The Individuals with Disabilities Education Act (PL 108-446) requires that the South Carolina Department of Education monitor local education agencies on a regular basis to ensure fiscal compliance with state and federal laws, rules, and regulations that govern the provision of special education and related services to appropriately identified children. The purpose of this monitoring is to focus federal, state, and local resources on improved results for children with disabilities and their families.
The goal of the OSES’s Fiscal Monitoring is to ensure that LEAs are meeting the requirements of federal, state and IDEA regulations. The OSES’s fiscal monitoring approach is outcome oriented. However, if noncompliance is identified through any of the OSES’s monitoring activities, the OSES will require the LEA to correct the noncompliance as soon as possible, but in no case later than one year after the identification of the noncompliance.
Contrary to the notion that monitoring is an annual on-site process, the OSES employs several monitoring activities to ensure compliance with federal and local regulations and improve educational results and functional outcomes for students with disabilities. Monitoring activities include grants accounting processing system (GAPS) reviews, MOE calculator review, on-site fiscal monitoring, desk audits, LEA self-assessments, grant applications, and audit findings reviews.
The OSES has an established risk based tiered fiscal monitoring protocol. The fiscal monitoring process includes three tiers with increasing scrutiny of processes and documentation through the tier progression. A risk assessment rubric has been established to make determinations as to progression from Tier 1 to Tier 2 and from Tier 2 to Tier 3. Scores will be assigned for all monitoring components. Data is collected during the early fall for Tier 1; and Tier 2 monitoring begins in the late fall. The Tier 3 monitoring process begins in January.
Tier 1 monitoring will be conducted annually as a self-assessment to all LEAs. LEA Self-Assessments: The LEA self-assessment is a process by which LEAs assess their own performance and progress toward compliance with IDEA Part B. The self-assessment is designed to guide LEAs though a collaborative analysis and planning process to engage stakeholders in developing targeted improvement activities in the areas that the LEA is most in need. The self-assessment tool may be based on the compliance monitoring tool used by the OSES for on-site monitoring visits; thus LEAs can prepare for future on-site monitoring as well as clearly identify areas of noncompliance in student files and LEA policies and procedures.
After the self-assessment is completed by the LEAs, the information is gathered and entered into the Risk Assessment Rubric. This rubric consists of rating key fiscal submissions and information such as a self-assessment; district single audit management decisions, timely and accurate submission of data; submission of MOE compliance documents; timely submission of expenditures; and percentage of sub-grant budgeted for salaries. All submissions are filed electronically on an office shared drive in readily identifiable folders and various checklists have been developed to track the timeliness of submissions of the self-assessment questionnaire, MOE compliance calculator and IDEA application and budget.
In addition, sub-recipient budgets and expenditures are monitored through the GAPS system and reports are readily available to track award balances. The OSES Fiscal and Grants Management (FGM) team tracks expenditures and balances in the (GAPs) to ensure that balances do not remain at the end of the grant period.
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Tier 2 monitoring will apply to up to 15 LEAs per year (dependent upon analysis of risk assessment criteria) and will involve a more detailed review of policies, procedures, financial ledgers, and timeliness and accuracy of data submissions. Fiscal Monitors work with districts during the desk audit to ensure that district policies and procedures are in compliance with Uniform Grant Guidance, IDEA, and state regulations. Some Policies and Procedures reviewed include time and effort, inventory, allowable expenditures, etc. Areas of focus are determined by interactions with districts, professional development seminars attended by FGM and 2CFR 200.331. Desk audits will be completed by December. The results of the desk audits are placed into a rubric to determine which districts move to Tier 3
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Tier 3 monitoring will apply to up to 10 LEAs (dependent upon analysis of risk assessment criteria) and will involve an on-site or virtual, review of policies and procedures, financial ledgers, and timeliness and accuracy of data submissions. An inventory of IDEA purchased equipment will also be performed at a selected district site. Upon completion of the on-site (virtual) monitoring, an official Letter of Findings will be issued to the LEA for any deficiencies noted with a specific timeline established for correction. Tier 3 monitoring will be completed by May of each year.
In the event of unexpected and/or extraordinary circumstances, Tier 3 Fiscal Monitoring will be performed virtually using the same procedures and protocols as the onsite-monitoring process with the exception of the Inventory Review. Fiscal Monitors will work the LEA to schedule a time to perform a virtual inventory where districts will provide images of tagged inventory items.
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Excess costs are those costs that are in excess of the average annual per-student expenditure in an LEA during the preceding school year for an elementary school or secondary school student, as may be appropriate, and that must be computed after deducting:
Excess Cost calculators are reviewed annually to ensure compliance with IDEA regulations. If LEAs are chosen for on-site/virtual monitoring, they will be required to provide documentation to support the Excess Cost calculation for review by FGM Monitors.
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For a local educational agency (LEA) to be eligible to receive Individuals with Disabilities Education Act, Part B (IDEA Part B) grant funds, the LEA must meet the federal fiscal accountability requirement known as maintenance of effort (MOE), defined under Title 34 of the Code of Federal Regulations (34 CFR) 300.203.
There are two MOE standards. The required MOE level for budgeting is referred to as the “eligibility standard” and the required MOE level for expenditures is referred to as the “compliance standard”.
Annually the FGM Monitors review Maintenance of Effort (MOE) calculators for all LEAs to ensure compliance with federal regulations.
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