Braiding and Blending of Federal Funding

Historically both of these practices have been discouraged within federal programs because most
federal education support programs are categorical in nature, meaning that the funds are
allocated by Congress and the ED for a particular category defined in the legislation for each
specific program. However, the practice of braiding funds has been allowed, even encouraged, in
at least the last three reauthorizations of the Elementary & Secondary Education Act (ESEA).

Definitions
Blending of funds means that two or more sources of funds are put together for a purpose in
such a way that it would be difficult or impossible to tell which source went for whatever the funds
were spent.
Braiding of funds means that two or more sources of funds are spent for a purpose (maybe the
same purpose) in such a way that the funds could still be accounted for separately.

Examples
Blending of Funds - concept which has become popular in the reauthorization of
ESEA, the NCLB Act of 2001.

Blending happens when you combine two sources of Title federal funds into one and
only track the funds expended as if it were all from one source. This occurs in a
limited manner in NCLB.
School systems are limited in two ways.
1) Only certain programs may be blended.
The four programs from which you may move funds are Title II, Part A (Teacher Quality
Program), Title II, Part D (Ed. Technology), Title IV, Part D (Safe & Drug Free Schools),
and Title V, (Innovative Programs).
Funds may be transferred to the same four Title programs plus Title I, Part A.
Funds may not be transferred from Title I.
2) There is a limit on the amount of funding which may be blended.
A school system can move up to 50% of funds from any of four NCLB Titles to any of five
Titles.
The 50% limit is further restricted to 30% when a school system is "identified for
improvement", and is eliminated (0%) when a school system is identified for "corrective
action".
Moving funds from one program to another is accomplished using an Inter fund transfer
request.

Braiding of Funds
Following is an example of braiding funds to provide professional development.

Title I allows funds to be used to provide professional development (as defined in NCLB).
Title II also allows funds to be used for professional development (as defined in NCLB).
A school system could use Title I funds to provide a particular professional development
program (e.g. phonemic awareness for primary grades) in Title I schools and then use
Title II funds to provide the same professional development for non-Title I schools. This
means that both sources of funds could be used to support a system wide professional
development effort that is supplemental in nature (because no local funds support it and it
could not exist with local funds) thus the funds are braided. The funding can be used to

support the same effort, but are accounted for separately through good accounting
procedures.
Following is an example of how the categorical nature of federal funding sometimes does
not permit braiding.
Title I funds allow for hiring of reading and math specialists in Title I schools.
Title II funding could not be used for that purpose in non-Title I schools because it is not
an allowable expense in Title II.
Braiding funds might lead a school system close to the "supplement vs supplant" issue.
Funds from NCLB Title programs are to be supplemental in nature.
If these funds are used to provide something that is required by local, state law or
polity or other federal law then supplanting occurs and a district may have to pay the
funds back to the program if discovered in an audit.
Another way that supplant happens is if a school system uses federal funds to pay for
something that has previously been paid from local funds. Braiding might be
problematic in the supplant area if a school system decides that it wants everyone to
have a particular textbook and then pays for those texts from Title I funds only in Title I
schools.

Above all else, NCLB requires all funds spent to have an impact on student learning and
must be planned to be spent according to a needs assessment that is based on hard data,
not opinion.