Order Code RL32085
CRS Report for Congress
Received through the CRS Web
Individuals with Disabilities Education Act (IDEA):
Current Funding Trends
Updated February 6, 2004
Richard N. Apling
Specialist in Social Legislation
Domestic Social Policy Division
Congressional Research Service ˜ The Library of Congress

---

Individuals with Disabilities Education Act (IDEA):
Current Funding Trends
Summary
The Individuals with Disabilities Education Act (IDEA) is the major federal
statute that supports special education and related services for children with
disabilities. This report traces recent funding trends for this program and tracks the
status of actions to “fully fund” the grants-to-states program under Part B of IDEA.
FY2004 total funding for IDEA is $11.2 billion. FY2004 funding for the Part B
grants-to-states program is nearly $10.1 billion. Since FY1996, funding for this
program has more than quadrupled. The FY2004 amount for the grants-to-states
program represents 18.6% of the estimated excess cost of serving children with
disabilities, which is approaching one-half of the amount necessary to “fully fund”
the program for FY2004.
The President’s FY2005 budget would increase overall funding for IDEA to
$12.2 billion, with funding for grants-to-states program increasing to nearly $11.1
billion. This amount would represent 19.7% of the estimated excess cost.
This report replaces CRS Report RS21447 and will be updated to reflect
congressional action on IDEA appropriations and to incorporate updated data for
excess cost calculations.

---

Contents
Recent Funding Trends . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
FY2005 Budget Request . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Estimated FY2004 and FY2005 State Grants . . . . . . . . . . . . . . . . . . . . . . . . 3
“Full Funding” of IDEA . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Background on “Full Funding” . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Relationship of Appropriations and Budget Request to
“Full Funding” . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
List of Tables
Table 1. IDEA Appropriations for Selected Fiscal Years (FY1996-FY2004) . . . 2
Table 2. IDEA FY2004 Appropriations and FY2005 Budget Request . . . . . . . . . 3
Table 3. Preliminary FY2004 and FY2005 IDEA Part B Grants-to-States
Allocations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Table 4. Estimation of “Full Funding” of IDEA Part B Grants to States
(FY1996-FY2005) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7

---

Individuals with Disabilities Education Act
(IDEA): Current Funding Trends
The Individuals with Disabilities Education Act (IDEA) is the major federal
statute that supports special education and related services for children with
disabilities. As a condition of accepting IDEA funding, the Act requires that states
and local educational agencies (LEAs) provide a free appropriate public education
(FAPE) to each eligible child with a disability. The IDEA is divided into four parts.
Part A contains the general provisions, including the purposes of the Act and
definitions. Part B, the most often discussed part of the Act, contains provisions
relating to the education of school aged (the grants-to-states program) and preschool
children (Section 619).1 Part C authorizes state grants for programs serving infants
and toddlers with disabilities,2 while Part D contains the requirements for various
national activities designed to improve the education of children with disabilities.
Part B is permanently authorized. Parts C and D are authorized through FY2003.3
Recent Funding Trends4
Table 1 shows recent trends in IDEA appropriations since FY1996. In this
period, overall IDEA funding has increased by nearly 250%, from $3.2 billion to
$11.2 billion. Most of the increases over this period have been for the grants-to-
states program, with its funding more than quadrupling since FY1996.5 Funding for
Parts C and D has increased more modestly — each increasing by about 40% since
FY1996. Funds for the preschool program (Section 619) have grown more slowly
since FY1996, with funding constant at $390 million for FY2000 through FY2002
and amounts slightly less than this amount for FY2003 and FY2004 due to general
across-the-board cuts in discretionary budget authority for those fiscal years.
1 Part B includes the funding formulas, provisions relating to evaluations, eligibility
determinations, individual educational programs (IEPs), and educational placements. It also
contains detailed requirements for procedural safeguards as well as withholding of funds and
judicial review.
2 Part C was originally established as Part H.
3 IDEA authorizes appropriations for Parts C and D programs and activities through
FY2002. These authorities were automatically extended for an additional fiscal year by the
General Education Provisions Act (GEPA — 20 U.S.C. 1226a).
4 All dollar figures are in current dollars; no price-level adjustments have been applied.
5 As a result of the rapid increase in grants-to-states funding, the share of total IDEA funding
for which this program accounts has also increased: from about 72% in FY1996 to nearly
90% in FY2003.

---

CRS-2
Table 1. IDEA Appropriations for Selected Fiscal Years (FY1996-FY2004)
(dollars are in $000)
Percent
change
IDEA
(FY1996-
program/activity
FY1996
FY1999
FY2000
FY2001
FY2002
FY2003
FY2004
FY2004)
Part B
grants to states
$2,323,837
$4,310,700
$4,989,685
$6,339,685
$7,528,533
$8,874,398
$10,068,106
333.25%
Part B
preschool grants
(Section 619)
$360,409
$373,985
$390,000
$390,000
$390,000
$387,465
$387,699
7.57%
Subtotal Part B
$2,684,246
$4,684,685
$5,379,685
$6,729,685
$7,918,533
$9,261,863
$10,455,805
289.52%
Part C
infants and
toddlers grants
$315,754
$370,000
$375,000
$383,567
$417,000
$434,159
$444,363
40.73%
Subtotal state
grants
$3,000,000
$5,054,685
$5,754,685
$7,113,252
$8,335,533
$9,696,022
$10,900,168
263.34%
Part D (total)
$245,415
$279,461
$281,511
$326,696
$337,271
$337,895
$338,664
38.00%
Total IDEA
$3,245,415
$5,334,146
$6,036,196
$7,439,948
$8,672,804
$10,033,917
$11,238,832
246.30%
Source: ED Budget Service spreadsheets.
Note: Totals may differ slightly due to rounding. All dollar figures are in current dollars; no price-level adjustments have been applied.

---

CRS-3
FY2005 Budget Request
Table 2 compares the FY2004 appropriations for IDEA with the President’s
FY2005 budget request. Overall funding for IDEA would increase by 8.3% under
the President’s budget, from $11.2 billion to $12.2 billion. Most of this increase is
the result of a 9.9% increase in the Part B grants-to-states program, which would
grow by $1 billion above the FY2004 amount. Part C state grants for infants and
toddlers would also increase (by 5%, from $444.4 million to $466.6 million).
Preschool state grants would be level funded. Total funding for Part D (national
programs and activities) would decrease by 25%. This decrease is due to the
proposed transfer of funding for research and innovation (Section 672), which is
funded at $78.1 million for FY2004, to the Institute of Education Sciences and a
17.4% reduction in funds for technology and media services (from $39.1 million in
FY2004 to $32.3 million).
Table 2. IDEA FY2004 Appropriations and FY2005
Budget Request
(dollars rounded to nearest $000)
Change
FY2005
from
IDEA program/activity
FY2004
request
FY2004
Part B grants to states
$10,068,106
$11,068,106
9.9%
Part B preschool grants
$387,699
$387,699
0.0%
(Section 619)
Subtotal Part B
$10,455,805
$11,455,805
9.6%
Part C infants and toddlers grants
$444,363
$466,581
5.0%
Subtotal state grants
$10,900,168
$11,922,386
9.4%
Part D (total)
$338,664
$253,715a
-25.1%
Total IDEA
$11,238,832
$12,176,101
8.3%
a. This amount reflects the proposed transfer to the Institute of Education Sciences of $78.1
million for research and innovation.
Estimated FY2004 and FY2005 State Grants
Table 3 shows estimated Part B grants-to-states allocations based on the
FY2004 appropriation and on the FY2005 request. The FY2004 estimates are
compared to states’ FY2003 grants. The FY2005 estimates are compared to the
FY2004 estimates. Increases in FY2004 estimated grants range from 12.1% to 15%.
FY2005 estimated increases range from 8.9% to 11.4%. For both FY2004 and
FY2005, the total amount for set-asides represents inflationary increases for Bureau

---

CRS-4
of Indian Affairs (BIA) schools, outlying areas, and the freely associated states6 and
level funding for evaluation.
Table 3. Preliminary FY2004 and FY2005
IDEA Part B Grants-to-States Allocations
(dollars rounded to nearest $000)
Preliminary
Percentage
Percentage
FY2005 grants
change from change from
Final FY2003
Preliminary
(based on
FY2003 to
FY2004 to
State
grants
FY2004 grants
FY2005 request)
FY2004
FY2005
Alabama
$143,066,000
$160,386,000
$175,143,000
12.1%
9.2%
Alaska
26,501,000
30,463,000
33,946,000
15.0%
11.4%
Arizona
132,563,000
152,382,000
169,803,000
15.0%
11.4%
Arkansas
85,906,000
97,196,000
106,691,000
13.1%
9.8%
California
933,124,000
1,072,637,000
1,189,078,000
15.0%
10.9%
Colorado
112,272,000
129,058,000
143,813,000
15.0%
11.4%
Connecticut
103,861,000
116,962,000
127,734,000
12.6%
9.2%
Delaware
24,288,000
27,920,000
31,112,000
15.0%
11.4%
District of
12,212,000
14,038,000
15,643,000
15.0%
11.4%
Columbia
Florida
479,525,000
551,219,000
611,289,000
15.0%
10.9%
Georgia
233,043,000
267,886,000
298,512,000
15.0%
11.4%
Hawaii
30,632,000
35,212,000
39,238,000
15.0%
11.4%
Idaho
41,226,000
47,389,000
52,741,000
15.0%
11.3%
Illinois
393,134,000
442,852,000
484,735,000
12.6%
9.5%
Indiana
200,791,000
226,545,000
247,651,000
12.8%
9.3%
Iowa
96,042,000
107,669,000
117,294,000
12.1%
8.9%
Kansas
84,072,000
94,250,000
103,082,000
12.1%
9.4%
Kentucky
122,827,000
137,697,000
150,006,000
12.1%
8.9%
Louisiana
142,508,000
163,815,000
182,543,000
15.0%
11.4%
Maine
43,047,000
48,258,000
52,572,000
12.1%
8.9%
Maryland
153,622,000
175,250,000
191,774,000
14.1%
9.4%
Massachusetts
223,317,000
250,351,000
272,731,000
12.1%
8.9%
Michigan
308,119,000
349,055,000
383,640,000
13.3%
9.9%
Minnesota
149,337,000
167,415,000
182,468,000
12.1%
9.0%
Mississippi
92,158,000
105,937,000
117,525,000
15.0%
10.9%
Missouri
178,701,000
200,334,000
218,242,000
12.1%
8.9%
Montana
28,125,000
32,189,000
35,522,000
14.5%
10.4%
Nebraska
58,742,000
65,854,000
71,740,000
12.1%
8.9%
Nevada
49,853,000
57,306,000
63,858,000
15.0%
11.4%
New
37,334,000
41,854,000
45,595,000
12.1%
8.9%
Hampshire
New Jersey
284,356,000
318,780,000
347,276,000
12.1%
8.9%
6 The recent practice of the U.S. Department of Education (ED) has been to increase funding
for outlying areas and the freely associated states by the rate of inflation. Recent
appropriations language (including language in the Consolidated Appropriations Act, 2004
— P.L. 108-199) limits increases in BIA funding under IDEA to the rate of inflation.

---

CRS-5
Preliminary
Percentage
Percentage
FY2005 grants
change from change from
Final FY2003
Preliminary
(based on
FY2003 to
FY2004 to
State
grants
FY2004 grants
FY2005 request)
FY2004
FY2005
New Mexico
71,699,000
80,812,000
88,360,000
12.7%
9.3%
New York
597,208,000
669,506,000
729,354,000
12.1%
8.9%
North Carolina
235,924,000
270,052,000
296,306,000
14.5%
9.7%
North Dakota
19,722,000
22,670,000
25,262,000
15.0%
11.4%
Ohio
344,364,000
393,358,000
432,841,000
14.2%
10.0%
Oklahoma
116,368,000
130,941,000
143,655,000
12.5%
9.7%
Oregon
100,991,000
115,214,000
126,490,000
14.1%
9.8%
Pennsylvania
336,056,000
378,003,000
415,337,000
12.5%
9.9%
Puerto Rico
81,033,000
93,148,000
103,797,000
15.0%
11.4%
Rhode Island
34,402,000
38,567,000
42,014,000
12.1%
8.9%
South Carolina
137,797,000
154,478,000
168,434,000
12.1%
9.0%
South Dakota
23,494,000
27,006,000
30,094,000
15.0%
11.4%
Tennessee
181,996,000
205,284,000
224,938,000
12.8%
9.6%
Texas
725,934,000
834,470,000
929,869,000
15.0%
11.4%
Utah
81,887,000
94,088,000
103,569,000
14.9%
10.1%
Vermont
19,016,000
21,859,000
24,358,000
15.0%
11.4%
Virginia
214,099,000
244,634,000
267,955,000
14.3%
9.5%
Washington
170,259,000
195,689,000
215,373,000
14.9%
10.1%
West Virginia
59,745,000
66,978,000
72,965,000
12.1%
8.9%
Wisconsin
163,780,000
183,608,000
200,391,000
12.1%
9.1%
Wyoming
19,949,000
22,932,000
25,553,000
15.0%
11.4%
Subtotals to
$8,740,029,000
$9,931,456,000
$10,929,915,000
13.6%
10.1%
states
Total set-asides
$134,369,000
$136,650,000
$138,192,000
1.7%
1.1%
Totals
$8,874,398,000 $10,068,106,000
$11,068,106,000
13.5%
9.9%
Source: CRS calculations based on data obtained from the U.S. Department of Education (ED) Budget
Service.
Note: Totals may differ slightly due to rounding. FY2004 and FY2005 grants are estimates only and
do not necessarily represent amounts states and other entities will eventually receive. These amounts
are provided for the purpose of policy discussion only.

---

CRS-6
“Full Funding” of IDEA
Background on “Full Funding”. When Congress enacted the predecessor
legislation to IDEA7 in 1975, the available estimate of the cost of educating children
with disabilities was, on average, twice the cost of educating other children. A
determination was made that the federal government would pay some proportion of this
additional or “excess” cost. The metric for determining this excess cost was the
national average per pupil expenditure (APPE). The final determination was that the
federal government would pay up to 40% of this excess cost. That is, a state’s
maximum grant under the grant-to-states program is 40% of APPE times the number
of children with disabilities served. (See Section 611(a)(2) of IDEA.)
Relationship of Appropriations and Budget Request to “Full
Funding”. Although appropriations for IDEA Part B grants to states have increased
significantly over the last 9 years, funding still falls short of the amount that would be
necessary to provide maximum grants to all states. Table 4 shows estimated
percentages of excess cost since FY1996. The 5th column of the table shows the
estimated excess cost, that is, the number of children with disabilities served times the
national APPE. The 4th column shows the estimated amount needed to “fully fund”
IDEA, that is 40% of the figures in the final column. The calculation of the percentage
of excess cost included in the appropriation (the 3rd column) is obtained by dividing the
appropriation (column 2)8 by the last column. The FY2004 amount (accounting for
18.6% of the estimated excess cost), is approaching one-half of the funds necessary to
reach 40% of estimated excess cost and thus represents about one-half of the amount
that would be needed to “fully fund” IDEA for FY2004. The President’s budget
request would account for 19.7% of estimated excess cost — nearly one-half of the
current “full funding” estimate for FY2005.
It is important to note that the estimates of excess cost (and thus of the “full
funding” amount) tend to increase from year to year. That is because the Budget
Service of the U.S. Department of Education (ED), which is the principal source of
estimates, increases its estimates of the number of children with disabilities each year
and increases the estimated APPE by an inflation adjustment.
7 Federal special education legislation existed prior to 1975 — most notably the Education
of the Handicapped Act (EHA). P.L. 94-142 (the Education for All Handicapped Children
Act of 1975) substantially amended the EHA, creating the essential structure and principles
of federal assistance to special education that are still reflected in current law. In 1990, the
name of the Act was changed to the Individuals with Disabilities Education Act by P.L. 101-
476. Congress made extensive amendments to IDEA in 1997 (P.L. 105-17); however the
basic characteristics of the Act resemble those first enacted in 1975.
8 Note that funds for evaluations and studies are excluded from these calculations for
FY1998 and succeeding fiscal years.

---

CRS-7
Table 4. Estimation of “Full Funding” of
IDEA Part B Grants to States (FY1996-FY2005)
Actual and
Appropriations
proposed
Estimated federal
for IDEA Part B appropriations as full funding (40%
Estimated
grants to states
% of estimated
of excess cost)
excess cost
FY
(in $000)
excess cost
(in $000)
(in $000)
1996
$2,323,837
7.30%
$12,699,024
$31,747,560
1997
3,107,522
9.20%
13,460,630
33,651,576
1998
3,801,000
10.50%
14,457,195
36,142,988
1999
4,301,000
11.10%
15,445,347
38,613,368
2000
4,976,685
12.00%
16,641,158
41,602,894
2001
6,323,685
14.10%
17,882,114
44,705,286
2002
7,512,533
15.45%
19,446,407
48,616,017
2003
8,858,398
17.08%
20,740,029
51,850,073
2004
10,052,106
18.65%
21,563,790
53,909,474
2005 request
11,052,106
19.74%
22,398,228
55,995,570
Source: Table prepared by Congressional Research Service (CRS) from U.S. Department of Education
data.
Note: FY1998-FY2005 funds exclude amounts for studies and evaluations. Estimates of full funding
amounts and percentages of APPE will change for any fiscal year for which ED revises data to calculate
these estimates.

---