Education Funding Explainer

How Can Districts Get More Time to Spend ESSER Dollars? An Explainer

By Mark Lieberman — April 11, 2024 4 min read
Illustration of woman turning back hands on clock.
  • Save to favorites
  • Print

Time is running out for school districts to spend their remaining federal COVID-relief dollars—unless districts successfully get approval to take a little longer.

Districts must still commit all their funds from the last, and largest, round of aid to specific expenses by Sept. 30. Under current law, they have an additional five months to “liquidate,” or spend, that money—transferring it from a district account to a vendor or employee by Jan. 31, 2025 for work completed before October 2024.

For each of the three rounds of pandemic-relief, or ESSER, funding from the federal government, the U.S. Department of Education has also opened an opportunity for “late liquidation” of up to 14 additional months beyond the original deadline.

Districts permitted to liquidate the last round of relief aid late could spend remaining ESSER funds as late as May 2026. They need to start preparing now for that possibility if they haven’t already, said Julia Martin, the legislative director for Brustein & Manasevit, a Washington law firm focused on education.

“It seems to be in [the federal department]’s interest to approve many of these extensions and maximize the impact of the funds, as well as the percentage spent,” Martin said. “But districts have to help them make that argument.”

Organizations that represent school superintendents have pushed for a broader deadline extension that gives districts more flexibility to wrap up their ESSER spending. But Congress is virtually guaranteed not to take up that request.

In the meantime, “late liquidation” offers a limited opportunity for districts to keep ESSER in the mix a little while longer. Here’s how it works.

Which expenses qualify for an extension?

The opportunity to spend ESSER funds past the deadline only applies to expenses tied to contracts. In a January 2024 letter, department officials emphasized support for continued investments in “increasing daily student attendance; providing high-quality tutoring; and increasing access to [before- and after-school learning] and summer learning and extended learning time.”

Teacher salaries, recruitment bonuses, and bulk purchases of laptops or textbooks are examples of expenses that are not eligible for extension.

How will a liquidation extension help?

It will give districts more time to spend money for a contract that extends past Jan. 31, 2025. That means they could keep a mental health service provider, a tutoring partner, or a construction company around for the remainder of the current school year and into the next one.

It will not, however, give districts more time to decide how to allocate their remaining dollars. Those decisions must be final as of Sept. 30.

Otherwise, districts will have to send their unallocated funds back to the U.S. Treasury.

How can districts get an extension?

Districts need to supply their respective state education departments with detailed information about the amount of money they need more time to spend, the necessary expenses, the justification for the proposed extension, and the plan for ensuring that the district spends the money in the correct time frame.

Then it’s the state’s responsibility to compile that information into a spreadsheet linked in this guide from the Council of Chief State School Officers. The state education department can also request an extension for the ESSER funds it received—10 percent of the state’s overall allocation from the federal government.

See Also

Illustration of a piggy bank with falling clocks entering the bank.
iStock/Getty

Some states—like Connecticut and New Hampshire—have already publicly posted detailed rules and expectations for districts seeking late liquidation requests.

Many others don’t appear to have anything on their ESSER web pages referring to late liquidation. Districts in those states will have to contact their education departments directly for more information.

What is the deadline to apply for an extension?

States can request an extension between now and Dec. 31, 2024—three months after the deadline to commit the funds and less than a month before the current deadline to liquidate them.

It remains to be seen how quickly the Education Department will process extension requests that come in close to the deadline.

As of April 11, no states have submitted applications for late liquidation of ESSER III dollars on behalf of districts, said Vanessa Harmoush, a spokesperson for the Education Department.

What happened with extensions for ESSER I and ESSER II?

The department granted every request from states that applied on behalf of districts for a liquidation extension for ESSER I and ESSER II, Harmoush said. No applications were rejected.

The department granted late liquidation for ESSER I to 10 states, Harmoush said: Connecticut, Illinois, Indiana, Mississippi, Nevada, North Carolina, Ohio, Pennsylvania, Texas, and Wisconsin. Puerto Rico and the District of Columbia also received extensions.

For ESSER II, 19 states along with Puerto Rico got extensions: Arkansas, California, Connecticut, Delaware, Florida, Illinois, Indiana, Kentucky, Massachusetts, Missouri, New Jersey, New Mexico, New York, North Carolina, Ohio, Rhode Island, South Carolina, Texas, and Vermont.

Does a deadline extension cover the staffing necessary to manage the grant until it’s completed?

No. Staff salaries are not eligible for late liquidation requests. That means the school district employee responsible for managing the grant must be compensated with funds other than ESSER dollars—even if they’re helping manage a contract funded by ESSER.

Can districts shift ESSER dollars to another expense if a contractor pulls out after the late liquidation period begins?

No. The obligation deadline stands firm on Sept. 30. If a district receives approval to take additional months to liquidate funds for a particular contract, and that contract falls apart for whatever reason, the district can no longer use the funds that were set aside for that purpose.

Related Tags:

Events

This content is provided by our sponsor. It is not written by and does not necessarily reflect the views of Education Week's editorial staff.
Sponsor
Budget & Finance Webinar
Innovative Funding Models: A Deep Dive into Public-Private Partnerships
Discover how innovative funding models drive educational projects forward. Join us for insights into effective PPP implementation.
Content provided by Follett Learning
Budget & Finance Webinar Staffing Schools After ESSER: What School and District Leaders Need to Know
Join our newsroom for insights on investing in critical student support positions as pandemic funds expire.
This content is provided by our sponsor. It is not written by and does not necessarily reflect the views of Education Week's editorial staff.
Sponsor
Student Achievement Webinar
How can districts build sustainable tutoring models before the money runs out?
District leaders, low on funds, must decide: broad support for all or deep interventions for few? Let's discuss maximizing tutoring resources.
Content provided by Varsity Tutors for Schools

EdWeek Top School Jobs

Teacher Jobs
Search over ten thousand teaching jobs nationwide — elementary, middle, high school and more.
View Jobs
Principal Jobs
Find hundreds of jobs for principals, assistant principals, and other school leadership roles.
View Jobs
Administrator Jobs
Over a thousand district-level jobs: superintendents, directors, more.
View Jobs
Support Staff Jobs
Search thousands of jobs, from paraprofessionals to counselors and more.
View Jobs

Read Next

Education Funding When There's More Money for Schools, Is There an 'Objective' Way to Hand It Out?
A fight over the school funding formula in Mississippi is kicking up old debates over how to best target aid.
7 min read
Illustration of many roads and road signs going in different directions with falling money all around.
iStock/Getty
Education Funding Education Dept. Sees Small Cut in Funding Package That Averted Government Shutdown
The Education Department will see a reduction even as the funding package provides for small increases to key K-12 programs.
3 min read
President Joe Biden delivers a speech about healthcare at an event in Raleigh, N.C., on March 26, 2024.
President Joe Biden delivers a speech about health care at an event in Raleigh, N.C., on March 26. Biden signed a funding package into law over the weekend that keeps the federal government open through September but includes a slight decrease in the Education Department's budget.
Matt Kelley/AP
Education Funding Biden's Budget Proposes Smaller Bump to Education Spending
The president requested increases to Title I and IDEA, and funding to expand preschool access in his 2025 budget proposal.
7 min read
President Joe Biden delivers remarks on lowering prices for American families during an event at the YMCA Allard Center on March 11, 2024, in Goffstown, N.H.
President Joe Biden delivers remarks on lowering prices for American families during an event at the YMCA Allard Center on March 11, 2024, in Goffstown, N.H. Biden's administration released its 2025 budget proposal, which includes a modest spending increase for the Education Department.
Evan Vucci/AP
Education Funding States Are Pulling Back on K-12 Spending. How Hard Will Schools Get Hit?
Some states are trimming education investments as financial forecasts suggest boom times may be over.
6 min read
Collage illustration of California state house and U.S. currency background.
F. Sheehan for Education Week / Getty