introduction to title i, part a fiscal requirements

Introduction to Title I, Part A

Fiscal Requirements

Presented by Tiffany R. Winters, Esq.twinters@bruman.com

Brustein & Manasevit, PLLCSpring 2012 Forum

Overview

1) LEA-to-School allocations2) Set asides 3) Equitable Services allocation 4) Carryover 5) MOE6) Comparability7) Supplement not Supplant

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Valuable Legal Resource

“Title I Fiscal Issues” Feb. 2008www.ed.gov/programs/titleiparta/ fiscalguid.doc

Consolidating funds in schoolwide

programs, MOE, SNS, Comparability, Grantbacks, Carryover

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LEA-to-School Allocations

“Ranking and Serving” Rules 1) Identify Eligible Schools 2) Rank Schools in Order of

Poverty 3) Serve Schools Strictly in

Accordance with Rank

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STEP 1: IDENTIFY ELIGIBLE SCHOOLS

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Eligible School Attendance Areas

Percentage of children from low-income families who reside in area . . .

AT LEAST AS HIGH AS . . .

Percentage of children from low-income families in LEA

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LEA Discretion: Eligibility

“35 Percent Rule” May designate as eligible Must still serve in order

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LEA Discretion: Eligibility

“Grandfathering” option If a school has lost eligibility (fallen

below the poverty threshold used by the LEA)

THEN

May continue to serve but only for one more year

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5 Poverty Measures:

1. Census data2. Free and reduced price lunch3. TANF4. Medicaid eligibility5. Composite of above

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STEP 2: RANK ELIGIBLE SCHOOLS IN ORDER OF POVERTY

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Ranking and Serving Exceeding 75% poverty

Strictly by poverty Without regard to gradespan

At or below 75% poverty May rank by gradespan

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Ranking with Grade Span Option

School Poverty Rate

Albermarle Elementary 92%

Lincoln Middle School 87%

Beaumont High School 83%

Roosevelt Elementary 79%

Scott Elementary 74%

Toshiba Elementary 59%

Brennan Elementary 49%

Key Middle School 58%

Washington High School 70%

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STEP 3: SERVE SCHOOLS STRICTLY IN ORDER OF RANK

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Allocation to Schools NOTE: first, reserve set-asides

Allocate to schools based on total # of students from low income families residing in area (including nonpublic)

Discretion on amount of PPA Higher PPAs must be in higher schools on

ranked list

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Allocations given without regard to schoolwide or

targeted assistance model

Title I funding . . . . . . To serve school based on

poverty. . . To serve student based on

academics

Ranking with Grade Span Option

School Poverty Rate

# Poverty Students

PPA Allocation

Albemarle Elementary 92% 82 $1,500 $123,000

Lincoln Middle School 87% 90 $1,250 $112,500

Beaumont High School 83% 76 $1,250 $95,000

Roosevelt Elementary 79% 40 $1,000 $40,000

Scott Elementary 74% 56 $1,000 $56,000

Toshiba Elementary 59% 119 $1,000 $119,000

Brennan Elementary 49% 92 $1,000 $92,000

Key Middle School 58% 47 $1,000 $47,000

Washington High School 70% 160 n/a

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Ranking with Skipping

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“Skip” school, ONLY if:1. Meet Comparability;2. Receiving supplemental State/local

funds used in Title I-like program; and3. Supplemental State/local funds meet

or exceed amount that would be received under Title I

Still count and serve nonpublic in area

Exception: Rank & Serve

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Title I Set-Asides

LEA MUST reserve specific percentage:

20% choice transportation and SES 1% parental involvement 5% for teacher and paraprofessional

qualifications 10% professional development (if LEA ID)

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LEA MUST reserve but not specific percentage: Administration (public and private) Homeless Neglected & Delinquent

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LEA MAY reserve:

Incentives to teachers in ID schools (<5%)

Professional development “other authorized activities”

Summer school Preschool Districtwide program

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CAUTION:

DON’T CIRCUMVENT “RANKING AND

SERVING” RULES!

Funds for Supplemental Education Services & Choice Transportation

Amount equal to 20% of LEA allocation

(unless lesser amount needed) To pay transportation for choice To satisfy all requests for SES

services Both

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Credit for “Parent Outreach” Allow limited amount of funds for

“parent outreach” to count toward 20% Capped at 0.2% of LEA Part A grant May spend more for outreach, but only

0.2% counts toward 20% EX. – $1 million LEA grant;

20% = $200,000 0.2% = $2,000 can count toward

$200,000

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What costs count as “parent outreach”?

Parent notices, communication through the media, internet, and community, displaying information on LEA’s website, and parent fairs

Allowance, not a requirement

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Use 20% “unless a lesser amount is needed”

How do you know if less is needed?

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To spend less than 20%, LEA must: 200.48(d)(2)(i)

1. Partner, to the extent practicable, with outside groups (CBO, FBO, etc.)

2. Send timely, accurate notice to parents3. Ensure SES sign-up forms given directly

to all eligible students/parents4. Ensure SES sign-up forms made widely

available through broad dissemination (internet, other media, public agencies)

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5. Provide (at a minimum) two enrollment windows at separate points in school year of sufficient length

6. Ensure SES providers are given access to school facilities, using a fair, open and objective process, on same basis as others

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Does LEA need SEA’s permission before reallocating the 20%?

NO!

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LEA must document and notify SEA!

Before reallocating remainder of 20%, LEA must:

Maintain records demonstrating it has met criteria

Notify the SEA that it met criteria Notify SEA of amount of remainder

it intends to spend on other allowable activities

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Set Aside for Parent Involvement

For LEAs with Part A allocations >$500,000

1% minimum reserved Proportional amount to private

students 95% of remainder to schools 5% of remainder kept at LEA

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Equitable Services for Private School Students

Equitable Services:Deriving Allocation

General Formula: Based on number of:

1. Private school students 2. From low-income families3. Who reside in Title I-participating

public school attendance areas

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Calculate Allocation for Instruction:

1. Identify eligible school attendance areas2. Rank in order of poverty3. Strictly serve in rank order (i.e., ID who is

“Participating Public School”)4. Calculate PPA for each area5. Derive allocation amount for each area

Must include nonpublic low-income #

6. Reserve nonpublic amount PPA x # of nonpublic low-income students who

reside in participating public school area

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Equitable Services Set-Aside

School Poverty Rate

# Poverty Students

PPA Allocation

Albemarle Elementary 92% 82 $1,500 $123,000

Albemarle Elementary School Equitable Services Share

Children in Poverty in Albemarle Schools 82

Children in Poverty in Private Schools located in the attendance area

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PPA $1,500

Equitable Services Set-Aside $30,000

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Distributing the Funds

Two options:1) Pooling: pool the funds to use for students with greatest educational need anywhere in LEA; or

2) School-by-School: funds follow child to private school for educationally needy child in that school

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Reservation for districtwide instruction

If LEA reserves for “districtwide instructional programs for public elementary and secondary”

Then proportional amount goes to nonpublic

34 CFR sect 200.64(a)(2)(i)(A)

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Example

LEA reserves $500,000 for districtwide reading initiative

Of all low-income in LEA residing in participating attendance areas, 5% are private

5% of $500,000 to private allocation

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Applies to:

Summer school programs After school programs Reading coaches Parental involvement Professional development (optional set-

aside ONLY) Preschool Programs

(If Preschool is not included in the definition of an elementary school)

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Does Not Apply to:

SES/Choice (20%) Preschool

(If Preschool is not included in the definition of an elementary school)

Professional Development (10% for LEA Improvement)

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Carryover

Carryover

General Rule: May carryover up to 15% of Title I, Part A

Reallocated by state if exceeds

Waiver by SEA once every 3 years NOTE: FY 2009 flexibility

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Use of Carryover Funds

Flexible 3 Options:

1. Put back in LEA formula & redistribute2. Designate for particular LEA activities3. (Allow school to retain)

Cannot use in ineligible school

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3 Pillars of Fiscal Accountability

1. Maintenance of Effort2. Supplement not

Supplant3. Comparability

Maintenance of Effort

Most Directly Affected by Declining Budgets

The combined fiscal effort per student or the aggregate expenditures of the LEA

From state and local funds

From preceding year must not be less than 90% of the second preceding year

MOE: The NCLB Rule

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Need to compare final financial data Compare preceding FY to second

preceding FY

EX: To receive FY 2011 funds (available July 2011), compare preceding FY (2009-10) to second PFY (2008-09)

MOE: Preceding Fiscal Year (PFY)

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MOE: Failure under NCLB

SEA must reduce amount of allocation in the exact proportion by which LEA fails to maintain effort below 90%

Reduce all applicable NCLB programs, not just Title I

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Maintenance of Effort Example (SY 2011-2012)

Aggregate expenditures

Amount per student

SY 08-09 $1,000,000 $6,100

SY 09-10 must spend 90%

$900,000 $5,490

SY 09-10 Actual amount

$850,000 $5,200

Shortfall -$50,000 -$290

Percent shortfall** reduction in all ESEA programs

-5.6% -5.3%**

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USDE Secretary may waive for State Exceptional or uncontrollable

circumstances such as natural disaster

OR Precipitous decline in financial

resources of the LEA

MOE: Waiver

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July 2009 Draft Non-Regulatory Guidance SEA may apply for waiver on

behalf of LEAs http://www.ed.gov/policy/gen/leg/recovery/programs.html

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ComparabilityMay not be affected by declining

non-federal revenue, if treat all schools equally

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.”

General Rule – Section 1120A(c)

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Guidance: Must be annual determination

Review for current year and make adjustments for current year

Timing Issues

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LEA must file with SEA written assurances of policies for equivalence: LEA-wide salary schedule Teachers, administrators, and other

staff Curriculum materials and

instructional supplies Must keep records to document

implemented and “equivalence achieved”

Written Assurances

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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)

How to show equivalence achieved?

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Compare: Average of all non-Title I

schools to each Title I school

How to measure??

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Average of all non-Title I schools10:1

For example: Using student/ instructional staff ratios

Title I schools: Lincoln: 10:1 Washington: 9:1 Madison: 11:1 Jefferson: 12:1

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Basis for evaluation:

by similar grade-spans

or by similar size school

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Exclusions:

Federal Funds Private Funds Need not include unpredictable

changes in student enrollment or personnel assignments that occur after the start of a school year

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Staff salary differentials for years of employment

Exclusions: LEA may exclude state/local funds expended for:

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Consistent between Title I and non-Title I

Teachers (art, music, physical education), guidance counselors, speech therapists, librarians, social workers, psychologists

Paraprofessionals – up to SEA/LEA

Who is “instructional staff”?

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Supplement Not Supplant

Federal funds must be used to supplement and in no case supplant state and local resources

Supplement not Supplant

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Auditors’ Tests for Supplanting

“What would have happened in the

absence of these federal funds??”

OMB Circular A-133 Compliance Supplement

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Auditors presume supplanting occurs if federal funds were used to provide services . . .

Required to be made available under other federal, state, or local laws;

Provided with non-federal funds in prior year; or

Title I funds used to provide service to Title I students, and the same service is provided to non-Title I children using non-Title I funds.

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Presumption Rebutted! If SEA or LEA

demonstrates it would not have provided services if the federal funds were not available

NO non-federal resources available this year!

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What documentation needed?

Fiscal or programmatic documentation to confirm that, in the absence of federal funds, would have eliminated staff or other services in question

State or local legislative action

Budget histories and information 69

Must show:

Actual reduction in state or local funds

Decision to eliminate service/position was made without regard to availability of federal funds (including reason decision was made)

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USDE assumes state and local officials will work to find a way to comply with a state-mandated requirement

“While it is conceivable that an SEA or LEA could demonstrate that its loss of revenue is so great that it cannot meet a legal requirement, we believe that it typically would be extremely difficult to do so”

“The bar for rebutting this presumption is very high”

Letter from Asst. Secretary Melendez to Leigh Manasevit, January 2011

Can you rebut this presumption?

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Rebuttal Example

State supports a reading coach program 2010 -2011

State cuts the program from State budget 2011 -2012

LEA wants to support Title I reading coach program 2011 - 2012

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Rebuttal Example

LEA must documenta. State cut the programb. LEA does not have uncommitted

funds available in operating budget to pick up

c. LEA would cut the program unless federal funds picked it up

d. The expense is allowable under Title I

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Exclusion of Funds:

SEA or LEA may exclude supplemental state or local funds used for program that meets intents and purposes of Title I, Part A

EX: Exclude State Comp Ed funds

Exception: 1120A(d)

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Supplanting in a schoolwide program

Statute 1114(a)(2)(B): Title I must supplement the amount of funds that would, in the absence of Title I, be made available from non-federal sources. E-18 in schoolwide guidance

The actual service need not be supplemental.

Supplement not Supplant

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Questions??

This 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.

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