So if you say to the states, "We'll hold you accountable. You just improve student performance, and we'll give you the money," that will give all the governors the flexibility to get the job done.

--Governor Gray Davis (D) of California, February 21, 1999, on NBC's Meet the Press

Congress this week will consider a bipartisan measure to expand the current Education Flexibility Partnership Demonstration Act of 1994, or Ed-Flex, which empowers 12 states to waive federal regulations within certain federal education programs. The new measure (S.280/H.R.800), sponsored by Senators William Frist (R-TN) and Ron Wyden (D-OR) and Representatives Mike Castle (R-DE) and Tim Roemer (D-IN), is endorsed already by the country's governors and would allow all 50 states this flexibility.

Certainly, every state could use more flexibility to address its unique education problems, and S.280/H.R.800 is a step in the right direction. Unfortunately, Ed-Flex does not go far enough. As Members of Congress consider the re-authorization of the Elementary and Secondary Education Act of 1965 (ESEA) and Goals 2000, they should strengthen the accountability standards in Ed-Flex and include more programs and flexibility to create a "Super" Ed-Flex program.

Consider the following:

1. According to a U.S. General Accounting Office report last September, Ed-Flex's narrowly structured waivers "generally do not address school districts' major concerns."¹ The report concludes that "federal flexibility efforts neither reduce districts' financial obligations nor provide additional federal dollars"; and, because the flexibility is limited to specific programs, the districts' "ability to reduce administrative effort and streamline procedures is also limited."

2. Ed-Flex does not allow states to consolidate funds from different federal programs to use on their unique goals and priorities. For example, the priority of Arkansas Governor Mike Huckabee (R) in fiscal year (FY) 2000 is to equalize school funding. Governor Gray Davis (D) of California is investing in reading, teacher quality, and school accountability initiatives. And Florida Governor Jeb Bush (R) is championing a school reform package that offers, among other things, scholarships to students in Florida's worst-performing schools to attend a school of their parents' choice. Ed-Flex program funds cannot be poured easily into such initiatives without jumping through several bureaucratic hoops; and federal funds cannot be combined into a sizeable sum to help states to reach their goals more directly.

3. Ed-Flex does not include strict accountability measures to ensure that federal funds boost academic achievement. Education reform initiatives should improve students' academic achievement, not simply fulfill bureaucratic mandates. In its current form, Ed-Flex is not clear in defining academic achievement as its ultimate goal in awarding states greater flexibility. Ed-Flex states still are required to reach the goals of each individual program, however redundant those goals may be.

HOW SUPER ED-FLEX WOULD WORK

Under Super Ed-Flex, interested states or large school districts would receive maximum flexibility in administering up to 18 formula-based K-12 education programs (see the Appendix for methodology). In return, they would have to demonstrate improvements in academic achievement. Table 1 outlines how much each participating state would receive under Super Ed-Flex. In return for these flexible funds, a Super Ed-Flex program would set:

• Clear performance objectives. Each state or qualifying school district would enter into a binding agreement with the federal government (much like charter schools do with their sponsors) with clear performance objectives and a timetable for academic improvement. The plan would have to include target goals for students previously served by those programs. To test for academic improvement, states could use the state-level National Assessment of Educational Progress test, a commercial test, a state test, or another mutually acceptable test.

• Rewards for meeting goals. The federal government would institute a bonus pool of funds for states or school districts that met their performance goals.

• The ability to remain in the current program. States or school districts that did not wish to consolidate categorical programs under this plan would continue to operate the programs as prescribed under the new ESEA plan to be re-authorized by Congress.

Such a Super Ed-Flex program would fulfill two important goals.

First, it would acknowledge that education is a state and local prerogative and responsibility, and allow states and localities to use federal funds (minus bureaucratic strings) to fulfill their unique goals.

Second, it would take a bold approach to reforming the current ESEA programs by shifting their focus to academic achievement instead of bureaucratic inputs. After 34 years and $118 billion, ESEA's key program, Title I, has not reduced the gap in achievement between low-income and upper-income students. President Bill Clinton has acknowledged this problem; but instead of unleashing the states and allowing them more flexibility in exchange for results, he is pushing for such specific programs as ending social promotion, creating report cards for schools, and instituting summer and afterschool programs. Instead of cutting federal red tape and allowing states and localities to figure out what is best for their students, the President is prescribing reforms that overlook each state's unique makeup.

Super Ed-Flex would keep the ESEA and any changes made to it intact, but it also would allow some states maximum fiscal autonomy and flexibility to focus for the first time only on boosting the academic achievement of students. If a state like California adopted Super Ed-Flex, it would receive just over $1.5 billion of flexible federal money (see Table 1) to implement the governor's reading initiative or boost teacher quality. But it would have to show parents, taxpayers, and the U.S. Secretary of Education how it had improved the academic achievement of all its students. Texas, which currently is considered a model Ed-Flex state thanks to its strong accountability system, could receive nearly $1.1 billion under Super Ed-Flex to continue implementing its own reforms. It would need only to show how all its students were excelling on the Texas Assessment of Academic Skills Test.

CONCLUSION

Under a Super Ed-Flex plan, the federal government's role would resemble that of a shareholder whose interest lay in promoting results for taxpayers. Instead of micromanaging the day-to-day activities of the Super Ed-Flex funds, it would provide funding to states and localities in exchange for proof of agreed-on results. If the money invested yields a high return, a wise shareholder naturally will invest more; if not, he will have to come up with alternative ways to receive a better return for the invested dollars.

As Kentucky Governor Paul E. Patton (D) recently told The Los Angeles Times, "We need the federal government as a limited partner and us as a general partner." Super Ed-Flex respects this balance of power while assuring that every dollar spent on education is a dollar spent to boost academic achievement.

Nina Shokraii Rees is a former Education Policy Analyst at The Heritage Foundation and Kirk A. Johnson, Ph.D., is Policy Analyst in The Center for Data Analysis at The Heritage Foundation.

APPENDIX:
METHODOLOGY FOR GENERATING SUPER ED-FLEX FIGURES

Super Ed-Flex would increase the number of Ed-Flex programs from 6 to 18. These would include primarily K-12 programs that disseminated federal funding to states and/or localities on a formula basis.² Currently, the Ed-Flex program allows only 12 states (Colorado, Illinois, Iowa, Kansas, Maryland, Massachusetts, Michigan, New Mexico, Ohio, Oregon, Texas, and Vermont) to consolidate the funding of just six programs:

• Title I of the Elementary and Secondary Education Act, Aid to Disadvantaged Children;

• Title II, the Eisenhower Professional Development Program;

• Title IV, the Safe and Drug-Free Schools and Communities Program;

• Title VI, Innovative Education Program Strategies;

• Title VII Part C, Emergency Immigrant Education; and

• The Carl D. Perkins Vocational-Technical Education Act.

Under S. 280 and H.R. 800, all 50 states would be able to participate in Ed-Flex. States also would be able to waive parts of Title III of the ESEA, Technology for Education.

Table 2 outlines the total FY 1999 appropriations if Super Ed-Flex existed today. Data are based on the FY 1999 figures developed in November 1998 by the Budget Service of the U.S. Department of Education. These figures are based solely on Department of Education estimates and may change over the course of the fiscal year. These figures do represent, however, the most current data publicly available on these programs.

1. U.S. General Accounting Office, "Elementary and Secondary Education: Flexibility Initiatives Do Not Address Districts' Key Concerns About Federal Requirements," GAO/HEHS-98-232, September 30, 1998, p. 3.

2. The two Perkins Vocational Education programs also are generally available for junior colleges and technical schools.