Tuesday, April 14, 2009

New Changes to Article 7

FV Indiana knows that many of our members were very involved in the recent Article 7 revision process. One of the key issues that many of spoke on was the BSEA. Please note the current revision of the sections that address this issue:

To: Members of the Indiana State Board of Education
From: Robert A. Marra Assistant Superintendent for Student Learning
Date: February 25, 2009
Re: Special education rule promulgation
The Department proposes to revise two rules in 511IAC 7 (“Article 7”), and with this memorandum requests Board approval to initiate the rulemaking process. The nature of the proposed revisions and the rationale for the changes are as follows:
1. Amend applicable sections of 511 IAC 7-45 to change due process hearings from a local school corporation conducted hearing to a state conducted hearing and eliminate the state review of locally conducted hearings.
Rationale: The Individuals with Disabilities Education Act (IDEA) requires states to provide a special education due process hearing system in one
of two ways:
 A “one-tiered” system is one in which the state education agency (SEA) is responsible
for conducting the hearings. In a one-tiered system, if either of the parties disagrees with the hearing officer’s decision, they may seek judicial review (“appeal”) in the appropriate state or federal district court.
 A “two-tiered” system puts the responsibility for conducting the due process hearing on the local school corporation and on the SEA for conducting the review (appeal) of the hearing officer’s decision. The intermediate step of the SEA review is required before the parties may seek judicial review in state or federal court.

Article 7 currently establishes a two-tiered due process system. Although the local school corporation conducts the due process hearing, the Department establishes minimum qualifications, recruits, trains, determines continued eligibility to serve, and appoints the independent hearing officers on behalf of the local school corporations. The Department also sets the hearing officer compensation schedule and is the repository for the record of the due process hearing. The school corporation pays the hearing officer’s fees and expenses,1 as well as those of a court reporter. After the local
hearing is completed, if either of the parties seeks review, the Board of Special Education Appeals provides the secondtier review. The Superintendent appoints the Board members, and the Department pays for the members’ time and expenses
when conducting a review.

The Department proposes to revise Article 7 to provide a one-tiered due process system. The majority of states currently utilize a one-tiered system, with a number of
them changing from a twotiered to a one-tiered system over the past ten to fifteen years. In implementing a onetiered system, the Department would continue the activities
described in the previous paragraph, and the local school corporations would continue
to pay the cost of the hearing officer and the court reporter.
The second tier BSEA review would be eliminated, reducing the parties’ time and expense of the intermediate review, as well as those of the Department.

2. Amend 511 IAC 47 to change the process by which a local school corporation or
charter school obtains and receives state funds for excess costs of educating students with disabilities from a system in which the Department contracts with school corporations and service providers to a reimbursement system.

Rationale: Under the current system of funding excess costs, school corporations and charter schools submit an application to the Center for Exceptional Learners. The application packets are extensive and must be approved by Center staff. If approved,
the Department enters into a contract with the school selected service provider2 to
pay for the approved services for up to twelve months. The Department executes in excess of 450 contracts annually under this system. If the application is denied, the school may request that a hearing be conducted by a three-member panel appointed by the Superintendent.

The Department proposes to change the system to one in which the Department reimburses school corporations for excess costs,3 up to the limit of the appropriation.4
The proposed changes would streamline both the school’s and the Department’s activities related to funding the excess costs. For the schools, time and expense would be saved by eliminating the need to prepare a sizable application to submit to the Department. Significant time and expense would be saved by eliminating the need to: (1) review and approve large application packets, (2) develop, process, and execute
more than 450 contracts annually, and (3) process and pay the many claims submitted
from a multitude of contracted vendors.

Under the proposed changes, state funds would be available only for excess costs
associated with placement in a public or private residential program or for placement in
a nonpublic school. With the exception of placement in a nonpublic school, excess costs
of nonresidential (“wraparound”) services would not be reimbursed.

1 School corporations may use their federal Part B special education funds to pay
for the costs of the hearing, but cannot use them to pay attorney’s fees or the costs of a
2 In situations in which the school corporation hires extra staff to provide “wrap around” services(i.e., nonresidential services needed to allow a student to remain in the student’s home community), the Department contracted with the school corporation to pay for the extra staff.
3 For reimbursement purposes, excess costs would be defined as the total funds expended for the eligible service minus the school corporation’s required expenditure.
4 The application process for excess funds would be streamlined. Schools may request reimbursement for eligible excess costs (see footnote #3 for how excess cost will be calculated). A school’s request for reimbursement would require the school to demonstrate the amount of funds expended on eligible services for a student and that such services were provided in accordance with the student’s IEP. The Department would review the requests at the end of the school year and distributions would be made for each request that satisfies the established criteria. If the appropriation is not sufficient to reimburse schools at 100% of the excess costs, reimbursement would be made on a pro rata basis.

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