[Senate Hearing 112-717] [From the U.S. Government Publishing Office] S. Hrg. 112-717 THE IMPACT OF SEQUESTRATION ON EDUCATION ======================================================================= HEARING before a SUBCOMMITTEE OF THE COMMITTEE ON APPROPRIATIONS UNITED STATES SENATE ONE HUNDRED TWELFTH CONGRESS SECOND SESSION __________ SPECIAL HEARING JULY 25, 2012--WASHINGTON, DC __________ Printed for the use of the Committee on Appropriations [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT] Available via the World Wide Web: http://www.gpo.gov/fdsys/browse/ committee.action?chamber=senate&committee=appropriations __________ U.S. GOVERNMENT PRINTING OFFICE 75-443 PDF WASHINGTON : 2013 ----------------------------------------------------------------------- For sale by the Superintendent of Documents, U.S. Government Printing Office Internet: bookstore.gpo.gov Phone: toll free (866) 512-1800; DC area (202) 512-1800 Fax: (202) 512-2104 Mail: Stop IDCC, Washington, DC 20402-0001 COMMITTEE ON APPROPRIATIONS DANIEL K. INOUYE, Hawaii, Chairman PATRICK J. LEAHY, Vermont THAD COCHRAN, Mississippi TOM HARKIN, Iowa MITCH MCCONNELL, Kentucky BARBARA A. MIKULSKI, Maryland RICHARD C. SHELBY, Alabama HERB KOHL, Wisconsin KAY BAILEY HUTCHISON, Texas PATTY MURRAY, Washington LAMAR ALEXANDER, Tennessee DIANNE FEINSTEIN, California SUSAN COLLINS, Maine RICHARD J. DURBIN, Illinois LISA MURKOWSKI, Alaska TIM JOHNSON, South Dakota LINDSEY GRAHAM, South Carolina MARY L. LANDRIEU, Louisiana MARK KIRK, Illinois JACK REED, Rhode Island DANIEL COATS, Indiana FRANK R. LAUTENBERG, New Jersey ROY BLUNT, Missouri BEN NELSON, Nebraska JERRY MORAN, Kansas MARK PRYOR, Arkansas JOHN HOEVEN, North Dakota JON TESTER, Montana RON JOHNSON, Wisconsin SHERROD BROWN, Ohio Charles J. Houy, Staff Director Bruce Evans, Minority Staff Director ------ Subcommittee on Departments of Labor, Health and Human Services, and Education, and Related Agencies TOM HARKIN, Iowa, Chairman DANIEL K. INOUYE, Hawaii RICHARD C. SHELBY, Alabama HERB KOHL, Wisconsin THAD COCHRAN, Mississippi PATTY MURRAY, Washington KAY BAILEY HUTCHISON, Texas MARY L. LANDRIEU, Louisiana LAMAR ALEXANDER, Tennessee RICHARD J. DURBIN, Illinois RON JOHNSON, Wisconsin JACK REED, Rhode Island MARK KIRK, Illinois MARK PRYOR, Arkansas LINDSEY GRAHAM, South Carolina BARBARA A. MIKULSKI, Maryland JERRY MORAN, Kansas SHERROD BROWN, Ohio Professional Staff Erik Fatemi Mark Laisch Adrienne Hallett Lisa Bernhardt Michael Gentile Robin Juliano Laura A. Friedel (Minority) Sara Love Rawlings (Minority) Jennifer Castagna (Minority) Administrative Support Teri Curtin C O N T E N T S ---------- Page Opening Statement of Senator Tom Harkin.......................... 1.............................................................. Sequestration's Across-the-Board Cut............................. 1.............................................................. Sequestration's Impact on Nondefense Jobs and Services........... 1.............................................................. Report on Sequestration's Impact................................. 2.............................................................. Sequestration Study Shows Negative Impact on Gross Domestic Product........................................................ 2.............................................................. Statement of Senator Richard C. Shelby........................... 3.............................................................. Too Few Facts From Administration on Precise Impacts............. 3.............................................................. Chairman's Sequestration Report.................................. 3.............................................................. Budget Control Act of 2011....................................... 4.............................................................. Indiscriminate Cuts to Programs.................................. 4.............................................................. Federal Deficit.................................................. 4.............................................................. Education Budget Request......................................... 5.............................................................. Prepared Statement of Senator Barbara A. Mikulski................ 5.............................................................. Impact of Sequestration on Education............................. 5.............................................................. Statement of Arne Duncan, Secretary of Education, Department of Education...................................................... 6.............................................................. Timeframe for Sequestration...................................... 7.............................................................. Arbitrary Cuts Affect Effective and Ineffective Programs......... 7.............................................................. Short-Term Fix to Long-Term Budget Problems...................... 7.............................................................. Sequestration Cuts Would Undermine Equity and Reform............. 8.............................................................. Cuts to Education Impact Military Preparedness................... 8.............................................................. K-12 Education Impact Would Begin in Fall 2013................... 8.............................................................. 7.8-Percent Cut and Some Specific Impacts........................ 8.............................................................. Title I, Elementary and Secondary Education Act Impact........... 8.............................................................. Special Education Impact......................................... 9.............................................................. Impact Aid Cuts Would Take Effect January 2...................... 9.............................................................. Student Loans Impact............................................. 9.............................................................. Other Federal Agency Cuts Also Impact Education.................. 9.............................................................. Head Start Program Impact........................................ 9.............................................................. National Institutes of Health and National Science Foundation Impact......................................................... 9.............................................................. Sequestration Should Be Avoided.................................. 9.............................................................. Prepared Statement of Arne Duncan................................ 10............................................................. Congressional Budget Office Estimate of Sequestration Impact..... 10............................................................. Impact on State Formula Grant Programs........................... 11............................................................. Impact on Student Aid Administration............................. 11............................................................. Immediate Effect on Impact Aid and Vocational Rehabilitation..... 12............................................................. Effect on Education if Defense Is Made Exempt.................... 12............................................................. Congressional Budget Office Estimates--Basis for Projected Education Cuts................................................. 13............................................................. Priorities Assuming Cuts......................................... 14............................................................. Education Budget an Investment in the Future..................... 14............................................................. Pell Grant Exempt From Sequestration............................. 15............................................................. Joint Subcommittee on Deficit Reduction.......................... 15............................................................. Damaging Impact on Families and Communities...................... 16............................................................. Impact of Sequestration on U.S. Competitiveness.................. 60............................................................. Foreign Countries Increasing Their Competitiveness............... 61............................................................. Balanced, Bipartisan Action Needed............................... 61............................................................. Impact of Exempting Defense From Sequestration................... 62............................................................. Sequester's Impact on Already Tight State/Local Budgets.......... 62............................................................. Important To Maintain Current Reform Efforts..................... 63............................................................. Competitiveness Important to National Security................... 63............................................................. Impact of Sequester on School Reform............................. 63............................................................. Broad, Indiscriminate Impact on Education in All Local Education Agencies....................................................... 64............................................................. Potential To Undermine Reforms Achieved and Planned.............. 65............................................................. Change Since the Last Balanced Budget............................ 65............................................................. Examples of Impact on Chicago Schools............................ 66............................................................. Access to After-School Activities Among Cuts..................... 66............................................................. Relationship Between After-School Activities and Drop in Crime... 66............................................................. All Options for Fiscal Cuts Must Be on the Table................. 67............................................................. Importance of Compromise......................................... 67............................................................. Implementation of Education Budget Cuts.......................... 67............................................................. Across-the-Board Cut to Education................................ 68............................................................. Global Competitors Increasing, Not Cutting Budgets............... 68............................................................. Education Cuts Absent Sequestration.............................. 68............................................................. Education Is an Investment, Not an Expense....................... 69............................................................. Guidance to Local Education Agencies If Sequester Is Enacted..... 69............................................................. Impact on Rural Areas and Students With Disabilities............. 69............................................................. Sequestration Effect on Impact Aid............................... 69............................................................. Education Budget Increases Since 2008............................ 70............................................................. Nondepartmental Witnesses........................................ 71............................................................. Statement of June Atkinson, State Superintendent of Public Instruction, Raleigh, North Carolina........................... 71............................................................. Prepared Statement of........................................ 73......................................................... Statement of Billy Walker, Ed.D., Superintendent, Randolph Field Independent School District, University City, Texas............ 76............................................................. Prepared Statement of........................................ 77......................................................... Statement of Neal P. McCluskey, Associate Director, Center for Educational Freedom, The Cato Institute, Washington, DC........ 79............................................................. Prepared Statement of........................................ 81......................................................... Inflation-Adjusted Federal K-12 Spending Per Pupil and Achievement of 17-Year-Olds, Percent Change Since 1970......... 82............................................................. Inflation-Adjusted Cost of a Complete K-12 Public Education and Percent Change in Achievement of 17-Year-Olds Since 1970....... 82............................................................. Percent Change in Public School Employment and Enrollment Since 1970........................................................... 83............................................................. Statement of Tammy L. Mann, Ph.D., President and CEO, The Campagna Center, Alexandria, Virginia.......................... 85............................................................. Prepared Statement of........................................ 87......................................................... Additional Committee Questions................................... 97............................................................. Questions Submitted by Senator Tom Harkin........................ 97............................................................. Are Federal Education Programs Effective? Would Sequestration Harm Federal Education Programs?............................... 97............................................................. Impact on Education Programs of Sequestration if Pell Grant Program Is Exempt.............................................. 97............................................................. Question Submitted by Senator Herb Kohl.......................... 98............................................................. Sequestration Guidance for Institutions of Higher Education...... 98............................................................. Questions Submitted by Senator Mary L. Landrieu.................. 98............................................................. Impacts on Reform................................................ 98............................................................. Preparation for Sequester........................................ 98............................................................. Preventing Sequestration......................................... 99............................................................. Questions Submitted by Senator Richard C. Shelby................. 99............................................................. Education Program Priorities if Sequestration Takes Effect....... 99............................................................. Actions Taken To Increase Program Efficiencies Given Potential Sequestration.................................................. 99............................................................. Sequestration Impact on Unobligated Balances, Hold-Harmless, and Maintenance-of-Effort Provisions............................... 100............................................................ Option for New State and Local Flexibilities Under Sequestration? 100............................................................ Sequestration Impact on Local Education Agencies With Greater Reliance on Federal Funding.................................... 100............................................................ Sequestration Impact on Origination Fees for Student Loans....... 100............................................................ Questions Submitted by Senator Mark Kirk......................... 101............................................................ Sequestration Impact on Local Education Agencies Heavily Dependent on Impact Aid Funds.................................. 101............................................................ Departmental Guidance To Impact Aid Districts on Planning For Sequestration.................................................. 101............................................................ THE IMPACT OF SEQUESTRATION ON EDUCATION ---------- WEDNESDAY, JULY 25, 2012 U.S. Senate, Subcommittee on Labor, Health and Human Services, and Education, and Related Agencies, Committee on Appropriations, Washington, DC. The subcommittee met at 10:03 a.m., in room SD-124, Dirksen Senate Office Building, Hon. Tom Harkin (chairman) presiding. Present: Senators Harkin, Murray, Durbin, Reed, Pryor, Mikulski, Brown, and Shelby. opening statement of senator tom harkin Senator Harkin. The Subcommittee on Labor, Health and Human Services, Education, and Related Agencies will come to order. sequestration's across-the-board cut As everyone here is aware, under the Budget Control Act of 2011, virtually all Federal programs face an across-the-board cut in January 2013 if the Congress does not enact a plan before then to reduce the national debt by $1.2 trillion over the next 10 years. So far we've heard a great deal about sequestration's effects on Pentagon spending. The defense industry has highlighted the potential impact of an across-the-board cut on defense-related jobs and services. Some Members of Congress are now demanding that we exempt the Pentagon from sequestration either by finding offsets for the defense cuts only or by making nondefense programs bear the full brunt of the entire $1.2 trillion in cuts. sequestration's impact on nondefense jobs and services But sequestration wouldn't apply only to defense. It would also have destructive impacts on the whole array of programs that undergird the middle class in this country, everything from education to job training, medical research, childcare, food safety, national parks, border security, safe air travel, and on and on. These essential Government services and programs directly touch every family in America, and they will be subject to deep, arbitrary cuts under sequestration. Some Members of Congress warn that defense contracting firms will lay off employees if sequestration goes into effect. But they say nothing of the tens of thousands of teachers, police officers, and other public servants in communities all across America who would also lose their jobs. As far as I'm concerned, a laid-off teacher is just as unemployed as a laid-off defense contractor, and they're both paid by the taxpayers. report on sequestration's impact So it's important that we have an accurate assessment of the potential impact of sequestration on the nondefense side of the budget. To that end, this morning, I am releasing a report that provides a detailed analysis of sequestration's effects on dozens of labor, health, education, and related programs under the jurisdiction of this subcommittee that would happen in fiscal year 2013. Among the highlights of this report. States and local communities would lose $2.7 billion in Federal funding for just three critical education programs alone, Title I, Special Education State grants, and Head Start, that serve a combined 30.7 million children. Nationwide, these cuts would force roughly 46,000 employees to either lose their jobs or rely on cash-strapped States and localities to pick up their salaries instead. In health, 660,000 fewer people would be tested for HIV; 49,000 fewer women would be screened for cancer; 212,000 fewer children would be vaccinated. At a time when the unemployment rate is still above 8 percent, 1.6 million fewer adults, dislocated workers, and at- risk youth would receive job training, education, and employment services. And the families of 80,000 fewer children would receive childcare subsidies, making it harder for parents to find work. This report is available online and much of this information is available on a State-by-State basis. For example, you can go there and you can click on my State of Iowa and see that sequestration will result in about 4,700 fewer people being admitted to substance abuse treatment programs, or 500 fewer veterans receiving job assistance next year. So I urge you to go to the Senate Appropriations Committee Web site and view the report. And once you have read it, you'll understand why my colleagues and I adamantly oppose any unbalanced approach that protects the Pentagon and the wealthiest 2 percent in our society while ignoring cuts to nondefense services, including education, that's so critical to the middle class. I want to point out one paragraph that's in the foreword of this study. The study is called ``Under Threat''. You can get it on my official Web site also. We just released it this morning. [The information follows:] ``In fact, the economic effects of cuts to nondefense programs could be worse than cuts to Pentagon spending. A December 2011 study found that investing $1 billion in healthcare or education creates significantly more jobs within the United States economy than spending $1 billion on the military. In healthcare, the difference is 54 percent more jobs; in education, 138 percent more jobs.'' SEQUESTRATION STUDY SHOWS NEGATIVE IMPACT ON GROSS DOMESTIC PRODUCT Senator Harkin. A July 2012 study commissioned by the Aerospace Industries Association found that sequestration's cuts to nondefense spending would reduce the U.S. gross domestic product (GDP) during fiscal years 2012 to 2021 by a greater amount than cuts to defense spending. The study commissioned by the Aerospace Industries Association said that sequestration's cuts to nondefense discretionary spending, under the jurisdiction of this subcommittee, would reduce our GDP during the next 10 years by a greater amount than cuts to defense spending. I did not commission that study. It was done by the Aerospace Industries Association. The links to both of the reports mentioned above are available in our subcommittee report ``Under Threat''. So a better and fairer solution is needed. That is the way we solved our previous budget crises in 1982, 1984, 1990, 1993, with a balanced approach that includes both spending reductions and new revenue. In the 5 years following the 1993 deficit-reduction law, the U.S. economy created more than 15 million new jobs. Not only did we balance the budget, we were on a course to completely eliminate the national debt within a decade. So again, we can repeat this success. We don't have to reinvent the wheel. So I hope that this report and today's hearing will motivate members of both parties to embrace a spirit of compromise. The time for ideological posturing is past. We all agree that sequestration would be tremendously destructive. We all want to avoid it. That means we all must come together with good will to hammer out a balanced agreement that will not only prevent sequestration but reduce our deficit and protect America's families. Today's hearing examines the impact of across-the-board cuts specifically on education, but it could have just as easily focused on health or labor. But I think education will provide an instructive example of the kinds of arbitrary cuts that would be required in nondefense services if sequestration goes into effect. We will hear first from Secretary of Education Arne Duncan and then from a second panel of educators who can explain the local and State impacts of sequestration. I now yield to Senator Shelby for his opening remarks. STATEMENT OF SENATOR RICHARD C. SHELBY Senator Shelby. Thank you, Mr. Chairman. Mr. Secretary, thank you for joining us again today to discuss very hot topics like sequestration on the Department of Education. TOO FEW FACTS FROM ADMINISTRATION ON PRECISE IMPACTS I am disappointed that the administration to date has not provided the Congress any details on the impact of sequestration. While most of the attention has focused on the devastating and disproportionate cuts to our national security, sequestration will cause considerable impact to all parts of our Federal budget. The across-the-board cuts that are mandated under sequestration are not the answer to confront our fiscal problems. CHAIRMAN'S SEQUESTRATION REPORT I appreciate the chairman's focus on sequestration and the work of his staff on the sequestration report he is releasing today. However, I am concerned this report does not present an accurate portrayal of the impact of sequestration, because we have not been provided any concrete information by the administration to make these assumptions. For example, the Congress does not know the amount of the across-the-board cut. As the chairman's report states, it could be anywhere between 7.8 and 8.4 percent. In real terms, this is a difference of $1 billion in the Labor-HHS program reductions. Second, we have no clarity on which Labor-HHS programs are exempt from sequestration. The more programs that are exempt Governmentwide, the higher the sequestration percentage becomes. Third, the report specifies job cuts across programs and States, yet we simply have too little definitive information to know if these numbers are accurate. The only thing we do know is that agencies, programs, and States will have some flexibility to determine how reductions are taken and that all cuts will not necessarily lead to layoffs. Finally, while the report shows some of the potential impacts of sequestration, it makes significant assumptions, based on unknown data, as to how these cuts will be implemented. While the chairman has tried to show the effects of sequestration on Labor-HHS programs, in fact, it's only the Office of Management and Budget (OMB) that can accurately provide this type of information. Unfortunately, they have remained silent on the issue. It is as if the administration might want Members of Congress to be both blind and mute on sequestration. This cannot continue. Mr. Secretary, I look forward to us having a frank and a specific discussion about the impact of sequestration with you. BUDGET CONTROL ACT OF 2011 Mr. Chairman, like you, I did not vote for the Budget Control Act of 2011. I opposed the bill, because, as we are now seeing firsthand, it was a compromise on our financial future. The Super Committee was a failure. It was unable to garner even $1 of savings. And as a result, our entire Government is now facing the possibility of severe cuts that will impact all aspects of our society. INDISCRIMINATE CUTS TO PROGRAMS The across-the-board cuts that result from the Super Committee's epic failure last year will be broad, blunt, and slash all programs indiscriminately. Sequestration is not the right approach, I believe, to end our fiscal turmoil. In fact, its mere existence has caused huge financial uncertainty around the country. I believe we need to find a solution to this problem now and end the uncertainty crippling school districts, small businesses, and education providers. We should not delay a solution to score political points. FEDERAL DEFICIT And while the chairman and I agree that sequestration will have a severe and detrimental impact on the Department of Education, we cannot forget how we got to this point in the first place. Our Nation is $15.8 trillion in debt, a number that grows by $42,000 every second. EDUCATION BUDGET REQUEST In the past few years, the Federal Government has been recording the largest budget deficits since 1945. Yet the Department of Education's budget request for 2013 did little to curb spending to put our Nation on a fiscally sustainable path. In fact, it asked for an increase of $1.7 billion in discretionary spending and then went on to request $62.9 billion in new mandatory funding for the so-called American Jobs Act. And while it is my understanding, Mr. Secretary, that departments were directed to disregard the possibility of sequestration in their budget requests, you should have not disregarded, maybe, economic reality. Our Nation, I believe, cannot continue to spend money we don't have. And as we work to solve the sequestration issue, it's important to remember that a resolution today does not exempt programs from constraints tomorrow. Mr. Chairman, we need to reign in Federal spending and put our Nation back on the path to fiscal sustainability. Senator Harkin. Thank you very much, Senator Shelby. Any other opening remarks received will be inserted into the record at this point. [The statement follows:] Prepared Statement of Senator Barbara A. Mikulski impact of sequestration on education Thank you, Senator Harkin, for convening this important hearing. Senator Murray, I would also like to thank you for your ongoing efforts to provide clarification, work on the impact of sequester cuts, and ensure sufficient aid is being provided to nondefense discretionary programs. Maryland is a sequester-stressed State. Apart from our Federal assets in defense, the National Security Agency and Bethesda Naval Hospital, we're also home to the National Institutes of Health (NIH), the Goddard Space Center, the Food and Drug Administration, the National Institute of Science and Health, and the National Oceanic and Atmospheric Administration. These Federal agencies, along with the employees that work there, make a significant difference in the lives of Americans on a daily basis, and those agencies will unfortunately be gutted if the sequester goes forward. First, let's talk about what a sequester means for education and the impact it would have on students and families. Federal spending in education accounts for less than 10 percent of overall spending in K through 12 education. However, the investments we do make are targeted at making a significant difference in supporting our most vulnerable populations. Our largest discretionary programs in this age group have a huge impact on kids who need the most help. Most notable of these are Title I, which helps low-income families, and the Individuals with Disabilities Education Act (IDEA), which helps more than 100,000 kids with disabilities in Maryland. And although IDEA pays for only 10 percent of the cost of special education in Maryland, in my rural counties located on the Eastern Shore and in western Maryland, where there are decreasing or seasonal populations, IDEA helps pay for more than 20 percent of special education related costs and materials. I am worried that they, and other counties, won't be able to make up for $16 million cut to special education programs with their limited county budgets. Along with Maryland's needs when it comes to education, Maryland holds a strong military presence when it comes to bases like Fort Meade and Fort Detrick, Andrews Air Force Base, and Naval Air Station at Patuxent. The military and civilian personnel at these bases have children who attend local schools. However, because they don't contribute to local property tax, the Federal Government gives small appropriations to districts intended for meeting the needs of military students. With cuts to the Impact Aid program, districts will be forced to make up the cost of children that come from military families. In Maryland, this would mean a cut of $395,000 to a program that helps educate children who are essentially there by directive of the Federal Government. In terms of health programs, we need a balanced approach to deficit reduction that isn't a job killer and doesn't annihilate programs. An approach that helps women and children, improves education, and healthcare for American citizens. A sequester means that most discretionary Department of Health and Human Services programs will be hammered with a 7.8-percent budget cut on January 2, 2013. NIH will be hit hard along with efforts to combat waste and fraud. Along with these startling possibilities, sequestration will delay biomedical innovation. 325,000 researchers at 3,000 universities and companies could face cuts, along with a $2 billion cut to NIH's budget and a $186 million cut for the State of Maryland. This not only hurts patients but also hinders the discovery of new cures, eliminating 2,300 research grants and financial support of clinical trials. NIH biomedical research investments means fewer bench-to-bedside discoveries that top Maryland biotech companies will develop into lifesaving drugs and diagnostics, some of which help with detecting cancer and infectious diseases early and ensures patients get efficient care. Mothers, infants, and children will lose access to critical healthcare and social services when maternal and child health programs are cut by $1 billion, a potentially devastating blow to kid's growth and development. Patients will experience the disastrous effects of sequestration for years to come because of cuts, ultimately limiting kid's access to Children's Hospital Graduate Medical Education program, which trains 5,600 pediatric residents each year. As for supplemental nutrition programs, WIC accounts for less than 0.2 percent of the Federal budget, and yet with sequestration 750,000 people will be thrown off this program that provides nutritional food to mothers and their children. I'm for fiscal discipline--not fiscal austerity, especially when it comes to investments we make in programs that assist our most vulnerable populations. Today's hearing focuses on what sequestration means for education. In a nutshell, the answer is sequestration will be disastrous. But it won't just be disastrous for education, it will be disastrous for all domestic programs; those which work to help families out of poverty, children to grow up healthy, and seniors stay in their communities. It will also be disastrous for job growth. According to the Center on Bipartisan Policy, these cuts will result in more than 1 million jobs being lost over the course of 2 years. Sequester is no way to govern, sequester is a way to fail. We must do better. Senator Harkin. We'll start with our first panel. Secretary Arne Duncan has served as Secretary of the U.S. Department of Education since 2009. He was confirmed by the U.S. Senate on Inauguration Day, January 20, 2009. Prior to his appointment as Secretary of Education, Secretary Duncan served as a chief executive officer of the Chicago Public Schools, a position to which he was appointed by Mayor Richard M. Daley from June 2001 through December 2008, becoming the longest-serving big city education superintendent in the country. Secretary Duncan graduated magna cum laude from Harvard University in 1987, majoring in sociology. He was co-captain of Harvard's basketball team and was named a first team Academic All-American. Secretary Duncan, you've been before this subcommittee many times before. We welcome you again. Your statement will be made a part of the record in its entirety, and we ask you just to please proceed as you so desire. STATEMENT OF ARNE DUNCAN, SECRETARY OF EDUCATION, DEPARTMENT OF EDUCATION Secretary Duncan. Thank you so much. I want to thank the chairman, the ranking member, and other members of the subcommittee for your support. Over the past 3 years, we have protected students at risk while investing in education reform that supports bold and courageous leadership at both the State and at the local level. And I welcome the opportunity to discuss the potential devastating impact of sequestration. We hoped that the prospect of deep, indiscriminate, across- the-board cuts would spur the Congress to take a balanced approach to deficit reduction. Obviously, so far that hasn't happened. But there is still time to act, and we remain hopeful that we can avoid these cuts. TIMEFRAME FOR SEQUESTRATION Fiscal year 2013 is a little more than 2 months away, and sequestration kicks in 3 months after that on January 2, 2013, so it's critically important that we and the American people fully understand the consequences of sequestration and take steps to avoid it now. As all of you here know, sequestration will force across- the-board budget cuts on almost every discretionary program. Education, Defense, Homeland Security, and all other Federal agencies would indiscriminately cut services that are essential to every State and community. ARBITRARY CUTS AFFECT EFFECTIVE AND INEFFECTIVE PROGRAMS The sequestration will put at risk all that we have accomplished in education and weaken programs that help children, that serve families, that send young people and adults to college, and make the middle-class American dream possible. Sequestration is absolutely the wrong way to make policy. It does not let the Congress or the administration set priorities. It attacks both ineffective and effective programs with the same blunt budget knife. SHORT-TERM FIX TO LONG-TERM BUDGET PROBLEMS Perhaps worst of all, it is another short-term fix to our long-term budget challenges. If sequestration happens, it simply means we didn't do our jobs in Washington, that we shirked our collective responsibility, and the people of America will pay the price. Essentially, we are playing chicken with the lives of the American people--our schools, communities, small businesses, farms, public safety, infrastructure, and national security. It further erodes what little faith remains in our elected leadership to put partisan politics aside and do the right thing for children and families. Clearly, it is time for the Congress to work together with the administration to create a long-term plan to reduce the deficit while simultaneously supporting the economic recovery that is underway. We have had 28 consecutive months of private-sector job growth because we have been thoughtful and ambitious in the way we balance new investments with spending cuts. Today, in fact, domestic discretionary programs are at their lowest level as a share of GDP since the Eisenhower administration. The Congress now has 5 months to work together to create a deficit reduction plan. President Obama has proposed a responsible way to do that when he submitted a plan that includes more than $4 trillion in deficit reduction. It maintains the Budget Control Act of 2011 caps, and calls for significant, yet targeted, cuts in discretionary spending. We've tightened our belts in a responsible way. Most importantly, the President's plan is a long-term fix. It will put an end to the seesaw budgeting that leaves State and local officials wondering if they can count on the Federal Government to be a partner with them on education and other vital programs. Let me begin with education. President Obama and I, and so many Members of Congress, recognize that education is the cornerstone to our economy. A good education leads to a good job and a lifetime of higher earnings. A strong educational system and a strong economy, those two things are inextricably linked. SEQUESTRATION CUTS WOULD UNDERMINE EQUITY AND REFORM Over the past 3 years, we've made investments in Race to the Top, the Investing in Innovation Fund, and other efforts to reform our schools so today's students are truly prepared to succeed in the global economy and to keep high-wage, high- skilled jobs right here in the United States. Sequestration sends a signal that the United States is backtracking on its commitment to reform and its long-standing promise to promote equity for poor children through Title I and the Individuals with Disabilities Education Act (IDEA) to support students with special needs. CUTS TO EDUCATION IMPACT MILITARY PREPAREDNESS Education is also essential for our military preparedness. A staggering 75 percent of young Americans today are unable to enlist in the military because they have either failed to graduate from high school, they have a criminal record, or they are physically unfit. And I've met with so many military leaders who recognize that the best way to address the dropout crisis is to start early and invest in early childhood education. They don't want to see cuts in Head Start, Child Care and Development Block Grants, and other programs serving children. K-12 EDUCATION IMPACT WOULD BEGIN IN FALL 2013 The biggest impact in K-12 education will be felt starting in the fall of 2013. And in a recent poll of school district leaders, the vast majority, 80 percent of them, said they would not be able to use State and local funding to replace potentially lost Federal funds. 7.8-PERCENT CUT AND SOME SPECIFIC IMPACTS Based on the Congressional Budget Office's (CBO) projection that sequestration will reduce programs by 7.8 percent, here's what we know will be at risk. TITLE I, ELEMENTARY AND SECONDARY EDUCATION ACT IMPACT First, Title I funding would be cut by $1.1 billion, cutting off funding to more than 4,000 schools serving an estimated 1.8 million disadvantaged children. The jobs of more than 15,000 teachers and teacher aides would be at risk. Students would lose access to individual instruction, afterschool programs, summer school, and other interventions that help to close achievement gaps. SPECIAL EDUCATION IMPACT Funding for special education would be reduced by $900 million. That would translate into the layoffs of more than 10,000 teachers, aides, and other staff who provide essential instruction and other support to 6.6 million children with disabilities in every one of our home States. IMPACT AID CUTS WOULD TAKE EFFECT JANUARY 2 On January 2, schools serving our military families through the Impact Aid program would have immediate cuts to their budgets. For example, the Killeen Independent School District in Texas receives about $53 million in Impact Aid and would lose $4.6 million, directly affecting 18,000 children from military families. And everyone here knows military families make so many sacrifices for our country. Their children deserve a world-class education. STUDENT LOANS IMPACT In higher education, our Department would need to slash spending on contracts to support the processing and the origination of student loans, which could cause delays that will hurt students as they make those critical decisions about college and could reduce services for borrowers seeking to repay their loans. OTHER FEDERAL AGENCY CUTS ALSO IMPACT EDUCATION In addition to these cuts at our department, other agencies will be forced to reduce spending in ways that will slow our Nation's educational progress. HEAD START PROGRAM IMPACT Up to almost 100,000 low-income children would be denied access to the Head Start program, which is critical to preparing them for success in kindergarten and in life. Eighty thousand children would lose access to high-quality childcare through the Child Care Development Block Grants. NATIONAL INSTITUTES OF HEALTH AND NATIONAL SCIENCE FOUNDATION IMPACT The National Institutes of Health (NIH) would issue 700 fewer grants to medical researchers, slowing the progress in the search for treatments and cures to cancer, diabetes, Alzheimer's, and other diseases in research labs at hospitals and universities across the country. And up to 1,500 grants would be cut from the National Science Foundation (NSF). SEQUESTRATION SHOULD BE AVOIDED While it is absolutely our hope and intention to avoid sequestration, our Department, along with all other agencies, will be ready to implement cuts if sequestration happens. But we all know that there are steps we can take now so we don't have to start down the path that would put so many critical services to students, families, and communities at risk. Sequestration does not have to happen, and it should not happen. PREPARED STATEMENT President Obama and all of us on his team stand ready to work with you to create a long-term path to reduce the deficit while investing in the programs that will secure our country's economic prosperity and global leadership. Together, let's do the right thing. Thank you so much. I'm happy to take any questions you might have. [The statement follows:] Prepared Statement of Arne Duncan Mr. Chairman and members of the subcommittee, thank you for this opportunity to talk about the impact on America's students and teachers of a sequestration of fiscal year 2013 funds under the Budget Control Act of 2011. That act created a bipartisan Joint Select Committee charged with developing a plan for comprehensive deficit reduction, in order to avoid the prospect of deep and indiscriminate across-the-board cuts in Federal spending, including both defense and nondefense programs. We all hoped that the breadth and depth of these prospective cuts would spur the Joint Committee to complete its task, through a balanced approach to deficit reduction, and stave off the blind and damaging cuts that would result from sequestration. Unfortunately, the Joint Committee did not succeed in coming up with a deficit reduction plan, and our day of fiscal reckoning is drawing near. President Obama has been clear that the Congress must avoid sequestration by passing a balanced measure that includes at least as much deficit reduction as the $1.2 trillion that was required of the Joint Committee by the Budget Control Act of 2011. The President's fiscal year 2013 budget contains such a balanced proposal, and we will continue to work with the members of this subcommittee as well as others in the Congress to pursue legislation that would implement the President's proposal and cancel sequestration. There would still be deficit reduction but not the mindless and harmful across-the-board cuts that could be required by sequestration. With the beginning of fiscal year 2013 just around the corner and no sign of meaningful progress toward a deficit reduction agreement, we can no longer afford to ignore the dire impact of sequestration. As you will hear from others at today's hearing, the public is appropriately worried about sequestration, and both the business community and State and local governments--including our school districts and institutions of higher education--are now posing questions about what sequestration could mean for their students, teachers, and faculty and how to plan for this possibility. In this context, and since there is both uncertainty and some misinformation regarding how sequestration would work and the impact that it could have, we think it will be helpful to outline, in broad terms, how the Department of Education and, by implication, the Federal Government as a whole, would implement a sequestration of fiscal year 2013 funds. congressional budget office estimate of sequestration impact The Congressional Budget Office (CBO) has estimated that sequestration would require a 7.8-percent reduction in funding for nondefense discretionary programs that are subject to the sequester under the Budget Control Act of 2011. The cuts would be applied to the funding levels available in fiscal year 2013, with most reductions coming from fiscal year 2013 appropriations bills, which have not yet been enacted. The administration believes that such a large, across-the-board reduction in spending would be extremely harmful. This should not come as a surprise because sequestration, by design, is bad policy. The resulting deep cuts carry the very real threat of significant harm to the ongoing economic recovery and our current and future competitiveness in the global economy. It's also important to note that even without sequestration, domestic discretionary spending has already been declining. Nonsecurity discretionary spending is now on a path to reach its lowest level as a share of gross domestic product (GDP) since the Eisenhower administration. In addition, State and local spending has been cut due to the recent financial crisis and economic downturn. At a time when we are just starting to see signs of renewed economic growth, as well as the positive impact of historic education reforms in programs like Race to the Top and School Improvement Grants that will contribute to future growth and prosperity, it just makes no sense at all to undermine this progress through sequestration of Federal funds. The long-term impact of sequestration could be even more damaging, as it would jeopardize our Nation's ability to develop and support an educated, skilled workforce that can compete in the global economy. Indeed, it would be hard to overstate the devastating impact of sequestration as a signal not just to the Nation but to the world, that we are no longer able or willing to prioritize investment in the best guarantee of our future success and prosperity: The education of our children. Before I talk about some specific examples of how sequestration would affect Federal education programs, I want to clarify that because four of our largest elementary and secondary programs are forward- funded, most cuts in funding resulting from sequestration next January would not hit classrooms until the 2013-2014 school year. Most Federal support for education in the 2012-2013 school year is funded through the fiscal year 2012 appropriation, which would be unaffected by sequestration. This means that if sequestration occurs, States and school districts would have roughly the first one-half of next year to plan for the impact of reduced Federal funding beginning in the 2013- 2014 school year. We have communicated this information in a letter to Chief State School Officers from Deputy Secretary Tony Miller. impact on state formula grant programs However, I want to be clear that the delay in impact does not make the prospect of sequestration any less harmful to students, families, teachers, or schools: A recent poll showed that 80 percent of school districts would not be able to make up the funding lost to sequestration. And the effect of the funding lost would be significant. For example, a 7.8-percent reduction in funding for large State-formula grant programs that serve more than 21 million students in high-poverty schools and 6.6 million students with special needs could force States, school districts, and schools to lay off teachers and reduce services to these needy children. More specifically, a $1.1 billion reduction to title I could mean cutting off funding to more than 4,000 schools serving more than 1.8 million disadvantaged students, and more than 15,000 teachers and aides could lose their jobs. Similarly, for the critical Part B Grants to States program under the Individuals with Disabilities Education Act (IDEA), a 7.8-percent reduction in funding would mean the loss of more than $900 million, eliminating Federal support for about 11,000 special education teachers, aides, and other staff providing essential instruction and other support to children with disabilities. impact on student aid administration Another area where students, families, and schools would feel the impact of sequestration is in the administration of Federal student aid. A cut to Student Aid Administration could affect the processing of the Free Applications for Federal Student Aid (FAFSA), which millions of students and families use to apply for postsecondary student financial assistance. Our student aid contractors would likely have to lay off or furlough many of the contract employees who work for the Department in States with contractor facilities--such as Alabama, Arizona, Georgia, Iowa, New Mexico, and New York--that provide customer services to students and borrowers. This could mean that many students would not receive financial aid determinations and awards in time to make enrollment decisions. In addition, students who do enroll could experience delays in the processing and origination of Federal student loans, since the Department also could be forced to slash spending on contracts that support these essential activities. And the Department could be hampered in its ability to collect student debt and provide quality services to borrowers once they are out of school, due to cuts in the contracts with the private-sector entities that service Federal student loans. Just to be clear about the magnitude of the risks here, during the 2011-2012 award year the Department delivered or supported the delivery of approximately $172 billion in grant, work-study, and loan assistance to almost 15 million postsecondary students attending more than 6,000 postsecondary institutions. In addition, since the Department would likely need to furlough many of its own employees as well, sequestration would significantly harm the Department's ability to prevent fraud, waste, and abuse in these very large, complex student financial assistance programs. immediate effect on impact aid and vocational rehabilitation It is also important to point out that the impact of sequestration would not be delayed until the 2013-2014 school year for all Federal education programs. Sequestration would have a more immediate effect on individuals and schools served through programs like Impact Aid and the Vocational Rehabilitation (VR) State Grants, which are not forward- funded. The $1.2 billion Impact Aid Basic Support Payments program would lose almost $90 million under sequestration, a significant blow in the middle of the school year for districts that serve federally connected children, including military dependents and Native American students. For example, in Texas, the Killeen Independent School District receives about $53 million in Impact Aid support for 23,000 federally connected children--including 18,000 military dependents--who make up one-half of the student population in the district. Sequestration would cut Killeen's Impact Aid payment by more than $4.6 million. The Gallup-McKinley County Public Schools in Gallup, New Mexico, receives about $35 million from the Impact Aid program, or about 35 percent of the district's total budget, to help meet the needs of 7,500 federally connected children, including 6,700 students who live on Indian lands. Sequestration would result in a mid-year cut of more than $3 million to Gallup-McKinley's Impact Aid payment. In the VR State Grants program, sequestration would require an immediate reduction of approximately $240 million for activities that help about 1 million individuals with disabilities at any given time to prepare for, obtain, or retain employment. Sequestration of VR funding would likely result in higher-counselor caseloads and increased wait times for individuals to receive essential services. At a time when the unemployment rate for people with disabilities is significantly higher than the general population, this cut would be devastating. While it is our hope and intention that we avoid sequestration, the Department of Education, along with all other agencies, will be prepared to implement sequestration if necessary. Reductions of this magnitude in critical Federal education programs would betray our longstanding commitment to improving educational opportunity for the neediest students and their families, and are absolutely the wrong way to address our Nation's fiscal challenges. Support for disadvantaged elementary and secondary students in high-poverty schools; efforts to turn around thousands of low-performing schools, including so-called ``dropout factories'' that help put nearly a million teenagers a year at risk of social failure and a lifetime of poverty; programs that help students and adults with disabilities meet educational and independent living goals; work-study jobs for college students, many of them first- generation college students--all would be put at risk by sequestration. I hope you will agree that sequestration is no way to achieve our shared goal of fiscal responsibility, and no way to set priorities for Federal spending, either in education or any other area of the Federal budget. I also hope that this hearing will help to jumpstart renewed discussions, both here in the Congress and outside the beltway, on how we can work together to achieve comprehensive deficit reduction while continuing to make the investments we need to safeguard our people and our future. Thank you, and I will be happy to take any questions you may have. EFFECT ON EDUCATION IF DEFENSE IS MADE EXEMPT Senator Harkin. Thank you very much, Mr. Secretary. We'll start a series of 5-minute questions. Mr. Secretary, there's been a lot of discussion about the impact of sequestration on national security. Senators have been going to the floor talking about it. I understand there's a road trip planned. But I guess, I have to say that isn't education, and isn't a highly skilled workforce important to our security, too? Let me just elaborate a little bit on that. Some have suggested that Defense alone should be exempt from sequestration. I'm not sure that people realize that if we exempt defense alone, the entire burden for finding the $1.2 trillion in cuts would fall on, basically, this subcommittee. Mr. Secretary, you just described the devastating impact of a 7.8-percent cut to education. But if nondefense programs alone had to bear the brunt of it, and defense is exempted from sequestration, then the cut would not be 7.8 percent but more like 17.6 percent. So instead of 15,000 Title I teachers that are laid off, more than 34,000 would lose their jobs; instead of 96,000 students losing Head Start services, the figure would be more like 217,000. So can you give us just a sense, in your own mind, what this would mean for our Nation's education system and our national security? Secretary Duncan. It's staggering to think what that impact would be. And we're at a time when, Mr. Chairman, we have to get better educationally faster than ever before. If you look at any of the international rankings in reading and math and other things, we're somewhere between 15th and 30th, depending on the metric. We are 16th in the world in college graduation rates. We have a 25-percent dropout rate in this country. None of those facts are acceptable. We have to again lead the world in college graduation rates. If we have devastating cuts in early childhood education, in K-12 reform, in access to higher education, we are absolutely cutting off our nose to spite our face. I always say I think a strong military is about defense. I think a strong public education system, strong education system, is about defense and about global competitiveness, about economic security, and about keeping great jobs in this country. And if we fail to make the investments, I worry gravely about what that means for our Nation's future. Senator Harkin. I am on the Defense Appropriations Subcommittee. I spent a good part of my life in the military. And it seems that the military of today and of the future is going to be much more highly technical, much more requiring our troops to be more highly educated and highly trained. And it's not like the Army of even when I was there 30, 40 years ago. And so doesn't this also mean that we have to think about the military of the future and what we're doing today in our educational system? So that we have the individuals who know how to operate the systems that we're going to rely on in the future? I've had so many military people tell me that, that they're having a hard time finding qualified young men and women that can actually fill those kinds of slots. Secretary Duncan. That's exactly right, and you have outside groups like the Council on Foreign Relations, which recently had a task force co-chaired by Condoleezza Rice. And in their report, they argue that educational failure in the United States puts future economic prosperity, global position, and our Nation's physical safety at risk. So the stakes here are extraordinary. Senator Harkin. Thank you, Mr. Secretary. I yield to Senator Shelby. CONGRESSIONAL BUDGET OFFICE ESTIMATES--BASIS FOR PROJECTED EDUCATION CUTS Senator Shelby. Mr. Secretary, before we can make meaningful decisions, we need to understand the full scope of the issue, don't we, on just about anything? Secretary Duncan. Yes, Sir. Senator Shelby. Why has your Department not provided sequestration information to the subcommittee? Secretary Duncan. We're happy to provide all the information. I think the chairman put out a report today that looks at the numbers briefly. The numbers seem to basically correspond to where we are. And any additional information you would like from us, we're happy to provide. But our estimates are based upon a 7.8-percent across-the- board cut, so the math here is, frankly, not that difficult. Senator Shelby. Are you working with OMB in getting to these numbers you're talking about? Secretary Duncan. We got these numbers from CBO. Senator Shelby. CBO. Secretary Duncan. Yes. Senator Shelby. Okay. And they're helpful on this regard? Secretary Duncan. Yes. And again, to be clear, whether it's 7.8 percent or 7.9 percent, I think the point is these cuts would be absolutely devastating. So there's no good answer here. PRIORITIES ASSUMING CUTS Senator Shelby. What would be your priorities, assuming that you're going to have to cut things in the future? And we all believe we're going to have to do some of that. What would be several of the areas that you believe you--you don't want to cut, I understand that, but if you had to cut, what would---- Secretary Duncan. To be very clear, we tried to hold ourselves accountable. We've made tough cuts. We have eliminated 49 programs. We've created annual savings of $1.2 billion. I have a lengthy list of programs that we have cut that we felt were ineffective. Again, no one enjoys making those cuts, but we're all asked to make hard decisions. And we would absolutely continue to do that and expect you to hold us accountable for that. We have 49 programs here that we eliminated--and some were politically difficult to eliminate, because we want to use taxpayer dollars wisely. EDUCATION BUDGET AN INVESTMENT IN THE FUTURE Senator Shelby. But are the programs, the money that we appropriate in the Government's borrowing--in other words, your spending each year is going up. It's not going down, correct? Secretary Duncan. Well, we think, the President believes, that education is an investment. Senator Shelby. We understand. Secretary Duncan. And so we need to invest in quality early childhood education. We need to invest in K-12 reform. We need to make college more accessible and affordable. The fact that we're 16th in the world in college graduation rates is nothing to be proud of, and we want to again lead the world. Now, money alone is never the answer, as you know, but we have to continue to invest in reform. PELL GRANT EXEMPT FROM SEQUESTRATION Senator Shelby. It is my understanding that the Pell grant program is predicted to need an additional $6 billion next year, and it remains unclear whether the Pell grant is exempt from sequestration. What's your judgment on that? Secretary Duncan. We think the Pell grant is exempt. Senator Shelby. Is exempt. Secretary Duncan. Yes, Sir. Senator Shelby. Do you believe it's in the best interest of this country to try to deal with our fiscal challenges now or kick the can down the road? Secretary Duncan. Now, Sir. Senator Shelby. Okay. That's what we're trying to do. Thank you, Mr. Chairman. Senator Harkin. Thank you. I just might add that, a year ago in April, I went down to the United States Chamber of Commerce. Their affiliate had issued a report calling for more investment in this country in early childhood education. This is the U.S. Chamber of Commerce calling upon us not to cut but to invest more in early childhood education. I have an order of arrival. I have Senator Murray, Senator Reed, Senator Brown, Senator Mikulski, Senator Durbin, Senator Pryor. Senator Murray. Senator Murray. Thank you very much, Chairman Harkin and Ranking Member Shelby, for holding this hearing. I think it's really important that we learn more about the impact of these automatic cuts on our students and our families across the country. As the chairman mentioned, sequestration was included in the bipartisan Budget Control Act of 2011 in order to give both parties an incentive to compromise. And the goal really was to bring both sides to the table, willing to make concessions that were required to get to a balanced and bipartisan deal. JOINT SUBCOMMITTEE ON DEFICIT REDUCTION Unfortunately, as we all know, it hasn't worked out yet. We haven't been able to get to that deal. As you know, I served as chair of that Joint Subcommittee on Deficit Reduction, and what I saw firsthand was that, on our side, we were willing to put some pretty tough concessions on the table when it came to cutting budgets and entitlements. But what we were not able to get was a comparable concession on the other side that included revenue from the wealthiest Americans to help pay for what this country needs to be strong both in defense and in nondefense moving forward. Everybody wanted all the deficit from sequestration but without any of the shared sacrifice that is really needed to come to a deal. And, on our side, we were not going to throw the middle class under the bus if we did not have that balance and bipartisan deal. We weren't willing to do it then, and I think that's still true today. In fact, I know it's still true today. So we have to keep working to replace sequestration. No one wants sequestration to happen, but that replacement has to be bipartisan, it has to be balanced, and it is going to have to be fair for the middle class in this country who have suffered so much. DAMAGING IMPACT ON FAMILIES AND COMMUNITIES So, here in the District of Columbia, now we're hearing a lot about the defense side of the equation, and it's getting a lot of attention. But I think it's really important, Mr. Chairman, that Americans do understand the deeply damaging impact to families and communities on the nondefense side as well. About 3,000 national, State, and local organizations signed a letter that they sent to the Congress. I have it with me and I would like to submit it for the record, Mr. Chairman, urging us to adopt that balanced approach onto deficit reduction that does protect middle-class families and the most vulnerable Americans. So I would submit that for the record. [The information follows:] July 12, 2012 Dear Member of Congress: There is bipartisan agreement that sequestration would be devastating to the nation. The nearly 3,000 undersigned national, state, and local organizations--representing the hundreds of millions of Americans who support and benefit from nondefense discretionary (NDD) programs--couldn't agree more. Congress and the President must work together to ensure sequestration does not take effect. We strongly urge a balanced approach to deficit reduction that does not include further cuts to NDD programs, which have already done their part to reduce the deficit. NDD programs are core functions government provides for the benefit of all, including medical and scientific research; education and job training; infrastructure; public safety and law enforcement; public health; weather monitoring and environmental protection; natural and cultural resources; housing and social services; and international relations. Every day these programs support economic growth and strengthen the safety and security of every American in every state and community across the nation. NDD programs represent a small and shrinking share of the Federal budget and of our overall economy. The NDD budget represented just 3.4 percent of our country's Gross Domestic Product (GDP) in 2011, consistent with historical levels. Under the bi-partisan Budget Control Act, by 2021 NDD funding will decline to just 2.5 percent of GDP, the lowest level in at least 50 years. NDD programs are not the reason behind our growing debt. In fact, even completely eliminating all NDD programs would still not balance the budget. Yet NDD programs have borne the brunt of deficit reduction efforts. --Since fiscal 2010, NDD programs have been cut by 10 percent on average, with many programs cut by as much as 50 percent. --By 2021, the remaining discretionary caps (2013-2021) in the bipartisan Budget Control Act will reduce NDD programs by an additional 7 percent, relative to 2012 levels. --If sequestration is allowed to take effect, nonexempt NDD programs will be reduced by another 8.4 percent in fiscal year 2013. In total, if Congress and the President fail to act, between fiscal 2010 and 2021 NDD programs will have been cut by 20 percent overall. Such indiscriminate cuts threaten the entire range of bipartisan national priorities. For example, there will be fewer scientific and technological innovations, fewer teachers in classrooms, fewer job opportunities, fewer National Park visitor hours, fewer air traffic controllers, fewer food and drug inspectors, and fewer first responders. America's day-to-day security requires more than military might. NDD programs support our economy, drive our global competitiveness, and provide an environment where all Americans may lead healthy, productive lives. Only a balanced approach to deficit reduction can restore fiscal stability, and NDD has done its part. Please work together to find a balanced approach to deficit reduction that does not include further cuts to NDD programs. If you have questions about this letter, please contact Emily Holubowich, Executive Director of the Coalition for Health Funding (202-484-1100 or [email protected]) or Joel Packer, Executive Director of the Committee for Education Funding (202-383-0083 or [email protected]). An electronic copy of this letter is also available at http://publichealthfunding.org/index.php/action/campaigns/ ndd_united/. national organizations (listed alphabetically) 8th Day Center for Justice 9to5, National Association of Working Women A World Fit For Kids! Academic Pediatric Association Academy of Medical Surgical Nurses Academy of Nutrition and Dietetics Academy of Radiology Research AcademyHealth ACCESS Ad Hoc Group for Medical Research Adult Congenital Heart Association Advocates for Youth African American Health Alliance African American Ministers in Action AFSE Afterschool Alliance AIDS Community Research Initiative of America AIDS Healthcare Foundation AIDS Treatment News AIDS United Alliance for a Just Society Alliance for Aging Research Alliance for Biking & Walking Alliance for Children and Families Alliance for Retired Americans Alpha-1 Association Alpha-1 Foundation Alzheimer's Association Alzheimer's Foundation of America American Academy of Child and Adolescent Psychiatry American Academy of Family Physicians American Academy of Neurology American Academy of Nursing American Academy of Pediatrics American Alliance for Health, Physical Education, Recreation and Dance American Art Therapy Association American Association for Adult and Continuing Education American Association for Cancer Research American Association for Dental Research American Association for Geriatric Psychiatry American Association for Health Education American Association for Marriage & Family Therapy American Association for Psychoanalysis in Clinical Social Work American Association for the Advancement of Science American Association for the Study of Liver Diseases American Association of Classified School Employees American Association of Colleges for Teacher Education American Association of Colleges of Nursing American Association of Colleges of Osteopathic Medicine American Association of Colleges of Pharmacy American Association of Community Colleges (AACC) American Association of Community Theatre American Association of Critical-Care Nurses (AACN) American Association of Physics Teachers American Association of Poison Control Centers American Association of Port Authorities American Association of Radon Scientists and Technologists American Association of School Administrators American Association of School Librarians American Association of Service Coordinators American Association of State Colleges and Universities American Association of University Professors American Association of University Women (AAUW) American Association on Health and Disability American Astronomical Society American Brain Coalition American Cancer Society Cancer Action Network American Chemical Society American College of Clinical Pharmacy (ACCP) American College of Preventive Medicine American Council on Education American Council on the Teaching of Foreign Languages (ACTFL) American Counseling Association American Dental Education Association American Diabetes Association American Educational Research Association American Epilepsy Society American Federation for Medical Research American Federation of School Administrators, AFL-CIO American Federation of Teachers, AFL-CIO American Forests American Geophysical Union American Heart Association American Institute of Biological Sciences American Library Association American Lung Association American Mathematical Society American Medical Rehabilitation Providers Association American Medical Student Association American Music Therapy Association American Nephrology Nurses' Association American Nurses Association American Occupational Therapy Association American Organization of Nurse Executives American Pediatric Society/Society for Pediatric Research American Physical Therapy Association American Planning Association American Psychiatric Association American Psychological Association American Public Health Association American Rivers American School Counselor Association American Social Health Association American Society for Bone and Mineral Research American Society for Clinical Pathology American Society for Engineering Education American Society for Microbiology American Society for Pharmacology & Experimental Therapeutics American Society of Agronomy American Society of Hematology American Society of Nephrology American Society of Pediatric Nephrology American Society of PeriAnesthesia Nurses (ASPAN) American Society of Plant Biologists American Society of Tropical Medicine and Hygiene American Society on Aging American Sociological Association American Speech-Language-Hearing Association American Statistical Association American Therapeutic Recreation Association American Thrombosis and Hemostasis Network American Urogynecologic Society Americans for Nursing Shortage Relief (ANSR) Alliance Americans for the Arts America's Service Commissions amfAR, The Foundation for AIDS Research Amputee Coalition Arthritis Foundation Asian & Pacific Islander American Health Forum Asian & Pacific Islander Institute on Domestic Violence Asian & Pacific Islander Wellness Center Asian American Justice Center, Member of Asian American Center for Advancing Justice Associated Universities, Inc. Association for Ambulatory Behavioral Healthcare Association for Career and Technical Education Association for Prevention Teaching and Research Association for Psychological Science Association for Radiologic & Imaging Nurses (ARIN) Association for Research in Otolaryngology Association for Research in Vision and Ophthalmology Association for Women in Mathematics Association of Academic Health Centers Association of Academic Health Sciences Libraries Association of Ambulatory Behavioral Healthcare Association of American Cancer Institutes Association of American Medical Colleges Association of American Universities Association of American Veterinary Medical Colleges Association of Assistive Technology Act Programs (ATAP) Association of BellTel Retirees, Inc. Association of Departments of Family Medicine Association of Educational Service Agencies Association of Environmental & Engineering Geologists Association of Family Medicine Residency Directors Association of Farmworker Opportunity Programs Association of Jesuit Colleges and Universities (AJCU) Association of Jewish Aging Association of Maternal and Child Health Programs Association of Medical School Pediatric Department Chairs Association of Minority Health Professions Schools Association of Nurses in AIDS Care Association of Prosecuting Attorneys Association of Public and Land-grant Universities Association of Public Health Nurses Association of Rehabilitation Nurses Association of Research Libraries Association of School Business Officials International Association of School Psychologists Association of Schools and Colleges of Optometry Association of State & Territorial Public Health Nutrition Directors Association of State and Territorial Health Officials Association of Teacher Educators Association of University Centers on Disabilities Association of Women's Health, Obstetric and Neonatal Nurses Asthma and Allergy Foundation of America Attention Deficit Disorder Association (ADDA) Autism National Committee Bat Conservation International Bazelon Center for Mental Health Law Be the Change, Inc. Benetech Benign Essential Blepharospasm Research Foundation Berkeley Media Studies Group Biophysical Society Brain Injury Association of America Bread for the World Break the Cycle Briar Cliff University TRIO Upward Bound Building Educated Leaders for Life (BELL) Business Industrial Network California Institute of Technology Campaign for Public Health Foundation Campaign for Youth Justice Campaign to Invest in America's Workforce Campus Compact CARE Casa de Esperanza: National Latin@ Network for Healthy Families and Communities C-Change Center for Biological Diversity Center for Employment Training Center for HIV Law and Policy Center for Law and Social Policy (CLASP) Center for Science in the Public Interest Center for Women Policy Studies Cerebral Palsy International Research Foundation Charles R. Drew University Child Care Services Association Child Welfare League of America Children and Adults with Attention-Deficit/Hyperactivity Disorder Children's Defense Fund Children's Environmental Health Network Children's HealthWatch Children's Leadership Council Children's Mental Health Network Christopher & Dana Reeve Foundation Citizen Schools Citizens United for Rehabilitation of Errants--Women Incarcerated City Year Clean Water Action CLEARCorps USA Climate Change is Elementary Clinical Social Work Association Coalition for a Secure Driver's License Coalition for Health Funding Coalition on Human Needs Coalition for Imaging and Bioengineering Research Coalition for Juvenile Justice Coalition for Workforce Solutions Coalition of Higher Education Assistance Organizations Coalition to End Childhood Lead Poisoning Coastal States Organization College Board College Summit Colleges That Change Lives Commission on Adult Basic Education (COABE) Commissioned Officers Association of the U.S. Public Health Service Committee for Education Funding Communities Advocating Emergency AIDS Relief (CAEAR) Coalition Community Action Partnership Community Anti-Drug Coalitions of America Community Economic Development Partners, LLC Conference of Educational Administrators of Schools and Programs for the Deaf Consortium for Citizens with Disabilities Consortium for Ocean Leadership Consortium for School Networking Consortium of Social Science Associations Cooley's Anemia Foundation COPD Foundation Corporate Hepatitis Alliance Corporation for a Skilled Workforce Corporation for Supportive Housing Council for Adult and Experiential Learning Council for Advancement of Adult Education Council for Exceptional Children Council for Opportunity in Education Council of Administrators of Special Education, Inc. (CASE) Council of State and Territorial Epidemiologists Council of State Community Development Agencies Council of the Great City Schools Council on Social Work Education Covenant House International Crohn's and Colitis Foundation of America Crop Science Society of America Defeat Diabetes Foundation Defenders of Wildlife Dermatology Nurses Association Digestive Disease National Coalition Directors of Health Promotion and Education Disability Rights Education & Defense Fund District 1199C Training & Upgrading Fund Division for Early Childhood of the Council for Exceptional Children (DEC) Drugs for Neglected Diseases initiative (DNDi) Dystonia Advocacy Network Dystonia Medical Research Foundation Early Care and Education Consortium Earth Day Network Earthquake Engineering Research Institute Easter Seals Ecological Society of America Education Industry Association Education Law Center Educational Talent Search Educational Theatre Association Elderly Housing Development and Operations Corporation (EHDOC) Emergency Nurses Association Endangered Species Coalition Enterprise Community Partners, Inc. Epilepsy Foundation Equal Justice Works Evangelical Lutheran Church in America (ELCA) Every Child By Two--Carter/Bumpers Champions for Immunization FairTest: National Center for Fair & Open Testing, Inc. Families USA Family Caregiver Alliance Family Promise of Lycoming County Fanconi Anemia Research Fund Federal Law Enforcement Officers Association Federation of Associations in Behavioral & Brain Sciences Federation of Materials Societies Fellowship Health Resources, Inc. Fight Colorectal Cancer First Focus Campaign for Children Food Research & Action Center (FRAC) Foster Family-Based Treatment Association Franklin County Head Start Fred Hutchinson Cancer Research Center Friends Committee on National Legislation Friends of the Earth Friends of Agency for Healthcare Research and Quality Friends of National Center for Health Statistics Friends of the National Institute of Child Health and Human Development (NICHD) Friends of UNFPA Futures Without Violence (formerly Family Violence Prevention Fund) Gay Men's Health Crisis Gay, Lesbian & Straight Education Network (GLSEN) Genetics Policy Institute Goodwill Industries of the Valleys Gray Panthers Greenpeace Half in Ten Harm Reduction Coalition Health & Disability Advocates Health Professions and Nursing Education Coalition Healthcare Leadership Council HealthHIV Heifer International Helen Keller International Hemophilia Federation of America Hepatitis B Foundation HIGH IMPACT Mission-based Consulting & Training Higher Education Consortium for Special Education HighScope Educational Research Foundation HIV Law Project HIV Medicine Association (HIVMA) HIV Prevention Justice Alliance Human Rights Campaign Human Rights Project for Girls iCAST (International Center for Appropriate & Sustainable Technology) Idea Fuel IDEA Infant Toddler Coordinators Association (ITCA) Illinois Campus Compact Infectious Diseases Society of America Innocence Project Innovate+Educate Innovations in Civic Participation Insight Center for Community Economic Development Institute for Educational Leadership International Association of Jewish Vocational Services (IAJVS) International Certification and Reciprocity Consortium (IC&RC) International Essential Tremor Foundation International Foundation for Functional Gastrointestinal Disorders International Myeloma Foundation International Reading Association International Society for Technology in Education Interstitial Cystitis Association Iron Disorders Institute Jeffrey Modell Foundation Jewish Council for Public Affairs Jewish Labor Committee Jobs for the Future (JFF) Joint Advocacy Coalition of ACRT, APOR, CRF, and SCTS Juma Ventures Jumpstart KaBOOM! Knowledge Alliance Leadership Conference on Civil and Human Rights League of Conservation Voters Learning Disabilities Association of America Legal Action Center Legal Momentum Local Initiative Support Corporation Long-term Ecological Research Network Lupus Foundation of America, Inc. Lupus Research Institute Lutheran Services in America Magnet Schools of America Mal de Debarquement Syndrome Balance Disorder Foundation Manufactured Home Owners Association of America March of Dimes Marie Stopes International--US (MSI-US) Marine Conservation Institute Materials Research Society Mathematical Association of America Meals On Wheels Association of America Medical Library Association Meharry Medical College Mental Health America Mercy Housing, Inc. Mesothelioma Applied Research Foundation Metro TeenAIDS Mexican American Legal Defense and Educational Fund Military Impacted Schools Association Monarch Housing Associates Morehouse School of Medicine NAACP NAADAC--The Association for Addiction Professionals NAfME: National Association for Music Education NAFSA: Association of International Educators National Academy of Elder Law Attorneys National Advocacy Center of the Sisters of the Good Shepherd National African American Drug Policy Coalition, Inc. National AIDS Housing Coalition National Alliance for Eye and Vision Research National Alliance for Media Arts & Culture National Alliance of Black School Educators National Alliance of Community Economic Development Associations (NACEDA) National Alliance of State & Territorial AIDS Directors National Alliance on Mental Illness National Alliance to End Homelessness National Alliance to End Sexual Violence National Area Health Education Center (AHEC) Organization National Assembly on School-Based Health Care National Association for Bilingual Education National Association for Biomedical Research National Association for Children's Behavioral Health National Association for College Admission Counseling National Association for County Community and Economic Development National Association for Geriatric Education and National Association of Geriatric Education Centers National Association for Hispanic Elderly National Association for Music Education National Association for Public Health Statistics and Information Systems National Association for Rural Mental Health National Association for Sport and Physical Education National Association for the Education of Homeless Children and Youth National Association for the Education of Young Children National Association of Area Agencies on Aging National Association of Chronic Disease Directors National Association of Clinical Nurse Specialists National Association of Community Health Centers National Association of Councils on Developmental Disabilities National Association of County and City Health Officials National Association of County Behavioral Health and Developmental Disabilities Directors (NACBHDD) National Association of Development Organizations (NADO) National Association of Drug Court Professionals National Association of Elementary School Principals National Association of Federally Impacted Schools National Association of Housing Cooperatives National Association of Human Rights Workers National Association of Local Housing Finance Agencies National Association of Marine Laboratories National Association of Nutrition and Aging Services Programs (NANASP) National Association of People with AIDS (NAPWA) National Association of Private Special Education Centers National Association of Professional Geriatric Care Managers National Association of Pupil Services Administrators National Association of Rural Mental Health National Association of School Nurses National Association of School Psychologists National Association of Secondary School Principals National Association of Social Workers (NASW) National Association of State Alcohol and Drug Abuse Directors National Association of State Directors of Career Technical Education Consortium National Association of State Directors of Special Education National Association of State Emergency Medical Services Officials National Association of State Head Injury Administrators National Association of State Long-Term Care Ombudsman Programs (NASOP) National Association of State Mental Health Program Directors National Association of States United for Aging and Disabilities National Association of Thrift Savings Plan Participants National Association of Workforce Boards (NAWB) National Association of Workforce Development Professionals (NAWDP) National Black Nurses Association National Center for Healthy Housing National Center for Technological Literacy National Center for Transgender Equality National Center for Victims of Crime National Center on Domestic and Sexual Violence National Coalition Against Domestic Violence National Coalition for Literacy National Coalition for Promoting Physical Activity National Coalition of STD Directors National Community Development Association National Community Reinvestment Coalition National Community Tax Coalition National Congress of American Indians National Consumer Voice for Quality Long-Term Care National Council for Advanced Manufacturing National Council for Community and Education Partnerships (NCCEP) National Council for Community Behavioral Healthcare National Council for Workforce Education National Council of Jewish Women National Council of La Raza National Council of State Directors of Adult Education National Council of State Housing Agencies National Council of Women's Organizations National Council on Aging National Council on Independent Living National Disability Rights Network National Ecological Observatory Network, Inc. (NEON) National Education Association National Education Association Student Program National Employment Law Project National Estuarine Research Reserve Association National Fair Housing Alliance National Family Planning & Reproductive Health Association National Federation of Families for Children's Mental Health National Forum for Heart Disease and Stroke Prevention National Fragile X Foundation National Fund for Workforce Solutions (NFWS) National Head Start Association National Health Care for the Homeless Council National Healthy Start Association National Health Care for the Homeless National Hemophilia Foundation National High School Equivalency Program/College Assistance Migrant Program Association National Hispanic Council on Aging National Hispanic Media Coalition National Hispanic Medical Association National Housing Law Project National Housing Trust National Human Services Assembly National Immigration Law Center National Juvenile Justice Network National Kidney Foundation National Latina Institute for Reproductive Health National Latino Alliance for the Elimination of Domestic Violence (Alianza) National Latino Behavioral Health Association National Law Center on Homelessness & Poverty National League for Nursing National Low Income Housing Coalition National Lung Cancer Partnership National Marfan Foundation National Marine Sanctuary Foundation National Minority AIDS Council National Multiple Sclerosis Society National Network for Youth National Network of Public Health Institutes National Network of Sector Partners (NNSP) National Network to End Domestic Violence National Organization of Social Security Claimants' Representatives National Parks Conservation Association National Partnership for Women & Families National Partnership to End Interpersonal Violence National Pediatric AIDS Network National Psoriasis Foundation National PTA National Resource Center on Domestic Violence National Rural Education Advocacy Coalition National Rural Education Association National School Boards Association National Senior Corps Association National Skills Coalition National Spasmodic Dysphonia Association National Spasmodic Torticollis Association National Student Nurses' Association, Inc. National Summer Learning Association National Superintendents Roundtable National Task Force to End Sexual and Domestic Violence National Title I Association National Tourette Syndrome Association National Transitional Jobs Network (NTJN) National Trust for Historic Preservation National Urban League National Violence Prevention Network National Viral Hepatitis Roundtable National WIC Association National Women's Conference Committee National Women's Health Network National Women's Law Center National Writing Project National Youth Employment Coalition (NYEC) National Youth Leadership Council Natural Resources Defense Council Nemours NephCure Foundation New Leaders North American Primary Care Research Group Nurse-Family Partnership Nurses Organization of Veterans Affairs Oceana Oncology Nursing Society Pancreatic Cancer Action Network (PanCAN) Parents As Teachers Parkinson's Action Network Peace Action Pediatric Stroke Network, Inc. People For the American Way PFLAG National (Parents, Families and Friends of Lesbians and Gays) Planned Parenthood Federation of America Points of Light Population Action International Population Association of America/Association of Population Centers Population Connection Population Institute Positive Education, Inc. Prevent Blindness America Preventive Cardiovascular Nurses Association Professional Association of Social Workers in HIV and AIDS Project Inform ProLiteracy Provincial Council of the Clerics of St. Viator (Viatorians) Public Allies, Inc. Public Education Network Public Health Foundation Public Health Institute Public Health Solutions Public Lands Service Coalition Pulmonary Hypertension Association Racial and Ethnic Health Disparities Coalition Racine County Older Adult Nutrition Program Rape, Abuse & Incest National Network (RAINN) Reading Partners Research Allies for Lifelong Learning Research!America Resources for Human Development, Inc. Restore America's Estuaries RESULTS Robert F. Kennedy Children's Action Corps Rose F. Kennedy University Center for Excellence in Developmental Disabilities RTI International Rushmere Community Development Corporation Ryan White Medical Providers Coalition Safe States Alliance Sargent Shriver National Center on Poverty Law Save the Children School Social Work Association of America Scleroderma Foundation Scripps Institution of Oceanography Sea Grant Association Southwest Educational Development Laboratory (SEDL) Senior Service America, Inc. Services and Advocacy for GLBT Elders (SAGE) Sexuality Information and Education Council of the United States (SIECUS) Sisters of Charity of Nazareth Congregational Leadership Sisters of Mercy of the Americas Sjogren's Syndrome Foundation Sleep Research Society Society for Advancement of Violence and Injury Research Society for Healthcare Epidemiology of America Society for Industrial and Applied Mathematics Society for Medical Decision Making Society for Neuroscience Society for Public Health Education Society for Women's Health Research Society of General Internal Medicine Society of Gynecologic Oncology Society of Teachers of Family Medicine Society of Urologic Nurses and Associates Soil Science Society of America Southeast Asia Resource Action Center Special Olympics, Inc. Spina Bifida Association Stand Up for Rural America State Educational Technology Directors Association Stem Cell Action Coalition Strategic Applications International STRIVE National Student Conservation Association Sugar Law Center for Economic & Social Justice Teach For America Teaching Strategies, LLC Technical Assistance Collaborative Telecare Corporation TESOL International Association The Advocacy Institute The AIDS Institute The American Society for Cell Biology The Arc of the U.S. The Aspen Institute Workforce Strategies Initiative The Borgen Project The Center for the Celebration of Creation The Coalition for the Life Sciences The Community Builders, Inc. The Corps Network The Education Trust The Eisen Group The Endocrine Society The Every Child Matters Education Fund The Gerontological Society of America The Imani Project The Myelin Project The National Center for Learning Disabilities The National Center on Family Homelessness The National Crittenton Foundation The National Indian Head Start Directors Association The Polycystic Kidney Disease Foundation The Salvation Army The United Methodist Church The Wilderness Society Treatment Action Group Treatment Communities of America Treatment Systems Development Trust for America's Health Tufts University Tuskegee University's College of Veterinary Medicine, Nursing, and Allied Health U.S. Water Fitness Association U.S. Positive Women's Network U.S. Soccer Foundation Union for Reform Judaism Unite 2 Fight Paralysis United Cerebral Palsy United Church of Christ United Church of Christ Justice and Witness Ministries United for Medical Research United Neighborhood Centers of America United Spinal Association United States Breastfeeding Committee UNITY, Society for the Advancement of Violence & Injury Research Universities Research Association, Inc. University Corporation for Atmospheric Research U.S. Climate Action Network U.S. Hereditary Angioedema Association USAction VALUEUSA Vasculitis Foundation Vera Institute of Justice Voices for America's Children Voices for National Service Voices for Progress W. Haywood Burns Institute WestEd Wider Opportunities for Women (WOW) Women Employed Women in Film WomenHeart: The National Coalition for Women with Heart Disease Women's Action for New Directions Wonderlic, Inc. Woodhull Sexual Freedom Alliance Workforce Learning Strategies World Education, Inc. World Wildlife Fund Young Invincibles YouthBuild USA YWCA USA ZERO TO THREE regional, state, and local organizations (listed alphabetically, by state) Alabama AIDS Alabama, Birmingham Alabama Association for Career and Technical Education, Montgomery Alabama Association of Secondary School Principals, Montgomery Alabama Council of Administrators in Special Education, Guntersville Alabama Disability Advocacy Program, University of Alabama, Tuscaloosa Alabama School Counselor Association, Montgomery Alabama Disabilities Advocacy Program, Tuscaloosa Auburn Housing Authority, Auburn Eastside Mental Health, Birmingham Learning Disabilities Association of Alabama, Montgomery Low Income Housing Coalition of Alabama, Birmingham National Alliance on Mental Illness (NAMI) Shoals, Florence Southwest Alabama Behavioral Healthcare Systems, Monroeville The Concerned Citizens of Atmore ``Unity in the Community,'' Atmore Unity Wellness Center Housing Department, Auburn VOICES for Alabama's Children, Montgomery YWCA Central Alabama, Birmingham Alaska Akeela Development Corporation, Anchorage Alaska Association of Secondary School Principals, Fairbanks Alaska Council of Administrators of Special Education, Fairbanks Alaska Occupational Therapy Association, Anchorage Cook Inlet Housing Authority, Anchorage Denali Family Services, Anchorage Disability Law Center of Alaska, Anchorage Kawerak, Inc., Nome Kenai Peninsula Food Bank, Soldotna Kenai Senior Services, Kenai Southeast Alaska Regional Health Consortium (SEARHC), Juneau University of Alaska Anchorage, Center for Human Development, Anchorage American Samoa American Samoa Office of Protection & Advocacy for the Disabled, Pago Pago Arizona Arizona Association for Lifelong Learning, Phoenix Arizona Center for Disability Law, Tucson Arizona Council of Administrators of Special Education, Phoenix Arizona Housing Alliance, Phoenix Arizona Justice Project, Phoenix Arizona School Counselors Association, Sahuarita Arizona State Impact Aid Association, Sacaton Arizona Institute for Peace, Education, and Research, Tempe Association for Career and Technical Education of Arizona (ACTEAZ), Tucson Association for Supportive Child Care, Tempe Association of Arizona Food Banks, Phoenix Blackwater Enterprises, Rdc, Higley Booker T. Washington Child Development Center, Inc., Phoenix Cedar Unified School District, Keams Canyon Cocopah Head Start, Somerton Community Intervention Associates, Inc., Yuma Compass Affordable Housing, Tucson Cornucopia Community Advocates, Sedona Early Head Start, Littlefield Fellowship Square Tucson, Tucson Fort Thomas Unified School District, Fort Thomas Foundation for Senior Living, Phoenix Holbrook Unified School District #3, Holbrook Hospice Family Care, Inc., Prescott Housing America Corporation, Somerton Local Initiative Support Corporation Phoenix, Phoenix Mayer Elders Club, dba Mayer Area Meals on Wheels, Mayer McDowell Healthcare Center, Phoenix Old Pueblo Community Services, Tucson Our Family Services, Tucson Peach Springs USD #8, Peach Springs Pinal County Public Health Services District, Florence Prescott Meals on Wheels, Prescott Sacaton Elementary School District #118, Sacaton Teens, Training and Taxes, Parks Tuba City Unified School District #15, Tuba City Tucson Planning Council for the Homeless, Tucson United Food Bank, Mesa Valley Interfaith Project, Sun City Whiteriver Unified School District, Whiteriver Unified School District Window Rock Unified School District No. 8, Fort Defiance Yarnell Senior Community Center, Yarnell Arkansas Area Agency on Aging of Southeast Arkansas, Inc., Pine Bluff Arkansas Advocates for Children and Families, Little Rock Arkansas Association of Secondary School Principals, Springdale Arkansas Association of Student Assistance Programs, Fayetteville Arkansas Council of Administrators in Special Education, North Little Rock Arkansas Education Association, Little Rock Arkansas Federation of Families for Children's Mental Health (AFFCMH), Little Rock Disability Rights Center of Arkansas, Little Rock Family Violence Prevention, Inc., Batesville Henderson State University, Arkadelphia Little Angels Childcare, Prescott Little Rock Community Mental Health Center, Little Rock Pinon Unified School District #4, Pinon National Alliance on Mental Illness (NAMI) Arkansas, Springdale Affiliate, Siloam Springs Universal Housing Development Corporation, Russellville California Advocates for Peace and Justice, Irvine United Congregational Church, Irvine Affordable Housing Network of Santa Clara County, San Jose Age Well Senior Services, Inc., Laguna Woods AIDS Legal Referral Panel of San Francisco, San Francisco AIDS Project Los Angeles, Los Angeles Armona Union Elementary School District, Armona Association of California School Administrators, Sacramento California Association of Alcohol and Drug Abuse Counselors (CAADAC), Sacramento California Center for Public Health Advocacy, Davis California Coalition for Rural Housing, Sacramento California Community Colleges Chancellor's Office, Sacramento California Council of Administrators of Special Education (CA CASE), Santa Rosa California Council of Community Mental Health Agencies, Sacramento California Department of Public Health, Sacramento California Hepatitis Alliance, San Francisco California Housing Partnership, San Francisco California Innocence Project, San Diego California Lutheran University, Thousand Oaks California Small School Districts' Association, Sacramento California Teachers Association, Burlingame California WIC Association, Sacramento California Workforce Investment Board, Sacramento California Association for Micro Enterprise Opportunity (CAMEO), San Francisco Central Union Elementary School District, Lemoore Children Now, Oakland Children's Defense Fund-California, Oakland Church of All, Burbank Citizen Schools California, Redwood City Community Action Napa Valley, Napa Community Action Partnership Food Bank of San Bernardino County, San Bernardino Community Action Partnership of San Luis Obispo County, Inc., San Luis Obispo Community Research Foundation, San Diego Council of University of California Faculty Associations, Berkeley Desert Manna, Barstow Disability Rights California, Sacramento Disability Services & Legal Center, Santa Rosa East Bay Housing Organizations, Oakland Epilepsy Foundation of Northern California, San Francisco Fair Housing Council of Central California, Fresno Fair Housing of Marin, San Rafael First Baptist Church Head Start, Pittsburg Foundation for Successful Solutions, Los Angeles Fresno County EOC Head Start, Fresno HIV ACCESS, Alameda County Housing Authority of the City of Calexico (HACC), Calexico Housing Authority of the City of Santa Barbara, Santa Barbara Housing Authority of the City of Upland, Upland Housing California, Sacramento Housing Rights Committee of San Francisco, San Francisco Independent Living Resource Center San Francisco, San Francisco Interdisciplinary Leadership Education in Neurodevelopmental and Related Disabilities Training Program (CA-LEND), Los Angeles Irvine Meals on Wheels, Irvine Jewish Labor Committee Western Region, Los Angeles Kalusugan (Good Health) Community Services, National City Kings County Charter--Association of California School Administrators, Hanford Kings County Office of Education, Hanford Kings River-Hardwick Elementary School District, Hanford KyotoUSA, Berkeley Lake Family Resource Center, Kelseyville Lakeside Union Elementary School District, Hanford Lemoore Union High School District, Lemoore Lincoln Child Center, Oakland Local Child Care Planning Council, Oroville Local Government Commission, Sacramento Local Initiatives Support Corporation Bay Area, San Francisco Local Initiatives Support Corporation Los Angeles, Los Angeles Local Initiatives Support Corporation San Diego, San Diego Los Angeles Area Chamber of Commerce, Los Angeles Los Angeles Unified School District (LAUSD), Los Angeles Meals-on-Wheels Greater San Diego, Inc., San Diego Mending Wheel, Fortuna Mental Health America of California, Sacramento Mexican American Opportunity Foundation, Montebello Mizell Senior Center, Palm Springs Momentum for Mental Health, San Jose Monterey County Health Department WIC Program, Salinas Muroc Joint Unified School District, Edwards Napa Valley Community Housing, Napa National Alliance on Mental Illness (NAMI) Yolo County, Davis National Council of Jewish Women, Contra Costa Section, Walnut Creek National Council of Jewish Women, Long Beach Section, Huntington Beach National Council of Jewish Women, Los Angeles National Council of Jewish Women, Sacramento National Council of Jewish Women, Topanga New Life Advocacy, Los Angeles Northern California Innocence Project, Santa Clara University School of Law, Santa Clara Oceanside Unified School District, Oceanside Oldtimers Housing Development Corporation--IV, Huntington Park Pacific Asian Consortium in Employment (PACE), Los Angeles Parent Voices El Dorado County Chapter, South Lake Tahoe Parent Voices Southern Alameda County, Hayward Parents' Place Family Resource and Empowerment Center, West Covina Peninsula Volunteers Inc, Menlo Park Portia Bell Hume Behavioral Health and Training Center, Concord PowerWorks, San Francisco Project Sister Family Services, Pomona RESULTS Domestic, Los Angeles Sacramento Housing Alliance, Sacramento San Diego Housing Federation, San Diego San Fernando Valley Community Mental Health Center, Inc, Van Nuys San Gaberial Valley/Whittier Chapter of NOW, Fontana San Mateo County HIV Program Community Board, San Mateo County Santa Cruz Community Counseling Center Head Start, Santa Cruz Senior Network Services, Santa Cruz Senior Services Coalition of Alameda County, Oakland Shasta Senior Nutrition Programs, Redding Sierra Cascade Family Opportunities Head Start, Susanville Sierra Cascade Family Opportunities, Inc., Quincy Sierra Senior Providers, Inc., Sonora Silver Valley Unified School District, Yermo SRO Housing Corporation, Los Angeles State of California Office of AIDS Surveillance Section, Fresno Stop the GA Cuts Coalition, Oakland Tarjan Center at UCLA, Los Angeles The Non-Profit Housing Association of Northern California, San Francisco The Occupational Training Institute, Foothill-De Anza Community College District, Cupertino The Public Interest Law Project, Oakland The Wall Las Memorias Project, Los Angeles Time for Change Foundation, San Bernardino United Administrators of San Francisco, San Francisco University of California (U.C.) Riverside Faculty Association, Riverside University of California (U.C.) Berkeley Faculty Association, Berkeley University of California at Davis Faculty Association, Davis University of California Santa Cruz Faculty Association, Santa Cruz University of Southern California School of Pharmacy Violence Prevention Coalition of Greater Los Angeles, Los Angeles Volunteers of America Los Angeles, Los Angeles Watts/Century Latino Organization, Los Angeles Westside Progressives, Los Angeles Women Organized to Respond to Life-threatening Diseases (WORLD), Oakland Rural Community Assistance Corporation, West Sacramento Colorado Academy School District #20, Colorado Springs Adams County School District #14, Commerce City Adams County Workforce and Business Center, Brighton Boulder County Network, Boulder Colorado Association for Career and Technical Education, Denver Colorado Association of School Executives, Englewood Colorado Campus Compact, Denver Colorado Center on Law and Policy, Denver Colorado Chapter of ASPIRE, Denver Colorado Children's Campaign, Denver Colorado Education Association, Denver Colorado School Counselor Association, Denver Colorado School Social Work Association, Fort Collins Colorado Thespians--Educational Theatre Association, Denver Colorado Urban Workforce Alliance, Denver Community Reach Center, Thornton Community Strategies Institute, Denver Denver's Great Kids Head Start, Denver Federation of Families for Children's Mental Health, Colorado Chapter, Denver FRESC: Good Jobs, Strong Communities, Denver Healthy Colorado Youth Alliance, Denver Housing Resources of Western Colorado, Grand Junction Ignacio School District 11JT, Ignacio LeaderQuest, Denver Mental Health America of Colorado, Denver Occupational Therapy Association of Colorado, Denver Occupy Greeley, Greeley Public Allies at Eagle Rock School, Estes Park Regis University, Denver Rocky Mountain Wild, Denver Servicios de La Raza, Inc., Denver Sexual Assault Response Advocates (S.A.R.A)., Inc., Fort Morgan Southern Ute Indian Tribe, Ignacio The Bell Policy Center, Denver The Legal Center for People with Disabilities and Older People, Denver The Pendulum Foundation, Denver Connecticut 1199NE Training and Upgrade Fund, Hartford All Our Kin, Inc., New Haven BHcare, Ansonia Bridgeport Council of Administrators and Supervisors, Bridgeport Center for Latino Progress--CPRF, Hartford Collaborative Center for Justice, Inc., Hartford Connecticut AIDS Resource Coalition, Hartford Connecticut Association of Directors of Health, Hartford Connecticut Association of School Psychologists, Bridgeport Connecticut Association of School Social Workers (CASSW), New Haven Connecticut Association of Schools, Cheshire Connecticut Community College System, Hartford Connecticut Education Association, Hartford Connecticut Federation of School Administrators, Cromwell Connecticut Food Bank, East Haven Connecticut Housing Coalition, Wethersfield Connecticut Voices for Children, New Haven Connecticut Women's Education and Legal Fund (CWEALF), Hartford Eastern Highlands Health District, Storrs Family Services of Greater Waterbury, Waterbury FSW, Bridgeport Gilead Community Services, Middletown Holy Family Home and Shelter, Inc., Willimantic LAMPP Project- Connecticut Children's Medical Center, Hartford Local Initiatives Support Corporation, Hartford National Alliance on Mental Illness (NAMI) Farmington Valley, Avon Norwich School Administrator's Association, Norwich Our Piece of the Pie, Hartford Public Assisted Housing Resident Network (PHRN), Norwalk Region 16 Administrators Association, Prospect Regional School District 16, Prospect Saint Francis Hospital and Medical Center, Hartford Sexual Assault Crisis Center of Eastern CT, Inc., Willimantic St. Philip House, Plainville University of Connecticut A.J. Pappanikou Center for Excellence in Developmental Disabilities Education, Research and Service, Farmington Village for Families and Children, Hartford Wellmore Behavioral Health, Waterbury Woodland Regional High School, Beacon Falls Delaware Delaware Association of School Psychologists, Wilmington Delaware State Education Association, Dover Epilepsy Foundation of Delaware, Wilmington Ministry of Caring, Inc., Wilmington District of Columbia Clearinghouse on Women's Issues Council of School Officers, American Federation of School Administrators, Local 4, AFL-CIOD.C. D.C. Behavioral Health Association D.C. LEARNs D.C. Coalition Against Domestic Violence Defeat Poverty D.C. District of Columbia Occupational Therapy Association Edward C. Mazique Parent Child Center, Inc. Georgetown University Center for Excellence in Developmental Disabilities (UCEDD) Georgetown Center for Poverty, Inequality and Public Policy Georgetown University Medical Center Living Wages Adult Education Program Local Initiatives Support Corporation Washington, D.C. National Association of Local Housing Finance Agencies Potomac Gardens Resident Council Public Allies Washington, D.C. RESULTS D.C. Volunteer Group United Way of the National Capital Area Florida 1000 Friends of Florida, Tallahassee Ability Housing of Northeast Florida, Inc., Jacksonville Adult and Community Educators of Florida, Inc., Tallahassee Bond Community Health Center, Inc., Tallahassee Broward Meals on Wheels, Fort Lauderdale Catholic Charities Housing, Diocese of Venice, Inc., Sarasota/Venice Center for Independent Living of South Florida, Inc., Miami Children's Forum, Tallahassee Christian Coalition Against Domestic Abuse, Miami City of Deerfield Beach, Deerfield Beach Coalition for Independent Living Options, West Palm Beach Community Coalition on Homelessness, Bradenton Community Enterprise Investments Inc., Pensacola Community Justice Project--Florida Legal Services, Miami Dab the AIDS Bear Project, Oakland Park Daytona State College, Daytona Beach Department of Community Development, Miami Depression and Bipolar Support Alliance (DBSA), St. Cloud disAbility Solutions for Independent Living, Inc., Daytona Beach Documents International, St. Petersburg Dunbar Center, Inc., Hobe Sound Epilepsy Foundation of Florida, Miami Familias Latinas Dejando Huellas, Tampa Farmworker Association of Florida, Apopka Florida Alliance of Community Development Corporations, Inc., Jacksonville Florida Alliance for Health, Physical Education, Recreation, Dance and Sport, Parkland Florida CASE, Archer Florida Center for Fiscal and Economic Policy, Tallahassee Florida Education Association, Tallahassee Florida HIV/AIDS Advocacy Network, Oakland Park Florida HIV/AIDS Patient Care Planning Group, Freeport Florida School Counselor Association, Safety Harbor Florida Supportive Housing Coalition, Tallahassee Fusion, Wilton Manors Gay Free If You Want To Be, Clearwater Heart of Putnam Coalition, Palatka Helen B. Bentley Family Health Center, Miami Homes in Partnership, Inc., Apopka Hope and Help Center of Central Florida, Inc., Orlando Housing and Homeless Assistance Program, North Miami Innocence Project of Florida, Tallahassee Life Management Center of Northwest Florida, Panama City Local Initiatives Support Corporation, Jacksonville Meals on Wheels, Etc., Sanford Miami Coalition for the Homeless, Inc., Miami National Alliance on Mental Illness (NAMI) & Depression and Bipolar Support Alliance, Lakeland National Council of Jewish Woman Miami, Miami National Council of Jewish Women Aventura, Aventura National Council of Jewish Women Greater Miami Section, Miami National Council of Jewish Women Hollywood, Hollywood National Council of Jewish Women Southeast Atlantic Section, Boca Raton Neighborly Care Network, Inc., Clearwater North Florida Educational Development Corporation, Gretna Northwest Florida AIDS/HIV Consortium (NOFLAC), Brent Planned Parenthood of South Florida and the Treasure Coast, West Palm Beach Positive Champions Speakers Bureau, Daytona Beach Positively U, Inc., Davenport Rural Neighborhoods, Inc., Homestead Sanford Housing Authority Agency-Wide Resident Council, Sarasota South Florida Community Development Coalition, Miami St. Johns County Council on Aging, St. Augustine St. Johns River Alliance, Jacksonville Beach Sugarloaf Women's Land Trust, Sugarloaf Key Suncoast Partnership to End Homelessness, Sarasota Tampa Housing Authority, Tampa The Florida Housing Coalition, Tallahassee The Good Shepherd of North East Florida, Inc., Lake City The Mental Health Association of Okaloosa/Walton Counties, Fort Walton Beach United Faculty of Florida, Tallahassee Georgia AID Gwinnett/Ric Crawford Clinic, Duluth Armstrong Atlantic State University (AASU), Savannah Augusta Housing Authority, Augusta BAIN, Inc. Center for Independent Living, Bainbridge Center for Leadership in Disability, Atlanta DEW Consultants, Inc., Roswell Douglas County Homeless Shelter, Douglasville East Point Housing Authority, East Point Epilepsy Foundation of Georgia, Atlanta Families First, Inc., Atlanta Family Visions Outreach, Inc., Sylvester G-CASE, McDonough Georgia Alliance to End Homelessness, Marietta Georgia Association of Secondary School Principals, Thomasville Georgia Council of Administrators for Special Education, McDonough Georgia Parent Support Network, Inc., Atlanta Georgia School Counselors Association, Marietta Georgia State University Center for Leadership in Disability, Atlanta Georgia Supportive Housing Association, Atlanta Grady Health System, Atlanta Here's to Life, Inc., Decatur HOPE Atlanta Programs of Travelers Aid, Atlanta Housing Authority of DeKalb County, Decatur Liberty County Board of Education, Hinesville Liberty County Public School System, Hinesville Lou Walker Senior Center, Lithonia Northwest Georgia Federation of Families, Rome Peak Performance Learning, L.L.C., Atlanta Sexual Assault Support Center, Inc., Columbus SisterLove, Inc., Atlanta Sisters of Mercy, Macon South Fulton Senior Services, College Park STEM, Inc., Covington The Cottage, Sexual Assault Center & Children's Advocacy Center, Athens Urban Residential Development Corporation, Atlanta Briarcliff Oaks, Atlanta Guam University of Guam Center for Excellence in Developmental Disabilities (UCEDD), Mangilao Hawaii Community Alliance for Mental Health, Honolulu Good Beginnings Alliance, Honolulu Hawaii Association of Secondary School Administrators, Honolulu Hawaii Association of School Librarians, Honolulu Hawaii County Economic Opportunity Council, Hilo Hawaii Policy Advisory Board for Elder Affairs, Honolulu Hawaii State Council on Developmental Disabilities, Honolulu Hawaii State Department of Education, Honolulu Hawaii State Office of Youth Services, Honolulu Hawaii State Teachers Association, Honolulu Lanakila Pacific, Honolulu Learning Disabilities Association of Hawaii, Honolulu Iowa Black Hawk-Grundy Mental Health Center, Inc., Waterloo Chickasaw County Public Health and Home Care Services, New Hampton Child and Family Policy Center, Des Moines Community Health Partners of Sioux County, Orange City Crisis Intervention Services, Oskaloosa Disability Rights Iowa, Des Moines Dubuque Franciscan Sisters, Dubuque Heritage Area Agency on Aging, Cedar Rapids Iowa Association for College Admission Counseling, Newton Iowa Association of Community Providers, Urbandale Iowa Coalition 4 Juvenile Justice, Des Moines Iowa Comprehensive Human Services, Des Moines Iowa Council of Administrators of Special Education I-CASE, Des Moines Iowa Federation of Families for Children's Mental Health, Anamosa Iowa School Social Work Association, Des Moines Jackson County Home and Community Health, Maquoketa Kirkwood Community College, Cedar Rapids Lincoln Mental Health, Fort Dodge Monona County Public Health, Onawa North Fayette High School, West Union PITCH, Milford Positive Iowans Taking Charge, Des Moines Siouxland District Health Department, Sioux City Sisters of the Presentation, Dubuque State Public Policy Group Inc., Des Moines The Culture Buzz, Des Moines Tri-County Child and Family Development Council, Inc., Waterloo United Way of Central Iowa, Des Moines Waubonsie Mental Health Center, Clarinda Idaho Aberdeen Education Association, Aberdeen Boise State University, Boise Buhl Education Association, Buhl Cambridge-Midvale Senior Citizens Center, Cambridge Cassia County Education Association, Burley Castleford School District, Castleford Challis Education Association, Challis Coeur d'Alene Education Association, Coeur d'Alene Family Crisis Center, Rexburg Filer Education Organization, Filer Gem County Education Association, Emmett Idaho Association of School Administrators, Boise Idaho CASE, Boise Idaho Council for Exceptional Children, Boise Idaho Council on Developmental Disabilities, Boise Idaho Education Association, Boise Idaho Education Association, Coeur d'Alene Idaho Education Association, Post Falls Idaho Federation of Families for Children's Mental Health, Boise Kimberly Education Association, Kimberly Lakeland Education Association, Rathdrum Meadows Valley Education Association, New Meadows Minidoka County Education Association, Rupert Plummer-Worley Jt School District #44, Plummer Post Falls Educational Association, Post Falls Richfield IEA, Richfield Rimrock Senior Center, Grand View Ririe Education Association, Ririe Rockland Education Association, Rockland Teton Education Association, Felt The New Meadows Senior Center, New Meadows Twin Falls Education Association, Twin Falls Twin Falls School District, Twin Falls Valley Meals on Wheels, Lewiston West Ridge Elementary, Post Falls Illinois ACTE, Springfield Aging Care Connections, La Grange AIDS Foundation of Chicago, Chicago AIDS Legal Council of Chicago, Chicago Alexian Brothers AIDS Ministry, Chicago Burr Ridge Community Consolidated School District #180, Burr Ridge Calumet Area Industrial Commission, Chicago Campaign for Better Health Care, Illinois, Champaign and Chicago Canticle Ministries, Wheaton Career Link, Bloomington Casa Central, Chicago Cass School District #63, Darien Central Illinois Friends of People with AIDS, Peoria Chicago Jobs Council, Chicago Chicago Rehab Network, Chicago Chicago Workforce Investment Council, Chicago Children's Home and Aid, Chicago Citizen Schools Illinois, Chicago City of Chicago Department of Family & Support Services, Chicago City of Kankakee Community Development Agency, Kankakee Coalition for Equitable Community Development, Chicago Community Behavioral Healthcare Association of Illinois, Springfield Community Outreach Intervention Projects, SPH, UIC, Chicago Connect 2 Protect Chicago, Chicago Connections for Abused Women and their Children, Chicago Cook County GED Testing Program, Chicago Department of Human Services, Woodstock DuPage Senior Citizens Council, DuPage County DuPage Workforce Board, Lisle East Central Illinois Area Agency on Aging, Bloomington Educational Support for Students in Temporary Living Situations (STLS), Chicago Egyptian Mental Health Department, Eldorado Goldie's Place, Chicago Haymarket Center, Chicago Housing Action Illinois, Chicago Housing Authority of the County of DeKalb, DeKalb Human Resources Development Institute, Inc., Chicago IACEA: The Voice of Adult Education in Illinois, Crystal Lake Illinois Association for College Admission Counseling, Mt. Prospect Illinois Association of Career Tech Educators, Rockford Illinois Association of Educational Opportunity Program Personnel, Chicago Illinois Community College Board Adult Education and Family Literacy Program, Springfield Illinois Eastern Community Colleges, Mattoon Illinois Lead Program, Springfield Illinois Maternal and Child Health Coalition, Chicago Illinois Migrant Council, Harvard Illinois Principals Association, Springfield Illinois School Counselor Association, DeKalb Illinois School Counselors Association, Chicago Illinois School Library Media Association, Canton Institute on Disability and Human Development, Chicago Interfaith Open Communities, Chicago Jewish Council on Urban Affairs, Chicago Lake County Center for Independent Living, Mundelein Lake County Workforce Investment Board, Waukegan Learning Disabilities Association of Illinois, Chicago Lifescape Community Services, Inc., Rockford Living Daylight Corporation, Elgin Local Initiatives Support Corporation Chicago, Chicago Local Initiatives Support Corporation Peoria, Peoria Manufacturing Technology Institute, Richard J. 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Johnsbury Bennington County Head Start, Bennington Brattleboro Area Affordable Housing, Brattleboro Brattleboro Housing Authority, Brattleboro Central Vermont Council on Aging, Barre Champlain Housing Trust, Burlington Chelsea Area Senior Citizen's Center, Chelsea Department of Economic Housing & Community Development, Montpelier Franklin Central Supervisory Union, St. Albans Galley Senior Meals Program, Barre Greater Northfield Senior Citizens, Inc., Northfield Hunger Free Vermont, South Burlington Lamoille North Supervisory Union, Hyde Park Lamoille South Supervisory Union, Morrisville, Stowe, Elmore North Country Schools Supervisory Union, Newport City Northgate Residents' Ownership Corporation, Burlington Safe Kids Addison County, Vergennes Sexual Assault Crisis Team, Barre South Royalton Area Senior Citizen's Center, South Royalton Twin Valley Seniors, Inc., Marshfield United Counseling Service of Bennington County, Bennington Vermont Adult Learning, Waterbury Vermont Affordable 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Principals, Laramie Wyoming Children's Action Alliance, Cheyenne Wyoming Coalition for the Homeless, Cheyenne Wyoming Occupational Therapy Association, Casper Wyoming Protection & Advocacy System, Inc., Cheyenne Wyoming School Counselors Association, Worland Senator Murray. And those organizations are very, very concerned about the domestic side and the impact on our country. Everybody believes sequestration is a terrible thing. We cannot let it happen. We have to come up with a balanced proposal, one that we all know has to include something from both sides, including revenue from the wealthiest Americans. They have to be willing to participate in this and pay their fair share. So I think the answer is in front of us. It's just going to take the political will from both sides to say that we know that's what we need to do. IMPACT OF SEQUESTRATION ON U.S. COMPETITIVENESS But I do think, Mr. Secretary, we have to focus on our economic competitiveness. You talked about it in your opening statement. And I think the investments that we make are absolutely crucial to our country recovering from this recession and creating jobs that are so important. And I wanted to ask you today what you think that sequestration coupled with the appropriations for education and the reductions in spending that we have been seeing will have on the effect of our competitiveness. Secretary Duncan. So I worry tremendously today that, in tough economic times, we have 2 million at least, I think, 2 million high-wage, high-skilled jobs that are unfilled. And I can't tell you how many Chief Executive Officers (CEOs) that I've met with and the President's met with who say we're trying to hire right now, and we can't find the employees with the skills that we're looking for. I think we, in education, have to look ourselves in the mirror and be very self-critical and say we have to do a much better job. CEOs want to keep those jobs here. They want to hire. They want to keep their companies in the United States. But they're going to go to where the knowledgeable workers are, and that's going to be right here or that's going to be India, China, South Korea, or Singapore. And so, for me, this fight is about so much more than education. It is absolutely about economic competitiveness. And if we think being 16th in the world or 20th in the world in college graduation rates is going to lead to a strong economy, I just fundamentally reject that. If we can again lead the world in college graduation rates, then I become very hopeful about our economic competitiveness and having a lower unemployment rate. So these two things I said earlier are just absolutely inextricably linked. You can't separate them out. We have to educate our way to a stronger economy. FOREIGN COUNTRIES INCREASING THEIR COMPETITIVENESS Senator Murray. What about those countries that are nipping at our heels, China and India, South Korea? Are they increasing or decreasing their investments in education? Secretary Duncan. Senator, they are not scaling back, I would say. It's not like folks are waiting around for us to pass them by. These guys are innovating. They're creative. They're putting more resources behind this. They're doing things at a scale and with a sense of urgency that I think stuns people here. And I'm spending more and more of my time with my international counterparts, because that's where the competition is. And anyone who thinks that the rest of the world is going to stand idly by and watch us try and catch up fundamentally doesn't understand how seriously these countries are taking their need to educate, to innovate, to be creative, to be entrepreneurial. And our competition is very, very strong. Senator Murray. Mr. Chairman, I think all of us should really listen to that. If we want our country to be the top in the global economic world that we live in, we're going to have to make investments just like our competitors do. And this sequestration and this budget deal that is in front of us offers us a stark choice today. We can move forward and invest, or we can just hide behind cutting, and I just do not believe that's the right way to go. BALANCED, BIPARTISAN ACTION NEEDED There is no magic to this. Revenue has to be on the table. And I hope that as more members learn about the impacts of the choices that we have in front of us that it will get us to a balanced, bipartisan, and fair deal where every American participates in our future. Thank you, Mr. Secretary, and thank you, Mr. Chairman. Senator Harkin. Thank you, Senator Murray. Senator Reed. Senator Reed. Well, thank you, Mr. Chairman. And thank you, Mr. Secretary. IMPACT OF EXEMPTING DEFENSE FROM SEQUESTRATION And I want to underscore some points that were made by the chairman and by Senator Murray. First of all, we have already made $1 trillion in cuts to discretionary spending as a way to begin to approach the deficit. And as the chairman pointed out, we're at the lowest percentage of discretionary spending since the 1950s. So the issue of out-of-control spending has to be put in the context of deep cuts already and the lowest percentage of discretionary spending for all of these programs in 60 years. But the point, I think, the chairman made is very well taken, which is when you listen to our Republican colleagues, they're talking about exempting defense, they're talking about no revenue, which means that the 7.8-percent cut you're talking about is probably closer to 15 percent. And the worst-case plans that are frightening at this moment become absolutely horrible. SEQUESTER'S IMPACT ON ALREADY TIGHT STATE/LOCAL BUDGETS But the point I want to make, Mr. Secretary, is that when you get down to the education situation, at the local level, they're already suffering. States are also trying to deal with this dilemma. So we will be doubling down on our cuts at a time when States and localities are facing similarly difficult cuts. Can you give us the context from both those convergent local pressures and a huge, in fact, doubling probably, doubling down of cuts? Secretary Duncan. It's a great point. And as I talked to educators who have been in the business, who have been working with children for 10, 20, 30, 40 years, many from across the country say this is the toughest economic climate that they have ever worked in, more constrained in resources. We were thrilled that the American Recovery and Reinvestment Act (ARRA) saved a couple of hundred thousand jobs, but we also lost a couple hundred thousand jobs across this country. And with class size going up; after-school programs being eliminated; some school districts going to 4-day weeks rather than 5-day weeks; art, dance, drama, music, physical education going away; early childhood cutbacks; none of these things are good for children or good for education or ultimately good for our country. So you're exactly right. In the midst of a very, very tough economic time, 40 States, last year, 80 percent of the country--Republican, Democrat--40 States cut funding to higher education. Again, we're trying to lead the world in college graduation rates. That doesn't help us get where we need to go. So at the early childhood level, the K-12 level, at the higher education level, these are very, very, very difficult economic times. And to compound those challenges, to compound those difficulties, is inconceivable to me. Senator Reed. In effect, you know, what we're doing is not only in the short run shedding a significant number of jobs. I don't have the exact numbers, but we've seen private employment grow consistently over the last several years under the President's program. But what we've seen after ARRA was exhausted is public sector employment shrink dramatically, particularly in education, and that would accelerate, presumably, if these cuts went through and moreover were doubled because we've exempted defense. Secretary Duncan. Yes. IMPORTANT TO MAINTAIN CURRENT REFORM EFFORTS Senator Reed. So in the short run, you lose jobs, which means the economy continues to languish. But in the longer run, I think all of your efforts, the Race to the Top, commendable efforts, all of your tough calls about how do we reform education, will be lost. And rather than sort of trying to catch up with China, India, et cetera, we'll fall, in your view, let me ask you, further and further behind? Secretary Duncan. I think that's exactly right. And again, at a time when we have to get better, faster, despite the tough economic times, we can't afford to go in the opposite direction. We can't afford to do that. COMPETITIVENESS IMPORTANT TO NATIONAL SECURITY Senator Reed. Just a final point, as my colleagues have pointed out, Secretary Rice, as you pointed out, Secretary Rice, military leaders, everyone talks about how this is now a global competition for the best-educated people in the world. If we lose that competition, then our fundamental sort of foundation of national security will quickly erode. And we won't invent the new technologies. We won't have the sophisticated military and associated personnel to use it. And essentially, not just in terms of national security, but in terms of the fabric of our country, it will deteriorate. Secretary Duncan. That's exactly right. I'll just quickly add, Mr. Chairman, that I know our children are as talented, as creative, as entrepreneurial, as innovative, as children anywhere in the world. I just want to level the playing field for that. I just want to give them a chance to fulfill their potential. And if we fail to give them the chance to fulfill their academic and social potential, shame on us. Senator Reed. Thank you, Mr. Secretary. Senator Harkin. Thank you, Senator Reed. Senator Brown. Senator Mikulski. IMPACT OF SEQUESTER ON SCHOOL REFORM Senator Mikulski. Mr. Chairman, thank you, and thanks for holding this hearing to really highlight what a sequester means, because there's a lot of chest pounding going on about the impact on defense, but it's really the impact on our economy both today and in the future. Mr. Secretary, I want to ask you a question about the impact of sequester on reform. You know, in my own home State of Maryland, we boast a State that wins Blue Ribbon Schools, Nobel Prizes, and has one of the greatest land grant colleges, the University of Maryland, and an iconic institution like Johns Hopkins University, and a Governor who's been really committed to school reform. So, I want to ask you, you came in to the administration as a reformer and you shook it up. And we've now been steadily working on reform, how to improve our educational system for the 21st century. Could you tell us, if we go to sequester, not targeted fiscal discipline initiatives but swashbuckling across departments, what will be the impact on reform both today and how you would see its impact, say, 3 to 5 years from now? Secretary Duncan. It would be a massive step backward. So everything we tried to do to drive reform would be affected, whether it's more money for early childhood education through the Race to the Top Early Learning Challenge, whether it's been Race to the Top at the State level, whether it's been school money to turn around chronically underachieving schools. We're seeing unprecedented creativity and courage from States like Maryland that's been at the forefront of this movement and from States from around the country. And they want to improve. No one is making excuses. No one is saying the status quo is good enough. But we have to be a good partner. We have to be there for them. And we have to continue to support that great leadership and creativity at the local level. And if we walk away from the table, again, we'll just see a massive step in the wrong direction. Just one quick example. We talked about the dropout rate. Our School Improvement Grants, thanks in part to them, and to other things as well, have helped, so that today, we have 700,000 fewer children enrolled in ``dropout factories'' than just a couple of years ago. Now those schools have a long way to go, but that's real progress. Do you want to see that go south, or do you want to continue to see those numbers of children going to very low performing schools, dropout factories, do you want to see those numbers continue to go down? The answer is obvious: We have to continue to drive reform. BROAD, INDISCRIMINATE IMPACT ON EDUCATION IN ALL LOCAL EDUCATION AGENCIES Senator Mikulski. So the lack of funding would impact, say, a school district like Baltimore or Prince George's County or even one of my rural school districts? Secretary Duncan. It would impact every single school district in the country. Senator Mikulski. And how would it do that? Secretary Duncan. It would result in significantly less resources across the board. So whether it be title I money, whether it be title II money, whether it be money for 21st Century Community Learning Centers, special education money, money for career and technical education, you name it, we would be forced to cut indiscriminately. So every single one of those funding streams that comes from us to State and local school districts would be cut. POTENTIAL TO UNDERMINE REFORMS ACHIEVED AND PLANNED Senator Mikulski. Do you think it would also sap the energy of reform that--I don't want to put words in your mouth. God knows I wouldn't want to do that with Secretary Arne Duncan. But tell me, you know, there's only so much time in a day administrators have and principals, et cetera. So if they have to put energy into thinking about counting pencils and reusing materials or foregoing it rather than energy into reform--do you think it takes away from the focus, the energy, the experimentation that was going on, that added vitality? In other words, there was juice, there was mojo behind reform. Secretary Duncan. As I visit schools around the country, Senator, I've been to hundreds and hundreds of schools, I can't ask people to work much harder. People are working so hard, often in very, very difficult circumstances, trying to make a difference and trying to help young people be successful academically. To slap them in the face and say, we're going to walk away from our investment, not just financially but to your point, psychologically or emotionally, that's a very, very difficult thing to ask teachers and principals or superintendents to adjust to. And we should not be putting them in that situation. Senator Mikulski. So now, particularly after 4 years of reform efforts, and let's face it, there were some tussles with the teacher associations, but it seems like now there's been a detente and now a focus on how we can really evaluate teachers and move forward. Do you feel that, gee, we're on the brink now of making even more substantial leaps if we stick to the program? Secretary Duncan. There's no question. I'd say more than detente, I think there's a common interest amongst everybody that we have to work together to lead the world in education, and that the status quo wasn't enough. Everyone is not going to agree on every issue, but I think there's a tremendous convergence of agreement of what we have to get done and what we have to get done together. And again, to take a step backwards, to take a step in the wrong direction, would be a huge blow to those efforts, those collective efforts. Senator Mikulski. Thank you. Thank you very much, Mr. Chairman. Senator Harkin. Thank you very much, Senator Mikulski. Senator Durbin. Senator Durbin. Thank you, Mr. Chairman. Mr. Secretary, thank you for being here. Thanks for this hearing. CHANGE SINCE THE LAST BALANCED BUDGET I think it bears repeating that Senator Inouye, the Chairman of the Appropriations Committee, gave us a yardstick to measure what has happened in the Federal budgeting process since the last time our budget was in balance under President Clinton. And in that 10- or 11-year period of time, in real dollars, or constant dollars, we have seen the following: In nondefense discretionary spending, there has been zero increase--zero increase--in the last 11 years. In the entitlement mandatory area, there has been a 30-percent increase, reflecting the arrival of the boomers and the cost of healthcare. On the defense side, there has been, as of this year's budget, a 73-percent increase in spending since the budget was last in balance. And now what we are facing today is the prospect of even deeper cuts on the nondefense discretionary side and education, and strong calls from the other side of the aisle to leave defense untouched. I want the strongest military in the world. We have it. I want to make sure that if my nephew is again deployed to Afghanistan, he has the best, and everyone like him has the best, to come home safely. But it just is incredible to me that we cannot find, within the Department of Defense and Pentagon, savings to help us reduce our deficit. There are those who argue we can find none. EXAMPLES OF IMPACT ON CHICAGO SCHOOLS I would like to ask you, Secretary Duncan, go back a little in time to your role in the city of Chicago as superintendent of that school system, and tell me what this sequestration would mean to the school system that you were struggling to build into a model for urban education. ACCESS TO AFTER-SCHOOL ACTIVITIES AMONG CUTS Secretary Duncan. The impact would be more things than I can state now but just a couple of simple ones: Class size would almost automatically increase. Access to summer school for children who are struggling would decrease. Access to after-school programming would decrease. Access for children with special needs to the services and support they need to be successful would decrease. Career and technical education, vocational education, which is really important, would decrease. Access to college counselors would decrease. Access to extracurriculars would decrease. And I could go on and on and on but just as a start there. Early childhood education with chances to have children enter kindergarten ready to succeed academically and socially, those things would go down as well. After-school programming, which is so hugely important in communities like Chicago, would go down; there would just be less access. RELATIONSHIP BETWEEN AFTER-SCHOOL ACTIVITIES AND DROP IN CRIME Senator Durbin. We recently have gone through a spate of increased crime in our city of Chicago. Mayor Emanuel and the superintendent of police, they are working hard on it. And one of the things that they have found in the communities where there are activities for young people, after-school programs and activities, there's less violence. It's pretty obvious. To a parent, it's very obvious. What was the old saying? Idle time is the devil's workshop? Senator Mikulski. Something like that. Secretary Duncan. Something like that. Senator Durbin. And what we find here then is a proposal that when it comes to cutting at the Federal level, there will be fewer activities for enrichment and opportunities just to work-off energy available to students in school districts across the country but, particularly, in urban districts where it could have a profound impact on the quality of life. Secretary Duncan. In poor communities, be it inner-Chicago or rural or remote areas, we need more opportunities for students during the school day, before school, after school, Saturdays, weekends, summers, whatever it might be. We need more opportunities, not less. There is no way these kinds of massive cuts can lead to more opportunities. It is impossible. ALL OPTIONS FOR FISCAL CUTS MUST BE ON THE TABLE Senator Durbin. I cannot imagine that we believe we can build a stronger America and cut education. That is just counterintuitive to all of us in our lives, and counterintuitive to the American story, where people came to this country and succeeded because parents said to their kids, I may not have much education, but you're going to get the best and you better come home with a good report card. That was my family story and the story of America. And now we have those who want to walk away from it. I'm all for bringing this budget deficit under control. There are ways to do it. But if we don't go back to a model that puts everything on the table, including revenue, including defense, if we don't put it all on the table, we're going to find ourselves paying a heavier price than even the price of interest on our debt. IMPORTANCE OF COMPROMISE Secretary Duncan. I think our democracy was built on the value or the notion of compromise, and you don't have a vibrant democracy without a willingness to compromise. And if somehow that's become a dirty word, that's very, very troubling to me. Senator Durbin. Thank you. Thanks, Mr. Chairman. Senator Harkin. Thanks, Senator Durbin. Senator Pryor. Senator Pryor. Thank you, Mr. Chairman. I would like to ask Senator Durbin why he turned to Senator Mikulski to ask her about the devil's workshop. That's what I want to know. Senator Durbin. Similar Catholic backgrounds. Senator Mikulski. I know a lot about that. See me later. Senator Pryor. You're our in-house expert. Mr. Secretary, thank you for being here. IMPLEMENTATION OF EDUCATION BUDGET CUTS I have seen the numbers from fiscal year 2011, fiscal year 2012, the Senate number from fiscal year 2013, and the sequestration numbers. And if you look at fiscal year 2011, fiscal year 2012, you've already taken about a $230 million cut. That's real money. And we know the Senate number. We don't know what the final number will be for fiscal year 2013 yet, but sequestration obviously is going to have a negative impact on what you're able to do and how we are going to be able to educate our children. ACROSS-THE-BOARD CUT TO EDUCATION I would like to ask a little bit about the logistics though. I've seen the estimates that CBO talks about, a 7.8- percent reduction. When people talk about sequestration, they talk about an across-the-board cut. I'm wondering, within your Department, do you see this as an across-the-board cut or will you pick and choose certain things to cut to try to implement the reductions in a smart way? Secretary Duncan. I don't think we have a lot of flexibility there, Senator. You know, I mentioned a number of items. I would add TRIO to that list, Gaining Early Awareness and Readiness for Undergraduate Programs (GEAR UP), School Improvement Grants. We would have to cut across the board. Senator Pryor. So if the number, for example, was 7.8 percent, you would just have to take each program---- Secretary Duncan. Regardless of impact, regardless of efficacy, regardless of effective versus ineffective. It is a horrendous way to think about budget choices. GLOBAL COMPETITORS INCREASING, NOT CUTTING BUDGETS Senator Pryor. And one of the points I think you made earlier is that our competitors in this global economy are not cutting. In fact, they're doing the opposite. Is that fair to say? Secretary Duncan. That is exactly right. They are investing, they are innovating, they are committed to making sure their young people have a very high-quality education. EDUCATION CUTS ABSENT SEQUESTRATION Senator Pryor. Now, if we are able to avoid sequestration, which I think is actually possible, we are going to have a lot of work to do late this year on the budget and taxes to get the deficit where it needs to be. This is going to be a huge undertaking by the Congress. I hope that the Congress and the House and Senate both will be serious about it when we get to that point. But I think it's possible that we'll avoid sequestration, or at least limit it in some way. But you will probably still be looking at some cuts in education. Do you have a game plan for that? Are you just going to wait on the Congress to act? Secretary Duncan. So again, we've cut over the past couple of years more than $1.2 billion of our budget and have been trying to, again, take money out of programs that we think are less than optimally effective and go other ways. And our budget team is as smart and talented as I think any team in any agency. And we would go through that exercise every single year. And, frankly, whether we have a budget increase or a budget cut, we make those tough calls. And so we would be prepared to do that going forward. We just want to have the ability to do this in a thoughtful way. EDUCATION IS AN INVESTMENT, NOT AN EXPENSE At the end of the day, we fundamentally think of education as an investment, not as an expense. I think that's part of the value of the debate that our country is having, is education an expense, that we should cut back on early childhood education and K-12 reform and access to higher education? Or is this an investment in young people, in our country, in our country's economic future? That's the challenge, that's the debate, I think, our country is looking at. GUIDANCE TO LOCAL EDUCATION AGENCIES IF SEQUESTER IS ENACTED Senator Pryor. Let me praise you here just for a minute, because I've been meeting with some of our principals, and teachers, and educators, and folks involved in that back in Arkansas. And you have sent out a letter to school officials alerting them that this may be coming. And I think that's good to be in touch with them. But they say that your letter or the communications with the Department of Education have not given a whole lot of guidance, real specific guidance on what to do. Is the plan that, if we have to do sequestration and we have to implement it fully, will you guide them through this process? Secretary Duncan. We will do everything we can, Senator, to be a good partner. Obviously, the vast majority of our energy now is to avoid sequestration. And my understanding is sequestration was set up so that it was so bad, sort of mutual self-destruction, that neither side would want to go down that path. Senator Pryor. Do you agree it is that bad? Secretary Duncan. I do think it's that bad. And so the vast majority of our time and energy over these next 5 months is to do everything we can to be a good partner to avoid this happening. And if it does happen, we'll do everything we can to instruct and to guide, and to lead folks at the State and local level. But, Senator, we should not go down that path as a country. Senator Pryor. You know, when I look at your education funding, your budget, your programs, all the things you do, everything is important. I mean, the goals were good. We're trying to educate our children for all kinds of good reasons to do that. IMPACT ON RURAL AREAS AND STUDENTS WITH DISABILITIES But there are two areas that I'm really concerned about with sequestration. That would be the impact on rural America. And as you know, a lot of those schools are struggling already, and you look at all the test scores, look at all the funding, look at all the issues they're dealing with, rural America is really struggling. And then disabilities, students with disabilities. I'm just worried that cuts in those--they're going to be devastating everywhere, but in those two areas, they really, really could be harsh. SEQUESTRATION EFFECT ON IMPACT AID Secretary Duncan. No question. And obviously, there's so many things to add to the list, but Impact Aid, to think that we would walk away from funding for the children of servicemembers who are risking their lives every single day overseas and somehow say we'd give less funding to those children's schools is inconceivable to me. Senator Pryor. Mr. Chairman, thank you. Senator Harkin. Thank you, Senator Pryor. Senator Shelby. EDUCATION BUDGET INCREASES SINCE 2008 Senator Shelby. Mr. Secretary, we've been hearing numbers here about the education budget. It is my understanding, and you correct me if I'm wrong on this, that since 2008, the education budget has increased $7.2 billion from $59.2 billion to $68.4 billion. Are those figures right? Secretary Duncan. I think those figures should be about right. We fundamentally think education is an investment, not an expense. Senator Shelby. But it is an appropriation, so it's deemed as an expense of some kind. It might be an investment. We all like that. But it is an appropriation, is it not? It's money. Secretary Duncan. Absolutely. We have to educate our way to a better economy. Senator Shelby. Sure. Thank you. Senator Harkin. Mr. Secretary, first of all, thank you again, for being here and for your very eloquent statement and answers to our questions. Thank you for your great stewardship for the Department of Education, and for so many of the reforms that you have made. And for ensuring that our kids are the best educated in the world. We're going to have some tough months ahead of us, but I think what we've heard is that, in education, sequestration would be devastating, for present day and for the future of this country. And I think you put that in pretty stark terms. Thank you very much, Mr. Secretary, unless you had something else to add. Secretary Duncan. Thank you for the opportunity, and thank you for your leadership. Senator Harkin. Thank you, Mr. Secretary. NONDEPARTMENTAL WITNESSES Senator Harkin. And now we'll call our second panel. I'm sorry. Senator Landrieu was hoping to attend today. However, she had a prior commitment. She would like to express her apologies and would like to submit some questions for the record. Without objection, that will be accommodated. Our next panel I'll introduce as they are taking their seats. June Atkinson has served as the State superintendent of the Public Schools of North Carolina since 2005. She was the first woman elected to this position. Dr. Atkinson received her master's degree in business education from Radford University, a master's degree in vocational and technical education from Virginia Tech, and a doctorate in educational leadership and policy from North Carolina State University. Billy Walker is currently serving his fifth year as superintendent for the Randolph Field Independent School District in Universal City, Texas. Dr. Walker received his bachelor's degree in sociology and physical education from East Texas Baptist University and both his master's in education administration and his education doctorate in educational leadership from Lamar University. Mr. Neal McCluskey is the associate director of the Cato Institute Center for Educational Freedom. Mr. McCluskey holds a master's degree in political science from Rutgers University. Tammy Mann serves as the president and CEO of the Campagna Center--I hope I pronounced that right--Campagna Center in Alexandria, Virginia, which administers Head Start and Early Head Start for more than 400 children. Dr. Mann was recently appointed by the Secretary of Health and Human Services to serve on the advisory committee for Head Start Evaluation. She received her bachelor's degree from Spelman College and completed her master's and doctorate in clinical psychology at Michigan State University. To all of you, I thank you for being here and testifying today. Each of your statements will be made a part of the record in their entirety. We'll go from left to right. And if you could sum up in 5 minutes or so your basic testimony and leave some room for some questions, we'd appreciate that. So, Ms. Atkinson, welcome and please proceed. STATEMENT OF JUNE ATKINSON, STATE SUPERINTENDENT OF PUBLIC INSTRUCTION, RALEIGH, NORTH CAROLINA Dr. Atkinson. Thank you, Chairman Harkin and Ranking Member Shelby. Thank you for the opportunity to testify before you today about the impact of sequestration on education. I am June Atkinson, State superintendent of public instruction for the great State of North Carolina, and I'm also a board member for the Council of Chief State School Officers. The council just completed its annual summer conference last week, and the issue of sequestration came up numerous times. My colleagues across the Nation share my concern about the impact of these drastic cuts. There are two fundamental issues I want to address. First, my strong opposition to automatic, across-the-board funding cuts that will be detrimental to education reform and remodeling occurring across the country. In North Carolina, as in other States, reforms supported by Federal funds are focused on raising student achievement and helping to ensure that our students graduate college, career and citizenship ready. Second, the immediate need for clear and complete guidance from the Federal Government on how sequestration will work, in the event that it goes into effect. Fortunately, we have received some initial guidance late last week from the administration regarding how portions of advanced funding of title I, title II, IDEA part B, and career and technical education appropriations will be treated. But States need to have the complete picture. Chief State school officers across the country are focused on education reform efforts such as implementing the common core State standards, developing new assessments to better gauge student learning, and developing new teacher and leader evaluation systems to help drive improvements across our educational workforce. We are focusing on the use of technology systems to improve the effectiveness and efficiency of student and teacher learning. We have taken on these tasks in the best interests of our students even during some of the toughest economic times. Simultaneously, though, our education obligations grow, with States expecting to educate 540,000 more K-12 students. Let me give you some examples from North Carolina. Sixteen percent of our education budget comes from the Federal Government. An across-the-board cut would dramatically stifle our remodeling efforts underway to personalize education so that each student will graduate prepared for options. And let me give you some examples. We are making tremendous success in turning around our low- performing schools under the School Improvement Grants program. With a cut, we would have an impact upon 1,000 students in North Caroline alone. We are also implementing a blended learning approach of face-to-face and online instruction for our students with disabilities using IDEA funds, which would be subjected to a loss of more than $900 million nationally, with an impact upon more than 13,000 students in North Carolina. North Carolina also leads the Nation in credentialing students with Microsoft certification. During the last 18 months, 51,225 certifications were issued to our students and some teachers. Without support from Career and Technical Education funds for this initiative, we could not have prepared students to facilitate this important initiative for our students. And I must also mention that our graduation rate of our students who complete a career technical sequence is 90 percent. Every summer, our students who come from homes where no one is reading to them or without books to read lose 2\1/2\ to 3 months of reading progress. They come back to school in the fall and the teachers have to re-teach what the students have lost. Through title I funding, many of our title I schools such as H.C. Bellamy Elementary School in Wilmington, North Carolina, offer reading programs to help with the reading loss. States such as mine are strategically addressing the need of our students, especially our most vulnerable students. PREPARED STATEMENT In order for us to move forward, we need specific and complete guidance about the cuts. Please look at sequestration and how it will hurt States such as mine. Education is a tiny fraction of the Federal budget but with enormously high impact on our Nation's future. Teachers and students are not responsible for sequestration, yet they must suffer if sequestration goes into effect. Students and educators are not to blame for our Nation's fiscal problems, and they deserve better. I ask for the Congress's action for the good of the country, our schools, and our children. [The statement follows:] Prepared Statement of June Atkinson Chairman Harkin, Ranking Member Shelby, and members of the Labor, Health and Human Services, and Education, and Related Agencies Appropriations Subcommittee: Thank you for inviting me to testify here today on the impact of sequestration on education reform and programming. I am June Atkinson, State Superintendent of Public Instruction, for the great State of North Carolina and a board member for the Council of Chief State School Officers. The Council just completed its annual summer conference last week and the issue of sequestration came up numerous times. My colleagues across the Nation share my concern about the impact of these drastic funding cuts. There are two fundamental issues I want to address today. First, my strong opposition to automatic, across-the-board funding cuts, that will be detrimental to education reform and remodeling occurring across the country. In North Carolina, as in other States, reforms supported by Federal funds are focused on raising student achievement and helping to ensure all of our students graduate college, career and citizenship ready. Second, the immediate need for clear and complete guidance from the Federal Government on how sequestration will work, in the event it does go into effect on January 2, 2013. States need to know when and how cuts will be made to various funding streams that we receive. Fortunately, we received some initial guidance late last week from the administration regarding how portions of title I, title II, Individuals with Disabilities Education Act (IDEA) part B, and Career and Technical Education funds that we receive as advanced appropriations will be treated. But States need to know the complete picture. In the absence of complete guidance States cannot adequately help their districts and schools prepare. The absence of such guidance will clearly exacerbate the drastic nature of these funding cuts. I implore you to use your congressional authority to prevent sequestration or at the very least require that the administration provide States with as much information as quickly as possible. Chief State school officers across the country are focused on education reform efforts such as implementing the common core State standards, developing new assessments to better gauge student learning, and developing new teacher and leader evaluation systems to help drive improvements across our education workforce. We are focusing on the use of technology systems to improve the effectiveness and efficiency of student learning. We are developing technology systems to help teachers learn and grow professionally. We have taken on these tasks in the best interests of our students even during some of the toughest economic times. In fact, a recent report by the Center on Budget and Policy Priorities highlights that our struggling economy impairs States' ability to fund services. States have already faced tough choices to close a combined $540 billion in budget shortfalls between 2009 and 2012. Moreover, according to the report, the 2007 recession caused the largest collapse in State revenues on record: As of the first quarter of 2012, State revenues remained 5.5-percent below prerecession levels. Simultaneously, though, our education obligations grow, with States expecting to educate 540,000 more K-12 students. Our State and local education agencies are currently running on shoestring budgets, and cannot afford additional cuts. Let's take North Carolina as an example. Sixteen percent of our education budget comes from Federal funding. A 7-10 percent across-the- board cut projected for sequestration would dramatically stifle our remodeling efforts underway to personalize education so that each student will graduate prepared with options. --I am proud that we are currently seeing great success in turning around low-performing schools under the School Improvement Grants program. Under sequestration, this program would be subjected to a loss of more than $40 million nationally, with an impact upon more than 1,000 students in North Carolina alone. --We are also implementing a blended learning approach for our students with disabilities using IDEA funds, which would be subjected to a loss of more than $900 million nationally, with an impact upon more than 13,000 students in North Carolina. It is worth noting that the Federal Government has still not lived up to its commitment to provide 40 percent of the excess costs of educating students with disabilities. A sequestration cut represents a further lack of that commitment. That impact also will hurt our innovative initiative to blend online and face- to-face instruction for many of our students with disabilities. Recently, North Carolina was just recognized for this exemplary delivery of instruction to exceptional children. One of our teachers in this program was recently recognized as the national Virtual Teacher of the Year. In the words of one of our students in this blended environment, ``I love the teacher I have in the classroom and the teacher who helps me online. I am now really understanding math.'' --We are helping our teachers implement this new blended learning approach through online learning modules and professional development funded through title II part A, which would be subjected to a cut of almost $200 million nationally and could result in nearly 100 job losses in North Carolina alone. Businesses have gone through retooling, and if we are going to value and respect our teachers and students, we must provide necessary professional development to help teachers retool their work in the classroom to reach each student. --North Carolina also leads the Nation in credentialing students with Microsoft certification. During the past 18 months, 51,225 certifications were issued to our students and some teachers. Those certifications communicate to businesses that our students are prepared for success in the workplace. Without support from Career and Technical Education (CTE) funds for this initiative, we could not have prepared teachers to facilitate this important initiative to our students. The CTE program faces a loss of nearly $90 million nationally reducing instruction and other services for an alarming 52,000 students in my State alone. --Our State has experienced growth in our English language learner population over the past 5 to 10 years. One of the most important aspects of our Federal dollars, again, is to help our students who need to become proficient in English. As a result of Federal dollars, we have been able to help teachers address in better ways the needs of this population of students and yet the cuts to title III, English language acquisition funds would impact the services we are offering to more than 100,000 students across North Carolina. --Every summer, our students who come from homes where no one is reading to them or without books to read, lose 2\1/2\ to 3 months of reading progress. These students don't have the opportunity to go to camp, the beach, or even the next town. They come back to school in the fall and the teachers have to re-teach what the students have lost. Through title I funding, many of our title I schools such as H.C. Bellamy Elementary School in Wilmington, North Carolina, offer summer reading programs. Last week I visited that school, talked to the students, and to Ms. Karen Sherman who runs the program. I am confident that the students in that program will not fall behind this summer. To paraphrase one of the students in that summer program, Jackson, ``I am reading everything I can.'' Such a statement should be a reason to celebrate how title I funding helps students keep on-track in reading. Yet, under sequestration, title I funds would be cut by more than $30 million in North Carolina alone, impacting more than 40,000 students and potentially costing my State more than 500 job losses. As you can see, States such as mine are strategically addressing the needs of low-income students in underperforming schools, students with disabilities, English language learners, students seeking industry certification, and the professional development needs of our teaching corps. Our work in addressing the needs of specific populations is demonstrating positive results. Our graduation rate is at an all-time high, and our student achievement is at an all-time high since we have increased our expectations and standards about 4 years ago. I am concerned that sequestration will make it harder to continue our progress and our commitment to long-term national competitiveness. To be clear, chief State school officers believe wholeheartedly that we must better use our limited education funding. In fact, one of the primary topics of the Council's summer conference was strategic resource allocation. We need to focus primarily on proven strategies and not continue to fund programming that does not produce results or serve our student's needs. We will be your partners in any thoughtful process to improve the return on investment in Federal education funding. But, I must also be equally clear that across-the-board, indiscriminate cuts do not help us achieve our State or national education goals. Chief State school officers will continue to wrestle with how we increase the efficiency and productivity of our educational funding, but we cannot do so if we are simultaneously wrestling with how we simply keep the lights on and continue to support effective education programming. Exempting some programs from sequestration is not the answer either. Any vote to exempt some Federal funding from sequestration while allowing education funding to be subject to sequestration stands in stark contrast to the best interests of our children and the long- term economic and national security of this country. You are all aware of the recent Council on Foreign Relations report which highlights the needs for investing in education in order to maintain our global economic security. According to the report, intelligence agencies face critical shortages in the number of foreign-language speakers and that fields such as science, defense, and aerospace are at risk because of a shortage of skilled workers. An analysis from the Alliance for Excellent Education calculates the economic benefit of reducing our high school dropout rate by one- half. While our graduation rate is at an all-time high, I know that we must continue our work to make sure that nearly 100 percent of our students graduate. According to the Alliance, cutting our dropout rate in one-half would result in almost $300 million in increased earnings, more than $200 million in increased spending, $650 million in home sales, and $28 million in new tax revenue for North Carolina. With numbers like that for North Carolina alone, it is hard for me to understand why there isn't a stronger nationwide commitment to educate our children when we can clearly enjoy an economic benefit. To my second point, without clear and complete guidance, we cannot prepare for these cuts. I respect that the outcome of sequestration discussions will be determined at the highest levels of our political process. I recognize that the process is complicated by the pending debt ceiling debate and debates on tax cut extensions. I do appreciate the guidance we received last week from the Department of Education about how fiscal year 2012 funding that is advanced into fiscal year 2013 will be treated. It is important for States and our school districts to know that any impact of sequestration in title I, title II, IDEA, and CTE will not be felt until July 2013. As I mentioned previously, the administration has just begun answering some critical questions, but I cannot accept the lack of clear guidance from the Federal Government to the States on all aspects of the implementation of sequestration. We need to know just how sequestration will affect forwarded-funded and advanced appropriations alike. We still need guidance that gives us the complete picture. Specifically, we require additional information on: --unobligated balances from fiscal year 2012 budget authority provided in the fiscal year 2012 omnibus appropriations law; --fiscal year 2014 budget authority that will be provided as advanced appropriations in the fiscal year 2013 continuing resolution or appropriations bill; --the impact of sequestration on hold harmless and/or maintenance of effort provisions; and --most importantly, what will be the specific cut made to each program. Sequestration is also creating confusion on the programmatic side. Currently, States can reserve 4 percent of title I funds for school improvement activities. School districts are also assured that they won't receive less title I funding from the previous year due to this reservation. Under a 7-10 percent cut, States may not be permitted to make this 4 percent school improvement reservation. This is compounded by current efforts in the House appropriations bill to eliminate the separate school improvement grant program. The combination of the inability to make this 4-percent reservation and a loss of school improvement grant funding will eliminate dedicated Federal funding for turning around our lowest achieving schools. Without getting the complete picture, we can speculate, but we cannot fully advise or support our districts as they prepare budgets in advance of the 2013-2014 school year and beyond. It is promising that the House of Representatives passed the Sequester Transparency Act and that Senators Murray and McCain worked in a bipartisan manner to attach an amendment to the farm bill that would have forced the administration to provide an even more detailed explanation. On behalf of my State colleagues, let me also say that if we are subjected to sequestration then I also encourage you to think about new flexibilities you can offer States and districts in the use of their now reduced Federal dollars. If the Federal Government does, indeed, provide significantly less Federal funding in future years, it must make corresponding reductions in compliance burdens placed upon States and districts. Sequestration came into being because of the failure of the Congress to agree on how to resolve disagreements on fundamental issues of revenue and spending. Education is but a tiny fraction of the Federal budget but with enormously high impact on our Nation's future. Teachers and students are not responsible for sequestration, yet they will suffer the most if sequestration goes into effect. Students and educators are not to blame for our Nation's fiscal problems, and they deserve better. Senator Harkin. Thank you very much, Dr. Atkinson. And now we'll move to Dr. Walker. Dr. Walker, welcome. STATEMENT OF BILLY WALKER, Ed.D., SUPERINTENDENT, RANDOLPH FIELD INDEPENDENT SCHOOL DISTRICT, UNIVERSITY CITY, TEXAS Dr. Walker. Good morning. Thank you, Sir. Good morning, Chairman Harkin, Ranking Member Shelby, and members of the subcommittee. My name is Billy Walker, and I am the superintendent of Randolph Field Independent School District, and I also serve as the executive director for the Texas Association of Federally Impacted Schools. I would like to take just a moment, Senator Harkin, to thank you for your support of Project Student Outreach, Access, and Resiliency (SOAR). Randolph Field piloted SOAR at Home and SOAR at School in 2007 and 2008, an awesome program for our military children. And the University of Northern Iowa was a key player in that success. Randolph Field is a public school district located on Randolph Air Force Base in the San Antonio, Texas, area. Our student body is made up of children of active-duty members from all branches of our military. We have approximately 1,200 students, equally spread between the elementary and secondary campuses. Since our students come from military families, our real annual mobility rate is approximately 30 percent. My expectation for everyone in our district is to ensure that each student learns more and at higher levels, every day. Approximately one-half of our funding comes from Texas through the normal State funding mechanism, and the remaining half comes from the Department of Education through title I, IDEA, and Impact Aid. While Impact Aid is the lifeblood for our district--excuse me--Title I and IDEA are important programs to school districts nationwide. As 1 of the 7 coterminous districts in the Nation, the boundaries of the base comprise the boundaries of our district, meaning our school district doesn't have a local tax base. Our district uses Impact Aid funding in lieu of the tax dollars normally raised locally to provide salary and benefits for our employees, transportation, and facility needs, and among other things, fill the gaps left to the district due to less than full IDEA funding. The threat of sequestration takes the complex and difficult situation of school funding to unprecedented levels. We started the work of reducing our budget 3 years ago as fiscal experts projected significant reductions in the near future. Texas reduced K-12 funding by some $5 billion over the current biennium. Earlier this spring, school districts in Texas were notified that the State would be withholding 10 percent of Federal funding because of sequestration. We are certainly not alone. The American Association of School Administrator's Economic Impact Series found that 71.2 percent of school districts reported a reduction in State and local revenues over the last 2 school years, and 57 percent anticipate a decrease for the upcoming school year. Sequestration will exacerbate the issue of funding. Superintendents nationwide are deeply concerned about the impact that cuts will have on schools, programs, and students, including our ability to fulfill the educational obligation to children with special needs. Last year, our school district experienced a 5-percent reduction in IDEA funding and approximately 17-percent reduction in title I part A revenue. Our Impact Aid revenue was reduced by approximately 5 percent last year, and we anticipate an additional reduction of 7 to 8 percent for the upcoming school year. To make matters worse, Impact Aid is the only current-year funded education program, which means on January 2, 2013, Impact Aid will sustain an immediate cut of more than $100 million. If by October 1, the Congress doesn't authorize full- year spending, initial payments to Impact Aid districts could be as low as 50 percent, significantly lower than many districts require to operate effectively, without carrying a fund balance or borrowing funds. No matter what happens, children will be at school as scheduled. PREPARED STATEMENT Today, I'm also concerned about the law's long-term implications. If sequestration is truly a 10-year project, the devastating budget cuts may force us to close our doors. Unfunded mandates have always complicated our work. Now with the advent of further significant reductions in revenue, children, including those who know only war and whose parents have honorably served our country, are the ultimate lifelong losers in a game that should give them all they need to be successful, productive citizens. The concept of doing more with less is admirable, but there comes a time when there is not enough left to adequately and equitably educate the children of America. Thank you for this opportunity to share my district's story. [The statement follows:] Prepared Statement of Billy Walker, Ed.D. Good morning Chairman Harkin, Ranking Member Shelby, and members of the subcommittee. My name is Billy Walker and I am the superintendent of Randolph Field Independent School District and Executive Director of the Texas Association of Federally Impacted Schools (TAFIS). I would like to take a moment of personal privilege to thank Senator Harkin for his support of Project Student Outreach, Access, and Resiliency (SOAR). We had the privilege at Randolph Field Independent School District to pilot SOAR at Home and SOAR at School in 2007-2008. Randolph Field is a public school district located wholly on Randolph Air Force Base in the San Antonio, Texas, area. Our student body is made up of children of active-duty members from all branches of our military. We have about 1,200 students--600 at the elementary campus and 600 at the secondary campus. The demographic makeup of our student body reflects very closely the make up of the military in general, 9 percent of our students are economically disadvantaged, and since our students come from military families, our real annual mobility rate is approximately 30 percent. My team will tell you that my expectation for everyone in our district is to ensure that each student learns more, and at higher levels, every day. Our district is a prime example of high expectations and hard work paying off in excellent results in most any assessment one might make of us. Approximately one-half of our funding comes from Texas through the normal State funding mechanism and the remaining one-half comes from the Department of Education through title I, Individuals with Disabilities Education Act (IDEA), and Impact Aid (fiscal year 2012 total: $6,102,297, fiscal year 2013 total: $5,554,019). While Impact Aid is the lifeblood for our district, title I and IDEA are important programs to school districts nationwide. (The net for our district to provide all services as mandated for special needs students is -$210,507 for fiscal year 2012.) As 1 of the 7 coterminous districts in the Nation, the boundaries of the base comprise the boundaries of our district, meaning our school district doesn't have a local tax base. Impact Aid replaces the lost local revenue due to the Federal presence. For example, our district uses Impact Aid funding in lieu of the tax dollars that would normally be raised locally to ensure a comprehensive academic, co-curricular, and extracurricular program, provide salary and benefits for our employees, handle facility needs, operate our transportation, custodial and school nutrition departments, and fill in the gaps left to the district due to less than full IDEA funding at the Federal level. The threat of sequestration takes the complex and difficult situation of school funding, both in America and in my State of Texas, to unprecedented levels. We started the work of reducing our budget some 3 years ago as fiscal experts at both levels of government projected significant reductions in the near future. At the State level, Texas reduced K-12 funding by some $5 billion over the current biennium. This resulted in a reduction in State funding of approximately 10 percent over 2 years (2011-2012 (5 percent) and 2012- 2013 (5 percent)). Earlier this spring, the Texas Education Agency notified school districts that the State would be withholding 10 percent of funding because of sequestration. We are certainly not alone: The most recent report in the American Association of School Administrator's Economic Impact Series found that 71.2 percent of school districts reported a reduction in State/local revenues between the 2010-2011 and 2011-2012 school years, and 57 percent anticipate a decrease for the 2012-2013 school year. As we were looking to the future, my leadership team, board, staff, and I diligently reviewed all personnel, programs, and expenditures to make reductions to balance the budget for the 2012-2013 school year. Based on my experiences with delayed Impact Aid funding and the uncertainty of the appropriations process, I ultimately insisted that the sequester reduction be built into the budget. We've done our best to prepare for the cuts, and I could not, in good conscience, mortgage the fiscal future of our district with obligations that we would most likely not be able to sustain. To reach a balanced budget, we made the following reductions: At the campus level, eliminated: --elementary reading specialist and librarian; --middle school reading specialist and secretary; --secondary English teacher, science teacher, math teacher, and the 1:1 laptop initiative; and --the baseball, cross country, and swimming programs. At the district level, faculty, staff, and administration did not receive a traditional pay raise for the 2011-2012 or 2012-2013 school years. Eliminated: --one custodian and the custodial supervisor; --one staff member from the curriculum department; --facility planner/coordinator position; and --one technology department staff member. Additionally, we are considering not taking the band, cheerleaders, and dance team to away football games, and eliminating field-based excursions for all students during the 2012-2013 academic year. In the 2011-2012 fiscal year, our school district experienced a 5- percent reduction in IDEA funding and a 17-percent reduction in title I part A revenue. Sequestration will exacerbate the ongoing issues surrounding the critical issue of funding required to fulfill the educational obligations of children with special needs. While these programs don't comprise the majority of Federal funding for Randolph, superintendents nationwide are deeply concerned about the impact that cuts to these and other Federal education programs will have on schools, programs, and students. Our level of Impact Aid revenue was reduced by approximately 5 percent for the 2011-2012 year, and we anticipate an additional reduction of 7 percent to 8 percent for the 2012-2013 academic year. To make matters worse, Impact Aid is the only current-year funded education program, which means on January 2, 2013, Impact Aid will sustain an immediate cut of more than $100 million. If by the October 1 start of the fiscal year the Congress hasn't authorized full-year spending, initial payments to Impact Aid districts could be as low as 50 percent. This is significantly lower than many districts require to operate effectively, meaning school districts must either have a fund balance capable of sustaining the district until their Impact Aid payment arrives, or they must borrow the funds needed to ensure the continued operation of the district. No matter what happens, the children will be at school as scheduled. Today, I'm concerned about the law's long-term implications. If sequestration is truly a 10-year project, the devastating budget cuts may force us to close our doors. Unfunded mandates have always complicated our work. Now, with the advent of further significant reductions in revenue, the dream of a high-quality education for all becomes a dream unfulfilled; programs that provide opportunities for children to discover their passion in life languish on the shelf; and children, including those who know only war and whose parents have honorably served our country for over a decade, are the ultimate lifelong losers in a game that should give them all they need to be successful, productive citizens. The concept of doing more with less is admirable, but there comes a time when there is not enough left to adequately and equitably educate the children of America. Policymakers must do everything in their power to ensure that each child in this great Nation has the opportunity to learn more, and at higher levels, every day. Thank you for this opportunity to share my school district's story. I look forward to answering any questions. Senator Harkin. Thank you very much, Mr. Walker. Now we will turn to Mr. McCluskey. Mr. McCluskey, please proceed. STATEMENT OF NEAL P. McCLUSKEY, ASSOCIATE DIRECTOR, CENTER FOR EDUCATIONAL FREEDOM, THE CATO INSTITUTE, WASHINGTON, DC Mr. McCluskey. Chairman Harkin and Ranking Member Shelby, thank you for inviting me to speak with you today. My name is Neal P. McCluskey, and I am the associate director of the Center for Educational Freedom at the Cato Institute, a nonprofit, nonpartisan public policy research organization. My comments are my own and do not represent any position of the institute. Cuts such as those that would be made to Federal education programs through sequestration are necessary. Not only does the Federal Government have no constitutional authority to fund and administer education programs, but the last 40-plus years of Federal involvement are a clear demonstration of futility. Begin with Head Start, which has existed since 1965 and has cost roughly $180 billion through its lifespan. Despite its longevity, it has failed to demonstrate lasting benefits. Indeed, a 2010 Federal study found overwhelmingly that the program has no lasting positive academic effects, and that's not its only problem. Head Start has long suffered from serious waste and abuse. Indeed, the Government Accountability Office (GAO) reports in 2000, 2005, and 2008 found widespread noncompliance with financial management standards and very poor efforts to remediate the problem. Next, Federal elementary and secondary education programs. As the charts on my written testimony illustrate, on a per- pupil basis, inflation-adjusted Federal spending has grown immensely over the last several decades, ballooning to 375 percent of their original 1970 value by 2010. And this increase did not just compensate for funding losses at the State and local levels. Overall, per-pupil expenditures have nearly tripled since 1970. Meanwhile, scores on the National Assessment of Educational Progress have been almost completely stagnant for 17-year-olds, the final products of our schools. These huge spending increases coupled with more moribund achievement powerfully illustrate that we haven't gotten any bang for our Federal education bucks. And those expenditures could be reduced considerably without ill achievement effects. Indeed, it is quite likely that Federal education dollars have kept recipient districts from having to take politically difficult but necessary actions to increase their efficiency and effectiveness. Connected to this it seems that the most pressing concern for many people is that sequestration would reduce education employment. High-end estimates for 2013 published by the National Education Association predict losses of about 46,000 jobs. While no one wants to see anyone lose employment, the Federal Government has a staggering debt that must be addressed. And as the third chart of my testimony illustrates, over the last four decades, there have been huge increases in public school staffing, but, again, outcomes have flat-lined. And 46,000 jobs, that's not even close to 1 percent of the total public-schooling workforce. Public schooling is supposed to educate children, but it is instead often treated as a jobs program. Last, higher education. Regrettably, Pell grants appear to have been exempted from sequestration, taking roughly $42 billion off the table. While conclusive data are not available, a reasonable estimate suggests that only around 40 percent of first-time, full-time students receiving Pell grants complete bachelor's degrees within 6 years. In addition, a growing body of research indicates that schools either raise their prices or lower their own institutional aid in response to Pell grants. Sequestration would, however, translate likely into higher fees on student loans. This would be a small move in the right direction, towards aid that places more of payment burden on the people consuming the education. The huge ill effects of super abundant third-party money in higher education are revealed in sticker price inflation that eclipses the inflation rate of even healthcare, dismal completion rates in colleges, and one-third of bachelor's degree holders occupying jobs that don't require the credential. Federal financial aid, by making students less sensitive to the real costs of their education and enabling colleges to briskly raise prices, actually defeats its affordability goal. In addition to increasing fees for student loans, sequestration would require that cuts be made to aid that Washington provides to institutions, as well as research in colleges and universities. The former should be of little concern. Federal funding mainly translates into inefficiency, and Washington provides only a minute sliver of overall funding directly to institutions. Regarding research, while much research is of value, it is likely not of greater value than getting the Nation's shambles of a fiscal house in order. In addition, research by Austan Goolsbee, the former chairman of the Council of Economic Advisors, found that a large portion of Federal research and development funding translates not into greater innovation but higher salaries for researchers. PREPARED STATEMENT The Federal Government has accumulated an almost unimaginably huge debt, and sequestration offers but a small first step toward addressing it. Thankfully, cuts can be made, in fact, need to be made to Federal education programs. Thank you. And I look forward to your questions. [The statement follows:] Prepared Statement of Neal P. McCluskey Chairman Harkin, members of the subcommittee: thank you for inviting me to speak with you today. My name is Neal P. McCluskey and I am the associate director of the Center for Educational Freedom at the Cato Institute, a nonprofit, nonpartisan public policy research organization. My comments are my own and do not represent any position of the institute. Cuts such as those that would be made to Federal education programs through sequestration are both necessary and overdue. Not only does the Federal Government have no constitutional authority to fund and administer education programs--no mention is made of education in the specific, enumerated powers given to the Federal Government in Article I, Section 8--but the last 40-plus years of Federal involvement in education provide a clear demonstration of futility. Start with preschool. The primary Federal preschool program is Head Start, which in fiscal year 2012 received almost $8 billion. The program has existed since 1965 and has cost roughly $180 billion through its lifespan. Despite its longevity, the program has failed to demonstrate lasting benefits. Indeed, a 2010 Federal study found that the program had only two statistically significant positive cognitive effects that lasted through first grade, and negative mathematics effects for kindergarten students who entered Head Start when 3 years old.\1\ In the vast majority of measures no meaningful effects were found one way or the other. --------------------------------------------------------------------------- \1\ Michael Puma, et al., ``Head Start Impact Study Final Report: Executive Summary,'' U.S. Department of Health and Human Services, http://www.acf.hhs.gov/programs/opre/hs/impact_study/reports/ impact_study/executive_summary_final.pdf January 2010. --------------------------------------------------------------------------- Unfortunately, the essentially nonexistent positive effects of Head Start are not the program's only problem. As reports from the Government Accountability Office (GAO), local media outlets, and other sources have revealed, Head Start has long suffered from serious waste and abuse. Indeed, GAO reports in 2000, 2005, and 2008 found widespread noncompliance with financial management standards and very poor efforts to remediate the problem.\2\ --------------------------------------------------------------------------- \2\ Tad DeHaven, ``Head Start and Other Subsidies,'' Downsizing the Federal Government, http://www.downsizinggovernment.org/hhs/ subsidies#_edn3, September 2010. --------------------------------------------------------------------------- Next there are Federal elementary and secondary education programs, a category that, according to the Federal ``Digest of Education Statistics,'' accounted for almost $79 billion in 2011.\3\ --------------------------------------------------------------------------- \3\ National Center for Education Statistics, Digest of Education Statistics, 2011, Table 386, http://nces.ed.gov/programs/digest/d11/ tables/dt11_386.asp. --------------------------------------------------------------------------- As Figure 1 illustrates, on a per-pupil basis, inflation-adjusted Federal spending on K-12 education has grown immensely over the last several decades, ballooning to 375 percent of its 1970 value by 2010. And this increase did not just compensate for funding losses in at the State and local levels. As Figure 2 shows, overall per-pupil expenditures through high school graduation have nearly tripled since 1970. Meanwhile, mathematics, reading, and science scores on the National Assessment of Educational Progress (NAEP), the Federal testing regime often called ``The Nation's Report Card,'' have been almost completely stagnant for 17-year-olds, the ``final products'' of our elementary and secondary education system. inflation-adjusted federal k-12 spending per pupil and achievement of 17-year-olds, percent change since 1970 [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT] Figure 1. inflation-adjusted cost of a complete k-12 public education and percent change in achievement of 17-year-olds since 1970 [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT] Figure 2. Rightly, the primary concern for many people is that sequestration would deal a crippling blow to academic achievement. The NAEP and spending data, however, simply do not justify this. Indeed, they powerfully illustrate that we haven't gotten any lasting bang for our Federal or overall education bucks, and those expenditures could be reduced considerably without ill achievement effects. Indeed, it is quite likely that Federal education dollars keep recipient districts from having to take politically difficult but necessary actions to increase the efficiency of their operations. Directly connected to the efficiency question, it seems that the most pressing concern for some people is not the academic effect that sequestration might have on education but the employment effect. And job losses would ensue: High-end estimates of elementary and secondary job losses from sequestration in 2013 published by the National Education Association predict decreases of 46,000 jobs.\4\ That certainly appears to be a large number, and no one wants to see anyone lose employment. But the Federal Government has an immense, nearly $16 trillion debt, and as Figure 3 shows, huge increases have occurred in school staffing relative to enrollment. Coupling that with the achievement data in Figures 1 and 2, it is clear that much heftier staffing has not created better outcomes. --------------------------------------------------------------------------- \4\ National Education Association, ``Impact of Sequestration on Federal Education Programs,'' http://www.nea.org/assets/docs/ Impact_of_Sequestration_on_Federal_Education_ Programs_Reformatted_06-26-12.pdf, July 12, 2012. Total was calculated by summing total job losses in categories listed on previous page that would likely impact elementary and secondary education. --------------------------------------------------------------------------- percent change in public school employment and enrollment since 1970 [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT] Figure 3. Public schooling is supposed to educate children efficiently and effectively, but it has very much been treated as a jobs program instead. That has done no discernible educational good and contributed to the Nation's mammoth debt. Originally, Federal K-12 funding was meant to operate in a compensatory fashion. But at least the recent evidence suggests that no major, nationwide funding inequities exist. According to the Federal Condition of Education, districts with the highest levels of poverty have spent essentially the same amount on a per-pupil basis as have those with the lowest level of poverty since 1997-1998. And both have appreciably outspent districts with middling levels of poverty since 1995-1996 (the first year for which data is available).\5\ Those numbers should be updated (the final school year with data is 2006- 2007), but there is no meaningful evidence that the pattern has appreciably changed. --------------------------------------------------------------------------- \5\ National Center for Educational Statistics, The Condition of Education, Figure 36-1, http://nces.ed.gov/programs/coe/ indicator_pex.asp. --------------------------------------------------------------------------- Our public schools have, essentially, been on a decades-long hiring binge with ultimately no gains to show for it. And a reduction of 46,000 jobs would be miniscule compared to overall public-school staffing, which well exceeds 6 million people.\6\ --------------------------------------------------------------------------- \6\ The latest staffing data from the Digest of Education Statistics, 2009 puts public-school employment at 6.36 million people. National Center for Education Statistics, ``Digest of Education Statistics, 2011,'' Table 85, http://nces.ed.gov/programs/digest/d11/ tables/dt11_085.asp. --------------------------------------------------------------------------- Last, let's turn to higher education. Regrettably, Pell grants have been exempted from sequestration, taking roughly $42 billion off the table. This might be understandable were Pell grants shown to effectively enable low-income students to enter and complete college without pushing sticker prices higher, but such is not the case. While conclusive data are not available, The Center for College Affordability and Productivity estimates that only around 40 percent of first-time, full-time students receiving Pell grants complete bachelor's degrees within 6 years.\7\ In addition, a growing body of research indicates that schools either raise their prices or lower institutional aid in response to Pell grants.\8\ --------------------------------------------------------------------------- \7\ Richard Vedder, ``Only 40 Percent of Pell Grant Recipients Get Bachelor's Degrees,'' Chronicle of Higher Education, http:// chronicle.com/blogs/innovations/only-40-percent-of-pell-grant- recipients-get-bachelor-degrees/30139, September 6, 2011. \8\ John D. Singell, Jr., and Joe A. Stone, ``For Whom the Pell Tolls: The Response of University Tuition to Federal Grants-in-Aid,'' Economics of Education Review 26, no. 3 (2006): 285-95; Lesley J. Turner, ``The Incidence of Student Financial Aid: Evidence from the Pell Grant Program,'' Columbia University Working Paper, April 2012; Stephanie Riegg Cellini and Claudia Goldin, ``Does Federal Student Aid Raise Tuition? New Evidence on For-profit Colleges,'' NBER Working Paper No. 17827, National Bureau of Economic Research, February 2012. --------------------------------------------------------------------------- While Pell grant is off-limits, sequestration will translate into higher fees on student loans. This might seem like it would make college less affordable for students, but it would be a very small move in an absolutely necessary direction for Federal student aid: towards aid that places more of payment burden on the people consuming the education. The huge ill effects of too much third-party money in higher education, especially from the Federal Government, are plain to see: --``sticker price'' inflation that eclipses even that even in healthcare; \9\ --dismal completion rates; \10\ and --one-third of bachelor's degree holders occupying jobs that do not require the credential.\11\ Federal financial aid, by making students less sensitive to the real costs of their education and enabling colleges to briskly raise prices, defeats both the affordability goal of the aid and has helped to render higher education extremely inefficient. Any moves in the direction of having students bear more of the cost of their education would, perhaps counter intuitively, result in greater long-term college affordability by forcing schools to lower prices and cut abundant waste. --------------------------------------------------------------------------- \9\ For empirical evidence that student aid helps fuel tuition inflation, in addition to the studies cited in note 8 see those cited at Neal McCluskey, ``The Student Aid `Myth' Myth,'' Cato&Liberty, http://www.cato-at-liberty.org/the-student-aid-myth-myth/, December 8, 2011. \10\ No sector of higher education has higher than 65.4 percent 6- year graduation rates for 4-year programs, and for public 2-year institutions (community colleges) only 20.4 percent of first-time, full-time students finish within 150 percent of ``normal'' time. National Center for Education Statistics, Digest of Education Statistics, 2011, Table 345, http://nces.ed.gov/programs/digest/d11/ tables/dt11_345.asp. \11\ Anthony P. Carnevale and Stephen J. Rose, ``The Undereducated American,'' Georgetown University Center on Education and the Workforce, http://www9.georgetown.edu/grad/gppi/hpi/cew/pdfs/ undereducatedamerican.pdf, June 2011. --------------------------------------------------------------------------- In addition to increasing fees for student loans, sequestration would require that cuts be made to aid that Washington provides to institutions, and as well as to research occurring in colleges and universities. The former cuts should be of little concern: Not only does Federal funding mainly appear to translate into inefficiency, but Washington provides only a small sliver of overall funding directly to institutions. In 2011, such Federal aid tallied just slightly more than $1 billion, versus the roughly $85 billion State and local governments furnished to public colleges for general operating expenses in the 2011-2012 academic year.\12\ Trimming just part of this relatively tiny Federal amount would have a negligible effect. --------------------------------------------------------------------------- \12\ Federal appropriations to schools calculated using U.S. Department of Education, ``Education Department Budget History Table,'' http://www2.ed.gov/about/overview/budget/history/edhistory.pdf, August 5, 2011. State and local appropriations from State Higher Education Executive Officers, ``State Higher Education Finance: fiscal year 2011,'' Figure 2, http://www.sheeo.org/finance/shef/SHEF_fiscal year 11.pdf, 2012. --------------------------------------------------------------------------- Regarding research, while much research is of value, it is very difficult to say it is of greater value than getting the Nation's shambles of a fiscal house in order. In addition, research by Austan Goolsbee, the former chairman of the Obama Administration's Council of Economics Advisors, found that a large portion of Federal funding for research and development translates not into greater innovation but higher salaries for researchers.\13\ Like aid to students, the benefits seem largely to accrue to those employed by the money, not to society or the people the aid is intended to help. --------------------------------------------------------------------------- \13\ Austan Goolsbee, ``Does Government R&D Policy Mainly Benefit Scientists and Engineers?'' The American Economic Review 88, no. 2 (1998): 298-302. --------------------------------------------------------------------------- The Federal Government has accumulated an almost unimaginably huge debt, and sequestration offers only a small first step toward addressing spending recklessness. Thankfully, significant cuts can almost certainly be made to discretionary spending without adversely affecting the activities that Federal money is supposed to advance. Education is a perfect example of this, with overwhelming evidence revealing that Federal spending has, at best, done no overall good, and has quite likely caused appreciable harm. It has insulated Head Start providers, schools and districts, and colleges from pressures to become efficient and effective, and has taken funds from taxpayers in order to greatly increase education employment and the comfort of those working in colleges and universities. Trimming such wasteful funding, as sequestration would do, would be but an opening move in the right direction. Senator Harkin. Thank you, Mr. McCluskey. And now we'll turn to Dr. Tammy Mann. Please proceed. STATEMENT OF TAMMY L. MANN, Ph.D., PRESIDENT AND CEO, THE CAMPAGNA CENTER, ALEXANDRIA, VIRGINIA Dr. Mann. Thank you. Good morning, Chairman Harkin and Ranking Member Shelby, thank you for the opportunity to testify today about the potential impact of impending sequester of nondefense discretionary programs, in particular, early childhood education programs. I have been privileged to serve as president and CEO of The Campagna Center in Alexandria for the past year and have worked in the field of early childhood education for the better part of 20 years. The Campagna Center currently serves more than 1,700 children through a range of early childhood, school age, youth, and family-development programs designed to empower and engage parents as they address their children's academic and social needs. We, like many other early childhood centers across the country, successfully blend, braid, and leverage a multitude of local, State, and Federal funding with private investment and shared community resources to provide the highest quality services to the most vulnerable families in Alexandria. The looming 7.8-percent cut to nondefense discretionary programs will have serious, immediate, and disruptive impact on vulnerable children and families we serve. Due to increases in our operating costs over the past few years, in particular deferred maintenance, health insurance for staff, rising utility costs, we simply do not have the budget cushion to withstand this large of a reduction without cutting children, families, and staff from our program. We know that the Congress is committed to Head Start. Over the past few years, there has been solid bipartisan support for the quality early childhood education, and Head Start has not had to cut children from its programs. However, we work hand in hand with childcare services and other early learning programs, especially those funded or supplemented with State dollars. Over the last year, States across the country have made significant cuts to childcare and pre-K programs. The ripple effects of this, combined with further cuts via sequestration, will be devastating to early learning across the country. In Virginia alone, it is estimated that more than 800 children and their families would no longer receive federally funded childcare assistance. Without such assistance, families will be faced with the difficult decision of what to do with their children while at work, unfortunately, choices that can lead to children being placed in unsafe environments or their parents being forced to reduce their hours or even quit their jobs. For Head Start and Early Head Start, the cut would equate to the loss of roughly 1,100 children and their families in the State, according to the National Head Start Association. My agency, The Campagna Center, is a delegate of the city of Alexandria. And among the children we serve, we are funded to provide assistance to 309 Head Start children and 108 Early Head Start children as a grantee. A cut of this magnitude would mean that approximately 24 fewer children would be served in Head Start and 10 fewer in Early Head Start. Currently, we have to raise an additional $75,000 each year just to be able to continue providing quality services to our Early Head Start children, because the current funding level has not been able to address our rising costs. This is in addition to the 20-percent non-Federal share match that we have to provide to operate the program. There is simply no way we could absorb a cut as deep as proposed with other funding sources in this very challenged economic environment. Additionally, due to the economic woes, the need in our community has grown much faster than our ability to provide services. As a city, Alexandria has deep pockets of poverty that greatly undermine many families' abilities to pay for early childhood services. Last year, we had 206 children on our waitlist for Head Start and 169 for Early Head Start. Unfortunately, we expect this number to keep growing even without facing deep cuts. For our program's spring enrollment fair, we had well over 500 parents seeking a spot for their children in our program. Any cuts in funding would certainly push more families onto long waiting lists, where the chance to gain access to early childhood education is slim to none. In addition to the depth of the cut, one of our greatest fears is the timing. A January 2013 target date for these cuts go into effect is right in the middle of the program year for us as well as our K-12 colleagues. Just recently, I had the opportunity to talk with a parent that knows firsthand how much Head Start has meant to her. The mother came to our program in 2010 after having experienced a divorce and was in need of assistance on many levels. With very little family support and few resources at her disposal, she was concerned about how she was going to make ends meet and provide for her children. In 2 short years, despite becoming homeless, her oldest child has thrived in our program, and has since successfully completed kindergarten, and is doing very well in school. This parent has been able to enter a training program that has her close to earning her child development associate credential, and she is gainfully employed as a teacher assistant and very much motivated to do what it takes to continue her own education and support her children's education. She credits her success to the support she has received from teachers, home visitors, and family support staff in our program. This mother's story reflects the story of many parents who have come to rely on Head Start and other early care and education programs that support child and family success. It's clear that cuts in this area will have lasting impact. Quality early education prepares the Nation's youngest children for a lifetime of learning and success. In fact, studies show that for every $1 invested in a Head Start, society earns at least $7 through increased earnings, employment, family stability, as well as decreased welfare dependency, healthcare costs, crime costs, grade retention, and special education. PREPARED STATEMENT I firmly agree that our national deficit is a looming problem. As an advocate serving children, I too am concerned about leaving significant debt behind to be paid for by the next generation. On behalf of my colleagues across the country, I urge this subcommittee to take a leadership role in finding a balanced approach that averts the sequester and ensures that this deficit reduction effort is not financed with cuts to programs that help our most vulnerable citizens. Hundreds of thousands of children and families in your home States are counting on it. Thank you. [The statement follows:] Prepared Statement of Tammy L. Mann, Ph.D. Chairman Harkin and Ranking Member Shelby: Thank you for the opportunity to testify today about the potential impact of the impending sequester of nondefense discretionary programs, in particular, early childhood education programs supported through Head Start, Early Head Start, and Child Care funding. I have been privileged to serve as president and CEO of The Campagna Center, in Alexandria, Virginia, for the past year and have worked in the field of early childhood education for more than 20 years. The Campagna Center serves more than 1,700 children through a range of early childhood, school age, youth, and family development programs designed to empower and engage parents as they address their children's academic and social needs. We, like many other early childhood centers across the country, successfully blend, braid, and leverage a multitude of local, State, and Federal funding with precious private investment and shared community resources to provide the highest quality services to the most vulnerable families in Alexandria. The looming 7.8-percent cut to nondefense discretionary programs will have serious, immediate, and disruptive impact on the vulnerable children and families we serve. Due to increases in our operating costs over the past few years, in particular deferred maintenance, health insurance for staff, and rising utility costs, we do not have the budget cushion to withstand this large of a reduction without cutting children, families, and staff from our program. Nationally, the Department of Health and Human Services estimates that this cut, via sequestration, will result in 100,000 fewer children receiving Head Start and Early Head Start services, and 80,000 fewer children receiving child care assistance. We know that the Congress is committed to Head Start--over the past few years there has been solid bipartisan support for quality early childhood education and Head Start has not had to cut children from its programs. However, we work hand-in-hand with child care services and other early learning programs, especially those funded or supplemented with State dollars. Over the last year, states across the country have made significant cuts to child care and pre-K programs. The ripple effects of this, combined with further cuts via sequestration, will be devastating to early learning across the country. In Virginia alone, it is estimated that more than 800 children and their families would no longer receive federally funded child care assistance. Without child care assistance, families will be faced with the difficult decision of what to do with their children while at work. Unfortunately, that choice can lead to kids being put in unsafe environments or their parents forced to reduce their hours or even quit their jobs. For Head Start and Early Head Start, the cut would also equate to the loss of roughly 1,140 children and their families in the State, according to the National Head Start Association. My agency, The Campagna Center, is a delegate agency of the city of Alexandria and among the children we serve, we are funded to provide assistance to 309 Head Start Children and 108 Early Head Start children as a grantee. A cut of this magnitude would mean that approximately 24 fewer children would be served in Head Start and approximately 10 fewer in Early Head Start. Currently, we have to raise an additional $75,000 each year just to be able to continue providing quality services to our Early Head Start children because the current funding level has not been able to address our rising costs; this is in addition to the 20 percent non-Federal match that we have to provide to operate the program. There is simply no way we could absorb a cut as deep as proposed with other funding sources in this very challenged economic environment. Teacher and Teacher Assistant jobs would be lost, as well as reductions in time for staff that support our teachers--Family Service Support professionals, Nutrition Specialists, and others that are vital to the life success of our children. Additionally, due to economic woes, the need in our community has grown much faster than our ability to provide services. As a city, Alexandria has deep pockets of poverty that greatly undermine many families' ability to pay for early childhood services. Last year we had 206 children on our waitlist for Head Start and 169 children on the Early Head Start waiting list. Unfortunately we expect this number to keep growing even without facing deep cuts; for our program's Spring enrollment fair, we had well over 500 parents seeking a spot for their children in our program. Any cuts in funding would certainly push more families onto long waiting lists, where the chance to gain access to early childhood education is slim to none. In addition to the depth of the cut, one of our greatest fears is its timing. January 2013, the target date these cuts go into effect, is right in the middle of the program year for us as well as our K-12 colleagues. We simply do not know how we can possibly tell families that their services will lapse come January. These services are critical to helping stabilize at-risk families, so that their children will be assured a home environment that nurtures a lifetime of learning and success. Just recently, I had the opportunity to talk with a parent that knows firsthand how much Head Start has meant to her family. This mother came to our program in 2010 following a divorce and was in need of assistance on many levels. With very little family support and few resources at her disposal, she was concerned about how she was going to make ends meet and provide for her children. In 2 short years, despite becoming homeless, her oldest child thrived in our program, has since successfully completed kindergarten, and is doing very well in school. This parent has been able to enter a training program that has her close to earning her Child Development Associate credential and she is gainfully employed as a teacher assistant and very much motivated to do what it will take to continue her education and support her children's education. She credits all of this success to the support she received from teachers, home visitors, and family support staff in our program. This mother's story reflects the story of many parents who have come to rely on Head Start and other early care and education programs that support child and family success. Cuts in this area will have lasting impact. Quality early education prepares the Nation's youngest children for a lifetime of learning and success. In fact, studies show that for every $1 invested in a Head Start child, society earns at least $7 through increased earnings, employment, and family stability; \1\ as well as decreased welfare dependency,\2\ healthcare costs,\3\ crime costs,\4\ grade retention,\5\ and special education.\6\ --------------------------------------------------------------------------- \1\ Ludwig, J. and Phillips, D. (2007). The Benefits and Costs of Head Start. Social Policy Report. 21 (3: 4); Deming, D. (2009). Early childhood intervention and life-cycle skill development: Evidence from Head Start. American Economic Journal: Applied Economics, 1(3): 111- 134; Meier, J. (2003, June 20). Interim Report. Kindergarten Readiness Study: Head Start Success. Preschool Service Department, San Bernardino County, California; Deming, D. (2009, July). Early childhood intervention and life-cycle skill development: Evidence from Head Start, p. 112. \2\ Meier, J. (2003, June 20). Kindergarten Readiness Study: Head Start Success. Interim Report. Preschool Services Department of San Bernardino County. \3\ Frisvold, D. (2006, February). Head Start participation and childhood obesity. Vanderbilt University Working Paper No. 06-WG01; Currie, J. and Thomas, D. (1995, June). Does Head Start Make a Difference? The American Economic Review, 85 (3): 360; Anderson, K.H., Foster, J.E., & Frisvold, D.E. (2009). Investing in health: The long- term impact of Head Start on smoking. Economic Inquiry, 48 (3), 587- 602. \4\ Reuters. (2009, March). Cost of locking up Americans too high: Pew study; Garces, E., Thomas, D. and Currie, J. (2002, September). Longer-term effects of Head Start. American Economic Review, 92 (4): 999-1012. \5\ Barnett, W. (2002, September 13). The Battle Over Head Start: What the Research Shows.; Garces, E., Thomas, D. and Currie, J. (2002, September). Longer-Term Effects of Head Start. American Economic Review, 92 (4): 999-1012. \6\ NHSA Public Policy and Research Department analysis of data from a Montgomery County Public Schools evaluation. See Zhao, H. & Modarresi, S. (2010, April). Evaluating lasting effects of full-day prekindergarten program on school readiness, academic performance, and special education services. Office of Shared Accountability, Montgomery County Public Schools. --------------------------------------------------------------------------- I firmly agree that our national deficit is a looming problem; as an advocate serving children, I too am concerned about leaving significant debt behind to be paid for by the next generation. On behalf of my colleagues across the country, I urge this subcommittee to take a leadership role in finding a balanced approach that averts the sequester and ensures that this deficit reduction effort is not financed with cuts to programs that help our most vulnerable citizens. Hundreds of thousands of children and families in your home States are counting on it. Thank you. Senator Harkin. Thank you, Dr. Mann. Thank you all very much for your testimony. As I said, your whole testimonies will be made a part of the record. We'll start a round of 5-minute questions. First, Tammy Mann, Dr. Mann, last April, I went down to the U.S. Chamber of Commerce, and their affiliate had issued a report calling for more investment in early childhood education. Not less, more. This is the U.S. Chamber of Commerce. Coming from a business community to unite in an effort to convince us, and I assume people on the local level and everywhere else, to invest more in early childhood education. So I want to point out this concern is also coming from the business community, but it's not just recent. In 1990--it was either 1990 or 1992, the Committee on Economic Development was headed by the president and CEO of Honeywell at that time. It came out with a report on what needed to be done on education in America from a business standpoint, from a business community standpoint, what needed to be done. And their entire report was focused on putting more into early childhood education, early learning programs. That was 1990 or 1992, I forgot exactly which year. So again, the business community this year stepped up again. But we never seem to quite get there. For both you and Dr. Walker, your statements read--or Dr. Walker, your statement--the concept of doing more with less is admirable, but there comes a time when there's not enough left adequately and equitably to educate the children of America. Dr. Atkinson, you said our State and local education agencies (LEAs) are currently running on shoestring budgets and cannot afford additional cuts. For both of you, what kinds of things have you done already to reduce costs? And if sequestration goes into effect, where are you going to go for this extra money? Can you go to your local jurisdiction, your States? Can you address it yourself? Where would you get that lost revenue, or would you just have to lay off teachers and cut services? Dr. Atkinson. North Carolina has no place to go. We have moved very aggressively to become more efficient and more effective in our delivery of public education. Harvard just recently issued a report indicating that North Carolina was one of six States getting the most gain of student achievement with the incremental dollars that we have. We ranked 45th in the Nation, according to the 2010 census for educational spending. Our instructional resources budget has been cut 50 percent. Senator Harkin. Excuse me. You ranked 45th out of 50 States in educational spending? Dr. Atkinson. That's correct, Sir. Senator Harkin. So you're at the bottom? Dr. Atkinson. Yes, we are. And not only are we at the bottom, our school districts will face about $190 million less money to serve 12,000 more students along with our 1.5 million children that we have in our State. Through Race to the Top dollars--thank goodness--we have been able to continue to build a more efficient and effective system where we can have some economies of scale, such as instead of our 115 school districts doing requests and proposals for services, we want to do it one time for our 115 school districts. We have started a virtual high school, the second largest in the Nation. That virtual high school supplements instruction in schools where they could no longer have teachers, and it helps our rural schools in the State to offer more opportunities. We have been cutting and cutting. We have approximately 5 percent of our budgets spent in administration. That's one of the lowest in the Nation, and I'm sure that any business would be very proud to have an administrative cost at 5 percent. We have made cuts in teacher assistance. We've had to eliminate more than 6,000 positions over the last couple of years. So we have no place to go to get to make up for the difference that would occur should sequestration take place. North Carolina is a State that has had its share of hurricanes, and we've been trying to build and we are well on our way to building a very strong foundational house, but sequestration would be like a hurricane coming through and blowing off the roof of what we have done to move us to the place where nearly 100 percent of our students can graduate from our schools prepared with options. Senator Harkin. Mr. Walker. Dr. Walker. Yes, Sir. Learning is the byproduct of good teaching. And in order to have learning, we have to have the people. And so over the last couple of years, we've actually already started reducing our staff, which means larger class sizes. For example, we've reduced an English teacher, a math teacher, a science teacher at the high school level; reading specialists--one at the elementary, one at the middle school; a librarian; a facility planner; a person in our curriculum department at the campus level. Senator Harkin. So has the number of your students decreased at the same time? Dr. Walker. No, Sir. Our numbers have stayed the same. We're having to put more students in the classroom now. No pay raises. So, essentially, what we're having to do is we're having to look at our personnel. We eliminated the baseball, swimming, and cross-country programs, but we did that in order to keep our elementary art, our elementary music, our secondary theater arts, music programs, all those programs in the fine arts. We're trying to keep a balance. But, ultimately, Sir, when it all boils down and you look at it, we have to touch people's lives and we have to reduce our staff. And at some point, we have to have a bare minimum to operate to take care of the Federal and State mandates for educating our children. Senator Harkin. Thank you. Senator Shelby. Senator Shelby. Thank you, Senator Harkin. It's been estimated that the Federal contribution, on average, is about 10.8 percent of a local school district's total funding. I think that's nationwide. On a local level, this means that an automatic cut, for example, of 7.8 percent to the Federal share for an average school district would equal a cut of about 84 percent of its total funding. I know you don't want to cut anything. I agree with you that sequestration is not the way to do it. You know, we're going to have to do things in the future a little differently up here, because we're challenged economically, as we all know, just as you are in North Carolina, you are in Texas, you are in Virginia. My people in Alabama, we understand that. Mr. McCluskey, I want to direct my first question to you. First of all, I believe access to a quality education is critical to the success of our citizens and the competitiveness, as has been a said here, of our Nation in the global economy. However, there is not always a strong correlation between spending and outcomes. We know that. Since 1970, Federal education spending on a per-pupil basis has increased from $435 to $1,159 in 2008. Yet according to the most recent performance report ranking 15-year-olds from the 34 countries of the Organization for Economic Cooperation and Development (OECD), the United States ranked 25th in math and 17th in science. Can the approximate 7.8-percent cuts we've been talking about under sequestration be taken without adversely affecting student achievement? Mr. McCluskey. I think the overwhelming evidence, and a lot of it I laid out in my testimony, is that we have spent huge amounts of money. We've had gigantic increases and sustained over decades. And it simply hasn't, in any way, translated into better outcomes, into better performance, and it's the Federal Government's own test that shows that, the National Assessment of Educational Progress. And you bring up the international data, and that's also interesting, because we spend more than almost any other Nation in the OECD on education and still get very poor results. Senator Shelby. But the outcome is different, isn't it? Mr. McCluskey. What's that? Senator Shelby. The outcome, considering what other nations spend and what we spend. Mr. McCluskey. Absolutely. So they do much better on, usually, much less spending per pupil. We can talk about this as an investment, but if it is an investment, it's an investment that's been paying no return for decades. And considering the size of the debt and considering that this is money that comes from taxpayers who might be able to use it for much more efficient things that they really need, I can't see how it can be justified to continue spending like this. Senator Shelby. Dr. Atkinson, if cuts still need to be taken to education funding, and I think we're going to have to look at everything up here whether we want to or not, and it was up to individual States, for example, to make these cuts, what specific programs would you target and what innovative strategies would you support to achieve some efficiencies in education, because I do believe whether it's defense, whether it's education, or whether it's health, that they are some efficiencies there that we should all strive to get to. What would you suggest, if any? Dr. Atkinson. I believe that my colleagues across the Nation would agree that should sequestration have to occur, and should cuts have to occur, that States must be offered flexibility in making cuts where we see through our data that we are not as effective or efficient in one area as we would be in another. So we need to offer that flexibility to States, because it may not be the same in all of our States where we see inefficiencies and ineffectiveness. I believe that we also must work collaboratively to get efficiencies. For example, the adoption of the common core standards is a good example of how States can come together, focus on the common standards, share resources dealing with professional development, share resources as it relates to helping students understand the content and to apply that content. There are other examples with online professional development. There are other examples that can be used in having accessible to all of our States online instruction that can complement or supplement the instruction that a teacher would provide in the classroom. Senator Shelby. Dr. Walker, I voted against the sequestration legislation, as the Mr. Chairman did, that brought us where we are today. But if it does come about, would it be better to deal with it now as opposed to kicking the can down the road if you had a little certainty there? Dr. Walker. Absolutely, Sir. Senator Shelby. Thank you, Mr. Chairman. Senator Harkin. Thank you. It's true we both voted against it, but I think I voted against it because it raised no revenue and---- Senator Shelby. Probably for different reasons. Senator Harkin. And you probably voted against it because it didn't cut enough. So different reasons. Senator Shelby. I didn't say we voted against it for the same reason. Senator Harkin. Let's see, I just wanted to cover one other thing here. Yes, Mr. McCluskey, I had one thing I wanted to ask you about in your testimony here. You know, I always like it when people cite studies and stuff, but I found in my long career here that when you cite a study that's been cited by somebody else, been cited by somebody else and cited by somebody else, it's going to take on a life of its own. But you really don't know what the real facts are. So just to read, in your testimony, you said that, ``Indeed, GAO reports in 2000, 2005, and 2008 found widespread noncompliance with financial management standards and very poor efforts to remediate the problem.'' We're talking about Head Start. This is Head Start. You said, ``As reports in the Government Accountability Office, local media outlets, and other sources have revealed, Head Start has long suffered from serious waste and abuse. Indeed, GAO reports in 2000, 2005, and 2008 found widespread noncompliance with financial management standards and very poor efforts to remediate the problem.'' I was very intrigued by that, since I was here in those years and was on this subcommittee, either as ranking member or chair, and I didn't remember those, so I asked my staff to look at it. What we found out was that the GAO study found possible abuse of eligibility rules. This is where kids may have been--their families may have been more than 100 percent of poverty but their kids were in the Head Start program. And they found this in eight Head Start centers. Do you know how many Head Start centers are in the country, Mr. McCluskey? Mr. McCluskey. Quite a few. Senator Harkin. Sixteen hundred. So I question the usage of your words ``widespread noncompliance.'' I'm sure that somebody else may pick up your citing of this and then cite the study in something else and then it takes on a life of its own. But I doubt that finding possible abuse of eligibility rules at 8 out of 1,600 Head Start centers is an indictment of widespread noncompliance and poor efforts to remediate the problem. Mr. McCluskey. In fact, I'm not the only one I think who's found evidence of this and acted on it. In fact, the Obama administration has undertaken a new effort to impose some sort of accountability on Head Start centers due to widespread problems, at least what they are perceiving as widespread problems, within Head Start of financial management and things like this. So I don't think I am the only one who senses a problem in this area. The Obama administration seems to be working on that expectation or thought that's out there as well. Senator Harkin. Well, again, maybe your definition of ``widespread'' is a little bit different than mine, but 8 of 1,600 doesn't seem widespread. Everything has problems. We always try to focus on how we can do things better. I understand that. But I don't know that that's an indictment of the Head Start program. Mr. Walker, I wanted to ask you, you said in your testimony--you mentioned something. I heard it. You said something about State and Federal mandates in education. What do you mean by Federal mandates in education? Dr. Walker. One of the mandates that we deal with is, is dealing with Individuals with Disabilities Education Act (IDEA), with some of the issues that come out of No Child Left Behind, dealing with the testing requirements that we're under. It flows through the State, but it's through No Child Left Behind. There are various areas that we have that we have to act and we have to do things, and that's what I term a mandate. Senator Harkin. Let me address myself to one of those, IDEA. There is, I think, a mistaken perception, hearing from you, a well-known educator, that IDEA, the Individuals with Disabilities Education Act, is a Federal mandate. It is not a Federal mandate. It's a constitutional mandate. You see, under the Constitution of the United States, no State has to provide a free public education. There's no constitutional mandate that says that any State has to provide a free public education. What the Constitution does say, however, as the Supreme Court has interpreted over the years, is that if a State does provide a free public education, it cannot just provide a taxpayer-based free public education for white boys. It cannot just provide a free taxpayer-funded public education for Christian boys and girls. The Supreme Court has said that you can't discriminate based on race, sex, or natural origin, et cetera, et cetera. A case came before the circuit court for Pennsylvania--PARC v. Pennsylvania--PARC, P-A-R-C--Pennsylvania Association for Retarded Citizens vs. Pennsylvania. Here, I'm into trouble-- early 1970s, I believe. In which some parents of kids with disabilities-- intellectual disabilities--brought about a case saying that their kids were being discriminated against. They were taxpayers, and their kids were not being given a free, appropriate public education. The district court found for the parents. It was appealed to the circuit court. The circuit court upheld that, and the Supreme Court denied it. The Supreme Court was saying, you're right, this is a constitutional requirement. You cannot discriminate on the basis of disability, if you're going to have a free public education. The Federal Government came along--then I came to Congress. The Federal Government comes along and says, well, and the States came to the Federal Government and said, my gosh, now we are going to have to educate kids with disabilities. It's a constitutional requirement just like we have to educate girls now. We have to educate African-Americans. We have to educate new immigrants who come into this country. So the States came and said, my gosh, this is going to be a new burden. The Federal Government said, okay, I'll tell you what we'll do, we'll make a deal. We'll provide funding to help meet this constitutional requirement you have, but here are some of the things you have to do if you want some of the Federal money. You don't have to take the Federal money. But if you do, here are some of the requirements you have to meet. And the Federal Government at the time, it was our goal to have the Federal Government pay for at least 40 percent of the increased cost, whatever it might cost to educate the kids with a disability, that we would pay for 40 percent of it, as a goal. It wasn't guaranteed, but that was the goal. I've been involved in trying to reach that goal for 30 years. We've never made it. We got it up a little bit under the American Recovery and Reinvestment Act, but that went away. But be that as it may, the requirement that every school district--yours, too--educate kids with disabilities is not a Federal mandate. It's a constitutional requirement. Even if there were no IDEA at all, you would still have to educate those kids with a disability. Not a Federal mandate whatsoever. The only mandate is if you take the money, you have to meet certain requirements in terms of IDEA. You don't have to take the money. So I just wanted to make that clear, that a lot of times, there are Federal mandates. But many times they're not Federal mandates; they're constitutional requirements that we have to meet in order not to discriminate against one class or another of our citizens. Now, No Child Left Behind, again, yes, there are mandates in No Child Left Behind, Federal mandates. Again, those come basically through title I funding. If a State wants title I funding, here is what you have to do. I will point out again and again, as I point out as chairman of this subcommittee and as chairman of the authorizing committee, no State has to take title I money. There is no requirement for any State that you must take Federal money for education. If you want it, then here are the requirements you have to meet. I have my own problems with No Child Left Behind. That's why I worked with Senator Enzi on the authorizing committee, not the appropriating committee, authorizing committee, to pass legislation to get rid of No Child Left Behind, because I came to the conclusion that it was a bad piece of legislation. So we got it through our committee, but we can't get it through the Senate floor right now. But those are the things that we have to work on. But again, I always point out that there is no requirement that any State has to take that money. If a State wants to, they can pay for all their education all by themselves. But even if a State did, even if North Carolina decided to pick up everything, they still can't violate the Constitution of the United States as long as they're a State in this Union. So when we think about these mandates, just be careful about whether we say they are a Federal mandate or are they a constitutional requirement that taxpayers--a State cannot use taxpayer money to come in and just do it for one class of people and discriminate against another class of people. I think we all understand that. That's sort of common sense, as we say right now. Well, I should say, Senator Shelby already left. But I did want to respond about the funding of early--that per student funding has gone from $435 in 1975 to $1,159 in 2008, yet the United States has ranked some place down there in the ranking system. I don't know what the inflationary factor increase from 1970 to now would be. It's 40-some years. I suppose that would probably put it in equal terms maybe around $800. I don't know. And so then $300 in there. Look at the difference between 1970 and now. I mean, we weren't educating kids with disabilities then. They were all housed in institutions, and we were paying through the nose for that discriminatory action. So we've saved money there, but we put it into education, for educating kids with disabilities. So, yes, we might be spending more per student, but some of that money was being spent on institutional care for students or kids that just weren't being educated. From my area, I know a lot of kids went through 8th grade, 10th grade, dropped out of school and got a job in a factory. They could do that then. You can't do that anymore. And so we're educating more kids now, a lot more children than what we did in 1970. We've had an influx of English language learners into this country. We had the wave that came when my mother, who was an immigrant, came to the country. Then it subsided, and we had another big wave come. That has an effect on our schools and school spending also. So to say that we've increased spending on students a tremendous amount since 1970, it doesn't really tell me a lot until you factor in all those other factors as to what the student population is like right now. And to be sure, I wish the United States--and Secretary Arne Duncan said it--we've got to do a better job on educating kids. I politely disagree with my friend from the Cato Institute, who says the Federal Government has been the cause of all this terrible stuff. We only provide 8--between 8 and 10 percent of all the funding for elementary and secondary education in this country. And we're at a high point. It used to be less than that. I would assume if you go back to 1970, there's probably around 4, 5, or 6 percent of total funding for elementary and secondary education. Now, it's up to 8 or 9 percent. So if there's a fault, how about looking at the 92 percent that the States are funding? Ninety-two percent of all of the funding for elementary and secondary education come from States and local governments, not from the Federal Government. Is it the Federal Government's fault or is it the State and local government's fault that we rank so low on this? To blame it all on the Federal Government, when they provide 8 percent, is to ignore the elephant in a room, which is the State and local governments who provide 92 percent of the funding for education. You know, maybe they haven't done enough to bolster education in State and local governments. We had a hearing earlier this week on higher education, and there is a direct correlation between States that have decreased their funding for higher education and increased tuition. So if States have decreased their funding for higher education, tuition goes up, students borrow more money. That's why we have student debt today higher than credit card debt. So I say these things, I think about this. Is it really the Federal Government or is it State and local governments that bear the brunt of this? Well, again, I thank all of you. I think you've made us think about a lot of things. If nothing else, I think what we pointed out here, and I think maybe for different reasons voted against it, but I think we both agree that sequestration would be devastating, either on the defense side or the nondefense side. I just think that most of us have been focused on the defense side. I think now we're beginning to focus on what would happen in nondiscretionary defense spending if, in fact, we had sequestration. Again, an impetus for us to get them together, reach compromises as we've done, as I pointed out, we've done in the past. There's no reason why we can't do it now. ADDITIONAL COMMITTEE QUESTIONS So I thank you all for what you do in your local areas for education, and thank you for taking the time to be here and to testify and to give us the benefit of your thinking. [The following questions were not asked at the hearing but were submitted to the Department for response subsequent to the hearing:] Questions Submitted by Senator Tom Harkin are federal education programs effective? would sequestration harm federal education programs? Question. Mr. Secretary, during the hearing we heard testimony from Mr. Neal McCluskey who stated that ``. . . the last 40-plus years of Federal involvement in education provide a clear demonstration of futility'' and that education is a perfect example of why cuts can be made without adversely affecting the activities the Federal money is supposed to advance with ``. . . overwhelming evidence revealing that Federal spending has, at best, done no overall good, and has quite likely caused appreciable harm.'' Would you please comment on these opinions? Answer. I don't think we need to get into a debate about the effectiveness of the Federal role in education over the past four decades to demonstrate whether or not sequestration would have a negative impact on students, parents, teachers, and schools. The bottom line is that we know from our partners in State and local education agencies, from superintendents and school boards, and from parents and principals that our schools rely on Federal education programs to meet the educational needs of all students but especially students from low- income families, students with disabilities, English learners, and other students who face challenges in meeting State academic standards and graduating from high school college- and career-ready. We also know that millions of postsecondary students and their families, as well as the institutions of higher education that these students attend, depend on the Department of Education to process student financial aid applications and deliver the grant and loan assistance that students need to obtain a postsecondary education. There is simply no question that sequestration would have a severely adverse impact on these beneficiaries of strong Federal support for State and local education systems, particularly at a time when State and local budgets are still recovering from the recent economic recession. I would just add that we do pay attention to evidence of effectiveness regarding the Department's programs, and we have not been shy about proposing the elimination of programs that either are not effective or have limited impact. This is why, with the help of the Congress, we have eliminated or consolidated no fewer than 49 programs over the past 3 years, for a total savings of $1.2 billion. In my view, we have been very successful in cutting the ``fat'' from Federal education programs; sequestration would require us to cut into the bone and risk significant damage to students and schools across the Nation. impact on education programs of sequestration if pell grant program is exempt Question. In a September 2011 analysis of sequestration's impact, the Congressional Budget Office (CBO) estimated that nonexempt, nondefense discretionary programs will face an across-the-board cut of 7.8 percent in fiscal year 2013. At that time, it was unclear how the Pell grant program factored into CBO's analysis and whether the Office of Management and Budget (OMB) believed the program was subject to sequestration or if it was exempt. As you know, I released a report on July 25th entitled ``Under Threat: Sequestration's Impact on Nondefense Jobs and Services'', that provided a detailed, State-level analysis of sequestration's effect on dozens of education, health, and labor programs using CBO's 7.8-percent across-the-board cut estimate. I recently learned that OMB has ruled that the Pell grant program is exempt from sequestration. Given that the Pell grant program's discretionary costs represented 33 percent of the Department of Education's total discretionary budget in fiscal year 2012, I would like to know how OMB's recent decision affects the cuts that will need to be made to nondefense discretionary spending, particularly at the Department, to achieve the required savings under sequestration. Answer. Pell grants will be exempt from the fiscal year 2013 sequester. In its September report pursuant to the Sequestration Transparency Act of 2012, OMB took the Pell grant exemption and many other factors into account and estimated that the sequester for nondefense discretionary programs would be 8.2 percent. ______ Question Submitted by Senator Herb Kohl sequestration guidance for institutions of higher education Question. Over the past few weeks, we have heard more and more about how sequestration might affect our Research I universities and what it will mean for student financial aid and support programs. However, our smaller regional colleges and universities still have a lot of questions about what sequestration might mean for them. Does the Department of Education have any guidance for our smaller institutions of higher education? Answer. The administration continues to urge the Congress to pass a balanced package of deficit reduction that would replace the potential sequestration. As the September report on sequestration stated, ``. . . no amount of planning can mitigate the effect of these cuts.'' However, the exemption for Pell grants would make it easier for these smaller institutions than without the exemption. ______ Questions Submitted by Senator Mary L. Landrieu impacts on reform Question. I commend the administration on its strong commitment to education reform through initiatives like Race to the Top, Investing in Innovation (i3), the Charter Schools Program, and the Teacher Incentive Fund. Targeted investments in such evidence-based programs have leveraged significant education reforms in Louisiana and across the country. Mr. Secretary, can you please address how sequestration might alter the administration's education reform agenda and its impact on our Nation's efforts to close the achievement gap? Answer. Reducing investments in education is not the way to close the achievement gap or stimulate reform. The sequester would cut significant funding from our foundation formula programs, like title I and Individuals with Disabilities Education Act (IDEA), that provide resources for districts and schools serving our neediest students. It would be hard to avoid reductions in the number of teachers at a time when school enrollment is increasing. That would not be the formula for future success in turning around our economy or preparing more students to be ready for college or careers. I agree that our reform initiatives have been levers in producing reforms. I think we need to do more, not less, to stimulate reforms. Now more than ever, when we need to boost our economy by filling jobs with a future, we should be increasing our investments in approaches like Race to the Top. preparation for sequester Question. I appreciate that the Department has started communicating with Chief State School Officers about sequestration so that they can start preparing for the impending cuts. Since there is no guarantee the Congress will prevent sequestration, I hope that you will continue to communicate with our State education leaders regarding sequestration. Mr. Secretary, can you please discuss the next steps the Department will take to prepare for sequestration and to ensure that our States are prepared, as well? Answer. We are glad that the guidance on the major formula programs with advance funding (title I of Elementary and Secondary Education Act [ESEA], IDEA part B, Teacher Quality, and Career and Technical Education) was helpful to the States. We will continue to monitor progress in the Congress. As we have said before, the administration continues to urge the Congress to pass a balanced package of deficit reduction that would replace the potential sequestration. As the September report on sequestration stated, ``. . . no amount of planning can mitigate the effect of these cuts.'' We believe the reductions in spending would be significant and hope they can be avoided. preventing sequestration Question. Although this hearing is focused on the impact of sequestration on education, I think it's worth discussing efforts to prevent sequestration from happening in the first place. Mr. Secretary, how much outreach has the Department conducted on Capitol Hill to educate Members of Congress and their staff on the severity of circumstances surrounding these cuts, and will the Department increase its efforts as fiscal year 2013 approaches? Answer. The Sequestration Transparency Act of 2012 (Public Law 112- 155) required the President to submit to the Congress a report on the potential sequestration triggered by the failure of the Joint Select Committee on Deficit Reduction to propose, and the Congress to enact, a plan to reduce the deficit by $1.2 trillion as required by the Budget Control Act of 2011. In response, in September, the Office of Management and Budget issued a detailed report based on assumptions required by the STA. The report provided the Congress with a breakdown of exempt and nonexempt budget accounts, an estimate of the funding reductions that would be required across nonexempt accounts, an explanation of the calculations in the report, and additional information on the potential implementation of the sequestration. In addition to that report, the administration has also been actively discussing the repercussions in hearings like this one and in communications that provide as much information as possible at this point in the process. The President has proposed alternatives to the sequester on at least two occasions, and the administration believes that its balanced approach to deficit reduction is preferable to the arbitrary across-the-board reductions. ______ Questions Submitted by Senator Richard C. Shelby education program priorities if sequestration takes effect Question. Mr. Secretary, if the Congress is able to come up with a plan that would lessen the sequestration amount but still require additional discretionary spending reductions, where would you propose to take these cuts, and what are the priorities you want protected? Answer. I believe that education is an investment that is even more important in our tough economic times. I would not be reducing our education investments. Where it was possible, we have already made many reductions and achieved significant long-term savings. For example, we have already eliminated 49 programs in the past 3 years. Those programs didn't produce expected results, were duplicated by other programs, or had achieved their original purpose. Those eliminations save $1.2 billion each year. We also made changes in our student aid programs including $68 billion in savings by eliminating unnecessary subsidies to banks. We invested these savings in Pell grants and increased the maximum Pell grant award. And in order to ensure that the Pell grant program remains fully funded, we made hard choices to reduce student loan subsidies for graduate students and ended the year-round Pell. In addition, we kept the interest rate on subsidized Stafford loans for low-income students from doubling from 3.4 to 6.8 percent. actions taken to increase program efficiencies given potential sequestration Question. Within the Department, what steps have you taken to try and lessen the impact of sequestration on critical education programs, and, in particular, what are you doing to increase efficiencies knowing there could be an upcoming reduction in resources? Answer. No amount of planning will prepare for the arbitrary sequester. While we have issued guidance on how we will handle advance- funded appropriations, we have not been planning for significant reductions in our key programs. We are operating under the continuing resolution now, which assumes that funding for fiscal year 2013 will approximate the levels appropriated in fiscal year 2012. sequestration impact on unobligated balances, hold-harmless, and maintenance-of-effort provisions Question. The Department of Education has provided limited guidance to States about how the sequester will affect certain programs--in particular, how education programs that are advance-funded are impacted. However, it remains unclear how unobligated balances from fiscal year 2012 will be affected and how hold harmless and/or maintenance-of-effort (MOE) provisions will be impacted. Can you provide the subcommittee details on how these provisions will be affected? Answer. We do not believe that unobligated balances from fiscal year 2012 (i.e., funding that the Department has not obligated to States, school districts, or other recipients) will be affected by the fiscal year 2013 sequester. There would be no changes in hold-harmless and/or MOE provisions. Those are usually not dependent on the final level of appropriation for a given authority. option for new state and local flexibilities under sequestration? Question. Dr. June Atkinson, the State Superintendent for North Carolina, testified that the Department of Education should offer States and districts new flexibilities if sequestration is implemented. Does the Department have the authority to provide such flexibilities, and, if so, what specific flexibility, if any, is the Department considering providing to States and districts if sequestration is implemented? Answer. At this point, we do not see additional flexibilities arising from the sequester. The sequester will reduce the appropriations that are provided. The basic authorizing statutes will not be changed by the reduction in funding. sequestration impact on local education agencies with greater reliance on federal funding Question. It is estimated that the Federal contribution comprises on average only about 10.8 percent of a local school district's total funding. On the local level, this means that an automatic cut of 7.8 percent to the Federal share for an average school district would equal a cut of about .84 percent of its total funding. However, concerns have been raised that local school districts that rely on Federal funding for a larger portion of their budget, such as title I school districts, will have greater challenges implementing sequestration cuts. What actions could the Department of Education take to lessen the impact on school districts that rely heavily on Federal funding? Answer. The sequester would significantly reduce Federal funding. The cuts in formula programs that receive advance funding for next school year will have to consider reductions in staff and services. Those districts relying heavily on Federal funding will have to make the largest adjustments. We would try to share examples of cost-cutting efforts that would minimize the negative impact on students and teachers, but at this point, we are not engaging in such planning. sequestration impact on origination fees for student loans Question. Mr. Secretary, you discuss in your testimony the impact that budget sequestration would have on the ability to administer student aid programs. It is my understanding that under sequestration the Department of Education would also be required to increase the origination fees for Federal student loans which would increase borrowing costs for students. Can you discuss the changes that the Department expects to make to origination fees on student loans under sequestration? Answer. The Department is proud of its role overseeing the Federal student aid programs which assist nearly 15 million students annually to afford the cost of a college education. Part of this role includes offering low-interest student loans to students and families regardless of income, with favorable repayment and forgiveness options, and with low origination fees. Unfortunately, during a period of sequestration the Department would be required to raise existing origination fees for Direct Loans by the percentage specified in the sequestration order. All loan types--Stafford, unsubsidized Stafford, PLUS, and Consolidation loans--are subject to this increase. Currently, subsidized Stafford and unsubsidized Stafford loans have a 1-percent origination fee, and PLUS loans have a 4-percent origination fee. (Consolidation loans do not have such a fee.) The borrower is charged a calculated origination fee equal to a percentage of the principal amount of the loan. The fee is then subtracted from the principal amount before the loan funds are disbursed to the borrower. Thus, a borrower would see a smaller disbursement than a loan in the same amount before sequestration. ______ Questions Submitted by Senator Mark Kirk sequestration impact on local education agencies heavily dependent on impact aid funds Question. I understand that sequestration for the Impact Aid program will take effect on January 2, 2013, while sequestration for the majority of the other large elementary and secondary education programs will not go into effect until the 2013-2014 school year. I have a few questions regarding sequestration for Impact Aid. Will heavily impacted districts receive the blanket 7.8-percent cut you described in your testimony on January 2, 2012, or will the 7.8- percent cut be applied to the Impact Aid program as a whole, with the possibility that the heavily impacted districts may receive less of a cut, because these districts have no other options with which to make up the loss of local tax revenue? Answer. Most Federal support for the major K-12 education programs is appropriated on a ``forward-funded'' basis, so a sequestration for those programs would not have an impact until the 2013-2014 school year. In contrast, Impact Aid is a ``current-funded'' program. The Department obligates the great majority of the funding very soon after we receive an appropriation or during the period of a continuing resolution, and the program generally supports school district operations in the year of the appropriation. Because of this difference in timing, the January 2, 2013, effective date of a sequestration would affect the Impact Aid funding that eligible districts receive this school year. We do not yet know how a sequestration would take effect on a program-by-program basis and, thus, don't know whether the reduction would be the same for all programs within the Impact Aid account. I do note that heavily impacted school districts eligible under section 8003(b)(2) are funded from the same appropriation line item as school districts that receive regular Impact Aid payments under section 8003(b)(1). The authorizing statute requires that both types of payments be reduced in a similar manner when funds are insufficient to provide payments at 100 percent of the Learning Opportunity Threshold payment or 100 percent of full 8003(b)(2) funding. Therefore, in the event of sequestration, heavily impacted districts would receive the same cut to their Impact Aid payments as regular districts. departmental guidance to impact aid districts on planning for sequestration Question. How are you working with the specific Impact Aid districts so they can plan for reduction in Federal assistance? The State of Illinois has two communities that receive heavy-impact aid, and the funding from this program contributes significantly to their budget. Answer. In a series of webinars for Impact Aid grantees during early September, the Department provided a funding outlook for fiscal year 2013 to alert school districts to the possibility of reduced payments. The Department described multiple scenarios under a continuing resolution for part of the fiscal year, and shared basic information on the possibility of sequestration. The Department will be prepared to implement sequestration and provide guidance to grantees if necessary, but the administration remains confident that the Congress will pass legislation to avoid such drastic and untargeted cuts. CONCLUSION OF HEARING Senator Harkin. I will gavel to close unless somebody had something they wanted to offer. Going, going, thank you very much. The subcommittee will stand in recess. [Whereupon, at 11:54 a.m., Wednesday, July 25, the hearing was concluded, and the subcommittee was recessed, to reconvene subject to the call of the Chair.] -