[Federal Register Volume 61, Number 145 (Friday, July 26, 1996)]
[Proposed Rules]
[Pages 39246-39251]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-18917]



[[Page 39245]]


_______________________________________________________________________

Part V





Department of Education





_______________________________________________________________________



34 CFR Part 263



Indian Fellowship and Professional Development Programs; Proposed Rule

  Federal Register / Vol. 61, No. 145 / Friday, July 26, 1996 / 
Proposed Rules  

[[Page 39246]]



DEPARTMENT OF EDUCATION

34 CFR Part 263

RIN 1810-AA79


Indian Fellowship and Professional Development Programs

AGENCY: Department of Education.

ACTION: Notice of Proposed Regulations.

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

SUMMARY: The Secretary proposes to amend the regulations that govern 
grants for the Indian Fellowship Program. This program is authorized 
under Title IX of the Elementary and Secondary Education Act (ESEA) of 
1965, as amended by the Improving America's Schools Act of 1994, 
enacted October 20, 1994. These regulations would identify eligible 
applicants for the program and the specific application and other 
program requirements that applicants must meet in order to be 
considered for funding. These regulations would also provide certain 
general provisions and requirements for the new payback provisions that 
apply to both the Indian Fellowship Program and the Professional 
Development Program.

DATES: Comments must be received on or before August 26, 1996.

ADDRESSES: All comments concerning these proposed regulations should be 
addressed to Cathie Martin, Office of Indian Education, Department of 
Education, 600 Independence Avenue, S.W., Portals Building--Room 4300, 
Washington, D.C. 20202-6335. Comments may also be sent through the 
Internet to ``Indian__F[email protected]''.
    Comments that concern information collection requirements must be 
sent to the Office of Management and Budget at the address listed in 
the Paperwork Reduction Act section of this preamble. A copy of those 
comments may also be sent to the Department representative named in the 
preceding paragraph.

FOR FURTHER INFORMATION CONTACT: Cathie Martin. Telephone: (202) 260-
1683. 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: On October 20, 1994 the Professional 
Development Program and the Indian Fellowship Program were 
substantially revised and recodified, respectively, as sections 9122 
and 9123 of Subpart 2 of Part A of Title IX of the Elementary and 
Secondary Education Act of 1965, as amended by Pub. L. 103-382. These 
proposed regulations would identify eligible applicants for the Indian 
Fellowship Program and address the specific program requirements, 
including application requirements and requirements concerning the new 
payback provisions that applicants must meet in order to be considered 
for funding for both new and continuation awards. The criteria for 
selecting participants for the Professional Development Program are not 
included in these proposed regulations. The selection criteria in the 
Education Department General Administrative Regulations (EDGAR), 34 CFR 
Part 75, will be used for competitions under the Professional 
Development Program.
    In addition, certain of these proposed regulations would govern the 
Professional Development Program (Sec. 263.3, (definitions), Sec. 263.1 
(b) and (c), and Secs. 263.35 through 263.37 (the new payback 
provisions that also apply to this program)).
    With regard to the payback provisions, the Indian Fellowship 
Program and Professional Development Program now require that an 
individual receiving financial assistance either (1) perform work 
related to the training for which assistance was received and that 
benefits Indian people; or (2) repay all or a prorated portion of the 
assistance.
    On June 27, 1995 the Secretary published final regulations (60 FR 
33300) to govern the fiscal year (FY) 1995 grant competitions for the 
Indian Fellowship and Professional Development Programs. This notice of 
proposed rulemaking (NPRM) proposes to amend the regulations that will 
apply to all FY 1996 awards, both new and continuation, and subsequent 
fiscal years' awards.
    Except for minor editorial and technical revisions, there are no 
differences between the regulations published June 27, 1995 and this 
NPRM. The submission of the certification required in Sec. 263.21(e) is 
not a new requirement but is a technical revision added for the 
convenience of the reader.

Executive Order 12866

Clarity of the Regulations

    Executive Order 12866 requires each agency to write regulations 
that are easy to understand.
    The Secretary invites comments on how to make these proposed 
regulations easier to understand, including answers to questions such 
as the following: (1) Are the requirements in the regulations clearly 
stated? (2) Do the regulations contain technical terms or other wording 
that interferes with their clarity? (3) Does the format of the 
regulations (grouping and order of sections, use of headings, 
paragraphing, etc.) aid or reduce their clarity? Would the regulations 
be easier to understand if they were divided into more (but shorter) 
sections? (A ``section'' is preceded by the symbol ``Sec. '' and a 
numbered heading; for example, Sec. 263.2 Who is eligible to apply 
under the Indian Fellowship Program?) (4) Is the description of the 
proposed regulations in the ``Supplementary Information'' section of 
this preamble helpful in understanding the proposed regulations? How 
could this description be more helpful in making the proposed 
regulations easier to understand? (5) What else could the Department do 
to make the regulations easier to understand?
    A copy of any comments that concern how the Department could make 
these proposed regulations easier to understand should be sent to 
Stanley M. Cohen, Regulations Quality Officer, U.S. Department of 
Education, 600 Independence Avenue, S.W. (Room 5100, FB-10B), 
Washington, D.C. 20202-2241.

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.
    These proposed regulations would affect individuals, institutions 
of higher education (IHEs), and local educational agencies (LEAs). 
Individuals, however, are not defined as ``small entities'' in the 
Regulatory Flexibility Act. These proposed regulations would not have a 
significant economic impact on the small IHEs or LEAs affected because 
the individuals, rather than the IHEs or LEAs, are subject to the 
payback provisions of these proposed regulations.

Paperwork Reduction Act of 1995

    Sections 263.21, 263.22, 263.30, 263.31, 263.32, 263.33, 263.35, 
263.36, and 263.37 contain information collection requirements. As 
required by the Paperwork Reduction Act of 1995 (44 U.S.C. 3507(d)), 
the Department of Education has submitted a copy of these sections to 
the Office of Management and Budget (OMB) for review.
    Collection of Information: Indian Fellowship and Professional 
Development Programs
    Individuals are eligible to apply for grants under the Indian 
Fellowship Program. The information to be collected includes--
assurances to meet certain statutory requirements; documents to show 
proof that the individual meets the definition of

[[Page 39247]]

``Indian;'' documents that provide verification that the individual has 
been admitted to an institution of higher education for an allowable 
field and level of study; documents that show the individual's past 
academic performance; a narrative essay on the individual's commitment 
to the selected field of study and service to the Indian community; and 
financial information to determine the amount of the fellowship. All 
new applications are submitted in response to a notice published in the 
Federal Register printed once each year. For continuing participants, 
the information submitted annually consists of information to document 
continued academic and financial eligibility. The information from both 
new and continuing respondents is used to determine applicant 
eligibility and award amounts of participants selected. All 
participants are required to provide a copy of their transcript after 
each academic term.
    The annual reporting burden for reviewing instructions, searching 
existing data sources, gathering and maintaining the data needed, and 
completing and reviewing the collection of information is estimated to 
be a total of four hours per response for 550 new respondents, .5 hours 
per response for 60 continuing respondents, and .25 hours per response 
for reporting (transcripts) for 100 respondents.
    Eligible applicants for the Professional Development Program 
include institutions of higher education, including Indian institutions 
of higher education, State or local educational agencies in consortium 
with an institution of higher education, and Indian tribes or 
organizations in consortium with an institution of higher education. 
The Indian Fellowship Program and the Professional Development Program 
require participants to perform a service payback or provide a cash 
payback if the service cannot be performed or completed. For those 
performing a service payback upon completion of their training program, 
participants will be required to provide a certification of employment 
every six months until the payback is completed. The information 
collected is used to track the progress of participants in completing 
their payback requirements. The annual reporting burden for this 
requirement is estimated to be .50 hours per response for 20 
respondents twice a year.
    The total annual reporting and recordkeeping burden for this 
collection is estimated to be 2,275 hours.
    Organizations and individuals desiring to submit comments on the 
information collection requirements should direct them to the Office of 
Information and Regulatory Affairs, OMB, Room 10235, New Executive 
Office Building, Washington, D.C., 20503; Attention: Wendy Taylor.
    The Department considers comments by the public on this proposed 
collection of information in--
     Evaluating whether the proposed collection of information 
is necessary for the proper performance of the functions of the 
Department, including whether the information will have practical 
utility;
     Evaluating the accuracy of the Department's estimate of 
the burden of the proposed collection of information, including the 
validity of the methodology and assumptions used;
     Enhancing the quality, usefulness, and clarity of the 
information to be collected; and
     Minimizing the burden of the collection of information on 
those who are to respond, including through the use of appropriate 
automated, electronic, mechanical, or other technological collection 
techniques or other forms of information technology; e.g., permitting 
electronic submission of responses.
    OMB is required to make a decision concerning the collection of 
information contained in these proposed regulations between 30 and 60 
days after publication of this document in the Federal Register. 
Therefore, a comment to OMB is best assured of having its full effect 
if OMB receives it within 30 days of publication. This does not affect 
the deadline for the public to comment to the Department on the 
proposed regulations.

Intergovernmental Review

    The Indian Fellowship Program is not subject to the requirements of 
Executive Order 12372 and the regulations in 34 CFR Part 79.
    The Professional Development Program, with the exception of 
assistance to federally recognized tribes, 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 
this 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 4302, Portals Building, 1250 Maryland Avenue, S.W., 
Washington, D.C., 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 263

    Grant programs-education, Indians-education, Reporting and 
recordkeeping requirements, Scholarships and fellowships.

    Dated: July 22, 1996.
Gerald N. Tirozzi,
Assistant Secretary for Elementary and Secondary Education.

(Catalog of Federal Domestic Assistance Numbers: 84.087 Indian 
Education--Fellowships for Indian Students; and 84.299 Indian 
Education--Special Programs.)

    The Secretary proposes to amend Title 34 of the Code of Federal 
Regulations by revising Part 263 to read as follows:

PART 263--INDIAN FELLOWSHIP AND PROFESSIONAL DEVELOPMENT PROGRAMS

Subpart A--General

Sec.
263.1  What are the Indian Fellowship and the Professional 
Development Programs?
263.2  Who is eligible to apply under the Indian Fellowship Program?
263.3  What definitions apply to the Indian Fellowship and 
Professional Development Programs?
263.4  What are the allowable fields of study in the Indian 
Fellowship Program?
263.5  What does a fellowship award include?
263.6  What is the time period for a fellowship award?

Subpart B--How Does the Secretary Select Fellows?

263.20  What priority is given to certain applicants?
263.21  What should the fellowship application contain?
263.22  How does the Secretary evaluate applications?

[[Page 39248]]

Subpart C--What Conditions Must be Met by Fellows?

263.30  What are the basic requirements of a fellow?
263.31  What information must be submitted after a fellowship is 
awarded?
263.32  What are the requirements for a leave of absence?
263.33  What is required for continued funding under a fellowship?
263.34  When is a fellowship discontinued?
263.35  What are the payback requirements?
263.36  When does payback begin?
263.37  What are the payback reporting requirements?

Subpart D--How Are Fellowship Payments Made?

263.40  How are payments made?

    Authority: 20 U.S.C. 7832 and 7833, unless otherwise noted.

Subpart A--General


Sec. 263.1  What are the Indian Fellowship and the Professional 
Development Programs?

    (a) The Indian Fellowship Program provides fellowships to enable 
Indian students to pursue a course of study leading to--
    (1) A postbaccalaureate degree in medicine, law, education, 
psychology, clinical psychology, or a related field; or
    (2) An undergraduate or postbaccalaureate degree in business 
administration, engineering, natural resources, or a related field.
    (b) The Professional Development Program provides grants to 
eligible entities to--
    (1) Increase the number of qualified Indian individuals in 
professions that serve Indian people;
    (2) Provide training to qualified Indian individuals to become 
teachers, administrators, teacher aides, social workers, and ancillary 
educational personnel; and
    (3) Improve the skills of qualified Indian individuals who serve in 
the capacities described in paragraph (b)(2) of this section.
    (c) The Indian Fellowship and the Professional Development Programs 
require individuals who receive training under either program to--
    (1) Perform work that is related to the training received under 
either program and that benefits Indian people or to repay all or a 
prorated part of the assistance received under the program; and
    (2) Report to the Secretary on the individual's compliance with the 
work requirement.

(Authority: 20 U.S.C. 7832 and 7833)


Sec. 263.2  Who is eligible to apply under the Indian Fellowship 
Program?

    In order to be eligible for a fellowship, an applicant must be--
    (a) An Indian as defined in Sec. 263.3;
    (b) A United States citizen;
    (c) Currently in attendance or have been accepted for admission as 
a full-time undergraduate or graduate student at an accredited 
institution of higher education in one of the fields listed in 
Sec. 263.4 or a related field;
    (d) Recognized by the institution as a degree candidate; and
    (e) Eligible under 34 CFR 75.60.

(Authority: 20 U.S.C. 7833; 20 U.S.C. 1221e-3(a)(1) and 3474)


Sec. 263.3  What definitions apply to the Indian Fellowship and 
Professional Development Programs?

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

Department
Secretary

    (b) Other definitions. The following definitions also apply to this 
part:
    Dependent allowance means costs for the care of minor children who 
reside with the fellow and for whom the fellow has responsibility.
    Expenses means tuition and required fees; required university 
health insurance; room, personal living expenses, and board at or near 
the institution; dependent allowance; instructional supplies; and 
reasonable travel and research costs associated with doctoral 
dissertation completion.
    Fellow means the recipient of a fellowship under the Indian 
Fellowship Program. The term ``fellow'' also includes individual 
project participants under the Professional Development Program with 
regard to the payback provisions contained in Secs. 263.35 through 
263.37.
    Fellowship means an award under the Indian Fellowship Program.
    Full course load means the number of credit hours that the 
institution requires of a full-time student.
    Full-time student means a student who--
    (1) Is a degree candidate;
    (2) Carries a full course load; and
    (3) Is not employed for more than 20 hours a week.
    Good standing means a cumulative grade point average of at least 
2.0 on a 4.0 grade point scale in which failing grades are computed as 
part of the average, or another appropriate standard established by the 
institution.
    Graduate degree means a postbaccalaureate degree awarded by an 
institution of higher education beyond the undergraduate level.
    Indian means an individual who is--
    (1) A member of an Indian tribe or band, as membership is defined 
by the Indian tribe or band, including any tribe or band terminated 
since 1940, and any tribe or band recognized by the State in which the 
tribe or band resides; or
    (2) A descendant, in the first or second degree, of an individual 
described in paragraph (1) of this definition; or
    (3) Considered by the Secretary of the Interior to be an Indian for 
any purpose; or
    (4) An Eskimo, Aleut, or other Alaska Native; or
    (5) A member of an organized Indian group that received a grant 
under the Indian Education Act of 1988 as it was in effect on October 
19, 1994.
    Institution of higher education means an accredited college or 
university within the United States that offers a baccalaureate or 
postbaccalaureate degree.
    Payback means work-related service or cash reimbursement to the 
Department of Education for the training received under the Indian 
Fellowship or the Professional Development Program.
    Stipend means that portion of an award that is used for room and 
board and personal living expenses.
    Undergraduate degree means a baccalaureate (bachelor's) degree 
awarded by an institution of higher education.

(Authority: 20 U.S.C. 7832, 7833, and 7881)


Sec. 263.4  What are the allowable fields of study in the Indian 
Fellowship Program?

    (a) The following are allowable fields for an undergraduate degree 
under this program:
    (1) Business administration.
    (2) Engineering.
    (3) Natural resources.
    (b) The following are allowable fields for a graduate degree under 
this program:
    (1) Medicine.
    (2) Clinical psychology.
    (3) Law.
    (4) Education.
    (5) Psychology.
    (6) Engineering.
    (7) Natural resources.
    (8) Business administration.
    (c) The Secretary considers under paragraphs (a) and (b) of this 
section, on a case-by-case basis, the eligibility of applications for 
fellowships in related fields of study.

(Authority: 20 U.S.C. 7833)


Sec. 263.5  What does a fellowship award include?

    (a) The Secretary awards a fellowship in an amount up to, but not 
more than, the expenses as defined in this part. The assistance 
provided by the program either--

[[Page 39249]]

    (1) Fully finances a student's educational expenses; or
    (2) Supplements other sources of financial aid, including other 
Federal financial aid other than loans, for meeting educational 
expenses.
    (b) The Secretary announces the expected maximum amounts for 
subsistence and other fellowship costs in the annual application notice 
published in the Federal Register.

(Authority: 20 U.S.C. 7833)

Sec. 263.6  What is the time period for a fellowship award?

    (a) The Secretary awards a fellowship for a period of time not 
exceeding--
    (1) Four academic years for an undergraduate or doctorate degree; 
and
    (2) Two academic years for a master's degree.
    (b) With prior approval from the Secretary, summer school may be 
allowed for eligible continuation students after completion of the 
first academic year.

(Authority: 20 U.S.C. 7833)

Subpart B--How Does the Secretary Select Fellows?


Sec. 263.20  What priority is given to certain applicants?

    The Secretary awards not more than 10 percent of the fellowships, 
on a priority basis, to persons receiving training in guidance 
counseling with a specialty in the area of alcohol and substance abuse 
counseling and education.

(Authority: 20 U.S.C. 7833)


Sec. 263.21  What should the fellowship application contain?

    In addition to the requirements specified in Sec. 263.22, an 
applicant shall provide--
    (a) Evidence that the applicant is an Indian as defined in 
Sec. 263.3. Evidence may be in the form of--
    (1)(i) A copy of the applicant's documentation of tribal enrollment 
or membership; or
    (ii) A copy of the parent's or grandparent's documentation of 
tribal enrollment or membership, with supporting birth certificates or 
similar documents showing the applicant's descendance from the enrolled 
member;
    (2) A letter of certification on official letterhead with the 
appropriate signature from a federally or State recognized tribe or 
band; or
    (3) A certificate of degree of Indian blood (CDIB) issued by an 
authorized representative of the Bureau of Indian Affairs or an 
official of a federally recognized tribe;
    (b)(1) Evidence that the applicant is currently in attendance or 
has been accepted for admission as a full-time student at an accredited 
institution of higher education in one of the eligible fields of study 
listed in Sec. 263.4; or
    (2) For an applicant who has not yet been accepted for admission, 
documentation of having been accepted by an accredited institution of 
higher education by a date to be specified by the Secretary;
    (c)(1) The most current official high school and, if appropriate, 
undergraduate transcripts for undergraduate applicants; or
    (2) The most current official undergraduate and, if appropriate, 
graduate transcripts for graduate applicants;
    (d) The certification required under 34 CFR 75.61; and
    (e) The certification contained within the application regarding 
agreement to fulfill the requirements of the payback provision that is 
signed and dated by the applicant.

(Authority: 20 U.S.C. 7833; 20 U.S.C. 1221e-3(a)(1) and 3474).


Sec. 263.22  How does the Secretary evaluate applications?

    (a) The Secretary reviews and ranks an application with other 
applications for the same field and related fields of study.
    (b) The following criteria, with the total number of points 
available in parenthesis, are used to evaluate an application for a new 
fellowship award:
    (1) Official academic record (60 points). The Secretary considers 
the quality of the applicant's academic record by reviewing--
    (i) The applicant's grade point average and, if applicable, scores 
from such standardized tests as the Scholastic Aptitude Test (SAT), 
American College Testing Assessment Program (ACT), Graduate Record 
Examination (GRE), Law School Admissions Test (LSAT), Medical College 
Admission Test (MCAT), and achievement tests; and
    (ii) The applicant's official transcripts and any grade reports.
    (2) Letters of recommendation (15 points). The Secretary considers 
the applicant's potential for success in completing the academic 
requirements for his or her field of study by reviewing one letter of 
recommendation from each of the following categories:
    (i) A school principal, teacher, academic or non-academic 
instructor or counselor, a college professor, or academic advisor.
    (ii) A member of the community or civic leader who has observed the 
applicant in educational, social, or civic activities.
    (iii) A tribal representative or an Indian community member.
    (3) Commitment essay (25 points). The Secretary considers the 
applicant's commitment by reviewing an essay, written by the applicant 
that addresses--
    (i) The applicant's career goals and why the chosen field of study 
will benefit Indian people;
    (ii) The applicant's life experiences and personal and family 
expectations that will enhance the applicant's anticipated career 
accomplishments; and
    (iii) The applicant's anticipated commitment to providing service 
to Indian people.

(Authority: 20 U.S.C. 7833)

Subpart C--What Conditions Must be Met by Fellows?


Sec. 263.30  What are the basic requirements of a fellow?

    A fellow shall--
    (a) Start school during the first semester of the award at the 
institution named on the grant award document and complete at least one 
full academic term;
    (b) Submit to the Secretary two copies of his or her official grade 
report at the close of each academic term and upon completion of the 
training program at that institution;
    (c) Submit an annual continuation application, in the form and 
timeframes specified by the Secretary, to request funding for each 
remaining academic year approved under the initial application;
    (d) Request from the Secretary a written leave of absence at least 
30 days prior to withdrawal, unless an emergency situation has 
occurred, for any interruption in his or her program of academic 
studies; and
    (e) Sign an agreement with the Department to meet the provisions of 
the payback requirement.

(Authority: 20 U.S.C. 7833)


Sec. 263.31  What information must be submitted after a fellowship is 
awarded?

    To verify further the accuracy of the information provided in the 
application, the applicant shall provide all information and documents 
as requested by the Secretary, including information on other financial 
aid sources for educational purposes. The applicant's failure to 
provide the requested information and documents invalidates the 
application, and the Secretary will not consider it for funding.


[[Page 39250]]


(Authority: 20 U.S.C. 7833)


Sec. 263.32  What are the requirements for a leave of absence?

    (a) The Secretary may approve a leave of absence for a period not 
longer than one academic year if a fellow has successfully completed at 
least one academic year.
    (b) A written request for a leave of absence must be submitted to 
the Secretary not less than 30 days prior to withdrawal or completion 
of a grading period, unless an emergency situation has occurred and the 
Secretary waives the prior notification requirement.
    (c) The Secretary permits a leave of absence only if the 
institution certifies that the fellow is eligible to resume his or her 
course of study at the end of the leave of absence.
    (d) The Secretary withdraws any remaining funds of the fellow's 
award if a leave of absence occurs prior to the end of an academic 
term.

(Authority: 20 U.S.C. 7833)


Sec. 263.33  What is required for continued funding under a fellowship?

    (a) The Secretary reviews the status of each fellow at the end of 
each year and continues support only if the fellow--
    (1) Has complied with requirements under this part;
    (2) Has remained a full-time student in good standing in the field 
in which the fellowship was awarded; and
    (3) Has submitted a noncompeting continuation application 
requesting additional support.
    (b) A fellowship terminates when the fellow receives the degree 
being sought or after the fellow has received the fellowship for the 
maximum number of years allowed as defined in Sec. 263.6, whichever 
comes first.

(Authority: 20 U.S.C. 7833)


Sec. 263.34  When is a fellowship discontinued?

    (a) The Secretary may discontinue the fellowship if the fellow--
    (1) Fails to comply with the provisions under this part, including 
failure to obtain an approved leave of absence under Sec. 263.32, or 
with the terms and conditions of the fellowship award; or
    (2) Fails to report any change in his or her academic status.
    (b) The Secretary discontinues a fellowship only after providing 
reasonable notice and an opportunity for the fellow to rebut, in 
writing or in an informal meeting with the responsible official in the 
Department of Education, the basis for the decision.

(Authority: 20 U.S.C. 7833)


Sec. 263.35  What are the payback requirements?

    (a) Individuals receiving assistance under the Indian Fellowship 
Program or the Professional Development Program are required to--
    (1) Perform work related to the training received and that benefits 
Indian people; or
    (2) Repay all or a prorated part of the assistance received.
    (b) The period of time required for a work-related payback is 
equivalent to the total period of time for which training was actually 
received under the Indian Fellowship Program or the Professional 
Development Program.
    (c) The cash payback required must be equivalent to the total 
amount of funds received and expended for training received under 
either of these programs and may be prorated based on any approved 
work-related service the participant performs.

(Authority: 20 U.S.C. 7832 and 7833)


Sec. 263.36  When does payback begin?

    (a) For all fellows who complete their training under the Indian 
Fellowship Program or the Professional Development Program, except for 
medical degree and doctoral degree candidates, payback must begin 
within six months from the date of completion of the training.
    (b) For fellows in a doctoral degree program requiring a 
dissertation, payback must begin not later than two years after the 
program's academic course work has been completed or the institution 
determines the student is no longer eligible to participate in the 
training program, whichever occurs first.
    (1) After academic course work has been completed, fellows in a 
doctoral degree program shall submit an annual written report to the 
Secretary on the status of the dissertation.
    (2) Within 30 days of completion of the dissertation, fellows in a 
doctoral degree program shall provide written notification to the 
Secretary of completion of the dissertation and of the participant's 
plans for completing a work-related or cash payback.
    (c) For fellows in a doctoral degree program with clinical or 
internship requirements, payback must begin within six months after the 
clinical or internship requirements have been met or the institution 
determines the student is no longer eligible to participate in the 
training program, whichever occurs first.
    (1) After academic course work has been completed, fellows in a 
doctoral degree program with clinical or internship requirements shall 
submit an annual written report to the Secretary on the status of 
completion of the clinical or internship requirements.
    (2) Within 30 days of completion of the clinical or internship 
requirements, fellows shall provide written notification to the 
Secretary of completion of those requirements and the participant's 
plans for completing a work-related or cash payback.
    (d) For fellows in a medical degree program, payback must begin six 
months from the date that all residency requirements of the program 
have been met or the institution determines the student is no longer 
eligible to participate in the training program, whichever occurs 
first.
    (1) After academic course work has been completed, fellows in a 
medical degree program shall submit an annual written report to the 
Secretary on the status of completion of the residency requirements of 
the program.
    (2) Within 30 days of completion of the residency requirements, 
fellows in a medical degree program shall provide written notification 
to the Secretary of completion of the residency requirements and of the 
participant's plans for completing a work-related or cash payback.
    (e) For fellows who do not complete their training under the Indian 
Fellowship Program or the Professional Development Program, payback 
must begin within six months from the date the fellow leaves the Indian 
Fellowship Program or the Professional Development Program, unless he 
or she continues as a full-time student, without interruption, in a 
program leading to a degree in an accredited institution of higher 
education.
    (1) If the fellow leaves the Indian Fellowship Program or the 
Professional Development Program, but plans to continue his or her 
education as a full-time student, the Secretary may defer the payback 
requirement until the participant has completed his or her educational 
program. Written requests for deferment must be submitted to the 
Secretary within 30 days of leaving the Indian Fellowship Program or 
the Professional Development Program and must provide the following 
information:
    (i) The name of the accredited institution the student will be 
attending.
    (ii) A copy of the letter of admission from the institution.
    (iii) The degree being sought.
    (iv) The projected date of completion.
    (2) After approval by the Secretary of the deferment of the payback 
provision on the basis of continuing as a full-time student, former 
fellows are required to submit to the Secretary, after every grading 
period, a status report from an

[[Page 39251]]

academic advisor or other authorized representative of the institution 
of higher education showing verification of enrollment and status.

(Authority: 20 U.S.C. 7832 and 7833)


Sec. 263.37  What are the payback reporting requirements?

    (a) Written notice. Participants shall submit to the Secretary, 
within 30 days of completion of their training program, a written 
notice of intent to complete a work-related or cash payback or to 
continue in a degree program as a full-time student.
    (b) Work-related payback. If the participant proposes a work-
related payback, the written notice of intent must include information 
explaining how the work-related service is related to the training 
received and benefits Indian people.
    (1) For work-related service, the Secretary reviews each 
participant's payback plan to determine if the work-related service is 
related to the training received and benefits Indian people. The 
Secretary approves the payback plan if a determination is made that the 
work-related service to be performed is related to the training 
received and benefits Indian people, meets all applicable statutory and 
regulatory requirements, and is otherwise appropriate.
    (2) The payback plan for work-related service must identify where, 
when, the type of service, and for whom the work will be performed.
    (3) A participant shall notify the Secretary in writing of any 
change in the work-related service being performed within 30 days of 
such a change.
    (4) For work-related payback, individuals shall submit a status 
report every six months beginning from the date the work-related 
service is to begin. The reports must include a certification from the 
participant's employer that the service or services have been performed 
without interruption.
    (5) Upon written request, and if appropriate, the Secretary may 
extend the period for completing a work-related payback by a total of 
18 months.
    (6) For participants who initiate, but cannot complete, a work-
related payback, the payback reverts to a cash payback.
    (c) Cash payback. If a cash payback is to be made, the Department 
will contact the participant to establish an appropriate schedule for 
payments.

(Authority: 20 U.S.C. 7832 and 7833)

Subpart D--How Are Fellowship Payments Made?


Sec. 263.40  How are payments made?

    (a) Fellowship payments are made directly to the institution of 
higher education where a fellow is enrolled, with stipends provided to 
the fellow in installments by the institution. No fewer than two 
installments per academic year may be made.
    (b) If a fellow transfers to another institution, the fellowship 
may also be transferred provided the fellow maintains basic eligibility 
for the award.
    (c) A fellow who officially or unofficially withdraws or is 
expelled from an institution before completion of a term shall refund a 
prorated portion of the stipends received, as determined by the 
Secretary. The Secretary requires the institution to return any 
unexpended funds.

(Authority: 20 U.S.C. 7833)

[FR Doc. 96-18917 Filed 7-25-96; 8:45 am]
BILLING CODE 4000-01-P