Amended Complaint, State of Michigan et al. v. DeVos, No. 3:20-cv-04478 (N.D. Cal.), Doc. 24 (July 17, 2020)
Summary
First Amended Complaint for Declaratory and Injunctive Relief in State of Michigan et al. v. DeVos, Civil Case No. 3:20-cv-04478-SK, United States District Court for the Northern District of California, filed July 17, 2020 as Document 24. The Plaintiff States, including the State of Michigan and the State of California, and the Plaintiff LEAs, including San Francisco Unified School District, challenge a rule promulgated by Secretary Elisabeth D. DeVos and the United States Department of Education. They allege that the rule unlawfully and erroneously interprets the CARES Act and that the Department grafted its own allocation and eligibility rules. The complaint describes the statute as authorizing the allocation of $30.75 billion for elementary and secondary schools and higher education.
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“Amended Complaint, State of Michigan et al. v. DeVos, No. 3:20-cv-04478 (N.D. Cal.), Doc. 24 (July 17, 2020).”
Original at storage.courtlistener.com. Archived at Pandemic Darlings, https://pandemicdarlings.com/source-documents/amended-complaint-state-of-michigan-et-al-v-devos-no-3-20-cv-04478-n-d-ab97cf2d4d/
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Case 3:20-cv-04478-SK Document 24 Filed 07/17/20 Page 1 of 88
1 XAVIER BECERRA
Attorney General of California
2 MICHAEL NEWMAN
Senior Assistant Attorney General
3 SARAH E. BELTON
Supervising Deputy Attorney General
4 REBEKAH A. FRETZ
JAMES F. ZAHRADKA II
5 GARRETT M. LINDSEY (SBN 293456)
Deputy Attorneys General
6 300 South Spring Street, Suite 1702
Los Angeles, CA 90013
7 Telephone: (213) 269-6402
E-mail: Garrett.Lindsey@doj.ca.gov
8 Attorneys for Plaintiff State of California
9 (List of other Plaintiffs’ counsel continued on next page)
10
IN THE UNITED STATES DISTRICT COURT
11 FOR THE NORTHERN DISTRICT OF CALIFORNIA
12
13
STATE OF MICHIGAN, STATE OF Civil Case No. 3:20-cv-04478-SK
14 CALIFORNIA, DISTRICT OF
COLUMBIA, STATE OF HAWAII, STATE
15 OF MAINE, STATE OF MARYLAND,
STATE OF NEW MEXICO, FIRST AMENDED COMPLAINT FOR
16 COMMONWEALTH OF DECLARATORY AND INJUNCTIVE
PENNSYLVANIA, STATE OF RELIEF
17 WISCONSIN, THE BOARD OF
EDUCATION FOR THE CITY SCHOOL
18 DISTRICT OF THE CITY OF NEW YORK,
BOARD OF EDUCATION FOR THE CITY
19 OF CHICAGO, CLEVELAND
MUNICIPAL SCHOOL DISTRICT
20 BOARD OF EDUCATION, and SAN
FRANCISCO UNIFIED SCHOOL
21 DISTRICT,
22 Plaintiffs,
23 v.
24
ELISABETH D. DEVOS, IN HER OFFICIAL
25 CAPACITY AS THE UNITED STATES
SECRETARY OF EDUCATION, AND UNITED
26 STATES DEPARTMENT OF
EDUCATION,
27
Defendants.
28
First Amended Complaint for Declaratory and Injunctive Relief
Case 3:20-cv-04478-SK Document 24 Filed 07/17/20 Page 2 of 88
1 DANA NESSEL BRIAN E. FROSH
Attorney General of Michigan Attorney General of Maryland
2 FADWA A. HAMMOUD STEVEN M. SULLIVAN
Solicitor General Solicitor General
3 TONI L. HARRIS 200 Saint Paul Place
NEIL GIOVANATTI Baltimore, Maryland 21202
4 Assistant Attorneys General (410) 576-6427
Michigan Department of Attorney General sullivan@oag.state.md.us
5 P.O. Box 30758 Attorneys for Plaintiff State of Maryland
Lansing, MI 48909
6 (517) 335-7603 HECTOR BALDERAS
HammoudF1@michigan.gov Attorney General of New Mexico
7 HarrisT19@michigan.gov P. CHOLLA KHOURY
GiovanattiN@michigan.gov LISA GIANDOMENICO
8 Attorneys for Plaintiff State of Michigan Assistant Attorneys General
Consumer & Environmental Protection
9 KARL A. RACINE Division
Attorney General of the District of Columbia New Mexico Attorney General’s Office
10 KATHLEEN KONOPKA 201 Third Street NW, Suite 300
Deputy Attorney General, Public Advocacy Albuquerque, NM 87102
11 Division (505) 490-4846
BRENDAN B. DOWNES ckhoury@nmag.gov
12 NICOLE HILL lgiandomenico@nmag.gov
Assistant Attorneys General, Public Attorneys for Plaintiff State of New Mexico
13 Advocacy Division
Office of the Attorney General for the JOSH SHAPIRO
14 District of Columbia Attorney General of Pennsylvania
441 4th St., N.W. Suite 630S MICHAEL J. FISCHER
15 Washington, DC 20001 Chief Deputy Attorney General
(202) 724-6610 Impact Litigation Section
16 Kathleen.Konopka@dc.gov Pennsylvania Office of Attorney General
Attorneys for Plaintiff District of Columbia 21 S. 12th Street, 3rd Floor
17 Philadelphia, PA 19107
CLARE E. CONNORS (215) 560-2171
18 Attorney General of Hawaii mfischer@attorneygeneral.gov
HOLLY T. SHIKADA Attorneys for Plaintiff Commonwealth of
19 KEVIN M. RICHARDSON Pennsylvania
Deputy Attorneys General
20 Education Division JOSHUA L. KAUL
235 South Beretania Street, Suite 304 Attorney General of Wisconsin
21 Honolulu, HI 96813 HANNAH S. JURSS
(808) 586-1255 Assistant Attorney General
22 Kevin.M.Richardson@hawaii.gov Wisconsin Department of Justice
Attorneys for Plaintiff State of Hawaii Post Office Box 7857
23 Madison, WI 53707
AARON M. FREY (608) 266-8101
24 Attorney General of Maine jursshs@doj.state.wi.us
SARAH A. FORSTER Attorneys for Plaintiff State of Wisconsin
25 Assistant Attorney General
6 State House Station
26 Augusta, ME 04333-0006
(207) 626-8866
27 sarah.forster@maine.gov
Attorneys for Plaintiff State of Maine
28
First Amended Complaint for Declaratory and Injunctive Relief
Case 3:20-cv-04478-SK Document 24 Filed 07/17/20 Page 3 of 88
1 JAMES E. JOHNSON SQUIRE PATTON BOGGS (US) LLP
Corporation Counsel of the City of New GABRIEL COLWELL (CABN 216783)
2 York COLIN R. JENNINGS (OHBN 0068704)
ERIC PROSHANSKY W. MICHAEL HANNA (OHBN 0020149)
3 HOPE LU EMILY R. SPIVACK (OHBN 0090777)
GAIL RUBIN 555 South Flower Street, Suite 3100
4 Assistant Corporation Counsel Los Angeles, CA 90071
100 Church Street (213) 624-2500
5 New York, NY 10007 gabriel.colwell@squirepb.com
(212) 356-2032 colin.jennings@squirepb.com
6 eproshan@law.nyc.gov mike.hanna@squirepb.com
hlu@law.nyc.gov emily.spivack@squirepb.com
7 grubin@law.nyc.gov CLEVELAND MUNICIPAL SCHOOL DISTRICT
Attorneys for Plaintiff the Board of BOARD OF EDUCATION
8 Education of the City School District of the KEVIN J. BURTZLAFF (OHBN 0039648)
City of New York Board Attorney and Liaison
9 1111 Superior Ave E
BOARD OF EDUCATION, CITY OF CHICAGO Cleveland, OH 44114
10 DEPARTMENT OF LAW (216) 838-0032
JOSEPH MORIARTY kevin.burtzlaff@clevelandmetroschools.org
11 General Counsel Attorneys for Plaintiff Cleveland Municipal
J. ERNEST MINCY School District Board of Education
12 Deputy General Counsel for Litigation
1 North Dearborn Street, Suite 900 SAN FRANCISCO UNIFIED SCHOOL DISTRICT
13 Chicago, IL 60602 DANIELLE HOUCK
(773) 553-1693 General Counsel
14 jemincy1@cps.edu SUSANNE NAOMI STARECKI KIM
Attorneys for Plaintiff Chicago Board of Sr. Deputy General Counsel
15 Education LEGAL DEPARTMENT
555 Franklin Street, 3rd Floor
16 San Francisco, CA 94102
(415) 241-6216
17 Kims1@sfusd.edu
Attorneys for Plaintiff San Francisco Unified
18 School District
19
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22
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First Amended Complaint for Declaratory and Injunctive Relief
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1 INTRODUCTION
2 1. The State of Michigan, the State of California, the District of Columbia, the State of
3 Hawaii, the State of Maine, the State of Maryland, the State of New Mexico, the Commonwealth
4 of Pennsylvania, and the State of Wisconsin (collectively, Plaintiff States or the States), the Board
5 of Education of the City School District of the City of New York (New York City Department of
6 Education), Board of Education for the City of Chicago, Cleveland Municipal School District
7 Board of Education, and San Francisco Unified School District (collectively, Plaintiff LEAs) (and
8 collectively with Plaintiff States, Plaintiffs) bring this action to challenge a rule promulgated by
9 Defendants Secretary Elisabeth D. DeVos and the United States Department of Education (the
10 Department) (collectively, Defendants), unlawfully and erroneously interpreting the Coronavirus
11 Aid, Relief, and Economic Security Act (CARES Act), Public Law 116–136, 134 Stat. 281. The
12 Department’s interpretation will deprive low-income and at-risk students, their teachers, and the
13 public schools that serve them of critical resources to meet students’ educational and social-
14 emotional needs during and after pandemic-related school closures. Plaintiffs will also be harmed
15 by the loss of these critical resources at a time of severe crisis.
16 2. The CARES Act was enacted on March 27, 2020, to address some of the financial
17 challenges faced by Americans as businesses closed, employees lost their jobs, and schools closed
18 their buildings and transitioned to remote learning in an unprecedented effort to slow the spread
19 of the virus. The statute authorizes the allocation of $30.75 billion for elementary and secondary
20 schools and higher education in response to the COVID-19 pandemic, including assisting students
21 to transition to distance learning. The statute directs states to distribute CARES Act funds to
22 local educational agencies (LEAs) in proportion to their allocation under part A of Title I of the
23 Elementary and Secondary Education Act of 1965 (ESEA) in the previous fiscal year. Title I-A
24 funds are allocated to LEAs and schools based on the number of children who are economically
25 disadvantaged. These funds benefit many of the vulnerable students whom the Plaintiff States
26 and LEAs serve, including children with disabilities, migrant children, English language learners,
27 children in residential or day programs for students in the foster care or juvenile justice systems,
28 and homeless children.
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1 3. Congress directed LEAs to use a portion of the funds they receive from the CARES
2 Act to provide equitable services to eligible private-school students and teachers in the same
3 manner as provided under Section 1117 of the ESEA. CARES Act § 18005. Under Section
4 1117, LEAs calculate the amount of Title I-A funds reserved for equitable services based on the
5 number of low-income students who attend private schools as a percentage of the total number of
6 low-income students in public and private schools combined. Once the money is apportioned, the
7 LEA then provides equitable services to private-school students who are academically at-risk.
8 4. Section 1117 is clear that LEAs are to use Title I-A funds to provide services to at-
9 risk private-school students, and neither Section 1117 nor the CARES Act allows the funds at
10 issue to be used to provide equitable services to all students enrolled in private schools. Yet,
11 despite these clear mandates and contrary to the will of Congress, the Department grafted its own
12 allocation and eligibility rules on Congress’s directive.
13 5. The Department first issued its interpretation of how LEAs should apportion the
14 CARES Act moneys and which private-school students were eligible for equitable services on
15 April 30, 2020, through a guidance document (Guidance Document).1 The Guidance
16 Document—which was inconsistent with prior Title I guidance issued by the Department less
17 than a year ago—provided that LEAs must apportion funds for equitable services using the total
18 numbers of private and public-school students rather than only low-income students. If every
19 LEA receiving CARES Act funds were required to apportion CARES Act funds in this manner,
20 millions of dollars in CARES Act funding would be diverted from their public schools to the
21 private schools. In addition, the Guidance Document directed LEAs to provide equitable services
22 to all private-school students, regardless of whether the private-school students were low income,
23 were academically at-risk of failing, or resided in Title I school attendance areas. Neither of these
24 mandates is consistent with Section 1117.
25
26 1
The Guidance Document is attached hereto as Exhibit A. The Department removed this
27 original version of the Guidance Document from its website and has posted a different version of
the Guidance Document, available at https://oese.ed.gov/files/2020/06/Providing-Equitable-
28 Services-under-the-CARES-Act-Programs-Update-6-25-2020.pdf.
2
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1 6. After widespread pushback regarding the Department’s incorrect and unlawful
2 guidance, the Department doubled-down on its erroneous interpretation of the CARES Act with
3 the publication of an interim final rule entitled Providing Equitable Services to Students and
4 Teachers in Non-public Schools, 85 Fed. Reg. 39,479 (July 1, 2020) (the Equitable Services Rule
5 or Rule).2 The Rule was published as an interim final rule, which is effective upon publication.
6 7. Contrary to the Act, the Department’s Rule requires LEAs to make an untenable
7 choice about how to apportion the CARES Act funds for private-school students, with neither
8 option supported by the relevant statutes: (1) follow the same interpretation contained in the
9 Guidance Document by apportioning funds for equitable services based on the number of all
10 private school children enrolled, rather than low-income private school children as required by
11 Section 1117; or (2) apportion funds for equitable services based on the number of low-income
12 non-public school children, as required under Section 1117, but then incur strict, poison-pill
13 requirements found nowhere in the CARES Act on how the public-school share of the funds can
14 be used. Under either option, all private-school students would still be eligible to receive
15 equitable services, which negates the eligibility requirements for services in Section 1117.
16 8. The first poison-pill “option” for LEAs prohibits them from using the public-school
17 share of the funds for any non-Title I schools. As a result, depending on the district, numerous
18 schools—which, despite not being designated as Title I schools, serve many low-income and at-
19 risk students—are excluded from receiving any funds. This restriction cannot square with the
20 flexibility Congress provided to LEAs to use the funds for all schools in their districts, not only
21 Title I schools. The second requirement cautions the LEAs from using the funds in a way that
22 would result in other federal funds “supplant[ing],” rather than “supplement[ing],” traditional
23 school funding from state and local sources. In effect, this second requirement prohibits many
24 LEAs from using CARES Act funds for existing expenditures, which is nonsensical since filling
25 the gap created by reduced state and local funding is a key purpose of the CARES Act funding.
26 These two poison pill restrictions on the use of the CARES Act funds penalize LEAs for
27
2
28 The Rule is attached hereto as Exhibit B.
3
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1 following the proportional share calculation in Section 1117 (and required by the CARES Act),
2 and push LEAs to apportion funds in accordance with the Department’s Guidance Document—
3 forcing LEAs to grant a higher proportion of funds to private schools, contrary to the CARES
4 Act’s clear mandate. They also undermine the flexibility that Congress intended to grant LEAs
5 when it enacted a broad set of permitted uses for CARES Act funds, which expressly include
6 maintaining continuity of services and continuing to employ existing staff of the local educational
7 agency. See CARES Act §§ 18002(c)(1), 18003(d)(12).
8 9. The Rule is thus inconsistent with and not in accordance with the law. The
9 discrepancy between the plain language of the CARES Act and the Department’s inaccurate
10 interpretations has led to widespread confusion for State Education Agencies (SEAs), LEAs, and
11 private schools across the Nation. The Rule strips funds Congress specifically directed to public
12 schools to support their response to the COVID-19 pandemic and requires that those funds be
13 reallocated, including to affluent private schools, with consideration neither of the private
14 schools’ needs or available resources nor the harms these reallocations cause to public schools.
15 While Congress intended to provide some assistance to private-school students and teachers
16 through the inclusion of equitable services, it intended that assistance go to vulnerable students
17 and used the Title I-A formula and equitable services requirement applicable to those funds to
18 that end.
19 10. The CARES Act does not expressly delegate to the Department the authority to
20 promulgate administrative rules that interpret, let alone completely re-write, the Act’s allocation
21 requirements for moneys provided to private-school students. Nor does the Department’s general
22 rulemaking authority, see 20 U.S.C. § 1221e-3, allow it to impose these restrictions.
23 11. Because Congress unambiguously directed the allocation of money in accordance
24 with Title I-A, Congress neither explicitly nor implicitly left any gaps in the statute that might
25 justify rulemaking by the Department. The Department’s guidance and the Rule are accordingly
26 entitled to no deference.
27 12. The Rule is arbitrary and capricious in several respects.
28
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1 13. First, as discussed above, the Department failed to articulate how its position
2 comports with the plain text of section 18005 of the CARES Act. Thus, it must be set aside as
3 based on an incorrect legal premise. See Safe Air for Everyone v. U.S. EPA, 488 F.3d 1088, 1101
4 (9th Cir. 2007).
5 14. Second, the Department failed to adequately explain—consistent with the evidence
6 before it—why it was reversing its own Title I guidance regarding how equitable services under
7 Section 1117 should be provided. See, e.g., Motor Vehicle Mfrs. Ass’n of U.S., Inc. v. State Farm
8 Mut. Auto. Ins. Co., 463 U.S. 29, 52 (1983) (requiring agencies to “explain the evidence which is
9 available, and . . . offer a rational connection between the facts found and the choice made . . .
10 [including] justification for rescinding the regulation”); see also Dep’t of Homeland Sec. v.
11 Regents of the Univ. of Cal., 140 S. Ct. 1891, 1913 (2020) (requiring “reasoned analysis to
12 support” rescission of prior policy) (quoting State Farm, 463 U.S. at 42) (punctuation omitted).
13 15. Third, the Department ignored important aspects of the problem, see State Farm, 463
14 U.S. at 43, including, among others, the harms to students, States, and LEAs discussed herein.
15 For example, the Department failed to consider that communities with Title I-eligible schools are
16 likely to experience a greater concentration of difficulties relating to COVID-19, and that
17 therefore Congress intended the flexible uses of the CARES Act funds to be concentrated in these
18 communities’ schools.
19 16. Fourth, the Department took into account factors Congress did not intend it to
20 consider. See id. For example, the Department’s prioritization of support for all private-school
21 students, even those not Title I-A eligible, appears to be based on the erroneous premise that
22 Congress intended to direct these funds to affluent, economically secure private-school students
23 on an equal basis as public schools that educate large populations of at-risk and low-income
24 students. Congress unambiguously expressed clear intent to the contrary by using the Title I-A
25 allocation method, which tracks low-income students.
26 17. Fifth, the Department failed to take into account the reliance interests that its former
27 position generated. The Plaintiff States and LEAs have relied on the Department’s prior
28 interpretations of Title I equitable services, and there is no indication that the Department took
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1 this into account when making its decision. “When an agency changes course . . . it must be
2 cognizant that longstanding policies may have engendered serious reliance interests that must be
3 taken into account. It would be arbitrary and capricious to ignore such matters.” Regents, 140 S.
4 Ct. at 1913 (citations and punctuation omitted).
5 18. Sixth, the Department’s ever-changing position has generated an “[u]nexplained
6 inconsistency,” and the Department has not shown any awareness of its changed position. Nat’l
7 Cable & Telecomms. Ass’n v. Brand X Internet Servs., 545 U.S. 967, 981 (2005).
8 19. In addition, the Department flouted the procedural steps required under the
9 Administrative Procedure Act (APA) for the promulgation of the Rule, as the Department did not
10 have good cause for issuing the Rule as an interim final rule. 5 U.S.C. § 553(b)(B); see, e.g.,
11 California v. Azar, 911 F.3d 558, 576 (9th Cir. 2018) (“[A]n agency’s desire to eliminate more
12 quickly legal and regulatory uncertainty is not by itself good cause.”).
13 20. The Rule also violates core separation of powers principles in the Constitution.
14 “[W]here previously appropriated money is available for an agency to perform a statutorily
15 mandated activity,” separation of powers principles and the Spending Clause prevent agencies
16 from “ignor[ing] statutory mandates or prohibitions.” In re Aiken County, 725 F.3d 255, 260
17 (D.C. Cir. 2013); see also City & Cty. of San Francisco v. Trump, 897 F.3d 1225, 1232 (9th Cir.
18 2018) (agencies are without “[the] unilateral authority” to “thwart congressional will by canceling
19 appropriations passed by Congress”) (internal quotation marks and citations omitted). Congress
20 intended to deliver LEAs “need[ed] funding flexibility due to the disruption in the academic year
21 from COVID-19.” 166 Cong. Rec. H1856 (Mar. 27, 2020) (statement of Rep. Underwood).
22 Congress intended that LEAs have this funding to “help alleviate the challenges educators,
23 students and families are struggling with in light of school closures” particularly those “students
24 with disabilities, English language learners, and students experiencing homeless.” 166 Cong.
25 Rec. E340 (Mar. 31, 2020) (statement of Rep. Jayapal).
26 21. Relatedly, the Rule violates the Spending Clause: (1) it is contrary to Congress’s
27 plainly expressed intent in the CARES Act; (2) Congress has not “unambiguously” imposed the
28 requirements of the Rule, South Dakota v. Dole, 483 U.S. 203, 207 (1987) (internal citations
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1 omitted, brackets in original); and (3) it is an improper “post acceptance” restriction on the States’
2 and LEAs’ use of the funds, Pennhurst State Sch. & Hosp. v. Halderman, 451 U.S. 1, 25 (1981).
3 22. Further, the additional funding requirements on schools that the Department would
4 impose under one of the so-called “choices” provided in the Rule violate the plain language of the
5 CARES Act requiring that funds be allocated in the same manner as required in Section 1117 and
6 specifying that funds could be used to maintain existing operations and retain existing personnel.
7 The Department’s allocation scheme will dilute the per-pupil amount available to all public
8 schools by directing CARES Act funds to support private-school students not eligible for
9 equitable services.
10 23. To avert irreparable injury to the Plaintiff States, Plaintiff LEAs, and the students,
11 teachers, and schools within their states and school districts, Plaintiffs bring this suit to declare
12 unlawful and enjoin the Department’s Guidance Document and the Rule.
13 JURISDICTION AND VENUE
14 24. This action arises under the APA, 5 U.S.C. §§ 553, 701-06, and the U.S. Constitution.
15 This Court has subject matter jurisdiction under 28 U.S.C. §§ 1331 and 1346.
16 25. This Court has the authority to issue declaratory relief, injunctive relief, and other
17 relief pursuant to the Declaratory Judgment Act, 28 U.S.C. §§ 2201-02, and the APA, 5 U.S.C. §§
18 702, 705-06.
19 26. This is a civil action in which Defendants are agencies of the United States or officers
20 of such an agency. Venue is proper in this Court because a substantial part of the events giving
21 rise to this action occurred in this district. See 28 U.S.C. § 1391(e)(1).
22 PLAINTIFFS
23 27. Plaintiff State of Michigan is a sovereign state of the United States of America. This
24 action is being brought on behalf of the State by Attorney General Dana Nessel pursuant to her
25 statutory authority. Mich. Comp. Laws § 14.28.
26 28. Plaintiff State of California is a sovereign state of the United States of America. This
27 action is being brought on behalf of the State by California Attorney General Xavier Becerra, the
28 State’s chief law officer, Cal. Const., art. V, § 13, who has the duty to see that the laws of the
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1 State are uniformly and adequately enforced, and Governor Gavin Newsom, the State’s chief
2 executive officer, who is responsible for overseeing the operations of the State and ensuring that
3 its laws are faithfully executed, Cal. Const., art. V, § 1.
4 29. Plaintiff District of Columbia is a sovereign municipal corporation organized under
5 the Constitution of the United States. It is empowered to sue and be sued, and it is the local
6 government for the territory constituting the permanent seat of the federal government. The
7 District is represented by and through its chief legal officer, the Attorney General for the District
8 of Columbia, Karl A. Racine. The Attorney General has general charge and conduct of all legal
9 business of the District and all suits initiated by and against the District and is responsible for
10 upholding the public interest. D.C. Code § 1-301.81.
11 30. Plaintiff State of Hawaii is a sovereign state of the United States of America. The
12 Attorney General is the chief legal officer and chief law enforcement officer of the State of
13 Hawaii. The Attorney General’s powers and duties include appearing for and representing the
14 State “in all the courts of record, in all cases criminal or civil in which the State may be a party, or
15 be interested, and may in like manner appear in the district courts in such cases.” Haw. Rev. Stat.
16 § 28-1. Hawaii is represented by its Attorney General, Clare E. Connors, who is authorized to file
17 civil actions to protect Hawaii’s rights and interests in state and federal courts.
18 31. Plaintiff State of Maine is a sovereign state of the United States of America. The
19 Attorney General of Maine, Aaron M. Frey, is a constitutional officer with the authority to
20 represent the State of Maine in all matters and serves as its chief legal officer with general charge,
21 supervision, and direction of the State’s legal business. Me. Const. art. IX, § 11; Me. Rev. Stat.,
22 tit. 5, §§ 191 et seq. The Attorney General’s powers and duties include acting on behalf of the
23 State and the people of Maine in the federal courts on matters of public interest. The Attorney
24 General has the authority to file suit to challenge action by the federal government that threatens
25 the public interest and welfare of Maine residents as a matter of constitutional, statutory, and
26 common-law authority.
27 32. Plaintiff State of Maryland is a sovereign state of the United States of America. The
28 State is represented by and through the Attorney General of Maryland, its chief legal officer with
8
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1 general charge, supervision, and direction of the State’s legal business. The Attorney General’s
2 powers and duties include acting on behalf of the State and the people of Maryland in the federal
3 courts on matters of public concern. Under the Constitution of Maryland, and as directed by the
4 Maryland General Assembly, the Attorney General has the authority to file suit to challenge
5 action by the federal government that threatens the public interest and the welfare of Maryland
6 residents. Md. Const. art. V, § 3(a)(2); 2017 Md. Laws, Joint Resolution 1.
7 33. Plaintiff State of New Mexico is a sovereign state of the United States of America.
8 New Mexico is represented by its Attorney General, Hector Balderas, who is authorized to assert
9 the State’s interests in state and federal courts.
10 34. Plaintiff the Commonwealth of Pennsylvania is a sovereign state of the United States
11 of America. This action is brought on behalf of the Commonwealth by Attorney General Josh
12 Shapiro, the “chief law officer of the Commonwealth.” Pa. Const. art. IV, § 4.1. Attorney
13 General Shapiro brings this action on behalf of the Commonwealth pursuant to his statutory
14 authority under 71 Pa. Stat. § 732-204.
15 35. Plaintiff State of Wisconsin is a sovereign state of the United States of America and
16 brings this action by and through its Attorney General, Joshua L. Kaul, who is the chief legal
17 officer of the State of Wisconsin and has the authority to file civil actions to protect Wisconsin’s
18 rights and interests. See Wis. Stat. § 165.25(1m). The Attorney General’s powers and duties
19 include appearing for and representing the State, on the governor’s request, “in any court or
20 before any officer, any cause or matter, civil or criminal, in which the state or the people of this
21 state may be interested.” Id.
22 36. Plaintiff Board of Education of the City School District of the City of New York
23 (a/k/a the New York City Department of Education and hereafter the NYCDOE) is a city school
24 district governed by Article 52-A of New York Education Law. NYCDOE is the largest public
25 school district in the nation. It serves about 1.1 million students in approximately 1,600 schools.
26 The NYCDOE has standing to bring this action because the Rule harms the NYCDOE’s
27 economic and proprietary interests, and inhibits its ability to provide its students, teachers, and
28
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1 schools the essential support and services needed during and in response to the COVID-19
2 pandemic.
3 37. Plaintiff Board of Education for the City of Chicago (CBOE), also known as the
4 Chicago Public Schools (CPS), is a city school district governed by the School Code of the State
5 of Illinois. CBOE is the third largest public-school district in the nation. It serves about 360,000
6 students in approximately 600 schools. The CBOE has standing to bring this action because the
7 Rule harms the CBOE’s economic and proprietary interests, and inhibits its ability to provide its
8 students, teachers, and schools the essential support and services needed during and in response to
9 the COVID-19 pandemic.
10 38. Plaintiff Cleveland Municipal School District Board of Education (CMSD) is a
11 municipal school district governed by Title 33 of the Ohio Revised Code. CMSD is the second-
12 largest school district in Ohio, serving approximately 37,700 students in 103 schools. CMSD has
13 been a leader in innovating creative approaches to urban education, and has developed extensive
14 partnerships with its community to further its students’ success. CMSD has standing to bring this
15 action because the Rule harms CMSD’s economic and proprietary interests, and interferes with its
16 ability to provide its students, teachers, schools and community the essential support and services
17 needed during and in response to the COVID-19 pandemic.
18 39. Plaintiff San Francisco Unified School District (SFUSD or San Francisco) is a LEA
19 and one of the largest school districts in California, operating pursuant to the laws of the State of
20 California. SFUSD serves approximately 52,468 students, of whom 28,556 are
21 socioeconomically disadvantaged, 15,028 are English Learners, 2,064 are homeless, 6,275 are
22 students with disabilities, and 254 are foster youth. SFUSD oversees approximately 133 schools
23 of which about 53 qualify as Title I schools. SFUSD’s offices are located on Franklin Street in
24 San Francisco, California.
25 40. In filing this action, Plaintiffs seek to redress harms to their interests as recipients of
26 CARES Act emergency relief funding. Plaintiffs are affected by the Department’s interpretation
27 of the CARES Act through the Rule and Guidance Document, are directly injured by them, and
28 the relief requested will redress their injuries.
10
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1 DEFENDANTS
2 41. Defendant Elisabeth D. DeVos is Secretary of the United States Department of
3 Education and is sued in her official capacity pursuant to 5 U.S.C. § 702. Her principal address is
4 400 Maryland Avenue, S.W., Washington, D.C. 20202.
5 42. Defendant the United States Department of Education is an executive agency of the
6 United States of America pursuant to 5 U.S.C. § 101, and a federal agency within the meaning of
7 28 U.S.C. § 2671. As such, it engages in agency action and is named as a defendant in this action
8 pursuant to 5 U.S.C. § 702. Its principal address is 400 Maryland Avenue, S.W., Washington,
9 D.C. 20202.
10 43. Secretary DeVos is responsible for carrying out the duties of the Department of
11 Education under the Constitution of the United States of America and relevant statutes, including
12 the CARES Act and the ESEA.
13 FACTUAL ALLEGATIONS
14 I. COVID-19 PANDEMIC
15 44. COVID-19 is a public health emergency that has caused and continues to have
16 devastating impacts on countless individuals, families, communities, businesses, and
17 governments. Our Nation’s educational agencies and school systems have had to respond
18 urgently to the crisis and take drastic measures to protect the health and safety of their students
19 and staff.
20 45. Plaintiffs’ educational agencies and school districts have been forced to transition to
21 remote delivery of instruction, implement new health and safety guidelines, and meet the novel
22 and challenging needs of their students arising from the pandemic, including supports for their
23 vulnerable populations beyond the provision of core educational services. These efforts include,
24 but are not limited to, serving meals to qualifying students and families; providing special
25 education and related services to students with disabilities remotely; enabling English learners
26 and migrant students to access remote learning by providing accessible technology, online
27 instruction and translations; and offering computing devices and connectivity to low-income
28 students at no cost.
11
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1 46. Compounding the programmatic challenges in serving students during the pandemic
2 is the uncertainty and economic stress caused by COVID-19 on the Plaintiff States, their SEAs,
3 and LEAs. Public education largely depends on state funding. State budgets have been hit hard
4 by dramatic reductions in revenues from state sales and income taxes caused by the COVID-19
5 pandemic, as well as increased expenditures necessary for the public health response. This
6 revenue decline inevitably impacts the amount of state aid available to school districts. And yet,
7 school districts have incurred and will incur significant costs related to the pandemic, including
8 paying for deep-cleaning campuses, obtaining personal protective equipment for employees,
9 purchasing distance learning materials as well as new software and hardware, and preparing and
10 delivering meals to students and families.
11 II. THE CARES ACT
12 47. In late March 2020, the United States Congress acted to address the fiscal impact of
13 the COVID-19 outbreak. It passed legislation, signed by the President, including appropriations
14 to federal agencies with explicit direction for distributing the funding.
15 48. The Coronavirus Aid, Relief, and Economic Security Act (CARES Act), Pub. L. No.
16 116–136, 134 Stat. 281, enacted on March 27, 2020, appropriated funds for K-12 and higher
17 education in response to the economic impact of the COVID-19 pandemic.
18 49. Specifically, Congress created the Education Stabilization Fund to help educational
19 entities across the country “prevent, prepare for, and respond to coronavirus,” and appropriated
20 $30.75 billion for the Fund. CARES Act § 18001.
21 50. Congress tasked the Department with allocating the moneys appropriated to the
22 Education Stabilization Fund through the CARES Act. The vast majority of the moneys in the
23 Education Stabilization Fund are divided into three separate funds, each with its own rules for
24 distribution and use: the Governor’s Emergency Education Relief Fund (GEER), the Elementary
25 and Secondary School Emergency Relief Fund (ESSER), and the Higher Education Emergency
26 Relief Fund. Id. §§ 18002-18004. The funds are allocated as follows: 9.8% for GEER; 43.9% for
27 ESSER; and 46.3% for the Higher Education Emergency Relief Fund. Id. § 18001(b)(1)-(3).
28
12
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1 51. According to the Department’s website, $2,953,230,000 was allocated for the GEER
2 Fund and $13,229,265,000 for the ESSER Fund.3
3 A. The Governor’s Emergency Education Relief (GEER) Fund
4 52. The CARES Act directs the Department to provide emergency grants from the GEER
5 Fund to state governors. CARES Act § 18002(a).
6 53. The Department must allocate the GEER Fund moneys to governors as follows: (1)
7 60% based on the “relative population of individuals aged 5 through 24” in each state, and (2)
8 40% based on the state’s “relative number of children counted under section 1124(c) of the
9 [ESEA].” Id. § 18002(b). Section 1124(c) of the ESEA describes the children to be counted for
10 purposes of distributing funds under Part A, Title I of the ESEA, commonly referred to as Title I-
11 A funds. Children to be counted in this section include children 5 to 17 who are “from families
12 below the poverty level,” “in institutions for neglected and delinquent children . . . or being
13 supported in foster homes with public funds,” and “from families above the poverty level” but
14 who receive payments under the Social Security Act, Title IV, Part A (Temporary Assistance for
15 Needy Families). 20 U.S.C. § 6333(c)(1)(A)-(C), (c)(4)(A).
16 54. Governors, along with SEAs, may use GEER funds for three purposes:
17 (1) To provide emergency support through grants to local educational agencies
that the State educational agency deems have been most significantly impacted by
18 coronavirus to support the ability of such local educational agencies to continue to
provide educational services to their students and to support the on-going
19 functionality of the local educational agency;
20 (2) To provide emergency support through grants to institutions of higher
education serving students within the State that the Governor determines have been
21 most significantly impacted by coronavirus to support the ability of such institutions
to continue to provide educational services and support the ongoing functionality of
22 the institution; and
23 (3) To provide support to any other institution of higher education, local
educational agency, or education-related entity within the State that the Governor
24 deems essential for carrying out emergency educational services to students for
authorized activities . . . the provision of child care and early childhood education,
25 social and emotional support, and the protection of education-related jobs.
26 3
U.S. Dep’t of Educ., Governor’s Emergency Education Relief Fund, State Allocation
27 Table, available at https://oese.ed.gov/files/2020/04/GEER-Fund-State-Allocations-Table.pdf;
U.S. Dep’t of Educ., Elementary and Secondary School Emergency Relief Fund, State Allocation
28 Table, available at https://oese.ed.gov/files/2020/04/ESSER-Fund-State-Allocations-Table.pdf.
13
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1 CARES Act § 18002(c)(1)-(3).
2 55. While they are directed per the above criteria to focus the GEER funds on the most
3 significantly impacted districts, governors may allocate moneys from the GEER Fund to any
4 LEA, regardless of whether the LEA or its public schools receive Title I-A funds. Moreover,
5 there are no federal restrictions on the use of funds by the LEAs and any other restrictions on the
6 use of funds is left to the discretion of each state. The CARES Act provides broad flexibility to
7 the LEAs to use the moneys “to provide educational services to their students and to support the
8 on-going functionality of the local educational agency.” Id. § 18002(c)(1), (3).
9 56. Plaintiffs expect to receive the following amounts from the GEER Fund:4
10 a. Michigan: $89,432,673;
11 b. California: $355,227,235;
12 c. District of Columbia: $5,807,678;
13 d. Hawaii: $9,993,387;
14 e. Maine: $9,273,552;
15 f. Maryland: $45,657,990;
16 g. Pennsylvania: $104,418,240;
17 h. New Mexico: $22,262,663;
18 i. Wisconsin: $46,550,411;
19 j. New York City: $98,000,000; and
20 k. San Francisco: $3,300,000 (estimated).
21 At this time, it is unclear the amount of GEER funds, if any, that Chicago or Cleveland will
22 receive.
23 B. Elementary and Secondary School Emergency Relief (ESSER) Fund
24 57. Through the CARES Act, Congress also directed the Department to provide
25 emergency grants from the ESSER Fund to SEAs. CARES Act § 18003(a).
26
27
4
28 GEER State Allocation Table, supra note 3.
14
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1 58. The Department is required to allocate the ESSER Fund moneys to SEAs “in the
2 same proportion as each State received under [Title I-A] in the most recent fiscal year.” Id. §
3 18003(b). Allocation of Title I-A funds to States is governed by the formulas included in 20
4 U.S.C. §§ 6332-39, and is based primarily on the numbers of children from low-income families
5 and foster children in each state’s LEAs.
6 59. The CARES Act requires at least 90 percent of the moneys received by the SEAs
7 from the ESSER Fund to be sub-granted to LEAs within the state. Id. § 18003(c). Like the
8 Department’s allocation to the states, the SEAs are to sub-grant the funds to LEAs “in proportion
9 to the amount of funds such local educational agencies and charter schools that are local
10 educational agencies received under [Title I-A] in the most recent fiscal year.” Id.
11 60. The Department issued guidance on May 8, 2020 discussing the ESSER allocations
12 and LEAs’ eligibility, which acknowledged that LEAs are only eligible for the ESSER funding to
13 the extent they participate in the Title I-A program.5 In other words, moneys from the ESSER
14 Fund are designated, through the SEAs, for LEAs that receive Title I-A funds, which in turn
15 support those public schools with populations of economically-disadvantaged children in each
16 state. LEAs that do not receive Title I-A funds (generally, LEAs without significant numbers of
17 low-income students) are not eligible for the ESSER Funds.
18 61. LEAs may use the moneys from the ESSER Fund for twelve broad purposes, as
19 described in the CARES Act. See CARES Act § 18003(d). Like the GEER Fund, there are no
20 restrictions in the statutory language on which schools within the eligible LEAs may receive the
21 funds, regardless of whether the public school receives Title I-A funds. These funds can be used
22 for expressly broad purposes, including “[o]ther activities that are necessary to maintain the
23 operation of and continuity of services in [LEAs] and continuing to employ existing staff of the
24 [LEA],” i.e., to support any operation, service, or staff existing prior to the pandemic. Id. §
25 18003(d)(12).
26 5
U.S. Dep’t of Educ., Frequently Asked Questions about the Elementary and Secondary
27 School Emergency Relief Fund (ESSER) (May 5, 2020), available at
https://oese.ed.gov/files/2020/05/ESSER-Fund-Frequently-Asked-Questions.pdf.
28
15
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1 62. For the SEAs to receive the ESSER funds from the Department, the Plaintiff States’
2 SEAs were required to complete and submit a Certification and Agreement form.6
3 63. Within the Certification and Agreement form, the Plaintiff SEAs are required to:
4 [A]cknowledge and agree that the failure to comply with all Assurances and
Certifications in this Agreement, all relevant provisions and requirements of the
5
CARES Act, Pub. L. No. 116-136 (March 27, 2020), or any other applicable law or
6 regulation may result in liability under the False Claims Act, 31 U.S.C. § 3729, et
seq.; OMB Guidelines to Agencies on Governmentwide Debarment and Suspension
7 (Nonprocurement) in 2 CFR part 180, as adopted and amended as regulations of the
Department in 2 CFR part 3485; and 18 USC § 1001, as appropriate.
8
Certification and Agreement at 1.
9
64. Within the specific assurances and certifications, the SEAs are required to ensure
10
that:
11
[] LEAs receiving ESSER funds will provide equitable services to students and
12 teachers in non-public schools as required under 18005 of Division B of the CARES
Act.
13
[] [A]n LEA receiving ESSER funds will provide equitable services to students and
14 teachers in non-public schools located within the LEA in the same manner as
provided under section 1117 of the ESEA, as determined through timely and
15 meaningful consultation with representatives of non-public schools.
16 Id. at 2.
17 65. Each of the Plaintiff States’ SEAs submitted a Certification and Agreement to the
18 Department to secure the ESSER Funds for their states.
19 66. The Department also requires SEAs to submit quarterly reporting regarding how the
20 SEA and the LEAs used the ESSER funds. Id. at 3; see also CARES Act § 15011(b)(2).
21 67. From the ESSER Fund, Plaintiffs each received or expect to receive the following
22 amounts:7
23 a. Michigan: $389,796,984;
24 b. California: $1,647,306,127;
25
6
U.S. Dep’t of Educ., Certification and Agreement for Funding under the Education
26 Stabilization Fund Program Elementary and Secondary School Emergency Relief Fund (ESSER
Fund), CFDA Number 84.425D (Apr. 24, 2020), available at
27 https://oese.ed.gov/files/2020/04/ESSERF-Certification-and-Agreement-2.pdf.
7
28 ESSER State Allocation Table, supra note 3.
16
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1 c. District of Columbia: $42,006,354;
2 d. Hawaii: $43,385,229;
3 e. Maine: $43,793,319;
4 f. Maryland: $187,050,652;
5 g. New Mexico: $108,574,786;
6 h. Pennsylvania: $523,807,198;
7 i. Wisconsin: $174,777,774;
8 j. New York City: $619,000,000;
9 k. Chicago: $206,000,000 (estimated);
10 l. Cleveland: $31,200,000; and
11 m. San Francisco: $10,511,000 (estimated).
12 C. Equitable Services for Private-School Students and Teachers Required by
the CARES Act.
13
14 68. The CARES Act requires that LEAs that receive moneys from the GEER Fund and/or
15 ESSER Fund must allocate some of the moneys to provide “equitable services” to students and
16 teachers at private schools. CARES Act § 18005(a). Crucial to this action, the CARES Act
17 specifies that each LEA “shall provide equitable services in the same manner as provided under
18 Section 1117 of the ESEA of 1965 to students and teachers in non-public schools.” Id. (emphasis
19 added).
20 69. Section 1117 of the ESEA, 20 U.S.C. § 6320, requires LEAs to allocate a portion of
21 their Title I-A funds to provide equitable services to eligible students and teachers at private
22 schools. Section 1117 calculates the proportionate share of funds to be used for equitable
23 services “based on the number of children from low-income families who attend private schools”
24 and reside in the “participating school attendance areas” (i.e., the geographic area in which
25 children are normally served by a Title I-A school). 20 U.S.C. § 6320(a)(4)(A); see also 20
26 U.S.C. § 6313(a)(2) (defining “school attendance area”). Services are then provided to those
27 private-school students identified “as failing, or most at risk of failing, to meet State academic
28 standards.” 20 U.S.C. § 6320(a) (incorporating the definition of “eligible children” from 20
17
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1 U.S.C. § 6315(c)). In other words, the LEAs must provide equitable services only to low-
2 achieving children who attend private schools and reside in a Title I-A school attendance area.
3 Id. §§ 6315(c), 6320(a).
4 70. The Department’s Title I-A guidance for providing equitable services under Section
5 1117 to private-school students—issued under the current administration less than a year ago—
6 confirms that equitable services should only be provided to at-risk students who reside in Title I
7 public school attendance areas. As stated in that document: “to be eligible for Title I services, a
8 private school child must reside in a participating Title I public school attendance area and must
9 be identified by the LEA as low achieving on the basis of multiple, educationally related,
10 objective criteria.”8
11 71. While services are based on low-achievement and residence in a Title I-A school
12 attendance area, the amount of money LEAs are required to set aside under Section 1117 of the
13 ESEA is based on the number of economically disadvantaged students attending private schools
14 who reside in the LEA’s attendance area. 20 U.S.C. § 6320(c).
15 72. Again, it has been the Department’s own position that, under Section 1117 of the
16 ESEA, funding for equitable services should be based on the number of children in private
17 schools who are economically disadvantaged or in foster care—the LEAs should “determine an
18 accurate count of children from low-income families who attend public and private schools and
19 reside in participating Title I public school attendance areas in order to allocate the proportional
20 share.”9
21 73. Notably, the CARES Act does not require that LEAs provide equitable services in the
22 same manner as Section 8501 of the ESEA, a general provision that measures equitable services
23 based on proportional total enrollments. 20 U.S.C. § 7881(b). Rather, the CARES Act
24 specifically references Section 1117. By referencing Section 1117, Congress explicitly and
25 8
U.S. Dep’t of Educ., Title I, Part A of the Elementary and Secondary Education Act of
1965, as amended by the Every Student Succeeds Act: Providing Equitable Services to Eligible
26 Private School Children, Teachers, and Families Updated Non-Regulatory Guidance (Oct. 7,
2019), p. 30, available at https://www2.ed.gov/about/inits/ed/non-public-
27 education/files/equitable-services-guidance-100419.pdf.
9
28 Id. at 19.
18
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1 clearly directed LEAs to provide equitable services only based on the number of low-income
2 private-school students, not all private-school students, as would have been required had the
3 CARES Act instead referenced Section 8501.
4 III. THE DEPARTMENT’S APRIL 30, 2020 GUIDANCE DOCUMENT
5 74. On April 30, 2020, the Department issued the Guidance Document, titled Providing
6 Equitable Services to Students and Teachers in Non-Public Schools Under the CARES Act
7 Programs. See Guidance Document, Ex. A.
8 75. The Guidance Document advises LEAs to (i) determine the allocation of funds for
9 equitable services based on all students enrolled in non-public schools, rather than only
10 economically disadvantaged students, and (ii) ignore Section 1117’s eligibility requirements for
11 private-school students to receive services, including residence in a Title I-A school attendance
12 area and low achievement.
13 A. Determining the Proportional Share of Funds to Be Reserved for Equitable
Services
14
15 76. In section 10 of the Guidance Document, the Department incorrectly states that an
16 LEA must calculate the proportional share available for equitable services from the comparative
17 enrollments of all students in public and private schools in the district, rather than the
18 comparative enrollments of low-income students, as required by Section 1117(a)(4)(A)(i).
19 Guidance Document, Ex. A at 6-7; see also 20 U.S.C. § 6320(a)(4)(A)(i).
20 77. Essentially, the guidance rejects the calculation of the proportionate share under
21 Section 1117 that Congress specified in the CARES Act and instead adopts the calculation in
22 Section 8501, which drastically inflates the amount of CARES Act funds required to be allocated
23 for services for private-school students and decreases the amount of CARES Act funds available
24 for public-school students.
25 78. Under the Department’s Guidance Document, the share of funds diverted from public
26 schools to private schools in many LEAs is substantial.
27
28
19
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1 B. Eligibility Requirements for Private-School Students to Receive CARES
Act Equitable Services
2
3 79. In section 9 of the Guidance Document, the Department erroneously interprets the
4 CARES Act as requiring that “[a]ll students and teachers in a non-public school are eligible for
5 equitable services under the CARES Act programs.” Guidance Document, Ex. A at 5.
6 80. The Department cites no section of the CARES Act that requires—or even suggests—
7 that all students and teachers at non-public schools are eligible for equitable services.
8 81. The plain language of the CARES Act makes clear that LEAs that receive GEER or
9 ESSER funds must provide equitable services “in the same manner as provided under section
10 1117 of the ESEA.” CARES Act § 18005(a) (emphasis added). And Section 1117 of the ESEA
11 requires LEAs to provide equitable services for eligible, at-risk children enrolled in non-public
12 schools who reside in attendance areas where public schools qualify for Title I-A funding, rather
13 than all students enrolled. 20 U.S.C. § 6320(a)(1).
14 82. Section 7 of the Guidance Document misinterprets the requirement under § 18005(a)
15 of the CARES Act that equitable services be provided “in the same manner as provided under
16 section 1117 of the ESEA.” See Guidance Document, Ex. A at 3-5. Contrary to the Act, this
17 section of the Guidance Document states that this requirement in the CARES Act “necessitates
18 that the Department interpret how the requirements of section 1117 apply to the CARES Act
19 programs” because “an LEA under the CARES Act programs may serve all non-public-school
20 students and teachers without regard to family income, residency, or eligibility based on low
21 achievement.” Id. at 3. But Section 18005(a) of the CARES Act does not necessitate any
22 interpretation by the Department. Instead, the plain language of the Act makes clear that, while
23 LEAs have discretion in spending money for public schools, Congress intended that the LEAs
24 should provide equitable services to private schools under the CARES Act “in the same manner”
25 as they do for at-risk students under Title I-A.
26 83. Also, in section 7 of the Guidance Document, the Department purports to
27 “reconcile[]” various subsections of Section 1117 of the ESEA using an erroneous and
28 incongruous interpretation of the Act. Guidance Document, Ex. A at 3. For example, after noting
20
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1 that Section 1117(a)(1) of the ESEA requires LEAs to “provide equitable services to low-
2 achieving students,” the Department nevertheless states that “an LEA may provide equitable
3 services . . . to any students and teachers in non-public schools.” Id. The Department provides no
4 explanation or basis for this distinction.
5 84. The Guidance Document’s conclusion that the non-public proportion must be
6 calculated based on total enrollments, rather than enrollment of low-income students, and its
7 interpretation of the requirements for equitable services under § 18005(a) of the CARES Act are
8 arbitrary and capricious, misstate and misapply the law as written, and exceed the Department’s
9 authority.
10 C. Reaction to the Department’s Guidance Document
11 85. The Guidance Document faced immediate backlash by Congressional leaders, SEAs,
12 and national education groups due to its incorrect interpretation of the CARES Act.
13 86. On May 5, 2020, the Council of Chief State School Officers (CCSSO), a nationwide
14 organization of public officials who head SEAs, wrote a letter to urge Secretary DeVos to clarify
15 the Guidance Document to align it with the CARES Act’s requirements for equitable services.10
16 The CCSSO’s letter specifically requested that the Department issue new guidance to “advise
17 LEAs to look at the percentage of FY2019 Title I-A funds they set aside for equitable services
18 and apply that percentage to ESSER Funds.”11 Secretary DeVos responded to CCSSO’s letter on
19 May 22, 2020, rejecting its request to clarify the Guidance Document in accordance with the plain
20 text of the CARES Act.12 Secretary DeVos stated that if LEAs “insist on acting contrary to the
21 Department’s stated position, they should, at a minimum, put into an escrow account the
22 difference between the amount generated by the proportional-student enrollment formula and the
23
10
24 Letter from Carissa Moffat Miller, CCSSO, to Betsy DeVos, U.S. Sec’y of Educ. (May
5, 2020), available at https://ccsso.org/sites/default/files/2020-05/DeVosESLetter050520.pdf.
25 11
Id.
12
26 Letter from Betsy DeVos, U.S. Sec’y of Educ., to Carissa Moffat Miller, CCSSO (May
22, 2020), available at https://ccsso.org/sites/default/files/2020-
27 06/Secretary%20DeVos%20Response%20to%20Carrisa%20Moffat%20Miller%205%2022%202
0.pdf.
28
21
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1 Title I, Part A formula.”13 The instruction to put funds in escrow is nonsensical given the crisis,
2 and clearly inconsistent with the intent of the CARES Act, which is to provide funding
3 expeditiously to LEAs to address their immediate needs in light of the COVID-19 pandemic.
4 87. Additionally, multiple SEAs published memoranda and guidance to their LEAs
5 instructing the LEAs to follow the plain text of the CARES Act and not the Department’s
6 Guidance Document.14 For example, on May 12, 2020, the Indiana Department of Education
7 published a memorandum for its LEAs, instructing the LEAs to disregard the Department’s
8 Guidance Document and “enact[] the CARES Act as written in the law . . . including the
9 provision to administer equitable services according to Sec. 1117 of the [ESEA].”15 The
10 memorandum described its decision as “ensur[ing] the funds are distributed according to
11 Congressional intent and a plain reading of the law, which prioritizes communities and schools
12 with high-poverty who are at most risk and in need of additional funds.”16
13 88. On May 20, 2020, Chairman Bobby Scott of the House Committee on Education and
14 Labor; Chairwoman Rosa DeLauro of the House Subcommittee on Labor, Health, Human
15 Services, and Related Agencies; and Ranking Member Patty Murray of the Senate Committee on
16 Health, Education, Labor, and Pensions wrote to Secretary DeVos, to urge the Department to
17 13
Id.
14
18 See, e.g., Penn. Dep’t of Educ., Letter from Pedro Rivera, Sec’y of Educ., to Frank
Brogan, Asst. Sec’y for Elementary and Secondary Educ. (May 7, 2020), available at
19 https://www.education.pa.gov/Documents/K-
12/Safe%20Schools/COVID/CARESAct/Letter%20to%20Secretary%20Brogan.pdf; Mem. from
20 N.M. Pub. Educ. Dep’t, Funds available under Coronavirus Aid, Relief and Economic Security
(CARES) Act through the Elementary and Secondary School Education Relief Fund (ESSER),
21 Index 24301 (May 14, 2020), available at https://webnew.ped.state.nm.us/wp-
content/uploads/2020/05/CARES-Act-memo-ESSER-Funds-2020-05-14-Final.pdf; Miss. Dep’t
22 of Educ., CARES Act Equitable Services, EdUpdate (May 21, 2020), available at
https://msachieves.mdek12.org/cares-act-equitable-services/; Maine Dep’t of Educ., Priority
23 Notice, CARES Act: Frequently Asked Questions (May 27, 2020), available at
https://mailchi.mp/maine/cu5lemq6y0-1321452; Mem. from Ill. St. Board of Educ. (Mar. 31,
24 2020), available at https://www.isbe.net/Documents/CARES-Act-District-Info-3-31-20.pdf;
Mem. from Conn. St. Board of Educ., (June 8, 2020), available at https://portal.ct.gov/-
25 /media/SDE/Digest/2019-20/Equitable-services-under-ESSERF-CARES-Act-06082020.pdf.
15
Mem. from Ind. Dep’t of Educ., Final Language for Equitable Share of CARES Act
26 Funds (May 12, 2020), available at https://www.doe.in.gov/sites/default/files/news/final-
language-equitable-share-cares-act-funds.pdf.
27 16
Id.
28
22
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1 “immediately revise your April 30 guidance, including Question 10 of the guidance document to
2 come into compliance with the CARES Act and section 1117 of ESEA.”17 The bicameral letter
3 also requested the Department’s internal records related to the development of “its interpretation
4 of the equitable services provision and its inconsistency with long-standing requirements related
5 to equitable services.”18
6 89. On May 21, 2020, Senator Lamar Alexander, Chair of the Senate Committee on
7 Health, Education, Labor, and Pensions, was quoted as disagreeing with the Department’s
8 Guidance Document: “My sense was that the money should have been distributed in the same
9 way we distributed Title I money. . . . I think that’s what most of Congress was expecting.”19
10 90. On June 4, 2020, fifty national education organizations, including the CCSSO, wrote
11 to United States Senate and House leaders, asking for Congress to “pass[] legislation rescinding
12 the equitable services [G]uidance [Document], preempting any future notice from [the
13 Department] that is contrary to the legislation, and further clarifying the allocation requirements
14 for equitable services for nonpublic schools consistent with Title I.”20
15 IV. THE RULE
16 91. On June 25, 2020, the Department published an unofficial version of the Rule on its
17 website. The Rule was officially published in the Federal Register on July 1, 2020. 85 Fed. Reg.
18 39,479.
19 92. The Rule was published as an interim final rule and became effective when published.
20
21
22 17
Letter from Robert C. “Bobby” Scott, Chair, Comm. on Educ. and Labor, U.S. H.
Reps., et al., to Betsy DeVos, U.S. Sec’y of Educ. (May 20, 2020), available at
23 https://edlabor.house.gov/imo/media/doc/2020-5-
20%20Ltr%20to%20DeVos%20re%20Equitable%20Services.pdf.
24 18
Id.
25 19
Nicole Gaudiano, Alexander, DeVos split on stimulus support for private school kids,
Politico (May 22, 2020), available at https://www.politico.com/newsletters/morning-
26 education/2020/05/22/alexander-devos-split-on-stimulus-support-for-private-school-kids-787837.
20
27 Letter from national education organizations to congressional leadership (June 4, 2020),
available at https://ccsso.org/sites/default/files/2020-
28 06/Equitable%20Services%20Funding%20Letter%20-%20FINAL.pdf.
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1 A. The Rule Conflicts with the Plain Language of the CARES Act.
2 93. Like the Department’s Guidance Document, the Rule effectively rewrites both (1) the
3 proportional share calculation that Congress established for LEAs to determine the amount of
4 funds to be used for equitable services for private-school students, and (2) the eligibility criteria
5 that Congress mandated to determine which private-school students are entitled to equitable
6 services under the CARES Act.
7 94. Neither the proportional share nor eligibility mandates in the Rule comport with the
8 plain text of the CARES Act.
9 95. The Rule will divert millions of dollars to private schools and away from public
10 schools in direct contradiction of Congress’s intent.
11 96. For the proportional share calculation, the Rule provides two options to LEAs:
12 Option #1 (Title I-Only Schools Option):
13 An LEA using all its funds under a CARES Act program to serve only students and
teachers in public schools participating under Title I, Part A of the ESEA may
14 calculate the proportional share in accordance with paragraph (c)(1)(ii) of this section
or by using—
15
(A) The proportional share of Title I, Part A funds it calculated under section
16 1117(a)(4)(A) of the ESEA for the 2019-2020 school year; or
17 (B) The number of children, ages 5 through 17, who attend each non-public school in
the LEA that will participate under a CARES Act program and are from low-income
18 families compared to the total number of children, ages 5 through 17, who are from
low-income families in both Title I schools and participating non-public elementary
19 and secondary schools in the LEA.
20 34 C.F.R. § 76.665(c)(1)(i).
21 97. Functionally, this option is most similar to the ESEA, Section 1117 proportional share
22 calculation. See 20 U.S.C. § 6320(a)(4)(A); see also id. § 6320(c)(1). The two sub-options allow
23 the LEA to use the proportional share figures used for the 2019-2020 Title I-A distribution (34
24 C.F.R. § 76.665(c)(1)(i)(A)) or updated figures based on the current proportion of low-income
25 students who attend private schools in the LEA (34 C.F.R. § 76.665(c)(1)(i)(B)). By adopting the
26 ESEA, Section 1117 proportional share calculation, Option #1 similarly adopts the proportional
27 share calculation required by the CARES Act, as the funds would then be apportioned “in the
28
24
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1 same manner” as Section 1117. See CARES Act § 18005(a). However, this option includes two
2 unsupported “poison pill” limitations on LEAs who choose this option, as discussed below.
3 Option #2 (Private School Enrollment Option):
4 Any other LEA must calculate the proportional share based on enrollment in
participating non-public elementary and secondary schools in the LEA compared to
5 the total enrollment in both public and participating non-public elementary and
secondary schools in the LEA.
6
34 C.F.R. § 76.665(c)(1)(ii).
7
8 98. This option incorporates the Department’s erroneous proportional share calculation
9 set forth in the Guidance Document, requiring LEAs to consider all private-school students when
10 they apportion funds, similar to the calculation used to determine funds for equitable services
11 under Section 8501 of the ESEA, which Congress did not adopt for CARES Act funds. See 34
12 C.F.R. § 76.665(c)(1)(ii). This option has no basis in the CARES Act and would allow the
13 Department to divert hundreds of millions of dollars of CARES Act funds intended for public
14 schools to private schools.
15 99. As mentioned above, the Department included two poison pill requirements for using
16 Option #1 (Title I-Only Schools Option) to calculate the proportional share, with the obvious
17 effect of pushing LEAs to use Option #2.
18 100. The poison pill restrictions would force the LEAs using Option #1 to calculate the
19 proportional share to (1) use the CARES Act funds reserved for public schools for Title I schools
20 only, and (2) use the CARES Act only for limited, supplemental costs to avoid a Title I
21 supplanting violation. 34 C.F.R. § 76.665(c)(1), (c)(3); 20 U.S.C. § 6321(b)(1) (Section 1118 of
22 ESEA). This would effectively prohibit many LEAs from using CARES Act funds, for example,
23 to retain existing staff in Title I schools while using state and local dollars for the same purpose in
24 non-Title I schools. This requires LEAs to treat CARES Act funds not as stimulus monies but as
25 additional funds, forcing them to choose between a less beneficial methodology or a requirement
26 that limits their ability to spend CARES Act dollars to most effectively meet their needs.
27 101. Neither of these restrictions is found anywhere in the CARES Act. Rather, they are
28 both contrivances of the Department, seemingly intended to force LEAs to use Option #2 for
25
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1 apportioning the CARES Act funds. The restrictions effectively punish LEAs that attempt to
2 apportion the CARES Act funds as Congress intended.
3 102. The Department has acknowledged “Congress . . . intended that grantees have
4 substantial flexibility in the use of these [CARES Act] dollars.”21 Yet, the Department arbitrarily
5 imposes these restrictions on LEAs, significantly limiting their flexibility to use the funds.
6 103. These poison pill requirements are contradicted by the plain language of the CARES
7 Act, which specifies how the public schools’ share of the funds should be used.
8 104. The CARES Act grants LEAs that receive CARES Act funds flexibility to use the
9 funds for all schools in the district, not only Title I schools. See CARES Act §§ 18002(c)(1), (3),
10 18003(d)(1)-(12).
11 105. For the ESSER funds, the CARES Act specifies the twelve “[u]ses of [f]unds” for the
12 LEAs, including such broad uses as “[p]roviding principals and other school leaders with the
13 resources necessary to address the needs of their individual schools” and “[o]ther activities that
14 are necessary to maintain the operation of and continuity of services in [LEAs] and continuing to
15 employ existing staff of the [LEA].” CARES Act § 18003(d)(3), (12); see also id. § 18003(d)(1)-
16 (12). Likewise, LEAs can broadly use the GEER funds granted to LEAs at the Governor’s
17 discretion “to continue to provide educational services to their students and support on-going
18 functionality of the [LEA].” Id. § 18002(c)(1); see also id. § 18002(c)(3). These broad uses of
19 the ESSER and GEER funds as specified by Congress explicitly allow the LEAs and public
20 schools to use the funds to “supplant” state and local funding that may have been lost due to the
21 pandemic. The Rule impermissibly exceeds the scope of the CARES Act by requiring LEAs to
22 choose between two options that are contrary to the CARES Act’s requirements and prohibiting
23 LEAs from using funds consistent with those purposes if they use Option #1.
24
25
21
26 Letter from Mitchell M. Zais, Ph.D., Deputy Sec’y, U.S. Dep’t of Educ. to Gene
Dodaro, Comptroller Gen., U.S. Gov’t Accountability Off. (June 12, 2020), at p. 3 (available as
27 pp. 375-389 of the U.S. Gov’t Accountability Off., COVID-19 Opportunities to Improve Federal
Response and Recovery Efforts, GAO-20-625 (June 2020), available at
28 https://www.gao.gov/products/GAO-20-659T).
26
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1 106. Whether calculated under Option #1 (Title I-only schools Option) or Option #2
2 (Private school enrollment Option), CARES Act funds will be diverted from their intended
3 recipients.
4 107. Under Option #1, due to the poison pill restrictions, public-school students at non-
5 Title I schools (many of whom are low-income or otherwise at-risk) will receive no funding
6 whatsoever. The ESSER funds and part of the GEER funds were specifically designed to assist
7 all public schools in LEAs that receive CARES Act funds—not just the Title I schools within
8 these LEAs. And, even for the public-school students at Title I schools, the funds could only be
9 used for supplemental costs or else risk a Title I supplanting violation. Thus, the LEA would be
10 prohibited from using the CARES Act funds for general educational expenses in Title I schools,
11 such as teacher salaries, books, or general sanitation, among other uses, unless these services
12 were supplemental to those provided by state and local funds. This erroneous restriction is
13 directly contradicted by many of the listed “Uses of Funds” for moneys from the ESSER Fund in
14 the CARES Act. See CARES Act § 18003(d)(2)-(11). In addition, at-risk private-school
15 students, who are eligible for equitable services under Section 1117, will receive fewer funds per
16 student, and the funds reserved for private-school students will be used to provide services for all
17 private-school students (both at-risk and not at-risk), diluting funding that Congress intended for
18 vulnerable students.
19 108. Under Option #2, private-school students will receive a significantly greater
20 proportion of the funds than they are entitled to under the CARES Act, as all private-school
21 students will be considered when apportioning the funds. In turn, public schools will lose funding
22 diverted to the private schools. In addition, the money set aside for private-school students will
23 be used to provide services to all private-school students, reducing the amount of money per
24 student for the at-risk private-school students who are eligible for services under Section 1117.
25 109. Under either proportional share option, the Rule—like the Guidance Document—
26 requires LEAs to provide equitable services to all private-school students. 34 C.F.R. §
27 76.665(d)(2). This requirement does not comport with the plain text of the CARES Act, which
28 adopts the Section 1117 eligibility requirements, limiting equitable services to at-risk private-
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1 school students. See CARES Act § 18005(a); 20 U.S.C. § 6320(a) (incorporating the definition of
2 “eligible children” from 20 U.S.C. § 6315(c)).
3 B. The Department Lacks Authority to Issue the Rule and Failed to Follow
the Procedural Requirements of the APA.
4
5 110. The Rule cites 20 U.S.C. § 1221e-3 and 20 U.S.C. § 3474 as authority for rulemaking
6 related to the CARES Act. Neither of these statutes authorizes the Department to issue the Rule.
7 111. Congress gave no authority to the Department to issue rules interpreting the CARES
8 Act either generally, with regard to the GEER and ESSER Funds, or in particular to the
9 distribution of appropriated funds for equitable services for private-school students.
10 112. Nor did Congress authorize the Department to issue rules related to the provision of
11 equitable services for private-school students without compliance with the notice and comment
12 procedures of the APA.
13 113. The Department issued the Rule as an interim final rule without demonstrating good
14 cause that the notice and public procedures were impracticable, unnecessary, or contrary to the
15 public interest.
16 114. Because the Department cannot satisfy the requirements for issuing the Rule as an
17 interim final rule, the Rule does not comply with the Administrative Procedure Act’s procedural
18 requirements.
19 V. THE RULE WILL CAUSE IMMEDIATE AND IRREPARABLE HARM TO PLAINTIFFS,
SCHOOLS, AND STUDENTS.
20
21 115. The Rule and Guidance Document will cause immediate, irreparable harm to the
22 interests of the Plaintiff States, Plaintiff LEAs, and the vulnerable students whom Congress meant
23 to assist through the CARES Act.
24 A. Immediate and Irreparable Harm to the Plaintiff States
25 116. Plaintiff States, themselves and through their publicly administered educational
26 institutions, are directly regulated by the Rule and will suffer direct harm because of the Rule.
27 117. Each of the Plaintiff States is constitutionally required to administer a system of K-12
28 public education funded primarily by state moneys:
28
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1 a. Michigan: The Michigan Constitution charges the Michigan Legislature with
2 “maintain[ing] and support[ing] a system of free public elementary and
3 secondary schools as defined by law.” Mich. Const. art. VIII, § 2. The State
4 Board of Education is vested with “[l]eadership and general supervision over
5 all public education . . . .” Id. § 3. The State Board of Education further
6 “serve[s] as the general planning and coordinating body for all public
7 education . . . and shall advise the legislature as to the financial requirements
8 in connection therewith.” Id. Separate from any federal funding, Michigan
9 provides more than $13 billion each year to its approximately 831 LEAs and
10 56 intermediate school districts. The 3,400 school buildings in these districts
11 educate almost 1.5 million students each year. While the school districts
12 exercise primary responsibility over budgetary and other decisions within
13 their respective districts, the Michigan Department of Education (MDE)
14 implements federal and state legislative mandates in education and carries out
15 the policies of the State Board of Education. See Mich. Comp. Laws §
16 388.1009.
17 b. California: The State of California is the legal and political entity with plenary
18 responsibility for educating all California public-school students. California
19 has the constitutional responsibility to establish and maintain the system of
20 common schools and a free education. Cal. Const. art. IX, § 5. California
21 funds and oversees the operation of the largest common system of public
22 schools in the nation, which serves nearly 6.8 million children in more than
23 10,500 schools. In 2018–2019, California provided about $56.1 billion in
24 General Funds to its 1,037 school districts and over 1,200 charter schools.
25 Under the California Constitution, “[t]he State itself has broad responsibility
26 to ensure basic educational equality.” Butt v. State of California, 4 Cal. 4th
27 668, 681 (1992). Emergency conditions causing inequitable conditions may
28 create a duty for the State to intervene and provide supplementary support.
29
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1 See id. at 688. The California State Board of Education makes education
2 policy determinations, and adopts rules and regulations for the government of
3 elementary and secondary schools. Cal. Educ. Code §§ 33000, 33030-33031.
4 The California State Board of Education is responsible for applying for
5 federal funds made available to state education agencies under federal law, is
6 responsible for directing the allocation and apportionment of those federal
7 funds to public schools, and is responsible for adopting implementing rules
8 and regulations governing those federal funds. Cal. Educ. Code §§ 12000-
9 12001. The California Superintendent of Public Instruction oversees the
10 schools within the state and is the executive officer of the California State
11 Board of Education and the California Department of Education. Cal. Educ.
12 Code §§ 33112, 33301(b), 33302-33303. The California Department of
13 Education is a state administrative agency responsible for administering and
14 enforcing laws related to education throughout California. Cal. Educ. Code
15 §§ 33300, 33301, 33306, 33308.
16 c. District of Columbia: The Office of the State Superintendent of Education
17 (OSSE) is the state education agency for the District of Columbia charged
18 with raising the quality of education for all DC residents. OSSE serves as the
19 District’s liaison to the Department and works closely with the District’s
20 traditional and public charter schools to achieve its key functions. D.C. Code
21 § 38-2601. District of Columbia public schools received more than $902
22 million in state funding last year while charter schools in the District received
23 more than $904 million. 95,820 students attend either a public or charter
24 school in the District.
25 d. Hawaii: The Hawaii Constitution provides for the “establishment, support
26 and control of a statewide system of public schools.” Haw. Const. art. X, § 1.
27 The Hawaii Department of Education (HIDOE) is the state education agency
28 for Hawaii charged with administering programs of education and public
30
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1 instruction throughout the State. As a single state system of education,
2 HIDOE also assumes the responsibilities of a local education agency.
3 Separate from any federal funding, HIDOE received approximately $1.7
4 billion, or 82 percent of its total budget, in State General Funds for the 2019-
5 2020 fiscal year to be distributed amongst 256 public schools and 37 charter
6 schools. Approximately 180,000 students in Hawaii attend either a public or
7 charter school.
8 e. Maine: Maine’s state policy on public education is that “[i]t is the intent of the
9 Legislature that every person within the age limitations prescribed by state
10 statute shall be provided an opportunity to receive the benefits of a free public
11 education.” Me. Rev. Stat. tit, 20-A, § 2(1). The Maine Department of
12 Education is charged with “[s]upervis[ing], guid[ing] and plan[ning] for a
13 coordinated system of public education for all citizens of the State . . . .” Me.
14 Rev. Stat., tit. 20-A, § 201(1). The Commissioner of Education is responsible
15 for “[p]roviding educational public leadership for the State” and “[e]nforcing
16 applicable regulatory requirements for school administrative units.” Me. Rev.
17 Stat., tit. 20-A, § 251-A(1), (3). The Commissioner determines the amount of
18 state funding for Maine’s school administrative units through the Essential
19 Programs and Services Funding Act, Me. Rev. Stat., tit. 20-A, § 15670 et seq.
20 The Commissioner is responsible for the distribution of funds and the
21 oversight of the federal grants that the Department receives. Separate from
22 any federal funding, Maine provides more than $1.2 billion each year to its
23 265 school administrative units (including public charter schools) and two
24 state magnet schools. The 599 school buildings in these school administrative
25 units educate approximately 175,600 students each year.
26 f. Maryland: The Maryland Constitution requires the Maryland Legislature to
27 “establish throughout the State a thorough and efficient System of Free Public
28 Schools” and “provide by taxation, or otherwise, for their maintenance.” Md.
31
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1 Const. art. VIII, § 1. By statute, the State Board of Education is vested with
2 the general care and supervision of public education. Md. Code Ann.,
3 Education §§ 2-201 and 2-205. The State Board determines the educational
4 policies of the State and enacts regulations for the administration of the
5 public-school system. The totality of statutory provisions gives the State
6 Board the last word on any matter concerning educational policy or the
7 administration of the system of public education. Separate from any federal
8 funding, Maryland provided its 24 LEAs with more than $7 billion in
9 operating and capital funds for fiscal year 2020-21. The 1,582 school
10 buildings in these districts educate 900,000 students each year. While the
11 school districts exercise primary responsibility over budgetary and other
12 decisions within their respective districts, the Maryland State Department of
13 Education (MSDE) implements federal and state legislative mandates in
14 education and carries out the policies of the State Board of Education. See
15 Md. Code Ann., Education, Title 2.
16 g. New Mexico: The New Mexico Constitution promises to establish and
17 maintain a uniform, free public-school system “sufficient for the education of,
18 and open to, all the children of school age.” N.M. Const. Art. 12, § 1. In
19 2020, legislators appropriated $3.468 billion in state funds for public
20 education from prekindergarten through secondary schools, or 45.5 percent of
21 total recurring appropriations. In 2019, the definition of “school-age” was
22 revised to include students through age 22. The Fiscal Year 2021 budget
23 increased recurring appropriations by $216 million, or 6.6 percent, with
24 significant additional funding to increase educator compensation, provide
25 additional services to at-risk students, and provide professional development
26 and mentorship support for early career teachers.
27 h. Pennsylvania: The Pennsylvania Constitution charges the Pennsylvania
28 General Assembly with “provid[ing] for the maintenance and support of a
32
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1 thorough and efficient system of public education to serve the needs of the
2 Commonwealth.” Pa. Const. Art. III § 14. The Commonwealth provides
3 more than $12 billion each year to its 500 public school districts, which
4 educate more than 1.72 million students each year in 2,865 schools.
5 i. Wisconsin: The Wisconsin Constitution requires the Wisconsin Legislature to
6 establish district schools which are to be “as nearly uniform as practicable”
7 and “free and without charge for tuition to all children.” Wis. Const. art. X, §
8 3. The supervision of public instruction is vested in the Superintendent of
9 Public Instruction (State Superintendent). The State Superintendent is
10 charged with the general supervision of public instruction and leads the
11 Department of Public Instruction (DPI) in implementing policies and
12 promulgating administrative rules. Wis. Stat. § 15.37; see also, e.g., Wis.
13 Stat. § 115.28(1), (3), (7). Her responsibilities also include accepting and
14 administering federal funds. Wis. Stat. § 115.28(9) and (19). Wisconsin
15 school district funding comes from state and federal aids, property taxes, and
16 local revenue. Wisconsin provides state aids to 443 LEAs, with a combined
17 total student enrollment of 854,959. In the 2019-2020 school year, DPI
18 administered approximately $6.1 billion in state support for K-12 public
19 schools.
20 118. The CARES Act appropriates funds for the Plaintiffs to support public K-12 schools
21 through the COVID-19 pandemic. Plaintiffs are facing severe budgetary cuts due to the
22 economic impact of the pandemic—cuts that the ESSER and GEER Fund moneys were designed
23 to mitigate. Under the Department’s Rule and the Guidance Document, public schools in the
24 Plaintiff States will lose a significant portion of the ESSER and GEER moneys that will be
25 diverted to private schools. This result is inconsistent with the clear language of the CARES Act,
26 and inequitable because public schools do not qualify for other CARES Act funding available to
27 private schools. Accordingly, LEAs will look to States to bridge the gaps in their respective
28 public-school budgets that the ESSER and GEER moneys were intended to fill.
33
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1 119. If LEAs in the Plaintiff States follow the Rule’s Option #1 (Title I-schools only
2 Option) when apportioning CARES Act funds, non-Title I schools across the Plaintiff States
3 stand to lose significant emergency funding to support their schools, and LEAs stand to lose the
4 ability to use the funds to maintain operations that are funded on an LEA-wide basis. In addition,
5 while Title I schools in the Plaintiff States will receive some CARES Act funds under Option #1,
6 the Rule improperly limits how they can use the funds by effectively prohibiting them from using
7 such funds for existing costs. Thus, for both Title I and non-Title I schools in the LEAs that
8 receive CARES Act funds, the effect of the Rule is to stymie the States and LEAs from using the
9 funds for their intended purpose—to “support and prevent, prepare for, and respond to
10 coronavirus.” CARES Act § 18001. As a result, the Plaintiffs will be required to allocate
11 moneys to help these schools weather the budgetary storm created by the pandemic.
12 120. If LEAs in the Plaintiff States follow the Rule’s Option #2 (Private school enrollment
13 Option) when apportioning CARES Act funds, the Plaintiff States’ LEAs and public schools will
14 lose out on significant amounts of ESSER and GEER moneys, which will be diverted to private
15 schools for students who would not otherwise qualify for Title I-A equitable services.
16 a. Michigan: If Michigan’s LEAs are forced to follow Option #2 in the Rule for
17 apportioning CARES Act funds, an estimated $21,604,649 in ESSER moneys
18 would be diverted from public schools in order to provide equitable services
19 to all private-school students. If Michigan LEAs distribute the ESSER
20 moneys in the same manner that Title I-A funds are usually distributed for
21 equitable services based on low-income private-school students, as the plain
22 language of the CARES Act requires, then only an estimated $5,107,921 will
23 be distributed for equitable services to eligible private-school students. Thus,
24 if the Department’s Rule stands and LEAs used Option #2 to apportion their
25 CARES Act funds, an estimated total of $16,496,728 in ESSER moneys will
26 be diverted from low-income public schools to private-school students who
27 are not qualified for Title I-A funds—7% of the total ESSER moneys that
28 Michigan received. This would amount to $2,251,131 less for Detroit Public
34
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1 School Community District students; $2,643,214 less for Grand Rapids Public
2 Schools students, and $1,474,676 less for Flint Community Schools students.
3 b. California: If California’s LEAs are forced to follow Option #2 in the Rule for
4 apportioning CARES Act funds, an estimated $60,249,538 in ESSER and
5 GEER moneys would be diverted from public schools in order to provide
6 equitable services to all private-school students. If California’s LEAs
7 distribute the ESSER and GEER moneys in the same manner that Title I-A
8 funds are usually distributed for equitable services based on low-income
9 private-school students, as the plain language of the CARES Act requires,
10 then only an estimated $5,449,992 of the ESSER and GEER moneys will be
11 distributed for equitable services to eligible private-school students. Thus, if
12 the Department’s Rule stands and LEAs used Option #2 to apportion their
13 CARES Act funds, an estimated $54,799,545 in ESSER and GEER moneys
14 will be diverted from low-income public schools to private-school students
15 who are not qualified for Title I-A funds.
16 c. District of Columbia: If the District of Columbia Public Schools (DCPS) is
17 forced to follow Option #2 in the Rule for apportioning CARES Act funds,
18 approximately $5,002,441 in ESSER and GEER moneys would be diverted
19 from public school funds in order to provide equitable services to all private-
20 school students. If DCPS distributes the ESSER and GEER moneys in the
21 same manner that Title I-A funds are usually distributed for equitable services
22 based on low-income private-school students, as the plain language of the
23 CARES Act requires, then only $1,435,483 will be distributed for equitable
24 services to eligible private-school students. Thus, if the Department’s Rule
25 stands and LEAs used Option #2 to proportion their CARES Act funds, a total
26 of $3,566,958 in ESSER and GEER moneys will be diverted from low-
27 income public schools to private-school students that are not qualified for
28 Title I-A funds—12% of the total ESSER/GEER moneys that DC received.
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1 d. Hawaii: If HIDOE is forced to follow Option #2 in the Rule for apportioning
2 CARES Act funds, approximately $2,003,428 in ESSER moneys would be
3 diverted from public school funds in order to provide equitable services to all
4 private-school students. If HIDOE distributes the ESSER moneys in the same
5 manner that Title I-A funds are usually distributed for equitable services based
6 on low-income private school students, as the plain language of the CARES
7 Act requires, then only $1,555,931 will be distributed for equitable services to
8 eligible private-school students. Thus, if the Department’s Rule stands, a total
9 of $447,497 in ESSER money will potentially be diverted from low-income
10 public schools to private-school students that are not qualified for Title I-A
11 funds—1.03% of the total ESSER money that Hawaii received.
12 e. Maine: If Maine’s LEAs are forced to follow the Department’s Rule and
13 Guidance, the Maine Department of Education (MDOE) estimates that $2.1
14 million in ESSER money would be apportioned to provide equitable services
15 to private-school students. If Maine’s LEAs distribute the ESSER money in
16 the same manner that Title I-A funds are usually distributed for equitable
17 services based on low-income private-school students, as the plain language
18 of the CARES Act requires, then only $248,000 will be distributed for
19 equitable services to eligible private-school students. Thus, if the
20 Department’s Rule stands, a total of $1,852,000 in ESSER money will
21 potentially be diverted from low-income public schools to private-school
22 students that are not qualified for Title I-A funds—4.25% of the total ESSER
23 money that Maine received.
24 f. Maryland: If Maryland’s LEAs follow Option #2 in the Rule for apportioning
25 CARES Act funds, they would reserve an estimated $18,143,913 in ESSER
26 funds to provide equitable services to private school students. If Maryland
27 LEAs distribute the ESSER moneys in the same manner that Title I-A funds
28 are usually distributed for equitable services based on low-income private-
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1 school students, as the plain language of the CARES Act requires, then only
2 an estimated $2,508,760 will be distributed for equitable services to eligible
3 private-school students. Thus, if the Department’s Rule stands and LEAs use
4 Option #2 to apportion their CARES Act funds, approximately $15,000,000 in
5 ESSER moneys will be diverted from low-income public schools to private-
6 school students who are not qualified for Title I-A funds.
7 g. New Mexico: If New Mexico’s LEAs are forced to follow Option #2 in the
8 Rule for apportioning CARES Act funds, millions in ESSER and GEER
9 moneys would be diverted from public school funds in order to provide
10 equitable services to all private-school students. If New Mexico’s LEAs
11 distribute the ESSER and GEER moneys in the same manner that Title I-A
12 funds are usually distributed for equitable services based on low-income
13 private-school students, as the plain language of the CARES Act requires,
14 then a considerably smaller portion of the ESSER and GEER moneys will be
15 distributed for equitable services to eligible private-school students. Thus, if
16 the Department’s Rule stands and LEAs used Option #2 to apportion their
17 CARES Act funds, millions in ESSER and GEER moneys will be diverted
18 from low-income public schools to private-school students that are not
19 qualified for Title I-A funds.
20 h. Pennsylvania: If Pennsylvania’s LEAs are forced to follow Option #2 in the
21 Rule for apportioning CARES Act funds, millions in ESSER and GEER
22 funding would be diverted from public schools in order to provide equitable
23 services to all private-school students. If Pennsylvania’s LEAs distribute the
24 ESSER and GEER funds in the same manner that Title I-A funds are usually
25 distributed for equitable services based on low-income private-school
26 students, as the plain language of the CARES Act requires, then a
27 considerably smaller portion of the ESSER and GEER moneys will be
28 distributed for equitable services to eligible private-school students. Thus, if
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1 the Department’s Rule stands and LEAs used Option #2 to apportion their
2 CARES Act funds, millions in ESSER and GEER moneys will be diverted
3 from low-income public schools to private-school students who are not
4 qualified for Title I-A funds.
5 i. Wisconsin: If Wisconsin’s LEAs are forced to follow Option #2 in the Rule
6 for apportioning CARES Act funds, $28,429,917 in ESSER and GEER
7 moneys would be diverted from public school funds in order to provide
8 equitable services to all private-school students. If Wisconsin LEAs distribute
9 the ESSER and GEER moneys in the same manner that Title I-A funds are
10 usually distributed for equitable services based on low-income private-school
11 students, as the plain language of the CARES Act requires, then only
12 $24,245,401 will be distributed for equitable services to eligible private-
13 school students. Thus, if the Department’s Rule stands and LEAs used Option
14 #2 to apportion their CARES Act funds, a total of $4,184,516 in ESSER and
15 GEER moneys will be diverted from low-income public schools to private-
16 school students that are not qualified for Title I-A funds—approximately 2%
17 of the total ESSER/GEER moneys that Wisconsin will distribute to LEAs.
18 121. In total, if every LEA receiving CARES Act funds in the Plaintiff States uses Option
19 #2 to apportion CARES Act funds, the Plaintiff States will be required to divert tens of millions
20 of dollars in CARES Act funding to provide services to private-school students. The States’
21 public schools were expecting to receive these ESSER and/or GEER moneys.
22 122. Many LEAs may also have to rework their methodologies for allocating State and
23 local funds to public schools to accommodate the new funds and ensure that CARES Act dollars
24 do not result in a violation of the Title I-A supplement, not supplant requirement. This is a result
25 that was not contemplated by Congress and an administrative cost not taken into account in the
26 Rule.
27 123. On top of the additional funding that each Plaintiff State will be required to expend in
28 lieu of the CARES Act funds diverted to private school services, the Department’s Guidance
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1 Document and Rule impose significant administrative burdens on SEAs, which have fielded and
2 will continue to field numerous questions from LEAs about how ESSER and/or GEER Fund
3 moneys should be apportioned in light of the Department’s Rule, which is particularly confusing
4 given its clear inconsistency with the CARES Act.
5 124. The confusion caused by the Department has required the SEAs to divert resources to
6 drafting and issuing memoranda, letters, and other technical assistance to assist LEAs in
7 apportioning the moneys.
8 125. While facing numerous remote learning-related challenges in the throes of the
9 pandemic, the SEAs are now forced to redirect resources to assist LEAs in addressing the
10 conflicting requirements generated by the Department’s Rule that misinterprets the Act.
11 126. In addition, the Department’s Rule imposes strict restrictions on LEAs using Option
12 #1 to apportion the funds, which will increase costs incurred by the SEAs and LEAs to administer
13 equitable services and provide necessary oversight and control over funding, as required under
14 CARES Act Section 18005(b).
15 127. The additional time and work caused by the Department’s confusing and erroneous
16 interpretation of Section 18005 of the CARES Act will create a substantial burden on the SEAs.
17 Since the COVID-19 pandemic enveloped the Nation, SEAs, LEAs, and schools in the Plaintiff
18 States have been working tirelessly to transition to remote learning; secure computers and other
19 electronic devices to facilitate students’ continued learning; create health and safety plans for
20 returning to school; and plan for the 2020-2021 school year. The time, money, and effort SEAs
21 have diverted to assisting LEAs with how to apportion ESSER/GEER moneys for equitable
22 services for private-school students are directly caused by the Department’s Guidance Document
23 and the Rule. The Department’s estimate of administrative burden does not adequately capture
24 the amount of administrative time that will be needed to implement this new Rule.
25 128. The Department’s inconsistent interpretations in the Guidance Document and the
26 Rule have also caused a delay in distributing funds to students and teachers—the intended
27 beneficiaries of these funds—which is contrary to the purpose of the CARES Act funding.
28
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1 129. Moreover, the Plaintiff States’ SEAs are required to certify in their ESSER Fund
2 applications that the SEAs and the LEAs will comply with the equitable service provision of the
3 CARES Act (§ 18005) and “any other applicable law or regulation.”22
4 130. Because the Department’s Rule contradicts the CARES Act’s requirements, SEAs
5 (and LEAs) cannot certify that they will comply both with the CARES Act and the Rule.
6 131. The Department’s Rule places the SEAs in a position where they would be in breach
7 of the certification in the Certification and Agreement, subjecting the SEAs to “liability under the
8 False Claims Act . . . [and the] OMB Guidelines to Agencies on Governmentwide Debarment and
9 Suspension (Non-procurement).”23 Accordingly, SEAs may face potential legal consequences as
10 a direct result of the Department’s Rule.
11 132. The Plaintiff States incurred, and will continue to incur, these financial, legal, and
12 other harms vis-a-vis their SEAs, and the other state-supported K-12 educational institutions in
13 the Plaintiff States.
14 B. Immediate and Irreparable Harm to the Plaintiff LEAs
15 133. The Rule’s “Options,” found nowhere in the CARES Act, either significantly
16 decrease the amount of CARES Act emergency relief funds allocated to the Plaintiff LEAs or
17 limit the use of those funds through restrictions. Plaintiff LEAs will suffer direct harm because of
18 the Rule.
19 134. Each of the Plaintiff LEAs administers K-12 public education in their jurisdiction and
20 was expecting to receive and use the CARES Act funds as set forth in the Act:
21 a. New York City: The NYCDOE is the LEA of the City School District of the
22 City of New York, except that for Title I-A purposes, each borough of the
23 City is considered an LEA and receives a distinct allocation of Title I funding
24 administered by the New York State Education Department. The NYCDOE is
25 the largest school district in the nation, with approximately 1,600 public
26 schools that serve approximately 1.1 million students, of whom approximately
27 22
Certification and Agreement for ESSER Fund, supra note 6.
23
28 Id.
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1 820,093 (72.8%) are economically disadvantaged, 927,110 (82.3%) are
2 minorities, 227,553 (20.2%) have a disability, and 148,696 (13.2%) are
3 English-Language Learners. For many of these at-risk students, the City’s
4 public schools are essential sources not only of education, but of food,
5 transportation, medical care, and emotional support. Economically
6 disadvantaged students are at greater risk to the ravages of the COVID-19
7 pandemic. These children are the intended recipients of the CARES Act
8 emergency funds.
9 b. Chicago: The CBOE is the LEA for the City of Chicago school district. It is
10 the third-largest school district in the nation with over 600 public schools,
11 serving approximately 360,000 K-12 students in the 2019-2020 school year.
12 Of those students, about 76% qualify as economically disadvantaged, almost
13 19% are English Learners, and about 15% have Individualized Education
14 Plans (i.e., have learning-related disabilities). Over 46% of the district’s
15 student body is Latino, 36% is African American, 11% is White, 4% is Asian,
16 and 1.3% is mixed race. The foregoing at-risk groups served by CBOE are
17 the most vulnerable to the impact of the COVID-19 pandemic and are clearly
18 the intended recipients of the CARES Act emergency funds. For many of
19 those students, the City’s public schools are essential sources of education,
20 food, transportation, medical care, and other vital services.
21 c. Cleveland: CMSD is the LEA for the City of Cleveland, including for
22 purposes of Title I under the ESEA. CMSD has 103 public schools, serving
23 approximately 37,700 students. All of CMSD’s students are considered
24 economically disadvantaged. Around 8.3% of those children are homeless;
25 84.6% are minorities; 23.5% have a disability; and 9.7% are English-
26 Language Learners. These at-risk groups are the most vulnerable to the
27 impact of the COVID-19 pandemic and are clearly the intended recipients of
28 the CARES Act emergency funds. For many of those students, the CMSD’s
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1 schools are essential sources of education, food, transportation, medical care,
2 and other vital services.
3 d. San Francisco: SFUSD is a LEA and is one of the largest school districts in
4 California, operating pursuant to the laws of the state of California. SFUSD’s
5 offices are located on Franklin Street in San Francisco, California. SFUSD
6 serves approximately 52,468 students, of whom 28,556 are socioeconomically
7 disadvantaged, 15,028 are English Learners, 2,064 are homeless, 6,275 are
8 students with disabilities, and 254 are foster youth.24 These at-risk groups are
9 the most vulnerable to the impact of the COVID-19 pandemic and are the
10 intended recipients of the CARES Act emergency funds. For many of those
11 students, the SFUSD’s public schools are essential sources of education, food,
12 transportation, medical care, and other vital services. SFUSD receives a
13 distinct allocation of Title I funding, which the California Department of
14 Education (CDE) administers. SFUSD oversees approximately 133 schools of
15 which about 53 qualify as Title I schools.
16 135. Pursuant to Title I, the Plaintiff LEAs designate schools eligible for Title I funds
17 based on poverty percentages, as follows:
18 a. New York City: The NYCDOE designates schools eligible for Title I funding
19 based on the poverty percentages of each borough. In the Bronx, Brooklyn,
20 Manhattan, or Queens, Title I-school status is reached when no less than 60%
21 of a school’s students are from low-income families; the percentage is 52.13%
22 in Staten Island. Although the statutory threshold for Title I-school status is
23 set far lower, at a floor of 35%, see 20 U.S.C. 6313(b)(1), the NYCDOE
24 exercises the discretion permitted by Title I to set a higher poverty threshold,
25 ensuring that Title I funding adequately provides programs and services to
26 schools with the greatest needs. Even with that far higher threshold, in the
27 24
California School Dashboard, San Francisco Unified School District, available at
28 https://www.caschooldashboard.org/reports/38684780000000/2019.
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1 2019-2020 school year, the NYC school district was comprised of 1,314 Title
2 I schools and 269 non-Title I schools.
3 b. Chicago: CBOE uses the same methodology for calculating Title-I eligibility
4 for the entire district. Every school with a poverty index of 40 or above
5 receives Title I funding, with a few other schools qualifying for Title I status
6 based on waivers. Overall, about 89 percent of CPS schools qualify for Title I
7 discretionary funding.
8 c. Cleveland: In the 2019-2020 school year, 100 percent of CMSD’s schools
9 were Title I schools.
10 d. San Francisco: SFUSD designates schools eligible for Title I funding based
11 on poverty percentages using the grade-span ranking option. SFUSD’s
12 allocation understates actual eligibility, in that entitlements are calculated
13 based on county poverty rates, and students attending SFUSD are not
14 representative of the county’s poverty rate, which is three times less. To
15 maximize the impact of a proportionally smaller entitlement to other
16 similarly-sized counties, SFUSD chooses not to fund high schools (below the
17 obligatory 75 percentile threshold). High schools receive supplemental
18 funding based on poverty percentages from other funding sources. To be
19 eligible for Title I funding, schools in the elementary or middle school span
20 must be at or above the poverty calculation for that grade span. For the 2020-
21 2021 school year, SFUSD has about 53 Title I-eligible schools.
22 136. Plaintiff LEAs fund their schools through a variety of means and methods, as follows:
23 a. New York City: In the NYCDOE, the Fair Student Funding formula (“FSF”) is
24 the primary funding source for schools and consists of unrestricted state and
25 local funding that affords school leaders with the freedom to best determine
26 expenditures for their schools. FSF covers basic instructional needs and is
27 allocated based on the number and particular needs of students enrolled in
28 each school. After allocating a fixed amount for each student, the FSF
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1 funding formula ascribes weights to each student to allocate greater funding
2 for particular needs, such as grade level, academic intervention for at-risk
3 students, and special programs for English Language Learners and students
4 with disabilities. FSF provides funds for about two-thirds of each school’s
5 budget; the remaining approximately one-third is comprised of funding
6 restricted to specific purposes, including federal grants like Title I. The
7 NYCDOE also has a central budget that covers central administration costs
8 and support services that are provided on a city-wide basis for all schools in
9 the City, including, but not limited to, school facilities services, meals, school
10 safety, pupil transportation, and energy and leases. A significant portion of
11 the NYCDOE’s budget derives from New York State’s allocation of school
12 aid, known as Foundation Aid. Faced with deep economic losses from the
13 COVID-19 pandemic, New York State instituted a “pandemic adjustment” for
14 fiscal year 2021, reducing the NYCDOE’s Foundation Aid by $716,903,289,
15 and purporting to offset this budget cut dollar-for-dollar by backfilling it with
16 federal CARES Act funding, which itself is reduced by the Department’s
17 misinterpretation of the CARES Act.
18 b. Chicago: The CBOE annual budget for the 2020 school year is $6.9 billion.
19 The CBOE derives about $3.8 billion of its funding through local sources,
20 while the State of Illinois contributes almost $2.3 billion, and the federal
21 government provides about $767 million. CBOE estimates that it will receive
22 about $245 million in Title I funding for the 2020 school year. CBOE uses
23 Student Based Budgeting (SBB) to fund schools. SBB allocates funds to
24 individual schools based on the total student population. For fiscal year 2020,
25 the SBB rate is about $4,500 per pupil. Schools with low-income households
26 also rely upon other funding sources, such as Supplemental Aid, Equity
27 Grants, and federal funds provided according to Title I, Title II, Title III, Title
28 IV, and Title VII.
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1 c. Cleveland: CMSD receives funding from the State of Ohio and local property
2 taxes, as well as through federal programs targeting specific student
3 populations. State funding and local property taxes cover basic instructional
4 needs and are allocated based on the number of students enrolled at each
5 school and the needs of those students, weighted for various categories such
6 as grade level, academic intervention for at-risk students, and special
7 programs for English Language learners and students with disabilities. State
8 support accounts for 55% of CMSD’s revenues; local funding accounts for
9 approximately 27%; and federal funds are approximately 14%. The largest
10 category of the CMSD’s funding is Foundation Funding, which CMSD
11 receives from the State of Ohio. Faced with deep budgetary cuts because of
12 the economic impact of the COVID-19 pandemic, Ohio reduced CMSD’s
13 Foundation Funding by more than $5.6 million. CMSD has been notified to
14 prepare for similar cuts in Fiscal Year 2021 and also anticipates a drop in local
15 property tax collections.
16 d. San Francisco: In SFUSD the Weighted Student Formula (“WSF”) is the
17 primary funding source for schools and consists of state funding with limited
18 spending restrictions, excepting stipulations per the CDE. WSF covers basic
19 instructional needs and is allocated based on the number of students enrolled
20 at each school and the needs of those students, weighted for various
21 characteristics such as academic proficiency of incoming students, at-risk
22 factors such as Free-and-Reduced-Price Lunch (“FRL”) eligibility and
23 housing stability, English Learner status, and students with disabilities.
24 Though variable across school sites, WSF accounts for about 80% of each
25 school’s budget; approximately 20% are funding allocations with spending
26 restrictions, such as funds provided pursuant to Title I or local funds with
27 stipulated uses. Sites may be allocated staffing supports funded by the central
28 office, including academic and social emotional interventions for school
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1 turnaround and specific programmatic offerings. SFUSD also has a central
2 budget that covers central administration and services for all schools,
3 including school facilities, food, safety, pupil transportation, and energy and
4 leases. The largest category of SFUSD’s school aid is Local Control Funding
5 Formula (“LCFF”), which SFUSD receives from the state of California.
6 Faced with deep budgetary cuts because of the economic impact of the
7 COVID-19 pandemic, California reduced the SFUSD’s LCFF aid by
8 approximately $12,000,000. Additionally, SFUSD is losing local revenues
9 necessary to support operations while also incurring new costs associated with
10 providing services (i.e., digital learning (computers/WiFi), hand sanitizers)
11 related to COVID-19.
12 137. As described above, the CARES Act requires the Plaintiff LEAs receiving monies
13 from the GEER and/or the ESSER Funds to allocate a portion of those funds to provide
14 “equitable services” to students and teachers at nonpublic schools “in the same manner as
15 provided under Section 1117 of the ESEA . . . .” CARES Act § 18005(a). If Plaintiff LEAs were
16 to distribute these funds as mandated by the CARES Act, “in the same manner” as required by the
17 equitable services provision in Section 1117 of the ESEA (i.e., based on the number of low-
18 income private school students residing in a Title I school attendance area in the school district in
19 relation to the total number of low-income private and public school students residing in a Title I
20 school attendance area in the school district), then the proportional share to be provided for
21 equitable services to students in nonpublic schools would be based on the number of low-income
22 nonpublic school students residing in a Title I school attendance area.
23 138. By contrast, the allocation of funds contemplated by the Rule effectively penalizes
24 Plaintiff LEAs. If the funds are allocated according to the Rule’s Option #1 (Title I Only Schools
25 Option) formula, the Rule imposes two additional requirements—found nowhere in the CARES
26 Act—that restrict the use of CARES Act funds. The restrictions are in effect a “poison pill”
27 making Option #1 onerous, infeasible, and not a viable choice, and resulting in immediate and
28 irreparable harm to the Plaintiff LEAs.
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1 139. The Rule’s first “poison pill” for LEAs using the Option #1 calculation method
2 prohibits the Plaintiff LEAs from using CARES Act funds for any purpose other than funding for
3 a Title I school. Non-Title I schools deprived of CARES Act funds will not be able to provide
4 essential educational services to their students.25
5 a. New York City: NYCDOE’s 269 non-Title I schools will be deprived of
6 CARES Act funds. The estimated impact on non-Title I schools would be a
7 loss of approximately $100 million in desperately needed funds.
8 b. Chicago: The approximately 60 non-Title I schools within CBOE would be
9 deprived of any CARES Act funds.
10 c. San Francisco: SFUSD’s approximately 80 non-Title I schools will be
11 deprived of thousands in desperately needed funds.
12 140. The second “poison pill” for LEAs using Option #1 calculation method is that the
13 Rule demands the funds be used only to supplement, not supplant, funding in the Title I schools’
14 budgets, improperly importing Title I’s “supplement-not-supplant” provision into the CARES
15 Act—a restriction not found in the CARES Act. Thus, the Rule purports to prohibit the Plaintiff
16 LEAs from using CARES Act funds in place of state and local funds, permitting only that the
17 CARES Act funds be used to supplements those funds. This restriction contradicts the purpose of
18 the CARES Act, which is to provide funding to address issues caused by the pandemic, such as
19 maintaining continuity of services and continuing to employ existing staff, and to supplant city
20 and local funds that have been eliminated due to fiscal constraints.
21 141. Because the Rule precludes the Plaintiff LEAs from using CARES Act funds except
22 in Title I schools, the funds are restricted from use to pay for essential central services, common
23 to all public schools within the Plaintiff LEAs, such as transportation costs, facilities maintenance
24 and improvements, school safety, food services (including staff to serve meals), technology
25 platforms for remote learning, and custodial and cleaning supplies. In many of the Plaintiff
26 LEAs, these expenditures are made on a City/District-wide basis, and the additional
27
25
28 All public schools within the CMSD are Title I schools.
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1 administrative and financial burdens imposed by handling these expenditures on a per-school
2 basis in the context of the Plaintiff LEAs’ highly complex budget processes makes it overly
3 burdensome and/or impossible to fund central services in the face of a restriction of CARES Act
4 funds to Title I schools alone.
5 142. The USDOE’s obvious intent is to force LEAs to follow the Rule’s Option #2
6 (Private School Enrollment Option), knowing LEAs seek to use their share of CARES Act funds
7 to serve students and teachers in all of their public schools. But, if the Plaintiff LEAs are forced
8 to use Option #2, their public schools stand to lose significant funding, as follows:
9 a. New York City: If the NYCDOE were to use the Rule’s Option #2
10 methodology for calculating the proportional share of equitable services to
11 nonpublic schools, the effect of including all private-school students in the
12 calculation of the proportional share for equitable services would be an 8%
13 increase in funding for nonpublic schools, which amounts to approximately
14 $53 million, and a concurrent decrease in that amount to NYC public schools
15 and students. Instead of an allocation of $626 million to public schools and
16 $91 million to nonpublic schools, only $573 million would be available to
17 allocate to public schools, and $144 million would be allocated to nonpublic
18 schools.
19 b. Chicago: If the CBOE were to use the Rule’s Option #2 methodology for
20 calculating the proportional share of equitable services to nonpublic schools,
21 the CBOE would need to use the total enrollment of private school students.
22 The effect of including all nonpublic school students in the calculation of
23 proportional share is a 55% increase in funding ($18.5 to $28.5 million)
24 directed toward nonpublic schools to the detriment of Chicago public schools
25 and the students most vulnerable to the ravages of the pandemic. Under this
26 “Option,” the CBOE would lose over $10 million in emergency relief funds.
27 c. Cleveland: If CMSD were to use the Rule’s Option #2 methodology for
28 calculating the proportional share of equitable services to nonpublic schools,
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1 CMSD would need to use the total enrollment of private school students. The
2 effect of including all nonpublic school students in the calculation of
3 proportional share is a 19.1 percent increase in the nonpublic schools’
4 allocation to the detriment of CMSD public schools and the students most
5 vulnerable to the ravages of the pandemic. Under this “Option,” based on
6 currently available information CMSD would lose $822,045 in emergency
7 relief funds.
8 d. San Francisco: If SFUSD were to use the Rule’s Option #2 methodology for
9 calculating the proportional share of equitable services to nonpublic/private
10 schools, then SFUSD would need to use the total enrollment of private school
11 students. The effect of including all nonpublic/private school students in the
12 calculation of proportional share is an almost 17% increase in funding
13 directed toward nonpublic schools/private schools to the detriment of SFUSD
14 and the students most vulnerable to the ravages of the pandemic. Under this
15 “Option,” the SFUSD’s public schools would lose about $1,736,417 in
16 emergency relief funds.
17 143. The “Options” under the Rule deny the Plaintiff LEAs and their public schools the
18 allocation they are entitled to under the statute and, as a result, deny them the full use of CARES
19 Act funds as intended by Congress. Private schools, on the other hand, would reap a windfall, as
20 their students would receive a far larger share of CARES Act funding for “equitable services” and
21 would be able to use the funds without restriction. The Plaintiff LEAs’ public schools would face
22 a shortfall, an inequitable result wholly at odds with congressional intent.
23 144. Compounding the losses described above, for some of the Plaintiff LEAs, their state
24 governments have already modified or signaled they would modify their state budgets for the
25 coming fiscal years, incorporating the CARES Act Funds to fill the gaps in their public education
26 budgets created by the pandemic. As result of the Department’s Rule, these gaps will not be able
27 to be filled by state budgets, leaving holes in the Plaintiff LEAs’ budgets.
28
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1 a. New York City: The New York State Legislature enacted its Fiscal Year 2021
2 Budget and issued a “pandemic adjustment,” reducing the NYCDOE’s State
3 Foundation Aid by approximately $717 million and backfilling it with
4 CARES Act funding. The Rule reduces the amount or flexible uses of this
5 funding.
6 b. Cleveland: The Ohio Governor recently signaled the Fiscal Year 2021 Budget
7 will reduce State Foundation Funding support to schools at similar rates as the
8 state’s last-minute cuts in Fiscal Year 2020. The Governor made clear he
9 considered the amount of CARES Act funding CMSD would receive in
10 making cuts in state support, but that CARES Act funding cannot be relied
11 upon under the Rule. The result is a gap in funding for students and teachers
12 in public schools who are in dire need.
13 145. The Rule imposes significant burdens on the Plaintiff LEAs and greatly harms the
14 students and teachers in their public schools. The confusion arising from the Department’s
15 Guidance Document and the Rule has resulted in a delay in distribution of funds to students and
16 teachers in the Plaintiff LEAs’ public schools and has deprived them of the CARES Act funds to
17 which they are entitled, including for continuing essential services and payment of staff salaries
18 during the pandemic.
19 146. The Rule will have a long-term negative impact on the millions of public-school
20 students in the Plaintiff LEAs’ schools affected by the COVID-19 pandemic. If the amount of
21 CARES Act funds is decreased for all public schools, the educational services in those schools
22 will, of necessity, be curtailed.
23 147. These outcomes are contrary to the very purpose and intent of the CARES Act, which
24 Congress enacted to provide immediate services and support to school districts in response to the
25 COVID-19 pandemic—such as new technology for distance learning, meals to students and
26 families, increased sanitation and other facilities-related services—and assist with maintaining
27 school staff and programs during the public health crisis.
28
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1 C. Immediate and Irreparable Harms to Public Schools and Students
2 148. The Plaintiff States and Plaintiff LEAs also have an interest in protecting the health,
3 safety, education, and well-being of their residents and students. The Department’s interpretation
4 severely impacts the use of the emergency ESSER/GEER funds for public-school students
5 affected by the COVID-19 pandemic. It therefore jeopardizes the education of the Plaintiff
6 States’ and LEAs’ more than ten million public-school students.
7 149. Indeed, above and beyond their state constitutional obligations to educate school-aged
8 children, as set forth above, the States have made it a priority to ensure that vulnerable students
9 like those who are served by Title I-A receive robust educational opportunities. See, e.g., Cal.
10 Educ. Code §§ 8801 (Healthy Start Support Services for Children Act), 42920 (educational
11 services for foster youth); Wis. Stat. §§ 118.43-44 (Achievement Gap Reduction Program),
12 121.136 (state aid for high-poverty school districts), 115.28(23) & 115.43-44 (Wisconsin
13 Educational Opportunity Program); Md. Code Ann., Educ. §§ 5-216 (Maryland Early Literacy
14 Initiative for qualifying Title I schools), 7-101.2 (Prekindergarten Expansion Grant Program and
15 Fund), 7-602 (State Free Feeding Program); Md. Code Regs. 13A.01.06 (educational equity focus
16 on marginalized student groups), 13A.08.07 (School Stability for Foster Students); Haw. Rev.
17 Stat. § 302a-449 (Title I-Funded Prekindergarten). The Rule undermines and frustrates these
18 State policies.
19 150. Option #2 (Private school enrollment Option) of the Rule harms the States’ and
20 LEAs’ interest in providing educational opportunities for their most vulnerable students by
21 requiring LEAs to divert moneys away from their public schools to private-school students who
22 are not at-risk and therefore would not be eligible for equitable services under Title I-A.
23 151. Even if LEAs in Plaintiff States and Plaintiff LEAs calculate the proportional share of
24 CARES Act funds for private-school students under Option #1 in the Rule, public schools in the
25 Plaintiff States and LEAs that were intended to receive money under the CARES Act will lose
26 access to these funds. Non-Title I schools will receive no funds. And Title I schools will not be
27 able to use the CARES Acts to cover existing, ongoing costs, even if related to the pandemic, as
28 such allocation would lead to a violation of the LEA’s Title I-A supplanting prohibition.
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1 152. Public school systems depend on state moneys. The CARES Act education
2 stabilization funding is intended to assist public school systems, including both Title I and non-
3 Title I schools, to address the numerous issues created by the pandemic. Private-school interests
4 are addressed through eligibility for other stimulus funding within the CARES Act.
5 153. Protecting and maintaining public-school education in the Plaintiff States and
6 Plaintiff LEAs is imperative to ensuring the long-term success of students. The loss of federal
7 funding for public schools will have significant, adverse impacts on public-school students. The
8 States have an interest in ensuring that funds are not diverted from other vital state priorities and
9 programs providing long-term assistance to public-school students who would otherwise have had
10 access to a free and quality public education absent the Rule.
11 154. The Rule will injure the States’ interests by causing significant harm to their
12 residents, including children and other students who attend K-12 public-school educational
13 institutions within the States.
14 CAUSES OF ACTION
15 COUNT I
Violation of Separation of Powers Principles
16
17 155. Plaintiffs incorporate by reference the foregoing paragraphs of this Complaint as if set
18 forth herein.
19 156. Article I, Section 1 of the U.S. Constitution enumerates that “[a]ll legislative Powers
20 herein granted shall be vested in . . . Congress.”
21 157. Article I, Section 8 of the U.S. Constitution vests exclusively in Congress the
22 spending power to “provide for . . . the general Welfare of the United States.”
23 158. The executive branch’s authority to act “must stem either from an act of Congress or
24 from the Constitution itself.” Youngstown Sheet & Tube Co. v. Sawyer, 343 U.S. 579, 585
25 (1952); see also Clinton v. City of New York, 524 U.S. 417, 438 (1998) (“[N]o provision in the
26 Constitution . . . authorizes the President to enact, to amend, or to repeal statutes.”).
27 159. This principle is particularly strong in the spending context, because “[w]hen it comes
28 to spending, the President has none of his own constitutional powers to rely upon.” California v.
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1 Trump, No. 19-16299, 2020 WL 3480841, at *16 (9th Cir. June 26, 2020) (quoting San
2 Francisco, 897 F.3d at 1233–34). Thus, “[a]bsent congressional authorization, the
3 Administration may not redistribute or withhold properly appropriated funds in order to effectuate
4 its own policy goals.” See San Francisco, 897 F.3d at 1235. Nor may it impose conditions on
5 funds appropriated by Congress without congressional authorization. See id. at 1233–34.
6 160. The Department’s Rule and Guidance Document require LEAs to allocate or use
7 GEER and ESSER funds in a manner that is contrary to the plain language of Section 18005 of
8 the CARES Act, thereby violating constitutional separation of powers principles by requiring
9 distribution of funds based on conditions not provided for in the CARES Act. Defendants did not
10 have inherent authority to change the manner in which LEAs distribute the GEER and ESSER
11 funds. Nor did Congress afford Defendants any discretion or authority to issue rules governing
12 the LEAs’ allocation or use of these funds through the CARES Act.
13 161. By unilaterally imposing its interpretation of Section 18005 of the CARES Act, the
14 Department abrogated the significant discretion given to the SEAs and LEAs in the CARES Act
15 and usurped Congress’ power to legislate in violation of the principles of separation of powers.
16 162. Absent injunctive and declaratory relief suspending and vacating the Rule and the
17 Guidance Document, Plaintiffs and their residents will be immediately, continuously, and
18 irreparably harmed by Defendants’ illegal actions.
19 COUNT II
Ultra Vires Action
20
21 163. Plaintiffs incorporate by reference the foregoing paragraphs of this Complaint as if set
22 forth herein.
23 164. An agency acts ultra vires when it exceeds its statutory authority conferred by
24 Congress.
25 165. There is no provision in the CARES Act that imposes the proportional share
26 calculations, use restrictions, or eligibility requirements in the Rule for CARES Act funds.
27 Further, Congress has not delegated to Defendants the authority to impose such requirements.
28
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1 166. Nothing in the CARES Act requires LEAs to calculate the private-school student
2 share of CARES Act funds using the Section 8501 calculation; prohibits non-Title I schools from
3 receiving funds; prohibits Title I schools from using CARES Act funds on any of the permissible
4 uses in the statute; or requires LEAs to provide equitable services to all private-school students.
5 Moreover, Congress explicitly required that LEAs follow Section 1117 when apportioning
6 CARES Act funds for equitable services and determining which private students were eligible for
7 such services. Congress also explicitly listed permitted uses for the CARES Act funds and
8 permitted both Title I and non-Title I schools to receive and use CARES Act funds.
9 167. Through the CARES Act, Congress required the Department to issue ESSER funds to
10 Plaintiff States’ SEAs without conditioning the receipt of funds on Plaintiffs’ agreement to
11 require LEAs to calculate the proportional share for equitable services with the improper Section
12 8501 formula, prohibit non-Title I schools from receiving funds, prohibit Title I schools from
13 using CARES Acts on any of the permissible uses in the statute, or require LEAs to provide
14 equitable services to all private-school students.
15 168. Absent injunctive and declaratory relief suspending and vacating the Rule and the
16 Guidance Document, Plaintiffs and their residents will be immediately, continuously, and
17 irreparably harmed by Defendants’ illegal actions.
18 COUNT III
Spending Clause
19
20 169. Plaintiffs incorporate by reference the foregoing paragraphs of this Complaint as if set
21 forth herein.
22 170. Article I, Section 8, Clause 1 of the United States Constitution, also known as the
23 Spending Clause, states that “Congress shall have Power to lay and collect Taxes, Duties, Imposts
24 and Excises, to pay the Debts and provide for the common Defense and general Welfare of the
25 United States[.]”
26 171. Under the Spending Clause, conditions may not be placed on federal funds that are
27 (1) so coercive that they compel (rather than encourage) recipients to comply, (2) ambiguous, (3)
28
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1 retroactive, or (4) unrelated to the federal interest in a particular program. Nat’l Fed’n of Indep.
2 Bus. v. Sebelius (NFIB), 567 U.S. 519, 575–78 (2012); South Dakota, 483 U.S. at 206–08.
3 172. To the extent that Congress delegated its authority to the Department to impose its
4 own requirements on the allocation and use of GEER and ESSER funds (which it has not), the
5 Department’s Rule and Guidance Document violate the Spending Clause of the U.S. Constitution.
6 173. The Department’s interpretation of Section 18005 of the CARES Act in the Rule and
7 Guidance Document violates the relatedness requirement under the Spending Clause because it is
8 contrary to Congress’s plainly expressed intent in the CARES Act to require SEAs and LEAs to
9 follow Section 1117 when apportioning CARES Act funds for equitable services and determining
10 which private-school students were eligible for such services, and to permit specific uses for the
11 CARES Act funds by both Title I and non-Title I schools.
12 174. The Department’s Rule and Guidance Document also violate the “unambiguous”
13 requirement under the Spending Clause. Congress has not “unambiguously” imposed the
14 requirement that LEAs calculate and set aside their GEER and ESSER Funds for equitable
15 services to all private-school students and teachers, provide equitable services to all private-
16 school students, limit their uses of funds, and limit their distribution of funds to Title I schools
17 only. See Pennhurst, 451 U.S. at 17 (“[I]f Congress intends to impose a condition on the grant of
18 federal moneys, it must do so unambiguously.”).
19 175. In addition, the Department’s interpretation was an improper “post-acceptance”
20 restriction. Id. at 17, 25. States and LEAs “cannot knowingly accept conditions of which they
21 are ‘unaware’ or which they are ‘unable to ascertain.’” Arlington Cent. Sch. Dist. Bd. of Educ. v.
22 Murphy, 548 U.S. 291, 296 (2006) (quoting Pennhurst, 451 U.S. at 17). Accordingly, the
23 Spending Clause does not permit what the Department has improperly done here through
24 unauthorized rulemaking: “surprising participating States with post acceptance or ‘retroactive’
25 conditions” on congressionally appropriated funds. Pennhurst, 451 U.S. at 25; see also NFIB,
26 567 U.S. at 519.
27 176. Plaintiff States and Plaintiff LEAs did not know of the Department’s interpretation at
28 the time they applied for and received emergency financial aid grants from the GEER and ESSER
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1 funds. Therefore, they were unable to exercise their choice knowingly, cognizant of the
2 consequences of their participation, and they were surprised with post acceptance or retroactive
3 conditions.
4 177. Absent injunctive and declaratory relief suspending and vacating the Rule and the
5 Guidance Document, Plaintiffs and their residents will be immediately, continuously, and
6 irreparably harmed by Defendants’ illegal actions.
7 COUNT IV
Violation of the Administrative Procedure Act
8 (Agency Action in Excess of Statutory Authority, Short of Statutory Right, or Not in
9 Accordance with Law)
10 178. Plaintiffs incorporate by reference the foregoing paragraphs of this Complaint as if set
11 forth herein.
12 179. The APA requires that a court hold unlawful and set aside agency action, findings,
13 and conclusions found to be in excess of statutory authority, short of statutory right, or not in
14 accordance with law. 5 U.S.C. § 706(2)(A), (C).
15 180. Congress did not grant the Department authority to interpret or make rules regarding
16 Section 18005 of the CARES Act. The Department’s Rule and the Guidance Document are
17 unauthorized by and contrary to Section 18005 of the CARES Act. They therefore are in excess
18 of statutory authority, short of statutory right, and not in accordance with law.
19 181. To the extent the Department claims that its Guidance Document is merely an
20 interpretation contained in a policy statement, agency manual, or enforcement guideline that lacks
21 the force of law, the Department’s interpretation is entitled to no or only limited deference. The
22 Guidance Document is not persuasive, nor does it reflect thorough consideration, and is contrary
23 to the plain language of the statute it purports to interpret. Congress’s intent in the CARES Act is
24 clear that equitable services are to be provided by LEAs to private-school students and teachers in
25 the same manner as required under Section 1117 of the ESEA.
26
27
28
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1 182. Absent injunctive and declaratory relief suspending and vacating the Rule and the
2 Guidance Document, Plaintiffs and their residents will be immediately, continuously, and
3 irreparably harmed by Defendants’ illegal actions.
4 COUNT V
Violation of the Administrative Procedure Act
5 (Arbitrary and Capricious Agency Action)
6 183. Plaintiffs incorporate by reference the foregoing paragraphs of this Complaint as if set
7 forth herein.
8 184. The APA requires that a court hold unlawful and set aside agency action, findings,
9 and conclusions found to be arbitrary, capricious, or an abuse of discretion. 5 U.S.C.
10 § 706(2)(A).
11 185. A rule is arbitrary and capricious if the agency has “relied on factors which Congress
12 has not intended it to consider, entirely failed to consider an important aspect of the problem,
13 offered an explanation for its decision that runs counter to the evidence before the agency, or is so
14 implausible that it could not be ascribed to a difference in view or the product of agency
15 expertise.” State Farm, 463 U.S. at 43.
16 186. The Department’s interpretation of Section 18005 of the CARES Act in the Rule and
17 the Guidance Document is arbitrary and capricious agency action because, among other reasons,
18 the Department failed to articulate how its position comports with the plain text of Section 18005
19 of the CARES Act and why it was reversing its own guidance regarding how equitable services
20 under Section 1117 should be provided, generating an unexplained inconsistency in the
21 Department’s position of which it appears to be unaware. Further, the Department ignores
22 important aspects of the problem, and its decision to enact the Rule runs counter to the evidence
23 before the Department. The Department also took into account factors Congress did not intend it
24 to consider. Finally, the Department failed to take into account the reliance interests that its
25 former position generated.
26
27
28
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1 187. Absent injunctive and declaratory relief suspending and vacating the Rule and the
2 Guidance Document, Plaintiffs and their residents will be immediately, continuously, and
3 irreparably harmed by Defendants’ illegal actions.
4 COUNT VI
Violation of the Administrative Procedure Act
5 (Agency Action Without Observance of Procedure Required by Law)
6 188. Plaintiffs incorporate by reference the foregoing paragraphs of this Complaint as if set
7 forth herein.
8 189. The APA requires that a court hold unlawful and set aside agency action, findings,
9 and conclusions found to be without observance of procedure required by law. 5 U.S.C.
10 § 706(2)(D).
11 190. The agency must publish a “[g]eneral notice of proposed rulemaking” in the Federal
12 Register. 5 U.S.C. § 553(b). That notice must describe “either the terms or substance of the
13 proposed rule or a description of the subjects and issues involved.” 5 U.S.C. § 553(b)(3).
14 191. The agency must further provide “interested persons” an “opportunity to participate
15 in the rule making through submission of written data, views, or arguments with or without
16 opportunity for oral presentation.” 5 U.S.C. § 553(c).
17 192. The Rule is a legislative rule adopted without complying with the notice and
18 comment requirements of the APA.
19 193. The Rule was issued on an interim final basis without good cause.
20 194. The Department failed to establish good cause to waive the notice and public
21 procedures required under the APA due to these procedural requirements being impracticable,
22 unnecessary, or contrary to the public interest. 5 U.S.C. § 553(b).
23 195. Absent injunctive and declaratory relief suspending and vacating the Rule and the
24 Guidance Document, Plaintiffs and their residents will be immediately, continuously, and
25 irreparably harmed by Defendants’ illegal actions.
26 PRAYER FOR RELIEF
27 WHEREFORE, Plaintiffs request that this Court enter judgment in their favor and grant
28 the following relief:
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1 a. Declare the Rule and all versions of the Guidance Document unlawful within the
2 meaning of 5 U.S.C. § 706(2)(A), (C), & (D);
3 b. Preliminarily and permanently enjoin the Department and its officers, employees, and
4 agents from applying and enforcing the Rule or all versions of the Guidance Document;
5 c. Vacate and set aside the Rule and all versions of the Guidance Document;
6 d. Award Plaintiffs reasonable costs and expenses, including attorneys’ fees; and
7 e. Grant such other and further relief as the Court deems just and proper.
8 Dated: July 17, 2020 Respectfully Submitted,
9
DANA NESSEL XAVIER BECERRA
10 Attorney General of Michigan Attorney General of California
MICHAEL NEWMAN
11 /s/ Toni L. Harris Senior Assistant Attorney General
SARAH E. BELTON
12 *FADWA A. HAMMOUD Supervising Deputy Attorney General
Solicitor General
13 *TONI L. HARRIS /s/ Garrett M. Lindsey
*NEIL GIOVANATTI
14 Assistant Attorneys General GARRETT M. LINDSEY
Attorneys for Plaintiff State of Michigan JAMES F. ZAHRADKA II
15 *Appearing pro hac vice REBEKAH A. FRETZ
Deputy Attorneys General
16 Attorneys for Plaintiff State of California
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1 KARL A. RACINE HECTOR BALDERAS
Attorney General of District of Columbia New Mexico Attorney General
2
/s/ Kathleen Konopka /s/ Lisa Giandomenico
3
KATHLEEN KONOPKA P. CHOLLA KHOURY
4 Deputy Attorney General, Public Advocacy LISA GIANDOMENICO*
Division Assistant Attorneys General
5 Attorneys for Plaintiff District of Columbia Attorneys for Plaintiff State of New Mexico
Appearing pro hac vice (application *Appearing pro hac vice
6 forthcoming)
7 JOSH SHAPIRO
CLARE E. CONNORS Attorney General of Pennsylvania
8 Attorney General of Hawaii
/s/ Michael J. Fischer
9 /s/ Kevin M. Richardson
MICHAEL J. FISCHER
10 HOLLY T. SHIKADA Chief Deputy Attorney General
KEVIN M. RICHARDSON Attorneys for Plaintiff Commonwealth of
11 Deputy Attorneys General Pennsylvania
Attorneys for Plaintiff State of Hawaii Appearing pro hac vice (application
12 Appearing pro hac vice (application forthcoming)
forthcoming)
13
JOSHUA L. KAUL
14 AARON M. FREY Attorney General of Wisconsin
Attorney General of Maine
15 /s/ Hannah S. Jurss
/s/ Sarah A. Forster
16 HANNAH S. JURSS
SARAH A. FORSTER* Assistant Attorney General
17 Assistant Attorney General Attorneys for Plaintiff State of Wisconsin
Attorneys for Plaintiff State of Maine Appearing pro hac vice (application
18 *Appearing pro hac vice forthcoming)
19
BRIAN E. FROSH JAMES E. JOHNSON
20 Attorney General of Maryland Corporation Counsel of the City of New York
21 /s/ Steven M. Sullivan /s/ Eric Proshansky
22 STEVEN M. SULLIVAN ERIC PROSHANSKY
Solicitor General HOPE LU
23 Attorneys for Plaintiff State of Maryland GAIL RUBIN
Appearing pro hac vice (application Assistant Corporation Counsel
24 forthcoming) Attorneys for Plaintiff the Board of
Education of the City School District of the
25 City of New York
Appearing pro hac vice (application
26 forthcoming)
27
28
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1 BOARD OF EDUCATION, CITY OF CHICAGO SQUIRE PATTON BOGGS (US) LLP
DEPARTMENT OF LAW
2 /s/ Gabriel Colwell
/s/ Joseph Moriarty
3 GABRIEL COLWELL (CABN 216783)
JOSEPH MORIARTY COLIN R. JENNINGS (OHBN 0068704)
4 General Counsel W. MICHAEL HANNA (OHBN 0020149)
J. ERNEST MINCY EMILY R. SPIVACK (OHBN 0090777)
5 Deputy General Counsel for Litigation
Attorneys for Plaintiff Chicago Board of KEVIN J. BURTZLAFF (OHBN 0039648)
6 Education Cleveland Municipal School District Board
(pro hac vice applications forthcoming) of Education
7 Attorneys for Plaintiff Cleveland Municipal
School District
8 SAN FRANCISCO UNIFIED SCHOOL DISTRICT Appearing pro hac vice (application
forthcoming)
9 /s/ Danielle Houck
10 DANIELLE HOUCK
General Counsel
11 SUSANNE NAOMI STARECKI KIM
Sr. Deputy General Counsel
12 Legal Department
Attorneys for Plaintiff San Francisco Unified
13 School District
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1 ATTESTATION OF SIGNATURES
2 I, Garrett M. Lindsey, hereby attest, pursuant to Local Civil Rule 5-1(i)(3) of the Northern
3 District of California that concurrence in the filing of this document has been obtained from each
4 signatory hereto.
5 Dated: July 17, 2020 /s/ Garrett M. Lindsey
6 GARRETT M. LINDSEY
Deputy Attorney General
7 Attorney for State of California
8
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Exhibit A
Case 3:20-cv-04478-SK Document 24 Filed 07/17/20 Page 67 of 88
PROVIDING EQUITABLE SERVICES TO
STUDENTS AND TEACHERS IN NON-PUBLIC SCHOOLS
UNDER THE CARES ACT PROGRAMS
U.S. Department of Education
Washington, D.C. 20202
April 30, 2020
Case 3:20-cv-04478-SK Document 24 Filed 07/17/20 Page 68 of 88
Purpose of this Document
The purpose of this document is to provide information about equitable services for
students and teachers in non-public schools under the Coronavirus Aid, Relief, and
Economic Security Act (CARES Act), Public Law 116-136, 134 Stat. 281 (Mar. 27, 2020).
The CARES Act authorized the Education Stabilization Fund (ESF), which is a new
appropriation of approximately $30.75 billion that creates funding streams for several
distinct education programs that address the impact of the Novel Coronavirus Disease
2019 (COVID-19) on educational services across the Nation. Under these programs, the
U.S. Department of Education (Department) will make awards to Governors, State
educational agencies (SEAs), and institutions of higher education (IHEs) to help States to
prevent, prepare for, and respond to the devastating effects of COVID-19. The provisions
of the CARES Act relevant to the ESF and other Department programs are available on the
Department’s website at https://oese.ed.gov/offices/education-stabilization-fund/.
Two programs in the ESF require a local educational agency (LEA) that receives funds to
provide equitable services to students and teachers in non-public schools:
x The Governor’s Emergency Education Relief Fund (GEER Fund) totaling
$2,953,230,000 (Section 18002 of the CARES Act).
x The Elementary and Secondary School Emergency Relief Fund (ESSER Fund)
totaling $13,229,265,000 (Section 18003 of the CARES Act).
Other than statutory and regulatory requirements included in the document, such as those
pursuant to the authorizing statute and other applicable laws and regulations, the contents
of the guidance do not have the force and effect of law and are not meant to bind the public
in any way. This document is intended only to provide clarity to the public regarding
existing requirements under the law or agency policies. In addition, it does not create or
confer any rights for or on any person.
The Department will provide additional or updated information as necessary on the
Department’s COVID-19 webpage: https://www.ed.gov/coronavirus. If you have questions
that are not answered in this document, please e-mail COVID-19@ed.gov.
ii
Case 3:20-cv-04478-SK Document 24 Filed 07/17/20 Page 69 of 88
Table of Contents
1. Does the requirement to provide equitable services to students and teachers in non-
public schools apply to any programs under the CARES Act? .........................................1
2. What is a “non-public school” under the CARES Act programs? .................................1
3. Is a for-profit non-public school eligible to receive equitable services for its students
and teachers under the CARES Act programs? .................................................................1
4. Which LEA is responsible for providing equitable services to non-public school
students and teachers under the CARES Act programs? ...................................................1
5. Must an LEA or another public agency maintain control of CARES Act funds used to
provide equitable services? ................................................................................................2
6. Who is responsible for initiating the consultation process and how should it begin? ...2
7. How does an LEA that receives funds under the CARES Act programs provide
equitable services “in the same manner as provided under section 1117 of the ESEA”? .3
8. Must an LEA offer to provide equitable services under the CARES Act programs to
students and teachers in all non-public schools located in the LEA, even if a non-public
school has not previously participated in equitable services under Title I, Part A or Title
VIII of the ESEA? ..............................................................................................................5
9. Are all students and teachers in a non-public school eligible to receive equitable
services under the CARES Act programs? ........................................................................5
10. How does an LEA determine the proportional share of funds that must be reserved to
provide equitable services to non-public school students and teachers under the CARES
Act programs? ....................................................................................................................6
A. What is the base amount on which the proportional share is determined? .............6
B. What data does an LEA use to determine the proportional share?..........................6
C. How does an LEA calculate the proportional share? ..............................................6
11. After an LEA has determined the proportional share of funds for equitable services
under each CARES Act program, how does it then determine the amount of funds
available for services to students and teachers in individual non-public schools? ............7
12. Do the requirements in 34 C.F.R. § 200.66 apply to equitable services under the
CARES Act programs? ......................................................................................................7
13. Is a non-public school whose students and teachers receive equitable services under
the CARES Act programs a “recipient of Federal financial assistance”? ..........................8
14. What services and benefits under the CARES Act programs are available to non-
public school students and teachers?..................................................................................8
iii
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Providing Equitable Services to Students and Teachers
in Non-Public Schools under the CARES Act Programs
1. Does the requirement to provide equitable services to students and teachers in non-
public schools apply to any programs under the CARES Act?
Yes. The CARES Act establishes two new funds to which equitable services requirements
apply. Specifically, a local educational agency (LEA) that receives funds under either the
Governor’s Emergency Education Relief Fund (GEER Fund) (section 18002 of the
CARES Act) or the Elementary and Secondary School Emergency Relief Fund (ESSER
Fund) (section 18003 of the CARES Act) (“CARES Act programs” for purposes of this
document) to provide equitable services to students and teachers in non-public schools in
the same manner as provided under section 1117 of the Elementary and Secondary
Education Act of 1965 (ESEA). (Section 18005(a) of the CARES Act).
An institution of higher education or education-related entity that receives funds under the
GEER Fund is not required to provide equitable services to students and teachers in non-
public schools.
2. What is a “non-public school” under the CARES Act programs?
A “non-public school” means a non-public elementary or secondary school that (A) is
accredited, licensed, or otherwise operates in accordance with State law; and (B) was in
existence prior to the date of the qualifying emergency for the CARES Act programs. For
purposes of this definition, the date of the qualifying emergency is March 13, 2020.
(Section 18007(6) of the CARES Act).
3. Is a for-profit non-public school eligible to receive equitable services for its
students and teachers under the CARES Act programs?
No. A for-profit non-public school is not eligible to receive equitable services for its
students and teachers under the CARES Act programs. Section 18007(6) of the CARES
Act defines a “non-public school” as a non-public elementary or secondary school. Section
18007(8) of the CARES Act incorporates the definitions in ESEA section 8101 for any
terms not defined in the CARES Act. ESEA section 8101(19) and (45) defines “elementary
school” and “secondary school,” respectively, and specifies that they must be non-profit.
4. Which LEA is responsible for providing equitable services to non-public school
students and teachers under the CARES Act programs?
The Department has determined that, under the CARES Act programs, the LEA in which a
non-public school is located is responsible for providing equitable services to students and
teachers in the school, as it is under most ESEA programs that require an LEA to provide
equitable services. Outside of Title I, Part A, the responsibility typically falls on the LEA
in which a non-public school is located because equitable services are generally available
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to all students or teachers in the non-public school in the LEA and the LEA in which the
school is located is closest and best able to meet the needs of students and teachers.
Title I, Part A of the ESEA is different; ESEA section 1117 sets forth a student residency
requirement, rather than a school location requirement, for receipt of equitable services
under Title I, Part A. Only low-achieving students who live in a participating Title I public
school attendance area are eligible for services and, therefore, the LEA where students
reside is responsible for providing equitable services. The CARES Act programs have no
such residency requirement for eligibility for services. Rather, the CARES Act programs
provide LEAs full discretion, unless funds are targeted for a specific purpose or population
of public and non-public school students by the Governor under the GEER Fund or by an
SEA through the SEA reserve under the ESSER Fund (see section 18003(e) of the CARES
Act), to use CARES Act funds to provide educational services to students in public and
non-public schools in the LEA through a broad range of allowable activities. Thus,
providing equitable services with CARES Act funds is similar to other ESEA programs
where equitable services are provided by the LEA in which a non-public school is located.
5. Must an LEA or another public agency maintain control of CARES Act funds used
to provide equitable services?
Yes. Control of funds for services and assistance provided to non-public school students
and teachers under the CARES Act programs, and title to materials, equipment and
property purchased with such funds, must be in a public agency, and a public agency must
administer such funds, materials, equipment, and property. In other words, no funds may
go directly to a non-public school. In addition, services for non-public school students and
teachers must be provided by a public agency directly or through contract with another
public or private entity. (Section 18005(b) of the CARES Act).
6. Who is responsible for initiating the consultation process and how should it begin?
Similar to how an LEA provides equitable services under the ESEA, an LEA is responsible
for initiating the consultation process. It must contact officials in all non-public schools in
the LEA to notify them of the opportunity for their students and teachers to obtain
equitable services under the CARES Act programs. Through this initial contact, the LEA
can explain the services available under the CARES Act programs and how non-public
school students and teachers can participate. If non-public school officials have not been
contacted, they may contact the LEA or the State ombudsman to inquire about equitable
services under the CARES Act programs.
If non-public school officials want equitable services for their students and teachers, the
LEA must consult with those officials during the design and development of the LEA’s
programs and before the LEA makes any decision that affects the opportunity of non-
public school students and teachers to participate in the activities funded under the CARES
Act programs. If a non-public school declines to participate in the CARES Act programs or
does not respond to an LEA’s good-faith effort to make contact, the LEA has no further
responsibility to provide equitable services to students or teachers in that school. The LEA,
however, must be able to demonstrate that it made a good faith effort to contact all the non-
public schools in the LEA.
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7. How does an LEA that receives funds under the CARES Act programs provide
equitable services “in the same manner as provided under section 1117 of the
ESEA”?
An LEA that receives funds under the CARES Act programs must provide equitable
services to students and teachers in a non-public school in the same manner as provided
under section 1117 of the ESEA, as determined in consultation with representatives of
non-public schools. (Section 18005(a) of the CARES Act). This requirement, on its face,
necessitates that the Department interpret how the requirements of section 1117 apply to
the CARES Act programs, given that an LEA under the CARES Act programs may serve
all non-public school students and teachers without regard to family income, residency, or
eligibility based on low achievement. Unless the requirements of section 1117 would limit
equitable services under the CARES Act programs, we conclude they apply as outlined
below.
We have interpreted “in the same manner as under section 1117” in light of the
significantly broader eligibility and uses of funds authorized under the CARES Act as
compared to Title I, Part A, reasonably reconciling differences. In doing so, we gave
meaning to section 1117(a)(3), which requires educational services and other benefits for
students in non-public schools to be equitable in comparison to those for public school
students. The services that an LEA may provide under the CARES Act programs are
clearly available to all public school students and teachers, not only low-achieving students
and their teachers as under Title I, Part A. Similarly, there is no limitation on residence in a
participating Title I public school attendance area for services provided in public schools
under the CARES Act programs. For CARES Act services to be equitable in comparison to
public school students and teachers, it follows that the same principles must apply in
providing equitable services to non-public school students and teachers.
The following describes how the provisions of ESEA section 1117 apply, reconciled, when
necessary, to meet the purposes of the CARES Act programs:
x 1117(a)(1) – Under Title I, Part A, an LEA must provide equitable services to low-
achieving students as defined in ESEA section 1115(c) who reside in a
participating Title I public school attendance area and attend a non-public school
and their teachers. Under the CARES Act programs, an LEA may provide equitable
services with CARES Act funds to any students and teachers in non-public schools,
unless limited by a Governor under section 18002 of the CARES Act or an SEA
through the SEA’s reserve under section 18003(e) of the CARES Act. (See
Questions #8 and #9).
x 1117(a)(2) – Under both Title I, Part A and the CARES Act programs, an LEA
must provide equitable services and other benefits, including materials and
equipment, that are secular, neutral, and nonideological.
x 1117(a)(3)(A) – Under both Title I, Part A and the CARES Act programs, an LEA
must provide services and other benefits for non-public school students and
teachers in a timely manner that are equitable in comparison to the services and
benefits provided for public school students and teachers.
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x 1117(a)(3)(B) – Under Title I, Part A, an SEA must designate an ombudsman to
monitor and enforce the equitable services requirements. An SEA must use the
ombudsman also to monitor and enforce the requirements of the CARES Act
programs that an LEA provide equitable services to students and teachers in non-
public schools.
x 1117(a)(4)(A) – Under both Title I, Part A and the CARES Act programs, an LEA
must determine the proportional share available to provide equitable services to
students and teachers in non-public schools based on the total amount of funds an
LEA receives prior to any allowable expenditures or transfers. Under the CARES
Act programs, the LEA calculates the proportional share based on the number of
children enrolled in each non-public school whose students or teachers participate
in the CARES Act programs compared to the number of students enrolled in public
schools in the LEA. The LEA makes this determination under each CARES Act
program separately. (See Question #10).
x 1117(a)(4)(B) – Under Title I, Part A, an LEA must obligate funds available for
equitable services in the fiscal year for which the funds are received by the LEA.
An LEA must obligate CARES Act funds for equitable services in the fiscal years
for which those funds are intended for services to address the impact of COVID-19.
x 1117(a)(4)(C) – Under both Title I, Part A and the CARES Act programs, an SEA
must provide notice in a timely manner to appropriate non-public school officials in
the State of the allocation of funds for educational services and other benefits that
each LEA has determined are available for non-public school students and teachers.
x 1117(b)(1) – Under both Title I, Part A and the CARES Act programs, an LEA
must consult with appropriate non-public school officials during the design and
development of the LEA’s activities on relevant issues such as those contained in
this section of Title I, Part A. The LEA and non-public school officials shall both
have the goal of reaching agreement on how to provide equitable and effective
services and the LEA must transmit the results of that agreement to the
ombudsman.
x 1117(b)(2) – Under both Title I, Part A and the CARES Act programs, if an LEA
disagrees with the views of non-public school officials during consultation, the
LEA must provide in writing to the non-public school officials the reasons why the
LEA disagrees.
x 1117(b)(3) – Under both Title I, Part A and the CARES Act programs, consultation
must occur before an LEA makes any decision that affects the opportunities of non-
public students and teachers to receive equitable services. Meetings between the
LEA and non-public school officials need not occur in person if they cannot be
conducted due to closed schools or social distancing rules. In this case, the
Department recommends LEAs and non-public school officials consult remotely.
x 1117(b)(4) – Under both Title I, Part A and the CARES Act programs, consultation
must include discussion of service delivery mechanisms an LEA may use to
provide equitable services.
x 1117(b)(5) – Under both Title I, Part A and the CARES Act programs, an LEA
must maintain and provide to the SEA written affirmation signed by non-public
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school officials that timely and meaningful consultation has occurred and, if non-
public school officials do not provide such affirmation, the LEA must forward to
the SEA the documentation that such consultation has, or attempts at such
consultation have, taken place.
x 1117(b)(6) – Under both Title I, Part A and the CARES Act programs, non-public
school officials have a right to file a complaint with the SEA; the SEA must
provide services directly or through contracts if requested to do so by non-public
school officials and the SEA determines that the LEA did not meet applicable
requirements.
x 1117(c)(1) – Under Title I, Part A, to determine the proportional share, an LEA
must calculate the number of children, ages 5 through 17, who are from low-
income families and reside in a participating Title I public school attendance area.
Because an LEA determines the proportional share based on enrollment in public
and non-public schools under the CARES Act programs, the LEA need not collect
poverty data from non-public schools (see Question #10 for information on
determining the proportional share of CARES Act funds the LEA must reserve to
provide equitable services to non-public school students and teachers).
x 1117(c)(2) – Under Title I, Part A, non-public school officials may file a complaint
with the SEA if they dispute the count of children from low-income families.
Because an LEA need not collect poverty data to determine the proportional share
available for equitable services under the CARES Act programs, there would be no
reason for non-public school officials to file a complaint regarding poverty data
with the SEA.
x 1117(d) – Under Title I, Part A, control of funds and title to materials, equipment,
and property must be in public agency. With respect to the CARES Act programs,
this provision is superseded by section 18005(b) of the CARES Act, which also
requires public control of funds. (See Question #5).
8. Must an LEA offer to provide equitable services under the CARES Act programs
to students and teachers in all non-public schools located in the LEA, even if a non-
public school has not previously participated in equitable services under Title I, Part
A or Title VIII of the ESEA?
Yes. An LEA must offer to provide equitable services under the CARES Act programs to
students and teachers in all non-public schools located in the LEA, even if a non-public
school has not previously participated under Title I, Part A or Title VIII of the ESEA.
9. Are all students and teachers in a non-public school eligible to receive equitable
services under the CARES Act programs?
Yes. All students and teachers in a non-public school are eligible to receive equitable
services under the CARES Act programs, unless a Governor (under the GEER Fund) or an
SEA (through the SEA reserve under the ESSER Fund) targets funds for a specific purpose
or population of public and non-public school students. Unlike Title I, Part A, equitable
services under the CARES Act programs are not based on residence in a participating Title
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I public school attendance area and are also not limited only to low-achieving students and
their teachers.
10. How does an LEA determine the proportional share of funds that must be
reserved to provide equitable services to non-public school students and teachers
under the CARES Act programs?
A. What is the base amount on which the proportional share is determined?
Under ESEA section 1117(a)(4)(A)(ii), an LEA must determine the proportional
share available for equitable services from the total amount of Title I, Part A funds
it receives prior to reserving funds for allowable expenditures such as
administrative costs or districtwide expenditures, and before making allocations to
participating public schools. Because section 18005(a) of the CARES Act requires
an LEA to provide equitable services under the CARES Act programs “in the same
manner as provided under section 1117,” an LEA must use the total allocation it
receives under each CARES Act program to determine the proportional share
available for equitable services before reserving funds for other purposes.
B. What data does an LEA use to determine the proportional share?
An LEA uses enrollment data in non-public schools whose students and teachers
will participate under the CARES Act programs compared to enrollment in public
schools in the LEA to determine the proportional share. Under the CARES Act
programs, services are available for all students—public and non-public—without
regard to poverty, low achievement, or residence in a participating Title I public
school attendance area. An LEA that receives CARES Act funds uses those funds
to provide educational services to students in both public and non-public schools
through a broad range of allowable activities. Using enrollment to determine the
proportional share from which to provide equitable services will contribute to the
equitable treatment of children and teachers within the statutory universe of
permissible uses for CARES Act dollars by allowing all students and teachers in a
non-public school to receive services that are equitable compared to those available
to all public school students and teachers. (See ESEA section 1117(a)(3)).
C. How does an LEA calculate the proportional share?
To calculate the proportional share for equitable services under the CARES Act
programs, an LEA determines the overall number of children who are enrolled in
public schools and non-public schools in the LEA that wish to participate under one
or both CARES Act programs. Using the proportion of students who are enrolled in
participating non-public schools, the LEA determines the amount of funds available
for equitable services based on that proportional share of the LEA’s total allocation
under each CARES Act program separately. For example, an LEA receiving
$100,000 under the GEER Fund and $900,000 under the ESSER Fund, and with
1,350 public school students and 150 non-public school students, would determine
the proportional share as follows:
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EXAMPLE – DETERMINING THE PROPORTIONAL SHARE
Public Non-Public* Total
Enrollment 1,350 150 1,500
Proportion 90% 10% 100%
Proportional Share $90,000 $10,000 $100,000
GEER Fund
Proportional Share $810,000 $90,000 $900,000
ESSER Fund
*Non-public schools participating under the CARES Act programs.
11. After an LEA has determined the proportional share of funds for equitable
services under each CARES Act program, how does it then determine the amount of
funds available for services to students and teachers in individual non-public schools?
For consultation purposes, in order to determine what equitable services to provide to
students and teachers in a given non-public school, an LEA, after reserving funds that are
reasonable and necessary for administering equitable services under the CARES Act
programs, would divide the remainder of the proportional share of funds available for
equitable services by the total enrollment in non-public schools whose students and
teachers will participate in each of the CARES Act programs to obtain a per-pupil amount.
The LEA would then multiply that per-pupil amount by the enrollment in an individual
non-public school to determine the amount of services the LEA can provide to students
and teachers in that school. With agreement between the LEA and appropriate non-public
school officials, the LEA may pool funds among a group of non-public schools and
provide equitable services to students and teachers in non-public schools within the pool
based on need without regard to how the funds were generated. (See ESEA section
1117(b)(1)(J)(i)).
12. Do the requirements in 34 C.F.R. § 200.66 apply to equitable services under the
CARES Act programs?
No. The requirements in 34 C.F.R. § 200.66 do not apply to equitable services under the
CARES Act programs. 34 C.F.R. § 200.66 is a Title I, Part A regulation that requires an
LEA to provide Title I, Part A services that (1) supplement, and in no case supplant, the
services that would, in the absence of Title I, Part A services, be available to participating
non-public school students; and (2) only meet the needs of participating non-public school
students and not the needs of the non-public school or the general needs of children in the
non-public school. These provisions are necessary in the Title I, Part A context because
equitable services must be supplemental to what non-public students otherwise receive and
may only be provided to low-achieving students who reside in a participating Title I public
school attendance area and attend a non-public school.
Equitable services under the CARES Act programs are much broader than under Title I,
Part A. Equitable services under the CARES Act programs, by definition, may benefit a
non-public school, such as purchasing supplies to sanitize and clean the facility, or all
students in a non-public school, such as any activity authorized under the ESEA. Unlike
Title I, they are not based on residence in a participating Title I public school attendance
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area or limited only to low-achieving students. Moreover, the CARES Act does not have a
supplement not supplant requirement.
13. Is a non-public school whose students and teachers receive equitable services
under the CARES Act programs a “recipient of Federal financial assistance”?
No. A non-public school whose students and teachers receive equitable services under the
CARES Act programs is not a “recipient of Federal financial assistance.” A public agency
must control and administer the CARES Act funds; in other words, no funds may go
directly to a non-public school. (See Question #5). Thus, a non-public school is not a
recipient of Federal financial assistance by virtue of its students and teachers receiving
equitable services from an LEA under a CARES Act program. As a result, certain Federal
requirements that apply to a recipient of Federal financial assistance are not directly
applicable to a non-public school whose students or teachers receive equitable services
under the CARES Act programs, unless the school otherwise receives Federal financial
assistance for other purposes.
14. What services and benefits under the CARES Act programs are available to non-
public school students and teachers?
In general, the services and benefits available to non-public school students and teachers
are the same as those available to public school students and teachers. Specifically, the
ESSER funds that flow to LEAs by formula may be used for a broad range of allowable
activities. (See section 18003(d) of the CARES Act). The ESSER funds that an SEA may
reserve for State purposes may also be used for a broad range of activities to address issues
responding to COVID-19, unless the SEA decides to target them for a specific purpose or
population of public and non-public school students. For example, an SEA could target the
SEA reserve to provide technology to support distance learning for public and non-public
school students from low-income families. (See section 18003(e) of the CARES Act).
Similarly, a Governor may target GEER funds that it makes available to an LEA for a
specific purpose or population of public and non-public school students. (See section
18002(c)(1) or (3) of the CARES Act).
In sum, equitable services permitted under sections 18002(c)(1) or (3), as applicable, and
18003(d) of the CARES Act must be available to best meet the needs of non-public school
students and teachers, as determined through timely and meaningful consultation and
consistent with any specific purposes established by a Governor under the GEER Fund or
SEA through the SEA reserve under the ESSER Fund, regardless of the specific uses
determined by the LEA to meet its own students’ and teachers’ particular needs.
As noted in Question #5, the control of any services or assistance provided to students and
teachers in a non-public school, and title to materials, equipment, and property purchased
with CARES Act funds, must be in a public agency and a public agency must administer
those funds, materials, equipment, and property. A public entity must provide those
services either directly or through a contract with a public or private entity.
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Exhibit B
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