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Special Education Listserv

Subject: IMPORTANT/JUNE 15/Changes to Reporting Maintenance of Effort


Source: Shelley Witherbee, Director, Funds Management

Intended Audience: Special Education Directors, Finance Administrators

Date: May 18, 2009

In past years, districts have been able to apply applicable exceptions and adjustments to their BUDGETED Maintenance of Effort (MOE) amount for the upcoming year. Starting with the 2008-09 (FY09) Part B FER, this will change. According to IDEA regulations, the district must budget for the next school year (2009-10) an amount of local/state funds equal to or greater than the prior year MOE for purposes of establishing the district's eligibility to receive Part B funds.

If a district applies projected expenditure savings based on allowable exceptions and adjustments to the budgeted MOE, the new year (2009-10) budget would reflect an MOE less than the prior year actual MOE expenditure and the district would therefore be ineligible for receipt of Part B funds.  Allowable exceptions and the adjustment to MOE will be applied to the ACTUAL MOE expenditures when the final expenditure report is filed at the end of the 2009-10 school year.

This will require districts to track local/state expenditures related to the FY 2010 MOE internally throughout the 2009-10 school year making budget adjustments throughout the school year as actual expenditure patterns become more evident.  

What makes this MOE discussion somewhat confusing is that at the beginning of the 2009-10 school year, the district must budget an MOE amount in the ePeGS System that does not take into account the potential allowable exceptions. Thus the budgeted MOE amount appears to be higher than what the actual expenditures may turn out to be. When the district submits its 2009-10 Part B FER in June 2010, the new (and lower) MOE level will become evident as the district enters its 2009-10 expenditures and allowable exceptions/adjustment amounts into the FER.

The lower adjusted MOE level will be reflected at that time AND the Part B budget for the next year (2010-11) will indicate the lower MOE level for that following school year.

The key phrase to remember is budgeted amount. Even though the district may be budgeting a higher amount for MOE at the beginning of the 2009-10 school year than it plans to expend (due to likely reductions/ adjustment taken at the end of the school year), the district does not have to expend that budgeted amount but rather should focus on the level of expenditure necessary to provide special education services to eligible students.

The MOE worksheet will be built into the Part B FER as a supporting data document. Therefore, districts are no longer required to fill out the MOE excel spreadsheet.

The Part B FER training guide will be posted when the FER is available.

Please contact the Funds Management Section at (573) 751-0622 with questions.