Home AdvocacyPolicyWashington Notes2004 Apr

• Budget: The Conference Committee is expected to resume this week and will likely complete action on the budget in early May.
• E-Rate: The Universal Service Administrative Company (USAC) announced that it fully funded all eligible internal connections applications down to the 70 percent level.
• NCLB Rules Changes: The Department of Education has announced another in a series of changes to rules governing the implementation of the No Child Left Behind Act (NCLB).
• Adminstration Calls for Testing for 12th Graders: The Administration announced its support for a new testing proposal that would expand reading and math testing in the National Assessment of Educational Progress (NAEP) for 12th graders.
• Report Released on Trends in Title II, D: The State Education Technology Directors Association (SETDA) recently released a report that details the results of a national survey that asked how grant recipients across the country were structuring state and local programs to utilize their Title II, D funds.

The Conference Committee is expected to resume this week and will likely complete action on the budget in early May.

Late last month, the Senate and House began conferencing their respective FY05 budget resolutions, but had to postpone action due to the Easter recess. The Conference Committee resumed negotiations when Congress returned the week of April 19 and will likely complete action on the budget in early May.

One of the biggest obstacles facing the Conference is the wide discrepancy in budget allocations levels sought in the two competing bills. The Senate version of the FY05 budget totals $2.36 trillion, with $81.1 billion in discretionary funding for the Function 500 account, including programs within Education, Training, Employment and Social Services. Conversely, the House version of the FY05 budget totals $2.41 trillion, with $80.78 billion for the Function 500 account—equaling more than $200 million less than the Senate allocation. Additionally, the Conference Committee must resolve differences on the size of the tax cuts, with the House pushing for larger tax cuts than those presented in the Senate proposal.

Another major point of contention during the Conference will be the pay-as-you-go (Pay/go) rules. The Pay/go rules are budget procedures that ensure that all legislation affecting direct spending or receipts be budget-neutral in each fiscal year. Thus, funding cuts or tax increases must offset any spending increases. The Senate budget resolution contains a Pay/go provision that is strongly supported by Senators concerned about budget deficits, including Senate moderates. The House budget resolution does not have this provision and is strongly opposed by the House Republican leadership.

While the budget resolution is not sent to the President for his signature and is non-binding, the budget does provide a blueprint of Congressional action on Appropriations. The Appropriators tend to use the budget as a guide but have been known to overlook the budget and utilize different funding numbers.

The Budget Conference Committee Conferees include:
Senate
Sen. Don Nickles (R-OK), Chairman
Sen. Pete Domenici (R-NM)
Sen. Chuck Grassley (R-IA)
Sen. Judd Gregg (R-NH)
Sen. Kent Conrad (D-ND), Ranking Member
Sen. Fritz Hollings (D-SC)
Sen. Paul Sarbanes (D-MD)

House
Rep. Jim Nussle (R-IA), Chairman
Rep. Rob Portman (R-OH)
Rep. John Spratt (D-SC), Ranking Member

The Universal Service Administrative Company (USAC) announced that it fully funded all eligible internal connections applications down to the 70 percent level.

The Universal Service Administrative Company (USAC), the E-Rate program’s administrator, closed out Funding Year 2003 with something of a bang by announcing that it had been able to fully fund all eligible internal connections applications down to the 70 percent level. Thanks to the infusion of more than $400 million in unused E-Rate funds from earlier funding years, USAC was able to issue commitments totaling more than $2.467 billion, with $1.4 billion of that figure directed to internal connections applications.

USAC also announced that the new Funding Year would be opening with some surprises of its own. The biggest surprise, reported in its FY 2004 Estimate of Demand letter, was that demand for E-Rate funds from FY04 applicants actually fell approximately nine percent over FY03, with the majority of that decline occurring in the internal connections and Internet access categories. Demand for telecommunications services remained largely stable. Overall, according to USAC, applicants sought $4.278 billion in E-Rate discounts, representing some $440 million less than last year. Other interesting facts that emerged from USAC’s letter include:

• Demand for all services at the 90 percent level declined dramatically;
• Requests for internal connections between the 80 percent and 89 percent brackets grew substantially; and
• Overall requests for internal connections totaled $2.678 billion, with nearly half of that figure coming from the 90 percent level, an additional $1.061 billion coming from the 80 percent to 89 percent bracket, and much smaller sums requested in lower brackets.

USAC expects further reductions in the overall demand once it eliminates duplicate applications and ineligible services.

Meanwhile, the Federal Communications Commission (FCC) completed its comment cycle on its most recent Further Notice of Proposed Rulemaking on the E-Rate program. ISTE filed extensive initial comments in this proceeding in March and filed shorter Reply Comments in mid-April that focused solely on the Commission’s proposals to lower the top discount level for internal connections by 10 or 20 percent. In its comments, ISTE reiterated its objections to this proposal that: (1) the new twice-every-five-year rule, which permits applicants to receive funding only twice every five years for internal connections, should be afforded ample time to operate in order to determine whether it has accomplished the Commission’s goals; (2) additional rules on top of the twice-every five-year-rule may sow confusion in the ranks of applicants and vendors alike, potentially chilling their interest in participating in the program; and (3) some of the neediest applicants would be required to pay larger proportions of eligible service costs, thereby making it impossible for them financially to participate in the program. ISTE also supplied anecdotes from schools and districts across the country that would be harmed should the Commission institute another discount matrix adjustment. Sources indicate that the Commission may issue additional orders this summer based on issues raised in this proceeding.

On Capitol Hill, the long-awaited hearings on E-Rate waste, fraud, and abuse may finally occur. The House Commerce Committee’s Subcommittee on Oversight and Investigations is expected to announce that it is scheduling a hearing on May 19 that will feature testimony from USAC and FCC officials and focus on E-Rate waste, fraud, and abuse in Puerto Rico. In the program’s early years, USAC suspended payments to Puerto Rico’s Department of Education after an audit determined that the Department had inadequate electrical infrastructure to support computers and had failed to install computers to make use of E-Rate supported in-school wiring. Subsequent investigations uncovered competitive bidding violations, poor service from a particular provider and illegal uses of funds. After a change in gubernatorial administrations, the criminal conviction of Puerto Rico’s former Secretary of Education, and strenuous efforts by Puerto Rico’s new governor to upgrade the territory’s school infrastructure and hardware, the FCC agreed to begin processing some of its previous years’ applications. Other investigations and audits of waste, fraud, and abuse of the E-Rate program are proceeding as well. This hearing is expected to be the first in a series aimed at bringing to light program administration weaknesses.

The Department of Education has announced another in a series of changes to rules governing the implementation of the No Child Left Behind Act (NCLB).

The Department of Education has announced another in a series of changes to rules governing the implementation of the No Child Left Behind Act (NCLB). The latest flexibility rule relaxes requirements regarding student participation rates in assessments.

The new changes will allow states to take an average of student participation rates over a three year period to reach the required 95 percent student participation threshold for valid assessments. Prior to the rule change, schools were required to have at least 95 percent participation rate in assessments for all sub-groups within a single school year. Schools that failed to meet this threshold were deemed “in need of improvement” and thus subject to various remedial measures. Additionally, the Department announced that students that are absent during testing due to a “unique and significant emergency” would no longer be counted against the school’s participation rate.

This announcement represents the fourth major NCLB rules change from the Department. Over the past few months, the Department has released changes to rules regarding highly qualified teachers, special education students, and limited-English proficient students. It is unclear if additional changes are forthcoming. For more information, please read the Department’s announcement: http://www.ed.gov/news/pressreleases/2004/03/03292004.html

Adminstration Calls for Testing for 12th Graders.

Earlier this month, the Administration expressed support for a new testing proposal that would expand reading and math testing for 12th graders. Currently, 4th and 8th graders in all states take the National Assessment of Educational Progress (NAEP) every other year. This new proposal is relatively non-controversial because the test results do not determine whether a school or district is in need of improvement, nor do they dictate a school’s funding levels. The proposal would require Congressional action, but it is unclear whether Congress will take action this year due to the short legislative session.

The State Education Technology Directors Association (SETDA) recently released a report that details the results of a national survey that asked how grant recipients across the country were structuring state and local programs to utilize their Title II, D funds.

The State Education Technology Directors Association (SETDA), in conjunction with the METIRI Group, recently released its report entitled “National Trends: Enhancing Education Through Technology.” The report details the results of a national survey that asked how grant recipients across the country were structuring state and local programs to utilize their Title II, D funds.

Respondents included 46 states and the District of Columbia, and represented 92 percent of total Title II, D federal dollars distributed in FY02.

Key findings from the report included:

• Title II, D has been effective in refocusing technology use toward gains in student learning and achievement.
• Nearly all grantees both for the competitive and formula programs are utilizing the full 25 percent of funds for professional development purposes. Less than one percent of Local Education Agencies were found to be using waivers to redirect mandated professional development funds to other areas.
• More and more states are collaborating with other NCLB programs to administer Title II, D funds. For instance, states are using consolidated applications, building consortia for competitive grant programs, and consolidating administrative and technical support for various federal programs.
• Although empowered by NCLB to transfer funds into or out of Title II, Part D, few states have opted to transfer their federal education dollars. In fact, the report found a net gain for Part D through transferability of $2.3 million nationwide; however, approximately only $6 million in funds were transferred into or out of Part D.
• Given the comparatively small awards distributed through the formula program, most grantees are using formula funds to sustain existing technology programs.
• Evaluating the effectiveness of the program requires state leadership. More than 57 percent of respondents report that they are conducting a state-level evaluation of Title II, D competitive grants.
• States are beginning to build technology-based learning programs that advance the goals set forth in Title II, D. However, respondents indicated that a more comprehensive knowledge base of sound research and best practices in the education technology field was necessary.

The entire report can be found at http://www.setda.org.

Glossary

Conference Committee – A committee composed of temporary panelists from the House and Senate that meet to reconcile differences between the House and Senate versions of a bill.

Title II, D – Through this program, states receive block grant funds to be used by districts for virtually any technology purpose. States distribute half of the money they receive to districts by formula and half by competition. Districts must set aside 25 percent of all block grant funds for professional development in technology, with a special emphasis on training in the integration of advanced technologies (including emerging technologies) into the curriculum.

CTC - Community Technology Centers - This program provides grants to promote the development of model programs that demonstrate the educational effectiveness of technology in urban and rural areas and economically distressed communities. Typically, these programs provide access to computers and other forms of information technology as well as related learning services to adults and children in an educational setting.

Education Technology Block Grant - Through this program, states receive block grant funds to be used by districts for virtually any technology purpose. States distribute half of the money they receive to districts by formula and half by competition. Districts must set aside 25% of all block grant funds for professional development in technology, with a special emphasis on training in the integration of advanced technologies (including emerging technologies) into the curriculum.

Function 500 - During the Budget resolution process, the Senate and House sort Federal government spending into twenty spending categories. The Function 500 category covers federal government spending in the following areas: Education, Training, Employment and Social Services.

pay-as-you-go (PAYGO) - A Budget procedure that ensures that all legislation affecting direct spending or receipts is budget neutral in each fiscal year. Thus, any spending increases must be offset by funding cuts in other areas or tax increases.

Professional Development - Under this program, states receive a formula grant from the Department of Education for professional development, teacher recruitment and retraining. States and districts may use their Title II money to foster technology mastery in teachers and principals and to employ technology to improve teaching and administrative skills. Among other things, grantees may use these funds to encourage and support the training of teachers and administrators to effectively integrate technology into curricula and instruction, including training to improve the ability to collect, manage, and analyze data to improve teaching, decision making, school improvement efforts and accountability.

PT3 - Preparing Tomorrow's Teachers to Use Technology - PT3 provides grants primarily to institutions of higher education train pre-service teachers in how to use technology and effectively integrate it into the curricula.

Star Schools Program - This competitive grant program funds distance learning projects nationwide and focuses on serving small rural and large urban schools. Projects use a variety of distance education technologies, including satellites, cable and the Internet, to develop and deliver various instructional programs such as video field trips.

Title I - Funding for the Title I program in the Elementary and Secondary Education Act represents the largest single investment that the federal government makes in elementary and secondary education. This formula grant program provides funding to schools and districts based on the population of disadvantaged students in order to support programs that improve their academic performance. Technology purchases are often made through Title I funds.