1. Maintenance of Effort, Comparability, and Supplement/Supplant
PAFPC May
Don McCrone Lynn Calvello

2. Guidance covers these areas
Title I Fiscal Guidance REQUIREMENTS UNDER THE ELEMENTARY AND SECONDARY EDUCATION ACT OF 1965 (ESEA), AS AMENDED BY THE EVERY STUDENT SUCCEEDS ACT (ESSA)
Maintenance of Effort (MOE)
Comparability
Supplement not Supplant
Carryover
Grantbacks
Guidance covers these areas

3. ESEA, as amended by the ESSA
Maintenance of Effort
An SEA must reduce an LEA’s allocation under a covered program if the LEA fails to maintain effort in a given fiscal year and also failed to maintain effort in one or more of the five immediately preceding fiscal years.
(ESEA section 8521(b)(1))
Legal Authority:
ESEA, as amended by the ESSA
New Flexibility regarding Reduction of an LEA’s Allocation for Failing to Maintain Effort
• An SEA must reduce an LEA’s allocation under a covered program if the LEA fails to maintain effort in a given fiscal year and also failed to maintain effort in one or more of the five immediately preceding fiscal years.
(ESEA section 8521(b)(1).

4. NEW Maintenance of Effort
Title I, Part A – improving basic programs operated by LEAs
Title I, Part D – prevention and intervention programs for children and youth who are neglected, delinquent, or at-risk
• Title II, Part A – supporting effective instruction
• Title III, Part A –English language acquisition, language enhancement, and academic achievement
• Title IV, Part B – 21st Century Community Learning Centers
• Title V, Part B, Subpart 2 − Rural and low-income school program
• Title VI, Part A, Subpart 1 − Indian education
(ESEA sections 8101(11), 6118(c), 8521(a).)
MOE Requirement
Updated Programs to which the Maintenance of Effort Requirement Applies
• Title I, Part A – improving basic programs operated by LEAs
• Title I, Part D – prevention and intervention programs for children and youth who are neglected, delinquent, or at-risk
• Title II, Part A – supporting effective instruction
• Title III, Part A –English language acquisition, language enhancement, and academic achievement
• Title IV, Part B – 21st Century Community Learning Centers
• Title V, Part B, Subpart 2 − Rural and low-income school program
• Title VI, Part A, Subpart 1 − Indian education
(ESEA sections 8101(11), 6118(c), 8521(a).)

5. MOE Preceding Fiscal Year
Maintenance of Effort
LEA may receive funds for any fiscal year (FY) only if SEA finds either:
The combined fiscal effort per student
Or the aggregate expenditures of the LEA from state and local funds for the preceding FY was not less than 90% of the combined fiscal effort per student or aggregate expenditures for the second year FY.
i.e. Compare last FY to the preceding FY
EX: To receive FY 2017 funds (available July 2017), compare FY 2016 ( ) to FY 2015 ( )
PDE Uses Annual Financial Report (AFR) data
MOE Preceding Fiscal Year
New Flexibility regarding Reduction of an LEA’s Allocation for Failing to Maintain Effort
• An SEA must reduce an LEA’s allocation under a covered program if the LEA fails to maintain effort in a given fiscal year and also failed to maintain effort in one or more of the five immediately preceding fiscal years.
(ESEA section 8521(b)(1).)

6. Expenditures Included
Maintenance of Effort
“Expenditures from state and local funds for free public education”
Expenditures Included
Included: Administration; instruction; attendance and health services; pupil transportation services; operation and maintenance of plant; fixed charges; and net expenditures to cover deficits for food services and student body activities

7. Expenditures Excluded
Maintenance of Effort
Funds from federal the government
Community services; capital outlay; debt service; or supplemental expenditures made as a result of a Presidentially declared disaster
Expenditures Excluded

8. MOE Failure Maintenance of Effort
ESEA: If LEA fails MOE, SEA must reduce amount of allocation in the exact proportion by which LEA fails to maintain effort below 90%.
LEA notified in writing of failure to maintain fiscal effort
MOE Failure
Allocation reduces for all federal programs, not just Title I
LEA is notified in writing of Failure to Maintain fiscal effort
May request USDE waiver
DFP will assist LEA with waiver process

9. MOE Notification Letter
Maintenance of Effort
Before actual steps are taken to reduce LEAs federal program(s) allocation:
LEA is given the opportunity to:
Review AFR information for accuracy
Submit revised AFR to the PDE at
Notify PDE if a revised AFR has been submitted
Submit a request for waiver from the USDE
MOE Notification Letter
SAMPLE LETTER: This letter is to inform you that the Division of Federal Programs has determined that LEA has failed to maintain fiscal effort when comparing the fiscal year ending June 30, 2014 to the fiscal year ending June 30, Maintenance of Effort (MOE) references a federal regulation requiring grant recipients to maintain a certain level of state/local fiscal effort in order to be eligible for full participation in federal grant funding. When an LEA fails to maintain fiscal effort (measured by aggregate expenditure or per pupil expenditure), the SEA is required to reduce its allocations to Title I, Part A, as well as other federal programs for the appropriate year.
According to your Annual Financial Report (AFR), aggregate or per pupil spending from state and local sources decreased by 19% during the most recent comparison year ( ). This amount is 9% greater than the allowable reduction of 10%, and therefore, this percentage must be deducted from the allocations for each of the federal programs administered by our office. The Division of Federal Programs will deduct these funds by way of a downward funding adjustment. The U.S Secretary of Education may waive the MOE requirement if it is determined that the decrease in fiscal effort was due to—
• Exceptional or uncontrollable circumstance such as a natural disaster; or
• A precipitous decline in the financial resources of the LEA. [Section 9521(c)]
Before actual steps are taken to reduce your federal programs allocations, we ask that you review your AFR information for accuracy and contact the School Finance section of the Labor, Education, and Community Services Comptroller’s office to discuss any errors and determine whether a revised AFR should be submitted. If a revised AFR has been submitted or you would like to request a waiver from the U.S. Department of Education, please notify us by December 2, A revised MOE report will be run in December and no further changes will be made to MOE at that time. If the revised report indicates MOE has been met, we will send you a notification confirming that point. If failure to maintain fiscal effort is still indicated, we will take action to reduce your federal programs allocations, and notify you of the revised amounts so that you may plan accordingly.

10. MOE Waiver Maintenance of Effort
Secretary of USDE may waive the MOE requirement if decrease in fiscal effort was due to:
Uncontrollable circumstances such as natural disaster
Precipitous decline in financial resources
NEW - Change in the organizational structure of the LEA (ESEA section 8521(c)(1)
MOE Waiver
Examples for what a change in the organizational structure of an LEA might mean.
• An LEA changes its configuration. For example:
- The LEA merges with another LEA.
- The LEA divides into two or more LEAs.
- The LEA eliminates grade levels (e.g., previously served grades K-12 and now serves grades K-8)
• An LEA changes its management or operations structure to create economies of scale to be more efficient. For example, each school in the LEA employs budget and fiscal management staff. The LEA makes the decision to consolidate budget and fiscal management staff into a single team located in the central office.
If an LEA wishes to request a waiver of maintenance of effort based on a change in its organizational structure, what evidence should an LEA provide to the Department to demonstrate that the change in organizational structure caused the LEA to fail to maintain effort?
In requesting a waiver based on a change in its organizational structure, an LEA would need to provide evidence of that change and the reasons why the change caused the LEA to fail to maintain effort. To explain the change in its organizational structure, the LEA might provide a narrative description of the change or a visual, organizational chart or map, if relevant. The LEA would also need to explain why the change caused the LEA to fail to maintain effort. In doing so, the LEA might show its expenditures related to its organizational structure before and after the change to demonstrate that the change resulted in lower expenditures.

11. Maintenance of Effort Aggregate Expenditures Amount per student SY 15
Aggregate Expenditures
Amount per student
SY 15
$ ,000,000.00
$ ,100.00
SY 16 - must spend 90%
$ ,000.00
$ ,591.00
16 - Actual amount
$ ,000.00
$ ,200.00
Shortfall
$ ,000.00 $
Percent shortfall
7.0%

12. Maintenance of Effort Years after failure
SEA uses 90% of the prior year amount rather than the actual expenditure amount

13. Comparability
REQUIREMENTS UNDER THE ELEMENTARY AND SECONDARY EDUCATION ACT OF 1965 (ESEA), AS AMENDED BY THE EVERY STUDENT SUCCEEDS ACT (ESSA) §1118(c)

14. Comparability
An LEA may receive Title I Part A funds only if it uses state and local funds to provide services in Title I schools that, taken as a whole, are at least comparable to the services provided in non-Title I schools.
If all are Title I schools, all must be “substantially comparable.”
New – demonstrated only by staff/pupil ratios. ESSA Effective

15. Comparability How to measure in a district with non Title buildings
Compare:
Average of all non-Title I schools, to
Each Title I school
Average of all non-title I schools = 10:1
Title I schools:
Lincoln: 10:1 Washington: 9:1 Madison: 11:1 Jefferson 12:1
In this example we see the LEA has averaged the student to teacher ratios in it’s non-Title I schools and it comes to 10:1. Its ratio in the higher poverty Title I schools shows comparable class sizes in Lincoln and Washington but not in Madison and Jefferson. Ultimately, this LEA would be required to shift non-federally paid staff from its non-Title I schools (or possibly it’s Title I schools, as long as they remain in compliance with the decreased staff in place) into Jefferson and/or Madison until comparable ratios are achieved.

16. Comparability How to measure in a district with all Title I buildings
Compare:
Average of one or more of the lowest poverty Title I schools to each higher poverty Title I school
Lincoln 30% poverty, Washington 50%, Madison 55%, Jefferson 60% Chose only Lincoln as the comparison school
Lincoln 30%, Washington 32%, Madison 55%, Jefferson 60%, chose both Lincoln and Washington as the comparison schools
In this example we have a district with all its buildings as Title I serviced, so no clear cutoff appears with respect to which schools to compare. In the previous example we simply compared the non-Title I buildings with the Title buildings to determine comparable class sizes. Here, however, we need to examine the poverty levels of each of the buildings to establish which schools are comparison schools. Remember, the intent of Comparability is to examine equitable student to teacher ratios in the high poverty schools compared to an LEAs low poverty schools. In the second bullet there is a considerable 20% variance in poverty from Lincoln’s 30% to Washington’s 50%. Madison (at 55%) and Jefferson (at 60%) are much more similar to Washington, so we would use only Lincoln and compare it to each of the other three. However, in the third bullet the poverty levels of Lincoln and Washington would require us to use both as the low poverty schools, as there is a 23% poverty variance between each group of two.

17. Timing Issues Comparability Guidance: Must be annual determination
Review for current year and make adjustments for current year.
Use October staff and enrollment numbers
Timing Issues
Before examining Comparability in detail, there are some critical timing issues that need to be reviewed. First, like Maintenance of Effort, Comparability must be an annual determination, and must be done early enough in the school year to make adjustments, if necessary, for the current year. In other words, this requirement is a prerequisite to receiving federal funds. An LEA’s signed assurances must be received by November 15 of each year.

18. Comparability Reminder
Due Date November 15th
Late submission of the Comparability Report will result in risk assessment points
Worksheet / Assurances
pa.NCLBComparability.com
Reminder
Reminder:
Points add up! - Based on the total points assessed - each LEA/Charter School will receive a high, medium, or low risk category.
YOU must print a copy of your report for your files and have the assurance signed prior to uploading

19. Charter schools Comparability
Exempt but must still submit the Comparability Assurance Worksheet.
If exempt from demonstrating comparability
sign in pa.NCLBComparability.com
access the Assurances Worksheet
obtain required signatures
upload
Charter schools
Although monitors may be able to access the Comparability site - it is good practice to keep a signed copy of the assurance.

20. pa.nclbcomparability.com New to the site Forgot your password
CLICK HERE

22. Comparability Assurance Worksheet

23. Comparability Assurance
Superintendent
Business Manager
Title I Coordinator

24. Supplement/Supplant
“Supplement not Supplant” is the basis for the use of all federal funds administered via the Division of Federal Programs.
Federal funds must be used to supplement and in no case supplant state, and local resources

25. Supplement not Supplant
“What would have happened in the absence of the federal funds??”
Presumptions of Supplanting
Required to be made available under other federal, state, or local laws
Provided with non-federal funds in prior year
Provided services to Title I students and the same services were provided to non-Title I students using non-federal funds.
Prior SNS Rule

26. Supplement not Supplant
(NEW)To demonstrate compliance, the LEA shall demonstrate that the methodology used to allocate State and local funds to each school receiving assistance under this part ensures that the school receives all the State and local funds it would otherwise receive if it were not receiving Title I funds.
Similar to prior SW standard
TITLE I, A SNS (CONT.)
SEC. 1118(b)(2)

27. Supplement not Supplant
(NEW)No LEA shall be required to:
Identify individual costs or services as supplemental; or
Provide services through a particular instructional method or in a particular instructional setting to demonstrate compliance.
TITLE I, A SNS (CONT.)
SEC. 1118(b)(3)

28. Supplement not Supplant
(NEW)The Secretary may not prescribe the specific methodology a LEA uses to allocate State and local funds to each Title I school.
TITLE I, A SNS (CONT.)SEC. 1118(b)(4)

29. New - Supplement Not Supplant
USDE withdrew regulations in regards to the methodology (options) LEAs would use to be in compliance with the new Supplement not Supplant regulations.

30. Supplement not Supplant
Methodology Options
Weighted Per Pupil Formula
Based on characteristics of students (i.e. poverty, ELs, SWDs, and others with educational disadvantage)
Distribution Based on Personnel and Non-Personnel Resources
Average districtwide salary for each category of school personnel (principals, librarians, school counselors, etc.)
Multiply by number of school personal
The average districtwide per-pupil expenditures for non-personnel
Multiply by the number of students in the school.
WITHDRAWN SNS DRAFT REGULATIONS (B)(1)(II)

31. Supplement not Supplant
Methodology Options (con.t)
SEA-Established Compliance Test  
Test must be as rigorous as other approaches (and results in substantially similar amounts of funding)
Must be approved through Federal peer review process
SEA is not required to establish the test
LEA is not required to use the test if established
WITHDRAWN SNSDRAFT REGULATIONS (CONT.)
200.72(B)(1)(II)

32. Supplement not Supplant
Special Rule
An LEA may distribute State and local funds using any methodology that results in the LEA spending an amount of State and local funds per pupil in each title I school that is equal to or greater than the average amount of State and local funds spent per pupil in non-Title I schools.
WITHDRAWN SNSDRAFT REGULATIONS (CONT.)
200.72(B)(1)(III)

33. Supplement not Supplant
(NEW)Timeline
ESSA is not in effect until July 1, 2017 (per Omnibus)
Shall meet the compliance requirement no later than 2 years after enactment of ESSA; and
Enactment was December 10, 2015; so 2 years is December 10, 2017.
May demonstrate compliance before the end of the 2 year period using prior SNS test.
TITLE I, A SNS (CONT.)
SEC. 1118(b)(5)

34. Supplement not Supplant
ESSA makes No Change
An LEA may receive Title I Part A funds only if it uses state and local funds to provide services in Title I schools that, taken as a whole, are at least comparable to the services provided in non-Title I schools.
Student/ instructional staff ratios;
Student/ instructional staff salary ratios;
Expenditures per pupil; or
A resource allocation plan based on student characteristics such as poverty, LEP, disability, etc. (i.e., by formula)
If all are Title I schools, all must be “substantially comparable.”
COMPARABILITY
SEC. 1118(c)

35. Well Rounded Education
All costs charged to Title I in a schoolwide program must be:
Consistent with the school’s needs
Reasonably designed to improve student outcomes
Necessary and reasonable
Meets intent and purposes
Educationally related
Controls to ensure Title I funds are spent responsibly

36. Supplanting in School wide Buildings
Title I should be used to close achievement gaps, not budget gaps.
Total amount of federal funds are supplemental
Does the district have a federally neutral funding formula for school allocations?
Were building allocations reduced? If so, how and which ones.
If Comparability was required, how close did they make it by?
Do expenditures match SW plans and do they meet an educational need.
Finally, examine previous year actual per-pupil expenditures
Making the right decisions

37. Supplanting in School wide Buildings
Instruction - YES
Instructional support - probably YES
Administration - possibly YES
Operational - NO
Most often needs to be taken case by case basis
What is “educational need”?

38. What is different in School wide?
The Title I statute takes a different approach in school wides in an effort to drive comprehensive reforms and approaches in high-poverty schools
Instead of making sure Title I delivers “extra” programs and services…
We look at the amount of state and local money a school wide school receives to make sure it has all the money it would get if it did not also receive federal funds
The goal is to make sure Title I schools, in the aggregate, get extra money – they then have flexibility in how they spend their money
What is different in School wide?

39. School wide Taking a step back,
Depending on its needs, a schoolwide programs school could spend Title I to:
Implement a stronger curriculum
Implement an early warning system
Extend the school day or school year
Reorganize class schedules to increase teacher planning time
Revamp the school’s discipline process
Hire additional teachers
Reorganized classes to promote personalized learning
Implement career academies
Implement school safety programs
Attendance, school climate, and anti-bullying efforts.
What could school wide look like?

40. Why doesn’t school wide look that way now?
Title I funds are supposed to supplement state and local efforts
Three presumptions of supplanting:
Mandated by state/local law
Paid for with state/local funds in prior year
Same services paid for with the Title I for Title I students and state/local funds for non-Title I students
Historically, compliance has been reviewed programmatically, by defining the programs and services school districts will deliver with the state and local funds
Under the approach, Title I funds are typically limited to separate add-on services

41. Supplement not Supplant
Negotiated Rulemaking
Section 1118(b)(3) includes a special rule stating that “[n]o [district] shall be required to – (A) identify that an individual cost or service supported under this part is supplemental,” which effectively prohibits a key test previously used to ensure compliance in many Title I schools.

42. Supplement not Supplant
Also, the law replaces the two supplement-not-supplant tests (one for targeted assistance schools and one for schoolwide program schools) with a single compliance test that focuses on a district’s methodology for allocating State and local funds.

43. Supplement not Supplant
Proposal requires that a district “demonstrate that the methodology used to allocate State and local funds to each [Title I school] ensures that such school receives all of the State and local funds it would otherwise receive if it were not receiving assistance under [Title I].”
The methodology must result in each Title I school spending an amount of State and local funds that is equal to or greater (per pupil) than the average spent in non-Title I schools in the district.

44. Closing thoughts Closing thoughts The SWP is VERY important!
Targeted versus SWP which is better?
Closing thoughts
DON – This was from last year – let me know if you want to keep

45. Questions