[House Hearing, 114 Congress]
[From the U.S. Government Publishing Office]


                     SUPPLANTING THE LAW AND LOCAL
                      EDUCATION AUTHORITY THROUGH
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=======================================================================

                                 HEARING

                               BEFORE THE

                    SUBCOMMITTEE ON EARLY CHILDHOOD,
                  ELEMENTARY, AND SECONDARY EDUCATION

                         COMMITTEE ON EDUCATION
                           AND THE WORKFORCE

                     U.S. House of Representatives

                    ONE HUNDRED FOURTEENTH CONGRESS

                             SECOND SESSION

                               __________

           HEARING HELD IN WASHINGTON, DC, SEPTEMBER 21, 2016

                               __________

                           Serial No. 114-53

                               __________

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                COMMITTEE ON EDUCATION AND THE WORKFORCE

                    JOHN KLINE, Minnesota, Chairman

Joe Wilson, South Carolina           Robert C. ``Bobby'' Scott, 
Virginia Foxx, North Carolina            Virginia
Duncan Hunter, California              Ranking Member
David P. Roe, Tennessee              Ruben Hinojosa, Texas
Glenn Thompson, Pennsylvania         Susan A. Davis, California
Tim Walberg, Michigan                Raul M. Grijalva, Arizona
Matt Salmon, Arizona                 Joe Courtney, Connecticut
Brett Guthrie, Kentucky              Marcia L. Fudge, Ohio
Todd Rokita, Indiana                 Jared Polis, Colorado
Lou Barletta, Pennsylvania           Gregorio Kilili Camacho Sablan,
Joseph J. Heck, Nevada                 Northern Mariana Islands
Luke Messer, Indiana                 Frederica S. Wilson, Florida
Bradley Byrne, Alabama               Suzanne Bonamici, Oregon
David Brat, Virginia                 Mark Pocan, Wisconsin
Buddy Carter, Georgia                Mark Takano, California
Michael D. Bishop, Michigan          Hakeem S. Jeffries, New York
Glenn Grothman, Wisconsin            Katherine M. Clark, Massachusetts
Steve Russell, Oklahoma              Alma S. Adams, North Carolina
Carlos Curbelo, Florida              Mark DeSaulnier, California
Elise Stefanik, New York
Rick Allen, Georgia

                    Juliane Sullivan, Staff Director
                 Denise Forte, Minority Staff Director
                                 
                                 
                             ----------                                

  SUBCOMMITTEE ON EARLY CHILDHOOD, ELEMENTARY, AND SECONDARY EDUCATION

                     TODD ROKITA, Indiana, Chairman

Duncan Hunter, California            Marcia L. Fudge, Ohio,
Glenn Thompson, Pennsylvania           Ranking Minority Member
Dave Brat, Virginia                  Susan A. Davis, California
Buddy Carter, Georgia                Raul M. Grijalva, Arizona
Michael D. Bishop, Michigan          Gregorio Kilili Camacho Sablan,
Glenn Grothman, Wisconsin              Northern Mariana Islands
Steve Russell, Oklahoma              Suzanne Bonamici, Oregon
Carlos Curbelo, Florida              Mark Takano, California
                                     Katherine M. Clark, Massachusetts
                            
                            
                            C O N T E N T S

                              ----------                              
                                                                   Page

Hearing held on September 21, 2016...............................     1

Statement of Members:
    Fudge, Hon. Marcia, L., Ranking Member, Subcommittee On Early 
      Childhood, Elementary, and Secondary Education.............     4
        Prepared statement of....................................     6
    Rokita, Hon. Todd, Chairman, Subcommittee On Early Childhood, 
      Elementary, and Secondary Education........................     1
        Prepared statement of....................................     4

Statement of Witnesses:
    Canavero, Dr. Steve, Superintendent of Public Instruction, 
      Nevada Department of Education.............................     8
        Prepared statement of....................................    11
    Gordon, Ms. Nora, Ph.D., Associate Professor, McCourt School 
      of Public Policy, Georgetown University, and Research 
      Associate, National Bureau of Economic Research............    28
        Prepared statement of....................................    30
    Owens, Mr. Ryan, Executive Director, Cooperative Council for 
      Oklahoma School Administration.............................    15
        Prepared statement of....................................    17
    Sargrad, Mr. Scott, Director, K-12 Education Policy, Center 
      for American Progress......................................    21
        Prepared statement of....................................    24

Additional Submissions:
    Ms. Fudge:
        Letter dated April 28, 2016, from The Leadership 
          Conference on Civil and Human Rights...................    58
        Letter dated May 10, 2016, from Teach Plus...............    61
        Letter dated May 27, 2016, from National Urban League....    67
        Letter dated August 31, 2016, from Civil and Human Rights 
          Coalition..............................................    69
        Letter dated August 31, 2016, from Teach Plus............    70
        Letter dated September 1, 2016, from Congressional 
          Hispanic Caucus........................................    71
        Letter dated September 1, 2016, from MALDEF..............    72
        Letter dated September 2, 2016, from National Council of 
          LaRaza (NCLR)..........................................    73
    Chairman Rokita:
        Slides...................................................    75
        Questions submitted for the record.......................    83
    Questions submitted for the record by:
        Bishop, Hon. Michael D., a Representative in Congress 
          from the State of Minnesota............................    83
        Carter, Hon. Buddy, a Representative in Congress from the 
          State of Georgia...................................81, 83, 85
        Curbelo, Hon. Carlos, a Representative in Congress from 
          the State of Florida...............................81, 83, 85
        Grothman, Hon. Glenn, a Representative in Congress from 
          the State of Wisconsin.................................    81
        Hunter, Hon. Duncan, a Representative in Congress from 
          the State of California................................    81
        Russell, Hon. Steve, a Representative in Congress from 
          the State of Oklahoma..................................    85
        Thompson, Hon. Glenn, a Representative in Congress from 
          the State of Pennsylvania..............................81, 85
    Response to questions submitted for the record:
        Dr. Canavero.............................................    87
        Ms. Gordon...............................................    91

 
                     SUPPLANTING THE LAW AND LOCAL
                      EDUCATION AUTHORITY THROUGH
                            REGULATORY FIAT

                              ----------                              


                     Wednesday, September 21, 2016

                     U.S. House of Representatives

               Committee on Education and the Workforce,

  Subcommittee on Early Childhood, Elementary, and Secondary Education

                            Washington, D.C.

                              ----------                              

    The Subcommittee met, pursuant to call, at 10:01 a.m., in 
Room 2175, Rayburn House Office Building, Hon. Todd Rokita 
[chairman of the subcommittee] presiding.
    Present: Representatives Rokita, Thompson, Carter, Bishop, 
Grothman, Fudge, Davis, Bonamici, and Clark.
    Also Present: Representatives Kline, Scott, Polis, and 
Adams.
    Staff Present: Janelle Gardner, Coalitions and Members 
Services Coordinator; Tyler Hernandez, Deputy Communications 
Director; Amy Raaf Jones, Director of Education and Human 
Resources Policy; Nancy Locke, Chief Clerk; Dominique McKay, 
Deputy Press Secretary; Krisann Pearce, General Counsel; Mandy 
Schaumburg, Education Deputy Director and Senior Counsel; 
Alissa Strawcutter, Deputy Clerk; Leslie Tatum, Professional 
Staff Member; Brad Thomas, Senior Education Policy Advisor; 
Sheariah Yousefi, Legislative Assistant; Tylease Alli, Minority 
Clerk/Intern and Fellow Coordinator; Jamitress Bowden, Minority 
Press Assistant; Jacque Chevalier, Minority Deputy Education 
Policy Director; Denise Forte, Minority Staff Director; Mishawn 
Freeman, Minority Staff Assistant; Brian Kennedy, Minority 
General Counsel; Alexander Payne, Minority Education Policy 
Advisor; and Aneesh Sahni, Minority Education Policy Fellow.
    Chairman Rokita. Good morning, and welcome to today's 
hearing. When the committee last met to discuss the Every 
Student Succeeds Act, we heard concerns from State and local 
education leaders that the administration was not implementing 
the law in a way that respects its letter and intent.
    Since that time, the Department of Education has released a 
regulatory proposal that I find so unprecedented and so 
unlawful, in fact, that it demands its own examination, which 
we are going to do today.
    The proposal I am referring to is the department's proposed 
``supplement not supplant'' regulation. This proposal changes 
the longstanding policy that Federal funds supplement rather 
than supplant State and local resources.
    For years, the rule was applied differently depending on 
how many low-income students the school served. As a result, 
schools faced different requirements. Some are more onerous 
than others.
    That changed with the bipartisan Every Student Succeeds 
Act, legislation that again was passed with overwhelming 
support from both Republicans and Democrats.
    Now, according to the law, the rule should be enforced 
equally across every school. To do that, the bipartisan law, 
again that the President signed, says districts only have to 
show that funds are distributed in a way that does not take 
into account Federal resources, and Congress deliberately chose 
not to prescribe a specific approach or outcome. I remember 
this. It was in the final negotiations.
    The law also clearly prohibits the Secretary of Education 
from interfering in the process. However, that is exactly what 
the department and the Secretary is doing with their proposed 
rule, and the consequences will be significant. It would be one 
thing if it was a distinction without a difference, but I think 
as we are going to hear today, the consequences will be 
significant.
    As Chairman Kline himself explained when the regulation was 
proposed, it threatens to impose a multibillion regulatory tax 
on schools across the country. To comply with the policy, many 
school districts will have no choice but to change their hiring 
practices and relocate their teachers. Other communities may 
have to raise taxes because they simply do not have the 
resources to meet this new burden. Some districts may have to 
do both.
    So regardless of how a district must cope with the new 
regulation, the bottom line is that schools will be forced to 
make decisions based on getting numbers to work and not on what 
is in the best interest of their students, and the Federal 
Government will have unprecedented control over local education 
funding.
    The department has said its proposal will provide 
``flexibility,'' but it really just dictates a short list of 
options, and frankly bad options at that. At the end of the 
day, it will be America's poorest neighborhoods that are 
impacted the most, and that is the last thing we intended as 
Congress when it passed the Every Student Succeeds Act.
    In fact, Congress considered similar reforms during the 
debate of the legislation. We focused, for example, on a 
separate provision you may recall, comparability; instead, 
Congress specifically chose not to go down that road, not to 
touch that provision, and flat out rejected adopting a policy 
like the very one the department is proposing now.
    The department insists that their supplement not supplant 
proposal is not related to comparability, but even the 
nonpartisan Congressional Research Service has explained how 
this proposal is essentially an indirect way to amend the 
comparability provision.
    In short, this regulatory scheme is an attempt to 
accomplish something Congress specifically chose not to do. 
Anyone who was involved in passing the Every Student Succeeds 
Act knows that, whether they are willing to say so or not.
    Still, even if the department were confused about the 
intent of the law, nothing excuses the fact that what it is 
proposing is simply unlawful. Again, if you look at the quotes 
on the screen, you can see that this language is taken directly 
from the law, the Every Student Succeeds Act specifically 
prohibits the Secretary from, quote ``prescribing the specific 
methodology a local education agency uses to allocate State and 
local funds to each school receiving the assistance,'' close 
quote.
    The department claims that is not what they are doing, but 
with its limited list of options, it is clear that is exactly 
what is happening. That is why we have called on the department 
to throw this punitive policy out and to implement the law as 
it was written and as intended.
    For too long, our schools were forced to contend with a 
failed top down approach to education, and that all changed 
with the Every Student Succeeds Act, but it seems the 
department has not learned this or chooses to ignore it, and is 
intent on undermining those important bipartisan reforms.
    We will do everything within this committee's power to 
ensure that does not happen. This hearing is part of our 
efforts to protect students, families, and taxpayers from this 
unprecedented and unlawful regulatory scheme, and just as 
importantly, to help every child receive an excellent 
education, which I know that is why we are all here.
    The best chance we have to accomplish that critical goal is 
to ensure that the Every Student Succeeds Act is implemented 
according to the letter and intent of the law as we wrote it.
    I look forward to hearing from our witnesses today and how 
this proposal is impacting their local communities across this 
country.
    With that, I will yield to Ranking Member Fudge, Ms. Fudge, 
for her opening remarks.
    [The statement of Chairman Rokita follows:]

Prepared Statement of Hon. Todd Rokita, Chairman, Subcommittee on Early 
             Childhood, Elementary, and Secondary Education

    When the committee last met to discuss the Every Student Succeeds 
Act, we heard concerns from state and local education leaders that the 
administration is not implementing the law in a way that respects its 
letter and intent. Since that time, the Department of Education has 
released a regulatory proposal so unprecedented--and so unlawful--that 
it demands its own examination.
    The proposal I'm referring to is the department's proposed 
``supplement, not supplant'' regulation. This proposal changes the 
long-standing policy that federal funds supplement--rather than 
supplant--state and local resources. For years, the rule was applied 
differently depending on how many low-income students a school served. 
As a result, schools faced different requirements--some more onerous 
than others. That changed with the Every Student Succeeds Act--
legislation that was passed with overwhelming support from both 
Republicans and Democrats.
    Now, according to the law, the rule should be enforced equally 
across all schools. Districts only have to show that funds are 
distributed in a way that doesn't take into account federal resources, 
and Congress deliberately chose not to prescribe a specific approach or 
outcome. The law also clearly prohibits the secretary of education from 
interfering in the process. However, that is exactly what this proposed 
rule would do, and the consequences will be significant.
    As Chairman Kline explained when the regulation was proposed, it 
threatens to impose a multi-billion dollar regulatory tax on schools 
across the country. To comply with the policy, many school districts 
will have no choice but to change their hiring practices and relocate 
their teachers. Other communities may have to raise taxes because they 
simply don't have the resources to meet this new burden. Some districts 
may have to do both.
    Regardless of how a district must cope with the new regulation, the 
bottom line is that schools will be forced to make decisions based on 
getting the numbers to work--not on what's best for their students--and 
the federal government will have unprecedented control over local 
education funding.
    The department has said that its proposal will provide schools 
``flexibility,'' but it really just dictates a short list of bad 
options. And, at the end of the day, it will be America's poorest 
neighborhoods that are impacted most. That is the last thing Congress 
intended when it passed the Every Student Succeeds Act.
    In fact, Congress considered similar reforms during debate of the 
legislation that focused on a separate provision, comparability. 
Instead, Congress specifically chose not to touch that provision and 
flat out rejected adopting a policy like the one the department is now 
trying to impose.
    The department insists their ``supplement, not supplant'' proposal 
is not related to comparability, but even the nonpartisan Congressional 
Research Service has explained how this proposal is essentially an 
indirect way to amend the comparability provision. In short, this 
regulatory scheme is an attempt to accomplish something Congress 
specifically chose not to do. And anyone who was involved in passing 
the Every Student Succeeds Act knows that--whether they are willing to 
say so or not.
    Still, even if the department were confused about the intent of the 
law, nothing excuses the fact that what it is proposing is simply 
unlawful. Again--[gesture to quote on screens] as you can see in this 
language taken directly from the law--the Every Student Succeeds Act 
specifically prohibits the secretary from ``prescribing the specific 
methodology a local education agency uses to allocate state and local 
funds to each school receiving assistance.'' The department claims that 
is not what they're doing, but with its limited list of options, it's 
clear that is exactly what is happening. That's why we have called on 
the department to throw this punitive policy out and to implement the 
law as it was written and intended.
    For too long, our schools were forced to contend with a failed, 
top-down approach to education. That all changed with the Every Student 
Succeeds Act, but it seems the department hasn't learned its lesson and 
is intent on undermining those important, bipartisan reforms. We will 
do everything in our power to ensure that doesn't happen.
    This hearing is part of our efforts to protect students, families, 
and taxpayers from this unprecedented and unlawful regulatory scheme--
and just as importantly, to help every child receive an excellent 
education. The best chance we have to accomplish that critical goal is 
to ensure the Every Student Succeeds Act is implemented according to 
the letter and intent of the law.
    I look forward to hearing from our witnesses today and how they see 
this proposal impacting their local communities and schools across the 
country.
    With that, I will yield to Ranking Member Fudge for her opening 
remarks.
                                 ______
                                 
    Ms. Fudge. Thank you, Mr. Chairman, and thank you all for 
being here to provide testimony today.
    Certainly, this is a bipartisan law, and I believe if fully 
implemented, it will fulfill congressional intent and honor the 
Elementary and Secondary Education Act's civil rights legacy to 
promote and protect the right to educational opportunity for 
our Nation's most vulnerable children.
    Money matters. Poverty, especially when highly 
concentrated, presents unique educational challenges. It takes 
more money, not less, to provide equitable educational 
opportunities in high poverty communities, which is why 
Congress enacted Title I to serve as a supplemental funding 
stream for our Nation's neediest schools.
    Simply put, Title I is Congress' longstanding recognition 
that equal is not always equitable. Unfortunately, the intent 
of Title I has gone unrealized in school districts that 
continue to spend less to educate children in high poverty 
schools, perpetuating educational disparities within the 
district, despite drawing dollars from the same tax base.
    For too long, school district decisions on budget 
allocation have gone unchecked, with schools serving high 
poverty neighborhoods getting less than their fair share.
    The supplement not supplant, or SNS, requirement that Title 
I funds be in addition to State and local investment in schools 
receiving Federal dollars was first adopted by Congress in 
1969, and is the most important fiscal accountability provision 
in the entire law.
    In ESSA, Congress amended the provision. Compliance with 
SNS can no longer be determined using cost test demonstrations 
that allowed inequities to go unresolved. Congress did not 
agree, however, to remove or waive compliance with the SNS 
requirement.
    To support enforcement of the requirement, the U.S. 
Department of Education has a replacement proposed funds-based 
standard for compliance. The replacement honors the intent of 
Congress to permit for greater flexibility in how Title I 
dollars are spent, while ensuring those dollars are in fact 
supplemental to State and local investment.
    According to the proposal, each school district, not the 
Federal Government, determines its own formula for allocation 
of State and local funds. If a district's Title I schools are 
receiving their full share of State and local funds based on 
the district's formula, Title I dollars are truly supplemental, 
and the district is fully compliant with Federal law. That 
seems to be reasonable to me.
    The proposed rule seeks to address the annual underfunding 
of high poverty schools. Meeting this new funds-based standard 
for SNS compliance will likely be uncomfortable in some school 
districts, those where inequities have gone unchecked. It will 
likely drive hard conversations and new found accountability 
and transparency for local budgeting processes.
    While all of this may make compliance challenging, none of 
it disqualifies the proposal as inappropriate or illegal.
    This is just how my colleagues on the other side of the 
aisle are characterizing the proposal, as part of a larger GOP 
narrative, attacking the legitimacy of the executive branch.
    While their outrage and chest pumping is loud and 
distracting, I implore members of this subcommittee to not be 
distracted from the real issue.
    Nothing about the proposal supplants the law or local 
authority as the title of this hearing would suggest, unless 
they are speaking of the local authority to undermine 
congressional intent by using Title I dollars to plug budget 
holes that shortchange high poverty schools.
    I respectfully remind my friends in the majority that SNS 
is a Federal requirement to be enforced by the Federal agency. 
Nothing in ESSA allows a local educational authority to 
supersede that enforcement.
    Let me be clear. Enforcement of the supplement not supplant 
requirement is the responsibility of the department. It is my 
expectation and the expectation of Congress that the Secretary 
fulfill his responsibility to set an enforceable compliance 
standard for the nearly 15,000 school districts across the 
country.
    In ESSA, Congress made it very clear that supplement not 
supplant would remain a requirement. We chose to amend it, not 
to eliminate it. At this point, I find the rhetoric of those 
opposed disingenuous and devoid of any suggestion of what would 
constitute an acceptable standard of compliance. Decrying the 
standard put forth by the department without suggestion for 
what the standard should be is the same as asking for no 
standard and no enforcement.
    That, my friends, was not the bipartisan agreement of ESSA. 
With the enactment of ESSA, we have the opportunity to create a 
more equitable system of public education. It would be 
inexcusable for the Secretary to render the supplement not 
supplant requirement meaningless without a Federal standard for 
compliance.
    I thank the witnesses for taking time out of their busy 
schedules to participate in today's hearing, and look forward 
to learning about their experiences and recommendations for 
ensuring a smooth and successful transition to the new law in a 
way that preserves the critical Federal role to promote 
educational equity.
    Thank you, Mr. Chairman. I yield back.
    [The statement of Ranking Member Fudge follows:]

      Prepared Statement of Hon. Marcia L. Fudge, Ranking Member, 
  Subcommittee on Early Childhood, Elementary, and Secondary Education

    Thank you, Mr. Chairman. And thanks to our witnesses for appearing 
before the subcommittee today to discuss the implementation of the 
Every Student Succeeds Act, a bipartisan law that I believe, if 
implemented with fidelity, will fulfill both Congressional intent and 
honor the Elementary and Secondary Education Act's civil rights legacy 
to promote and protect the right to educational opportunity for our 
nation's most vulnerable children.
    Poverty, especially when highly concentrated, presents unique 
educational challenges. It takes more money, not less, to provide 
equitable educational opportunity in high-poverty communities, which is 
why Congress enacted Title I - to serve as a supplemental funding 
stream for our nation's neediest schools. Simply put, Title I is 
Congress' longstanding recognition that equal doesn't mean equitable.
    Unfortunately, the intent of Title I has gone unfulfilled in school 
districts that continue to spend less to educate children in their 
high-poverty schools than in their lower-poverty schools, perpetuating 
within-district educational disparities, despite drawing upon dollars 
from the same tax base.
    First adopted by Congress in 1969, the ``Supplement not supplant'' 
or ``SNS'' requirement that Title I funds be supplemental to state and 
local investment in schools receiving federal dollars is the most 
important fiscal accountability provision in the entire law. Congress 
agreed, in ESSA, to amend the provision to no longer allow compliance 
with SNS to be determined using current-practice cost test 
demonstrations that have allowed within-district inequities to go 
unresolved.
    Congress did not agree, however, to remove or waive compliance with 
the SNS requirement. And so, to ensure the integrity of the 
requirement, the U.S. Department of Education has put forward a 
proposal to replace the now disallowed cost test demonstrations with a 
new standard for compliance. One that honors the intent of Congress to 
allow for greater flexibility in how Title I dollars are spent while 
also ensuring those dollars are, in fact, supplemental to state and 
local investment.
    According to the proposal, each school district, not the federal 
government, comes up with its own formula for allocation of state and 
local funds. If the district's Title I schools are receiving their full 
share of state and local funds based on the district's own formula, 
Title I dollars are truly supplemental and the district is fully 
compliant with federal law. That seems like a reasonable standard to 
me.
    The proposed rule seeks to address, not ignore, the annual 
underfunding of high-poverty schools in setting forth the standard for 
compliance. Meeting this new standard for SNS compliance will
    be uncomfortable in some school districts. It will likely drive 
politically hard conversations and newfound accountability for local 
budgeting processes. And while all of that may be challenging, none of 
it inherently disqualifies the proposal as inappropriate or illegal.
    As part of a larger narrative and attack on the role of the 
executive branch, colleagues on the others side of the aisle are 
characterizing the proposal as inappropriate and illegal. Nothing about 
the proposal ``supplants'' the law or local authority as the title of 
this hearing would suggest - unless they're speaking of the local 
authority to undermine the spirit and intent of Title I by using it to 
plug budget holes.
    Let me be clear: enforcement of the supplement not supplant 
requirement is the responsibility of Department, and it is my 
expectation - and the expectation of House Democrats - that the 
Secretary fulfill his responsibility to set an enforceable standard for 
the nearly 15,000 school districts across this country. In ESSA, 
Congress made it very clear that supplement not supplant would remain a 
requirement. We chose to amend it, not eliminate it.
    With the enactment of ESSA we have the opportunity to create a more 
equitable system of public education. It would be inexcusable for the 
Secretary to render the supplement not supplant requirement meaningless 
without a federal standard for compliance and squander that 
opportunity.
    I thank the witnesses for taking the time out of their busy 
schedules to participate in today's hearing, and look forward to 
learning about their experiences and recommendations for ensuring a 
smooth and successful transition to the new law in a way that preserves 
the critical federal role in promoting educational equity.
    Thank you, and I yield back.
                                 ______
                                 
    Chairman Rokita. I thank the gentlelady. A quorum being 
present and pursuant to Committee Rule 7(c), all members will 
be permitted to submit written statements to be included in the 
permanent hearing record, and without objection, the hearing 
record will remain open for 14 days to allow such statements 
and other extraneous material referenced during the hearing to 
be submitted for the official hearing record.
    I will now turn to the introduction of our distinguished 
witnesses. First to testify will be Dr. Steve Canavero. He 
serves as the superintendent of public instruction for the 
Nevada Department of Education in Carson City, Nevada.
    Prior to this position, Dr. Canavero served as the deputy 
superintendent of student achievement at the Nevada Department 
of Education, and as the first director of the State Public 
Charter School Authority.
    Dr. Canavero has a background in evaluation and planning, 
and has worked as a teacher and principal. Welcome.
    Next, Mr. Ryan Owens serves as executive director for the 
Cooperative Council for Oklahoma School Administration in 
Oklahoma City, Oklahoma. Prior to this position, Mr. Owens 
served with the United Suburban Schools Association and the 
Oklahoma Education Coalition, the Oklahoma Education Technology 
Trust, and is an adjunct professor in the Colleges of Education 
at Southern Nazarene University and the University of Oklahoma 
at Tulsa. Welcome, sir.
    Next, Mr. Scott Sargrad serves as the managing director for 
the K-12 Education Policy team at the Center for American 
Progress in Washington, D.C., and in this position, Mr. Sargrad 
focuses on the areas of standards, assessments, school and 
district accountability systems, and school improvement.
    Prior to this position, Mr. Sargrad served as the deputy 
assistant secretary for policy and strategic initiatives with 
the Office of Elementary and Secondary Education at the U.S. 
Department of Education. Welcome, sir.
    Finally, Dr. Nora Gordon serves as associate professor of 
public policy with the McCourt School of Public Policy at 
Georgetown University, and as a research associate with the 
National Bureau of Education Research.
    Dr. Gordon's research focuses on fiscal federalism in 
American education policy, and the current and historical 
Federal role in elementary and secondary education. She is a 
member of the expert panel to the Department of Education on 
its study on the Title I formula as mandated by the Every 
Student Succeeds Act. Welcome to you as well.
    I will now ask our witnesses to raise your right hand. 
There is no need for you to stand.
    Do you solemnly swear or affirm that the testimony you are 
about to give will be the truth, the whole truth, and nothing 
but the truth?
    Let the record reflect that the witnesses all answered in 
the affirmative.
    Before I recognize you to give your testimony, let me 
briefly explain our lighting system, and sometimes it is a 
reminder for us up here, not just you all over there. You each 
have five minutes to present your testimony. When you begin, 
the light in front of you will turn green, of course. When one 
minute is left, it will be yellow, and will turn red when your 
time is over. Please respect those signals. When the red light 
occurs, I will ask you to wrap up your remarks almost 
immediately. Members, those of us here, will have five minutes 
each to ask questions.
    So with that, Dr. Canavero, I recognize you for five 
minutes.

     TESTIMONY OF STEVE CANAVERO, SUPERINTENDENT OF PUBLIC 
          INSTRUCTION, NEVADA DEPARTMENT OF EDUCATION

    Mr. Canavero. Thank you, Chairman Rokita, Chairman Kline, 
Ranking Member Fudge, and Ranking Member Scott, members of the 
subcommittee for the opportunity to testify today, and for your 
work to approve the Every Student Succeeds Act.
    This new law will allow Nevada to build on our existing 
education improvement efforts while at the same time setting 
high standards for student success.
    On behalf of the many chiefs like myself who are using this 
opportunity present under the Every Student Succeeds Act to 
transition our conversations away from Federal mandate to State 
priorities and finding opportunities within the Federal law and 
Federal funding to support our priorities, again, thank you.
    One of the most important aspects of the Every Student 
Succeeds Act is its focus on equity, as was mentioned here, its 
civil rights legacy. We must ensure all students have the 
opportunity to succeed and having access to the economic 
opportunities that a quality education provides, and that 
States, districts, and schools should be held accountable for 
clear and measurable results.
    In Nevada, Governor Brian Sandoval and the legislature have 
taken a number of steps to promote equity and improve student 
achievement. In 2005 alone, including additional financial and 
program supports for English learners and for students living 
in a poorest zip codes in Nevada; support for effective 
literacy instruction to raise student achievement in reading; 
several new programs for consistently underperforming schools, 
including an Achievement School District, which allows the 
State to intervene in failing schools; a Social Worker in 
Schools Program; student access to technology and professional 
development for teachers to utilize that technology in the 
classroom; and addressing educator quality by providing PD and 
improving the educator pipeline throughout the State.
    Each of these programs represents a substantial financial 
investment by the State to promote equity and achievement for 
our 460,000 students and schools. All told, Nevada's 
legislature invested roughly 340 million into additional 
funding into education in 2016 and 2017 alone. That is 
approximately a 10 percent increase in the State's education 
budget all going to students who need it most. And we intend to 
grow this investment on a biannual basis.
    It was these investments and my Governor and State strong 
commitment to equity that lead me to testify here today about 
the Department of Education's proposed supplement not supplant 
regulations. I know my fellow chief State school officers share 
similar concerns.
    The department's goals are laudable. It is clear 
underperforming schools need more funding to support their 
students' needs. However, imposing sweeping new Federal 
mandates on how school districts must spend their State and 
local funds in addition to the complicated way the proposed 
regulations approach equity and school funding could actually 
hurt State and local efforts to provide equity for all 
students.
    Here is a few reasons why. First, the regulations look only 
at the amount spent in Title I schools versus non-Title I 
schools. While the total dollars spent is important, it is not 
the only measure of how we support students. These regulations 
do not take into account other equity measures, such as 
improved access to educational opportunities like advanced 
placement, magnet schools, career and technical education 
programs, the arts, or effective educators. By ignoring these 
measures, the proposed regulations could harm State and local 
efforts to promote these measures to benefit students.
    In Nevada, our schools are providing these types of 
opportunities for all kids, and we seek to expand them. I fear 
the proposed regulations could result in significant 
restructuring of these opportunities to allow students to 
support a perverse incentive to lower the number of offerings 
to make sure we are in compliance with the proposed fiscal 
rules.
    Second, districts will have to manage spending centrally to 
comply with the proposed regulations. This means that any 
decision that affects spending, which we know is virtually all 
decisions, will have to be vetted through the district finance 
office for compliance checks. This will affect everything from 
school hiring and purchasing to curriculum.
    In my State, we are working to return these decisions to 
the local level, to those who understand students' individual 
needs best. In fact, our State just approved a plan, a 
bipartisan committee and the State board approved a plan for 
the reorganization of Clark County School District, our largest 
school district in Las Vegas, which shifts the major 
decisionmaking around capital, human, financial, operations, 
and academic planning from the central service of the district 
to each school site.
    Third and finally, I am concerned about what the 
regulations do not say. For example, the rule does not define 
many important terms like what it means to distribute ``almost 
all'' of a district's money to schools, or what it means to 
have a ``high proportion'' of disadvantaged students in a non-
Title I school to qualify for one of the exceptions.
    Importantly, the rule does not address what State education 
agencies should do if there is noncompliance. While these seem 
like technical issues, they will have a significant impact on 
my State's investments in an effort to promote equitable 
opportunities for all kids.
    I care deeply about equity. I am working closely with my 
Governor and my State legislature to promote greater equity and 
achievement for all kids in my State. We have made great 
strides to create a more equitable education system, and I urge 
the department to reconsider its proposed rule to interpret 
supplement not supplant in a way that is both consistent with 
the spirit of the Every Student Succeeds Act and promotes 
equity.
    Thank you, sir, for the time.
    [The statement of Mr. Canavero follows:]
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    Chairman Rokita. Thank you, Doctor. Mr. Owens, you are 
recognized for five minutes.

   TESTIMONY OF RYAN OWENS, EXECUTIVE DIRECTOR, COOPERATIVE 
           COUNCIL FOR OKLAHOMA SCHOOL ADMINISTRATION

    Mr. Owens. Good morning, Chairman Rokita, Chairman Kline, 
Ranking Member Fudge, and Ranking Member Scott, and honorable 
members of this committee.
    My name is Ryan Owens, and I am the executive director of 
the Cooperative Council for Oklahoma School Administration. 
Thank you for the opportunity to be here today. CCOSA 
represents all of Oklahoma's public, private, and charter 
school administrators. With more than 2,700 members actively 
serving almost 700,000 students, we work each day to give voice 
to the issues impacting educational attainment in the Sooner 
State.
    In the interest of brevity, I am not going to detail the 
specifics of the proposed regulations. I am going to focus my 
comments on the realities that school districts and 
superintendents will face in implementing the proposed rule, 
and what it could mean for the students they serve.
    Over 66 percent of school sites in Oklahoma qualify as 
Title I. Superintendents in Oklahoma and across the Nation are 
acutely aware of the consequences of inequitable resource 
allocation. Prescriptive regulations like these are not the 
solution. These regulations create new administrative burdens 
and encourage compliance-driven decisionmaking, which robs 
communities of their ability to govern their local schools.
    It would be far more helpful for the department to issue 
technical assistance that instructs States and districts about 
how to achieve the goal of equitable distribution of resources.
    In seeking to equalize State and local spending among 
schools, the proposed regulations, while noble in their goal, 
reach far beyond the intent of ESSA, which merely requires LEAs 
to demonstrate that Title I schools receive at least as much 
State and local funds as they would otherwise receive if they 
were not a Title I school.
    Currently, in Oklahoma, site level administrators are given 
the flexibility to assess student needs and determine the 
amount of resources necessary to facilitate instruction. Under 
the proposed regulation, district administration will have to 
override school level decisions to ensure balanced resource 
allocation between Title I and non-Title I schools without 
regard to how those resources are used to benefit children.
    The proposed rule is focused on teacher salaries as part of 
the calculation for equitable resource allocation among Title I 
and non-Title I schools. Destroying stability within classrooms 
and among schools is a major concern as last-minute movement of 
staff and other resources is likely in districts with multiple 
sites.
    Due to our State's budget crisis, Oklahoma schools have 
eliminated over 1,500 teaching positions and we still have over 
500 vacancies systemwide. How will Oklahoma districts using 
long-term substitutes and larger class sizes satisfy a 
requirement for equalized spending when the resource to be 
measured, teachers, does not exist?
    If the proposed rule becomes law, cost variability with 
enrichment programs will no longer be tolerable due to the need 
for uniform spending among Title I and non-Title I schools. For 
example, John Marshall Mid-High School in Oklahoma City Public 
Schools, a Title I school, offers students the opportunity to 
participate in a Finance Academy where they learn about the 
finance industry and work with university accounting students 
to file income tax statements at no cost for eligible 
Oklahomans. This is the type of specialized program at risk 
under the proposed rule.
    Another concern is enforcement of the proposed rule, and 
what will happen to districts if they fall out of compliance.
    The proposed regulation is silent about the meaning of key 
terms, as was mentioned. We are all left confused about what it 
means to allocate ``almost all'' of State and local funds to 
school sites. The lack of clarity and the meaning of key terms 
in the proposed rule increases the risk of uneven enforcement.
    Recently, in Oklahoma, in one school, there was a 
profoundly disabled student that was required to be served out 
of State. The annual cost for these services exceeded $250,000. 
Would these costs be included in a compliance calculation for 
equitable fund distribution and, if so, how would a district 
equalize the effect of such allocation?
    Will local bond levies or maintenance of the physical plant 
be included in these cost calculations and, if so, will the 
proposed rule seek to override the decision of local voters by 
equalizing construction and improvement among Title I and non-
Title I schools?
    The proposed rule could undermine local support for future 
bond issues as it could get harder to pass bond issues in 
compliance with the rule.
    ESSA recognized that those closest to students and schools 
had the best hope for improving learning conditions. The 
regulations proposed by the department take away the very 
flexibility ESSA guarantees.
    I respectfully ask that the department revisit the proposed 
regulations and require of schools only what ESSA demands, 
which is to demonstrate that Title I schools receive as much 
State and local funds as they would otherwise receive if they 
did not participate in Title I.
    Thank you, Mr. Chairman.
    [The statement of Mr. Owens follows:]
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    Chairman Rokita. Thank you, Mr. Owens. Mr. Sargrad, you are 
recognized for five minutes.

 TESTIMONY OF SCOTT SARGRAD, MANAGING DIRECTOR, K-12 EDUCATION 
              POLICY, CENTER FOR AMERICAN PROGRESS

    Mr. Sargrad. Thank you, Chairman Rokita, Chairman Kline, 
Ranking Member Fudge, and Ranking Member Scott for the 
opportunity to speak here today on the supplement not supplant 
provision in the Every Student Succeeds Act.
    And I just want to note that I bring here today my 
perspective as a former teacher and special ed aide as well. 
That is how I started my career in education, and that is 
something I bring with me wherever I go.
    As you all know, in 1965, Congress designed Title I of the 
Elementary and Secondary Education Act to provide additional 
resources to disadvantaged students in poor schools. Within 
years, it was clear that poor students did not receive their 
fair share of resources.
    To address this inequity, Congress soon after approved the 
first supplement not supplant provision to ensure that 
districts did not use Federal money to replace State and local 
dollars.
    On September 6 of this year, the Department of Education 
issued draft regulations on ESSA's updated supplement not 
supplant provision taking another important step towards 
fulfilling the law's requirements.
    But before I dive into the research and policy, I just want 
to step back and note that we are not considering here just dry 
academic questions. Even as we sit here today, in too many 
schools across the country, too many low-income students are in 
crumbling schools without access to effective and experienced 
teachers. They do not have rigorous courses. They do not have 
the wrap around services that they need to be successful.
    In fact, just two weeks ago in Baltimore, on a hot 
September day, every school closed early because those schools 
did not have air conditioning and those students lost valuable 
learning time.
    As Ranking Member Fudge said earlier, money matters in 
education. It matters particularly for students from low-income 
families. This is common sense, and it is supported by a 
growing body of research.
    For low-income students, a 10 percent increase in spending 
increased adult wages by nearly 10 percent. Another study found 
that greater State spending on low-income students dramatically 
improved student learning in both reading and in math. Students 
in poorer schools, however, continue to receive less than their 
richer peers.
    The Department of Education found in approximately 1,500 
school districts across the country, about 5,700 schools 
receive on average $440,000 less per year than wealthier 
schools in the same district. That is a lot of money, $440,000 
could let a school hire 8 new guidance counselors, it could 
give a $10,000 bonus to 40 teachers.
    This inequity also happens across districts, and while 
there is significant variation between States, high poverty 
districts on average spend 15 percent less per pupil than low 
poverty districts.
    In Pennsylvania, where I grew up, poorer school districts 
spent 33 percent less per pupil than wealthier districts in the 
State.
    As a result of these policies, children of color often 
suffer the most. Compared to high poverty and high minority 
schools,w wealthier and low minority schools offer more 
rigorous core programs. Wealthier schools are twice as likely 
to offer a full range of math and science courses, they offer 
three times as many AP courses, and they are twice as likely to 
offer dual enrollment opportunities.
    But again, these are not just facts and figures. Every day 
real kids walk into real schools with so few resources that 
every single one of us would find them unacceptable for our own 
child.
    In one Detroit elementary and middle school, black mold 
covers the gym floor and ceilings are full of exposed wires. In 
the William Penn School District, just down the road from where 
I grew up, students like Jameria Miller ``race to class to get 
the best blankets'' because they needed to stay warm since the 
school's metal walls have no insulation.
    From the passage of the original ESEA in 1965, the Federal 
Government's role has been to protect historically 
disadvantaged students and ensure they have the same 
opportunities as their more advantaged peers. Beginning with 
the original supplement not supplant provision, the Federal 
Government has had a responsibility to enforce this requirement 
of the law, and today's ESSA is no different.
    Districts have historically shown compliance with the 
supplement not supplant requirement by ensuring that every 
service purchased with Title I funds was ``supplemental'' and 
would not have been provided otherwise, and this meant that 
districts often limited their spending to programs they could 
easily show were supplemental and not necessarily programs that 
were the most impactful, and Congress rightly with the new law 
stopped that shortsighted practice. They did not make districts 
justify every purchase.
    Now instead, districts must demonstrate that their methods 
of funding make sure that poorer schools get their fair share.
    Recognizing that these historical funding inequities are a 
problem without an easy solution, the new regulation provides 
multiple options for districts to demonstrate compliance, and 
States can develop their own compliance tests.
    There is additional flexibility for schools serving lots of 
students with disabilities, lots of English learners, districts 
with small schools or schools with a single grade span. And 
there is plenty of time to comply.
    While this change will require extra efforts from school 
districts, it does not mean that they will have to use 
completely new strategies to distribute their school funding. 
Ninety percent of districts will already be in compliance. That 
does not mean we can rest on our laurels. Those 10 percent of 
districts have to do the hard work to show they are fairly 
supporting low-income schools, and they have to do that with 
State and local funds before the Federal dollars, but this hard 
work is worth it.
    We know these funding inequities remain. We know that money 
matters, and the department's regulations give flexible options 
and time to comply so that districts can be thoughtful about 
investing as part of their broader plan to support students in 
need.
    Thank you again for the opportunity to be here today.
    [The statement of Mr. Sargrad follows:]
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    Chairman Rokita. Thank you. Dr. Gordon, you are recognized 
for five minutes.

 TESTIMONY OF NORA GORDON, ASSOCIATE PROFESSOR, McCOURT SCHOOL 
     OF PUBLIC POLICY, GEORGETOWN UNIVERSITY, AND RESEARCH 
        ASSOCIATE, NATIONAL BUREAU OF ECONOMIC RESEARCH

    Ms. Gordon. Chairman Kline, Chairman Rokita, Ranking Member 
Fudge, and members of the subcommittee, thank you for the 
opportunity to testify today.
    For decades, compliance with supplement not supplant was 
tested by looking at each individual Title I expenditure. When 
this rule was in place, in 2014, in the course of my academic 
research, I interviewed district Title I managers across four 
States and found that compliance, not the effective use of 
funds, was their central concern. But despite their concern and 
attention to compliance, administrators were confused about 
what was and was not legal. What districts did understand was 
that Title I should only support extra things that were 
different from the core curriculum.
    This led to districts purchasing staff or services with 
Title I that were often unaligned with a core curriculum 
because they were easy to audit under the old rule rather than 
because of student needs.
    Meanwhile, research suggests that effective school 
improvement requires comprehensive strategies and alignment to 
good curriculum, not an assortment of add-ons.
    The problems with the old supplement not supplant rule have 
been around and documented by researchers since the 1970s. When 
it looked like reauthorization of ESSA might be possible in 
2012, the left-leaning Center for American Progress, Mr. 
Sargrad's organization, and the right-leaning American 
Enterprise Institute jointly published recommendations 
describing how supplement not supplant should be fixed.
    CAP and AEI stated that the test currently in use should be 
replaced, and I quote, ``with a simpler, more objective test, 
specifically: if districts can document that the manner in 
which they allocate state and local resources to schools is 
``Title I neutral,'' they should be clear of suspicion around 
supplanting of nonfederal funds with Title I dollars.''
    ESSA's new supplement not supplant test follows those 
recommendation and transforms what was already an option for 
schoolwide programs under No Child Left Behind and makes it the 
compliance standard for all Title I schools.
    As Ranking Member Fudge noted, ESSA absolutely does not 
waive the requirement to supplement not supplant. It is just 
the opposite; that language in the statute itself contains a 
compliance standard which could set an auditable test for 
supplement not supplant.
    The standard as presented in plain language, which may 
contribute to very common misperceptions that the law has no 
test and without regulation supplement not supplant, cannot be 
enforced. In short, districts have to explain how they are 
funding their schools and show that this method ensures that 
each Title I school receives all of the State and local funds 
it would have if it did not participate in Title I.
    In July 2015, the department itself explained how a 
district could pass such a test for its schoolwide schools. The 
language of ESSA simply expands the schoolwide approach to 
supplement not supplant under No Child Left Behind to all Title 
I schools.
    The department's proposed rule takes an entirely different 
approach to supplement not supplant than the statute's language 
or the department's own previous guidance on the topic. It 
mandates that Title I schools get a certain baseline of State 
and local funds measured in dollars. This approach essentially 
requires ad hoc adjustments in school level resources instead 
of a consistent and transparent allocation methodology.
    The goal of greater equity here is critical. Mr. Sargrad's 
testimony highlights how high the stakes are on getting equity 
right, but the department's approach does not get it right. It 
has major potential negative policy and practical implications, 
including districts needing to cut entire programs, like music, 
art, or PE, in order to get the money they need to make the 
numbers come out right; putting more expensive but less 
effective teachers into Title I schools; the potential to 
reduce local support for public schools and the taxes that 
support them; the possible loss of State and local funds for 
low-income schools that do not participate in Title I, and 
there are many of these schools.
    I just want to briefly turn to the cost-benefit analysis 
the department has offered and state this is a superficial 
analysis, and the data it is based on are not reliable. The 
department does not know and cannot know how districts will 
respond to the rule. This is the whole issue, how will 
districts respond, and that is what will determine the cost and 
the benefits to students.
    ESSA also contains a critically important new reporting 
provision that requires districts to report per pupil spending 
data at the school level. This will result in much greater 
transparency, but it will take time to implement.
    The department should help districts develop good 
transparent systems that generate reliable spending information 
rather than proposing a complicated rule that could hurt the 
very students it aims to help.
    [The statement of Ms. Gordon follows:]
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    Chairman Rokita. Thank you very much. I am going to 
recognize myself for 5 minutes of questioning. I find it very 
interesting, Dr. Gordon, that not only is the department going 
in a completely opposite direction of what Congress intended in 
this bipartisan law, but what you are saying is it is going 
against its own guidance previously issued. Is that right?
    Ms. Gordon. It is changing the direction. It is much more 
specific than its previous guidance.
    Chairman Rokita. Right. I want to focus also on this issue 
of congressional intent, Dr. Gordon. Your testimony highlighted 
this 2012 recommendation by the Center for American Progress 
and the American Enterprise Institute.
    The recommendation, which is quoted up on the screen here 
on the slide, was to simplify the long-standing supplement not 
supplant provision so that school districts would only have to 
show the State and local funding allocations to schools are, 
quote ``Title I neutral,'' unquote.
    You mentioned in your testimony that the gentleman sitting 
to your right is from the Center for American Progress.
    It seems to me that this report, this idea, from a left 
leaning group, organization, and a right leaning group actually 
is what we did in the law. Is that correct, Title I neutral?
    Ms. Gordon. Yes.
    Chairman Rokita. Due to the reforms adopted by Congress 
last year, specifically in Section 1118, the law now includes 
this recommendation, again, shown on the screen, to ensure 
States allocate funding in a Title I neutral manner. Is that 
correct?
    This recommendation that we are showing on the screen is 
what you believe to be what we wrote into the law and signed by 
the President?
    Ms. Gordon. Yes.
    Chairman Rokita. Now, is it true that the identical 
language originated in the bipartisan proposal that was 
negotiated by Senator Alexander and Senator Murray? Did you 
follow those negotiations?
    Ms. Gordon. Yes.
    Chairman Rokita. And is this the same thing?
    Ms. Gordon. Yes.
    Chairman Rokita. In fact, as you point out in your 
testimony, the bipartisan committee report for the Senate bill, 
now showing that on the screen, explains the congressional 
intent for this language. Are you familiar with this language? 
Is this what we . . . ?
    Ms. Gordon. Yes.
    Chairman Rokita. Alright. It is certainly what I remember. 
Dr. Gordon, given the clear legislative history behind this 
provision and the unambiguous bipartisan explanation of the 
provision contained in the Senate committee report, is there 
any conceivable honest way to argue that Congress intended this 
provision to be implemented in the way that the department is 
now proposing?
    Ms. Gordon. Not that I can imagine, no.
    Chairman Rokita. That was the question. Thank you very 
much. I appreciate that. Dr. Canavero, do you have anything to 
add to this discussion we are having, this line of questioning?
    Mr. Canavero. Chairman Rokita, I do not have anything to 
add. I will just say obviously we are supportive of the 
language that is the law. We believe that is a fair test for 
demonstrating compliance for Title I, and we applaud the 
changes in ESSA that allow a more schoolwide determination as 
opposed to the classic and historic compliance-based 
expenditure test that we have been working under so far.
    Chairman Rokita. Well, I thank you for being for it. We all 
have been for it. We all voted for this thing. The only ones 
that do not seem to be for it now is the department, which 
again is why we are here.
    Mr. Owens, do you have anything to add?
    Mr. Owens. Thank you, Mr. Chairman. I think again the test 
that is created in statute is the one that should drive the 
work of the department, which is very clearly whether the Title 
I schools receive all the State and local funds to which they 
were entitled, which is far and away very different than trying 
to look at an equalization of expenditures of State and local 
resources.
    Chairman Rokita. Thank you. And I will yield back and 
recognize the chairman of the full committee, Mr. Scott, for 5 
minutes.
    Mr. Scott. Thank you, Mr. Chairman.
    Chairman Rokita. Long time before you retire. Mandy days. 
Excuse me, the ranking member of the full committee, Mr. Scott.
    Mr. Scott. There is no objection.
    Chairman Rokita. The gentleman did not notice.
    Mr. Scott. It just came so naturally, I did not notice. 
Thank you, Mr. Chairman. Mr. Sargrad, when you talk about to 
which entitled, is it not a fact that schools attended by low-
income students are chronically underfunded?
    Mr. Sargrad. Yes, that is right.
    Mr. Scott. When we wrote the law, is there any question 
that we intended a change in the way it would be calculated, 
that is to say we required new rulemaking to make sure we had a 
new standard?
    Mr. Sargrad. Yes, that is very clear.
    Mr. Scott. How did you interpret the effect of that new 
standard?
    Mr. Sargrad. That it moved from an activities and services 
based test to a funds based test, to ensure that schools 
received all the funds they are entitled to.
    Mr. Scott. And how low can you get in terms of underfunding 
before you get out of compliance, according to the old 
standard?
    Mr. Sargrad. There is no limit, you could be significantly 
underfunded.
    Mr. Scott. You mentioned a lot of district to district 
comparisons, what about within the district comparisons? Are 
there districts that have students going to low-income schools 
receiving significantly less per student than those going 
across town within the same district?
    Mr. Sargrad. Yes, there are significant gaps in many 
districts.
    Mr. Scott. How does the new standard deal with that?
    Mr. Sargrad. It simply ensures that the Title I schools 
receive the State and local funds that they are entitled to.
    Mr. Scott. And that would mean that they would receive the 
funds and then the Title I funds would be on top of that, would 
supplemental to what they should have gotten in the first 
place?
    Mr. Sargrad. That is right.
    Mr. Scott. Mr. Canavero, you indicated that the financial 
standard by itself is too narrow. Is that right? You ought to 
consider other activities like AP courses, CTE courses, arts, 
effective teachers, things like that ought to part of the 
calculation?
    Mr. Canavero. Correct, sir.
    Mr. Scott. Does that mean total dollars spent, should you 
not at least have the money equal before you get into the other 
activities? If you ought to consider other things, ought not 
the money get straight before you go to the other activities?
    Mr. Canavero. Certainly, sir. The notion of providing these 
opportunities to all students is critical.
    Mr. Scott. Within the district, are there disparities in 
terms of funding before you get to the Title I funds?
    Mr. Canavero. Are you asking specifically what the district 
within Nevada or general?
    Mr. Scott. Within school districts. Are there school 
districts that before you get to the Title I money fund schools 
attended by low-income students, are they getting more or less 
generally than those attended by high-income students?
    Mr. Canavero. The only detailed knowledge I have is within 
my State, and generally speaking, they are all funded equally.
    Mr. Scott. All of the Title I schools get equal funding 
before you get to the Title I funding?
    Mr. Canavero. That is correct, sir, and there are obviously 
some nuisances related to cost of teachers within those 
programs or as I mentioned in my testimony, the creation of 
choice based programs that are meant to break down historic 
enrollment patterns, related magnet schools in particular, 
signature academies, whatever you want to call them.
    Mr. Scott. Does the teacher calculation reflect the fact 
that traditionally more effective teachers tend to teach at the 
schools attended by high-income students rather than low-income 
students, and so the payroll at schools attended by high-income 
students would be higher than those attended by low-income 
students?
    Mr. Canavero. Historically, the discussion has not been 
around effectiveness and pay, it has been around tenure and 
pay, the longer they have been in service. What we find in 
Nevada in particular is that under a significant shortage of 
teachers, those shortages, however, are not equally spread. We 
found that they are disproportionately spread with some hard to 
fill schools such as those with students in poverty and 
communities in poverty.
    Mr. Scott. And so the payroll at the low-income school will 
be significantly lower than that at a high-income school?
    Mr. Canavero. It may be.
    Mr. Scott. Generally speaking.
    Mr. Canavero. Yes.
    Mr. Scott. Thank you, Mr. Chairman. I yield back.
    Chairman Rokita. I thank the gentleman. Now, let me take 
this opportunity in high honor to introduce the chairman of the 
full committee, a great American, and most importantly, a 
benevolent and forgiving leader, Mr. Kline, for 5 minutes.
    Chairman Kline. Clinging fearlessly to my job and title for 
a few more weeks, I thank the chairman.
    The discussion here fundamentally is about what happens 
when the Congress takes a bill, works it through, passes it, 
the President signs it into law, and you have a new law, and an 
administration, any administration, then goes through the 
regulatory process and starts to promulgate regulations to 
allow for the implementation of that law.
    The issue is that the administration, any administration, 
is not allowed to decide what parts of the law it wants to 
enforce and what parts it wants to change and what parts it 
wants to leave out. The administration is not allowed to 
rewrite law.
    And so, there are some of us who feel like that is in fact 
what is happening here with this administration and this 
Secretary's implementation of the Every Student Succeeds Act.
    So, Dr. Gordon, I want to come back to you and go through a 
pretty step by step series of questions and answers so this 
will be perfectly clear, at least to me and you. I am going to 
go down the same line that Chairman Rokita was taking up in his 
questions.
    So, Dr. Gordon, the Center for American Progress and the 
American Enterprise Institute had a specific proposal 
addressing supplement not supplant, and that proposal was 
adopted by Congress. Is that correct?
    Ms. Gordon. Yes.
    Chairman Kline. And these two organizations also 
recommended Congress address actual per pupil spending of State 
and local funds through the law's comparability provision. Is 
that correct?
    Ms. Gordon. The Center for American Progress did, yes.
    Chairman Kline. Right. Okay, right. Does the department's 
regulatory proposal that we are discussing today reflect the 
goal behind that proposal?
    Ms. Gordon. The comparability proposal?
    Chairman Kline. Yes.
    Ms. Gordon. Yes.
    Chairman Kline. But did Congress change comparability or 
any other provision in any way consistent with that proposal?
    Ms. Gordon. No.
    Chairman Kline. No, that is right. In fact, in the Senate, 
Senator Bennet offered a specific amendment on comparability 
that reflected the goals of the organizations' proposal. Did 
the Senate adopt the Bennet amendment?
    Ms. Gordon. No.
    Chairman Kline. No. In the House, our colleague, the 
ranking member of this subcommittee, also offered an amendment 
with similar goals. Did the House adopt the Fudge amendment?
    Ms. Gordon. No.
    Chairman Kline. No. So Congress explicitly rejected 
proposals to address actual per pupil spending in the law, but 
did adopt the AEI/CAP recommendation to make this information 
transparent, right?
    Ms. Gordon. It adopted the CAP/AEI recommendation about 
having a methodology based test of supplement, not supplant.
    Chairman Kline. Thank you. I probably had too many words in 
my question. Thank you. So, to summarize, Congress was aware of 
recommendations to address actual per pupil spending, as we 
just noted, in both the House and Senate, but on multiple 
occasions, flatly rejected this idea selecting instead to 
require States and school districts make per pupil spending 
public, yet here we are today examining a regulatory scheme put 
forth by this administration that Congress explicitly rejected, 
and that I believe will wreak havoc on communities across the 
country.
    So, Dr. Gordon, again, staying with you, is there any 
conceivable way to interpret the law's supplement not supplant 
or comparability provisions as requiring any form of equalized 
spending between Title I and non-Title I schools?
    Ms. Gordon. No.
    Chairman Kline. Exactly. Thank you very much. I yield back.
    Chairman Rokita. I thank the gentleman. Ms. Clark, you are 
recognized for 5 minutes.
    Mrs. Clark. Thank you, Chairman Rokita, and Ranking Member 
Fudge, and to all the panelists for being here today.
    First, I want to give Mr. Sargrad a chance to respond to 
the line of questioning we have had for Dr. Gordon. If you 
could tell us about CAP's role in this definition and how you 
see the implementation of the current supplement but not 
supplant rolling out, and is it in line with your research?
    Mr. Sargrad. Thank you, yes. So there are a couple of 
things that I would want to say to this, the first is that just 
like in the law, Congress decided to change to a funds based 
supplement not supplant test but did not go into specific 
details about how the department might enforce that requirement 
and how precisely districts would comply, our recommendation 
also was a policy recommendation that I think we anticipated, 
although I was not at the Center for American Progress in 
2012--we anticipated an administration would need to go through 
rulemaking to interpret and to make sure atthe districts were 
complying.
    The second point that I would make is that the 
recommendation around distribution of funds being Title I 
neutral, is that if that method results in shortchanging Title 
I schools, it seems pretty clear that is not Title I neutral, 
and so that is a key piece of the recommendation and a key 
piece of how we believe the law should be implemented.
    Mrs. Clark. Thank you. I wanted to follow up also with Dr. 
Canavero. In your testimony, you stated that, quote ``One of 
the most important aspects of the ESSA is its focus on 
equity,'' and I could not agree more. And you have set forth 
some of your victory schools program where I believe the State 
of Nevada put 25 million dollars into low-income schools, as 
you described different programs, social workers, arts, other 
programs that you felt were necessary.
    But absent from your list of your State's ongoing effort to 
implement is your State's effort to implement the most 
expansive private school tuition tax credit in the Nation, one 
that gives 51 hundred dollars to private school tuition 
regardless of family income. This in a state where you are the 
seventh highest percentage of children living in poverty in 
Nevada, and at least according to the Ed Week report card, the 
lowest ranking school system in the country.
    I am curious, how do using these public funds intended for 
public education, as we are here talking about how we can best 
serve our lowest income students, how does that further your 
State's focus on educational equity?
    Mr. Canavero. Thank you for the opportunity to respond, 
Representative Clark. So that is obviously a legislative 
directive from the State legislature that is presently tied up 
in the courts. And so, to the extent that I can control the 
legislature, which I cannot, that is what it is.
    I can tell you definitively that in a State with a 
Republican Governor and a Republican controlled legislature, in 
2015 to raise taxes to fund education, acknowledging the need 
in our State, the undeniable need in our State to improve 
outcomes for students, given all that you have just suggested 
and more, fundamentally reflects, I think, the general 
commitment of our State and our leadership in our State to 
making things work, and to become, I think, at the end of the 
day the fastest improving State in this Nation.
    We recognize the challenges before us and we placed major 
investments down to remediate those efforts.
    There are a number of other . . .
    Mrs. Clark. Is it not true, Dr. Canavero, that the Nevada 
State Treasurer has estimated that this program if fully 
implemented, and at this point 80 percent of the applicants for 
this tax credit are higher income, only 11 percent are in your 
40th or below in income levels, so only 11 percent really 
beginning to touch the bottom 40th of earners, that could 
divert up to $200 million from public schools.
    Do you think there is a feeling in Nevada, in the State 
legislature, that equal amounts of tax credit builds equity 
into the system?
    Mr. Canavero. I think that is a question that the 
legislature and individual legislators could answer. It is not 
within the Department of Education, as you recognize. It is 
within the Treasurer. To the extent it is implemented, it is 
implemented, and obviously, I follow the State's laws.
    Mrs. Clark. Thank you. I yield back.
    Chairman Rokita. I thank the gentlelady. Mr. Thompson, you 
are recognized for 5 minutes.
    Mr. Thompson. Chairman, thank you. Thank you for members of 
the panel for being here on this important topic.
    Let me bring our discussion right back to where it is 
supposed to be, on the United States Department of Education, 
and quite frankly, the intent of Congress. Because that is the 
friction point we have at this point. My question I will open-
up to all.
    Most of you have talked to some extent about the potential 
impact on special programs, things like career and technical 
education, magnet schools, art programs, physical education 
mentioned. I am sure there may be others. Be curious to hear 
what others you have concerns about with how the department is 
moving ahead contrary to the intent of Congress.
    Can you explain more about why these programs will be at 
risk and how those programs are addressing equity concerns? 
Let's start with Dr. Canavero, please.
    Mr. Canavero. Certainly. Thank you, Representative 
Thompson. In my testimony, I did mention career and technical 
education, career and technical academies, magnet schools. 
These are not provisions within the exceptions that are 
currently listed within the regulations.
    My concerns are as follows: they are expensive. Magnet 
school programs are expensive. Career and technical academies 
are expensive. Career and technical education is expensive, and 
rightfully so given the infrastructure that needs to be built 
out in order to provide students the opportunity for either 
real world experience in a career/tech-ed or skill based work, 
or whether it is in a magnet school specifically focused on 
law, for example, or culinary.
    Magnet schools themselves, if my memory serves me 
correctly, began in the 1970s in response to there was a clear 
opportunity to increase or decrease segregation in our schools, 
and they provided an opportunity, open enrollment opportunity 
to students. Typically, they are theme based. An opportunity to 
enroll students outside of a traditional attendance boundary. 
That is indeed what we see across our State, is that there are-
they have waiting lists. We could do and obviously fill more.
    If we utilized the level funding test, in my testimony, my 
fear is that school districts will be incentivized to lower the 
offerings at magnet schools or career and technical education 
programming in order to equalize the funding across, even 
though those opportunities are made available to and many 
students participate in the magnet school and career/tech 
academies across our State from low-income.
    Mr. Thompson. Just to follow up on that, you mentioned the 
cost of career and technical education. Truly, if we are 
meeting market demands and we are educating, and my 
understanding was career and technical education, the dropout 
rate there is much lower than in traditional education 
settings, but there is a cost, if it is welding, medicine 
related, agriculture, machining.
    If those are where the costs occur obviously with this 
equalization that the Department of Education is trying to 
pursue, essentially if you do not have state-of-the-art 
equipment, you are not really preparing the students with the 
competencies to go right into the workforce. That is my 
concern. Is that accurate?
    Mr. Canavero. Representative Thompson, that is accurate, 
and that is the genesis really and the nature of my testimony. 
Again, reflecting absent additional dollars in the system, you 
would need to make decisions that may mean that you have to 
lower or reduce course offerings or reduce expansion of magnet 
programs or reduce career and technical academies or reduce 
career/tech ed in order to meet the fiscal test proposed.
    Mr. Thompson. Thank you. Mr. Owens, any thoughts/impacts on 
the types of programs we have been reflecting on?
    Mr. Owens. Thank you, Representative Thompson. I would just 
echo Dr. Canavero's statements regarding the career technical 
component. In Oklahoma, we have Statewide open enrollment, open 
transfer, so students can move freely between districts, when 
they get within the open enrollment process, to access the 
programs that are most beneficial to them and meeting their 
needs.
    So again, any of those programs that have cost variability 
components really become intolerable under a rule that really 
promotes uniformity of spending. So the example I cited in my 
testimony that the Financial Academy, at the Title I school, 
John Marshall Mid-High, has a banking center inside the school, 
it brings students from universities in to help Oklahomans do 
their taxes, those costs that you can't control at a district 
level become programs that have to be wiped away.
    Mr. Thompson. Thank you, Chairman. I yield back.
    Chairman Rokita. I thank the gentleman. Ms. Bonamici, you 
are recognized for 5 minutes.
    Ms. Bonamici. Thank you very much, Chairman Rokita and 
Ranking Member Fudge. Implementing the Every Student Succeeds 
Act is going to further the goals of equity, and I am glad that 
seems to be something everyone agrees on is going to help all 
of our children across the country, students of color, low-
income students, Native students, English learners, students 
with disabilities.
    And certainly the supplement not supplant requirement plays 
a critical role in achieving this goal. I know educators, 
parents, and students in high poverty schools are frequently 
shortchanged, and reports show that about 40 percent of Title I 
schools receive less personnel funding per pupil than non-Title 
I schools, and schools that serve almost entirely students of 
color receive about $700 less per student than schools that are 
predominantly white.
    There is a disparity that needs to be addressed, and it is 
especially troubling if we know that in some cases, it is not 
just equal funding that is equitable, the schools serving 
communities of concentrated poverty actually need additional 
resources and support. I think that is the goal.
    When Congress added this supplement not supplant 
requirement to ESSA back in 1970, I was not here then, but I 
think that was certainly the goal, so that those high needs 
schools would receive that additional support, and for decades 
Congress has stood by that principle.
    I am a former State legislator and I think many of us are, 
and understanding that need to send that message that these 
Federal dollars are not to replace your K-12 investment.
    We had a hearing in June, and Chairman Kline noted that the 
law, that ESSA, requires districts to show that funds are 
distributed fairly before they receive Title I dollars. And I 
do not think anyone disagrees with that, I mean that is 
certainly the intention here.
    And to uphold our intention, Congress expects the 
Department of Education to enforce the supplement not supplant 
requirement, so there need to be some clear standards. I do not 
think anyone would disagree with that.
    I wanted to ask you, Mr. Sargrad, one concern that we have 
heard is that this supplement not supplant requirement could 
force districts to reassign teachers in ways that may not be in 
the best interest of students. As the law supports a move to 
greater equity, I want to make sure it does not create undue 
disruption for hard working educators, and given your expertise 
as a teacher and an official responsible for overseeing Title 
I, how will States and districts be able to create greater 
parity in school funding while also minimizing that uncertainty 
for educators and making sure that school staffing decisions 
are really driven by the needs of the students.
    And if when you are discussing this, could you talk about 
the difference between like large urban districts. I have 25 
school districts in my congressional district, and they really 
differ. Some of them are very large and some of them are very 
small and rural. So would you talk about that as well, and how 
this might affect the difference between rural and urban 
schools, but really with a focus on whether this is going to 
create undue disruption for educators.
    Mr. Sargrad. Thank you, Representative Bonamici, I am happy 
to talk about that. I absolutely agree with a lot of what folks 
have said here today, that forcing transfers of teachers is a 
bad idea. It is bad practice and it is not a good idea for 
students and it is not a good idea for teachers.
    But this proposed regulation will not require districts to 
do that. There are multiple ways that districts can get 
additional resources to poor schools without moving teachers 
around. They could pay teachers more. They could provide 
incentives for teachers to teach in these hard to staff low-
income schools. They could invest in these schools in wrap 
around services and make sure every low-income school has a 
guidance counselor and a school nurse and librarian, which many 
of them do not. They could extend the school day or extend the 
school year in these schools to make sure students have enough 
time to learn what they need to learn to be prepared for 
college or for a career.
    And they can change their systems for funding, and they can 
move to things like weighted student funding formulas that 
provide additional resources for students with disabilities, 
low-income students, and English language learners.
    So there are lots of ways to get these resources to the 
low-income schools, and I think the proposed rule does give 
time for districts to figure this out, and they do not have to 
make decisions right away about how they are going to do this, 
but they can be thoughtful about how they are going to make 
sure these schools get the resources that they need.
    And I think to your question about the differences in 
districts, I think that is a really important point. And I 
think there are huge differences between a large urban district 
and a small rural district or a mid-sized suburban district, 
and they do have different options on how to comply with some 
of these requirements.
    And I think it is absolutely right there is not a single 
test here. I think the fact that there are multiple options and 
there is additional flexibility for specific unique 
circumstances, and that there is an option for States to be 
able to develop their own test here is very important.
    Ms. Bonamici. Thank you very much. I see my time has 
expired. Thank you, I yield back. Thank you, Mr. Chairman.
    Chairman Rokita. I thank the gentlelady. Mr. Grothman, you 
are recognized for 5 minutes.
    Mr. Grothman. Sure, Mr. Canavero, I have a couple of 
questions. But first, I would like to congratulate your State; 
I was not aware they had passed a program allowing poorer kids, 
all kids, to attend schools of their choice. There are so many 
backward looking people who hate these programs because they 
think that if they send their children to a private school, 
they should not have the school watered down with other kids. 
Maybe they do not want their children going to school with, and 
I think it took a lot of guts of your legislature to do that, 
so you can say I congratulate them for looking out for the 
kids.
    I used to be in the State legislature, and I understand the 
interplay between State and local authority. Your testimony 
discusses ambiguity for the States in balancing their Federal 
enforcement obligation with the realities of State and local 
laws that may limit a district's ability to comply or a State's 
ability to enforce compliance.
    Can you describe the kind of State and local laws you are 
talking about and how they might conflict with this rule, and 
can you describe the process that State and locals will have to 
undertake to come into compliance with the department's 
proposal?
    Mr. Canavero. Certainly, Representative. So there are a few 
examples here, one that I pull from my interactions with other 
chiefs and with the [l1]CCSSO, the Council of Chief State 
School Officers, relates to levies or bonds that are specific 
to providing and raised by a district for a specific activity 
or tied to a specific program.
    And, if in fact that bond issuance or that levy conflicts 
with the adjustment of resources that would be required under 
the regulations or otherwise directed differently, how the 
local system, how the local school district, would balance that 
tension between what the levy requires or what that bond 
commitment requires as acted on by the voters versus how to 
remain compliant with the Federal rules. So that would be one.
    The other maybe specific to Nevada is related to--it is 
part of the ambiguity that we seek to get clear on, is related 
to State initiatives around investments in schools, and what 
that would translate to for a local education agency or a 
school district in identifying their weights in compliance with 
this particular provision.
    So there would be some tension there specifically the laws, 
that is something we continue to review, as a chief in my 
State, we continue to review, but knowing again from a national 
discussion, there is some concern related to the ability for 
districts to both fulfill the obligations of a levy or a bond 
issuance and be compliant.
    Mr. Grothman. Okay. I have a question. Does this 
requirement apply not only within a district but to a State as 
a whole?
    Mr. Canavero. My review of the regulations requires the 
LEA, the district, to be compliant. Obviously, there is a State 
role to be played here. You heard earlier the role that a State 
could play which is to create its own algorithm.
    Mr. Grothman. I'll give you a question. They only give us 5 
minutes. One of the things that surprises me, at least in 
Wisconsin, maybe Wisconsin is an anomaly, I do not think there 
are significant differences at all from school to school within 
a district.
    There are differences in spending between districts, but I 
would think for an average district, if they have 5 or 10 
elementary schools, they probably all get almost identical 
amounts of money. Is that the norm, or are there districts 
around the country - I will ask any of you in which- really, 
within the same district, different elementary schools are 
getting wildly different amounts of money?
    Mr. Sargrad. I would say that this is part the key piece of 
this supplement not supplant provision, and the department's 
regulation, that in 90 percent of districts, this is probably 
not an issue, but in 10 percent of districts, there are 
significant differences between low-income and high-income 
schools, and for those students, those differences really 
matter.
    Ms. Gordon. I could just add to that, the districts where 
there are differences, it may not be apparent because they may 
have similar staffing, so you may see schools within a district 
that all have relatively similar teacher/people ratios, and 
what is driving the differences is largely the teacher 
salaries.
    Mr. Grothman. Would it not sometimes be inadvertent? I can 
imagine the districts I have, usually the longer you teach, the 
higher your salary goes, so just by chance one district may 
have teachers averaging $60,000 a year and the other $45,000, 
and it really does not have anything to do with quality. Is 
that true?
    Ms. Gordon. Yes, that is what is driving the difference, 
pay scale.
    Mr. Grothman. Seems to be a lot of paperwork, too. I would 
be surprised if districts that I am aware of even know if there 
is a difference in costs from school to school. I do not know 
if they even break things down that way.
    Ms. Gordon. Many districts do not have dollars at the 
school level.
    Chairman Rokita. The gentleman's time has expired. I thank 
the gentleman. Mr. Polis, you are recognized for 5 minutes.
    Mr. Polis. Thank you, Mr. Chairman. I want to thank the 
witnesses for being today, and Ranking Member Fudge and 
Chairman Rokita. Last fall, I had the opportunity to be on the 
conference committee to reauthorize ESEA, and when we were in 
our final negotiations, one theme remained consistent: ESEA is 
a civil rights law first and foremost; it was created with the 
idea that all students regardless of where they come from, 
their race or ethnicity, deserve a fair shot.
    And the issue we are discussing today really goes to the 
core of ESEA's role in fulfilling that mission. And I think it 
is important that the discussion today is around making sure 
that the money provided in ESEA for the neediest schools 
actually gets to these schools.
    I briefly wanted to address the quote that Chairman Rokita 
put on the wall regarding a congressional prohibition around a 
specific methodology. Now, you know, I am not an attorney but 
the simple read of the congressional intent there is a specific 
methodology is prohibited, not several particular approaches 
that are dictated, not several specific or parameters.
    If Congress had not wanted the department to give several 
possible approaches, the prohibition would have been against 
guidelines at all being issued, against several different 
approaches being outlined.
    But the particular bar is a specific methodology, and of 
course, there is not a specific methodology in the department's 
proposed regs. There are in fact several very contrary to the 
word ``a'' proposed approaches.
    I also wanted to follow up on Mr. Thompson's question to 
Dr. Canavero. I join Mr. Thompson in being a big fan of 
vocational and career programs. I wanted to ask Dr. Canavero if 
he is aware in Nevada of instances of Title I funds being used 
for some of the things Mr. Thompson mentioned, like for 
instance, the physical equipment for welding programs or shop 
programs.
    Mr. Canavero. Thank you, Representative Polis. I am not.
    Mr. Polis. Reclaiming my time, the point being made is that 
would be an unusual, perhaps not explicitly prohibited use of 
funds, but in general, to the extent Title I funds are used for 
equipment, it is equipment for Title I programs, it would not 
be used for-really ever-it would be very difficult to use for 
welding programs-oh, I see Mr. Thompson has left- or for other 
types of programs.
    The point being that of course we recognize the need for 
the physical investment in vocational and career education 
programs. I would also point out that in many cases this is 
done in partnership with those who already have that equipment. 
That is kind of the new way of doing that, community colleges 
and others that have that equipment.
    It is rare, not unheard of, for school districts to have to 
purchase this equipment themselves these days, but of course, 
it would be even rarer still for any Title I funds to be used 
for that, almost impossible under previous guidelines and 
current guidelines. I did want to point that out.
    I wanted to go to Mr. Sargrad for a question. In your 
testimony you mentioned that 90 percent of school districts 
already meet the requirements under the proposed supplement not 
supplant. Now, we have heard various instances of doom and 
gloom about the proposed regulations.
    For clarity, can you again explain how most school 
districts already comply with these proposed standards, and 
realistically, what do you think the effect of these 
regulations would be?
    Mr. Sargrad. Thank you, Representative Polis. So the 
department estimates, as you mentioned, that approximately 90 
percent of districts have no Title I schools that are receiving 
less than their non-Title I counterparts. And that means that 
in a small subset of districts and with a certain number of 
schools, this is a significant problem, and as I mentioned, the 
department also estimates that these differences are about 
$440,000 per school.
    But for the remainder of districts, they are already 
spending enough money in their non-Title I schools to meet this 
requirement, and combined with the flexibility that the 
regulation provides on a 5 percent buffer year to year on the 
spending, combined with flexibility for students with 
disabilities and English learners.
    Mr. Polis. Mr. Owens, it is my understanding your 
organization, and I do not know if you personally as well, but 
along with many State superintendent associations, are 
supportive of the department's 2015 guidance on schoolwide 
programs, and that guidance actually provides the same two 
examples the department has included in its regulation.
    The proposal also includes a State determined option for 
compliance, very similar to those 2015 guidance, and I was 
wondering why your organization or perhaps you can address it 
on a personal level as well, why you are supportive of those 
options in the 2015 guidance but not those same examples and 
options in the current proposed regulation.
    Mr. Owens. Thank you, Representative Polis. As I understand 
the 2015 guidance and regulations, it provides much more 
flexibility to my members to assess the needs of their students 
and deploy resources accordingly, which is not as - the 
flexibility is not as visible to us in the proposal today from 
the department in terms of the methodologies that would be 
prescribed for districts that result in uniform spending per 
student.
    Mr. Polis. Thank you.
    Chairman Rokita. Thank you. The gentleman's time has 
expired. I will now recognize Mr. Bishop for 5 minutes.
    Mr. Bishop. Thank you, Chairman Rokita. Thank you for this 
informative hearing today, and thank you to the panel for your 
testimony and your time, really appreciated it.
    I know a number of the members of this committee were State 
legislators, I have heard them indicate that, and I think we 
have all seen the heavy hand of the Federal Government as a 
State legislator. Many times these programs were forced down 
upon State legislatures, they call them ``incentives,'' but 
they are in the form of a mandate, many case, an unfunded 
mandate.
    As a State legislator, I knew how very damaging they were 
to what we were trying to do on behalf of our local school 
districts. I am also a parent, so I have three children in 
public schools today, and I am very concerned about the state 
of our public schools, and that is why I was very proud of what 
we did with the ESEA, which was a direct attempt at making sure 
we ended these failed top down policies, and we reduced the 
Federal rule, and really restored local control to K-12 
education, which was a bipartisan effort.
    It was the intent of Congress. I thought the law was clear 
and unambiguous. We made every effort to try to drill down and 
polish to ensure that there would be no questions as to 
interpretation, but of course, now we are seeing that.
    We had the director in several times expressing our 
concerns about implementation. And now we are faced with an 
implementation question. I am sure this is going to continue as 
time goes on.
    I have a question and I guess I do not know who to ask it 
to, and please feel free to weigh in if you would like to, but 
I would like to begin with Dr. Gordon, because I noticed in 
your bio you focus on fiscal federalism and American 
educational policy and the current historical Federal role in 
elementary and secondary education, which I think is specific 
to this question.
    The department has estimated that all but about 1,500 
school districts around the country will be in compliance with 
what they are calling the ``special rule.'' In your testimony, 
you questioned this data. How valid do you think the estimate 
is?
    Ms. Gordon. To clarify, that estimate comes from the 2013 
civil rights data collection, which is now publicly available 
for anyone who would like to try to replicate, and I have spent 
some time with preliminary estimates with these data.
    I do not question there would be about 1,500 districts who, 
if you believed those numbers, which is an issue because many 
school districts in that data collection are being asked to 
report spending at the school level in dollars, and they do not 
have the data infrastructure to generate those numbers, so they 
are reporting something, something that is measured with error, 
but if you take those data as a starting point, I think that is 
probably correct that you would find about 1,500 districts that 
are not in compliance.
    What I disagree with, there are not 90 percent of districts 
who are in compliance, rather the majority of that 90 percent, 
the rule does not apply to them because they are so small they 
do not have one Title I school and one non-Title I school 
within the same grade span, so it is not that most districts 
meet this rule. Rather, the rule does not apply to many 
districts.
    Mr. Bishop. Okay. But we agree that 1,500 is a good number 
in terms of those that are not in compliance?
    Ms. Gordon. Ballpark.
    Mr. Bishop. Okay. The department also estimates that this 
would cost about $800 million and $2.2 billion for those 1,500 
districts to come into compliance with the special rule. Again, 
how valid is that number?
    Ms. Gordon. I have not tried to replicate that number, but 
just to give some background on what I think is the methodology 
because they have not shared details of how they calculate that 
number, which you cannot replicate without knowing some of the 
assumptions, I think the lower number comes from assuming that 
you are just moving the money from non-Title I schools into 
non-Title I schools, and the higher number comes from assuming 
you are going to keep all Title I schools the same and level 
up.
    Mr. Bishop. In any case, the compliance number is 
astronomical, especially for a local school district who is 
already tied up and having difficulty making ends meet to begin 
with.
    Ms. Gordon. I think what should receive more attention, 
actually in the proposed rule they discuss how there are 500 
districts who are going to have greater costs, and it would be 
interesting to see their data on what the costs are going to be 
for those districts.
    Mr. Bishop. It is unfortunate because communities will be 
forced to relocate teachers, raise taxes or both, and America's 
poorest neighborhoods will probably be hit the hardest.
    Thank you. My time is up. I yield back.
    Chairman Rokita. I thank the gentleman for yielding. Ms. 
Adams, you are recognized for 5 minutes.
    Ms. Adams. Thank you, Mr. Chair, Ranking Member Fudge, and 
thank you to the panelists for your testimony.
    Mr. Sargrad, what in your estimation would happen without 
an enforceable standard for compliance with the supplement not 
supplement requirement that can be used by State auditors, and 
what happens if it is left completely open for interpretation?
    Mr. Sargrad. Thank you, Representative Adams. I think that 
is a great question. There are two things that I think could 
happen. One is that districts will continue to be confused by 
this requirement just as they have been in the past. I think 
you have heard from a number of us today that the old 
supplement not supplant requirement really did not serve kids 
well because districts were so concerned about these audit 
requirements and there was not clear guidance and there were 
not clear regulations on this.
    The second thing is that you could continue to see these 
inequities persist at the district level. As we have mentioned, 
this represents 1,500 districts, but there are a lot of 
students that there in those districts and a lot of students 
that this money could do real good for.
    And if the department cannot enforce this requirement and 
districts continue to perpetuate those inequities, those 
students are going to lose.
    Ms. Adams. Thank you. Dr. Canavero, the proposed rule 
simply asks each LEA to come up with an allocation formula for 
State and local funds, to apply that formula, and then to prove 
that the Title I schools within the district receive the 
funding they deserve under the LEA's own allocation formula.
    Can you help me understand why this is bad or an 
inequitable policy?
    Mr. Canavero. Certainly, thank you, Representative Adams. 
So number one, I do not think it is disputable, and I would 
suggest that I think Nevada has taken great strides to ensure 
that schools receive additional funds, in particular, schools 
serving communities in poverty, English language learners, 
insomuch as the State has passed additional funding for gifted 
and talented pupils, as well as special education, or students 
in special education.
    The challenge we have with the regulation or the issue I 
have with the regulation is trying to reconcile what it is 
suggesting and offering versus the path that the State is 
pursuing and the course that we have charted.
    The issues related to what I find to be ambiguous language 
about ``almost all'' and others related to the special rule or 
the exemptions that may or may not apply.
    In particular cases for me, when we look at funding English 
learners in non-Title I settings, which is as we work our way 
towards distributing the weight across more and more students 
as we invest as a State, what we find is that the English 
learners may be in concentrations of 30 percent at a non-Title 
I school, and it is unclear whether or not the additional 
expenses at that school within a district would have to come 
down if in fact the Title I school that does not receive the EL 
funding is not in locked step with that EL school.
    So just recognizing the auditing of this process as was 
mentioned earlier, I am having a tough time figuring out how I 
would advise my districts related to auditable standard, 
related to the language that, for example, high proportion or 
most, I believe, versus the auditable standard that would be 
applied to the language in the law, which is very similar to 
the auditable standard that was created under the schoolwide 
allocation for Title I schools, which is something districts 
are comfortable with, States know. That seems a little bit more 
predictable than the potential auditable standard that is 
created or not created under the regulations.
    Ms. Adams. Okay. Thank you. Mr. Owens, you argued that 
allowing district administrators to override school level 
decisions to ensure there is a balance. However, 
superintendents are tasked with overriding school level 
decisions all the time in order to balance competing demands 
and make sure that all children are served.
    So are there times when superintendent decisions should 
override school level decisionmaking?
    Mr. Owens. Thank you, Representative Adams. Certainly, the 
superintendent is the last voice for children at a school 
district, and if they ever exercise their authority to override 
a school level decision, it should be done based on the best 
interest of an individual child, not in an effort to be in 
compliance with a Federal regulation.
    Ms. Adams. Alright. Thank you very much. I yield back.
    Chairman Rokita. I thank the gentlelady. Ms. Davis, you are 
recognized for 5 minutes.
    Mrs. Davis. Thank you, Mr. Chairman and ranking chairman as 
well. I am very sorry that I missed all of your discussion 
before this. But as a former school board member for nine 
years, I am just trying to understand. Certainly, the situation 
in San Diego, California is different, for example, then in 
Oklahoma.
    But it seems that you are asking for a very clear rule on 
this, and at the same time, asking for perhaps no rule, and I 
wonder if you could clarify for me what you feel is absolutely 
best.
    One of the things I know is that nothing makes people 
crazier, of course, when they are trying to follow the rules 
and having difficulty with it, and on the other hand you have 
just from a governance point of view the problem of a school 
board member who is trying to balance out very, very close 
numbers perhaps, percentages of young people in one group or 
another who need to be served, and it is minuscule in many 
cases, and yet they are having to decide and direct resources.
    How would you do that? Because we are struggling with this, 
obviously. What needs to be done? How clear or on the other 
hand, how muddled? Which makes more sense?
    Mr. Owens. Thank you, Representative Davis. In my 
testimony, what we suggest from Oklahoma is that the U.S. 
Department of Education, if the numbers are accurate, and I do 
not have the capacity to evaluate whether it is 10 percent of 
schools that would be out of compliance with the special rule 
or 20 percent, I do not know what that number is, but if the 
number is at that 10 percent mark, would it not make more sense 
for the Department of Education to provide individualized 
special treatment for districts that have been identified as 
not investing an appropriate amount of State and local funds in 
their Title I schools because they received Title I funds, 
rather than passing a sweeping regulation that impacts so many 
districts that either do not fall under the rule but 
nevertheless have to do the paperwork associated with it to 
show they are in compliance.
    I am king of a simple think, I like analogies, so for me, 
it is as if we are going to buy a new car because we have a 
flat tire, when we could just replace the tire.
    So if we know there is just a small percentage that are out 
of compliance, we should direct our energy and our effort 
there.
    Mrs. Davis. Mr. Sargrad, could you respond as well? Because 
I think the issue that we are all grappling with is how do you 
limit the inequities that children are going to experience 
because funds are either going towards substitute teachers or 
obviously we have teachers who are newer to teaching, and those 
schools may not be getting the funds. Where do you fall on 
that?
    Mr. Sargrad. I think, just to do a different analogy, maybe 
I would say what we want to do is to make sure just like the 
FDA is responsible for ensuring that all food is safe, we want 
to make sure the Federal Government has the responsibility for 
making sure all districts are spending the amount of money in 
their poor schools that those students deserve.
    We do not tell the FDA to not monitor food safety across 
the country because it might only be in a handful of places 
there is a problem.
    I think it is again a critical Federal role to make sure 
that all districts are meeting the responsibility that the law 
lays out, to say they are using the Federal funds to supplement 
and not supplant the local and State dollars.
    Mrs. Davis. Anybody else want to comment, especially in 
terms of fairness issues? What is fair?
    Ms. Gordon. Thank you. Thank you for your question, 
Representative Davis. I think this is exactly the crux of the 
matter is, is this rule, which is in the statute itself, so 
simple that people do not realize it is a rule.
    And so rather than showing - and if you go back to the July 
2015 guidance that the department issued when the language now 
in the law applied under No Child Left Behind schoolwide 
programs - there was no kind of going back and checking the 
numbers in individual schools, it was about the methodology.
    So this was something Mr. Sargrad described as funds based, 
but it was really about what is the methodology that you are 
using to distribute the funds. It could be you have staffing 
methodology and then you pay the actual salaries of the 
teachers who wind up in the different schools.
    So I would just refer you to that guidance to see how even 
though it is one plain language sentence in the statute, it is 
an auditable standard rather than the rule.
    Chairman Rokita. The gentlelady's time has expired. I thank 
the gentlelady. Ms. Fudge, you are recognized for 5 minutes.
    Ms. Fudge. Thank you, Mr. Chairman. I sit here and listen 
to them talk about congressional intent. I thought the intent 
of the law was equity, that the intent of the law is to at 
least give every child a fighting chance. The intent of the law 
was to make sure every child has an equal opportunity to 
succeed. That is the intent, so I don't know what - if maybe we 
were in different meetings, but that is my recollection.
    Especially as we look at schools becoming more and more 
segregated across this country, and as we look at the fact that 
data continues to show that poor kids are getting shortchanged, 
so I do not know what we are fighting about if the real intent 
of the law is equity. I just do not understand for the life of 
me why if we give poor children their fair share, it is a 
problem.
    Mr. Sargrad, and I am going to use the words of Mr. Owens, 
he indicates that if we give poor children their fair share, 
the sky is going to fall, but his words, and I quote, ``It will 
destroy the stability within classrooms and amongst schools, 
and likely lead to the elimination of programs and initiatives 
that increase student and/or parent choice.'' Do you agree with 
that?
    Mr. Sargrad. Thank you, Ranking Member Fudge. I do not 
agree. I think that these special programs and these additional 
services that Mr. Owens and Dr. Canavero have talked about, 
career and technical education, arts and physical education, 
those are key and they are just as key for low-income students 
as they are for high-income students.
    So I see no reason why non-Title I schools should have 
those opportunities and Title I schools should not.
    Ms. Fudge. Let me further ask this question. For what 
reason would schools not want to give us this information?
    Mr. Sargrad. I cannot see a reason why they would not want 
to. I think the information is certainly complicated, and I 
think Congress was right to include new transparency 
requirements in the law around this kind of spending.
    And so, with those requirements, school districts are going 
to need to be more transparent around spending, and that will 
help them comply with this new supplement not supplant 
requirement.
    Ms. Fudge. What do you believe the intent of the law was, 
Mr. Sargrad?
    Mr. Sargrad. I think the intent is very clear, to protect 
equity and improve achievement for all students, and 
particularly, disadvantaged students.
    Ms. Fudge. Okay. Dr. Canavero and Mr. Owens, you have both 
testified that the new standard for compliance in the proposed 
rule is unacceptable. I have not heard either of you suggest 
what an acceptable standard would be. I can assure you it was 
not Congress' intent to allow compliance with this important 
requirement to be subject to the whims of more than 15,000 
school districts.
    So what in your judgment is a satisfactory standard? Dr. 
Canavero and then Mr. Owens.
    Mr. Canavero. Thank you, Ranking Member Fudge. You know, I 
go back to some comments that Mr. Owens made in relation to the 
issue and the problem statement that is being attempted to 
solve here through this policy. I do not believe anybody or at 
least I do not disagree that additional funding is necessary 
and I think the track record in our State demonstrates that is 
something we support, and that all students absolutely 
fundamentally deserve an opportunity to succeed and claim those 
opportunities in the future.
    What would be a reasonable standard, I think, is what you 
are asking.
    Ms. Fudge. That is the question.
    Mr. Canavero. It is related to, I think, honing in, 
utilizing the data that are available, and I tried to find the 
dataset and I could not, I would love to find it if someone can 
send it to me, utilizing the dataset that is available to 
attack the problem.
    If there is a problem of inequitable spending in 10 percent 
of the school districts, utilizing the very policy and 
enforcement action available to U.S. Ed to get after that--
    Ms. Fudge. What is the answer? You are reciting the 
problem. What is the answer? Mr. Owens, do you have an answer?
    Mr. Owens. Thank you, Ranking Member Fudge. I believe that 
is the answer, if the department--
    Ms. Fudge. And you would do it how? Tell me how you would 
do that if that is the answer.
    Mr. Owens. You could use the language from the statute 
itself where the LEA has to demonstrate to the State Department 
of Education that each Title I school received at least as much 
State and local funds as it would have otherwise received 
absent its status as Title I.
    Ms. Fudge. Is that not the same thing the rule says?
    Mr. Owens. Well, the rule has a heavy focus on the spending 
within Title I schools and non-Title I schools as adjusted for 
personnel or per pupil, and without auditable standards around 
what that looks like, there is confusion at the district level 
as to how the State will interpret. There is confusion at the 
State level as to how the Federal department will interpret.
    Ms. Fudge. Thank you, Mr. Owens, but what I am hearing you 
saying is what the rule is saying. Thank you so much all of you 
for your testimony. Mr. Chairman, I yield back.
    Chairman Rokita. I thank the gentlelady. The gentlelady is 
recognized for her closing.
    Ms. Fudge. Thank you, Mr. Chairman. I thank you for this 
hearing today. I thank you all for being here. I would like, 
Mr. Chairman, to submit for the record a letter from a 
coalition of 31 civil rights education and child welfare 
organizations in support of the department's original proposed 
supplement not supplant regulation.
    Chairman Rokita. Without objection.
    Ms. Fudge. Thank you, Mr. Chairman. With that, I would just 
suggest this. If in fact the intent is what we have all agreed 
it is, just as we have talked at least from my perspective, 
then I would hope that we would not continue to shortchange 
students because we do not want to fill out a piece of paper. I 
yield back, Mr. Chairman.
    Chairman Rokita. I thank the gentlelady. Let me again thank 
the witnesses for their testimony. From my perspective, it is 
pretty clear again what Congress' intent was. We had these 
discussions. We agreed on a solution. Some amendments were 
filed. Some were successful, some were not.
    What is not at issue here is congressional intent and what 
the law is, regardless of any one person's or one 
organization's or 31 organizations' opinion.
    We are either going to live in a country where we all are 
equal under the law, and the law is followed, or we are going 
to live in a country that is dictated by bureaucrats, which one 
is it going to be? We are all after the same goal, and that is 
equity and that is improving the lives of our best and most 
precious asset, our children. No one disputes that. No one is 
not trying to get that done.
    And again, we agreed on what the new approach should be, 
and it is nothing at all what the Department of Education is 
now trying to propose and the authority it is trying to usurp.
    I want to go back, again, to this issue of congressional 
intent. We understand that executive agencies are responsible 
for implementing the laws, not making them. They are not 
allowed to take the plain language of statutes and rewrite it.
    And I want to direct everyone in the room back to the 
screen. On the screen, this came up in my questioning as well, 
it is the 2012 recommendation from the Center for American 
Progress and the American Enterprise Institute. Reading the 
last half, it says, quote, ``If districts can document that the 
manner in which they allocate State and local resources to 
schools is Title I neutral, they should be clear of suspicion 
around supplanting non-Federal funds with Title I dollars.'' 
Right?
    A left leaning group and a right leaning group came 
together and agreed that this makes sense, why? For the benefit 
of our children.
    The next slide on the screen is the statutory language from 
the Every Student Succeeds Act that Congress again adopted and 
the President signed in response to this recommendation. It 
says, quote, ``To demonstrate compliance with paragraph one, a 
local educational agency shall demonstrate that the methodology 
used to allocate State and local funds to each school receiving 
assistance under this part ensures that such school receives 
all of the State and local funds it would otherwise receive if 
it were not receiving assistance,'' ``under this part'' meaning 
Title I, close quote.
    And finally, the next slide is the Senate committee report 
produced by Ranking Member Murray and Chairman Alexander. Most 
of us participated in that conference committee. It explained 
the congressional intent. It says, quote ``Specifically, the 
bill allows States and LEAs to comply with SNS for Title I Part 
A funds if they can document that the manner in which they 
allocate State and local resources to schools is Title I 
neutral, or that the methodology does not account for the Title 
I funds that schools will receive,'' close quote.
    So the statutory language says that the school districts 
will be considered in compliance with supplement not supplant 
if they can demonstrate that the method, to Dr. Gordon's point, 
that the method they use to allocate funds does not consider 
whether or not a school receives Title I funds. The statute 
very specifically does not require any particular funding 
outcome, Mr. Sargrad. That is the law. That is what we 
intended.
    Funding outcomes are not considered here. and there is 
nothing in the statute or the history of this provision to 
support what the department is proposing.
    Again, I want to thank the witnesses for their testimony. 
When we negotiated this final legislative language and the 
President signed it, I thought we were out to a good start. I 
thought we were really breaking ground. I still think that 
today. I am optimistic. The leadership here, by all four of 
you, is emblematic of that. And you are going to be on the 
front lines of this.
    I do not believe that Washington has better answers than 
you do, especially you, Dr. Canavero, and you, Mr. Owens. You 
have the right intent, you have the right heart and the right 
brains for this kind of work, and the colleagues that you 
represent. And that is what we intended in Congress, is to give 
you that responsibility and that authority back to protect and 
grow our best assets.
    And that is why we are going to continue this approach, and 
we are going to continue in this oversight phase of ESSA to 
make sure that we remain a country where all of us live under 
law that were passed by this body and not the Executive Branch.
    Thank you very much for your time today. This hearing is 
adjourned, seeing no other business before it.
    [Whereupon, at 11:43 a.m., the subcommittee was adjourned.]
    [Additional submissions by Ms. Fudge follows:]
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