"Impact Aid" School Districts Brace for Sequester

Last Updated: March 06, 2013

In FY 2011, the Impact Aid Program disbursed more than $1 billion in unrestricted federal funds directly to local school districts. Many of these Impact Aid districts are located in rural communities with high levels of poverty.

The Impact Aid Program, Title VIII of the Elementary and Secondary Education Act (ESEA), provides assistance to local school districts with concentrations of children residing on Indian lands, military bases, low-rent housing properties, or other Federal properties and, to a lesser extent, concentrations of children who have parents in the uniformed services or employed on eligible Federal properties who do not live on Federal property.

Impact Aid was designed to assist local school districts that have lost property tax revenue due to the presence of tax-exempt Federal property, or that have experienced increased expenditures due to the enrollment of federally connected children, including children living on Indian lands. School districts use Impact Aid for a wide variety of expenses, including the salaries of teachers and teacher aides; purchasing textbooks, computers, and other equipment; after-school programs and remedial tutoring; advanced placement classes; and special enrichment programs.

For some school districts, Impact Aid funding accounts for up to 65 percent of their operating budget. There are basically four areas of federal impaction: Indian trust or treaty lands, low-rent housing, projects, and military bases, and other federal ownership of land such as national parks, federal prisons, VA hospitals, and other federally-owned parcels of land.

To find out more about Impact Aid, click   “Basics of Impact Aid,” or “Impact Aid Powerpoint Presentation”

For more information about the potential effects of the federal sequester, including state-by-state impact, please go to:

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