FINDING 2023-003
Subject: COVID-19 - Education Stabilization Fund - Special Tests and
Provisions - Participation of Private School Children
Federal Agency: Department of Education
Federal Program: COVID-19 - Education Stabilization Fund
Assistance Listings Number: 84.425C
Federal Award Number and Year (or Other Identifying Number): S425C200018
Pass-Through Entity: Indiana Department of Education
Compliance Requirement: Special Tests and Provisions - Participation of Private School Children
Audit Findings: Material Weakness, Other Matters
INDIANA STATE BOARD OF ACCOUNTS
22
METROPOLITAN SCHOOL DISTRICT OF SOUTHWEST ALLEN COUNTY
SCHEDULE OF FINDINGS AND QUESTIONED COSTS
(Continued)
Condition and Context
In March 2020, Congress passed the Coronavirus Aid, Relief, and Economic Security (CARES)
Act, which included the Education Stabilization Fund (ESF). One of the ESF programs included in the
CARES Act was the Governor's Emergency Education Relief (GEER I) Fund. For programs under the
GEER I, a local educational agency (LEA) that receives funds must provide equitable services in the same
manner as provided under section 1117 of Title I, Part A of the Education and Secondary Education Act
(ESEA) to students and teachers in private schools as determined in consultation with private school
officials. Under the GEER I, the LEA in which a private school is located is responsible for providing
equitable services to students and teachers in the school.
The School Corporation chose to apply for a GEER I grant in partnership with other school
corporations. One of the other school corporations was designated as the lead applicant. Each school
corporation that was a part of the application was required to consult with the private schools within its
boundaries. However, the School Corporation did not consult with the four private schools within its
boundaries, due to a misunderstanding of which school corporation, the lead applicant or each individual
applicant, would complete this requirement. As a result, the nonpublic schools within the School
Corporation's boundaries did not have the opportunity to participate in the GEER I award.
The lack of internal controls and noncompliance were isolated to the GEER I program award.
Criteria
2 CFR 200.303 states in part:
"The non-federal entity must:
(a) Establish and maintain effective internal control over the Federal award that provides
reasonable assurance that the non-Federal entity is managing the Federal award in
compliance with Federal statutes, regulations, and the terms and conditions of the Federal
award. These internal controls should be in compliance with guidance in 'Standards for
Internal Control in the Federal Government' issued by the Comptroller General of the
United States or the 'Internal Control Integrated Framework', issued by the Committee of
Sponsoring Organizations of the Treadway Commission (COSO). . . ."
The CARES Act P. CARES Act, Pub. L. No. 116-136 134 Stat. 281 (Mar. 27, 2020) Section
18005(a) states:
"(a) IN GENERAL.—A local educational agency receiving funds under sections 18002 or
18003 of this title shall provide equitable services in the same manner as provided under
section 1117 of the ESEA of 1965 to students and teachers in non-public schools, as
determined in consultation with representatives of non-public schools. . . ."
20 USC 6320(a)(1) states:
"To the extent consistent with the number of eligible children identified under section 6315(c)
of this title in the school district served by a local educational agency who are enrolled in private
elementary schools and secondary schools, a local educational agency shall—
INDIANA STATE BOARD OF ACCOUNTS
23
METROPOLITAN SCHOOL DISTRICT OF SOUTHWEST ALLEN COUNTY
SCHEDULE OF FINDINGS AND QUESTIONED COSTS
(Continued)
(A) after timely and meaningful consultation with appropriate private school officials,
provide such children, on an equitable basis and individually or in combination, as
requested by the officials to best meet the needs of such children, special educational
services, instructional services (including evaluations to determine the progress being
made in meeting such students' academic needs), counseling, mentoring, one-on-one
tutoring, or other benefits under this part (such as dual or concurrent enrollment,
educational radio and television, computer equipment and materials, other technology, and
mobile educational services and equipment) that address their needs; and
(B) ensure that teachers and families of the children participate, on an equitable basis, in
services and activities developed pursuant to section 6318 of this title."
20 USC 6320(c)(1) states:
"A local educational agency shall have the final authority, consistent with this section, to
calculate the number of children, ages 5 through 17, who are from low-income families and
attend private schools by-
(A) using the same measure of low income used to count public school children;
(B) using the results of a survey that, to the extent possible, protects the identity of
families of private school students, and allowing such survey results to be extrapolated if
complete actual data are unavailable;
(C) applying the low-income percentage of each participating public school attendance
area, determined pursuant to this section, to the number of private school children who
reside in that school attendance area; or
(D) using an equated measure of low income correlated with the measure of low income
used to count public school children."
Cause
A proper system of internal controls was not designed by management of the School Corporation.
Embedded within a properly designed and implemented internal control system should be internal controls
consisting of policies and procedures. Policies reflect the School Corporation's management statements
of what should be done to effect internal controls, and procedures should consist of actions that would
implement these policies.
Effect
Without the proper implementation of an effectively designed system of internal controls, the internal
control system cannot be capable of effectively preventing, or detecting and correcting, material noncompliance.
As a result, the nonpublic schools were not consulted with to determine what, if any, equitable
services needed to be provided.
Noncompliance with the provisions of federal statutes, regulations, and the terms and conditions of
the federal award could result in the loss of future federal funding to the School Corporation.
INDIANA STATE BOARD OF ACCOUNTS
24
METROPOLITAN SCHOOL DISTRICT OF SOUTHWEST ALLEN COUNTY
SCHEDULE OF FINDINGS AND QUESTIONED COSTS
(Continued)
Questioned Costs
There were no questioned costs identified.
Recommendation
We recommended that management of the School Corporation establish a proper system of
internal controls and develop policies and procedures to ensure nonpublic schools are consulted with and
equitable services are offered to participating nonpublic schools.
Views of Responsible Officials
For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.