COVID-19 update for K-12: The CARES Act and potential GASB changes
The CARES Act provides $13.5 billion in stabilization funding to states in support of elementary and secondary education programs, which are expected to be distributed based on current Title I program funding allocations. GASB deadlines may also be extended.
How much funding will states and K-12 school districts receive?
The CARES Act provides $13.5 billion in stabilization funding to states in support of elementary and secondary education programs. Funding will likely be distributed based on current Title I program funding allocations. State governors will also share in a $3 billion allocation to use for K-12 and higher education at their discretion.
Other portions of the CARES Act include shared funding, which will be impactful to K-12 districts, but as to what extent is still unclear. This funding includes:
- $15.5 billion for USDA Nutritional Assistance Programs.
- $8.8 billion for nutrition programs for kids when school isn’t in session.
- $750 million for Head Start Programs.
- $100 million for Project SERV for assistance in cleaning and disinfecting schools, mental health services, and distance learning.
Are there any new programs being funded?
It appears funding will run through programs already established.
Will there be additional compliance requirements related to funding?
The Act doesn’t include this information, however, if a school district receives additional dollars, it may trigger the single audit threshold of $750,000 and/or require compliance audit testing. If your district receives additional funding, make sure you know exactly what the compliance requirements are. You might need to establish a system to collect and track the data.
Our single audit experts are evaluating the implications for K-12, and we’ll provide more guidance as information is released.
Possible postponement of certain GASB standards
The GASB issued a press release about a potential delay of certain GASB standards. A fast-tracked project will consider the postponement of all Statement and Implementation Guide provisions with an effective date that begins on or after reporting periods beginning after June 15, 2018. This would include both Statement 84, Fiduciary Activities, and Statement 87, Leases, along with the related Implementation Guides. The project, if approved, is expected to result in an exposure draft in April 2020, with a final standard to be issued in June 2020.
Many school districts are well on the path to implementation of Statement 84. It may still make sense for your district to continue moving forward in implementing for the June 30, 2020 year.