Special Education: Grant Programs Designed to Serve Children Ages
0-5 (25-APR-02, GAO-02-394).					 
                                                                 
In fiscal year 2001, the federal government spent $7 billion on  
the following three special education grant programs: Special	 
Education Grants to States (School-age Grants), Special Education
Grants Preschool (Preschool Grants) and Special Education Grants 
for Infants and Families with Disabilities (Infants Grants).	 
School-age and Preschool Grants are similar, except for the age  
ranges served, while Infant Grants differ in goals, performance  
objectives, performance measures, eligibility, and services. The 
key distinction between School-Age and Preschool Grants is that  
School-age Grants serve children ages three through 21, whereas  
Preschool Grants serve only children ages three through five.	 
States receive funds from all three grants, and some states	 
report they use both School-age and Preschool funds to provide	 
the same range of services to children aged three through five.  
Although states receive funds from all three grants, local	 
agencies may receive funds from only one grant, or from all	 
three. Eighteen of the 19 states GAO reviewed reported that the  
range of services they provide to children ages three through	 
five is the same as those they provide with Preschool Grants.	 
Evaluations show that half the children who received preschool	 
services (mainly speech and language therapy) no longer needed	 
them on reaching school age. Consolidating the two grants would  
eliminate coordination problems, but it is unclear whether	 
program efficiency would increase. At the federal level,	 
Education is already administering School-age and Preschool	 
Grants as one program. State and local officials said that	 
consolidation would not significantly reduce administrative	 
burden. 							 
-------------------------Indexing Terms------------------------- 
REPORTNUM:   GAO-02-394 					        
    ACCNO:   A02932						        
  TITLE:     Special Education: Grant Programs Designed to Serve      
Children Ages 0-5						 
     DATE:   04/25/2002 
  SUBJECT:   Educational grants 				 
	     Preschoolers					 
	     Special education					 
	     Children with disabilities 			 
	     Aid for the disabled				 
	     Performance measures				 
	     Eligibility criteria				 
	     Program evaluation 				 
	     Elementary school students 			 
	     Special Education Grants for Infants and		 
	     Families with Disabilities 			 
                                                                 
	     Special Education Grants to States 		 
	     Special Education Preschool Grants 		 

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GAO-02-394
     
United States General Accounting Office

GAO Report to the Ranking Minority Member, Subcommittee on Oversight of
Government Management, Restructuring and the District of Columbia, U.S.
Senate Committee on Government Affairs

April 2002

SPECIAL EDUCATION

Grant Programs Designed to Serve Children Ages 0 - 5

GAO-02-394

Contents

Letter

Results in Brief
Background
School-Age and Preschool Grants Are Similar Except for Age

Range Served; Infant Grants Differ States Receive All Grants and Many
Provide Services to 3 through 5 Year-Olds with School-Age as well as
Preschool Grants Grants' Impact Not Yet Evaluated, and Few Data Are
Available on

Effectiveness of Special Education Programs for Young Children Some Local
Coordination and Program Overlap Issues Exist Concluding Observations Agency
Comments and Our Response

                                     1

                                    3 5

                                     7

10

11 13 18 18

Appendix GAO Contacts and Staff Acknowledgments 20

GAO Contacts 20 Staff Acknowledgments 20

Related GAO Products

Tables

Table 1: Overview of Three Programs Serving Young Children with
Disabilities, Fiscal Year 2001

Table 2: Overview of Eligibility Criteria, Services Allowed, Goals and
Performance Objectives for Infant, Preschool, and School-age Grants for
Children with Disabilities

Table 3: Advantages and Disadvantages of Options for Addressing Potential
Overlap of Preschool and School-age Grants 6

8 16

Figure

Figure 1: Special Education Funding Sources 5

Abbreviations

IDEA Individuals with Disabilities Education Act
LEA local educational agencies
OSEP Office of Special Education Programs
SEA state educational agency

United States General Accounting Office Washington, DC 20548

April 25, 2002

The Honorable George V. Voinovich

Ranking Minority Member

Subcommittee on Oversight of Government Management, Restructuring and the
District of Columbia Committee on Governmental Affairs United States Senate

Dear Senator Voinovich:

In fiscal year 2001, the federal government spent about $7 billion on three
special education grant programs mandated by the Individuals with
Disabilities Education Act (IDEA). These grants are Special Education Grants
to States (School-age Grants), Special Education Preschool Grants (Preschool
Grants) and Special Education Grants for Infants and Families with
Disabilities (Infant Grants). This review is one of four reports you have
requested looking at overlap among early childhood education and care
programs.1 Our work has shown that if such programs are designed to achieve
similar outcomes for the same target group and are not well-coordinated, the
potential exists for ineffective service delivery and administrative
inefficiencies.2 This potential exists for School-age Grants and Preschool
Grants because School-age Grants serve children ages 3 through 21 and
Preschool Grants serve children ages 3 through 5.

These three grant programs are not programs in the typical sense because
they do not carry out a distinct set of functions through their own delivery
systems. Instead, the programs serve as funding streams, merging with much
greater state and local resources to support state and local programs. State
and local programs supported by the three grants served

1See: U.S. General Accounting Office, Early Education and Care: Overlap
Indicates Need to Assess Crosscutting Programs, GAO/HEHS-00-78 (Washington,
D.C.: Apr. 28, 2000); Bilingual Education: Four Overlapping Programs Could
Be Consolidated, GAO-01-657 (Washington, D.C.: May 14, 2001); and Head Start
and Even Start: Greater Collaboration Needed on Measures of Adult Education
and Literacy, GAO-02-348 (Washington, D.C.: Mar. 29, 2002).

2U.S. General Accounting Office, Managing for Results: Using the Results Act
to Address Mission Fragmentation and Program Overlap, GAO/AIMD-97-146
(Washington, D.C.: Aug. 29, 1997).

approximately 6.6 million children in fiscal year 2001. Of these children,
about 830,000 were receiving early intervention and special education and
related services-231,000 were under 3 years-old and 599,000 were age 3
through 5.

Specifically, you asked us: (1) How similar are the goals/objectives,
performance measures, eligibility criteria, and the services allowed by
these programs? (2) Do states and local agencies receive funding from more
than one of these grants and, if so, do they use the funds to provide the
same range of services to children in the same age group? (3) What is known
about the effectiveness of these programs and of the early interventions
they fund? (4) What opportunities exist for better coordination among the
programs or consolidation of the programs to achieve efficiencies?

To answer these questions, we reviewed pertinent documents, including state
monitoring reports issued by the U.S. Department of Education's (Education)
Office of Special Education Programs (OSEP), which provided detailed
information about state and local efforts to implement IDEA.3 We examined
the grant application process and administrative structure for each grant
program, conducted interviews with special education program officials and
representatives from special education stakeholder groups (parents and state
directors of special education), conducted comprehensive state-level
interviews in four states-Maine, Minnesota, Ohio, and Virginia-and conducted
structured telephone interviews with officials from 15 states.4 We selected
the four states for comprehensive interviews based, in part, on
recommendations from state-level officials and others with a direct interest
in these programs. We also considered variations in how states administer
these programs and selected states that represented a variety of
administrative structures and geographic regions. For the telephone
interviews, we selected at least 1 state from each of Education's 10
regions. In order to obtain a wide range of perspectives on program
administration, we also considered which state agency had been designated to
administer Infant Grants. We

3Each year, OSEP monitors the implementation of IDEA in selected states. We
reviewed the latest reports, published in 2001 (monitoring reports for
Colorado, Florida, Louisiana, Maryland, New York, New Jersey, and Ohio) and
2000 (monitoring reports for Arizona, Arkansas, Massachusetts, Montana,
Nebraska, and Wisconsin). We also reviewed older reports for Maine,
Minnesota and Virginia.

4Alaska, Arkansas, Arizona, California, Colorado, Delaware, Florida,
Illinois, Nebraska, New Hampshire, New Jersey, New York, Oklahoma,
Pennsylvania, and Rhode Island.

Results in Brief

performed our work from June 2001 through February 2002 in accordance with
generally accepted government auditing standards.

School-age and Preschool Grants are similar, except for the age ranges of
children they serve, while Infant Grants differ from the other two grants in
goals, performance objectives, performance measures, eligibility, and
services. School-age and Preschool Grants share the common goal of helping
states provide access to high-quality education for students with
disabilities and use a single set of performance objectives and performance
measures to measure progress towards this goal. Both grants pay for the same
range of special education and related services and require that children
must be classified by the state as having a disability in order to be
eligible for these services. The key distinction between the two grants is
that School-age Grants serve children ages 3 through 21, whereas Preschool
Grants generally serve children ages 3 through 5. In contrast, the goal of
Infant Grants is to help states provide a comprehensive system of early
intervention services to infants, toddlers, and their families to enhance
the development of infants and toddlers with disabilities and those who are
at risk of developmental delays. Infant Grants may be used to pay for health
and family services, such as tube feeding and respite care, that are more
comprehensive than those provided under the other two grants, and for
additional services to families that will enhance their capacity to meet the
special needs of their infants and toddlers. To be eligible for services
under Infant Grants, children must be under age 3 and have a developmental
delay or the potential to develop one.

States receive funds from all three grants, and some states reported they
use funds from both School-age and Preschool Grants to provide the same
range of services to children aged 3 through 5. Although states receive
funds from all three grants, local agencies may receive funds from only one
grant, or from as many as three. Overlap can occur only between School-age
Grants and Preschool Grants, which fund the same range of services for
children ages 3 through 5. Eighteen of the 19 states we talked with reported
that the range of services they provide to children ages 3 through 5 using
funds from School-age Grants, such as counseling, speech pathology services,
and physical therapy, is the same as those they provide using funds from
Preschool Grants. None of these states could tell us how much of their
School-age Grants they use to pay for services for children ages 3 through
5, and federal regulations do not require them to report this information.
In general, states could not provide us with this information because they
account for expenditures by budget function, such as

salaries or transportation, and not by individual services provided or ages
of children receiving services.

Little is known about the long-term effectiveness of these programs and the
early childhood interventions they fund. No evaluations of these programs
have been conducted that attempt to isolate the impact of these three
federal grant programs from the impact of other funding sources. Education
has three large studies under way that will have some information on the
outcomes for children who are enrolled in special education preschool
programs, but not on these programs' specific contributions to these
outcomes. In addition, two state evaluations that we reviewed described
positive outcomes for children who participated in preschool special
education programs but could not attribute these outcomes solely to program
participation. These evaluations show that about half the children who
received preschool services (mainly speech and language therapy) no longer
needed them when they reached school age.

We found some opportunities for better coordination of these grant programs,
but program officials told us that consolidating School-age and Preschool
Grants would not result in additional administrative efficiencies. The lack
of coordination that we did find existed at the state and local level in
situations where a child turned 3 before the school year began, causing a
gap between the services provided with Infant Grants and those provided with
School-age and Preschool Grants. This occurred despite federal rules that
allow funds from Infant Grants to be used after the third birthday to pay
for a free appropriate public education until the beginning of the following
school year and required written plans for each child, to show how the
transition between the two programs will be managed. We were unable to
determine whether the overlap in age groups served by School-age and
Preschool Grants indicates poor coordination, because most of the states and
localities that we contacted do not track the sources of funds for services
for specific ages of children. Although consolidating these two grants would
eliminate the potential for poor coordination between two separate grants by
eliminating one of them, it is not clear that this would result in increased
program efficiency. At the federal level, Education is already administering
School-age and Preschool Grants as if they were one program. State and local
officials indicated that although there are potential advantages and
disadvantages to consolidating the programs, overall, consolidation would
probably not result in a significant reduction in administrative burden.

Background The 50 states and the District of Columbia spent an estimated $50
billion on special education for children from birth through age 21 in
school year 1999-00. About 12 percent of this amount came from federal
funds, specifically IDEA grants (10 percent) and Medicaid funds (2
percent).5 (See fig. 1.) In addition to federal funds, other sources are
used to support the provision of special education and related services for
children with disabilities, such as state general and special education
funds, local funds, and private insurance.

Figure 1: Special Education Funding Sources

School-age grants Preschool grants Medicaid

Source: Chambers, Jay G., et al., What Are We Spending on Special Education
Services in the United States, 1999-2000? Advance Report #1, Special
Education Expenditure Project (SEEP), American Institutes for Research,
2002.

Under IDEA, three grants can fund services to children under age 6.
School-age Grants provide money to states to help them serve all eligible
children, ranging in age from 3 through 21.6 Preschool Grants provide money
to states to help serve 3 through 5-year-olds with disabilities and

5Chambers, Jay G., et al., What Are We Spending on Special Education
Services in the United States, 1999-2000? Advance Report #1, Special
Education Expenditure Project (SEEP) (Palo Alto, CA: American Institutes for
Research, 2002). This amount does not include other possible federal funding
sources for special education such as Title I of the Elementary and
Secondary Education Act, Head Start, Developmental Disabilities Grants, and
Special Education Grants for Infants and Families.

6However, states are not required to serve children with disabilities ages 3
through 5 or 18 through 21 if these services are not consistent with state
law or practice or the order of any court.

require states to have policies and procedures that assure a free
appropriate public education for all 3 through 5-year-olds with disabilities
as a condition for receiving other IDEA funds for this age range. Infant
Grants provide money to states to serve children under age 3 who have
developmental delays or a condition that will probably result in a
developmental delay, or at a state's discretion, who are otherwise at risk
of developmental delays.7 Unlike the other two grants, Infant Grants provide
services to both children and their families, primarily in settings that are
not school-based. (See table 1.)

       Table 1: Overview of Three Programs Serving Young Children with
                       Disabilities, Fiscal Year 2001

Programa

FY 2001 appropriation Number of children served Comments

School-age $6.3 billion Established in 1965 under the Elementary and Grants
Secondary Education Act and State Schools Act.
5,782,000 ages 6 through 21 599,000 ages 3 through 5b Established in 1975 as
an incentive program to

     Preschool Grants $390 million encourage states to serve 3 through 5
                                 year-olds.

Infant $384 million  231,000 Established in 1986, but not implemented in all

Grants states until 1994.

aSchool-age and Preschool Grants are authorized under IDEA Part B and are
formally known as Section 611 grants and Section 619 grants, respectively.
Infant Grants are authorized under IDEA Part C.

bThis includes children served under both School-age and Preschool Grants.

Source: GAO analysis.

Program overlap occurs when programs have the same goals, the same
activities or strategies to achieve them, or the same targeted recipients.
As noted in a House Government Reform and Oversight Committee report, "A
certain amount of redundancy is understandable and can be beneficial if it
occurs by design as part of a management strategy to foster competition,
provide better service delivery to customer groups, or provide emergency
backup." 8 Because both School-age and Preschool grants can be used to serve
the same target recipients, children with disabilities ages 3 through 5,
they can be characterized as overlapping. However, this overlap does

7Currently 9 states-California, Hawaii, Indiana, Massachusetts, Nevada, New
Hampshire, New Mexico, North Carolina and West Virginia-serve children whom
they consider to be at risk. The precise definition of "at-risk" varies by
state.

8H. Rpt. No. 104-861, p. 6.

not necessarily lead to duplication of services, which involves providing
identical services to identical target groups.9

Education allocates funds from School-age, Preschool, and Infant Grants to
all states, the District of Columbia, and Puerto Rico, based on federal
formulas. At the state level, School-age and Preschool Grants are
administered by the state educational agency (SEA), and Infant Grants are
administered by a designated lead agency, most frequently the state's
department of health or human services. A fixed portion of School-age and
Preschool grants may be retained for state-level activities and program
administration, although the majority of funds from these grants are passed
through SEAs to local educational agencies (LEAs), generally school
districts, according to a federally mandated formula. Infant Grants may be
distributed to local public and private agencies by designated state lead
agencies using state-developed criteria.

Education's OSEP monitors activities funded by these grants and the extent
to which states comply with IDEA in a process known as continuous
improvement monitoring. Several states are selected each year for in-depth
monitoring, including on-site data collection, based on various factors,
such as when they were last monitored, information from grant applications,
and information on each state's status in achieving improved results and
compliance.

School-age and Preschool Grants share the same goal, performance objectives,
and performance measures; fund the same range of services; and have similar
eligibility requirements except for the age-range served, while Infant
Grants differ from these grants in almost all respects. (See table 2.)

School-Age and Preschool Grants Are Similar Except for Age Range Served;
Infant Grants Differ

                    9GAO/AIMD-97-146 and GAO/HEHS-00-78.

Table  2:  Overview of  Eligibility  Criteria, Services  Allowed, Goals  and
Performance  Objectives for  Infant,  Preschool, and  School-age  Grants for
Children with Disabilities

serv
                                                                            School-age
Programs Infant
Grants Preschool
Grants Grants
                      Ages 0 to 3 3 through 5 3
                      through 21
                        Infants and toddlers who are Child with a disability (3 through
Criteria for              developmentally delayed or 21), or with developmental delay
                                               have  (3 to 9 only) who, as a
ice eligibility a condition that will probably result in a developmental
delay or result, needs special education and related who are otherwise at
risk of developmental delay. services.

Family  training,  counseling,  and  home  visits   Student  counseling  and
training, including rehabilitation counseling

Nursing,  health,  and nutrition  services  School  health services  Service
coordination Recreation services

Medical services for diagnostic or evaluation purposes

Occupational and physical therapy Services allowed Psychological and social
work services

Vision, orientation, and mobility services

Speech-language pathology services

Devices to assist the disabled in daily living and audiology services

Transportation services

               Age appropriate special education instruction

                Early identification and assessment services

To improve results for children with disabilities by To enhance family and
child outcomes through early assisting state and local educational agencies
to

Goals intervention services and to have states provide a provide children
with disabilities access to high-comprehensive system of early intervention
services for infants quality education that will help them meet and toddlers
with disabilities and their families. challenging standards and prepare them
for

employment and independent living.

To provide services in settings, such as home or day care, that Preschool
children enter school ready to learn. 
needs. Better identify and serve children eligible for special education
before age 8.

Children have access to the general curriculumPerformance and assessments.

objectives Students receive adequate support to completeTo enhance
children's functional development. high school and transition successfully
after high school.

States address professional development.

Sources: 34 C.F.R. Parts 300 and 303, and U.S. Department of Education 2000
Performance Report and 2002 Program Annual Plan, Volume 2: Individual
Programs.

School-age and Preschool Grants share the common goal of improving

results for children with disabilities by assisting state and local

educational agencies to provide children with disabilities access to high-

quality education that will help them meet challenging standards and

prepare them for employment and independent living. The two programs

use the same set of performance objectives and performance measures.

For example, one objective of both is that preschool children with

disabilities receive services that prepare them to enter school ready to
learn. As a performance measure for this objective, both programs use an
increase in the percentage of preschool children receiving special education
services who have readiness skills when they reach kindergarten.10 These
programs also pay for the same range of special education and related
services, such as physical and occupational therapy and technology to assist
the disabled, such as voice-activated software. Special education and
related services are generally provided at school. To be eligible for these
services, children must be classified by the state as having a disability
and as a result of the disability need special education and related
services.11 The key distinction between the two grants is that School-age
grants serve children ages 3 through 21, whereas Preschool Grants serve only
children ages 3 through 5.

The goal, performance objectives, performance measures, eligibility
criteria, and types of services allowed for Infant Grants differ from those
for School-age and Preschool Grants. This grant is designed to assist states
in developing and implementing a statewide, comprehensive system to provide
early intervention services for infants and toddlers with disabilities (and
at a state's discretion those who are at risk of experiencing developmental
delays) and their families.12 The goal of Infant Grants is to enhance
children's functional development and increase families' capacity to
increase their children's development using a comprehensive system of early
intervention services, including health services, such as tube feeding or
intermittent catheterization, and family training. Objectives are broad and
each has performance measures. For example, an increase in the percentage of
all children under age 3 receiving age-appropriate services in nonschool
settings is a performance measure for the objective of providing services at
home or in daycare, when appropriate. To be eligible for services under
Infant Grants, children

10Readiness skills include those skills that are presumed to enable a child
to be successful in kindergarten. Such skills include knowing that print
reads from left to right, recognizing letters and beginning sounds, reading
numerals, recognizing shapes, and being able to count to 10.

11States, at their discretion, may also use the two grants to provide
services to children ages 3 through 9 experiencing developmental delays as
defined by the State and measured by appropriate instruments and procedures.
(20 U.S.C. Sec. 1401(3)(B)(i).)

12Early intervention services are designed to meet the developmental needs
of an infant or toddler with a disability in any one or more of the
following areas: physical development, cognitive development, communication
development, social or emotional development, or adaptive development. (20
U.S.C. Sec. 1432 (4).)

States Receive All Grants and Many Provide Services to 3 through 5 Year-Olds
with School-Age as well as Preschool Grants

must be under age 3 and have a developmental delay or the potential to
develop one. Because of the age-specific developmental needs of infants and
toddlers, health and family services provided under Infant Grants are more
comprehensive than under the other two grants. These services are provided
primarily in nonschool settings, generally in the home or at a day-care
site.

All 50 states, the District of Columbia, and Puerto Rico receive grants from
each of the three programs, which they distribute to various local public
and private agencies.13 Whether a local agency receives funds from any one
grant depends on whether it is serving the relevant age group. For example,
the Roanoke Interagency Coordinating Council in Virginia, which serves
children from birth through age 2, receives Infant Grants but not School-age
and Preschool Grants. However, many LEAs receive more than one grant. For
example, the Mapleton Local School District in Ohio received School-age and
Preschool Grants in School Year 2001-2002, while the South Washington County
School District in Minnesota received funds from all three programs.

Many states use more than one grant to fund the same range of services for 3
through 5 year-olds. Officials in 18 of the states we contacted told us they
may use School-age Grants to serve 3 through 5 year-olds-the same group of
children served by Preschool Grants. Only one of the states we contacted,
Alaska, does not permit School-age Grants to be used to pay for services for
preschoolers. Also, in a survey of SEAs conducted by the National Early
Childhood Technical Assistance System, 37 SEAs reported that they use funds
from School-age Grants to support the provision of special education and
related services for preschool children with disabilities.14 Since they are
not required to track such information, none of the 19 states we contacted
were able to tell us the percentage of School-age Grant funds they used to
provide services for children aged 3 through 5, although officials in
several states said that the amount was small. Similarly, 18 of the 19
states could not provide us with the percentage of

13The 50 states, the District of Columbia, American Samoa, Guam, Northern
Mariana Islands, Puerto Rico, Virgin Islands, and the Indian Tribes receive
School-age Grants and Infant Grants. The Freely Associated States
(Micronesia, Marshall Islands, and Palau) are only eligible for School-Age
Grants under a special competition. Recipients of Preschool Grants include
the 50 states, the District of Columbia, and Puerto Rico.

14Shelley deFosset, Section 619 Profile, 10th Edition (Chapel Hill, N.C.:
National Early Childhood Technical Assistance System (NECTAS), 2001.)

Grants' Impact Not Yet Evaluated, and Few Data Are Available on
Effectiveness of Special Education Programs for Young Children

children aged 3 through 5 who received services provided with School-age
Grants.15

Many states could not report the extent to which School-age Grants fund
services for 3 through 5 year-olds because of how expenditures are tracked.
The states we contacted reported they track expenditures by budget
functions, such as salaries or transportation, and not by individual
services provided or ages of children receiving services. These states do
not require LEAs to report expenditure data in a way that would allow them
to determine the extent to which School-age Grants fund services for 3
through 5 year-olds, nor does IDEA require it. Education requires only that
states report the number of children ages 3 through 5 collectively receiving
special education and related services under School-age and Preschool
Grants. IDEA does not require specific information about how many children
are served under each.

The effectiveness of these grant programs has not yet been evaluated, in
part, because federal special education funds are only one source used to
pay for services for this age group. Rather than functioning as operating
programs, these grants add to the stream of funds supporting on-going state
and local programs.16 Therefore, it is difficult to isolate the impact of
federal funding for special education from the impact of other funding
sources.17 Instead, studies have tended to focus on how IDEA is being
implemented and on the overall progress of children who receive special
education services, without directly attributing these outcomes to the
receipt of particular services.18

In the 1997 amendments to IDEA, Congress mandated a full, national
assessment to determine the progress in the implementation of IDEA,

15Arkansas reported that 59 percent of children aged 3 through 5 received
special education and related services provided in part with School-Age
Grants.

16U.S. General Accounting Office, Grant Programs: Design Features Shape
Flexibility, Accountability and Performance Information, GAO/GGD-98-137
(Washington, D.C.: Jun. 22, 1998).

17U.S. General Accounting Office, Education for Disadvantaged Children:
Research Purpose and Design Features Affect Conclusions Drawn from Key
Studies, GAO/HEHS-00-168 (Washington, D.C.: Aug. 31, 2000).

18U.S. General Accounting Office, Early Childhood Programs: The Use of
Impact Evaluations to Assess Program Effects, GAO-01-542 (Washington: D.C.:
Apr. 16, 2001).

including the effectiveness of state and local efforts to provide a free
public education appropriate for the needs of students with disabilities and
to provide early intervention services to infants and toddlers. In response
to this mandate, OSEP has contracted with several research organizations to
complete a number of studies. None of these studies will attempt to isolate
the contribution of IDEA grants from the effects of state and local efforts
to improve outcomes for young children; Congress did not prescribe such a
stringent assessment of program effectiveness.

Instead, three of these studies contracted by OSEP are outcome evaluations,
focused on describing the short-term and long-term outcomes for young
children enrolled in programs supported, in part, by these grants. The
National Early Intervention Longitudinal Study will follow children entering
early intervention services supported by Infant Grants. The Pre-Elementary
Education Longitudinal Study will follow children who received preschool
special education services through their experience in preschool and early
elementary school. The Special Education Elementary Longitudinal Study is
documenting the experience of children enrolled in special education as they
move from elementary school to middle and high school. The results from
these studies will not be available for several years, although OSEP has
issued initial reports describing the demographic characteristics of some
study participants, their families, and schools.

In addition to these evaluations describing children's outcomes, OSEP has
contracted a study examining how these programs are implemented. The Special
Education Expenditure Project is intended to answer a variety of questions
on the characteristics of expenditures on programs and services for
preschool special education students. The first in an anticipated series of
reports derived from this project was issued in March 2002 and provides an
overview of special education spending in school year 1999-2000 in the 50
states and the District of Columbia.19 This report presents aggregate data
on how much is spent nationally and how these funds are allocated among
broad program areas. In particular, the report notes that preschool programs
account for about 9 percent of special education expenditures overall and
that 8 percent ($4.1 billion) was spent on preschool programs

19Chambers, Jay G., et al., What Are We Spending on Special Education
Services in the United States, 1999-2000? Advance Report #1, Special
Education Expenditure Project (SEEP) (Palo Alto, CA: American Institutes for
Research, 2002).

operated within public schools and 1 percent ($263 million) was spent on
preschool programs operated outside public schools.

In addition to the efforts now underway to evaluate outcomes and
expenditures on services for young children enrolled in programs supported
by IDEA grants, we found studies from two states-Delaware and
Pennsylvania-on the outcomes of children in special education preschool
programs. The Delaware study found that nearly half of the children who
participated in Preschool Grants-supported programs in Delaware between 1997
and 1999 were able to transition into the regular education program by the
time they were 6 and 7 years-old. The Delaware study also found that
children who participated in preschool special education had significantly
higher grades in kindergarten and first grade than children with
disabilities who did not and that the gap in grades grew between
kindergarten and first grade. The researchers responsible for the Delaware
study attributed the higher grades to the children's participation in
programs supported by Preschool Grants. The Pennsylvania study found that
fewer than half of the preschoolers who participated in early intervention
services in Pennsylvania between 1991 and 1995 were participating in
school-age special education programs between 1996 and 1997, leading
researchers to suggest that preschool early intervention services may have
helped reduce the severity of the developmental delay for some participating
children.

We found some opportunities for better local coordination between programs
funded with Infant Grants and preschool programs, but we were unable to
determine the extent to which overlap between School-age and Preschool
Grants may result in service duplication. We found evidence of problems with
the transition of 3 year-olds between local programs funded with Infant
Grants and preschool programs in 8 of 13 states for which OSEP issued
monitoring reports in the last 2 years. While we could not ascertain whether
overlap between School-age and Preschool Grants results in service
duplication, program officials indicated that the overlap between School-age
and Preschool Grants does not result in administrative inefficiencies.

Some Local Coordination and Program Overlap Issues Exist

Some Coordination We found some lack of coordination between local programs
funded by Problems Identified in the Infant Grants and preschool programs,
which can be funded by Preschool Transition from Infant or School-age
Grants, in several states. Service gaps between programs

funded by Infant Grants and preschool programs can occur for childrenGrants
Programs who turn 3 before the beginning of the school year in which they
can start

attending preschool. IDEA has addressed this problem by allowing Infant
Grants to be used after the third birthday to pay a free appropriate public
education until the beginning of the next school year. Also, federal rules
require that states develop written transition plans for each child to show
how the transition between the two programs will be managed, and Education
monitors and enforces these rules. Specifically, the designated lead agency
for the Infant Grants must discuss with and train parents regarding future
placements for their child and have developed procedures to help the child
adjust to a new setting. To further coordinate this transition, the Infant
Grants statute requires that the lead agency, with the approval of the
family, must convene a conference among the Infant Grants lead agency, the
family, and the LEA at least 90 days before the child is eligible for
preschool services. In addition to the Infant Grants transition
requirements, the School-age Grants statute requires LEAs to participate in
transition planning conferences arranged by the lead agency. Children should
begin receiving services no later than their third birthday.

In 2000 and 2001, OSEP identified problems in the transition from programs
funded by Infant Grants into preschool programs in 8 of the 13 states that
it monitored for compliance with IDEA. OSEP monitoring reports cited a range
of problems related to transitions from programs funded with Infant Grants
into preschool that resulted in gaps in services for preschoolers. Some of
the problems cited include: not holding transition planning conferences
within 90 days of a child's third birthday (6 states); the failure of local
educational agency representatives to attend these conferences, despite
being invited to do so (3 states); and providing inadequate information
about the transition process to parents (2 states). The lack of adequate
information resulted in confusion and unwillingness to cooperate with
service coordinators' requests on the part of some parents and forced other
parents to seek out preschool services on their own. In response to these
problems, OSEP has required corrective action plans for each of the 8 states
to address areas of noncompliance with IDEA related to the transition from
programs funded by Infant Grants into preschool programs.

In addition to the problems cited in OSEP's monitoring reports, we found
some further evidence of problems when children leave Infant Grants programs
in our site visit to Ohio. One state official told us that children and
families may not receive needed services when they transition from the
state's Infant Grants programs into preschool because preschool programs
have more stringent eligibility criteria and lack the family focus of early
intervention programs funded by Infant Grants. Also, a representative of the
Ohio Coalition for the Education of Children with

Disabilities told us that some school districts did not understand that they
are legally required to provide services for preschool children with
disabilities.

These problems were not evident in the other states we visited. Officials in
Maine, Minnesota, and Virginia did not report a lack of coordination between
programs funded by Infant Grants and preschool programs in those states.
Transition issues for these programs appear to have been eliminated in Maine
and Minnesota because each state operates a single program to provide early
intervention and special education services for children from birth through
age 5. In those states, programs funded with Infant Grants and preschool
programs are both operated through a single agency, rather than through two
agencies, as is the case with most of states.20 In Virginia, transition
issues have been minimized because the state requires public education for
children with disabilities beginning at age 2-a year earlier than is
required under federal law. More than two-thirds of children receiving early
intervention services in Virginia transition into public preschool programs
as soon as they become eligible.

Overlap in Ages Served by School-age and Preschool Grants Might Result in
Duplication

Because of overlap between School-age and Preschool Grants, which can both
serve children ages 3 through 5, there is some potential for service
duplication if the two programs do not coordinate at the local level. We
were unable to further evaluate the extent to which coordination problems
may exist because there were no data available that would allow us to do so,
in that states are not required to distinguish between funding sources when
reporting the ages of children served by School-age and Preschool Grants.
Officials from the 4 states where we conducted comprehensive interviews did
not report any coordination problems for these programs and were not able to
provide evidence about whether or not service duplication occurs. At the
federal level, there is no administrative overlap between School-age and
Preschool Grants because Education already administers these grants as if
they were one program. For example, Education requires a single application
for both programs and applies a single set of goals, performance objectives,
performance measures, and reporting requirements to both programs.

20Maine and Minnesota are among the 14 states that have chosen to administer
Infant Grants through their state educational agencies, which also
administer Preschool Grants. The remaining states and the District of
Columbia administer Infant Grants' programs through their departments of
health or human services.

Overlap between School-age and Preschool Grants could be addressed in a
number of ways, according to our analysis. Narrowing the age range served by
School-age Grants to ages 6 through 21 or consolidating the two grants into
a single grant, either with or without a reserved amount of funds for
preschool services, could eliminate overlap between these programs. However,
advantages and disadvantages exist for each option. (See table 3).

Table 3:  Advantages and  Disadvantages of Options for  Addressing Potential
Overlap of Preschool and School-age Grants

aThis would not
apply to states
that currently
administer the
programs as
one, such as
Maine and
Minnesota.

Source: GAO
analysis.

The first three
options would
ensure that
children ages 3
through 5 are
eligible for
services under
only one
program. The
first option,
narrowing the
age range for
School-age
Grants, has the
advantage of
preserving
targeted funds
to serve
preschoolers by
continuing
Preschool
Grants.
However, under
this option,
states would
lose the
flexibility
that they now
have to devote
a greater share
of federal
special
education funds
to serving
preschoolers,
if that is
their priority.

The second
option,
consolidating
School-age and
Preschool
Grants into a
single grant,
has several
advantages. It
would eliminate potential overlap for 3 through 5 year-olds, make it easier
to track funds spent on preschoolers, and may increase the ability of local
school districts to target federal special education funds to children of
any age, depending on local needs. However the last advantage could also be
seen as a disadvantage, potentially reducing services for preschoolers in
those local school districts where they are not considered to be as high a
priority as services for older children. State administrators and parents
told us they are concerned this option would eliminate safeguards for
targeted preschool funding and may lead to a reduction in services for
children ages 3 through 5, although states have been required to provide
special education services to children ages 3 through 5 since 1992 in order
to be eligible for Preschool Grants and other IDEA funds targeted to
children ages 3 through 5 with disabilities. State officials told us that
serving preschoolers, whether in special education or otherwise, is not a
priority for all local school districts, and expenditures of funds for 3
through 5 year-olds would have to compete with the needs of older special
education students. School districts generally do not provide regular
education services to children ages 3 through 4. Moreover, as of November
2001, 39 states require kindergarten be offered to 5 year-olds, but only 12
require pupil attendance.21

The third option, consolidating School-age and Preschool Grants into a
single grant, but reserving some funds for preschool services also would
eliminate potential overlap of IDEA grants for 3 through 5 year-olds.
However, this option has the advantage of preserving minimum spending levels
for preschoolers by including a set-aside provision in the grant
legislation. Depending on how the legislation is written, a potential
disadvantage to this option would be the loss of some flexibility in how
states may allocate funds for preschoolers and other ages of children. This
would occur if the legislation prescribes fixed levels of spending for both
age ranges. Nevertheless, some of the officials and other interested parties
that we contacted indicated that, if the programs were to be consolidated,
they would prefer including a set-aside provision.

Although there are potential advantages to eliminating program overlap,
overall, changes to the current structure of federal grants for special

21Education Commission of the States, State Notes: State Statutes Regarding
Kindergarten (Denver, CO: 2001).

Concluding Observations

Agency Comments and Our Response

education would probably not result in a significant reduction in
administrative burden at the state and local levels. Retaining the current
structure would preserve targeted funds for preschoolers and not introduce
different administrative requirements, but the possibility of service
duplication would continue. Many of the state and local administrators with
whom we spoke indicated they do not see the need for any changes in the
current structure of these grants. In addition, Education officials have
noted a growing level of support for early intervention programs among
lawmakers, program administrators and child advocates, which, in their
opinion, justifies maintaining separate grants to support these programs.

The Department of Education has recognized that there is some potential for
a gap in services for 3 year-olds as they move from programs funded by
Infants Grants into preschool programs and requires that states and local
agencies minimize these service gaps by following federal requirements for
program coordination and transition planning. However, we have seen evidence
that in at least a few localities, states have failed to ensure that federal
regulations are being followed. Education has addressed known transition
problems by requiring these states to develop and implement corrective
action plans that will bring them into compliance with IDEA.

Although there is overlap between School-age and Preschool Grants because
both allow for services to 3 through 5 year-olds, it is not clear whether
this overlap presents problems of service duplication or unnecessary
administrative burden that would indicate the need to change how the grants
are structured. Program experts and federal, state, and local administrators
that we interviewed did not report any problems and there were no data
available that would allow us to determine the extent to which program
overlap resulted in coordination or administrative problems.

We provided the Department of Education an opportunity to comment on a draft
of this report and received technical comments which we have incorporated
into this report as appropriate.

We are sending copies of this report to the Chairman of your subcommittee,
the Secretary of Education, and appropriate congressional committees. Copies
will also be made available to other interested parties upon request. If you
have questions regarding this report, please call me at

(202) 512-7215  or Eleanor  Johnson, assistant director,  at (202) 512-7209.
Other contributors are listed in the appendix.

Sincerely yours,

Marnie S. Shaul Director, Education, Workforce and Income Security Issue

Appendix: GAO Contacts and Staff Acknowledgments

GAO Contacts Regina Santucci (202) 512-6317, email: [email protected]

Staff In addition to those above, Elspeth Grindstaff, Patrick DiBattista and
Jon Barker made major contributions to this report.

Acknowledgments

Related GAO Products

Head Start and Even Start: Greater Collaboration Needed on Measures of Adult
Education and Literacy. GAO-02-348. Washington, D.C.: 2002. March 29, 2002.

Bilingual Education: Four Overlapping Programs Could Be Consolidated.
GAO-01-657. Washington, D.C.: 2001. May 14, 2001.

Early Childhood Programs: The Use of Impact Evaluations to Assess Program
Effects. GAO-01-542. Washington, D.C.: April 16, 2001.

Title I Preschool Education: More Children Served, but Gauging Effect on
School Readiness Difficult. GAO/HEHS-00-171. Washington, D.C.: September 20,
2000.

Early Education and Care: Overlap Indicates Need to Assess Crosscutting
Programs. GAO/HEHS-00-78. Washington, D.C.: April 28, 2000.

Evaluations of Even Start Family Literacy Program Effectiveness.
GAO/HEHS-00-58R. Washington, D.C.: March 8, 2000.

Early Childhood Programs: Characteristics Affect the Availability of School
Readiness Information. GAO/HEHS-00-38. Washington, D.C.: February 28, 2000.

Managing for Results: Using the Results Act to Address Mission Fragmentation
and Program Overlap. GAO/AIMD-97-146. Washington, D.C.: August 29, 1997.

(130029)

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