Special Education

Feds Back Off on Easing Special Ed. Funding Restriction

April 11, 2012 5 min read

The U.S. Department of Education this month took back an offer it made to school districts last summer that would have let them cut special education spending permanently, with only a one-time penalty, and for reasons other than existing exemptions in federal disability education law.

The federal “maintenance of effort” clause has been built into special education spending rules to buffer students with disabilities from changes in services triggered by the ups and downs of public spending and politics. Under that clause, states and districts must increase spending or keep it level from year to year. Violating the rules can lead to the loss of federal dollars awarded to states under the Individuals with Disabilities Education Act.

In a letter to the National Association of State Directors of Special Education last June, however, the Education Department signaled a shift in its thinking on the matter. To the alarm of many in the special education community, the department said that if districts lowered their special education spending for any reason, whether or not it was because of exceptions built into the law, districts didn’t have to resume spending at the previously higher level. Instead, districts could use the lower rate of spending as their new benchmark for future special education budgeting. (“Rules Relaxed on Budget Cuts to Special Ed.,” Sept. 14, 2011.)

The letter prompted an unrelenting outpouring of criticism from special education advocates and parents, and this month, the department’s Office of Special Education said it is withdrawing last summer’s letter.

“After further review, we have determined that the level of effort that a [school district] must meet in the year after it fails to maintain effort is the level of effort that it should have met in the prior year, and not the [district’s] actual expenditures. We are, therefore, withdrawing the letter,” wrote Alexa Posny, the assistant secretary for the office of special education, and Melody Musgrove, director of the office of special education programs in an April 4 letter.

Backtracking ‘Warranted’

In a statement, Ms. Posny said, “The department takes very seriously the needs of children with disabilities and appreciates the feedback we received from interested parties on this issue. As part of our ongoing responsibilities in administering the IDEA, and upon further review, we determined that this action [withdrawing the letter] was warranted.”

The now-retracted letter said that a district “is not obligated to expend at least the amount expended in the last fiscal year for which it met the maintenance-of-effort requirement. In other words, each year’s [district] maintenance-of-effort obligation is based on the actual amount expended in the immediate prior fiscal year,” Ms. Musgrove wrote.

The new letter says the only way districts can cut spending without penalty is for the existing exceptions. One of those exceptions is when a district experiences an actual decrease in expenses, such as when an experienced, highly paid special education teacher retires or a high-needs student leaves a district.

The department’s retraction was in response in part to a letter from Kathleen B. Boundy, a co-director of the Center for Law and Education, a Boston-based advocacy and research group. She challenged the department’s position and asked that the guidance be rescinded.

“We are thrilled with this reversal. It is a tribute to all of the parents, advocates, and attorneys who worked to communicate to [the office of special education programs] and Congress about the inaccuracy of this guidance,” said Candace Cortiella, who is the director of the Advocacy Institute and runs IDEA Money Watch, which tracks special education spending under the federal law.

The backtracking may be unwelcome by other groups, however. Last year, the American Association of School Administrators heralded the department’s effort to loosen maintenance-of-effort requirements.

“Maintenance of effort is especially difficult now,” said Sasha Pudelski, the government affairs manager for the Alexandria, Va.-based AASA. Districts are working through state budget cuts and the end of federal stimulus dollars, she said. “It’s not necessarily practical in the situation we’re in now.”

As an example, she said one superintendent in Alabama hoped to maximize resources by using a bus that picks up special education students for other bus runs, too. Because the savings would decrease the amount of money spent on special education, his district would be penalized for doing so, Ms. Pudelski said.

Title I Rules

Rules about keeping spending level aren’t unique to special education. Title I, the federal program for disadvantaged students, has similar rules. But Ms. Pudelski said districts have to keep Title I spending at a minimum of 90 percent of what it was the year before, compared with a 100 percent requirement for special education. That’s the kind of flexibility special education budgets need, she said.

In Michigan, where new state laws require teachers to contribute to their health care and retirement plans, districts are able to reduce expenditures in those areas, said Jennifer Burton, the special education director in the 47,000-student Washtenaw County district, which oversees special education for the school districts within its borders.

“It looks like the budget is decreasing,” Ms. Burton said. The state is also giving districts incentives to combine positions.

“We’re consolidating things that don’t directly affect students. I understand that we don’t want to spend less on kids with disabilities. Kids need what they need,” she said. But when districts cut costs that don’t affect students’ day-to-day lives, there should be exceptions to maintenance of effort for that, she added.

At least one district in Washtenaw expects it will not be able to keep special education spending level for the next school year. The district is bracing for the loss of federal special education dollars as a result, Ms. Burton said.

For its part, the National Association of State Directors of Special Education, which triggered all of the back and forth about district special education spending rules, said it is comfortable with the Education Department’s new position.

“We understand that a lot of other folks in the disability community were upset with the [office of special education programs’] interpretation,” said Nancy Reder, the Alexandria, Va.-based group’s deputy executive director. “We think the revision makes sense.”

Whether there will be future flip-flopping on this issue remains to be seen. The Education Department’s retraction letter also said it plans to seek comments from the public on this issue.

Nirvi Shah, Writer contributed to this article.
A version of this article appeared in the April 18, 2012 edition of Education Week

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