8/28/11

Last week, the Texas Education Agency advised school districts and open-enrollment charter schools to carefully review compliance issues involving infrastructure investments made from ARRA Title XIV State Fiscal Stabilization Fund (SFSF) Grants for school years 2009–2010 and 2010–2011.  The TEA communication indicated that monitoring activities have disclosed significant compliance issues relating to infrastructure investments in school districts and open-enrollment charter schools that could result in financial penalties if questioned amounts are required to be refunded to the Texas Education Agency.  A TEA advisory on this matter was also communicated earlier this calendar year in a TO THE ADMINISTRATOR ADDRESSED letter, dated January 7, 2011 (see http://ritter.tea.state.tx.us/taa/arra01102011.html).  The January 7, 2011 letter explained how to remove infrastructure investments in SFSF applications and replace these activities with other eligible activities.   If school districts and open-enrollment charter schools have concerns related to infrastructure investments, they must take action to amend their SFSF application(s) as soon as possible because the SFSF project ends September 30, 2011 and all ARRA grant funds must be obligated by this date.

The TEA communication last week stated, "The State Fiscal Stabilization Fund (SFSF) grant, which ends September 30, 2011, permits infrastructure investments as allowable costs.  Though this grant permits infrastructure investment costs, local educational  agencies (LEAs) must comply with numerous federal requirements. The Texas Education Agency's (TEA's) Division of Financial Audits has been reviewing LEAs' compliance with these requirements and has found that many LEAs are noncompliant.  Because this grant is still open, noncompliant LEAs have had the opportunity to submit amendments and complete journal entries in order to remove these expenditures from their federal grant and avoid refunding the questioned costs.  Once this grant ends, however, LEAs will no longer have this option and will have to refund all costs questioned by federal, state, and independent auditors. 

For those LEA's that chose to budget and expend SFSF funds on infrastructure investments, please refer to TEA's ARRA - Section 1511 Infrastructure Investment website http://www.tea.state.tx.us/index4.aspx?id=2147484239&menu_id=934&menu_id2=941) for guidance and a list of provisions and assurances related to infrastructure investments.  Please ensure that you are in compliance with all infrastructure investment requirements. If you are out of compliance, you may amend your grant application(s) and complete journal entries to remove these costs from your federal grant.  After September 30, 2011, if these costs are questioned by auditors, you will have to refund the questioned infrastructure investment costs to the federal government.
To request access to initiate an amendment, please have your business manager (or representative with similar authority) email the following information to This e-mail address is being protected from spambots. You need JavaScript enabled to view it :  your LEA's name and county district number, the grant year(s) to be amended, the reason for the amendment request, and a brief description of the intended amendment(s). You will be notified by email when access is approved.

For additional information, please call 512-463-9374 or email This e-mail address is being protected from spambots. You need JavaScript enabled to view it "