[Federal Register Volume 64, Number 95 (Tuesday, May 18, 1999)]
[Proposed Rules]
[Pages 27152-27158]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 99-12456]
[[Page 27151]]
_______________________________________________________________________
Part VI
Department of Education
_______________________________________________________________________
34 CFR Part 76
State-Administered Programs; Proposed Rule
Federal Register / Vol. 64, No. 95 / Tuesday, May 18, 1999 / Proposed
Rules
[[Page 27152]]
DEPARTMENT OF EDUCATION
34 CFR Part 76
State-Administered Programs
AGENCY: Department of Education.
ACTION: Notice of proposed rulemaking.
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SUMMARY: The Secretary proposes to amend the Education Department
General Administrative Regulations (EDGAR) governing State-administered
programs. These proposed regulations are necessary to implement a
recent statutory change that affects all elementary and secondary
education programs administered by the United States Department of
Education (Department) under which the Secretary allocates funds to
States on a formula basis. The proposed regulations would ensure that
charter schools opening for the first time or significantly expanding
their enrollment receive the funds for which they are eligible under
these programs.
DATES: We must receive your comments on or before July 19, 1999.
ADDRESSES: Address all comments about these proposed regulations to
Leslie Hankerson, U.S. Department of Education, 400 Maryland Avenue,
SW., room 3C120, Washington, DC 20202-6140. If you prefer to send your
comments through the Internet, use the following address:
comments@ed.gov. You must include the term ``Charter Schools'' in the
subject line of your electronic message.
If you want to comment on the information collection requirements,
you must send your comments to the Office of Management and Budget at
the address listed in the Paperwork Reduction Act section of this
preamble. You may also send a copy of these comments to the Department
representative named in this section.
FOR FURTHER INFORMATION CONTACT: Leslie Hankerson, U.S. Department of
Education, 400 Maryland Avenue, SW., room 3C120, Washington, DC 20202-
6140. Telephone: (202) 205-8524. If you use a telecommunications device
for the deaf (TDD), you may call the Federal Information Relay Service
(FIRS) at 1-800-877-8339.
Individuals with disabilities may obtain this document in an
alternative format (e.g., Braille, large print, audiotape, or computer
diskette) on request to the contact person listed in the preceding
paragraph.
SUPPLEMENTARY INFORMATION:
Invitation To Comment
We invite you to submit comments regarding these proposed
regulations. The Secretary is particularly interested in public
comments on whether the Department should regulate on what constitutes
an expansion of enrollment, or allow States the flexibility to define
the term within the context of the State procedures established under
these proposed regulations. The Secretary is also particularly
interested in public comments on the practical administrative issues
that States and local educational agencies (LEAs) will need to address
when allocating funds to charter schools under these proposed
regulations. One issue that arises under programs that provide for
formula allocations by State educational agencies (SEAs) to LEAs, such
as Part B of the Individuals with Disabilities Education Act (IDEA),
for example, is whether additional guidance is needed on the range of
permissible options available to SEAs in meeting their obligations
under these proposed regulations. To ensure that your comments are
fully considered in developing the final regulations, we urge you to
identify clearly the specific section or sections of the proposed
regulations that each of your comments addresses and to arrange your
comments in the same order as the proposed regulations.
Under the Department's Principles for Regulating, we regulate only
if absolutely necessary, and then only in the least burdensome manner
necessary. These proposed regulations contain some provisions that
either repeat statutory requirements, give the Department's
interpretations of the statute, or describe permissible, rather than
required, ways of implementing the statute. The Secretary particularly
requests public comment on whether any or all of these provisions
should be removed from the regulations and issued instead in the form
of guidance.
We invite you to assist us in complying with the specific
requirements of Executive Order 12866 and its overall requirement of
reducing regulatory burden that might result from these proposed
regulations. Please let us know of any further opportunities we should
take to reduce potential costs or increase potential benefits while
preserving the effective and efficient administration of the program.
During and after the comment period, you may inspect all public
comments about these proposed regulations in room 3C120, Federal Office
Building 6, U.S. Department of Education, 400 Maryland Avenue, SW.,
Washington, DC, between the hours of 8:30 a.m. and 4:00 p.m., Eastern
time, Monday through Friday of each week except Federal holidays.
Assistance to Individuals With Disabilities in Reviewing the
Rulemaking Record
On request, we will supply an appropriate aid, such as a reader or
print magnifier, to an individual with a disability who needs
assistance to review the comments or other documents in the public
rulemaking record for these proposed regulations. If you want to
schedule an appointment for this type of aid you may call (202) 205-
8113 or (202) 260-9895. If you use a TDD, you may call the Federal
Information Relay Service at 1-800-877-8339.
Background
Congress enacted the Charter School Expansion Act of 1998 (Act) on
October 22, 1998. Among other things, the Act amended title X, part C
of the Elementary and Secondary Education Act of 1965 (ESEA) and
reauthorized the Public Charter Schools Program (PCSP) through fiscal
year 2003. The Act also added a requirement under section 10306 of the
ESEA that applies to all Department programs under which the Secretary
allocates funds to States on a formula basis. Section 10306 requires
the Secretary and States to take measures to ensure that eligible
charter schools receive their commensurate share of funds under the
covered programs in their first year of operation and in succeeding
years when they expand their enrollment (20 U.S.C. 8065a).
These proposed regulations are necessary to ensure that States
understand their responsibilities under section 10306 of the ESEA and
take appropriate steps to fulfill those responsibilities. The Secretary
encourages States to use these proposed regulations as a guide in
meeting the requirements of section 10306 of the ESEA pending issuance
of final regulations.
Summary of Proposed Provisions
The proposed provisions would amend Part 76 of EDGAR by
redesignating subpart H as subpart I, and adding a new subpart H. For
covered programs in which States and LEAs allocate funds by formula,
this subpart would require States and LEAs to implement procedures that
ensure that each charter school opening for the first time or
significantly expanding its enrollment on or before November 1 of an
academic year receives the full amount of funds for which it is
eligible within five months of the date the charter school opens or
significantly expands its enrollment. For each charter
[[Page 27153]]
school opening or significantly expanding its enrollment after November
1 but before February 1 of an academic year, this subpart would require
States and LEAs to implement procedures that ensure that the charter
school receives at least a pro rata portion of the funds for which the
charter school is eligible within five months of the date the charter
school opens or significantly expands its enrollment. For each charter
school opening or significantly expanding its enrollment on or after
February 1, this subpart would permit, but not require, States and LEAs
to implement procedures to provide the charter school with a pro rata
portion of the funds for which the charter school is eligible under a
covered program. For covered programs in which States and LEAs award
funds through a competitive process, this subpart would require States
and LEAs to implement procedures that ensure that each eligible charter
school scheduled to open during the academic year has a full and fair
opportunity to compete to participate in the program.
In determining a charter school's eligibility to receive funds
under a covered program during an academic year in which the charter
school opens for the first time or significantly expands its
enrollment, States and LEAs could not, under this subpart, rely on
enrollment or eligibility data from a prior year, even if allocations
to other LEAs or public schools are based on a prior year's data. These
proposed regulations are based on statutory provisions that require
eligibility to be determined based on current enrollment data of newly
opened or expanded charter schools. This subpart would not apply to
SEAs or LEAs that do not allocate funds or hold competitions among
eligible applicants under an applicable covered program. Nor would this
subpart have any effect on a charter school's eligibility to receive
funds under a covered program during years in which the charter school
is neither opening for the first time nor significantly expanding its
enrollment. In those years, SEAs and LEAs should provide funds to
charter schools meeting the statutory requirements for eligibility
under the applicable program on the same basis as they provide funds to
other LEAs and public schools. This subpart would override other
Federal regulations to the extent that they are inconsistent with the
provisions of this subpart.
General
Sections 76.785 through 76.787 describe the purpose of, define
several key terms, and identify the entities that would be governed by
this subpart. This subpart would apply to all SEAs and LEAs that fund
charter schools under a covered program, even if the State does not
participate in the PCSP. Any State agency that is not an SEA but
administers a covered program would also be required to comply with the
provisions of this subpart that apply to SEAs. Examples of these State
agencies include, but are not limited to, State vocational education
agencies (Vocational Education Basic Grants and Tech-Prep Education),
State agencies for higher education (Eisenhower Professional
Development Grants), and the State agency that administers the
Governor's Programs under the Department's Safe and Drug-Free Schools
Program. Charter schools that are scheduled to open for the first time
or significantly expand their enrollment during a given academic year,
and wish to participate in a covered program in accordance with this
subpart, would have to meet certain requirements.
The Secretary considers an expansion in enrollment to be
significant when a charter school experiences a substantial increase in
the number of eligible students under a covered program due to a
significant event that is unlikely to occur on a regular basis, such as
the addition of one or more grades or educational programs at the
charter school.
Section 76.787 defines several key terms that are used in this
subpart. Charter school has the same meaning as provided in the
authorizing statute for the PCSP, title X, part C of the ESEA. A
charter school that meets this definition and meets the eligibility
requirements of the applicable covered program could receive funds
under the program in accordance with the requirements of this subpart,
regardless of whether the charter school receives funds under the PCSP.
In order for a charter school to meet the ESEA definition, the charter
school, among other things, would have to be located in a State with a
law specifically authorizing the establishment of charter schools. This
subpart defines charter school LEA as a charter school that is treated
as an LEA for purposes of the applicable covered program. Under this
definition, a charter school could be treated as an LEA for purposes of
some covered programs but not others.
This subpart defines a covered program as any elementary or
secondary education program administered by the Department in which the
Secretary allocates funds to States on a formula basis. This definition
includes the Department's major formula grant programs under which
States sub-allocate funds to LEAs by formula, such as Title I, Part A
(Basic Grants to LEAs) of the ESEA; Part B (Grants to States and
Preschool Grants) of IDEA; and Titles I and II (Basic Grants and Tech-
Prep, respectively) of the Carl D. Perkins Vocational and Technical
Education Act of 1998. The covered programs also include programs such
as Safe and Drug-Free Schools, Even Start Family Literacy, Goals 2000,
and Adult Education and Family Literacy, under which the Secretary
allocates funds to States by formula but States award some or all
subgrants to LEAs and other eligible applicants through a competition.
The term covered program does not include formula grant programs, such
as Impact Aid or Indian Education, under which the Secretary allocates
funds directly to LEAs.
Local educational agency would have the same meaning in this
subpart as it has in the authorizing statute for the applicable covered
program. For covered programs authorized under the ESEA, for example,
the Title XIV definition of LEA would apply; for covered programs
authorized under Part B of IDEA, LEA would have the same meaning as
provided in section 602 of IDEA and 34 CFR 300.18. Because both the
ESEA and IDEA definitions of LEA rely heavily on State law, the
Secretary generally defers to States in determining whether a charter
school is an LEA for purposes of a covered program. The State
determination must be consistent with Federal and State law, however,
and may not violate any established State policies or practices. The
Secretary urges States to develop clear policies for determining
whether charter schools in the State are LEAs or public schools within
an LEA for purposes of a covered program.
Responsibilities for Notice and Information
Sections 76.788 and 76.789 describe the responsibilities of the
entities that would be governed by this subpart to provide notice and
information. A charter school that is scheduled to open for the first
time or significantly expand its enrollment during the academic year
and wishes to receive funds under a covered program in accordance with
this subpart would be required to provide its SEA (or other responsible
State agency) or LEA, as appropriate, with at least 120 days' written
notice of the date the charter school is scheduled to open or
significantly expand its enrollment. An eligible charter school that
fails to comply with this notice requirement still would receive its
allocation under the applicable covered
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program, but the responsible SEA or LEA would not necessarily be bound
by the time periods specified in Sec. 76.793. Unless the SEA or LEA
receives actual notice of the date the charter school is scheduled to
open or significantly expand its enrollment from another source (e.g.,
an authorized chartering agency) at least 120 days before that date,
the SEA or LEA would be required only to make allocations to the
eligible charter school within a reasonable period of time after the
charter school opens or significantly expands its enrollment.
In order to receive funds under a covered program, a charter school
must establish its compliance with all applicable program requirements
on the same basis as other LEAs. Upon request, a charter school must
also provide its SEA or LEA with any data or information that is
readily available to the charter school and that the SEA or LEA
believes will assist it in estimating the amount of funds the charter
school may be eligible to receive under a covered program when the
charter school actually opens or significantly expands its enrollment.
An SEA or LEA might request, for example, pre-registration lists or
enrollment data from the prior academic year. While an SEA or LEA could
not require a charter school to create any new data or information
prior to opening or significantly expanding its enrollment, once the
charter school has opened or significantly expanded its enrollment, it
would be required to provide the SEA or LEA with actual enrollment and
eligibility data at a time reasonably required by the SEA or LEA. If a
charter school fails to provide any required enrollment or eligibility
data to its SEA or LEA, the SEA or LEA could withhold funds from the
charter school until the charter school provides the data.
While enrollment or eligibility data from a prior year may be used
to estimate a charter school's projected enrollment on or after the
date the charter school opens or significantly expands its enrollment,
in accordance with Secs. 76.791(a) and 76.796(b), an SEA or LEA could
not use a prior year's data to determine the charter school's
eligibility to participate in a covered program or to make any required
adjustments to allocations under a covered program. This subpart would
not preclude an SEA or LEA, however, from relying on data from a prior
year to determine the amount of funds a charter school that is not
opening for the first time or significantly expanding its enrollment is
eligible to receive under a covered program.
Once an SEA or LEA has received notice of the date a charter school
is scheduled to open or significantly expand its enrollment,
Sec. 76.789 of this subpart would require the SEA or LEA to provide the
charter school with timely and meaningful information about each
covered program in which the charter school may be eligible to apply to
participate. The SEA or LEA would be required to provide this
information to the charter school, regardless of whether the charter
school complies with the notice requirement in Sec. 76.788(a), if the
SEA or LEA receives actual notice of the date the charter school is
scheduled to open or significantly expand its enrollment through some
other means or source. In cases where the responsible SEA or LEA also
serves as the authorized chartering agency, for example, the SEA or LEA
is likely to have actual notice of the date the charter school is
scheduled to open or significantly expand its enrollment, even if the
charter school does not provide official notice in accordance with
Sec. 76.788(a).
Under this subpart, an SEA or LEA would be considered to have
provided timely information to a charter school if the charter school
receives the information well enough in advance to be able to take the
necessary steps to apply to participate in the program, but not so far
in advance that the information is of little or no use to the charter
school. An SEA or LEA would be considered to have provided meaningful
information to a charter school if the information is complete and in a
format that is clear and understandable.
Allocation of Funds
Section 76.790 describes the circumstances under which SEAs and
LEAs would have to comply with this subpart. In order for a charter
school to receive funds from an SEA or LEA in accordance with this
subpart, the charter school would have to (1) open for the first time
or significantly expand its enrollment during the academic year; (2)
meet the eligibility requirements of the applicable covered program;
and (3) comply with Sec. 76.788(a) (notice). In order to ensure that
charter schools receive the funds for which they are eligible in
accordance with this subpart, paragraph (b) of Sec. 76.790 would permit
SEAs and LEAs to reserve funds or make initial allocations to eligible
charter schools based on estimates of the projected enrollment at the
charter school on or after the date the charter school opens or
significantly expands its enrollment.
Under Sec. 76.791, the determination of whether a charter school is
eligible to receive funds under a covered program must be based on
actual enrollment or other eligibility data for the charter school on
or after the date the charter school first opens or significantly
expands its enrollment. For the year a charter school is opening or
significantly expanding its enrollment, an SEA or LEA would be
precluded from determining the charter school's eligibility to
participate in a covered program on the basis of enrollment or
eligibility data from a prior year, even if eligibility determinations
for other LEAs and public schools under the program normally are based
on data from a prior year. Thus, an SEA or LEA could not deny funding
to an otherwise eligible charter school merely because the amount of
funds LEAs or public schools are eligible to receive under the program
is based on data from a prior year. Nor could an SEA or LEA deny
funding to an otherwise eligible charter school merely because the
charter school is not open or has not significantly expanded its
enrollment as of the date the SEA or LEA makes allocations to other
LEAs or public schools under the applicable covered program.
Section 76.792 would require SEAs and LEAs to implement procedures
to ensure that eligible charter schools receive their commensurate
share of funds under a covered program. Eligible charter schools that
first open or significantly expand their enrollment on or before
November 1 of an academic year would receive their full allocations
under a covered program, and eligible charter schools that first open
or significantly expand their enrollment between November 1 and
February 1 would receive a pro rata share of funds. The pro rata amount
would be based on the number of months during the academic year that
the charter school will participate in the applicable program compared
to the total number of months in the academic year. Although eligible
charter schools that open on or after February 1 would not necessarily
receive any funds under a covered program, this subpart would give
States discretion to implement procedures to provide eligible charter
schools in this category with a pro rata portion of funds.
The Secretary recognizes the potential administrative burden that
the new statutory requirement may place on States and localities and,
accordingly, intends to allow SEAs and LEAs maximum flexibility to
develop procedures under this subpart that will enable them to comply
with section
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10306 of the ESEA in a manner that minimizes any disruption in State
and local administration of covered programs. Examples of procedures
SEAs and LEAs could implement include reserving an appropriate amount
of funds from their total allocation under a covered program; reserving
an appropriate amount of funds from the allocation to a particular LEA
or public school based on the number of students from that LEA or
public school who are expected to attend the charter school; and using,
for charter school allocations, any carryover, reallocation, State or
local administration, or other discretionary funds that may be
available at the State and local levels.
Section 76.793 specifies the time periods within which SEAs and
LEAs would be required to make allocations to eligible charter schools
under this subpart. SEAs and LEAs with at least 120 days' notice of the
date an eligible charter school is scheduled to open or significantly
expand its enrollment would be required to make allocations to a
charter school that first opens or significantly expands its enrollment
on or before November 1 of an academic year within five months. SEAs
and LEAs would also be required to make allocations to eligible charter
schools that first open or significantly expand their enrollment
between November 1 and February 1 of an academic year within five
months. In accordance with Sec. 76.788(a)(2), SEAs and LEAs would not
be required to meet these deadlines if they do not receive actual
notice of the date an eligible charter school is opening or
significantly expanding its enrollment at least 120 days before the
opening or expansion.
Section 76.794 addresses the applicability of this subpart to
covered programs in which SEAs and LEAs award funds on a competitive
basis. Because the ultimate decision on whether to fund an eligible
applicant under a discretionary covered program lies within the
discretion of the SEA or LEA, a charter school could be eligible to
participate in a discretionary covered program and still not receive
funding under the program. Accordingly, Sec. 76.794(a) applies to
competitive discretionary programs and would require SEAs and LEAs to
provide charter schools that are scheduled to open for the first time
or significantly expand their enrollment on or before the closing date
of any competition with a full and fair opportunity to apply to
participate in the program.
An SEA or LEA generally provides a charter school with a full and
fair opportunity to participate in a discretionary covered program if
it provides the charter school with timely and meaningful information
about the program, including notice of the dates of any upcoming
competitions. When awarding funds under competitive discretionary
programs, an SEA would not be required to provide a full and fair
opportunity to apply to participate to any charter school LEA that is
scheduled to open after the closing date of a subgrant competition. Nor
would the SEA be required to delay a subgrant competition in order to
allow a charter school LEA that has not yet opened to compete for funds
under a covered program. Paragraph (b) of Sec. 76.794 would specify
that SEAs and LEAs would not be required to comply with the
requirements of this subpart when distributing funds under
discretionary covered programs in which the SEA or LEA does not hold a
competition. When distributing funds under noncompetitive discretionary
programs, however, SEAs and LEAs are encouraged to consider charter
schools on an equitable basis with other LEAs and public schools.
Adjustments
Under Sec. 76.796, an SEA or LEA that allocates more or fewer funds
to a charter school than the amount for which the charter school is
eligible to receive under a covered program would be required to make
appropriate adjustments. While SEAs and LEAs would have the flexibility
to make the adjustments during the same year if they choose, they would
not be required to make any adjustments until the succeeding year when
they make allocations under the applicable covered program.
Any required adjustments to allocations for a given academic year
must be based on actual enrollment or eligibility data for the charter
school on or after the date the charter school opens or significantly
expands its enrollment. The adjustments may not be based on enrollment
or eligibility data from a prior year, even if allocations to other
LEAs and public schools under the applicable covered program are based
on a prior year's data.
Applicability of This Subpart to LEAs
Section 76.799 clarifies that this subpart would apply to LEAs that
are responsible for funding charter schools under covered programs on
the same basis as the subpart would apply to SEAs. In accordance with
existing Federal regulations applicable to the covered programs, the
State would be directly responsible for ensuring that LEAs meet the
requirements of section 10306 of the ESEA as well as this subpart.
Clarity of the Regulations
Executive Order 12866 and the President's Memorandum of June 1,
1998 on ``Plain Language in Government Writing'' require each agency to
write regulations that are easy to understand.
The Secretary invites comments on how to make these proposed
regulations easier to understand, including answers to questions such
as the following:
Are the requirements in the proposed regulations
clearly stated?
Do the proposed regulations contain technical terms or
other wording that interferes with their clarity?
Does the format of the proposed regulations (grouping
and order of sections, use of headings, paragraphing, etc.) aid or
reduce their clarity?
Would the proposed regulations be easier to understand
if we divided them into more (but shorter) sections? (A ``section''
is preceded by the symbol ``Sec. ''and a numbered heading; for
example, Sec. 76.785 What is the purpose of this subpart?)
Could the description of the proposed regulations in
the SUPPLEMENTARY INFORMATION section of this preamble be more
helpful in making the proposed regulations easier to understand? If
so, how?
What else could we do to make the proposed regulations
easier to understand?
Send any comments that concern how the Department could make these
proposed regulations easier to understand to the person listed in the
ADDRESSES section of the preamble.
Regulatory Flexibility Act Certification
The Secretary certifies that these proposed regulations would not
have a significant economic impact on a substantial number of small
entities. The small entities affected would be small LEAs and charter
schools. The requirements in these proposed regulations would benefit
charter schools by ensuring that they receive the Federal-to-State
formula funds for which they are eligible within their first year of
operation and in subsequent years when they significantly expand their
enrollment. The flexibility in these proposed regulations would benefit
charter schools by improving customer service, and States by easing the
increased administrative burden that is anticipated as a result of the
statutory requirement.
Paperwork Reduction Act of 1995
Sections 76.788, 76.789, 76.792, and 76.794 contain information
collection requirements. Under the Paperwork Reduction Act of 1995 (44
U.S.C. 3507(d)), the Department of Education has submitted copies of
these sections to
[[Page 27156]]
the Office of Management and Budget (OMB) for its review.
Collection of Information: State-Administered Programs--Allocation of
Funds to Charter Schools
These regulations would affect charter schools, LEAs, and SEAs (and
other State agencies that administer covered programs). SEAs and LEAs
will need and use the information to determine whether a charter school
is eligible to receive funds under a covered program, to estimate the
amount of funds the charter school is eligible to receive, and to
ensure that the charter school receives that amount.
The Department estimates that SEAs will incur approximately 48.5
burden hours in the first year, and approximately 30.5 burden hours in
subsequent years. The Department estimates the annual burden for
charter schools and LEAs to be approximately 2.5 hours. The total
annual reporting and recordkeeping burden for charter schools, SEAs,
and LEAs after the first year will be determined by the number of
eligible charter schools that open or significantly expand their
enrollment each academic year.
If you want to comment on the information collection requirements,
please send your comments to the Office of Information and Regulatory
Affairs, OMB, room 10235, New Executive Office Building, Washington, DC
20503; Attention: Desk Officer for U.S. Department of Education. You
may also send a copy of these comments to the Department representative
named in the ADDRESSES section of this preamble.
We consider your comments on these proposed collections of
information in--
Deciding whether the proposed collections are necessary
for the proper performance of our functions, including whether the
information will have practical use;
Evaluating the accuracy of our estimate of the burden
of the proposed collections, including the validity of our
methodology and assumptions;
Enhancing the quality, usefulness, and clarity of the
information we collect; and
Minimizing the burden on those who must respond. This
includes exploring the use of appropriate automated, electronic,
mechanical, or other technological collection techniques or other
forms of information technology; e.g., permitting electronic
submission of responses.
OMB is required to make a decision concerning the collections of
information contained in these proposed regulations between 30 and 60
days after publication of this document in the Federal Register.
Therefore, to ensure that OMB gives your comments full consideration,
it is important that OMB receives the comments within 30 days of
publication. This does not affect the deadline for your comments to us
on the proposed regulations.
Intergovernmental Review
Some of the programs that would be affected by these regulations
are subject to the requirements of Executive Order 12372 and the
regulations in 34 CFR Part 79. The objective of the Executive order is
to foster an intergovernmental partnership and a strengthened
federalism by relying on processes developed by State and local
governments for coordination and review of proposed Federal financial
assistance.
In accordance with the order, this document is intended to provide
early notification of the Department's specific plans and actions for
these programs.
Assessment of Educational Impact
The Secretary particularly requests comments on whether these
proposed regulations would require transmission of information that any
other agency or authority of the United States gathers or makes
available.
Electronic Access to This Document
You may view this document, as well as all other Department of
Education documents published in the Federal Register, in text or Adobe
Portable Document Format (PDF) on the Internet at either of the
following sites:
http://ocfo.ed.gov/fedreg.htm
http://www.ed.gov/news.html
To use the PDF you must have the Adobe Acrobat Reader Program with
Search, which is available free at either of the previous sites. If you
have questions about using the PDF, call the U.S. Government Printing
Office (GPO), toll free, at 1-888-293-6498; or in the Washington, DC
area at (202) 512-1530.
Note: The official version of this document is the document
published in the Federal Register. Free Internet access to the
official edition of the Federal Register and the Code of Federal
Regulations is available on GPO Access at: http://
www.access.gpo.gov/nara/index.html.
(Catalog of Federal Domestic Assistance Number does not apply)
List of Subjects in 34 CFR Part 76
Administrative practice and procedure, Compliance, Eligibility,
Grant administration, Reporting and recordkeeping requirements.
Dated: May 12, 1999.
Richard W. Riley,
Secretary of Education.
The Secretary proposes to amend part 76 of title 34 of the Code of
Federal Regulations as follows:
PART 76--STATE-ADMINISTERED PROGRAMS
1. The authority citation for part 76 is revised to read as
follows:
Authority: 20 U.S.C. 1221e-3, 3474, 6511(a), and 8065a, unless
otherwise noted.
2. Subpart H of part 76 is redesignated as subpart I.
3. A new subpart H is added to part 76 to read as follows:
Subpart H--Allocation of Funds to Charter Schools
General
Sec.
76.785 What is the purpose of this subpart?
76.786 What entities are governed by this subpart?
76.787 What definitions apply to this subpart?
Responsibilities for Notice and Information
76.788 What are a charter school LEA's responsibilities under this
subpart?
76.789 What are an SEA's responsibilities under this subpart?
Allocation of Funds by State Educational Agencies
76.790 Under what circumstances must an SEA comply with the
requirements of this subpart?
76.791 On what basis does an SEA determine whether a charter school
LEA that opens or significantly expands its enrollment is eligible
to receive funds under a covered program?
76.792 How does an SEA allocate funds to eligible charter school
LEAs under a covered program in which the SEA awards subgrants on a
formula basis?
76.793 When is an SEA required to allocate funds to a charter
school LEA under this subpart?
76.794 How does an SEA allocate funds to charter school LEAs under
a covered program in which the SEA awards subgrants on a
discretionary basis?
Adjustments
76.796 What are the consequences of an SEA allocating more or fewer
funds to a charter school LEA under a covered program than the
amount for which the charter school LEA is eligible when the charter
school LEA actually opens or significantly expands its enrollment?
76.797 When is an SEA required to make adjustments to allocations
under this subpart?
Applicability of This Subpart to Local Educational Agencies
76.799 Do the requirements in this subpart apply to LEAs?
[[Page 27157]]
Subpart H--Allocation of Funds to Charter Schools
General
Sec. 76.785 What is the purpose of this subpart?
The regulations in this subpart implement section 10306 of the
Elementary and Secondary Education Act of 1965 (ESEA), which requires
States to take measures to ensure that each charter school in the State
receives the funds under a covered program for which the charter school
is eligible during its first year of operation and during subsequent
years in which the charter school expands its enrollment.
(Authority: 20 U.S.C. 8065a)
Sec. 76.786 What entities are governed by this subpart?
The regulations in this subpart apply to--
(a) State educational agencies (SEAs) and local educational
agencies (LEAs) that fund charter schools under a covered program,
including SEAs and LEAs located in States that do not participate in
the United States Department of Education's (Department) Public Charter
Schools Program;
(b) State agencies that are not SEAs, if they are responsible for
administering a covered program. State agencies that are not SEAs must
comply with the provisions in this subpart that are applicable to SEAs;
and
(c) Charter schools that are scheduled to open or significantly
expand their enrollment during the academic year and wish to
participate in a covered program.
(Authority: 20 U.S.C. 8065a)
Sec. 76.787 What definitions apply to this subpart?
For purposes of this subpart--
Charter school has the same meaning as provided in title X, part C
of the ESEA.
Charter school LEA means a charter school that is treated as a
local educational agency for purposes of the applicable covered
program.
Covered program means an elementary or secondary education program
administered by the Department under which the Secretary allocates
funds to States on a formula basis.
Local educational agency has the same meaning for each covered
program as provided in the authorizing statute for the program.
(Authority: 20 U.S.C. 8065a)
Responsibilities for Notice and Information
Sec. 76.788 What are a charter school LEA's responsibilities under
this subpart?
(a) Notice. (1) At least 120 days before the date a charter school
LEA is scheduled to open or significantly expand its enrollment, the
charter school LEA must provide its SEA with written notification of
that date. (2)(i) The failure of an eligible charter school LEA to
comply with paragraph (a)(1) of this section relieves the SEA of its
obligation to comply with Sec. 76.793, unless the SEA receives actual
notice of the date the charter school LEA is scheduled to open or
significantly expand its enrollment from another source at least 120
days before that date.
(ii) An SEA that does not receive at least 120 days' actual notice
of the date an eligible charter school LEA is scheduled to open or
significantly expand its enrollment must provide funds to the charter
school LEA within a reasonable period of time after the charter school
LEA opens or significantly expands its enrollment, consistent with the
requirements of this subpart.
(b) Information. (1) In order to receive funds, a charter school
LEA must--
(i) Provide to the SEA any available data or information that the
SEA may reasonably require to assist the SEA in estimating the amount
of funds the charter school LEA may be eligible to receive under a
covered program; and
(ii) Establish its compliance with all applicable program
requirements on the same basis as other LEAs.
(2) Once a charter school LEA has opened or significantly expanded
its enrollment, the charter school LEA must provide actual enrollment
and eligibility data to the SEA at a time the SEA may reasonably
require. An SEA may withhold funds from a charter school LEA until the
charter school LEA provides the SEA with the required actual enrollment
and eligibility data.
(Authority: 20 U.S.C. 8065a)
Sec. 76.789 What are an SEA's responsibilities under this subpart?
Upon receiving notice, under Sec. 76.788(a)(1) or otherwise, of the
date a charter school LEA is scheduled to open or significantly expand
its enrollment, an SEA must provide the charter school LEA with timely
and meaningful information about each covered program in which the
charter school LEA may be eligible to participate, including notice of
any upcoming competitions under the program.
(Authority: 20 U.S.C. 8065a)
Allocation of Funds by State Educational Agencies
Sec. 76.790 Under what circumstances must an SEA comply with the
requirements of this subpart?
(a) An SEA must comply with the requirements of this subpart with
respect to any charter school LEA that--
(1) Opens for the first time or significantly expands its
enrollment during an academic year for which the State awards funds by
formula or through a competition under a covered program;
(2) Meets the eligibility requirements of the applicable covered
program; and
(3) Meets the requirements of Sec. 76.788(a).
(b) In order to meet the requirements of this subpart, an SEA may
allocate funds to, or reserve funds for, an eligible charter school LEA
based on estimates of projected enrollment at the charter school LEA on
or after the date the charter school LEA actually opens or
significantly expands its enrollment.
(Authority: 20 U.S.C. 8065a)
Sec. 76.791 On what basis does an SEA determine whether a charter
school LEA that opens or significantly expands its enrollment is
eligible to receive funds under a covered program?
(a) For purposes of this subpart, an SEA must determine whether a
charter school LEA is eligible to receive funds under a covered program
based on actual enrollment or other eligibility data for the charter
school LEA on or after the date the charter school LEA opens or
significantly expands its enrollment. For the year the charter school
LEA opens or significantly expands its enrollment, the eligibility
determination may not be based on enrollment or eligibility data from a
prior year, even if the SEA makes eligibility determinations for other
LEAs under the program based on enrollment or eligibility data from a
prior year.
(b) Except as provided in Sec. 76.788(b)(2), a charter school LEA
must receive the funds for which it is eligible in accordance with this
subpart, even if the charter school LEA opens or significantly expands
its enrollment after the date the SEA makes allocations to other LEAs
under an applicable covered program.
(Authority: 20 U.S.C. 8065a)
Sec. 76.792 How does an SEA allocate funds to eligible charter school
LEAs under a covered program in which the SEA awards subgrants on a
formula basis?
(a) For each eligible charter school LEA that is scheduled to open
or significantly expand its enrollment on or before November 1 of an
academic
[[Page 27158]]
year, the SEA must implement procedures that ensure that the charter
school LEA receives the full amount of funds for which the charter
school LEA is eligible under each covered program.
(b) For each eligible charter school LEA that is scheduled to open
or significantly expand its enrollment after November 1 but before
February 1 of an academic year, the SEA must implement procedures that
ensure that the charter school LEA receives at least a pro rata portion
of the funds for which the charter school LEA is eligible under each
covered program. The pro rata amount must be based on the number of
months during the academic year the charter school LEA will participate
in the program as compared to the total number of months in the
academic year.
(c) For each eligible charter school LEA that is scheduled to open
or significantly expand its enrollment on or after February 1 of an
academic year, the SEA may implement procedures to provide the charter
school LEA with a pro rata portion of the funds for which the charter
school LEA is eligible under each covered program.
(Authority: 20 U.S.C. 8065a)
Sec. 76.793 When is an SEA required to allocate funds to a charter
school LEA under this subpart?
Except as provided in Secs. 76.788(a)(2) and 76.788(b)(2), for
eligible charter school LEAs that open or significantly expand their
enrollment before February 1 of an academic year, the SEA must allocate
funds to the charter school LEA within five months of the date the
charter school LEA opens or significantly expands its enrollment.
(Authority: 20 U.S.C. 8065a)
Sec. 76.794 How does an SEA award funds to charter school LEAs under a
covered program in which the SEA awards subgrants on a discretionary
basis?
(a) Competitive programs. (1) For covered programs in which the SEA
awards subgrants on a competitive basis, the SEA must provide each
eligible charter school LEA in the State that is scheduled to open on
or before the closing date of any competition under the program a full
and fair opportunity to apply to participate in the program.
(2) An SEA is not required to delay the competitive process in
order to allow a charter school LEA that has not yet opened or
significantly expanded its enrollment to compete for funds under a
covered program.
(b) Noncompetitive discretionary programs. The requirements in this
subpart do not apply to discretionary covered programs under which the
SEA does not award subgrants through a competition.
(Authority: 20 U.S.C. 8065a)
Adjustments
Sec. 76.796 What are the consequences of an SEA allocating more or
fewer funds to a charter school LEA under a covered program than the
amount for which the charter school LEA is eligible when the charter
school LEA actually opens or significantly expands its enrollment?
(a) An SEA that allocates more or fewer funds to a charter school
LEA than the amount for which the charter school LEA is eligible, based
on actual enrollment or eligibility data when the charter school LEA
opens or significantly expands its enrollment, must make appropriate
adjustments to the amount of funds allocated to the charter school LEA
as well as to other LEAs under the applicable program.
(b) Any adjustments to allocations to charter school LEAs under
this subpart must be based on actual enrollment or other eligibility
data for the charter school LEA on or after the date the charter school
LEA first opens or significantly expands its enrollment, even if
allocations or adjustments to allocations to other LEAs in the State
are based on enrollment or eligibility data from a prior year.
(Authority: 20 U.S.C. 8065a)
Sec. 76.797 When is an SEA required to make adjustments to allocations
under this subpart?
The SEA must make any necessary adjustments to allocations under a
covered program on or before the date the SEA allocates funds to LEAs
under the program for the succeeding academic year.
(Authority: 20 U.S.C. 8065a)
Applicability of This Subpart to Local Educational Agencies
Sec. 76.799 Do the requirements in this subpart apply to LEAs?
(a) Each LEA that is responsible for funding a charter school under
a covered program must comply with the requirements in this subpart on
the same basis as SEAs are required to comply with the requirements in
this subpart.
(b) In applying the requirements in this subpart (except for
Secs. 76.785, 76.786, and 76.787) to LEAs, references to SEA (and State
in Secs. 76.794(a) and 76.796(b)), charter school LEA, and LEA must be
read as references to LEA, charter school, and public school,
respectively.
(Authority: 20 U.S.C. 8065a)
[FR Doc. 99-12456 Filed 5-17-99; 8:45 am]
BILLING CODE 4000-01-U
