November 18, 2021

A new MOE — Maintenance of Equity

LEAs that receive and spend federal funds are familiar with the term “maintenance of effort,” which is known by its acronym, MOE. Specifically, LEAs see the term “MOE” come into play for special education funds and federal funds allocated under the umbrella of the Every Student Succeeds Act (ESSA).

The advent of one-time stimulus funds has brought an influx of funds, as well as additional compliance requirements. The latest compliance requirement comes in the form of a new MOE—Maintenance of Equity (MOEquity). The MOEquity requires compliance and reporting for both the state and LEAs. By December 31 of each year the following data must be reported by the state:

  • Whether or not an LEA is exempt from MOEquity requirements during that year
  • If an LEA is not exempt:
    • Which schools within each LEA are identified as high-poverty schools as defined in MOEquity guidance and section 2004(d)(4) of the American Rescue Plan (ARP) Act
    • Per-pupil funding for each high-poverty school in the LEA in the fiscal years (FYs) 2021, 2022, 2023, as applicable for the year in which the data is published
    • Per-pupil amount of funding in the aggregate for all schools in the LEA for FYs 2021, 2022, and 2023, as applicable for the year in which the data is published
    • Per-pupil full-time equivalent (FTE) staff for each high-poverty school in the LEA in FYs 2021, 2022, and 2023, as applicable for the year in which the data is published
    • Per-pupil number of FTE staff in the aggregate for all schools in the LEA in FYs 2021, 2022, and 2023, as applicable for the year in which the data is published
    • Whether an LEA did not maintain equity for any high-poverty school in FY 2022 or 2023
  • If an LEA maintains equity by grade span, the data above may be reported by grade span
  • The State Educational Agency must ensure the data reported is accurate and consistent with the requirements in section 2004(c) of the ARP

In order for LEAs to comply with the MOEquity provision, LEAs shall not:

  • Reduce per-pupil funding (combined state and local funding) for any high-poverty school at a rate that exceeds the total reduction in LEA funding (from combined state and local funding) for all schools served by the LEA in such fiscal year (if any) divided by the number of children enrolled in all schools served by the LEA in such fiscal year
  • Reduce per-pupil FTE staff in any high-poverty school by an amount that exceeds the total reduction in FTE staff in all schools in such fiscal year (if any) divided by the number of children enrolled in all schools served by the LEA in such fiscal year

Not all LEAs are subject to the MOEquity provision. LEAs that meet any one of the following conditions are excluded:

  • LEA has a total enrollment of less than 1,000 students
  • LEA operates a single school
  • LEA serves all students within each grade span with a single school
  • LEA demonstrates an exceptional or uncontrollable circumstance, such as unpredictable changes in student enrollment or a precipitous decline in the financial resources of such agency, as determined by the Secretary of Education

The requirements noted above are proposed at this time by the United States Department of Education (ED) as it is currently parsing through public comments. We will keep you apprised of the final requirements, once approved, as well as operational considerations based on the final requirements.

The full proposed requirements can be found here, while the most recent Frequently Asked Questions (FAQ) from the ED can be found here.