U.S. Secretary of Education Rod Paige, testifying today before Congress, declared that President Bush's proposed education budget demonstrates his "substantial commitment to supporting educational excellence and achievement" by promoting "high standards, leadership and the use of proven educational methods."

In an appearance before the House Labor-HHS-Education Appropriations Subcommittee, Secretary Paige said the $53.1 billion sought for Education Department programs in 2004 represents more than a 25 percent increase since 2001 and a 130 percent increase in federal education funding since fiscal year 1996. 

"In total, the president's budget demonstrates his ongoing, substantial commitment to supporting educational excellence and achievement," Paige testified.  "More importantly, it reaffirms that federal support for education is about more than money.  It is about reform through high standards, leadership, and the use of proven educational methods. 

"Only through the combination of these resources with the effective leadership exemplified in the president's No Child Left Behind initiative can American children and adults benefit," he said.

Following is the text of the secretary's statement to the committee, as prepared for delivery.

Mr. Chairman and Members of the Committee:

Thank you for this opportunity to testify on behalf of President Bush's 2004 budget for the Department of Education.  I am proud to appear before you today, discussing the many ways that President Bush's 2004 Budget and other initiatives support educational opportunity for American children and adults.

As you know, earlier this year we celebrated the first anniversary of the No Child Left Behind Act of 2001, which President Bush signed into law on January 8, 2002.  State officials, administrators, and teachers across the country now are working hard to strengthen their accountability systems, identify research-based strategies for improving student achievement, and offer new choices to parents whose children attend low-performing schools.

The President's budget seeks $53.1 billion for Department of Education programs in 2004.  That represents more than a 25 percent increase since 2001, and a 130 percent increase in Federal education funding since fiscal year 1996.  Key increases for the cornerstones of the Federal role in education include:

• $12.4 billion for Title I, a 41 percent increase since the passage of No Child Left Behind;
• $9.5 billion for IDEA grants to states, a 50 percent increase since he was elected President; and
• $12.7 billion for Pell grants, for a record 4.9 million students.

In addition to discretionary spending in this budget, the President's budget provides significant mandatory support for education.  The President seeks additional loan forgiveness for teachers in high-demand disciplines.  He also seeks changes in the tax code to improve education.  As you will recall, the President backs the CRAYOLA credit for teachers, allowing them a $400 above the line deduction for out-of-pocket expenses.  He continues to support the changes in last year's tax law that help students and families save for higher education.

In total, the President's budget demonstrates his ongoing, substantial commitment to supporting educational excellence and achievement.  More importantly, it reaffirms that Federal support for education is about more than money.  It is about reform through high standards, leadership, and the use of proven educational methods.  Only through the combination of these resources with the effective leadership exemplified in the President's No Child Left Behind initiative can American children and adults benefit.

Before I go into more detail about specific areas of our request, I want to recognize that the President's 2004 budget request is somewhat unusual, in that it was developed before the Congress completed its work on the 2003 appropriation.  The request for the Department of Education reflected the Administration's relative priorities -- at the time -- within the overall 2004 discretionary total.  We are prepared to work with the Congress to adjust some of these priorities, in light of the 2003 appropriation, as long as overall discretionary appropriations do not exceed the total in the President's budget.

IMPLEMENTING NO CHILD LEFT BEHIND

As President Bush said on the first anniversary No Child Left Behind, "We can say that the work of reform is well begun."  The Department of Education has approved the accountability plans of five States, and all remaining States submitted their plans on schedule at the end of January.  We will be working with these States over next few months to refine and complete those plans, and I am confident that all States will be on board when the new school year begins next fall.  Now that the fiscal year 2003 appropriations bill has been completed and signed, the Department will be able to provide States with more reliable estimates of the Federal funding that will be available for the coming school year.

The 2004 budget request will help ensure that this work does not falter, but continues until, in the President's words, "every public school in America is a place of high expectations and a place of achievement."

The request would provide $12.4 billion for Title I Grants to Local Educational Agencies to help States and school districts turn around low-performing schools, improve teacher quality, and increase choices for parents.  This level represents a $3.6 billion increase, or 41 percent, in Title I Grants to LEAs funding since the passage of No Child Left Behind.  The budget also provides $390 million for State Assessment Grants to help States develop and implement -- by the 2005-2006 school year -- the annual reading and math assessments in grades 3 through 8 that are integral to the strong State accountability systems required by the new law.

We are seeking $1.05 billion for Reading First State Grants and $100 million for Early Reading First, two programs that require State and local educational agencies that receive funds to capitalize on recent research findings by supporting proven methods for improving the reading skills of young children.  A $185 million request for Research, Development, and Dissemination would build on this research base and fund new efforts to develop proven, research-based instruction in other subjects like mathematics.

MORE CHOICES FOR PARENTS

No Child Left Behind provides unprecedented choice for parents of children trapped in low-performing schools.  To support and enhance the law's reforms, the budget provides $75 million for a new Choice Incentive Fund to increase the capacity of state and local districts to provide parents, particularly low-income parents, more options for maintaining a quality education for their children who are trapped in low-performing schools; $25 million for Voluntary Public School Choice grants that would encourage States and school districts to establish or expand statewide and interdistrict public school choice programs; and $100 million to expand the new credit enhancement program that will help charter schools pay for school facilities.

IMPROVING AMERICA'S TEACHING CORPS

The President believes that well-prepared teachers are essential to ensuring that all children reach high State standards.  That is why in his budget he calls for over $4.5 billion to support our Nation's teachers.  Included in this total is $2.85 billion for Title II Teacher Quality State Grants; more than $500 million in loan forgiveness and teacher tax reductions; an estimated $814 million in funds supporting improvement through Title I, Educational Technology State Grants, and Title III professional development grants; $25 million for Troops to Teachers; and $190 million for the high-need areas of special education and American history.

SPECIAL EDUCATION AND VOCATIONAL REHABILITATION

President Bush has demonstrated a strong commitment to improving educational opportunities for children with disabilities, both by requesting significant annual increases for Special Education Grants to States and in his determination to apply the same rigorous accountability demanded by No Child Left Behind to the upcoming reauthorization of the Individuals with Disabilities Education Act (IDEA).  Over the next year, we will be working with Congress to renew IDEA to strengthen accountability for results, simplify paperwork and increasing flexibility, do what works based on sound research, and increase choice and meaningful involvement for parents.

The President also recognizes, however, that educating students with disabilities is a special challenge for States, school districts, and schools.  This is why his budget would provide $9.5 billion for Special Education Grants to States, the highest level of Federal educational support ever for children with disabilities, and a $3.2 billion or 50 percent increase in Grants to States since the President took office.

The 2004 budget also supports the reform of the Federal government 's overlapping training and employment programs for individuals with physical or mental disabilities first proposed in last year's budget.  A $2.7 billion request for Vocational Rehabilitation (VR) State Grants would help State VR agencies increase the participation of those individuals in the labor force while at the same time reducing duplication and complexity in the operation of Federal training programs.

VOCATIONAL AND ADULT EDUCATION

The Administration will be proposing fundamental changes to vocational and adult education programs during their upcoming reauthorizations.  For vocational education, this means greater emphasis on student outcomes and stronger links with high school programs, including activities supported by the ESEA Title I program.  Our request would provide $1 billion for a new Secondary and Technical Education State Grants program that would create a coordinated high school and technical education improvement program in place of the current Vocational Education State Grants program.  The new program would build on No Child Left Behind by ensuring that States and LEAs focus more intensively on improving student outcomes, such as academic achievement, and that students are being taught the necessary skills to make successful transitions from high school to college and college to the workforce.

A $584 million request for Adult Basic and Literacy Education State Grants would support reauthorization proposals that would strengthen accountability, require State standards for adult literacy activities leading to high school-level proficiency, and train teachers in the use of research-validated instructional practices.

POSTSECONDARY EDUCATION

Finally, our 2004 request would support more than $62 billion in grant, loan, and work-study assistance to an estimated 9.2 million postsecondary students and their families.  The cornerstone of this assistance is a $12.7 billion request for the Pell Grant program.  Since taking office, President Bush has requested an unprecedented $4.7 billion in additional funding for this critical program.  The 2004 request will enable almost 4.9 million students to receive a Pell Grant, an increase of 1 million students or 25 percent since the President took office 2 years ago.

Our postsecondary student loan programs also continue to make available needed assistance to millions of students and their families.  For 2004, new student loans provided under the Federal Family Education Loans and Federal Direct Student Loans programs will grow from $44.3 billion to $47.6 billion, an increase of $3.3 billion or 7.4 percent.  And these students are borrowing at the most favorable interest rates in the history of the student loan programs -- just 4 percent.  At the same time, student loan default rates remain low, reflecting both improved management practices and flexible repayment plans that can accommodate student needs both before and after graduation.

Also, the President is again asking Congress to approve his plan to provide additional loan forgiveness for highly qualified math, science, and special education teachers who work in low-income communities.  The president's proposal will provide up to $17,500 in loan forgiveness for teachers in these three fields who work for five consecutive years in schools that serve high poverty student populations.  This is more than three times the $5,000 in loan forgiveness now allowed for other qualified elementary and secondary teachers serving low-income communities.  This proposal will help our neediest schools recruit and retain highly qualified teachers in fields that have critical teacher shortages, as well as fields that face fierce competition from the private sector.

In addition to grants and loans, postsecondary students and their families benefit from a variety of tax-related assistance in paying college costs passed as part of President Bush's tax proposal in 2001.  Under the new tax law, families are able to make tax-free withdrawals from pre-paid qualified State tuition savings plans, and can contribute up to $2,000 to Education IRAs.  Plus, students are eligible for up to $4,000 in above-the-line deductions for higher education expenses.   The tax bill also eliminated the 60-month limitation on student loan interest deductions and increased the income levels of individuals able to claim the deduction.  This change makes this tax benefit simpler to administer and increases the affordability of student loan repayment.  Additionally, the bill extended the income exclusion for employer-provided educational assistance and the benefit of the exclusion to graduate level courses.  Combined with other tax benefits already on the books, over $10 billion this year in tax breaks will be provided to working families who are struggling to meet the skyrocketing cost of college and to students who are repaying their student loans.  The President's 2004 budget would make the important benefits provided in the 2001 tax law permanent.

In addition, a $224 million request for the Strengthening Historically Black Colleges and Universities program demonstrates the President's commitment to help close achievement and attainment gaps between minority students and other students by assisting institutions that enroll a large proportion of minority and disadvantaged students.  Similarly, a $94 million request Hispanic-serving Institutions would help increase academic achievement, high school graduation, postsecondary participation, and life-long learning among Hispanic Americans.

Overall, the president's 2004 higher education budget proposal further demonstrates his commitment to invest in the future of America's neediest students at all levels of education.  The substantial funding increase we are seeking will help millions of needy families pay for higher education and give millions of students the opportunity to pursue their educational goals and make the most of their potential.

While No Child Left Behind reforms are asking States and schools to improve their accountability in the use of education funds, we have tried to set an example by improving our own management. Just last month, the Department of Education received its first clean audit since 1997 and only the second in the history of the Department.

I am also proud to report that the Office of Management and Budget has given the Department its seal of approval by giving us a score of "green" for our progress in improving management on all items in the President's Management Agenda.  This is especially rewarding since we had to work our way up from the bottom on each of the  initiatives ranging from financial management to electronic government to linking program performance and budgeting.

In the 2004 budget, the Administration launched the Program Assessment Rating Tool (PART) process to rate programs according to performance.  The President's goal was to rate 20 percent of all Federal programs in the first year.  In the 2004 budget, the Department of Education rated 18 programs covering $28 billion or more than half of its appropriation.  One finding was that many programs lacked performance information.  We will work on that in the future, because the PART scores tend to fluctuate based on the strength of data about program success.  The PART is a new process and we look forward to increasing our ability to base budget decisions on program effectiveness.   

I believe we have a strong budget for education in fiscal year 2004, one that puts significant resources where they can do the most to help improve the quality of educational opportunities at all levels of the American education system.  I will be happy to take any questions you may have.

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