Prepare Now for Tough End-of-Year Issues
Washington Bits and Bites
House Committee Passes 529 Expansion
Many families around the country use 529 savings plans to save and pay for college. The 2017 tax bill expanded the potential uses of 529 accounts to allow families to withdraw up to $10,000 per year per child for K-12 tuition expenses. Currently, these funds cannot be used for other expenses. On April 2, the House Ways and Means Committee passed several pieces of tax legislation, including H.R. 1994 to further expand 529s to allow families to use the money for fees, tutoring, special needs services, books, supplies, and other equipment. The overall $10,000 limit will still apply. This legislation came out of committee with bipartisan support, which bodes well for its passage by the full House.
Department of Education Allows Religious Providers to Offer Equitable Services
On March 11, Secretary of Education Betsy DeVos announced the U.S. Department of Education will no longer enforce a restriction that prohibits religious providers from providing services such as professional development to private school educators under the Elementary and Secondary Education Act. The department based this decision on a 2017 U.S. Supreme Court ruling in the Trinity Lutheran case where the court stated religious entities cannot be excluded from a generally available benefit solely based on religion. Services provided still must be secular, neutral, and nonideological.
New Nonprofit Tax Proposal
Rep. Carolyn B. Maloney (D-NY) introduced legislation—the Nonprofit Relief Act of 2019—that repeals the silo requirement requiring nonprofits to separately calculate and track income and losses for each unrelated trade or business, updates the mileage reimbursement rate for nonprofit volunteers, and expands the new paid family and medical leave tax credits to allow nonprofits to participate. This bill complements other legislative proposals that repeal the 21% tax to nonprofits on transportation and parking benefits. However, it is unclear if Congress will reach bipartisan agreement needed to move these bills quickly.
DHS Issues New DSO Resources
The U.S. Department of Homeland Security (DHS) published new resources for school staff who serve as the designated school official (DSO) for their institution’s international student program. DSOs are responsible for working with international students and maintain Student and Exchange Visitor Program (SEVIS) records. It is more important than ever that DSOs fully understand their obligations and responsibilities—the Government Accountability Office just released a report highlighting additional steps DHS can take to address current fraud risks in international student programs and new F-1 student visa regulations may be forthcoming this fall.
Question from the Field
As we look forward to the 100 days of May, I can already see end-of-year issues on the horizon. One former parent is trying to get a copy of a teacher recommendation from two years ago and is threatening to sue us under FERPA. Another parent is upset about the disciplinary process we went through with his son for coming to the prom after drinking. And, we have a staff member who we will not be having teach next year, but she doesn’t know that yet. How do we get a handle on all of these boiling pots?
This spring is heating up quickly around the country. Last week we received questions on all the topics above—in a single day. Some of them are less concerning: The Family Education Rights and Privacy Act (FERPA) only applies in very limited circumstances and there is no private right of action under the law. Others feel more distressing—how clean is your disciplinary process and have you deviated from your own procedures? End of year brings a quagmire of simmering employment issues (does the teacher have a contract for the next year?).
In late April and May, simmering topics tend to boil over as the end of the academic year comes into view. Now is the time to identify topics that could reach their boiling point and start to manage, delegate, or plan for each of them. Pull together your leadership team and do a thorough run through of student, parent, and staff issues that may erupt over the next two months. Identify who is needed for potential decision making and what the general course of action may be. Are there legal components? If so, set up a time to bring your attorney up to speed so they can easily help address the issue. Are there communications or PR-related issues? Begin to talk through what those are and what the plan will be for each. Does the board need to be informed of any of the issues as they arise? Set up extra time to talk through each of them with your board chair and other relevant officers so there are no surprises and the school can respond nimbly. A little organization now will create more time for clear thinking and quick action later.
Legal News You Can Use
Donors Don’t Choose? School districts around the country are struggling with whether to allow teachers to use crowdfunding platforms like Donors Choose. Some districts are prohibiting the practice altogether while others require projects to be approved by a central office, citing legal, privacy, technology security, and other concerns. Read this new EdSurge report on ways schools are evaluating the pros and cons of such fundraising efforts.
Employee vs. Independent Contractor: Is a worker an employee or an independent contractor? One of the more complicated questions employers must answer, it often turns on how much control the employer has over the individual. Frequently employers consider how many standards and policies they can require workers to follow before workers become employees. The 5th Circuit Court of Appeals just issued a very pro-employer decision stating that workers who had to take mandatory safety training and comply with drug and alcohol policies were still independent contractors because they could turn down assignments. For more information about independent contractors in the independent school setting, read this NAIS legal advisory.
Medical Marijuana and the Workplace: The increased availability and legality of marijuana (both medical and otherwise) at the state level continue to exist uneasily with other employment and disability discrimination laws. In a recent federal court decision in New Jersey, the court ruled an employer that required drug tests for continued employment did not discriminate against an employee who was prescribed marijuana for injury pain management. Results may vary based on particular state laws and how they interact with federal drug classification, so employers still should tread carefully in this area. For more information about marijuana and the workplace, read this article from the Society for Human Resource Management.
Accommodating, But Hostile: Courts differ on whether employees can allege they suffer from a hostile work environment under the Americans with Disabilities Act (ADA). Recently the 2nd Circuit Court of Appeals declared the answer yes in its jurisdiction. In this case, an employee with Tourette syndrome alleged that other employees mocked and mimicked his tics, the comments went on for months, and managers witnessed the comments. While the court ultimately rejected the employee’s discrimination, retaliation, and failure to accommodate arguments, it allowed the hostile work environment claim to move forward. For more information on the ADA, read this NAIS legal advisory.