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E.D. Won't Fault Grantees for Breaking Old Rules

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Washington

State auditors are now evaluating state agencies and school districts that received federal money in the 1994-95 school year to determine if they complied with federal rules. But the Clinton administration has essentially decided not to enforce certain rules that changed after the new Elementary and Secondary Education Act went into effect last July.

Grant recipients under the affected programs--Title I compensatory education, migrant education, bilingual education, and the block grant formerly known as Chapter 2--were required to comply with the old ESEA rules in 1994-95, and they have not officially been waived. But because the new ESEA enacted several changes to those programs, auditors have been told not to monitor compliance on those counts during the last year the old rules were in effect. (See box, this page.)

Hugh Monaghan, the department's inspector general for five mid-Atlantic states and the District of Columbia, said the Clinton administration has eliminated auditing requirements "that are no longer material, where policymakers ... have changed the law."

Most notably, auditors are no longer being asked to make sure that school districts have evaluated the effectiveness of their Title I programs at least once in the past three years and that states have conducted similar evaluations once in the past two years.

But states still must acquire evaluation data from districts and pass it along to federal officials, even though auditors will not ask about it, said Mary Jean LeTendre, the director of the department's office of compensatory education.

She said the evaluation requirement was dropped from the audits because it has lost its relevance now that states and districts are moving from traditional, norm-referenced tests for Title I to multiple forms of assessment called for in the 1994 amendments to the esea.

'Cooperative' Initiative

The audit changes for the 1994-95 period are part of a broader effort to transform federal auditing of school programs. The shift is from an accountability process focused on strict compliance with federal rules to one based on improvement in student performance, department officials say.

The department's "cooperative audit resolution and oversight" initiative calls for permanent revision of audit requirements. Department officials are further updating the requirements to reflect the new esea, which includes many provisions that give states and districts greater flexibility in using federal education dollars as well as new requirements tying federal programs to the establishment of academic standards and accompanying assessments. A final version is to be released in May, Mr. Monaghan said.

Coordinating federal auditing, monitoring, and technical-assistance efforts is another aim of the initiative. Auditors will share their findings with department officials charged with providing assistance to states, Mr. Monaghan said.

In addition, three states--Flor-ida, Mississippi, and Washington--are participating in a pilot program under which issues identified in audits from previous fiscal years are being resolved all at once rath-er than on a case-by-case basis.

"It's been a whole different attitude," said Ralph Sharp, the education-policy director for the Florida Department of Education. "They're helpful and willing to work with us, which is different from the approach of the office of inspector general in the past."

He said the pilot program has spurred the federal agency to resolve audit issues lingering from as long ago as fiscal 1991.

All three unresolved state-level audits pending in Mississippi are in the process of being closed, according to Paul Baggett, the director of the internal-accountability office of the state education department.

"I don't know what's going to come of this, but I am real pleased that the initiative has come down from Washington, so to speak," Mr. Baggett said. "It's a start, if nothing else. But I think it's going to be more than that."

'Supplement, Not Supplant'

One observer said there may be a down side to the audit changes.

Phyllis C. McClure, an education consultant and a member of a congressionally mandated review panel studying implementation of the Title I revisions, said that as states integrate Title I with their overall reform efforts, the law's requirement that federal dollars "supplement, not supplant" state and local funds could be harder to enforce. It aims to prevent states or districts from using Title I money to provide services they otherwise would have paid for themselves, rather than providing extra services.

"What's really imperative is the department has to provide some sound guidance as to what constitutes 'supplanting' under the new Title I and what doesn't," Ms. McClure said.

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