Sneak Preview: ED Halts ESF Obligation Liquidation Extensions
(The following was excerpted from a recent Thompson Grants Compliance Expert article.) The Department of Education (ED) on March 28 issued a letter to state education heads calling for an immediate halt to extensions of the obligation liquidation period for programs under the Education Stabilization Fund (ESF).
In response to the COVID-19 pandemic, the Coronavirus Aid, Relief, and Economic Security Act (CARES Act) (Pub. L. 116-136) made available $30 billion under ESF to support reopening K-12 schools, assist with continuity of learning and measure the educational decline caused by the lack of in-person learning opportunities. The Coronavirus Response and Relief Supplemental Appropriations Act (CRRSA) (Pub. L. 116-260) made another $81.9 billion in relief assistance available through ESF, while the American Rescue Plan (ARP) provided a third round of relief funding. The ESF includes programs such as the Elementary and Secondary School Emergency Relief Fund and the Higher Education Emergency Relief Fund. CRRSA dollars were available for obligation through Sept. 30, 2023, while ARP required recipients to obligate the final round of remaining funds by Sept. 30, 2024, although previous ED guidance enabled recipients to request extensions.
The ED letter to states cites the uniform guidance provision at §200.344(c), which requires a federal award recipient to liquidate all obligations no later than 120 calendar days after the conclusion of the award. It adds that a federal agency may approve extensions if the agency, in its discretion, finds that such an extension is justified. ED now is stressing that the period to liquidate obligations for extensions has now expired, and that the department is telling these states that had extensions that it “has reconsidered your request” for the previously granted liquidation period extension.
“After careful review, [ED] is modifying the liquidation period [for all ESF programs funded under CRRSA and ARP] to end on March 28, 2025” at 5 p.m. Eastern time, the letter explains, adding that “the further extension of the liquidation period for the aforementioned grants, already well past the period of performance, was not justified. You and your subrecipients have had ample time to liquidate obligations. … By failing to meet the clear deadline in the regulation, you ran the risk that the department would deny your extension request.”
(The full version of this story has now been made available to all for a limited time here.)
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