Federal Education Policy Update

1. Federal Education Policy Update May 1, 2018 PAFPC Leslie Finnan Senior Legislative Analyst, AASA: The School Superintendents Association

2. Overview • Funding • Taxes • Higher Education • Vouchers • DACA • Other Issues • Questions

3. FUNDING

4. FY17 Funding Package • $68.2 b for USED at base level, but when we account or $1.3 b rescission to Pell, the level is $66.9($1.1 below FY16) • ESSA • Title I increased by $550 m ($450m from SIG), still short at LEA level • Title II cut by $294m (13%) to $2.1 billion • Title IV funded at $400 m (revert to competitive?) • Other • IDEA receives $90 m increase (still at just 16% of federal share) • Impact Aid up $23m to $1.3b • 21st Century up $25 m • Charter Schools up $9m • Head Start up $85 m • Includes reauth of DC voucher program

5. FY18 trump Budget Proposal • FY18 Priority: Very real deep cuts. • Parity between defense/non-defense discretionary • $54b increase for defense discretionary; paid for with $54 b cut to NDD • $9 b (13%) cut to USED • $1.4 b increase for school choice/privatization • $1b for Title I portability; $250 m for vouchers; $168 m for charters • Cuts IDEA and Title I local allocations, as well as Carl D Perkins (Career/Tech) • Eliminates Title IIA, Title IV and 21st Century Community Learning grants • Eliminate 20 other categorical grants

6. FINAL FY18 DEAL • Final budget deal raised caps ($80 b for DD, $63 b for NDD) • $1.3 trillion, with $579 for NDD overall • $3.9 b increase to USED (to $70.9 b) • If USED FY12 allocation ($68.1 b) kept pace with inflation, it would be $74.8 b in 2018 constant dollars • Rejects new choice proposals (does fund DC vouchers) • Head Start up $610m • ESSA Title I up $300 m, Title II level funded, Title IV up $700 m to $1b • $275 m increase for IDEA state grants • $75 m increase for Perkins • $3 b increase for programs to respond to opioid crisis • Impact Aid increase of $86 m • First year of funding for SRS since 2015

7. Rescission Threats • Because of a little-known law, President Trump can rescind specific elements of the funding bill he signed (with Congressional approval) • The Administration will likely release a $60 billion rescission package in the next few weeks • Likely to include significant education cuts • Not likely to pass the Senate • McConnell has expressed concern

8. FY19 Budget Proposal • President released his FY19 budget proposal on Feb 12 • $63.2 b to USED, a cut of $3.6 b/5%) • Continues prioritization of privatization • Budget proposal was modified to reflect cap increases, but those additional dollars went largely to doubling the amount available for choice (from $500 m to $1 b) • Eliminates: Title II, Title IV, 21st Century, Teacher Incentive Grants, Comprehensive Lit Grants, Forest Counties • Cuts: Impact Aid, Medicaid, SNAP • Freezes Title I, nominal increase to IDEA, freeze REAP, small increase to Perkins, cut to program that would support opioid abuse prevention

9. Tax reform – why we care • SALT-D – reduction of the state and local tax deduction • This could tie the hands of districts to raise local taxes, because that money would be double-taxed by the local district and the federal government • Would most definitely lead to lower education spending at the local level – especially in a high-tax state like New York • Vouchers – expansion of 529 plans • Expands 529 college savings plans to be used for K-12 private schools as well • Most state tax legislation echoes federal legislation, so this would expand state 529s as well • Qualified Zone Academy Bond (QZABs) • Repeals tax-exempt status for bonds, thus increasing the interest rates available to school districts and the long-term costs • $1.5 trillion added to deficit • Will pressure Congress to make cuts elsewhere, may trigger more across-the-board sequester cuts

10. Federal Student Loan Forgiveness/Grant Programs • Public Service Loan Forgiveness • If a teacher makes 10 years of on-time income-based payments, the remainder of the loans are forgiven • Teacher Loan Forgiveness • If a teacher works in a low-income school for five years, he/she can have up to $17,500 (math, science, or special education) or $5,000 forgiven • Perkins Loan Cancellation • Forgives federal Perkins loans for teachers for each year spent teaching at a low-income school or ESA or a high-needs subject area • TEACH Grants • Up to $4,000 per year given to college students who have an expressed interest in teaching in a low-income school. The graduate must teach at least four of the eight years following graduation in a low-income school or ESA

11. Higher Education Act Reauthorization, House • The House committee passed partisan (GOP) bill – the PROSPER Act • Eliminates all of Title II – teacher preparation programs • Eliminates TEACH Grants • Eliminates public service loan forgiveness • Creates “one loan, one work-study, two repayment plans” framework • Teachers would have the same options as every other graduate • Looking for time on the floor – Chairwoman Foxx actively whipping votes

12. Higher Education Act Reauthorization, Senate • Senator Alexander was insistent on a bipartisan, comprehensive bill • Has not released anything beyond rumors • His priorities are FAFSA simplification, repealing Obama-era regulations • Senator Murray is too concerned about ESSA implementation to pursue a comprehensive reauthorization • Her priorities are affordability and accountability • What’s next? • Partisan (GOP) bill may be released, dead on arrival • Smaller bills may be released, probably also dead on arrival

13. Impact Aid Voucher Proposal • What is happening? • Republicans recently introduced the Military Education Savings Accounts Act (HR 5199 / S. 2517) • Creates a private school voucher program for students with an active-duty parent in the military • Will likely be attached to National Defense Authorization Act in the next few weeks • The program will drain dollars from the Impact Aid program. Instead, a few military-connected students will be eligible for a $2500 voucher that they can use at a private school, online school, summer camp, afterschool programs or for homeschooling. • Impact Aid school districts could lose up to $450 million dollars or 39% of the total funding for the program • What can we do? • Contact your Members of Congress now! • http://www.aasa.org/legislative-action-center/#/

14. DACA • President Trump ended the DACA program • Gave Congress six months to come up with an alternative – they didn’t • Impacts about 250,000 students • AASA opposes this change • Resources posted to our blog • http://aasa.org/policy-blogs.aspx?id=40802&blogid=84002 • Advice to schools: • Know your rights – ICE agents are not allowed on school grounds • Do not collect information you do not want to share – especially immigration status of students or parents

15. Where is DACA Now? • In February, in exchange for Senator Flake’s vote on the tax bill, Congress voted on four different immigration bills • They ALL failed • It was suggested that DACA be included in the March appropriations bill • It was not • Courts have ruled that President Trump cannot end the program, so current recipients are in limbo • It is very unlikely anything will happen outside the courts this year

16. Healthcare • Medicaid: • House bill (AHCA) and Senate bills (first BCRA, then Graham-Cassidy) would change the way Medicaid is funded • Would create block grant to states – allowing states to decide which institutions to reimburse • Would also lead to lower funding levels • CHIP: • Provides health insurance for low-income children not covered by Medicaid • Many students on CHIP receive health care in schools as a part of the Medicaid program • Funding expired in October – was finally reauthorized after over 100 unfunded days as part of the shutdown negotiations

17. Perkins CTE • 114th Congress • House passed bipartisan legislation in July 405-5 to reauthorize Perkins, Senate didn’t take action • 115th Congress • In June, the House passed a very similar bill • There is much to like in the bill • Addresses the onerous administrative requirements for Perkins funding • Addresses paperwork burden by allowing districts to fill out a simple, easy-to-complete local application • Streamlines the accountability system and aligns performance measures with those set by each state under ESSA

18. School Nutrition • 114th Congress • House and Senate introduced bills last year, did not make it out of Committee • 115th Congress • Attention in the Senate to be on the Farm Bill instead this year • USDA Actions • Secretary Purdue signed proclamation ordering flexibilities • Essentially status quo • Holding sodium limits at Target I • Allows for waiver of whole grain requirement to 50% • Allows 1% flavored milk to be served • Also recommending some flexibility for hiring, especially in rural areas

19. Farm Bill • Last week, the House Agriculture Committee passed (26-20) a bill to reauthorize the Farm Bill, which includes SNAP (formerly Food Stamps) • The bill increases work requirements for SNAP recipients • Could cause more than 1 million low-income households with about 2 million people to lose their benefits altogether or have them reduced – particularly low-income working families with children • Narrows categorical eligibility – lowering eligibility for SNAP • Directly impacts schools using categorical eligibility to enroll students in lunch and breakfast programs

20. Early Learning • Child care as a Trump (family) priority • Democrats released a comprehensive bill last month • Provides financial incentives to states to beef up their programs for 3 and 4 year-olds in high-quality preschools • Increases workforce training and compensation • Broader support for Head Start • Child care tax credit increased in tax proposal – does not necessarily lead to quality • Goes primarily to higher income households

21. AASA Legislative Agenda • ESSA • School Nutrition • Perkins Career/Tech • IDEA • Rural Education (REAP, Forest Counties, Impact Aid) • School Vouchers • E-Rate/Lifeline/EBS • Student Data & Privacy • Charters • Higher Education Act • Early Education • Affordable Care Act • Regulations: DoL and EPA • Immigration / DACA • More?

22. AASA Policy & Advocacy Team Noelle Ellerson Ngnellerson@aasa.org @noellerson Sasha Pudelskispudelski@aasa.org@spudelski Leslie Finnanlfinnan@aasa.org @LeslieFinnan

23. Questions?