Introduction to Title I Fiscal Requirements

Presented by Kristen Tosh Cowan, Esq.

Brustein & Manasevit, PLLCktoshcowan@bruman.com

Spring Forum 2011

Overview

1) LEA-to-School allocations2) Set asides3) Equitable Services allocation 4) Carryover 5) Comparability6) Reauthorization Predictions

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Resources -- Allocations

Statute Section 1113

Regulations 34 CFR §200.77-78

Non-regulatory Guidance August 2003

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Resources – Cross-cutting

“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 Continue if served last year But, only continue for one year

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5 Poverty Measures:

1. Census data2. Free and reduced 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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Exception: NO Rank & Serve if

Small LEA exclusion If <1000 students

One school at each gradespan

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STEP 3: SERVE SCHOOLS STRICTLY IN ORDER OF RANK

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Allocation to Schools BUT first, calculate 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 school based on poverty

. . . To student based on academics

“125 Percent” Rule

If serve any school <35% Then PPAs for all schools must be

at least 125% of LEA’s PPA under Title I allocation Entire LEA Title I-A Grant # of low income on census

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EXAMPLE:

$1,000,000 total Title I grant 2,000 poverty students

= $500/ student PPA

If serve school <35% poverty, $500 x 1.25 = $625 PPA

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Exception: Rank & Serve “Skip” school, if:

1. Comparability met2. Receiving supplemental state/local

funds used in Title I-like program3. Supp. State/local funds meet or exceed

amount would be received under Title I

Still count and serve nonpublic in area

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Title I Set-Asides

LEA MUST reserve specific percentage:

20% choice transportation and SES 1% parental involvement 10% professional dev (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!

Calculating % set asides

Take off entire LEA grant Transferability:

Includes transferred amounts Carryover:

Does not include carry over (apply % only in first year available)

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Example

Title I, Part A = $500,000 Transferred $30,000 from Title II Carried over $50,000 from prior

year

Each % set aside applies to $530,000

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Funds for Supp Ed Services and 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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If no SES, then 20% on choice

If no choice, then 20% on SES

If both, then minimum of 5% for choice, 5% for supp services, and 10% for either

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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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“Amount equal to 20%” May use Title I, Part A; school

improvement (sect. 1003); ARRA transferability

State, local, or private funds

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If use Title I Funds, from where?

Off the top of LEA allocation OR from individual school allocations? Both permitted If school in corrective action or

restruct, <15%

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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 extent practicable, with outside groups (CBO, FBO, etc.)

2. Send timely, accurate notice to parents

3. Ensure SES sign-up forms given directly to all eligible students/ parents

4. 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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SEA monitors 20% compliance through: (200.48(d)(3))

Regular monitoring (on multi-year cycles) Ensure 6 criteria are met

More frequent monitoring For LEAs that have spent “significant portion” of

20% on other activities AND subject of “multiple complaints, supported by credible evidence,” regarding implementation of choice or SES

SEA must complete its review by the beginning of the next school year

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Consequences for non-compliance200.48(d)(4)

If SEA finds LEA did not meet all 6 criteria, then LEA must in the subsequent year: Spend amount equal to the remainder

of 20% in the subsequent year on choice/ SES, in addition to new 20%, OR

Meet all 6 criteria and obtain permission from the SEA before spending less than full 20% in subsequent year.

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How to reallocate?

If took school allocations, then reallocated to those schools

Subject to equitable participation of private school students

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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

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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 sch area

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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 attend areas, 5% are private

5% of $500,000 to private allocation

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Applies to: Summer school After school programs Reading coaches

DOES NOT APPLY TO: SES/ Choice (20%) Preschool

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Reservation for teachers and families

If LEA reserves funds for parental involvement or professional development

Then proportional amount to nonpublic

34 CFR sect 200.65(a)

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Example LEA reserves 1% of $500,000

allocation for parental involvement, or $5,000.

Of all low-income families residing in participating attend area, 6% are private. Then 6% of $5,000 used for families of participating private school students.

Carryover

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

Reallocated by state if exceeds

Waiver

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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

Heightened Federal Scrutiny on Comparability!!

Common finding of USDE Program Reviewers

Many serious findings in OIG Audits Focus of “equity” initiatives

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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.

Reasonable variance is ok (10%)

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If all are Title I schools, all must be “substantially comparable.”

Reasonable variance ok (>10%)

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Timing

Common Finding!

Guidance: Must be annual determination

Review for current year and make adjustments for current year

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Written Assurances

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”

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Demonstrate “equivalence achieved” through:

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)

Need only meet under 1 approach

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How to measure??

Compare: Average of all non-Title I schoolsto Each Title I school

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For example: Using student/ instructional staff ratios Average of all

non-Title I schools = 10:1

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

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Basis for evaluation: Compare: Grade-spans Large schools Small schools

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Does not apply if LEA has:

Only 1 school Only 1 school at each gradespan

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Exclusions:

Federal Funds Private Funds

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Exclusions:

Need not include unpredictable changes in students enrollment or personnel assignments that occur after the start of a school year

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

Language instruction for LEP students

Excess costs of providing services to students with disabilities

Supplemental programs that meet the intent and purposes of Title I

Staff salary differentials for years of employment

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Who is “instructional staff”? Consistent between Title I and

non-Title I

Teachers (art, music, phys ed), guidance counselors, speech therapists, librarians, social workers, psychologists

Paraprofessionals – ED: up to SEA/ LEA

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How to calculate in a SWP?

Problem (theoretically): Cannot exclude state and local funds Cannot identify teachers paid with

state and local funds Use (non-federal) expenditures per

student

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How to calculate with charter schools?

Charters must be included (if not independent LEAs)

Problem: No LEA control over staffing

Use (non-federal) expenditures per student

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How will Reauthorization impact Title I Fiscal Requirements?

Reauthorization Predictions

Comparability Close loophole of excluding salary

differential to reflect seniority Move to measuring non-federal

expenditures/ student Supplement not Supplant

Change to reviewing total amount of funding, not individual expenditure?

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Reauthorization Predictions

Choice/ SES – Unlikely 20% minimum mandate One option of many Target to underperforming subgroup

Financial incentives for teachers and students

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Reauthorization Predictions

No significant changes to: Ranking & serving rules Equitable services Consolidating funds in schoolwides Time & effort

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This presentation is intended solely to provide general information and does not constitute legal advice or a legal service.  This presentation does not create a client-lawyer relationship with Brustein & Manasevit, PLLC and, therefore, carries none of the protections under the D.C. Rules of Professional Conduct.  Attendance at this presentation, a later review of any printed or electronic materials, or any follow-up questions or communications arising out of this presentation with any attorney at Brustein & Manasevit, PLLC 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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