[Federal Register Volume 73, Number 103 (Wednesday, May 28, 2008)]
[Notices]
[Pages 30688-30709]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E8-11852]



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Part III





Department of Education





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Compliance Agreement; Notice

  Federal Register / Vol. 73, No. 103 / Wednesday, May 28, 2008 / 
Notices  

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DEPARTMENT OF EDUCATION


Compliance Agreement

AGENCY: Department of Education.

ACTION: Notice of written findings and compliance agreement with the 
Commonwealth of Puerto Rico and the Puerto Rico Department of 
Education.

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SUMMARY: This notice is being published in the Federal Register 
consistent with section 457(b)(2) of the General Education Provisions 
Act (GEPA). Section 457 of GEPA authorizes the U.S. Department of 
Education (the Department) to enter into a compliance agreement with a 
recipient that is failing to comply substantially with Federal program 
requirements, and for whom the Department determines that full 
compliance is not feasible until a future date. Section 457(b)(2) 
requires the Department to publish written findings leading to a 
compliance agreement, with a copy of the compliance agreement, in the 
Federal Register. If a recipient fails to comply with the terms and 
conditions of a compliance agreement, the Secretary may take any action 
authorized by law with respect to the recipient.
    On December 17, 2007, the Department entered into a three-year 
compliance agreement (the Agreement) with the Commonwealth of Puerto 
Rico (Puerto Rico) and the Puerto Rico Department of Education (PRDE) 
because PRDE was failing to comply substantially with numerous Federal 
education program requirements, and it was clear to the Department from 
all available information that PRDE would not be able to come into full 
compliance with applicable Federal requirements for the administration 
of Department programs until a future date.
    PRDE receives grant funds under a number of programs administered 
by the Department, including programs authorized under Titles I, II, 
and IV of the Elementary and Secondary Education Act of 1965, as 
amended by the No Child Left Behind Act of 2001 (ESEA), Title IV of the 
Higher Education Act of 1965, as amended (HEA), and the Individuals 
with Disabilities Education Act (IDEA). As a result of program 
monitoring and audits, the Department has identified numerous program 
areas requiring corrective action by PRDE. Specifically, the Agreement 
applies to grant funds awarded to Puerto Rico and PRDE by the 
Department under Titles I, II, and IV of ESEA, Title IV of HEA, and 
IDEA. The purpose of the Agreement is to improve education for the 
students of Puerto Rico by bringing Puerto Rico and PRDE into full 
compliance with the Department's program requirements.

FOR FURTHER INFORMATION CONTACT: Mr. Phil Maestri, U.S. Department of 
Education, Office of the Secretary, 400 Maryland Avenue, SW., room 
7E206, Washington, DC 20202-6132. Telephone: (202) 205-3511.
    If you use a telecommunications device for the deaf (TDD), you may 
call the Federal Relay Service (FRS) at 1-800-877-8339.
    Individuals with disabilities may obtain this document in an 
alternative format (e.g., Braille, large print, audiotape, or computer 
diskette) on request to the contact person listed under FOR FURTHER 
INFORMATION CONTACT.

SUPPLEMENTARY INFORMATION: In recent years, PRDE has been putting forth 
efforts and working, with technical assistance provided by the 
Department, to make important changes to improve education services to 
Puerto Rico's students in accordance with special conditions the 
Department has imposed on PRDE's grants. These efforts were part of an 
initiative undertaken in 2003 between PRDE and the Department, under 
the Department's Cooperative Audit Resolution and Oversight Initiative 
(CAROI), and under a compliance agreement entered into by the 
Department and PRDE in October 2004 (October 2004 Compliance Agreement) 
(see 72 FR 60186-99).
    The October 2004 Compliance Agreement primarily addressed systemic 
problems in PRDE's program administration and management of Federal 
education funds in areas such as grants management, payroll, financial 
management, property management and procurement. The Department 
identified these systemic problems through numerous audits of PRDE that 
it conducted beginning in 1994. Subsequently, in the process of 
monitoring PRDE's implementation of various Department programs, the 
Department identified significant programmatic issues under a number of 
PRDE's education programs, including programs authorized under Titles 
I, II, and IV of ESEA, Title IV of HEA, and IDEA. The Department 
determined that these significant programmatic issues rose to the level 
of programmatic non-compliance by PRDE.
    In accordance with the requirements of section 457(b) of GEPA, 20 
U.S.C 1234f(b), on October 26, 2007, Department officials conducted a 
public hearing in Puerto Rico to assess whether a compliance agreement 
with Puerto Rico and PRDE addressing the numerous areas of programmatic 
non-compliance might be appropriate. Witnesses representing PRDE and 
other concerned individuals testified at this hearing. The Department 
considered the testimony provided at the October 2007 public hearing 
and all other relevant information and materials and concluded that 
PRDE would not be able to correct the areas of programmatic non-
compliance immediately and would need more than one year to correct the 
identified programmatic deficiencies.
    Therefore, the Department, Puerto Rico and PRDE entered into a 
comprehensive compliance agreement with a three-year term. The 
Agreement, which incorporates and reflects the Department's written 
findings based on the hearing testimony and other relevant information 
and materials, gives PRDE three years to develop effective, long-term 
solutions to problems in the performance and administration of its 
Department programs. Under the terms of the Agreement, by the end of 
the three-year term of the Agreement, PRDE must be in full compliance 
with the requirements of all programs funded by the Department.
    As required by section 457(b)(2) of GEPA, 20 U.S.C. 1234f(b)(2), 
the Agreement (which incorporates the Department's written findings in 
the section entitled ``Overview of Issues Addressed by this Compliance 
Agreement'') is set forth as Appendix A of this notice.

Electronic Access to This Document

    You may view this document, as well as all other Department of 
Education documents published in the Federal Register, in text or Adobe 
Portable Document Format (PDF) on the Internet at the following site: 
http://www.ed.gov/news/fedregister.
    To use PDF you must have the Adobe Acrobat Reader , which is 
available free at this site. If you have questions about using PDF, 
call the U.S. Government Printing Office (GPO), toll free, at 1-888-
293-6498; or in the Washington, DC area at (202) 512-1530.

    Note: The official version of a document is the document 
published in the Federal Register. Free Internet access to the 
official edition of the Federal Register and the Code of Federal 
Regulations is available on GPO Access at: http://www.gpoaccess.gov/nara/index.html.

 [FEDREG][VOL]*[/VOL][NO]*[/NO][DATE]*[/
    DATE][NOTICES][NOTICE][PREAMB][AGENCY]*[/AGENCY][SUBJECT]*[/SUBJECT]
(Authority: 20 U.S.C. 1234c, 1234f)


[[Page 30689]]


    Dated: May 16, 2008.
David Dunn,
Chief of Staff for the Office of the Secretary.

Appendix A--Compliance Agreement Among the Commonwealth of Puerto Rico, 
the Puerto Rico Department of Education, and the United States 
Department of Education, December 17, 2007

I. Overview

Purpose of and Issues Addressed By This Compliance Agreement

    The purpose of this Agreement is to improve education for the 
students of Puerto Rico by bringing the Commonwealth of Puerto Rico 
(Puerto Rico) and the Puerto Rico Department of Education (PRDE) into 
full compliance with program requirements of the U.S. Department of 
Education (the Department) (Puerto Rico, PRDE, and the Department shall 
hereafter collectively be referred to as ``the Parties''). The 
Department awards grants to PRDE under a number of Federal education 
programs. As a result of program monitoring and audits, the Department 
has identified several program areas requiring corrective action by 
PRDE. The programs under which PRDE receives funds from the Department 
and in which corrective action is necessary, include Titles I, II, and 
IV of the Elementary and Secondary Education Act (ESEA), Title IV of 
the Higher Education Act of 1965, and the Individuals with Disabilities 
Education Act (IDEA) (hereafter ``covered Federal programs'').
    In recent years, PRDE has been putting forth efforts to make 
important changes to improve education services to Puerto Rico's 
students in accordance with special conditions imposed by the 
Department on PRDE's grants, with technical assistance provided by the 
Department. These efforts were part of an initiative undertaken in 2003 
between PRDE and the Department, under the Department's Cooperative 
Audit Resolution and Oversight Initiative (CAROI), and under a 
Compliance Agreement entered into by the Department and PRDE in October 
2004. The October 2004 Compliance Agreement primarily addressed 
systemic problems in PRDE's program administration and management of 
Federal education funds. Those problems were uncovered and identified 
by numerous audits of PRDE beginning in 1994.
    With regard to the more recent program compliance issues uncovered 
by the Department's monitoring of PRDE's Federal programs, it appears 
that it will take more than one year for PRDE to completely address 
those programmatic issues. It will also take more than one year to 
establish the continued cooperation of other parts of the Puerto Rico 
government in this effort, such as the Puerto Rico Department of the 
Treasury (Hacienda) and PRDE's Office of Management and Budget. 
Therefore, under the authority of section 457 of the General Education 
Provisions Act (GEPA), the Department is entering into this 
comprehensive, three-year Compliance Agreement (Agreement) with Puerto 
Rico and PRDE.
    Through this Agreement, Puerto Rico and PRDE, with technical 
assistance from the Department, agree to develop and implement 
solutions to PRDE's program performance and program implementation 
problems. These programmatic issues are being carefully examined and 
addressed from the perspective of PRDE and other Puerto Rico agencies 
with management responsibility for resources or programs that have an 
impact on education in Puerto Rico and on PRDE's administration of 
Federal education funds. Whatever the solutions Puerto Rico and PRDE 
have chosen to implement, as reflected in this Agreement, Puerto Rico 
and PRDE must ensure that their goal is to achieve the best educational 
systems possible for the students of Puerto Rico.
    This Agreement is also intended to ensure an effective planning and 
evaluation process throughout PRDE's programs and initiatives. Planning 
and evaluation processes are the basis for determining program goals, 
current status, improvement needs, budgets, resources, effectiveness of 
results, and other important aspects of effective program management. 
Through this Agreement, Puerto Rico and PRDE will improve program 
planning and evaluation for education programs and use the plans and 
evaluation results to drive management and resource decisions.
    This Agreement will allow PRDE time to develop and implement 
significant changes and improvements necessary to address the 
deficiencies that the Department has identified in PRDE's 
implementation of the covered Federal programs and to come into full 
compliance with identified Federal program requirements. At the end of 
this three-year period, PRDE must be in full compliance with all 
applicable program requirements in order to continue to receive Federal 
education funds under these programs.

Incorporation By Reference of Corrective Action Plans

    This Agreement lists specific tasks, goals, completion dates, and 
persons and offices responsible for carrying out specific tasks for 
each program area. Corrective Action Plans for each program area will 
contain action steps and sub-steps, measurable objectives, and detailed 
corresponding timelines. Under the terms of the Corrective Action 
Plans, PRDE and identified persons and offices will be responsible for 
addressing the underlying problems to be resolved by Puerto Rico's 
compliance with each task, goal, and action step. PRDE will submit a 
draft of each Corrective Action Plan to the Department by February 1, 
2008. The Department will respond to PRDE's drafts by February 20, 
2008. Following consultations and discussions, the plans will be 
completed by the Parties by March 15, 2008 and are incorporated into 
this Agreement by reference. The Corrective Action Plan for ESEA, Title 
I, Standards and Assessments, is complete and is incorporated by 
reference into this Agreement at its signing as Attachment A. 
Hereinafter, each reference in this Agreement to the ``Agreement,'' is 
intended to include the Corrective Action Plans. Failure by PRDE to 
come to agreement with the Department on specific Corrective Action 
Plans for each of the program areas covered in this Agreement will 
render each such section of this Agreement null and void.

Review of Progress

    The Department will review Puerto Rico's and PRDE's progress in 
meeting the terms of this Agreement by assessing how well Puerto Rico 
and PRDE design and implement solutions to the programmatic compliance 
issues in the covered Federal programs that are addressed below, by the 
demonstrated communication, cooperation, and organizational changes 
undertaken by Puerto Rico, PRDE, and other Puerto Rico agencies with 
management responsibility for Federal education funds, and by assessing 
Puerto Rico's and PRDE's completion of specific agreed-upon corrective 
action steps. The approaches adopted by Puerto Rico and PRDE should 
include effective planning and evaluation of resource and management 
decisions that are designed to result in compliance with all 
programmatic requirements by the end of the period covered by this 
Agreement, and to produce better educational results for Puerto Rico 
students.

[[Page 30690]]

    In making the changes required to meet the terms of this Agreement, 
it is important to understand that the Agreement is not only designed 
to bring about compliance with Federal programmatic requirements but to 
improve education for the students of Puerto Rico. The Department, 
Puerto Rico, and PRDE will judge the success of this Agreement by: 
determining whether PRDE has met all the terms of this Agreement, 
assessing whether PRDE is in compliance with all Federal programmatic 
requirements identified below, and determining how successful Puerto 
Rico has been overall in improving its educational programs.

II. Consequences of Not Meeting the Terms and Conditions of This 
Agreement

    There will be consequences should PRDE and Puerto Rico fail to meet 
the terms of this Agreement. Among possible consequences are:

A. Designation of PRDE as a ``High-Risk'' Grantee Under 34 CFR 80.12

    If, during the period covered by this Agreement, PRDE and Puerto 
Rico fail to demonstrate that they are making reasonable progress 
toward meeting the terms of this Agreement, or fail to demonstrate an 
active, good faith commitment to meeting the terms of this Agreement, 
the Department may exercise its authority to designate PRDE a ``high-
risk'' grantee. In addition, if, at the termination of this Agreement, 
PRDE has failed to come into compliance with the education program 
requirements addressed in this Agreement, the Department may exercise 
its authority to designate PRDE a ``high-risk'' grantee.
    As is addressed more fully below, if the Department chooses to 
designate PRDE as a ``high-risk'' grantee, additional special 
conditions or restrictions may include, but will not necessarily be 
limited to: (1) Payment of Federal funds on a reimbursement basis; (2) 
withholding the authority to proceed to the next phase of a program 
until receipt of evidence of acceptable performance within a given 
funding period; (3) requiring PRDE to submit to the Department 
additional, more detailed financial reports than those already being 
submitted in one or more programs; (4) requiring additional project 
monitoring; (5) requiring PRDE to obtain technical or management 
assistance, including the designation of a third-party fiduciary to 
administer all or part of PRDE's grants from the Department; or (6) 
establishing additional prior approvals. The use of a condition for one 
covered Federal program does not require or preclude its use for a 
different covered Federal program.
    In the event that the Department decides to designate PRDE as a 
``high-risk'' grantee, it would notify PRDE as early as possible, in 
writing, of the: (1) Nature of additional special conditions and 
restrictions; (2) reason(s) for imposing them; (3) corrective actions 
that must be taken before special conditions will be removed and time 
allowed for completing any additional corrective actions; and (4) 
method of requesting reconsideration of conditions and restrictions 
imposed.

B. Reimbursement Grant Payments

    For one or more covered Federal programs, the Department may decide 
to place PRDE on a cost reimbursement method of payment rather than on 
an advance payment method of payment. Cost reimbursement would require 
PRDE to submit to the Department receipts and other documentation 
necessary to support all PRDE program expenditures and the Department 
would release Federal program funds to PRDE only after approving each 
of PRDE's expenditures as allowable costs.

C. Requiring PRDE To Contract With a Third-Party Fiduciary To Oversee 
PRDE's Education Program Administration

    If, during the period covered by this Agreement, PRDE and Puerto 
Rico fail to demonstrate reasonable progress toward meeting the terms 
of this Agreement, fail to demonstrate an active, good faith commitment 
to meeting the terms of this Agreement, or fail to meet a significant 
term in this Agreement, the Department may place an appropriate amount 
of Puerto Rico's or PRDE's grant funds into an interest bearing escrow 
account to fund the duties of a third-party fiduciary agent and require 
PRDE and Puerto Rico to enter into a contract with a third-party 
fiduciary agent to assist PRDE and Puerto Rico with the administration 
of its Federal education grant programs.

D. Requiring PRDE To Operate One or More Programs Under the Terms of a 
Cooperative Agreement With the Department

    If, during the period covered by this Agreement, PRDE and Puerto 
Rico fail to demonstrate reasonable progress toward meeting the terms 
of this Agreement, fail to demonstrate an active, good faith commitment 
to meeting the terms of this Agreement, or fail to meet a significant 
term in this Agreement, under authority of the Federal Grant and 
Cooperative Agreement Act of 1977 (31 U.S.C. 6301-6308), the Department 
may determine that substantial involvement by the Department in PRDE's 
program grant administration is necessary in one or more covered 
Federal programs and award one or more education grants to PRDE under 
the terms of corresponding Cooperative Agreements, in lieu of issuing 
grant award notifications. If determined by the Department to be 
necessary, one or more Cooperative Agreements between the Department 
and PRDE will be drafted and their terms applied to the management of 
one or more projects, after which the Department will provide education 
program assistance to PRDE with the Department having substantial 
direct involvement in the management of the affected program 
project(s).
    Specifically, if the Department chooses to require PRDE to 
administer one or more of its covered Federal programs under the terms 
of a Cooperative Agreement, the relationship between the Department and 
PRDE will be characterized as follows:
    (1) The Department will halt a PRDE program activity immediately, 
if detailed performance specifications or requirements are not met;
    (2) The Department will review and approve one stage of work before 
PRDE can begin a subsequent stage during the period covered by the 
award;
    (3) The Department will review substantive provisions of PRDE's 
proposed contracts;
    (4) The Department will be directly involved in the selection of 
key PRDE personnel;
    (5) The Department will collaborate with PRDE or participate 
jointly with PRDE in program activities;
    (6) The Department will undertake monitoring that permits it to 
direct or redirect specific program work or activities, for example, 
because of interrelationships with other projects;
    (7) The Department will have substantial and direct operational 
involvement and participation in anticipated or planned projects, 
before an award is made, to ensure compliance with statutory 
requirements;
    (8) The Department will generally participate closely with PRDE in 
program administration in such a way as to exceed what is normally 
undertaken to comply with general statutory requirements that are a 
condition of every award; and
    (9) The Department will establish highly prescriptive requirements 
before an award is made, so as to limit PRDE's discretion with respect 
to the scope of services offered, organizational

[[Page 30691]]

structure, staffing, mode of operations and other management processes.

E. Withholding, Termination, or Suspension of Grant Funds--20 U.S.C. 
1234c(a)(1), 1234d, and 1416

    If the Department finds, after reasonable notice and after 
providing PRDE and Puerto Rico with an opportunity for a hearing, that 
PRDE has failed to comply with a requirement of law, including with 
those program requirements specifically identified and discussed in 
this Agreement, the Department may, after notifying Puerto Rico or 
PRDE, withhold future grant payments in whole or in part, or terminate 
one or more of PRDE's grants. The Department may limit withholding to a 
particular Federal grant or part of a grant.

F. Recovery of Funds Under Authority of 20 U.S.C. 1234a

    Any program funds improperly expended by PRDE or not properly 
accounted for by PRDE will be subject to recovery by the Department 
under authority of 20 U.S.C. Sec.  1234a.

G. Judicial Enforcement

1. Cease and Desist Order Under 20 U.S.C. 1234c(a)(2) and 1234e
    The Department may seek injunctive relief to compel specific 
actions or to stop specific actions. Under this process, the Department 
issues a complaint to Puerto Rico or PRDE, describing the factual and 
legal basis for the Department's belief that Puerto Rico or PRDE is 
failing to comply with a requirement of law, including this Agreement, 
and containing a notice of hearing. A hearing before an Administrative 
Law Judge (ALJ) could then occur. The ALJ's report and order, requiring 
Puerto Rico or PRDE to stop specific actions or compelling specific 
actions, becomes the final agency decision. The Department may enforce 
the final order by withholding any portion of Puerto Rico's or PRDE's 
grant award or certifying the facts to the U.S. Attorney General who 
may bring an appropriate action for enforcement of the order.
2. Referral to the U.S. Department of Justice for Appropriate 
Enforcement--20 U.S.C. 1416
    If the Department finds that Puerto Rico or PRDE has failed to 
comply with any provision of applicable Federal laws (with regard to 
the programs to which 20 U.S.C. 1416 applies) (including with the terms 
and timelines of this Agreement), the Department may, after notifying 
Puerto Rico or PRDE, refer the matter for an appropriate enforcement 
action, which may include referral to the U.S. Department of Justice.

III. Mutual Agreements and Understandings Regarding the Terms, 
Conditions, and Enforcement of This Compliance Agreement

Presentation of Documents, Reports, and Other Materials in English

    PRDE will submit all documentation, reports, summaries, updates, or 
other materials to the Department under the terms of this Agreement, to 
demonstrate progress toward compliance with the terms of this 
Agreement, in English. In the case of original supporting documents 
written in Spanish, PRDE will, to the extent reasonable and as mutually 
agreed upon by the Parties, provide such documents to the Department 
accompanied by translations from Spanish to English that are attested 
to by PRDE.

Criteria for Determining Compliance and Consequences of Non-Compliance

    Puerto Rico or PRDE will provide the Department with progress 
reports--as required in Section IV below--for the action steps set 
forth in this Agreement. Puerto Rico, PRDE, and the Department agree 
that a failure to: (1) Provide all required reports in a timely manner, 
(2) show progress in completing action steps, as required by this 
Agreement, (3) complete action steps within the timeframes designated 
in this Agreement, or (4) achieve critical measurable objectives as 
specified in the Corrective Action Plans incorporated into this 
Agreement, will be considered a failure to meet the terms and 
conditions of this Agreement.

Severability

    The Parties agree that this Agreement includes terms and conditions 
that apply to the various Federal programs included in the Agreement. 
To that end, the Parties agree that each such term and condition for 
each covered Federal program may constitute a separate agreement among 
Puerto Rico, PRDE, and the Department. For purposes of 20 U.S.C. 1234f, 
each such term or condition as to each covered Federal program shall be 
severable from each other term or condition for each of the covered 
Federal programs. Unless set out otherwise, a determination by the 
Department under 20 U.S.C. 1234f (d) that Puerto Rico or PRDE is not 
meeting terms and conditions may be specific to such term, condition, 
or program without impacting Puerto Rico's or PRDE's continuing 
obligations under this Agreement. That is, all other terms and 
conditions for all covered Federal programs or the specific term or 
condition for other covered Federal programs would remain in place for 
the duration of the Agreement, or until such time as the Department 
were to determine that Puerto Rico or PRDE had failed to meet those 
terms and conditions.
    Alternatively, the Parties understand and agree that a 
determination by the Department under 20 U.S.C. 1234f(d) that Puerto 
Rico or PRDE has failed to meet any of the terms and conditions shall, 
at the Department's discretion, be grounds for finding the Agreement, 
as to such terms and conditions, no longer in effect and that the 
Department may take any and all additional actions authorized by law. 
At the same time, if Puerto Rico or PRDE fails to meet the terms and 
conditions of this Agreement, the Department may terminate the entire 
Agreement, and may take any and all actions authorized by law. Some 
examples of such actions are set forth above.

Fraudulent Activity

    In the event that fraudulent activity in the administration of 
Federal education funds in Puerto Rico is uncovered in one or more 
programs--by an independent audit, PRDE's Internal Audit Office, the 
Department's Office of Inspector General, a Department program review 
team, a Department monitoring team, or by any other party--the terms of 
this Agreement pertaining to the affected program may be deemed null 
and void. In addition, in the event that such fraudulent activity is 
uncovered, following written notice to PRDE, the Department will take 
whatever actions it deems appropriate, including withholding Federal 
funds for the affected program.

IV. Reporting Requirements

    Under this Agreement, PRDE agrees to submit regular progress 
reports covering all program and performance issues. Generally, and 
unless the Department requires more frequent reporting, Puerto Rico and 
PRDE must provide the Department with progress reports on a quarterly 
basis.
    PRDE's submission of each written report will be preceded by a 
meeting or conference call among representatives of Puerto Rico (which 
may include representatives of the Puerto Rico agencies mentioned in 
Section I above), PRDE, and the Department, within five business days 
(according to PRDE's business calendar) of the end of the quarter, to 
discuss Puerto Rico's and PRDE's progress and the level of detail the 
Department wants Puerto Rico and PRDE to include in its written 
quarterly

[[Page 30692]]

report that will be submitted within fifteen business days (according 
to PRDE's business calendar) of the call or meeting. The Parties may 
modify this schedule by mutual agreement.
    Subject to the meeting or call above, in general, each quarterly 
report will include information such as: (1) A description of 
activities and progress for each task and its related sub-tasks during 
the reporting period, (2) the status of each critical action step 
required to be taken during the reporting period, (3) detailed 
documentation of critical action step completion for those steps 
required to be completed during the reporting period (including 
explanations of delays for all steps not completed that were scheduled 
to be completed during the period, and expected completion dates for 
all unimplemented steps), (4) documentation of measures of performance 
and results, and (5) other data or documentation as specified within 
the action steps for each task or related sub-task in this Agreement, 
and/or discussed in the pre-report meeting among the Department, Puerto 
Rico, and PRDE.
    Per discussions with the Department, Puerto Rico and PRDE will 
transmit reporting information to the Department via e-mail and/or an 
Internet web site. If transmittal of the reporting information is not 
possible via a website, Puerto Rico and PRDE will continue to be 
responsible for tracking, monitoring, and reporting progress on all 
requirements and milestones in this Agreement, in English and in a 
manner that is fully accessible to the Department and the public. 
Reporting information will be updated continuously, but in any event, 
on a quarterly basis, no later than within fifteen business days 
(according to PRDE's business calendar) from the day of the call or 
meeting among the Department, Puerto Rico, and PRDE, specifying the 
specific reporting required for that quarterly period. These reports 
also will fulfill the reporting requirements required under PRDE's 
special conditions that are currently in effect, or as modified.
    The first quarterly period will encompass the time from which the 
Parties sign this Agreement through March 31, 2008. Within the first 
forty-five days of the signing of this Agreement, the Department will 
work with PRDE to agree on a more rigorous reporting schedule for 
reporting progress during the first six months following the signing of 
this Agreement (the early implementation phase of this Agreement).

V. Independent Internal Audit Office and Audit Committee

    PRDE commits to full implementation of its Internal Audit Office 
(IAO) and its Audit Oversight Committee (the Committee) in accordance 
with the terms of the IAO and Committee charters. Both signed charters 
are attached to this Agreement and are hereby incorporated by reference 
as Attachment B. Therefore, under the terms of this Agreement, PRDE 
commits to an IAO that is fully independent, staffed, and trained.

VI. Corrective Action Plans, Action Steps, and Timelines

Corrective Action Plans

    With the exception of the Title I, Standards and Assessments 
Corrective Action Plan, which is attached and incorporated into this 
Agreement at the signing as Attachment A, Corrective Action Plans, that 
address each area of noncompliance are to be completed and incorporated 
into this Agreement by March 15, 2008. The Corrective Action Plans will 
either address specifically the action steps and timelines that are 
included in the task descriptions in this Agreement, or the Corrective 
Action Plans will delineate one or more alternative approaches that 
will be used to bring PRDE and Puerto Rico into compliance with 
Department requirements. Alternative approaches may include: (1) 
Consolidating administrative funds under Sec. Sec.  9201 and 9203 of 
the ESEA; (2) Utilizing Federal funds to establish and operate a 
Statewide system of intensive and sustained support and improvement 
(Statewide system of support, Sec.  1117 of the ESEA) for schools 
funded under Title I, ESEA including schoolwide programs under Sec.  
1114 of Title I, (3) Transferring funds, under Sec. Sec.  6121-6123 of 
the ESEA, (4) Contracting for technical assistance services from a 
qualified and experienced third-party providers and receiving services 
from the Florida and the Islands Regional Comprehensive Center (FLICC); 
and/or (5) Contracting for specific services under one or more of the 
covered Federal programs.

Schoolwide Programs

    Under Sec.  1114 of Title I of the ESEA, the Department authorizes 
schools with concentrations of poverty of at least 40 percent, to use 
Title I funds, along with other Federal, State, and local funds, to 
operate a schoolwide program that upgrades the entire education program 
in the school to improve the academic performance of all students, but 
especially the lowest achieving students. To operate a schoolwide 
program, a school must conduct a comprehensive needs assessment of the 
entire school and, using data from the needs assessment, develop a 
comprehensive plan that meets the requirements of Sec.  1114(b) of the 
Title I of the ESEA and Sec.  200.27 of the Title I regulations. In 
operating a schoolwide program, a school may consolidate funds from 
Federal, State, and local sources into one ``pool'' of funds and is not 
required to account for those funds separately, provided that the 
school meets the intent and purposes of the programs included in the 
consolidation. This differs from a Title I ``targeted assistance'' 
program, where Title I funds may be used only for supplementary support 
services for specific students identified as being most at risk of not 
meeting State standards.
    Under Sec.  1114, Federal, State, and local funds, may be combined 
so that PRDE would operate Federal education programs with greater 
flexibility, improve its entire educational program, and improve the 
academic achievement of all Puerto Rico students. A Schoolwide program 
differs from a Title I, Part A ``targeted assistance'' program, where 
Title I funds may be used only for supplementary support services for 
targeted students identified as being most at risk of not meeting State 
standards.
    As part of the Corrective Action Plan, PRDE agrees to report to the 
Department with regard to which funds have been consolidated into 
PRDE's schoolwide programs, including funds awarded under Title I of 
ESEA, and how PRDE is undertaking a comprehensive reform strategy to 
improve the academic achievement of all students in each eligible 
Puerto Rico school, particularly the lowest achieving students. In 
addition, PRDE and the Department may determine that they should 
consider additional ways for improving the operation of schoolwide 
programs, including alternative arrangements for the management and 
operations of schoolwide programs in Puerto Rico, such as management at 
the regional level and operation at the school level.

Continuous and Meaningful Reassessment of Compliance Status

    The Department, with PRDE and Puerto Rico, will continuously 
reassess the action steps and timelines in this Agreement and in the 
various Corrective Action Plans to determine whether: (1) The action 
steps fully meet the requirements of this Agreement, (2) the action 
steps will move Puerto Rico and PRDE toward achieving required 
measurable objectives, and ultimately,

[[Page 30693]]

full programmatic compliance within three years, and (3) the timelines' 
need to be modified within the time boundaries set forth in this 
Agreement.

Additional Areas To Be Covered by Corrective Action Plans

    The Corrective Action Plans for which Puerto Rico and PRDE will be 
accountable are critical to PRDE and Puerto Rico's compliance with each 
task and sub-task in this Agreement. Once Puerto Rico and PRDE develop 
Corrective Action Plans that address each task or sub-task in this 
Agreement, or that are based on an alternative approach for addressing 
compliance, and the Department agrees to the revised Corrective Action 
Plans, the action steps and timelines in the Corrective Action Plans 
will become additional requirements of this Agreement and will be 
subject to the reporting requirements and consequences for not meeting 
terms and conditions as set forth in this Agreement. The Department 
will assist by consulting with Puerto Rico and PRDE to develop reports 
or reporting formats that satisfy the reporting requirements set forth 
in this Agreement. The Department will also assist Puerto Rico and 
PRDE, to the extent that resources are available, with training 
personnel and technical assistance.

VII. General Measurable Objectives

    Puerto Rico, PRDE, and the Department agree that the following 
measurable objectives apply for each task and sub-task contained in 
this Agreement and that will be in the Corrective Action Plans that are 
to be incorporated into this Agreement by March 15, 2008:
    1. PRDE plans, other documents, and reports are timely, provided to 
the Department in English, complete, accurate, and address the 
requirements set forth in this Agreement.
    2. PRDE implements action steps within the timeframes set forth in 
this Agreement and in the Corrective Action Plans to be developed.
    3. PRDE's implementation of sub-tasks and action steps demonstrates 
progress towards achieving the outcomes or measurable objectives set 
forth in this Agreement or in the Corrective Action Plans to be 
developed.
    The remainder of this Agreement provides task descriptions, goals, 
and action steps for the program areas in the covered Federal programs 
addressed in this Agreement. By signing this Agreement, Puerto Rico and 
PRDE commit to taking the necessary actions to be in full compliance, 
by the end of the three-year period covered by this Agreement, with the 
program requirements applicable to all Department grants for which 
Puerto Rico and PRDE expend funds and any other requirements set forth 
in this Agreement, unless the Department determines that an alternative 
approach to program compliance as delineated in one or more Corrective 
Action Plans is the approach by which PRDE can best serve the 
educational needs of its students, as provided for in Section VI of 
this Agreement. Puerto Rico and PRDE commit to full implementation of 
this Agreement, and in greater detail, of the action steps in the PRDE 
Corrective Action Plans that will be incorporated by reference into 
this Agreement.

VIII. Tasks

    Because the stated purpose of this Agreement is to improve 
education for the students of Puerto Rico, it is critical to the 
success of this Agreement that Puerto Rico and PRDE develop and refine 
long-term goals, assess the current status of each program receiving 
Federal assistance, and design coherent plans to bridge the gap between 
the current status of education in Puerto Rico and its goals of 
improving education and fully complying with all Federal program 
requirements.
    This ``Tasks'' section represents what the Parties have generally 
agreed to at the time of execution of this Agreement. With the 
exception of the Standards and Assessments Corrective Action Plan, some 
of the subtasks and steps set forth below may be modified by mutual 
consent of the Department, Puerto Rico, and PRDE, in the Corrective 
Action Plans that will be developed by March 15, 2008. If modifications 
are made to the subtasks and steps set forth below through the 
Corrective Action Plans, they will be incorporated by reference into 
this Agreement.

Title I, ESEA

Task 1.0: Title I--Standards and Assessments (Attachment A)

Overall Task Description
    Title I of the ESEA, as amended by the No Child Left Behind Act of 
2001 (NCLB), requires Puerto Rico and PRDE to develop content and 
performance standards and to develop and implement an appropriate 
assessment system. Puerto Rico and PRDE have failed to meet certain of 
the statutory and regulatory requirements in these areas.
    Specific action steps that PRDE must meet to come into compliance 
with the standards and assessment requirements of Title I have been 
articulated and are hereby attached and incorporated by reference into 
this Agreement. As with all other programmatic issues included in and 
addressed by this Agreement, Puerto Rico and PRDE must timely submit 
documentation concerning their compliance with the action steps 
regarding standards and assessments in accordance with Section IV of 
this Agreement.
    Responsible Offices/Persons: Carmen Ayuso, Janet De Jesus, Angel 
Canales.

Task 2.0: Title I--Improvement of Programmatic Performance

    Goal: Develop and implement procedures that ensure proper 
computation and allocation of programmatic fiscal requirements.
    Completion Date: July 31, 2009.
    Responsible Offices/Persons: Janet De Jesus, Carmen M. Rivera, Edna 
Ramos.
    Sub-Task 2.1: Title I Programmatic Fiscal Procedures--Formalize 
comparability procedures so they are standardized and consistent with 
Title I fiscal guidance provided by the Department.
    Completion Date: July 31, 2008.
    Sub-Task 2.2: Develop and implement procedures that ensure the 
proper allocation of reserved school improvement funds to schools in 
improvement, corrective action, or restructuring, through the following 
steps:
     Develop formal policies and procedures.
     Disseminate policies and procedures.
     Train relevant staff on policies and procedures.
     Monitor implementation of policies and procedures.
    Completion Date: July 31, 2009.

Task 3.0: Adequate Yearly Progress (AYP)

    Goal: To develop and implement an approved plan for the timely 
calculation of AYP, consistent with all statutory and regulatory 
requirements.
    Completion Date: August 1, 2008.
    Responsible Offices/Persons: Carmen Ayuso, Janet De Jesus, Angel 
Canales.
    Sub-Task 3.1: Establish the manner in which AYP will be calculated 
in a timely manner consistent with all statutory and regulatory 
requirements.
    Completion Date: August 1, 2008.
    Sub-Task 3.2: Train relevant PRDE staff in, and confirm their 
understanding of, the AYP requirements and the use of AYP to make 
school improvement decisions.
    Completion Date: August 1, 2008.

[[Page 30694]]

Task 4.0: Accountability Requirements

    Goal: To develop and implement a methodology by which PRDE will 
comply with all ESEA Title I accountability requirements.
    Completion Date: December 31, 2008 (unless otherwise agreed to in 
the Corrective Action Plan).
    Responsible Offices/Persons: Carmen Ayuso, Angel Canales, Janet De 
Jesus.
    Sub-Task 4.1: Make final determination as to what methodology PRDE 
will use to include small schools in the accountability system.
    Completion Date: June 30, 2010 (unless otherwise specified in the 
Corrective Action Plan).
    Responsible Offices/Persons: Carmen Ayuso, Angel Canales, Janet De 
Jesus.
    Sub-Task 4.2: Establish the manner in which the graduation rate 
will be calculated in accordance with statutory and regulatory 
requirements.
    Completion Date: December 31, 2008 (unless otherwise agreed to in 
the Corrective Action Plan).
    Responsible Offices/Persons: Carmen Ayuso, Angel Canales, Janet De 
Jesus
    Sub-Task 4.3: Develop and implement procedures that ensure PRDE's 
adherence to and compliance with all State and local report card 
requirements by:
     Including PPEA results and information on accommodations 
on separate forms.
     Including all ``Subgroup'' assessment information.
     Migrating all Highly Qualified Teacher (HQT) classroom 
level data from the data warehouse into the school report card.
     Developing State and local report card templates.
    Completion Date: December 22, 2008.
    Responsible Offices/Persons: Carmen Ayuso, Angel Canales, Janet De 
Jesus.
    Sub-Task 4.4: Establish specific procedures that will ensure that 
PRDE adheres to and complies with all Federal School Improvement and 
School Level Planning requirements and ensure the implementation of the 
required activities for schools in improvement, corrective action, 
restructuring, and alternative governance.
    Completion Date: June 30, 2008.
    Responsible Offices/Persons: Norma Mendez, Lisandra Fradera, 
Zoraida Mercado, Rafael Cruz, Angel Canales.
    Sub-Task 4.5: Assessments should be used for purposes for which 
such assessments are valid and reliable, and be consistent with 
relevant, nationally recognized professional and technical standards. 
AYP shall be defined by the State in a manner that is statistically 
valid and reliable. PRDE shall:
     Develop assessment quality control procedures to ensure 
that its assessment contractors are scoring assessments accurately 
using professionally recognized procedures and processes.
     Develop written procedures to address any failure of 
contractors to deliver assessment materials and results in a timely 
manner.
     Develop internal procedures for monitoring the accuracy of 
assessment data that it provides to the public and guidelines to ensure 
that all students are being assessed appropriately on an annual basis.
     Modify its appeals process for assessment and 
accountability to ensure that corrections are made well in advance of 
the beginning of the next school year by which the accurate data must 
be reported.
    Completion Date: May 2009 (unless otherwise specified in the 
Corrective Action Plan).
    Responsible Offices/Persons: Carmen Ayuso, Carmen Ramos, Angel 
Canales.
    Sub-Task 4.6: Implement all required components as identified in 
Puerto Rico's accountability workbook. PRDE shall:
     Develop a process with clear and objective guidelines to 
ensure that all schools, especially schools with enrollments that fall 
below the minimum sample size, are included in AYP decisions.
     Train appropriate staff on the business rules and policies 
used by PRDE in making AYP decisions.
     Review procedures for coding student test booklets so that 
the responsibility for coding information, such as whether the student 
has been enrolled for a full academic year, is not placed primarily in 
the hands of students, especially at the elementary level.
     Develop a timetable for reporting AYP determinations so 
that parents are aware of their children's school's status prior to the 
beginning of each school year.
    Completion Date: June 2010 (unless otherwise specified in the 
Corrective Action Plan).
    Responsible Offices/Persons: Carmen Ayuso, Carmen Ramos, Angel 
Canales, Janet De Jesus.
    Sub-Task 4.7: Publish an annual report card and an Annual Report to 
the Secretary. PRDE shall:
     Develop and publish its SEA/LEA and school report cards 
including all of the required NCLB reporting elements, as specified in 
section 1111(h) of ESEA.
     Provide to the Department templates, an updated timeline, 
and operational details for the report cards at each level.
    Completion Date: December 2008.
    Responsible Offices/Persons: Carmen Ayuso, Carmen Ramos, Angel 
Canales.
    Sub-Task 4.8: PRDE indicates how funds received under Grants for 
State Assessments and Related Activities (section 6111) will be or have 
been used to meet the 2005-06 and 2007-08 assessment requirements under 
NCLB.
     PRDE must provide the Department with a full accounting of 
how it has expended section 6111 State assessment funds for the last 
three Federal fiscal years.
    Completion Date: December 2008.
    Responsible Offices/Persons: Rafael Cruz, Carmen Ramos.

Task 5.0: Activities for Schools in Corrective Action, Improvement, 
Restructuring, and Alternative Governance

    Goal: To develop and implement an approved methodology for PRDE to 
come into full compliance with all program requirements.
    Completion Date: June 30, 2008.
    Responsible Offices/Persons: Norma Melendez, Lisandra Fradera, 
Zoraida Mercado, Rafael Cruz, Angel Canales.
    Sub-Task 5.1: Implement actions for schools in corrective action or 
restructuring at the end of the current school year based on the 
recommendations of District level staff (on a yearly basis before the 
beginning of the school year).
    Sub-Task 5.2: Develop and train school directors on necessary 
corrective actions for schools in corrective action or restructuring 
(on a yearly basis before the beginning of the school year).

Task 6.0: Public School Choice and Supplemental Educational Services

    Goal: To develop and implement procedures that ensure PRDE's 
adherence to all Federal requirements on Public School Choice.
    Completion date: June 30, 2008.
    Responsible Offices/Persons: Norma Melendez, Lisandra Fradera, 
Zoraida Mercado, Rafael Cruz, Angel Canales.
    PRDE will develop and implement procedures that ensure adherence to 
Federal requirements on Public School Choice through the following 
steps:
     Develop a fully functional Public School Choice Support 
and Administrative Structure.
     Implement Public School Choice for all schools in school 
improvement.
     Implement the administrative procedures to implement 
Public School Choice.
     Train school directors on Public School Choice 
requirements.

[[Page 30695]]

Task 7.0: Parental Involvement and Notification

    Goal: To develop and implement procedures that ensure the proper 
implementation of parental involvement and notification requirements 
under Title I.
    Completion Date: June 30, 2008.
    Responsible Offices/Persons: Norma Melendez, Lisandra Fradera, 
Rafael Cruz.
    PRDE will ensure compliance with requirements on parental 
involvement and notification, through the following steps:
     Train new school directors on new parental involvement 
policies.
     Verify that parental involvement meetings are held.
     Monitor PRDE to ensure that programs meet all parental 
involvement requirements.
     Send all required parental notifications to parents on a 
timely basis and in a manner consistent with statutory and regulatory 
requirements.

Task 8.0: Paraprofessional Qualifications

    Goal: To develop and implement procedures that ensure the proper 
implementation by PRDE of all Federal paraprofessional qualification 
requirements.
    Completion Date: June 30, 2008.
    Responsible Offices/Persons: Rafael Sifonte, Myrna Crespo, Norma 
Melendez.

Task 9.0: Even Start Family Literacy Program

    Goal: To develop and implement procedures that ensure that PRDE 
carries out required programs and activities under its Even Start 
Family Literacy Program grants, complies with fiscal requirements at 
the State and the local subgrant levels, and takes steps to prevent 
large amounts of Even Start grant funds from remaining unspent.
    Completion Date: December 31, 2008. (See interim completion dates 
following each of the steps below).
    Responsible Parties: Maria del Carmen Martinez, Myrna Rodriguez.
     PRDE will address the deficiencies in its Even Start 
program administration through the following steps:
     PRDE must provide a plan showing that an annual 
independent evaluation will be conducted of each local Even Start 
program, and include an analysis of data and recommendations for 
program improvement. [Interim completion date: June 2008.]
     PRDE must develop, submit to the Department, and implement 
a plan for Even Start projects to implement high-quality, intensive 
instructional programs, including evidence that it has provided 
training for Even Start staff to use high-quality instructional 
literacy materials for children and adults. [Interim completion date: 
December 2008.]
     PRDE must provide evidence that it has complied with the 
requirement in section 1233(a) of the ESEA for the 2006-2007 school 
year, which requires that it has not spent for administration more than 
50% of the Even Start funds it has reserved for State level activities. 
[Interim completion date: March 2008.]
     PRDE must provide evidence that all local Even Start 
projects are meeting the required matching requirement, and that 
indirect costs (unallowable) are not included as a matching 
contribution. [Interim completion date: March 2008.]
     PRDE must provide documentation demonstrating that it has 
notified local Even Start programs about maintenance of effort 
requirements in section 9521 of the ESEA, and that it includes Even 
Start projects in its implementation of the maintenance of effort 
requirements. [Interim completion date: March 2008.]
     PRDE must provide a plan for how it will spend its Even 
Start grant funds so that large amounts of past years' funds do not 
remain unspent. [Interim completion date: March 2008.]

Titles I & II, ESEA

Task 10.0: Highly Qualified Teachers (HQT)

    Goal: To develop and implement an approved plan for highly 
qualified teachers based on accurate and reliable school level data.
    Completion Date (unless otherwise specified below): June 30, 2008.
    Responsible Offices/Persons: Romanito Rod[racute]iguez, Richard 
Martinez, Clarimar Cruz.
    PRDE agrees to fully comply with all HQT requirements, through the 
following steps:
     Submit an approvable revised State HQT plan that meets all 
requirements in the ``Reviewing Revised State Plans'' rubric, which the 
Department provided to States to help them develop their plans and 
which the Department uses to evaluate State plans. The plan will be 
based on an analysis of complete, accurate classroom-level HQT data.
     Develop and submit procedures by which PRDE will meet the 
HQT requirements, and the requirements for public reporting, as 
required by the ESEA (Sec. Sec.  1111(h)(1)(C)(viii) and (h)(2)(B), and 
Sec.  1111(h)(6)(B)(ii)) of the ESEA, on all teachers who are not 
highly qualified and all classes not taught by highly qualified 
teachers.
     Include in the PRDE monitoring instruments, criteria for 
determining whether administrative districts and schools meet all of 
the requirements governing HQT, including paraprofessionals (Sec.  
1119(c)-(g) of the ESEA).
     Gather complete and accurate classroom level preliminary 
HQT data for the 2007-2008 school year by March 2008.
     By the date the Department establishes in December 2008, 
submit complete and accurate HQT data for the 2007-2008 year to the 
Department in Part 1 of PRDE's School Year 2007-2008 Consolidated State 
Performance Report (CSPR).
     On an annual basis, analyze classroom level HQT data to 
determine hiring and professional development needs.
     Implement an annual LEA-level needs assessment for 
professional development and hiring, as required in Sec.  2122(c) of 
the ESEA. The needs assessment will be completed annually as part of 
the process of planning the use of Title II, Part A funds, and before 
any Title II, Part A funds are obligated or expended.
     Develop an annual spending plan for the LEA Title II, Part 
A funds, to indicate how proposed spending addresses needs identified 
in the required needs assessment, as well as allowable uses of LEA 
funds described in Sec.  2123 of the ESEA.
     Develop an annual spending plan for SEA Title II, Part A 
funds that indicates how the proposed spending will be for allowable 
uses of SEA funds described in Sec.  2113 of the ESEA.
     As required in Sec.  9501 of the ESEA, consult, on an 
annual basis, with all eligible private schools that wish to 
participate in the Title II, Part A program and ensure that equitable 
services to private school staff are provided with Title II, Part A 
funds to address their professional development needs as identified by 
the private schools. Consultation should occur before the start of each 
school year and must be part of the process of planning the use of 
Title II, Part A funds, and before any Title II, Part A funds are 
obligated or expended.

Title IV, ESEA

Task 11.0: Safe and Drug Free Schools Discretionary and State Grants

    Goal: To develop and implement procedures for a Safe and Drug-Free 
Schools (SDFS) strategy that PRDE will administer effectively and that 
takes into account need and quality programming supported by

[[Page 30696]]

strengthened controls to ensure that Federal funds are spent in a 
timely manner and in full compliance with all applicable Federal 
requirements.
    Completion Date: June 1, 2008.
    Responsible Offices/Persons: Shirley Nunez, Anna Crespo, Regina 
Cibes.
    PRDE will implement the following steps that are designed to 
improve overall administration of the SDFS programs, including 
implementation of programs based on scientific research, and 
appropriate monitoring and internal controls to ensure that funds are 
used responsibly and in a manner consistent with all applicable 
statutory requirements and, among other things, ensure that large 
amounts of SDFS funds do not remain unspent:
     Fully implement the Principles of Effectiveness provided 
under Sec.  4115(a) of the ESEA.
     Target SDFS resources, based on a needs analysis, to 
activities specific to funding priorities and grant requirements.
     Develop and implement the Uniform Management Information 
and Reporting System (UMIRS) consistent with all statutory requirements 
based on framework developed by PRDE.
     Improve oversight and monitoring strategies for program 
requirements, as well as financial management and internal controls.

Task 12.0: Twenty-First Century Schools--After School Learning Centers 
(21st CCLC)

    Goal: To develop plans and procedures for spending, monitoring, and 
providing technical assistance.
    Completion Date: August 29, 2008 (unless an interim date is 
specified below).
    Responsible Offices/Persons: PRDE will develop and implement plans, 
procedures, and processes to ensure adherence to Federal requirements 
for the 21st CCLC program through the following steps:
     Develop, implement, and submit an annual spending plan 
that includes procedures on how funds will be drawn down and how State 
set-aside funds will be used to support the program. Interim date: 
February 15, 2008.
     Develop, implement, and submit an annual grant competition 
plan and schedule that outlines the activities that will be 
accomplished to ensure timely selection of providers.
     Design and implement a plan that describes the procedures 
and processes that will be used to evaluate and assess the quality of 
projects developed by providers.
     Create and implement a monitoring and technical assistance 
plan that includes strategies for improving oversight of, and 
monitoring for, program requirements, providing technical assistance to 
providers, and monitoring and administering financial management and 
internal controls.

Federal Student Assistance

Task 13.0: Title IV of the Higher Education Act (HEA)

    Goal: To develop and implement procedures to ensure compliance with 
Federal Student Assistance regulations requiring accounting on an 
accrual, rather than cash, basis.
    Completion Date: March 31, 2009 (unless otherwise specified in the 
Corrective Action Plan).
    Responsible Office/Person: Felipe Rosa.
    PRDE will ensure compliance with Department regulations at 34 CFR 
668.23(d), implementing Title IV of the HEA, that require all schools 
receiving funds under the HEA to submit financial statements prepared 
on an accrual basis, in accordance with U.S. Generally Accepted 
Accounting Principles (GAAP).

Byrd Scholarship Program

Task 14.0: Establish Effective Communication System To Administer Grant 
Funds

    Goal: To develop and implement an effective, ongoing system by 
which PRDE can communicate with Department staff in a timely manner to 
facilitate proper administration of Byrd Scholarship funds.
    Completion Date: March 31, 2008.
    Responsible Offices/Persons: Anna Crespo, Elaine Rosario.
    PRDE will address the deficiencies in its administration of Byrd 
Scholarship Program funds through the following steps:
     Immediately establish an English speaking contact who 
would have the authority over the program to respond to Department 
officials directly, and in a timely manner, to discuss the 
administration of the Byrd Scholarship Program, and to whom Department 
officials can send information about the program.
     Within thirty days, provide to the Department the Annual 
Performance Report (APR) on the newly approved form by the Office of 
Management and Budget, OMB Form 1840-0598, for the reporting 
period 2006 through 2007.
     Ensure that information about the Byrd Scholarship Program 
is distributed to eligible recipients in a timely manner by 
resubmitting the Participation Agreement for review and approval by the 
Byrd Program manager.

Individuals With Disabilities Education Act (IDEA)

Task 15.0: Submit All Required Program Data

    Goal: Provide all data required by the Office of Special Education 
Programs' June 15, 2007 State Performance Plan/Annual Performance 
Report (SPP/APR) response letter, and that will be required 
subsequently to be issued in June 2008, June 2009, and June 2010.
    Interim Completion Dates: February 1, 2008; February 1, 2009.
    Completion Date: February 1, 2010.
    Responsible Offices/Persons: Miriam Merced, Ada Hernandez.
    PRDE will address the deficiencies in its administration of Parts B 
and C of the IDEA, and will submit data and otherwise demonstrate its 
compliance with requirements of the IDEA by demonstrating that:
     PRDE develops individualized education programs (IEPs) for 
all children transitioning from Part C to Part B of the IDEA, and 
provides special education and related services by each child's third 
birthday.
     PRDE completes all evaluations and reevaluations within 
required timelines and eliminates the backlogs of students with 
disabilities needing evaluations to determine eligibility for special 
education and related services.
     PRDE provides children served under the IDEA with needed 
assistive technology devices and services in a timely manner, and 
eliminates the backlog of students needing such devices and services.
     PRDE resolves complaints within the required 60-day 
timeline (34 CFR 300.152(a)), or within the timeframe of an extension 
obtained under 34 CFR 152(b).
     PRDE completes all due process hearings, as set forth 
under 34 CFR 300.515, within the required timelines.
     PRDE resolves financial management issues, including 
addressing and resolving the use-of-funds requirements related to 
transportation contracts.
     PRDE submits timely and accurate data required under 
sections 616 (SPP/APR) and 618 (State-reported data) of the IDEA.
     Increase staff in PRDE to provide proper oversight of the 
IDEA State plan and ensure compliance with IDEA requirements at the 
local school level, by working with the Department to specify the 
number of special education staff who will be hired in each year of the 
compliance agreement to increase the number of staff above the number 
of special education staff at the time of the signing of the Agreement.

[[Page 30697]]

Internal Audit

Task 16.0: Full Implementation of Internal Audit Office and Audit 
Committee

    Goal: To correct PRDE's current deficiencies in its internal audit 
practices.
    Completion Date: December 31, 2008.
    Responsible Offices/Persons: Lourdes Cruz, Myrna Crespo, IAO 
Director.
    Pursuant to discussions between the Department and PRDE, and in 
order for PRDE to address the Department's areas of concern regarding 
PRDE's Internal Audit Office (IAO) and the Audit Committee, PRDE will 
correct the current deficiencies in its internal audit practices 
through the following steps within one year of the date of this 
Agreement:
     Empowerment. Currently PRDE's IAO and the Audit Committee 
are not ``empowered'' to carry out their duties and responsibilities as 
provided for in their charter and in the PRDE legislation establishing 
the IAO and the Audit Committee. PRDE and Puerto Rico must take 
expeditious action to ensure that the Committee is fully empowered to 
carry out its duties by the full implementation of the charter and the 
enabling legislation.
     Organizational Misalignment. The IAO appears to report 
directly to the PRDE Secretary of Education rather than to the Audit 
Committee, based on the organizational chart for the IAO provided to 
the Department. This organization and reporting structure compromises 
the independence and objectivity of the IAO, which are key elements of 
the charter for the IAO. Moreover, the Government Auditing Standards 
(the so-called ``Yellow Book'') in section 3.21, state that a 
government audit organization's ability to perform its work and report 
the results impartially can be affected by its place within the 
government. Whether performing work to report externally to third 
parties or internally to top management, audit organizations must be 
free from organizational impairments to their independence. Section 
3.22 further states that government auditors can be presumed to be free 
from organizational impairments to independence when reporting 
externally to third parties.
     Absence of Sufficient Budgets. It appears that sufficient 
funding is not being provided for the IAO and the Audit Committee to 
function properly and to conduct investigations and studies as provided 
for in the respective charters and in the enabling legislation. PRDE 
and Puerto Rico must request and ensure that such necessary funding is 
provided so that the IAO and the Audit Committee are able to perform 
their duties.
     Autonomy. As a result of organizational misalignment and 
as confirmed by Audit Committee members, currently, neither the Audit 
Committee nor the IAO appears to have the level of autonomy from PRDE 
that is necessary to effectively carry out their duties and 
responsibilities, as specified in their charters and in PRDE's enabling 
legislation. Rather, the PRDE Secretary of Education has previously 
signed off on their reports, which is in clear violation of proper 
internal controls and internal audit principles and standards.
     Staffing. Neither the IAO nor the Audit Committee is 
adequately staffed in sufficient numbers, both at the professional and 
the support staff levels, to permit them to effectively conduct their 
duties and responsibilities, as specified in their charters and in the 
enabling legislation, through specific action steps.
    Under this Agreement and in accordance with the action steps to be 
included in the Corrective Action Plans to be incorporated into this 
Agreement, PRDE will take immediate steps, including the following, to 
address these concerns:
     Develop a work plan for the IAO that includes, at a 
minimum, review and assessment of all key items in this Agreement 
throughout the effective period of the Agreement. This work plan will 
be provided to the Audit Committee and the Department for review and 
comment and the approved version will be made available to the public 
through the IAO Internet site.
     Issue a Memorandum or Directive that states clearly that 
all PRDE staff must cooperate with the staff of the IAO and the Audit 
Committee and respond appropriately and expeditiously to any requests 
submitted to them by the IAO or the Audit Committee.
     Schedule a series of mandatory ``All Staff'' meetings for 
all PRDE managers and supervisors to communicate directly about the 
critical duties and responsibilities of the IAO and Audit Committee and 
to convey to all PRDE managers and supervisors that they must fully 
cooperate with the staff of IAO and the Audit Committee.
     Realign the organizational relationships so that the IAO 
reports directly to the Audit Committee and not to the PRDE Secretary 
of Education, in order to ensure the IAO has full autonomy and 
independence to perform its required duties.
     Provide all reports to the Department's local Office of 
Inspector General staff at the same time as the reports are provided to 
the Audit Committee, and, upon request by Department staff or oversight 
and monitoring staff of the Office of Inspector General, provide 
translations from Spanish to English of such IAO reports, to which PRDE 
has attested.
     Make semiannual reports of all IAO activities available to 
the public through the Internet site.
     Prepare results and status of corrective actions and 
provide these to the Audit Committee, the Department, and the public, 
in part so that the Department's Office of Inspector General can 
provide appropriate feedback and recommendations on submitted reports 
to assist the IAO and the Audit Committee to come into compliance with 
all applicable audit requirements and with proper accounting 
principles.
     Notify the Department in a timely manner of any actions 
taken or considered that may have the effect of diminishing the 
effectiveness of PRDE's IAO or Audit Committee, including the ability 
of the IAO or Audit Committee to carry out duties and responsibilities 
provided for in their respective charters.
    The Department also recommends that PRDE and Puerto Rico consider 
the following additional steps to help PRDE and Puerto Rico ensure that 
there is a fully functioning IAO and Audit Committee, although the 
Department recognizes that these steps may require more time and 
effort, and may depend in part on the actions of others (such as the 
Governor, legislature, and Unions) to execute fully:
     Increase the salaries for IAO members in order to be more 
competitive in recruiting and retaining the best possible candidates 
for office positions.
     Consider elevating the position of the IAO Director to a 
position equal to that of other senior PRDE management, both with 
regard to organizational placement and salary.
     Include in the annual PRDE budget appropriate funding for 
the projected work plan, materials, and staffing requirements for both 
the IAO and Audit Committee.
    The Parties to this Agreement, the U.S. Department of Education, 
the Puerto Rico Department of Education, and the Commonwealth of Puerto 
Rico, agree to faithfully carry out the terms of this Agreement, as set 
forth above.
Effective Date and Modification of Agreement:
    This Compliance Agreement will take effect upon execution by all 
the Parties and may be modified or amended only

[[Page 30698]]

by mutual written agreement of all the Parties hereto.
    For the Commonwealth of Puerto Rico:--------/s/--------

Honorable Anibal Acevedo-Vila,
Governor,

12-17-2007
Date

    For the Puerto Rico Department of Education:--------/s/--------

Dr. Rafael Aragunde-Torres, Puerto Rico Secretary of Education.

12-17-2007
Date

    For the U.S. Department of Education:--------/s/--------

Raymond Simon, Deputy Secretary of Education.

12-17-2007
Date --------/s/--------

Sara Martinez Tucker, Under Secretary of Education.

12-17-2007
Date
Attachments A and B

Attachment A--Commonwealth of Puerto Rico Department of Education

Puerto Rico Department of Education Action Plan For Title I Assessment 
Compliance Agreement

December 2007
    P.O. Box 190759, San Juan, Puerto Rico 00919-0759 
 Tel.: (787) 759-2000 ext. 2749, 4749  Fax: 
(787) 753-1804.
    The Department of Education does not discriminate in its 
activities, educational services or employment opportunities on the 
basis of race, color, sex, age, birth, national origin, social 
condition, political ideas, religious beliefs or any handicap.

 
----------------------------------------------------------------------------------------------------------------
          Action steps              Completion date      Documentation    Responsible office   Estimated budget
----------------------------------------------------------------------------------------------------------------
                                       REQUIREMENT 1.0--Content Standards
----------------------------------------------------------------------------------------------------------------
Development of rigorous academic  October 31, 2007..  Agendas,            Office of the       Action steps that
 content standards In English,                         attendee's lists,   Assistant           require budgeting
 Spanish, Mathematics and                              Minutes, Training   Secretary for       have been
 Science for each of the grades                        Power Points,       Academic Services.  completed.
 3-8 and 11.                                           Content Standards.
Involve education stakeholders    November 10, 2007.  Panel members,
 in the development of the                             attendee's lists,
 academic content standards.                           meeting minutes.
Approve academic content          November 10, 2007.  Circular Letter...
 standards in English, Spanish,
 Mathematics and Science for
 each of the grades 3-8 and 11.
----------------------------------------------------------------------------------------------------------------
                                 REQUIREMENT 2.0--Academic Achievement Standards
----------------------------------------------------------------------------------------------------------------
Develop with the help of          February 2009.....  Minutes, Panel      Office of the       2007-2008
 external consultant the                               members             Assistant          $10,000.
 academic achievement standards                        attendee's lists,   Secretary for
 for English, Spanish,                                 PLDs for English,   Academic Services.
 Mathematics and Science for                           Spanish,
 each of the grades 3-8 and 11.                        Mathematics and
                                                       Science, cut
                                                       scores.
Develop with the help of          February 2009.....  Minutes, Panel      Office of the       2008-2009
 external consultant the                               members             Associate          $500,000
 alternate academic achievement                        attendee's lists,   Secretary for      2009-2010
 standards for students with the                       PLDs for            Special Education. $60,000.
 most significant cognitive                            alternate
 disabilities for English,                             achievement
 Spanish, Mathematics and                              standards for
 Science for each of the grades                        English, Spanish,
 3-8 and 11.                                           Mathematics and
                                                       Science, cut
                                                       scores.
Involve education stakeholders    July 2009.........  Panel members                           Contract External
 in the development of the                             attendee's lists,                       Consultants and
 academic achievement standards                        meeting minutes.                        Vendors.
 and alternate achievement
 standards.

[[Page 30699]]

 
Approval of academic achievement  July 2009.........  Memorandum stating
 standards and alternate                               the policy that
 academic achievement standards                        the State's
 for students with the most                            academic
 significant cognitive                                 achievement
 disabilities for English,                             standards apply
 Spanish, Mathematics and                              to all students.
 Science for each of the grades
 3-8 and 11.
Revisit with the help of          July 2010.........  Minutes, Panel
 external consultants the                              members
 academic achievement standards                        attendee's lists,
 and the alternate achievements                        and PLDs.
 standards for English, Spanish,
 Mathematics and Science for
 each of the grades 3-8 and 11.
----------------------------------------------------------------------------------------------------------------
                                       REQUIREMENT 4.0--Technical Quality
----------------------------------------------------------------------------------------------------------------
Convene a TAC composed of five    January 2008......  List of TAC         Office of the       2007-2010
 national experts to advise on    April 2008........   members,            Undersecretary     $350,000 per year
 the technical quality of the     July 2008.........   attendee's list,    for Academic       2007-2008
 assessments.                                          agenda, meeting     Affairs            $400,000.
                                                       minutes.            Assessment
                                                                           Division.
State assessment staff will       January 2008......  Meeting minutes,    Evaluation and      2008-2009
 develop a validity argument                           Memorandum of       Planning Unit.     $600,000
 stating the purposes of the                           state policy.                          2009-2010
 assessments and delineating the                                                              $600,000.
 types of uses and decisions
 most appropriate to each
 assessment.
PRDE will consider contracting    July 2008-2010....  TAC                 Contract External
 to conduct a variety of studies                       recommendations     Consultants and
 as deemed appropriate and                             and planning        Vendor.
 identified by the TAC such as:                        schedules.
 bias reviews, DIF analysis,
 confirmatory factor analysis,
 cognitive labs, Cronbach's
 alpha, SEM, reliability at cut
 points, generalizability to
 evaluate inter-rater agreement
 for scoring of CR items. Over
 the course of the year 2008 we
 will provide more details as to
 the studies that will be done
 as advised by the TAC.
Analysis of the efficacy and      April 2008........  Review committee's
 validity of accommodations for                        notes, findings
 the PPAA including descriptions                       and
 and guidelines for linguistic                         recommendations,
 accommodations.                                       Guidance
                                                       documents,
                                                       Memorandum,
                                                       Agenda, training
                                                       material and
                                                       attendee's list,
                                                       documentation of
                                                       on site visits
                                                       and follow ups to
                                                       training.
Analysis of the efficacy and      December 2007.....  Sampling plan and
 validity of accommodation use                         student
 and interpretation of data.                           selection, Final
                                                       Report and
                                                       recommendations.
Develop a technical manual that   July 2008.........  Recommendations
 will document the technical                           from TAC on the
 quality of the assessments.                           table of contents
                                                       required of the
                                                       2008 Technical
                                                       Manual, Technical
                                                       Manual 2008.
----------------------------------------------------------------------------------------------------------------

[[Page 30700]]

 
                                           REQUIREMENT 5.0--Alignment
----------------------------------------------------------------------------------------------------------------
Develop blueprints that reflect   October 2007......  PPAA Blueprints...  Office of the       2007-2008
 the standards in terms of                                                 Undersecretary     $14.8M (Item
 content and DOK.                                                          for Academic        development
                                                                           Affairs             contract--5.5M.
                                                                           Assessment
                                                                           Division.
Collect panelists ratings for     July 2008.........  Minutes of          Evaluation and      (PPEA contract--3M
 items in the item bank on                             Panelists reviews   Planning Unit.     PPAA contract--
 content match and DOK.                                and ratings.                            4.7M).
Analyze with an external          July 2009.........  Study findings....  Office of the
 consultant the alignment on a                                             Assistant
 set of scorable items.                                                    Secretary for
                                                                           Academic Services.
Convene a state assessment        August 10, 2007...  Committee member    Office of the       2008-2009
 advisory committee to oversee                         roster.             Associate          $11.6M
 the new PPAA test development                                             Secretary for      (PPEA contract 3M
 and provide recommendations,                                              Special Education. PPAA contract 8M).
 decision options, alternative
 choices, best practices and
 emerging technical knowledge
 and outlining appropriate
 technical documentation
 required for assessment and
 accountability practices.
Select contractor for the         September 28, 2007  Signed contract or                      2009-2010
 development of test items that                        other signed                           $16.5M
 will ensure appropriate                               procurement                            (PPEA contract 3M
 categorical concurrence,                              document.                              PPAA contract 8M
 balance of representation,                                                                   Fall Field Test
 range of representation and                                                                   5M).
 depth of knowledge of our
 revised standards.
Schedule quarterly state          September 28, 2007  Meeting minutes                         Contract External
 assessment advisory committee    December 17, 2007.   and                                     Consultants and
 meetings to address issues       March 31, 2008....   recommendations.                        Vendors.
 related to overall test          June 20, 2008.....
 development activities and
 fulfilling compliance agreement
 requirements.
Convene the state assessment      October 17, 2007..  Assessment
 advisory committee composed of                        committee member
 the Undersecretary, Auxiliary                         roster, Meeting
 Secretary for Academic                                minutes and
 Services, Program Directors and                       documentation of
 Assessment Staff to provide                           comments.
 recommendations to the
 Secretary for the approval of
 the standards, grade level
 expectations and test
 blueprints.
Convene a technical advisory      January, 2008.....  Roster and
 committee (TAC) to provide                            qualifications of
 recommendations in the PPAA and                       TAC Members,
 PPEA test development process.                        invitational
                                                       letters.
Approval of the standards, grade  October 31, 2007..  Evidence of
 level expectations and test                           approval by the
 blueprints.                                           Secretary of
                                                       Education.
----------------------------------------------------------------------------------------------------------------
Statewide notification of         November 10, 2007.  Memorandum........  Office of the
 revised academic content                                                  Undersecretary
 standards and grade level                                                 for Academic
 expectations.                                                             Affairs
                                                                           Assessment
                                                                           Division.
PRDE staff training on new        December 19, 2007.  Meeting             Evaluation and
 standards and grade level                             invitations,        Planning Unit.
 expectations.                                         Agendas, PPT
                                                       presentations,
                                                       training material
                                                       and attendee's
                                                       list.

[[Page 30701]]

 
Constitute school district        December 19, 2007.  Roster of school    Office of the
 training teams composed of                            district training   Assistant
 school district superintendent,                       teams.              Secretary for
 two auxiliary superintendents,                                            Academic Services.
 one elementary and one
 secondary level school
 director, Spanish, Math and
 English content area
 supervisors, special education
 supervisor, Science facilitator
 and a librarian.
Convene an item review committee  January 2008......  Meeting minutes,
 to review the existing PPAA                           attendee's list
 item bank to consider the                             and
 recoding of the current items                         recommendations.
 to align with the new standards
 and GLEs.
State assessment advisory         July 2008.........  TAC
 committee review of the TAC                           recommendations,
 suggestions to incorporate                            committee meeting
 recommendations to the work                           minutes.
 plan.
Convene a committee to study the  January 2008......  Study results and
 need to revise the standards                          recommendations.
 for the adequate yearly
 progress measures.
Occasional Focal Group meetings   February 2008.....  Meeting minutes,
 for ongoing review of alignment  June 2008.........   attendee's list
 issues to ensure content match   September 2008....   and
 and appropriate DOK levels and   December 2008.....   recommendations.
 collecting evidence on ongoing   May 2009..........
 review and item development      October 2009......
 process.
Conduct PPAA item writing         February-June 2008  Agenda, PPT
 workshops with consultants to                         presentation,
 develop passages, items and                           notes on work
 scoring rubrics that will                             accomplished,
 address the changes to the new                        evaluation sheets
 content standards and grade                           and attendee's
 level expectations.                                   list.
Teacher and school personnel      March 31, 2008....  Meeting
 training on new standards and                         invitations,
 grade level expectations.                             Agendas, PPT
                                                       presentations and
                                                       attendee's list.
PPEA standard validation process  February 2008.....  Agenda, PPT,
 to review cut scores that will   April 2008........   attendee's list,
 adjust to rubric changes in                           PLDs and cut
 2008 scoring and reporting                            scores and
 based on the progress dimension.                      standard setting
                                                       technical report.
----------------------------------------------------------------------------------------------------------------
Convene a panel to review and     April 30, 2008--    Panel roster,       Office of the
 revise the performance level      December 2008.      meeting minutes     Undersecretary
 descriptors based on the new     February 2009.....   and                 for Academic
 standards and GLEs with the                           recommendations.    Affairs
 help of external consultants.                                             Assessment
                                                                           Division.
Collect and use samples of
 portfolios for the new PLD
 creation.
Complete the PLDs after standard  July 2009.........  PLDS..............  Office of the
 setting.                                                                  Assistant
                                                                           Secretary for
                                                                           Academic Services.
Revisit PLDs with the help of     July 2010.........  Panels
 external consultants.                                 recommendations.

[[Page 30702]]

 
Content and Sensitivity meeting   June 2008.........  Agenda, PPT         Office of the
 with teachers and consultants                         presentation,       Associate
 to revise new passages and                            attendee's list     Secretary for
 items.                                                and                 Special Education.
                                                       recommendations.
Conduct Content Grade Alignment   February 2008.....  Agenda, PPT
 with teachers and external                            presentation,
 consultants for all subjects                          attendee's list
 and grades to develop grade                           and
 level instructional and                               recommendations.
 assessment activities for each
 of the grade level performance
 standards for students who
 participate in the PPEA
 including a resource guide for
 teachers.
Revise with the help of external  July 2008.........  PPEA teacher's
 consultants the PPEA to align                         guide.
 to the new academic content                          PPEA Technical
 standards.                                            Manual.
Technical assistance form NAAC    June 2008.........  NAAC TA notes.....
 on the pro's and con's of
 different PPEA testing
 strategies to be considered in
 the 2009 PPEA test design.
PPEA Stakeholder meetings         July 2008.........  Stakeholder
 composed of representatives                           roster,
 from special and regular                              attendee's list
 educators, content experts,                           and suggestions.
 administrators, university
 staff and parents to review the
 PPEA assessment requirements,
 NAAC recommendations, timelines
 and test materials development
 including the content grade
 alignment recommendations, the
 grade level performance
 standards and recommendations
 for changes and improvements.
Develop with our vendor a new     July 2008.........  Revised Teacher's
 teacher's guide and resource                          Guide and
 manual for 2009 PPEA                                  Resource Manual.
 administration reflecting the
 new grade level performance
 standards and the requirements
 of the PPEA.
Prepare teacher training          July 2008.........  Teacher Training
 material for the PPEA 2008-2009                       Materials.
 administration.
----------------------------------------------------------------------------------------------------------------
Review and approval of the new    July 2008.........  Meeting minutes,
 item bank.                                            attendee's list
                                                       and
                                                       recommendations.
Conduct PPEA teacher trainings    September 2008....  Agenda, TT
 that will include an overview                         Material,
 of the assessment process,                            attendee's lists.
 participation guidelines,
 requirements and new grade
 level performance standards.
PPEA testing on new standards     October 2008......  PPEA testing
 begins.                                               schedule.
PPAA Forms are built for the      August-September    Writing Test Forms
 Spring 2009 tests that will       2008.
 address the changes to the
 content standards and
 expectations.

[[Page 30703]]

 
PPAA Writing forms for Spanish    September 2008....  Forms approval....  Office of the
 and English test review and                                               Undersecretary
 approval.                                                                 for Academic
                                                                           Affairs
                                                                           Assessment
                                                                           Division.
PPEA Follow up Teacher Training   October 2008......  Agenda, TT          Evaluation and
 emphasizing the required new                          Material,           Planning Unit.
 grade level performance                               attendee's lists.
 standard to be assessed.
Final review and approval of all  October 2008......  Forms approval....  Office of the
 PPAA forms.                                                               Assistant
                                                                           Secretary for
                                                                           Academic Services.
PPAA Spring 2009 Census Test      December 2008-      Census Test.......
 Production.                       January 2009.
Disseminate schedule for the      January 2009......  Memorandum, Test    Office of the
 PPAA Spring 2009 test                                 Administration      Associate
 administration.                                       Schedule.           Secretary for
                                                                           Special Education.
PPAA Pretest Workshop...........  January 2009......  Agenda, PPT,
                                                       training material
                                                       attendee's list.
Administer the PPAA Writing       February 2009.....  Program for test
 Tests.                                                administration.
Conduct PPAA Writing              February 2009.....  Agenda, PPT
 Rangefinding.                                         presentation,
                                                       attendee's list
                                                       and scoring rules.
Score the PPAA Writing Tests....  March 2009........  Scorer
                                                       information,
                                                       Scoring results.
Closing of PPEA administration    March 2009........  Portfolios
 aligned to new standards and                          developed based
 GLEs.                                                 on new standards.
PPAA Census Test Administration   March/April 2009..  Program for test
 for all subjects.                                     administration.
PPAA Rangefinding for all other   March/April 2009..  Agenda, PPT
 subjects.                                             presentation,
                                                       attendee's list
                                                       and scoring rules.
----------------------------------------------------------------------------------------------------------------
PPEA Rangefinding for all         March 2009........  Agenda, PPT         Office of the
 subjects.                                             presentation,       Undersecretary
                                                       attendee's list     for Academic
                                                       and scoring rule.   Affairs
                                                                           Assessment
                                                                           Division.
PPEA scoring on new standards...  April 2009........  Scoring results
                                                       and reports.
PPAA Scoring of all other
 subjects.
PPAA Census test item statistics  May 2009..........  Statistical         Evaluation and
 review.                                               analysis and        Planning Unit.
                                                       reports.
PPAA Standard Setting for all     May 2009..........  Agenda, PPT,        Office of the
 grades and subjects.                                  attendee's list,    Assistant
                                                       standard setting    Secretary for
                                                       technical report.   Academic Services.
PPEA Standard Setting...........  May 2009..........  Agenda, PPT,        Office of the
                                                       attendee's list,    Associate
                                                       performance level   Secretary for
                                                       descriptors and     Special Education.
                                                       cut scores and
                                                       standard setting
                                                       technical report.
PPEA new score reporting and      June 2009.........  Reports...........
 PPAA Reporting of test results.
PPEA Stakeholder meeting to       July 2009.........  Stakeholder
 review the assessment                                 roster,
 activities for the 2008-2009                          attendee's list
 administration, timelines for                         and suggestions.
 the next assessment year,
 participation guidelines, grade
 level performance standards
 requirements and examples and
 make recommendations for
 changes and improvements.
PPAA Fall Field Test Production.  June-July 2009....  Test Forms........
Convene a work group to review    July 2009.........  Test form approval
 and approve PPAA fall field
 test forms.

[[Page 30704]]

 
Fall 2009 standalone PPAA Field   September 2009....  Field Test Program
 Test.
Scoring of PPAA Fall Field Test.  October 2009......  Scoring results
                                                       and reports.
PPAA Field test item and          October-Nov. 2009.  Statistical
 statistics review.                                    analysis and
                                                       reports.
2010 PPAA Test Development and    December 2009.....  Test review notes
 PRDE final review and approval.                       and final
                                                       approval.
2010 PPAA Test Production.......  December 2009--     2010 Tests
                                   January 2010.       Booklets.
2010 PPAA Pretest Workshop......  February 2010.....  Agenda, PPT,
                                                       attendee's list.
----------------------------------------------------------------------------------------------------------------
PPAA Rangefinding Meeting.......  March 2010........  Agenda, PPT         Office of the
                                                       presentation,       Undersecretary
                                                       attendee's list     for Academic
                                                       and scoring rules.  Affairs
                                                                           Assessment
                                                                           Division.
Test data and reporting reviews   April 2010........  Review notes and
 and data quality controls.                            findings
                                                       Processing,
                                                       Scoring and
                                                       Reporting Quality
                                                       Control Checklist.
Reporting of test results.......  June 2010.........  Agenda, PPT         Evaluation and
                                                       presentation,       Planning Unit.
                                                       attendee's list
                                                       and scoring rules.
Contract experience reviewers to  February-June 2010  Alignment Study...  Office of the
 conduct an evaluation of the                                              Assistant
 quality of alignment on the new                                           Secretary for
 tests via an external alignment                                           Academic Services.
 study.
Conduct a PLD validity study....  June 2010.........  Study findings....  Office of the
                                                                           Associate
                                                                           Secretary for
                                                                           Special Education.
----------------------------------------------------------------------------------------------------------------
                                           REQUIREMENT 6.0--Inclusion
----------------------------------------------------------------------------------------------------------------
Review assessment data to         July 2008.........  Reports that        Evaluation and      2007-2008
 document participation of all    July 2009.........   specify the         Planning Unit.     $335.000.
 students in the assessments.     July 2010.........   participation
                                                       rates and methods
                                                       of calculation.
Review state guidelines for       July 2008.........  Guidelines and      Office of the
 inclusion of all students.                            policy documents.   Assistant
                                                                           Secretary for
                                                                           Academic Services.
Qualitative review of the         December 2007.....  Review committee's  Office of the       2008-2009
 existing accommodations by type                       notes, findings     Associate          $150,000.
 to address their efficacy and                         and                 Secretary for
 use for LSP students.                                 recommendations.    Special Education.
Incorporate the expert panel and  January 2008......  Guidance documents  Title III Director  2009-2010
 external consultant                                                                          $100,000.
 recommendations in the
 development of guidance
 documents and LSP participation
 plans.
Revision of the accommodations    January 2008......  Revised
 manual to include                                     Accommodations
 accommodations for LSP students.                      Manual.
----------------------------------------------------------------------------------------------------------------
Incorporate the expert panel and  February 2008.....  Memorandum........  Evaluation and
 external consultant                                                       Planning Unit.
 recommendations in the state's                                           Office of the
 review of its policy on the use                                           Assistant
 of accommodations for Limited                                             Secretary for
 Spanish Proficient (LSP)                                                  Academic Services.
 students.                                                                Office of the
                                                                           Associate
                                                                           Secretary for
                                                                           Special Education.
                                                                          Title III Director
Training for educators on         July 2008.........  Agenda, training
 accommodations selection and                          material and
 use.                                                  attendee's list.

[[Page 30705]]

 
Evaluation of the effectiveness   April 2008........  Documentation of
 of training and the provision                         on site visits
 of technical assistance as                            and follow ups to
 needed to support appropriate                         training.
 accommodations selection and
 use.
Convene a panel of experts to     September 2007....  Roster of panel
 review the linguistic                                 members, meeting
 accommodations recommended and                        minutes, work
 best practices and                                    plan and
 accommodations for LSP students.                      recommendations.
Review the recent July 2007       September 2007....  Profile of LSP
 results to the LAS LINKS                              students.
 Espanol, Spanish language
 proficiency test, to gain a
 better understanding of our LSP
 student population and identify
 their linguistic background,
 their experiences in formal
 academic settings, and their
 distribution across grade
 levels.
Convene a panel of linguistic     October 2007......  Roster of panel
 experts to select the best                            members, meeting
 accommodations after obtaining                        minutes, work
 a comprehensive knowledge of                          plan and
 the LSP student population's                          recommendations.
 needs. Conditions that need to
 be explored to gain a better
 understanding of our LSP
 student population, considering
 the PRDE context, are the
 following:
    1. Student's academic
     Spanish language
     proficiency,
    2. First ``academic''
     language development,
    3. Prior formal schooling,
     and,
    4. The length of time the
     student has resided in
     Puerto Rico.
----------------------------------------------------------------------------------------------------------------
Develop guidelines with the help  February 2008.....  Developed           Evaluation and
 of external consultant to                             guidelines.         Planning Unit.
 identify appropriate                                                     Office of the
 accommodations based on the                                               Assistant
 student's performance and                                                 Secretary for
 linguistic listening, speaking,                                           Academic Services.
 reading and writing skills.                                              Office of the
                                                                           Associate
                                                                           Secretary for
                                                                           Special Education.
                                                                          Title III Director
Refine accommodation policy for   February 2008.....  Policy statements.
 LSP students to ensure maximum
 accessibility to the assessment.
Continue participating in the     Ongoing...........  Literature reviews
 LEP partnership and follow up                         of best practices.
 on upcoming recommendations and
 best practices for LSP Students.
Disseminate revised policy and    March 2008........  Memorandum........
 responsibilities regarding the
 LSP student participation and
 expanded linguistic
 accommodations use in large
 scale and instructional
 assessments.

[[Page 30706]]

 
Training on use of guidelines     March 2008........  Agenda, training
 for the selection of                                  material and
 accommodations, procedures for                        attendee's list.
 providing testing
 accommodations and
 documentation requirements.
Monitor accommodations selection  April 2008........  Monitoring
 and use in state assessments.                         findings.
Stakeholder meeting to obtain     June 2008.........  Meeting minutes,
 recommendations for additional                        recommendations
 accommodations if needed to be                        and attendee's
 used with the 2009 assessments.                       list.
----------------------------------------------------------------------------------------------------------------
                                       REQUIREMENT 7.0--Assessment Reports
----------------------------------------------------------------------------------------------------------------
Produce an interpretive guide     Yearly............  Interpretive Guide  Evaluation and      2007-2008
 that facilitates interpretation                                           Planning Unit.     PPAA scoring and
 of assessment data.                                                                           reporting $1.2M
                                                                                              PPEA scoring and
                                                                                               reporting $1.4M
                                                                                              2008-2009.
Produce individual student,       Yearly............  Reports...........  Office of the
 school, region and island wide                                            Undersecretary
 reports.                                                                  for Academic
                                                                           Affairs
                                                                           Assessment
                                                                           Division.
Conduct post-test workshops for   Yearly............  Training materials                      PPAA scoring and
 training on interpretation and                                                                reporting $2.4M
 use of assessment results.                                                                   PPEA scoring and
                                                                                               reporting $1.4M
                                                                                              2009-2010
                                                                                              PPAA scoring and
                                                                                               reporting $2.4M
                                                                                              PPEA scoring and
                                                                                               reporting $1.4M
                                                                                              (Costs are
                                                                                               included in the
                                                                                               test vendor's
                                                                                               contracts).
----------------------------------------------------------------------------------------------------------------

* Budget Summary

    The Puerto Rico Department of Education will be needing an 
estimated budget of approximately $45.8 M to cover the expenses for the 
tasks outlined in this three year action plan.

----------------------------------------------------------------------------------------------------------------
                       Critical element                           2007-2008        2008-2009        2009-2010
----------------------------------------------------------------------------------------------------------------
2.0..........................................................       $10,000.00      $500,000.00          $60,000
4.0..........................................................       400,000.00       600,000.00       600,000.00
5.0..........................................................           12.2 M            8.0 M           12.9 M
6.0..........................................................       335,000.00       150,000.00          100,000
7.0..........................................................            2.6 M            3.6 M            3.6 M
                                                              --------------------------------------------------
    Total....................................................           15.6 M           12.9 M          17.3 M
----------------------------------------------------------------------------------------------------------------
The funding sources will be approximately 35% federal dollars and 65% state dollars.
* Puerto Rico and the U.S. Department of Education reserves the right to review the estimated budget submitted
  according to the needs that may arise during the plan implementation process.

Attachment B--Puerto Rico Department of Education Audit Committee 
Charter

Organization

    This charter governs the operations of the Audit Committee (``the 
Committee'') of the Department of Education of Puerto Rico, (PRDE). The 
Committee shall review and reassess the charter at least every two 
years. The Committee shall consist of five members organized as 
described in the law. Members of the Committee shall be considered 
independent as long as they do not accept any consulting, advisory, or 
other compensatory fee from PRDE and are not affiliated persons of PRDE 
or its subsidiaries. All Committee members shall be financially 
literate, and at least one member shall have wide experiences in 
auditing matters.

Purpose

    The Audit Committee shall provide assistance to PRDE Management in 
fulfilling its oversight responsibility to the State and Federal 
Government and others relating to: the integrity of PRDE statements, 
the financial reporting process, the systems of internal accounting and 
financial controls, the performance of the PRDE internal audit function 
independent auditors, the

[[Page 30707]]

independent auditors' qualifications and independence, and PRDE's 
compliance with ethics policies and regulatory requirements. In so 
doing, it is the responsibility of the Committee to maintain free and 
open communication among the Committee, independent auditors, the 
internal auditors, and Management of the PRDE.
    In discharging its oversight role, the Committee is empowered to 
investigate any matter brought to its attention with full access to all 
books, records, facilities, and personnel of PRDE and the authority to 
engage independent counsel and other advisers as it determines 
necessary to carry out its duties.

Meetings

    The Committee will hold at least four meetings annually and will 
meet in separate executive sessions with PRDE management, independent 
auditors, and internal audit department representatives to review and 
resolve matters of concern presented to the Committee. The Committee 
may meet as many additional times as the Committee deems necessary or 
appropriate. Reports of all meetings shall be made to the Governor of 
Puerto Rico and the Secretary of Education.

Duties and Responsibilities

    The primary responsibility of the Audit Committee is to oversee 
PRDE's financial reporting process and to report the results of its 
activities to the Governor of Puerto Rico. While the Committee has the 
responsibilities and powers set forth in this Charter, it is not the 
duty of the Committee to plan or conduct audits or to determine that 
PRDE operations are accurate and in accordance with Laws and 
Regulations. Management is responsible for the preparation, 
presentation and integrity of PRDE financial statements; for the use of 
appropriate accounting principles and reporting policies by PRDE; and 
for the application of the Laws and Regulations that govern their 
operation. The Internal Audit Office as well as the independent 
auditors are responsible for auditing PRDE operations and reports 
regarding compliance with applicable laws and regulations.
    The Committee, in carrying out its responsibilities, believes its 
policies and procedures should remain flexible, so that it can better 
respond to changing conditions and circumstances. The Committee should 
take appropriate actions to set the overall tone for quality financial 
reporting, effective risk management practices, and ethical behavior. 
The following shall be the principal duties and responsibilities of the 
Committee. These are set forth as a guide with the understanding that 
the Committee may supplement them as appropriate.
     The Committee will ratify the appointment, termination and 
compensation of the Chief Auditing Executive, (CAE). The selection and 
recommendation of the CAE is the responsibility of PRDE management.
     The Committee will review and discuss with the CAE and 
appropriate staff members of the internal auditing office:
    [cir] The plans for, and scope of, their ongoing audit activities, 
and
    [cir] The annual report of the audit activities, examinations and 
results thereof of the internal auditing department.
     The Committee shall be directly responsible for the 
appointment and termination (subject, if applicable, to PRDE 
ratification), compensation, and oversight of the independent auditors, 
including resolution of disagreements between Management and the 
auditors regarding the operation reporting. The Committee shall 
evaluate the independent auditors' qualifications, performance, and 
independence (including that of the lead audit partner) and shall 
periodically consider the rotation of the lead audit partner and the 
independent audit firm. The Committee shall pre-approve all audit and 
other related services such as agreed-upon procedures used by the 
independent auditors and shall not engage the independent auditors to 
perform non-audit services prescribed by law or regulation.
     At least annually, the Committee shall obtain and review a 
report by the independent auditors describing:
    [cir] The independent auditors' internal quality control 
procedures;
    [cir] Any material issues raised by the most recent internal 
quality control review of the independent auditors, or by any inquiry 
or investigation by governmental or professional authorities within the 
preceding five years, regarding one or more independent audits carried 
out by the firm, and any steps taken to deal with any such issues; and
    [cir] All relationships between the independent auditor and PRDE 
(to assess the auditors' independence).
     The Committee shall discuss with the independent auditors 
the overall scope and plans for their respective audits, including the 
adequacy of staffing and compensation. Also, the Committee shall 
discuss with management, the internal auditors and financial controls 
including PRDE policies and procedures to assess, monitor and manage 
risk, and its legal and ethical compliance programs.
     The Committee shall periodically meet separately with 
Management, the internal auditors, and the independent auditors to 
discuss issues and concerns warranting the Committee's attention. The 
Committee shall provide sufficient opportunity for the internal 
auditors and the independent auditors to meet privately with members of 
the Committee. The Committee shall review with the independent auditors 
any audit problems or difficulties and Management's response.
     The Committee shall receive the reports from the 
independent auditor on the critical policies and practices of PRDE and 
all alternative treatments of financial information with accounting 
principles that have been discussed with Management.
     The Committee shall establish procedures for the receipt, 
retention, and treatment of complaints received by PRDE regarding 
accounting, internal accounting controls or auditing matters and the 
confidential anonymous submission by employees of PRDE of concerns 
regarding questionable accounting or auditing matters.

Internal Control Matters

     The Committee shall discuss with Management policies with 
respect to risk assessment and risk management. Although it is 
Management's duty to assess and manage the PRDE's exposure to risk, the 
Committee needs to discuss guidelines and policies to govern the 
process by which risk assessment and management is handled and review 
the steps Management has taken to monitor and control PRDE risk 
exposure.
     The Committee shall establish regular and separate systems 
of reporting to the Committee by Management and by the independent 
auditor, regarding any significant judgments made in Management's 
preparation of the financial statements and the view of each as to the 
appropriateness of such judgments.
    The Committee shall review with an independent accountant and 
Management the extent to which changes or improvements in financial or 
accounting practices have been implemented. This review should be 
conducted at an appropriate time subsequent to implementation of 
changes or improvements, as decided by the Committee.
     The Committee shall advise the Governor about PRDE 
policies and procedures for compliance with applicable laws and 
regulations and PRDE code(s) of conduct.

[[Page 30708]]

     The Committee shall periodically discuss with the 
Secretary of Education, the Under Secretary of Administration and other 
Management officials as requested by the Committee (a) significant 
deficiencies in the design or operation of the internal controls that 
could adversely affect PRDE's ability to record, process, summarize, 
and report financial data, and (b) any fraud that involves Management 
or other employees who have a significant role in PRDE internal 
controls.

Annual Evaluation Procedures

    The Committee shall annually assess its performance to confirm that 
it is meeting its responsibilities under this Charter. In the review, 
the Committee shall consider, among other things, (a) the 
appropriateness of the scope and content of this Charter, (b) the 
appropriateness of matters presented for information and approval, (c) 
the sufficiency of time for consideration of agenda items, (d) 
frequency and length of meetings and (e) the quality of written 
materials and presentations. The Committee may recommend to PRDE such 
changes to this Charter as the Committee deems appropriate. The 
Committee may also evaluate its objectivity, knowledge of PRDE 
operations, and judgment, as well as members' attendance, preparation, 
and participation in meetings.

Investigations and Studies

    The Committee shall have the authority and sufficient funding to 
retain special legal, accounting or other consultants (without seeking 
PRDE approval) to advise the Committee. The Committee may conduct or 
authorize investigations into or studies of matters within the 
Committee's scope of responsibilities as described herein, and may 
retain, at the expense of PRDE, independent counsel or other 
consultants necessary to assist the Committee in any such 
investigations or studies.

Miscellaneous

    Nothing contained in the Charters is intended to expand applicable 
standards of liability under statutory or regulatory requirements for 
PRDE's Secretary or members of the Committee. The purposes and 
responsibilities outlined in this Charter are meant to serve as 
guidelines rather than as inflexible rules, and the Committee is 
encouraged to adopt such additional procedures and standards as it 
deems necessary from time to time to fulfill its responsibilities. This 
Charter, and any amendments thereto, shall be displayed on the PRDE web 
site and a printed copy of such shall be made available to any person 
who requests it.
    To the extent not prohibited by law, the President of the Committee 
may represent the entire Committee for purposes of receiving reports, 
performing reviews, and pre-approving the scope of other audit services 
to be performed by the independent auditors and the fees relating 
thereto, provided that a report on all such activities shall be 
presented to the full Audit Committee at its next meeting.
    Approved by:

Nilsa Clas, President, Audit Committee.
Rafael Aragunde Torres, Secretary, Department of Education.

Puerto Rico Department of Education Internal Audit Office--Internal 
Audit Office Charter

Introduction

    Internal auditing is an independent appraisal activity established 
within the Department of Education of Puerto Rico (PRDE) to examine and 
evaluate its activities and operations. The objectives of internal 
auditing are to assist PRDE management in the effective discharge of 
their responsibilities by furnishing them with analyses, appraisals, 
recommendations, counsel, and information concerning the activities 
reviewed and by promoting effective control at reasonable cost.

Mission Statement

    The mission of the internal audit office is to provide independent, 
objective assurance and consulting services designed to add value and 
improve the organization's operations. It helps the organization 
accomplish its objectives by bringing a systematic, disciplined 
approach to evaluate and improve the effectiveness of risk management, 
control, and governance processes.

Authority and Responsibilities

    Authorization to the Internal Audit Office and its Staff is granted 
for full and complete access to any of PRDE's records (either manual or 
electronic), physical properties, and personnel relevant to a review. 
Documents and information given to internal auditors during a periodic 
review will be handled in the same prudent manner as by those employees 
normally accountable for them.

Scope of Audits

    The Internal Auditor shall have the authority to conduct audits in 
all of PRDE's departments, programs, activities, and areas. The 
Internal Auditor's activities shall generally consist of:
    A. Reviewing activities and programs to ensure compliance with 
applicable policies, procedures, laws and regulations;
    B. Reviewing activities and programs to ensure that they are being 
conducted in a manner to efficiently and effectively accomplish the 
objectives intended by PRDE;
    C. Reviewing the reliability and integrity of financial and 
operating information and the means used to identify, measure, 
classify, and report such information;
    D. Verifying that funds are being expended in compliance with 
applicable laws and in an efficient and effective manner;
    E. Verifying that revenues are properly collected, deposited, and 
accounted for;
    F. Verifying that resources, including funds, property, and 
personnel, are adequately safeguarded, controlled, and used in an 
effective and efficient manner;
    G. Confirming that there are adequate operating and administrative 
procedures and practices, accounting internal control systems, and that 
internal management controls have been established by management;
    H. Reviewing whether risks are adequately identified and managed;
    I. Determining whether programs, plans and objectives have been 
meet.
    With the exception of special audits and those audits requiring the 
element of surprise, auditees will receive advance notice of planned 
audits, and the Internal Auditor will make an effort to schedule audits 
at mutually convenient times. Notification of special audits will be 
given as appropriate.

Standards of Practices and Code of Ethics

    The Internal Audit Office will meet or exceed the Generally 
Accepted Governmental Auditing Standards, the Standards for the 
Professional Practice of Internal Auditing and the Code of Ethics of 
The Institute of Internal Auditors. These documents are included as 
supplements to this charter.

Organization

    The Internal Audit Office will report administratively to the 
Secretary of Education and functionally directly to the Audit 
Committee. The administrative reporting will not, in any manner, 
impinge on the independence of the audit function as more fully 
described in the following sections. The Office of the Comptrollers and 
Ethics Affairs will respond to the Internal

[[Page 30709]]

Audit Office and will be in charge of all matters related to prevention 
and ethics.

Independence

    Internal Audit Office activities must be free from outside 
influence, including with regard to scope, procedures, frequency, time 
or the content of the reports, in order to ensure the independence 
necessary to develop an objective report.
    The internal auditor cannot have any direct operational 
responsibility or authority over any activity that could be subject to 
audit. Auditors cannot develop or install systems or procedures, 
prepare registries, or supervise any activity they will audit.

Objectivity

    Objectivity is an independent mental attitude which internal 
auditors should maintain in performing audits. Internal auditors are 
not to subordinate their judgment on audit matters to that of others.
    Objectivity requires that internal auditors perform audits in such 
a manner that they have an honest belief in their work product and that 
no significant quality compromises are made. Internal auditors are not 
to be placed in situations in which they feel unable to make objective 
professional judgments.

Audit Annual Work Plan

    Annually, the Chief Auditing Executive will submit to the Audit 
Committee and the Secretary of Education an itinerary of the Internal 
Audit Office's scope of work for the next year. This itinerary will be 
based on the priorities of the audit universe using relevant risk 
factors. Any deviation to the work plan must be approved by the Audit 
Committee and communicated to the Secretary of Education. The Committee 
will be responsible for the approval of the annual audit work plan. The 
Secretary of Education can recommend the inclusion of additional 
aspects to be considered in this audit plan. The Committee will review 
the recommendation and will make the decision whether or not to include 
the areas recommended.

Audit Reports

    A written audit report will be prepared and issued by the Chief 
Auditing Executive following the conclusion of each audit. Once 
finalized, the report will be distributed as appropriate. The manager 
of the activity or department receiving the report will respond to any 
recommendations within thirty days. The response will indicate what 
actions were taken regarding specific report findings and 
recommendations. If a response is not received within thirty days, the 
Chief Internal Auditor will contact the Deputy Secretary of 
Administration for assistance in resolving the matter.

Audit Reports to the Audit Committee

    A. Each audit will result in a written final report.
    B. The Internal Audit Office shall submit copies of each audit 
report to the Audit Committee and shall retain a copy as a permanent 
record.
    C. The Internal Audit Office shall include in the audit reports, 
where applicable:
    1. A precise statement of scope encompassed by the audit;
    2. A statement that the audit was performed in accordance with 
generally accepted auditing standards;
    3. A statement of the time frame covered by the audit;
    4. A statement of significant audit findings including a statement 
of the underlying causes, evaluation criteria used, and the current and 
prospective significance of the findings;
    5. Statements of response submitted by the auditees relevant to the 
audit findings;
    6. Recommendations for additional necessary or desirable action.

Continued Education

    All Auditors shall take 40 credit hours of continued education at 
least every two years. Of those 40 hours, at least 24 must be directly 
related to audit themes. The Internal Audit Office will be responsible 
for accounting for these hours and coordinating the different courses 
and workshops to assure compliance.

Confidentiality

    All information related to an audit will be managed with the 
strictest confidentiality. This information cannot be use for purposes 
other than to express an opinion over the operation that has been 
audited. No auditor is authorized to solicit any information that is 
unrelated to an aspect being evaluated in the normal course of an audit 
being performed. The disclosure of confidential information constitutes 
a violation of the Code of Ethics, the Standards for the Audit 
Profession, and the Internal Rules of the Internal Audit Office.

Due Professional Care

    All work performed by the Internal Audit Office will be performed 
with due professional care following practice standards.

Effective Date

    This charter will be effective from the date of approval by the 
Secretary of Education and the Audit Committee. This charter will 
replace the one approved by the Secretary of Education on July 2, 2001.

    Dated: May 18, 2007.

    Presented by:

Eda L. Vel[aacute]zquez-Caraballo,
Chief Audit Executive.
Nilsa Clas,
President, Audit Committee.
    Approved By:

Rafael Aragunde Torres,
Secretary of Education.
[FR Doc. E8-11852 Filed 5-27-08; 8:45 am]
BILLING CODE 4000-01-P