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Luetkemeyer: Feds Back Off Crippling Accounting Regulation on Career Centers

Press Release

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Date:
Location: Washington, DC

In a victory for Missouri's school districts and their affiliated career centers, U.S. Rep. Blaine Luetkemeyer (MO-9) today announced that the U.S. Education Department has notified Missouri superintendents that they will not be required to undergo the costly and burdensome process of changing their accounting practices in order to continue being eligible for Title IV federal financial aid.
Luetkemeyer confirmed that Education Department letters detailing the agency's decision had gone to the affected school districts and career centers this week.

"I want to thank my colleagues in the congressional delegation, federal education officials and most importantly the hard-working folks in our school districts and career centers for working so diligently in successfully preventing these critical institutions from being saddled with burdensome, unnecessary expenses that would have caused many schools to drop their adult programs." Luetkemeyer said. "While we will continue to monitor the situation to ensure this issue does not become a problem in the future, this was a hard-earned victory and one we can be proud of."

Since 1997, a federal regulation has stipulated that postsecondary education institutions applying for Title IV funds must submit annual financial statements to the Department of Education prepared on an accrual basis, a method of accounting. Until recently, the Department of Education had allowed Missouri career centers to operate under their current reporting system -- cash accounting. Missouri is unique from many states in that many of its career centers are part of local school districts.

Led by Luetkemeyer, Missouri's congressional delegation has argued that since the cash basis of accounting has traditionally been used in federal budgeting, it should be comprehensive enough to be used for Missouri school districts. A Government Accountability Office report said that the cash basis of accounting is a "widely used and accepted measure of the government's effect on current financial markets."

During the lengthy discussions on the issue, Luetkemeyer's fears about the impacts of the regulations were realized when at least two schools decided to no longer offer adult programs and one school district decided not to apply for Title IV funds, which means students wouldn't have the opportunity to receive federal financial aid. An example of the importance of Missouri career centers is that each year they turn out an average of 500 licensed practical nurses, or LPNs.


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