Budget Deal Brings Increase to IDEA

H.R. 3547 – the Consolidated Appropriations Act, 2014, was signed into law by the President on January 17, 2014. It provides $1.012 trillion in discretionary spending and funds the government through September 30, 2014.

The Act provides $11.473 billion in federal funds for IDEA Part B Grants to States – a $498 million increase (+4.5%) over the FY 2013 post-sequestration level.

Included in the Act is language that specifies that the level of effort (spending on special education) an LEA must meet “in the year after it fails to maintain its fiscal effort is the level that it should have met in the prior year. This language clarifies congressional intent and is consistent with the Office of Special Education Program’s April 4, 2012 informal guidance letter on this issue”

The April 4, 2012 informal guidance referenced here is the Letter to Boundy in which the U.S. Dept. of Education withdrew an earlier interpretation on the issue articulated in Letter to East.

This action was the result of enormous advocacy efforts by hundreds of advocates around the country coupled with expert legal analysis by the Center for Law and Education’s Co-Director Kathleen B. Boundy. Thanks again to all those who worked on this issue with us back in 2012.

Proposed federal regulations released in September 2013 include the level of effort interpretation laid out in Letter to Boundy as well as other clarifications regarding maintenance of effort requirements for local educational agencies. Final regulations should be released this spring. Meanwhile, the language included in the budget deal bill serves as a reminder of the expectation regarding local effort in order to receive federal IDEA funding.

On a less positive note, the increase in IDEA Part B funds for 2014 will trigger the IDEA provision allowing LEAs to take a reduction in local spending in years when federal funds increase over the previous year. Known as the “50% rule,” it allows LEAs in good standing (i.e., a “Meets Requirements” rating from its State Educational Agency) to reduce local spending on special education by up to half of the increase in federal funds over the previous year. And, even if the increased federal funding is not maintained in subsequent years, LEAs may remain at this reduced level of effort.

The 2014 increase still leaves IDEA Part B federal funding well below IDEA’s commitment to provide 40% of the excess cost of special education – a level often called “full funding.”

The chart below, prepared by the Committee for Education Funding, provides a brief history of IDEA Part B funding.

History of IDEA State Grants

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