The Texas Education Agency (TEA) has issued correspondence regarding the repeal of 55% spending requirement for the Compensatory Education Allotment (Comp Ed) through the implementation of House Bill 2 (89-R). HB 2 repealed the statutory requirement mandating that school systems spend 55% of Comp Ed allotment funds only on direct instructional services for students identified as at-risk and/or economically disadvantaged, effective with the 2025–2026 fiscal year.
School systems are no longer bound by a fixed spending threshold and may implement strategies tailored to their unique student populations. The repeal eliminates the requirement to complete Schedule J-4 of the annual financial and compliance report (AFR) and submit campus improvement plans for Comp Ed purposes via TEA Login (TEAL). Of note, the Comp Ed funding formula remains unchanged, ensuring continued support for students identified as at-risk (TEC §48.104).
Program Intent Codes (PIC) 24, 26, 28, 29, and 30 will remain available for use in the Financial Accountability System Resource Guide (FASRG) during fiscal years 2024–2025 and 2025–2026. Beginning in fiscal year 2026–2027:
- PIC 26, 28, 29, and 30 will be removed from the FASRG.
- School systems are strongly encouraged to continue using PIC 24 internally for budgeting and tracking to maintain clarity and consistency in local documentation and reporting; however, the agency will consolidate the PIC 24 reported expenditures into PIC 11 for state reporting purposes and Public Education Information Management System (PEIMS) financial reports.
In accordance with TEC, §29.081, school systems must implement targeted instructional strategies, including:
- Identification of students at risk of dropping out.
- Provision of compensatory, intensive, or accelerated instructional support.
- Delivery of accelerated instruction for students who fail end-of-course exams.
- Adequate budgeting and annual program evaluations, including public hearings.
The full correspondence from TEA can be found here. More information can be found here.
