New Federal Relief for Education in the American Rescue Plan

On March 11, 2021, President Biden signed the $1.9 trillion American Rescue Plan, with another round of COVID-19 relief funding for education. The new law includes:

  • $129 billion for K-12 state education agencies, including $800 million for children experiencing homelessness
  • $40 billion for colleges and universities
  • $2.75 billion to governors for use by private schools
  • $3 billion to support the Individuals with Disabilities Education Act
  • $7.2 billion is also provided to the E-rate program for home internet access and devices

Funding to each state will be allocated based on the amount of Title I funding the state or district receives. States are required to give at least 87.5 percent of their allocation to school districts, including charter schools that are considered districts. They are also required to set aside:

  • 5% to address learning loss
  • 1% for evidence-based comprehensive afterschool programs
  • 1% for evidence-based summer enrichment

At least 20% of district funds must be used to address learning loss through evidence-based interventions that support students’ academic and social and emotional learning (SEL) needs. The remaining dollars can be spent on any allowable use under the following:

  • Elementary and Secondary Education Act, Individuals with Disabilities Education Act
  • Carl D. Perkins Career and Technical Education Act
  • Adult Education and Family Literacy Act

Districts can also use the funding to work with local health departments and for activities to address the needs of students from low-income families, children with disabilities, English language learners, racial and ethnic minorities, students experiencing homelessness, and youth in foster care. Additionally, American Rescue Plan funds can be used to:

  • purchase educational technology, including hardware, software, and assistive learning devices.
  • support summer learning and supplemental after-school programs.
  • provide mental health services.
  • update school facilities to reduce risk of virus transmission.
  • develop and implement school health and safety protocols based on guidance from the Centers for Disease Control and Prevention.
  • maintain the operation and continuity of services by employing existing staff.

The new law includes a mandate for schools to be transparent about reopening. Within 30 days of receiving their allocations, school districts must publish plans for reopening schools for in-person learning.

This new funding from the American Rescue Plan is in addition to $82 billion for the Education Stabilization Fund and $30.75 billion allocated in the Coronavirus Aid, Relief and Economic Security (CARES) Act. This additional funding will significantly help schools reopen in person, but they are also going to need support and services from the education industry to ensure that all students are on track to achieve their highest potential. As you develop your plans to reach educators and share the ways that you can help, remember that you can obtain funding information by district from MDR’s MarketView.


See What the Huge COVID-19 Aid Deal Biden Has Signed Means for Education, in Two Charts

The American Rescue Plan: What’s In It for K-12 Schools?

American Rescue Plan Act Summary of K–12 Education Provisions