OSEP Retracks Previous Guidance on MOE Fiscal Effort

OLD July 2011
OSEP guidance in the past has been that LEAs noncompliant with MOE could pay back an amount equal to the amount of noncompliance. Then, the new MOE threshold would be the prior year’s level of expenditures. Basically the MOE threshold would be lowered when funds were paid back. Some LEAs chose to reduce special education funding or “take the hit” and “reset” their MOE threshold lower.

NEW April 2012
Recent OSEP guidance REVERSES this interpretation and states that LEAs may not reduce their MOE requirements by simply sending less local, or local and state, funds. The level the LEA must meet in the year after noncompliance is the level of effort that it should have met in the prior year and not the LEA’s actual expenditures. Reducing fiscal effort is only allowed when the LEA meets the allowable exceptions.

TEA is reviewing the implications of this change on the 2009-10 Letters of Findings of Noncompliance currently under review as well as the 2010-11 letters expected in May. We will provide more information as it is available from TEA, possibly in June.

Previous Guidance: Letter to East July 2011, 57IDELR108 (OSEP 2011)

Current Guidance: Letter to Boundy April 2012, 112 LRP 16608 (OSERS/OSEP 04/04/12)

MOE contacts: Linda McDaniel at linda.mcdaniel@esc13.txed.net  and Shirley Sanford at shirley.sanford@esc13.txed.net


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