Maintenance of Effort, Excess Cost, and Supplement Not Supplant

Maintenance of effort, excess cost, and supplement not supplant are related requirements, but they are not interchangeable. An LEA may satisfy one requirement and still fail another. Each calculation should be completed and documented separately.

• IDEA Section 613(a)(1) and (a)(2)

• 34 CFR §§300.16 and 300.202 through 300.205

• 34 CFR Part 300, Appendices A and E

• OSEP, Questions and Answers Regarding LEA Maintenance of Effort

LEA maintenance of effort, commonly called MOE, requires the LEA to budget and spend an appropriate level of state and local funds for the education of children with disabilities.

1. 1. Eligibility standard: The LEA must budget sufficient state and local funds before receiving an IDEA award.

   2. Compliance standard: The LEA must actually spend the required amount during the fiscal year.

• • • Local funds only, total amount

    • Local funds only, per-capita amount

    • State and local funds, total amount

    • State and local funds, per-capita amount

If an LEA fails MOE, the next year’s required level does not automatically decrease to the lower amount actually spent. The subsequent-years rule generally preserves the amount the LEA should have spent.

• • • Voluntary departure or retirement of special education personnel

    • A decrease in the enrollment of children with disabilities

    • Termination of an exceptionally costly program for a particular child

    • Completion of a costly long-term purchase

An LEA should not apply an exception or adjustment without reviewing the circumstances with its fiscal office and ALSDE.

The excess-cost requirement ensures that IDEA funds are used only after the LEA provides the basic state and local financial support available to all students.

The LEA calculates an average annual per-pupil expenditure and determines the minimum amount of state and local funding that must be spent for students with disabilities before IDEA funds are used. Elementary and secondary calculations are generally completed separately.

Meeting MOE does not automatically demonstrate compliance with excess cost. The calculations measure different requirements.

IDEA funds must supplement state and local funds and may not improperly replace them. For IDEA Part B, compliance with supplement not supplant is primarily demonstrated through compliance with the LEA MOE requirements.

Do not apply the Title I supplement-not-supplant methodology to IDEA. The federal programs use different compliance tests.

• Treating MOE and excess cost as the same calculation

• Using the prior year’s lower actual expenditure after an MOE failure

• Applying an MOE exception without documentation

• Calculating excess cost without separating elementary and secondary expenditures

• Using IDEA funds to replace recurring state or local obligations without an allowable exception or adjustment

• Taking an MOE reduction while subject to mandatory Comprehensive CEIS