Fiscal Issues Related to Operating a Schoolwide Program

The key fiscal 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 schoolwide campuses maintain appropriate 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 consolidation of funds, accounting methodologies, 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 some or all of your campus's eligible state and local funds, and provides the most flexibility in terms of operating programs. The regulations given in the Education Department General Administrative Regulations (EDGAR) do not apply to the administration of federal grant funds in this consolidation option. Campuses that select this option, however, must still follow all applicable state regulations, including reporting requirements and the rules of accounting given in TEA’s Financial Accountability System Resource Guide (FASRG).
    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 Title I, Part 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 in its schoolwide program campus improvement plan (CIP) that its schoolwide program contains sufficient resources and activities to reasonably address the intents and purposes of programs whose funds are consolidated, particularly as they relate to the lowest-performing students.
      2. Identify in its CIP  the programs that have been consolidated and the amount each program contributes to the schoolwide pool.
      3. 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 Title I, Part A funds.

      Specific examples of additional documents that LEAs must maintain are described on the funding and accounting decisions web page.

        Accounting Methodologies

        LEAs with campuses that operate Title I, Part A schoolwide programs must select and follow an accounting methodology to account for expenditures made from each campus's schoolwide pool of consolidated funds. Guidance from the US Department of Education describes three possible accounting methodologies that LEAs can use to account for schoolwide expenditures. LEAs can also develop and use "any reasonable method" to account for their campus's schoolwide expenditures. TEA strongly recommends the second methodology described below (distribution of expenditure based on proportionality of revenues [campus-level structure]).

        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.

        The three possible accounting methodologies are described below. Please note that they do not demonstrate a specific type of consolidation.

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

        In this methodology, 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.

        Methodology 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%

        100%

         

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

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

        In this methodology, 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 campus improvement 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 consolidated 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:

        Methodology 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

         

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

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

        This methodology is similar to Methodology 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 Methodology 2 to show sequence charging.

        Methodology 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

         

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

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

        More detailed information from TEA about funding and accounting decisions for schoolwide programs is available online.

        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. LEAs with a total Title I, Part A allotment that exceeds $500,000 must set aside at least one percent of their total allotment of Title I, Part A funds for parental involvement activities. LEAs must distribute at least 95 percent of the set-aside funds (95 percent of the 1 percent) to its Title I, Part A campuses. The Title I, Part A campuses are required to use these funds to fulfill the parental involvement requirement described in Section 1118 of the Elementary and Secondary Education Act (ESEA).
          Schoolwide program schools can demonstrate their compliance with this requirement by showing that the expenses related to its parental involvement activities used, at a minimum, an amount equal to the amount of Title I, Part A parental involvement funds the campus received from its local educational agency (presuming that most LEAs divide the reservation equally among all Title I campuses). Because you are consolidating funds, your 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.
          If TEA has identified your LEA as being in need of improvement (priority and focus schools), you are no longer required to set aside and spend 10 percent of your Title I, Part A funds on professional development. This requirement changed because of a waiver granted by USDE. More information about the NCLB flexibility waiver is available online.
        • 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 LEA only needs to demonstrate that the Title I, Part A funding given to each campus is supplemental to what the campus 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. An LEA can demonstrate its compliance with this requirement by passing the supplemental funds test. Details about the supplemental funds test are given on another web page.
        • 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:

        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.

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

        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.

        Schoolwide Programs: Accounting for Expenditures, Part I
        This is the first of three web pages that provide information about accounting for schoolwide program expenditures. This page describes fund code 282.

        Schoolwide Programs: Accounting for Expenditures, Part II
        This is the second of three web pages that provide information about accounting for schoolwide program expenditures. This page provides examples of how to account for an actual schoolwide program expenditure by using fund code 282 in a general ledger.

        Schoolwide Programs: Accounting for Expenditures, Part III
        This is the third of three web pages that provide information about accounting for schoolwide program expenditures. This page provides examples of how to account for an actual schoolwide program expenditure by using fund code 282 in a general ledger.

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

        Schoolwide Programs: Funding and Accounting Decisions, Part I
        This is the first in a series of web pages that provide the basic steps to follow to implement the funding and accounting components of a schoolwide program. This page covers documentation requirements and the supplemental funds test.

        Schoolwide Programs: Funding and Accounting Decisions, Part II
        This is the second in a series of web pages that provide the basic steps to follow to implement the funding and accounting components of a schoolwide program. This page covers allocating funds to a schoolwide program.

        Schoolwide Programs: Funding and Accounting Decisions, Part III
        This is the third in a series of web pages that provide the basic steps to follow to implement the funding and accounting components of a schoolwide program. This page covers following an accounting methodology, proportionality tables, and committing to a schoolwide program on a grant application.

         

          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.texas.gov.

          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.texas.gov.