[Federal Register Volume 59, Number 146 (Monday, August 1, 1994)]
[Unknown Section]
[Page 0]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-18616]
[[Page Unknown]]
[Federal Register: August 1, 1994]
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Part VI
Department of Education
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Missouri Department of Elementary and Secondary Education; Notice of
Intent To Award Grantback Funds
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DEPARTMENT OF EDUCATION
Intent to Repay to the Missouri Department of Elementary and
Secondary Education Funds Recovered as a Result of a Final Audit
Determination
AGENCY: Department of Education.
ACTION: Notice of intent to award grantback funds.
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SUMMARY: Notice is given that under section 456 of the General
Education Provisions Act (GEPA), 20 U.S.C. 1234e (1982), the U.S.
Secretary of Education (Secretary) intends to repay to the Missouri
Department of Elementary and Secondary Education, the State educational
agency (SEA or Missouri), an amount nearly equal to 75 percent of the
principal amount of funds recovered by the U.S. Department of Education
(Department) as a result of a final audit determination. This notice
describes the SEA's plan for the use of the repaid funds and the terms
and conditions under which the Secretary intends to make those funds
available. The notice invites comments on the proposed grantback.
DATES: All comments must be received on or before August 31, 1994.
ADDRESSES: Comments concerning the grantback should be addressed to
William D. Tyrrell, Sr., U.S. Department of Education, 400 Maryland
Avenue, S.W., room 3609, Switzer Building, Washington, D.C. 20202-6132.
FOR FURTHER INFORMATION CONTACT: William D. Tyrrell, Sr., U.S.
Department of Education, 400 Maryland Avenue, S.W., room 3609, Switzer
Building, Washington, D.C. 20202-6132, telephone: (202) 205-8825.
Individuals who use a telecommunications device for the deaf (TDD) may
call the Federal Information Relay Service (FIRS) at 1-877-8339 between
8 a.m. and 8 p.m., Eastern time, Monday through Friday.
SUPPLEMENTARY INFORMATION:
A. Background
This notice is based on the Department's recovery of funds
following an audit report prepared by the United States Department of
Education's Office of Inspector General, Office of Audit, Region VII,
issued on May 29, 1984, of the Special School District of St. Louis
County's (SSD) administration of its Part B of the Education of the
Handicapped Act1 (Part B) grant award for the funding period of
July 1, 1977 through June 30, 1983. (Audit Control Number: 07-30032).
Among the objectives of that audit was to determine whether SSD
complied with Part B's non-supplanting requirement. Under that
requirement, a local educational agency (LEA) receiving Part B funds
must, in any particular fiscal year, spend as much State and local
funds on special education and related services, on either an aggregate
or per capita basis, as it did in the prior fiscal year. This part of
the non-supplanting requirement is referred to as the ``aggregate
expenditure'' test.
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\1\In 1990, the name of this Act was changed by Congress to Part
B of the Individuals with Disabilities Education Act. See Pub. L.
101-476.
(See 20 U.S.C. 1414(a)(2)(B)(ii) and (f) (1982) and 34 CFR Sec. 300.230
(1982)). 34 CFR 300.230 also prohibited, during the period at issue,
the use of Part B funds to pay for specific costs that had been
previously paid for with State and local funds. This part of the non-
supplanting requirement is referred to as the ``particular cost'' test.
Id.2
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\2\ The particular cost requirement was removed from the Part B
regulations in 1992. See 57 F.R. 37652 (August 19, 1992).
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On April 17, 1986, the Assistant Secretary for Special Education
and Rehabilitative Services (Assistant Secretary) issued a final letter
of determination (FLD) to the SEA that adopted the finding of the audit
report and disallowed $1,374,880 of fiscal year 1980, 1981, and 1983
Part B funds expended in violation of the non-supplanting
requirement.3 Most of these funds, $929,746, were disallowed
because of SSD's failure to comply with the aggregate expenditure test.
The FLD, however, also disallowed $445,116 because of SSD's failure to
comply with the particular cost test.
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\3\ Under Part B, the SEA is responsible for assuring that the
funds it receives and awards to its school districts will be spent
in accordance with, among other things, the Act's non-supplanting
requirement. (See 20 U.S.C. 1413(a)(1) (1982). See also 20 U.S.C.
1412(6) (1982)). Thus, although SSD violated the non-supplanting
requirement, the Department sought recovery of the misexpended funds
from the SEA.
The FLD also disallowed $107,969 of fiscal year 1983 funds
because of erroneous reporting and improper charges to the Part B
program. This claim was subsequently withdrawn on the basis of
evidence presented by SSD to the Assistant Secretary after the FLD
was issued.
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On May 16, 1986, Missouri filed an application for review of the
FLD with the Education Appeal Board (EAB).4 The SEA's application
for review and the petition to intervene in the proceedings filed by
SSD were accepted by the EAB. During the course of proceedings before
the EAB, the Assistant Secretary, on the basis of documentation
presented by SSD, reduced the claim made in the FLD for funds spent in
violation of the non-supplanting requirement to $911,153. The EAB's
Initial Decision, which was issued on August 9, 1989, held that
Missouri must refund $463,729 to the Department.
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\4\ The procedures for appealing FLDs issued by officials of the
Department of Education were changed by Pub. L. 100-297 (April 28,
1988). 20 U.S.C. Secs. 1234 and 1234a (1988). The Department's
Office of Administrative Law Judges now performs the duties related
to the adjudication of appeals of FLDs that were previously assigned
to the EAB.
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The SEA, SSD, and the Secretary of Education entered into a
settlement agreement that resolved the issues in the appeal on May 22,
1991. On June 17, 1991, pursuant to the terms of that agreement, SSD
returned $223,500 to the Department. The EAB, on the basis of a Joint
Motion filed by all the parties, dismissed the appeal with prejudice.
All terms of the settlement agreement have been satisfied.
B. Authority for Awarding a Grantback
Section 456(a) of GEPA, 20 U.S.C. 1234e(a)(1982), provides that
whenever the Secretary has recovered funds following a final audit
determination with respect to an applicable program, the Secretary may
consider those funds to be additional funds available for the program
and may arrange to repay to the SEA or LEA affected by the
determination an amount not to exceed 75 percent of the recovered
funds. The Secretary may enter into this ``grantback'' arrangement if
the Secretary determines that the--
(a) Practices and procedures of the SEA or LEA that resulted in the
audit determination have been corrected, and the SEA or LEA is, in all
other respects, in compliance with the requirements of the applicable
program;
(b) The SEA has submitted to the Secretary a plan for the use of
the funds to be awarded under the grantback arrangement that meets the
requirements of the program and, to the extent possible, benefits the
population that was affected by the failure to comply or by the
misexpenditures that resulted in the audit exception; and
(c) Use of funds to be awarded under the grantback arrangement in
accordance with the SEA's plan would serve to achieve the purposes of
the program under which the funds were originally granted.
C. Plan for Use of Funds Awarded Under a Grantback Arrangement
Pursuant to section 456(a)(2) of GEPA, the SEA has applied for a
grantback totaling $167,585, which is slightly less than 75 percent of
the principal amount of the recovered funds, and has submitted a plan
for use of the grantback funds to meet the special education needs of
children with disabilities. Under section 456(c) of GEPA, 20 U.S.C.
1234e(c)(1982), these funds are available for expenditure until
September 30, 1994. The SSD's plan, which has been submitted by the
SEA, is to train its personnel in a transdisciplinary team approach to
serving children with disabilities. The training has five major
components: (1) initial training on the transdisciplinary team approach
of providing services to students with disabilities; (2) concept
support training, including Project RIDE (Responding to Individual
Differences in Education), the nationally recognized program for at-
risk students aimed at helping students who have difficulty functioning
successfully in the regular classroom; (3) monthly site-based meetings;
(4) consultation with recognized experts and trainers; and (5)
evaluation to continue modification of the process as appropriate and
planning to continue implementation district-wide. The training will be
provided to 18 teams on the concept of transdisciplinary service and
the process of working as a team. Each team will be composed of one
general education teacher, one general education counselor, two special
education teachers, one speech/language pathologist, and one special
education area coordinator. Approximately ten occupational/physical
therapists, serving multiple teams, will also be included. These teams
will benefit from the initial two-day training workshop which focuses
on the transdisciplinary approach. In addition, there will be
supplemental training: follow-up sessions, one mid-way in the project
and one near the end of the project period. The teams will also be
participating in the monthly meeting guided by the local Project
Leader.
D. The Secretary's Determinations
The Secretary has carefully reviewed the plan submitted by the SEA.
Based upon that review, the Secretary has determined that the
conditions under section 456 of GEPA have been met.
These determinations are based upon the best information available
to the Secretary at the present time. If this information is not
accurate or complete, the Secretary is not precluded from taking
appropriate administrative action. In finding that the conditions of
section 456 of GEPA have been met, the Secretary makes no determination
concerning any pending audit recommendations or final audit
determinations.
E. Notice of the Secretary's Intent To Enter Into a Grantback
Arrangement
Section 456(d) of GEPA requires that, at least 30 days before
entering into an arrangement to award funds under a grantback, the
Secretary must publish in the Federal Register a notice of intent to do
so, and the terms and conditions under which the payment will be made.
In accordance with section 456(d) of GEPA, notice is hereby given
that the Secretary intends to make funds available to Missouri under a
grantback arrangement. The grantback award would be in the amount of
$167,585, which is approximately 75 percent--the maximum percentage
authorized by statute--of the principal amount recovered as a result of
the audit.
F. Terms and Conditions Under Which Payments Under a Grantback
Arrangement Would Be Made
The SEA agrees to comply with the following terms and conditions
under which payments under a grantback arrangement would be made:
(a) The funds awarded under the grantback must be spent in
accordance with--
(1) All applicable statutory and regulatory requirements;
(2) The plan that the SEA submitted and any amendments to the plan
that are approved in advance by the Secretary; and
(3) The budget that was submitted with the plan and any amendments
to the budget that are approved in advance by the Secretary.
(b) All funds received under the grantback arrangement must be
obligated by September 30, 1994, in accordance with section 456(c) of
GEPA;
(c) The SEA will, not later than January 1, 1995, submit a report
to the Secretary that--
(1) Indicates that the funds awarded under the grantback have been
spent in accordance with the proposed plan and approved; and
(2) Describes the results and effectiveness of the project for
which the funds were spent.
(d) Separate accounting records must be maintained documenting the
expenditures of funds awarded under the grantback arrangement.
(e) Before funds will be repaid pursuant to this notice, the SEA
must repay to the Department any debts that become overdue, or enter
into a repayment agreement for those debts.
Dated: July 26, 1994.
Judith E. Heumann,
Assistant Secretary for Special Education and Rehabilitative Services.
(Catalog of Federal Domestic Assistance Number 84.027, Handicapped
State Grants)
[FR Doc. 94-18616 Filed 7-29-94; 8:45 am]
BILLING CODE 4000-01-P
