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Far From Home: Who Pays The Price For Out-Of-State Placements?

QuoteInspector via Flickr CC BY ND 2

Every child in America has the right to a “free and appropriate public education,” thanks to the Individuals with Disabilities Education Act, signed into law by President George H.W. Bush almost three decades ago.

And if that education can’t be provided in the student’s home district, the student can go elsewhere —  also for free. Illinois taxpayers typically spend at least $25 million per year to place hundreds of students outside the state, in residential treatment centers, therapeutic boarding schools, and other private facilities designed to serve students with special needs. 

Here’s how that works: If a local school district doesn’t offer the services a student with a disability needs, the district is required to help fund that student’s tuition at another facility. The amount the district contributes depends on two factors: 1) the normal cost of educating a student in the home district and 2) whether the student is placed at a public facility (such as a special education co-op) or a private facility.

That first factor is known as the district’s “per cap,” and it’s a complicated calculation dividing the difference between certain district expenses and revenues by average daily attendance. That dollar amount, unique to each of Illinois’ 852 districts, ranges from a low of $5,000 to more than $29,000. If a student it placed at a private facility — whether in Illinois or elsewhere — the district is obligated to contribute an amount equal to two times per cap, and the Illinois State Board of Education (ISBE) reimburses most of the remainder of the tuition. If a student is placed at a public facility, the district is obligated to contribute four times per cap, but the reimbursement rate is pennies on the dollar. 

Because the cost to the home school district is so much higher for public instead of private placement, many special education advocates argue that Illinois’ funding structure leaves public facilities starved for resources while incentivizing placement in private facilities. Melissa Taylor, past-president of the Illinois Alliance of Administrators of Special Education (IAASE), surveyed other states and concluded that Illinois is unique in this funding structure.

“Illinois is the only state in the nation that funds private special education placements and public special education placements differently,” she says. 

For more than a decade, IAASE has been pushing lawmakers to equalize the reimbursement formula, but private school advocates have effectively lobbied against it, and despite sponsorship by Democrats in a Democrat-controlled legislature, the proposal has never gotten out of committee.

It’s hard to see how that will change anytime soon, since some of those public co-operative programs were revealed to rely on seclusion rooms in the recent investigation published by the Chicago Tribune and ProPublica. However, that investigation was made possible because the public facilities are required to document seclusion. New rules enacted by ISBE in the wake of that investigation will require private facilities to document seclusion, but they had not been required to do so until now. 

ISBE also tried to restrict the use of restraints in those new rules, but backlash forced the board to roll back that restriction. Much of that pressure came from private facilities in other states, who notified families and ISBE that Illinois students would be disenrolled if the schools could not use restraints.

Decisions about where to place a student with special needs typically — but not always — begin in their home district when the student’s parents meet with the special education team to craft the student’s Individualized Education Plan, known as an IEP. It’s in these meetings, which happen every three years (or more often if needed), that the idea of placing a student in a residential program would be discussed.

Stephanie Jones, an education attorney and former general counsel for ISBE, says residential placement is sometimes proposed by the teachers, social worker, school psychologist, and others on the IEP team.

Credit Kriha Boucek law firm
Stephanie Jones

“There are kids that have very significant mental health disabilities or even kids that are on the autism spectrum as they get older that can't be controlled in a school setting that need a much more therapeutic setting with people that are trained to handle a lot of violent outbursts,” she says. “So I'm aware of kids that have, you know, broken plate glass windows and things like that. And that's where I've seen school districts actually recommend a residential placement that has round-the-clock mental health.”

Other times, she says, that request comes from the family.


“I see the cases where parents just can't handle the kids at home anymore,” Jones says. “The kids are either physically aggressive or behaviorally just cannot be managed in the home environment. And those are a lot of the types of cases where I see parents coming to school districts asking for residential placements.”

Jennifer Smith, a partner in a law firm that represents more than 100 Illinois school districts, says sometimes, a residential placement happens even before the student has an IEP. 

Credit Franczek P.C.
Jennifer Smith

“Under federal law, parents have the right to send their child to a private school that they pay for upfront and then seek reimbursement from the school district, if they believe the school has not offered their child an education that satisfies a number of complicated legal requirements,” she says. “Then after they've made the placement, they ask the district to evaluate the student for an IEP and fund that placement that's already been made.”

This process, known as unilateral placement, is obviously available mainly to families who have substantial financial and legal resources, and often bring attorneys with them to the IEP meetings. If the district refuses to create or amend the student’s IEP, the family can pursue due process, going before an ISBE hearing officer. If the officer rules in the family’s favor, the district is on the hook for not only a chunk of the student’s tuition, but also legal fees — its own as well as the family’s. 

Because of that substantial monetary risk, some districts choose to settle the dispute by authorizing a temporary one-year placement.

Jones says some districts offer to just pay the family the amount the district would owe if it had placed the child (two times per cap). Such settlements are not reported to ISBE and aren’t reflected in funding figures NPR Illinois obtained for this story.

Residential placements, though, come with another type of risk — risk to the safety and well-being of the child. At least one central Illinois student was withdrawn from a residential facility, Great Circle in St. Louis, after suffering physical abuse. In the 2017-18 school year, Illinois had 52 students at that same facility, according to data obtained through the Freedom of Information Act.

That same year, 55 Illinois students were placed in various private schools in Oconomowoc, Wisconsin. A suburban mom, who uses the pen name Sarah Malloy, says she was shocked when she visited her autistic son in one of those . 

“I saw a member of the staff kicking a child who was on the floor, crying for their mother,” she says. “They had wet their pants, and the guy who was in charge of the building kept saying, like, ‘Hey! Hey! You want to see your mom? You're gonna cut it out right now!’ ”

Malloy says she alerted administrators, and got no response. She ultimately withdrew her son from that school.

“If [that staff member] did that on the street, he would be arrested,” she says. “If he's doing it to one he's doing it to others.”

That Wisconsin school is on a list approved by both the state of Illinois and the federal government. Tomorrow, we look at residential facilities in a state known for having loose laws and little oversight.

After a long career in newspapers (Dallas Observer, The Dallas Morning News, Anchorage Daily News, Illinois Times), Dusty returned to school to get a master's degree in multimedia journalism. She began work as Education Desk reporter at NPR Illinois in September 2014.
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