Feds Pass Legal Tweak to Special Ed Funding Rules

A tweak to state spending mandates under the Individuals with Disabilities Education Act has passed Congress as part of the spending bill for the remainder of this year earlier this month. Under the new rule changes, states will not be able to tap federal funds for special education when they lower their education spending below the level of the previous year without special dispensation from the U.S. Department of Education.

Education Week reports that although this is typically not an issue, it came to the fore in the last several years after a round of spending cuts initiated by the states in the wake of the 2008 economic collapse. As an example, EdWeek's Alyson Klein offers South Carolina, which sued the DOE after the agency withheld $36 million in funds last fall. The withholding would have been made permanent without the recently passed change.

The Obama administration and lawmakers on Capitol Hill, including U.S. Sen. Tom Harkin, D-Iowa, the chairman of the panel that oversees education spending, added a provision to the recent spending legislation clarifying that while states that are out of compliance with the law will still see their funding reduced, that cut won't be in place in permanently.

Instead, the reduction would just be for the year (or years) that the state was out of compliance and didn't get a waiver. Once the problem had been fixed, the state could go back to its regular spending levels.

The money withheld from a specific state will still be allocated to IDEA-qualified special education programs elsewhere. It wouldn't constitute a permanent spending increase but will be handled as a one-off funding bonus for the compliant states.

The change is expected to impact not only South Carolina but also Kansas, New Mexico and New Jersey – the latter two are awaiting waivers from the DOE that would release their funds even though they're out of compliance.

Needless to say, the change made Mick Zais, the state chief in South Carolina, very happy. In fact, he issued a press release thanking his congressional delegation for their help.

"Congress, led by the South Carolina federal delegation, has heard my plea for common sense regarding the federal government's penalty imposed on South Carolina's children," he said. "Today's action repeals the absurd perpetual penalty that withheld $36,202,909 in funds used to provide services to students with disabilities. This is a victory for students with disabilities in South Carolina and across the nation."

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