Texas Education Agency Skip to Main Content
   Home | District Locator | Index A-Z | Divisions | School Directory
  SEARCH   Administrators   Teachers   Funding   Testing/Account   Curriculum   Reports   News   ARRA

TEA Correspondence

A Microsoft Word version of this letter is available for download and PRINTING.

June 27, 2007


Subject: Compensatory Education Allotment Alternative Funding

House Bill 2879 and Senate Bill 702, 77th Regular Legislative Session, amended the Education Code to provide an alternative state compensatory education allotment funding count for school districts and open-enrollment charter schools that do not participate in the national school lunch or breakfast programs (see Texas Education Code §42.152(b) as amended).  The law allows the commissioner to adopt a counting method and rules for this alternative.  The rules for the program can be found on the TEA web site at http://www.tea.state.tx.us/school.finance/funding/altcomped.html.

You have received this letter because you are a charter school or because our records indicate that your district did not participate in the national school lunch or breakfast programs.  This letter and pertinent documentation is provided to you based on this information. 

Eligibility Guidelines

Under rules adopted by the commissioner, the count of students used for the alternative funding procedure will be those students that would otherwise be eligible for the lunch program, if it were offered.  School districts or charter schools that do not offer the national programs must apply the same income qualification procedures as are used in the national programs in order to establish the number of eligible students for those programs.  The qualification information for each child must be retained for audit purposes.  The counts of eligible students must be recorded each month and reported to the Texas Education Agency, and changes in family income status through the year may affect whether a student remains or becomes eligible for this funding count. 

In general, students in families that receive food stamps or Temporary Assistance for Needy Families (TANF) automatically qualify for the funding count, and districts can satisfy the documentation requirements by recording the appropriate case numbers.  Students in families that do not receive such assistance may qualify if they are in families that meet the same income guidelines as are used for the school lunch and breakfast programs.  The income guidelines are a function of family size and total income of all family members.  The table entitled ‘2007-08 Income Eligibility Guidelines’, which can be found on the TEA web site athttp://www.tea.state.tx.us/school.finance/funding/altcomped.html, shows the maximum income for a given family size. 

Data Collection

To assist districts and charter schools with gathering the proper income eligibility information for families, the following documents have been posted to the TEA web site at http://www.tea.state.tx.us/school.finance/funding/altcomped.html:

  • A sample Letter to Households to Qualify the District for Compensatory Education Funding (both English and Spanish versions available)
  • Form for Compensatory Education Funding Qualification (both English and Spanish versions available)
  • Instructions for the Compensatory Education Funding Qualification (both English and Spanish versions available)
  • Basic Monthly Claim Form

The letter to households explains the need for personal income data.  The standard form for qualification and the related instructions should provide sufficient direction to parents or heads of households to report the necessary information.  Upon receipt of the forms, school district or charter school personnel must make a determination in each case of the qualifications of the applicant for funding.  Relevant fields at the bottom of the form must be completed and the form must be retained for audit purposes.  Each of these documents may be customized with the district’s identifying information. 

The ‘Basic Monthly Claim’ document is the data collection instrument that must be returned to the TEA State Funding Division in order to receive funding.  This claim form requires only aggregated counts of eligible students in each month.  Note that districts and charter schools must review records monthly to determine if the students are still enrolled and whether family income status has changed.  This monthly form must be submitted by the 15th of each month with the prior month’s student count.  For example, the claim form for October will be due on November 15th. 

Funding for 2008-09

The entities that can report data under this method are those that will not participate in the national lunch or breakfast programs in the 2007-08 school year.  The highest six-month average of data collected from the 2007-08 school year will be used to fund the State Compensatory Education program in the 2008-09 school year, as is the case for school districts and charter school that operate lunch or breakfast programs.  Open enrollment charter schools that will begin operations in 2007-08, assuming they choose not to provide the lunch or breakfast programs, will be allowed to use the 2007-08 data for State Compensatory Education funding in the 2007-08 and 2008-09 school years.   

District Responsibilities

Districts and open-enrollment charter schools that receive the alternative compensatory education allotment are responsible for obtaining the appropriate data from the families of potentially eligible students, verifying the information, and retaining records.  The agency will conduct an audit of the data submitted by districts and charter schools.  As a result, records should be retained for a minimum of five years after the end of each school year.


Please contact Nora Rainey or Kathryn Jones in the State Funding Division at (512) 463-9238 if you have questions about this matter.


Lisa Dawn-Fisher, Director
School Finance

TEA Homepage

Back to TEA Correspondence Homepage

Texas Education Agency
1701 N. Congress Avenue
Austin, Texas, 78701
(512) 463-9734
Map | Site Policies | TEA Jobs
Fraud Hotline
Compact with Texans
Open Records Requests
Frequently Asked Questions
State of Texas
Texas Legislature
Homeland Security
Military Families
Where Our Money Goes
Equal Educational Opportunity
Governor's Committee on People with Disabilities
Copyright Texas Education Agency (TEA) 2007-2012