President Obama signed the American Recovery and Reinvestment Act of 2009 (Act) on February 17, 2009, providing more than $100 billion in education funds for early learning programs, K-12 and post-secondary education. The three main components of the Act's education spending programs are the State Fiscal Stabilization Fund (SFSF); Title I, Part A of the Elementary and Secondary Education Act (Title I); and the Individuals with Disabilities Education Act (IDEA), Part B. Each component will be examined individually to show how the education funds will be spent and how these funds will impact Pennsylvania.

The funds under the SFSF, Title I and IDEA components will be available to each state by the U.S. Department of Education in two stages. The U.S. Department of Education will use a formula to determine the amount of funding for each state. Before the end of March 2009, the U.S. Department of Education will release approximately 50 percent of the Title I and IDEA funds. As for the SFSF funds, the governors of each state must complete and submit applications to the U.S. Department of Education by the end of March 2009 to obtain 67 percent of the SFSF available to states. These funds will then be released to the states within two weeks after receipt of an approvable application. The U.S. Department of Education expects to make the remainder of the funds available to states during the time frame of July 1, 2009, to September 1, 2009, with the condition that states provide the federal government with some additional information.

$48.6 BILLION FOR THE STATE FISCAL STABILIZATION FUND

  • $39.8 billion will be used for public early learning, K-12 and higher education.The state must determine a formula to ensure a proper distribution from the state to local education agencies. The state must also determine a mechanism to distribute the funds to higher education institutions.
  • $8.8 billion to governors for education (including school modernization), public safety or other government services.

$1.9 BILLION FOR THE PENNSYLVANIA STATE FISCAL STABILIZATION FUND

  • Half of these funds will be spent in 2009-2010, and the remaining half will be spent in 2010-2011.
  • According to the Pennsylvania Recovery website, of the $953 million that will be allocated in 2009-2010:
    • $42 million will restore planned budget cuts to the four state-related universities
    • $418 million will fully fund the second year of Pennsylvania's school funding formula
    • $319 million will be allocated to school districts for other academic investments, keeping property taxes as low as possible during the economic crisis
    • $173 million will support other government services.

$10 BILLION FOR TITLE I, PART A OF THE ELEMENTARY AND SECONDARY EDUCATION ACT

  • This money will be delivered from the U.S. Department of Education to state educational agencies.

$399 MILLION FOR PENNSYLVANIA FOR TITLE I, PART A OF THE ELEMENTARY AND SECONDARY EDUCATION ACT

  • These funds will be available for disbursement from Spring 2009 until September 30, 2011.
  • The purpose of these funds is to improve reading and math instruction in high-poverty schools.

$11.7 BILLION FOR PART B OF THE INDIVIDUALS WITH DISABILITIES EDUCATION ACT

  • This money will be delivered from the U.S. Department of Education to state educational agencies.

$456 MILLION FOR PENNSYLVANIA FOR PART B OF THE INDIVIDUALS WITH DISABILITIES EDUCATION ACT

  • These funds will be available for disbursement from Spring 2009 until September 30, 2011.
  • The purpose of these funds is to provide special education programs and services to students with disabilities.

$17.3 BILLION FOR PELL GRANTS AND WORK STUDY PROGRAMS

  • These funds will be available for disbursement on July 1, 2009, to be used for the school year 2009-2010.
  • $17.1 billion will be used for Pell Grants to increase the maximum Pell award for all eligible students from $4,850 to $5,350.
  • $200 million will be distributed to work study programs.

ADDITIONAL FUNDS

  • At least 50 percent of the funds for these programs will be available by the end of March 2009 pending the issuance of guidelines:
    • $500 million for IDEA, Part C
    • $540 million for Vocational Rehabilitation State Grants.
  • The following programs will be distributed by a combination of formula and competitive grants. The formula funds will be available by the end of March 2009 and the competitive grants will be distributed at a later date:
    • $100 million will support Impact Aid Construction (40 percent will be distributed by formula, and 60 percent will be distributed by competitive grants)
    • $140 million will support Independent Living Services ($52.5 million will be distributed by formula, and $87.5 million will be distributed by competitive grants)
    • $70 million will support Education for Homeless Youth.
  • These funds will be made available in the beginning of fall 2009. The U.S. Department of Education will release future guidance to obtain these funds through the following programs:
    • $3 billion will support Title I School Improvement Grants
    • $650 million will support Educational Technology State Grants.
  • These funds will be made available in the beginning of fall 2009. The distribution of these funds will be based on the quality of the applications submitted through a competitive grant process. The U.S. Department of Education will shortly release guidelines to obtain these funds through the following programs:
    • $200 million will support Teacher Incentive Fund
    • $100 million will support Teacher Quality Enhancement
    • $250 million will support Statewide Data Systems.
  • Certain funds have been set aside for use by the Secretary of Education to make the following competitive grants:
    • $4.35 billion will be used for a national competition among states for a state incentive "Race to the Top" fund to improve education quality and school results statewide (these funds will be made in two rounds – fall 2009 and spring 2010)
    • $650 million will be set aside in the "Invest in WhatWorks and Innovation" fund and be available through a competition involving school districts and nonprofits groups with strong track records of results.

To ensure transparency and accountability in the distribution of these funds, the federal government, federal government agencies and numerous state governments have established websites dedicated to providing guidelines for obtaining funds through the Act and to explaining how the funds will be distributed. The federal government's website is www.recovery.gov; the U.S. Department of Education's website is www.ed.gov; and the Pennsylvania Recovery website is www.recovery.pa.org. These websites offer critical information on how school districts, colleges and universities may obtain funding from the Act.

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