Maximizing ESSA’s 7-Percent Set-Aside for School Improvement CST

By Carlas McCauley / July 21, 2016

Photo of the Capitol building


On December 10, 2015, President Obama signed into law the Every Student Succeeds Act (ESSA), which reauthorizes the Elementary and Secondary Education Act and replaces the No Child Left Behind Act (NCLB). The new law includes major revisions to the previous law in terms of how states design their accountability systems and provide supports to improve academic outcomes in their lowest-performing schools.

The law calls for states, beginning in school year 2017/18, to use accountability indicators, disaggregated by subgroup, to annually differentiate public schools by several categories. One category covers Title I schools with at least one consistently underperforming subgroup of students. These schools, identified for targeted support and improvement (TSI), must develop and implement their own intervention plan that focuses improvement efforts on the particular subgroup(s) that caused it to be identified for TSI. The TSI plan must be approved and monitored by its district.

States must also identify at least 5 percent of their Title I schools for comprehensive support and improvement (CSI). This category, which is for schools considered to be in greater trouble academically than TSI schools, includes

  • schools in the lowest-performing 5 percent (or more, at the state’s discretion) of all Title I schools in a state;
  • high schools failing to graduate at least two thirds of their students (i.e., having a graduation rate of 67 percent or lower); and
  • Title I schools with at least one consistently underperforming subgroup that, on its own, has been performing as poorly as students in the lowest-performing 5 percent of all Title I schools in the state for a number of years (to be determined by each state) and that has failed to improve after the school has implemented an improvement plan, whether that plan is a standard Title I improvement plan in the initial ESSA years or a TSI plan once ESSA has been fully implemented.

Whereas TSI school improvement efforts are overseen by the district, each CSI school must implement a school-specific comprehensive intervention plan that is developed by its district but is approved, monitored, and regularly reviewed by its state education agency (SEA).

A district’s individualized comprehensive support and improvement plan for any of its CSI schools must address performance on all indicators in the statewide accountability system, including student performance against the state’s long-term goals. The plan, which the school (along with the district and SEA) needs to approve, must

  • be based on a school-level needs assessment;
  • consist of evidence-based interventions; and
  • identify resource inequities that will be addressed through implementation of the plan.

The ESSA legislation itself calls for states to begin identifying both TSI and CSI schools in 2017/18, but under the U.S. Department of Education’s proposed regulations, states would not need to begin identifying TSI schools until 2018/19. However, reflecting a concern that CSI schools need immediate action, these proposed regulations would have states start identifying CSI schools a year earlier, in 2017/18, and then, as the legislation requires, at least every three years thereafter. For the first year of identification, states would use data from 2016/17. The department is currently taking feedback from the field on this and other issues and is likely to release final regulations in October or November of this year.

Under the ESSA legislation, states must also develop improvement criteria that would allow CSI-identified schools to be removed from the CSI category. If, after a state-determined period of time (no longer than four years), a CSI school has not met that exit criteria, the state is required to take more-rigorous action.

The Set-Aside

ESSA eliminated the stand-alone School Improvement Grant (SIG) and replaced it with a required 7-percent state-level set-aside of Title I funds for school improvement. This set-aside, as designated in ESSA Section 1003, must be used to support districts with CSI and TSI schools. At least 95 percent of these school-improvement funds must go to local school districts, education service agencies, or consortia of districts, by formula or competition. Like SIG, the set-aside may be used to conduct a grant competition and permits an award for up to four years, which may include a planning year. States must give priority to school districts that

  • serve high numbers or percentages of elementary and secondary schools identified for comprehensive or targeted support;
  • demonstrate the greatest need, as determined by the state; and
  • demonstrate the strongest commitment to using the funds to improve student achievement and outcomes.

Possible Challenges

Several issues will likely be challenging for states as they implement the set-aside.

Local funding assurance: The statute requires districts to ensure that they will provide, to each school served under ESSA Section 1003, all of the state and local funds that the school would receive regardless of whether it is receiving Section 1003 services. Compliance with this requirement could be affected by any “supplement, not supplant” regulation released by the department under Title I, Part A.

“Hold harmless” provision: As was true under NCLB, a “hold harmless” provision that prohibits states from reserving the full 7 percent if doing so would decrease a local education agency (LEA)’s Title I, Part A, allocation to below what it received in the previous year is included in ESSA Section 1003. Importantly, this provision does not take effect until 2018/19, meaning that LEAs’ Title I, Part A, allocations could be reduced when states take the 7-percent set-aside in 2017/18. This could result in a loss of funding for some districts.

Decreased “regular” Title I funds: As noted above, because the “hold harmless” provision does not take effect until 2018/19, some districts will likely receive less Title I funding in 2017/18 than in previous years. A decreased Title I allocation is challenging for a district because it can result in fewer district schools receiving funds under Title I. Under Title I school allocation rules, many schools with high numbers of low-income children do not receive support from Title I because they are surrounded by other schools that are even poorer, so the Title I money “runs out” before those schools have the opportunity to receive funds. In practice, this means that many high-poverty schools do not receive Title I funds, particularly at the high school level. Therefore, states must be prepared to help districts that are facing the challenge of decreased regular Title I funding as a result of the 7-percent set-aside requirement.

Evidence-Based Interventions: ESSA includes a new evidence-based requirement and defines four levels of evidence:

  • Strong — at least one well-designed and well-implemented experimental study (i.e., a randomized controlled trial).
  • Moderate — at least one well-designed and well-implemented quasi-experimental study.
  • Promising — at least one well-designed and well-implemented correlation study with statistical controls for selection bias.
  • Research-based rationale — high-quality research findings or evaluations that show the intervention is likely to improve outcomes, and that include ongoing efforts to examine effects of the activity, strategy, or intervention.

While some ESSA programs allow the use of all four levels of evidence, Section 1003 requires that CSI and TSI schools use these funds only for interventions reflecting one of the highest three levels of evidence (Strong, Moderate, and/or Promising). Given the possible dearth of interventions that meet one of these evidence levels, how states and districts will be able to meet the evidence-based requirement is a concern.


As states and districts prepare to meet these possible challenges, they have the opportunity to strengthen collaborative relationships, troubleshoot different types of problems, and develop or change policies and practices to meet the new demands of ESSA and the needs of low-performing school communities. For example, SEA and/or LEA leadership could:

  • Address the issue of potential reductions in regular Title I, Part A grants. Because Section 1003’s “hold harmless” provision does not take effect until 2018/19, states should begin thinking about how to support districts whose Title I, Part A, allocations will decrease in 2017/18, when the state takes its 7 percent set-aside. Depending on the district, this reduction could have a significant impact during the initial year of ESSA implementation.
    • Expand support for school improvement efforts to include the use of regular Title I funds and other ESSA funding sources in addition to Section 1003 school improvement funds. In order to “unlock” regular Title I funds and other ESSA funds — which are important resources in many low-performing schools — past policies and practices on the use of these funds need to be examined, with some changes likely needed. Making these changes may be challenging but doing so is critical to effectively supporting school improvement efforts. Two guides that can help in this effort are WestEd’s Using Federal Education Formula Funds for School Turnaround (this publication primarily describes NCLB funding, but also explains state levers for maximizing effective use of federal funds in low-performing schools) and CCSSO’s Maximizing ESSA Formula Funds for Students: State Readiness Self-Assessment (which provides SEA diagnostics to use in assessing current practices and changing them where necessary).
  • Assess the state’s and the district’s ability to implement evidence-based practices. States must understand what types of interventions meet ESSA’s evidence standards and must assist districts in understanding how to identify, select, and support evidence-based strategies. Within SEAs, this should be a cross-office effort because staff expertise in evidence likely varies by office, depending on the subject matter or intervention in question. An “all hands on deck” approach is important if SEAs do not want a few individuals’ interpretations of the new evidence-based requirements to artificially limit effective uses of federal funds.
  • Establish and articulate clear, shared criteria and definitions for successful turnaround. When expectations are clear, districts and schools are able to spend less time guessing what the SEA or LEA wants and more time on improving quality, implementing promising practices, and improving short-term and long-term outcomes for students.


ESSA creates a major policy shift in the world of school improvement and school turnaround. While the changes required by this shift can be challenging, they also create the opportunity for educators to make dramatic, lasting improvements in the lives of the millions of students who attend persistently low-achieving schools. ESSA provides states with the flexibility to reimagine how supports to low-performing schools, whether these schools are categorized as CSI or as TSI, are provided and used. To fully leverage this opportunity, state leaders will need to understand what ESSA means and says about the level of support that an SEA will need to ensure for these schools moving forward. SEAs must consider the best approaches to promoting and facilitating comprehensive, evidence-based activities that have the greatest potential to lead to success for all students.

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