Improving Programs Through the Smart Use of Data Data management reform will significantly reduce the local, state, and federal paperwork swamping this employee. As a companion to the President's elementary and secondary education reforms, the budget includes a fundamental reform of how the Department of Education and states cooperate to collect and analyze data on school performance. For the federal government and states to hold schools accountable for educational results, they must measure student progress yearly. The federal government's old approach of issuing and collecting voluminous reports that had little utility for decision-makers or the public will be replaced by a new system that uses the latest technology to make performance information readily available to federal, state, and local decision-makers and the public. The new Performance-Based Data Management Initiative will involve: 1) electronic collection of timely data on student achievement and educational outcomes; 2) elimination of existing reporting burden that diverts state and local school resources from their educational mission; and 3) analysis of data on educational results to identify performance trends and inform management, budget, and policy decisions. The budget includes $10 million to develop, in collaboration with states, the electronic data system. An Expert's Report on Reports "The bottom line is...I don't think it's really used," said a state employee about a "massive" survey distributed by the Department of Education on elementary and secondary education programs. "Every state reports the information differently," added the employee, who also explained that 14 full-time professional staff and two temps worked for three weeks to complete the form. "Our response [to the US Department of Education] is an inch-and-a-half thick," the civil servant stressed, concluding that despite the survey's comprehensiveness, "The report just isn't used." Special Education Children with disabilities are among those at greatest risk of being left behind. The Individuals with Disabilities Education Act (IDEA) establishes the right of children with disabilities to a free, appropriate public education. Through this legislation, which the Congress passed in 1975, the federal government plays an important role in helping children with disabilities meet high academic standards and participate fully in American society. The 2003 budget provides $8.5 billion for the Special Education Grant to States program, a $1 billion increase over 2002. The budget also provides $437 million for states to identify and serve infants and toddlers with disabilities, a $20 million increase. In many cases, this early intervention can reduce or even eliminate the need for special education as children grow up. Who Is in Special Education? About six million school-aged children, roughly 10 percent of the total population, receive special education. Many of these children have easy-to-identify disabilities, like mental retardation and blindness. However, an increasing proportion of children in special education have disabilities that are more subjectively determined and difficult to diagnose. About half of all special education children are diagnosed as "learning disabled," and Department of Education data suggest the number of children with Attention Deficit/Hyperactivity Disorder has skyrocketed. These disabilities lack clear criteria for identification, and are applied inconsistently across schools. Many people are worried that some children are inappropriately referred to special education. For instance, many children may be referred to special education not because of a real disability but because they were never properly taught how to read. Also, Department data show that minority children are disproportionately represented in special education. The President's Commission on Excellence in Special Education will pay particularly close attention to these issues and report its recommendations to the President. While the President supports the principles embodied in the IDEA, the law needs reform. The Administration plans to develop its reform proposal in the coming year. To support this effort, the President has formed a Commission on Excellence in Special Education, which will report back to the President this year. Job Training Programs in the Department of Education The 2003 Budget will launch a multi-year effort to reform job training programs across the federal government, target resources to programs with documented effectiveness, and eliminate funding for ineffective, duplicative, and overlapping programs (see the Department of Labor chapter). This crosscutting reform includes three programs in the Department of Education whose primary mission is to help individuals prepare for the labor market and lead productive lives. Vocational Rehabilitation. State Vocational Rehabilitation (VR) agencies help individuals with disabilities prepare for and obtain employment to the extent of their abilities. VR also supports the President's New Freedom Initiative to help people with disabilities lead independent lives. People with disabilities are less likely to be employed than those without disabilities; one of VR's main purposes is to offer job training to help people with disabilities obtain competitive jobs. In addition, persons with disabilities can more effectively participate in the integrated workforce with the special accommodations and supports afforded to them through the VR program. State VR agencies, for instance, also offer adaptive technologies to individuals with physical impairments and other disabilities, as well as job coaches and personal assistants for those with the most significant disabilities. While nationwide state VR agency performance has improved in recent years, there is still wide variation among states. As a result, VR is an area the Department will highlight in the President's initiative to tie budget decisions to program performance. As part of this initiative, the budget proposes a new $30 million incentive grant which will be allocated to state VR agencies based on their performance in helping individuals with disabilities obtain competitive jobs. Vocational and Adult Education. The Department of Education provides grants to states to support programs that develop the academic, vocational, and technical skills of students in high schools and community colleges. Vocational education is primarily a state and local responsibility. Federal funds account for only about seven percent of total vocational education spending. The Department also awards grants to states to help adults become literate, obtain a high school diploma or its equivalent, and learn skills necessary for work and self-sufficiency. Research shows that there is a strong relationship between education and earnings; adult education programs often provide the foundation for further job training and workforce preparedness. The federal laws that authorize vocational and adult education programs will expire at the end of 2003. The 2003 Budget maintains funding at the 2002 level while the Administration examines what reforms-including fundamental changes to the federal role in vocational education-may be needed in these areas. Postsecondary Education The Administration's strategy for postsecondary education is to focus resources on student aid programs that help needy students pay for college, higher education programs that help students prepare for postsecondary education, and institutional development programs that provide support for colleges which serve low-income and minority students. Pell Grants. Pell Grants help increase college enrollment rates among disadvantaged students. In 1999, only 49 percent of high school graduates from the poorest families went to college, compared to 76 percent of students from the wealthiest families. Research has shown that increases in grant aid result in significant increases in enrollment, particularly for low-income students. The 2002 appropriations bill created a serious fiscal problem for 2002 by underfunding the Pell Grant program. The Congress mandated a Pell Grant maximum award of $4,000, but provided only enough funding to pay for a maximum award of $3,600, creating a shortfall of nearly $1.3 billion. To rectify this problem, the budget proposes to redirect resources from unrequested earmarks and low-priority programs in 2002 to the Pell Grant program. The Administration will propose $10.9 billion for Pell in 2003 to help over four million students afford college. Historically Black Colleges and Universities (HBCUs) and Hispanic-Serving Institutions (HSI8). Federal resources help these institutions, which provide opportunity for some of the most disadvantaged students in the nation, improve their educational programs. The President has committed to increasing funding for HBCUs and for HSIs by 30 percent between 2001 and 2005. The budget proposes $213 million for HBCUs, $51 million for Historically Black Graduate Institutions, and $89 million for Hispanic Serving Institutions to keep these institutions on track to achieve the President's goal. TRIO and GEAR UP. These two programs, which help disadvantaged middle- and high-school students prepare for college, share similar goals but use different approaches. As part of the President's initiative to tie budget and performance, the Administration will assess the programs' effectiveness and develop strategies for 2004 to improve the performance of both and direct resources to the most effective strategies. Funding for these programs in 2003 is held steady at the 2002 level pending the results of this review. Teacher Loan Forgiveness. Under current law, teachers who work in high-poverty schools for five years may have up to $5,000 of their federal student loans forgiven. The budget proposes to expand this program to allow the math, science, and special education teachers who qualify for this program to have up to $17,500 of their student loans forgiven. Student Loans. The guaranteed and direct student loan programs provide $50 billion in aid each year to students and parents. The Administration is in the process of developing revisions to the method of calculating the cost estimates for these programs. The new method, when fully implemented, is expected to produce better cost estimates necessary for policy decisions and program management. While the budget reflects amounts calculated using the existing method, the Administration will complete work on a new estimation method for use in the Mid-Session Review of the 2003 Budget. In the interim, the Administration will adopt Congressional Budget Office estimates for purposes of the Budget Enforcement Act scoring of legislative proposals. Educational Research This year, the Administration will propose legislation to reform the Department's research office, the Office of Educational Research and Improvement. The budget includes a $53 million increase for research activities to support important new programs and emphasizes scientifically based research. A major focus will be placed on identifying the most effective strategies for improving reading comprehension. Improving Student Financial Aid Operations Eliminating Fraud and Error in Student Aid Programs. Through the Department of Education, the federal government supports approximately $60 billion in student financial aid annually. Programs in that portfolio are vulnerable to fraud and error because the Department cannot verify students' income effectively. Students are awarded Pell Grants and loans based on the financial resources they report on their aid applications. The Education Department currently verifies income information on applications by asking 30 percent of applicants to provide copies of their, and in the case of dependent students, their parents' tax returns to their schools' financial Student Aid Fraud Last March, the Department of Education's aid offices. Students easily can receive more funding than they are entitled to by changing their returns or claiming they did not file. The President proposes a legislative change to allow IRS to match the income reported on student aid applications with tax return data. An estimated $138 million would be saved in 2003. Reducing Costs. Reducing administrative costs was one of the key purposes of 1998 legislation that established a performance-based organization to administer student financial assistance programs. Although the Department of Education has made some progress, weak accounting practices and an overly complex budget structure have made it difficult for the Department's management to measure progress in reducing costs. Furthermore, of the more than $900 million provided annually for administrative funding, more than four-fifths has not been subject to annual review in the congressional appropriations process. Beginning with the 2003 Budget, accountability for these funds will be strengthened. Funding from four sources will be consolidated into a single discretionary account for student aid administrative costs. The account will be subject to annual appropriations by Congress. Annual budget requests will be tied to unit cost targets for major business processes (e.g., application processing, loan origination, loan servicing) and to annual estimates of participation in the various loan and grant programs. Strengthening Management In April 2001, the Secretary of Education established a Management Improvement Team to develop an agency plan for management excellence. The Department of Education faced particularly significant challenges in financial management and student financial assistance programs, which have kept the Department on the General Accounting Office's list of high-risk programs since 1990. The Secretary set two goals: earn a clean financial audit, and eliminate fraud and error in student aid programs. The Department of Education's Blueprint for Management Excellence spelled out robust plans to address longstanding financial management problems, such as high risk of waste, fraud, and abuse in student financial aid programs, and information technology security. Overall, some 140 action items were put into play. Areas still lacking detailed or adequately defined plans include human capital, competitive sourcing, budget and performance integration, and some e-government projects. However, the Department has established deadlines for developing these plans. In addition, Education is actively implementing the President's Faith-Based and Community Initiative in order to improve the delivery of social services by drawing on a wider range of service providers. Education has identified barriers to participation in its programs and has developed a strong plan for eliminating those barriers. The following management scorecard reflects the Department of Education's September 30, 2001, status on each of the initiatives in the President's Management Agenda. The Department's management during the coming year will closely track progress on the President's Management Agenda and the Department's Blueprint for Management Excellence. |