Special Education Funding 1 Compliance and Special Education Funding What’s MOE got to do with it?

Special Education Funding 1

Compliance and Special Education Funding

What’s MOE got to do with it?


Acronyms and Abbreviations• American Recovery and Reinvestment Act of 2009ARRA

• Coordinated Early Intervening ServicesCEIS• Financial Accountability System Resource Guide (FAR Guide)FASRG

• Individuals with Disabilities Education Improvement Act of 2004IDEA

• Individualized Education ProgramIEP

• Foundation School Program FSP

• Local Education Agency (District or Charter)LEA

• Notice of Grant AwardNOGA


Acronyms and Abbreviations

• Maintenance of EffortMOE• Public Education Information Management SystemPEIMS

• Student Attendance Accounting HandbookSAAH

• Summary of FinancesSOF

• Shared Services ArrangementSSA

• Texas Education AgencyTEA

• Texas Education Agency Secure EnvironmentTEASE

• United States Department of EducationUSDE


Key Terms• Maintenance of Effort ( MOE)

• Excess Costs

• Coordinated Early Intervening Services (CEIS)

• Desk Audit

• Supplement

• Supplant

• Voluntary Departure

• High Cost

• Termination of Obligation

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Objectives of this ModuleState Special Education Funding Compliance

52% Rule

Federal Special Education Funding

Compliance

Determination of Excess Cost to Establish

Need of Federal Funding

Maintenance of Effort (MOE)

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State Special Education Funding Compliance

At least 52% of state funds generated for

special education must be spent in support

of direct special education services.

(19 TAC §89.1121 (d) Distribution of State Funds and

19TAC §89.1125 Allowable Expenditures of State Special Education Funds


What Constitutes 52% of the State Special Education Basic Allotment?Specific Enhanced Program Intent Codes (PIC)


What About the 48%?No more than 48% of each school district's Foundation School Program (FSP) special allotments … may be expended for indirect costs related to the following programs: … special education... Administrative/indirect costs may be attributed to the following expenditure function codes34--Student Transportation

41--General Administration

81--Facilities Acquisition and Construction

Function 90 series of the general fund, as defined in the TEA publication, Financial Accountability System Resource Guide


What if we don’t spend it all?If state special education funds are

carried over from one year to the next,

entire amount must be budgeted and

expended on direct costs .

Administrative costs may not be taken

from carryover funds


Are we compliant? Maybe!State special education entitlement could go down one year(Example: poor attendance of students identified for special education services or significant changes to instructional arrangement FTEs)

Could satisfy the 52% requirement, but have a problem with maintaining effort for federal MOE purposes

Therefore, compliance with 52% Rule is not the same as compliance with federal MOEState special education dollars used to calculate the 52% requirement are part of the MOE formula, but only part


But our auditor says….

• Remember that this criteria of 52 % is the

current standard by which the auditor will

determine compliance for the state special

education allotment expenditures.

• Compliance with the 52% rule is not a

comparison of local/state support for the

program from one year to the next.


Federal Compliance


Eligibility to Apply for Federal FundsThe LEA is eligible to apply for a special education grant

if:• The LEA does not receive sufficient funds, including state and

federal funds, for the child with disabilities to pay for the special

education services provided to the child; or

• The LEA does not receive sufficient funds, including state funds

and federal funds, for all children with disabilities in the LEA to

pay for the special education services to the child…

TEC 29.018 (b-e)

The receipt of special education funds must be contingent upon the

operation of an approved comprehensive special education

program in accordance with state and federal laws and regulations.

TAC 89.1121(d)


Federal MOE and other IDEA-B Fiscal Compliance Requirements

MOE and

CEIS

Focuses on special education state and local expenditures in the current year as

compared to the previous year

Excess Costs

CEIS: an LEA may use up to 15% of the IDEA-B funds for any fiscal year

to develop and implement K-12

services for general education students who need additional

academic and/or behavioral support

Excess costs are those federal funds

necessary to provide the

program above and beyond those per-student state and

local funds expended the previous year


Part B Excess CostEducation Department Federal Administrative

Regulations(EDGAR) and IDEA

Subpart F: What are the administrative

responsibilities of the sub-grantee?

34 CFR 76.700 : Compliance with statutes

, regulations and applications

34 CFR 76.731: Records related to

compliance


How Do I Establish a Need for Federal Funds?

Excess Costs

The excess cost requirement mandates how much the LEA must

expend in state and local funds before it may begin expending

IDEA-B grant funds.

• Focuses on per-student spending in special education as compared

to per-student spending across all students.

• IDEA-B grant funds “must be used only to pay the excess costs of

providing special education and related services to students with

disabilities. ( 34 CFR 300.202(a)(2).

• An LEA must spend at least the average annual per-student

expenditure in an LEA during the preceding school year for an

elementary or secondary school student with a disability before

IDEA-B funds are used to pay the excess costs of providing special

education and related services. (34 CFR Appendix A to Part 300)

• http://tea.texas.gov/index2.aspx?id=2147499857

http://tea.texas.gov/index2.aspx?id=2147499857

http://tea.texas.gov/index2.aspx?id=2147499857


Worksheet for Excess CostsExcess Cost Worksheet - Elementary

Grades: (select)

Previous year's expenditures from all sources, for all elementary school students, minus capital outlay and debt service

State and local funds 0 Federal funds 0 Total 0 Capital outlay 0 Debt service 0 Total 0 Total adjusted previous year's expenditures 0

Previous year's elementary school expenditures from:

IDEA, Part B 0 ESEA, Title I, Part A 0 ESEA, Title III, Parts A and B 0 State and local special education funds 0 State and local funds for programs under ESEA Title I, Part A, and ESEA Title III, Parts A and B 0 Total 0

Previous elementary school enrollments:

Average number of elementary students enrolled, including students with disabilities 0 Average number of elementary students with disabilities 0 enrolled in the current year

Calculation results:

Average annual expenditure per elementary student 0

Minimum amount the LEA must spend for the education of elementary students with disabilities before using IDEA Part B funds 0

HELPHELPHELP

http://www.tea.state.tx.us/index2.aspx?id=2147499857


Excess Costs ActivityStep 1:

State and local tax funds $6,500,000

Federal funds $600,000

Total Expenditures $7,100,000

Less capital outlay and debt service relatingto the education of elementary school students

- 60,000

Total Adjusted Expenditures $7,040,000

Determine the total amount of expenditures for elementary school students from all sources – local, State and Federal (including IDEA-B) – in the preceding school year. Exclude capital outlay and debt services.


Step 2:Subtract from the Total Adjusted Expenditures amounts spent for:

(a) IDEA-B $200,000

(b) ESEA, Title I, Part A 250,000

(c) ESEA, Title III, Parts A & B 50,000

(d) State and local funds for children with disabilities

500,000

(e) State and local funds for programs under ESEA, Title I, Part A, and Title III, Parts A & B

150,000

Total Deductions $1,150,000

Total Adjusted Expenditures $7,040,000

Less Total Deductions -1,150,000

Total $5,890,000

From the amount determined in Step 1, subtract the previous year expenditures identified below (see Appendix 1 for a list of codes assigned to these expenditures). These are funds actually spent; not funds received and carried over to the current year. •(a) IDEA–B •(b) ESEA, Title I, Part A •(c) ESEA, Title III, Parts A and B State and local funds for children with disabilities, and •(d) State or local funds for programs under ESEA, Title I, Part A, and Title III, Parts A and B. These are funds that the LEA actually spent, not funds received last year but carried over for the current school year.


Step 3:

Total Amount from Step 2 $5,890,000

Average number of students enrolled in preceding year (October PEIMS snapshot)

÷800

Average annual per student expenditure

$7,362

Determine the average annual per student expenditure for elementary school students by dividing the average number of students enrolled in the elementary schools of the LEA during the preceding year (including children with disabilities) into the total amount computed in Step 2.The amount obtained through this computation is the minimum amount the LEA must spend (on the average) for the education of each of its elementary school children with disabilities with fund sources other than IDEA-B.


Step 4:

Number of students with disabilities in the LEA's elementary schoolsin the current year (October PEIMS snapshot)

100

Average annual per student expenditure (obtained from Step 3)

x $7,362

Total minimum amount of funds the LEA must spend for the educationof children with disabilities enrolled in the LEA's elementary schoolswith fund sources other than IDEA-B

$736,200

Determine the total minimum amount of funds the LEA must spend for e education of its elementary school children with disabilities in the LEA (not including capital outlay and debt service) with fund sources other than IDEA-B by multiplying the number of elementary school children with disabilities in the LEA times the average annual per student expenditure obtained in Step 3.Funds under IDEA-B can only be used for excess costs over and above this minimum.


But…The excess cost requirement does not

prevent an LEA from using IDEA-B funds to

pay for all of the costs directly attributable

to the education of a child with a disability

in any of the ages 3, 4, 5, 18, 19, 20, or 21, if

no local or State funds are available for

nondisabled children of these ages.

The LEA must comply with the non-

supplanting and other requirements of this

part in providing the education and services

for these children.


Supplement not SupplantFunds provided to the LEA under IDEA-B

must not be used 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.

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Requirements for Compliance: MOE

The LEA budgets for the education of children

with disabilities from local or combination of

local and state funds;

Spends funds for the same purpose as the most

recent prior year for which information is

available; and

Ensures that the amount of local funds budgeted

is at least the same, either in total or per capita,

as the amount the LEA spent for that purpose in

the most recent fiscal year for which information

is available.


MOE for Fiscal Year 2014 and Beyond

TEA has published IDEA-B LEA Maintenance of Effort

Guidance Handbook which provides a detailed

description of the steps that TEA will use to calculate an

LEA’s compliance with the MOE requirement.

Please note that beginning with fiscal year 2014, the

PIC 99 allocation is not used in the MOE calculation.

For MOE calculation for fiscal year 2013, allocated funds

will be used to determine MOE compliance with

previous year.

http://tea.texas.gov/Finance_and_Grants/Grants/Federal_Fiscal_Compliance_and_Reporting/IDEA_Fiscal_Compliance/IDEA-B_LEA_Maintenance_of_Effort

/

http://tea.texas.gov/Finance_and_Grants/Grants/Federal_Fiscal_Compliance_and_Reporting/IDEA_Fiscal_Compliance/IDEA-B_LEA_Maintenance_of_Effort/





34 CFR 300.203 provides the following four methods for

determining whether an LEA has met the IDEA-B MOE

requirement:

1. The total amount the LEA expended in state and local funds

must equal or exceed the amount it expended from those

sources for special education during the previous fiscal year.

2. The per-pupil amount the LEA expended in state and local

funds must equal or exceed the amount it expended per

capita from those sources for special education during the

previous fiscal year.

3. The total amount the LEA expended in local funds must equal

or exceed the amount it expended from that source for special

education during the previous fiscal year.

4. The per-pupil amount the LEA expended in local funds must

equal or exceed the amount it expended per capita from that

source for special education during the previous fiscal year.

An LEA only needs to pass one of the four tests to be compliant.


If the LEA was noncompliant in maintaining

effort in the preceding year, then the current

year must be compared to the second

preceding year rather than the preceding year

when the LEA was noncompliant.

For example, if the LEA was noncompliant in

the fiscal year 2013 final determination, then

the fiscal year 2014 determination must

compare fiscal year 2014 to fiscal year 2012.


Consequences for Noncompliance If an LEA fails all four tests, it will be notified of its preliminary

determination of noncompliance and given the opportunity to

respond by claiming allowable federal exceptions, voluntary MOE

reduction, and/or requesting state reconsiderations.

If an LEA does not have sufficient allowable federal exceptions, a

voluntary MOE reduction, and/or state reconsiderations to offset

the “decline in fiscal effort, the LEA must refund to TEA the

amount by which the LEA failed to maintain effort (i.e., the

difference between its prior and current year expenditures on

students with disabilities after all applicable federal exceptions,

voluntary MOE reduction, and state reconsiderations have been

applied).

If the refund amount exceeds the LEA's IDEA-B maximum

entitlement for the fiscal year under determination, the LEA will

only be required to refund the amount up to the LEA’s maximum

entitlement. The repayment must be made from nonfederal funds

or from funds for which accountability to the federal government

is not required, that is, from state and/or local funds.


Federal ExemptionsThe LEA may reduce the level of its state and/or local expenditures below the level

of those expenditures for the preceding fiscal year only if the reduction is

attributable to any of the following:

(a) The voluntary departure, by retirement or otherwise, or departure for just

cause, of special education or related services personnel.

(b) A decrease in the enrollment of children with disabilities.

(c) The termination of the obligation of the agency, consistent with this part, to

provide a program of special education to a particular child with a disability that is

an exceptionally costly program, as determined by the State Education Agency

(SEA), because the child—

(1) Has left the jurisdiction of the agency;

(2) Has reached the age at which the obligation of the agency to provide FAPE to

the child has terminated; or

(3) No longer needs the program of special education.

(d) The termination of costly expenditures for long-term purchases, such as the

acquisition of equipment or the construction of school facilities.

(e) The assumption of cost by the high cost fund operated by the SEA under34 CFR

300.704(c).

34 C

FR

300.2

04


Documentation for ExceptionsLEAs will complete TEA’s standardized assertion

forms to document any reductions attributable

to the allowable causes described above.

The assertion forms will be uploaded into the

Grants and Federal Fiscal Compliance (GFFC)

Reports and Data Collections application

available in TEASE/TEAL.


Departure of PersonnelIn order for the level of state and/or local

expenditures to be reduced on the basis of

departure of personnel, the LEA must provide the

following source documentation:

Source payroll record (e.g., personnel action

form, resignation letter signed and dated by the

employee) indicating the reasons why the

employee departed the LEA

Year-to-date payroll distribution journal

Employee’s State Board of Educator Certification

(SBEC) record (i.e., certification) Employee’s

signed and dated job description


Departure of PersonnelIn addition, the following conditions must be satisfied:

Departed personnel may no longer be employed by the LEA.

If a special education teacher has been reassigned to other

duties within the LEA, the reassignment does not qualify the

LEA to claim the “departure of personnel” exception.

The departure must be voluntary (that is, the employee

resigned or retired) or for just cause (the employee was

terminated as the result of misconduct or negligence). If the

LEA reduces the number of special education personnel as

the result of a reduction in force, the LEA may not claim the

“departure of personnel” exception.

The LEA may not claim the “departure of personnel”

exception when releasing or failing to renew the contract of

a probationary employee, as neither of those cases meets

the “just cause” requirement.


Decrease in Enrollment of Children with Disabilities TEA automatically accounts for a decrease in the enrollment of

children with disabilities when calculating the LEA’s IDEA-B MOE

in the following two ways:

1. If the number of students with disabilities decreases, and per-pupil

special education expenditures remain the same or increase, the LEA

will pass the second and fourth tests described in the Methods of

Determining Compliance section.

2. In addition, TEA implements allowable flexibility to reduce the

refund due by the percentage decrease in enrollment of children with

disabilities from the preceding comparison year to the most recent year.

For example, if the special education enrollment in the LEA decreased

by 5% and the LEA was determined to be noncompliant, then the refund

due would be decreased by 5%. This reduction is reflected on the LEA’s

MOE report.


Termination of Obligation In order for the level of state and/or local expenditures to be

reduced because the LEA no longer has an obligation to serve

a child with an exceptionally costly program, the LEA must

provide the following supporting documentation:

A schedule summarizing the total costs for each special

education student that participated in an exceptionally

costly program. The schedule must reconcile to the LEA’s

detailed general ledger and source records which must

include the fund/net asset code and object code for each

cost description.

A detailed general ledger and source records supporting

costs identified on the summary schedule provided.

TEA may also request a student’s individualized education

program (IEP). (If the IEP is requested, the LEA must provide it to TEA through a secure transmission

method (provided by TEA) within 24 hours of the request.)


Termination of Obligation An exceptionally costly program for serving a student with a

disability is defined as an amount greater than the average

per pupil expenditure (as defined in section 9101 of the

ESEA) in Texas. Examples of reductions in an exceptionally costly

program include, but are not limited to, the following:

A student in a residential placement graduates or moves out of the

LEA.

A residential facility closes.

A charter school or another school district begins providing educational

services for a student.

A student with a high number/level of personnel assigned to implement

the student’s individualized education program (IEP) leaves the LEA.

Such students would include but are not limited to students who are

identified as deaf, blind, deaf-blind, autistic, medically fragile,

emotionally disturbed, or having a severe disability across eligibility

categories.

A settlement agreement/corrective action ends.


Termination of Costly Expenditures

In order for the level of state and/or local expenditures

to be reduced because of a termination of costly

expenditures for long-term purchases, the LEA must

provide the following supporting documentation:

A schedule listing all of the items purchased,

description of the items purchased, and the general

ledger classification of the purchases, i.e., fund/net

asset code, function code and object code. The

schedule must agree to the LEA’s detailed general

ledger and source records, which must include the

fund/net asset code and object code.

A detailed general ledger and source records

supporting the costs identified on the summary

schedule provided.


Assumption of Cost by High Cost Fund

In order for the level of state and/or local expenditures to be

reduced because of assumption of cost by the high cost fund

operated by TEA, meaning the expenditure in the current year

was charged to the IDEA-B High Cost grant received from TEA,

the LEA must provide the following supporting documentation:

A detailed general ledger for the previous school year

indicating the cost was previously recorded under fund code

199 or 420.

A detailed general ledger for the current school year

indicating the cost was subsequently recorded under fund

code 226 (High Cost Grant).

The source records supporting costs identified on the

detailed general ledgers.


Voluntary Reduction of MOE

PL 108-446, Section 613(a)(2)(C)(i)for any

fiscal year for which the allocation received by

an LEA under section 611(f) exceeds the

amount received for the previous fiscal year,

the LEA may reduce the level of expenditures

otherwise required by subparagraph (A)(iii) by

not more than 50% of the amount of such

excess.

However…


Voluntary Reduction1. To be eligible :

The LEA must meet each of the state targets for the five

SPP compliance indicators (9, 10, 11, 12, and 13) and

Have a LEA Determination Level of “Meets Requirements” ,

and

Is not identified as having significant disproportionality.

2. The LEA will need to provide :

Form B: Assertion of Eligibility for Adjustment to Local Fiscal

Effort and supporting documentation (now in e-grant

application))

3. Will need to demonstrate and have evidence of eligibility:

Actual amount of adjustment

The amount of the adjustment expended on NCLB activities


PL 108-446, Section 613(a)(2)(C)(ii)

If an LEA exercises the authority

under clause (i), the LEA shall use an

amount of local funds equal to the

reduction in expenditures under

clause (i) to carry out activities

authorized under the Elementary

and Secondary Education Act.


Activities authorized under the Elementary and Secondary Education Act (ESEA)

Parental Involvement Activities

Drop out Prevention Programs for At-

Risk Children and Youth

Family Literacy Services

Activities to Promote Family Support

for Higher Education

Mentor Programs


ReportingThe reporting of any MOE Reduction on the

Special Education Consolidated Grant

application is only applicable to the Voluntary

MOE reduction for the grant application year.

Remember:

If the LEA failed to maintain effort (received a

letter of finding for MOE noncompliance), the

LEA must not report the noncompliance amount

on the Special Education Consolidated Grant

application.

MOE non-compliance is not Voluntary

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Relationship between Voluntary Reduction of MOE and CEIS There are two relationships between the

Voluntary Reduction option and CEIS:

1. Choosing to voluntarily reserve IDEA-B funds

for CEIS can limit the amount the LEA

voluntarily reduces MOE

2. Choosing to voluntarily reduce MOE can limit

the amount the LEA voluntarily reserves for

CEIS


CEIS

Remember:

If the LEA intends to use CEIS funds and is eligible

for voluntary reduction of MOE, both must be

planned for at the same time to ensure

compliance. If doing both the LEA must determine

which amount is the lesser; combined, the CEIS

set-aside amount and MOE reduction may not

exceed that lesser amount.

If the LEA is only doing one or the other, it is

unnecessary to consider the interconnection

between CEIS and MOE.


Federal Funds That May be Considered as State or Local Funds In years when the federal

government provides special

and/or additional federal funds

that TEA designates as state or

local funds (such as ARRA

SFSF, fund code 266), those

specific funds will be

automatically included in the

total aggregated expenditures

by function code for each

respective compliance year in

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Significant PEIMS Errors USDE approved TEA’s request to reconsider

significant PEIMS errors.Significant is defined as corrections that change the LEA’s

compliance status

To meet this definition the LEA must enter its self-reported

corrected data in to TEA’s IDEA-B LEA MOE calculation tool and

the results must reflect a change in the compliance status.

If a change results, TEA will recalculate a revised compliance

determination using the corrected data.

Any decision to use revised data will not change the

official PEIMS data. The official PEIMS data is final

and remain unchanged on all TEA products and

reports that rely on this information


Possible Consequences of a State Reconsideration Request Due to Significant PEIMS Errors TEA’s Federal Fiscal Compliance and Reporting (FFCR) division will

make the following notification of erroneous data submission:

Division of Financial Compliance– possible increased risk of audit,

investigation an/or review

Division of State Funding-possible effect on state funding

Division of Federal Fiscal Monitoring- possible identification as high-

risk resulting in a review of all reimbursements across grants

Office of Statewide Education Data Systems- possible identification

as high-risk

Department of Accreditation and School Improvement- risk for

investigation/review

Division of Enforcement Coordination and Governance-possible

recommendation for district-level interventions/sanctions based on

findings


Let’s Talk METHODOLOGY

The methodology for calculating IDEA-B MOE compliance is based on

both federal and state requirements. 34 CFR 300.203 provides the

following four methods for determining compliance:

The total amount the LEA expended in state and local funds must

equal or exceed the amount it expended from those sources for special


The per-pupil amount the LEA expended in state and local funds must

equal or exceed the amount it expended per capita from those sources

for special education during the previous fiscal year.

The total amount the LEA expended in local funds must equal or

exceed the amount it expended from that source for special education

during the previous fiscal year.

The per-pupil amount the LEA expended in local funds must equal or

exceed the amount it expended per capita from that source for special



Calculating State and Local FundsTo calculate the total amount expended in state and local funds,

TEA uses expenditures reported on PEIMS Record 032, Fund Code

199 for school districts, or 420 for charter schools, coded to

program intent code (PIC) 23 and PIC 33.

TEA also includes PEIMS Record 033, Fund Code 437 Shared

Services Arrangement – Special Education for Shared Service

Arrangements (Type 11) expenditures.

As described in the Federal Funds That May be Considered as

State or Local Funds section, in years when the federal

government provides special and/or additional federal funds that

TEA designates as state or local funds (such as ARRA SFSF, fund

code 266), those specific funds will be automatically included in

the total aggregated expenditures by function code for each

respective compliance year in the MOE calculation.


Function Codes Used in MOE Determination The function codes listed below meet the requirements of the

IDEA regulations and are used to aggregate state and/or local

expenditures within PIC 23 and PIC 33.

Function Code Description

11 Instruction

12 Instructional Resources and Media Services

13 Curriculum and Instructional Staff Development

21 Instructional Leadership

23 School Leadership

31 Guidance and Counseling Service

32 Social Work Services

33 Health Services

34 Student (Pupil) Transportation

36 Co-curricular/Extracurricular Activities

41 General Administration

51 Plant Maintenance and Operations

53 Data Processing Services


Function Codes Not Used in MOE Determination The function codes listed in the following table do not meet

the requirements of the IDEA regulations and are not used

to aggregate state and/or local expenditures within PIC 23

and PIC 33.

Function Code Description 35 Food Service

52 Security/Monitoring Service

61 Community Service

71 Debt Service

81 Facilities Acquisition and Construction

91 Contract Services

92 Cst/Sl WADA

93 PMT – SSA

95 PMT – JJAEP

97 PMT – TIF

99 Other Intragov Chgs


Special Education Student Count PEIMS Record 163 - Child-Count-

Funding-Type-Code 3 is used to identify

the Special Education Student

Population.

This special education student count is

also found on the line titled IDEA-B of the

PEIMS Edit+ report PRF5D010, Special

Education Child Counts by Funding Type.


Local Funds Imputing the total local portion of LEA

special education expenditures requires

the following:

The LEA’s total state and local special

education expenditures.

The LEA’s Tier 1 Special Education

Adjusted Allotment, total cost of Tier 1,

and local fund assignment from the

Legislative Planning Estimate (LPE)

column in the Summary of Finance (SOF)

dated September 10 or first date

thereafter in the year under

determination.


How do I do that? It is a 3 Step Process1. Determine the LEA’s local special education

expenditures that are in excess of its Tier I

Special Education Adjusted Allotment.

a. This determination is done by subtracting the Tier I

Special Education Adjusted Allotment from the LEA’s

total state and local special education expenditures.

b. If the LEA’s total state and local special education

expenditures is greater than the LEA’s Tier I Special

Education Adjusted Allotment, then the difference (the

expenditures made in excess of the Tier I Special

Education Adjusted Allotment) is considered to be

expended from local funds.


3 Step Process

2. Impute the LEA’s local special education expenditures

using the ratio of local funding within its total Tier I

Allotment.

a. First, determine the percentage of local funding within

the Tier I Allotment by dividing the LEA’s Local Fund

Assignment by the Total Tier I Allotment. If the Local Fund

Assignment is greater than

the Total Tier I Allotment, then the percentage of local

funding within Tier I is automatically adjusted to 100%.

b. Next, multiply that percentage by the total state and

local expenditures up to the Special Education Adjusted

Allotment. The result is the LEA’s imputed local special

education expenditures.


3 Step Process

3. Determine the LEA total local special

education expenditures for IDEA-B LEA MOE by

summing (a) the LEA’s local special education

expenditures that are in excess of its Special

Education Adjusted Allotment (determined in

Step 1 above); and (b) the LEA’s imputed local

special education expenditures (determined

in Step 2 above).

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IDEA-B MOE Calculation Tool To assist LEAs in complying with the MOE requirements for

FY2014 and beyond, TEA has developed a calculation tool

http://tea.texas.gov/Finance_and_Grants/Grants/Federal_Fiscal_Compliance_and_Reporting/IDEA_Fiscal_Compliance/IDEA-B_LEA_Maintenance_of_Effort

/

that LEAs may use to estimate their MOE compliance. To use the

tool, LEAs must be prepared to enter the following data:

Prior year and current year state and/or local expenditures in

relevant function codes as described in Appendix 3.

Special Education Student counts for the prior year and current

year (PEIMS Record 163, Child-Count-Funding-Type-Code=3).

Tier I Special Education Adjusted Allotment, Total Cost of Tier I,

and Local Fund Assignment data from the LPE Column of the

LEA’s Summary of Finance (SOF) dated September 10 or the first

date thereafter in the year under determination.






Things to think about: Reducing MOE Legally

1. Review current year expenditures before you “close

the ledgers” in light of the exceptions.

2. Using the information from previous year’s closed

budget and upcoming year’s program plan, are there

high dollar expenditures that may need to be

assigned to state and local special education funds in

your new budget?

3. Communicate with staff to determine future/

potential resignations and retirements

4. Anticipate capital outlay needs such as technology or

data management systems

5. Anticipate high cost student or program needs


Best Practices

• Calculate estimated MOE during budget development

process

• Track and document special education staff changes – HR

paper trail and PEIMS data accuracy

• Distribute and collect signed job descriptions for staff for

current position – keep current with changes in funding

and/or assignments (HR)

• Track and document expenditures related to exceptions –

use sub-object codes as appropriate

• Calculate actual MOE during the fiscal year

RemindersMaintenance of Effort – IDEA Part B


How do you maintain local effort when reducing

the LEA budget?

1. Calculate LEA’s MOE during the Budget

Process.

2. With Declining Financial Resources—Easier to

meet Per Pupil Expenditures rather than the

Aggregate Expenditures, but must monitor both.

3. With Declining Per Pupil Expenditures, must

monitor costs.

4. With Declining Per Pupil Enrollment, monitor

Per Pupil Expenditures in order to meet MOE.

What happens if we have overall budget reductions?


Federal Desk Audits/Review The objective of a review is to determine if

the sub-recipient complied with Title 34 CFR

80.20 and other applicable federal statues,

regulations and grant requirements.

Review focuses on fiscal practices developed

and implemented by the sub-recipient to

demonstrate compliance with the

requirements.

The review focuses on current grant and TEA

auditors will require LEA to submit prescribed

documentation.


Administrative Procedures Manual (APM)

The agency is expecting the LEA to have an approved APM in effect

and it must address the following fiscal and fiscal-related activities:Accounting for property and supplies purchased with federal funds

Budgeting and accounting for federal grants

Financial reporting and cash management for federal grants

Authorized uses for federal funds

Maintenance and retention of records pertaining to federal grants

Monitoring and reporting program performance for federal grants

Time and effort reporting requirements

Procurement of goods and services using federal grants

Program income generated from activities supported by federal grants

Support of salaries, wages, and related costs charged to federal grants

Travel reimbursement requirements applicable to federal grants

Use of credit and debit cards

Property management policy and property disposal policy

Administrative policies and procedures to help prevent and report fraud, waste,

and abuse of public funds.


Review

TEA will request the sub-recipient to submit the required documents

listed in the attachments to the letter no later than 10 business days

from the date of the letter.

All documents are to be submitted in electronic format, such as a CD

or flash drive.

Documents may include:

General ledger pages (specific)

Purchase orders ( specific)

Working papers for drawdown WebER request for specific dates

CEIS documentation

Comprehensive Needs Assessment and Program Plan

If requested documentation cannot be provided, a detailed

explanation is required.

Special Education Funding 1 Compliance and Special Education Funding What’s MOE got to do with it?

Documents

Transcript of Special Education Funding 1 Compliance and Special Education Funding What’s MOE got to do with it?