Finding 1088739 (2024-001)

U.S. Department of Education direct to District: 2024-001 Special Tests and Provisions – Required Level of Expenditure Name of Federal Program (Assistance Listing Number): Impact Aid (84.041) Criteria: For each fiscal year, the amount of expenditures for special education and related services provided to federally connected children with disabilities must be a least equal to the amount of funds received or credited under Section 7003(d) of the ESEA for that fiscal year. This is demonstrated by comparing the amount of Section 7003(d) funds received or credited with the result of the following calculation: a. Divide total LEA expenditures for special education and related services for all children with disabilities by the average daily attendance (ADA) of all children with disabilities served during the year. b. Multiply the amount determined in paragraph a, above by the ADA of the federally connected children with disabilities claimed by the LEA for thE year. If the amount of Section 7003(d) funds received or credited is greater than the amount calculated above, an overpayment equal to the excess Section 7003(d) funds exits. This overpayment may be reduced or eliminated to the extent that the LEA can demonstrate that the average per pupil expenditure for special education and related services provided to federally connected children with disabilities exceeded its average per pupil expenditure for serving non-federally connected children with disabilities (Section 7003(d) of ESEA (20 USC 7703(d)); 34 CFR section 222.53(d)). Context and Condition: We noted the District’s expenditures for this program have not been fully spent for each fiscal year and the District has a carryforward of unspent Impact Aid funds. Cause: The District did not have processes or controls established to ensure that all Impact Aid funds received were expended in each year of receipt. Effect: A potential failure to not spend the full grant money received. Questioned Costs: No costs were questioned. Recommendation: We recommend management of the District review processes related to required level of expenditures for Impact Aid and establish appropriate internal controls to ensure all requirements are met. Views of responsible officials: Management of the District plans to review the processes and internal controls related to Impact Aid to ensure all requirements are adhered to when applicable.