State spending on education during the COVID-19 pandemic

• In Event: Consequences of State Policies on Higher Education Institutions

Abstract

The COVID-19 pandemic had unprecedented effects on K-12 and postsecondary education, and it was met by equally unprecedented levels of federal investments. The U.S. Department of Education distributed massive grants to support education, including the Governor’s Emergency Education Relief (GEER) program which distributed $4.25 billion in two waves to governors to support education in their state. In this paper, we explore (1) How did governors allocate between LEAs and IHEs, and how do spending decisions relate to political contexts (e.g., partisanship, higher education governance structure)? (2) How do IHE allocation decisions relate to institutional and student characteristics (e.g., sector, student demographics)?, and (3) How did sub-awardees (i.e. individual institutions) in each state spend their funds, and how do those spending decisions relate to institutional and student characteristics? 

We leverage ED’s Education Stabilization Funds annual performance reporting files, which contain complete details on state GEER spending at the state and institution level, including categories of spending at institutions (e.g. remote learning, covid testing). We collect state-level details about the governor including political party and term in office, and other state education data including the higher education governance structure and postsecondary attainment rates. For the institution level analysis, we link data from the Integrated Postsecondary Education Data System on institution traits and key outcome measures.

We use multivariate regression to explore the relationship between our primary outcome of interest of spending choice and our two categories of explanatory variables; governor/state characteristics and institutional characteristics. We find 70% of states allocated to both LEAs and IHEs in GEER I, whereas a smaller proportion (47%) made similar choices in GEER II. A much larger share of states directed all funds to “other entities” (e.g., education nonprofits) in GEER II (14%). Republican governors appear somewhat less likely to allocate to IHEs in the first year of funding, although this may be offset by a slightly greater likelihood of allocation to IHEs in the second year. Across states that spent at the postsecondary level, the most amount of funding went to supporting distance learning in the first round of funding, followed by direct student financial aid. This switched in GEER II with a greater share of states reporting institutions spent on direct student aid as the pandemic progressed. Other categories like student basic need support and staff maintenance were less common spending categories. Our full results including additional multivariate analyses and further investigation into institutional spending decisions are still forthcoming. 

This project provides insights into the decision making of governors around education spending and the broader allocation of federal funds. We bring together literature on public policy and education finance, bureaucratic politics, and crisis decision-making and governing. The COVID-19 pandemic provides a useful case study for understanding how executives made decisions with incomplete information during a crisis, and this work will shed light on the relationship between different governance approaches and patterns of spending on education.

Author

• Katharine Meyer, Brookings Institution
  Presenting Author