Jackson County District School Board

Finding District records did not demonstrate compliance with the Special Education Cluster MOE requirement for the 2020-21 fiscal year. Criteria Title 34, Sections 300.203 and 300.204, Code of Federal Regulations, provide that the amount of State and local funds or the combined State and local funds expended by the District on Special Education-related services during any fiscal year must be at least the same, either in total or per capita, as the amount spent in the most recent fiscal year. Allowances for decreases in MOE may be made for certain reasons including the departure of Special Education personnel, a decrease in the enrollment of children with disabilities, the termination of costly expenditures for long-term purchases, such as expenditures for the acquisition of equipment and the construction of school facilities, and the termination of Report No. 2022-XXX March 2022 Page 79 District services for particular students who required costly programs and services but are no longer in the District. Condition The District had not established procedures to adequately monitor and document compliance with the MOE requirement. As part of our audit, we examined District records and determined that the amount of State and local funds spent toward Special Education services, both in aggregate and on a per-student basis, decreased in the 2020-21 fiscal year when compared to the 2019-20 fiscal year. According to District records, the enrollment of children with disabilities decreased in the 2020-21 fiscal year by approximately 3.5 percent and we considered this decrease within our MOE calculations. However, although we requested, District records were not provided to identify other qualified allowances that would justify the decrease in the required effort. Consequently, there was a $208,763 MOE deficiency in State and local expenditures for the 2020-21 fiscal year, resulting in questioned costs of that amount. District personnel agreed with our questioned cost calculations. Cause According to District personnel, the primary methodology for ensuring that the Special Ed ? MOE compliance requirement is maintained is through annual staffing allocations. Due to a decline in enrollment following COVID-19 shutdowns toward the end of the 2019-20 fiscal year, the District made changes to the initial staffing plan by reducing certain non-core curriculum positions. The District also attempted to avoid terminating existing personnel to the extent possible, and Education Stabilization Funds were subsequently utilized to fund existing positions. However, in doing so, the District inadvertently did not consider the impact these actions would have on meeting the MOE requirement. Effect Without adequate procedures to monitor and document efforts to meet the MOE requirement, there is an increased risk that State and local funds will not be properly allocated and expended for Special Education services, and the grantor may reduce future Special Education awards. Recommendation The District should strengthen controls over State and local resources allocated and expended for the SEC to ensure compliance with the Federal MOE requirement. In addition, the District should document to the grantor (FDOE) how the District complied with the Federal MOE requirement or restore $208,763 to the SEC programs. District Response The District shall enhance its procedures to ensure compliance with the Special Ed - Maintenance of Effort requirement.