Load of Initial State Fiscal Year (SFY) 2026 Allocations

Minnesota Department of Education sent this bulletin at 07/29/2025 01:30 PM CDT

Load of Initial State Fiscal Year (SFY) 2026 Allocations

July 29, 2025

To: School Business Managers, Directors of Special Education, SEDRA Contacts
From: Division of School Finance, Special Education Funding

This is to notify you the SFY 2026 initial allocations have been loaded into the Minnesota Education Grant System (MEGS) for the Finance Codes (FIN) listed below. Please remember from last year that the Minnesota Department of Education (MDE) is only able to initially award $79,354,478 of the Part B Section 611, FIN 419 prior to October 1. The total flow through award for FIN 419 is $202,759,978. MDE will recalculate a new estimate for FIN 419 in early October 2025, which will then only holdback 10 percent of the flow through, which is typical of years past.

The Office of Special Education Programs (OSEP) does allow the full Part B Section 619, FIN 420 to be flowed immediately and thus the amount loaded now only held back 10 percent. We will calculate and load initial awards for both voluntary FIN 425 and mandatory FIN 429 Coordinated Early Intervening Services (CEIS) programs during the October recalculation along with making the deduction for State Services to the Blind (SSB). A second Listserv will go out when the updated estimates are loaded into MEGS in October.

Final allocations will be calculated and loaded into MEGS in March 2026 based on final current year child count and enrollment data.

FIN 419 Individuals with Disabilities Education Act (IDEA) Part B Section 611 Regular
FIN 420 IDEA Part B Section 619 Preschool Incentive, Ages 3-5

Final allocations have been loaded into MEGS for the following finance codes.

FIN 422 Part C Infant and Toddlers, Ages 0-2
FIN 421 Part B Section 611 Regional Low Incidence Discretionary
FIN 423 Part C Regional Interagency Early Intervention Committee (IEIC) Intergovernmental Agreement
FIN 432 Part B Section 611 Regional Low Incidence Comprehensive System of Personnel Development (CSPD) Discretionary

Local educational agencies (LEAs) are required to submit all expenditures in the Special Education Data Reporting Application (SEDRA) by funding source codes. The end of day data from each Tuesday will be edited and validated in SEDRA. Error free lines will be summed to the consolidated Uniform Financial Accounting and Reporting System (UFARS) object code levels and finance codes each Wednesday morning and loaded into MEGS overnight Wednesday. The budgets will be available on Thursday morning in MEGS. MDE anticipates running the first extract for SFY 2026 on August 6, 2025.

Any changes to your budgets will need to be made in SEDRA so that data edits can be applied. The budgets will automatically become funded and active in MEGS, except for those that have SEDRA or MEGS errors, i.e., SEDRA line errors that need MDE approval, budget exceeds total funds available, etc.

With the new MEGS system, local educational agencies (LEAs) are required to closeout each federal finance code at the end of each fiscal year. This must be done prior to any carryover funds being balanced forward into the next fiscal year.

MDE is reminding LEAs who have unspent SFY 2024 funds that if they will not be drawing those funds on SFY 2025 expenditures, they must be drawn against eligible costs incurred in SFY 2026 prior to September 30, 2025. Current, unspent SFY 2024 and/or SFY 2025 funds will not carryover to SFY 2026 until the LEA closes the applicable finance code for SFY 2025. Additionally, starting in SFY 2026, LEAs will not be able to make draw requests for a specific finance code from 2026, until the prior year has been closed. LEAs do not have the ability to reclassify draw requests by course code within MEGS to switch which year’s funds were previously paid. They will need to notify/contact MDE to make the correction in MEGS for the LEA so these funds are not lost.

Please note the new draw deadline date for SFY 2025 is November 30, 2025. If you need additional information on how to complete the closeout report process for SFY 2025 in MEGS to balance forward unspent SFY 2024 funds into SFY 2026 to draw before the deadline, please send a request to the Special Education Funding and Data Team link below.

If you have any questions regarding the allocations for the above finance dimensions, send an email to the Special Education Funding and Data Team.

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