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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

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IDEA, Part B Fiscal and Results Driven Accountability

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  1. 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

  2. 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

  3. OSEP Fiscal Monitoringhttp://www2.ed.gov/fund/data/report/idea/partbfymltrs/index.html Brustein & Manasevit, PLLC

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  6. 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). Brustein & Manasevit, PLLC

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  9. 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. Brustein & Manasevit, PLLC

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  11. Monitoring Area 3, IDEA Part B: ARRA • Findings: • None. Brustein & Manasevit, PLLC

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  13. 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. Brustein & Manasevit, PLLC

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  16. Monitoring Area 5, IDEA Part B: Procurement, Property and Record Retention • Findings: • None. Brustein & Manasevit, PLLC

  17. Excess Cost Brustein & Manasevit, PLLC

  18. Excess Cost Requirement • The excess cost requirement prevents an LEA from using funds provided under Part B of the Act to pay for all of the costs directly attributable to the education of a child with a disability. • Exception: Children with disabilities ages 3-5 and 18-21 if local or State funds are not available. (IDEA Regs Section 300.202(b)(1)) Brustein & Manasevit, PLLC

  19. 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) Brustein & Manasevit, PLLC

  20. How to Calculate Excess Costs? • Calculate elementary school students separately from secondary school students. • (IDEA Regs Section 300.16) Brustein & Manasevit, PLLC

  21. 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) Brustein & Manasevit, PLLC

  22. 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 Brustein & Manasevit, PLLC

  23. Step 3: • Determine the average annual student expenditure: Brustein & Manasevit, PLLC

  24. 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): Brustein & Manasevit, PLLC

  25. 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 RegsSections 300.175, 300.227(a)(2)(ii)) Brustein & Manasevit, PLLC

  26. Reallocation of Funds to LEAs Brustein & Manasevit, PLLC

  27. 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 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). Brustein & Manasevit, PLLC

  28. Maintenance of State Financial Support and Maintenance of Effort What??? Keep It Up! Brustein & Manasevit, PLLC

  29. 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) Brustein & Manasevit, PLLC

  30. 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) Brustein & Manasevit, PLLC

  31. 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)) Brustein & Manasevit, PLLC

  32. 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)) Brustein & Manasevit, PLLC

  33. 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?? Brustein & Manasevit, PLLC

  34. 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 Brustein & Manasevit, PLLC

  35. NPRM – 300.203(c) • Subsequent years. If LEA fails to meet MOE, level of expenditures required is the amount that would have been required in the absence of that failure and not the LEA’s reduced level of expenditures. • Initially stated in the BoundyLetter (April 2012), overturning East letter (June 2011) • However, this is current law (even without the final rulemaking!) Because language was included in H.R. 3547, the Consolidated Appropriations Act, 2014, 113th Cong. (2nd Sess. 2014). Brustein & Manasevit, PLLC

  36. 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. Brustein & Manasevit, PLLC

  37. Supplement not Supplant Brustein & Manasevit, PLLC

  38. 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)) Brustein & Manasevit, PLLC

  39. 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 Brustein & Manasevit, PLLC

  40. OMB Circular A-133 Compliance Supplement Auditors presume supplanting occurs if federal funds were used to provide services** . . . • Required to be made available under other federal, State, or local laws • Paid for with non-federal funds in prior year • 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! Brustein & Manasevit, PLLC

  41. LEA SNS(cont.) • Notwithstanding 300.202 (SNS), 300.203 (MOE), and 300.162 (Commingling), funds provided to an LEA may be used for: • Services and aids that also benefit nondisabled children • Early intervening services • High cost special education and related services (IDEA Regs Section 300.208) Brustein & Manasevit, PLLC

  42. LEA SNSOSEP 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 RegsSection 300.208. Brustein & Manasevit, PLLC

  43. CEIS and SNS • CEIS must supplement any ESEA activities or services. (IDEA Regs Section 300.226(e) • Model example: • CEIS and local funds serve total population – CEIS for eligible CEIS students • Title I provides Response to Intervention to Title I students and CEIS supplements Brustein & Manasevit, PLLC

  44. SNS (cont.) Brustein & Manasevit, PLLC

  45. Results Driven Accountability Brustein & Manasevit, PLLC

  46. 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 Brustein & Manasevit, PLLC

  47. Monitoring Priorities • “The primary focus of Federal and State monitoring activities shall be on – • Improving educational results and functional outcomes for all children with disabilities; and • Ensuring that States meet the program requirements under this part with a particular emphasis on those that are closely related to improving education results for children with disabilities.” IDEA Sec. 616(a)(2) Brustein & Manasevit, PLLC

  48. 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 Brustein & Manasevit, PLLC

  49. 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. Brustein & Manasevit, PLLC

  50. 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) Brustein & Manasevit, PLLC

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