[Federal Register Volume 60, Number 212 (Thursday, November 2, 1995)]
[Rules and Regulations]
[Pages 55758-55772]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-27169]
[[Page 55757]]
_______________________________________________________________________
Part II
Department of Education
_______________________________________________________________________
34 CFR Part 370
Special Education and Rehabilitative Services; Client Assistance
Program; Final Rule
Federal Register / Vol. 60, No. 212 / Thursday, November 2, 1995 /
Rules and Regulations
[[Page 55758]]
DEPARTMENT OF EDUCATION
34 CFR Part 370
RIN 1820-AB16
Client Assistance Program
AGENCY: Department of Education.
ACTION: Final regulations.
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SUMMARY: The Secretary amends the regulations governing the Client
Assistance Program (CAP) to implement changes to the Rehabilitation Act
of 1973 (Act) made by the Rehabilitation Act Amendments of 1992 (1992
Amendments), enacted on October 29, 1992, and the Rehabilitation Act
Amendments of 1993 (1993 Amendments), enacted on August 11, 1993.
EFFECTIVE DATE: These regulations take effect December 4, 1995.
FOR FURTHER INFORMATION CONTACT: David Ziskind, U.S. Department of
Education, 600 Independence Avenue SW., Room 3211, Switzer Building,
Washington, DC 20202-2735. Telephone: (202) 205-5474. Individuals who
use a telecommunications device for the deaf (TDD) may call the TDD
number at (202) 205-9362 between 8 a.m. and 8 p.m., Eastern time,
Monday through Friday.
SUPPLEMENTARY INFORMATION: The CAP is authorized by section 112 of the
Act (29 U.S.C. 732). The CAP provides support to States for programs
that assist clients and client applicants to secure the benefits and
services available to them under the Act.
The final regulations implement changes to section 112 of the Act
made by the 1992 and 1993 Amendments (Pub. L. 102-569 and Pub. L. 103-
73, respectively), clarify certain program requirements, and make other
changes that are needed to increase program effectiveness. More
specifically, the final regulations describe the process a Governor is
required to use to designate a public or private agency to conduct the
CAP authorized by section 112 of the Act (i.e., the designated agency),
identify the authorized activities a designated agency is required to
carry out under the CAP, and specify the conditions that apply to a
State and the designated agency in the operation of its CAP. The final
regulations implement the requirement in the 1992 Amendments that CAPs
expand the services they provide to include dissemination of
information related to Title I of the Americans with Disabilities Act
of 1990 (ADA), especially with regard to individuals with disabilities
who have traditionally been unserved or underserved by vocational
rehabilitation (VR) programs. The final regulations implement the due
process requirements added by the 1992 Amendments that apply if a
Governor of a State chooses to redesignate the agency designated to
conduct the State's CAP. Finally, the final regulations incorporate
certain provisions of the Education Department General Administrative
Regulations (EDGAR).
This program supports the National Education Goal that, by the year
2000, every adult American, including individuals with disabilities,
will possess the knowledge and skills necessary to compete in a global
economy and exercise the rights and responsibilities of citizenship.
On October 8, 1993, the Secretary published a notice of proposed
rulemaking (NPRM) for this program in the Federal Register (58 FR
52614). The major issues related to this program were discussed in the
preamble to the NPRM. In general, the commenters agreed with the NPRM.
Analysis of Comments and Changes
In response to the Secretary's invitation in the NPRM, 90 parties
submitted comments on the proposed regulations. An analysis follows of
the comments and of the changes in the regulations since publication of
the NPRM, including those changes made as a result of the Secretary's
further consideration of certain issues for the purpose of reducing
burden and increasing flexibility.
The comments have been grouped according to subject, with
appropriate sections of the regulations referenced in parentheses.
Technical and other minor changes--and suggested changes the Secretary
is not legally authorized to make under the applicable statutory
authority--are not addressed.
Purpose (Sec. 370.1(b))
Comments: One commenter recommended changing the term
``facilities'' in proposed Sec. 370.1(b) to ``community rehabilitation
programs'' to correspond to changes in the statutory language made by
the 1993 Amendments. Several other commenters recommended that the same
change be made in proposed Sec. 370.4(a)(2).
Discussion: The Secretary agrees that the term ``facilities''
should be changed to correspond to the change in terminology made by
the 1993 Amendments to section 112(a) of the Act.
Changes: The Secretary has changed the terms ``facility'' and
``facilities'' to ``community rehabilitation program'' and ``community
rehabilitation programs,'' as appropriate, in Secs. 370.1(b),
370.4(a)(3), 370.41(a)(1), and 370.42 in the final regulations.
Eligible Subgrantees (Sec. 370.2(e))
Comments: The Secretary received 77 comments objecting to proposed
Sec. 370.2(e), which prohibits a designated agency from contracting
with an entity or individual to provide CAP services if that entity or
individual provides services under the Act. Of these 77 commenters, 41
were letters from individuals who had received Client Assistance
Program (CAP) services from centers for independent living (centers) in
one State, 13 were from centers in that one State, and 14 were from
other organizations and agencies in that one State. These commenters
believed that centers should be allowed to contract with a designated
agency, even though centers provide services under the Act, for a
variety of reasons, including the following: housing CAP services in
centers is convenient, cost-effective, and promotes maximum access to
services for consumers; centers are different from other service
providers because a major function of centers is to advocate and to
teach individuals how to advocate for themselves; the Rehabilitation
Services Administration (RSA) previously approved contracts between a
designated agency and centers to provide CAP services in a State; and
the prohibition on contracting with service providers in proposed
Sec. 370.2(e) has no statutory basis.
Discussion: The Secretary agrees that many clients and client
applicants have been served well by centers under contract with a
designated agency to provide CAP services. The Secretary also
recognizes that one of the major functions of a center is to provide
advocacy on behalf of individuals with severe disabilities and that
this function distinguishes a center from other providers of services
under the Act.
Furthermore, the Secretary acknowledges that, several years ago,
RSA advised a designated agency that it was permissible to maintain its
contracts with centers. RSA's decision was based on language in section
112(c)(1)(A) of the Act that provides an exemption from the requirement
(in that same section of the Act) that a Governor of a State designate
as the designated agency an agency that is independent of any agency
that provides treatment, services, or rehabilitation to individuals
under the Act. This statutory exemption from the ``independence''
requirement in section 112(c)(1)(A) of the Act permits a Governor of a
State to designate, in the initial designation (i.e., the first
designation by the Governor,
[[Page 55759]]
after February 22, 1984, of an agency to carry out the CAP), an agency
that provides treatment, services, or rehabilitation to individuals
with disabilities under the Act if, at any time prior to February 22,
1984, there had been an agency in the State that had both served as a
designated agency and received Federal financial assistance under the
Act. Because the centers in question were continuing to carry out the
CAP after February 22, 1984, under contracts entered into prior to
February 22, 1984, with an agency that had been designated as the
State's CAP agency prior to February 22, 1984, RSA permitted the agency
designated as the State's CAP agency after February 22, 1984, to
continue contracting with centers to provide CAP services. Section
370.2(f) of the final regulations implements this very limited
exemption to the independence requirement.
However, the Secretary also believes that, notwithstanding the
limited exception for certain contracts with centers, retaining the
general prohibition in Sec. 370.2(e) against designated agencies
contracting with service providers is in the best interest of the CAP
and is consistent with the independence requirement of section
112(c)(1)(A) of the Act. Therefore, the Secretary is strictly limiting
this exemption from the independence requirement to the circumstances
that formed the basis for RSA's earlier decision to permit a designated
agency to contract with centers to provide CAP services.
In addition, pursuant to new Sec. 370.2(g)(1) of the final
regulations, the designated agency remains legally responsible for the
conduct of a CAP that meets all of the requirements of 34 CFR Part 370.
Also, pursuant to new Sec. 370.2(g)(2) of the final regulations, the
designated agency remains legally responsible for the proper
expenditure of CAP funds and shall exercise proper management of its
contract to ensure that CAP funds are used in compliance with the
regulations in this part and with the cost principles applicable to the
designated agency. Furthermore, new Sec. 370.2(g)(3) of the final
regulations requires a designated agency that contracts to carry out
the CAP to be directly involved in the day-to-day supervision of the
CAP services being carried out by the contractor. This day-to-day
supervision must include the direct supervision by designated agency
staff of the contractor's employees who are responsible for providing
CAP services.
Finally, the Secretary wishes to emphasize that the conflict of
interest provisions in Sec. 370.41 (b) and (c) apply if a designated
agency contracts to carry out CAP services.
Changes: The Secretary has added a new paragraph Sec. 370.2(f) that
will allow a designated agency in a State to enter into a contract for
CAP services with a center that provides treatment, services, or
rehabilitation to individuals with disabilities under the Act if, on
February 22, 1984, a designated agency in the State was contracting
with one or more centers to provide CAP services. The Secretary also
has added a new Sec. 370.2(g) to the final regulations to reflect the
conditions and responsibilities that relate to this limited contracting
authority.
Eligibility for Services (Sec. 370.3)
Comments: One commenter recommended revising proposed Sec. 370.3 to
clarify that all individuals with disabilities seeking information
about their employment rights under Title I of the ADA, 42 U.S.C.
12101-12213, may receive that information from the designated agency.
Discussion: The Secretary agrees Sec. 370.3 should reflect the
revisions to section 112 of the Act made by the 1992 Amendments that
authorize the designated agency to provide information to individuals
with disabilities, especially those who have traditionally been
unserved or underserved by VR programs, about the services and benefits
authorized under Title I of the ADA.
Changes: The Secretary has revised Sec. 370.3 in the final
regulations to clarify that all individuals with disabilities are
eligible to receive information on the services and benefits available
to them under Title I of the ADA. In addition, the Secretary has added
a new Sec. 370.3(b) to the final regulations to clarify that only
clients and client applicants are eligible for CAP services.
Comments: One commenter asked why proposed Sec. 370.3 excludes
services under the Protection and Advocacy of Individual Rights (PAIR)
program from the types of services provided under the Act that qualify
an individual to receive CAP services.
Discussion: Receipt of services under the PAIR program authorized
by section 509 of the Act does not entitle an individual to CAP
services for several reasons. Both the PAIR program and CAP are
programs that provide primarily advocacy services for individuals with
disabilities. In addition, the PAIR program provides advocacy services
with respect to other rights and benefits provided to individuals with
disabilities under other Federal and State statutes.
The phrase ``services under the Act'' in section 112 of the Act was
intended to include only direct VR, independent living, supported
employment, and other similar rehabilitation services under the Act and
was never intended to include the advocacy services provided under the
PAIR program. Neither the CAP nor the PAIR program provides direct
``rehabilitation services,'' as that term is traditionally defined, to
individuals with disabilities. Therefore, an individual with a
disability who applies for or is receiving advocacy services under the
PAIR program and is either denied PAIR services or is dissatisfied with
PAIR services is not eligible to seek advocacy services under the CAP
from the designated agency to address any grievance with the PAIR
agency.
Changes: None. However, in response to this comment on proposed
Sec. 370.3, the Secretary has added a definition to Sec. 370.6(b) in
the final regulations for the term ``services under the Act'' that
excludes PAIR services.
Authorized Activities (Sec. 370.4)
Comments: One commenter suggested that proposed Sec. 370.4(a)(1)(i)
be revised to prohibit a designated agency from providing advocacy
services to clients whose grievances involve services and benefits
available under Title I of the ADA. Two commenters suggested that a
designated agency should be permitted to advocate for the individual's
rights under Title I of the ADA. Two other commenters stated that
proposed Sec. 370.4(b) is confusing and suggested that this provision
be reworded.
Discussion: An individual who needs or is seeking assistance and
advocacy services to assert his or her rights under Title I of the ADA
and who is also a client or client applicant under the Act may receive
advocacy services from the designated agency with respect to his or her
claims under Title I of the ADA, if the assistance and advocacy under
Title I of the ADA are directly related to services that the client or
client applicant is seeking or receiving under the Act. Example: Under
an individual written rehabilitation program developed pursuant to
Title I of the Act, a State VR agency is assisting a client who must
use a wheelchair to obtain employment with Employer Y. However,
Employer Y refuses to make the company's entrance accessible to
wheelchairs. A designated agency would be able to undertake advocacy
under Title I of the ADA on behalf of that client to argue that
Employer Y is required to make the company's entrance accessible to
wheelchairs.
[[Page 55760]]
Nothing in the revisions made to section 112 of the Act or in the
legislative history of those revisions indicates that a designated
agency may advocate for an individual whose grievances involve only
rights, services, and benefits available under Title I of the ADA, but
whose grievances are not related to services under the Act. However,
the Secretary does wish to point out that an individual whose
grievances involve only rights, services, and benefits available under
Title I of the ADA may be eligible to obtain advocacy services to
pursue those rights, services, and benefits from an eligible agency
under the PAIR program.
Changes: The Secretary has revised Sec. 370.4 (a) and (b) in the
final regulations to clarify that the designated agency may provide
assistance and advocacy services to a client or client applicant with
respect to the individual's claims under Title I of the ADA, if those
claims under Title I of the ADA are directly related to services under
the Act that the individual is receiving or seeking.
Comments: Several commenters suggested that proposed
Sec. 370.4(a)(2) be revised to give the designated agency discretion to
deny an individual's request for advocacy services if the individual's
case is without merit.
Discussion: Nothing in the Act or these regulations either requires
the designated agency to accept frivolous cases on behalf of
individuals or takes away a designated agency's discretion to deny an
individual's request for advocacy services if the designated agency
determines that an individual's complaint has no merit. Therefore, the
Secretary does not believe a change is necessary. However, a designated
agency must accept all meritorious requests for advocacy services to
the extent that resources are available.
Changes: None.
Comments: Three commenters suggested changing the word ``exiting''
to ``transitioning'' in proposed Sec. 370.4(a)(2)(ii) to reflect the
Act's requirement that State VR and educational agencies work together
to provide transitional services for students with disabilities leaving
secondary school programs.
Discussion: The Secretary agrees that referring to an individual's
``transition'' from public school programs to services under the Act is
more appropriate and more accurately reflects the requirements in
sections 101(a)(24) and 103(a)(14) of the Act that State VR agencies
work with education officials to plan for and provide ``transitional''
services to students with disabilities leaving public school programs.
Changes: The Secretary has replaced the word ``exiting'' with the
phrase ``making the transition from'' in Sec. 370.4(a)(3)(ii) in the
final regulations.
[Note: Proposed Sec. 370.4(a)(2)(ii) has been redesignated
Sec. 370.4(a)(3)(ii) in the final regulations.]
Definitions (Sec. 370.6(b))
Advocacy
Comments: One commenter felt that the proposed term ``systemic
advocacy'' should be more clearly defined.
Discussion: The Secretary believes that the definition of ``systems
(or systemic) advocacy'' in Sec. 370.6(b) is adequate.
Changes: None.
Comments: One commenter recommended revising the proposed
definition of advocacy because non-lawyer staff in the designated
agency typically represent clients at formal administrative hearings
conducted by State VR agencies.
Discussion: The Secretary acknowledges that some State agencies
permit non-lawyers, as well as lawyers, to represent individuals in
formal administrative proceedings, as well as in informal
administrative proceedings. The definition of advocacy in Sec. 370.6(b)
in the final regulations is not intended to supersede applicable State
law or State agency rules that may permit non-lawyers, as well as
lawyers, to engage in advocacy on behalf of another individual. Because
the definition of ``advocacy'' in the final regulations does not
preclude non-lawyers from representing clients or client applicants if
State law or State agency rules permit, the Secretary does not believe
any revision is necessary to allow this practice.
Changes: None.
Class Action
Comments: One commenter stated that the proposed definition of
``class action'' was unnecessary because the term is defined in the
Federal Rules of Civil Procedure (FRCP).
Discussion: The Secretary acknowledges that FRCP prescribes the
requirements for class actions in the courts of the United States.
These or similar rules establishing requirements for class actions have
been adopted by many States. However, to help distinguish between the
terms ``class action'' and ``systemic advocacy'' as used in these
regulations, the Secretary believes the definition of ``class action''
should be clarified.
For purposes of the CAP, engaging in ``systems (or systemic)
advocacy'' on behalf of a group or class of individuals is permissible,
if the ``systems (or systemic) advocacy'' does not include filing a
formal ``class action,'' which is specifically prohibited by section
112(d) of the Act, in a Federal or State court.
Changes: The Secretary has added language to the definition of
``class action'' in Sec. 370.6(b) in the final regulations that
excludes ``systemic advocacy,'' if the ``systems (or systemic)
advocacy'' does not include filing a formal ``class action'' in a
Federal or State court.
Client or Client Applicant
Comments: Eight commenters noted that it was unclear whether the
proposed definition of the terms ``client'' and ``client applicant''
apply to the designated agency's clients and client applicants or to
clients and client applicants under the Act. Several of these
commenters also observed that excluding from the proposed definition of
``client or client applicant'' those individuals who receive only
information and referral services adds to the confusion.
Discussion: The Secretary agrees that these regulations should
clarify that the terms ``client'' and ``client applicant'' refer only
to those individuals who are receiving or seeking services under the
Act, respectively.
Changes: The Secretary has revised the definition of ``client or
client applicant'' in Sec. 370.6(b) in the final regulations to clarify
that these terms refer only to individuals who are receiving or seeking
services under the Act, respectively.
Mediation
Comments: Some commenters objected to the requirement, included in
the proposed definition of mediation, that a designated agency shall
obtain the services of an independent third party if the designated
agency chooses to use mediation to resolve a dispute between a client
or client applicant and a service provider. These commenters objected
because the proposed requirement is contrary to the current practice at
a number of CAPs and obtaining the services of third party mediators
would be costly and burdensome.
Discussion: The Secretary recognizes that hiring independent third
parties to act as mediators would be more expensive than using in-house
staff who have been trained in the art of mediation, which is the
current practice at many designated agencies and which was permitted by
the former CAP regulations. Therefore, the Secretary believes that a
designated agency should be allowed to continue using its employees as
mediators in those cases
[[Page 55761]]
in which the designated agency relies on mediation to resolve a dispute
between a client or client applicant and a service provider. However,
if a designated agency uses any of its employees as mediators, an
individual employee of the designated agency may not assume, at one
point in time, the role of advocate for a client or client applicant
and, at another point in time, the role of a mediator in the same or
other dispute involving that client or client applicant.
In addition, if a designated agency does not use one of its own
employees as a mediator, it shall use a professional mediator or other
independent third party mutually agreed to by the parties to the
dispute. As a practical matter, allowing a designated agency to assign
one of its employees to act as a mediator in a dispute between a client
or client applicant and a service provider means that the designated
agency will have to assign another employee to act as an advocate for
the client or client applicant in that dispute. Otherwise, the
existence of the conflict of interest that will arise from the same
employee acting as both an advocate and the mediator will prevent the
designated agency from fulfilling its statutory mandate to provide
advocacy services for the client or client applicant.
Although the definition of ``mediation'' in the final regulations
does not include an exemption for an employee of a designated agency to
act as a mediator, the Secretary believes that this exemption is better
placed in Sec. 370.43 of the final regulations. The Secretary also
believes the definition of ``mediation'' for the CAP should be
consistent with the definition of ``mediation'' found in the final PAIR
regulations (34 CFR 381.5(b)).
Changes: The Secretary has revised the definition of ``mediation''
in Sec. 370.6(b) in the final regulations to be consistent with the
definition of ``mediation'' in the regulations published for the PAIR
program. The Secretary also has added language to Sec. 370.43 to permit
an employee of a designated agency to serve as a mediator as long as
that employee has not been and is not advocating on behalf of the
client or client applicant who is a party to the mediation and is not
involved in representing or assigned to represent that same client or
client applicant.
Comments: Some commenters objected to the proposed definition of
mediation because they do not believe it has a statutory basis. These
commenters also argued that a designated agency should be allowed to
listen to both sides of a dispute, conduct an investigation of the
facts, and attempt mediation before ``taking the stance of a
negotiator.'' Other commenters stated that a designated agency can
provide mediation and negotiation to resolve a client's problem. One
commenter argued that the proposed definition of mediation would force
designated agencies to always assume the position of negotiator.
Discussion: Section 112(g)(3) of the Act states, in relevant part,
as follows:
The Secretary shall prescribe regulations applicable to the
client assistance program which shall include the following
requirements:
* * * * *
(3) Each program shall contain provisions designed to assure
that to the maximum extent possible mediation procedures are used
prior to resorting to administrative or legal remedies.
29 U.S.C. 732(g)(3) (emphases added). Clearly, the Secretary has
statutory authority to define mediation by regulations and to regulate
on its use by designated agencies. In addition, the Secretary believes
that the comments received on the proposed definition of ``mediation''
indicate a misunderstanding of the difference between ``mediation'' and
``advocacy'' and a designated agency's responsibilities to clients and
client applicants.
As defined in these regulations, advocacy means to plead an
individual's cause or to speak or write in support of an individual. A
designated agency is charged under section 112(a) of the Act with
advocating the best interests of the client or client applicant,
whether those interests are advocated during negotiations, mediation,
administrative proceedings, litigation, or any other circumstances.
The role of a mediator, on the other hand, is to be an independent
third party who listens objectively to both sides of a dispute between
the client or client applicant and the service provider. A mediator is
not supposed to take sides.
Therefore, the Secretary believes that the roles of advocate and
mediator are mutually exclusive and that an individual employee of the
designated agency may not assume both roles at the same time in any
dispute involving the same client or client applicant, nor assume the
role of advocate at one point in time and the role of mediator at
another point in time in different disputes involving the same client.
The Secretary believes that allowing a designated agency to use one
of its employees as an advocate for a particular client or client
applicant and another of its employees as a mediator is consistent with
a designated agency's statutory purpose and allows a designated agency
maximum flexibility. In addition, the Secretary believes that
restricting individual employees of the designated agency to only one
of these two roles with respect to any one individual client or client
applicant provides the necessary protection to ensure that a client or
client applicant receives the advocacy to which he or she is entitled.
Changes: The same changes made in response to the previous comment
on the definition of mediation apply to this comment.
Accessibility (Sec. 370.7) (New)
Comments: One commenter suggested that the designated agency be
required to ensure that communications are provided in accessible
formats.
Discussion: The Secretary agrees that the designated agency must
provide the CAP services described in Sec. 370.4 in formats that are
accessible to clients or client applicants who seek or receive CAP
services.
Changes: The Secretary has added to the final regulations a new
Sec. 370.7 that requires a designated agency to provide CAP services in
accessible formats.
Applicability of Redesignation Requirements (Secs. 370.10 Through
370.17) to Contracts
Comments: Four commenters objected to the language in proposed
Sec. 370.10(b), which applies the redesignation requirements in
proposed Secs. 370.10 through 370.17 to a designated agency's decision
to cancel or not renew a contract between the designated agency and an
entity actually carrying out the CAP. These commenters argued that only
an actual redesignation of the agency designated by the Governor of the
State to carry out the State's CAP is subject to the redesignation
provision in section 112(c)(1)(B) of the Act.
Discussion: The Secretary does not agree with the commenters. The
intent of section 112(c)(1)(B) of the Act is to protect a designated
agency from retaliation for pursuing complaints against agencies that
provide services under the Act, particularly those service providers
that are State agencies. In several States, the designated agency
contracts with other entities or individuals to carry out all or part
of its responsibilities under the CAP. If section 112(c)(1)(B) of the
Act is not made applicable to contracts between a designated agency and
those entities or individuals with which it contracts, the designated
agency (particularly if it is a State agency) may decide to terminate
its CAP contract because the contractor
[[Page 55762]]
is pursuing too many complaints against State agencies that are service
providers under the Act. Therefore, the Secretary believes that section
112(c)(1)(B) of the Act should be made applicable to contracts between
a designated agency and those entities or individuals with which it
contracts to carry out all or part of its responsibilities under the
CAP.
However, the Secretary believes that a designated agency that fails
to renew a contract simply because it is complying with State
procurement laws requiring contracts to be awarded through a
competitive bidding process meets the requirement to show good cause.
In addition, the Secretary believes clients and client applicants,
individuals with disabilities, and the public will be served best if a
designated agency that plans to issue a request for proposal pursuant
to State procurement laws holds a public hearing to allow interested
parties to comment on the proposed contract.
Changes: The Secretary has revised Sec. 370.10(b) in the final
regulations to clarify its meaning. The Secretary also has deleted
proposed Sec. 370.10(c) because it is unnecessary and has added a new
Sec. 370.10(c). New Sec. 370.10(c) establishes a rebuttable presumption
of ``good cause for redesignation'' if a designated agency does not
renew a contract for CAP services because it is following State
procurement laws that require contracts to be awarded only through a
competitive bidding process. Additionally, new Sec. 370.10(d) requires
a designated agency that follows State competitive procurement laws to
hold public hearings on the request for proposal before awarding the
new contract. Finally, the Secretary has added the State Rehabilitation
Advisory Council (as established under section 105 of the Act) and the
State Independent Living Council (as established under section 705 of
the Act) to the parties that must receive notice pursuant to
Sec. 370.11 of the final regulations.
Comments: Two commenters recommended adding further requirements to
the redesignation provisions in proposed Secs. 370.10 through 370.17 so
that equipment and case and fiscal records are transferred and the new
CAP agency is operational within a designated timeframe. Another
commenter suggested adding language to the redesignation requirements
to ensure that consumers experience no delay in access to CAP services
if a State's CAP agency is redesignated.
Discussion: The Secretary believes that the Governor of a State
will take whatever steps are necessary to minimize the possibility of
any delay in access to CAP services if a State's CAP agency is
redesignated and to ensure that the interests of client and client
applicants will be adequately protected during any redesignation.
Changes: None.
Comments: One commenter suggested revising the assurance required
by proposed Sec. 370.20(b)(1) concerning the designated agency's
authority to pursue legal, administrative, and other remedies because
the proposed assurance is applicable only to those individuals who are
receiving services under the Act and not to those individuals seeking
services under the Act.
Discussion: The Secretary did not intend to exclude those
individuals who are seeking services under the Act but who have not yet
begun receiving services under the Act from the protection provided by
the assurance required by proposed Sec. 370.20(b)(1).
Changes: The Secretary has revised the assurance required by
Sec. 370.20(b)(1) in the final regulations to include both clients and
client applicants.
Allocation of Funds (Sec. 370.30)
Comments: Three commenters suggested that the minimum allotments
described in proposed Sec. 370.30 are incorrect and should reflect the
amount of the current appropriation.
Discussion: The Secretary notes that proposed Sec. 370.30 parallels
the statutory language in section 112(e)(1) of the Act and provides
that, if section 112(e)(1)(D) of the Act applies, the minimum allotment
to each State will be increased. However, the Secretary recognizes that
the effect of this provision can be clarified.
Changes: The Secretary has added language to Sec. 370.30 in the
final regulations to clarify that the minimum allotment to each State
will be increased if Congress increases the appropriation for the CAP
as provided under section 112(e)(1)(D) of the Act.
Allowable Costs (Sec. 370.40)
Comments: None.
Discussion: Upon further review of proposed Sec. 370.40(e), the
Secretary has decided that the policy on offsetting costs that have
been disallowed as a result of an audit or a monitoring review should
be uniform for all Department programs and that no rationale exists for
treating the CAP differently.
Changes: The Secretary has deleted proposed Sec. 370.40(e).
Conflict of Interest (Sec. 370.41)
Comments: Six commenters requested clarification of proposed
Sec. 370.41, which prohibits employees of State agencies (who also may
be CAP employees) from serving in any capacity in any other project,
program, or community rehabilitation program under the Act. Two of
these commenters suggested revising this section to prohibit any
employee of the State VR agency, a center, or any other program funded
under the Act, from serving on a CAP board of directors or otherwise
occupying a position with authority to make personnel or management
decisions for the CAP. Another commenter stated that this section is
confusing because the Act mandates CAP participation on
``Rehabilitation Agency Advisory Boards.''
Discussion: The Secretary believes that a conflict of interest
exists if an employee of the designated agency serves in any capacity
that could jeopardize or give the appearance of jeopardizing the
independence of the designated agency. However, the Secretary
recognizes that an employee of a designated agency who carries out CAP
duties and responsibilities may be employed either by a State VR agency
(or another agency that provides services under the Act) that has been
``grandfathered'' (i.e., not subject to the ``independence''
requirement) pursuant to section 112(c)(1)(A) of the Act, or by a
center under contract with a designated agency pursuant to new
Sec. 370.2(f) of the final regulations. To avoid creating the conflict
of interest that may arise under these and other circumstances,
Sec. 370.41(a) of the final regulations clarifies that employees of a
State VR agency, or another agency that provides services under the
Act, as well as all other employees of the designated agency, may not
(1) serve concurrently in any position with a rehabilitation project,
program, or community service program receiving assistance under the
Act; or (2) provide any services under the Act other than CAP and PAIR
services. This prohibition does not prevent employees of the designated
agency from providing CAP services and (1) receiving a traineeship
under section 302 of the Act; (2) representing the designated agency on
a board or council, if designated agency participation on the board or
council is specifically permitted or mandated by the Act; and (3)
consulting with policymaking and administrative personnel in the State
and with rehabilitation projects, programs, or community rehabilitation
programs.
Changes: The Secretary has revised Sec. 370.41 in the final
regulations to clarify that employees of a designated agency, of a
center, or of entities or individuals with which a designated agency
contracts to carry out any duties
[[Page 55763]]
or responsibilities under the CAP, are limited in the roles they may
undertake in addition to their CAP duties and responsibilities.
Access to Policymakers (Sec. 370.42)
Comments: Three commenters suggested changing the word ``may'' in
the second sentence of proposed Sec. 370.42 to ``shall'' or ``should''
to parallel statutory language in sections 101(a) (18) and (23) of the
Act, which require that the designated State VR agency consult the
director of the CAP on policy matters related to the provision of VR
services under the State VR plan. Four commenters suggested adding the
words ``or his or her designee'' after the phrase ``CAP director,'' or
otherwise revising this section to clarify that, in those cases in
which the director of the designated agency is not the person in charge
of day-to-day operations of the CAP, the person who actually runs the
CAP should be consulted.
Discussion: The Secretary notes that the first sentence of
Sec. 370.42 is nearly identical to section 112(g)(2) of the Act and
includes the mandatory word ``must'' to require that the designated
agency be afforded access to policymaking and administrative personnel
in State and local rehabilitation programs, projects, or community
rehabilitation programs. However, the permissive ``may'' is used in the
second sentence of Sec. 370.42 to suggest one of several ways that the
designated agency could be provided access. Each State can decide how
to implement Sec. 370.42, and the Secretary expects that a variety of
mechanisms may be established. The Secretary believes that States will
comply fully with the spirit of section 112(g)(2) of the Act and that
Sec. 370.42 gives the States maximum flexibility in meeting this
requirement. Therefore, the Secretary believes that the current wording
is appropriate.
Changes: None.
Use of Mediation (Sec. 370.43)
Comments: Two commenters suggested changing the word ``and'' to
``or'' in proposed Sec. 370.43(a) to clarify that the designated agency
need not provide both good faith negotiations and mediation on behalf
of clients or client applicants. One commenter suggested modifying the
proposed definition to conform to the comparable provision for the PAIR
program in 34 CFR 381.10(a)(9) to clarify that the designated agency
need not use mediation if the designated agency determines that
mediation is not appropriate in a particular case.
Discussion: Section 112(g)(3) of the Act requires a designated
agency to use mediation to the maximum extent possible before resorting
to administrative or legal remedies. In addition, section 2(a)(2) of
the Executive Order on Civil Justice Reform, E.O. 12778 (January 21,
1991), requires that all Federal regulations ``be written to minimize
needless litigation.'' Requiring a designated agency to engage in good
faith negotiations and mediation, to the maximum extent possible,
before the designated agency may resort to formal administrative or
legal remedies is consistent with both section 112(g)(3) of the Act and
E.O. 12778.
However, whether mediation is appropriate in a particular case
depends on the circumstances of the case, including the issues raised
and applicable legal deadlines and State administrative requirements.
For example, mediation in a specific situation may not be required
before the designated agency may resort to formal administrative or
legal remedies if a statutory, regulatory, or other legal deadline
precludes mediation as impractical, or if mediation is otherwise
determined to be inappropriate under the circumstances of that
particular case. The statutory mandate to use mediation to the maximum
extent possible permits a case-by-case determination of the
appropriateness of mediation and does not establish an inflexible
requirement that mediation be used in all cases.
If a designated agency does not have sufficient resources both to
advocate for its clients and to obtain an independent mediator to
assist in resolving a dispute, it is not required to use mediation.
Under those circumstances, a designated agency should make full use of
the negotiations process.
Changes: The Secretary has added language to Sec. 370.43 that
permits a designated agency to take into account the extent of its
resources in deciding whether or not to engage in mediation in a
particular case. The Secretary also has added a new paragraph (b) to
Sec. 370.43 that clarifies when a designated agency may use its
employees to conduct mediation. See the earlier discussion of this
issue in the discussion of the definition of ``mediation.''
Comments: Five commenters recommended revising proposed Sec. 370.43
to include consideration of client choice in the decision to engage in
mediation.
Discussion: Although the 1992 Amendments introduced a new level of
client choice to programs funded under the Act, the requirement in
section 112(g)(3) that designated agencies use mediation to the maximum
extent possible remained unchanged and is not subject to client choice.
Changes: None.
Comments: One commenter expressed concern that a designated agency
will not have to account for the proper expenditure of CAP funds
because proposed Sec. 370.43 does not require a designated agency to
maintain records that will support its decision to engage in formal
administrative or legal remedies.
Discussion: A State must include in its application for assistance
under the CAP the general assurance required by Sec. 370.20(c)(2) that
a designated agency will meet the requirements in these regulations.
The specific assurance that a designated agency will implement
procedures to ensure that mediation is used to the maximum extent
possible before formal administrative or legal remedies are undertaken
is implicit in the general assurance required by Sec. 370.20(c)(2).
Therefore, the Secretary is satisfied that designated agencies will
maintain sufficient documentation to support their obligation to engage
in mediation to the maximum extent possible before engaging in formal
administrative or legal remedies on behalf of clients or client
applicants.
Changes: None.
Annual Reports (Sec. 370.44)
Comments: Seven commenters suggested that the proposed definitions
of ``requests for assistance'' and ``requests for assistance that the
designated agency was unable to serve'' in Sec. 370.44 be clarified and
questioned whether this section applies to ``requests for information
and referrals.'' Three of these commenters recommended changes that
would require a designated agency to identify more specifically why it
was unable to serve a particular request for assistance. One of these
commenters suggested that this section be revised to require a
designated agency to include in its annual report information on (1)
how many individuals were denied the range of CAP services that those
individuals felt they were entitled to receive from the designated
agency, and (2) the reasons that these requests for CAP services were
denied. Two of these commenters suggested that this section also be
revised to require a designated agency to include in its annual report
information about specific groups or classes of individuals with
disabilities who were unserved or underserved by the designated agency
and the reasons (e.g., lack of CAP resources, language barriers,
factors related to disability, or
[[Page 55764]]
ineligibility) that these groups or classes were not served
appropriately.
Discussion: The Secretary notes that section 112(g)(5) of the Act
requires a designated agency to include in its annual report
information on (1) the number of ``requests the [CAP] * * * receives
annually'' and ``requests [the CAP] is unable to serve''; and (2) the
reasons that the [CAP] is unable to serve all the requests.'' These
requests include requests for information and referral. The Secretary
also recognizes that a designated agency may be unable to provide
advocacy services to some individuals who request assistance under the
CAP. The Secretary believes Congress intended that a designated agency
identify in its annual report only those requests for advocacy services
that a designated agency is unable to serve. In providing the reasons
why it was unable to serve requests for advocacy services, Sec. 370.44
of the final regulations requires the designated agency to provide a
summary of the reasons why the cases were closed before resolution. The
Secretary also agrees with the commenters who suggested that the
regulations should include more specific requirements for the types of
cases that the designated agency should include in its annual report.
Changes: The Secretary has revised Sec. 370.44 in the final
regulations to clarify that ``requests for assistance'' include
``requests for information and referral'' and that ``requests for
assistance that the designated agency was unable to serve'' means
requests for advocacy services that the designated agency was unable to
serve. Specifically, the Secretary has revised Sec. 370.44 in the final
regulations to clarify that designated agencies are required to report
on (1) the number of requests received by the designated agency for
information on services and benefits under the Act and Title I of the
ADA; (2) the number of referrals to other agencies made by the
designated agency and the reason or reasons for those referrals; (3)
the number of requests for advocacy services received by the designated
agency for assistance from clients or client applicants; (4) the number
of the requests for advocacy services that the designated agency was
unable to serve; and (5) the reasons that the designated agency was
unable to serve all of the requests for advocacy services.
Comments: One commenter recommended deleting the requirement in
proposed Sec. 370.44(d) that the annual report contain ``any other
information that the Secretary may require'' because it is too open-
ended. Five commenters suggested modifying this proposed requirement to
indicate that the Secretary must communicate any new reporting
requirements prior to the beginning of the fiscal year for which that
information is requested.
Discussion: The Secretary will make every effort to provide
reasonable notice before new requirements take effect. Nonetheless, the
Secretary must have the ability to respond to unforeseen circumstances
and changes.
Changes: None.
Protection, Use, and Release of Personal Information (Sec. 370.48)
Comments: One commenter suggested deleting the phrase ``parent, or
other legally authorized representative or advocate'' from proposed
Sec. 370.48(b) because the release of information by these individuals
is not allowed under the Federal Fair Information Practices Act, 5
U.S.C. 552a, and other Federal and State statutes.
Discussion: Nothing in Sec. 370.48 is intended to supersede any
other Federal law that may restrict or expand an individual's right to
control his or her personal information or that restricts another
individual's ability to act on behalf of someone else. The statutory
provision referred to by the commenter in 5 U.S.C. 552a applies to the
disclosure of personal information by Federal agencies, not to the
power given through a valid legal instrument to any individual (e.g., a
parent, legal guardian, or attorney) to consent, on behalf of another
person, to the release of personal information about that other person.
Therefore, section 552a is not relevant to Sec. 370.48(b).
Changes: The Secretary has added the word ``legal'' in front of the
word ``guardian'' to Sec. 370.48(b) in the final regulations to stress
that only those individuals who have been given legal authority to act
on behalf of an individual may do so.
Comments: One commenter suggested revising proposed Sec. 370.48(c)
to prevent State VR agency directors from obtaining client information
from designated agencies that are not subject to the independence
requirement in section 112(c)(1)(A) of the Act.
Discussion: The Secretary believes that the limitations on the
unauthorized use of personal information described in Sec. 370.48(b)
will prevent the disclosure of personal information to unauthorized
persons or for unauthorized purposes under Sec. 370.48(c). Section
370.48(b) requires the designated agency to use personally identifiable
information only for those purposes directly connected with the CAP.
The files of a client or client applicant that are maintained by a
designated agency are presumptively confidential and subject only to
the exceptions listed in Sec. 370.48(c) through (e). Therefore, the
State VR agency director may not use his or her authority under
Sec. 370.48(c) to gain access to files containing personal information
about requests for assistance under the CAP, unless it is for a purpose
directly connected to the CAP or is otherwise subject to the exceptions
in Sec. 370.48(c) through (e).
Changes: None.
Comments: Two commenters recommended that ``substantial'' evidence
should be required before the Secretary may obtain access to personal
information pursuant to proposed Sec. 370.48(e). Two other commenters
suggested that the Secretary should be permitted to request only
personal information that is reasonably likely to lead to relevant
evidence of the designated agency's alleged wrongdoing.
Discussion: The Secretary fully appreciates a designated agency's
desire to protect the confidentiality of personal information about
clients and client applicants. However, in a similar program, Congress
recognized the need for the Secretary to have access to personal
information if there is probable cause to believe a recipient of
Federal funds has violated its legislative mandate or misused Federal
funds. See H. Rep. No. 102-822, 102d Cong., 2d Sess. 123 (1992).
Therefore, if an audit, evaluation, monitoring review, State plan
assurance review, or other investigation produces reliable evidence
that there is probable cause to believe that the designated agency has
violated its legislative mandate or misused Federal funds, or if the
Secretary determines the personal information that is sought may
reasonably lead to further evidence that is directly related to alleged
misconduct of the designated agency, Sec. 370.48(e) of the final
regulations permits the Secretary to gain access to personal
information of the designated agency's clients or client applicants.
The Secretary believes the limited access to the identity of, or any
other personally identifiable information related to, any individual
requesting assistance under the CAP that is given to the Secretary by
Sec. 370.48(e) is fully consistent with section 112(g)(6) of the Act.
Changes: The Secretary has revised Sec. 370.48(e) in the final
regulations to clarify the Secretary's access to personal information.
If an audit, evaluation, monitoring review, State plan assurance
review, or other investigation produces reliable evidence that there is
probable cause to believe that the designated agency has violated its
legislative
[[Page 55765]]
mandate or misused Federal funds, or the Secretary determines that
specific and limited personal information may reasonably lead to
further evidence that is directly related to alleged misconduct of the
designated agency, Sec. 370.48(e) grants the Secretary access to that
personal information of individuals who have received or sought
services from the designated agency.
Comments: One commenter suggested deleting proposed Sec. 370.48(f),
which provides that the right of a person or designated agency not to
produce documents or disclose information is governed by the common law
of privileges, as interpreted by the courts of the United States. This
commenter believes proposed Sec. 370.48(f) creates, without any
statutory authority, a two-tier system in which clients of a designated
agency would not receive the same protection of confidentiality when
asserting their attorney-client privilege as individuals who retain
private counsel. Two other commenters suggested deleting proposed
Sec. 370.48(f) because they believe there is no body of Federal common
law applicable to the law of privileges and the current wording appears
to exclude consideration of other Federal or State protections that may
apply. These two commenters also stated that the common law of
privileges in the Federal courts was replaced years ago by the Federal
Rules of Evidence.
Discussion: Section 370.48(f) of the final regulations provides
that the Secretary's access to the identity of, or any other personally
identifying information (i.e., name, address, telephone number, social
security number, or any other official code or number by which an
individual may be readily identified) related to, any individual
requesting assistance under the CAP is governed by the common law of
privileges, as interpreted by the courts of the United States. Section
370.48(f) is consistent with Rule 501 of the Federal Rules of Evidence
(FRE), which govern proceedings in the courts of the United States that
raise a Federal question and is, in effect, identical to Sec. 81.17 of
34 CFR Part 81, which governs proceedings before the Office of
Administrative Law Judges of the Department of Education concerning the
enforcement of legal requirements under applicable Department programs.
Rule 501 of the FRE reads, in relevant part, as follows:
Except as otherwise required by the Constitution of the United
States or provided by Act of Congress or in rules prescribed by the
Supreme Court pursuant to statutory authority, the privilege of a
witness, person, government, State or political subdivision thereof
shall be governed by the principles of the common law as they may be
interpreted by the courts of the United States in the light of
reason and experience.
28 U.S.C. Appendix-FRE 501 (emphasis added). In a case that raises a
Federal question, the language of Rule 501 clearly provides that
questions of evidentiary privileges are governed by Federal common law.
U.S. v. Zolin, 491 U.S. 554, 562, 109 S.Ct. 2619, 2625 (1989); Tornay
v. U.S., 840 F.2d 1424, 1426 (9th Cir. 1988). More specifically, if a
case raises a Federal question, Rule 501 applies to cases that raise
the attorney-client privilege as a bar to disclosure of information.
U.S. v. Goldberger and Dubin, P.C., et al., 935 F.2d 501, 505 (2d Cir.
1991). State laws governing the protection of attorney-client
confidences and secrets when a Federal agency seeks disclosure of those
confidences pursuant to the Federal agency's statutory or regulatory
authority would not be relevant. U.S. v. Goldberger, supra; Dole v.
Milonas, 889 F.2d 885, 889 (9th Cir. 1989); U.S. v. Hodge and Zweig,
548 F.2d 1347, 1352 (9th Cir. 1977). Nor does Rule 501 distinguish
between a party or witness who is represented by private counsel or by
counsel provided under a Federal program such as the CAP.
A dispute between the Secretary and a designated agency concerning
the designated agency's proper expenditure of CAP funds raises a
``Federal question'' (i.e., a case in which a question of law arises
under the Constitution of the United States, a Federal statute, or
Federal regulations) because the dispute would involve a question under
the Act and the CAP regulations. In addition, the issue of the
Secretary's access to personal information that is relevant to the
designated agency's proper expenditure of CAP funds would be part of
that Federal question. Therefore, pursuant to Sec. 370.48(f), which
applies the principle of Rule 501 to these circumstances, the
Secretary's access to personal information is governed by the Federal
common law of privileges.
The Secretary understands a designated agency's legitimate concern
of maintaining the sanctity of the attorney-client privilege created by
the relationship between a designated agency's attorneys and
individuals who come to the designated agency seeking CAP services. The
Secretary also understands a designated agency's legitimate concern
that individuals who come to the designated agency seeking CAP services
should enjoy the same privileges as those individuals who seek private
counsel. However, in any Federal question case in which the Federal
government is a party, a party or witness who is represented by private
counsel is subject to Rule 501. Nothing in Sec. 370.48(f) of the final
regulations changes this or limits or expands the applicability of the
common law of privileges, as interpreted by the courts of the United
States, to the Secretary's access to the identity of, or any other
personally identifiable information related to, any individual
requesting assistance under the CAP. Therefore, clients of a designated
agency will receive the same protection of confidentiality when
asserting their attorney-client privilege as individuals who retain
private counsel.
As a final note, the FRE became effective for cases in Federal
courts on July 1, 1975.
Changes: None.
Executive Order 12866
These final regulations have been reviewed in accordance with
Executive Order 12866. Under the terms of the order the Secretary has
assessed the potential costs and benefits of this regulatory action.
The potential costs associated with the final regulations are those
resulting from statutory requirements and those determined by the
Secretary to be necessary for administering these programs effectively
and efficiently.
In assessing the potential costs and benefits--both quantitative
and qualitative--of these regulations, the Secretary has determined
that the benefits of the regulations justify the costs. A further
discussion of the potential costs and benefits of these proposed
regulations is contained in the summary at the end of this section of
the preamble.
The Secretary also has determined that this regulatory action does
not unduly interfere with State, local, and tribal governments in the
exercise of their governmental functions.
Summary of Potential Costs and Benefits of Regulatory Provisions
Discussed Earlier in This Preamble
The following are the provisions of these regulations that may add
significant cost or impose significant burden on the States under this
program:
Eligible Subgrantees (Sec. 370.2(e))
This provision in the final regulations allows designated agencies
to contract to carry out part or all of the State's CAP, but does not
permit a designated agency to contract with or subgrant with entities
or individuals that provide services under the Act, other than centers.
This provision could result in
[[Page 55766]]
some disruption for those designated agencies that have contracted with
service providers other than centers. However, the need to prevent the
conflict of interest that results if an entity attempts to advocate for
an individual who feels aggrieved by that same entity outweighs the
disruption that will occur for those designated agencies engaged in
this practice.
Definitions (Sec. 370.6(b))--Mediation
The definition of ``mediation'' in Sec. 370.6(b) and the
requirements in Sec. 370.43 of the final regulations clarify the
relationship between advocacy and mediation and are designed to ensure
compliance with section 112(g)(3) of the Act. Paragraph (b) of
Sec. 370.43 allows designated agencies to use their employees as
mediators under limited circumstances.
Public comment on the NPRM demonstrated great confusion and
misunderstanding about the meaning of ``mediation,'' which section
112(g)(3) of the Act requires designated agencies to engage in to the
maximum extent possible before resorting to administrative or legal
remedies. The interpretation of the term ``mediation'' by many
designated agencies is inconsistent with any lay or legal definition of
``mediation.'' Part of the confusion and misunderstanding has resulted
from the lack of understanding of the difference between ``advocacy''
and ``mediation.'' This confusion and misunderstanding has been
aggravated by ambiguities in the current regulatory definition of
``mediation.'' See 34 CFR 370.43(b). Public comment also indicated that
the confusion and misunderstanding about the meaning of ``mediation''
has frequently resulted in clients and client applicants receiving less
than the full ``advocacy'' to which they are entitled from designated
agencies.
Because of the flexibility given in Sec. 370.43(b) to designated
agencies to use their employees as mediators under certain conditions
and because Sec. 370.43(a) allows designated agencies to consider their
resources in determining whether to engage in mediation, the definition
of ``mediation'' and the requirements in these provisions should add
little, if any, cost to the operation of a State's CAP. The benefit to
clients and client applicants of having advocates who will advocate
only for them and who will not also attempt to be neutral third parties
in their disputes with service providers far outweighs the minimal cost
to the designated agencies.
Applicability of Redesignation Requirements (Secs. 370.10 Through
370.17) to Contracts
These provisions in the final regulations extend the protections of
section 112(c)(1)(B) of the Act (concerning the redesignation of a
designated agency by the Governor of a State) to a designated agency's
decision to cancel or not renew a contract with another entity or
individual to carry out or operate part or all of a State's CAP. As
discussed earlier, designated agencies in several States contract with
centers, individuals, and other entities to carry out or operate part
or all of a State's CAP.
These provisions have been written with the minimum prescription
necessary. For example, a designated agency is presumed to have good
cause if it follows State procurement laws that require competitive
bidding to renew a contract.
The costs of requiring designated agencies to comply with the
redesignation requirements if they decide to cancel or not renew a
contract are outweighed by the need to extend to contractors the same
protection that section 112(c)(1)(B) provides to a designated agency
from improper redesignation by the Governor of the State. This
protection of a contractor's independence will help to ensure that
clients and client applicants receive effective advocacy.
Conflict of Interest (Sec. 370.41)
The effect of the conflict of interest provision is similar to that
of the provisions concerning ``mediation'' in the final regulations.
The exception on contracting with service providers in Sec. 370.2(e) of
the final regulations and the ``grandfather'' clause in section
112(c)(1)(A) of the Act (permitting an agency of the State that
provides services under the Act to operate a State's CAP under certain
conditions) create a potential conflict of interest for those employees
of centers and State agencies that operate a State's CAP who are
assigned to work on the CAP.
In the same manner that the Secretary does not believe the same
individual may act both as a mediator and an advocate, the Secretary
does not believe an employee may serve two employers at the same time,
especially if the two employers have conflicting interests. An employee
who is paid by a service provider and whose job security is determined
by the service provider has an inherent conflict of interest in
advocating on behalf of a client or client applicant against the
service provider. The cost of prohibiting this conflict of interest is
far outweighed by the need to provide effective advocacy for clients
and client applicants who are dissatisfied with the actions of a
service provider.
Intergovernmental Review
This program is 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 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
this program.
Assessment of Educational Impact
In the notice of proposed rulemaking, the Secretary requested
comments on whether the proposed regulations would require transmission
of information that is being gathered by or is available from any other
agency or authority of the United States.
Based on the response to the proposed regulations and on its own
review, the Department has determined that the regulations in this
document do not require transmission of information that is being
gathered by or is available from any other agency or authority of the
United States.
List of Subjects in 34 CFR Part 370
Administrative practice and procedure, Education, Client
assistance, Grant program--education, Grant program--social programs,
Reporting and recordkeeping requirements, vocational rehabilitation.
(Catalog of Federal Domestic Assistance Number 84.161, Client
Assistance Program)
Dated: August 4,1995.
Howard R. Moses,
Acting Assistant Secretary for Special Education and Rehabilitative
Services.
The Secretary amends Title 34 of the Code of Federal Regulations by
revising Part 370 to read as follows:
PART 370--CLIENT ASSISTANCE PROGRAM
Subpart A--General
Sec.
370.1 What is the Client Assistance Program (CAP)?
370.2 Who is eligible for an award?
370.3 Who is eligible for services and information under the CAP?
370.4 What kinds of activities may the Secretary fund?
370.5 What regulations apply?
[[Page 55767]]
370.6 What definitions apply?
370.7 What shall the designated agency do to make its services
accessible?
Subpart B--What Requirements Apply to Redesignation?
370.10 When do the requirements for redesignation apply?
370.11 What requirements apply to a notice of proposed
redesignation?
370.12 How does a designated agency preserve its right to appeal a
redesignation?
370.13 What are the requirements for a decision to redesignate?
370.14 How does a designated agency appeal a written decision to
redesignate?
370.15 What must the Governor of a State do upon receipt of a copy
of a designated agency's written appeal to the Secretary?
370.16 How does the Secretary review an appeal of a redesignation?
370.17 When does a redesignation become effective?
Subpart C--How Does a State Apply For a Grant?
370.20 What must be included in a request for a grant?
Subpart D--How Does the Secretary Allocate and Reallocate Funds to a
State?
370.30 How does the Secretary allocate funds?
370.31 How does the Secretary reallocate funds?
Subpart E--What Post-Award Conditions Must Be Met by a Designated
Agency?
370.40 What are allowable costs?
370.41 What conflict of interest provision applies to employees of
a designated agency?
370.42 What access must the CAP be afforded to policymaking and
administrative personnel?
370.43 What requirement applies to the use of mediation procedures?
370.44 What reporting requirement applies to each designated
agency?
370.45 What limitation applies to the pursuit of legal remedies?
370.46 What consultation requirement applies to a Governor of a
State?
370.47 When must grant funds be obligated?
370.48 What are the special requirements pertaining to the
protection, use, and release of personal information?
Authority: 29 U.S.C. 732, unless otherwise noted.
Subpart A--General
Sec. 370.1 What is the Client Assistance Program (CAP)?
The purpose of this program is to establish and carry out CAPs
that--
(a) Advise and inform clients and client applicants of all services
and benefits available to them through programs authorized under the
Rehabilitation Act of 1973 (Act), as amended;
(b) Assist and advocate for clients and client applicants in their
relationships with projects, programs, and community rehabilitation
programs providing services under the Act; and
(c) Inform individuals with disabilities in the State, especially
individuals with disabilities who have traditionally been unserved or
underserved by vocational rehabilitation programs, of the services and
benefits available to them under the Act and under Title I of the
Americans with Disabilities Act of 1990 (ADA), 42 U.S.C. 12101-12213.
(Authority: 29 U.S.C. 732(a))
Sec. 370.2 Who is eligible for an award?
(a) Any State, through its Governor, is eligible for an award under
this part if the State submits, and receives approval of, an
application in accordance with Sec. 370.20.
(b) The Governor of each State shall designate a public or private
agency to conduct the State's CAP under this part.
(c) Except as provided in paragraph (d) of this section, the
Governor shall designate an agency that is independent of any agency
that provides treatment, services, or rehabilitation to individuals
under the Act.
(d) The Governor may, in the initial designation, designate an
agency that provides treatment, services, or rehabilitation to
individuals with disabilities under the Act if, at any time before
February 22, 1984, there was an agency in the State that both--
(1) Was a grantee under section 112 of the Act by serving as a
client assistance agency and directly carrying out a CAP; and
(2) Was, at the same time, a grantee under any other provision of
the Act.
(e) Except as permitted in paragraph (f) of this section, an agency
designated by the Governor of a State to conduct the State's CAP under
this part may not award a subgrant to or enter into a contract with an
agency that provides services under this Act either to carry out the
CAP or to provide services under the CAP.
(f) An agency designated by the Governor of a State to conduct the
State's CAP under this part may enter into a contract with a center for
independent living (center) that provides services under the Act if--
(1) On February 22, 1984, the designated agency was contracting
with one or more centers to provide CAP services; and
(2) The designated agency meets the requirements of paragraph (g)
of this section.
(g) A designated agency that contracts to provide CAP services with
a center (pursuant to paragraph (f) of this section) or with an entity
or individual that does not provide services under the Act remains
responsible for--
(1) The conduct of a CAP that meets all of the requirements of this
part;
(2) Ensuring that the center, entity, or individual expends CAP
funds in accordance with--
(i) The regulations in this part; and
(ii) The cost principles applicable to the designated agency; and
(3) The direct day-to-day supervision of the CAP services being
carried out by the contractor. This day-to-day supervision must include
the direct supervision of the individuals who are employed or used by
the contractor to provide CAP services.
(Authority: 29 U.S.C. 711(c) and 732(a) and (c)(1)(A))
Sec. 370.3 Who is eligible for services and information under the CAP?
(a) Any client or client applicant is eligible for the services
described in Sec. 370.4.
(b) Any individual with a disability is eligible to receive
information on the services and benefits available to individuals with
disabilities under the Act and Title I of the ADA.
(Authority: 29 U.S.C. 732(a))
Sec. 370.4 What kinds of activities may the Secretary fund?
(a) Funds made available under this part must be used for
activities consistent with the purposes of this program, including--
(1) Advising and informing clients, client applicants, and
individuals with disabilities in the State, especially individuals with
disabilities who have traditionally been unserved or underserved by
vocational rehabilitation programs, of--
(i) All services and benefits available to them through programs
authorized under the Act; and
(ii) Their rights in connection with those services and benefits;
(2) Informing individuals with disabilities in the State,
especially individuals with disabilities who have traditionally been
unserved or underserved by vocational rehabilitation programs, of the
services and benefits available to them under Title I of the ADA;
(3) Upon the request of a client or client applicant, assisting and
advocating on behalf of a client and client applicant in his or her
relationship with projects, programs, and community rehabilitation
programs that provide services under the Act by engaging in individual
or systemic advocacy and pursuing, or assisting and
[[Page 55768]]
advocating on behalf of a client and client applicant to pursue, legal,
administrative, and other available remedies, if necessary--
(i) To ensure the protection of the rights of a client or client
applicant under the Act; and
(ii) To facilitate access by individuals with disabilities and
individuals with disabilities who are making the transition from public
school programs to services funded under the Act; and
(4) Providing information to the public concerning the CAP.
(b) In providing assistance and advocacy services under this part
with respect to services under Title I of the Act, a designated agency
may provide assistance and advocacy services to a client or client
applicant to facilitate the individual's employment, including
assistance and advocacy services with respect to the individual's
claims under Title I of the ADA, if those claims under Title I of the
ADA are directly related to services under the Act that the individual
is receiving or seeking.
(Authority: 29 U.S.C. 732(a))
Sec. 370.5 What regulations apply?
The following regulations apply to the expenditure of funds under
the CAP:
(a) The Education Department General Administrative Regulations
(EDGAR) as follows:
(1) 34 CFR Part 74 (Administration of Grants to Institutions of
Higher Education, Hospitals and Nonprofit Organizations) applies to the
designated agency if the designated agency is not a State agency, local
government agency, or Indian tribal organization. As the entity that
eventually, if not directly, receives the CAP grant funds, the
designated agency is considered a recipient for purposes of part 74.
(2) 34 CFR Part 76 (State-Administered Programs) applies to the
State and, if the designated agency is a State or local government
agency, to the designated agency, except for--
(i) Sec. 76.103;
(ii) Secs. 76.125 through 76.137;
(iii) Secs. 76.300 through 76.401;
(iv) Sec. 76.708;
(v) Sec. 76.734; and
(vi) Sec. 76.740.
(3) 34 CFR Part 77 (Definitions that Apply to Department
Regulations).
(4) 34 CFR Part 79 (Intergovernmental Review of Department of
Education Programs and Activities).
(5) 34 CFR Part 80 (Uniform Administrative Requirements for Grants
and Cooperative Agreements to State and Local Governments) applies to
the State and, if the designated agency is a State or local government
agency, to the designated agency.
(6) 34 CFR Part 81 (General Education Provisions Act-Enforcement)
applies to both the State and the designated agency, whether or not the
designated agency is the actual recipient of the CAP grant. As the
entity that eventually, if not directly, receives the CAP grant funds,
the designated agency is considered a recipient for purposes of Part
81.
(7) 34 CFR Part 82 (New Restrictions on Lobbying).
(8) 34 CFR Part 85 (Governmentwide Debarment and Suspension
(Nonprocurement) and Governmentwide Requirements for Drug-Free
Workplace (Grants)).
(b) The regulations in this Part 370.
(c) The regulations in 34 CFR 369.43, 369.46 and 369.48, relating
to various conditions to be met by grantees. (NOTE: Any funds made
available to a State under this program that are transferred by a State
to a designated agency do not comprise a subgrant as that term is
defined in 34 CFR 77.1. The designated agency is not, therefore, in
these circumstances a subgrantee, as that term is defined in that
section or in 34 CFR Parts 74, 76, or 80.)
(Authority: 29 U.S.C. 711(c) and 732)
Sec. 370.6 What definitions apply?
(a) Definitions in EDGAR. The following terms used in this part are
defined in 34 CFR 77.1:
Award
EDGAR
Fiscal year
Nonprofit
Private
Public
Secretary
(b) Other definitions. The following definitions also apply to this
part:
Act means the Rehabilitation Act of 1973, as amended.
Advocacy means pleading an individual's cause or speaking or
writing in support of an individual. Advocacy may be formal, as in the
case of a lawyer representing an individual in a court of law or in
formal administrative proceedings before government agencies (whether
State, local or Federal). Advocacy also may be informal, as in the case
of a lawyer or non-lawyer representing an individual in negotiations,
mediation, or informal administrative proceedings before government
agencies (whether State, local or Federal), or as in the case of a
lawyer or non-lawyer representing an individual's cause before private
entities or organizations, or government agencies (whether State, local
or Federal). Advocacy may be on behalf of--
(1) A single individual, in which case it is individual advocacy;
(2) More than one individual or a group or class of individuals, in
which case it is systems (or systemic) advocacy; or
(3) Oneself, in which case it is self advocacy.
Class action means a formal legal suit on behalf of a group or
class of individuals filed in a Federal or State court that meets the
requirements for a ``class action'' under Federal or State law.
``Systems (or systemic) advocacy'' that does not include filing a
formal class action in a Federal or State court is not considered a
class action for purposes of this part.
Client or client applicant means an individual receiving or seeking
services under the Act, respectively.
Designated agency means the agency designated by the Governor under
Sec. 370.2 to conduct a client assistance program under this part.
Mediation means the act or process of using an independent third
party to act as a mediator, intermediary, or conciliator to settle
differences or disputes between persons or parties. The third party who
acts as a mediator, intermediary, or conciliator may not be any entity
or individual who is connected in any way with the eligible system or
the agency, entity, or individual with whom the individual with a
disability has a dispute. Mediation may involve the use of professional
mediators or any other independent third party mutually agreed to by
the parties to the dispute.
Services under the Act means vocational rehabilitation, independent
living, supported employment, and other similar rehabilitation services
provided under the Act. For purposes of the CAP, the term ``services
under the Act'' does not include activities carried out under the
protection and advocacy program authorized by section 509 of the Act
(i.e., the Protection and Advocacy of Individual Rights (PAIR) program,
34 CFR Part 381).
State means, in addition to each of the several States of the
United States, the District of Columbia, the Commonwealth of Puerto
Rico, The United States Virgin Islands, Guam, American Samoa, the
Commonwealth of the Northern Mariana Islands, and the Republic of Palau
(but only until September 30, 1998), except for purposes of the
allotments under section 112 of the Act, in which case ``State'' does
not mean or include Guam, American Samoa, the United States Virgin
Islands, the Commonwealth of the Northern Mariana Islands, and the
Republic of Palau.
[[Page 55769]]
(Authority: 29 U.S.C. 711(c) and 732; P.L. 101-219 (Dec. 12, 1989);
P.L. 99-658 (Nov. 14, 1986); and P.L. 99-239 (Jan. 14, 1986))
Sec. 370.7 What shall the designated agency do to make its services
accessible?
The designated agency shall provide, as appropriate, the CAP
services described in Sec. 370.4 in formats that are accessible to
clients or client applicants who seek or receive CAP services.
(Authority: 29 U.S.C. 711(c))
Subpart B--What Requirements Apply to Redesignation?
Sec. 370.10 When do the requirements for redesignation apply?
(a) The Governor may not redesignate the agency designated pursuant
to section 112(c) of the Act and Sec. 370.2(b) without good cause and
without complying with the requirements of Secs. 370.10 through 370.17.
(b) For purposes of Secs. 370.10 through 370.17, a ``redesignation
of'' or ``to redesignate'' a designated agency means any change in or
transfer of the designation of an agency previously designated by the
Governor to conduct the State's CAP to a new or different agency, unit,
or organization, including--
(1) A decision by a designated agency to cancel its existing
contract with another entity with which it has previously contracted to
carry out and operate all or part of its responsibilities under the CAP
(including providing advisory, assistance, or advocacy services to
eligible clients and client applicants); or
(2) A decision by a designated agency not to renew its existing
contract with another entity with which it has previously contracted.
Therefore, an agency that is carrying out a State's CAP under a
contract with a designated agency is considered a designated agency for
purposes of Secs. 370.10 through 370.17.
(c) For purposes of paragraph (a) of this section, a designated
agency that does not renew a contract for CAP services because it is
following State procurement laws that require contracts to be awarded
through a competitive bidding process is presumed to have good cause
for not renewing an existing contract. However, this presumption may be
rebutted.
(d) If State procurement laws require a designated agency to award
a contract through a competitive bidding process, the designated agency
must hold public hearings on the request for proposal before awarding
the new contract.
(Authority: 29 U.S.C. 711(c) and 732(c)(1)(B))
Sec. 370.11 What requirements apply to a notice of proposed
redesignation?
(a) Prior to any redesignation of the agency that conducts the CAP,
the Governor shall give written notice of the proposed redesignation to
the designated agency, the State Rehabilitation Advisory Council
(SRAC), and the State Independent Living Council (SILC) and publish a
public notice of the Governor's intention to redesignate. Both the
notice to the designated agency, the SRAC, and the SILC and the public
notice must include, at a minimum, the following:
(1) The Federal requirements for the CAP (section 112 of the Act).
(2) The goals and function of the CAP.
(3) The name of the current designated agency.
(4) A description of the current CAP and how it is administered.
(5) The reason or reasons for proposing the redesignation,
including why the Governor believes good cause exists for the proposed
redesignation.
(6) The effective date of the proposed redesignation.
(7) The name of the agency the Governor proposes to administer the
CAP.
(8) A description of the system that the redesignated (i.e., new)
agency would administer.
(b) The notice to the designated agency must--
(1) Be given at least 30 days in advance of the Governor's written
decision to redesignate; and
(2) Advise the designated agency that it has at least 30 days from
receipt of the notice of proposed redesignation to respond to the
Governor and that the response must be in writing.
(c) The notice of proposed redesignation must be published in a
place and manner that provides the SRAC, the SILC, individuals with
disabilities or their representatives, and the public with at least 30
days to submit oral or written comments to the Governor.
(d) Following public notice, public hearings concerning the
proposed redesignation must be conducted in an accessible format that
provides individuals with disabilities or their representatives an
opportunity for comment. The Governor shall maintain a written public
record of these hearings.
(e) The Governor shall fully consider any public comments before
issuing a written decision to redesignate.
(Approved by the Office of Management and Budget under control
number 1820-0520)
(Authority: 29 U.S.C. 711(c) and 732(c)(1)(B))
Sec. 370.12 How does a designated agency preserve its right to appeal
a redesignation?
(a) To preserve its right to appeal a Governor's written decision
to redesignate (see Sec. 370.13), a designated agency must respond in
writing to the Governor within 30 days after it receives the Governor's
notice of proposed redesignation.
(b) The designated agency shall send its response to the Governor
by registered or certified mail, return receipt requested, or other
means that provides a record that the Governor received the designated
agency's response.
(Approved by the Office of Management and Budget under control
number 1820-0520)
(Authority: 29 U.S.C. 711(c) and 732(c)(1)(B))
Sec. 370.13 What are the requirements for a decision to redesignate?
(a) If, after complying with the requirements of Sec. 370.11, the
Governor decides to redesignate the designated agency, the Governor
shall provide to the designated agency a written decision to
redesignate that includes the rationale for the redesignation. The
Governor shall send the written decision to redesignate to the
designated agency by registered or certified mail, return receipt
requested, or other means that provides a record that the designated
agency received the Governor's written decision to redesignate.
(b) If the designated agency submitted to the Governor a timely
response to the Governor's notice of proposed redesignation, the
Governor shall inform the designated agency that it has at least 15
days from receipt of the Governor's written decision to redesignate to
file a formal written appeal with the Secretary.
(Approved by the Office of Management and Budget under control
number 1820-0520)
(Authority: 29 U.S.C. 711(c) and 732(c)(1)(A))
Sec. 370.14 How does a designated agency appeal a written decision to
redesignate?
(a) A designated agency may appeal to the Secretary a Governor's
written decision to redesignate only if the designated agency submitted
to the Governor a timely written response to the Governor's notice of
proposed redesignation in accordance with Sec. 370.12.
(b) To appeal to the Secretary a Governor's written decision to
redesignate, a designated agency shall file a formal written appeal
with the Secretary within 15 days after the designated agency's receipt
of the Governor's written decision to redesignate. The date of filing
of the
[[Page 55770]]
designated agency's written appeal with the Secretary will be
determined in a manner consistent with the requirements of 34 CFR
81.12.
(c) If the designated agency files a written appeal with the
Secretary, the designated agency shall send a separate copy of this
appeal to the Governor by registered or certified mail, return receipt
requested, or other means that provides a record that the Governor
received a copy of the designated agency's appeal to the Secretary.
(d) The designated agency's written appeal to the Secretary must
state why the Governor has not met the burden of showing that good
cause for the redesignation exists or has not met the procedural
requirements under Secs. 370.11 and 370.13.
(e) The designated agency's written appeal must be accompanied by
the designated agency's written response to the Governor's notice of
proposed redesignation and may be accompanied by any other written
submissions or documentation the designated agency wishes the Secretary
to consider.
(f) As part of its submissions under this section, the designated
agency may request an informal meeting with the Secretary at which
representatives of both parties will have an opportunity to present
their views on the issues raised in the appeal.
(Approved by the Office of Management and Budget under control
number 1820-0520)
(Authority: 29 U.S.C. 711(c) and 732(c)(1)(B))
Sec. 370.15 What must the Governor of a State do upon receipt of a
copy of a designated agency's written appeal to the Secretary?
(a) If the designated agency files a formal written appeal in
accordance with Sec. 370.14, the Governor shall, within 15 days of
receipt of the designated agency's appeal, submit to the Secretary
copies of the following:
(1) The written notice of proposed redesignation sent to the
designated agency.
(2) The public notice of proposed redesignation.
(3) Transcripts of all public hearings held on the proposed
redesignation.
(4) Written comments received by the Governor in response to the
public notice of proposed redesignation.
(5) The Governor's written decision to redesignate, including the
rationale for the decision.
(6) Any other written documentation or submissions the Governor
wishes the Secretary to consider.
(7) Any other information requested by the Secretary.
(b) As part of the submissions under this section, the Governor may
request an informal meeting with the Secretary at which representatives
of both parties will have an opportunity to present their views on the
issues raised in the appeal.
(Approved by the Office of Management and Budget under control
number 1820-0520)
(Authority: 29 U.S.C. 711(c) and 732(c)(1)(B))
Sec. 370.16 How does the Secretary review an appeal of a
redesignation?
(a) If either party requests a meeting under Sec. 370.14(f) or
Sec. 370.15(b), the meeting is to be held within 30 days of the
submissions by the Governor under Sec. 370.15, unless both parties
agree to waive this requirement. The Secretary promptly notifies the
parties of the date and place of the meeting.
(b) Within 30 days of the informal meeting permitted under
paragraph (a) of this section or, if neither party has requested an
informal meeting, within 60 days of the submissions required from the
Governor under Sec. 370.15, the Secretary issues to the parties a final
written decision on whether the redesignation was for good cause.
(c) The Secretary reviews a Governor's decision based on the record
submitted under Secs. 370.14 and 370.15 and any other relevant
submissions of other interested parties. The Secretary may affirm or,
if the Secretary finds that the redesignation is not for good cause,
remand for further findings or reverse a Governor's redesignation.
(d) The Secretary sends copies of the decision to the parties by
registered or certified mail, return receipt requested, or other means
that provide a record of receipt by both parties.
(Approved by the Office of Management and Budget under control
number 1820-0520)
(Authority: 29 U.S.C. 711(c) and 732(c)(1)(B))
Sec. 370.17 When does a redesignation become effective?
A redesignation does not take effect for at least 15 days following
the designated agency's receipt of the Governor's written decision to
redesignate or, if the designated agency appeals, for at least 5 days
after the Secretary has affirmed the Governor's written decision to
redesignate.
(Authority: 29 U.S.C. 711(c) and 732(c)(1)(B))
Subpart C--How Does a State Apply for a Grant?
Sec. 370.20 What must be included in a request for a grant?
(a) Each State seeking assistance under this part shall submit to
the Secretary, in writing, each fiscal year, an application that
includes, at a minimum--
(1) The name of the designated agency; and
(2) An assurance that the designated agency meets the independence
requirement of section 112(c)(1)(A) of the Act and Sec. 370.2(c), or
that the State is exempted from that requirement under section
112(c)(1)(A) of the Act and Sec. 370.2(d).
(b)(1) Each State also shall submit to the Secretary an assurance
that the designated agency has the authority to pursue legal,
administrative, and other appropriate remedies to ensure the protection
of the rights of clients or client applicants within the State.
(2) The authority to pursue remedies described in paragraph (b)(1)
of this section must include the authority to pursue those remedies
against the State vocational rehabilitation agency and other
appropriate State agencies. The designated agency meets this
requirement if it has the authority to pursue those remedies either on
its own behalf or by obtaining necessary services, such as legal
representation, from outside sources.
(c) Each State also shall submit to the Secretary assurances that--
(1) All entities conducting, administering, operating, or carrying
out programs within the State that provide services under the Act to
individuals with disabilities in the State will advise all clients and
client applicants of the existence of the CAP, the services provided
under the program, and how to contact the designated agency;
(2) The designated agency will meet each of the requirements in
this part; and
(3) The designated agency will provide the Secretary with the
annual report required by section 112(g)(4) of the Act and Sec. 370.44.
(d) To allow a designated agency to receive direct payment of funds
under this part, a State must provide to the Secretary, as part of its
application for assistance, an assurance that direct payment to the
designated agency is not prohibited by or inconsistent with State law,
regulation, or policy.
(Approved by the Office of Management and Budget under control
number 1820-0520)
(Authority: 29 U.S.C. 732 (b) and (f))
Subpart D--How Does the Secretary Allocate and Reallocate Funds to
a State?
Sec. 370.30 How does the Secretary allocate funds?
(a) The Secretary allocates the funds available under this part for
any fiscal year to the States on the basis of the relative population
of each State. The Secretary allocates at least $50,000 to each State,
unless the provisions of section 112(e)(1)(D) of the Act (which
[[Page 55771]]
provides for increasing the minimum allotment if the appropriation for
the CAP exceeds $7,500,000 or the appropriation is increased by a
certain percentage described in section 112(e)(1)(D)(ii) of the Act)
are applicable.
(b) The Secretary allocates $30,000 each, unless the provisions of
section 112(e)(1)(D) of the Act are applicable, to American Samoa,
Guam, the Virgin Islands, the Northern Mariana Islands, and the
Republic of Palau, except that the Secretary allocates to the Republic
of Palau only 75 percent of this allotment in fiscal year 1996, only 50
percent of this allotment in fiscal year 1997, only 25 percent of this
allotment in fiscal year 1998, and none of this allotment in fiscal
year 1999 and thereafter.
(c) Unless prohibited or otherwise provided by State law,
regulation, or policy, the Secretary pays to the designated agency,
from the State allotment under paragraph (a) or (b) of this section,
the amount specified in the State's approved request. Because the
designated agency is the eventual, if not the direct, recipient of the
CAP funds, 34 CFR Parts 74 and 81 apply to the designated agency,
whether or not the designated agency is the actual recipient of the CAP
grant. However, because it is the State that submits an application for
and receives the CAP grant, the State remains the grantee for purposes
of 34 CFR Parts 76 and 80. In addition, both the State and the
designated agency are considered recipients for purposes of 34 CFR Part
81.
(Authority: 29 U.S.C. 732 (b) and (e); P.L. 101-219 (Dec. 12, 1989);
P.L. 99-658 (Nov. 14, 1986); and P.L. 99-239 (Jan. 14, 1986))
Sec. 370.31 How does the Secretary reallocate funds?
(a) The Secretary reallocates funds in accordance with section
112(e)(2) of the Act.
(b) A designated agency shall inform the Secretary at least 90 days
before the end of the fiscal year for which CAP funds were received
whether the designated agency is making available for reallotment any
of those CAP funds that it will be unable to obligate in that fiscal
year.
(Approved by the Office of Management and Budget under control
number 1820-0520)
(Authority: 29 U.S.C. 711(c) and 732(e)(2))
Subpart E--What Post-Award Conditions Must Be Met by a Designated
Agency?
Sec. 370.40 What are allowable costs?
(a) If the designated agency is a State or local government agency,
the designated agency shall apply the cost principles in accordance
with 34 CFR 80.22(b).
(b) If the designated agency is a private nonprofit organization,
the designated agency shall apply the cost principles in accordance
with Subpart Q of 34 CFR Part 74.
(c) In addition to those allowable costs established in EDGAR, and
consistent with the program activities listed in Sec. 370.4, the cost
of travel in connection with the provision to a client or client
applicant of assistance under this program is allowable. The cost of
travel includes the cost of travel for an attendant if the attendant
must accompany the client or client applicant.
(d) The State and the designated agency are accountable, both
jointly and severally, to the Secretary for the proper use of funds
made available under this part. However, the Secretary may choose to
recover funds under the procedures in 34 CFR Part 81 from either the
State or the designated agency, or both, depending on the circumstances
of each case.
(Authority: 29 U.S.C. 711(c) and 732(c)(3))
Sec. 370.41 What conflict of interest provision applies to employees
of a designated agency?
(a) Except as permitted by paragraph (b) of this section, an
employee of a designated agency, of a center under contract with a
designated agency (as permitted by Sec. 370.2(f)), or of an entity or
individual under contract with a designated agency, who carries out any
CAP duties or responsibilities, while so employed, may not--
(1) Serve concurrently as a staff member of, consultant to, or in
any other capacity within, any other rehabilitation project, program,
or community rehabilitation program receiving assistance under the Act
in the State; or
(2) Provide any services under the Act, other than CAP and PAIR
services.
(b) An employee of a designated agency or of a center under
contract with a designated agency, as permitted by Sec. 370.2(f), may--
(1) Receive a traineeship under section 302 of the Act;
(2) Provide services under the PAIR program;
(3) Represent the CAP on any board or council (such as the SRAC) if
CAP representation on the board or council is specifically permitted or
mandated by the Act; and
(4) Consult with policymaking and administrative personnel in State
and local rehabilitation programs, projects, and community
rehabilitation programs, if consultation with the designated agency is
specifically permitted or mandated by the Act.
(Authority: 29 U.S.C. 732(g)(1))
Sec. 370.42 What access must the CAP be afforded to policymaking and
administrative personnel?
The CAP must be afforded reasonable access to policymaking and
administrative personnel in State and local rehabilitation programs,
projects, and community rehabilitation programs. One way in which the
CAP may be provided that access would be to include the director of the
designated agency among the individuals to be consulted on matters of
general policy development and implementation, as required by sections
101(a) (18) and (23) of the Act.
(Authority: 29 U.S.C. 721(a) (18) and (23) and 732(g)(2))
Sec. 370.43 What requirement applies to the use of mediation
procedures?
(a) Each designated agency shall implement procedures designed to
ensure that, to the maximum extent possible, good faith negotiations
and mediation procedures are used before resorting to formal
administrative or legal remedies. In designing these procedures, the
designated agency may take into account its level of resources.
(b) For purposes of this section, mediation may involve the use of
professional mediators, other independent third parties mutually agreed
to by the parties to the dispute, or an employee of the designated
agency who--
(1) Is not assigned to advocate for or otherwise represent or is
not involved with advocating for or otherwise representing the client
or client applicant who is a party to the mediation; and
(2) Has not previously advocated for or otherwise represented or
been involved with advocating for or otherwise representing that same
client or client applicant.
(Authority: 29 U.S.C. 732(g)(3))
Sec. 370.44 What reporting requirement applies to each designated
agency?
In addition to the program and fiscal reporting requirements in
EDGAR that are applicable to this program, each designated agency shall
submit to the Secretary, no later than 90 days after the end of each
fiscal year, an annual report on the operation of its CAP during the
previous year, including a summary of the work done and the uniform
statistical tabulation of all cases handled by the program. The annual
report must contain information on--
[[Page 55772]]
(a) The number of requests received by the designated agency for
information on services and benefits under the Act and Title I of the
ADA;
(b) The number of referrals to other agencies made by the
designated agency and the reason or reasons for those referrals;
(c) The number of requests for advocacy services received by the
designated agency from clients or client applicants;
(d) The number of the requests for advocacy services from clients
or client applicants that the designated agency was unable to serve;
(e) The reasons that the designated agency was unable to serve all
of the requests for advocacy services from clients or client
applicants; and
(f) Any other information that the Secretary may require.
(Approved by the Office of Management and Budget under control
number 1820-0520)
(Authority: 29 U.S.C. 732(g) (4) and (5))
Sec. 370.45 What limitation applies to the pursuit of legal remedies?
A designated agency may not bring any class action in carrying out
its responsibilities under this part.
(Authority: 29 U.S.C. 732(d))
Sec. 370.46 What consultation requirement applies to a Governor of a
State?
In designating a client assistance agency under Sec. 370.2,
redesignating a client assistance agency under Sec. 370.10(a), and
carrying out the other provisions of this part, the Governor shall
consult with the director of the State vocational rehabilitation agency
(or, in States with both a general agency and an agency for the blind,
the directors of both agencies), the head of the developmental
disability protection and advocacy agency, and representatives of
professional and consumer organizations serving individuals with
disabilities in the State.
(Authority: 29 U.S.C. 732(c)(2))
Sec. 370.47 When must grant funds be obligated?
(a) Any funds appropriated for a fiscal year to carry out the CAP
that are not expended or obligated by the designated agency prior to
the beginning of the succeeding fiscal year remain available for
obligation by the designated agency during the succeeding fiscal year
in accordance with 34 CFR 76.705 through 76.707.
(b) A designated agency shall inform the Secretary within 90 days
after the end of the fiscal year for which the CAP funds were made
available whether the designated agency carried over to the succeeding
fiscal year any CAP funds that it was unable to obligate by the end of
the fiscal year.
(Approved by the Office of Management and Budget under control
number 1820-0520)
(Authority: 29 U.S.C. 718)
Sec. 370.48 What are the special requirements pertaining to the
protection, use, and release of personal information?
(a) All personal information about individuals served by any
designated agency under this part, including lists of names, addresses,
photographs, and records of evaluation, must be held strictly
confidential.
(b) The designated agency's use of information and records
concerning individuals must be limited only to purposes directly
connected with the CAP, including program evaluation activities. Except
as provided in paragraphs (c) and (e) of this section, this information
may not be disclosed, directly or indirectly, other than in the
administration of the CAP, unless the consent of the individual to whom
the information applies, or his or her parent, legal guardian, or other
legally authorized representative or advocate (including the
individual's advocate from the designated agency), has been obtained in
writing. A designated agency may not produce any report, evaluation, or
study that reveals any personally identifying information without the
written consent of the individual or his or her representative.
(c) Except as limited in paragraphs (d) and (e) of this section,
the Secretary or other Federal or State officials responsible for
enforcing legal requirements are to have complete access to all--
(1) Records of the designated agency that receives funds under this
program; and
(2) All individual case records of clients served under this part
without the consent of the client.
(d) For purposes of conducting any periodic audit, preparing or
producing any report, or conducting any evaluation of the performance
of the CAP established or assisted under this part, the Secretary does
not require the designated agency to disclose the identity of, or any
other personally identifiable information related to, any individual
requesting assistance under the CAP.
(e) Notwithstanding paragraph (d) of this section and consistent
with paragraph (f) of this section, a designated agency shall disclose
to the Secretary, if the Secretary so requests, the identity of, or any
other personally identifiable information (i.e., name, address,
telephone number, social security number, or any other official code or
number by which an individual may be readily identified) related to,
any individual requesting assistance under the CAP if--
(1) An audit, evaluation, monitoring review, State plan assurance
review, or other investigation produces reliable evidence that there is
probable cause to believe that the designated agency has violated its
legislative mandate or misused Federal funds; or
(2) The Secretary determines that this information may reasonably
lead to further evidence that is directly related to alleged misconduct
of the designated agency.
(f) In addition to the protection afforded by paragraph (d) of this
section, the right of a person or designated agency not to produce
documents or disclose information to the Secretary is governed by the
common law of privileges, as interpreted by the courts of the United
States.
(Authority: 29 U.S.C. 711(c) and 732(g)(6))
[FR Doc. 95-27169 Filed 11-1-95; 8:45 am]
BILLING CODE 4000-01-P
