Elementary and Secondary Education: Flexibility Initiatives Do Not
Address Districts' Key Concerns About Federal Requirements
(Statement/Record, 01/25/2000, GAO/T-HEHS-00-51).

Deteriorating school buildings, poor results on international
comparisons of student achievement, and the accelerating pace of
technological growth have focused attention on America's students and
schools. In the past, the response to such issues has often been to
increase federal and state involvement--often through new programs or
additional requirements in existing programs. Some educators and
analysts have expressed increasing dissatisfaction with this approach,
however, arguing instead that existing federal requirements should be
lifted or eased. Others are hesitant to adopt this strategy because of
concerns that important objectives, such as financial accountability,
may be sacrificed. This report focuses on (1) the major federal
requirements that affect school districts, (2) the issues that school
districts face in implementing these requirements, and (3) recent
initiatives by Congress and the Department of Education to provide
flexibility to school districts.

--------------------------- Indexing Terms -----------------------------

 REPORTNUM:  T-HEHS-00-51
     TITLE:  Elementary and Secondary Education: Flexibility
	     Initiatives Do Not Address Districts' Key Concerns About
	     Federal Requirements
      DATE:  01/25/2000
   SUBJECT:  State-administered programs
	     School districts
	     Elementary education
	     Aid for education
	     School management and organization
	     Secondary education
	     Funds management
	     Federal regulations
	     Compensatory education
	     Waivers
IDENTIFIER:  HHS Individuals With Disabilities Education Act Program
	     National School Lunch Program
	     Dept. of Education Bilingual Education Program
	     Individualized Education Program
	     Massachusetts
	     Pennsylvania
	     Louisiana

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GAO/T-HEHS-00-51

ELEMENTARY AND SECONDARY EDUCATION

Flexibility Initiatives Do Not Address Districts' Key Concerns About Federal
Requirements

        Statement of Cynthia M. Fagnoni, Director

Education, Workforce, and Income Security Issues

Health, Education, and Human Services Division

Testimony

Before the Committee on Education and the Workforce, House of
Representatives

United States General Accounting Office

GAO

Elementary and Secondary Education: Flexibility Initiatives Do Not Address
Districts' Key Concerns About Federal Requirements

Mr. Chairman and Members of the Committee:PRIVATE

I am pleased to have the opportunity to summarize our report on how federal
requirements affect local school districts. This study focused on three
major issues that I will discuss today: (1) the major federal requirements
that affect school districts; (2) the issues school districts face in
implementing these requirements; and (3) recent initiatives by the Congress
and the Department of Education to provide flexibility to school districts.

Deteriorating school buildings across the country, unfavorable results on
international comparisons of student achievement, and the accelerating pace
of technology growth have heightened our national interest in the success of
America's students and schools. In the past, concerns like these have often
been met with increased federal and state involvement and funding, leading
to new programs or additional requirements within existing programs. Some
educators and analysts have been voicing increasing dissatisfaction with
this way of addressing schools' problems. Instead, they have suggested
taking the opposite approach and lifting or easing existing federal
requirements. Others are hesitant to adopt this strategy, however, because
they are concerned that important objectives such as financial
accountability may be sacrificed.

To obtain information on the impact of federal requirements, we interviewed
officials from 87 school districts, located primarily in 3
states-Massachusetts, Pennsylvania, and Louisiana. We also interviewed
representatives from federal and state agencies and from 15 major education
associations. In addition, we analyzed federal laws, regulations, and
program guidance, as well as district and state documents and data from the
Department of Education. Our study focused on the 36 major federal programs
and mandates that school district staff, education experts, and the
literature identified as having a major impact. These requirements include
not only major education programs, but also other areas such as food service
and environmental requirements.

In summary, school districts are subject to a large number and a wide
variety of federal requirements that reflect a variety of purposes and
goals-such as ensuring students' health and safety, helping students that
have particular disadvantages, and improving educational quality in key
subject areas. Although some individuals may believe that federal
requirements are not accompanied by federal funds, the majority of the
programs and legislative mandates we identified carried some federal
dollars. This federal funding is often distributed to school districts
through the states, which frequently place additional requirements on
districts' administration of federal programs.

Both federal and state requirements can create implementation issues that
affect how school districts plan, fund, and operate their educational
programs. Just obtaining sufficient information about federal requirements
can be a challenging task for district administrators, making some districts
reluctant to change long-established practices in favor of new educational
initiatives. District officials expressed concern about the limited federal
financial support in meeting federal requirements, despite their general
agreement with the underlying goals. School district officials also told us
that certain federal requirements create logistical and management
challenges in operating their educational programs.

The multiplicity and complexity of these implementation issues make them
difficult to address, especially because it is frequently those requirements
that are often viewed as very beneficial-such as environmental
protection-that give rise to many implementation concerns. District staff
reported receiving little assistance from recent federal initiatives that
have attempted to provide more flexibility. For example, although the
Department of Education can grant waivers (temporary exemptions from certain
federal regulations), waivers are not available for many key requirements
such as those of the Individuals with Disabilities Education Act (IDEA).
Similarly, Congress passed legislation that allows districts (with the
state's permission) to shift a portion of their funds across certain federal
programs. However, many states do not allow districts to use this provision,
and the amount of funding that can be covered is generally very small. As
currently structured, federal flexibility mechanisms are not well-positioned
to address the concerns identified by the districts we interviewed; however,
any new initiatives would also have to balance the interests of school
districts and the larger purposes reflected in many pieces of federal
legislation.

School Districts Subject To Federal Requirements

In A Variety Of Areas

The major federal requirements facing school districts reflect a wide range
of program objectives and policy goals; are often accompanied by some
financial assistance; and are compounded by the addition of state and local
requirements.

Federal Requirements Have a Variety of Purposes and Goals

In each of these roles, school districts are subject to federal requirements
designed to accomplish various public policy goals. As educators, for
example, districts are required to provide a free, appropriate public
education to students with disabilities and to follow federal requirements
in accounting for federal funds they receive. As food service providers,
school districts that choose to participate in federally-funded school lunch
and breakfast programs receive cash and commodity support; in return, they
must provide free and reduced-price meals to needy children and serve meals
that meet federal nutrition standards. As managers of public facilities,
districts must abide by federal environmental requirements and must ensure
that new buildings (and some existing ones) comply with requirements to
ensure accessibility for persons with disabilities. The large number of
federal education programs, combined with federal labor laws, environmental
requirements, and other mandates, creates a body of requirements that affect
school districts. These federal requirements are directed at a wide range of
fiscal concerns, policy goals, and program objectives-such as ensuring
students' safety and health, providing equal educational opportunity, and
improving educational quality in areas of economic importance. Table 1 shows
several federal objectives and examples of programs, mandates, and
requirements that are designed to achieve these goals.

Table 1: Programs and Mandates Designed to Achieve Variety of Federal
Objectives

 PRIVATE Objective               Example of Program or Requirement
                                 To guard against exposure to harmful
                                 asbestos fibers, the Asbestos Hazard
                                 Emergency Response Act (AHERA) requires
 Ensure safety and health        school districts to inspect schools for
                                 asbestos and to draw up an asbestos
                                 management plan that identifies where
                                 asbestos is located in the schools.
                                 To protect groundwater from contamination,
                                 EPA requires owners (including school
                                 districts) of certain underground storage
                                 tanks (USTs) to upgrade the tanks to meet
                                 new standards for spill protection and
                                 corrosion.
                                 Title I of the Elementary and Secondary
 Ensuring equal educational      Education Act established a program that
 opportunity                     gives districts funds to help students at
                                 risk.
                                 The Stewart B. McKinney Homeless
                                 Assistance Act provides funding to help
                                 states and districts educate homeless
                                 children
                                 The Individuals with Disabilities
 Protect and promote civil       Education Act (IDEA) establishes the right
 rights                          of students with disabilities to receive a
                                 free appropriate public education.

 Improve educational areas with  The Technology for Education program
 special importance              provides money for technology upgrades in
                                 schools.
                                 Federal programs such as Title I include
 Ensure the fiscal integrity of  financial accountability measures that
 federal funds                   restrict how districts spend federal funds
                                 and limit the amount school districts can
                                 carry over from one year to the next.
                                 The Tax Reform Act of 1986 limited school
                                 districts' ability to earn higher rates of
                                 interest on the proceeds of the bonds they
                                 issue under their tax-exempt status.

Federal Funding Accompanies Many of the Major Federal Requirements

Although some individuals believe that federal requirements are not
accompanied by federal dollars, the majority of the major federal programs
or legislative mandates we identified carried some federal funding. For
example, in fiscal year 2000 the Bilingual Education program will provide
about $248 million to help school districts carry out their obligation to
ensure that students with limited English proficiency have meaningful access
to education, and in fiscal year 2000 programs under the Individuals with
Disabilities Education Act (IDEA) will provide about $5.8 billion to help
states and districts ensure that students with disabilities receive a free
and appropriate public education. Although detailed information on the costs
associated with complying with federal mandates or implementing federal
programs is often unavailable, it is clear that for several major programs,
federal financial contributions do not fully fund the activities these
programs support. For example, the Department of Education has estimated
that for the 1993-94 school year, in 24 states about $13.9 billion was spent
to provide services to children with disabilities under IDEA, yet only 7
percent of these costs were supported by federal funds. On the other hand, a
few programs are fully- or nearly fully-funded-for example, in school year
1992-93 the federal subsidy for a free lunch under the National School Lunch
Program was approximately equal to the median cost of producing a school
lunch.

School Districts Are Also Subject to State and Local Requirements and
Judicial Decisions

Implementation Issues Relating To Federal Requirements Affect How School
Districts Plan, Fund And Operate Educational Programs

Information on Federal Requirements Is Essential for Financial and Program
Planning

Despite this compelling need, education experts, school district
representatives, and state officials agreed that districts often have
incomplete information about federal requirements and the flexibility
available in implementing these requirements. For example, accessibility
experts have observed that local officials sometimes misunderstand the
accessibility requirements, and that some accessibility expenditures by
local schools may not be required under federal law. Similarly, the
Superintendent in one district we visited responded to our question about
federal waivers by saying "I just never thought it was possible."

School District Staff Cite Limited Funds

to Implement Certain Federal Requirements

   * Special education, which can require districts to provide specialized
   * educational and related services such as smaller class sizes,
     individualized programs and assistive technology;
   * Asbestos abatement or removal when renovating or repairing school
     buildings;
   * Accessibility-that is, adding features such as ramps, elevators and
     accessible bathrooms to remodeled or existing buildings;
   * Underground Storage Tanks (USTs)-that is, upgrading certain USTs to
     meet EPA requirements for spill protection and corrosion prevention;
   * Nutrition Standards for School Meals-although USDA analysts have
     reported that the new requirements can be met without increasing the
     cost of the meal, several food service directors we interviewed
     disagreed, citing higher prices for low-fat alternatives such as 1
     percent milk.

Many school district officials also told us that the administrative
processes necessary to implement federal programs can be resource-intensive.
For example, food service directors told us that distributing, collecting,
and processing applications for free and reduced-price lunches demands a lot
of resources for the first few months of each school year, which is the
busiest time for all school staff. To ensure that only eligible children
receive benefits, districts must obtain (and for a sample of cases, verify)
family income information. In the districts we visited, the food service
staff used several strategies (such as obtaining data on food stamp
households) to try and limit the amount of work created by lunch
applications, but some districts still had to hire additional workers to
make sure that disadvantaged children could promptly begin receiving free
breakfast and/or lunch.

To a lesser extent, accounting, reporting and financial requirements also
occupy districts' administrative resources. Staff from 25 percent of the
districts we interviewed by telephone identified certain accounting and
reporting requirements as problematic, as did staff at two of the districts
we visited. In our site visits, we found that many of the specific
requirements district staff told us about were state, not federal,
requirements. For example, federal regulations generally allow for equipment
purchases up to $5,000 without additional documentation, but one state we
visited imposed a more stringent threshold of $500, increasing districts'
paperwork requirements. Some district representatives also expressed
dissatisfaction about requirements that place restrictions on how they raise
and use funds. For example, several managers we interviewed criticized
provisions of the 1986 Tax Reform Act that are designed to prevent state and
local governments from using funds from the sale of tax exempt bonds to
acquire higher yielding investments. However, not all district managers felt
this way. One Business Manager in a small district, for example, told us
that he supports these types of requirements because they are necessary to
prevent fraud and abuse.

Certain Federal Requirements Can

Create Logistical and Management Challenges for School Districts

Some school districts are also facing shortages of qualified personnel to
provide federally-mandated services. For example, in a Department of
Education study of services to students with limited English proficiency,
over half of school districts reported having difficulty hiring bilingual or
English as a Second Language teachers. In one state, staff in several
districts told us that they had a hard time finding not only certified
special education teachers, but also providers of certain related services
such as physical therapy and speech pathology. Similarly, the facilities
manager in one rural school district told us that there were very few
accredited asbestos contractors in the area, and he believes that they can
charge very high prices because of the lack of competition.

Recent Flexibility Initiatives Are Not Structured To Address School
Districts' Major Concerns

These initiatives are generally not structured to address the information,
funding, and management issues that school districts identified as their
primary concerns. First, rather than simplifying the necessary information
on federal requirements, these flexibility initiatives actually expand the
amount of information school district officials need. To take advantage of
these provisions, district staff must know that they exist and learn how to
use them. Because these initiatives are program-specific, and each applies
to a different set of programs, district officials need detailed information
on each provision-information that is often difficult to find.

Second, flexibility initiatives do not address school districts' funding
concerns. By design, these initiatives cannot increase the flow of funds to
school districts nor can they relieve districts of their major financial
obligations. The areas covered by the flexibility initiatives are not those
that school districts cited as especially costly-special education,
environmental, and building accessibility requirements. Similarly, the
flexibility initiatives can have only a limited impact on school districts'
administrative costs because they do not cover several key program areas
such as food service and special education. However, waivers and
consolidated planning can help some districts streamline processes in other
administrative areas, including the process of applying for federal funds.

Third, the limited coverage of flexibility initiatives also precludes them
from addressing several of the logistical and management concerns that
school districts identified as key issues, such as meeting timelines for
evaluating special education students and finding qualified personnel (such
as bilingual teachers or environmental contractors) to implement key federal
programs. For example, because the flexibility initiatives do not extend to
special education requirements, districts cannot use these provisions to
address their concern with timelines.

In conclusion, the findings of this study suggest 4 major lessons to be
considered in refining existing federal flexibility initiatives and
designing new ones. First, because school districts' key concerns are
wide-ranging, rather than centered on a single program or issue, federal
flexibility initiatives must be multifaceted and reach across federal
programs to successfully address districts' needs. Second, adequate
information is crucial to districts' efforts to successfully implement
federal programs and take advantage of flexibility efforts. Third, because
states play a major role in overseeing and administering federal programs,
state education agencies must be able and willing to help school districts
implement flexibility initiatives if these efforts are to succeed. Finally,
Congress and the Department of Education face potential conflicts between
local officials' desire for flexibility and the important purposes
underlying federal programs and mandates. Broadening the scope of federal
flexibility efforts raises concerns about whether the underlying goals of
federal programs can be achieved without the guidance of specific regulatory
provisions.
(104992)
*** End of document ***