Fiscal Issues Related to Operating a Schoolwide Program

 

The key decisions and overall fiscal accountability related to Title I, Part A schoolwide programs are in the hands of the local educational agency (LEA). The decision to consolidate funds and to select a specific consolidation option is made by your campus in consultation with your LEA. Your LEA is responsible for ensuring that all campuses maintain appropriate accounting structures and documentation and that they comply with other fiscal requirements.

This page provides information about fiscal issues that apply to your campus's schoolwide program, including examples of possible accounting structures and details about the carryover of unspent funds and important fiscal requirements that your campus and LEA must meet.

Consolidation of Funds

To take full advantage of the flexibility offered by the schoolwide program model, your campus can consolidate its federal, state, and local funds. The purpose of consolidating funds is to help a schoolwide campus upgrade its entire educational program based upon the needs identified in its comprehensive needs assessment. By consolidating funds, a schoolwide campus can address its needs using all of the resources available to it. This gives a campus more flexibility in terms of how it uses available resources to meet the identified needs of its students.

Consolidating federal funds in a schoolwide program also has the following advantages:

  • Consolidating federal funds eases the requirements for accounting for funds from each specific program separately, because a schoolwide campus is not required to distinguish between funds received from different sources when accounting for their use. Therefore, a campus is not required to maintain separate fiscal accounting records, by federal program, that identify the specific activities supported by each program's funds in order to demonstrate that those activities are allowable under the program.
  • A schoolwide campus that consolidates federal funds is not required to meet most of the statutory and regulatory requirements of the specific federal programs included in the consolidation. However, the campus must ensure that it meets the intents and purposes of the federal programs included in the consolidation so that it meets the needs of the intended beneficiaries. 

There are three possible consolidation options:

  1. Full consolidation. This option involves pooling some or all of your campus's federal funds with state and local funds, and provides the most flexibility in terms of operating programs.
  2. Federal consolidation. This option involves pooling some or all of your campus's federal funds, but does not involve state or local funds.
  3. Title I, Part A. This option does not pool any funds, but allows your campus to use its Title I, Part A allocation on a schoolwide basis.

TEA has created a detailed chart to help you decide which consolidation option would be best for your campus. The chart contains specific requirements under each option. 

Adequate Documentation

A schoolwide campus is not required to meet most statutory or regulatory requirements of the consolidated programs. It is also not required to maintain separate fiscal accounting records, by program, that identify the specific activities supported by those particular consolidated program funds. However, your campus must still do the following:

  1. Demonstrate that its schoolwide program contains sufficient resources and activities to reasonably address the intent and purpose of included programs, particularly as they relate to the lowest-performing students.
  2. Maintain records that demonstrate that the schoolwide program as a whole addresses the intents and purposes of each of the federal education programs whose funds were consolidated to support it.
  3. Identify in its schoolwide plan the programs that have been consolidated and address how it intends to meet the intents and purposes of those programs.
  4. Demonstrate that it received at least the same amount of state and local funds that, in the aggregate, it would have received in the absence of the schoolwide program.

Appropriate Accounting Structure

Each LEA is responsible for ensuring that campuses operating schoolwide programs have appropriate accounting systems in place. These accounting systems must be able to accommodate the flexibility of fund consolidation, yet also maintain accurate records regarding the percentages and amounts allocated from each program.

Consolidating funds into one "pool" does not mean that a campus must put all of its funds into one account with its own accounting code, although that is an option. Instead, the pool concept means that a campus can use the consolidated funds for one purpose, which is to operate the schoolwide program, without regard to the programmatic identity of those funds.

In accounting for expenditures from consolidated funds, your LEA has a number of options. While each option uses slightly different processes, the common element in all three options is that consolidated funds are not tracked to specific activities allowable under a particular program.

Please note that any federal funds not included in a consolidated schoolwide pool must be tracked and accounted for separately. 

Although programs consolidated in a schoolwide setting lose their programmatic identity and LEAs are not required to track expenditures by specific program, state accounting guidelines require that an LEA be able to identify expenditures for the entire consolidated schoolwide pool by functional categories, such as salaries, travel, and supplies. However, an LEA is not required to track how much it spends on each category back to an allowable activity in specific program included in the consolidated schoolwide pool. All consolidated funds and services must support the campus's campus improvement plan.

Regardless of the accounting structure that your campus selects, you must still code all of your expenditures with the appropriate program intent code (PIC) based upon the source of funds. More information about PIC codes (PDF, 3.84 MB) is available in Module 1 of the TEA Financial Accountability System Resource Guide.

The following options are possible ways to set up an appropriate accounting structure. Please note that they do not demonstrate a specific type of consolidation.

Option 1: Distribution of Expenditure Based on Proportionality of Revenues (LEA–Level Structure)

In this option, the LEA creates a consolidated schoolwide pool, with its own locally defined accounting code, for all of the campuses operating a schoolwide program. The program funds distributed to a schoolwide campus that are included in the consolidation lose their programmatic identity and may be used for any activity consistent with the campus's campus improvement plan.

As shown in the table below, for each of its Title I, Part A campuses operating a schoolwide program, the LEA determines how much (percentage) each program in each campus contributes to the consolidated schoolwide pool. As each of its schoolwide campuses spends money for activities to support its schoolwide plan, the LEA draws down funds and charges them to each program based on the proportionate shares. For example, because Title I, Part A contributed 8 percent of the funds to the consolidated schoolwide pool, the LEA would know that 8 percent of the expenditures made from the consolidated schoolwide pool for all its schoolwide campuses should be attributed to Title I, Part A.

Option 1: LEA–Level Structure
 Programs Contributing Funds to the Consolidated Schoolwide Pool

Campus

Title I, Part A—Disadvantaged

Title II—Improving Teacher Quality

Perkins Career and Technical Education

Title III—English Language Acquisition

State and Local Funds

Total for Each Building

A

$182,535

$25,000

$10,685

$94,462

$2,048,115

$2,360,797

B

115,455

25,000

20,071

27,709

1,380,884

1,569,119

C

181,780

25,000

23,686

69,272

1,940,161

2,239,899

D

141,900

110,437

22,351

93,202

1,999,902

2,367,792

E

229,460

110,437

27,546

61,715

1,936,291

2,365,449

F

169,860

110,437

23,796

54,158

1,525,307

1,883,558

Total Funds LEA Distributes to Individual Schools

1,020,990

406,311

128,135

400,518

10,830,660

12,786,614

Percent of Total

8%

3%

1%

3%

85%

11%

 

If you plan to use this option, you can budget your schoolwide funds in the budget summary of the applicable TEA federal grant application using class-object code 8911, Operating Transfer Out. See the schedule instructions for your program budget summary for more information.

More guidance about this option (Word, 995 KB, outside source) is available from the US Department of Education.

Option 2: Distribution of Expenditure Based on Proportionality of Revenues (Campus-Level Structure)

In this option, an LEA establishes a consolidated schoolwide pool from which an individual school campus uses all or a portion of the federal, state, and local funds it receives to support its schoolwide activities consistent with its schoolwide plan. Although the program funds included in the consolidated schoolwide pool lose their programmatic identity and may be used for any activity consistent with the campus's schoolwide plan, the LEA, for accounting purposes, still attributes expenditures of those funds back to a specific program regardless of what services those funds support. The LEA may use any reasonable method to demonstrate that the funds in a schoolwide program have been expended, and in this option, uses a proportional method. This means that the LEA allocates expenditures of federal funds in a schoolwide program in proportion to the funds provided to the campus. For example, if Title I, Part A funds make up 24 percent of the funds combined in a schoolwide program, then the LEA reports 24 percent of the expenditures back to Title I, Part A, without having to track those expenditures to an allowable Title I, Part A activity.

The chart below is an example for a campus that receives $1,000,000 in revenues from the programs shown:

Option 2: Distribution of Expenditure Based on Revenues (Campus Level)

Source of Funds

Revenues

Percent of Total

Expenditures

Total

$1,000,000

100.0%

$950,000

State and Local Funds (included in schoolwide program)

520,000

52.0%

494,000

Federal Programs (included in schoolwide program)

 

Title I, Part A

240,000

24.0%

228,000

Title II—Improving Teacher Quality

40,000

4.0%

38,000

Title III, Part A—English Language Acquisition

120,000

12.0%

114,000

Carl D. Perkins Career and Technical Education

80,000

8.0%

76,000

 

If you plan to use this option, you can budget your schoolwide funds in the budget summary of the applicable TEA federal grant application using class-object code 8911, Operating Transfer Out. See the schedule instructions for your program budget summary for more information.

More guidance about this option (Word, 995 KB, outside source) is available from the US Department of Education. 

Option 3: Sequence Charging of Schoolwide Expenditures (Campus-Level Structure)

This option is similar to Option 2 except that the LEA charges 100 percent of all schoolwide expenditures in a campus first to state and local sources and then to Title I, Part A and other federal programs until these funds are spent in their entirety or until the maximum carryover amount is all that remains unexpended.

The chart below shows the same figures used in Option 2 to show sequence charging.

Option 3: Sequence Charging of Schoolwide Expenditures (Campus Level)

Source of Funds

Revenues

Total Expenditures ($950,000) Charged to Federal, State, and Local Programs

Amount Remaining

Total Included in Schoolwide Consolidated Pool

$1,000,000

 

 

State and Local Sources

520,000

$520,000

 

Federal Sources

 

Title I, Part A

240,000

240,000

 

Title II, Part A—Improving Teacher Quality

40,000

40,000

 

Title III, Part A—English Language Acquisition

120,000

120,000

 

Carl D. Perkins Career and Technical Education

80,000

30,000

$50,000

 

If you plan to use this option, you can budget your schoolwide funds in the budget summary of the applicable TEA federal grant application using class-object code 8911, Operating Transfer Out. See the schedule instructions for your program budget summary for more information. 

More guidance about this option (Word, 995 KB, outside source) is available from the US Department of Education.

More information about appropriate accounting structure and consolidation of funds is available online in the Federal Register.

Carryover of Funds

Funds that are consolidated into a schoolwide pool and remain unspent at the end of the grant period may be carried over to the subsequent grant year, but you must meet all programmatic carryover requirements. Certain grants do not allow carryover, and certain grants also limit the amount that can be carried over. For example, only 15 percent of the amount of Title I, Part A funds allocated to a campus can be carried over. Unless you apply for and are granted a Title I, Part A statutory carryover waiver or a TEA Ed-Flex waiver, this limit should be incorporated into your campus's accounting structure to avoid lapsing of funds.

Campuses that operate schoolwide programs must calculate the actual amount of funds that can be carried over from each fund source. This calculation is based upon the type of accounting structure selected by the campus. If your campus is allocating expenditures back to each fund source using the proportionality of revenues option, the carryover amount for each program is based upon the same proportionate percentage contributed to the schoolwide budget. For example, if Grant A contributed 20 percent of its funds to the schoolwide budget, then 20 percent of the unspent funds that are left in the schoolwide budget after all expenditures have been paid should remain in Grant A as carryover (if allowable and only up to the established limit, if applicable).

If your campus selected sequence charging of schoolwide expenditures and drew down expenditures first from state and local sources and then from federal grant programs, you can determine the amount of carryover for each federal program by using one of two methods. The first method is for your campus to estimate the carryover amount for applicable federal grants at the beginning of the grant period. You can do this by reviewing spending data from previous years and estimating the percentage of the schoolwide budget that will likely be spent. Throughout the grant period, your campus draws down funds from each federal fund source up to that estimated percentage, leaving the remainder unspent. Thus the same percentage is spent from each federal fund source, and the same percentage of unspent funds can be carried over (if allowable and only up to the established limit, if applicable). For example, if your campus estimates that it will likely spend 80 percent of its schoolwide budget, it draws down funds from each federal fund source until 20 percent of each fund source remains unspent. The 20 percent remains in each grant as carryover.

If your campus spends more than its estimated percentage, it must then use the second method to determine the amount of carryover for each program. This method requires you to calculate the percentage of your total schoolwide budget left unspent at the end of the grant period (usually left in only one or two federal program accounts). You then apply this percentage to the amount actually contributed to the schoolwide budget by each fund source. This calculation results in the amount that you should apportion to each program as the carryover amount. For example, if your campus calculates that 3 percent of the total budget was left unspent, you calculate 3 percent of the amount contributed by Grant A and apportion it as the carryover amount for Grant A, then calculate 3 percent of the amount contributed by Grant B, and so on.

Campuses that use the second method must adjust their general ledgers to transfer the appropriate amount of expenditures from one fund source to another so that each program is left with the correct carryover amount. This process will likely require a campus to generate and submit refunds and reimbursement requests to TEA.

Other Requirements

LEAs with campuses that consolidate federal funds in a schoolwide program must still comply with certain federal fiscal requirements as described below:

  • Comparability of services. The LEA must ensure that it gives campuses that receive Title I, Part A funds the same level of services through state and local funds as campuses that do not receive Title I, Part A funding. More information about comparability of services is available online from TEA.
  • Distribution of formula funds to campuses. LEAs that have both schoolwide and nonschoolwide campuses must distribute all formula funds according to the authorizing statute. The presence of schoolwide campuses does not give the LEA authority to redistribute formula funds among its campuses.
  • Maintenance of Effort (MOE). This requirement applies to LEAs that receive federal funds under the Elementary and Secondary Education Act of 1965 (ESEA). Schoolwide programs must comply with this requirement. More information about MOE is available online.
  • Set-asides. Campuses that receive Title I, Part A funds are required to spend 10 percent of their Title I, Part A funds on professional development (if TEA has identified the campus or its LEA as being in need of improvement [priority and focus schools]) and one percent on parental involvement activities (if the entitlement of the campus's LEA exceeds $500,000). Campuses consolidating funds in a schoolwide program must still comply with this requirement, but can use a simple method to demonstrate their compliance. Each campus must
    • Show that it spent an amount equal to 10 percent of its Title I, Part A allocation on professional development. This amount does not actually have to be taken from Title I, Part A funds.
    • Show that its parental involvement activities consumed, at a minimum, an amount equal to the amount of Title I, Part A parental involvement funds the school received from its local educational agency. The campus does not actually need to provide these activities with Title I, Part A funds, but must meet all the programmatic requirements specified in the law, not simply the "intents and purposes" of parental involvement activities. 
  • Supplement, not supplant. This requirement usually means that federal funds cannot be used to perform a service that would normally be paid for with state or local funds. In a schoolwide program, however, the campus only needs to demonstrate that the Title I, Part A funding given to the campus is supplemental to what the school would have received in the absence of Title I, Part A, without considering whether Title I, Part A funding was used to buy an additional service or benefit. In other words, the campus operating a schoolwide program is not required to demonstrate that any particular service is supplementary to the services regularly provided on that campus to all students.
    The LEA is responsible for ensuring that the campus receives all of the state and local funding it would otherwise receive if it did not receive Title I, Part A funds. If the LEA cannot demonstrate that the campus receives enough nonfederal funding to cover basis costs, then Title I, Part A funds will not be considered supplemental.
    LEAs must be prepared to demonstrate that they distribute state and local funds to their campuses fairly and equitably.
  • Time and effort. Employee documentation of time and effort is greatly simplified in a schoolwide program. The amount of flexibility available depends upon the extent to which the campus consolidates it funds. For example, employees paid entirely from a schoolwide pool are not required to keep signed semi-annual certifications or any form of time and effort records. More information about time and effort in schoolwide programs is available online from TEA. Your campus may also be able to take advantage of the flexibility offered by the substitute time and effort system. More information about the substitute time and effort system is available online from TEA.  

Additional Guidance from TEA

Additional guidance about Title I, Part A schoolwide programs is available at the following web pages:

Schoolwide Programs
This is the home page for Title I, Part A schoolwide programs, and provides general information about choosing to implement a schoolwide program, eligibility, and basic requirements.

General Information about Schoolwide Programs
This page describes the general purpose, goals, and fundamental principles of Title I, Part A schoolwide programs.

Schoolwide Programs: Comprehensive Needs Assessment
This page provides detailed information about the required comprehensive needs assessment, including recommended steps to follow.

Schoolwide Programs: Campus Improvement Plan
This page provides detailed information about the required campus improvement plan, including the required accounting and program components.

Schoolwide Programs: Annual Evaluation Plan
This page provides detailed information about the required annual evaluation plan, including recommended steps to follow.

Choosing a Consolidation Option for Schoolwide Programs
This page contains a chart showing the differences between the three ways you can consolidate funds in schoolwide programs.

     Additional Guidance from USDE

    This page summarizes the information and requirements given by the US Department of Education. The source documents are available at the links below:

    Section 1114 of the Elementary and Secondary Education Act (ESEA)

    Designing Schoolwide Programs, Non-Regulatory Guidance, March 2006 (Word, 425 KB, outside source)

    Title I Fiscal Issues, Non-Regulatory Guidance, February, 2008 (Word, 995 KB, outside source)

    Federal Register, July 2, 2004 (Volume 69, Number 127)

    Letter from Raymond Simon, Assistant Secretary for Elementary and Secondary Education, US Department of Education, to Leigh Manasevit, Esq. (July 30, 2004) (PDF, 81 KB, outside source)

     Contact Information 

    For more information about Title I, Part A schoolwide programs, please contact Anita Villarreal in the Division of Federal and State Education Policy at nclb@tea.state.tx.us.


    For more information about the TEA federal flexibility initiative, please contact Terry Reyes in the Office for Grants and Federal Fiscal Compliance at terry.reyes@tea.state.tx.us.

    Page last modified on 10/16/2014 04:37:53 PM.