Senate approves jobs bill to stop teacher layoffs

"Washington needs to take care of its own fiscal mess, not deepen it by bailing out the states," said Senate Minority Leader Mitch McConnell (R-Ky.). "Americans . . . are alarmed at the fact that the federal government is now for the first time in our history the single largest source of revenue for the states. They know that with more power in Washington comes less accountability. And they're fighting back."

The measure would extend programs enacted in last year's economic stimulus package, giving states an extra $10 billion for education programs and $16 billion to plug holes in their budgets opened by growing demand for Medicaid, the government-run health program for the poor.

To pay for the new spending, the measure would cut off in March 2014 an expansion of food-stamp benefits enacted in last year's stimulus. And it would end tax breaks for some multinational corporations that are based in the United States but have operations and pay taxes abroad. Closing those "loopholes," as Democrats call them, is the centerpiece of a House Democratic campaign to promote domestic manufacturing and discourage companies from shipping jobs overseas.

The U.S. Education Department estimates that the education fund would preserve the jobs of about 160,000 teachers and other educators. California is projected to receive the most funding, an estimated $1.2 billion to preserve about 16,500 jobs. Locally, the District would receive about $18 million, saving 200 jobs. Maryland is slated to get $179 million for about 2,500 jobs, and Virginia would get $249.5 million for 3,800 jobs, according to education officials.

Officials in Maryland, Virginia and the District declined to comment on how such funds would affect their budgets, saying it was too early in the process to accurately make predictions.

Education Secretary Arne Duncan said the money would go to school boards across the country to forestall teacher layoffs, cuts to after-school programs, increases in class sizes and, in a few cases, plans to shorten the school week from five days to four.

"The stories that we were hearing were absolutely scary," Duncan said in an interview. "We couldn't in good conscience not work to make it happen."

State officials say the aid will spare them from laying off thousands of other workers. States face a cumulative budget gap of $62 billion for the current fiscal year, said Brian Sigritz, director of state fiscal studies for the National Association of State Budget Officers. At $26 billion, the package "might not be enough to solve all of the shortfalls," he said. "But it will be a tremendous help."

Staff writer Michael Fletcher contributed to this report.