Impact Aid: How Districts Qualify and Apply for Funding

By Billie Jordan, OASIS Executive Director and Steven Crawford, OASIS Associate Director

The Impact Aid Program, funded through the U.S. Department of Education, is designed to reimburse districts for the financial burden caused by the acquisition of property by the Federal government. Since the program is only partially funded, on average districts receive about 40% of what they would be allocated if the property remained on the tax rolls. There is currently legislation to fully fund the program, which would provide an additional $40 million to Oklahoma schools.

There are two main categories of funding.

Section 7002:

Payments to reimburse school districts that have significant amounts of federal land within their boundaries, such as military installations, Veterans Administration hospitals, Corp of Engineers property or national parks. In FY20, 33 Oklahoma districts received a total of $1,798,121.

Section 7003:

Payments to reimburse districts who identify students who (a) reside on Federal property including government low-rent housing (b) have a parent on active military duty, (c) have a parent who works on Federal property, or (d) reside on Indian lands. Additional funding is provided for those eligible students on an IEP.

In Oklahoma, 202 districts received approximately $32 million in Section 7003 funding in FY20, more districts than any other state.

Districts receiving Impact Aid funds must apply before January 30 each year. The application is web based through the IAGS system. Superintendents register as the core user, then may assign other users to work on the application. Each district is assigned a “Program Analyst” with the USDE Office of Impact Aid to assist them with the application process and to answer questions if needed.

While 7002 applications are very simple since the number of Federal acres in a district change very little, the 7003 application requires yearly verification that students qualify.

Most districts use Impact Aid Student Surveys to count eligible students. The date of the survey must be at least 3 days after school starts, but before January 31. Program Analysts will provide sample surveys if requested.

Districts use a variety of methods to ensure that every student returns a survey, counts the students in each category, inputs the data into the IAGS system, uploads required documentation, and submits the application. Districts have until June 30 to amend their application, and when they undergo a “field review,” may be asked for the actual survey forms or other documentation. It is important that all records are kept for 3 years.

Federally Connected Students Have a Weighted Formula.

The formula to calculate a school district’s payment recognizes there is varying tax loss associated with where federally connected students live and assigns different weights for different categories of students:

Type of Federally Impacted Student and Weights Calculated in Impact Aid Allocations

Student living on Indian Trust, Treaty, or ANSCA Land = 1.25

Active Military Living On Base = 1.0

Active Military Living Off Base = .20

Student living in Low-rent Government Housing = .10

Civilian whose parent both lives AND works on Federal Property = 1.0

Civilian whose parent either works OR lives on Federal Property* = .05

*These students can only be calculated into a school district’s payment if there are 1,000 in ADA or they represent at least 10 percent of the school district’s ADA.

The Oklahoma Association Serving Impacted Schools, OASIS, provides technical assistance to districts, helping them navigate the application process. The OASIS state conference, November 9-10 at River Spirit Tulsa, starts with a morning of very basic training to help district personnel understand the process and to provide them examples and other information to assist them in applying. For questions about Impact Aid, superintendents can contact OASIS Executive Director Billie Jordan or Associate Director, Steven Crawford. Contact information and other resources are available at oasisok.com.

Section 7003 FY 2022 Funding:

$1,557,112,000

■ 847,630 Federally Connected Children

■ 1,100+ Districts Enrolling Over 10 Million Students

https://www.nafisdc.org/wp-content/uploads/2022/08/The-Basics_Fall-2022-FINAL-1.pdf