NASET News Alert

States Returned More Than $66 Million in Unused Federal Education Funds to Treasury in 2004, Government Figures Show

May 26, 2006

WASHINGTON , D.C. – States collectively returned more than $66 million in unused federal education funds to the U.S. Treasury last year instead of spending it on students and schools, and they still have access to more than $6 billion in unused federal education funds dating back as far as the Clinton administration, official federal statistics show.  Much of the returned money could have been used to implement federal laws such as the No Child Left Behind Act (NCLB) and the Individuals with Disabilities Education Act (IDEA). 

The figures are among the highlights of an analysis of U.S. Department of Education data released today by the House Committee on Education & the Workforce Committee, chaired by Rep. John Boehner (R-OH).

“As President Bush releases his budget proposal for the upcoming fiscal year, it’s only appropriate that we look back at how the money Congress has already appropriated has been used – or not used – over the past five years,” said Boehner, who noted K-12 education funding will have increased by 51% since 2001 if the President’s FY 2006 Budget is enacted.

Among the findings released this month:

States collectively returned more than $66 million in unused federal education funds to the U.S. Treasury in 2004.  Non-competitive “Formula” funds for initiatives such as Title I aid to disadvantaged students and IDEA accounted for approximately $42,199,680 of the returned funds.  “Discretionary” funds awarded to states, local school districts and schools on a competitive basis accounted for $24,049,951. 

As of January 7, 2005, states collectively had access to more than $6 billion in unexpended federal education funds appropriated for their use in FYs 2000, 2001, 2002 and 2003.  States had more than $325 million in unexpended funds originally appropriated under President Clinton (FYs 2000, 2001). 

The total amount of federal education money unused by states is increasing, not decreasing.  As of January 6, 2004, states had approximately $5.75 billion in unused federal education funds.  As of last month, the total was $6.05 billion – an increase of more than $295 million.

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