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What to do when your ESSER funds expire

May 15, 2024

What to do when your ESSER funds expire

For many K-12 schools, ESSER funds were a lifeline during the COVID-19 pandemic. The financial assistance they provided was essential as schools were navigating the complexities of operating during a time of uncertainty and disruption. 

Now, with the pandemic no longer looming, ESSER funds are coming to their expiration date. That means schools must find ways to make up for the financial assistance those critical funds provided. 

What are ESSER funds?

ESSER funds, also known as Elementary and Secondary School Emergency Relief funds, were created during the 2020 pandemic as part of the Coronavirus Aid, Relief, and Economic Security Act (CARES Act) to provide financial relief to K-12 schools across the country. 

The funds supported safety of students and staff, remote learning capabilities, mental health needs, and addressing pandemic-related learning loss. In total, there were three rounds of funding totalling nearly $200 billion, providing a huge help to schools, however the third and final round of funds are about to expire and must be obligated by September 30, 2024.

With the expiration of ESSER funds around the corner and the money they provide accounting “for a significant share of current education dollars,” K-12 schools must identify ways to bridge the looming financial gap or they could be at risk for layoffs, closures, and loss of student programming.

How can school districts make up for expiring ESSER funds?

The question about how to bridge the financial gap left by expiring ESSER funds is top of mind for school district leaders, including the director of business services and operations for the Parkrose school district in Oregon. The district “anticipates a $1.6 million shortfall next school year after ESSER runs out” and hasn’t identified a way to replace it.

While it will take many different sources to replace the money ESSER funds provided, according to a survey of 250 district leaders by the EdWeek Research Center, “roughly 1 in 5 said they’ll tap into funds from private donors” to pay for things in the future that had been previously funded through ESSER funds.

Can school districts use fundraising to replace ESSER funds? 

Fundraising dollars have long been used to help schools provide students with memorable and enriching experiences and may prove to be a lifeline for many facing a fiscal cliff with the expiration of ESSER funds. 

For many school districts, the number of fundraisers necessary to supplement the budget could grow. That means school districts have no time to waste around creating a structure for oversight of fundraising activities and transparency into the flow of funds at the unit level.

What makes fundraising challenging for school districts?

Risk of fraud, waste, and abuse

According to a Knox County, Tennessee school district leader, fundraising in the district can be challenging because of the risk of fraud, waste, and abuse. This is especially true for school crowdfunding campaigns, which have exploded in popularity in recent years. Designing policies that provide the district with oversight into the flow of fundraising dollars is the first step toward gaining oversight. 

Paperwork and manual processes

In Hamilton County, Tennessee, School Accounting Supervisor Angie Nye said schools are required to get a fundraiser number from a bookkeeper in order to submit the appropriate paperwork for approval. In the past, that process was paper driven and manual, relying on people spending too much precious time chasing paperwork. 

This is a very common issue for school districts everywhere, and with the threat of fewer resources available with the expiration of ESSER funds, the need for more efficiencies wherever possible is more pressing than ever. 

High volume of requests

Large districts can receive thousands of fundraiser requests each school year and without efficient workflows, the approval process can be prohibitive. For example, Knox County school district has 5,000 fundraiser requests annually. Without an automated workflow, approvals were so delayed that often fundraisers would run without having received approval.

How can fundraising software for school districts help?

Fortunately, fundraising software is designed to address these types of challenges and make it much easier and efficient for school districts to manage fundraisers. By leveraging technology to optimize resource allocation and streamline administrative processes, school districts can save time and money.

Reducing risk and gaining oversight

Reducing the risk isn’t as complicated as you might think, especially with fundraising software that gives district leaders oversight and ensures compliance. Being able to approve fundraisers and track the money they raise in a simple platform provides school districts with a powerful tool that protects them from missing fraudulent fundraising activities in their units.

An added bonus of gaining oversight into the fundraising and crowdfunding going on within your school district is being able to use the data and information you gain to help shape policy and make recommendations to the school board.

Creating efficiencies with automated workflows

Transitioning to a digitally-based fundraising approval workflow means everything is tracked and there’s no time spent chasing paper. In the Metro Nashville school district in Tennessee, the efficiencies that resulted in moving to an automated workflow allowed bookkeepers to be removed from the process. It was a huge boost to efficiency, saving time, maximizing district resources, and reducing miscommunication and frustration with the process.

Adding accountability

After Hamilton County implemented fundraising software in their school district, they found that the new approval process they instituted made teachers more accountable to the fundraisers they were proposing, which led to a more deliberate approach. It also reduced what had been an excessive number of fundraisers and crowdfunding campaigns.

What to do before ESSER funds expire

There are a number of actions school districts should take before ESSER funds expire on September 30 in order to help reduce the resulting budget shortfall. Proactively planning to adapt to these changes will go a long way toward making sure the needs of students and staff continue to be met. Start by:

  • Obligating any remaining funds you have an applying for an extension to use them if needed
  • Identifying multiple different resources that can be used to replace ESSER funds
  • Implementing a fundraising software platform to make managing fundraisers easier and less onerous for your district
  • Leveraging technology to create efficiencies in processes and workflows

Find out how Givebacks can help you gain oversight into fundraising and crowdfunding in your school district.