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U.S. Department of Education: Promoting Educational Excellence for all Americans

Reallocation of LEA Funds (Sec. 300.705(c))

Comment: One commenter supported proposed Sec. 300.705(c). Another commenter requested clarification as to the types of activities that could be supported with the Part B funds that an LEA does not need to provide FAPE, if a State chooses to retain the funds, instead of reallocating the funds to other LEAs in the State. One commenter recommended that the State be authorized to reallocate the funds intended to be allocated to an LEA or retain them for State-level activities only after consulting with the LEA to assess the LEA's needs and after determining that the LEA does not need the funds.

Discussion: A State, under Sec. 300.705(c), may use funds from an LEA that does not need the funds for any allowable activities permitted under Sec. 300.704, to the extent that the State has not reserved the maximum amount of funds it is permitted to reserve for State-level activities pursuant to Sec. 300.704(a) and (b). To the extent the State has not reserved the maximum amount for administration, the State may use those funds for administrative costs consistent with Sec. 300.704(a). To the extent the State has not reserved the maximum amount of funds available for other State-level activities, the State may use those funds for any allowable activities permitted under Sec. 300.704(b)(3) and (4) including, but not limited to, technical assistance, personnel preparation, and assisting LEAs in providing positive behavioral interventions and supports. Additionally, if the State has opted to finance a high-cost fund under Sec. 300.704(c) and has not reserved the maximum amount available for the fund, the State may use those funds for the LEA high-cost fund consistent with Sec. 300.704(c).

In response to the commenter that recommended that the State be permitted to reallocate funds only after consulting with the LEA to assess the LEA's needs, nothing in these regulations prohibits a State from working with an LEA to assess the needs of the LEA before determining that the LEA will not be able to use the funds prior to the end of the carryover period. However, we believe it would be burdensome and unnecessary to require that an SEA consult with an LEA to assess the LEA's needs prior to a reallocation of the LEA's remaining unobligated funds. The LEA would have already had sufficient time and incentive during the carryover period of availability to assess its own needs and make appropriate obligations for needed expenditures.

Changes: None.