Tuesday, July 14, 2015

ESEA Reauthorization: Reconcilling the House and Senate, Limiting Waivers, and Altering Funding

Last week, I closed with a post noting how close we are to the finish line of reauthorizing the Elementary and Secondary Education Act (ESEA), but reserved any substantive commentary on the potential legislation.  It is hard to speculate on what a final bill passed by both Houses will look like. But right now, the House and Senate bills are substantially different.  This weekend at a conference, I asked Congressman Bobby Scott what we might expect out of the reconciliation process between the House and Senate. He said that the President has made it clear that no bill is better than a bad bill, which Scott believes will offer Democrats more leverage during the reconciliation process.  

From the President's perspective, no bill may even be better than a decent bill because his Secretary of Education has, in effect, already rewritten the ESEA.  In 2012, he began waiving states' requirements under the existing version of the ESEA and replacing those requirements with a new set of policies.  He did this through a conditional waiver process, which 45 states are currently operating under.  In other words, there is the existing ESEA as written into law and the de facto ESEA as imposed through the administrative process.  Those two things are entirely different in substance.  Any legislative amendment to the written ESEA will also wipe out the de facto administrative ESEA.  Knowing that there is policy upside to leaving the existing ESEA in place for the President means there may be even more leverage than Congressman Scott suggested.

The waiver issue also takes us to the substance of current bills in the House and Senate.  The Senate Bill, in particular, is dead set on limiting the Secretary's waiver authority.  Secretary Duncan was able to impose conditions on waivers because the statutory language on waivers was so sparse in the current statute.  It simply said that states can apply for waivers and the Secretary can grant them so long as the waiver applications set goals that will improve education.  As I demonstrate here in Federalizing Education by Waiver?, the Secretary exceeded his statutory authority in conditioning those waivers and probably violated the constitutional as well.  This point is now the subject of litigation in the federal district court in Louisiana.

The solution in the current Senate bill is to take the opposite approach to waiver power.  Rather than a general waiver power, the current bill has various small waiver powers.  Some sections of the bill do not include a power to waive the relevant provisions.  In other words, the provisions cannot be waived.  Other areas of the bill do have waiver provisions, but they only apply to that section and have their own particular standards.  Also, while there is no general waiver authority, there is a general waiver restriction that prohibits the Secretary from imposing things such as the Common Core and its associated tests.  Whether shrinking the Secretary's power is a good thing is not clear yet.  My analysis in Federalizing Education By Waiver? was not a judgment as the substantive merit of the policies embodied in the Secretary's waiver conditions, but simply an analysis of whether he had such authority and whether granting wide waiver authority is permissible or wise.  

Without attempting to identify the optimum level of waiver power the Secretary should have, the current reaction in the Senate bill is probably an over-reaction.  The Secretary should not have the authority to effectively rewrite the ESEA.  Even if granted to the Secretary, such a power would most likely be an unconstitutional delegation of authority.  But it also a mistake to tie the Secretary's hands at all turns.  The entire point of a waiver power is to deal with unexpected events, including catastrophes and innovations.  The current Senate bill may not allow the next Secretary to sufficiently deal with either.

The most significant potential alteration to ESEA, however, may be the funding formula.  As I demonstrate here, the funding formulas in ESEA are entirely irrational.  The formulas allocate funds to states and districts based on factors that do not reflect student need, local costs, and equitable funding goals.  As many others have remarked, the primary effect--if there is one--of the formulas is to reward rich states for being rich and punish the poor for being poor.  This is not Congress's intent. It is just how things have shaken out.  

The problem is that any changes to the formulas, even if they make perfect sense, will produce winners and losers.  Losers do not care about what makes sense.  Illinois would be one of the losers. Senator Durbin has said he will vote against changes that produces cuts for Illinois, not because those cuts are irrational, but because he is against hurting his school districts.  Such a change is not yet in the current bill.  But Senator Burr from North Carolina is introducing such an amendment and is getting a lot of attention.  The only way around the problem of winners and losers is to increase the federal financial stake in education so that we could rework the formula without reducing any state's raw dollar allocation.  No one is seriously discussing that.



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