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Apparently, North Carolina has decided that only 12.75 percent of its students are allowed to have disabilities.

Each year, the state allocates funds to school districts to offset the additional cost of appropriately educating students with disabilities. This support is crucial to ensuring that students with disabilities are able to succeed in school, graduate, and grow up to be employed, contributing members of our communities. We all have an interest in these kids doing well.

However, supports like these only work if students can access them. North Carolina allocates those education funds to school districts on a “per student” basis. Generally, that means school districts get a certain amount of those funds for each student that has been identified as having a disability. However, the state also has chosen to limit its “per student” allocations to 12.75 percent of each school district’s student population.

If more than 12.75 percent of the students in a school district have disabilities, the district gets no extra state funds to educate those students. They have to either use their already limited pool of funds to serve more and more students with disabilities, or they must dip into local county education funds to do so — usually an unpopular option because it can be viewed as taking money away from needed programs for students without disabilities. This is North Carolina’s artificial “IEP cap.”

The “IEP cap” disincentivizes school districts from identifying “too many” students with disabilities. It pits their federal Child Find obligations to identify all students with disabilities against their other federal IDEA obligations to appropriately educate students who have been identified. Without adequate funds from the state, North Carolina’s school districts are forced into a Sophie’s choice of resource allocation: do they adequately educate currently-identified students, or do they adequately identify all students with disabilities and run the risk of not having enough resources to appropriately educate any of them? This struggle harms students with disabilities and does nothing but distract from our schools’ fundamental mission to educate our children.

There are broader hidden costs to North Carolina’s “IEP cap” as well. It is no secret that students with disabilities have lower performance and are more likely to act out when they are not adequately identified and supported through an Individualized Education Program (IEP). Our state’s choice to create a system where students with disabilities are less likely to be identified means that more of our students will have those concerning behaviors in the classroom.

Beyond the strain this puts on students, their families, and school personnel, it also unnecessarily burdens our criminal justice system. Notably, almost half of the young people referred into North Carolina’s criminal justice system are referred through our schools — and mostly for things like acting out. The vast majority of the kids who are referred have disabilities. Given that our General Assembly just passed legislation aimed at cutting down on school-based referrals, shouldn’t we be investing in the supports necessary to help students with disabilities succeed in the classroom and stay out of the courts?

Our current approach also puts students with disabilities who are in smaller, rural school districts at a particular disadvantage. Student enrollment is dropping in rural parts of the state. Because the families of students with disabilities tend to be less economically mobile than the families of their peers, they are more likely to be the ones who remain in these school districts after others have left.

Over time, ongoing shifts in student populations will continue to inflate the “percentage” of students with disabilities in rural school districts, even if the actual number of those students does not appreciably change. With dwindling enrollments, and therefore an ever-shrinking pool of general education state funds to draw from, how are these rural school districts supposed to survive? What will happen to their students? Our state does not seem to have an answer for them.

While the state is experimenting with a limited voucher system for students with disabilities, those programs can cost North Carolina taxpayers twice as much as educating children with disabilities in public school and, therefore, are unlikely to provide a global, fiscally-responsible solution to this issue. They also do not guarantee the existence of local private schools for rural students with disabilities. It is an issue too big to fully cover here.

Bottom line, our current approach does not work. There is no magic percentage of student population that could be applied to fix it. The state’s artificial “IEP cap” is a policy weighed down by unintended consequences and a fundamental misalignment with reality. Dictating how many students are “allowed” to have a disability is tantamount to a hospital deciding how many people are “allowed” to get sick.

We need to be smart about how we spend our education dollars in North Carolina. Disincentivizing schools from complying with federal law and properly identifying students with disabilities is an inefficient and costly policy choice. That makes the math pretty simple: We need to blow the lid off North Carolina’s “IEP cap.”

Matthew Herr

Matthew Herr is an attorney and works with Disability Rights North Carolina as a policy analyst.