George Lucas Educational Foundation
Teacher Development

Economic-Stimulus Package Is an Unprecedented Investment in Education

$100 billion is headed to schools.
February 17, 2009

The economic-stimulus bill signed Tuesday by President Obama sends $100 billion to education, money that's designed to restore cuts and reward schools for innovation and reform.

Lots of questions remain, however, about when and how the money will be distributed -- and whether it will be enough to do all it's expected to do. Lawmakers have acknowledged that the money intended to help states fill holes in education funding may not be enough, and school-construction money was stripped from the $787 billion stimulus bill before Congress approved it last week.

Despite the uncertainty, the bill does help Obama make good on promises to help the nation's K-12 schools.

"Because we know America can't outcompete the world tomorrow if our children are being outeducated today, we're making the largest investment in education in our nation's history," the president said in remarks in Denver before signing the legislation.

States Wait for Money

Under the bill, states will get $53.6 billion in what's called the state stabilization fund. Most of that money (about $39 billion) goes toward helping states restore cut programs, which, depending on the state, have included early-childhood education, after-school programs, professional-development money, and actual school staff.

States already have an idea of what they might get in overall education funding, which also includes increases in money for special education, technology, and grants for college, and to help schools where high numbers of poor children are enrolled. For instance, California could get $11.2 billion, New York $6.4 billion, and Georgia $3 billion, according to a breakdown from the National Education Association.

But the stimulus bill is meant to do more than simply fill holes. In what the Obama administration considers its reform piece, there's $5 billion in incentive grants, which U.S. education secretary Arne Duncan calls "race to the top" money. This money won't be available until 2010, after states are able to put their stabilization funds in place. To get a grant, a state has to show how it's in compliance with a few measures under the No Child Left Behind Act already required under the law. They also have to put in place a statewide data system to measure student progress and make sure their standards lead students to college or other postsecondary training.

It's not yet clear how states will prove they're doing everything right, and what they'll do with their incentive money. Duncan says it's intended to make students and schools more competitive globally. Also included in the $5 billion is $650 million for more innovative programs, to "scale up what works" in schools, Duncan adds.

"This is a chance to really improve outcomes," Duncan said of the education money last week.

In Duncan's words, the education money presents a historic opportunity to improve K-12 schools. But some worry that reform was not the goal of the stimulus. Jeanne Allen, of the Center for Education Reform, says the package "misses the mark by a wide margin."

"Student achievement, the purpose of our nation's schools, is not an explicit or implicit requirement of the new stimulus spending for education," Allen said in a statement.

The Consortium for School Networking and the International Society for Technology Education also said it was disappointed in the amount of money available to boost education technology.

The Line Items

Among the K-12 education money in the stimulus package:

  • $2.1 billion for Early Head Start and Head Start, the early-childhood programs for low-income children ages 0-5. It's estimated this funding will affect about 124,000 infants and preschool children.
  • $13 billion for Title I, the program that aids schools with a high number of low-income students to help fund extra programs.
  • $12.2 billion for IDEA, a program for special education grants.
  • $8.8 billion as part of a state stabilization fund that states can use for education, including infrastructure fixes. In addition, state and local governments can issue up to $22 billion in school-construction bonds over two years.
  • $650 million for education-technology grants, for things like classroom computers and curricula that use technology.
  • $200 million for the Teacher Incentive Fund, which supports programs for teacher performance pay.
Alexandra R. Moses is a freelance writer in the Washington, DC, area who specializes in education.

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