Integration

Achievement and Integration Revenue Budget Guide FY2015

This revenue must be reserved and used only for the programs authorized under Minnesota Statutes, section 124D.861 subdivision 2 (a) for the purpose of pursuing academic achievement and racial and economic integration (Minn. Stat. § 124D.862. Subd. 7).

This guide is intended to be used by district personnel when developing achievement and integration revenue budgets. The areas listed below represent a framework within which districts must develop their respective budgets. This guide is not intended to be an exhaustive description of allowable expenses. Rather, it establishes a framework for creating a budget aligned with the Achievement and Integration Revenue Statutes and School Desegregation/Integration Rule.

Achievement and Integration (AI) budgets must directly support the goals of a district’s current AI plan approved by the Minnesota Department of Education (MDE). Integration budgets need to provide sufficient narrative detail to make evident a clear connection between district AI goals and strategies, proposed expenditures, and the goals of the achievement and integration program.

Without substantial evidence that proposed expenditures directly support a district’s AI goals and strategies and meet statutory requirements, a budget cannot be approved by MDE.

ALLOWABLE USES OF REVENUE

This revenue may be used for programs included in achievement and integration plans approved by MDE, as specified in statute, and as described in this document.

ENGLISH LEARNER AND SPECIAL ED PROGRAMS OR INITIATIVES

AI revenue cannot be used to fund these programs or to supplant a district’s existing obligation in these areas.

SEGREGATING ACTIVITIES

AI revenue cannot be used for activities that in any way decrease interracial contact or segregate participants by racial, ethnic, or socioeconomic background.

UNALLOWABLE COSTS

Unallowable costs include any form of adult basic education, lobbying, medical equipment, or vehicles, among others. Please refer to MDE’s Restricted Grid available through School Finance or contact MDE staff to confirm allowable uses of achievement and integration revenue.

BUDGET NARRATIVE

Because it is unlikely that a single line item description of a proposed expenditure will provide enough detail to make evident the connection between expenditures and a district’s AI goals and strategies, districts are asked to submit a budget narrative explaining how proposed line items are linked to programs and strategies in the district’s AI plan.

Space for this narrative is provided in the FY2015 budget worksheet. Districts should add additional pages to the MDE budget worksheet as needed. The narrative will include information for each line item in order to explain what part the proposed expenditure plays in an approved achievement or integration strategy.

Please confirm that all text in your budget worksheets is visible upon submission to MDE and that no additional steps are required to view the complete text.

BUDGET RATIOS

DIRECT SERVICES TO STUDENTS

At least 80 percent of a district’s proposed budget must be used for approved programs providing direct services to students and identified in statute as allowable uses of revenue, excluding the indirect costs of implementing those programs.

Examples include innovative and integrated learning environments, school enrollment choices, family engagement activities, materials or supplies used by students participating in an approved program, cost of the instruction provided to students (instructional staff salary and benefits), transportation of students, etc.

Expenditures in this area may not include administrative costs such as school support staff and other costs listed below as administrative and general support costs.

PROFESSIONAL DEVELOPMENT

Up to 20 percent of the district’s total proposed budget may be used for professional development, staff development activities, and placement services provided by a district. Related expenses include food, supplies or materials used during these activities, and consultants.

Furthermore, professional development expenses and other special expenses in this budget proposal related to travel, food, event space rental or consultants should represent no more than 30 percent of the school district’s total budget from all sources in these areas. For example, General Education and other funds would pay for at least 70 percent of the district’s overall professional development.

ADMINISTRATIVE AND GENERAL SUPPORT COSTS

No more than 10 percent of the budget may support costs such as supervision, program management, support staff, rent of non-district space, photocopiers, and general supplies. This type of cost is incurred in order to provide support for direct student services and for professional development as described above, and should be in amounts proportionate to those expenses.

Expenditures must clearly support implementation of the district’s proposed direct student services and professional development initiatives or they will not be approved. Other acceptable administrative and general support costs include governing boards, percentage of program administrator time, and fiscal agent fees that are specific to administration of a district’s achievement and integration program.

.3 % REVENUE TRANSFER TO MDE

Each fiscal year, .3% of each district’s initial achievement and integration revenue is transferred to MDE for providing oversight and accountability required by statute. MDE revenue estimates will be adjusted so each district’s total eligible reflects this .3% deduction.

BUDGET SUBMISSION ON INTEGRATION BUDGET WORKSHEETS

Budget proposals must be submitted electronically on current Integration Budget Worksheets which are available on the MDE integration website.

COMMUNITY PLANNING

A budget should reflect items in a desegregation plan that was developed in a formal community planning process where the isolated school district or racially identifiable school sites were represented by community members who are not district employees and were at least part of the voting membership of the planning body as referenced in Minnesota Rule 3535.0170 Subpart 3.

CONTRACTED SERVICES/FEES FOR SERVICE/CONSULTANTS

For this type of expenditure, a district should use the budget narrative to explain the need for a consultant and the deliverables specified in the contract or vendor agreement.

CONTRIBUTIONS TO INTEGRATION COLLABORATIVE

List any contributions to your collaborative as separate line item expenditures within the budget worksheet. These line items should correspond to the type of services to be provided by your collaborative. That is, your district’s contributions to a collaborative budget must be listed as either Direct Services for Students, Professional Development, or Admin. For example, if a collaborative is being funded to provide professional development services and programs for increasing student achievement, a district’s contribution for those services must be broken down and listed separately in the Direct Services for Students section of the budget worksheet and in the Professional Development section. For each line item, the dollar amount should reflect a dollar amount that reflects the agreed upon collaborative services and level of contribution to collaborative.

If collaborative does not have a separate, stand-alone collaborative budget, a district’s payment to other districts providing programs or services for collaborative members should use UFARS code Payment to Other Districts. These expenditures should be identified in the line item description column and/or the budget narrative as payment for integration collaborative services on the corresponding budget page for direct student services, professional development, or admin costs. The budget narrative should provide the same level of detail requested for other expenditures above.

As in the past, MDE will continue to review collaborative budgets. However, a collaborative budget is not required to align with the budget ratios listed above. Districts are responsible for providing oversight and implementing accountability measures to ensure that collaborative expenditures of achievement and integration revenue align with allowable uses of funds specified in statute and listed in this budget guide.

DUES AND MEMBERSHIPS

For this type of expenditure, please identify the organization to which dues are to be remitted and the purpose of the membership as it relates to the district’s MDE-approved achievement and integration strategies.

EXISTING OBLIGATIONS OF DISTRICT

The proposed integration budget must benefit students in ways that do not supplant existing obligations of the district. For example, funding inclusive education, multicultural curriculum, or diversity training with integration revenue can possibly be seen as supplanting a separate legal obligation under the Minnesota Inclusive Education Rule (3500.0550).

This rule is not the same legal obligation as the Minnesota Desegregation Rule, nor do the two rules serve identical functions. All districts in Minnesota have a legal obligation under the Inclusive Education Rule to provide a learning environment and a curriculum inclusive of gender, diverse cultures and people with disabilities.

Furthermore, there are many quality programs designed to improve academic achievement or increase equitable access, participation, and outcomes. On its own, a program’s potential to increase achievement or to provide opportunities for increased integration does not justify use of achievement and integration revenue. AI revenue is intended for those programs or initiatives specified in statute and included in a district’ MDE-approved achievement and integration plan.

EXISTING PROGRAMS

If a budget contains expenditures designed to enhance existing programs in order to meet a district’s achievement or integration goals, the budget being appropriated to the program must be referenced in the budget narrative, indicating what part is to be supplemented with achievement and integration revenue and what part is to be funded with other revenue.

INCENTIVE REVENUE

QUALIFYING CRITERIA

A district’s maximum incentive revenue equals $10 per adjusted pupil unit. Districts qualify to receive this revenue if they are implementing a voluntary plan to reduce racial and economic enrollment disparities through intradistrict and/or interdistrict activities included in their approved achievement and integration plan (Minn. Stat. § 124D.862 Subd. 2).

In order to qualify for incentive revenue, a district’s plan must include enrollment activities that will positively impact educational attainment rates or graduation rates. The integration status of a district will determine the type of qualifying criteria it may include in its plan. Integration status refers to whether a district has a racially identifiable school (RIS) or is considered racially isolated, adjoining, or voluntary.

Qualifying enrollment activities will decrease enrollment disparities by offering one or more of the enrollment options listed below. All enrollments must be pro-integrative. In other words, the enrollment activities must reduce racial and economic enrollment disparities between a racially isolated district and its adjoining or voluntary districts. Likewise, qualifying enrollment activities must reduce racial and economic enrollment disparities between the racially identifiable school and other schools in the district serving the same grade level.

At the point of implementation, qualifying enrollment activities will align with allowable uses of revenue authorized in Minnesota Statutes, section 124D.861, subdivision 2 and this budget guide.

For districts within an integration collaborative (racially isolated, adjoining, voluntary districts)

Qualifying enrollment activities at the secondary level will decrease racial and economic enrollment disparities by offering options for students to enroll into the following:

1. Credit-bearing courses held during a normal school day

2. An academic summer program offered by a district

3. A district through the statewide enrollment options process (open enrollment)

4. A district through special agreements between boards.

Qualifying activities at the middle and elementary levels will decrease racial and economic enrollment disparities by offering options for students to enroll into the following:

1. A standards-based academic program offered during a normal school day

2. A research-based academic summer program providing standards-based instruction

3. A district through the statewide enrollment options process (open enrollment)

4. A district through special agreements between boards.

For districts with racially identifiable schools

Qualifying intradistrict activities will address racial and economic enrollment disparities between the RIS and other schools in the district serving the same grade level. Qualifying enrollment activities include the following:

1. Changes to a district’s school attendance boundaries,

2. Magnet schools or programs with enrollment strategies specifically designed to decrease racial and economic enrollment disparities at the RIS,

3. Priority status for students in the RIS attendance area to attend district schools outside their attendance area,

4. Cross-district enrollment agreement with an adjoining school district with a school that has a lower percentage of enrolled protected class students,

5. Targeted school choice outreach to families related to any of the intradistrict activities listed above.

PROCESS FOR INCLUDING INCENTIVE REVENUE IN A BUDGET

In order to receive the revenue to support qualifying activities, districts will report their proposed incentive revenue expenditures to MDE as part of their annual budget submission. Districts may submit line item expenditures up to the maximum amount they qualify to receive under Minnesota Statutes, section 124D.862, subdivision 2 in order to fund qualifying incentive revenue activities.

Incentive revenue must be included in a district’s budget as line item expenditures for the qualifying activities. Incentive revenue expenditures will be listed within the budget by UFARS FIN code 318. The district’s budget narrative will explain how these proposed expenditures are intended to support implementation of the enrollment initiative.

The total of Incentive Revenue proposed expenditures will also be listed separately on the district’s budget coversheet. Districts will receive the lesser of their approved incentive revenue amount, their maximum eligible amount, or what they actually expend.

In its budget narrative, a district will reference the corresponding plan goal and activity in its MDE-approved plan in order to identify qualifying activities. The plan description must clearly align with at least one of the qualifying criteria listed above.

Use of incentive revenue is limited to those expenditures necessary for implementation of qualifying incentive revenue activities. A district may supplement these activities with its initial achievement and integration revenue if implementation costs exceed the district’s maximum eligible incentive revenue.

Revenue amounts for interdistrict enrollment initiatives will be listed in either member districts’ budget to reflect each district’s estimated cost of implementing or participating in the initiative, i.e., if a district incurs no implementation or participation costs, there will be no line item expenditures in that district’s budget for the incentive revenue qualifying activity.

Please note: Districts may amend FY 2014 achievement and integration plans to include incentive revenue-qualifying activities.

PERSONNEL SALARY AND BENEFITS

Personnel-related expenses must be clearly linked to a specific achievement or integration strategy tied to a plan goal. Because expenditures are listed using UFARS codes, districts must use separate line items for different types of benefits linked to a single position.

RACIALLY IDENTIFIABLE SCHOOL EXPENDITURES

Districts with school sites that have been identified by MDE as racially identifiable may include budget items to support implementation of achievement and integration strategies at the racially identifiable school(s) (RIS). The AI budget worksheet includes tabbed pages specifically for RIS. This part of the budget worksheet is to be used only by districts with RIS.

Expenditures for RIS must align with the budget ratios and all other considerations addressed in this guide.

TECHNOLOGY

MDE encourages districts to utilize existing district technology resources to support integration programming if needed. However, use of integration revenue for technology expenditures may be considered if a district addresses the following:

1) The level of the proposed expenditure is at a level appropriate for and is limited to support of specific programs or initiatives included in district’s board approved integration plan,

2) Proposed use of integration revenue for technology does not supplant a district’s responsibility to purchase technology for students using general education revenue, but supplements a district’s technology budget and is specific to strategies included in the district’s integration plan,

3) Requests for technology must be accompanied by the total budget being appropriated for technology within a district and indicate what part is to be funded with integration revenue and what is to be funded by other revenue (Minn. Stat. § 124D.86 Subd. 1a (4)),

4) The proposed expenditure(s) shall align with MDE’s current budget guidelines.

Districts should not anticipate making on-going purchases of technology with integration revenue, but utilize existing district technology beyond the initial purchase required to implement the integration program.

OTHER BUDGET PROCESSES

ACCOUNTING CODES

Line item expenditures must be listed by UFARS accounting codes. Expenditures cannot be approved unless a specific dollar amount and UFARS code is listed for each line item. Use FIN code 313 for achievement and integration revenue and FIN code 318 for incentive revenue.

ACTUAL EXPENDITURES REPORT

Districts are asked to submit an end-of-year expenditure report using the shaded column on the far right side of the district’s approved integration budget worksheet to list all actual expenditures by UFARS code.

Any expenditure not included in a district’s MDE-approved budget should be highlighted in this report and explained in the Notes and Comments section of that budget worksheet page. Changes over $3,000 require pre-approval from MDE prior to the end of the fiscal year for which the budget was approved (refer to the Budget Amendment guidelines below).

Actual expenditure reports must be submitted electronically to mde.integration@state.mn.us. The FY2015 report will be due December 1, 2016.

BUDGET AMENDMENT

Amendments to integration budgets must fall within the scope of a district’s MDE-approved budget. The amendment process is not an opportunity to add new programs or significantly change the nature of integration work outlined in your district’s plan and budget. This process is intended to accommodate unanticipated changes in staffing, in the district’s eligible funds, or in participation rates. Budget items cannot be approved unless they are part of a district’s current achievement and integration plan. Proposed amendments must be submitted to MDE by May 30 of the fiscal year for which the budget was approved.

For changes representing an increase of $3,000 for any line item or changes equal to or greater than 10 percent of total proposed expenditures, the district must:

1. submit to MDE a copy of the original budget with the proposed amendment(s) highlighted,

2. highlight the proposed line item changes and/or changes in projected overall expenditures,

3. include a rationale for the changes,

4. provide evidence of board approval only for changes that increase overall expenditures (total revenue).

Changes must align with the guidelines detailed in this budget guide, including alignment with statutory goals, participation of other districts, and 80/20/10 ratios explained above. MDE will review the proposed changes and rationale, and provide written approval or denial.

Submit budget amendments to mde.integration@state.mn.us.

Note: corrections to UFARS codes only do not require an amendment.