Under maintenance of effort—or MOE, in wonky Washingtonspeak—states can't cut their own education spending below whatever amount they spent the previous year and still tap federal dollars for special education under the Individuals with Disabilities Education Act, unless they get special permission from the department.
Keeping up special education spending is usually not a problem for states, but it became an issue during the recent budget recession.
The most prominent example by far? South Carolina, which has actually sued the Education Department in connection with this issue. The department withheld $36 million in special education funding from the Palmetto State last October. And that reduction was slated to stay in place permanently, until Congress and the administration intervened.
The Obama administration and lawmakers on Capitol Hill, including U.S. Sen. Tom Harkin, D-Iowa, the chairman of the panel that oversees education spending, added a provision to the recent spending legislation clarifying that while states that are out of compliance with the law will still see their funding reduced, that cut won't be in place in permanently. Instead, the reduction would just be for the year (or years) that the state was out of compliance and didn't get a waiver. Once the problem had been fixed, the state could go back to its regular spending levels.
The new provision goes on to explain that the reduced funding would still go to IDEA, just not to the offending state. Any money that's taken away from a state that doesn't keep up its end of the spending bargain would be split among states that do, as a kind of bonus. But states that get the extra funds would have to understand that this would be a one-time thing—they wouldn't be able to count on the extra funding forever.