August 10, 2010: President Obama signed into law the $26 billion state education aid bill.
The legislation provides $10 billion to state school districts, to rehire and save 300,000 state employee jobs, more than half of them (160,000) teaching jobs.
The remaining $16 billion will help states pay their share of Medicaid, public health for the very poor. State budgets have been decimated during this recession as Medicaid costs have soared.
Analysts say the latest cash infusion is essential to preserving the fragile economic recovery. The last thing our current economy needs is more people out of work.
States are experiencing the largest revenue drop that they’ve ever faced. This rescue package contains funds that must be spent rehiring teachers and sustaining state payrolls.
This funding is fully paid for from closing a business tax loophole and will not add to the federal deficit. As reported by the nonpartisan Congressional Budget Office, it will actually lower the deficit over the next 10 years.
The Senate approved this critical funding by a vote of 61-39 on August 5, 2010, with only two Republicans (Senators Olympia Snowe and Susan Collins, both of Maine) breaking with party orders to vote in favor of saving teacher jobs.
Considering the impending school year start, Nancy Pelosi,(D-CA) Speaker of the House of Representatives, called House members back from their August recess to vote on the measures approved by the Senate. The bill passed 247-161 on August 10, 2010, with only two Republicans (Michel Castle (R-DE) and Anh Cao (R-LA)) in favor of saving teacher jobs.
The fast track passing of this bill will allow the U.S. Department of Education to begin distributing this funding to the states’ governors by September using a formula based on population.
A chart was created by The Center for Budget Policy and Priority showing the funding each state is expected to receive for both education stabilization and Federal Medical Assistance Percentage (FMAP) for Medicaid.
Republicans are not happy about the federal funding. Some governors are reluctant to accept the money because federal conditions stipulate using the funding for education only and they want the money for other programs.
Wisconsin Democratic Governor Jim Doyle, welcomed the stimulus money to his state to handle the urgent needs states and residents have right now. “We cannot ask a second-grader to come back and complete their studies five years from now when the economy has turned around,” … “The education we provide now will be the strength of our state and nation for decades to come.”
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