The CARES Act, a federal economic stimulus package enacted in response to COVID-19, allocated $30.75 billion in emergency relief funds for schools. On April 29, 2020, the U.S. Department of Education (USDOE) approved MDE’s application for the Elementary and Secondary School Emergency Relief Fund (ESSER), one of several funds available to educational institutions under the CARES Act. As a requirement of receiving ESSER funds, a local educational agency (LEA) must provide equitable services to students and teachers in non-public schools “in the same manner as provided under section 1117 of the ESEA [Elementary and Secondary Education Act] of 1965.”
Under ESEA Section 1117 (commonly referred to as Title I, Part A), the provision of equitable services and the allocation of funds to private schools has been based on poverty rates, i.e., the number of children from low-income families residing in the LEA who attend private schools.
On April 30, 2020, the USDOE released non-binding guidance entitled Providing Equitable Services to Students and Teachers in Non-Public Schools Under the CARES Act Program, which instead directs LEAs to provide equitable services to private schools located within their jurisdiction based on the total enrollment in the private school, without regard to poverty rates, residency, or income level. The guidance is available at:
USDOE’s guidance is contrary to the CARES Act’s plain language and is inconsistent with Title I’s long-standing objective of providing additional financial assistance to schools with a high percentage of children from low-income families to help ensure that all children meet challenging state academic standards.
In response to the USDOE guidance, on May 28, 2020, State Superintendent Dr. Michael Rice released a memorandum to school superintendents and noted the conflict between the CARES Act and USDOE’s guidance:
According to the plain reading of the CARES Act, the formula for distribution of ESSER funds within each LEA is the same as that for Title I Part A funds on an annual basis. In other words, the distribution of equitable services should remain unchanged and should continue to be based on the number of eligible low-income students in non-public schools relative to the number of eligible low-income students in the LEA.
Dr. Rice’s memorandum is available at:
Dr. Rice recommended that schools hold in reserve the difference between what they typically distribute under the Title I, Part A formula and the amount they would distribute under USDOE’s guidance. Dr. Rice’s recommendation appears to be based on Secretary DeVos’ May 22, 2020 response to a letter from the Executive Director of the Council of Chief State School Officers (CCSSO), an organization of which Dr. Rice is a member. CCSSO advocated for USDOE guidance consistent with Title I. Secretary DeVos reasoned that since the CARES Act is a “special, pandemic-related appropriation to benefit all American students,” she maintained her stance on the provision of equitable services. Secretary DeVos also wrote:
Please let your members know that, consistent with the law, they should be ensuring that local educational agencies (LEAs) are holding meaningful consultation with non-public school representatives. If they or their district superintendents insist on acting contrary to the Department’s stated position, they should, at minimum, put into an escrow account the difference between the amount generated by the proportional-student enrollment formula and the Title I, Part A formula. That way, non-public school students and teachers can begin to receive at least some of the equitable services to which they are entitled.
Secretary DeVos indicated that the USDOE intends to initiate rulemaking on this issue in the coming weeks, which will allow for public comment. Given the controversy surrounding USDOE’s guidance, litigation seems likely. Thrun Law Firm will continue to monitor this evolving situation.
In the meantime, schools should consider adopting the escrow/reserve approach recommended by Secretary DeVos in her response to the CCSSO letter until a final rule is issued or the courts decide this issue. Of course, school officials must still initiate the CARES Act-mandated, good faith consultation process with the appropriate non-public school officials before an LEA makes its equitable services decision as required by the CARES Act. This process includes notifying non-public school officials of the opportunity to receive equitable services under the CARES Act and consulting with them during the design and development of the LEA’s programs before making any decision that affects the non-public school’s opportunity to participate. If you have questions about the equitable service guidance, please call your Thrun Law Firm attorney.