Marketing Sophomore Travis Shepard watches two news pundits discuss the stimulus package while doing his Spanish homework. Although the legislation was crafted in Washington D.C., it's impact may soon affect him and others in Norman. In the audio below, Senior Economist Keith Leggett discusses the purpose behind including education in the stimulus package.
Stimulus Package Coming to Sooner Country
Oklahoma schools may receive a piece of the stimulus package goodness, which may stop tuition and fee increases for higher education.
Pres. Barack Obama signed the American Recovery and Reinvestment Act of 2009 Feb 17, in hopes of stimulating and stabilizing the current condition of the economy, according to the bill's text. Part of the package designates a large amount of money for k-12 education to upper education.
The package targets multiple investments on the state level including $288 billion towards tax relief and $58 billion towards education and training.
Obama's Federal Stimulus Package will provide $287 million to education in Oklahoma, some of which may end up in the hands of the University of Oklahoma.
Keith Leggett, senior economist for the American Bankers Association, said the purpose behind giving the states part of the package is due to state budgetary problems causing a cut back in their funding of higher education.
"The view was this was going to be a drag on the economy in the short run," Leggett said. "This would also harm long term economic growth because by cutting resources in education we are really reducing our investment in the American people making us less productive going forward."
Leggett said the package will give $40.6 billion, $17.6 billion to increase student aid and $200 billion to work study programs. This bill also contained $14 billion in educational tax credits. Leggett said work study programs are part of it because many students depend on it.
Prior to spring break, the presidents of all publicly funded colleges in the state, including University of Oklahoma Pres. David Boren, met with Gov. Brad Henry. Henry asked the group of presidents that tuition not be increased next year at public universities.
Leggett, however, said he believes tuition and fees will be unaffected due to the fact tuition is driven by other factors and basic supply and demand forces. Leggett said he doesn't see this as a factor that will cut the rate of growth in tuition and fees.
Keri Dennis, congressional staffer for Tom Cole, said after Congress passed a bill with total figures, the education portion was handed over to the Federal Secretary of Education. The numbers and rules are still being worked out by the Federal Secretary of Education.
"From visiting with my contacts at the State level, they know what the total amount will be, however are just in a waiting game until March 31st," Dennis said. "I have also been told that schools are being advised to treat these dollars as "one-time funding" to possibly put in geo-thermal air units, or put on a new roof, or something of that nature."
Most of the money, however, will go towards lower education, but higher education, such as the Univerisity of Oklahoma, may apply for the money.
Higher education may end up receiving roughly $31 billion, according to Leggett. The states will allocate the money to state universities allowing them to maintain faculty and staff and continue to provide resources to meet student body needs.
Higher education can also apply for funding from different portions of the package. Universities, such as OU, may be able to receive money from the energy and environmental portions. Pres. David Boren's $260 million initiative with OG&E to mold OU into a university ran entirely by wind-energy, may be valid for for the energy and environmental sections of the stimulus package.
Leggett said parts of the package allocates resources to alternative energy making grants available that OU may be able to tap into.
The bill also gives $98 million in Pell Grants for Oklahoma. This will increase the average grant by $500.
Nationally, the Pell Grant Program will receive $17 billion from the package. The Pell Grant Program gives low income students the ability to receive need-based grants. Grants are available to both undergraduate and post-baccalaureate students.
Leggett said that the point of the stimulus package is to provide long term commitment to the economy.
"Without this commitment you would see Universities scale back programs. You would also see some students not be able to afford," Leggett said. "Therefore, this would reduce their productivity and in the long run may reduce the standard of living for these individuals."
Dennis said that nobody in education, at the moment, knows exactly how the package will impact education because they do not know the guidelines of implementation. Dennis said it will become clearer March 31.
Those wanting information on the American Recovery and Reinvestment Act of 2009 may visit the official Web site.
Listen to what OU Sophomore Monica Woods says when asked where she thinks the money should go if she were in charge....