Excerpted from Department of Education memo “American Recovery and Reinvestment Act (ARRA) Guidance for Title I and IDEA – REVISED”  (pp. 9 & 10) from Gerald Vernotica, Deputy Commissioner Field Services,  to:  District Superintendents Charter School Leaders Nonpublic School Directors, Distribute to School Business Administrators, Other Staff as needed; dated 4-17-09/see DOE website homepage under ARRA information 

_________________________________________________________________________________

Fiscal Guidance

All provisions that currently apply to IDEA funds also apply to the IDEA Part B ARRA Funds. An LEA (local education agency) must use IDEA Part B ARRA funds only for the excess costs of providing special education and related services to children with disabilities, except where IDEA specifically provides otherwise:

Reduction of Maintenance of Effort

• Under certain circumstances an LEA may be able to reduce the level of State and local expenditures otherwise required by the IDEA LEA maintenance of effort (MOE) requirements. Under section 613(a)(2)(C), in any fiscal year that an LEA’s IDEA allocation exceeds the amount the LEA received in the previous year, the LEA may reduce the level of State and local expenditures by up to 50 percent of the amount of the increase, as long as the LEA uses those freed-up local funds for existing or new activities that could be supported under the ESEA.

If an LEA takes advantage of this provision, the required MOE for future years is reduced consistent with the reduction it took, unless the LEA increases the amount of its State and local expenditures on its own. The NJDOE encourages LEAs that can and do take advantage of this flexibility to focus the freed-up local funds on one-time expenditures that will help the State make progress on ARRA core reform goals such as improving the equitable distribution of effective teachers and the quality of assessments. The NJDOE will collect and report information on the use of the freed-up funds. Exceptions to Reducing Maintenance of Effort As per the Guidance issued by the U.S. Department of Education (USDOE) in April 2009 (see www.ed.gov/policy) there are exceptions that exclude some LEAs from using the reduction of maintenance of effort provision.

• Under IDEA section 616 (f), if a State determines that an LEA is not meeting the requirements of Part B, including meeting targets in the state’s performance plan, the SEA must prohibit that LEA from reducing its MOE under LEA section 613(a)(2)(C) for any fiscal year. An LEA

must receive a determination under section 616 of “Meets Requirements” from the state in order to take advantage of this flexibility.

Therefore, districts that received a determination of Needs Assistance or Needs Intervention will not be able to take advantage of any of the flexibility for local MOE reduction. Please refer to the correspondence issued earlier this year by the New Jersey Department of Education, Office of Special Education Programs regarding its annual determination of your school district’s implementation of federal and state special education requirements.