Individuals with Disabilities Education Act (IDEA): State Grant Formulas

Publication Date: January 2003

Publisher: Library of Congress. Congressional Research Service

Author(s):

Research Area: Education

Type:

Abstract:

Congress is considering revisions to the Individuals with Disabilities Education Act (IDEA), which is the major federal statute guaranteeing free appropriate public education (FAPE) for children with disabilities and authorizing state grants to help fund special education and related services for these children. Among the areas that could be considered is the funding of the state grants programs -- especially the "full funding" of the Part B grants-to-states program. This report examines the formulas for the three IDEA state grants programs: the grants-to-states program, which serves mostly school-aged children with disabilities, the preschool program (Section 619), which serves children with disabilities ages 3 to 5, and the infants and toddlers program (Part C), which serves children from birth to age 2.

The report concentrates on the formula provisions of the Part B grants-to-states program, which accounts for most of the funds appropriated for IDEA. After providing for various set-asides amounting to about 2% of the total appropriations for this program, the Secretary of Education allocates a base-year grant to each state, which is the amount a state received for FY1999. Of the remaining amount ($3.3 billion for FY2002), 85% is initially allocated based on states' shares of the preschool- and school-age population, and 15% is allocated based on states' shares of children in the above age group living in poverty. Finally, when appropriations are growing (as they have been in recent years) state allotments are adjusted so that the growth rate of each state's grant closely follows the growth in the overall appropriations for the grants-to-states program. For example, total FY2002 appropriations for the grants-to-states program grew by 18.8%. The state formula limited state grant growth rates to a range between 17.3% and 20.3%. The substate formula for the grants-to-states program is based on similar principles, as are the state and substate formulas for the IDEA preschool state grants program. The Part C formula differs from and is less complex than the Part B formulas. Funds for Part C grants are distributed based on states' share of infants and toddlers -- i.e., total population below the age of 3. There is a one-half percent minimum state grant amount for the Part C formula.

In recent years, Congress has been particularly concerned about funding for special education, which has resulted in substantial increases in funding of the grants to states program, from $2.3 billion in FY1996 to $7.5 billion in FY2002. Despite recent increases, some Members of Congress have also been concerned that appropriations are still far from providing full funding, i.e., maximum state grants authorized by the statute. The Senate version of the No Child Left Behind Act would have appropriated estimated full-funding amounts by FY2007. The final bill did not contain this proposal, in part because some Members argued that IDEA needs to be significantly revised before full funding could be justified. Those revisions are now being considered. The report concludes with a discussion of possible unanticipated and unintended consequences of providing full funding for grants to states. This report will not be updated.