OSEP Policy Support 21-02

U.S. DEPARTMENT OF EDUCATION FACT SHEET

Section 2014 of the American Rescue Plan Act of 2021 and the 

Individuals with Disabilities Education Act 

Part B and Part C of the Individuals with Disabilities Education Act (IDEA) authorize assistance to States to support the provision of 

special education and related services to children with disabilities and the provision and coordination of early intervention services for 

infants and toddlers with disabilities and their families, respectively. Section 2014(a) of the American Rescue Plan Act of 2021 (ARP) 

provided more than $3 billion in supplemental funding for Fiscal Year 2021 for the three IDEA formula grant programs described 

below: 

• $2,580,000,000 for IDEA Part B Grants to States (Section 611)

• $200,000,000 for IDEA Part B Preschool Grants (Section 619)

• $250,000,000 for IDEA Part C Grants for Infants and Families

This document provides an overview of the major statutory and regulatory requirements for IDEA Part B and Part C. Supplemental 

funding made available by the ARP is subject to the same requirements as Federal fiscal year (FFY) 2021 IDEA funding made 

available under Public Law 116-260 (The Consolidated Appropriations Act of 2021). 

Part B of the IDEA provides funds to eligible States and entities under the Grants to States program authorized by section 611 of 

IDEA for children with disabilities aged three through 21 and the Preschool Grants program authorized by section 619 of IDEA for 

children with disabilities aged three through five. The IDEA Part B funds assist States, and through them, eligible local educational 

agencies (LEAs), in providing special education and related services to children with disabilities. Part B funds are awarded to each 

State educational agency (SEA) that has established its eligibility under section 612 of IDEA for IDEA Part B funds to assist in 

providing special education and related services to eligible children with disabilities.1

. States are required to distribute any IDEA 

section 611 and section 619 funds that the State does not reserve for State-level activities2 to LEAs that have established their 

eligibility under section 613 of IDEA under a statutory formula and must be used only to pay the excess costs of providing special 

education and related services in accordance with part B of IDEA.3

 All IDEA Part B ARP funds must be used consistently with the 

current IDEA Part B statutory and regulatory requirements. 

1 See also 34 C.F.R. § 300.100. 2 States are limited in the amount they may reserve for State-level activities by the formula in 34 C.F.R. § 300.704. 3 34 C.F.R. §§ 300.705(a) and 300.815; see also 34 C.F.R. § 300.202(a)(2). 
Part C of the IDEA provides funds to each State lead agency designated by the Governor to implement statewide systems of 

coordinated, comprehensive, multidisciplinary, interagency programs to make early intervention services available to infants and 

toddlers with disabilities and their families. All IDEA Part C ARP funds must be used consistently with the current IDEA Part C 

statutory and regulatory requirements. IDEA Part C ARP funds may be used for any allowable purpose under Part C of the IDEA, 

including the direct provision of early intervention services to infants and toddlers with disabilities and their families, and 

implementing a statewide, comprehensive, coordinated, multidisciplinary, interagency system to provide early intervention services.

Under Public Law 116-260, (The Consolidated Appropriations Act of 2021) States may use IDEA Part C FFY 2021 and IDEA Part C 

ARP funds allotted under section 643(c) of the IDEA to make subgrants to LEAs, institutions of higher education, other public 

agencies, and private non-profit organizations to carry out activities authorized by section 638 of the IDEA. States may also apply for 

state incentive grants (SIGs) to fund the Part C extension option under IDEA sections 635(c) and 643(e) and 34 C.F.R. §§ 303.211 and 

303.734.

The additional IDEA Part B and Part C funds that section 2014 of the ARP made available for States, in addition to State IDEA Part B 

and Part C formula grant awards for Federal fiscal year (FFY) 2021, are subject to all IDEA statutory requirements reflected in 20 

U.S.C. 1401 et seq. and applicable regulatory requirements in 34 CFR Parts 300 and 303. These statutory and regulatory provisions 

apply to IDEA grant awards, and include requirements and provisions under IDEA, the Education Department General Administrative 

Regulations (EDGAR), applicable provisions of the General Education Provisions Act (GEPA), and the Office of Management and 

Budget’s (OMB) Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform 

Guidance). State allocation summary tables for FFY 2021 IDEA Part B and Part C grant awards (including both the regular formula 

grant funds and the supplemental IDEA grant funds provided under section 2014 of the ARP) are available on the IDEA ARP page in 

the linked locations.

The table below describes major statutory and regulatory requirements of IDEA Part B and C. These requirements apply equally to 

funds made available under the ARP and the Consolidated Appropriations Act of 2021. The table below is intended to highlight key 

topics with links to statutory and regulatory text, but is not a comprehensive list of all requirements.

Topic IDEA Part B, Sections 611 and 619 IDEA Part C

Authorizing Statutes Section 611 and section 619 of the IDEA 

(for the IDEA Part B FFY 2021 formula 

grant funds), and section 2014 of the ARP 

(for the supplemental IDEA section 611 

and section 619 funds).

Section 643 of the IDEA (for the IDEA 

Part C FFY 2021 IDEA formula grant 

funds, and section 2014 of the ARP (for 

the supplemental IDEA Part C funds).
Topic IDEA Part B, Sections 611 and 619 IDEA Part C

Amount of IDEA regular FFY 2021 

funds (not including ARP)

$12,937,457,000 for IDEA section 611

$397,620,000 for IDEA section 619.

$477,000,000 for IDEA Part C.

Amount of IDEA funds awarded in 

ARP

$2,580,000,000 for IDEA section 611

$200,000,000 for IDEA section 619.

$250,000,000 for IDEA Part C.

Period of Funds Availability Funds are available for obligation by 

SEAs and LEAs between July 1, 2021,

and September 30, 2023, and must be 

liquidated by January 28, 2024.

Funds are available for obligation by Part 

C lead agencies between July 1, 2021, and 

September 30, 2023, and must be 

liquidated by January 28, 2024.

Reservation of IDEA funds for State 

administration and other State-level 

activities

IDEA allows States to reserve funds for 

State level activities (State administration 

and other State-level activities) for both 

sections 611 and 619. However, because 

the provisions governing the maximum 

amount of funds that may be reserved are 

slightly different for section 611 and 

section 619, the impact of the additional 

ARP funds is different. 

For section 611, the amounts that States 

may reserve for State administration and 

other State-level activities are set in 

accordance with section 611(e) of the 

IDEA. Under these provisions the 

maximum amount that a State may 

reserve is subject to rate of inflation and 

not the total amount of IDEA funds made 

available. As a result, the additional IDEA

funds made available by ARP do not 

increase the amount that can be reserved 

N/A
Topic IDEA Part B, Sections 611 and 619 IDEA Part C

for State administration and other State 

level activities.

For section 619, the amounts that States 

may reserve for State administration and 

other State-level activities are set in 

accordance with section 619(d) of the 

IDEA. Under these provisions the 

maximum amount that a State may 

reserve is determined by the lesser of (1) 

the increase in the State’s allocation under 

the program, or (2) the rate of inflation.

As a result of the additional ARP Act 

funding, there was a small increase in the 

amount that States may reserve compared 

to FFY 2020.

LEA allocations Under section 611(f) of the IDEA and 34 

C.F.R. § 300.705(a), each State that 

receives a section 611 grant for any fiscal 

year shall distribute any section 611 funds 

the State does not reserve for State-level 

activities to LEAs (including public 

charter schools that operate as LEAs) in 

the State that have established their 

eligibility under section 613 of the IDEA, 

in accordance with the formula in section 

611(f)(2).

Likewise, under section 619(g) of the 

IDEA and 34 C.F.R. § 300.815, each State 

that receives a section 619 grant for any 

fiscal year shall distribute all of the 

N/A
Topic IDEA Part B, Sections 611 and 619 IDEA Part C

section 619 grant funds that the State does 

not reserve for State-level activities to 

LEAs in the State (including public 

charter schools that operate as LEAs) in 

the State that have established their 

eligibility under section 613 of the IDEA, 

in accordance with the formula in section 

619(g)(1)(A) and (B).

Cash Management For the IDEA section 611 program, cash 

management principles apply and IDEA 

funds are usually included in the 

Treasury-State agreement. 31 C.F.R. Part

205, Subpart A. IDEA subgrants are 

subject to the OMB Uniform Guidance 

payment requirements in 2 C.F.R 

§ 200.305(b).

For the IDEA section 619 program, cash 

management principles in 31 C.F.R. Part

205 Subpart B (rules applicable to Federal 

assistance programs not included in a 

Treasury-State agreement) apply.

Cash management principles in 31 C.F.R.

Part 205 Subpart B (rules applicable to 

Federal assistance programs not included 

in a Treasury-State agreement) apply. 

Uses of Funds Funds may be used for all allowable 

purposes under Part B of IDEA and are 

subject to all requirements and provisions 

that apply to IDEA funds, including 

requirements and provisions under IDEA, 

EDGAR, and the OMB Uniform 

Guidance.

Funds may be used for all allowable 

purposes under Part C of IDEA and are 

subject to all requirements and provisions 

that apply to IDEA funds, including 

requirements under IDEA, EDGAR, and 

the OMB Uniform Guidance.
Topic IDEA Part B, Sections 611 and 619 IDEA Part C

Prior Approvals (for selected items of 

cost)

Under section 605 of the IDEA, if the 

Secretary determines that a program 

authorized under IDEA Part B will be 

improved by permitting program funds to 

be used to acquire appropriate equipment, 

or to construct new facilities or alter 

existing facilities, the Secretary is 

authorized to allow the use of those funds 

for those purposes.

Note that SEAs will continue to have the 

authority, as the pass-through entity, to 

review and approve LEA requests to use 

IDEA Part B funds for the purchase of 

equipment, including the alteration of 

existing facilities. 2 C.F.R. § 200.439(b) 

(1)–(3).

States may also wish to review the 

October 2019 Frequently Asked 

Questions (2019 FAQs) Prior Approval –

OSEP and RSA Formula Grants, which 

provides prior approval flexibilities for 

certain equipment and participant support 

costs.

Under section 605 of the IDEA, if the 

Secretary determines that a program 

authorized under IDEA Part C will be 

improved by permitting program funds to 

be used to acquire appropriate equipment, 

or to construct new facilities or alter 

existing facilities, the Secretary is 

authorized to allow the use of those funds 

for those purposes.

States may also wish to review the 

October 2019 Frequently Asked 

Questions (2019 FAQs) Prior Approval –

OSEP and RSA Formula Grants, which 

provides prior approval flexibilities for 

certain equipment and participant support 

costs.

Maintenance of State Financial Support 

(MFS)/Maintenance of Effort (MOE) 

(State)

Under section 612(a)(18) of the IDEA, a 

State may not reduce the amount of State 

financial support for special education and 

related services for children with 

disabilities, or otherwise made available 

because of the excess costs of educating 

Section 637(b)(5)(B) of the IDEA

includes a supplement not supplant 

provision, implemented through the Part 

C regulations at 34 C.F.R. § 303.225. The 

IDEA Part C MOE provision in 34 C.F.R. 

§ 303.225(b) requires each State to ensure 

that the total amount of State and local 
Topic IDEA Part B, Sections 611 and 619 IDEA Part C

those children, below the amount of that 

support for the preceding fiscal year.

Under section 612(a)(18)(C) of the IDEA, 

the Department is authorized to waive the 

MFS requirement for a State, for one 

fiscal year at a time, if the Department 

determines that doing so would be 

equitable due to an exceptional or 

uncontrollable circumstance, such as a 

natural disaster or a precipitous and 

unforeseen decline in the financial 

resources of the State.

funds budgeted for expenditures in the 

current fiscal year for early intervention 

services for children eligible under this 

part and their families must be at least 

equal to the total amount of State and 

local funds actually expended for early 

intervention services for these children 

and their families in the most recent 

preceding fiscal year for which the 

information is available. States must meet 

this standard to be eligible for the receipt 

of Federal IDEA Part C funds. 

Part C MOE Allowances N/A Allowances to the requirements in 34 

C.F.R. § 303.225(b) may be made for:

1. A decrease in the number of infants 

and toddlers who are eligible to 

receive early intervention services 

under this part; and

2. Unusually large amounts of funds 

expended for such long-term purposes 

as the acquisition of equipment and 

the construction of facilities.

Maintenance of Effort (LEA) Under section 613(a)(2)(A)(iii) of the 

IDEA, an LEA may not reduce the level 

of expenditures for the education of 

children with disabilities made by the 

LEA from local funds below the level of 

those expenditures for the preceding fiscal 

year.

N/A
Topic IDEA Part B, Sections 611 and 619 IDEA Part C

LEA MOE Exceptions Under section 613(a)(2)(B) of the IDEA

and 34 C.F.R. § 300.204, there are five 

instances where an LEA may reduce the 

level of expenditures for the education of 

children with disabilities made by the 

LEA below the level of those 

expenditures for the preceding fiscal year 

(for the compliance standard), and below 

the level of those expenditures for the 

most recent fiscal year for which 

information is available (for the eligibility 

standard). They are: 

(1) The voluntary departure, by retirement 

or otherwise, or departure for just 

cause, of special education or related 

services personnel (e.g., special 

education teachers, speech 

pathologists, paraprofessionals 

assigned to work with children with 

disabilities); 

(2) A decrease in the enrollment of 

children with disabilities; 

(3) The termination of the obligation of 

the agency, consistent with IDEA Part 

B, to provide a program of special 

education to a particular child with a 

disability that is an exceptionally 

costly program, as determined by the 

SEA, because the child—

N/A
Topic IDEA Part B, Sections 611 and 619 IDEA Part C

(a) Has left the jurisdiction of the 

agency; 

(b) Has reached the age at which the 

obligation of the agency to provide 

FAPE to the child has terminated; 

or 

(c) No longer needs the program of 

special education;

(4) The termination of costly expenditures 

for long-term purchases, such as the 

acquisition of equipment or the 

construction of school facilities; and

(5) The assumption of cost by the high 

cost fund operated by the SEA under 

34 C.F.R. § 300.704(c).

Adjustment to Local Effort Under section 613(a)(2)(C) of the IDEA, 

for any fiscal year that an LEA’s IDEA 

allocation exceeds the amount the LEA 

received for the previous fiscal year, 

under certain circumstances, the LEA may 

reduce the level of local, or State and 

local, expenditures otherwise required to 

meet MOE by up to 50 percent of the 

amount of the excess, as long as the LEA 

uses the freed-up local funds for activities 

that could be supported under the ESEA. 

Note that an LEA may not take this 

reduction if the SEA determines that the 
Topic IDEA Part B, Sections 611 and 619 IDEA Part C

LEA is unable to establish and maintain 

programs of free appropriate public 

education for eligible children with 

disabilities or the SEA has taken action 

against the LEA under section 616 of 

IDEA. Also, an LEA that is required to 

reserve the maximum 15 percent of its 

IDEA Part B allocation on 

Comprehensive Coordinated Early 

Intervention Services (CCEIS) because 

the LEA is identified with significant 

disproportionality under 34 C.F.R. § 300.646 will not be able to take 

advantage of the MOE reduction in 34 

C.F.R. § 300.205(a).

In addition, under IDEA section 616(f), if 

in making its annual determinations, an 

SEA determines that an LEA is not 

meeting the requirements of Part B, 

including meeting targets in the State’s 

performance plan, the SEA must prohibit 

that LEA from reducing its MOE under 

IDEA section 613(a)(2)(C) for any fiscal 

year. Therefore, an SEA must prohibit an 

LEA from taking advantage of the MOE 

reduction under IDEA section 

613(a)(2)(C) if the LEA’s determination is 

Needs Assistance, Needs Intervention, or 

Needs Substantial Intervention.
Topic IDEA Part B, Sections 611 and 619 IDEA Part C

Part C Option Under the reservation for State incentive 

grants in section 643((e) of the IDEA, for 

any fiscal year for which the amount 

appropriated pursuant to the authorization 

of appropriations under section 644 of this 

title exceeds $460,000,000, the Secretary 

shall reserve 15 percent of such 

appropriated amount to provide grants to 

States that are carrying out the policy 

described in section 635(c) of this title in 

order to facilitate the implementation of 

such policy.

Equitable Services Reservations Under section 612(a)(10)(A)(i) of the 

IDEA, to the extent consistent with the 

number and location of children with 

disabilities in the State who are enrolled 

by their parents in private elementary 

schools and secondary schools in the 

school district served by an LEA, 

provision is made for the participation of 

those children in the program assisted or 

carried out under Part B by providing for 

such children special education and 

related services in accordance with the 

equitable services requirements in IDEA. 

34 C.F.R. §§ 300.130-300.144. Amounts 

to be expended for the provision of those 

services (including direct services to 

parentally placed private school children) 

by the LEA shall be equal to a 

proportionate amount of Federal funds 

N/A
Topic IDEA Part B, Sections 611 and 619 IDEA Part C

made available under Part B of the IDEA.

In calculating the proportionate share 

required under IDEA section 

612(a)(10)(A)(i)(I), an LEA must first 

aggregate the FFY 2021 funds received 

under the section 611 (Grants to States)

regular and ARP awards and apply the 

formula outlined in 34 C.F.R. § 300.133 

for calculating the proportionate share to 

the aggregated amount. Similarly, for 

children aged 3-5, the proportionate share 

is based on the total FFY 2021 funds 

received under the section 619 (Preschool 

Grants) regular and ARP awards.

Indirect Cost Rates Indirect costs are restricted. Under 34 

C.F.R § 76.563 of EDGAR, 34 C.F.R. 

§§ 76.564 through 76.569 apply to 

agencies of State and local governments 

that are grantees under programs with a 

statutory requirement prohibiting the use 

of Federal funds to supplant non-Federal 

funds, and to their subgrantees under these 

programs.

Indirect cost rates are approved by the 

Secretary pursuant to 34 C.F.R. § 76.561.

Restricted indirect cost rates apply to the 

IDEA Part B regular formula grant funds

and supplemental funds provided by the 

ARP. States should calculate their 

restricted indirect costs on the IDEA Part 

Indirect costs are restricted. Under 34 

C.F.R § 76.563 of EDGAR, 34 C.F.R.

§ 76.564 through 76.569 apply to agencies 

of State and local governments that are 

grantees under programs with a statutory 

requirement prohibiting the use of Federal 

funds to supplant non-Federal funds, and 

to their subgrantees under these programs. 

Under 34 C.F.R. § 303.225(c), State may 

not charge indirect costs to IDEA Part C 

FFY 2021 formula funds as well as ARP 

supplemental IDEA Part C funds unless 

they are charged on a restricted basis.

States should calculate their restricted 

indirect costs on the IDEA Part C ARP 

funds in the same way as they calculate 
Topic IDEA Part B, Sections 611 and 619 IDEA Part C

B ARP funds in the same way as they 

calculate indirect costs on their IDEA Part 

B regular formula grant award.

indirect costs on their IDEA Part C 

regular formula grant award.

CEIS Section 613(f) of the IDEA and the 

regulations in 34 C.F.R. § 300.226 permit 

an LEA to use not more than 15 percent of 

the amount the LEA receives under Part B 

for any fiscal year (i.e., the aggregate of 

the LEA’s section 611 and section 619 

amounts for both the regular formula 

IDEA awards and the supplemental IDEA 

awards made available by the ARP), less 

any amount reduced by the LEA pursuant 

to 34 C.F.R. § 300.205, to develop and 

provide CEIS for students in kindergarten 

through grade 12 (with a particular 

emphasis on students in kindergarten 

through grade three) who are currently not

identified as needing special education or 

related services but who need additional 

academic and behavioral support to 

succeed in a general education 

environment.

Comprehensive CEIS (CCEIS) Under section 618(d)(2)(B) of the IDEA 

and the regulations in 34 C.F.R.

§ 300.646(d), the State or the Secretary of 

the Interior shall require any LEA 

identified under 34 C.F.R. § 300.646(a) 

and (b) to reserve the maximum amount 

of funds under section 613(f) of the IDEA
Topic IDEA Part B, Sections 611 and 619 IDEA Part C (i.e., 15 percent of the amount the LEA 

receives under Part B for any fiscal year) 

to provide CCEIS to address factors 

contributing to the significant 

disproportionality. The 15 percent is 

calculated based on the aggregate of the 

LEA’s section 611 and section 619 

amounts for both the regular formula 

IDEA awards and the supplemental IDEA

awards made available by the ARP.

Reporting All prime recipients of IDEA Part B funds 

must report subaward information as 

required by the Federal Funding 

Accountability and Transparency Act of 

2006 (FFATA), as amended in 2008. 

First-tier subaward information must be 

reported by the end of the following 

month from when the award was made or 

obligated. FFATA guidance is found at 

https://www.fsrs.gov/.The supplemental 

IDEA awards made available by the ARP 

will be assigned separate Catalog of 

Federal Domestic Assistance (CFDA) 

numbers, allowing the funds to be tracked 

separately from the regular IDEA awards.

All prime recipients of IDEA Part C funds 

must report subaward information as 

required by the Federal Funding 

Accountability and Transparency Act of 

2006 (FFATA), as amended in 2008. 

First-tier subaward information must be 

reported by the end of the following 

month from when the award was made or 

obligated. FFATA guidance is found at

https://www.fsrs.gov/. The supplemental 

IDEA awards made available by the ARP 

will be assigned separate Catalog of 

Federal Domestic Assistance (CFDA) 

numbers, allowing the funds to be tracked 

separately from the regular IDEA awards.

Audit Under 2 C.F.R. § 200.501(a), a non-

Federal entity that expends $750,000 or 

more during the non-Federal entity’s 

fiscal year in Federal awards must have a 

single or program-specific audit 

Under 2 C.F.R. § 200.501(a), a non-

Federal entity that expends $750,000 or 

more during the non-Federal entity’s 

fiscal year in Federal awards must have a 

single or program-specific audit 
Topic IDEA Part B, Sections 611 and 619 IDEA Part C

conducted for that year in accordance with 

the Uniform Guidance provisions.

Under 2 C.F.R. § 200.501(b), a non-

Federal entity that expends $750,000 or 

more during the non-Federal entity’s 

fiscal year in Federal awards must have a 

single audit conducted in accordance with 

the scope of the audit requirements in § 200.514 except when it elects to have a 

program-specific audit conducted in 

accordance with 2 C.F.R. § 200.501(c).

conducted for that year in accordance with 

the Uniform Guidance provisions.

Under 2 C.F.R. § 200.501(b), a non-

Federal entity that expends $750,000 or 

more during the non-Federal entity’s 

fiscal year in Federal awards must have a 

single audit conducted in accordance with 

the scope of the audit requirements in § 200.514 except when it elects to have a 

program-specific audit conducted in 

accordance with 2 C.F.R. § 200.501(c).