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Shutdown Plan: Stimulus Audits, Student Loans Will Go On

UPDATE (11:36 p.m.): A government shutdown looked likely until quite literally the 11th hour tonight, when the two sides announced a deal and set to work on passing a short-term spending plan that would give Congress a few more days to hammer out a longer-term agreement.


The U.S. Department of Education's contingency plan, just posted online, spells out which programs will remain operational if tonight's midnight deadline passes and there is a government shutdown.

If a shutdown lasts a week, the department expects to keep 271 employees working. These include presidential appointees (think Arne Duncan), Senate-confirmed employees (think master communications guy Peter Cunningham), and those necessary to protect "life and property" (security guards?). If the shutdown lasts any longer, the department plans to need 312 employees each subsequent week.

The bulk of the employees who would keep working are those responsible for the federal government's new direct student loan program. "A potential lapse in appropriations that might occur during April or May of 2011 would fall at a critical point in the student financial-aid process," the contingency plan says. "Many students are weighing postsecondary options ... [t]his type of disruption in service would result in potential loss of federal assets and student aid delivery would be at risk."

The next biggest chunk of employees who would stay on the job, or 68 people per week, would be those responsible for auditing stimulus spending.

School district officials around the country are probably thanking their lucky stars that most programs, including Title I and special education, are "forward funded," meaning that the money set for fiscal year 2011 won't flow until this summer. That means districts won't have a major interruption in federal funding.

There's just one major K-12 program that isn't forward funded: Impact Aid. Those funds help offset lost tax revenue for districts that have a major federal presence, such as a military base, Native American reservation, or other federally owned land.

A number of districts asked for—and got—advanced appropriations to help them weather the current funding flux, John Forkenbrock, the executive director of the National Association of Federally Impacted Schools, told my co-blogger Alyson Klein. And the Office of Management and Budget, preparing for a shutdown, has set aside $93 million to help others. And some of the funds may go out before the weekend, Forkenbrock said.

Right now, no district is in danger of going bankrupt or laying off staff if there is a short shutdown. But, he said, a few are canceling field trips or delaying purchases. Of course, the longer a potential shutdown goes on, the tougher the fiscal situation becomes for these schools.

Beyond Impact Aid, the impact of a government shutdown on K-12 would be minimal. However, it would not be a good time to need information or get questions answered for the myriad of programs the department runs. If you do, you'll likely go straight to voice mail or get an automated email response, given this lengthy list of programs that won't be staffed during a shutdown.

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