CHARLESTON — As the clock ticks down to the end of the 2024 legislative session Saturday, lawmakers are working on a budget for the next fiscal year, with questions remaining over a pending waiver of nearly half-a-billion dollars West Virginia might have to dump into education spending.
In a press conference Monday morning, members of the House Democratic caucus demanded answers from Gov. Jim Justice and the Republican majority over negotiations between the state and the U.S. Department of Education to waive federal requirements to meet a required education spending threshold to avoid having a clawback of more than $1.1 billion in COVID-19 education grants.
“We are demanding answers right now,” said House Minority Leader Sean Hornbuckle, D-Cabell. “The people of West Virginia deserve transparency and be able to have a government that they can trust.”
It was revealed last week during a House Finance Committee meeting, where the budget bill for fiscal year 2025 beginning in July was presented, that the state is in negotiations for the U.S. Department of Education for the second year in a row over the fiscal year 2023 maintenance of effort (MOE) waiver requirements.
As a result of accepting more than $1.1 billion through three tranches of COVID-19 education funding via the U.S. Department of Education’s Elementary and Secondary School Emergency Relief Funds (ESSER), the state was required to maintain a certain percentage of total education spending based on spending during the three fiscal years prior to the start of the pandemic. That percentage was 41.6%, but the state fell short of that percentage in fiscal years 2022 and 2023.
The state applied for a waiver from this requirement in 2022, explaining that due to the state’s student aid formula and how education is funded in the state, direct funding of education was difficult.
Instead, the state demonstrated compliance by showing how education was funded in alternative ways, including pay raises, stabilization of the Public Employees Insurance Agency, funding for deferred maintenance and new school construction, the Communities in Schools program and other spending. The state was granted its first waiver in 2023.
However, West Virginia is facing a similar problem for its fiscal year 2023 reporting, with total education spending only at 34.7%. Unless the state receives a second waiver, West Virginia would have to spend $465 million in order to get the total education spending up to the 41.6% benchmark. If the state doesn’t do that, it could result in a clawback by the U.S. Department of Education of some of the $1.1 billion awarded to West Virginia.
“That’s about 10% of our budget,” said Delegate John Williams, D-Monongalia. “I don’t know if we have access to these funds or not, if we’re going to be able to pay it.”
“It’s a blindside for us. It’s blindside for you. It’s not a blindside for the people that are in charge. That’s what it comes down to,” Hornbuckle said. “We’ve got to figure out this mismanagement first. We’re really troubled by it.”
In a statement over the weekend, Gov. Jim Justice said their negotiations with the U.S. Department of Education have been fruitful, and he expects to receive a waiver soon. However, he criticized the department’s maintenance of effort rules, which were not finalized until 2022, which he said penalized the state for ending the last two fiscal years with more than $1 billion in tax revenue surpluses.
“The sole issue raised in the federal rules is whether West Virginia’s spending on education rose enough in proportion to the state’s overall spending,” Justice said. “The federal rules, however, focus on percentages. They penalize West Virginia for its economic success and investing in roads, infrastructure and bringing good-paying jobs to West…
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