Page 8


AS PASSED IN 1950, P.L. 874 was to have a life-span of four years, but numerous amendments to the law have kept it alive. At present it is scheduled to terminate on July 1, 1973, although Rep. House Education and Labor Committee, would extend its life for another five years. The Nixon administration opposes the Perkins bill. The great bulk of the money appropriated for P.L. 874 over the years has been to compensate school districts for educating children whose parents either live on or work on federal property. Dr. Harlan is a lecturer in the government department of the University of Texas at Austin. 14 The Texas Observer Impacted problem hurts By Doug Harlan San Antonio “Public Law 874” sounds like an unlikely topic for a hot discussion in a teachers’ lounge. And so it was, until some of San Antonio’s teachers recently learned it may be responsible for a $600 cut in their salaries next year. Public Law 874, or the “Impacted Aid” program, is one of the federal aid to education programs being pruned by the Nixon administration’s economy shears. School districts in Bexar County are especially hard hit by the cut due to the heavy concentration of military bases in the San Antonio area. Other areas of the state are also affected, but none so severely as San Antonio. On Sept. 30, 1950, Congress enacted a financial responsibility of the federal government for the impact which certain federal activities have on the maintenance and operation of local school districts. Under P.L. 874, the federal government is authorized to compensate local school districts for the impact on their budgets caused by: the reduction of tax income resulting from the acquisition of real property by the U.S. government \(thus removing it from the tax rolls of the local the provision of free education to children who reside on federal property; the provision of free education to children who have a parent employed on federal property; and a sudden and substantial increase in school attendance resulting from some federal action \(such as transferring a large RESIDENT NIXON does not like P.L. 874, and he has spoken against it for years, viewing it as a “gravy train” for school districts. The “gravy train” dimension certainly exists in some instances, especially for those districts in the Washington area. For many of the districts, P.L. 874 money is “bonus” money since adequate operating funds come from local taxation and state education agencies. Federal courts have ruled that state departments of education cannot deduct any portion of P.L. 874 payments from the entitlements of a district for state financial aid. Faced with the necessity to cut government spending, President Nixon has whittled at P.L. 874 with, it seems, a considerable degree of satisfaction. However, the President’s pleasure in halting the multi-million dollar windfalls to school districts in the Washington suburban counties seems to have distracted him from the impact of curtailing P.L. 874 funds on districts in other parts of the country. In San Antonio, 12 Bexar County school districts have a combined total enrollment of 51,896 federally connected students or 26.09 percent of their total school enrollment. Under anticipated funding levels for fiscal year 1973, the 12 districts expected to receive a total of $10,638,380 or 8.90 percent of their total maintenance and operation budgets. As of this date, they have received nothing for this fiscal year, expect very little to come, none at all in fiscal 1974. The 12 districts involved in Bexar County represent a broad range of wealth, from one of the poorest in the country \(Edgewood, home district of the Rodriguez the San Antonio districts are significantly below average in their tax base, and P.L. 874 funds are an integral and necessary part of their income. For the San Antonio districts, P.L. 874 is neither a windfall nor a gravy train. It is an essential source of funds for maintaining basic operations. Last year Congress passed and the President vetoed the Labor and HEW Appropriations Act for 1973, which contained P.L. 874 funding. The President vetoed the act because, he said, it was far in excess of his budget requests and contributed to inflation. Congress adjourned without passing a new appropriations act. In order to keep the affected government programs operating prior to passage of an appropriations bill, Congress passed what is called a “Continuing Resolution,” which authorizes existing programs to be continued \(unless which they will be funded. Under the provisions of the Continuing Resolution, P.L. 874 is supposed to be funded at a level of $615 million for fiscal 1973. The Office of Education is not distributing $615 million to eligible school districts, however; it is planning on distributing $415 million, the figure requested in the President’s budget. And, according to the O.E. official in charge, the formula used for distribution will be 100 percent funding of entitlements for Category A students and 73 percent funding of entitlement for Category B students who are military dependents. By eliminating the civilian Category B funding, the “gravy train” to Washington area school districts comes close to being an empty bowl, but the San Antonio districts are cut as well and cut significantly. All of the San Antonio districts’ federally connected students are Category B, and more than half of them are civilian dependents. As a result, the San Antonio districts will lose more than half of their Payment to a district is made on the basis of the number of “federally connected” students enrolled in the district. Such federally related students are classified into two categories: Category “A” students are those who live on federal property and who have a parent who either works on federal property or serves in the armed forces. Category “B” students are those who live off federal property and who have a parent who either works on federal property or serves in the armed forces. This “live on, live off” distinction is important because it, along with a military-civilian distinction, is at the crux of the current crisis. The justification for federal aid to “impacted areas” is that substantial federal activity in an area increases the costs of running a school district \(by increasing local tax revenue to offset the increased costs. Like many well-intentioned programs, however, P.L. 874 has significant drawbacks. Designed primarily to help offset the impact of military installations, the language of the law refers generally to children whose parents are employed on federal property. As a result, school districts located in suburban counties in Maryland and Virginia \(which are among substantial windfalls each year due to the thousands of children whose parents work for the federal government in Washington, D.C. or, in the language of the law, whose parents work “on federal property.”