Education Recovery Benefits: Using Coronavirus State and Local Fiscal Recovery Funds to Address Children’s Academic, Social, Emotional, and Mental Health Needs

Key Points

• The $350 billion of Coronavirus State and Local Fiscal Recovery Funds, a new program under the American Rescue Plan, provides unprecedented flexible funding to help state and local governments respond to their communities’ public health challenges and economic needs created by the pandemic.
• Among the allowable uses of funds are programs and strategies to address the education and well-being needs of children in disproportionately impacted populations and communities.
• Governors, mayors, and other state and local leaders should consider using the funds to establish individual education recovery benefits that provide low-income families with direct financial assistance to address the inequities exacerbated by closed schools and poor-quality remote learning. 
• The federal government has trusted low-income families to spend other direct cash assistance for their own best interests. State and local governments should also trust them to spend an education recovery benefit for their children’s best interests.

Read the PDF.

Introduction

The American Rescue Plan (ARP) provides $126 billion to assist with safely reopening schools and accelerating the academic recovery of students through the Elementary and Secondary Emergency Relief Fund (ESSER). In Section 9901, ARP authorizes the much more flexible $350 billion of Coronavirus State and Local Fiscal Recovery Funds allocated by the US Treasury Department, which may also be used for educational purposes. The flexibility offered through this program provides the opportunity for state and local leaders to provide direct financial assistance to underserved families to help address the well-being of children and accelerate their academic recovery (including through tutoring and parent-directed compensatory education services), social and emotional development, educational enrichment, and career development. 

The Coronavirus State and Local Fiscal Recovery Funds is meant to bolster state, local, territorial, and tribal government responses to the public health emergency and economic disruptions caused by the novel coronavirus (Table 1).¹ Different funding formulas allocate the funds to these entities (Table 2) but provide significant discretion to state and local leaders in how to best deploy the funds to stabilize revenue, address budget shortfalls, support public health efforts, and address negative economic impacts of COVID-19.²

Guidance from the US Department of the Treasury also points to ways these funds can be used to address the needs of children who were hurt by COVID-19. Among the suggested allowable uses are tutoring; expanding early learning educational services; improving summer, after-school, and other extended learning and enrichment programs; and providing additional funding to low-income schools.

As part of their portfolio of academic recovery activities, state and local governments should consider establishing education recovery benefits to provide direct financial assistance to low-income families. This targeted financial assistance would help offset the economic hardship low-income families face due to the unexpected expenses created by school closures such as childcare, learning pods, tutoring, tuition for in-person learning at another school, and specialized therapies.

The federal government has widely used direct financial assistance throughout the pandemic to provide income support, rental assistance, and food assistance for families. It has the advantages of speed and flexibility to meet individuals’ and families’ immediate needs in weathering the disruptions COVID-19 created.  

An education recovery benefit leverages this same mechanism to quickly provide flexible funding to low- to moderate-income and underserved families to address their children’s social, emotional, and mental health needs. The federal government has trusted low-income families to spend other direct cash assistance for their own best interests. State and local governments should also trust them to spend an education recovery benefit for their children’s best interests.

Read the full report.

Notes

1. US Department of the Treasury, “Coronavirus State and Local Fiscal Recovery Funds,” https://home.treasury.gov/policy-issues/coronavirus/assistance-for-state-local-and-tribal-governments/state-and-local-fiscal-recovery-funds.
2. US Department of the Treasury, “FACT SHEET: The Coronavirus State and Local Fiscal Recovery Funds Will Deliver $350 Billion for State, Local, Territorial, and Tribal Governments to Respond to the COVID-19 Emergency and Bring Back Jobs,” May 10, 2021, https://home.treasury.gov/system/files/136/SLFRP-Fact-Sheet-FINAL1-508A.pdf.