The U.S. Department of Education’s Office of Inspector General issued an “alert memorandum” dated September 2009 which documents loopholes in the federal stimulus law that allowed at least 3 states, including Massachusetts, to violate the intent of the law by cutting  rather than increasing spending on public education. This report is, in part, a result of the formal complaint PHENOM had filed.

Echoing PHENOM’s complaint, the report says:

In the Governor’s SFSF application, signed on May 20, 2009, Massachusetts applied for a waiver of the MOE requirements for public IHEs in FY 2010 and FY 2011, asserting that the State will be unable to fund public IHEs at the FY 2006 level. In order to meet the requirements for the MOE waiver, a State must show that it is spending at least as much State money on education, as a percentage of total revenues, as it did in the previous year. Massachusetts is able to meet this requirement because of its $412 million reduction in the FY 2009 Chapter 70 appropriations, which reduced the percentage of State revenue spent on public education in FY 2009. This reduction in State funding was replaced with SFSF funds. The reduction also allowed Massachusetts to reduce State support for public IHEs below the FY 2006 level for FYs 2010 and 2011 while maintaining the percentage of State revenue spent on public education at least at the FY 2009 level.

The report recommends that the DOE not award additional stimulus funds until Massachusetts (and the other states) meet certain funding requirements.  The report and recommendations have been accepted by the Assistant Secretary of Education.  We believe the result will be a significant influx of funding for public higher education.  We are pleased that PHENOM was able to play a role in obtaining this funding.