Congress regularly provides partial funding for four K-12 education programs through a little understood budgeting technique called "advance appropriations." This budgeting approach takes advantage of a timing quirk whereby the academic year (July 1 to June 31st) spans two fiscal years (October 1 to September 30th). While few federal programs are funded with advance appropriations, it is particularly important to understand how the budgeting approach affects education spending.
Advance appropriations account for 33 percent ($22.6 billion) of the total appropriation for the Department of Education in fiscal year 2012, and over half of all funding for some individual programs. They tend to cause confusion about the actual funding level provided for certain federal education programs for any given fiscal or academic year. The description below explains the use of and limits on advance appropriations.
Education Advance Appropriations Defined
Technically defined, an advance appropriation is funding provided in an appropriation law that becomes available one or more fiscal years after the fiscal year for which the appropriation act was enacted. Thus, the regular appropriation is added to the appropriation for the succeeding fiscal year (the advance appropriation) to reflect the full amount available in a school year. For example, the fiscal year 2012 education appropriations law provided $3.7 billion for Title I grants in that fiscal year and another $10.8 billion as an advance that became available at the start of fiscal year 2013.
The two-part approach to providing funds for a subset of education programs through a regular and an advance appropriation does not matter, in most cases, to the schools receiving the grant aid. The regular appropriation made for fiscal year 2012 and the advance for 2013 both become available to schools in one school year (2011-2012).
The Problem With Advance Appropriations
Advance appropriations make it difficult to assess the actual level of funding for education programs. The subset of education programs funded with advances are effectively funded in three pieces (the prior year advance, the current year appropriation, and the succeeding year advance). Thus, anyone who wishes to assess education funding for a given year needs to analyze each of these three funding pieces and put them together in the right manner to reflect funding in either the federal fiscal year or the school year.
Education advance appropriations also make it difficult to compare spending to the rest of the federal budget, because virtually all programs funded through appropriations receive only one regular appropriation. When Congress considers appropriations bills for the upcoming fiscal year, it effectively considers only part of the education budget for the upcoming year (the regular appropriation), and part of the budget for the year after that (the advance). But even before Congress considers appropriations for the upcoming year, a portion of the education budget has already been determined (the advance from the year before). Thus, the appropriations process involves three parts for some education programs but only one part for the rest of the budget.
Why Advance Appropriations Are Used
Prior to fiscal year 1996, funding for all discretionary education programs was provided in a regular, one-year appropriation. Budget laws in place from 1991 to 2002 provided Congress and the Administration, however, with a new incentive to allocate education funding through advance appropriations. During those years, total spending on appropriations bills was capped in law. Using advance appropriations allowed Congress to increase education spending for a given school year while keeping under a specific fiscal year’s appropriation cap. Because of the timing difference between federal fiscal year and the school year, schools receiving the grant aid were not affected by the shift in funding. More on the history of advance appropriations for education programs can be found in the Federal Education Budget Project issue brief available here.
|Education Advance Appropriations |
($ billions, budget authority)
|Title I Grants||7.9||10.8||10.8||10.8||10.8||Special Education Grants||6.9||8.6||8.6||8.6||9.3||Perkins Vocational Education Grants||0.8||0.8||0.8||0.8||0.8||Improving Teacher Quality Grants||1.4||1.7||1.7||1.7||1.7||Total Advances for Succeeding Fiscal Year||17.0||21.9||21.9||21.9||22.6||Program||2008||2009*||2010||2011||2012||Title I Grants||14.0||14.5||14.5||14.5||14.5||Special Education Grants||10.9||11.5||11.5||11.5||11.6||Perkins Vocational Education Grants||1.2||1.2||1.2||1.1||1.1||Improving Teacher Quality Grants||3.0||2.9||2.9||2.5||2.5||Total Appropriation by School Year||30.0||30.9||30.9||29.7||29.7||*Does not include emergency funding provided by the American Recovery and Reinvestment Act.||Source: U.S. Department of Education; New America Foundation|
The relevant budget laws have expired and fiscal year spending caps are no longer statutorily in place, but Congress continues to make advance appropriations for education programs. It does so because when advances were first made, Congress effectively borrowed from the next fiscal year to fund education programs for the then current school year. If Congress chose to end advances, the first year it did so, it would have to "pay back" what it had been borrowing from future years. That would require a one-time infusion of funds in a given fiscal year creating the appearance of a large increase in funding while simultaneously having no tangible impact on schools.
Budget Rules For Advance Appropriations
In most years since fiscal year 2003, Congress has limited the amount of funding that can be provided through advances in each appropriations cycle. The limit is enforced through a "point of order" that Congress includes in its annual budget resolution. Through the annual congressional budget resolution, Congress has historically restricted advances to a small set of programs, most of which are education programs. The limit was first set in 2003 at $23.2 billion. It was most recently increased to $28.9 billion for fiscal year 2008. That limit was maintained for fiscal years 2010 and 2011. The majority of funding provided under the limit is used on education programs. Because the Senate has not to date adopted a joint budget resolution for either of fiscal years 2012 or 2013, no limit on advance appropriations is currently in place in the Senate. The House has adopted a limit of $28.9 billion in the fiscal year 2012 and 2013 budget resolutions. It is also noteworthy that for the first time since 2002 Congress set appropriations spending limits in law under the Budget Control Act of 2011. Therefore, lawmakers again have an incentive to use advance appropriations to increase or maintain funding levels for education programs by shifting that funding out of the current year and into an advance appropriation in order to skirt the appropriations spending limits, just as they did in the 1990s.