Elementary and Secondary Education: Flexibility Initiatives Do Not
Address Districts' Key Concerns About Federal Requirements (Chapter
Report, 09/30/1998, GAO/HEHS-98-232).

The wide range of federal requirements that affect school districts
reflect a host of policy goals and program objectives, such as ensuring
equal educational opportunity and promoting high-quality instruction.
Many of these federal requirements--especially those that most directly
affect teaching--come with federal dollars, but others do not. Federal
laws and regulations affect school districts in many ways, from the food
they serve in their cafeterias to the special education programs they
offer for the disabled to the construction and maintenance of school
buildings. Federal requirements are augmented by state and local
requirements as well as by court decisions. The school district
officials GAO spoke with generally supported federal programs and
mandates. At the same time, they voiced concerns about (1) the
difficulty in obtaining accurate, timely, and sufficiently detailed
information about federal requirements and federal funding; (2) the
limited funds available to meet program and administrative costs; and
(3) the logistical and management challenges posed by some requirements,
such as those that specify timelines for completing procedural tasks or
require specialized personnel. Several initiatives have been designed
and implemented during the last five years to give school districts
greater flexibility. For example, school districts may be able to obtain
waivers from federal requirements and can sometimes combine or transfer
federal program funds. However, the initiatives generally are not
structured to address the information, funding, and management issues
that school districts cited as their primary concerns.

--------------------------- Indexing Terms -----------------------------

 REPORTNUM:  HEHS-98-232
     TITLE:  Elementary and Secondary Education: Flexibility
	     Initiatives Do Not Address Districts' Key Concerns About
	     Federal Requirements
      DATE:  09/30/1998
   SUBJECT:  State-administered programs
	     School districts
	     Elementary education
	     Aid for education
	     School management and organization
	     Secondary education
	     Funds management
	     Waivers
	     Federal regulations
	     Compensatory education
IDENTIFIER:  Individualized Education Program
	     National School Lunch Program
	     Dept. of Education Title I Program

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GAO/HEHS-98-232

Cover
================================================================ COVER

Report to Congressional Requesters

September 1998

ELEMENTARY AND SECONDARY EDUCATION
- FLEXIBILITY INITIATIVES DO NOT
ADDRESS DISTRICTS' KEY CONCERNS
ABOUT FEDERAL REQUIREMENTS

GAO/HEHS-98-232

Federal Requirements and School Districts

(104901)

Abbreviations
=============================================================== ABBREV

  ADA - Americans With Disabilities Act
  AHERA - Asbestos Hazard Emergency Response Act
  CAROI - Cooperative Audit Resolution and Oversight Initiative
  EDGAR - Education Department General Administrative Regulations
  EEOC - Equal Employment Opportunity Commission
  EPA - Environmental Protection Agency
  ESEA - Elementary and Secondary Education Act
  ESL - English as a Second Language
  GEPA - General Education Provisions Act
  IASA - Improving America's Schools Act
  IDEA - Individuals With Disabilities Education Act
  IEP - Individualized Education Program
  OSHA - Occupational Safety and Health Administration
  UST - underground storage tank

Letter
=============================================================== LETTER

B-278819

September 30, 1998

The Honorable William Goodling
Chairman, Committee on Education
 and the Workforce

The Honorable John Kasich
Chairman, Committee on the Budget

The Honorable Christopher Shays
Chairman, Subcommittee on Human Resources
Committee on Government Reform
 and Oversight
House of Representatives

As you requested, this report presents information on (1) the major
federal requirements that affect school districts, (2) the issues
that school districts face in implementing these requirements, and
(3) the impact of the Department of Education's flexibility
initiatives on school districts' ability to address these
implementation issues.

We are sending copies of this report to the Secretary of Education,
the Secretary of Agriculture, the Administrator of the Environmental
Protection Agency, and other interested committees and parties.  We
will also make copies available to others on request.

This report was prepared under the direction of Harriet C.  Ganson,
Assistant Director, Education and Employment Issues, who may be
reached at (202) 512-9045, if you or your staffs have any questions.
Major contributors to this report are listed in app.  IV.

Carlotta C.  Joyner
Director, Education and
 Employment Issues

EXECUTIVE SUMMARY
============================================================ Chapter 0

As dissatisfaction with America's educational system has grown,
efforts to implement broad, systematic education reform have
accelerated.  In calling for new initiatives to improve teaching and
learning, some education experts and local administrators have
advocated loosening federal requirements that are thought to
potentially impede new or innovative instructional approaches.  As
this view has found increasing acceptance over the past 5 years, the
Congress and the Department of Education have put in place several
initiatives to promote flexibility.  Some observers have welcomed
these provisions, but others have expressed concern that important
objectives--such as promoting equal educational opportunity--may be
compromised if federal requirements are loosened.

To obtain more information on these issues, the Chairman of the House
Committee on Education and the Workforce, the Chairman of the House
Committee on the Budget, and the Chairman of the House Subcommittee
on Human Resources, Committee on Government Reform and Oversight,
asked GAO to (1) describe the major federal requirements that affect
school districts, (2) identify the key issues that school districts
face in implementing these requirements, and (3) analyze the impact
of the Department of Education's flexibility initiatives on school
districts' ability to address these implementation issues.

   BACKGROUND
---------------------------------------------------------- Chapter 0:1

Because the approximately 15,000 U.S.  school districts vary greatly
in size and scope, school districts' involvement with the federal
government can also vary.  Reflecting their large and diverse
populations, some districts offer an array of specialized programs,
such as magnet schools, vocational programs, and programs for
students with limited English proficiency.  As a result, these
districts may receive federal assistance from funding streams that
target these specific areas, and may also be subject to a greater
number of federal program requirements.  Other (often smaller)
districts may be involved with the federal government through a
smaller number of broadly targeted programs and widely applicable
regulations.  As a whole, however, federal funds account for only a
small share of total education spending--about 7 percent in school
year 1995-96, compared with state and local contributions of 47 and
46 percent, respectively.

   RESULTS IN BRIEF
---------------------------------------------------------- Chapter 0:2

The wide range of federal requirements that affect school districts
reflects many different policy goals and program
objectives--including ensuring equal educational opportunity,
promoting high-quality instruction, guarding against safety and
health hazards, and protecting the integrity of federal funds.  Many
of these federal requirements--especially those that most directly
affect teaching--come with federal dollars, but others do not.
Federal laws and regulations affect school districts in all their
varied activities, including the food they serve in the cafeteria,
the special education programs for students with disabilities, the
employment of school and district staff, and the construction and
maintenance of school buildings.  Federal requirements are augmented
by state and local requirements and court decisions.

District officials generally expressed support for federal programs
and mandates, recognizing the importance of goals such as ensuring
school safety and promoting equal educational opportunity.  At the
same time they noted their concerns with implementation issues that
made achieving these goals more difficult.  Rather than focusing on a
single federal program or requirement, these implementation issues
extend across several broad areas, including

  -- the difficulty in obtaining accurate, timely, and sufficiently
     detailed information about federal requirements and federal
     funding;

  -- the limited funds available to meet program and administrative
     costs; and

  -- the logistical and management challenges presented by certain
     requirements, such as those that specify timelines to complete
     procedural tasks or require specialized personnel.

In the past 5 years, several initiatives have been designed and
implemented to provide more flexibility to school districts.  For
example, districts may be able to obtain waivers (temporary
exemptions from certain specific federal requirements) and can
sometimes combine or transfer certain federal program funds.
However, some of these initiatives have not been widely used by the
districts.  In addition, because they are narrowly structured, these
flexibility initiatives generally do not address school districts'
major concerns.  Although information-related issues are very
important to school district officials, the recent flexibility
initiatives increase the amount of information districts need, rather
than simplifying or streamlining information on federal requirements.
Federal flexibility efforts neither reduce districts' financial
obligations nor provide additional federal dollars.  Because the
flexibility initiatives are limited to specific programs, their
ability to reduce administrative effort and streamline procedures is
also limited.  Broadening the scope of federal flexibility efforts,
however, raises concerns about whether the underlying goals of
federal programs can be achieved without the guidance of specific
regulatory provisions.

   PRINCIPAL FINDINGS
---------------------------------------------------------- Chapter 0:3

      FEDERAL REQUIREMENTS AND
      FINANCIAL ASSISTANCE REFLECT
      DESIRE FOR SAFE AND
      EFFECTIVE SCHOOLS FOR ALL
      STUDENTS
-------------------------------------------------------- Chapter 0:3.1

The body of federal requirements that affect school districts
reflects a variety of purposes and objectives.  To help ensure equal
educational opportunity for students with various types of
disadvantages, the federal government has passed antidiscrimination
laws and funded special programs targeted at (among others) children
with disabilities, homeless children, and children with limited
English proficiency.  To improve instructional quality in key subject
areas, the federal government has sponsored special programs directed
at subject areas such as math and science, vocational education, and
information technology.  To support education by ensuring a safe
environment for students and teachers, federal environmental
requirements (such as those concerning asbestos) are intended to
guard against particular health hazards.  To protect the integrity of
federal funds, federal requirements include financial provisions such
as spending restrictions and carryover limits.

In addition to their sizable financial contributions to the schools,
states also play a key role in administering federal programs and
distributing federal funds.  As part of their monitoring and
oversight activities, states often impose additional requirements on
school districts.  For example, in one state GAO visited, the state
requires school districts to submit more documentation on certain
purchases made with federal funds than required by federal
regulations.  For many districts, it can be difficult to distinguish
between state and federal requirements, especially in cases where a
state requirement arises from the implementation of a federal program
or regulation.

      IMPLEMENTATION ISSUES
      RELATING TO FEDERAL
      REQUIREMENTS AFFECT HOW
      DISTRICTS PLAN, FUND, AND
      OPERATE EDUCATIONAL PROGRAMS
-------------------------------------------------------- Chapter 0:3.2

For school district officials, implementing this array of federal
requirements can be a challenging task.  School district officials
generally supported the goals and purposes of the associated programs
and mandates, recognizing the value in such objectives as ensuring
student safety.  However, they also identified implementation issues
that sometimes made meeting these requirements difficult.  First,
school district officials need--and many lack--accurate, timely, and
detailed information on federal requirements and funding allocations
to ensure compliance, plan educational programs, and conduct long-
and short-term financial planning.  The number and complexity of
federal requirements make it hard to keep informed, even considering
the technical assistance provided by state and federal agencies.
With incomplete information, district officials may make only
conservative and narrow interpretations of federal requirements,
believing they have less flexibility than they actually do.  As a
result, districts may lose the opportunity to structure programs as
they would like.  In addition, misunderstandings about the scope of
federal requirements may lead some districts to spend more than
necessary to comply with federal regulations, particularly in
environmental areas.

Second, staff from the majority of districts GAO visited expressed
concern about the cost of administering federal programs and
providing mandated services, especially in light of limited federal
support.  District officials generally recognized the value of
federal mandates in areas such as special education, environmental
requirements, and building accessibility, but they said these are
often costly to implement.  In addition, program directors and
superintendents identified two key areas--eligibility determination
for certain targeted federal programs and accounting and reporting
requirements--as major contributors to their administrative costs.
For example, district officials told us that the process for
determining students' eligibility for free and reduced-price lunches
remains paper-intensive and challenging, although efforts to
streamline the process have been helpful.  Staff from a few districts
expressed dissatisfaction with restrictions on raising and spending
funds; however, these issues were raised less frequently.

Third, district officials identified several types of logistical and
management challenges associated with certain federal requirements,
such as meeting mandated timelines, finding qualified and capable
staff or suppliers to provide required services, and balancing
competing goals or needs.  For example, to ensure that special
education students receive the help they need in a timely manner,
school districts are required to complete certain tasks within a set
number of days.  Special education directors said that meeting these
timelines sometimes created logistical problems for them--for
example, when staff or service providers were unable to complete
their tasks because of illness or emergency.

      RECENT FLEXIBILITY
      INITIATIVES ARE GENERALLY
      NOT STRUCTURED TO ADDRESS
      SCHOOL DISTRICTS' MAJOR
      IMPLEMENTATION ISSUES
-------------------------------------------------------- Chapter 0:3.3

Recent efforts to provide additional flexibility to school districts
include waivers, financial flexibility mechanisms, and consolidated
planning.  Waivers--temporary exemptions from certain specific
federal requirements--can allow districts to suspend some federal
program rules.  Several new financial flexibility mechanisms allow
school districts additional flexibility in the use of certain federal
program funds; for example, one provision can allow districts to
shift a limited amount of funds from one covered program to another.
Finally, a consolidated planning process allows school districts to
submit one plan or funding application that covers several federal
programs, rather than prepare separate documents for each program.

These initiatives are generally not structured to address the
information, funding, and management issues that school districts
identified as their primary concerns.  First, rather than simplifying
the necessary information on federal requirements, these flexibility
initiatives actually expand the amount of information school district
officials need.  To take advantage of these provisions, district
staff must know that they exist and learn how to use them.  Because
these initiatives are program-specific, and each applies to a
different set of programs, district officials need detailed
information on each provision--information that is often difficult to
find.

Second, flexibility initiatives do not address school districts'
funding concerns; by design, they cannot increase the flow of funds
to school districts nor can they relieve districts of their major
financial obligations.  The areas covered by the flexibility
initiatives are not those that school districts cited as especially
costly:  special education, environmental, and building accessibility
requirements.  Similarly, the flexibility initiatives can have only a
limited impact on school districts' administrative costs because they
do not cover several key program areas such as food service and
special education.  However, waivers and consolidated planning can
help some districts streamline processes in other administrative
areas, including the process of applying for federal funds.

Third, the limited coverage of flexibility initiatives also precludes
them from addressing several of the logistical and management issues
that school districts identified as key issues, such as meeting
timelines for evaluating special education students and finding
qualified personnel (such as bilingual teachers) to implement key
federal programs.  For example, because the flexibility initiatives
do not extend to special education requirements, districts cannot use
these provisions to address their concern with timelines.

   AGENCY COMMENTS
---------------------------------------------------------- Chapter 0:4

GAO provided a draft of this report to the Department of Agriculture,
the Department of Education, and the Environmental Protection Agency
(EPA) for their review and comment.

In its comments, the Department of Agriculture suggested that because
the report was based on information collected from a limited number
of school districts, GAO should add information to the report putting
issues related to school nutrition programs into context.  For
example, it suggested adding material to the report explaining that
the administrative process associated with determining school
nutrition program eligibility is part of an effort to achieve a
balance between accessibility for participants and accountability for
public funds.  GAO has included such contextual information in the
report.  The Department also expressed concern that the draft report
indicated the cost of running school nutrition programs is
prohibitive due to administration burdens.  Relatedly, it said the
reader may be left with the impression that the cost of implementing
the updated nutrition standards in the school nutrition programs,
issued in response to the Healthy Meals for Healthy Americans Act, is
prohibitive.  Although district officials expressed concern about
administrative issues and the potential cost of implementing the
updated nutrition standards, they did not state that these costs are
prohibitive.  GAO added language to the report to clarify this point.
Other Department of Agriculture officials also made technical
comments that GAO incorporated as appropriate.  The Department's
comments appear in appendix III.

Program directors and other officials from the Department of
Education's Office of Elementary and Secondary Education and Office
of Special Education Programs provided oral comments on the report.
These officials told GAO that they believe that flexibility has had a
positive impact in addressing local concerns.  They cited the
granting of waivers, the approval of 12 states to participate in the
Ed-Flex project, state acceptance of consolidated planning, and a
growth in the number of schoolwide projects as examples of positive
results.  GAO agrees that the implementation of flexibility
provisions such as schoolwide programs and consolidated planning has
provided benefits to some state and local officials.  However, by
design these provisions do not address the key implementation issues
identified by local school districts.  In addition, Department
officials stated that they do not believe the waiver provisions are
very burdensome or complicated and that, as a result, GAO may have
overstated districts' and states' information needs in using
flexibility provisions.  GAO agrees that the process of applying for
waivers does not appear to be overly burdensome or complicated.
However, districts do need to know which programs and requirements
are covered by flexibility provisions and how those provisions may be
used, and this information can be difficult to find.  GAO revised the
report to clarify that gathering information on these provisions can
be difficult, even if the provisions are relatively simple to use
once this information has been obtained.

Department officials also emphasized that the Department provides
considerable technical assistance to grantees on flexibility
provisions and the flexibility within federal programs.  For example,
Department officials cited guidance on federal programs that included
information on flexibility provisions.  This guidance was sent to all
states, which were requested to share it with local school districts
and with auditors.  GAO recognizes the Department's extensive efforts
in this area.  However, GAO's interviews with Department officials,
state officials, and school districts indicate that school districts
face information gaps that can affect their ability to successfully
implement federal programs and take advantage of flexibility
initiatives.

EPA officials, including program managers in the areas of asbestos
and underground storage tanks, said the report was fair and accurate
and had no additional comments.

INTRODUCTION
============================================================ Chapter 1

Because U.S.  school districts differ a great deal in size and scope,
their involvement with the federal government can also vary.
Districts that offer a wide variety of educational choices--such as
magnet schools, vocational programs, and programs for students with
limited English proficiency--may receive federal assistance from a
large number of sources and be subject to additional program
requirements.  Other (often smaller) districts may be involved with
the federal government through a smaller number of more broadly
targeted programs and requirements, such as those that provide
funding for teacher training.

Although there has been widespread agreement on the need to improve
the educational system, school districts are central to some
education reform efforts and more peripheral to others.  Certain
education reform movements, like charter schools, have minimized the
role of the school district.  In contrast, in other reform efforts
the district plays a central role in improving curriculum,
instructional methods, student assessment, and professional
development.  Many proponents of all varieties of education
reform--regardless of their view of school districts--regard
flexibility as a key element in efforts to improve teaching and
learning.  However, little information is currently available about
what types of flexibility are thought to be needed and how federal
flexibility initiatives have been used.

   SCHOOL DISTRICTS VARY IN SIZE,
   PROGRAMS OFFERED, AND FEDERAL
   INVOLVEMENT
---------------------------------------------------------- Chapter 1:1

U.S.  school districts vary greatly in size, from rural districts
with only one school to citywide systems encompassing hundreds of
schools and hundreds of thousands of students.  In enrollment, school
districts range from some with only a few students to New York City
with over 1 million.  As shown in figure 1.1, while only a few
districts had enrollments of over 100,000 students in school year
1995-96, a much larger number of districts reported serving fewer
than 150 students.  These small districts, although numerous,
accounted for less than one-half of 1 percent of total student
enrollment.  Some districts (usually smaller ones) served only
younger children or only secondary students.  Although about 74
percent of school districts provided instruction from the beginning
of school through 12th grade, 22 percent of school districts provide
instruction only through grade 8, and the remaining 4 percent have a
low grade of 7 or higher and a high grade of 12.  Districts with more
than 100,000 students accounted for about 12 percent of student
enrollment but made up less than 1 percent of all school districts.
Similarly, while more school districts were located in rural areas,
urban districts served a greater proportion of students.

   Figure 1.1:  Number of U.S.
   School Districts, by Enrollment
   Size

   (See figure in printed
   edition.)

Differences in the composition of the student population are
sometimes reflected in the specialized programs found in many
districts and schools.  In 1993-94 (the most recent school year for
which data are available), 43 percent of public schools provided
English as a Second Language (ESL) programs, and 18 percent of public
schools provided bilingual programs, for students with limited
English proficiency.  Many districts offer vocational-technical
programs, which provide skill training in specialized areas as well
as academic instruction.\1 Some districts offer "magnet" programs,
which focus on a special subject theme.  Some districts have
established alternative schools; in 1993-94 there were approximately
2,600 of these schools in the country.\2

Districts that have a wide variety of specialized programs may
receive federal assistance from separate funding streams that target
these specific areas.  For example, in 1997, 64 districts that were
implementing desegregation plans received federal funds for magnet
school programs, and, in 1996, 509 school districts received federal
funds to support programs for children with limited English
proficiency.  As a result, larger districts and districts with a
wider variety of programs and populations may receive federal
assistance from a larger number of sources and also be subject to a
greater number of federal program requirements.  One large urban
district we visited received a total of 27 federal grants, from
agencies as diverse as the Department of Education, the Department of
Housing and Urban Development, and the Department of Agriculture.
Many of these programs targeted specific areas or specific groups of
students, such as students with limited English proficiency,
neglected and delinquent youth, and Native Americans.  Another,
smaller district received only four federal grants, all from the
Department of Education and all targeted fairly broadly.

--------------------
\1 Some districts that offer vocational programs do not operate these
programs themselves, but send their students to vocational programs
operated by another district.

\2 This total includes some schools that were classified as "other."

   SOME MAJOR EDUCATION REFORM
   EFFORTS REDUCE SCHOOL
   DISTRICTS' ROLE, WHILE OTHERS
   MAINTAIN DISTRICT-LEVEL FOCUS
---------------------------------------------------------- Chapter 1:2

Many Americans see the nation's public elementary and secondary
schools as average at best.  With American students' achievement in
mathematics and science lagging behind that of their peers in other
industrial nations, dissatisfaction with the educational system has
fueled calls for widespread systematic reform.  Various education
reform efforts have adopted differing approaches toward the role of
the school district.  Some initiatives view school district
organizations as part of the problem, while others are designed to
rely strongly on district leadership.

Two education reform strategies--charter schools and school-based
management--have attempted to expand the role of principals and other
school administrators, reducing or even eliminating the role of the
school district in making key decisions on educational programs.
Charter schools are schools formed by parents, teachers, and/or
community members who collectively determine the school's structure,
mission, and curricular focus.  Charter school laws essentially allow
entities other than school districts to start and operate public
schools.  Charter schools therefore are generally not required to
follow all policies, procedures, and requirements of the local school
district.  In addition, although they receive public funds and must
comply with federal requirements, charter schools are generally
designed to operate with more autonomy from state and local
regulations.  Charter schools are responsible for meeting the terms
of their charters, however, and these charters may include specific
educational outcomes.\\3 Proponents of charter schools believe that
this freedom from district-level and state-level requirements will
lead to better academic outcomes both at charter schools and at the
surrounding district schools.

Another type of reform initiative--school-based management--has also
focused on freeing building-level administrators from some of the
restrictions imposed by district-level management.  Initiatives in
school-based management have become common, particularly in light of
perceptions that district bureaucracies and school boards are
unresponsive and impose restrictive requirements that hinder the
ability of individual schools to meet their unique needs.  Under
school-based management, the school district typically delegates some
control over decisionmaking on budgets, personnel, and/or
instructional programs to school administrators, teachers, parents,
or other members of the community.  For example, school-based
management could allow individual schools to choose to offer either
half-day or full-day kindergarten, instead of following a uniform
policy that was decided at the district level.  Similarly,
school-based management could allow individual schools to hire fewer
staff and buy more computers (or vice versa), rather than have those
decisions made by the district office.  Proponents of school-based
management believe that allowing the people most closely associated
with children to make decisions about a school will make the school
more responsive to children's needs.\4

Although charter schools and school-based management primarily focus
on administration at the school level, other reform efforts involve
changes in curriculum, instructional strategies, professional
development, and student assessment that are implemented on a
districtwide basis.  For example, one school district we visited
established new standards, curricula, and assessments at the district
level aimed at increasing accountability for student learning.
Similarly, in our 1993 report on education reform efforts, we
reviewed another school district that had developed its own school
improvement model, which was subsequently adopted by other districts.
Another district in this study had adopted a policy of testing
students frequently and evaluating teachers on the basis of student
performance on certain tests that related specifically to the
district's standard curriculum.\5

Whether reforms are initiated outside of the school district (as in
charter schools) or at the school or district level, many proponents
of education reform believe that efforts to improve teaching and
learning will be more successful if local school districts have more
flexibility to adapt federal programs to local needs.  The National
Governors Association, along with several major education
associations, has advocated increased flexibility for school
districts, including a loosening of federal and state requirements
that are thought to potentially impede new or innovative reform
approaches.  Over the past 5 years, the Congress has enacted several
provisions designed to provide schools and districts with more
flexibility in how they use federal funds.  In addition, for certain
areas the Congress has given the Department of Education the
authority to grant waivers--temporary exceptions to certain federal
requirements--to states and school districts.  While some experts
have welcomed these provisions, other observers have urged caution.
Because many federal and state restrictions were established to
protect students, they fear that important social purposes--such as
protecting civil rights--may be compromised if federal restrictions
are loosened or lifted.  Despite the importance of this debate,
little information has been available about the issues school
districts face in implementing various federal requirements, what
flexibility they would find most useful, and how existing flexibility
has been used.

--------------------
\3 For more information about charter schools, see Charter Schools:
Federal Funding Available but Barriers Exist (GAO/HEHS-98-84, Apr.
30, 1998).

\4 For more information about school-based management, see Education
Reform:  School-Based Management Results in Changes in Instruction
and Budgeting (GAO/HEHS-94-135, Aug.  23, 1994).

\5 For more information on district-level reform efforts, see
Systemwide Education Reform:  Federal Leadership Could Facilitate
District-Level Efforts (GAO/HRD-93-97, Apr.  30, 1993).

   OBJECTIVES, SCOPE, AND
   METHODOLOGY
---------------------------------------------------------- Chapter 1:3

The Chairman of the House Committee on Education and the Workforce,
the Chairman of the House Committee on the Budget, and the Chairman
of the House Subcommittee on Human Resources, Committee on Government
Reform and Oversight, asked us to report on how federal requirements
affect local school districts.  Specifically, the objectives of this
study were to

  -- describe the major federal requirements that affect school
     districts;

  -- describe the issues that local school districts face in
     implementing these requirements; and

  -- analyze the impact of the Department of Education's flexibility
     initiatives on school districts' ability to address these
     implementation issues.

Our approach relied on data from a variety of sources.  We
interviewed officials from 87 school districts using a variety of
methods--telephone interviews, group interviews, and site visits.  We
also interviewed representatives from 15 major education associations
and federal and state program officials.  We surveyed officials from
all 50 states to obtain information on the use of financial
flexibility mechanisms by states and local school districts.  We
reviewed the education finance literature and analyzed federal laws
and regulations applying to school districts.  In addition, we
analyzed data from the Department of Education on school district
characteristics and the use of federal waivers.  We did not verify
the data we obtained from the Department of Education.

We focused our review on 36 federal programs or mandates that
education experts, school district staff, state and federal
officials, and the literature identified as having a major impact on
school districts.  We reviewed the relevant legislation (and, in some
cases, the regulations and/or agency guidance) to obtain descriptive
information about the programs or mandates.  These 36 requirements
were defined according to their impact on school districts, not
necessarily by law or by program.  For example, the Americans With
Disabilities Act (ADA) contains provisions regarding the
accessibility of public buildings and also regulates the employment
protections extended to persons with disabilities.  These provisions
clearly have separate and distinct implications for school districts,
although they are contained in the same piece of legislation.
Therefore, we elected to treat these requirements separately.
Similarly, the Elementary and Secondary Education Act (ESEA) and the
Improving America's Schools Act (IASA), which reauthorized ESEA in
1994, deal with many programs in a single legislative act.  In other
cases, multiple pieces of legislation may provide a vehicle for very
similar requirements.  For example, the Asbestos School Hazard
Abatement Act and the Asbestos Hazard Emergency Response Act (AHERA)
established regulations for the management of asbestos in schools.
Because both laws affect how schools and districts manage asbestos,
we considered these requirements together.  Although our list of
major requirements is not comprehensive, it does capture the
requirements that education experts and district officials viewed as
having a significant impact on school districts' administration and
operations.

We used several methods to gather information on school districts'
views of the issues that affect their implementation of federal
requirements.  Early in our study, we conducted two group interviews
of school district personnel at major education conferences.  The
district officials who participated in these group interviews
represented 15 states from across the country.  From these group
interviews, and from our interviews with associations and federal
officials, we learned that state requirements--and differing state
interpretations of federal requirements--can play a crucial role in
the implementation of federal laws and regulations.  Because school
district officials could not, in general, distinguish between state
and federal requirements, obtaining the views of district officials
nationwide would be problematic because district staff in different
states would be responding to different sets of requirements.  For
this reason, we conducted the majority of our interviews with school
district officials in a few states.  As a result, when we discussed
particular requirements with officials from different districts, we
could adequately account for variation across states, although we
cannot generalize our results to all states.

We selected three states--Pennsylvania, Massachusetts, and
Louisiana--as the major focus of our study.  We chose these states
because each had a diverse student population in terms of income,
disability status, and urban and rural areas, and because they
differed in other characteristics, including the mix of state and
local funding for education, the relative amount of state funding
provided to poorer and wealthier districts, the number of federal
waivers granted to districts in the state, and whether the state had
been designated as an "Ed-Flex" state.\6

In each of these three selected states, we obtained detailed
information from site visits and from a telephone survey of school
district superintendents and other officials.  We visited two
districts (one relatively large and one relatively small) in each of
the three states.  (Characteristics of the districts we visited are
shown in table 1.1.) The districts we visited ranged from a large
inner-city district with 257 schools and over 200,000 students to a
rural district with 2 adjacent schools and an enrollment of just over
1,000.  We selected these districts primarily on the basis of
enrollment size, geographic location, and urban/rural mix; where more
than one district met our requirements we made a random selection
from these districts.  During our site visits, we interviewed the
district's superintendent;\7 the food service director; the assistant
superintendent, business manager, or facilities manager; the Title I
and special education directors;\8 and directors of other programs
(such as vocational education) where applicable.  We also visited
state officials with responsibility for special education, Title I,
and other major programs in each state.

                                       Table 1.1

                          Characteristics of the Districts We
                                        Visited

                                             Berlin
Characteristi                          Brothersvall  Philadelph        East
c                  Boston   Wachusett            ey          ia   Feliciana  St. Landry
-------------  ----------  ----------  ------------  ----------  ----------  ----------
Student            62,980       6,285         1,073     208,973       2,682      16,694
 enrollment
Number of             125          11             2         257           4          35
 schools
Total staff       7,828.4       728.4           132      25,528         Not         Not
                                                                  available   available
Total          $491,500,0  $39,357,83    $8,066,368  $1,500,000  $11,592,04  $63,462,16
 budget\a              00           1                      ,000           9           6
Per pupil       $7,804.06   $6,262.18     $7,517.58   $7,177.96   $4,322.17   $3,801.50
 spending
---------------------------------------------------------------------------------------
\a The time period for the budget figures varies somewhat due to the
differences in the fiscal year for different states and school
districts.

In addition, we conducted a telephone survey with officials from
school districts in each of these three states.  We selected a random
sample of school districts in each state, stratified by size.  We
drew this sample from the Department of Education's Common Core of
Data database, which contains information on the approximately 15,000
school districts in the United States as reported by states and
school districts for the 1993-94 school year.  In drawing the sample,
we eliminated districts that reported no schools for the 1993-94
school year.  We verified our data through the current school
district listing provided on each state's Internet site.  We
eliminated a few districts from the sample because they were no
longer operating or had already participated in a site visit or group
interview.  For each of the 83 districts selected, we sent a letter
to the district superintendent asking the superintendent or assistant
superintendent to participate in a 1-hour telephone interview with us
regarding the implementation of federal requirements.
Superintendents were invited to include key staff members in the
interview (many of them did) or to solicit comments from staff prior
to the interview.  A total of 59 school districts (71 percent)
participated in the survey.  In each state, at least 5 percent of the
districts in the state participated in the survey.  However, due to
the small number of total participants and the qualitative nature of
many of the questions, the survey was not designed to enable us to
project quantitative estimates at the state level.  In these
interviews, we asked districts about the information and technical
assistance they received on federal requirements, the eligibility
determination process, federal funding, application processes,
accounting and reporting requirements, and other areas.  All data
were self-reported.

Our group interviews, site visits to states and school districts, and
telephone survey results also provided important information on how
federal flexibility efforts have affected local school districts.  We
obtained additional information on waivers of state requirements,
consolidated planning and reporting initiatives, and financial
flexibility mechanisms by surveying education officials in the 50
states.  In this survey, we asked state officials about the number
and types of waivers granted for state requirements, the extent to
which school districts in their state submitted consolidated
applications and reports, and the extent to which school districts in
their state used certain financial flexibility mechanisms.  In
addition, we reviewed the Department of Education's data on waivers
and interviewed federal and state officials to discuss their views on
flexibility initiatives.  We also reviewed the legislation,
regulations, and guidance associated with these efforts.

Our work was done between September 1997 and August 1998 in
accordance with generally accepted government auditing standards.

--------------------
\6 Under the Education Flexibility Partnership Demonstration Program
(Ed-Flex), the Department of Education has delegated to selected
states a portion of its authority to waive certain federal
requirements.

\7 The superintendent in one of these districts refused our request
for an interview.

\8 One district we visited did not receive Title I funds.

FEDERAL REQUIREMENTS AND FINANCIAL
ASSISTANCE REFLECT DESIRE FOR SAFE
AND EFFECTIVE SCHOOLS FOR ALL
STUDENTS
============================================================ Chapter 2

School districts serve their communities in several key roles--not
only as educators but also as food service providers, employers, and
managers of public facilities.  In each of these roles, the school
district is faced with federal requirements designed to ensure equal
educational opportunity, protect the integrity of federal funds,
improve quality in key educational areas, and ensure students' and
employees' safety and health.  Many of these requirements are
accompanied by federal dollars, although federal funding seldom
provides complete support.  States play a key role in administering
federal programs and also impose their own restrictions on school
district activities.

   FEDERAL REQUIREMENTS ARE
   DESIGNED TO PROMOTE EQUITY AND
   EXCELLENCE IN EDUCATION
---------------------------------------------------------- Chapter 2:1

School districts must comply with federal requirements in several
areas, including not only education but also environmental,
employment, and food services.  This range of programs and mandates
reflects a variety of purposes and objectives.  Federal programs and
mandates are designed to ensure equal educational opportunity,
improve educational quality (especially in certain targeted areas),
guard against safety and health hazards, and protect financial
integrity.

Two of these goals--equal educational opportunity and improving
quality--concern how the district provides instruction.  Many federal
education programs (including some of the largest federal efforts)
are intended to ensure equal educational opportunity for children
with various types of disadvantages.  For example, the federal
government funds programs specifically targeted to children with
disabilities, poor children, homeless children, and children with
limited English proficiency.  Other federal education programs are
directed not at particular children but at particular topics or
subject areas that are thought to have special national or economic
importance.  Federal teacher training programs, for example, give
priority to math and science instruction.  Through targeted programs,
the federal government also earmarks funds for vocational education
and for integrating technology into the classroom.

Other federal programs and requirements are designed to indirectly
facilitate high-quality education by ensuring that students and
teachers work and learn in a safe environment.  A number of federal
requirements, including environmental mandates and nutrition
requirements for school meals, aim to ensure or improve students'
safety and health.  In addition, those programs that distribute
federal dollars carry a concern with ensuring the integrity of those
funds.  Documentation, spending, and auditing requirements address
these concerns.  Table 2.1 summarizes the types of objectives for
federal programs or mandates and provides examples in each category.

                         Table 2.1

             Program Objectives and Examples of
             Federal Programs and Requirements

Objective           Example of program or requirement
------------------  --------------------------------------
Ensuring equal      The Individuals with Disabilities
educational         Education Act provides financial
opportunity         assistance to school districts and
                    establishes procedures to ensure that
                    students with disabilities receive a
                    free, appropriate public education.

                    The Stewart B. McKinney Homeless
                    Assistance Act provides funding to
                    help states and districts ensure that
                    homeless children have access to
                    public schools.

                    The Bilingual Education program
                    provides funds for school districts to
                    assist students with limited English
                    proficiency, using instructional
                    approaches chosen by the district
                    (including, but not limited to,
                    bilingual education).

Improving quality   The Technology for Education program
in educational      provides funding for schools to
areas with special  upgrade their technology, including
importance          purchasing computers and educational
                    software.

                    The Eisenhower Professional
                    Development program provides money for
                    teacher training, with a special
                    emphasis on math and science.

Guarding against    The Asbestos Hazard Emergency Response
safety and health   Act requires school districts to
hazards             manage asbestos to guard against
                    exposure to harmful asbestos fibers.

                    The Safe and Drug Free Schools and
                    Communities Act provides funding for
                    local school districts' programs to
                    prevent violence and substance abuse.

Protecting the      Federal education programs, including
integrity of funds  Title I, include financial
                    accountability measures that restrict
                    how districts spend federal funds and
                    limit the amount school districts can
                    carry over from one year to the next.

                    The Tax Reform Act of 1986 limited
                    school districts' ability to earn
                    higher rates of interest on the
                    proceeds of bonds they issue under
                    their tax-exempt status.
----------------------------------------------------------

   FEDERAL REQUIREMENTS AFFECT
   SCHOOL DISTRICTS IN THEIR ROLES
   AS EDUCATORS, FOOD SERVICE
   PROVIDERS, EMPLOYERS, AND
   FACILITIES MANAGERS
---------------------------------------------------------- Chapter 2:2

Many people think of school districts only as educators, because
teaching children is their fundamental mission.  However, in addition
to their primary function as educators, school districts also serve
in other roles, many of which are resource-intensive and of great
importance to the community.  For example, in addition to operating
classrooms, schools operate restaurants--most serving lunch and many
serving breakfast.  In one rural school district we visited, the
single school cafeteria served lunch to about 1,000 students each
day--probably more than any other restaurant in the local area.
School districts are also employers of teachers, aides,
administrators, and custodians.  School districts manage one or more
public buildings, which may be used by the community for voting,
adult education, or recreational activities.  In each of these roles
the school district is subject to a variety of federal requirements.

      FEDERAL PROGRAMS INFLUENCE
      HOW DISTRICTS PROVIDE
      EDUCATIONAL SERVICES
-------------------------------------------------------- Chapter 2:2.1

As educators, districts receive funding from the federal government
and in return must follow program requirements.  The largest federal
education programs provide financial assistance to many school
districts, although the programs target specific student populations.
For example, in school year 1997-98 about 89 percent of the school
districts in the United States received funding from the Title I
program, which helps school districts finance programs to assist
disadvantaged students, particularly in reading and math.  Along with
financial assistance, federal programs come with requirements
concerning which students or what subject areas are to be targeted,
what records must be kept, and how school districts are allowed to
spend federal dollars.  Title I requirements specify a formula for
how funds must be distributed to schools within a district.
Similarly, Perkins Act programs, which support vocational education,
require school districts to give priority in allocating funds to
sites or programs that have higher concentrations of students with
disabilities, economically or educationally disadvantaged students,
and students with limited English proficiency.  Federal regulations
also require school districts (and other recipients of federal funds)
to keep records of equipment purchased with federal funds and to
submit to an annual financial audit in accordance with the Single
Audit Act.

The different education programs vary in the extent to which they
prescribe and restrict school districts' use of federal funds.  For
example, the Safe and Drug Free Schools program is often considered a
flexible program; within the broad guidelines established by the
statute, school districts are free to develop their own programs.  In
contrast, the Individuals With Disabilities Education Act (IDEA)
specifies several procedures school districts must follow in
providing educational services to children with disabilities.  Under
IDEA, districts must assess a student's need for additional services;
for each student, create an Individualized Education Program (IEP)
that details the support services the student will receive; offer
services in accordance with the IEP; review each child's IEP annually
and revise it as appropriate; and reevaluate the child's need for
special education services as appropriate, but at least once every 3
years.\9

Other federal requirements also affect how school districts provide
educational services, even though they are not associated with any
specific federal program.  For example, even if a school district
does not receive funds under federal bilingual education programs,
the district is still required by federal civil rights law to provide
meaningful access to education for students with limited English
proficiency.

--------------------
\9 For more information about the varying degrees of flexibility
within grant programs, see Grant Programs:  Design Features Shape
Flexibility, Accountability, and Performance Information
(GAO/GGD-98-137, June 22, 1998).

      SCHOOL DISTRICTS RECEIVE
      FEDERAL ASSISTANCE UNDER
      FOOD SERVICE PROGRAMS
-------------------------------------------------------- Chapter 2:2.2

School districts also receive federal assistance in their role as
food service providers.  In fiscal year 1997, nearly 94,000
schools--including almost 99 percent of public schools--chose to
participate in the National School Lunch program, serving an average
of more than 26 million lunches daily.  Nearly 68,000 schools
participated in the National School Breakfast program, serving an
average of 6.9 million breakfasts every day in fiscal year 1997.
Under these federally funded child nutrition programs, school
districts receive cash assistance based on the number of meals they
serve and the number of low-income children who are served free or
reduced-price meals.\10 Schools also receive additional federal
support in the form of agricultural commodities such as meats, fruits
and vegetables, and dairy products.  About 17 percent of the total
dollar value of the food served in the school lunch program is
provided through commodities.

In return for this federal support, schools must provide free and
reduced-price meals to children from low-income families and ensure
that the meals meet federal nutrition standards.  Children from
families with incomes at or below 130 percent of the poverty level
are eligible for free meals.  Children from families with incomes
between 130 and 185 percent of the poverty level are eligible for
reduced-price meals.\11 In addition, as of school year 1996-97,\12
schools must serve meals which meet several nutrition requirements
established in the 1990 Dietary Guidelines for Americans, including
limiting total fat to 30 percent of calories and limiting saturated
fat to less than 10 percent of calories.  School lunches must also
provide at least one-third of the Recommended Dietary Allowances of
protein, calcium, iron, vitamin A, and vitamin C; school breakfasts
must provide at least one-quarter of these levels.\13

--------------------
\10 In school year 1997-98, the federal reimbursement rates were:
$1.89 for each free lunch served; $1.49 for each reduced-price lunch;
$0.18 for each full-price lunch; $1.045 for each free breakfast;
$0.745 for each reduced-price breakfast; and $0.20 for each
full-price breakfast.  Some schools in the school breakfast program
may qualify for a higher reimbursement rate (the "severe need" rate)
if a specified percentage of their breakfasts are served free or at a
reduced price.  Higher rates for both breakfast and lunch are also
paid to schools in Alaska and Hawaii.

\11 Schools may charge no more than $0.30 for a reduced-price
breakfast and up to $0.40 for a reduced-price lunch.

\12 State agencies may authorize some schools to delay implementation
to a later date, but not later than school year 1998-99.

\13 Compliance with the nutrition standards and the calorie levels is
determined by averaging lunches or breakfasts over a school week.

      LIKE OTHER EMPLOYERS, SCHOOL
      DISTRICTS ARE SUBJECT TO
      WORKER PROTECTION
      LEGISLATION
-------------------------------------------------------- Chapter 2:2.3

School districts are generally subject to the same workplace
regulations as other employers.  For example, antidiscrimination laws
generally apply to school districts as well as to private businesses.
Like other employers, school districts are generally prohibited from
discriminating against employees because of race, color, religion,
sex, or national origin by Title VII of the Civil Rights Act;
similarly, the Age Discrimination in Employment Act prohibits
discrimination against workers aged 40 and over.  In addition, under
the Americans With Disabilities Act (ADA) and section 504 of the
Rehabilitation Act, school districts are prohibited from
discriminating on the basis of disability and required to provide
reasonable accommodation to an employee with a disability.\14

Other worker protection legislation also applies to teachers and
other school district workers.  Although school districts are
specifically exempt from the Occupational Safety and Health Act, some
states require school districts to adhere to certain workplace safety
standards.  In addition, school districts are generally required to
provide unpaid leave under the Family and Medical Leave Act,\15 and
to follow the minimum wage, child labor, and overtime provisions of
the Fair Labor Standards Act.\16 In addition to these federal
requirements, many school districts are governed by collective
bargaining agreements that may also establish policies affecting
compensation, overtime, and workplace conditions.  In school year
1993-94, an estimated 64 percent of all public school districts had a
collective bargaining agreement with a teachers' union or
organization.\17

--------------------
\14 A reasonable accommodation is one that will enable the individual
with a disability to perform the necessary work without imposing an
undue hardship on the employer.  For example, a reasonable
accommodation for an individual in a wheelchair might be to raise his
or her desk so that the wheelchair can fit comfortably beneath it.
For more information, see People With Disabilities:  Federal Programs
Could Work Together More Efficiently to Promote Employment
(GAO/HEHS-96-126, Sept.  3, 1996); and Persons With Disabilities:
Reports on Costs of Accommodations (GAO/HRD-90-44BR, Jan.  4, 1990).

\15 Special provisions in the law allow school districts to play a
role in scheduling unpaid leave for teachers and other instructional
staff.

\16 For more information about workplace regulation, see Workplace
Regulation:  Information on Selected Employer and Union Experiences
(GAO/HEHS-94-138, vols.  I and II, June 30, 1994).

\17 This overall percentage masks sharp differences by region--in the
Northeast, 98 percent of districts had a collective bargaining
agreement, compared with only 12 percent in the South.

      IN MANAGING THEIR
      FACILITIES, SCHOOL DISTRICTS
      MUST COMPLY WITH
      ACCESSIBILITY AND
      ENVIRONMENTAL REQUIREMENTS
-------------------------------------------------------- Chapter 2:2.4

As managers of public facilities, school districts are responsible
for ensuring that these facilities are accessible to people with
disabilities.  Under ADA and section 504 of the Rehabilitation Act,
school districts face accessibility requirements that differ for new
and existing buildings.  For existing buildings, school districts
must operate their programs so that, when viewed in their entirety,
the programs are accessible to individuals with disabilities.  The
law does not require a school district to retrofit each of its
existing facilities to make them fully accessible to individuals with
disabilities.  However, a more stringent standard applies to new
construction and to certain renovations of existing facilities; these
buildings must be readily accessible and useable by individuals with
disabilities and must comply with design standards.\18

School districts also must comply with certain environmental
standards where they are applicable.  For example, AHERA required
school districts to inspect schools for asbestos, to draw up an
asbestos management plan that identifies where asbestos is located in
the schools, and to reinspect schools every 3 years to ensure that
asbestos materials have not become damaged.\19 Similarly, to protect
groundwater from contamination, school districts that operate
underground storage tanks (UST) must comply with federal and state
safety requirements.  Certain USTs are required to meet EPA
requirements for spill protection and corrosion prevention; owners of
affected USTs must upgrade their tanks to meet these standards by
December 22, 1998.\20 If a UST is found to have a leak, the owner may
also be required to take action to prevent further contamination of
the soil.  Additional requirements may govern school districts'
disposal of hazardous materials (for example, chemicals from a high
school science lab).  Other environmental requirements may also apply
to school districts.  For example, one district we visited found that
the well used by one school violated EPA standards, and a new well
was dug to replace it.

--------------------
\18 For more information on school districts and accessibility
requirements, see School Facilities:  Accessibility for the Disabled
Still an Issue (GAO/HEHS-96-73, Dec.  29, 1995).

\19 Asbestos-containing material is generally safe as long as it is
intact or encapsulated.  However, when asbestos-containing materials
become worn or damaged, they may discharge dangerous asbestos fibers
into the surrounding air.

\20 These standards generally apply to USTs over 110 gallons in
capacity that contain petroleum products.  Tanks used to store
heating oil that is used on the premises of the tank are exempt.
Residential USTs are also exempt.

   FEDERAL FUNDING ACCOMPANIES
   MANY MAJOR FEDERAL REQUIREMENTS
   BUT DOES NOT FULLY SUPPORT MOST
   PROGRAM ACTIVITIES
---------------------------------------------------------- Chapter 2:3

Of the 36 major federal programs or legislative mandates in our
review,\21 over half carry some federal funding.  Programs that
directly support instructional activity (such as Title I and Safe and
Drug Free Schools) carry some federal dollars, as do the child
nutrition programs that support school food service programs.
Programs and requirements less directly related to the educational
role of the school district, however, are less likely to provide
direct financial assistance.  Employment-related requirements, for
example, do not provide financial support; and environmental
requirements generally come without financial assistance.  Indirect
federal support--especially in the form of information and technical
assistance--is often provided for many federal programs and mandates,
whether or not direct financial assistance is also provided.  For
example, EPA has published documents to provide information on UST
requirements, and the federal Department of Education provides
support for technical assistance, mainly through state agencies.

For many major programs, federal financial contributions do not fully
fund the activities these programs support.  Federal dollars account
for a relatively low share of total education spending (about 7
percent in school year 1995-96), while state and local funds account
for about 47 and 46 percent, respectively.\22 \23 Although reliable
information on local expenditures for specific program areas is
scarce, the available figures show similar results.  For example, the
Department of Education has estimated that in the early 1990s, in 24
states, about $13.9 billion was spent annually to provide services to
children with disabilities under IDEA, yet federal funds accounted
for only 7 percent of these costs.  In our 1993-94 survey of school
districts, the average amount of federal funding school districts
reported receiving for vocational education equaled only 11 percent
of the average amount of funding districts reported receiving from
state and local sources.\24

Similarly, one of the large districts we visited received $695,242 in
federal bilingual education funds but budgeted about $30 million for
bilingual education instruction.  Food service programs appear to be
an exception to this overall pattern, being fully or nearly fully
funded by federal dollars; a research study found that in school year
1992-93, the federal reimbursement rate for a free lunch under the
National School Lunch program was approximately equal to the median
cost of producing a school lunch.\25

Although it is clear that the cost of many education activities
exceeds the overall federal contribution, the precise size of this
gap is difficult to determine for specific areas or requirements.
Little information is available on the true cost of many education
and education-related activities that are supported with federal
funds.  Even at the level of the local school district, it is usually
difficult to determine exactly how much has been spent on different
educational activities such as "regular" classroom instruction,
special education, dropout prevention, assistance to students with
limited English proficiency, and so forth.  Some of the districts we
visited set up their budgets to provide such program-specific
information, but others did not.  When districts do generate their
budgets on a program-specific basis, their definitions and methods of
classifying expenses may be inconsistent with those of other
districts, making comparisons across districts often difficult and
sometimes impossible.

These difficulties are further complicated by the wide variation in
per pupil spending across school districts.  For example, for the six
districts we visited, the highest-spending district spent over twice
as much per student ($7,804.06) as the lowest-spending district
($3,801.50).  Factors such as district size, geographic differences
in salaries and other expenses, the age and condition of school
facilities, and the composition of the student body (such as the
number of students with disabilities or with limited English
proficiency) can contribute to such differences and make it difficult
to say what level of expenditure is adequate or appropriate for a
particular program.\26

--------------------
\21 For a complete list of these programs and mandates, see app.  I.

\22 Figures for local funds also include revenues contributed by
intermediate units.

\23 Revenues and Expenditures for Public Elementary and Secondary
Education:  School Year 1995-96, U.S.  Department of Education,
Office of Educational Research and Improvement, National Center for
Education Statistics, NCES 98-205 (Apr.  1998).

\24 Vocational Education:  Changes at High School Level After
Amendments to Perkins Act (GAO/HEHS-95-144, July 12, 1995).

\25 Abt Associates, School Lunch and Breakfast Cost Study, prepared
under contract to the Food and Nutrition Service, U.S.  Department of
Agriculture, Oct.  1994.

\26 For more information on differences in spending across school
districts, see Wayne Riddle and Liane White, "Expenditures in Public
School Districts:  Estimates of Disparities and Analysis of Their
Causes," Developments in School Finance 1996, U.S.  Department of
Education, Office of Educational Research and Improvement, the
National Center for Education Statistics, NCES 97-535 (July 1997);
and Disparities in Public School District Spending, 1989-90, U.S.
Department of Education, Office of Educational Research and
Improvement, National Center for Education Statistics, NCES 95-300R
(Feb.  1995).

   STATES OFTEN PLAY A KEY ROLE IN
   REQUIREMENTS AFFECTING SCHOOL
   DISTRICTS
---------------------------------------------------------- Chapter 2:4

Several programs provide funding directly from the federal government
to school districts.  These programs include Impact Aid, which
provides general financial assistance to school districts adversely
affected by federal property or by large numbers of federally
connected children, and Head Start, which provides a broad array of
educational and social services to low-income children through local
agencies (some of which are school districts).  However, 17 of the 23
programs we reviewed that provide federal funding distribute these
dollars through the states.  The largest federal education
programs--Title I and IDEA, which provided $8 billion and $4.8
billion in fiscal year 1998, respectively--distribute their funds
through state education agencies.

The role played by the state agency differs substantially across
various federal programs.  For example, under the Adult Education
program, states have considerable discretion in distributing federal
funds because each state can determine the criteria it will use to
award competitive grants.  In contrast, Eisenhower Professional
Development program funds (which finance teacher training) are merely
passed through the state, with district allocations already
determined by the formula set out in the federal statute.  The role
of the state in program administration also varies.  In the National
School Lunch program, the state plays a key role in selecting and
distributing federal commodities.  For many programs, states play a
key oversight role as well.  Under IDEA, for example, the states
assume a major part of the responsibility for ensuring that school
districts comply with the law's requirements.

For most of the programs we reviewed that provide federal funds,
school districts must submit plans or applications to either the
state or the federal government.\27 These plans or applications
generally contain information on how the funds will be used,
certifications that federally prescribed procedures will be followed,
and assurances that federal funds will be expended in accordance with
the purpose of the program.  For certain programs in some states,
school districts must also request and receive reimbursement from the
state, rather than receiving grant funds up front.

In fulfilling their role as administrators of federal programs, state
governments sometimes place additional requirements on school
districts.  For example, federal requirements allow districts to
purchase equipment costing under $5,000 without separate
documentation; however, in one state we visited, a lower threshold of
$500 had been set by the state government.\28 In cases where a state
requirement arises from the implementation of a federal program or
regulation, it becomes especially hard to distinguish a state
requirement from a federal one.  From the point of view of the local
school district, it may not be important where the requirement
originated because the district must comply in any case.  Staff in
most of the school districts we visited told us that they could not
tell or did not know which requirements were state and which were
federal, and education experts told us that this was probably true of
most districts nationwide.

States have also imposed many requirements on educational programs in
areas unregulated by the federal government, such as curriculum and
teacher certification.  For example, by 1996, 44 states had set
minimum curriculum requirements for high school graduation, 43 states
required districts to offer a half-day or full-day kindergarten, and
46 states established professional development requirements or
continuing education requirements for teachers.  States also specify
a required number of days or hours for the school year.\29

In addition to federal and state requirements, school districts are
also affected by requirements imposed by local governments and by the
courts.  Local requirements such as building codes can affect school
district operations.  Some school districts are also affected by
judicial decisions.  For example, one district we visited had been
required by a court order to fund several programs as a result of a
long-standing desegregation lawsuit.  In the area of special
education, judicial decisions can affect what services the district
provides and which students receive them.

--------------------
\27 For specific information on which federal programs require plans
or applications, see app.  II.

\28 For more information on state requirements and on three states'
efforts to provide more flexibility with respect to state-imposed
requirements, see Regulatory Flexibility in Schools:  What Happens
When Schools Are Allowed to Change the Rules?  (GAO/HEHS-94-102, Apr.
29, 1994).

\29 For more information on state requirements, see Council of Chief
State School Officers, Key State Education Policies on K-12
Education:  Content Standards, Graduation, Teacher Licensure, Time
and Attendance (Washington, D.C.:  Oct.  1996).

IMPLEMENTATION ISSUES RELATING TO
FEDERAL REQUIREMENTS AFFECT HOW
SCHOOL DISTRICTS PLAN, FUND, AND
OPERATE EDUCATIONAL PROGRAMS
============================================================ Chapter 3

School district officials generally expressed support for federal
initiatives, recognizing the importance of such goals as ensuring
equal educational opportunity and protecting children's health and
safety.  At the same time they noted their concerns with
implementation issues that make achieving these goals more difficult.
Rather than focusing on a single federal program or requirement,
these concerns extend to a wide variety of implementation issues that
affect all phases of program and service delivery.  School districts'
key implementation issues include:  (1) the lack of adequate
information on federal requirements and federal funding, which can
make school districts less efficient and less innovative in
implementing federal requirements; (2) program and facilities costs
associated with federal requirements, as well as the administrative
costs associated with federal programs; and (3) the logistical and
management challenges presented by certain federal requirements,
which can make it difficult to meet federally prescribed timelines
and to find the qualified staff or providers to successfully
implement federal requirements.  In confronting this wide variety of
implementation issues, school district officials expressed a desire
for more information, additional funding, and greater procedural
flexibility.

   INFORMATION ON FEDERAL
   REQUIREMENTS AND FUNDING IS
   ESSENTIAL FOR PROGRAM AND
   FINANCIAL PLANNING
---------------------------------------------------------- Chapter 3:1

School district staff need extensive information about federal
requirements and funding allocations.  To do their jobs well,
district administrators need to know the requirements associated with
the various programs, as well as the more broadly applicable
environmental and employment regulations.  Although state agencies
provide technical assistance, district officials reported crucial
information gaps.  The number and complexity of federal requirements,
combined with the challenges posed by staff turnover, make keeping up
with the requirements a challenge for both district and state staff.
Without sufficient information about federal requirements and
funding, school districts may spend funds unnecessarily, lose
opportunities to structure programs to meet local needs, and face
uncertainty that limits their ability to conduct financial planning.

      SCHOOL DISTRICTS OFTEN LACK
      CRUCIAL INFORMATION, DESPITE
      STATE TECHNICAL ASSISTANCE
      EFFORTS
-------------------------------------------------------- Chapter 3:1.1

School district officials need to have detailed knowledge of federal
requirements in order to design educational programs in compliance
with federal laws and regulations and to conduct long- and short-term
financial planning.  However, education experts, school district
staff, and state officials agreed that districts often have
incomplete information about federal requirements.  Because district
officials must comply with numerous federal laws and regulations in a
variety of complex areas--such as special education, nutrition
standards for school meals, and environmental
requirements--maintaining detailed knowledge can be difficult.
District and state officials told us that the large number of federal
laws and regulations often makes it hard to keep informed, especially
as requirements and personnel change.  In addition, the complexity of
certain federal requirements can prove to be a challenge to district
program directors.  For example, one special education director told
us that "you need a law degree and an MBA to understand the special
ed regulations."\30

Although the Department of Education also provides technical
assistance, Department officials told us that it is primarily the
states that face the challenging task of keeping school districts
informed.  Our telephone interviews confirmed that states are the
school districts' primary source of information and technical
assistance; when we asked district officials whom they called first
when they had a question on the Title I or IDEA programs, about 80
percent said that they contacted their state Department of Education.

Staff from 88 percent of the districts we interviewed by telephone
said that the assistance they received from the state Department of
Education was "helpful" or "very helpful." However, school district
officials still faced information gaps that may limit their ability
to implement innovative and cost-effective education and support
programs.  For example, one program director we interviewed told us
that her contact at the state was prompt and accurate in responding
to questions but did not move proactively to provide information,
leaving her unaware of key regulatory provisions and of potential
grant opportunities.  Another program director expressed a similar
concern, and said that it was especially difficult to keep up with
changes in the law without added clarification from state or federal
officials.

State and federal agencies face several challenges in using technical
assistance to address districts' need for additional information.
For example, turnover of key administrative personnel at both the
state and the district level can have a negative impact on the
effectiveness of technical assistance.  A survey conducted by the
Council of the Great City Schools\31 of 49 large urban school
districts found that the average tenure of district superintendents
in these large districts was less than 3 years.  Several education
experts and district officials told us that states also experience
personnel turnover, and as a result some states may face shortages of
knowledgeable staff to provide technical assistance.  In addition,
federal and state officials told us that they sometimes find their
efforts to use information technology (such as the Internet and
e-mail) frustrated by a lack of such technology at the local level.

--------------------
\30 Our results here are consistent with the results of our previous
studies of business's reaction to federal requirements.  In 1996, we
found that companies had difficulty developing a list of regulations
that were applicable to them and that misunderstandings and
misinterpretations may have led companies to incur unnecessary
expenses in complying with federal requirements.  In 1994, we found
that many employers exhibited a lack of awareness and knowledge of
many federal workplace requirements.  For more information, see
Regulatory Burden:  Measurement Challenges and Concerns Raised by
Selected Companies (GAO/GGD-97-2, Nov.  18, 1996), and
GAO/HEHS-94-138, June 30, 1994.

\31 The Council of the Great City Schools is an association of large
urban school districts.

      LACK OF INFORMATION CAN
      IMPEDE DISTRICTS' ABILITY TO
      PLAN AND IMPLEMENT FEDERAL
      PROGRAMS AND LOCAL
      INITIATIVES
-------------------------------------------------------- Chapter 3:1.2

School districts' lack of knowledge may have a major effect not only
on their ability to administer federal programs, but also on their
ability to implement local initiatives to improve teaching and
learning.  School district officials need to know what is required of
them--both financially and programmatically--and what assistance they
will receive.  Without sufficient information on federal requirements
and funding, districts may spend funds unnecessarily, lose
opportunities to structure programs as they desire, and face
uncertainty that limits their financial planning.

Misunderstandings about the scope of requirements may lead school
districts to spend more money than necessary in complying with
federal requirements, particularly in environmental areas.  As a
result, districts may lose the opportunity to use these funds for
other programs designed to achieve key local objectives.  For
example, the superintendent in one district we visited told us that
district officials did not know what to do about asbestos in the
schools; in retrospect he believed that the district might have been
able to save some money if they had had more detailed knowledge about
the asbestos requirements at the time.  An official from another
district told us that officials had not fully understood all the
requirements they had to follow when renovating their gymnasium; if
they had known about all the regulations before issuing the bond to
pay for the renovation, they would have tried to raise more money,
she added.  Similarly, an EPA official told us that a lack of
knowledge may lead some districts to spend more than necessary to
comply with the requirements on USTs.

With incomplete information, district officials may interpret federal
requirements in very conservative and narrow ways, believing they
have less flexibility than they actually do.  Limited knowledge may
lead some district officials to mistake long-standing practice for
legal requirement, making them more reluctant to adopt new
educational initiatives.  As a result, districts may lose the
opportunity to structure programs as they would like.  One district
program coordinator told us that when she is not absolutely sure of
the requirements, she tends to be cautious "even if somebody at the
Department of Education told me it's OK." Similarly, a state official
said that "lots of mandates are perceived, not actual" because often
local school districts do not understand what is required or how much
flexibility they actually have.

In addition to needing information on what is required, district
staff also need to know how to use available flexibility mechanisms
(such as waivers) to assist them in improving educational programs.
According to district staff, federal officials, and other education
experts, some districts are not fully aware of the flexibility
provisions available to them.  Moreover, in 1997 the Department of
Education's Inspector General reported that many districts had
insufficient information to take advantage of flexibility provisions
such as waivers and consolidated planning.\32 The Inspector General's
results are consistent with some districts' responses to our
questions.  For example, one district superintendent responded to our
question about federal waivers by saying, "I just never thought it
was possible."

Finally, even when district staff have a good understanding of
federal requirements, they also need accurate and timely information
on the funding they will receive.  District superintendents and
program directors expressed frustration with the lack of timely
information on federal funding allocations.  According to these
officials, by the time the Congress appropriates the funds, the
federal agencies allocate the money to the states, the states
allocate money to the districts, and the funds are made available to
the district, the district staff have only a brief window of
opportunity to plan their programs and make their purchases.  For
example, in one district we visited, the district budget that was
distributed to school and central office staff carried a warning that
changes were possible because information on the coming year's
federal allocations was not available.  An official from this
district told us that some federal grant funds are sometimes received
very late, causing the district to cut purchases of textbooks and
other supplies.  Several district-level program directors we
interviewed advocated multiyear funding as a way of reducing the
uncertainty of the funding process.

--------------------
\32 See U.S.  Department of Education, Office of Inspector General,
State and Local Education Agencies Need More Technical Assistance to
Take Full Advantage of the Flexibility Provisions of Title XIV of the
Improving America's Schools Act, No.  04-70001 (Aug.  1997).

   SCHOOL DISTRICTS SUPPORT
   PROGRAM PURPOSES BUT CITE
   LIMITED FUNDS TO ADMINISTER
   PROGRAMS AND IMPLEMENT FEDERAL
   REQUIREMENTS
---------------------------------------------------------- Chapter 3:2

School district officials generally agreed with the purposes and
goals associated with many federal programs and requirements,
including special education and environmental requirements.  However,
they also expressed concern about both the program costs and the
administrative costs of implementing federal laws and regulations.
Program costs in areas such as special education, environmental
requirements, accessibility, and nutrition standards greatly exceed
federal assistance, according to school district officials.  In
addition, district staff told us that the eligibility determination
processes and accounting and reporting requirements associated with
federal programs can contribute to a heavy administrative load.  To a
lesser extent, some district officials viewed federal restrictions on
raising or spending funds as an issue.

      DISTRICT OFFICIALS EXPRESSED
      SUPPORT FOR GOALS OF FEDERAL
      REQUIREMENTS
-------------------------------------------------------- Chapter 3:2.1

Many school district officials we interviewed expressed their support
for the purposes underlying certain federal requirements.  This
widespread support extended to all types of program objectives,
including equal educational opportunity and improving instructional
quality as well as safety and financial integrity.  District staff's
support for federal objectives included not only programs with
substantial funding but also requirements where funding is not
provided.  Special education directors told us that students with
disabilities had benefited a great deal from special education.
Officials from several districts also said that they believe
restrictions on how districts spend federal funds were appropriate
and necessary to prevent fraud and abuse.  One district official,
explaining why he believes targeting and spending restrictions are
necessary, told us, "When $11 billion is left on a tree stump I know
what happens." In another district, the facilities manager told us
that various environmental requirements (such as those related to
asbestos and other chemical hazards) were necessary to protect health
and safety.  Some district staff also agreed with the goal of
promoting better nutrition in school meals.

      ALTHOUGH DISTRICTS SUPPORT
      SPECIAL EDUCATION, THEY
      REPORT THAT PROGRAM COSTS
      GREATLY EXCEED FEDERAL
      ASSISTANCE
-------------------------------------------------------- Chapter 3:2.2

Although district officials generally agreed with the need to provide
a quality education to children with disabilities, they also
expressed concern about the cost of providing these services,
especially in the context of limited federal support.  District
superintendents and special education directors identified a variety
of factors as major contributors to the higher costs of special
education:  (1) the large number of students who require special
education, (2) a few students whose very severe conditions require
extensive care and support, (3) a lack of assistance from other
parties (such as insurers and other public agencies) in providing
related services, and (4) the costs of litigation and procedural
issues.  These same elements are frequently mentioned in the special
education literature,\33 although research to measure the impact of
each of these factors has not yet been conducted.

First, in many districts a large number of students require special
education and related services.  In the 50 states and the District of
Columbia, about 4.8 million students aged 6 to 17 were served under
IDEA in the 1995-96 school year.  This amounts to approximately 10.6
percent of all students in that age group.  However, this percentage
can vary considerably across school districts and across states.  For
example, across states the percentage of students aged 6 to 17 served
under IDEA ranged from 7.6 percent in Hawaii to 14.85 percent in
Massachusetts.  In one district we visited, over 20 percent of
students were receiving special education.

Second, although many students with disabilities are fully integrated
into regular classrooms and require little additional support, a few
children with severe disabilities require more extensive--and more
expensive--support and care.  For example, in one district we
visited, the special education director told us that the annual cost
of caring for two autistic children in the district amounted to
approximately $150,000, and four other students with psychiatric
disorders were being served at a cost of about $38,000 each.  State
officials and staff from other districts also pointed to similar
high-cost cases as an important factor in the cost of special
education.

Third, some district staff told us--and state officials
confirmed--that districts sometimes had difficulty obtaining
financial assistance from public agencies and private insurers for
related services (especially health services) they provided to a
student with a disability.  Under IDEA, the school district is
obligated to provide a �free appropriate public education" to any
student with a disability, including both special education and
�related services." �Related services� are defined under IDEA as
services that may be required to help a child with a disability
benefit from special education, including transportation,
speech-language pathology and audiology services, physical and
occupational therapy, social work, counseling, and medical services.
Similarly, assistive technology (such as special computer software, a
plastic device to assist in holding a pencil, or other items) may be
needed to help the student participate in school.  Because many
related services are health-related or medical in nature, they may be
covered under private health insurance policies or under Medicaid,
the government insurance program that provides health care to poor
families.  In addition, other related services (such as counseling or
mental health care) may fall within the purview of other state
agencies such as the Department of Mental Health or Social Services.
However, some school district officials reported that they had
difficulty obtaining assistance or reimbursement from these other
sources.  Even when assistance could be obtained, we were told, it
was ofetn insufficient to meet the costs.  One district official told
us that obtaining funds from Medicaid and other health insurers was
�an unbelievable nightmare.� In its 1997 reauthorization of IDEA, the
Congress specified that other public agencies should provide services
within their purviews and required states to establish an interagency
agreement or other mechanism to establish which agency is financially
responsible for which services and to otherwise coordinate between
agencies.  However, it is too soon to determine the impact of this
provision on local school districts.

Finally, school district and state officials identified dispute
resolution--especially litigation--as a contributing factor to
special education costs.  According to district officials, the
possibility of litigation not only creates legal costs, but also can
make school districts more cautious and less innovative in dealing
with special education issues.  As one district official told us,
�You always call the lawyer first on any special education-related
issue.� The superintendent in another district said that a single due
process hearing could cost his district around $8,000 to $10,000 in
legal fees and salary costs, regardless of the outcome.  The special
education director in that district also expressed concern about
legal costs.  He added that because of the high cost of litigation,
he does not believe that he can refuse parents' requests, even when
he believes they are unreasonable.  Despite these anecdotal reports
of high costs, however, disability advocates often view litigation as
necessary to prod some school districts into providing necessary and
required services.  One disability advocate we interviewed said that
some school districts simply will not provide services �until they
are called on it.�

--------------------
\33 For a summary of this literature, see Nineteenth Annual Report to
Congress on the Implementation of IDEA, U.S.  Department of Education
(1997); and Stephen Chaikind, Louis C.  Danielson, and Marsha L.
Brauen, �What Do We Know About the Costs of Special Education?  A
Selected Review,� The Journal of Special Education, 26 (4) (1993),
pp.  344-70.

      ENVIRONMENTAL AND FACILITIES
      REQUIREMENTS ARE OFTEN
      VIEWED AS BOTH BENEFICIAL
      AND COSTLY
-------------------------------------------------------- Chapter 3:2.3

District staff expressed support for environmental requirements
designed to ensure the safety of students and staff; however, some
also worried about the cost of making these needed improvements.
When discussing funding issues, many district officials mentioned the
need to abate or remove asbestos when renovating, remodeling, or
repairing school buildings.  Asbestos abatement can be costly, even
in the context of a remodeling project.  For example, when one
district we visited remodeled two buildings in 1991, asbestos removal
cost the district a total of $174,376.  In another district we
visited, district staff told us that they had to postpone repairs to
one school's roof because they could not afford the cost of removing
the current roof, which contains asbestos.  In our 1994 survey on
school facilities, schools reported having spent an average of
$43,000 on asbestos in the previous 3 years; furthermore, schools
reported needing to spend an average of $71,000 over the next 3 years
on asbestos.\34

Asbestos abatement issues will continue to present school districts
with difficult and often expensive financial choices, as more schools
are remodeled or modernized.  School enrollments are growing; at the
same time, many of America's schools are in poor condition, needing
not only repair but additional space to accommodate modern
instructional techniques like alternative student assessments.\35
Finally, as we reported in 1995,\36 many schools need to put in place
the building infrastructure needed to support information technology,
including electrical wiring, conduits/raceways for computer cables,
and additional electrical outlets.  As a result, many school
districts will be faced with asbestos abatement expenses as they
prepare to modernize their aging buildings.

Incomplete implementation of existing requirements may also compound
schools' difficulties with asbestos.  For example, an EPA study
estimated that only 16 percent of the original AHERA inspections were
�thorough inspections�; the remaining 84 percent of inspections
failed to either accurately identify, quantify, or record the
location of asbestos-containing material in the school.\37 As a
result, a school or district that relied on its AHERA plan to avoid
disturbing asbestos might experience asbestos problems in areas it
could not or did not anticipate.  In addition, federal officials
expressed concern that because of lack of communication, turnover in
personnel, or other reasons, school or district officials might fail
to adequately review their AHERA plan before beginning remodeling
work, and as a result they might encounter asbestos-related problems.

In some districts, staff also mentioned the difficulty in absorbing
the cost of upgrading or removing USTs.  Representatives from
education associations also cited USTs as an expense that poses
problems for some school districts.  The cost of upgrading USTs can
vary considerably depending on a number of factors, including the
condition of the soil, labor costs in the area, type of upgrade,
length of downtime, and when the upgrade is done (upgrades done
closer to the December 22, 1998, deadline for compliance are expected
to be more expensive).  EPA has estimated that upgrading a three-tank
system may cost from about $13,000 to $20,000, while permanently
closing a UST may cost roughly $5,000 to $11,000.

Staff in five of the six districts we visited, as well as some of the
districts in our phone survey, told us that making buildings
accessible for people with disabilities was a major expense.  Staff
from one urban district told us that the cost of making all
facilities fully accessible would be �astronomical,� and it had been
"a strain" to find funds to meet the current accessibility
requirements (which do not require making all buildings accessible).
The business manager in another district told us that not only were
the accessibility renovations costly, but that maintaining equipment
such as wheelchair lifts was also expensive.  Their comments are
consistent with the results of our December 1995 study on school
accessibility.\38 About 56 percent of the schools we surveyed for
that study believed that they would need to spend some money in the
coming 3 years (1995-1998) to improve accessibility.  In addition, 53
percent of schools in the survey reported having incurred
expenditures in the previous 3 years (1991-1994) to improve
accessibility.  According to the survey results, schools across the
country could have been expected to spend about $5.2 billion on
accessibility in the 1995 to 1998 period.  Like the district staff we
interviewed, school officials in that study reported that many
schools were not made accessible because of a lack of funding.

--------------------
\34 The median figures for asbestos spending were considerably lower:
$5,500 for spending in previous years and $10,000 for needed spending
in the next 3 years.  For more information, see School Facilities:
America's Schools Report Differing Conditions (GAO/HEHS-96-103, June
14, 1996).

\35 One special education director told us that the growing number of
students in special education--and smaller class sizes in special
education classes--also created a need for more space.

\36 See School Facilities:  America's Schools Not Designed or
Equipped for 21st Century (GAO/HEHS-95-95, Apr.  4, 1995).

\37 See Asbestos in Schools:  Evaluation of the Asbestos Hazard
Emergency Response Act (AHERA):  A Summary Report, EPA, Office of
Toxic Substances, EPA 560/4-91-012 (June 1991).

\38 See GAO/HEHS-96-73, Dec.  29, 1995.

      SOME FOOD SERVICE DIRECTORS
      CONCERNED ABOUT COST OF
      IMPLEMENTING NUTRITION
      STANDARDS
-------------------------------------------------------- Chapter 3:2.4

Despite their general support for the goal of improving the
nutritional value of school meals, some district staff also told us
that they believe the new nutrition standards have increased or will
increase their costs.  According to a study conducted by the
Department of Agriculture, the nutrition standards can be implemented
without increasing the cost of the meals.\39 However, several food
service directors we interviewed disagreed.  They told us that
training staff in new methods of food preparation has been
time-consuming and challenging.  Additionally, we were told that some
items that used to be made in-house (like salad dressing) were
replaced with more expensive commercial versions to meet the new
federal standards that limit the fat content of school meals.  The
potential magnitude of this issue is still unclear, however, as many
districts are still in the relatively early stages of implementing
these requirements.

--------------------
\39 See Federal Register, June 10, 1994, vol.  59, no.  111, pp.
30218-30251, and Federal Register, Jan.  27, 1995, vol.  60, no.  18,
pp.  5514-5528.

      FOR CERTAIN TARGETED
      PROGRAMS, ELIGIBILITY
      DETERMINATION CAN BE
      RESOURCE-INTENSIVE FOR MANY
      DISTRICTS
-------------------------------------------------------- Chapter 3:2.5

Several of the largest federal programs for school districts are
targeted to a particular group, such as students with disabilities or
students from low-income families.  Although this program design
allows federal dollars to be directed to those students most in need,
it also requires school district staff to determine which students
are eligible for assistance.  School district staff described
eligibility determination under two of these federal programs as
particularly challenging, but for very different reasons.  District
officials viewed eligibility determination for school lunch and
breakfast programs as challenging (despite efforts to help streamline
the process), mainly because of the volume of paperwork that must be
processed within a short period of time.  For special education, the
challenge in determining eligibility rests with the individualized
nature of an eligibility process that often requires detailed reviews
by various professionals.

         SCHOOL LUNCH AND
         BREAKFAST PROGRAMS
------------------------------------------------------ Chapter 3:2.5.1

A major challenge in administering federally funded food service
programs comes at the beginning of the school year, when school and
district staff must identify which students are eligible for free and
reduced-price meals.  In five of the six districts we visited, more
than 25 percent of district children are eligible for free and
reduced-price meals.  Every one of the food service directors in
these districts identified eligibility determination as a major
challenge.  Superintendents and other officials from school districts
in our telephone interviews also commented on the difficulty and
expense involved in determining eligibility for free and
reduced-price meals, although they continued to participate in the
child nutrition programs.

Students are eligible for free or reduced-price lunches and/or
breakfasts on the basis of income and family size.  This program
structure, while allowing federal dollars to be targeted to those
students most in need, requires school district staff to determine
which students are eligible for assistance.  At the beginning of the
year, school districts generally distribute applications to school
children and their families.  Once applications are returned by the
parents, district staff process the applications to determine a
child's eligibility.  Some district officials told us that because of
pride or privacy concerns, some students and parents (particularly at
the high school level) do not return applications even if they know
they are eligible.  To ensure that only eligible students receive
benefits, the school district is also required to verify income
information for a sample of applications.  Once eligibility
determinations have been made, district officials must notify the
parents and then incorporate the eligibility information into the
district's food service system.  All of this processing takes place
at the beginning of the school year, a very busy period for all
school staff.

Food service staff at the districts we interviewed used two
strategies to try to limit the work created by this application
process.  First, districts used a process called �direct
certification� to quickly identify and enroll a portion of eligible
students.  Under direct certification, students from families that
receive food stamps or public assistance can be certified as eligible
for free or reduced-price meals.  Data from public assistance records
is matched with school files, obviating the need for parents to fill
out applications and for district staff to process the forms.

All of the districts we visited used direct certification, and the
food service directors were grateful for the opportunity to use this
streamlined process.  However, district officials added that while
direct certification was helpful, they still faced an administrative
challenge in processing applications.  Because many families who
qualify for free or reduced-price meals do not receive public
assistance or food stamps, district officials must gather and process
data on a large number of families who cannot be enrolled through
direct certification.  For example, in one district we visited,
district officials could use direct certification to enroll only
about 31 percent of eligible students; for the remaining 69 percent,
the district had to distribute, collect, and process applications.

Second, some districts have also used a more sweeping strategy to
reduce the costs associated with eligibility determination--a
universal service or no-fee option.  Under these options, schools
serve lunches and/or breakfasts to all students at no charge,
regardless of whether their family income would qualify them for a
free meal.  Districts are reimbursed based on the number of
qualifying students for the year before they began serving no-fee
meals.  At the end of the 3-to-5-year program period, districts must
generally redetermine students' eligibility to provide a new,
up-to-date basis for reimbursement.

Under universal or no-fee service, districts reduce the
administrative costs associated with determining eligibility and with
counting and claiming meals by reimbursement category.  However, the
cost of the meals increases as the district pays for meals served to
students who would not otherwise be eligible for free meals.  In
addition, with all meals served for free, more students may eat in
the cafeteria rather than bring lunch from home, further increasing
the cost of the food service program.  For any one district, total
costs may increase or decrease depending on the strength of these
factors.  Two of the districts we visited had one or more schools
participating in these programs recently, and they reported different
experiences.  In one district we visited, the no-fee approach was in
place at several schools, and district officials told us that
universal feeding had lowered their total costs while allowing them
to serve more children.  In contrast, the food service director in
another district reported that they had experimented with universal
programs in two schools but discontinued the initiative because the
total costs of operating the programs increased at both schools.\40

--------------------
\40 In both these districts, schools in the universal program had at
least 80 percent of students eligible for free and reduced-price
meals.  As we noted in our testimony on the pilot program that
preceded the current universal options, for the program to be cost
effective a school needs to have a large number of students who
qualify for free and reduced-price meals.  See Food Assistance:
Early Results of USDA's No-Fee School Meal Pilot Program
(GAO/T-RCED-94-184, Apr.  14, 1994).

         SPECIAL EDUCATION
         PROGRAMS
------------------------------------------------------ Chapter 3:2.5.2

Eligibility determination for special education can also be a
resource-intensive process, according to school district officials.
Staff in over half (53 percent) of the districts we surveyed by
telephone said that eligibility determination for special education
posed challenges for the district.  According to district officials,
the individualized nature of determining eligibility for special
education allows students with disabilities to have educational
programs tailored to their specific needs.  However, precisely
because eligibility and program decisions must consider each child's
unique situation, it is difficult for school districts to streamline
the process.

Under IDEA, a child is eligible for special education services if he
or she is �a child with a disability�--that is, a child who needs
special education and related services because of mental retardation,
hearing impairments, speech or language impairments, visual
impairments, emotional disturbance, orthopedic impairments, autism,
traumatic brain injury, learning disabilities, or other health
impairments.\41 To help determine eligibility, school districts may
obtain expert opinions from various professionals, including doctors,
child psychologists, social workers, and others.  These professionals
may either be on the school district staff or work as independent
contractors, but in any case are paid by the school district.  If a
child's parents are not satisfied with the school district's
evaluation, they have the legal right to have another evaluation done
by independent professionals, at the school district's expense.

Once a child is determined eligible for special education, a decision
must be made about what services and supports the child needs.  Each
child must have an Individualized Education Program (IEP) that
describes the child's educational performance, the goals for the
child in the coming year, and the special educational and support
services the child will receive to help meet these goals.  The IEP is
developed--and must be agreed to--by an �IEP team.� By federal law,
the IEP team must include the parents of the child; at least one of
the child's regular education teachers, if the child is or may be
participating in a regular classroom; at least one special education
provider; and a representative of the school district.  The parents
or district staff may also invite other individuals to participate.
States may impose additional requirements on the composition of the
IEP team.  For example, Massachusetts requires that, for an older
student who may need continuing services outside the school system, a
representative from an agency that provides adult services be invited
to the IEP meetings at least 2 years before the anticipated exit
date.  The IEP must be reviewed each year and revised as appropriate
by the IEP team, and students must be reevaluated for eligibility at
least once every 3 years.

This highly individualized process allows students with disabilities
to have educational programs tailored to their specific and unique
needs.  However, school district superintendents and special
education directors told us that this process comes at a high price
in terms of time and money.  For example, prior to the 1997
amendments to IDEA, school districts were not required by federal law
to have a regular classroom teacher participate in the development of
the IEP.  Many district officials told us that implementing this new
requirement would be difficult and costly, primarily because
substitute teachers must be hired to take over classroom duties when
regular teachers are attending IEP meetings during normal school
hours.

Staff from some school districts also told us that, in their
opinions, the IDEA definition of eligibility is unclear or too
subjective, making eligibility determination more difficult.  For
example, one special education director told us that in his
experience, almost any child who is referred for an evaluation
concerning emotional disturbance is given that diagnosis.  Officials
from other districts echoed this concern with respect to emotional
disturbance and disability in general, especially when possible
disability diagnoses are raised in the context of a student's
inappropriate conduct.

The definition of disability in general, and the subcategories of
emotional disturbance and learning disability in particular, have
been controversial.  Some have advocated a relatively narrow
definition that would emphasize well-understood conditions, while
others have recommended a wider definition to encompass less
prevalent and less well-defined, but also potentially debilitating,
conditions.  Researchers and other experts in varying disciplines
often disagree on definitions of disability and related conditions,
and the prevalence of certain conditions varies.\42 The ambiguity and
subjectivity surrounding this process is a source of confusion and
frustration for some district officials.

--------------------
\41 States and school districts are allowed (but not required) to
also consider a child eligible for special education if that child is
3 to 9 years of age and experiencing developmental delays in
physical, cognitive, communication, social or emotional, or adaptive
development and therefore is judged to need special education and
related services.

\42 For more information on these controversies, see G.  Reid Lyon,
�Learning Disabilities,� in �Special Education for Students with
Disabilities,� The Future of Children, 6 (1) (Spring 1996), pp.
54-76; Equal Educational Opportunity and Non-Discrimination for
Students with Disabilities:  Federal Enforcement of Section 504, U.S.
Commission on Civil Rights, Equal Educational Opportunity Project
Series, Vol.  II (Sept.  1997); and Judith D.  Singer and others,
�Variation in Special Education Classification Across School
Districts:  How Does Where You Live Affect What You Are Labeled?�
American Educational Research Journal, 26 (2) (Summer 1989), pp.
261-81.

      FOR SOME DISTRICTS,
      ACCOUNTING AND REPORTING
      REQUIREMENTS ADD TO
      ADMINISTRATIVE LOAD
-------------------------------------------------------- Chapter 3:2.6

Districts' administrative resources must also be used to meet federal
accounting and reporting requirements.  Officials from 49 percent of
the districts in our telephone interviews identified at least one
program's accounting and reporting requirements as problematic or
challenging, as did staff in three of the districts we visited.  Many
of the comments reflected a general dissatisfaction with having to do
the paperwork to comply; however, some school district staff also
raised other issues.  Some staff members were frustrated by
duplication and inconsistency in accounting and reporting
requirements across programs.  Others expressed the opinion that
existing accounting and reporting requirements were not sufficiently
focused on program results.

Staff at the districts we visited provided specific examples of
accounting and reporting requirements they found particularly
difficult.  Many of these requirements originated at the state level,
not from federal laws or regulations.  For example, officials from
districts in one state mentioned a requirement that equipment
purchases over $500 be documented separately when paid for with
federal funds.  Federal regulations allow for equipment purchases up
to $5,000 without additional documentation, but states can impose
more stringent requirements (as this state did).  A finance director
in a district in another state told us that his state had once had
the same requirement but had recently raised the threshold to the
federal limit of $5,000.  This one change, he said, saved the
district a great deal of time and trouble.

In addition, both state and school district officials told us that
auditing and reporting requirements sometimes lag behind federal and
state initiatives to provide additional flexibility to school
districts.  For example, one school district official told us that
although the law allows a school to combine federal funds and apply
these funds to the entire school under the �schoolwide program�
provisions of Title I, state auditors still required separate
accounting of funds.

      STAFF FROM A FEW DISTRICTS
      WERE DISSATISFIED WITH
      RESTRICTIONS ON RAISING AND
      SPENDING FUNDS
-------------------------------------------------------- Chapter 3:2.7

Staff in a few districts identified issues related to spending and
raising funds as a concern.  For example, officials from several
districts criticized certain provisions of the Tax Reform Act of
1986.  These provisions are designed to prevent state and local
governments from selling tax-exempt bonds at a low interest rate and
then investing the money to earn a higher interest rate rather than
spending it on local projects.  One district official told us that
the tax provisions not only decrease revenues but may also cause
districts to spend the funds more hastily, leading to poorer project
decisions.  Other district staff talked about restrictions on
spending funds; they told us they would like more flexibility in how
they could use federal dollars.  However, not all district officials
we interviewed felt this way.  One Title I director, for example,
said that he supports the provision in Title I that earmarks funds
for parental involvement activities because this requirement is �a
spur that makes things happen.�

   CERTAIN FEDERAL REQUIREMENTS
   CAN CREATE LOGISTICAL AND
   MANAGEMENT CHALLENGES FOR
   SCHOOL DISTRICTS
---------------------------------------------------------- Chapter 3:3

In addition to the direct financial impact of federal requirements,
district officials also identified several other types of challenges
associated with operational requirements.  These nonfinancial issues
include logistical challenges in meeting federal timelines,
challenges in finding qualified and capable staff or providers to
implement programs or requirements, and management challenges in
balancing competing goals or needs.

      PROCEDURAL TIMELINES
      DESIGNED TO ENSURE
      COMPLIANCE CAN ALSO
      COMPLICATE PROGRAM LOGISTICS
-------------------------------------------------------- Chapter 3:3.1

To ensure that special education students receive the help they need
in a timely manner, school districts are subject to procedural
timelines.  For example, districts are required to hold the IEP
meeting within 30 days after the student's eligibility has been
established.  After the IEP meeting, the district must provide the
agreed-upon services �within a reasonable period of time.� (The
Department of Education has stated that it views a period of 60 days
from the date of evaluation as �reasonable� in most cases, although
this interpretation does not have the force of law.) Districts are
also required to review each student's IEP annually and to reassess
each student's eligibility once every 3 years.  Other procedural
timelines govern the district in disciplining special education
students and in changing the student's placement (whether for
disciplinary or other reasons).\43

These timelines can protect students with disabilities by ensuring
that they receive the services they are promised.  A representative
from a disability advocacy group told us that some school districts
resort to �stalling� rather than provide agreed-upon services.
Similarly, one school district official stated that in the past, not
enough had been done to ensure that evaluations were done in a timely
manner.

District officials also told us, however, that these timelines
sometimes create logistical problems for them.  For example, some
district staff viewed the 60-day time frame for conducting
evaluations as unrealistic or difficult.  The complex nature of the
evaluation process and limited staff (especially in small districts
and in rural areas) may contribute to the difficulty.  For example,
one special education director in a small rural district told us that
there was only one child psychologist in the area.  When this person
became ill, the district was unable to meet its timelines.  Staff
from several districts we visited (and others we interviewed by
telephone) told us that the fixed time periods were too rigid and
that they would prefer to have more flexibility.

--------------------
\43 Many special education directors and district superintendents
also mentioned a particular one-time deadline:  the time frame given
to update students' IEPs in accordance with the 1997 IDEA amendments.
The Department of Education's proposed regulations would have
required school districts to have completed updating all students'
IEPs in compliance with the 1997 amendments by July 1, 1998.  Several
school districts we visited, and others we interviewed by phone,
viewed this deadline as unreasonable; and the Department of Education
has decided to allow a longer implementation time frame.  For more
information, see Individuals With Disabilities Education Act:  School
Districts' Response to Regulatory Deadline (GAO/HEHS-98-156, Apr.
22, 1998).

      PERSONNEL SHORTAGES CAN MAKE
      COMPLIANCE MORE DIFFICULT
      AND MORE COSTLY
-------------------------------------------------------- Chapter 3:3.2

Successfully implementing federal programs can be more difficult when
a school district faces a shortage of qualified personnel.  For
example, in one state, staff from several school districts,
especially in rural areas, told us that they had a difficult time
finding certified special education teachers.  In some states
(including Colorado, New York, and Louisiana) 15 to 28 percent of
special education teachers are not fully certified.  Some rural
districts may also have difficulty finding providers of certain
related services such as physical therapy and speech pathology,
according to district and state officials.  Similarly, in a
Department of Education study, over one-quarter of schools reported
that it was very difficult or impossible to fill vacancies for
bilingual or ESL teachers.\44

Several district officials and association representatives also cited
difficulties in obtaining qualified environmental contractors, again
particularly in rural or outlying areas.  The facilities manager in
one district we visited told us that because there are few qualified
asbestos contractors in the area, these contractors have little
competition and can charge high prices.  Similarly, EPA has warned
owners and operators of USTs that the number of qualified contractors
is limited.

--------------------
\44 See Schools and Staffing in the United States:  A Statistical
Profile, 1993-94, U.S.  Department of Education, Office of
Educational Research and Improvement, National Center for Education
Statistics (July 1996).

      DISTRICT OFFICIALS CONCERNED
      ABOUT OTHER OPERATIONAL
      REQUIREMENTS
-------------------------------------------------------- Chapter 3:3.3

Some district officials expressed concern that certain federal
requirements do not match the needs of their communities.  These
superintendents and district program directors stated that certain
federal requirements sometimes supersede established local practices;
as a result, they believe they are less able to balance competing
educational goals.

         DISCIPLINING SPECIAL
         EDUCATION STUDENTS POSES
         SPECIAL CHALLENGES
------------------------------------------------------ Chapter 3:3.3.1

The most frequently cited example of such a requirement concerns
certain provisions of IDEA that limit districts' ability to
discipline special education students by removing them from the
classroom.  These provisions are designed to prevent districts from
denying a free and appropriate public education to a student because
of behavior that is related to the student's disability.  As stated
in the proposed regulations implementing the 1997 amendments to IDEA,
school districts may freely remove a student with a disability from
the classroom for up to a total of 10 days in a school year.  If a
school district wants to remove a child with a disability from the
classroom for a cumulative total of more than 10 days in a school
year, the district generally must reconvene the IEP team.\45 The
district has somewhat more latitude in cases involving weapons or
illegal drugs.  If a student with a disability carries a weapon or
illegal drugs to school, the district may move the student outside
the school to an alternative educational setting (such as a special
program for troubled youth) for up to 45 days.  However, if the
district invokes this rule, it must also reconvene the IEP team.  In
addition, if the student's parents object to the district's action,
the parents have the right to take the district to a due process
hearing.

These procedural protections may apply not only to students who have
an IEP in place but also to some students who have not yet been
declared eligible for special education.  A student who has not been
determined eligible for special education may be entitled to IDEA's
procedural protections if the school district had knowledge of the
child's potential eligibility.  If the child's parents have expressed
concern in writing, the behavior or performance of the child
demonstrates the need for special education, or district personnel
have expressed concern about the child's performance or behavior,
then the district is presumed to have had knowledge of the child's
potential eligibility.

School district officials told us that they find discipline issues to
be very challenging because of the need to carefully balance the
rights and needs of the child with a disability against the rights
and the needs of the other children for a safe and disciplined
environment.  Some superintendents and special education directors
stated that they believe the federal rules are too rigid, reducing
their ability to strike this delicate balance.  The expense, time,
and trouble of going through hearings could deter district officials
from disciplining students with disabilities, we were told.  One
special education director told us that, in effect, �you cannot
discipline these kids, period.� As a result, staff from several
districts told us that the IDEA rules created a double standard
because students with disabilities are treated differently from
students who are not labeled as disabled.

For these reasons, district officials expressed concern that the
requirements are potentially unfair, could lead to morale problems
among staff, and could send the wrong message to both students with
disabilities and their peers.  For example, one special education
director told us that it is very hard for him to explain to parents
of other students that students with disabilities have procedural
rights that their children do not, even for identical offenses.  In
another district, the superintendent told us about an incident where
a student attacked and injured another child and also threatened the
classroom teachers, an aide, and the superintendent.  Finally, the
school called the police.  The police and the district attorney
recommended that the student be kept off campus.  To implement that
recommendation, the district had to have an administrative hearing,
rewrite the student's IEP, and provide homebound instruction for the
student.

--------------------
\45 The district can also ask a hearing officer for permission to
place the child in an alternative setting for 45 days.

         FOOD SERVICE DIRECTORS
         CONCERNED ABOUT STUDENT
         ACCEPTANCE OF MEALS UNDER
         NUTRITION STANDARDS
------------------------------------------------------ Chapter 3:3.3.2

Some food service directors told us that they were concerned about
their ability to balance the goal of serving nutritious meals with
the goal of serving meals that children will eat and enjoy.  Staff
told us that they feared the new nutrition requirements would result
in less food being consumed by students--because either more students
would bring lunch from home or (more commonly) larger amounts of food
would be discarded (plate waste).  One food service director stated
that �we're supposed to implement something here that they [the
students] don't get at home.� Although it is too soon in the
implementation process to determine if these effects are occurring on
a wide scale, the concern may be well founded.  In our 1996 survey of
school cafeteria managers, the foods with the highest percentage of
plate waste were fruits and vegetables.  More than half of the middle
and high school cafeteria managers believed that increasing the
amounts of fruits and vegetables in school meals--as many districts
would do to meet the nutrition requirements--would increase plate
waste.  Similarly, cafeteria managers reported that increasing the
number of servings for bread and grains would increase plate
waste.\46 \,\47

--------------------
\46 Regulations published in 1995 modified the meal pattern
requirements by increasing the portion sizes for fruits/vegetables
and for breads/grains according to grade level.  The Healthy Meals
for Children Act (P.L.  104-149, May 29, 1996) modified the National
School Lunch Act to allow school food authorities to use the meal
pattern in effect for the 1994-95 school year.  The use of this meal
pattern allows schools to continue to use serving sizes for
fruits/vegetables and for breads/grains that were in effect prior to
the 1995 regulations.

\47 See School Lunch Program:  Cafeteria Managers' Views on Food
Wasted by Students (GAO/RCED-96-191, July 18, 1996).

RECENT FLEXIBILITY INITIATIVES ARE
GENERALLY NOT STRUCTURED TO
ADDRESS THE MAJOR IMPLEMENTATION
ISSUES AFFECTING SCHOOL DISTRICTS
============================================================ Chapter 4

Responding to calls for greater flexibility in education programs,
the Congress and the Department of Education have implemented several
initiatives to give school districts more freedom in designing
programs and using federal funds.  These efforts�waivers, schoolwide
programs, financial flexibility provisions, and consolidated
planning�have expanded districts' options within covered programs and
requirements.  However, the narrow scope of these initiatives
precludes them from addressing the key information, financial, and
operational issues identified by school district officials.

   RECENT INITIATIVES WERE
   DESIGNED TO PROVIDE GREATER
   FLEXIBILITY TO SCHOOL DISTRICTS
---------------------------------------------------------- Chapter 4:1

Since 1994, the Congress and the Department of Education have
implemented several efforts to provide additional flexibility to
school districts.  Waivers�temporary exemptions from certain specific
federal requirements�can allow districts to suspend some program
rules.  Several provisions allow school districts additional
flexibility in the use of federal funds.  Under a consolidated
planning process, school districts can submit one plan or funding
application that covers several federal programs, rather than prepare
separate documents for each program.  Some of these flexibility
initiatives have been used infrequently, and their use varies
considerably across states.

      WAIVERS AVAILABLE FOR SOME
      FEDERAL PROGRAMS AND
      REQUIREMENTS
-------------------------------------------------------- Chapter 4:1.1

In an attempt to provide states and local school districts increased
flexibility, the Congress authorized the Department of Education to
grant waivers---temporary exceptions to a limited number of federal
requirements.  States and school districts can ask the Department to
waive certain specific federal requirements when necessary to support
local efforts to raise student achievement.  The Department can waive
certain requirements of (1) ESEA, which contains several key
education programs, including Title I; (2) the Perkins Act, which
funds vocational education; and (3) the General Education Provisions
Act (GEPA) and the Education Department General Administrative
Regulations (EDGAR), which contain regulations (such as recordkeeping
standards) that apply to education programs in general.  In
requesting a waiver, school districts are required to describe how a
waiver would allow them to improve students' academic performance.

Under the Education Flexibility Partnership Program (Ed-Flex), the
Department of Education has delegated to 12 states\48 a portion of
its authority to waive certain federal requirements.  In these
states, school districts generally apply to their state education
agency for waivers of federal requirements instead of to the U.S.
Department of Education.  However, states and school districts in
non-Ed-Flex states may also request similar waivers.  Instead of
these waivers being approved at the state level, the waivers are
approved at the federal level through the Department of Education.\49

The authority to grant waivers is limited to specific education
programs.  Although these include several of the major education
programs (including Title I), other important programs are omitted.
For example, although the Department can waive some requirements of
the Safe and Drug Free Schools program, it cannot waive any of the
requirements of IDEA.  Similarly, while the Department can grant
waivers under the Eisenhower Professional Development program,
programs such as Adult Education and Goals 2000 are excluded.  In
addition, the Department cannot waive any of the requirements that
lie within the purviews of other federal agencies.  As a result,
these waivers do not cover environmental requirements, employment
requirements, or the requirements of the food service programs.

Even within covered programs, many of the requirements that relate to
key federal objectives cannot be waived.  For example, waivers are
not permitted for any federal education requirement relating to (1)
health and safety, (2) civil rights, (3) maintenance of effort, (4)
comparability of services, (5) the equitable participation of
students in private schools, (6) parental participation and
involvement, or (7) the distribution of funds to state and local
education agencies.  In addition, waivers are not permitted if
granting a waiver would undermine the purposes of the federal
legislation; and for many programs, certain restrictions might be
considered an integral part of the program's purpose.

In its September 30, 1997, report to the Congress, the Department of
Education reported that it had received relatively few waiver
requests from school districts.  According to the report, the
Department received 375 waiver requests from school districts from
school year 1994-95 until just before school year 1997-98.  This
represents less than 3 percent of school districts in the nation.
Similarly, Ed-Flex states granted relatively few waivers during the
first 2 years of the project.

Of the waivers that have been granted, nearly two-thirds (64 percent)
have concerned two Title I issues.  The most frequent use of waivers
(43 percent) has been to allow school districts to change the way
they distribute Title I dollars to schools within the district.\50

Waivers of these targeting restrictions have allowed some districts
to provide extra funding for efforts to improve poor-performing
schools; waivers of targeting provisions have also allowed districts
to continuously fund schools in cases where poverty rates are
relatively similar, rather than shifting funds from school to school
from year to year.  Districts have also used waivers to expand school
eligibility for schoolwide programs (21 percent).  Schoolwide
programs allow individual schools to combine their Title I funds with
other federal dollars (such as funds from IDEA and Perkins Act
vocational education programs) to implement a plan to improve
instruction in the whole school, rather than targeting Title I funds
to specific children who are thought to be at risk.

--------------------
\48 The 12 Ed-Flex states are Colorado, Illinois, Iowa, Kansas,
Maryland, Massachusetts, Michigan, New Mexico, Ohio, Oregon, Texas,
and Vermont.

\49 For more information on the Ed-Flex program, see Education
Programs:  Information on the Ed-Flex Demonstration Project
(GAO/HEHS-98-61R, Dec.  15, 1997).

\50 Title I specifies a complex formula for how funds must be
distributed to schools within a school district.  For example,
districts are generally required to provide funding to all schools
with a poverty rate of above 75 percent before the district funds any
school with a poverty rate below 75 percent.

      SEVERAL INITIATIVES ARE
      DESIGNED TO INCREASE
      FINANCIAL FLEXIBILITY
-------------------------------------------------------- Chapter 4:1.2

In recent years, several provisions have been undertaken to provide
school districts with more flexibility in using federal funds:  (1)
increased use of schoolwide programs, (2) consolidation of
administrative funds, (3) the "unneeded funds" provision, and (4) the
Cooperative Audit Resolution and Oversight Initiative (CAROI).  Each
of these provisions is designed to give school districts more freedom
to apply federal funds according to their needs, within a limited set
of federal programs.

Some district and state officials told us that schoolwide programs
can offer greater flexibility and have helped improve schools.
However, not all schools are eligible to participate in schoolwide
programs, and some eligible schools choose not to.  According to
Department of Education estimates, of the approximately 53,000 Title
I schools in the United States, about 22,000 are eligible for
schoolwide programs, and about 15,000 of these have chosen to
participate.  Under current law, a Title I school is eligible for
schoolwide status only if at least 50 percent of the children
enrolled in the school or residing in the school attendance area are
from low-income families, or if it has received a waiver.  Not all
eligible local schools and districts endorse or use schoolwide
programs; some prefer to target their Title I funds to those children
they believe are at greatest risk.  For example, one Title I director
told us that in his district many schools do not use schoolwide
programs because they believe their programs are working well as
currently structured.

Other financial flexibility provisions are more narrowly designed and
less frequently used.  For example, for certain federal programs
school districts are allowed (with the approval of the state
education agency) to consolidate the administrative funds available
to the district under certain federal programs.  School districts
using this provision can combine the funds set aside for district
administration under separate federal programs and apply them to the
district's cost of administering this group of programs, rather than
applying each funding source only to the administrative costs for
that one program.  This provision applies to only six programs:
Title I, Migrant Education, Eisenhower Professional Development
grants, Technology for Education, Safe and Drug Free Schools, and
Innovative Education Program Strategies (Title VI).  Other programs,
such as Even Start, IDEA, and Goals 2000, are not included.  In
practice, this provision is frequently unavailable and seldom used.
In our survey of state education agencies, about one-third reported
that they did not allow local school districts to consolidate
administrative funds.  Further, even when this alternative was
allowed, many school districts elected not to use it.  In about
two-thirds of the states that offered the option, less than 10
percent of districts chose to use the provision.

A similar provision, called the "unneeded funds" provision, allows
school districts, with the approval of their state education agency,
to shift up to 5 percent of funds across certain federal programs:
Migrant Education, Eisenhower Professional Development grants,
Technology for Education, Safe and Drug Free Schools, and Innovative
Education Program Strategies (Title VI).\51 Other programs, such as
Perkins Act, IDEA, and Emergency Immigrant Education, are not
included.  As with consolidation of administrative funds, the
"unneeded funds" option is often unavailable and seldom used.  In our
survey of the 50 state education agencies, only about half the states
reported that they allowed local school districts to take advantage
of the "unneeded funds" provision.  Further, even when this
alternative was offered, it was rarely used.  In about two-thirds of
the states that offered the option, no school districts used it; of
the states where it was allowed, in only one did more than 10 percent
of districts use the provision.

Finally, the Department of Education created CAROI in response to
concerns from state and district administrators that the manner in
which the Department conducted its audits and other monitoring
activities might conflict with the recent focus on providing
additional flexibility.  The Department's proposal brief states that
CAROI should allow the Department to conduct its audit process in a
more flexible, useful, and cooperative fashion, and to more
efficiently resolve audit findings so as to promote better program
performance.  However, because this initiative has not yet been fully
implemented, its impact on school districts is uncertain.

--------------------
\51 Districts may use the "unneeded funds" provision to shift funds
into Title I, but cannot shift funds from Title I to any of the other
covered programs.

      UNDER CONSOLIDATED PLANNING
      PROCESS, DISTRICTS MAY
      SUBMIT ONE FUNDING
      APPLICATION FOR SEVERAL
      FEDERAL PROGRAMS
-------------------------------------------------------- Chapter 4:1.3

To obtain funding for certain federal programs, school districts must
submit plans or applications to either the state or the federal
government.\52 These plans or applications generally contain
information on how the funds will be used, certifications that
federally-prescribed procedures will be followed, and assurances that
federal funds will be spent in accordance with the purpose of the
program.  However, district officials and education experts expressed
concern that the fragmented nature of the application process is not
only unnecessarily resource-intensive but also might impede program
coordination.  In recent years, the Congress, the federal Department
of Education, and the states have attempted to improve the planning
and application process for federal programs.  States and school
districts are now allowed (and in some cases required or encouraged)
to submit consolidated plans--that is, to submit one plan that covers
two or more covered federal programs.

In our survey of state education agencies, 24 states said that they
require school districts to submit consolidated plans when applying
for federal education program funds.  Consolidated plans were most
often required to include four programs:  (1) Title I, (2) the
Eisenhower Professional Development program, (3) Safe and Drug Free
Schools, and (4) Innovative Education Program Strategies (Title VI).
In addition, some states also require school districts to include
other programs, such as the Perkins Act vocational education
programs, in the consolidated plan.  Where consolidated plans are not
required, states generally give the school districts the option of
choosing consolidated or separate plans.

Districts' use of consolidated plans varied substantially across
states.  A few states told us that all districts submitted only
separate plans, while others reported that all districts submitted
consolidated plans.  In our telephone survey, districts expressed
varying preferences for consolidated or separate plans.  Staff in 46
percent of districts said they preferred consolidated plans, 34
percent said they preferred separate plans, and 20 percent had no
preference.  The reaction was similar in the districts we visited.
The program directors and superintendents that preferred consolidated
plans often stated that consolidated plans helped promote program
coordination.  However, others that favored separate plans said that
they prefer to keep a more detailed focus on individual programs.

--------------------
\52 Of the 36 major federal programs that we reviewed, 18 required
school districts to submit a plan or application.  For information on
the funding process for these programs, see app.  II.

   FEDERAL FLEXIBILITY INITIATIVES
   HAVE LIMITED APPLICABILITY TO
   THE KEY ISSUES AFFECTING SCHOOL
   DISTRICTS
---------------------------------------------------------- Chapter 4:2

Federal flexibility initiatives are generally not structured to
address the information, funding, and management issues school
districts identified as their primary concerns.  Waivers, schoolwide
programs and financial flexibility provisions, and consolidated
planning neither provide information on federal requirements nor
reduce districts' need for such information.  These provisions do not
increase federal assistance to school districts, nor do they relieve
districts of any of their major financial obligations.  Several of
these efforts may help districts reduce their administrative costs,
but not in those administrative areas that districts identified as
key concerns.  Similarly, the major flexibility initiatives do not
extend to the requirements that posed logistical and management
challenges for school districts.  As a result, the federal efforts to
provide additional flexibility to school districts have limited
applicability to those areas that concern district officials the
most.

      FLEXIBILITY INITIATIVES
      INCREASE DISTRICTS'
      INFORMATIONAL NEEDS
-------------------------------------------------------- Chapter 4:2.1

Although information-related issues are of key concern to school
district officials, the recent flexibility initiatives increase the
amount of information districts need, rather than simplify or
streamline information on federal requirements.  Federal flexibility
initiatives do not provide school districts with additional
information.  Furthermore, because they are not applicable across the
range of federal requirements, flexibility initiatives cannot
streamline or simplify the information on federal programs.  Instead,
these efforts actually expand the amount of information school
district officials need.  To take advantage of the flexibility
provisions, district officials must know that the provisions exist
and learn how to use them.  Gathering this information can be
difficult, even if the provisions are relatively simple to use once
this information has been obtained.  Because these initiatives are
program-specific, and each initiative applies to a different set of
programs, superintendents and program directors must contend with a
complicated set of legislative provisions.

Moreover, information on federal flexibility initiatives may be hard
to find.  In 1997, the Department of Education's Inspector General
reported that many states had not provided guidance to school
districts on financial flexibility provisions.  Similarly, we found
that information concerning federal requirements and flexibility
initiatives is often missing from state education agencies' Internet
web sites.  As shown in table 4.1, of the 50 web sites maintained by
the state Departments of Education, only 7 provided information
concerning federal waivers, only 2 provided information on the
"unneeded funds" provision, and only 20 provided information on
consolidated planning.  Similarly, many states did not provide any
guidance on the implementation of Title I and IDEA---the largest
federal education programs and the focus of many school district
concerns.

                         Table 4.1

             Number of State Education Agencies
          Providing Information on Their Internet
                         Web Sites

                                     Number of states that
                                provide information on the
                               topic on their Internet web
Topic                                                 site
----------------------------  ----------------------------
Federal waivers                                          7
State waivers                                           19
Consolidated planning/                                  20
 application
Consolidation of                                         5
 administrative funds
"Unneeded funds" provision                               2
Title I                                                 24
IDEA                                                    33
A link to the U.S.                                      34
 Department of Education
----------------------------------------------------------

      FLEXIBILITY INITIATIVES CAN
      DO LITTLE TO ALLEVIATE
      DISTRICTS' CONCERNS ABOUT
      PROGRAM AND ADMINISTRATIVE
      COSTS
-------------------------------------------------------- Chapter 4:2.2

Federal flexibility initiatives neither provide more money nor
relieve districts' major obligations.  Although school districts
cited the limited nature of federal financial assistance as a key
issue, flexibility initiatives do not increase the flow of federal
funds to school districts.  Additional program funds would have to be
appropriated from a Congress that, like school districts, must
allocate scarce funds among competing worthy objectives.  In
addition, because these flexibility efforts do not make fundamental
changes in the requirements of federal programs and mandates, school
districts continue to be responsible for providing required services.
None of the requirements that school districts cited as especially
costly--special education, environmental requirements, accessibility,
or nutrition standards--can be reduced or eliminated under any of the
federal flexibility initiatives.  For example, waivers cannot be used
to suspend federal requirements relating to health and safety or
civil rights.  Similarly, although IDEA and Title I funds can be
combined and used to support a schoolwide program, the school
district is still responsible for providing the appropriate services
to disadvantaged and disabled children.  As a result, flexibility
efforts cannot address school districts' concerns about substantial
program costs in the face of limited resources.

Similarly, flexibility efforts can have only limited impact on school
districts' administrative costs.  District superintendents and
program directors identified two areas--eligibility determination for
certain targeted programs and accounting and reporting
requirements--as major contributors to the administrative cost of
implementing federal requirements.  None of the recent initiatives
was specifically designed or intended to address these key concerns.
Because federal flexibility efforts are limited to a few programs,
these initiatives are not able to address problems that arise outside
these programs' parameters.  For example, because neither food
service nor IDEA is covered, waivers can do nothing to assist school
districts in streamlining the time-consuming and costly eligibility
determination process for these programs.  The narrowness of the
flexibility provisions can also hamper districts' efforts to address
administrative issues that cut across many federal programs and
requirements.  For example, some district officials expressed
frustration with the duplication and inconsistency in accounting and
reporting requirements across federal programs.  Waivers would be
unable to address these concerns because no requirements can be
waived for many of these programs (including IDEA, food service, and
Goals 2000).  Similarly, the consolidation of administrative funds
can take place only under a few programs.

While they do not address districts' key concerns, waivers and
consolidated planning may help some districts streamline processes in
other administrative areas.  For example, some district staff told us
that the consolidated planning and application process takes less
staff time than is required to file separate applications for each
federal program.  Similarly, Texas has granted several statewide
waivers under the Ed-Flex program that are specifically designed to
reduce paperwork at the district level.  In addition, the
Department's plans to improve its auditing process may prove helpful
in aligning the auditing process with the current focus on program
flexibility.

Although only a few districts expressed dissatisfaction with
restrictions on spending and raising funds, several flexibility
initiatives--schoolwide programs, the "unneeded funds" provision, and
consolidated administrative funds--are designed (at least in part) to
address these issues.  However, these flexibility measures can have
only limited impact because not all districts can participate, and
even for those that do, sometimes only minor changes are allowed.
For example, many states do not allow districts to use the
consolidated administrative funds or unneeded funds provisions.  Even
when districts use these flexibility measures, their impact may be
small.  For example, the unneeded funds provision allows districts to
shift only 5 percent of federal program funds across programs.  With
federal funds generally accounting for a small percentage (7 percent
overall) of total education expenditures, the amount of funding
covered under this provision is likely to be very small.  For one
large urban district we visited, the unneeded funds provision could
allow district officials to shift $42,513 from one program to
another--this out of about $54 million in federal funds and a total
district budget of $491.5 million.  For smaller districts, the
provision may be even less significant.

      LOGISTICAL AND MANAGEMENT
      CHALLENGES REMAIN DESPITE
      FEDERAL EFFORTS TO INCREASE
      FLEXIBILITY
-------------------------------------------------------- Chapter 4:2.3

The restricted scope of flexibility initiatives also precludes them
from addressing several of the logistical and management issues that
school districts identified as key issues, such as procedural
timelines for evaluating the needs of special education students and
finding qualified personnel to implement key federal programs.
Because the flexibility initiatives do not extend to IDEA
requirements, districts cannot use these provisions to address their
concerns with timelines.  In addition, the federal government is not
positioned to reduce the shortages of special education teachers,
bilingual or ESL teachers, or qualified environmental contractors.
Consequently, districts must rely on their own resourcefulness to
overcome the management challenges they face in these areas.

CONCLUSIONS
============================================================ Chapter 5

For several decades the federal government has provided guidance and
financial support to state and local education systems.  This
assistance has frequently taken the form of targeted programs and
mandates designed to advance a variety of federal goals (such as
ensuring equal educational opportunity).  Recently, however,
teachers, parents, and the Congress have emphasized education reform
initiatives with the broader and more challenging goal of improving
education for all students.  Although this emphasis on overall
outcomes has enjoyed widespread support, controversy has arisen over
the role existing federal programs and mandates will play in
achieving this broad purpose.  Some individuals--both educators and
legislators--believe that loosening or eliminating some federal
requirements will enable local school districts to direct more
resources to the classroom and to adopt more innovative instructional
approaches.  However, others have expressed concern that the purposes
underlying federal programs (such as ensuring equal educational
opportunity) could be compromised if federal requirements are
loosened or eliminated.  As the education reform movement has
accelerated, interest in providing additional flexibility has
heightened in both the executive and legislative branches.

Some of school districts' key concerns--particularly the amount of
financial assistance provided to school districts--lie beyond the
scope of the flexibility initiatives that have been implemented to
date.  Alleviating these concerns may require more than providing
additional flexibility within the existing federal program structure.
Other key concerns, including informational and procedural issues,
could be partially or fully addressed in the context of flexibility,
although current initiatives are not targeted toward these issues.
Our findings on school districts' experiences with federal
requirements and regulatory flexibility suggest four lessons to be
considered in refining existing federal initiatives and designing new
ones.

1.  School districts' concerns are wide ranging rather than centered
on a single program or issue.  To address these concerns
successfully, federal initiatives must also be multifaceted.

School districts expressed a wide range of concerns, covering
numerous federal programs and reflecting a broad variety of
implementation issues.  These issues extend to all facets of
providing educational and support services--from planning educational
programs at the beginning of the year to auditing the accounts at
year's end.  Although much of the public debate on education reform
has focused on procedural and financial flexibility, such as easing
restrictions that govern the use of funds, district superintendents
and program directors identified obtaining better information,
streamlining eligibility determination and other administrative
processes, and obtaining more procedural flexibility as key issues.
Because the implementation issues school districts face cut across
program and agency lines, initiatives that are narrowly focused can
at best provide only limited assistance.  Although it may be
difficult to design, a broader flexibility initiative (or set of
initiatives) that is simple to understand and easy to use, extended
across related programs, and widely applicable to many school
districts would be better positioned to address districts' concerns.

2.  School districts need--and many lack--adequate information to
successfully implement federal requirements and take advantage of
flexibility options.  Strengthening the knowledge base will be key to
the success of both current and future flexibility efforts.

As complex organizations, school districts face a large and
complicated body of federal requirements that affect many operational
areas.  According to district officials, the volume and complexity of
federal requirements make it difficult to keep track of what is
needed to comply and what flexibility is available.  With inadequate
information, district staff may be more conservative in their
interpretation and less innovative in their approach.  In addition,
district officials cannot take advantage of flexibility mechanisms if
they don't know what flexibility is available or how to apply it to
their programs.  Experience with various flexibility
initiatives--from federal and state waivers to consolidated
planning--suggests that increasing awareness among district officials
is a crucial factor in how frequently these provisions are used and
how helpful they are to school districts.

3.  Because states play a key role in overseeing and administering
federal programs, in order for flexibility initiatives to succeed,
state education agencies must be able and willing to help school
districts implement them.

For local school districts, state education agencies are the main
source not only for information and technical assistance but also for
monitoring and oversight.  In addition, states impose their own
requirements on school districts.  Some of these, such as teacher
certification standards, may interact with federal requirements but
are not associated with specific federal programs.  Others, such as
requirements concerning IEP forms, arise out of the state's role in
administering federal programs.  Because state requirements are
stricter than federal ones, initiatives to loosen federal
requirements may not have the desired impact unless related state
requirements are also modified.  As a result, federal legislation
alone may be insufficient to create regulatory flexibility that
reaches down to the local level.

4.  The Congress and the Department of Education face potential
conflicts between local officials' desire for flexibility and the
important purposes underlying federal programs and mandates.

District officials recognized the benefits of federal requirements to
students, parents, and educators.  Requirements that students with
disabilities receive the additional help they need to achieve in
school were widely supported, as were many health and safety
requirements.  Educators and advocates alike have expressed concern
that the opportunity to achieve these goals could be lost if too many
federal requirements are loosened or lifted.  The Congress and the
Department of Education may sometimes face a tension between
providing flexibility and still ensuring equal educational
opportunity, promoting high quality education, guarding against
health and safety hazards, or protecting the integrity of federal
funds.  In education, where such outcomes are often difficult to
identify and measure, it may be especially difficult to ensure that
these goals are realized without procedural requirements.
Consequently, in some program areas federal authorities may choose to
provide local officials with less discretion than they may desire.

DESCRIPTIVE INFORMATION ON MAJOR
FEDERAL LAWS AND PROGRAMS
=========================================================== Appendix I

                                                   How school          Which school
Law or                                             districts are       districts are
program      Citation    Agency    Purpose         affected            covered
-----------  ----------  --------  --------------  ------------------  ------------------
Education
-----------------------------------------------------------------------------------------
Adult        20 U.S.C.   Educatio  To improve      Provides financial  All school
Education    1201-1213   n         adult literacy  support to states   districts are
                                   skills.         and local           eligible to apply;
                                                   organizations       program
                                                   (including school   requirements apply
                                                   districts) for      only if school
                                                   adult education     district receives
                                                   programs.           funds.

Bilingual    20 U.S.C.   Educatio  To educate      Provides financial  All school
Education    7401-7491   n         students with   support for local   districts are
                                   limited         organizations       eligible to apply;
                                   English         (including school   program
                                   proficiency to  districts) to       requirements apply
                                   meet the same   provide programs    only if school
                                   rigorous        to assist students  district receives
                                   standards for   with limited        funds.
                                   academic        English
                                   performance     proficiency.
                                   expected of
                                   all children.

Carl D.      20 U.S.C.   Educatio  To help         Provides funding    All school
Perkins      2302-2471   n         prepare         to school           districts are
Vocational-                        students to     districts for       eligible to apply;
Technical                          work in a       vocational          program
Education                          technologicall  education programs  requirements apply
Act                                y advanced      at the high school  only if school
                                   society by      level. (Also        district receives
                                   giving them     supports            funds.
                                   needed          vocational
                                   academic and    programs at
                                   occupational    postsecondary
                                   skills          institutions, such
                                   technology.     as community
                                                   colleges.)

Eisenhower   20 U.S.C.   Educatio  To assist in    Provides financial  All school
Professiona  6601-6702   n         the training    support to states   districts are
l                                  and             and school          eligible to apply;
Development                        professional    districts for       program
State                              development of  teacher training,   requirements apply
Grants                             teachers,       with priority       only if school
(Title II)                         especially in   given to math and   district receives
                                   math and        science.            funds.
                                   science.

Emergency    20 U.S.C.   Educatio  To ensure that  Provides funding    Only school
Immigrant    7541-7549   n         high-quality    to school           districts with 500
Education                          education is    districts that      immigrant children
Program                            provided to     experience large    (or 3 percent of
(Part C of                         immigrant       increases in        the student
Title VII)                         children and    student enrollment  population,
                                   to help these   due to              whichever is less)
                                   children        immigration.        are eligible to
                                   transition                          receive funds.
                                   into American                       Program
                                   society.                            requirements apply
                                                                       only if school
                                                                       district receives
                                                                       funds.

Even Start   20 U.S.C.   Educatio  To help break   Provides financial  School districts
Family       6361-6370   n         the cycle of    support to          that form a
Literacy                           poverty and     partnerships of     partnership
programs                           illiteracy by   school districts    agreement with a
                                   improving the   and other           community-based
                                   educational     organizations to    organization or
                                   opportunities   operate family      institution of
                                   of low-income   literacy programs.  higher education
                                   families                            are eligible to
                                   through                             apply for funds.
                                   unified family                      Program
                                   literacy                            requirements apply
                                   programs.                           only if school
                                                                       district receives
                                                                       funds.

Gifted and   20 U.S.C.   Educatio  To help meet    Provides funding    All school
Talented     8031-8037   n         the needs of    to school           districts that are
programs                           gifted and      districts for       carrying out
                                   talented        programs for        programs for
                                   students.       gifted and          gifted and
                                                   talented students.  talented students
                                                                       are eligible to
                                                                       apply (as are
                                                                       states and higher
                                                                       education
                                                                       institutions).
                                                                       Program
                                                                       requirements apply
                                                                       only if school
                                                                       district receives
                                                                       funds.

Goals 2000   20 U.S.C.   Educatio  To assist       Provides financial  All school
             5801-6084   n         school          support to states   districts are
                                   districts in    and school          eligible to apply;
                                   improving a     districts for       program
                                   number of       education reform    requirements apply
                                   areas,          efforts.            only if school
                                   including                           district receives
                                   school                              funds.
                                   completion and
                                   student
                                   achievement.

Head Start   42 U.S.C.   Health    To help         Provides funding    All school
             9831-9855   and       prepare         to organizations    districts are
                         Human     disadvantaged   (including some     eligible to apply;
                         Services  preschool       school districts)   program
                                   children and    to provide          requirements apply
                                   their families  comprehensive       only if school
                                   for school.     early childhood     district receives
                                                   education and       funds.
                                                   support services
                                                   for children, with
                                                   priority to
                                                   children from low-
                                                   income families.

Impact Aid   20 U.S.C.   Educatio  To help         Provides general    School districts
             7701-7714   n         educate         financial aid to    are eligible to
                                   children of     qualifying school   receive funds only
                                   military        districts.          if they have large
                                   parents and to                      numbers of
                                   assist school                       federally
                                   districts that                      connected children
                                   are affected                        (including
                                   by the federal                      military and
                                   acquisition of                      Native American
                                   real property                       children), have
                                   or that                             experienced large
                                   experience                          increases in
                                   sudden                              enrollment of
                                   increases or                        military
                                   decreases in                        dependents, or
                                   enrollment due                      been negatively
                                   to military                         affected by the
                                   realignments.                       federal
                                                                       government's
                                                                       acquisition of
                                                                       real property in
                                                                       their district.

Innovative   20 U.S.C.   Educatio  To support      Provides financial  All school
Education    7301-7372   n         innovative      assistance to       districts are
Program                            local           states and school   eligible to apply.
Strategies                         education       districts for       Program
                                   reform          education reform    requirements apply
                                   efforts.        efforts.            only if school
                                                                       district receives
                                                                       funds.

Individuals  20 U.S.C.   Educatio  To ensure that  Provides financial  All states and
With         1401-1487   n         all children    support to states   school districts
Disabilitie                        with            and school          are eligible for
s Education                        disabilities    districts for the   funds if they have
Act (IDEA)                         are provided    education of        in effect policies
                                   with a free     students with       and procedures as
                                   and             disabilities; also  described in the
                                   appropriate     sets out            law. Districts are
                                   public          procedures (such    obligated to
                                   education and   as IEPs) and        provide a free and
                                   to provide      conditions (such    appropriate public
                                   financial       as placing          education whether
                                   support to      children in the     or not they
                                   states and      least restrictive   receive federal
                                   districts for   environment) that   funds.
                                   educating       school districts
                                   students with   must meet to
                                   disabilities.   provide a free,
                                                   appropriate public
                                                   education.

Magnet       20 U.S.C.   Educatio  To provide      Provides financial  Only school
Schools      7201-7213   n         assistance for  support for school  districts that are
program                            desegregation   districts that are  implementing a
(Title V)                          efforts by      implementing a      court-ordered
                                   supporting      desegregation plan  desegregation plan
                                   magnet schools  that includes       or a desegregation
                                   to attract      magnet schools.     plan approved by
                                   students of                         the Secretary of
                                   diverse racial                      Education are
                                   backgrounds.                        eligible. Program
                                                                       requirements apply
                                                                       only if school
                                                                       district receives
                                                                       funds.

Safe and     20 U.S.C.   Educatio  To make         Provides financial  All school
Drug Free    7101-7143   n         schools and     support to states   districts are
Schools and                        communities     and school          eligible to apply.
Communities                        safer by        districts for drug  Program
                                   preventing      and violence        requirements apply
                                   violence, hate  prevention          only if school
                                   crimes, and     programs.           district receives
                                   drug use.                           funds.

School to    20 U.S.C.   Educatio  To establish a  Provides financial  All school
Work         6161-6235   n and     national        support for states  districts are
Opportuniti              Labor     framework for   and school          eligible to apply.
es Act                             education and   districts to        Program
                                   training        implement programs  requirements apply
                                   programs that   designed to         only if school
                                   will prepare    facilitate the      district receives
                                   students for    transition from     funds.
                                   high-skill      school to work.
                                   careers,
                                   increase
                                   opportunities
                                   for further
                                   education, and
                                   utilize the
                                   workplace as a
                                   learning
                                   environment.

Section 504  29 U.S.C.   Educatio  To protect      Prohibits school    All school
of the       794         n         individuals     districts (and      districts are
Rehabilitat                        with            other recipients    eligible to apply.
ion Act                            disabilities    of federal          These requirements
                                   from            assistance) from    apply if school
                                   discriminatory  denying the         district receives
                                   treatment.      benefits of their   any federal funds.
                                                   programs to
                                                   otherwise
                                                   qualified
                                                   individuals with
                                                   disabilities.

Stewart B.   42 U.S.C.   Educatio  To provide      Provides some       All school
McKinney     11421-      n         funds for       school districts    districts are
Homeless     11435                 programs        with funds to       eligible to apply.
Assistance                         (including      ensure that         These requirements
Act                                education       homeless children   apply only if
                                   programs) to    have access to      school district
                                   assist the      education.          receives any
                                   homeless.                           federal funds.

Technology   20 U.S.C.   Educatio  To support a    Provides funds to   All school
for          6801-6871   n         comprehensive   states and school   districts are
Education                          system for the  districts to buy    eligible to apply.
                                   acquisition     and use new         Program
                                   and use by      technology.         requirements apply
                                   schools of                          only if school
                                   technology and                      district receives
                                   technology-                         funds.
                                   enhanced
                                   curricula and
                                   instruction so
                                   as to improve
                                   the delivery
                                   of educational
                                   services.

Tech-Prep    20 U.S.C.   Educatio  To help         Provides funding    Any partnership of
program      2394        n         prepare         for school          a school district
(part of                           students to     districts and       and postsecondary
Perkins                            work in a       postsecondary       institution is
Act)                               technologicall  institutions        eligible to apply
                                   y advanced      (generally          for funds. Program
                                   society by      community           requirements apply
                                   giving them     colleges) to        only if school
                                   needed          develop and         district receives
                                   academic and    operate 4-year      funds.
                                   occupational    "tech prep"
                                   skills          programs (which
                                   technology.     often lead to an
                                                   associate's
                                                   degree).

Telecommuni  47 U.S.C.   Federal   To promote      Provides school     All school
cations Act  151 et      Trade     competition     districts with      districts are
of 1996      seq.        Commissi  and reduce      discounts on        eligible to apply
                         on        regulation in   telecommunications  for discounts.
                                   order to        services.
                                   secure lower
                                   prices and
                                   higher quality
                                   services for
                                   consumers, and
                                   to encourage
                                   the rapid
                                   deployment of
                                   new
                                   communications
                                   technologies.

Title I      20 U.S.C.   Educatio  To assist       Provides financial  School districts
(Elementary  6301-6514   n         school          support to states   are eligible to
and                                districts in    and school          receive funds if
Secondary                          addressing the  districts for       more than 2
Education                          needs of        programs designed   percent of
Act)                               economically    to assist children  district students
                                   disadvantaged   in high-poverty     are from families
                                   children,       areas.              with incomes below
                                   especially in                       the poverty level.
                                   reading and                         Program
                                   math.                               requirements apply
                                                                       only if school
                                                                       district receives
                                                                       funds.

Food Service
-----------------------------------------------------------------------------------------
National     42 U.S.C.   Agricult  To help         Provides financial  All school
School       1751-1790   ure       increase        assistance and      districts are
Breakfast                          children's      commodity support   eligible to
program                            capacity to     for meals served    participate.
                                   learn by        to children.        Program
                                   supporting                          requirements do
                                   school-based                        not apply unless
                                   programs to                         school district
                                   provide                             receives funds.
                                   nutritious
                                   food to
                                   children and
                                   to provide for
                                   the domestic
                                   consumption of
                                   nutritious
                                   agricultural
                                   commodities.

National     42 U.S.C.   Agricult  To help         Provides financial  All school
School       1751-1790   ure       increase        assistance and      districts are
Lunch                              children's      commodity support   eligible to
program                            capacity to     for meals served    participate.
                                   learn by        to children.        Program
                                   supporting                          requirements do
                                   school-based                        not apply unless
                                   programs to                         school district
                                   provide                             receives funds.
                                   nutritious
                                   food to
                                   children and
                                   to provide for
                                   the domestic
                                   consumption of
                                   nutritious
                                   agricultural
                                   commodities.

Summer Meal  42 U.S.C.   Agricult  To help         Provides financial  All school
program      1751-1790   ure       increase        assistance and      districts are
                                   children's      commodity support   eligible to
                                   capacity to     for meals served    participate.
                                   learn by        to children.        Program
                                   supporting                          requirements do
                                   school-based                        not apply unless
                                   programs to                         school district
                                   provide                             receives funds.
                                   nutritious
                                   food to
                                   children and
                                   to provide for
                                   the domestic
                                   consumption of
                                   nutritious
                                   agricultural
                                   commodities.

Employment
-----------------------------------------------------------------------------------------
Age          29 U.S.C.   Equal     To protect      Prohibits           Applies to
Discriminat  621-634     Employme  workers         discrimination in   employers with 20
ion in                   nt        against         employment          or more employees
Employment               Opportun  discrimination  (including          (including school
Act                      ity       in employment   employee benefits)  districts).
                         Commissi  on the basis    on the basis of
                         on        of age.         age against people
                         (EEOC)                    40 years and
                                                   older.

Americans    42 U.S.C.   EEOC      To protect      Prohibits           Applies to
With         12101-                workers with    discrimination in   employers
Disabilitie  12130                 disabilities    employment against  (including school
s Act,                             against         individuals with    districts) with 15
Title I                            discrimination  disabilities and    or more employees.
                                   in employment.  requires employers
                                                   to make
                                                   "reasonable
                                                   accommodations"
                                                   for disabilities
                                                   unless doing so
                                                   would cause undue
                                                   hardship to the
                                                   employer.

Civil        42 U.S.C.   EEOC      To protect      Prohibits           Applies to
Rights Act,  2000e                 workers         employment          employers
Title VII                          against         discrimination on   (including school
                                   discrimination  the basis of race,  districts) with 15
                                   in employment.  color, religion,    or more employees.
                                                   sex, or national
                                                   origin.

Fair Labor   29 U.S.C.   Labor     To protect      Requires employers  Applies to all
Standards    201-219               workers by      to pay a minimum    employers
Act                                establishing    wage, to pay        (including school
                                   provisions for  overtime to         districts) with
                                   minimum wages,  eligible ("non-     more than one
                                   overtime, and   exempt") workers,   employee.
                                   child labor     and to obey child
                                   standards.      labor standards.

Family and   29 U.S.C.   Labor     To provide      Requires employers  Applies to all
Medical      2601-2654             workers with    to allow employees  employers with 50
Leave Act                          the right to    to take up to 12    or more employees,
                                   take unpaid     weeks of unpaid,    including school
                                   leave under     job-protected       districts.
                                   certain         leave to take care  However, special
                                   conditions      of a sick child,    rules apply with
                                   without losing  parent, or spouse,  respect to
                                   their jobs.     for the birth or    instructional
                                                   adoption of a       employees of
                                                   child, or for the   school districts.
                                                   employee's own      These provisions
                                                   serious health      allow the district
                                                   condition.          to play a role in
                                                                       scheduling unpaid
                                                                       leave for teachers
                                                                       and other
                                                                       instructional
                                                                       staff.

Occupationa  29 U.S.C.   Occupati  To protect      Requires employers  School districts
l Safety     651-679     onal      workers from    to adhere to        are generally
and Health               Safety    recognized      safety and health   exempt under the
Act                      and       safety hazards  standards.          federal OSHA
                         Health    in the                              legislation.
                         Administ  workplace.                          However, 19 states
                         ration                                        (including
                                                                       California,
                                                                       Michigan, and
                                                                       North Carolina)
                                                                       operate their own
                                                                       health and safety
                                                                       programs that
                                                                       include both
                                                                       public and private
                                                                       employers,
                                                                       including school
                                                                       districts. Another
                                                                       2 states (New York
                                                                       and Connecticut)
                                                                       do not run their
                                                                       own programs but
                                                                       require public
                                                                       employees to
                                                                       adhere to safety
                                                                       and health
                                                                       standards.

Environmental and Facilities
-----------------------------------------------------------------------------------------
Americans    42 U.S.C.   Justice   To ensure       New structures      All school
with         12131-                accessibility   and, in some        districts are
Disabilitie  12211                 for             cases, renovations  covered.
s Act---                           individuals     of existing
Title II                           with            structures must
                                   disabilities.   meet design
                                                   standards for
                                                   accessibility.

Asbestos     15 U.S.C.   Environm  To help         School districts    All school
Hazard       2641-       ental     identify and    were required to    districts are
Emergency    2656; 20    Protecti  abate asbestos  inspect each        covered.
Response     U.S.C.      on        hazards in      school for
Act and      4011-4022   Agency    schools.        asbestos and draw
Asbestos                                           up an asbestos
School                                             management plan.
Hazard
Abatement
Act

Davis-       40 U.S.C.   Labor     To ensure a     Contractors         Contracts in
Bacon Act    276a                  prevailing      working on          excess of $2,000
                                   wage for        construction        are covered.
                                   laborers and    projects for
                                   mechanics       school districts
                                   employed on     may be required to
                                   construction    pay prevailing
                                   contracts       local wages.
                                   supported by
                                   the federal
                                   government.

Resource     42 U.S.C.   EPA       To promote the  School districts    School districts
Conservatio  6901-6992             protection of   must dispose of     with USTs or
n and                              health and the  any hazardous       hazardous
Recovery                           environment by  materials properly  materials must
Act                                regulating      and comply with     comply with EPA
                                   hazardous       EPA standards       standards.
                                   waste           concerning          However, some USTs
                                   disposal.       underground         are exempt--for
                                                   storage tanks       example, tanks
                                                   (UST) where         that store heating
                                                   applicable.         oil for use on the
                                                                       premises.

Tax Reform   26 U.S.C.   Internal  To prevent the  School districts    Exceptions are
Act of 1986  103, 148    Revenue   use of funds    are generally not   allowed for
                         Service   from the sale   allowed to use the  investment for a
                                   of tax-exempt   provisions of tax-  temporary period,
                                   bonds to        exempt bonds to     for investment of
                                   acquire         buy higher          a minor portion,
                                   higher-         yielding            and for investment
                                   yielding        investments.        in a reasonably
                                   investments.                        required reserve
                                                                       or replacement
                                                                       fund. In addition,
                                                                       a special
                                                                       exemption for
                                                                       bonds up to $10
                                                                       million is allowed
                                                                       to finance the
                                                                       construction of
                                                                       public school
                                                                       facilities if
                                                                       certain conditions
                                                                       are met.

Toxic        15 U.S.C.   EPA       To ensure that  School districts    School districts
Substances   2601-                 commerce in     may be required to  are subject to
Control Act  2629; 15              chemical        comply with         these requirements
             U.S.C.                substances and  storage, disposal,  as applicable.
             2661-2692             mixtures does   and recordkeeping
                                   not present an  requirements for
                                   unreasonable    polychlorinated
                                   risk to health  biphenyls (PCBs)
                                   or the          or other chemical
                                   environment.    substances as
                                                   applicable. This
                                                   legislation also
                                                   provides
                                                   assistance to
                                                   states to develop
                                                   programs aimed at
                                                   lead or radon
                                                   hazards, which may
                                                   affect school
                                                   districts in some
                                                   states.
-----------------------------------------------------------------------------------------

INFORMATION ON FUNDING FOR MAJOR
FEDERAL LAWS AND PROGRAMS
========================================================== Appendix II

                                           Funding
                             Plan or       distributed
Law or         FY 1998       application   through the   Description of distribution of
program        funding       required?     state?        funds
-------------  ------------  ------------  ------------  --------------------------------
Education
-----------------------------------------------------------------------------------------
Adult          $354 million  x             x             Funds are allotted to each state
Education                                                on the basis of a formula that
                                                         is related to the number of
                                                         adults who do not have a
                                                         certificate of graduation from a
                                                         secondary school. Each state
                                                         must submit a 4-year state plan.
                                                         Funds are distributed by states
                                                         to local organizations
                                                         (including school districts)
                                                         through competitive grants;
                                                         these grants are to be awarded
                                                         in accordance with the state's
                                                         plan.

Bilingual      $199 million  x                           School districts submit
Education                                                applications to the state for
                                                         comment, then to the Secretary
                                                         of Education. A minimum of 75
                                                         percent of funds is reserved for
                                                         bilingual education programs.
                                                         The Department of Education
                                                         gives priority to applications
                                                         that (1) provide for the
                                                         development of bilingual
                                                         proficiency in both English and
                                                         another language; (2) are from
                                                         school districts that large
                                                         numbers of students with limited
                                                         English proficiency; and/or (3)
                                                         are from school districts that
                                                         have experienced significant
                                                         increases in the number of
                                                         students with limited English
                                                         proficiency.

Carl D.        $1.028        x             x             States are allocated funds for
Perkins        billion                                   high school-level programs under
Vocational-                                              a formula primarily based on the
Technical                                                number of students aged 9 to 15
Education Act                                            and previous allocations, with a
                                                         set minimum. Each state must
                                                         produce a state plan and
                                                         establish a state vocational
                                                         education board. Funds are
                                                         distributed to districts on the
                                                         basis of previous allocations
                                                         and the number of students with
                                                         disabilities. Ten and a half
                                                         percent of funds are set aside
                                                         for programs for single parents,
                                                         displaced homemakers, and single
                                                         pregnant women. In addition,
                                                         districts are required to give
                                                         priority to programs that have
                                                         higher concentrations of
                                                         "special population" students:
                                                         students with disabilities,
                                                         economically disadvantaged
                                                         students, and students with
                                                         limited English proficiency.
                                                         Districts that are allocated
                                                         less than $15,000 must join a
                                                         consortium to receive funds.

Eisenhower     $335 million  x             x             Funds are allocated to the
Professional                                             states, with 50 percent of the
Development                                              funds allotted to each state on
State Grants                                             the basis of the number of
(Title II)                                               students and the other 50
                                                         percent allotted on the basis of
                                                         the Title I formula. State funds
                                                         are distributed to school
                                                         districts in the same way.
                                                         Districts that are allocated
                                                         less than $10,000 must join a
                                                         consortium to receive funds;
                                                         however, states are allowed to
                                                         waive this requirement.

Emergency      $150 million  x             x             Funds are distributed to states,
Immigrant                                                but only states that contain
Education                                                eligible school districts can
Program (Part                                            receive funds. Allocations to
C of Title                                               states are based on the
VII)                                                     percentage of immigrant children
                                                         in each state compared with all
                                                         the states. At least half of the
                                                         funds given to states must be
                                                         distributed to school districts
                                                         with the highest numbers and
                                                         percentages of immigrant
                                                         children and youth.

Even Start     $198 million  x             x             Funds are allocated to the
Family                                                   states on the basis of the Title
Literacy                                                 I formula, with a minimum grant
programs                                                 of $250,000. Partnerships
                                                         (school districts partnered with
                                                         community-based organizations or
                                                         higher education institutions)
                                                         apply for funds. There is a
                                                         minimum grant level of $75,000.
                                                         Priority is given to applicants
                                                         from areas with a high
                                                         percentage of poverty,
                                                         illiteracy, unemployment, and
                                                         limited English proficiency;
                                                         areas designated as empowerment
                                                         zones or enterprise communities
                                                         are also given priority.

Gifted and     $6.5 million  x                           Funds are distributed directly
Talented                                                 to grantees (including school
programs                                                 districts) after a competitive
                                                         peer review process.

Goals 2000     $491 million  x             x             Funds are allotted to states in
                                                         accordance with their relative
                                                         allocations under Title I and
                                                         the Eisenhower program. Ninety
                                                         percent of funds awarded to the
                                                         state are distributed to school
                                                         districts on a competitive basis
                                                         according to criteria outlined
                                                         in the federal statute.

Head Start     $4.355        x\a                         Funds are distributed directly
               billion                                   to each Head Start agency on the
                                                         basis of past allocations. For
                                                         newly designated agencies, grant
                                                         amounts are based on a complex
                                                         formula that includes the
                                                         percentage of low-income
                                                         children in the state.

Impact Aid     $808 million                              Funds are distributed directly
                                                         to school districts. Aid
                                                         resulting from federal
                                                         acquisition of property is based
                                                         on the current tax rate received
                                                         by the school district on the
                                                         value of the property. Aid
                                                         resulting from large numbers of
                                                         federally connected children is
                                                         distributed by a formula that is
                                                         based on the number of children
                                                         and the amount received in the
                                                         past.

Innovative     $310 million  x             x             Funds are allotted to states on
Education      \b                                        the basis of the school-aged
Program                                                  population, with a minimum
Strategies                                               amount to each state. At least
                                                         85 percent of the funds must be
                                                         allocated to school districts,
                                                         with priority to districts with
                                                         the greatest numbers or
                                                         percentages of (1) children
                                                         living in areas with high
                                                         concentrations of low-income
                                                         people; (2) children from low-
                                                         income families; and (3)
                                                         children living in sparsely
                                                         populated areas.

Individuals    $4.8 billion  x             x             Funds are distributed to states
With                                                     on the basis of a complex
Disabilities                                             formula that includes the number
Education Act                                            of children with disabilities
(IDEA)                                                   and (once total funding reaches
                                                         a certain threshold) the total
                                                         number of children and the
                                                         number of children in poverty.
                                                         At least 75 percent of funds
                                                         must be distributed to school
                                                         districts. School districts are
                                                         allocated a base payment plus
                                                         additional funds according to
                                                         the number of students and the
                                                         number of poor students.

Magnet         Not           x                           Funds are distributed directly
Schools        available                                 to school districts by the
Program                                                  Department of Education. Funding
(Title V)                                                priority is given to districts
                                                         whose programs (1) have the
                                                         greatest need, (2) are new
                                                         magnet school projects, (3) are
                                                         magnet schools where students
                                                         are chosen by lottery, (4) are
                                                         in accordance with Goals 2000,
                                                         and (5) draw on comprehensive
                                                         community involvement plans.

Safe and Drug  $556 million  x             x             Funds are distributed to states
Free Schools                                             through a formula that is
and                                                      primarily based on student
Communities                                              population. Eighty percent of
                                                         each state's allocation must be
                                                         distributed to school districts,
                                                         with the remaining 20 percent
                                                         funding Governors' programs that
                                                         are distributed to community
                                                         based organizations. Of the
                                                         funds allocated to school
                                                         districts, 70 percent are
                                                         distributed on the basis of
                                                         population and the remaining 30
                                                         percent on the basis of need.

School to      Not           x             x             Each state must develop a state
Work           available                                 plan to be eligible for funds.
Opportunities                                            At least 90 percent of these
Act                                                      funds are distributed to local
                                                         partnerships through competitive
                                                         grants.

Section 504    None          Not           Not           Not applicable
of the                       applicable    applicable
Rehabilitatio
n Act

Stewart B.     $28.8         x             x             All states can apply for funds.
McKinney       million                                   Funds are distributed to the
Homeless                                                 states using the Title I
Assistance                                               formula, with a minimum grant
Act                                                      amount. School districts must
                                                         apply to the state, which awards
                                                         funds on the basis of need.

Technology     $584 million  x             x             All states can apply for funds.
for Education                                            Funds are distributed to the
                                                         states using the Title I
                                                         formula, with a minimum grant
                                                         amount. School districts must
                                                         apply to the state, which awards
                                                         funds on a competitive basis.

Tech-Prep      Not           x             x\c           Funds are distributed by the
program (part  available                                 states or by the Department of
of Perkins                                               Education, depending on total
Act)                                                     program funding.

Telecommunica  Not           x                           Program has not yet been
tions Act of   available                                 implemented.
1996

Title I        $8 billion    x             x             Funds for the basic grant are
(Elementary                                              allocated to the state, and from
and Secondary                                            the state to the school
Education                                                district, on the basis of a very
Act)                                                     complex formula that includes,
                                                         among other things, the number
                                                         of children from poor families,
                                                         the average per pupil
                                                         expenditure in the state, and
                                                         the amount the state has
                                                         received in previous years.
                                                         School districts are also
                                                         eligible for additional
                                                         concentration grants if they
                                                         have especially high percentages
                                                         of children in poverty.

Food Service
-----------------------------------------------------------------------------------------
National       $1.3 billion                x             Funds are distributed to states
School                                                   and allocated to school
Breakfast                                                districts on the basis of the
program                                                  number of free, reduced-price,
                                                         and full-price meals served.
                                                         "Severe need" schools can obtain
                                                         a slightly higher reimbursement
                                                         rate. To obtain a "severe need"
                                                         designation, a school must show
                                                         that its costs exceed the
                                                         regular rate and must serve 40
                                                         percent or more of its
                                                         breakfasts for free or the
                                                         reduced price. Commodities are
                                                         distributed to schools through
                                                         the state.

National       $4.2 billion                x             Funds are distributed to states
School Lunch                                             and allocated to school
program                                                  districts on the basis of the
                                                         number of free, reduced-price,
                                                         and full-price meals served.
                                                         Commodities are distributed to
                                                         schools through the state.

Summer Meal    $272.3                      x             Funds are distributed to states
program        million                                   and allocated to school
                                                         districts on the basis of the
                                                         number of free and reduced-
                                                         price meals served. Commodities
                                                         are distriburted to schools
                                                         through the state.

Employment
-----------------------------------------------------------------------------------------
Age            None          Not           Not           Not applicable
Discriminatio                applicable    applicable
n in
Employment
Act

Americans      None          Not           Not           Not applicable
With                         applicable    applicable
Disabilities
Act, Title I

Civil Rights   None          Not           Not           Not applicable
Act, Title                   applicable    applicable
VII

Fair Labor     None          Not           Not           Not applicable
Standards Act                applicable    applicable

Family and     None          Not           Not           Not applicable
Medical Leave                applicable    applicable
Act

Occupational   None          Not           Not           Not applicable
Health and                   applicable    applicable
Safety Act

Environmental and Facilities
-----------------------------------------------------------------------------------------
Americans      None          Not           Not           Not applicable
With                         applicable    applicable
Disabilities
Act---Title
II

Asbestos       None          Not           Not           Not applicable
Hazard                       applicable    applicable
Emergency
Response Act
and Asbestos
School Hazard
Abatement Act

Davis-Bacon    None          Not           Not           Not applicable
Act                          applicable    applicable

Resource       None          Not           Not           Not applicable
Conservation                 applicable    applicable
and Recovery
Act

Tax Reform     None          Not           Not           Not applicable
Act of 1986                  applicable    applicable

Toxic          None          Not           Not           Not applicable
Substances                   applicable    applicable
Control Act
-----------------------------------------------------------------------------------------
\a An initial competitive application is required, and a
reapplication form is filed annually.  However, once the district has
been designated as a Head Start agency, it does not have to compete
for funds in subsequent years.

\b This figure is for fiscal year 1997.

\c If the program is funded over $50 million, then the money is
allocated to the states under the basic grant Perkins Act formula,
and the states award grants to consortia on a competitive basis or on
the basis of a formula determined by the state.  If total program
funding is under $50 million, the Department of Education awards the
grants directly to the partnerships.

(See figure in printed edition.)Appendix III
COMMENTS FROM THE DEPARTMENT OF
AGRICULTURE
========================================================== Appendix II

(See figure in printed edition.)

(See figure in printed edition.)

GAO CONTACTS AND STAFF
ACKNOWLEDGMENTS
========================================================== Appendix IV

GAO CONTACTS

Harriet Ganson, Assistant Director, (202) 512-9045
Sarah L.  Glavin, Senior Economist and Project Manager, (202)
512-7180

STAFF ACKNOWLEDGMENTS

Arthur T.  Merriam Jr., Senior Evaluator, managed the state survey
and co-wrote portions of the report; Linda W.  Stokes, Senior
Evaluator, managed several site visits, assisted in data-gathering,
and co-wrote portions of the report; Daniel C.  Schwimmer and Robert
G.  Crystal provided legal assistance; Linda Choy and Robert J.
Aiken provided programming and database assistance; and Sally Coburn,
Senior Evaluator; Gene Kuehneman, Senior Economist; Susan Lawless,
Senior Evaluator; John McDonough, Senior Evaluator; Kevin Murphy,
Senior Evaluator; and Linda McIver, Senior Evaluator, conducted the
telephone interviews.

BIBLIOGRAPHY
============================================================ Chapter 1

   EDUCATION FINANCE
---------------------------------------------------------- Chapter 1:1

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   ENVIRONMENTAL REQUIREMENTS
---------------------------------------------------------- Chapter 1:2

U.S.  Environmental Protection Agency.  "Airborne Asbestos
Concentrations Three Years After Abatement in Seventeen Schools,"
EPA/600/R-93/152, Aug.  1993.

_____.  "AHERA Clearance at Twenty Abatement Sites,"
EPA/600/2-91/028, July 1991.

_____.  "Asbestos in Schools:  Evaluation of the Asbestos Hazard
Emergency Response Act (AHERA):  A Summary Report," EPA 560/4-91-012,
June 1991.

   FOOD AND NUTRITION PROGRAMS
---------------------------------------------------------- Chapter 1:3

U.S.  Department of Agriculture.  "Paperwork Reduction in the School
Nutrition Programs," 1996.

_____.  "Improving USDA Commodities," Oct.  1995.

_____.  School Lunch and Breakfast Cost Study, Final Report.  Abt
Associates, Oct.  1994.

   LIMITED ENGLISH PROFICIENCY
---------------------------------------------------------- Chapter 1:4

Council of Chief State School Officers.  Systematic Reform and
Limited English Proficient Students.  Washington, D.C.:  Feb.  1996.

Parrish, Thomas B.  "A Cost Analysis of Alternative Instructional
Models for Limited English Proficient Students in California,"
Journal of Education Finance, 19 (Winter 1994) 256-78.

Sevilla, Jennifer.  "Bilingual Education:  The Last 25 Years," in
Helping At-Risk Students:  What Are the Educational and Financial
Costs?  eds.  Patricia Anthony and Stephen L.  Jacobson.  Newbery
Park, Calif.:  Corwin Press, 1992, pp.  38-65.

U.S.  Department of Education, Office of Educational Research and
Improvement, National Center for Education Statistics.  "Are Limited
English Proficient (LEP) Students Being Taught by Teachers with LEP
Training?" Issue Brief.  NCES 97-907, Dec.  1996.

   SPECIAL EDUCATION
---------------------------------------------------------- Chapter 1:5

American Association of School Administrators.  Opportunities and
Challenges:  An Administrator's Guide to the New IDEA.  Washington,
D.C.:  1997.

Anthony, Patricia.  "Individuals with Disabilities Education Act:
The Legacy Continues," in Helping At-Risk Students:  What Are the
Educational and Financial Costs?  eds.  Patricia Anthony and Stephen
L.  Jacobson.  Newbery Park, Calif.:  Corwin Press, 1992, pp.  1-11.

Brown, Stephanie, et al.  "Impact of Personnel Policies on Students
with Disabilities," Helping At-Risk Students:  What Are the
Educational and Financial Costs?  eds.  Patricia Anthony and Stephen
L.  Jacobson.  Newbery Park, Calif.:  Corwin Press, 1992, pp.
229-252.

Chaikind, Stephen, Louis C.  Danielson, and Marsha L.  Brauen.  "What
Do We Know About the Costs of Special Education?  A Selected Review,"
The Journal of Special Education, 26 (4) (1993) 344-70.

Chaikind, Stephen, and Hope Corman.  "The Impact of Low Birthweight
on Special Education Costs," Journal of Health Economics, 10 (1991)
291-311.

Finlan, Thomas Gerald, and William T.  Hartman.  "Cost Projections
for Learning Disabilities," in Helping At-Risk Students:  What Are
the Educational and Financial Costs?  eds.  Patricia Anthony and
Stephen L.  Jacobson.  Newbery Park, Calif.:  Corwin Press, 1992, pp.
166-88.

Hartman, William T.  "Policy Effects of Special Education Funding
Formulas," Journal of Education Finance, 6 (Fall 1980) 135-59.

Hocutt, Anne M.  "Effectiveness of Special Education:  Is Placement
the Crucial Factor?" in "Special Education for Children with
Disabilities," The Future of Children, 6 (1) (Spring 1996) 77-102.

Lyon, G.  Reid.  "Learning Disabilities," in "Special Education for
Children with Disabilities," The Future of Children, 6 (1) (Spring
1996) 54-76.

National Council on Disability.  Improving the Implementation of the
Individuals with Disbilities Education Act:  Making Schools Work for
All of America's Children.  Washington, D.C.:  May 9, 1995.

_____.  Inclusionary Education for Students with Disabilities:
Keeping the Promise.  Washington, D.C.:  Dec.  30, 1994.

_____.  Serving the Nation's Students with Disabilities:  Progress
and Prospects.  Washington, D.C.:  Mar.  4, 1993.

Parrish, Thomas B.  "Special Education Finance:  Past, Present, and
Future," U.S.  Department of Education, Office of Special Education
Programs, Center for Special Education Finance, Policy Paper No.  8,
May 1996.

Parrish, Thomas B., and Jay G.  Chambers.  "Financing Special
Education," in "Special Education for Children with Disabilities,"
The Future of Children, 6 (1) (Spring 1996) 121-38.

Raphael, Ellen S., Judith D.  Singer, and Deborah Klein Walker.  "Per
Pupil Expenditures on Special Education in Three Metropolitan School
Districts," Journal of Education Finance, 11 (Summer 1985) 69-88.

Reschly, Daniel J.  "Identification and Assessment of Students with
Disabilities," in "Special Education for Children with Disabilities,"
The Future of Children, 6 (1) (Spring 1996) 40-53.

Rossman, Gretchen B.  "State Policy for Integrating All Students," in
Helping At-Risk Students:  What Are the Educational and Financial
Costs?  eds.  Patricia Anthony and Stephen L.  Jacobson.  Newbery
Park, Calif.:  Corwin Press, 1992, pp.  210-28.

Singer, Judith D., et al.  "Variation in Special Education
Classification Across School Districts:  How Does Where You Live
Affect What You Are Labeled?" American Educational Research Journal,
26 (2) (Summer 1989) 261-81.

Slobojan, Alan.  "Descriptive Cost Analysis of Special Education,"
Journal of Education Finance, 12 (Summer 1987) 99-106.

Terman, Donna L., et al.  "Special Education for Students with
Disabilities:  Analysis and Recommendations," in "Special Education
for Children with Disabilities," The Future of Children, 6 (1)
(Spring 1996) 4-24.

Thompson, David C., and Robert H.  Zabel.  "Special Education in
Rural Areas," in Helping At-Risk Students:  What Are the Educational
and Financial Costs?  eds.  Patricia Anthony and Stephen L.
Jacobson.  Newbery Park, Calif.:  Corwin Press, 1992, pp.  189-209.

U.S.  Commission on Civil Rights.  Equal Educational Opportunity
Project Series, Vol.  I.  Washington, D.C.:  Dec.  1996.

_____.  Equal Educational Opportunity and Nondiscrimination for
Students with Disabilities:  Federal Enforcement of Section 504,
Equal Educational Opportunity Project Series, Vol.  II.  Washington,
D.C.:  Sept.  1997.

U.S.  Department of Education, Office of Educational Research and
Improvement, National Center for Education Statistics.  Profiles of
Students with Disabilities Identified in NELS:88.  NCES 97-254, June
1997.

Verstegen, Deborah, and Cynthia L.  Cox.  "State Models for Financing
Special Education," in Helping At-Risk Students:  What Are the
Educational and Financial Costs?  eds.  Patricia Anthony and Stephen
L.  Jacobson.  Newbery Park, Calif.:  Corwin Press, 1992, pp.
136-65.

RELATED GAO PRODUCTS
============================================================ Chapter 2

Grant Programs:  Design Features Shape Flexibility, Accountability,
and Performance Information (GAO/GGD-98-137, June 22, 1998).

Individuals With Disabilities Education Act:  School Districts'
Response to Regulatory Deadline (GAO/T-HEHS-98-159, Apr.  22, 1998).

Charter Schools:  Federal Funding Available but Barriers Exist
(GAO/HEHS-98-84, Apr.  30, 1998).

Head Start Programs:  Participant Characteristics, Services, and
Funding (GAO/HEHS-98-65, Mar.  31, 1998).

School Technology:  Five School Districts' Experiences in Funding
Technology Programs (GAO/HEHS-98-35, Jan.  29, 1998).

Education Programs:  Information on the Ed-Flex Demonstration Project
(GAO/HEHS-98-61R, Dec.  15, 1997).

Education Programs:  Information on Major Preschool, Elementary, and
Secondary Education Programs (GAO/HEHS-97-210R, Sept.  15, 1997).

Regulatory Burden:  Measurement Challenges and Concerns Raised by
Selected Companies (GAO/GGD-97-2, Nov.  18, 1996).

People With Disabilities:  Federal Programs Could Work Together More
Efficiently to Promote Employment (GAO/HEHS-96-126, Sept.  3, 1996).

School Facilities:  Profiles of School Condition by State
(GAO/HEHS-96-148, June 24, 1996).

School Lunch Program:  Cafeteria Managers' Views on Food Wasted by
Students (GAO/RCED-96-191, July 18, 1996).

School Facilities:  America's Schools Report Differing Conditions
(GAO/HEHS-96-103, June 14, 1996).

School Facilities:  Accessibility for the Disabled Still An Issue
(GAO/HEHS-96-73, Dec.  29, 1995).

*** End of document. ***