“Obviously we’re seeing extraordinary reform at the state level,” said U.S. Secretary of Education Arne Duncan. “We would love to see that kind of innovation continue at the district level.”

Duncan said that a $900 million funding level would permit only one or two winners if RTTT focused on states, but it could reach more innovative programs and ideas at the district level. The funding boost also would extend the program to districts that supported RTTT but were located within states that opted not to apply for a share of the funding last year.

“We need to invest in education … in a responsible way that keeps our country on a path to financial stability,” Duncan said during a conference call with reporters. “We must cut where we can to invest where we must.”

“We are pleased that the budget proposes a modest increase for IDEA. It also seeks to broaden eligibility for Race to the Top grants by driving resources directly to local school districts instead of states,” said Randi Weingarten, president of the American Federation of Teachers. “In these difficult times, when districts are wrestling with the prospect of cutting art, music, and vital services for kids, we must be careful to maintain those priorities. Funding determined by competition sometimes allows those districts who can most afford it to have an edge, and that is troubling when all students—particularly disadvantaged children—need help.”

Duncan said ED will strive to recruit future teachers into hard-to-serve schools, along with funding recruitment and development of science, technology, engineering, and mathematics (STEM) teachers.

Obama says his budget proposal reflects a need to start reducing deficits, but not at the expense of programs he says deserves more money.