House Committee on Education and Labor
U.S. House of Representatives

Rep. Howard P. “Buck” McKeon
Ranking Member

Fiscally responsible reforms for students, workers and retirees.



Dear Colleague

March 26, 2007

Protect Locally-Designed Performance Pay Systems for America’s Teachers and Principals

Dear Colleague, 

In states and local school districts across the country, education officials have been busy designing and implementing performance pay systems for teachers and principals who demonstrate success in closing the achievement gap inside U.S. classrooms.  Through grants, the federal government has provided states and schools some $100 million in recent years to design and implement performance-based compensation standards.  However, the omnibus spending measure passed by Congress last month virtually eliminated all funding for these programs, leaving many states and local school districts to question whether they can fully implement the teacher recognition pay systems they’ve designed over the past several years.   

A recent news story published in the Arkansas Democrat-Gazette describes such a case in Arkansas.  The article notes that because of the congressional funding cut for these innovative programs, the U.S. Department of Education has only a year’s worth of funding to cover states and schools who have been awarded grants to design and implement teacher and principal performance pay programs.  In Rogers, Arkansas – the school district highlighted in the news article – that means about 325 teachers in ten schools would see their recognition pay bonuses disappear, and worse yet, it places a $2 million grant from a charitable organization in jeopardy as well.  The full article is below. 

This is not an isolated case, unique only to Arkansas.  If Congress doesn’t act, these extraordinarily popular teacher incentive programs will be endangered in states all across the nation.  As we begin the process to reauthorize the No Child Left Behind Act, such inaction on our part would be irresponsible.  Indeed, if we are intent on placing a high-quality teacher in every U.S. classroom, then we must be willing to support innovative, locally-driven concepts such as performance pay for teachers and principals. 

Later this week, we will introduce the Teacher Incentive Fund Act to authorize performance pay programs and make it a permanent and critical component of our nation’s teacher quality improvement strategy. 

Specifically, the legislation would establish the Teacher Incentive Fund to provide funds to states and local school districts to help them develop performance-based compensation systems that offer teachers and principals recognition pay for demonstrating progress in raising student achievement levels and closing the achievement gap.  Notably, no federally-designed performance pay system would be imposed upon states or schools.  Rather, the Teacher Incentive Fund Act simply would give states and local school districts – such as the schools in Rogers, Arkansas – the tools they need to design and implement systems that meet their unique needs.   

We urge you to join us in establishing recognition pay for teachers who are improving student achievement by co-sponsoring this bill.  For more information or to become a co-sponsor, please contact Brad Thomas with the Committee on Education and Labor at x5-6558 or Kris Skrzycki in Rep. Price’s office at x5-4501. 



   Tom Price (R-GA)


   Education and Labor Committee 


   Howard P. “Buck” McKeon (R-CA)

   Senior Republican Member

   Education and Labor Committee 


Arkansas Democrat-Gazette

Federal Funding Cut Figures to Rogers Merit Pay

By John Krupa

ROGERS - A federal funding cut threatens to scuttle the start of what could become Arkansas' largest merit-pay program. 

Congress eliminated nearly all funding last month in the current federal fiscal year for the U.S. Department of Education's Teacher Incentive Fund. 

Joint Funding Resolution 20, which set the Education Department's fiscal 2007 discretionary budget, dropped funding for the Teacher Incentive Fund to $200,000, from $99 million in fiscal 2006, which ended Sept. 30. 

Amanda Farris, deputy assistant secretary in the Education Department's Office of Elementary and Secondary Education, said the department doesn't have the money to cover more than a year's worth of payments to any current grantees or future applicants.

Rogers Superintendent Janie Darr said Thursday that her staff is trying to confirm the funding cut with federal officials.

Darr said it would be difficult for Rogers to sustain the program without a five-year federal commitment. She pledged previously not to commit any local dollars to the program.

"We'd have to rethink the whole thing," Darr said. "That would be very significant information." 

The Rogers School District is asking for $4.1 million spread over five years to support a local merit-pay program: about $1 million the first year and a combined $3 million in the following years.

The program would provide bonuses to about 325 teachers in 10 of Rogers 21 schools. The Walton Family Foundation pledged $2 million to support the program in conjunction with the federal grant. 

Bob Gettino, the Arkansas Education Associations' Northwest Arkansas representative, said it would be a mistake to implement the program without a five-year funding guarantee.

The district can't afford to default on promised payments down the road, he said. 

"The board would be wise to just say `never mind,'" he said. "I'm not sure it would be worth the headaches."  

The U.S. House of Representatives passed its spending bill Jan. 31, which allocated only $200,000 to the Teacher Incentive Fund. 

The Senate approved the measure Feb. 14 and President Bush signed the bill into law the next day. 

Overall, the act provided about $1 billion in new discretionary funds for the Education Department, officials said. It includes new money for special education, Pell grants for college students and the Head Start program for preschoolers. 

The department distributed $42 million to 16 merit-pay grant recipients in November. It accepted a second round of applications in February, including that of Rogers. 

Federal officials expect to announce 15 to 30 additional recipients by summer from a pool of 70 applicants. First-year funding for these applicants comes from the money left over from fiscal 2006. 

U.S. Secretary of Education Margaret Spellings wrote in a Feb. 8 letter that the fund will have only $8.8 million left to cover second-year funds for grantees. 

The first second-year payments are due in October. 

It would require about $240 million to fund the 16 original grants over their five-year lifetime. Department officials are lobbying Congress to restore at least $99 million in funding during fiscal year 2008. 

Farris said the department needs more than $200,000 before October to meet the round of second-year obligations. 

President Bush is calling for $199 million for the incentive fund during fiscal 2008. The Teacher Incentive Fund is one of his original No Child Left Behind initiatives. 

Restoring funding is also a "top priority" for U.S. Sen. Lamar Alexander, R-Tenn., said Jill Bader, Alexander's assistant press secretary. 

The Memphis City Schools, for example, received $3.1 million in the fall and were promised $13.8 million over five years. 

Alexander, in a Feb. 13 speech to the Senate, blamed the cuts on political pressure from the National Education Association, which represents 3 million teachers. 

The association sent a letter to senators asking them to vote down Alexander's amendment that would have restored funding to the Incentive Fund. 

"I want the world to know what they are against," said Alexander, a former U.S. secretary of education. "What they are against is helping find a fair way to pay good teachers more for teaching well."  

Joel Packer, an NEA spokesman, did not return calls for comment. 

Dan Marzoni, president of the Arkansas Education Association, an affiliate of the national group, said the incentive money would be better spent fully funding No Child Left Behind initiatives. 

"They've starved it from the beginning," Marzoni said. "So, I'm sorry, but this would make me pretty happy."

The development is not something that would be welcomed by hundreds of Rogers teachers, however.

Last fall, more than 85 percent of teachers in 10 of the district's 21 schools voted to pursue the application to the incentive fund.

One of the supporters has been Lelia Seratt, a second-grade teacher at Reagan Elementary School.

Seratt welcomed the plan because it would be entirely funded by outside sources. 

"I'm going to do the best job that I can whether I get any pay or not," said Seratt, who was hoping to use the bonus money to fund a family vacation. "What it does do is say that I'm appreciated."