Bureau of Indian Affairs Schools
Expenditures in Selected Schools are Comparable to Similar Public Schools, But Data Are Insufficient to Judge Adequacy of Funding and Formulas
Gao ID: GAO-03-955 September 4, 2003
In 2001, Congress directed GAO to examine the adequacy of Bureau of Indian Affairs (BIA) school funding and the adequacy of the formulas employed by BIA to distribute various types of operating funds. Because there is no universally accepted standard for adequacy, for this report, GAO examined (1) the sources and amounts of federal funding provided for BIA schools and how they are determined, (2) how BIA school budgets and expenditures compared to national per-pupil expenditures and expenditures for similarly situated public schools, and (3) how equitably various formulas distribute funding across BIA schools and whether they account for all relevant costs. To obtain expenditure data for BIA schools GAO reviewed BIA budget and financial documents and collected data from 8 BIA and 6 public schools that were similar in terms of their relative isolation and student characteristics.
Most BIA school operating funds are provided by the Department of Interior through the standard federal budget process; however, the agency has little financial data to inform its school budget proposals. In 2002, Interior provided 78 percent of BIA's operating funds, while Education provided 22 percent. To formulate its annual budget proposals for BIA schools, Interior uses prior year data with updates for enrollment, teacher salaries, and fixed costs. Because BIA does not collect detailed expenditure data from its schools, GAO was unable to assess the overall adequacy of the funding. BIA budgeted dollars for its 112 day schools were higher on a per-pupil basis than the national average expenditure for public schools, but expenditures were comparable for selected similar BIA and public schools. However, all 8 BIA schools GAO visited spent less on instruction and more on facilities than the public schools visited. Also, most BIA school officials GAO spoke with reported that their budgets for transportation did not cover their actual transportation expenditures. About 40 percent of all BIA-operated schools (day and boarding) spent more on transportation than they received through their transportation budgets in school year 2001-2002. The six BIA formulas that BIA uses to distribute funds appear to have distributed funds fairly, but they did not include certain cost-related factors associated with BIA schools, and their adequacy cannot be determined from BIA's data. GAO found that the primary formula, the Indian School Equalization Program (ISEP) formula, distributed instructional funds equitably. The transportation formula for BIA schools does not account for costs associated with differences in degrees of isolation. Because BIA does not collect complete expenditure data, GAO was limited in its ability to assess the overall adequacy of the formulas.
Recommendations
Our recommendations from this work are listed below with a Contact for more information. Status will change from "In process" to "Open," "Closed - implemented," or "Closed - not implemented" based on our follow up work.
Director:
Team:
Phone:
GAO-03-955, Bureau of Indian Affairs Schools: Expenditures in Selected Schools are Comparable to Similar Public Schools, But Data Are Insufficient to Judge Adequacy of Funding and Formulas
This is the accessible text file for GAO report number GAO-03-955
entitled 'Bureau of Indian Affairs Schools: Expenditures in Selected
Schools are Comparable to Similar Public Schools, But Data Are
Insufficient to Judge Adequacy of Funding and Formulas' which was
released on September 04, 2003.
This text file was formatted by the U.S. General Accounting Office
(GAO) to be accessible to users with visual impairments, as part of a
longer term project to improve GAO products' accessibility. Every
attempt has been made to maintain the structural and data integrity of
the original printed product. Accessibility features, such as text
descriptions of tables, consecutively numbered footnotes placed at the
end of the file, and the text of agency comment letters, are provided
but may not exactly duplicate the presentation or format of the printed
version. The portable document format (PDF) file is an exact electronic
replica of the printed version. We welcome your feedback. Please E-mail
your comments regarding the contents or accessibility features of this
document to Webmaster@gao.gov.
This is a work of the U.S. government and is not subject to copyright
protection in the United States. It may be reproduced and distributed
in its entirety without further permission from GAO. Because this work
may contain copyrighted images or other material, permission from the
copyright holder may be necessary if you wish to reproduce this
material separately.
On January 2, 2004, this document was revised to add various
footnote references missing in the text of the body of the document.
Report to Congressional Committees:
United States General Accounting Office:
GAO:
September 2003:
Bureau of Indian Affairs Schools:
Expenditures in Selected Schools Are Comparable to Similar Public
Schools, but Data Are Insufficient to Judge Adequacy of Funding and
Formulas:
GAO-03-955:
GAO Highlights:
Highlights of GAO-03-955, a report to congressional committees
Why GAO Did This Study:
In 2001, Congress directed GAO to examine the adequacy of Bureau of
Indian Affairs (BIA) school funding and the adequacy of the formulas
employed by BIA to distribute various types of operating funds.
Because there is no universally accepted standard for adequacy, for
this report, GAO examined (1) the sources and amounts of federal
funding provided for BIA schools and how they are determined, (2) how
BIA school budgets and expenditures compared to national per-pupil
expenditures and expenditures for similarly situated public schools,
and (3) how equitably various formulas distribute funding across BIA
schools and whether they account for all relevant costs.
To obtain expenditure data for BIA schools GAO reviewed BIA budget and
financial documents and collected data from 8 BIA and 6 similar public
schools that were similarly situated in terms of their relative
isolation and student characteristics.
What GAO Found:
Most BIA school operating funds are provided by the Department of
Interior through the standard federal budget process; however, the
agency has little financial data to inform its school budget
proposals. In 2002, Interior provided 78 percent of BIA‘s operating
funds, while Education provided 22 percent. To formulate its annual
budget proposals for BIA schools, Interior uses prior year data with
updates for enrollment, teacher salaries, and fixed costs. Because BIA
does not collect detailed expenditure data from its schools, GAO was
unable to assess the overall adequacy of the funding.
BIA budgeted dollars for its 112 day schools were higher on a per-
pupil basis than the national average expenditure for public schools,
but expenditures were comparable for selected similar BIA and public
schools. However, all 8 BIA schools GAO visited spent less on
instruction and more on facilities than the public schools visited.
Also, most BIA school officials GAO spoke with reported that their
budgets for transportation did not cover their actual transportation
expenditures. About 40 percent of all BIA-operated schools (day and
boarding) spent more on transportation than they received through
their transportation budgets in school year 2001-2002.
The six BIA formulas that BIA uses to distribute funds appear to have
distributed funds fairly, but they did not include certain cost-
related factors associated with BIA schools, and their adequacy cannot
be determined from BIA‘s data. GAO found that the primary formula, the
Indian School Equalization Program (ISEP) formula, distributed
instructional funds equitably. The transportation formula for BIA
schools does not account for costs associated with differences in
degrees of isolation. Because BIA does not collect complete
expenditure data, GAO was limited in its ability to assess the overall
adequacy of the formulas.
What GAO Recommends:
GAO is making recommendations for BIA to (1) collect detailed
expenditure data comparable to public schools on BIA-operated schools
in order to better assess the adequacy of both funding and formulas,
(2) work with tribes to obtain detailed expenditure data from tribally
operated schools, (3) improve the transportation formula, and (4)
fully account for administrative services provided to BIA schools.
www.gao.gov/cgi-bin/getrpt?GAO-03-955.
To view the full product, including the scope and methodology, click
on the link above. For more information, contact Marnie S. Shaul at
(202) 512-7215 or shaulm@gao.gov
[End of section]
Contents:
Letter1:
Results in Brief:
Background:
BIA Schools Rely Primarily on Funding from Interior with Additional
Support from Education; BIA Has Little Financial Data to Inform Budget
Proposals:
BIA Per-Pupil Budgeted Funds Were Higher Than the National Average
Expenditure, but Spending Was Comparable for Selected BIA and Similar
Public Schools:
BIA's Formulas Generally Distributed Money Fairly, but Expenditure Data
Are Insufficient to Determine Adequacy:
Conclusions:
Recommendations:
Agency Comments:
Appendix I: Scope and Methodology:
Funding:
Formulas--Overview:
Formulas--Descriptions:
Formula Analyses:
Transportation:
Appendix II: Appropriations for BIA Schools, Fiscal Years 1999--2002:
Appendix III: Comments from the Department of Interior:
Appendix IV: GAO Contacts and Staff Acknowledgments:
GAO Contacts:
Staff Acknowledgments:
Tables:
Table 1: BIA-Funded School Facilities by Type, School Year 2001-02:
Table 2: Formulas Used by BIA to Distribute Funds to BIA Schools:
Table 3: Selected Characteristics of BIA Schools and Public Schools,
School Year 2000-01:
Table 4: Average BIA-Operated Day School and U.S. Average PPE for
School Year 1999-2000 by Category:
Table 5: Average PPE by Category for Selected BIA and Public Schools
Visited, School Year 2001-02:
Table 6: ISEP and Total Instructional Funding Per WSU:
Table 7: Administrative Cost Grants--the Difference between Calculated
Need and Distributed Funds in Tribally Operated BIA Schools, School
Years 1998-99 through 2002-03:
Table 8: BIA and Public Schools We Visited:
Table 9: ISEP Formula Weights for the Instructional Program:
Table 10: ISEP Formula Weights for the Residential Program:
Table 11: Transportation Formula Weights with Examples:
Table 12: Small School Adjustments for Disadvantaged Children (Title I)
Funds.
Table 13: Small School Adjustments for Title II, Parts A & D Funds:
Table 14: Means, Standard Deviations and Coefficient of Variation of
Instructional Funding by School Characteristics for On-Reservation
Boarding Schools, in School Year 2001-02:
Table 15: Means, Standard Deviations, and Coefficients of Variation of
Instructional Funding by School Characteristics for Day Schools, School
Year 2001-02.
Table 16: Transportation Regression Results Using Data from School Year
2001-02.
Table 17: Appropriations for BIA School Operations from the Department
of Interior and Amounts Received from the Department of Education,
Fiscal Years 1999-2002:
Table 18: BIA Education Construction Appropriations, Fiscal Years 1998-
2003:
Figures:
Figure 1: BIA Schools Operating Funds, Fiscal Years 1999-2002:
Figure 2: BIA School Operating Funds, Fiscal Year 2002:
Figure 3: Percent of Average PPEs Spent by 8 BIA Schools and for 6
Similarly Situated Public Schools, School Year 2001-02:
Figure 4: Percentage of BIA Students Identified as Needing Special
Education Services, School Year 1999-2003:
Abbreviations:
ACG: administrative cost grants:
ADM: average daily membership:
BIA: Bureau of Indian Affairs:
CCD: Core of Common Data:
DOD: Department of Defense:
FIS: financial information system:
IDEA: Individuals with Disabilities Education Act:
ISEP: Indian School Equalization Program:
NCES: National Center for Education Statistics:
OMB: Office of Management and Budget:
PPE: per-pupil expenditure:
WSU: weighted student unit:
United States General Accounting Office:
Washington, DC 20548:
September 4, 2003:
Congressional Committees:
The federal government spends over $600 million annually to provide
educational services to approximately 48,000 Indian students in 171
schools and 14 dormitories funded by the Department of Interior's
(Interior) Bureau of Indian Affairs (BIA). Although these schools are
located across the nation, 70 percent are located on or near Indian
reservations in four states: Arizona, New Mexico, North Dakota, and
South Dakota. BIA directly operates one-third of the schools, while
tribes operate the remaining two-thirds through grants and contracts
with BIA. BIA schools have certain characteristics that make them more
costly to operate than the average public school, specifically, a high
proportion of students with special needs and a broader infrastructure
of sewer, water, utility, and other systems to support.[Footnote 1] In
addition, some studies have also attributed some of BIA's higher costs
to their isolation and smaller size, as well as the presence of a
boarding component in one-third of BIA schools.[Footnote 2]
In 2001, Congress directed us to examine the adequacy of BIA school
funding and the adequacy of the formulas employed by BIA to distribute
various types of operating funds.[Footnote 3] Although there is no
single standard for adequacy, for this report, we examined BIA funding
in terms of how BIA's budgets are determined, how funding compares with
public schools, and the equity and relevance of formulas used to
distribute those funds. Specifically, we examined (1) the sources and
amounts of federal funding provided for BIA schools and how they are
determined, (2) how BIA school budgets and expenditures compare to
national per-pupil expenditures (PPE) and expenditures for similarly
situated public schools, and (3) how equitably various formulas
distribute funding across BIA schools and whether they account for all
relevant costs.
To obtain expenditure information, we reviewed BIA budget and financial
documents and collected expenditure data at 8 BIA and 6 public schools
in Arizona, New Mexico, North Dakota, and South Dakota that were
similarly situated in terms of their relative isolation and the
characteristics of their student populations. Because BIA does not
maintain expenditure data on all of the schools it funds--specifically
those that are tribally operated--we compared the most recent national
expenditure data (school year 1999-2000) with BIA's budget data for
that year. BIA does maintain some expenditure data for the 32 day
schools it directly operated in school year 1999-2000, representing 13
percent of enrollment at all BIA-funded schools, and we were able to
compare these schools with national school expenditures in terms of
instruction, transportation, facilities, and administration for the
same year. In our study of expenditures, we excluded boarding schools
when comparing BIA schools with public schools because boarding schools
have additional costs that are not comparable with those of the average
public school but included them when we analyzed differences between
budgeted and expended amounts for transportation. All of our analyses
exclude funding for food. We obtained budget and expenditure data from
BIA's financial information system, took steps to assess the
reliability of the required data, and determined that the data were
sufficiently reliable for the purposes of this report. To compare
expenditures for BIA schools (both tribally operated and BIA-operated)
with similar public schools, we visited and collected expenditure data
from the 8 BIA and the 6 public schools that had such data. These BIA
and public schools were selected to be similar as a group, they were
not matched one-to-one. These results are not generalizable to other
BIA schools. In our evaluation of the 6 BIA formulas used to distribute
funds to schools for instruction, transportation, administration, and
facilities maintenance, we included all BIA schools, including boarding
schools. We used an accepted measure, the federal range ratio, to
determine fairness. We interviewed officials from Interior, including
BIA officials, and the Department of Education (Education). (See
appendix I for more details on our scope and methodology.):
We performed our work from November 2002 through August 2003 in
accordance with generally accepted government auditing standards.
Results in Brief:
Most BIA school operating funds are provided by Interior through the
standard federal budget process; however, the agency has little
financial data to use in forming the budget that Interior proposes to
Congress. Through Education, BIA schools also receive a designated
percentage of major Education program grants that are available to all
the nation's public schools. In 2002, Interior provided $500 million
(78 percent) of BIA's operating funds, while Education provided $140
million (22 percent). Additional funds came primarily from the U.S.
Department of Agriculture and from the Department of Health and Human
Services' Indian Health Service. To formulate its annual budget
proposals for BIA schools, Interior uses prior year data with updates
for enrollment, teacher salaries, and fixed costs. However, BIA has no
formal mechanism, such as a needs assessment, for determining how much
funding is needed for instruction or transportation, although it does
have such mechanisms for facilities maintenance and administration.
Moreover, BIA does not collect detailed expenditure data from all
schools from which such determinations could be made.
BIA budgeted dollars for all its day schools were higher on a per-pupil
basis than the national average expenditure for public schools;
however, expenditures were comparable for selected BIA and public
schools with similar levels of isolation and poverty. In school year
1999-2000, the average amount BIA budgeted for day school students was
$9,167 per pupil, while the national average PPE was $6,617. When we
conducted site visits to 8 BIA and 6 public schools, we found their
expenditures to be similar overall. On average, the BIA school PPE was
$10,140, while the public school PPE was $10,358 in school year 2001-
02. However, all the BIA schools we visited spent less on instruction
and more on facilities than their public school counterparts. Also, six
of the eight BIA school officials we spoke with reported that their
budgets for transportation did not cover their actual expenditures. To
compensate, BIA school officials said they typically spend funds from
other budget categories to cover transportation shortfalls, while three
of the four tribally operated school officials told us they were able
to use other sources--such as administrative funds or earned interest-
-not available to BIA-operated schools. Both the BIA and public school
officials said that isolation affected their operating costs,
particularly for instruction and transportation.
The six formulas that BIA uses to distribute funds to the schools
appear to have distributed funds fairly, but they did not include
certain cost-related factors associated with BIA schools; and their
adequacy cannot be determined from BIA's data. We found that the
primary formula, the Indian School Equalization Program (ISEP) formula,
distributed instructional funds equitably among schools based on
student enrollment adjusted for grade level and certain student
characteristics. We also found that a recent change in the ISEP formula
that eliminated weights for special education students was followed by
a reduction in the number of students identified as needing special
education. We found that with regard to the transportation formula for
BIA schools, it does not account for costs associated with differences
in degrees of isolation. The other formulas, which determine overall
amounts needed to support administration and also facilities
maintenance and operations, have been funded at about 80 percent
annually. Because BIA does not collect complete expenditure data, we
were limited in our ability to assess the overall adequacy of the
formulas.
We are making several recommendations for BIA to collect additional
expenditure data in order to better assess the adequacy of both funding
and formulas, to improve the transportation formula, and to allocate
all costs of administering BIA schools.
Background:
While most Indian children attend regular public schools, about 10
percent attend the 171 BIA schools that are funded by BIA and operated
either by the bureau or by various tribes through grants or contracts
(see table 1). BIA schools are found in 23 states but are highly
concentrated in 4--Arizona, New Mexico, North Dakota, and South Dakota.
In school year 2002-03, BIA was responsible for the education of
approximately 48,000 children in 171 schools scattered across 63
reservations.[Footnote 4] The bureau's responsibility for Indian
schools is somewhat similar to the responsibility of a state for public
schools, although its responsibilities include more areas, such as
facilities. To help manage the schools, BIA has 24 regional agencies,
called education line offices, that are similar to public school
district offices, although each regional agency has responsibility for
a larger geographic area than most school districts.
Table 1: BIA-Funded School Facilities by Type, School Year 2001-02:
School type: Day schools; Responsibility for operations: BIA: 33[A];
Responsibility for operations: Tribes: 84; Total: 117.
School type: Boarding schools; Responsibility for operations: BIA: 30;
Responsibility for operations: Tribes: 24; Total: 54.
School type: Subtotal schools; Responsibility for operations: BIA: 63;
Responsibility for operations: Tribes: 108; Total: 171.
School type: Dormitories; Responsibility for operations: BIA: 1;
Responsibility for operations: Tribes: 13; Total: 14.
School type: Total; Responsibility for operations: BIA: 64;
Responsibility for operations: Tribes: 121; Total: 185.
Source: GAO analysis of BIA data.
[A] In school year 1999-2000, there were 32 BIA-operated day schools.
This was the year we used for comparison to national averages, the
latest data available.
[End of table]
A high percentage of the student population in the BIA system is
characterized by factors that are generally associated with higher
costs in education. Almost all students live in poverty, and more than
half are limited in their English proficiency. A substantial number
have disabilities. The academic performance of many BIA students is
below that of public school students.[Footnote 5]
Funding for BIA schools is determined through an iterative budget
development process. The Office of Management and Budget (OMB) gives
Interior a planning allowance to work with and also reviews Interior's
final budget submission. The major parties involved at Interior are
BIA's Office of Indian Education Programs; Interior's Office of Policy,
Management and Budget; and the Assistant Secretary for Indian Affairs.
Periodically, the Office of Indian Education Programs meets with tribes
to discuss the needs and priorities of their schools. That office also
solicits priorities from education line officers--BIA regional
administrators whose role is somewhat analogous to school district
superintendents.
Funding for BIA schools is distributed in several ways. Funds from
Interior are distributed through four formulas:[Footnote 6] one
primarily for instruction (ISEP), one for transportation, one for
administration, and another for facilities maintenance. Two of these
formulas calculate needed amounts to fulfill their respective
functions. One calculates administrative cost grants for tribally
operated schools and the other calculates funding for facilities
maintenance and operation for all schools. The ISEP formula distributes
the largest amount of Interior funds, 68 percent. In addition to funds
from Interior, funds from Part A of Titles I, II, and IV of the No
Child Left Behind Act are distributed by formulas, as well as funds for
Part D of Title II. [Footnote 7] (See table 2.) Title I, II, and IV
funds are among Education's funds that flow through BIA. (See app.
II.):
Table 2: Formulas Used by BIA to Distribute Funds to BIA Schools:
Formula for: ISEP[A]; Department/agency allocating funds: BIA; Purpose
of funding: Education[B]; Basis for distribution: Weighted student
units[C].
Formula for: Transportation; Department/agency allocating funds: BIA;
Purpose of funding: Student transportation; Basis for distribution:
Daily miles[D].
Formula for: Operations and maintenance of facilities[E]; Department/
agency allocating funds: BIA; Purpose of funding: Facilities
maintenance and operations; Basis for distribution: Characteristics of
facilities[F].
Formula for: Administrative cost grants for Indian schools; Department/
agency allocating funds: BIA; Purpose of funding: Administration and
indirect costs of tribally operated schools; Basis for distribution:
Program cost[G].
Formula for: Safe and Drug-Free Schools and Communities (Title IV, Part
A)[H]; Department/agency allocating funds: Education; Purpose of
funding: Education[C]; Basis for distribution: WSU[I].
Formula for: Titles I and II (Parts A & D)[J]; Department/agency
allocating funds: Education; Purpose of funding: Education[C]; Basis
for distribution: Enrollment[K].
Source: GAO analysis.
[A] The ISEP formula includes funds for school-level administration,
such as principals' salaries and administrative assistance, in addition
to salaries for teachers, teacher aides, and the cost of materials.
[B] Education includes functions such as teaching, professional
development, and school-level administration.
[C] Weighted student units (WSU) are calculated by adjusting enrollment
counts by student characteristics such as grade, bilingual
classification, gifted and talented designation, and residency status
at the school. For example, students who reside at the school receive a
higher weight and therefore are given additional funds to cover their
boarding expense.
[D] BIA distributes money for transportation across schools by
adjusting miles traveled by road condition; i.e., whether the roads are
improved or unimproved.
[E] The formula used for projecting funding for facilities maintenance
and operations was not used for a couple of years.
[F] The facilities operations formula generates an amount needed for
each school based on such factors as the age of the school, the square
footage of the school, the technology at the school, and other
characteristics of the school.
[G] The formula for administrative cost grants calculates an
administrative rate based on the cost of the program being administered
by the tribe. The 'program' may just be the school operations, or it
may be the school along with other entities operated by the tribe.
[H] The Safe and Drug-Free Schools and Communities program is Title IV,
Part A, of the No Child Left Behind Act of 2001.
[I] The WSU used to distribute "Safe and Drug Free Schools and
Communities" funds are based on grade and residency.
[J] Title I and Title II, Parts A and D, of the Elementary and
Secondary Education Act of 1965 as amended. Title I is entitled
"Improving the Academic Achievement of the Disadvantaged" and will be
referred to as "Disadvantaged Children" throughout this report. Title
II, Part A, is entitled "Teacher and Principal Training and Recruiting
Fund." Title II, Part D is entitled "Enhancing Education through
Technology." We refer to both parts of Title II as "Title II" in this
report.
[K] Disadvantaged Children and Title II, Parts A & D program funds use
an enrollment measure as the basis for distributing funds, with a
special adjustment (more money) given to small schools.
[End of table]
Additionally, BIA distributes other funds from Education without
formulas. For example, funds for Individuals with Disabilities
Education Act (IDEA), Part B--providing the largest amount of Education
funding to BIA--are distributed based on proposals documenting the
school's exhaustion of the ISEP special education set-aside.[Footnote
8] The proposals must also be consistent with each school's
consolidated school reform plan. BIA distributes funds from other
Education programs, such as Title I, Part F and Title IV, Part B, by
either dividing the money equally among the schools or by granting
funds to schools based on proposals (also consistent with the school's
consolidated school reform plan).
In general, formulas are designed to distribute funds efficiently and
equitably by taking real cost differences, factors that have been
identified as having a significant effect on costs incurred, into
consideration. For example, some research, though not definitive, shows
that children with special needs--low-income students, students with
disabilities, and students with limited English proficiency--may
require additional educational resources to succeed at the level of
their nondisadvantaged peers. Because these additional resources
require higher spending, some researchers have adjusted PPE by
"weighting" these students to account for the additional spending that
may be required.[Footnote 9] Two of the three instructional formulas
used by BIA are based on such weights. They account for differences
among students by creating WSUs based on grade level, bilingual
designation, gifted and talented designation, level of disability, and
residency at the school. For example, in the ISEP formula fourth
graders were assigned a weight of 1.15, while first graders were
assigned a weight of 1.38.[Footnote 10] Recently, BIA officials removed
the weights for student disability and placement in the ISEP
formula[Footnote 11] in response to a finding by Education that BIA was
out of compliance with the provision of IDEA that students be educated
in the least restrictive environment possible.[Footnote 12]
BIA maintains a financial information system that contains data on
budgeted (appropriated and obligated) funds and expenditures by school.
However, these data contain actual expenditures for only the 32 BIA-
operated schools. The "expenditure" data on tribally operated schools
in this financial system are proposed expenditures. Tribally operated
schools are not required to report actual expenditures to BIA.
In the budget proposal for fiscal year 2004,[Footnote 13] OMB found
that BIA does not yet have a financial management system that fully
allocates program costs and associates those costs with specific
performance measures. However, OMB noted that this requirement might be
met through a new accounting system that Interior is adopting. OMB
found that BIA did not have adequate academic performance and cost-
efficiency measures that provide valid comparisons with public schools
in rural areas with high concentrations of Indian students. In response
to this finding, BIA said that it will develop academic performance and
cost-efficiency measures that are comparable to similarly situated
public schools.
To help districts develop useful, comparable accounting systems,
Education has developed cost categories for use in school districts and
states nationwide.[Footnote 14] This publication was designed as a
national standard for state departments of education to use in
reporting financial data to ensure that education fiscal data can be
reported in a comprehensive and uniform manner.
BIA Schools Rely Primarily on Funding from Interior with Additional
Support from Education; BIA Has Little Financial Data to Inform Budget
Proposals:
Interior provides most of the funding for BIA schools, but the agency
has little financial data to inform its budget proposals. Additional
funds are provided by Education in the form of grants for
disadvantaged, disabled, and other targeted students. (See fig. 1.) BIA
school operations funding provided through Interior along with
Education's funds constitute almost all operating funds available for
BIA schools. Interior appropriations for BIA school operations,
excluding facilities, grew 11.9 percent (in nominal dollars) between
fiscal years 1999 and 2002, primarily through growth in the ISEP
funds.[Footnote 15] However, when inflation is taken into account, the
growth was 3.6 percent. During the same period, there was a slight
decline in enrollment. In formulating its annual budget proposals,
Interior uses prior year funding as a basis and considers projected
changes in enrollment as well as teachers' salaries and other fixed
costs. However, the agency has no cost basis for determining the level
of its funding requests for some parts of its operating budget.
Figure 1: BIA Schools Operating Funds, Fiscal Years 1999-2002:
[See PDF for image]
[End of figure]
Interior Provided about 78 Percent of BIA School Operating Funds While
Major Education Programs Provided 22 Percent:
In fiscal year 2002, Interior provided about 78 percent of BIA school
operating funds ($500 million), while Education provided about 22
percent ($140 million) through programs that are available to all
public schools in the nation. Interior's appropriations for BIA school
operations grew 5.9 percent between fiscal year 1999 and 2002,
primarily through growth in ISEP funds.[Footnote 16] The majority of
educational funds came from ISEP and Education.[Footnote 17] Education
primarily funded grants supporting disadvantaged and disabled students.
(See fig. 2.) The program funds from Education have constituted an
increasing share of BIA school operating budgets since fiscal year 1999
(from 18.2 percent to 22 percent in fiscal year 2002), in part, due to
large increases since 1999 in two major education programs under which
BIA receives funds.[Footnote 18] BIA Title I funds for disadvantaged
students increased by 21 percent from 1999-2002, while funds for
students with disabilities under the IDEA increased by 50 percent.
Figure 2: BIA School Operating Funds, Fiscal Year 2002:
[See PDF for image]
Note: Percentages may not add to 100 due to rounding.
[End of figure]
Interior Formulated Its Budget Proposals Based on Prior Year Funding
with Only Limited Financial Data:
In formulating the annual budget request for BIA schools, Interior
officials we spoke with said the agency strives to maintain current
levels of educational service to BIA schools. However, we found the
agency had limited historical expense data for determining the level of
its funding request, consistent with OMB's findings. BIA officials said
they generally consider prior year funding to which they request some
increases. Agency officials reported that they take into account
changes in projected enrollment and estimated increases in teachers'
salaries and fixed costs. They also consider input from tribal leaders
and regional agency officials. Although BIA collects and maintains some
expenditure information from the schools it operates, it does not
collect expenditure data from the tribally operated schools that
comprise two-thirds of the schools it funds. In addition, while its
formulas for administration and for facilities operations make some
funding projections, it is unclear whether such projections inform
BIA's budget proposals. Moreover, BIA has no formal mechanism, such as
a cost-based formula or needs assessment, or expenditure data for
determining how much funding is needed for instruction or
transportation. For example, the ISEP formula distributes the available
funds and is not based on the actual cost of educating children.
BIA Per-Pupil Budgeted Funds Were Higher Than the National Average
Expenditure, but Spending Was Comparable for Selected BIA and Similar
Public Schools:
BIA budgeted more for its day schools, per pupil, than the national
average expenditure for public schools; but for a selected group of BIA
and public schools with similar levels of poverty and isolation, PPEs
were comparable. BIA does not have expenditure data for all of its
schools, so to make a national comparison, we compared BIA per-pupil
budgeted dollars for 112 day schools with national PPEs, and found that
BIA's budgeted funds were higher.[Footnote 19] BIA has expenditure data
for 32 schools that it directly operates, and when we compared these
data for school year 1999-2000, we found that spending for these
schools was higher than the national average in three of four
categories: instruction and related activities, transportation, and
administration.[Footnote 20] Finally, we conducted field work to
compare a small number of BIA schools and public schools whose student
makeup and environments were similar and we found their expenditures to
be on par, overall. For the 8 BIA schools and 6 public schools where we
collected data there was comparable spending, although the BIA schools
spent less on instruction than their public school counterparts. Most
BIA school officials (6 out of 8) we spoke with reported budget
shortfalls for transportation. Both BIA and public school officials
told us that isolation affected their operating costs, particularly for
instruction and transportation.
BIA Per-Pupil School Budget Was Higher Than National Average Spending:
BIA budgeted more per pupil for its 112 day schools, on average, than
public schools spent in fiscal year 1999-2000--$9,167 budgeted[Footnote
21] versus $6,617 spent for public schools.[Footnote 22] However, per-
pupil funding among BIA day schools and among all public schools varied
widely. The BIA day schools' budgets ranged from $5,937 per pupil to
$24,531.[Footnote 23] Among public school districts nationwide, the PPE
range was greater-from $2,350 per pupil to $39,032.[Footnote 24]
BIA schools and their students have a number of characteristics that
may account for some of the higher budget levels in their funding. They
are generally smaller than public schools and are more geographically
dispersed, making it more difficult for them to achieve economies of
scale. Unlike public schools, many BIA schools are also responsible for
more infrastructure, such as sewer and water systems.[Footnote 25]
Finally, BIA schools have a much higher degree of poverty and special
needs students than public schools nationally, factors associated with
higher resource needs. (See table 3.):
Table 3: Selected Characteristics of BIA Schools and Public Schools,
School Year 2000-01:
Characteristic: Average enrollment for elementary & secondary schools;
BIA schools (n=171): 265; Public schools (n=84,596): 546[B].
Characteristic: Percent students eligible for free or reduced lunch;
BIA schools (n=171): >80%; Public schools (n=84,596): 39%[C].
Characteristic: Percent students identified with disabilities; BIA
schools (n=171): 21%; Public schools (n=84,596): 13%[D].
Characteristic: Percent students with language needs; BIA schools
(n=171): 58%; Public schools (n=84,596): 5%.
Source: GAO analysis of BIA and Education data.
[A] BIA enrollment data.
[B] U.S. Department of Education, National Center for Education
Statistics (NCES), Overview of Public Elementary and Secondary Schools
and Districts: School Year 2000-2001.
[C] U.S. Department of Education, NCES, Common Core of Data, Local
Education Agency Universe Survey, 1999-2000.
[D] U.S. Department of Education, NCES, Condition of Education, 2002,
Indicator 28 (data presented is from 1998-99).
[End of table]
Expenditures for BIA-Operated Day Schools Were Higher Than U.S. Average
but Comparable for Selected BIA and Similar Public Schools:
Expenditures at BIA-operated day schools were higher than the U.S.
average but comparable for selected similarly isolated BIA and public
schools. Spending in three of four categories--instruction and related
activities, student transport, and administration--for the 32 BIA-
operated schools was greater than the national per-pupil averages in
school year 1999-2000; facilities operations spending was lower. (See
table 4.):
Table 4: Average BIA-Operated Day School and U.S. Average PPE for
School Year 1999-2000 by Category:
Category: Instruction and related activities[A]; BIA-operated school
PPE (n=32 schools): $5,924; U.S. average PPE (n=85,000 schools):
$5,140.
Category: Student transportation; BIA-operated school PPE (n=32
schools): 773; U.S. average PPE (n=85,000 schools): 278.
Category: Facilities operations[B]; BIA-operated school PPE (n=32
schools): 352; U.S. average PPE (n=85,000 schools): 665.
Category: Administration[C]; BIA-operated school PPE (n=32 schools):
694; U.S. average PPE (n=85,000 schools): 535.
Category: Total PPE for four areas[D]; BIA-operated school PPE (n=32
schools): $7,743; U.S. average PPE (n=85,000 schools): $6,617.
Source: GAO analysis of BIA and NCES data.
[A] Includes salaries and benefits for teachers and instructional
aides, supplies, purchased services such as instructional television,
instructional staff training, educational media (library and
audiovisual), and other support services.
[B] Includes supervision of operations and maintenance, operation of
buildings, the care and upkeep of grounds and equipment, security, and
utilities.
[C] Includes board of education, local education agencies, school
administration, district administration (including BIA regional
offices), graduation expense, and clerical support staff. BIA does not
identify all administrative costs for BIA-operated schools; therefore,
administrative costs may be higher than stated.
[D] Total PPEs excludes food expenditures and may not add due to
rounding.
[End of table]
However, the 2001-02 school year expenditures for the 14 similarly
situated BIA and public schools we visited were similar. In school year
2001-02 PPEs averaged $10,140 for BIA students compared with $10,358
for public school students. Specifically, we found that expenditures
for both groups--BIA schools and public schools--were higher than the
national average in all categories, as shown in table 5.
Table 5: Average PPE by Category for Selected BIA and Public Schools
Visited, School Year 2001-02:
Category: Instruction and related activities[B]; BIA day schools: BIA-
operated schools PPE (n=4): $7,016; BIA day schools: Tribally operated
schools PPE: (n=4): $7,307; BIA day schools: Total BIA schools PPE
(n=8): $7,162; Similar public schools PPE (n=6): $7,628; U. S. average
PPE[A] (n=85,000): $5,140.
Category: Student transport; BIA day schools: BIA-operated schools PPE
(n=4): 504; BIA day schools: Tribally operated schools PPE: (n=4): 863;
BIA day schools: Total BIA schools PPE (n=8): 684; Similar public
schools PPE (n=6): 643; U. S. average PPE[A] (n=85,000): 278.
Category: Facilities operations[C]; BIA day schools: BIA-operated
schools PPE (n=4): 1003; BIA day schools: Tribally operated schools
PPE: (n=4): 1,147; BIA day schools: Total BIA schools PPE (n=8):
1,075; Similar public schools PPE (n=6): 916; U. S. average PPE[A]
(n=85,000): 665.
Category: Administration[D]; BIA day schools: BIA-operated schools PPE
(n=4): 969; BIA day schools: Tribally operated schools PPE: (n=4):
1,470; BIA day schools: Total BIA schools PPE (n=8): 1,220; Similar
public schools PPE (n=6): 1,171; U. S. average PPE[A] (n=85,000): 535.
Category: Total PPE for four areas[E]; BIA day schools: BIA-operated
schools PPE (n=4): $9,492; BIA day schools: Tribally operated schools
PPE: (n=4): $10,787; BIA day schools: Total BIA schools PPE (n=8):
$10,140; Similar public schools PPE (n=6): $10,358; U. S. average
PPE[A] (n=85,000): $6,617.
Source: GAO analysis.
Note: The PPEs listed were calculated by dividing each total category
expenditures by the average enrollment of the study schools. We used
BIA enrollment for the BIA schools and Core of Common Data (CCD)
enrollment for the public schools.
[A] For school year 1999-2000.
[B] Includes salaries and benefits for teachers and instructional
aides, supplies, purchased services such as instructional television,
instructional staff training, educational media (library and
audiovisual), and other support services.
[C] Includes supervision of operations and maintenance, operation of
buildings, the care and upkeep of grounds and equipment, security, and
utilities.
[D] Includes board of education, local education agencies, school
administration, district administration (including BIA regional
offices), graduation expense and clerical support staff. BIA does not
identify all administrative costs for BIA-operated schools; therefore,
administrative costs may be higher than stated.
[E] PPEs exclude food expenditures. Numbers may not add due to
rounding.
[End of table]
Instruction and Related Activities:
In school year 1999-2000 the 32 BIA-operated day schools spent more
($5,924) than the national average ($5,140) for instruction and related
activities--typically the largest portion of any school budget. Teacher
salaries in the BIA-operated schools (but not the tribally operated
schools) are determined by the Department of Defense's (DOD) teacher
salary scale, which, according to our recent study, is higher than the
national average for public schools. For example, in school year 2000-
01, the average salary in DOD overseas schools was $47,460 while the
national average was $43,250.[Footnote 26] BIA officials reported that
teacher training costs were also higher than average because of the
relative isolation of the schools on reservations and their distance
from training sites. Consequently, funding for advanced teacher
training for many BIA school teachers must include travel and lodging.
In the 14 schools we visited, all schools were substantially above the
national average. However, we found that both the tribally operated and
the BIA-operated schools spent lower amounts for instruction ($7,307
and $7,016, respectively) than the public schools ($7,628).
Additionally, a smaller proportion of their overall budget was spent on
instruction. The BIA schools spent approximately 70 percent of their
expenditures on instruction, while the public schools spent 74 percent.
(See fig. 3.) Two of the public schools and two tribally operated
schools said they did not have enough money for instruction.
Figure 3: Percent of Average PPEs Spent by 8 BIA Schools and for 6
Similarly Situated Public Schools, School Year 2001-02:
[See PDF for image]
[End of figure]
Isolation of BIA and public schools had an impact on the recruitment
and retention of teachers, according to 12 of 14 school officials. Four
public and 5 BIA school officials told us they offered low-cost housing
to the teaching staff as an added incentive because housing is
extremely limited on or near Indian reservations. The attrition rate of
teachers, measured by the percent of the teachers employed in school
year 2001-02 who did not return the next school year, was higher for
the 4 tribally operated schools we visited (26 percent) and for the 6
selected public schools (14 percent) than the national average (7
percent). In contrast, the 4 BIA-operated schools experienced a lower
attrition rate (4 percent), which may be due to the higher teacher
salary scale of BIA-operated schools. According to officials we spoke
with at 5 of the 8 BIA schools and 3 of the 6 public schools, isolation
affected their ability to recruit or retain teachers.
Student Transportation:
The average per-pupil spending for transportation at the 32 BIA-
operated schools ($773) was more than twice the national average ($278)
in school year 1999-2000. BIA officials we interviewed said most BIA
schools are in remote areas and the buses travel long distances
frequently on unpaved roads to pick up students. Unlike public school
districts that service their vehicles locally, BIA buses often have to
travel long distances to be serviced at government service centers.
Also unlike public schools, which generally own their buses and share
them throughout a district, the geographically dispersed BIA schools
usually lease their buses and shoulder transportation costs
individually. In addition, we found that almost 40 percent of the 63
BIA-operated day and boarding schools spent more on transportation than
they received through their transportation budgets in school year 2001-
02.
In the 14 schools we visited, the tribally operated schools spent more
on transportation than their public school counterparts, while the BIA-
operated schools spent less. School officials gave us similar
explanations to the four listed above by BIA officials for the higher
than average cost of transportation. They also provided us with
examples.
* The percent of unimproved roads buses traveled for the 14 schools we
visited ranged from 0 to 100 percent.
* Two of the 14 schools paid parents to bring children to feeder routes
to avoid further bus travel on difficult roads.
* BIA buses traveled greater distances (an average of 465 miles/day)
than the public school buses (an average of 379 miles/day), putting
more wear and tear on the buses.
* Most of the BIA school officials also reported that they had to
travel longer distances for maintenance of their buses than their
public school counterparts.
* Most of the BIA school officials reported that they leased their
buses from the government service center,[Footnote 27] while most of
the public schools reported owning their buses and maintaining them in
the local district or with local service contractors. The capital costs
incurred for owning buses are not paid out of the transportation line
of public school budgets, so they are not included in the PPEs of
public schools; however, they are costs incurred through the leasing
rates that BIA schools pay. Therefore, BIA schools likely spend more on
their leased buses from transportation funds than the public schools
spend on those they own.
Officials from both groups of BIA schools told us they have
transportation budget shortfalls and their spending reflects transfers
from other budget categories. Three of the 4 tribally run schools
reported making up the shortfalls by using other sources of funding
available to them, such as administrative funds and interest
income.[Footnote 28] For example, one tribal school official reported
the school received just under $200,000 and spent close to $300,000 for
transportation by using administrative funds and also interest income.
BIA-operated schools, which have no investment funds or administrative
funds, reported using only instructional funds to make up their
transportation shortfalls. The 6 public schools we visited did not
report shortfalls in transportation.
Facilities operations:
The average PPE for facilities maintenance for the 32 BIA-operated
schools ($352) was lower than the national average of $665 in school
year 1999-2000, despite the fact that BIA has a backlog[Footnote 29] of
deferred maintenance for its nearly 2,200 buildings at 171 elementary
and secondary schools. For school year 1999-2000, 65 percent of BIA
schools were reported in less than adequate condition.[Footnote 30] In
contrast, only 24 percent of public schools were reported to be in less
than adequate condition.[Footnote 31] In February 2001, this backlog
totaled $962 million in needed work, but by October 2002, the backlog
dropped to $642 million. Until recently, BIA has not had adequate
information to determine the funding needed at each school site for
heating, lighting, and other operating expenses. However, a new
facilities management information system has been recently implemented
to address the shortcomings of the old system.[Footnote 32]
In the 14 schools we visited, we found that the BIA schools spent more
per pupil on facilities operations ($1,003 for BIA-operated; $1,147 for
tribally operated) than the public schools ($916). However, none of the
BIA school officials reported the condition of their school as good. In
contrast, officials at 5 of the 6 public schools described their
facilities as good or excellent. Officials at 7 of the 8 BIA schools
rated their facilities as fair to poor and complained about a long-
standing lack of investment in operation and repair. Unlike their
public school counterparts, many of the local BIA school officials said
that routine preventive maintenance and repairs are frequently deferred
in favor of other, more critical needs. This has resulted in higher
costs for repairs and a negative impact in the functionality of the
facilities, according to these officials. They said some of these
problems affected the safety of children and the educational climate of
their schools, citing a nonfunctional fire hydrant and fire alarm
system, inoperable emergency generator, an eroded bathroom floor,
problems with heating/air-conditioning systems, a fuel tank spill, and
problems with sewer lines and water pipes.
Administration:
In the 32 BIA-operated day schools, we found that BIA distributes
administrative dollars differently than public schools do and does not
use accounting categories that are nationally comparable. For example,
BIA budgets money for program management (including principals'
salaries) to all its schools through instructional funds (ISEP) rather
than treating them as administrative costs. Therefore, on a national
level it is difficult to compare or evaluate administrative funding for
BIA schools. After adjusting for as many of these differences as
possible, we found the 32 BIA-operated schools spent more on
administration ($694) than the public schools nationwide ($535).
However, it is likely that administrative expenditures for BIA-operated
schools are understated for several reasons. First, BIA itself provides
administrative services to the schools it operates but does not
necessarily recognize in its accounting records the full cost of those
services, as required by federal accounting standards.[Footnote 33]
Second, administrative funds that BIA provides to its regional agencies
(education line offices), which are counterparts to public school
district offices, are not systematically allocated and tracked to the
schools.[Footnote 34]
In the 14 schools we visited, the 8 BIA schools had higher
administrative costs than the 6 similar public schools, $1,220 and
$1,171, respectively. There was a notable difference between the BIA-
operated and tribally operated schools. Tribally operated schools had
higher expenditures for administration than the public schools while
BIA-operated schools had lower expenditures for administration.
BIA's Formulas Generally Distributed Money Fairly, but Expenditure Data
Are Insufficient to Determine Adequacy:
The six formulas generally allow for equitable distribution of funds
among schools, but we did not have enough expenditure data to fully
assess the formulas' adequacy in terms of how well they account for
relevant costs. Overall, we found that the three instructional formulas
resulted in a fair distribution of funds; that is, students and schools
with similar characteristics were treated similarly in terms of
funding. A recent change to the largest of the instructional formulas
was followed by fewer students being identified as having disabilities,
but it is too early to determine the impact of the change on the
distribution of funds among the BIA schools. With regard to the
transportation formula, we found that it may not account for certain
differences among schools. The remaining formulas, which project needed
amounts for facilities operations and for administration, adequately
accounted for relevant costs, but they were funded at levels below
their projections. Whether the formulas are more or less than adequate
is not clear due to the lack of expenditure data. See appendix I for
further discussion of these formulas.
BIA's Primary Formulas for Instruction Distributed Funds Fairly:
Our analysis indicates that in school year 2001-02, instructional funds
were distributed fairly among schools based on student enrollment
adjusted for grade level and certain other student characteristics,
such as English proficiency and disability level.[Footnote 35] ISEP
allocations ranged from $3,291 to $4,344 per WSU, which is a small
variation according to the federal range ratio, an accepted measure for
assessing equity.[Footnote 36] When considering all instructional funds
combined except for disability-related funds from Education, the
variation was greater, ranging from $3,849 to $5,619 per WSU; but this
is still an acceptable variation according to the federal range ratio.
(See table 6.) The greater range in instructional funds per WSU can be
attributed to two factors: (1) the funds for Disadvantaged Children and
Title II, Parts A and D are distributed on a per-pupil basis rather
than a WSU basis and (2) both programs also include extra money for
small schools. We found no substantial difference between BIA-operated
and tribally operated schools in instructional funding per WSU.
Table 6: ISEP and Total Instructional Funding Per WSU:
ISEP funding per WSU; Average: $3,767; Range: $3,291 to $4,344; Federal
range ratio[A]: 4.5%.
Total instructional[B] funding per WSU; Average: $4,570; Range: $3,849
to $5,619; Federal range ratio[A]: 20%.
Source: GAO Analysis of BIA financial and enrollment data.
[A] The federal range ratio is calculated by dividing the difference
between the 95th and 5th percentile of funding per WSU by the 5th
percentile. For example for ISEP funding per WSU: (3,902 - 3,733)/3,733
= .045 or 4.5%.
[B] For this analysis, total instructional funding includes ISEP
formula funds as well as funds for "Disadvantaged Children" (Title I),
Title II, Parts A & D, and Safe and Drug Free Schools and Communities,
(Title IV) funds, but not IDEA Part B funds.
[End of table]
The Elimination of Weights for Special Education from the ISEP Formula
Was Followed by a Large Reduction in the Number of Students Enrolled in
Special Education:
Students requiring special education are more costly to educate than
students who do not need such services. To account for this difference,
until recently, the ISEP formula used weights for severity of special
education needs of students and on disability and amount of time per
day spent in a special education program. Because such weights could
create an incentive to educate students in overly restrictive
environments, Education found BIA out of compliance with IDEA. To
comply with IDEA, BIA eliminated these weights and went to a different
method of financing the additional costs of special education in school
year 2002-03 in order to reduce the incentive to place students in
overly restrictive environments.[Footnote 37] It is too soon to assess
the impact this method had on the equity of the funding for special
education students, that is, whether this new system gives schools
sufficient funds to cover the costs of educating students with
disabilities. In the first year of the change, BIA reported about 3,000
fewer special education students than in the previous year, a 29
percent decline in special education enrollment. As can be seen in
figure 4, the percentage of students identified as needing special
education services had been increasing slightly since 1999 (the years
of this study). BIA officials said that a study was under way to
account for the large drop in special education enrollment.
Figure 4: Percentage of BIA Students Identified as Needing Special
Education Services, School Year 1999-2003:
[See PDF for image]
[End of figure]
The Transportation Formula May Not Account for Isolation:
Our analysis of the limited expenditure data (only BIA-operated schools
report their expenditures) showed that the current weighting scheme for
road conditions in the transportation formula seems appropriate, but
some cost factors may be missing. BIA uses two cost factors in this
formula: miles driven transporting students to and from school and road
condition. To capture the increased cost of transporting students on
very poor roads, BIA officials have assigned a weight of 1.2 for every
mile traveled on "unimproved" roads in the transportation formula.
While this formula may appropriately account for road conditions, there
are other relevant costs for BIA schools associated with degrees of
isolation. Isolation is included in BIA's formula for facilities
management, but not for transportation. In contrast, the transportation
formula used by New Mexico accounts for isolation by factoring in the
density[Footnote 38] of the school district. Not having an isolation
factor could result in schools receiving less in funding than they
incur in costs.[Footnote 39] Another noteworthy feature of New Mexico's
transportation funding is that it includes an incentive to promote
efficient use of funds (efficiency incentive). The efficiency incentive
allows schools to keep 50 percent of any unused transportation funds
for the following year. These funds can be used to cover transportation
services, including school activities such as field trips. BIA's
transportation formula does not offer any kind of efficiency incentive.
Other Formulas Calculate Funding Need That Exceeds the Current Funding
Level:
To determine funds needed to operate and maintain facilities, BIA
utilizes a comprehensive formula to project the dollar amount that
schools will need.[Footnote 40] BIA also determines an administrative
rate for the administration of the tribally operated schools under a
statutorily prescribed formula.While each of these formulas calculate a
dollar amount needed for each school, both programs are funded at about
80 percent of calculated need.[Footnote 41] While much has been done to
improve the reliability of the facilities data and to improve the
accuracy of projections, similar work has not been done to assess the
efficiency or accuracy of the administrative cost grant program. To
determine whether the administrative cost grants are underfunded, one
could conduct an efficiency study comparing the cost of administration
to industry standards of schools of similar size. However, BIA does not
currently collect any data about how the administrative cost grants are
used, which makes such a study problematic.
In the case of facilities maintenance, the formula projects amounts
needed by taking into account specific factors related to the cost of
maintaining the facilities. The backlog of maintenance for facilities
across BIA's system indicates a historic problem in funding levels. Our
previous study found that funding for the maintenance and repair of BIA
facilities was at the low end of national guidelines set forth by the
National Research Council and below rates recommended by experts in the
facilities field.[Footnote 42] However, since we did not study how
efficiently the schools were using the money allotted for facilities
maintenance and operations, we cannot draw conclusions about the
adequacy of the formula's projection or the appropriateness of funding
facilities maintenance at 80 percent of calculated need. We have noted,
however, that BIA is taking steps to improve the facilities maintenance
and operations program. In school year 2001-02, BIA budgeted $293
million to replace and renovate schools and is currently updating the
facilities database to ensure more reliable data.[Footnote 43]
With regard to the administrative cost grants for tribally operated
schools, we were unable to assess the effect of their having less than
100 percent of formula projected funds.[Footnote 44] The administrative
cost grant formula calculates an administrative rate related to program
cost to fund administrative duties such as payroll processing. In
school year 2001-02, this rate ranged from 12 percent to 38 percent of
program funds. As a percentage of calculated need, distributed funds
have decreased from 90 percent in school year 1998-99 to 72 percent in
school year 2002-03 (see table 7), a decline that was due to the
formula projections for increased costs without similar increases in
appropriations. However, without expenditure data, we are unable to
assess whether the calculated need is valid and the formula accurate.
Moreover, leaders of tribally operated schools can request more
administrative funds from another Interior source, but BIA officials in
the Office of Indian Education Programs did not know whether the tribes
used this option, or whether tribally operated schools had received
more for administration than they needed.
Table 7: Administrative Cost Grants--the Difference between Calculated
Need and Distributed Funds in Tribally Operated BIA Schools, School
Years 1998-99 through 2002-03 :
Calculated need; School year: 1998-99: $47,082,549; School year: 1999-
2000: $51,384,395; School year: 2000-01: $53,228,957; School year:
2001-02: $56,888,738; School year: 2002-03[A]: $59,708,500.
Distributed funds; School year: 1998-99: $42,160,000; School year:
1999-2000: $42,160,000; School year: 2000-01: $42,160,000; School year:
2001-02: $43,065,048; School year: 2002-03[A]: $43,065,048.
Distributed funds as a percentage of calculated need; School year:
1998-99: 90%; School year: 1999-2000: 82%; School year: 2000-01: 79%;
School year: 2001-02: 76%; School year: 2002-03[A]: 72%.
Source: BIA financial system.
[A] BIA has not yet issued the final administrative cost grant funds.
[End of table]
Evaluation of BIA Formulas for Adequacy Is Limited by the Lack of
Expenditure Data:
The lack of expenditure data limited our ability to fully evaluate the
formulas in terms of adequacy. While we were able to assess the
distributional equity of those used for instruction and transportation,
we were not fully able to assess whether the weighting schemes were
appropriate or whether they accounted for any intrinsic cost
differences that may exist among schools. For example, the ISEP formula
has weights for residency; we would need detailed expenditure data to
capture the costs of operating boarding schools on such items as after
school activities, increased food costs, counseling, and supervision
and to determine the appropriateness of the weights. Intrinsic
differences among schools could also be captured in expenditure data
that would reflect differences in pay scale for the tribally operated
schools according to region or degree of isolation, whether or not a
school provides housing for its teachers, and amounts spent on
recruitment or retention of staff. The presence of such differences in
cost could affect the services and resources available for each
student. OMB recommended to Interior that it develop academic
performance and cost-efficiency measures that are comparable to
similarly located public schools. Interior has agreed to implement this
recommendation.
Conclusions:
BIA schools contend with very high poverty rates, large numbers of
students with limited English proficiency, isolation, and many less
than adequate facilities, all of which are associated with the high
costs of education. While BIA's budgeted per-pupil funding exceeds the
national average PPE, PPEs at selected BIA schools appear to be on par
with that of selected public schools with similar characteristics. This
similarity, however, does not ensure adequacy. Although we did not do a
cost-effectiveness study, the funding allocated for transportation may
not have been sufficient, since some schools made up shortfalls by
spending money from funds primarily intended for instruction. It is
unknown how this shift of funds may have affected instruction, but in
an educational system characterized by higher than average costs for
instruction, the use of such funds for any other purpose seems
problematic. We could not make similar calculations to see how BIA
schools made up for any shortfalls in facilities operations or
administrative costs because these numbers were not available.
Because BIA does not collect complete expenditure data for two-thirds
of its schools that are tribally operated, it is difficult to determine
the overall adequacy of BIA's per-pupil funding other than by comparing
it to similar selected public schools, which is a limited measure of
adequacy. The expenditure data BIA collects does not reveal in detail
how funds are actually spent. For example, the current system does not
have data on how much was spent on components of instruction (teacher
and paraprofessional salaries, instructional materials, and computers)
or local administrative expenditures. Hence, Interior cannot use
expenditure data to formulate its budget requests. Moreover, what
expenditure data the agency does collect are not in categories that
would permit comparisons with public schools. However, Interior's
recent decision to implement an OMB recommendation to develop cost-
efficiency measures that are comparable to similarly located public
schools may capture some of these data. Similarly, any assessment of
the adequacy of distributional formulas would require expenditure data.
As to the removal of special weights for special education students
from the ISEP formula, Education found, and we concur, that this change
has reduced the incentive to place students in overly restrictive
environments. However, it is too soon to know the long-term effects on
resources available for educating children who require special
education.
Because it lacks an isolation factor in the transportation formula, BIA
may not be providing enough transportation funding for students who
live in remote areas. As a result, some BIA-operated schools may be
shortchanging instruction. In addition, the lack of an efficiency
incentive in the formula may limit opportunities for making the best
use of available resources.
Finally, because BIA does not identify and track the total amount of
overhead functions such as payroll, facilities management, and
procurement, we could not assess the total funding supporting the
administration of BIA schools. Moreover, without this information,
Interior cannot account for the full costs of administration of BIA-
operated schools as federal accounting standards require.
Recommendations:
To better assess BIA funding and formulas for their adequacy and to
ensure that budgeted funds are spent as intended and well managed, the
Secretary of the Interior should direct the Assistant Secretary for
Indian Affairs to collect expenditure data for the schools the agency
directly manages in greater detail so that the data can be compared
with public schools. For example, BIA should consider adopting the
expenditure classifications, particularly the function and object
codes, listed in Education's Financial Accounting for Local and State
School Systems, 1990.
To better assess BIA funding and formulas for their adequacy, the
Secretary of the Interior should also consider entering into
negotiations with tribal entities to acquire detailed expenditure data
for the schools they manage so they can compare it with public schools.
To improve the transportation formula so that it more accurately
reflects costs and encourages efficiency, the Secretary of Interior
should direct the Assistant Secretary of Indian Affairs to include an
isolation index and an efficiency incentive in addition to an
adjustment for road conditions.
To better manage Interior's funds, the Secretary of the Interior should
direct the Assistant Secretary for Indian Affairs to identify and
allocate all costs of administering BIA-funded schools, including the
costs of (1) administrative services provided by BIA to BIA-operated
schools and (2) central office services provided by headquarters and
regional offices.
Agency Comments:
We provided a draft of this report to the Departments of the Interior
and Education for their review and comment. Interior's comments are
provided in appendix III. In its written comments, Interior generally
agreed with our findings and recommendations.
Interior also made three comments on specific statements in our report:
(1) BIA asked for clarification of "regional agencies" and we added
that regional agencies are education line offices. (2) The second
comment referred to our statement that similar spending does not imply
adequate spending in the case of similar BIA and public schools and our
statement "because the BIA does not collect complete expenditure data,
we were limited in our ability to assess the overall adequacy of the
formulas." The former statement was a clarification that the graph
shows a comparison of spending at BIA and similar public schools and
that no conclusions should be drawn regarding adequacy of funding. In
contrast, the latter statement is specific to the adequacy of the
formulas used by BIA and does not have implications for the adequacy of
expenditures for public schools. (3) The third comment is about PPE
comparisons and has two parts. The first part states that the report
does not indicate what was included or considered as part of the PPE.
Table 4 identifies what was included in our definition. The second part
of the comment refers to the omission of a discussion about the
inadequate amount spent on facilities in the past. Although our report
indicates spending on facilities operations was more in the BIA-funded
schools we visited than in similar public schools, we also stated that
officials at 7 of the 8 BIA schools we visited rated their facilities
as fair to poor and complained about a long-standing lack of investment
in operation and repairs.
Education did not provide written comments but provided technical
comments that were incorporated as appropriate.
We are sending copies of this report to the Secretary of the Interior,
the Secretary of Education, relevant congressional committees, and
other interested parties. Please contact me on (202) 512-7215 or
Eleanor Johnson on (202) 512-7209 if you or your staff have any
questions about this report. In addition, the report will be available
at no charge on GAO's Web site at http://www.gao.gov. Other GAO
contacts and staff acknowledgments are listed in appendix IV.
Marnie S. Shaul,
Director:
Education, Workforce and Income Security Issues:
Signed by Marnie S. Shaul:
List of Congressional Committees:
The Honorable Judd Gregg
Chairman
The Honorable Edward Kennedy
Ranking Minority Member
Committee on Health, Education, Labor and Pensions
United States Senate:
The Honorable John A. Boehner
Chairman
The Honorable George Miller
Ranking Minority Member
Committee on Education and the Workforce
House of Representatives:
[End of section]
Appendix I: Scope and Methodology:
This appendix discusses in more detail the scope and methodology for
examining the funding and formulas used for funding Bureau of Indian
Affairs (BIA) schools.
Funding:
To determine the sources and amounts of federal funding for all BIA
schools, we reviewed BIA annual reports and budget justification
documents, the President's Budget, Office of Management and Budget
(OMB) reports, Department of Interior (Interior) appropriations
summaries, and Department of Education (Education) financial reports.
We talked with officials from Interior and Education. We conducted
interviews with BIA officials at headquarters and the Office of Indian
Education Programs in Albuquerque, New Mexico.
To determine how BIA school funding compares to national benchmarks, we
analyzed BIA financial databases and national public school expenditure
data from the Education's Core of Common Data (CCD) maintained by the
National Center for Education Statistics (NCES), which uses the
national average per-pupil expenditure (PPE) as an indicator of
education funding. The national average PPE is determined by taking the
total annual expenditures for all categories of current funding, except
capital funds and debt service, and dividing it by the average school
enrollment.[Footnote 45]
Because BIA does not maintain expenditure data on all of the schools it
funds, specifically, tribally operated schools, we compared BIA annual
budget allocations with national expenditures for the most recently
available school year 1999-2000 to get an overall PPE comparison,
excluding food. Similar to the PPE, the BIA per-pupil budget allocation
is calculated by dividing the total dollar amount of annual budget
allocations, excluding capital funds and debt service, by the student
enrollment.[Footnote 46] BIA does maintain some expenditure data for
the 32 day schools it directly operated in school year 1999-2000,
representing 13 percent of enrollment at BIA-funded schools, and we
were able to compare these schools with national school expenditures in
terms of instruction, transportation, facilities, and administration
for the same year.
We used budget and expenditure data from BIA's Financial Information
System (FIS). We assessed the reliability of these data by (1)
performing electronic testing for obvious errors in completeness,
accuracy, and consistency; (2) reviewing existing information about the
data and the system; and (3) interviewing agency officials
knowledgeable about the data and the system. We determined that the
budget data were sufficiently reliable for the purposes of this report.
However, as stated in the report, FIS only contains limited expenditure
data for the 32 BIA-operated day schools, which represent only 14
percent of the total BIA enrollment. We determined that these data were
sufficiently reliable for describing certain expenditure categories for
the 32 BIA-operated schools. We have discussed completeness issues
related to this data (including the lack of data on certain expenditure
categories and the lack of data on the tribally operated schools) in
the body of the report.
To determine how BIA school funding compares to that of similarly
situated schools, we selected 10 BIA and 10 public schools based on
location, school size, grade levels, relative isolation, and poverty
indicators. These BIA and public schools were selected to be similar as
a group; it was not a one-to-one match. We visited 9 public schools;
the tenth was unreachable because of weather. We dropped 1 public
school because it was not, in fact, similar and we dropped 2 other
public schools because they did not have complete data. In addition, 2
tribally operated BIA schools were eliminated because they could not
provide necessary data. The BIA-operated schools also could not provide
us with expenditure data. We obtained expenditure data for the 4 BIA-
operated schools we visited from the financial management system. We
obtained data from 8 BIA (4 tribally operated, 4 BIA-operated) and 6
public schools in Arizona, New Mexico, North Dakota, and South Dakota.
(See table 8.) These results are not generalizable to other BIA
schools. We selected these 4 states because they have 70 percent of the
BIA schools.
Table 8: BIA and Public Schools We Visited:
BIA-funded day schools:
School: BIA-1; State: Arizona; Type: BIA; Enrollment: 155.
School: BIA-2; State: New Mexico; Type: BIA; Enrollment: 246.
School: BIA-3; State: New Mexico; Type: BIA; Enrollment: 137.
School: BIA-4; State: New Mexico; Type: Tribal; Enrollment: 398.
School: BIA-5; State: New Mexico; Type: BIA; Enrollment: 261.
School: BIA-6; State: South Dakota; Type: Tribal; Enrollment: 368.
School: BIA-7; State: South Dakota; Type: Tribal; Enrollment: 42.
School: BIA-8; State: South Dakota; Type: Tribal; Enrollment: 668.
Similar public schools:
School: P-1; State: Arizona; Type: Public; Enrollment: 271.
School: P-2; State: New Mexico; Type: Public; Enrollment: 360.
School: P-3; State: New Mexico; Type: Public; Enrollment: 56.
School: P-4; State: South Dakota; Type: Public; Enrollment: 387.
School: P-5; State: South Dakota; Type: Public; Enrollment: 181.
School: P-6; State: North Dakota; Type: Public; Enrollment: 192.
Source: GAO analysis.
[End of table]
In these schools, we interviewed public school principals and cognizant
district officials, such as superintendents and business managers. We
obtained and reviewed budget and financial documents from these schools
and requested data from school officials regarding costs and issues
related to their (1) instruction and related activities, (2)
transportation, (3) facilities maintenance, and (4) administration in
school year 2002. We also interviewed BIA school principals and
business officials and a limited number of regional administrators who
directly oversee BIA schools.
With regard to disaggregated data, we are not able to isolate the total
amount of federal funding supporting the administration of BIA schools
because some overhead functions, such as payroll, facilities
management, and procurement, are handled regionally and the costs are
not consistently identified and allocated to the schools. However, we
did identify the administrative overhead that BIA reports for the
administrative cost grants and the regional administrators. In
addition, we found that BIA distributes administrative dollars
differently than public schools do and does not use accounting
categories that are nationally comparable. We adjusted the BIA data so
that program management (which includes principals' salaries) was
accounted for as an administrative, rather than as an instructional
expense.
Formulas--Overview:
Formulas can be evaluated in terms of their equity and their adequacy.
One notion of equity recognizes that students with similar
characteristics should be treated similarly in terms of funding. For
this measure of formula equity, the distribution of funds across
weighted student units (WSU) is used to determine whether the range of
differences in resources available to students is acceptable. There are
several measures of the equity of the distribution of educational
funds, including the federal range ratio. The federal range ratio would
have a value of zero if the distribution were completely equitable. To
evaluate the adequacy of a formula, one would assess how well the
formula reflects relevant cost factors, such as teachers' salaries, by
analyzing expenditure data. However, these data were not available or
available at the level of detail needed.
To determine how the various formulas were used to distribute funds and
how formula changes affected the funding of BIA schools, we conducted
several analyses. First, we analyzed distributive formulas for
instruction and transportation by determining the equity of the
distribution. In the case of the transportation formula, we also
compared the resulting distribution (budgeted amounts) to expenditures
for the BIA-operated schools that report expenditures. To determine how
well the Indian School Equalization Program (ISEP) formula and other
formulas distributed instructional funds, we examined the equity of the
distribution of such funds across pupils, WSU, and schools. In doing
so, we examined the amount of variation in per-pupil funding across
different categories of schools, such as size, control of school
(tribally or BIA-operated), whether the school has a boarding
component, and grades served by the school.
With regard to the facilities maintenance and operations formula and
the administrative cost grant formula, we describe the formulas but do
not evaluate their adequacy. It should be noted that at the time of the
study, the facilities formula was in flux. We compared the amounts
calculated by these two formulas to the amounts distributed by BIA for
their respective programs.
To determine the extent to which changes to the ISEP formula have
affected the funding of individual schools, we reviewed laws, as well
as school enrollment data and preliminary funding data, and existing
literature.
Formulas--Descriptions:
BIA uses six different formulas to distribute the majority of the
operational funds. Each formula is associated with a program or
function, such as instruction or transportation, and, each formula is
comprised of variables that are relevant to that program or function.
Ideally, any such set of formulas would work together to distribute
funds efficiently and fairly based on real cost components relevant to
the functions of the formulas.
ISEP Formula:
Formula details. The ISEP formula is BIA's primary formula for
distributing funds for instruction. ISEP funds are distributed to
schools based on WSU, or school enrollment adjusted for certain school
and student characteristics. The weighting scheme for the ISEP formula
recently changed, such that all weights based on special education
needs were eliminated. Prior to the change, the ISEP formula included
weights based on grade, bilingual designation, gifted and talented
classification, as well as exceptional child categories, which were
eliminated. The change in August 2002 increased all grade-based weights
by a factor of 15 percent. The ISEP formula also has weights for BIA's
residency program. The instructional weights and the residential
weights are in tables 9 and 10.
Formula distribution. The ISEP formula is a distributional formula. The
distribution of ISEP funds begins in July, when schools receive 80
percent of funds (calculated by using the prior year's enrollment).
Schools have a count week in September during which they determine
their current enrollment and the number of students requiring
exceptional education services. School administrators report their
average daily membership (ADM) to BIA. The education line officers
certify these counts. ISEP also has a small school adjustment that is
intended to help defray some costs associated with relatively small
schools whose enrollment is less than 50 ADM. Each small school
receives an additional 12.5 WSU. In addition, each school that has
between 50 and 100 ADM receives extra WSU as follows:
[See PDF for formula]
[End of formula]
After calculating the WSU for each school (including small school
adjustments), officials at BIA calculate the dollar amount per WSU by
dividing the amount appropriated for ISEP by the total number of WSU.
They then compute the amount that each school receives by multiplying
the total WSU for each school by the ISEP per WSU amount. The schools
then receive the difference between that product and the amount they
were given in July. The BIA disburses the final amount by December 1st.
Table 9: ISEP Formula Weights for the Instructional Program:
ISEP formula instructional programs:
Basic program:
Kindergarten;
Prior to August 2002: Base weight: 1.00;
Prior to August 2002: Add on weight: N/A;
Since August 2002: Base weight: 1.15;
Since August 2002: Add on weight: N/A.
Grades 1 to 3;
Prior to August 2002: Base weight: 1.20;
Prior to August 2002: Add on weight: N/A;
Since August 2002: Base weight: 1.38;
Since August 2002: Add on weight: N/A.
Grades 4 to 6;
Prior to August 2002: Base weight: 1.00;
Prior to August 2002: Add on weight: N/A;
Since August 2002: Base weight: 1.15;
Since August 2002: Add on weight: N/A.
Grades 7 to 8;
Prior to August 2002: Base weight: 1.00;
Prior to August 2002: Add on weight: N/A;
Since August 2002: Base weight: 1.38;
Since August 2002: Add on weight: N/A.
Grades 9 to 12;
Prior to August 2002: Base weight: 1.30;
Prior to August 2002: Add on weight: N/A;
Since August 2002: Base weight: 1.50;
Since August 2002: Add on weight: N/A.
Supplemental programs:
Intense bilingual;
Prior to August 2002: Base weight: N/A;
Prior to August 2002: Add on weight: 0.2;
Since August 2002: Base weight: N/A;
Since August 2002: Add on weight: 0.2.
Deaf: Gifted and talented;
Prior to August 2002: Base weight: Deaf: N/A;
Prior to August 2002: Add on weight: Deaf: 2 - base weight;
Since August 2002: Base weight: Deaf: N/A;
Since August 2002: Add on weight: Deaf: 2 - base weight[A].
Supplemental programs: Disabilities programs (full time – high
service):
* Deaf;
Prior to August 2002: Base weight: N/A;
Prior to August 2002: Add on weight: 3.00;
Since August 2002: Base weight: N/A;
Since August 2002: Add on weight: N/A.
* Blind;
Prior to August 2002: Base weight: N/A;
Prior to August 2002: Add on weight: 3.00;
Since August 2002: Base weight: N/A;
Since August 2002: Add on weight: N/A.
* Severely multi- handicapped;
Prior to August 2002: Base weight: N/A;
Prior to August 2002: Add on weight: 3.00;
Since August 2002: Base weight: N/A;
Since August 2002: Add on weight: N/A.
* Severely and profoundly retarded;
Prior to August 2002: Base weight: N/A;
Prior to August 2002: Add on weight: 3.00;
Since August 2002: Base weight: N/A;
Since August 2002: Add on weight: N/A.
* Hospital/ homebound instruction required;
Prior to August 2002: Base weight: N/A;
Prior to August 2002: Add on weight: 3.00;
Since August 2002: Base weight: N/A;
Since August 2002: Add on weight: N/A.
* Severely emotionally disturbed;
Prior to August 2002: Base weight: N/A;
Prior to August 2002: Add on weight: 3.00;
Since August 2002: Base weight: N/A;
Since August 2002: Add on weight: N/A.
* Emotionally disturbed;
Prior to August 2002: Base weight: N/A;
Prior to August 2002: Add on weight: 1.00;
Since August 2002: Base weight: N/A;
Since August 2002: Add on weight: N/A.
* Specific learning disabled;
Prior to August 2002: Base weight: N/A;
Prior to August 2002: Add on weight: 1.00;
Since August 2002: Base weight: N/A;
Since August 2002: Add on weight: N/A.
* Mentally retarded;
Prior to August 2002: Base weight: N/A;
Prior to August 2002: Add on weight: 1.00;
Since August 2002: Base weight: N/A;
Since August 2002: Add on weight: N/A.
Supplemental programs: Disabilities programs (full time – moderate
service):
* Emotionally disturbed;
Prior to August 2002: Base weight: N/A;
Prior to August 2002: Add on weight: 0.50;
Since August 2002: Base weight: N/A;
Since August 2002: Add on weight: N/A.
* Specific learning disabled;
Prior to August 2002: Base weight: N/A;
Prior to August 2002: Add on weight: 0.50;
Since August 2002: Base weight: N/A;
Since August 2002: Add on weight: N/A.
* Mentally retarded;
Prior to August 2002: Base weight: N/A;
Prior to August 2002: Add on weight: 0.50;
Since August 2002: Base weight: N/A;
Since August 2002: Add on weight: N/A.
* Multihandicapped;
Prior to August 2002: Base weight: N/A;
Prior to August 2002: Add on weight: 0.50;
Since August 2002: Base weight: N/A;
Since August 2002: Add on weight: N/A.
* Hard of hearing;
Prior to August 2002: Base weight: N/A;
Prior to August 2002: Add on weight: 0.25;
Since August 2002: Base weight: N/A;
Since August 2002: Add on weight: N/A.
* Visually handicapped;
Prior to August 2002: Base weight: N/A;
Prior to August 2002: Add on weight: 0.25;
Since August 2002: Base weight: N/A;
Since August 2002: Add on weight: N/A.
* Orthopedically impaired;
Prior to August 2002: Base weight: N/A;
Prior to August 2002: Add on weight: 0.25;
Since August 2002: Base weight: N/A;
Since August 2002: Add on weight: N/A.
* Other health impaired;
Prior to August 2002: Base weight: N/A;
Prior to August 2002: Add on weight: 0.25;
Since August 2002: Base weight: N/A;
Since August 2002: Add on weight: N/A.
* Speech impaired;
Prior to August 2002: Base weight: N/A;
Prior to August 2002: Add on weight: 0.25;
Since August 2002: Base weight: N/A;
Since August 2002: Add on weight: N/A.
Source: For the column entitled " Prior to August 2002 ISEP weights,"
the source was 25 C.F.R. 39.12, revised as of April 1, 2002. For the
column "Since August 2002 weights," the source was 25 C.F.R. 39.12 (e)
and (g) (1) and (2), revised as of April 1, 2003.
[A] For example, in school year 2002-03, a gifted and talented
kindergartener receives an add on weight of 2 - 1.15 = 0.85.
[End of table]
Table 10: ISEP Formula Weights for the Residential Program:
Basic program:
ISEP formula residential program: Basic program; Kindergarten; Prior to
August 2002: Add on weight: 0; Since August 2002: Add on weight: 0.
Grades 1 to 3; Prior to August 2002: Add on weight: 1.4; Since
August 2002: Add on weight: 1.4.
Grades 4 to 6; Prior to August 2002: Add on weight: 1.25; Since
August 2002: Add on weight: 1.25.
Grades 7 to 8; Prior to August 2002: Add on weight: 1.25; Since
August 2002: Add on weight: 1.25.
Disabilities programs (full time - high service): Grades 9 to 12; Prior
to August 2002: Add on weight: Disabilities programs (full time - high
service): 1.25; Since August 2002: Add on weight: Disabilities programs
(full time - high service): 1.25.
ISEP formula residential program: Disabilities programs (full time -
high service); All full-time handicapped students; Prior to August
2002: Add on weight: 0.5; Since August 2002: Add on weight: N/A.
ISEP formula residential program: Disabilities programs (part time -
moderate service); Mentally retarded; Prior to August 2002: Add on
weight: 0.25; Since August 2002: Add on weight: N/A.
Multihandicapped; Prior to August 2002: Add on weight: 0.25; Since
August 2002: Add on weight: N/A.
Emotionally disturbed; Prior to August 2002: Add on weight: 0.25;
Since August 2002: Add on weight: N/A.
Orthopedically impaired; Prior to August 2002: Add on weight: 0.25;
Since August 2002: Add on weight: N/A.
Intense residential guidance: Other health impaired; Prior to August
2002: Add on weight: Intense residential guidance: 0.25; Since August
2002: Add on weight: Intense residential guidance: N/A.
ISEP formula residential program: Intense residential guidance;
Prior to August 2002: Add on weight: 0.50; Since August 2002:
Add on weight: 0.50.
Source: For the column entitled "Prior to August 2002 ISEP weights ,"
the source was 25 C.F.R. 39.13, revised as of April 1, 2002. For the
column entitled "Since August 2002 weights," the source was 25 C.F.R.
39.13, revised as of April 1, 2003.
[End of table]
Student Transportation Formula:
Formula details. BIA uses a formula for the distribution of funds for
student transportation. The transportation formula itself is
straightforward. It distributes funds based on miles driven, weighted
by the road condition. Basically, improved miles get a weight of 1
while unimproved miles get a weight of 1.2. Improved roads are paved
roads or graded roads, including gravel roads. Unimproved roads consist
of those roads that are not graded, and not really maintained. (See
table 11.):
Formula distribution. Like the ISEP formula, the transportation formula
is purely distributive. The schools report to BIA the number of miles
driven in 1 day transporting students to and from school on improved
and on unimproved roads. BIA officials then calculate the total miles
for boarding schools and day schools as described in table 11.
Since some students live very far away from their schools or dorms,
they have to use planes, trains, or buses (other than school buses) to
get to school. BIA pays for two roundtrip tickets for such students
each school year. Therefore, the transportation costs for such students
are based on the costs of two roundtrip tickets (per school year).
Before calculating the per mile rate (based on school bus miles
driven), BIA officials first subtract any student transportation
expenses for airfare, charter buses, train fare, and bus fare from the
transportation allocation. The remainder of the transportation is
divided by the sum of day and boarding adjusted total miles, generating
a "per mile" rate. The transportation funds are then distributed to the
schools accordingly.
Table 11: Transportation Formula Weights with Examples:
Definition: Example 1: Standing Rock Community School; Improved miles
[M]: Number of miles driven on improved roads in 1 day: 1,346.8;
Unimproved miles [U]: Number of miles driven on unimproved roads in 1
day: 212.5; Adjusted total miles [T]: T = M + 1.2U: 1,346.8 +
1.2(212.5) = 1601.8; Total boarding miles: 4T: N/A[A]; Total day miles:
180T: 180(1601.8) = 288,324.
Definition: Example 2: Navajo Preparatory School[B]; Improved miles
[M]: Number of miles driven on improved roads in 1 day: 2,459;
Unimproved miles [U]: Number of miles driven on unimproved roads in 1
day: 17; Adjusted total miles [T]: T = M + 1.2U: 2,459 + 1.2 (17) =
2,479.4; Total boarding miles: 4T: 4(2,479.4)= 9917.6; Total day miles:
180T: N/A[A].
Source: GAO analysis.
[A] BIA day schools are in session and transport their students to and
from school 180 days per year. BIA boarding schools are in session 180
days, but need to transport their students to and from school only 4
times each year.
[B] This school is a boarding school with no day students that need
transportation. Many boarding schools have students who live at home in
addition to those who board.
[End of table]
Formula Used to Distribute "Safe and Drug Free Schools and Communities-
State Programs" (Title IV, Part A) Funds from Education:
Formula description. The formula used in the distribution of Title IV
funds has the same weights as those in the ISEP Base Program, that is,
weights based on the grade the student is in, with additional "add on"
weights for students who reside at one of the dorms or boarding schools
(see tables 9 and 10).
Formula distribution. Every school gets a base of $5,000. The rest of
the funds are distributed by WSU using only the basic grade--related
and basic residential weights. In other words, after giving each school
$5,000, BIA officials divide the rest of the funds by WSUs derived from
the base programs and obtain an amount per base WSU.
Formula Used to Distribute "Disadvantaged Children" (Title I) and Title
II, Parts A & D Funds from Education:
Formula description. Funds for these two programs are distributed
primarily based on enrollment, with adjustments made only for school
size. The adjustments for school size are different for the two
programs, but each one gives a larger base to smaller schools (see
tables 12 and 13). In the text of this report, the two programs were
treated as being distributed by one formula.
Formula distribution. After distributing the base amounts, BIA divides
the remaining funds by the total ADM and distributes the funds to each
school accordingly.
Table 12: Small School Adjustments for Disadvantaged Children (Title I)
Funds.
School enrollment: < 50; Base amount (Title I): $15,000.
School enrollment: 50 -