News : Cover Stories
A capacity issue
This article orginally appeared in the January, 2010 issue of Catalyst. Click here to see that issue's table of contents.

Ohio total Title 1 stimulus funding
As money rolls in, state and school officials face accounting and other challenges

Ever run through billions of dollars in a few months?

It’s not as easy as it might seem, especially when you have to account for every penny, fill out thousands of pages of paperwork and meet ever-moving deadlines.

Virtually all of the state education departments that are processing the billions in federal stimulus dollars are cash-strapped and running with skeleton staffs. The Ohio Department of Education, for example, has been understaffed and overworked for the last two years.

Meanwhile, the list of tasks the department has been given has steadily grown: No Child Left Behind compliance, implementation of a new school-funding system, training teachers in the use of value-added data, monitoring charter schools. Now, it has to apply for, process and track millions in federal stimulus dollars.

“I think capacity is a big issue,” says Mark Real, president of KidsOhio.org, a Columbus-based education reform group. “People over there are working very hard, but these are very ambitious programs they are being asked to handle.”

The department, which has a staffing ceiling of 711 full-time employees, has seen its workforce shrink from 658 employees in November 2007 to 601 in November 2009. More important, it has lost a number of key senior-level staffers, including associate superintendents Mitchell Chester and Paolo DeMaria, and Todd Haynes, who oversaw charter schools. Furlough days and hiring and travel freezes make recruiting a challenge.

“I worry about what affect that will have on education and on Ohio’s opportunity to get more federal money,” Real adds.

States’ education departments, which in Washington lingo are considered the “prime” recipients of the money, are required to report the type and amount of the stimulus project, a description of how the money has been spent, the status of the project and how many jobs have been saved or created.

In turn, they have to rely on information from local districts, which report to the states how they spent their money, how much they spent, which venders received it, and where those venders are located.

Districts were also handed the onerous task of putting systems in place to track the money spent. In most cases, that means setting up separate accounting codes so reports can be generated on where and how money was spent. They were “helped” by hundreds of pages of regulations from a dizzying array of federal agencies.

No wonder, then, that as of the Sept. 30 reporting deadline, states had spent just $13.9 billion of the $58.5 billion in education stimulus funds they were awarded. In Ohio, just $347 million of the state’s $2.2 billion award had been spent.

“I think capacity is a huge problem,” says Scott Palmer of EducationCounsel, a Washington, D.C.-based organization that collaborates with other groups on education reform. “It’s a huge challenge to use the money within this window.

“There’s not a single dollar for state tracking,” he adds. “Once the money goes out, it’s hard to go back and add a tracking system.”