How are districts affected by cancellation of IFR to calculate CARES Act funding?

School systems in states that followed the interim final rule on equitable services for private schools are in a tricky spot if they already allocated funds to these schools.
By: | October 12, 2020
Getty Images: Jonathan KirnGetty Images: Jonathan Kirn

Now that the interim final rule (IFR) on equitable services for private schools is no longer in affect and the U.S. Education Department has stated that it will not appeal the U.S. District Court rulings, states that decided to follow the IFR will need to make financial adjustments to fit the ESSA Title I funding formula.

According to Noelle Ellerson Ng, associate executive director of advocacy and governance with the School Superintendents Association, school districts that didn’t allocate resources to private schools are now in a position to allocate those resources as they were intended by the CARES Act. The scenario that is problematic, she said, is if the school district is located in any state that moved forward in good faith with the IFR and the higher amount of resources is already in the hands of private schools.

“You know how the scenario is when public schools are underfunded,” Ng says. “The real rub here lies in how those public and private schools will be able to go back to the table to right the wrong. Will the private schools act in good faith to return resources that were misallocated and now we have the correction?”

For example, Ohio used the IFR as the basis for the state’s guidance to districts regarding the calculation of equitable services under the CARES Act ESSER funds during the period when the IFR was valid. To adjust the calculation according to Title I funding formula, the state provided districts with updated calculation tools to recalculate the equitable service amount following the rules of ESSA Section 1117.

“Districts have been instructed to use the data that is reported in the Nonpublic Data System, additional data collected through ongoing consultation, and the public district low income data located in their Consolidated Application in our e-grant system,” says Mandy Minick, deputy director of communications and press secretary with the Ohio Department of Education. “Once this is completed, a revision can be made by the district to its ESSER application in our e-grants system.”

Minick said Ohio doesn’t anticipate that adjusting to the updated calculations will be a lengthy process since the state released guidance on September 25 with the new calculation tool, and there is a training scheduled for early October. However, Minick points out that the way such calculation adjustments may affect allocations to serve private school children will depend on individual districts’ circumstances in how they used ESSER funds during the IFR.

“We know that in Ohio, many districts chose to use the total enrollment approach under the IFR to calculate and provide equitable services,” Minick says. “With the change to the rules of Section 1117, fewer nonpublic schools will be eligible to receive ESSER services. It is also a possibility that nonpublic schools will receive fewer ESSER services with the low-income proportion instead of the total enrollment proportion.”

The IFR has not been in effect since National Association for the Advancement of Colored People v. DeVos, 120 LRP 26741 (D.D.C. 09/04/20), when Judge Dabney Friedrich of the U.S. District Court, District of Columbia ruled that ED exceeded its authority releasing the IFR.

Originally, ED had published the IFR to outline how local educational agencies were supposed to calculate the CARES Act funds. However, it was followed by two other major court decisions that were not in favor of the IFR and ruled for ED to cease its enforcement of the IFR: State of Michigan v. DeVos, 120 LRP 25403 (N.D. Cal. 08/26/20); and State of Washington v. DeVos, 120 LRP 24841 (W.D. Wash. 08/21/20).

Claude Bornel covers ELs and other Title I issues for TitleIAdmin, a DA sister publication. Links to documents mentioned above are available to subscribers.