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Analysis: Districts in Most States May Lose Title I Money Under Obama Budget

Districts in more than 30 states could stand to lose a small portion of their Title I funding if Congress adopts the president's fiscal year 2017 proposal for the program without any changes, according to an unpublished analysis by the Congressional Research Service obtained by Politics K-12.

Districts in Michigan could stand to lose the most, according to the report—more than $10 million out of $495 million in Title I funding overall currently. Other states facing losses include Mississippi, which could lose nearly $5 million out of $186 million in Title I funding overall, according to the analysis. Other potential cuts are smaller, relatively speaking. Alaska districts could lose about $40,000.

The report could provide fuel for advocates for districts that have expressed dismay that the FY 2017, which would go into effect largely during the 2017-18 school year (the first year that the new Every Student Succeeds Act will be in place), would essentially level-fund the main federal K-12 program for disadvantaged students, Title I.

Some wonky background: Under the president's budget, which was released in February, Title I would get about $15.4 billion, or roughly $450 million more than current levels. That probably sounds like a big increase. But it isn't, because ESSA eliminated the Title I School Improvement Grant program, which is currently funded at $450 million. That money would simply be folded into the new proposed total for Title I.

So where do these potential cuts come from? Even though it eliminated the school improvement program, ESSA sought to provide other resources for improving struggling schools by upping the amount of Title I funding states must set aside for that purpose, from 4 percent to 7 percent. But, crucially, for just one year, it suspends a requirement that districts be "held harmless," meaning that for the 2017-18 school year—and for that year—districts can receive less Title I funding than they did the previous year, to make room for the state set-aside. The report assumes all states are currently taking the full 4 percent set-aside.

What's more, ESSA allows state education departments to hold back up to 3 percent of Title I funds for programs such as tutoring if they so choose. That could result in less Title I money per district, advocates fear. 

The CRS report isn't all bad news, however. Districts in other states may actually stand to gain. For instance, districts in Florida may end up with about $4 million in additional Title I money.

Still, it's a sure bet that advocates for districts will use the CRS report to make their case to lawmakers overseeing K-12 that Title I should get more than the $15.4 billion the department is seeking. 

For its part, the Education Department doesn't appear to expect the potential funding loss in certain states would have a serious impact. The possible cut to district level Title I grants would amount to about $200 million overall, for a more than $15 billion program. Amy McIntosha senior advisor filling the role of the assistant secretary overseeing planning, evaluation and policy, told advocates at a meeting on the department's budget request that any funding changes would be relatively minor. What's more, she pointed out that the president's budget asks for more money for Title I than ESSA authorizes. 

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