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Schools wrestle with how to spend stimulus funds

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With local governments – battered by foreclosures and a plunge in housing values – covering about 44 percent of K-12 public school costs, the overall budget shortfall would have been even deeper.

"We have districts that were laying off people by the hundreds and thousands," says Michael Casserly, executive director of the Council of the Great City Schools, a coalition of the nation's largest city school districts.

"It could do nothing but wreak havoc on the progress that these urban districts have made academically over the last several years," he said.

In many cities, class size – one of the most consistent elements in strategies to improve student achievement – would have jumped to more than 40 students per class, up from 25. School districts were also projecting cuts in building repair and renovation.

To avert thousands of teacher layoffs, Secretary Duncan announced on March 7 that $44 billion in stimulus funding will be made available to states in the next 30 to 45 days.

The stimulus plan provides $54 billion in new federal dollars for a State Fiscal Stabilization Fund to replace state spending cuts, including $8.8 billion for priority initiatives of governors that could include education.

Another $13 billion in stimulus funding will boost programs to help schools serving poor families under Title I of the Elementary and Secondary Education Act, and $12 billion is assigned to the Individuals with Disabilities Education Act (IDEA).

But Washington also wants to use stimulus funding to leverage changes in how schools operate. To be eligible for a second round of funding, states and local school districts must demonstrate that they are also serious about reform.

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