Feds clarify annual special education spending rule

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IDEA Maintenance of Effort Rules Finalized

The Department of Education finalized rules April 28 that seek to clarify the responsibility of states to provide spending for special education services in line with the Individuals with Disabilities Education Act.

Under the IDEA’s “maintenance of effort rule,” states are prohibited from reducing their funding levels for special education services from the prior fiscal year, absent a waiver from the federal government. If states violate this rule, they run the risk of receiving reduced matching funds from the federal government, which normally provides about 20 percent of national special education spending.

The Obama Administration approved multiple waivers during the economic recession. In the subsequent years, multiple states argued the IDEA only required that they restore funding to that of the previous, reduced, year.

The Department of Education initially signaled that it approved of this argument, prompting a backlash from special education advocates. The DOE backtracked in April 2012, stating that it believes that IDEA requires states to restore funding to the higher level prior to receiving the waiver.

The DOE proposed new regulations in April 2013, formally adopting this interpretation, which are now finalized.

Although the IDEA is silent as to the level of funding states must meet to comply with the rule, the DOE argues that its clarification is in line with the purpose of the “maintenance of effort” rule, namely to “ensure a continuation of at least a certain level of non-Federal expenditures for the education of children with disabilities.”

“Allowing (state and local governments) to permanently reduce spending for the education of children with disabilities by failing to comply with the IDEA in a preceding fiscal year is inconsistent with the purpose of the (maintenance of effort) requirement, which is to ensure a continuation of at least a certain level of non-Federal expenditures for the education of children with disabilities, and would provide a long-term financial incentive for noncompliance,” the rule states.

The rule goes into effect July 1, 2015.