High Cost Fund Preamble and State Plan
Texas Education Agency
Division of Federal and State Education Policy
The purpose of the High Cost Fund is to assist local education agencies (LEAs*) in addressing the needs of "high need children with disabilities" by lessening the financial impact associated with providing direct special education and related services to high need children with disabilities.
*For these purposes, throughout the Preamble and State Plan, the term “local education agency (LEA)” includes a consortium of school districts or a charter school that is an LEA.
During the 82nd Texas Legislative Session (2011), the Legislature appropriated funds for the Local Educational Agency Risk Pool, (Rider 36). Out of the funds appropriated for Students with Disabilities, (Strategy A.2.3 House Bill 1, General Appropriations Act, Article III), the Commissioner shall implement the provisions of the Individuals with Disabilities Education Act (IDEA) of 2004, pertaining to a local educational agency risk pool. The Commissioner shall allocate allowable amounts under the Act for the 2012 fiscal year and the 2013 fiscal year to establish the high cost fund to assist districts with high need students with disabilities. It is the intent of the Legislature that the use of these funds by school districts and charter schools does not violate the least restrictive environment requirements of IDEA 2004, relating to placement and state funding systems that distribute funds based on type of setting.
The State will reserve for fiscal years 2012 and 2013 ten percent of the amount of funds the State reserves for other State-level activities under 34 CFR §300.704 (b)(1). These funds will not be used for costs associated with establishing, supporting, and otherwise administering the High Cost Fund. These funds remain under the control of the State until disbursed to an LEA to support a specific child who qualifies under the State plan for the High Cost Fund. The impact of the High Cost Fund on student services and placement may be monitored by the TEA.
Definition of a High Need Child with a Disability:
A high need child with a disability financially impacts the budget of the LEA due to the high costs associated with providing direct special education and related services to the high need child with disabilities.
The cost of a high need child with a disability is greater than four times the average per pupil expenditure in the State (as defined in section 9101 of the ESEA).
Program Effective Dates
The High Cost Fund award period for the 2012-2013 school year is October 1, 2012 through August 31, 2013.
Use of Funds:
- The costs associated with educating a high need child with a disability are only those costs associated with providing direct special education and related services to the child that are identified in that child’s IEP, including the cost of room and board for a residential placement determined necessary, consistent with the least restrictive environment requirements of IDEA 2004 (34 CFR 300.114), to implement a child’s IEP.
- LEAs, if eligible, already receive discretionary residential funds to assist with the costs for students with disabilities who are served in residential care and treatment facilities. Therefore, disbursements from the High Cost Fund for the cost of residential care and treatment will be limited to a portion of the LEAs’ 25% residential set aside amount being used for the specific high need student.
- These costs must be incurred during the High Cost Fund program effective dates.
- The High Cost Fund must not be used to limit or condition the right of a child with a disability who is assisted under Part B of the Act to receive a free appropriate public education (FAPE) in the least restrictive environment (LRE) pursuant to section 612(a)(5) of the Act.
- The High Cost Fund must not be used to support legal fees, court costs, or other costs associated with a cause of action brought on behalf of a child with a disability to ensure FAPE for such child.
- The High Cost Fund must not be used to pay costs that otherwise would be reimbursed as medical assistance for a child with a disability under the State Medicaid program under Title XIX of the Social Security Act.
LEA Eligibility Criteria:
The LEA may request a High Cost Fund award provided that the LEA:
- Has not violated the least restrictive environment requirements of IDEA of 2004;
- Has not lapsed IDEA-B Formula or Formula Deaf funds from the previous school year;
- Does not roll forward 50% or more of its IDEA-B formula funds from the previous year; and
- Has complied with all systems of accountability and reporting to the Texas Education Agency, including but not limited to: accountability ratings, performance-based monitoring, compliance, fiscal reports, and dispute resolution processes.
Funding Mechanism for Distribution of the High Cost Fund:
The single member LEA or the fiscal agent of an SSA must complete a High Cost Fund Eligibility Application which consists of a student-specific application for each specific high need child with a disability who meets the definition of a high need child in the State plan.
The completed HCF Eligibility Application must be submitted to the TEA Division of IDEA Coordination by the submittal method and deadline specified by the TEA.
The HCF Eligibility Application will be reviewed to determine if eligibility criteria have been met.
The High Cost Fund award may not be fully funded. The LEA award amounts will be calculated based on the total amount being requested statewide and the amount of funds available.
After receiving approval from the TEA Chief Deputy Commissioner, an award letter will be generated and mailed to the Superintendent of the single member LEA or the fiscal agent of an SSA. A copy will also be sent to the LEA’s Director of Special Education and to the Special Education Contact at the Education Service Center (ESC).
If an application does not meet the eligibility criteria, a denial letter will be mailed to the Superintendent of the single member LEA or the fiscal agent of an SSA. A copy will also be sent to the LEA’s Director of Special Education and to the Special Education Contact at the ESC.
Once the award letter is received, the LEA MUST budget for the High Cost funds via TEA’s eGrants Standard Application System (SAS) using the IDEA-B High Cost Grant application (SPED AH12). Failure to budget these funds will result in loss of funds.
A Notice of Grant Award (NOGA) will be issued after completion of TEA's program and fiscal reviews of the eGrants IDEA-B High Cost Grant application.
LEAs must draw down reimbursements on the HCF NOGA using the Expenditure Reporting (ER) system. The ER system is accessed through the TEASE system at: TEASE Logon
As with other grants and programs, LEAs must create and maintain adequate and sufficient documentation demonstrating that expenditures pertained to the High Cost Fund. This may be accomplished by maintaining routine records (e.g., purchase orders, invoices, payroll records, etc.) and by utilizing a locally defined subobject code or other local option code to track expenditures. Alternatively, the LEA may indicate on all documentation (purchase orders, contracts, etc) that the transaction will be reimbursed out of the High Cost Funds. The LEA must also maintain sufficient documentation to demonstrate that expenditures pertained to the specific high need child for whom the HCF award was granted.
The deadline to submit the HCF Eligibility Application (to request an award) is 11:59 pm Monday, October 1, 2012.
The deadline to submit the eGrants IDEA-B High Cost Grant Application (SPED AH13) (to budget the funds) is 5pm July 15, 2013.
Both applications can be accessed at: TEASE Logon
Technical Assistance Contact information:
(512) 463-9414 | High Cost Funding Team or email firstname.lastname@example.org
TEA SE Support or e-mail email@example.com
ESC Special Education Contact at your regional education service center
(512) 463-7025 | eGrants Help Desk or e-mail firstname.lastname@example.org
Division of Federal and State Education Policy
1701 North Congress Avenue | Austin, Texas 78701-1494
Telephone: 512.463.9414 | Fax: 512.463.9560