American Recovery and Reinvestment Act of 2009 (ARRA)

1. American Recovery and Reinvestment Act of 2009 (ARRA) Impact on Districts Receiving Title I, Part A Funds JoLynn Berge – Cal Brodie – Petrea Stoddard

2. American Recovery and Reinvestment Act State Fiscal Stabilization Funds Increases to Formula Grants Governor’s Portion $1.0B WA State U.S. Dept. of ED Secretary’s National Amount • Title I-A Allocation ($135.3 M) • School Improvement Grants (1003 (g) Funds) • Educational Technology Grant • Homeless Grant • IDEA, Part B & 619 • 18.2% • $182.4 M • Used for Public Safety Initiatives – can be used for education • 81.8% • $819.9M • Distributed between K-12 and Higher Education to cover budget shortfalls • Based on State Funding Formulas • Competitive Grant Applications • Based on how well the state has used the Governor’s Portion of the Stabilization Funds • Innovative Grants • Competitive • $650 M • Direct to school districts from U.S. Dept of ED • Incentive Grants • Competitive • $4.35 B • Awarded to States • Leftover Funds – those funds that were not needed to cover budget shortfalls • Funds will be distributed to LEAs based on their portion for the Title I Allocations • NOT Title I Funds – can be used for activities under ESEA, IDEA, Perkins, or for Building Modernization

3. Purpose • Provide additional assistance to high poverty schools to • improve instruction and learning, and • close the achievement gap [A-1]

4. Guiding Principles • Spend funds quickly to save and create jobs • Improve student achievement through school improvement and reform • Ensure transparency, reporting and accountability • Invest ARRA one-time funds thoughtfully to minimize the “funding cliff” [A-1]

5. Considerations • Implement evidence-based strategies to help build sustainable capacity for improving teaching and leaning • Consider early childhood education • Consider programs serving secondary schools [A-2]

6. 2009 Funds • Title I, Part A ARRA funds are in addition to regular Title I, Part A allocation • Separate CFDA Numbers • 84.010A=Regular Title I, Part A allocation • 84.389A=ARRA Title I, Part A funds • State must inform districts of amount of each • Hold harmless rates based on total of both [A-2, A-4]

7. Basis of Allocation/Eligibility • ½ Target Grants [1125(a)(1)] • ½ Education Finance Incentive Grants (EFIG) [1125A(c)] • Same criteria—Per 2007 Census data, October 2008 caseload data for N and D students, and October 2007 caseload data for foster and temporary aid to needy families (TANF) • At least 10 formula children • Formula children = at least 5% of 5-17 population [A-5-9, Section B]

8. Maintenance of Effort • Applies—[Sections 1120A and 9521] • With in 90% of preceding fiscal year for • Combined fiscal effort per student, or • Aggregate expenditures • May request waiver once every 3 years [1127] [C-1,Non Regulatory Guidance, Title I Fiscal Issues, ESEA1120A]

9. Maintenance of Effort • ED Secretary may approve waiver for state and/or districts to consider State Fiscal Stabilization Funds (SFSF) as state funds • Expenditures in 2009-10 would first affect MOE in 2011-12 • Even with waiver, remain Federal funds for • Comparability • Supplement Not Supplant • Reporting and Recordkeeping [C-1-7, ARRA Section 14012(c-e), ESEA 1120A]

10. Supplement Not Supplant • Title I, Part A funds subject to SNS requirements • 1120A(b) and (d) • 1114(a)(2)(B) • Rebuttals and use of exclusion may be applied where appropriate • Note: Supplement not supplant for Title I, Part A regular and ARRA funds but not for SFSF funds [C-8-10]

11. Supplement Not Supplant • What would the district do if there were no Title I, Part A Federal funds? • Supplanting if • Activity is required by local, state or other Federal law • District conducted activity in prior year with non-Federal funds • District uses non-Federal funds to provide same activity for non-Title I students or in non-Title I schools [C-8-10, 1120A]

12. Supplement Not Supplant • Rebuttal possible if • Can demonstrate source of funds significantly reduced or eliminated • Can demonstrate educational priorities for use of non-Federal funds has changed • Activity allowable under Title I, Part A program requirements • Use of Title I, Part A funds meets general standards of OMB Circular A-87 • Documentation contemporaneous with decision—Not after the fact [C-8-10, 1120A]

13. Supplement Not Supplant • State Fiscal Stabilization Funds are Federal funds and do not need to be taken into consideration when determining SNS [C-10]

14. Comparability • Applies to ARRA Title I, Part A funds • State Fiscal Stabilization Funds are not included because they are Federal, not state or local funds [C-11-12, ESEA 1120A]

15. Period of Availability • Title I, Part A ARRA funds are FY 2009 funds • Initial period of availability through September 30, 2010 (85% unless waiver) • Remaining (15% or less) by September 30, 2011 • See 34 CFR 76.707 for obligation chart [C-13, NCLB Section 1127, 34 CFR Section 76.707]

16. Carryover • Title I, Part A carryover rules apply • At least 85% must be obligated by September 30, 2010 • Remainder is consider carryover and must be obligated by September 30, 2011 • Districts may apply for a waiver from this requirement no more often than once every 3 years [ESEA Section 1127, 34 CFR Section 76.707, C-13-17 & 19]

17. Carryover • Carryover provisions apply ONLY to the Title I, Part A Recovery and Regular funds • School Improvement funds under Section 1003(a) and (g) are not subject to the carryover provision [C-18]

18. Carryover • OSPI will be requesting a waiver of the ESEA Section 1127 carryover requirement [C-20]

19. Cash Management • Cash management rules apply • Not an issue if districts submit expenditures on reimbursement basis [C-21, 31 CFR Section 205, 34 CFR Section 80.21(b) & (i)]

20. Indirect Costs • Use the restricted indirect rate for 2009-10 • Rates are available on iGrants • Adjustments may be needed during the year OSPI will monitor this [C-22]

21. Requirements • Title I, Part A Recovery funds are subject to • All applicable ESEA requirements, • Title I, Part A regulations • Other applicable laws and regulations • Applicable OMB Circulars • A-87—Allowable Costs • A-133—Audit Requirements [D-1]

22. Reservations (Set Asides) • The following Title I, Part A set asides apply • Comparable services to homeless students [1113(c)(3)(A)] • Comparable services to neglected and delinquent children living in institutions or community day school programs [1113(c)(3)(B)] • Financial incentives for teachers (optional) • Limited to 5% of allocation [1113(c)(4)] • Equitable services to eligible private school children, teachers and parents [9401(c)(5) and non-regulatory guidance (requires consultation prior to allocation) [D-2-7]

23. Reservations (Set Asides) • At least 10% of school’s allocationfor professional development for schools in Step 1 or above [1116(b)(3)(A)(iii)(I)] • At least 10% of the district’s allocation for professional development if the district is in Step 1 or above [1116(c)(7)(A)(iii)] • At least 1% of district allocation for parent involvement activities if allocation is over $500,000 [1118(a)(3)(A)] • Up to 20% of district allocationfor transportation for public school choice (Step 1 and above) and supplemental educational services (Step 2 and above), if sufficient demand, for schools [1116(b)(10)] [D-9]

24. Reservations (Set Asides) • Set asides must take both regular and recovery Title I, Part A funds into consideration when determining if set asides apply • For example, to determine if 1% parent involvement applies add both Title I, Part A funding sources together, if over $500,000 set aside applies [D-10]

25. Waivers • ED recommends waivers be submitted after the guidance is available to ensure the requests contain all relevant information • There is no requirement to apply for any waiver • Waivers will be in effect for the two years the funds are available for obligation [F-1, F-4, F-5, ESEA Section 9401(c)]

26. Waivers • OSPI will request waivers allowable for certain set asides • Some set asides may NOT be waived • Homeless • Neglected and/or delinquent • Parent involvement • Equitable share to eligible private schools [D-11]

27. Not Eligible for Waiver • In addition to the set asides discussed previously, the following requirements may NOT be waived • Allocation and distribution of funds • Comparability of services • Use of Federal funds to supplement not supplant non-Federal funds • Civil rights requirements • Prohibitions regarding • State aid [Section 9522], • Use of funds for religious worship or instruction [9505] • Activities [9526]

28. Not Eligible for Waiver • Ranking and allocating of funds to schools [1113(a) and (b)] • Note: ED may waive maintenance of effort requirements [1125A(e)(3), 9521(c)] [F-5]

29. Waivers Requested • OSPI has or plans to request the following waivers as permitted for the Title I, Part A Recovery funds • At least 10% of district allocation and 10% of school allocation for professional development for districts and/or schools in improvement • Up to 20% set aside for transportation for public school choice and SES for schools in improvement • Inclusion of Title I, Part A ARRA funds in determining per-child amount for SES • Carryover cap of no more than 15% every three years • Maintenance of effort requirements [D-11, 13-14]

30. Funding for Schools • Ranking and allocation rules under Title I, Part A apply to Title I ARRA funds • Additional eligible schools may be reached • Regular and ARRA Title I, Part A funds considered together in determining per pupil allocations [D-15]

31. Allocations to Schools in Improvement • District may not reduce the Title I, Part A allocation to a school identified for corrective action or restructuring by more than 15% when reserving funds for public school choice and SES [D-12, ESEA 1116(b)(10)(D)]

32. Ranking and Allocating • Ranking and allocation rules apply to regular and ARRA Title I, Part A funds • Both sources must be considered in the per pupil amounts • Eligible schools not previously served could be reached [D-15, ESEA Section 1113, 34 CFR Section 200.78]

33. Civil Rights • Receipt of federal funds requires compliance with all civil rights laws that prohibit discrimination [D-16, Notice on Civil Rights Obligations Applicable to the Distribution of Funds under the American Recovery and Reinvestment Act of 2009]

34. State Reporting Requirements • Detailed information on State and district use of Title I, Part A Recovery funds will be required in quarterly reports and made public at www.Recovery.gov • State reporting will include • Total amounts of Title I, Part A ARRA funds received and expended or obligated • Project/activity name, description and evaluation of completion status on which Title I, Part A ARRA funds were used • Estimate of number of jobs saved or created with Title I, Part A ARRA funds • Report due no later than ten days after initial calendar quarter in which State first receives Title I, Part A ARRA funs or July 10, 2009 • ED is developing a common reporting form • Additional guidance is expected—soon [E-1, Section 1512 of ARRA]

35. District Reporting Requirements • Each district which receives Title I, Part A ARRA funds must file a school-by-school listing of its per-pupil education expenditures from State and local sources during the 2008-09 school year • Due to OSPI by December 1, 2009 • OSPI must report to ED by March 31, 2010 [E-3]

36. Accounting for Title I ARRA Funds • Separate reporting requirements for Title I, Part A ARRA funds and regular Title I, Part A funds, therefore, districts must • Account and report for separately • Different CFDA Numbers • Title I, Part A regular = 84.010A • Title I, Part A ARRA = 84.389A • Must maintain accurate, complete and reliable documentation for all ARRA expenditures • Information on fund uses publicly available on www.Recovery.gov [E-4-5]

37. Monitoring of ARRA • OSPI must monitor grant activities to ensure compliance with all applicable Federal requirements • ARRA Recovery Act Accountability and Transparency Board will oversee compliance • Instances of potential fraud, waste and abuse must be reported promptly at 1-800-MIS-USED or oig.hotline@ed.gov [E-5, Section 1553 of ARRA]