[Federal Register Volume 60, Number 35 (Wednesday, February 22, 1995)]
[Notices]
[Pages 9823-9824]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-4247]



=======================================================================
-----------------------------------------------------------------------

DEPARTMENT OF EDUCATION


Intent To Repay to the Oregon Department of Education Funds 
Recovered as a Result of a Final Audit Determination

AGENCY: Department of Education.

ACTION: Notice of intent to award grantback funds.

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

SUMMARY: Under section 459 of the General Education Provisions Act 
(GEPA), the U.S. Secretary of Education (Secretary) intends to repay to 
the Oregon Department of Education, the State educational agency (SEA), 
an amount equal to 75 percent of the $42,262.39 recovered by the U.S. 
Department of Education (Department) as a result of final audit 
determinations for Chapter 1 (Local Educational Agency and Migrant 
Education Programs) of Title I of the Elementary and Secondary 
Education Act of 1965, as amended (Chapter 1, ESEA). This notice 
describes the SEA's plan, submitted on behalf of the Klamath County 
School District (KCSD), the local educational agency (LEA), for the use 
of the repaid funds and the terms and conditions under which the 
Secretary intends to make those funds available. The notice invites 
comments on the proposed grantback.

DATES: All comments must be received on or before March 24, 1995.

ADDRESSES: Comments concerning the portion of the grantback that 
provides funds under the Chapter 1 basic programs operated by local 
educational agencies (LEA grants program) should be addressed to Mary 
Jean LeTendre, Director, Compensatory Education Programs, Office of 
Elementary and Secondary Education, U.S. Department of Education, 600 
Independence Avenue, S.W., (Portals Building, Room 4400), Washington, 
D.C. 20202-6132.
    All comments concerning the portion of the grantback that provides 
funds under the Migrant Education Program (MEP) should be addressed to 
Ms. Bayla F. White, Director, Office of Migrant Education, Office of 
Elementary and Secondary Education, U.S. Department of Education, 600 
Independence Avenue, S.W., (Portals Building, Room 4100), Washington, 
D.C. 20202-6135.

FOR FURTHER INFORMATION CONTACT: For the Chapter 1 LEA grants program, 
S. Colene Nelson, U.S. Department of Education, 600 Independence 
Avenue, S.W., (Portals Building, Room 4400), Washington, D.C. 20202-
6132. Telephone: (202) 260-0979. For the MEP, Lori Ahmady, U.S. 
Department of Education, 600 Independence Avenue, S.W., (Portals 
Building, Room 4104), Washington, D.C. 20202-6135. Telephone: (202) 
260-1391. 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:

A. Background

    The Department has recovered $42,262.39 from the Oregon Department 
of Education (SEA) in satisfaction of claims arising from an audit of 
KCSD covering fiscal year (FY) 1990.
    The claims involved the SEA's administration of Chapter 1, ESEA, 
providing financial assistance to State and local agencies to address 
the special educational needs of educationally deprived children in 
areas with high concentrations of children from low-income families 
(Chapter 1), as well as the special educational needs of migratory 
children (MEP). Specifically, the audit determinations, made by an 
independent auditor acting under the Single Audit Act of 1984 and 
upheld by the SEA, found that varying percentages of salaries and 
fringe benefits of five LEA employees tested were charged to Chapter 1 
during FY 1990. The auditors also questioned the portion of salary and 
fringe benefits for one LEA employee charged to the Chapter 1 MEP. In 
addition, no time distribution records were available to support the 
charges to either program. Finally, the auditors disclosed that the 
early retirement pay for one employee was divided equally between the 
Chapter 1 program and the MEP, even though the employee had worked on 
these programs for only three of a total of twenty-two years with the 
district. The auditors, therefore, questioned 19/22 of the early 
retirement cost charged to Chapter 1 and the MEP grants ($1,813.64 to 
each). Altogether, disputed costs totaled $31,396.39 for the Chapter 1 
grant, and $10,866 for the MEP grant.
    The SEA, on August 24, 1992, requested a refund of the full amount 
of questioned costs from KCSD. On September 15, 1992, the SEA submitted 
a check to the U.S. Department of Education in the amount of 
$66,395.52, which included a recovery of $31,396.39 for the Chapter 1 
program, as well as $10,866 related to the MEP. The remaining 
$24,133.13 resulted from audit recoveries from other Federal programs 
and are not part of this grantback notice.

B. Authority for Awarding a Grantback

    Section 459(a) of GEPA, 20 U.S.C. 1234h(a), provides that whenever 
the Secretary has recovered program funds following a final audit 
determination, the Secretary may consider those funds to be additional 
funds available for the program and may arrange to repay to the SEA or 
LEA affected by that determination an amount not to exceed 75 percent 
of the recovered funds. The Secretary may enter into this grantback 
arrangement if the Secretary determines that the--
    (1) Practices or procedures of the SEA or LEA that resulted in the 
audit [[Page 9824]] determination have been corrected, and the SEA or 
LEA is, in all other respects, in compliance with the requirements of 
the applicable program;
    (2) SEA has submitted to the Secretary a plan for the use of the 
funds to be awarded under the grantback arrangement that meets the 
requirements of the program, and to the extent possible, benefits the 
population that was affected by the failure to comply or by the 
misexpenditures that resulted in the audit exception; and
    (3) Use of funds to be awarded under the grantback arrangement in 
accordance with the SEA's plan would serve to achieve the purposes of 
the program under which the funds were originally granted.

C. Plan for Use of Funds Awarded Under a Grantback Arrangement

    Pursuant to section 459(a)(2) of GEPA, the SEA has applied for a 
grantback of $31,696--75 percent of the principal amount recovered by 
the Department--and has submitted a plan on behalf of the LEA for use 
of the grantback funds to meet the special educational needs of both 
educationally deprived children in programs administered under Chapter 
1, ESEA (20 U.S.C. 2701 et seq.), as well as those of migratory 
children under the Chapter 1 MEP (20 U.S.C. 2781 et seq.).
    According to the plan, the LEA will use the grantback funds under 
Chapter 1 to upgrade its existing Higher Order Thinking Skills program 
(H.O.T.S.). This computer-assisted instruction has been used 
successfully in the county for the past two years to improve the skills 
of educationally deprived children, and the use of the program promotes 
the purpose of the Chapter 1 program under which funds were allocated 
(see section 1001(b)).
    The KCSD currently has five existing H.O.T.S. Mac Labs, which serve 
an average of 28 students, in grades 4 through 7. The requested 
grantback funds will be used to upgrade existing H.O.T.S. sites and 
allow for another Mac Lab site to be established at Keno Elementary 
School. Also, software would be purchased for the five existing Mac 
Labs, as well as for the new Mac Lab.
    The grantback funds under the Chapter 1 MEP will be used to 
purchase computer hardware and software for language instruction to 
migratory children in four schools in the LEA.

D. The Secretary's Determinations

    The Secretary has carefully reviewed the plan submitted by the SEA. 
Based upon that review, the Secretary has determined that the 
conditions under section 459 of GEPA have been met. These 
determinations are based upon the best information available to the 
Secretary at the present time. If this information is not accurate or 
complete, the Secretary may take appropriate administrative action. In 
finding that the conditions of section 459 of GEPA have been met, the 
Secretary makes no determination concerning any pending audit 
recommendations or final audit determinations.

E. Notice of the Secretary's Intent to Enter Into a Grantback 
Arrangement

    Section 459(d) of GEPA requires that, at least 30 days before 
entering into an arrangement to award funds under a grantback, the 
Secretary must publish in the Federal Register a notice of intent to do 
so, and the terms and conditions under which payment will be made.
    In accordance with section 459(d) of GEPA, notice is hereby given 
that the Secretary intends to make funds available to the SEA under a 
grantback arrangement. The grantback award would be in the amount of 
$31,696.

F. Terms and Conditions Under Which Payments Under a Grantback 
Arrangement Would Be Made

    The SEA and LEA agree to comply with the following terms and 
conditions under which payment under a grantback arrangement would be 
made:
    (1) The funds awarded under the grantback must be spent in 
accordance with--
    (a) All applicable statutory and regulatory requirements;
    (b) The plan that the SEA submitted and any amendments to that plan 
that are approved in advance by the Secretary; and
    (c) The budget that was submitted with the plan and any amendments 
to the budget that are approved in advance by the Secretary.
    (2) All funds received under the grantback arrangement must be 
obligated by September 30, 1995, in accordance with section 459(c) of 
GEPA and the SEA's plan.
    (3) The SEA, on behalf of the LEA, will, not later than December 
31, 1995, submit a report to the Secretary that--
    (a) Indicates that the funds awarded under the grantback have been 
spent in accordance with the proposed plan and approved budget; and
    (b) Describes the results and effectiveness of the project for 
which the funds were spent.
    (4) Separate accounting records must be maintained documenting the 
expenditures of funds awarded under the grantback arrangement.

    Dated: February 8, 1995.
Thomas W. Payzant,
Assistant Secretary for Elementary and Secondary Education.
(Catalog of Federal Domestic Assistance Number 84.010, Educationally 
Deprived Children--Local Educational Agencies; and Catalog of 
Federal Domestic Assistance Number 84.011, Chapter 1 Migrant 
Education Program)

[FR Doc. 95-4247 Filed 2-21-95; 8:45 am]
BILLING CODE 4000-01-P