Special Education Funding

Special Education FundingEducation Service Center, Region 20Sherry Marshsherry.marsh@esc20.net1

Supplement/Not SupplantUnder IDEA, Section 613 (a)(2)(ii) (34 CFR 300.202(a)(3)), Part B funds must be used to supplement state, local, and other Federal funds used for providing services to children with disabilities. Prior to 1992, the Part B regulations included a "particular cost test" for determining whether supplanting had occurred. For example, if an LEA spent Part B funds to pay for a teacher's salary that was previously paid for with state and local funds, a supplanting violation had occurred. This "particular cost test" was removed from the regulations by an amendment published on August 19, 1992 (37 FR 37652) and that became effective on October 3, 1992. No requirement currently exists related to supplanting "particular costs." If an LEA maintains local, or state and local, effort, it will not violate the supplement/not supplant requirements of the IDEA.

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So What?As long as the LEA maintains or exceeds its level of local OR state and local expenditures for special education and related services from year to year, either in total or per capita, then the Part B funds are, supplementing those local, or state and local expenditures and the LEA has met both its MOE and its supplement/not supplant requirements.

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IDEA-B Allowable ExpendituresCost items that are used by all students should not be funded with Part B funds. For example, software curriculum that is used by all students should not be funded with Part B funds. Only supplemental software required by students with disabilities is allowable with Part B funds. Part B funds may be used for the costs of special education and related services, and supplementary aids and services, provided in a regular classroom or other education-related setting to a child with a disability in accordance with the IEP of the child, even if one or more nondisabled children benefit from these services. 34 CFR 300.208(a)(1).For a complete list of allowable expenditures, please review your eGrant Program Guidelines (Pages 39-81)4

So, what about excess costs? 34 CFR 300.202(b)(1) stipulates that Part B funds must not be used to pay all of the costs directly attributable to the education of a child with a disability.

An LEA meets the excess cost requirement if it has spent at least a minimum average amount for the education of its children with disabilities before funds under Part B of the Act are used. (CFR 300.202(b)(2)(i))

An excess cost calculator (excel spreadsheet) is at: http://portal.esc20.net/portal/page/portal/esc20public/SpecialEducation/ComplianceFundingIssues

The LEA should calculate the excess cost based on previous year expenditures before applying for the new year's Part B entitlement.

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Where does MOE come in?After meeting excess cost requirements, LEAs must also meet the MOE requirements from year to year34 CFR 300.203 requires that each LEA receiving IDEA-B funds maintain fiscal effort from its local and state funds to support students with disabilitiesThis state and local effort should be the amount it takes to provide core special education services if federal funds were not available

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7Requirements Use of Funds

FederalSpecial Education Funds

StateSpecial Education Block Grant

FoundationSchool Program(FSP)

And

Local Funds

Maintenance of Effort (34 CFR 300.203)

Excess cost of serving students with disabilities (34 CFR 300.202)

Coordinated early intervening services (CEIS)(34 CFR 300.226 )Services over/above what is funded with state/local fundsAt least 55% must be spent for services for students with disabilities (TEC 42.151(h), TAC 89.1125 and TAC 105.11) Generated by all students enrolled in the district (TEC 42.003)Special services, materials, supplies, and equipment directly related to the development and implementation of IEPs, not ordinarily purchased for the regular classroom. Services, materials, supplies, and equipment provided to all students

7Of course, in the real world these are all spent simultaneously. The LEA just has to be sure that the special education funds are spent only for special services above and beyond those required for students not enrolled in special education.

Up the left hand side you will see that maintenance of effort runs through all of them. While we will mention MOE in this module, there is another whole module developed on that topic, so we will not cover it in detail in this presentation.

State Special Education IDCNovember 2009, the SBOE adopted a 45% indirect cost (IDC) rate for the state special programs (special education, gifted and talented and bilingual) and 40% for career and technology.However, no matter what the IDC rate, districts will still need to maintain fiscal effort of direct services with State and Local funds. So, districts will have to make up the increased percentage that goes toward indirect costs from another local fund source.

Please note, the indirect cost rate for IDEA-B remains at the federal restricted indirect cost rate, or 8%, whichever is less.

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MidYearRemindersSpecial Education Maintenance of Effort

PEIMS EDIT+ Turnaround Reports

PRF3D022 Special Education Maintenance of Effort (MOE)This report parallels the Maintenance of Effort report produced by the Special Education Division of TEA. It is used to ensure that school districts comply with the MOE requirements of the Individuals with Disabilities Education Act (IDEA). The report gives districts an early indication of their compliance or non-compliance with MOE so that districts can take action either to correct erroneous data or to prepare the necessary documentation. See the PRF3D022 Addendum for information about algorithm rules and rules for determining compliancy.

Note 1: This report is available only: (1) after 1st Submission is closed and no extensions are outstanding OR (2) in an Approved collection.9

Where does the data come from?PEIMS SubmissionsPEIMS Midyear SubmissionRecord 032Record 033PEIMS Summer SubmissionRecord 163Fund CodeDistricts-199; Charters-Net Asset Code 420; SSA-437 Only For FY 2010 & 2011 fund 266 or 366 (SSA) will be used Program Intent CodesPIC 23 vs. PIC 99Function Codes11, 12, 13, 21, 23, 31, 32, 33, 34, 36, 41, 51, 53

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School finance codesAn Administrators Guide To11

PRF3D022: Special Education Maintenance of Effort

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12/7/201012

Special Education Maintenance of Effort MOE Lines 1 and 2The Actual Allocation Process references the following:OBJECT CODE 6xxxxFUNCTION CODE = 11, 12, 13, 21, 23, 31, 32, 33FUNCTION CODE = 34, 36, 41, 51, 53FUND CODE = 199, 420Special Ed MOE Process limits the data where PROGRAM CODE = 23Shared Service ArrangementsSSA TYPE CODE = 11FUND CODE = 437 FISCAL_DISTRICT_ID = District Requested Amount attributed is reported by the fiscal agent for districts on the 033 record.

Charter schools will have reported direct expenditures on 032 record per information provided by fiscal agent.

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12/7/201013

Special Education Maintenance of Effort MOE Lines 4 and 6PEIMS data related to 08-09 figures:PEIMS collection : MidYear 09-10 (actual 08-09 audit report)

Line 4: - Prior Year Count of Special Education Students : Fall 07-08 collection reference PRF5D010 for total Special Education Child/Counts (equals total number of Fall PEIMS 163 Special Education enrollment records reported).

Line 6: - Current Year Count of Special Education Students : Fall 08-09 collection (reference PRF5D010 for total Special Education Child/Counts (equals total number of Fall PEIMS 163 Special Education enrollment records reported).

For a roster of students in each collection reference PRF5D027 Special Education Roster by Grade.

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ExceptionsThe voluntary departure, by retirement or otherwise, or departure for just cause, of special education personnelRIF/transfer of employee to non-special ed. role does not qualifyPosition does NOT have to be replacedA decrease in the enrollment of children with disabilitiesThe termination of the obligation of the LEA to provide a program of special education to a particular child with a disability that is exceptionally costly (TAA Letter Coming!)The termination of costly expenditures for long-term purchases, such as acquisition of equipment or the construction of school facilities (Capital Outlay Expenditures)The assumption of cost by the high cost fund15

Exceptions & Documentation

LEAs may adjust MOE Baseline with proper documentation related to each of the exceptions

If found out of compliance TEA will request submission of this documentation

TEA Forms D-G:http://www.tea.state.tx.us/index4.aspx?id=4073 16

FOR MORE INFORMATION, PLEASE CONTACT:SPECIAL EDUCATION FUNDING:

Sherry Marsh210-370-5411sherry.marsh@esc20.netPEIMS SUPPORT:

Judi Sparks210-370-5322judi.sparks@esc20.net

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