[Federal Register Volume 77, Number 119 (Wednesday, June 20, 2012)]
[Proposed Rules]
[Pages 36958-36964]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2012-14954]


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DEPARTMENT OF EDUCATION

34 CFR Chapter II

DEPARTMENT OF HEALTH AND HUMAN SERVICES

45 CFR Subtitle A, Subchapter A

[Docket ID ED-2012-OESE-0012; CFDA Number 84.412A]
RIN 1810-AB15


Proposed Requirements--Race to the Top--Early Learning Challenge; 
Phase 2

AGENCY: Department of Education and Department of Health and Human 
Services.

ACTION: Proposed requirements.

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SUMMARY: The Secretary of Education and the Secretary of Health and 
Human Services (hereafter ``the Secretaries'') propose requirements for 
Phase 2 of the Race to the Top--Early Learning Challenge (RTT-ELC) 
program. In this phase (Phase 2 of the RTT-ELC program), we would make 
awards to certain States that applied for, but did not receive, funding 
under Phase 1 of the RTT-ELC competition held in fiscal year (FY) 2011 
(FY 2011 RTT-ELC competition). Specifically, we would consider eligible 
the five highest-scoring applicants that did not receive funding in the 
FY 2011 RTT-ELC competition, each of which received approximately 75 
percent or more of the available points under the competition. We take 
this action to fund down the slate of the FY 2011 RTT-ELC competition 
and to establish the information and assurances that the eligible 
applicants would need to provide in order to receive funding under 
Phase 2 of the RTT-ELC program.

DATES: We must receive your comments on or before July 20, 2012.

ADDRESSES: Submit your comments through the Federal eRulemaking Portal 
or via postal mail, commercial delivery, or hand delivery. We will not 
accept comments by fax or by email. To ensure that we do not receive 
duplicate copies, please submit your comments only once. In addition, 
please include the Docket ID and the term ``Race to the Top-Early 
Learning Challenge Phase 2 Awards'' at the top of your comments.
     Federal eRulemaking Portal: Go to www.regulations.gov to 
submit your comments electronically. Information on using 
Regulations.gov, including instructions for accessing agency documents, 
submitting comments, and viewing the docket, is available on the site 
under ``How to Use This Site.''
     Postal Mail, Commercial Delivery, or Hand Delivery. If you 
mail or deliver your comments about these proposed requirements, 
address them to the Office of Elementary and Secondary Education 
(Attention: Race to the Top-Early Learning Challenge Phase 2 Comments), 
U.S. Department of Education, 400 Maryland Avenue SW., Washington, DC 
20202-6200.

    Privacy Note:
    The Department of Education's policy is to make all comments 
received from members of the public available for public viewing in 
their entirety on the Federal eRulemaking Portal at 
www.regulations.gov. Therefore, commenters should be careful to 
include in their comments only information that they wish to make 
publicly available.


FOR FURTHER INFORMATION CONTACT: Deborah Spitz, U.S. Department of 
Education, 400 Maryland Avenue SW., Room 3E230, Washington, DC 20202-
6200. Telephone: (202) 260-3793 or by email: 
[email protected].
    If you use a telecommunications device for the deaf (TDD) or a text 
telephone (TTY), call the Federal Relay Service (FRS), toll free, at 1-
800-877-8339.

SUPPLEMENTARY INFORMATION:

Executive Summary

    Purpose of This Regulatory Action: The Departments of Education and 
Health and Human Services (Departments) plan to implement Phase 2 of 
the RTT-ELC program by funding down the slate from the FY 2011 RTT-ELC 
competition. Specifically, the Departments plan to make awards 
available to the next five highest-scoring applicants that did not 
receive funding under the FY 2011 RTT-ELC competition. Because the 
amount of available funds in FY 2012 is limited, this action proposes 
specific requirements that the five eligible applicants must meet in 
order to receive up to 50 percent of the funds they requested in their 
FY 2011 RTT-ELC applications.
    Summary of the Major Provisions of This Regulatory Action: In this 
notice, we propose to establish a limited number of application 
requirements, assurances, and budget requirements that the five 
eligible applicants must meet in order to receive funds under Phase 2 
of the RTT-ELC program.
    The Application Requirements, which can be found in section III of 
the Proposed Requirements section of this notice, include a requirement 
that each eligible applicant must: (1) Describe how it would implement 
the activities proposed in Core Area B (selection

[[Page 36959]]

criteria one through five) of its FY 2011 RTT-ELC application; (2) 
describe how it would implement the activities proposed in Competitive 
Preference Priority 2 of its FY 2011 RTT-ELC application; and (3) from 
two or more of the three Focused Investment Areas (C, D, and E) in its 
FY 2011 RTT-ELC application, select activities proposed in response to 
one or more selection criteria. The Application Requirements section 
further explains how applicants may make adjustments to the scope of 
the activities they proposed in their FY 2011 RTT-ELC applications to 
ensure that the activities can be carried out successfully with the 
amount of funds available in Phase 2 of the RTT-ELC program.
    The Application Assurances, which can be found in section IV of the 
Proposed Requirements section of this notice, include a set of 
assurances for eligible applicants to include in their applications for 
Phase 2 RTT-ELC awards. These assurances relate to commitments made in 
the FY 2011 RTT-ELC applications. For example, in order to receive a 
Phase 2 RTT-ELC award, an eligible applicant must maintain the 
commitments made in Section A(1) of its FY 2011 RTT-ELC application, 
which describes existing State funding for early learning. Each 
eligible applicant must also maintain commitments to engage in 
partnerships described in its FY 2011 RTT-ELC application. This is 
important because the strength of these commitments influenced how 
reviewers scored the FY 2011 RTT-ELC applications. These commitments 
are also critical to building strong State systems of early learning 
and development.
    The proposed Budget Requirements, which can be found in section V 
of the Proposed Requirements section of this notice, require that an 
eligible applicant complete a revised budget and narrative that 
includes an explanation of why the eligible applicant has selected the 
activities it proposes to carry out (as described under ``Application 
Requirements'') and why such activities will have the greatest impact 
on advancing its high-quality plan for early learning.
    Costs and Benefits: We have determined that these proposed 
requirements would not impose significant additional costs to States, 
the eligible applicants under the RTT-ELC program, or the Federal 
Government and that the potential benefits would exceed the costs. The 
Departments believe States would incur minimal costs in developing 
plans and budgets for implementing selected activities from their FY 
2011 RTT-ELC proposals, because such planning would entail revisions to 
existing plans and budgets already developed as part of the FY 2011 
RTT-ELC application process.
    Invitation to Comment: We invite you to submit comments regarding 
this notice. To ensure that your comments have maximum effect in 
developing the notice of final requirements, we urge you to identify 
clearly the specific proposed requirement that each comment addresses.
    We invite you to assist us in complying with the specific 
requirements of Executive Orders 12866 and 13563 and their overall 
requirement of reducing regulatory burden that might result from these 
proposed requirements. Please let us know of any further ways we could 
reduce potential costs or increase potential benefits while preserving 
the effective and efficient administration of the program.
    During and after the comment period, you may inspect all public 
comments about this notice by accessing Regulations.gov. You may also 
inspect the comments in person in room 3E230, 400 Maryland Avenue SW., 
Washington, DC, between the hours of 8:30 a.m. and 4:00 p.m., 
Washington, DC time, Monday through Friday of each week except Federal 
holidays. Please contact the person listed under FOR FURTHER 
INFORMATION CONTACT.
    Assistance to Individuals with Disabilities in Reviewing the 
Rulemaking Record: On request we will provide an appropriate 
accommodation or auxiliary aid to an individual with a disability who 
needs assistance to review the comments or other documents in the 
public rulemaking record for this notice. If you want to schedule an 
appointment for this type of accommodation or auxiliary aid, please 
contact the person listed under FOR FURTHER INFORMATION CONTACT.
    Purpose of Program: The purpose of the RTT-ELC program is to 
improve the quality of early learning and development and close the 
achievement gap for children with high needs. This program focuses on 
improving early learning and development for young children by 
supporting States' efforts to increase the number and percentage of 
low-income and disadvantaged children, in each age group of infants, 
toddlers, and preschoolers, who are enrolled in high-quality early 
learning and development programs; and designing and implementing an 
integrated system of high-quality early learning and development 
programs and services.
    Program Authority: Sections 14005 and 14006, Division A, of the 
American Recovery and Reinvestment Act of 2009, as amended by section 
1832(b) of Division B of Public Law 112-10, the Department of Defense 
and Full-Year Continuing Appropriations Act, 2011, and the Department 
of Education Appropriations Act, 2012 (Title III of Division F of Pub. 
L. 112-74, the Consolidated Appropriations Act, 2012).

Proposed Requirements

    Background:
    A critical focus of the Departments is supporting America's 
youngest learners and helping ensure that children, especially young 
children with high needs, such as those who are from low-income 
families, English learners, and children with disabilities or 
developmental delays, enter kindergarten ready to succeed in school and 
in life. A robust body of research demonstrates that high-quality early 
learning and development programs and services can improve young 
children's health, social-emotional, and cognitive outcomes; enhance 
school readiness; and help close the school readiness gap1 2 
that exists between children with high needs and their peers at the 
time they enter kindergarten.3 4
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    \1\ Camilli, G., Vargas, S., Ryan, S., & Barnett, W. S. (2010). 
Meta-analysis of the effects of early education interventions on 
cognitive and social development. Teachers College Record, 112(3), 
579-620.
    \2\ Reynolds, A.J., Temple, J.A., Ou, S., Arteaga, I.A., & 
White, B.A.B. (2011). School-based early childhood education and 
age-28 well-being: effects by timing, dosage, and subgroups. 
Science, Retrieved from http://www.sciencemag.org/content/early/2011/06/08/science.1203618.abstract doi: 10.1126/science.1203618.
    \3\ Princiotta, D., Flanagan, K. D., and Germino Hausken, E. 
(2006). Fifth Grade: Findings From The Fifth-Grade Follow-up of the 
Early Childhood Longitudinal Study, Kindergarten Class of 1998-99 
(ECLS-K). (NCES 2006-038) U.S. Department of Education.
    \4\ Halle, T., Forry, N., Hair, E., Perper, K., Wandner, L., 
Wessel, J., & Vick, J.(2009). Disparities in Early Learning and 
Development: Lessons from the Early Childhood Longitudinal Study--
Birth Cohort (ECLS-B). Washington, DC: Child Trends.
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    To address this school readiness gap, the Departments have 
identified, as high priorities, strengthening the quality of early 
learning and development programs and increasing access to high-quality 
early learning and development programs for all children, including 
those with high needs.
    On May 25, 2011, Secretaries Arne Duncan and Kathleen Sebelius 
announced the Race to the Top-Early Learning Challenge, a new $500 
million State-level grant competition authorized under the American 
Recovery and Reinvestment Act of 2009 (ARRA), as amended by section 
1832(b) of the Department of Defense and Full-Year Continuing 
Appropriations Act, 2011. Through the RTT-ELC program, the

[[Page 36960]]

Departments seek to help close the achievement gap between children 
with high needs and their peers by supporting State efforts to build 
strong systems of early learning and development that provide increased 
access to high-quality programs for the children who need them most.
    The FY 2011 RTT-ELC competition represented an unprecedented 
opportunity for States to focus deeply on their early learning and 
development systems for children from birth through age five. (See 
notice inviting applications for the competition, published in the 
Federal Register on August 26, 2011 (76 FR 53564).) Through the FY 2011 
RTT-ELC competition, States were given an opportunity to build a more 
unified approach to supporting young children and their families--an 
approach that increases access to high-quality early learning and 
development programs and services and helps ensure that children enter 
kindergarten with the skills, knowledge, and dispositions toward 
learning they need to be successful.
    In December 2011, the Departments made awards to the nine highest-
scoring applications from the FY 2011 RTT-ELC competition: California, 
Delaware, Maryland, Massachusetts, Minnesota, North Carolina, Ohio, 
Rhode Island, and Washington. (Due to the limited amount of funding 
available and its ranking on the slate, California received 
approximately half of the funding it requested.)
    On December 23, 2011, Public Law 112-74, the Consolidated 
Appropriations Act, 2012, which made $550 million available for the 
Race to the Top Fund, was signed into law. This legislation authorized 
the Secretary of Education to make Race to the Top Fund awards on ``the 
basis of previously submitted applications.'' The Department of 
Education must obligate these funds by December 31, 2012.
    On April 9, 2012, the Departments announced that approximately $133 
million of the $550 million appropriated for the Race to the Top Fund 
would be made available to the next five highest-scoring applicants 
from the FY 2011 RTT-ELC competition. These five applicants, each of 
which received approximately 75 percent or more of the available points 
under the competition, are Colorado, Illinois, New Mexico, Oregon, and 
Wisconsin. Throughout this notice, these States are referred to as 
``eligible applicants'' for Phase 2 of the RTT-ELC program, under which 
the Departments will fund down the slate of applications from the FY 
2011 RTT-ELC competition. While $133 million is not sufficient to 
support full implementation of the plans submitted by these States in 
the FY 2011 RTT-ELC competition, the Secretaries believe that 
supporting high-scoring applicants that did not receive funding under 
the FY 2011 RTT-ELC competition with FY 2012 funding will help build on 
the momentum from the FY 2011 RTT-ELC competition and engage more 
States to transform the patchwork of disconnected early childhood 
programs into a coordinated and high-quality system. Therefore, we 
propose to make FY 2012 funds available to the eligible applicants at 
up to 50 percent of the funds each requested in its application for 
funds under the FY 2011 RTT-ELC competition. Through this notice, we 
propose the requirements for implementing Phase 2 of the RTT-ELC 
program, under which the Departments will fund down the slate from the 
FY 2011 RTT-ELC competition.
    The Department of Education may use any unused funds from Phase 2 
of the RTT-ELC program to make awards in the FY 2012 district-level 
Race to the Top competition, which will be announced in a separate 
notice published in the Federal Register. Conversely, the Department of 
Education may use any unused FY 2012 funds from the district-level Race 
to the Top Fund competition to supplement the awards for Phase 2 of the 
RTT-ELC program.
    In this notice, we propose specific requirements that eligible 
applicants would have to meet in order to apply for up to 50 percent of 
the funds they requested in their FY 2011 RTT-ELC competition 
applications.
    The FY 2011 RTT-ELC competition identified five key reform areas 
representing the foundation of an effective early learning and 
development reform agenda that is focused on school readiness and 
ongoing educational success. These areas, which provided a framework 
for the competition's priorities, requirements, and selection criteria, 
are as follows:
    (A) Successful State Systems;
    (B) High-Quality, Accountable Programs;
    (C) Promoting Early Learning and Development Outcomes for Children;
    (D) A Great Early Childhood Education Workforce; and
    (E) Measuring Outcomes and Progress.
    The first two of these reform areas, (A) and (B), are core areas of 
focus for this program (hereafter ``Core Areas''), and applicants under 
the FY 2011 RTT-ELC competition were required to respond to all 
selection criteria under these Core Areas. The reform areas in (C), 
(D), and (E) are areas (hereafter ``Focused Investment Areas'') where 
applicants directed targeted attention to specific activities that were 
relevant to their State's context. Applicants were required to address 
each Focused Investment Area but not all of the selection criteria 
under them.

Proposed Requirements

    The Departments propose the following requirements to implement 
Phase 2 of the RTT-ELC program. Except where otherwise indicated in 
this notice, the priorities, requirements, and definitions in the 
notice inviting applications for the FY 2011 RTT-ELC competition, 
published in the Federal Register on August 26, 2011 (76 FR 53564), 
would also apply to the RTT-ELC Phase 2 application process.

I. Proposed Eligibility Requirements

    Eligible applicants for the Phase 2 RTT-ELC award process are those 
States that applied for funding under the FY 2011 RTT-ELC competition 
and received approximately 75 percent or more of the available points, 
but that did not receive grant awards under that competition. 
Therefore, only the States of Colorado, Illinois, New Mexico, Oregon, 
and Wisconsin are eligible to apply for Phase 2 RTT-ELC awards.

II. Proposed Award Process

    To receive a Phase 2 RTT-ELC award, an eligible applicant must 
submit--
    (a) An application, consistent with its FY 2011 RTT-ELC 
application, that--
    (1) Meets the application requirements described in the Proposed 
Application Requirements section of this notice; and
    (2) Provides the assurances described in the Proposed Application 
Assurances section of this notice; and
    (b) For review and approval by both Departments, a detailed plan 
and budget describing the activities selected from its FY 2011 RTT-ELC 
application that would be implemented with Phase 2 RTT-ELC funding, in 
accordance with the Budget Requirements in this notice.

    Note: We encourage eligible applicants to partner with each 
other and currently funded RTT-ELC grantees in carrying out specific 
activities (such as validation of a State's Tiered Quality Rating 
and Improvement System (TQRIS), implementation of longitudinal data 
systems, or development of a kindergarten entry assessment). Each 
eligible applicant may apply for Phase 2 RTT-ELC awards individually 
or as a member of a consortium (with other eligible applicants) 
under 34 CFR 75.127-129. In any event, an eligible applicant must 
propose activities for Phase 2 of the RTT-ELC program that are 
consistent with its FY 2011 RTT-ELC application.


[[Page 36961]]



III. Proposed Application Requirements

    We propose the following application requirements for eligible 
applicants that apply for Phase 2 RTT-ELC awards:
    (a) Each eligible applicant must describe how it would implement an 
organizational structure for managing the grant that is consistent with 
the activities and commitments described in response to selection 
criterion A(3)(a)(1) \5\ of its FY 2011 RTT-ELC application, and 
describe how it would implement the activities described in response to 
Core Area B (selection criteria one through five) of its FY 2011 RTT-
ELC application using a Phase 2 RTT-ELC award. The FY 2011 RTT-ELC Core 
Area B criteria promote broad participation in the State's TQRIS across 
a range of programs, active and continuous program quality improvement, 
and the publication of program ratings so that families can make 
informed decisions about which programs can best serve the needs of 
their children. Specifically, in Core Area B of its FY 2011 RTT-ELC 
application, each applicant had to demonstrate that it had developed 
and adopted, or had a high-quality Plan to develop and adopt, a TQRIS. 
In addition, each applicant must also implement the activities proposed 
under Competitive Preference Priority 2, including all early learning 
and development programs in the TQRIS.
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    \5\ The selection criteria from the FY 2011 RTT-ELC application 
can be found at http://www2.ed.gov/programs/racetothetop-earlylearningchallenge/2011-412.doc (pp. 26-74).
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    (b) In addition to addressing the requirements in paragraph (a) of 
this section, each eligible applicant must select and describe how it 
will implement activities that it identified in its FY 2011 RTT-ELC 
application in response to Focused Investment Areas C, D, or E. The 
eligible applicant must select activities from two or more of the three 
Focused Investment Areas C, D, and E, and the activities must be 
responsive to one or more of the selection criteria under the Focused 
Investment Areas chosen by the applicant. (Eligible applicants may 
implement additional activities proposed under more than one selection 
criterion within each Focused Investment Area.) In determining which 
selection criteria to address given the amount of available funds under 
Phase 2 of the RTT-ELC program, each eligible applicant should give 
consideration to those activities that will have the greatest impact on 
improving access to high-quality early learning programs for children 
with high needs.


    Note: In light of the reduced funding available, applicants may 
make adjustments in the scope of services provided to meet selection 
criteria in Focused Investment Areas C, D, and E. For example, an 
applicant may propose to serve fewer programs or regions of the 
State than it proposed to serve in its FY 2011 RTT-ELC application. 
The eligible applicant must provide a detailed explanation of its 
rationale for such adjustments and also must amend its targets in 
Tables B(2)(c) and B(4)(c)(1-2) of the FY 2011 RTT-ELC application, 
as needed. Applicants should ensure that the adjustments do not 
diminish the program's impact on improving access to high quality 
early learning programs for children with high needs. In addition, 
when the scope of work is adjusted by targeting specific regions in 
the State, the activities should be consistent across regions.

    (c) In addition, each eligible applicant may implement the 
activities it proposed in response to the Invitational Priorities from 
its FY 2011 RTT-ELC application. Eligible applicants that wrote to 
Invitational Priority 2 are encouraged to pursue public-private 
partnerships to the extent that this will augment total funds available 
for carrying out the activities described in the FY 2011 RTT-ELC 
application. Note: We encourage grantees to enter into consortia, where 
relevant, in order to maximize the use of available funds. Please refer 
to section (V)(B) later in this notice.
    (d) We will use Phase 2 RTT-ELC funding to support only those 
activities included in an eligible applicant's FY 2011 RTT-ELC 
application. Therefore, an eligible applicant must not include new 
activities in its Phase 2 RTT-ELC application.
    (e) Each Phase 2 RTT-ELC application must include current 
signatures by the eligible applicant's Governor or an authorized 
representative signing on behalf of the Governor; an authorized 
representative from the eligible applicant's Lead Agency; and an 
authorized representative from each Participating State Agency.
    (f) Each Phase 2 RTT-ELC application must include a newly signed 
Memorandum of Understanding and a preliminary scope of work for each 
Participating State Agency.

IV. Proposed Application Assurances

    Each eligible applicant must include in its Phase 2 RTT-ELC 
application the following assurances from its Governor or authorized 
representative of the Governor of its State:
    (a) While the State may make appropriate adjustments to the scope, 
budget, timeline, and performance targets, consistent with the reduced 
amount of funding that is available under the Phase 2 RTT-ELC award 
process, the State will maintain consistency with the absolute priority 
and all program and eligibility requirements of the FY 2011 RTT-ELC 
competition.
    (b) The State will maintain its commitment to and investment in 
high-quality, accessible early learning and development programs and 
services for children with high needs, as described in Section A(1) of 
its FY 2011 RTT-ELC application.
    (c) Subject to adjustments due to the reduced amount of funding 
available under the Phase 2 RTT-ELC award process, the State will 
maintain its plan to establish strong participation and commitment by 
Participating State Agencies and other early learning and development 
stakeholders as described in Section A(3) of its FY 2011 RTT-ELC 
application.
    (d) The State will maintain its commitment to integrating and 
aligning resources and policies across Participating State Agencies as 
described in Section A(3) of its FY 2011 RTT-ELC application.
    (e) The State will comply with all of the accountability, 
transparency, and reporting requirements that applied to the FY 2011 
RTT-ELC competition. (See the notice inviting applications for the FY 
2011 RTT-ELC competition, published in the Federal Register on August 
26, 2011 (76 FR 53564).)
    (f) The State will comply with the requirements of any evaluation 
of the RTT-ELC program, or of specific activities it proposes to pursue 
as part of the program, conducted and supported by the Departments.

V. Proposed Budget Requirements

    An eligible applicant may apply for up to 50 percent of the funds 
requested in its FY 2011 RTT-ELC application. The following budget 
requirements would apply to the Phase 2 RTT-ELC award process:
    (a) Budget Narrative. Each eligible applicant must submit a 
detailed narrative and budget, using the format and instructions 
provided in the FY 2011 RTT-ELC application package, which describes 
the activities it has selected from its FY 2011 RTT-ELC application 
that it proposes to implement with a Phase 2 RTT-ELC award. This 
detailed narrative must include an explanation of why the eligible 
applicant has selected these activities and why the eligible applicant 
believes they will have the greatest impact on advancing its high-
quality plan for early learning. The narrative must also explain where 
the applicant has made adjustments (such as a

[[Page 36962]]

reduction in the number of participating programs or areas of the State 
served) to ensure that the activities can be carried out successfully 
with the amount of funds available. In reviewing the narrative, we may 
request the applicant submit revisions to address concerns related to 
feasibility or the strategic use of funds. (See the notice inviting 
applications for the FY 2011 RTT-ELC competition, published in the 
Federal Register on August 26, 2011 (76 FR 53564).)
    (b) Applying as a Consortium. As discussed elsewhere in this 
notice, we encourage eligible applicants to form consortia with each 
other and partner with currently funded RTT-ELC grantees in carrying 
out specific activities (such as validation of a State's TQRIS, 
implementation of longitudinal data systems, or development of a 
kindergarten entry assessment). Eligible applicants may apply 
individually or as members of a consortium (with other eligible 
applicants) under 34 CFR 75.127-129. Each applicant must propose 
activities consistent with its FY 2011 RTT-ELC application. Therefore, 
each eligible applicant that chooses to apply as a member of a 
consortium or to partner with a current RTT-ELC grantee in carrying out 
project activities must include in its revised budget narrative an 
explanation of how the activities to be undertaken by the consortium or 
partnership are consistent with the applicant's FY 2011 RTT-ELC 
application and how the consortium or partnership will help the 
applicant implement its selected activities. It is important to note 
that an applicant may propose some activities that it would execute 
alone and others that it would execute as part of a consortium.
    (c) Available Funds. The maximum amounts of funding for which each 
eligible applicant may apply are shown in the following table. The 
amounts in this table are based on the requirement that each eligible 
applicant may apply for up to half of the amount it requested in its FY 
2011 RTT-ELC application.

------------------------------------------------------------------------
                        State                           Maximum amount
------------------------------------------------------------------------
Colorado............................................         $29,925,888
Illinois............................................          34,798,696
New Mexico..........................................          25,000,000
Oregon..............................................          20,508,902
Wisconsin...........................................          22,701,389
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    Final Requirements:
    We will announce the final requirements for the Phase 2 RTT-ELC 
award process in a notice in the Federal Register. We will determine 
the final requirements after considering any comments submitted in 
response to this notice and other information available to the 
Departments. This notice does not preclude the Departments from 
proposing additional priorities, requirements, definitions, or 
selection criteria, subject to meeting applicable rulemaking 
requirements.

    Note: This notice does not solicit applications. In any year in 
which we choose to use one or more of these requirements, we invite 
applications through a notice in the Federal Register.

Executive Orders 12866 and 13563

Regulatory Impact Analysis

    Under Executive Order 12866, the Secretaries must determine whether 
a regulatory action is ``significant'' and, therefore, subject to the 
requirements of the Executive order and subject to review by the Office 
of Management and Budget (OMB). Section 3(f) of Executive Order 12866 
defines a ``significant regulatory action'' as an action likely to 
result in a rule that may--
    (1) Have an annual effect on the economy of $100 million or more, 
or adversely affect a sector of the economy, productivity, competition, 
jobs, the environment, public health or safety, or State, local or 
Tribal governments or communities in a material way (also referred to 
as an ``economically significant'' rule);
    (2) Create serious inconsistency or otherwise interfere with an 
action taken or planned by another agency;
    (3) Materially alter the budgetary impacts of entitlement grants, 
user fees, or local programs or the rights and obligations of 
recipients thereof; or
    (4) Raise novel legal or policy issues arising out of legal 
mandates, the President's priorities, or the principles stated in the 
Executive order.
    This regulatory action would have an annual effect on the economy 
of more than $100 million because the amount of government transfers 
through the Phase 2 RTT-ELC award process exceeds that amount. 
Therefore, this proposed action is ``economically significant'' and 
subject to review by OMB review under section 3(f)(1) of Executive 
Order 12866. Notwithstanding this determination, we have assessed the 
potential costs and benefits--both quantitative and qualitative--of 
this proposed regulatory action and have determined that the benefits 
would justify the costs.
    The Departments have also reviewed these proposed requirements 
under Executive Order 13563, which supplements and explicitly reaffirms 
the principles, structures, and definitions governing regulatory review 
established in Executive Order 12866. To the extent permitted by law, 
Executive Order 13563 requires that an agency--
    (1) Propose or adopt regulations only upon a reasoned determination 
that their benefits justify their costs (recognizing that some benefits 
and costs are difficult to quantify);
    (2) Tailor its regulations to impose the least burden on society, 
consistent with obtaining regulatory objectives, taking into account--
among other things, and to the extent practicable--the costs of 
cumulative regulations;
    (3) In choosing among alternative regulatory approaches, select 
those approaches that maximize net benefits (including potential 
economic, environmental, public health and safety, and other 
advantages; distributive impacts; and equity);
    (4) To the extent feasible, specify performance objectives, rather 
than specifying the behavior or manner of compliance a regulated entity 
must adopt; and
    (5) Identify and assess available alternatives to direct 
regulation, including providing economic incentives--such as user fees 
or marketable permits--to encourage the desired behavior, or provide 
information that enables the public to make choices.
    Executive Order 13563 also requires an agency ``to use the best 
available techniques to quantify anticipated present and future 
benefits and costs as accurately as possible.'' The Office of 
Information and Regulatory Affairs of OMB has emphasized that these 
techniques may include ``identifying changing future compliance costs 
that might result from technological innovation or anticipated 
behavioral changes.''
    We are issuing these proposed requirements only on a reasoned 
determination that their benefits justify their costs. In choosing 
among alternative regulatory approaches, we selected those approaches 
that would maximize net benefits. Based on the analysis that follows, 
the Departments believe these proposed regulations are consistent with 
the principles in Executive Order 13563.
    We have also determined that this regulatory action would not 
unduly interfere with State, local, and tribal governments in the 
exercise of their governmental functions.
    In this regulatory impact analysis we discuss the need for 
regulatory action, the potential costs and benefits, net budget 
impacts, assumptions, limitations, and data sources, as well as 
regulatory alternatives we considered.

[[Page 36963]]

Need for Federal Regulatory Action

    These proposed requirements are needed to implement the Phase 2 
RTT-ELC award process in the manner that the Departments believe will 
best enable the program to achieve its objectives of creating the 
conditions for effective reform in State early learning systems in 
States that had high-scoring applications in the FY 2011 RTT-ELC 
competition but that did not receive funding in that competition, to 
implement key elements of their comprehensive reform proposals 
submitted as part of their FY 2011 RTT-ELC competition applications.

Potential Costs and Benefits

    Under Executive Order 12866, we have assessed the potential costs 
and benefits of this regulatory action and have determined that these 
proposed requirements would not impose significant additional costs to 
State applicants or the Federal Government. Most of the proposed 
requirements contained in this notice involve re-affirming State 
commitments and plans already completed as part of the FY 2011 RTT-ELC 
competition or other Federal education programs. Similarly, other 
proposed requirements, in particular those related to maintaining 
conditions for reform required under the FY 2011 RTT-ELC competition, 
would require continuation of existing commitments and investments 
rather than the imposition of additional burdens and costs. The 
Departments believe those States that are eligible for Phase 2 awards 
would incur minimal costs in developing plans and budgets for 
implementing selected activities from their FY 2011 RTT-ELC competition 
proposals, because in most cases such planning would entail revisions 
to existing plans and budgets already developed as part of the FY 2011 
RTT-ELC application process and not the development and implementation 
of entirely new plans and budgets. In all such cases, the Departments 
believe that the benefits resulting from the proposed requirements for 
the Phase 2 RTT-ELC award process, would exceed their costs.

Regulatory Alternatives Considered

    An alternative to promulgation of the types of requirements 
proposed in this notice would be to use FY 2012 Race to the Top funds 
to make awards to the one or two highest-scoring unfunded applications 
from the FY 2011 RTT-ELC competition and to use the remaining funds for 
the Race to the Top district-level competition to be held in FY 2012. 
We have concluded that approximately $400 million in available FY 2012 
funds is necessary to support a meaningful district-level competition.
    Moreover, the Departments believe that simply funding the one or 
two highest-scoring applicants that were not selected in the FY 2011 
RTT-ELC competition would result in a missed opportunity to reward the 
efforts of other high-scoring applicants from that competition and to 
enable them to make meaningful progress on key elements of their State 
early learning plans.
    To assist the Departments in complying with the requirements of 
Executive Order 12866, the Secretaries invite comments on whether there 
may be further opportunities to reduce any potential costs or increase 
potential benefits resulting from these proposed requirements without 
impeding the effective and efficient administration of the RTT-ELC 
program.

Accounting Statement

    As required by OMB Circular A-4 (available at www.whitehouse.gov/sites/default/files/omb/assets/omb/circulars/a004/a-4.pdf), in the 
following table we have prepared an accounting statement showing the 
classification of the expenditures associated with the provisions of 
this proposed regulatory action. This table provides our best estimate 
of the Federal payments to be made to States under this program as a 
result of this proposed regulatory action. Expenditures are classified 
as transfers to States.

      Accounting Statement Classification of Estimated Expenditures
------------------------------------------------------------------------
                 Category                             Transfers
------------------------------------------------------------------------
Annualized Monetized Transfers............  $132,934,875.
From Whom To Whom?                          Federal Government to
                                             States.
------------------------------------------------------------------------

    The Phase 2 RTT-ELC award process would provide approximately $133 
million in competitive grants to eligible applicants (those five 
applicants that did not receive funding in the FY 2011 RTT-ELC 
competition, but which received approximately 75 percent or more of the 
available points under the competition).

Regulatory Flexibility Act Certification

    The Secretaries certify that this proposed regulatory action will 
not have a significant economic impact on a substantial number of small 
entities. This proposed regulatory action will not have a significant 
economic impact on small entities (such as subaward recipients) because 
they will be able to meet the costs of compliance with this regulatory 
action using the funds provided under this program.
    The Secretaries invite comments from small entities as to whether 
they believe this proposed regulatory action would have a significant 
economic impact on them and, if so, request evidence to support that 
belief.

Paperwork Reduction Act of 1995

    These proposed requirements contain information collection 
requirements. However, because the eligible applicants for Phase 2 RTT-
ELC awards are fewer than 10, these collections are not subject to 
approval under the Paperwork Reduction Act of 1995 (44 U.S.C. 
3502(3)(A)(i)).
    Intergovernmental Review: This program is subject to Executive 
Order 12372 and the regulations in 34 CFR part 79. One of the 
objectives of the Executive order is to foster an intergovernmental 
partnership and a strengthened federalism. The Executive order relies 
on processes developed by State and local governments for coordination 
and review of proposed Federal financial assistance.
    This document provides early notification of our specific plans and 
actions for this program.
    Assessment of Educational Impact: In accordance with section 411 of 
the General Education Provisions Act, 20 U.S.C. 1221e-4, the 
Departments invite comment on whether these proposed requirements would 
require transmission of information that any other agency or authority 
of the United States gathers or makes available.
    Accessible Format: Individuals with disabilities can obtain this 
document in an accessible format (e.g., braille, large print, 
audiotape, or computer disc) on request to the program contact person 
listed under FOR FURTHER INFORMATION CONTACT.
    Electronic Access to This Document: The official version of this 
document is the document published in the Federal Register. Free 
Internet access to the official edition of the Federal Register is 
available via the Federal Digital System at www.gpo.gov/fdsys. At this 
site you can view this document, as well as all other documents of 
these Departments published in the Federal Register, in text or Adobe 
Portable Document Format (PDF). To use PDF you must have Adobe Acrobat 
Reader, which is available free at this site.
    You may also access documents of these Departments published in the 
Federal Register by using the article search feature at 
www.federalregister.gov. Specifically,

[[Page 36964]]

through the advanced search feature at this site, you can limit your 
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    Dated: June 14, 2012.
Arne Duncan,
Secretary of Education.
Kathleen Sebelius,
Secretary of Health and Human Services.
[FR Doc. 2012-14954 Filed 6-19-12; 8:45 am]
BILLING CODE 4000-01-P