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University Microfilms International THE DISTRIBUTION OF INTERMEDIATE SCHOOL DISTRICTSPECIAL EDUCATION MILLAGE FUNDS TO CONSTITUENT SCHOOL DISTRICTS IN MICHIGAN By Timothy Lee Krug A DISSERTATION S u bm it te d t o Michigan S t a t e U n i v e r s i t y 1n p a r t i a l f u l f i l l m e n t o f t h e r e q u i r e m e n t s f o r t h e d e g r e e of DOCTOR OF PHILOSOPHY Department of Counseling# E d u c a t i o n a l Psychology# and S p e c i a l E d u c a ti o n 1986 ABSTRACT THE DISTRIBUTION OF INTERMEDIATE SCHOOL DISTRICT SPECIAL EDUCATION MILLAGE FUNDS TO CONSTITUENT SCHOOL DISTRICTS IN MICHIGAN By Timothy Lee Krug Mich iga n R u le s g o v e r n i n g t h e d i s t r i b u t i o n o f s p e c i a l e d u c a t i o n m l l l a g e f u n d s r e q u i r e t h a t I n t e r m e d i a t e sch oo l d i s t r i c t s (ISDs) d i s t r i b u t e t h e s e fun ds In a I 1 k e - p e r c e n t payment t o a l l c o n s t i t u e n t d i s t r i c t s f o r t h e i r unreimbursed a d d itio n a l c o s ts of providing sp ecia l e d u c a t i o n pr og ra m s and s e r v i c e s . The Rule s a l s o a l l o w an ISD t o use an a l t e r n a t i v e d i s t r i b u t i o n method 1f t h e method and r e a s o n s t h e r e f o r a r e s u b m i t t e d f o r s t a t e ap p r o v al 1n t h e r e q u i r e d annual s p e c i a l education plan. The p u rp o s e o f t h i s s t u d y was t o l e a r n t h e manner 1n which s p e c i a l e d u c a t i o n m l l l a g e fu n ds w ere d i s t r i b u t e d . Specifically# 1t sought to discover: 1. I f c o n s t i t u e n t d i s t r i c t s and t h e i r han di ca pp ed c h i l d r e n were t r e a t e d 1n a c c o r d a n c e w i t h a p p l i c a b l e r e g u l a t i o n s f o r f i n a n c i a l support; 2. Whether any r e p o r t e d p r a c t i c e s t h a t d i f f e r e d from t h e d i s t r i b u t i o n methods embodied i n t h e Rules d i m i n i s h e q u i t y ; and 3. What p r o c e s s e s t h e s t a t e used t o e n s u r e co m p li an c e. Timothy Lee Krug The p o p u l a t i o n c o m p r i s e d 55 ISDs. Inform ation concerning the a c t u a l methods used t o d i s t r i b u t e s p e c i a l e d u c a t i o n m l l l a g e fun ds was r e q u e s t e d from each ISD and s p e c i a l e d u c a t i o n p l a n s f o r 1984-85 were r e v ie w e d . A Michigan D e p a r tm e n t o f E d u c a ti o n d e s i g n e e was I n t e r v i e w e d t o d i s c o v e r t h e s t a t e p r o c e s s e s used t o e n s u r e co m p li a n c e . The f i n d i n g s d i s c l o s e d t h e f o l l o w i n g : 1. Only 21% o f t h e ISDs (9 o f 42) r e q u i r e d t o f o l l o w t h e r u l e s so co m pl ied . 2. Four ISDs used e a r m a r k e d s p e c i a l e d u c a t i o n fu nd s t o s u p p o r t t h e g e n e r a l e d u c a t i o n programs o f t h e i r o u t - o f - f o r m u l a d i s t r i c t s . 3. Ten ISDs p r o v i d e d f r e e s e r v i c e t o some c o n s t i t u e n t d i s t r i c t s and p r o r a t e d s u p p o r t f o r t h e same s e r v i c e t o o t h e r s . 4. S i x t y - t h r e e p e r c e n t o f t h e ISDs (33 o f 52) used an a l t e r n a t i v e d i s t r i b u t i o n method; o n ly 17 s u b m i t t e d t h e method i n t h e i r s p e c i a l e d u c a t i o n plans* a s r e q u i r e d * and o n l y two o f t h e s e I n c l u d e d t h e required reasons. 5. Nine ISDs used f l a t - g r a n t d i s t r i b u t i o n s y s t e m s (or v a r i a t i o n s ) * which r e s u l t e d 1n v a r y i n g d e g r e e s o f r e i m b u r s e m e n t I n e q u i t y . 6. T w e n t y - f o u r ISDs used v a r i a t i o n s o f t h e s t a t e - s p e c i f i e d e x c e s s - c o s t d i s t r i b u t i o n system* which r e s u l t e d 1n v a r y i n g d e g r e e s o f r e i m ­ bursement equity. 7. The s t a t e a p p e a r s t o hav e r o u t i n e l y approv ed a l t e r n a t i v e methods s u b m i t t e d f o r a p p r o v a l 1n s p e c i a l e d u c a t i o n p l a n s . 8. Th ere w er e no I n d i c a t i o n s t h a t t h e s t a t e has m o n i t o r e d a p p l i c a t i o n of t h e R u le s. C e r t a i n recom mendations were made t o Improve e q u i t y . DEDICATED to Dr. C h a r l e s V. Mange His s t e a d f a s t b e l i e f 1n t h e p r i n c i p l e s of equity# h i s compassionate b r i l li a n c e # and h i s t i r e l e s s e f f o r t s have al low ed many t o e x p e r i e n c e a r i c h e r l i f e . ACKNOWLEDGMENTS T h i s s t u d y would n o t hav e been c o m p l e t e d w i t h o u t t h e h e l p o f many people. F irst, e x t r e m e g r a t i t u d e 1s e x t e n d e d t o my d i s s e r t a t i o n d i r e c t o r and c o m m i t t e e c h a i r m a n , Dr. C h a r l e s V. Mange, whose wisdom, e n c o u r a g e ­ ment, and u n d e r s t a n d i n g t h r o u g h o u t t h e e n t i r e d o c t o r a l p r o c e s s made completion p o ssib le . I c a n n o t I m a g i n e any way t h a t he c o u l d have more f u l l y f i l l e d h i s r o l e a s m e n to r . Most g r a t e f u l a p p r e c i a t i o n 1s e x t e n d e d t o Dr. Ronald M. W o l t h u l s , my m a s t e r ’s program a d v i s o r and d o c t o r a l c o m m i t t e e member, f o r h i s friendship, Insightful g u i d a n c e , and c o n t i n u o u s s u p p o r t . S i n c e r e a p p r e c i a t i o n 1s e x t e n d e d t o c o m m i t t e e members Mrs. Lou Alonso f o r h e r c o n s i s t e n t and v a l u e d s u p p o r t and Dr. R o b e r t Poland f o r h i s h e l p f u l s u g g e s t i o n s and en c o u r a g e m e n t . A p p r e c i a t i o n 1s f u r t h e r e x t e n d e d t o t h e many p e o p l e who have f o s t e r e d my p r o f e s s i o n a l gr o w th a t d i f f e r e n t c a r e e r s t a g e s and a s s i s t e d me In r e a c h i n g t h e p o i n t w h er e a d i s s e r t a t i o n c o u l d be u nd e r ta k e n . Some o f t h e s e p e o p l e w ere M 1lt , J e r r y , Dale, Ken, George, Dr. Thompson, Jean, Don, P a u l , Helen, S an d r a, Sandee, Chuck, Dave, Gary, B i l l , Cash, J a n , and Russ. T h e i r I n f l u e n c e was p e rh a p s g r e a t e r t h a n t h e y knew. TABLE OF CONTENTS Page LIST OF TABLES................................................................................................................. vi LIST OF F I G U R E S ..................................................................................................................v i i i LIST OF APPENDICES........................................................................................................ ix C ha pt er I. II. III. INTRODUCTION ................................................................................................... 1 The P r o b l e m ............................................................................................. Need f o r t h e S t u d y ............................................................................... P u r p o se o f t h e S t u d y ........................................................................... D e f i n i t i o n s o f Terms ........................................................................... Overview o f t h e S t u d y ...................................................................... 1 3 4 5 9 REVIEW OF LITERATURE................................................................................. 11 I n t r o d u c t i o n ............................................................................................. H i s t o r i c a l P e r s p e c t i v e o f Michigan P u b l i c Acts . . . . Adoption o f a S p e c i a l E d u c a t i o n M l l l a g e ........................ D i s t r i b u t i o n o f S p e c i a l E d u c a ti o n M l l l a g e Funds to C onstituent D is tr ic ts ................................................ V a r i a t i o n s 1n I n t e r m e d i a t e School D i s t r i c t P r a c t i c e s f o r D i s t r i b u t i n g S p e c i a l E d u c a t i o n M l l l a g e Funds . . V a r i a t i o n s Due t o D i f f e r e n t I n t e r p r e t a t i o n s . . . . V a r i a t i o n s Due t o P r o v i s i o n s o f Law Not Being F o l l o w e d ............................................................................................. S p e c i a l E d u c a t i o n Task F o r c e o f 1977... ..................................... 1980 R e v i s i o n o f t h e S p e c i a l E d u c a ti o n R ules . . . . . 11 12 13 40 41 46 PROCEDURES........................................................................................................ 48 I n t r o d u c t i o n ............................................................................................. P o p u l a t i o n .................................................................................................. Resear ch Q u e s t i o n s ............................................................................... Design o f t h e S t u d y ........................................................................... L i m i t a t i o n s ............................................................................................. 48 48 48 50 55 iv 15 24 26 Page IV. ANALYSIS AND INTERPRETATION OF THE D A T A ........................... 57 I n t r o d u c t i o n ............................................................................................. R e s u l t s ....................................................................................................... R e s ea rc h Q u e s t i o n 1 . . . . . . . . R e s ea rc h Q u e s t i o n 2 Re s ea rc h Q u e s t i o n 3 Research Q uestion 4 57 57 57 75 135 140 ................................................... 144 I n t r o d u c t i o n ............................................................................................. C o n c l u s i o n s ............................................................................................. C o n c l u s i o n 1 ......................................................................................... C o n c l u s i o n 2 ......................................................................................... C o n c l u s i o n 3 ......................................................................................... C o n c l u s i o n 4 ......................................................................................... C o n c l u s i o n 5 ......................................................................................... C o n c l u s i o n 6 ......................................................................................... C o n c l u s i o n 7 ......................................................................................... C o n c l u s i o n 8 ......................................................................................... Recommendations .................................................................................... Recommendations f o r F u t u r e Research ..................................... 144 145 145 147 148 148 150 150 152 153 156 157 APPENDICES......................................................................................................................... 160 REFERENCES......................................................................................................................... 229 V. CONCLUSIONS AND RECOMMENDATIONS v LIST OF TABLES T a b le 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. Page C h r o n o l o g i c a l Summary o f t h e Legal P r o v i s i o n s f o r Adoptlnq a S p e c i a l E d u c a ti o n M l l l a g e and t h e Legal P r o v i s i o n s Governing D i s t r i b u t i o n o f Such Funds t o C o n s t i t u e n t School D i s t r i c t s ............................................................. 25 I n f o r m a t i o n S u b m it te d 1n 1984-85 ISD S p e c i a l E d u c a ti o n P l a n s Conce rnin g t h e D i s t r i b u t i o n o f S p e c i a l E d u c a t i o n M l l l a g e Funds .............................................................................................. 59 I n f o r m a t i o n Received From ISDs Co n cer n in g t h e D i s t r i b u t i o n o f S p e c i a l E d u c a ti o n M il l age Funds 63 . . . . ISDs R e p o r t i n g A l t e r n a t i v e D i s t r i b u t i o n Methods Not I n c l u d e d With in T h e i r S p e c i a l E d u c a ti o n P l a n s ................... 65 I n f o r m a t i o n Received From ISDs and S u b m i t t e d Wi thi n T h e i r S p e c i a l E d u c a ti o n P l a n s P e r t a i n i n g t o R u le s 340.1811 and 3 4 0. 18 12 76 F l a t - G r a n t D i s t r i b u t i o n Systems Used by ISDs 1n Michigan During t h e 1984-85 School Y e a r ........................................................ 80 Methods f o r D et e rm in in g F l a t G r a n t s Used by ISDs 1n Michigan During t h e 1984-85 School Year ................................. 82 A l t e r n a t i v e E x c e s s - C o s t D i s t r i b u t i o n Systems Used by ISDs During t h e 1984-85 School Y e a r ........................................... 84 A l t e r n a t i v e E x c e s s - C o s t Methods Used by ISDs During t h e 1984-85 School Y e a r ............................................................................... 85 D e t a i l o f V a r i a n t P r a c t i c e s f o r D e te r m in in g A ll o w a b l e C o s t s , C a l c u l a t i o n o f R e c e i p t s , a n d / o r t h e Manner of P a y m e n t ....................................................................................................... 93 H y p o t h e t i c a l Example o f t h e Rule 3 4 0 . 1 8 1 1 . S u b r u l e s ( 2 ) . ( 3 ) . and ( 4 ) , System f o r Reimbursement o f S p e c i a l E d u c a ti o n C o s ts t o C o n s t i t u e n t D i s t r i c t s ................................. 100 vi Page 12. 13. 14. 15. Comparison A n a l y s i s o f C o n s t i t u e n t D i s t r i c t Reimburse­ ment Under Rule 34 0.1811* S u b r u l e s (2)> (3)# and ( 4 ) , and a F l a t - G r a n t S y s t e m ............................................................. 105 Comparison A n a l y s i s o f C o n s t i t u e n t D i s t r i c t Reimburse­ ment Under Rule 340.1811* S u b r u l e s (2)» (3)> and (4)# and a P r o p o r t i o n a t e General Membership System . . . 126 Comparison A n a l y s i s o f C o n s t i t u e n t D i s t r i c t Reimburse­ ment Under Rule 340.1811* S u b r u l e s (2)» (3)» and (4)» and a Weighted Program C o s t D i s t r i b u t i o n System . . 129 C a l c u l a t i o n s f o r H y p o t h e t i c a l Weighted Program C os t D i s t r i b u t i o n S y s t e m ....................... 130 vi i LIST OF FIGURES F ig u r e 1. 2. Page I l l u s t r a t i o n o f t h e A n a l y s i s o f t h e 55 ISD S p e c i a l E du ca ti on P l a n s f o r 1984-85 ............................................................... 61 ISDs by Omission o f A l t e r n a t 1 v e - D 1 s t r 1 b u t 1 o n Methods 1n T h e i r S p e c i a l E d u c a t i o n P l a n s and Compliance With Rule 3 4 0 . 1 8 1 1 , S u b r u l e s ( 2 ) , ( 3 ) , and (4) . . . . 64 vi i i LIST OF APPENDICES A ppendix Page A. MICHIGAN PUBLIC ACT 18 OF 1954 ......................................................... 161 B. INTERMEDIATE SCHOOL DISTRICT SPECIAL EDUCATION MILLAGE RATES ......................................................................................... 168 SUMMARY TABLE OF LEGAL PROVISIONS CONCERNING THE ADOPTION AND THE DISTRIBUTION OF INTERMEDIATE SCHOOL DISTRICT SPECIAL EDUCATION MILLAGE ........................ 170 MICHIGAN DEPARTMENT OF EDUCATION CATEGORIES AND DEFINITIONS OF ALLOWABLE SPECIAL EDUCATION COSTS . . . 175 E. DATA-COLLECTION FORM FOR SPECIAL EDUCATION PLANS . . . . 196 F. LETTER TO INTERMEDIATE SCHOOL DISTRICT DIRECTORS OF SPECIAL EDUCATION ........................................................................... 2 0k C. D. G. ABSTRACT REQUEST F O R M .................................................................... H. DATA-COLLECTION FORM FOR INFORMATION RECEIVED FROM INTERMEDIATE SCHOOL DISTRICTS .................................................... 208 I. LETTER TO MICHIGAN DIRECTOR OF SPECIAL EDUCATION . . . . 210 J. LETTER TO MICHIGAN DEPARTMENT OF EDUCATION DESIGNEE K. LETTER RECEIVED FROM MICHIGAN DEPARTMENT OF EDUCATION DESIGNEE............................................................................................... L. 206 . . MICHIGAN DEPARTMENT OF EDUCATION LISTING OF REQUIREMENTS FOR THE REVIEW OF INTERMEDIATE SCHOOL DISTRICT SPECIAL EDUCATION PLANS ............................. ix 212 21^ 223 CHAPTER I INTRODUCTION Michi gan 1s d i v i d e d I n t o 57* I n t e r m e d i a t e school d i s t r i c t s (ISDs), each c o m p r i s i n g from 2 t o 34 l o c a l c o n s t i t u e n t s ch o ol d i s t r i c t s . The v o t e r s o f a l l b u t one ISD 1n Michi gan hav e ap pr o ve d t h e a d o p t i o n o f a s p e c i a l e d u c a t i o n m l l l a g e le v y . The l e v i e s v ar y among ISDs* r a n g i n g from t h r e e - f o u r t h s o f a m i l l t o f o u r m i l l s * and r a i s e more t h a n $163 m i l l i o n a n n u a l l y (Michigan Board o f Education* May* 1984)* which 1s e a r m a rk e d f o r t h e e d u c a t i o n of ha n di ca pp ed s t u d e n t s . The p r e s e n t st u d y was d e s i g n e d t o d i s c o v e r t h e manner 1n which ISDs d i s t r i b u t e t h e s e mo ni es t o c o n s t i t u e n t sch ool d i s t r i c t s t o s u p p o r t t h e e d u c a t i o n o f h a n d i c a p p e d c h i l d r e n who r e s i d e 1n t h e i r d i s t r i c t s . The Problem Michigan P u b l i c Act 18 o f 1954* The S p e c i a l E d u c a t i o n Act* a l l o w e d t h e e l e c t o r s o f an ISD t o a d o p t a s p e c i f i c p r o p e r t y t a x t o s u p p o r t t h e c o s t s o f e d u c a t i n g h an d i c a p p e d c h i l d r e n . Once a s p e c i a l e d u c a t i o n t a x was adopted* t h e p r o v i s i o n s o f t h e S p e c i a l E d u c a t i o n Act came I n t o effect. The Act c o n t a i n e d p r o v i s i o n s t h a t d e t a i l e d t h e manner 1n which *Two ISDs, Newago and Oceana, a r e j o i n e d f o r t h e p u r p o s e o f coop­ e r a t i n g 1n p r o v i d i n g s p e c i a l e d u c a t i o n prog ram s and s e r v i c e s . With r e s p e c t t o s p e c i a l e d u c a t i o n p r og ra m s and s e r v i c e s , M ich ig an 1s d i v i d e d 1 n t o 56 ISDs. 1 2 funds r a i s e d w e r e t o be d i s t r i b u t e d t o c o n s t i t u e n t scho ol d i s t r i c t s . The problem c o n c e r n i n g t h e d i s t r i b u t i o n of s p e c i a l e d u c a t i o n m l l l a g e fun ds a r o s e p r i m a r i l y bec a u se of t h e f o l l o w i n g t w o s i t u a t i o n s . 1. The p r o v i s i o n s g o v e r n i n g t h e d i s t r i b u t i o n o f s p e c i a l e d u c a t i o n m i l l age funds w ere I n t e r p r e t e d d i f f e r e n t l y by many ISDs; and 2. ISDs w ere a c c o u n t a b l e o nl y t o t h e m s e l v e s , a s t h e S t a t e D e p a r t ­ ment of E d u c a ti o n d id n o t c o l l e c t o r r e c e i v e d a t a c o n c e r n i n g t h e manner 1n which s p e c i a l e d u c a t i o n m l l l a g e f u n d s w er e distributed. For t h e s e tw o r e a s o n s , many v a r i a t i o n s r e s u l t e d among ISDs 1n t h e a c t u a l p r a c t i c e s th e y used 1n d i s t r i b u t i n g s p e c i a l e d u c a t i o n m l l l a g e funds. These v a r i a t i o n s r a i s e d c o n c e r n s among s e g m e n t s o f t h e s p e c i a l e d u c a t i o n community, a s w e l l a s among l e g i s l a t o r s and p o l i c y m a k er s, r e g a r d i n g t h e e q u i t a b l e d i s t r i b u t i o n o f s p e c i a l e d u c a t i o n m l l l a g e fun ds t o s u p p o r t t h e e d u c a t i o n o f han di ca pp ed s t u d e n t s . In an a t t e m p t t o remedy t h i s problem, P u b l i c Act 198 o f 1971, p o p u l a r l y r e f e r r e d t o as M ic h i g a n ' s Mandatory S p e c i a l E d u c a t i o n Act, c o n t a i n e d a p r o v i s i o n ( S e c t i o n 317a) r e q u i r i n g ISDs t h a t had ap p ro v ed a s p e c i a l e d u c a t i o n le vy t o expend fund s 1n a c c o r d a n c e w i t h r u l e s promu l­ g a t e d by t h e S t a t e Board o f Educ at ion . Th is Act, which to o k e f f e c t 1n J u l y 1972, a l s o r e p e a l e d t h e f o r m e r la n g u a g e g o v e r n i n g t h e d i s t r i b u t i o n of sp ec ia l e d u c a t i o n m l l l a g e funds ( S e c t i o n 2) and r e p l a c e d t h a t l a n ­ guage w i t h a r e q u i r e m e n t t h a t t h e Michigan D e p a r t m e n t o f E d u c a t i o n p u b l i s h r u l e s g o v e r n in g t h e d i s t r i b u t i o n o f t h e s e fu n ds . However, I n s t e a d o f t h e e n v i s i o n e d r e d u c t i o n of c o n c e r n s , t h e pro ble m was 3 I n t e n s i f i e d b e ca us e t h e S t a t e Board o f E d u c a ti o n d id n o t p r o m u l g a t e t h e r e q u i r e d r u l e s u n t i l August 1980. Thus, f o r more t h a n e i g h t y e a r s , no r e g u l a t o r y p r o v i s i o n s w e r e 1n f o r c e t h a t governed t h e d i s t r i b u t i o n o f s p e c i a l e d u c a t i o n m l l l a g e funds. In August 1980, t h e Michi gan Board o f E d u c a ti o n p u b l i s h e d a r e v i ­ s i o n o f t h e Michigan S p e c i a l E d u c a ti o n Rules. Two r u l e s were added (Rule 340.1811 and Rule 340.1812) t o govern t h e d i s t r i b u t i o n and use of ISD s p e c i a l e d u c a t i o n m l l l a g e fun ds . The r u l e s were d e v i s e d t o e n s u r e t h a t c o n s t i t u e n t school d i s t r i c t s and t h e i r h an di cap ped s t u d e n t s a r e t r e a t e d f a i r l y 1n t e r m s o f f i n a n c i a l s u p p o r t and t o e s t a b l i s h a more c o n s i s t e n t l e v e l of f i s c a l s u p p o r t f o r ha nd ic ap p ed s t u d e n t s among ISDs t h r o u g h o u t t h e s t a t e (Mange, 1984). A q u e stio n t h a t remains, however, 1s w h e t h e r s p e c i a l e d u c a t i o n m l l l a g e funds a r e b e i n g d i s t r i b u t e d f a i r l y and c o n s i s t e n t l y , a s r e q u i r e d by t h e Michigan S p e c i a l E d u c a ti o n Rules. Need f o r t h e Study The need f o r t h i s s t u d y a r o s e from t h e f a c t t h a t no I n f o r m a t i o n 1s a v a i l a b l e on a s t a t e w i d e b a s i s r e g a r d i n g t h e a c t u a l use and s t a t u s o f ISD s p e c i a l e d u c a t i o n t a x r e c e i p t s . Michigan r e g u l a t i o n s p e r t a i n i n g t o such use a r e p r e d i c a t e d on t h e p r i n c i p l e o f e q u i t y and c o n t a i n c e r t a i n s p e c i f i c r e q u i r e m e n t s (or a l t e r n a t i v e s ) t o e n s u r e I m p a r t i a l i t y . There have been I n d i c a t i o n s t h a t e q u i t y has s o m et im e s been compromised or r ed uc e d. I f so, a t l e a s t t h r e e s i g n i f i c a n t pro ble m s can a r l s a F irst, a s a l r e a d y n o te d , c e r t a i n c o n s t i t u e n t school d i s t r i c t s o f t h e ISD may be t r e a t e d d i f f e r e n t l y from o t h e r s w i t h r e s p e c t t o f i n a n c i a l s u p p o r t . U n f o r t u n a t e l y , t h e f u n d i n g sy ste m i s s u f f i c i e n t l y complex t h a t many 4 c o n s t i t u e n t d i s t r i c t s would n o t n e c e s s a r i l y be a w a r e o f such I n e q u i t y 1f 1 t e x i s t e d . Second* c e r t a i n ISDs have c l a i m e d g r e a t f i n a n c i a l d i f f i c u l t y w i t h a g i v e n m l l l a g e * w h er ea s o t h e r s w i t h t h e same m l l l a g e a p p e a r t o have much l e s s d i f f i c u l t y s u p p o r t i n g n e c e s s a r y p ro g ram s and services. P e r h a p s t h e r e a s o n f o r t h e s e d i f f e r e n c e s l i e s 1n t h e manner of u s e and d i s t r i b u t i o n o f a v a i l a b l e fun ds . T h i r d 1s t h e m a t t e r o f p u b l i c and l e g i s l a t i v e f a i t h 1n t h e a p p r o p r i a t e s t e w a r d s h i p o f s p e c i a l e d u c a t i o n fun ds . I f t h e l e g i s l a t u r e and t h e t a x p a y e r s a r e t o s u p p o r t t h e s e s p e c i a l ta xe s* t h e r e 1s a g r e a t need t o e n s u r e c o m p a r a b i l i t y * eq ui ty * and e f f i c i e n c y 1n t h e u s e of t h e m oni es p r o v id e d . t h e e x t e n t o f t r u s t and f a i t h In t h e sy st em . At s t a k e 1s T h e r e a r e some su g g es ­ t i o n s t h a t t h e needed l e v e l o f l e g i s l a t i v e and p u b l i c s u p p o r t may be e r o d e d th r o u g h c e r t a i n p r a c t i c e s . P u r p o se o f t h e Study Th is s t u d y was u n d e r t a k e n t o d i s c o v e r w h e t h e r t h e Michi gan S p e c i a l E d u c a t i o n R ul e s g o v e r n i n g t h e d i s t r i b u t i o n o f ISD s p e c i a l e d u c a t i o n m l l l a g e fu n d s a r e b e i n g f o l l o w e d and t o d e t e r m i n e w ha t p r o c e s s e s t h e Michi gan D e p a r tm e n t o f E d u c a ti o n 1s u s i n g t o e n s u r e c o m p l i a n c e w i t h th e se provisions. 1. The p u r p o s e s o f t h i s s t u d y we re: To l e a r n w h e t h e r c o n s t i t u e n t school d i s t r i c t s and t h e i r h a n d i ­ capped c h i l d r e n a r e t r e a t e d 1n a c c o r d w i t h a p p l i c a b l e r e g u l a ­ t i o n s f o r f i n a n c i a l s u p p o r t both w i t h i n and among ISDs* 5 2. To exam ine any r e p o r t e d ISD a l t e r n a t i v e f i n a n c i a l support s y s t e m s t o l e a r n w h e t h e r t h e s e s y s t e m s enh anc e o r d i m i n i s h e q u i t y 1n d i s t r i b u t i n g s u p p o r t f u n d s , and 3. To g e n e r a t e e m p i r i c a l e v i d e n c e t h a t c o u l d a f f e c t f u tu r e policy d e c i s i o n s r e g a r d i n g t h e d i s t r i b u t i o n of s p e c i a l e d u c a t i o n m l l l a g e t a x funds. D e f i n i t i o n s o f Terms For p r e c i s i o n and c o n s i s t e n c y , a s well a s t o I n c r e a s e c l a r i t y and c o n tin u ity for th e reader, th e follow ing term s a re defined. Added c o s t — t h e amount s p e n t t o p r o v i d e a s p e c i a l e d u c a t i o n pr o ­ gram o r s e r v i c e , 1n e x c e s s o f t h e amount s p e n t f o r no nha ndi cap ped s t u d e n t s 1n r e g u l a r e d u c a t i o n programs. Adoption o f a s p e c i a l e d u c a t i o n m l l l a g e — a m a j o r i t y v o t e o f t h e e l e c t o r s o f an ISD a p p r o v i n g a p r o p e r t y t a x t o s u p p o r t s p e c i a l ed uca ­ t i o n pr ograms and s e r v i c e s . A l l o w a b l e c o s t s — t h e c a t e g o r i e s and e x p e n d i t u r e s p e r m i t t e d on t h e s t a t e c o s t r e p o r t s f o r d i s c l o s i n g a s ch oo l d i s t r i c t ’s a c t u a l c o s t s f o r p r o v i d i n g s p e c i a l e d u c a t i o n programs and s e r v i c e s . C a l c u l a t i o n o f r e c e i p t s — t h e methods used t o compute t h e amount o f money a school d i s t r i c t r e c e i v e s from s o u r c e s o t h e r t h a n t h e ISD (I.e., s t a t e membership a l l o w a n c e , s t a t e categ o rical aid, and f e d e r a l fun ds ) t o s u p p o r t t h e s p e c i a l e d u c a t i o n program. C a t e g o r i c a l a i d — t h e method and fun ds used by t h e s t a t e t o g r a n t s u b s i d i e s 1n a d d i t i o n t o "membership1' a i d t o school d i s t r i c t s f o r p a r t i c u l a r purposes. C a t e g o r i c a l a i d 1s d e t e r m i n e d a n n u a l l y 1n t h e 6 S t a t e Aid Act and I n c l u d e s e a r m a rk e d s u b s i d i e s f o r s p e c i a l e d u c a t i o n pr o gr am s and s e r v i c e s p r i m a r i l y 1n t h r e e s e c t i o n s (or c a t e g o r i e s ) . The g e n e r a l c a t e g o r y o f s p e c i a l s u p p o r t f o r s p e c i a l e d u c a t i o n programs# which 1s based on t h e " a d d e d - c o s t s sy stem#11 1s found 1n S e c t i o n s 51 and 52. C a t e g o r i c a l a i d 1s a l s o g r a n t e d f o r s p e c i a l e d u c a t i o n p u r p o s e s 1n S e c t i o n 53 (100% o f added c o s t s f o r n o n r e s i d e n t c o u r t - p l a c e d s t u d e n t s ) and 1n S e c t i o n 71 ( s p e c i a l education tr a n s p o rta tio n ). C o n s t i t u e n t sch oo l d i s t r i c t — a l o c a l sc h o o l d i s t r i c t t h a t 1s I d e n t i f i e d a s a c o n s t i t u e n t member o f a g i v e n ISD. (All l o c a l school d i s t r i c t s a r e c o n s t i t u e n t members o f an ISD.) Cl ai m on t h e ISD s p e c i a l e d u c a t i o n fund— t h e c e l l i n g amount a l o c a l s c h o o l d i s t r i c t 1s e l i g i b l e t o r e c e i v e from t h e s p e c i a l e d u c a t i o n m l l l a g e t a x r e v e n u e s o f I t s ISD. D i s t r i b u t i o n o f s p e c i a l e d u c a t i o n m l l l a g e — t h e manner 1n which r e v e n u e s from t h e s p e c i a l e d u c a t i o n t a x a r e d i s b u r s e d t o s u p p o r t s p e ­ c i a l e d u c a t i o n pr ograms and s e r v i c e s w i t h i n t h e ISD and I t s c o n s t i t u e n t school d i s t r i c t s . E q u i t y 1n t h e d i s t r i b u t i on o f ISD s p e c i a l e d u c a t i o n m l l l a g e — a H k e - p e r c e n t o f f i n a n c i a l s u p p o r t t o c o n s t i t u e n t sc ho ol d i s t r i c t s f o r t h e a d d i t i o n a l c o s t s of p r o v i d i n g s p e c i a l e d u c a t i o n pr ograms and s e r v ­ ices. T h i s d e f i n i t i o n r e q u i r e s a p e r c e n t a g e b a s i s which was p r e c i s e l y t h a t r e q u i r e d 1n P u b l i c Act 18 of 1954 and 1s now embodied w i t h i n t h e Michigan S p e c i a l E d u c a t i o n Rules. an equal level The p r i n c i p l e o f e q u i t y r e l a t e s t o ( 1 1 k e - p e r c e n t ) o f f i s c a l sup po rt# d o l l a r amount o f s u p p o r t . r a t h e r t h a n an equal If additional costs to all c o n s titu e n t 7 sc hoo l d i s t r i c t s w e r e equal* an equal d o l l a r amount o f s u p p o r t would be equitable. However, b e c a u s e t h e a d d i t i o n a l c o s t s o f p r o v i d i n g s p e c i a l e d u c a t i o n p ro g ram s and s e r v i c e s va r y both among and w i t h i n sch ool d istricts, d i s b u r s i n g eq u al d o l l a r amounts of s u p p o r t would v i o l a t e t h e p r i n c i p l e of e q u i t y . For exam ple, 1f t h e a d d i t i o n a l c o s t s t o p r o v i d e a s p e c i a l e d u c a t i o n program 1n D i s t r i c t A were $35,000 and 1n D i s t r i c t B t h e y were $15,000, an equa l d o l l a r amount ( f l a t - s u p p o r t s y st e m ) o f $5,000 r e i m b u r s e m e n t t o each d i s t r i c t would n o t be e q u i t a b l e . Note t h a t t h e a d d i t i o n a l c o s t s f o r both D i s t r i c t A and D i s t r i c t B a r e $50,000 ($35,000 + $15,000). t h e tw o d i s t r i c t s , I f $10,000 1s a v a i l a b l e t o d i s t r i b u t e t o a H k e - p e r c e n t payment would be 20% o f t h e i r r e s p e c ­ t i v e a d d i t i o n a l c o s t s ($50,000 d i v i d e d by $10,000 = 20%). Therefore, an e q u i t a b l e l e v e l of s u p p o r t would be f o r D i s t r i c t A t o r e c e i v e $7,000 (20% x $35,000) and D i s t r i c t B t o r e c e i v e $3,000 (20% x $15,000). I n t e r m e d i a t e sch ool d i s t r i c t (ISD)— an e d u c a t i o n a l agency o p e r ­ a t i n g a t a r e g i o n a l l e v e l and c o m p r i s i n g s e v e r a l l o c a l c o n s t i t u e n t d istricts. ISD s p e c i a l e d u c a t i o n fund— t h e money g e n e r a t e d by an ISD s p e c i a l e d u c a t i o n m l l l a g e , I n c l u d i n g both t h e c u r r e n t y e a r l y r e v e n u e and any a c c r u e d revenue. Membership a l l o w a n c e ( o f t e n r e f e r r e d t o a s s i m p l y " me m ber shi p” )— t h e s t a t e - d e t e r m i n e d per s t u d e n t and per m i l l amount g u a r a n t e e d t o be a v a i l a b l e t o a school d i s t r i c t f o r g e n e r a l program o p e r a t i o n . This per s t u d e n t amount 1s a g u a r a n t e e d l e v e l o f f i n a n c i a l s u p p o r t p e r m i l l of l o c a l t a x e f f o r t ; t h e s t a t e makes up t h e d i f f e r e n c e . I f any, be tw ee n 8 w hat a l o c a l school d i s t r i c t r e c e i v e s 1n p r o p e r t y t a x r e v e n u e s and t h e guaranteed level of support. M ic h ig an Board o f E d u c a t i o n — a c o n s t i t u t i o n a l l y e s t a b l i s h e d body t h a t s e r v e s a s t h e g e n e r a l p l a n n i n g and c o o r d i n a t i n g u n i t f o r a l l p u b l i c e d u c a t i o n 1n Michigan. M ich ig an D e p a r tm e n t o f E d u c a ti o n — t h e a d m 1 n 1 s t r a t 1 v e u n i t o f t h e Michi gan Board o f E d u c a t i o n r e s p o n s i b l e f o r p e r f o r m i n g d u t i e s and I m p l e m e n t in g p o l i c i e s a s d e l e g a t e d by law and d i r e c t e d by t h e Board. Mich iga n p u b l i c a c t — a law approved by both b r an ch e s of t h e Michi­ gan l e g i s l a t u r e and h a v in g f o r c e 1n Michigan. stitu tio n , Next t o t h e S t a t e Con­ 1 t 1s t h e g o v e r n i n g l e v e l o f Michi gan law. M ich ig an S p e c i a l E d u c a ti o n Rule s— t h e r u l e s t o I m pl em en t t h e la ws p e r t a i n i n g t o e d u c a t i o n of h a n di ca pp ed c h i l d r e n t h a t have been promul­ g a t e d by t h e Michigan Board o f Ed u ca ti o n , approved by a j o i n t l e g i s ­ l a t i v e c o m m i t t e e and t h e S t a t e A t t o r n e y G e n e r a l ' s o f f i c e , and f i l e d w i t h t h e S e c r e t a r y of S t a t e . (These r u l e s govern t h e o p e r a t i o n of Michigan s p e c i a l e d u c a t i o n pro gr ams and s e r v i c e s . ) M l l l a g e— t h e t a x a t i o n r a t e a p p l i e d a g a i n s t t h e s t a t e e q u a l i z e d v a l u a t i o n (SEV) o f p r o p e r t y . A m i l l e q u a l s o n e - t e n t h o f a c e n t o r one d o l l a r f o r ev er y th o u s a n d d o l l a r s o f v a l u a t i o n . M lllage: s p e c i a l e d u c a t i o n m l l l a g e — a v o t e r - a p p r o v e d t a x t o le vy a s p e c i f i c number o f m i l l s on t h e p r o p e r t y o f an ISD, w it h t h e r ev en u e s e a r m a r k e d f o r t h e s u p p o r t o f s p e c i a l e d u c a t i o n pr ograms and s e r v i c e s . S p e c i a l e d u c a t i o n p l a n — a l e g a l l y r e q u i r e d document deve lo ped a n n u a l l y by an ISD 1n c o o p e r a t i o n w i t h l o c a l c o n s t i t u e n t sch ool 9 d i s t r i c t s and t h e i r s p e c i a l e d u c a t i o n p a r e n t a d v i s o r y c o m m i t t e e , which has been ap pr ov ed by t h e S t a t e Board o f Ed u ca ti o n . T h i s pl a n d e t a i l s how an ISO and I t s l o c a l c o n s t i t u e n t school d i s t r i c t s I n t e n d t o me e t t h e o b l i g a t i o n t o p r o v i d e s p e c i a l e d u c a t i o n pro gr ams and s e r v i c e s t o t h e i r ha n di ca pp ed s t u d e n t s . S t a t e e q u a l i z e d v a l u a t i o n (SEV)— t h e a s s e s s e d v a l u e of p ro p er ty * a d j u s t e d by a m u l t i p l i c a t i o n f a c t o r t o e q u a l i z e any a s s e s s i n g d i f f e r ­ en ce s among t h e v a r i o u s t a x i n g u n i t s 1n Michigan. (The p u r po s e 1s t o e n s u r e t h a t p r o p e r t y t h r o u g h o u t Michigan 1s a s s e s s e d a t 50% of I t s t r u e cash value.) Overview of t h e Study The r e m a i n d e r of t h i s d i s s e r t a t i o n 1s o r g a n i z e d 1n t h e f o l l o w i n g manner. In C h a p t e r I I t h e p e r t i n e n t l i t e r a t u r e 1s r e vi e w e d. r e v ie w c o n t a i n s f o u r p a r t s . Th is The f i r s t 1s a c o m p r e h e n s i v e h i s t o r i c a l r ev ie w o f t h e Michigan p u b l i c a c t s c o n t a i n i n g t h e p r o v i s i o n s f o r adop­ t i o n o f a s p e c i a l e d u c a t i o n m i l l age and d i s t r i b u t i o n of s p e c i a l educa­ t i o n m l l l a g e fund s t o c o n s t i t u e n t school d i s t r i c t s . The second p a r t of t h e r e v ie w d e a l s s p e c i f i c a l l y w i t h v a r i a t i o n s 1n ISD p r a c t i c e s f o r d i s t r i b u t i n g s p e c i a l e d u c a t i o n m l l l a g e fun ds. The t h i r d p a r t r e v i e w s t h e r e p o r t of t h e S p e c i a l E d u c a ti o n Ad Hoc Task F o rce o f 1977* which I d e n t i f i e d p r o b le m s w i t h t h e d i s t r i b u t i o n o f s p e c i a l e d u c a t i o n m l l l a g e f u n d s and g e n e r a t e d rec o m m en d at io n s t o a s s i s t 1n a l l e v i a t i n g t h e prob­ lem. P r e s e n t e d 1n t h e f o u r t h p a r t of C h a p t e r I I a r e t h e tw o r u l e s 10 added t o govern t h e d i s t r i b u t i o n and use o f s p e c i a l e d u c a t i o n m l l l a g e f u n d s 1n t h e 1980 r e v i s i o n o f t h e Michigan S p e c i a l E d u c a t i o n Rules. The p r o c e d u r e s f o l l o w e d 1n c o n d u c t i n g t h i s s t u d y a r e p r e s e n t e d 1n Chapter I I I . In C h ap t er IV» t h e r e s u l t s and m a j o r f i n d i n g s of t h e I n v e s t i g a t i o n a r e p r e s e n t e d and d i s c u s s e d . Chapter V c o n ta in s t h e c o n c l u s i o n s of t h e s t u d y and re c o m m e n d a t io n s f o r f u r t h e r r e s e a r c h . CHAPTER I I REVIEW OF LITERATURE Introduction The r e v ie w o f l i t e r a t u r e 1s d i v i d e d I n t o t h e f o l l o w i n g f o u r parts: 1. A h i s t o r i c a l p e r s p e c t i v e of t h o s e P u b l i c Acts o f Michi gan t h a t c o n t a i n t h e l e g a l p r o v i s i o n s f o r both (a) t h e a d o p t i o n of an ISO s p e c i a l e d u c a t i o n m l l l a g e and (b) t h e d i s t r i b u t i o n o f s p e c i a l e d u c a t i o n m l l l a g e fund s t o c o n s t i t u e n t s c h o o l d i s ­ tricts, 2. V a r i a t i o n s 1n ISD p r a c t i c e s f o r d i s t r i b u t i n g s p e c i a l e d u c a t i o n m l lla g e funds, 3. The p r o b le m s I d e n t i f i e d by t h e S p e c i a l E d u c a ti o n Ad Hoc Task Fo rce o f 1977 c o n c e r n i n g t h e methods used by ISDs t o d i s t r i b ­ u t e s p e c i a l e d u c a t i o n m i l l age funds t o c o n s t i t u e n t d i s t r i c t s and t h e re co m m e n d a t io n s g e n e r a t e d f o r r e l i e f from t h e s e con­ cerns, 4. and The 1980 r e v i s i o n of t h e Michigan S p e c i a l E d u c a t i o n R u le s, which added two r u l e s t o govern t h e d i s t r i b u t i o n o f ISD special e d u c a t i o n m l l l a g e funds. 11 12 H i s t o r i c a l P e r s p e c t i v e o f Michigan P u b l i c A cts The l e g a l p r o v i s i o n s f o r t h e ISD s p e c i a l e d u c a t i o n m l l l a g e o r i g i ­ n a t e d w i t h t h e p a s s a g e o f P u b l i c Act 18 of 1954 (Appendix A). a perm issive type of l e g i s l a t i o n , T h i s was which a u t h o r i z e d v o t e r s o f a coun ty school d i s t r i c t * t o a d o p t a s p e c i f i c p r o p e r t y t a x t o s u p p o r t t h e c o s t s o f e d u c a t i n g h an d i c a p p e d c h i l d r e n . Only 1f a s p e c i a l e d u c a t i o n m i l l a g e t a x was ap pro ved d id t h e p r o v i s i o n s o f P u b l i c Act 18 t a k e e f f e c t . Th is la nd m ar k l e g i s l a t i o n , which 1s a c c u r a t e l y t e r m e d t h e S p e c i a l E d u c a ti o n Act, l a i d t h e f o u n d a t i o n on which s p e c i a l e d u c a t i o n pro gr ams and s e r v ­ i c e s f o r h a n d i c a p p e d c h i l d r e n 1n Michigan have been c o n s t r u c t e d . The preamble reads: AN ACT t o p r o v i d e f o r t h e f i n a n c i n g , a d m i n i s t r a t i o n and o p e r a t i o n o f s p e c i a l e d u c a t i o n p r o g ra m s f o r h a n d i c a p p e d c h i l d r e n by s ch o ol d i s t r i c t s , I n c l u d i n g c o u n t y scho ol d i s t r i c t s ; t o p r o v i d e f o r t h e g r a n t i n g o f f i n a n c i a l a s s i s t a n c e by cou nt y sc h o o l d i s t r i c t s t o c o n s t i t u e n t sch oo l d i s t r i c t s f o r s p e c i a l e d u c a t i o n h o u s in g o r p r o ­ gr am s; t o p r o v i d e f o r co u n t y s ch o ol d i s t r i c t s and c o n s t i t u e n t d i s t r i c t s t o bind t h e m s e l v e s t o g e t h e r by c o n t r a c t f o r l o n g - t e r m c o o p e r a t i o n 1n s p e c i a l e d u c a t i o n e n t e r p r i s e ; and t o p r o v i d e f o r t h e a l l o c a t i o n , l e v y i n g , c o l l e c t i o n and h a n d l i n g o f a coun ty s ch oo l t a x f o r s p e c i a l e d u c a t i o n . ( P u b l i c Act 18 o f 1954, entltlem ent) Two comp on ents o f t h e S p e c i a l E d u c a ti o n Act a r e of p a r t i c u l a r I m p o r t a n c e t o t h i s s tu d y . special These a r e (a) t h e p r o v i s i o n s f o r a d o p t i n g a e d u c a t i o n m i l l a g e and (b) t h e p r o v i s i o n s g o v e r n i n g t h e d i s t r i ­ b u t i o n of su ch f u n d s t o c o n s t i t u e n t sch ool d i s t r i c t s . Each of t h e s e *ISDs w e r e known a s c o u nt y school d i s t r i c t s u n t i l t h e name was changed by P u b l i c Act 190 o f 1962. 13 co m po nen ts 1s d e s c r i b e d 1n t h e f o l l o w i n g pages a s o r i g i n a l l y p r e s e n t e d 1n t h e l e g i s l a t i o n and a s t h e y have been amended, r e p e a l e d , o r I n c l u d e d w i t h i n s u c c e e d i n g a c t s o f t h e Michigan L e g i s l a t u r e . Adoption o f a S p e c i a l E du ca tio n M l l l a g e As s t a t e d e a r l i e r , t o q u a l i f y f o r t h e p r o v i s i o n s o f P u b l i c Act 18 o f 1954, a m a j o r i t y of t h e e l e c t o r s o f a county scho ol d i s t r i c t w er e r e q u i r e d t o v o t e and ap p r o v e a s p e c i a l e d u c a t i o n m l l l a g e le v y. The o r i g i n a l l a n g u a g e a l l o w e d o n l y c o u n t i e s t h a t had a p o p u l a t i o n o f 390,000 o r more t o a d o p t t h e S p e c i a l E d u c a ti o n Act ( P u b l i c Act 18 of 1954, S e c t i o n 2). In 1955, t h e p r o v i s i o n s o f P u b l i c Act 18 o f 1954 w ere I n c o r p o r a t e d w i t h i n t h e School Code o f 1955 ( P u b l i c Act 269 of 1955, S e c t i o n s 309 -327 ). The s e c t i o n r e g a r d i n g p o p u l a t i o n r e q u i r e m e n t s was r e v i s e d t o a l l o w e l e c t o r s o f c o u n t i e s w i t h p o p u l a t i o n s o f 180,000 o r more t o c o n s i d e r t h e q u e s t i o n o f a d o p t i o n . Language was a l s o added t o t h i s s e c tio n t h a t allow ed fo r t h e adoption of a special education m l l l a g e le v y by two o r more c o u n t i e s o f l e s s t h a n 15,000 p eo pl e eac h, which had j o i n e d t o g e t h e r a s a "combined d i s t r i c t " ( P u b l i c Act 269 of 1955, S e c t i o n 310). S e v e r a l months l a t e r , t h i s s e c t i o n was amended t o e l i m i n a t e t h e p o p u la tio n req u ire m e n ts a s s o c ia te d with adoption of t h e a c t ( P u b l i c Act 4 o f t h e F i r s t E x t r a S e s s i o n o f 1955). Thi s change meant t h a t t h e e l e c t o r s o f a l l county school d i s t r i c t s c o u l d c o n s i d e r t h e q u e s t i o n o f a d o p t i n g a s p e c i a l e d u c a t i o n m i l l a g e and t h e accompany­ ing provisions. An I m p o r t a n t c o n d i t i o n c o n c e r n i n g t h e a d o p t i o n o f a s p e c i a l ed uca ­ t i o n m l l l a g e and t h e accompanying p r o v i s i o n s was t h a t on ce v o t e d on and 14 approved by t h e e l e c t o r s , a n o t h e r v o t e o f t h e e l e c t o r s was r e q u i r e d t o amend o r remove 1 t ( P u b l i c Act 18 o f 1954, S e c t i o n 2, a s I n c o r p o r a t e d by P u b l i c Act 269 of 1955, S e c t i o n 310, a s r e p e a l e d and added by P u b l i c Act 190 o f 1962, S e c t i o n 2 and S e c t i o n 30 7a, respectively). For a l l p r a c t i c a l p u r p o s e s , t h i s r e q u i r e m e n t made t h e s p e c i a l e d u c a t i o n m l l l a g e le v y a perma nen t t a x , a s 1 t does n o t e x p i r e and co u ld o n ly be changed by a s p e c i f i c v o t e of t h e e l e c t o r s o f t h e ISD 1n q u e s t i o n . To d a t e , t h e r e ha s ne ve r been a v o t e t o remove a s p e c i a l e d u c a t i o n m l l l a g e ( B a x t e r, 1985). In 1976, t h e s e c t i o n c o n t a i n i n g t h e c l a u s e r e q u i r i n g a n o t h e r v o t e of t h e e l e c t o r s t o amend o r remove t h e s p e c i a l e d u c a t i o n le v y was r e p e a l e d by t h e School Code o f 1976 ( P u b l i c Act 451 o f 1976, S e c t i o n 1851 HhD). special A new s e c t i o n was added r e g a r d i n g t h e a d o p t i o n o f a e d u c a t i o n m l l l a g e ( P u b l i c Act 451 o f 1976, S e c t i o n 1722 [ 1 ] ) , which did n o t I n c l u d e t h e p r e v i o u s s t a t e m e n t a b o u t amending o r removing t h e specia l education tax. effect, T h i s new s e c t i o n , which 1s c u r r e n t l y 1n reads: The q u e s t i o n o f a d o p t i n g 1722 t o 1729 may be s u b m i t t e d t o t h e sc hoo l e l e c t o r s o f an I n t e r m e d i a t e sc h o o l d i s t r i c t a t an annual e l e c t i o n o r a t a s p e c i a l e l e c t i o n h e l d 1n each o f t h e c o n s t i t u e n t districts. S e c t i o n s 1722 t o 1729 s h a l l be e f f e c t i v e 1f approved by a m a j o r i t y of t h e sc h o o l e l e c t o r s o f an I n t e r m e d i a t e school d i s ­ t r i c t voting. . . . ( P ub l 1c A c t 451 o f 1 9 7 6 , S e c t i o n 1722 C l ] , 1n part) S e c t i o n s 1722 t o 1729 r e f e r r e d t o above s p e c i f i c a l l y c o n c e r n t h e a d o p t i o n o r i n c r e a s e o f a s p e c i a l e d u c a t i o n m l l l a g e t a x and how t h e funds r a i s e d a r e t o be d i s t r i b u t e d ( P u b l i c Act 451 of 1976, S e c t i o n s 1722-1729). There 1s no p r o v i s i o n f o r remov ing o r r e d u c i n g a s p e c i a l e d u c a t i o n m l l l a g e lev y. 15 P u b l i c Act 191 was p a s s e d 1n 1963 t o add a s e c t i o n t o t h e School Code o f 1955 ( P u b l i c Act 191 o f 1963 added S e c t i o n 316b t o P u b l i c Act 269 o f 1955, as amended) t o a l lo w f o r I n c r e a s i n g t h e s p e c i a l e d u c a t i o n m l l l a g e t a x bec a u se P u b l i c Act 18 o f 1954 ( a s I n c o r p o r a t e d by P u b l i c Act 269 of 1955, as amended) d i d n o t c o n t a i n s p e c i f i c p r o v i s i o n s f o r I n c r e a s i n g t h e s p e c i a l e d u c a t i o n m l l l a g e r a t e once a m l l l a g e had been adopted. As m e n ti o n ed above, t h e p r o v i s i o n a l l o w i n g a s p e c i a l m l l l a g e t a x t o be I n c r e a s e d c o n t i n u e s t o be 1n e f f e c t and has been i n c o r p o r a t e d 1n t h e School Code o f 1976 ( P u b l i c Act 451 of 1976, S e c t i o n 1724). Today, 56 o f M i c h i g a n ' s 57 ISDs l e v y a s p e c i a l e d u c a t i o n m i l l a g e , which v a r i e s from t h r e e - f o u r t h s o f a m i l l t o f o u r m i l l s (Appendix B). Th is l e v y 1s ea r m ar ke d t o s u p p o r t s p e c i a l e d u c a t i o n pr ograms and s e r v ­ ices. D i s t r i b u t i o n of Special Education MUlage Funds t o C o n s t i t u e n t D i s t r i c t s Need f o r F i n a n c i a l Aid t o C o n s t i t u e n t D i s t r i c t s f o r S p e c i a l E d uc a ti o n In g e n e r a l , I t c o s t s more t o p r o v i d e e d u c a t i o n a l s e r v i c e s t o han di ca pp ed s t u d e n t s t h a n t o nonhan dic app ed s t u d e n t s ( S p e c i a l E d u c a ti o n Task Forc e R ep o r t , 1977, p. 78). These a d d i t i o n a l c o s t s va r y both among h a n di ca pp ed s t u d e n t s t h e m s e l v e s and among t h e sch oo l d i s t r i c t s providing serv ice s. Some of t h e r e a s o n s f o r t h e s e v a r y i n g c o s t s Include: 1. V a r i a b l e t e a c h e r / s t u d e n t r a t i o s ( f o r ex am p le, 1f tw o t e a c h e r s each r e c e i v e d t h e same s a l a r y and o t h e r e x p e n s e s w ere h e l d 16 c o n s ta n t * a te a c h e r serv in g f iv e students* o r a 1:5 t e a c h e r / s t u d e n t r a t i o , would r e q u i r e t w i c e t h e c o s t p e r s t u d e n t a s a t e a c h e r s e r v ­ ing t e n s t u d e n t s , o r a 1 :1 0 t e a c h e r / s t u d e n t r a t i o ) ; 2. V a r i a t i o n s 1n s a l a r i e s pa i d t o t e a c h e r s (A t e a c h e r w i t h 15 y e a r s o f e x p e r i e n c e 1s p ai d more t h a n a t e a c h e r w i t h one y e a r o f e x p e r i ­ ence* and t h e s a l a r y s c a l e s u s u a l l y d i f f e r from one s c h o o l d i s t r i c t to another); 3. S p e c i a l t r a n s p o r t a t i o n needs ( V a r i a t i o n s 1n t r a n s p o r t a t i o n c o s t s a r e a s s o c i a t e d w it h t h e u n p r e d i c t a b l e d i s t a n c e a h a n d i c a p p e d c h i l d may l i v e from t h e l o c a t i o n o f h i s / h e r s p e c i a l e d u c a t i o n program, a s w e ll a s w i t h d i f f e r i n g r e q u i r e m e n t s f o r w h e e l c h a i r l i f t s * a d d i t i o n a l s t a f f i n g t o h a n d l e b e h a v i o r a l p ro b le m s , and so o n ) ; 4. A d d i t i o n a l s e r v i c e needs o f some s t u d e n t s (Thi s I n c l u d e s sp ee ch and la ng uag e s e r v i c e s , d i a g n o s t i c e v a l u a t i o n s , s o c i a l w o r k er I n t e r v e n ­ tion, 5. b e h a v i o r management s p e c i a l i s t , and so on); and D i f f e r e n t needs f o r s u p p l e m e n t a l t e a c h i n g a i d s and m a t e r i a l s (For example, t h e r e may be need f o r B r a i l l e o r l a r g e - p r i n t books; commu­ n ic a tio n boards; h i g h - i n t e r e s t , low-vocabulary reading t e x t s ; be h av l o r - m an ag e m en t m a t e r i a l s ; and s t u d y c u b i c l e s ) . D i s t r i b u t i o n o f F i n a n c i a l Aid to C onstituent D is tr ic ts To e x p l a i n t h e d i s t r i b u t i o n o f s p e c i a l e d u c a t i o n t a x r e v e n u e s t o c o n s t i t u e n t l o c a l sch ool d i s t r i c t s a s I n t e n d e d by M ich ig an l e g i s l a t o r s , 1 t 1s n e c e s s a r y t o exam ine t h e r e l a t e d p r o v i s i o n s c o n t a i n e d 1n t h e 17 o r i g i n a l act* P u b l i c Act 18 o f 1954, and t h e n a s I n c o r p o r a t e d 1n, amended, repealed, o r added by s u c c e e d i n g a c t s . The q u e s t i o n a r i s e s a b o u t how t h e a v a i l a b l e mon ies s h o u ld be allocated to: (a) e n s u r e an e q u i t a b l e l e v e l of s u p p o r t f o r t h e d i f f e r ­ in g a d d i t i o n a l c o s t s o f e d u c a t i n g c h i l d r e n w i t h h a n d i c a p s and (b) d is trib u te the fiscal r e s o u r c e s f a i r l y among d i s t r i c t s . In a d o p t i n g P u b l i c Act 18 o f 1954, t h e l e g i s l a t u r e I n t e n d e d t h a t fu n ds r a i s e d by t h e c o u n t y s p e c i a l e d u c a t i o n t a x be d i s t r i b u t e d t o c o n s t i t u e n t l o c a l s c h o o l d i s t r i c t s 1n a manner t h a t m e e t s t h e s e c o n d i t i o n s o f e q u i t y f o r pr og ram s and d i s t r i c t s , as expressed in t h e fo llo w in g se c tio n . County b o a r d s o f e d u c a t i o n o p e r a t i n g unde r t h i s a c t s h a l l g r a n t s u b s i d i e s from s p e c i a l e d u c a t i o n fu n ds t o t h o s e c o n s t i t u e n t d i s ­ t r i c t s m a i n t a i n i n g s p e c i a l e d u c a t i o n c e n t e r s , such s u b s i d i e s t o be computed 1n t h e f o l l o w i n g manner: The p e r c a p i t a c o s t o f each t y p e o f s p e c i a l e d u c a t i o n 1n each c o n s t i t u e n t f a c i l i t y s h a l l be com­ p u te d . From t h i s amount s h a l l be d e d uc t ed t h e c u r r e n t p e r c a p i t a s t a t e s u b s i d y , I n c l u d i n g membership a s w ell a s s p e c i a l e d u c a t i o n g r a n t s , f o r each r e s p e c t i v e t y p e o f s p e c i a l e d u c a t i o n . All o r p a r t o f t h e d i f f e r e n c e r e s u l t i n g , m u l t i p l i e d by t h e number o f p u p i l s e d u c a t e d , s h a l l be r e i m b u r s a b l e by t h e coun ty board o f e d u c a t i o n : P r o v i d e d , T h a t 1f f u n d s a r e n o t s u f f i c i e n t t o make up a l l t h i s d i f f e r e n c e , a l i k e p e r c e n t o f such d i f f e r e n c e w i l l be p a i d t o a l l c o n s t i t u e n t c e n t e r s 1n t h e co u nt y. ( P u b l i c Act 18 o f 1954, S e c t i o n 14) To I n t e r p r e t t h i s s e c t i o n an u n d e r s t a n d i n g o f t h e te rm " s p e c i a l e d u c a t i o n c e n t e r " 1s n e c e s s a r y . A sp ecia l education cen ter, as defined 1n t h i s a c t , s h a l l mean a c o n s t i t u e n t sch ool d i s t r i c t which, by a c t i o n o f I t s bo ard o f e d u c a t i o n , c o n t r a c t s w i t h t h e cou n ty bo ard o f e d u c a t i o n t o p r o v i d e s p e c i a l e d u c a t i o n t o n o n - r e s i d e n t p u p i l s . ( P u b l i c Act 18 of 1954, S e c t i o n 1 Cd]) Each c o n s t i t u e n t sc ho ol d i s t r i c t ' s s p e c i a l e d u c a t i o n program was considered a special education center. C o n t r a c t s w ere made between 18 t h e ISD's bo ar d o f e d u c a t i o n and each c o n s t i t u e n t sc h o o l d i s t r i c t ' s board o f e d u c a t i o n , v e r i f y i n g an a g r e e m e n t t o a c c e p t n o n r e s i d e n t s t u ­ d e n t s 1n t h e i r s p e c i a l e d u c a t i o n programs. With eve ry s p e c i a l e d u c a t i o n program d e s i g n a t e d a s p e c i a l e d u c a t i o n c e n t e r , a l l l o c a l d i s t r i c t s p e c i a l e d u c a t i o n pr o gr am s w ere e l i g i b l e f o r r e i m b u r s e m e n t from t h e s p e c i a l e d u c a t i o n m l l l a g e fund (Mange, 1985). F o l l o w i n g t h e p r o v i s i o n s o f P u b l i c Act 18 o f 1954, S e c t i o n 14, each c o n s t i t u e n t d i s t r i c t was r e q u i r e d t o compute t h e t o t a l p e r s t u d e n t c o s t by t y p e o f program ( c e n t e r ) . From t h i s amount was s u b t r a c t e d t h e p e r s t u d e n t membership a l l o w a n c e from t h e s t a t e , as w e l l a s t h e a v e r a g e pe r s t u d e n t s h a r e of any o t h e r s t a t e monies ( c u r r e n t l y r e f e r r e d t o as categorical aid) received f o r th e stu d en t's special e d u c a t i o n program. The r e s u l t i n g d i f f e r e n c e was t h e p e r s t u d e n t a d d i t i o n a l c o s t t o t h e l o c a l d i s t r i c t t o p r o v i d e t h e s p e c i a l e d u c a t i o n program. Th is p e r s t u d e n t a d d i t i o n a l c o s t was t h e n m u l t i p l i e d by t h e number o f h a n d i ­ capped c h i l d r e n s e r v e d 1n t h e program. The t o t a l was t h e amount o f r e i m b u r s e m e n t t h e l o c a l d i s t r i c t c o u l d c l a i m from ISD s p e c i a l e d u c a t i o n t a x revenues. Thus, t h e r e i m b u r s e m e n t c l a i m e q u a l e d t h e t o t a l e x p e n s e s o f t h e pr ogram, minus t h e t o t a l r e c e i p t s (membership and c a t e g o r i c a l a i d ) r e c e i v e d f o r t h e program. An ex am ple f o l l o w s t o I l l u s t r a t e how two l o c a l s c h o o l d i s t r i c t s , D i s t r i c t X and D i s t r i c t Y, would compute t h e amount o f t h e i r r e i m b u r s e m e n t from t h e ISD s p e c i a l e d u c a t i o n m l l l a g e fund f o r o p e r a t i n g a s p e c i a l e d u c a t i o n program. c o n s t i t u e n t s o f t h e same ISD. Both d i s t r i c t s a r e 19 District Z 1 T o t a l Co st o f P r o g r a m . . . . . ....................................................... $20,000 $24,000 Ge neral Membership Allow anc e, p e r s t u d e n t * ................. Number o f S t u d e n t s 1n P r o g r a m . . . . . .................................... T o t a l Membership R e c e i p t s Rece ived 1,100 x8 8, 8 0 0 1, 00 0 x6 6, 0 0 0 T o t a l S t a t e S ub sid y f o r Program........................................... ( C a t e g o r i c a l A id ) 2 1, 2 00 4, 2 0 0 I l l u s t r a t i o n o f C o m p u t a ti o n a l P r o c e d u r e : D istrict S h o r t Terms Pescrl ptftT X I Cost T ot al C o s t o f Program $20,000 $24,000 -Membership Minus T o t a l Membership Rece ived -8,800 -6,000 - C a t e g o r i c a l Aid Minus T o t a l S p e c i a l E d u c a t i o n -1,200 -4,200 ____________________________S ubs idy _____________________________________________ =ISD Claim Eq u al s Amount R ei m b u r s ab le $10,000 $13,800 from ISD T h e r e f o r e , t h e am ou nts r e i m b u r s a b l e from t h e ISD s p e c i a l e d u c a t i o n m l l l a g e fund t o D i s t r i c t X and D i s t r i c t Y f o r t h e i r s p e c i a l e d u c a t i o n pr o gr am s ( t h e a d d i t i o n a l c o s t t o t h e l o c a l sch ool d i s t r i c t f o r p r o v i d ­ in g t h e s p e c i a l e d u c a t i o n program) w er e a s f o l l o w s : D i s t r i c t X was t o be r e i m b u r s e d $10,000, and D i s t r i c t Y was t o be r e i m b u r s e d $13,800. ^General membership a l l o w a n c e , p e r s t u d e n t , from t h e s t a t e v a r i e d b e c a u s e d i f f e r e n t amounts w e re r a i s e d t h r o u g h v a r y i n g l o c a l d i s t r i c t property ta x rate s. 2 S t a t e s p e c i a l e d u c a t i o n s u b s i d i e s v a r i e d b e c a u s e t h e amount give n was d e t e r m i n e d by a p e r c e n t a g e payment o f a s p e c i a l e d u c a t i o n t e a c h e r ' s s a l a r y up t o a maximum amount. 20 When t h e t o t a l amount of t h e c o n s t i t u e n t sc h o o l d i s t r i c t c l a i m s exceeded t h e amount a v a i l a b l e 1n t h e s p e c i a l e d u c a t i o n fund, a 1 I k e p e r c e n t was t o be pa i d on t h e c l a i m s of a l l t h e c o n s t i t u e n t d i s t r i c t s . The p r o v i s i o n s c o n t a i n e d w i t h i n S e c t i o n 14 of P u b l i c Act 18 o f 1954 d e t a i l e d a s p e c i f i c s e t o f p r o c e d u r e s f o r a c o n s t i t u e n t sc h oo l d i s t r i c t t o f o l l o w 1n c o m pu ti n g t h e a d d i t i o n a l c o s t a c t u a l l y r e i m b u r s e d from s p e c i a l e d u c a t i o n t a x r e v e n u e s. F o l l o w i n g 1s an I l l u s t r a t i o n of t h e p r o c e d u r e f o r d e t e r m i n i n g t h e H k e - p e r c e n t o f payment. Data needed: T o t a l a d d i t i o n a l c o s t c l a i m e d by c o n s t i t u e n t d i s t r i c t s : $500,000 T o t a l amount a v a i l a b l e 1n t h e s p e c i a l e d u c a t i o n fund : $300,000 Procedure: 1. D iv id e t h e amount a v a i l a b l e by t h e amount o f t h e c l a i m t o compute t h e H k e - p e r c e n t o f payment. $300,000 2. d i v i d e d by In t h i s c a s e , $500,000 e q u a l s 60%. To d e t e r m i n e t h e amount o f payment ( a c t u a l r e i m b u r s e m e n t ) t o t h e c o n s t i t u e n t d i s t r i c t s from t h e s p e c i a l e d u c a t i o n fund, m u l t i p l y t h e amount of c l a i m by t h e computed H k e - p e r c e n t a s f o l l o w s : Actual Re imbursement D istrict Amount o f Claim Like P e r c e n t X $10,000 (x) 60% (=) $6,000 Y $13,800 (x) 60% (=) $8,280 M u l t i p l y i n g by a H k e - p e r c e n t was r e p e a t e d f o r a l l c o n s t i t u e n t d i s t r i c t r e i m b u r s e m e n t c l a i m s on t h e coun ty s p e c i a l e d u c a t i o n fund t o 21 d e t e r m i n e t h e a c t u a l r e im b u r s e m e n t . T h i s s t a t u t o r y s ys te m I n c o r p o r a t e d w i t h i n t h e S p e c i a l E d u c a t i o n Act r e c o g n i z e d t h e need t o d i s t r i b u t e t h e f i s c a l burd en o f e d u c a t i n g h a n d i ca pp ed c h i l d r e n e q u i t a b l y among con­ s t i t u e n t school d istricts. To su mmarize, t h e p r o v i s i o n s c o n t a i n e d 1n S e c t i o n 14 o f P u b l i c Act 18 o f 1954 e x p l i c i t l y r e q u i r e d a p r o c e s s f o r d i s t r i b u t i n g c o u n t y s p e ­ c i a l education ta x revenues t o c o n s t i t u e n t d i s t r i c t s . Th is method both r e c o g n i z e d and mandated e q u i t a b l e s u p p o r t o f t h e a d d i t i o n a l c o s t I n c u r r e d by l o c a l d i s t r i c t s 1n p r o v i d i n g s p e c i a l e d u c a t i o n p r o g r a m s and s e r v i c e s by s p r e a d i n g any n e t c o s t burden p r o p o r t i o n a t e l y among con­ s t i t u e n t school d i s t r i c t s and pr ograms. The I d e n t i c a l l a n gu ag e f o r t h e d i s t r i b u t i o n of s p e c i a l e d u c a t i o n m l l l a g e f u n d s was I n c o r p o r a t e d 1n P u b l i c Act 269 o f 1955, t h e School Code o f 1955 ( S e c t i o n 322). P u b l i c Act 190 o f 1962, which c r e a t e d ISDs from t h e f o r m e r l y t i t l e d c o un ty scho ol d i s t r i c t s , made o n ly t h e word ing ch a n g e s n e c e s s a r y 1n t h i s s e c t i o n t o accommodate t h e s h i f t from coun ty sc ho ol d i s t r i c t s t o ISDs. In t h e p r o c e s s , t h e p r e v i o u s s e c t i o n number was r e p e a l e d ( P u b l i c Act 269, S e c t i o n 32 2) , and a new s e c t i o n number was added ( S e c t i o n 319a), which c o n t a i n e d t h e I d e n t i c a l c o n d i t i o n s and p r o c e d u r e s f o r d i s t r i b u t i n g s p e c i a l e d u c a t i o n m l l l a g e f u n d s t o c o n s t i t u e n t s ch o ol d1strlcts. P u b l i c Act 198 of 1971, p o p u l a r l y r e f e r r e d t o a s M i c h i g a n ' s Manda­ t o r y S p e c i a l E d u c a ti o n Act, r e p e a l e d t h e s e c t i o n p e r t a i n i n g t o t h e d i s t r i b u t i o n o f s p e c i a l e d u c a t i o n m i l l a g e fu nd s t o c o n s t i t u e n t d i s ­ t r i c t s ( P u b l i c Act 269 o f 1955, S e c t i o n 31 9a, a s amended), and added a 22 new s e c t i o n (317a)> which r e q u i r e d t h a t t h e S t a t e Board o f E d uc a ti o n d e v el op r u l e s g o v e r n in g t h e d i s t r i b u t i o n of s p e c i a l e d u c a t i o n m l l l a g e fu nd s. This s e c tio n reads as fo llow s: Boards coming under t h e p r o v i s i o n s o f s e c t i o n 307a t o 324a s h a l l expend fun ds r e c e i v e d u n d e r s e c t i o n 314a f o r s p e c i a l e d u c a t i o n p u r p o s e s 1n a c c o r d a n c e w i t h r u l e s pr o m u l g a te d by t h e s t a t e board o f e d u c a t i o n . ( P u b l i c Act 198 of 1971, S e c t i o n 317a) S e c t i o n s 307a t h r o u g h 324 a p e r t a i n e d t o t h e a d o p t i o n of a s p e c i a l e d u c a t i o n m l l l a g e and t h e accompanying p r o v i s i o n s . S e c t i o n 314a r e f e r r e d s p e c i f i c a l l y t o th e c o l l e c t i o n of a s p e c ia l education m llla g e tax. P u b l i c Act 451 o f 1976, t i t l e d t h e School Code o f 1976, was e s t a b ­ l i s h e d " t o r e v i s e , c o n s o l i d a t e , and c l a s s i f y t h e la w s r e l a t i n g t o e l e m e n t a r y and s e c o n d a r y e d u c a t i o n " ( P u b l i c Act 451 o f 1976, e n t i t l e ­ m e n t , 1n p a r t ) . T h i s l e g i s l a t i o n and o t h e r a c t s o f t h e same t y p e a r e o f t e n re fe rre d t o as re-cod1f1cation acts. T h e i r p u r p o s e 1s t o merge a l l r e l a t e d a c t s by a r r a n g i n g them s y s t e m a t i c a l l y under one l e g i s l a t i o n and nu mb eri ng scheme. T h i s may r e q u i r e some r e w r i t i n g t o accommodate t h e In flu en c e of d i f f e r e n t a c ts . However, t h e goal o f a r e - c o d 1 f 1 c a t 1 o n a c t 1s n o t t o change t h e I n t e n t i o n o f any l e g i s l a t i o n , but to put the law t o g e t h e r 1n one p l a c e . For p u r p o s e s o f r e - c o d 1 f l c a t l o n , P u b l i c Act 451 r e p e a l e d t h e p r e v i o u s s e c t i o n ( P u b l i c Act 198 o f 1971, S e c t i o n 317a) and i n c o r p o ­ r a t e d e s s e n t i a l l y t h e same l a n gu ag e 1n t h e f o l l o w i n g s e c t i o n : 23 An I n t e r m e d i a t e school bo ard o p e r a t i n g u n d e r s e c t i o n s 1722 t o 1729 s h a l l expend fu nd s r e c e i v e d unde r s e c t i o n 1728 f o r s p e c i a l e d uc a­ t i o n p u r p o s e s 1n a c c o r d a n c e w i t h r u l e s p r o m u l g a t e d by t h e s t a t e b o a r d . ( P u b l i c Act 451 o f 1976, S e c t i o n 1729 [ 1 ] ) S e c t i o n s 1722 th ro u gh 1729, r e f e r r e d t o above» c o n t a i n t h e p r o v i ­ sions concerning th e s p e c ia l education m llla g e. S e c t i o n 1728 s p e c i f i ­ c a l l y r e f e r s t o c o l l e c t i o n of t h e sp ecia l education m llla g e ta x (Public Act 451 o f 1976, S e c t i o n s 1722-1729). With t h e p a s s a g e of P u b l i c Act 198 o f 1971, a l e g a l problem began t o deve lo p c o n c e r n i n g t h e d i s t r i b u t i o n o f s p e c i a l e d u c a t i o n m l l l a g e funds t o c o n s t i t u e n t sc h oo l d i s t r i c t s . P u b l i c Act 198 o f 1971 repealed th e p ro v is io n s governing th e d i s t r i b u t i o n of sp e c ia l ed ucation m l l l a g e fu nd s t o c o n s t i t u e n t sc ho ol d i s t r i c t s ( P u b l i c Act 198 o f 1971, S e c t i o n 2, r e p e a l e d S e c t i o n 319a o f P u b l i c Act 269 o f 1955, as amended). A p r o v i s i o n was added, s t i p u l a t i n g t h a t fun ds would be r e i m b u r s e d 1n a c c o r d a n c e w i t h r u l e s p r o m u l g a te d by t h e S t a t e Board of E d u c a ti o n ( P u b l i c Act 198 of 1971, S e c t i o n 317a). T h i s p r o v i s i o n was I n c l u d e d b e c a u s e many v a r i a t i o n s e x i s t e d 1n ISD p r a c t i c e s f o r d i s t r i b ­ u t i n g s p e c i a l e d u c a t i o n m l l l a g e funds. The d r a f t e r s o f P u b l i c Law 198 o f 1971 b e l i e v e d t h a t by r e q u i r i n g t h e S t a t e Board o f E d u c a t i o n t o p r o m u l g a t e r u l e s r e g u l a t i n g t h e use o f ISD s p e c i a l e d u c a t i o n m l l l a g e fu n d s , t h e s e v a r i a t i o n s would be p r o p e r l y a d d r e s s e d (Mange, 1985). The same la n g u a g e was m a i n t a i n e d and I n c o r p o r a t e d w i t h i n t h e School Code o f 1976 ( P u b l i c Act 451 o f 1976, S e c t i o n 1729 C l ] ) , c u r r e n t l y 1n e f f e c t . which 1s The r e s u l t i n g l e g a l pro ble m was t h a t t h e S t a t e Board o f E d u c a ti o n d id n o t p r o m u l g a t e r u l e s g o v e r n i n g t h e use o f s p e ­ c i a l e d u c a t i o n m l l l a g e fu n d s u n t i l August 1980. P u b l i c Act 198 o f 1971 24 to o k e f f e c t 1n J u l y 1972. Thus, f o r more t h a n e i g h t y e a r s t h e r e were no p r o v i s i o n s g o v e r n i n g t h e d i s t r i b u t i o n o f s p e c i a l e d u c a t i o n m l l l a g e fu nds t o c o n s t i t u e n t d i s t r i c t s . A c h r o n o l o g i c a l n a r r a t i v e summary o f t h e l e g a l p r o v i s i o n s a f f e c t ­ in g t h e a d o p t i o n o f a s p e c i a l e d u c a t i o n m i l l a g e le v y and t h e l e g a l p r o v i s i o n s g o v e r n i n g t h e d i s t r i b u t i o n o f such fu n ds t o c o n s t i t u e n t sc h o o l d i s t r i c t s a r e p r e s e n t e d 1n T a b l e 1. a summary of t h e s e l e g a l A more d e t a i l e d l i s t i n g and p r o v i s i o n s a r e p r e s e n t e d 1n Appendix C. V a r i a t i o n s 1n I n t e r m e d i a t e School D i s t r i c t P r a c t i c e s f o r D i s t r i b u t i n g S p e c i a l E d u c a ti o n M i l l a g e Funds P u b l i c Act 18 o f 1954 c o n t a i n e d p r o v i s i o n s t h a t governed t h e d i s t r i b u t i o n of s p e c ia l e d u c a tio n m l lla g e funds t o lo c a l c o n s t i t u e n t sc ho ol d i s t r i c t s . Even th ou gh t h i s l a n g u a g e was 1n f o r c e u n t i l 1972, many v a r i a t i o n s e x i s t e d and c o n t i n u e t o e x i s t among ISD p r a c t i c e s f o r d i s t r i b u t i n g t h e s e f u n d s t o t h e i r l o c a l c o n s t i t u e n t sch ool d i s t r i c t s . V a r i a t i o n s o c c u r r e d p r i m a r i l y f o r t h e f o l l o w i n g tw o broad and p e r h a p s overlapping reasons: 1. ISDs I n t e r p r e t e d t h e t a x - d 1 s t r 1 b u t 1 o n l a n g u a g e d i f f e r e n t l y (Michigan D ep ar tm en t o f E d u c a t i o n , S p e c i a l E d u c a t i o n A d m i n i s t r a t i v e Manual, Volume I I , 2. F in a n c e , 1985, p. 27); and " T h is s e c t i o n of t h e law was n o t f o l l o w e d by many I n t e r m e d i a t e school d i s t r i c t s " ( S p e c i a l E d u c a t i o n Task F o rce R ep o rt , July 1977, p. 8 4 ) . Both of t h e s e r e a s o n s f o r v a r i a t i o n s 1n ISD p r a c t i c e s f o r d i s t r i b u t i n g s p e c i a l e d u c a t i o n m l l l a g e fu n d s a r e d i s c u s s e d 1n t h e f o l l o w i n g pages. 25 T a b l e 1.— C h r o n o l o g i c a l summary o f t h e l e g a l p r o v i s i o n s f o r a d o p t i n g a s p e c i a l e d u c a t i o n m l l l a g e and t h e l e g a l p r o v i s i o n s g o v e r n i n g d i s t r i b u t i o n o f such funds t o c o n s t i t u e n t sc ho ol d i s t r i c t s . So urce of Legal P r o v i s i o n s S p e c i a l E d u c a t i o n M il l age Adoption M ich ig an P u b l i c Act 18 o f 1954 Provided a u t h o r i z a t io n f o r v o t e r s of county sch o ol d i s t r i c t s with p opulations o v e r 3 90, 00 0 t o a d o p t a s p e c i a l e d u c a t i o n m111 age 1 evy. To amend o r remove a s p e ­ c ia l education m lllage l e v y , once a d o p t e d , re q u ire d an o th er vote of the electo rs. Michigan P u b l i c Act 269 o f 1955 P opulation l i m i t s allowing fo r adoption of a s p e c ia l m l l l a g e were lower ed from 390 ,0 00 o r o v e r t o 180,000 or over. D istribution R ei m b ur s em en t t o a l l c o n s t i t u e n t sc h o o l d i s t r i c t s was based on a H k e - p e r c e n t payment f o r t h e p e r cap ita additional c o s ts of providing s p ecial education programs and s e r v ­ ices. No ch an g e s I n c l u d e d l a n gu ag e t h a t a l lo w ed two o r more coun­ t i e s o f l e s s t h a n 15,000 p e o p l e each t o j o i n , w it h t h e “combined d i s t r i c t ” e l i g i b l e t o adopt th e special education m lllage levy. Michigan P u b l i c Act 4 o f t h e F1 r s t Extra Session o f 1955 Eliminated t h e population requirements fo r th e adoption of a special e duca tion m llla g e levy. No c h a n g e s Michigan P u b l i c Act 190 o f 1962 County school d i s t r i c t s were renamed I n t e r m e d i a t e sch ool d i s t r i c t s . No c h ang es 1n r e q u i r e m e n t s f o r adoption of a sp ecial educa tion m llla g e levy. No c h a n g e s 1n t h e method o f d i s t r i b u t ­ in g s p e c i a l e d u c a t i o n m l l l a g e f u n d s t o con­ s t i t u e n t sch ool d i s ­ tricts. 26 T a b l e 1 . — C on ti n ue d. S our ce of Legal P r o v i s i o n s Special Education M lllage Adoption D istribution Michigan P u b l i c Act 191 o f 1963 Added la n g u a g e t h a t al lo w ed f o r i n c r e a s i n g a special education m illa g e l e v y by a v o t e of t h e d i s t r i c t ’s electors. No ch ang es Michigan P u b l i c Act 198 o f 1971 No ch an g e s R ep ea le d l a n g u a g e a b o u t t h e method t o be used 1n d i s t r i b u t ­ ing s p e c i a l e d u c a t i o n m l l l a g e fu n ds t o con­ stitu en t d istric ts and added t h e r e q u i r e ­ ment t h a t t h e S t a t e Board o f E d u c a ti o n p r o m u l g a te r u l e s gov­ erning the d is tr i b u ­ tio n of special education m lllage funds. Michigan P u b l i c Act 451 o f 1976 Language c o n c e r n i n g removing an a d op t ed sp ecia l education m i l l age le v y was e l i m i n a t e d . No ch ang es Michigan S p e c i a l E d u c a t i o n Ru le s R e v i s i o n o f 1980 No ch an ge s Added two r u l e s t o g ov ern t h e d i s t r i b u ­ t i o n and us e of s p e ­ cia l education m l l l a g e fu n d s . V a r i a t i o n s Due t o D i f f e r e n t I n t e r p r e t a t i o n s In g e n e r a l , t h e l e g a l p r o v i s i o n s o f P u b l i c Act 18 o f 1954 s t i p u ­ l a t e d a s y st em of ISD s p e c i a l e d u c a t i o n m l l l a g e fund r e i m b u r s e m e n t t o c o n s t i t u e n t l o c a l sc ho ol d i s t r i c t s based on program c o s t s minus 27 receipts. For t h e mo st p a r t* v a r i a t i o n s o c c u r r e d 1n ISDs’ p r a c t i c e s b e c a u s e o f d i f f e r e n t I n t e r p r e t a t i o n s o f (a) which program c o s t s were a l l o w a b l e and (b) how r e c e i p t s w e re c a l c u l a t e d (Mange# 1980). A dis­ c u s s i o n o f each o f t h e s e t o p i c s f o l l o w s . A l l o w a b l e Program C o s t s The a d d e d - c o s t s y st e m o f s t a t e r e i m b u r s e m e n t f o r s p e c i a l e d u c a t i o n p ro gr am s and s e r v i c e s was a d o p t e d 1n t h e S t a t e Aid Act f o r t h e 1975-76 s c h o o l y e a r ( P u b l i c Act 261 o f 1975). Th is a d d e d - c o s t sy st em r e s u l t e d In t h e s p e c i f i c a t i o n o f a l l o w a b l e c o s t s f o r s p e c i a l e d u c a t i o n programs and s e r v i c e s # DS 4096. which w e re t o be r e p o r t e d on a s p e c i f i c s t a t e form# On t h i s form a l l c o s t s w ere t o be r e p o r t e d and l i s t e d a c c o r d i n g t o c a t e g o r i e s and d e f i n i t i o n s . (The c a t e g o r i e s and d e f i n i t i o n s f o r t h e 1984-85 s c h o o l y e a r a r e I n c l u d e d 1n Appendix D.) B e f o r e t h a t time# 1t was n o t n e c e s s a r y f o r t h e s t a t e t o c o l l e c t f u l l c o s t d a t a ( S p e c ia l E d u c a ti o n Task F o r c e Report# J u l y 1977). As a r e s u l t # ISDs were f o r c e d t o d e v e l o p t h e i r own c a t e g o r i e s and d e f i n i t i o n s o f wh at c o n s t i t u t e d a l l o w a b l e program c o s t s (Mange# 1980). Thi s l a c k o f s t a n d a r d i z a t i o n and a c c o u n t a b i l i t y l e d t o many d i f f e r e n t I n t e r p r e t a t i o n s and v a r i a t i o n s among ISDs. Some o f t h e s e d i f f e r e n c e s were no te d 1n t h e 1977 r e p o r t o f t h e Ad Hoc Task Force on S p e c i a l E d u c a ti o n 1n Michigan: Some [IS Ds ] p e r m i t t e d a l l o w a n c e s f o r b u i l d i n g o p e r a t i o n and mainte na nce # s e c r e t a r i a l s e r v i c e s # r e n t a l o f f a c i l i t i e s # p er s o nn el t r a v e l # c o n f e r e n c e e x p e n s e s . Even when allowed# g r e a t v a r i a t i o n s e x i s t e d 1n t h e maximum l i m i t s and methods o f c a l c u l a t i o n f o r each I te m . ( S p e c i a l E d u c a t i o n Task Fo rc e Report# J u l y 1 9 7 7 , p. 86) Even though t h e s t a t e a d d e d - c o s t system p r o v id e d a c o n s i s t e n t l i s t i n g of c a t e g o r i e s and d e f i n i t i o n s ( s t a r t i n g w i t h t h e 1975-76 sch ool 28 y e a r ) o f what c o n s t i t u t e d a l l o w a b l e program c o s t s , many ISDs d i d n o t us e them. "Numerous ISD's have c o n t i n u e d w i t h t h e i r own d e f i n i t i o n s and c a t e g o r i e s o f a l l o w a b l e c o s t s t o be used when c a l c u l a t i n g ISD r e i m b u r s e m e n t t o t h e i r c o n s t i t u e n t d i s t r i c t s " ( S p e c i a l E d u c a ti o n Task Forc e Report* Special J u l y 1977, p. 86). Ed u ca ti o n Rule 340.1811 (2), a d o p t e d In August 1980, r e q u i r e s ISDs t o ba s e a l l o w a b l e c o s t s s o l e l y on t h o s e e x p e n s e s t h a t a r e r e p o r t e d and a l l o w e d by t h e Michigan D e p a r tm e n t o f E d uc a tio n . However, t h e r e were s t i l l r e p o r t s t h a t ISDs were c o n t i n u i n g t o use t h e i r own c a t e g o r i e s and d e f i n i t i o n s f o r d e t e r m i n i n g a l l o w a b l e c o s t s (Mange, 19 8 5 ) . C a lcu latin g Receipts The ma jor I n t e r p r e t i v e problem in c a l c u l a t i n g r e c e i p t s was what amount was c o n s i d e r e d t o be t h e p e r s t u d e n t memb ersh ip r e c e i v e d from the state. The p r o v i s i o n c o n c e r n i n g t h e d e d u c t i o n o f s t a t e membership moni es from a l l o w a b l e s p e c i a l e d u c a t i o n program c o s t s 1n P u b l i c Act 18 o f 1954 r e a d s a s f o l l o w s : "From t h i s amount [ a l l o w e d program c o s t s ] s h a l l be de du ct ed t h e c u r r e n t p e r c a p i t a s t a t e s u b s i d y , I n c l u d i n g membership" ( P u b l i c Act 18 of 1954, S e c t i o n 14, 1n p a r t ) . The ambi­ g u i t y o f t h i s l a n gu ag e " s t i p u l a t e d I n d e p e n d e n t d e c i s i o n s by ISD's a s t o t h e r e c e i p t s r e c e i v e d by l o c a l d i s t r i c t s from t h e s t a t e " ( S p e c ia l E d u c a t i o n Task Fo rc e R e p o r t , J u l y 1977, p. 8 6 ) . Although some ch ang es w ere made In t h e f o r m u l a s f o r s t a t e member­ s h i p a i d (Thomas, 1968) b e f o r e t h e s t a t e a d o p t e d t h e p o w e r - e q u a l 1 z a t 1 o n 29 membership s u p p o r t s y st e m 1n 1973 ( P u b l i c Act 101 o f 1973)# s t a t e membership s u p p o r t g e n e r a l l y c o n s i s t e d o f "a f o u n d a t i o n l e v e l o f so many d o l l a r s p e r p u p i l ( g r o s s a l l o w a n c e ) minus t h e l o c a l s h a r e 1n t e r m s o f a s p e c i f i e d p r o p e r t y t a x le v y ( d e d u c t i b l e m l l l a g e ) ” (Caesar# McKerr# & Ph elps# 1973# p. 1 1 ) . Under t h i s f o u n d a t i o n - l e v e l s u p p o r t system# s t a t e mem bersh ip was a gro ss allow ance per student# with t h e s t a t e g u aran teein g a c e r t a i n d o l l a r amount o f s u p p o r t ( f o u n d a ti o n ) # minus a d e d u c t i b l e amount ( te r m e d t h e depended localshare or local per student tax receipts)# on t h e p e r p u p il p r o p e r t y wealth# s t a t e which equalized v a lu a tio n (SEV)» o f t h e l o c a l s c h o o l d i s t r i c t (Roe# G1dd1s» 4 Nielson# 1963). T h i s s yst em I s I l l u s t r a t e d i n t h e f o l l o w i n g s i m p l i f i e d example. STATE FOUNDATION-LEVEL SUPPORT SYSTEM D istrict A D istrict B (High SEV) (Med. SEV) 1. F o u n d a ti o n Level# p e r s t u d e n t # o r " g r o s s membership a l l o w a n c e " 2. 3. D istrict C (Low SEV) $1#000 $1#000 $1#000 Minus Local p e r s t u d e n t t a x r e c e i p t s ( l o c a l s h a r e of member­ ship) 900 500 100 Eq u al s t h e S t a t e Aid Payment# per s tu d e n t ( s t a t e share of membership) 100 500 900 I t 1s I m p o r t a n t t o n o t e t h a t t h e s t a t e g r o s s mem bers hip a l l o w a n c e co m p ris ed a s t a t e s h a r e and a l o c a l s h a r e ( o r c o n t r i b u t i o n ) . The problem w i t h I n t e r p r e t i n g t h e la n g u a g e o f P u b l i c Act 18 o f 1954 30 c o n c e r n e d t h e d e d u c t i o n o f s t a t e membership moni es from s p e c i a l educa­ t i o n program c o s t s * and w h at was t o be c o n s i d e r e d t h e s t a t e membership amount. Some have ar g u ed f o r o r s i m p l y a c c e p t e d t h e p o s i t i o n t h a t t h e d i s t r i c t r e c e i v e s o nl y t h a t p o r t i o n o f membership money a c t u a l l y p a i d from s t a t e fu nd s and t h a t t h e l o c a l t a x y i e l d 1s s t r i c t l y l o c a l and s h o u ld n o t be c o u nt ed a s a r e c e i p t . ( S p e c i a l E d u c a t i o n Task F o rce Report* J u l y 1977, p. 86) Such an I n t e r p r e t a t i o n rew ar de d t h e h1gh-SEV d i s t r i c t s and pr od uce d c o n s i d e r a b l e I n e q u i t y 1n t h e d i s t r i b u t i o n o f a v a i l a b l e s p e c i a l e d u c a ­ t i o n m l l l a g e fu n ds . T h i s 1s I l l u s t r a t e d f o r D i s t r i c t s A, B, and C, each o f which o p e r a t e s a s p e c i a l e d u c a t i o n program w i t h t h e a l l o w a b l e program c o s t s * number o f s t u d e n t s * and c a t e g o r i c a l a i d a l l b e i n g e q u a l . D istrict A (High SEV) T o t a l Allowed Program C o s t s G ro ss Membership Allowance Local S h ar e ( o r C o n t r i b u t i o n ) S t a t e Share Number o f S t u d e n t s S t a t e C a t e g o r i c a l Aid PIstr i ct £ Dis t r ict £ (Med. SEV) (Low SEV) $20,000 $20,000 $2 0,000 I t 000 900 100 I t 000 500 500 I t 000 100 900 10 10 10 $ 8*100 $ 8*100 $ 8, 1 0 0 31 STATE SHARE OF MEMBERSHIP ALLOWANCE USED IN CALCULATING RECEIPTS Platelet A P.1strict J3 Platrlct £ (High SEV) 1. T o t a l Allowed Program C o s t s 2 . Minus R e c e i p t s * 3 . Equals t h e Amount R e i m b u r s a b le from t h e S p e c i a l E d u c a ti o n M l l l a g e Fund (Med. SEV) (Low SEV) $20,000 $20,000 $20,000 -9,100 -13,100 _t 17,100 $10,900 $ 6,900 $ 2,900 ^ C a l c u l a t i o n of R e c e i p t s : Formula = ( s t a t e s h a r e of " g r o s s memb ership a l l o w a n c e " t i m e s t h e number of s t u d e n t s ) p l u s c a t e g o r i c a l a i d D istrict A= ( 100 x 10) + 8 , 1 0 0 = 1 , 0 0 0 + 8 , 1 0 0 = 9 , 1 0 0 D istrict B= (5 0 0 x 10) + 8 , 1 0 0 = 5 , 0 0 0 + 8 , 1 0 0 = 1 3 , 1 0 0 D i s t r i c t C = (900 x 10) + 8,100 = 9,000 + 8,100 = 17,100 As I l l u s t r a t e d , a l a r g e r amount o f t h e a v a i l a b l e s p e c i a l e d u c a t i o n m l l l a g e funds would be r e i m b u r s e d t o t h e h i g h e r SEV d i s t r i c t s 1f o nl y t h e s t a t e s h a r e o f t h e g r o s s mem bers hip a l l o w a n c e was used 1n t h e calculation. C o n s i d e r a b l e I n e q u i t y In t h e d i s t r i b u t i o n o f s p e c i a l e d u c a t i o n m l l l a g e fu nd s t o l o c a l c o n s t i t u e n t d i s t r i c t s would r e s u l t . The l e g i s l a t u r e I n t e n d e d t o have t h e s t a t e g r o s s memb ership a l l o w a n c e s u b t r a c t e d from t h e a l l o w a b l e program c o s t s , r a t h e r t h a n s u p p l e m e n t i n g t h e high v a l u a t 1 o n - d 1 s t r 1 c t s w i t h a d d i t i o n a l s p e c i a l e d u c a t i o n m l l l a g e fund s (Mange, 1985). The s t a t e g r o s s me mbe rs hip a l l o w a n c e 1s used 1n t h e I l l u s t r a t i o n below f o r D i s t r i c t s A, B, and C t o d e m o n s t r a t e t h e l e g i s l a t i v e I n t e n t i o n o f e q u i t y 1n t h e d i s t r i b u t i o n o f s p e c i a l e d uc a­ t i o n m i l l a g e funds t o l o c a l c o n s t i t u e n t sch ool d i s t r i c t s . 32 GROSS MEMBERSHIP ALLOWANCE USED IN CALCULATING RECEIPTS D istrict A D istrict B (High SEV) (Med. SEV) D istrict C (Low SEV) 1. T o t a l Allowed Program C o s t s $2 0,000 $20,000 $20,000 2. Minus R e c e i p t s * -18.100 -18.100 -18.100 3. Equa ls t h e Amount Re i m b u r s ab le from t h e S p e c i a l E d u c a ti o n M i l l a g e Fund $ 1.900 $ 1.900 $ 1.900 ♦C alculation of Receipts: Formula = S t a t e g r o s s membership a l l o w a n c e t i m e s t h e number of stu d e n ts, plus c a te g o ric a l aid D i s t r i c t A, B & C = ( 1 . 0 0 0 x 10) + 8 , 1 0 0 = 1 0 , 0 0 0 + 8 , 1 0 0 = 1 8 , 1 0 0 I f l o c a l c o n s t i t u e n t s ch oo l d i s t r i c t s had t h e same program c o s t s and t h e same r e c e i p t s , t h e l e g i s l a t u r e I n t e n d e d un d er t h e p r o v i s i o n s of P u b l i c Act 18 o f 1954 t h a t t h e r e i m b u r s e m e n t from ISD s p e c i a l e d u c a t i o n m l l l a g e fun ds would be t h e same f o r each d i s t r i c t . When t h e s t a t e a d o p t e d t h e power e q u a l i z a t i o n membership s u p p o r t sy ste m 1n 1973 ( P u b l i c Act 101 o f 1973), a r g u m e n t s c o n t i n u e d o v e r w ha t s h o u ld be c o n s i d e r e d a s t h e s t a t e me mbe rs hip r e c e i p t s f o r each s t u d e n t e n r o l l e d In a s p e c i a l e d u c a t i o n program (Mange, 1980). Under t h e po w er -e qu al I z a t i o n mem bersh ip s u p p o r t s y s t e m , t h e s t a t e g r o s s member­ s h i p a l l o w a n c e ha s been d e f i n e d a s t h e s t a t e - d e t e r m i n e d p e r s t u d e n t and 33 p e r m i l l amount g u a r a n t e e d t o be a v a i l a b l e t o a s c h o o l d i s t r i c t f o r g e n e r a l program o p e r a t i o n . T h i s p e r s t u d e n t amount 1s a g u a r a n t e e d l e v e l o f su pp ort # w i t h t h e s t a t e making up t h e d i f f e r e n c e , 1f any, betwee n what a l o c a l sch oo l d i s t r i c t r e c e i v e d 1n p r o p e r t y t a x r e v e n u e s and t h e g u a r a n t e e d l e v e l o f s u p p o r t . The m a j o r d i f f e r e n c e between t h e p o w e r - e q u a l 1 z a t 1 o n membership s u p p o r t s y st em and t h e f o r m e r f o u n d a t i o n l e v e l membership s u p p o r t s ys te m 1s t h e c o n c e p t o f an "equ al y i e l d " f o r t h e number of m i l l s l e v i e d by a l o c a l sch ool d i s t r i c t . The t a x e f f o r t (number of m i l l s v o te d by t h e e l e c t o r s o f a l o c a l sc h o o l d i s t r i c t ) 1s supported a t s e t l e v e l s throughout t h e s t a t e , e r t y w e a l t h o f a l o c a l sc h o o l d i s t r i c t . r e g a r d l e s s o f t h e prop­ An eq u al y i e l d f o r equal t a x e f f o r t 1s a c c o m p l i s h e d by t h e s t a t e ’s g u a r a n t e e i n g a s p e c i f i c amount of f i n a n c i a l s u p p o r t f o r each s t u d e n t and f o r ea ch m i l l l e v i e d by t h e l o c a l school d i s t r i c t f o r g e n e r a l program o p e r a t i o n . The f o l l o w i n g ex am ple I l l u s t r a t e s how t h i s s y st em would work 1n t h r e e l o c a l sc h oo l d i s t r i c t s u s i n g t h e 1984-85 s t a t e a i d f o r m u l a ( P u b l i c Act 239 o f 1984) w i t h a g r o s s membership a l l o w a n c e o f $300 p e r s t u d e n t p l u s $64 f o r each m ill levied. 34 ILLUSTRATION OF THE STATE POWER-EQUALIZATION MEMBERSHIP SUPPORT SYSTEM D istrict Operational Ml11 age Per Pupil SEV Gross A11owance Revenue S ou rce State Local I&X X 35 2 0 ,0 0 0 2, 5 4 0 700 1, 8 40 Y 30 40 ,0 00 2,220 1,20 0 1, 0 20 Z 25 70,000 1, 9 0 0 1,750 150 C alculations: D istrict X Gro ss A ll o w an ce = 300 + 64 p e r m i l l = 300 + (64 x 35) = 300 + 2240 = 2540 Local Tax = P e r P u p il SEV x M ill age Ra te = 2 0 ,0 00 x .035 = 700 S t a t e S h a r e = Gr oss Allowance - Local Tax = 2540 - 700 = 1840 D istrict Y Gro ss Allowance = 300 + 64 p e r m i l l = 300 + (64 x 30) = 300 + 1920 = 2220 Local Tax = P er P u p il SEV x M U l a g e R at e = 4 0 , 0 0 0 x . 0 30 = 1, 20 0 S t a t e S h a r e = G r os s Allowance - Local Tax = 2220 - 1, 20 0 = 1 , 0 2 0 D istrict Z Gr oss Allowance = 300 + 64 p e r m i l l = 300 + (64 x 25) = 300 + 1600 = 1900 Local Tax = P er P u p il SEV x M i l l age R at e = 7 0 , 0 0 0 x .025 = 1750 S t a t e S h a r e = G r os s Allowance - Local Tax = 1900 - 1750 = 150 35 As I l l u s t r a t e d , t h e p o w e r - e q u a l 1 z a t 1 o n membership s u p p o r t s ys te m 1s b as ed on an e q u a l - y l e l d c o n c e p t f o r each s t u d e n t and f o r each m i l l l e v i e d 1n t h e l o c a l school d i s t r i c t , w i t h t h e s t a t e pay in g t h e d i f f e r ­ e n c e , 1f any, betwe en wh at h as been r a i s e d a t t h e v o t e d o p e r a t i o n a l m l l l a g e l e v e l and t h e g u a r a n t e e d amount. The h i g h e r t h e v o t e d o p e r a ­ t i o n a l m l l l a g e , t h e l a r g e r t h e s t a t e g r o s s membership a l l o w a n c e . T her e c o n t i n u e s t o be a l o c a l s h a r e ( c o n t r i b u t i o n ) and a s t a t e s h a r e o f t h e g r o s s memb ersh ip a l l o w a n c e . The s t a t e s h a r e would be z e r o 1f t h e p e r s t u d e n t SEV t i m e s t h e m l l l a g e r a t e ( o r t h e l o c a l t a x re v e n u e , p e r s t u d e n t ) e x c e e d s t h e g r o s s membership a l lo w a n c e . I f only t h e s t a t e s h a r e 1s c o n s i d e r e d t o be t h e membership r e c e i p t s r e c e i v e d from t h e s t a t e 1n c a l c u l a t i n g t h e ISD s p e c i a l ed uca ­ t i o n m l l l a g e r e i m b u r s e m e n t t o l o c a l sch ool d i s t r i c t s , h 1 g h - v a l u a t l o n d i s t r i c t s would b e n e f i t by r e c e i v i n g more s p e c i a l e d u c a t i o n m l l l a g e funds. In I n t e r m e d i a t e sc ho o l d i s t r i c t s which f o l l o w t h i s p o s i t i o n , 1 t can be s e e n t h a t high v a l u a t i o n d i s t r i c t s which r e c e i v e l i t t l e o r no s t a t e membership money w i l l show few o r no r e c e i p t s , t h e r e b y r a i s i n g t h e i r c l a i m a g a i n s t t h e I n t e r m e d i a t e sch ool d i s t r i c t fund. (Mange, 1 9 8 0 , p. 17) T h i s 1s I l l u s t r a t e d f o r t h e h y p o t h e t i c a l example o f l o c a l school D i s t r i c t s X, Y, and Z. The a l l o w a b l e pr ograms c o s t s ($30,000) and t h e n u m b e r o f s t u d e n t s s e r v e d (10) a r e t h e same f o r each d i s t r i c t . 36 STATE SHARE OF MEMBERSHIP USED IN CALCULATING RECEIPTS D istrict X D istrict Y High M i l l / Med. M i l l / Low SEV Med. SEV D istrict Z Low M i l l / High SEV 1. T o t a l Allowed Program C o s t s $30,000 $30,000 $30,000 2. Minus R e c e i p t s * -18,690 -11*370 - 3,150 3. Eq u al s t h e Amount R e i m b u r s a b le from t h e S p e c i a l E d u c a t i o n M l l l a g e Fund $11,310 $18,630 $26,850 ^C alculation of Receipts: Formula = S t a t e s h a r e o f Membership Allowance t i m e s t h e Number of S t u d e n t s , P l u s S t a t e C a t e g o r i c a l Aid S t a t e C a t e g o r i c a l Aid = Allowed Program C o s t s minus Gr oss Membership Allowance, Times t h e p e r c e n t o f A ctual S t a t e Payment (15% payment 1s assumed) D istrict X= 3 0 , 0 0 0 - ( 2 , 5 4 0 x 10) = 3 0 , 0 0 0 - 2 5 , 4 0 0 = 4 , 6 0 0 4 , 6 0 0 x . 1 5 = 690 D i s t r i c t Y = 3 0 , 0 0 0 - ( 2 , 2 2 0 x 10) = 3 0 , 0 0 0 - 22 ,2 00 = 7 ,8 0 0 7 , 8 0 0 x .15 = 1, 1 7 0 D i s t r i c t Z = 3 0 , 0 0 0 - ( 1 ,9 0 0 x 10) = 3 0 , 0 0 0 - 19, 000 = 11,000 1 1 , 0 0 0 x .15 = 1 , 6 5 0 To ta l R e c e i p t s = S t a t e S h a r e t i m e s number o f s t u d e n t s , p l u s categ o rical aid D istrict X= ( 1 , 8 0 0 x 10) + 690 = 1 8, 00 0 + 690 = 18, 690 D istrict Y= ( 1 , 0 2 0 x 10) + 1, 1 7 0 = 1 0, 20 0 + 1 , 1 7 0 = 11,370 D istrict Z= (150 x 10) + 1 , 6 5 0 = 1, 5 0 0 + 1 , 6 5 0 = 3 , 1 5 0 37 The h y p o t h e t i c a l i l l u s t r a t i o n o f D i s t r i c t s X, Y, and Z i s r e c a l c u ­ l a t e d u s in g t h e s t a t e g r o s s membership a l l o w a n c e . The s t a t e c a t e g o r i c a l a i d would r e m a in t h e same i n both s i t u a t i o n s . STATE MEMBERSHIP ALLOWANCE USED IN CALCULATING RECEIPTS Dist rict 1 D istrict X High M i l l / Low SEV D istrict Y Med. M i l l / Med. SEV 1 . T o t a l Allowed Program C o s ts $30,000 $30,000 $30,000 2 . Minus R e c e i p t s * -26,090 -23,370 -2.0.,55.0 3 . Eq ua ls t h e Amount R e i m b u r s a b le from t h e S p e c i a l E d u c a ti o n M l l l a g e Fund $ 3,910 $ 6,630 $ 9,350 Low M i l l / High SEV C a l c u l a t i o n of Receipts: R e c e i p t s = Gross membership a l l o w a n c e t i m e s t h e number o f s t u d e n t s , plus c a te g o r ic a l aid D istrict X = ( 2 ,5 4 0 x 10) + 690 = 2 5 , 4 0 0 + 690 = 2 6 ,0 9 0 D istrict Y = (2 , 2 2 0 x 10) + 1, 1 7 0 = 2 2 , 2 0 0 + 1, 1 7 0 = 23,37 0 D istrict Z = ( 1 , 9 0 0 x 10) + 1,6 5 0 = 1 9 ,0 0 0 + 1, 6 50 = 2 0 ,6 50 E qu it y 1n t h e d i s t r i b u t i o n o f ISD s p e c i a l e d u c a t i o n m i l l a g e fu n d s 1s a c h i e v e d by p r o v i d i n g , 1n f o r m u l a , 100% o f t h e a d d i t i o n a l c o s t s o c c u r r i n g t o t h e l o c a l sc ho o l d i s t r i c t . Thes e a d d i t i o n a l c o s t s a r e beyond t h e amount a v a i l a b l e and r e c e i v e d f o r a l l s t u d e n t s e n r o l l e d 1n t h e l o c a l d i s t r i c t ( s t a t e membership a l l o w a n c e ) and o t h e r s u p p o r t fu nd s 38 r e c e i v e d f o r t h e s p e c i a l e d u c a t i o n program (1n g e n e r a l , cal a i d ) . s ta te categori­ When v a r i a t i o n s o c c u r 1n c a l c u l a t i n g t h e r e c e i p t s r e c e i v e d from t h e s t a t e , t h e b a l a n c e 1s t i p p e d and I n e q u i t y r e s u l t s . To demon­ s t r a t e t h e I n e q u i t y c r e a t e d by t h e v a r i a t i o n o f u s i n g t h e s t a t e s h a r e o f t h e s t a t e membership a l l o w a n c e 1n c a l c u l a t i n g r e c e i p t s , a co m p ar is o n 1s made between t h e two p r e c e d i n g I l l u s t r a t i o n s f o r D i s t r i c t s X, Y, and Z. The a n a l y s i s 1s based on money a v a i l a b l e t o and r e c e i v e d by t h e l o c a l school d i s t r i c t 1n r e l a t i o n t o t h e a c t u a l s p e c i a l e d u c a t i o n program costs. I t 1s assumed t h a t t h e ISD s p e c i a l e d u c a t i o n m l l l a g e r e i m b u r s e ­ ment 1s pai d a t 100%. F1 r s t , o n ly i k e s t a t e s h a r e M membership .as S h e r e c e i p t r e c e i v e d from t h e s t a t e when c a l c u l a t i n g t h e s p e c i a l e d u c a t i o n m l l l a g e r e i m b u r s e ­ ment 1s used. FUNDS AVAILABLE AND RECEIVED BY THE LXAL SCHOOL DISTRICT WHEN ONLY THE STATE SHARE OF MEMBERSHIP ALLOWANCE IS USED IN CALCULATING RECEIPTS D istrict x High M i l l / Low SEV $25,400 $22,200 $19,000 690 1,1 70 1,65 0 1 1 ,21Q 18» 17 ISDs I n c l u d e d an a l t e r n a t i v e method f o r d i s t r i b u t i n g s p e c i a l e d u c a t i o n m i l l age fun ds w i t h i n t h e i r s p e c i a l e d u c a t i o n p la n s . The I n f o r m a t i o n con­ t a i n e d 1n t h e s p e c i a l e d u c a t i o n p l a n s d e s c r i b i n g t h e a l t e r n a t i v e methods v a r i e d ma rk ed ly in both t h e q u a l i t y and q u a n t i t y o f t h e ma te­ r i a l presented. several In many I n s t a n c e s t h e w o r di n g was vague and open t o Interpretations. The r e s e a r c h e r used a " b e n e f i t o f do ubt" p r i n c i p l e i n e x a m in in g t h e m a t e r i a l p r e s e n t e d t o l e a r n w h e t h e r t h e m a t e r i a l was o p e r a t i o n a l l y I n t e r p r e t a b l e . For example# 1 f a d i s t r i c t s t a t e d t h a t a "membership" was s u b t r a c t e d from t h e a l l o w e d c o s t s # 1 t was assumed t h a t t h e " g r o s s membership a l l o w a n c e " t i m e s t h e number o f f u l l - t i m e e q u i v a l e n t (FTE) s t u d e n t s s e r v e d was s u b t r a c t e d from t h e a l l o w a b l e program c o s t s . (However# t h i s a s s u m p t i o n was found t o be I n c o r r e c t 1n two cases # D i s t r i c t s 20 and 44# a s n o t e d 1n f i n d i n g s f o r S ubsidiary Question If .) Using t h e " b e n e f i t o f doubt" p r i n c i p l e # 2 of t h e 17 a l t e r n a t i v e methods p ro vi d ed i n s u f f i c i e n t I n f o r m a t i o n t o al lo w t h e d i s t r i b u t i o n s ys te m t o be c a l c u l a t e d . Ther ef ore # 15 o f t h e 17 methods p r e s e n t e d were c l a s s i f i e d a s o p e r a t i o n a l l y I n t e r p r e t a b l e t o t h e e x t e n t t h a t t h e I n f o r m a t i o n p r o v id e d would a l l o w f o r c a l c u l a t i n g and f o l l o w i n g t h e d i s t r i b u t i o n sy ste m a s w r i t t e n . These f i n d i n g s a r e r e p o r t e d 1n T a b l e 2. S u b s i d i a r y Q u e s t i o n I f . For ISDs t h a t I n c l u d e d an a l t e r n a t i v e method f o r d i s t r i b u t i n g s p e c i a l e d u c a t i o n m l l l a g e f u n d s w i t h i n t h e i r s p e c i a l e d u c a t i o n plans# how many were f o l l o w i n g t h e a l t e r n a ­ t i v e method a s w r i t t e n ? 68 Findings. As d i s c u s s e d un de r S u b s i d i a r y Q u e s t i o n l e , 2 o f 17 a l t e r n a t i v e me thods f o r d i s t r i b u t i n g s p e c i a l e d u c a t i o n m l l l a g e f u n d s t o c o n s t i t u e n t sch ool d i s t r i c t s I n c l u d e d w i t h i n 1984-85 ISD s p e c i a l educa­ t i o n p l a n s w e r e c o n s i d e r e d n o t t o be o p e r a t i o n a l l y I n t e r p r e t a b l e , and t h e r e f o r e c a n n o t be f o l l o w e d . c o ul d p o s s i b l y be f o l l o w e d . T h i s l e f t 15 a l t e r n a t i v e methods t h a t The 15 methods w e re I n d i v i d u a l l y e v a l u a t e d t o d e t e r m i n e w h e t h e r t h e a l t e r n a t i v e method was b ei ng f o l l o w e d a s w r i t t e n i n t h e r e s p e c t i v e s p e c i a l e d u c a t i o n pla n. Of t h e 15 a l t e r n a ­ t i v e methods* f i v e ( D i s t r i c t s 07, 20 , 31 , 32, and 44) were n o t bei ng follow ed as w r i t t e n . D i f f e r e n c e s were d i s c o v e r e d 1n methods used t o d e t e r m i n e a l l o w e d c o s t s ( D i s t r i c t s 07 and 32 ), c a l c u l a t i o n o f member­ s h i p r e c e i p t s ( D i s t r i c t s 07, 20, and 44), and c a l c u l a t i o n of s t a t e categorical a i d r e c e i p t s ( D i s t r i c t 31). Therefore, o n ly 10 o f t h e 17 a l t e r n a t i v e methods I n c l u d e d In 1984-85 s p e c i a l e d u c a t i o n p l a n s were c o n s i d e r e d t o be f o l l o w e d a s w r i t t e n . S u b s i d i a r y Q u e s t i o n l g . How many ISDs w e r e f o l l o w i n g Rule 3 4 0 . 1 8 1 2 , s u b r u l e s (1) and (2)? Findings. Rule 340.1812, s u b r u l e s (1) and (2), govern t h e use of s p e c i a l e d u c a t i o n m l l l a g e f u n d s f o r programs and s e r v i c e s o p e r a t e d by an ISD. S u b r u l e (1) a l l o w s an ISD t o pay I t s t o t a l c o s t s f o r o p e r a t i n g p ro gr am s and s e r v i c e s on b e h a l f o f and a v a i l a b l e t o a l l c o n s t i t u e n t sc hoo l d i s t r i c t s f i r s t , b e f o r e r e i m b u r s i n g c o n s t i t u e n t school d i s t r i c t s f o r t h e p ro g ram s and s e r v i c e s t h e y o p e r a t e . S u b r u l e (2) r e q u i r e s an ISD t h a t p r o r a t e s p ay m en ts t o c o n s t i t u e n t sch ool d i s t r i c t s and p r o v i d e s d i r e c t s e r v i c e s t o h a n d i c a p p e d s t u d e n t s 1n some, b u t n o t a l l , 69 c o n s t i t u e n t sch oo l d i s t r i c t s t o b i l l t h e r e s i d e n t d i s t r i c t s o f t h e s tu d e n t(s) served f o r t h e i r p r o p o r tio n a te sh a re of t h e cost. An a l t e r n a t i v e t o b i l l i n g c o n s t i t u e n t sc ho ol d i s t r i c t s , when t h e ISD p r o v i d e s d i r e c t s e r v i c e 1n some, b u t n o t a l l , c o n s t i t u e n t school d i s ­ t r i c t s would be t o pay t h e f u l l u n r e i m b u r s e d c o s t s o f any g iv e n t y p e o f program o r s e r v i c e p r o v i d e d by both t h e c o n s t i t u e n t school d i s t r i c t and t h e ISD f i r s t , b e f o r e p r o r a t i n g t h e payment f o r o t h e r t y p e s of con­ s t i t u e n t school d i s t r i c t s p e c i a l e d u c a t i o n pr ograms and s e r v i c e s . a l t e r n a t i v e 1s a l l o w e d by Rul e 340.1811, s u b r u l e (4). Th is For ex am pl e, an ISD p r o v i d e s s o c i a l w o r k e r s e r v i c e s t o a l l c o n s t i t u e n t school d i s t r i c t s e x c e p t one. Rather than b i l l i n g a l l th e c o n s t i t u e n t d i s t r i c t s , except t h a t one, f o r t h e i r p r o p o r t i o n a t e s h a r e o f t h e c o s t s f o r s o c i a l worker s e r v i c e s , t h e ISD m i g h t e l e c t t o pay t h e f u l l u n r e i m b u r s e d c o s t s o f s o c i a l w o rk er s e r v i c e s 1n t h e one d i s t r i c t o p e r a t i n g i t s own program, b e f o r e p r o r a t i n g t h e payment f o r o t h e r c o n s t i t u e n t scho ol d i s t r i c t p r o g r a m s and s e r v i c e s . In t h i s c a s e , t h e s o c i a l wor ker program would be c o n s i d e r e d a program a v a i l a b l e t o a l l c o n s t i t u e n t sc ho ol d i s t r i c t s , and t h e f u l l u n r e i m b u r s e d c o s t s f o r t h e program may be p a i d f i r s t , b e f o r e p r o r a t i n g o t h e r c o n s t i t u e n t d i s t r i c t s p e c i a l e d u c a t i o n programs. S u b r u l e (1) was f o l l o w e d by a l l ISDs f o r which 1 t was a p p l i c a b l e . Of t h e 52 p a r t i c i p a t i n g ISDs, 13 d id n o t r e i m b u r s e c o n s t i t u e n t d i s ­ t r i c t s and s u b r u l e (1) d i d n o t app ly . The r e m a i n i n g 39 ISDs a l l fol­ lowed t h e o p t i o n a l l o w e d 1n s u b r u l e (1). S u b r u l e (2) a p p l i e s o n l y where ISD s t a f f p r o v i d e s e r v i c e s 1n some, but not a l l , c o n s t i t u e n t sc h o o l d i s t r i c t s . Of t h e 52 p a r t i c i p a t i n g 70 ISDs, 31 p r o v i d e d o n l y t h o s e s e r v i c e s t h a t w e re n o t p r o v i d e d by t h e i r c o n s t i t u e n t sc ho ol d i s t r i c t s . f o l l o w S u b r u l e (2). T h i s l e f t 21 ISDs t h a t w er e r e q u i r e d t o Of t h o s e 21 ISDs, 10 w ere n o t f o l l o w i n g t h i s s u b r u l e bec au se t h e y w er e pay in g t h e f u l l c o s t s of s t a f f who p r o v id e d pro gr ams and s e r v i c e s t o h a n d i c a p p e d s t u d e n t s 1n some l o c a l d i s t r i c t s , b u t p r o r a t e d t h e s u p p o r t o f s t a f f who p r o v i d e d t h e s e same s e r v i c e s 1n o th e r local d istricts. T h e r e f o r e , o nl y 11 o f t h e 21 ISDs r e q u i r e d t o f o l l o w s u b r u l e (2) w er e do in g so . These f i n d i n g s a r e r e p o r t e d 1n Table 3 . Additional Findings fo r R es ear ch Q u e s ti o n 1 Rule 340.1811, s u b r u l e (1), s t i p u l a t e s t h a t s p e c i a l e d u c a t i o n m l l l a g e fun ds be used s o l e l y f o r t h e s u p p o r t of s p e c i a l e d u c a t i o n p ro gr am s and s e r v i c e s . When d e s i g n i n g t h i s s t u d y , i t was a n t i c i p a t e d t h a t a l l ISDs were co m p ly in g w i t h s u b r u l e (1), and t h e s t u d y was n o t s p e c i f i c a l l y d e s i g n e d t o d i s c o v e r w h e t h e r t h i s p r o v i s i o n was being followed. However, 1n t h e p r o c e s s o f d a t a c o l l e c t i o n and a n a l y s i s , 1t was d i s c o v e r e d t h a t f o u r ISDs ( D i s t r i c t s 2 3 , 31 , 43, and 53) were u s in g s p e c i a l e d u c a t i o n m l l l a g e f u n d s t o pay a l l o r p a r t o f w h a t t h e s t a t e " r e c a p t u r e d " from t h e i r " o u t - o f - f o r m u l a " c o n s t i t u e n t school d i s t r i c t s by r e d u c i n g s t a t e c a t e g o r i c a l a i d payments. In b r i e f , some s ch oo l d i s t r i c t s , f o r m u l a school d i s t r i c t s , which have been te rm ed o u t - o f ­ r e c e i v e more r e v e n u e p e r s t u d e n t and p e r m i l l l e v i e d t h a n do o t h e r s ch oo l d i s t r i c t s b e c a u s e o f a h i g h e r s t a t e e q u a l ­ iz e d v a l u a t i o n (SEV) p e r s t u d e n t f o r t h e sc h o o l d i s t r i c t . When t h e p e r 71 s t u d e n t amount r a i s e d from l o c a l school d i s t r i c t p r o p e r t y t a x e s exc e ed s t h e s t a t e - d e t e r m i n e d and g u a r a n t e e d per s t u d e n t " g r o s s membership a l lo w a n c e * " a school d i s t r i c t 1s s a i d t o be o u t - o f - f o r m u l a . Some o u t - o f - f o r m u l a d i s t r i c t s r e c e i v e two o r t h r e e t i m e s t h e r e v e n u e p e r s t u d e n t a s do I n - f o r m u l a d i s t r i c t s * even w i t h l o w e r m l l l a g e r a t e s . The s t a t e l e g i s l a t u r e d e t e r m i n e d t h i s t o be an u n f a i r a d v a n t a g e and d e c i d e d t o " r e c a p t u r e " t w o - t h i r d s o f t h e amount t h a t exce eded a d i s t r i c t ' s g r o s s membership a l l o w a n c e . R a t h e r th a n d i r e c t l y b i l l i n g t h e o u t - o f - f o r m u l a d i s t r i c t s f o r t h i s amount* t h e s t a t e e l e c t e d t o s u b t r a c t t h e e x c e s s amount (phased 1n o v e r a p e r i o d of s e v e r a l y e a r s ) from payments a l r e a d y made t o t h e s e d i s t r i c t s 1n s t a t e c a t e g o r i c a l a i d programs* o f which s p e c i a l e d u c a t i o n 1s t h e l a r g e s t . To be c l e a r , what t h e s t a t e 1s r e c a p t u r i n g from t h e o u t - o f - f o r m u l a d i s t r i c t s by r e d u c i n g t h e s p e c i a l e d u c a t i o n c a t e g o r i c a l payment 1s I n t e n d e d t o be a r e c a p t u r e from t h e general fund r e v e n u e s o f t h e d i s t r i c t , f o r t h e s p e c i a l e d u c a t i o n program. r a t h e r t h a n r e d u c t i o n 1n s u p p o r t I t was s i m p l y t h o u g h t t o be a d e s i r a b l e a l t e r n a t i v e t o d i r e c t l y b i l l i n g t h e o u t - o f - f o r m ul a d i s t r i c t . However* a t l e a s t f o u r ISDs, p e r h a p s b ec a u se of p o l i t i c a l p ressures or t h r o u g h m i s u n d e r s t a n d i n g , a r e u s i n g e a r m a rk e d s p e c i a l e d u c a t i o n m l l l a g e f u n d s t o r e p l a c e a l l o r p a r t o f w h at 1s be in g r e c a p t u r e d from t h e s t a t e special education categ o rica l payments t o t h e i r o u t - o f - f o r m u l a d i s ­ tricts. As I n d i c a t e d above, a t l e a s t f o u r ISDs w ere I n v o l v e d 1n t h i s practice. T h i s f a c t 1s em ph asi zed b e c a u s e t h e q u e s t i o n o f w h e t h e r s u b r u l e (1) o f Rule 340.1811 was b ei ng f o l l o w e d was n o t s p e c i f i c a l l y 72 s t u d i e d , and t h e f o u r ISDs t h a t w e r e d i s c o v e r e d I n c i d e n t a l l y s h o u ld be c o n s i d e r e d a minimum. Even though t h i s p r a c t i c e was d i s c o v e r e d 1n j u s t f o u r ISDs, 1 t I n v o l v e s l a r g e sums o f money. For ex a m p le , 1n one ISD f o r which t h e r e s e a r c h e r r e c e i v e d s p e c i f i c d a t a , $169,245 o f e a r ­ marked s p e c i a l e d u c a t i o n m l l l a g e money was p a i d t o one o u t - o f - f o r m u l a c o n s t i t u e n t d i s t r i c t t o r e p l a c e a p o r t i o n o f t h e amount r e c a p t u r e d from t h i s d i s t r i c t by r e d u c i n g t h e s t a t e s p e c i a l e d u c a t i o n c a t e g o r i c a l a i d payment. The p r a c t i c e o f an ISD u s i n g s p e c i a l e d u c a t i o n m l l l a g e fu n ds t o pay a l l o r a p o r t i o n o f w h at t h e s t a t e 1s r e c a p t u r i n g from I t s o u t - o f ­ f o r m u l a c o n s t i t u e n t school d i s t r i c t s was a l s o c o n s i d e r e d a v a r i a t i o n o f t h e method o u t l i n e d 1n t h e d i s t r i b u t i o n r u l e s f o r c a l c u l a t i n g r e c e i p t s r e c e i v e d from t h e s t a t e , Rule 340.1811, s u b r u l e (3). The f o u r ISDs f o l l o w i n g t h i s p r a c t i c e w ere d e t e r m i n e d n o t t o be f o l l o w i n g t h e p r o v i ­ sio n s of t h i s subrule. The q u e s t i o n o f e q u i t y 1n t h e d i s t r i b u t i o n o f s p e c i a l e d u c a t i o n m l l l a g e f u n d s f o r ISDs f o l l o w i n g t h i s p r a c t i c e was a d d r e s s e d a s a v a r i a t i o n o f Rule 340.1811, c u s s e d un d e r R es ear ch Q u e s t i o n 2, s u b r u l e (3), and 1s d i s ­ S u b s i d i a r y Q u e s t i o n 2b. In summary, a t l e a s t f o u r ISDs hav e been u s i n g v o t e r - e a r m a r k e d s p e c i a l e d u c a t i o n m l l l a g e f u n d s t o r e p l a c e a l l o r p a r t o f w ha t t h e s t a t e 1s r e c a p t u r i n g from t h e g e n e r a l rev en ue fu nd s o f t h e i r o u t - o f ­ f o r m u l a sc h oo l d i s t r i c t s by r e d u c i n g s t a t e s p e c i a l e d u c a t i o n c a t e g o r i ­ cal a i d payments. T h i s 1s u n q u e s t i o n a b l y a v i o l a t i o n o f Rule 340.1811, s u b r u l e (1), which r e q u i r e s s p e c i a l e d u c a t i o n m l l l a g e f u n d s t o be used s o l e l y f o r t h e s u p p o r t of s p e c i a l e d u c a t i o n pr o gr am s and s e r v i c e s . 73 Summary D i s c u s s i o n o f F i n d i n g s f o r Re s ea rc h Q u e s t i o n 1 Michigan S p e c i a l E d u c a t i o n Ru le s 340.1811 and 340.1812 g ov er n t h e d i s t r i b u t i o n o f ISD s p e c i a l e d u c a t i o n m l l l a g e fu nd s t o c o n s t i t u e n t sc ho ol d i s t r i c t s and t h e use o f t h e s e fun ds f o r programs o p e r a t e d by t h e ISD. The r u l e s were d e s i g n e d t o e n s u r e t h a t s p e c i a l e d u c a t i o n m i l l a g e f u n d s would be d i s t r i b u t e d e q u i t a b l y both among and w i t h i n ISDs. The p u r p o s e o f R e s e a r c h Q u e s t i o n 1 was t o d i s c o v e r how many ISDs w e r e f o l l o w i n g Ru le s 340.1811 and 340.1812. Rule 340.1811, s u b r u l e s (2), (3), and (4), d e t a i l s t h e method ISDs s h o u l d us e when d i s t r i b u t i n g s p e c i a l e d u c a t i o n m l l l a g e fun ds t o con­ s t i t u e n t sch oo l d i s t r i c t s . S u b r u l e (7) o f Ru le 340.1811 a l l o w s an ISD t o use an a l t e r n a t i v e method f o r d i s t r i b u t i n g s p e c i a l e d u c a t i o n m l l l a g e f u n d s t o c o n s t i t u e n t sc h oo l d i s t r i c t s 1f t h e a l t e r n a t i v e method and t h e r e a s o n s t h e r e f o r a r e s u b m i t t e d f o r app rov al a s p a r t o f t h e ISD’s s p e ­ c ia l education p lan . Of t h e 52 ISDs t h a t p a r t i c i p a t e d 1n t h i s s t u d y , 13 d i d n o t r e i m ­ b u r s e c o n s t i t u e n t scho ol d i s t r i c t s and Rule 340.1811, ( 3 ) , ( 4 ) , and ( 7 ) , d i d n o t a p p l y . s u b r u l e s (2), Of t h e r e m a i n i n g 39 ISDs, s i x r e p o r t e d me thods t h a t f o l l o w e d d i s t r i b u t i o n s u b r u l e s (2), (3), and (4) o f Rule 340.1811, and 33 r e p o r t e d methods t h a t d id n o t f o l l o w a t l e a s t one o f t h e s e s u b r u l e s and were c l a s s i f i e d a s a l t e r n a t i v e methods. Q£ t h e 33 ISDs t h a t used an a l t e r n a t i v e me t h o d , onl y 17 I n c l u d e d I n f o r m a ­ t i o n c o n c e r n i n g t h e i r d i s t r i b u t i o n meth o d w i t h in t h e i r s p e c i a l ed uca ­ t i o n plan, a s r e q u i r e d bv Rule 340.1811, s u b r u l e (7). P ro bl em s w e r e a l s o n o te d 1n t h e w r i t t e n d e s c r i p t i o n s of t h e a l t e r n a t i v e m e tho ds , and 74 1 t was d i s c o v e r e d t h a t o n l y 10 o f t h e 17 a l t e r n a t i v e methods w e r e being followed as w r itte n . Only 2 . o f t h e 17 a l t e r n a t i v e methods I n c lu d e d w1t h 1n t h e ISD s p e c i a l e d u c a t i o n p l a n s c o n t a i n e d t h e r e q u i r e d r e a s o n s f o r u s in g an a l t e r n a t i v e method. Thus, s i x ISDs f o l l o w e d t h e d i s t r i b u t i o n method s e t f o r t h by Rule 340.1811, s u b r u l e s (2), (3), and (4), and tw o f o l l o w e d t h e r e q u i r e m e n t s f o r u s i n g an a l t e r n a t i v e method, as a l l o w e d by Rule 340.1811, s u b r u l e (7). Therefore, o f t h e 39 ISDs t h a t w e r e r e q u i r e d t o f o l l o w Rule 3 4 0 . 1 8 1 1 , s u b r u l e s ( 2 ) , ( 3 ) , and ( 4 ) , o r s u b r u l e ( 7 ) , o n l y e i g h t w e r e following th e required p ro v isio n s. Rule 340.1812 r e g u l a t e s t h e use o f s p e c i a l e d u c a t i o n m l l l a g e funds f o r ISDs when t h e y o p e r a t e s p e c i a l e d u c a t i o n progr ams and s e r v i c e s 1n some, but n o t a l l , c o n s t i t u e n t sch oo l d i s t r i c t s . S u b r u l e s (1) and (2) o f Rule 340.1812 r e q u i r e t h a t t h e same l e v e l o f f i n a n c i a l s u p p o r t be p r o v i d e d f o r a s p e c i a l e d u c a t i o n program w h e t h e r t h e program 1s o p e r ­ a t e d by t h e ISD o r a c o n s t i t u e n t sc h o o l d i s t r i c t . Of t h e 52 ISDs t h a t p a r t i c i p a t e d 1n t h i s s t u d y , 31 p r o v i d e d o n l y t h o s e s e r v i c e s t h a t w ere n o t p r o v i d e d by c o n s t i t u e n t s ch oo l d i s t r i c t s ; d i d n o t apply. therefore, Rule 340.1812 Of t h e r e m a i n i n g 21 ISDs t h a t were, r e q u i r e d . t o . c o m p l y w i t h Rule 340.1812, o n l y 11 f o l l o w e d t h e r e q u i r e d p r o v i s i o n s . In c o n c l u s i o n , of t h e 52 ISDs t h a t p a r t i c i p a t e d 1n t h i s s t u d y , 39 w ere r e q u i r e d t o f o l l o w R u le 340.1811, s u b r u l e s (2), (3), and (4) o r s u b r u l e (7), and 21 were r e q u i r e d t o f o l l o w Rule 340.1812. Of t h e 21 ISDs r e q u i r e d t o f o l l o w R u le 340.1812, 18 w ere I n c l u d e d 1n t h e c o u n t o f t h e 39 r e q u i r e d t o f o l l o w Rule 340.1811, s u b r u l e s (2), (3), and (4) o r 75 s u b r u l e (7) and t h r e e ( D i s t r i c t s 14» 34» and 42) were e x cl ud ed bec a u se t h e y d i d n o t r e i m b u r s e c o n s t i t u e n t s ch oo l d i s t r i c t s . (Only one of t h e s e t h r e e , D i s t r i c t 34* was f o l l o w i n g t h e p r o v i s i o n s o f Rule 340.1812.) Adding t h e t h r e e ISDs t o t h e 39 above* 1 t was found t h a t 42 o f t h e 52 ISDs p a r t i c i p a t i n g 1n t h i s s tu d y were r e q u i r e d t o f o l l o w R u l e s 3 4 0 . 1 8 1 1 , s u b r u l e s (2)» (3 ) a n d (4) o r s u b r u l e ( 7 ) , a n d / o r 340.1812. Of t h e s e 42 ISDs, o n l y n i n e were f o l l o w i n g t h e r e q u i r e d r u l e s g o v e r n i n g t h e d i s t r i b u t i o n o f I SD s p e c i a l e d u c a t i o n m l l l a g e fun ds t o c o n s t i t u e n t sc h oo l d i s t r i c t s . These f i n d i n g s a r e r e p o r t e d 1n T a b l e 5* which 1s a summary t a b l e o f t h e ISDs t h a t w e r e f o l l o w i n g and n o t f o l l o w i n g Rule s 340.1811 and 340.1812. R es ear ch Q u e s t i o n 2 How do t h e d i f f e r e n t t y p e s o f a l t e r n a t i v e methods used by ISDs t o d i s t r i b u t e s p e c i a l e d u c a t i o n m l l l a g e funds t o c o n s t i t u e n t school d i s t r i c t s * and any r e a s o n s g iv e n 1n t h e i r s p e c i a l e d u c a t i o n p l a n s f o r so doing* r e l a t e t o t h e s y st em o f e q u i t y embodied w i t h i n Mich i­ gan S p e c i a l E d u c a ti o n Rul e 340.1811, s u b r u l e s (2)» (3), and (4)? In te n tio n of Inquiry The ISD s p e c i a l e d u c a t i o n m l l l a g e r a i s e s v o t e r - a p p r o v e d a d d i t i o n a l m l l l a g e s u p p o r t t h a t 1s e a r m a r k e d f o r s p e c i a l e d u c a t i o n pr ograms and s e r v i c e s f o r a l l h a n d i c a p p e d c h i l d r e n r e s i d i n g w i t h i n t h e ISD. The g e n e r a l p u r p o s e o f a d i s t r i b u t i o n method used by an ISD 1s t o t r a n s f e r t h e fund s r a i s e d from t h e s p e c i a l e d u c a t i o n m l l l a g e le v y t o c o n s t i t u e n t sch ool d i s t r i c t s t o r e i m b u r s e a l l o r a p o r t i o n o f t h e i r a d d i t i o n a l c o s t s f o r p r o v i d i n g s p e c i a l e d u c a t i o n pr ograms and s e r v i c e s . T a b l e 5 . — I n f o r m a t i o n r e c e i v e d from ISDs an d s u b m i t t e d w i t h i n t h e i r s p e c i a l e d u c a t i o n p l a n s p e r t a i n i n g t o R u l e s 3 ^ 0 .1 8 1 1 and 3 4 0 .1 8 1 2 . D i s t r i c t Code Number 01 F o llow ed r u l e s S u b ru le s fo llo w ed : R 3 4 0 .1 8 1 1 ( 2 ) R 3 4 0 .1 8 1 1 ( 3 ) R 3 4 0 .1 8 1 1 ( 4 ) R 3 4 0 .1 8 1 1 ( 7 ) R 340.1812(1) R 3 4 0 .1 8 1 2 ( 2 ) 02 N 07 08 09 10 Y N Y Y NA 7 7 7 7 7 7 Y Y Y NA Y Y NA NA NA YN Y N Y Y Y NA Y Y Y Y Y NA Y Y NR NR NR NA NA NA 25 26 27 28 29 30 03 04 05 06 N Y N 7 N N N N Y NA N N N N Y NA Y Y Y NA Y Y NR NR NR NA NA N 22 23 24 11 12 13 14 15 16 17 18 19 20 21 N Y NA N NA N N N NA N NA NA NA NA YN Y Y Y Y Y NA Y Y NR NR NR NA NA NA NA NA NA YN Y N NR NR NR NA NA NA Y N Y N Y NA N N N N Y NA N Y Y N Y Y NR NR NR NA NA NA NA NA NA YN Y N NR NR NR NA NA NA 41 42 D i s t r i c t Code Number F o llo w e d r u l e s S u b ru le s fo llo w e d : R 340.1811(2) R 3 4 0 .1 8 1 1 ( 3 ) R 340.1811(4) R 340.1811(7) R 340.1812(1) R 340.1812(2) 31 32 33 34 35 36 37 38 39 40 NA N N Y NA N N Y N N N N Y N N NA NA 7 N N N NR NR NR NA NA NA N N Y N Y NA N Y Y N Y NA NA NA NA Y Y Y NR NR NR NA NA NA N Y Y N Y NA NA NA NA YN Y NA NA NA NA Y Y NA N N N N Y NA NA NA NA YN Y NA NA NA NA YN Y NA N N Y N Y NA NR NR NR NA NA Y N N N N Y N Y N Y N Y NA NR NR NR NA NA NA NR NR NR NA NA NA 7 7 7 7 7 7 NA NA NA YN Y N NA NA NA YN Y Y NR NR NR NA NA N 43 44 45 46 47 48 49 50 N N 7 Y N N NA N Y N Y N Y NA NA NA NA YN Y N 7 7 7 7 7 7 Y Y Y NA Y NA Y N Y N Y NA NA NA NA YN Y N NR NR NR NA NA NA NA NA NA YN Y NA Summary Data D i s t r i c t Code Number F o llo w e d r u l e s S u b r u 1e s f o 11ow ed: R 340.1811(2) R 3 4 0 .1 8 1 1 ( 3 ) R 340.1811(4) R 3 4 0 .1 8 1 1 ( 7 ) R 3 4 0 .1 8 1 2 ( 1 ) R 340.1812(2) NA NR 7 TOTAL 33 10 — 3 55 13 12 7 16 0 10 ,7 a ,7a ,7 b 19 13 31 13 13 13 3 3 3 3 3 3 55 55 55 55 55 55 52 53 54 55 Y N N N N N N 9 N N N N Y N NA NA NA YN Y NA NA NA NA YN Y HA Y Y N N Y Y NA NA NA YN Y NA 9 10 15 2 39 11 51 YN 15 — — Y - Y es, N - No, NA - Not A p p l i c a b l e , NR - No R e im b u r s e m e n t, ? ■ I n f o r m a t i o n Not P r o v i d e d , YN - A l t e r n a t i v e Method I n c l u d e d in S p e c i a l E d u c a t i o n P l a n — No R e aso ns Given a Not a p p l i c a b l e b e c a u s e a l t e r n a t i v e method was i n c l u d e d in s p e c i a l e d u c a t i o n p l a n . **0f t h e 19 d i s t r i c t s c o n s titu e n t d i s t r i c t s . in w hich R ule 3 4 0 .1 8 1 1 ( 7 ) d o e s n o t a p p l y , 6 a r e f o l l o w i n g t h e d i s t r i b u t i o n r u l e s an d 13 do n o t r e i m b u r s e 77 Rule 340.1811» s u b r u l e s (2), (3)# and (4), of t h e Michi gan S p e c i a l E d u c a t i o n R ul es o u t l i n e s a s p e c i f i c method f o r d i s t r i b u t i n g s p e c i a l e d u c a t i o n m l l l a g e fun ds t o c o n s t i t u e n t school d i s t r i c t s . These sub­ r u l e s e s t a b l i s h a sy ste m o f e q u i t y based on a f u H - s u p p o r t o r l i k e p e r c e n t payment f o r t h e u n r e i m b u r s e d a d d i t i o n a l c o s t s o f p r o v i d i n g s p e c i a l e d u c a t i o n pr o gr am s and s e r v i c e s f o r a l l c o n s t i t u e n t school districts. As r e p o r t e d 1n t h e f i n d i n g s f o r R es ear ch Q u e s t i o n 1, 33 ISDs used an a l t e r n a t i v e method f o r d i s t r i b u t i n g s p e c i a l e d u c a t i o n m l l l a g e funds to constituent sch ool d i s t r i c t s . The a l t e r n a t i v e methods w er e c l a s s i ­ f i e d by t y p e o f d i s t r i b u t i o n s y s t e m , and d e s c r i p t i o n s o f t h e v a r i o u s p r a c t i c e s a r e g i v e n 1n t h e f o l l o w i n g pages. The methods used t o c a l c u ­ l a t e r e i m b u r s e m e n t t o c o n s t i t u e n t sc h o o l d i s t r i c t s a r e e x p l a i n e d . For each of t h e a l t e r n a t i v e methods used f o r d i s t r i b u t i n g s p e c i a l e d u c a t i o n m l l l a g e funds t o c o n s t i t u e n t sc h o o l d i s t r i c t s , v a r i a t i o n s r e s u l t 1n t h e l e v e l of s u p p o r t p r o v id e d . To a n s w e r t h e q u e s t i o n o f how t h e 33 a l t e r n a t i v e me thods r e l a t e t o t h e p r i n c i p l e o f e q u i t y embodied w i t h i n t h e Michi gan S p e c i a l E d u c a t i o n R u le s, t h e d i f f e r e n t t y p e s o f d i s t r i b u t i o n s y s t e m s w ere examined. a f f e c t equity, ISDs t h a t The v a r i a n t p r a c t i c e s , a s th e y a r e discussed. u s e an a l t e r n a t i v e d i s t r i b u t i o n s y st em t o the s ta te methods a r e r e q u i r e d t o I n c l u d e t h e a l t e r n a t i v e method and t h e r e a s o n s t h e r e f o r w ith in t h e i r sp e cia l education plans. As r e p o r t e d under S u b s i d i a r y Q u e s t i o n I d , o n l y 2 of t h e 17 a l t e r n a t i v e methods p r e s e n t e d w ithin special education plans contained t h e required reasons. The 78 r e a s o n s g iv e n a r e p r e s e n t e d and d i s c u s s e d a s t h e s e r e l a t e t o t h e i r r e s p e c t i v e a l t e r n a t i v e me thods and t h e e q u i t a b l e d i s t r i b u t i o n o f s p e ­ c i a l e d u c a t i o n m l l l a g e f un ds . S u b s i d i a r y Q u e s ti o n 2 a . How many d i f f e r e n t t y p e s o f a l t e r n a t i v e met hod s w ere used by ISDs f o r d i s t r i b u t i n g s p e c i a l e d u c a t i o n m i l l age fu n ds ? Findings. The 33 a l t e r n a t i v e methods used by ISDs f o r d i s t r i b u t ­ in g s p e c i a l e d u c a t i o n m l l l a g e f u n d s can be c l a s s i f i e d I n t o f o u r broad ty p e s or c a t e g o r ie s of d i s t r i b u t i o n systems. The f i r s t t y p e 1s t h e f l a t - g r a n t d i s t r i b u t i o n s y s t e m , 1n which a s e t d o l l a r amount ( o r f l a t g r a n t ) 1s d i s b u r s e d f o r each s p e c i f i e d prog ram o r s e r v i c e u n i t , each c l a s s r o o m program o r each p r o f e s s i o n a l s t a f f member. ty p e 1s t h e e x c e s s - c o s t d i s t r i b u t i o n s y s t e m , such as The second 1n which t h e v a r i a t i o n from t h e e x c e s s - c o s t me thods embodied w i t h i n t h e Michigan S p e c i a l E d u c a ti o n R u le s I n v o l v e s d i f f e r e n c e s 1n d e t e r m i n i n g w h a t c o s t s a r e a l l o w e d , c a l c u l a t i o n s o f r e c e i p t s , a n d / o r t h e manner o f payment. The t h i r d t y p e 1s a p r o p o r t i o n a t e g e n e r a l s t u d e n t membership d i s t r i b u t i o n s y s t e m , 1n which a v a i l a b l e f u n d s a r e d i s b u r s e d p r o p o r t i o n a t e l y , based on t h e g e n e r a l s t u d e n t me mbe rs hip c o u n t o f each c o n s t i t u e n t school d istrict. system, The f o u r t h t y p e 1s a w e i g h t e d prog ram c o s t d i s t r i b u t i o n In which funds a r e p r o p o r t i o n a t e l y d i s b u r s e d on t h e b a s i s o f t h e w e i g h t e d p r e v l o u s - t h r e e - y e a r a v e r a g e program c o s t . Of t h e 33 a l t e r n a t i v e methods used by ISDs f o r d i s t r i b u t i n g s p e c i a l e d u c a t i o n m l lla g e funds t o c o n s t i t u e n t school d i s t r i c t s , 79 1. Seven were u s i n g a f l a t - g r a n t d i s t r i b u t i o n sy st em , 2. T w e n t y - f o u r w e r e u s in g v a r i a t i o n s o f t h e s t a t e e x c e s s - c o s t d i s t r i ­ bution system, 3. One was u s i n g a p r o p o r t i o n a t e g e n e r a l s t u d e n t membership d i s t r i b u ­ t i o n s y s t e m , and 4. One was u s i n g a w e i g h t e d program c o s t - d 1 s t r 1 b u t 1 o n syst em. F l a t - g r a n t d i s t r i b u t i o n system. Of t h e se ven ISDs t h a t w e re u s i n g a f l a t - g r a n t d i s t r i b u t i o n s y s t e m , t h r e e used t h e f u l l - t i m e e q u i v a l e n t (FTE) number of p r o f e s s i o n a l s t a f f members a s t h e d i s t r i b u t i o n u n i t , and f o u r used t h e number o f c l a s s r o o m programs. One of t h e ISDs t h a t d i s t r i b u t e d a f l a t g r a n t p e r p r o f e s s i o n a l s t a f f member a l s o d i s t r i b u t e d a f l a t g r a n t f o r each c l a s s r o o m a i d e (FTE). Two of t h e ISDs t h a t d i s t r i b u t e d a f l a t g r a n t p e r c l a s s r o o m program a l l o w e d a l a r g e r (or a d d i t i o n a l ) f l a t g r a n t f o r t h e I n i t i a l y e a r o f a c l a s s r o o m prog ram , and one o f t h e s e tw o ISDs a l s o d i s t r i b u t e d a f l a t g r a n t p e r c l a s s r o o m a i d e . T h i s I n f o r m a t i o n 1s r e p o r t e d 1n T a b l e 6. F iv e o f t h e seven ISDs t h a t used a f l a t - g r a n t d i s t r i b u t i o n s y s t e m r e i m b u r s e d c o n s t i t u e n t s ch o ol d i s t r i c t s t h e f u l l u n r e i m b u r s e d c o s t s f o r some s p e c i a l e d u c a t i o n pr og ra m s and s e r v i c e s b u t n o t f o r o t h e r s . Four r e i m b u r s e d t h e f u l l u n r e i m b u r s e d c o s t s o f p ro g ram s a v a i l a b l e t o a l l c o n s t i t u e n t d i s t r i c t s ( c e n t e r p r og r am s ) , and one r e i m b u r s e d t h e f u l l u n r e i m b u r s e d c o s t s of I t i n e r a n t s e r v i c e s . 1 n T a b l e 6. T h i s I n f o r m a t i o n 1s r e p o r t e d 80 T a b l e 6.— F l a t - g r a n t d i s t r i b u t i o n s y s t e m s used by ISDs 1n Michigan d u r i n g t h e 1984-85 sch oo l y e a r . D i s t r i c t Code Number Totals 02 17 29 X X X 50 30 51 55 F u l l Unre1mbursed_Costs: C e n t e r Pr ogr am s I t i n e r a n t Services X 4 1 X F l a t - G r a n t Amount: Funds/No. o f U n i t s P e t . o f Ave. S a l a r . S e t by Admin. X X X X X X X X X X X X X 4 1 3 F l a t - G r a n t U ni t: P r o f . S t a f f (FTE) Classroom Programs New C la ssr oo ms Classroom Aides X X X 3 X X X k 2 2 Three methods were used t o d e t e r m in e t h e amount o f a f l a t g r a n t . Four d i s t r i c t s d i v i d e d t h e fund s a v a i l a b l e by t h e t o t a l number o f f l a t g r a n t u n i t s (e.g., professional s t a f f members, c l a s s r o o m pr ogr am s) . One d i s t r i c t used a f o r m u l a t o c a l c u l a t e a p r o p o r t i o n o f t h e a v e r a g e s t a f f s a la ry t o determ ine th e f l a t grant. Three d i s t r i c t s used an a d m in is tr a t iv e decision t o s e t th e f l a t grant. For two o f t h e s e t h r e e d i s t r i c t s , t h e a d m i n i s t r a t i v e d e c i s i o n was made a t a m e e t i n g o f t h e superintendents of the co n stitu en t d is tr i c ts . For t h e o t h e r d i s t r i c t where an a d m i n i s t r a t i v e d e c i s i o n s e t s t h e amount o f t h e f l a t g r a n t , t h e amount had been s e t y e a r s ago and t h e y were u n s u r e o f I t s o r i g i n . This 81 I n f o r m a t i o n 1s r e p o r t e d 1n T a b l e 6. The methods used t o c a l c u l a t e t h e f l a t g r a n t s and t h e paym ents t o c o n s t i t u e n t d i s t r i c t s a r e r e p o r t e d In T a b l e 7 , which 1s a summary t a b l e o f t h e f l a t - g r a n t d i s t r i b u t i o n s y s ­ te m s by d i s t r i c t . V ariatio n s of th e s t a t e excess - c o s t d i s t r ib u t io n system. Tw enty- f o u r ISDs used an e x c e s s - c o s t d i s t r i b u t i o n s yst em t h a t v a r i e d from t h e e x c e s s - c o s t s y st em embodied w i t h i n t h e Michigan S p e c i a l E d u c a ti o n Rule s. Of t h e s e , 15 d i s t r i c t s v a r i e d 1n how a l l o w a b l e c o s t s w ere d e t e r m i n e d , 12 v a r i e d 1n t h e c a l c u l a t i o n o f r e c e i p t s , and 5 v a r i e d 1n t h e manner o f payment. These f i n d i n g s a r e r e p o r t e d 1n T a b l e 8. The 24 a l t e r n a t i v e e x c e s s - c o s t d i s t r i b u t i o n s y s t e m s 1n which t h e v a r i a t i o n from t h e e x c e s s - c o s t methods embodied w i t h i n t h e Michi gan S p e c i a l E d u c a t i o n R u le s I n v o l v e d d i f f e r e n c e s 1n d e t e r m i n i n g a l l o w a b l e c o s t s , c a l c u l a t i o n o f r e c e i p t s , and t h e manner o f payment a r e d i s c u s s e d below and a r e r e p o r t e d 1n T a b l e 9. Each o f t h e s e v a r i a t i o n s 1s p r e ­ s e n t e d and d e s c r i b e d . 1. V a r i a t i o n s 1n D e te rm in in g A llo w ab le C o s t s F i f t e e n o f t h e 24 ISDs used an a l t e r n a t i v e e x c e s s - c o s t d i s t r i b u ­ t i o n s y st e m t h a t d i f f e r e d from t h e s t a t e method f o r d e t e r m i n i n g a l l o w ­ able costs. Two o f t h e 15 d i s t r i c t s I n c lu d e d o n ly s t a f f s a l a r y and f r i n g e b e n e f i t s as t h e amount o f a l l o w a b l e c o s t s . The r e m a i n i n g 13 d i s t r i c t s used t h e s t a t e a l l o w a b l e - c o s t c a t e g o r i e s and d e f i n i t i o n s t h a t a r e I n c l u d e d on S t a t e Form DS 4096 (Appendix D), b u t v a r i e d by a d d i n g . l i m i t i n g , a n d / o r s u b t r a c t i n g c o s t s a l lo w e d by t h e s t a t e . T ab le 7*—Methods f o r d e t e r m i n i n g f l a t g r a n t s used by ISDs in Michigan d u r i n g t h e 1984-85 school y e a r . D istrict .. Code , Number F l a t - G r a n t U n it s Methods Used f o r C a l c u l a t i n g : m a .. d *. F l a t*.- Gn r a n *t. Amounts Payments 02 Classroom Amount o f fun ds a v a i l a b l e d i v i d e d by t h e number o f c l a s s r o o m programs Number o f c l a s s r o o m programs tim es f l a t - g r a n t amount 17 Professional s t a f f (FTE) Amount o f funds a v a i l a b l e d i v i d e d by t h e number o f p r o f e s s i o n a l s t a f f Number o f p r o f e s s i o n a l s t a f f ti m es f l a t - g r a n t amount Amount o f funds a v a i l a b l e d i v i d e d by t h e sum o f t h e p r o f e s s i o n a l s t a f f and a i d e s a l a r i e s t o equal a payout percentage 29 30 P r o f e s s ional s t a f f (FTE) T ot al sum o f p r o f e s s i o n a l s t a f f s a l a r i e s ti me s payo ut p e r c e n t a g e ( s e e above) d i v i d e d by t h e number of professional s t a f f Number o f p r o f e s s i o n a l s t a f f ti me s f l a t - g r a n t amount Aides (FTE) T ot al sum o f a i d e s ' s a l a r i e s times payout p e r c e n t a g e ( s e e above) d i v i d e d by t h e t o t a l number o f aides Number o f a i d e s ti m es f l a t g r a n t amount P r o f e s s ional F l a t - g r a n t amount s e t by admin­ is tr a tiv e decision Number o f p r o f e s s i o n a l s t a f f ti m es f l a t - g r a n t amount Tab le 7 . — C on tinued. D istrict Code .. , Number F l a t - G r a n t U n it s Methods Used f o r C a l c u l a t i n g : ^ ^ F l a t - G r a n t Amounts Payments ' 50 Classroom programs Amount o f funds a v a i l a b l e d i v i d e d by t h e number o f c l a s s r o o m programs Number o f c l a s s r o o m s times f l a t - g r a n t amount 51 Classroom programs Amoung o f funds a v a i l a b l e d i v i d e d by t h e number o f c l a s s r o o m programs Number o f c l a s s r o o m s ti me s f l a t - g r a n t amount Classroom programs ( i n i t i a l year) F l a t - g r a n t amount s e t by an admin­ is tr a t iv e decision Number o f c l a s s r o o m programs ( i n i t i a l y e a r ) ti me s t h e f l a t - g r a n t amount ( a d d i ­ tional grant) Aides a s s i g n e d by IEPC me eting F l a t - g r a n t amount s e t by an admin­ i s tr a tiv e decision Number o f IEPC-assigned a i d e s ti m es f l a t - g r a n t amount Classroom programs F l a t - g r a n t amount s e t by an admin­ is tr a tiv e decision Number o f c l a s s r o o m programs ti me s f l a t - g r a n t amount Classroom programs ( i n i t i a l year) F l a t - g r a n t amount s e t by an admin­ i s t r a t i v e d e c i s i o n (amount was a p p r o x i m a t e l y t h r e e ti me s l a r g e r f o r t h e 1984-85 school y e a r than g r a n ts fo r co ntinuing classroom programs) Number o f c l a s s r o o m programs in i n i t i a l y e a r ti me s f l a t g r a n t amount 55 co Ta b l e 8 . —A l t e r n a t i v e e x c e s s - c o s t d i s t r i b u t i o n sy stems used by ISDs d u r i n g t h e 1984-85 school y e a r . D i s t r i c t Code Number 01 07 1^ 16 18 20 23 24 X X X X X X 25 27 28 31 32 X X X X V a r i a t i o n ( s ) Used: Allow abl e c o s t s X X C alculating re c e ip ts X Manner o f payment X X X X X X D i s t r i c t Code Number 33 36 40 41 43 44 47 48 52 53 54 Totals V a r i a t i o n ( s ) Used: A llo w abl e c o s t s X C alculating re c e ip ts X X Manner o f payment X X X X X X X X 15 X 12 X 5 Table 9 - -- A 1 te r n a tiv e e x c e s s -c o s t methods used by ISOs d u rin g the 1984-85 school y e a r. D i s t r i c t Code Number 01 07 I* 16 18 20 23 26 25 27 28 31 32 33 X X X X 36 60 61 63 66 67 68 52 53 56 T0TAL Methods Used: A 1 lo w a b l e c o s t s * S t a t e OS 4096 Addi t i o n s A id e s PTNSEAP I n d ir e c t costs Room r e n t Ope r. & m a i n t . Gen. e d. adm in . L im its S u pplies 6 m a t e r ia l s C o n f./in s e rv ic e Lega l fe e s S u b t r a c t ion s Aides In d ir e c t costs S a la ry £ f r in g e s X X X X X X X X X X X X X X X X X X X X X X 22 4 1 3 4 2 2 X X X X X X X X X X X X X X X X X X 5 1 1 1 3 2 X X X X X X C a lc u la tio n o f r e c e ip ts 3 ^Membership s u b t r a c t i o n -GMA x FTE Minimum GMA x FTE GMA x S t d . S t . C t . GMA x head c o u n t ANRPS x FTE -C at. a id s u b tra c tio n R e c a p tu r e a d j u s t m e n t Res. d i s t . c o n t r i b u t i o n Manner o f payment " F u l1 s u p p o rt/1 i ke-percent S e l e c t e d pr ograms V a ry in g p ercentage P r i o r i t y sys tem Cas eload a d j u s t m e n t X X X X X X X X X X X X X X X X X X X X X X X X X X X X X X X X X X X X X X X X X X X X 1 xa X X X X X X X X X X X X X X X X X X X X xb x X X X X X X X X X X X 1 2 2! u 1 X X 19 1 X X 23 X X X X X X X X X X X X 20 1 X X X X X X X X X 4 3 1 PTNSEAP ■ P a r t - t i m e N o n - S p e c i a l - E d u c a t i o n A n c i l l a r y P e r s o n n e l , ANRPS * A c t u a l Net Revenue Per S t u d e n t , GMA * Gross Me mbership A l l o w a n c e , FTE ■ Number o f F u l l - T i m e E q u i v a l e n t S p e c i a l E d u c a t i o n S t u d e n t s , S t d . S t . C t . * S t a n d a r d S t u d e n t Count ^Method embodied i n t h e M i c h i g a n S p e c i a l E d u catio n R ules. aN o n r e s i d e n t s t u d e n t s o n l y . bNo c a t e g o r i c a l a i d s u b t r a c t i o n f o r c e n t e r p r o g r a m . 86 A d d i t i o n s t o s t a t e a l l o w a b l e c o s t s were g i v e n f o r : a. N on-state-approved a i d e s . C o s t s f o r c l a s s r o o m a i d e s a r e a l l o w e d by t h e s t a t e o n l y when t h e a i d e s a r e mandated by t h e Michigan S p e c i a l E d uc a ti o n R u le s, o r when a r e q u e s t f o r ap p r o v al has been s u b m i t t e d t o t h e s t a t e and a w a i v e r g r a n t e d . Four d i s t r i c t s had p r o c e d u r e s t h a t a l l o w e d f o r t h e c o s t s o f e m p lo y in g a i d e s n o t approved by t h e s t a t e 1n d e t e r m i n i n g a l l o w a b l e c o s t s . b. P a rt-tim e non-spec1al-educat1on a n c i lla r y personnel. One d i s t r i c t Included th e c o s t s of p a r t - t i m e non-spec1al-educat1on a n c i l l a r y p e r s o n n e l a s an a l l o w a b l e c o s t . I t s h o u ld be note d t h a t t h e c o s t s o f p a r t - t i m e n o n - s p e c 1 a l - e d u c a t 1 o n a n c i l l a r y p e r s o n n e l , such a s g e n e ra l e d u c a t i o n a r t t e a c h e r s , mu s ic t e a c h e r s , and p h y s i c a l ed uca ­ tion teachers, are not s ta te -a llo w a b le costs. The s t a t e ’s r a t i o n ­ a l e 1s t h a t 1f t h e a n c i l l a r y s e r v i c e 1s p r o v i d e d t o g e n e ra l e d u c a t i o n s t u d e n t s a s a r e g u l a r p a r t o f t h e e d u c a t i o n a l progr am, t h e s e r v i c e s h o u l d a l s o be p r o v i d e d t o s p e c i a l e d u c a t i o n s t u d e n t s , and no a d d i t i o n a l e x c e s s c o s t would be In v o lv ed . c. Indirect co sts. I n d i r e c t c o s t s a r e an an amount o f s t a t e - a l l o w a b l e c o s t f o r t h e o p e r a t i o n and m a i n t e n a n c e of f a c i l i t i e s . The s t a t e d e t e r m i n e s an I n d i r e c t c o s t r a t e f o r each l o c a l school d i s t r i c t by d i v i d i n g t h e t o t a l d i s t r i c t e x p e n d i t u r e s by t h e d i s t r i c t e x p e n d i t u r e s f o r o p e r a t i o n and m a i n t e n a n c e and school p l a n t p la n n in g . The I n d i r e c t c o s t r a t e , which t h e s t a t e l i m i t s t o a maximum o f 15%, 1s m u l t i p l i e d by t h e t o t a l program c o s t s t o d e t e r m i n e t h e amount o f t h e s t a t e - a l l o w e d I n d i r e c t c o s t s . Three 87 d i s t r i c t s I n c lu d e d a d d i t i o n a l am ounts beyond t h e amount a l l o w e d by the s t a t e fo r In d ire c t costs. d. Room r e n t . The s t a t e do es n o t p e r m i t d i s t r i c t s t o Include a c h a r g e f o r r e n t i n g t h e i r own f a c i l i t i e s a s an a l l o w a b l e c o s t . Four d i s t r i c t s I n c l u d e d an amount f o r r e n t o f c l a s s r o o m s p a c e 1n determining allowable c o s t s . * e. O p e r a t i o n and m a i n t e n a n c e . The s t a t e c o n s i d e r s th e In d irec t costs t o c o v e r e x p e n s e s f o r o p e r a t i o n and m a i n t e n a n c e and does n o t a l l o w a d d i t i o n a l c h a r g e s t o be I n c l u d e d a s a l l o w a b l e c o s t s , e x c e p t 1n p l a c e s where a d i s t r i c t 1s o p e r a t i n g a s e p a r a t e f a c i l i t y and docu­ m en ts t h a t I t s a c t u a l e x p e n d i t u r e s ex c e e d t h e s t a t e - a l l o w e d I n d i ­ r e c t costs. Two d i s t r i c t s I n c l u d e d an a l l o w a n c e f o r o p e r a t i o n and m a in te n a n c e a s an a l l o w a b l e c o s t . In bo th c a s e s , t h e I n d i r e c t c o s t s , a s a l lo w e d by t h e I n d i r e c t c o s t r a t e , w ere s u b t r a c t e d from t h e a llo w a b le cost. f. General e d u c a t i o n a d m i n i s t r a t i o n . The s t a t e does n o t a l l o w a d d i ­ tio n a l special education c o s ts fo r general education a d m in is tra ­ tion. The r a t i o n a l e 1s t h a t s p e c i a l e d u c a t i o n s t u d e n t s a r e p a r t of t h e t o t a l e d u c a t i o n program and t h a t g e n e r a l e d u c a t i o n a d m i n i s t r a ­ t i v e c o s t s a r e c o v e r e d by t h e b a s i c l e v e l o f s t a t e s u p p o r t g r a n t e d ^Payment of r e n t t o a d i s t r i c t f o r c l a s s r o o m s p u r c h a s e d and owned by a c o n s t i t u e n t d i s t r i c t began 1n t h e e a r l y p e r i o d o f P u b l i c Ac t 18 of 1954. During t h a t p e r i o d I t was common p r a c t i c e t o c o n s t r u c t and pay f o r c l a s s r o o m s w i t h "co unty s c h o o l d i s t r i c t s p e c i a l e d u c a t i o n m l l l a g e f un ds " 1n d i s t r i c t s w i t h a c l a s s r o o m s h o r t a g e . O th e r d i s t r i c t s w i t h a v a i l a b l e c l a s s r o o m s p a c e w e r e r e q u i r e d t o make such s p a c e a v a i l a b l e f o r needed programs. Thus, a s an e q u i t y m e a s u r e , r e n t was o f t e n p a i d t o t h o s e d i s t r i c t s s u p p l y i n g c l a s s r o o m s p a c e (Mange, 1985). 88 1n t h e g u a r a n t e e d g r o s s membership a l l o w a n c e . Two d i s t r i c t s Included a d d itio n a l allow ances fo r general education a d m in is tra tio n . L i m i t s t o s t a t e - a l l o w a b l e c o s t s were p l a c e d on e x p e n d i t u r e s f o r : a. S u p p l i e s and m a t e r i a l s . F i v e d i s t r i c t s l i m i t e d t h e amount of r e i m b u r s a b l e e x p e n d i t u r e f o r s u p p l i e s and m a t e r i a l s . b. C o n f e r e n c e s and 1 n s e r v 1 c e e d u c a t i o n . One d i s t r i c t l i m i t e d t h e amount o f r e i m b u r s a b l e e x p e n d i t u r e s f o r c o n f e r e n c e s and 1 n s e r v 1 c e education. c. Legal f e e s . One d i s t r i c t l i m i t e d t h e amount of r e i m b u r s a b l e ex penditures fo r legal fees. S u b t r a c t i o n s from s t a t e - a l l o w a b l e c o s t s were made f o r : a. State-approved aides. One d i s t r i c t s u b t r a c t e d t h e c o s t s o f non­ ma ndated a i d e s who had been approved by s t a t e w a i v e r from the allow able costs. b. Indirect c o sts. T h re e d i s t r i c t s s u b t r a c t e d t h e amount o f the s t a t e - a l l o w e d I n d i r e c t c o s t s from t h e a l l o w a b l e c o s t s . 2. V a r i a t i o n s 1n C a l c u l a t i o n o f R e c e i p t s Six d i s t r i c t s used d i f f e r e n t p r a c t i c e s f o r s u b t r a c t i n g s t a t e membership monies* e i g h t d i s t r i c t s used d i f f e r e n t p r a c t i c e s f o r s ub­ t r a c t i n g s t a t e c a t e g o r i c a l aid* and one d i s t r i c t used an a d d i t i o n a l s u b t r a c t i o n f o r a c o n t r i b u t i o n from a s t u d e n t ’s r e s i d e n t school d i s ­ trict. Two d i s t r i c t s us ed c o m b i n a t i o n s o f t h e s e p r a c t i c e s . The d i f f e r e n t p r a c t i c e s used f o r s u b t r a c t i n g s t a t e membership mon ies were: 89 a. No membership s u b t r a c t i o n . One d i s t r i c t d i d n o t s u b t r a c t any membership monies from t h e a l l o w a b l e c o s t s . b. Minimum g r o s s membership a l l o w a n c e t i m e s t h e number o f equivalent stu d e n ts. allowance. full-tim e One d i s t r i c t s e t a minimum g r o s s membership A l o c a l d i s t r i c t ' s a c t u a l g r o s s membership a l l o w a n c e o r t h e minimum g r o s s mem bersh ip allowa nce # w h ic h e v e r was g r e a t e r # was m u l t i p l i e d by t h e number o f f u l l - t i m e e q u i v a l e n t s t u d e n t s s e r v e d t o d e t e r m i n e t h e amount o f membership s u b t r a c t i o n . c. Gr oss membership a l l o w a n c e t i m e s a s t a n d a r d i z e d s t u d e n t head count. program. One d i s t r i c t e s t a b l i s h e d a s t a n d a r d head c o u n t by t y p e of For each c o r r e s p o n d i n g program type# t h e s t a n d a r d head c o u n t was m u l t i p l i e d by a c o n s t i t u e n t d i s t r i c t ' s g r o s s mem bersh ip a l l o w a n c e t o d e t e r m i n e t h e amount o f membership s u b t r a c t i o n . d. G ro ss membe r s h i p a l lowance times, t h e s t u d e n t head c o u n t . One d i s t r i c t m u l t i p l i e d a c o n s t i t u e n t d i s t r i c t ' s g r o s s membership a l l o w a n c e by t h e number o f n o n r e s i d e n t s t u d e n t s t o d e t e r m i n e t h e amount o f membership s u b t r a c t i o n f o r t h e n o n r e s i d e n t s t u d e n t s served. e. A c t u a l . n e t r e v e n g e p e r s t u d e n t t i m e s t h e number o f f u l l - t i m e equivalent students served. Two d i s t r i c t s used t h e amount o f a c o n s t i t u e n t d i s t r i c t ' s a c t u a l n e t revenue p e r s t u d e n t # e i t h e r t h e g r o s s membership a l l o w a n c e o r t h e amount r a i s e d by l o c a l p r o p e r t y t a x e s p e r s t u d e n t # w h ic h e v e r was g r e a t e r , t i m e s t h e number o f f u l l - t i m e e q u i v a l e n t s t u d e n t s t o d e t e r m i n e t h e amount o f t h e membership s u b t r a c t i o n . 90 The d i f f e r e n t p r a c t i c e s used f o r s u b t r a c t i n g s t a t e c a t e g o r i c a l a i d we re: a. No c a t e g o r i c a l a i d s u b t r a c t i o n . Three d i s t r i c t s did n o t s u b t r a c t c a t e g o r i c a l a i d f o r any pr o g ra m s , and one d i s t r i c t d id n o t s u b t r a c t c a t e g o r i c a l a i d f o r c e n t e r pr ograms. b. A d j u s t m e n t s t h a t w ere made f o r t h e amount r e c a p t u r e d by t h e s t a t e from o u t - o f - f o r m u l a l o c a l sc h o o l d i s t r i c t s bv r e d u c i n g t h e s p e c i a l e d u c a t i o n c a t e g o r i c a l a i d pa y m en ts . Four d i s t r i c t s a d j u s t e d t h e i r c a t e g o r i c a l a i d s u b t r a c t i o n s t o make up f o r p a r t o r a l l of w h a t t h e s t a t e had r e c a p t u r e d by r e d u c i n g t h e s p e c i a l e d u c a t i o n c a t e g o r i c a l a i d payment. One d i s t r i c t used an a d d i t i o n a l s u b t r a c t i o n o f a l o c a l c o n t r i b u ­ t i o n f o r s t u d e n t s s e r v e d 1n pr o gr am s a v a i l a b l e t o a l l c o n s t i t u e n t school d istricts ( c e n t e r p ro gr am s ) . T h i s d i s t r i c t s u b t r a c t e d 25% o f t h e p e r c a p i t a u n r e i m b u r s e d c o s t s from t h e p r e v i o u s y e a r as t h e amount of t h e lo cal d i s t r i c t c o n t r i b u ti o n . ( T h i s was t h e amount of t u i t i o n th e o p e r a t in g d i s t r i c t charged t h e r e s i d e n t d i s t r i c t per student.) 3. V a r i a t i o n s 1n t h e Manner of Payment F i v e ISDs used payment p r a c t i c e s t h a t d i f f e r e d from t h e s t a t e method. Of t h e s e f i v e d i s t r i c t s , one made a H k e - p e r c e n t payment f o r t h e a l l o w a b l e c o s t s o f o n l y s e l e c t e d p ro gr am s , and f o u r made a v a r y i n g p e r c e n t a g e payment t h a t d i f f e r e d by t y p e of program o r s e r v i c e , o r by an a d j u s t m e n t f o r t h e number of s t u d e n t s s e r v e d . The m a n n e r - o f - p a v m e n t p r a c t i c e s t h a t v a r i e d from t h e s t a t e method were: 91 a. L i k e - p e r c e n t payment f o r some pr o gr am s. One d i s t r i c t r e i m b u r s e d c o s t s 1n a l i k e - p e r c e n t payment o nl y f o r c o n s t l t u e n t - d l s t r i c t employed p s y c h o l o g i s t s # s o c i a l w o r k e r s , and sp ee ch t h e r a p i s t s . b. P r i o r i t y payment s y s t e m . T h r ee d i s t r i c t s d i s b u r s e d s p e c i a l e d u c a t i o n m l l l a g e f u n d s on t h e b a s i s o f where a s p e c i a l e d u c a t i o n program o r s e r v i c e had been a s s i g n e d w i t h i n a s e r i e s o f t h r e e o r more p r i o r i t i z e d r e im b u r s e m e n t l e v e l s . The programs and s e r v i c e s d e s i g n a t e d a s t h e h i g h e s t p r i o r i t y were p a i d f i r s t , h i g h e s t w ere p a i d , and so on. t h e n t h e n ext Th is p r a c t i c e r e s u l t e d 1n a v a r y i n g pa y ou t p e r c e n t a g e among programs. c. P r o p o r t i o n a t e c a s e l o a d payment s y s t e m . One d i s t r i c t s e t a minimum c a s e l o a d c o u n t p e r t y p e o f program and t h e n redu ce d t h e payment p e r c e n t a g e p r o p o r t i o n a t e l y , based on t h e e x t e n t t o which t h e h ig h ­ e s t c a s e l o a d c o u n t d u r i n g t h e school y e a r was under t h e minimum c a s e l o a d c o u n t s e t f o r t h e program. For t h o s e progr ams t h a t w er e u n d e r t h e minimum c a s e l o a d c o u n t , a r e d uc e d p e r c e n t a g e payment was made and r e s u l t e d 1n a v a r y i n g o v e r a l l payment p e r c e n t a g e . C l a s s i f y i n g t h e 24 a l t e r n a t i v e e x c e s s - c o s t payment s y s t e m s and t h e v a r i a n t p r a c t i c e s used by d i s t r i c t , a s can be s ee n 1n T a b l e 8, 1 t was discovered th a t: a. Nine d i s t r i c t s v a r i e d o n l y 1n d e t e r m i n i n g a l l o w a b l e c o s t s ; b. F iv e d i s t r i c t s v a r i e d o n ly 1n t h e d e t e r m i n i n g t h e c a l c u l a t i o n of recelpts; c. T h re e d i s t r i c t s v a r i e d o n ly 1n t h e manner o f payment; 92 d. F iv e d i s t r i c t s v a r i e d 1n d e t e r m i n i n g a l l o w a b l e c o s t s and t h e c a l ­ c u la tio n of re c e ip ts ; e. One d i s t r i c t v a r i e d 1n t h e c a l c u l a t i o n o f r e c e i p t s and t h e manner of payment; and f. One d i s t r i c t v a r i e d 1n a l l t h r e e components. The 24 a l t e r n a t i v e e x c e s s - c o s t d i s t r i b u t i o n s y s t e m s a r e r e p o r t e d 1n T a b l e 10# which 1s a summary t a b l e c o n t a i n i n g d e s c r i p t i o n s o f t h e methods used f o r d e t e r m i n i n g a l l o w a b l e c o s t s # c a l c u l a t i o n o f r e c e i p t s # and t h e manner o f payment# by ISD. P r o p o r t i o n a t e , g e n e r a l membership d i s t r i b u t i o n s y s t e m . One ISD ( D i s t r i c t 35) used a p r o p o r t i o n a t e g e n e r a l s t u d e n t mem bersh ip d i s t r i b u ­ t i o n sy stem t o d i s b u r s e s p e c i a l e d u c a t i o n m i l l age f u n d s t o c o n s t i t u e n t sch ool d i s t r i c t s . Th is d i s t r i b u t i o n method# which was used a f t e r t h e f u l l u n r e im b u r s e d c o s t s o f pro gr ams and s e r v i c e s a v a i l a b l e t o a l l c o n s t i t u e n t d i s t r i c t s had been paid# was c a l c u l a t e d a s f o l l o w s . 1. The t o t a l ISD s t u d e n t membership ( a g g r e g r a t e d mem bersh ip c o u n t s o f a l l c o n s t i t u e n t sc h oo l d i s t r i c t s ) was d i v i d e d by t h e s t u d e n t mem­ b e r s h i p c o u n t of each c o n s t i t u e n t sch oo l d i s t r i c t t o equal a pa y ou t percentage. 2. The t o t a l amount a v a i l a b l e f o r d i s t r i b u t i o n was m u l t i p l i e d by each c o n s t i t u e n t sch oo l d i s t r i c t ’ s pa yo ut p e r c e n t a g e t o d e t e r m i n e i t s r e s p e c t i v e amount o f payment. Weighted program c o s t d i s t r i b u t i o n s y s t e m . One ISD ( D i s t r i c t 11) used a w e i g h t e d program c o s t d i s t r i b u t i o n s y s t e m t o d i s b u r s e s p e c i a l e d u c a t i o n m l l l a g e funds t o c o n s t i t u e n t sc ho ol d i s t r i c t s . Th is T a b le 1 0 .— D e ta il o f v a r ia n t p r a c tic e s f o r d e te rm in in g a llo w a b le c o s ts , c a lc u la t io n o f D istrict Code i p t s , a n d /o r th e manner o f paym ent. Methods Used f o r D e t e r m i n i n g ; 3 Number A llo w a b le C osts C a lc u la tio n o f R e c e ip ts 01 S a l a r y and f r i n g e b e n e f i t s o f p s y ­ c h o l o g i s t s , s o c i a l w o r k e r s , and sp eech t h e r a p i s t s . No r e c e i p t s s u b t r a c t e d . Amount a v a i l a b l e d i v i d e d by t o t a l allow able c o s ts o f a l l c o n s titu e n t d i s ­ t r i c t s t o eq u al payo ut p e r c e n t a g e . For ea c h c o n s t i t u e n t d i s t r i c t , p ayo ut p e r ­ c e n t a g e m u l t i p l i e d by a l l o w a b l e c o s t s t o y i e l d amount o f payment. 07 S t a t e method w i t h t h e a d d i t i o n o f a l l o w i n g d i s t r i c t s t o u se u n r e ­ s t r i c t e d i n d i r e c t c o s t r a t e s and l i m i t s p l a c e d on e x p e n d i t u r e s f o r s u p p l i e s and m a t e r i a l s . S t a t e method. S t a t e method. 14 S t a t e method. S t a t e method. P r i o r i t y payment sy s tem wher e programs and s e r v i c e s wer e d i v i d e d i n t o one o f th re e p r i o r i t y groupings. F i r s t , f u ll s u p p o r t o r l i k e - p e r c e n t payment made f o r p r i o r i t y I g r o u p i n g s . As funds rem a in e d , f u l l S up po rt o r I I k e - p e r c e n t payment made f o r p r i o r i t y I I , e t c . 16 S t a t e method. S t a t e method f o r membership r e c e i p t s . No s u b t r a c t i o n f o r categ o rical a id . S t a t e method. 18 S t a t e method minus i n d i r e c t cost ra te . S t a t e method. S t a t e method. 20 S a l a r y and f r i n g e s o f s p e c i a l education s t a f f . S t a t e method use d w i t h t h e e x c e p t i o n t h a t a minimum g r o s s membership allow ance e s t a b l is h e d to c a l c u l a t e membership r e c e i p t s . S t a t e method. 23 S t a t e method w i t h a d d i t i o n o f up to $2,00 0 f o r i n d i r e c t c o s t s t h a t ex ceeded s t a t e 15% l i m i t . Used a c t u a l n e t r e v e n u e p e r s t u d e n t in c a l c u l a t i n g membership r e c e i p t s . S u b t r a c t e d o n l y n e t amount r e c e i v e d from s t a t e , which r e s u l t e d In p a r ­ t i a l repayment o f what s t a t e had r e c a p t u r e d from o u t - o f - f o r m u l a d istricts. S t a t e method. Manner o f Payment T a b le 1 0 .— C o n tin u e d . D istrict Hethods Used f o r D e te r m in in g : Code Number A llo w ab le C o s ts C a lc u la tio n o f R eceipts Manner o f Payment 24 S t a t e method w i t h a d d i t i o n s f o r room r e n t , o p e r a t i o n and m a i n ten an ce a l l o w a n c e , and g e n e r a l e d u c a t i o n ad m in istratio n . L im i t s p l a c e d on e x p e n d i t u r e s f o r s u p p l i e s and m a te ­ ria ls. I n d i r e c t c o s t s were s u b ­ tracted. S t a t e method. S t a t e method. 25 S t a t e method. S t a t e method minus r e s i d e n t d i s t r i c t c o n t r i b u ti o n fo r each s tu d e n t placed In a c e n t e r program. P r i o r i t y payment s y s te m where programs and s e r v i c e s wer e d i v i d e d i n t o one o f th re e p r i o r i t y groupings. F i r s t , f u ll s u p p o r t o r l i k e - p e r c e n t payment made f o r P r i o r i t y I g r o u p i n g . As fu nd s r em ain ed , f u l l s u p p o r t o r l i k e - p e r c e n t payment made f o r P r i o r i t y I I , e t c . 27 S t a t e method w i t h a d d i t i o n s f o r n o n - s t a t e - a p p r o v e d a i d e s , room r e n t , and o p e r a t i o n and m a i n t e n a n c e . I n d i r e c t c o s t s wer e s u b t r a c t e d . S t a t e method. S t a t e method. 28 S t a t e method w i t h l i m i t s p l a c e d on e x p e n d i t u r e s f o r s u p p l i e s and m aterials. S t a t e method. S t a t e method. 31 S t a t e method w i t h an a d d i t i o n f o r room r e n t . S t a t e method use d w i t h t h e e x c e p t i o n t h a t a d j u s t m e n t s wer e made f o r what had been r e c a p t u r e d by t h e s t a t e from o u t - o f - f o r m u l a d i s t r i c t s . S t a t e method. 32 S t a t e method w i t h s u b t r a c t i o n s made f o r s t a t e - a p p r o v e d non­ mandated a i d e s . S t a t e method. S t a t e method. 33 S t a t e method w i t h an a d d i t i o n f o r room r e n t . S t a t e method w i t h a s t a n d a r d i z e d s t u d e n t c o u n t by program t y p e used t o d e t e r m i n e membership s u b t r a c t i o n s . S t a t e method. 36 S t a t e method. S t a t e method use d w i t h t h e e x c e p t i o n t h a t t h e a c t u a l n e t rev en u e p e r s t u ­ d e n t was used t o c a l c u l a t e member­ ship re c e ip ts . S t a t e method. T a b le 1 0 .— C o n tin u e d . D istrict Code Number Methods Used f o r D e te r m in in g : A llo w a b le C osts C a lc u la tio n o f R e c e ip ts Manner o f Payment AO S t a t e method. S t a t e method. P r i o r i t y payment s y s te m where programs and s e r v i c e s wer e d i v i d e d i n t o one o f f iv e p r i o r i t y groups. F i r s t , f u ll sup­ p o r t o r l i k e - p e r c e n t payment made f o r P r i o r i t y I g r o u p i n g . As f u nd s rem ain ed , f u l l s u p p o r t o r l i k e - p e r c e n t payment made f o r P r i o r i t y I I , e t c . 41 S t a t e method w i t h a d d i t i o n s f o r non-state-approved a id e s . S t a t e method. S t a t e method. 43 S t a t e method. S t a t e method used w i t h t h e e x c e p t i o n t h a t a d j u s t m e n t s wer e made f o r what had been r e c a p t u r e d by t h e s t a t e from out-of-form ula d i s t r i c t s th at oper­ a t e d c e n t e r p rog ram s. S t a t e method. 44 S t a t e method. S t a t e method use d w i t h t h e e x c e p t i o n t h a t one FTE was use d f o r c a l c u l a t i n g n o n r e s i d e n t s t u d e n t m em berships, and c a t e g o r i c a l a i d was n o t s u b t r a c t e d f o r c e n t e r prog ram s. S t a t e method. \o in 47 S t a t e method. S t a t e method f o r membership r e c e i p t s . No s u b t r a c t i o n f o r s t a t e c a t e g o r i c a l aid . S t a t e method. 48 S t a t e method w i t h a d d i t i o n s f o r non­ s t a t e - a p p r o v e d a i d e s and l i m i t s p l a c e d on e x p e n d i t u r e s f o r s u p p l i e s and m a t e r i a l s , c o n f e r e n c e s and i n s e r v i c e s , and l e g a l f e e s . S t a t e method. S t a t e method. 52 S t a t e method w i t h l i m i t s p l a c e d on e x p e n d i t u r e s f o r s u p p l i e s and m aterials. S t a t e method. S t a t e method. 53 S t a t e method w i t h a d d i t i o n s f o r non­ s t a t e - a p p r o v e d a i d e s , p a r t - t i m e nonsp e cial -ed u catio n a n c iI la r y p erso n n el, i n d i r e c t c o s t s , and g e n e r a l e d u c a t i o n ad m in istratio n . S t a t e method use d w i t h t h e e x c e p t i o n t h a t a d j u s t m e n t s wer e made f o r what had been r e c a p t u r e d by t h e s t a t e from o u t - o f - f o r m u l a d i s t r i c t s t h a t o p e r a t e d c e n t e r pro gram s. S t a t e method. 54 S t a t e method. S t a t e method. S t a t e method use d e x c e p t t h a t minimum c a s e l o a d c o u n t s wer e e s t a b l i s h e d f o r e a c h program o r s e r v i c e ty p e and p ay ­ ments wer e p r o p o r t i o n a l l y red u ced t o th e e x te n t th a t th e h ig h e s t caseload amount o f t h e y e a r was u n der e s t a b 11 shed minimum. 96 d i s t r i b u t i o n method, which was used a f t e r t h e f u l l u n r e im b u r s e d c o s t s o f p r o g r a m s and s e r v i c e s a v a i l a b l e t o a l l c o n s t i t u e n t s ch oo l d i s t r i c t s had been p a i d , 1. was c a l c u l a t e d a s f o l l o w s . A program w e i g h t f a c t o r was d e t e r m i n e d . T h i s was done f o r each program l i s t e d on t h e s t a t e DS 4096 c o s t r e p o r t form (Appendix D) f o r a l l programs t h a t s e r v e d some, b u t n o t a l l , c o n s t i t u e n t s ch o o l d i s t r i c t s ( n o n c e n t e r p r o g r a m s ) . The w ei gh te d program f a c t o r s were d e t e r m in e d by: a. Adding t h e t o t a l program c o s t s , as l i s t e d on t h e o p e r a t i n g d is tric t's s t a t e DS 4096 c o s t r e p o r t form, f o r each program a c r o s s t h e ISD f o r t h e l a s t t h r e e y e a r s t o d e r i v e t h e t h r e e y e a r t o t a l c u m u l a t i v e c o s t s f o r each program; b. Adding t h e t o t a l number o f p r o f e s s i o n a l s t a f f members (FTE), a s l i s t e d on t h e o p e r a t i n g d i s t r i c t ' s s t a t e DS 4096 c o s t r e p o r t form, f o r each program a c r o s s t h e ISD f o r t h e l a s t t h r e e y e a r s t o d e r i v e t h e t h r e e - y e a r t o t a l c u m u l a t i v e FTE f o r each program; c. D i v i d i n g t h e t h r e e - y e a r t o t a l c u m u l a t i v e c o s t s f o r each program by t h e t h r e e - y e a r t o t a l c u m u l a t i v e FTE t o d e r i v e t h e t h r e e y e a r a v e r a g e program c o s t s p e r FTE f o r each program. The same p r o c e d u r e was used t o d e r i v e t h e t h r e e - y e a r a v e r a g e p ro ­ gram c o s t s p e r FTE f o r a l l p r o g ra m s ; t h e t h r e e - y e a r a v e r a g e program c o s t s p e r FTE f o r each program was d i v i d e d by t h e t h r e e - y e a r a v e r a g e program c o s t s f o r a l l pr og ram s t o d e r i v e t h e program w e i g h t f a c t o r f o r each program. 97 2. The amount o f each d i s t r i b u t i o n u n i t was d e t e r m i n e d . T h i s was c a l c u l a t e d by: a. M u l t i p l y i n g t h e c u r r e n t FTE f o r each program by t h e program w e i g h t f a c t o r t o d e r i v e t h e d i s t r i b u t i o n w e i g h t f o r each program; b. Summing t h e d i s t r i b u t i o n w e i g h t s f o r a l l programs t o d e r i v e t h e t o t a l number o f d i s t r i b u t i o n w e i g h t s ; and c. D i v i d i n g t h e fu nd s a v a i l a b l e f o r d i s t r i b u t i o n by t h e t o t a l number of d i s t r i b u t i o n w e i g h t s t o equal t h e amount o f a d is trib u tio n unit. 3. For each c o n s t i t u e n t sc ho ol d i s t r i c t * t h e t o t a l number o f d i s t r i b u ­ t i o n u n i t s was d e t e r m i n e d . a. T h i s was c a l c u l a t e d by: M u l t i p l y i n g t h e c u r r e n t FTE f o r each program by t h e r e s p e c t i v e p r o g r a m - w e l g h t f a c t o r t o equal t h e number o f d i s t r i b u t i o n u n i t s f o r each pr ogram; and b. Summing t h e d i s t r i b u t i o n u n i t s f o r each program t o equa l t h e t o t a l number of d i s t r i b u t i o n u n i t s . 4. The t o t a l number o f d i s t r i b u t i o n u n i t s f o r each c o n s t i t u e n t d i s ­ t r i c t was m u l t i p l i e d by t h e amount o f a d i s t r i b u t i o n u n it * which equaled th e d i s t r i c t s r e s p e c t i v e r e i m b u r s e m e n t from t h e s p e c i a l e d u c a t i o n m l l l a g e fund. S u b s i d i a r y Q u e s t i o n 2 b . How do t h e d i f f e r e n t t y p e s o f a l t e r n a t i v e methods used by ISDs f o r d i s t r i b u t i n g s p e c i a l e d u c a t i o n m l l l a g e fu nds r e l a t e t o t h e s y s t e m o f e q u i t a b l e d i s t r i b u t i o n embodied w i t h i n R u l e 3 4 0 . 1 81 1* s u b r u l e s (2)* (3)» a nd ( 4 ) ? 98 Findings. The sy ste m o f e q u i t a b l e d i s t r i b u t i o n embodied w i t h i n t h e Michigan S p e c i a l E d u c a t i o n R u le s f o r d i s b u r s i n g s p e c i a l e d u c a t i o n m l l l a g e fun ds t o c o n s t i t u e n t school d i s t r i c t s 1s an e x c e s s - c o s t d i s t r i ­ b u t i o n s ys te m t h a t 1s based on a f u l 1 - s u p p o r t o r a H k e - p e r c e n t payment t o a l l c o n s t i t u e n t school d i s t r i c t s f o r t h e i r u n r e i m b u r s e d a d d i t i o n a l c o s t s f o r p r o v i d i n g s p e c i a l e d u c a t i o n pro gr ams and s e r v i c e s . Under­ s t a n d i n g t h e t e r m s " s t a t e a l l o w a b l e c o s t s , " " s t a t e e x c e s s c o s t s , " and " u n r e i m b u r s e d c o s t s " 1s I m p o r t a n t f o r com p re h en di n g t h e c o n c e p t s t o be presented. Each t e r m r e f e r s t o a d i f f e r e n t , though r e l a t e d , amount of a d i s t r i c t ' s e x p e n d i t u r e s f o r p r o v i d i n g s p e c i a l e d u c a t i o n p r og r am s and services. The t o t a l e x p e n d i t u r e s f o r s p e c i a l e d u c a t i o n p r o g r a m s and s e r v i c e s , a s p e r m i t t e d by a s p e c i f i c s e t o f s t a t e c a t e g o r i e s and d e f i ­ n i t i o n s (DS 4096), 1s t e r m e d t h e s t a t e a l l o w a b l e c o s t s . The s t a t e a l l o w a b l e c o s t s minus t h e s t a t e membership a i d r e c e i v e d f o r t h e s p e c i a l e d u c a t i o n program, g r o s s membership a l l o w a n c e (GMA) t i m e s t h e number of f u l l - t i m e e q u i v a l e n t (FTE) s p e c i a l e d u c a t i o n s t u d e n t s , s t a t e excess costs. 1s t e r m e d t h e The s t a t e e x c e s s c o s t minus t h e s t a t e s p e c i a l e d u c a t i o n c a t e g o r i c a l a i d 1s te rm e d t h e u n r e i m b u r s e d c o s t s . t i o n s h i p among t h e s e t h r e e t e r m s 1s shown below. T ot al S t a t e All ow abl e C o s ts - S t a t e Membership Aid________ S t a t e Exce ss C o s ts S t a t e Exce ss C o s t s - S t a t e C a t e g o r i c a l Aid___________ Unreimbursed ( a d d i t i o n a l ) C o s t s The r e l a ­ 99 As shown above, t h e t e r m " u n r e i m b u rs e d c o s t s " r e f e r s t o t h e a d d i ­ t i o n a l c o s t s f o r p r o v i d i n g s p e c i a l e d u c a t i o n p ro g ram s and s e r v i c e s a f t e r t h e s t a t e mem bersh ip and c a t e g o r i c a l a i d have been s u b t r a c t e d and b e f o r e t h e ISD s p e c i a l e d u c a t i o n m l l l a g e f u n d s have been d i s t r i b u t e d . E qu it y 1n t h e s t a t e e x c e s s - c o s t d i s t r i b u t i o n s y s t e m 1s e s t a b l 1s h e d .b y t h e c o n d i t i o n t h a t t he amount o f t h e payment made t o one c o n s t i t u e n t sch oo l d i s t r i c t 1s t o be t h e same p r o p o r t i o n ( 1 1 k e - p e r c e n t ) o f I t s u n r e i m b u r s e d c o s t s a s t h e amount o f payment made t o each o t h e r con­ s t i t u e n t d i s t r i c t . (See d e f i n i t i o n and e x p l a n a t i o n o f t h e t e r m " e q u i t y " 1n C h a p t e r I , p. 6 . ) An exam ple o f t h e s t a t e e x c e s s - c o s t s ys te m 1s p r e s e n t e d 1n T a b l e 11 f o r a s i m p l i f i e d and h y p o t h e t i c a l ISD c o m p r i s i n g t h r e e c o n s t i t u e n t sch ool d i s t r i c t s . In t h i s e x am pl e, t h e p r o p o r t i o n o f t h e payment made t o t h e u n r e im b u r s e d c o s t s 1s 50% f o r a l l c o n s t i t u e n t sch ool d i s t r i c t s . For each of t h e f o u r d i f f e r e n t t y p e s o f s p e c i a l e d u c a t i o n m i l l a g e d 1 s t r 1 b u t 1 o n s y s t e m s p r e s e n t e d un d er S u b s i d i a r y Q u e s t i o n 2 a, t h e v a r y ­ i n g p r a c t i c e s a r e examined and d i s c u s s e d a s t h e y a f f e c t e q u i t y 1n t h e d i s t r i b u t i o n of s p e c i a l e d u c a t i o n m l l l a g e fu nd s. The d a t a p r e s e n t e d 1n T a b l e 11 w i l l be used t o a s s i s t 1n t h e d i s c u s s i o n . F la t g ran t d i s t r i b u t i o n systems. In a f l a t - g r a n t d i s t r i b u t i o n s y s t e m , t h e same d o l l a r amount 1s p a i d f o r each o f a number o f s p e c i ­ fied d is trib u tio n units. The amount of u n r e i m b u r s e d c o s t s expended by c o n s t i t u e n t school d i s t r i c t s 1s n o t r e c o g n i z e d by t h i s d i s t r i b u t i o n method. For example, D i s t r i c t X and D i s t r i c t Y expend $12,000 and $4,000, r e s p e c t i v e l y , o f u n r e i m b u r s e d c o s t s f o r a c l a s s r o o m program. 100 T a b le 1 1 . - - H y p o t h e t i c a l example o f t h e R u le 3 ^ 0 . 1 8 1 1 , s u b r u l e s ( 2 ) , ( 3 ) , and ( A ) , sy ste m f o r r e im b u r s e m e n t o f s p e c i a l e d u c a t i o n c o s t s t o c o n s t i t u e n t d i s t r i c t s . D istrict A D istrict 2,500 $2,200 Memb GMA B D istrict 2,000 $2,000 C 1 , 000 $2 , 500 Prog Prof/Stu Total Costs (DS A096) Prof/Stu Total Costs (DS A096) Prof/Stu Total Costs (DS A096) EMI El LD 3.0/33.0 0.0 / 0.0 2.0/12.0 $ 85,000 $ 0 $ 65,000 1.0/12.0 2.0/1A.0 1.0/ 8.0 $ 25,000 $ 60,000 $ 35,000 1.0/11 .0 0 .0 / 0.0 1.0/ 7.0 $ 25,000 $ 0 $ 35,000 T o t a 1s 5.0/A5.0 $ 150, 000 A.0/3A.0 $1A0 , 000 2.0/18.0 $ 60,000 S t a t e Membership R e c e i p t s State Dist Stu x GMA » S t a t e Memb Receipts A A5. 0 3A. 0 18 . 0 x x x $2,200 $2,000 $2,500 = «= $99,000 $68,000 $A5, 000 B C S tate Categorical Dist A B C Excess Costs $51,000 $72,000 $15,000 * X X x 15% 15% 15% Total Costs (DS A096) S t a t e Memb Receipts $150,000 $1A0, 000 $ 60,000 $99,000 $68,000 $A5, 000 Ai d Pet S t a t e Re i mb = = Excess Costs Excess Costs = = - $51,000 $ 72,000 $15,000 Unreimbursed Costs State C a t Ai d Excess Costs $ 7,650 $ 1 0 ,8 0 0 $ 2.250 $5 1 , 0 0 0 $72,000 $ 15,000 - State Ca t Ai d m Unreimb Costs $ 7,650 $10,800 $ 2,250 = - $A3, 3 5 0 $61,200 $12,750 C a l c u l a t i o n o f L i k e - P e r c e n t Payment Amount A v a ila b le , T o t a l Un reim b C o s ts m L ik e -P e rc e n t Payment $ 58,650 / $117,300 = 50 % D i s t r i b u t i o n o f S p e c ia l S t a t e D i s t r i b u t i o n Method E d u ca tio n H i l l a g e D is tric t A Funds D is tric t B D is tric t T o t a l A l l o w a b l e C o s ts (DS A096) M in us S t a t e Memb R e c e i p t s M in us S t a t e Cat A id R e c e i p t s $ 1 5 0 ,0 0 0 -99 ,0 0 0 - 7,650 $ 1 A0 ,0 0 0 -6 8 ,0 0 0 -1 0 ,8 0 0 $ 60,000 -It5 ,0 0 0 - 2 ,250 E q u a ls T o t a l U n r e im b u r s e d C ost Times L i k e - P e r c e n t o f Payment $ A 3 ,3 5 0 x .5 0 $ 61,200 x.5 0 $ 1 2 ,7 5 0 x ■50 E q u a ls Amount o f Reim bursement $ 21,675 S 30,600 $ 6,375 C 101 I f t h e ISD r e i m b u r s e s a f l a t g r a n t o f $4,000 p e r c l a s s r o o m program* t h e r e m a i n i n g u n r e i m b u r s e d c o s t f o r D i s t r i c t X 1s $8,000 and f o r D i s t r i c t Y t h e amount 1s 0. No a d j u s t m e n t 1s made f o r t h e v a r y i n g c o s t s o f p r o ­ v i d i n g s p e c i a l e d u c a t i o n p r o g r a m s and s e r v i c e s . D istrict X Amount o f Unreimbursed C o s t s Amount o f ISD Payment ( $ 4 ,0 0 0 x 1) Rem aining U nr eim bu rs ed C o s t s For t h e same s i t u a t i o n , D istrict 1 Totals 1 2, 00 0 -4,000 4,000 -4,000 16,000 -8,000 8,000 0 8,000 using t h e s t a t e e x c e ss -c o s t d i s t r i b u t i o n s y s t e m , f u n d s would be d i s b u r s e d a s f o l l o w s (as suming t h e same amount 1s a v a i l a b l e f o r d i s t r i b u t i o n ) : D istrict X PJ s t r i c t 1 Totals Amount o f U n rei mb ur se d Times L i k e P e r c e n t Amount o f Payment Costs 12,000 __ &5.Q 6,000 4,000 , X.5Q 2,000 16,000 &»5fl 8,000 Rem aini ng U nr ei m bu rs ed C osts 6,000 2,000 8,000 To d e t e r m i n e t h e e x c e s s c o s t s t o e d u c a t e ha n di ca pp ed c h i l d r e n , t h e s t a t e s u b t r a c t s t h e amount g u a r a n t e e d t o t h e d i s t r i c t f o r t h e e d u c a t i o n o f a l l s t u d e n t s ( g r o s s me m be rs hi p a l l o w a n c e ) . T h i s 1s done t o ba s e t h e amount o f r e i m b u r s e m e n t on t h e c o s t s 1n e x c e s s o f t h e b a s i c amount g u a r a n t e e d f o r a l l s t u d e n t s ( I n c l u d i n g ha n d i c a p p e d c h i l d r e n ) e n r o l l e d 1n t h e d i s t r i c t . The f l a t - g r a n t d i s t r i b u t i o n sy ste m does n o t c o n t a i n p r o c e d u r e s t h a t a c c o u n t f o r d i f f e r e n c e s 1n t h e a c t u a l u n r e im b u r s e d costs. As a r e s u l t , some d i s t r i c t s a r e r e i m b u r s e d a h i g h e r p r o p o r t i o n of t h e i r u n r e i m b u r s e d c o s t s and o t h e r s a r e r e i m b u r s e d a l o w e r 102 pro p o rtio n of t h e i r unrelmbursed c o s ts . An e x a m p le 1s g i v e n f o r D is ­ t r i c t X, where t h e g r o s s membership a l l o w a n c e 1s $2,000, and D i s t r i c t Y, where t h e g r o s s membership a l l o w a n c e 1s $2,500. Other s i m i l a r ex am ple s c o u l d be c o n s t r u c t e d w he r e program e x p e n d i t u r e s v a r y , b u t s u p p o r t 1s equal t o a n d / o r c o m b i n a t i o n s o f t h e above. The f o l l o w i n g I l l u s t r a t i o n 1s p r e s e n t e d f o r one c l a s s r o o m w i t h e i g h t s t u d e n t s (FTE) e n r o l l e d f o r each d i s t r i c t . D istrict X D istrict Y T o t a l Cos ts (DS 4096) Minus Gross Membership A llo w anc e (x’s 8) T o t a l S t a t e Ex cess C o s ts (SEC) 25,000 - 1 6 ,0 0 0 9,000 25,000 - 2 0 ,0 0 0 5,000 Minus S t a t e C a t e g o r i c a l Aid (15% o f SEC) Equa ls T o t a l Unre lmbu rs ed Co s ts -1,350 7,650 -7 50 4,250 Minus F l a t G r a n t Payment ($4,000 x 1) E qu al s Remaining Unre lmbu rs ed Co s ts -4,000 3,650 -4,000 250 52% 94% P e r c e n t of Unre lmbu rs ed C o s t s P ai d As shown 1n t h e p r e c e d i n g ex am pl e, both D i s t r i c t s X and Y expend t h e same amounts. However, b e c a u s e t h e g r o s s mem bersh ip a l l o w a n c e 1s n o t a c c o u n te d f o r 1n t h e f l a t - g r a n t d i s t r i b u t i o n s y s t e m , D i s t r i c t X 1s p a i d 52% o f I t s t o t a l u n r e lm b u r s e d c o s t s and D i s t r i c t Y 1s p a i d 94% o f I t s t o t a l unrelmbursed co sts. For a f l a t - g r a n t d i s t r i b u t i o n s y s t e m , where t h e s t u d e n t c o u n t (FTE) 1s h e l d c o n s t a n t , th e la r g e r th e gross membership a l l o w a n c e t h e g r e a t e r t h e p e r c e n t a g e o f t o t a l u n r e l m b u r s e d c o s t s t h a t a r e pai d. In s h o r t , t h o s e d i s t r i c t s t h a t r e c e i v e more p e r 103 p u p i l a i d ( h i g h e r GMA) a r e r e q u i r e d t o pay l e s s (1n p r o p o r t i o n t o th e ir total u n r e l m b u r s e d c o s t s ) und er a f l a t - g r a n t d i s t r i b u t i o n sy ste m . The s p e c i f i c method by which a f l a t - g r a n t amount 1s d e t e r m i n e d 1s o f l e s s con se qu en c e t h a n t h e q u e s t i o n o f e q u i t a b l e d i s t r i b u t i o n . In g e n e r a l# each year# and d e f i n i t e l y 1n t h e lo n g run# a c e r t a i n amount o f fu nd s 1s a v a i l a b l e f o r d i s t r i b u t i o n . T h i s a v a i l a b l e amount 1s p a r t i ­ t i o n e d I n t o t h e number of d i s t r i b u t i o n u n i t s . I f a f l a t - g r a n t system 1s t o be used# t h e most e f f i c i e n t way 1s t o d i v i d e t h e amount a v a i l a b l e by t h e number of d i s t r i b u t i o n u n i t s t o d e t e r m i n e t h e amount o f t h e f l a t grant. In t h i s r e s e a r c h e r ’s opinion# o t h e r me thods a r e s i m p l y l e s s e f f i c i e n t ways o f a r r i v i n g a t t h e amount o f t h e f l a t g r a n t . S e l e c t i o n o f t h e d i s t r i b u t i o n u n 1 t ( s ) w i l l I n f l u e n c e t h e amount o f payment (d epe ndi ng on how many o f t h e s p e c i f i e d u n i t s a d i s t r i c t h as ) and may I n f l u e n c e t h e d e g r e e o f e q u i t y In t h e d i s t r i b u t i o n o f fu n d s . For example# d i s t r i b u t i n g a l a r g e r o r a d d i t i o n a l amount f o r new c l a s s r o o m pr o gr am s r e c o g n i z e s t h a t a d d i t i o n a l e x p e n d i t u r e s a r e r e q u i r e d t o s t a r t a program. Likewise# d i s t r i b u t i n g a f l a t g r a n t f o r c l a s s r o o m pr og r am s and f o r a i d e s r e c o g n i z e s t h a t a d d i t i o n a l e x p e n d i t u r e s a r e r e q u i r e d t o employ a i d e s . However# t h e I n t e r a c t i o n s o f t h e u n i t s do n o t produ ce c o n s i s t e n t a d d i t i o n a l c o s t s a c r o s s a l l pr og r am s and s e r v ­ ices. I f t h e u n i t s w ere c o n s i s t e n t l y d i s t r i b u t e d a c r o s s a l l con­ s t i t u e n t school d i s t r i c t s # and 1f t h e u n r e l m b u r s e d c o s t f o r each u n i t w e r e I d e n t i c a l # t h e f l a t - g r a n t d i s t r i b u t i o n s y s t e m would p r odu ce a high d e g r e e o f e q u i t y among t h e s e l e c t e d u n i t s . would be r a r e t o f i n d t h e I d e n t i c a l However# 1n a c t u a l i t y 1 t u n r e l m b u r s e d c o s t s f o r two u n i t s 104 w i t h i n t h e same d i s t r i c t , and 1 t would be p r a c t i c a l l y I m p o s s i b l e t o f i n d d u p l i c a t e u n r e l m b u r s e d c o s t s a c r o s s an ISD. As d i s c u s s e d above, t h e f l a t - g r a n t d i s t r i b u t i o n s y s t e m f o r d i s ­ b u r s i n g s p e c i a l e d u c a t i o n m l l l a g e fu n ds p r o d u c e s c o n s i d e r a b l e I n e q u i ­ t i e s 1n t h e am oun ts r e i m b u r s e d among c o n s t i t u e n t sc ho ol d i s t r i c t s . T h i s 1s f u r t h e r s u p p o r t e d by t h e f i n d i n g s shown 1n T a b l e 12, which g i v e s a c o m p a r i s o n o f t h e s t a t e e x c e s s - c o s t d i s t r i b u t i o n s y st e m and a f l a t - g r a n t d i s t r i b u t i o n s y st e m f o r a h y p o t h e t i c a l ISD c o m p r i s i n g t h r e e c o n s t i t u e n t school d i s t r i c t s . In t h i s ex am p le, D i s t r i c t A 1s pa i d 61% o f I t s u n r e l m b u r s e d c o s t s . D i s t r i c t B 1s p a i d 35% o f I t s u n r e lm b u r s e d c o s t s , and D i s t r i c t C 1s p a i d 84% o f I t s u n r e l m b u r s e d c o s t s . For ISDs t h a t u s e a f l a t - g r a n t d i s t r i b u t i o n s y s t e m , some d i s t r i c t s would be r e w a r d e d by r e c e i v i n g a g r e a t e r p o r t i o n o f t h e i r u n r e l m b u r s e d c o s t s and o t h e r s would be p e n a l i z e d by r e c e i v i n g a s m a l l e r p o r t i o n o f t h e i r u n r e l m b u r s e d c o s t s t h a n t h e y would un de r t h e s t a t e e x c e s s - c o s t d i s t r i b u t i o n system. In g e n e r a l , d i s t r i c t s would be f i n a n c i a l l y r e w a r d e d 1n t h e d i s t r i b u t i o n o f s p e c i a l e d u c a t i o n m l l l a g e f u n d s un d er a f l a t - g r a n t d i s t r i b u t i o n s y st em compared t o t h e s t a t e e x c e s s - c o s t d i s ­ t r i b u t i o n 1f t h e y : 1. Employed l e s s - e x p e r i e n c e d and l o w e r - s a l a r i e d t e a c h e r s , 2. Expended l e s s on t e a c h i n g s u p p l i e s and m a t e r i a l s , and 3. Had a high g r o s s membership a l l o w a n c e . 105 T a b l e 12.— Comparison a n a l y s i s o f c o n s t i t u e n t d i s t r i c t r e i m b u r s e m e n t under Rule 3 4 0 . 1 8 1 1 , s u b r u l e s ( 2 ) , (3) and ( 4 ) , and a f l a t g r a n t sy ste m . Pi s t r i c t A D istrict B D istrict C T ot al Unrelmbursed C o s t s Times Like P a y o u t _ P e r c e n t Amount of Reimbursement $43,350 x.50 $21,675 $61,200 x.50 $30,600 $12,750 x.50 $ 6,375 P e r c e n t Unrelmbursed C o s ts 50% 50% 50% Un relmbursed C o s t s $43,350 $61,200 $12,750 Amount of F l a t G ran t G r a n t x U n i t s (Prof/Rms) Amount of Reimbursement $ 5,331 x5 $26,655 $ 5,331 ...... . x4 $21,324 $ 5,331 x2 $10,662 61% 35% 84% T ot al Unrelmbursed C o s t s 0 0 0 Amount o f Reimb urs eme nt + $4,980 - $ 9,276 + $4,287 +11% -15% +34% S t a t e Excess Co st Svstem F l a t - G r a n t D i s t r i b u t i o n Svstem Tot al P e r c e n t Unrelmbursed C o s t s D i f f e r e n c e s Between Systems P e r c e n t Un relmbursed C o s t s C a l c u l a t i o n o f F l a t - G r a n t Amount A v a i l a b l e S p e c i a l E d u c a ti o n M l l l a g e Funds D ivi de d by Number of U n i t s (Prof/Rooms) $58,650 11 Equal s t h e Amount o f Each F l a t G ra nt $ 5,331 106 Conversely* d i s t r i c t s would be f i n a n c i a l l y p e n a l i z e d 1f t h e y : 1. Employed more e x p e r i e n c e d and h i g h e r s a l a r i e d t e a c h e r s * 2. Expended more on t e a c h i n g s u p p l i e s and m a t e r i a l s * and 3. Had a low g r o s s membership a l l o w a n c e . P e r h a p s t h e primary r e a s o n f o r use o f a f l a t - g r a n t d i s t r i b u t i o n system are: 1. S i m p l i c i t y and e a s e o f c a l c u l a t i o n , 2. Ease o f u n d e r s t a n d i n g of t h e s yst em by c o n s t i t u e n t s ch oo l d i s ­ tricts, 3. and Prior practice. The f l a t - g r a n t s ys te m does, however, s a c r i f i c e t h e p r i n c i p l e o f e q u i t y t o v a r y i n g d e g r e e s and, a s s u ch , e x a c t s a p r i c e from some c o n s t i t u e n t d i s t r i c t s w hile supporting o th e rs d isp ro p o rtio n ately . V a ria tio n s of th e s t a t e e x c e ss -c o s t d i s t r i b u t i o n svstem. The a c t u a l t y p e s o f p r a c t i c e s found t o d i f f e r from t h e s t a t e e x c e s s - c o s t d i s t r i b u t i o n s ys te m me th o ds f o r d e t e r m i n a t i o n o f a l l o w a b l e c o s t s , c a l ­ c u la tio n of re c e ip ts , and t h e manner o f payment a r e p r e s e n t e d below 1n t h e same o r d e r shown on T a b l e 8. These p r a c t i c e s a r e d i s c u s s e d a s th e y may r e s u l t 1n v a r y i n g d e g r e e s o f a t t e n u a t i o n 1n e q u i t y . Although t h e d i s c u s s i o n 1s f o c u s e d on e q u i t y r a t h e r t h a n l e g a l i t y , t h e l e g a l c o n s i d ­ e r a t i o n s a r e s t r a i g h t f o r w a r d and m e r i t b r i e f mention. I f any p r a c t i c e l i s t e d below was used by an ISD and 1 t was n o t I n c l u d e d a l o n g w i t h t h e r e a s o n s f o r so u s i n g w i t h i n t h e d i s t r i c t ' s approv ed s p e c i a l e d u c a t i o n p l a n , t h e p r a c t i c e was s i m p l y I l l e g a l . 107 1. V a r i a t i o n s 1n D e te r m in in g A llo w ab le C o s ts Elev en p r a c t i c e s v a r i e d by adding# l i m i t i n g # o r s u b t r a c t i n g from c o s t s a l l o w e d by t h e s t a t e . tions# Of t h e s e 11 p r a c t i c e s # t h r e e Involved l i m i t a t i o n s # s i x Involved addi­ and t w o I n v o l v e d s u b t r a c t i o n s . One o t h e r v a r i a t i o n was used# which was t h e p r a c t i c e o f s u b s t i t u t i n g s t a f f members’ s a l a r y and f r i n g e b e n e f i t s a s t h e a l l o w a b l e c o s t s . The p r a c t i c e s w he re n o n - s t a t e - a p p r o v e d c o s t s w ere added t o a con­ s t i t u e n t d i s t r i c t ' s a l l o w a b l e c o s t s were; a. N on-state-approved a id e s . Some ISDs I n c l u d e d t h e c o s t s o f a i d e s who w e r e n o t ap pr o ve d by t h e s t a t e f o r r e i m b u r s e m e n t . The r e s e a r c h e r had no means t o d e c i d e w h e t h e r t h e a d d i t i o n a l a i d e s w ere r e a l l y n e c e s s a r y o r 1 f each c o n s t i t u e n t sch ool d i s t r i c t w i t h i n an ISD t h a t employed t h i s p r a c t i c e was a l l o w e d an equal o p p o r t u n i t y t o Include th e c o s ts fo r non-state-approved aides. on t h e e q u i t y o f t h i s b. Thus# no p o s i t i o n p r a c t i c e 1s ta k e n . P a rt-tim e non-state-approved a n c illa r y personnel. The same r a t i o n a l e would a p p l y a s g iv e n above f o r n o n - s t a t e - a p p r o v e d a i d e s . No p o s i t i o n 1s t a k e n on t h e e q u i t y o f t h i s p r a c t i c e . c. In d irec t costs. T h r e e ISDs I n c l u d e d a d d i t i o n a l amounts f o r o p e r a ­ t i o n and m a i n t e n a n c e and sc ho ol p l a n t p la n n in g . In t h e t h r e e p l a c e s where t h i s p r a c t i c e was used# a l l I n v o l v e d a c t u a l e x p e n d i ­ t u r e s t h a t ex ce ed ed t h e s t a t e I n d i r e c t c o s t r a t e l i m i t o f IS* o f t h e t o t a l program c o s t s . Some would a r g u e t h a t any a d d i t i o n a l e x p e n d i t u r e s beyond t h e s t a t e l i m i t f o r I n d i r e c t c o s t s a r e a c t u a l e x p e n s e s and s h o u ld be a l lo w e d . O t h e r s would say t h a t no 108 additional e x p e n d i t u r e s have* 1n fa c t * o ccu rr ed * a s t h e c o s t s would have been t h e r e w i t h o r w i t h o u t t h e s p e c i a l e d u c a t i o n p ro g ra m (s ). Both a r g u m e n t s have m e r i t . One m i g h t even q u e s t i o n t h e e q u i t y o f t h e s t a t e p r a c t i c e o f l i m i t i n g t h e I n d i r e c t r a t e t o 15%. t h e e f f e c t o f t h i s p r a c t i c e on e q u i t y 1s u n c l e a r * Although 1 t 1s l i k e l y t o r e s u l t 1n r e l a t i v e l y m i n o r v a r i a t i o n s 1n t h e e q u i t a b l e d i s t r i b u t i o n of funds. d. Room r e n t . The payment f o r r e n t a l o f rooms t o hou se s p e c i a l educa­ t i o n pr ograms 1s an a r t i f a c t o f p a s t p r a c t i c e s . H istorically* ISDs p a i d f o r c o n s t r u c t i o n o f s p e c i a l e d u c a t i o n c l a s s r o o m s f o r some o f t h e i r c o n s t i t u e n t sc h o o l d i s t r i c t s . O th e r c o n s t i t u e n t d i s t r i c t s used a v a i l a b l e rooms ( o r a c o m b i n a t i o n o f rooms b u i l t w i t h s p e c i a l e d u c a t i o n fu n d s and a v a i l a b l e rooms). th a t * At t h a t time* 1 t was t h o u g h t In l i e u o f c o n s t r u c t i o n c o s t s g r a n t e d t o some prog ram s b u t n o t o t h e r s , 1 t would be e q u i t a b l e t o pay r e n t f o r t h o s e pro gra ms housed 1n rooms n o t b u i l t w i t h s p e c i a l e d u c a t i o n fun ds (Mange* 1985). One m i g h t a r g u e t h a t 1 t would be I n e q u i t a b l e t o s t o p t h e p r a c t i c e o f payi ng r e n t f o r pro gr ams housed In n o n - s p e c i a l e d u c a t 1 o n - b u 1 l t c l a s s r o o m s * when o t h e r s c o n t i n u e t o have c l a s s r o o m s a v a i l a b l e t h a t w e r e b u i l t w i t h s p e c i a l e d u c a t i o n funds. In t h e same v e i n , w i t h d r a w i n g f i n a n c i a l s u p p o r t f o r r e n t a l of c l a s s r o o m s p a c e m i g h t be v ie we d a s a v i o l a t i o n o f a l o n g - s t a n d i n g a g r e e m e n t among t h e d i s t r i c t s . In t h e c a s e o f s p e d a l - e d u c a t 1 o n - b u 1 l t rooms and r e n t be in g p a i d f o r o t h e r c l a s s r o o m pr o gr am s housed In nons p e c l a l - e d u c a t l o n - b u l l t rooms* no p o s i t i o n 1s t a k e n on t h e e q u i t y 109 of t h i s p r a c tic e . However# 1f r e n t 1s p a i d f o r a l l c l a s s r o o m s ( o r even some cl a s s r o o m s ) # r e g a r d l e s s o f w h e t h e r t h e y were b u i l t w i t h s p e c i a l e d u c a t i o n funds# t h i s p r a c t i c e would be v ie w e d a s one 1n which a f l a t g r a n t 1s d i s t r i b u t e d # and# a s such# e q u i t y among d i s t r i c t s 1s l i k e l y t o be redu ce d. e. O p e r a t i o n and m a i n t e n a n c e . Two ISDs a l l o w e d an amount f o r o p e r a ­ t i o n and m a i n t e n a n c e I n s t e a d o f t h e amount a l l o w e d by t h e s t a t e In d irect cost rate. (In both d i s t r i c t s # t h e allowed I n d i r e c t c o s ts a r e s u b t r a c t e d from a c o n s t i t u e n t d i s t r i c t ' s a l l o w a b l e c o s t s . ) One o f t h e s e two d i s t r i c t s had a p r o c e d u r e f o r c a l c u l a t i n g t h e a c t u a l amount s p e n t f o r o p e r a t i o n and m a i n t e n a n c e . employed w ere such t h a t # f o r a l l However# t h e methods p r a c t i c a l purposes# t h e d i s t r i b u ­ t i o n o f a f l a t amount was t h e r e s u l t . The o t h e r d i s t r i c t d i s t r i b ­ u t e d a f l a t amount ( t e r m e d an ' ' a l l o w a n c e ”) f o r o p e r a t i o n and m a in te n a n c e . As f l a t am ou nt s ( g r a n t s ) w ere b e i n g d i s t r i b u t e d # this 1s c o n s i d e r e d a p r a c t i c e 1n which e q u i t y was redu ce d. f. General e d u c a t i o n a d m i n i s t r a t i o n . The s t a t e do es n o t a l l o w a d d i ­ tio n a l c o s ts fo r general education a d m in is tr a t io n as th e se c o s ts a r e I n c l u d e d w i t h i n t h e g r o s s membership a l l o w a n c e . Two d i s t r i c t s I n c l u d e d a d d i t i o n a l am ou nts f o r g e n e r a l e d u c a t i o n a d m i n i s t r a t i o n . One d i s t r i c t I n c l u d e d an a d d i t i o n a l 3% o f t h e u n r e i m b u r s e d c o s t s f o r pr ograms c l a s s i f i e d as c e n t e r p ro g r a m s f o r t h e s u p p o r t of general education a d m in is tr a tio n . The o t h e r I n c l u d e d an a d d i t i o n a l amount f o r t h e s u p p o r t o f g e n e r a l e d u c a t i o n a d m i n i s t r a t i o n # which was d e t e r m i n e d by m u l t i p l y i n g t h e s t a t e I n d i r e c t c o s t r a t e (up t o 110 15%) by t h e t o t a l u n r e i m b u r s e d c o s t s f o r c o n s t i t u e n t school d i s ­ t r i c t s t h a t d id n o t employ a s p e c i a l e d u c a t i o n a d m i n i s t r a t o r . As t h e general education a d m i n i s t r a t i v e c o s t s a r e Included w ith in t h e g r o s s membership a l l o w a n c e , t h i s p r a c t i c e , though p er ha ps p o l i t i ­ c a l l y popular, has l i t t l e , 1f any, r a t i o n a l b a s i s f o r doing any­ th in g but reducing equity. The a c t u a l p r a c t i c e s used w her e l i m i t s were p l a c e d on c o s t s a l l o w e d by t h e s t a t e 1n d e t e r m i n i n g a c o n s t i t u e n t d i s t r i c t ' s a l l o w a b l e c o s t s were a p p l i e d t o (a) s u p p l i e s and m a t e r i a l s , (b) c o n f e r e n c e s and 1 n s e r v 1 c e s > and (c) l e g a l f e e s . These t h r e e t y p e s o f p r a c t i c e s a r e d i s c u s s e d t o g e t h e r b e c a u s e t h e i r e f f e c t on e q u i t y I s s i m i l a r . Some m i g h t say t h e p r a c t i c e of c a p p i n g e x p e n d i t u r e s a t a c e r t a i n " r e a s o n ­ a b l e ” l e v e l w i l l d i s c o u r a g e d i s t r i c t s from making u n n e c e s s a r y e x p e n d i ­ t u r e s and, a s a r e s u l t , e q u i t y w i l l t h i s p o sitio n plausible. be I n c r e a s e d . The r e s e a r c h e r f i n d s O t h e r s m i g h t say t h a t 1 f t h e l i m i t p l a c e d on c e r t a i n e x p e n d i t u r e s 1s low, 1 t would be l i k e d i s t r i b u t i n g a f l a t g r a n t f o r some I te m s . The r e s e a r c h e r a l s o f i n d s t h i s p o s i t i o n p l a u s i b l e . However, w i t h i n t h e sc op e o f t h i s s t u d y , t h e r e w er e no means t o j u d g e w h e t h e r t h e a d d i t i o n a l e x p e n d i t u r e s would a c t u a l l y be n e c e s s a r y . T h e r e f o r e , no p o s i t i o n 1s t a k e n on t h e e q u i t y o f p r a c t i c e s t h a t p l a c e l i m i t s on some t y p e s o f e x p e n d i t u r e s . The a c t u a l p r a c t i c e s used t h a t s u b t r a c t e d from c o s t s a l l o w e d by t h e s t a t e 1n d e t e r m i n i n g a c o n s t i t u e n t d i s t r i c t ' s a l l o w a b l e c o s t s were taken fo r: Ill a. State-approved aides. One ISD s u b t r a c t e d t h e c o s t s o f a i d e s who had been approved by s t a t e w a i v e r t o be I n c l u d e d a s an a l l o w a b l e expenditure. The p r o c e d u r e s I n v o l v e d 1n r e c e i v i n g a s t a t e w a i v e r I n c l u d e t h e ISD’s t a k i n g t h e p o s i t i o n t h a t an a i d e 1s n e c e s s a r y . I t 1s p u z z l i n g t o t h e r e s e a r c h e r why an ISD would v e r i f y t h e n e c e s s i t y of an a i d e and t h e n deny s p e c i a l e d u c a t i o n m l l l a g e b. reimbursement. Th is p r a c t i c e 1s j u d g e d t o r e d u c e e q u i t y . Indirect costs. T h r e e ISDs s u b t r a c t e d t h e s t a t e - a l l o w e d I n d i r e c t costs. Two of t h e s e d i s t r i c t s s u b t r a c t e d t h e I n d i r e c t c o s t s and s u b s t i t u t e d f l a t am ounts f o r o p e r a t i o n and m a i n t e n a n c e . As d i s ­ c u s s e d b e f o r e ( s e e d i s c u s s i o n on a d d i t i o n s t o a l l o w a b l e c o s t s f o r o p e r a t i o n and main ten an ce* p. 109)* t h i s p r a c t i c e was co n cl u d ed t o be one 1n which e q u i t y 1s r ed u ce d . The o t h e r d i s t r i c t s u b t r a c t e d t h e I n d i r e c t c o s t s 1n d e t e r m i n i n g t h e a l l o w a b l e c o s t ( o r d i d n o t I n c l u d e t h i s e x p e n s e In I t s a l l o w e d c o s t s ) . If the Indirect cost r a t e s o f a l l c o n s t i t u e n t sch ool d i s t r i c t s a r e t h e same (which 1s u n l i k e l y ) * e q u i t y would n o t be a f f e c t e d . To t h e e x t e n t t h a t I n d i r e c t c o s t r a t e s vary* t h i s p r a c t i c e w i l l r e d u c e e q u i t y . The a c t u a l p r a c t i c e used w here a s u b s t i t u t i o n was made 1n p l a c e o f t h e s t a t e methods f o r d e t e r m i n i n g a l l o w a b l e c o s t s was t h e p r a c t i c e of u s i n g o nl y t h e c o s t s o f s t a f f s a l a r y and f r i n g e b e n e f i t s . S taff salary and f r i n g e b e n e f i t s * b e c a u s e t h e y c o n s t i t u t e a l a r g e s h a r e o f a d i s ­ t r i c t ’s e x p e n d i t u r e s f o r s p e c i a l e d u c a t i o n pro gra ms and s e r v i c e s * w i l l l i k e l y a p p r o x i m a t e t h e p r o p o r t i o n o f s t a t e - a l l o w a b l e c o s t s among con­ s t i t u e n t sc h o o l d i s t r i c t s . However* t o t h e e x t e n t t h a t o t h e r 112 l e g i t i m a t e c o s t s v a r y , t h i s p r a c t i c e becomes one t h r o u g h which e q u i t y 1s r ed uce d. 2. V a r i a t i o n s 1n C a l c u l a t i o n o f R e c e i p t s F iv e p r a c t i c e s v a r i e d from t h e s t a t e method f o r c a l c u l a t i n g membership r e c e i p t s . Two p r a c t i c e s v a r i e d from t h e s t a t e method f o r calcu latin g categorical aid receipts. One p r a c t i c e v a r i e d from t h e s t a t e methods f o r c a l c u l a t i n g r e c e i p t s by I n c l u d i n g an a d d i t i o n a l su b tra c tio n fo r a local d i s t r i c t ' s c o n trib u tio n . The p r a c t i c e s t h a t v a r i e d from t h e s t a t e method f o r c a l c u l a t i n g membership r e c e i p t s (GMA x s p e c i a l e d u c a t i o n s t u d e n t FTE) were: a. No membership s u b t r a c t i o n . One d i s t r i c t d i d n o t s u b t r a c t any membership r e c e i p t s from t h e a l l o w a b l e c o s t . This p r a c t i c e r e s u l t s In a p e r c e n t a g e payment o f t h e a l l o w a b l e c o s t s . An exa m ple 1s shown u s i n g t h e d a t a from t h e h y p o t h e t i c a l ISD c o m p r i s i n g t h r e e c o n s t i t u e n t scho ol d i s t r i c t s p r e s e n t e d 1n T a b l e 11. The payo ut p e r c e n t a g e 1s c a l c u l a t e d by d i v i d i n g t h e f u n d s a v a i l a b l e ($58,650) by t h e t o t a l a l l o w a b l e c o s t s ($350,000). D istrict A D istrict B .D istrict £ 150,000 .1675 140,000 .1675 60,000 .1675 Amount o f R ei mb ur se me nt 25,125 23,450 10,050 T o t a l Un reimbursed C o s t s 43,350 61,200 12,750 58% 38% 79% T o t a l A l l o w a b l e C o s ts Times Payout Percent P e r c e n t o f U nr eim bur se d C o s ts 113 As shown above# a p e r c e n t a g e payment o f t h e a l l o w a b l e c o s t s r e s u l t s 1n t h e I n e q u i t a b l e d i s t r i b u t i o n o f s p e c i a l e d u c a t i o n m l l l a g e funds. The p r a c t i c e o f n o t s u b t r a c t i n g membership r e c e i p t s s i g n i f i c a n t l y reduces e q u ity . b. Minimum g r o s s , membership a l l o w a n c e t i m e s t h e number o f f u l l - t i m e eq u iv a le n t sp ecial education s tu d e n ts . minimum g r o s s membership a l l o w a n c e . One d i s t r i c t s e t a A local d i s t r i c t ’s actual g r o s s me mbe rs hip a l l o w a n c e o r t h e minimum g r o s s membership a l l o w ­ ance# w h i c h e v e r 1s g r e a t e r # 1s m u l t i p l i e d by t h e number o f f u l l ­ t i m e e q u i v a l e n t s t u d e n t s s e r v e d t o d e t e r m i n e t h e amount o f member­ ship su b tractio n . The a d v a n t a g e o f t h i s p r a c t i c e 1s t h a t 1 t a l l o w s t h e ISD t o pay o u t a h i g h e r p e r c e n t a g e o f a l l t h e c o n s t i t u e n t d i s t r i c t ' s unreimbursed costs# as c a l c u l a t e d . The h i g h e r pa yo ut p e r c e n t a g e 1s a c h i e v e d by r e d u c i n g t h e amount of u n r e im b u r s e d c o s t s p a i d f o r some d i s t r i c t s # namely t h o s e w i t h a g r o s s membership a l l o w a n c e below t h e e s t a b l i s h e d minimum. The amount o f a d i s ­ t r i c t ' s g r o s s membership a l l o w a n c e 1s d e t e r m i n e d by t h e number o f m i l l s levied. T h i s p r a c t i c e I n c r e a s e s t h e membership s u b t r a c t i o n and t h u s r e d u c e s t h e s p e c i a l e d u c a t i o n m l l l a g e r e i m b u r s e m e n t o f d i s t r i c t s t h a t le v y a m l l l a g e below t h e minimum r e q u i r e d . Dis­ t r i c t s t h a t a r e e i t h e r u n w illin g or unable t o genera te th e neces­ s a r y m l l l a g e a r e p e n a l iz e d # w h er ea s o t h e r d i s t r i c t s w i t h a h i g h e r g r o s s memb ership a l l o w a n c e a r e c o m p a r a t i v e l y rewarded. Although 1 t 1s l i k e l y t o be p o l i t i c a l l y a d v a n t a g e o u s t o show a h i g h e r pa y o u t p e r c e n ta g e # t h i s 1s a c c o m p l i s h e d a t t h e ex p en s e o f d i s t r i c t s w i t h a 114 low g r o s s membership a l l o w a n c e . There fore# t h i s p r a c t i c e 1s v ie we d a s one t h r o u g h which e q u i t y 1s redu ce d, c. Gross membership a l l o w a n c e t i m e s a s t a n d a r d i z e d s t u d e n t h e a d co u n t . One ISD e s t a b l i s h e d a s t a n d a r d head c o u n t f o r each t y p e o f s p e c i a l e d u c a t i o n program. For each c o r r e s p o n d i n g program type# t h e s t a n d a r d head c o u n t 1s m u l t i p l i e d by a d i s t r i c t ' s g r o s s member­ s h i p a l l o w a n c e t o d e t e r m i n e t h e amount of membership s u b t r a c t i o n . As a v a r i a n c e from t h e s t a t e method# t h i s p r a c t i c e r e s u l t s 1n a l a r g e r pa y o u t p e r c e n t a g e t o a l l c o n s t i t u e n t school d i s t r i c t s by r e d u c i n g t h e amount o f payment t o t h o s e d i s t r i c t s 1n which pr o gr am s a r e o p e r a t e d w i t h a s t u d e n t (FTE) c o u n t l e s s t h a n w h a t 1s e s t a b ­ l i s h e d f o r each program t y p e . f i n a n c i a l l y encour ag ed. Th ere fo re# l a r g e r c l a s s s i z e s a r e The s t a t e method o f d e d u c t i n g membership r e c e i p t s 1s based on t h e a c t u a l number of s t u d e n t s (FTE) 1n each program and 1s d e s i g n e d n e i t h e r t o r e w a r d n o r t o p e n a l i z e a d i s ­ t r i c t f o r t h e number o f s t u d e n t s s e r v e d . The r a t i o n a l e 1s t h a t 1n some ar ea s# due t o g e o g r a p h i c a n d / o r demo gra phi c c o n s i d e r a t i o n s # s ch o o l d i s t r i c t s a r e f o r c e d t o o p e r a t e pr og ram s w i t h f e w e r s t u ­ dents. Additionally# a ll d i s t r i c t s are su sc ep tib le to receiving s t u d e n t s who# due t o t h e s e v e r i t y o f t h e i r needs# r e q u i r e s m a l l e r c l a s s - s l z e placements. However# some would a r g u e t h a t # f o r d e n s e ly p o p u l a t e d a r e a s# t h e p r a c t i c e o f d e d u c t i n g a s t a n d a r d membership would I n c r e a s e e q u i t y b e c a u s e : 1. D i s t r i c t s a r e l a r g e enough g e n e r a l l y t o have t h e same t y p e s and numbers o f s t u d e n t s # 115 2. D istric ts are financially en co u ra g ed t o s e r v e a r e a s o n a b l e number of s t u d e n t s In each program* and 3. Each d i s t r i c t would hav e a s i m i l a r d e d u c t i o n p e r t y p e of program* r e g a r d l e s s o f t h e number o f s t u d e n t s served* resulting 1n t h e a v a i l a b l e f u n d s b e i n g more e v e n l y d i s t r i b u t e d among constituent d i s t r i c t s . The r e s e a r c h e r s e e s m e r i t In t h e p r e c e d i n g ar g u m e n t a s a p p l i e d t o d e n s e l y p o p u l a t e d a r e a s and t a k e s no p o s i t i o n on t h e e q u i t y of t h i s p r a c t i c e f o r ISDs c o m p r i s i n g urb an and s u b u r b a n p o p u l a t i o n s . In o the r* l e s s d e n s e l y p o p u l a t e d s e t t i n g s * t h i s p r a c t i c e 1s v ie w ed as c o n t r i b u t i n g t o a r e d u c t i o n In e q u i t y . d. Gross membership a l l o w a n c e t i m e s t h e s t u d e n t head c o u n t . One ISD m u l t i p l i e d a d i s t r i c t ’s g r o s s membership a l l o w a n c e by t h e t o t a l number o f n o n r e s i d e n t s t u d e n t s t o d e t e r m i n e t h e membership s u b t r a c ­ t i o n f o r any n o n r e s i d e n t s t u d e n t s se r v e d . I f an o p e r a t i n g d i s t r i c t r e c e i v e s a t u i t i o n c h a r g e f o r each n o n r e s i d e n t s t u d e n t s e r v e d t h a t 1s equal t o t h e d i s t r i c t ' s g r o s s membership a l l o w a n c e and each s t u d e n t 1s s e r v e d f u l l t i m e 1n t h e s p e c i a l e d u c a t i o n program* t h i s p r a c t i c e would be v ie w ed a s e q u i t a b l e . To t h e e x t e n t t h a t s t u d e n t s a r e p l a c e d p a r t t i m e 1n t h e g e n e r a l e d u c a t i o n program (which r e d u c e s t h e FTE)* o r t h e amount o f t u i t i o n v a r i e s from t h e o p e r a t f 1ng d i s t r i c t ' s g r o s s me mb ers hi p allo wan ce* eq u i ty * a l t h o u g h H k e l y t o a small degree, e. w i l l be reduc ed . Actual n e t re v e n u e p e r s t u d e n t t i m e s t h e number o f f u l l - t i m e equivalent students served. Two ISDs s u b t r a c t e d a c o n s t i t u e n t 116 sc ho ol d i s t r i c t ' s a c t u a l n e t r eve nu e p e r s t u d e n t I n s t e a d o f I t s s t a t e g r o s s membership a l l o w a n c e when c a l c u l a t i n g r e c e i p t s . This p r a c t i c e w i l l only a f f e c t t h e d i s t r i b u t i o n o f s p e c i a l e d u c a t i o n m l l l a g e f u n d s 1n ISDs where a t l e a s t one c o n s t i t u e n t sc ho ol d i s ­ t r i c t 1s o u t - o f - f o r m u l a . (Se e d i s c u s s i o n o f a d d i t i o n a l findings f o r R es e a r c h Q u e s t i o n 1# page 70# f o r e x p l a n a t i o n o f 1 n - f o r m u l a and o u t - o f - f o r m u l a sch ool d i s t r i c t s . ) For 1 n - f o r m u l a scho ol d i s ­ t r i c t s # t h e a c t u a l n e t r e v e n u e p e r s t u d e n t 1s t h e i r g r o s s member­ ship allowance. For o u t - o f - f o r m u l a school d i s t r i c t s # th e actual n e t r e v e n u e p e r s t u d e n t 1s t h e amount r a i s e d e x c l u s i v e l y from l o c a l p r o p e r t y t a x e s p e r s t u d e n t and p e r m i l l l e v ie d# which# by d e f i n i ­ ti o n # a l w a y s e x c e e d s t h e i r g r o s s membership a l l o w a n c e . Bec au se t h e a c t u a l n e t rev en ue p e r s t u d e n t 1s al wa ys l a r g e r t h a n t h e g r o s s membership a l l o w a n c e f o r o u t - o f - f o r m u l a d i s t r i c t s # s u b s t i t u t i n g t h e l a r g e r amount I n c r e a s e s t h e membership s u b t r a c t i o n for out-of-form ula d is tric ts # which r e d u c e s t h e i r u n r e i m b u r s e d c o s t s and t h e i r c l a i m on t h e ISD s p e c i a l e d u c a t i o n m l l l a g e fund. An ex am p le 1s given# I l l u s t r a t i n g t h e e f f e c t o f t h i s p r a c t i c e f o r an o u t - o f - f o r m u l a c o n s t i t u e n t d i s t r i c t a s compared t o t h e s t a t e method o f u s i n g t h e g r o s s membership a l lo w a n c e . The I n f o r m a t i o n f o r t h e h y p o t h e t i c a l ISD c o m p r i s i n g t h r e e c o n s t i t u e n t sch ool d i s ­ t r i c t s ( p r e s e n t e d 1n T a b l e 11) was used w i t h D i s t r i c t B a s an o u t o f - f o r m u l a d i s t r i c t w i t h an a c t u a l n e t rev enue p e r s t u d e n t of $2 ,5 00 . 117 F i r s t , membership r e c e i p t s a r e c a l c u l a t e d . P r a c t i c e Used For Membership Amount Numbers o f Students x Membership Amount = Membership Receipts G r o s s Membership Allowance 34 x $2,000 = $68,000 A ct ua l Net Revenue P e r S t u d e n t 34 x $2#500 = $85#000 Second# un re im bu rs e d c o s t s a r e c a l c u l a t e d . P r a c t i c e Used For Membership Amount Total Costs Membership ( DS 4096) - R e c e i p t s - S tate C a t Aid Gr oss Memb. Allowance $140#000 - $68#000 - $10#800 = $61#200 Act Net Rev P e r Stud $140,000 - $85,000 - $10,800 = $44,200 D ifference 0 $17,000 = Unrelmb Costs 0 $17,000 As shown, t h e u n r e i m b u r s e d c o s t s a r e r ed u ce d by $17,000. The t o t a l sum o f a l l u n r e i m b u r s e d c o s t s c l a i m e d by c o n s t i t u e n t d i s ­ t r i c t s on t h e ISD s p e c i a l e d u c a t i o n fund a r e a l s o r e d u c e d (1 n t h i s c a s e ) by $17,000. For t h e model p r e s e n t e d In T a b l e 11, t h i s would r e s u l t 1n $100,300 I n s t e a d o f $117,300 b e i n g c l a i m e d a s u n r e i m b u r s e d costs. With $100,300 b ei n g c l a i m e d on t h e a v a i l a b l e s p e c i a l e d u c a ­ t i o n fund amount o f $58,650 I n s t e a d o f $117,300, t h e H k e - p e r c e n t payment 1s I n c r e a s e d fr o m 50% t o 58% o f t h e u n r e i m b u r s e d c o s t s c l a i m e d by each c o n s t i t u e n t d i s t r i c t . Many d i f f e r e n t e x a m p le s co u ld be shown o f t h i s e f f e c t , which would r e s u l t 1n an I n c r e a s e d H k e - p e r c e n t payment and many v a r i a ­ t i o n s of t h e u n r e i m b u r s e d c o s t p a t t e r n s o f w h a t e v e r number o f o u t o f - f o r m u l a d i s t r i c t s a r e c o n s t i t u e n t s o f an ISD. Using t h i s 118 p r a c t i c e * when a t l e a s t one c o n s t i t u e n t school d i s t r i c t 1s o u t - o f formula* w i l l al w ay s r e s u l t In a h i g h e r l e v e l o f a c t u a l r e i m ­ bursement t o t h e 1n-formula d i s t r i c t s . Some hav e arg ue d t h a t 1 t 1s more e q u i t a b l e t o use t h e a c t u a l n e t r ev en u e p e r s t u d e n t 1n c a l c u l a t i n g membership r e c e i p t s b e c a u s e t h i s amount more a c c u r a t e l y r e f l e c t s t h e b a s i c l e v e l o f s u p p o r t a v a i l a b l e t o each s t u d e n t . O t h e r s have arg ue d t h a t t h e s t a t e g r o s s memb ership a l l o w a n c e s h o u l d c o n t i n u e t o be used 1n c a l c u l a t i n g membership r e c e i p t s b e c a u s e any a d d i t i o n a l funds r a i s e d beyond t h e g r o s s me mbe rs hip a l l o w a n c e have been t o t a l l y p r o v i d e d from l o c a l revenues* and d i s t r i c t s s h o u l d n o t be p e n a l i z e d bec a us e o f b e n e f i t s g r a n t e d t o t a l l y from l o c a l s u p p o r t . supporters. Both ar g u m e n ts have s t r o n g However* 1n t h e r e s e a r c h e r ’s o p i n i o n , vi e w i n g t h e tw o p r a c t i c e s on t h e b a s i s o f e q u i t y , t h e a r gu m e nt t h a t f a v o r s u s i n g t h e a c t u a l n e t rev enu e p e r s t u d e n t 1n c a l c u l a t i n g membership r e c e i p t s 1s more p e r s u a s i v e , w i t h t h e c o n d i t i o n t h a t a p p l i c a b l e a d j u s t m e n t s a r e made 1n t h e a c t u a l n e t p e r s t u d e n t rev enu e f o r any f u n d s r e c a p t u r e d by t h e s t a t e . The p r a c t i c e s t h a t v a r i e d from t h e s t a t e method f o r c a l c u l a t i n g s t a t e c a t e g o r i c a l a i d r e c e i p t s w er e: a. No s t a t e c a t e g o r i c a l a i d s u b t r a c t i o n . Two ISDs d id n o t I n c l u d e s t a t e c a t e g o r i c a l a i d a s a r e c e i p t 1n c a l c u l a t i n g a c o n s t i t u e n t d i s t r i c t ' s unreimbursed c o s t. Because s t a t e s p e c i a l e d u c a t i o n c a t e g o r i c a l a i d 1s p a i d t o a sch ool d i s t r i c t on t h e b a s i s o f a 119 l i k e - p e r c e n t o f e x c e s s c o s t , t h i s p r a c t i c e r e s u l t s 1n a H k e p e r c e n t r e d u c t i o n o f t h e u n r e i m b u r s e d c o s t s f o r each c o n s t i t u e n t sc ho ol d i s t r i c t . I f th e to ta l actual rei m b u r se m en t p a i d t o c o n s t i t u e n t d i s t r i c t s ( s t a t e c a t e g o r i c a l a i d and ISD r e im b u r s e m e n t ) does n o t ex ce ed t h e total u n r e im b u r s e d c o s t s o f t h e c o n s t i t u e n t d i s t r i c t s # t h i s p r a c ­ t i c e ha s no e f f e c t on e q u i t y 1n t h e d i s t r i b u t i o n of s p e c i a l e d u c a ­ t i o n m l l l a g e funds. T h i s 1s shown by c om p ar in g t h e s t a t e method o f Inclu d in g s t a t e c a t e g o r ic a l aid as a r e c e i p t w ith t h e v a r i a n t p r a c t i c e of n o t I n c l u d i n g s t a t e c a t e g o r i c a l a i d a s a r e c e i p t f o r t h e h y p o t h e t i c a l ISD c o m p r i s i n g t h r e e c o n s t i t u e n t sch oo l d i s ­ tricts# which was p r e s e n t e d i n T a b l e 11. D istrict A Dis t r i c t B D istrict £ S t a t e Method of S u b t r a c t i n g C a t e g o r i c a l Aid R e c e i p t s : $ 21#675 $ 30 ,6 00 $ T o t a l C o s t s (DS 4096) Minus S t a t e Membership R e c e i p t s No C a t e g o r i c a l Aid S u b t r a c t i o n E qu al s Unreimbursed C o s t Claim Times L i k e - P e r c e n t * $150,000 -99,000 0 5 1 ,0 0 0 .425 $140,000 - 68,0 0 0 $ 60 ,0 00 -45,000 0 1 5 ,0 0 0 .425 Eq ua ls ISD Reimbursement $ 21 ,6 75 $ 30,600 ISD Reimbursement 6,37 5 P r a c t i c e o f Not S u b t r a c t i n g C a t e g o r i c a l Aid R e c e i p t s ; D i f f e r e n c e Between Methods 0 72,000 .425 0. ^ C a l c u l a t i o n o f L 1 k e - P e r c e n t ( 5 8, 65 0 / 1 38, 00 0 = 42.5% o r .4 25 ) $ 6, 37 5 120 ISDs m i g h t ch oos e n o t t o s u b t r a c t s t a t e c a t e g o r i c a l a i d f o r t h e f o l l o w i n g tw o r e a s o n s : 1. The number of c a l c u l a t i o n s 1s reduced* and t h e r e 1s no r e d u c ­ t i o n 1n t h e e q u i t a b l e d i s t r i b u t i o n o f f u n d s (gi ven t h a t t h e total r e im b u rs e m e n t do es n o t ex c e e d t h e t o t a l u n r ei m bu r se d c o s t s ) ; and 2. They may be a b l e t o f i n a l i z e r e i m b u r s e m e n t payments t o con­ s t i t u e n t d i s t r i c t s sooner than 1f they w aited f o r c a l c u l a t i o n and r e i m b u r s e m e n t o f s t a t e c a t e g o r i c a l a i d payments. One ISD d id n o t s u b t r a c t s t a t e c a t e g o r i c a l a i d 1n c a l c u l a t i n g u n r e i m b u r s e d c o s t s f o r c o n s t i t u e n t d i s t r i c t pr og ram s t h a t a r e a v a i l a b l e t o a l l c o n s t i t u e n t d i s t r i c t s ( c e n t e r programs). T h i s ISD a l s o r e i m b u r s e d 100% o f t h e u n r e i m b u r s e d c o s t s o f c e n t e r pro gr ams o p e r a t e d by c o n s t i t u e n t d i s t r i c t s , which r e s u l t s 1n an o ver pay m ent o f w h a t e v e r amount o f s t a t e c a t e g o r i c a l a i d 1s r e c e i v e d . Although t h i s p r a c t i c e m i g h t be v ie w e d a s one 1n which an a d d i t i o n a l I n c e n ­ t i v e 1s p r o v i d e d f o r c o n s t i t u e n t d i s t r i c t s t o o p e r a t e c e n t e r pr o ­ gr ams , 1 t u n q u e s t i o n a b l y v i o l a t e s t h e p r i n c i p l e o f e q u i t y 1n t h e d i s t r i b u t i o n of s p e c ia l ed u catio n m llla g e su p p o rt funds, b. A d j u s t m e n t s t h a t a r e made f o r t h e amount r e c a p t u r e d bv t h e s t a t e f rom o u t - o f - f o r m u l a l o c a l s ch ool d i s t r i c t s b v . r e d u c i n g t h e s p e c i a l e d u c a t i o n c a t e g o r i c a l a i d pay m ent s. As d i s c u s s e d e a r l i e r ( s e e A d d i t i o n a l F i n d i n g s f o r Resea rc h Q u e s t i o n 1, p. 7 0 ) , a t l e a s t f o u r ISDs w ere u s i n g s p e c i a l e d u c a t i o n m l l l a g e f u n d s t o r e p l a c e a l l o r p a r t o f what t h e s t a t e 1s r e c a p t u r i n g 1n g e n e r a l membership a i d 121 from t h e f r o u t - o f - f o r m u l a c o n s t i t u e n t sc h o o l d i s t r i c t s . The a c t i o n I s a d i r e c t payment o f earmarked f u n d s ( s p e c i a l e d u c a t i o n ) t o r e p l a c e g e n e r a l funds t h a t a r e a l r e a d y e x c e s s i v e a c c o r d i n g t o Michigan law. In a d d i t i o n , t h e o u t - o f - f o r m u l a d i s t r i c t s t h a t r e c e i v e d r e p l a c e m e n t fu nd s f o r w ha t t h e s t a t e r e c a p t u r e d a l s o s h a r e d 1n t h e d i s t r i b u t i o n o f t h e r e m a i n i n g s p e c i a l e d u c a t i o n funds. T h i s p r a c t i c e 1s c l e a r l y and u n q u e s t i o n a b l y c o n t r a r y t o t h e s t a t e - e s t a b l i s h e d system f o r f in a n c in g p u b lic e d u ca tio n , as well as a v i o l a t i o n of t h e p r i n c i p l e of equ ity . In ISDs w her e t h i s p r a c ­ t i c e o c c u r s , any ar g u m e n ts o r b e l i e f s t h a t s p e c i a l e d u c a t i o n m i l l age fu nd s a r e b ei ng d i s t r i b u t e d e q u i t a b l y among c o n s t i t u e n t school d i s t r i c t s a r e w i t h o u t r a t i o n a l s u b s t a n c e and can a c c u r a t e l y be defined as I l l u s o r y . The p r a c t i c e t h a t I n v o l v e d t h e s u b t r a c t i o n o f an a d d i t i o n a l r e c e i p t was made f o r a l o c a l d i s t r i c t c o n t r i b u t i o n . One ISD r e i m b u r s e d 100% o f t h e u n r e im b u r s e d c o s t s f o r c l a s s r o o m pr og r am s a v a i l a b l e t o a l l c o n s t i t u e n t d i s t r i c t s ( c e n t e r p r og ra m s ) , a f t e r d e d u c t i n g 25% o f t h e p r e c e d i n g y e a r ' s u n r e im b u r s e d program c o s t s , which 1s t h e amount con­ s i d e r e d t o be a l o c a l c o n t r i b u t i o n from t h e r e s i d e n t d i s t r i c t o f each s t u d e n t se rv e d . In t h i s ISD, t h e r e s i d e n t d i s t r i c t was r e q u i r e d t o pay 25% o f t h e p e r c a p i t a u n r e im b u r s e d c o s t s from t h e p r e v i o u s y e a r f o r each of I t s s t u d e n t s s e r v e d In a c e n t e r program. As a r e s u l t , the same amount o r a f l a t f e e per s t u d e n t 1s p ai d by t h e r e s i d e n t d i s t r i c t t o t h e o p e r a t i n g d i s t r i c t a s t h e amount o f t h e l o c a l d i s t r i c t ' s 122 contribution. The ISD used t h i s p r a c t i c e t o d i s c o u r a g e p l a c e m e n t o f s t u d e n t s 1n c e n t e r programs. The r e s e a r c h e r t a k e s no p o s i t i o n on t h e e q u i t y o f c h a r g i n g an amount t o t h e r e s i d e n t d i s t r i c t f o r each s t u d e n t s e r v e d i n a c e n t e r c l a s s r o o m program. However* r e q u i r i n g a l o c a l c o n t r i b u t i o n a s d e f i n e d by t h i s ISD r e s u l t s 1n a f l a t amount b e i n g pai d t o t h e o p e r a t i n g d i s t r i c t by t h e s e n d i n g d i s t r i c t ( I n s t e a d of* for example* a p e r c e n t a g e o f a s e n d i n g d i s t r i c t ' s g r o s s membership a l l o w ­ ance). I t ha s a l r e a d y been shown t h a t f l a t - p a y m e n t s y s t e m s a r e I n e q u i ­ t a b l e me tho ds f o r d i s t r i b u t i n g fund s. Th ere fo re * bec a us e o f t h e method used f o r d e t e r m i n i n g t h e amount o f t h e l o c a l c o n t r i b u t i o n * 1s vi ew ed a s on e where e q u i t y among c o n s t i t u e n t d i s t r i c t s , though l i k e l y t o a s m a l l degree, 3. 1s reduced. V a r i a t i o n s 1n t h e Manner o f Payment ISDs used t h r e e p r a c t i c e s t h a t r e s u l t e d 1n o t h e r t h a n a 1 I k e p e r c e n t payment f o r a l l pr og r am s and s e r v i c e s * as r e q u i r e d by t h e special education rules. (Note: p ro g r am s may be p a i d 1n f u l l * The u n r e i m b u r s e d c o s t s o f c e n t e r before th e p ro ratio n of other special e d u c a t i o n pr ograms and s e r v i c e s , a s a l l o w e d 1n Rule 340.1811* s u b r u l e (4). T h i s o p t i o n a l p r a c t i c e * however* 1s s i m p l y an e f f i c i e n c y m e asu re t o a v o i d t h e n e c e s s i t y o f b i l l i n g and r e s u l t s 1n t h e same p e r c e n t a g e of t h e u n r e i m b u r s e d c o s t s b e i n g pa id . An exa m ple showing t h a t t h e p r a c ­ t i c e o f f i r s t p r o v i d i n g f u l l s u p p o r t t o c e n t e r prog ram s and t h e n p r o ­ r a t i n g o t h e r p ro g ram s r e s u l t s 1n t h e same l e v e l o f program s u p p o r t a s p ay in g a l i k e - p e r c e n t f o r a l l pro gr ams and t h e n b i l l i n g d i s t r i c t s f o r 123 any u n r e i m b u r s e d c o s t s of c e n t e r pro gr ams 1s p r e s e n t e d u n d e r R e s ea r c h Q u e s t i o n 3 , S u b s i d i a r y Q u e s t i o n 3b, p. 136). The p r a c t i c e s t h a t v a r i e d from t h e s t a t e method 1n t h e manner o f payment were: a. L 1 k e - p e r c e n t payment f o r some p r o g r a m s . One ISD r e i m b u r s e d c o s t s In a H k e - p e r c e n t payment o n l y f o r c o n s t l t u e n t - s c h o o l - d i s t r i c t employed p s y c h o l o g i s t s , s o d a ! w o r k e r s , and speech t h e r a p i s t s . The p r i n c i p l e o f e q u i t y 1n t h e d i s t r i b u t i o n of s p e c i a l e d u c a t i o n m i l l age f u n d s 1s based on an equa l l e v e l o f s u p p o r t f o r a l 1 s p e c i a l e d u c a t i o n pro gr ams and s e r v i c e s . The p r a c t i c e of s e l e c t i n g some p r o g r a m s o v e r o t h e r s t o r e c e i v e s p e c i a l e d u c a t i o n m l l l a g e fund reim bursem ent v i o l a t e s th e p r i n c i p le of equity. b. P r i o r i t y payment s y s t e m . T h r ee ISDs used a p r i o r i t y payment s ys te m 1n d i s t r i b u t i n g s p e c i a l e d u c a t i o n m l l l a g e fu nd s t o c o n s t i t u e n t sch ool d i s t r i c t s . This p r a c t i c e Involves t h e assignm ent of s p e c ia l e d u c a t i o n pr ogr am s I n t o t h r e e o r more g r o u p i n g s t h a t d e s i g n a t e t h e i r p r i o r i t y fo r r e c e iv in g reimbursement. The p r og r am s and s e r v ­ i c e s gr ouped 1n t h e h i g h e s t p r i o r i t y a r e p r o v id ed a f u l l o r 1 I k e p e r c e n t payment f o r t h e u n r e im b u r s e d c o s t s . Then, t o t h e e x t e n t t h a t f u n d s r e m a i n , pro gr ams and s e r v i c e s grouped 1n t h e n e x t h i g h ­ e s t p r i o r i t y a r e p r o v i d e d a f u l l o r H k e - p e r c e n t payment f o r t h e u n r e i m b u r s e d c o s t s , and so on. By u s i n g t h i s p r o c e d u r e , a H k e - p e r c e n t l e v e l o f s u p p o r t 1s p r o v i d e d f o r programs and s e r v i c e s t h a t have been a s s i g n e d t o t h e same p r i o r i t y l e v e l , and a v a r y i n g pa y o ut p e r c e n t a g e o c c u r s among t h e d i f f e r e n t t y p e s o f pr og ram s and 124 services# dep en di ng on w her e each m i g h t hav e been a s s i g n e d t o one of t h e p r i o r i t i z e d r e i m b u r s e m e n t l e v e l s . The p r i n c i p l e o f e q u i t y 1n t h e d i s t r i b u t i o n o f s p e c i a l educa­ t i o n m l l l a g e f u n d s ha s been d e f i n e d a s a f u l l o r H k e - p e r c e n t su p p o rt fo r t h e unreimbursed c o s t s of a l l s p e c ia l education pro­ grams and s e r v i c e s . When a l l p ro g ram s and s e r v i c e s a r e n e c e s s a r y t o m e e t t h e needs o f h an d i c a p p e d c h i l d r e n # 1 t 1s I m p o s s i b l e 1n t h e c o n t e x t o f e q u i t y t o a s s i g n a program o r s e r v i c e t o a h i g h e r o r l o w e r r e i m b u r s e m e n t l e v e l t h a n o t h e r pr o gr am s and s e r v i c e s . Th ere ­ fo re# t h e p r a c t i c e o f u s i n g a p r i o r i t y s y st e m r e d u c e s e q u i t y 1n t h e d i s t r i b u t i o n of sp ecia l education m lllage funds, c. P r o p o r t i o n a t e c a s e l o a d payment s y s t e m . One ISD s e t a minimum c a s e ­ l o a d c o u n t p e r t y p e o f program o r s e r v i c e . I f th e highest caseload count during th e school y e a r meets or exceeds th e e s t a b l i s h e d minimum# t h e program o r s e r v i c e 1s r e i m b u r s e d a f u l l 100% o f t h e unreimbursed c o s ts . I f t h e h ig h e st c a selo ad count during t h e sc hoo l y e a r 1s l e s s t h a n t h e e s t a b l i s h e d minimum# t h e program o r s e r v i c e 1s r e i m b u r s e d on t h e b a s i s o f a p e r c e n t a g e of t h e u n r ei m ­ b u rs e d c o s t s . T h i s 1s c a l c u l a t e d by d i v i d i n g t h e h i g h e s t c a s e l o a d c o u n t by t h e e s t a b l i s h e d minimum c a s e l o a d co u n t . The e f f e c t s # r a t i o n a l e # and e q u i t y o f t h i s p r a c t i c e a r e e s s e n t i a l l y t h e same as t h o s e of u s i n g a s t a n d a r d i z e d s t u d e n t program c o u n t 1n c a l c u l a t i n g r e c e i p t s # which h a s a l r e a d y been d i s c u s s e d . p. 114.) ( S ee d i s c u s s i o n on 125 P r o p o r t i o n a t e g e n e r a l membership d i s t r i b u t i o n s y s t e m . One ISD used a p r o p o r t i o n a t e g e n e r a l membership d i s t r i b u t i o n s y st e m t o d i s b u r s e s p e c i a l e d u c a t i o n m l l l a g e fu n ds t o c o n s t i t u e n t school d i s t r i c t s . One method t h a t can be used t o c a l c u l a t e a c o n s t i t u e n t d i s t r i c t ' s r e i m ­ b u r s e m e n t und er t h i s d i s t r i b u t i o n s y st em I n v o l v e s d e t e r m i n i n g a payo ut p e r c e n t a g e f o r each c o n s t i t u e n t sc h o o l d i s t r i c t / 1. The t o t a l as follow s: ISD s t u d e n t membership 1s d i v i d e d by t h e s t u d e n t member­ s h i p c o u n t o f each c o n s t i t u e n t d i s t r i c t t o equal I t s r e s p e c t i v e p a y o u t percentage. 2. The t o t a l amount a v a i l a b l e f o r d i s t r i b u t i o n 1s m u l t i p l i e d by each c o n s t i t u e n t s ch oo l d i s t r i c t ' s payout p e r c e n t a g e t o d e t e r m i n e I t s r e s p e c t i v e payment. T a b l e 13 1s a co m pa r is on t a b l e I n d i c a t i n g t h e d i f f e r e n c e s between t h e s t a t e e x c e s s - c o s t d i s t r i b u t i o n sy ste m and t h e p r o p o r t i o n a t e g e n e r a l membership d i s t r i b u t i o n s y s t e m f o r t h e h y p o t h e t i c a l ISD c o m p r i s i n g t h r e e c o n s t i t u e n t scho ol d i s t r i c t s / which was p r e s e n t e d 1n T a b l e 11. As shown 1n T a b l e 13/ D i s t r i c t A 1s p a i d 61% o f I t s u n r e i m b u r s e d c o s t s / D i s t r i c t B 1s pai d 35% o f I t s u n r e i m b u r s e d c o s t s / and D i s t r i c t C 1s p a i d 84% o f I t s u n r e i m b u r s e d c o s t s . By co m pa rin g t h e f i n d i n g s r e p o r t e d f o r t h e p r o p o r t i o n a t e g e n e r a l membership d i s t r i b u t i o n s yst em 1n T a b l e 13 w i t h t h o s e r e p o r t e d f o r t h e f l a t - g r a n t d i s t r i b u t i o n sy stem 1n T a b l e 12 (both w ere c a l c u l a t e d f o r t h e same h y p o t h e t i c a l ISD com­ p r i s i n g t h r e e c o n s t i t u e n t school d i s t r i c t s ) / 1 t 1s s e e n t h a t an a l m o s t I d e n t i c a l d i s t r i b u t i o n of s p e c i a l e d u c a t i o n m l l l a g e f u n d s o c c u r s 126 T a b l e 1 3 . — Comparison a n a l y s i s o f c o n s t i t u e n t d i s t r i c t r e im b u r s e m e n t u n d e r R u l e 3 4 0 . 1 8 1 1 # s u b r u l e s ( 2 ) , (3) a n d ( 4 ) , and a p r o p o r t i o n a t e g e n e r a l membership sy st em . D istrict A P.1str ic t B D istrict £ $43,3 50 ..X.5Q $21,675 $61,200 x.50 $30,600 $12,750 x.50 $ 6,375 5055 50% $43,3 50 $61,200 $12,750 2.500 5.500 .454 2,000 5,500 .364 1,000 5,500 .182 $58,650 .454 $26,627 $58,650 .304. $21,348 $58,650 .182 $10,674 61% 35% 84% 0 0 0 + $4,952 - $ 9,252 + $4,299 +11% -15% +34% S t a t e Excess C o s t Svstem T ot al Unreimbursed C o s t s Times Like P a y o u t P e r c e n t Amount o f Reimbursement P e r c e n t Unreimbursed C o s t s 50% P r o p o r t i o n a t e Memb Svstem T o t a l Unreimbursed C o s t s T o t a l D i s t r i c t Membership D ivi de d by In te rm ed Memb Eq u al s P r o p o r t i o n a t e S h a r e A v a i l a b l e Funds Times P r o p o r t i o n a t e S h a r e Amount o f Reimbursement P e r c e n t Unreimbursed C o s t s D i f f e r e n c e s Between Svstems T ot al Unreimbursed C o s t s Amount of Reimbursement P e r c e n t Unreimbursed C o s t s 127 among t h e t h r e e c o n s t i t u e n t s c h o o l d i s t r i c t s un de r t h e two s y s t e m s . T h i s o c c u r s b e c a u s e t h e p r o p o r t i o n a t e g e n e r a l membership s y s t e m 1s s i m p l y a v a r i a t i o n o f t h e f l a t - g r a n t system* a s both s y s t e m s a r e based on d i s b u r s i n g f l a t - g r a n t amounts. To show t h a t t h e p r o p o r t i o n a t e g e n e r a l me mbe rs hip s yst em a l s o I n v o l v e s t h e d i s t r i b u t i o n o f a f l a t gr an t* an a l t e r n a t i v e p r o c e d u r e f o r c a l c u l a t i n g a c o n s t i t u e n t d i s ­ t r i c t ' s r e i m b u r s e m e n t 1s g i v e n below. 1. The amount a v a i l a b l e 1s d i v i d e d by t h e number of s t u d e n t s e n r o l l e d 1n t h e ISD t o equal a f l a t - g r a n t amount. 2. The f l a t - g r a n t amount 1s t h e n m u l t i p l i e d by t h e number o f s t u d e n t s e n r o l l e d 1n each c o n s t i t u e n t s ch oo l d i s t r i c t t o equal I t s r e s p e c ­ tive payment. As e x p l a i n e d above* t h e p r o p o r t i o n a t e g e n e r a l membership d i s t r i b u ­ t i o n s y s t e m r e s u l t s 1n a f l a t - g r a n t amount b e i n g d i s b u r s e d t o c o n s ­ t i t u e n t sc h oo l d i s t r i c t s f o r each s t u d e n t ( g e n e r a l and s p e c i a l educa­ tion) enrolled. S i m i l a r d e g r e e s o f I n e q u i t y r e s u l t under t h i s s y s t e m a s w e r e r e p o r t e d 1n t h e f i n d i n g s f o r t h e f l a t - g r a n t system. The a r g u ­ m e n ts and d i s c u s s i o n f o r t h e f l a t - g r a n t s ys te m a l s o apply t o t h i s distribution sy stem. Weighted program c o s t d i s t r i b u t i o n s y s t e m . One ISD used a w e i g h t e d program c o s t d i s t r i b u t i o n system i n which fu nd s w er e d i s b u r s e d t o c o n s t i t u e n t school d i s t r i c t s on t h e b a s i s o f a f l a t - g r a n t amount t i m e s t h e number o f s t a f f (FTE) o f each t y p e of program a s w e i g h t e d t h e p r i o r - t h r e e - y e a r a v e r a g e program c o s t f o r each t y p e o f program across all d is tr ic ts . In s h o rt * t h i s method 1s a r e l a t i v e l y by 128 c o m p l i c a t e d v a r i a t i o n o f a f l a t - g r a n t d i s t r i b u t i o n sy st em . o t h e r f l a t - g r a n t systems# reimbursement. Unlike program c o s t s a r e c o n s i d e r e d 1n c a l c u l a t i n g However# l i k e o t h e r f l a t - g r a n t systems# t h e r e a r e no procedures t o account f o r th e d i f f e r i n g l e v e l s of basic per s tu d e n t s u p p o r t ( g r o s s membership a l l o w a n c e ) among d i s t r i c t s . To show t h e e f f e c t of t h e w e i g h t e d program c o s t d i s t r i b u t i o n system# a c o m p a r is o n o f t h i s s y st e m w i t h t h e s t a t e e x c e s s - c o s t d i s t r i b u t i o n s y st em 1s shown 1n T a b l e 14 f o r t h e h y p o t h e t i c a l ISD p r e s e n t e d 1n T a b l e 11. The sa m pl e c a l c u l a t i o n s f o r t h e w e i g h t e d program c o s t d i s t r i b u t i o n s y st e m a r e p r e s e n t e d T a b l e 15. As shown 1n T a b l e 14# f o r t h e w e i g h t e d program c o s t d i s t r i b u t i o n s y s t e m , D i s t r i c t A 1s pa i d 57% o f I t s u n r e i m b u r s e d c o s ts # D i s t r i c t B 1s p a i d 39% o f I t s u n r e i m b u r s e d c o s t s # and D i s t r i c t C 1s p a i d unreimbursed co s ts. 80% o f I t s S i m i l a r t o o t h e r f l a t - g r a n t systems# t h e w e i g h t e d program c o s t d i s t r i b u t i o n s y st em p r od u ce s c o n s i d e r a b l e I n e q u i t i e s among c o n s t i t u e n t sc ho ol d i s t r i c t s 1n t e r m s o f t h e am ounts r e i m b u r s e d . The a r g u m e n t s and d i s c u s s i o n f o r t h e f l a t - g r a n t s y st e m a l s o a p p l y t o t h e w e i g h t e d program c o s t d i s t r i b u t i o n system# e x c e p t t h a t 1 t 1s n o t easy t o understand. S u b s i d i a r y Q u e s t i o n 2 c . How do t h e r e a s o n s g iv e n f o r u s i n g an a l t e r n a t i v e method r e l a t e t o t h e e q u i t a b l e d i s t r i b u t i o n o f t h e s e f u n d s a s e m b o d i e d w i t h i n Rule 340.1811# s u b r u l e s (2)# (3)# and (4)? Findings. As r e p o r t e d 1n t h e f i n d i n g s f o r S u b s i d i a r y Q u e s t i o n Id# only tw o ISDs I n c l u d e d r e a s o n s f o r u s i n g an a l t e r n a t i v e method 1n t h e i r 129 T a b l e 14.— Comparison a n a l y s i s o f c o n s t i t u e n t d i s t r i c t r e i m b u r s e m e n t under Rule 3 4 0 . 1 8 1 1 , s u b r u l e s ( 2 ) , ( 3 ) , and ( 4 ) , and a w ei g h t e d program c o s t d i s t r i b u t i o n sy st em . D istrict A D istrict B D istrict £ $43,3 50 X.50 $21,675 $61,200 __ *.,£.0 $30,600 $12,750 X.5Q $ 6, 37 5 50% 50% 50% To ta l Unreimbursed C o s t s $43,3 50 $61,200 $12,750 Amount o f Reimbursement® $24,883 $23,584 $10,179 57% 39% 80% 0 0 0 + $ 3, 208 - $7,016 + $3,804 +7% -11% +30% S t a t e Excess C o s t System T ot al Unreimbursed C o s t s Times Like P ayo ut P e r c e n t Amount of Reimbursement P e r c e n t Unreimbursed C o s t s Weighted Program Co st Svstem P e r c e n t Unreimbursed C o s t s D i f f e r e n c e s Between Systems T ot al Unreimbursed C o s t s Amount o f Reimbursement P e r c e n t Unreimbursed C o s t s C a l c u l a t i o n s o f w e i g h t e d program c o s t d i s t r i b u t i o n sy st em a r e r e p o r t e d 1n T a b l e 15. 130 T a b l e 1 5 . - - C a l c u l a t i o n s f o r h y p o t h e t i c a l w e i g h t e d pr o g r a m c o s t d i s t r i b u t i o n s y s t e m . Professional S t a f f and T o ta l EMI P r o g r a m Dist A B C Totals El Prof Staff 3.0 1.0 1.0 $ 85,000 5.0 $135,000 Program Cost D a t a , Program by D i s t r i c t LD P r o g r a m Total Costs Prof Staff 0.0 Total Costs $ 25,000 $ 25,000 2.0 $ 80,000 0. 0 2.0 $ Prof Staff 1.0 1.0 Prof Staff 5.0 4.0 2. 0 $ 11*0 , 0 0 0 $ 60,000 4.0 $135,000 11 . 0 $350,000 2.0 0 $ 80,000 Totals Tota l Costs $ 65,000 $ 35,000 $ 35,000 Total Costs $150,000 C a l c u l a t i o n o f Pr ogram We i g h t s Total Costs $135,000 $ 80,000 $135,000 Prog EMI El LD 1. Prof Staff 5.0 2.0 4.0 T o t a l Ave Prog C o s t s '$ 5 1 , 8 1 8 $ 31,818 $ 31 , 8 1 8 F o r c a l c u l a t i n g p r o g r a m w e i g h t s , i t wa s a s s u m e d t h a t c o s t s r e f l e c t t h r e e - y e a r a v e r a g e program c o s t s . Total Average Program Costs $31,818 Total Prof Staff 5.0 2.0 4.0 Total Prog Weight X 0.8485 X 1.2571 X 1.0607 D ist Weights Prog W ei gh ts 0.81*85 1. 2571 1.0607 the c u r r e n t av e r a g e program Program C o s ts $350,000 Calculation of Prog EMI El LD Average Prog C o s ts $ 27,000 $ 40,000 $ 33,750 / Total / Prof S ta ff 11 . 0 t h e Amount o f a D i s t r i b u t i o n U n i t ES St D i s t Weight ■T*TI4T5‘ 2.5142 4.2428 = Amount A v a i l a b l e / T otal D ist Weights Amount o f D i s t U n i t $58,650 10.9995 $ 5,332 10.9995 Determining Total Amount o f R e i m b u r s e m e n t D istrict A Prog EMI El LD Prof Staff 3.0 0.0 2.0 X X X Prog Weight 6.8485 1. 2571 1.0607 m m KE T o t a l Number Dist Units 2.5455 0.0000 2.1214 Total Amount o f x D ist Unit x $ 5,332 x $ 5,332 x $ 5,332 Amount o f R e i m b u r s e m e n t D istrict Prog EMI El LD Prof Staff 1.0 2.0 1.0 X X X Prog We i g h t 7T. 8 4 8 5 1.2571 1.0607 SC «= s Prog EMI El LD Prof Staff 1.0 0.0 1.0 X X X Prog Weight 6,8485 1.2571 1.0607 s = m S s at Amount o f Reimbursement $ 4,5 24 $13,405 $ 5,655 $23,584 C T o t a l Number Dist Units 6".'B 485.. ... 0.0000 1.0607 Total SB B T o t a l Number Amount o f Dist Units x D ist Unit 6.8485 x $ 5,332 2.5142 x $ 5,332 x $ 5,332 1.0607 T o t a l Amount o f R e i m b u r s e m e n t D istrict ■ ■ Amount o f Reimbursement $ 13,572 $ 0 $ 1 1 . 31 1 $ 24,883 x x x x Amount o f D ist Unit $ 5,332 $ 5,332 $ 5,332 Amount o f R e i m b u r s e m e n t ■ ■ Amount o f Reimbursement $ 4,5 24 $ 0 $ 5,655 $10,179 131 s p e c ia l ed u ca tio n plans. One ISD 1n which a f l a t - g r a n t d i s t r i b u t i o n s ys te m was used f o r d i s b u r s i n g s p e c i a l e d u c a t i o n m l l l a g e f u n d s s t a t e d t h e f o l l o w i n g r e a s o n s w i t h i n t h e i r s p e c i a l e d u c a t i o n plan. R a t i o n a l e f o r t h e C u r r e n t . M e t h o d o f D i s t r i b u t i n g ________ I AD, S p e c i a l E d u c a ti o n Funds. T h i s method o f d i s t r i b u t i n g s p e c i a l e d u c a t i o n m l l l a g e fu n d s h a s been a d o p t e d f o r t h e f o l l o w i n g r e a s o n s : 1. I t does n o t v i o l a t e t h e p r i n c i p l e o f "added c o s t " r e i m b u r s e ­ ment. No school d i s t r i c t has r e c e i v e d — nor w i l l r e c e i v e — more money f o r t h e o p e r a t i o n o f s p e c i a l e d u c a t i o n pro gr ams and s e r v i c e s t h a n t h e t o t a l e x p e n d i t u r e s f o r t h o s e p r o g r a m s and s e r v i c e s . Re i m b u r s em en t from a l l s o u r c e s of f u n d i n g , I n c l u d i n g g r o s s membership a l l o w a n c e . S t a t e c a t e g o r i c a l a i d , f e d e r a l g r a n t s and I n t e r m e d i a t e f u n d s , 1s n o t a d e q u a t e t o m e e t t h e t o t a l c o s t o f s p e c i a l e d u c a t i o n pr og ra m s and s e r v i c e s f o r any one o f t h e ____ l o c a l c o n s t i t u e n t sc h oo l d i s t r i c t s . 2. The I n t e r m e d i a t e D i s t r i c t and a l l c o n s t i t u e n t school d i s t r i c t s h av e a g r e e d on t h i s method o f d i s t r i b u t i n g funds. 3. I t 1s r e l a t i v e l y s i m p l e t o a d m i n i s t e r . 4. I t allows th e I n te rm e d ia te D i s t r i c t t o d i s t r i b u t e t h e funds d u r i n g t h e c u r r e n t f i s c a l y e a r r a t h e r t h a n t h e f o l l o w i n g sch ool y e a r . T h i s t e n d s t o e a s e t h e ca s h flow p ro bl em s o f t h e c o n s t i t u e n t school d i s t r i c t s . Each o f t h e p r e c e d i n g r e a s o n s 1s b r i e f l y d i s c u s s e d 1n t h e f o l l o w i n g paragraphs. The f i r s t r e a s o n s t a t e d t h a t t h e f l a t - g r a n t d i s t r i b u t i o n s y st e m used by t h e ISD "does n o t v i o l a t e t h e p r i n c i p l e o f 'added c o s t ' r e i m ­ bu r s e m e n t " b e c a u s e t h e amount r e i m b u r s e d d i d n o t exceed t h e d i f f e r e n c e between r e c e i p t s and e x p e n d i t u r e s f o r s p e c i a l e d u c a t i o n pr o g ra m s and s e r v i c e s 1n any c o n s t i t u e n t sch oo l d i s t r i c t . T h i s 1s l i k e s t a t i n g t h a t bec a us e t h e payment 1s l e s s t h a n t h e u n r e i m b u r s e d c o s t s , t h e p r i n c i p l e o f "added c o s t " r e i m b u r s e m e n t 1s be in g u ph el d r e g a r d l e s s o f how t h e f u n d s m i g h t be p r o p o r t i o n e d among c o n s t i t u e n t d i s t r i c t s . Many would 132 q u e s t i o n such a d e f i n i t i o n o f t h e p r i n c i p l e o f a d d e d - c o s t r e i m b u r s e ­ ment. O t h e r s would b l u n t l y c o n s i d e r t h e d e f i n i t i o n abs ur d. In any c a s e , t h e p r i n c i p l e o f e q u i t y 1n t h e d i s t r i b u t i o n of s p e c i a l e d u c a t i o n m l l l a g e f u n d s , a s p r e v i o u s l y d e f i n e d , 1s n o t s u p p o r t e d by t h e s t a t e d premise. The second r e a s o n g i v e n was t h a t a l l c o n s t i t u e n t d i s t r i c t s had a g r e e d t o a f l a t - g r a n t d i s t r i b u t i o n sy st em . An a g r e e m e n t t o d i s t r i b u t e fu n d s I n an I n e q u i t a b l e manner does n o t n e g a t e t h e f a c t t h a t f u n d s w ere being d i s t r i b u t e d I n e q u i t a b l y . A f l a t - g r a n t s y s t e m ' s b e i n g a method t h a t 1s r e l a t i v e l y easy t o a d m i n i s t e r was p r o v i d e d a s t h e t h i r d r e a s o n . The r e s e a r c h e r r e c o g n i z e s t h e a d m i n i s t r a t i v e a d v a n t a g e s t o u s i n g a d i s t r i b u t i o n s ys te m t h a t 1s e a s i e r t o u n d e r s t a n d and 1n which t h e number o f c a l c u l a t i o n s 1s red u ce d In c o m p a r i s o n t o t h e s t a t e d i s t r i b u t i o n methods. Nevertheless, th e r e l a t i v e a d m i n i s t r a t i v e e a s e 1s v ie w ed a s a weak r a t i o n a l e f o r u s i n g a d i s t r i b u t i o n s y s t e m t h a t r e s u l t s 1n t h e I n e q u i t a b l e d i s t r i b u t i o n o f f u n d s among c o n s t i t u e n t d i s t r i c t s . The f o u r t h r e a s o n p r e s e n t e d was t h a t , by u s i n g a f l a t - g r a n t d i s ­ t r i b u t i o n s y s t e m , s u p p o r t fu nd s c o u l d be d i s b u r s e d s oo ne r t o con­ s t i t u e n t sch oo l d i s t r i c t s . P olitically, 1 t 1s p r o b a b ly p o p u l a r f o r c o n s t i t u e n t s c h o o l d i s t r i c t s t o r e c e i v e fu nd s s o o n e r r a t h e r t h a n l a t e r . However, 1 t 1s o f H t t l e co n s eq u en c e t o t h e e q u i t a b l e d i s t r i b u t i o n of s p e c i a l e d u c a t i o n m l l l a g e f u n d s when t h e a c t of d i s t r i b u t i o n t a k e s place. Sooner o r l a t e r , t h e r e s u l t 1s t h e I n e q u i t a b l e d i s t r i b u t i o n o f f u n d s unde r a f l a t - g r a n t sy st em . The ar g u m e n t 1s a l s o s u s p e c t b ec a u se 133 t h e r e 1s n o t h i n g t o p r e v e n t t i m e l y payment o f e s t i m a t e d c l a i m s o r ad v a n c e s o f such c l a i m s 1n any sy st em . The o t h e r ISD t h a t I n c l u d e d t h e r e a s o n s f o r d e s i r i n g an a l t e r n a ­ t i v e method p r a c t i c e d tw o v a r i a t i o n s from t h e s t a t e d i s t r i b u t i o n meth­ ods. Of t h e two p r a c t i c e s , one v a r i e d 1n t h e c a l c u l a t i o n o f r e c e i p t s , and t h e o t h e r v a r i e d 1n t h e manner of payment. These v a r i a t i o n s and t h e r e a s o n s gi v e n f o r t h e p r a c t i c e s a r e b r i e f l y d i s c u s s e d . In c a l c u l a t i n g r e c e i p t s f o r c l a s s r o o m programs a v a i l a b l e t o a l l c o n s t i t u e n t d i s t r i c t s ( c e n t e r p r o g r a m s ) , an a d d i t i o n a l s u b t r a c t i o n ( r e c e i p t ) was t a k e n f o r a l o c a l (resident) d i s t r i c t contribution for each s t u d e n t p la c e d 1n a c e n t e r program. The r a t i o n a l e g i v e n was t h a t t h i s p r a c t i c e would d i s c o u r a g e u n n e c e s s a r y p l a c e m e n t s 1n c e n t e r pr o­ grams. As note d e a r l i e r ( s e e d i s c u s s i o n o f t h e p r a c t i c e I n v o l v i n g an additional re c e ip t fo r a local d i s t r i c t c o n trib u tio n , p o s i t i o n was t a k e n on t h e e q u i t y o f t h i s p r a c t i c e . p. 121), no Also n o te d was t h a t t h e p a r t i c u l a r p r o c e d u r e employed 1n d e t e r m i n i n g t h e amount o f t h e l o c a l d i s t r i c t c o n t r i b u t i o n r e s u l t e d 1n a f l a t payment, and, a s a result, e q u i t y was redu ce d. However, t h e q u e s t i o n 1n t h i s c a s e 1s how t h e reasons fo r using th e p r a c t i c e r e l a t e t o t h e e q u i t a b l e d i s t r i b u t i o n o f funds. I f t h e amount o f t h e l o c a l d i s t r i c t ’s c o n t r i b u t i o n was d e t e r m i n e d t o be e q u i t a b l e ( f o r ex a m p le , a p e r c e n t a g e o f a d i s t r i c t ' s g r o s s membership a l l o w a n c e ) , and no s t u d e n t was d e n i e d a needed s e r v i c e b e c a u s e o f t h e amount o f t h e l o c a l d i s t r i c t ' s c o n t r i b u t i o n , t h i s prac­ t i c e and t h e r a t i o n a l e a r e s e e n a s c o m p a t i b l e w i t h t h e p r i n c i p l e s o f e q u i t y 1n t h e d i s t r i b u t i o n o f s p e c i a l e d u c a t i o n m l l l a g e funds. 134 The second p r a c t i c e v a r i e d In t h e manner o f payment* where a p r i o r i t y s y s t e m was used. Rul e 340.1811* s u b r u l e (4)» was c i t e d a s t h e l e g a l s u p p o r t and was t h e r e a s o n g i v e n f o r u s i n g a p r i o r i t i z e d payment sy st em . (See d i s c u s s i o n o f t h i s p r a c t i c e on p. 123.) F o l l o w i n g 1s t h e s t a t e m e n t made a t t h e c o n c l u s i o n o f t h e g r o u p i n g s f o r p r i o r i t i e s II* III, IV, a n d V. (R eimburs ement 1s d e p e n d e n t upon t h e adequacy o f I.S.D. funds t o make such pa y m e n ts — R u le 340.1811C4]). The f u l l t e x t of Rul e 340.1811, s u b r u l e (4) r e a d s : (4) When I n t e r m e d i a t e s ch oo l d i s t r i c t s p e c i a l e d u c a t i o n t a x fund s a r e I n s u f f i c i e n t t o r e i m b u r s e c o n s t i t u e n t d i s t r i c t c l a i m s 1n f u l l * a l i k e p e r c e n t a g e o f t h e c l a i m s h a l l be p a i d f o r s u p p o r t o f each program and s e r v i c e t o each c o n s t i t u e n t school d i s t r i c t . C la im s f o r t h e o p e r a t i o n o f s p e c i a l e d u c a t i o n p ro g ram s and s e r v i c e s a v a i l a b l e t o a l l c o n s t i t u e n t sch ool d i s t r i c t s may be r e i m b u r s e d 1n f u l l b e f o r e any p r o r a t e d payment which may become n e c e s s a r y f o r o t h e r pr o gr am s and s e r v i c e s . The p r o v i s i o n s o f t h i s s u b r u l e s t a t e t h a t a H k e - p e r c e n t o f t h e u n r e i m b u r s e d c o s t s w i l l be p a i d f o r each program 1n each c o n s t i t u e n t d istrict. C itin g t h i s su b ru le as t h e reason f o r using a p r i o r i t i z e d payment s y s t e m was a m i s i n t e r p r e t a t i o n o f t h e p r o v i s i o n s . A priori­ t i z e d payment s ys te m r e s u l t s 1n f u n d s be in g d i s b u r s e d 1n a v a r y i n g pay ou t p e r c e n t a g e . T h i s v i o l a t e s t h e me thods f o r t h e e q u i t a b l e d i s t r i ­ b u t i o n o f fund s c o n t a i n e d 1n s u b r u l e (4), which c a l l f o r a f u l 1 - s u p p o r t o r H k e - p e r c e n t payment t o each program i n each c o n s t i t u e n t sc h o o l d1strict. 135 R es ea r c h Q u e s t i o n 3 What was t h e e f f e c t o f any d i s c r e p a n c i e s by ISDs i n f o l l o w i n g Michigan S p e c i a l E d u c a t i o n Rule 340.1812 a s r e l a t e d t o t h e p r i n ­ c ip le of equ itable d is tr ib u tio n ? In te n tio n of Inquiry Rule 340.1812, c o m p r i s i n g t w o s u b r u l e s * g o v e r n s ISD u s e o f s p e c i a l e d u c a t i o n m i l l age f u n d s f o r p ro g ram s and s e r v i c e s o p e r a t e d by t h e ISD. T h i s r u l e c o n t a i n s p r o v i s i o n s t o e n s u r e t h a t w h e t h e r a program o r s e r v i c e 1s pr o v id ed by t h e ISD o r a c o n s t i t u e n t sc h oo l d i s t r i c t * the same l e v e l o f s p e c i a l e d u c a t i o n m i l l age s u p p o r t w i l l be p r o v id e d . The I n t e n t i o n o f t h i s I n q u i r y was t o d i s c o v e r t o w h a t e x t e n t e q u i t y 1s a f f e c t e d by any ISDs t h a t w e r e n o t c o m p ly in g w i t h t h e s e p r o v i s i o n s . S u b s i d i a r y Q u e s ti o n 3 a . How many ISDs w ere n o t f o l l o w i n g Rule 340.1812, s u b r u l e s (1) a n d / o r (2)? Findings. 1n T a b l e S u b r u l e (1) 1s an o p t i o n a l rule, and* as was r e p o r t e d 5* a l l 39 d i s t r i c t s t o which 1 t a p p l i e d e l e c t e d t o f o l l o w t h e o p t i o n a l p r o v l s o n s of f i r s t p ay i n g ISD c o s t s f o r s p e c i a l e d u c a t i o n pr ograms and s e r v i c e s a v a i l a b l e t o a l l c o n s t i t u e n t d i s t r i c t s , b e f o r e p r o r a t i n g r e i m b u r s e m e n t f o r o t h e r s p e c i a l e d u c a t i o n pr o gr am s and services. Subrule but not a l l , (2) r e q u i r e s ISDs t h a t p r o v i d e d i r e c t s e r v i c e s 1n some, c o n s t i t u e n t school d i s t r i c t s t o b i l l th o se d i s t r i c t s r e c e i v i n g d i r e c t s e r v i c e s f o r t h e d i f f e r e n c e be tw ee n t h e t o t a l u n r e im ­ bu rs ed c o s t s and t h e l e v e l o f s u p p o r t p r o v i d e d t o o t h e r c o n s t i t u e n t school d i s t r i c t programs. As shown 1n T a b l e 5, o f t h e 21 d i s t r i c t s 1n 136 which t h i s s u b r u l e ap p l ie d * t e n were n o t f o l l o w i n g t h e r e q u i r e d p r o ­ visions. S u b s i d i a r y Q u e s t i o n 3 b . How 1s t h e p r i n c i p l e o f e q u i t a b l e d i s ­ t r i b u t i o n a f f e c t e d by ISDs* 1f any, t h a t were n o t f o l l o w i n g Rul e 340.1812, S u b r u l e s (1) a n d / o r (2)? F i n d i n g s. S u b r u l e (1) a l l o w s an ISD t o pay f i r s t I t s own c o s t s f o r p r o v i d i n g pr o gr am s and s e r v i c e s a v a i l a b l e t o a l l c o n s t i t u e n t school districts, before pro ratin g th e c o s ts for other special education pr o gr am s and s e r v i c e s . The f o l l o w i n g ex am p le shows t h a t t h i s o p t i o n a l l o w s b i l l i n g s t o be avo id ed and r e s u l t s 1n t h e same l e v e l o f s u p p o r t a s does t h e p r a c t i c e of p r o r a t i n g pay m ent s f o r a l l u n r e i m b u r s e d c o s t s (Mange, 1 9 8 4 ) . 1. An ISD ha s $1,000,000 o f s p e c i a l e d u c a t i o n m l l l a g e f u n d s a v a i l a b l e t o s u p p o r t s p e c i a l e d u c a t i o n pr ograms and s e r v i c e s . 2. The t o t a l u n r ei m b ur se d c o s t s f o r s p e c i a l e d u c a t i o n programs and s e r v i c e s ( a f t e r s u b t r a c t i n g s t a t e membership and c a t e g o r i c a l a i d r e c e i p t s ) a r e as follow s. Pro gram s A v a i l a b l e t o a l l Constituent D is tric ts $ 5 00, 00 0 3. O th er S p e c i a l E d u c a ti o n Programs and S e r v i c e s + $ 1,000,000 T ot al Unrelmb Costs = $ 1,500,000 S p e c i a l e d u c a t i o n m l l l a g e fund r ei m b ur se m en t a l t e r n a t i v e s : a. Paving t h e f u l l u n r e i m b u r s e d c o s t s o f pro gra ms and s e r v i c e s available to all co n stitu en t d is t r i c ts before p ro ratin g th e pay men ts f o r o t h e r c o n s t i t u e n t d i s t r i c t pro gr ams a n d s e r v l c e s . The ISD pays t h e f u l l $500,000 u n r e i m b u r s e d c o s t s o f p ro gr am s 137 and s e r v i c e s a v a i l a b l e t o a l l c o n s t i t u e n t sch oo l d i s t r i c t s first. Then w i t h t h e $500,000 r e m a i n i n g , a 50% pay o u t 1s made t o s u p p o r t t h e $1,000,000 of u n r e i m b u r s e d c o s t s f o r o t h e r s p e c i a l e d u c a t i o n pr o gr am s and s e r v i c e s , b. P r o r a t i n g t h e t o t a l u n r e i m b u r s e d c o s t s , t h e n b i l l i n g con­ s t i t u e n t d i s t r i c t s f o r t h e remaining unreimbursed c o s t s fo r p r o g r a m s and s e r v i c e s a v a i l a b l e t o a l l c o n s t i t u e n t d i s t r i c t s . The ISD d e t e r m i n e s t h a t t h e a v a i l a b l e s p e c i a l e d u c a t i o n m l l l a g e funds w i l l cover only tw o -th 1 rd s of t h e t o t a l unreimbursed costs ($1,000,000 o f $1,500,000). C onstituent d i s t r i c t s are b i l l e d f o r o n e - t h 1 r d o f t h e u n r e i m b u r s e d program c o s t s f o r p r o g r am s a v a i l a b l e t o a l l c o n s t i t u e n t d i s t r i c t s which e q u a l s $166,666.66. All o t h e r u n r e i m b u r s e d c o s t s a r e p a i d o f f a t 66-2/3% which r e s u l t s 1n $333,333.34 f o r pr o gr am s a v a i l a b l e t o a l l c o n s t i t u e n t d i s t r i c t s and $666,666,66 f o r o t h e r s p e c i a l e d u c a t i o n pr og ram s and s e r v i c e s . 4. Net amount o f s p e c i a l e d u c a t i o n m l l l a g e fu n d s a v a i l a b l e t o s u p p o r t p ro g r am s and s e r v i c e s a v a i l a b l e t o a l l c o n s t i t u e n t s c h o o l d i s ­ tricts: a. Under 3 a above: $ 500, 000 b. Under 3b above: $ 1 6 6 , 6 6 6 .6 6 +333#333,34 $ 500,000 138 5. Net amount a v a i l a b l e t o s u p p o r t o t h e r s p e c i a l e d u c a t i o n programs and s e r v i c e s : a. Under 3 a abov e: $ 500»000 b. Under 3b ab ove : $ 666,666.66 - 166 , 666 ,66 $ 50 0,000 As shown 1n t h e ex am ple above, when t h e ISD f i r s t pays I t s own c o s t s f o r p r o v i d i n g s p e c i a l e d u c a t i o n pro gra ms and s e r v i c e s a v a i l a b l e t o a l l c o n s t i t u e n t school d i s t r i c t s and t h e n p r o r a t e s t h e r e m a i n i n g f u n d s , 1 t r e s u l t s 1n t h e same a c t u a l amount o f r e i m b u r s e m e n t a s p r o ­ r a t i n g r e i m b u r s e m e n t f o r a l l prog ram s and s e r v i c e s and t h e n b i l l i n g t h e c o n s t i t u e n t school d i s t r i c t s f o r t h e rem aining unreimbursed c o s t s fo r t h e pr og r am s and s e r v i c e s a v a i l a b l e t o a l l c o n s t i t u e n t d i s t r i c t s . f i r s t method 1s more e f f i c i e n t b ec a u se b i l l i n g 1s avoided. a c t u a l amount of r e i m b u r s e m e n t a l l o w e d by s u b r u l e (1) has 1985). In e i t h e r c a s e , 1s t h e same 1nboth c a s e s , The Because t h e th e option been embodied w i t h i n Rul e 340.1812 (Mange, t h e e q u i t y 1n t h e d i s t r i b u t i o n o f s p e c i a l e d u c a t i o n m l l l a g e f u n d s 1s I d e n t i c a l . s u b r u l e (1) t o a v o i d b i l l i n g s , The a d v a n t a g e s , a s a l lo w e d by a r e s u p p o r t e d by t h e f a c t t h a t a l l 39 ISDs f o r which t h e s u b r u l e 1s a p p l i c a b l e have e l e c t e d t o f o l l o w t h i s option. S u b r u l e (2) r e q u i r e s ISDs w h er e pay m ent s t o c o n s t i t u e n t school d i s t r i c t s a r e p r o r a t e d and where d i r e c t s e r v i c e 1s p r o v i d e d 1n some, but not a l l , c o n s t i t u e n t school d i s t r i c t s t o b i l l t h o s e d i s t r i c t s r e c e i v i n g t h e d i r e c t s e r v i c e f o r t h e d i f f e r e n c e betwe en t h e t o t a l u n r e i m b u r s e d c o s t s and t h e l e v e l of s u p p o r t p r o v i d e d t o a l l o t h e r 139 constituent d is tric ts . This p ro v is io n p r o t e c t s d i s t r i c t s t h a t provide t h e i r own p ro g ram s and s e r v i c e s from h a v i n g t o pay a l a r g e r s h a r e of t h e i r unreimbursed c o s t s th a n d i s t r i c t s t h a t r e c e iv e th e s e s e r v i c e s from t h e ISD. lated/ To g i v e an e x a m p le o f how t h i s s u b r u l e m i g h t be v i o ­ su pp os e an ISD o p e r a t e s sc ho ol p s y c h o l o g i s t s e r v i c e s f o r f o u r of I t s s i x c o n s t i t u e n t s ch oo l d i s t r i c t s # and t h e r e m a i n i n g two d i s t r i c t s o p e r a t e t h e i r own sc h oo l p s y c h o l o g i s t s e r v i c e s . I f t h e ISD f i r s t p a i d I t s own c o s t s f o r o p e r a t i n g t h e sc h o o l p s y c h o l o g i s t program and t h e n p r o r a t e d t h e c o s t s o f t h e sch oo l p s y c h o l o g i s t employed by t h e tw o d i s t r i c t s o p e r a t i n g t h e i r own programs# f o u r d i s t r i c t s would pay n o t h ­ i n g and tw o would be r e s p o n s i b l e f o r t h e d i f f e r e n c e be tw ee n t h e i r u n r e im b u r s e d c o s t s and t h e amount o f t h e p r o r a t i o n . A major d is c r e p ­ ancy 1n e q u i t y among t h e c o n s t i t u e n t d i s t r i c t s would o cc u r . a g a i n s t t h i s ty p e of Inequity# To p r o t e c t s u b r u l e (2) r e q u i r e s t h a t t h e f o u r c o n s t i t u e n t d i s t r i c t s be b i l l e d f o r t h e d i f f e r e n c e betwe en t h e t o t a l e x p e n d i t u r e s f o r t h e ISD t o p r o v i d e them scho ol p s y c h o l o g i s t s e r v i c e s and t h e amount o f p r o r a t e d s u p p o r t t h a t 1s p r o v i d e d t o s u p p o r t a l l o t h e r c o n s t i t u e n t d i s t r i c t p r og r am s and s e r v i c e s . The I n t e n d e d e f f e c t 1s t o p r o v i d e e q u i t y by r e q u i r i n g t h e same l e v e l of s u p p o r t and t h e same l e v e l o f r e m a i n i n g u n r e i m b u r s e d c o s t s among a l l c o n s t i t u e n t districts. As r e p o r t e d 1n t h e f i n d i n g s f o r S u b s i d i a r y Q u e s t i o n 3b# 10 o f t h e 21 ISDs t h a t p r o v i d e d d i r e c t s e r v i c e s 1n some b u t n o t a l l c o n s t i t u e n t school d i s t r i c t s w e r e n o t f o l l o w i n g t h e p r o v i s i o n s o f t h i s s u b r u l e . Thi s p r a c t i c e r e s u l t s 1n m a j o r r e i m b u r s e m e n t I n e q u i t i e s among co n - 140 R es ear ch Q u e s t i o n 4 What h a s t h e Michigan D ep ar tm en t o f E d u c a t i o n done t o e n s u r e t h a t ISDs f o l l o w M ich ig an S p e c i a l E d u c a ti o n R u le s 340.1811 and 340.1812, which g ove rn t h e d i s t r i b u t i o n and use of s p e c i a l e d u c a t i o n m l l l a g e f un ds ? Intention, of Inquiry The Michigan S t a t e Board o f E d u c a ti o n has pr o m u lg at ed r u l e s t h a t govern t h e d i s t r i b u t i o n and use of s p e c i a l e d u c a t i o n m l l l a g e fu n d s . The I n t e n t i o n o f t h i s I n q u i r y was t o d i s c o v e r t o w h at e x t e n t p r o c e d u r e s w ere 1n p l a c e a t t h e s t a t e l e v e l t o e n s u r e t h a t ISDs d i s t r i b u t e s p e c i a l e d u c a t i o n m l l l a g e fu n ds e q u i t a b l y t o c o n s t i t u e n t school d i s t r i c t s , as r e q u i r e d by Ru le s 340.1811 and 340.1812. S u b s i d i a r y Q u e s t i o n 4 a . What c r i t e r i a w e re used by t h e Michi gan D e p a r tm e n t o f E d u c a t i o n t o a pp r ov e a l t e r n a t i v e methods f o r d i s t r i b ­ u t i n g s p e c i a l e d u c a t i o n m l l l a g e fun ds t h a t had been s u b m i t t e d f o r a p p r o v a l (Rule 340.1811 C7]) a s p a r t o f an ISD s p e c i a l e d u c a t i o n p la n ? F i n d i n g s . The I n t e r v i e w with t h e d e s i g n e e o f t h e D epartment o f E d u c a t i o n D i r e c t o r o f S p e c i a l E du ca ti on r e v e a l e d t h a t no w r i t t e n c r i ­ t e r i a o r p r o c e d u r e s w e r e 1n p l a c e t o app ro v e o r d i s a p p r o v e an a l t e r n a ­ t i v e method f o r d i s t r i b u t i n g s p e c i a l e d u c a t i o n m l l l a g e f u n d s t h a t had been s u b m i t t e d f o r a p p r o v a l a s p a r t o f an ISD s p e c i a l e d u c a t i o n pl a n . T h i s 1s r e p o r t e d 1n a l e t t e r s u m m a r iz in g t h e I n t e r v i e w , which was s e n t t o t h e D e p a r t m e n t d e s i g n e e f o l l o w i n g t h e I n t e r v i e w (Appendix J ) . In t h e r e s p o n s e l e t t e r r e c e i v e d from t h e d e s i g n e e (Appendix K), he s t a t e d t h a t c e r t a i n c r i t e r i a would have t o be met f o r an a l t e r n a t i v e method t o be app roved. F i v e s p e c i f i c c r i t e r i a w ere l i s t e d . However, 141 no I n d i c a t i o n was g iv e n t h a t any p r o c e d u r e s e x i s t e d t o e n s u r e t h a t an a l t e r n a t i v e method s u b m i t t e d f o r ap pr o va l a s p a r t o f an ISD s p e c i a l e d u c a t i o n p la n c o m p l i e d w i t h any o f t h e s t a t e d c r i t e r i a . F u r t h e r I n v e s t i g a t i o n r e v e a l e d t h a t t h e S t a t e D e p a r tm e n t of Educa­ t i o n d e t e r m i n e d a r ec o m m en d at io n f o r a p p r o v a l o r d i s a p p r o v a l o f a s p e c i a l e d u c a t i o n p l a n a c c o r d i n g t o a 1 1 s t o f r e q u i r e m e n t s c o n t a i n e d on a c h e c k l i s t by which each p l a n was r e v i e w e d and e v a l u a t e d (Appendix L). T h i s 1 1 s t o f r e q u i r e m e n t s d id n o t I n c l u d e t h e r ev ie w o r e v a l u a t i o n o f an a l t e r n a t i v e method f o r d i s t r i b u t i n g s p e c i a l e d u c a t i o n m l l l a g e fu nd s t h a t had been s u b m i t t e d f o r ap pr o va l a s p a r t of an ISD s p e c i a l educa­ t i o n pla n. Therefore* r e g a r d l e s s of th e c r i t e r i a necessary f o r a p p r o v a l , an a l t e r n a t i v e method f o r d i s t r i b u t i n g s p e c i a l e d u c a t i o n m l l l a g e f u n d s t h a t had been s u b m i t t e d f o r ap p r o v al a s p a r t o f an ISD s p e c i a l e d u c a t i o n p l a n a p p e a r s t o have been a u t o m a t i c a l l y approved by d e f a u l t b e c a u s e t h e r e a r e no w r i t t e n c r i t e r i a f o r e v a l u a t i o n o f an a l t e r n a t i v e method and no s p e c i f i c e n t r i e s 1n t h e c h e c k l i s t f o r p la n approval p e r t a i n i n g t o t h e d i s t r i b u t i o n of s p e c ia l education m llla g e funds. Subsidiary undertaken ISDs w e r e go v er n t h e Q u e s t i o n 4 b . What m o n i t o r i n g a c t i v i t i e s have been by t h e Michigan D e p a r tm e n t o f E d u c a ti o n t o e n s u r e t h a t 1n c o m p l i a n c e w i t h R u le s 340.1811 and 340.1812, which d i s t r i b u t i o n o f s p e c i a l e d u c a t i o n m l l l a g e f un ds ? F i n d i n g s . The i n t e r v i e w w i t h t h e D ep ar tm en t o f E d u c a ti o n D i r e c t o r o f S p e c i a l E d u c a t i o n d e s i g n e e r e v e a l e d t h a t no m o n i t o r i n g 1s c u r r e n t l y b e i n g done r e l a t e d t o R u l e s 340.1811 and 340.1812. T h i s 1s r e p o r t e d 1n a l e t t e r s u m m a r i z i n g t h e I n t e r v i e w , which was s e n t t o t h e d e s i g n e e 142 f o l l o w i n g t h e I n t e r v i e w (Appendix J). In a r e s p o n s e l e t t e r r e c e i v e d from t h e d e s i g n e e (Appendix K), he s t a t e d , " S p e c ia l E d u c a t i o n S e r v i c e s does n o t ' m o n i t o r t h e a p p l i c a t i o n ' o f R340.1811 o r R340.1812." The l e t t e r wen t on t o say: What t h e D e p a r tm e n t d oe s 1s r e v ie w and ap p r o v e c o s t s t h a t a r e r e i m b u r s a b l e . These c o s t s t h e n become t h e b a s i s f o r t h e r e c e i p t o f s t a t e a i d and t h e b a s i s f o r t h e d i s t r i b u t i o n o f I n t e r m e d i a t e m l l l a g e . Remember, t h e c r i t e r i a f o r t h e d i s t r i b u t i o n o f I n t e r m e ­ d i a t e m l l l a g e 1n R340.181H1) a r e t h a t t h e m l l l a g e w i l l o nl y be used f o r pro gra ms "a ppr oved f o r r e i m b u r s e m e n t by t h e D ep art m en t. " T h e r e 1s g e n e r a l l y no need f o r t h e D e p a rt m e n t o f E d u c a ti o n t o m onitor th e Im plem entation of t h i s r u l e sin c e t h e r e s p o n s i b i l i t y f o r a c c o u n t i n g f o r t h e d i s t r i b u t i o n o f fu nds by s t a t u t e r e s t s w i t h t h e I n t e r m e d i a t e bo a rd o f e d u c a t i o n . The I n t e r m e d i a t e b o a r d , a s I n d i c a t e d 1n P a r t 7 o f t h e School Code, h a s r e s p o n s i b i l i t y f o r t h e m a i n t e n a n c e and c o n t r o l o f fu nd s con­ s i s t e n t w i t h t h e law. S e c t i o n 622 o f t h e School Code r e q u i r e s t h e I n t e r m e d i a t e board t o s e t up a s e t o f a c c o u n t s approved by t h e S t a t e Board and t o h av e I t s books a u d i t e d a n n u a l l y . Under t h e s u p e r v i s i o n and c o n t r o l p r o v i s i o n s ( S e c t i o n 611), t h e I n t e r m e d i a t e board 1s r e s p o n s i b l e f o r t h e o v e r a l l o p e r a t i o n and e x p e n d i t u r e o f f u n d s c o n s i s t e n t w i t h s t a t e law and r u l e s . The I n t e r m e d i a t e s u p e r i n t e n d e n t , a s t h e c h i e f e x e c u t i v e o f f i c e r , 1s r e s p o n s i b l e t o t h e board f o r t h e a d m i n i s t r a t i o n o f fu n ds a s p a r t o f t h e p e r f o r m ­ ance o f d u t i e s r e q u i r e d un d e r S e c t i o n 153. I n t e r m e d i a t e d i s t r i c t s s u b m i t t o t h e D ep ar tm en t o f E d u c a t i o n a copy o f t h e i r a u d i t . D e p a r tm e n t S e r v i c e s r e v i e w s each a u d i t ; and 1f t h e r e a r e any f i n d i n g s t h a t I n d i c a t e d i s c r e p a n c i e s 1n d i s t r i b u t i o n o f funds r e l a t e d t o s p e c i a l e d u c a t i o n , t h e s e a r e f o r w a r d e d t o our o f f i c e f o r r e v i e w . These n o r m a l l y d ea l w i t h d i s c r e p a n c i e s and d i s t r i b u t i o n o f f e d e r a l funds. I t 1s t h e r e s p o n s i b i l i t y o f t h e I n t e r m e d i a t e d i s t r i c t board o f e d u c a t i o n and t h e s u p e r i n t e n d e n t a s t h e i r e x e c u t i v e o f f i c e r t o a s s u r e t h a t t h e fu n ds a r e d i s t r i b u t e d 1n a c c o r d a n c e w i t h r u l e s p ro m u l g a te d by t h e De pa rtm en t. The D e p a r tm e n t a p p r o v e s t h e c o s t s f o r which fu nd s can be d i s t r i b u t e d and t h e school d i s t r i c t a u d i t o r s ho ul d be t e s t i n g t h e e x p e n d i t u r e s o f f u n d s a c c o r d i n g t o those costs. I f t h e r e 1s a c o m p l a i n t , t h e D e p a r tm e n t can I n v e s t i g a t e un d er s p e c i a l e d u c a t i o n r u l e s and can c o m p l e t e a f i s c a l a u d i t u n d e r S e c t i o n R380.1281 of t h e School Code. 143 Some would d i s a g r e e w i t h t h e p re m i s e t h a t t h e r e 1s no need f o r t h e S t a t e D e p a r tm e n t of E d u c a ti o n t o m o n i t o r t h e a p p l i c a t i o n o f R u le s 340.1811 and 340.1812. O t h e r s would a l s o q u e s t i o n w h e t h e r t h e r e s p o n ­ s i b i l i t y r e s t s w i t h t h e ISD b o a r d s o f e d u c a t i o n t o m o n i t o r t h e m s e l v e s . The D e p a r tm e n t does m o n i t o r o t h e r a r e a s o f program o p e r a t i o n , even though t h e r e s p o n s i b i l i t y t o a c t 1n c o m p l i a n c e w i t h r e g u l a t i o n s r e s t s w i t h t h e d i s t r i c t and t h e s u p e r i n t e n d e n t a s t h e i r e x e c u t i v e o f f i c e r . Hence, t h i s p o s i t i o n 1s n o t c o n s i s t e n t w i t h D ep art m ent p r a c t i c e 1n th e se o th e r areas. The f i n d i n g s o f t h i s s tu d y I n d i c a t e t h a t t h e r e a r e m a j o r v a r i a ­ t i o n s among ISDs 1n t h e a p p l i c a t i o n o f Rule s 340.1811 and 340.1812. The S t a t e D e p a r tm e n t o f E d u c a t i o n does n o t a p p e a r t o be engaged 1n m onitoring t h e a p p l i c a t i o n of th e s e ru les. CHAPTER V CONCLUSIONS AND RECOMMENDATIONS Introduction To a v o i d p o s s i b l e m i s i n t e r p r e t a t i o n o f t h e c o n c l u s i o n s o f t h i s s tudy# a b r i e f d i s c u s s i o n o f t h e d i s t i n c t i o n between e q u i t y 1n t h e d i s t r i b u t i o n o f s u p p o r t f u n d s and t h e q u a l i t y o f e d u c a t i o n a l programs I s g iv e n . E q u i t y 1s b as ed on t h e c o n c e p t o f f a i r t r e a t m e n t In f i n a n ­ c i a l s u p p o r t # 1n which t h e a v a i l a b l e m o n e ta r y r e s o u r c e s a r e p a r t i t i o n e d 1n such a way among t h o s e r e c e i v i n g s u p p o r t t h a t none 1s ad v an t ag ed o r disadvantaged. S p e c i a l e d u c a t i o n m l l l a g e f u n d s a r e r a i s e d from a le v y v o t e d by t h e e l e c t o r s o f an ISD. These fu nd s a r e p r o v i d e d t o s u p p o r t t h e u n r e i m b u r s e d e x c e s s c o s t s o f e d u c a t i o n a l pr o gr am s and s e r v i c e s f o r a l l t h e h a n d i c a p p e d c h i l d r e n o f t h e ISD. Under t h e p r i n c i p l e o f eq u i ty # no c o n s t i t u e n t s ch oo l d i s t r i c t 1s t o be ad v an t ag ed o r d i s a d v a n ­ t a g e d 1n r e c e i v i n g I t s s h a r e o f s p e c i a l e d u c a t i o n m l l l a g e s u p p o r t f o r t h e e d u c a tio n of handicapped c h ild re n . However, e q u i t y s h o u ld n o t be c o n f u s e d w i t h t h e q u a l i t y o f e d u c a t i o n a l programs. Some m i g h t assume t h a t # when I n e q u i t y o c c u r s 1n t h e d i s t r i b u t i o n o f s p e c i a l e d u c a t i o n funds# t h e q u a l i t y o f s p e c i a l e d u c a t i o n pr o gr am s and s e r v i c e s 1s affected. T h i s c a n n o t be assumed. E q u i ty 1n t h e d i s t r i b u t i o n of fun ds and t h e q u a l i t y o f e d u c a t i o n a l pro gr ams a r e d i f f e r e n t measures# which o c c u r on tw o d i f f e r e n t p h i l o s o p h i c a l p l a n e s t h a t a r e n o t n e c e s s a r i l y lMt 145 linked. Re ade rs a r e urged t o a v o i d U n k i n g t h e two t e r m s when c o n s i d ­ e r i n g t h e c o n c l u s i o n s o f t h i s s tu d y . Concluslons Conclusion 1 ISDs t h a t have e l e c t e d t o d i s t r i b u t e s p e c i a l e d u c a t i o n m l l l a g e f u n d s by an a l t e r n a t i v e method t o t h e d i s t r i b u t i o n s y st e m embodied w i t h i n t h e Michi gan S p e c i a l E d u c a ti o n R u le s s h o u l d be r e q u i r e d t o comply w i t h t h e p r o v i s i o n s o f R u le 340.1811* s u b r u l e (7). Discussion Michigan S p e c i a l E d u c a t i o n Rule 340.1811* s u b r u l e (7), a l l o w s an ISD t o u s e an a l t e r n a t i v e method t o t h e s t a t e e x c e s s - c o s t s ys te m embodied 1n t h e R u le s f o r d i s t r i b u t i n g s p e c i a l e d u c a t i o n fu n ds 1f t h e a l t e r n a t i v e method and t h e r e a s o n s f o r s o u s i n g a r e s u b m i t t e d f o r ap pr ov al a s p a r t o f t h e ISD's s p e c i a l e d u c a t i o n pla n. The p u rp o s e of t h i s s u b r u l e 1s t o a l lo w ISDs t h e f l e x i b i l i t y o f d e v i s i n g v a r i o u s a l t e r n a t i v e methods t h a t m i g h t be more a p p r o p r i a t e t o t h e i r s p e c i f i c ne ed s 1n d i s t r i b u t i n g s p e c i a l e d u c a t i o n m l l l a g e f u n d s t o t h e i r con­ s t i t u e n t sch oo l d i s t r i c t s . The s u b r u l e 1s I n t e n d e d t o p r o t e c t e q u i t y by r e q u i r i n g t h a t any a l t e r n a t i v e method and t h e r e a s o n s t h e r e f o r be s u b m i t t e d f o r s t a t e a p p r o v a l 1n an ISD’s s p e c i a l e d u c a t i o n pla n. The s u b r u l e was e x p e c t e d t o f o r c e t h e Michigan D ep ar tm en t o f E d u c a ti o n t o a d o p t c r i t e r i a f o r ap p ro v al c o n s i s t e n t w i t h t h e p r i n c i p l e o f e q u i t y p r o v i d e d 1n p r e v i o u s l e g i s l a t i o n and 1n o t h e r p a r t s o f t h e Rule (Mange, 1 98 5) . 146 ISD s p e c i a l e d u c a t i o n p l a n s mu st be d ev el o pe d 1n c o o p e r a t i o n w i t h a l l c o n s t i t u e n t sch ool d i s t r i c t s , as w el l a s a p a r e n t a d v i s o r y com mi t­ tee. T h e r e f o r e , any a l t e r n a t i v e method f o r d i s t r i b u t i n g s p e c i a l e du ca ­ t i o n f u n d s mu st be p r e s e n t e d f o r t h e r ev ie w o f a l l l o c a l d i s t r i c t s and a p a r e n t a d v i s o r y c o m m i t t e e b e f o r e being p r e s e n t e d t o t h e s t a t e f o r approval. Th is p r o c e s s would a p p e a r t o p r o v i d e both a r e a s o n a b l e amount o f f l e x i b i l i t y 1n t h e d ev el op m en t and us e o f an a l t e r n a t i v e s p e c i a l e d u c a t i o n m l l l a g e d i s t r i b u t i o n s ys te m and an a p p r o v a l p r o c e d u r e t h a t would p r o t e c t a g a i n s t d e v e l o p i n g a d i s t r i b u t i o n s y st e m 1n which e q u i t y 1n t h e d i s b u r s e m e n t o f t h e s e f u n d s 1s u n n e c e s s a r i l y reduc ed . However, many ISDs t h a t used an a l t e r n a t i v e method t o d i s t r i b u t e s p e c i a l e d u c a t i o n m l l l a g e fu n ds were found t o be I g n o r i n g t h e r e q u i r e ­ ment t o s u b m i t t h e a l t e r n a t i v e method and t h e r e a s o n s f o r I t s use t o t h e s t a t e f o r ap p r o v al as p a r t o f t h e i r s p e c i a l e d u c a t i o n p l a n s . As p r e s e n t e d 1n t h e summary d i s c u s s i o n f o r Research Q u e s t i o n 1 and r e p o r t e d 1n T a b l e 5 , 33 ISDs e l e c t e d t o d i s t r i b u t e s p e c i a l e d u c a t i o n m l l l a g e fun ds by an a l t e r n a t i v e method. Of t h e s e 33 d i s t r i c t s , o n ly 17 had s u b m i t t e d t h e a l t e r n a t i v e method in t h e i r s p e c i a l e d u c a t i o n p l a n s . F i f t e e n o f t h e 17 d i s t r i c t s d id n o t I n c l u d e t h e r e q u i r e d r e a s o n s f o r u s i n g an a l t e r n a t i v e method. T h e r e f o r e , o n l y 2 o f t h e 33 ISDs 1n which an a l t e r n a t i v e method was bei ng used w ere co m p ly in g w i t h t h e r e q u i r e ­ ment t h a t t h e a l t e r n a t i v e method and t h e r e a s o n s t h e r e f o r be s u b m i t t e d f o r s t a t e ap pr o v al a s p a r t of t h e i r s p e c i a l e d u c a t i o n p l a n s . Whatever p r o c e d u r e s w ere 1n p l a c e t o m o n i t o r c o m p l i a n c e w i t h R ul e 340.1811, 147 s u b r u l e (7), a p p e a r t o be I n e f f e c t i v e bec a us e many d i s t r i c t s hav e been Ignoring th e requirem ents. C o n c l u si o n 2 The Michigan D e p a r tm e n t o f E d uc a ti o n s h o u ld r e q u i r e ISDs t o comply w i t h Rule 340.1812, s u b r u l e (2), 1n c a s e s 1n which d i r e c t s e r v i c e 1s p r o v i d e d f o r some, b u t n o t a l l , c o n s t i t u e n t sc h oo l d i s t r i c t s . Discussion Rule 340.1812, s u b r u l e (2), 1s d e s i g n e d t o e n s u r e t h a t t h e same l e v e l o f s p e c i a l e d u c a t i o n m l l l a g e fund s u p p o r t 1s p r o v i d e d f o r a l l s p e c i a l e d u c a t i o n pro gr ams and s e r v i c e s w i t h i n a g i v e n ISD. The same l e v e l o f s u p p o r t 1s r e q u i r e d f o r s p e c i a l e d u c a t i o n pr og ram s and s e r v ­ ices, r e g a r d l e s s o f w h e t h e r t h e s e prog ram s a r e o p e r a t e d by t h e ISD o r a c o n s t i t u e n t s ch oo l d i s t r i c t . T h i s r u l e does n o t a l l o w an ISD t o p r o v i d e s e r v i c e s on b e h a l f o f some c o n s t i t u e n t school d i s t r i c t s f r e e o f c h a r g e and t h e n t o p r o r a t e s u p p o r t t o o t h e r c o n s t i t u e n t d i s t r i c t s f o r o p e r a t i n g t h e same t y p e s o f s e r v i c e s . Such a p r a c t i c e 1s a m a j o r v io la tio n of th e equity p rinciple. As shown In T a b l e 5 and r e p o r t e d 1n t h e f i n d i n g s f o r R es ear ch Question 1, S u b s i d i a r y Q u e s t i o n l g , o f t h e 21 ISDs 1n which some t y p e s o f s p e c i a l e d u c a t i o n pro gr ams and s e r v i c e s w er e o p e r a t e d by b ot h t h e ISD and a t l e a s t one o f I t s c o n s t i t u e n t s ch o ol d i s t r i c t s , t e n w e r e n o t f o l l o w i n g t h e r e q u i r e m e n t s o f Rule 340.1812, s u b r u l e (2). These t e n ISDs w ere p r o v i d i n g f r e e s p e c i a l e d u c a t i o n s e r v i c e s f o r some c o n s t i t u ­ e n t school d i s t r i c t s and p r o r a t i n g payments f o r t h e same t y p e s o f s e r v i c e s o p e r a t e d by o t h e r c o n s t i t u e n t scho ol d i s t r i c t s . 148 Conclusion 3 Some ISDs have been I n a p p r o p r i a t e l y u s i n g e a r m a r k e d s p e c i a l edu­ c a t i o n m l l l a g e fu n ds t o s u p p l e m e n t t h e g e n e r a l e d u c a t i o n programs o f t h e i r o u t - o f - f o r m u l a c o n s t i t u e n t sch ool d i s t r i c t s . Discussion Michigan S p e c i a l E d u c a t i o n Rul e 3 4 0 . 1 8 1 1 , s u b r u l e ( 1 ) , r e q u i r e s t h a t s p e c i a l e d u c a t i o n m l l l a g e fu n d s be used s o l e l y t o s u p p o r t s p e c i a l e d u c a t i o n prog ram s and s e r v i c e s . As r e p o r t e d 1n t h e a d d i t i o n a l f i n d ­ i n g s f o r R es ear ch Q u e s t i o n 1, a t l e a s t f o u r ISDs were u s i n g s p e c i a l e d u c a t i o n m l l l a g e funds t o pay a l l o r p a r t o f w ha t t h e s t a t e r e c a p t u r e d from t h e g e n e r a l fund r e v e n u e s o f t h e i r o u t - o f - f o r m u l a c o n s t i t u e n t school d i s t r i c t s . In s h o r t , t h i s p r a c t i c e Involved using earmarked s p e c ia l education m llla g e funds t o supp o rt th e general education pro­ grams o f o u t - o f - f o r m u l a s ch oo l d i s t r i c t s , which t h e s t a t e had a l r e a d y d e t e r m i n e d t o be r e c e i v i n g e x c e s s i v e r e v e n u e s . Th is p r a c t i c e 1s u n q u e s t i o n a b l y an I n a p p r o p r i a t e us e o f s p e c i a l e d u c a t i o n f u nd s , which r e s u l t s 1n m a j o r r e d u c t i o n s o f e q u i t y and a l s o v i o l a t e s t h e b a s i c p r i n c i p l e s o f t h e s t a t e s y st e m f o r s u p p o r t o f p u b l i c e d u c a t i o n . Conclusion 4 Few ISDs a r e making a s e r i o u s e f f o r t t o comply w i t h t h e Michigan Rules g o v e r n i n g t h e d i s t r i b u t i o n o f s p e c i a l e d u c a t i o n m l l l a g e fu nd s b e c a u s e t h e r e has been no a p p a r e n t s y st e m f o r m o n i t o r i n g c o m p l i a n c e w i t h t h e s e Rules. D l 5.C..U5Sl p n Michigan S p e c i a l E d u c a t i o n R u l e s 340.1811 and 340.1812 were d e s i g n e d t o govern t h e e q u i t a b l e d i s t r i b u t i o n of s p e c i a l e d u c a t i o n 149 m l l l a g e fun ds. As p r e s e n t e d 1n t h e summary d i s c u s s i o n f o r Resea rc h Q u e s ti o n 1 and a s shown 1n T a b l e 5 , of t h e 42 ISDs s t u d i e d t h a t w ere r e q u i r e d t o f o l l o w R u le 340.1811, s u b r u l e s (2) , (3), and (4), or s u b r u l e (7)# a n d / o r Rul e 340.1812, o n l y n i n e were co m ply ing w i t h t h e provisions. I t 1s u n l i k e l y t h a t such g r e a t d i s c r e p a n c y 1n comp lyi ng with th e re q u ire d r u l e s governing t h e d i s t r i b u t i o n of specia l education m l l l a g e fu nd s would hav e o c c u r r e d 1f ISDs were making a g e n u i n e e f f o r t t o follow th e p ro v isions. As r e p o r t e d 1n t h e f i n d i n g s f o r R es ear ch Q u e s t i o n 4 , S u b s i d i a r y Q u e s t i o n 4b, t h e Michi gan D e p a r tm e n t o f E d u c a ti o n ha s n o t been m o n i t o r ­ ing t h e a p p l i c a t i o n o f t h e Michi gan S p e c i a l E d u c a t i o n R ules g o v e r n in g d i s t r i b u t i o n and use o f ISD s p e c i a l e d u c a t i o n m l l l a g e funds. A desig­ nee f o r t h e D e p a r tm e n t r e p o r t e d t h a t r e s p o n s i b i l i t y f o r m o n i t o r i n g t h e a p p l i c a t i o n o f t h e s e r u l e s r e s t s w i t h t h e ISDs and t h e i r s u p e r i n t e n d ­ e n t s as t h e c h i e f e x e c u t i v e o f f i c e r s . As n o te d 1n t h e d i s c u s s i o n o f t h e f i n d i n g s , t h e S t a t e D e p a r t m e n t o f E d u c a ti o n h a s e l e c t e d t o m o n i t o r o t h e r a r e a s 1n w h ic h , u s i n g t h e same p a t t e r n o f l o g i c p r e s e n t e d by t h e i r d e s i g n e e , t h e r e s p o n s i b i l i t y r e s t s w i t h ISDs and t h e i r c h i e f executive o ffic e rs. T h e r e f o r e , t h e r e a s o n g iv e n f o r n o t m o n i t o r i n g t h e a p p l i c a t i o n o f t h e s e R u l e s a p p e a r s t o be I n c o n s i s t e n t w i t h t h e r e a s o n s for monitoring o th e r areas. No a p p a r e n t s y s t e m e x i s t s t o m o n i t o r c o m p l i a n c e w i t h t h e s t a t e Rules g o v e r n i n g t h e e q u i t a b l e d i s t r i b u t i o n and use o f s p e c i a l e d u c a t i o n m l l l a g e funds. D i s t r i c t s do n o t seem t o be making a s e r i o u s e f f o r t t o 150 comply w i t h t h e r e q u i r e d p r o v i s i o n s , no r do es 1 t a p p e a r t h e y have been c h a l l e n g e d t o comply. CpJClusiPH-5 The f l a t - g r a n t s y s t e m , p r o p o r t i o n a t e g e n e r a l membership s y s t e m , and w e i g h t e d program c o s t s ys te m a r e a l t e r n a t i v e methods used by some ISDs t o d i s t r i b u t e s p e c i a l e d u c a t i o n m l l l a g e fun ds. These d i s t r i b u t i o n methods r e s u l t 1n v a r y i n g d e g r e e s o f r e i m b u r s e m e n t I n e q u i t y among c o n s t i t u e n t sc h oo l d i s t r i c t s . Discussion As p r e s e n t e d 1n t h e f i n d i n g s f o r R es ear ch Q u e s t i o n 2, S u b s i d i a r y Q u e s t i o n 2b, and r e p o r t e d 1n T a b l e s 12, 13, and 14, t h e f l a t - g r a n t d i s t r i b u t i o n s y s t e m , t h e p r o p o r t i o n a t e g e n e r a l membership d i s t r i b u t i o n s y s t e m , and t h e w e ig h t e d program c o s t d i s t r i b u t i o n s y s t e m a r e a l t e r n a ­ t i v e methods t h a t can r e s u l t 1n c o n s i d e r a b l e r ei m bu r se m en t I n e q u i t y among c o n s t i t u e n t sc ho ol d i s t r i c t s . As r e p o r t e d , se ve n d i s t r i c t s used a f l a t - g r a n t s y s t e m , one used a p r o p o r t i o n a t e g e n e r a l membership s y s ­ tem , and one used a w e i g h t e d program c o s t s y s t e m f o r d i s t r i b u t i n g s p e c i a l e d u c a t i o n m l l l a g e fu n ds t o c o n s t i t u e n t school d i s t r i c t s . With t h e amount o f I n e q u i t y I n v o l v e d 1n t h e s e p r a c t i c e s f o r d i s t r i b u t i n g s p e c i a l e d u c a t i o n m l l l a g e f u n d s , t h e i r c o n t i n u e d use would be d i f f i c u l t to ju stify 1f f i n a n c i a l e q u i t y 1s a g o a l . Conclusion 6 The a l t e r n a t i v e me thods used by ISDs 1n which t h e p r a c t i c e s d i f ­ f e r e d from t h e s t a t e - s p e c i f i e d d i s t r i b u t i o n sy st em 1n d e t e r m i n i n g a l l o w a b l e c o s t s , c a l c u l a t i n g r e c e i p t s , a n d / o r t h e manner o f pay­ ment r e s u l t 1n v a r y i n g d e g r e e s o f r e i m b u r s e m e n t e q u i t y among c o n s t i t u e n t sc ho ol d i s t r i c t s . 151 Discussion As p r e s e n t e d 1n t h e f i n d i n g s f o r Resea rc h Q u e s t i o n 2 , S u b s i d i a r y Q u e s t i o n 2b, and shown 1n T a b l e 9 , 2 4 ISDs used methods t h a t w ere v a r i a t i o n s o f t h e s t a t e - s p e d f l e d e x c e s s - c o s t d i s t r i b u t i o n syst em. These methods d i f f e r e d from t h e s t a t e me thods In t h e p r a c t i c e s used in d e t e r m i n i n g a l l o w a b l e c o s t s , c a l c u l a t i n g r e c e i p t s , a n d / o r t h e manner of payment. D i s t r i b u t i o n o f f u n d s among c o n s t i t u e n t sch ool d i s t r i c t s un der t h e v a r i o u s p r a c t i c e s r e s u l t e d 1n v a r y i n g d e g r e e s o f e q u i t y . Some o f t h e v a r i a n t p r a c t i c e s had l i t t l e o r no e f f e c t on t h e e q u i t a b l e d i s t r i b u t i o n o f s p e c i a l e d u c a t i o n m l l l a g e funds. With a number o f t h e s e p r a c t i c e s , e q u i t y was n o t s i g n i f i c a n t l y reduced. However, o t h e r p r a c t i c e s r e s u l t e d 1n g r e a t e r I n e q u i t y 1n t h e d i s t r i b u t i o n o f funds. On t h e b a s i s o f e q u i t y , 1 t would be d i f f i c u l t t o j u s t i f y t h e c o n t i n u e d use o f t h e f o l l o w i n g p r a c t i c e s t h a t d i f f e r e d from t h e s t a t e methods 1n: 1. D e te r m in in g a l l o w a b l e c o s t s . The p r a c t i c e of I n c l u d i n g an a d d i t i o n a l amount t o s u p p o r t g e n e r a l e d u c a t i o n a d m i n i s t r a t i o n . 2. C alculating re c e ip ts . The p r a c t i c e s o f n o t s u b t r a c t i n g membership r e c e i p t s , u s i n g a minimum g r o s s membership a l l o w a n c e , making a l a r g e r membership s u b t r a c t i o n f o r n o n r e s i d e n t s t u d e n t s s e r v e d 1n c e n t e r pr og ram s, and n o t s u b t r a c t i n g c a t e g o r i c a l a i d r e c e i p t s f o r c e n t e r programs. 3. The manner o f p a y m e n t: The p r a c t i c e s o f u s i n g a p r i o r i t y payment s y s t e m and pay in g a H k e - p e r c e n t f o r s e l e c t e d pr ograms. All p r o­ grams and s e r v i c e s r e q u i r e d un de r law and needed by a g i v e n h a n d i ­ capped s t u d e n t s h o u ld r e c e i v e an equa l l e v e l of fin a n c ia l support. 152 Co n cl u si o n 7 A l t e r n a t i v e me th od s f o r d i s t r i b u t i n g s p e c i a l e d u c a t i o n m l l l a g e f u n d s t h a t w e r e s u b m i t t e d f o r app ro val In an ISD s p e c i a l e d u c a t i o n p la n a p p e a r t o have been g r a n t e d Michigan Board o f E d uc a ti o n ap p r o v a l by d e f a u l t b e c a u s e t h e Michigan D e p a r tm e n t of E du ca tio n a p p a r e n t l y d i d n o t r e v i e w t h e s e a l t e r n a t i v e methods. Discussion As r e p o r t e d 1n t h e f i n d i n g s f o r Res earch Q u e s t i o n 4 , S u b s i d i a r y Q u e s t i o n 4a» t h e S t a t e D e p a r tm e n t o f E d u c a ti o n d id n o t have w r i t t e n c r i t e r i a o r p r o c e d u r e s t o ap p r o v e o r d i s a p p r o v e an a l t e r n a t i v e s p e c i a l e d u c a t i o n m l l l a g e d i s t r i b u t i o n method s u b m i t t e d f o r ap pro val 1n an ISD s p e c i a l e d u c a t i o n p la n. The Michi gan D ep ar tm en t o f Ed uc a tio n a n n u a l l y p r e s e n t s each ISO's s p e c i a l e d u c a t i o n p la n t o t h e S t a t e Board o f Educa­ t i o n fo r approval. As a l l 1984-85 s p e c i a l e d u c a t i o n p l a n s had been ap pr ov ed by t h e S t a t e Board o f Education# any a l t e r n a t i v e method f o r d i s t r i b u t i n g s p e c i a l e d u c a t i o n m l l l a g e fun ds I n c l u d e d 1n a p la n a p p e a r s t o have been ap pr ov ed a u t o m a t i c a l l y bec a u se no s t a f f re v ie w o f t h e a l t e r n a t i v e method was a p p a r e n t . I t 1s p o s s i b l e t h a t t h e S t a t e D e p a r tm e n t o f E d uc a ti o n did n o t have p r o c e d u r e s t o ap p r o v e o r d i s a p p r o v e an a l t e r n a t i v e method due t o an e r r o r o f o m i s s i o n when t h e r u l e s g o v e r n i n g t h e d i s t r i b u t i o n o f s p e c i a l e d u c a t i o n m l l l a g e f u n d s w e r e p r o m u l g a te d by t h e Michigan Board of E d u c a t i o n 1n 1980. As p r e s e n t e d a t t h e c o n c l u s i o n o f C ha pt er II» all b u t one o f t h e r e c o m m e n d a t io n s of t h e 1977 Task Force on S p e c i a l Educa­ t i o n f o r Rule ch an g e s c o n c e r n i n g t h e d i s t r i b u t i o n o f ISD s p e c i a l educa­ t i o n m l l l a g e f u n d s w ere Impl eme nt ed. T h i s r eco m me nda ti on was t o add a 153 s p e c i f i c p l a c e w i t h i n t h e r e q u i r e d com pon ent s o f an ISD s p e c i a l e d uc a­ t i o n p la n (Rule 340.1832) w her e a d e s i r e d a l t e r n a t i v e method and t h e r e a s o n s t h e r e f o r were t o be I n c lu d e d . The S t a t e D e p a r tm e n t o f Educa­ t i o n c a t e g o r i e s t h a t w ere used 1n r e v i e w i n g and e v a l u a t i n g ISD s p e c i a l e d u c a t i o n p l a n s (Appendix M) a r e based a l m o s t e n t i r e l y on t h e r e q u i r e d com ponents l i s t e d 1n Rule 340.1832. Therefore, not follow ing th e r ec om me nd at ion of t h e 1977 Task Fo rc e on S p e c i a l E d u c a ti o n t o add a s p e c i f i c p l a c e f o r t h e I n c l u s i o n o f an a l t e r n a t i v e d i s t r i b u t i o n method 1n an ISD s p e c i a l e d u c a t i o n p la n m i g h t h a v e l e d some ISDs t o o m i t an a l t e r n a t i v e method f o r d i s t r i b u t i n g s p e c i a l e d u c a t i o n m l l l a g e fu n ds from t h e i r s p e c i a l e d u c a t i o n p l a n s . I t m i g h t a l s o have l e d t h e S t a t e D e p a r tm e n t of E d u c a ti o n t o o m i t t h e r e v ie w and e v a l u a t i o n o f any a l t e r ­ n a t i v e s p e c i a l e d u c a t i o n m l l l a g e d i s t r i b u t i o n s y s t e m s t h a t were s u b m i t ­ t e d f o r ap pro val w i t h i n a s p e c i a l e d u c a t i o n plan. Conclusion 8 I f e q u i t y 1n t h e d i s t r i b u t i o n o f s p e c i a l e d u c a t i o n m l l l a g e fu nd s 1s t o become a r e a l i t y , s t a t e w i d e m o n i t o r i n g and e n f o r c e m e n t a c t i v i ­ t i e s w i l l have t o be e s t a b l i s h e d t o uphold t h e p r i n c i p l e s o f e q u i ­ t a b l e d i s t r i b u t i o n o f f u n d s a s embodied w i t h i n t h e Rule s. Discussion In t h e p a s t , when ISDs w ere l e f t t o m o n i t o r t h e i r own p r a c t i c e s 1n d i s t r i b u t i n g s p e c i a l e d u c a t i o n m l l l a g e fu nd s ( s e e d i s c u s s i o n 1n Chap­ t e r I c o n c e r n i n g t h e e v e n t s l e a d i n g t o t h e problem w i t h d i s t r i b u t i n g s p e c i a l e d u c a t i o n m l l l a g e f u n d s ) , many v a r i a n t d i s t r i b u t i o n p r a c t i c e s resulted. T h r ee r e a s o n s a r e o f f e r e d h e r e a s t o why ISDs. when l e f t on 154 t h e i r own* may a d o p t me th o ds t h a t r e s u l t 1n t h e I n e q u i t a b l e d i s t r i b u ­ t i o n o f s p e c i a l e d u c a t i o n m l l l a g e funds. F i r s t * t h e e f f e c t s o f ch ang es In one o r more a s p e c t s o f t h e complex s y st e m o f s p e c i a l e d u c a t i o n f u n d i n g a r e c o n c e p t u a l l y d i f f i c u l t t o u nde rs tan d* and w h a t a p p e a r s on t h e s u r f a c e t o be an e q u i t a b l e method may* 1n f a c t * n o t r e s u l t 1n equity. Second* c e r t a i n p r a c t i c e s a r e s o m e t im e s ado p te d f o r a d m i n i s ­ t r a t i v e ease. Third* t h e v a r i a n t p r a c t i c e s hav e evo lv ed o v e r a c o n s i d ­ e r a b l e p e r i o d o f t i m e ; t h e s e methods may have become a c c e p t e d p r a c t i c e s t h a t a r e r e s i s t a n t t o change. U n f o r t u n a t e l y , t h e c o m p l e x i t y o f t h e t o t a l s p e c i a l e d u c a t i o n fu nd ­ in g and o p e r a t i o n a l s ys te m p r e d i s p o s e s t o w a r d m i s u n d e r s t a n d i n g and a strong d e s ire for s im p lific a tio n . Most s p e c i a l e d u c a t i o n f u n d i n g 1s p r o v i d e d th r o u g h g e n e r a l memb ersh ip s u p p o r t , s p e c i a l e d u c a t i o n c a t e ­ g o r i c a l aid* and ISD s p e c i a l e d u c a t i o n t a x funds. Each o f t h e s e re v en u e s o u r c e s r e q u i r e s a c o n c e p t u a l u n d e r s t a n d i n g and s e v e r a l c a l c u l a t i o n s t h a t make e r r o r and m i s u n d e r s t a n d i n g l i k e l y . As a r e s u l t , many a d m i n i s t r a t i v e p e r s o n n e l may hav e p a r t i a l knowledge o f t h e s y st e m bu t c a n n o t r e a d i l y u n d e r s t a n d t h e e f f e c t o f v a r i a n t p r a c t i c e s on t h e p r i n c i p l e s of equity. Adoption o f v a r i a n t p r a c t i c e s f o r r e a s o n s o f a d m i n i s t r a t i v e e a s e may be a l o g i c a l r e s u l t o f t h e problem of c o m p l e x i t y d i s c u s s e d above. Even when t h e ISD s p e c i a l e d u c a t i o n a d m i n i s t r a t o r 1s f u l l y c o g n i z a n t of t h e s ys te m and I t s e f f e c t s , 1 t may o f t e n r e q u i r e an e x t e n s i v e e f f o r t t o h e l p c o n s t i t u e n t d i s t r i c t p e r s o n n e l a c h i e v e such u n d e r s t a n d i n g . The t e m p t a t i o n 1s o f t e n g r e a t t o s i m p l i f y t h e r e i m b u r s e m e n t s y st e m b e c a u s e 155 o f e a s e of c a l c u l a t i o n and e a s e of co m m u n ic a ti n g t h e sy ste m t o con­ stituents. The n a t u r e o f t h e p r o c e s s o f change I t s e l f 1s such t h a t w a l l s o f r e s i s t a n c e a r e a l m o s t a l w a y s In v ol v ed . In c a s e s where an a l t e r n a t i v e method o f d i s t r i b u t i n g s p e c i a l e d u c a t i o n m l l l a g e fund s 1s b ei ng used# which r e s u l t s 1n t h e I n e q u i t a b l e d i s t r i b u t i o n o f t h e s e fu nd s among constituent d istricts# t h e w a l l s o f r e s i s t a n c e m i g h t be p o l i t i c a l l y r e i n f o r c e d by t h o s e d i s t r i c t s b e n e f i t e d by t h e method. districts# b e c a u s e o f t h e i r s e l f - i n t e r e s t # c o u l d make 1 t p o l i t i c a l l y d i f f i c u l t t o a l t e r t h e sy st em . state# The a dv an ta ge d W i th o u t an o u t s i d e f o r c e such a s t h e t h e r e m i g h t be c o n s i d e r a b l e I n t e r n a l p o l i t i c a l r e s i s t a n c e from some c o n s t i t u e n t d i s t r i c t s # which c o u l d r e s t r i c t an ISO's a b i l i t y t o a l t e r by I t s e l f t h e c u r r e n t d i s t r i b u t i o n method. As r e p o r t e d 1n t h e f i n d i n g s f o r R e s ea rc h Q u e s t i o n 4# S u b s i d i a r y Q u e s t i o n 4b» ISDs hav e been r e s p o n s i b l e p r i m a r i l y t o t h e m s e l v e s f o r m o n i t o r i n g t h e a p p l i c a t i o n o f r u l e s g o v e r n i n g t h e d i s t r i b u t i o n of s p e c i a l e d u c a t i o n m l l l a g e fu n ds b ec a u se t h e S t a t e D ep ar tm en t has n o t been m o n i t o r i n g such a p p l i c a t i o n . As 1n t h e past# and a c c o r d i n g t o t h e f i n d i n g s o f t h i s study# t h e s t a t e p r a c t i c e of a l l o w i n g ISDs t o m o n i t o r t h e m s e l v e s 1n d i s t r i b u t i n g s p e c i a l e d u c a t i o n m l l l a g e fu nds h a s n o t proven e f f e c t l v a I f t h e s t a t e ' s goal Is t o ensure th e e q u ita b le d i s t r i b u t i o n o f s p e c i a l e d u c a t i o n m l l l a g e f u n d s among and w i t h i n ISDs as r e q u i r e d by R u le s 340.1811 and 340.1812# s t a t e w i d e m o n i t o r i n g and e n f o r c e m e n t a c t i v i t i e s w i l l have t o be e s t a b l i s h e d . 156 Recommendations The f o l l o w i n g rec o m me nd at io ns a r e o f f e r e d * based on t h e f i n d i n g s and c o n c l u s i o n s o f t h i s s t u d y c o n c e r n i n g t h e e q u i t a b l e d i s t r i b u t i o n o f ISD s p e c i a l e d u c a t i o n m l l l a g e f u n d s t o c o n s t i t u e n t s ch o ol d i s t r i c t s 1n Michigan. 1. I t 1s recommended t h a t : The Michigan D e p a r tm e n t o f E d u c a t i o n a c c e p t r e s p o n s i b i l i t y f o r w o rki ng w i t h ISDs t o e n s u r e c o m p l i a n c e w i t h t h e Michi gan S p e c i a l E d u c a t i o n Ru le s g o v e r n i n g t h e e q u i t a b l e d i s t r i b u t i o n o f s p e c i a l e d u c a t i o n m l l l a g e f u n d s t h r o u g h f o rm al m o n i t o r i n g o f p r a c t i c e s and e n f o r c e m e n t o f e x i s t i n g r e g u l a t i o n s p e r t a i n i n g t o r e i m b u r s e m e n t of c o n s t i t u e n t d i s t r i c t pr ograms. 2. The Michigan D e p a r t m e n t o f E d u c a t i o n d e v e l o p w r i t t e n c r i t e r i a and p r o c e d u r e s f o r t h e a p p r o v a l o r d i s a p p r o v a l o f an a l t e r n a t i v e method f o r d i s t r i b u t i n g s p e c i a l e d u c a t i o n m l l l a g e fun ds and t h e r e a s o n s g i v e n f o r s o using* which have been s u b m i t t e d f o r ap p r o v al In a sp e c ia l education plan. I t 1s s u g g e s t e d t h a t * accompanying a d e s i r e d a l t e r n a t i v e method and t h e r e a s o n s f o r I t s use* an ISD a l s o be r e q u i r e d t o I n c l u d e , by each c o n s t i t u e n t d i s t r i c t * a 11st o f t h e e s t i m a t e d p e r c e n t a g e o f u n r e i m b u r s e d c o s t s t h a t would o c c u r un d er t h e a l t e r n a t i v e method* ba se d on t h e most r e c e n t c o s t d a t a available. 3. The Michigan D e p a r tm e n t of E d u c a t i o n I n d i c a t e a s p e c i f i c p l a c e where an a l t e r n a t i v e method and t h e r e a s o n s f o r I t s us e a r e t o be I n c l u d e d 1n an ISD's s p e c i a l e d u c a t i o n plan. 157 4. The p r a c t i c e by which ISDs have used ea r m ar k ed s p e c i a l e d u c a t i o n fun ds t o rep ay a l l o r p a r t o f what t h e s t a t e has r e c a p t u r e d from g e n e r a l fund r e v e n u e s o f t h e i r o u t - o f - f o r m u l a sch oo l d i s t r i c t s be f u l l y I n v e s t i g a t e d and c u r t a i l e d . The Michigan D e p a r tm e n t o f Edu­ c a t i o n s h o u l d c o n s i d e r r e q u i r i n g any o u t - o f - f o r m u l a d i s t r i c t t h a t r e c e i v e d e a rm a r k e d s p e c i a l e d u c a t i o n m l l l a g e fun ds a s r e p a y m e n t f o r w h a t t h e s t a t e r e c a p t u r e d from I t s g e n e r a l fund r e v e n u e s t o rep ay t h e c u m u l a t i v e amount of fun ds r ec e iv ed # plus a p p l ic a b l e I n t e r e s t . I t 1s f u r t h e r recommended t h a t t h e s t a t e l e g i s l a t u r e c o n s i d e r d i r e c t l y b i l l i n g o u t - o f - f o r m u l a school d i s t r i c t s f o r am ou nt s t o be recaptured. I t 1s d i f f i c u l t f o r d i s t r i c t s 1n which f u n d s a r e b ei n g r e c a p t u r e d t o view a r e d u c t i o n 1n c a t e g o r i c a l s u p p o r t a s o t h e r t h a n a r e d u c t i o n 1n c a t e g o r i c a l s u p p o r t . 5. The p r a c t i c e by which ISDs p r o v i d e s e r v i c e s t o some c o n s t i t u e n t s ch oo l d i s t r i c t s f r e e o f c h a r g e and p r o r a t e payments f o r t h e same t y p e s o f s e r v i c e s t o o t h e r c o n s t i t u e n t school d i s t r i c t s be sto pp ed . I t 1s s u g g e s t e d t h a t ISDs (and l o c a l sch oo l d i s t r i c t s ) be s e n t a c o m m u n i c a t i o n e x p l a i n i n g t h e p r o v i s i o n s o f Rule 340.1812 and I n f o r m i n g them o f t h e I n t e n t i o n t o m o n i t o r c o m p l i a n c e w i t h t h i s r u l e 1n t h e f u t u r e . Recommendations f o r F u t u r e Resea rc h T h i s s t u d y a d d r e s s e d e q u i t y 1n t h e d i s t r i b u t i o n o f s p e c i a l e du ca ­ t i o n m l l l a g e fu nds based on s t a t e and l o c a l s u p p o r t r e c e i v e d f o r t h e y e a r l y o p e r a t i o n a l e x p e n s e s of s p e c i a l e d u c a t i o n pr o gr am s and s e r v i c e s . S e v e r a l o t h e r f a c t o r s t h a t a r e l i k e l y t o a f f e c t e q u i t y 1n t h e 158 d i s t r i b u t i o n of s p e c i a l e d u c a t i o n m l l l a g e f u n d s w e r e n o t s t u d i e d . These f a c t o r s a r e : 1. Federal funds. U nl es s an a l t e r n a t i v e method ha s been I n c l u d e d and ap pr ove d 1n an ISD s p e c i a l e d u c a t i o n p l a n , (3), R ul e 340.1811, subrule r e q u i r e s t h a t f e d e r a l funds r e c e i v e d by c o n s t i t u e n t d i s t r i c t s be I n c l u d e d a s a r e c e i p t 1n c a l c u l a t i n g t h e i r u n r e i m b u r s e d c o s t s . I t 1s n o t known 1f t h i s r e q u i r e m e n t 1s f o l l o w e d c o n s i s t e n t l y . The I n t e r a c t i o n o f f e d e r a l fu nd s w i t h s t a t e and l o c a l s u p p o r t f u n d s r e c e i v e d a s t h e s e a f f e c t e q u i t y 1n t h e d i s t r i b u t i o n o f ISD s p e c i a l e d u c a t i o n m l l l a g e f u n d s 1s b e l i e v e d t o be w o r th y o f s tu d y . 2. B U l b a c k and t u i t i o n payment s y s t e m s . For v a r i o u s r e a s o n s , many ISDs have d e v i s e d s y s t e m s of b i l l backs a n d / o r t u i t i o n c h a r g e s f o r s p e c i a l e d u c a t i o n pr ograms and s e r v i c e s o p e r a t e d by t h e ISD a n d / o r c o n s t i t u e n t s ch oo l d i s t r i c t s . No s p e c i a l e d u c a t i o n r u l e s e x i s t t o . p r o t e c t e q u i t y und er t h e s e p r a c t i c e s . For ex a m p le , s e v e r a l ISDs do n o t r e i m b u r s e c o n s t i t u e n t school d i s t r i c t s b e c a u s e t h e i r s p e c i a l e d u c a t i o n m l l l a g e fun ds a r e I n s u f f i c i e n t t o s u p p o r t t h e f u l l u n r e i m b u r s e d c o s t s of programs and s e r v i c e s o p e r a t e d on b e h a l f o f t h e i r c o n s t i t u e n t school d i s t r i c t s . These ISDs hav e d e v i s e d b i l l - back s y s t e m s t o c h a r g e c o n s t i t u e n t sc h oo l d i s t r i c t s f o r t h e i r remaining unreimbursed costs. Many ISDs have a l s o d e s i g n e d t u i t i o n payment s y s t e m s t o s u p p o r t a l l o r p a r t o f t h e u n r e i m b u r s e d c o s t s f o r s t u d e n t s s e r v e d 1n pr ograms o p e r a t e d by d i s t r i c t s o t h e r t h a n th e ir resident d is tr ic t. The e f f e c t o f t h e v a r i o u s b i l l back and t u i t i o n payment s y s t e m s f o r t h e s u p p o r t o f s p e c i a l e d u c a t i o n 159 p ro g ram s and s e r v i c e s a s t h e s e I n f l u e n c e e q u i t y 1n t h e d i s t r i b u t i o n o f s p e c i a l e d u c a t i o n m l l l a g e f u n d s 1s unknown. 3. Special education tr a n s p o r t a t i o n . U n le s s an a l t e r n a t i v e t r a n s p o r ­ t a t i o n f u n d i n g method has been s u b m i t t e d and ap pr o ve d 1n an ISD special education plan, Rule 340.1811, s u b r u l e s (2), (3), and (4), g o v e r n s t h e use o f s p e c i a l e d u c a t i o n m l l l a g e f u n d s f o r t h e r e i m ­ bursement of sp e cia l education t r a n s p o r t a t i o n . I t 1s n o t known 1f t h i s Rule 1s b e i n g f o l l o w e d o r how e q u i t y 1n t h e d i s t r i b u t i o n of s p e c i a l e d u c a t i o n m l l l a g e funds m i g h t be a f f e c t e d by t h e use o f any v ariant practices. 4, Other uses of s p e c ia l education m l lla g e funds. To v a r y i n g d e g r e e s , ISDs u s e s p e c i a l e d u c a t i o n m l l l a g e f u n d s f o r p u r p o s e s o t h e r t h a n t o s u p p o r t t h e u n r e i m b u r s e d c o s t s I n v o l v e d 1n p r o v i d i n g s p e c i a l educa­ t i o n pro gr ams and s e r v i c e s . Most d i s t r i c t s use o r have used s p e ­ c i a l e d u c a t i o n m l l l a g e fun ds f o r b u i l d i n g s and o t h e r c a p i t a l - o u t l a y expenditures. What o t h e r u s e s a r e made o f s p e c i a l e d u c a t i o n f u n d s and how e q u i t y m i g h t be a f f e c t e d a r e unanswered q u e s t i o n s . APPENDICES APPENDIX A MICHIGAN PUBLIC ACT 18 OF 195** 161 162 PUBLIC AND LOCAL ACTS 01*' THE LEGISLATURE OK T H E State of Michigan PASSED A T T H E REGULAR SESSION OE 1954 C O N T A IN IN G JO IN T RESO LU TIO N S, A M E N D M E N T S TO C O N ST IT U T IO N AND AHSTKACTS OK PR O C E E D IN G S R E L A T IV E TO CH A N G E OK BO U N DA RIES OK TO W N ­ S H IP S A N D IN C O R PO R A T IO N , ETC., OK C IT IE S AND VJLLACES. "I COM 1*11.1:1) UY OW EN J. CLEARY SBCIIUTAIIY OP STATU* .IN B K H IIIN I COMPANY. VTAYC P A I N T l P f . IM A LAN9INO. MICHIOAN 163 24 P U B L IC A CTS 1954 No. 18. If any person liable for a tax levied hereunder shall sell out his business or stock of goods, or shall cease his business activity, such person shall make a return within 15 days thereafter covering any period for which no return has been filed, and shall remit the am ount of tax, interest and penalties shown to be due. T he departm ent, upon application of the taxpayer and for good cause shown, may extend the tim e for making any return required by this act. Interest a t the rate of 6% per annum shall accrue during the period of any such exten­ sion. 205.562 S a m e ; n o tic e t o ta x p a y e r ; h e a r in g , a p p e a l, in ju n c tio n . [M .S .A . 7 .5 5 7 (1 2 )] Sec. 12. In carrying out the provisions of section 10 of this act, the departm ent shall, after determining the am ount of tax due from any taxpayer, give notice to such taxpayer of its intent to levy such tax. Such taxpayer may, if he so desires and serves notice thereof upon the departm ent within 20 days, demand a hearing on the question of his liability for such assessment. Thereupon the departm ent shall set a time and place for hearing and shall give the taxpayer reasonable notice thereof. The taxpayer shall be entitled to appear before the departm ent and be represented by counsel and present testimony and argument. A fter the hearing the departm ent shall render its decision in writing and, by order, levy any tax, interest and penalty found by it to be due and payable. Any taxpayer aggrieved by any determination of tax liability made by the departm ent may appeal to the state hpard of tax appeals from such determination under the provisions of Act No. 122 of the Public Acts of 1941, as amended, being sections 205.1 to 205.17, in­ clusive, of the Compiled Laws of 1948, or he shall be required to pay the am ount of tax found to be due by the departm ent and shall be perm itted to bring an action in the circuit court in any county in which he transacts business, to recover the am ount of tax alleged to have been unlawfully required of such person. Such action m ust be commenced within 6 m onths afte r paym ent of such tax or after the adverse determination by the departm ent of the validity of the taxpayer’s claim for refund under section 7 of this act, whichever occurs later, and shall be conducted in accordance with the statutes and rules of procedure concerning actions a t law not inconsistent with the provisions of this act. No injunction shall issue to stay proceedings for the assessment and collection of any tax levied under this act. 205.567 S a m e ; ta x to b e a d d itio n a l. [M .S .A . 7 .5 5 7 (1 7 )] Sec. 17. T he specific tax imposed by this act shall be in addition to all other for which the taxpayer may be liable. S e c tio n r e p e a le d . Section 2. Section 14 of Act No. 150 of the Public Acts of of the Compiled Laws of 1948, is hereby repealed. This act is ordered to take immediate effect. Approved M arch 12, 1954. taxes 1953,being section 205.564 [N o . 18.] AN ACT to provide for the financing, adm inistration and operation of special education programs for handicapped children by school districts, including county school districts; to provide for the granting of financial assistance by county school districts to constituent school districts for special education housing or program s; to provide for county school dis­ tricts and constituent districts to bind themselves together by contract for long-term co­ operation in special education enterprise; and to provide for the allocation, levying, col­ lection and handling of a county school tax for special education. PU BLIC ACTS 1954—No. 18. 25 The People o f the State o f Michigan enact: 393.401 Definitions. [M .S.A. 15.2161] Sec. 1. T he following words and phrases as used in this chapter, unless a different mean­ ing is plainly required by the content, shall have the following meanings: (a) “County school district” shall mean that corporate body established by Act No. 117 of the Public Acts of 1935, as amended, being sections 388.171 to 388.187, inclusive, of the Compiled Laws of 1948. fb ) “Constituent school districts” shall be those school districts the main school house of which is situated within the geographic limits of the county to which the district is con­ stituent. (c) “ Special education” shall mean education of a type designed especially for deaf, hard of hearing, blind, partially seeing, speech defective, home-bound, mentally handicapped, crippled or otherwise physically handicapped, or children having behavior problems, as all of such handicaps are defined by the superintendent of public instruction. (d ) “Special education center” shall mean a constituent school district which, by action of its board of education, contracts with the county board of education to provide special education to non-resident pupils. (e) “Special education facility” shall mean any program of special education instruc­ tion, as defined in (c) above, which is approved by the superintendent of public instruction. (f) “Special education buildings an d /o r equipment” shall mean any school housing and/or equipment acquired or prepared for, or used in, operating a special education facility approved by the superintendent of public instruction. (g) “Special education supplies” shall mean any consumable school supplies employed in special education. 393.402 R eferendum . [M .S.A. 15.2162] Sec. 2. This act shall become effective whenever a m ajority o f the school electors of a county school district, in a county of 390,000 population or over as determined according to the latest or each succeeding federal decennial census, present and voting, in any one year at the several annual school elections in the constituent school districts, shall vote to come under its provisions: Provided, T hat the effect of the provisions of this act may be amended or removed from a county school district by the same process. 393.403 Sam e; election; ballots, notice. [M.S.A. 15.2163] Sec. 3. W henever the county board of education shall direct th at the question of coming under the provisions of this act shall be submitted to the school electors of a county school district, the secretary of the county board of education shall cause to have printed and distributed sufficient ballots so th a t the school electors of each constituent school district may vote on the question a t its next annual school election, and shall give notice to con­ stituent school districts at least 60 days in advance of said annual school election th at the question of coming under the provisions of this act shall be submitted to the electors of the district: Provided, T hat the county board of education shall employ the form of ballot so prescribed herein for this type of election and that said board shall, by resolution, determine a millage limit on taxation to be submitted to the electors at the next annual meeting, and the secretary or director of the board of education of each constituent district shall cause proper notice to be given to the electors in the district of the question to be submitted, such notice to be given at the same tim e and in the same manner as that provided in the school code for notice of annual school elections for the district. 393.404 S a m e ; c o n d u c t, c a n v a s s, r e p o r t. [M .S .A . 15.2164] See. 4.The board of education in the constituent school districts of a county as defined in section 1 (b) shall conduct the balloting on the question of coming under the provisions of this act, and said board shall canvass the vote as taken and report the results of such can­ vass to the secretary of the county board of education by registered mail within 10 days of such election. 165 26 PUBLIC ACTS 1954—No. 18. 393.405 Sam e; canvass, report. [M.S.A. 15.2165] Sec. 5. N ot more than 45 days after the holding of such election, the county board of education shall meet and canvass the election reports of the constitulenl districts. T he findings of the county board shall be made a m atter of record in its minutes and shall be distributed by the secretary to the boards of education of the constituent districts, and to the superintendent of public instruction. 393.406 S p e c ia l e d u c a tio n b u d g e t ; d e liv e r y to c o u n ty c le rk . [M .S .A . 15.2166] Sec. 6. Each county board of education of a county school district coming under the provisions of this act shall cause to have prepared annually a special education budget, which shall be in the same form as th at provided for other school districts, such budget to be delivered to the county clerk of the county in which the district is located and the county clerks of other counties, if the county school district is fractional between counties. Each county clerk receiving such budget shall deliver it into the hands of the tax allocation board in the same m anner as other school district budgets are handled. 393.407 T a x r a t e s ; a llo c a tio n ; lim ita tio n . [M .S .A . 15.2167] Sec. 7. County tax allocation boards shall receive special education budgets from their respective county clerks; shall treat them as other school district budgets are treated and shall allocate tax rates to county school districts for the purposes set forth in this act, such allocations to be handled in the same manner as other allocations for school districts; P ro­ vided, T h at such allocations shall not be made within the 15 mill limitation and may not exceed the limit authorized by the election at which this act is placed in effect. 393.408 C ertification by board of education. [M.S.A. 15.2168] Sec. 8. When the county board of education shall have received an allocation on the basis of its special education budget, it shall certify for collection to the several municipal and township officials concerned, a statem ent of the am ount of taxes to be levied, such certification to be made at the same tim e and in the same m anner as that of other school districts: Provided, T hat the rate certified for levy shall n ot exceed the am ount allocated. 393.409 Special education tax ; collection. [M .S.A. 15.2169] Sec. 9. On receipt of such statem ent from the county board of education, the munic­ ipal and township officials responsible for the levying and collection of taxes shall cause to have spread on the tax roll a special education tax equal to the am ount ordered spread, and shall collect such taxes in the same manner as other taxes are collected. 393.410 P aym ent to county tre a su re r; accounts and records; fractional districts. [M .S.A. 15.2170] Sec. 10. Taxes collected under the provisions of this act shall be paid over to the county treasurer in the same manner as other county taxes are paid over, and similar accounts and records shall be kept; Provided, T h at the county treasurer shall credit all funds received under this act to the account of the county board of education. County treasurers of coun­ ties in which fractions of the county school districts operating under this act are situated shall pay over those funds collected under the act to the county treasurer of the county in which said county school district is situated. 393.411 B a llo ts; form. [M .S.A. 15.2171] Sec. 11. T he ballot to be used in referring the question of the adoption of this act to the school electors of a county school district shall be set forth in the following form : "Shall the county school district o f ....................................................................... county, state of Michigan, come under the provisions of the special education act, which statute is designed to encourage the education of the handicapped children: Provided, T hat any annual property lax levied for the adm inistration of this act shall be limited t o ............. mills? Yes n No Q " PUBLIC ACTS 1954—No. 18. 393.412 Special education program s; em ploy teachers. 27 [M .S.A. 15.2172] Sec. 12. County boards of education coming under the provisions of this act shall operate special education programs in those instances where such service is not available in special education centers. Such boards shall have the authority to employ teachers and other personnel, and to provide for their transportation, to purchase and m aintain special educa­ tion supplies and equipment, and to secure proper office space and supplies: Provided, T h at county boards are prohibited from appropriating funds to m aintain or construct buildings to house special education classes unless such buildings are owned by constituent school districts and are under the adm inistration o f the school board of a special education center; and are prohibited from expending special education funds for purposes other than those set forth in this act. 393.413 Children, m em bership. [M.S.A. 15.2173] Sec. 13. County boards of education maintaining special education programs m ay carry children in membership in the same manner as other school districts and shall be entitled to their proportionate share of any state funds available under the law in subsidy for such programs. 393.414 Subsidies; com putation; reim bursem ent. [M .S.A. 15.2174] Sec. 14. County boards of education operating under this act shall grant subsidies from special education funds to those constituent districts maintaining special education centers, such subsidies to be computed in the following m anner: T he per capita cost of each type of special education in each constituent facility shall be computed. From this am ount shall be deducted the current per capita state subsidy, including membership as well as special edu­ cation grants, for each respective type of special education. All or p art of the difference resulting, multiplied by the num ber of pupils educated, shall be reimbursable by the county board of education: Provided, T hat if the funds are not sufficient to m ake up all this differ­ ence, a like percent of such difference will be paid to all constituent centers in the county. 393.415 G rants. [M .S.A. 15.2175] Sec. 15. T he county board of education may make grants of moneys to constituent districts operating special education centers for the purpose of building special education buildings a n d /o r purchasing land or special education equipm ent: Provided, T h at prior to the granting of such funds the school board of the constituent district wherein the center is located shall have contracted to receive non-resident children into the facility for a period of a t least 15 years after the date of contract. 393.416 C ontracts w ith constituent d istricts. [M .S.A. 15.2176] Sec. 16. T he county board of education may enter into long-term contracts with con­ stituent districts; such contracts to provide that the constituent districts are bound to accept non-resident pupils into specified special education facilities in return for and in considera­ tion of grants in aid for the construction of special education buildings and the purchase of special education buildings and the purchase of special education equipment a n d /o r land. 393.417 Special education c e n te r; non-resident pupils. [M .S.A. 15.2177] Sec. 17. Any constituent district maintaining a special education facility approved by the superintendent of public instruction may enter into contracts w ith the county board of education and shall become a special education center by contracting with the county board of education to accept those non-resident pupils assigned into its facility by the county board of education. 393.418 Special education funds. [M.S.A. 15.2178] Sec. 18. Special education funds held by the county treasurer for the county board of education shall be paid out by him on order of said county board of education. 393.419 C om m ittee; appointm ent, duty. [M.S.A. 15.2179] Sec. 19. The county board of education shall, each year, appoint a com mittee of at least 5 persons, to consist of at least 2 school superintendents and 3 school board members of PUBLIC ACTS 1954—No. 19. 28 constituent districts, and it shall be the d uty of this committee, along with the superin­ tendent of public instruction, or his agent, to visit special education facilities in Lhe county and advise the county board of education relative to the adm inistration of this act. 393.420 S hort title. [M.S.A. 15.2180] Sec. 20. This act shall be known and may be cited as "T he special education act.” This act is ordered to take imm ediate effect. Approved M arch 19, 1954. [No. 19.] AN ACT to amend section 11 of chapter 6 of Act No. 175 of the Public Acts of 1927, entitled “An act to revise, consolidate and codify the laws relating to criminal procedure and to define the jurisdiction, powers, and duties of courts and of the judges and other officers thereof under the provisions of this act; to provide laws relative to the rights of persons accused of criminal offenses; to provide for the arrest of persons charged with or suspected of criminal offenses; to provide for bail of persons arrested for or accused of criminal offenses; to provide for the examination of such persons accused of criminal offenses; to regulate the procedure relative to grand juries, indictments, informations, and proceedings before trial; to provide for trials of persons complained of or indicted for criminal offenses and to provide for the procedure therein; to provide for judgments and sentences of persons convicted of criminal offenses; to provide for procedure relating to new trials, appeals, writs of error and bills of exception in criminal causes; to provide a uniform system of probation throughout the state of Michigan, the appointment of proba­ tion officers and to prescribe the powers, duties and compensation of such officers and to provide penalties for the violation of the duties of such officers; to provide for procedure governing proceedings to prevent crim e; proceedings for the discovery of crime; to provide for the jurisdiction, powers, duties, and procedure of justices of the peace in criminal cases; to provide for fees of officers, witnesses and others in criminal cases; miscellaneous provisions as to criminal procedure in certain cases; to provide penalties for the violation of certain provisions of this act and to repeal all acts and parts of acts inconsistent with or contravening any of the provisions of this act,” being section 766.11 of the Compiled Laws of 1948. The People o] the State o f Michigan enact: Section amended. Section 1. Section 11 of chapter 6 of Act No. 175 of the Public Acts of 1927, being section 766.11 of the Compiled Laws of 1948, is hereby amended to read as follows: C H A PT E R 6. 766.11 Subpoena of w itness; taking of evidence; procedure, stenographer’s oath, com pensation and fees. [M.S.A. 28.929] Sec. 11. W itnesses may be compelled to appear before such magistrate by subpoenas issued by him, or by any officer or court authorized to issue subpoenas, in the same manner and with the like effect and subject to the same penalties for disobedience, or for refusing to be sworn or to testify, as in cases of trials before justices of the peace; and the evi­ dence given by the witnesses examined shall be reduced to writing by such magistrate, or under his direction and shall be signed by the witnesses respectively: Provided, T hat unless otherwise provided by law, the evidence so given shall be taken down in shorthand by a county stenographer where one has been appointed under the provision of any local act of the legislature or by the board of supervisors of the county wherein such examination is held, or the m agistrate for cause shown may appoint some other suitable stenographer a t the request of the prosecuting attorney of said county with the consent of the re­ spondent or his attorney to act as official stenographer pro tern, for the court of such magis- APPENDIX B INTERMEDIATE SCHOOL DISTRICT SPECIAL EDUCATION MILLAGE RATES 168 169 I n t e r m e d i a t e School D i s t r i c t S p e c i a l E d u c a ti o n M l l l a g e R a t e s Ranked From H i g h e s t To Lowest L e v i e s - October* 1985 Rank D i s t r i c t Name Rank D i s t r i c t Name (32) (33) (34) Ottawa Kent Ion1 a 1.4000 1.3300 1.2883 (35) (36) Barry M e co s ta - O s ce o la 1.2500 1.2500 (37) (38) Montcalm A1legan 1.2295 1.2035 (39) (42) (43) (44) (45) (46) (47) (48) (49) (50) (51) Ch eboy ga n - O t s e g o Presque I s l e E a s t e r n U.P. C la r e - G l a d w ln D 1 ck 1n so n -Ir o n Gogeblc-Ontonagon T r a v e r s e Bay Copper Co un try Huron Lap eer Man1stee Ma rq uet te -A l g e r Wayne Wexford-M1 s s a u k e e (52) (53) (54) Oceana Menominee Sanilac .9520 .9456 .9000 (55) (56) Iosco C00R .7500 .7500 (57) Midland .0000 (l) (2) (3) (4) (5) (6) (7) (8) (9) (10) Jackson Ingham Lenawee Eaton S t . Joseph Muskegon Branch Van Buren Sh1awassee Washtenaw 4 .0 00 0 3 .7 50 0 3.5000 3.0000 2 .7 50 0 2.5000 2 .4 50 0 2.3800 2.3330 2. 200 0 (11) (12) (13) (14) (15) (16) (17) Calhoun H illsd ale Kalamazoo V a l l e y Macomb Monroe Newaygo Saginaw 2.0000 2. 00 00 2.0000 2. 0000 2.0000 2. 00 00 2.0000 (18) (19) (20) 1.7500 1.6000 (21) Oakland Tuscola A1pena-Montmorency-A lco na Ch a r l ev o1 x - Emmet (22) (23) (24) (25) (26) (27) (28) (29) (30) (31) Bay-Arenac Berrien Lewis Cass Cl 1nton Delta-School c r a f t Genesee G ratlo t-Isab el la Livingston Mason-Lake St. C la ir 1.5000 1.5000 1.5000 1.5000 1.5000 1.5000 1.5000 1.5000 1.5000 1.5000 Source: 1.5500 1.5400 m (41) Michigan D ep art m ent o f E d uc a ti o n Document ( 1 - 1 5 - 8 5 ) & Telephone Survey U K : 10-20-85 Levy Levy 1.0000 1.0000 1.0000 1.0000 1.0000 1.0000 1.0000 1.0000 1.0000 1.0000 1.0000 1.0000 1.0000 APPENDIX C SUMMARY TABLE OF LEGAL PROVISIONS CONCERNING THE ADOPTION AND THE DISTRIBUTION OF INTERMEDIATE SCHOOL DISTRICT SPECIAL EDUCAT ON MILLAGE 170 171 A CHRONOLOGICAL LISTING AND CONTENT SUMMARY OF MICHIGAN'S LEGAL PROVISIONS AFFECTING THE ADOPTION OF A SPECIAL EDUCATION MILLAGE LEVY AND THE DISTRIBUTION OF SUCH FUNDS TO CONSTITUENT SCHOOL DISTRICTS Year 1954 1955 C o n t e n t Summary o f t h e Legal P r o v i s i o n s Michigan P u b l i c Act 18 o f 1954 1. An o r i g i n a l Act* which was t i t l e d * ' T h e S p e c i a l E d u c a t i o n Act” ( S e c t i o n 20)* and c o n s i s t e d o f S e c t i o n s 1 t h r o u g h 20. 2. A u t h o r i z a t i o n was p r o v i d e d ( S e c t i o n 2) f o r v o t e r s o f cou n ty s ch oo l d i s t r i c t s t o t a x t h e m s e l v e s f o r t h e p u r p o s e o f su p­ p o r t i n g t h e c o s t s o f e d u c a t i n g h a n d ic ap pe d c h i l d r e n . The a u t h o r i z a t i o n t o a d o p t a s p e c i a l e d u c a t i o n m l l l a g e le v y was l i m i t e d t o c o u n t i e s w i t h a p o p u l a t i o n o f 390*000 o r more. 3. Only 1f a s p e c i a l e d u c a t i o n m l l l a g e t a x was ap pr ove d ( S e c t i o n 2) d i d t h e p r o v i s i o n s o f t h e Act ( S e c t i o n s 1-19) take e f f e c t. 4. To amend o r remove a s p e c i a l e d u c a t i o n m l l l a g e levy* once adopted* r e q u i r e d a n o t h e r v o t e o f t h e e l e c t o r s ( S e c t i o n 2). T h i s r e q u i r e m e n t had t h e e f f e c t o f making t h e s p e c i a l e d u c a t i o n m l l l a g e levy* f o r a l l p r a c t i c a l purposes* a p er m a n e n t tax* as 1 t do es n o t e x p i r e and c o u l d o n l y be changed by a s p e c i f i c v o t e o f t h e e l e c t o r s o f t h e coun ty school d i s t r i c t 1n q u e s t i o n . 5. A s y st e m o f r e i m b u r s e m e n t t o a l l c o n s t i t u e n t s c h o o l d i s t r i c t s was d e t a i l e d ( S e c t i o n 14) based on a I 1 k e - p e r c e n t payment f o r t h e per c a p i t a a d d i t i o n a l c o s t s o f p r o v i d i n g s p e c i a l e d u c a t i o n programs and s e r v i c e s . P u b l i c Act 269 o f 1955 1. The Act was t i t l e d , ' T h e School Code o f 1955.” The p u r p o s e was t o o r g a n i z e a l l t h e l e g i s l a t i v e la w s p e r t a i n i n g t o e d u c a t i o n un d er one p i e c e of l e g i s l a t i o n and numbering scheme and t o u p d a t e t h e la w s p e r t a i n i n g t o p u b l i c e d u c a ­ tion. In t h i s p r o c e s s , t h e p r o v i s i o n s o f P u b l i c Act 18 of 1954 w ere r ep ea le d * and r e - a d d e d a s S e c t i o n s 309 t o 327 of P u b l i c Act 269 o f 1955. C o n te n t Summary o f t h e Legal P r o v i s i o n s Year 1955 P u b l i c Act 269 o f 1955— c o n t i n u e d 2. 1955 a. The p o p u l a t i o n l i m i t s f o r c o u n t i e s t o be e l i g i b l e t o a d o p t t h e s p e c i a l e d u c a t i o n p r o v i s i o n s w ere lo w e r e d from 390»000 o r o v e r t o 180#000 o r o v e r . b. Language was added t o a l lo w f o r t h e j o i n i n g o f two o r more c o u n t i e s of l e s s t h a n 15»000 p e o p l e each# w i t h t h e "combined d i s t r i c t " e l i g i b l e t o a d o p t a s p e c i a l e d uc a­ t i o n m l l l a g e le v y and t h e accompanying p r o v i s i o n s . Michigan P u b l i c Act 4 o f t h e F i r s t E x t r a S e s s i o n o f 1955 1. 1962 The School Code o f 1955 I n c o r p o r a t e d e s s e n t i a l l y t h e same la n g u a g e a s P u b l i c Act 18 o f 1954# e x c e p t f o r t h e f o l l o w i n g two ch a n g e s 1n S e c t i o n 310. T h i s Act amended S e c t i o n 310 o f P u b l i c Act 269 o f 1955# t o e l im i n a te th e population requirem en ts fo r th e adoption of a s p e c i a l e d u c a t i o n m l l l a g e and t h e accompanying p r o v i s i o n s . Michigan P u b l i c Act 190 o f .. 19.62 1. T h i s Act amended P u b l i c Act 269 o f 1955 by addi ng 45 new S e c t i o n s ( S e c t i o n s 29 1 a-3 2 8a ) t o c r e a t e " I n t e r m e d i a t e s c h o o l d i s t r i c t s " from t h e f o r m e r l y t i t l e d "county school d istricts." 2. The s e c t i o n numbers o f t h e s p e c i a l e d u c a t i o n p r o v i s i o n s ( S e c t i o n s 309-327) w er e r e p e a l e d and t h e n added a s S e c t i o n s 307a t h r o u g h 324a. Language m o d i f i c a t i o n s o c c u r r e d t o accommodate t h e name ch ang e; however# t h e r e w ere no s u b s t a n t i v e ch a n g e s 1n t h e p r o v i s i o n s f o r t h e e d u c a t i o n of handicapped c h i ld r e n . 3. The p r o v i s i o n s f o r a d o p t i o n o f a s p e c i a l e d u c a t i o n m l l l a g e le v y were l o c a t e d 1n S e c t i o n 307 a. 4. The p r o v i s i o n s g o v e r n in g t h e d i s t r i b u t i o n o f s p e c i a l e d u c a t i o n m l l l a g e fu n ds t o c o n s t i t u e n t d i s t r i c t s w ere l o c a t e d 1n s e c t i o n 309a. C o n te n t Summary o f t h e Legal P r o v i s i o n s Year 1963 P u b l i c Act 191 o f 1963 1. 1971 1976 T h i s Act amended P u b l i c Act 269 o f 1955# a s amended# by a d d i n g a S e c t i o n 316b# which a l l o w e d f o r t h e I n c r e a s i n g o f a s p e c i a l e d u c a t i o n m l l l a g e l e v y by a m a j o r i t y v o t e o f t h e e l e c t o r s o f an I n t e r m e d i a t e sc ho ol d i s t r i c t . Previous l e g i s l a t i o n c o n t a i n e d no p r o v i s i o n s f o r t h e I n c r e a s i n g o f a s p e c i a l e d u c a t i o n levy# once a d o p t e d . P u b l i c Act 198 o f 1971 1. P u b l i c Act 198 o f 1971 1s p o p u l a r l y r e f e r r e d t o a s " M ic hi ­ gan’s Mandatory S p e c i a l E d u c a ti o n Act." 2. T h i s Act r e p e a l e d t h e s e c t i o n c o n c e r n i n g t h e d i s t r i b u t i o n of s p e c ia l e d u c a tio n m l l l a g e funds t o c o n s t i t u e n t school d i s ­ t r i c t s ( S e c t i o n 319a o f P u b l i c Act 269 of 1955# as amended) and added a new s e c t i o n (317a)# which r e q u i r e d t h a t t h e S t a t e Board o f E d u c a ti o n d e v e l o p r u l e s g o v e r n i n g t h e d i s t r i ­ b u t i o n o f s p e c i a l e d u c a t i o n m l l l a g e fu n ds . P u b l i c Act 451 o f 1976 1. T h i s l e g i s l a t i o n and o t h e r Acts of t h e same t y p e a r e o f t e n r e f e r r e d t o a s " r e - c o d 1 f 1 c a t i o n a c t s . " The p u r p o s e 1s t o merge a l l r e l a t e d A cts and a r r a n g e them s y s t e m a t i c a l l y und er one l e g i s l a t i o n and nu mb eri n g scheme. However# 1 t 1s I m p o r t a n t t o n o t e t h a t t h e goal o f a r e - c o d 1 f 1 c a t 1 o n a c t 1s n o t t o change t h e I n t e n t i o n o f any l e g i s l a t i o n # b u t t o p u t t h e law t o g e t h e r 1n one p l a c e . 2. The p r o v i s i o n s f o r t h e a d o p t i o n o f a s p e c i a l le v y and t h e r e q u i r e m e n t t h a t t h e S t a t e Board o f E d u c a t i o n d e ve l o p r u l e s governing th e d i s t r i b u t i o n of sp e c ia l education m l lla g e fu nd s w er e I n c o r p o r a t e d w i t h i n t h e p r o v i s i o n s o f P u b l i c Act 451 o f 1976 1 n S e c t i o n 1722 (1) and S e c t i o n 1729 (1), respectively. 3. Language c o n c e r n i n g t h e removal o r r e d u c t i o n o f I n t e r m e d i a t e sc h o o l d i s t r i c t s p e c i a l e d u c a t i o n m l l l a g e ( S e c t i o n 2 of P u b l i c Act 18# a s amended) was n o t I n c l u d e d . Year 1980 C o n te n t Summary o f t h e Legal P r o v i s i o n s R e v i s i o n o f t h e M i c h i g a n . S p e c i a l E d u c a ti o n Rules 1. Added tw o r u l e s (Rule 340.1811 and Rule 340.1812) t o t h e M ich ig an S p e c i a l E d uc a ti o n Ru le s t o govern t h e use and d i s t r i b u t i o n o f I n t e r m e d i a t e s ch o ol d i s t r i c t s p e c i a l e d u c a t i o n m l l l a g e fun ds t o c o n s t i t u e n t school d i s t r i c t s . APPENDIX D MICHIGAN DEPARTMENT OF EDUCATION CATEGORIES AND DEFINITIONS OF ALLOWABLE SPECIAL EDUCATION COSTS 175 176 Michigan Department o f Education D E P A R T M E N T S E R V IC E S D 5-4096-A (Actual Cost) 4 /8 4 D or 3 0 1 0 6 , L a n s in g . M ic h ig a n 4 8 9 0 9 AU THOR ITY: A ct M . P * t m ■III f v U «a ■ (F a llw r* C O H P kC rtO N ; D irect q u e s tio n s regarding th is form to the Sta te A i d U n it a t (517) 3 7 3 -3 3 W . M fllw ■ ISW>NH»g * t 1913-84 LOCAL AND INTERMEDIATE DISTRICT SPECIAL EDUCATION ACTUAL COST REPO RT AND SUPPLEM ENTAL PROGRAM SCHEDULES E D U C A T IO N A L AG ENCY L e g a l N am e o f S c h o o l D is tr ic t D is tr ic t C od e N o. T e le p h o n e - A rea C o d e /L o c a l No. A d d r ess C ity Z ip C o d e H A ILIN G IN STR U C TIO N S: OISTRICT - R.turn Retain INTERMEDIATE DISTRICT - Return Retain WHITE. YELLOW and PINK c o p la , by SEPTEMBER 30. 1984 to i n U n r .d i .t . d l.tr le t. BLUE cop y. WHITE and YELLOW c o p ie s by OCTOBER 29, 1984 to th e STATE a d d ress in d icated above. PINK copy for your record. IM PO R T A N T — F i l e t h is form by th e a b o v e d u e d a te . f i l e an am en d ed report im m e d ia te ly . If la te r a u d ite d fig u r e s c h a n g e th e d ata rep o rted for a program , IN ST R U C T IO N S: 1. Every sch ool d istric t operating a s p e c ia l education program must file a ce rtific a tio n page and a p age 2. "Summary o f S p ecial Education Eapenditures.*' Total allo w a b le expenditures for s p e c ia l ed u cation reported on page 2 must agree w ith the o ffic ia l accounting records o f the sch o o l d istrict. 2 . Every sch o o l d istric t operating a s e c tio n 52 program m ust f ile DOTH a DS-4096-A page 3 and a DS-4096-A page 4 . The page 3 must be marked a s s e c tio n 52 and the total must agree w ith the page 4 total. P age 3 w ill be used by Department S ervices for distribution of s e c tio n 52 funds; page 4 w ill be u sed by Special Education S erv ices for monitoring, program and fis c a l review . * 3 . Every sch o o l d istrict that operates a s e c tio n 53 program must f ile BOTH a DS-4096-A page 3 and a DS-4096-A page 5. The page 3 must be marked a s s e c tio n 53 and the total must agree w ith the page 5 total. P age 3 w ill be u sed by Department S ervices for D istribution of s ectio n 53 funds; page 5 w ill be u sed by Special E ducation S erv ices for monitoring, program and fis c a l review . 4 . S ch ool d istric ts operating both s e e tio n 52 and se c tio n 53 programs must file sep arate DS-4096-A page 3 forms for e a c h program. 5. School d istric ts where Mental Health-operated State Institutions or Mental Healtt>contracted nursing hom es are located m u st file a separate page 3 and p age 5 for ea c h Mental H ealth-operated State Institution or Mental Healthcontracted nursing home for the m entally retarded (impaired). Do NOT com plete a page 3 and p age 5 for personnel em ployed and c o s ts incurred by Mental Health-operated State Institu tion s for th e m entally ill (em otionally Impaired). 6. ONLY the Intermediate School D istrict w ill report T itle V l-B, P .L . 9 4 —142 Flow Through c o s ts to the State using forms DS-4044 and DS-4096-A page 6. (P le a s e read the Instructions for d efin itio n of flow through p ro jects.) L ocal d istr ic ts are to report expenditures equal to the federal dollars and the membership funds for th e se projects to the Intermediate School D istrict on page 6. The total o f page 6 must equal the amount on page 2, line 3. Local d is ­ tricts file page 6 with their Intermediate School D istrict. The Intermediate School D istrict must subm it a com ­ p o site page 6 to Department S erv ices. 7 . P le a s e review the detailed instructions for the forms and the 1983—8 4 Special Education A llow ab le Expenditures g u id elin e s before completing the forms. C E R T IF IC A T IO N : I certify that the information subm itted on th is report is true and correct to the b est o f my know ledge. T his report w as prepared in cooperation w ith the B u sin ess sta ff and th e c o s t s reported are proper ch arges to sp e cia l education. All records and sch ed u les (including time reports supporting proration of personnel) u sed In the preparation o f th is report w ill be kept for three years fo r a u d it purposes. Superintendent or Authorised O fficial Contact Person _________________________________________________________________ (Signature) _________________________________________ Telephone (Area C o d e/L o ca l Number 177 D istrict Coda DS-4096-A (Actual Coat) (P age 2) D istrict Name SUMMARY O F S P E C IA L E D U C A T IO N E X P E N D IT U R E S I. A llow ab le expenditures for section- 52 (attach BOTH a page 3 and a supplem ental sch ed u le (page 4) for s e c tio n 52) $ 2. A ltow abla expenditures for s e c tio n 53 (attach BOTH a p age 3 and a supplem ental sch ed u le (paga 5) for sa c tio n 53) S NOTE: If you oparate programs for Mental Haalth-oparatad State In stitu tion s or Mental Haalth*contractad nursing hom es, submit a separata p a g e 3 and supplemental sch ed u le (paga 5) for each Institution or nursing home. A llow ab le expenditures for T itle V l-B, P .L . 9 4 —142 Flow Through p ro jects (T h ose expenditures are to be reported by the local ed u cation a g e n c ie s to the interm ediate sch o o l d istrict. ONLY the Intermediate sch o o l d istrict w ill f ile a DS-4044 and supplemental sch ed u le for th e s e exp en d itu res. Expenditures reported are to equal BOTH federal funds and membership funds.) Both local d istr ic ts and Intermediate d istr ic ts are to show their expenditures o f th e s e funds on th is line. 3a. *. (Federal) 3 b. S (Membership) 3c. $ (Total) 4. A llow ab le expenditures for other federally funded s p e c ia l ed u ca­ tion programs S. Total a llo w a b le expenditures for sp e cia l ed u cation (T otal o f fin e s I. 2 , 3 c ., and 4.) E x p la n a tio n o f E ip a n d itu r e s on L in e 4 A b o v e SOURCE AM OUNT 178 1983-84 SPECIAL EDUCATION ACTUAL COST REPORT (July I through J u n e 3 0 ) (A c,“*' Cost) , (C om plete a separate report for each program.) [~ J S ection 52 [^71 S ection 53 OBJECT L egal Name o f D istrict 1^ > Purchased S erv ices Other E xp en ses 1000 3000 - 4000 2000 sind 5000 - 8000 (1 ) (2) (3) A ddress 5* Salaries D istrict No. O IU PH 1 1 Fun ctions 1 to o TOTAL (4) Instruction 2 122 9 Special Education 4 » IXX Employee B enefits Pupil Support Services 210 • 212 213 > 214 2IS 216 P sych ological S ervices Speech and Audiology S ervices 217 218 V isual Aid Services Teacher C onsultants : f* t »r 19 u 220 to y 2i 219 Other Pupil Support S ervices Instructional Staff Support Improvement of Instruction Library •» VI 44 C r 227 Supervision & Direction Other Educational Media S ervices 229 Other Instructional M V to 19 Social Work S ervices 221 222 223 225 226 tft t G uidance S ervices Health Services y r a u. A udiovisual Computer B ased Instruction 230 General Administration 232 E xecutive Administration 239 Other General Administration 2e 240 27 2S0 Sch oof Administration B u sin ess Services 259 Other B u sin ess S ervices 257 Internal S ervices Central Support S ervices 262 Planning and Research 29 M 2 4 © 23 29 79 260 90 J 1 266 269 9? 93 94 93 2XX 300 >0 37 9A 99 43 41 42 49 3XX <00 43 231 2SS 4 . Em ployee B en efits Community S ervices 330 | C ivic A ctivity ‘Em ployee B en efits Outgoing Transfer and T ransactions ee ee C apital Outlay Board of Education Pupil Transportation (See. S3 only) T uition — Sehool for the Blind Tuition — School for the Deaf 44 49 Oats P rocessin g S ervices Other Central Support | 430 j School S ervice Fund SUBTOTAL (Sum of lin e s 1 thru 39) Indirect C osts t ) 254 D irect Operation and Maintenance R en t/L ea se * Spec. Education F a c ilitie s 44 1 su e TOTAL - (Sum o f lin e s 41 thru 48) 33 GRAND TOTAL (Total of lin es 40 and 49) • • T o t a l s c a n n o t e x c e e d 15% of lin e 4 0 , co lu m n 4 . a * T o ta l m u st e q u a l t o ta l o f s u p p le m e n ta l s c h e d u le a tta c h e d . D istrict Name Df D istrict Code (AcCual Cost) ip . 1983-84 SPECIAL EDUCATION ACTUAL COST SUPPLEMENTAL SCHEDULE (J u ly I through J u n e 3 0 ) SECTIO N 52 (SE C T IO N S2) L 1 N E S Personnel in S .Y .F .T .E . CLASSROOM PROGRAMS I 2 3 Educable Mentally Impaired Trainable Mentally Impaired S everely Mentally Impaired 4 5 Emotionally Impaired Learning D isabled 6 Hearing Impaired 7 V isually Impaired D escription 8 Phys. and 0 . H. Impaired 9 Severely Multiply Impaired S a v a r a iy Language Impaired 12 SUPPORT SERVICES T.C. Mentally Impaired 13 T.C. Emotionally Impaired 14 T .C . Learning D isabled IS 16 T.C. Hearing Impaired T.C. V isually Impaired 17 T.C. Phys. and O.H. Impaired 18 19 Preprimary Home Program 20 Speech and Language Impaired 21 P .E . Special Education OTHER RELATED SERVICES 22 School Social Worker School P sy ch o lo g ist Curriculum R esources Occupational Therapist P h ysical Therapist Other Professional Personnel Prod, of V is. Hdcpd. Materials 30 32 (3) Rate % (S) .. * Direct Operation and Maintenance R en t/L ea se (6) (7) Capital Outlay and Board o f Education (8) Total C ost (9) Director (full-time) Supervisor (full-time) 27 31 (2) Program C ost Homcbound and H ospitalized 26 28 29 (0 Relmb. Secretary A ides Clerk Preprimary 10 II 23 24 25 Profes­ sional * S ee instructions for lim itations. Indirect C ost '£•#*4$:: "Transjpdrtatf an I Tuition — School for the Blind 33 Tuition — School for the Oeaf 34 TOTAL* • T o ta l o f th is s u p p le m e n ta l s c h e d u le m u st e q u a l p s g c 3 s u b m itte d fo r S e c tio n 5 2 . n rrrn O istrlct Code I District N im t DS *o SECTIO N S3 Personnel in S .Y .F .T .E . L 1 S D escription CLASSROOM PROGRAMS 1 2 3 Educable Mentally Impaired Trainable Mentally Impaired Severely Mentally Impaired 4 Emotionally Impaired Learning D isabled 5 6 Hearing impaired 7 V isually Impaired Phys. and 0 . H. Impaired 8 9 P rofes­ sional (I) Reimb. Secretary Cleric A ides (2) (3) Program C ost (4) Indirect C ost Rate * (5) • Direet Operation and Maintenance R en t/L ea se (6) (7) Capital Outlay and Board o f Education (8) Total C ost (9) ............ .. Severely Multiply Impaired Preprimary Severely Language Impaired 10 ii SUPPORT SERVICES f2 T.C. M entall' Impaired 13 T.C . Emotionally Impaired 14 T.C . Learning D isabled IS T.C . Hearing Impaired 16 T.C . V isually Impaired 17 T.C . P h ys. and O.H. Impaired Preprimary Home Program 18 19 Homebound and H ospitalized 20 Speech and Language Impaired 21 P .E . Special Education OTHER RELATED SERVICES 22 School Social Worker 23 24 School P sy ch o lo g ist Director (full-tim e) Supervisor (full-tim e) 2S 26 Curriculum R esources 27 Occupational Therapist 28 29 P h ysical Therapist Other P rofessional Personnel 30 Prod, of V is. Hdcpd. Materials ' Pupil Transportation 31 32 . 33 34 y T uition ~ School for the Deaf — School fo r theJJlJnd TOTAL** •Show only Total C ost amount. Detail to be shown on DS-4094. • • T o t a l o r t h i s supplem ental sch ed ule m u s t e q u a l p a g e 3 s u b m itte d for S e c tio n 53. i O istrlct Name __________ D iitrlct Code i: : 1983-84 SPECIAL EDUCATION ACTUAL COST SUPPLEMENTAL SCHEDULE T IT L E V l - B l J u lT * Ihfoxgh -In"* 3 0 ) P .L . 9 4 - 1 4 2 FLOW THROUGH - T o b e f ile d w ith t h e S T A T E O N L Y by th e I.S .O . (L o c a l D is t r ic ts a re to report to th e I .S .D .) (Do NOT include State Initiated or Preschool Incentive C o sts.) e See instructions for lim itations. L f N E S Personnel in S .Y .F .T .E . D escription CLASSROOM PROGRAMS 1 2 3 Edueable Mentally Impaired Trainable Mentally Impaired S everely Mentally Impaired 4 5 Em otionally Impaired L earninf Disabled 4 Hearing Impaired 7 8 V isu ally Impaired P h ys. and 0 . M. Impaired 9 S everely Multiply Impaired 10 11 Preprimary (S.B. Endorsement) Severely Language Impaired 17 SUPPORT SERVICES T.C . Mentally Impaired 13 14 T .C . Em otionally Impaired IS 14 T.C . Hearing Impaired 17 T.C . P h ys. and O.H. Impaired Preprimary Home Propam T .C . Learning D isabled T.C . V isu ally Impaired 18 19 Homebound and H ospitalized Speech and Language Inferred 70 21 P E . Special Education OTHER RELATED SERVICES 22 School Social Worker School P sy ch o lo g ist 23 24 25 Director (full-time) Supervisor (full-tim e) 24 Curriculum R esources 27 Occupational Therapist P h y sica l Therapist Other P rofession al Parsonnel 28 29 Prod, o f V is. Hdepd. Materials 30 31 • P u p il Transportation:; 32 Tu ition - Schodl for trie Blind 33 T u ition — School for the D eaf 34 TOTAL P rofes­ sional (1) Reimb. Secretary A ides Clerk (2) (3) Program C ost (4) Indirect Cost Rate . (5) % • Oirect Operation and Maintenance R en t/L ea se Capital Outlay and Board o f Education Total C ost (4) (7) to) (9) 182 (p a g e 1 ) 1983-8* INSTRUCTIONS FOR FORM DS- A096 SPECIAL EDUCATION COST REPORT AND SUPPLEMENTAL PROGRAM SCHEDULES GENERAL INSTRUCTIONS T h e DS-A096 s h a l l report costs for the school year July 1 to June 30. S e p a r a t e a c t u a l c o s t r e p o r t s , ( f o r m DS-A096, p a g e 3 ) a n d a s u p p l e m e n t a l p r o g r a m s c h e d u l e ( f o r m DS -A0 96 , p a g e s A a n d 5) m u s t b e c o m p l e t e d f o r S e c t i o n 52 a n d S e c t i o n 5 3 . Check the a p p r o p r i a t e b ox on e a c h p ag e 3. T h e t e r m P . L . 9 A- 1A2 f u n d s a 9 u s e d I n t h i s d o c u m e n t r e f e r s t o a l l P . L . 9 A- 1 A2 f u n d e d p r o j e c t s a u t h o r i z e d I n t h e S t a t e S c h o o l A i d A c t . These I n c l u d e r e g u l a r P . L . 9 A- 1 A2 f u n d s f o r f l o w t h r o u g h p r o j e c t s , S p e c i a l E d u c a t i o n L e a r n i n g Media C e n t e r s p r o j e c t s , c o o r d i n a t o r s of p l a n n i n g , m o n i t o r i n g a n d d a t a c o l l e c t i o n p r o j e c t s , a n d P . L . 9 A- 1A2 a d d e d c o s t projects. C o s t r e p o r t s f o r P . L . 9 A- 1A2 f u n d e d p r o j e c t s a r e t o b e r e p o r t e d t o t h e s t a t e by t h e i n t e r m e d i a t e d i s t r i c t o n l y . C arryover funds a r e t o be r e p o r t e d i n t h e y e a r i n w h i c h t h e y a r e e x p e n d e d . These funds I n c l u d e flow th ro u g h c a r r y o v e r , added c o s t c a r r y o v e r , and S p e c i a l E d u c a t i o n L e a r n i n g Me d i a C e n t e r c a r r y o v e r when a u t h o r i z e d . A DS-AOAA, a s w e l l a s a D S - A 0 9 6 , S u p p l e m e n t a l P r o g r a m S c h e d u l e ( f o r DS-A096, pa g e 6 ) , m us t b e c o m p l e t e d f o r e a c h o f t h e ab o v e p r o j e c t s . L o c a l d i s t r i c t s t h a t a r e e x p e n d i n g P .L . 9A-142 f u n d s a r e t o r e p o r t t h e i r expend itures to the Interm ediate d i s t r i c t . P lease note th a t a l l preschool incentive p ro ject c o s ts, as w ell as c o s ts f o r s t a t e i n i t i a t e d p r o g ra m s n o t l i s t e d a b o v e , a r e r e p o r t e d o n l y on t h e DS-AOAA. R e c o r d a l l a m o u n t s o f money t o the n e a re st d o lla r . The g e n e r a l c l a s s i f i c a t i o n o f o b j e c t s o f e x p e n d i t u r e s a r e t h o s e which a r e found i n B u l l e t i n 1022, t h e a c c o u n t i n g manual f o r s c h o o l d i s t r i c t s . The s p e c i f i c item s which have been approved f o r s p e c i a l e d u c a tio n r e i m b u r s e m e n t a r e shown i n t h e d e t a i l e d i n s t r u c t i o n s e n t i t l e d " S p e c i a l E d u c a t i o n A l l o w a b l e E x p e n d i t u r e s - 1 9 8 3 - 8 A ” s t a r t i n g o n pa g e 16 of t h e s e directions. The o b j e c t s of e x p e n d i t u r e s h o u l d be a s s i g n e d t o t h e program f o r which Ch e s e r v i c e o r s u p p l y w a s a c q u i r e d o n a d i r e c t c h a r g e b a s i s w h e r e v e r p o s s i b l e , o r by a m e t h o d o f a l l o c a t i o n w h i c h w i l l p r o v i d e a r e a s o n a b l e d i s t r i b u t i o n of c o s t s . T h e a l l o c a t i o n s o n c e d e t e r m i n e d s h o u l d be p o s t e d t o t h e program a c c o u n t s and a d j u s t e d from t h e a c c o u n t i n which t h e o r i g i n a l c h a r g e was made. Documentation of a l l o c a t i o n s and p r o r a t l o n s must be m a i n t a i n e d f o r a u d i t p u r p o s e s . 183 (p ag e 2 ) CENERAL INSTRUCTIONS SPECI F I C ITEHS 1. E a r l y r e t i r e m e n t I n c e n t i v e p a y m e n t s I n c l u d e ( a ) lump sum p a y m e n t s , (b ) r e t i r e m e n t i n c e n t i v e payments s p read o v er t h e f o l lo w in g y ear, and ( c ) t h e p u r c h a se of a n n u i t i e s as a r e t i r e m e n t . T h e s e i n c e n t i v e s do n o t q u a l i f y f o r s t a t e c a t e g o r i c a l o r P.L. 94-142 reim bursem ent. Tho e a r l y r e t i r e m e n t i n c e n t i v e payment p l a n I s d e v e l o p e d f o r t h e c o n v e n i ­ e n c e of t h e s c h o o l d i s t r l e c and i s n o t d i r e c t l y r e l a t e d t o p r o v i d i n g s e r v ic e s to handicapped stu d e n ts. 2. S t i p e n d s f o r p e r s o n n e l who r e t i r e e a r l y o r p r e p a i d I n s u r a n c e f o r p e r s o n n e l wh o r e t i r e e a r l y d o n o t q u a l i f y f o r c a t e g o r i c a l r e i m b u r s e ­ ment o r f o r r e im b u r s e m e n t u n d e r P.L . 94- 1 4 2 . T h e s e p a y m e n t s a r e made a s an I n c e n t i v e f o r p e r s o n n e l to r e t i r e e a r l y and a r e n o t p a r t o f th e o r d i n a r y f r i n g e b e n e f i t s a n d o p e r a t i o n a l c o s t s o f Che d i s c r l c t . 3. Payment o f u n u s e d s i c k l e a v e i s r e i m b u r s a b l e t o t h e e x t e n t t h a t t h e s ! ck l e a v e wa s a c c r u e d d u r i n g s e r v i c e t o t h e c a t e g o r i c a l p r o g r a m . For e x a m p le , i f an em plo y ee worked f i v e y e a r s i n a g e n e r a l e d u c a t i o n p r o ­ gram and f i v e y e a r s I n a s p e c i a l e d u c a t i o n pro gram , t h e s p l i t I n t h e r e i m b u r s e m e n t f o r u n u s e d s i c k l e a v e s h o u l d b e 30Z t o e a c h . 4. Expenditures f o r R e p a i r and M a inte nance C o s t s f o r r e p l a c e m e n t o f i t e m s su c h a s c a r p e t s , windows a nd l a v a t o r i e s a s r e p a i r and r e p l a c e m e n t c o s t s a r e r e i m b u r s a b l e u n d e r o p e r a t i o n and maintenance. I f d i s t r i c t s q u a l i f y t o c laim d i r e c t o p e r a t i o n and main­ t e n a n c e f o r a b u i l d i n g , t h e s e c o s t s may b e I n c l u d e d i n t h e d i r e c t o p e r a t i o n and m ain tenan ce reim bursem ent. D i r e c t o p e r a t i o n and m a i n t e n a n c e c o s t s p l u s I n d i r e c t c o s e s c a n n o t e x c e e d 15X o f d i r e c t costs. 5. Lease Purchase Lease purchase of S c h o o l Aid A c t . 6. facilities I s noc r e i m b u r s a b l e u n d e r t h e S t a t e P a y b a c k o f O v e r - R e i m b u r s e d E x p e n s e s 33 a R e s u l t of A u d it o r M o n ito rin g D i s t r i c t s c i t e d a s a r e s u l t of an a u d i t o r m o n ito rin g e x c e p t i o n w i l l be r e q u i r e d t o pay back any s t a t e o verpaym ent. The d i s t r i c t s ha ve s p e c i f i c d i r e c t i o n s from t h e Department i n r e g a r d t o what I s r e im b u rs ­ a b l e and what i s no t r e im b u rs a b le . Only i t e m s l i s t e d o n t h e a t t a c h e d S p e c i a l E d u c a t i o n A l l o w a b l e E x p e n d i t u r e s f o r S e c t i o n 5 2 , S e c t i o n 5 3, a n d P . L . 9 4 - 1 4 2 Flow T h r o u g h C o s t s w i l l b e a p p r o v e d f o r r e i m b u r s e m e n t u n l e s s t h e d i s t r i c t p r o v i d e s e v i d e n c e o f p r i o r w r l c t e n a p p r o v a l from th e Department of E ducation. I f d i s t r i c t s w i s h t o a p p e a l any item t h e y h av e t h e r i g h t t o do s o . S p e c i a l E d u c a tio n S e r v i c e program s t a f f w i l l c o o p erace w i t h Department S e r v i c e s i n r ev iew in g any ap p ealed Items. I8 F e d e r a l Funding: M N P R S T o ta l S ta te /F e d e ra l D irect Costs Less: State D irect Federal Direct F ed eral I n d i r e c t Cost ($73,064.99 x 2.352) T o ta l Federal Cost F ederal Carry-over F ederal Grant T o ta l Federal Cost T o ta l Federal Carry-over $89,564.34 16.499.35 $73,064.99 1.717.C3 $74,782.02 $75,000.00 74,782.02 $ 217758 ( D) (lib) $____________________ (D) _____________________ (Hb) $____________________ (M-H) _____________________ ( GxP) $____________________ (C+R) $ ( E) _____________________ ( S ) $____________________ ( E - S ) T o t a l 94-142 P r o j e c t S tate Portion Federal Portion Total $18,726.76 74,782.02 $93,508.78 5 $ 193 (p age 1 2 ) I n * t r u e Cions f o r t h e W orksheet f o r a P .L. 94-142 P r o j e c t w i t h Memberships The P .L . 94-142 program i s J o i n t l y f unde d w i t h membership monies and f e d e r a l monies. To p r o p e r l y b u d g e t , a c c o u n t a n d r e p o r t t h e s e f u n d s t h e y s h o u l d b e i d e n t i f i e d as s e p a r a t e fund s o u r c e s . V a r ia n c e s between I n d i r e c t c o s t r a t e s a n d t y p e s o f e x p e n d i t u r e s t h a t c a n b e f i n a n c e d w i t h t h e t wo s o u r c e s o f money r e q u i r e a b r e a k o u t of d i r e c t and l n d i r e c c c o s t s . The accom pan yi ng s c h e d u l e i s b o th an example t o e x p l a i n che s e p a r a t i o n p r o c e s s and a w o r k s h e e t f o r t h e d i s t r i c t t o u s e I n o b t a i n i n g I t s own b r e a k o u t o f Che two f u n d i n g s o u r c e s . T h e p r o c e s s m u s t be c o m p l e t e d w o r k i n g w i t h t h e s t a t e f u n d i n g f i r s t . A. O b t a i n Che n u m b e r o f s p e c i a l e d u c a t i o n m e m b e r s h i p s f r o m t h e F o u r t h F r i d a y R e p o r t , DS-4061 an d p l a c e on t h e b l a n k l i n e (A). B. Determine th e g r o s s membership allo w an ce f o r p u p i l s In your d l s t r l c c f ro m i n f o r m a t i o n o b c a l n e d f rom t h e S c a c e Ai d S t a t u s R e p o r t , R2749. To c o m p u t e t h e g r o s s m e m b e r s h i p a l l o w a n c e , a d d $328 + ($39 x number o f m i l l s l e v i e d ) . C. S t a t e f u n d i n g i s d e t e r m i n e d by m u l t i p l y i n g t h e n u m b e r o f F . T . E . m e m b e r s h i p s r e c o r d e d o n l i n e A by t h e g r o s s m e m b e r s h i p a l l o w a n c e d e t e r m i n e d f o r l i n e B a nd e n t e r che r e s u l t on l i n e (C ). D. D e t e r m i n e che t o t a l d i r e c t e x p e n d i t u r e s r e c o r d e d i n t h e s c h o o l d l s t r l c c a c c o u n t s f o r t h e 9 4 - 1 4 2 / s c a t e membership a l l o w a n c e p r o j e c t and e n t e r t h i s amount on l i n e (D). E. O b t a i n t h e 94 -1 42 a p p r o v a l b u d g e t f o r t h e 94 -1 42 p r o j e c t and d e t e r m i n e t h e amount of f e d e r a l f u n d s a l l o c a t e d t o t h e p r o j e c t . E n t e r t h e amount on l i n e ( E ) . F. E x a m i n e c h e S p e c i a l E d u c a t i o n r a c e p r i n t o u t R041 6 a n d e n t e r t h e r a t e f o r th e d i s t r i c t on l i n e ( F ) . G. E x a m i n e c h e F e d e r a l I n d i r e c t C o s t R a c e p r i n t o u t , R0413 f o r l o c a l s c h o o l d i s t r i c t s o r che a p p r o v e d r a t e as d e t e r m i n e d from I n f o r m a t i o n s u b m itte d on i n t e r m e d i a t e d i s t r i c t i n d i r e c t r a t e a p p l i c a t i o n DS-4524. The d i s t r i c t m u s t u s e ch e r e s t r i c t e d r a t e w i t h Che 9 4 - 1 4 2 e x p e n d i t u r e s . H. The s t a t e f u n d i n g d e t e r m i n e d o n l i n e ( C) I s t o p r o v i d e t h e amount n e c e s s a r y f o r b o t h s t a t e d i r e c t and s t a t e I n d i r e c t c o s t s . L i n e ( H) i s t o I d e n t i f y t h e p o r t i o n o f c h e g r o s s m e m b e r s h i p a llo w a n c e which i s t o be r e p o r t e d a s s t a t e funded d i r e c t c o s t s . Line (J) i s to i d e n t i f y the p o r tio n f o r in d ir e c t cost. 19** (page 13) (Instructions for worksheet continued) Based on t h e a s s u m p t i o n t h a t d i r e c t c o s t s and I n d i r e c t c o s t s a r e e q u a l t o t h e g r o s s membership a ll o w a n c e ; t h e n , t h e sum o f 100Z f o r d i r e c t c o s t s and t h e p e r c e n t which I s your s t a t e s p e c i a l ed u c a tio n r a te w i l l equal the t o t a l s t a t e funding. To d e t e r m i n e t h e p a r t which Is s t a t e d i r e c t c o s t , perform the computation shown on l i n e ( L ) . Record th e r e s u l t of l i n e (H (b)]. J. To d e t e r m i n e t h e a m o u n t o f I n d i r e c t c o s t c h a r g e a b l e t o state f u n d i n g , m u l t i p l y t h e d i r e c t c o s t s d e t e r m i n e d o n l i n e H by t h e I n d i r e c t c o s t r a t e n o t e d on l i n e ( F ) . R e c o r d t h e computed Indirect cost in line (J(b)]. K. T h e T o t a l S t a t e C o s t s h o u l d b e e q u a l t o t h e sum o f ( J ) a n d c h e c k t o t h e amount shown on l i n e ( C ) . M. The am oun t o f e x p e n d i t u r e N. The amount of e x p e n d i t u r e s P. The amount of e x p e n d i t u r e f o r t h i s l i n e s u b t r a c t i n g l i n e ( N) f r o m l i n e ( M) . R. T h e a m o u n t o f f e d e r a l I n d i r e c t c o s t I s d e t e r m i n e d by m u l t i p l y i n g l i n e ( P ) by t h e r a t e s h o w n o n l i n e ( C ) . S. The t o t a l federal cost is for this line for this t h e sum o f is line ( H) a n d t a k e n from l i n e line is is lines (D). ta k e n from l i n e (H). d e t e r m i n e d by (P) and (R). T h e f e d e r a l c a r r y o v e r I s d e t e r m i n e d by s u b t r a c t i n g t h e f e d e r a l g r a n t shown on l i n e ( C ) . line (S) from The t o t a l e x p e n d itu r e s , d i r e c t and I n d i r e c t , fo r th e p r o je c t d e t e r m i n e d by a d d i n g t h e a m o u n t s s h o w n o n l i n e s ( C ) a n d ( S ) . is ( p a g e 14) SPECIAL EDUCATION .MATE CUL’F. PRCCNAMS General Educable M e ntally Impaired T r a i n a b l e M entally Impaired S ev erely M entally Impaired E m o tionally Impaired Learning Disabled Hearing Impaired V i s u a l ly Impaired P hy s. and O.H. I m pai red S ev erely M u ltip ly Impaired Preprimary S u v e r e l y Language Im pa ire d SUPPORT SERVICES T.C. M entally Impaired T.C. E m o tionally Impaired T.C. L earning Disabled T.C. Hearing Impaired T.C. V i s u a l ly Impaired T . C . P h y s . a n d O. I I. I m p a i r e d P r e p r i m a r y a n d Home P r o g r a m Ho u e b o u n d a n d H o s p i t a l i z e d Speech and Language I m pa ir ed P.E. S p e c i a l Education OTHER RELATED SERVICES School S o c i a l Uorker School P s y c h o lo g is t Director (full-tim e) Supervisor (fu ll-tim e) Curriculum Resources Occupational T herapist Physical T herapist Other P rofessio n al Personnel P r o d , o f V i s . I l dc pd . M a t e r i a l s Pupil T ransportation T u i t i o n - School fo r the Blind T u i t i o n - S c h o o l f o r t h e De a f State Initiated Regular State Initiated Carryover Section 52 Section 53 94- 142 Regular 94«-142 Carryover 201 202 227 228 203 204 205 206 207 208 209 210 231 232 257 258 233 234 235 236 237 238 239 240 801 802 827 828 803 804 805 806 807 808 809 810 831 832 857 858 833 834 835 836 837 838 839 840 861* 862 887 888 863 864 865 866 867 868 869 870 861** 862 887 888 863 864 865 866 867 868 869 870 901 902 927 928 903 904 905 906 907 908 909 910 212 213 214 215 216 217 218 221 201 219 242 243 244 245 246 247 248 251 231 249 812 813 814 815 81 6 817 818 821 801 819 842 843 844 845 846 847 848 851 831 849 872 873 874 875 876 877 878 881 861 879 872 87 3 874 875 876 877 878 881 861 879 912 913 914 915 916 917 918 921 901 919 201 201 201 220 222 223 224 225 226 201 201 201 231 231 801 801 831 831 861 861 861 861 901 901 220 920 850 880 880 920 253 254 255 256 231 231 231 823 824 825 826 801 853 854 855 856 831 883 884 885 886 861 893 884 88 5 886 861 923 924 925 926 901 *Fiseal Year will be designated numerically. Members **F lscal Year w i l l be d es ig n ated a l p h a b e t i c a l l y A- 0 C- 2 E- 4 C- 6 J-8 B-l D-3 F-5 11-7 K- 9 196 ( D i r e c t i o n s f o r Form DS-4096 - page 15) 1 9 6 3 - 8 4 SPECIAL EDUCATION ALLOWABLE EXPENDITURES FOR SECTION 5 2 , SECTION S3 (EXCEPT INSTI TUTION AND NURSINC HOMES) AND P . L . 9 4 - 1 4 2 FLOW-THRU COSTS) This I s a R e f e r e n c e f o r F o r a DS-4096 a n d SE-4625 Codes Function 122 Object INSTRUCTION 1240 1630 1690 1870 2100 2820 2830 2840 2850 3210 3600 3700 4120 4210 4220 Salary A ll approved s p e c i a l e d u ca tio n te a c h e rs . T h is I n c lu d e s t e a c h e r s of homebound an d h o s p i t a l i z e d a n d t e a c h e r s o f p h y s i c a l e d u c a t i o n f o r handicapped In d iv id u a ls Aide S a la ry O n l y a i d e s r e q u i r e d by r u l e o r a p p r o v e d by w r i t t e n w a i v e r a r e reim bursable Interpreter S u b s t i t u t e T eacher (R efer t o S p e c ia l E d ucation I n t e r p r e t a t i o n 1-077) S u b s t i t u t e s f o r P .L. 94-142 p r o f e s s i o n a l development a c t i v i t i e s a r e r e p o r t e d u n d e r F u n c t i o n 221 Employee B e n e f i t s Insurance (Individual health, dental, li f e , 2 tc .) R e t i r e m e n t ( R e f e r t o P2 o f t h e D S - 4 0 9 6 d i r e c t i o n s ) Social Security Workmens' C o m p e n s a tio n Unemployment I n s u r a n c e Purchased S ervices Local T ra v e l ( I . e . s t a f f t r a v e l i n g between b u ild in g s) Note: I n s e r v l c e s / C o n f e r e n c e s a r e t o be r e c o r d e d u n d e r Improvement o f I n s t r u c t i o n 22 1 w i t h o b j e c t 3 1 2 0 o r 3 2 2 0 ) P r i n t i n g f o r I n s t r u c t i o n a l m a t e r i a l s o n ac o n t r a c t e d basis T u itio n - T u itio n paid for studentsattending t h e Michigan School f o r t h e B l i n d and M ic h ig a n S c h o o l f o r t h e Deaf I n s t r u c t i o n a l equipm ent r e p a i r and m ain ten an ce l i m i t e d t o I n s t r u c ­ t i o n a l e q u i p m e n t u s e d 100X f o r s p e c i a l e d u c a t i o n , l a n g u a g e m a s t e r , B l i s s Boards, e t c . R e n t a l s la n d an d b u i l d i n g s , i . e . r e n t i n g c l a s s r o o m s p a ce from o t h e r d i s t r i c t s or o th er agencies. Lease/Purchase Is not reimbursable. R e n ta l equipment of s p e c i a l e d u c a tio n I n s t r u c t i o n a l equipment ( I . e . wheel c h a i r s ) and r e n t a l o f equipment f o r p r i n t i n g of I n s t r u c t i o n a l m aterials 197 (page 16) 5000 Series 6400 7900 S u p p l i e s and M a t e r i a l s T h is In c lu d e s consumable I n s t r u c t i o n a l s u p p l i e s and equipment t h a t a re valued under $300.00. A l l eq ui pm ent must be I n v e n t o r i e d In acco rd an ce w i t h sc h o o l d i s t r i c t p o lic y and s ta n d a r d acco u n tin g procedures. F u r n i t u r e , such as s tu d e n t d esks, t e a c h e r desks, s t o r a g e and f i l e c a b i n e t s I s n o t r e i m b u r s a b l e u n l e s s ap pr ov ed i n t h e P.L. 94-142 program a p p l i c a t i o n . I n s t r u c t i o n a l equipment t h a t Is o rd in a rily a v a ila b le In the building for regular education e t u d e n t s s u c h a s s l i d e p r o j e c t o r s , p a p e r c u t t e r s , e t c . i s noc t o be charged t o s p e c i a l e d u c a t i o n . On l y I t e m s t h a t c s n o r w i l l be u s e d 100Z by s p e c i a l e d u c a t i o n a r e r e i m b u r s a b l e . C a p i t a l O u t l a y - Equipment Equipment and F u r n i t u r e . T h i s I n c l u d e s equip men t and f u r n i t u r e used only f o r I n s t r u c t i o n of s p e c ia l education e l i g i b l e stu d e n ts. E qu ip m en t I s d e f i n e d a s any Ite m t h a t I s v a l u e d a t $3 0 0 . 0 0 o r more. F u r n i t u r e s uc h a s s t u d e n t d e s k s , t e a c h e r d e s k s , s t o r a g e and f i l e ca b in e ts is not reimbursable. I n s t r u c t i o n a l equipment t h a t Is o rd in a rily a v a ila b le In the building for regular education s t u d e n t s , s u c h a s m o v i e p r o j e c t o r s , a r e n o c t o be c h a r g e d Co sp e cial education. M l c r o - c o m p u t e r s u s e d 100Z I n s p e c i a l e d u c a t i o n classrooms f o r I n s tr u c tio n are reimbursable. For f u r t h e r d e f i n i t i o n of c a p i t a l o u t l a y Items reim b u rsab le under P . L . 9 4 - 1 4 2 , r e f e r t o c h e Ma r c h 2 5 , 198 2 memo t o D l r e c t o r a o f S p e c i a l E d u c a t i o n f rom E dward B i r c h e n t i t l e d P r o c e d u r a l C l a r i f i c a ­ t i o n o f A s p e c t s R e l a t i n g t o P u b l i c Law 94--142 F u n d i n g . N o n l n a t r u c t i o n a l equipm ent and rep la c e m e n t of f i x e d a s s e t s a r e not reimbursable. O t h e r Expense M is c e lla n e o u s Expense ( It e m i z e l i s t required fo r approval) PUPI L SUPPORT SERVICE 213 HEALTH SERVICES 1160 1410 1450 1470 1480 1490 1620 1630 3130 3200 21 4 Supervision P h y e l c i a n - l i s t e d a s an employee Nurse ( f u l l time e p e c i a l ed u c a tio n ) Physical Therapist Occupational T herap ist O th er T e c h n i c a l ( w ith Department of E d ucation a p p rov al) S e c r e t a r y / C l e r i c a l ( f u l l time s p e c i a l ed u c a tio n ) Aides (Department of Education approval) P ro f e s s io n a l T echnical - co n tra c te d medical s e rv ic e s Workshops and C o n f e r e n c e s PSTCH0L0CICAL SERVICES 1430 1620 1630 Others Psychologist S e c r e t a r i a l ( f u l l time e p e c i a l ed u c a tio n ) B i l i n g u a l Aldea O ther Aides ( w r i t t e n d e v i a t i o n o r waiver re q u ire d fo r reimburse­ ment of o t h e r a i d e s ) R e f e r t o D i r e c t i o n s f o r I n s t r u c t i o n on page 1 f o r a l l o t h e r o b j e c t expandlturee 198 ( p a g e 17) 215 SPEECH PATHOLOGY AND AUDIOLOGY 12B0 1490 1620 1630 1820 3200 Others 216 SOCIAL WORK SERVICES 1440 1620 1630 1820 3200 Others 21 7 V i s u a l h a n d ic a p p e d media, p r o c e d u r e s and b l i n d m a t e r i a l s M obility S p e c ia lis t S e c r e t a r y / C l e r i c a l ( f u l l time s p e c i a l e d u c a tio n ) Aide ( w r i t t e n a p p r o v a l from S p e c i a l E d u c a t i o n S e r v i c e s ) Workshops and C o n feren ces R e fe r t o D i r e c t i o n s f o r I n s t r u c t i o n on page 1 and 2 f o r all oth er object expenditures TEACHER CONSULTANT 1250 1620 1630 1820 3200 Others 219 S o c i a l Work S e c r e t a r y / C l e r i c a l ( f u l l time s p e c i a l edu catio n) B ilin g u a l Aides O ther Aides ( w r itte n d e v ia tio n or waiver required f o r s t a t e aide reimbursement) S u b stitu te Teacher Workshops and C o n fe re n c e s R e fe r t o D i r e c t i o n s f o r I n s t r u c t i o n on page 1 and 2 f o r a l l other object expenditures VISUAL AID SERVICES 1270 1290 1620 1630 3200 Others 21 8 Speec h and L an gu ag e T h e r a p i s t Audlologlst S e c r e t a r y / C l e r i c a l ( f u l l time s p e c i a l e d u c a tio n ) B ilin g u a l Aides O ther Aides ( w r i t t e n d e v i a t i o n or w aiver req u ired fo r reim burse­ ment o f o t h e r a i d e s ) S u b stitu te Teacher Workshops and C o n feren ces R e f e r t o D i r e c t i o n s f o r I n s t r u c t i o n on page 1 and 2 f o r a l l o t h e r object expenditures SPECIAL EDUCATION I n s tru c tio n a l c o n su lta tio n Includes specialeducation teacher c o n s u l ta n ts and workstudy c o o rd in a to rs S e c r e t a r y / C l e r i c a l ( f u l l time s p e c i a l e d u c a tio n ) Aides ( w r i t t e n w aiver r e q u ire d f o r reimbursement) S u b stitu te Teacher Consultant Workshops and C o n fe re n c e s R e f e r t o D i r e c t i o n s f o r I n s t r u c t i o n s on page 1 and 2 f o r a l l other object expenditures OTHER PUPI L SERVICES ( I n c l u d e s M u s i c T h e r a p i s t , R e c r e a t i o n T h e r a p i s t , a n d " O c h e r P r o f e s s i o n a l P e r s o n n e l ” who q u a l i f y under R 340,1792 and a r e n o t I n c l u d e d e ls e w h e r e , 1490 Other P ro fessio n al 1620 S e c r e t a r y / C l e r i c a l ( f u l l time s p e c i a l e d u c a tio n ) 1630 Aides ( w r i t t e n w aiver r e q u ire d f o r reimbursement) 3200 Workshops and C o n feren ces Others R e fe r t o D i r e c t i o n s f o r I n s t r u c t i o n pages 1 and 2 f o r a l l o t h e r object expenditures 199 (p a g * 18) STAFF SUPPORT SERVICE 221 IMPROVEMENTOF INSTRUCTION Salary Curriculum Resource Consultant S e c r e t a r y / C l e r i c a l ( f u l l Cl oe e p e c i a l e d u c a t i o n ) Aide ( w r i t t e n w a i v e r r e q u i r e d f o r r e im burs em ent) S u b s t i t u t e t e a c h e r s f o r P.L. 94-142 p r o f e s s i o n a l development a c t i v i t i e s only Ochers R e f e r t o D i r e c t i o n s f o r I n s t r u c t i o n on p a g e I a n d 2 f o r a l l o ther object expenditures Purchased S erv ices 3120 Professional technical - outside consultant for lnservlce H on or l uma f o r P . L . 9 4 - 1 4 2 l i m i t e d t o $200 p e r day 3220 Wo r k s h o p l n s e r v l c e a n d c o n f e r e n c e e x p e n s e s f o r s c h o o l d i s t r i c t staff. Expenses f o r n o n - s p e c i a l e d u c a t i o n p e r so n n e l development may o n l y be c h a r g e d t o P . L . 9 4 - 1 4 2 1210 1620 1630 1370 226 SUPERVISION AND DIRECTION INSTRUCTIONALSTAFF 1120 1160 1170 1620 2100 2820 2830 2840 2850 3160 3200 3000 6000 7900 Salary A a a l s t a n t S u p e r i n te n d e n t - f u l l time D i r e c t o r of S p e c i a l E d u cad o n w i t h t h e t i t l e of A s s i s t a n t S u p e r i n t e n d e n t . No t a l l o w a b l e u n d e r f e d e r a l p r o j e c t s o r S e c t i o n 53 S u p e r v i s i o n I n c l u d e s f u l l time S p e c i a l E d u cation S u p e r v iso r . D i r e c t o r o f s p e c i a l e d u c a d o n who I s n o t a n A s s i s t a n t S u p e r i n t e n ­ dent. Not a l l o w a b l e u n d e r P . L . 9 4 - 1 4 2 o r S e c t i o n 53 S e c r e t a r y / C l e r i c a l ( f u l l time s p e c i a l e d u c a tio n ) Employee B e n e f i t s Insurance (individual health, dental, lif e , e tc .) R e t i r e m e n t ( R e f e r t o P2 o f t h e D S - 4 0 9 6 d i r e c t i o n s ) Social Security Wo r k m e n s ' C o m p e n s a t i o n Unempl oyment I n s u r a n c e R e f e r t o t h e Ma r c h 2 4 , 1982 memo o n ' R e i m b u r s e m e n t f o r Unempl oyment C o s t s f o r S p e c i a l E d u c a t i o n P e r s o n n e l ' f r o m E d w a r d L. B i r c h S u p p l i e s , M a t e r i a l s and O th er S e r v i c e s P ro fe s sio n a l te c h n ic a l - r e s t r i c t e d to data processing services fo r the c e n tr a l re g istry (outside co n tracts lim ited to cost for c e n t r a l r e g i s t r y - c o s t c a n n o t i n c l u d e programming c h a r g e s or o v e r h e a d c o s t s - l i m i t e d t o m ac hine t i m e , keypunch and s u p p l i e s ) Workshops and C o n f e r e n c e s S u p p l i e s and m a t e r i a l s of an e x p e n d ib le n a t u r e such as paper, pencils, etc. O f f i c e equipm ent I s not r e im b u rsab le u n l e s s approved f o r f e d e r a l f u n d i n g i n che P .L . 9 4- 14 2 a p p l i c a t i o n C a p i t a l o u t l a y - none u n l e s s approved f o r f e d e r a l fu nding In the P .L. 94-142 a p p l i c a t i o n Other expenses 200 (p a g e 19) 23 1 BOARD OF EDUCATION 3170 3180 3190 Purchased S erv ices L e g a l S e r v i c e s - H e a r i n g o f f i c e r f e e s wh e n a n a t t o r n e y I s h e a r i n g o f f i c e r a s r e q u i r e d by s p e c i a l e d u c a t i o n r u l e s . Note: School a tto r n e y fees for hearings are not allowable A u d it ex p en ses f o r f e d e r a l p r o j e c t s only Professional technical - Hearing o f f i c e r fees I f an atto rn ey la not used. Court reco rd ers fo r hearing cost are Included here 240 SCHOOL ADMINISTRATION ( U s e d o n l y I f a s c h o o l b u i l d i n g I s o p e r a t e d so le ly for sp e c ia l education purposes. C o d i n g o p t i o n s w o u l d be t h e s a n e a s t h o s e u n d e r s u p e r v i s i o n and d i r e c t i o n e x c e p t f o r th e c e n t r a l r e g i s t r y and h e a r i n g s ) 254 DIRECT OPERATION AND MAINTENANCE ( R e f e r t o D i r e c t i o n s o n P a g e 6 ) L im ite d t o f a c i l i t i e s used s o l e l y f o r s p e c i a l e d u c u t l o n where the d i r e c t c o s t method I s u s e d . If a d i s t r i c t chooses to use t h i s m e t h o d , t h e d i s t r i c t m u s t i n c l u d e a d e s c r i p t i o n o f how t h e d i r e c t o p e r a t i o n and m ain ten an ce l a c a l c u l a t e d . T h e d i s t r i c t may n o t c h a r g e I n d i r e c t c o s t s f o r any s p e c i a l e d u c a t i o n s u p p o r t i v e o r r e l a t e d s e r v i c e ho u se d i n a f a c i l i t y f o r whi ch d i r e c t o p e r a t i o n and maintenance la charged. A d e s c r i p t i o n m u s t a c c o m p a n y t h e DS - 4 0 9 6 and I n c l u d e ( a ) a l i s t of a l l s p e c i a l e d u c a t i o n programs, su pp o rt s e r v i c e s and r e l a t e d s e r v i c e p e r s o n n e l housed In t h e f a c i l i t y ; ( b ) che s a l a r y and r e l a t e d c o s t s f o r each; and ( c ) t h e pro ced u re u s e d t o d e d u c t t h e s e c o s t s f r o m t h e i n d i r e c t c o s t c l a i m e d by l i n e item . S p e c i f i c p r o c e d u r e s and e x a m p l e s a r e a v a i l a b l e from t h e S p e c i a l E d u c a t i o n S e r v i c e Area upon r e q u e s t . The c o m b i n a t i o n of d i r e c t a n d I n d i r e c t t o t a l s c a n n o t e x c e e d 15Z o f p r o g r a m c o s t s . 1550 1640 1660 1670 2000 3000 3800 3900 4100 4200 5900 C r a f t s and Trades Custodian Security Laborer Employee B e n e f i t s (same a s f o r t e a c h e r s , Purchased S erv ices U tilities Insurance R e p a i r and M ain ten an ce S e r v i c e s Rentals S u p p l i e s and M a t e r i a l s s e e p a g e 1) 255 PUPI L TRANSPORTATION E x c l u s i v e l y f o r S e c t i o n 5 3 . Cost must I n clu d e the t o t a l r e i m b u r s a b l e e x p e n s e s r e p o r t e d o n t h e DS -40 94, col umn 5, p l u s a p p l i c a b l e employee b e n e f l t a a t t r i b u t a b l e t o p e r s o n n e l s a l a r i e s In column 5 o f t h e DS-4094. 257 INTERNAL SERVICES 1620 2000 Salary O th e r O p e r a t i o n and S e r v i c e s ( sw i t c h b o a r d o p e r a t o r o r r e c e p t i o n ­ i s t I n a f a c i l i t y u s e d o n l y f o r a p e c l a l e d u c a t i o n f o r S e c t i o n 52 a n d 53 e x c l u s i v e l y ) Employee B e n e f i t s ( same a a f o r t e a c h e r s , s e e p a ge 1) 201 (p ag e 20) 2 62 PUNNI NG. RESEARCH, DEVELOP AMD EVALUATION. C o a t U n i t e d t o t h o a e 1001 a t t r i b u t a b l e t o u p e c l a l e d u c a t i o n p r o g r a m s a n d s e r v i c e s 1130 1 62 0 2100 2320 2930 2840 2850 5000 6000 7900 26 6 5900 7900 420 S u p p l i e s , M a t e r i a l s and O th e r S e r v i c e s S u p p l i e s and m a t e r i a l s of an e x p e n d i b l e n a t u r e such aa p a p e r , pencils, etc. O f f i c e equipment I s not r e l a t a i r s a b l e u n l e s s approved f o r f e d e r a l fu nd in g In th e P.L. 94-142 a p p l i c a t i o n C a p i t a l o u t l a y - none u n l e s s approved f o r f e d e r a l funding i n the P.L. 94-142 a p p l i c a t i o n Other expenses Purchased S erv ices Professional Technical CI VI C ACTIVITY ( P a r a n c A d v i s o r y C o m m i t t e e O n l y ) 4900 400 Employee B e n e f i t s Insurance (in d iv id u a l h e a lth , d e n ta l, life, etc,) R e t i r e m e n t ( R e f e r t o P2 o f t h e D S - 4 0 9 6 d i r e c t i o n s ) Social Security Wo r k m e n s ' C o m p e n s a t i o n Un e m p l o y m e n t I n s u r a n c e R e f e r t o t h e M a r c h 2 4 , 1 9 8 2 memo o n " R e i m b u r s e m e n t f o r Un e mp l o y me n t C o s t s f o r S p e c i a l E d u c a t i o n P e r s o n n e l " f r o m E d w a r d L. B i r c h DATA PROCESSING. F o r ISO c e n t r a l r e g i s t r y u s e o n l y . Data p ro c e ss in g c o s t s r e l a t e d to I n s t r u c t i o n a l m a te r ia ls are reported under In stru c tio n a l function. If the d i s t r i c t operates I t s own c o m p u t e r p r o g r a m , a n a u d l t a b l e m e t h o d o f b i l l i n g m u s t be used. R e i m b u r s e m e n t I s l i m i t e d t o o p e r a t i o n a l c o s t s a n d may noc I n c lu d e p u r c h a s e o r replacem ent of equipment In t h e s e r v i c e c o s t . 3160 33 0 Salary Special e d u catio n approved perso n n el fu n ctio n in g as planners, c h ild fin d c o o r d in a to rs , compliance personnel S e c r e t a r y / C l e r i c a l f u l l time In s p e c i a l e d u c a t i o n Purchased S erv ices Other Purchased S erv ices S u p p l i e s , M a t e r i a l s and O th er S e r v i c e s O th er S u p p l i e s and M a t e r i a l s O th er Expenses M is c e lla n e o u s Expense ( T r a v e l f o r PAC, e t c . ) 0UTC0INC TRANSFER AND TRANSACTIONS c h e o n l y o u t g o i n g t r a n s f e r c h a t l a r e i m b u r s a b l e I s Che a d d e d c o s t o f t u i t i o n f o r s t u d e n t s e n r o l l e d a t t h a M i c h ig a n S c h o o l f o r che B l i n d and Michigan S ch oo l f o r t h e Deaf. T h e a d d e d c o s t r e i m b u r s e d on p a g e 3 , l i n e 4 7 o r 4 8 l a c a l c u l a t e d by t a k i n g t h e t o t a l t u i t i o n l a s a t h e membership. ( S e c t i o n 54 f u n d s a r e a s e p a r a t e a l l o c a t i o n a n d a r e noc used to c a l c u l a t e reimbursement under S ectio n 52). 8300 T uition for stu d en ts atten din g public school In another s t a t s . This l a r e s t r i c t e d by t h e S t a t e A i d A c t t o d i s t r i c t s C h a t b o r d e r Che other sta te . APPENDIX E DATA-COLLECTION FORM FOR SPECIAL EDUCATION PLANS 202 203 I n t e r m e d i a t e School D i s t r i c t S p e c i a l E d uc a ti o n M i l l a g e D i s t r i b u t i o n A n a l y s i s o f Methods I n cl ud e d in 1984-85 S p e c i a l E d u c a ti o n Plan ISD __________________________________________ Code Number __________ I n f o r m a t io n i n c l u d e d , page numbers _____________ Comments_______ A nalysis of Information Follows: 3 4 0 . 1 8 1 1 ( 2 ) , Comments: ______________ 3 ^ 0 . 1 8 1 1 ( 3 ) , Comments: ______________ 34 0. 1 8 1 1 (A ) , Comments: ______________ U t i l i z e s a l t e r n a t i v e me thod, Comments: Information provided c l e a r l y o r u n c le a r ly e x p la in s d i s t r i b u t i o n methods ( o p e r a t i o n a l l y i n t e r p r e t a b l e ) , Comments: ____________ A d d i t i o n a l comments: Key: Y = Yes, N = No, C = I n f o r m a t i o n C l e a r , I n f o r m a t i o n Un cl ea r APPENDIX F LETTER TO INTERMEDIATE SCHOOL DISTRICT DIRECTORS OF SPECIAL EDUCATION 20 h 205 M IC H IG A N STATE U N IV E R S IT Y COLIF.GF. Of RDl't.ATION OFPARTMFNT (H rol'NfiFIINC,. FDI'CATIONAL PSYCHOICK,V AND VFC.IAI FDI CATION FAST lANSINf, MICHIGAN A p r i l 3 0 , 1985 <«M H.M Dear A study is being conducted to learn the manner in which intermediate school district special education millage funds are distributed to constituent school districts. We are asking for help from you and other leaders in charge of special education at the intermediate school district level to acquire a necessary piece of information for the study. What we need is a copy of the forms used to compute the amount of a constituent school district's claim on your intermediate school district special education millage fund. Enclosed is a stamped and addressed envelope to simplify the method of response. The information will be received confidcntially and no individual intermediate school district will be identified in the report of the study or by any other disclosure. If you would like a copy of the abstract of the report, fill out and return the accompanying abstract request form and return in the same envelope as the material used to compute a constituent district's claim on the special education millage fund. The completion of the study is anticipated by the middle of this coming summer and the requested abstracts will he nailed shortly thereafter. We look forward with appreciation to receiving your response. Sincerely, Charles V. Mange, Professor Department of Counseling, Educational Psychology, and Special Education Tim Krug, Doctoral Candidate Department of Counseling, Educational Psychology, and Special Education jb cc: Dr. Edward L. Birch Enclosures VM isj n Afh+matifr A i t ion t i/ujl Opportunity Inxtitmtmn APPENDIX G ABSTRACT REQUEST FORM 206 207 ABSTRACT REQUEST FORM I f you would l i k e t o r e c e i v e an a b s t r a c t o f t h e s t u d y b ei n g c o nd uc te d c o n c e r n i n g t h e manner 1n which I n t e r m e d i a t e school d i s t r i c t s p e c i a l e d u c a t i o n m i l l a g e f u n d s a r e d i s t r i b u t e d t o c o n s t i t u e n t sch oo l d i s t r i c t s 1n Mich ig an, f i l l 1n t h e I n f o r m a t i o n below. NAME:. MAILING ADDRESS:. Re tu rn In t h e stamped and a d d r e s s e d e n v e l o p e p r o v i d e d , o r Mall t o : T1m Krug c / o Dr. C h a r l e s V. Mange D ep ar tm en t o f C o u n s e l i n g , E d u c a t i o n a l P s y c h o l o g y , and S p e c i a l E d u c a t i o n Michi gan S t a t e U n i v e r s i t y 343 E r i c k s o n Hall E a s t L a n s i n g , Michigan 48824 APPENDIX H DATA-COLLECTION FORM FOR INFORMATION RECEIVED FROM INTERMEDIATE SCHOOL DISTRICTS 208 209 Intermediate School District Special Education Millage Distribution Analysis of Methods Used in the 1984-85 School Year ISD_______________________________________________________ Code Number. iDf9C£D5ti9D Received (Y=Yes, N=No) __Received Form(s) and/or Other Material, Comments:_____________ ____ Phone Conversation, Person (s)___________________ Comments:_______________________________________ Follow Up Letterrluntl\ Im lttu tt"* APPENDIX K LETTER RECEIVED FROM MICHIGAN DEPARTMENT OF EDUCATION DESIGNEE 214 215 STATE OF MICHIGAN D EPA RTM EN T O F EDUCATION state board <* educate <* J ** Lansing. Michigan 4B909 N O R M AN O T T O ST(X K M F Y F R . SK Prcsuh-nt BARBARA D l'M O lU H F U F A ugust 7 , 1985 I h r I'rvsutrni BARHARA R O B ERTS M ASON P H IL L IP t R l'N k F L Supcnntcndcni o f Puh lu InM ruition Strn'tarv IX fR O T H Y Bl A R H M O R r tn v w ir v r |)R H r . T im K r u g , D o c t o r a l C a n d i d a t e D ep artm en t o f C o u n se lin g , E d u c a tio n a l P sy c h o lo g y , and S p e c ia l E d u c a tio n C o lle g e o f E ducatio n M ic h ig a n S t a t e U n i v e r s i t y E a s t L a n s in g , M ic h ig a n 48824-1034 ID M I N D I V A N D I T 1 I \ I SHI I h h x titf ( ARROI 1 M H I 'f IO N < TJ!K K Y JA C O B I'S ANNI I I A MM I I K (tO V JAM 1S J BLANC H A R D t» D e a r T im : The f o l lo w in g 1985, l e t t e r . is a response to the q u e s t i o n s t h a t yo u r a i s e d in your Ju ly 17, Q u estio n #1; W h a t c r i t e r i a a r e u s e d by t h e M i c h i g a n D e p a r t m e n t o f E d u c a t i o n t o a p p r o v e o r d i s a p p r o v e a n a l t e r n a t i v e m ethod f o r d i s t r i b u t i n g s p e c i a l e d u c a t i o n m i l l a g e f u n d s w h i c h h a s b e e n s u b m i t t e d f o r a p p r o v a l ( R 3 4 0 . 1811 ( 7 ) , a s p a r t o f a n i n t e r m e d ia t e sc h o o l d i s t r i c t s p e c i a l e d u c a tio n p lan ? 1. Any a l t e r n a t i v e m e t h o d s s u g g e s t e d u n d e r R 3 4 0 . 1 8 1 1 ( 7 ) o f t h e M i c h i g a n A d m i n i s t r a t i v e C od e f o r d i s t r i b u t i n g t h e I n t e r m e d i a t e d i s t r i c t s p e c i a l e d u c a t i o n m i l l a g e w o u l d , a s a m inim um , h a v e t o c o m p ly w i t h t h e f o l l o w i n g c rl teria. a. As s p e c i f i e d i n S e c t i o n 7 o f t h e r u l e , a n y a l t e r n a t i v e m e t h o d w o u l d h a v e t o be I n c l u d e d i n t h e I n t e r m e d i a t e p l a n . T h is r e q u i r e s a review by t h e P a r e n t A d v i s o r y C o m m i t t e e a n d a l l c o n s t i t u e n t d i s t r i c t s . b. As r e q u i r e d i n S e c t i o n 1 o f t h e r u l e , o n l y p r o g r a m s a n d s e r v i c e s a u t h o r i z e d i n th e i n t e r m e d i a t e d i s t r i c t p l a n and a p p r o v e d f o r r e im ­ b u r s e m e n t by t h e D e p a r t m e n t c a n b e r e i m b u r s e d u n d e r t h e a l t e r n a t i v e me t h o d . c. T h e e x p e n d i t u r e o f t h e f u n d s m u s t be c o n s i s t e n t w i t h S e c t i o n s 1722 t h r o u g h 1 7 29 o f t h e S c h o o l C o d e . T hese a r e the s e c t i o n s t h a t s p e c i f y t h e c o n d i t i o n s u n d e r w h i c h t h e i n t e r m e d i a t e m i l l a g e i s a p p r o v e d by t h e v o ters. T h i s s e c t i o n s p e c i f i c a l l y l i m i t s t h e f u n d s t o be u s e d f o r " t h e e d u c a t i o n o f h a n d i c a p p e d p e r s o n s ” a n d r e q u i r e s t h a t t h e f u n d s be used " f o r s p e c ia l e d u catio n purposes in accordance w ith r u le s p r o m u l g a t e d by t h e S t a t e B o a r d . " W i t h t h e e x c e p t i o n o f $ 1 2 , 5 0 0 , s p e c i f i c a l l y e x c lu d e d i n S e c t i o n 171 1 (2 ) o f the S c h o o l Code, th e d i s t r i b u t i o n o f f u n d s u n d e r a n a l t e r n a t i v e m e t h o d m u s t be c o n s i s t e n t w i t h R 340.1 8 0 2 th r o u g h R 340.1805 o f th e M ic h ig a n A d m i n i s t r a t i v e C ode. d. I f th e i n t e r m e d i a t e d i s t r i c t r e c e i v e s fu n d s u n d e r S e c t i o n 56 o f th e S t a t e S c h o o l A id A c t , t h e i n t e r m e d i a t e d i s t r i c t w o u l d be n o t i f i e d t h a t t h e f u n d s w o u l d h a v e t o be d i s t r i b u t e d on t h e a d d e d c o s t b a s i s o r t h e i n t e r m e d i a t e d i s t r i c t w ould j e o p a r d i z e r e c e i p t o f fu n d s u n d e r S e c t i o n 56. I h a v e a l r e a d y s h a r e d w i t h y o u I n f o r m a t i o n t h a t we c o l l e c t e d f ro m 216 T im K r u g Page 2 A ugust 7, 1965 d i s t r i c t s r e c e iv in g funds under S e c tio n d i s t r i b u t e d on an a d d e d c o s t b a s i s . e. 56 v e r i f y i n g th a t th e y w ere F i n a l l y , t h e a l t e r n a t i v e m e t h o d m u s t be f a i r a n d e q u i t a b l e t o a l l s c h o o l d i s t r i c t s c o n s i s t e n t w i t h th e I n t e n t o f R 3 4 0 .1 8 1 1 o f th e M ic h ig a n A d m i n i s t r a t i v e Code. Q u estio n t2: W h a t m o n i t o r i n g a c t i v i t i e s a r e u n d e r t a k e n by t h e M i c h i g a n D e p a r t m e n t o f E d u c a tio n to a s s u r e t h a t I n te r m e d ia te sc h o o l d i s t r i c t s a r e in co m p lian ce w ith M ic h ig a n S p e c i a l E d u c a tio n R u le s 340 .1 8 1 1 and 340.1812 w h ic h g o v e rn th e d i s t r i b u t i o n o f s p e c i a l e d u c a tio n m illa g e funds? S p e c i a l E d u c a tio n S e r v i c e s do es n o t " m o n ito r th e a p p l i e s t l o n ” o f R 3 4 0 .1 8 1 1 o r R 3 4 0 .1 8 1 2 . What th e D e p a r tm e n t d o e s I s r e v ie w an d a p p r o v e c o s ts th a t a re reim b u rsab le. T h e s e c o s t s t h e n becom e t h e b a s i s f o r t h e r e c e i p t o f s t a t e a id and th e b a s i s f o r the d i s t r i b u t i o n o f I n t e r m e d i a t e m illag e. R e m e m b e r, t h e c r i t e r i a f o r t h e d i s t r i b u t i o n o f I n t e r m e d i a t e m i l l a g e I n R 3 4 0 . 1 8 1 1 ( 1 ) a r e t h a t t h e m i l l a g e w i l l o n l y be u s e d f o r p r o g r a m s " a p p r o v e d f o r r e i m b u r s e m e n t by t h e D e p a r t m e n t , " T h e s e c r i t e r i a a p p l y t o th e d i s t r i b u t i o n o f a l l m il l a g e , i n c lu d in g m illa g e t h a t i s d i s t r i b u t e d u n d e r th e o p t i o n a l c r i t e r i a found in R 3 4 0 .1 8 1 1 (7 ). T h e r e I s g e n e r a l l y no n e e d f o r th e D e p a rtm e n t o f E d u c a ti o n to m o n ito r the i m p le m e n ta tio n o f t h i s r u l e s i n c e th e r e s p o n s i b i l i t y f o r a c c o u n tin g f o r the d i s t r i b u t i o n o f fu n d s by s t a t u t e r e s t s w i t h th e i n t e r m e d i a t e b o ard o f e d u c a t i o n . T he I n t e r m e d i a t e b o a r d , a s I n d i c a t e d In P a r t 7 o f the S c h o o l C ode, has r e s p o n s i b i l i t y f o r th e m a in te n a n c e and c o n t r o l o f fu n d s c o n s i s t e n t w i t h the law . S e c t i o n 622 o f t h e S c h o o l Cod e r e q u i r e s t h e I n t e r m e d i a t e b o a r d t o s e t u p a s e t o f a c c o u n t s a p p r o v e d by t h e S t a t e B o a r d a n d t o h a v e I t s b o o k s a u d ite d a n n u ally . U nder th e s u p e r v i s i o n and c o n t r o l p r o v i s i o n s ( S e c t i o n 6 1 1 ) , the I n t e r m e d i a t e b o a rd l a r e s p o n s i b l e f o r th e o v e r a l l o p e r a t i o n and e x p e n d i t u r e o f f u n d s c o n s i s t e n t w i t h s t a t e law a n d r u l e s . The i n t e r m e d i a t e s u p e r i n t e n d e n t , a s th e c h i e f e x e c u tiv e o f f i c e r , I s r e s p o n s i b l e to th e b o a r d f o r th e a d m i n i s t r a t i o n o f funds a s p a r t o f the p e rfo rm a n c e o f d u t i e s r e q u i r e d u n d e r S e c t i o n 153. I n t e r m e d i a t e d i s t r i c t s su b m it to th e D e p a rtm e n t o f E d u c a tio n a copy o f th e ir au d it. D e p a r tm e n t S e r v i c e s r e v ie w s e a c h a u d i t ; and i f t h e r e a r e any f i n d i n g s t h a t I n d i c a t e d i s c r e p a n c i e s In d i s t r i b u t i o n o f fu n d s r e l a t e d to s p e c i a l e d u c a tio n , th e s e a r e forw arded to our o f f i c e f o r re v ie w . These n o r m a l ly d e a l w i t h d i s c r e p a n c i e s and d i s t r i b u t i o n o f f e d e r a l f u n d s . It and are The the I s th e r e s p o n s i b i l i t y o f th e i n t e r m e d ia t e d i s t r i c t bo ard o f e d u c a tio n th e s u p e r i n t e n d e n t a s t h e i r e x e c u t i v e o f f i c e r to a s s u r e t h a t th e fu n d s d i s t r i b u t e d I n a c c o r d a n c e w i t h r u l e s p r o m u l g a t e d by t h e D e p a r t m e n t . D e p a r tm e n t a p p r o v e s th e c o s t s f o r w h ic h fu n d s can be d i s t r i b u t e d and s c h o o l d i s t r i c t a u d i t o r s h o u l d be t e s t i n g t h e e x p e n d i t u r e o f f u n d s 217 T i n Krug Page 3 A ugust 7, 19 85 a c c o r d in g to th o se c o s t s . I f th e re I s a c o m p la in t, th e D ep artm en t can I n v e s t i g a t e u n d er s p e c i a l e d u c a tio n r u l e s and can c o m p le te a f i s c a l a u d i t u n d e r S e c t i o n R 3 8 0 .1 2 8 1 o f th e S c h o o l Code. A t t a c h e d i s a c o p y o f t h e S e p t e m b e r 1 9 , 1 9 8 4 , mem oran dum s e n t t o d i s t r i c t s d e s c r i b i n g a d d i t i o n a l c o n s t r a i n t s added to S e c t i o n 5 1 ( 3 ) ( e ) o f th e S t a t e S c h o o l A id A c t. S in cerely , l a x t e r , T>h^). , S u p e r l v l s o r M a n a g e m enn tt I n f o r m a t i o n a n d F il n a n coe S p e c ia l E d u catio n S e r v ic e s JMB: sk E n clo su re cc: E d w a rd B i r c h C h a r l e s Mange 218 STATE OF MICHIGAN f ; ' ■>, DEPARTM ENT O F EDUCATION •T A T I M A ftO OP EDUCATION OR. G U M E C IN D O SA LA S P re sid e n t L an sin g M ich igan 4 8 9 0 9 JO H N W A T A N E N . JR V u e P re sid e n t S e p te m b e r 19, 1984 P H IL L IP K. R t'N K K I A N N ETTA M IL L E R S e c re ta ry DR. E D M U N D F. V A N D ETTE S u p c rm le m lc n i ol P ii M ic ln slm t.in * n T re a su re r M E MO R A HD1IM C A R R O LL M. H UTTON N A S B L D e le g a te BARBARA O U M O U C H E L L E BARBARA R O B ERTS M ASON NORM AN O TTO S T O C K M EY ER . SR L o cal and I n t e r m e d i a t e D i s t r i c t B u s in e s s M anagers and S p e c ia l E d u catio n D ire c to rs TO GOV. JA M ES J B LA N C H A R D ti-O lfir m J ip e rv ls o r, S p e c ia l E ducatio n S e rv ic e s u p e r v l s o r , D ep artm en t S e r v ic e s FROM J a n M. B a x t R o b e rt N els SUBJECTs Q u e s t i o n s and A nsw ers R e g a r d in g C hanges I n t h e S t a t e S c h o o l A id A c t R e l a t i n g to S p e c i a l E d u c a ti o n Program s and S e r v i c e s f o r 1984-85 S ch o o l Year Q u estio n 1 C an a d i s t r i c t w h ich d o e s n o t r e c e i v e m em b ersh ip u n d e r S e c t i o n 21 o f t h e S t a t e A id A c t ( c o m m o n ly r e f e r r e d t o a s a n o u t - o f - f o r m u l a d i s t r i c t ) r e c e i v e m e m b e r s h i p f o r s p e c ia l ed u catio n p u p ils? Ans we r Yes. An o u t - o f - f o r m u l a d i s t r i c t may r e c e i v e m e m b e r s h i p f o r t h e f o l l o w i n g c a te g o r ie s of s p e c ia l e d u c a tio n stu d e n ts : a) stu d e n ts In s p e c ia l ed u catio n c e n te r p r o g r a m s , b ) h a n d i c a p p e d s t u d e n t s who q u a l i f y f o r S e c t i o n 5 3 , a n d c ) c o u r t p l a c e d s t u d e n t s who q u a l i f y u n d e r S e c t i o n 2 4 o f t h e S t a t e A i d A c t . Q u estio n 2 W hat I s a c e n t e r p rogram ? Ans we r A c e n t e r p ro g ram a s d e f i n e d I n S e c t i o n 6 ( 1 ) o f th e S t a t e S c h o o l A id A c t I s a program f o r th e a u t i s t l c a l l y I m p a ire d , t r a i n a b l e m e n ta lly Im p a ire d , s e v e r e ly m e n ta lly Im p a ire d , s e v e re ly m u ltip ly Im p a ire d , h e a rin g Im p a ire d , p h y s i c a l l y and o t h e r h e a l t h im p a ire d , v i s u a l l y Im p a ire d , a s w e l l a s program s f o r th e e m o tio n a lly I m p a i r e d t h a t a r e h o u s e d i n b u i l d i n g s t h a t do n o t s e r v e r e g u l a r e d u c a t i o n p u p i l s . F o r th e s e pro g ram to q u a l i f y , they m u st b e : a ) I d e n t i f i e d a s a c e n t e r program In th e I n te r m e d ia te d i s t r i c t s p e c i a l e d u c a tio n p la n and b ) s e rv e a l l of th e d l s t r l c t a w i t h i n t h e I n t e r m e d i a t e o r s e r v e p u p i l s from t h r e e o r more d i s t r i c t s w i t h l e s s t h a n 50% o f t h e p u p i l s b e i n g r e s i d e n t s o f t h e o p e r a t i n g d i s t r i c t . Q u estio n 3 The S t a t e A id A c t a l l o w s t h e D e p a r t m e n t o f E d u c a t i o n t o a p p r o v e p r o g r a m s t h a t h a v e m o r e t h a n 50% o f t h e p u p i l s c o m i n g f r o m t h e r e s i d e n t d i s t r i c t a s c e n t e r p r o g r a m s . What i s th e c r i t e r i a and p r o c e d u r e f o r o b t a i n i n g t h i s a p p r o v a l ? 1 219 Answer I f a d i s t r i c t d o e s n o t s e r v e a l l t h e c o n s t i t u e n t d i s t r i c t s a n d s o r e t h a n SOX o f p u p i l s c o n e f r o m t h e r e s i d e n t d i s t r i c t , t h e d i s t r i c t o u s t h a v e a w a i v e r t o be c l a s s i f i e d a s a " c e n te r p ro g ram ." th e T o q u a l i f y , d i s t r i c t s o u s t v e r i f y t h a t t h e p r o g r a m w as e s t a b l i s h e d t o o e e t t h e n e e d s o f h a n d ic a p p e d s t u d e n t s from o t h e r d i s t r i c t s and I t l a o n ly c o i n c i d e n t a l t h a t s t o r e t h a n SOX o f t h e s t u d e n t s r e s i d e I n t h e o p e r a t i n g d i s t r i c t . V e rific a tio n n ig h t i n c l u d e h i s t o r y o f I n t e r m e d i a t e s c h o o l d i s t r i c t r e g i o n a l i z a t i o n , d a t a f r o s t tw o o r m o r e c o n s e c u t i v e p r i o r y e a r s s h o w i n g t h e p r o g r a m a t o n e t i m e s e r v e d l e s s t h a n 50X re s id e n t stu d e n ts, e tc . A p p l i c a t i o n i s by l e t t e r t o t h e S t a t e D i r e c t o r o f S p e c i a l E d u c a t i o n . m ust c o n ta in th e fo llo w in g In fo rm a tio n f o r each classroom : a) b) The l e t t e r The d i s a b i l i t y c a te g o r y o r c a t e g o r i e s q u a l i f y i n g th e program a s a c e n t e r p r o g r a m a s d e f i n e d i n S e c t i o n 6 ( 1 ) o f t h e S t a t e A id A c t ( r e f e r to Q u e s t i o n 2), The b u l l d l n g ( s ) w here e a c h program I s l o c a t e d . c) A copy of ap p ro v in g th e s e c t i o n o f th e I n t e r m e d i a t e D i s t r i c t S p e c i a l E d u c a tio n P la n th e program to o p e r a t e f o r s e v e r a l d i s t r i c t s . d) A l i s t s h o w i n g t h e d i s t r i c t s s e r v e d , t h e t o t a l h e a d c o u n t , FTE I n s p e c i a l e d u c a t i o n a n d FTE i n r e g u l a r e d u c a t i o n f o r e a c h p r o g r a m . (T h e D S -4061 work s h e e t c a n be u s e d t o m e e t t h i s r e q u i r e m e n t by a d d i n g t h e d i s t r i c t o f r e s i d e n c e a f t e r th e s t u d e n t ' s nam e.) e) A l e t t e r f r o m t h e I n t e r m e d i a t e s c h o o l d i s t r i c t v e r i f y i n g t h a t t h e p r o g r a m w as d e s i g n e d and h as been o p e r a t e d to m eet th e n e e d s of a t l e a s t t h r e e o t h e r d i s t r i c t s , snd In th e o p in io n o f th e I n t e r m e d i a t e d i s t r i c t I t I s o n ly c o i n c i ­ d e n t a l t h a t m ore t h a n 50% o f t h e s t u d e n t s r e s i d e I n t h e o p e r a t i n g d i s t r i c t . Q u estio n 4 How w i l l d i s t r i c t s a n o th er d is tr ic t? c a lc u la te the t u i t i o n when th e y a r e s e r v i n g a s t u d e n t from A nswer S e c t i o n 5 1 ( 3 ) ( e ) a l o n g w i t h R 3 4 0 . 1 8 0 6 o f t h e M i c h i g a n A d m i n i s t r a t i v e Code o u t l i n e s t h e c o n d i t i o n s a n d c r i t e r i a f o r c h a r g i n g t u i t i o n f o r s t u d e n t s i n S e c t i o n 52 p ro g ram s o r p ro g ram s funded u n d e r P .L . 9 4 -1 4 2 . R e fe r to th e a tt a c h e d c h a r t f o r a sum m ery o f t h e i n f o r m a t i o n o n t u i t i o n . Q u estio n 5 T h e l e g i s l a t u r e s e t a s i d e $ 3 9 0 , 0 0 0 I n S e c t i o n 55 o f t h e S t a t e A i d A c t f o r a p r o g r a m d e v e l o p e d by t h e D e p a r t m e n t f o r p u p i l s who h a v e a c o m m u n i c a t i o n I m p a i r m e n t . W h at I s t h e p u r p o s e , w h a t c a n f u n d s b e u s e d f o r a n d how c a n d i s t r i c t s a p p l y 7 2 220 Answer The p u r p o s e I s to p r o v id e fu n d s f o r th e p u r c h a s e o f e q u ip m e n t d e s ig n e d f o r p e r s o n a w ith com m unication d i s o r d e r s o r to c o v e r th e c o s t o f t e s t i n g I n d i v id u a ls f o r th e d e t e r m i n a t i o n of a need f o r eq u ip m e n t d e s ig n e d f o r I n d i v i d u a l s w i t h a com m unication Im pairm ent. F u n d s c a n be u s e d f o r t h e p u r c h a s e o f s p e c i a l l y d e s i g n e d c o m m u n i c a t i o n e q u i p m e n t n o t o r d in a r ily a v a ila b le In the s p e c ia l e d u c a tio n classro o m . T h is In clu d es s p e c i a l l y d e s i g n e d o r m o d i f i e d e q u ip m e n t u s e d to h e l p Im prove r e a d i n g , w r i t i n g , s p e a k in g and h e a r in g , o r o th e rw is e en h an ce c o m m u n icatio n s. I t w ould I n c l u d e s i m u l a t e d l a n g u a g e d e v i c e s , a n d s p e c i a l l y d e s i g n e d low v i s i o n r e a d i n g a i d s n o t g en erally a v a ila b le . I t w ould n o t I n c l u d e s t a n d a r d t a l k i n g c a l c u l a t o r s , b l i s s b o a r d s , F .H . t r a n s m i t t e r s o r e l e c t r i c t y p e w r i t e r s u n l e s s th ey have b e e n s p e c i a l l y d esig n ed o r ad ap ted f o r an I n d iv id u a l s p e c ia l e d u c a tio n s tu d e n t( s ) w ith a com m unication Im p airm en t. F u n d s may a l s o b e u s e d t o p a y f o r t e s t i n g o f I n d i v i d u a l s p e c i a l e d u c a t i o n s t u d e n t s w here th e t e s t i n g I s to d e te r m in e th e need f o r an d a b i l i t y to u se s p e c i a l l y d e s ig n e d co m m u n icatio n e q u ip m e n t. Funds a r e n o t a v a i l a b l e u n d e r t h i s s e c t i o n f o r t e s t i n g t h a t I s o r d i n a r i l y p r o v i d e d (MET e v a l u a t i o n s , t h r e e y ear re -e v a lu a tio n s , e tc .) . Funds a r e r e s t r i c t e d to p u rc h a s e of eq u ip m e n t and f e e s f o r t e s t i n g . Funds a r e n o t a v a i l a b l e u n d e r t h i s s e c t i o n f o r em ploym ent o f s t a f f , p r o f e s s i o n a l d e v e lo p m e n t, eq u ip m en t r e p a i r , e t c . G r a n t a p p l i c a t i o n s w i l l be d e v e l o p e d a n d f o r w a r d e d t o a l l l o c a l a n d I n t e r m e d i a t e school d is tr ic ts . F u n d s w i l l be a v a i l a b l e f o r u p t o 100% o f t h e d i r e c t c o s t o f eq u ip m en t o r t e s t i n g . R e i m b u r s e m e n t w i l l be p r o r a t e d I f a p p r o v e d a p p l i c a t i o n s exceed th e am ount of funds a v a i l a b l e . E x p e n s e s i n c l u d e d I n a n a p p r o v e d g r a n t may n o t b e I n c l u d e d f o r r e i m b u r s e m e n t u n d e r o th e r f e d e r a l o r s t a t e fu nding program s. The a p p l i c a n t w i l l have to i d e n t i f y th e m o d el, m a n u f a c t u r e r , an d s p e c i f i c c o s t of eq u ip m en t. I f the eq u ip m en t I s d e s ig n e d and m a n u f a c tu re d o u t s i d e th e S t a t e of M i c h ig a n , th e a p p l i c a n t w i l l have t o c e r t i f y t h a t n o v e n d o r c o u l d be fo u n d t o p r o v i d e s i m i l a r e q u i p m e n t w i t h i n t h e sa m e p r i c e r a n g e d e s i g n e d a n d m a n u f a c t u r e d I n M ic h ig a n . E q u i p m e n t m u s t be f o r e d u c a t i o n a l u s e , s p e c i f i c a l l y r e l a t e d t o h e l p i n g th e s t u d e n t a c h ie v e le a r n in g o b j e c t i v e s I d e n t i f i e d In th e IE P , and I s r e s t r i c t e d to use w ith s p e c ia l ed u catio n s tu d e n ts . Q u es t l o n 6 S e c t i o n 57 h a s b e e n a d d e d o u t-o f-fo rm u la d i s t r i c t s . c a l c u l a ted? to th e S t a t e A id A c t an d p r o v i d e s c a t e g o r i c a l fu n d s f o r Who q u a l i f i e s f o r t h e p r o g r a m a n d how w i l l f u n d i n g b e Answer S t u d e n t s I n S e c t i o n 52 a n d P . L . 9 4 - 1 4 2 p r o g r a m s f o r t h e e d u c a b l e m e n t a l l y I m p a i r e d , le a r n i n g d i s a b le d , p re p rim a ry Im p a ire d , c la s sro o m program s f o r s e v e r e ly language Im p a ire d , a s w e ll a s e m o tio n a lly im p aire d s t u d e n ts housed I n b u ild in g s s e rv in g r e g u l a r e d u c a t i o n p u p i l s who a r e r e s i d e n t s o f o u t - o f - f o r m u l a d i s t r i c t s w i l l q u a l i f y to re c e iv e c a te g o r ic a l a id under t h is s e c tio n . Funds a r e n o t a v a i l a b l e f o r s t u d e n t s f r o m ou t - o f - f o r m u l a d i s t r i c t s who r e c e i v e d m e m b e r s h i p t h r o u g h c e n t e r p r o g r a m s , o r who q u a l i f y f o r S e c t i o n 2 4 o r S e c t i o n 5 3 . 3 221 T h e s e f u n d s w i l l be c l a i m e d by t h e o p e r s t i n g d i s t r i c t . T here I s a l i m i t on the n u m b e r o f s t u d e n t s who q u a l i f y f o r a i d u n d e r t h i s s e c t i o n . The o p e r a t i n g d i s t r i c t c a n n o t c l a i m more s t u d e n t s fro m o u t - o f - f o r m u l a d i s t r i c t s t h a n w ere s e r v e d u n d e r th e a b o v e named c a t e g o r i e s f o r t h e 1 9 8 3 -8 4 s c h o o l y e a r . T h is In c lu d e s th e number o f s t u d e n t s who a r e r e s i d e n t s o f ou t - o f - f o r m u l a d i s t r i c t s who w e r e c o u n t e d i n t h e f o l l o w i n g c a t e g o r i e s ; a ) s t u d e n t s who w e r e a t t e n d i n g l n - f o r n u l a d i s t r i c t o r I n t e r m e d i a t e d i s t r i c t p r o g r a m s t h e p r e v i o u s y e a r who w e r e c o u n t e d by t h e o p e r a t i n g d i s t r i c t f o r m e m b e r s h i p , o r b ) s t u d e n t s who w e r e a t t e n d i n g P . L . 9 4 - 1 4 2 o r S e c t i o n 52 c e n t e r p ro g ra m s I n t h e a b o v e d e s i g n a t e d c a t e g o r i e s . The am ount o f fu n d s to be a l l o c a t e d u n d e r S e c t i o n 57 w i l l be 85Z o f t h e p e r p u p i l m e m b e r s h i p a i d g r o s s a l l o w a n c e com puted u n d e r S e c t i o n 2 1 ( 1 ) o r S e c t i o n 5 1 ( 3 ) ( d ) f o r t h e d i s t r i c t o r I n t e r m e d ia te d i s t r i c t t h a t w i l l p ro v id e th e program s. Ques t l o n 7 The f o u r t h F r i d a y c o u n t form (D S -4061) r e q u i r e s d i s t r i c t s to s l l o c a t e m em bership to s t u d e n ts r e c e iv in g s p e c i a l e d u c a tio n t e a c h e r c o n s u l ta n t s e r v ic e s and i n s t r u c t i o n a l s e r v i c e s to p re p rlm a ry age c h i l d r e n . W ill th e s e s tu d e n ts q u a lif y f o r reim bursem ent u n d e r S e c t i o n 577 A nsw er Yes. Q u estio n 8 S e c t i o n 21 w s s a m e n d e d t o a l l o w a n a d d i t i o n a l $ 28 I n m e m b e r s h i p f o r d i s t r i c t s m eet th e s p e c i f i e d program r e q u ir e m e n ts . W i l l t h i s $ 2 8 be I n c l u d e d I n t h e a w m b e r s h l p a i d g r o s s a l l o w a n c e w hen c a l c u l a t i n g t h e i n t e r m e d i a t e d i s t r i c t m em bership f i g u r e ? A nsw er Y es. 4 th a t CALCULATING TUITION FOR SPECIAL EDUCATION SECTION 52 STUDENTS FOR THE 1984-85 SCHOOL YEAR : DISTRICT OF : RESIDENCE : IN FORMULA : : OPERATING DISTRICT - NON CENTER PROGRAMS IN FORMULA : OUT OF FORMULA : INTERMEDIATE ( P e r p u p i l c o s t , m i n u s : P e r p u p i l c o s t , m inus : ope r a t i n g d i s t r i c t : c a t e g o r l c a l a i d , m inus :g ro ss p er p u p il : a n y ISD r e i m b u r s e m e n t : : m em bers h i p , m i n u s :an d f e d e r a l a i d . :c a te g o rlc a l a id ,* : : m i n u s a n y ISD :The d i s t r i c t o f : re im b u rs e m e n t & any : resid en ce w il l c o ll e c t :fe d e ra l a id .* * : th e m em bership. : t : :R ef. S e c .5 1 ( 3 ) ( e ) ( ll) :R e f . : : : : : CENTER PROGRAMS ALL DISTRICTS ! : P e r p u p i l c o s t , m i n u s : P e r p u p i l c o s t , m in u s{ {o p eratin g d i s t r i c t o r: ISD g r o s s p e r p u p i l m em b e rsh ip , m inus :I S D g r o s s p e r p u p i l { cate g o rical aid , (m em bership, m inus : m i n u s a n y ISD { cate g o rical a id , : ( m i n u s a n y ISD o r { reim b u rsem en t o r (fed eral a id . : federal aid . { ( : P e r p u p i l c o s t , m i n u s : P e r p u p i l c o s t , m inus :c a teg o rlcal a id , tc a te g o rlc a l aid , : m i n u s a n y ISD : m l n u a a n y ISD sOUT OF FORMULA : : r e i m b u r s e m e n t o r {reim b u rsem en t o r {federal a id . {federal a id . { { { { { { { { i s {R ef. S e c . 5 1 ( 3 ) ( e ) ( 1 1 ) (R e f. S e c . 5 1 ( 3 ) ( e ) ( l l ) (R ef. S e c .5 1 (3 )(d ) { { ( : ( P e r p u p i l c o s t , m in u s { P e r p u p i l c o s t , m lnus( ca teg o rica l aid , (o p e ra tin g d i s t r i c t o r: m i n u s a n y ISD :ISD g r o s s p e r p u p i l : ■m e m b e r s h i p , m i n u s : reim b u rsem en t o r federal aid . { c a te g o rical a id , : : m l n u s a n y ISD o r : {federal a id . : : ( : : R e f . S e c . 5 1 ( 3 ) ( e ) ( l l l ) :R e f. S e c .5 1 ( 3 ) ( d ) : : : s R ef. S e c . 5 1 ( 3 ) ( e ) ( i i ) :: : :____________ y __________________ :___________________ s__________________ ::_________________ i NOTE: * ** C a te g o r ic a l a id In clu d es S e c tio n 52, 55, and 57 funds re c eiv ed by the op era tin g d i s t r i c t . F ed era l funds must be deducted under p r o v is io n s of S e c tio n 5 1 (1 ), S e c tio n 5 1 (2 ) , and S a ctlo n 5 1 (3 )(b ) S p e c ia l E ducation S e r v ic e s , A ugust 1984 222 : (and S e c . I l l S e c .5 1 (3 )(e )(l) APPENDIX L MICHIGAN DEPARTMENT OF EDUCATION LISTING OF REQUIREMENTS FOR THE REVIEW OF INTERMEDIATE SCHOOL DISTRICT SPECIAL EDUCATION PLANS 223 Ilk R e v ise d : 5/83 MICHIGAN DEPARTMENT OF EDUCATION S p e c ia l E d u catio n S e rv ic e s Form at f o r R e v ie w in g 1984-85 I n t e r m e d i a t e P la n a f o r th e D e l i v e r y o f S p e c i a l E d u c a tio n Program s and S e r v i c e s INTERMEDIATE SCHOOL DISTRICT : D istric t # D ate S u b m itte d : NAME OF INTERMEDIATE CONTACT PERSON: T IT L E : PHONE: Y N Needed P r i o r Do y o u a u s p e c t t h i s P l a n w i l l b e u n d e r o b j e c t i o n ? to R e v ie w : 1. E ndorsem ent p a g e s c o n t a i n i n g o r i g i n a l ( o r n o ta r iz e d copy) of: sig n a tu re s w ith d ates* Y N a. ISD S u p e r i n t e n d e n t ( I n d i c a t e s a p p r o v a l ) Y N b. S u p e r in te n d e n t of each C o n s t i t u e n t D i s t r i c t ( I n d i c a t e s In v o lv em en t) Y N c. PAC C h a i r p e r s o n ( I n d i c a t e s Y N 2. C o py o f t h e a t t a c h e d " P l a n F o r m a t ” l i s t i n g P l e a s e r e t u r n one copy t o th e D e p a r tm e n t. Y N 3. Two c o p i e s o f ♦NOTE: Involvem ent) oage nu m b ers. th e P la n . Unda t e d s i g n a t u r e s f o r e i t h e r t h e o r i g i n a l P lan o r f o r m o d ific a tio n s a re n o t ac c e p ta b le . 225 ISD P art 1 C om p reh en siv e S p e c i a l E d u c a tio n P rogram s an d S e r v i c e s S ectio n Page # 1.1 P rocedural Safeguards D e s c r i b e any p r o c e d u r a l s a f e g u a r d s In te rm e d ia te school d i s t r i c t to : C r i t e r i a Met ( S t a t e Uae) r e q u i r e d by t h e (1) Insure c o n fid e n tia lity In fo rm s t l o n . of p e r s o n a lly Id en tifiab le (2) P ro v id e p a r e n t n o tic e and se c u re w r i t t e n c o n s e n t b e fo re p r e p la c e m e n t e v a l u a t i o n o r p la c e m e n t o f a h an d icap p ed stu d e n t. Y N Y N ____ Y __ _N (3) A d v is e a n d In fo rm h a n d ic a p p e d p e r s o n s , t h e i r p a r e n t s , and o t h e r members o f t h e com m unity a s t o t h e s p e c i a l e d u c a t i o n o p p o r t u n i t i e s r e q u i r e d u n d e r t h e law ; th e o b l i g a t i o n s of t h e l o c a l a n d I n t e r m e d i a t e s c h o o l d i s t r i c t a n d t h e name, a d d r e s s , and te le p h o n e num ber o f r e p r e s e n t a t i v e s o f b o th t h e l o c a l an d I n t e r m e d i a t e s c h o o l d i s t r i c t s w here I n f o r m a t i o n c a n be o b t a i n e d . (A ) Inform p a r e n ts of t h e i r r i g h t to o b ta in an In d ep en d en t e d u c a t i o n a l e v a l u a t i o n a n d due p r o c e s s h e a r i n g . Y N (5) A dvise p a r e n t s Y N Y N S e c tio n 1.2 of th e c o m p la in t p r o c e s s . P u b l i c A w areness D e s c r i b e a c t i v i t i e s an d o u t r e a c h m ethods w hich a r e u se d to I n s u r e t h a t a l l c i t i z e n s a r e aw are of th e a v a i l a b i l i t y of s p e c i a l e d u c a t i o n program s and s e r v i c e s . S ectio n 1.3 R eferral S ystem D e s c r i b e a n y p r o c e d u r e s r e q u i r e d by t h e I n t e r m e d i a t e s c h o o l d i s t r i c t f o r p r o c e s s i n g a n d r e p o r t i n g r e f e r r a l s f o r p e r s o n s u p to 25 y e a r s o f a g e known t o b e , o r s u s p e c t e d o f b e i n g , h a n d i c a p p e d . S ectio n 1 .4 D ia g n o stic S e rv ic e s D e s c rib e th e tyoe and am ount o f d i a g n o s ti c s e r v i c e s t h a t a r e d i r e c t l y o p e r a te d w i t h i n th e I n t e r m e d i a t e s c h o o l d i s t r i c t . D escrib e th o se d ia g n o s tic s e rv ic e s p urchased o r c o n tra c te d from o u t s i d e t h e I n t e r m e d i a t e s c h o o l d i s t r i c t . S ectio n 1.5 Y for Y N Y N Y N Y N In d iv id u a liz e d E d u catio n al P lan n in g C om m ittee P ro c e d u re (1) D e scrib e th e p ro ced u re f o r r e g is te r in g e l i g i b l e w ith the I n te rm e d ia te c e n tr a l r e g i s t r y . (2) D e s c r i b e a n y p r o c e d u r e s r e q u i r e d by t h e I n t e r m e d i a t e s c h o o l d i s t r i c t fo r: ( 2) stu d e n ts 226 ISD________________________________ C r i t e r i a Met ( S t a t e Use) (a) D eterm in in g s tu d e n t e l i g i b i l i t y , m ent of h a n d ic a p p e d s t u d e n t s , Y N (b) C o n d u c tin g and a d m i n i s t e r i n g th e I n d i v id u a li z e d t l o n a l p la n n in g co m m ittee m e e tin g . Y N Y N to meet Y H D e s c rib e any a d d i t i o n a l program s o r s e r v i c e s , I n c lu d in g summer s c h o o l p r o g r a m s , work a c t i v i t y c e n t e r s , s o e c l a l l z e d p r o g ra m s , n u r s i n g homes, s t a t e h o s p i t a l s and m e n ta l h e a l t h Y M Y N S ectio n (1) 1 .6 p rogram s and p l a c e - C ontinuum o f S p e c i a l E d u c a t io n P ro g ram s and S erv ices D e s c rib e th e s p e c i a l se rv ices. ed u catio n b asic program s and s u p o o r t l v e D e s c rib e th e v o c a tio n a l t r a i n i n g orogram s d esig n ed the e d u c a tio n a l needs o f handicapped p e rs o n s . (2) educa- and c h i l d c a r e f a c i l i t i e s . (3) L i s t th e c o n s t i t u e n t d i s t r i c t s t h a t have been ap p ro v ed to g r a d u a t e h a n d i c a p p e d p e r s o n s who a r e s o l m o a l r e d t h a t t h e y c an n o t c o m p le te th e r e g u l a r e d u c a tio n program . S e c t i o n 1,7 Com m unity I n t e g r a t i o n a n d F o llo w - U p (1) D e s c rib e th e p r o c e d u r e used t o a s s u r e I n t e g r a t i o n of each h a n d i c a p p e d p e r s o n i n t o t h e s c h o o l a n d t h e com m unity en v l ronm ent. Y ii (2) D e s c r i b e t h e m e a n s by w h i c h t h e l o c a l s c h o o l d i s t r i c t a n d th e I n te rm e d ia te sc h o o l d i s t r i c t s h a ll d eterm in e the e f f e c t i v e n e s s o f s p e c i a l e d u c a tio n program s and s e r v i c e s Y N Y N Y N Y N Y N and t h e e d u c a t i o n a l p l a n f o r each han d i c a p p e d p e r s o n . The f o l l o w - u p sy s t e m s h a l l I n c l u d e a p r o c e d u r e f o r d e t e r m i n i n g t h e school-communl ty a d j u s t m e n t s o f han d i ca p p e d p e r s o n s f o r a t l e a s t one y e a r f o l l o w i n g t e r m i n a t i o n of t h e i r s D e c l a l e d u c a t i o n programs and s e r v i c e s . P art 2 M anagement o f S p e c i a l S e c tio n 2 .1 E d u c a tio n P rogram s and S e r v i c e s A d m in istratio n of P rogram s and S e r v ic e s (1) I d e n t i f y t h e d i s t r i c t a d m i n i s t r a t o r who I s r e s p o n s i b l e f o r th e Im p le m e n ta tio n of s p e c i a l e d u c a tio n pro g ram s and s e r v i c e s . (2) D e sc rib e any a d m i n i s t r a t i v e p ro c e d u re in te rm e d ia te school d i s t r i c t fo r: req u estin g r e q u i r e d by d e v ia tio n s, p ro cessin g o b je c tio n s d i s t r i c t p lan , In v estig atin g to th e in te rm e d ia te c o m p lain ts. (3) school the 227 ts n C r i t e r i a Met (S ta t e U s e ) S e c tio n 2 .2 Q u alified P ersonnel (1) E s t i m a t e t h e t y p e o f p r o f e s s i o n a l a n d oa n o r o f e s s l o n a 1 p e r s o n n e l need ed t o p ro v id e th e s p e c i a l e d u c a tio n program s and s e r v i c e s d e s c rib e d In S e c tio n 1 .6 . (2) D e s c r i b e t h e p r o c e d u r e s r e q u i r e d by t h e I n t e r m e d i a t e s c h o o l d i s t r i c t f o r d e te r m in in g th e p r o f e s s i o n a l dev elo p m en t needs o f s p e c i a l e d u c a t i o n and g e n e r a l e d u c a t i o n s t a f f and th e p la n s f o r m eetin g th ese n eed s. Y N D escrib e your q u a l i f ic a t i o n s Y N Y N Y N Y N Y M Y N Y _N_ S e c tio n 2 .3 F a c ilitie s f o r o a rs Dr o f e s s lo n a 1 p e r s o n n e l . (1) M and T r a n s p o r t a t i o n D e s c r i b e th e ty p e of f a c i l i t i e s and th e t r a n s p o r t a t i o n n e c e s s a r y to p r o v id e th e s p e c i a l e d u c a tio n urogram s and s e r v i c e s d e s c r i b e d In S e c tio n 1 .6 . S e c tio n 2 .6 Y I n s t r u c t i o n a l C ontent D e s c r i b e p r o c e d u r e s t o be u s e d b y t h e I n t e r m e d i a t e d i s t r i c t f o r a p p ro v a l of I n s t r u c t i o n a l c o n te n t of s p e c ia l e d u c a tio n programs and s e r v i c e s . (2) T h e I n s t r u c t i o n a l c o n t e n t s h a l l , a t a minim um I n c l u d e p e r s o n a l a d j u s tm e n t , prevoca t l o n a l an d v o c a t i o n a l t r a i n i n g , and p h y sic al ed u catio n . S e c tio n 2 .5 M o n ito rin g and E v a lu a tio n D e s c r i b e th e m eth o d , t i m e t a b l e and c r i t e r i a f o r m o n i t o r i n g and e v a l u a t i n g s t a t e I n s t i t u t i o n s and o u b llc sc h o o l s p e c i a l e d u c a tio n program s and s e r v i c e s w ith in th e I n t e r m e d i a t e sc h o o l d i s t r i c t . S e c tio n 2 .6 F e d e r a l Funds D escrib e f o r each a n tic ip a te d g ra n t o r e n title m e n t of fe d e ra l m onies th e am ount an d so u rc e of th e f u n d s , th e a n t i c i p a t e d manner I n w h i c h I t s h a l l be u t i l i z e d a n d t h e p r o c e s s o f how s u c h f u n d s w i l l b e d i s t r i b u t e d t o , o r on b e h a l f o f , l o c a l s c h o o l d i s t r i c t . Such d e s c r i p t i o n s h a l l s p e c i f i c a l l y I n c l u d e why the d i s t r i b u t i o n p l a n n e d i s deemed to be e q u i t a b l e and r e p r e s e n t a t i v e of the r e s p e c t i v e p o p u l a t i o n of handica pped s t u d e n t s In each of the l o c a l districts. P a rt 3. P a r e n t A d v is o ry C om m ittee S e c tio n 3 .1 O rg a n iz a tio n a l S tru c tu r e of Comml t t e e th e P a r e n t A dvisory D e s c r i b e t h e o r g a n i z a t i o n a l s t r u c t u r e of the Committee, I n c l u d i n g o f f i c e r s and t h e i r r e s p o n s i b i l i t i e s , meet ing t i me s , n o t i c e t h e r e o f , v o t i n g p r o c e d u r e s , terms of o f f i c e and r e l a t e d m a t t e r s . (6) 228 isn______________________________ C r i t e r i a Met ( S t a t e Uae) S ectio n 3.2 RoLe a n d R e s p o n s i b i l i t y Comml t t e e of th e P a r e n t A d v iso ry (1) D e s c rib e th e r o l e and r e s p o n s i b i l i t y of th e C o m m ittee, I n c l u d i n g how i t s h a l l p a r t i c i p a t e i n t h e c o o p e r a t i v e d ev elo p m en t of th e c la n , fo rm u la te o b j e c t i o n s t h e r e t o , i f a n y , and such r e l a t e d m a t t e r s as th e r o l e and r e a p o n s l b l l l t y o f th e P a r e n t A d v is o r y Com m ittee i n e v a l u a t i n g s o e c l a l e d u c a tio n o rogram s and s e r v i c e s w i t h i n th e i n t e r m e d ia t e d istric t. Y N (2) D e s c rib e th e r o l e and r e l a t i o n s h i p o f a d m i n i s t r a t i v e and o th e r school p e rso n n e l, as w ell as r e p re s e n ts tlv e s of o th e r a g e n c i e s , i n a s s i s t i n g t h e C om m ittee i n i t s r e s p o n s i b i l i t i e s . Y M Y N S ectio n 3 .3 A d m in istrativ e Comml t t e e Support of th e P a r e n t A d v iso ry D e s c r i b e th e f i s c a l a n d s t a f f r e s o u r c e s t h a t s h a l l be s e c u r e d o r a l l o c a t e d t o t h e C o m m i t t e e by t h e i n t e r m e d i a t e s c h o o l d i s t r i c t i n o r d e r t o make i t e f f i c i e n t a n d e f f e c t i v e i n o p e r a t i o n . F o r MDE C o m p l e t i o n : ISD # i ____________________________ D a t e R e c ' d : ________________ __________________Recom mended f o r A p p r o v a l __________________R e t u r n e d ( s e e i t e m s c h e c k e d No a b o v e . By:___________________________________________________ D a (5) t e : __________________________________ REFERENCES REFERENCES B a x t e r , J . M. (1985, J u l y ) . Notes from d i s c u s s i o n c o n c e r n i n g I n t e r ­ mediate sp ecia l ed ucation m illa g e . U np ubl ish ed I n t e r v i e w n o t e s , L a n s i n g , MI. B e r n s t e i n , C. D., H a r t m a n , W. T.» K1 r s t , M. W., & M a r s h a l l , R. S. (1976). F i n a n c i n g e d u c a t i o n a l s e r v i c e s f o r t h e ha n d i ca p p ed ; An a n a l y s i s o i c u r r e n t r e s e a r c h md practices. Reston, VA: Council f o r Exceptional Children. B i r c h , E. L. (1984, O ct o b er ) . Memorandum ± c s t a t e s p e c i a l e d u c a t i o n a d v i s o r y ggjpflilltse* s u b j e c t ; Michigan .department e f e d ucat lftD/ s p e c i a l e d u c a t i o n s e r v i c e s r e p o r t . M ich ig an D e p a r tm e n t o f Educa­ tion. C a e s a r , G. (1974, O ct o be r) . 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Unpub­ l i s h e d I n t e r v i e w n o t e s , Michigan S t a t e U n i v e r s i t y . M cL ure , W. P., B u r n h a m , R. A., 4 H e n d e r s o n , R. A. ( 1 9 7 5 ) . S p e d a l e d u c a t i o n : Needs, c o s t s , methods M f i n a n c i n g . Urbana: Bureau o f E d u c a t i o n a l R e s ea r c h , C o l l e g e of E d u c a t i o n , U n i v e r s i t y o f I l l i n o i s a t Urbana-Champalgn. McLure, W. P. (1975, November). U n i t s u p p o r t f u n d i n g £ f s p e c i a l e d u c a t i o n . P ap er p r e s e n t e d a t t h e F i f t h Annual I n v i t a t i o n a l Con­ f e r e n c e on L e a d e r s h i p 1n S p e c i a l E d u c a t i o n P ro g ram s, M i n n e a p o l i s , MN. Michigan D e p a r tm e n t of E d uc a tio n . (1968). Michi gan s p e c i a l e d u c a t i o n f i n a n c e co m m it te e: f i n a l r e p o r t . L a n s i n g : Michigan Dep art me nt o f E d u c a ti o n . Michigan D e p a r tm e n t o f E du ca tio n. (1972). P r e l i m i n a r y s t a t e p l a n f o r i h £ Im p l e m e n t a ti o n f i f L A , 1 2 £ Ctf 12 2 1 . Mich iga n S t a t e Board o f Ed u ca ti o n . (1984, May). F i n a n c i a l and program e f f e c t s £ f s t a t e a i d ch an ge s e f f e c t i v e ±0 1284rS5. £Q l o c a l and I n t e r m e d i a t e school d i s t r i c t s . L a n s i n g : Michigan S t a t e Board o f E d u c a ti o n . Michigan S t a t e Board o f Ed u ca ti o n . XU-1S5. (1977). Michigan s p e c i a l e d u c a t i o n Michigan S t a t e Board o f Ed u ca ti o n . rules. (1980). Michigan s p e c i a l e d u c a t i o n Michigan S t a t e Board o f Ed u ca ti o n . ■tmlfiS. (1982). Michigan s p e c i a l e d u c a t i o n 232 Michi gan S t a t e Board o f Edu ca tio n . (1985). S p e c i a l e d u c a t i o n a d m i n i s ­ t r a t i v e manual* volume H * f i n a n c e . La ns in g: Michigan D e p a r tm e n t o f E d uc a tio n . R ev i se d 1985. Py ec h a* J . N., K u l 1 g o w s k 1 , B. A.* & W1eger1nk» R. ( 1 9 8 4 ) . An e x p l o r a ­ t i o n s lf i s s u e s r e g a r d i n g e d u c a t i o n c o s t s and funding t r e n d s and their relation io ±he p r o v i s i o n nf spenlal e du c a t i o n and r e l a t e d s e r v i c e s . Research T r i a n g l e Park* NC: R es ear ch T r i ­ a n g le I n s t i t u t e C enter f o r Educational Studies. Roe* W. H.» G1dd1s* W. J . , & N i e l s e n , E. (1 96 3) F i n a n c i n g Mi c h i g a n ’ s s c h o o l s ( 3 rd ed.* re v . ) . E a s t L a n s i n g : Michigan S t a t e U n i v e r s i t y * C o l l e g e o f Education* Bureau o f E d u c a t i o n a l Research. S t a t e o f Michigan. (1954). Act No. 18, P u b l i c A cts o f 1954. Re g ul ar S e s s i o n o f 1954. S t a t e o f Michigan. (1955). Act No. 269* P u b l i c Acts o f 1955. Re g ul ar S e s s i o n o f 1955. S t a t e o f M i c h i g a n . ( 1 9 5 5 ) . Act No. 4 , Publ 1c A c t s o f 1 95 5 . 1955 F1 r s t Extra Session. S t a t e of Michigan. (1958). Act No. 120* P u b l i c Acts o f 1958. R eg ul ar S e s s i o n o f 1958. S t a t e o f Michigan. (1962). Act No. 190* P u b l i c Acts o f 1962. R eg u l ar S e s s i o n o f 1962. S t a t e o f Michigan. (1963). Act No. 77, P u b l i c Acts o f 1963. Re g ul ar S e s s i o n o f 1963. S t a t e o f Michigan. (1963). Act No. 191* P u b l i c Acts o f 1963. R eg u l ar S e s s i o n o f 1963. S t a t e of Michigan. (1963). Act No. 120, P u b l i c Acts o f 1963. Regu la r S e s s i o n o f 1963. S t a t e o f Michigan. (1964). Act No. 246, P u b l i c Acts o f 1964. Regu la r S e s s i o n o f 1964. S t a t e o f Michigan. (1968). Act No. 320* P u b l i c Acts o f 1968. Re gu la r S e s s i o n o f 1968. S t a t e of Michigan. (1969). Act No. 19* P u b l i c A cts o f 1969. Re g ul ar S e s s i o n o f 1969. S t a t e o f Michigan. (1971). Act No. 198, P u b l i c Acts o f 1971. R eg ul ar S e s s i o n o f 1976. 233 S t a t e o f Michigan. (1973). Act No. 10 1, P u b l i c A ct s o f 1973. R eg ul ar S e s s i o n o f 1973. S t a t e o f Michigan. (1975). Act No. 2 61 , P u b l i c A cts o f 1755. R eg ul ar S e s s i o n o f 1975. S t a t e o f M i c h i g a n . ( 1 9 7 6 ) . Act No. 4 5 1 , Publ 1c A c t s o f 1 97 6 . 7 8 t h L e g i s l a t u r e . R e g u l a r S e s s i o n o f 1976. S t a t e of Michigan. (1963). C o n s t i t u t i o n A r tic l e 8, Section 2. ihs State £ f M ic hi ga n . Task Forc e on S p e c i a l E d u c a ti o n . (1977, J u l y ) . Mandatory s p e c i a l educa­ tion M ichigan: a s s e s s m e n t a n d rec o m m en d at io n s . A R e p o r t o f t h e Ad Hoc Task Force on S p e c i a l Ed u ca ti o n . Lans in g: Michi gan D e p a r t ­ ment of E d u c a ti o n . Thomas, J. A. (1968). School f i n a n c e and e d u c a t i o n a l o p p o r t u n i t y i n M ic h ig an . L a n s i n g : Michigan D epartment o f E d u c a t i o n .