Feds prepare to give school stimulus money to states

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Federal dollars are about to start raining down on Utah schools.

U.S. Secretary of Education Arne Duncan announced Wednesday that $44 billion in stimulus money is now available to states and schools. Of that money, $32.6 billion is "stabilization" money to help states fill holes in education and other budgets. The other $11.4 billion is intended mostly to help schools serving poor students and students with disabilities.

The federal government will release a second round of stabilization money -- an additional $16 billion -- later this year with more stringent requirements than the first round, Duncan said. Another $5 billion in "Race to the Top" money will later be awarded to states that most aggressively pursue education reforms. More money for schools serving poor students and students with disabilities will also be released later this year.

In all, Utah schools are set to grab more than half a billion dollars in education stimulus money over two years.

Duncan said states were free to start applying for the first round of stabilization money Wednesday; they could get the money within two weeks of application approval.

"Given our economic circumstances, it's critical that money go out quickly but it's even more important that it be spent wisely," Duncan said.

Todd Hauber, Utah associate superintendent, said this first round of money will be a big help. Utah lawmakers decided this past legislative session to use about $298 million in stabilization money to plug education budget holes.

That temporary fix, however, will still mean about a 5.2 percent cut to education in Utah for next school year.

Districts are preparing to deal with that cut in different ways. The Weber School District is delaying purchases of land, buses and textbooks; teachers will lose a day-and-a-half in paid planning time; and health insurance increases will likely be picked up by employees, said district spokesman Nate Taggart. Alpine School District is cutting 29 full-time administrative positions through attrition and reshuffling, scaling back a program that puts teaching assistants into classrooms, and slashing the district's supplies budget by 10 percent, said Rhonda Bromley, district spokeswoman.

For the most part, Utah districts are still trying to figure out exactly how they will be able to spend the stimulus money, but McKell Withers, Salt Lake City School District superintendent, said it will be "a welcome increase."

Withers said the money could be used in Salt Lake to build up after-school and literacy programs and preschool or kindergarten offerings.

Other districts are still deliberating.

"Everything is on the table, but nothing is on the chopping block," said Patrick Ogden, Park City School District communications and budget officer.

Clayton Holt, San Juan School District budget officer, said his district is awaiting further guidance.

"We haven't received information on what strings are attached," Holt said.

Duncan gave states a peek at what those strings will look like on Wednesday.

In order to get stabilization money, states will have to commit to meeting a number of goals, Duncan said. They will have to work toward improving teacher effectiveness and ensuring all schools have highly qualified teachers; making progress toward college and career-readiness; improving achievement in low-performing schools; and improving data systems.

To get the second round of stabilization money, states will likely have to report, in detail, how they are meeting the goals, many of which touch on policy points near and dear to President Barack Obama. For example, states will likely have to report the number of districts that use student performance to evaluate teachers. They will also likely have to report the numbers and percentages of students who graduate from each high school and then complete at least one year of college within two years.

States will also likely have to report whether they cap the number of charter schools, how many charter schools they have and how many have been closed for academic reasons.

Obama recently cited all three issues -- performance pay for teachers, high school dropouts and charter school growth -- among his education reform priorities.

Hauber said the guidelines give Utah a clearer picture of what the feds expect states to do with the money.

"It's kind of a double-edged sword," Hauber said. "You get the money and you can take care of stabilizing education but if you want the rest of the money, you want to align yourselves with those priorities coming from the administration."

A governmentwide Recovery Accountability and Transparency Board will oversee how stimulus money is spent to guard against fraud, waste and abuse. Duncan said Wednesday that he will hold back second-round money from states that act in "bad faith" or play "shell games" with the first round of money.