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EDUCATION OF THE HANDICAPPED

ISSUE BRIEF NUMBER IB78040

AUTHOR:
Angela Evans

Education and Public Welfare Division

THE LIBRARY OF CONGRESS
CONGRESSIONAL RESEARCH SERVICE

MAJOR ISSUES SYSTEM

DATE ORIGINATED 04/21/78

DATE UPDATED O2/O9/83

FOR ADDITIONAL INFORMATION CALL 287-5700

0216

CRS- 1 IB78040) UPDATE-O2/O9/83

TSUE DEFINITION

Federal involvement in the education of the handicapped increased
significantly with the enactment of the Education for All Handicapped

.Children Act (EHA) of 1975 (P.L. 94-142) in the 94th Congress. This’

legislation amended the provisions for State assistance under Part B of the
Education of the Handicapped Act (P.L. 91-230, Title VI, as amended) to
require that a "free appropriate public education" be available for all
handicapped children age 3 through 21 by September 1980. P.L. 94-142
authorized increased Federal financial assistance along with new requirements
for participating State agencies and local school districts. Current issues
relating to Federal policy for the education of the handicapped include
concerns about costs and responsibilities in educating the handicapped, about

the level of Federal financial support, about’ the characteristics of
handicapped children actually identified and served, about the implementation
of P.L. 94-142 requirements by State and local school districts, .and about

Administration proposals to revise Part B regulations.

BACKGROUND AND POLICY ANALYSIS

Part B of the Education of the Handicapped Act, (EHA), as amended by P.L.

_94-142, provides Federal financial assistance to States for the education of

p

to 2l-year-old children having one or more of nine physical or mental
disabilities ranging from learning disabilities to severely and profoundly
handicapping conditions. The level of Federal assistance is based on an
annual count of handicapped children being served by appropriate educational
programs and is intended to pay a percentage of the excess costs associated
with educating handicapped children. Payments to States are affected by the
authorized Federal reimbursement ceilings (40% of the national average per
pupil expenditure) and the annual congressional appropriation. Approximately
four million handicapped children are currently participating in State and
local special education programs that qualify for Federal assistance. The
1982-1983 school year Federal contribution under Part B is $931 million or
about $238 per student.

Current educational rights of handicapped children were established
initially in two major State level suits, i.e., PARC (Pennsylvania

Association for Retarded Citizens) v. Commonwealth of Pennsylvania and Mills

v. D.C. Board of Education, both of which addressed the exclusion of certain
handicapped children from any educational instruction and the lack of
appropriate educational programming for certain handicapped children. These
basic rights have been-modified in subsequent State court decisions regarding
various aspects of a handicapped child's ,right to an educational program
designed to meet his or her individual educational needs. In addition, at
the national level, two Federal laws are intended to assure certain rights to
handicapped persons. Section 504 of the Rehabilitation Act prohibits any
program or activity receiving Federal assistance from discriminating against
a'" persons because of a handicapping condition. Part B of EHA, as amended
b_ P.L. 94-142, requires that each State participating in the State grant
program provide a "free appropriate public education" to all handicapped
children 3-21 years of age in the "least restrictive environment."

CRS- 2 1 "IB?8040 UPDATE-02/O9/83

As States and local school districts have worked to comply with both their
own legislative and judicial mandates and the requirements of P.L. 94-142 and
Section 504, a number of concerns have emerged:

—- What is the estimated total cost of providing free
appropriate public education for all handicapped
persons aged 3-21?

-- What is the precise legislative intent of P.L. 94-142
and what have been its actual effects thus far?

-- What is the level of additional State and local
revenue necessary to provide full educational
services for all handicapped children and how will
such additional revenues be raised?

-- What is the level of Federal funding commitment for
P.L. 94-142 and other special education legislation?

-- What is the best way to implement the various
requirements of P.L. 94-142 and Section 504 of the
Rehabilitation Act of 1973?

-- What is the best way to educate all handicapped
children within each State in order to achieve both
State and Federal education objectives?

These concerns are briefly examined under four issues:_ (1) costs and
responsibility for educating all handicapped children, (2) the level
Federal funding, (3) handicapped children identified and served, and (4)
implementation of P.L. 94-142 requirements.

ISSUG 1: COStS and Responsibility for Educating All Handicapped Children

States and their local school districts have the primary iresponsibility
for the education of handicapped children of elementary and secondary school
age, with Federal involvement in- this area primarily the result of
legislation enacted over the past 15 years.

It is estimated that in the 1981-1982 school year, States and local school
districts spent in excess of $6.5 billion for basic instruction and
supplemental education services for the approximately four million
handicapped children enrolled in public schools or State programs. In
addition, the Federal Government contributed over $1 billion in special
education support to States and local school districts for the education of
handicapped children. The following totals indicate the amount of Federal
funds which are available for use during the 1981-82 school year under
selected education programs (administered by the Department of Education)
that have specific authorizations for the education of the handicapped:
These figures reflect the FY81 Appropriation. (Note: Most Federal education
programs, including the Part B program, are either advance- or
forward-funded, i.e., funds provided in an appropriation act or a continui ?
resolution for one year are primarly used to provide education services ~-
thus are actually spent or outlaid -- the following year. Therefore, the
FY82 appropriation for Part B was obligated by ED for use in the current
school year, 1982-1983.)

CRS- 3 IB78040 UPDATE-O2/O9/83

Education of the Handicapped Act:

Part A —- Removal of Architectural Barriers $ 0
Part B;-- State Grants 931,008,000
Part B -- Preschool Incentive Awards 24,000,000
Parts C, D, E, F ll3,572,000

Elementary and Secondary Education Act: I
Title I, Subpart 2 -- Programs for Handicapped
Children in State Supported Schools l46,520,000

Public Law 81-874:

Title I -— Financial Assistance for Local
Educational Agencies in Areas Affected
by Federal Activities (special Section
3 entitlement rate for certain
handicapped children) 30,000,000 est.

Vocational Education Act
Part A -— State Vocational Education Programs
(Section ll0 handicapped priority) 59,500,000 est.

At the State and local level, a number of factors influence attempts to
cost-estimate or to implement a full service educational program for all
handicapped children. Among these factors are the following:

-- The actual number of handicapped children identified and
served within each State. (See Issue 3: Handicapped
Children Identified and Served, for further discussion).

-— Type of handicapping condition served. Since different
types of handicapping conditions require different average
levels of expenditure, the incidence of various
handicapping conditions among the children in
each State will influence total costs.

-- Type of special education program._ Even under a least
restrictive environment approach as required under
P.L. 94-142, the exact type of handicapped program
provided by a State or local agency may vary significantly
in terms of total cost per pupil.

-- Quantity and quality of special education services
provided. '

In a 1979 survey of selected school districts ("A Survey of Special
Education Costs in Local School Districts"), the National School Boards
Association (NSBA) found that a school district would spend twice as much on
average ($3,638) to educate a handicapped_pupil as a member of the "regular"
student population ($1,819) in the_l979-80 school year. NSBA also found that
w‘ n school systems had to place handicapped students in facilities outside
Ol‘PUbliC schools, the average cost for a nonresidential private school
placement could be four times the cost of educating a regular student while
the average cost for a residential school placement would be eight times this
regular expenditure. ~ I

CRS- 4 IB78040 UPDATE-O2/O9/83

More recently, a report estimating the cost of .educating handicapped
children was published by the Institute for Research on Educational Finan
and Governance at Stanford University. It was estimated that special
education instructional and related services costs for school-age handicapped
students in 1980-1981 were approximately $8.0 billion. The report estimated
that, on the average, it would cost approximately $1,400 above the equivalent
costs of regular education to educate a handicapped student, or approximately
$3,700 per handicapped child for total educational costs.

Finally, according to ED the estimated average handicapped per pupil
expenditure for the 1982-1983 school year is $5,553, over double the
estimated average nonhandicapped per pupil expenditure estimated by ED for
this same year of $2,559.

How individual States and their local school districts -finance increased
costs in the area of special education in the years ahead appears to depend
largely on financial decisions made within each State and on the level of the
Federal contribution. Generalizations of past spending trends by States and
localities may be an inadequate means of predicting future expenditures for
program areas. Several unpredictable factors could influence spending
priorities within a State or locality, i.e., changes in State law which may
affect the direction and scope of a State's participation in a program;
recent State and local budget constraints which may redirect educational
expenditures to other areas; and the effect of Federal program funding cuts
in areas other than education which may have an indirect impact on education
budgets. (See Issue 2: Federal Funding, for further discussion). whatever
the disposition of these financial considerations, however, the fin"
responsibility for meeting both the State and Federal mandates for speci.,
education rests with the States and their local agencies. In the end, it is
the States and their school districts that have the primary responsibility to
provide free public education for all handicapped children.

Issue 2: Level of Federal Funding

Under the provisions of P.L. 94-142, the Part B distribution formula is
based on the number of handicapped children, 3-21 years of age, receiving a
free public education in a State, multiplied by a percentage of the national
average per pupil expenditure (APPE) that increased from 5% in FY78 to 40% in
FY82 and succeeding fiscal years. Under this formula, the authorization of
appropriation ceiling for the Part B program for FY82 would be $4.1 billion,

Fassuming four million children participate in the program and that the FY83

APPE is $2,559 (ED estimates). However, the Omnibus Budget Reconciliation
Act of 1981 (OBRA) placed authorization of appropriation ceilings on the Part
B program for FY82 through FY84 which are well below the authorizations
established by P.L. 94-142, i.e., $969.9 million for F382 and $1 billion for
each of the fiscal years 1983 and 1984.

The level of Federal funding. when P.L. 94-142 was enacted, some felt
that the magnitude of providing a free appropriate public education for all
handicapped children aged 3-21 also implied a Federal commitment to fund the
new Part B, State grant entitlement formula annually and fully in the ye. 5
ahead.

For each of school years 1977-78 and 1978-79, .the’ first 2 years after
implementation of P.L. 94-142, total Part B appropriations were sufficient to

CRS- 5 IB7804O UPDATE-O2/O9/83

pay the full authorization for the program. Beginning in school year 1979-80

and continuing through the current school year 1982-83, appropriations have

been insufficient to meet the authorization of appropriation ceilings
tablished by P.L. 94-142.

The following table summarizes the estimated number of children served and
the relative levels of Federal support since the passage of P.L. 94-142.

Fiscal
Year

l977

l978

l979

1980

l98l

1982

1983

CRS- 5 IB78040 UPDATE-02/09/83
Actual
Funded % of funded
Children Federal APPE authorized % of
served funding under P.L. 94-142 of APPE
3,485,000 $251,769,927 5 5.1
3,561,000 566,030,074 10 10.1
3,700,000 804,000,000 20‘ l2.5
3,803,000 874,500,000 “ 30 12.0
3,941,000 874,500,000 40 l0.0
4,000,000 E1 931,008,000 Q1 40 31 9.0
4,000,000 31 970,000,000 Q1 40 c/ 8.0

ED estimate.  

Based on P.L. 97-161, Further Continuing Appropriations Resolution
for FY82 (H.J.Res. 409) signed into law, P.L. 97-l6l, providing
funding through Sept. 30, l982 for EHA programs as well as other
ED programs and P.L. 97-257, Supplemental Appropriations for FY82
(H.R. 6863). 4

Authorization separately limited to $969.9 million for FY82

under the Omnibus Budget Reconciliation Act of 1981.
Based on P.L. 97-377, Further Continuing Appropriations,
providing funding through Sept. 30, l983.

FY83,

(younger),

majority,

“children between the ages of birth through 21 in the United States.

.for some reason.

~94—l42 mandate to educationally serve all handicapped children aged 3-21

_retarded as compared With 17%

CRS- 7 IB7804O UPDATE-O2/O9/83

‘T*sue 3: Handicapped Children Identified and Served

when P.L. 94-142 was enacted in 1975, the best estimates available to
Congress indicated that there were approximately 8 million

the
handicapped
The most
that in
between

indicates
children
local agencies.

recent information available from the States, however,
1981-82 there were approximately four million handicapped
the ages of 3 through 21 being served by State and

Where are the remaining 4 million handicapped children that are
not recorded as receiving educational services at either the State or local
level, including many for whom the States are now responsible for providing a
"free appropriate education"? Some of these children are not in school
altogether, especially those in the birth-6 and 18-21 age ranges. some of
these "missing" children are in various private institutions and thus do not
appear in public school and State institution totals. Presumablyy some of
these unreported children have handicaps that remain undiagnosed. In
addition, some of the older children are already enrolled in higher education
or vocational institutions and thus do not appear in the elementary and
secondary education reports. Possibly, some of these handicapped children are
in State hospitals or other institutions that provide no educational services
And possibly, the 7.9 to 8 million estimated total of
handicapped children aged 3-21 is inaccurate. Whatever the combination of
reasons, the assumption is that both the State court decisions and the P.L.
has

1 to increases in State and local totals of handicapped children receiving
instruction. Yet exactly how many additional handicapped children of the
estimated maximum of 4 million "unserved" will eventually be "found" and
provided service in each State still remains a matter for conjecture.

currently

Another aspect of this issue focuses on the characteristics of those
children currently receiving special education. Findings across various
recent studies indicate that the "typical" child participating in public
school special education programs is young (about 67% are 12 years of age or
male (twice as many males and females receive special education)
and mildly handicapped (in school year 1980-81 .about 13% of the children
served had severe handicaps, 36% had moderately severe handicaps, and the
51%, had mild handicaps). In addition, learning disabled children
exceed the number of children in any other category of handicapping
condition; in six States over half of the handicapped children counted as
receiving special education services under P.L. 94-142 are learning—disabled.
Recent studies have also shown a disproportionate number of minority children
participate in some special education programs (41% of black students in
special education in 1978-79 were in classes for the educable-mentally
of Hispanic students and-6% of white students).
Males are three times as likely as females to be found in programs for the
seriously emotionally disturbed and two and one-half times as likely as

females t0 be in learning disabled programs.

Explanations regarding the disproportionate representation
g ups of students in special education programs include: variations within
and among States with regard to the type and severity of the handicap of
those children identified as learning disabled, the preference of teachers to
identify a child as learning disabled over identifying a child as mentally
retarded, the existence of racial bias in the identification and assessment

of certain

CRS- 8 IB7804O UPDATE-O2/O9/83

of minority children for special education, and sexual bias which may result

in misidentifying social maladjustment or misbehavior as emotional
disturbance. There has been no conclusive evidence which explains tr
nature, cause or scope of any one of these problems. Studies have also

concluded that there are children in school who need but are not receiving
special education; the data currently available are inadequate to estimate
the size of this group.

Issue 4: Implementation of P.L. 94-142 Requirements

In 1975, P.L. 94-142 substantially amended‘ the Part B -- State grant
program authorized under the Education of the Handicapped Act by revising
both the State grant entitlement formula and the State and local agency
program requirements. Since enactment _of this legislation, a number of
concerns regarding the implementation of P.L. 94-142 have emerged. Among
such concerns are the:

'-— Apparent general "prescriptiveness" of a number of
provisions under P.L._94-I42;

-- Emphasis on a "least restrictive environment" in providing
educational services to the handicapped;

-- Adequacy of teacher preparation for educating all,
handicapped children in a least restrictive setting;

-— Development and significance of the individualized
education program required for each handicapped
Child;

-- State administrative accountability and potential
problems with the due process procedures under
P.L. 94-142;

-- Precise determination of the number of children with
"specific learning disabilities" entitled under the
Part B -- State grant program;

-— Problems in the provision of related service.

States and their local school districts are also affected by Section 504
of the Rehabilitation Act of 1973. Section 504 prohibits any program or
activity receiving Federal assistance from discriminating against any person
because of a handicapping condition.

Is P.L. 94-142 "too prescriptive"? In View of the primary responsibility
of States and local school districts to provide educational opportunities for

all handicapped children, one general concern that seems to pervade
discussion of the implementation of P.L. 94-142 is whether some of the
Federal requirements -- such as the due process provisions -- are too

prescriptive on States and their local school districts.

some State_and local educators appear to feel the answer is "yes,"
especially when the Federal requirements clash with differing State or local
procedures. Others-respond that the answer is "no" because precise Federal

CRS- 9 IB78040 UPDATE-02/D9/83

requirements are the only way to insure that all handicapped children have
access to equal educational,opportunities.

Least restrictive-environment. P.L. 94-142 requires that each State
establish procedures that assure -- to the maximum extent appropriate -- that
handicapped children (including those in public or private institutions or
other care facilities) be educated with children who are not handicapped.

.Furthermore, special classes, separate schooling, or the removal of

handicapped children from the regular education setting is to be provided
only when the nature or severity of the handicap is such that education in
regular classes, with the use of supplementary aids and services, cannot be
satisfactorily achieved.

In the view of some State educators and organizations, P.L. 94-l42 appears
too prescriptive in instituting a least restrictive environment, or
"mainstreaming" approach. Such critics feel that the choice of method for
providing educational services for the_ different types of handicapped
children should remain a state prerogative. some also state that a
mainstreaming approach will not prove satisfactory without a significantly
increased funding commitment to special education training for the regular
classroom teacher. In addition, some educators fear that mainstreaming might
be instituted without sufficient teacher preparation, thus leading to a
negative result for both handicapped and non—handicapped school children.

Adequate teacher preparation.g The necessity of adequately trained
classroom teachers continues to be a key ingredient for successful education
of the handicapped child. Many school districts continue to have difficulty

yin hiring sufficient numbers of adequately prepared special education

"' 1Ch€rS.

Among others, the National Association of State Boards of Education has
indicated that P.L. 94-I42 does not adequately couple the "least restrictive
environment" approach with proper teacher training. In addition, the
National Association has noted that, while P.L. 94-142 places top priority on
educating handicapped children not yet served, these children often are the
most severely handicapped and there is an insufficient number of trained
teachers for them. According to ED, some 60,000 additional teachers are
needed to adequately staff special education programs.

Individualized Education Program (IEP). P.L. 94-142 requires that local
school districts develop an individualized education program for each
handicapped child. This IEP is to include a written statement of the present
levels of educational performance of the child, of annual and short term
instructional goals, and of particular services to be provided and the extent
to which the child is to participate in the regular school program. In
addition, the IEP ism to include a projected date for the start and
anticipated duration of education services, and evaluation procedures to
determine whether instructional objectives are being achieved. In each case,
the IEP is to be developed by the child's parents or guardian, teacher, a
representative of the school district, and whenever appropriate, the
handicapped child.

one area of continuing concern remains the estimated cost of developing
the IEP. It has been argued that the IEP requirement be deleted from P.L.
9 142 unless more Federal funds are made available for its implementation.
Others respond that this is true only if States insist on placing the IEP on
top of the placement and classification systems already in place. In fact,
some argue that use of the IEP could ultimately require fewer people, less

CRS-l0 IBT804O UPDATE-O2/09/83
paperwork, and less professional time than current placement systems.

State responsibility and due process. P.L. 94-142 requires that the Sta”
educational agency (SEA) be responsible for assuring that the Section 612
eligibility requirements are carried out and that all education programs for
handicapped children within the State, including those administered by other
State or local agencies, are under the general supervision of the SEA
personnel who are responsible for handling educational programs for
handicapped children. Questions have been raised concerning both the wisdom
of such centralized administration and possible jurisdictional conflicts in
some States in attempting to carry it out. (See #2 of the Evaluation section
of this brief for a further discussion of this issue.) The Department of
Education, however, has noted that the States have flexibility in meeting
these requirements under the Federal regulations.

P.L. 94-142 also prescribes procedures for due process hearings and
appears to safeguard the rights of handicapped children and their parents

with respect to provision of a free appropriate public education. A number
of States, however, have established due process procedures of their own that
appear to differ from the Federal requirements under P.L. 94-142. As a

result, there seems to be a real potential for difficulty in cases where
there are conflicting State and Federal procedures.

Serving children with Specific Learning Disabilities (SLD). Because -the
Education for All Handicapped Children Act, P.L. 94-l42, now covers learning
disabled children in its definition of "handicapped", it is a particularly
difficult problem to identify and try to serve those children under Part B --

State grant program. when P.L. 94-142 was passed, it was determined that t*~

category of learning disabled was "too soft" and therefore vulnerable
overlabeling. Testimony from the Office of Education indicated that the
entire lower quartile of any normal class might be classified as having
learning disabilities. Therefore, a 2% limit was placed on the number of SLD
children who could be counted for allotment purposes under the Part B --
State grant formula until such time as Federal regulations were published
that defined and gave criteria for identifying learning disabilities. On
Dec. 29, 1977, these Federal regulations became final, but controversy over
the criteria used for determining the existence of a specific learning
disability remains. (See Issue 3 -- Handicapped Children Identified and
Served -- above for a more detailed discussion of this issue.)

Provision of Related Services

P.L. 94-142 requires that in addition to such special education services

as are specified under each child's IEP, such related services as are
necessary to assist the child in benefiting from the special education
services also must be provided. As defined under the legislation, required
related services include transportation and such developmental, corrective,
and other supportive services as speech pathology and audiology,
psychological services, physical and occupational therapy: recreation, early
identification and assessment of disabilities, counseling services, medical
services for diagnostic or evaluative purposes, school health services,
social work services in schools, and parent counseling and training.

In the first six years of program operations under P.L. 94-142, the
provision of required related services has proven to be one of the most
difficult and costly problems encountered by local school districts.

Numerous problems have arisen with regard to exactly what "mix" of related

CRS-ll IB7804O UPDATE-O2/O9/83

services must be provided for each handicapped child attending public or
private schools and what agencies are responsible for paying the costs of
providing needed related services.‘ As a result of these problems, many

hool districts are cautious in their related services commitments,

,especially in States where local or State departments of health, mental

hygiene, etc., have withdrawn payments for related services once a State or
local educational agency has assumed responsibility for the education of a

.handicapped child who was previously not under State or local educational

agency care. Recent studies conclude that some children are excluded from
special education and others not provided adequate services because of fiscal
limits on school distincts' programs relative to the need for such services.

Evaluations

Evaluations of the State grant (Part B) program, although varied in scope
and direction, have basically focused upon the ability of State and local
educational agencies to implement the new and extensive revisions made to
this program in l975 by P.L. 94-142 -- The Education of All Handicapped
Children's Act. Success of the program has therefore been measured more in
terms of how State and local agencies‘ have accommodated the Federal
legislative changes rather than how Federal program requirements have either
raised the academic achievement of or enhanced equal educational
opportunities for handicapped school-aged children. The three most recent
evaluations of this program are discussed below.

1. General Accounting Office: Disparties Still Exist in Who Gets Special

Education, September 1981. 130 p. In this report, the General Accounting

fice (GAO) analyzed 15 evaluation studies and two data bases to determine
lI the goal of providing special education to handicapped children, as
defined in the Federal legislation, was being met. This study found that
while more children receive special education than ever before, access for
some children remains a matter of chance. A child's home State, handicap,
race, sex, school district, teachers, and parents all can determine whether
and how well the child is served by special education. The report concludes

that while not all children have equal access to special education, the
primary congressional objective -- that those most in need of services would
receive them 3- has largely been accomplished. Fewer and fewer  of
handicapped children that schools know about are denied an education. But

one reason some children have a better chance than others to receive special
education is the type and degree of handicapping conditions which are
included in varying State definitions of what constitutes a handicap for
purposes of participation in the Federal program. The report also concluded
that racial and ethnic minorities are "over-represented" (in comparison with
their proportion of the overall youth population) in some disability
categories: blacks in educable mentally retarded, American Indians in
learning disabled and Asian Americans in speech impaired. Males of all races
are "over-represented" in all categories, particularly in the learning
disabled category.

Other findings of the GAO report are that some children are excluded from
special education because not enough programs are available, and that the
resources of a school district affect access to special education. Further,
f’? report concluded that local school districts have had to limit their

.p_ograms because Of a shortage Of funds. The report also noted that there iS

a lack of consistencyi between children defined as eligible for special
education by P.L. 94-142 and State policies currently in effect.

CRS-12 IB78040 UPDATE-02/O9/83

2. Education Turnkey Systems, Inc: P.L. 94-142 -- A_ Study of the
Implementation and Impact at the State Level, Executive summary, Fall, 1981.
10 p. This study found that the provision of "related services" as mandat
under P.L. 94-142 (these are services supplemental to educational services

which help a child benefit from special education, such as transportation,
developmental, corrective or other support services) is becoming a relatively
"uncontrollable" expenditure for States and localities. For example, the

study found that a full quarter of one State's school transportation budget
is spent on handicapped children who make up only 3% ‘of the total school
population. The study also reports that "turf" battles have developed
between State education agencies and other State agencies over who should
ultimately take responsibility for providing other-than-educational services
to handicapped children. Some State non-educational agencies have totally
eliminated aid to handicapped students because they theorized that
educational agencies were receiving more than enough P.L. 94-142 fundsl to
take responsibility for these services.l

3. Rand Corporation, The Cost of Special Education: Summary of Findings,
November, 1981, 56 p. This report deals with the cost of‘ educating
handicapped children. The results of this study, which used data from the
1977-1978 school year, indicate that it cost an additional $7 billion
nationally, an estimated 2.7 times as much to educate the average handicapped
child as it did to educate the average non-handicapped child. The cost ratio
(handicapped compared to non-handicapped children) varied by age level from
1.98 at the elementary level to 2.48 at the secondary level. The" cost
weighing factor varied by age level ranging from 1.98 at the elementary level
to 2.48 at the secondary level. It varied by type of handicap from 1.37 for
speech impaired children to 5.86 for functionally blind children. It vari
by type of educational placement from .55 for students working full-time
under the auspices of the special education program, rather than attending
classes, up to 3.24 for students in special day schools for handicapped
pupils. The study concludes that all of the above factors must be considered
in determining the total cost of special education to State and local
educational agencies.

The study also identified the highest cost per handicapped child, on the
average, which was $743 for instruction provided by regular education
teachers in the regular classroom setting. In addition, related services
cost an average of $191 per child, assessment and identification $100 per
child, and general district level and school level administration together
cost approximately $400 per child.

Activity in the 97th Congress, 2d Session

The Reagan Administration's FY83 budget request proposed reductions in
budget authority for education of the handicapped programs in both FY82 and
FY83, and a consolidation of all programs currently -authorized under the
Education of the Handicapped Act. For FY82, the Administration requested a
rescission of $256 million, or 28%, for the education of the handicapped
State grant program. This would have resulted in a reduction in the average
Federal payment for about four million handicapped children from $218 to $168
per child. For FY83, funding for the education of the handicapped w's
proposed to be reduced by 19% compared to FY82 and a consolidation of t ;
programs would take place, resulting in a reduction in the FY82 average
Federal payment ,for about 4.5 million handicapped children currently
participating in the programs proposed for consolidation from $246 to $180,
and reducing the Federal share of the aggregate average per pupil expenditure

CRS-13 ~ IB7804O UPDATE-O2/O9/83

for these programs from 10% to 7%. .According to the FY83 documents,
legislation was planned to (l) consolidate Part B, State Grants and Preschool
Incentive Grants currently authorized under the EHA, and the chapter 1

ndicapped program (State-operated programs for the education of the

,handicapped) authorized under the Education Consolidation and’ Improvement AC1’.

of 1981, into a single special education grant; and (2) consolidate the
discretionary projects currently authorized under the EHA into a special

«purpose authority providing the Secretary of ED with the discretion’ to fund

any or all of the discretionary activities. Budget authority for all of
these programs would be reduced from the FY82 level of $l.2 billion to $846
million for FY83 under the Administration's request. No formal proposal was
submitted on this consolidation by the Administration in the 97th Congress.
(For a more detailed discussion of funding issues for ,FY82 and FY83, see
IB820l9: Education: FY82 and FY83 Funding Issues.)

FY83 Funding. At the end of the 97th Congress, programs authorized under

_the Education of the Handicapped Act were funded at $l,llO,252,000 under a

further continuing appropriations resolution, P.L. 97-377 (H.J.Res. 631),
through the end of FY83 (Sept. 30, 1983). The FY83 funding levels for the
various programs are as follows: Part B, State grant program: $970 million;
preschool incentive awards: $25 million; deaf-blind centers: $15.4 million;
severely handicapped projects: $2.9 million; early childhood education
projects: $16.8 million; regional education programs: $2.8 million;
innovation and development: $12 million; media services and captioned films:

’$l2 million; regional resource) ccenters: $2.9 million; recruitment and‘

information: $.7 million; special education personnel development: $49.3
million; and special studies: $.5 million. The FY83 funding level provided

.under P.L. 97-377 for the education of the handicapped programs represents an

crease of $41.7 million over the FY82 level and $264.6 million above the
heagan Administration's budget request for FY83. (See: IB820l9 --
Education: FY82 and FY83 Funding Issues.)

Proposed Regulations for the Part B Program

On Aug. 4, 1982 ED published proposed regulatory changes for the Part B
program. In a statement by ED accompanying the proposed regulations, it is
argued that the changes would eliminate "excessive paperwork requirements and
regulatory detail that result in expenditure of time and resources on
administrative activities", while "maintaining the key procedural protections
and rights of handicapped children and their parents." In general, the
proposed regulations would delete most of the detailed requirements in the
current regulations while maintaining some of the more general provisions.
Significant changes in the current regulations relating to definitions,
related services, timeline requirements for IEPs and due process hearings,
the provision of a free .appropriate .public education, the procedural
safeguards and due process protections, and the least restrictive environment
are proposed; The proposed regulations would add several provisions in areas
that are not addressed in current regulations, such as the issue of

_discipline of handicapped children and the allowance that a local agency may

consider how the handicapped child's behavior may disrupt non-handicapped
children before placing a handicapped child in a regular class.

On Nov. 3, 1982, Secretary Bell officially announced in the Federal
R gister the withdrawal of certain sections of the proposed regulations and
the insertion of certain current regulatory sections in their stead for six
areas: parental consent prior to evaluation or initial placement, least
restrictive environment, related —services, timelines, attendance of

CRS-14 IB7804O UPDATE+02/09/83

evaluation personnel at IEP meetings and qualifications of personnel. In
addition to the announced withdrawal of certain proposed regulations, the
Secretary extended the period for comment on modifications, occasioned by t

withdrawals, from Nov. 4, l982 to Dec. 3, l982. The notice in the Federal

‘Register also announced the intention of the Secretary to publish a single

revised Notice of Proposed Rulemaking (NPRM) for this program after a review
of the comments is made. It is not clear from the announced modifications
whether those areas withdrawn from the proposed regulations would be subject
to other revisions when a new NPRM is published. (For a more detailed
description of the proposed regulations see, CRS White Paper, "Summary of the
Proposed Regulatory Changes to Selected provisions of the Education of the
Handicapped Act -- State Grant Program," by Angela Evans and CR8 White Paper,
"Analysis of the Department of Education's Withdrawal of Sections of Proposed
Regulations under P.L. 94-l42, the Education of All Handicapped Children
Act," by Angela Evans and Nancy Lee Jones.

For two years, the Administration has proposed major funding reductions
and consolidations for Federal special education programs. The FY84 budget
request, however, would maintain overall funding for programs -authorized
under the Education of the Handicapped Act (EHA) at the FY83 funding level of
$l.ll billion. The FY84 request would shift funds from certain EHA
discretionary programs, which are special projects funded directly by the

 Federal Government, to the EHA basic State grant program, which is

distributed to States and through them to local agencies to help finance
special education. The FY84 request would increase the State grant program
to $998 million from the FY83 level of $970 million, an increase of 3%. This
increase would maintain the Federal Government's share of the excess costs of
educating handicapped children (compared» to nonhandicapped children)
approximately 8%. Overall reductions of 25% are sought for five of thei tcn
EHA discretionary yprograms, i.e., deaf-blind centers, early childhood
education, innovation and development, media and captioned films, and special
education personnel development. The other five discretionary programs would
be maintained at the FY83 funding level.

Authorization of appropriations expire Sept. 30, 1983 for all of the EHA
discretionary programs with the exception of the media services program which
has an indefinite authorization. For these discretionary programs to receive
funding in FY84, their authorization of appropriations would have to be
extended. This could be done either by legislative amendments to the EHA, or
by an automatic one-year extension of authorizations allowed for certain
education programs under the General Education Provisions Act, GEPA, Section
414 (a) 2 (B) .

LEGISLATION

N/A

HEARINGS

N/A

REPORTS AND CONGRESSIONAL DOCUMENTS

U.S. Congress. House. Committee on Education and Labor.
Education for All Handicapped Children Act of 1975;

report tO accompany H.R.
U.S. Govt.

session.

Congress.
handicapped children;
Nov.
(94th Congress,

14,

CRS-15 IB7804O UPDATE-O2/O9/83
7217.
Off., 1975.

Report no.

June 26, 1975.
67 p. (94th Congress,
94-332)

Washington,
Print. lst

House.

Conference Committee. Education of
conference report to accompany S. 6.

Washington, U.S. Govt. Print. Off., 1975.

1st session. Senate. Report no. 94-455)

Senate.

1975. 55 p.

OTHER CONGRESSIONAL ACTION

N/A

CHRONOLOGY OF EVENTS

11/04/82

08/04/82

08/10/82
08/04/82

05/23/82
06/22/82
06/10/82

03/31/82

02/08/82

Department of Education issued a modification of
notice of proposed rulemaking withdrawing certain
provisions in specified areas of the Aug. 4 Notice
of Proposed Rulemaking (NPRM); specifying current
regulatory provisions which would be restored in
these specified areas; extending the comment
period to Dec. 3, 1982; and announcing the
intention to publish a single revised NPRM for the
State grant program (P.L. 94-142) after a review
of the comments is made.

Department of Education issued notice of proposed
rulemaking for regulations pertaining to the Part B
program authorized under the Education of the
Handicapped Act.

Senate Subcommittee on the Handicapped held hearings
on proposed changes in Part B regulations.

ED issued notice of proposed rulemaking for
regulations governing the Part B program.

Conference report on the First Concurrent Resolution
on the Budget Fiscal year 1983, S.Con.Res. 92
(S.Rept. 97-478) agreed to in the Senate.

Conference report on the First Concurrent Resolution
on the Budget -- FY83, S.Con.Res. 92 (H.Rept. 97-614)
agreed to in the House.

First Concurrent Resolution on the Budget -- Fiscal
Year 1983, H.Con.Res. 352 passed the House amended
(Latta amendment).

Further Continuing Appropriations Resolution

for FY82 (H.J.Res. 409) signed into law, P.L. 97-161,
providing funding through Sept. 30, 1982 for EHA
programs as well as all other ED programs.

President Reagan submitted budget request for FY83
containing proposed reductions in FY82 and FY83 budget

CRS-16 IB7804O 'UPDATE-02/09/83

authority for EHA programs as well as a proposed
special education consolidation affecting all programs
currently authorized under EHA.

12/15/81 -- Further Continuing Appropriations Resolution for FY82
(H.J.Res. 370) signed into law, P.L. 97-92, providing
temporary funding through Mar. 31, 1982 for EHA programs
as well as all other ED programs.

08/13/81 -- Omnibus Budget Reconciliation Act of 1981 signed into
law, P.L. 97-35.

06/05/81 -- Supplemental Appropriations and Rescission Act, 1981,
signed into law, P.L. 97-12.

03/25/81 -- Reagan Administration announced review of Education
of the Handicapped regulations as part of the
Presidential Task Force on Regulatory Relief.

11/20/80 -- The House Subcommittee on Select Education held the
last of 7 days of oversight hearings in the 96th
Congress, 2d session, on the implementation
of P.L. 94-142. Other hearing dates were May 9,
June 6, 21 and 22, Sept. 22, and Nov. 19, 1980.

09/10/80 -- The Senate Subcommittee on the Handicapped held the
last of 5 days of oversight hearings on P.L. 94-142 .
in the 96th Congress, 2d session. Other hearing dates
were Mar. 3, July 29 and 31, and Aug. 20.

08/23/77 -- Final regulations issued for Part B, Education of the
3 Handicapped Act, as amended, State Assistance and

Incentive grants.

05/04/77 -- Final regulations issued for Sec. 504 of the Vocational
Rehabilitation Act - Nondiscrimination on the basis
of handicap.

11/29/75 -- S. 6, Education for All Handicapped Children Act of 1975,
signed into law as P.L. 94-142.

ADDITIONAL REFERENCE SOURCES

Education Advocates Coalition. Report by the Education Advocates
Coalition on Federal compliance activities to implement the
Education for All Handicapped Children Act (P.L. 94-142).
Washington, Apr. 16, 1980. 23 p. and appendices.

Education Turnkey Systems, Inc. P.L. 94-142: a study of the
implementation and impact at State level. Executive summary,
Falls Church, Virginia, 1981. 10 p.

Institute for Research on Educational Finance and Governance.
Estimating the cost of educating handicapped children:
a resource-cost model approach-summary report.
Meno Park, California, Stanford University, June, 1979. 29 p.

cns-17 IB78040 UPDATE-O2/09/83

National School Boards Association. A.survey of special
education costs in local school districts. Washington,
May 1979. 27 pages.

Rand Corporation. The cost of special education: summary of findings.
Santo Monica, California, November 1981. 56 p. -

Stanford Research Institute International. Local implementation
of P.L. 97-142: first year report of a longtitudinal study.
Meno Park, California. 1980. 139 p.

U.S. Department of Education. Second annual report to Congress on
the implementation of P.L- 94-142: The Education for all
Handicapped Children's Act. Washington, 1980. 219 p.

U.S. Department of Health, Education, and welfare. Office of
Education. Progress toward a free appropriate public
education; a report to Congress on the implementation of
Public Law 94-142: the Education for All Handicapped Children
Act. Washington, January 1979. 215 p. (LRS79-3638)

U.s. General Accounting Office. Disparities still exist in who
gets special education. Washington, 1981. 129 p.

----- Federal direction needed for .
educating handicapped children in state schools. Washington,
1978. 65 p. (LRS78-1825)

—-—-- Unanswered questions on educating handicapped children in local
public schools. Washington. 1981. 122 p.

U.S. Library of Congress. Congressional Research Service.
Analysis of the proposed regulatory changes to major
provisions of the Education of the Handicapped Act -— State
grant program [by] Angela Evans. Sept. 3, 1982;

—-—-- Analysis of the Department of Education's withdrawal of
sections of proposed regulations under P.L. 94-142, the
Education for All Handicapped Children Act [by] Angela
Evans and Nancy Lee Jones. Oct. 4, 1982.

—-—-- An analysis of the Federal policy of mainstreaming:
educating handicapped children with their nonhandicapped
peers [by] Angela Giordano Evans.. Apr. 24, 1979.

—-—-- Education for the handicapped: legislation enacted in
the 95th Congress [by] David Osman. Apr. 23, 1979.

----- Education of handicapped children in State operated or suported
schools: program summary and issue analysis [by] David Osman.
Nov. 3, 1980. 87 p.
CRS Report no. 80-193

—-—-- Funding and State plan approval process as practiced under
the Education of the Handicapped Act, Part B, State grant
program for FY 1978 through FY 1980 [by] Angela Giordano
Evans. Nov. 1, 1979.

- 
~

‘Feb.g23qil982.

CRS-18 IB7804O ‘UPDATE-O2/O9/83
~Impact of budget changes on major education programss, both enacted

andFproposed, during the 97th Congress [by]_Education staff.

Public Law 94-142 -4 Education for All Handicapped Children
Act of 1975: summary of provisions [by] David Osman.
Apr. 16, 1979.

UBRARY
OF
WASHINGTON
UNIVERSITY
ST. LOUHS — MCI-