American Recovery and Reinvestment Act of 2009: IDEA Recovery Funds for Services to Children and Youths with Disabilities
April 1, 2009

The American Recovery and Reinvestment Act of 2009 (ARRA) appropriates significant new funding for programs under Parts B and C of the Individuals with Disabilities Education Act (IDEA). Part B of the IDEA provides funds to state educational agencies (SEAs) and local educational agencies (LEAs) to help them ensure that children with disabilities, including children aged three through five, have access to a free appropriate public education to meet each child's unique needs and prepare him or her for further education, employment, and independent living. Part C of the IDEA provides funds to each state lead agency designated by the Governor to implement statewide systems of coordinated, comprehensive, multidisciplinary interagency programs and make early intervention services available to infants and toddlers with disabilities and their families.

The IDEA funds under ARRA will provide an unprecedented opportunity for states, LEAs, and early intervention service providers to implement innovative strategies to improve outcomes for infants, toddlers, children, and youths with disabilities while stimulating the economy. Under the ARRA, the IDEA funds are provided under three authorities: $11.3 billion is available under Part B Grants to States; $400 million is available under Part B Preschool Grants; and $500 million is available under Part C Grants for Infants and Families. Preliminary information about each state's allocation is available at: This Web site also provides information about the State Fiscal Stabilization Fund (SFSF) under the ARRA, which is separate from the IDEA ARRA funds described in this fact sheet. This document focuses on Part B; additional information on Part C is available at

IDEA, Part B ARRA funds are a key element of the ARRA principles as described below:

Overview of ARRA

Principles: The overall goals of the ARRA are to stimulate the economy in the short term and invest in education and other essential public services to ensure the long-term economic health of our nation. The success of the education part of the ARRA will depend on the shared commitment and responsibility of students, parents, teachers, principals, superintendents, education boards, college presidents, state school chiefs, governors, local officials, and federal officials. Collectively, we must advance ARRA's short-term economic goals by investing quickly, and we must support ARRA's long-term economic goals by investing wisely, using these funds to strengthen education, drive reforms, and improve results for students from early learning through college. Four principles guide the distribution and use of ARRA funds:

  1. Spend funds quickly to save and create jobs. ARRA funds will be distributed quickly to states and other entities in order to avert layoffs and create jobs. States in turn are urged to move rapidly to develop plans for using funds, consistent with ARRA's reporting and accountability requirements, and to promptly begin spending funds to help drive the nation's economic recovery.

  2. Improve student achievement through school improvement and reform. ARRA funds should be used to improve student achievement and help close the achievement gap. In addition, the SFSF requires progress on four reforms previously authorized under the bipartisan Elementary and Secondary Education Act of 1965, as amended, and the America Competes Act of 2007:

    1. Making progress toward rigorous college- and career-ready standards and high-quality assessments that are valid and reliable for all students, including English language learners and students with disabilities;

    2. Establishing pre-K to college and career data systems that track progress and foster continuous improvement;

    3. Making improvements in teacher effectiveness and in the equitable distribution of qualified teachers for all students, particularly students who are most in need;

    4. Providing intensive support and effective interventions for the lowest-performing schools.

  3. Ensure transparency, reporting and accountability. To prevent fraud and abuse, support the most effective uses of ARRA funds, and accurately measure and track results, recipients must publicly report on how funds are used. Due to the unprecedented scope and importance of this investment, ARRA funds are subject to additional and more rigorous reporting requirements than normally apply to grant recipients.

  4. Invest one-time ARRA funds thoughtfully to minimize the "funding cliff." ARRA represents a historic infusion of funds that is expected to be temporary. Depending on the program, these funds are available for only two to three years. These funds should be invested in ways that do not result in unsustainable continuing commitments after the funding expires.

Awarding IDEA Part B Grants to States and Preschool Grants ARRA Funds

The Department of Education awarded 50 percent of the IDEA, Part B Grants to States and Preschool Grants ARRA funds to SEAs on April 1, 2009. The other 50 percent will be awarded by September 30, 2009. These awards will be in addition to the regular Fiscal Year (FY) 2009 Part B Grants to States and Preschool Grants awards that will be made on July 1, 2009 (Grants to States and Preschool Grants) and October 1, 2009 (Grants to States only). Together, these grant awards will constitute a state's total FY 2009 Part B Grants to States and Preschool Grants allocations.

  • A state did not need to submit a new application to receive the first 50 percent of the Part B Grants to States and Preschool Grants ARRA funds because these funds were made available to each state based on the state's eligibility established for FY 2008 Part B funds and the provision of the certification required by section 1607 of the ARRA. The assurances in the state's FY 2008 application, as well as the requirements of the ARRA, apply to these ARRA funds. In order to receive the remaining 50 percent of IDEA, Part B ARRA funds, a state must submit, for review and approval by the Department, additional information that addresses how the state will meet the accountability and reporting requirements in section 1512 of the ARRA.
  • The additional IDEA funds provided under the ARRA do not increase the amount a state would otherwise be able to reserve for state administration or other state-level activities under its regular grants to states FY 2009 award.
  • LEA eligibility for the first 50 percent of the IDEA ARRA funds is based on eligibility established by the LEA for FY 2008 funds.
  • In accordance with the goals of the ARRA, a state should obligate IDEA ARRA funds to LEAs expeditiously, but prudently. A state should make the Part B Grants to States and Preschool Grants ARRA funds that it receives in March available to LEAs by the end of April 2009.
  • Similarly, an LEA should use the IDEA ARRA funds expeditiously, but prudently. An LEA should obligate the majority of these funds during school years 2008-09 and 2009-10 and the remainder during school year 2010-11. States may begin obligating IDEA, Part B ARRA funds immediately upon the effective date of the grant. All IDEA ARRA funds must be obligated by September 30, 2011.

Uses of IDEA, Part B ARRA Funds

All IDEA ARRA funds must be used consistent with the current IDEA, Part B statutory and regulatory requirements and applicable requirements in the General Education Provisions Act (GEPA) and the Education Department General Administrative Regulations (EDGAR). An LEA must use IDEA ARRA funds only for the excess costs of providing special education and related services to children with disabilities, except where IDEA specifically provides otherwise.

  • The IDEA ARRA funds constitute a large one-time increment in IDEA, Part B funding that offers states and LEAs a unique opportunity to improve teaching and learning and results for children with disabilities. Generally, funds should be used for short-term investments that have the potential for long-term benefits, rather than for expenditures the LEAs may not be able to sustain once the ARRA funds are expended. Some possible uses of these limited-term IDEA ARRA funds that are allowable under IDEA and aligned with the core reform goals for which states must provide assurances under SFSF include:

    • Obtain state-of-the art assistive technology devices and provide training in their use to enhance access to the general curriculum for students with disabilities.
    • Provide intensive district-wide professional development for special education and regular education teachers that focuses on scaling-up, through replication, proven and innovative evidence-based school-wide strategies in reading, math, writing and science, and positive behavioral supports to improve outcomes for students with disabilities.
    • Develop or expand the capacity to collect and use data to improve teaching and learning.
    • Expand the availability and range of inclusive placement options for preschoolers with disabilities by developing the capacity of public and private preschool programs to serve these children.
    • Hire transition coordinators to work with employers in the community to develop job placements for youths with disabilities.

Invitation for Waivers

The Secretary intends to issue regulations to allow reasonable adjustments to the limitation on state administration expenditures to help states defray the costs of ARRA data collection requirements.

IDEA, Part B Fiscal Issues

  • An LEA may be able to reduce the level of state and local expenditures otherwise required by the IDEA LEA maintenance of effort (MOE) requirements. Generally, under section 613(a)(2)(C), in any fiscal year that an LEA's IDEA allocation exceeds the amount the LEA received in the previous year, under certain circumstances, the LEA may reduce the level of state and local expenditures by up to 50 percent of the amount of the increase, as long as the LEA uses those freed-up local funds for activities that could be supported under the ESEA, such as services for children at risk of school failure without additional support. If an LEA takes advantage of this provision, the required MOE for future years is reduced consistent with the reduction it took, unless the LEA increases the amount of its state and local expenditures on its own. SEAs should encourage LEAs that can and do take advantage of this flexibility to focus the freed-up local funds on one-time expenditures that will help the state make progress on the goals in the SFSF program, such as improving the equitable distribution of effective teachers and the quality and use of assessments to enhance instruction for students most in need.
  • Alternatively, an LEA may (or in some cases must) use up to 15 percent of its total IDEA, Part B Grants to States and Preschool Grants for early intervening services for children in grades K through 12 who are not currently identified as children with disabilities, but who need additional academic and behavioral support to succeed in a general education environment. However, an LEA may use only up to 15 percent of its allocation minus any amount (on a dollar-for-dollar basis) by which the LEA reduced its required state and local expenditures under section 613(a)(2)(C).
  • State-level MOE may be waived under Part B of the IDEA by the Secretary of Education on a state-by-state basis, for a single year at a time, for exceptional or uncontrollable circumstances, such as a natural disaster or a precipitous and unforeseen decline in the financial resources of a state. LEA-level MOE may not be waived.
  • With prior approval from the Secretary of Education, a state or LEA may count SFSF (but not IDEA ARRA funds) under the ARRA that are used for special education and related services as non-federal funds for purposes of determining whether the state or LEA has met the IDEA, Part B MOE requirements. (See separate fact sheet on SFSF for more information.)

Accountability Principles

As with all federal funds, states and LEAs are responsible for ensuring that the IDEA, Part B ARRA funds are used prudently and in accordance with the law.

  • ARRA requires that recipients of funds made available under that act separately account for, and report on, how those funds are spent.
  • The President and the Secretary are committed to ensuring that ARRA dollars are spent with an unprecedented level of transparency and accountability. The administration will post reports on ARRA expenditures on the Web site.

Additional Information

  • The Department will provide updates as additional information becomes available regarding the details of the IDEA ARRA funds.
  • The Department will also provide further information on the government-wide data collection and reporting requirements as this information becomes available.
  • If you have any questions or concerns, please email them to

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Last Modified: 04/09/2009