CAARO Update Issue #2026-06
May 5, 2026: Categorical Allocations and Audit Resolution Office (CAARO) Updates – twice monthly notifications of key reporting deadlines, applications for funding, annual audits, and any other topics related to programs administered by CAARO.The purpose of the California Department of Education (CDE) CAARO updates is to provide local educational agencies (LEAs) and other interested parties with timely information related to programs administered by CAARO.
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Key Dates
| Description | Dates |
|---|---|
Expenditure Deadline for One-Time State Programs
|
6/30/2026 |
FY 2026-27 Reporting Window for Consolidated Application and Reporting System (CARS) Application for Funding Page |
05/01/26 - 12/15/26 |
Federal Categorical Program Updates
Categorical Programs - Allocations & Apportionments (CA Dept of Education)
Title I, Title II, Title III, and Title IV
- Federal Cash Management Data Collection (CMDC) closed on April 30, 2026. Cash balances submitted by LEAs through CMDC are used to calculate LEA payments.
- The Preliminary State Reservation Tables for FY 2026-27 were received by CDE on March 13, 2026. For a summary of preliminary allocations, see CAARO Update Issue #2026-04, issued on April 6, 2026.
- FY 2026–27 Preliminary Allocations are currently being calculated and are expected to be posted in May 2026.
FY 2026–27 Consolidated Application and Reporting System Application for Funding Timeline Change
The California Department of Education is updating the timeline for the Application for Funding in the Consolidated Application and Reporting System (CARS) starting with the Spring Release in 2026–27. LEAs will now be able to apply for federal funds in CARS from May 1, 2026, to December 15, 2026. This changed deadline will have many advantages for LEAs including earlier Federal allocation finalization and alignment with other data systems within the Department of Education. The CARS Application for Funding will be closed after December 15, 2026.
Applications for the following programs in CARS from the Elementary and Secondary Education Act (ESEA) of 1965, as amended by Every Student Succeeds Act (ESSA) of 2015 are impacted:
- Title I, Part A, Improving the Academic Achievement of the Disadvantaged;
- Title I, Part D, Neglected, Delinquent, or At-risk;
- Title II, Part A, Supporting Effective Instruction;
- Title III, Part A, English Language Acquisition, Language Enhancement, and Academic Achievement;
- Title IV, Part A, Student Support and Academic Enrichment; and
- Title V, Part B, Rural Education Achievement Program.
Over the past decade, LEAs have struggled to finalize budgets and expenditures for their federal programs because of the timeline in posting final allocations. Some years, the final allocations have been posted in April of the following year, nearly 11 months after the application opened in May, and part of this delay is attributed to the length of the CARS application for funding availability. Since 99% of LEAs apply for funding prior to November of the funding year, the updated timeframe will not impact most LEAs. The change in CARS application close date will facilitate earlier finalization of final allocations for all programs listed above.
The CDE will be sending reminders of the new close date to CARS User Administrators, CARS Authorized Representatives, District Superintendents, County Office of Education Superintendents, Direct Funded Charter Administrators, Chief Business Officers, and federal program contacts at all LEAs.
Please do not hesitate to contact the CARS office or Federal Program offices with your questions. An email address for each program is listed below.
CARS conappsupport@cde.ca.gov
Title I, Part A and Title I, Part D TitleI@cde.ca.gov
Title II TitleII@cde.ca.gov
Title III LPLO@cde.ca.gov
Title IV TitleIV@cde.ca.gov
Title V Reap@cde.ca.gov
State Categorical Program Updates
Categorical Programs - Allocations & Apportionments (CA Dept of Education)
Classified School Employee Summer Assistance Program (CSESAP)
- LEAs that elected to participate in the CSESAP during the 2026–27 school year were required to notify the CDE by April 1, 2026, of their election. As part of the notification, LEAs reported to the CDE the number of classified employees that elected to participate in the CSESAP and the total estimated amount to be withheld from participating classified employee paychecks for the 2026–27 school year.
- Based on the estimated data reported, the CDE determined that a participating classified employee is estimated to receive state match funding equal to approximately forty-nine and five tenths cents ($0.495) for each one dollar ($1) that the classified employee elects to have withheld from their monthly paycheck for the 2026–27 school year. A copy of the letter and accompanying schedule of the estimated amount of state match funding for each participating LEA is available on the CDE’s CSESAP 2025 Funding Results web page.
- Pursuant to California Education Code Section 45500(g), participating LEAs are required to notify participating classified employees by June 1, 2026, of the amount of estimated state match funds the participating classified staff is estimated to receive as a result of participating in the CSESAP. The final state match amount will be based on LEA’s actual withholdings reported to the CDE by July 31, 2027, and may be greater or less than the preliminary estimates provided in May 2026.
- For additional information on the CSESAP including key dates, refer to the letter dated December 8, 2025, and the frequently asked questions posted on the CSESAP web page. For questions regarding this program, please contact the Categorical Allocations and Audit Resolution Office by email at csesap@cde.ca.gov.
Reversing Opioid Overdose
- The county office of education (COE) allocations will be available in May on the CDE’s Reversing Opioid Overdose web page, with the funds to be released in June 2026.
Literacy Instruction Professional Development
- The allocations for the Literacy Instruction Professional Development funding provided in Section 83 of Assembly Bill 121 (Chapter 8, Statutes of 2025) will be available in May, with the apportionment to be released in late June. Funding is available to school districts, county offices of education, charter schools, and state special schools to support the implementation of California Education Code (EC) Section 33319.6
. - Funds will be allocated on an equal amount per full-time equivalent (FTE) certificated staff who teach pupils in transitional kindergarten, kindergarten, or any of grades 1 to 5, inclusive, using the data submitted through the California Longitudinal Pupil Achievement Data System (CALPADS) as of October 2025. CAARO will provide the per-FTE certificated staff funding rate once it is available.
- Information regarding the program timeline, reporting requirements, and professional development criteria is available on the CDE’s Literacy Professional Development Programs web page. Details regarding the funds will be available on the CDE’s Categorical Programs web page.
Audit Resolution Updates
Local Educational Agency Annual Audits - Auditing (CA Dept of Education)
Management Decision Letters and Correction Action for 2024–25 Audit Findings
- Management decision letters for the 2024–25 audit findings are currently being issued.
- LEAs should provide corrective action to the CDE within three weeks of receiving a management decision letter.
Key Dates for 2024-25 Kindergarten Through Grade Twelve (K–12) Annual Audit
- 5/15/2026 – COE certifications of annual audits due to the CDE and State Controller’s Office (SCO) can be found on the COE Certification web page.
- The 2024–25 audit reports were due by 12/15/2025. Reports and any corrective action were required to be reviewed by the governing school board by 1/31/2026. Corrective action was due to be submitted to the COE by March 15, 2026. If your 2024–25 audit report has not been completed and submitted as required, submit the report as soon as possible. The report should be presented to the board within 45 days of submission.
FY 2025-26 Supplemental Audit Guide
- The FY 2025–26 Supplemental Audit Guide will be available on the Education Audit Appeals Panel (EAAP)
website.
For a summary of changes, see CAARO Update Issue #2026-02, issued on February 25, 2026.