Federal Aid to School Districts during the COVID-19 Recession. Working Paper 27550

National Bureau of Economic Research. 1050 Massachusetts Avenue, Cambridge, MA 02138-5398. Tel: 617-588-0343; Web site: http://www.nber.org

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COVID-19; Pandemics; Federal Aid; Elementary Secondary Education; Educational Finance; Resource Allocation; Special Education; Compensatory Education; Poverty; Public Schools; Expenditure per Student; Educational Legislation; Federal Legislation; Educational History; School Districts; Economic Climate

Coronavirus Aid Relief and Economic Security Act 2020; Elementary and Secondary Education Act Title I

The coronavirus has created an enormous--and expensive--challenge for elementary and secondary schools, while simultaneously depleting the revenue sources on which public schools depend. During the Great Recession, the federal government filled in a significant share of lost revenue. In contrast, the federal response to date has been limited. If Congress decides to invest in future generations, it faces a range of options for how to structure an aid package. One key aspect for any stabilization package is how federal funds should be allocated to states. We consider the types of approaches used in recent proposals, during the Great Recession, and at the onset of the COVID-19 crisis, as well as in major ongoing federal education programs for compensatory and special education. We simulate the distribution of funds and show the considerable difference in how per-child allocations correlate with child poverty rates under the most likely alternative approaches.

As Provided

2020

ED608521