idea, part b fiscal and results driven accountability

IDEA, Part B Fiscal and Results Driven Accountability

TIFFANY R. WINTERS, ESQ.

TWINTERS@BRUMAN.COM

JENNIFER MAUSKAPF, ESQ.

JMAUSKAPF@BRUMAN.COM

BRUSTEIN & MANASEVIT, PLLC

SPRING FORUM 2014

Agenda- OSEP Fiscal Monitoring Letters- Excess Costs- Maintenance of State Financial Support and

Maintenance of Effort- Supplement Not Supplant Requirements- Results Driven Accountability

BRUSTEIN & MANASEVIT, PLLC 2

OSEP Fiscal Monitoringhttp://www2.ed.gov/fund/data/report/idea/partbfymltrs/index.html

Reports with NO Findings Reports with Findings

1. Connecticut2. Guam3. Louisiana4. Missouri5. Nevada6. North Carolina7. North Dakota8. Pennsylvania9. Virginia10.West Virginia

1. District of Columbia2. Indiana (corrected)3. Mississippi4. Montana5. South Dakota6. Vermont7. Wyoming

Monitoring Area 1, IDEA Part B: Obligation/LiquidationCriterion Number

Description Applicable Requirements

Criterion 1.1

The SEA has procedures to allocate the IDEA section 611 and section 619 subgrants to eligible LEAs based upon the correct formula.

34 CFR §§300.200,300.705(a)-(b), 300.815-300.816

Criterion 1.2

The SEA has procedures to ensure that LEAs are provided 27 months to obligate funds.

34 CFR §76.709(a)

Criterion 1.3

The SEA has procedures to obligate funds solely during the 27 month period of availability and liquidate funds not later than 90 days after the end of the funding period or an extension of that timeline authorized by the Department.

34 CFR §§76.703,76.709, 80.23

Monitoring Area 1, IDEA Part B: Obligation/LiquidationCriterion Number

Criterion 1.4

The SEA has procedures to ensure that LEAs obligate funds solely during the 27 month period of availability and liquidate funds not later than 90 days after the end of the funding period or an extension of that timeline authorized by the Department.

34 CFR §§76.709,80.23

Criterion 1.5

The SEA has procedures to reallocate IDEA section 611 and section 619 subgrants, when appropriate, consistent with the regulations.

34 CFR §§300.705(c), 300.817

Criterion 1.6

The SEA has procedures to draw down funds based on immediate needs; any interest accrued by the SEA or LEAs in excess of $100 per year per account is returned to the Department.

34 CFR §80.21(c)&(i)

Monitoring Area 1, IDEA Part B: Obligation/Liquidation

Findings: 1. (Mississippi) State reallocated unspent LEA funds without determining that a FAPE was provided by the district and whether the LEAs that received the reallocation were adequately providing special education and related services. (300.705(c) and 300.817).

2. (Wyoming) State reallocated unspent LEA funds without determining that a FAPE was provided by the district and whether the LEAs that received the reallocation were adequately providing special education and related services. (300.705(c) and 300.817).

Monitoring Area 2, IDEA Part B: Use of FundsCriterion Number

Criterion 2.1

The SEA has procedures to ensure that funds are expended in accordance with the requirements of the IDEA Part B.

34 CFR §§300.162(a), 300.202(a)(1)

Criterion 2.2

The SEA has procedures to ensure that LEAs use IDEA funds only to pay the excess costs of providing special education and related services to children with disabilities in accordance with IDEA.

34 CFR §§300.16, 300.202(a)(2)

Criterion 2.3

The SEA has procedures to ensure that LEAs spend the required amount on providing special education and related services to parentally-placed private school children with disabilities.

34 CFR §300.133

Monitoring Area 2, IDEA Part B: Use of FundsCriterion Number

Criterion 2.4

The SEA has procedures to provide an approved restricted indirect cost rate (RICR) for its LEAs.

34 CFR §§76.560-76.569

Criterion 2.5

The SEA has procedures to provide IDEA funds to LEA charter schools in accordance with IDEA and EDGAR.

34 CFR §§76.788-76.797, 300.209(c), 300.705(a) and (b), 300.815-300.816

Criterion 2.6

The SEA has procedures to ensure that each LEA provides funds to charter schools that are part of the LEA in the same manner it provides funds to its other schools.

34 CFR §§76.799, 300.209(b)

Monitoring Area 2, IDEA Part B: Use of Funds

Findings: 1. (District of Columbia) SEA had no procedures to ensure that LEAs use IDEA funds only to pay the excess costs; SEA did not compute excess cost.

2. (Mississippi) SEA’s excess cost computation was inconsistent with IDEA regulations by looking at CWD count from preceding year rather than current year.

3. (Montana) SEA had no procedures to ensure that LEAs use IDEA funds only to pay the excess costs; SEA did not compute excess cost.

4. (South Dakota) SEA had no procedures to ensure that LEAs use IDEA funds only to pay the excess costs; SEA did not compute excess cost.

5. (Wyoming) SEA had no procedures to ensure that LEAs use IDEA funds only to pay the excess costs; SEA did not compute excess cost.

Monitoring Area 3, IDEA Part B: ARRACriterion Number

Criterion 3.1

The SEA ensures that infrastructure investments are properly certified and posted.

ARRA §1511

Criterion 3.2

The SEA has procedures to ensure that LEAs comply with the “Buy American” requirements.

2 CFR §§176.60-176.170

Criterion 3.3

The SEA has procedures to ensure that LEAs comply with the prevailing wage requirements.

2 CFR §§176.180, 176.190

Criterion 3.4

The SEA has procedures to ensure that it prevents and detects fraud, waste, and abuse.

Inspector General Act of 1987 (P.L. 100-504)

Monitoring Area 3, IDEA Part B: ARRA

Findings: None.

Monitoring Area 4, IDEA Part B: Level of EffortCriterion Number

Criterion 4.1

The State has procedures to calculate its financial support for special education and related services for children with disabilities in accordance with the IDEA.

34 CFR §300.163(a)

Criterion 4.2

The SEA has procedures to ensure that each LEA budgets, for the education of children with disabilities, at least the same amount as the LEA spent for that purpose in the most recent prior year for which information is available.

34 CFR §300.203(b)

Criterion 4.3

The SEA has procedures to ensure that each LEA expends at least the same amount as it expended in the immediate prior year for the education of children with disabilities, unless the LEA has allowable exceptions or adjustments.

34 CFR §§300.203(a), 300.204-300.205

Criterion 4.4

The SEA’s procedures for reviewing LEA MOE consider each of the following ways to calculate MOE: total local funds; per capita local funds; total local and State funds; or per capita local and State funds. The SEA’s procedures for reviewing LEA MOE find an LEA to have met MOE if the LEA met MOE based on one or more of those comparisons.

34 CFR §300.203(b)

Monitoring Area 4, IDEA Part B: Level of Effort

Findings: 1. (District of Columbia) State MFS did not include all special education costs (non-public tuition for students with IEPs in non-public settings at public expense; transportation for students with IEPs; and certain other state agency costs).

2. (Indiana) State MFS did not include funds from other state agencies.

3. (Mississippi) State MFS did not include funds from other state agencies.

4. (Vermont) State did not ensure LEAs were meeting the MOE eligibility standard.

Monitoring Area 5, IDEA Part B: Procurement, Property, and Record Retention

Criterion Number

Criterion 5.1

The SEA obtains approval from the Department prior to using its State-level IDEA funds for equipment, construction, or alteration of facilities.

34 CFR §300.718

Criterion 5.2

The SEA has procedures to ensure that an LEA obtains its approval prior to using IDEA funds for equipment, construction, or alteration of facilities.

34 CFR §300.718

Criterion 5.3

The SEA has procedures to ensure that its procurement mechanisms, and those used by its LEAs, conform to applicable Federal law and State procurement rules.

34 CFR §80.36

Monitoring Area 5, IDEA Part B: Procurement, Property, and Record Retention

Criterion Number

Criterion 5.4

The SEA has procedures to ensure that each LEA maintains a physical inventory of property acquired with IDEA funds and conducts inventories to reconcile with property records at least once every two years.

34 CFR §80.32(d)(2)

Criterion 5.5

The SEA has procedures to ensure that it, and its LEAs, do not award or obligate funds to any party that has been debarred or suspended.

34 CFR §80.35

Criterion 5.6

The SEA has procedures to ensure it, and its LEAs, maintain financial and programmatic records for the period of time required by Federal law.

34 CFR §80.42

Monitoring Area 5, IDEA Part B: Procurement, Property and Record Retention

Findings: None.

Excess Cost

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Excess Cost Requirement

What is an Excess Cost? Costs in excess of the average annual per-student expenditures in an LEA during the preceding school year for an elementary school or secondary school student, as may be appropriate, and that must be computed after deducting amounts received under –◦ IDEA Part B;◦ Title I, Part A ESEA; ◦ Title III, Parts A and B of the ESEA; ◦ Any State or local funds expended for programs that would

qualify for assistance under any of the grant programs described above; and

◦ Capital outlay or debt services.

(IDEA Regs Section 300.16)

How to Calculate Excess Costs?

Four Steps: Step 1:

LEA must determine total amount of expenditures for elementary school students from all sources-local, State and federal (including Part B)-in the proceeding school year.

◦ (Less Capital outlay and debt services)

State and Local tax

Funds+ Federal

Funds – Capital Outlays and Debt =

Total Expenditures Less Capital

Outlays and Debt

Step 2: ◦ Subtract from the total expenditures less capital outlays

and debt: ◦ IDEA Part B;◦ Title I, Part A ESEA; ◦ Title III, Parts A and B of the ESEA; and◦ Any State or local funds expended for programs that

would qualify for assistance under any of the grant programs described above

=Total expenditures less capital outlay and debt, minus deductions

Step 3: Determine the average annual student expenditure:

(total expenditures less capital outlay and debt minus deductions) / (average number of

students)= Average annual student per

expenditures

Step 4: Determine the total minimum amount of funds the LEA must spend for the education of its elementary school children with disabilities (not including capital outlay debt service):

(Number of children with disabilities in LEA elementary schools)

X (average annual per student

expenditure)

= (Total minimum amount LEA must

spend for education of children with disabilities before using part B funds)

SEA Exceptions SEA providing direct services to children with disabilities to make FAPE available:◦ May use Part B funds from State set aside OR Part B payments that

would have otherwise been available to an LEA for the purpose of serving those children

◦ Does not need to comply with excess cost requirement

(IDEA Regs Sections 300.175, 300.227(a)(2)(ii))

Reallocation of Funds to LEAs

LEA Reallocation If a State determines:

That an LEA is adequately providing FAPE to all children with disabilities residing in the area served by the LEA with State and local funds,

Then the State MAY reallocate any portion of the funds under this part not needed by the LEA to provide FAPE to other LEAs in the State that are not adequately providing special education and related services to all children with disabilities residing in the areas served by those LEAs.

(IDEA Regs Sections 300.705(c) and 300.817).

Maintenance of State Financial Support and Maintenance of Effort

WHAT???WHAT???

KEEP IT UP!KEEP IT UP!

Maintenance of State Financial Support (MFS)

A State must not reduce the amount of State financial support for special education and related services for children with disabilities below the amount of that support for the preceding fiscal year.◦ Includes ALL State funds!!

(IDEA Regs Section 300.163)

Failure to Meet State MFS

Consequences for failure to maintain support:◦ ED reduces allocation for any FY following the FY in which

the State fails to comply.

◦ Reduction is the same amount by which the State fails to meet the requirement.

◦ Following year reverts back to previous level of effort

Ability of SEA to reduce its MOE is VERY RARE! (IDEA Regs Section 300.230)

Local-level Maintenance of Effort (MOE)

An LEA may not use its Part B funds to reduce the level of expenditures for the education of children with disabilities made by the LEA from local funds below the level of those expenditures for the preceding fiscal year.

(IDEA Regs Section 300.203(a))

Local-level MOE (cont.) For eligibility purposes: LEA must budget, for the education of CWDs, at least the same total or per capita amount from either local funds only or state and local funds as the LEA spent for that purpose for the same source for the most recent prior year for which information is available

(IDEA Regs Section 300.203(b)(1))

NPRM* – 300.203(a) Compliance standard. An LEA meets this standard if it does not:◦ Reduce from State and local, in total or per capita, below

preceding fiscal year;◦ Reduce from local, in total or per capita, below the year for which

LEA met MOE standard based on local only; or◦ Reduce from local, in total or per capita, below preceding fiscal

year if the LEA has not previously met the MOE compliance standard based on local funds only

** The NPRM comment period was extended until December 10, 2014 (bc of the Gov’t shutdown). Final regulations expected around June 2014??

NPRM – 300.203(b) Eligibility standard. The amount of local funds an LEA budgets for CWDs is at least the same, in total or per capita, as the amount it spent for that purpose in the most recent fiscal year for which information is available and the LEA met MOE compliance standard based on local funds only ◦ If an LEA has not previously met MOE based on local

funds only, then budget the amount spent from local funds in the most recent fiscal year for which information is available

NPRM – 300.203(c)

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NPRM – 300.203(d) Consequence of failure to maintain effort. If LEA fails to meet MOE, the SEA is liable in a recovery action to return to ED, using non-federal funds, an amount equal to the amount by which the LEA failed to maintain its level of expenditures.

Supplement not

Supplant

SEA Supplement Not Supplant (SNS)

•Part B funds must be used to supplement and increase the level of Federal, State and local funds expended for special education and related services provided to children with disabilities, and in no case supplant those Federal, State and local funds.

•A State may use State admin and other State-level activities without regard to the prohibition on supplanting

(IDEA Regs Section 300.162; 300.704(d))

LEA SNS• Part B funds must be used to supplement State, local

and other Federal funds (used for providing services to children with disabilities). 34 CFR 300.202.

• If LEA meets MOE, then LEA meets supplement not supplant requirements

• No particular cost test • ARRA Guidance, April 2009

OMB Circular A-133 Compliance Supplement

Auditors presume supplanting occurs if federal funds were used to provide services** . . .1.Required to be made available under other federal, State, or local laws2.Paid for with non-federal funds in prior year3.Same service to non-Title I students with State/local funds

**Note that the 2013 Compliance Supplement states that these provisions do not apply to IDEA!

LEA SNS (cont.)

LEA SNS OSEP Policy letter

MN DOE, January 30, 2013◦ “The district would be required to demonstrate that the

Federal IDEA, Part B funds they are requesting to be used for CEIS supplement and do not supplant existing State, local and other federal funds, including ESEA funds, the district is using for [its program].”

This directly contradicts the “notwithstanding” language in IDEA Regs Section 300.208.

CEIS and SNS

CEIS must supplement any ESEA activities or services. (IDEA Regs Section 300.226(e)

Model example:1. CEIS and local funds serve total population – CEIS

for eligible CEIS students2. Title I provides Response to Intervention to Title

I students and CEIS supplements

SNS (cont.)

Results Driven Accountability

IDEA Monitoring•U.S. Department of Education Office of Special Education Programs (OSEP) monitors States’ implementation of IDEA Parts B and C

•States monitor local educational agencies’ (LEAs) implementation of Part B and early intervention services (EIS) programs’ implementation of Part C

Monitoring Priorities

OSEP’s Vision for RDA All components of an accountability system will be aligned in a manner that best support States in improving results for infants, toddlers, children and youth with disabilities, and their families.

OSEP’s RDA Website: http://www2.ed.gov/about/offices/list/osers/osep/rda/index.html

Components of RDA•State Performance Plan / Annual Performance Report (SPP/APR) measures results and compliance.

•Determinations reflect State performance on results, as well as compliance.

•Differentiated monitoring and technical assistance support improvement in all States, but especially low performing States.

Proposed SPP/APR Focus on Systemic Improvement•“Aligned with RDA Vision and Goals”•Reduction of Reporting Burden• Combines SPP and APR into one document• Collects SPP/APR data through a web-based, on-

line submission process (GRADS)

State Systemic Improvement Plan (SSIP)•Comprehensive, multi-year SSIP, focused on improving results for children with disabilities• Instead of multiple small improvement plans for each

indicator• Broad strategies with detailed improvement activities

•New Indicator 17

•Multi-year, multi-phase process, beginning with FFY 2013 APR (submitted in 2015)

SSIP Phase 1•Submitted in 2015 with FFY 2013 SPP/APR•Components of Phase I:•Data Analysis• Identification of Focus for Improvement• Infrastructure to Support Improvement and Build

Capacity• Theory of Action (If X then Y)

SSIP Phases 2 & 3•Phase 2 (submitted in 2016 with FFY 2014 SPP/APR)• Infrastructure Development• Support for LEA/EIS Program Implementation of Evidence-Based

Practices • Evaluation Plan

•Phase 3 (submitted in 2017 with FFY 2015 SPP/APR)• Results of ongoing evaluation of strategies in the SSIP• Extent of implementation of strategies• Progress toward established goals• Any revisions made to the SSIP in response to the evaluation

Determinations, 2012-2014•OSEP working to revise determination process to be more results focused.• 2012: Determinations were driven by

compliance indicators• 2013: Began to use compliance data in

determinations, issuance of ‘Compliance Matrix’ • 2014: OSEP will use results data in

determinations in 2014

Differentiated Monitoring and Support•Based on determinations and SSIP

•All States to receive TA on SSIP development and general TA

•States with the greatest needs will receive more intensive support

•OSEP piloting collaborative efforts in connection with SIG visits

Accountability for Compliance•Review of compliance indicators in SPP/APR

•Ongoing fiscal monitoring and audit resolution

•OSEP TA in key areas

•OSEP Desk Audit Process• To be conducted for every State over next four years• To include State accountability, dispute resolution, and data

quality• OSEP reserving option to conduct on-site reviews where

necessary to collect additional data / provide technical support

Questions??

DisclaimerThis presentation is intended solely to provide general information and does not constitute legal advice. Attendance at the presentation or later review of these printed materials does not create an attorney-client relationship with Brustein & Manasevit, PLLC. You should not take any action based upon any information in this presentation without first consulting legal counsel familiar with your particular circumstances.

idea, part b fiscal and results driven accountability

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