2022-23 Pupil Accounting Manual

As reported in last month’s School Law Notes, the Michigan Department of Education (MDE) recently published the 2022-23 Pupil Accounting Manual (PAM) and a “Notable Changes” document flagging PAM changes.

Changes reflected in the 2022-23 PAM incorporate recent legislation and notify schools of MDE’s interpretation of legal requirements. Significant PAM changes are outlined below.

Virtual Learning

Virtual learning programs are subject to the strenuous requirements in State School Aid Act (SSAA) Sections 6 and 21f, and PAM Section 5-O-D. Specific requirements include parental consent for virtual course enrollment (unless the student is at least 18 or an emancipated minor), virtual course publication in a course catalog, and student participation methods such as two-way interactions between each student and the teacher of record (or mentor).

Effective July 14, 2022, the Legislature removed a particularly onerous requirement of pupil accounting, which required an educational development plan for each pupil enrolled in more than two virtual courses. The PAM now reflects removal of that requirement and incorporates the SSAA clarification that a school can offer virtual courses directly or through a third-party vendor.

Each student enrolled in a virtual course must be assigned a teacher of record. A new PAM Q&A states that a teacher employed by a third-party vendor could satisfy the teacher of record requirement, but the enrolling school must ensure that the teacher is certified and is included in a Master Teacher List. Another new PAM Q&A recites the same concept for a school that enters into a cooperative education agreement with another school for the provision of virtual programs. In such a situation, a teacher employed by the school providing the program can satisfy the teacher of record requirement, but the enrolling school must ensure that the teacher is certified and included in the Master Teacher List.

PAM Section 5-O-D added an extra requirement for counting virtual students in membership – the majority of a virtual course’s curriculum must be delivered using the internet or through a digital learning environment.

Teacher Endorsements

For a student to be counted in membership, SSAA Section 6(8) requires that the student be in “attendance and receiving instruction in all classes for which the [student is] enrolled on the pupil membership count day or the supplemental count day.” MDE has long taken the position that if a student is not instructed by a certified teacher (or a teacher otherwise approved by MDE), the instruction received from that teacher is not a “class” and does not count for membership.

In 2020, the Legislature amended SSAA Section 6(8) to add a requirement that the teacher providing instruction must also be “appropriately placed.” In the 2021-22 PAM, MDE interpreted “appropriately placed” to mean that the teacher must be teaching within the grade-level and subject area reflected on the teacher’s certificate or other MDE approval. A violation of this requirement potentially leads to two state aid penalties for the employing school. One penalty is assessed under SSAA Section 163 equal to 50% of the teacher’s salary during the non-compliance period. If the non-compliance occurred on count day, an additional penalty under SSAA Section 6 is assessed equal to the basic foundation allowance attributable to the number of full-time equivalent students taught by that teacher on count day.

SSAA Section 6 was again amended to delay the “appropriately placed” requirement until the 2023-24 school year, and PAM Section 3 was amended to reflect that delay. MDE’s Notable Changes document, however, states that, for the 2022-23 school year, “auditors will review placements at the grade-level” and, starting in 2023-24, “auditors will review placements for both grade and subject area.”

School officials should ensure now that teachers are certified and teaching within the grade-level and subject-matter listed on their teaching certifications. Even before SSAA Section 6 was amended to add the “appropriately placed” requirement, MDE issued both SSAA Section 6 and Section 163 state aid penalties for teachers teaching outside of the grade level and subject matter listed on their teaching certificates.

Residency Verification

PAM Section 3 states that a school may require reasonable verification to establish that a student resides within the school’s geographic boundaries, e.g., proof of rent payment, utility bill, driver’s license. The Michigan Address Confidentiality Program Act, effective December 29, 2020, allows victims of domestic violence, human trafficking, sexual assault, and stalking to receive a “designated address,” permitting their actual physical address to remain confidential.

PAM Section 3 was updated to state that a student participating in the Address Confidentiality Program will be provided with a program participation card and a letter from the State of Michigan which will serve as documentation of residency. The PAM notes that a school cannot require such a participant to provide the school with a physical address for residency verification purposes. Instead, the school can use the “designated address” listed in the State of Michigan letter as the student’s mailing address.

Conclusion

We recommend that school officials carefully review the PAM’s new requirements and clarifications to ensure PAM compliance. Failure to comply with PAM requirements can result in significant state aid deductions.