American Rescue Plan Act of 2021 Provides Additional Funding to Assist Students Most Impacted by COVID-19

Much of the media coverage and discussion of President Joe Biden’s American Rescue Plan Act (ARPA) has focused on stimulus checks and employee paid-leave provisions.  However, ARPA also included several other significant provisions that affect public school districts and their special education programs. 

ARPA allocated nearly $123 billion to a new Elementary and Secondary Schools Emergency Relief (ESSER) fund.  ARPA is the third piece of federal legislation to allocate ESSER funds that school districts can use to address the impact of COVID-19.  The Coronavirus Aid, Relief and Economic Security Act (CARES Act) passed in March 2020 and the Coronavirus Response and Relief Supplemental Appropriations Act (CRRSA Act) passed in December 2020 included ESSER funding for school districts.

The Department of Education (DOE) will allocate the new ESSER funds to state educational agency (i.e., the Wisconsin Department of Public Instruction (DPI)) based on each state’s allocation of Title I Part A funds under the Elementary and Secondary Education Act (ESEA).  Each state educational agency must then allocate at least 90% of the ESSER funds received to local school districts based on the school district’s proportionate share of Title I Part A ESEA funds received in the last fiscal year.  The other 10% of ESSER funds may be reserved by the state educational agency. 

DPI must submit a plan to the Wisconsin Legislature’s Joint Committee on Finance no later than April 12, 2021, explaining how it intends to distribute the new ESSER funds.  DPI has not yet submitted the plan for the new ESSER funds.  Under its distribution plan for the CRRSA Act ESSER funds, DPI utilized some of its 10% reserved funds to ensure every school district received at least $100,000 in ESSER funds.  DPI has indicated it will propose a similar distribution plan for the new ESSER funds and estimated that school districts will receive approximately double their CRRSA Act allocation.

The DOE has already announced that Wisconsin will receive $1.5 billion of the new ESSER fund allocation.  In turn, DPI must distribute at least $1.386 billion of the ESSER funds to Wisconsin school districts.  The ESSER funds will be available until September 30, 2023.

School districts that receive the new ESSER funds must reserve at least 20% of the funds to address lost learning for students disproportionately impacted by the disruption in education caused by COVID-19.  Those students include racial and ethnic minorities, economically disadvantaged students, students with disabilities, English language learners, migratory students, students experiencing homelessness, and students in foster care.  School districts may also use the new ESSER funds for the same activities allowed for ESSER funds under the CARES Act and CRRSA Act.  School districts may also use the new ESSER funds to develop strategies and implement health protocols aligned with the Center for Disease Control guidance on reopening schools. 

The new ESSER funds are subject to a new local “maintenance of equity” requirement for the 2021-2022 and 2022-2023 school years.  The new maintenance of equity limits a school district’s ability to reduce per-pupil aid or full-time equivalent staffing for any “high-poverty school.”  ARPA further defines “high-poverty school” as the 25% of schools serving the highest percentage of economically disadvantaged students in the school district.  The DOE has indicated that further guidance on maintenance of equity calculations will be forthcoming.  

School districts receiving the new ESSER funds must also develop and publish a plan for safely returning students to in-person instruction within thirty (30) days of receiving the funds. The school district must seek public comment on the plan and take such public comments into account in developing the plan before making the plan publicly available.  Once the school district develops the return-to-school plan, it must post the plan on its website.

In addition to the new ESSER funds, ARPA provides other school district revenue.  ARPA also provided $2.58 billion for school-aged children (Part B) flow-through grants and $250 million for infant and toddler (Part C) flow-through grants under the Individuals with Disabilities Education Act (IDEA). ARPA explicitly states that the new funding is in addition to funds already appropriated under the IDEA for the 2021 fiscal year.  The DOE has not indicated how it will allocate the new IDEA funding amongst the states. 

However, ARPA funds present a unique opportunity for school districts to address COVID-19’s significant impact on public education.  ARPA funding is primarily dedicated to helping vulnerable student populations that have been most impacted by school closures and modified instruction methods.  School districts should prepare now for how best to utilize these funds.

For questions regarding this article, please contact the author, Attorney Chad P. Wade (email: cwade@law-rll.com; telephone: 833-654-1176), or your Renning, Lewis & Lacy, s.c., attorney.