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A STIMULATING DEBATE: Seeking to Reduce the Overall Cost of the Economic Recovery Legislation, Senators Remove Portions of Education Funding

“Education is fundamental to everything we are trying to do.”

On February 10, by a vote of 61 to 37, the Senate approved its version of an $838 billion economic recovery bill, dubbed the American Recovery and Reinvestment Act of 2009. Only three Republicans, Senators Susan Collins (R-ME), Olympia Snowe (R-ME), and Arlen Specter (R-PA) voted for the bill. The next step for the legislation is a House-Senate conference to iron out the differences between the Senate-passed bill and the version that the House of Representatives agreed to in January.

One of the largest differences between the two bills is the significantly greater funding for education in the House version. In total, the House-passed bill would provide more than $140 billion for the U.S. Department of Education, compared to about $80 billion in the Senate bill. Specifically, the Senate cut the $20 billion for school renovation and modernization that was included in the House-passed bill. Also among the cuts were $250 million for Statewide Data Systems, $100 million for Impact Aid, and $200 million for the Teacher Incentive Fund. The Senate bill would provide $12.4 billion for Title I, compared to $13 billion in the House version and $13.8 billion for Pell Grants, compared to $15.6 billion in the House.

The Senate also cut a significant portion of the state stabilization fund, which would provide fiscal relief to states to prevent cuts to education and other priorities. Under the Senate-passed version, states would receive $39 billion, of which $31 billion would go to local school districts and public universities and colleges under existing state and federal formulas and approximately $7 billion would be for incentive grants as a reward for meeting certain education performance measures. The House bill would provide a total of $79 billion for the state stabilization fund, which includes $15 billion as incentive grants, $39 billion through existing state and federal formulas, and $25 billion to states for other high-priority needs which may include education.

Prior to the Senate vote, House Speaker Nancy Pelosi (D-CA) went on record as being against the cuts to education. “Education is fundamental to everything we are trying to do,” she said. “These cuts are very dangerous. The House package was put together very carefully. I am very much opposed to the cuts proposed in the Senate.”

In a speech in Elkhart, Indiana on February 9, President Obama detailed why it was important to keep education funding in the American Recovery and Reinvestment Act of 2009. “But what we should be looking for is how do we encourage high-wage, high-value work,” Obama said. “And there the key is going to be how well we are training our work force. That’s why in this recovery and reinvestment package, we put billions of dollars not only to make sure that school districts who are getting hammered are able to keep their teachers, but also we have money in the package to make sure that we are retraining our teachers around math and science, so that they are able to provide our young people what they need to compete in this new global economy…”

The president acknowledged that the Senate cut many of the education dollars that he mentioned, but added that he “would like to see some of it restored.”

It is too early to tell whether the education dollars can be restored in a House-Senate conference. Already, Senator Specter has said that he would support the conference report only if it comes back “virtually intact, including, but not limited to, overall spending, the current ratio of tax cuts to spending, and the $110 billion in cuts.” Without Specter’s support, Senate Democrats would need to hold the support of Senators Collins and Snowe to reach the sixty votes required for passage.

President Obama hopes to sign the final bill into law before Presidents’ Day, but House Majority Whip Steny Hoyer (D-MD) said prior to the Senate vote that the House-Senate conference could stretch well past the holiday and into next week.

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