Proposed ED Guidance Aims to Lessen “Burdensome” Supplement Not Supplant Requirements

The U.S. Department of Education (ED) recently released proposed non-regulatory guidance addressing school district compliance with the requirement that federal funds “supplement, and do not supplant” state and local funds under Title I, Part A of the Elementary and Secondary Education Act (ESEA) as amended by the Every Student Succeeds Act (ESSA). Under the proposed guidance, a school district would be required only to use a “Title I neutral” methodology to allot funds to schools, meaning that it must allocate State and local funds to schools without regard for Title I status. School districts would be free to develop their own methodology for allotting funds, although the guidance suggests two systems that districts can use. The proposal will provide additional flexibility to school districts in complying with the requirements for Title I, Part A funds. School districts and other stakeholders may submit comments to ED in support or opposition to the proposed guidance.

ED allocates Title I, Part A funds to school districts and other local educational agencies (LEAs) through State educational agencies (SEAs) like the Illinois State Board of Education (ISBE). The purpose of Title I, Part A funds is to improve the achievement of low-achieving students in schools with high concentrations of students from low-income families. Title I, Part A includes a requirement that school districts use Title I funds to supplement, not supplant, funds from State and local sources for the education of students participating in Title I, Part A programs. Amendments to the ESEA by ESSA suggested that Congress intended more flexibility at the state and local levels for compliance with the supplement, not supplant, requirements. Under the Obama administration, however, proposed rules would have required schools to spend roughly equal amounts of State and local funds per pupil in Title I and non-Title I schools. In other words, if a school had no Title I program, the district would have funded each school equally. Critics, including ISBE, claimed that this was an overreach, and the guidance was not passed. 

The proposed guidance recognizes that most LEAs have a methodology (or methodologies) to allocate State and local funds to schools. To demonstrate compliance with the supplement does not supplant requirement under the guidance, an LEA’s methodology must result in each Title I school in the LEA receiving all the State and local funds it would otherwise receive if it were not receiving Title I, Part A funds. In other words, the methodology may not take into account a school’s Title I status.

The proposed guidance provides two examples of methodologies that a LEAs may—but are not required to—use: (1) allocation of state and local funds based on student characteristics (weighted student funding), under which an LEA allocates State and local funds to schools based on a standard formula allocating dollar amounts based on objective student characteristics (e.g., low-income, English learner, student with a disability); and (2) allocation of state and local funds based on staffing and supplies, under which an LEA allocates state and local funds to schools based on average costs for staffing and supplies (e.g., principals, librarians, teachers, and materials/supplies). The guidance states that as long as a school uses one of these methodologies to allocate State and local funds to each school, without regard to whether the school receives Title I, Part A funds, it will comply with the supplement not supplant requirements. Other methodologies may also meet the standards, as well.

According to the press release, ED issued on the proposed guidance, “[w]hile important and well-intentioned, the supplement does not supplant requirement has become restrictive and burdensome—to the point that some school districts made ineffective spending choices in an effort to avoid noncompliance.” According to ED Secretary Betsy DeVos, although the proposed guidance does not change the legal requirements, it is aimed at letting schools spend money on what they deem best for students without concern that it might raise red flags in an audit.

Stakeholders have 30 days to comment and provide feedback on the draft non-regulatory guidance document.