Here's why analysts say schools aren't spending more of their $200 billion COVID stimulus
WASHINGTON (TND) — President Joe Biden is getting impatient with schools that are supposedly not moving fast enough to spend stimulus money they got from COVID-19 relief bills, but some analysts say there are good reasons why most of that money has not yet been spent.
Congress flooded schools with billions of dollars over the course of the pandemic, with each spending package larger than the last. All told, over the past two years, Congress allotted almost $200 billion to K-12 schools in three separate bills to keep them up from falling too far behind during lockdowns.
The first bill came in March 2020 with the Elementary and Secondary School Emergency Relief (ESSER I), which provided $13.2 billion in funds to K-12 schools. That was followed by ESSER II and ESSER III in December 2020 and March 2021, respectively.
ESSER II provided an additional $54.3 billion to schools, while ESSER represented the biggest cash infusion at $122 billion. Most of the money from the third tranche has not been spent.
Biden — who signed the provision allocating ESSER III — is now wondering why schools are not using all that cash to reopen schools.
You know, they have what they need," the president said of schools during a White House COVID response team meeting last week. "The states and the school districts have spent this money well, many of them. But unfortunately, some haven't.
There's a good reason why some schools have not gotten around to spending some of the allotted money, according to Nat Malkus, a senior fellow and deputy director of education policy at the American Enterprise Institute.
School districts are likely having trouble finding ways to spend the money, given that all that cash is temporary and will need to be spent before a certain date, Malkus noted in an analysis of the ESSERs he conducted back in October.
"If early indicators mentioned earlier hold, many districts will use ESSER funding to hire more staff—both teaching and nonteaching—or to pay for existing programs in ways that can do harm down the road when ESSER funds are finally spent," according to the report.
If getting schools back in session and away from virtual learning is the most important aspect, Malkus argues, then the pandemic is still likely causing problems in terms of enticing teachers to rush back into the classrooms.
"It's pretty hard to find substitutes right now even if you wanted to pay more substitutes. It's hard to find things we would need to spend it on — things like tutoring and after-school programs," Malkus told The National Desk. "People are not interested in those things right now."
Money from ESSER I and ESSER II contained almost no restrictions, while the third installment included one major condition: 20% of the money must get used for addressing learning loss. The other 80% of funds can be used however way school districts deep appropriate.
Requirements "were so loose you could drive a truck through," Malkus said, noting that most schools were all over the place in terms of their priorities. But, ultimately, "they are going to spend this money, for good or ill," he added.
Another analysis conducted in November traced how thousands of school districts across the country are spending some of the cash from ESSER III.
More than 1,000 districts in 35 states received over $29 billion combined, almost a quarter of the national allocation, according to data compiled by Burbio, which tracks shutdowns during the heat of the pandemic.
Burbio discovered that more than half of school districts have earmarked funds for summer learning, while a third are using it to pay for transportation, and nearly a quarter plan to invest in online platforms. Staffing needs, summer learning programs and air filtration improvements like HVAC systems were the most popular uses, according to Burbio. About 40% of the 1,040 districts the group looked at planned to spend in those categories.
Still, analysts echo much of Malkus' concerns.
“Most of it is being used for the right things and in the right areas, the problem is understanding the impact of taking away a service once you’ve provided it,” Ralph Martire, executive director of the Center for Tax and Budget Accountability, told Bloomberg in November.
School districts should be very persnickety about utilizing funds to cover recurring costs,” Martire added.
Biden and everyone else should keep in mind that school districts are still navigating how to spend funds from ESSER III, according to Malkus.
"I think there is a consensus out there that some of the spending is just not going to be COVID specific. In large part, because they have a short amount of time to spend the money," Malkus said.
He added: "If you spend it all on more teachers and more staff, you'll have to fire everybody in four years."
