States sue DeVos, ED over CARES Act proportional share calculation

Federal interpretation of the CARES Act, contend the attorneys general of Michigan, California, Maine, New Mexico, Wisconson and District of Columbia, will hurt low-income and at-risk students and their teachers, as well as the public schools that serve them and need to meet students' educational and social-emotional needs.
By: | July 14, 2020
Credit: Photo by Alex Wong/Getty ImagesCredit: Photo by Alex Wong/Getty Images

The attorneys general of Michigan, California, Maine, New Mexico, Wisconsin and District of Columbia filed a lawsuit against U.S. Education Secretary Betsy DeVos and the U.S. Education Department for “unlawfully and erroneously interpreting the Coronavirus Aid, Relief, and Economic Security Act, Public Law 116-136, 134 Stat. 281.” State of Michigan, et al. v. DeVos, No. 3:20-cv-04478 (N.D. Calif., filed 07/07/20).

According to the lawsuit, ED’s interpretation of the proportional share calculation in the guidance “Providing Equitable Services to Students and Teachers in Non-Public Schools Under the CARES Act Programs,” 120 LRP 13990 (EDU 04/30/20), is wrong and “will deprive low-income and at-risk students, their teachers, and the public schools that serve them of critical resources to meet students’ educational and social-emotional needs during and after pandemic-related school closures.”

Question 10 of the guidance regarding the proportional share of funds for private school students says that under the CARES Act, services are available for all public and nonpublic students without regard to poverty, low achievement or residence in a participating Title I public school attendance area. Therefore, local educational agencies determine the proportional share by using enrollment data in nonpublic schools under the CARES Act programs compared to enrollment in public schools in the LEA.

Because an LEA determines the proportional share based on total enrollment in public and nonpublic schools under the CARES Act programs, the LEA doesn’t need to collect poverty data from nonpublic schools. An LEA must use the total allocation it receives under each CARES Act program to determine the proportional share available for equitable services before reserving funds for other purposes.

The lawsuit states that requiring LEAs to consider all private-school students when they apportion funds, similar to the calculation used to determine funds for equitable services under Section 8501 of the Elementary and Secondary Education Act, as amended by the Every Student Succeeds Act, Pub. L. No. 114-95, was not adopted by Congress for the CARES Act funds. 34 CFR Part 76.665(c)(1)(ii)

The recent interim final rule officially published in the Federal Register to outline how LEAs must calculate the CARES Act funds was also a topic the lawsuit addressed. The lawsuit points out that although published as an interim final rule, which is effective upon publication, ED issued such rule “without demonstrating good cause that the notice and public procedures were impracticable, unnecessary, or contrary to the public interest.”

Under the interim final rule, an LEA using the CARES Act funds must calculate the funds for equitable services based on students enrolled in private schools in the district. However, if an LEA chooses to use CARES Act funding only for students in its Title I schools, it has two options:

1. Calculate the funds for equitable services based on the total number of low-income students in Title I and participating private schools; or

2. Calculate the funds using the LEA’s Title I, Part A share from the 2019-20 school year.

If an LEA uses one of the low-income student options, the LEA must not violate the Title I supplement, not supplant requirement in Section 1118(b)(2) of the ESEA. That is, LEAs cannot divert state or local funds from their Title I schools because they receive CARES Act funds.

In a press call to address the CARES Act implementation, DeVos noted that there was a bit of confusion and debate about how K-12 CARES Act funds should be allocated and spent on students and teachers in private schools.

“There is nothing in the law Congress passed that would allow districts to discriminate against children and teachers based on private school attendance and employment. In this new rule, we recognized that CARES Act programs are not Title I programs,” she said.

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