Why it’s so hard for schools to spend all that COVID relief money

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Schools during the pandemic have gotten more federal funding than ever before. At the same time, schools are worried and stressed about money.

Although these statements seem to contradict each other, both are true.

Recent headlines, from CNN and Pro Publica at local and regional outlets, shouted that schools are “sitting” and “wasting” billions of dollars in federal pandemic relief funds. School finance experts worry that districts are not moving fast enough to invest in reducing students’ lost learning time. Lawmakers in several states have suspended education funding because schools are ‘flooded’ in federal cash.

Indeed, the federal government has injected nearly $200 billion in humanitarian aidknown as the Elementary and Secondary School Emergency Relief Fund (ESSER), to K-12 schools in 2020 and 2021. Separately, the Federal Emergency Management Agency is offering to reimburse districts for the cost of masks, personal protective equipment and other COVID mitigation equipment and personnel. State departments of education and state and local governments have secured federal relief funds that can also be spent on K-12 schools.

But accusations that schools are not spending their newfound wealth quickly enough ignore the many obstacles in their way. Some states have been stingy in getting relief funds to districts in a timely manner. The requirements for expenses eligible for funds are complex. Filing paperwork to get reimbursed can be onerous for understaffed district offices. Refunds in some states are coming at a snail’s pace.

Once districts made plans to spend the funds, many positions were difficult to fill. The pandemic and a turbulent economy have exacerbated longstanding shortages skilled workers in education, especially in rural areas. The short-term nature of the grants means that districts cannot guarantee potential employees that they will have jobs after 2024. And some states, like Wisconsin, have cut state aid to K-12 schools, arguing that federal funds should make up the difference despite rampant inflation.

Some districts are trying to put smart investments in place by the funding deadline two and a half years from now, rather than immediately dumping all of their allocations.

“If schools went out and quickly spent on suppliers or resources that are very expensive right now because of the pandemic and the shortage of materials, they would be accused of spending too much money on things that were not needed,” said Erik Edoff, superintendent of L’Anse-Creuse schools in Michigan.

These complications are slowing schools’ extensive efforts to support students academically and emotionally after a public health crisis that is now two years old and not yet over.

Spending restrictions increase districts

A district’s federal relief allocation was determined by the proportion of federal Title I funds it receives each year to serve students in need. While some districts received up to $20,000 per student in federal aid, a handful of districts, including Edoff, received less than $1,000. per student of the three congressional emergency aid programs combined.

In Michigan, state lawmakers offered federal officials a solution for districts that had little: direct some of the relief aid for the state Department of Education to a COVID equalization” which ensures that each school district receives at least $1,093 per student.

But the federal government repeatedly refused that request, Edoff said, until representatives of the Michigan K-12 Alliance, an advocacy organization, interviewed U.S. Secretary of Education Miguel in person. Cardona, and other senior ministry officials about it last fall.

When the federal government finally approved the equalization fund, it attached a series of new regulations that districts would have to follow in spending it. These requirements include ensuring funds are used only for eligible students using Title I aid and documenting the impact of spending on a teacher-by-teacher basis, rather than school-by-school.

The regulations are “more extensive than any funding I’ve ever seen,” Edoff said.

A spokesperson for the US Department of Education did not respond to questions in time for publication.

When the equalization fund was announced, Edoff had hoped to “cover” all students in the district with new teaching materials around the math intervention. Now, “we may have to be more focused,” he said.

Paperwork Piles Up While Funds Lie Unused

Employees of the Des Moines School District Business Office in Iowa have also been swimming in paperwork lately. The district of 31,000 students has submitted seven claims to be reimbursed by FEMA for COVID-related expenses like masks, plastic screens and increased nursing staff.

The level of detail that FEMA staff members expected from the district was extraordinary, said Shashank Aurora, district chief financial officer.

For example, when detailing the district’s purchase of masks, one of Aurora’s staff members had to specify the number of masks for each of the district’s six dozen school buildings. This involved consulting with district supply and warehousing departments and contacting individual school buildings.

FEMA responded to six of the district’s requests, totaling more than half a million dollars. There’s one more left, for about $60,000.

Aurora decided to cover some small expenses with ESSER funds rather than having to go through the FEMA process again.

He also tried to work proactively with emergency management officials to understand what was eligible for reimbursement before submitting claims. He heard from other school affairs officers, in smaller districts with smaller business offices, who submitted requests with lots of items and just hoped for the best.

“Everyone was pulling their hair out,” Aurora said. “People who took the shotgun approach, they had big disappointments.”

Problems with FEMA’s program for schools abound. According to Ray Hart, executive director of the Council for the Great City Schools, the federal government has told districts that certain expenses they previously covered with pandemic relief funds are now eligible for reimbursement from FEMA. But with FEMA taking more than a year to respond to applications, districts may not get their FEMA application approved in time to allocate those pandemic relief dollars to something else before they expire in September 2024.

State and federal emergency management officials don’t always agree on what’s eligible under the COVID Reimbursement Program, Hart said. Refund guidelines have changed at least twice since the start of the pandemic, and some state emergency management agencies have been slow to catch up with the latest guidelines.

Some districts anticipated the chaos and completely ignored FEMA’s offer. Lois Standring, assistant superintendent of business and operations for the Novato District of California, worked with FEMA on wildfire recovery when she previously worked in schools in Sonoma County. The district encountered all kinds of logistical problems navigate agency wildfire recovery policies.

“When the opportunity to work through FEMA for COVID reimbursement came up, I ran the other way,” she said.

Reimbursement of expenses is not an easy task

Congress passes the US bailout, which included the third and largest allocation of COVID-19 relief funds for schools, last March. But Florida neighborhoods and Missouri waited nearly a year for their states to grant them access to their full benefits. And the districts of Arizona and Michigan have endured months of legislative wrangling on whether to use federal relief funds to penalize schools that have remained in remote learning mode to mitigate the spread of COVID-19.

Even after states approve district plans for ESSER investments, the job is not done. Districts in many states must submit purchase invoices to states before they can be reimbursed for ESSER-funded initiatives.

In Maine, some districts had to take out loans to ensure they could continue to pay their employees because the state took months to repay the money the district spent on ESSER-eligible items, a said Eileen King, executive director of the Maine School Superintendents Association.

“Superintendents are very keen on spending the funds, they’ve requested the funds, they have great plans to spend them,” King said. “The problem is really the flow of funds.”

The process for applying for these refunds is fraught with thorns, said Katie Gourley, business manager for Bucksport Schools in Maine. Districts can only have one rebate application open at a time on the state’s online portal. Each set of ESSER funds has a separate form that must be completed.

As a result, Gourley District is even months behind in seeking refunds, which have each taken a month or more to arrive.

A spokesperson for the Maine Department of Education did not respond to questions about the state’s ESSER reimbursement process in time for publication.

Bucksport District Superintendent Jim Boothby echoed the concerns of many district leaders that the public and some policy makers expect more from them than they can provide under current constraints.

“If people don’t understand that these funds can be spent until 2024, they don’t understand the repayment mechanism, and they only look at the dollars spent to date, I don’t think it’s a fair assessment of the value of the money that has been shared and the impact it has,” Boothby said.

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