The Secretary of Education to the Honorable Mark A. Holodick, Ed.D. — Delaware (August 16, 2022)

Summary

A letter dated August 16, 2022 from the Secretary of Education's office, signed by Laura Jimenez, to Secretary Mark A. Holodick of the Delaware Department of Education. It responds to Delaware's written plan, received July 13, 2022, for a reasonable level of tolerance in calculating maintenance of equity under the American Rescue Plan Act of 2021 for very small districts. Delaware has 44 districts serving more than 139,000 students, and for the seven with fewer than 400 students it proposes a 10 percent tolerance, which it says covers less than 0.3 percent of enrollment. The letter gives the example of Gateway Charter School, whose funding fell as its special education mix shifted. The Department determines the approach is reasonable.

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                                    THE SECRETARY OF EDUCATION
                                             WASHINGTON, DC 20202



                                              August 16, 2022

The Honorable Mark A. Holodick, Ed.D.
Secretary of Education
Delaware Department of Education
401 Federal Street, Suite 2
Dover, Delaware 19901-3639

Dear Secretary Holodick:

The U.S. Department of Education (Department) received your written plan for a reasonable
level of tolerance when calculating whether the Delaware Department of Education (DDOE) has
met State maintenance of equity requirements under the American Rescue Plan Act of 2021.
This written plan only applies to a subset of Delaware’s very small local educational agencies
(LEAs). The Department’s implementation of American Rescue Plan (ARP) maintenance of
equity requirements helps ensure that State and local funding supports the students who have
been subject to longstanding opportunity gaps in our education system and have also experienced
the greatest impact from the COVID-19 pandemic. Moreover, the ARP maintenance of equity
requirements are vital for ensuring that State and local educational agencies maintain funding
and staffing levels to address the impacts of the pandemic on our education system, and for
protecting high-need schools and students from disproportionate cuts where any reductions in
State and local effort do occur.

Upon careful review, the Department has determined that it is consistent with the maintenance of
equity requirements to allow a State educational agency (SEA) to calculate whether it has
maintained equity with respect to its very small high-need and highest-poverty LEAs within a
reasonable “tolerance level.” The Department’s determination is based on the possibility
of significant volatility in the calculated per-pupil funding amounts for very small LEAs caused
by small changes in student enrollment which may be unrelated to whether an SEA has achieved
the intent to maintain equity in funding. (See Frequently Asked Questions, American Rescue
Plan Elementary and Secondary School Emergency Relief Program, Maintenance of Equity
Requirements, July 26, 2022, Question 21(a).)

After meeting with DDOE, we understand that Delaware’s school funding system is based on
unit counts that differ depending on the services required to educate each student. 1 As a result,
the calculated per-pupil funding amounts for Delaware’s very small LEAs are significantly
affected by small changes in total student enrollment or enrollment in specific student groups for
which funding is based on the cost of education. This makes the per-pupil funding amounts in
Delaware’s very small LEAs an imperfect indicator of whether the SEA has achieved the intent
of maintaining equity in funding across LEAs. For example, in Gateway Charter School
(Gateway), the LEA enrollment increased from 158 students in FY 2021 to 178 students in FY

1
 The Delaware Code (https://delcode.delaware.gov/title14/) and State Annual Appropriations Act
(https://legis.delaware.gov/Offices/ControllerGeneral/AppropriationBills)
                                THE SECRETARY OF EDUCATION
                                       WASHINGTON, DC 20202



2022. However, the student population shifted in FY 2022 to include fewer students receiving
complex and intensive special education services. DDOE has provided the Department with
additional information on specific student counts for these service categories that equate to a
reduction of 1.49 funding units. If Gateway’s special education student population had not
shifted in FY 2022, its State funding allocation would have increased by $448,184, which would
have resulted in an increase in the per-pupil funding from FY 2021 to FY 2022.

In summary, on July 13, 2022, we received DDOE’s written plan for a reasonable level of
tolerance when calculating whether the SEA has maintained equity with respect to very small
LEAs. There are 44 LEAs serving more than 139,000 students in Delaware. For the seven LEAs
in Delaware with fewer than 400 students, DDOE proposes to implement a tolerance of 10
percent. DDOE states that, combined, these seven LEAs constitute less than 0.3 percent of
Delaware’s total student enrollment. After reviewing DDOE’s written plan, including the data
submitted, the unique circumstances in the State, and our further State-specific analysis, we have
determined that this approach includes a reasonable level of tolerance when calculating whether
Delaware has maintained equity for very small LEAs.

We appreciate your diligence in developing this plan. If you have any questions, please contact
your program officer at: Delaware.OESE@ed.gov.

                                             Sincerely,


                                             Laura Jimenez

                                             Laura Jimenez
                                             Director, Office of State and Grantee Relations
                                             Office of Elementary and Secondary Education
                                             United States Department of Education


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