Federal Relations

April 15, 2010

Senator Harkin Introduces Education Jobs Fund Bill, Senator Murray a Co-Sponsor

**Updated 4/16/10**

Yesteday Senator Tom Harkin (D-Iowa), chairman of the Senate Health, Education, Labor and Pensions Committee and of the Senate appropriations panel that oversees education funding, introduced a bill that would provide $23 billion for an Education Jobs Fund. The Education Jobs Fund is modeled after the State Fiscal Stabilization Fund (SFSF) portion of the 2009 Recovery Act, equaling almost half the SFSF total and allocated in much the same manner. The new fund is intended to further restore K-12 and higher education state budget reductions in Fiscal Years 2010 and 2011 to prevent additional layoffs as SFSF funds dry up with no state funds to replace them (the so called ‘funding cliff’).  Harkin’s bill is very similar to the Education Jobs Fund contained in the ‘Jobs for Main street Act of 2010’ passed by a narrow margin in the House in December. It is not yet known how much support this bill may have in the Senate. As we await further information and analysis, please find initial thoughts on the bill as it may pertain to Washington State and the UW below.

Funding for Washington State
Initial calculations made by the Congressional Research Service indicate that $478.3 million would be granted to the Governor of the State of Washington to retain or create educational jobs.

  • 95% would be distributed to local educational agencies and public institutions of higher education.
  • 5% could be retained by the state for administrative costs and to support education related state jobs.

It is estimated that this legislation would create or save 1,058 higher education jobs and 5,467 K-12 jobs in the state of Washington.

Distribution of Funds
Funds received under this Act must be used to help restore state education funding for FY 2010 to FY 2009 levels (excluding capital funding, state research funding, or tuition and fee revenue), and to help restore FY 2011 state funding to FY 2010 levels (after the application of SFSF and Education Jobs Fund dollars). In the case of insufficient funds to reach these goals, the Governor shall distribute funds in proportion to the relative reduction in state funding for each sector (K-12 and Higher Education), plus or minus 10% at the Governor’s discretion. Any excess funds shall be awarded to local educational agencies based on their relative budget share.

Use of Funds
Funds provided by this bill must be used to retain or create education jobs, going toward compensation and benefits and other expenses required to retain existing employees or hire new employees, OR to provide on-the-job training activities for education related careers (as defined in section 101(31) of the Workforce Investment Act of 1998). The funds may not be used to restore or supplement a reserve or rainy day fund or to supplant state funds for such an end. Nor may funds be used to reduce or retire debt incurred by the State or to supplant state funds toward such an end.

Maintenance of Effort
To qualify for funds under this act, a state must assure the Secretary of Education that it will continue to meet the MOE requirements laid out in the SFSF provision of the Recovery Act (establishing FY 2006 K-12 and Higher Education state funding levels as a ‘floor’), OR provide each education sector a total state budget share in FY 2010 that is equal to FY 2006, and, for FY 2011, a budget share equal to FY 2009.

Arne Duncan, Secretary of Education, expressed strong support for the Harkin bill during a hearing on April 14th. Additionally, Senator Majority Leader Harry Reid has agreed to bring the legislation to the floor. However, a timetable has not been revealed and it remains unclear whether or not the legislation will garner any Republican support. Senator Patty Murray is a co-sponsor of the Harkin bill.

Courtesy of Jessica Thompson

Senate HELP Committee Statement

Text of Legislation