Do School Districts have obligations regarding their use of ESSER funds after final program closeout?
Yes. Federal regulations require school districts to retain information about their use of ESSER funds and report on their use of ESSER funds for several years after the end of the ESSER program. Below are some of the requirements that school districts need to be aware of given recent audit findings and federal guidance.
ESSER Data Collection
Federal ESSER Data Collection is a responsibility for districts with ESSER expenditures in the reporting fiscal year. (2 CFR 200.329)
- Grantees will have to report on ESSER-funded expenditures and activities that occurred during 7/1/23 - 6/30/24 in spring of 2025 and expenditures and activities that occurred during 7/1/24 - 9/30/24 in spring of 2026.
- While data elements are chosen by the U.S. Department of Education, we anticipate that, at minimum, districts will be expected to report to ODE:
- Participation data for specific activities that used any ESSER funds (summer school, after school, extended day, tutoring, and early education activities, as well as use of technology purchased with ESSER funds)
- ESSER-funded staffing
- Use of funds information
Equipment (Capital and Non-Capital)
NOTE: Equipment purchased with federal funds can be retained for use for the same purpose (i.e., activities that meet the intent of the federal award) beyond the performance period.
All equipment:
Inventory (here is a link to an inventory template) of equipment purchased with federal grant funds, including program use, must be kept on file; if inventory was sold, must include verification that, and, if applicable, funds returned to federal entity if it has not been disposed.
Equipment with a purchase value greater than $5,000 per unit must be tracked, maintained and inventoried per federal regulation 2 CFR 200.312 and must be done once every two years at least throughout the record retention period, discussed below. Equipment includes but is not limited to vehicles, non-permanent structures (such as playground equipment or sheds), security systems, HVAC equipment, and modular buildings, as well as other more commonly recognized items.
Inventory (2 CFR § 200.313(d))
Equipment purchased with federal grant funds must be kept on file. Federal inventory requirements are detailed. Please see the Title 2 regulation or ODE’s sample template for required elements, if equipment is no longer in use, the inventory must include disposition information and, if applicable, funds returned to the federal entity. For items considered highly walkable and non-capital, such as Chromebooks, laptops, small printers etc., it is best practice to continue to track and inventory those items as well. Inventory must be maintained that include a description of:
- The property
- A serial number or other identification number
- The source of funding for the property (including the FAIN)
- Who holds title
- The acquisition date, and cost of the property
- Percentage of Federal participation in the project costs for the Federal award under which the property was acquired
- The location, use and condition of the property
- Ultimate disposition data, including the date of disposal and transfer receipt or sale price of the property (2 CFR 200.313(d))
Note: if an entity's internal process has an EQUIPMENT threshold of LESS than the federal threshold of $5,000, the entity will apply these requirements to their threshold. For items considered highly walkable and non-capital, such as Chromebooks, laptops, small printers etc., it is best practice to continue to track and inventory those items as well.
Use/Disposal (2 CFR § 200.313)
If equipment is transferred to another school or location within the entity, priority must be given to programs funded by the federal government. If the physical location (school) changes, receipt of the transfer must be provided to LEA and retained. A transfer receipt must be created to include the following information: original location, new location, transfer date, details of the transferred item including item valuation (FMV), serial number, program under which the item was purchased, and signatures of employees with signature authority to do so.
If equipment was stolen, a copy of the police report and insurance claim, supporting valuation documentation (FMV), and final disposition method (e.g., lost, stolen, damaged, replaced, etc.) must be maintained.
If equipment ($5,000 per item per 2 CFR 200.33, or the entity's internal threshold, whichever is lower) should need to be disposed of, please refer to this document or contact ODE’s ESSER Team for further instructions.
Supplies and Consumables
The disposition of unused (means supplies that are in new condition, not having been used or opened before) or residual supplies purchased with Federal grant funds, with a total aggregate current fair market value exceeding $5,000, at time of closeout, must be documented (2 CFR 200.314). If the supplies are not needed for any other Federal award, and the current Fair Market Value is greater than $5000, the non-Federal entity must retain the supplies for use on other activities or sell them, but must, in either case, compensate the Federal Government for its share. If the current fair market value is greater than $5000, the amount of compensation must be computed in the same manner as for equipment. See § 200.313 (e)(2) for the calculation methodology. If sold or transferred, a copy of this sale or transfer of supplies must be maintained in the LEA’s grant records along with support documenting the current Fair Market Value calculation of remaining supplies. Note: If the value of all unused supplies when totaled does not meet or exceed $5,000, grantee will indicate this in the LEA’s grant records, and no further obligation exists.
Real Property (2 CFR 200.311, 2 CFR 200.330)
Real property is defined as land, land improvements, structures and appurtenances (driveways, ditches, fences, rights of way). This category includes any facilities that were constructed, renovated, remodeled, or otherwise improved using federal grant funds.
Recording (2 CFR § 200.316)
ESSER requirements include recording a “Notice of Federal Interest” in projects that improved an individual building at $1,000,000 or more by January 28, 2025. Link to letter from USDOE: https://oese.ed.gov/files/2024/05/DCL-and-Guidance-Recording-and-Reporting-Federal-Interest-4.2.24-with-corrections.pdf
Reporting (2 CFR § 200.330)
ESSER requirements include annual reporting on all real properties with in which the Federal government has made a monetary investment for a minimum of 15 years (2 CFR § 200.330). Link to letter from USDOE: https://oese.ed.gov/files/2024/05/DCL-and-Guidance-Recording-and-Reporting-Federal-Interest-4.2.24-with-corrections.pdf
Financial records, supporting documents, statistical records, and all other non-Federal entity records pertinent to the ESSER grants must be retained for a period of three years from the date of submission of the final report, which is likely to be in Spring 2026.
Monitoring
School districts need to continue to engage in compliance activities identified in all Programmatic Monitoring, Fiscal Monitoring and Contracted Project Monitoring final reports.