§ 300.162 Supplementation of State, local, and other Federal funds.

Plain English summary

This section governs how states must manage and expend federal IDEA Part B funds. States must keep these funds separate from state funds using a distinct accounting system with an audit trail, and may not use federal funds to replace (supplant) existing federal, state, or local special education funding. A waiver of the nonsupplanting requirement is available if the state provides clear and convincing evidence that all children with disabilities have FAPE available.

Key requirements

• Funds paid to a State under this part must be expended in accordance with all the provisions of this part.
• Funds paid to a State under this part must not be commingled with State funds.
• The requirement against commingling is satisfied by the use of a separate accounting system that includes an audit trail of the expenditure of funds paid to a State under this part.
• Separate bank accounts are not required.
• Funds paid to a State under Part B of the Act must be used to supplement the level of Federal, State, and local funds expended for special education and related services provided to children with disabilities under Part B of the Act, and in no case to supplant those Federal, State, and local funds.
• If the State provides clear and convincing evidence that all children with disabilities have available to them FAPE, the Secretary may waive, in whole or in part, the requirements of paragraph (c)(1) of this section if the Secretary concurs with the evidence provided by the State under § 300.164.

Affected parties

• State Educational Agencies (SEAs)
• Local Educational Agencies (LEAs)
• U.S. Secretary of Education
• Office of Management and Budget

Official source

https://www.ecfr.gov/current/title-34/part-300/section-300.162