): Adjustment of LEA grants to provide funds to eligible charter schools or to account for recent LEA boundary changes Optional use by states of alternative methods to reallocate all of the grants as calculated by ED among the state’s small LEAs (defined as those serving an area with a total population of 20,000 or fewer persons).

21. Title I: Formula Key PF = Population factor EF = Expenditure factor L_HH = LEA hold harmless level S_MIN = State minimum APP = Appropriation S_MIN_ADJ = State minimum adjustment L_HH_ADJ = LEA hold harmless adjustment OTR_ADJ = Other possible adjustments by the SEA SCH_IMP_ADJ = Reservation by SEA for school improvement grants S_ADMIN_ADJ = Reservation by SEA for state administration AWD_ADJ = Possible reservation by SEA for achievement awards

22. Title I Formula Key (cont) S = Sum (for all eligible LEAs in the nation) ALL = State total allocation EFF = Effort factor EQ = Equity factor S_ALL = State total allocation

23. Title I: Basic Grants Formula Step 1: Preliminary Grant 1 = PF * EF or L_HH, whichever is greater The population factor is multiplied by the expenditure factor for each eligible LEA. If this less than the LEA’s hold harmless level, the latter amount is used.

24. Title I: Basic Grants Formula Step 2: Preliminary Grant 2 = ( Preliminary Grant 1 / S Preliminary Grant 1 ) * APP or L_HH, whichever is greater The amount for each LEA in Step 1 is divided by the total of these amounts for all eligible LEAs in the nation, then multiplied by the available appropriation. Again, If this less than the LEA’s hold harmless level, the latter amount is used.Again, If this less than the LEA’s hold harmless level, the latter amount is used.

25. Title I: Basic Grants Formula Step 3: Preliminary Grant 3 = (Preliminary Grant 2 * S_MIN_ADJ * L_HH_ADJ) or L_HH, whichever is greater The amount for each LEA in Step 2 is adjusted through application of the state minimum grant provision and by a factor to account for the aggregate costs of raising affected LEAs to their hold harmless level, given a fixed total appropriation level.

26. Title I: Basic Grants Formula Step 4: Final Grant = Preliminary Grant 3 * SCH_IMP_ADJ * S_ADMIN_ADJ * AWD_ADJ * OTR_ADJ Further adjusted for the school improvement and state administration reservations, possible state reservations for achievement awards, and other possible adjustments.

27. Title I: Concentration Grants Similar to Basic Formula, with one major exception: Much higher LEA eligibility threshold Also differences regarding: LEA hold harmless State minimum grant provisions Relatively small amount of Title I (from 14% in FY 2001 to 9% in FY 2012) Approximately 48% of LEAs participating

28. Title I: Concentration Grants Poverty Population Factor: Children aged 5-17: In poor families, In institutions for neglected or delinquent children or in foster homes In families receiving Temporary Assistance for Needy Families (TANF) payments above the poverty income level for a family of four Same as Basic

29. Title I: Concentration Grants Eligibility Threshold: the number of children counted in the population factor must exceed either 6,500 such children or 15% of the total school-age population. Expenditure Factor: State average per pupil expenditure for public K-12 education, subject to a minimum of 80% and a maximum of 120% of the national average, further multiplied by 0.40. (same as Basic) The expenditure factor is the same for all LEAs in the same state.

30. Title I: Concentration Grants If sufficient funds are appropriated, each LEA is to receive a minimum of 85%, 90%, or 95% of its previous year grant. 85% if the LEA’s school-age child poverty rate is less than 15%, 90% if the school-age child poverty rate is between 15% and 30% 95% if the school-age child poverty rate is greater than 30%. Same as Basic* *Unlike Basic Grants and all of the other Title I-A formulas, the hold harmless applies to all LEAs that received grants for the previous year, even if they do not currently meet one of the Concentration Grant formula’s eligibility thresholds, unless they fail to meet one of the thresholds for 4 consecutive years. That is, an LEA that is eligible to receive a Concentration Grant in one year can continue to receive a Concentration Grant for three succeeding years, even if it does not meet either of the eligibility thresholds in those succeeding years.*Unlike Basic Grants and all of the other Title I-A formulas, the hold harmless applies to all LEAs that received grants for the previous year, even if they do not currently meet one of the Concentration Grant formula’s eligibility thresholds, unless they fail to meet one of the thresholds for 4 consecutive years. That is, an LEA that is eligible to receive a Concentration Grant in one year can continue to receive a Concentration Grant for three succeeding years, even if it does not meet either of the eligibility thresholds in those succeeding years.

31. Title I: Concentration Grants Minimum State Grant: each state is to receive a minimum of: Up to 0.25% of total (if equal to or less than FY 2001 level) Up to 0.35% of total (if more than FY 2001)

32. Title I: Concentration Grants A state may not, as a result of the state minimum provision, receive more than the average of: 0.25% of the total FY2001 amount for state grants plus 0.35% of any amount above the FY2001 level, and The greater of150% of the national average grant per formula child, multiplied by the number of formula children in the state or $340,000

33. Title I: Concentration Grants Ratable Reduction: After maximum grants are calculated, if appropriations are insufficient, these amounts are reduced by the same percentage for all LEAs, subject to LEA hold harmless and state minimum provisions, until they equal the aggregate level of appropriations.

34. Title I: Concentration Grants After ED calculation, SEAs may make additional adjustments: 4% reservation of state total allocations to be used for school improvement grants 1% reservation or $400,000, whichever is greater, for state administration Optional reservation of up to 5% of any statewide increase in total Part A grants over the previous year for academic achievement awards

35. Title I: Concentration Grants SEA Adjustments (cont): Adjustment of LEA grants to provide funds to eligible charter schools or to account for recent LEA boundary changes Optional use by states of alternative methods to reallocate all of the grants as calculated by ED among the state’s small LEAs (defined as those serving an area with a total population of 20,000 or fewer persons).

36. Title I: Concentration Grants SEA Adjustments (cont): Where the total number of children counted in the population factor for the state is less than 0.25% of the national total (as of the date of enactment of the NCLB), SEAs may allocate Concentration Grants among all LEAs with a number or percentage of children counted in the population factor that is greater than the state average for that year.

37. Title I: Concentration Grants Step 1: Preliminary Grant 1 = PF * EF or L_HH, whichever is greater The population factor is multiplied by the expenditure factor for each eligible LEA. If this is less than the LEA’s hold harmless level, the latter amount is used.

38. Title I: Concentration Grants Step 2: Preliminary Grant 2 = ( Preliminary Grant 1 / S Preliminary Grant 1 ) * APP or L_HH, whichever is greater The amount for each LEA in Step 1 is divided by the total of these amounts for all eligible LEAs in the nation, then multiplied by the available appropriation. If this is less than the LEA’s hold harmless level, the latter amount is used.If this is less than the LEA’s hold harmless level, the latter amount is used.

39. Title I: Concentration Grants Step 3: Preliminary Grant 3 = (Preliminary Grant 2 * S_MIN_ADJ * L_HH_ADJ) or L_HH, whichever is greater The amount for each LEA in Step 2 is adjusted through application of the state minimum grant provision and by a factor to account for the aggregate costs of raising affected LEAs to their hold harmless level, given a fixed total appropriation level.

40. Title I: Concentration Grants Step 4: Final Grant = Preliminary Grant 3 * SCH_IMP_ADJ * S_ADMIN_ADJ * AWD_ADJ * OTR_ADJ Further adjusted for the school improvement and state administration reservations, possible state reservations for achievement awards, and other possible adjustments.

41. Title I: Concentration Grants For states where the number of children counted in the population factor constituted less than 0.25% of the national total as of the date of enactment of the NCLB, the state total is to be allocated on the basis of the population factor among LEAs that receive grants. LEA Grant = PF / S PF * ALL or L_HH, whichever is greater ALL = Total State AllocationALL = Total State Allocation

42. Title I: Targeted Grants 22% of Title I in FY 2012 83% of LEAs participating Similar Formula to Basic: Significant differences related to how children in the population factor are counted

43. Title I: Targeted Grants Poor and other children counted in the formula are assigned weights on the basis of each LEA’s school-age child poverty rate and number of school-age children in poor families. LEAs receive higher grants per child counted in the formula, the higher their poverty rate and/or number.

44. Title I: Targeted Grants Poverty Population Factor: Children aged 5-17: In poor families, In institutions for neglected or delinquent children or in foster homes In families receiving Temporary Assistance for Needy Families (TANF) payments above the poverty income level for a family of four

45. Title I: Targeted Grants

46. Title I: Targeted Grants Weights are applied in a stepwise manner Which number is higher (count vs. percentage) is the one actually used to calculate the grant

47. Title I: Targeted Grants Example: Assume an LEA has 2,000 population factor children, the total school-age population is 10,000, and therefore the population factor percentage is 20%. First find the Number Weights, then the Percentage Weights, and use the larger of the two numbers.

48. Title I: Targeted Grants Numbers Scale: Step 1: 691 * 1.0 = 691 Step 2: (2,000 - 691) = 1,309 * 1.5 = 1,963.5 An LEA with a total number of population factor children falling within the second step of the numbers scale, the number of population factor children above 691 is weighted at 1.5. The weighted population factor counts from Steps 1 and 2 are combined (691 + 1,963.5) Total (Numbers Scale) = 2,654.5

49. Title I: Targeted Grants Percentage Scale: Step 1: 15.58% * 10,000 = 1,558 * 1.0 = 1,558 Step 2: (20% - 15.58%) = 4.42% * 10,000 = 442 * 1.75 = 773.5 An LEA with a population factor percentage falling within the second step of the percentage scale, the number of population factor children above 15.58% of the LEA’s total school-age population is weighted at 1.75. Total (Percentage Scale) = 2,331.5 (Step 1+ Step 2)

50. Title I: Targeted Grants Numbers Scale Weight: 2,654.5 Percentage Scale Weight: 2,331.5 Since the numbers scale weighted count exceeds the percentage scale weighted count, the numbers scale count would be used as the population factor for this LEA in the calculation of Targeted Grants.

51. Title I: Targeted Grants Eligibility Threshold: The number of children counted in the population factor (no weights) must constitute 10 or more such children and 5% or more of the total school-age population. Expenditure Factor: State average per pupil expenditure for public K-12 education, subject to a minimum of 80% and a maximum of 120% of the national average, further multiplied by 0.40. (same as Basic) The expenditure factor is the same for all LEAs in the same state.

52. Title I: Targeted Grants Hold Harmless: If sufficient funds are appropriated, each LEA is to receive a minimum of 85%, 90%, or 95% of its previous year grant. 85% if the LEA’s school-age child poverty rate is less than 15%, 90% if the school-age child poverty rate is between 15% and 30% 95% if the school-age child poverty rate is greater than 30%.

53. Title I: Targeted Grants Minimum State Grant: Each state is to receive a minimum of up to 0.35% of all Targeted Grant appropriations.

54. Title I: Targeted Grants A state may not, as a result of the state minimum provision, receive more than the average of: 0.35% of total state grants, and 150% of the national average grant per formula child, multiplied by the number of formula children in the state. (population factor child counts are not weighted.)

55. Title I: Targeted Grants Ratable Reduction: After maximum grants are calculated, if appropriations are insufficient, these amounts are reduced by the same percentage for all LEAs, subject to LEA hold harmless and state minimum provisions, until they equal the aggregate level of appropriations.

56. Title I: Targeted Grants After ED calculation, SEAs may make additional adjustments: 4% reservation of state total allocations to be used for school improvement grants 1% reservation or $400,000, whichever is greater, for state administration Optional reservation of up to 5% of any statewide increase in total Part A grants over the previous year for academic achievement awards

57. Title I: Targeted Grants SEA Adjustments (cont): Adjustment of LEA grants to provide funds to eligible charter schools or to account for recent LEA boundary changes Optional use by states of alternative methods to reallocate all of the grants as calculated by ED among the state’s small LEAs (defined as those serving an area with a total population of 20,000 or fewer persons).

58. Title I: Targeted Grants Formula Step 1: Preliminary Grant 1 = PF * EF or L_HH, whichever is greater The population factor (weighted) is multiplied by the expenditure factor for each eligible LEA. If this is less than the LEA’s hold harmless level, the latter amount is used.

59. Title I: Targeted Grants Step 2: Preliminary Grant 2 = ( Preliminary Grant 1 / S Preliminary Grant 1 ) * APP or L_HH, whichever is greater The amount for each LEA in Step 1 is divided by the total of these amounts for all eligible LEAs in the nation, then multiplied by the available appropriation. If this is less than the LEA’s hold harmless level, the latter amount is used. If this is less than the LEA’s hold harmless level, the latter amount is used.

60. Title I: Targeted Grants Step 3: Preliminary Grant 3 = (Preliminary Grant 2 * S_MIN_ADJ * L_HH_ADJ) or L_HH, whichever is greater The amount for each LEA in Step 2 is adjusted through application of the state minimum grant provision and by a factor to account for the aggregate costs of raising affected LEAs to their hold harmless level, given a fixed total appropriation level.

61. Title I: Targeted Grants Step 4: Final Grant = Preliminary Grant 3 * SCH_IMP_ADJ * S_ADMIN_ADJ * AWD_ADJ * OTR_ADJ Further adjusted for the school improvement and state administration reservations, possible state reservations for achievement awards, and other possible adjustments.

62. Title I: EFIG 22% of Title I in FY 2008 83% of LEAs participating In several ways significantly different from the other Title I-A allocation formulas. The first stage in the process of calculating grants is based on data for states as a whole, not LEAs.

63. Title I: EFIG Formula includes not only a population factor and an expenditure factor, but also two unique factors: Effort factor, based on average per pupil expenditure for public K-12 education compared to personal income per capita for each state compared to the nation as a whole Equity factor, based on variations in average per pupil expenditure among the LEAs in each state.

64. Title I: EFIG While population factor child counts are not weighted when calculating state total grants, they are weighted in the separate process of suballocating state total grants among LEAs. Intra-state allocation process is based on the same number and percentage scales as used for Targeted Grants, but the weights attached to each point varies based on the state’s equity factor.

65. Title I: EFIG Expenditure factor is modified through application of slightly more narrow floor and ceiling constraints for EFIG Grants.

66. Title I: EFIG State total EFIG Grants are based on each state’s share of population factor multiplied by an expenditure factor, an effort factor, and an equity factor, adjusted by a state minimum Each LEA’s share of the state total is based on comparative weighted population factor count for the LEA, adjusted by an LEA hold harmless level

67. Title I: EFIG Poverty Population Factor: In the first-stage calculation of state total EFIG Grants, same as Basic Grants: Estimated number of children aged 5-17: In poor families In institutions for neglected or delinquent children or in foster homes In families receiving TANF payments above the poverty income level for a family of four.

68. Title I: EFIG Poverty Population Factor: In second-stage suballocation among LEAs, weights are applied to these child counts before they are actually used in the formula Same as Targeted Grants with respect to the number and percentage scales used, but weights attached to each point on the number and percentage scales differs, depending on the state’s equity factor

69. Title I: EFIG

70. Title I: EFIG Effort Factor: Ratio of average per pupil expenditure (APPE) to personal income per capita (PCI) for each state divided by the ratio of APPE to PCI for the nation Resulting index number is greater than 1.0 for states where the ratio of expenditures per pupil for public education to personal income per capita is greater than national average Range limited to .95-1.05, so Largely Symbolic.Range limited to .95-1.05, so Largely Symbolic.

71. Title I: EFIG Equity Factor: based upon a measure of the average disparity in average per pupil expenditure among the LEAs of a state called the coefficient of variation (CV). An extra weight (1.4 vs. 1.0) is applied to estimated counts of children from poor families. Grants would be maximized for a state where expenditures per pupil from a poor family are 40% higher than expenditures per pupil from a non-poor family.Grants would be maximized for a state where expenditures per pupil from a poor family are 40% higher than expenditures per pupil from a non-poor family.

72. Title I: EFIG Equity Factor (cont): Typical state equity factors range from 0.0 - .25 Most states in .10 - .20 range Equity factor is subtracted from 1.30 to determine a multiplier to be used in calculating state grants The lower a state’s expenditure disparities among its LEAs, the lower is its CV and equity factor, the higher is its multiplier and its grant under the EFIG formula.

73. Title I: EFIG Eligibility Threshold: The number of children counted in the population factor (no weights) must constitute 10 or more such children and 5% or more of the total school-age population Expenditure Factor: State average per pupil expenditure for public education, subject to a minimum of 85% and a maximum of 115% of average, further multiplied by 0.40 The expenditure factor is the same for all LEAs in each state. The expenditure factor is the same for all LEAs in each state.

74. Title I: EFIG Hold Harmless: If sufficient funds are appropriated, each LEA is to receive a minimum of 85%, 90%, or 95% of its previous year grant. 85% if the LEA’s school-age child poverty rate is less than 15%, 90% if the school-age child poverty rate is between 15% and 30% 95% if the school-age child poverty rate is greater than 30%.

75. Title I: EFIG Hold harmless is not taken into consideration in the initial calculation of state total grants. It is possible that state total grants are insufficient to fully pay hold harmless amounts to all LEAs in the state. In that case, each LEA gets a proportional share of its hold harmless amount.

76. Title I: EFIG Minimum State Grant: Each state is to receive a minimum of up to 0.35% of all EFIG appropriations.

77. Title I: EFIG A state may not, as a result of the state minimum provision, receive more than the average of: 0.35% of total state grants, and 150% of the national average grant per formula child, multiplied by the number of formula children in the state. (population factor child counts are not weighted.)

78. Title I: EFIG Ratable Reduction: After maximum grants are calculated, if appropriations are insufficient, these amounts are reduced by the same percentage for all LEAs, subject to LEA hold harmless and state minimum provisions, until they equal the aggregate level of appropriations.

79. Title I: EFIG After ED calculation, SEAs may make additional adjustments: 4% reservation of state total allocations to be used for school improvement grants 1% reservation or $400,000, whichever is greater, for state administration Optional reservation of up to 5% of any statewide increase in total Part A grants over the previous year for academic achievement awards

80. Title I: EFIG SEA Adjustments (cont): Adjustment of LEA grants to provide funds to eligible charter schools or to account for recent LEA boundary changes Optional use by states of alternative methods to reallocate all of the grants as calculated by ED among the state’s small LEAs (defined as those serving an area with a total population of 20,000 or fewer persons).

81. Title I: EFIG Formula Stage 1: Calculation of State Total EFIG Step 1: Preliminary State Grant = PF * EF * EFF * (1.30 - EQ) In Step 1, the population factor is multiplied by the expenditure factor, the effort factor, and 1.30 minus the equity factor for each state.

82. Title I: EFIG Formula Stage 1 (cont) Step 2: Final State Grant = ( Preliminary State Grant / S Preliminary State Grant) * APP * S_MIN_ADJ or S_MIN, if greater The amount for each state in Step 1 is divided by the total of these amounts for all eligible states in the nation, then multiplied by the available appropriation, adjusted through application of the state minimum grant provision.

83. Title I: EFIG Formula Stage 2: Calculation of LEA EFIG Allocations Step 1: Preliminary LEA Grant 1 = ( PF / S PF) * S_ALL, or L_HH, whichever is greater The population factor for each eligible LEA is divided by the total population factor for all eligible LEAs in the state. If this is less than the LEA’s hold harmless level, the latter amount is used.

84. Title I: EFIG Formula Stage 2 (cont): Step 2: Preliminary LEA Grant 2 = Preliminary LEA Grant 1 * L_HH_ADJ or L_HH, whichever is greater The amount for each LEA in Step 1 is adjusted through application of a factor to account for the aggregate costs of raising affected LEAs in the state to their hold harmless level, given a fixed total state allocation level. The LEA hold harmless adjustment is downward for all LEAs except those at the hold harmless level.The LEA hold harmless adjustment is downward for all LEAs except those at the hold harmless level.

85. Title I: EFIG Formula Stage 2 (cont): Step 3: Final LEA Grant = Preliminary LEA Grant 2 * SCH_IMP_ADJ * S_ADMIN_ADJ * AWD_ADJ * OTR_ADJ LEA grants as calculated in Step 2 are further adjusted for the school improvement and state administration reservations, possible state reservations for achievement awards, and other possible adjustments.

86. Title I: Consolidation Title IX of NCLB allows SEAs and LEAs record expenditures of “consolidated admin” without assigning allowable costs under each individual program. Applies to every program under NCLB.

87. Title I: Consolidation SEAs may consolidate state admin from any NCLB program that authorizes use of admin. SEA must demonstrate that the majority of its resources for admin are derived from nonfederal funds SEA may adopt and use its own reasonable standards for determining this. Can be consolidated with other ED programs, as designated by the Secretary

88. Title I: Consolidation LEAs may also consolidate admin funds under applicable NCLB programs. Must have SEA approval Can be consolidated with other ED programs, as designated by the Secretary No federal cap on LEA admin, but SEAs are directed to establish limits on amount of funds that LEAs can consolidate

89. Title I Funding – What’s Next? Continuing Annual Budget Battles Sequestration? ESEA Reauthorization?

90. FY 2012 Budget Completed almost three months late, against looming shutdown deadline Cut ED funding by $233 million All programs subject to .189% across-the-board cut Some increases, including Title I FY 12: $14.52 billion (up $73 million) Would have been $7 million higher if not for rescission.

91. FY 2013 Budget President proposing to level fund Title I. House GOP Proposing $7 billion cut to ED. Senate Proposing $1.4 billion increase for ED. Neither Hour or Senate has releases detailed budget numbers.

92. FY 2013 – President’s Proposal Overall, 2.5% increase in education spending ($1.72 billion) New Race to the Top proposals for college affordability and completion, improving matriculation and reducing remediation ($1.55 billion) Legislative proposal would provide: $30 billion to modernize schools $25 billion to help hire and retain teachers $1 billion for career academies Other programs frozen at FY 12 levels (no cuts) Includes: Title I, SIG, 21st CCLC, IDEA Part B

93. FY 2013 – House GOP (Ryan Plan) Lowers spending caps by 5% in FY 2013; by 19% in FY 2014 Huge cuts in almost all areas except defense Education could lose $115 billion in the next decade Restructuring of tax code, entitlements Balances budget by 2040?

94. FY 2013 – Now What? House and Senate Appropriations Committees will draft spending bills Most Likely: Election year politics Another Continuing Resolution (CR) and long budget battle Final action on sequestration and budget will come during lame duck session

95. FY 2013 Outlook Budget and fiscal responsibility remain highly visible issues. All GOP candidates were forced to create a platform for deficit reduction. Balance between austerity and economic recovery will remain a hot issue for 2012 elections.

96. FY 2013 – Other Concerns Budget Control Act of 2011 Raised the debt ceiling temporarily Reduced spending caps by $891 billion over the next ten years Created Congressional debt Supercommittee Supercommittee failed to find $1.2 trillion in savings by November 23, 2011, so…

97. Sequestration Automatic cuts take effect January 2, 2013 Cuts to some programs may take effect immediately (mid-year) Cuts to education of up to $4.1 billion this coming year Never really intended to happen?

98. Sequestration (cont) Adjust total for interest to reflect lesser debt principal $1.2 trillion to $984 billion Divide by year from 2013 through 2021 Split between defense and non-defense spending (about $54.5 billion each) Take exempt programs out of the equation

99. Sequestration (cont.) Spread cuts equally among remaining programs in 2013 (accomplished by reducing spending caps for 2014 and beyond) Estimates on final cuts range from 5.5% - 9.1%

100. Sequestration (cont) What’s exempt? Some low income assistance programs (Social Security, Medicaid, TANF) Veterans benefits Pell grants, in first year What’s not exempt? Defense spending, among other items ESEA Title I

101. Sequestration (cont)

102. Sequestration Cuts will go into effect on January 2, 3013. Exactly how cuts will apply is still unclear. Will apply to all funds appropriated for FY 2013, as well as all unobligated funds for advance-funded programs appropriated in FY 2012 but available for obligation as of October 1, 2012.

103. Sequestration Sequestration will likely affect funding for the five major education programs which receive FY 2012 advance funding: ESEA Title I and II, Impact Aid, IDEA Part B, and CTE State Grants. But what if those funds are already obligated before January 2, 2013? Any benefit to obligating early? Unclear.

105. Avoiding Sequestration? Must be rescinded by an act of Congress through: Regular- year appropriations legislation passed by House and Senate with specific rescission language; An alternate spending plan with rescission language; or Special legislation rescinding automatic cuts All options must be approved by House, Senate, and President

106. Avoiding Sequestration Originally meant to force Supercommittee to succeed. President Obama and Speaker John Boehner (R-OH) have said that they will not allow Congress to circumvent this measure of accountability. Growing pressure from advocates and industry – especially the defense industry – may force them to change their minds.

107. Avoiding Sequestration A temporary fix (extending enactment date into Spring) is likely, unless leadership can broker a deal before the election. Unclear if having sequestration on the table is helpful or hurtful to incumbents. If nothing before election, lame duck action extremely likely.

108. ESEA Reauthorization Near-universal unhappiness with current law Pressure on both sides to reduce size/scope of federal footprint Increasing sanctions for schools In March 2011, Sec. Duncan said 82% of schools will be labeled “failing” this year.

109. ESEA Reauthorization President Obama’s Blueprint: Rebrands Title I as “College and Career Ready Students” Maintains Title I formula grants to high-poverty school districts Makes “significant changes to better support states, districts, and schools in improving achievement for all groups of students”

110. ESEA Reauthorization Obama Blueprint: Focuses on flexibility on implementing turnaround strategies Continues encouragement of competitive grants Encourages “increased resource equity at every level of the system.” Districts will be required to ensure that their high-poverty schools receive state and local funding levels comparable to those received by their low-poverty schools.

111. ESEA Reauthorization Obama Blueprint Flexibility in spending, accountability, reform strategies No mention of altering funding formulas.

112. ESEA Reauthorization Harkin Bill Not a complete re-write – builds on existing ESEA structure More flexibility overall No more AYP/100% proficiency target State-based accountability No substantive changes to funding formulas

113. ESEA Reauthorization Harkin Bill Some support, but also early opposition (not enough accountability, issues with teacher evaluation) Groups opposed include ACLU, La Raza, NAACP, Ed Trust, Chamber of Commerce, Congressional Tri-Caucus

114. ESEA Reauthorization Not a priority for Senate leadership Lack of strong bipartisan support Senator Rand Paul (R-KY) almost derailed markup with procedural objection Senator Lamar Alexander (R-TN) only voted for it in Committee to keep it moving Harkin says he won’t move to place on Senate floor unless House passes their own bipartisan bill

115. ESEA Reauthorization House GOP Bills Setting New Priorities in Education Spending Act (H.R. 1891) Eliminates/consolidates some federal education programs Passed through Committee Empowering Parents through Quality Charter Schools Act (H.R. 2218) Promotes expansion and replication of successful charter models Passed House with bipartisan support

116. ESEA Reauthorization House GOP Bills State and Local Funding Flexibility Act (H.R. 2445) Passed through Committee Creates essentially unlimited transferability Unlikely to become law Groups in Opposition: Center for American Progress, Education Trust, La Raza, NEA, AFT, Special Ed Groups

117. ESEA Reauthorization Failure to move legislation on both sides of the Capitol Not a priority for leadership Lack of strong bipartisan support Encroachment of partisan politics in new issue areas including education “We’ve never had education dragged into this vortex. Education has always been above it.  Now we find ourselves sitting in a partisan firefight.” (Rep. George Miller (D-CA) at CCSSO, March 2012)

118. ESEA Reauthorization Consensus in Washington that ESEA will not go through this year Chances in 2013 depend on political make up of Congress and the White House. If either party controls both branches, ESEA is likely If divided, will depend on how many moderates remain in Congress.

119. Questions???

120. Brustein & Manasevit, PLLC Fall Forum Federal Education Grants Management Conference November 29th-30th Cosmopolitan Hotel Clark County Nevada Registration opens late Summer 2012 Please visit www.bruman.com for more details.

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