Tuition Billing Reference Guide 2024

1 | Page Updated December 2023 Tuition Billing Reference Guide

Tuition Billing Reference Guide

Division of School Finance

400 NE Stinson Blvd.

Minneapolis, MN 55413

651-582-8779

Minnesota Department of Education website

(https://education.mn.gov)

Special Education Funding and Data Team

(mde.spedfunding@state.mn.us)

December 2023

Minnesota Department of Education

2 | Page Updated December 2023 Tuition Billing Reference Guide

Table of Contents

Tuition Billing Reference Guide .............................................................................................................................................. 1

ble of Contents

................................

................................................................................................................................ 2

Tuition Billing Overview ...................................................................................................................................................... 5

tudent Acknowledgements

................................

........................................................................................................... 6

taff Communication and Fiscal Year Cycle

................................

........................................................................................ 6

idpoints to Determine Special Education Services Hours

................................................................................................ 9

eans by Disability and Instructional Setting

................................................................................................................ 9

eporting Special Education Service Hours

...................................................................................................................... 10

Bas

ic Reporting Rules for Special Education Service Hours in MARSS

.......................................................................... 10

ndirect Special Education Services and MARSS Reporting

.......................................................................................... 11

xample 1 – Preschool

............................................................................................................................................. 11

Example 2 – Inclusive Classroom ............................................................................................................................. 11

xample 3 – Cooperative Teaching

.......................................................................................................................... 11

Special Education Instructional Settings ........................................................................................................................... 12

nstructional setting for students ages 6-21:

................................................................................................................ 12

Case Manager and MARSS Contact ............................................................................................................................... 12

alculating the Instructional Setting

............................................................................................................................. 13

xample 1 – Resource Room

.................................................................................................................................... 13

xample 2 – Resource Room

.................................................................................................................................... 13

xample 3 – Self-Contained Classroom

................................................................................................................... 14

nclusive, Multidisciplinary and Cooperative Teaching

..................................................................................................... 14

Tea

m Teaching

.............................................................................................................................................................. 14

nclusive Instructional Setting

....................................................................................................................................... 14

ultidisciplinary Teaching Mode

l ................................................................................................................................. 15

Minnesota Department of Education

3 | Page Updated December 2023 Tuition Billing Reference Guide

Cooperative Teaching Model ........................................................................................................................................ 15

Allo

cating Salaries for Special Education Staff .................................................................................................................. 15

porting One-To-One Paraprofessionals ........................................................................................................................ 16

porting One-to-One Service Hours – Nonresident Students ........................................................................................ 17

porting One-to-One Professionals, Contracted Services, Contracted Student Placements and Equipment ............... 18

Org

anization-Site Rates ..................................................................................................................................................... 20

Org-S

ite Rate Calculation Example ............................................................................................................................... 21

dget/Expenditure Adjustment Procedures for Org-Site Rates ..................................................................................... 22

structions for Entering Org-Site Data in SEDRA ......................................................................................................... 22

“U

nreimbursable” Nonfederal Special Education Costs ................................................................................................... 24

Care

and Treatment – Students in Transition ................................................................................................................... 24

Private Care and Treatment Programs ............................................................................................................................. 25

Early

Childhood Initial Evaluations and the Bill Back Process ........................................................................................... 26

Extended School Year Services – Reporting in MARSS and SEDRA ................................................................................... 27

arning Year and Extended School Year (ESY) ................................................................................................................ 28

ckground ................................................................................................................................................................... 28

MAR

SS Reporting Procedure ........................................................................................................................................ 29

arning Year and SEDRA .............................................................................................................................................. 29

sues When Tuition Billing Does Not Cover Costs for LEAs ............................................................................................. 30

ition Appeal Rates ......................................................................................................................................................... 30

peal Process and Procedures .................................................................................................................................... 31

ing Federal Funds for Tuition Payments ....................................................................................................................... 32

ARS Procedures – Using Federal Funds for Tuition Bill Costs ................................................................................... 32

Rep

orts on Minnesota Department of Education Website .............................................................................................. 32

Special Education Tuition Billing District Calculation .................................................................................................... 33

ecial Education Tuition Billing Billable Students from MARSS – Regular School Year/Extended School Year.......... 34

Minnesota Department of Education

4 | Page Updated December 2023 Tuition Billing Reference Guide

Special Education Tuition Billing Regular/Extended School Year Rate Calculation (Rates by Disability) ..................... 35

ection A ................................................................................................................................................................... 35

ection B – Regular School Year ............................................................................................................................... 35

ection C – Regular School Year by Disability ......................................................................................................... 36

ll Disabilities – Districtwide Rates ......................................................................................................................... 36

ection D – Extended School Year ........................................................................................................................... 36

ection E – Extended School Year by Disability ....................................................................................................... 37

ll Disabilities – Districtwide Rates ......................................................................................................................... 37

ummary ................................................................................................................................................................... 37

pecial Education Tuition Billing Organizational-Site (Org-Site) Rate Calculation – Regular School Year .................... 37

ection A ................................................................................................................................................................... 38

Section B – Regular School Year ............................................................................................................................... 38

ection C – Regular School Year by Org-Site ........................................................................................................... 38

All Sites – Districtwide Rates.................................................................................................................................... 38

pecial Education One-to-One Paraprofessionals Hours Comparison ......................................................................... 39

ppendix A – Guide to Tuition Invoice Data Extract from SEDRA .................................................................................... 40

ote: This document is provided to schools for guidance with the tuition billing system.

For further information or if you have questions, please contact the Special Education Funding and Data Team

(mde.spedfunding@state.mn.us).

Minnesota Department of Education

5 | Page Updated December 2023 Tuition Billing Reference Guide

Tuition Billing Overview

Effective Fiscal Year (FY) 2007, the Minnesota Department of Education (MDE) assumed the responsibility for

calculating state special education aid adjustments for students with Individualized Education Programs (IEPs)

that are served in other than their resident district (Minnesota Statutes, sections 125A.11 and 127A.47). During

the regular school year, if the student is reported in the Minnesota Automated Reporting Student System

(MARSS) with a Special Education Evaluation Status (SEES) 4 or 6, and the student is a nonresident of the serving

district, the MDE Tuition Billing System will invoice the resident district for the unreimbursed costs for providing

special education services, special education transportation and the general education revenue, if applicable.

If the IEP team determines that the student should participate in an Extended School Year (ESY) program and the

student is a nonresident, then the tuition billing system will invoice the resident district for the unreimbursed

costs of ESY services.

The tuition billing system uses the special education data submitted through MARSS for students, the Special

Education Data Reporting Application (SEDRA) for special education reimbursable expenditures and the Uniform

Financial Accounting and Reporting Standards (UFARS) for benefits and nonreimbursable costs of providing

special education services.

The tuition billing system captures all:

• state and local special education expenditures

• state special education and excess cost aid generated from these expenditures

• hours of special education service provided to all special education students

The tuition billing system performs the following:

• Calculates a nonreimbursable hourly rate by primary disability or organizational site for the costs of

providing special education services to all students with disabilities after all state special education and

excess cost aid has been accounted for.

• Calculates a special education transportation hourly rate after aid has been accounted for.

• Calculates an individual student invoice for students served by a nonresident district by applying the

hourly rates to the individual student’s hours of special education service.

• If applicable, applies a one-to-one paraprofessional hourly rate to a student’s hours of paraprofessional

service to the student’s invoice.

• If applicable, creates a separate one-to-one professional invoice for the cost to a student’s one-to-one

professional services.

• Transportation rates are calculated for the districts that were identified as the transporting district in

MARSS. To establish an hourly rate, costs not covered by state special education aid or excess cost aid

are divided by the total membership hours for all special education students reported with a MARSS

Transportation Category 03.

• If applicable, moves the general education revenue attributed to the nonresident student.

• If applicable, calculates and includes appeal rates according to Minnesota Statutes, section 125A.11.

The amount of revenue transferred from the resident district to the serving district is summed-up from the

student invoices. A negative tuition adjustment is made to the resident district’s state special education aid and

a positive tuition adjustment is made to the serving district’s state aid. Student invoices can be downloaded into

6 | Page Updated December 2023 Tuition Billing Reference Guide

Minnesota Department of Education

an Excel file from a Local Educational Agencies (LEA’s) “Data Extracts” page in SEDRA. Please see Appendix A of

this guide for information on how to follow the formulas used to calculate a student’s individual tuition bill.

This document provides guidance for the operation of the tuition billing system and the data requirements for

districts in order for MDE to calculate an accurate and complete special education aid adjustment through the

tuition billing system.

Please refer to the Special Education Funding and Data Reference Guide, Section 12 to find additional

information regarding qualifications, duties, and assignments for all Special Education staff.

Student Acknowledgements

Minnesota Statutes 2022, section 127A.47. Payments to Resident and Nonresident Districts

ubdivision 5. Notification of resident district

A district educating a pupil who is a resident of another district must notify the district of residence within

60 days of the date the pupil is determined by the district to be a nonresident, but not later than August 1

following the end of the school year in which the pupil is educated.

Acknowledgements need to be sent for all students if served outside of their resident district. If the student is

enrolled in another district during the school year, the new district needs to send an acknowledgement to the

resident district.

For more information regarding notices of residents enrolled elsewhere, refer to the

MARSS Memo dated

November 16, 2017.

Failure to notify the resident district can result in blocking the invoice from tuition billing and the resident

district will not be billed for any unreimbursed costs for the serving district providing special education services

to the nonresident student. If districts do not meet the statute deadline and MDE receives an appeal from the

resident district with documentation that they have notified the serving district requesting the information,

MDE will block the record in tuition billing. Appeals must be received by December 15 following the close of the

school year.

Staff Communication and Fiscal Year Cycle

The tuition billing system depends on the data from UFARS, MARSS and SEDRA for the rates to be calculated

correctly and the appropriate invoices to be prepared. District personnel need to develop communication

linkages between special education case managers, MARSS coordinators and business office personnel to assure

that the data will be reported consistently through the various systems to MDE. Failure to provide a free flow of

information between these personnel could result in significant cash-flow swings and/or reduced revenue or

expenditures because of the tuition billing adjustment to state special education aid. Deadlines, as established

by the various reporting systems, are used to establish the timelines for the tuition billing system to calculate

rates and generate tuition invoices and adjustments to state special education aids. The data needs to be

submitted in a timely manner through all the reporting systems to assure accurate and timely rates, invoices and

special education aid adjustments.

Minnesota Department of Education

7 | Page Updated December 2023 Tuition Billing Reference Guide

Because the tuition adjustment calculation is based on current year data that is not finalized until after the fiscal

year has ended, various vintages of data have to be used throughout the year. For example, prior year student

counts are used until fall MARSS data of the current year is finalized.

Minnesota Department of Education

8 | Page Updated December 2023 Tuition Billing Reference Guide

igure 1: Tuition Billing Cycle

The following describes the Tuition Billing Cycle and the vintages of data used:

IDEAS Payment July 15 includes Current Year SEDRA, Prior Year MARSS, Second Prior Year UFARS and Current

Year Special Education (SpEd) Aid.

IDEAS Payment September 15 and October 15 includes Current Year SEDRA, Prior Year MARSS, Second Prior

Year UFARS and Current Year SpEd Aid.

IDEAS Payment July 30, August 30, September 30, November 15 includes Current Year SEDRA, Current Year

End-of-Year (EOY) MARSS, First Prior Year UFARS and Current Year SpEd Aid.

IDEAS Payment January 15 includes Final SEDRA, Final MARSS, Final UFARS and Current Year SpEd Aid.

IDEAS Payment February 28 includes Final SEDRA, Final MARSS, Final UFARS, Current Year SpEd Aid and Federal

Funds Applied.

Minnesota Department of Education

9 | Page Updated December 2023 Tuition Billing Reference Guide

Midpoints to Determine Special Education Services Hours

The midpoints are a calculated percentage of time that the “average” student with an IEP, by disability and

instructional setting, receives special education and related services. The primary disability of the student is one

of the two factors to determine the midpoint; the instructional setting is the other factor.

MDE conducted a statewide, stratified, random sample of all students who were eligible for the December 1,

2004 and 2006 child count. More than 6,000 IEP cover and service pages were reviewed and calculated to

determine the midpoints of each setting by disability. The “midpoint” is the “average” percentage of a student’s

membership hours that he/she is receiving special education and related services, including indirect time. The

time of paraprofessionals and individuals doing Personal Care Attendant (PCA) duties was not calculated into the

midpoints. There are several types of instructional delivery models where midpoints do not capture an accurate

percentage of the time that a student receives special education and related services; hence, the special

education service hours must be entered in MARSS. Those service models are more fully defined later in this

document.

The percentages noted below are the results of the review of the IEPs in the sample. The percentage represents

the average for that setting and disability that the students receive special education and related services in a

typical school day.

Means by Disability and Instructional Setting

Code Disability

Setting

III

Setting

VII

Setting

VIII

401 Speech or Language Impairment 0.0390 0.2980 0.3440 0.1300 0.1900 0.1250 0.0710 0.1820

402

Mildly Moderate – Developmental

Cognitive Delay (DCD)

0.2260 0.4680 0.8680 1.0880 0.8910 0.5000 0.8390 0.4340

403 Severe-Profound – DCD 0.1720 0.8820 0.9430 1.0610 0.8520 0.7200 0.4110 0.2990

404 Physically Impaired 0.1510 0.4510 0.9150 1.1580 0.2450 0.6780 0.7670 0.9300

405 Deaf or Hard of Hearing 0.1220 0.4530 0.9940 1.0890 0.6120 0.9580 0.0930 0.2180

406 Visually Impaired 0.1260 0.4700 0.9170 0.4970 0.4240 0.2520 0.2680 0.1050

407 Specific Learning Disability 0.1530 0.3890 0.7460 0.6370 0.4710 0.4610 0.4550 0.4550

408 Emotional or Behavioral Disorders 0.1420 0.4090 0.8780 0.9630 0.6410 0.5700 0.5140 0.4080

409 Deaf-Blind 0.2340 0.6270 0.9120 0.8510 1.0000 1.0000 1.0000 1.0000

410 Other Health Disabilities 0.1670 0.4080 0.9080 0.9860 0.5440 0.5320 0.6050 0.2470

411 Autism Spectrum Disorders 0.1460 0.4730 0.9610 1.0930 0.5720 0.6940 0.4960 0.3340

412 Developmentally Delayed 0.2300 0.3800 0.4030 0.3360 0.0440 0.1700 0.1480 0.2320

414 Traumatic Brain Injury 0.1860 0.4430 0.8130 0.6430 1.0000 0.9760 0.6360 0.3270

416 Severely Multiply Impaired 0.1860 0.4730 0.9740 1.0300 1.0000 0.7620 1.0000 0.1740

Minnesota Department of Education

10 | Page Updated December 2023 Tuition Billing Reference Guide

The tuition billing system uses the number of instructional days, length of a school day and enrollment

percentage reported on the MARSS School File (A-File) to calculate the number of membership hours in a school

year.

The formula to determine the total special education service hours is:

Membership hours x midpoint (instructional setting and disability) = special education service hours.

Reporting Special Education Service Hours

MDE calculates special education services hours for most students with an IEP, using a midpoint percentage at

the primary disability and instructional setting level as discussed earlier. All of fall service hours are calculated

this way. If an LEA reports service hours in the fall, they are ignored. The following MARSS records require

service hours for end-of-year reporting.

For MARSS records where actual membership and services hours are required, report the most accurate hours

starting with the August end-of-year MARSS submission. Reporting one hour of membership of special

education services on the MARSS record will cause the rates in tuition billing to be significantly overstated. The

hours that you report on the MARSS record is what tuition billing will use to create an hourly rate to bill the

nonresident district for unreimbursed costs.

Students who must have the special education service hours reported in MARSS include:

• early childhood special education (EC)

• kindergarten – some reporting may be required in service hours. Check with MARSS team.

• shared time

• sites that have cooperative teaching, inclusive programs or multidisciplinary with stacked services

• students with membership based on credits:

 Independent study – Flag equals yes

 Project based

 Online learning

• students with IEPs and in care and treatment (SAC 27 only – not SAC 28)

• students with SAC 46 ESY

• students on homebound

Basic Reporting Rules for Special Education Service Hours in MARSS

• Hours of special education services reported in MARSS are in conformance with Minnesota Rules,

3525.1310, State Aid for Special Education Personnel.

• Direct and indirect time of certified and licensed personnel, including Occupational Therapists (OTs),

Physical Therapists (PTs), nurses, etc., who are licensed by agencies other than the Board of Teaching.

• Program and one-to-one paraprofessionals, Licensed Nurse Practitioners (LPNs) and personal care

assistants are not included when calculating the special education service hours to be entered in

MARSS.

Minnesota Department of Education

11 | Page Updated December 2023 Tuition Billing Reference Guide

• The time in the regular classroom or community education programs without direct special education or

related services does not count and should not be included in the special education service hours

reported in MARSS.

Indirect Special Education Services and MARSS Reporting

The indirect service providers (teachers, therapists, etc.) are eligible for state special education aid or federal

special education funds; the expenditures should be reported in SEDRA.

Examples for Reporting Special Education Service Hours:

Example 1 – Preschool

A preschooler is receiving special education and related services in an Early Childhood Special Education (ECSE)

classroom with a licensed ECSE teacher. The student has special education services for 2.5 hours a day.

However, during the time that the student is in the special education classroom, he has OT, PT and Speech

Language (SL) each for 20 minutes a day, five days a week. The number of special education hours would be 2.5

hours for the ECSE services plus 20 minutes OT, 20 minutes PT and 20 minutes speech language for a total of 3.5

hours a day of special education services time. (Please remember that the MARSS membership hours may not

be the same as the special education services hours.) Each of the special education service providers had five

minutes indirect time each day on the student’s Individualized Family Service Plan (IFSP). The student

participated in 120 days of ECSE programming. The special education service hours for that student would be

450 hours (420 hours of direct special education instruction and 30 hours of indirect services.) Please see the

MARSS Manual – Procedure 6 for reporting MARSS membership hours.

Example 2 – Inclusive Classroom

A student in an inclusive setting receives 100 percent of his/her special education services in the regular

classroom setting. The student receives an arena service of OT/PT/SL for 20 minutes a day each, and the

resource teacher comes to the classroom to provide 60 minutes of special education instruction and follow-up

for the day’s activities. A paraprofessional works with the student for one hour a day. To calculate the special

education service hours, count the time of each professional, but not any paraprofessional, time.

In this case, the student is getting a total of 60 minutes of arena services (OT/PT/SL services) and 60 minutes of

direct resource teacher assistance for a total of 120 minutes a day or two hours of direct special education

service hours. In addition, there are 30 minutes a day for indirect services of the professional staff. The student

receives 150 minutes of direct and indirect instruction a day. If the student is enrolled for 176 days, then the

student had 440 hours (150 minutes a day x 176 days/60 minutes/hour = 440 hours) of special education

services. Special education service hours reported in MARSS would be 440. The MDE tuition billing system would

use that number rather than the midpoint.

Example 3 – Cooperative Teaching

A middle school social studies class has seven students with IEPs that required adaptations and modifications to

the regular classroom instruction, including specially designed tests, positive behavior supports, repetitive

Minnesota Department of Education

12 | Page Updated December 2023 Tuition Billing Reference Guide

instruction, and time-on-task redirection. The district uses a cooperative teaching model where a teacher with

Specific Learning Disability (SLD) and Emotional Behavioral Disorders (EBD) licensure is assigned to co-teach the

class of 33 students with a regular education teacher. (The special and regular classroom teacher plans

cooperatively, which allows the special education teacher to make the required adaptations and modifications

to the basic curriculum.) The class period is 50 minutes long and each of the students with IEPs receives 50

minutes of special education instruction.

Note: If a paraprofessional had been assigned to this classroom activity rather than a licensed special education

teacher, no direct special education hours could be recorded in MARSS.

If the school year is 174 days, each student in membership would have 145 hours (50 minutes x 174 days of

school/60 minutes/hour = 145 hours) of special education instruction reported in MARSS.

Special Education Instructional Settings

The special education setting is calculated on the amount of time the student receives special education and

related services outside the regular classroom environment. The time a student receives special education and

related services in the regular classroom is not used to calculate the special education instructional setting.

Instructional setting for students ages 6-21:

• 01 – Outside of the regular classroom for less than 21 percent of the school day.

• 02 – Outside of the regular classroom (typically a resource room) between 21 percent – 60 percent of

the school day.

• 03 – Separate classroom more than 60 percent of the school day.

• 04 – Public separate day school facility greater than 50 percent of the school day.

• 05 – Private separate day school facility greater than 50 percent of the school day.

• 06 – Public residential facility greater than 50 percent of the school day.

• 07 – Private residential facility greater than 50 percent of the school day.

• 08 – Homebound/hospital placement.

Note: Refer to the MARSS Reference Guide for ECSE Ages Birth-2 and students ages 3-5 instructional settings and

definitions. The reference guide is located on the MDE website

at the following location: D

istricts, Schools and

Educators > Business and Finance > School Finance > MARSS Student Accounting > MARSS Reporting

Instructions.

Case Manager and MARSS Contact

The typical school program will use only SEES 1-3. The Special Education Staff has the responsibility to work with

the MARSS coordinator to ensure the correct instructional setting and primary disability is reported in MARSS.

Each time there is a change in the instructional setting, the MARSS coordinator must be notified. The Minnesota

Department of Education tuition billing system relies on a correct special education instructional setting as well

as the primary disability to be reported in MARSS.

Minnesota Department of Education

13 | Page Updated December 2023 Tuition Billing Reference Guide

Calculating the Instructional Setting

There are several ways to calculate the special education instructional setting. One way is for the special

education case manager to calculate the instructional setting at the time of the IEP development. In many cases,

it is appropriate to do the calculation on a five-day school week since some of the services may only be delivered

once or twice a week, such as OT, PT, SL, counseling, etc. Because this is a calculation of the time the student is

out of the regular education classroom, indirect service minutes are not included. The formula for calculating

the federal setting is as follows:

Minutes of direct special education and related

services outs

ide regular classroom per week = percent out of regular education = instructional setting

Total minutes of regular education available per week

Example 1 – Resource Room

School day = 368 minutes.

Student A has resource room activities to develop math skills for 45 minutes a day and goes to a speech room

for 25 minutes twice a week. At the end of each school day, Student A has a paraprofessional come to the room

for 10 minutes to help the student get organized to go home. The balance of the time Student A is in the regular

classroom participating with his/her peers. Paraprofessional time is not outside of the regular classroom and

does not count.

Resource room: 45 minutes x 5 days a week = 225 minutes.

Speech room: 25 minutes x 2 days a week = 50 minutes.

Total time in special education per week = 275 minutes.

Regular education time available: 368 minutes per day x 5 days = 1840 minutes per week.

275 Special Education Minutes = 1

4.9 percent = Instructional Setting 1.

1840 Minutes Regular Education Available

Example 2 – Resource Room

School day = 368 minutes.

Student B goes to the resource room for 30 minutes each day for math assistance, 85 minutes each school day

for language arts, and participates in a group counseling activity once a week for 50 minutes. He also has an

adaptation that he will receive crisis interventions as needed. (The time in crisis intervention cannot be planned

and is not accounted for in the calculation of the instructional setting.)

Resource Room: (30 minutes + 85 minutes) x 5 days = 575 minutes per week.

Counseling: 50 minutes per week.

Minnesota Department of Education

14 | Page Updated December 2023 Tuition Billing Reference Guide

Total time out of the regular education class for special education: 625 minutes per week.

Regular education time available: 368 minutes per day x 5 days = 1840 minutes per week.

625 Special Education Minutes = 34.0 percent = Instructional Setting 2.

1840 Minutes Regular Education Available

Example 3 – Self-Contained Classroom

School day = 368 minutes.

Student C has multiple and intense needs that even with adaptations and supplementary aids cannot have

reasonable success in the regular classroom. Student C participates with the regular class for opening activities

(15 minutes), story time after lunch (20 minutes), and end-of-day activities (20 minutes), as well as holiday and

lyceum activities. The student is in the regular classroom for 55 minutes a day and in special education services

outside the regular classroom for 313 minutes.

Total Special Education: 313 minutes a day x 5 days = 1565 minutes per week.

Regular education time available: 368 minutes a day x 5 days = 1840 minutes per week.

1565 Special Education Minutes = 85.1 percent = Instructional Sett

ing 3.

1840 Minutes Regular Education Available

Inclusive, Multidisciplinary and Cooperative Teaching

Districts will have to report the number of special education service hours in MARSS for all students who

participate in an inclusive, cooperative and/or multidisciplinary stacked teaching model. The application of

midpoints to the federal settings will not be a true indicator of the special education service hours that the

student receives. The teaching models will have to involve at least 50 percent of the students with IEPs at the

sites or buildings to be reported as having a teaching model.

Team Teaching

Note: The team-teaching model as described in Minnesota Rules, section 3525.2350, is not included in the

teaching models below. Districts that have a team teaching model will not have to enter the special education

service hours in MARSS.

Inclusive Instructional Setting

A student participating in the inclusive instructional setting will be a full-time participant in the regular

education classroom and have all the special education services delivered in that regular education classroom.

The student does not leave the regular education setting as all or most of the student’s special education

services come to his/her regular education classroom. If the student attends a traditional resource room or

Minnesota Department of Education

15 | Page Updated December 2023 Tuition Billing Reference Guide

other pull-out program, then the program is not inclusive for the purpose of reporting special education service

hours in MARSS.

To report the special education service hours, please refer to Basic Reporting Rules for Special Education Service

Hours in MARSS, on page 9 of this guide.

Multidisciplinary Teaching Model

The services provided under the multidisciplinary teaching model will be “stacked” or included. This model will

have two or more licensed special educators providing the special education services at the same time in the

instructional space. For example, a student will be in a special education service, such as the special education

self-contained class, and have additional services provided to the student in that instructional setting at the

same time the special education teacher is involved in the instruction of the students. These services could

include OT, PT, Speech/Language, vision, deaf, etc. The difference between the team-teaching model and the

multidisciplinary teaching model is that the services are stacked or received simultaneously, much like the

student who is in the general education program and receiving the special education services while the teacher

is providing instruction. Students who leave the self-contained program are considered to not have “stacked”

services and the midpoints will capture the special education service hours.

To report the special education service hours, please refer to Basic Reporting Rules for Special Education Service

Hours in MARSS, on page 9 of this guide.

Cooperative Teaching Model

The cooperative teaching model is another regular classroom-based program. Typically, this program is found

more at the middle/junior or high school level; however, there are a number of cooperative teaching programs

at the elementary level, as well as the preschool level. In the cooperative teaching model, the special education

teacher co-teaches with the regular education teacher in the regular classroom. The students with IEPs receive

adaptive instruction and materials from the special education teacher as part of the instruction in the regular

classroom. The special education teacher is co-teaching the class and providing individualized instruction

required by each student’s IEP, and the instruction is delivered in the regular education environment. Because

this delivery model does not have the students with IEPs receiving specialized instruction outside the regular

classroom, the midpoints calculated by MDE do not capture the special education service hours based on the

federal setting for tuition billing purposes.

To report the special education service hours, please refer to Basic Reporting Rules for Special Education Service

Hours in MARSS, on page 9 of this guide.

Allocating Salaries for Special Education Staff

Salaries for special education professionals, related services and paraprofessional staff members are to be

allocated according to the disabilities of the students served by that staff member. The allocation needs to be

done consistently within the district. It is recommended that the allocation process take place at the same time

Minnesota Department of Education

16 | Page Updated December 2023 Tuition Billing Reference Guide

that the district is reporting staff in October to MDE through Staff Automated Reporting System (STAR). The

district will then have consistent data through STAR, SEDRA and UFARS.

The Minnesota Department of Education recommends the 10 percent rule for reporting staff. If a teacher’s case

load in a particular disability area is less than 10 percent of his/her total case load, then the expenditures do not

need to be allocated to that disability. However, LEAs still need to account for 100 percent of the time spent on

special education activities.

Teachers who are not licensed appropriately in the area of the student’s disability will need to have the team-

teaching model implemented to assure that the teacher has the consultation available from a licensed teacher

in that disability area. The amount and duration of the consultation should be specified in the IEP with the

consultant’s participation.

An interactive spreadsheet titled Allocating Staff by Disabilities

is available on MDE’s website (MDE > Data

Center > Data Reports and Analytics > scroll down to School Finance Spreadsheets > Special Education) that will

assist the districts to allocate the special education staff appropriately. The spreadsheet is a tool to allocate the

staff time and expenditures across the disabilities of the students served. The spreadsheet will re-allocate the

expenditures and hours. Directions on how to enter the data are located on the first tab of the spreadsheet.

An LEA must record actual work performed in a time-and-effort-tracking system as provided

in UGG, section

200.430 Compensation - Personal Services. An LEA must provide reasonable assurance that the charges are

accurate, allowable and properly allocated.

In a situation in which a personal type code indicated an LEA contracted with an individual or company, the

contract must outline the time and work th

at will be performed. Invoices are the after-the-fact record for work

performed. The invoice needs specific information to be able to determine if the expenditure is allowable and

eligible for payment with special education funds.

Reporting One-To-One Paraprofessionals

The following section only applies to one-to-one paraprofessionals (SEDRA Personnel Type Code (PTC) 53) and

not to program paraprofessionals (SEDRA PTC 08) who work with a number of students in a special education

program. Report all paraprofessionals in SEDRA in hours rather than days.

The total time a paraprofessional performs one-to-one duties must be reported in SEDRA as a PTC 53.

The time that the paraprofessional does not provide one-to-one services will be reported on a separate line in

SEDRA using PTC 08. It may mean that a paraprofessional will have two lines in SEDRA. The Minnesota

Department of Education will use all the data submitted with PTC 53 to calculate the hourly rate

(nonreimbursable) for billing of the one-to-one paraprofessionals. The time and salaries entered on PTC 53 will

not be used in the calculation of disability rates. The time entered on lines with PTC 08 will be used in the

calculation of the disability rates.

When the system calculates the one-to-one paraprofessionals, it matches the student’s records in SEDRA to the

records in MARSS by three categories: MARSS (Student ID) number, district of residence and serving district. If

Minnesota Department of Education

17 | Page Updated December 2023 Tuition Billing Reference Guide

the record does not match, the system puts an error message on the SEDRA line. The error message will not be

removed until the next time the tuition billing system calculates the one-to-one paraprofessionals and when all

three categories indicated above match in SEDRA and MARSS.

A report is posted to the “Special Education Tuition Billing” section of the Minnesota Funding Reports (MFR)

webpage that will indicate the number of hours of one-to-one paraprofessional services available (PTC 53) as

compared to the one-to-one paraprofessional services that the students receive (service code V). The total of

service code V should never exceed the amount of one-to-one paraprofessional services available (PTC 53).

Charter Schools, intermediate districts, and cooperatives are different and the hours under PTC 53 and Service

Code (SRV) V must show zero difference. A typical district may have differences and this is acceptable. Districts

should periodically check the report to ensure that the district is not over-reporting one-to-one paraprofessional

services. If there is a significant discrepancy where more hours are reported on service code V than on PTC 53,

MDE will reduce the rates to be proportional to the difference.

If a paraprofessional works with two students and each of those students has the services on their IEPs, then the

time of that paraprofessional will need to be split between the two students. The paraprofessional will be

entered in SEDRA using PTC 53 for the total number of clock hours that he/she works with the students on a

one-to-one basis. If both students are residents of the serving district, enter the total number of clock hours in

SEDRA. However, if one or both of the students are nonresident students, then the time that the

paraprofessional works with the student will need to be proportioned (e.g., one student gets 40 percent of the

paraprofessional's time and attention and the other one gets 60 percent). The time that the paraprofessional

works (in hours) will then be entered in SEDRA using service code V for the nonresident students. You will enter

the proportional time of the one-to-one paraprofessional for that student on the line. Salary is not required. The

tuition billing system will bill the resident district for the excess cost of the one-to-one paraprofessional.

Reporting One-to-One Service Hours – Nonresident Students

SEDRA service code V (nonresident student served by one-to-one paraprofessional) will be used only to report

one-to-one paraprofessional’s time who works with students who are nonresidents of the serving district.

Service code V is not used to report one-to-one paraprofessional time for students who are residents of the

reporting/serving district. The student’s information entered on a line with SEDRA service code V includes the

district of residence and the number of hours of one-to-one paraprofessional time that the student had for that

school year, as supported in the student’s IEP. The line with service code V that is entered in SEDRA will indicate

to MDE the following:

• student first and last name (middle name optional)

• birth date

• gender

• MARSS (student ID number)

• school number

• enrollment start date

• one-to-one paraprofessional hours

• disability

Minnesota Department of Education

18 | Page Updated December 2023 Tuition Billing Reference Guide

The total number of hours of one-to-one paraprofessional time for the student is entered for the school year.

Even if the student had several different one-to-one paraprofessionals, report the total number of hours. A

separate line using SEDRA service code V will be entered for all ESY one-to-one paraprofessional hours for that

student using Funding Source Code (FSC) E in SEDRA. Do not mix regular school year with ESY services.

When calculating the special education tuition invoice, the tuition billing system will verify that there is a MARSS

record indicating that the serving district has entered the student. The tuition billing system will try to match the

MARSS number, disability and district of residence. If there is no match on the three fields of data, the SEDRA

line will error and no hours of services will be billed to the resident district until the line has been corrected. It is

important that the MARSS student ID number be entered accurately in SEDRA under service code V.

You do not have to enter an expenditure amount for service code V as that is not the amount that will be billed

to the resident district. The tuition billing system will use the number of hours reported on the service code V

line and the calculated one-to-one paraprofessional rate to invoice the nonreimbursable costs. The lines entered

on service code V will not calculate special education aid.

Reporting One-to-One Professionals, Contracted Services, Contracted

Student Placements and Equipment

There are occasions when a district will have to hire a one-to-one professional, (not to be confused with a one-

to-one paraprofessional) or contract for services, place a student in a program or purchase equipment for a

nonresident student with an IEP. Please note: A one-to-one professional is a licensed staff who is assigned

exclusively to a student. It is not a person who provides speech language, occupational therapy and physical

therapy services for several students. The following is an example of a one-to-one professional service:

• The student’s IEP may require the special education services of a one-to-one professional, such as a

school nurse, an interpreter, a special education teacher, an intervener for a student who is deaf, blind,

etc. The district may also have to contract with an outside agency for a one-to-one physical therapist

who will work with only the nonresident student.

Districts may contract for individual student special education services with private and public agencies (not

another Minnesota public school) and out-of-state agencies. Report students who are placed outside district

facilities during the regular or ESY as service code C. Enter only the education cost in SEDRA. Do not deduct

general education revenue. It will be deducted in SEDRA, if applicable. Do not enter costs for room and board.

Be sure the student is entered appropriately in MARSS.

Changes to the funding formula starting in SFY 16 eliminated Minnesota Statutes, section 125A.76, subdivision 2,

and replaced it with “nonfederal special education expenditures,” which means all direct expenditures that are

necessary and essential to meet the district’s obligation to provide special instruction and services to children

with a disability. No longer are there statements: “that are supplementary to a full educational program” or “in

place of.” This means that SEDRA will no longer have general education deducted because LEAs must report on

the cost of special education.

Minnesota Department of Education

19 | Page Updated December 2023 Tuition Billing Reference Guide

Early Childhood (school readiness type program) charges a tuition fee that normally would be charged to the

parents, but since the IEP places the student in the program, the district pays the fee. Student receives pull-out

special education services and/or maybe a paraprofessional is placed in the classroom. The school readiness

teacher is a general education teacher.

• In this example, the school will continue to pay the tuition fee; however, they will not enter the cost

in SEDRA as the fee is for general education and not specialized instruction. The district will receive

general education revenue for the time spent in the program through their MARSS reporting. At a

minimum, EC students generate 231 hours of membership (0.28 Average Daily Membership (ADM)).

The district will report only the push-in/pull-out special education services it provided in SEDRA. If

they did place a special education para in the classroom, they will claim that person’s costs in SEDRA

for aid.

Early Childhood (school readiness type program) charges a tuition fee that normally would be charged to the

parents, but since the IEP places the student in the program, the district pays the fee. Student receives pull-out

and/or push-in special education services and a licensed special education teacher is placed in the classroom to

work alongside the general education teacher.

• In this example, the school will continue to pay the tuition fee; however, they will not enter the cost

in SEDRA, as the fee is for general education and not specialized instruction, since it is a fee that

would normally just be paid by general education students. The district will receive general

education revenue for the time spent in the program through their MARSS reporting. At a minimum,

EC students generate 231 hours of membership (0.28 ADM). The special education teacher’s time

and costs will be entered in SEDRA and will generate aid. The district will report only the push-

in/pull-out special education services it provided in SEDRA.

A first to twelfth-grade student is placed in private care and treatment, placed out of state or similar situations

where the resident district reports as being the serving district in MARSS, yet another non-Minnesota LEA is

providing the service. In these cases, districts would receive an invoice for just the educational services and

enter the cost in SEDRA. Because they are reported in MARSS as being served by the resident district, they

generate general education funds.

• The district will need to work with the service provider to have their invoices split into special and

general education costs. They will then enter only the special education costs in SEDRA. The total

cost in SEDRA will flow to the funding formula for aid. Again, it is unknown what percentage of

invoices received by districts have the costs broken out by general and special education.

These changes will go into effect beginning in SFY 18. For examples 1 and 2, LEAs will stop coding the tuition fee

in the Uniform Financial Accounting and Reporting Standards (UFARS) system to special education.

Subsequently, this will result in less data having to be entered in SEDRA. Example 3 requires LEAs to work with

contracting public, private or voluntary agencies to have their invoices split out between eligible special

education costs and those that are general education. The Minnesota Department of Education does not know if

all invoices received have costs split out by general and special education. The majority of invoices that MDE

sees have the costs separated, but not all do.

See examples of entering contracted student placements in SEDRA in Section 11 Service Codes, in the Special

Education Funding Guide.

Minnesota Department of Education

20 | Page Updated December 2023 Tuition Billing Reference Guide

There are cases when the serving district will have to purchase specialized equipment for a nonresident student.

When a student has open enrolled or is placed outside the resident district, the resident district will always be

fiscally responsible for the student’s special education, as long as the parents reside in that district.

The serving district will report the expenditures for the one-to-one professional (service code A, U), contracted

services (service code B), contracted student placement (service code C) or equipment (service code as

appropriate) in SEDRA.

The serving district will follow the Tuition Billing One-to-One Services Instructions

for specialized services or

equipment with all of the required information in the District Note section when entering the line in SEDRA.

Please note that there is a $2,500 threshold for each service/equipment. The tuition specialist in the Division of

School Finance will then manually enter the information into the tuition billing system, which will account for

the special education aids and automatically produce an invoice to the resident district for the unreimbursed

costs. Required information to include in the district notes in SEDRA or on the SEDRA line:

• Name of Professional

• Type of Equipment or Service

• Status

Begin Date MM/DD/YYYY on MARSS Record

• Dates of Service MM/DD/YYYY beginning and ending

• Total hours of Type of Service

• Serving district name, district number, and district type

• Resident district name, district number, and district type

• Learner information: Last name, first name, MARSS number, grade, primary disability code, and date of

birth

• Serving School Site Number (not district number)

• Email MDE with line number and reason for the line

Please inform the resident district of the above information for their budget purposes.

Organization-Site Rates

The Organization-Site (Org-Site) rate is an option only available to intermediate districts, cooperatives, charter

schools and districts with an enrollment of fewer than 500 students. The Org-Site rate distributes the costs more

accurately in situations where: 1) students with different primary disabilities are receiving similar services; or, 2)

when there are too few special education students and the expenditures cannot be accurately isolated to the

specific disability, resulting in a skewed hourly rate by primary disability.

Org-Site rates apply to all sites within the intermediate district/cooperative/charter school. A combination of

rates by primary disability and org rates are not allowed. Only one rate structure can be used.

The Minnesota Department of Education automatically applies Org-Site rates for all intermediate districts,

cooperatives and charter schools.

School districts with an enrollment fewer than 500 students will have to request the use of Org-Site rates or

switch from Org-Site rates back to disability rates by sending a request to Supervisor, Special Education Funding

and Data, Division of School Finance.

Minnesota Department of Education

21 | Page Updated December 2023 Tuition Billing Reference Guide

The Org-Site rate is calculated using the UFARS data provided to MDE:

• The tuition billing system totals all eligible UFARS Finance Dimension (FIN) 740, 317, 320 and 335

expenditures by organizational code:

 Payroll (object codes 140, 143-146, 150-166,168, 172-176, 185-186 and 396)

 Contracted services (object codes 307, 394 and 399)

 Supplies, materials and equipment (objects codes 315, 335, 350, 369, 380, 381, 406, 433, 456,

466, 506, 533, 560, 564, 556, 562 and 582)

 Unreimbursable nonfederal (object codes 110, 170, benefits 191, 199, 210-251, 270-280, 299,

397, 305, 320, 329, 365, 366, 401, 405, 455, 465, 505, 530, 555 and 820)

• Each site will have a percentage based on the total expenditures for payroll, contracted services and

supplies from UFARS FIN 740, 317, 320 and 335 with the object codes above (denominator).

Expenditures for Org-Site 005 (districtwide) will be distributed to the site proportionally.

Org-Site Rate Calculation Example

Tuition Billing Org-Site Expenditures

The data example below shows Org-Site expenditures an LEA would see in SEDRA. The expenditures should

closely match the UFARS budget for that fiscal year. MDE pulls in final audited UFARS data in January following

the closed school year.

Number

name Employee Contracted Staff Supplies and Equipment Non-Reimbursable

010 Carey Middle School 798000.00 130000.00 5000.00 210000.00

020 Jones High School 115000.00 15000.00 1000.00 40000.00

Next is a calculation of how the data is used. The salaries, contracted staff and supplies/equipment are totaled

at each Org-Site to create a percentage of total expenditures at that site. That percentage is used to allocate

that year’s SEDRA Funding Source Code “A” expenditures (not including PTC 53) to each org site.

inally, Section C of the Rate Calculation by Org-site report on MFR shows how each org site rate is calculated.

As you can see, the total amount in the UFARS column in the calculation above is more than the total on the

Rate report below under, “Old Formula SEDRA A.” The site percentages from above are multiplied by the total

amount in SEDRA (again not including PTC 53) under just funding source code A to allocate the current year

costs. You can also see that the amount entered in the Non-reimbursable column on the Tuition Billing Org-Site

Minnesota Department of Education

22 | Page Updated December 2023 Tuition Billing Reference Guide

Expenditure is just transferred through and entered on the Org-Site Rate report. When we have FINAL UFARS

data, we will override all of the Org-Site expenditures in SEDRA with actuals.

Budget/Expenditure Adjustment Procedures for Org-Site Rates

Since sites may change and costs for a program vary from one year to the next, it is necessary for any entity

using Org-Site rates to update the Org-Site expenditures reflecting reimbursable and nonreimbursable

expenditures. These estimated expenditures should be updated throughout the year. Failure to do this update

will result in: 1) a cooperative/intermediate districts/charter schools costs not being covered; and, 2) inaccurate

distribution of costs to the resident district.

At the end of the year, when audited UFARS data are available, MDE uses the UFARS data to calculate the

percentages used to distribute data reported in SEDRA by site. Therefore, it is important to report expenditure

data on UFARS to the correct Org-Site.

Additionally, it is important for the UFARS data to be accurate by Org-Site. If an Org-Site rate is more than three

times the district-wide average rate, the Org-Site rate for that site is automatically lowered to the district-wide

average rate. This is to ensure that the LEA is not over-billing resident districts for services provided to

nonresident students at certain sites and under-billing for services provided at other sites.

Instructions for Entering Org-Site Data in SEDRA

A menu option is available in SEDRA to keep the budget and expenditures up to date for the tuition billing

system. You will select “Tuition Billing Org-Site Expenditure Entry.” Note: This option will not appear on your

menu if you have not been approved for Org-Site rates. If you have been approved and do not see this option in

the menu, send an email to the Special Education Funding and Data Team

(mde.spedfunding@state.mn.us) to

request assistance.

This is a sample of the SEDRA menu with option “Tuition Billin

g Org-Site Expenditure Entry.”

Minnesota Department of Education

23 | Page Updated December 2023 Tuition Billing Reference Guide

he screen below shows the area where you can update and maintain your expenditure/bud

get information.

This data will be used until the final UFARS submission by your district, charter school or cooperative. It is

important that you track the timeline calendar for the fiscal year for tuition billing activities that is available on

the special education tuition billing webpage (MDE homepage > Districts, Schools and Educators > Business and

Finance > School Finance > Special Education > Tuition Billing). This data will be used at the same time as the

SEDRA data, as shown in the tuition billing timeline.

Minnesota Department of Education

24 | Page Updated December 2023 Tuition Billing Reference Guide

“Unreimbursable” Nonfederal Special Education Costs

Minnesota Statutes 2022, section 125A.76, subdivision 1(f), “Nonfederal special education expenditure,”

means all direct expenditures that are necessary and essential to meet the district’s obligation to provide

special instruction and services to children with a disability, as submitted by the district and approved by the

department, excluding expenditures:

1. Reimbursed with federal funds;

2. Reimbursed with othe

r state aids;

3. For general education costs of serving students with a disability;

4. For facilities;

5. For pupil transportation;

6. For postemployment benefits.

See nonfederal code sheets posted to the MDE website

under Districts, Schools and Educators > Business and

Finance > School Finance > Special Education > State Funding for eligible SEDRA service codes and UFARS object

codes.

Care and Treatment – Students in Transition

Students placed in care and treatment programs in which instruction is provided should be reported in MARSS

by the treatment program. During a period of transitioning back into the regular school (transition school or

district), the student continues to be reported only by the treatment program. The treatment program does not

withdraw the student until the student has fully transitioned out of the treatment program. The general

education revenue attributed to the time that the student was served by the transition district/school during the

transition should be billed to the care and treatment program. The special education aid adjustment is made to

the care and treatment program and reflects the total general education revenue moved from the resident

district to the serving district.

Minnesota Department of Education

25 | Page Updated December 2023 Tuition Billing Reference Guide

For example, the student below is reported only by the care and treatment program for September through

November. The student is reported in MARSS by the high school beginning in December.

• In September, the student attends an instructional program for six hours per day for the treatment

program only.

• In October, the student attends the local high school for two hours per day and for four hours of

instruction per day at the treatment program.

• In November, the student attends the high school for four hours per day and for two hours of

instruction per day at the treatment program.

• In December, the student attends only the high school.

The transition district/school should use the Uniform Tuition Billing Invoice for Transition Services form to

determine the billable costs to the care and treatment program. This form can be found on the MDE website at

Districts, Schools and Educators > Business and Finance > School Finance > Special Education > Tuition Billing.

Private Care and Treatment Programs

Students who are placed in private care and treatment programs are not included in the tuition billing system

even when the providing district (the school district where the private care and treatment facility is located)

does the tuition billing to the district of residence. A care and treatment program is considered “private” when

the instruction is being provided by staff that are not employees of a school district.

The student is entered in MARSS as a SAC 28, which excludes the student from being invoiced through the

tuition billing system. The private care and treatment program or the providing district would invoice the district

of residence for the costs of education associated with the services provided the student. If the student has an

IEP and has been placed in a private care and treatment program, the expenditures would be eligible for state

special education aids.

Minnesota Department of Education

26 | Page Updated December 2023 Tuition Billing Reference Guide

Early Childhood Initial Evaluations and the Bill Back Process

The MARSS Manual Procedure 6 outlines the process for the initial evaluation as follows:

The resident district is responsible for providing evaluation to children who may be eligible for special

education services. See section on evaluation for voluntary prekindergarten. The resident district may

choose to conduct the evaluation itself or may purchase evaluation services from another district. This

happens most often when a child participates in child care outside the resident district throughout the

school day. Because the resident district is responsible for assuring that the service is provided, the

resident district must report these enrollments in MARSS using SAC 00. If a nonresident district provides

evaluation services to a prekindergarten child, the enrollment record should have SAC 21; no state aid is

generated and there is no bill back to the resident district. However, a cooperative that provides the early

childhood special education program on behalf of its member districts can also provide the evaluation

services and report those hours in MARSS using SAC 10 or 19. (Note that a foster child without an IFSP or

IEP is a resident of the district in which the foster home is located.)

The resident district is responsible to conduct the initial evaluation of a prekindergarten student. If a

nonresident district secures the permission from the resident district to conduct the evaluation, the costs

associated with the evaluation of a child who is a nonresident are not eligible for special education aid or

inclusion in the tuition billing system.

The resident district is responsible for the initial evaluation and may use a purchase of service agreement with

the district conducting the evaluations. The resident district will receive general education revenue and special

education aid on the staff that conduct the evaluation.

The resident district and the serving district must have an agreement that the serving district will provide the

initial evaluation and bill back the resident district for these services. Based on the agreement, the billing and

reporting process should be as follows.

Serving District:

• Provides the evaluation services

• Does not report the student in MARSS during the initial evaluation time period

• Tracks the time spent by the service providers (teacher, psychologist, OT, etc.) for the evaluation

• Bills the resident district for actual costs for these services

 Example, the evaluation may take one teacher 5 hours and a psychologist 2 hours. This billing

would then contain:

• Teacher name and file folder number, actual salary and fringe benefit amounts for 5 hours

• Psychologist name and file folder number, actual salary and fringe benefit amounts for 2

hours

• Completes a journal entry moving the salary and fringe benefits of the service providers time spent on

the evaluation to a 000 finance code and removing this time from SEDRA. These costs are being

reimbursed from the resident district and cannot be claimed for aid.

• Code the revenue from the resident district to source code 022.

Minnesota Department of Education

27 | Page Updated December 2023 Tuition Billing Reference Guide

• Please note: These costs are incurred and paid for by the resident district, therefore they are the

resident districts’ costs to claim for state aid. The serving district needs to exclude these costs from their

special education reporting because they will be fully reimbursed for their staff’s time when they invoice

the resident district per the agreement. State statute says that you cannot receive special education aid

for expenditures that have been reimbursed with other funds. Therefore, if they do not reduce these

hours and expenditures, these costs are reimbursed twice to the serving district and once to the

resident district.

Resident District:

• Has an agreement with the serving district to evaluate your student

• Reports the student in MARSS using SAC 00 for the evaluation time

• Pays the serving district when the bill is received

• Enters the costs associated with the evaluation in SEDRA. These expenditures are entered as a purchase

of services.

The coding would be:

• State Funding

 UFARS codes 396 for salary and 397 for fringe benefits

 SEDRA coding Funding Source Code A, Service Code U for the salary

 SEDRA coding Funding Source Code small a, Service Code L for the fringe benefits

 SEDRA coding Personnel Type Code as appropriate.

 SEDRA coding Add file folder numbers, time units and expenditure amounts

• Federal Funding

 UFARS codes 303 for teacher, object codes as appropriate for other staff

 SEDRA coding Funding Source Code B, F, or H

 SEDRA Service Code B

 SEDRA coding Personnel Type Code as appropriate

 SEDRA coding Add file folder numbers, time units and expenditure amounts

Any services provided to a nonresident student would not be eligible for state special education aids and

inclusion in the calculation of the tuition billing system until the student has a MARSS SEES of one of the

following:

• 4 – Evaluated – receiving services.

• 6 – Evaluated – receiving services and receiving services through a public agency.

Extended School Year Services – Reporting in MARSS and SEDRA

The tuition billing system will account for all ESY services provided during the summer break between the end of

school and the beginning of the next school year. All ESY services for students with disabilities are reported in

MARSS as a SAC 46.

Minnesota Department of Education

28 | Page Updated December 2023 Tuition Billing Reference Guide

Note: Students who are EC will not have ESY services as their services are provided year round through a

modified contract and with their services provided within typical contract period of the teachers. All special

education and related services for ECSE students are reported in SEDRA under Funding Source Code (FSC) A.

Note: The MDE tuition billing system will not bill for instructional hours or services for students with IEPs who

are in care and treatment programs under Minnesota Statutes, section 125A.515, during the summer. The

serving district will have to bill the resident district for the instructional services only if the student has been

determined not to be performing at grade level (Minnesota Statutes, section 125A.515, subdivision 7). The

expenditures to provide those ESY services will be reported in SEDRA using FSC E. The expenditures entered in

SEDRA for FSC E will be used to calculate the rates for the students who are served and will be used to invoice

nonresident students.

A partial record will be entered in MARSS for all ESY services provided during the summer recess. The partial

record will include:

• serving district number and type

• resident district number and type

• school number

• student MARSS ID number

• name

• grade level

• special education evaluation status

• instructional setting

• primary disability

• special education service hours

• start date

• end date

• birth date

• state aid category 46

The actual hours of special education services entered in MARSS are used to calculate the rates and also used to

bill nonresident students who receive special education and related services. If the actual hours of services are

not significant enough to fill each cell (disability) for rate calculation, then the districtwide rates will be applied,

much like it is for the regular school year for those areas of disability that may have rates that do not meet

criteria or are zero.

Transportation is not charged for the summer months as the data from UFARS is used for the regular school year

only.

Learning Year and Extended School Year (ESY)

Background

Approved learning year programs operate year round. All State Approved Alternative Programs (SAAPs) must be

learning year programs (Minnesota Statutes, section 124D.128, subdivision 2). Learning year status is the means

Minnesota Department of Education

29 | Page Updated December 2023 Tuition Billing Reference Guide

by which a student can generate more than 1.0 ADM (Minnesota Statutes, section 126C.05, subdivisions 8 and

15). Learning year is an optional program for students. The membership generated at the learning year program

is eligible for general education revenue.

ESY is a required special education service per the student’s IEP. The student’s time spent in ESY does not

generate general education revenue, as it is outside the regular school year, learning year or school day. ESY

provides specially designed instruction to meet the unique needs of the individual student. These services are

provided over and above the services provided to the student in the regular or learning year.

MARSS Reporting Procedure

In order to not over bill resident districts for special education services provided during the summer term of the

learning year program and services provided via ESY by a nonresident district, the MARSS learning year

enrollment record should reflect the special education services received for that particular enrollment period.

Typically, a learning year program in the summer is more for remedial services than special education

programming that is based upon the student’s IEP.

Special education students attending a learning year program during the summer portion should be reported in

MARSS with a MARSS SEES 4 or 6, only if they are receiving special education services during the time they are

enrolled in the learning year program. It is presumed that the IEP in effect for the regular school year would also

reflect the same services provided during the summer term of the learning year. If not, then the IEP should

reflect the changes in those services and should be made to the MARSS record (e.g., instructional setting should

be noted on a new MARSS record).

If the student is not receiving special education services during the summer term of the learning year program,

the student should be reported in MARSS with a SEES 1. A student could receive special education services

during the summer term of the learning year program and also receive ESY services. Special education services

provided during the summer term of the learning year program are not considered ESY. They are considered

regular year special education. Special education services provided during the summer term of the learning year

program should be consistent with the IEP in effect for the regular school year.

Any special education service hours generated during the learning year program will generate a special

education tuition bill based upon RSY hourly rates by disability, including general education revenue, if

appropriate.

Learning Year and SEDRA

Any special education services provided during the learning year will need to be coded in SEDRA to FSC A in the

same fiscal year as the MARSS learning year record.

All expenditures generated by learning year programs after the end of the regular school year are attributed to

the next fiscal year. For example, if the learning year program runs from June 15, 2022 through August 8, 2022,

all of the expenditures would be reported in SEDRA in the 2022-23 school year. Expenditures generated by ESY

programs, are reported according to the fiscal year in which they were incurred. For example, expenditures for

Minnesota Department of Education

30 | Page Updated December 2023 Tuition Billing Reference Guide

FY 2022, would be services provided from July 1, 2021, up to the beginning of the regular school year and

services provided at the end of the school year through June 30, 2022.

Issues When Tuition Billing Does Not Cover Costs for LEAs

Tuition billing is a timing issue for LEAs. If an LEA entered its data in SEDRA the day after the tuition billing rates

are calculated, the LEA will not have those data included in the rates. Once the tuition billing system has

calculated the special education aid adjustment, the adjustment will not be updated until the next scheduled

calculation. The relationships between serving and resident district are so complex that the recalculation of a

single LEA is not possible.

There should be a continuous communication linkage between the director of special education and the MARSS

coordinator for the LEA. It is very important that each student who has an active IEP is identified in MARSS with

a SEES of 4 or 6. The failure to report all students receiving special education funding will result in overstated

rates and improper invoicing of unreimbursed costs to resident districts.

The individual responsible for the SEDRA data of the LEA needs to review the SEDRA data. It is important to

periodically review the lines in error. The issues that cause these lines to be in error must be resolved quickly.

Again, lines in error, including service code V, are not used to calculate the rates or invoices. Further, the SEDRA

data needs to be kept current with accurate data for all eligible special education data. If data is not entered in

SEDRA, it cannot be included in the calculation of state special education aids or rates.

The One-to-One Paraprofessional Report should be checked each time the tuition billing system updates

calculations. This report details the number of hours available for one-to-one paraprofessional services as

reported in SEDRA for staff entered under personnel type code 53. The report will also show the number of

hours of one-to-one paraprofessional services used as reported in SEDRA for students entered under service

code V. The goal of the LEA should be to have the number of hours available (PTC 53) equal the number of hours

services were delivered to students (service code V) unless the LEA is a school district with a type code 01, 03 or

06. If there is any variation, then the one-to-one paraprofessional services are being over- or under-invoiced to

the resident school districts. The greater the variation in the hours reported is the larger the over- or under-

invoicing to the districts. The LEA is obligated to review and correct the data in SEDRA to assure that the number

of one-to-one services hours are accurate.

If the one-to-one paraprofessionals are not an issue, the LEA should turn to the Rate Calculation Report. The

report is in order by Disability Rate then Org-Site Rate. The LEA should read the detailed information on the

items of this report as found in this reference guide.

Tuition Appeal Rates

Under certain conditions, Minnesota Statutes, section 125A.11, subdivision 1(c), allows a district, cooperative or

charter school to appeal to MDE if the Tuition Billing Model is not covering their costs for providing special

education services to nonresident students.

In general, there are three statutes dealing with charter schools that have a high special education population.

31 | Page Updated December 2023 Tuition Billing Reference Guide

Minnesota Department of Education

Minnesota Statutes 2022, section 125A.11, subdivision 2, a charter school where more than 30 percent of

enrolled students receive special education and related services, a site approved under section 125A.515, an

intermediate district, a site constructed according to Laws 1992, chapter 558, section 7, subdivision 7, to meet

the educational needs of court-placed adolescents, or a special education cooperative may apply to the

commissioner for authority to charge the resident district an additional amount to recover any remaining

unreimbursed costs of serving pupils with a disability.

Minnesota Statutes 2022, section 127A.47, subdivision 7(d), special education aid paid to a resident district

must be reduced by an amount equal to 100 percent of the unreimbursed cost of special education and

services provided to students at an intermediate district, cooperative, or charter school where the percent of

students eligible for special education services is at least 70 percent of the charter school's total enrollment.

Minnesota Statutes 2022, section 124E.21, subdivision 2(c)(1)(2), "Eligible special education charter

school" means a charter school:

1) where th

e percent of students eligible for special education services equals at least 90 percent of the

charter school's total enrollment; and

2) that submits to the commissioner a preliminary annual budget by June 15 prior to the start of the fiscal

year and a revised budget by January 15 of the current fiscal year detailing its unreimbursed costs for

educating students eligible and not eligible for special education services.

Appeal Process and Procedures

If a resident district finds that it does not agree with the tuition invoice from the tuition billing system, the

resident district needs to work with the serving district to find a solution to the issue. If the data systems of

UFARS, SEDRA and MARSS are closed, then the district disagreeing with the tuition invoice (and this could, in

certain cases, be the serving district) can appeal to MDE to have the invoice/rates reviewed. A letter should be

submitted to the Division of School Finance that indicates the district is appealing the invoice/rates for a district

or a student. Information pertinent to the appeal should be included with the letter.

If the district, cooperative or charter school determines that their costs are not being covered, they should

submit a request to Special Education Funding and Data, Minnesota Department of Education, Division of School

Finance, 400 NE Stinson Blvd, Minneapolis, MN 55413.

Once an appeal has been accepted by the Division of School Finance, all districts involved are notified of the

appeal. The Minnesota Department of Education will request specific information as it relates to the appeal

from the serving district and/or resident district. Appeals will be accepted for the following student data errors:

• district of residence

• instructional setting

• primary disability

• special education evaluation status

Generally, the appeal is a paper process; however, there could be times when MDE will meet with the districts

involved in the appeal to gather additional information. Once the information is provided to MDE, a letter of

findings is sent to all the parties involved in the appeal. The findings will state the pertinent facts of the appeal

and the proposed outcome. Each district will have ten days to respond to this letter. Following the review of the

Minnesota Department of Education

32 | Page Updated December 2023 Tuition Billing Reference Guide

responses, MDE will issue the order that sets the rates, etc., for the districts. The rates and order are binding on

all districts.

Using Federal Funds for Tuition Payments

Resident districts can request to use their current year federal finance 419 funds to reduce their tuition billing

adjustment amount. If requested, these funds will be applied to the districts serving the resident district’s

students. The federal funds are usually paid to the serving district at about the same time the negative

adjustments are made in IDEAS.

The federal funds tuition payment revenue should be coded to the original code that the district receiving the

funds set up as a year-end receivable. Some districts used Source Code 360, State Aid for Special Education.

Other districts used Source Code 400, Federal Aids Received through Minnesota Department of Education with

Finance Code 419, Individuals with Disabilities Education Act (IDEA) Part B Section 611.

The resident district and serving districts should also go to the Minnesota Funding Reports (MFR) to print their

tuition district summary. Please see the description below for the Special Education Tuition Billing District

Calculation report, specifically the Column E description.

UFARS Procedures – Using Federal Funds for Tuition Bill Costs

MDE will withhold the amount declared from their final federal Part B Section 611 Allocation (FIN 419) for use

towards tuition bill expenses. The amount is currently not reflected in the amount of the Part B Section 611

Allocations in SERVs. UFARS Object Code 308 should be used for the first $25,000 of tuition bill payment and

UFARS Object Code 309 should be used for the remaining portion of the tuition bill (amount in excess of

$25,000).

Since the expense is not reported in SERVS for reimbursement, the 000/011/012 course codes should not be

used. The following entries are used to record the amount declared to be used for tuition bills at the end of SFY

2019.

• Debit – 01-XXX-XXX-419-308/309-000

• Credit – 01-122-XX

In February or March of the following year, MDE will calculate final tuition bills and make payments to the non-

resident LEA. In the following year, adjust the object codes 308/309 for the difference between the estimated

tuition payments and actual payments. The adjustment should take into account the amount of federal funds

used as well as the split between 308/309.

Reports on Minnesota Department of Education Website

There are six reports on the MDE website to help verify that the information submitted in MARSS, UFARS and

SEDRA is accurate and complete. View the Data Reports and Analytics webpage and choose the Minnesota

Funding Reports (MFR) under School Finance Reports. The following is a detailed discussion of the reports:

Minnesota Department of Education

33 | Page Updated December 2023 Tuition Billing Reference Guide

• Special Education Tuition Billing District Calculation

• Special Education Tuition Billing Billable Students from MARSS – Regular School Year

• Special Education Tuition Billing Billable Students from MARSS – Extended School Year

• Special Education Tuition Billing Regular School Year/Extended School Year Rate Calculation

• Special Education Tuition Billing Organizational Site Rate Calculation (if applicable)

• Special Education One-to-One Paraprofessional Hours Comparison (if applicable)

Special Education Tuition Billing District Calculation

The Special Education Tuition Billing District Calculations report summarizes your district’s tuition calculations.

The first area is “Expenditures” for the resident district. These expenditures are for your resident students

served in other districts. Each district that serves your resident students will be listed.

The “Revenues” are the costs for your district serving nonresident students. The total costs for nonresident

students that you serve will be listed by resident district in district numerical order.

Make sure that all the districts to be listed are included. The last portion of the summary reflects the totals of all

the tuition invoices by categories.

Note: Federal funds are only applied to the nonreimbursable amount in column D after the year is closed and

the final calculation is completed.

Column A: Reflects the reimbursable costs that the resident district owes the serving district due to One-to-

One Licensed Professional Services provided to the nonresident student.

Column B: Not applicable.

Column C: Reflects the total reimbursable costs that the resident district owes the serving district due to

One-to-One Licensed Professional Services provided to the nonresident student.

Column D: Reflects the nonreimbursable costs that the resident district owes the serving district.

Column E: Reflects the amount of federal funds used by the resident district to cover the nonreimbursable

costs. Note: The resident district can declare an amount of current year federal funds to cover

the nonreimbursable costs. MDE distributes the federal amount proportionately across all the

nonreimbursable costs.

Column F: Represents the net nonreimbursable cost after federal funds have been applied.

Column G: Reflects the amount of general education revenue that MDE is moving to the nonresident

district that was generated by the resident district for students served by the nonresident

district. This amount is transferred through the state special education tuition adjustment made

to state special education aid. If the nonresident district already received the general education

revenue through enrollment options, there would be no transferring of general education

revenue for that student. This may also include any General Education and Building Lease

appeals costs. Building lease cost is only available to charter schools that have unreimbursed

Minnesota Department of Education

34 | Page Updated December 2023 Tuition Billing Reference Guide

lease costs for facilities that have more than 50 percent of the instructional expenditures

attributable to special education.

Column H: Debt service cost is only available to districts that have unreimbursed debt service costs for

facilities used primarily for special education. “Primarily” is defined as a site that has more than

50 percent of the instructional expenditures attributable to special education.

Column I: Not applicable.

Column J: Reflects the amount of unreimbursed transportation costs for students that have transportation

as a related service in their IEP that the resident district is to pay to the transporting district.

Please note: The transporting district is not always the district that serves the nonresident

student.

Column K: Is the total amount of all columns.

Revenues less expenditures: the net of revenue owed to the district and expenditures owed by the district. A

negative amount indicates the district has more expenditures than revenue. A negative adjustment in that

amount will be made to the districts state special education aid. If a positive amount, a positive adjustment will

be made to the district’s state aid. The impact of the adjustment will show up in the Integrated Department of

Education Aids System (IDEAS) as the difference between the entitlement amount and the prorated aid

entitlement column.

Federal Funds for Tuition

During the New Year Application Process, LEAs requests on their Federal Cover Sheet to use a certain amount of

their federal funds to cover tuition costs. The federal funds portion is not applied to the nonreimbursable net

cost until February or March after the close of the year and all data is final. Federal funds are not included in the

total under the revenues – costs for serving nonresident students. The federal funds tuition payment revenue

should be coded to the original code that the district receiving funds set up as a year-end receivable. Some

districts used Source Code 360, State Aid for Special Education. Other districts used Source Code 400, Federal

Aids Received through MDE with Finance Code 419, Individuals with Disabilities Education Act (IDEA) Part B

Section 611.

Special Education Tuition Billing Billable Students from MARSS – Regular School

Year/Extended School Year

This report is a summary of the students with IEPs reported in MARSS who are nonresidents of your school

district. It is the summation of the data submitted on the most recent MARSS submission. The summary is by:

• disability

• instructional setting

• count of students

• special education service hours that have been calculated by the tuition billing system

Minnesota Department of Education

35 | Page Updated December 2023 Tuition Billing Reference Guide

This is the time to note if the count is correct based on the information submitted. If you are anticipating that

there should be 18 students who are nonresidents participating in your special education programs and there

are only 13 listed, then you know that there is an issue to be addressed. Omission may be the result of: (1)

MARSS reporting errors that the student record is not being loaded into the MDE databases including the tuition

billing system; (2) the student is not reported as special education evaluation status of 4 or 6; or, (3) the student

is not being reported in MARSS at all. This report is also useful if you want to project the special education

tuition revenue.

Special Education Tuition Billing Regular/Extended School Year Rate Calculation (Rates

by Disability)

The rate calculation report uses the data from UFARS, SEDRA and MARSS to calculate the rates for each

disability. If Org-Site rates are calculated, a separate report is generated showing the rates by site.

Section A

This section shows expenditures, aid calculations and total special education costs entered in SEDRA used to

determine the adjusted state special education aid. Line 20 shows how the ratio of expenditures-to-aid is

calculated (“RATIO1”) and used to determine the unreimbursed cost that will be billed to the resident district for

the RSY and ESY.

Section B – Regular School Year

This section has all the expenditures listed in SEDRA for contracted student placements (SEDRA service code C),

one-to-one services; professional, equipment and contract expenditures for students, Alternative Delivery of

Specialized Instructional Services (ADSIS) and Access to Career Technical Education for students with a disability

(ACTE-SPED) (formerly Transition Disabled). The one-to-one professional expenditures are submitted on forms

to MDE. The purpose of this section is to account for the special education program and excess cost aids

attributable to those expenditures. If MDE did not account for those expenditures, the aid would be overstated

in the disability or Org-Site rates.

• The one-to-one paraprofessionals that are entered in SEDRA under PTC 53 are also accounted for in this

section of the report.

 Total expenditures are listed, as well as the hours of service provided.

• The special education regular program aid and excess cost aid are deducted from the expenditures.

 The unreimbursed costs of the one-to-one paraprofessionals are in the right-hand column. This

amount is divided by the total hours on line 27.

• The rates will be applied to all the students who are entered in SEDRA service code V which have been

matched to the data reported in MARSS.

• Line 26 takes the salary expenditures times RATIO1 as noted in line 20.

• Line 28 calculates the para nonreimbursable rate by dividing the unreimbursed cost by the number of

paraprofessional service hours on line 27.

Minnesota Department of Education

36 | Page Updated December 2023 Tuition Billing Reference Guide

Note: Be aware that all the hours entered in SEDRA using PTC 53 need to be accounted for by entering the

nonresident students who are receiving those one-to-one paraprofessional services in SEDRA using service code

(

There have been instances where no one-to-one paraprofessional services have been billed because no lines

were entered in SEDRA with service code V.)

Section C – Regular School Year by Disability

These sections show the expenditures for regular school year in SEDRA funding source code “A” based on the

old formula and the UFARS nonfederal expenditures for regular school year. The total expenditure is multiplied

times Ratio 1 from line 20 on the first page to determine the special education aid. Total expenditure minus the

special education aid gives the unreimbursed cost.

Divide the unreimbursed cost by the total services hours from MARSS to determine the unreimbursed rate per

service hours.

All Disabilities – Districtwide Rates

Refer to the last page of the rates calculation report for the “All-Disabilities – Districtwide Rates.” Before you can

review the rates for the disabilities, you need to know the “ceiling” for your district:

• Take the districtwide reimbursable rate times 3.00 to get the maximum rate allowed for your district.

The “ceiling” is the maximum rate that the tuition billing system will apply to your district. If you have rates that

exceed this amount, the tuition billing system will apply the districtwide rate. This is a safeguard

for the districts

to assure that no district will have excess billings because of incorrect or misaligned data. The Minnesota

Department of Education has calculated rates as high as $323,400 per special education service hour. It is

important to note that a rate can exceed the maximum and may be correct. You will have to provide

justification to the Division of School Finance; and, if approved, the rate will be allowed to be billed. If there is

no notice sent to MDE, then the districtwide rate will be used in all situations. The “420 disability” rate will not

be applied if the districtwide rate is used, as those expenditures are already in the districtwide rate calculation.

Section D – Extended School Year

This section has all the expenditures listed in SEDRA for contracted student placements (SEDRA service code C),

one-to-one services, professional, equipment, and contract expenditures

for students, ADSIS) and ACTE-SPED

(Formerly Transition Disabled). The one-to-one professional expenditures are submitted on forms to MDE. The

purpose of this section is to account for the special education program and excess cost aids attributable to those

expenditures. If MDE did not account for those expenditures, the aid would be overstated in the disability rates.

• Th

e one-to-one paraprofessionals that are entered in S

EDRA under funding source code “E,” personnel

type code 53, are also accounted for in this section of the report.

• Total expenditures are listed, as well as the hours of service provided.

• The special education regular program aid and excess cost aid are deducted from the expenditures.

 The unreimbursed costs of the one-to-one paraprofessionals are in the right-hand column. This

amount is divided by the total hours on line 27.

Minnesota Department of Education

37 | Page Updated December 2023 Tuition Billing Reference Guide

• The rates will be applied to all the students who are entered in SEDRA funding source code “E,” service

code V, which have been matched to the data reported in MARSS.

• Line 26 takes the salary expenditures times Ratio 1 as noted in line 20.

• Line 28 calculates the para nonreimbursable rate by dividing the unreimbursed cost by the number of

paraprofessional service hours on line 27.

Note: Be aware that all the hours entered in SEDRA using FSC “E,” PTC 53, need to be accounted for by entering

the nonresident students who are receiving those one-to-one paraprofessional services in SEDRA using service

code V. (There have been instances where no one-to-one paraprofessional services have been billed because no

lines were entered in SEDRA with service code V.)

Section E – Extended School Year by Disability

These sections show the expenditures for extended school year in SEDRA funding source code “E” based on the

old formula and the UFARS nonfederal expenditures for regular school year. The total expenditures is multiplied

times Ratio 1 from line 20 on the first page to determine the special education aid. Total expenditure minus the

special education aid gives the unreimbursed cost.

Divide the unreimbursed cost by the total services hours from MARSS to determine the unreimbursed rate per

service hours.

All Disabilities – Districtwide Rates

Refer to the last page of the rates calculation report for the “All-Disabilities – Districtwide Rates.” Before you can

review the rates for the disabilities, you need to know the “ceiling” for your district: All ESY bill at the

districtwide rate beginning in SFY 16.

• Take the districtwide reimbursable rate times 3.00 to get the maximum rate allowed for your district.

The “ceiling” is the maximum rate that the tuition billing system will apply to your district. If you have rates that

exceed this amount, the tuition billing system will apply the districtwide rate. This is a safeguard for the districts

to assure that no district will have excess billings because of incorrect or misaligned data. The Minnesota

Department of Education has calculated rates as high as $323,400 per special education service hour. It is

important to note that a rate can exceed the maximum and may be correct. You will have to provide

justification to the Division of School Finance; and, if approved, the rate will be allowed to be billed. If there is

no notice sent to MDE, then the districtwide rate will be used in all situations. The “420 disability” rate will not

be applied if the districtwide rate is used as those expenditures are already in the districtwide rate calculation.

Summary

This section lists the total special education aid by category.

Special Education Tuition Billing Organizational-Site (Org-Site) Rate Calculation –

Regular School Year

This rate calculation report uses the data from UFARS, SEDRA and MARSS to calculate the rates by Org-Site.

Minnesota Department of Education

38 | Page Updated December 2023 Tuition Billing Reference Guide

Section A

This section shows expenditures, aid calculations and total special education costs entered in SEDRA used to

determine the adjusted state special education aid. A ratio of expenditures to aid is calculated and used to

determine the unreimbursed cost that will be billed to the resident district for the RSY and ESY.

Section B – Regular School Year

This section has all the expenditures listed in SEDRA for contracted student placements (SEDRA service code C),

one-to-one services, professional, equipment, and contract expenditures for students, ADSIS and ACTE-SPED

(Formerly Transition Disabled). The one-to-one professional expenditures are submitted on forms to MDE. The

purpose of this section is to account for the special education program and excess cost aids attributable to those

expenditures. If MDE did not account for those expenditures, the aid would be overstated in the Org-Site rates.

• The one-to-one paraprofessionals that are entered in SEDRA under PTC 53 are also accounted for in this

section of the report.

• Total expenditures are listed, as well as the hours of service provided.

• The special education regular program aid and excess cost aid are deducted from the expenditures.

 The unreimbursed costs of the one-to-one paraprofessionals are in the right-hand column. This

amount is divided by the total hours on line 27.

• The rates will be applied to all the students who are entered in SEDRA service code V, which have been

matched to the data reported in MARSS.

• Line 26 takes the salary expenditures times Ratio 1 as noted in line 20.

• Line 28 calculates the para nonreimbursable rate by dividing the unreimbursed cost by the number of

paraprofessional service hours on line 27.

Note: Be aware that all the hours entered in SEDRA using FSC “A,” PTC 53 need to be accounted for by entering

the nonresident students who are receiving those one-to-one paraprofessional services in SEDRA using FSC “A,”

service code V. (There have been instances where no one-to-one paraprofessional services have been billed

because no lines were entered in SEDRA with service code V.)

Section C – Regular School Year by Org-Site

These sections show the expenditures for regular school year in SEDRA funding source code “A” based on the

old formula and the UFARS nonfederal expenditures for regular school year by Org-Site. The total expenditures

are multiplied times Ratio 1 from line 20 on the first page to determine the special education aid. Total

expenditure minus the special education aid gives the unreimbursed cost.

Divide the unreimbursed cost by the total services hours from MARSS to determine the unreimbursed rate per

service hours.

All Sites – Districtwide Rates

Refer to the last page of the Org-Site Rates Calculation report for the districtwide rates. Before you can review

the rates for the Org-Site, you need to know the “ceiling” for your district:

Minnesota Department of Education

39 | Page Updated December 2023 Tuition Billing Reference Guide

• Take the districtwide reimbursable rate times 3.00 to get the maximum rate allowed for your district.

The “ceiling” is the maximum rate that the tuition billing system will apply to your district. If you have rates that

exceed this amount, the tuition billing system will apply the districtwide rate. This is a safeguard for the districts

to assure that no district will have excess billings because of incorrect or misaligned data. The Minnesota

Department of Education has calculated rates as high as $323,400 per special education service hour. It is

important to note that a rate can exceed the maximum and may be correct. You will have to provide

justification to the Division of School Finance; and, if approved, the rate will be allowed to be billed. If there is

no notice sent to MDE, then the districtwide rate will be used in all situations.

Special Education One-to-One Paraprofessionals Hours Comparison

This report lists the number of one-to-one paraprofessional hours reported under personnel type code 53 and

the number of one-to-one paraprofessional hours provided to nonresident students served by the district as

reported under service code V.

A district should not have more hours of service reported by students than hours claimed in SEDRA under PTC

53.

f that is the case, the following should be done:

• Review students’ IEPs to determine the correct hours of service each student is receiving.

• Make sure all one-to-one paraprofessional hours have been reported in SEDRA.

If the student service hours appear to be low, it can be one of the following:

• Not all nonresident students were reported in SEDRA under service code V.

• Resident district and MARSS ID (student ID) did not match to what was reported in MARSS.

• Student was not found in MARSS.

Minnesota Department of Education

40 | Page Updated December 2023 Tuition Billing Reference Guide

Appendix A – Guide to Tuition Invoice Data Extract from SEDRA

An Excel version of the table below can be found by going to MDE’s homepage and following this pathway:

Districts, Schools and Educators > School Finance > Special Education> Tuition Billing

(https://education.mn.gov/MDE/dse/schfin/sped/tuit/).

SEDRA

Tuition

Invoice

Excel

Column

n/a

SEDRA Tuition Invoice Field

Calculation/Source

Notes

DATA YEAR

MARSS Record

notes

STUDENT NUMBER

MARSS Record

Notes

SERVING DISTRICT NUMBER

MARSS Record

Notes

SERVING DISTRICT TYPE

MARSS Record

Notes

SERVING SCHOOL NUMBER

MARSS Record

Notes

STUDENT RESIDENT DISTRICT NUMBER

MARSS Record

Notes

STUDENT RESIDENT DISTRICT TYPE

MARSS Record

Notes

STATE AID CATEGORY

MARSS Record

Notes

STATUS BEGIN DATE

MARSS Record

Notes

STATUS END DATE

MARSS Record

Notes

AVG DAILY MEMBERSHIP - 1.0 CAP

MARSS Record

Notes

SPECIAL ED EVALUATION STATUS

MARSS Record

Notes

SPECIAL ED INSTRUCTIONAL SETTING

MARSS Record

Notes

PRIMARY DISABILITY

MARSS Record

Notes

TRANSPORTATION CATEGORY

MARSS Record

Notes

TRANSPORTING DISTRICT NUMBER

MARSS Record

Notes

TRANSPORTING DISTRICT TYPE

MARSS Record

Notes

STUDENT GRADE LEVEL

MARSS Record

Notes

STUDENT NAME

MARSS Record

Notes

SPECIAL ED SERVICE HOURS

MARSS Record

(See Notes)

This is only entered in MARSS for certain

students: (EC, SACs 16-18 and 27) and

those in the following Identified Teaching

Models: Multidisciplinary, Inclusive, and

Program Cooperative Teaching. Please

consult the MARSS Manual for more

details.

TOTAL SPECIAL ED SERVICE HOURS

MARSS Record

(See Notes)

If T > 0, T, otherwise X.

CAPPED SPECIAL ED SERVICE HOURS

Lesser of U or W

notes

Minnesota Department of Education

41 | Page Updated December 2023 Tuition Billing Reference Guide

SEDRA

Tuition

Invoice

Excel

Column

n/a

SEDRA Tuition Invoice Field

Calculation/Source

Notes

TUITION BILL MEMBERSHIP HOURS

MARSS Record

(See Notes)

These hours are based on the MARSS

record, using the number of instructional

days and hours per day (based on site and

grade level) and percent enrolled to

calculate to the hours.

TUITION BILL SERVICE HOURS

W * AI

notes

INACTIVATE RECORD SPACE=ACTIVE

See Notes

This is used for special pupils only. These

are records when the serving district

matches the resident district to calculate

the amount of tuition the resident district

needs to be "made whole" per Minnesota

Statutes, section 125A.515.

PARA SERVICE HOURS

SEDRA "V" Lines

Notes

STUDENT NEEDS SPECIAL TRANSP (Y/N)

MARSS Record

notes

GENERAL EDUCATION REVENUE GOES

TO WHICH DISTRICT

MARSS Record

(See Notes)

N - No-one receives GenEd (example

would be ESY lines since there is no

GenEd).

S - Serving - this happens for open

enrollment unless the serving is a coop

and the program is a graduation incentive.

C - Coop - this happens for students placed

in the coop or when coops run graduation

incentive programs and don't have a fiscal

host.

R - resident - this happens when a student

is placed into a district or charter.

F - Fiscal Host - this happens when a coop

runs a graduation incentive program and

has a fiscal host.

PUPIL UNIT WEIGHTING FACTOR

MARSS Record

Equal to 1.0 for all students below 7th

grade and 1.2 for all students in 7th grade

or higher.

ADJUSTED PUPIL UNITS

K * AC

Notes

INSTRUCTIONAL PERCENT

See Notes

This is based on the LEA's percentage of

Gen Ed costs, as provided in their final

UFARS data.

INSTRUCTIONAL DAYS IN SESSION

MARSS Record

Notes

LENGTH OF SCHOOL DAY IN MINUTES

MARSS Record

Notes

MEMBERSHIP HOURS PER ADM

AF * (AG / 60)

notes

Minnesota Department of Education

42 | Page Updated December 2023 Tuition Billing Reference Guide

SEDRA

Tuition

Invoice

Excel

Column

n/a

SEDRA Tuition Invoice Field

Calculation/Source

Notes

MEAN

See Notes

Based on Combination of M and N. Please

see "Midpoints to Determine Special

Education Services Hours" Chart on MDE

website.

AVG GENED REVENUE + REFER AID

See Notes

Resident District's "General Education

Revenue" MFR Report

AVG GENED BASIC SKILLS REVENUE PER

ADJPUN FOR RES DIST

See Notes

Resident District's "General Education

Revenue" MFR Report

AVG GENED SPARSITY REVENUE PER

ADJPUN FOR RES DIST

See Notes

Resident District's "General Education

Revenue" MFR Report

TOTAL AVG GENED REVENUE + REFER

AID

AJ + AK + AL

Notes

AVG GENED REVENUE + REFER AID

See Notes

Serving District's "General Education

Revenue" MFR Report

AVG GENED BASIC SKILLS REVENUE PER

ADJPUN FOR SERV DIST

See Notes

Serving District's "General Education

Revenue" MFR Report

AVG GENED SPARSITY REVENUE PER

MEMBERSHIP HOUR FOR RES DIST

See Notes

Serving District's "General Education

Revenue" MFR Report

TOTAL AVG GENED REVENUE + REFER

AID

AN + AO + AP

Notes

AVG GENED REVENUE + REFER AID

AJ * AC / AH

Notes

AVG GENED BASIC SKILLS REVENUE PER

MEMBERSHIP FOR RES DIST

AK * AC / AH

notes

AVG GENED SPARSITY REVENUE PER

MEMBERSHIP

AL * AC / AH

notes

TOTAL AVG GENED REVENUE + REFER

AID

AM * AC / AH

notes

AVG GENED REVENUE + REFER AID

AN * AC / AH

notes

AVG GENED BASIC SKILLS REVENUE PER

MEMBERSHIP FOR SERV DIST

AO * AC / AH

notes

AVG GENED BASIC SKILLS REVENUE PER

MEMBERSHIP FOR SERV DIST

AP * AC / AH

Notes

TOTAL AVG GENED REVENUE + REFER

AID FOR SERV DIST

AQ * AC / AH

Notes

REIMBURSABLE RATE

Obsolete Field

notes

Minnesota Department of Education

43 | Page Updated December 2023 Tuition Billing Reference Guide

SEDRA

Tuition

Invoice

Excel

Column

n/a

SEDRA Tuition Invoice Field

Calculation/Source

Notes

NONREIMBURSABLE RATE

See Notes

"Special Education Tuition Billing Regular

School Year Rate Calculation" MFR Report

Section C

-OR-

"Special Education Tuition Billing

Organization Site Rate Calculation" MFR

Report Section C

REIMBURSABLE RATE - 420 SERVICES

Obsolete Field

Notes

NONREIMBURSABLE RATE - 420

SERVICES

See Notes

"Special Education Tuition Billing Regular

School Year Rate Calculation" MFR Report

Section C

REIMBURSABLE RATE - TOTAL

Obsolete Field

Notes

NONREIMBURSABLE RATE - TOTAL

BA + BC

Notes

1 TO 1 PARA REIMBURSABLE RATE

Obsolete Field

notes

1 TO 1 PARA NONREIMBURSABLE RATE

See Notes

"Special Education Tuition Billing Regular

School Year Rate Calculation" MFR Report

Section B

-OR-

"Special Education Tuition Billing

Organization Site Rate Calculation" MFR

Report Section B

INITIAL COST REIMBURSABLE

See Notes

This happens when an LEA submits the

one-to-one professional or equipment

form and MDE tacks a specific SEDRA line

to a MARSS student. The unreimbursed

cost from the SEDRA line will show up in

this column. The Status Begin Date

(Column I) will be the SEDRA Line number

and not a date.

INITIAL COST NONREIMBURSABLE

BE * U + BG * Z

Notes

INITIAL COST TOTAL

BI + BH

Notes

INSTRUCTIONAL PORTION OF GENED

REVENUE PER SERVICE HOUR

If M < 3 or AB = "N"

, 0

If M > 2 and AB =

"R,” (AR + AW + AT)

* AE

If M > 2 and AB =

"S" or "F,” AY * AE

If M >2 and AB =

"C,” (AR + AS) * AE

notes

Minnesota Department of Education

44 | Page Updated December 2023 Tuition Billing Reference Guide

SEDRA

Tuition

Invoice

Excel

Column

n/a

SEDRA Tuition Invoice Field

Calculation/Source

Notes

SPECIAL ED COST FUNDED WITH

INSTRUCTIONAL PORTION OF GENED

REV

BK * V

This is often referred to as the "Gen Ed

Defray."

SUBTOTAL NET SPECIAL ED TUITION

COSTS

(BJ - BL ) * 0.90

See Notes

90 percent is applied only if the LEA is

subject to the 90/10 rule (see column CM)

NET TUITION COST REIMBURSABLE

Notes

NET TUITION COST NONREIMBURSABLE

BM - BN

Notes

GENED TUITION COST

If AB = "R,” AD * AJ

If AB = "C,” AD *

(AJ +AK)

notes

APPEALED GENED RATE

See Notes

Gen Ed appeal rate under Minnesota

Statutes, section 125A.11, subdivision 1

(c).

GENED TUITION COST - APPEALED

ADDITIONAL

W * BQ

notes

GENED TOTAL TUITION COST

BP + BR * 0.90

See Notes

90 percent is applied only if the LEA is

subject to the 90/10 rule (see column CM)

DEBT SERVICE RATE

See Notes

This field is currently not used to calculate

tuition rates.

LEASE RATE

See Notes

This field is currently not used to calculate

tuition rates.

DEBT SERVICE TUITION COST

See Notes

This field is currently not used to calculate

tuition rates.

BUILDING LEASE TUITION COST

See Notes

This field is currently not used to calculate

tuition rates.

TRANSPORTATION RATE

See Notes

If a district or charter spends more on FIN

723 in the current year than they did in

the prior year, the rate report will

calculate an unreimbursed SPED

transportation rate (it uses the

membership hours of students reported

with transportation category 03) to be

used here.

TRANSPORTATION TUITION COST

W * BX

See Notes

90 percent is applied only if the LEA is

subject to the 90/10 rule (see column CM)

AMOUNT TRANSFER TO SERVING

DISTRICT

BM + BS

Notes

AMOUNT TRANSFER TO TRANSP

DISTRICT

Notes

AMOUNT TRANSFER FROM RESIDENT

DISTRICT

BZ + CA

notes

Minnesota Department of Education

45 | Page Updated December 2023 Tuition Billing Reference Guide

SEDRA

Tuition

Invoice

Excel

Column

n/a

SEDRA Tuition Invoice Field

Calculation/Source

Notes

REIMBURSABLE RATE SOURCE

Obsolete Field

Notes

NONREIMBURSABLE RATE SOURCE

Obsolete Field

Notes

REIMBURSABLE RATE 420 SOURCE

Obsolete Field

Notes

NONREIMBURSABLE RATE 420 SOURCE

Obsolete Field

Notes

PARA REIMBURSABLE RATE SOURCE

Obsolete Field

Notes

PARA NONREIMBURSABLE RATE

SOURCE

Obsolete Field

Notes

TRANSPORT RATE SOURCE

Obsolete Field

Notes

DEBT SERVICE RATE SOURCE

Obsolete Field

Notes

BUILDING LEASE RATE SOURCE

Obsolete Field

notes

USE SPECIAL ED SERVICE HOURS ONLY

ON INVOICE CALCULATION (Y/N)

MARSS Record (See

Notes)

Number of SPED service hours are

reported in MARRS for Students in Team

Teaching, Inclusive Instructional Setting

and Multidisciplinary Teaching models and

are used in lieu of the midpoints (AI).

SUBJECT TO 90/10 RULE

See Notes

Serving district responsible for 10 percent

of unreimbursed costs, unless placed by

resident district or charter school with

high SPED concentration. 125A.47 Subd 7

(c and d).

In SFY 2020, serving district is responsible

for 15 percent, and in SFY 2021 and later

serving district is responsible for 20

percent.

DATE OF RUN SAVED

See Notes

The date that MDE Special Ed Funding ran

the Tuition Billing calculation; generated

by SEDRA.

APPEALED GENED RATE 2

See Notes

This has never been used.