Maintenance of Effort, Comparability,
and Supplement/Supplant
PAFPC March 2013
USDE Title I Fiscal Guidance
(May 06)
• www.ed.gov/programs/titleiparta/ fiscalguid.doc
This guidance covers these areas:
• Maintenance of Effort (MOE)
• Comparability
• Supplement not Supplant
• Carryover
• Grantbacks
Maintenance of Effort
Legal Authority:
NCLB: Section 9521
MOE: The NCLB Rule
• LEA may receive funds only if SEA finds
the combined fiscal effort per student or
the aggregate expenditures of the LEA
from state and local funds from preceding
year is not less than 90% for second
preceding year.
MOE: Preceding Fiscal Year
• Need to compare final financial data
– PDE Uses Annual Financial Report (AFR)
• Compare “immediately” PFY to “second”
PFY
• EX: To receive FY2005 funds (available
July 2005), compare FY2004 (2004-05) to
FY2003 (2003-04)
Expenditures Included
• “Expenditures from state and local funds
for free public education”
• 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
Expenditures Excluded
• Funds from federal government
• Community services; capital outlay; debt
service; or supplemental expenditures
made as a result of a Presidentially
declared disaster
MOE: Failure
• ESEA: If LEA fails MOE, 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
Aggregate
expenditures
Amount per student
SY 04
1,000,000
6,100
SY05 –
must spend 90%
900,000
5,490
05 –
Actual amount
850,000
5,200
Shortfall
-50,000
-290
Percent shortfall/ reduction
-5.6%
-5.3%**
Years after Failure
• SEA uses 90% of the prior year amount
rather than the actual expenditure amount
MOE: Waiver
• USDE Secretary may waive if:
– Exceptional or uncontrollable circumstances
such as natural disaster
OR
– Precipitous decline in financial resources of
the LEA
Comparability
Legal Authority:
Title I Statute: §1120A(c)
General Rule- §1120A(c)
• 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.”
• Currently demonstrated by staff/pupil
ratios.
How to measure in a district with
non-Title I 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
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
Basis for Evaluation
• grade-span by grade-span
or
• school by school (district-wide
basis)
Updates
• USDE School Level Expenditure report –
44 percent of Title I schools spend fewer
state/local dollars on teachers and other
personnel compared with non-Title I
schools.
• Poor kids are getting fewer education
dollars than their wealthier peers.
• Over 4,000 districts examined as a result
of ARRA
Updates
• USDE. Results indicate Comparability is
“broken.”
• Complete report found at
http://www2.ed.gov/rschstat/eval/titlei/school-level-expenditures/school-levelexpenditures.pdf
• The biggest (but not only) culprit: teacher
salary differentials
Updates
• Currently, PA examines comparability only
using staff to student ratios, regardless of
salary costs.
• Duncan “in far too many places, Title I is
filling budget gaps rather than being used
to close achievement gaps.”
Unions are Split
• NEA favors closing the “loophole” while
AFT opposes.
• Is having the same number of staff in Title
versus non-Title inequitable?
• Will this mean forced transfers to meet
new requirements?
• Not if we get a head start.
Timing Issues
• Guidance: Must be annual determination
• (old) Review for current year and make
adjustments for current year.
• (new) Budget for upcoming year and make
adjustments in current year, if needed.
• Assurances are due November 15.
• eGrants changes were made in 12/13.
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
Who is “instructional staff”
•
•
•
•
•
•
•
•
•
•
•
Administrators (principals and assistant principals)
Art Teachers
Classroom Teachers
Guidance Counselors
Librarians
Music Teachers
Physical Education Teachers
Project Directors (Non-federally funded)
Psychologists
Social Workers
Speech Therapists
Not included…
•
•
•
•
•
•
Bus Monitors
Consultants
Crossing Guards
Maintenance Staff
Security Staff
Federally paid Staff
Optional staff…
•
•
•
•
Bilingual Teachers
Special Education
Title I “Like” Staff
Teachers Aides (instructional)
• Although the LEA has the discretion to count or
not count these types of staff, it must be done
consistently across the grade spans being
compared.
New calculation 2012-2013
• An LEA must first attempt to demonstrate
comparability by showing that its combined state
and local per-pupil expenditures (including
actual personnel and actual non-personnel
expenditures) in each Title I school, using prior
year financial data, are at least 90% of the
average combined state and local per-pupil
expenditures for its non-Title I schools.
Exclusions
•
•
•
•
Pre-K expenditures.
Central office costs (including cost center 2818).
Charter School Tuition.
Alternative Education Programs (if enrollment is
District Wide only).
• Summer School expenditures (if enrollment is
District Wide only).
• Federal expenditures.
Exclusions, cont.
•
•
•
•
•
English language instructional costs.
Special education (including gifted and OT/PT).
Transportation.
Food Services.
Capital expenditures (LEA capitalization
threshold).
Be prepared to justify any other exclusion and
keep all documentation on file.
Personnel costs defined as objects 100 and 200.
How to access the Data Sheet
and Assurance page
• www.education.state.pa.us and click on the
eGrants link at the left of the page.
• Then click on the Division of Federal Programs
link at the left of the screen.
• Enter your Login ID and password, then click on
the “Consolidated Application” link.
• At the main Consolidated Application page you’ll
see the link for Comparability towards the
bottom of the screen.
Why this guidance?
• The schoolwide program model is a powerful
school improvement tool, but is rarely
implemented to its full potential because of
confusion over “supplement not supplant”
• Federal law sets a different test for schoolwide
program schools, but it is rarely applied
• Implementing this different test could radically
change how schools and districts spend Title I
finds, and how states oversee spending, so state,
district and school staff will need guidance and
support
Taking a step back, what could
schoolwide look like?
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
• And so much more . . . . . .
Why doesn’t schoolwide 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
What is different in schoolwide?
• The Title I statue takes a different approach in
schoolwides 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 schoolwide
school receives to make sure its 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 does this look like in
practice?
Example 1:
• A school district conducts a technology audit, which
shows Title I schools have computer labs, but nonTitle 1 schools do not
• The district reduces state/local allocations to Title I
schools in order to redirect state/local money to nonTitle I schools so they can by computer labs
Example 1 (cont)
Result
• The school district violates the supplemental
funds test because Title I schools are
deprived of state and local funds because
they receive Title 1
What does this look like in
practice?
Example 2:
• A school district meets the supplemental funds test
• State and local resources have declined, forcing
school leaders to make tough decisions about what to
keep and what to cut
• Most schools decide not to cut teaching positions
• Title I schools use Title I funds to retain teacher FTEs,
while non-Title I schools do so with state/local funds
Example 2 (cont)
Result
– This scenario does not violate the supplemental funds test
(but is likely to get scrutinized)
– The supplemental funds test looks at the overall level of
resources going into a school, and not for supplementary
services
– Here, the Title 1 Schools have extra resources non-Title I
schools do not have
» The non-Title1 schools had to cut other costs in order to
retain the teacher FTEs with state and local funds, cuts Title
1 schools did not have to make. Title 1 Schools should be
getting something extra with the extra dollars they have
flowing into the school
So what is the control to ensure
Title 1 funds are spent responsibly?
• All costs changed to Title 1 in a
schoolwide program must be:
– Consistent with the school’s needs
– Reasonably designed to improve student
outcomes
– Necessary and reasonable
What does this look like in
practice?
• A school district conducts a technology
audit to prepare for new computer-based
assessments aligned to common core.
The audit reveals a Title 1 school’s newly
purchased computers do not meet test
security requirements
– While a Title 1 school could, in theory, use
Title 1 to prepare for new state assessments,
in this case upgrading new computers may
not be a necessary or reasonable use of
funds
Teeing up the next steps
• Getting schools to schoolwide status:
– This guidance deals only with the supplemental
funds test and how that affects the use of funds in
a schoolwide
– It does not address other schoolwide
requirements such as conducting a
comprehensive needs assessment, or completing
a schoolwide plan
– Many states already have guidance on these
issues
• If so, will this be incorporated into the existing
guidance, or will it be a standalone document?
• If not, will the state develop such guidance?
Next steps (cont.)
• Use of funds:
– ED guidance supports a broad range of
activities that could be supported with Title 1
in a schoolwide program
– Does the state want to provide state-specific
guidance on use of funds?
• Are there specific kinds of costs the state wants to
promote?
• Are there specific kinds of costs the state does not
want to see?
Next Steps (cont.)
• Burden reduction opportunities:
– Use of funds in a schoolwide is driven by a
school’s needs assessment and plan
– Do schools already go through a needs
assessment and planning process that can satisfy
schoolwide requirements?
– SIG related process?
– State developed process?
– Accreditation process?
– Chartering process?
– District developed process?
Next Steps (cont.)
• State Oversight:
– What do these changes mean for how the state
will oversee school-level planning and spending?
– What’s the best way to balance oversight
responsibilities, burden and effective
administration
• Increased oversight at the front end (using the
application process)?
• Using existing process to help monitor fed rules
(reimbursement, financial reports, etc.)?
• Revamp back–end monitoring?
Next Steps (cont.)
• Supplemental funds test:
o What might this test look like in your state?
o What concerns might people have over this
guidance?
o What would be the best way to address those
concerns?
Supplement/Supplant
• Targeted Assisted – program level supplanting.
“Reasonable and necessary.” Very situationally
dependent
• Schoolwide – fiscal level supplanting only, but
must meet “intents and purposes.” School must
receive all the state and local funds it would
otherwise need to operate in the absence of
Federal funds. The per-pupil comparability
calculation assures this.
– Includes routine operating expenses such as
building maintenance and repairs,
landscaping and custodial services
Can Title I $ be used for basic
operational expenses?
• If only federal combined –
– No, must be for educational needs
• If federal and non-federal combined –
– No, but impossible to determine which is
federal
– Be sure sufficient state and local funds
allocated to school to meet basic operational
needs
What is “educational need”?
• Not addressed in guidance
– Instruction – yes
– Instructional support – probably yes
– Administration – possibly yes
– Operational – no
Closing thoughts
• The SWP is VERY important!
• Targeted versus SWP which is better?