Tennessee is talking about rejecting federal education funding. What would that mean for kids?

When House Speaker Cameron Sexton recently floated the idea of Tennessee rejecting U.S. education dollars to free its schools from federal rules and restrictions, he made the pivot sound as simple as making up the difference with $1.8 billion in state funds.

“I don’t think the legislation would be too hard to do,” he said last week after publicly declaring his desire to “do things the Tennessee way” at a Tennessee Farm Bureau reception on Feb. 7.

But the way federal funding works is pretty complex. Some districts and schools are more dependent than others on that money, which is directed to schools that serve disadvantaged students and programs that target certain needs ranging from rural education and English language learners to technology and charter schools. A related web of state and federal laws and policies created in response to the federal grants also likely would have to be unwound.

Sexton told Chalkbeat he’s working on legislation to “start a conversation” about the possibilities. And once filed, his written proposal might answer some of the many questions that Tennesseans are asking about what such a change would mean for kids and schools. 

But for now, here are a few answers, along with more questions to ponder:

Is the proposal in Tennessee serious?

While a spokesperson for the U.S. Department of Education dismissed Sexton’s comments as “political posturing,” the House speaker said he’s dead serious.

“I absolutely think we should do it,” Sexton told Chalkbeat.

Sexton noted that, based on the latest budget information, Tennessee could tap into $3.2 billion in new recurring revenues, which would more than cover any lost federal funds for education.

“Now is the time to look at it,” said Sexton, who as House speaker is one of the state’s most influential Republicans. “It doesn’t mean that you do it this year or you have to do it in the next six months, but it starts with the idea.”

Spokespeople for Republican Gov. Bill Lee and Lt. Gov. Randy McNally expressed openness to Sexton’s proposal, while several education leaders in Tennessee’s GOP-controlled legislature expressed outright enthusiasm.

“I would do everything in my power to pass that bill,” said Rep. Scott Cepicky, of Culleoka, who chairs a House education subcommittee and said he “wants Tennessee to have more autonomy when it comes to educating our kids.”

“It’s intriguing,” added Rep. Debra Moody, of Covington, chair of the House Education Instruction Committee. “I think my constituents at home would love it.”

Others were more reserved in their comments.

“It’s a thought-provoking idea, but I’d like to see details,” said Senate Education Committee Chairman Jon Lundberg, of Bristol. “I have questions about what federal strings would be removed and, more importantly, do those strings need removing? Right now, I don’t know.”

Can Tennessee say ‘no’ to federal money?

Probably. No state has rejected the funding so far, mainly because states typically need the money, which on average makes up about a tenth of their budgets for K-12 education.

But Republican leaders in other states have talked about the idea before, and Oklahoma lawmakers are currently considering legislation to phase out federal funding over 10 years for pre-K through 12th grade. A smattering of small school systems across the nation already have passed on federal money because of the cost of compliance.

“States do not have to accept federal funding at first glance,” said Matthew Patrick Shaw, assistant professor of law, public policy and education at Vanderbilt University. “These are carrot-stick programs in which the federal government has policy objectives and, in order to encourage states to go along with them, offers money that they believe states need to operate these programs.”

Would the change disrupt finances for students and schools across Tennessee?

Possibly, but a lot would depend on how it’s done.

Through a program known as Title I, the federal government distributes hundreds of millions of federal dollars to Tennessee schools that serve large concentrations of students from low-income homes to help improve achievement. If Tennessee replaced Title I funding with state money, would it still use the federal formula for distributing that money? Sexton hasn’t said.

The same question applies to federal funds that go to Title III programs to support English language learners, or for Title V programs to support rural education.

Sexton says Tennessee would still cover the costs of all of those programs, as well as free meals funded through assorted grants from the U.S. Department of Agriculture.

But in Memphis-Shelby County Schools, where all but eight of the system’s 155 district-run schools have Title I designations, some officials aren’t convinced about the stability of state funding.

“If Tennessee decided to do it our way, what does ‘our way’ look like?” asked school board member Amber Huett-Garcia, whose district expects to receive more than $892 million in federal funding next year.

“Would it achieve equity? Would Memphis continue to receive the share that it currently gets?” she continued.

More questions:

While Tennessee is currently flush with cash and able to backfill federal funding, could the state sustain that level if a recession hit down the road?

Are Tennesseans OK with paying federal taxes that support education spending, without getting any of that money back for their students and schools? 

Or would they rather keep taking federal funds and put the new state money instead toward addressing longstanding needs such as teacher pay, early child care, and crumbling and overcrowded school buildings.

“You’re really making Tennessee taxpayers pay twice for the same underfunded public school system,” said Rep. John Ray Clemmons, a Nashville Democrat who chairs his party’s House caucus. “That is completely fiscally irresponsible and jeopardizes the entire future of this state.”

Huett-Garcia, of Memphis, asks: What if there’s another global pandemic or a natural disaster, like when flooding and a tornado destroyed several schools in Middle Tennessee in recent years? (Through three pandemic recovery packages approved by Congress since 2020, Tennessee has received more than $4 billion in federal funds for K-12 education.)

“At some point, we will need the federal government,” she said. “You have to consider whether halting our current federal funding mechanism could end up cutting us off from innovative funding or emergency resources in the future.”

What federal strings does Sexton want to cut?

Testing is the main problem, according to Sexton.

“I don’t think the TCAP test measures much of anything, and I think teachers would tell you that you’re teaching to a test,” said Sexton about the state’s annual test under the Tennessee Comprehensive Assessment Program.

States that take federal money must give annual assessments in reading and math in grades 3-8 and once in high school. They also are required to administer a science test one time each in elementary, middle and high school grades. Thus, each state must give 17 tests annually, though no individual student takes more than three of those tests in a given school year.

Sexton said Tennessee could scrap TCAP — which Tennessee developed through its testing companies to align with the state’s academic standards — and create a better test with the help of its educators. 

But several education advocates note that states already have more flexibility than ever to develop their testing, evaluation, and accountability systems under a 2015 federal law crafted with the leadership of former U.S. Sen. Lamar Alexander of Tennessee.

“When shepherding the Every Student Succeeds Act, Sen. Alexander was laser-focused on Tennessee and what Tennessee would need to be successful,” said Sasha Pudelski, national advocacy director for the School Superintendents Association.

States receiving Title I funds also must participate in national tests of fourth- and eighth-grade students in reading and math every two years. Known as the nation’s report card, the National Assessment of Educational Progress allows comparisons across states and is an important marker for showing how students are doing over time.

Lundberg, a key education leader in the Senate, said such testing data is important for Tennessee.

“I want to make certain that we’re able to continue comparing Tennessee to Montana or California or Michigan,” he said. “If we really want to be No. 1 in the nation in education, we need to be able to measure apples to apples across states.”

Incidentally, the TCAP exam that Sexton wants to scrap is the same standardized test that a 2021 Republican-backed reading law uses as the only criterion to determine whether third-graders can progress to the fourth grade. Lawmakers have filed numerous bills this year to address concerns about the retention policy, which kicks in with this year’s class of third graders. 

What other federal mandates are considered burdensome?

Few would dispute that accepting federal funding comes with a lot of red tape. Mounds of paperwork and numerous audits of how money is spent are all part of a huge bureaucratic infrastructure that comes with administering billions of dollars of federal funding.

But Sexton, who said there are “a gazillion restrictions” he doesn’t like, did not enumerate other burdens beyond testing, despite Chalkbeat’s multiple requests to his office for a list.

Marguerite Roza, a Georgetown University professor who researches education finance policy, said she suspects the bigger objections are related to current “culture wars” about curriculum and whether transgender students should be allowed to use school bathrooms or play sports consistent with their gender identity, which may not correspond with their sex assigned at birth.  

“Those strings come from the U.S. Department of Education’s Office of Civil Rights,” Roza said.

Civil rights enforcement is the mission of that office based on the passage of federal laws such as Title VI of the Civil Rights Act of 1964, Title IX of education amendments passed in 1972, and Section 504 of the Rehabilitation Act of 1973, which prohibit discrimination based on race, sex, and disability.

And Tennessee has been at the forefront of culture war legislation. It passed more laws in 2021 aimed at limiting the rights of transgender people than any other state in the nation, according to an analysis by The Associated Press.

The state also has passed laws in recent years to prohibit the teaching of certain concepts related to race and sex in classrooms and to allow an appointed state panel to ban certain school library books statewide if members deem them inappropriate for the ages of students who can access them.

If Tennessee rejects federal funds, would the state still have to ensure students’ civil rights protections under federal laws, including for students with disabilities?

The Individuals with Disabilities Education Act, or IDEA, is a federal funding statute that says schools must identify students with disabilities and provide them with a free and appropriate public education tailored to their needs. But generally speaking, legal experts say, those requirements apply only to states that accept IDEA funds.

“If I were a parent of a child with a disability, this would be a major concern,” said Gini Pupo-Walker, state director for The Education Trust in Tennessee. “Would my child’s rights and needs be protected without the federal funding and oversight?”

Sexton says the state would still fund services that are currently part of IDEA and would come up with a similar program that he believes could be better.

But the Tennessee Disability Coalition says there’s no assurance that a Tennessee version would give families the same or better protections than under IDEA or other federal laws designed to protect students with disabilities.

“It’s hard for the disability community to trust Tennessee when our state’s track record hasn’t been so great,” said Jeff Strand, the coalition’s government affairs coordinator. “Our state institutions for people with intellectual and developmental disabilities have a long history of abuses, and we continue to see a troubling pattern of actions such as our state’s choice not to accept federal funding to expand Medicaid services.”

Another concern is where families could appeal when the system isn’t working for their students. Under IDEA, they can call for a meeting at school to speak with teachers, administrators, and case managers. If they’re not satisfied, they can appeal all the way up to the Office of Civil Rights. Dozens of disability-related cases in Tennessee schools are currently being investigated by that federal office, which has the power to take away funding from states or schools that don’t follow the law.

“It’s already tough to live with a disability in Tennessee,” said Strand. “A change like this would cloud a specific longstanding avenue that ensures that the rights of students with disabilities are being protected. And it clouds it for no good reason.”

Beyond IDEA, federal civil rights laws are hard to unpack because some are also linked to receipt of federal funds, so it may depend on how state laws are structured.

The Office of Civil Rights also enforces Section 504 of the Rehabilitation Act of 1973, a civil rights statute which prohibits discrimination against individuals with disabilities, as well as Title II of the Americans with Disabilities Act of 1990, which extends this prohibition against discrimination to government services such as public schools, regardless of whether they receive any federal financial assistance.

Several legal experts believe many Tennessee families likely would turn to the courts over alleged violations of those laws based on the state constitution, which guarantees equal access to a system of free public education, or the 14th Amendment to the U.S. Constitution, which guarantees equal protection under the law and due process of law.

“If you want to know how this change would affect children,” said Vanderbilt’s Shaw about the possibility of rejecting federal funds and restrictions, “there’s just a lot of uncertainty.”

Marta Aldrich is a senior correspondent and covers the statehouse for Chalkbeat Tennessee. Contact her at [email protected].