State superintendent cautions educators about spending $207 million from feds

From Hebron's $210,000 to Gary's $3.2 million, regional school districts are set to reap a windfall of federal funding to preserve teaching jobs, but the state's top educator is urging districts to tread cautiously in spending it.

Gov. Mitch Daniels last week submitted Indiana's application for a slice of the $10 billion federal Education Jobs Fund signed by President Barack Obama last month.

Indiana's allocation is $207 million, which it will distribute through its education funding formula. Illinois is set to receive $415 million. The first distributions will be available in November, with a September 2012 deadline to spend the funds.

In a letter to superintendents and school board members, Indiana Superintendent of Public Instruction Tony Bennett cautioned the educators to "be careful with how and when you spend these funds" as they await a clearer picture of their financial situation and the state's.

Bennett urged "reserving" the funds until education budgeting in the upcoming General Assembly becomes clearer.

U.S. Education Secretary Arne Duncan has estimated the new funding could support 160,000 jobs.

Critics say the program will subsidize the status quo by removing incentive to trim bloated budgets in lean times and will reward districts that haven't made tough budget cuts.

Speaking in Valparaiso last month, Gov. Daniels said Indiana would accept the money, but dismissed the federal program as subsidization of free-spending states by fiscally careful ones. Indiana would not have lost teachers without it, he said, adding it could result in administrators being retained who might otherwise have been cut.

Critics also decry the cuts to food stamp and adolescent literacy programs that made the jobs funding available. 

Hebron schools Superintendent George Letz said the funding represented "a bandage approach to the problem" that helped for a few years, then was gone.

A district could hire a teacher, but without further funding, that person would be out of a job in two years, Letz said. Alternately, a district could be saddled with a new salary commitment.

Districts can use the funds to pay the salaries of employees from principals to counselors to bus drivers, but Bennett said in his letter it was his "preference" the money be used for classroom instruction.

Hammond Federation of Teachers President Patrick O'Rourke said he has not seen specifics on how the money can be spent.

"The (American Federation of Teachers) lobbied very hard for this money," he said. "It's going to be a breath of fresh air. It will help us to relieve the stress on the general fund. I'm assuming that money can be used to hire people in tight areas such as match and science."

Many districts across the region have avoided layoffs in the past year by reducing teacher ranks through attrition and retirement incentives.