March 2023

Inside this issue:

• Statewide Voluntary Preschool Program Funds
• Special Education Excess Positive Balance Deduction from State Payment to School Districts
• Special Education Reminders
• Education Savings Accounts
• Iowa School Business Management Academy
• Bus Evacuation Drills
• School Bus Driver Licensing Information
• Use of 12-Passenger Vans for Student Transportation
• Bus Inspection Reminders
• Iowa Chart of Account Coding Updates
• Friendly Reminders: Coding for School Meal Accounts
• Medicaid Coding Reminders

Department of Education Resources

• Iowa Department of Education Departmental Directory
• Iowa Department of Education Alphabetical Directory
• Iowa Department of Education Customer Service Guide
• Previous School Business Alerts

Upcoming Deadlines

Staff Contact Information

Financial

Statewide Voluntary Preschool Program Funds

School districts should communicate regularly with community partners to share guidance based on statute and administrative rules regarding the use of Statewide Voluntary Preschool Program (SWVPP) funds. The local community partner contract should also clearly indicate the documentation necessary to demonstrate, for auditing purposes, that SWVPP funds were expended for appropriate uses, the frequency that such documentation must be provided to the district, and potential implications if the terms for providing documentation are not met.

Financial best practices for districts with SWVPP community partners:

• At the beginning of the school year, the district informs each community partner of its maximum amount available for the year, including the value of the amount available for administrative and operational costs, which is limited to 10 percent of the community partner funding. The amount provided should exclude the five percent retained by the district for administrative costs, if applicable.

• Community partners submit detailed expenditure documentation monthly to the district.
  • Payroll records should include salary and benefit costs for each staff member.
  • Supply/equipment purchases should be reflected on itemized invoices.
  • Administrative and operational costs also require documentation.

• The district reviews the submitted documentation prior to reimbursement.
• The district determines allowable expenditures based on the detailed documentation. 
• The district reimburses the community partners for allowable expenditures.
• The district continues monthly review/reimbursement to the community partners until the annual maximum amount is reached.

By statute, the district must flow SWVPP funds to its community partners; however, if a community partner does not expend the full amount allocated, all unexpended funds belong to the district. If the funds were paid prior to verification of expenditures, the community partner is required to return the funds at the close of the given fiscal year (281 IAC 98.13(2)"b" and "c"). Additionally, the district may withhold reimbursement or require the return of any funds already reimbursed that do not have the documentation necessary to illustrate the funds were used appropriately.

Programming questions relating to the SWVPP can be directed to Mary Breyfogle at mary.breyfogle@iowa.gov or 515-326-1030. For more information regarding SWVPP finance, review the SWVPP Finance FAQ or contact Song Luong at song.luong1@iowa.gov or 515-205-0259.

Special Education Excess Positive Balance Deduction from State Payment to School Districts

If you had a 2021-2022 special education excess positive balance, this amount is being deducted beginning with the March 2023 state foundation aid payment. These deductions will continue through the end of the fiscal year. Districts without an excess positive balance may also see a small change in their state aid payment (one-dollar increase or decrease) due to the March recalculation. Payment summaries can be found in the State Payment Information FY23.

If you have additional questions regarding this deduction, please contact John Parker at john.parker@iowa.gov or 515-281-8485.

General Information

Special Education Reminders

Special Education Foster Care Claims

“Foster Care” is used as the title for this claim, but this could be misleading to school districts. It does not mean all students under foster care should be reported as such on a claim. This student status should only be used if all of the following items are applicable:

• The student is served pursuant to an Individualized Education Program (IEP).
• Parental rights have not been terminated.
• The student's parents do not live in Iowa, or where the parents live cannot be determined after reasonable efforts to locate them.
• No Iowa school district counted the student on the special education weighted headcount in October of the current school year.

If any one of these items is not applicable, the district needs to bill the district where the parents lived on the dates served, or bill the district that counted the student on the special education count if the parents moved out of state or could not be located after due diligence. To find which district, if any, counted the student on the special education weighted headcount in October of the current school year, use the Look Back Tool within the Tuition In Billing application.

Special Education Termination of Parental Rights Claims

This student status should only be used if all of the following items are applicable:

• The student is served pursuant to an IEP.
• The parental rights of the student have been terminated.

Note: The school district will file a claim regardless of whether the district counted the student on the special education weighted headcount in October of the current school year.

The district needs to bill the district where the parents lived on the dates served prior to termination of rights. To find which district, if any, counted the student on the special education weighted headcount in October of the current school year, use the Look Back Tool within the Tuition In Billing application.

Special Education Nonpublic Claims

This student status should only be used if all of the following items are applicable:

• The student is served pursuant to an IEP.
• The student is attending an accredited nonpublic school for general education services while receiving special education services from the public school district.
• The cost of providing special education services to the student exceeds the funds generated by the resident district for counting the student on its special education count (billed to the resident district if you are not the resident district) and those funds generated by your district by counting the student as nonpublic shared time on the certified enrollment (if services were provided in the public school and not at the nonpublic school location).

Special Education High-Cost Fund Claims

This student status should only be used if all the following items are applicable:

• The student is served pursuant to an IEP.
• The costs of educating the student exceed three times the state’s average per-pupil expenditure, as calculated annually by the Department of Education (Department), plus the calculated amount of Medicaid eligible expenditures.
• The claim filed by the district or area education agency (AEA) does not qualify as a foster care claim, termination of rights claim, or a nonpublic claim under current Iowa law.

High-Cost Fund Claims are paid by the state from a set-aside portion of IDEA, Part B. The amount set aside might be less than the total amount of high-cost fund claims received. In that case, the amount paid to each district will be prorated. If a claim is filed late, funding will not be available to cover that high-cost fund claim because the available funding will already have been allocated to districts that timely filed.

Contracts and Agreements Between a District and Another Party

School districts may enter into written agreements with specified parties. Best practice would follow the guidelines noted in Iowa Code chapter 28E, even if the agreement is not a 28E contract. All contracts and agreements obligating funds of the district must be signed by the board president. Contracts signed by other school officials may not be enforceable. It is always wise to have the district's attorney review a contract or agreement prior to signing.

If you have further questions, please contact Bill Roederer at bill.roederer@iowa.gov or 515-281-7972.

Education Savings Accounts

All current information regarding Education Savings Accounts can be found here.

Iowa School Business Management Academy

The Iowa School Business Management Academy will hold its Spring Academy May 8-10, 2023, at the Memorial Union, Iowa State University, 2229 Lincoln Way, Ames, IA. Sessions for Levels I-IV will be held May 8-10; graduate-level sessions will be held May 9-10. Online registration is open.

Transportation

Bus Evacuation Drills

All students who are transported in a school vehicle are required to be instructed in safe riding practices and must participate in emergency evacuation drills at least twice per school year, pursuant to Iowa Administrative Code 281 – 43.40. This includes all students who are transported any time during the year, which would include not only daily bus routes but also activity trips and field trips. The rule requires the drills to be performed once in the fall and once in the spring. Additionally, documentation of the drills must be maintained at the local level for five years and made available upon request.

If you have questions, please contact Max Christensen at max.christensen@iowa.gov or 515-336-3965.

School Bus Driver Licensing Information

As a reminder, if a school bus driver is operating a vehicle with a capacity of 16 passengers or more, including the driver, the driver is required to have a Commercial Driver’s License (CDL). If a school bus driver is driving a vehicle with a capacity of 15 passengers or fewer, including the driver, the minimum requirement is a Chauffeur’s Class D3 license.

If you need further clarification, please contact Max Christensen at max.christensen@iowa.gov or 515-336-3965.

Use of 12-Passenger Vans for Student Transportation

In October 2019, new legislation authorized districts to use new vans up to 10-passenger and used vans up to 12-passenger (Iowa Code § 321.373(3)) for pupil transportation. If the district is considering purchasing vans for pupil transportation, helpful notes are provided below:

• Districts that purchase new passenger vans with a capacity of 11 or 12 may not use the vans for pupil transportation.

• The requirement for 11 or 12-passenger vans to be purchased in used condition if they’ll be used for pupil transportation is a federal determination based on a number of federal regulations.

• Any vehicle over 10-passenger capacity being used for student transportation must be built to yellow school bus specifications. Vans do not meet those specifications, meaning 10-passenger vans are allowed and anything larger and purchased new must be a school bus.
• Removing seats does not change the legal van capacity; van capacity is determined by the manufacturer at the time the vehicle is built.
• Any van over 10-passenger used for student transportation must be acquired in used condition. The definition of "used" is defined by Iowa Administrative Code 281 – 44.5(1)(b)(2) and emphasized below:
• The manufacturer’s rated capacity of this vehicle, which shall be determined only by the original equipment manufacturer (OEM) on the date of manufacture, shall not exceed 12 persons including the driver. The capacity rating may not be changed or modified except by the OEM.
• Secondary stage or vehicle conversion manufacturers shall not establish vehicle capacity.
  • Vehicles with a capacity of 10 or fewer passengers, including the driver, may be acquired new or used.
  • Vehicles with a capacity of 11 or 12 passengers, including the driver, shall only be acquired used. 
    • For purposes of this sub-rule, a used vehicle is defined as a vehicle that has had a title transfer from a dealer to one or more previous retail owners.

If you have questions, please contact Max Christensen at max.christensen@iowa.gov or 515-336-3965.

Bus Inspection Reminders

School bus inspections are conducted twice per year at each facility. While the Department does remind entities of upcoming inspections, the School Bus Inspection Schedules are available at any time. Please make sure to review the posted schedule and inform all necessary personnel of the inspection date. Any change of date must be arranged through the bus inspector for your region.

In addition to Department inspections, school bus drivers are required to perform a pre-trip inspection prior to, and a post-trip inspection after, every trip of a school bus. Refer to Iowa Administrative Code 281 – 43.41. The twice-yearly inspections performed by the Department inspectors reveal that most vehicle deficiencies identified are related to items that should be found during the pre- and post-trip inspections performed by school bus drivers. This includes keeping the interior of the bus clean.

Pre-trip and post-trip inspections are a means of finding the day-to-day issues that happen during normal use of the school vehicles. Questions about the proper way to perform daily inspections can be directed to the assigned Department inspector. Sample pre-trip inspection forms are available from the Forms – Inspections page of the Department website.

Bus Inspector Contact Information:

If you have questions, please contact Max Christensen at max.christensen@iowa.gov or 515-336-3965.

Coding

Iowa Chart of Account Coding Updates

The Iowa Chart of Account Coding, found on the Uniform Financial Accounting page of the Department website, is regularly updated to reflect changes necessary to meet fiscal reporting needs. The most recent update is provided below.

February 2023

March 2023

Friendly Reminders: Coding for School Meal Accounts

The Department has been asked a variety of account coding questions relating to school meal accounts in the Nutrition Fund. This article is organized into multiple subtopics as provided below.

• Deposits made to a school meal account
• How to determine and record bad debt 
• Applying revenue to student meal debts 
• Funds donated from private sources
• Funds from a General Fund flexibility account transfer

Deposits made to a school meal account

Deposits made into a school meal account are considered unearned revenues and must be recorded in the Nutrition Fund balance sheet Account 483 - Unearned Revenues. These monies are properly accounted for as a liability (e.g., in the event refunds are requested when a student/adult leaves the district). As students/adults make purchases using funds from their meal account, the purchase becomes a sale with Source 16XX. Districts should record student/adult sales monthly using reports or data from the Point of Sale (POS) system.

Deposit payments made into individual/family food service account

Debit Cash (Fund 61, Account 1XX)

Credit Unearned Revenues (Fund 61, Account 483)

Record student/adult purchases as meal sales monthly using data from POS system

Debit Unearned Revenues (Fund 61, Account 483)

Credit Meal Sale (Fund 61, Source 16XX)

How to determine and record bad debt 

At the end of a school year, districts should make an adjusting journal entry to account for accounts receivable (Account 153) in the Nutrition Fund using reports or data from the POS system.

Bad debts are unpaid meal accounts which are no longer collectible or are too costly to be collected. Review the district’s board policy which defines parameters for determining when a liability is uncollectible and should be considered a bad debt. Once a debt is determined to be a bad debt, the district may set up an estimated bad debt account for the amount deemed uncollectible in the Nutrition Fund balance sheet Account 154, allowance for uncollectible accounts receivable. Balance sheet Account 154 is a contra asset account that reduces the amount of the gross accounts receivable amount on the district's balance sheet.

Record estimated bad debt for uncollectible meal account

Debit Bad Debt Expense (Fund 61, Function 3110, Object 899)

Credit Allowance for Uncollectible Accounts Receivable (Fund 61, Account 154)

Applying revenue to student meal debts

1. Funds donated from private sources

Iowa Code subsection 283A.11(6) authorizes districts to deposit moneys received from private sources for purposes of paying student meal debt in the Nutrition Fund. 

Deposit donated funds from private sources into the Nutrition Fund

Debit Cash (Fund 61, Account 1XX)

Credit Donation for Negative Nutrition Account (Fund 61, Source 1922)

Pay student meal debt with donated funds from private sources

If the debt is already included in the estimated bad debt (Account 154), 

Debit Allowance for Uncollectible Accounts Receivable (Fund 61, Account 154)

Credit Other Accounts Receivable (Fund 61, Account 153)

*Districts may use a district-assigned project code to track the donation.

OR

If the debt has not been included in the estimated bad debt (Account 154),

Debit Bad Debt Expense (Fund 61, Function 3110, Object 899)

Credit Other Accounts Receivable (Fund 61, Account 153)

*Districts may use a district-assigned project code to track the donation.

2. Funds from the General Fund flexibility account

Districts may also deposit funds from the General Fund flexibility account into the unpaid student meals account per Iowa Code subsection 298A.2(2)"c". 

Moneys deposited in the flexibility account may be used by the school district during a budget year beginning on or after the calendar years in which the moneys were transferred to the flexibility account for any of the following:

(6) For deposit in the unpaid student meals account to be used for purposes of paying student meal debt accrued by individual students in accordance with section 283A.11, subsection 6. 

Transfer funds from the General Fund flexibility account into the Nutrition Fund

Debit Flexibility Account (Fund 10, Function 6261, Project 31XX, Object 910)

Credit Interfund Transfer from General Fund (Fund 61, Project 1922, Source 5210)

Pay student meal debt with funds from the General Fund flexibility account

If the debt is already included in the estimated bad debt (Account 154), 

Debit Allowance for Uncollectible Accounts Receivable (Fund 61, Account 154)

Credit Other Accounts Receivable (Fund 61, Account 153)

OR

If the debt has not been included in the estimated bad debt (Account 154),

Debit Bad Debt Expense (Fund 61, Function 3110, Object 899)

Credit Other Accounts Receivable (Fund 61, Account 153)

If you have further questions, please contact Kathy Bowers at kathy.bowers@iowa.gov or 515-210-9674, Jina Brincks at jina.brincks@iowa.gov or 515-313-5942, or Song Luong at song.luong1@iowa.gov or 515-205-0259.

Medicaid Coding Reminders

Medicaid account coding is performed differently from the way most other account coding is completed by Area Education Agencies (AEAs) or Local Education Agencies (LEAs). Since the amount of reimbursement an AEA or LEA will receive from Medicaid for an expenditure is not known at the time the expenditure is incurred, a Medicaid expenditure is initially coded to the appropriate program and/or program levels of the students for whom the expenditure was incurred. When an LEA or AEA receives the Medicaid claim reimbursement, only the revenue retained by the LEA/AEA will be recorded as revenue. The state share portion of the reimbursement received that will be paid to Iowa Health and Human Services (HHS) is recorded on the balance sheet as accounts payable rather than as an expenditure.

Medicaid reimbursement received:

Debit Cash (Fund 10, Account 10X)

Credit Intergovernmental Payables (Fund 10, Program 2XX, Project 3321, Account 410) state share amount due to HHS

Credit Medical Assistance Program-Medicaid (Fund 10, Program 2XX, Project 4634, Source 4634) revenue retained by LEA/AEA

Record state portion when paid back to HHS:

Debit Intergovernmental Payables (Fund 10, Program 2XX, Project 3321, Account 410)

Credit Cash (Fund 10, Account 10X)

Reclassify the expenditures originally charged to special education project codes:

Debit new expenditure code using (Fund 10, Program 2XX, Project 4634)

Credit original expenditure code 

Record receivable if Medicaid not received by June 30 (estimate if amount is unknown):

Debit Intergovernmental Receivables (Fund 10, Project 4634, Account 141) for retained amount

Debit Intergovernmental Receivables (Fund 10, Project 3321, Account 141) for state portion

Credit Intergovernmental Payables (Fund 10, Project 3321, Account 410) for state portion

Credit Medicaid revenue (Fund 10, Project 4634, Source 4634) if received within 60 days after year end

OR

Credit Deferred Inflow (Fund 10, Project 4634, Account 623) if received more than 60 days after year end

Please see the full journal entry examples in the UFA Journal Entries on the Medicaid Journal Entries tab.

If you have further questions, please contact Kathy Bowers at kathy.bowers@iowa.gov or 515-210-9674, Jina Brincks at jina.brincks@iowa.gov or 515-313-5942, or Song Luong at song.luong1@iowa.gov or 515-205-0259.

It is the policy of the Iowa Department of Education not to discriminate on the basis of race, creed, color, sexual orientation, gender identity, national origin, sex, disability, religion, age, political party affiliation, or actual or potential parental, family or marital status in its programs, activities, or employment practices as required by the Iowa Code sections 216.9 and 256.10(2), Titles VI and VII of the Civil Rights Act of 1964 (42 U.S.C. § 2000d and 2000e), the Equal Pay Act of 1973 (29 U.S.C. § 206, et seq.), Title IX (Educational Amendments, 20 U.S.C.§§ 1681 – 1688), Section 504 (Rehabilitation Act of 1973, 29 U.S.C. § 794), and the Americans with Disabilities Act (42 U.S.C. § 12101, et seq.). If you have questions or complaints related to compliance with this policy by the Iowa Department of Education, please contact the legal counsel for the Iowa Department of Education, Grimes State Office Building, 400 E. 14th Street, Des Moines, IA 50319-0146, telephone number: 515-281-5295, or the Director of the Office for Civil Rights, U.S. Department of Education, Citigroup Center, 500 W. Madison Street, Suite 1475, Chicago, IL 60661-4544, telephone number: 312-730-1560, FAX number: 312-730-1576, TDD number: 877-521-2172, email: OCR.Chicago@ed.gov.