[Federal Register Volume 59, Number 45 (Tuesday, March 8, 1994)]
[Unknown Section]
[Page 0]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-5190]


[[Page Unknown]]

[Federal Register: March 8, 1994]


_______________________________________________________________________

Part VII





Department of Education





_______________________________________________________________________



34 CFR Parts 75 and 693




Direct Grant Programs; National Early Intervention Scholarship and 
Partnership Program; Proposed Rule
DEPARTMENT OF EDUCATION

34 CFR Parts 75 and 693

RIN 1840-AB79

 
Direct Grant Programs; National Early Intervention Scholarship 
and Partnership Program

AGENCY: Department of Education.

ACTION: Notice of proposed rulemaking.

-----------------------------------------------------------------------

SUMMARY: The Secretary proposes regulations to implement the new 
National Early Intervention Scholarship and Partnership (NEISP) Program 
in accordance with the provisions in chapter 2, subpart 2, part A, 
title IV, of the Higher Education Amendments of 1992, enacted July 23, 
1992, (Pub. L. 102-325) (1992 amendments), which amended the Higher 
Education Act of 1965 (HEA). These proposed regulations for the NEISP 
Program specify the role of the Secretary and the responsibilities of 
the States in the administration of the program. The proposed 
regulations also specify the State and student applicant eligibility 
requirements and the criteria by which the Secretary approves a State's 
application to participate in the program.

DATES: Comments must be received on or before April 7, 1994.

ADDRESSES: All comments concerning these proposed regulations should be 
addressed to Fred H. Sellers, U.S. Department of Education, 400 
Maryland Avenue, SW., room 4018, ROB-3, Washington, DC 20202-5447.
    A copy of any comments that concern information collection 
requirements also should be sent to the Office of Management and Budget 
at the address listed in the Paperwork Reduction Act section of this 
preamble.

FOR FURTHER INFORMATION CONTACT: Daniel Sullivan, U.S. Department of 
Education, 400 Maryland Avenue, SW., room 4018, ROB-3, Washington, DC 
20202-5447. Telephone: (202) 708-4607. Individuals who use a 
telecommunications device for the deaf (TDD) may call the Federal 
Information Relay Service (FIRS) at 1-800-877-8339 between 8 a.m. and 8 
p.m., Eastern time, Monday through Friday.

SUPPLEMENTARY INFORMATION: The Secretary proposes regulations to 
implement the National Early Intervention Scholarship and Partnership 
(NEISP) Program, a new program authorized under the amended HEA. The 
Secretary also proposes a technical amendment to insert a reference to 
the NEISP Program into 34 CFR 75.60 of the regulations for the Direct 
Grant Programs. The Secretary proposes to make technical amendments in 
a separate notice of proposed rulemaking to insert references to the 
NEISP Program into the appropriate sections of 34 CFR part 668 of the 
Student Assistance General Provisions regulations. The NEISP Program 
provides States with Federal financial incentives to establish or 
maintain a program with matching State-originated funds. It provides 
for: (1) A scholarship component that, to the extent possible, 
guarantees the financial assistance necessary for eligible low-income 
students who graduate from high school to attend an institution of 
higher education, and (2) an early intervention component that uses 
State-wide resources, both government and private, to provide 
additional counseling, financial aid counseling, mentoring, academic 
support, outreach, and supportive services to preschool, elementary, 
middle, and secondary school students who are at risk of dropping out 
of school. These proposed regulations specify the role of the Secretary 
and the responsibilities of the States in administering the NEISP 
Program. The proposed regulations also specify State and student 
applicant eligibility requirements and the criteria by which the 
Secretary approves a State's plan for participating in the program.
    Section 404C of the amended HEA provides that a participating State 
shall demonstrate to the satisfaction of the Secretary that the State 
will provide comprehensive mentoring, tutoring, outreach, and other 
academic and counseling services to students participating in programs 
under this chapter who are enrolled in preschool through grade 12. The 
Secretary believes that these services should be provided as early in a 
student's schooling as necessary to be effective. By way of example, 
some currently successful programs begin with classroom students at the 
preschool or elementary school level. However, in order to provide 
services at any point in a student's education, under this program the 
Congress also permits a State to assist students through the twelfth 
grade, including pre-freshman summer programs. The Secretary finds that 
a State should take into account existing comparable services within 
the State to avoid duplicating existing administrative entities and 
services. Therefore, under Sec. 693.20(h) of the proposed regulations, 
when establishing its early intervention component, a State would be 
required to coordinate its efforts with existing Federal, State, local 
and private programs offering these services; for example, the Talent 
Search, Upward Bound, and Student Support Services programs and 
Educational Opportunity Centers, collectively known as the Federal TRIO 
programs.
    The NEISP Program's early intervention component supports National 
Education Goals 2 (High School Completion), 3 (Student Achievement and 
Citizenship), and 4 (Science and Mathematics). The NEISP Program's 
scholarship component also supports National Education Goal 5 (Adult 
Literacy and Lifelong Learning).
    Some areas in which the proposed regulations clarify or amplify the 
statutory requirements are explained below.

Definitions

    Section 693.5(b) of the proposed NEISP Program regulations defines 
the terms ``academic year,'' ``award year,'' and ``institution of 
higher education'' as they are defined in section 481 of the HEA. These 
amendments to section 481 of the HEA require that the Secretary amend 
definitions in the Student Assistance General Provisions regulations in 
34 CFR part 668. When the Secretary publishes final regulations 
amending these definitions, he also will amend the definitions in 
Sec. 693.5(b) in the NEISP Program regulations to reference those 
changes.

Name of State Program

    Under Sec. 693.10(b)(2) of the proposed regulations, the Secretary 
proposes to require that each State desiring to participate in the 
program must, as a part of its plan to carry out the program, agree to 
name its State program the ``[State name] National Early Intervention 
Scholarship and Partnership Program,'' which can be referred to as the 
``[State name] NEISP Program,'' and to name recipients of scholarships 
as ``[State name] National Partnership Scholars.'' These requirements 
are in accord with the changes made in the 1992 amendments that require 
recipients of title IV, HEA student financial assistance to understand 
clearly that they are recipients of financial assistance provided by 
the Federal Government. In addition, the Secretary believes that naming 
recipients ``[State name] National Partnership Scholars'' will enhance 
student motivation and participation in the program by providing the 
prestige and recognition of a student's accomplishments that are 
associated with being a recipient of a national scholarship.

State Plan and Application

    Section 404B of the amended HEA requires each State to submit a 
plan to the Secretary for review and approval that describes how the 
State will carry out the NEISP Program. The plan, as described in the 
program statute, prescribes the information and data each State must 
submit to the Secretary in order for the Secretary to approve the 
State's participation in the NEISP Program. The Secretary finds that, 
while some of the information required under section 404B will have to 
be submitted each year the State participates in the program, a 
significant amount of the information and data required for the State 
plan will have to be reported only once, in the initial fiscal year 
that the State wants to participate in the program. Under the proposed 
regulations, once a State plan has been approved by the Secretary, in 
subsequent fiscal years the State will not be required to submit a 
State plan for the review and approval of the Secretary unless the 
State, at its own initiative or the Secretary's initiative, must make 
changes to the previously approved State plan.
    Therefore, to simplify and reduce the amount of reporting burden on 
the States, the Secretary proposes the following--


    (1) For the first fiscal year that a State wants to participate 
in the NEISP Program, a State shall submit to the Secretary a one-
time State plan containing all the information and data required 
under Secs. 693.10, 693.11, 693.12, 693.13, and 693.20 of the 
proposed regulations; and
    (2) In each subsequent fiscal year that a State wants to 
continue to participate in the NEISP Program, the State shall submit 
for the review and approval of the Secretary an annual application 
containing the information and data as required under Sec. 693.13 of 
the proposed regulations.

State Agency Responsible for Administering the Program

    Under the plan to administer the program required by section 404B 
of the amended HEA, the Secretary proposes in Sec. 693.10(b)(1) that 
the Governor of each State designate the State agency that will be 
responsible for carrying out the NEISP Program. In doing so the 
Governor must designate the State agency that administers the State 
Student Incentive Grant (SSIG) Program, the State educational agency, 
or another agency that the Secretary approves. The Secretary believes 
that requiring the Governor of a State to designate an agency within 
his or her State to be responsible for the NEISP Program will ensure 
that program funds are allocated to an appropriate and responsible 
State agency and is consistent with other Federal and State-
administered student financial aid programs, such as the SSIG Program.

Federal Funds Supplementing, Not Supplanting, State and Local Funds

    Section 404B(b)(3) of the amended HEA requires each State in its 
State plan to propose provisions designed to assure the Secretary that 
funds provided under this part will supplement and not supplant funds 
expended for existing State and local early intervention and 
postsecondary education scholarship programs. Under Sec. 693.13(a)(4), 
the Secretary proposes that on its annual application each State 
provide the supporting documentation to assure the Secretary that the 
amount of funds the State is projecting to provide under its NEISP 
Program for that fiscal year exceeds the amount of funds the State 
expended for State and local early intervention programs and State 
need- and non-need-based student financial grant assistance programs 
during the fiscal year two years prior to the fiscal year in which the 
State first received funds under this program.

Allotment Requirements

    Section 404B(d) of the amended HEA requires that from the State's 
allotment calculated under section 404D, the Secretary shall disburse 
an amount to each State equal to no more than one-half of the total 
amount the State documented that it expended on its NEISP Program for 
the same fiscal year. The Secretary proposes to collect that 
expenditure information from each participating State by means of an 
annual performance report, authorized under 34 CFR 80.40 of the 
Education Department General Administrative Regulations, to be 
submitted after the end of each NEISP Program award year.
    However, to be able to allot funds to eligible States at the 
beginning of each award year, under Sec. 693.21(b) of the proposed 
regulations the Secretary will disburse to each eligible State an 
amount from that State's allotment equal to not more than one-half of 
the total amount of funds from all sources the State projects that it 
will expend on its NEISP Program for the fiscal year as reported on its 
annual application under Sec. 693.13(a) of the proposed regulations. 
Under Sec. 693.21(c) of the proposed regulations, when the Secretary 
disburses an NEISP Program allotment to a State on the basis of the 
total funds the State projects that it will expend on the NEISP Program 
in a fiscal year, the State may actually expend from its Federal 
allotment no more than one-half of the total amount of funds the State 
actually expends under its NEISP Program for that fiscal year.

Uses of Funds

    Section 404C(b)(1) of the amended HEA requires that the Secretary 
shall establish by regulation criteria for determining whether 
comprehensive mentoring, counseling, outreach, and supportive services 
programs may be used to meet the requirements in section 404C(a) of the 
amended HEA. The Secretary proposes to provide that information in 
Secs. 693.11, 693.13, and 693.20 of these proposed regulations.

Scholarship Funds

    There is no provision for an administrative cost allowance under 
the scholarship component of the NEISP Program. Therefore, each 
participating State shall expend all Federal and State matching funds 
in the NEISP Program's scholarship component on scholarship assistance 
for NEISP Scholars.

Scholarship Amount

    Section 404D(b) provides a formula for a minimum scholarship amount 
to be awarded to each recipient and also requires each participating 
State to establish its own maximum scholarship amount. The maximum 
scholarship amount, however, may not, when combined with a student's 
Federal Pell Grant award, all other Federal student financial 
assistance, and any other grant or scholarship assistance, exceed the 
student's cost of attendance. The Secretary proposes to implement these 
requirements under Sec. 693.12 (e) and (g) of the proposed regulations.

Priority on Awarding Scholarships to Recipients of Federal Pell 
Grants

    Section 404D(e) of the program statute requires that the Secretary 
ensure that each State place a priority on awarding NEISP Program 
scholarships to recipients of Federal Pell Grants. The Secretary 
proposes to implement this requirement in Secs. 693.3(b) and 693.12(c) 
of these regulations. Under Sec. 693.3(b), the Secretary believes that 
requiring States to award NEISP Program scholarships to low-income 
students attending institutions of higher education participating in 
the Federal Pell Grant Program helps ensure that States will place a 
priority on awarding NEISP Program scholarships to Federal Pell Grant 
recipients. The Secretary believes that the majority of institutions of 
higher education that participate in the Federal student financial 
assistance programs are participating in the Federal Pell Grant 
Program. As a result, the Secretary believes that requiring NEISP 
Program scholarships be awarded to students attending institutions 
participating in the Federal Pell Grant Program will not unfairly limit 
educational options to NEISP scholarship recipients.
    Under Sec. 693.12(c) of the proposed regulations, the Secretary is 
ensuring that States place first priority on awarding NEISP Program 
scholarships to Federal Pell Grant recipients by requiring the States 
to award NEISP Program scholarships to students who have the most 
financial need as demonstrated by having the lowest expected family 
contributions and who also are recipients of Federal Pell Grant awards. 
The Secretary believes that these proposed regulatory requirements, 
while not specifically required under the statute, are consistent with 
the intent of the program.

Targeting Early Intervention Services to Priority Students

    Section 404C(a) of the program statute requires a State to 
demonstrate to the Secretary the methods by which the State will target 
services on priority students. The Secretary proposes to implement this 
requirement in Sec. 693.20(a)(2)(v) of these regulations. The Secretary 
plans to provide States with extensive flexibility in adopting methods 
for targeting services on priority students. A State must provide in 
its State plan a clear description of the methods a State will use to 
target services to priority students. Methods proposed by the State 
must be based on the latest available State data. Methods for targeting 
services on priority students may include targeting by elementary and 
secondary schools with high concentrations of priority students within 
the State, by appropriate identifiable geographic areas such as 
counties or school districts (including both public and private 
schools) with high concentrations of priority students within the 
State, or by other methods proposed by a State and approved by the 
Secretary.

Discretionary Grant Competition

    Section 404E(a) of the program statute requires the Secretary to 
award grant funds to States under this program on a competitive basis 
if the program appropriation for a fiscal year is less than 
$50,000,000. The Secretary proposes to implement this requirement in 
Sec. 693.22 of these regulations.
    The Secretary proposes to conduct a grant competition for the 
States by means of a notice published annually in the Federal Register 
that contains the information needed by a State to apply for funds 
under a discretionary NEISP Program competition. The Secretary 
evaluates a State's application for funds under a discretionary NEISP 
Program competition on the basis of the extent to which the State 
fulfills the requirements listed in Secs. 693.10, 693.11, 693.12, 
693.13, and 693.20 and the selection criteria with point values listed 
for each criterion in Sec. 693.22. '
    The Secretary is seeking to select the best possible State programs 
for the limited amount of discretionary grant funding available. 
Therefore, the Secretary believes that, if two States have similarly 
rated applications, the tiebreaker criteria in Sec. 693.22(c)(4) 
(comprehensive State-wide early intervention and postsecondary 
educational scholarship program, comprehensive long-term mentoring and 
advising, and State grant funds for students' postsecondary education) 
are essential elements for States to provide to fulfill the purposes of 
the program.
    The Secretary believes that equivalent selection criteria in 
Sec. 693.22 for the scholarship component are unnecessary. The program 
statute and Secs. 693.10 and 693.12 of the proposed regulations provide 
States with sufficient information concerning the scholarship component 
requirements and how ED will review and approve a State's plan and 
application under a discretionary grant competition. However, the 
Secretary notes that he has included in the selection criteria in 
Sec. 693.22 consideration of availability of State grant aid available 
to National Partnership Scholars if the scholarship component is not 
funded. Further, the Secretary is requesting comment concerning the 
extent to which he should require State standards or guidelines to 
ensure that State scholarships will support and be available to 
eligible students for an extended period.

Evaluation Report

    Section 404F of the program statute requires each State receiving 
an allotment under this part to prepare and submit to the Secretary 
every two years an evaluation of the early intervention component of 
its NEISP Program. The Secretary proposes to implement this requirement 
in Sec. 693.52 of these regulations. The report must summarize and 
evaluate the States' activities under the program and the performance 
of the student participants. Each State's evaluation report design must 
include measures that permit the State to track all participating 
students' progress throughout each student's participation in the 
program.
    The biennial evaluation report of the early intervention component 
of the program must at a minimum include, but is not limited to, 
information on the program objectives that produce useful data and that 
are quantifiable; the effectiveness of the State's program in meeting 
the purposes of the program; the effect of the program on the student 
recipients being served by the program, including measurable outcomes 
such as improved academic performance, increased postsecondary 
educational enrollment and retention, increased elementary and 
secondary school grade retention, reduced elementary and secondary 
school dropout rates, and reduced financial barriers to attendance at 
institutions of higher education; the barriers to the effectiveness of 
the program and recommendations for changes or improvements to the 
program; the cost-effectiveness of the program; the extent to which the 
student recipients comply with the requirements of the program; key 
program information listed on an annual and biennial basis; other 
pertinent program measurements concerning the early intervention 
component that the State believes would be useful to the Secretary, 
which may be displayed through analytical charts, tables, and graphs; 
and any other information required by the Secretary to carry out the 
evaluation report function.

Allowable and Nonallowable Costs

    The proposed allowable and nonallowable costs in Secs. 693.50 and 
693.51 are consistent with similar programs such as the Federal TRIO 
(e.g., Upward Bound, Educational Opportunity Centers, Student Support 
Services) programs.

Executive Order 12866

    These proposed 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 proposed regulations are 
those resulting from statutory requirements and those determined by the 
Secretary to be necessary for administering this program effectively 
and efficiently. Burdens specifically associated with information 
requirements, if any, are identified and explained elsewhere in this 
preamble under the heading

Paperwork Reduction Act of 1980

    In assessing the potential costs and benefits--both quantitative 
and qualitative--of these proposed regulations, the Secretary has 
determined that the benefits of the proposed regulations justify the 
costs.
    The Secretary has also determined that this regulatory action does 
not unduly interfere with State, local, and tribal governments in the 
exercise of their governmental functions.
    To assist the Department in complying with the specific 
requirements of Executive Order 12866, the Secretary invites comment on 
whether there may be further opportunities to reduce any potential 
costs or increase potential benefits resulting from these proposed 
regulations without impeding the effective and efficient administration 
of the program.

Regulatory Flexibility Act Certification

    The Secretary certifies that these proposed regulations would not 
have a significant economic impact on a substantial number of small 
entities. Because these proposed regulations would affect only States 
and State agencies, the regulations would not affect small entities. 
State and State agencies are not ``small entities'' under the 
Regulatory Flexibility Act.

Paperwork Reduction Act of 1980

    Sections 693.10, 693.11, 693.12, 693.13, 693.20, 693.22, and 693.52 
of the NEISP Program proposed regulations contain information 
collection requirements. As required by the Paperwork Reduction Act of 
1980, the Department of Education will submit a copy of these sections 
to the Office of Management and Budget (OMB) for its review. (44 U.S.C. 
3504(h))
    The public reporting burden for the information collection required 
under Secs. 693.10, 693.11, 693.12, 693.13, 693.20, and 693.22 of these 
proposed regulations is estimated to average 1,400 hours per State 
response for approximately 57 respondents for a total burden of 79,800 
hours for the first year of participation by all States. The reporting 
burden for the information collection required under Sec. 693.52 of 
these proposed regulations is estimated to average 1 hour per State 
response for approximately 57 respondents for a total burden of 57 
hours.
    Organizations and individuals desiring to submit comments on the 
information collection requirements contained in these proposed 
regulations should direct them to the Office of Information and 
Regulatory Affairs, OMB, room 3002, New Executive Office Building, 
Washington, DC 20503; Attention: Daniel J. Chenok.

Intergovernmental Review

    The NEISP 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 proposed Federal 
financial assistance.
    In accordance with the order, this document is intended to provide 
early notification of the Department's specific plans and actions for 
the NEISP Program.

Invitation to Comment

    Interested persons are invited to submit comments and 
recommendations regarding these proposed regulations.
    All comments submitted in response to these proposed regulations 
will be available for public inspection, during and after the comment 
period, in room 4018, ROB-3, 7th and D Streets, SW., Washington, DC, 
between the hours of 8:30 a.m. and 4 p.m., Monday through Friday of 
each week except Federal holidays.

Assessment of Educational Impact

    The Secretary particularly requests comments on whether the 
proposed regulations in this document would 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 75

    Education Department, Grant programs--education, Grant 
administration.

List of Subjects in 34 CFR Part 693

    Grant programs--education, Postsecondary education, State 
administered--education, Student Aid--education, Reporting and 
recordkeeping requirements.

    Dated: February 28, 1994.
Richard W. Riley,
Secretary of Education.

(Catalog of Federal Domestic Assistance Number 84.272, National 
Early Intervention Scholarship and Partnership Program)

    The Secretary proposes to amend Title 34 of the Code of Federal 
Regulations by amending part 75 and by adding a new part 693 as 
follows:

PART 75--DIRECT GRANT PROGRAMS

    1. The authority citation for part 75 continues to read as follows:

    Authority: 20 U.S.C. 1221e-3(a)(1) and 3474, unless otherwise 
noted.


Sec. 75.60  [Amended]

    2. In Sec. 75.60, paragraph (b)(1) is amended by adding the term 
``National Early Intervention Scholarship and Partnership (NEISP) 
Program (20 U.S.C. 1070a-21, et seq.),'' after ``(20 U.S.C. 1070a, et 
seq.),''.
    3. A new part 693 is added to read as follows:

PART 693--NATIONAL EARLY INTERVENTION SCHOLARSHIP AND PARTNERSHIP 
PROGRAM

Subpart A--General

Sec.
693.1  What is the National Early Intervention Scholarship and 
Partnership Program?
693.2  Who is eligible to participate under this program?
693.3  What kinds of activities may be assisted under this program?
693.4  What regulations apply to this program?
693.5  What definitions apply to this program?

Subpart B--How Does a State Obtain a Grant?

693.10  What must a State do to obtain a grant under this program?
693.11  What requirements must be met by the State under the 
program's early intervention component?
693.12  What requirements must be met by the State under the 
program's scholarship component?
693.13  What information must a State provide in its annual 
application to receive a grant under the NEISP Program?

Subpart C--How Does the Secretary Make a Grant to a State?

693.20  What criteria does the Secretary use to determine whether a 
State's proposed early intervention component meets the requirements 
under this program?
693.21  How does the Secretary allot funds to a State?
693.22  How does the Secretary allot funds to States on a 
competitive basis?
Subpart D--How Does a Student Participate in the Early Intervention 
Component under the NEISP Program?
693.30  What are the requirements for a student to be a participant 
in the early intervention component of this program?
Subpart E--How Does a State Award a Scholarship to a Student?
693.40  What are the requirements for a student to receive a 
scholarship under this program?
Subpart F--What Postaward Conditions Must Be Met by a State?
693.50  What are allowable costs attributable to administration of 
the early intervention component?
693.51  What are nonallowable costs that may not be charged to 
administration of the early intervention component?
693.52  What requirements must a State meet in preparing and 
submitting an evaluation report?

    Authority: 20 U.S.C. 1070a-21 through 1070a-27, unless otherwise 
noted.

Subpart A--General


Sec. 693.1  What is the National Early Intervention Scholarship and 
Partnership Program?

    Under the National Early Intervention Scholarship and Partnership 
(NEISP) Program, the Secretary provides grants to States to--
    (a) Encourage the States to provide or maintain a guaranteed amount 
of financial assistance necessary to permit eligible low-income 
students who obtain high school diplomas or the equivalent to attend an 
institution of higher education; and
    (b) Provide financial incentives to enable States, in cooperation 
with local educational agencies, institutions of higher education, 
community organizations, and businesses, to provide--
    (1) Additional counseling, mentoring, academic support, outreach, 
and supportive services to preschool, elementary, middle, and secondary 
school students who are at risk of dropping out of school; and
    (2) Information to students and their parents about the advantages 
of obtaining a postsecondary education and their college financing 
options.

(Authority: 20 U.S.C. 1070a-21)


Sec. 693.2  Who is eligible to participate under this program?

    (a) States that meet the requirements of Secs. 693.10, 693.11, 
693.12, 693.13, 693.20, 693.21, and 693.22 are eligible to receive 
grants under this program.
    (b) Under the early intervention component, students who meet the 
requirements of Sec. 693.30 are eligible to participate in the State-
administered programs under this part.
    (c) Under the scholarship component, students who meet the 
requirements of Sec. 693.40 are eligible to receive scholarships from 
States under this program.

(Authority: 20 U.S.C. 1070a-22 to 1070a-24)


Sec. 693.3  What kinds of activities may be assisted under this 
program?

    Under the NEISP Program, a State may use its allotment under 
Sec. 693.21 or Sec. 693.22 to--
    (a) Provide a variety of early intervention services such as 
comprehensive mentoring, counseling, outreach, and other supportive 
services to eligible students enrolled in preschool through grade 12, 
including pre-freshman summer programs; and
    (b) Award scholarships to eligible low-income students for 
attendance at any institution of higher education participating in the 
Federal Pell Grant Program.

(Authority: 20 U.S.C. 1070a-22 to 1070a-24)


Sec. 693.4  What regulations apply to this program?

    The following regulations apply to the NEISP Program:
    (a) The regulations in this part 693.
    (b) The Education Department General Administrative Regulations 
(EDGAR) as follows:
    (1) If the amount appropriated for the program is less than 
$50,000,000, 34 CFR part 75 (Direct Grant Programs).
    (2) If the amount appropriated for the program is $50,000,000 or 
more, 34 CFR part 76 (State-Administered Programs).
    (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).
    (6) 34 CFR part 82 (New Restrictions on Lobbying).
    (7) 34 CFR part 85 (Governmentwide Debarment and Suspension 
(Nonprocurement) and Governmentwide Requirements for Drug-Free 
Workplace (Grants).
    (8) 34 CFR part 86 (Drug-Free Schools and Campuses).
    (c) Institutional Eligibility Under the Higher Education Act of 
1965, as Amended in 34 CFR part 600.
    (d) The Student Assistance General Provisions in 34 CFR part 668.

(Authority: 20 U.S.C. 1070a-21 through 1070a-27)


Sec. 693.5  What definitions apply to this program?

    (a) Definitions in EDGAR. The following terms used in this part are 
defined in 34 CFR 77.1:

Applicant
Application
Award
Budget
Budget Period
Department
Elementary school
Fiscal Year
Grant
Grantee
Local educational agency (LEA)
Private
Project
Project Period
EDGAR
Secretary
State

    (b) Definitions in Section 481 (a) and (d) of the HEA. The 
following terms used in this part are defined in section 481 of the 
HEA:

Academic year
Award year
Institution of higher education

    (c) Definitions in subpart A of the Institutional Eligibility 
regulations, 34 CFR 600.1. The following term used in this part is 
defined in 34 CFR 600.1:

Recognized equivalent of a high school diploma

    (d) Other definitions that apply to this part. The following 
definitions also apply to this part:
    At-risk student means a preschool through grade 12 student whom a 
State identifies as being a potential dropout from secondary or 
postsecondary school.
    Disadvantaged student means a student who is either
    (1) A low-income individual who is also a first-generation college 
student; or
    (2) A student with disabilities.
    Early intervention program means a program that provides education-
related activities such as counseling, mentoring, academic support, 
outreach, and other supportive services, including providing 
information on opportunities for postsecondary student financial aid, 
to students enrolled in preschool through grade 12.
    First-generation college student means--
    (1) A student neither of whose parents completed a baccalaureate 
degree; or
    (2) A student who regularly resides with and receives support from 
only one parent who did not complete a baccalaureate degree.
    HEA means the Higher Education Act of 1965, as amended.
    Limited proficiency in English with reference to an individual, 
means an individual--
    (1)(i) Who was not born in the United States;
    (ii) Whose native language is other than English;
    (iii) Who comes from an environment in which a language other than 
English is most relied on for communication; or
    (iv) Who is an American Indian or Alaskan Native student and comes 
from an environment in which a language other than English has had a 
significant impact on his or her level of proficiency in English; and
    (2) Who, as a result of the circumstances described in paragraph 
(1) of this definition, is unable to learn successfully in classrooms 
in which instruction is in English because he or she cannot adequately 
understand, speak, read, or write English.
    Low-income individual means an individual whose taxable family 
income for the year before the year in which he or she is scheduled to 
receive assistance under this part did not exceed 150 percent of an 
amount equal to the poverty level determined by using criteria of 
poverty established by the U.S. Bureau of the Census or a resident who 
is considered to be a low-income resident by the State in which he or 
she lives.
    Postsecondary education means a program of education beyond the 
secondary school level.
    Priority student means any student within a State in preschool 
through grade 12 who is eligible--
    (1) To be counted as attending an institution receiving Federal 
funds under chapter 1 of the Elementary and Secondary Education Act of 
1965;
    (2) To receive free or reduced-price meals under the National 
School Lunch Act; or
    (3) To receive assistance under the Aid to Families with Dependent 
Children Act.
    Scholarship means an award made to an individual under this part.
    Secondary school, as defined under section 1471(21) of the 
Elementary and Secondary Education Act of 1965, means a day or 
residential school that provides secondary education, as determined 
under State law, except that it does not include any education beyond 
grade 12.
    State educational agency (SEA), as defined under section 1471(23) 
of the Elementary and Secondary Education Act of 1965, means the 
officer or agency primarily responsible for the State supervision of 
public elementary and secondary schools.
    Student with a disability, as defined in section 3(2) of the 
Americans with Disabilities Act of 1990 (42 U.S.C. 12102(2)), means a 
student with a physical or mental impairment that substantially limits 
one or more of the major life activities of the student and thus 
requires special education and related services.

(Authority: 20 U.S.C. 1070a-21 through 1070a-27)

Subpart B--How Does a State Obtain a Grant?


Sec. 693.10  What must a State do to obtain a grant under this program?

    (a) To obtain a grant, a State shall submit to the Secretary for 
review and approval an initial plan and annual application for carrying 
out the activities under the NEISP Program.
    (b) The Secretary approves a State plan that--
    (1) By direction of the State's Governor, designates as the State 
agency for administering the program under this part, either--
    (i) The State agency that administers the State Student Incentive 
Grant Program under title IV, part A, subpart 4 of the HEA;
    (ii) The State educational agency; or
    (iii) Another appropriate State agency approved by the Secretary;
    (2) Provides that the State program under this part shall be known 
as the ``[insert name of the State] National Early Intervention 
Scholarship and Partnership Program'' which may be referred to as the 
``[State name] NEISP Program,'';
    (3) Demonstrates to the satisfaction of the Secretary that the 
State will provide for the conduct under the State's NEISP Program of 
both--
    (i) An early intervention component meeting the requirements under 
Sec. 693.11 as evaluated by the Secretary under the criteria in 
Sec. 693.20; and
    (ii) A scholarship component meeting the requirements under 
Sec. 693.12;
    (4) Describes the administrative plan for implementing the State's 
NEISP Program, including those functions that will be carried out by 
public and private organizations; and
    (5) Provides assurances that the State will--
    (i) Ensure that the funds provided under this part supplement and 
do not supplant funds expended for State and local early intervention 
programs and State need- and non-need-based student financial grant 
assistance programs during the fiscal year 2 years prior to the fiscal 
year in which the State first received funds under this program;
    (ii) Expend, from State, local, or private funds or other 
acceptable funding methods, not less than one-half of the cost of the 
program under this part;
    (iii) Specify the methods by which such share of the costs will be 
paid;
    (iv) Not use less than 25 percent or more than 50 percent of its 
total NEISP Program funds for the early intervention component, unless 
the State can satisfactorily demonstrate in its plan submitted to the 
Secretary that the State has additional means to provide scholarships 
to students, in accordance with the waiver provision in Sec. 693.13(b);
    (v) Expend all of the NEISP Program funds under the scholarship 
component only to provide scholarships to eligible students; and
    (vi) Conduct and submit to the Secretary a biennial evaluation of 
the early intervention program assisted under this part in accordance 
with the requirements in Sec. 693.52.
    (c) With the exception of its initial year of participation when 
each State also must submit the application required under Sec. 693.13 
at the same time as the State plan under paragraph (b) of this section, 
the State shall submit annually an application to participate in the 
NEISP Program in accordance with the requirements in Sec. 693.13.

(Authority: 20 U.S.C. 1070a-22 and 1070a-26)


Sec. 693.11  What requirements must be met by the State under the 
program's early intervention component?

    (a) A State shall demonstrate to the Secretary in its plan 
submitted according to Sec. 693.10(b) how its early intervention 
component provides services designed to meet the unique needs of the 
State's eligible students enrolled in preschool through grade 12, 
including, but not limited to, the following kinds of activities--
    (1) A continuing system of mentoring and advising that--
    (i) Is coordinated with the Federal and State community service 
initiatives; and
    (ii) Includes such support services as--
    (A) Instruction in reading, writing, study skills, mathematics, and 
other subjects necessary for success in education beyond secondary 
school;
    (B) After-school and summer tutoring;
    (C) Assistance in obtaining summer jobs;
    (D) Career mentoring;
    (E) Academic counseling and assistance in secondary school course 
selection;
    (F) Financial aid counseling that provides information on the 
opportunities for postsecondary student financial assistance;
    (G) Instruction designed to prepare students participating in the 
program for careers in which students from disadvantaged backgrounds 
are particularly underrepresented, as determined by the State; and
    (H) Programs and activities specifically designed for students with 
limited proficiency in English.
    (2) Activities designed to ensure high school completion and 
college enrollment of at-risk students by providing, in addition to the 
activities specified under paragraph (a) of this section, the 
following:
    (i) Assessment to identify at-risk students.
    (ii) Skills assessment.
    (iii) Activities to encourage volunteer and parent involvement in 
the activities planned under this section.
    (iv) Programs that involve the participation of former or current 
scholarship recipients as mentors or peer counselors.
    (v) Personal and family counseling, including home visits.
    (vi) Staff development to provide the services under this part.
    (3) Activities that encourage students to complete secondary school 
and pursue postsecondary education by requiring each student to enter 
into an agreement under which the State will provide postsecondary 
tuition assistance to a student, during a period of time to be 
established by the State, if the student agrees to achieve certain 
academic milestones, such as--
    (i) Completing the prescribed set of secondary courses required for 
an individual to be eligible for a Presidential Access Scholarship 
under chapter 3, subpart 2, part A, title IV of the HEA; and
    (ii) Maintaining satisfactory academic progress according to the 
requirements in 34 CFR 668.7 in a postsecondary education program.
    (4) Pre-freshman summer programs that--
    (i) Are at institutions of higher education that also have academic 
support services for disadvantaged students through projects regulated 
by 34 CFR part 646, Student Support Services, or through comparable 
projects as certified by the SEA or other appropriate State agency 
funded by the State or other sources;
    (ii) Assure the participation of students who qualify as 
disadvantaged students or who are eligible for comparable programs 
funded by the State and certified under paragraph (a)(4)(i) of this 
section;
    (iii) Provide summer services, including--
    (A) instruction in remedial, developmental, or supportive courses;
    (B) counseling, tutoring, or orientation; and
    (C) grant aid to students to cover pre-freshman summer costs for 
books, supplies, living costs, and personal expenses; and
    (iv) Assure that participating students will receive financial aid 
during each academic year they are enrolled at the participating 
institution after the pre-freshman summer.
    (5) Other activities as the State proposes and the Secretary 
approves as supportive of the purposes of the NEISP Program.
    (b) The State shall indicate to the Secretary which of the 
following permissible service providers will conduct the early 
intervention component activities:
    (1) Community-based organizations.
    (2) Elementary or secondary schools.
    (3) Institutions of higher education.
    (4) Public and private agencies.
    (5) Nonprofit and philanthropic organizations.
    (6) Businesses.
    (7) Institutions and agencies sponsoring programs authorized under 
the State Student Incentive Grant Program, subpart 4, part A, title IV 
of the HEA.
    (8) Institutions and agencies sponsoring programs authorized under 
the Federal TRIO Programs, chapter 1, subpart 2, part A, title IV of 
the HEA.
    (9) Religious organizations.
    (10) Other organizations proposed by the State that are 
subsequently deemed appropriate by the Secretary.
    (c) The State shall describe how the service providers listed in 
paragraph (b) of this section will administer the early intervention 
component activities.
    (d) The State shall propose for review by and approval of the 
Secretary the methods by which it will target its early intervention 
services on priority students.


(Authority: 20 U.S.C. 1070a-23)


Sec. 693.12  What requirements must be met by the State under the 
program's scholarship component?

    A State shall provide for a scholarship component that--
    (a) As described in the State's plan approved by the Secretary 
under Sec. 693.10, is closely coordinated with other Federal, State, 
local, and private scholarship programs within the State;
    (b) Awards scholarships only to students who meet the eligibility 
requirements in Sec. 693.40;
    (c) Places a priority on awarding scholarships to students who will 
receive Federal Pell Grant awards for the academic year in which the 
award is being made under this part by--
    (1) Selecting those eligible students with the lowest expected 
family contributions as calculated under part F of title IV of the HEA 
who will also receive Federal Pell Grants; and
    (2) If the State has NEISP Program scholarship funds remaining 
after making NEISP awards to all of the eligible Federal Pell Grant 
recipients, awarding the remaining NEISP Program scholarship funds to 
those eligible students with the lowest expected family contributions 
who will not receive Federal Pell Grant awards;
    (d) Awards continuation scholarships in successive award years to 
each student who received an initial scholarship and who continues to 
meet the student eligibility requirements under Sec. 693.40;
    (e) Establishes the maximum amount of a scholarship that each 
eligible student is to receive and ensures that no scholarship is less 
than the lesser of--
    (1) 75 percent of the average cost of attendance, as determined 
under section 472, part F of the HEA, for an in-State student in a 4-
year program of instruction at public institutions of higher education 
in the State; or
    (2) The maximum Federal Pell Grant award funded for that fiscal 
year;
    (f) Ensures that, for each recipient of a scholarship under this 
part, a Federal Pell Grant be awarded first, other public and private 
grant and scholarship assistance be awarded second, a scholarship under 
this part be awarded third, and then other financial assistance be 
awarded;
    (g) Ensures that no scholarship awarded under this part, combined 
with other title IV, HEA financial assistance and any other grant or 
scholarship assistance exceeds the student's total cost of attendance, 
as determined under section 472, part F of the HEA;
    (h) Expends all NEISP Program funds under the scholarship 
component, as determined according to Sec. 693.10(b)(5)(iv), on 
scholarships to students;
    (i) Notifies recipients of scholarships under this part that they 
are to be known as ``[insert name of the State] National Partnership 
Scholars''; and
    (j) Describes to the satisfaction of the Secretary the procedures 
the State will use to award scholarships to eligible students in the 
event that the State receives reduced or no Federal funding under the 
NEISP Program during any fiscal year.

(Authority: 20 U.S.C. 1070a-24)


Sec. 693.13  What information must a State provide in its annual 
application to receive a grant under the NEISP Program?

    (a) Each State desiring to participate in the program under this 
part shall submit an application annually through the State agency 
designated to administer the NEISP Program under Sec. 693.10(b) that 
contains information required by the Secretary to demonstrate that the 
State meets its fund-matching assurances provided for in its plan, 
including--
    (1) The total amount of non-Federal funds, listed by each source, 
that the State expects to expend during the next award year that will 
total one-half or more of the cost of the NEISP Program such as--
    (i) The amount of the scholarships paid to students from State, 
local, or private funds under the NEISP Program;
    (ii) The amount of tuition, fees, room, or board waived or reduced 
for recipients of grants under the NEISP Program; and
    (iii) The amount expended on documented, targeted, long-term 
mentoring and counseling provided by volunteers or paid staff of 
nonschool organizations, including businesses, religious organizations, 
community groups, postsecondary educational institutions, nonprofit or 
philanthropic organizations, and other organizations proposed by the 
State and approved by the Secretary;
    (2) A description of the specific methods by which the State's 
share of the costs under the NEISP Program will be paid;
    (3) The percentage of the State's Federal allotment that it plans 
to expend for the early intervention component of its NEISP Program 
and, if the State requests a waiver from the Secretary under paragraph 
(b) of this section, the State shall submit supporting documentation, 
including the amount and source of its additional assistance;
    (4) The documentation that assures the Secretary that the amount of 
funds provided in paragraph (a)(1) of this section will supplement and 
not supplant funds expended for State and local early intervention 
programs and State need- and non-need-based student financial grant and 
scholarship assistance expended during the fiscal year 2 years prior to 
the fiscal year in which the State first received funds under this 
program; and
    (5)(i) Proposed changes to the initial State plan that was approved 
by the Secretary, according to Sec. 693.10(b), for the review and 
approval of the Secretary; or
    (ii) If no changes to its initial plan are proposed, an assurance 
that the State will continue to operate its NEISP Program according to 
the existing State plan approved by the Secretary under Sec. 693.10(b).
    (b) The Secretary waives the requirement in Sec. 693.10(b)(5)(iv) 
and allows the State to exceed the 50 percent limit on expenditure of 
its Federal allotment for the early intervention component if the State 
can demonstrate to the satisfaction of the Secretary that the State has 
another adequate means to provide scholarships to eligible students 
under the NEISP Program.


(Authority: 20 U.S.C. 1070a-22)

Subpart C--How Does the Secretary Make a Grant to a State?


Sec. 693.20  What criteria does the Secretary use to determine whether 
a State's proposed early intervention component meets the requirements 
under this program?

    The Secretary uses the following criteria to determine whether a 
State's early intervention component proposed under 
Sec. 693.10(b)(3)(i) meets the requirements of Sec. 693.11:
    (a) Plan of operation. (1) The Secretary reviews each State's plan 
for information that shows the quality of the operating plan of the 
early intervention component.
    (2) The Secretary looks for information that shows--
    (i) High quality in the design of the component;
    (ii) An effective plan of management that ensures proper and 
efficient administration of the component;
    (iii) A clear description of how the State's proposed early 
intervention component relates to the purpose of the program;
    (iv) The way that the State plans to use its resources and 
personnel to achieve the objectives of the component;
    (v) A clear description of the methods that the State will use to 
target early intervention services to priority students. The State must 
base the proposed methods on the latest available State data. The State 
may target services on priority students by--
    (A) Elementary and secondary schools with high concentrations of 
priority students within the State;
    (B) Appropriate identifiable geographic areas such as counties or 
school districts (including both public and private schools) with high 
concentrations of priority students within the State; or
    (C) Other methods proposed by a State and approved by the 
Secretary;
    (vi) A clear description of the comprehensive long-term mentoring 
and advising that the State plans to provide to eligible students; and
    (vii) The extent to which other State grant funds are available to 
eligible NEISP students for postsecondary educational scholarships if 
the Federal scholarship component of the program is unfunded or 
reduced.
    (b) Quality of key personnel. (1) The Secretary reviews each State 
plan for information that shows the qualifications of the key personnel 
the State plans to use to administer its early intervention component.
    (2) The Secretary looks for information that shows--
    (i) The qualifications of the director of the early intervention 
component;
    (ii) The qualifications of each of the other key personnel to be 
used in the component; and
    (iii) The amount of time each person referred to in paragraphs 
(b)(2)(i) and (ii) of this section will spend working in the activities 
under this component.
    (3) To determine the qualifications of the key personnel, the 
Secretary considers evidence of past experience and training in fields 
related to the objectives of the early intervention component as well 
as other information the State provides.
    (c) Budget and cost effectiveness. (1) The Secretary reviews each 
State's plan for information that shows that the early intervention 
component has an adequate budget and is cost-effective.
    (2) The Secretary looks for information that shows--
    (i) The budget for the project is adequate to support the early 
intervention component activities; and
    (ii) Costs are reasonable in relation to the activities under the 
component.
    (3) The Secretary reviews the State's budget for the early 
intervention component to verify that not more than 50 percent of the 
State's allotment is projected to be spent on its early intervention 
component unless the State requests and is granted a waiver under 
Sec. 693.13(b).
    (d) Adequacy of resources. (1) The Secretary reviews each State's 
plan for information that shows that the State plans to devote adequate 
resources to its early intervention component.
    (2) The Secretary looks for information that shows--
    (i) The facilities that the State plans to use are adequate; and
    (ii) The equipment and supplies that the State plans to use are 
adequate.
    (e) Need for the program. (1) The Secretary reviews each State's 
plan for information that shows the need for the early intervention 
component and the methods for targeting its early intervention 
component activities on eligible students.
    (2) The Secretary looks for information that shows--
    (i) The number and percentage of students who are eligible to be 
served by the State's early intervention component, including students 
who are priority students and students who are disadvantaged;
    (ii) The extent to which the State documents its need for the 
services and activities that the State proposes to provide under its 
early intervention component;
    (iii) The ratio of secondary school counselors to all students and 
to early intervention eligible students, if the data is available;
    (iv) For each of the 3 preceding years, if available, the estimated 
dropout rates for the State, including the dropout rate for all 
students and for students eligible for the early intervention component 
as proposed by the State; and
    (v) For each of the 3 preceding years, if available, the estimated 
number and percentage of students in the State who enrolled in 
postsecondary institutions for--
    (A) All students who were eligible to enroll; and
    (B) Students who would have been eligible for the State's proposed 
early intervention component.
    (f) Likelihood for success. (1) The Secretary reviews each State 
plan for information that shows the likelihood of success of its early 
intervention component.
    (2) The Secretary looks for information that shows the extent to 
which the State's early intervention component is likely to--
    (i) Enable the participants to develop academic skills, such as 
reading, writing, mathematics, and study skills, that are essential for 
postsecondary education;
    (ii) Improve academic skills and motivate the participants to 
complete a secondary educational program and subsequently gain 
admission to postsecondary education institutions; and
    (iii) Increase the secondary and postsecondary readmission rates of 
those participants who have not completed secondary or postsecondary 
education.
    (3) The Secretary also looks for information that shows how 
comprehensively the State's proposed early intervention component--
    (i) Identifies and selects eligible participants;
    (ii) Diagnoses each participant's need for academic support in 
order to successfully pursue a program of postsecondary education;
    (iii) Develops a plan of program support to improve each 
participant's skills; and
    (iv) Provides the services and activities listed in Sec. 693.11(a) 
that relate to the goals of the NEISP Program.
    (g) Public and private support. (1) The Secretary reviews each 
State's plan for information that shows how the State will put in place 
a partnership of public and private organizations within the State to 
administer the early intervention component of the program under this 
part.
    (2) The Secretary looks for information that shows--
    (i) The extent to which the State has received and has included in 
its plan written commitments by organizations that will provide early 
intervention services under Sec. 693.11(b); and
    (ii) The existence of a plan to inform the residents of the State 
of the NEISP Program services and eligibility criteria.
    (h) Coordination with other early intervention activities.
    (1) The Secretary reviews each State's plan for information that 
shows how the State will coordinate its early intervention component 
with existing early intervention activities within the State.
    (2) The Secretary looks for information that shows--
    (i) The extent to which the State has investigated early 
intervention program activity and included in its plan the number and 
types of currently operating public and private early intervention 
programs within the State;
    (ii) The extent to which the State's proposed plan will supplement 
existing Federal, State, local, and private early intervention programs 
within the State, such as the Federal Head Start, Chapter 1 Program in 
Local Educational Agencies, and TRIO programs; and
    (iii) The written plans and commitments submitted to the State by 
other early intervention program providers that the State plans to use 
as either early intervention service providers under Sec. 693.11(b) or 
as support organizations for those service providers.
    (i) Evaluation report plan. (1) The Secretary reviews each State's 
plan to evaluate the quality of the proposed biennial evaluation report 
of the early intervention component of the program.
    (2) The Secretary looks for information that shows--
    (i) The quality of the design of the component;
    (ii) The extent that the methods of evaluation are appropriate for 
the program and the extent they are objective and produce useful data 
that are quantifiable;
    (iii) The State's commitment to design an evaluation report to 
measure objectively performance against, at a minimum, the following 
standards:
    (A) The effectiveness of the State's program in meeting the 
purposes of the program.
    (B) The effect of the program on the student recipients being 
served by the program.
    (C) The barriers to the effectiveness of the program and 
recommendations for changes or improvements to the program.
    (D) The cost-effectiveness of the program.
    (E) The extent to which the student recipients comply with the 
requirements of the program; and
    (iv) Any other pertinent program measurements concerning the early 
intervention component that the State believes would be useful to the 
Secretary, which may be displayed through analytical charts, tables, 
and graphs.

(Authority: 20 U.S.C. 1070a-23)


Sec. 693.21  How does the Secretary allot funds to a State?

    (a) If the amount appropriated for the program under this part for 
a fiscal year is $50,000,000 or more, the Secretary allots to each 
State that has submitted an approved plan under Sec. 693.10 and an 
approved application under Sec. 693.13, an amount that bears the same 
ratio to the total appropriation as the amount allocated to the LEAs in 
the State under 34 CFR part 200 bears to the total amount allocated to 
all LEAs in all States using the most recently available data.
    (b) If the amount appropriated for the program under this part for 
a fiscal year is less than $50,000,000, the Secretary allots funds to 
each State in accordance with the provisions in Sec. 693.22.
    (c) From the allotment calculated in this section, the Secretary 
disburses to a State an amount equal to not more than one-half of the 
total amount of funds from all sources the State projects that it will 
expend on its NEISP Program for a fiscal year as reported on its annual 
application under Sec. 693.13(a).
    (d) A State may expend from its Federal allotment no more than one-
half of the total amount of funds the State expends under its NEISP 
Program for that fiscal year.

(Authority: 20 U.S.C. 1070a-25)


Sec. 693.22  How does the Secretary allot funds to States on a 
competitive basis?

    (a) The Secretary allots funds to States under this program on a 
competitive basis if the program appropriation for a fiscal year is 
less than $50,000,000.
    (b) The Secretary conducts a grant competition for the States by 
means of a notice published in the Federal Register that contains the 
information needed by a State to apply for funds under a discretionary 
NEISP Program competition. The Secretary evaluates a State's 
application for funds under a discretionary NEISP Program competition 
on the basis of the extent to which the State fulfills the requirements 
listed in Secs. 693.10, 693.11, 693.12, 693.13, and 693.20, and the 
selection criteria in this section.
    (c)(1) The Secretary uses the selection criteria in paragraph (d) 
of this section to evaluate applications for grants under this program.
    (2) The maximum score, not including prior grant recipient priority 
points in paragraph (d)(12) of this section, for all of these criteria 
is 140 points.
    (3) The maximum score for each criterion is indicated in 
parentheses in paragraph (d).
    (4) In the final selection of similarly rated applications, the 
Secretary considers the extent to which a State provides--
    (i) A comprehensive State-wide early intervention and postsecondary 
educational scholarship program;
    (ii) Eligible students with comprehensive long-term mentoring and 
advising; and
    (iii) Eligible students with State grant funds for their 
postsecondary education as compared to the other States who apply for 
grant funds.
    (d)(1) Need for the program. (20 points) The Secretary reviews each 
State's application for information that shows the need for the State-
wide early intervention component and the methods for targeting its 
early intervention component activities on eligible students including 
consideration of--
    (i) The number and percentage of students who are eligible to be 
served by the State's early intervention component, including students 
who are priority students and students who are disadvantaged;
    (ii) The extent to which the State documents its need for the 
services and activities that the State proposes to provide under its 
early intervention component;
    (iii) The ratio of secondary school counselors to all students and 
to early intervention eligible students, if the data is available;
    (iv) For each of the three preceding years, if available, the 
estimated dropout rates for the State, including the dropout rate for 
all students and for students eligible for the early intervention 
component as proposed by the State; and
    (v) For each of the three preceding years, if available, the 
estimated number and percentage of students in the State who enrolled 
in postsecondary institutions for--
    (A) All students who were eligible to enroll; and
    (B) Students who would have been eligible for the State's proposed 
early intervention component; and
    (vi) Describes the procedures the State will use to award 
postsecondary education scholarships to eligible students in the event 
that the State receives reduced or no Federal funding under the NEISP 
Program during any fiscal year.
    (2) Plan of operation. (30 points) The Secretary reviews each 
State's application for information that shows the quality of the 
operating plan of the State-wide early intervention component, 
including--
    (i) (3 points) The quality of the design of the component;
    (ii) (3 points) An effective plan of management that ensures proper 
and efficient administration of the component;
    (iii) (3 points) A clear description of how the State's proposed 
early intervention component relates to the purpose of the program;
    (iv) (3 points) The way that the State plans to use its resources 
and personnel to achieve the objectives of the component;
    (v) (3 points) A clear description of the methods that the State 
will use to target early intervention services to priority students. 
The State must base the proposed methods on the latest available State 
data. The State may target services on priority students by--
    (A) Elementary and secondary schools with high concentrations of 
priority students within the State;
    (B) Appropriate identifiable geographic areas such as counties or 
school districts (including both public and private schools) with high 
concentrations of priority students within the State; or
    (C) Other methods proposed by a State and approved by the 
Secretary;
    (vi) (7 points) A clear description of the comprehensive long-term 
mentoring and advising that the State plans to provide to eligible 
students; and
    (vii) (8 points) The extent to which other State grant funds are 
available to eligible NEISP students for their postsecondary education 
if the Federal scholarship component of the program is unfunded or 
reduced.
    (3) Quality of key personnel. (10 points) (i) The Secretary reviews 
each State application for information that shows the qualifications of 
the key personnel the State plans to use to administer its State-wide 
early intervention component including--
    (A) The qualifications of the director of the early intervention 
component;
    (B) The qualifications of each of the other key personnel to be 
used in the component; and
    (C) The amount of time each person referred to in paragraphs 
(d)(3)(i) (A) and (B) of this section will spend working in the 
activities under this component.
    (ii) To determine the qualifications of the key personnel, the 
Secretary considers evidence of past experience and training in fields 
related to the objectives of the early intervention component as well 
as other information the State provides.
    (4) Budget and cost effectiveness. (5 points) The Secretary reviews 
each State's application for information that shows that the early 
intervention component has an adequate budget and is cost-effective 
including--
    (i) The budget for the project is adequate to support the early 
intervention component activities; and
    (ii) Costs are reasonable in relation to the activities under the 
component.
    (5) Adequacy of resources. (5 points) The Secretary reviews each 
State's application for information that shows that the State plans to 
devote adequate resources to its early intervention component 
including--
    (i) The facilities that the State plans to use are adequate; and
    (ii) The equipment and supplies that the State plans to use are 
adequate.
    (6) Likelihood for success. (20 points) The Secretary reviews each 
State application for information that shows the extent to which the 
State's early intervention component is likely to--
    (i) Enable the participants to develop academic skills, such as 
reading, writing, mathematics, and study skills, that are essential for 
postsecondary education;
    (ii) Improve academic skills and motivate the participants to 
complete a secondary educational program and subsequently gain 
admission to postsecondary education institutions;
    (iii) Increase the secondary and postsecondary readmission rates of 
those participants who have not completed secondary or postsecondary 
education;
    (iv) Identify and select eligible participants;
    (v) Diagnose each participant's need for academic support in order 
to successfully pursue a program of postsecondary education; and
    (vi) Develop a plan of program support to improve each 
participant's skills.
    (7) Public and private support. (15 points) The Secretary reviews 
each State's application for information that shows how the State will 
put in place a partnership of public and private organizations within 
the State to administer the early intervention component of the program 
including--
    (i) The extent to which the State has received and has included in 
its plan written commitments by organizations that will provide early 
intervention services; and
    (ii) The existence of a plan to inform the residents of the State 
of the NEISP Program services and eligibility criteria.
    (8) Coordination with other early intervention activities. (15 
points) The Secretary reviews each State's application for information 
that shows how the State will coordinate its early intervention 
component with existing early intervention activities within the State 
including--
    (i) The extent to which the State has investigated early 
intervention program activity and included in its plan the number and 
types of currently operating public and private early intervention 
programs within the State;
    (ii) The extent to which the State's proposed plan will supplement 
existing Federal, State, local, and private early intervention programs 
within the State, such as the Federal Head Start, Chapter 1 Program in 
Local Educational Agencies, and TRIO programs; and
    (iii) The written plans and commitments submitted to the State by 
other early intervention program providers that the State plans to use 
as either early intervention service providers or as support 
organizations for those service providers.
    (9) Willingness to overmatch. (10 points) The Secretary reviews 
each State's application to determine whether the State is willing to 
contribute more than one-half the cost of the program and the extent to 
which the State will overmatch its Federal allotment.
    (10) Evaluation report plan. (10 points) The Secretary reviews each 
State's application to evaluate the quality of the proposed biennial 
evaluation report of the early intervention component of the program 
including--
    (i) The quality of the design of the component;
    (ii) The extent that the methods of evaluation are appropriate for 
the program and the extent they are objective and produce useful data 
that are quantifiable; and
    (iii) The State's commitment to design an evaluation report to 
measure objectively performance against, at a minimum, the following 
standards:
    (A) The effectiveness of the State's program in meeting the 
purposes of the program.
    (B) The effect of the program on the student recipients being 
served by the program.
    (C) The barriers to the effectiveness of the program and 
recommendations for changes or improvements to the program.
    (D) The cost-effectiveness of the program.
    (E) The extent to which the student recipients comply with the 
requirements of the program; and
    (iv) Any other pertinent program measurements concerning the early 
intervention component that the State believes would be useful to the 
Secretary, which may be displayed through analytical charts, tables, 
and graphs.
    (11) Prior experience. (20 points) In any award year subsequent to 
the 1994-95 award year, the initial year for which Federal funds were 
appropriated for this program, the Secretary gives priority to each 
State applicant that has conducted a NEISP Program within the fiscal 
year prior to the fiscal year for which the State applicant is applying 
in accordance with the following procedures:
    (i) To determine the number of priority points to be awarded each 
eligible State applicant, the Secretary considers the State's prior 
experience of program participation in accordance with paragraphs 
(d)(11) (ii) and (iii) of this section.
    (ii) The Secretary may add from one to twenty points to the point 
score obtained on the basis of the selection criteria, based on the 
State applicant's success in meeting the administrative requirements 
and programmatic objectives of paragraph (d)(11)(iii) of this section.
    (iii) The Secretary--based on information contained in one or more 
of the following: performance reports, audit reports, site visit 
reports, program evaluation reports, the previously funded application, 
the negotiated program plan or plans, previous State matching funds, 
and the application under consideration--considers information that 
shows--
    (A) (5 points) The extent to which the State's program has served 
the number of student participants it was funded to serve;
    (B) (5 points) The extent to which the State's program has achieved 
the goals and objectives as stated in the previously funded application 
or negotiated program plan;
    (C) (5 points) The extent to which the State has met the 
administrative requirements--including recordkeeping, reporting, and 
financial accountability--under the terms of the previously funded 
award; and
    (D) (5 points) The extent to which the State has provided funds to 
match its Federal allotment.
    (e) The Secretary disburses to each State selected in the 
competition conducted under paragraph (b) of this section an amount 
equal to not more than one-half of the total amount of funds from all 
sources the State projects that it will expend on its NEISP Program for 
a fiscal year as reported on its annual application under 
Sec. 693.13(a)(1).

(Authority: 20 U.S.C. 1070a-25)

Subpart D--How Does a Student Participate in the Early Intervention 
Component Under the NEISP Program?


Sec. 693.30  What are the requirements for a student to be a 
participant in the early intervention component of this program?

    The State agency administering the NEISP Program, as approved by 
the Secretary under Sec. 693.10(b)(1), shall select students in 
preschool through grade 12 to participate in the State's early 
intervention component, each of whom--
    (a)(1) Is a citizen or a national of the United States;
    (2) Is a permanent resident of the United States;
    (3) Provides evidence from the Immigration and Naturalization 
Service that he or she is in the United States for other than a 
temporary purpose with the intention of becoming a citizen or permanent 
resident; or
    (4) Is a permanent resident of the Trust Territory of the Pacific 
Islands;
    (b) Is, at the time of initial selection, a priority student, an 
at-risk student, a disadvantaged student, or a student with a limited 
proficiency in English;
    (c) Has a need for academic support, as determined by the State, to 
pursue his or her education successfully;
    (d) Resides within the State;
    (e) Is not currently enrolled in a program of postsecondary 
education;
    (f) Meets such other criteria as the State includes in its plan in 
order to meet the unique needs of the State and that are approved by 
the Secretary; and
    (g) For an otherwise eligible student who is attending secondary 
school, is a student whom the State determines can reasonably be 
expected to meet the student eligibility requirements of 34 CFR 668.7 
for Federal student financial assistance and such other requirements as 
necessary to qualify for State, local, or private student financial 
assistance, at such time as the student enrolls in postsecondary 
education.

(Authority: 20 U.S.C. 1070a-23)

Subpart E--How Does a State Award a Scholarship to a Student?


Sec. 693.40  What are the requirements for a student to receive a 
scholarship under this program?

    To be eligible for a scholarship under the scholarship component of 
this program, a student must--
    (a) Apply for the scholarship by following the application 
procedures and deadlines established by the State agency approved by 
the Secretary under Sec. 693.10(b)(1) to administer the NEISP Program 
in the State in which the individual resides;
    (b) Meet the relevant eligibility requirements contained in 34 CFR 
668.7;
    (c) Be less than 22 years old at the time his or her first 
scholarship is awarded;
    (d) Be enrolled or accepted for enrollment in a program of 
instruction at an institution of higher education that is located 
within the State's boundaries, except that a State, at its option, may 
offer such a scholarship to a student who attends an eligible 
institution of higher education outside of the State; and
    (e)(1) Have participated in the early intervention component of the 
program under this part; or
    (2) Be a student whom the State documents as having successfully 
participated in a Federal TRIO program funded under chapter 1, subpart 
2, part A of title IV of the HEA as determined by an administrator of 
the appropriate Federal TRIO program in which the student participated.

(Authority: 20 U.S.C. 1070a-24)

Subpart F--What Postaward Conditions Must Be Met by a State?


Sec. 693.50  What are allowable costs attributable to administration of 
the early intervention component?

    A State may use its NEISP Program funds for the following allowable 
costs not specifically covered by 34 CFR parts 76 or 80 that are 
reasonably related to carrying out the early intervention component of 
the NEISP Program:
    (a) In-service training of project staff.
    (b) Transportation and meal costs for participants and staff for--
    (1) Approved visits to postsecondary educational institutions in 
the area;
    (2) Participation in ``College Days'' and ``College Fair'' 
activities; and
    (3) Field trips to observe and meet with people who are employed in 
various career fields and who can act as role models for early 
intervention participants.
    (c) Purchasing testing materials.
    (d) Admission fees, transportation, and other costs necessary to 
participate in field trips, attend educational activities, visit 
museums, and attend other events that have as their purpose the 
intellectual, social, and cultural development of early intervention 
participants.
    (e) Courses in English language instruction for participants with 
limited proficiency in English, if these classes are limited to early 
intervention component participants and if these classes are not 
otherwise available to those participants.
    (f) For participants in an early intervention residential summer 
activity, room and board--computed on a weekly basis--not to exceed the 
weekly rate a host institution charges regularly enrolled students at 
the institution.
    (g) Room and board for those people responsible for dormitory 
supervision of early intervention component participants during a 
residential summer activity.
    (h) Transportation costs of early intervention component 
participants for regularly scheduled component activities.
    (i) Transportation, meals, and overnight accommodations for staff 
members if they are required to accompany participants in program 
activities such as field trips.
    (j) Costs of remedial and special classes if--
    (1) These classes are limited to early intervention component 
participants; and
    (2) Identical instruction is not readily available through another 
Federal program or a State, local, or privately funded program.

(Authority: 20 U.S.C. 1070a-22)


Sec. 693.51  What are nonallowable costs that may not be charged to 
administration of the early intervention component?

    A State may not use its NEISP Program funds for costs incurred for 
the early intervention component of the NEISP Program such as--
    (a) Duplication of services that are available to participants 
through--
    (1) State, local, or private sources not included in the State plan 
under Sec. 693.11; or
    (2) Other Federal programs, such as projects under the Federal TRIO 
programs;
    (b) Research not directly related to the evaluation or improvement 
of the program;
    (c) Purchase of any equipment, unless the State demonstrates to the 
Secretary's satisfaction that purchase is less expensive than renting 
or leasing;
    (d) Meals for program staff except as provided in Sec. 693.50.
    (e) Clothing;
    (f) Construction, renovation, or remodeling of any facilities; or
    (g) Tuition, stipends, or any other form of student financial 
support for program staff.

(Authority: 20 U.S.C. 1070a-22)


Sec. 693.52  What requirements must a State meet in preparing and 
submitting an evaluation report?

    (a) Each State receiving an allotment under this part shall prepare 
and submit to the Secretary every two years an evaluation of the early 
intervention component of its NEISP Program. The report must summarize 
and evaluate a State's activities under the program and the performance 
of the student participants. Each State's evaluation report design must 
include measures that permit the State to track all participating 
students progress throughout each student's participation in the 
program.
    (b) The biennial evaluation report of the early intervention 
component of the program must include, but is not limited to--
    (1) Quantifiable information on the extent to which the State's 
program is fulfilling the program objectives;
    (2) The effect of the program on the student recipients being 
served by the program, including measurable outcomes such as improved 
academic performance, increased postsecondary education enrollment and 
retention, increased elementary and secondary school grade retention, 
reduced elementary and secondary school dropout rates, and reduced 
financial barriers to attendance at institutions of higher education;
    (3) The barriers to the effectiveness of the program and 
recommendations for changes or improvements to the program;
    (4) The cost-effectiveness of the program;
    (5) The extent to which the student recipients comply with the 
requirements of the program;
    (6) Key program information listed on an annual and biennial basis;
    (7) Other pertinent program measurements concerning the early 
intervention component that the State believes would be useful to the 
Secretary, which may be displayed through analytical charts, tables, 
and graphs; and
    (8) Any other information required by the Secretary in order to 
carry out the evaluation report function.

(Authority: 20 U.S.C. 1070a-26)

[FR Doc. 94-5190 Filed 3-7-94; 8:45 am]
BILLING CODE 4000-01-P