MASBO Summer Conference
June 17, 2015
Grouse Mountain Lodge
Verne Beffert, Director
Park County Coop
Disclaimer
The following information should be considered
my opinion, as a practical and at times a
philosophical approach to the operation of a
special education cooperative.
Verne
Free Appropriate Public Education
• Child Find activities (children ages 3-18) are
required to be conducted at no expense to
parents. This could include paying for a
medical diagnosis of ADHD.
• Special Education Children are to be provided
services at no cost to parents, which could
include nursing services, sign interpreters,
assistive technology, paraeducator support –
Free Appropriate Public Education (FAPE)
What is a Cooperative?
The basic reasons for creating a special education
cooperative is to:
• Access services which small districts may not be
able to provide on their own.
• Access administrative expertise specific to special
education.
• Provide a level of “insurance”. (risk pool, MOE)
• Be a good neighbor and support member districts
who need assistance at any given time.
Topics
Today we will review special education
financing with specific focus on Cooperatives.
This presentation is intended to provide a
broad overview, rather than specific coding
information.
Revenue
Expense Budgeting/Spending/MOE
Philosophy Based Decisions
Revenue
• IDEA Part B & Preschool
• State Special Education Cooperative Allowable
Cost Funding (Instructional Block Grant,
Related Services Block Grant, Travel
Entitlement, and Administrative/Operations
and Maintenance Entitlement)
• State Quality Educator Payment
• Reversion (of State Special Education
Allocation)
Revenue Continued
• Required Match (2 options for Coop members)
• Member District Proportionate Assessment
• Medicaid
IDEA Part B
• Generally the single greatest revenue source
• Annual allocation through OPI
• Coop receives the allocation of all member
districts
• Reimbursement basis, E-Grant process
• Direct Deposit – must be deposited in interest
bearing account
• “Carryover” – target of 25% to 50% of annual
allocation – range today is 0 to 100%.
IDEA Part B - Continued
• Allowable costs – salaries, benefits (must
follow salary coding), materials, supplies,
equipment, travel, professional development
(not an all inclusive list).
• Cannot be used for – retirement bonus,
unused sick leave or vacation, uses other than
special education
IDEA Preschool
• Annual allocation through OPI
• Coop receives allocation for all member
districts
• Reimbursement basis, E-Grant process
• Direct Deposit – must be in interest bearing
account
• How Coops manage this revenue varies
State Revenue
• Annual allocation through OPI – 10 payments
per year
• Instructional and Related Services Block
Grants, Admin and Travel Entitlements,
Quality Educator
• Direct deposit, must be deposited in noninterest bearing account
• Counts toward MOE (Maintenance of Effort)
Reversion
• Districts that do not spend their state
allocation on special education either send
the money back to the state, or to the Coop
(to avoid “reversion” to the state).
• Typically this happens only for small districts
who have no special education expenses.
Required Match
• Districts are required to “match” the funds paid
by the State to the Coop.
• Option 1 – Member districts transfer funds to the
Coop (counts toward Coop’s MOE)
• Option 2 – The Coop may elect to “waive”
collection of the required match. Member
districts provide the Coop a letter affirming the
district spent the required match on special
education. Counts toward district’s MOE.
Assessment
• Based on the Interlocal Agreement, the Coop may
“assess” member districts for additional revenue
(beyond the required match).
• Typically the assessment would be based on a
proportionate basis – either special education
enrollment or general education enrollment.
• Because the state did not provide an increase in
special education funding for the next two years,
coops may need to consider this option to cover
expenses.
Medicaid
• Direct Billing – OT, PT, SL, Psych,
Transportation, Activities of Daily Living
• Medicaid Administrative Claiming (MAC)
• CSCT (Mental Health Services)
• Coops either contract someone to bill on their
behalf or they do their own billing
• Medicaid expenditures do not count toward
MOE.
Tuition Fund
While a Coop does not have access to a
tuition fund, districts need to understand this
funding source which may indirectly effect
the Coop.
• Use of the Tuition Fund for high cost students
(Senate Bill 191, 2013 session)
• Use of the Tuition Fund for placement of
students in Residential or Day Treatment
facilities, both in-state and out-of-state
Tuition Fund - Continued
• Use of the tuition fund has political
implications.
• Does count towards MOE.
• May be subject to the legitimate reductions in
MOE (retirement of an employee, or loss of a
high cost student).
Expense Budgeting
• Fund 382 should be used almost exclusively
for salary expenses to maximize use of the
county retirement fund. Remember, benefit
costs follow salary expenses for coding
purposes.
• Split salary and benefit costs between funds
315 and 382 so that you can include more
people in your MAC reporting. (OT, SL, PT,
Admin, Nurse, Counselors, etc.)
Expense Budgeting - Continued
• Remember that all spending in program 280
counts toward MOE. (Transportation, Tuition,
General Fund, Retirement)
• Do not use Coop funds to pay for expenses
that can be paid from other district sources.
Examples would include transportation,
residential or day treatment placements, high
cost students, rather Districts should use their
own funds (general fund, Medicaid, or Tuition)
Expense Budgeting - Continued
• Coops do not have a compensated absence
fund – you need to carry enough reserves in
fund 382 to cover these expenses. (vacation,
sick leave, retirement bonus)
• Develop a plan to cover long term absences by
OT, PT, SL, and Psychs – you have to provide
FAPE even if an employee is on maternity
leave, sick leave, etc.
Expense Budgeting - Continued
• Cash flow – you need enough money in fund 382
to cover costs pending approval of your IDEA
grant application.
• Retain 1 year of Medicaid revenue in reserves in
case you are audited and have to repay some
Medicaid funds.
• Use Medicaid funds for those services that
generated the revenue (OT, PT, SL) for children
with Autism, Deafness, or who are Medically
fragile.
Expense Budgeting - Continued
• Medicaid may also be appropriately used for:
materials and equipment such as FM systems,
Braille materials, Sound field systems,
Assistive Technology, Communication devices,
Autism programs, resource room remodeling
• Ensure Medicaid funds are used for expenses
you would not be embarrassed to have
printed in the newspaper or Facebook.
Expense Budgeting - Continued
• Develop a budget for Coop Board approval,
remember retirement is the only “budgeted”
fund you have.
• Consider the concept of a “risk pool” that
gives member districts access to Coop funds
under certain conditions. Examples – transfer
students, unanticipated expenses that could
not be identified when building district
budgets in August.
Budgeting - Transfer of Funds
• The Coop retains responsibility to prove that
funds transferred from the Coop to the District
are used for the support of special education
services.
• The Coop and District clerks should agree on a
form for appropriate reporting to include
CFDA#, etc.
• See Park Coop example
Budgeting - MOE
Communicate with district clerks
1. Prior to August budget adoptions, discuss with
each district clerk their required level of MOE for
the new budget year.
2. Review MOE expectations with Coop board and
district clerks in the fall and early spring.
3. Check Trustees Financial Reports, for each
District, in September to ensure the Coop has
met MOE. This will give you time to adjust TFS
reports if necessary.
Budgeting - MOE
• Be prepared to help districts apply for a
reduction in MOE if they meet the criteria
1. Replacement of a high cost employee with a
lower cost employee (usually retirement)
2. High cost student leaves (transfers or graduates).
• OPI needs specific costs associated with each
request
High Risk Practices
• Risk 1 – open enrollment policies. If districts
accept out-of-district students, they will not
be able to refuse a high cost special education
student. The district may look to the Coop for
some of the necessary funding.
• Risk 2 – allowing students ages 19-21 to enroll
opens the door for special education children
to enroll and to be provided FAPE with the
attenuating costs of service, with NO ANB.
Philosophy Based Decisions
• District and Coop split costs for access to the
risk pool – holds the district responsible yet
provides some relief.
• If Coop funds are used to provide professional
development for district employees, consider
a split – Coop pays registration, District pays
transportation, meals, motel.
• Be sure Districts have some “skin in the
game”.
Philosophy Based Decisions
• Districts have access to the risk pool for
unanticipated expenses with the expectation
that the following year the district includes
the cost of the student in their budget.
• Base decisions on the amount of carryover
and reserves on solid rationale – cash flow,
risk pool, compensated absence liabilities,
student enrollment growth.
Philosophy Based Decisions
• Code special education expenses to special
education rather than playing games to keep
expenses as low as possible to meet the
minimum required (MOE).
• Correct coding to reflect actual special
education costs (personnel, transportation,
supplies, technology, tuition, Medicaid, etc.)
Closing Statement
The Cooperative Clerk has a unique
responsibility to develop a working
relationship with district clerks and to assist
district clerks to understand the unique
aspects of funding services for special
education children.
MOE
Transfer of Funds
Access to Risk Pool
General Discussion