Florida Gets a Waiver on Stimulus Funds

Washington — To qualify for a portion of the nearly $54-billion in federal stimulus money meant to shore up public-school and higher-education budgets, states must provide at least as much money as they did for those areas in 2006.

Florida, however, applied to the U.S. Education Department for a waiver from that requirement, called a “maintenance of effort” provision, because it had fallen short, thanks to its dismal economy and enormous budget gaps. The state had to close a $2.3-billion revenue shortfall in the previous fiscal year, and is facing a $5.8-billion hole for the next budget year.

Education Secretary Arne Duncan today approved that waiver, giving the Sunshine State access to more than $1.8-billion from the “state fiscal-stabilization fund” this year and making it eligible to apply for an additional $890-million next year, for a total of nearly $2.7-billion.

In order to qualify for the exception, states have to show that they are making education cuts that are proportional to the overall budget gap. In other words, if a state has a revenue shortfall of 10 percent, it can’t cut its education budget by more than that percentage and receive a waiver. Mr. Duncan approved the waiver for Florida after determining that the state met the qualifying conditions. —Eric Kelderman