Tuesday is the last day school districts have to spend down the last of a historic, one-time influx of federal funding targeted for COVID-19 response and recovery in K-12. It also marks the bookend to federal financial response to an unprecedented upheaval in education over the past five years that some education finance experts say will have long-lasting impacts.
The relief aid had several positive impacts with a potentially long runway, experts said. Among them: local financial decisions made in collaboration with communities and the consideration of innovative practices to increase student outcomes.
However, even half a decade after COVID emerged and nearly $190 billion in federal aid was disbursed, students in certain subgroups and grades are still struggling academically, on average. The chronic absenteeism rate is still high. And in some localities, the end of the Elementary and Secondary School Emergency Relief fund is causing financial shortfalls leading to program cuts and staff layoffs.
Marguerite Roza, director of Edunomics Lab at Georgetown University, said many of the financial strains that districts are experiencing now are related to the end of ESSER, but districts aren't spending much time reminiscing or reflecting.
"School districts seem to have moved on and are looking forward, spending not much time exploring what they learned from ESSER, what's worth saving, what didn't work," Roza said.
Tuesday is the last day school districts can spend down their American Rescue Plan allocations under ESSER. ARP, the last and largest of the three ESSER allocations, totaled $121.9 billion. According to the U.S. Department of Education, about 99% of that money has been spent.
Roza said one of the big lessons learned from the nearly five years of federal COVID relief is that some districts were able to quickly direct money and resources to priority areas, such as learning recovery. Other districts had less capacity to do so.
Another lesson was that state leadership matters, Roza said. Districts benefited from state guidance and supports for ESSER spending, she said.
While ESSER is in the rearview mirror for most school districts, some received permission from the Education Department to extend their spending deadlines an extra 14 months through March 30, 2026. As of Nov. 21, seven states and Puerto Rico got approvals to extend their spending deadline for a total of about $1.3 billion in ARP-ESSER allocations to school districts. Those states are Alabama, Delaware, Iowa, Kansas, Kentucky, Massachusetts and Nebraska.
Any unspent funds will need to be returned to the Education Department, but Roza said she predicts districts will spend nearly all of their ESSER allocations.
As school systems wean away from federal relief aid under ARP, state governments will feel more pressure from school communities for financial resources, Roza said.
"We are definitely turning the corner into the budget cutting time, and that is really as this ESSER money winds its way out of the system.”
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