The American Recovery and Reinvestment Act (ARRA) of 2009 Title I Part A and IDEA

1
The American Recovery and Reinvestment Act (ARRA)
of 2009 Title I Part A and IDEA
2
South Dakota Department of EducationGrants
Management
3
Guiding Principles
4
Balance Speed and Effectiveness

• Balance speed and stimulus with careful planning
  and effective reforms
• LEAs should use funds expeditiously but sensibly

5
Short-term Investments that Produce Lasting
Results

• Maximize short-term investments with lasting
  results.
• Minimize unsustainable ongoing commitments
• Avoid the funding Cliff

6
Accountability and Transparency

• All ARRA funds must be tracked separately
• Quarterly reports on both financial information
  and how funds are being used
• Beginning July 1, 2009
• Estimated number of jobs created or saved
• US ED will issue specific guidance for preparing
  and submitting this recordkeeping and reporting
  information governing ARRA funds

7
Reporting ARRA Fund Use

• The ARRA contains very stringent reporting
  requirements and requires that detailed
  information on the uses of funds by available
  publicly

8
Reporting ARRA Fund Use

• Separately from regular program
• New CFDA Numbers for each program
• Maintain accurate documentation of all ARRA
  expenditures and ensure
• Accurate
• Complete
• Reliable

9
Fund distribution

• Reimbursement basis as expenditures are reported
  to the State
• Plan to use eGrant reimbursement system for both
  Title I and IDEA ARRA funds

10
Potential Uses of ARRA Funds

• Will the proposed use of ARRA funds
• Drive results for students?
• Increase capacity?
• Accelerate reform?
• Avoid the cliff and improve productivity?
• Track results?

11
Availability of ARRA Funds

• Title I, Part A in absence of a waiver, 85
  until Sept 30, 2010 any remaining by Sept 30,
  2011
• IDEA, Part B by September 30, 2011

12
Funding Periods Dates

• ARRA Allocations are considered part of the SY
  2009-10 Allocation
• But, costs are allowable beginning February 17,
  2009
• Regular Grant Period July 1, 2009 to September
  30, 2010
• Carryover Period October 1, 2010 to September 30,
  2011

13
Title I Part A Amounts

• Regular Allocation 43,747,031
• ARRA Allocation 34,650,000
• Total SY 09-10 78,397,031

14
IDEA Part B 611

• Regular Allocation 32,664,950
• ARRA Allocation 31,630,863
• Total SY 09-10 64,295,813

15
IDEA Part B 619 Preschool

• Regular Allocation 1,442,067
• ARRA Allocation 1,520,277
• Total SY 09-10 2,962,344

16
Accepting Federal Grants Funds

• The LEA accepts the legal responsibility for
  fulfilling all the program requirements.
• The LEA is accountable for all federal program
  funds.

17
Program requirements of ARRA funds

• All provisions that currently apply to IDEA funds
  apply to the IDEA ARRA funds.
• All applicable requirements that currently apply
  to the use of Title I, Part A apply to the Title
  I ARRA funds

18
Fiscal Requirements

• Supplement, Not Supplant
• Title I
• Comparability
• Title I
• Maintenance of Effort Requirements Different
  Methods for Each Program
• Title I
• IDEA

19
Supplement Not Supplant Title I

• Cannot use federal funds to pay for services,
  staff, programs, or materials that would
  otherwise be paid with state or local funds
• Designed to ensure federal funds pay for
  something extra

20
Supplanting Presumptions

• Presume supplanting in 3 situations
• 1. Used federal funds to provide services the
  district is required to make available under
  other federal, state or local laws

21
Presumptions (cont.)

• 2. Used federal funds to provide services the
  district provided with state or local funds in
  the prior year

22
Presumptions (cont.)

• 3. Used Title I, Part A funds to provide the same
  services to Title I students that the LEA or SEA
  provides with state or local funds to
  nonparticipating students

23
Rebutting the Presumption

• Presumption may be rebutted
• If SEA or LEA demonstrates it would not have
  provided the services with state or local funds
  if the federal funds were not available

24
Rebutting the Presumption

• To rebut presumption show
• Fiscal and programmatic documentation to confirm
  that, in the absence of federal funds, would have
  eliminated staff/services in question
• School Board action
• Budget histories and information
• Planning documents

25
Title I Exception to Supplement not Supplant

• The LEA used State or Local funds to conduct
  supplemental Title I like activities.

26
Title I Exception to Supplement not Supplant

• The activity previously paid with State or Local
  funds was allowable under Title I, Part A
• Consistent with all Title I fiscal and
  programmatic requirements.
• Meets the academic needs of Title I students

27
Example

• LEAs allocation was less than Title I teachers
  salary benefits
• The LEA contributed the difference
• Teachers activities were all allowable under
  Title I Part A
• The LEA could use Title I ARRA funds to replace
  the State Local contribution to the teachers
  salary benefits.

28
Supplanting in Title I Schoolwide Programs

• Presumptions do not necessarily apply to
  schoolwide programs however,
• The LEA must provide the school with the same
  amount of state and local funds as it would have
  received had it not received Title I funds.
• Do not shift State Local funds away from Title
  I schoolwide program to another school

29
Comparability Title I

• Ensures that services provided with state and
  local funds in Title I schools are comparable to
  those provided in non-Title I Schools
• In LEAs with all Title I schools ensures that
  services are substantially comparable between all
  schools
• Annual Requirement for affected LEAs

30
Comparability Title I

• Compare schools with similar grade spans
• Required if more than one school per grade span
• Excludes schools with less than 100 students
  enrolled
• State supplies forms guidance to affected LEAs.

31
ARRA NEW REQUIREMENT

• Each LEA that receives Title I ARRA funds must
  file with the SEA a school by school listing of
  its per-pupil educational expenditures from State
  and Local sources during the 2008-09 school year
  no later than December 1, 2009.

32
School by School Expenditures

• Typical LEA has at least 3 schools
• Elementary school
• Middle school
• High school
• Waiting for more guidance from US ED

33
Maintenance of Effort - Title I

• Requires that an LEAs expenditures from state
  and local funding remain relatively constant from
  year to year. (at least 90).
• Either on an aggregate or per pupil basis
• State must reduce a districts allocations in
  proportion to the they failed to meet the MOE
  threshold.

34
Title I Set asides

• 1 for parental involvement if Title I
  allocation over 500,000
• An amount up to 20 of the Districts allocation
  if any of its schools are in improvement
• supplemental educational services
• public school choice.

35
Districts must sub-allocate Title I funds to
Title I schools

• Budget and Track Title I sub-allocations
  expenditures by participating school
• Must follow the allocation procedures set out in
  the Consolidated Application
• Ensure actual per low income student amounts are
  in compliance with rank order of schools.

36
Equitable Services for Private School Students
and Teachers

• Districts must offer equitable services to
  private school students and teachers from ARRA
  funding
• The District must control funds and show the
  equitable amounts or services were provided

37

• IDEA Maintenance of Effort (MOE) Requirement

38
IDEA Supplement not Supplant

• If the LEA meets its MOE requirements, it is
  considered to have met the supplement, not
  supplant requirement.
• Individual activities are not looked at.

39
LEA MOE requirement

• With certain exceptions, Part B funds must not be
  used by an LEA 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 year

40
LEA MOE (cont)

• LEA application standard
• With certain exceptions, an LEA budgets for
  the education of children with disabilities, at
  least the same total or per capita amount of
  either
• local funds only or
• State and local funds
• as it spent from those same sources in the
  most recent prior year for which the information
  is available

41
LEA MOE (cont)

• Audit standard
• Compliance with the MOE requirement, after a
  fiscal year has ended, is based on the actual
  local or state and local expenditures for special
  education and related services in the audited
  year and the prior year

42
LEA MOE (cont)

• Dont include as state or local funds any federal
  funds for which the SEA or an LEA is required to
  account to the federal government

43
LEA MOE Example 1

• In fiscal year (FY) 2009, the LEA spent a total
  of 100,000 local funds and 900,000 state and
  local funds on the education of children with
  disabilities
• For FY 2010, the LEA must spend at least 100,000
  of local funds OR 900,000 of combined state and
  local funds for the education of children with
  disabilities

44
LEA MOE Example 1(cont)

• If the LEA spent 97,000 of local funds and
  905,000 of state and local funds on the
  education of children with disabilities, it would
  meet its MOE level
• If the LEAs calculation of 905,000 of state and
  local funds, included 64,000 of ESEA Title 1
  funds that it used for services to children with
  disabilities, it would not have met its MOE level

45
LEA MOE Example 2

• In FY 2009, Harrison LEA spent a total of
  100,000 local funds and 900,000 state and local
  funds on the education of children with
  disabilities
• In FY 2009, Harrison LEA had 150 children with
  disabilities
• 100,000/150 667
• 900,000/150 6,000

46
LEA MOE Example 2 (cont)

• FY 2010 the number of children with disabilities
  drops to 130
• For FY 2010, Harrison LEA must spend at least the
  following amounts on the education of children
  with disabilities
• 667 per child local funds (86,710) OR
• 6000 per child state and local funds (780,000)

47
LEA MOEExample 2 (cont)

• If in FY 2010 Harrison LEA spent 80,000 in local
  funds and 800,000 in state and local funds on
  the education of children with disabilities, it
  would meet it MOE level based on a per capita
  amount

48
LEA MOE Exceptions

• An LEA may reduce the level of its expenditures
  below the comparison year if the reduction is the
  result of
• Voluntary departure, or departure for just
  cause, of special education or related
  services personnel
• Decrease in enrollment of children with
  disabilities

49
LEA MOE Exceptions (cont)

• Termination of an exceptionally costly obligation
  of the agency to a particular child with a
  disability because the child
• Has left the jurisdiction of the LEA
• 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 special education

50
LEA MOE Exceptions (cont)

• Termination of costly expenditures for long-term
  purchases, such as acquisition of equipment or
  construction of school facilities

51
LEA MOE Common Problem

• The LEA does not fully spend the amount of local,
  or state and local, funds it was required to
  budget in its application at the beginning of the
  year to demonstrate to the State that the LEA
  would meet the MOE requirements.

52
Possible Optional MOE Flexibility 50 rule

• Available under the IDEA, but,
• Currently not allowed by State law.
• State plans to a introduce bill in the
  legislature in January 2010 to revise State law.
• Emergency provision to implement upon the
  governors signature.

53
LEA MOE Optional Adjustment 50 Rule

• For any fiscal year that an LEAs allocation
  exceeds the amount of its prior years
  allocation, the LEA may reduce its expenditure of
  local, or state and local funds by not more than
  50 of the increase in federal funds
• The LEA must use an amount of local funds equal
  to the reduction for activities that could be
  supported with funds under the ESEA

54
Optional MOE 50 Rule Continued

• The LEA must use the freed up local or State
  funds to carry out activities that could be
  supported with ESEA funds.
• The LEA must track and report to the SEA on the
  use of the freed up funds.
• Must use during current fiscal year
• Does not carryover into next fiscal year.
• This will reduce the MOE for next year.

55
Optional MOE 50 Rule Continued

• The LEA must spend the freed up local funding by
  June 30, 2010 or it will not make MOE in SY
  2009-10
• This flexibility must be taken in the fiscal year
  the excess IDEA allocation became available.

56
LEA MOE 50 Rule Exceptions

• The LEA is prohibited from reducing the level of
  expenditures for that fiscal year if an SEA
  determines that
• an LEA is unable to establish and maintain FAPE
• the SEA has identified the LEA for state
  enforcement through local determinations.

57
LEA MOE Adjustment Example

• In year 1, Taft LEAs allocation is 900,000.
• For year 2, Tafts allocation is 1,100,000
• Increase 200,000
• Maximum Amount of MOE reduction 100,000 for
  use in ESEA activities

58
Early Intervening Services (EIS)

• An LEA may use up to 15 of its annual
  allocation, less any amount by which it has
  reduced its MOE level, to develop and implement
  coordinated, EIS for children in K -12 who are
  not currently identified as needing special
  education but who need additional academic and
  behavioral support to succeed in a general
  education environment

59
EIS the 50 Rule on MOE Adjustments

• The amount of funds expended by an LEA for early
  intervening services counts toward the maximum
  amount of expenditures by which the LEA may
  reduce local effort

60
EIS the 50 Rule on MOE Adjustments - Continued

• LEAs use of Part B funds for early intervening
  services zeros out the ability for the LEA to
  take an MOE reduction.
• Basically the LEAs early intervening service
  amount equals or exceeds the amount of the 50
  MOE reduction

61
EIS/MOE Example 1

• Prior Years Allocation -- 900,000
• Current Years
• Allocation -- 1,000,000
• Increase 100,000
• Maximum MOE
• Reduction -- 50,000
• Maximum for EIS -- 150,000

62
EIS/MOE Example 2

• Prior Years Allocation 1,000,000
• Current Years
• Allocation 2,000,000
• Increase 1,000,000
• Maximum MOE Reduction 500,000
• Maximum for EIS 300,000

63
EIS/MOE Example 2 Continued

• If MOE Reduction is 500,000
• Then max EIS is 0
• If the EIS is 300,000
• Then MOE reduction max is 200,000

64
EIS/MOE Example 3

• Prior Years Allocation 1,000,000
• Current Years
• Allocation 1,000,000
• Increase 0
• Maximum MOE Reduction 0
• Maximum for EIS 150,000

65
Planning Budgeting

• Fiscal staff need to work with program
  coordinators in preparing budgets.
• Ensure Fiscal Requirements are met
• Ensure required program set asides are included
  in budgets.
• Ensure equitable share budgeted for private
  schools

66
Planning Budgeting (continued)

• Ensure costs are appropriately categorized
• Guard against exceeding amount available or under
  utilizing the full amount
• Ensure costs are allowable

67
Follow Approved Budgets

• Districts expenditure should follow the approved
  budgets.
• Just budgeting required set asides doesnt
  fulfill responsibility
• Actual expenditures will be looked at to ensure
  compliance.

68
Determining Allowable Costs for Federal Programs

• Analyze costs to determine if they are allowable
• Develop a formal process to ensure costs are
  allowable

69
Allowable Costs Questions

• Consistent with federal cost principles?
• Allowable under the grant program?
• Consistent with the approved application?
• Consistent with program specific fiscal rules?
• Consistent with the needs of the program

70
Basic A-87 Guidelines

• All Costs Must Be
• Necessary
• Reasonable
• Allocable
• Authorized or not prohibited under state and
  local law

71
Reasonable Costs

• A-87 Definition - A cost is reasonable if it does
  not exceed that which would be incurred by a
  prudent person under the circumstances prevailing
  at the time the decision is made to incur the
  cost.

72
Questions - Reasonable

• Is the expense targeted to a legitimate program
  activity?
• Do we have the capacity to use what we are
  purchasing?
• Can we prove that we paid a fair rate?
• Would I be comfortable defending this purchase?

73
Necessary

• Must be necessary for the performance or
  administration of the grant
• Questioning necessary
• Do we really need this?
• Do we already have existing resources sufficient
  for this purpose?

74
Allocable

• Can only charge in proportion to the value
  received by the program
• Example The district purchases a computer to
  use 50 in the Title I program and 50 in a state
  program can only charge half the cost to Title
  I

75
Questions - Allocable

• Can I prove the program benefited?
• Can I prove other programs are not the primarily
  beneficiary?
• Ensure only authorized use
• Incidental benefit is okay

76
Other Basic Guidelines

• Legal under state and local law
• If not legal under state law, cannot pay with
  federal funds
• Conform with federal law grant terms

77
Adequate Documentation

• Lack of Documentation is 1 Audit Finding
• Document the following
• Amount of funds under grant
• How the funds are used
• Total cost of the project
• Share of costs provided by other sources

78
Adequate Documentation

• Records that show compliance
• Records that show performance
• Other records to facilitate an effective audit
• Keep at least 3 years after the final project
  completion report is submitted
• Longer if unresolved audit issues

79
Program Implementation

• Monitor Expenditures to Budget
• Ensure Set-aside activities are completed
• Submit Timely reimbursement requests
• Submit Timely budget revisions or amendments

80
Completion

• Submit Project Completion Report
• Due within 90 days after grant period
• Ensure all required set asides were met.
• Maintain Program Records

81
Federal Cost Principles

• OMB Circular A-87 Cost Principles for State,
  Local Indian Tribal Governments
• Applies to School Districts
• Available at OMB website
• http//www.whitehouse.gov/OMB/circulars/index.html