June 11, 2013
TO THE ADMINISTRATOR ADDRESSED:
SUBJECT: Change in federal cost principles and
federal regulations applicable to all open-enrollment charter schools
On May 13, 2013, the Texas Education Agency (TEA) received clarifying
guidance from the US Department of Education (USDE) regarding the federal
cost principles applicable to open-enrollment charter schools.
In that guidance, USDE clarified that to the extent that an
open-enrollment charter school operated by a nonprofit organization (NPO) or an
institution of higher education (IHE) was receiving funds as a local
educational agency (LEA), those open-enrollment charter schools were to be
governed by the same cost principles and federal regulations applicable to other
LEAs, rather than the cost principles and federal regulations applicable to
NPOs and IHEs. Since Texas state law considers all charter schools to be LEAs,
the federal cost principles for LEAs apply.
Open-enrollment charter schools operated by an NPO or IHE
will be required to make the changes described in this letter beginning in the
2013–2014 school year and extending into future school years. TEA will be
updating grant reference material and supporting documents on an ongoing basis
to reflect USDE’s clarifying guidance.
Applicable Cost Principles
Beginning in the 2013–2014 school year, and extending into
future school years, the cost principles applicable to all LEAs, including all open-enrollment
charter schools, will be OMB CircularA-87: Cost Principles for State, Local and Indian Tribal Governments (Title 2 of
the Code of Federal Regulations [2
CFR] Part 225).
Applicable Part of Title 34 of the Code of Federal Regulations (34 CFR)
Also beginning in the 2013–2014 school year, and extending
into future school years, the federal regulations applicable to all LEAs, including all open-enrollment charter schools, will be 34
CFR Part 80.
For Grants Spanning Multiple School Years
For grants that span multiple school years, such as Texas
Title I Priority Schools, Cycle 2, for school years 2011–2012, 2012–2013, and
2013–2014, OMB Circular A-87: Cost Principles for State, Local, and Indian Tribal Governments
CFR Part 225) and 34
CFR Part 80 will become applicable beginning in the 2013–2014 school year.
For Further Information
In the near future, TEA’s Division of Federal Fiscal
Monitoring will post a more detailed letter on the TEA Correspondence page
directed to open-enrollment charter schools detailing how this change affects
open-enrollment charter schools operated by an NPO or IHE.
With any questions, please call the Division of Grants
Administration at (512) 463-8525 or email firstname.lastname@example.org.
Cory Green, Chief Grants Administrator
Division of Grants Administration