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Friday, June 16, 2000

Hawaii State Seal

Education Dept.
can keep, spend
federal millions

The governor allows $12.4 million
in extra educational aid to be
spent on schools' needs

By Crystal Kua


The Department of Education is being allowed to keep and spend an additional $12.4 million in federal aid, money that has not gone to Hawaii's public schools in the past.

"This is an unprecedented action taken," Board of Education Chairman Mitsugi Nakashima said.

The additional money will be used to pay for a laundry list of items, including offsetting a $1.5 million deficit in the school bus transportation program and complying with a federal court order to improve mental health and educational services to special-needs students.

The department this year estimated that it would receive $19 million in impact aid from the federal government, but the actual amount it will receive will likely be about $31.4 million, which means an extra $12.4 million in aid for Hawaii.


The state Department of Education estimated it would receive $19 million in federal impact aid this year, but will actually get $31.4 million. Here is how the department intends to spend the extra $12.4 million:

Bullet Instructional materials: $2 million

Bullet Reading improvement project: $2 million

Bullet Court-ordered special-needs compliance: $3.6 million

Bullet Autism services: $276,690

Bullet Office of Hawaiian Studies/Language/ Culture: $500,000

Bullet Computer education: $200,000

Bullet Safety managers: $600,000

Bullet Student transportation: $1.5 million

Bullet Impact aid contingency: $1 million

Bullet Costs previously paid by other departments: $169,069

Bullet Litigation settlements: $250,000

Bullet Master of Education in Teaching Program: $290,000

Impact aid compensates school districts for educating federally connected students such as military children.

"The federal government releases impact aid pretty sporadically," state schools Superintendent Paul LeMahieu said. "It's literally impossible to predict how much a given year's receipt will amount to. We make an estimate of how much we think is coming in."

LeMahieu told the Board of Education yesterday that Gov. Ben Cayetano earlier this month approved a request by the department to spend the additional aid on public school programs, a change in the fiscal policies of the past.

"Historically ... if (impact aid) comes in over the (estimated) amount, the state has kept it," LeMahieu said.

"If it comes in under the amount, meaning there's a shortfall in the amount, we've had to eat it."

Each time the amount received is above the amount allocated, the department has had to seek the governor's permission to spend the money.

"Historically, while the economy has been bad, the governor has had to hold on to that money to help with the balancing of the state budget, and that money never ended up in education," LeMahieu said.

But due in part to a rosier economic outlook, things changed this year. "He gave us permission to go ahead and spend that money," LeMahieu said.

LeMahieu said the situation with impact aid will change again next year because of new legislation that the governor will sign on Monday along several education bills -- including one on educational accountability.

"The law of the state will say, 'Thou shall not restrict impact aid monies to the school system.' It will go directly to the school system," LeMahieu said.

The department is planning to spend the money on items with a one-time cost, addressing court mandates and anticipated shortfalls.

One of those includes a $1.5 million shortfall that will follow the school bus transportation program when it is transferred to the Department of Education on July 1.

Although impact aid money will be used to offset that shortfall next year, the department has not ruled out making changes in bus transportation to make it more cost-effective, LeMahieu said.

LeMahieu said there are other shortfalls that cannot be paid by impact aid, including negotiated salary raises that the department has not received enough funds in its budget to cover.

But LeMahieu said there will not be a deficit at the end of the fiscal year (June 30) because the department plans to continue internal restrictions and look for other funding sources to prevent the budget from going into the red.

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