[Section 2974 effective until July 1, 2022; see also section 2974 effective July 1, 2022 set out below.]

§ 2974. Special education program; fiscal review

(a) Annually, the Secretary shall report to the State Board regarding:

(1) special education expenditures by supervisory unions;

(2) the rate of growth or decrease in special education costs, including the identity of high- and low-spending supervisory unions;

(3) results for special education students;

(4) the availability of special education staff;

(5) the consistency of special education program implementation statewide;

(6) the status of the education support systems in supervisory unions; and

(7) a statewide summary of the special education student count, including:

(A) the percentage of the total average daily membership represented by special education students statewide and by supervisory union;

(B) the percentage of special education students by disability category; and

(C) the percentage of special education students served by public schools within the supervisory union, by day placement, and by residential placement.

(b) The Secretary’s report shall include the following data for both high- and low-spending supervisory unions:

(1) each supervisory union’s special education staff-to-child count ratios as compared to the State average, including a breakdown of ratios by staffing categories;

(2) each supervisory union’s percentage of students in day programs and residential placements as compared to the State average of students in those placements and information about the categories of disabilities for the students in such placements;

(3) whether the supervisory union was in compliance with section 2901 of this title;

(4) any unusual community characteristics in each supervisory union relevant to special education placements;

(5) a review of high- and low-spending supervisory unions’ special education student count patterns over time;

(6) a review of the supervisory union’s compliance with federal and State requirements to provide a free, appropriate public education to eligible students; and

(7) any other factors affecting its spending.

(c) The Secretary shall review low-spending supervisory unions to determine the reasons for their spending patterns and whether those supervisory unions used cost-effective strategies appropriate to replicate in other supervisory unions.

(d) For the purposes of this section, a “high-spending supervisory union” is a supervisory union that, in the previous school year, spent at least 20 percent more than the statewide average of special education eligible costs per average daily membership. Also for the purposes of this section, a “low-spending supervisory union” is a supervisory union that, in the previous school year, spent no more than 80 percent of the statewide average of special education eligible costs per average daily membership.

(e) The Secretary and Agency staff shall assist the high-spending supervisory unions, which have been identified in subsection (a) of this section and have not presented an explanation for their spending that is satisfactory to the Secretary, to identify reasonable alternatives and to develop a remediation plan. Development of the remediation plan shall include an on-site review. The supervisory union shall have two years to make progress on the remediation plan. At the conclusion of the two years or earlier, the supervisory union shall report its progress on the remediation plan.

(f) Within 30 days of receipt of the supervisory union’s report of progress, the Secretary shall notify the supervisory union that its progress is either satisfactory or not satisfactory.

(1) If the supervisory union fails to make satisfactory progress, the Secretary shall notify the supervisory union that, in the ensuing school year, the Secretary shall withhold 10 percent of the supervisory union’s special education expenditures reimbursement pending satisfactory compliance with the plan.

(2) If the supervisory union fails to make satisfactory progress after the first year of withholding, 10 percent shall be withheld in each subsequent year pending satisfactory compliance with the plan; provided, however, before funds are withheld in any year under this subdivision (f)(2), the supervisory union shall explain to the State Board either the reasons the supervisory union believes it made satisfactory progress on the remediation plan or the reasons it failed to do so. The State Board’s decision whether to withhold funds under this subdivision shall be final.

(3) If the supervisory union makes satisfactory progress under any subdivision of this subsection, the Secretary shall release to the supervisory union any special education expenditures reimbursement withheld for the prior fiscal year only.

(g) Within 10 days after receiving the Secretary’s notice under subdivision (f)(1) of this section, the supervisory union may challenge the Secretary’s decision by filing a written objection to the State Board outlining the reasons the supervisory union believes it made satisfactory progress on the remediation plan. The Secretary may file a written response within 10 days after the supervisory union’s objection is filed. The State Board may give the supervisory union and the Secretary an opportunity to be heard. The State Board’s decision shall be final. The State shall withhold no portion of the supervisory union’s reimbursement before the State Board issues its decision under this subsection.

(h) Nothing in this section shall prevent a supervisory union from seeking and receiving the technical assistance of Agency staff to reduce its special education spending. (Added 1997, No. 60, § 31, eff. June 26, 1997; amended 1997, No. 71 (Adj. Sess.), § 115, eff. March 11, 1998; 1999, No. 117 (Adj. Sess.), § 6; 2007, No. 82, § 10; 2013, No. 92 (Adj. Sess.), § 213, eff. Feb. 14, 2014; 2015, No. 11, § 14; 2015, No. 148 (Adj. Sess.), § 1, eff. July 1, 2017; 2017, No. 74, § 24; 2017, No. 173 (Adj. Sess.), § 5, eff. July 1, 2022.)