FY 13 Special Education & Other Funding Issues

IASBO Annual ConferenceMay 17, 2012

Illinois State Board of Education Funding and Disbursement Services

Tim Imler, Division Administrator

Division Phone: 217/782-5256

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Presentation Outline• FY 12 State Backlog Report

• FY 13 State Special Education Funding

• FY 13 Federal Special Education Funding

• Federal Sequestration

• FY 13 Federal Year End Expenditure Report Changes

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FY 12 State Backlog ReportComptroller Report – General Revenue Fund

May 14

• Current ISBE Backlog - $559 Million• Current State Backlog - $3.5 Billion• Oldest Voucher Date – March 5, 2012• September & December MCAT released• March & June MCAT pending

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FY 13 State Special Education

What is a Mandated Categorical Program?In general, a mandated categorical program and the funds appropriated for it are earmarked and mandated by statute for a particular purpose or population and may be used for that purpose or population only.

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FY 13 State Special Education

FY 13 ISBE Board Request Sp Ed MCAT (-$6.7M) Sp Ed Personnel (-$25.5M) Funding for Children Requiring Sp Ed

Services (-$29.2M) Sp Ed Private Tuition (+36.1M) Sp Ed Summer School (-$1.1M) Sp Ed Orphanage (+9.3M) Sp Ed Transportation (+3.7M)

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FY 13 State Special EducationSp Ed Personnel (-$25.5M)• P.A. 96-257, amended Section 14-1.10 of the

School Code to provide a definition of “qualified worker” and replace “professional worker” for the purpose of reimbursement under Section 14-13.01 of the School Code.

• The standard for reimbursement of staff are defined as those who are necessary to deliver direct and related services to special education students.

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FY 13 State Special EducationSp Ed Personnel (-$25.5M)• Rule changes in Part 226.850 and 226.860 were

added to list the specific positions, and the qualifications for reimbursement.

• Certain certified positions are no longer reimbursable. These staff are often are in reg ed classrooms where sp ed students are placed but instruction is gen ed rather than sp ed (e.g. Art, Home Economics, Industrial Arts)

• Part 226 Rule Changes Effective May 26, 2011

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FY 13 State Special EducationFunding for Children Requiring Sp Ed Services (-$29.2M)

School Year State Count Change2006-2007 326,5392007-2008 322,683 -1.18%2008-2009 318,461 -1.31%2009-2010 312,533 -1.86%2010-2011 302,830 -3.10%2011-12 (EST) 298,742 -1.35%

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FY 13 State Special EducationHouse Resolution 706 - ConcernsElem and Secondary Education Reduction of $258.5M from FY 12

FY 12 Final GRF – $6,750,386,600HR 706 FY 13 GRF - $6,491,836,794

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FY 13 State Special EducationHouse Resolution 706 - Concerns• General State Aid Impact

Flat Approp $4.4B – 91.6% ($5,857 FL) Board Request $4.6B – 96.1% ($6,006 FL)

• Sp Ed Federal MOE Impact – Year to Year Student Per Capita

• Impact to other Programs (e.g. Early Childhood, Bilingual, Regular Transportation etc.)

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FY 13 Federal Special EducationIDEA PART B FUNDS

FY 2012 FY 2013Flow Through $501,248,821 $505,651,259

(+4,402,438)

Preschool $17,337,847 $17,308,047(-$29,800)

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FEDERAL SEQUESTRATION• The Budget Control Act (BCA) of 2011 established

a Joint Select Committee (JSC) on deficit reduction to propose legislation reducing deficits by $2.3 trillion over 10 years. A “sequestration” procedure was approved to increase the incentive on the JSC to reach a compromise.

• Because the JSC failed to achieve its goal, sequestration — a form of automatic cuts at $1.2 trillion largely across the board — is scheduled to occur starting in January 2013.

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FEDERAL SEQUESTRATION• Cuts to grants in Fed FY 13 (i.e. State FY 14) are

estimated at 7.8% or $700 Billion in non-defense cuts.

• October 25, 2011 National Education Association Letter to the JAC included estimates: $3.54 billion cut to Education

$1.1 billion cut to Title I $896 million cut to IDEA and $590 million cut to Head Start

Estimated loss of more than 70,000 jobs

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FY 2012 Year End

Federal Expenditure Reporting Changes

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Review of Major ChangesEffective July 1, 2011 (FY 2012)

• Traditional monthly payment schedules eliminated

• Grant recipients must document immediate cash need to receive Federal funds (i.e. expenditure reports)

• Two funding methods: Reimbursement & Modified Advance

• Cumulative expenditure reports must be submitted on a cash accounting basis (i.e. expenses are recognized when cash is actually paid)

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Review of Major ChangesEffective July 1, 2011 (FY 2012)

• Liabilities/Obligations are not permitted to be reported during the project year

• Weekly ISBE Vouchering Every Wednesday-Business Day

• Payments can be expected within 3-5 business days from voucher date

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Primary Changes• Obligation amount can be entered

• Reports can be filed with through dates AFTER the project end date until all obligations have been paid (should be within 90 days)

• Payments will continue to be made on cumulative cash basis expenditures plus the Commitment Amount but will NOT include obligations reported

• Reporting outstanding obligations ONLY keeps the project active and open, not final

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Obligations• Any liability (e.g. purchase order) recorded

on or before the end of the project and is expected to be paid within 90 days.

• Payroll expenditures must be supported by time and effort or equivalent records for individual employees.

• Payments will be processed towards your actual cash expenditures and will not include the obligated amount.

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ObligationsIf the obligation is for: The obligation is made:a) acquisition of real or personal property.

-on the date on which a written commitment to acquire the property has been made.

b) personal services by an employee.

-when the service has been performed.

c) personal services by a contractor (not an employee).

-on the date on which a binding written commitment to obtain the services has been made.

d) performance of work other than a personal service.

-on the date on which a binding written commitment to obtain the work has been made.

e) public utility service. -when the service is received.f) travel. -when the travel is taken.g) rental of real or personal property. -when the property is used.

h) a pre-agreement cost that was properly approved by the State.

-when the pre-agreement costs were approved by the State.

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Completion vs. Final ReportsCompletion Report: • All approved project activities are complete

by the project end date

• Expenditure report is equal to or greater than the project end date

• Obligation amount entered (90 days) Commitment Amount allowed (30 days) Commitment Amount cannot be entered without

an Obligation amount reported Commitment Amount cannot be > than obligation

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Completion vs. Final ReportsFinal Report:• All approved project activities are complete

by the project end date

• Expenditure report is equal to or greater than the project end date

• NO obligations reported Commitment Amount Not Available Final payment calculated Carryover, if applicable, will be

determined

Completion/Final Expenditure ReportFY12 Federal Project

Project End Date: 06-30-2012Budget: 10,000

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Through June 30

ThroughJuly 31

Through August 31

ThroughSeptember 30

Cash BasisExpenditures 7,000 8,000 8,000 10,000

OutstandingObligations 3,000 2,000 2,000 0

CommitmentAmount 1,000 0 2,000 0

Total Disbursed 8,000 8,000 10,000

Final10,000

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Reminders• Obligations AND project activities cannot

occur until a “substantially approvable” application has been received at ISBE

• Expenditure reports (requests for payment) cannot be submitted prior to an APPROVED application on file at ISBE

• Regardless of when the application is approved, the begin date will determine the required quarterly reports that must be submitted

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Questions Phone: (217) 782-5256