Home AdvocacyPolicyWashington Notes2003 Jun

• Budget Update
• Appropriations Update
• HEA Update
• E-Rate Update
• National Ed-Tech Plan

Budget Update
President Signs Tax Cut

Late last month, after prolonged negotiations between the House and the Senate, the President signed into law a tax cut of $350 billion over ten years. The measure provides $330 billion in tax cuts, including lowering taxes on capital gains and dividends, lowering rates for taxpayers at all income levels, and tax credits for parents with children. Additionally, the legislation provided $10 billion for state Medicaid relief and $10 billion for temporary state fiscal relief, $5 billion in FY03 and $5 billion in FY04. States may use the fiscal relief funds to provide essential government services and cover the costs to the state of complying with unfunded federal intergovernmental mandates such as the American with Disabilities Act or the Family Medical Leave Act. The states will receive their allocations based on their relative population.

Although this tax cut is still large by any standard, it is considerably less than the Administration’s proposal for $728 billion in tax cuts and the House’s approval of a $550 billion tax cut package. The reduction in the overall figure, as well as the inclusion of direct state aid, is mostly attributable to the insistence of two Republican Senators, Olympia Snowe (R-ME) and George Voinovich (R-OH), that they would block any tax cut over $350 billion. They objected to higher tax cut figures on the grounds that any tax cut over $350 billion was inappropriate when the country was continuing to pay the costs of the Iraq war and was still suffering economic difficulties. The result of their refusal to agree to greater tax cuts may mean that more money will be available for domestic discretionary spending programs, such as education, than if Congress had approved the larger tax cuts.

Appropriations Update
Congressional Leaders and the White House to Meet to Discuss Spending Levels

Congressional leaders, appropriators and the White House are scheduled to meet this week to hammer out an agreement about each agency’s spending levels for FY04. To date, Congressional Appropriators have not moved any appropriations bills over concerns that the $784.7 billion FY04 budget does not provide sufficient funds to many domestic programs, especially for education programs. Until the Appropriators are given their 302(b) allocations, the total amount of spending for each subcommittee, action cannot begin on passing the 13 Appropriations bills.

For the last few weeks, Speaker of the House Dennis Hastert (R-IL) and Senate Majority Leader Bill Frist (R-TN) have worked with the leaders of the Appropriations Committee to reach a compromise on the Appropriations logjam. Just recently, they reached an agreement to increase funds available for FY04 by diverting $3 billion in FY03 defense funding and recrediting up to $2.2 billion in advanced FY04 domestic funding to FY04 accounts. This maneuver would allow the Appropriators to move funds to important domestic accounts including education. However, these budgetary maneuvers still must gain final approval from the White House in order to counter objections from fiscal conservatives and defense supporters. If a deal can be reached on committee allocation levels soon, appropriators have indicated that they wish to move the Labor, Health and Human Services, and Education Appropriations bill as early as late June.

HEA Update
House Begins Work on the Reauthorization of the Higher Education Act

Last week, the House Education and the Workforce Subcommittee on 21st Century Competitiveness marked-up HR 2211, the Ready to Teach Act, which reauthorizes Title II, Part A of the Teacher Quality Enhancement Grants and the Preparing Tomorrow’s Teachers to Use Technology (PT3) program of the Higher Education Act (HEA). The Subcommittee passed the bill by voice vote and the full House Education and the Workforce Committee is expected to consider the bill this week.

The major news emerging from the introduction of this bill is the surprising inclusion of language to reauthorize the PT3 program for an additional four years. The PT3 program, which provides grant funds to colleges of education to develop or redesign teacher preparation programs to enable prospective teachers to use advanced technology effectively in their classrooms, has been targeted for elimination by the Administration over the past three funding cycles. Indeed, during the most recent debate on FY03 appropriations, it was nearly eliminated completely by Congressional appropriators at the urging of the White House. Thus, the decision of majority staff on the House Education & Workforce Committee to reauthorize PT3 with no significant changes represents an important victory for education technology advocates.

The bill also reauthorizes the three major grant programs that comprise Title II of HEA: the state, partnership and recruitment grant programs. The State grants program provides competitive grants to states to implement reforms on teacher preparation programs. The Partnership grants program provides competitive grants to partnerships, which must include a high quality teacher preparation program at an institution of higher education, a school of arts and sciences, a high need LEA, and a public or private educational organization, for a variety of uses. From an education technology perspective the most significant change to Title II is the insertion of new language that mandates that technology training for teachers be an allowable use of funds by recipients of State and Partnership grants. This represents a significant departure from current law, which only briefly mentioned technology training in the purposes section and did not include technology training as an allowable use of funds. Additionally, during the Subcommittee’s mark-up of the bill, the Subcommittee accepted an amendment by Rep. David Wu (D-OR) to allow entities receiving Partnership grants to use funds to develop and implement effective mechanisms to recruit employees from high-demand industries, including high technology industries, into teaching.

The legislation also requires states to submit an annual report describing how the state will increase, among other things, the number of teachers prepared effectively to integrate technology into curricula and instruction and the number who use technology to collect, manage, and analyze student academic achievement data to improve teaching, learning, and decision making. With current law only requiring states report on how states will “increase the number of teachers prepared to integrate technology in the classroom,” this new language should lead to the Department gathering more useful data on the benefits of teacher technology training.

E-Rate Update
Abernathy Hearing

In early May, FCC Commissioner Kathleen Abernathy led a forum on improving the administration of the E-Rate program that focused on preventing waste, fraud and abuse and reviewing the competitive bidding process. Commissioner Abernathy and three other Commissioners heard testimony from E-Rate coordinators for Virginia and Mississippi, Sprint and Bell South, and E-Rate recipients from public school systems in Seattle, WA, Central Susquehanna, PA, and Louisville, KY and the State Library of Florida. The witnesses found a few significant areas of agreement, most notably on the need for more education on program rules, on the ineffectiveness of the current rule requiring that all applicants post online their Form 470 applications, and on the importance of placing reasonable restrictions on school district applicants transferring internal connections equipment to schools that would be ineligible for internal connections discounts.

However, on one of the major issues facing the program, neither the witnesses nor the Commissioners in attendance could reach consensus on how to ensure that more applicants receive internal connections discounts. While all recognized that the current priority rules on internal connections funding coupled with the high demand for internal connections discounts have essentially blocked applicants with below 80% discount rates from receiving any internal connections support from the E-Rate over the past three program years, the witnesses could not agree on how to address this problem. A number of witnesses supported the concept of adjusting the discount matrix to both reach those applicants and create stronger incentives for applicants to be cost-effective by paying anywhere from 10% to 20% more of the cost of the service. However, the public school witnesses and FCC Commissioner Michael Copps remained skeptical that discount matrix adjustments could be made without raising a further obstacle to low-income applicants receiving internal connections discounts. FCC Commissioner Copps asked, “How do we prevent harming the poorest applicants with this system?” There was greater agreement among forum participants on improving internal connections distribution by precluding applicants from receiving internal connections discounts every year.

Although the hearing did provide an opportunity for discussing major E-Rate issues, it is not clear whether it will lead to any action on the E-Rate by Congress or the FCC. Commissioner Abernathy has not announced any plans to hold a second hearing.

Funding Commitment Update

The Schools and Libraries Division, the E-Rate’s administrator, has largely completed funding commitments for Year 5 of E-Rate. To date, it has committed $2.177 billion in discounts. SLD has not yet announced whether there will be sufficient funds available to provide discounts to applicants with 80% discount rates. Currently, only applicants with rates of 81% and above are eligible for internal connections discounts.

SLD has begun committing funds to Year 6 applicants, disbursing nearly $299 million for discounts on telecommunications and Internet access services over the past few weeks.

National Education Technology Plan Update
Department Begins to Craft National Education Technology Plan

Last month, the Department of Education announced that it was beginning the process of drafting a new National Education Technology plan. Since 1996, the Department of Education has prepared two National Education Technology plans, which are essentially broad national strategies related to the integration of technology into education. The new plan was authorized as part of the No Child Left Behind Act, and thus can be expected to closely reflect its priorities and approach to student achievement. Whereas the earlier plans focused on bringing technology into the classroom, the new plan will be a forward-looking document intended to support the effective use of technology to improve student academic achievement. More specifically, the new plan will review what has been accomplished, develop a consensus on best practices, and define areas for future focus. The plan will also identify any existing policy barriers to integrating technology in education and make recommendations for actions to eliminate these barriers.

The Department is seeking input from education stakeholders on the plan. Parties may provide input by visiting the National Education Technology Plan’s Website at http://www.NationalEdTechPlan.org .