October 24, 2005

Honorable June St. Clair Atkinson

Interim Superintendent of Public Instruction

North Carolina Department of Public Instruction

301 North Wilmington Street

Raleigh, North Carolina 27601-2825

Dear Dr. Atkinson:

The purpose of this letter is to respond to North Carolina's March 30,
2005 submission of its Federal Fiscal Year (FFY) 2003 Annual Performance
Report (APR) under the Individuals with Disabilities Education Act
(IDEA) Part B for the grant period July 1, 2003 through June 30, 2004.
The APR reflects actual accomplishments that the State made during the
reporting period, compared to established objectives. The Office of
Special Education Programs (OSEP) has designed the APR under the IDEA to
provide uniform reporting from States and result in high-quality
information across States. The APR is a significant data source for OSEP
in the Continuous Improvement and Focused Monitoring System (CIFMS).

The State's APR should reflect the collection, analysis, and reporting
of relevant data, and include specific databased determinations
regarding performance and compliance in each of the cluster areas. This
letter responds to the State's FFY 2003 APR and Progress Report
submitted on July 29, 2005. OSEP has set out its comments, analysis and
determinations by cluster area.

*Background*

The conclusion of OSEP's October 15, 2004 FFY 2002 APR response letter
required the State to provide: (1) in the FFY 2003 APR, an update
regarding its progress in correcting the areas of noncompliance listed
below; and (2) by July 9, 2005, documentation showing that the State
corrected those areas of noncompliance: (a) timeliness of due process
hearing decisions (34 CFR §300.511(a) and (c)); (b) the provision of a
free appropriate public education (FAPE) to youth with disabilities
incarcerated in local adult correctional facilities (34 CFR §§300.121
and 300.133); (c) the provision of FAPE to children with disabilities
with behavioral issues (34 CFR §300.300); (d) reporting regarding
participation and performance on statewide assessments for children in
out-of-district placements and State-operated programs (34 CFR
§300.139); (e) inviting students to individualized education program
(IEP) meetings where a purpose is the consideration of transition
service needs or needed transition services (34 CFR §300.344(b)(1)); and
(f) transition-related content of IEPs (34 CFR §300.347(b)).

OSEP's October 2004 letter further directed the State to include the
following in the FFY 2003 APR: (1) continued reporting on the State's
progress in ensuring full compliance with the timeline requirements for
formal written complaints (34 CFR §300.661(a) and (b)(1)); (2)
information regarding the extent to which the State's general
supervision system corrected State-identified noncompliance; (3) the
results of the review of policies, procedures and practices completed
when local educational agency (LEA) data show significant
disproportionality (the letter further directed the State to ensure that
all of the language in its FFY 2003 APR was consistent with Federal
law); and (4) either documentation of data (whether collected through
sampling, monitoring, individual IEP review, or other methods) regarding
preschool outcomes, targets for improved performance and strategies to
achieve those targets for this area, or a plan to collect the data,
including a detailed timeline of the activities necessary to implement
that plan.

OSEP visited North Carolina during the week of July 11, 2005 for the
purpose of verifying the effectiveness of the State's systems for
general supervision, data collection under §618 of the IDEA, and
statewide assessment. The results of that visit will be provided to the
State in a separate letter, but are referenced in the appropriate
sections below.

On July 29, 2005, OSEP received a Progress Report from the State.
Details of that report are included in the appropriate sections below.

# *General Supervision*

> [Identification and timely correction of noncompliance]{.underline}

As noted in the 2005 verification visit letter, OSEP found that,
although the North Carolina Department of Public Instruction (NCDPI)
reported that it has ensured the correction of noncompliance identified
through its Continuous Improvement Monitoring (CIM), it has not
maintained documentation of such correction and of the State's
compliance with the requirement of 20 U.S.C. §1232d(b)(3) and 34 CFR
§300.600 to ensure that LEAs correct noncompliance. Therefore, OSEP's
letter directed the State to submit, within 60 days from the date of the
letter, either: (1) documentation that NCDPI was implementing effective
procedures for ensuring the timely (i.e., no later than one year after
NCDPI identifies the noncompliance) correction of noncompliance,
including being able to demonstrate that each public agency has
corrected identified noncompliance; or (2) the State's plan, including
strategies, proposed evidence of change, targets and timelines designed
to ensure that NCDPI is effectively ensuring correction of noncompliance
as soon as possible, but no later than one year from identification.
OSEP will review the plan and determine what further action, if any, is
needed.

In the FFY 2003 APR, on pages 6 and 7, the State also described its
plans to develop a system that would allow it to identify systemic
issues and implement system-wide corrective activities when necessary.
In the SPP, the State must report on its efforts to ensure correction of
noncompliance, whether identified through monitoring, complaint
investigation, due process or some other method.

[Formal written complaints]{.underline}

The Part B regulations require that NCDPI issue its written decision,
for each Part B formal written complaint, within 60 days of receipt of
the complaint, unless the timeline is extended due to exceptional
circumstances with regard to a particular complaint (34 CFR §300.661(a)
and (b)(1)). In its 2001 Self-Assessment, the State reported that from
1998-2001, 50% of formal written complaints were resolved within the
60-day timeline. Data in the State's FFY 2002 APR showed that, during
the July 1, 2002-June 30, 2003 reporting period, the State issued 38 of
39 complaint decisions within the required timelines. OSEP's October
2003 response directed the State to continue to report, in its FFY 2003
APR, on the State's progress in ensuring full compliance with those
requirements.

On pages 10 and 18 of its FFY 2003 APR, the State reported data showing
that, of 86 complaints filed during July 1, 2003-June 30, 2004: (1) 54
were investigated; (2) 42 contained findings of noncompliance; (3) 12
contained no findings of noncompliance; (4) 30 were not investigated
because of lack of jurisdiction or the issues were resolved; (5) two
were set aside and closed within 60 days; (6) 3 were resolved beyond 60
days with documented extensions. No complaints were pending as of August
30, 2004. More current data regarding timely issuance of complaint
decisions was collected in OSEP's verification visit in July 2005, and
are reported in OSEP's letter regarding that visit.

In the SPP, due December 2, 2005, the State must continue to report on
its efforts to ensure full compliance with the complaint timelines.

######## Mediation 

######## 

On page 18 and in Attachment 1 of the FFY 2003 APR, the State included
data and information regarding mediation, indicating that 35 requests
were received for mediation during the reporting period of July 1, 2003
through June 30, 2004, and mediation agreements were reached in all 35
cases. No mediations were reported to be pending as of June 30, 2004.
OSEP appreciates the State's efforts in this area and looks forward to
reviewing data and information regarding the percent of mediations held
that result in mediation agreements, in the SPP.

[Due process hearings and reviews]{.underline}

The Part B regulations require that the final decision in a due process
hearing be reached and mailed to the parties not later than 45 days
after the receipt of a request for a hearing, and that a hearing officer
may grant specific extensions of time beyond that period at the request
of either party (34 CFR §300.511(a) and (c)). Pursuant to these
requirements, a hearing officer may only extend the timeline for a
hearing decision at the request of a party, and, in extending the
timeline, must specify the new date by which the decision will be
reached and mailed to the parties. As further explained below, the State
has not corrected the noncompliance with those requirements that it
identified in its 2001 Self-Assessment.

In its June 2004 letter, OSEP accepted the State's plan to correct
noncompliance with the hearing timeline requirements of 34 CFR
§300.511(a) and (c), and directed the State to submit, no later than 30
days following one year from the date of the letter, documentation that
it had corrected the noncompliance. In its FFY 2002 Part B APR, the
State reported data showing continuing noncompliance. OSEP's October 15,
2004 response to the State's FFY 2002 APR directed the State to: (1)
provide data and analysis demonstrating progress in correcting the
noncompliance, in the FFY 2003 APR; and (2) as required by OSEP's June
2004 letter, submit by July 9, 2005, data and analysis demonstrating
full correction of the noncompliance.

On page 18 of its FFY 2003 APR, the State provided data showing that
decisions were reached in four hearings during the July 1, 2003-June 30,
2004 reporting period, all of which exceeded the 45-day timeline and
none of which had a properly extended timeline. The State further
reported that 27 due process cases filed during the reporting period
remained open for more than 100 days. During OSEP's July 2005 visit, the
State acknowledged that none of the hearing officers documented specific
extensions when they exceeded the 45-day timeline, and, therefore, the
State was not in compliance. The State provided a log showing that, for
the period from January 2, 2004 to April 29, 2005, the State received 88
hearing requests, with only 21 resolved within 45 days.[^1]

On pages 8 and 9 of the FFY 2003 APR, the State reported that,
throughout the 2003-2004 school year, it took action to address due
process hearing timelines, including: (1) meetings between NCDPI staff
and the Office of Administrative Hearings' (OAH's) Chief Administrative
Law Judge (ALJ) and Senior Administrator to explore ways to improve
timelines; (2) and the establishment of "... new procedures to ensure
the regular, routine exchange of relevant information and data regarding
due process petitions and decisions, including copies of all
correspondence regarding extensions for hearings, between the OAH and
\[NCDPI\] in a timely manner. The OAH agreed to fax copies of petitions
for hearings to the SEA immediately upon their receipt." The State also
indicated that, although the OAH had agreed to submit documentation of
extensions of the 45-day timelines, the information has not been
consistently provided. In addition, the FFY 2003 APR included future
activities, timelines and resources to achieve projected targets and
results.

OSEP is concerned that, notwithstanding the requirement in OSEP's June
2004 letter, the State was not able to demonstrate correction of the
noncompliance by July 9, 2005, and remains in noncompliance. Not later
than 60 days from the date of this letter, the State must submit: (1)
updated data on its compliance with the requirements of 34 CFR
§300.511(a) and (c); and (2) to the extent that the State cannot
demonstrate compliance with those requirements, specific strategies that
the State will implement to ensure such compliance as soon as possible,
including strategies to ensure that any extension of the timeline for
the decision in a special education due process hearing is made at the
request of a party and the new due date for the decision is documented
in writing. The State must submit an additional progress by April 14,
2006. If the State does not demonstrate correction of the noncompliance
by June 30, 2006, OSEP will consider designating the State as a
high-risk grantee and including Special Conditions on the State's FFY
2006 Part B Grant Award.

[Personnel]{.underline}

On pages 13 through 16 of the FFY 2003 APR, the State included data and
information regarding "highly qualified" administrators, teachers,
related services providers, paraprofessionals, and other providers,
indicating that, from 2002-2003 to 2003-2004: (1) there was a 9 percent
increase in fully certified and a 1.3 percent decrease in not fully
certified special education teachers who provided educational services
to children with disabilities, aged 3-5; (2) a 10 percent increase in
fully certified and a 1.1 percent decrease in not fully certified
special education teachers who provided educational services to children
with disabilities, aged 6-21; and (3) a 9 percent increase in fully
certified and a 9 percent increase in not fully certified
administrators, related service providers, paraprofessionals, and other
providers who provided educational services to children with
disabilities, aged 3--21. The APR provided projected targets for
2004-06, including statewide training using the train-the-trainer model,
and resources to achieve the projected targets and results. OSEP
appreciates the State's efforts to improve performance in this area.

> [Collection and timely reporting of accurate data]{.underline}

As part of its July 2005 visit, OSEP collected information regarding the
State's system for collecting and reporting data under §618 of the IDEA.
As reported on pages 16 through 17 of the FFY 2003 APR, and confirmed
during the July 2005 visit, the State now uses a web-based system called
the Comprehensive Exceptional Children Accountability System (CECAS) to
collect its child count, environment, and exiting data. The State
reported that CECAS was designed with numerous compliance checks and
built-in error checks to avoid duplication and reduce data-entry errors.
The State further reported that it collected discipline data from its
Safe Schools Division, utilizing an aggregated form of collection via a
spreadsheet, and collected personnel data directly from agencies via a
spreadsheet, and that it has a high level of confidence in the accuracy
and timeliness of these data. OSEP appreciates the State's efforts in
this area, and looks forward to reviewing data and information
demonstrating continued improvement in this area in the SPP.

> [Other: Provision of FAPE in local adult correctional
> facilities]{.underline}

On page 12 of the FFY 2003 APR, the State included data and information
indicating continued noncompliance related to the provision of FAPE to
youth with disabilities incarcerated in local adult correctional
facilities (34 CFR §§300.121 and 300.311). OSEP's October 2004 letter
directed the State to submit: (1) as part of its FFY 2003 APR, an
update, including current supporting data and analysis, regarding its
progress in correcting the noncompliance; and (2) by July 9, 2005,
documentation showing that the State corrected the noncompliance. While
the State's July 2005 Progress Report showed progress, it also
demonstrated that noncompliance persisted in this area.

In the Progress Report, the State reported that: (1) 22 school districts
submitted self-assessments in February 2005; (2) of those 22, 18
reported having procedures in place for providing services to students
incarcerated in the local jails; and (3) two of those 18 indicated that
they had made attempts to provide services but school personnel were
denied access because of safety issues.

Not later than 60 days from the date of this letter, the State must
provide documentation that it has ensured correction of the
noncompliance, including documentation that the school districts that
did not have procedures in place for provision of services to students
incarcerated in local jails, are complying with the requirements of 34
CFR §§300.121 and 300.311.

# *Early Childhood Transition*

On page 20 of the APR, the State reported that, "Ninety-eight percent of
children who transition from Part C and are eligible for Part B services
have an IEP and appropriate services in place by their third birthday."
The State included future activities, timelines and resources to improve
performance and compliance. OSEP looks forward to reviewing data and
analysis in the SPP showing full compliance.

# *Parent Involvement*

On page 24 of the FFY 2003 APR, the State included data and analysis
demonstrating continued performance. For example, the State reported on
page 25 that: "The data supports what each LEA and charter school has
reported in their Self-Assessments that there is a high level of
satisfaction among parents in their systems." The APR included future
activities with timelines and resources to meet projected targets in
maintaining performance in this area. The SPP instructions establish a
new indicator in this area, for which States must provide baseline data
in the FFY 2005 APR due February 1, 2007. The State should carefully
review the instructions to the SPP in developing its plans for this
collection.

***Free Appropriate Public Education (FAPE) in the Least Restrictive
Environment (LRE)***

[Disproportionality]{.underline}

Regulations at 34 CFR §300.755(b) require that when a State determines
that there is significant disproportionality regarding the
identification or educational placement of children with disabilities,
the State must provide for the review and, if appropriate, revision of
the policies, procedures, and practices used in identification or
placement to ensure that the policies, procedures, and practices comply
with the requirements of Part B.

OSEP's October 2004 letter instructed NCDPI to report, in the FFY 2003
APR, the results of the review of policies, procedures and practices
related to disproporitionality. On page 33 of the FFY 2003, the State
reported that, through a review of identification data in six regions,
it determined that some regions were more at risk of identifying
African-American children in the area of mental disabilities (MD). The
State further reported that some LEAs in all regions were more likely to
identify African-American children as having behavioral-emotional
disabilities (BED).

On page 34 of the FFY 2003 APR, the State included a target that: "North
Carolina will continue to review data at the LEA level to determine if
significant disproportionality in identification and placement is
occurring. If so, a review and, as appropriate, a revision of policies,
procedures and practices will be conducted." However, the State did not
provide the results of the review of policies, procedures and practices
used in the identification and placement of children with disabilities
to ensure that they were consistent with the requirements of Part B and
were race neutral, for those districts with data that illustrated
significant disproportionality in the identification of children in
specific disability categories in particular educational settings.

Not later than 60 days from the date of this letter, the State must
either: (1) provide: (a) documentation that it ensured the review of
policies, procedures, and practices used in the identification and
placement of children with disabilities to ensure consistency with the
requirements of Part B and are race-neutral, for those districts with
data showing significant disproportionality in the identification of
children as disabled and in specific disability categories and the
placement of children in particular educational settings, as required by
34 CFR §300.755; and (b) the results of such review; or (2) specify what
steps the State will take to implement its plan to report on the results
of its review of policies, procedures, and practices, as outlined above,
and to ensure correction of the noncompliance as soon as possible, not
to exceed one year from the date of this letter.

The SPP instructions establish two new indicators in this area (#9 and
#10), for which States must provide baseline data in the FFY 2005 APR,
due February 1, 2007. Absence of this information at that time will be
considered in OSEP's annual determination on the status of the State's
performance and compliance required under §616(d) of the IDEA. The State
should carefully review the instructions to the SPP in developing its
plans for this collection. OSEP looks forward to reviewing the State's
plan for collection of this data, in the SPP.

[Graduation and drop-out rates]{.underline}

On page 42 of the FFY 2003 APR, the State included information
indicating that North Carolina's high school graduation rates for
children with disabilities were comparable among LEAs to graduation
rates for students without disabilities. For the 2002-2003 school year,
91 percent of high school graduates were nondisabled and eight percent
were students with disabilities. The State further reported that for
2003-2004 school year, 91 percent of students who graduated were
nondisabled and 9 percent were students with disabilities. The State's
data represented an increase in the number of students who graduated
with a regular high school diploma during the 2003-2004 school year, and
a decrease in the number of students who received certificates in the
2002-2003 and 2003-2004 school year. The FFY 2003 APR included future
activities, timelines and resources to achieve projected targets and
results. OSEP appreciates the State's efforts in this area and looks
forward to reviewing data and information demonstrating continued
improvement in this area in the SPP.

On page 46 of the FFY 2003 APR, the State reported that 3.23 percent of
all students in grades 7-12 dropped out during the 2002-2003 school
year. Of those students, the State reported that 84 percent were
nondisabled students and 16 percent were student with disabilities.
During the 2003-2004 school year, the percentage of students with
disabilities dropping out of school increased to 19 percent. The FFY
2003 APR included future activities, timelines and resources to achieve
projected targets and results. OSEP appreciates the State's efforts in
this area and looks forward to reviewing data and information
demonstrating continued improvement in this area in the SPP.

######### Suspension and expulsion

On pages 48 through 50 of the FFY 2003 APR, the State included data and
analysis indicating a need to improve performance in the area of
suspension and expulsion rates of children with disabilities. On page 48
of the FFY 2003 APR, the State reported that: "The total number of acts
reported increased to 9,800 in 2003-04 from 8,548 in 2002-03...Of the
9,800 acts reported, there were 2,341 children identified as having a
disability. In the 2003-04 school year, the number of acts for children
with disabilities increased from the 2002-03 school year by 329 acts (9
percent)." On page 49, the State reported the results of the 2002-2003
annual study of short and long-term suspensions and expulsions for all
public school children. Results of the study showed an increase of 7
percent for short-term suspensions, and an increase of 14 percent for
long-term suspensions over the 2001-2002 school year. The results of the
study further showed that male children (particularly African-American
males), Native-American children, and children with disabilities in
grades 6-9 continue to be disproportionality represented among
short-term and long-term suspended children.

34 CFR §300.146 requires that States examine data to determine if
significant discrepancies are occurring in the rates of long-term
suspensions and expulsions of children with disabilities either among
LEAs in the State or compared to the rates for nondisabled children
within the agencies. Where the State determines that significant
discrepancies are occurring, it must review and, if appropriate, revise
(or require the affected LEA to revise) its policies, procedures, and
practices related to the development and implementation of IEPs, the use
of behavioral interventions, and procedural safeguards to ensure that
policies, procedures practices comply with Part B. The instructions to
the 2003 APR direct States to describe which of these comparisons it
did, as well as the method the State used to determine possible
discrepancies, what constitutes a discrepancy, the number of agencies
with significant discrepancies, and, if significant discrepancies are
occurring, a description of those discrepancies and how the State plans
to address them. The State's FFY 2003 APR, however, did not include any
information indicating that the State examined data from the LEAs that
it used in assembling the State-level data to determine whether
significant discrepancies were occurring in the LEAs based on either one
of the comparisons described above, as directed by the FFY 2003 APR
instructions. Not later than 60 days from the date of this letter, the
State must submit to OSEP either: (1) evidence that it is complying with
the requirements of 34 CFR §300.146, as described above; or (2) a plan,
including strategies, proposed evidence of change, targets and timelines
designed to ensure correction of the noncompliance as soon as possible
and not more than one year after OSEP accepts the plan. If the State
submits a plan, no later than six months from the date of this letter,
the State must submit a Progress Report including data and analysis
demonstrating progress toward compliance, and provide a report to OSEP,
with data and analysis demonstrating compliance, as soon as possible,
but not later than 30 days following the end of the one year timeline.

[Statewide and districtwide assessments]{.underline}

As part of its July 2005 visit, OSEP reviewed the State's procedures for
statewide and districtwide assessments. As reported in OSEP's letter on
the 2005 verification visit, OSEP determined, through its review of the
State's written procedures for [statewide]{.underline} assessments and
the State's reports to the public and the Secretary on the participation
and performance of children with disabilities on such assessments, that
those procedures, as written, and those reports were consistent with
Part B requirements.

On pages 53-56 and 60-64 of the FFY 2003 APR, NCDPI reported
participation and performance results for children with disabilities in
statewide assessments. NCDPI required all children, with and without
disabilities, to participate in the assessment program in grades 3-8 and
10 for reading and math, and in high school courses where an
end-of-course test is required. Other than some children who were absent
(the largest number in the 10^th^ grade), it appeared that all children
with disabilities took the regular assessment, with or without
accommodations, or the alternate assessment.

On page 53 of the FFY 2003 APR, NCDPI reported that, "during the 1998-99
through 2002-03, North Carolina schools made great progress in closing
the achievement gap." On page 54, NCDPI reported that the following: (1)
the percent of children, at or above achievement level III (there are
four achievement levels) in reading and math in 2002-2003 ranged from 16
percent in grade 10 to 57 percent in grade five for children with
disabilities and from 62 percent in grade 10 to 90 percent in grade 5
for children without disabilities; (2) in 2003-2004, ranged from 18
percent in grade 10 to 48 percent in grade 5 for children with
disabilities and from 64 percent in grade 10 to 91 percent in grade 5
for children without disabilities; (3) for children in alternate
assessments, in 2002-2003, the percent was "greater than 5," and in
2003-2004, ranged from 13 percent in grade 3 to 33 percent in grade 8;
and (4) for children in portfolio assessments, in 2002-2003, ranged from
36 percent in grade 10 to 41 percent in grade 4 and, for 2003-2004,
ranged from 48 percent in grade 10 to 66 percent in grade 5. The data
showed that the percent of children scoring at level III or above was at
its highest, for most children with and without disabilities, in grade 5
and the lowest, for most children with and without disabilities, in
grade 10. The average percents of children, scoring at or above level
III, on the regular assessment were: (1) for 2002-2003, 42.7 percent for
children with disabilities and 82.3 percent for children without
disabilities; and (2) for 2003-2004, 42.1 percent for children with
disabilities and 83.1 percent for children without disabilities.

As also noted in OSEP's October 2005 verification letter, OSEP found
that NCDPI did not ensure compliance with the requirements of 34 CFR
§§300.138, 300.139, and 300.347(a)(5) as they apply to
[districtwide]{.underline} assessments. The basis for that finding, and
the actions that the State to correct the noncompliance, are set forth
in that letter.

> [Least restrictive environment (LRE)]{.underline}

On page 51 of the FFY 2003 APR, NDCPI reported that, in the 2002-2003
school year: (1) 100,484 of 170,568 children with disabilities were
educated with their nondisabled peers more than 80 percent of the day;
(2) 36,290 were educated with nondisabled peers 40-80 percent of the
day; and (3) 30,190 were educated with nondisabled peers less than 40
percent of the day. In 2003-2004: (1) 103,097 of 172,950 were educated
with their nondisabled peers more than 80 percent of the school day; (2)
35,466 were educated with nondisabled peers 40-80 percent of the day;
and (3) 30,304 were educated with nondisabled peers less than 40 percent
of the school day. These data show progress from 2002-2003 to 2003-2004.

On page 51 of the FFY 2003 APR, NDCPI reported that, in the 2002-2003
school year, 13,018 of 19,921 preschool children with disabilities were
educated with their nondisabled peers in an early childhood setting, and
3,062 were educated with nondisabled peers in an early childhood special
education setting. In 2003-2004, 13,409 of 21,018 were educated with
their nondisabled peers in an early childhood setting; and 3,009 were
educated with nondisabled peers in an early childhood special education
setting.

Regulations at 34 CFR §300.550(b) require that each public agency
ensure: (1) that to the maximum extent appropriate, children with
disabilities, including children in public or private institutions or
other care facilities, are educated with children who are nondisabled;
and (2) that special classes, separate schooling or other removal of
children with disabilities from the regular educational environment
occurs only if the nature or severity of the disability is such that
education in regular classes with the use of supplementary aids and
services cannot be achieved satisfactorily. On page 51 of the FFY 2003
APR, the State reported that, as determined through LEAs'
self-assessments in 2002-2003 and 2003-2004, "several LEAs were involved
in non-compliance with LRE in the 6-21 age group" for both of those
school years. The State did not include any data regarding its
effectiveness in ensuring that this noncompliance was corrected within
one year from identification. Not later than 60 days from the date of
this letter, the State must provide data and analysis regarding the
extent to which it has been effective in ensuring that LEAs correct
noncompliance with Part B's LRE requirements within one year from
identification.

> [Preschool performance outcomes]{.underline}

Under the Government Performance and Results Act of 1993, 31 U.S.C.
1116, the effectiveness of the IDEA section 619 program is being
measured based on the extent to which early language/ communication,
pre-reading, and social-emotional skills of preschool children with
disabilities receiving special education and related services are
improving. On page 56 of the FFY 2003 APR, the State included, as its
target for the 2005-2006 school year, that, "There will be a plan to
obtain outcome data that will reflect the improvement of early
language/communication, pre-reading, and social-emotional skills of
preschool children with disabilities receiving special education and
related services." The SPP instructions establish a new indicator in
this area, for which States must provide entry data in the FFY 2005 APR
due February 1, 2007. Absence of this information at that time will be
considered in OSEP's annual determination on the status of the State's
performance and compliance required under section 616(d) of the IDEA.
The State should carefully review the instructions to the SPP in
developing its plans for this collection. OSEP looks forward to
reviewing the State\'s plan for collecting this data, in the SPP.

[Other: FAPE for children with behavioral issues]{.underline}

OSEP's October 2004 letter directed the State to submit: (1) as part of
its FFY 2003 APR, an update, including current supporting data and
analysis, regarding its progress in correcting the noncompliance related
to the provision of FAPE to children with disabilities with behavioral
issues (34 CFR §300.300); and (2) by July 9, 2005, documentation showing
that the State corrected the noncompliance. Neither the FFY 2003 APR nor
the State's July 2005 Progress Report included documentation that the
State corrected this area of noncompliance. To address this area of
noncompliance, the Progress Report referenced the Personnel indicator in
the State's FFY 2003 APR, in which the State included data regarding its
progress in ensuring an adequate supply of fully certified personnel to
serve all children with disabilities. The State did not include, in
either the FFY 2003 APR or the Progress Report, any monitoring or other
data regarding the extent to which the State is ensuring that eligible
children with behavioral issues receive FAPE. Not later than 60 days
from the date of this letter, the State must provide documentation that
it ensured full correction of the noncompliance.

***Secondary Transition***

OSEP's October 2004 letter directed the State to submit: (1) as part of
its FFY 2003 APR, an update, including current supporting data and
analysis, regarding its progress in correcting the noncompliance related
to inviting students to IEP meetings where a purpose is the
consideration of transition service needs or needed transition services
(34 CFR §300.344(b)(1)) and transition-related content of IEPs (34 CFR
§300.347(b)); and (2) by July 9, 2005, documentation showing that the
State corrected both areas of noncompliance.

On pages 65 through 68 of the FFY 2003 APR, the State included data and
information regarding its monitoring findings related to those
requirements. Those data showed that the State continued to find some
LEAs in noncompliance in both areas.[^2] Neither the APR nor the July
2005 Progress Report included documentation regarding the extent to
which the State was effective in ensuring that these LEAs corrected that
noncompliance within one year from identification.

Not later than 60 days from the date of this letter, the State must
provide data and analysis regarding the extent to which it has been
effective in ensuring that LEAs correct the noncompliance within one
year from identification.

The SPP instructions establish two new indicators in this area (# 13 and
#14), for which States must provide baseline data in the FFY 2005 APR,
due February 1, 2007 (#13) and the FFY 2006 APR, due February 1, 2008
(#14). Absence of this information at that time will be considered in
OSEP's annual determination on the status of the State's performance and
compliance required under §616(d) of the IDEA. The State should
carefully review the instructions to the SPP in developing its plans for
this collection. OSEP looks forward to reviewing the State's plan for
collecting this data, in the SPP.

*Conclusion*

As noted above, the State must, not later than 60 days from the date of
this letter:

1.  Submit updated data on its compliance with the requirements of 34
    CFR §300.511(a) and (c), and, to the extent that the State cannot
    demonstrate compliance with those requirements, specific strategies
    that the State will implement to ensure such compliance as soon as
    possible, including strategies to ensure that any extension of the
    timeline for the decision in a special education due process hearing
    is made at the request of a party and the new due date for the
    decision is documented in writing.

2.  Either: (1) provide: (a) documentation that it ensured the review of
    policies, procedures, and practices used in the identification and
    placement of students with disabilities to ensure that they are
    consistent with the requirements of Part B and are race-neutral, for
    those districts with data showing significant disproportionality in
    the identification of children as disabled and in specific
    disability categories and the placement of children in particular
    educaitonal settings, as required by 34 CFR §300.755; and (b) the
    results of such review; or (2) specify what steps the State will
    take to implement its plan to report on the results of its review of
    policies, procedures, and practices, as outlined above, and to
    ensure correction of the noncompliance as son as possible, not to
    exceed one year from the date of this letter.

3.  Submit either: (1) evidence that it is complying with the
    requirements of 34 CFR §300.146, as described above, or (2) a plan,
    including strategies, proposed evidence of change, targets and
    timelines designed to ensure correction of the noncompliance as soon
    as possible and not more than one year after OSEP accepts the plan.
    If the State submits a plan, no later than six months from the date
    of this letter, the State must submit a Progress Report including
    data and analysis demonstrating progress toward compliance, and
    provide a report to OSEP, with data and analysis demonstrating
    compliance, as soon as possible, but not later than 30 days
    following the end of the one year timeline.

4.  Provide documentation that it has ensured correction of the
    noncompliance related to: (1) the provision of FAPE to youth with
    disabilities incarcerated in local adult correctional facilities (34
    CFR §§300.121 and 300.311); and (2) the noncompliance related to the
    provision of FAPE to children with disabilities with behavioral
    issues, including documentation that the school districts that did
    not have procedures in place for provision of services to students
    incarcerated in local jails, are complying with the requirements of
    34 CFR §§300.121 and 300.311.

5.  Provide data and analysis regarding the extent to which it has been
    effective in ensuring that LEAs correct, within one year from
    identification, noncompliance with Part B's LRE requirements and
    secondary transition requirements.

6.  Documentation that the State ensured full correction of the
    noncompliance regarding ensuring that eligible children with
    behavioral issues receive FAPE.

7.  Data and analysis regarding the extent to which it has been
    effective in ensuring that LEAs correct noncompliance with the
    requirements of 34 CFR §300.344(b)(1)) and 34 CFR §300.347(b) within
    one year from identification.

IDEA 2004 §616, requires each State to submit a State Performance Plan
(SPP) that measures performance on monitoring priorities and indicators
established by the Department. These priorities and indicators are, for
the most part, the same as clusters and probes in the APR. OSEP
encourages the State to carefully consider the comments in this letter
as it prepares its SPP, due December 2, 2005.

OSEP recognizes that the APR and its related activities represent only a
portion of the work in your State and looks forward to collaborating
with you as you continue to improve results for children and youth with
disabilities and their families. If you have questions, please contact
Ms. Delores Barber at (202) 245-7263.

> Sincerely,
>
> /s /Troy R. Justesen
>
> Troy R. Justesen
>
> Acting Director
>
> Office of Special Education Programs

cc: Mary N. Watson

[^1]: The State also provided documentation that it was in compliance
    with the timeline requirements, at 34 CFR §300.511(b) and (c), for
    review decisions.

[^2]: **Inviting students to IEP meetings where transition discussed.**
    According to baseline data and information on pages 65 and 66 of the
    APR: (1) the five LEAs and eleven charter schools that submitted
    self-assessments in 2003-2004 showed a 74% internal record review
    rate on this requirement; and (3) in its on-site record review in 11
    agencies in 2003-2004, NCDPI found seven (71%) in compliance with
    this requirement.

    **Transition-Related Content of IEPs.** Data on pages 65 through 68
    showed that: (1) the five LEAs and 11 charter schools that submitted
    self-assessments in 2003-2004 showed a 79% internal record review
    rate on these requirements; and (3) in its on-site record review in
    11 agencies in 2003-04, NCDPI found eight (73%) in compliance with
    these requirements.