Maintenance of Effort IV-B Funding LEA Level Special Education Services Kansas Department of Education Special Education Services

MOE Background  IDEA requires the LEA to maintain local effort  The amount of local, or State and local, funds expended for the education of children with disabilities is the amount of funds that establishes the level of expenditures to be maintained from year to year and establishes the MOE level  Not to “reduce the level of expenditures for the education of children with disabilities below the level of those expenditures for the preceding fiscal year” 34 CFR § (a) Special Education Services

What is MOE?  MOE – Maintenance of Fiscal Effort  Met or satisfied through 4 different tests  Only concerned with expenditures  Some exceptions are allowed  So MOE can be different than what was expended  Target  Based on expenditures  Compliance  Eligibility  Part of Budgeting Process Special Education Services

4 Tests to Meet MOE  Total of State and Local Funds  State and Local Funds per Student Level  Total Local Funds  Local Funds per Student Level  Student = special education student  Tests used to analyze “expenditures for the preceding fiscal year” (34 CFR § (a))  The same test is used each year Special Education Services

MOE is an Issue of Compliance and Eligibility  Compliance:  Spend at least the same amount as expended the preceding fiscal year (34 CFR § (a))  LEA expends $900,000 in FY and expends $950,000 in FY ; therefore, the LEA complied with the MOE requirement from FY to FY  Eligibility:  Must budget at least the same amount for the following year (34 CFR § (b))  LEA expends $950,000 in FY and budgets $1,000,000 in FY ; therefore, the LEA meets the IDEA MOE eligibility requirement for an FY grant award Special Education Services

Federal Funds and MOE  LEA cannot consider Federal Funds when calculating MOE (34 CFR § (b)(3)) Special Education Services

Supplement vs. Supplant  Meeting MOE satisfies the supplement not supplant requirement  If an LEA dedicates the same or greater MOE for special education purposes, it will not violate the supplement/not supplant requirements of the IDEA. Special Education Services

Exceptions to MOE  Voluntary departure, by retirement or otherwise, or departure for just cause of special education or related services personnel 34 CFR §  Reduction of Force is NOT included in this exception  EXAMPLE: A special education teacher retires, and the salary and fringe of this long-term and experienced teacher is $90,000. The LEA can use this entire amount as an MOE exception if the teacher is not replaced; if replaced, and does not need to take the difference between the departing staff and the replacing staff. Special Education Services

Exceptions to MOE Special Education Services  Decrease in the enrollment of children with disabilities 34 CFR §  Must still meet the previous year’s per student level

Exceptions to MOE Special Education Services  Termination of costly expenditures for long-term purchases, such as the acquisition of equipment or the construction of school facilities 34 CFR §  At least $5000 per unit (Defined in EDGAR)  Useful life of at least one year  $5000 form must be on file  (Which basically means prior approval from SES)  Only for non-local fund expenditures  A note on construction:  IDEA funds cannot be used for construction 34 CFR §

Exceptions to MOE  Termination of an exceptionally costly obligation to a particular child with a disability because the child:  Has left the jurisdiction;  Has reached the age at which the obligation to provide a free appropriate public education (FAPE) to the child is terminated; or  No longer needs the program of special education 34 CFR § Special Education Services

Additional Guidance on MOE Exception Special Education Services  Contact SES staff for approval of all exceptions before including them in the application  All exceptions may be utilized  Not an “either/or” decision  Total amount of exceptions must equal the amount by which MOE was reduced  LEA responsible for supporting documentation  Unlike the stipulation in the 50% reduction, the resulting amount from the MOE exceptions are not viewed as moved or “freed-up” funds  Expenditures were higher the prior year because of this allowed exception – case closed

50% Reduction Option  LEA may reduce their MOE by 50% of the increase in Part B allocations  Referred to as “Freed-up”  This amount goes to activities that could be supported with ESEA funds (34 CFR § (b)  It is just that – an option  Affects, as in “Frees-up,” Local or State and Local Funds  Stays in effect until LEA increases its local effort Special Education Services

50% Reduction requirements Special Education Services  Increase in federal part B 611 allocations from one fiscal year to the next  Includes ARRA 611 funds  619 funds are not included  “Meets requirements” under the sec. 616 determinations  Has not had action taken against it by the SEA under IDEA section 616  Has not had responsibility for providing FAPE taken from it by the SEA  Has not been found by the SEA to have significant disproportionality under 34 CFR §

50% Reduction Example Special Education Services In 2008, the LEA received a sec. 611 allocation of 800,000 In 2009, the LEA received a sec. 611 allocation of 900,000 AND an ARRA allocation for sec. 611 of 750, , ,000 = 1,650,000 – 800,000 = 850,000 * 50% = $425,000

50% Reduction affects MOE Special Education Services  Remember: MOE is also a Target  Not reducing Federal Expenditures  Back to the example:  The LEA may reduce its expenditure of local, or State and local, funds for FY 2009 by $425,000  The $425,000 must be expended for activities/programs allowable under the Elementary and Secondary Education Act (ESEA)

50% Reduction is Moved or “Freed-up” Funds Special Education Services  Reduction is not a “savings” for the LEA  Funds STILL have to be spent  “Frees-up” funds by reducing the amount of local, or State and local, funds it spends on the education of children with disabilities  Spent on activities or programs allowable under the Elementary and Secondary Education Act, or ESEA.  Enhance or expand programs or activities for which the LEA is already expending funds or to start up new activities or create new programs  Any expenditures for which the LEA uses its Impact Aid funds  LEA must expend “freed-up” funds the same year reduction is taken  **LEAs are accountable for being able to demonstrate HOW and WHEN these funds are expended, such as during an audit.

CEIS – Coordinated Early Intervening Services Special Education Services CEIS are services for students in kindergarten through grade 12, with a particular emphasis on students in kindergarten through grade 3, who are not currently identified as needing special education and related services, but who need additional academic and behavioral support to succeed in a general education environment 34 CFR § (a)

Calculation of CEIS Special Education Services  An LEA may use up to 15% of the amount it receives under Part B, both sections 611 and 619, for CEIS, less any amount reduced by the LEA pursuant to 34 CFR § (34 CFR § (a))  Take 15% of the aggregated amounts of sections 611 and 619, including the 611 and 619 ARRA to determine CEIS

CEIS and 50% Reduction Special Education Services  From the CEIS total, subtract any amount the LEA wants to reduce its MOE under section  If an LEA is REQUIRED to use the entire 15% available for CEIS because it has been identified with significant disproportionality under 34 CFR § , then the LEA cannot reduce its MOE

CEIS Requirements with 50% Reduction Special Education Services  The amount of funds expended by an LEA for CEIS must count toward the maximum amount of expenditures that the LEA may reduce under 34 CFR § (a)  This means that, no matter how much is available for CEIS (up to 15%) or for MOE reduction under § (a), the total amount expended on CEIS and MOE reduction together cannot exceed the lesser of the total amount available for MOE reduction under § (a) or the amount available for CEIS  See 34 CFR §§ (d) and (a)

Effects of 50% Reduction Special Education Services  Remember: when an LEA reduces its MOE pursuant to 34 CFR §§ or , the adjusted amount is the LEA’s new MOE level until the LEA, on its own, increases the level of special education expenditures, using local, or State and local, funds

Effects of 50% Reduction Special Education Services  FY 2008 Effort 1,000,000  FY % reduction 425,000  (1,000,000 – 425,000 = 575,000)  Effort for FY ,000  Effort required for FY ,000  If the LEA expends $575,000 in FY 2010, Effort required for FY 2011 = 575,000  An MOE reduction under either of these provisions does not constitute a failure to maintain MOE

Thoughts on the 50% Reduction  Pros:  “Free-up” local funds for other ESEA activities  Assist budget planning in meeting future MOE  New MOE level continues until LEA increases expenditures  Cons (Considerations Really):  Additional reporting  Must report how the “Freed-up” funds from the 50% reduction was spent on other ESEA activities  Only required for the year in which the reduction was taken  Reducing MOE obligations must not result in a reduction of special education services. Special Education Services

Consequence of Not Meeting MOE Special Education Services  LEA must pay difference back to US Dept. of Education with local funds  Payment will be facilitated by KSDE  One time penalty

Justifications for MOE Exception Special Education Services  Upon submission of Part II LEA app, a justification text box will appear if MOE is not met  Enter justification in below format:  Application Line you are using for the MOE test  MOE Exception taken and amount  MOE 50% reduction and amount  List the supporting documentation  New LEA application will require the uploading of supporting documentation – PDF