Federal stimulus money averted a greater budget crisis for public education during the economic downturn and saved teaching jobs, according to a report released Tuesday by George Washington University's Center on Education Policy (CEP), but the funding's expiration and accompanying state and local budget troubles have stymied the implementation of reforms tied to it.

The American Recovery and Reinvestment Act (ARRA) included $48.5 billion for a State Fiscal Stabilization Fund, distributed by the Obama administration, intended to offset state and local education cuts that resulted from plummeting tax revenue during the recession. The Education Jobs Act, added a year after ARRA first passed in 2009, provided another $10 billion targeted toward preventing teacher layoffs.

According to the Center's review of ARRA spending from 2009 to 2012 and surveys of education officals, 97 percent of school districts said stimulus funding compensated for at least some of their funding cuts from state and local sources during the 2009-2010 school year, after the onset of the economic downturn.

In 2010, according to CEP, nearly 70 percent of school districts said they used stimulus money to save or create jobs for teachers and other school staff. In 2011, 31 of 35 states surveyed said that they used the Stabilization and Education Jobs funding to save instructional staff positions. CEP concluded that the ARRA money therefore prevented a further crisis and pointed to one number to explain why: even with additional federal funding, 85 percent of school districts reported in 2010-2011 that they had laid teachers and other staff off to close remaining budget gaps.

Official figures back both assertions: The White House estimated in October 2011 that stimulus funding streams had supported 422,000 teaching jobs, but that nearly 300,000 teachers had still been let go since 2008.

“Federal stimulus funds appear to have blunted the effects of the economic downturn on the K-12 education sector,” Maria Ferguson, CEP’s executive director, said in a statement. “Although many districts still had to eliminate teaching and other key staff positions, our research indicates that the situation would have been worse without the stimulus funds."

School districts seemed to agree: between 83 and 89 percent said they were better off because of the infusion of ARRA funding.

The receipt of stimulus money required states and school districts to commit to certain reforms: adopting college-and-career-ready standards, expanding the use of education data and developing plans to improve struggling schools, to name a few. According to CEP, 20 states said that the ARRA funding initially increased their pace toward reform and 18 states said it broadened the scope of their reform initiatives.

But the loss of stimulus money (it expired about a year ago), coupled with a meager recovery for state and local funding, means those reform efforts are slowing down. Nearly 70 percent of school districts said they had slowed or postponed their reforms in 2011 because of dwindling funding. CEP concluded that few states had fully implemented the reforms laid out in ARRA by fall 2011.

"Parents and students may not see the full benefits of these reforms until local economic conditions improve,” Alexandra Usher, CEP’s senior research assistant, said in a statement.

The full CEP report is below.

  CEP on Stimulus Impact on Education (PDF)
CEP on Stimulus Impact on Education (Text)