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Schools retain stimulus dollars even as spending deadline looms

Bracing for economic hardships still to come, savvy school business officers continue to hang on to some of their federal stimulus dollars while eyeing a September deadline when the money must be spent or sent back.

Exactly how much districts are carrying is unclear because federal spending reports focus only on the money that has actually been expended – and not funds that have been obligated in the near future.

Federal stimulus spending reports covering the quarter ending March 30 indicate that statewide districts are still holding as much as $485 million in money from the State Fiscal Stabilization Fund, $300 million in Title I stimulus money and $244 in special education stimulus support.

A check with a handful of school officials suggests that nowhere near that amount is actually sitting idle and at risk of being sent back to Washington D.C.

A number of business officers said that any unspent SFSF dollars – the least restricted money provided under the American Recovery and Reinvestment Act of 2009 – have been earmarked for use in the coming months well ahead of the federal deadline.

Spending the Title I money as well as the funding tied to the Individuals with Disability Education Act appear to be far more problematic because both have restrictions on what the money can be used for.

Still, officials at the California Department of Education want district administrators to be sure they understand that federal stimulus money for the major programs need to be expended by Sept. 30, 2011.

Carol Bingham, director of the CDE’s Fiscal Policy Division, said that the CDE is concerned about a possible reversion of unspent ARRA funds to the federal government and that it will be communicating with the field on the importance of spending these funds before the deadline.

With many schools looking at the end of session just weeks away, there are growing concerns that some districts may not have the time to spend big chunks of money and no payroll to meet until next fall.

Districts are being urged to get their paperwork submitted to the CDE before the end of the fiscal year to ensure prompt apportionment.

Congress provided more than $700 billion to states in direct grants and tax breaks intended to serve as economic stimulus beginning in 2009. California’s public schools, colleges and universities received about $14 billion.

The largest program for K-12 was the $3.1 billion provided through the SFSF. Expenditure reports through March 30 show that 85 percent of those dollars have been spent.

The stimulus act also provided California’s K-12 districts $1 billion in Title I support, of which 73 percent has been spent; and $1.2 billion, which 81 percent has been spent – as of the end of March.

(Ed’s Note: This story appears courtesy of Cabinet Report, a subscription-based education news service published by School Innovations & Advocacy. To learn more visit:http://www.siacabinetreport.com/home.aspx To contact reporter Tom Chorneau use: tomc@sia-us.com)

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