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About the Warner Amendment to the Senate ESEA Bill

July 10, 2015

ADDENDUM 07-11-15:

Regarding the Warner amendment:

1) It does not specifically name financial consultants, though it would allow them. In other words, the state could pay a nonprofit or even their own people employed in a different capacity as consultants;

2) the consultants themselves could already be hired and be paid using the state funding that must accompany ESEA dollars (that is, an ESEA amendment was not required to open the door for consultants to advise away any state or local ed funding, ESEA included– that door was already open), and

3) the ESEA funds that could be used to pay the consultants must come from the approx 1 to 5 percent of federal funds already allotted from each ESEA grant for administrative costs.

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On July 08, 2015, the Senate approved by voice vote an amendment to the Senate version of the reauthorization of the Elementary and Secondary Education Act (ESEA) of 1965, the Every Child Achieves Act of 2015. The amendment in question, Senate Amendment 2086, sponsored by Senator Mark Warner (D- VA), allows states to spend the administrative portion of ESEA funding grants on “fiscal support teams.” Though not explicitly stated in the amendment language, such support teams could include education businesses and consulting firms.

mark warner

Senator Mark Warner

In response to the above news, on July 09, 2015, investigative journalists David Sirota and Matthew Cunningham-Cook wrote an article in the International Business Times entitled, “Senate Passes Bill Letting Schools Give Education Money to Financial Consulting Firms.” The article implies that the Warner amendment has the potential to funnel ESEA grant funding to consultant bank accounts and away from needy children.

Not exactly.

Yes, the amendment grants consultants direct access to ESEA funds– but not to at least 95 percent of it.

For each of the grants in the ESEA document, limits are set regarding how much of the funding can be spent on administrative costs. These limits usually range from 1 to 5 percent. In the case of Warner’s SA 2086, the amendment refers to two sections from No Child Left Behind (NCLB), sections 9201 and 9203, both of which concern consolidation of administrative funds. According to these sections, states (and, under the supervision of states, the local education agencies) are allowed to consolidate the administrative allotments from various ESEA grants “if the State educational agency can demonstrate that the majority of its resources are derived from non-Federal sources.” (NCLB, pg 542).

So, yes, according to NCLB language to be retained as part of the Senate ESEA reauth bill, the state is able to spend ESEA funds on consulting firms; however, the states can only spend from the small percentage of ESEA funding allowed for administrative costs and only if the bulk of the state’s administrative funding comes from sources other than the ESEA money it receives.

Sure, it’s an opportunity for those consultants to make money, but not the unfettered opportunity for ESEA funding exploitation that it might appear to be upon first glance.

ADDENDUM 07-10-15:

Let me be clear that I do not approve of consultants being granted access to any ESEA money. What concerns me is that upon reading the Sirota-Cunninham-Cook article, the public could be misled into believing that as a result of Warner’s amendment, consultants have access to all ESEA funding. This is not true, and the public does not need to be made any twitchier over ESEA than it already is, and by inaccurate reporting.

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Schneider is a southern Louisiana native, career teacher, trained researcher, and author of the ed reform whistle blower, A Chronicle of Echoes: Who’s Who In the Implosion of American Public Education.

She also has a second book, Common Core Dilemma: Who Owns Our Schools?, newly published on June 12, 2015.

both books

 

 

 

From → legislation

11 Comments
  1. Dr. Rich Swier permalink

    Great. Posted: http://bit.ly/1TpEKP3

    Rich

  2. Thanks for both this clarification as well as all other information you’ve provided in regards to Congress’ attempt to update ESEA.

  3. I still see it as a foot in the door.

  4. Jill Reifschneider permalink

    Thank you for the clarification. I had read and posted the article that you referred to and appreciate the details you have provided.

  5. We were aware of the 5% limitation– sorry if anyone came out confused.

    I think that Ms Schneider is oversimplifying re: administrative funds. Administrative funds can include basics like cafeteria and bus service. In case you’re not aware, Sodexo and other cafeteria firms in fact offer grades of quality of food that they sell to clients. One of the results of this is that consultants may recommend to school districts that they buy lower quality food from their contractors–directly hurting kids in low-income school districts.

    Finally, it’s also important to acknowledge that this specifically empowers the types of financial consultants that got Denver and Chicago into its swap deals– and I don’t think it fosters a “twitchy” public or is “inaccurate reporting” to point out that giving those consultants access to ESEA funds could be counter to the public interest.

    • You “were aware” of the 5 percent without reporting this critical detail. That is the problem. Your article should have clearly outlayed the details of the amendment. By not doing so, you misled readers into assuming that the amendment gave access to 100 percent of ESEA funds. You can say that you believe I am oversimplifying, but I offer details that you neglected to provide.

  6. 2old2tch permalink

    Thank you for your clarification of what the amendment allows. I still don’t quite understand what the downside of not having this amendment is. What are states and local districts losing by not having this amendment? Financial consultants have a bit of a bad reputation in Chicagoland lately with the role they have played in the near financial collapse of Chicago.

  7. Unfortunately inaccurate reporting is par for the course in the so-called free media in the Untied States. The fact is that the US media is only allegedly free from government control but it is NOT free from the six CEO’s (and the six corporate boards) who control 90% of the traditional media in the US.

    CEO’s are not democratically elected. CEO’s are basically dictators hired and paid huge sums of money to make more money for those who own the most stock in those corporations. Offering honest, balanced and fair news is not high up on their list if cutting costs by firing too many reporters and lying/misleading the public means more money flowing in through advertisements.

    Who controls the otehr 10%?

  8. Ira shor permalink

    thanks for the clarification, very helpful. can I pls ask: how will this limit be policed and authenticated? our local district already violates state law limiting expenditures on consultants, refuses to stop even when called out publicly on it and evidence presented to town council. who will enforce these limits across 15,000 public school districts in the U.S.?

    • Good question, Ira. And as for ESEA, this is not the only place in the bill for private involvement.

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