1. Introduction to Title I, Part A Fiscal Requirements
Presented by
Tiffany R. Winters, Esq.
Brustein & Manasevit, PLLC
Spring 2012 Forum

2. Overview W 1) LEA-to-School allocations 2) Set asides
3) Equitable Services allocation
4) Carryover
5) MOE
6) Comparability
7) Supplement not Supplant W

3. Valuable Legal Resource
“Title I Fiscal Issues” Feb. 2008
fiscalguid.doc
Consolidating funds in schoolwide programs, MOE, SNS, Comparability, Grantbacks, Carryover

4. 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

5. Step 1: Identify Eligible Schools

6. 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

7. LEA Discretion: Eligibility
“35 Percent Rule”
May designate as eligible
Must still serve in order

8. 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

9. 5 Poverty Measures: Census data Free and reduced price lunch TANF
Medicaid eligibility
Composite of above

10. Step 2: Rank Eligible Schools in order of poverty

11. Ranking and Serving Exceeding 75% poverty At or below 75% poverty
Strictly by poverty
Without regard to gradespan
At or below 75% poverty
May rank by gradespan

12. 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%

13. Step 3: serve schools STRICtLY in order of rank

14. 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

15. 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

16. 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
$95,000
Roosevelt Elementary
79% 40
$1,000
$40,000
Scott Elementary
74% 56
$56,000
Toshiba Elementary
59%
119
$119,000
Brennan Elementary
49% 92
$92,000
Key Middle School
58% 47
$47,000
Washington High School
70%
160
n/a

17. Ranking with Skipping 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
$95,000
Roosevelt Elementary
79% 40
$50,000
Scott Elementary
74% 56
$70,000
Toshiba Elementary
59%
119
$148,750
Brennan Elementary
49% 92
$115,000
Key Middle School
58% 47
n/a
Washington High School
70%
160

18. Exception: Rank & Serve
“Skip” school, ONLY if:
Meet Comparability;
Receiving supplemental State/local funds used in Title I-like program; and
Supplemental State/local funds meet or exceed amount that would be received under Title I
Still count and serve nonpublic in area 18

19. Title I Set-Asides W

20. LEA MUST reserve specific percentage:W
20% choice transportation and SES
1% parental involvement
5% for teacher and paraprofessional qualifications
10% professional development
(if LEA ID) W W

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

22. LEA MAY reserve: Incentives to teachers in ID schools (<5%)
Professional development
“other authorized activities”
Summer school
Preschool
Districtwide program

23. DON’T CIRCUMVENT “RANKING AND SERVING” RULES!
CAUTION:
DON’T CIRCUMVENT “RANKING AND SERVING” RULES!

24. Funds for Supplemental Education Services & Choice TransportationW
Amount equal to 20% of LEA allocation
(unless lesser amount needed)
To pay transportation for choice
To satisfy all requests for SES services
Both

25. Credit for “Parent Outreach”W
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 25

26. 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

27. W
Use 20% “unless a lesser amount is needed” How do you know if less is needed? 27

28. To spend less than 20%, LEA must: 200.48(d)(2)(i)W
Partner, to the extent practicable, with outside groups (CBO, FBO, etc.)
Send timely, accurate notice to parents
Ensure SES sign-up forms given directly to all eligible students/parents
Ensure SES sign-up forms made widely available through broad dissemination (internet, other media, public agencies) 28

29. W
Provide (at a minimum) two enrollment windows at separate points in school year of sufficient length
Ensure SES providers are given access to school facilities, using a fair, open and objective process, on same basis as others

30. Does LEA need SEA’s permission before reallocating the 20%?W
Does LEA need SEA’s permission before reallocating the 20%?
NO!

31. LEA must document and notify SEA!W
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

32. 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

33. Equitable Services for Private School Students

34. Equitable Services: Deriving Allocation
General Formula:
Based on number of:
Private school students
From low-income families
Who reside in Title I-participating public school attendance areas

35. Calculate Allocation for Instruction:
Identify eligible school attendance areas
Rank in order of poverty
Strictly serve in rank order (i.e., ID who is “Participating Public School”)
Calculate PPA for each area
Derive allocation amount for each area
Must include nonpublic low-income #
Reserve nonpublic amount
PPA x # of nonpublic low-income students who reside in participating public school area

36. 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 20
PPA
$1,500
Equitable Services Set-Aside
$30,000

37. Distributing the Funds37
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

38. 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 (a)(2)(i)(A)

39. 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

40. 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)

41. 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)

42. Carryover

43. 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

44. Use of Carryover Funds Flexible 3 Options:
Put back in LEA formula & redistribute
Designate for particular LEA activities
(Allow school to retain)
Cannot use in ineligible school

45. 3 Pillars of Fiscal Accountability
Maintenance of Effort
Supplement not Supplant
Comparability

46. Most Directly Affected by Declining Budgets
Maintenance of Effort
Most Directly Affected by Declining Budgets

47. MOE: The NCLB Rule
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

48. MOE: Preceding Fiscal Year (PFY)
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 ( ) to second PFY ( )

49. 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

50. 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
Actual amount
$850,000
$5,200
Shortfall
-$50,000
-$290
Percent shortfall
** reduction in all ESEA programs
-5.6%
-5.3%**

51. MOE: Waiver USDE Secretary may waive for State
Exceptional or uncontrollable circumstances such as natural disaster OR
Precipitous decline in financial resources of the LEA

52. July 2009 Draft Non-Regulatory Guidance
SEA may apply for waiver on behalf of LEAs

53. Comparability May not be affected by declining non-federal revenue,
if treat all schools equally

54. General Rule – Section 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.”

55. Timing Issues Guidance: Must be annual determination
Review for current year and make adjustments for current year

56. 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”

57. How to show equivalence achieved?
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)

58. How to measure?? Compare:
Average of all non-Title I schools to each Title I school

59. 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

60. Basis for evaluation:
by similar grade-spans or
by similar size school

61. 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

62. Exclusions: LEA may exclude state/local funds expended for:
Staff salary differentials for years of employment

63. Who is “instructional staff”?
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

64. Supplement Not Supplant

65. Supplement not Supplant
Federal funds must be used to supplement and in no case supplant state and local resources

66. Auditors’ Tests for Supplanting
“What would have happened in the absence of these federal funds??”
OMB Circular A-133
Compliance Supplement

67. 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.

68. 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!

69. 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

70. 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)

71. Can you rebut this presumption?
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

72. Rebuttal Example State supports a reading coach program 2010 -2011
State cuts the program from State budget
LEA wants to support Title I reading coach program

73. Rebuttal Example LEA must document State cut the program
LEA does not have uncommitted funds available in operating budget to pick up
LEA would cut the program unless federal funds picked it up
The expense is allowable under Title I

74. Exception: 1120A(d) 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

75. Supplanting in a schoolwide program

76. Supplement not Supplant
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.

77. Questions??

78. 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.