Wednesday, September 23, 2015

CCAE: At Attempt at Clarity to Avoid Audit Exceptions & Penalties

From CCAE Legislative Analyst Dawn Koepke:
An Attempt at Clarity to Avoid Audit Exceptions & Penalties

We've heard from across the state that you all are working earnestly to implement the new era of adult education; however, you've also shared questions and concerns about the details of moving forward.  I believe we can all agree that the Adult Ed Block Grant provides such great opportunity and yet it is filled with provisions that, arguably, seem to lack clarity or sufficient level of detail.  As with any law or budget passed, we must always consider the intent that led to the details of the policy and budget for clues about how to address such perceived lack of clarity.  We worked hard and were at the front lines of developing the policy framework that led us to this point, so let's revisit what we believe to be true based on those discussions in an effort to provide some clarity on some of the biggest issues/questions we've heard to date.

Hit the link to learn more.

FAQ #1:            Will the Adult Education Block Grant be audited this year and how do I avoid an audit exception and penalties?
CDE has the authority to audit adult schools and their expenditures.  In order to avoid an audit exception and penalties, it is important that adult schools operate in line with the intent of AB 104 and the Adult Education Block Grant.  We've offered the following additional FAQs in an effort to help provide additional clarity on some of the key provisions under the Adult Education Block Grant.
FAQ #2:            Can LCFF funds be used for adult education?
LCFF does not prohibit the use of LCFF funds for adult education - allocation of LCFF funds are at the discretion of the school district.  That said and as you know the structure of LCFF focuses on the K-12 student, given the funding thresholds to be achieved per student under the framework school districts will inevitably look to use most of the funds for K-12 purposes in order to meet the goals and standards under LCFF.  Nevertheless, adult schools should continue to push for inclusion in its district's LCAP based on parent engagement, concurrent enrollment and other programs offered by an adult school that can and does provide value to the district's K-12 priorities.
FAQ #3:            Does the Adult Education Block Grant require a local fiscal agent?
Consortia should make their own decisions locally about whether to have a local fiscal agent or to rely on the funding to come through CDE and the school district.  As your state representatives, we want to be sure you know that there should be no concern with exercising this flexibility we worked so hard to obtain.  
FAQ #4:            Will consortia decisions to not have a local fiscal agent impact how quickly they receive funding?
While it has been characterized that lack of a local fiscal agent may result in adult schools not receiving their funding quickly, the timing should not be an issue.  To be clear, the language in AB 104 provides that the Superintendent and Chancellor must approve a schedule of allocations to consortia by October 30th with the requirement to apportion the funds to a local fiscal agent, if designated, no more than 30 days later.  For a consortium that has not designated a local fiscal agent, the Superintendent and Chancellor are required to apportion the funds no more than 30 days after receipt of a final distribution schedule from the consortium.  This only means that consortia that elect not to have a local fiscal agent will need to move quickly to finalize their local apportionment schedules so as to indicate how much the Superintendent and Chancellor should apportion to each member, which in theory could be done one day after the state apportionment numbers are finalized and submitted that day with the 30 day clock running the same schedule as a consortium with a local fiscal agent.  Presuming consortia without a local fiscal agent move quickly to finalize their local apportionment schedules, there should be no delay in receipt of funds.
FAQ #5:            Does the Adult Ed Block Grant allow for adult schools to serve concurrent, under 18 years of age students?
Nothing in AB 104 prohibits an adult school from serving students under 18 years of age.  That said, it is our interpretation based on the language of AB 104 and intent of the Department of Finance and Legislature that Adult Education Block Grant funding should be used only for adults - students 18 years or older.  For students served by adult schools who are under age 18, LCFF dollars should be sought to help cover the costs of instruction for these students.  With regard to the validity of such credits, it is our understanding that such a determination is an individual school district issue.  To the extent that a local school district accepts the credits obtained through an adult school credit recovery program funded with LCFF dollars for the purpose of a high school diploma, then the diploma should be accepted by other programs as well.
FAQ #6:            Can adult schools continue to charge fees for ESL and citizenship classes?
Although AB 189 (2011) provided fee authority for adult schools to charge fees for classes in ESL and citizenship, the caveat was that it was a time-limited authority that expired as of July 2015.  Going forward, there is no longer the authority for adult schools to charge fees for these classes.  While CCAE and CAEAA attempted to have bill language introduced that would have reinstated the fee authority until such time as the broader fee policy is established for adult education, there was unfortunately no willingness to entertain the extension of the fee authority.   Instead, we will need to work with our consortia to access the funds over and above the maintenance of capacity funding to help fill the gap.  
                        It should also be noted that AB 189 never provided authority for adult schools to charge fees for basic skills and adult secondary classes and that still remains true today.
FAQ #7:            What does the 5% administrative cap entail, allow and/or prohibit?
Recall AB 104 included language as follows:
Education Code Section 84913
                                    (b)  A consortium may use no more than 5 percent of funds allocated in a given fiscal year for the sum of the following:
     (1)  The costs of administration of these programs.
     (2)  The costs of the consortium.
While we supported an administrative cap being placed on consortia related activities, we were concerned with the lack of clarity regarding this language in that it would seemingly place the same cap on costs associated with adult schools delivering programs.  A strict interpretation of the cap would unquestionably devastate most adult schools and hinder the ability to deliver programs that ensure the best outcomes.  Based on conversations with legislative staff and the intent of the Department of Finance, they seem to be comfortable with the general approach CDE and the Chancellor's office are proposing that would not include the following items under the cap:
-       Salaries and benefits (for all staff and a consortium facilitator/staff person)  
-       Maintenance and custodial supplies    
-       Instructional Support including materials, supplies, technology and equipment    
-       Services including contracts, professional development, marketing and outreach, internships and externships
Legislative staff suggests moving forward with the understanding that these items are outside the cap and would be allowable.  Should there be a need to adjust the language or provide further clarity the Legislature is open to doing so in future legislative and/or budget activities.
If you have questions or concerns regarding this content, please contact CCAE via membership    at or CAEAA via bharper    at  Thank you!



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