Some states have played a shell game with federal education stimulus dollars, going against the stated purpose of the stimulus and replacing state education funding with stimulus funding. Even in states that were not facing huge budget deficits the states have reduced state education spending and replaced state dollars with federal dollars.
The Department of Education's inspector general reports that some states are using stimulus dollars to replace money they've cut from their education budget — despite instructions to the contrary. . . .
Nonetheless, it wasn't long before the Education Department started hearing about states playing what it called "shell games" with stimulus funds. In at least one case, department officials blocked a state from drawing stimulus money because it was cutting school funding so deeply.
This growing dispute with states has become so politically charged that the department declined to comment for this story.
The department's inspector general, on the other hand, isn't shy at all.
In its report about how states were spending stimulus funds, the inspector general's office found that over a dozen states are inappropriately using stimulus dollars to replace the money they're cutting from education. It specifically cited Massachusetts, Pennsylvania and Connecticut.
The bottom line is that the education portion of the stimulus has gone to backfill state education spending which simply allows states to shift money to other budget areas rather than solving ongoing budget shortfalls and ultimately does little to stimulate the economy.