[Federal Register Volume 61, Number 170 (Friday, August 30, 1996)]
[Rules and Regulations]
[Pages 46338-46342]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-22216]



[[Page 46337]]


_______________________________________________________________________

Part VII





Department of Education





_______________________________________________________________________



34 CFR Part 263



Indian Fellowship and Professional Development Programs; Final Rule

  Federal Register / Vol. 61, No. 170 / Friday, August 30, 1996 / Rules 
and Regulations  

[[Page 46338]]



DEPARTMENT OF EDUCATION

34 CFR Part 263

RIN 1810-AA79


Indian Fellowship and Professional Development Programs

AGENCY: Department of Education.

ACTION: Final regulations.

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

SUMMARY: The Secretary amends the regulations governing 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 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 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.

EFFECTIVE DATE: These regulations take effect September 29, 1996.

FOR FURTHER INFORMATION CONTACT: Cathie Martin, U.S. Department of 
Education, 600 Independence Avenue, SW., Room 4300 Portals Building, 
Washington, DC 20202-6335. 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 
regulations 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 regulations. The selection criteria in the Education 
Department General Administrative Regulations (EDGAR), 34 CFR part 75, 
are used for competitions under the Professional Development Program.
    In addition, certain of these regulations 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.
    These regulations apply to all FY 1996 awards, both new and 
continuation, and subsequent fiscal years' awards.
    On July 26, 1996 the Secretary published a notice of proposed 
rulemaking (NPRM) for these programs in the Federal Register (61 FR 
39246). Except for minor editorial and technical revisions, there are 
no differences between the NPRM and these final regulations.

Public Comment

    In the NPRM the Secretary invited comments on the proposed 
regulations. The Secretary did not receive any comments.

Paperwork Reduction Act of 1995

    Under the Paperwork Reduction Act of 1995, no persons are required 
to respond to a collection of information unless it displays a valid 
OMB control number. The valid OMB control number assigned to the 
collection of information in these final regulations is displayed at 
the end of the affected sections of the 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.

Assessment of Educational Impact

    In the notice of proposed rulemaking, the Secretary requested 
comments on whether the proposed regulations would require transmission 
of information that is being gathered by or is available from any other 
agency or authority of the United States.
    Based on the response to the proposed rules and on its own review, 
the Department has determined that the regulations in this document do 
not require transmission of information that is being gathered by or is 
available from any other agency or authority of the United States.

List of Subjects in 34 CFR Part 263

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

    Dated: August 27, 1996.

(Catalog of Federal Domestic Assistance Numbers: 84.087 Indian 
Education--Fellowships for Indian Students; and 84.299 Indian 
Education--Special Programs.)
Gerald N. Tirozzi,
Assistant Secretary for Elementary and Secondary Education.
    The Secretary amends 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?

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?

[[Page 46339]]

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--
    (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.

[[Page 46340]]

    (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.

(Approved by the Office of Management and Budget under control 
number 1810-0020)

(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.

(Approved by the Office of Management and Budget under control 
number 1810-0020)

(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.

(Approved by the Office of Management and Budget under control 
number 1810-0020)

(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.

(Approved by the Office of Management and Budget under control 
number 1810-0020)

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

[[Page 46341]]

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.

(Approved by the Office of Management and Budget under control 
number 1810-0020)

(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.

(Approved by the Office of Management and Budget under control 
number 1810-0020)

(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.

(Approved by the Office of Management and Budget under control 
number 1810-0020)

(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

[[Page 46342]]

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

(Approved by the Office of Management and Budget under control 
number 1810-0020)

(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.

(Approved by the Office of Management and Budget under control 
number 1810-0020)

(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. 96-22216 Filed 8-29-96; 8:45 am]
BILLING CODE 4000-01-P