Texas schools are eligible to receive about $12.4 billion of the $130 billion earmarked for education under the $1.9 trillion American Rescue Plan passed this week by Congress and signed by President Biden March 11.

The legislation also will distribute stimulus checks up to $1,400 to millions of Americans and another $350 billion to cities and states that experienced declines in tax revenue and increases in expenses. The bill also funds an additional $300 in unemployment payments per week until early September and extends the child income tax credit. 

While it will take time to thoroughly review and understand all the implications of this massive stimulus bill, an early summary from the Congressional Research Service says 90% of funds sent to the state, or $11.2 billion, must be given to local districts by TEA based on their share of Title I-A grants in the Elementary and Secondary Education Act. Of the remaining funds, the state must use at least 5% to address learning loss, 1% for summer enrichment activities and 1% for after-school programs.

The funds would remain available through Sept. 30, 2023. Section 421 of the General Education Provisions Act (GEPA), commonly referred to as the “Tydings amendment” provides that any funds appropriated for an applicable program that are not obligated and expended by the recipient educational agencies and institutions before the end of the fiscal year shall remain available for obligation and expenditure for one additional fiscal year (e.g., through Sept. 30, 2024, in this case).

Table 1. Appropriations for Programs Included in the Education Stabilization Fund As Would Be Provided by the Senate Substitute to H.R. 1319 (Dollars in thousands)

Program Funds (dollars in thousands)
Appropriation Elementary and Secondary School Emergency Relief Fund       $122,774,800
Reservation of funds by the Secretary of Education for homeless children and youth $800,000
Emergency Assistance to Non-Public Schools   $2,750,000
Higher Education Emergency Relief Fund $39,584,570
Total appropriation $165,109,370

Source: Congressional Research Service analysis of provisions in the Senate amendment to H.R. 1319 passed by the Senate and prepared pursuant to the reconciliation directives included in S.Con. Res. 5. 

Elementary and Secondary School Emergency Relief Fund

From the total appropriated for the ESSER Fund, the Secretary of Education (hereinafter referred to as the Secretary) would be required to reserve $800 million to identify homeless children and youth and provide homeless children and youth with wrap-around services and assistance needed to attend school and fully participate in school activities.

After making this reservation of funds, the remaining $121,974,800,000 would be used to award ESSER Fund grants to state educational agencies (SEAs) based on their relative shares of grants awarded under Title I-A of the Elementary and Secondary Education Act (ESEA), as amended, for the most recent fiscal year (FY2020). The ESEA requires that Title I-A grant amounts used to determine other formula grants to states be calculated with no hold harmless provisions applied. Thus, CRS calculated estimated ESSER Fund state grants for purposes of this memorandum using FY2020 Title I-A grants with no hold harmless provisions applied.

Under the Senate substitute, each SEA would be required to use at least 90% of the funds awarded to make subgrants to LEAs in proportion to each LEA’s share of actual Title I-A grants made to all LEAs in the state during the most recent fiscal year (FY2020). LEAs would be required to use at least 20% of the funds they receive to address learning loss. Each SEA also would be required to reserve funds at the state level for several purposes.

SEAs would be required to reserve at least 5% of the total grant award for activities to address learning loss. SEAs also would be required to reserve at least 1% of the total grant award for evidence-based summer enrichment program and at least 1% for “evidence-based comprehensive” afterschool programs. Each SEA would be permitted to reserve up to 0.5% of its total grant award for administration.

Any remaining funds could be used by the SEA for other state activities as determined by the SEA to “address issues responding to coronavirus.”

For more information about funding allocation for schools in the bill, click here.