I. Summary of the 2001 Budget

Under the leadership of President Clinton, the American people have made education one of their top priorities. Across the Nation, parents, teachers, principals, superintendents, State legislators, and Governors are committed to raising the educational achievement of all students. Over the past seven years, the Clinton Administration has worked with Congress to support their efforts through such new programs as Goals 2000, Educational Technology, Class Size Reduction, 21^st Century Community Learning Centers, GEAR UP, and Hope Scholarship tax credits. At the same time, the Federal investment in education has grown substantially: Department of Education discretionary spending rose from $23.0 billion in fiscal year 1996 to $35.6 billion in fiscal year 2000, an increase of $12.6 billion or 55 percent in just four years.

This investment has been coupled with a growing and unprecedented emphasis on accountability in our education system. Nearly all States have put in place their own challenging academic standards for students and are now implementing assessments linked to those standards. Many States and school districts are requiring students to pass achievement tests before graduating from high school, and educators are taking a hard look at ways to end the traditional practices of social promotion and retention in grade.

Now the focus is on the changes needed to ensure that all students are able to meet the new State standards. States and school districts must align curricula, textbooks, instructional methods, and professional development with the standards. Extended learning opportunities must be provided to students who are failing or at risk of failing to meet the standards. And the need for these changes and improvements comes as school systems already are struggling with booming enrollments and obsolete facilities. Nearly a half million additional students crowded into America?s schools last fall, for a record total of some 53 million?and new records will be set annually for the next several years. The public schools enrolling these new students average 42 years of age, with an estimated one-third needing extensive repair or replacement.

President Clinton?s fiscal year 2001 budget for education would provide significant new resources to help States and communities implement new standards in their schools while coping with booming enrollments and the need to modernize academic facilities. The request also provides substantial new support to help prepare disadvantaged students for postsecondary education and make college more affordable for all Americans.

The President is requesting $40.1 billion in discretionary appropriations for the Department of Education in fiscal year 2001, an increase of $4.5 billion or 12.6 percent over the 2000 level.

Major increases in the 2001 request include $1.3 billion for School Renovation, $716 million to raise the Pell Grant maximum award to $3,500, $547 million for after school enrichment activities under the 21^st Century Community Learning Centers program, $450 million to hire more teachers in the Class Size Reduction program, $416 million to bring new accountability and turn around low-performing schools in the Title I program, $333 million for Special Education programs to improve services for children with disabilities, $125 million to provide new pathways to college for disadvantaged students through the GEAR UP initiative, and $120 million for an expanded Small, Safe, and Successful High Schools program.

Total Department of Education Appropriations
(in billions of dollars)

Mandatory programs include Vocational Rehabilitation State Grants and the student loan programs. Mandatory costs fluctuate from year to year due to changes in interest rates and other factors affecting the costs of operating the student loan programs.

The Department?s 2001 request is complemented by significant non-discretionary investments in education, including the School Modernization Bonds proposal, the HOPE Scholarship and Lifetime Learning tax benefits, and the e-rate subsidies for educational technology. School Modernization Bonds, for example, would support nearly $25 billion in tax credit bonds to modernize up to 6,000 schools, while the e-rate provides nearly $2 billion annually to help schools and libraries connect to the Internet. For 2001, the Administration would build on the Lifetime Learning tax credit with a new College Opportunity Tax Cut proposal that, when fully phased in, would give up to 5 million families the option of taking a tax deduction or claiming a 28 percent tax credit on up to $10,000 in postsecondary education expenses.

The combination of discretionary and non-discretionary resources in the President?s budget is targeted to the following areas:

Accelerating Change

President Clinton shares the impatience of many parents with the pace of improvement at too many schools that are failing to improve student achievement, particularly in high-poverty urban and rural areas. We know the ingredients of effective education: high standards, well-qualified teachers, smaller classes, an emphasis on early reading, extended learning time, and instructional practices based on solid research. And expanded public school choice options can help ensure that no student is trapped in a failing school. To support these strategies, the 2001 request includes:

• $250 million for Title I Accountability Grants, an increase of $116 million, to accelerate efforts by States and school districts to improve accountability and turn around failing schools. In 1999, less than half of Title I schools identified for improvement due to low student achievement reported receiving additional professional development or other assistance. The request would help States and districts provide extra help to at least 80 percent of schools identified for improvement.
• $1.75 billion, a $450 million increase, for the third year of the Class Size Reduction initiative, which helps improve educational results by reducing class sizes with well-qualified teachers in the early grades. The 2001 request will bring the total number of teachers hired under the initiative's first three years to about 49,000, or nearly halfway toward the President's goal of hiring 100,000 teachers over seven years to reduce class sizes in the early grades to 18 students per class.
• $1 billion for 21^st Century Community Learning Centers, a $547 million or 121 percent increase, to provide more high-quality extended learning opportunities for children and to help ensure that every child attending a failing school will have the opportunity to participate in quality after-school or summer-school programs.
• $190 million for Comprehensive School Reform Demonstrations, a $20 million increase, to allow more schools serving high concentrations of poor children to implement comprehensive, research-based educational reforms.
• $120 million for a Small, Safe and Successful High Schools program to help create smaller and more supportive learning environments in approximately 700 of the Nation's largest high schools through such innovations as schools-within-schools or career academies that assign students to groups of a few hundred. This program would expand on the Smaller Learning Communities initiative that Congress created through the Department's 2000 Appropriations Act.
• $175 million for Charter Schools, an increase of $30 million, to support the start-up of some 1,700 new or redesigned schools that offer enhanced public school choice and have the flexibility to offer innovative educational programs in exchange for greater accountability for student achievement.
• $20 million for Opportunities to Improve our Nation's Schools (OPTIONS), a flexible new authority that would support 40 grants to States and school districts to implement and test new approaches to public school choice, including interdistrict programs and public schools at work sites and on college campuses.
• $198.6 million for Research, Development and Dissemination, an increase of $30 million, would double Department of Education support for two major interagency efforts aimed at building a knowledge base to improve student achievement in reading, mathematics, and science and schooling for language-minority students.
• $50 million for a new Recognition and Reward program to reward States for improving student achievement and for reducing the achievement gap between high- and low-performing students, as measured by State results in mathematics on the National Assessment of Educational Progress.

Improving Teacher Quality

Better-prepared teachers are the key to bringing the new State standards into the classroom. The Nation as a whole faces a shortage of an estimated 2 million teachers over the next 10 years, and high-poverty urban and rural districts already face great difficulty in recruiting and retaining qualified teachers. The 2001 budget would provide a total of $1 billion specifically targeted to improving teaching, including:

• $690 million for Teaching to High Standards State Grants, a new formula grants program (replacing Eisenhower Professional Development State Grants) to promote professional development and school and classroom-based improvements linked to State standards and assessments.
• $75 million for a new Hometown Teachers initiative to support comprehensive approaches to teacher recruitment and retention, including pipeline-style methods of addressing longstanding teacher shortages in high-need districts.
• $50 million for new Teacher Quality Incentives to reward districts showing the largest increases in the number of teachers certified and teaching in the fields in which they are trained.
• $50 million for a Higher Standards, Higher Pay proposal to help high-poverty school districts implement peer review systems to raise teacher standards while attracting and retaining high-quality teachers and principals through better pay.
• $25 million for Transition to Teaching: Troops to Teachers, which would expand a Department of Defense model to recruit teachers from the ranks of engineering and the sciences, corporations, and other career-changing professionals.
• $30 million for a new Early Childhood Educator Professional Development program to train 15,000 early childhood educators and caregivers in furthering children's language and literacy skills to help prevent later difficulties in learning to read.

Modernizing Our Schools

With the General Accounting Office estimating the total repair bill for the Nation?s aging schools at more than $100 billion, millions of our children are attending schools that are literally falling apart. Growing enrollments also create a need to build new schools, not just to renovate old ones. And the increasing role of technology in education requires upgraded electrical systems and extensive wiring at thousands of schools. To help meet these needs, the 2001 budget includes:

• $1.3 billion for a new School Renovation program would help local educational agencies (LEAs) repair or renovate their schools. The total includes $50 million in grants to approximately 119 LEAs with at least 50 percent of their children residing on Indian lands, $125 million in grants to other high-need local educational agencies, and $1.125 billion that would subsidize an estimated $6.5 billion in 7-year, no-interest loans.
• School Modernization Bonds would provide nearly $25 billion in tax credit bonds over two years to modernize up to 6,000 schools. Tax credit bonds would provide interest-free financing to help State and local governments pay for school construction and renovation.
• $450 million for the Technology Literacy Challenge Fund, a $25 million increase to help schools integrate technology into the curriculum and, in particular, to ensure that teachers in high-poverty communities are prepared to use educational technology effectively.
• Preparing Tomorrow?s Teachers to Use Technology would double to $150 million to support the development and implementation of teacher training programs that prepare prospective teachers to use technology to improve instructional practices and enhance student learning in the classroom.

Closing Achievement Gaps

Mastering the basics in the early years is the key to ensuring educational success and achievement later in life. Extra help is particularly important for students with special needs, such as economically disadvantaged students, children with disabilities, and limited English proficient students. The budget request includes significant resources to help States and school districts meet the needs of these students.

• $8.4 billion for Title I Grants to Local Educational Agencies, an increase of $416 million, with $250 million of the increase focused on efforts to hold schools accountable for results. The requested funds will give States and school districts additional resources to turn around failing schools, provide incentives for greater school success, and ensure that all students achieve to challenging State standards.
• $5.3 billion for Special Education Grants to States, an increase of $290 million, to provide additional resources to school districts that could be used to address problems found through Federal and State monitoring and to help districts meet State performance goals for children with disabilities.
• $650 million for Safe and Drug-Free Schools programs, an increase of $50 million to fund $40 million in new Safe Schools/Healthy Students grants and provide $10 million for Project SERV, which would assist communities affected by violence or other traumatic incidents.
• $286 million for Reading Literacy Grants, an increase of $26 million, to support local efforts to ensure that every child can read well and independently by the end of the 3rd grade.
• $296 million for Bilingual Education, an increase of $48 million or 19 percent, to support bilingual programs serving 1.3 million limited English proficient students, with an emphasis on assistance to school districts with little experience in serving such students. The request also includes a significant increase for efforts to reduce the continuing shortage of bilingual and English as a second language teachers.
• $116 million for Indian Education, a $38.5 million or 50 percent increase, to provide larger formula grants to school districts for Indian Education programs and launch a new $5 million American Indian Administrator Corps that would train American Indian teachers and professionals to become school administrators.

Reaching and Completing College

Despite the availability of record amounts of grant, loan, and work-study funding to help pay for postsecondary education, too many disadvantaged students do not believe that college is a real option. Many other students are not adequately prepared for the rigors of a college education and drop out after encountering difficulties. The 2001 budget includes significant funding for programs aimed at increasing college-going and completion rates among such students.

• A $125 million or 62.5 percent increase for GEAR UP would help raise the educational expectations of approximately 1.4 million low-income elementary and secondary school students and give them the skills and encouragement they need to enter and succeed in college.
• An $80 million increase for TRIO would support improvements designed to increase the effectiveness of TRIO college outreach and support services, while expanding the number of students served to more than 760,000 disadvantaged students. The request also includes $35 million for a new College Completion Challenge Grants program within TRIO that would help reduce the college drop-out rate, particularly among poor and minority students. This initiative would support comprehensive efforts to improve college retention and completion, including summer enrichment programs for first- and second-year students, support services, and increased grant aid.
• A new $40 million Dual Degree for Minority-Serving Institutions program would help students at Hispanic-Serving Institutions, Historically Black Colleges and Universities, Tribally Controlled Colleges and Universities, and Alaska Native- and Native Hawaiian-serving institutions to earn dual degrees in five years. Participants would earn one degree from their home institution and the other from a partner institution in a field in which minorities are underrepresented.

Making College Affordable

Postsecondary education is essential for success and career advancement in today?s information-intensive, technology-based economy. Yet college costs continue to rise faster than inflation, and many families struggle to pay postsecondary education expenses. The 2001 request would expand Federal support for paying college costs.

• Total student financial aid available through Department of Education programs would expand to $54.2 billion, a 5.5 percent increase over the 2000 level. The total number of recipients of grant, loan, and work-study assistance would grow by 217,000 to more than 8.6 million students.
• The Pell Grant maximum award would increase by $200 to $3,500, the highest ever, to improve access to postsecondary education for students from the neediest families. Nearly 3.9 million students would receive Pell grants.
• A new College Opportunities Tax Cut would build on the Lifetime Learning Tax Credit to provide up to 5 million families the option of taking a tax deduction or claiming a 28 percent tax credit on up to $5,000 in annual postsecondary education tuition and fees, with the limit rising to $10,000 in 2003. The Treasury Department estimates this proposal would provide a tax cut of some $30 billion over 10 years.
• A $60 million increase for Supplemental Educational Opportunity Grants would provide a total of $875 million in grant assistance to an estimated 1.2 million undergraduate students, or 64,000 more than in 2000.
• A $77 million increase for Work-Study would continue the President?s commitment to give 1 million students the opportunity to work their way through college and would bolster the President?s "America Reads" and "America Counts" initiatives, under which Work-Study recipients serve as reading and math tutors.
• A three-fold increase to $15 million for the Childcare Access Means Parents in School program would allow the Department to make 150 additional awards while maintaining support to 87 existing institutions. These awards would increase access to postsecondary education for low-income students who are parents.

Hispanic Education Action Plan

Latinos are the Nation?s fastest-growing minority population, and one whose educational achievement continues to require special attention. For the past two years, the Administration?s Hispanic Education Action Plan has targeted additional resources to improving educational outcomes, lowering dropout rates, increasing college enrollment and retention, and enhancing the lifelong learning potential of Latino students. The Department?s 2001 request continues this policy by providing more than $800 million in increases for the following programs.

• The $416 million increase for Title Grants to Local Educational Agencies will improve educational outcomes for the one-third of Title I students who are Hispanic.
• $100 million for Bilingual Education Professional Development, an increase of $28.5 million or nearly 40 percent, would address the continuing shortage of bilingual education and English as a second language teachers needed to serve limited English proficient (LEP) students.
• $180 million for Bilingual Education Instructional Services, an increase of $17.5 million that would help school districts build their capacity to operate high-quality instructional programs for LEP students. The increase would be targeted to districts with rapidly growing LEP populations and little prior experience in serving such students.
• $380 million for the Title I Migrant State Grant program, a $25 million or 7 percent increase, to meet the unique needs of the children of highly mobile migrant agricultural and fishery workers and bring about better coordination of the resources available for serving migrant students.
• $30 million for the High School Equivalency Program (HEP) and College Assistance Migrant Program (CAMP), an increase of $8 million or 36.4 percent, to support 20 new projects serving more than 2,600 additional students.
• $555.5 million for Adult Education, an increase of $85.5 million or 18 percent, most of which would be used to triple funding for Common Ground Partnership Grants, an English literacy and civics initiative launched in fiscal year 2000. These grants support demonstration programs that provide immigrants and other participants with English literacy skills, coupled with key skills that are necessary to effectively navigate life and work in America.
• $725 million for TRIO, an increase of $80 million or more than 12 percent, to expand and improve postsecondary outreach and student support programs for some 760,000 minority and disadvantaged students, including Hispanic Americans.
• $325 million for Gaining Early Awareness and Readiness for Undergraduate Programs (GEAR UP), an increase of $125 million or 63 percent, to give more than 600,000 additional students the skills and encouragement they need to prepare for and complete a postsecondary education. In 1999, GEAR UP funded 31 partnerships involving Hispanic- Serving Institutions.
• $62.5 million for Developing Hispanic-Serving Institutions, an increase of $20.3 million or 48 percent, to expand and enhance support to postsecondary education institutions that serve large percentages of Latino students. The program would make awards to 166 of the 195 existing HSIs, up from 120 in 2000.
• $10 million to continue an interagency research effort to improve learning for language-minority students. The Department is working with the National Institute for Child Health and Human Development to identify critical factors that influence the development of English-language literacy (reading and writing) competencies among children whose first language is Spanish.

Direct any questions to Martha Jacobs, Budget Service

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[Section A - Elementary and Secondary Education]