Dear Governor Kotek and Director Williams — Waiver of the Maintenance of Effort (July 31, 2023)

Summary

Responding to a March 29, 2023 request, the Department of Education approves Oregon's waiver of the FY 2022 maintenance of effort requirement for elementary and secondary education in a July 31, 2023 letter to Governor Tina Kotek and Director Charlene Williams. It says Oregon missed the requirement by 5.05 percentage points, or $608 million, although it raised support overall and per pupil, and credits the State's account of pandemic-related health, human services and housing spending plus wildfire and drought costs. The letter treats the waiver as separate from maintenance of equity, where two high-need LEAs still need supplemental payments, and says the Department will not act on the FY 2023 request at this time.

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“Dear Governor Kotek and Director Williams — Waiver of the Maintenance of Effort (July 31, 2023).” Original at www.ed.gov. Archived at Pandemic Darlings, https://pandemicdarlings.com/source-documents/department-of-education-fy-2022-waiver-approved-www-ed-gov-82be0acc9b-04bb927dd9/, SHA-256 292fdb4e33f698f5a82ce7b3817f4e6ec9ae24116b08e659dec93dc2f9e16db6.

Full text

                            UNITED STATES DEPARTMENT OF EDUCATION
                                 OFFICE OF ELEMENTARY AND SECONDARY EDUCATION




                                                    July 31, 2023

The Honorable Tina Kotek
Governor of Oregon
900 Court Street, Suite 254
Salem, OR 97301-4047

The Honorable Charlene Williams
Director
Oregon Department of Education
255 Capitol Street, NE
Salem, OR 97310

Dear Governor Kotek and Director Williams:

I am writing in response to the March 29, 2023, request from the Oregon Department of
Education to the U.S. Department of Education (Department) for a waiver of the maintenance of
effort (MOE) requirements in section 317(a) of the Coronavirus Response and Relief
Appropriations Act, 2021 (CRRSA Act) and section 2004(a)(1) of the American Rescue Plan
Act of 2021 (ARP Act). As a condition of receiving CRRSA Act and ARP Act pandemic relief
funds under the Education Stabilization Fund, Oregon assured it would maintain effort for both
elementary and secondary education and higher education in each of fiscal years (FYs) 2022 and
2023.

More specifically, for FY 2022, section 317(a) of the CRRSA Act requires a State that receives
Elementary and Secondary School Emergency Relief funds (ESSER II), Governor’s Emergency
Education Relief funds (GEER II), and funds for the Emergency Assistance to Non-Public
Schools (EANS) program to: 1) maintain State support for elementary and secondary education
at least at the proportional level of the State’s support for elementary and secondary education
relative to the State’s overall spending, averaged over FYs 2017, 2018, and 2019; and
2) maintain State support for higher education at least at the proportional level of the State’s
support for higher education relative to the State’s overall spending, averaged over FYs 2017,
2018, and 2019. This MOE requirement also applies to ARP ESSER funds, and Section
2004(a)(2) of the ARP Act allows the Department to grant a waiver of the MOE requirements
“for the purpose of relieving fiscal burdens incurred by States in preventing, preparing for, and
responding to the coronavirus.”

Under the authority of section 2004(a)(2) of the ARP Act, I am approving Oregon’s request to
waive the MOE requirements in section 317(a) of the CRRSA Act and section 2004(a)(1) of the

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ARP Act with respect to State support for elementary and secondary education to relieve fiscal
burdens incurred by the State for FY 2022.

As indicated in the Department’s Frequently Asked Questions document, the Department’s
approach to MOE waiver requests is rooted in consideration of the impact on students. In
reviewing Oregon’s request for a waiver, the Department considered all information and data
included, as well as the totality of the circumstances. Based on the information submitted, the
Department determined that, consistent with the Department’s interest in a State’s commitment
to education spending, Oregon made increased investments in elementary and secondary
education in FY 2022. Specifically, Oregon increased State support for elementary and
secondary education overall and on a per-pupil basis in FY 2022 compared to the baseline years.

Despite these facts, based on Oregon’s submission, the State failed to meet MOE requirements
by 5.05 percentage points ($608 million) in FY 2022, compared with the baseline years. Oregon
represents that the decrease in proportional education spending was driven by increased State
spending on pandemic-related investments in health care, human services, mental and behavioral
health, housing, and workforce. Oregon also noted that the State experienced additional fiscal
burdens related to historic wildfires in the fall of 2020 and summer of 2021 as well as long-term
drought impacts that required additional state assistance to impacted farmers and communities.

Considering the totality of the circumstances, including the State’s support for elementary and
secondary education, as well as the State’s demonstration of fiscal burdens incurred in
responding to the coronavirus pandemic, the Department approves Oregon’s request for a waiver
of the aforementioned MOE requirements for FY 2022.

This waiver for FY 2022 MOE requirements is distinct from any determination the Department
may make concerning Oregon’s compliance with maintenance of equity requirements for FY
2022 under the ARP Act (§ 2004(b)). Based on data provided by the State, Oregon has not yet
complied with the maintenance of equity requirements in FY 2022 for two high-need LEAs.
Oregon must make supplemental payments to these high-need LEAs that experienced
disproportionate per-pupil funding in FY 2022. Please advise the Department when these
additional payments have been made.

Finally, the Department will not be acting on the State’s request for a waiver of the MOE
requirements for FY 2023 at this time. We strongly encourage the State to take additional steps
to further the State’s commitment to elementary and secondary education in FY 2023.

Thank you for your ongoing commitment to education. If you have any questions, please contact
the Oregon State Mailbox at: Oregon.OESE@ed.gov.

                                                  Sincerely,aura Jimenez

                                                  Laura Jimenez

                                                  Laura Jimenez
                                                  Director, Office of State and Grantee Relations

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