Sunday, October 24, 2021

Where Did the Billions in Federal COVID-19 Funds to Schools Go?

In prior scholarship, I have addressed how the specific metrics used in the impact investing sector may be used to measure and report social good in the charitable sector to increase transparency and accountability about how donated funds are used.  The issue of incomplete reporting in the nonprofit sector is highlighted in a recent ProPublica article about the shortcomings of reports by state school districts on how they have used federal aid funds disbursed to remedy educational fallout from the pandemic.  Specifically, the ProPublica article addresses the gap between federal governmental aid to schools during the pandemic and measurable results from state school districts.  According to the article, the federal government gave around $190 billion in aid to help schools reopen and to address the effects of the pandemic.  In the year and a half since school doors were closed to millions of children, the Education Department has done only limited tracking to determine how the funds were used.  As a result, Washington, D.C. is in the dark about the effectiveness of the aid, especially in terms of those communities that have struggled the most during the pandemic.  

State education agencies were required to submit provisional annual reports to the federal government.  However, their reports only utilized six very broad categories, including technology and sanitation, to disclose how funds were used.  ProPublica analyzed more than 16,000 of such reports for the period March 2020 to September 2020 and found that billions of dollars were categorized as funding “Other.”  For example, some of the largest school districts in the country categorized all of their aid under the “Other” category, including Los Angeles Unified, which spent $49.5 million, and New York City’s schools, which spent $111.5 million.

ProPublica points out that since there is not a centralized and detailed federal tracking system, monitoring of how the relief funds given to over 13,000 school districts has been up to individual states.  Some school districts have expended the funds in a way that it is not at all consistent with the federal aid program, such as by using the funds for track and field facilities and bleachers.  The article cited both a school district in Iowa (Creston Community School District) and one in Pulaski County, Kentucky as engaging in such spending.

Importantly, the federal aid program delineated at least one very clear goal.  The funds were to be used to re-open schools to maximize in-person learning.  Broadly speaking, the funds were to be used to address the impact of the pandemic.  There have been numerous articles that have detailed the educational and emotional fallout from remote learning.  It is surprising to learn that there have not been directed efforts to help students make a smooth transition back to in-person learning and to recover from any lapses in their educational and/or social, emotional development as a result of the pandemic.  Instead, for example, in Texas, the McAllen Independent School District spent $4 million of its relief funds to build a 5-acre outdoor learning environment associated with a local nature and birding center owned by the city.  Although the concept may be a good one in theory, it fails to address  “the urgent learning needs of children who have been directly impacted by the pandemic.”  Critics have pointed out that the outdoor area will not even be completed before 2024, so half of the children there will not benefit from the outdoor center at all. 

Perhaps it is not too late for school districts to make the right choices in terms of spending federal aid.  Although most of the aid was dispensed from March 2020 to March 2021, the school districts have until 2024 to budget how the funds will be utilized.  Given the federal government has started to request basic information from states about how their school districts have used their funds, hopefully, the school districts will re-calibrate their spending and set forth goals consistent with the overall aim of the relief program. 

Khrista McCarden

Hoffman Fuller Associate Professor of Tax Law, Tulane Law School

https://lawprofessors.typepad.com/nonprofit/2021/10/where-did-the-billions-in-federal-covid-19-funds-to-schools-go.html

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