On Wednesday, Senator Tom Harkin (D-IA) sponsored and introduced legislation that would create a $23 billion education jobs fund, modeled after the State Fiscal Stabilization Fund (SFSF) that was established in the American Recovery and Reinvestment Act (ARRA).
The Keep Our Educators Working Act would be awarded to local educational agencies and public institutions of higher education for the support of early childhood, elementary, secondary, and post-secondary education. Funds would be used for compensation and benefits and other expenses necessary to retain existing employees, hiring new employees and on-the-job training activities for education-related careers.
The Act is introduced at time when many policymakers and education leaders are increasingly concerned about the upcoming 2011 fiscal year with regards to the steep drop in available funds once the billions of federal dollars made available over the last biennium run out.
Under the proposed legislation, the hope is that the extension of federal assistance to higher education and education will ward off budget cuts and tuition increases. The Act would provide each state’s governor with a formula-driven share of the $23 billion with which to replace any money that they have cut or will cut from their 2010 and 2011 budgets for elementary/secondary schools and public colleges and universities.
The intent is that each Governor will distribute the funds proportionally based on the amounts cut from the two sectors, but can “adjust” the amounts by up to 10 percent of the larger of the two totals. In addition, the money can only be used for “compensation and benefits and other expenses necessary to retain existing employees” or hire new ones, or for “on-the-job training activities” for “education-related careers”. The money could not be used to supplant state funds in a way that restores or supplements “rainy day” funds or pays of debt.
Finally, the legislation would require states to sustain a level of education spending comparable to what they spent in 2006. Specifically, the bill requires governors to spend on both higher education and K-12 at least a comparable portion of their states’ revenues in 2010 as they spent in 2006, and a comparable portion in 2011 as they spent in 2009.
The bill has been deemed “emergency” legislation, allowing the money to come out of federal mandatory rather than annually appropriated funds. This means that the costs of the bill would not have to be offset by cuts in other programs.
While education and higher education leaders are thankful for the investment, it is unclear how much benefit institutions may derive form the legislation if passed because the bill only replaces funds that have been or will be cut from the public college budgets. It also raises questions regarding the role of the state in supporting and investing in their own public education institutions.
The $23 billion request proposed in Harkin’s Keep our Educators Working Act of 2010 has also been introduced in the U.S. House as a part of a freestanding jobs bill Local Jobs for Americans Act (H.R. 4812).