POLICY LETTER: January 6, 2011 to Washington Office of Superintendent of Public Instruction Special Education Section Director Douglas Gill

January 6, 2011Dr. Douglas GillSpecial Education SectionWashington Office of Superintendent of Public InstructionP.O. Box 47200Olympia, Washington 98504-7200Dear Dr. Gill:I am writing in response to an electronic mail (email) message you sent on September 21, 2009, regarding maintenance of effort (MOE) reductions in light of the American Recovery and Reinvestment Act of 2009 (ARRA). I apologize for the delay in responding. Specifically, you asked: Is the maximum amount a district can reduce their expenditures in prior year no more than 50% of the increase, OR can a district reduce by 50% and then apply the exceptions, etc. so that a district could in fact, reduce their expenditures by MORE than 50% of the increase in a given year? Statement of the IssueAs you are aware, States received a large increase in fiscal year (FY) 2009 Individuals with Disabilities Education Act (IDEA) Part B funds under the ARRA. This increase in special education funding under ARRA represents an unprecedented opportunity to improve outcomes for students with disabilities, and to advance systemic reforms that will have a lasting impact. Because of this increase, most local educational agencies (LEAs) received approximately twice the amount of IDEA, section 611 funds in FY 2009 than they received in FY 2008. The Departme(c) The termination of the obligation of the agency, consistent with this part, to provide a program of special education to a particular child with a disability that is an exceptionally costly program, as determined by the SEA, because the child(1) Has left the jurisdiction of the agency; (2) Has reached the age at which the obligation of the agency to provide FAPE [free appropriate public education] to the child has termination; or (3) No longer needs the program of special education. (d) The termination of costly expenditures for long-term purchases, such as the acquisition of equipment or the construction of school facilities. (e) The assumption of cost by the high cost fund operated by the SEA [State educational agency] under 300.704(c).Under 34 CFR 300.205(a), [n]otwithstanding 300.202(a)(2) and (b) and 300.203(a), and except as provided in paragraph (d) of this section and 300.230(e)(2), for any fiscal year for which the allocation received by an LEA under 300.705 exceeds the amount the LEA received for the previous fiscal year, the LEA may reduce the level of expenditures otherwise required by 300.203(a) by not more than 50 percent of the amount of that excess. Analysis and ConclusionWe do not interpret 34 CFR 300.205(a) as restricting the MOE reductions that may be made becae PAGE * MERGEFORMAT 2 Dr. Douglas Gill