Frequently Asked ARP-HCY Questions and Answers

This page contains responses to common ARP-HCY questions. This page will be updated periodically as the Department fields additional questions about the implementation of the ARP-HCY program. (The dates in parenthesis after each question indicates the date that the question and corresponding response were added to this webpage.) If you have a question about the ARP-HCY program, please contact the Department’s program team at HomelessED@ed.gov.

Questions about the ARP-HCY program

How does an SEA or LEA determine whether a proposed use of ARP-HCY funds is allowable? (Date published: August 2023)

The purpose of the ARP-HCY program is to identify homeless children and youth and provide these children and youth with wrap-around services in light of the challenges of COVID-19 and assistance needed to enable homeless children and youth to attend school and participate fully in school activities. Secretary Cardona’s April 2021 Letter to Chief State School Officers listed examples of potentially allowable expenses, but this list is not exhaustive, nor should it be taken to mean that every item on the list is allowable under every circumstance. Furthermore, an SEA or LEA may be more restrictive than what is permitted by statute in its specific determinations of allowability as its decisions are also guided by grant program needs assessments, program goals and evaluation, and efforts to mitigate fraud, waste, and abuse.

In addition to the Secretary’s letter, our webinar slides from June 2021 and February 2022 provide many examples of allowable uses of funds. To determine whether a proposed use of ARP-HCY funding is allowable, please consult the Use of Funds Tip Sheet issued by our National Center for Homeless Education. That tip sheet discusses six decision points for both ARP-HCY and McKinney-Vento subgrant uses of funds.

Can an SEA amend its approved ARP-HCY State plan? (Date published: April 2022)

Yes. To request an amendment to an ARP-HCY State plan, an SEA must submit to the Department a redlined version of the State’s approved plan that reflects the SEA’s proposed amendment. SEAs should submit amendment requests and related materials to the HomelessEd@ed.gov mailbox. The Department will review the State’s amendment request and may provide feedback requiring further revisions. Once the Department approves the amended plan, the Department will notify the Chief State School Officer and request that the State submit a 508-compliant pdf version of the revised plan for the Department to post on the ARP-HCY State plans webpage.

Can an SEA subgrant its ARP-HCY funds to LEAs before the U.S. Department of Education approves the State’s ARP-HCY State plan? (Date published: October 2021)

Yes. Each SEA is permitted and encouraged to subgrant ARP Homeless I and ARP Homeless II funds to LEAs prior to the U.S. Department of Education’s approval of ARP-HCY State plans. SEAs should make these funds available to LEAs as quickly as possible to ensure that the funds may be used to provide services to children and youth experiencing homelessness during the 2021-2022 school year. If SEAs have any questions about the awarding of subgrant funds to LEAs, they should contact Department staff.

Is the ARP-HCY program subject to a restricted indirect cost rate or an unrestricted indirect cost rate? (Date published: September 2021)

The ARP-HCY program does not have a “supplement not supplant” requirement and therefore is subject to an unrestricted indirect cost rate. (See 34 C.F.R. § 75.563.)

Can ARP-HCY funds be used for pre-award costs? (Date published: September 2021)

The Uniform Guidance at 2 C.F.R. § 200.458 defines pre-award costs as follows:

Pre-award costs are those incurred prior to the effective date of the Federal award or subaward directly pursuant to the negotiation and in anticipation of the Federal award where such costs are necessary for efficient and timely performance of the scope of work. Such costs are allowable only to the extent that they would have been allowable if incurred after the date of the Federal award and only with the written approval of the Federal awarding agency. If charged to the award, these costs must be charged to the initial budget period of the award, unless otherwise specified by the Federal awarding agency or pass-through entity.

As one of the purposes of the ARP-HCY program is to provide wrap-around services in light of the challenges of COVID-19, ARP-HCY funds may be used for pre-award costs dating back to March 13, 2020, when the national emergency was declared.

Questions about ARP Homeless II subgrants to LEAs

When LEAs form a consortium, do students in each participating LEA have to be served in proportion to the LEA’s initial allocation? (Date published: January 2022)

No. When LEAs form a consortium, the funds generated by each LEA are pooled, and students in each of the consortium’s LEAs do not have to be served in proportion to the LEA’s initial allocation. Instead, the consortium can serve students experiencing homelessness based on the total grant amount available to the consortium and what is deemed reasonable and necessary (pursuant to 2 CFR 200.404) to support these students’ full participation in school activities.

Must LEAs affirmatively decline ARP Homeless II subgrants before an SEA runs the ARP Homeless II subgrant formula (as required in the final requirements) and disburses subgrants to LEAs? (Date published: January 2022)

There is no Federal requirement that would require an SEA to receive affirmative denials of subgrants before distributing ARP Homeless II subgrants to its LEAs. An SEA could set reasonable deadlines for each of its LEAs to indicate an intent to apply for ARP Homeless II funds and make clear that an LEA will be considered to have declined the funds if the LEA does not respond by the deadline. The Department recommends, however, that an SEA contact its LEAs that have not indicated an intent to apply for ARP Homeless II subgrants by the requested deadline. The Department also recommends that an SEA maintain thorough documentation of communications with LEAs about the ARP Homeless II subgrants. Finally, while there are no Federal requirements that would require LEAs to affirmatively decline ARP Homeless II subgrant funds, there may be State or local requirements that SEAs and LEAs should consider.

May an SEA limit the period of availability for ARP Homeless II funds subgranted to an LEA? (Date published: November 2021)

No. In contrast to the Education for Homeless Children and Youth program under the McKinney-Vento Act and the ARP Homeless I funds, the ARP Homeless II program uses a formula to award subgrants to LEAs with the State educational agency (SEA) acting as a pass-through entity to award subgrants. As a result, the LEA’s period of availability for the ARP Homeless II funds must be the full period of funding availability (i.e., until September 30, 2024). To ensure that an LEA is carrying out its ARP Homeless II subgrant consistent with its approved application, however, an SEA may set reasonable deadlines for an LEA to demonstrate that it is obligating and drawing down funds over the course of the full period of availability, so as to encourage the timely use of funds and so that the SEA does not end up returning funds to the U.S. Treasury. The SEA cannot, however, establish a shorter period of availability for LEAs.

To ensure an LEA uses the funds to support homeless children and youth during the period of availability, as noted above, the Department encourages SEAs to continue to provide technical assistance and support to LEAs and to periodically review available balances to ensure the timely use of funds to meet local needs.

What flexibility does an SEA have with any ARP Homeless II funds that an LEA declines? (Date published: November 2021)

The extent of flexibility depends on whether an SEA has reserved the full 25 percent for State activities. If an LEA declines some or all of its ARP Homeless II funds, and the addition of this amount to the SEA’s State activities reservation still results in a reservation percentage that does not exceed 25 percent, the SEA may add the declined funds to its State activities reservation or may reallocate those funds to other LEAs consistent with the required ARP Homeless II formula. Conversely, if adding the declined funds to the SEA’s reservation would result in a reservation percentage that exceeds 25 percent, then the SEA must reallocate the funds to other LEAs consistent with the required formula.

How should an SEA calculate ARP Homeless II subgrants to LEAs that did not receive a Title I, Part A allocation in fiscal year 2020? (Date published: September 2021)

The Department published a Notice of Final Requirements (NFR) on July 9, 2021, governing how an SEA must award ARP Homeless II subgrants to LEAs. As described in the NFR, an SEA must award ARP Homeless II subgrants to each LEA according to the following formula:

50 percent in proportion to the amount that each LEA received under Title I, Part A for the most recent fiscal year (i.e., fiscal year 2020), and
50 percent in proportion to the number of homeless children and youth identified by each LEA relative to all LEAs in the State, using the greater of the number of homeless children and youth in either the 2019-2019 or 2019-2020 school year in each LEA.

To calculate the first part of the formula, an SEA must consider the proportion of the State’s fiscal year 2020 Title I, Part A allocation that each LEA received. For an LEA that did not receive fiscal year 2020 Title I, Part A funds (either because it was not eligible under any of the Title I, Part A formulas or because it declined its Title I, Part A allocation), an SEA must input $0 for the first part of the funding formula. An LEA that did not receive a fiscal year 2020 Title I, Part A allocation may still receive an ARP Homeless II allocation under the second part of the formula based on the number of homeless children and youth identified by the LEA.

Can an SEA use school year 2020-2021 data in calculating the 50% of the LEA subgrant based on an LEA’s homeless count under the ARP Homeless II formula? (Date published: September 2021)

No. States cannot use school year 2020-2021 data in calculating the homeless student count for the ARP Homeless II formula. The Department published a Notice of Final Requirements (NFR) on July 9, 2021, governing how an SEA must award ARP Homeless II subgrants to LEAs. As described in the NFR, an SEA must use homeless student counts from school years 2018-2019 or 2019-2020, whichever is greater, for each LEA in calculating ARP Homeless II subgrants.

Is an SEA required to permit LEAs to form consortia for the purposes of receiving ARP Homeless II subgrants? (Date published: September 2021)

Yes. If a consortium of LEAs with a combined allocation of at least $5,000 requests a subgrant, the SEA does not have authority to deny this request. The Notice of Final Requirements (NFR) issued on July 9, 2021, emphasizes the importance of serving homeless students in communities that have not historically participated in the Education for Homeless Children and Youth (EHCY) program (i.e., LEAs that do not typically receive EHCY subgrants). The NFR also indicates that a purpose of the ARP Homeless II formula is to ensure that the vast majority of LEAs will be able to receive ARP Homeless II subgrants. To ensure that as many LEAs as possible can receive subgrants, an SEA should encourage and support the formation of consortia by those LEAs whose individual formula allocations would otherwise be under $5,000 and who would therefore be ineligible for an ARP Homeless II subgrant.

Questions about ARP Homeless II funds announced to State educational agencies on July 6, 2021

What is the timeline for obligating ARP Homeless II funds? (Date published: July 2021)

Funds appropriated under section 2001 of the ARP are available through September 30, 2023. Under section 421(b) of the General Education Provisions Act, funds not obligated and expended prior to the beginning of the fiscal year following the fiscal year for which funds were appropriated remain available for obligation and expenditure for an additional year. Accordingly, funds appropriated under the ARP-HCY program will be available until September 30, 2024. The deadline for drawdown of obligated funds is 120 days later, or January 30, 2025 (see 2 C.F.R. § 200.344(b)). This applies to both awards of funds under the ARP-HCY program (i.e., ARP Homeless I, awarded in April 2021, and ARP Homeless II, awarded in July 2021).

What is the deadline for submitting an application for ARP Homeless II funds? What is the process for submitting an ARP Homeless II Application? (Date published: July 2021)

To receive ARP Homeless II funds, each SEA must submit a signed PDF of the ARP Homeless II Application by July 20, 2021. ARP Homeless II Applications should be submitted to the U.S. Department of Education via HomelessED@ed.gov. The document entitled “Application for Funding Under the ARP-HCY: Second Disbursement” (available at https://oese.ed.gov/offices/american-rescue-plan/american-rescue-plan-elementary-secondary-school-emergency-relief-homeless-children-youth-arp-hcy/) identifies the required elements of ARP Homeless II Applications (on page 5).

What is the deadline for submitting an ARP-HCY State Plan? What is the process for submitting an ARP-HCY State Plan? (Date published: July 2021)

Each SEA receiving ARP-HCY funds must submit an ARP-HCY State Plan by September 7, 2021. ARP-HCY State Plans should be submitted to the U.S. Department of Education via HomelessED@ed.gov. The document entitled “Application for Funding Under the ARP-HCY: Second Disbursement” (available at https://oese.ed.gov/offices/american-rescue-plan/american-rescue-plan-elementary-secondary-school-emergency-relief-homeless-children-youth-arp-hcy/) identifies the required elements of ARP-HCY State Plans (on pages 7-8).

Questions About ARP Homeless I funds awarded to State educational agencies on April 26, 2021

Which provisions of the Education for Homeless Children and Youths (EHCY) program apply to the ARP Homeless I funds disbursed on April 26, 2021?

(Date published: May 2021)

The ARP Homeless I funds were released as a supplement to States’ EHCY grants. Accordingly, all of the provisions of the EHCY statute (Title VII-B of the McKinney-Vento Homeless Assistance Act) apply to the ARP Homeless I funds.

Does the ARP’s maintenance of effort requirement in section 2004(a) apply to the ARP Homeless I funds?

(Date published: May 2021)

Yes. A Maintenance of Effort update is available at https://oese.ed.gov/files/2021/04/MOE-Chart_with-waiver-FAQs_FINAL_4.21.21Update.pdf.

What provisions of the ARP do not apply to ARP-HCY?

(Date published: May 2021)

The requirements in section 2001(c)-(i) do not apply to ARP-HCY funds. For example, while section 2001(d)(2) of the ARP requires SEAs receiving grants under the Elementary and Secondary School Emergency Relief (ARP ESSER) fund to award funds to LEAs within 60 days, this requirement does not apply to ARP-HCY funding.

In addition, ARP ESSER grantees are required to submit a State plan by June 7, 2021. While the SEA is required to include in its plan a description of how students experiencing homelessness will be served through the ARP ESSER program, it is focused on the ARP ESSER funds, not the ARP-HCY program. More information will be forthcoming about the State plan process for ARP-HCY.

What is the timeline for obligating and drawing down ARP Homeless I funds?

(Date published: May 2021)

May SEAs reserve costs for direct administrative expenses for the ARP Homeless I funding?

(Date published: May 2021)

As mentioned in the Dear Colleague Letter on April 23, 2021, available at https://oese.ed.gov/files/2021/04/ARP-Homeless-DCL-4.23.pdf, an SEA may reserve up to 25% of its ARP Homeless I allocation for State-level activities, consistent with section 722(e)(2) of the McKinney-Vento Homeless Assistance Act (McKinney-Vento Act). The SEA may use part of that reservation for direct administrative costs that are not already included in the indirect cost rate it may charge for the program.

What must be included in an LEA subgrant application and competition for the ARP Homeless I funds?

(Date published: May 2021)

The subgrant application and award requirements in section 723(b)-(c) of the McKinney-Vento Act apply to any new subgrant application and competition for ARP Homeless I funding. The Department encourages SEAs to award ARP Homeless I subgrants to LEAs as soon as possible, but SEAs may award these funds to continuing EHCY subgrantees, hold a new competition, or supplement new EHCY awards made on or after July 1, 2021.