Are the NC Department of Health and Human Services and the Department of Juvenile Justice and Delinquency Prevention 'local educational agencies' under No Child Left Behind, so that the schools they operate inside their facilities qualify for the LEA-tied federal funds?
Plain-English summary
The federal No Child Left Behind Act of 2001 (NCLB) directs a large share of K-12 funding through entities it calls "local educational agencies," or LEAs. NCLB defines an LEA as a public board of education or other public authority legally constituted within a State for "administrative control or direction of, or to perform a service function for, public elementary schools or secondary schools in a city, county, township, school district, or other political subdivision of a State."
State Superintendent Patricia Willoughby asked whether the NC Department of Health and Human Services (DHHS), which runs residential schools for students with hearing and visual impairments, and the Department of Juvenile Justice and Delinquency Prevention (DJJDP), which runs schools and educational programs inside juvenile detention facilities, qualify as LEAs. The practical stakes were federal: an LEA designation would have unlocked direct NCLB funding streams (and would also have made the two agencies subject to NCLB's accountability framework, including the requirement to let students transfer out of low-performing schools).
Chief Deputy Attorney General Grayson Kelley and Special Deputy Attorney General Thomas Ziko concluded that neither DHHS nor DJJDP is an LEA. They are State agencies, not local boards. They are not governed by elected or appointed boards of education. Their schools admit students from across the entire state (DHHS) or from multiple counties served by regional detention facilities (DJJDP), neither of which fits the NCLB concept of a city, county, township, or school district unit. North Carolina law calls its actual LEAs "local school administrative units" and uses N.C.G.S. § 115C-5, § 115C-37, and § 115C-66 to set up that uniform statewide structure; DHHS and DJJDP sit outside that structure.
The AG flagged a tell: every time the General Assembly wanted DHHS or DJJDP schools to follow the same rules as local school administrative units, the legislature had to add a specific statutory provision saying so. N.C.G.S. § 115C-110 explicitly applies Article 9 (special education) to DHHS and DJJDP. N.C.G.S. § 115C-325(p) extends the public-school teacher employment system. N.C.G.S. § 143B-146.1 directs the DHHS Secretary to coordinate with the State Board of Education on the ABCs accountability program. The need for those specific provisions proves the negative: if DHHS or DJJDP were an LEA by default, none of those bridges would be necessary.
The AG also pointed out a structural mismatch between NCLB's accountability model and the two agencies' settings. NCLB's primary remedy for a chronically underperforming school is letting students transfer to another public school within the same LEA. DHHS residential schools are schools of choice (students can leave at any time), and DJJDP students are incarcerated (they cannot leave at all). The transfer remedy fits neither environment, which the AG read as further confirmation that Congress did not envision state-operated residential or detention schools as LEAs.
Currency note
This opinion was issued in 2005. Subsequent statutory amendments, court decisions, or later AG opinions may have changed the analysis. Treat this page as historical context, not current legal advice. Verify current law before relying on any specific rule, deadline, or remedy mentioned here. The Every Student Succeeds Act (ESSA), signed in 2015, replaced most of NCLB and changed several of the accountability frameworks discussed above. North Carolina's juvenile justice agency has also been reorganized (DJJDP was eventually folded into the Department of Public Safety). Anyone analyzing whether a state-operated school qualifies as an LEA for current federal education funding should start with ESSA, current 34 C.F.R., and the current organic statutes of the relevant state agency.
Background and statutory framework
The NCLB LEA definition. Title IX of NCLB defined "local educational agency" broadly, but every prong of the definition is tied to the concept of local administration of public schools within a political subdivision of a state. The definition expressly includes educational service agencies, BIA schools, and state educational agencies in single-LEA states, but those carve-outs prove the rule: state-operated programs are an LEA only when Congress says so.
North Carolina's LEA architecture. NC uses the term "local school administrative unit" instead of "LEA." Local school administrative units come in two flavors, county and city, both governed by locally-controlled boards of education. The State Board of Education is required to treat all local school administrative units the same way (§ 115C-66). DHHS and DJJDP have no elected or appointed board of education and stand outside the State Board's general jurisdiction.
The specific-provision pattern. Whenever the General Assembly wanted DHHS or DJJDP schools to follow LEA rules, it added a specific statutory provision. The AG read those provisions as legislative recognition that the schools were not LEAs by default. If they were, the cross-application would not be needed.
Why the question mattered for funding. Many NCLB funding streams flowed through formula allocations to LEAs based on enrollment counts, poverty data, and similar metrics. If a state agency was not an LEA, it could not receive the funds directly through that route; the funds had to flow through (or be appropriated alongside) the State educational agency or through other federal program designations.
Common questions
Q: Did this opinion mean DHHS and DJJDP students could not receive federally funded educational services at all?
A: No. It meant the schools were not LEAs for purposes of NCLB's LEA-routed funding streams. Other federal funding mechanisms, including special-education funds under IDEA and federal funds appropriated specifically to State agencies running residential or detention schools, could still flow to those schools. The opinion addressed only the LEA classification question.
Q: Why did the General Assembly specifically extend special education and teacher employment provisions to DHHS and DJJDP if they were not LEAs?
A: Because federal special-education law requires every educational program serving children with disabilities to provide certain services, and the General Assembly had to make sure DHHS and DJJDP schools complied even though they were not LEAs. The teacher employment provisions ensured that teachers in DHHS/DJJDP schools had the same employment protections as teachers in local school administrative units. The need for the specific provisions confirmed the AG's reading.
Q: Could DHHS or DJJDP have voluntarily applied for LEA status?
A: No. LEA status is determined by the legal structure of the entity under state law, not by election. Congress in NCLB looked to state law to determine what entities qualify as LEAs. North Carolina law did not establish DHHS or DJJDP as local school administrative units, so federal NCLB classification followed.
Q: What was the practical outcome of this opinion?
A: DPI could not issue NCLB-flow-through funds to DHHS and DJJDP as if they were LEAs. The agencies' educational programs continued under their separate appropriations and other federal program funding. The accountability requirements of NCLB (such as adequate yearly progress reporting and the transfer remedy) likewise did not attach in the same form to DHHS or DJJDP schools.
Citations
Statutes:
- 20 U.S.C. § 6313(b)(1)(E) (NCLB transfer remedy)
- N.C.G.S. § 115C-5 (local school administrative units)
- N.C.G.S. § 115C-37 (boards of education)
- N.C.G.S. § 115C-66 (uniform State Board treatment of local school administrative units)
- N.C.G.S. § 115C-105.31 (continuation of services)
- N.C.G.S. § 115C-110 (Article 9 special-education provisions applied to DHHS and DJJDP)
- N.C.G.S. § 115C-325(p) (teacher employment system extended to DHHS and DJJDP)
- N.C.G.S. § 143B-164.10 et seq.; § 143B-164.13; § 143B-164.14; § 143B-164.15 (DHHS organic statutes)
- N.C.G.S. § 143B-216.41
- N.C.G.S. § 143B-525
- N.C.G.S. § 143B-529 (DJJDP regional detention facilities)
- N.C.G.S. § 143B-146.1 et seq. (ABCs program coordination)
Source
- Landing page: https://ncdoj.gov/opinions/qualification-for-funding-under-federal-no-child-left-behind-act-of-2001/
Original opinion text
The text below is the closing analytical portion of the opinion as reproduced by the AG's website. The full statement of facts and a step-by-step walk through the LEA definition is preserved here.
(A) IN GENERAL — The term "local educational agency" means a public board of education or other public authority legally constituted within a State for either administrative control or direction of, or to perform a service function for, public elementary schools or secondary schools in a city, county, township, school district, or other political subdivision of a State, or of or for a combination of school districts or counties that is recognized in a State as an administrative agency for its public elementary schools or secondary schools.
(B) ADMINISTRATIVE CONTROL AND DIRECTION — The term includes any other public institution or agency having administrative control and direction of a public elementary school or secondary school.
(C) BIA SCHOOLS — The term includes an elementary school or secondary school funded by the Bureau of Indian Affairs but only to the extent that including the school makes the school eligible for programs for which specific eligibility is not provided to the school in another provision of law and the school does not have a student population that is smaller than the student population of the local educational agency receiving assistance under this Act with the smallest student population, except that the school shall not be subject to the jurisdiction of any State educational agency other than the Bureau of Indian Affairs.
(D) EDUCATIONAL SERVICE AGENCIES — The term includes educational service agencies and consortia of those agencies.
(E) STATE EDUCATIONAL AGENCY — The term includes the State educational agency in a State in which the State educational agency is the sole educational agency for all public schools.
When examined in light of this definition, it is evident that neither DHHS nor DJJDP is an LEA.
DHHS and DJJDP are clearly not "public board[s] of education." But, DHHS and DJJDP are "public authorit[ies] legally constituted within [North Carolina]." Therefore, the first issue to resolve is whether DHHS or DJJDP is constituted for "either administrative control or direction of, or to perform a service function for, public elementary schools or secondary schools in a city, county, township, school district, or other political subdivision of a State." The fact is that, while DHHS and DJJDP operate schools or provide educational programs to the students in their facilities, they do not have administrative control or direction of, or perform a service function for "public schools" in any "political subdivision" of North Carolina.
DHHS's residential schools admit students from all over the State; indeed, DHHS may admit students from outside the State to its residential schools. DJJDP may provide juvenile detention services to juveniles in county detention centers or may provide juvenile detention services through a regional detention facility that may include more than one county, N.C.G.S. § 143B-529. Neither DHHS nor DJJDP has administrative control or direction of, or performs services for public schools in a political subdivision of the State. Even if the definition of LEA could be stretched to say that DHHS and DJJDP have administrative control over schools for "a combination of school districts or counties," i.e., the whole State in the case of DHHS, or the combination of counties served by a regional DJJDP detention facility, North Carolina does not recognize any of those combinations of political subdivisions of the State "as an administrative agency for its public elementary schools or secondary schools."
One of the difficulties in analyzing the status of DHHS and DJJDP under NCLB and State law is that "LEA" is not a term typically used in North Carolina education statutes. Most of the references to "LEA" in the General Statutes relate to special education services statutes which reflect federal statutory requirements.
Instead of the term "LEA," North Carolina law uses the term "local school administrative unit" to describe the political subdivisions of the State responsible for the administration of public schools. N.C.G.S. § 115C-5. "Local school administrative units" are classified as "county school administrative units" or "city school administrative units." N.C.G.S. § 115C-66. All local school administrative units are governed by locally elected county boards of education or appointed city boards of education.
N.C.G.S. § 115C-37. Neither DHHS nor DJJDP is governed by an elected or appointed board of education.
Furthermore, while the State Board of Education is statutorily required to deal with all local school administrative units in the same way, N.C.G.S. § 115C-66, the State Board of Education does not have general jurisdiction over DHHS or DJJDP. It is true that DHHS and DJJDP are occasionally subject to the same statutory obligations and duties imposed on local school administrative units. For example, N.C.G.S. §115C-110 specifically provides that all the special education provisions of Article 9 of Chapter 115C that are specifically applicable to local school administrative units also are applicable to DHHS and DJJDP. Similarly, N.C.G.S. § 115C-325(p) states that the system of employment for public school teachers shall apply to all persons employed in teaching and related educational classes in the schools and institutions of DHHS and DJJDP. The General Assembly has also enacted legislation requiring the Secretary of DHHS to consult and cooperate with the State Board of Education in order to implement the ABC's Program that the State Board of Education administers in the public schools. N.C.G.S. § 143B-146.1 et seq. These special provisions, however, only serve to illustrate that DHHS and DJJDP are not local school administrative units. If either DHHS or DJJDP were actually a local school administrative unit, the General Assembly would not have to make special provisions to subject them to the legal obligations that generally subject North Carolina local school administrative units to the authority of the State Board of Education. Those facts alone prove that neither DHHS nor DJJDP is recognized as an administrative agency for public schools in North Carolina.
Finally, it is self-evident that absent explicit statutory recognition DHHS and DJJDP cannot be classified as "local educational agencies," or "local school administrative units." Although they may operate schools or educational programs for the students entrusted to them, DHHS and DJJDP do not administer, control, direct or serve "public schools." DHHS and DJJDP are not "local" entities of any type. They are State agencies independently funded by the General Assembly rather than through the State Board of Education or from the State School Fund and are administratively independent of the State Board of Education. While they have a mandate to educate children, their unique status is not consistent with the educational model upon which NCLB is premised. For example, the primary remedy the NCLB provides to students in schools which do not make adequate yearly progress is the opportunity to transfer to another public school served by the local educational agency. Title IX, Sec. 1116 (b)(1)(E)(I) (20 U.S.C. § 6313(b)(1)(E). The DHHS residential schools are schools of choice, students are free to leave at any time. The students in the DJJDP educational programs are incarcerated — they have no right to leave the detention facilities to which they are assigned. The inconsistencies between the NCLB accountability model and the operation of the DHHS and DJJDP schools serves to illustrate why these State agencies cannot be considered LEAs for purposes of the federal funding for these programs.
For the reasons stated above, it is our opinion that neither DHHS nor DJJDP meets the definition of LEA purposes of funding under NCLB.
Very truly yours,
Grayson G. Kelley
Chief Deputy Attorney General
Thomas J. Ziko
Special Deputy Attorney General