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Federal Stimulus Package Update

To:Superintendents and Charter School Leaders
From:Mitchell D. Chester, Ed.D., Commissioner
Date:February 17, 2009


I know you have all been following the news reports of the federal stimulus bill and its promise of additional federal funds for K-12 education. This bill, officially titled the American Recovery and Reinvestment Act of 2009 (ARRA), was passed by Congress Friday evening and will be signed into law today by President Obama.

With respect to K-12 education, ARRA provides:

  • $13 billion in additional Title I funding
  • $11.3 billion in additional IDEA funding
  • A new $53.6 billion state stabilization fund (see below)
  • $24.8 billion in new tax credits to support school building construction and modernization
  • Smaller increases for a number of other education grant programs.

In some cases, these funds could be available for use beginning in fiscal year 2009. Some funds will be available for use in fiscal years 2010 and 2011.

Once we have received our official state allocations for these programs, we will be able to calculate allotments for each district. We are also awaiting guidance from the U.S. Department of Education (USED) on application and accounting requirements for each category of funds, as well as maintenance of effort and "supplement not supplant" requirements. I have already been in touch with USED Secretary Arne Duncan. He knows that states and local districts are in the middle of their budget debates for FY10, and he has pledged to move as expeditiously as possible on calculating state allotments and promulgating requirements for the receipt and use of these funds. At the same time, he understandably wants to ensure that funds are used in a transparent and appropriate manner, with the highest degree of accountability.

The state stabilization fund is a new program that earmarks approximately $53 billion to assist states in meeting their obligations under their existing funding formulas for both K-12 (which in our case is the Chapter 70 program) and higher education for school construction and modernization; for state incentive grants; and for supplemental funding for a range of governmental services.

The allocation and use of the state stabilization fund will be determined by each state's governor. I am working closely with Massachusetts Secretary of Education Paul Reville to help provide the Governor's office with the information he will need to make his decisions. Governor Patrick has appointed Jeff Simon to oversee all of the state activities under ARRA, and his office has set up a special webpage at to keep everyone informed.

Much needs to be done before we can make commitments to your districts for a specific amount of funds under any of these programs. But I expect that we will be answering most of these questions over the next week or two. I know that many of you have budget timetables that are mandated either by town bylaws, city charters, or regional agreements. To the degree that you have the flexibility to delay your final budget decisions until we can get you this information, you may wish to do so. Otherwise, you should be discussing with your town and city officials contingency plans for revisiting your budget later this spring, after final allocations of the federal funds have been released.

I will update you again as soon as any new reliable information is available. In the meantime, if there is anything we can do to assist you, please contact either me or Jeff Wulfson, associate commissioner for school finance.

Last Updated: February 17, 2009

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