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Christie Administration Urges School Districts to Spend

With the deadline to spend ARRA funds fast approaching, school districts are being advised to use it or lose it.

It’s some of the last of the federal stimulus money for New Jersey’s public schools, a cool $200 million still sitting in the bank, and the Christie administration is imploring districts to spend it -- or lose it.

Acting Commissioner Chris Cerf recently sent a memo to all districts and charter schools specifying how much of $540 million in stimulus funds allotted two years ago under the American Recovery and Reinvestment Act (ARRA) had still not been requested by the schools for reimbursement.

In some districts, it was virtually all of the money earmarked through a formula based on the numbers of students classified under the Individuals with Disabilities Education Act (IDEA) and those qualifying as low-income under federal Title I program. For others, there was only a little left.

It may end up being more an accounting issue for most districts, local officials said, since many schools were still billing for salaries and programs. It is just a matter of time before they seek reimbursement from Trenton.

Still, if programs are not in place, there isn’t much time with the school year winding down and the ARRA funds on tight deadlines. What's more the money cannot be carried over to the next year. And Cerf reminded districts that any money not spent by the end of August will have to be returned to the federal government.

"Given the needs of special education and Title I population and the economic situation in New Jersey, it would be ill advised to return these funds unspent to the federal government," Cerf said in the April 26 letter.

"While I understand some districts may have spent the funds, but not yet requested reimbursement, the fact remains that districts are not making the reimbursement requests and thus not receiving the funds," he wrote.

The IDEA and Title I funds are part of what was nearly $2 billion overall in stimulus money allotted over the past two years to New Jersey schools. The bulk was $1.2 in stabilization money that was used by the state to help close the state’s revenue gap, staving off deep state aid cuts that eventually came this year.

Still, these amounts of unspent federal cash for specific programs are considerable. They range from a few thousand dollars in small districts with few special needs students, to more than $20 million still not paid in Newark, close to half of the $40 million in extra Title I and IDEA money allotted them.

"This is not all that unusual, but typically there are carry-over provisions, where ARRA did not have that," said John Donohue, head of the New Jersey Association of School Business Officials, whose members are district business administrators.

He said many districts had moved this money into this year to help cushion the state aid cuts, and many were being cautious not to overspend the amounts. "That conservatism can lead to balances," Donohue said.

"But this is good timing for us, and the commissioner is right that this is much needed money for the children and let’s not give it back," he said.

Meanwhile, the state continues to be concerned about not just whether the money is spent but also how it is being spent. State compliance officers from the Department of Education (DOE) have continued to find a host of accounting and other internal control gaps, including with the IDEA and ARRA funds in question.

In another handful of reviews completed in the past several months in districts like Camden and Long Branch, as well as charter schools such as New Horizon Charter in Newark, common issues continued to crop up over properly documenting expenditures, matching them to the original proposals and other procedural matters.

Last October, then-acting education commissioner Rochelle Hendricks wrote a memo to all districts warning them about the errors and others problems in accounting for the stimulus money.

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