[Title 34 CFR ]
[Code of Federal Regulations (annual edition) - January 1, 2005 Edition]
[From the U.S. Government Printing Office]



[[Page i]]



          34


          Parts 300 to 399

                         Revised as of July 1, 2004


          Education
          
          


________________________

          Containing a codification of documents of general 
          applicability and future effect

          As of July 1, 2004
          With Ancillaries
                    Published by
                    Office of the Federal Register
                    National Archives and Records
                    Administration
                    A Special Edition of the Federal Register





                     U.S. GOVERNMENT PRINTING OFFICE
                            WASHINGTON : 2004



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[[Page iii]]

                          Table of Contents



                                                                    Page
  Explanation.................................................       v

  Title 34:
          Subtitle B--Regulations of the Offices of the 
          Department of Education (Continued)                        1
          Chapter III--Office of Special Education and 
          Rehabilitative Services, Department of Education           5
  Findings Aids:
      Table of CFR Titles and Chapters........................     461
      Alphabetical List of Agencies Appearing in the CFR......     479
      List of CFR Sections Affected...........................     489


[[Page iv]]

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

                     Cite this Code: CFR
                     To cite the regulations in 
                       this volume use title, 
                       part and section number. 
                       Thus,  34 CFR 300.1 refers 
                       to title 34, part 300, 
                       section 1.

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


[[Page v]]

                               EXPLANATION

    The Code of Federal Regulations is a codification of the general and 
permanent rules published in the Federal Register by the Executive 
departments and agencies of the Federal Government. The Code is divided 
into 50 titles which represent broad areas subject to Federal 
regulation. Each title is divided into chapters which usually bear the 
name of the issuing agency. Each chapter is further subdivided into 
parts covering specific regulatory areas.
    Each volume of the Code is revised at least once each calendar year 
and issued on a quarterly basis approximately as follows:

Title 1 through Title 16.................................as of January 1
Title 17 through Title 27..................................as of April 1
Title 28 through Title 41...................................as of July 1
Title 42 through Title 50................................as of October 1

    The appropriate revision date is printed on the cover of each 
volume.

LEGAL STATUS

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HOW TO USE THE CODE OF FEDERAL REGULATIONS

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EFFECTIVE AND EXPIRATION DATES

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OMB CONTROL NUMBERS

    The Paperwork Reduction Act of 1980 (Pub. L. 96-511) requires 
Federal agencies to display an OMB control number with their information 
collection request. 

[[Page vi]]

Many agencies have begun publishing numerous OMB 
control numbers as amendments to existing regulations in the CFR. These 
OMB numbers are placed as close as possible to the applicable 
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OBSOLETE PROVISIONS

    Provisions that become obsolete before the revision date stated on 
the cover of each volume are not carried. Code users may find the text 
of provisions in effect on a given date in the past by using the 
appropriate numerical list of sections affected. For the period before 
January 1, 2001, consult either the List of CFR Sections Affected, 1949-
1963, 1964-1972, 1973-1985, or 1986-2000, published in 11 separate 
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CFR INDEXES AND TABULAR GUIDES

    A subject index to the Code of Federal Regulations is contained in a 
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    The Federal Register Index is issued monthly in cumulative form. 
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the revision dates of the 50 CFR titles.

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in the Code of Federal Regulations.

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mail, gpoaccess@gpo.gov.

[[Page vii]]

    The Office of the Federal Register also offers a free service on the 
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                              Raymond A. Mosley,
                                    Director,
                          Office of the Federal Register.

July 1, 2004.


[[Page ix]]

                               THIS TITLE

    Title 34--Education is presently composed of three volumes (parts 1 
to 299, parts 300 to 399, and part 400 to End). The contents of these 
volumes represent all regulations codified under this title of the CFR 
as of July 1, 2004.

    A redesignation table appears in the Finding Aids section of the 
last volume.

    For this volume, Elmer Barksdale was Chief Editor. The Code of 
Federal Regulations publication program is under the direction of 
Frances D. McDonald, assisted by Alomha S. Morris.

[[Page x]]




[[Page 1]]



                           TITLE 34--EDUCATION




                  (This book contains parts 300 to 399)

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

 SUBTITLE B--Regulations of the Offices of the Department of Education 
                                (Continued)

                                                                    Part

chapter III--Office of Special Education and Rehabilitative 
  Services, Department of Education.........................         300

[[Page 3]]

 Subtitle B--Regulations of the Offices of the Department of Education 
                               (Continued)

[[Page 5]]



              CHAPTER III--OFFICE OF SPECIAL EDUCATION AND






            REHABILITATIVE SERVICES, DEPARTMENT OF EDUCATION




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

Part                                                                Page
300             Assistance to states for the education of 
                    children with disabilities..............           7
301             Preschool grants for children with 
                    disabilities............................         171
303             Early intervention program for infants and 
                    toddlers with disabilities..............         175
304             Special Education--Personnel preparation to 
                    improve services and results for 
                    children with disabilities..............         216
350             Disability and rehabilitation research 
                    projects and centers program............         221
356             Disability and rehabilitation research: 
                    Research fellowships....................         236
359             Disability and rehabilitation research: 
                    Special projects and demonstrations for 
                    spinal cord injuries....................         239
361             The State vocational rehabilitation services 
                    program.................................         242
363             The State supported employment services 
                    program.................................         307
364             State independent living services program 
                    and centers for independent living 
                    program: General provisions.............         313
365             State independent living services...........         332
366             Centers for independent living..............         336
367             Independent living services for older 
                    individuals who are blind...............         356
369             Vocational rehabilitation service projects..         362
370             Client assistance program...................         369
371             Vocational rehabilitation service projects 
                    for American Indians with disabilities..         380
373             Special demonstration programs..............         384

[[Page 6]]

376             Special projects and demonstrations for 
                    providing transitional rehabilitation 
                    services to youth with disabilities.....         390
377             Demonstration projects to increase client 
                    choice program..........................         392
379             Projects with industry......................         398
380             Special projects and demonstrations for 
                    providing supported employment services 
                    to individuals with the most severe 
                    disabilities and technical assistance 
                    projects................................         408
381             Protection and advocacy of individual rights         413
385             Rehabilitation training.....................         418
386             Rehabilitation training: Rehabilitation 
                    long-term training......................         425
387             Experimental and innovative training........         432
388             State vocational rehabilitation unit in-
                    service training........................         433
389             Rehabilitation continuing education programs         436
390             Rehabilitation short-term training..........         438
395             Vending facility program for the blind on 
                    Federal and other property..............         440
396             Training of interpreters for individuals who 
                    are deaf and individuals who are deaf-
                    blind...................................         455
397-399

[Reserved]

[[Page 7]]



PART 300_ASSISTANCE TO STATES FOR THE EDUCATION OF CHILDREN WITH 
DISABILITIES--Table of Contents




                            Subpart A_General

   Purposes, Applicability, and Regulations That Apply to This Program

Sec.
300.1 Purposes.
300.2 Applicability of this part to State, local, and private agencies.
300.3 Regulations that apply.

                      Definitions Used in This Part

300.4 Act.
300.5 Assistive technology device.
300.6 Assistive technology service.
300.7 Child with a disability.
300.8 Consent.
300.9 Day; business day; school day.
300.10 Educational service agency.
300.11 Equipment.
300.12 Evaluation.
300.13 Free appropriate public education.
300.14 Include.
300.15 Individualized education program.
300.16 Individualized education program team.
300.17 Individualized family service plan.
300.18 Local educational agency.
300.19 Native language.
300.20 Parent.
300.21 Personally identifiable.
300.22 Public agency.
300.23 Qualified personnel.
300.24 Related services.
300.25 Secondary school.
300.26 Special education.
300.27 State.
300.28 Supplementary aids and services.
300.29 Transition services.
300.30 Definitions in EDGAR.

                  Subpart B_State and Local Eligibility

                       State Eligibility--General

300.110 Condition of assistance.
300.111 Exception for prior State policies and procedures on file with 
          the Secretary.
300.112 Amendments to State policies and procedures.
300.113 Approval by the Secretary.
300.114-300.120 [Reserved]

                 State Eligibility--Specific Conditions

300.121 Free appropriate public education (FAPE).
300.122 Exception to FAPE for certain ages.
300.123 Full educational opportunity goal (FEOG).
300.124 FEOG--timetable.
300.125 Child find.
300.126 Procedures for evaluation and determination of eligibility.
300.127 Confidentiality of personally identifiable information.
300.128 Individualized education programs.
300.129 Procedural safeguards.
300.130 Least restrictive environment.
300.131 [Reserved]
300.132 Transition of children from Part C to preschool programs.
300.133 Children in private schools.
300.134 [Reserved]
300.135 Comprehensive system of personnel development.
300.136 Personnel standards.
300.137 Performance goals and indicators.
300.138 Participation in assessments.
300.139 Reports relating to assessments.
300.140 [Reserved]
300.141 SEA responsibility for general supervision.
300.142 Methods of ensuring services.
300.143 SEA implementation of procedural safeguards.
300.144 Hearings relating to LEA eligibility.
300.145 Recovery of funds for misclassified children.
300.146 Suspension and expulsion rates.
300.147 Additional information if SEA provides direct services.
300.148 Public participation.
300.149 [Reserved]
300.150 State advisory panel.
300.151 [Reserved]
300.152 Prohibition against commingling.
300.153 State-level nonsupplanting.
300.154 Maintenance of State financial support.
300.155 Policies and procedures for use of Part B funds.
300.156 Annual description of use of Part B funds.

                LEA and State Agency Eligibility--General

300.180 Condition of assistance.
300.181 Exception for prior LEA or State agency policies and procedures 
          on file with the SEA.
300.182 Amendments to LEA policies and procedures.
300.183 [Reserved]
300.184 Excess cost requirement.
300.185 Meeting the excess cost requirement.
300.186-300.189 [Reserved]
300.190 Joint establishment of eligibility.
300.191 [Reserved]
300.192 Requirements for establishing eligibility.
300.193 [Reserved]
300.194 State agency eligibility.
300.195 [Reserved]
300.196 Notification of LEA or State agency in case of ineligibility.
300.197 LEA and State agency compliance.

[[Page 8]]

          LEA and State Agency Eligibility--Specific Conditions

300.220 Consistency with State policies.
300.221 Implementation of CSPD.
300.222-300.229 [Reserved]
300.230 Use of amounts.
300.231 Maintenance of effort.
300.232 Exception to maintenance of effort.
300.233 Treatment of Federal funds in certain fiscal years.
300.234 Schoolwide programs under title I of the ESEA.
300.235 Permissive use of funds.
300.236-300.239 [Reserved]
300.240 Information for SEA.
300.241 Treatment of charter schools and their students.
300.242 Public information.
300.243 [Reserved]
300.244 Coordinated services system.

                      School-Based Improvement Plan

300.245 School-based improvement plan.
300.246 Plan requirements.
300.247 Responsibilities of the LEA.
300.248 Limitation.
300.249 Additional requirements.
300.250 Extension of plan.

                 Secretary of the Interior--Eligibility

300.260 Submission of information.
300.261 Public participation.
300.262 Use of Part B funds.
300.263 Plan for coordination of services.
300.264 Definitions.
300.265 Establishment of advisory board.
300.266 Annual report by advisory board.
300.267 Applicable regulations.

                          Public Participation

300.280 Public hearings before adopting State policies and procedures.
300.281 Notice.
300.282 Opportunity to participate; comment period.
300.283 Review of public comments before adopting policies and 
          procedures.
300.284 Publication and availability of approved policies and 
          procedures.

                           Subpart C_Services

                    Free Appropriate Public Education

300.300 Provision of FAPE.
300.301 FAPE--methods and payments.
300.302 Residential placement.
300.303 Proper functioning of hearing aids.
300.304 Full educational opportunity goal.
300.305 Program options.
300.306 Nonacademic services.
300.307 Physical education.
300.308 Assistive technology.
300.309 Extended school year services.
300.310 [Reserved]
300.311 FAPE requirements for students with disabilities in adult 
          prisons.
300.312 Children with disabilities in public charter schools.
300.313 Children experiencing developmental delays.

                      Evaluations and Reevaluations

300.320 Initial evaluations.
300.321 Reevaluations.
300.322-300.324 [Reserved]

                    Individualized Education Programs

300.340 Definitions related to IEPs.
300.341 Responsibility of SEA and other public agencies for IEPs.
300.342 When IEPs must be in effect.
300.343 IEP meetings.
300.344 IEP team.
300.345 Parent participation.
300.346 Development, review, and revision of IEP.
300.347 Content of IEP.
300.348 Agency responsibilities for transition services.
300.349 Private school placements by public agencies.
300.350 IEPs--accountability.

                       Direct Services by the Sea

300.360 Use of LEA allocation for direct services.
300.361 Nature and location of services.
300.362-300.369 [Reserved]
300.370 Use of SEA allocations.
300.371 [Reserved]
300.372 Nonapplicability of requirements that prohibit commingling and 
          supplanting of funds.

          Comprehensive System of Personnel Development (CSPD)

300.380 General CSPD requirements.
300.381 Adequate supply of qualified personnel.
300.382 Improvement strategies.
300.383-300.387 [Reserved]

                  Subpart D_Children in Private Schools

  Children With Disabilities in Private Schools Placed or Referred by 
                             Public Agencies

300.400 Applicability of Sec. Sec. 300.400-300.402.
300.401 Responsibility of State educational agency.
300.402 Implementation by State educational agency.

Children With Disabilities Enrolled by Their Parents in Private Schools 
                          When FAPE is at Issue

300.403 Placement of children by parents if FAPE is at issue.

[[Page 9]]

 Children With Disabilities Enrolled by Their Parents in Private Schools

300.450 Definition of ``private school children with disabilities.''
300.451 Child find for private school children with disabilities.
300.452 Provision of services--basic requirement.
300.453 Expenditures.
300.454 Services determined.
300.455 Services provided.
300.456 Location of services; transportation.
300.457 Complaints.
300.458 Separate classes prohibited.
300.459 Requirement that funds not benefit a private school.
300.460 Use of public school personnel.
300.461 Use of private school personnel.
300.462 Requirements concerning property, equipment, and supplies for 
          the benefit of private school children with disabilities.

                         Procedures for By-Pass

300.480 By-pass--general.
300.481 Provisions for services under a by-pass.
300.482 Notice of intent to implement a by-pass.
300.483 Request to show cause.
300.484 Show cause hearing.
300.485 Decision.
300.486 Filing requirements.
300.487 Judicial review.

                     Subpart E_Procedural Safeguards

             Due Process Procedures for Parents and Children

300.500 General responsibility of public agencies; definitions.
300.501 Opportunity to examine records; parent participation in 
          meetings.
300.502 Independent educational evaluation.
300.503 Prior notice by the public agency; content of notice.
300.504 Procedural safeguards notice.
300.505 Parental consent.
300.506 Mediation.
300.507 Impartial due process hearing; parent notice.
300.508 Impartial hearing officer.
300.509 Hearing rights.
300.510 Finality of decision; appeal; impartial review.
300.511 Timelines and convenience of hearings and reviews.
300.512 Civil action.
300.513 Attorneys' fees.
300.514 Child's status during proceedings.
300.515 Surrogate parents.
300.516 [Reserved]
300.517 Transfer of parental rights at age of majority.

                          Discipline Procedures

300.519 Change of placement for disciplinary removals.
300.520 Authority of school personnel.
300.521 Authority of hearing officer.
300.522 Determination of setting.
300.523 Manifestation determination review.
300.524 Determination that behavior was not manifestation of disability.
300.525 Parent appeal.
300.526 Placement during appeals.
300.527 Protections for children not yet eligible for special education 
          and related services.
300.528 Expedited due process hearings.
300.529 Referral to and action by law enforcement and judicial 
          authorities.

       Procedures for Evaluation and Determination of Eligibility

300.530 General.
300.531 Initial evaluation.
300.532 Evaluation procedures.
300.533 Determination of needed evaluation data.
300.534 Determination of eligibility.
300.535 Procedures for determining eligibility and placement.
300.536 Reevaluation.

  Additional Procedures for Evaluating Children With Specific Learning 
                              Disabilities

300.540 Additional team members.
300.541 Criteria for determining the existence of a specific learning 
          disability.
300.542 Observation.
300.543 Written report.

                   Least Restrictive Environment (LRE)

300.550 General LRE requirements.
300.551 Continuum of alternative placements.
300.552 Placements.
300.553 Nonacademic settings.
300.554 Children in public or private institutions.
300.555 Technical assistance and training activities.
300.556 Monitoring activities.

                     Confidentiality of Information

300.560 Definitions.
300.561 Notice to parents.
300.562 Access rights.
300.563 Record of access.
300.564 Records on more than one child.
300.565 List of types and locations of information.
300.566 Fees.
300.567 Amendment of records at parent's request.
300.568 Opportunity for a hearing.
300.569 Result of hearing.
300.570 Hearing procedures.

[[Page 10]]

300.571 Consent.
300.572 Safeguards.
300.573 Destruction of information.
300.574 Children's rights.
300.575 Enforcement.
300.576 Disciplinary information.
300.577 Department use of personally identifiable information.

                          Department Procedures

300.580 Determination by the Secretary that a State is eligible.
300.581 Notice and hearing before determining that a State is not 
          eligible.
300.582 Hearing official or panel.
300.583 Hearing procedures.
300.584 Initial decision; final decision.
300.585 Filing requirements.
300.586 Judicial review.
300.587 Enforcement.
300.588 [Reserved]
300.589 Waiver of requirement regarding supplementing and not 
          supplanting with Part B funds.

                     Subpart F_State Administration

                                 General

300.600 Responsibility for all educational programs.
300.601 Relation of Part B to other Federal programs.
300.602 State-level activities.

                              Use of Funds

300.620 Use of funds for State administration.
300.621 Allowable costs.
300.622 Subgrants to LEAs for capacity-building and improvement.
300.623 Amount required for subgrants to LEAs.
300.624 State discretion in awarding subgrants.

                          State Advisory Panel

300.650 Establishment of advisory panels.
300.651 Membership.
300.652 Advisory panel functions.
300.653 Advisory panel procedures.

                       State Complaint Procedures

300.660 Adoption of State complaint procedures.
300.661 Minimum State complaint procedures.
300.662 Filing a complaint.

                 Subpart G_Allocation of Funds; Reports

                               Allocations

300.700 Special definition of the term ``State.''
300.701 Grants to States.
300.702 Definition.
300.703 Allocations to States.
300.704-300.705 [Reserved]
300.706 Permanent formula.
300.707 Increase in funds.
300.708 Limitation.
300.709 Decrease in funds.
300.710 Allocation for State in which by-pass is implemented for private 
          school children with disabilities.
300.711 Subgrants to LEAs.
300.712 Allocations to LEAs.
300.713 Former Chapter 1 State agencies.
300.714 Reallocation of LEA funds.
300.715 Payments to the Secretary of the Interior for the education of 
          Indian children.
300.716 Payments for education and services for Indian children with 
          disabilities aged 3 through 5.
300.717 Outlying areas and freely associated States.
300.718 Outlying area--definition.
300.719 Limitation for freely associated States.
300.720 Special rule.
300.721 [Reserved]
300.722 Definition.

                                 Reports

300.750 Annual report of children served--report requirement.
300.751 Annual report of children served--information required in the 
          report.
300.752 Annual report of children served--certification.
300.753 Annual report of children served--criteria for counting 
          children.
300.754 Annual report of children served--other responsibilities of the 
          SEA.
300.755 Disproportionality.
300.756 Acquisition of equipment; construction or alteration of 
          facilities.

Appendix A to Part 300--Notice of Interpretation
Appendix B to Part 300--Index for IDEA--Part B Regulations
Appendix C to Part 300--Implementation of the 20 Percent Rule Under 
          Sec. 300.233

    Authority: 20 U.S.C. 1411-1420, unless otherwise noted.

    Source: 64 FR 12418, Mar. 12, 1999, unless otherwise noted.



                            Subpart A_General

   Purposes, Applicability, and Regulations That Apply to This Program



Sec. 300.1  Purposes.

    The purposes of this part are--
    (a) To ensure that all children with disabilities have available to 
them a free appropriate public education that

[[Page 11]]

emphasizes special education and related services designed to meet their 
unique needs and prepare them for employment and independent living;
    (b) To ensure that the rights of children with disabilities and 
their parents are protected;
    (c) To assist States, localities, educational service agencies, and 
Federal agencies to provide for the education of all children with 
disabilities; and
    (d) To assess and ensure the effectiveness of efforts to educate 
children with disabilities.

(Authority: 20 U.S.C. 1400 note)



Sec. 300.2  Applicability of this part to State, local, and private agencies.

    (a) States. This part applies to each State that receives payments 
under Part B of the Act.
    (b) Public agencies within the State. The provisions of this part--
    (1) Apply to all political subdivisions of the State that are 
involved in the education of children with disabilities, including--
    (i) The State educational agency (SEA);
    (ii) Local educational agencies (LEAs), educational service agencies 
(ESAs), and public charter schools that are not otherwise included as 
LEAs or ESAs and are not a school of an LEA or ESA;
    (iii) Other State agencies and schools (such as Departments of 
Mental Health and Welfare and State schools for children with deafness 
or children with blindness); and
    (iv) State and local juvenile and adult correctional facilities; and
    (2) Are binding on each public agency in the State that provides 
special education and related services to children with disabilities, 
regardless of whether that agency is receiving funds under Part B.
    (c) Private schools and facilities. Each public agency in the State 
is responsible for ensuring that the rights and protections under Part B 
of the Act are given to children with disabilities--
    (1) Referred to or placed in private schools and facilities by that 
public agency; or
    (2) Placed in private schools by their parents under the provisions 
of Sec. 300.403(c).

(Authority: 20 U.S.C. 1412)



Sec. 300.3  Regulations that apply.

    The following regulations apply to this program:
    (a) 34 CFR part 76 (State-Administered Programs) except for 
Sec. Sec. 76.125-76.137 and 76.650-76.662.
    (b) 34 CFR part 77 (Definitions).
    (c) 34 CFR part 79 (Intergovernmental Review of Department of 
Education Programs and Activities).
    (d) 34 CFR part 80 (Uniform Administrative Requirements for Grants 
and Cooperative Agreements to State and Local Governments).
    (e) 34 CFR part 81 (General Education Provisions Act--Enforcement).
    (f) 34 CFR part 82 (New Restrictions on Lobbying).
    (g) 34 CFR part 85 (Government-wide Debarment and Suspension 
(Nonprocurement) and Government-wide Requirements for Drug-Free 
Workplace (Grants)).
    (h) The regulations in this part--34 CFR part 300 (Assistance for 
Education of Children with Disabilities).

(Authority: 20 U.S.C. 1221e-3(a)(1))

                      Definitions Used in This Part



Sec. 300.4  Act.

    As used in this part, Act means the Individuals with Disabilities 
Education Act (IDEA), as amended.

(Authority: 20 U.S.C. 1400(a))



Sec. 300.5  Assistive technology device.

    As used in this part, Assistive technology device means any item, 
piece of equipment, or product system, whether acquired commercially off 
the shelf, modified, or customized, that is used to increase, maintain, 
or improve the functional capabilities of a child with a disability.

(Authority: 20 U.S.C. 1401(1))



Sec. 300.6  Assistive technology service.

    As used in this part, Assistive technology service means any service 
that

[[Page 12]]

directly assists a child with a disability in the selection, 
acquisition, or use of an assistive technology device.
    The term includes--
    (a) The evaluation of the needs of a child with a disability, 
including a functional evaluation of the child in the child's customary 
environment;
    (b) Purchasing, leasing, or otherwise providing for the acquisition 
of assistive technology devices by children with disabilities;
    (c) Selecting, designing, fitting, customizing, adapting, applying, 
maintaining, repairing, or replacing assistive technology devices;
    (d) Coordinating and using other therapies, interventions, or 
services with assistive technology devices, such as those associated 
with existing education and rehabilitation plans and programs;
    (e) Training or technical assistance for a child with a disability 
or, if appropriate, that child's family; and
    (f) Training or technical assistance for professionals (including 
individuals providing education or rehabilitation services), employers, 
or other individuals who provide services to, employ, or are otherwise 
substantially involved in the major life functions of that child.

(Authority: 20 U.S.C. 1401(2))



Sec. 300.7  Child with a disability.

    (a) General. (1) As used in this part, the term child with a 
disability means a child evaluated in accordance with Sec. Sec. 
300.530-300.536 as having mental retardation, a hearing impairment 
including deafness, a speech or language impairment, a visual impairment 
including blindness, serious emotional disturbance (hereafter referred 
to as emotional disturbance), an orthopedic impairment, autism, 
traumatic brain injury, an other health impairment, a specific learning 
disability, deaf-blindness, or multiple disabilities, and who, by reason 
thereof, needs special education and related services.
    (2)(i) Subject to paragraph (a)(2)(ii) of this section, if it is 
determined, through an appropriate evaluation under Sec. Sec. 300.530-
300.536, that a child has one of the disabilities identified in 
paragraph (a)(1) of this section, but only needs a related service and 
not special education, the child is not a child with a disability under 
this part.
    (ii) If, consistent with Sec. 300.26(a)(2), the related service 
required by the child is considered special education rather than a 
related service under State standards, the child would be determined to 
be a child with a disability under paragraph (a)(1) of this section.
    (b) Children aged 3 through 9 experiencing developmental delays. The 
term child with a disability for children aged 3 through 9 may, at the 
discretion of the State and LEA and in accordance with Sec. 300.313, 
include a child--
    (1) Who is experiencing developmental delays, as defined by the 
State and as measured by appropriate diagnostic instruments and 
procedures, in one or more of the following areas: physical development, 
cognitive development, communication development, social or emotional 
development, or adaptive development; and
    (2) Who, by reason thereof, needs special education and related 
services.
    (c) Definitions of disability terms. The terms used in this 
definition are defined as follows:
    (1)(i) Autism means a developmental disability significantly 
affecting verbal and nonverbal communication and social interaction, 
generally evident before age 3, that adversely affects a child's 
educational performance. Other characteristics often associated with 
autism are engagement in repetitive activities and stereotyped 
movements, resistance to environmental change or change in daily 
routines, and unusual responses to sensory experiences. The term does 
not apply if a child's educational performance is adversely affected 
primarily because the child has an emotional disturbance, as defined in 
paragraph (b)(4) of this section.
    (ii) A child who manifests the characteristics of ``autism'' after 
age 3 could be diagnosed as having ``autism'' if the criteria in 
paragraph (c)(1)(i) of this section are satisfied.
    (2) Deaf-blindness means concomitant hearing and visual impairments, 
the combination of which causes such severe communication and other 
developmental and educational needs that

[[Page 13]]

they cannot be accommodated in special education programs solely for 
children with deafness or children with blindness.
    (3) Deafness means a hearing impairment that is so severe that the 
child is impaired in processing linguistic information through hearing, 
with or without amplification, that adversely affects a child's 
educational performance.
    (4) Emotional disturbance is defined as follows:
    (i) The term means a condition exhibiting one or more of the 
following characteristics over a long period of time and to a marked 
degree that adversely affects a child's educational performance:
    (A) An inability to learn that cannot be explained by intellectual, 
sensory, or health factors.
    (B) An inability to build or maintain satisfactory interpersonal 
relationships with peers and teachers.
    (C) Inappropriate types of behavior or feelings under normal 
circumstances.
    (D) A general pervasive mood of unhappiness or depression.
    (E) A tendency to develop physical symptoms or fears associated with 
personal or school problems.
    (ii) The term includes schizophrenia. The term does not apply to 
children who are socially maladjusted, unless it is determined that they 
have an emotional disturbance.
    (5) Hearing impairment means an impairment in hearing, whether 
permanent or fluctuating, that adversely affects a child's educational 
performance but that is not included under the definition of deafness in 
this section.
    (6) Mental retardation means significantly subaverage general 
intellectual functioning, existing concurrently with deficits in 
adaptive behavior and manifested during the developmental period, that 
adversely affects a child's educational performance.
    (7) Multiple disabilities means concomitant impairments (such as 
mental retardation-blindness, mental retardation-orthopedic impairment, 
etc.), the combination of which causes such severe educational needs 
that they cannot be accommodated in special education programs solely 
for one of the impairments. The term does not include deaf-blindness.
    (8) Orthopedic impairment means a severe orthopedic impairment that 
adversely affects a child's educational performance. The term includes 
impairments caused by congenital anomaly (e.g., clubfoot, absence of 
some member, etc.), impairments caused by disease (e.g., poliomyelitis, 
bone tuberculosis, etc.), and impairments from other causes (e.g., 
cerebral palsy, amputations, and fractures or burns that cause 
contractures).
    (9) Other health impairment means having limited strength, vitality 
or alertness, including a heightened alertness to environmental stimuli, 
that results in limited alertness with respect to the educational 
environment, that--
    (i) Is due to chronic or acute health problems such as asthma, 
attention deficit disorder or attention deficit hyperactivity disorder, 
diabetes, epilepsy, a heart condition, hemophilia, lead poisoning, 
leukemia, nephritis, rheumatic fever, and sickle cell anemia; and
    (ii) Adversely affects a child's educational performance.
    (10) Specific learning disability is defined as follows:
    (i) General. The term means a disorder in one or more of the basic 
psychological processes involved in understanding or in using language, 
spoken or written, that may manifest itself in an imperfect ability to 
listen, think, speak, read, write, spell, or to do mathematical 
calculations, including conditions such as perceptual disabilities, 
brain injury, minimal brain dysfunction, dyslexia, and developmental 
aphasia.
    (ii) Disorders not included. The term does not include learning 
problems that are primarily the result of visual, hearing, or motor 
disabilities, of mental retardation, of emotional disturbance, or of 
environmental, cultural, or economic disadvantage.
    (11) Speech or language impairment means a communication disorder, 
such as stuttering, impaired articulation, a language impairment, or a 
voice impairment, that adversely affects a child's educational 
performance.
    (12) Traumatic brain injury means an acquired injury to the brain 
caused by an external physical force, resulting in

[[Page 14]]

total or partial functional disability or psychosocial impairment, or 
both, that adversely affects a child's educational performance. The term 
applies to open or closed head injuries resulting in impairments in one 
or more areas, such as cognition; language; memory; attention; 
reasoning; abstract thinking; judgment; problem-solving; sensory, 
perceptual, and motor abilities; psychosocial behavior; physical 
functions; information processing; and speech. The term does not apply 
to brain injuries that are congenital or degenerative, or to brain 
injuries induced by birth trauma.
    (13) Visual impairment including blindness means an impairment in 
vision that, even with correction, adversely affects a child's 
educational performance. The term includes both partial sight and 
blindness.

(Authority: 20 U.S.C. 1401(3)(A) and (B); 1401(26))



Sec. 300.8  Consent.

    As used in this part, the term consent has the meaning given that 
term in Sec. 300.500(b)(1).

(Authority: 20 U.S.C. 1415(a))



Sec. 300.9  Day; business day; school day.

    As used in this part, the term--
    (a) Day means calendar day unless otherwise indicated as business 
day or school day;
    (b) Business day means Monday through Friday, except for Federal and 
State holidays (unless holidays are specifically included in the 
designation of business day, as in Sec. 300.403(d)(1)(ii)); and
    (c)(1) School day means any day, including a partial day, that 
children are in attendance at school for instructional purposes.
    (2) The term school day has the same meaning for all children in 
school, including children with and without disabilities.

(Authority: 20 U.S.C. 1221e-3)



Sec. 300.10  Educational service agency.

    As used in this part, the term educational service agency--
    (a) Means a regional public multiservice agency--
    (1) Authorized by State law to develop, manage, and provide services 
or programs to LEAs; and
    (2) Recognized as an administrative agency for purposes of the 
provision of special education and related services provided within 
public elementary and secondary schools of the State;
    (b) Includes any other public institution or agency having 
administrative control and direction over a public elementary or 
secondary school; and
    (c) Includes entities that meet the definition of intermediate 
educational unit in section 602(23) of IDEA as in effect prior to June 
4, 1997.

(Authority: 20 U.S.C. 1401(4))



Sec. 300.11  Equipment.

    As used in this part, the term equipment means--
    (a) Machinery, utilities, and built-in equipment and any necessary 
enclosures or structures to house the machinery, utilities, or 
equipment; and
    (b) All other items necessary for the functioning of a particular 
facility as a facility for the provision of educational services, 
including items such as instructional equipment and necessary furniture; 
printed, published and audio-visual instructional materials; 
telecommunications, sensory, and other technological aids and devices; 
and books, periodicals, documents, and other related materials.

(Authority: 20 U.S.C. 1401(6))



Sec. 300.12  Evaluation.

    As used in this part, the term evaluation has the meaning given that 
term in Sec. 300.500(b)(2).

(Authority: 20 U.S.C. 1415(a))



Sec. 300.13  Free appropriate public education.

    As used in this part, the term free appropriate public education or 
FAPE means special education and related services that--
    (a) Are provided at public expense, under public supervision and 
direction, and without charge;
    (b) Meet the standards of the SEA, including the requirements of 
this part;

[[Page 15]]

    (c) Include preschool, elementary school, or secondary school 
education in the State; and
    (d) Are provided in conformity with an individualized education 
program (IEP) that meets the requirements of Sec. Sec. 300.340-300.350.

(Authority: 20 U.S.C. 1401(8))



Sec. 300.14  Include.

    As used in this part, the term include means that the items named 
are not all of the possible items that are covered, whether like or 
unlike the ones named.

(Authority: 20 U.S.C. 1221e-3)



Sec. 300.15  Individualized education program.

    As used in this part, the term individualized education program or 
IEP has the meaning given the term in Sec. 300.340(a).

(Authority: 20 U.S.C. 1401(11))



Sec. 300.16  Individualized education program team.

    As used in this part, the term individualized education program team 
or IEP team means a group of individuals described in Sec. 300.344 that 
is responsible for developing, reviewing, or revising an IEP for a child 
with a disability.

(Authority: 20 U.S.C. 1221e-3)



Sec. 300.17  Individualized family service plan.

    As used in this part, the term individualized family service plan or 
IFSP has the meaning given the term in 34 CFR 303.340(b).

(Authority: 20 U.S.C. 1401(12))



Sec. 300.18  Local educational agency.

    (a) As used in this part, the term local educational agency means a 
public board of education or other public authority legally constituted 
within a State for either administrative control or direction of, or to 
perform a service function for, public elementary or secondary schools 
in a city, county, township, school district, or other political 
subdivision of a State, or for a combination of school districts or 
counties as are recognized in a State as an administrative agency for 
its public elementary or secondary schools.
    (b) The term includes--
    (1) An educational service agency, as defined in Sec. 300.10;
    (2) Any other public institution or agency having administrative 
control and direction of a public elementary or secondary school, 
including a public charter school that is established as an LEA under 
State law; and
    (3) An elementary or secondary school funded by the Bureau of Indian 
Affairs, and not subject to the jurisdiction of any SEA other than the 
Bureau of Indian Affairs, but only to the extent that the inclusion 
makes the school eligible for programs for which specific eligibility is 
not provided to the school in another provision of law and the school 
does not have a student population that is smaller than the student 
population of the LEA receiving assistance under this Act with the 
smallest student population.

(Authority: 20 U.S.C. 1401(15))



Sec. 300.19  Native language.

    (a) As used in this part, the term native language, if used with 
reference to an individual of limited English proficiency, means the 
following:
    (1) The language normally used by that individual, or, in the case 
of a child, the language normally used by the parents of the child, 
except as provided in paragraph (a)(2) of this section.
    (2) In all direct contact with a child (including evaluation of the 
child), the language normally used by the child in the home or learning 
environment.
    (b) For an individual with deafness or blindness, or for an 
individual with no written language, the mode of communication is that 
normally used by the individual (such as sign language, braille, or oral 
communication).

(Authority: 20 U.S.C. 1401(16))



Sec. 300.20  Parent.

    (a) General. As used in this part, the term parent means--
    (1) A natural or adoptive parent of a child;
    (2) A guardian but not the State if the child is a ward of the 
State;
    (3) A person acting in the place of a parent (such as a grandparent 
or stepparent with whom the child lives, or a

[[Page 16]]

person who is legally responsible for the child's welfare); or
    (4) A surrogate parent who has been appointed in accordance with 
Sec. 300.515.
    (b) Foster parent. Unless State law prohibits a foster parent from 
acting as a parent, a State may allow a foster parent to act as a parent 
under Part B of the Act if--
    (1) The natural parents' authority to make educational decisions on 
the child's behalf has been extinguished under State law; and
    (2) The foster parent--
    (i) Has an ongoing, long-term parental relationship with the child;
    (ii) Is willing to make the educational decisions required of 
parents under the Act; and
    (iii) Has no interest that would conflict with the interests of the 
child.

(Authority: 20 U.S.C. 1401(19))



Sec. 300.21  Personally identifiable

    As used in this part, the term personally identifiable has the 
meaning given that term in Sec. 300.500(b)(3).

(Authority: 20 U.S.C. 1415(a))



Sec. 300.22  Public agency.

    As used in this part, the term public agency includes the SEA, LEAs, 
ESAs, public charter schools that are not otherwise included as LEAs or 
ESAs and are not a school of an LEA or ESA, and any other political 
subdivisions of the State that are responsible for providing education 
to children with disabilities.

(Authority: 20 U.S.C. 1412(a)(1)(A), (a)(11))



Sec. 300.23  Qualified personnel.

    As used in this part, the term qualified personnel means personnel 
who have met SEA-approved or SEA-recognized certification, licensing, 
registration, or other comparable requirements that apply to the area in 
which the individuals are providing special education or related 
services.

(Authority: 20 U.S.C. 1221e-3)



Sec. 300.24  Related services.

    (a) General. As used in this part, the term related services means 
transportation and such developmental, corrective, and other supportive 
services as are required to assist a child with a disability to benefit 
from special education, and includes speech-language pathology and 
audiology services, psychological services, physical and occupational 
therapy, recreation, including therapeutic recreation, early 
identification and assessment of disabilities in children, counseling 
services, including rehabilitation counseling, orientation and mobility 
services, and medical services for diagnostic or evaluation purposes. 
The term also includes school health services, social work services in 
schools, and parent counseling and training.
    (b) Individual terms defined. The terms used in this definition are 
defined as follows:
    (1) Audiology includes--
    (i) Identification of children with hearing loss;
    (ii) Determination of the range, nature, and degree of hearing loss, 
including referral for medical or other professional attention for the 
habilitation of hearing;
    (iii) Provision of habilitative activities, such as language 
habilitation, auditory training, speech reading (lip-reading), hearing 
evaluation, and speech conservation;
    (iv) Creation and administration of programs for prevention of 
hearing loss;
    (v) Counseling and guidance of children, parents, and teachers 
regarding hearing loss; and
    (vi) Determination of children's needs for group and individual 
amplification, selecting and fitting an appropriate aid, and evaluating 
the effectiveness of amplification.
    (2) Counseling services means services provided by qualified social 
workers, psychologists, guidance counselors, or other qualified 
personnel.
    (3) Early identification and assessment of disabilities in children 
means the implementation of a formal plan for identifying a disability 
as early as possible in a child's life.
    (4) Medical services means services provided by a licensed physician 
to determine a child's medically related disability that results in the 
child's need for special education and related services.
    (5) Occupational therapy--

[[Page 17]]

    (i) Means services provided by a qualified occupational therapist; 
and
    (ii) Includes--
    (A) Improving, developing or restoring functions impaired or lost 
through illness, injury, or deprivation;
    (B) Improving ability to perform tasks for independent functioning 
if functions are impaired or lost; and
    (C) Preventing, through early intervention, initial or further 
impairment or loss of function.
    (6) Orientation and mobility services--
    (i) Means services provided to blind or visually impaired students 
by qualified personnel to enable those students to attain systematic 
orientation to and safe movement within their environments in school, 
home, and community; and
    (ii) Includes teaching students the following, as appropriate:
    (A) Spatial and environmental concepts and use of information 
received by the senses (such as sound, temperature and vibrations) to 
establish, maintain, or regain orientation and line of travel (e.g., 
using sound at a traffic light to cross the street);
    (B) To use the long cane to supplement visual travel skills or as a 
tool for safely negotiating the environment for students with no 
available travel vision;
    (C) To understand and use remaining vision and distance low vision 
aids; and
    (D) Other concepts, techniques, and tools.
    (7) Parent counseling and training means--
    (i) Assisting parents in understanding the special needs of their 
child;
    (ii) Providing parents with information about child development; and
    (iii) Helping parents to acquire the necessary skills that will 
allow them to support the implementation of their child's IEP or IFSP.
    (8) Physical therapy means services provided by a qualified physical 
therapist.
    (9) Psychological services includes--
    (i) Administering psychological and educational tests, and other 
assessment procedures;
    (ii) Interpreting assessment results;
    (iii) Obtaining, integrating, and interpreting information about 
child behavior and conditions relating to learning;
    (iv) Consulting with other staff members in planning school programs 
to meet the special needs of children as indicated by psychological 
tests, interviews, and behavioral evaluations;
    (v) Planning and managing a program of psychological services, 
including psychological counseling for children and parents; and
    (vi) Assisting in developing positive behavioral intervention 
strategies.
    (10) Recreation includes--
    (i) Assessment of leisure function;
    (ii) Therapeutic recreation services;
    (iii) Recreation programs in schools and community agencies; and
    (iv) Leisure education.
    (11) Rehabilitation counseling services means services provided by 
qualified personnel in individual or group sessions that focus 
specifically on career development, employment preparation, achieving 
independence, and integration in the workplace and community of a 
student with a disability. The term also includes vocational 
rehabilitation services provided to a student with disabilities by 
vocational rehabilitation programs funded under the Rehabilitation Act 
of 1973, as amended.
    (12) School health services means services provided by a qualified 
school nurse or other qualified person.
    (13) Social work services in schools includes--
    (i) Preparing a social or developmental history on a child with a 
disability;
    (ii) Group and individual counseling with the child and family;
    (iii) Working in partnership with parents and others on those 
problems in a child's living situation (home, school, and community) 
that affect the child's adjustment in school;
    (iv) Mobilizing school and community resources to enable the child 
to learn as effectively as possible in his or her educational program; 
and
    (v) Assisting in developing positive behavioral intervention 
strategies.
    (14) Speech-language pathology services includes--
    (i) Identification of children with speech or language impairments;
    (ii) Diagnosis and appraisal of specific speech or language 
impairments;

[[Page 18]]

    (iii) Referral for medical or other professional attention necessary 
for the habilitation of speech or language impairments;
    (iv) Provision of speech and language services for the habilitation 
or prevention of communicative impairments; and
    (v) Counseling and guidance of parents, children, and teachers 
regarding speech and language impairments.
    (15) Transportation includes--
    (i) Travel to and from school and between schools;
    (ii) Travel in and around school buildings; and
    (iii) Specialized equipment (such as special or adapted buses, 
lifts, and ramps), if required to provide special transportation for a 
child with a disability.

(Authority: 20 U.S.C. 1401(22))



Sec. 300.25  Secondary school.

    As used in this part, the term secondary school means a nonprofit 
institutional day or residential school that provides secondary 
education, as determined under State law, except that it does not 
include any education beyond grade 12.

(Authority: 20 U.S.C. 1401(23))



Sec. 300.26  Special education.

    (a) General. (1) As used in this part, the term special education 
means specially designed instruction, at no cost to the parents, to meet 
the unique needs of a child with a disability, including--
    (i) Instruction conducted in the classroom, in the home, in 
hospitals and institutions, and in other settings; and
    (ii) Instruction in physical education.
    (2) The term includes each of the following, if it meets the 
requirements of paragraph (a)(1) of this section:
    (i) Speech-language pathology services, or any other related 
service, if the service is considered special education rather than a 
related service under State standards;
    (ii) Travel training; and
    (iii) Vocational education.
    (b) Individual terms defined. The terms in this definition are 
defined as follows:
    (1) At no cost means that all specially-designed instruction is 
provided without charge, but does not preclude incidental fees that are 
normally charged to nondisabled students or their parents as a part of 
the regular education program.
    (2) Physical education--
    (i) Means the development of--
    (A) Physical and motor fitness;
    (B) Fundamental motor skills and patterns; and
    (C) Skills in aquatics, dance, and individual and group games and 
sports (including intramural and lifetime sports); and
    (ii) Includes special physical education, adapted physical 
education, movement education, and motor development.
    (3) Specially-designed instruction means adapting, as appropriate to 
the needs of an eligible child under this part, the content, 
methodology, or delivery of instruction--
    (i) To address the unique needs of the child that result from the 
child's disability; and
    (ii) To ensure access of the child to the general curriculum, so 
that he or she can meet the educational standards within the 
jurisdiction of the public agency that apply to all children.
    (4) Travel training means providing instruction, as appropriate, to 
children with significant cognitive disabilities, and any other children 
with disabilities who require this instruction, to enable them to--
    (i) Develop an awareness of the environment in which they live; and
    (ii) Learn the skills necessary to move effectively and safely from 
place to place within that environment (e.g., in school, in the home, at 
work, and in the community).
    (5) Vocational education means organized educational programs that 
are directly related to the preparation of individuals for paid or 
unpaid employment, or for additional preparation for a career requiring 
other than a baccalaureate or advanced degree.

(Authority: 20 U.S.C. 1401(25))



Sec. 300.27  State.

    As used in this part, the term State means each of the 50 States, 
the District of Columbia, the Commonwealth

[[Page 19]]

of Puerto Rico, and each of the outlying areas.

(Authority: 20 U.S.C. 1401(27))



Sec. 300.28  Supplementary aids and services.

    As used in this part, the term supplementary aids and services 
means, aids, services, and other supports that are provided in regular 
education classes or other education-related settings to enable children 
with disabilities to be educated with nondisabled children to the 
maximum extent appropriate in accordance with Sec. Sec. 300.550-
300.556.

Authority: 20 U.S.C. 1401(29))



Sec. 300.29  Transition services.

    (a) As used in this part, transition services means a coordinated 
set of activities for a student with a disability that--
    (1) Is designed within an outcome-oriented process, that promotes 
movement from school to post-school activities, including postsecondary 
education, vocational training, integrated employment (including 
supported employment), continuing and adult education, adult services, 
independent living, or community participation;
    (2) Is based on the individual student's needs, taking into account 
the student's preferences and interests; and
    (3) Includes--
    (i) Instruction;
    (ii) Related services;
    (iii) Community experiences;
    (iv) The development of employment and other post-school adult 
living objectives; and
    (v) If appropriate, acquisition of daily living skills and 
functional vocational evaluation.
    (b) Transition services for students with disabilities may be 
special education, if provided as specially designed instruction, or 
related services, if required to assist a student with a disability to 
benefit from special education.

(Authority: 20 U.S.C. 1401(30))



Sec. 300.30  Definitions in EDGAR.

    The following terms used in this part are defined in 34 CFR 77.1:

Application
Award
Contract
Department
EDGAR
Elementary school
Fiscal year
Grant
Nonprofit
Project
Secretary
Subgrant
State educational agency

(Authority: 20 U.S.C. 1221e-3(a)(1))



                  Subpart B_State and Local Eligibility

                       State Eligibility--General



Sec. 300.110  Condition of assistance.

    (a) A State is eligible for assistance under Part B of the Act for a 
fiscal year if the State demonstrates to the satisfaction of the 
Secretary that the State has in effect policies and procedures to ensure 
that it meets the conditions in Sec. Sec. 300.121-300.156.
    (b) To meet the requirement of paragraph (a) of this section, the 
State must have on file with the Secretary--
    (1) The information specified in Sec. Sec. 300.121-300.156 that the 
State uses to implement the requirements of this part; and
    (2) Copies of all applicable State statutes, regulations, and other 
State documents that show the basis of that information.

(Authority: 20 U.S.C. 1412(a))



Sec. 300.111  Exception for prior State policies and procedures on file 
with the Secretary.

    If a State has on file with the Secretary policies and procedures 
approved by the Secretary that demonstrate that the State meets any 
requirement of Sec. 300.110, including any policies and procedures 
filed under Part B of the Act as in effect before June 4, 1997, the 
Secretary considers the State to have met the requirement for purposes 
of receiving a grant under Part B of the Act.

(Authority: 20 U.S.C. 1412(c)(1))

[[Page 20]]



Sec. 300.112  Amendments to State policies and procedures.

    (a) Modifications made by a State. (1) Subject to paragraph (b) of 
this section, policies and procedures submitted by a State in accordance 
with this subpart remain in effect until the State submits to the 
Secretary the modifications that the State decides are necessary.
    (2) The provisions of this subpart apply to a modification to a 
State's policies and procedures in the same manner and to the same 
extent that they apply to the State's original policies and procedures.
    (b) Modifications required by the Secretary. The Secretary may 
require a State to modify its policies and procedures, but only to the 
extent necessary to ensure the State's compliance with this part, if--
    (1) After June 4, 1997, the provisions of the Act or the regulations 
in this part are amended;
    (2) There is a new interpretation of this Act or regulations by a 
Federal court or a State's highest court; or
    (3) There is an official finding of noncompliance with Federal law 
or regulations.

(Authority: 20 U.S.C. 1412(c)(2) and (3))



Sec. 300.113  Approval by the Secretary.

    (a) General. If the Secretary determines that a State is eligible to 
receive a grant under Part B of the Act, the Secretary notifies the 
State of that determination.
    (b) Notice and hearing before determining a State is not eligible. 
The Secretary does not make a final determination that a State is not 
eligible to receive a grant under Part B of the Act until after 
providing the State reasonable notice and an opportunity for a hearing 
in accordance with the procedures in Sec. Sec. 300.581-300.586.

(Authority: 20 U.S.C. 1412(d))



Sec. Sec. 300.114-300.120  [Reserved]

                 State Eligibility--Specific Conditions



Sec. 300.121  Free appropriate public education (FAPE).

    (a) General. Each State must have on file with the Secretary 
information that shows that, subject to Sec. 300.122, the State has in 
effect a policy that ensures that all children with disabilities aged 3 
through 21 residing in the State have the right to FAPE, including 
children with disabilities who have been suspended or expelled from 
school.
    (b) Required information. The information described in paragraph (a) 
of this section must--
    (1) Include a copy of each State statute, court order, State 
Attorney General opinion, and other State documents that show the source 
of the State's policy relating to FAPE; and
    (2) Show that the policy--
    (i)(A) Applies to all public agencies in the State; and
    (B) Is consistent with the requirements of Sec. Sec. 300.300-
300.313; and
    (ii) Applies to all children with disabilities, including children 
who have been suspended or expelled from school.
    (c) FAPE for children beginning at age 3. (1) Each State shall 
ensure that--
    (i) The obligation to make FAPE available to each eligible child 
residing in the State begins no later than the child's third birthday; 
and
    (ii) An IEP or an IFSP is in effect for the child by that date, in 
accordance with Sec. 300.342(c).
    (2) If a child's third birthday occurs during the summer, the 
child's IEP team shall determine the date when services under the IEP or 
IFSP will begin.
    (d) FAPE for children suspended or expelled from school. (1) A 
public agency need not provide services during periods of removal under 
Sec. 300.520(a)(1) to a child with a disability who has been removed 
from his or her current placement for 10 school days or less in that 
school year, if services are not provided to a child without 
disabilities who has been similarly removed.
    (2) In the case of a child with a disability who has been removed 
from his

[[Page 21]]

or her current placement for more than 10 school days in that school 
year, the public agency, for the remainder of the removals, must--
    (i) Provide services to the extent necessary to enable the child to 
appropriately progress in the general curriculum and appropriately 
advance toward achieving the goals set out in the child's IEP, if the 
removal is--
    (A) Under the school personnel's authority to remove for not more 
than 10 consecutive school days as long as that removal does not 
constitute a change of placement under Sec. 300.519(b) (Sec. 
300.520((a)(1)); or
    (B) For behavior that is not a manifestation of the child's 
disability, consistent with Sec. 300.524; and
    (ii) Provide services consistent with Sec. 300.522, regarding 
determination of the appropriate interim alternative educational 
setting, if the removal is--
    (A) For drug or weapons offenses under Sec. 300.520(a)(2); or
    (B) Based on a hearing officer determination that maintaining the 
current placement of the child is substantially likely to result in 
injury to the child or to others if he or she remains in the current 
placement, consistent with Sec. 300.521.
    (3)(i) School personnel, in consultation with the child's special 
education teacher, determine the extent to which services are necessary 
to enable the child to appropriately progress in the general curriculum 
and appropriately advance toward achieving the goals set out in the 
child's IEP if the child is removed under the authority of school 
personnel to remove for not more than 10 consecutive school days as long 
as that removal does not constitute a change of placement under Sec. 
300.519 (Sec. 300.520(a)(1)).
    (ii) The child's IEP team determines the extent to which services 
are necessary to enable the child to appropriately progress in the 
general curriculum and appropriately advance toward achieving the goals 
set out in the child's IEP if the child is removed because of behavior 
that has been determined not to be a manifestation of the child's 
disability, consistent with Sec. 300.524.
    (e) Children advancing from grade to grade. (1) Each State shall 
ensure that FAPE is available to any individual child with a disability 
who needs special education and related services, even though the child 
is advancing from grade to grade.
    (2) The determination that a child described in paragraph (a)(1) of 
this section is eligible under this part, must be made on an individual 
basis by the group responsible within the child's LEA for making those 
determinations.

(Authority: 20 U.S.C. 1412(a)(1))



Sec. 300.122  Exception to FAPE for certain ages.

    (a) General. The obligation to make FAPE available to all children 
with disabilities does not apply with respect to the following:
    (1) Children aged 3, 4, 5, 18, 19, 20, or 21 in a State to the 
extent that its application to those children would be inconsistent with 
State law or practice, or the order of any court, respecting the 
provision of public education to children in one or more of those age 
groups.
    (2)(i) Students aged 18 through 21 to the extent that State law does 
not require that special education and related services under Part B of 
the Act be provided to students with disabilities who, in the last 
educational placement prior to their incarceration in an adult 
correctional facility--
    (A) Were not actually identified as being a child with a disability 
under Sec. 300.7; and
    (B) Did not have an IEP under Part B of the Act.
    (ii) The exception in paragraph (a)(2)(i) of this section does not 
apply to students with disabilities, aged 18 through 21, who--
    (A) Had been identified as a child with disability and had received 
services in accordance with an IEP, but who left school prior to their 
incarceration; or
    (B) Did not have an IEP in their last educational setting, but who 
had actually been identified as a ``child with a disability'' under 
Sec. 300.7.
    (3)(i) Students with disabilities who have graduated from high 
school with a regular high school diploma.
    (ii) The exception in paragraph (a)(3)(i) of this section does not 
apply to students who have graduated but

[[Page 22]]

have not been awarded a regular high school diploma.
    (iii) Graduation from high school with a regular diploma constitutes 
a change in placement, requiring written prior notice in accordance with 
Sec. 300.503.
    (b) Documents relating to exceptions. The State must have on file 
with the Secretary--
    (1)(i) Information that describes in detail the extent to which the 
exception in paragraph (a)(1) of this section applies to the State; and
    (ii) A copy of each State law, court order, and other documents that 
provide a basis for the exception; and
    (2) With respect to paragraph (a)(2) of this section, a copy of the 
State law that excludes from services under Part B of the Act certain 
students who are incarcerated in an adult correctional facility.

(Authority: 20 U.S.C. 1412(a)(1)(B))



Sec. 300.123  Full educational opportunity goal (FEOG).

    The State must have on file with the Secretary detailed policies and 
procedures through which the State has established a goal of providing 
full educational opportunity to all children with disabilities aged 
birth through 21.

(Authority: 20 U.S.C. 1412(a)(2))



Sec. 300.124  FEOG--timetable.

    The State must have on file with the Secretary a detailed timetable 
for accomplishing the goal of providing full educational opportunity for 
all children with disabilities.

(Authority: 20 U.S.C. 1412(a)(2))



Sec. 300.125  Child find.

    (a) General requirement. (1) The State must have in effect policies 
and procedures to ensure that--
    (i) All children with disabilities residing in the State, including 
children with disabilities attending private schools, regardless of the 
severity of their disability, and who are in need of special education 
and related services, are identified, located, and evaluated; and
    (ii) A practical method is developed and implemented to determine 
which children are currently receiving needed special education and 
related services.
    (2) The requirements of paragraph (a)(1) of this section apply to--
    (i) Highly mobile children with disabilities (such as migrant and 
homeless children); and
    (ii) Children who are suspected of being a child with a disability 
under Sec. 300.7 and in need of special education, even though they are 
advancing from grade to grade.
    (b) Documents relating to child find. The State must have on file 
with the Secretary the policies and procedures described in paragraph 
(a) of this section, including--
    (1) The name of the State agency (if other than the SEA) responsible 
for coordinating the planning and implementation of the policies and 
procedures under paragraph (a) of this section;
    (2) The name of each agency that participates in the planning and 
implementation of the child find activities and a description of the 
nature and extent of its participation;
    (3) A description of how the policies and procedures under paragraph 
(a) of this section will be monitored to ensure that the SEA obtains--
    (i) The number of children with disabilities within each disability 
category that have been identified, located, and evaluated; and
    (ii) Information adequate to evaluate the effectiveness of those 
policies and procedures; and
    (4) A description of the method the State uses to determine which 
children are currently receiving special education and related services.
    (c) Child find for children from birth through age 2 when the SEA 
and lead agency for the Part C program are different. (1) In States 
where the SEA and the State's lead agency for the Part C program are 
different and the Part C lead agency will be participating in the child 
find activities described in paragraph (a) of this section, a 
description of the nature and extent of the Part C lead agency's 
participation must be included under paragraph (b)(2) of this section.
    (2) With the SEA's agreement, the Part C lead agency's participation 
may include the actual implementation of

[[Page 23]]

child find activities for infants and toddlers with disabilities.
    (3) The use of an interagency agreement or other mechanism for 
providing for the Part C lead agency's participation does not alter or 
diminish the responsibility of the SEA to ensure compliance with the 
requirements of this section.
    (d) Construction. Nothing in the Act requires that children be 
classified by their disability so long as each child who has a 
disability listed in Sec. 300.7 and who, by reason of that disability, 
needs special education and related services is regarded as a child with 
a disability under Part B of the Act.
    (e) Confidentiality of child find data. The collection and use of 
data to meet the requirements of this section are subject to the 
confidentiality requirements of Sec. Sec. 300.560-300.577.

(Authority: 20 U.S.C. 1412 (a)(3)(A) and (B))



Sec. 300.126  Procedures for evaluation and determination of eligibility.

    The State must have on file with the Secretary policies and 
procedures that ensure that the requirements of Sec. Sec. 300.530-
300.536 are met.

(Authority: 20 U.S.C. 1412(a)(6)(B), (7))



Sec. 300.127  Confidentiality of personally identifiable information.

    (a) The State must have on file in detail the policies and 
procedures that the State has undertaken to ensure protection of the 
confidentiality of any personally identifiable information, collected, 
used, or maintained under Part B of the Act.
    (b) The Secretary uses the criteria in Sec. Sec. 300.560-300.576 to 
evaluate the policies and procedures of the State under paragraph (a) of 
this section.

(Authority: 20 U.S.C. 1412(a)(8))



Sec. 300.128  Individualized education programs.

    (a) General. The State must have on file with the Secretary 
information that shows that an IEP, or an IFSP that meets the 
requirements of section 636(d) of the Act, is developed, reviewed, and 
revised for each child with a disability in accordance with Sec. Sec. 
300.340-300.350.
    (b) Required information. The information described in paragraph (a) 
of this section must include--
    (1) A copy of each State statute, policy, and standard that 
regulates the manner in which IEPs are developed, implemented, reviewed, 
and revised; and
    (2) The procedures that the SEA follows in monitoring and evaluating 
those IEPs or IFSPs.

(Authority: 20 U.S.C. 1412(a)(4))



Sec. 300.129  Procedural safeguards.

    (a) The State must have on file with the Secretary procedural 
safeguards that ensure that the requirements of Sec. Sec. 300.500-
300.529 are met.
    (b) Children with disabilities and their parents must be afforded 
the procedural safeguards identified in paragraph (a) of this section.

(Authority: 20 U.S.C. 1412(a)(6)(A))



Sec. 300.130  Least restrictive environment.

    (a) General. The State must have on file with the Secretary 
procedures that ensure that the requirements of Sec. Sec. 300.550-
300.556 are met, including the provision in Sec. 300.551 requiring a 
continuum of alternative placements to meet the unique needs of each 
child with a disability.
    (b) Additional requirement. (1) If the State uses a funding 
mechanism by which the State distributes State funds on the basis of the 
type of setting where a child is served, the funding mechanism may not 
result in placements that violate the requirements of paragraph (a) of 
this section.
    (2) If the State does not have policies and procedures to ensure 
compliance with paragraph (b)(1) of this section, the State must provide 
the Secretary an assurance that the State will revise the funding 
mechanism as soon as feasible to ensure that the mechanism does not 
result in placements that violate that paragraph.

(Authority: 20 U.S.C. 1412(a)(5))

[[Page 24]]



Sec. 300.131  [Reserved]



Sec. 300.132  Transition of children from Part C to preschool programs.

    The State must have on file with the Secretary policies and 
procedures to ensure that--
    (a) Children participating in early-intervention programs assisted 
under Part C of the Act, and who will participate in preschool programs 
assisted under Part B of the Act, experience a smooth and effective 
transition to those preschool programs in a manner consistent with 
section 637(a)(8) of the Act;
    (b) By the third birthday of a child described in paragraph (a) of 
this section, an IEP or, if consistent with Sec. 300.342(c) and section 
636(d) of the Act, an IFSP, has been developed and is being implemented 
for the child consistent with Sec. 300.121(c); and
    (c) Each LEA will participate in transition planning conferences 
arranged by the designated lead agency under section 637(a)(8) of the 
Act.

(Authority: 20 U.S.C. 1412(a)(9))



Sec. 300.133  Children in private schools.

    The State must have on file with the Secretary policies and 
procedures that ensure that the requirements of Sec. Sec. 300.400-
300.403 and Sec. Sec. 300.450-300.462 are met.

(Authority: 20 U.S.C. 1413(a)(4))



Sec. 300.134  [Reserved]



Sec. 300.135  Comprehensive system of personnel development.

    (a) General. The State must have in effect, consistent with the 
purposes of this part and with section 635(a)(8) of the Act, a 
comprehensive system of personnel development that--
    (1) Is designed to ensure an adequate supply of qualified special 
education, regular education, and related services personnel; and
    (2) Meets the requirements for a State improvement plan relating to 
personnel development in section 653(b)(2)(B) and (c)(3)(D) of the Act.
    (b) Information. The State must have on file with the Secretary 
information that shows that the requirements of paragraph (a) of this 
section are met.

(Authority: 20 U.S.C. 1412(a)(14))



Sec. 300.136  Personnel standards.

    (a) Definitions. As used in this part--
    (1) Appropriate professional requirements in the State means entry 
level requirements that--
    (i) Are based on the highest requirements in the State applicable to 
the profession or discipline in which a person is providing special 
education or related services; and
    (ii) Establish suitable qualifications for personnel providing 
special education and related services under Part B of the Act to 
children with disabilities who are served by State, local, and private 
agencies (see Sec. 300.2);
    (2) Highest requirements in the State applicable to a specific 
profession or discipline means the highest entry-level academic degree 
needed for any State-approved or -recognized certification, licensing, 
registration, or other comparable requirements that apply to that 
profession or discipline;
    (3) Profession or discipline means a specific occupational category 
that--
    (i) Provides special education and related services to children with 
disabilities under Part B of the Act;
    (ii) Has been established or designated by the State;
    (iii) Has a required scope of responsibility and degree of 
supervision; and
    (iv) Is not limited to traditional occupational categories; and
    (4) State-approved or -recognized certification, licensing, 
registration, or other comparable requirements means the requirements 
that a State legislature either has enacted or has authorized a State 
agency to promulgate through rules to establish the entry-level 
standards for employment in a specific profession or discipline in that 
State.
    (b) Policies and procedures. (1)(i) The State must have on file with 
the Secretary policies and procedures relating to the establishment and 
maintenance of standards to ensure that personnel necessary to carry out 
the purposes of this part are appropriately and adequately prepared and 
trained.

[[Page 25]]

    (ii) The policies and procedures required in paragraph (b)(1)(i) of 
this section must provide for the establishment and maintenance of 
standards that are consistent with any State-approved or -recognized 
certification, licensing, registration, or other comparable requirements 
that apply to the profession or discipline in which a person is 
providing special education or related services.
    (2) Each State may--
    (i) Determine the specific occupational categories required to 
provide special education and related services within the State; and
    (ii) Revise or expand those categories as needed.
    (3) Nothing in this part requires a State to establish a specified 
training standard (e.g., a masters degree) for personnel who provide 
special education and related services under Part B of the Act.
    (4) A State with only one entry-level academic degree for employment 
of personnel in a specific profession or discipline may modify that 
standard as necessary to ensure the provision of FAPE to all children 
with disabilities in the State without violating the requirements of 
this section.
    (c) Steps for retraining or hiring personnel. To the extent that a 
State's standards for a profession or discipline, including standards 
for temporary or emergency certification, are not based on the highest 
requirements in the State applicable to a specific profession or 
discipline, the State must provide the steps the State is taking and the 
procedures for notifying public agencies and personnel of those steps 
and the timelines it has established for the retraining or hiring of 
personnel to meet appropriate professional requirements in the State.
    (d) Status of personnel standards in the State. (1) In meeting the 
requirements in paragraphs (b) and (c) of this section, a determination 
must be made about the status of personnel standards in the State. That 
determination must be based on current information that accurately 
describes, for each profession or discipline in which personnel are 
providing special education or related services, whether the applicable 
standards are consistent with the highest requirements in the State for 
that profession or discipline.
    (2) The information required in paragraph (d)(1) of this section 
must be on file in the SEA and available to the public.
    (e) Applicability of State statutes and agency rules. In identifying 
the highest requirements in the State for purposes of this section, the 
requirements of all State statutes and the rules of all State agencies 
applicable to serving children with disabilities must be considered.
    (f) Use of paraprofessionals and assistants. A State may allow 
paraprofessionals and assistants who are appropriately trained and 
supervised, in accordance with State law, regulations, or written 
policy, in meeting the requirements of this part to be used to assist in 
the provision of special education and related services to children with 
disabilities under Part B of the Act.
    (g) Policy to address shortage of personnel. (1) In implementing 
this section, a State may adopt a policy that includes a requirement 
that LEAs in the State make an ongoing good faith effort to recruit and 
hire appropriately and adequately trained personnel to provide special 
education and related services to children with disabilities, including, 
in a geographic area of the State where there is a shortage of personnel 
that meet these qualifications, the most qualified individuals available 
who are making satisfactory progress toward completing applicable course 
work necessary to meet the standards described in paragraph (b)(2) of 
this section, consistent with State law and the steps described in 
paragraph (c) of this section, within three years.
    (2) If a State has reached its established date under paragraph (c) 
of this section, the State may still exercise the option under paragraph 
(g)(1) of this section for training or hiring all personnel in a 
specific profession or discipline to meet appropriate professional 
requirements in the State.
    (3)(i) Each State must have a mechanism for serving children with 
disabilities if instructional needs exceed available personnel who meet 
appropriate professional requirements in the

[[Page 26]]

State for a specific profession or discipline.
    (ii) A State that continues to experience shortages of qualified 
personnel must address those shortages in its comprehensive system of 
personnel development under Sec. 300.135.

(Authority: 20 U.S.C. 1412(a)(15))



Sec. 300.137  Performance goals and indicators.

    The State must have on file with the Secretary information to 
demonstrate that the State--
    (a) Has established goals for the performance of children with 
disabilities in the State that--
    (1) Will promote the purposes of this part, as stated in Sec. 
300.1; and
    (2) Are consistent, to the maximum extent appropriate, with other 
goals and standards for all children established by the State;
    (b) Has established performance indicators that the State will use 
to assess progress toward achieving those goals that, at a minimum, 
address the performance of children with disabilities on assessments, 
drop-out rates, and graduation rates;
    (c) Every two years, will report to the Secretary and the public on 
the progress of the State, and of children with disabilities in the 
State, toward meeting the goals established under paragraph (a) of this 
section; and
    (d) Based on its assessment of that progress, will revise its State 
improvement plan under subpart 1 of Part D of the Act as may be needed 
to improve its performance, if the State receives assistance under that 
subpart.

(Authority: 20 U.S.C. 1412(a)(16))



Sec. 300.138  Participation in assessments.

    The State must have on file with the Secretary information to 
demonstrate that--
    (a) Children with disabilities are included in general State and 
district-wide assessment programs, with appropriate accommodations and 
modifications in administration, if necessary;
    (b) As appropriate, the State or LEA--
    (1) Develops guidelines for the participation of children with 
disabilities in alternate assessments for those children who cannot 
participate in State and district-wide assessment programs;
    (2) Develops alternate assessments in accordance with paragraph 
(b)(1) of this section; and
    (3) Beginning not later than, July 1, 2000, conducts the alternate 
assessments described in paragraph (b)(2) of this section.

(Authority: 20 U.S.C. 1412(a)(17)(A))



Sec. 300.139  Reports relating to assessments.

    (a) General. In implementing the requirements of Sec. 300.138, the 
SEA shall make available to the public, and report to the public with 
the same frequency and in the same detail as it reports on the 
assessment of nondisabled children, the following information:
    (1) The number of children with disabilities participating--
    (i) In regular assessments; and
    (ii) In alternate assessments.
    (2) The performance results of the children described in paragraph 
(a)(1) of this section if doing so would be statistically sound and 
would not result in the disclosure of performance results identifiable 
to individual children--
    (i) On regular assessments (beginning not later than July 1, 1998); 
and
    (ii) On alternate assessments (not later than July 1, 2000).
    (b) Combined reports. Reports to the public under paragraph (a) of 
this section must include--
    (1) Aggregated data that include the performance of children with 
disabilities together with all other children; and
    (2) Disaggregated data on the performance of children with 
disabilities.
    (c) Timeline for disaggregation of data. Data relating to the 
performance of children described under paragraph (a)(2) of this section 
must be disaggregated--
    (1) For assessments conducted after July 1, 1998; and
    (2) For assessments conducted before July 1, 1998, if the State is 
required to disaggregate the data prior to July 1, 1998.

(Authority: 20 U.S.C. 612(a)(17)(B))

[[Page 27]]



Sec. 300.140  [Reserved]



Sec. 300.141  SEA responsibility for general supervision.

    (a) The State must have on file with the Secretary information that 
shows that the requirements of Sec. 300.600 are met.
    (b) The information described under paragraph (a) of this section 
must include a copy of each State statute, State regulation, signed 
agreement between respective agency officials, and any other documents 
that show compliance with that paragraph.

(Authority: 20 U.S.C. 1412(a)(11))



Sec. 300.142  Methods of ensuring services.

    (a) Establishing responsibility for services. The Chief Executive 
Officer or designee of that officer shall ensure that an interagency 
agreement or other mechanism for interagency coordination is in effect 
between each noneducational public agency described in paragraph (b) of 
this section and the SEA, in order to ensure that all services described 
in paragraph (b)(1) of this section that are needed to ensure FAPE are 
provided, including the provision of these services during the pendency 
of any dispute under paragraph (a)(3) of this section. The agreement or 
mechanism must include the following:
    (1) Agency financial responsibility. An identification of, or a 
method for defining, the financial responsibility of each agency for 
providing services described in paragraph (b)(1) of this section to 
ensure FAPE to children with disabilities. The financial responsibility 
of each noneducational public agency described in paragraph (b) of this 
section, including the State Medicaid agency and other public insurers 
of children with disabilities, must precede the financial responsibility 
of the LEA (or the State agency responsible for developing the child's 
IEP).
    (2) Conditions and terms of reimbursement. The conditions, terms, 
and procedures under which an LEA must be reimbursed by other agencies.
    (3) Interagency disputes. Procedures for resolving interagency 
disputes (including procedures under which LEAs may initiate 
proceedings) under the agreement or other mechanism to secure 
reimbursement from other agencies or otherwise implement the provisions 
of the agreement or mechanism.
    (4) Coordination of services procedures. Policies and procedures for 
agencies to determine and identify the interagency coordination 
responsibilities of each agency to promote the coordination and timely 
and appropriate delivery of services described in paragraph (b)(1) of 
this section.
    (b) Obligation of noneducational public agencies. (1) General. (i) 
If any public agency other than an educational agency is otherwise 
obligated under Federal or State law, or assigned responsibility under 
State policy or pursuant to paragraph (a) of this section, to provide or 
pay for any services that are also considered special education or 
related services (such as, but not limited to, services described in 
Sec. 300.5 relating to assistive technology devices, Sec. 300.6 
relating to assistive technology services, Sec. 300.24 relating to 
related services, Sec. 300.28 relating to supplementary aids and 
services, and Sec. 300.29 relating to transition services) that are 
necessary for ensuring FAPE to children with disabilities within the 
State, the public agency shall fulfill that obligation or 
responsibility, either directly or through contract or other 
arrangement.
    (ii) A noneducational public agency described in paragraph (b)(1)(i) 
of this section may not disqualify an eligible service for Medicaid 
reimbursement because that service is provided in a school context.
    (2) Reimbursement for services by noneducational public agency. If a 
public agency other than an educational agency fails to provide or pay 
for the special education and related services described in paragraph 
(b)(1) of this section, the LEA (or State agency responsible for 
developing the child's IEP) shall provide or pay for these services to 
the child in a timely manner. The LEA or State agency may then claim 
reimbursement for the services from the noneducational public agency 
that failed to provide or pay for these services and that agency shall 
reimburse the LEA or State agency in accordance with the terms of the 
interagency

[[Page 28]]

agreement or other mechanism described in paragraph (a)(1) of this 
section, and the agreement described in paragraph (a)(2) of this 
section.
    (c) Special rule. The requirements of paragraph (a) of this section 
may be met through--
    (1) State statute or regulation;
    (2) Signed agreements between respective agency officials that 
clearly identify the responsibilities of each agency relating to the 
provision of services; or
    (3) Other appropriate written methods as determined by the Chief 
Executive Officer of the State or designee of that officer.
    (d) Information. The State must have on file with the Secretary 
information to demonstrate that the requirements of paragraphs (a) 
through (c) of this section are met.
    (e) Children with disabilities who are covered by public insurance. 
(1) A public agency may use the Medicaid or other public insurance 
benefits programs in which a child participates to provide or pay for 
services required under this part, as permitted under the public 
insurance program, except as provided in paragraph (e)(2) of this 
section.
    (2) With regard to services required to provide FAPE to an eligible 
child under this part, the public agency--
    (i) May not require parents to sign up for or enroll in public 
insurance programs in order for their child to receive FAPE under Part B 
of the Act;
    (ii) May not require parents to incur an out-of-pocket expense such 
as the payment of a deductible or co-pay amount incurred in filing a 
claim for services provided pursuant to this part, but pursuant to 
paragraph (g)(2) of this section, may pay the cost that the parent 
otherwise would be required to pay; and
    (iii) May not use a child's benefits under a public insurance 
program if that use would--
    (A) Decrease available lifetime coverage or any other insured 
benefit;
    (B) Result in the family paying for services that would otherwise be 
covered by the public insurance program and that are required for the 
child outside of the time the child is in school;
    (C) Increase premiums or lead to the discontinuation of insurance; 
or
    (D) Risk loss of eligibility for home and community-based waivers, 
based on aggregate health-related expenditures.
    (f) Children with disabilities who are covered by private insurance. 
(1) With regard to services required to provide FAPE to an eligible 
child under this part, a public agency may access a parent's private 
insurance proceeds only if the parent provides informed consent 
consistent with Sec. 300.500(b)(1).
    (2) Each time the public agency proposes to access the parent's 
private insurance proceeds, it must--
    (i) Obtain parent consent in accordance with paragraph (f)(1) of 
this section; and
    (ii) Inform the parents that their refusal to permit the public 
agency to access their private insurance does not relieve the public 
agency of its responsibility to ensure that all required services are 
provided at no cost to the parents.
    (g) Use of Part B funds. (1) If a public agency is unable to obtain 
parental consent to use the parent's private insurance, or public 
insurance when the parent would incur a cost for a specified service 
required under this part, to ensure FAPE the public agency may use its 
Part B funds to pay for the service.
    (2) To avoid financial cost to parents who otherwise would consent 
to use private insurance, or public insurance if the parent would incur 
a cost, the public agency may use its Part B funds to pay the cost the 
parents otherwise would have to pay to use the parent's insurance (e.g., 
the deductible or co-pay amounts).
    (h) Proceeds from public or private insurance. (1) Proceeds from 
public or private insurance will not be treated as program income for 
purposes of 34 CFR 80.25.
    (2) If a public agency spends reimbursements from Federal funds 
(e.g., Medicaid) for services under this part, those funds will not be 
considered ``State or local'' funds for purposes of the maintenance of 
effort provisions in Sec. Sec. 300.154 and 300.231.

[[Page 29]]

    (i) Construction. Nothing in this part should be construed to alter 
the requirements imposed on a State Medicaid agency, or any other agency 
administering a public insurance program by Federal statute, regulations 
or policy under title XIX, or title XXI of the Social Security Act, or 
any other public insurance program.

(Authority: 20 U.S.C. 1412(a)(12)(A), (B), and (C); 1401(8))



Sec. 300.143  SEA implementation of procedural safeguards.

    The State must have on file with the Secretary the procedures that 
the SEA (and any agency assigned responsibility pursuant to Sec. 
300.600(d)) follows to inform each public agency of its responsibility 
for ensuring effective implementation of procedural safeguards for the 
children with disabilities served by that public agency.

(Authority: 20 U.S.C. 1412(a)(11); 1415(a))



Sec. 300.144  Hearings relating to LEA eligibility.

    The State must have on file with the Secretary procedures to ensure 
that the SEA does not make any final determination that an LEA is not 
eligible for assistance under Part B of the Act without first giving the 
LEA reasonable notice and an opportunity for a hearing under 34 CFR 
76.401(d).

(Authority: 20 U.S.C. 1412(a)(13))



Sec. 300.145  Recovery of funds for misclassified children.

    The State must have on file with the Secretary policies and 
procedures that ensure that the State seeks to recover any funds 
provided under Part B of the Act for services to a child who is 
determined to be erroneously classified as eligible to be counted under 
section 611(a) or (d) of the Act.

(Authority: 20 U.S.C. 1221e-3(a)(1))



Sec. 300.146  Suspension and expulsion rates.

    The State must have on file with the Secretary information to 
demonstrate that the following requirements are met:
    (a) General. The SEA examines data to determine if significant 
discrepancies are occurring in the rate of long-term suspensions and 
expulsions of children with disabilities--
    (1) Among LEAs in the State; or
    (2) Compared to the rates for nondisabled children within the 
agencies.
    (b) Review and revision of policies. If the discrepancies described 
in paragraph (a) of this section are occurring, the SEA reviews and, if 
appropriate, revises (or requires the affected State agency or LEA to 
revise) its policies, procedures, and practices relating to the 
development and implementation of IEPs, the use of behavioral 
interventions, and procedural safeguards, to ensure that these policies, 
procedures, and practices comply with the Act.

(Authority: 20 U.S.C. 612(a)(22))



Sec. 300.147  Additional information if SEA provides direct services.

    (a) If the SEA provides FAPE to children with disabilities, or 
provides direct services to these children, the agency--
    (1) Shall comply with any additional requirements of Sec. Sec. 
300.220-300.230(a) and 300.234-300.250 as if the agency were an LEA; and
    (2) May use amounts that are otherwise available to the agency under 
Part B of the Act to serve those children without regard to Sec. 
300.184 (relating to excess costs).
    (b) The SEA must have on file with the Secretary information to 
demonstrate that it meets the requirements of paragraph (a)(1) of this 
section.

(Authority: 20 U.S.C. 1412(b))



Sec. 300.148  Public participation.

    (a) General; exception. (1) Subject to paragraph (a)(2) of this 
section, each State must ensure that, prior to the adoption of any 
policies and procedures needed to comply with this part, there are 
public hearings, adequate notice of the hearings, and an opportunity for 
comment available to the general public, including individuals with 
disabilities and parents of children with disabilities consistent with 
Sec. Sec. 300.280-300.284.
    (2) A State will be considered to have met paragraph (a)(1) of this 
section with regard to a policy or procedure needed to comply with this 
part if it

[[Page 30]]

can demonstrate that prior to the adoption of that policy or procedure, 
the policy or procedure was subjected to a public review and comment 
process that is required by the State for other purposes and is 
comparable to and consistent with the requirements of Sec. Sec. 
300.280-300.284.
    (b) Documentation. The State must have on file with the Secretary 
information to demonstrate that the requirements of paragraph (a) of 
this section are met.

(Authority: 20 U.S.C. 1412(a)(20))



Sec. 300.149  [Reserved]



Sec. 300.150  State advisory panel.

    The State must have on file with the Secretary information to 
demonstrate that the State has established and maintains an advisory 
panel for the purpose of providing policy guidance with respect to 
special education and related services for children with disabilities in 
the State in accordance with the requirements of Sec. Sec. 300.650-
300.653.

(Authority: 20 U.S.C. 1412(a)(21)(A))



Sec. 300.151  [Reserved]



Sec. 300.152  Prohibition against commingling.

    (a) The State must have on file with the Secretary an assurance 
satisfactory to the Secretary that the funds under Part B of the Act are 
not commingled with State funds.
    (b) The assurance in paragraph (a) of this section is satisfied by 
the use of a separate accounting system that includes an audit trail of 
the expenditure of the Part B funds. Separate bank accounts are not 
required. (See 34 CFR 76.702 (Fiscal control and fund accounting 
procedures).)

(Authority: 20 U.S.C. 1412(a)(18)(B))



Sec. 300.153  State-level nonsupplanting.

    (a) General. (1) Except as provided in Sec. 300.230, funds paid to 
a State under Part B of the Act must be used to supplement the level of 
Federal, State, and local funds (including funds that are not under the 
direct control of the SEA or LEAs) expended for special education and 
related services provided to children with disabilities under Part B of 
the Act and in no case to supplant these Federal, State, and local 
funds.
    (2) The State must have on file with the Secretary information to 
demonstrate to the satisfaction of the Secretary that the requirements 
of paragraph (a)(1) of this section are met.
    (b) Waiver. If the State provides clear and convincing evidence that 
all children with disabilities have available to them FAPE, the 
Secretary may waive, in whole or in part, the requirements of paragraph 
(a) of this section if the Secretary concurs with the evidence provided 
by the State under Sec. 300.589.

(Authority: 20 U.S.C. 1412(a)(18)(c))



Sec. 300.154  Maintenance of State financial support.

    (a) General. The State must have on file with the Secretary 
information to demonstrate, on either a total or per-capita basis, that 
the State will not reduce the amount of State financial support for 
special education and related services for children with disabilities, 
or otherwise made available because of the excess costs of educating 
those children, below the amount of that support for the preceding 
fiscal year.
    (b) Reduction of funds for failure to maintain support. The 
Secretary reduces the allocation of funds under section 611 of the Act 
for any fiscal year following the fiscal year in which the State fails 
to comply with the requirement of paragraph (a) of this section by the 
same amount by which the State fails to meet the requirement.
    (c) Waivers for exceptional or uncontrollable circumstances. The 
Secretary may waive the requirement of paragraph (a) of this section for 
a State, for one fiscal year at a time, if the Secretary determines 
that--
    (1) Granting a waiver would be equitable due to exceptional or 
uncontrollable circumstances such as a natural disaster or a precipitous 
and unforeseen decline in the financial resources of the State; or
    (2) The State meets the standard in Sec. 300.589 for a waiver of 
the requirement to supplement, and not to supplant, funds received under 
Part B of the Act.
    (d) Subsequent years. If, for any fiscal year, a State fails to meet 
the requirement of paragraph (a) of this section,

[[Page 31]]

including any year for which the State is granted a waiver under 
paragraph (c) of this section, the financial support required of the 
State in future years under paragraph (a) of this section must be the 
amount that would have been required in the absence of that failure and 
not the reduced level of the State's support.

(Authority: 20 U.S.C. 1412(a)(19))



Sec. 300.155  Policies and procedures for use of Part B funds.

    The State must have on file with the Secretary policies and 
procedures designed to ensure that funds paid to the State under Part B 
of the Act are spent in accordance with the provisions of Part B.

(Authority: 20 U.S.C. 1412(a)(18)(A))



Sec. 300.156  Annual description of use of Part B funds.

    (a) In order to receive a grant in any fiscal year a State must 
annually describe--
    (1) How amounts retained for State-level activities under Sec. 
300.602 will be used to meet the requirements of this part;
    (2) How those amounts will be allocated among the activities 
described in Sec. Sec. 300.621 and 300.370 to meet State priorities 
based on input from LEAs; and
    (3) The percentage of those amounts, if any, that will be 
distributed to LEAs by formula.
    (b) If a State's plans for use of its funds under Sec. Sec. 300.370 
and 300.620 for the forthcoming year do not change from the prior year, 
the State may submit a letter to that effect to meet the requirement in 
paragraph (a) of this section.

(Authority: 20 U.S.C. 1411(f)(5))

               LEA and State Agency Eeligibility--General



Sec. 300.180  Condition of assistance.

    An LEA or State agency is eligible for assistance under Part B of 
the Act for a fiscal year if the agency demonstrates to the satisfaction 
of the SEA that it meets the conditions in Sec. Sec. 300.220-300.250.

(Authority: 20 U.S.C. 1413(a))



Sec. 300.181  Exception for prior LEA or State agency policies and 
procedures on file with the SEA.

    If an LEA or a State agency described in Sec. 300.194 has on file 
with the SEA policies and procedures that demonstrate that the LEA or 
State agency meets any requirement of Sec. 300.180, including any 
policies and procedures filed under Part B of the Act as in effect 
before June 4, 1997, the SEA shall consider the LEA or State agency to 
have met the requirement for purposes of receiving assistance under Part 
B of the Act.

(Authority: 20 U.S.C. 1413(b)(1))



Sec. 300.182  Amendments to LEA policies and procedures.

    (a) Modification made by an LEA or a State agency. (1) Subject to 
paragraph (b) of this section, policies and procedures submitted by an 
LEA or a State agency in accordance with this subpart remain in effect 
until it submits to the SEA the modifications that the LEA or State 
agency decides are necessary.
    (2) The provisions of this subpart apply to a modification to an 
LEA's or State agency's policies and procedures in the same manner and 
to the same extent that they apply to the LEA's or State agency's 
original policies and procedures.
    (b) Modifications required by the SEA. The SEA may require an LEA or 
a State agency to modify its policies and procedures, but only to the 
extent necessary to ensure the LEA's or State agency's compliance with 
this part, if--
    (1) After June 4, 1997, the provisions of the Act or the regulations 
in this part are amended;
    (2) There is a new interpretation of the Act by Federal or State 
courts; or
    (3) There is an official finding of noncompliance with Federal or 
State law or regulations.

(Authority: 20 U.S.C. 1413(b))



Sec. 300.183  [Reserved]



Sec. 300.184  Excess cost requirement.

    (a) General. Amounts provided to an LEA under Part B of the Act may 
be used only to pay the excess costs of providing special education and 
related services to children with disabilities.

[[Page 32]]

    (b) Definition. As used in this part, the term excess costs means 
those costs that are in excess of the average annual per-student 
expenditure in an LEA during the preceding school year for an elementary 
or secondary school student, as may be appropriate. Excess costs must be 
computed after deducting--
    (1) Amounts received--
    (i) Under Part B of the Act;
    (ii) Under Part A of title I of the Elementary and Secondary 
Education Act of 1965; or
    (iii) Under Part A of title VII of that Act; and
    (2) Any State or local funds expended for programs that would 
qualify for assistance under any of those parts.
    (c) LLimitation on use of Part B funds. (1) The excess cost 
requirement prevents an LEA from using funds provided under Part B of 
the Act to pay for all of the costs directly attributable to the 
education of a child with a disability, subject to paragraph (c)(2) of 
this section.
    (2) The excess cost requirement does not prevent an LEA from using 
Part B funds to pay for all of the costs directly attributable to the 
education of a child with a disability in any of the ages 3, 4, 5, 18, 
19, 20, or 21, if no local or State funds are available for nondisabled 
children in that age range. However, the LEA must comply with the 
nonsupplanting and other requirements of this part in providing the 
education and services for these children.

(Authority: 20 U.S.C. 1401(7), 1413(a)(2)(A))



Sec. 300.185  Meeting the excess cost requirement.

    (a)(1) General. An LEA meets the excess cost requirement if it has 
spent at least a minimum average amount for the education of its 
children with disabilities before funds under Part B of the Act are 
used.
    (2) The amount described in paragraph (a)(1) of this section is 
determined using the formula in Sec. 300.184(b). This amount may not 
include capital outlay or debt service.
    (b) Joint establishment of eligibility. If two or more LEAs jointly 
establish eligibility in accordance with Sec. 300.190, the minimum 
average amount is the average of the combined minimum average amounts 
determined under Sec. 300.184 in those agencies for elementary or 
secondary school students, as the case may be.

(Authority: 20 U.S.C. 1413(a)(2)(A))



Sec. Sec. 300.186-300.189  [Reserved]



Sec. 300.190  Joint establishment of eligibility.

    (a) General. An SEA may require an LEA to establish its eligibility 
jointly with another LEA if the SEA determines that the LEA would be 
ineligible under this section because the agency would not be able to 
establish and maintain programs of sufficient size and scope to 
effectively meet the needs of children with disabilities.
    (b) Charter school exception. An SEA may not require a charter 
school that is an LEA to jointly establish its eligibility under 
paragraph (a) of this section unless it is explicitly permitted to do so 
under the State's charter school statute.
    (c) Amount of payments. If an SEA requires the joint establishment 
of eligibility under paragraph (a) of this section, the total amount of 
funds made available to the affected LEAs must be equal to the sum of 
the payments that each LEA would have received under Sec. Sec. 300.711-
300.714 if the agencies were eligible for these payments.

(Authority: 20 U.S.C. 1413(e)(1), and (2))



Sec. 300.191  [Reserved]



Sec. 300.192  Requirements for establishing eligibility.

    (a) Requirements for LEAs in general. LEAs that establish joint 
eligibility under this section must--
    (1) Adopt policies and procedures that are consistent with the 
State's policies and procedures under Sec. Sec. 300.121-300.156; and
    (2) Be jointly responsible for implementing programs that receive 
assistance under Part B of the Act.
    (b) Requirements for educational service agencies in general. If an 
educational service agency is required by State law to carry out 
programs under Part B of the Act, the joint responsibilities given to 
LEAs under Part B of the Act--
    (1) Do not apply to the administration and disbursement of any 
payments

[[Page 33]]

received by that educational service agency; and
    (2) Must be carried out only by that educational service agency.
    (c) Additional requirement. Notwithstanding any other provision of 
Sec. Sec. 300.190-300.192, an educational service agency shall provide 
for the education of children with disabilities in the least restrictive 
environment, as required by Sec. 300.130.

(Authority: 20 U.S.C. 1413(e)(3), and (4))



Sec. 300.193  [Reserved]



Sec. 300.194  State agency eligibility.

    Any State agency that desires to receive a subgrant for any fiscal 
year under Sec. Sec. 300.711-300.714 must demonstrate to the 
satisfaction of the SEA that--
    (a) All children with disabilities who are participating in programs 
and projects funded under Part B of the Act receive FAPE, and that those 
children and their parents are provided all the rights and procedural 
safeguards described in this part; and
    (b) The agency meets the other conditions of this subpart that apply 
to LEAs.

(Authority: 20 U.S.C. 1413(i))



Sec. 300.195  [Reserved]



Sec. 300.196  Notification of LEA or State agency in case of ineligibility.

    If the SEA determines that an LEA or State agency is not eligible 
under Part B of the Act, the SEA shall--
    (a) Notify the LEA or State agency of that determination; and
    (b) Provide the LEA or State agency with reasonable notice and an 
opportunity for a hearing.

(Authority: 20 U.S.C. 1413(c))



Sec. 300.197  LEA and State agency compliance.

    (a) General. If the SEA, after reasonable notice and an opportunity 
for a hearing, finds that an LEA or State agency that has been 
determined to be eligible under this section is failing to comply with 
any requirement described in Sec. Sec. 300.220-300.250, the SEA shall 
reduce or may not provide any further payments to the LEA or State 
agency until the SEA is satisfied that the LEA or State agency is 
complying with that requirement.
    (b) Notice requirement. Any State agency or LEA in receipt of a 
notice described in paragraph (a) of this section shall, by means of 
public notice, take the measures necessary to bring the pendency of an 
action pursuant to this section to the attention of the public within 
the jurisdiction of the agency.
    (c) In carrying out its functions under this section, each SEA shall 
consider any decision resulting from a hearing under Sec. Sec. 300.507-
300.528 that is adverse to the LEA or State agency involved in the 
decision.

(Authority: 20 U.S.C. 1413(d))

          LEA and State Agency Eligibility--Specific Conditions



Sec. 300.220  Consistency with State policies.

    (a) General. The LEA, in providing for the education of children 
with disabilities within its jurisdiction, must have in effect policies, 
procedures, and programs that are consistent with the State policies and 
procedures established under Sec. Sec. 300.121-300.156.
    (b) Policies on file with SEA. The LEA must have on file with the 
SEA the policies and procedures described in paragraph (a) of this 
section.

(Authority: 20 U.S.C. 1413(a)(1))



Sec. 300.221  Implementation of CSPD.

    The LEA must have on file with the SEA information to demonstrate 
that--
    (a) All personnel necessary to carry out Part B of the Act within 
the jurisdiction of the agency are appropriately and adequately 
prepared, consistent with the requirements of Sec. Sec. 300.380-
300.382; and
    (b) To the extent the LEA determines appropriate, it shall 
contribute to and use the comprehensive system of personnel development 
of the State established under Sec. 300.135.

(Authority: 20 U.S.C. 1413(a)(3))

[[Page 34]]



Sec. Sec. 300.222-300.229  [Reserved]



Sec. 300.230  Use of amounts.

    The LEA must have on file with the SEA information to demonstrate 
that amounts provided to the LEA under Part B of the Act--
    (a) Will be expended in accordance with the applicable provisions of 
this part;
    (b) Will be used only to pay the excess costs of providing special 
education and related services to children with disabilities, consistent 
with Sec. Sec. 300.184-300.185; and
    (c) Will be used to supplement State, local, and other Federal funds 
and not to supplant those funds.

(Authority: 20 U.S.C. 1413(a)(2)(A))



Sec. 300.231  Maintenance of effort.

    (a) General. Except as provided in Sec. Sec. 300.232 and 300.233, 
funds provided to an LEA under Part B of the Act may not be used to 
reduce the level of expenditures for the education of children with 
disabilities made by the LEA from local funds below the level of those 
expenditures for the preceding fiscal year.
    (b) Information. The LEA must have on file with the SEA information 
to demonstrate that the requirements of paragraph (a) of this section 
are met.
    (c) Standard. (1) Except as provided in paragraph (c)(2) of this 
section, the SEA determines that an LEA complies with paragraph (a) of 
this section for purposes of establishing the LEA's eligibility for an 
award for a fiscal year if the LEA budgets, for the education of 
children with disabilities, at least the same total or per-capita amount 
from either of the following sources as the LEA spent for that purpose 
from the same source for the most recent prior year for which 
information is available:
    (i) Local funds only.
    (ii) The combination of State and local funds.
    (2) An LEA that relies on paragraph (c)(1)(i) of this section for 
any fiscal year must ensure that the amount of local funds it budgets 
for the education of children with disabilities in that year is at least 
the same, either in total or per capita, as the amount it spent for that 
purpose in--
    (i) The most recent fiscal year for which information is available, 
if that year is, or is before, the first fiscal year beginning on or 
after July 1, 1997; or
    (ii) If later, the most recent fiscal year for which information is 
available and the standard in paragraph (c)(1)(i) of this section was 
used to establish its compliance with this section.
    (3) The SEA may not consider any expenditures made from funds 
provided by the Federal Government for which the SEA is required to 
account to the Federal Government or for which the LEA is required to 
account to the Federal Government directly or through the SEA in 
determining an LEA's compliance with the requirement in paragraph (a) of 
this section.

(Authority: 20 U.S.C. 1413(a)(2)(A))



Sec. 300.232  Exception to maintenance of effort.

    An LEA may reduce the level of expenditures by the LEA under Part B 
of the Act below the level of those expenditures for the preceding 
fiscal year if the reduction is attributable to the following:
    (a)(1) The voluntary departure, by retirement or otherwise, or 
departure for just cause, of special education or related services 
personnel, who are replaced by qualified, lower-salaried staff.
    (2) In order for an LEA to invoke the exception in paragraph (a)(1) 
of this section, the LEA must ensure that those voluntary retirements or 
resignations and replacements are in full conformity with:
    (i) Existing school board policies in the agency;
    (ii) The applicable collective bargaining agreement in effect at 
that time; and
    (iii) Applicable State statutes.
    (b) A decrease in the enrollment of children with disabilities.
    (c) The termination of the obligation of the agency, consistent with 
this part, to provide a program of special education to a particular 
child with a disability that is an exceptionally costly program, as 
determined by the SEA, because the child--

[[Page 35]]

    (1) Has left the jurisdiction of the agency;
    (2) Has reached the age at which the obligation of the agency to 
provide FAPE to the child has terminated; or
    (3) No longer needs the program of special education.
    (d) The termination of costly expenditures for long-term purchases, 
such as the acquisition of equipment or the construction of school 
facilities.

(Authority: 20 U.S.C. 1413(a)(2)(B))



Sec. 300.233  Treatment of Federal funds in certain fiscal years.

    (a)(1) Subject to paragraphs (a)(2), (a)(3), and (b) of this 
section, for any fiscal year for which amounts appropriated to carry out 
section 611 of the Act exceed $4.1 billion, an LEA may treat as local 
funds up to 20 percent of the amount of funds it is eligible to receive 
under Sec. 300.712 from that appropriation that exceeds the amount from 
funds appropriated for the previous fiscal year that the LEA was 
eligible to receive under Sec. 300.712.
    (2) The requirements of Sec. Sec. 300.230(c) and 300.231 do not 
apply with respect to the amount that may be treated as local funds 
under paragraph (a)(1) of this section.
    (3) For purposes of this section:
    (i)(A) An LEA is not eligible to receive funds during any period in 
which those funds under this part are withheld from the LEA because of a 
finding of noncompliance under Sec. 300.197 or Sec. 300.587.
    (B) An LEA is eligible to receive funds that have been withheld 
under Sec. 300.197 or Sec. 300.587 but are subsequently released to 
the LEA within the period of the funds availability.
    (ii) An LEA is not eligible to receive funds that have been 
reallocated to other LEAs under Sec. 300.714.
    (b) If an SEA determines that an LEA is not meeting the requirements 
of this part, the SEA may prohibit the LEA from treating funds received 
under Part B of the Act as local funds under paragraph (a)(1) of this 
section for any fiscal year, but only if it is authorized to do so by 
the State constitution or a State statute.

(Authority: 20 U.S.C. 1413(a)(2)(C))

[64 FR 12418, Mar. 12, 1999, as amended at 66 FR 1476, Jan. 8, 2001]



Sec. 300.234  Schoolwide programs under title I of the ESEA.

    (a) General; limitation on amount of Part B funds used. An LEA may 
use funds received under Part B of the Act for any fiscal year to carry 
out a schoolwide program under section 1114 of the Elementary and 
Secondary Education Act of 1965, except that the amount used in any 
schoolwide program may not exceed--
    (1)(i) The amount received by the LEA under Part B for that fiscal 
year; divided by
    (ii) The number of children with disabilities in the jurisdiction of 
the LEA; and multiplied by
    (2) The number of children with disabilities participating in the 
schoolwide program.
    (b) Funding conditions. The funds described in paragraph (a) of this 
section are subject to the following conditions:
    (1) The funds must be considered as Federal Part B funds for 
purposes of the calculations required by Sec. Sec. 300.230(b) and (c).
    (2) The funds may be used without regard to the requirements of 
Sec. 300.230(a).
    (c) Meeting other Part B requirements. Except as provided in 
paragraph (b) of this section, all other requirements of Part B must be 
met by an LEA using Part B funds in accordance with paragraph (a) of 
this section, including ensuring that children with disabilities in 
schoolwide program schools--
    (1) Receive services in accordance with a properly developed IEP; 
and
    (2) Are afforded all of the rights and services guaranteed to 
children with disabilities under the IDEA.

(Authority: 20 U.S.C. 1413(a)(2)(D))



Sec. 300.235  Permissive use of funds.

    (a) General. Subject to paragraph (b) of this section, funds 
provided to an LEA under Part B of the Act may be used for the following 
activities:
    (1) Services and aids that also benefit nondisabled children. For 
the costs of special education and related services

[[Page 36]]

and supplementary aids and services provided in a regular class or other 
education-related setting to a child with a disability in accordance 
with the IEP of the child, even if one or more nondisabled children 
benefit from these services.
    (2) Integrated and coordinated services system. To develop and 
implement a fully integrated and coordinated services system in 
accordance with Sec. 300.244.
    (b) Non-applicability of certain provisions. An LEA does not violate 
Sec. Sec. 300.152, 300.230, and 300.231 based on its use of funds 
provided under Part B of the Act in accordance with paragraphs (a)(1) 
and (a)(2) of this section.

(Authority: 20 U.S.C. 1413(a)(4))



Sec. Sec. 300.236-300.239  [Reserved]



Sec. 300.240  Information for SEA.

    (a) The LEA shall provide the SEA with information necessary to 
enable the SEA to carry out its duties under Part B of the Act, 
including, with respect to Sec. Sec. 300.137 and 300.138, information 
relating to the performance of children with disabilities participating 
in programs carried out under Part B of the Act.
    (b) The LEA must have on file with the SEA an assurance satisfactory 
to the SEA that the LEA will comply with the requirements of paragraph 
(a) of this section.

(Authority: 20 U.S.C. 1413(a)(6))



Sec. 300.241  Treatment of charter schools and their students.

    The LEA must have on file with the SEA information to demonstrate 
that in carrying out this part with respect to charter schools that are 
public schools of the LEA, the LEA will--
    (a) Serve children with disabilities attending those schools in the 
same manner as it serves children with disabilities in its other 
schools; and
    (b) Provide funds under Part B of the Act to those schools in the 
same manner as it provides those funds to its other schools.

(Authority: 20 U.S.C. 1413(a)(5))



Sec. 300.242  Public information.

    The LEA must have on file with the SEA information to demonstrate to 
the satisfaction of the SEA that it will make available to parents of 
children with disabilities and to the general public all documents 
relating to the eligibility of the agency under Part B of the Act.

(Authority: 20 U.S.C. 1413(a)(7))



Sec. 300.243  [Reserved]



Sec. 300.244  Coordinated services system.

    (a) General. An LEA may not use more than 5 percent of the amount 
the agency receives under Part B of the Act for any fiscal year, in 
combination with other amounts (which must include amounts other than 
education funds), to develop and implement a coordinated services system 
designed to improve results for children and families, including 
children with disabilities and their families.
    (b) Activities. In implementing a coordinated services system under 
this section, an LEA may carry out activities that include--
    (1) Improving the effectiveness and efficiency of service delivery, 
including developing strategies that promote accountability for results;
    (2) Service coordination and case management that facilitate the 
linkage of IEPs under Part B of the Act and IFSPs under Part C of the 
Act with individualized service plans under multiple Federal and State 
programs, such as title I of the Rehabilitation Act of 1973 (vocational 
rehabilitation), title XIX of the Social Security Act (Medicaid), and 
title XVI of the Social Security Act (supplemental security income);
    (3) Developing and implementing interagency financing strategies for 
the provision of education, health, mental health, and social services, 
including transition services and related services under the Act; and
    (4) Interagency personnel development for individuals working on 
coordinated services.
    (c) Coordination with certain projects under Elementary and 
Secondary Education Act of 1965. If an LEA is carrying out a coordinated 
services project

[[Page 37]]

under title XI of the Elementary and Secondary Education Act of 1965 and 
a coordinated services project under Part B of the Act in the same 
schools, the agency shall use the amounts under Sec. 300.244 in 
accordance with the requirements of that title.

(Authority: 20 U.S.C. 1413(f))

                      School-Based Improvement Plan



Sec. 300.245  School-based improvement plan.

    (a) General. Each LEA may, in accordance with paragraph (b) of this 
section, use funds made available under Part B of the Act to permit a 
public school within the jurisdiction of the LEA to design, implement, 
and evaluate a school-based improvement plan that--
    (1) Is consistent with the purposes described in section 651(b) of 
the Act; and
    (2) Is designed to improve educational and transitional results for 
all children with disabilities and, as appropriate, for other children 
consistent with Sec. 300.235(a) and (b) in that public school.
    (b) Authority--(1) General. An SEA may grant authority to an LEA to 
permit a public school described in Sec. 300.245 (through a school-
based standing panel established under Sec. 300.247(b)) to design, 
implement, and evaluate a school-based improvement plan described in 
Sec. 300.245 for a period not to exceed 3 years.
    (2) Responsibility of LEA. If an SEA grants the authority described 
in paragraph (b)(1) of this section, an LEA that is granted this 
authority must have the sole responsibility of oversight of all 
activities relating to the design, implementation, and evaluation of any 
school-based improvement plan that a public school is permitted to 
design under this section.

(Authority: 20 U.S.C. 1413(g)(1) and (g)(2)).



Sec. 300.246  Plan requirements.

    A school-based improvement plan described in Sec. 300.245 must--
    (a) Be designed to be consistent with the purposes described in 
section 651(b) of the Act and to improve educational and transitional 
results for all children with disabilities and, as appropriate, for 
other children consistent with Sec. 300.235(a) and (b), who attend the 
school for which the plan is designed and implemented;
    (b) Be designed, evaluated, and, as appropriate, implemented by a 
school-based standing panel established in accordance with Sec. 
300.247(b);
    (c) Include goals and measurable indicators to assess the progress 
of the public school in meeting these goals; and
    (d) Ensure that all children with disabilities receive the services 
described in their IEPs.

(Authority: 20 U.S.C. 1413(g)(3))



Sec. 300.247  Responsibilities of the LEA.

    An LEA that is granted authority under Sec. 300.245(b) to permit a 
public school to design, implement, and evaluate a school-based 
improvement plan shall--
    (a) Select each school under the jurisdiction of the agency that is 
eligible to design, implement, and evaluate the plan;
    (b) Require each school selected under paragraph (a) of this 
section, in accordance with criteria established by the LEA under 
paragraph (c) of this section, to establish a school-based standing 
panel to carry out the duties described in Sec. 300.246(b);
    (c) Establish--
    (1) Criteria that must be used by the LEA in the selection of an 
eligible school under paragraph (a) of this section;
    (2) Criteria that must be used by a public school selected under 
paragraph (a) of this section in the establishment of a school-based 
standing panel to carry out the duties described in Sec. 300.246(b) and 
that ensure that the membership of the panel reflects the diversity of 
the community in which the public school is located and includes, at a 
minimum--
    (i) Parents of children with disabilities who attend a public 
school, including parents of children with disabilities from unserved 
and underserved populations, as appropriate;
    (ii) Special education and general education teachers of public 
schools;

[[Page 38]]

    (iii) Special education and general education administrators, or the 
designee of those administrators, of those public schools; and
    (iv) Related services providers who are responsible for providing 
services to the children with disabilities who attend those public 
schools; and
    (3) Criteria that must be used by the LEA with respect to the 
distribution of funds under Part B of the Act to carry out this section;
    (d) Disseminate the criteria established under paragraph (c) of this 
section to local school district personnel and local parent 
organizations within the jurisdiction of the LEA;
    (e) Require a public school that desires to design, implement, and 
evaluate a school-based improvement plan to submit an application at the 
time, in the manner and accompanied by the information, that the LEA 
shall reasonably require; and
    (f) Establish procedures for approval by the LEA of a school-based 
improvement plan designed under Part B of the Act.

(Authority:1413(g)(4))



Sec. 300.248  Limitation.

    A school-based improvement plan described in Sec. 300.245(a) may be 
submitted to an LEA for approval only if a consensus with respect to any 
matter relating to the design, implementation, or evaluation of the 
goals of the plan is reached by the school-based standing panel that 
designed the plan.

(Authority: 20 U.S.C. 1413(g)(5))



Sec. 300.249  Additional requirements.

    (a) Parental involvement. In carrying out the requirements of 
Sec. Sec. 300.245-300.250, an LEA shall ensure that the parents of 
children with disabilities are involved in the design, evaluation, and, 
if appropriate, implementation of school-based improvement plans in 
accordance with this section.
    (b) Plan approval. An LEA may approve a school-based improvement 
plan of a public school within the jurisdiction of the agency for a 
period of 3 years, if--
    (1) The approval is consistent with the policies, procedures, and 
practices established by the LEA and in accordance with Sec. Sec. 
300.245-300.250; and
    (2) A majority of parents of children who are members of the school-
based standing panel, and a majority of other members of the school-
based standing panel that designed the plan, agree in writing to the 
plan.

(Authority: 20 U.S.C. 1413(g)(6))



Sec. 300.250  Extension of plan.

    If a public school within the jurisdiction of an LEA meets the 
applicable requirements and criteria described in Sec. Sec. 300.246 and 
300.247 at the expiration of the 3-year approval period described Sec. 
300.249(b), the agency may approve a school-based improvement plan of 
the school for an additional 3-year period.

(Authority: 20 U.S.C. 1413(g)(7))

                 Secretary of the Interior--Eligibility



Sec. 300.260  Submission of information.

    The Secretary may provide the Secretary of the Interior amounts 
under Sec. 300.715(b) and (c) for a fiscal year only if the Secretary 
of the Interior submits to the Secretary information that--
    (a) Meets the requirements of section 612(a)(1), (3)--(9), (10)(B), 
(C), (11)--(12), (14)--(17), (20), (21) and (22) of the Act (including 
monitoring and evaluation activities);
    (b) Meets the requirements of section 612(b) and (e) of the Act;
    (c) Meets the requirements of section 613(a)(1), (2)(A)(i), (6), and 
(7) of the Act;
    (d) Meets the requirements of this part that implement the sections 
of the Act listed in paragraphs (a)-(c) of this section;
    (e) Includes a description of how the Secretary of the Interior will 
coordinate the provision of services under Part B of the Act with LEAs, 
tribes and tribal organizations, and other private and Federal service 
providers;
    (f) Includes an assurance that there are public hearings, adequate 
notice of the hearings, and an opportunity for comment afforded to 
members of tribes, tribal governing bodies, and affected local school 
boards before the adoption of the policies, programs, and

[[Page 39]]

procedures described in paragraph (a) of this section;
    (g) Includes an assurance that the Secretary of the Interior will 
provide the information that the Secretary may require to comply with 
section 618 of the Act, including data on the number of children with 
disabilities served and the types and amounts of services provided and 
needed;
    (h)(1) Includes an assurance that the Secretary of the Interior and 
the Secretary of Health and Human Services have entered into a 
memorandum of agreement, to be provided to the Secretary, for the 
coordination of services, resources, and personnel between their 
respective Federal, State, and local offices and with the SEAs and LEAs 
and other entities to facilitate the provision of services to Indian 
children with disabilities residing on or near reservations.
    (2) The agreement must provide for the apportionment of 
responsibilities and costs, including child find, evaluation, diagnosis, 
remediation or therapeutic measures, and (if appropriate) equipment and 
medical or personal supplies, as needed for a child with a disability to 
remain in a school or program; and
    (i) Includes an assurance that the Department of the Interior will 
cooperate with the Department in its exercise of monitoring and 
oversight of the requirements in this section and Sec. Sec. 300.261-
300.267, and any agreements entered into between the Secretary of the 
Interior and other entities under Part B of the Act, and will fulfill 
its duties under Part B of the Act. Section 616(a) of the Act applies to 
the information described in this section.

(Authority: 20 U.S.C. 1411(i)(2))



Sec. 300.261  Public participation.

    In fulfilling the requirements of Sec. 300.260 the Secretary of the 
Interior shall provide for public participation consistent with 
Sec. Sec. 300.280-300.284.

(Authority: 20 U.S.C. 1411(i))



Sec. 300.262  Use of Part B funds.

    (a) The Department of the Interior may use five percent of its 
payment under Sec. 300.715(b) and (c) in any fiscal year, or $500,000, 
whichever is greater, for administrative costs in carrying out the 
provisions of this part.
    (b) Payments to the Secretary of the Interior under Sec. 300.716 
must be used in accordance with that section.

(Authority: 20 U.S.C. 1411(i))



Sec. 300.263  Plan for coordination of services.

    (a) The Secretary of the Interior shall develop and implement a plan 
for the coordination of services for all Indian children with 
disabilities residing on reservations covered under Part B of the Act.
    (b) The plan must provide for the coordination of services 
benefiting these children from whatever source, including tribes, the 
Indian Health Service, other BIA divisions, and other Federal agencies.
    (c) In developing the plan, the Secretary of the Interior shall 
consult with all interested and involved parties.
    (d) The plan must be based on the needs of the children and the 
system best suited for meeting those needs, and may involve the 
establishment of cooperative agreements between the BIA, other Federal 
agencies, and other entities.
    (e) The plan also must be distributed upon request to States, SEAs 
and LEAs, and other agencies providing services to infants, toddlers, 
and children with disabilities, to tribes, and to other interested 
parties.

(Authority: 20 U.S.C. 1411(i)(4))



Sec. 300.264  Definitions.

    (a) Indian. As used in this part, the term Indian means an 
individual who is a member of an Indian tribe.
    (b) Indian tribe. As used in this part, the term Indian tribe means 
any Federal or State Indian tribe, band, rancheria, pueblo, colony, or 
community, including any Alaska Native village or regional village 
corporation (as defined in or established under the Alaska Native Claims 
Settlement Act).

(Authority: 20 U.S.C. 1401(9) and (10))



Sec. 300.265  Establishment of advisory board.

    (a) To meet the requirements of section 612(a)(21) of the Act, the 
Secretary

[[Page 40]]

of the Interior shall establish, not later than December 4, 1997 under 
the BIA, an advisory board composed of individuals involved in or 
concerned with the education and provision of services to Indian 
infants, toddlers, and children with disabilities, including Indians 
with disabilities, Indian parents of the children, teachers, service 
providers, State and local educational officials, representatives of 
tribes or tribal organizations, representatives from State Interagency 
Coordinating Councils under section 641 of the Act in States having 
reservations, and other members representing the various divisions and 
entities of the BIA. The chairperson must be selected by the Secretary 
of the Interior.
    (b) The advisory board shall--
    (1) Assist in the coordination of services within the BIA and with 
other local, State, and Federal agencies in the provision of education 
for infants, toddlers, and children with disabilities;
    (2) Advise and assist the Secretary of the Interior in the 
performance of the Secretary's responsibilities described in section 
611(i) of the Act;
    (3) Develop and recommend policies concerning effective inter- and 
intra-agency collaboration, including modifications to regulations, and 
the elimination of barriers to inter- and intra-agency programs and 
activities;
    (4) Provide assistance and disseminate information on best 
practices, effective program coordination strategies, and 
recommendations for improved educational programming for Indian infants, 
toddlers, and children with disabilities; and
    (5) Provide assistance in the preparation of information required 
under Sec. 300.260(g).

(Authority: 20 U.S.C. 1411(i)(5))



Sec. 300.266  Annual report by advisory board.

    (a) General. The advisory board established under Sec. 300.265 
shall prepare and submit to the Secretary of the Interior and to the 
Congress an annual report containing a description of the activities of 
the advisory board for the preceding year.
    (b) Report to the Secretary. The Secretary of the Interior shall 
make available to the Secretary the report described in paragraph (a) of 
this section.

(Authority: 20 U.S.C. 1411(i)(6)(A))



Sec. 300.267  Applicable regulations.

    The Secretary of the Interior shall comply with the requirements of 
Sec. Sec. 300.301-300.303, 300.305-300.309, 300.340-300.348, 300.351, 
300.360-300.382, 300.400-300.402, 300.500-300.586, 300.600-300.621, and 
300.660-300.662.

(Authority: 20 U.S.C. 1411(i)(2)(A))

                          Public Participation



Sec. 300.280  Public hearings before adopting State policies and procedures.

    Prior to its adoption of State policies and procedures related to 
this part, the SEA shall--
    (a) Make the policies and procedures available to the general 
public;
    (b) Hold public hearings; and
    (c) Provide an opportunity for comment by the general public on the 
policies and procedures.

(Authority: 20 U.S.C. 1412(a)(20))



Sec. 300.281  Notice.

    (a) The SEA shall provide adequate notice to the general public of 
the public hearings.
    (b) The notice must be in sufficient detail to inform the general 
public about--
    (1) The purpose and scope of the State policies and procedures and 
their relation to Part B of the Act;
    (2) The availability of the State policies and procedures;
    (3) The date, time, and location of each public hearing;
    (4) The procedures for submitting written comments about the 
policies and procedures; and
    (5) The timetable for submitting the policies and procedures to the 
Secretary for approval.
    (c) The notice must be published or announced--
    (1) In newspapers or other media, or both, with circulation adequate 
to notify the general public about the hearings; and

[[Page 41]]

    (2) Enough in advance of the date of the hearings to afford 
interested parties throughout the State a reasonable opportunity to 
participate.

(Authority: 20 U.S.C. 1412(a)(20))



Sec. 300.282  Opportunity to participate; comment period.

    (a) The SEA shall conduct the public hearings at times and places 
that afford interested parties throughout the State a reasonable 
opportunity to participate.
    (b) The policies and procedures must be available for comment for a 
period of at least 30 days following the date of the notice under Sec. 
300.281.

(Authority: 20 U.S.C. 1412(a)(20))



Sec. 300.283  Review of public comments before adopting policies and 
procedures.

    Before adopting the policies and procedures, the SEA shall--
    (a) Review and consider all public comments; and
    (b) Make any necessary modifications in those policies and 
procedures.

(Authority: 20 U.S.C. 1412(a)(20))



Sec. 300.284  Publication and availability of approved policies and 
procedures.

    After the Secretary approves a State's policies and procedures, the 
SEA shall give notice in newspapers or other media, or both, that the 
policies and procedures are approved. The notice must name places 
throughout the State where the policies and procedures are available for 
access by any interested person.

(Authority: 20 U.S.C. 1412(a)(20))



                           Subpart C_Services

                    Free Appropriate Public Education



Sec. 300.300  Provision of FAPE.

    (a) General. (1) Subject to paragraphs (b) and (c) of this section 
and Sec. 300.311, each State receiving assistance under this part shall 
ensure that FAPE is available to all children with disabilities, aged 3 
through 21, residing in the State, including children with disabilities 
who have been suspended or expelled from school.
    (2) As a part of its obligation under paragraph (a)(1) of this 
section, each State must ensure that the requirements of Sec. 300.125 
(to identify, locate, and evaluate all children with disabilities) are 
implemented by public agencies throughout the State.
    (3)(i) The services provided to the child under this part address 
all of the child's identified special education and related services 
needs described in paragraph (a) of this section.
    (ii) The services and placement needed by each child with a 
disability to receive FAPE must be based on the child's unique needs and 
not on the child's disability.
    (b) Exception for age ranges 3-5 and 18-21. This paragraph provides 
the rules for applying the requirements in paragraph (a) of this section 
to children with disabilities aged 3, 4, 5, 18, 19, 20, and 21 within 
the State:
    (1) If State law or a court order requires the State to provide 
education for children with disabilities in any disability category in 
any of these age groups, the State must make FAPE available to all 
children with disabilities of the same age who have that disability.
    (2) If a public agency provides education to nondisabled children in 
any of these age groups, it must make FAPE available to at least a 
proportionate number of children with disabilities of the same age.
    (3) If a public agency provides education to 50 percent or more of 
its children with disabilities in any disability category in any of 
these age groups, it must make FAPE available to all its children with 
disabilities of the same age who have that disability. This provision 
does not apply to children aged 3 through 5 for any fiscal year for 
which the State receives a grant under section 619(a)(1) of the Act.
    (4) If a public agency provides education to a child with a 
disability in any of these age groups, it must make FAPE available to 
that child and provide that child and his or her parents all of the 
rights under Part B of the Act and this part.
    (5) A State is not required to make FAPE available to a child with a 
disability in one of these age groups if--

[[Page 42]]

    (i) State law expressly prohibits, or does not authorize, the 
expenditure of public funds to provide education to nondisabled children 
in that age group; or
    (ii) The requirement is inconsistent with a court order that governs 
the provision of free public education to children with disabilities in 
that State.
    (c) Children aged 3 through 21 on Indian reservations. With the 
exception of children identified in Sec. 300.715(b) and (c), the SEA 
shall ensure that all of the requirements of Part B of the Act are 
implemented for all children with disabilities aged 3 through 21 on 
reservations.

(Authority: 20 U.S.C. 1412(a)(1), 1411(i)(1)(C), S. Rep. No. 94--168, p. 
19 (1975))



Sec. 300.301  FAPE--methods and payments.

    (a) Each State may use whatever State, local, Federal, and private 
sources of support are available in the State to meet the requirements 
of this part. For example, if it is necessary to place a child with a 
disability in a residential facility, a State could use joint agreements 
between the agencies involved for sharing the cost of that placement.
    (b) Nothing in this part relieves an insurer or similar third party 
from an otherwise valid obligation to provide or to pay for services 
provided to a child with a disability.
    (c) Consistent with Sec. Sec. 300.342(b)(2) and 300.343(b), the 
State must ensure that there is no delay in implementing a child's IEP, 
including any case in which the payment source for providing or paying 
for special education and related services to the child is being 
determined.

(Authority: 20 U.S.C. 1401(8), 1412(a)(1))



Sec. 300.302  Residential placement.

    If placement in a public or private residential program is necessary 
to provide special education and related services to a child with a 
disability, the program, including non-medical care and room and board, 
must be at no cost to the parents of the child.

(Authority: 20 U.S.C. 1412(a)(1), 1412(a)(10)(B))



Sec. 300.303  Proper functioning of hearing aids.

    Each public agency shall ensure that the hearing aids worn in school 
by children with hearing impairments, including deafness, are 
functioning properly.

(Authority: 20 U.S.C. 1412(a)(1))



Sec. 300.304  Full educational opportunity goal.

    Each SEA shall ensure that each public agency establishes and 
implements a goal of providing full educational opportunity to all 
children with disabilities in the area served by the public agency.

(Authority: 20 U.S.C. 1412(a)(2)



Sec. 300.305  Program options.

    Each public agency shall take steps to ensure that its children with 
disabilities have available to them the variety of educational programs 
and services available to nondisabled children in the area served by the 
agency, including art, music, industrial arts, consumer and homemaking 
education, and vocational education.

(Authority: 20 U.S.C. 1412(a)(2), 1413(a)(1))



Sec. 300.306  Nonacademic services.

    (a) Each public agency shall take steps to provide nonacademic and 
extracurricular services and activities in the manner necessary to 
afford children with disabilities an equal opportunity for participation 
in those services and activities.
    (b) Nonacademic and extracurricular services and activities may 
include counseling services, athletics, transportation, health services, 
recreational activities, special interest groups or clubs sponsored by 
the public agency, referrals to agencies that provide assistance to 
individuals with disabilities, and employment of students, including 
both employment by the public agency and assistance in making outside 
employment available.

(Authority: 20 U.S.C. 1412(a)(1))



Sec. 300.307  Physical education.

    (a) General. Physical education services, specially designed if 
necessary, must be made available to every child with a disability 
receiving FAPE.

[[Page 43]]

    (b) Regular physical education. Each child with a disability must be 
afforded the opportunity to participate in the regular physical 
education program available to nondisabled children unless--
    (1) The child is enrolled full time in a separate facility; or
    (2) The child needs specially designed physical education, as 
prescribed in the child's IEP.
    (c) Special physical education. If specially designed physical 
education is prescribed in a child's IEP, the public agency responsible 
for the education of that child shall provide the services directly or 
make arrangements for those services to be provided through other public 
or private programs.
    (d) Education in separate facilities. The public agency responsible 
for the education of a child with a disability who is enrolled in a 
separate facility shall ensure that the child receives appropriate 
physical education services in compliance with paragraphs (a) and (c) of 
this section.

(Authority: 20 U.S.C. 1412(a)(25), 1412(a)(5)(A))



Sec. 300.308  Assistive technology.

    (a) Each public agency shall ensure that assistive technology 
devices or assistive technology services, or both, as those terms are 
defined in Sec. Sec. 300.5-300.6, are made available to a child with a 
disability if required as a part of the child's--
    (1) Special education under Sec. 300.26;
    (2) Related services under Sec. 300.24; or
    (3) Supplementary aids and services under Sec. Sec. 300.28 and 
300.550(b)(2).
    (b) On a case-by-case basis, the use of school-purchased assistive 
technology devices in a child's home or in other settings is required if 
the child's IEP team determines that the child needs access to those 
devices in order to receive FAPE.

(Authority: 20 U.S.C. 1412(a)(12)(B)(i))



Sec. 300.309  Extended school year services.

    (a) General. (1) Each public agency shall ensure that extended 
school year services are available as necessary to provide FAPE, 
consistent with paragraph (a)(2) of this section.
    (2) Extended school year services must be provided only if a child's 
IEP team determines, on an individual basis, in accordance with 
Sec. Sec. 300.340-300.350, that the services are necessary for the 
provision of FAPE to the child.
    (3) In implementing the requirements of this section, a public 
agency may not--
    (i) Limit extended school year services to particular categories of 
disability; or
    (ii) Unilaterally limit the type, amount, or duration of those 
services.
    (b) Definition. As used in this section, the term extended school 
year services means special education and related services that--
    (1) Are provided to a child with a disability--
    (i) Beyond the normal school year of the public agency;
    (ii) In accordance with the child's IEP; and
    (iii) At no cost to the parents of the child; and
    (2) Meet the standards of the SEA.

(Authority: 20 U.S.C. 1412(a)(1))



Sec. 300.310  [Reserved]



Sec. 300.311  FAPE requirements for students with disabilities in adult 
prisons.

    (a) Exception to FAPE for certain students. Except as provided in 
Sec. 300.122(a)(2)(ii), the obligation to make FAPE available to all 
children with disabilities does not apply with respect to students aged 
18 through 21 to the extent that State law does not require that special 
education and related services under Part B of the Act be provided to 
students with disabilities who, in the last educational placement prior 
to their incarceration in an adult correctional facility--
    (1) Were not actually identified as being a child with a disability 
under Sec. 300.7; and
    (2) Did not have an IEP under Part B of the Act.
    (b) Requirements that do not apply. The following requirements do 
not apply to students with disabilities who are convicted as adults 
under State law and incarcerated in adult prisons:
    (1) The requirements contained in Sec. 300.138 and Sec. 
300.347(a)(5)(i) (relating to

[[Page 44]]

participation of children with disabilities in general assessments).
    (2) The requirements in Sec. 300.347(b) (relating to transition 
planning and transition services), with respect to the students whose 
eligibility under Part B of the Act will end, because of their age, 
before they will be eligible to be released from prison based on 
consideration of their sentence and eligibility for early release.
    (c) Modifications of IEP or placement. (1) Subject to paragraph 
(c)(2) of this section, the IEP team of a student with a disability, who 
is convicted as an adult under State law and incarcerated in an adult 
prison, may modify the student's IEP or placement if the State has 
demonstrated a bona fide security or compelling penological interest 
that cannot otherwise be accommodated.
    (2) The requirements of Sec. Sec. 300.340(a) and 300.347(a) 
relating to IEPs, and 300.550(b) relating to LRE, do not apply with 
respect to the modifications described in paragraph (c)(1) of this 
section.

(Authority: 20 U.S.C. 1412(a)(1), 1414(d)(6))



Sec. 300.312  Children with disabilities in public charter schools.

    (a) Children with disabilities who attend public charter schools and 
their parents retain all rights under this part.
    (b) If the public charter school is an LEA, consistent with Sec. 
300.17, that receives funding under Sec. Sec. 300.711-300.714, that 
charter school is responsible for ensuring that the requirements of this 
part are met, unless State law assigns that responsibility to some other 
entity.
    (c) If the public charter school is a school of an LEA that receives 
funding under Sec. Sec. 300.711-300.714 and includes other public 
schools--
    (1) The LEA is responsible for ensuring that the requirements of 
this part are met, unless State law assigns that responsibility to some 
other entity; and
    (2) The LEA must meet the requirements of Sec. 300.241.
    (d)(1) If the public charter school is not an LEA receiving funding 
under Sec. Sec. 300.711-300.714, or a school that is part of an LEA 
receiving funding under Sec. Sec. 300.711-300.714, the SEA is 
responsible for ensuring that the requirements of this part are met.
    (2) Paragraph (d)(1) of this section does not preclude a State from 
assigning initial responsibility for ensuring the requirements of this 
part are met to another entity; however, the SEA must maintain the 
ultimate responsibility for ensuring compliance with this part, 
consistent with Sec. 300.600.

(Authority: 20 U.S.C. 1413(a)(5))



Sec. 300.313  Children experiencing developmental delays.

    (a) Use of term developmental delay. (1) A State that adopts the 
term developmental delay under Sec. 300.7(b) determines whether it 
applies to children aged 3 through 9, or to a subset of that age range 
(e.g., ages 3 through 5).
    (2) A State may not require an LEA to adopt and use the term 
developmental delay for any children within its jurisdiction.
    (3) If an LEA uses the term developmental delay for children 
described in Sec. 300.7(b), the LEA must conform to both the State's 
definition of that term and to the age range that has been adopted by 
the State.
    (4) If a State does not adopt the term developmental delay, an LEA 
may not independently use that term as a basis for establishing a 
child's eligibility under this part.
    (b) Use of individual disability categories. (1) Any State or LEA 
that elects to use the term developmental delay for children aged 3 
through 9 may also use one or more of the disability categories 
described in Sec. 300.7 for any child within that age range if it is 
determined, through the evaluation conducted under Sec. Sec. 300.530-
300.536, that the child has an impairment described in Sec. 300.7, and 
because of that impairment needs special education and related services.
    (2) The State or LEA shall ensure that all of the child's special 
education and related services needs that have been identified through 
the evaluation described in paragraph (b)(1) of this section are 
appropriately addressed.
    (c) Common definition of developmental delay. A State may adopt a 
common definition of developmental delay for use

[[Page 45]]

in programs under Parts B and C of the Act.

(Authority: 20 U.S.C. 1401(3)(A) and (B))

                      Evaluations and Reevaluations



Sec. 300.320  Initial evaluations.

    (a) Each public agency shall ensure that a full and individual 
evaluation is conducted for each child being considered for special 
education and related services under Part B of the Act--
    (1) To determine if the child is a ``child with a disability'' under 
Sec. 300.7; and
    (2) To determine the educational needs of the child.
    (b) In implementing the requirements of paragraph (a) of this 
section, the public agency shall ensure that--
    (1) The evaluation is conducted in accordance with the procedures 
described in Sec. Sec. 300.530-300.535; and
    (2) The results of the evaluation are used by the child's IEP team 
in meeting the requirements of Sec. Sec. 300.340-300.350.

(Authority: 20 U.S.C. 1414(a), (b), and (c))



Sec. 300.321  Reevaluations.

    Each public agency shall ensure that--
    (a) A reevaluation of each child with a disability is conducted in 
accordance with Sec. 300.536; and
    (b) The results of any reevaluations are addressed by the child's 
IEP team under Sec. Sec. 300.340-300.349 in reviewing and, as 
appropriate, revising the child's IEP.

(Authority: 20 U.S.C. 1414(a)(2))



Sec. Sec. 300.322-300.324  [Reserved]

                    Individualized Education Programs



Sec. 300.340  Definitions related to IEPs.

    (a) Individualized education program. As used in this part, the term 
individualized education program or IEP means a written statement for a 
child with a disability that is developed, reviewed, and revised in a 
meeting in accordance with Sec. Sec. 300.341-300.350.
    (b) Participating agency. As used in Sec. 300.348, participating 
agency means a State or local agency, other than the public agency 
responsible for a student's education, that is financially and legally 
responsible for providing transition services to the student.

(Authority: 20 U.S.C. 1401(11), 1412(a)(10)(B))



Sec. 300.341  Responsibility of SEA and other public agencies for IEPs.

    (a) The SEA shall ensure that each public agency--
    (1) Except as provided in Sec. Sec. 300.450-300.462, develops and 
implements an IEP for each child with a disability served by that 
agency; and
    (2) Ensures that an IEP is developed and implemented for each 
eligible child placed in or referred to a private school or facility by 
the public agency.
    (b) Paragraph (a) of this section applies to--
    (1) The SEA, if it is involved in providing direct services to 
children with disabilities, in accordance with Sec. 300.370(a) and 
(b)(1); and
    (2) Except as provided in Sec. 300.600(d), the other public 
agencies described in Sec. 300.2, including LEAs and other State 
agencies that provide special education and related services either 
directly, by contract, or through other arrangements.

(Authority: 20 U.S.C. 1412(a)(4), (a)(10)(B))



Sec. 300.342  When IEPs must be in effect.

    (a) General. At the beginning of each school year, each public 
agency shall have an IEP in effect for each child with a disability 
within its jurisdiction.
    (b) Implementation of IEPs. Each public agency shall ensure that--
    (1) An IEP--
    (i) Is in effect before special education and related services are 
provided to an eligible child under this part; and
    (ii) Is implemented as soon as possible following the meetings 
described under Sec. 300.343;
    (2) The child's IEP is accessible to each regular education teacher, 
special education teacher, related service provider, and other service 
provider who is responsible for its implementation; and
    (3) Each teacher and provider described in paragraph (b)(2) of this 
section is informed of--

[[Page 46]]

    (i) His or her specific responsibilities related to implementing the 
child's IEP; and
    (ii) The specific accommodations, modifications, and supports that 
must be provided for the child in accordance with the IEP.
    (c) IEP or IFSP for children aged 3 through 5. (1) In the case of a 
child with a disability aged 3 through 5 (or, at the discretion of the 
SEA a 2-year-old child with a disability who will turn age 3 during the 
school year), an IFSP that contains the material described in section 
636 of the Act, and that is developed in accordance with Sec. Sec. 
300.341-300.346 and Sec. Sec. 300.349-300.350, may serve as the IEP of 
the child if using that plan as the IEP is--
    (i) Consistent with State policy; and
    (ii) Agreed to by the agency and the child's parents.
    (2) In implementing the requirements of paragraph (c)(1) of this 
section, the public agency shall--
    (i) Provide to the child's parents a detailed explanation of the 
differences between an IFSP and an IEP; and
    (ii) If the parents choose an IFSP, obtain written informed consent 
from the parents.
    (d) Effective date for new requirements. All IEPs developed, 
reviewed, or revised on or after July 1, 1998 must meet the requirements 
of Sec. Sec. 300.340-300.350.

(Authority: 20 U.S.C. 1414(d)(2)(A) and (B), Pub. L. 105-17, sec. 
201(a)(2)(A), (C)



Sec. 300.343  IEP meetings.

    (a) General. Each public agency is responsible for initiating and 
conducting meetings for the purpose of developing, reviewing, and 
revising the IEP of a child with a disability (or, if consistent with 
Sec. 300.342(c), an IFSP).
    (b) Initial IEPs; provision of services. (1) Each public agency 
shall ensure that within a reasonable period of time following the 
agency's receipt of parent consent to an initial evaluation of a child--
    (i) The child is evaluated; and
    (ii) If determined eligible under this part, special education and 
related services are made available to the child in accordance with an 
IEP.
    (2) In meeting the requirement in paragraph (b)(1) of this section, 
a meeting to develop an IEP for the child must be conducted within 30-
days of a determination that the child needs special education and 
related services.
    (c) Review and revision of IEPs. Each public agency shall ensure 
that the IEP team--
    (1) Reviews the child's IEP periodically, but not less than 
annually, to determine whether the annual goals for the child are being 
achieved; and
    (2) Revises the IEP as appropriate to address--
    (i) Any lack of expected progress toward the annual goals described 
in Sec. 300.347(a), and in the general curriculum, if appropriate;
    (ii) The results of any reevaluation conducted under Sec. 300.536;
    (iii) Information about the child provided to, or by, the parents, 
as described in Sec. 300.533(a)(1);
    (iv) The child's anticipated needs; or
    (v) Other matters.

(Authority: 20 U.S.C. 1413(a)(1), 1414(d)(4)(A)



Sec. 300.344  IEP team.

    (a) General. The public agency shall ensure that the IEP team for 
each child with a disability includes--
    (1) The parents of the child;
    (2) At least one regular education teacher of the child (if the 
child is, or may be, participating in the regular education 
environment);
    (3) At least one special education teacher of the child, or if 
appropriate, at least one special education provider of the child;
    (4) A representative of the public agency who--
    (i) Is qualified to provide, or supervise the provision of, 
specially designed instruction to meet the unique needs of children with 
disabilities;
    (ii) Is knowledgeable about the general curriculum; and
    (iii) Is knowledgeable about the availability of resources of the 
public agency;
    (5) An individual who can interpret the instructional implications 
of evaluation results, who may be a member of the team described in 
paragraphs (a)(2) through (6) of this section;
    (6) At the discretion of the parent or the agency, other individuals 
who have knowledge or special expertise regarding the child, including 
related services personnel as appropriate; and

[[Page 47]]

    (7) If appropriate, the child.
    (b) Transition services participants. (1) Under paragraph (a)(7) of 
this section, the public agency shall invite a student with a disability 
of any age to attend his or her IEP meeting if a purpose of the meeting 
will be the consideration of--
    (i) The student's transition services needs under Sec. 
300.347(b)(1);
    (ii) The needed transition services for the student under Sec. 
300.347(b)(2); or
    (iii) Both.
    (2) If the student does not attend the IEP meeting, the public 
agency shall take other steps to ensure that the student's preferences 
and interests are considered.
    (3)(i) In implementing the requirements of Sec. 300.347(b)(2), the 
public agency also shall invite a representative of any other agency 
that is likely to be responsible for providing or paying for transition 
services.
    (ii) If an agency invited to send a representative to a meeting does 
not do so, the public agency shall take other steps to obtain 
participation of the other agency in the planning of any transition 
services.
    (c) Determination of knowledge and special expertise. The 
determination of the knowledge or special expertise of any individual 
described in paragraph (a)(6) of this section shall be made by the party 
(parents or public agency) who invited the individual to be a member of 
the IEP.
    (d) Designating a public agency representative. A public agency may 
designate another public agency member of the IEP team to also serve as 
the agency representative, if the criteria in paragraph (a)(4) of this 
section are satisfied.

(Authority: 20 U.S.C. 1401(30), 1414(d)(1)(A)(7), (B))



Sec. 300.345  Parent participation.

    (a) Public agency responsibility--general. Each public agency shall 
take steps to ensure that one or both of the parents of a child with a 
disability are present at each IEP meeting or are afforded the 
opportunity to participate, including--
    (1) Notifying parents of the meeting early enough to ensure that 
they will have an opportunity to attend; and
    (2) Scheduling the meeting at a mutually agreed on time and place.
    (b) Information provided to parents. (1) The notice required under 
paragraph (a)(1) of this section must--
    (i) Indicate the purpose, time, and location of the meeting and who 
will be in attendance; and
    (ii) Inform the parents of the provisions in Sec. 300.344(a)(6) and 
(c) (relating to the participation of other individuals on the IEP team 
who have knowledge or special expertise about the child).
    (2) For a student with a disability beginning at age 14, or younger, 
if appropriate, the notice must also--
    (i) Indicate that a purpose of the meeting will be the development 
of a statement of the transition services needs of the student required 
in Sec. 300.347(b)(1); and
    (ii) Indicate that the agency will invite the student.
    (3) For a student with a disability beginning at age 16, or younger, 
if appropriate, the notice must--
    (i) Indicate that a purpose of the meeting is the consideration of 
needed transition services for the student required in Sec. 
300.347(b)(2);
    (ii) Indicate that the agency will invite the student; and
    (iii) Identify any other agency that will be invited to send a 
representative.
    (c) Other methods to ensure parent participation. If neither parent 
can attend, the public agency shall use other methods to ensure parent 
participation, including individual or conference telephone calls.
    (d) Conducting an IEP meeting without a parent in attendance. A 
meeting may be conducted without a parent in attendance if the public 
agency is unable to convince the parents that they should attend. In 
this case the public agency must have a record of its attempts to 
arrange a mutually agreed on time and place, such as--
    (1) Detailed records of telephone calls made or attempted and the 
results of those calls;
    (2) Copies of correspondence sent to the parents and any responses 
received; and
    (3) Detailed records of visits made to the parent's home or place of 
employment and the results of those visits.

[[Page 48]]

    (e) Use of interpreters or other action, as appropriate. The public 
agency shall take whatever action is necessary to ensure that the parent 
understands the proceedings at the IEP meeting, including arranging for 
an interpreter for parents with deafness or whose native language is 
other than English.
    (f) Parent copy of child's IEP. The public agency shall give the 
parent a copy of the child's IEP at no cost to the parent.

(Authority: 20 U.S.C. 1414(d)(1)(B)(i))



Sec. 300.346  Development, review, and revision of IEP.

    (a) Development of IEP. (1) General. In developing each child's IEP, 
the IEP team, shall consider--
    (i) The strengths of the child and the concerns of the parents for 
enhancing the education of their child;
    (ii) The results of the initial or most recent evaluation of the 
child; and
    (iii) As appropriate, the results of the child's performance on any 
general State or district-wide assessment programs.
    (2) Consideration of special factors. The IEP team also shall--
    (i) In the case of a child whose behavior impedes his or her 
learning or that of others, consider, if appropriate, strategies, 
including positive behavioral interventions, strategies, and supports to 
address that behavior;
    (ii) In the case of a child with limited English proficiency, 
consider the language needs of the child as those needs relate to the 
child's IEP;
    (iii) In the case of a child who is blind or visually impaired, 
provide for instruction in Braille and the use of Braille unless the IEP 
team determines, after an evaluation of the child's reading and writing 
skills, needs, and appropriate reading and writing media (including an 
evaluation of the child's future needs for instruction in Braille or the 
use of Braille), that instruction in Braille or the use of Braille is 
not appropriate for the child;
    (iv) Consider the communication needs of the child, and in the case 
of a child who is deaf or hard of hearing, consider the child's language 
and communication needs, opportunities for direct communications with 
peers and professional personnel in the child's language and 
communication mode, academic level, and full range of needs, including 
opportunities for direct instruction in the child's language and 
communication mode; and
    (v) Consider whether the child requires assistive technology devices 
and services.
    (b) Review and Revision of IEP. In conducting a meeting to review, 
and, if appropriate, revise a child's IEP, the IEP team shall consider 
the factors described in paragraph (a) of this section.
    (c) Statement in IEP. If, in considering the special factors 
described in paragraphs (a)(1) and (2) of this section, the IEP team 
determines that a child needs a particular device or service (including 
an intervention, accommodation, or other program modification) in order 
for the child to receive FAPE, the IEP team must include a statement to 
that effect in the child's IEP.
    (d) Requirement with respect to regular education teacher. The 
regular education teacher of a child with a disability, as a member of 
the IEP team, must, to the extent appropriate, participate in the 
development, review, and revision of the child's IEP, including 
assisting in the determination of--
    (1) Appropriate positive behavioral interventions and strategies for 
the child; and
    (2) Supplementary aids and services, program modifications or 
supports for school personnel that will be provided for the child, 
consistent with Sec. 300.347(a)(3).
    (e) Construction. Nothing in this section shall be construed to 
require the IEP team to include information under one component of a 
child's IEP that is already contained under another component of the 
child's IEP.

(Authority: 20 U.S.C. 1414(d)(3) and (4)(B) and (e))



Sec. 300.347  Content of IEP.

    (a) General. The IEP for each child with a disability must include--
    (1) A statement of the child's present levels of educational 
performance, including--
    (i) How the child's disability affects the child's involvement and 
progress in the general curriculum (i.e., the same curriculum as for 
nondisabled children); or

[[Page 49]]

    (ii) For preschool children, as appropriate, how the disability 
affects the child's participation in appropriate activities;
    (2) A statement of measurable annual goals, including benchmarks or 
short-term objectives, related to--
    (i) Meeting the child's needs that result from the child's 
disability to enable the child to be involved in and progress in the 
general curriculum (i.e., the same curriculum as for nondisabled 
children), or for preschool children, as appropriate, to participate in 
appropriate activities; and
    (ii) Meeting each of the child's other educational needs that result 
from the child's disability;
    (3) A statement of the special education and related services and 
supplementary aids and services to be provided to the child, or on 
behalf of the child, and a statement of the program modifications or 
supports for school personnel that will be provided for the child--
    (i) To advance appropriately toward attaining the annual goals;
    (ii) To be involved and progress in the general curriculum in 
accordance with paragraph (a)(1) of this section and to participate in 
extracurricular and other nonacademic activities; and
    (iii) To be educated and participate with other children with 
disabilities and nondisabled children in the activities described in 
this section;
    (4) An explanation of the extent, if any, to which the child will 
not participate with nondisabled children in the regular class and in 
the activities described in paragraph (a)(3) of this section;
    (5)(i) A statement of any individual modifications in the 
administration of State or district-wide assessments of student 
achievement that are needed in order for the child to participate in the 
assessment; and
    (ii) If the IEP team determines that the child will not participate 
in a particular State or district-wide assessment of student achievement 
(or part of an assessment), a statement of--
    (A) Why that assessment is not appropriate for the child; and
    (B) How the child will be assessed;
    (6) The projected date for the beginning of the services and 
modifications described in paragraph (a)(3) of this section, and the 
anticipated frequency, location, and duration of those services and 
modifications; and
    (7) A statement of--
    (i) How the child's progress toward the annual goals described in 
paragraph (a)(2) of this section will be measured; and
    (ii) How the child's parents will be regularly informed (through 
such means as periodic report cards), at least as often as parents are 
informed of their nondisabled children's progress, of--
    (A) Their child's progress toward the annual goals; and
    (B) The extent to which that progress is sufficient to enable the 
child to achieve the goals by the end of the year.
    (b) Transition services. The IEP must include--
    (1) For each student with a disability beginning at age 14 (or 
younger, if determined appropriate by the IEP team), and updated 
annually, a statement of the transition service needs of the student 
under the applicable components of the student's IEP that focuses on the 
student's courses of study (such as participation in advanced-placement 
courses or a vocational education program); and
    (2) For each student beginning at age 16 (or younger, if determined 
appropriate by the IEP team), a statement of needed transition services 
for the student, including, if appropriate, a statement of the 
interagency responsibilities or any needed linkages.
    (c) Transfer of rights. In a State that transfers rights at the age 
majority, beginning at least one year before a student reaches the age 
of majority under State law, the student's IEP must include a statement 
that the student has been informed of his or her rights under Part B of 
the Act, if any, that will transfer to the student on reaching the age 
of majority, consistent with Sec. 300.517.

[[Page 50]]

    (d) Students with disabilities convicted as adults and incarcerated 
in adult prisons. Special rules concerning the content of IEPs for 
students with disabilities convicted as adults and incarcerated in adult 
prisons are contained in Sec. 300.311(b) and (c).

(Authority: 20 U.S.C. 1414(d)(1)(A) and (d)(6)(A)(ii))



Sec. 300.348  Agency responsibilities for transition services.

    (a) If a participating agency, other than the public agency, fails 
to provide the transition services described in the IEP in accordance 
with Sec. 300.347(b)(1), the public agency shall reconvene the IEP team 
to identify alternative strategies to meet the transition objectives for 
the student set out in the IEP.
    (b) Nothing in this part relieves any participating agency, 
including a State vocational rehabilitation agency, of the 
responsibility to provide or pay for any transition service that the 
agency would otherwise provide to students with disabilities who meet 
the eligibility criteria of that agency.

(Authority: 20 U.S.C. 1414(d)(5); 1414(d)(1)(A)(vii))



Sec. 300.349  Private school placements by public agencies.

    (a) Developing IEPs. (1) Before a public agency places a child with 
a disability in, or refers a child to, a private school or facility, the 
agency shall initiate and conduct a meeting to develop an IEP for the 
child in accordance with Sec. Sec. 300.346 and 300.347.
    (2) The agency shall ensure that a representative of the private 
school or facility attends the meeting. If the representative cannot 
attend, the agency shall use other methods to ensure participation by 
the private school or facility, including individual or conference 
telephone calls.
    (b) Reviewing and revising IEPs. (1) After a child with a disability 
enters a private school or facility, any meetings to review and revise 
the child's IEP may be initiated and conducted by the private school or 
facility at the discretion of the public agency.
    (2) If the private school or facility initiates and conducts these 
meetings, the public agency shall ensure that the parents and an agency 
representative--
    (i) Are involved in any decision about the child's IEP; and
    (ii) Agree to any proposed changes in the IEP before those changes 
are implemented.
    (c) Responsibility. Even if a private school or facility implements 
a child's IEP, responsibility for compliance with this part remains with 
the public agency and the SEA.

(Authority: 20 U.S.C. 1412(a)(10)(B))



Sec. 300.350  IEP--accountability.

    (a) Provision of services. Subject to paragraph (b) of this section, 
each public agency must--
    (1) Provide special education and related services to a child with a 
disability in accordance with the child's IEP; and
    (2) Make a good faith effort to assist the child to achieve the 
goals and objectives or benchmarks listed in the IEP.
    (b) Accountability. Part B of the Act does not require that any 
agency, teacher, or other person be held accountable if a child does not 
achieve the growth projected in the annual goals and benchmarks or 
objectives. However, the Act does not prohibit a State or public agency 
from establishing its own accountability systems regarding teacher, 
school, or agency performance.
    (c) Construction--parent rights. Nothing in this section limits a 
parent's right to ask for revisions of the child's IEP or to invoke due 
process procedures if the parent feels that the efforts required in 
paragraph (a) of this section are not being made.

(Authority: 20 U.S.C. 1414(d)); Cong. Rec. at H7152 (daily ed., July 21, 
1975))

                       Direct Services by the Sea



Sec. 300.360  Use of LEA allocation for direct services.

    (a) General. An SEA shall use the payments that would otherwise have 
been available to an LEA or to a State agency to provide special 
education and related services directly to children with disabilities 
residing in the area served by that local agency, or for whom that State 
agency is responsible, if the SEA determines that the LEA or State 
agency--

[[Page 51]]

    (1) Has not provided the information needed to establish the 
eligibility of the agency under Part B of the Act;
    (2) Is unable to establish and maintain programs of FAPE that meet 
the requirements of this part;
    (3) Is unable or unwilling to be consolidated with one or more LEAs 
in order to establish and maintain the programs; or
    (4) Has one or more children with disabilities who can best be 
served by a regional or State program or service-delivery system 
designed to meet the needs of these children.
    (b) SEA responsibility if an LEA does not apply for Part B funds. 
(1) If an LEA elects not to apply for its Part B allotment, the SEA must 
use those funds to ensure that FAPE is available to all eligible 
children residing in the jurisdiction of the LEA.
    (2)(i) If the local allotment is not sufficient to meet the purpose 
described in paragraph (b)(1) of this section, the SEA must ensure 
compliance with Sec. Sec. 300.121(a) and 300.300(a).
    (ii) Consistent with Sec. 300.301(a), the [State; SEA] may use 
whatever funding sources are available in the State to implement 
paragraph (b)(2)(i) of this section.
    (c) SEA administrative procedures. (1) In meeting the requirements 
in paragraph (a) of this section, the SEA may provide special education 
and related services directly, by contract, or through other 
arrangements.
    (2) The excess cost requirements of Sec. Sec. 300.184 and 300.185 
do not apply to the SEA.

(Authority: 20 U.S.C. 1413(h)(1))



Sec. 300.361  Nature and location of services.

    The SEA may provide special education and related services under 
Sec. 300.360(a) in the manner and at the location it considers 
appropriate (including regional and State centers). However, the manner 
in which the education and services are provided must be consistent with 
the requirements of this part (including the LRE provisions of 
Sec. Sec. 300.550-300.556).

(Authority: 20 U.S.C. 1413(h)(2))



Sec. Sec. 300.362-300.369  [Reserved]



Sec. 300.370  Use of SEA allocations.

    (a) Each State shall use any funds it retains under Sec. 300.602 
and does not use for administration under Sec. 300.620 for any of the 
following:
    (1) Support and direct services, including technical assistance and 
personnel development and training.
    (2) Administrative costs of monitoring and complaint investigation, 
but only to the extent that those costs exceed the costs incurred for 
those activities during fiscal year 1985.
    (3) To establish and implement the mediation process required by 
Sec. 300.506, including providing for the costs of mediators and 
support personnel.
    (4) To assist LEAs in meeting personnel shortages.
    (5) To develop a State Improvement Plan under subpart 1 of Part D of 
the Act.
    (6) Activities at the State and local levels to meet the performance 
goals established by the State under Sec. 300.137 and to support 
implementation of the State Improvement Plan under subpart 1 of Part D 
of the Act if the State receives funds under that subpart.
    (7) To supplement other amounts used to develop and implement a 
Statewide coordinated services system designed to improve results for 
children and families, including children with disabilities and their 
families, but not to exceed one percent of the amount received by the 
State under section 611 of the Act. This system must be coordinated with 
and, to the extent appropriate, build on the system of coordinated 
services developed by the State under Part C of the Act.
    (8) For subgrants to LEAs for the purposes described in Sec. 
300.622 (local capacity building).
    (b) For the purposes of paragraph (a) of this section--
    (1) Direct services means services provided to a child with a 
disability by the State directly, by contract, or through other 
arrangements; and
    (2) Support services includes implementing the comprehensive system 
of personnel development under Sec. Sec. 300.380-300.382, recruitment 
and training of mediators, hearing officers, and surrogate parents, and 
public information and

[[Page 52]]

parent training activities relating to FAPE for children with 
disabilities.
    (c) Of the funds an SEA retains under paragraph (a) of this section, 
the SEA may use the funds directly, or distribute them to LEAs on a 
competitive, targeted, or formula basis.

(Authority: 20 U.S.C. 1411(f)(3))



Sec. 300.371  [Reserved]



Sec. 300.372  Nonapplicability of requirements that prohibit commingling 
and supplanting of funds.

    A State may use funds it retains under Sec. 300.602 without regard 
to--
    (a) The prohibition on commingling of funds in Sec. 300.152; and
    (b) The prohibition on supplanting other funds in Sec. 300.153.

(Authority: 20 U.S.C. 1411(f)(1)(C))

          Comprehensive System of Personnel Development (CSPD)



Sec. 300.380  General CSPD requirements.

    (a) Each State shall develop and implement a comprehensive system of 
personnel development that--
    (1) Is consistent with the purposes of this part and with section 
635(a)(8) of the Act;
    (2) Is designed to ensure an adequate supply of qualified special 
education, regular education, and related services personnel;
    (3) Meets the requirements of Sec. Sec. 300.381 and 300.382; and
    (4) Is updated at least every five years.
    (b) A State that has a State improvement grant has met the 
requirements of paragraph (a) of this section.

(Authority: 20 U.S.C. 1412(a)(14))



Sec. 300.381  Adequate supply of qualified personnel.

    Each State must include, at least, an analysis of State and local 
needs for professional development for personnel to serve children with 
disabilities that includes, at a minimum--
    (a) The number of personnel providing special education and related 
services; and
    (b) Relevant information on current and anticipated personnel 
vacancies and shortages (including the number of individuals described 
in paragraph (a) of this section with temporary certification), and on 
the extent of certification or retraining necessary to eliminate these 
shortages, that is based, to the maximum extent possible, on existing 
assessments of personnel needs.

(Authority: 20 U.S.C. 1453(b)(2)(B))



Sec. 300.382  Improvement strategies.

    Each State must describe the strategies the State will use to 
address the needs identified under Sec. 300.381. These strategies must 
include how the State will address the identified needs for in-service 
and pre-service preparation to ensure that all personnel who work with 
children with disabilities (including both professional and 
paraprofessional personnel who provide special education, general 
education, related services, or early intervention services) have the 
skills and knowledge necessary to meet the needs of children with 
disabilities. The plan must include a description of how the State 
will--
    (a) Prepare general and special education personnel with the content 
knowledge and collaborative skills needed to meet the needs of children 
with disabilities including how the State will work with other States on 
common certification criteria;
    (b) Prepare professionals and paraprofessionals in the area of early 
intervention with the content knowledge and collaborative skills needed 
to meet the needs of infants and toddlers with disabilities;
    (c) Work with institutions of higher education and other entities 
that (on both a pre-service and an in-service basis) prepare personnel 
who work with children with disabilities to ensure that those 
institutions and entities develop the capacity to support quality 
professional development programs that meet State and local needs;
    (d) Work to develop collaborative agreements with other States for 
the joint support and development of programs to prepare personnel for 
which there is not sufficient demand within a single State to justify 
support or development of a program of preparation;
    (e) Work in collaboration with other States, particularly 
neighboring

[[Page 53]]

States, to address the lack of uniformity and reciprocity in 
credentialing of teachers and other personnel;
    (f) Enhance the ability of teachers and others to use strategies, 
such as behavioral interventions, to address the conduct of children 
with disabilities that impedes the learning of children with 
disabilities and others;
    (g) Acquire and disseminate, to teachers, administrators, school 
board members, and related services personnel, significant knowledge 
derived from educational research and other sources, and how the State 
will, if appropriate, adopt promising practices, materials, and 
technology;
    (h) Recruit, prepare, and retain qualified personnel, including 
personnel with disabilities and personnel from groups that are under-
represented in the fields of regular education, special education, and 
related services;
    (i) Insure that the plan is integrated, to the maximum extent 
possible, with other professional development plans and activities, 
including plans and activities developed and carried out under other 
Federal and State laws that address personnel recruitment and training; 
and
    (j) Provide for the joint training of parents and special education, 
related services, and general education personnel.

(Authority: 20 U.S.C. 1453 (c)(3)(D))



Sec. Sec. 300.383-300.387  [Reserved]



                  Subpart D_Children in Private Schools

  Children With Disabilities in Private Schools Placed or Referred by 
                             Public Agencies



Sec. 300.400  Applicability of Sec. Sec. 300.400-300.402.

    Sections 300.401-300.402 apply only to children with disabilities 
who are or have been placed in or referred to a private school or 
facility by a public agency as a means of providing special education 
and related services.

(Authority: 20 U.S.C. 1412(a)(10)(B))



Sec. 300.401  Responsibility of State educational agency.

    Each SEA shall ensure that a child with a disability who is placed 
in or referred to a private school or facility by a public agency--
    (a) Is provided special education and related services--
    (1) In conformance with an IEP that meets the requirements of 
Sec. Sec. 300.340-300.350; and
    (2) At no cost to the parents;
    (b) Is provided an education that meets the standards that apply to 
education provided by the SEA and LEAs (including the requirements of 
this part); and
    (c) Has all of the rights of a child with a disability who is served 
by a public agency.

(Authority: 20 U.S.C. 1412(a)(10)(B))



Sec. 300.402  Implementation by State educational agency.

    In implementing Sec. 300.401, the SEA shall--
    (a) Monitor compliance through procedures such as written reports, 
on-site visits, and parent questionnaires;
    (b) Disseminate copies of applicable standards to each private 
school and facility to which a public agency has referred or placed a 
child with a disability; and
    (c) Provide an opportunity for those private schools and facilities 
to participate in the development and revision of State standards that 
apply to them.

(Authority: 20 U.S.C. 1412(a)(10)(B))

Children With Disabilities Enrolled by Their Parents in Private Schools 
                          When FAPE Is at Issue



Sec. 300.403  Placement of children by parents if FAPE is at issue.

    (a) General. This part does not require an LEA to pay for the cost 
of education, including special education and related services, of a 
child with a disability at a private school or facility if that agency 
made FAPE available to the child and the parents elected to place the 
child in a private school or facility. However, the public agency

[[Page 54]]

shall include that child in the population whose needs are addressed 
consistent with Sec. Sec. 300.450-300.462.
    (b) Disagreements about FAPE. Disagreements between a parent and a 
public agency regarding the availability of a program appropriate for 
the child, and the question of financial responsibility, are subject to 
the due process procedures of Sec. Sec. 300.500-300.517.
    (c) Reimbursement for private school placement. If the parents of a 
child with a disability, who previously received special education and 
related services under the authority of a public agency, enroll the 
child in a private preschool, elementary, or secondary school without 
the consent of or referral by the public agency, a court or a hearing 
officer may require the agency to reimburse the parents for the cost of 
that enrollment if the court or hearing officer finds that the agency 
had not made FAPE available to the child in a timely manner prior to 
that enrollment and that the private placement is appropriate. A 
parental placement may be found to be appropriate by a hearing officer 
or a court even if it does not meet the State standards that apply to 
education provided by the SEA and LEAs.
    (d) Limitation on reimbursement. The cost of reimbursement described 
in paragraph (c) of this section may be reduced or denied--
    (1) If--
    (i) At the most recent IEP meeting that the parents attended prior 
to removal of the child from the public school, the parents did not 
inform the IEP team that they were rejecting the placement proposed by 
the public agency to provide FAPE to their child, including stating 
their concerns and their intent to enroll their child in a private 
school at public expense; or
    (ii) At least ten (10) business days (including any holidays that 
occur on a business day) prior to the removal of the child from the 
public school, the parents did not give written notice to the public 
agency of the information described in paragraph (d)(1)(i) of this 
section;
    (2) If, prior to the parents' removal of the child from the public 
school, the public agency informed the parents, through the notice 
requirements described in Sec. 300.503(a)(1), of its intent to evaluate 
the child (including a statement of the purpose of the evaluation that 
was appropriate and reasonable), but the parents did not make the child 
available for the evaluation; or
    (3) Upon a judicial finding of unreasonableness with respect to 
actions taken by the parents.
    (e) Exception. Notwithstanding the notice requirement in paragraph 
(d)(1) of this section, the cost of reimbursement may not be reduced or 
denied for failure to provide the notice if--
    (1) The parent is illiterate and cannot write in English;
    (2) Compliance with paragraph (d)(1) of this section would likely 
result in physical or serious emotional harm to the child;
    (3) The school prevented the parent from providing the notice; or
    (4) The parents had not received notice, pursuant to section 615 of 
the Act, of the notice requirement in paragraph (d)(1) of this section.

(Authority: 20 U.S.C. 1412(a)(10)(C))

 Children With Disabilities Enrolled by Their Parents in Private Schools



Sec. 300.450  Definition of ``private school children with disabilities.''

    As used in this part, private school children with disabilities 
means children with disabilities enrolled by their parents in private 
schools or facilities other than children with disabilities covered 
under Sec. Sec. 300.400-300.402.

(Authority: 20 U.S.C. 1412(a)(10)(A))



Sec. 300.451  Child find for private school children with disabilities.

    (a) Each LEA shall locate, identify, and evaluate all private school 
children with disabilities, including religious-school children residing 
in the jurisdiction of the LEA, in accordance with Sec. Sec. 300.125 
and 300.220. The activities undertaken to carry out this responsibility 
for private school children with disabilities must be comparable to 
activities undertaken for children with disabilities in public schools.
    (b) Each LEA shall consult with appropriate representatives of 
private school children with disabilities on

[[Page 55]]

how to carry out the activities described in paragraph (a) of this 
section.

(Authority: 20 U.S.C. 1412(a)(10)(A)(ii))



Sec. 300.452  Provision of services--basic requirement.

    (a) General. To the extent consistent with their number and location 
in the State, provision must be made for the participation of private 
school children with disabilities in the program assisted or carried out 
under Part B of the Act by providing them with special education and 
related services in accordance with Sec. Sec. 300.453-300.462.
    (b) SEA Responsibility--services plan. Each SEA shall ensure that, 
in accordance with paragraph (a) of this section and Sec. Sec. 300.454-
300.456, a services plan is developed and implemented for each private 
school child with a disability who has been designated to receive 
special education and related services under this part.

(Authority: 20 U.S.C. 1412(a)(10)(A)(i))



Sec. 300.453  Expenditures.

    (a) Formula. To meet the requirement of Sec. 300.452(a), each LEA 
must spend on providing special education and related services to 
private school children with disabilities--
    (1) For children aged 3 through 21, an amount that is the same 
proportion of the LEA's total subgrant under section 611(g) of the Act 
as the number of private school children with disabilities aged 3 
through 21 residing in its jurisdiction is to the total number of 
children with disabilities in its jurisdiction aged 3 through 21; and
    (2) For children aged 3 through 5, an amount that is the same 
proportion of the LEA's total subgrant under section 619(g) of the Act 
as the number of private school children with disabilities aged 3 
through 5 residing in its jurisdiction is to the total number of 
children with disabilities in its jurisdiction aged 3 through 5.
    (b) Child count. (1) Each LEA shall--
    (i) Consult with representatives of private school children in 
deciding how to conduct the annual count of the number of private school 
children with disabilities; and
    (ii) Ensure that the count is conducted on December 1 or the last 
Friday of October of each year.
    (2) The child count must be used to determine the amount that the 
LEA must spend on providing special education and related services to 
private school children with disabilities in the next subsequent fiscal 
year.
    (c) Expenditures for child find may not be considered. Expenditures 
for child find activities described in Sec. 300.451 may not be 
considered in determining whether the LEA has met the requirements of 
paragraph (a) of this section.
    (d) Additional services permissible. State and local educational 
agencies are not prohibited from providing services to private school 
children with disabilities in excess of those required by this part, 
consistent with State law or local policy.

(Authority: 20 U.S.C. 1412(a)(10)(A))



Sec. 300.454  Services determined.

    (a) No individual right to special education and related services. 
(1) No private school child with a disability has an individual right to 
receive some or all of the special education and related services that 
the child would receive if enrolled in a public school.
    (2) Decisions about the services that will be provided to private 
school children with disabilities under Sec. Sec. 300.452-300.462, must 
be made in accordance with paragraphs (b), and (c) of this section.
    (b) Consultation with representatives of private school children 
with disabilities. (1) General. Each LEA shall consult, in a timely and 
meaningful way, with appropriate representatives of private school 
children with disabilities in light of the funding under Sec. 300.453, 
the number of private school children with disabilities, the needs of 
private school children with disabilities, and their location to 
decide--
    (i) Which children will receive services under Sec. 300.452;
    (ii) What services will be provided;
    (iii) How and where the services will be provided; and
    (iv) How the services provided will be evaluated.
    (2) Genuine opportunity. Each LEA shall give appropriate 
representatives

[[Page 56]]

of private school children with disabilities a genuine opportunity to 
express their views regarding each matter that is subject to the 
consultation requirements in this section.
    (3) Timing. The consultation required by paragraph (b)(1) of this 
section must occur before the LEA makes any decision that affects the 
opportunities of private school children with disabilities to 
participate in services under Sec. Sec. 300.452-300.462.
    (4) Decisions. The LEA shall make the final decisions with respect 
to the services to be provided to eligible private school children.
    (c) Services plan for each child served under Sec. Sec. 300.450-
300.462. If a child with a disability is enrolled in a religious or 
other private school and will receive special education or related 
services from an LEA, the LEA shall--
    (1) Initiate and conduct meetings to develop, review, and revise a 
services plan for the child, in accordance with Sec. 300.455(b); and
    (2) Ensure that a representative of the religious or other private 
school attends each meeting. If the representative cannot attend, the 
LEA shall use other methods to ensure participation by the private 
school, including individual or conference telephone calls.

(Authority: 1412(a)(10)(A))



Sec. 300.455  Services provided.

    (a) General. (1) The services provided to private school children 
with disabilities must be provided by personnel meeting the same 
standards as personnel providing services in the public schools.
    (2) Private school children with disabilities may receive a 
different amount of services than children with disabilities in public 
schools.
    (3) No private school child with a disability is entitled to any 
service or to any amount of a service the child would receive if 
enrolled in a public school.
    (b) Services provided in accordance with a services plan. (1) Each 
private school child with a disability who has been designated to 
receive services under Sec. 300.452 must have a services plan that 
describes the specific special education and related services that the 
LEA will provide to the child in light of the services that the LEA has 
determined, through the process described in Sec. Sec. 300.453-300.454, 
it will make available to private school children with disabilities.
    (2) The services plan must, to the extent appropriate--
    (i) Meet the requirements of Sec. 300.347, with respect to the 
services provided; and
    (ii) Be developed, reviewed, and revised consistent with Sec. Sec. 
300.342-300.346.

(Authority: 20 U.S.C. 1412(a)(10)(A))



Sec. 300.456  Location of services; transportation.

    (a) On-site. Services provided to private school children with 
disabilities may be provided on-site at a child's private school, 
including a religious school, to the extent consistent with law.
    (b) Transportation. (1) General. (i) If necessary for the child to 
benefit from or participate in the services provided under this part, a 
private school child with a disability must be provided transportation--
    (A) From the child's school or the child's home to a site other than 
the private school; and
    (B) From the service site to the private school, or to the child's 
home, depending on the timing of the services.
    (ii) LEAs are not required to provide transportation from the 
child's home to the private school.
    (2) Cost of transportation. The cost of the transportation described 
in paragraph (b)(1)(i) of this section may be included in calculating 
whether the LEA has met the requirement of Sec. 300.453.

(Authority: 20 U.S.C. 1412(a)(10)(A))



Sec. 300.457  Complaints.

    (a) Due process inapplicable. The procedures in Sec. Sec. 300.504-
300.515 do not apply to complaints that an LEA has failed to meet the 
requirements of Sec. Sec. 300.452-300.462, including the provision of 
services indicated on the child's services plan.
    (b) Due process applicable. The procedures in Sec. Sec. 300.504-
300.515 do apply to complaints that an LEA has failed to

[[Page 57]]

meet the requirements of Sec. 300.451, including the requirements of 
Sec. Sec. 300.530-300.543.
    (c) State complaints. Complaints that an SEA or LEA has failed to 
meet the requirements of Sec. Sec. 300.451-300.462 may be filed under 
the procedures in Sec. Sec. 300.660-300.662.

(Authority: 20 U.S.C. 1412(a)(10)(A))



Sec. 300.458  Separate classes prohibited.

    An LEA may not use funds available under section 611 or 619 of the 
Act for classes that are organized separately on the basis of school 
enrollment or religion of the students if--
    (a) The classes are at the same site; and
    (b) The classes include students enrolled in public schools and 
students enrolled in private schools.

(Authority: 20 U.S.C. 1412(a)(10)(A))



Sec. 300.459  Requirement that funds not benefit a private school.

    (a) An LEA may not use funds provided under section 611 or 619 of 
the Act to finance the existing level of instruction in a private school 
or to otherwise benefit the private school.
    (b) The LEA shall use funds provided under Part B of the Act to meet 
the special education and related services needs of students enrolled in 
private schools, but not for--
    (1) The needs of a private school; or
    (2) The general needs of the students enrolled in the private 
school.

(Authority: 20 U.S.C. 1412(a)(10)(A))



Sec. 300.460  Use of public school personnel.

    An LEA may use funds available under sections 611 and 619 of the Act 
to make public school personnel available in other than public 
facilities--
    (a) To the extent necessary to provide services under Sec. Sec. 
300.450-300.462 for private school children with disabilities; and
    (b) If those services are not normally provided by the private 
school.

(Authority: 20 U.S.C. 1412(a)(10)(A))



Sec. 300.461  Use of private school personnel.

    An LEA may use funds available under section 611 or 619 of the Act 
to pay for the services of an employee of a private school to provide 
services under Sec. Sec. 300.450-300.462 if--
    (a) The employee performs the services outside of his or her regular 
hours of duty; and
    (b) The employee performs the services under public supervision and 
control.

(Authority: 20 U.S.C. 1412(a)(10)(A))



Sec. 300.462  Requirements concerning property, equipment, and supplies 
for the benefit of private school children with disabilities.

    (a) A public agency must keep title to and exercise continuing 
administrative control of all property, equipment, and supplies that the 
public agency acquires with funds under section 611 or 619 of the Act 
for the benefit of private school children with disabilities.
    (b) The public agency may place equipment and supplies in a private 
school for the period of time needed for the program.
    (c) The public agency shall ensure that the equipment and supplies 
placed in a private school--
    (1) Are used only for Part B purposes; and
    (2) Can be removed from the private school without remodeling the 
private school facility.
    (d) The public agency shall remove equipment and supplies from a 
private school if--
    (1) The equipment and supplies are no longer needed for Part B 
purposes; or
    (2) Removal is necessary to avoid unauthorized use of the equipment 
and supplies for other than Part B purposes.
    (e) No funds under Part B of the Act may be used for repairs, minor 
remodeling, or construction of private school facilities.

(Authority: 20 U.S.C. 1412(a)(10)(A))

                         Procedures for By-Pass



Sec. 300.480  By-pass--general.

    (a) The Secretary implements a by-pass if an SEA is, and was on 
December

[[Page 58]]

2, 1983, prohibited by law from providing for the participation of 
private school children with disabilities in the program assisted or 
carried out under Part B of the Act, as required by section 
612(a)(10)(A) of the Act and by Sec. Sec. 300.452-300.462.
    (b) The Secretary waives the requirement of section 612(a)(10)(A) of 
the Act and of Sec. Sec. 300.452-300.462 if the Secretary implements a 
by-pass.

(Authority: 20 U.S.C. 1412(f)(1))



Sec. 300.481  Provisions for services under a by-pass.

    (a) Before implementing a by-pass, the Secretary consults with 
appropriate public and private school officials, including SEA 
officials, in the affected State to consider matters such as--
    (1) The prohibition imposed by State law that results in the need 
for a by-pass;
    (2) The scope and nature of the services required by private school 
children with disabilities in the State, and the number of children to 
be served under the by-pass; and
    (3) The establishment of policies and procedures to ensure that 
private school children with disabilities receive services consistent 
with the requirements of section 612(a)(10)(A) of the Act and Sec. Sec. 
300.452-300.462.
    (b) After determining that a by-pass is required, the Secretary 
arranges for the provision of services to private school children with 
disabilities in the State in a manner consistent with the requirements 
of section 612(a)(10)(A) of the Act and Sec. Sec. 300.452-300.462 by 
providing services through one or more agreements with appropriate 
parties.
    (c) For any fiscal year that a by-pass is implemented, the Secretary 
determines the maximum amount to be paid to the providers of services by 
multiplying--
    (1) A per child amount that may not exceed the amount per child 
provided by the Secretary under Part B of the Act for all children with 
disabilities in the State for the preceding fiscal year; by
    (2) The number of private school children with disabilities (as 
defined by Sec. Sec. 300.7(a) and 300.450) in the State, as determined 
by the Secretary on the basis of the most recent satisfactory data 
available, which may include an estimate of the number of those children 
with disabilities.
    (d) The Secretary deducts from the State's allocation under Part B 
of the Act the amount the Secretary determines is necessary to implement 
a by-pass and pays that amount to the provider of services. The 
Secretary may withhold this amount from the State's allocation pending 
final resolution of any investigation or complaint that could result in 
a determination that a by-pass must be implemented.

(Authority: 20 U.S.C. 1412(f)(2))



Sec. 300.482  Notice of intent to implement a by-pass.

    (a) Before taking any final action to implement a by-pass, the 
Secretary provides the affected SEA with written notice.
    (b) In the written notice, the Secretary--
    (1) States the reasons for the proposed by-pass in sufficient detail 
to allow the SEA to respond; and
    (2) Advises the SEA that it has a specific period of time (at least 
45 days) from receipt of the written notice to submit written objections 
to the proposed by-pass and that it may request in writing the 
opportunity for a hearing to show cause why a by-pass should not be 
implemented.
    (c) The Secretary sends the notice to the SEA by certified mail with 
return receipt requested.

(Authority: 20 U.S.C. 1412(f)(3)(A))



Sec. 300.483  Request to show cause.

    An SEA seeking an opportunity to show cause why a by-pass should not 
be implemented shall submit a written request for a show cause hearing 
to the Secretary.

(Authority: 20 U.S.C. 1412(f)(3))



Sec. 300.484  Show cause hearing.

    (a) If a show cause hearing is requested, the Secretary--
    (1) Notifies the SEA and other appropriate public and private school 
officials of the time and place for the hearing; and
    (2) Designates a person to conduct the show cause hearing. The 
designee

[[Page 59]]

must not have had any responsibility for the matter brought for a 
hearing.
    (b) At the show cause hearing, the designee considers matters such 
as--
    (1) The necessity for implementing a by-pass;
    (2) Possible factual errors in the written notice of intent to 
implement a by-pass; and
    (3) The objections raised by public and private school 
representatives.
    (c) The designee may regulate the course of the proceedings and the 
conduct of parties during the pendency of the proceedings. The designee 
takes all steps necessary to conduct a fair and impartial proceeding, to 
avoid delay, and to maintain order.
    (d) The designee may interpret applicable statutes and regulations, 
but may not waive them or rule on their validity.
    (e) The designee arranges for the preparation, retention, and, if 
appropriate, dissemination of the record of the hearing.

(Authority: 20 U.S.C. 1412(f)(3))



Sec. 300.485  Decision.

    (a) The designee who conducts the show cause hearing--
    (1) Issues a written decision that includes a statement of findings; 
and
    (2) Submits a copy of the decision to the Secretary and sends a copy 
to each party by certified mail with return receipt requested.
    (b) Each party may submit comments and recommendations on the 
designee's decision to the Secretary within 15 days of the date the 
party receives the designee's decision.
    (c) The Secretary adopts, reverses, or modifies the designee's 
decision and notifies the SEA of the Secretary's final action. That 
notice is sent by certified mail with return receipt requested.

(Authority: 20 U.S.C. 1412(f)(3))



Sec. 300.486  Filing requirements.

    (a) Any written submission under Sec. Sec. 300.482-300.485 must be 
filed by hand-delivery, by mail, or by facsimile transmission. The 
Secretary discourages the use of facsimile transmission for documents 
longer than five pages.
    (b) The filing date under paragraph (a) of this section is the date 
the document is--
    (1) Hand-delivered;
    (2) Mailed; or
    (3) Sent by facsimile transmission.
    (c) A party filing by facsimile transmission is responsible for 
confirming that a complete and legible copy of the document was received 
by the Department.
    (d) If a document is filed by facsimile transmission, the Secretary 
or the hearing officer, as applicable, may require the filing of a 
follow-up hard copy by hand-delivery or by mail within a reasonable 
period of time.
    (e) If agreed upon by the parties, service of a document may be made 
upon the other party by facsimile transmission.

(Authority: 20 U.S.C. 1412(f)(3))



Sec. 300.487  Judicial review.

    If dissatisfied with the Secretary's final action, the SEA may, 
within 60 days after notice of that action, file a petition for review 
with the United States Court of Appeals for the circuit in which the 
State is located. The procedures for judicial review are described in 
section 612(f)(3)(B)-(D) of the Act.

(Authority: 20 U.S.C. 1412(f)(3)(B)-(D))



                     Subpart E_Procedural Safeguards

             Due Process Procedures for Parents and Children



Sec. 300.500  General responsibility of public agencies; definitions.

    (a) Responsibility of SEA and other public agencies. Each SEA shall 
ensure that each public agency establishes, maintains, and implements 
procedural safeguards that meet the requirements of Sec. Sec. 300.500-
300.529.
    (b) Definitions of ``consent,'' ``evaluation,'' and ``personally 
identifiable.'' As used in this part --
    (1) Consent means that --
    (i) The parent has been fully informed of all information relevant 
to the activity for which consent is sought, in his or her native 
language, or other mode of communication;

[[Page 60]]

    (ii) The parent understands and agrees in writing to the carrying 
out of the activity for which his or her consent is sought, and the 
consent describes that activity and lists the records (if any) that will 
be released and to whom; and
    (iii)(A) The parent understands that the granting of consent is 
voluntary on the part of the parent and may be revoked at anytime.
    (B) If a parent revokes consent, that revocation is not retroactive 
(i.e., it does not negate an action that has occurred after the consent 
was given and before the consent was revoked).
    (2) Evaluation means procedures used in accordance with Sec. Sec. 
300.530-300.536 to determine whether a child has a disability and the 
nature and extent of the special education and related services that the 
child needs; and
    (3) Personally identifiable means that information includes--
    (i) The name of the child, the child's parent, or other family 
member;
    (ii) The address of the child;
    (iii) A personal identifier, such as the child's social security 
number or student number; or
    (iv) A list of personal characteristics or other information that 
would make it possible to identify the child with reasonable certainty.

(Authority: 20 U.S.C. 1415(a))



Sec. 300.501  Opportunity to examine records; parent participation in 
meetings.

    (a) General. The parents of a child with a disability must be 
afforded, in accordance with the procedures of Sec. Sec. 300.562-
300.569, an opportunity to--
    (1) Inspect and review all education records with respect to--
    (i) The identification, evaluation, and educational placement of the 
child; and
    (ii) The provision of FAPE to the child; and
    (2) Participate in meetings with respect to --
    (i) The identification, evaluation, and educational placement of the 
child; and
    (ii) The provision of FAPE to the child.
    (b) Parent participation in meetings. (1) Each public agency shall 
provide notice consistent with Sec. 300.345(a)(1) and (b)(1) to ensure 
that parents of children with disabilities have the opportunity to 
participate in meetings described in paragraph (a)(2) of this section.
    (2) A meeting does not include informal or unscheduled conversations 
involving public agency personnel and conversations on issues such as 
teaching methodology, lesson plans, or coordination of service provision 
if those issues are not addressed in the child's IEP. A meeting also 
does not include preparatory activities that public agency personnel 
engage in to develop a proposal or response to a parent proposal that 
will be discussed at a later meeting.
    (c) Parent involvement in placement decisions. (1) Each public 
agency shall ensure that the parents of each child with a disability are 
members of any group that makes decisions on the educational placement 
of their child.
    (2) In implementing the requirements of paragraph (c)(1) of this 
section, the public agency shall use procedures consistent with the 
procedures described in Sec. 300.345(a) through (b)(1).
    (3) If neither parent can participate in a meeting in which a 
decision is to be made relating to the educational placement of their 
child, the public agency shall use other methods to ensure their 
participation, including individual or conference telephone calls, or 
video conferencing.
    (4) A placement decision may be made by a group without the 
involvement of the parents, if the public agency is unable to obtain the 
parents' participation in the decision. In this case, the public agency 
must have a record of its attempt to ensure their involvement, including 
information that is consistent with the requirements of Sec. 
300.345(d).
    (5) The public agency shall make reasonable efforts to ensure that 
the parents understand, and are able to participate in, any group 
discussions relating to the educational placement of their child, 
including arranging for an interpreter for parents with deafness, or 
whose native language is other than English.

(Authority: 20 U.S.C. 1414(f), 1415(b)(1))

[[Page 61]]



Sec. 300.502  Independent educational evaluation.

    (a) General. (1) The parents of a child with a disability have the 
right under this part to obtain an independent educational evaluation of 
the child, subject to paragraphs (b) through (e) of this section.
    (2) Each public agency shall provide to parents, upon request for an 
independent educational evaluation, information about where an 
independent educational evaluation may be obtained, and the agency 
criteria applicable for independent educational evaluations as set forth 
in paragraph (e) of this section.
    (3) For the purposes of this part--
    (i) Independent educational evaluation means an evaluation conducted 
by a qualified examiner who is not employed by the public agency 
responsible for the education of the child in question; and
    (ii) Public expense means that the public agency either pays for the 
full cost of the evaluation or ensures that the evaluation is otherwise 
provided at no cost to the parent, consistent with Sec. 300.301.
    (b) Parent right to evaluation at public expense. (1) A parent has 
the right to an independent educational evaluation at public expense if 
the parent disagrees with an evaluation obtained by the public agency.
    (2) If a parent requests an independent educational evaluation at 
public expense, the public agency must, without unnecessary delay, 
either--
    (i) Initiate a hearing under Sec. 300.507 to show that its 
evaluation is appropriate; or
    (ii) Ensure that an independent educational evaluation is provided 
at public expense, unless the agency demonstrates in a hearing under 
Sec. 300.507 that the evaluation obtained by the parent did not meet 
agency criteria.
    (3) If the public agency initiates a hearing and the final decision 
is that the agency's evaluation is appropriate, the parent still has the 
right to an independent educational evaluation, but not at public 
expense.
    (4) If a parent requests an independent educational evaluation, the 
public agency may ask for the parent's reason why he or she objects to 
the public evaluation. However, the explanation by the parent may not be 
required and the public agency may not unreasonably delay either 
providing the independent educational evaluation at public expense or 
initiating a due process hearing to defend the public evaluation.
    (c) Parent-initiated evaluations. If the parent obtains an 
independent educational evaluation at private expense, the results of 
the evaluation--
    (1) Must be considered by the public agency, if it meets agency 
criteria, in any decision made with respect to the provision of FAPE to 
the child; and
    (2) May be presented as evidence at a hearing under this subpart 
regarding that child.
    (d) Requests for evaluations by hearing officers. If a hearing 
officer requests an independent educational evaluation as part of a 
hearing, the cost of the evaluation must be at public expense.
    (e) Agency criteria. (1) If an independent educational evaluation is 
at public expense, the criteria under which the evaluation is obtained, 
including the location of the evaluation and the qualifications of the 
examiner, must be the same as the criteria that the public agency uses 
when it initiates an evaluation, to the extent those criteria are 
consistent with the parent's right to an independent educational 
evaluation.
    (2) Except for the criteria described in paragraph (e)(1) of this 
section, a public agency may not impose conditions or timelines related 
to obtaining an independent educational evaluation at public expense.

(Authority: 20 U.S.C. 1415(b)(1))



Sec. 300.503  Prior notice by the public agency; content of notice.

    (a) Notice. (1) Written notice that meets the requirements of 
paragraph (b) of this section must be given to the parents of a child 
with a disability a reasonable time before the public agency--
    (i) Proposes to initiate or change the identification, evaluation, 
or educational placement of the child or the provision of FAPE to the 
child; or

[[Page 62]]

    (ii) Refuses to initiate or change the identification, evaluation, 
or educational placement of the child or the provision of FAPE to the 
child.
    (2) If the notice described under paragraph (a)(1) of this section 
relates to an action proposed by the public agency that also requires 
parental consent under Sec. 300.505, the agency may give notice at the 
same time it requests parent consent.
    (b) Content of notice. The notice required under paragraph (a) of 
this section must include--
    (1) A description of the action proposed or refused by the agency;
    (2) An explanation of why the agency proposes or refuses to take the 
action;
    (3) A description of any other options that the agency considered 
and the reasons why those options were rejected;
    (4) A description of each evaluation procedure, test, record, or 
report the agency used as a basis for the proposed or refused action;
    (5) A description of any other factors that are relevant to the 
agency's proposal or refusal;
    (6) A statement that the parents of a child with a disability have 
protection under the procedural safeguards of this part and, if this 
notice is not an initial referral for evaluation, the means by which a 
copy of a description of the procedural safeguards can be obtained; and
    (7) Sources for parents to contact to obtain assistance in 
understanding the provisions of this part.
    (c) Notice in understandable language. (1) The notice required under 
paragraph (a) of this section must be--
    (i) Written in language understandable to the general public; and
    (ii) Provided in the native language of the parent or other mode of 
communication used by the parent, unless it is clearly not feasible to 
do so.
    (2) If the native language or other mode of communication of the 
parent is not a written language, the public agency shall take steps to 
ensure--
    (i) That the notice is translated orally or by other means to the 
parent in his or her native language or other mode of communication;
    (ii) That the parent understands the content of the notice; and
    (iii) That there is written evidence that the requirements in 
paragraphs (c)(2) (i) and (ii) of this section have been met.

(Authority: 20 U.S.C. 1415(b)(3), (4) and (c), 1414(b)(1))



Sec. 300.504  Procedural safeguards notice.

    (a) General. A copy of the procedural safeguards available to the 
parents of a child with a disability must be given to the parents, at a 
minimum--
    (1) Upon initial referral for evaluation;
    (2) Upon each notification of an IEP meeting;
    (3) Upon reevaluation of the child; and
    (4) Upon receipt of a request for due process under Sec. 300.507.
    (b) Contents. The procedural safeguards notice must include a full 
explanation of all of the procedural safeguards available under 
Sec. Sec. 300.403, 300.500-300.529, and 300.560-300.577, and the State 
complaint procedures available under Sec. Sec. 300.660-300.662 relating 
to--
    (1) Independent educational evaluation;
    (2) Prior written notice;
    (3) Parental consent;
    (4) Access to educational records;
    (5) Opportunity to present complaints to initiate due process 
hearings;
    (6) The child's placement during pendency of due process 
proceedings;
    (7) Procedures for students who are subject to placement in an 
interim alternative educational setting;
    (8) Requirements for unilateral placement by parents of children in 
private schools at public expense;
    (9) Mediation;
    (10) Due process hearings, including requirements for disclosure of 
evaluation results and recommendations;
    (11) State-level appeals (if applicable in that State);
    (12) Civil actions;
    (13) Attorneys' fees; and
    (14) The State complaint procedures under Sec. Sec. 300.660-
300.662, including a description of how to file a complaint and the 
timelines under those procedures.
    (c) Notice in understandable language. The notice required under 
paragraph

[[Page 63]]

(a) of this section must meet the requirements of Sec. 300.503(c).

(Authority: 20 U.S.C. 1415(d))



Sec. 300.505  Parental consent.

    (a) General. (1) Subject to paragraphs (a)(3), (b) and (c) of this 
section, informed parent consent must be obtained before--
    (i) Conducting an initial evaluation or reevaluation; and
    (ii) Initial provision of special education and related services to 
a child with a disability.
    (2) Consent for initial evaluation may not be construed as consent 
for initial placement described in paragraph (a)(1)(ii) of this section.
    (3) Parental consent is not required before--
    (i) Reviewing existing data as part of an evaluation or a 
reevaluation; or
    (ii) Administering a test or other evaluation that is administered 
to all children unless, before administration of that test or 
evaluation, consent is required of parents of all children.
    (b) Refusal. If the parents of a child with a disability refuse 
consent for initial evaluation or a reevaluation, the agency may 
continue to pursue those evaluations by using the due process procedures 
under Sec. Sec. 300.507-300.509, or the mediation procedures under 
Sec. 300.506 if appropriate, except to the extent inconsistent with 
State law relating to parental consent.
    (c) Failure to respond to request for reevaluation. (1) Informed 
parental consent need not be obtained for reevaluation if the public 
agency can demonstrate that it has taken reasonable measures to obtain 
that consent, and the child's parent has failed to respond.
    (2) To meet the reasonable measures requirement in paragraph (c)(1) 
of this section, the public agency must use procedures consistent with 
those in Sec. 300.345(d).
    (d) Additional State consent requirements. In addition to the 
parental consent requirements described in paragraph (a) of this 
section, a State may require parental consent for other services and 
activities under this part if it ensures that each public agency in the 
State establishes and implements effective procedures to ensure that a 
parent's refusal to consent does not result in a failure to provide the 
child with FAPE.
    (e) Limitation. A public agency may not use a parent's refusal to 
consent to one service or activity under paragraphs (a) and (d) of this 
section to deny the parent or child any other service, benefit, or 
activity of the public agency, except as required by this part.

(Authority: 20 U.S.C. 1415(b)(3); 1414(a)(1)(C) and (c)(3))



Sec. 300.506  Mediation.

    (a) General. Each public agency shall ensure that procedures are 
established and implemented to allow parties to disputes involving any 
matter described in Sec. 300.503(a)(1) to resolve the disputes through 
a mediation process that, at a minimum, must be available whenever a 
hearing is requested under Sec. Sec. 300.507 or 300.520-300.528.
    (b) Requirements. The procedures must meet the following 
requirements:
    (1) The procedures must ensure that the mediation process--
    (i) Is voluntary on the part of the parties;
    (ii) Is not used to deny or delay a parent's right to a due process 
hearing under Sec. 300.507, or to deny any other rights afforded under 
Part B of the Act; and
    (iii) Is conducted by a qualified and impartial mediator who is 
trained in effective mediation techniques.
    (2)(i) The State shall maintain a list of individuals who are 
qualified mediators and knowledgeable in laws and regulations relating 
to the provision of special education and related services.
    (ii) If a mediator is not selected on a random (e.g., a rotation) 
basis from the list described in paragraph (b)(2)(i) of this section, 
both parties must be involved in selecting the mediator and agree with 
the selection of the individual who will mediate.
    (3) The State shall bear the cost of the mediation process, 
including the costs of meetings described in paragraph (d) of this 
section.
    (4) Each session in the mediation process must be scheduled in a 
timely manner and must be held in a location that is convenient to the 
parties to the dispute.

[[Page 64]]

    (5) An agreement reached by the parties to the dispute in the 
mediation process must be set forth in a written mediation agreement.
    (6) Discussions that occur during the mediation process must be 
confidential and may not be used as evidence in any subsequent due 
process hearings or civil proceedings, and the parties to the mediation 
process may be required to sign a confidentiality pledge prior to the 
commencement of the process.
    (c) Impartiality of mediator. (1) An individual who serves as a 
mediator under this part--
    (i) May not be an employee of--
    (A) Any LEA or any State agency described under Sec. 300.194; or
    (B) An SEA that is providing direct services to a child who is the 
subject of the mediation process; and
    (ii) Must not have a personal or professional conflict of interest.
    (2) A person who otherwise qualifies as a mediator is not an 
employee of an LEA or State agency described under Sec. 300.194 solely 
because he or she is paid by the agency to serve as a mediator.
    (d) Meeting to encourage mediation. (1) A public agency may 
establish procedures to require parents who elect not to use the 
mediation process to meet, at a time and location convenient to the 
parents, with a disinterested party--
    (i) Who is under contract with a parent training and information 
center or community parent resource center in the State established 
under section 682 or 683 of the Act, or an appropriate alternative 
dispute resolution entity; and
    (ii) Who would explain the benefits of the mediation process, and 
encourage the parents to use the process.
    (2) A public agency may not deny or delay a parent's right to a due 
process hearing under Sec. 300.507 if the parent fails to participate 
in the meeting described in paragraph (d)(1) of this section.

(Authority: 20 U.S.C. 1415(e))



Sec. 300.507  Impartial due process hearing; parent notice.

    (a) General. (1) A parent or a public agency may initiate a hearing 
on any of the matters described in Sec. 300.503(a)(1) and (2) (relating 
to the identification, evaluation or educational placement of a child 
with a disability, or the provision of FAPE to the child).
    (2) When a hearing is initiated under paragraph (a)(1) of this 
section, the public agency shall inform the parents of the availability 
of mediation described in Sec. 300.506.
    (3) The public agency shall inform the parent of any free or low-
cost legal and other relevant services available in the area if--
    (i) The parent requests the information; or
    (ii) The parent or the agency initiates a hearing under this 
section.
    (b) Agency responsible for conducting hearing. The hearing described 
in paragraph (a) of this section must be conducted by the SEA or the 
public agency directly responsible for the education of the child, as 
determined under State statute, State regulation, or a written policy of 
the SEA.
    (c) Parent notice to the public agency. (1) General. The public 
agency must have procedures that require the parent of a child with a 
disability or the attorney representing the child, to provide notice 
(which must remain confidential) to the public agency in a request for a 
hearing under paragraph (a)(1) of this section.
    (2) Content of parent notice. The notice required in paragraph 
(c)(1) of this section must include--
    (i) The name of the child;
    (ii) The address of the residence of the child;
    (iii) The name of the school the child is attending;
    (iv) A description of the nature of the problem of the child 
relating to the proposed or refused initiation or change, including 
facts relating to the problem; and
    (v) A proposed resolution of the problem to the extent known and 
available to the parents at the time.
    (3) Model form to assist parents. Each SEA shall develop a model 
form to assist parents in filing a request for due process that includes 
the information required in paragraphs (c)(1) and (2) of this section.
    (4) Right to due process hearing. A public agency may not deny or 
delay a parent's right to a due process hearing for

[[Page 65]]

failure to provide the notice required in paragraphs (c)(1) and (2) of 
this section.

(Authority: 20 U.S.C. 1415(b)(5), (b)(6), (b)(7), (b)(8), (e)(1) and 
(f)(1))



Sec. 300.508  Impartial hearing officer.

    (a) A hearing may not be conducted--
    (1) By a person who is an employee of the State agency or the LEA 
that is involved in the education or care of the child; or
    (2) By any person having a personal or professional interest that 
would conflict with his or her objectivity in the hearing.
    (b) A person who otherwise qualifies to conduct a hearing under 
paragraph (a) of this section is not an employee of the agency solely 
because he or she is paid by the agency to serve as a hearing officer.
    (c) Each public agency shall keep a list of the persons who serve as 
hearing officers. The list must include a statement of the 
qualifications of each of those persons.

(Authority: 20 U.S.C. 1415(f)(3))



Sec. 300.509  Hearing rights.

    (a) General. Any party to a hearing conducted pursuant to Sec. Sec. 
300.507 or 300.520-300.528, or an appeal conducted pursuant to Sec. 
300.510, has the right to--
    (1) Be accompanied and advised by counsel and by individuals with 
special knowledge or training with respect to the problems of children 
with disabilities;
    (2) Present evidence and confront, cross-examine, and compel the 
attendance of witnesses;
    (3) Prohibit the introduction of any evidence at the hearing that 
has not been disclosed to that party at least 5 business days before the 
hearing;
    (4) Obtain a written, or, at the option of the parents, electronic, 
verbatim record of the hearing; and
    (5) Obtain written, or, at the option of the parents, electronic 
findings of fact and decisions.
    (b) Additional disclosure of information. (1) At least 5 business 
days prior to a hearing conducted pursuant to Sec. 300.507(a), each 
party shall disclose to all other parties all evaluations completed by 
that date and recommendations based on the offering party's evaluations 
that the party intends to use at the hearing.
    (2) A hearing officer may bar any party that fails to comply with 
paragraph (b)(1) of this section from introducing the relevant 
evaluation or recommendation at the hearing without the consent of the 
other party.
    (c) Parental rights at hearings. (1) Parents involved in hearings 
must be given the right to--
    (i) Have the child who is the subject of the hearing present; and
    (ii) Open the hearing to the public.
    (2) The record of the hearing and the findings of fact and decisions 
described in paragraphs (a)(4) and (a)(5) of this section must be 
provided at no cost to parents.
    (d) Findings and decision to advisory panel and general public. The 
public agency, after deleting any personally identifiable information, 
shall --
    (1) Transmit the findings and decisions referred to in paragraph 
(a)(5) of this section to the State advisory panel established under 
Sec. 300.650; and
    (2) Make those findings and decisions available to the public.

(Authority: 20 U.S.C. 1415(f)(2) and (h))



Sec. 300.510  Finality of decision; appeal; impartial review.

    (a) Finality of decision. A decision made in a hearing conducted 
pursuant to Sec. Sec. 300.507 or 300.520-300.528 is final, except that 
any party involved in the hearing may appeal the decision under the 
provisions of paragraph (b) of this section and Sec. 300.512.


(Authority: 20 U.S.C. 1415(i)(1)(A))

    (b) Appeal of decisions; impartial review. (1) General. If the 
hearing required by Sec. 300.507 is conducted by a public agency other 
than the SEA, any party aggrieved by the findings and decision in the 
hearing may appeal to the SEA.
    (2) SEA responsibility for review. If there is an appeal, the SEA 
shall conduct an impartial review of the hearing. The official 
conducting the review shall--
    (i) Examine the entire hearing record;

[[Page 66]]

    (ii) Ensure that the procedures at the hearing were consistent with 
the requirements of due process;
    (iii) Seek additional evidence if necessary. If a hearing is held to 
receive additional evidence, the rights in Sec. 300.509 apply;
    (iv) Afford the parties an opportunity for oral or written argument, 
or both, at the discretion of the reviewing official;
    (v) Make an independent decision on completion of the review; and
    (vi) Give a copy of the written, or, at the option of the parents, 
electronic findings of fact and decisions to the parties.
    (c) Findings and decision to advisory panel and general public. The 
SEA, after deleting any personally identifiable information, shall--
    (1) Transmit the findings and decisions referred to in paragraph 
(b)(2)(vi) of this section to the State advisory panel established under 
Sec. 300.650; and
    (2) Make those findings and decisions available to the public.
    (d) Finality of review decision. The decision made by the reviewing 
official is final unless a party brings a civil action under Sec. 
300.512.

(Authority: 20 U.S.C. 1415(g); H. R. Rep. No. 94-664, at p. 49 (1975))



Sec. 300.511  Timelines and convenience of hearings and reviews.

    (a) The public agency shall ensure that not later than 45 days after 
the receipt of a request for a hearing--
    (1) A final decision is reached in the hearing; and
    (2) A copy of the decision is mailed to each of the parties.
    (b) The SEA shall ensure that not later than 30 days after the 
receipt of a request for a review--
    (1) A final decision is reached in the review; and
    (2) A copy of the decision is mailed to each of the parties.
    (c) A hearing or reviewing officer may grant specific extensions of 
time beyond the periods set out in paragraphs (a) and (b) of this 
section at the request of either party.
    (d) Each hearing and each review involving oral arguments must be 
conducted at a time and place that is reasonably convenient to the 
parents and child involved.

(Authority: 20 U.S.C. 1415)



Sec. 300.512  Civil action.

    (a) General. Any party aggrieved by the findings and decision made 
under Sec. Sec. 300.507 or 300.520-300.528 who does not have the right 
to an appeal under Sec. 300.510(b), and any party aggrieved by the 
findings and decision under Sec. 300.510(b), has the right to bring a 
civil action with respect to the complaint presented pursuant to Sec. 
300.507. The action may be brought in any State court of competent 
jurisdiction or in a district court of the United States without regard 
to the amount in controversy.
    (b) Additional requirements. In any action brought under paragraph 
(a) of this section, the court--
    (1) Shall receive the records of the administrative proceedings;
    (2) Shall hear additional evidence at the request of a party; and
    (3) Basing its decision on the preponderance of the evidence, shall 
grant the relief that the court determines to be appropriate.
    (c) Jurisdiction of district courts. The district courts of the 
United States have jurisdiction of actions brought under section 615 of 
the Act without regard to the amount in controversy.
    (d) Rule of construction. Nothing in this part restricts or limits 
the rights, procedures, and remedies available under the Constitution, 
the Americans with Disabilities Act of 1990, title V of the 
Rehabilitation Act of 1973, or other Federal laws protecting the rights 
of children with disabilities, except that before the filing of a civil 
action under these laws seeking relief that is also available under 
section 615 of the Act, the procedures under Sec. Sec. 300.507 and 
300.510 must be exhausted to the same extent as would be required had 
the action been brought under section 615 of the Act.

(Authority: 20 U.S.C. 1415(i)(2), (i)(3)(A), and 1415(l))



Sec. 300.513  Attorneys' fees.

    (a) In any action or proceeding brought under section 615 of the 
Act, the court, in its discretion, may award

[[Page 67]]

reasonable attorneys' fees as part of the costs to the parents of a 
child with a disability who is the prevailing party.
    (b)(1) Funds under Part B of the Act may not be used to pay 
attorneys' fees or costs of a party related to an action or proceeding 
under section 615 of the Act and subpart E of this part.
    (2) Paragraph (b)(1) of this section does not preclude a public 
agency from using funds under Part B of the Act for conducting an action 
or proceeding under section 615 of the Act.
    (c) A court awards reasonable attorney's fees under section 
615(i)(3) of the Act consistent with the following:
    (1) Determination of amount of attorneys' fees. Fees awarded under 
section 615(i)(3) of the Act must be based on rates prevailing in the 
community in which the action or proceeding arose for the kind and 
quality of services furnished. No bonus or multiplier may be used in 
calculating the fees awarded under this subsection.
    (2) Prohibition of attorneys' fees and related costs for certain 
services. (i) Attorneys' fees may not be awarded and related costs may 
not be reimbursed in any action or proceeding under section 615 of the 
Act for services performed subsequent to the time of a written offer of 
settlement to a parent if--
    (A) The offer is made within the time prescribed by Rule 68 of the 
Federal Rules of Civil Procedure or, in the case of an administrative 
proceeding, at any time more than 10 days before the proceeding begins;
    (B) The offer is not accepted within 10 days; and
    (C) The court or administrative hearing officer finds that the 
relief finally obtained by the parents is not more favorable to the 
parents than the offer of settlement.
    (ii) Attorneys' fees may not be awarded relating to any meeting of 
the IEP team unless the meeting is convened as a result of an 
administrative proceeding or judicial action, or at the discretion of 
the State, for a mediation described in Sec. 300.506 that is conducted 
prior to the filing of a request for due process under Sec. Sec. 
300.507 or 300.520-300.528.
    (3) Exception to prohibition on attorneys' fees and related costs. 
Notwithstanding paragraph (c)(2) of this section, an award of attorneys' 
fees and related costs may be made to a parent who is the prevailing 
party and who was substantially justified in rejecting the settlement 
offer.
    (4) Reduction of amount of attorneys' fees. Except as provided in 
paragraph (c)(5) of this section, the court reduces, accordingly, the 
amount of the attorneys' fees awarded under section 615 of the Act, if 
the court finds that--
    (i) The parent, during the course of the action or proceeding, 
unreasonably protracted the final resolution of the controversy;
    (ii) The amount of the attorneys' fees otherwise authorized to be 
awarded unreasonably exceeds the hourly rate prevailing in the community 
for similar services by attorneys of reasonably comparable skill, 
reputation, and experience;
    (iii) The time spent and legal services furnished were excessive 
considering the nature of the action or proceeding; or
    (iv) The attorney representing the parent did not provide to the 
school district the appropriate information in the due process complaint 
in accordance with Sec. 300.507(c).
    (5) Exception to reduction in amount of attorneys' fees. The 
provisions of paragraph (c)(4) of this section do not apply in any 
action or proceeding if the court finds that the State or local agency 
unreasonably protracted the final resolution of the action or proceeding 
or there was a violation of section 615 of the Act.

(Authority: 20 U.S.C. 1415(i)(3)(B)-(G))



Sec. 300.514  Child's status during proceedings.

    (a) Except as provided in Sec. 300.526, during the pendency of any 
administrative or judicial proceeding regarding a complaint under Sec. 
300.507, unless the State or local agency and the parents of the child 
agree otherwise, the child involved in the complaint must remain in his 
or her current educational placement.
    (b) If the complaint involves an application for initial admission 
to public school, the child, with the consent of

[[Page 68]]

the parents, must be placed in the public school until the completion of 
all the proceedings.
    (c) If the decision of a hearing officer in a due process hearing 
conducted by the SEA or a State review official in an administrative 
appeal agrees with the child's parents that a change of placement is 
appropriate, that placement must be treated as an agreement between the 
State or local agency and the parents for purposes of paragraph (a) of 
this section.

(Authority: 20 U.S.C. 1415(j))



Sec. 300.515  Surrogate parents.

    (a) General. Each public agency shall ensure that the rights of a 
child are protected if--
    (1) No parent (as defined in Sec. 300.20) can be identified;
    (2) The public agency, after reasonable efforts, cannot discover the 
whereabouts of a parent; or
    (3) The child is a ward of the State under the laws of that State.
    (b) Duty of public agency. The duty of a public agency under 
paragraph (a) of this section includes the assignment of an individual 
to act as a surrogate for the parents. This must include a method--
    (1) For determining whether a child needs a surrogate parent; and
    (2) For assigning a surrogate parent to the child.
    (c) Criteria for selection of surrogates. (1) The public agency may 
select a surrogate parent in any way permitted under State law.
    (2) Except as provided in paragraph (c)(3) of this section, public 
agencies shall ensure that a person selected as a surrogate--
    (i) Is not an employee of the SEA, the LEA, or any other agency that 
is involved in the education or care of the child;
    (ii) Has no interest that conflicts with the interest of the child 
he or she represents; and
    (iii) Has knowledge and skills that ensure adequate representation 
of the child.
    (3) A public agency may select as a surrogate a person who is an 
employee of a nonpublic agency that only provides non-educational care 
for the child and who meets the standards in paragraphs (c)(2)(ii) and 
(iii) of this section.
    (d) Non-employee requirement; compensation. A person who otherwise 
qualifies to be a surrogate parent under paragraph (c) of this section 
is not an employee of the agency solely because he or she is paid by the 
agency to serve as a surrogate parent.
    (e) Responsibilities. The surrogate parent may represent the child 
in all matters relating to--
    (1) The identification, evaluation, and educational placement of the 
child; and
    (2) The provision of FAPE to the child.

(Authority: 20 U.S.C. 1415(b)(2))



Sec. 300.516  [Reserved]



Sec. 300.517  Transfer of parental rights at age of majority.

    (a) General. A State may provide that, when a student with a 
disability reaches the age of majority under State law that applies to 
all students (except for a student with a disability who has been 
determined to be incompetent under State law)--
    (1)(i) The public agency shall provide any notice required by this 
part to both the individual and the parents; and
    (ii) All other rights accorded to parents under Part B of the Act 
transfer to the student; and
    (2) All rights accorded to parents under Part B of the Act transfer 
to students who are incarcerated in an adult or juvenile, State or local 
correctional institution.
    (3) Whenever a State transfers rights under this part pursuant to 
paragraph (a)(1) or (a)(2) of this section, the agency shall notify the 
individual and the parents of the transfer of rights.
    (b) Special rule. If, under State law, a State has a mechanism to 
determine that a student with a disability, who has reached the age of 
majority under State law that applies to all children and has not been 
determined incompetent under State law, does not have the ability to 
provide informed consent with respect to his or her educational program, 
the State shall establish procedures for appointing the parent, or, if

[[Page 69]]

the parent is not available another appropriate individual, to represent 
the educational interests of the student throughout the student's 
eligibility under Part B of the Act.

(Authority: 20 U.S.C. 1415(m))

                          Discipline Procedures



Sec. 300.519  Change of placement for disciplinary removals.

    For purposes of removals of a child with a disability from the 
child's current educational placement under Sec. Sec. 300.520-300.529, 
a change of placement occurs if--
    (a) The removal is for more than 10 consecutive school days; or
    (b) The child is subjected to a series of removals that constitute a 
pattern because they cumulate to more than 10 school days in a school 
year, and because of factors such as the length of each removal, the 
total amount of time the child is removed, and the proximity of the 
removals to one another.

(Authority: 20 U.S.C. 1415(k))



Sec. 300.520  Authority of school personnel.

    (a) School personnel may order--
    (1)(i) To the extent removal would be applied to children without 
disabilities, the removal of a child with a disability from the child's 
current placement for not more than 10 consecutive school days for any 
violation of school rules, and additional removals of not more than 10 
consecutive school days in that same school year for separate incidents 
of misconduct (as long as those removals do not constitute a change of 
placement under Sec. 300.519(b));
    (ii) After a child with a disability has been removed from his or 
her current placement for more than 10 school days in the same school 
year, during any subsequent days of removal the public agency must 
provide services to the extent required under Sec. 300.121(d); and
    (2) A change in placement of a child with a disability to an 
appropriate interim alternative educational setting for the same amount 
of time that a child without a disability would be subject to 
discipline, but for not more than 45 days, if--
    (i) The child carries a weapon to school or to a school function 
under the jurisdiction of a State or a local educational agency; or
    (ii) The child knowingly possesses or uses illegal drugs or sells or 
solicits the sale of a controlled substance while at school or a school 
function under the jurisdiction of a State or local educational agency.
    (b)(1) Either before or not later than 10 business days after either 
first removing the child for more than 10 school days in a school year 
or commencing a removal that constitutes a change of placement under 
Sec. 300.519, including the action described in paragraph (a)(2) of 
this section--
    (i) If the LEA did not conduct a functional behavioral assessment 
and implement a behavioral intervention plan for the child before the 
behavior that resulted in the removal described in paragraph (a) of this 
section, the agency shall convene an IEP meeting to develop an 
assessment plan.
    (ii) If the child already has a behavioral intervention plan, the 
IEP team shall meet to review the plan and its implementation, and, 
modify the plan and its implementation as necessary, to address the 
behavior.
    (2) As soon as practicable after developing the plan described in 
paragraph (b)(1)(i) of this section, and completing the assessments 
required by the plan, the LEA shall convene an IEP meeting to develop 
appropriate behavioral interventions to address that behavior and shall 
implement those interventions.
    (c)(1) If subsequently, a child with a disability who has a 
behavioral intervention plan and who has been removed from the child's 
current educational placement for more than 10 school days in a school 
year is subjected to a removal that does not constitute a change of 
placement under Sec. 300.519, the IEP team members shall review the 
behavioral intervention plan and its implementation to determine if 
modifications are necessary.
    (2) If one or more of the team members believe that modifications 
are needed, the team shall meet to modify the plan and its 
implementation, to the extent the team determines necessary.
    (d) For purposes of this section, the following definitions apply:

[[Page 70]]

    (1) Controlled substance means a drug or other substance identified 
under schedules I, II, III, IV, or V in section 202(c) of the Controlled 
Substances Act (21 U.S.C. 812(c)).
    (2) Illegal drug--
    (i) Means a controlled substance; but
    (ii) Does not include a substance that is legally possessed or used 
under the supervision of a licensed health-care professional or that is 
legally possessed or used under any other authority under that Act or 
under any other provision of Federal law.
    (3) Weapon has the meaning given the term ``dangerous weapon'' under 
paragraph (2) of the first subsection (g) of section 930 of title 18, 
United States Code.

(Authority: 20 U.S.C. 1415(k)(1), (10))



Sec. 300.521  Authority of hearing officer.

    A hearing officer under section 615 of the Act may order a change in 
the placement of a child with a disability to an appropriate interim 
alternative educational setting for not more than 45 days if the hearing 
officer, in an expedited due process hearing--
    (a) Determines that the public agency has demonstrated by 
substantial evidence that maintaining the current placement of the child 
is substantially likely to result in injury to the child or to others;
    (b) Considers the appropriateness of the child's current placement;
    (c) Considers whether the public agency has made reasonable efforts 
to minimize the risk of harm in the child's current placement, including 
the use of supplementary aids and services; and
    (d) Determines that the interim alternative educational setting that 
is proposed by school personnel who have consulted with the child's 
special education teacher, meets the requirements of Sec. 300.522(b).
    (e) As used in this section, the term substantial evidence means 
beyond a preponderance of the evidence.

(Authority: 20 U.S.C. 1415(k)(2), (10))



Sec. 300.522  Determination of setting.

    (a) General. The interim alternative educational setting referred to 
in Sec. 300.520(a)(2) must be determined by the IEP team.
    (b) Additional requirements. Any interim alternative educational 
setting in which a child is placed under Sec. Sec. 300.520(a)(2) or 
300.521 must--
    (1) Be selected so as to enable the child to continue to progress in 
the general curriculum, although in another setting, and to continue to 
receive those services and modifications, including those described in 
the child's current IEP, that will enable the child to meet the goals 
set out in that IEP; and
    (2) Include services and modifications to address the behavior 
described in Sec. Sec. 300.520(a)(2) or 300.521, that are designed to 
prevent the behavior from recurring.

(Authority: 20 U.S.C. 1415(k)(3))



Sec. 300.523  Manifestation determination review.

    (a) General. If an action is contemplated regarding behavior 
described in Sec. Sec. 300.520(a)(2) or 300.521, or involving a removal 
that constitutes a change of placement under Sec. 300.519 for a child 
with a disability who has engaged in other behavior that violated any 
rule or code of conduct of the LEA that applies to all children--
    (1) Not later than the date on which the decision to take that 
action is made, the parents must be notified of that decision and 
provided the procedural safeguards notice described in Sec. 300.504; 
and
    (2) Immediately, if possible, but in no case later than 10 school 
days after the date on which the decision to take that action is made, a 
review must be conducted of the relationship between the child's 
disability and the behavior subject to the disciplinary action.
    (b) Individuals to carry out review. A review described in paragraph 
(a) of this section must be conducted by the IEP team and other 
qualified personnel in a meeting.
    (c) Conduct of review. In carrying out a review described in 
paragraph (a) of this section, the IEP team and other qualified 
personnel may determine that the behavior of the child was not a 
manifestation of the child's disability only if the IEP team and other 
qualified personnel--

[[Page 71]]

    (1) First consider, in terms of the behavior subject to disciplinary 
action, all relevant information, including --
    (i) Evaluation and diagnostic results, including the results or 
other relevant information supplied by the parents of the child;
    (ii) Observations of the child; and
    (iii) The child's IEP and placement; and
    (2) Then determine that--
    (i) In relationship to the behavior subject to disciplinary action, 
the child's IEP and placement were appropriate and the special education 
services, supplementary aids and services, and behavior intervention 
strategies were provided consistent with the child's IEP and placement;
    (ii) The child's disability did not impair the ability of the child 
to understand the impact and consequences of the behavior subject to 
disciplinary action; and
    (iii) The child's disability did not impair the ability of the child 
to control the behavior subject to disciplinary action.
    (d) Decision. If the IEP team and other qualified personnel 
determine that any of the standards in paragraph (c)(2) of this section 
were not met, the behavior must be considered a manifestation of the 
child's disability.
    (e) Meeting. The review described in paragraph (a) of this section 
may be conducted at the same IEP meeting that is convened under Sec. 
300.520(b).
    (f) Deficiencies in IEP or placement. If, in the review in 
paragraphs (b) and (c) of this section, a public agency identifies 
deficiencies in the child's IEP or placement or in their implementation, 
it must take immediate steps to remedy those deficiencies.

(Authority: 20 U.S.C. 1415(k)(4))



Sec. 300.524  Determination that behavior was not manifestation of 
disability.

    (a) General. If the result of the review described in Sec. 300.523 
is a determination, consistent with Sec. 300.523(d), that the behavior 
of the child with a disability was not a manifestation of the child's 
disability, the relevant disciplinary procedures applicable to children 
without disabilities may be applied to the child in the same manner in 
which they would be applied to children without disabilities, except as 
provided in Sec. 300.121(d).
    (b) Additional requirement. If the public agency initiates 
disciplinary procedures applicable to all children, the agency shall 
ensure that the special education and disciplinary records of the child 
with a disability are transmitted for consideration by the person or 
persons making the final determination regarding the disciplinary 
action.
    (c) Child's status during due process proceedings. Except as 
provided in Sec. 300.526, Sec. 300.514 applies if a parent requests a 
hearing to challenge a determination, made through the review described 
in Sec. 300.523, that the behavior of the child was not a manifestation 
of the child's disability.

(Authority: 20 U.S.C. 1415(k)(5))



Sec. 300.525  Parent appeal.

    (a) General. (1) If the child's parent disagrees with a 
determination that the child's behavior was not a manifestation of the 
child's disability or with any decision regarding placement under 
Sec. Sec. 300.520-300.528, the parent may request a hearing.
    (2) The State or local educational agency shall arrange for an 
expedited hearing in any case described in paragraph (a)(1) of this 
section if a hearing is requested by a parent.
    (b) Review of decision. (1) In reviewing a decision with respect to 
the manifestation determination, the hearing officer shall determine 
whether the public agency has demonstrated that the child's behavior was 
not a manifestation of the child's disability consistent with the 
requirements of Sec. 300.523(d).
    (2) In reviewing a decision under Sec. 300.520(a)(2) to place the 
child in an interim alternative educational setting, the hearing officer 
shall apply the standards in Sec. 300.521.

(Authority: 20 U.S.C. 1415(k)(6))



Sec. 300.526  Placement during appeals.

    (a) General. If a parent requests a hearing or an appeal regarding a 
disciplinary action described in Sec. 300.520(a)(2) or 300.521 to 
challenge the interim alternative educational setting or the 
manifestation determination, the child must remain in the interim

[[Page 72]]

alternative educational setting pending the decision of the hearing 
officer or until the expiration of the time period provided for in Sec. 
300.520(a)(2) or 300.521, whichever occurs first, unless the parent and 
the State agency or local educational agency agree otherwise.
    (b) Current placement. If a child is placed in an interim 
alternative educational setting pursuant to Sec. 300.520(a)(2) or 
300.521 and school personnel propose to change the child's placement 
after expiration of the interim alternative placement, during the 
pendency of any proceeding to challenge the proposed change in placement 
the child must remain in the current placement (the child's placement 
prior to the interim alternative educational setting), except as 
provided in paragraph (c) of this section.
    (c) Expedited hearing. (1) If school personnel maintain that it is 
dangerous for the child to be in the current placement (placement prior 
to removal to the interim alternative education setting) during the 
pendency of the due process proceedings, the LEA may request an 
expedited due process hearing.
    (2) In determining whether the child may be placed in the 
alternative educational setting or in another appropriate placement 
ordered by the hearing officer, the hearing officer shall apply the 
standards in Sec. 300.521.
    (3) A placement ordered pursuant to paragraph (c)(2) of this section 
may not be longer than 45 days.
    (4) The procedure in paragraph (c) of this section may be repeated, 
as necessary.

(Authority: 20 U.S.C. 1415(k)(7))



Sec. 300.527  Protections for children not yet eligible for special 
education and related services.

    (a) General. A child who has not been determined to be eligible for 
special education and related services under this part and who has 
engaged in behavior that violated any rule or code of conduct of the 
local educational agency, including any behavior described in Sec. Sec. 
300.520 or 300.521, may assert any of the protections provided for in 
this part if the LEA had knowledge (as determined in accordance with 
paragraph (b) of this section) that the child was a child with a 
disability before the behavior that precipitated the disciplinary action 
occurred.
    (b) Basis of knowledge. An LEA must be deemed to have knowledge that 
a child is a child with a disability if--
    (1) The parent of the child has expressed concern in writing (or 
orally if the parent does not know how to write or has a disability that 
prevents a written statement) to personnel of the appropriate 
educational agency that the child is in need of special education and 
related services;
    (2) The behavior or performance of the child demonstrates the need 
for these services, in accordance with Sec. 300.7;
    (3) The parent of the child has requested an evaluation of the child 
pursuant to Sec. Sec. 300.530-300.536; or
    (4) The teacher of the child, or other personnel of the local 
educational agency, has expressed concern about the behavior or 
performance of the child to the director of special education of the 
agency or to other personnel in accordance with the agency's established 
child find or special education referral system.
    (c) Exception. A public agency would not be deemed to have knowledge 
under paragraph (b) of this section if, as a result of receiving the 
information specified in that paragraph, the agency--
    (1) Either--
    (i) Conducted an evaluation under Sec. Sec. 300.530-300.536, and 
determined that the child was not a child with a disability under this 
part; or
    (ii) Determined that an evaluation was not necessary; and
    (2) Provided notice to the child's parents of its determination 
under paragraph (c)(1) of this section, consistent with Sec. 300.503.
    (d) Conditions that apply if no basis of knowledge. (1) General. If 
an LEA does not have knowledge that a child is a child with a disability 
(in accordance with paragraphs (b) and (c) of this section) prior to 
taking disciplinary measures against the child, the child may be 
subjected to the same disciplinary measures as measures applied to 
children without disabilities who engaged in comparable behaviors 
consistent with paragraph (d)(2) of this section.

[[Page 73]]

    (2) Limitations. (i) If a request is made for an evaluation of a 
child during the time period in which the child is subjected to 
disciplinary measures under Sec. 300.520 or 300.521, the evaluation 
must be conducted in an expedited manner.
    (ii) Until the evaluation is completed, the child remains in the 
educational placement determined by school authorities, which can 
include suspension or expulsion without educational services.
    (iii) If the child is determined to be a child with a disability, 
taking into consideration information from the evaluation conducted by 
the agency and information provided by the parents, the agency shall 
provide special education and related services in accordance with the 
provisions of this part, including the requirements of Sec. Sec. 
300.520-300.529 and section 612(a)(1)(A) of the Act.

(Authority: 20 U.S.C. 1415(k)(8))



Sec. 300.528  Expedited due process hearings.

    (a) Expedited due process hearings under Sec. Sec. 300.521-300.526 
must--
    (1) Meet the requirements of Sec. 300.509, except that a State may 
provide that the time periods identified in Sec. Sec. 300.509(a)(3) and 
Sec. 300.509(b) for purposes of expedited due process hearings under 
Sec. Sec. 300.521-300.526 are not less than two business days; and
    (2) Be conducted by a due process hearing officer who satisfies the 
requirements of Sec. 300.508.
    (b)(1) Each State shall establish a timeline for expedited due 
process hearings that results in a written decision being mailed to the 
parties within 45 days of the public agency's receipt of the request for 
the hearing, without exceptions or extensions.
    (2) The timeline established under paragraph (b)(1) of this section 
must be the same for hearings requested by parents or public agencies.
    (c) A State may establish different procedural rules for expedited 
hearings under Sec. Sec. 300.521-300.526 than it has established for 
due process hearings under Sec. 300.507.
    (d) The decisions on expedited due process hearings are appealable 
consistent with Sec. 300.510.

(Authority: 20 U.S.C. 1415(k)(2), (6), (7))



Sec. 300.529  Referral to and action by law enforcement and judicial 
authorities.

    (a) Nothing in this part prohibits an agency from reporting a crime 
committed by a child with a disability to appropriate authorities or to 
prevent State law enforcement and judicial authorities from exercising 
their responsibilities with regard to the application of Federal and 
State law to crimes committed by a child with a disability.
    (b)(1) An agency reporting a crime committed by a child with a 
disability shall ensure that copies of the special education and 
disciplinary records of the child are transmitted for consideration by 
the appropriate authorities to whom it reports the crime.
    (2) An agency reporting a crime under this section may transmit 
copies of the child's special education and disciplinary records only to 
the extent that the transmission is permitted by the Family Educational 
Rights and Privacy Act.

(Authority: 20 U.S.C. 1415(k)(9))

       Procedures for Evaluation and Determination of Eligibility



Sec. 300.530  General.

    Each SEA shall ensure that each public agency establishes and 
implements procedures that meet the requirements of Sec. Sec. 300.531-
300.536.

(Authority: 20 U.S.C. 1414(b)(3); 1412(a)(7))



Sec. 300.531  Initial evaluation.

    Each public agency shall conduct a full and individual initial 
evaluation, in accordance with Sec. Sec. 300.532 and 300.533, before 
the initial provision of special education and related services to a 
child with a disability under Part B of the Act.

(Authority: 20 U.S.C. 1414(a)(1))



Sec. 300.532  Evaluation procedures.

    Each public agency shall ensure, at a minimum, that the following 
requirements are met:
    (a)(1) Tests and other evaluation materials used to assess a child 
under Part B of the Act--
    (i) Are selected and administered so as not to be discriminatory on 
a racial or cultural basis; and

[[Page 74]]

    (ii) Are provided and administered in the child's native language or 
other mode of communication, unless it is clearly not feasible to do so; 
and
    (2) Materials and procedures used to assess a child with limited 
English proficiency are selected and administered to ensure that they 
measure the extent to which the child has a disability and needs special 
education, rather than measuring the child's English language skills.
    (b) A variety of assessment tools and strategies are used to gather 
relevant functional and developmental information about the child, 
including information provided by the parent, and information related to 
enabling the child to be involved in and progress in the general 
curriculum (or for a preschool child, to participate in appropriate 
activities), that may assist in determining--
    (1) Whether the child is a child with a disability under Sec. 
300.7; and
    (2) The content of the child's IEP.
    (c)(1) Any standardized tests that are given to a child--
    (i) Have been validated for the specific purpose for which they are 
used; and
    (ii) Are administered by trained and knowledgeable personnel in 
accordance with any instructions provided by the producer of the tests.
    (2) If an assessment is not conducted under standard conditions, a 
description of the extent to which it varied from standard conditions 
(e.g., the qualifications of the person administering the test, or the 
method of test administration) must be included in the evaluation 
report.
    (d) Tests and other evaluation materials include those tailored to 
assess specific areas of educational need and not merely those that are 
designed to provide a single general intelligence quotient.
    (e) Tests are selected and administered so as best to ensure that if 
a test is administered to a child with impaired sensory, manual, or 
speaking skills, the test results accurately reflect the child's 
aptitude or achievement level or whatever other factors the test 
purports to measure, rather than reflecting the child's impaired 
sensory, manual, or speaking skills (unless those skills are the factors 
that the test purports to measure).
    (f) No single procedure is used as the sole criterion for 
determining whether a child is a child with a disability and for 
determining an appropriate educational program for the child.
    (g) The child is assessed in all areas related to the suspected 
disability, including, if appropriate, health, vision, hearing, social 
and emotional status, general intelligence, academic performance, 
communicative status, and motor abilities.
    (h) In evaluating each child with a disability under Sec. Sec. 
300.531-300.536, the evaluation is sufficiently comprehensive to 
identify all of the child's special education and related services 
needs, whether or not commonly linked to the disability category in 
which the child has been classified.
    (i) The public agency uses technically sound instruments that may 
assess the relative contribution of cognitive and behavioral factors, in 
addition to physical or developmental factors.
    (j) The public agency uses assessment tools and strategies that 
provide relevant information that directly assists persons in 
determining the educational needs of the child.

(Authority: 20 U.S.C. 1412(a)(6)(B), 1414(b)(2) and (3))



Sec. 300.533  Determination of needed evaluation data.

    (a) Review of existing evaluation data. As part of an initial 
evaluation (if appropriate) and as part of any reevaluation under Part B 
of the Act, a group that includes the individuals described in Sec. 
300.344, and other qualified professionals, as appropriate, shall--
    (1) Review existing evaluation data on the child, including--
    (i) Evaluations and information provided by the parents of the 
child;
    (ii) Current classroom-based assessments and observations; and
    (iii) Observations by teachers and related services providers; and
    (2) On the basis of that review, and input from the child's parents, 
identify what additional data, if any, are needed to determine--
    (i) Whether the child has a particular category of disability, as 
described in

[[Page 75]]

Sec. 300.7, or, in case of a reevaluation of a child, whether the child 
continues to have such a disability;
    (ii) The present levels of performance and educational needs of the 
child;
    (iii) Whether the child needs special education and related 
services, or in the case of a reevaluation of a child, whether the child 
continues to need special education and related services; and
    (iv) Whether any additions or modifications to the special education 
and related services are needed to enable the child to meet the 
measurable annual goals set out in the IEP of the child and to 
participate, as appropriate, in the general curriculum.
    (b) Conduct of review. The group described in paragraph (a) of this 
section may conduct its review without a meeting.
    (c) Need for additional data. The public agency shall administer 
tests and other evaluation materials as may be needed to produce the 
data identified under paragraph (a) of this section.
    (d) Requirements if additional data are not needed. (1) If the 
determination under paragraph (a) of this section is that no additional 
data are needed to determine whether the child continues to be a child 
with a disability, the public agency shall notify the child's parents--
    (i) Of that determination and the reasons for it; and
    (ii) Of the right of the parents to request an assessment to 
determine whether, for purposes of services under this part, the child 
continues to be a child with a disability.
    (2) The public agency is not required to conduct the assessment 
described in paragraph (d)(1)(ii) of this section unless requested to do 
so by the child's parents.

(Authority: 20 U.S.C. 1414(c)(1), (2) and (4))



Sec. 300.534  Determination of eligibility.

    (a) Upon completing the administration of tests and other evaluation 
materials--
    (1) A group of qualified professionals and the parent of the child 
must determine whether the child is a child with a disability, as 
defined in Sec. 300.7; and
    (2) The public agency must provide a copy of the evaluation report 
and the documentation of determination of eligibility to the parent.
    (b) A child may not be determined to be eligible under this part 
if--
    (1) The determinant factor for that eligibility determination is--
    (i) Lack of instruction in reading or math; or
    (ii) Limited English proficiency; and
    (2) The child does not otherwise meet the eligibility criteria under 
Sec. 300.7(a).
    (c)(1) A public agency must evaluate a child with a disability in 
accordance with Sec. Sec. 300.532 and 300.533 before determining that 
the child is no longer a child with a disability.
    (2) The evaluation described in paragraph (c)(1) of this section is 
not required before the termination of a student's eligibility under 
Part B of the Act due to graduation with a regular high school diploma, 
or exceeding the age eligibility for FAPE under State law.

(Authority: 20 U.S.C. 1414(b)(4) and (5), (c)(5))



Sec. 300.535  Procedures for determining eligibility and placement.

    (a) In interpreting evaluation data for the purpose of determining 
if a child is a child with a disability under Sec. 300.7, and the 
educational needs of the child, each public agency shall--
    (1) Draw upon information from a variety of sources, including 
aptitude and achievement tests, parent input, teacher recommendations, 
physical condition, social or cultural background, and adaptive 
behavior; and
    (2) Ensure that information obtained from all of these sources is 
documented and carefully considered.
    (b) If a determination is made that a child has a disability and 
needs special education and related services, an IEP must be developed 
for the child in accordance with Sec. Sec. 300.340-300.350.

(Authority: 20 U.S.C. 1412(a)(6), 1414(b)(4))



Sec. 300.536  Reevaluation.

    Each public agency shall ensure--
    (a) That the IEP of each child with a disability is reviewed in 
accordance with Sec. Sec. 300.340-300.350; and
    (b) That a reevaluation of each child, in accordance with Sec. Sec. 
300.532-300.535, is conducted if conditions warrant a reevaluation, or 
if the child's parent or

[[Page 76]]

teacher requests a reevaluation, but at least once every three years.

(Authority: 20 U.S.C. 1414(a)(2))

  Additional Procedures for Evaluating Children With Specific Learning 
                              Disabilities



Sec. 300.540  Additional team members.

    The determination of whether a child suspected of having a specific 
learning disability is a child with a disability as defined in Sec. 
300.7, must be made by the child's parents and a team of qualified 
professionals which must include--
    (a)(1) The child's regular teacher; or
    (2) If the child does not have a regular teacher, a regular 
classroom teacher qualified to teach a child of his or her age; or
    (3) For a child of less than school age, an individual qualified by 
the SEA to teach a child of his or her age; and
    (b) At least one person qualified to conduct individual diagnostic 
examinations of children, such as a school psychologist, speech-language 
pathologist, or remedial reading teacher.

(Authority: Sec. 5(b), Pub. L. 94-142)



Sec. 300.541  Criteria for determining the existence of a specific learning 
disability.

    (a) A team may determine that a child has a specific learning 
disability if--
    (1) The child does not achieve commensurate with his or her age and 
ability levels in one or more of the areas listed in paragraph (a)(2) of 
this section, if provided with learning experiences appropriate for the 
child's age and ability levels; and
    (2) The team finds that a child has a severe discrepancy between 
achievement and intellectual ability in one or more of the following 
areas:
    (i) Oral expression.
    (ii) Listening comprehension.
    (iii) Written expression.
    (iv) Basic reading skill.
    (v) Reading comprehension.
    (vi) Mathematics calculation.
    (vii) Mathematics reasoning.
    (b) The team may not identify a child as having a specific learning 
disability if the severe discrepancy between ability and achievement is 
primarily the result of--
    (1) A visual, hearing, or motor impairment;
    (2) Mental retardation;
    (3) Emotional disturbance; or
    (4) Environmental, cultural or economic disadvantage.

(Authority: Sec. 5(b), Pub. L. 94-142)



Sec. 300.542  Observation.

    (a) At least one team member other than the child's regular teacher 
shall observe the child's academic performance in the regular classroom 
setting.
    (b) In the case of a child of less than school age or out of school, 
a team member shall observe the child in an environment appropriate for 
a child of that age.

(Authority: Sec. 5(b), Pub. L. 94-142)



Sec. 300.543  Written report.

    (a) For a child suspected of having a specific learning disability, 
the documentation of the team's determination of eligibility, as 
required by Sec. 300.534(a)(2), must include a statement of--
    (1) Whether the child has a specific learning disability;
    (2) The basis for making the determination;
    (3) The relevant behavior noted during the observation of the child;
    (4) The relationship of that behavior to the child's academic 
functioning;
    (5) The educationally relevant medical findings, if any;
    (6) Whether there is a severe discrepancy between achievement and 
ability that is not correctable without special education and related 
services; and
    (7) The determination of the team concerning the effects of 
environmental, cultural, or economic disadvantage.
    (b) Each team member shall certify in writing whether the report 
reflects his or her conclusion. If it does not reflect his or her 
conclusion, the team member must submit a separate statement presenting 
his or her conclusions.

(Authority: Sec. 5(b), Pub. L. 94-142))

[[Page 77]]

                   Least Restrictive Environment (LRE)



Sec. 300.550  General LRE requirements.

    (a) Except as provided in Sec. 300.311(b) and (c), a State shall 
demonstrate to the satisfaction of the Secretary that the State has in 
effect policies and procedures to ensure that it meets the requirements 
of Sec. Sec. 300.550-300.556.
    (b) Each public agency shall ensure--
    (1) That to the maximum extent appropriate, children with 
disabilities, including children in public or private institutions or 
other care facilities, are educated with children who are nondisabled; 
and
    (2) That special classes, separate schooling or other removal of 
children with disabilities from the regular educational environment 
occurs only if the nature or severity of the disability is such that 
education in regular classes with the use of supplementary aids and 
services cannot be achieved satisfactorily.

(Authority: 20 U.S.C. 1412(a)(5))



Sec. 300.551  Continuum of alternative placements.

    (a) Each public agency shall ensure that a continuum of alternative 
placements is available to meet the needs of children with disabilities 
for special education and related services.
    (b) The continuum required in paragraph (a) of this section must--
    (1) Include the alternative placements listed in the definition of 
special education under Sec. 300.26 (instruction in regular classes, 
special classes, special schools, home instruction, and instruction in 
hospitals and institutions); and
    (2) Make provision for supplementary services (such as resource room 
or itinerant instruction) to be provided in conjunction with regular 
class placement.

(Authority: 20 U.S.C. 1412(a)(5))



Sec. 300.552  Placements.

    In determining the educational placement of a child with a 
disability, including a preschool child with a disability, each public 
agency shall ensure that--
    (a) The placement decision--
    (1) Is made by a group of persons, including the parents, and other 
persons knowledgeable about the child, the meaning of the evaluation 
data, and the placement options; and
    (2) Is made in conformity with the LRE provisions of this subpart, 
including Sec. Sec. 300.550-300.554;
    (b) The child's placement--
    (1) Is determined at least annually;
    (2) Is based on the child's IEP; and
    (3) Is as close as possible to the child's home;
    (c) Unless the IEP of a child with a disability requires some other 
arrangement, the child is educated in the school that he or she would 
attend if nondisabled;
    (d) In selecting the LRE, consideration is given to any potential 
harmful effect on the child or on the quality of services that he or she 
needs; and
    (e) A child with a disability is not removed from education in age-
appropriate regular classrooms solely because of needed modifications in 
the general curriculum.

(Authority: 20 U.S.C. 1412(a)(5))



Sec. 300.553  Nonacademic settings.

    In providing or arranging for the provision of nonacademic and 
extracurricular services and activities, including meals, recess 
periods, and the services and activities set forth in Sec. 300.306, 
each public agency shall ensure that each child with a disability 
participates with nondisabled children in those services and activities 
to the maximum extent appropriate to the needs of that child.

(Authority: 20 U.S.C. 1412(a)(5))



Sec. 300.554  Children in public or private institutions.

    Except as provided in Sec. 300.600(d), an SEA must ensure that 
Sec. 300.550 is effectively implemented, including, if necessary, 
making arrangements with public and private institutions (such as a 
memorandum of agreement or special implementation procedures).

(Authority: 20 U.S.C. 1412(a)(5))

[[Page 78]]



Sec. 300.555  Technical assistance and training activities.

    Each SEA shall carry out activities to ensure that teachers and 
administrators in all public agencies--
    (a) Are fully informed about their responsibilities for implementing 
Sec. 300.550; and
    (b) Are provided with technical assistance and training necessary to 
assist them in this effort.

(Authority: 20 U.S.C. 1412(a)(5))



Sec. 300.556  Monitoring activities.

    (a) The SEA shall carry out activities to ensure that Sec. 300.550 
is implemented by each public agency.
    (b) If there is evidence that a public agency makes placements that 
are inconsistent with Sec. 300.550, the SEA shall--
    (1) Review the public agency's justification for its actions; and
    (2) Assist in planning and implementing any necessary corrective 
action.

(Authority: 20 U.S.C. 1412(a)(5))

                     Confidentiality of Information



Sec. 300.560   Definitions.

    As used in Sec. Sec. 300.560-300.577--
    (a) Destruction means physical destruction or removal of personal 
identifiers from information so that the information is no longer 
personally identifiable.
    (b) Education records means the type of records covered under the 
definition of ``education records'' in 34 CFR part 99 (the regulations 
implementing the Family Educational Rights and Privacy Act of 1974).
    (c) Participating agency means any agency or institution that 
collects, maintains, or uses personally identifiable information, or 
from which information is obtained, under Part B of the Act.

(Authority: 20 U.S.C. 1221e-3, 1412(a)(8), 1417(c))



Sec. 300.561  Notice to parents.

    (a) The SEA shall give notice that is adequate to fully inform 
parents about the requirements of Sec. 300.127, including--
    (1) A description of the extent that the notice is given in the 
native languages of the various population groups in the State;
    (2) A description of the children on whom personally identifiable 
information is maintained, the types of information sought, the methods 
the State intends to use in gathering the information (including the 
sources from whom information is gathered), and the uses to be made of 
the information;
    (3) A summary of the policies and procedures that participating 
agencies must follow regarding storage, disclosure to third parties, 
retention, and destruction of personally identifiable information; and
    (4) A description of all of the rights of parents and children 
regarding this information, including the rights under the Family 
Educational Rights and Privacy Act of 1974 and implementing regulations 
in 34 CFR part 99.
    (b) Before any major identification, location, or evaluation 
activity, the notice must be published or announced in newspapers or 
other media, or both, with circulation adequate to notify parents 
throughout the State of the activity.

(Authority: 20 U.S.C. 1412(a)(8), 1417(c))



Sec. 300.562  Access rights.

    (a) Each participating agency shall permit parents to inspect and 
review any education records relating to their children that are 
collected, maintained, or used by the agency under this part. The agency 
shall comply with a request without unnecessary delay and before any 
meeting regarding an IEP, or any hearing pursuant to Sec. Sec. 300.507 
and 300.521-300.528, and in no case more than 45 days after the request 
has been made.
    (b) The right to inspect and review education records under this 
section includes--
    (1) The right to a response from the participating agency to 
reasonable requests for explanations and interpretations of the records;
    (2) The right to request that the agency provide copies of the 
records containing the information if failure to provide those copies 
would effectively prevent the parent from exercising the

[[Page 79]]

right to inspect and review the records; and
    (3) The right to have a representative of the parent inspect and 
review the records.
    (c) An agency may presume that the parent has authority to inspect 
and review records relating to his or her child unless the agency has 
been advised that the parent does not have the authority under 
applicable State law governing such matters as guardianship, separation, 
and divorce.

(Authority: 20 U.S.C. 1412(a)(8), 1417(c))



Sec. 300.563  Record of access.

    Each participating agency shall keep a record of parties obtaining 
access to education records collected, maintained, or used under Part B 
of the Act (except access by parents and authorized employees of the 
participating agency), including the name of the party, the date access 
was given, and the purpose for which the party is authorized to use the 
records.

(Authority: 20 U.S.C. 1412(a)(8), 1417(c))



Sec. 300.564  Records on more than one child.

    If any education record includes information on more than one child, 
the parents of those children have the right to inspect and review only 
the information relating to their child or to be informed of that 
specific information.

(Authority: 20 U.S.C. 1412(a)(8), 1417(c))



Sec. 300.565  List of types and locations of information.

    Each participating agency shall provide parents on request a list of 
the types and locations of education records collected, maintained, or 
used by the agency.

(Authority: 20 U.S.C. 1412(a)(8), 1417(c))



Sec. 300.566  Fees.

    (a) Each participating agency may charge a fee for copies of records 
that are made for parents under this part if the fee does not 
effectively prevent the parents from exercising their right to inspect 
and review those records.
    (b) A participating agency may not charge a fee to search for or to 
retrieve information under this part.

(Authority: 20 U.S.C. 1412(a)(8), 1417(c))



Sec. 300.567  Amendment of records at parent's request.

    (a) A parent who believes that information in the education records 
collected, maintained, or used under this part is inaccurate or 
misleading or violates the privacy or other rights of the child may 
request the participating agency that maintains the information to amend 
the information.
    (b) The agency shall decide whether to amend the information in 
accordance with the request within a reasonable period of time of 
receipt of the request.
    (c) If the agency decides to refuse to amend the information in 
accordance with the request, it shall inform the parent of the refusal 
and advise the parent of the right to a hearing under Sec. 300.568.

(Authority: 20 U.S.C. 1412(a)(8); 1417(c))



Sec. 300.568  Opportunity for a hearing.

    The agency shall, on request, provide an opportunity for a hearing 
to challenge information in education records to ensure that it is not 
inaccurate, misleading, or otherwise in violation of the privacy or 
other rights of the child.

(Authority: 20 U.S.C. 1412(a)(8), 1417(c))



Sec. 300.569  Result of hearing.

    (a) If, as a result of the hearing, the agency decides that the 
information is inaccurate, misleading or otherwise in violation of the 
privacy or other rights of the child, it shall amend the information 
accordingly and so inform the parent in writing.
    (b) If, as a result of the hearing, the agency decides that the 
information is not inaccurate, misleading, or otherwise in violation of 
the privacy or other rights of the child, it shall inform the parent of 
the right to place in the records it maintains on the child a statement 
commenting on the information or setting forth any reasons for 
disagreeing with the decision of the agency.

[[Page 80]]

    (c) Any explanation placed in the records of the child under this 
section must--
    (1) Be maintained by the agency as part of the records of the child 
as long as the record or contested portion is maintained by the agency; 
and
    (2) If the records of the child or the contested portion is 
disclosed by the agency to any party, the explanation must also be 
disclosed to the party.

(Authority: 20 U.S.C. 1412(a)(8), 1417(c))



Sec. 300.570  Hearing procedures.

    A hearing held under Sec. 300.568 must be conducted according to 
the procedures under 34 CFR 99.22.

(Authority: 20 U.S.C. 1412(a)(8), 1417(c))



Sec. 300.571  Consent.

    (a) Except as to disclosures addressed in Sec. 300.529(b) for which 
parental consent is not required by Part 99, parental consent must be 
obtained before personally identifiable information is--
    (1) Disclosed to anyone other than officials of participating 
agencies collecting or using the information under this part, subject to 
paragraph (b) of this section; or
    (2) Used for any purpose other than meeting a requirement of this 
part.
    (b) An educational agency or institution subject to 34 CFR part 99 
may not release information from education records to participating 
agencies without parental consent unless authorized to do so under part 
99.
    (c) The SEA shall provide policies and procedures that are used in 
the event that a parent refuses to provide consent under this section.

(Authority: 20 U.S.C. 1412(a)(8), 1417(c))



Sec. 300.572  Safeguards.

    (a) Each participating agency shall protect the confidentiality of 
personally identifiable information at collection, storage, disclosure, 
and destruction stages.
    (b) One official at each participating agency shall assume 
responsibility for ensuring the confidentiality of any personally 
identifiable information.
    (c) All persons collecting or using personally identifiable 
information must receive training or instruction regarding the State's 
policies and procedures under Sec. 300.127 and 34 CFR part 99.
    (d) Each participating agency shall maintain, for public inspection, 
a current listing of the names and positions of those employees within 
the agency who may have access to personally identifiable information.

(Authority: 20 U.S.C. 1412(a)(8), 1417(c))



Sec. 300.573  Destruction of information.

    (a) The public agency shall inform parents when personally 
identifiable information collected, maintained, or used under this part 
is no longer needed to provide educational services to the child.
    (b) The information must be destroyed at the request of the parents. 
However, a permanent record of a student's name, address, and phone 
number, his or her grades, attendance record, classes attended, grade 
level completed, and year completed may be maintained without time 
limitation.

(Authority: 20 U.S.C. 1412(a)(8), 1417(c))



Sec. 300.574  Children's rights.

    (a) The SEA shall provide policies and procedures regarding the 
extent to which children are afforded rights of privacy similar to those 
afforded to parents, taking into consideration the age of the child and 
type or severity of disability.
    (b) Under the regulations for the Family Educational Rights and 
Privacy Act of 1974 (34 CFR 99.5(a)), the rights of parents regarding 
education records are transferred to the student at age 18.
    (c) If the rights accorded to parents under Part B of the Act are 
transferred to a student who reaches the age of majority, consistent 
with Sec. 300.517, the rights regarding educational records in 
Sec. Sec. 300.562-300.573 must also be transferred to the student. 
However, the public agency must provide any notice required under 
section 615 of the Act to the student and the parents.

(Authority: 20 U.S.C. 1412(a)(8), 1417(c))



Sec. 300.575  Enforcement.

    The SEA shall provide the policies and procedures, including 
sanctions, that the State uses to ensure that its policies and 
procedures are followed

[[Page 81]]

and that the requirements of the Act and the regulations in this part 
are met.

(Authority: 20 U.S.C. 1412(a)(8), 1417(c))



Sec. 300.576  Disciplinary information.

    (a) The State may require that a public agency include in the 
records of a child with a disability a statement of any current or 
previous disciplinary action that has been taken against the child and 
transmit the statement to the same extent that the disciplinary 
information is included in, and transmitted with, the student records of 
nondisabled children.
    (b) The statement may include a description of any behavior engaged 
in by the child that required disciplinary action, a description of the 
disciplinary action taken, and any other information that is relevant to 
the safety of the child and other individuals involved with the child.
    (c) If the State adopts such a policy, and the child transfers from 
one school to another, the transmission of any of the child's records 
must include both the child's current individualized education program 
and any statement of current or previous disciplinary action that has 
been taken against the child.

(Authority: 20 U.S.C. 1413(j))



Sec. 300.577  Department use of personally identifiable information.

    If the Department or its authorized representatives collect any 
personally identifiable information regarding children with disabilities 
that is not subject to 5 U.S.C. 552a (the Privacy Act of 1974), the 
Secretary applies the requirements of 5 U.S.C. 552a (b)(1)-(2), (4)-
(11); (c); (d); (e)(1), (2), (3)(A), (B), and (D), (5)-(10); (h); (m); 
and (n); and the regulations implementing those provisions in 34 CFR 
part 5b.

(Authority: 20 U.S.C. 1412(a)(8), 1417(c))

                          Department Procedures



Sec. 300.580  Determination by the Secretary that a State is eligible.

    If the Secretary determines that a State is eligible to receive a 
grant under Part B of the Act, the Secretary notifies the State of that 
determination.

(Authority: 20 U.S.C. 1412(d))



Sec. 300.581  Notice and hearing before determining that a State is 
not eligible.

    (a) General. (1) The Secretary does not make a final determination 
that a State is not eligible to receive a grant under Part B of the Act 
until providing the State--
    (i) With reasonable notice; and
    (ii) With an opportunity for a hearing.
    (2) In implementing paragraph (a)(1)(i) of this section, the 
Secretary sends a written notice to the SEA by certified mail with 
return receipt requested.
    (b) Content of notice. In the written notice described in paragraph 
(a)(2) of this section, the Secretary--
    (1) States the basis on which the Secretary proposes to make a final 
determination that the State is not eligible;
    (2) May describe possible options for resolving the issues;
    (3) Advises the SEA that it may request a hearing and that the 
request for a hearing must be made not later than 30 days after it 
receives the notice of the proposed final determination that the State 
is not eligible; and
    (4) Provides information about the procedures followed for a 
hearing.

(Authority: 20 U.S.C. (1412(d)(2))



Sec. 300.582  Hearing official or panel.

    (a) If the SEA requests a hearing, the Secretary designates one or 
more individuals, either from the Department or elsewhere, not 
responsible for or connected with the administration of this program, to 
conduct a hearing.
    (b) If more than one individual is designated, the Secretary 
designates one of those individuals as the Chief Hearing Official of the 
Hearing Panel. If one individual is designated, that individual is the 
Hearing Official.

(Authority: 20 U.S.C. (1412(d)(2))



Sec. 300.583  Hearing procedures.

    (a) As used in Sec. Sec. 300.581-300.586 the term party or parties 
means the following:

[[Page 82]]

    (1) An SEA that requests a hearing regarding the proposed 
disapproval of the State's eligibility under this part.
    (2) The Department official who administers the program of financial 
assistance under this part.
    (3) A person, group or agency with an interest in and having 
relevant information about the case that has applied for and been 
granted leave to intervene by the Hearing Official or Panel.
    (b) Within 15 days after receiving a request for a hearing, the 
Secretary designates a Hearing Official or Panel and notifies the 
parties.
    (c) The Hearing Official or Panel may regulate the course of 
proceedings and the conduct of the parties during the proceedings. The 
Hearing Official or Panel takes all steps necessary to conduct a fair 
and impartial proceeding, to avoid delay, and to maintain order, 
including the following:
    (1) The Hearing Official or Panel may hold conferences or other 
types of appropriate proceedings to clarify, simplify, or define the 
issues or to consider other matters that may aid in the disposition of 
the case.
    (2) The Hearing Official or Panel may schedule a prehearing 
conference of the Hearing Official or Panel and parties.
    (3) Any party may request the Hearing Official or Panel to schedule 
a prehearing or other conference. The Hearing Official or Panel decides 
whether a conference is necessary and notifies all parties.
    (4) At a prehearing or other conference, the Hearing Official or 
Panel and the parties may consider subjects such as--
    (i) Narrowing and clarifying issues;
    (ii) Assisting the parties in reaching agreements and stipulations;
    (iii) Clarifying the positions of the parties;
    (iv) Determining whether an evidentiary hearing or oral argument 
should be held; and
    (v) Setting dates for--
    (A) The exchange of written documents;
    (B) The receipt of comments from the parties on the need for oral 
argument or evidentiary hearing;
    (C) Further proceedings before the Hearing Official or Panel 
(including an evidentiary hearing or oral argument, if either is 
scheduled);
    (D) Requesting the names of witnesses each party wishes to present 
at an evidentiary hearing and estimation of time for each presentation; 
or
    (E) Completion of the review and the initial decision of the Hearing 
Official or Panel.
    (5) A prehearing or other conference held under paragraph (b)(4) of 
this section may be conducted by telephone conference call.
    (6) At a prehearing or other conference, the parties shall be 
prepared to discuss the subjects listed in paragraph (b)(4) of this 
section.
    (7) Following a prehearing or other conference the Hearing Official 
or Panel may issue a written statement describing the issues raised, the 
action taken, and the stipulations and agreements reached by the 
parties.
    (d) The Hearing Official or Panel may require parties to state their 
positions and to provide all or part of the evidence in writing.
    (e) The Hearing Official or Panel may require parties to present 
testimony through affidavits and to conduct cross-examination through 
interrogatories.
    (f) The Hearing Official or Panel may direct the parties to exchange 
relevant documents or information and lists of witnesses, and to send 
copies to the Hearing Official or Panel.
    (g) The Hearing Official or Panel may receive, rule on, exclude, or 
limit evidence at any stage of the proceedings.
    (h) The Hearing Official or Panel may rule on motions and other 
issues at any stage of the proceedings.
    (i) The Hearing Official or Panel may examine witnesses.
    (j) The Hearing Official or Panel may set reasonable time limits for 
submission of written documents.
    (k) The Hearing Official or Panel may refuse to consider documents 
or other submissions if they are not submitted in a timely manner unless 
good cause is shown.
    (l) The Hearing Official or Panel may interpret applicable statutes 
and regulations but may not waive them or rule on their validity.

[[Page 83]]

    (m)(1) The parties shall present their positions through briefs and 
the submission of other documents and may request an oral argument or 
evidentiary hearing. The Hearing Official or Panel shall determine 
whether an oral argument or an evidentiary hearing is needed to clarify 
the positions of the parties.
    (2) The Hearing Official or Panel gives each party an opportunity to 
be represented by counsel.
    (n) If the Hearing Official or Panel determines that an evidentiary 
hearing would materially assist the resolution of the matter, the 
Hearing Official or Panel gives each party, in addition to the 
opportunity to be represented by counse--
    (1) An opportunity to present witnesses on the party's behalf; and
    (2) An opportunity to cross-examine witnesses either orally or with 
written questions.
    (o) The Hearing Official or Panel accepts any evidence that it finds 
is relevant and material to the proceedings and is not unduly 
repetitious.
    (p)(1) The Hearing Official or Panel--
    (i) Arranges for the preparation of a transcript of each hearing;
    (ii) Retains the original transcript as part of the record of the 
hearing; and
    (iii) Provides one copy of the transcript to each party.
    (2) Additional copies of the transcript are available on request and 
with payment of the reproduction fee.
    (q) Each party shall file with the Hearing Official or Panel all 
written motions, briefs, and other documents and shall at the same time 
provide a copy to the other parties to the proceedings.

(Authority: 20 U.S.C. (1412(d)(2))



Sec. 300.584  Initial decision; final decision.

    (a) The Hearing Official or Panel prepares an initial written 
decision that addresses each of the points in the notice sent by the 
Secretary to the SEA under Sec. 300.581.
    (b) The initial decision of a Panel is made by a majority of Panel 
members.
    (c) The Hearing Official or Panel mails by certified mail with 
return receipt requested a copy of the initial decision to each party 
(or to the party's counsel) and to the Secretary, with a notice stating 
that each party has an opportunity to submit written comments regarding 
the decision to the Secretary.
    (d) Each party may file comments and recommendations on the initial 
decision with the Hearing Official or Panel within 15 days of the date 
the party receives the Panel's decision.
    (e) The Hearing Official or Panel sends a copy of a party's initial 
comments and recommendations to the other parties by certified mail with 
return receipt requested. Each party may file responsive comments and 
recommendations with the Hearing Official or Panel within seven days of 
the date the party receives the initial comments and recommendations.
    (f) The Hearing Official or Panel forwards the parties' initial and 
responsive comments on the initial decision to the Secretary who reviews 
the initial decision and issues a final decision.
    (g) The initial decision of the Hearing Official or Panel becomes 
the final decision of the Secretary unless, within 25 days after the end 
of the time for receipt of written comments, the Secretary informs the 
Hearing Official or Panel and the parties to a hearing in writing that 
the decision is being further reviewed for possible modification.
    (h) The Secretary may reject or modify the initial decision of the 
Hearing Official or Panel if the Secretary finds that it is clearly 
erroneous.
    (i) The Secretary conducts the review based on the initial decision, 
the written record, the Hearing Official's or Panel's proceedings, and 
written comments. The Secretary may remand the matter for further 
proceedings.
    (j) The Secretary issues the final decision within 30 days after 
notifying the Hearing Official or Panel that the initial decision is 
being further reviewed.

(Authority: 20 U.S.C. (1412(d)(2))



Sec. 300.585  Filing requirements.

    (a) Any written submission under Sec. Sec. 300.581-300.585 must be 
filed by hand-delivery, by mail, or by facsimile transmission. The 
Secretary discourages the use of facsimile transmission for documents 
longer than five pages.

[[Page 84]]

    (b) The filing date under paragraph (a) of this section is the date 
the document is--
    (1) Hand-delivered;
    (2) Mailed; or (3) Sent by facsimile transmission.
    (c) A party filing by facsimile transmission is responsible for 
confirming that a complete and legible copy of the document was received 
by the Department.
    (d) If a document is filed by facsimile transmission, the Secretary, 
the Hearing Official, or the Panel, as applicable, may require the 
filing of a follow-up hard copy by hand-delivery or by mail within a 
reasonable period of time.
    (e) If agreed upon by the parties, service of a document may be made 
upon the other party by facsimile transmission.

(Authority: 20 U.S.C. 1413(c))



Sec. 300.586  Judicial review.

    If a State is dissatisfied with the Secretary's final action with 
respect to the eligibility of the State under section 612 of the Act, 
the State may, not later than 60 days after notice of that action, file 
with the United States Court of Appeals for the circuit in which that 
State is located a petition for review of that action. A copy of the 
petition must be forthwith transmitted by the clerk of the court to the 
Secretary. The Secretary then files in the court the record of the 
proceedings upon which the Secretary's action was based, as provided in 
section 2112 of title 28, United States Code.

(Authority: 20 U.S.C. 1416(b))



Sec. 300.587  Enforcement.

    (a) General. The Secretary initiates an action described in 
paragraph (b) of this section if the Secretary finds--
    (1) That there has been a failure by the State to comply 
substantially with any provision of Part B of the Act, this part, or 34 
CFR part 301; or
    (2) That there is a failure to comply with any condition of an LEA's 
or SEA's eligibility under Part B of the Act, this part or 34 CFR part 
301, including the terms of any agreement to achieve compliance with 
Part B of the Act, this part, or Part 301 within the timelines specified 
in the agreement.
    (b) Types of action. The Secretary, after notifying the SEA (and any 
LEA or State agency affected by a failure described in paragraph (a)(2) 
of this section)--
    (1) Withholds in whole or in part any further payments to the State 
under Part B of the Act;
    (2) Refers the matter to the Department of Justice for enforcement; 
or
    (3) Takes any other enforcement action authorized by law.
    (c) Nature of withholding. (1) If the Secretary determines that it 
is appropriate to withhold further payments under paragraph (b)(1) of 
this section, the Secretary may determine that the withholding will be 
limited to programs or projects, or portions thereof, affected by the 
failure, or that the SEA shall not make further payments under Part B of 
the Act to specified LEA or State agencies affected by the failure.
    (2) Until the Secretary is satisfied that there is no longer any 
failure to comply with the provisions of Part B of the Act, this part, 
or 34 CFR part 301, as specified in paragraph (a) of this section, 
payments to the State under Part B of the Act are withheld in whole or 
in part, or payments by the SEA under Part B of the Act are limited to 
local educational agencies and State agencies whose actions did not 
cause or were not involved in the failure, as the case may be.
    (3) Any SEA, LEA, or other State agency that has received notice 
under paragraph (a) of this section shall, by means of a public notice, 
take such measures as may be necessary to bring the pendency of an 
action pursuant to this subsection to the attention of the public within 
the jurisdiction of that agency.
    (4) Before withholding under paragraph (b)(1) of this section, the 
Secretary provides notice and a hearing pursuant to the procedures in 
Sec. Sec. 300.581-300.586.
    (d) Referral for appropriate enforcement. (1) Before the Secretary 
makes a referral under paragraph (b)(2) of this section for enforcement, 
or takes any other enforcement action authorized by law under paragraph 
(b)(3), the Secretary provides the State--
    (i) With reasonable notice; and

[[Page 85]]

    (ii) With an opportunity for a hearing.
    (2) The hearing described in paragraph (d)(1)(ii) of this section 
consists of an opportunity to meet with the Assistant Secretary for the 
Office of Special Education and Rehabilitative Services to demonstrate 
why the Department should not make a referral for enforcement.
    (e) Divided State agency responsibility. For purposes of this part, 
if responsibility for ensuring that the requirements of this part are 
met with respect to children with disabilities who are convicted as 
adults under State law and incarcerated in adult prisons is assigned to 
a public agency other than the SEA pursuant to Sec. 300.600(d), and if 
the Secretary finds that the failure to comply substantially with the 
provisions of Part B of the Act or this part are related to a failure by 
the public agency, the Secretary takes one of the enforcement actions 
described in paragraph (b) of this section to ensure compliance with 
Part B of the Act and this part, except--
    (1) Any reduction or withholding of payments to the State under 
paragraph (b)(1) of this section is proportionate to the total funds 
allotted under section 611 of the Act to the State as the number of 
eligible children with disabilities in adult prisons under the 
supervision of the other public agency is proportionate to the number of 
eligible individuals with disabilities in the State under the 
supervision of the State educational agency; and
    (2) Any withholding of funds under paragraph (e)(1) of this section 
is limited to the specific agency responsible for the failure to comply 
with Part B of the Act or this part.

(Authority: 20 U.S.C. 1416)



Sec. 300.588  [Reserved]



Sec. 300.589  Waiver of requirement regarding supplementing and not 
supplanting with Part B funds.

    (a) Except as provided under Sec. Sec. 300.232-300.235, funds paid 
to a State under Part B of the Act must be used to supplement and 
increase the level of Federal, State, and local funds (including funds 
that are not under the direct control of SEAs or LEAs) expended for 
special education and related services provided to children with 
disabilities under Part B of the Act and in no case to supplant those 
Federal, State, and local funds. A State may use funds it retains under 
Sec. 300.602 without regard to the prohibition on supplanting other 
funds (see Sec. 300.372).
    (b) If a State provides clear and convincing evidence that all 
eligible children with disabilities throughout the State have FAPE 
available to them, the Secretary may waive for a period of one year in 
whole or in part the requirement under Sec. 300.153 (regarding State-
level nonsupplanting) if the Secretary concurs with the evidence 
provided by the State.
    (c) If a State wishes to request a waiver under this section, it 
must submit to the Secretary a written request that includes--
    (1) An assurance that FAPE is currently available, and will remain 
available throughout the period that a waiver would be in effect, to all 
eligible children with disabilities throughout the State, regardless of 
the public agency that is responsible for providing FAPE to them. The 
assurance must be signed by an official who has the authority to provide 
that assurance as it applies to all eligible children with disabilities 
in the State;
    (2) All evidence that the State wishes the Secretary to consider in 
determining whether all eligible children with disabilities have FAPE 
available to them, setting forth in detail--
    (i) The basis on which the State has concluded that FAPE is 
available to all eligible children in the State; and
    (ii) The procedures that the State will implement to ensure that 
FAPE remains available to all eligible children in the State, which must 
include--
    (A) The State's procedures under Sec. 300.125 for ensuring that all 
eligible children are identified, located and evaluated;
    (B) The State's procedures for monitoring public agencies to ensure 
that they comply with all requirements of this part;
    (C) The State's complaint procedures under Sec. Sec. 300.660-
300.662; and

[[Page 86]]

    (D) The State's hearing procedures under Sec. Sec. 300.507-300.511 
and 300.520-300.528;
    (3) A summary of all State and Federal monitoring reports, and State 
complaint decisions (see Sec. Sec. 300.660-300.662) and hearing 
decisions (see Sec. Sec. 300.507-300.511 and 300.520-300.528), issued 
within three years prior to the date of the State's request for a waiver 
under this section, that includes any finding that FAPE has not been 
available to one or more eligible children, and evidence that FAPE is 
now available to all children addressed in those reports or decisions; 
and
    (4) Evidence that the State, in determining that FAPE is currently 
available to all eligible children with disabilities in the State, has 
consulted with the State advisory panel under Sec. 300.650, the State's 
parent training and information center or centers, the State's 
protection and advocacy organization, and other organizations 
representing the interests of children with disabilities and their 
parents, and a summary of the input of these organizations.
    (d) If the Secretary determines that the request and supporting 
evidence submitted by the State makes a prima facie showing that FAPE 
is, and will remain, available to all eligible children with 
disabilities in the State, the Secretary, after notice to the public 
throughout the State, conducts a public hearing at which all interested 
persons and organizations may present evidence regarding the following 
issues:
    (1) Whether FAPE is currently available to all eligible children 
with disabilities in the State.
    (2) Whether the State will be able to ensure that FAPE remains 
available to all eligible children with disabilities in the State if the 
Secretary provides the requested waiver.
    (e) Following the hearing, the Secretary, based on all submitted 
evidence, will provide a waiver, in whole or in part, for a period of 
one year if the Secretary finds that the State has provided clear and 
convincing evidence that FAPE is currently available to all eligible 
children with disabilities in the State, and the State will be able to 
ensure that FAPE remains available to all eligible children with 
disabilities in the State if the Secretary provides the requested 
waiver.
    (f) A State may receive a waiver of the requirement of section 
612(a)(19)(A) and Sec. 300.154(a) if it satisfies the requirements of 
paragraphs (b) through (e) of this section.
    (g) The Secretary may grant subsequent waivers for a period of one 
year each, if the Secretary determines that the State has provided clear 
and convincing evidence that all eligible children with disabilities 
throughout the State have, and will continue to have throughout the one-
year period of the waiver, FAPE available to them.

(Authority: 20 U.S.C. 1412(a)(18)(C), (19)(C)(ii) and (E))



                     Subpart F_State Administration

                                 General



Sec. 300.600  Responsibility for all educational programs.

    (a) The SEA is responsible for ensuring--
    (1) That the requirements of this part are carried out; and
    (2) That each educational program for children with disabilities 
administered within the State, including each program administered by 
any other State or local agency--
    (i) Is under the general supervision of the persons responsible for 
educational programs for children with disabilities in the SEA; and
    (ii) Meets the education standards of the SEA (including the 
requirements of this part).
    (b) The State must comply with paragraph (a) of this section through 
State statute, State regulation, signed agreement between respective 
agency officials, or other documents.
    (c) Part B of the Act does not limit the responsibility of agencies 
other than educational agencies for providing or paying some or all of 
the costs of FAPE to children with disabilities in the State.
    (d) Notwithstanding paragraph (a) of this section, the Governor (or 
another individual pursuant to State law) may assign to any public 
agency in the State the responsibility of ensuring that the requirements 
of Part B of the

[[Page 87]]

Act are met with respect to students with disabilities who are convicted 
as adults under State law and incarcerated in adult prisons.

(Authority: 20 U.S.C. 1412(a)(11))



Sec. 300.601  Relation of Part B to other Federal programs.

    Part B of the Act may not be construed to permit a State to reduce 
medical and other assistance available to children with disabilities, or 
to alter the eligibility of a child with a disability, under title V 
(Maternal and Child Health) or title XIX (Medicaid) of the Social 
Security Act, to receive services that are also part of FAPE.

(Authority: 20 U.S.C. 1412(e))



Sec. 300.602  State-level activities.

    (a) Each State may retain not more than the amount described in 
paragraph (b) of this section for administration in accordance with 
Sec. Sec. 300.620 and 300.621 and other State-level activities in 
accordance with Sec. 300.370.
    (b) For each fiscal year, the Secretary determines and reports to 
the SEA an amount that is 25 percent of the amount the State received 
under this section for fiscal year 1997, cumulatively adjusted by the 
Secretary for each succeeding fiscal year by the lesser of--
    (1) The percentage increase, if any, from the preceding fiscal year 
in the State's allocation under section 611 of the Act; or
    (2) The rate of inflation, as measured by the percentage increase, 
if any, from the preceding fiscal year in the Consumer Price Index For 
All Urban Consumers, published by the Bureau of Labor Statistics of the 
Department of Labor.

(Authority: 20 U.S.C. 1411(f)(1)(A) and (B))

                              Use of Funds



Sec. 300.620  Use of funds for State administration.

    (a) For the purpose of administering Part B of the Act, including 
section 619 of the Act (including the coordination of activities under 
Part B of the Act with, and providing technical assistance to, other 
programs that provide services to children with disabilities)--
    (1) Each State may use not more than twenty percent of the maximum 
amount it may retain under Sec. 300.602(a) for any fiscal year or 
$500,000 (adjusted by the cumulative rate of inflation since fiscal year 
1998, as measured by the percentage increase, if any, in the Consumer 
Price Index For All Urban Consumers, published by the Bureau of Labor 
Statistics of the Department of Labor), whichever is greater; and
    (2) Each outlying area may use up to five percent of the amount it 
receives under this section for any fiscal year or $35,000, whichever is 
greater.
    (b) Funds described in paragraph (a) of this section may also be 
used for the administration of Part C of the Act, if the SEA is the lead 
agency for the State under that part.

(Authority: 20 U.S.C. 1411(f)(2))



Sec. 300.621  Allowable costs.

    (a) The SEA may use funds under Sec. 300.620 for--
    (1) Administration of State activities under Part B of the Act and 
for planning at the State level, including planning, or assisting in the 
planning, of programs or projects for the education of children with 
disabilities;
    (2) Approval, supervision, monitoring, and evaluation of the 
effectiveness of local programs and projects for the education of 
children with disabilities;
    (3) Technical assistance to LEAs with respect to the requirements of 
Part B of the Act;
    (4) Leadership services for the program supervision and management 
of special education activities for children with disabilities; and
    (5) Other State leadership activities and consultative services.
    (b) The SEA shall use the remainder of its funds under Sec. 300.620 
in accordance with Sec. 300.370.

(Authority: 20 U.S.C. 1411(f)(2))



Sec. 300.622  Subgrants to LEAs for capacity-building and improvement.

    In any fiscal year in which the percentage increase in the State's 
allocation under 611 of the Act exceeds the rate of inflation (as 
measured by the percentage increase, if any, from the preceding fiscal 
year in the Consumer

[[Page 88]]

Price Index For All Urban Consumers, published by the Bureau of Labor 
Statistics of the Department of Labor), each State shall reserve, from 
its allocation under 611 of the Act, the amount described in Sec. 
300.623 to make subgrants to LEAs, unless that amount is less than 
$100,000, to assist them in providing direct services and in making 
systemic change to improve results for children with disabilities 
through one or more of the following:
    (a) Direct services, including alternative programming for children 
who have been expelled from school, and services for children in 
correctional facilities, children enrolled in State-operated or State-
supported schools, and children in charter schools.
    (b) Addressing needs or carrying out improvement strategies 
identified in the State's Improvement Plan under subpart 1 of Part D of 
the Act.
    (c) Adopting promising practices, materials, and technology, based 
on knowledge derived from education research and other sources.
    (d) Establishing, expanding, or implementing interagency agreements 
and arrangements between LEAs and other agencies or organizations 
concerning the provision of services to children with disabilities and 
their families.
    (e) Increasing cooperative problem-solving between parents and 
school personnel and promoting the use of alternative dispute 
resolution.

(Authority: 20 U.S.C. 1411(f)(4)(A))



Sec. 300.623  Amount required for subgrants to LEAs.

    For each fiscal year, the amount referred to in Sec. 300.622 is--
    (a) The maximum amount the State was allowed to retain under Sec. 
300.602(a) for the prior fiscal year, or, for fiscal year 1998, 25 
percent of the State's allocation for fiscal year 1997 under section 
611; multiplied by
    (b) The difference between the percentage increase in the State's 
allocation under this section and the rate of inflation, as measured by 
the percentage increase, if any, from the preceding fiscal year in the 
Consumer Price Index For All Urban Consumers, published by the Bureau of 
Labor Statistics of the Department of Labor.

(Authority: 20 U.S.C. 1411(f)(4)(B))



Sec. 300.624  State discretion in awarding subgrants.

    The State may establish priorities in awarding subgrants under Sec. 
300.622 to LEAs competitively or on a targeted basis.

(Authority: 20 U.S.C. 1411(f)(4)(A))

                          State Advisory Panel



Sec. 300.650  Establishment of advisory panels.

    (a) Each State shall establish and maintain, in accordance with 
Sec. Sec. 300.650-300.653, a State advisory panel on the education of 
children with disabilities.
    (b) The advisory panel must be appointed by the Governor or any 
other official authorized under State law to make those appointments.
    (c) If a State has an existing advisory panel that can perform the 
functions in Sec. 300.652, the State may modify the existing panel so 
that it fulfills all of the requirements of Sec. Sec. 300.650-300.653, 
instead of establishing a new advisory panel.

(Authority: 20 U.S.C. 1412(a)(21)(A))



Sec. 300.651  Membership.

    (a) General. The membership of the State advisory panel must consist 
of members appointed by the Governor, or any other official authorized 
under State law to make these appointments, that is representative of 
the State population and that is composed of individuals involved in, or 
concerned with the education of children with disabilities, including--
    (1) Parents of children with disabilities;
    (2) Individuals with disabilities;
    (3) Teachers;
    (4) Representatives of institutions of higher education that prepare 
special education and related services personnel;
    (5) State and local education officials;
    (6) Administrators of programs for children with disabilities;
    (7) Representatives of other State agencies involved in the 
financing or

[[Page 89]]

delivery of related services to children with disabilities;
    (8) Representatives of private schools and public charter schools;
    (9) At least one representative of a vocational, community, or 
business organization concerned with the provision of transition 
services to children with disabilities; and
    (10) Representatives from the State juvenile and adult corrections 
agencies.
    (b) Special rule. A majority of the members of the panel must be 
individuals with disabilities or parents of children with disabilities.

(Authority: 20 U.S.C. 1412(a)(21)(B) and (C))



Sec. 300.652  Advisory panel functions.

    (a) General. The State advisory panel shall--
    (1) Advise the SEA of unmet needs within the State in the education 
of children with disabilities;
    (2) Comment publicly on any rules or regulations proposed by the 
State regarding the education of children with disabilities;
    (3) Advise the SEA in developing evaluations and reporting on data 
to the Secretary under section 618 of the Act;
    (4) Advise the SEA in developing corrective action plans to address 
findings identified in Federal monitoring reports under Part B of the 
Act; and
    (5) Advise the SEA in developing and implementing policies relating 
to the coordination of services for children with disabilities.
    (b) Advising on eligible students with disabilities in adult 
prisons. The advisory panel also shall advise on the education of 
eligible students with disabilities who have been convicted as adults 
and incarcerated in adult prisons, even if, consistent with Sec. 
300.600(d), a State assigns general supervision responsibility for those 
students to a public agency other than an SEA.

(Authority: 20 U.S.C. 1412(a)(21)(D))



Sec. 300.653  Advisory panel procedures.

    (a) The advisory panel shall meet as often as necessary to conduct 
its business.
    (b) By July 1 of each year, the advisory panel shall submit an 
annual report of panel activities and suggestions to the SEA. This 
report must be made available to the public in a manner consistent with 
other public reporting requirements of Part B of the Act.
    (c) Official minutes must be kept on all panel meetings and must be 
made available to the public on request.
    (d) All advisory panel meetings and agenda items must be announced 
enough in advance of the meeting to afford interested parties a 
reasonable opportunity to attend. Meetings must be open to the public.
    (e) Interpreters and other necessary services must be provided at 
panel meetings for panel members or participants. The State may pay for 
these services from funds under Sec. 300.620.
    (f) The advisory panel shall serve without compensation but the 
State must reimburse the panel for reasonable and necessary expenses for 
attending meetings and performing duties. The State may use funds under 
Sec. 300.620 for this purpose.

(Authority: 20 U.S.C. 1412(a)(21))

                       State Complaint Procedures



Sec. 300.660  Adoption of State complaint procedures.

    (a) General. Each SEA shall adopt written procedures for--
    (1) Resolving any complaint, including a complaint filed by an 
organization or individual from another State, that meets the 
requirements of Sec. 300.662 by--
    (i) Providing for the filing of a complaint with the SEA; and
    (ii) At the SEA's discretion, providing for the filing of a 
complaint with a public agency and the right to have the SEA review the 
public agency's decision on the complaint; and
    (2) Widely disseminating to parents and other interested 
individuals, including parent training and information centers, 
protection and advocacy agencies, independent living centers, and other 
appropriate entities, the State's procedures under Sec. Sec. 300.660-
300.662.
    (b) Remedies for denial of appropriate services. In resolving a 
complaint in which it has found a failure to provide appropriate 
services, an SEA, pursuant

[[Page 90]]

to its general supervisory authority under Part B of the Act, must 
address:
    (1) How to remediate the denial of those services, including, as 
appropriate, the awarding of monetary reimbursement or other corrective 
action appropriate to the needs of the child; and
    (2) Appropriate future provision of services for all children with 
disabilities.

(Authority: 20 U.S.C. 1221e-3)



Sec. 300.661  Minimum State complaint procedures.

    (a) Time limit; minimum procedures. Each SEA shall include in its 
complaint procedures a time limit of 60 days after a complaint is filed 
under Sec. 300.660(a) to--
    (1) Carry out an independent on-site investigation, if the SEA 
determines that an investigation is necessary;
    (2) Give the complainant the opportunity to submit additional 
information, either orally or in writing, about the allegations in the 
complaint;
    (3) Review all relevant information and make an independent 
determination as to whether the public agency is violating a requirement 
of Part B of the Act or of this part; and
    (4) Issue a written decision to the complainant that addresses each 
allegation in the complaint and contains--
    (i) Findings of fact and conclusions; and
    (ii) The reasons for the SEA's final decision.
    (b) Time extension; final decision; implementation. The SEA's 
procedures described in paragraph (a) of this section also must--
    (1) Permit an extension of the time limit under paragraph (a) of 
this section only if exceptional circumstances exist with respect to a 
particular complaint; and
    (2) Include procedures for effective implementation of the SEA's 
final decision, if needed, including--
    (i) Technical assistance activities;
    (ii) Negotiations; and
    (iii) Corrective actions to achieve compliance.
    (c) Complaints filed under this section, and due process hearings 
under Sec. Sec. 300.507 and 300.520-300.528. (1) If a written complaint 
is received that is also the subject of a due process hearing under 
Sec. 300.507 or Sec. Sec. 300.520-300.528, or contains multiple 
issues, of which one or more are part of that hearing, the State must 
set aside any part of the complaint that is being addressed in the due 
process hearing, until the conclusion of the hearing. However, any issue 
in the complaint that is not a part of the due process action must be 
resolved using the time limit and procedures described in paragraphs (a) 
and (b) of this section.
    (2) If an issue is raised in a complaint filed under this section 
that has previously been decided in a due process hearing involving the 
same parties--
    (i) The hearing decision is binding; and
    (ii) The SEA must inform the complainant to that effect.
    (3) A complaint alleging a public agency's failure to implement a 
due process decision must be resolved by the SEA.

(Authority: 20 U.S.C. 1221e-3)



Sec. 300.662  Filing a complaint.

    (a) An organization or individual may file a signed written 
complaint under the procedures described in Sec. Sec. 300.660-300.661.
    (b) The complaint must include--
    (1) A statement that a public agency has violated a requirement of 
Part B of the Act or of this part; and
    (2) The facts on which the statement is based.
    (c) The complaint must allege a violation that occurred not more 
than one year prior to the date that the complaint is received in 
accordance with Sec. 300.660(a) unless a longer period is reasonable 
because the violation is continuing, or the complainant is requesting 
compensatory services for a violation that occurred not more than three 
years prior to the date the complaint is received under Sec. 
300.660(a).

(Authority: 20 U.S.C. 1221e-3)

[[Page 91]]



                 Subpart G_Allocation of Funds; Reports

                               Allocations



Sec. 300.700  Special definition of the term ``State''.

    For the purposes of Sec. Sec. 300.701, and 300.703-300.714, the 
term State means each of the 50 States, the District of Columbia, and 
the Commonwealth of Puerto Rico.

(Authority: 20 U.S.C. 1411(h)(2))



Sec. 300.701  Grants to States.

    (a) Purpose of grants. The Secretary makes grants to States and the 
outlying areas and provides funds to the Secretary of the Interior, to 
assist them to provide special education and related services to 
children with disabilities in accordance with Part B of the Act.
    (b) Maximum amounts. The maximum amount of the grant a State may 
receive under section 611 of the Act for any fiscal year is--
    (1) The number of children with disabilities in the State who are 
receiving special education and related services--
    (i) Aged 3 through 5 if the State is eligible for a grant under 
section 619 of the Act; and
    (ii) Aged 6 through 21; multiplied by--
    (2) Forty (40) percent of the average per-pupil expenditure in 
public elementary and secondary schools in the United States.

(Authority: 20 U.S.C. 1411(a))



Sec. 300.702  Definition.

    For the purposes of this section the term average per-pupil 
expenditure in public elementary and secondary schools in the United 
States means--
    (a) Without regard to the source of funds--
    (1) The aggregate current expenditures, during the second fiscal 
year preceding the fiscal year for which the determination is made (or, 
if satisfactory data for that year are not available, during the most 
recent preceding fiscal year for which satisfactory data are available) 
of all LEAs in the 50 States and the District of Columbia); plus
    (2) Any direct expenditures by the State for the operation of those 
agencies; divided by
    (b) The aggregate number of children in average daily attendance to 
whom those agencies provided free public education during that preceding 
year.

(Authority: 20 U.S.C. 1411(h)(1))



Sec. 300.703  Allocations to States.

    (a) General. After reserving funds for studies and evaluations under 
section 674(e) of the Act, and for payments to the outlying areas, the 
freely associated States, and the Secretary of the Interior under 
Sec. Sec. 300.715 and 300.717-300.719, the Secretary allocates the 
remaining amount among the States in accordance with paragraph (b) of 
this section and Sec. Sec. 300.706-300.709.
    (b) Interim formula. Except as provided in Sec. Sec. 300.706-
300.709, the Secretary allocates the amount described in paragraph (a) 
of this section among the States in accordance with section 611(a)(3), 
(4), (5) and (b)(1), (2) and (3) of the Act, as in effect prior to June 
4, 1997, except that the determination of the number of children with 
disabilities receiving special education and related services under 
section 611(a)(3) of the Act (as then in effect) may be calculated as of 
December 1, or, at the State's discretion, the last Friday in October, 
of the fiscal year for which the funds were appropriated.

(Authority: 20 U.S.C. 1411(d))



Sec. Sec. 300.704-300.705  [Reserved]



Sec. 300.706  Permanent formula.

    (a) Establishment of base year. The Secretary allocates the amount 
described in Sec. 300.703(a) among the States in accordance with 
Sec. Sec. 300.706-300.709 for each fiscal year beginning with the first 
fiscal year for which the amount appropriated under 611(j) of the Act is 
more than $4,924,672,200.
    (b) Use of base year. (1) Definition. As used in this section, the 
term base year means the fiscal year preceding the first fiscal year in 
which this section applies.
    (2) Special rule for use of base year amount. If a State received 
any funds

[[Page 92]]

under section 611 of the Act for the base year on the basis of children 
aged 3 through 5, but does not make FAPE available to all children with 
disabilities aged 3 through 5 in the State in any subsequent fiscal 
year, the Secretary computes the State's base year amount, solely for 
the purpose of calculating the State's allocation in that subsequent 
year under Sec. Sec. 300.707-300.709, by subtracting the amount 
allocated to the State for the base year on the basis of those children.

(Authority: 20 U.S.C. 1411(e)(1) and (2))



Sec. 300.707  Increase in funds.

    If the amount available for allocations to States under Sec. 
300.706 is equal to or greater than the amount allocated to the States 
under section 611 of the Act for the preceding fiscal year, those 
allocations are calculated as follows:
    (a) Except as provided in Sec. 300.708, the Secretary--
    (1) Allocates to each State the amount it received for the base 
year;
    (2) Allocates 85 percent of any remaining funds to States on the 
basis of their relative populations of children aged 3 through 21 who 
are of the same age as children with disabilities for whom the State 
ensures the availability of FAPE under Part B of the Act; and
    (3) Allocates 15 percent of those remaining funds to States on the 
basis of their relative populations of children described in paragraph 
(a)(2) of this section who are living in poverty.
    (b) For the purpose of making grants under this section, the 
Secretary uses the most recent population data, including data on 
children living in poverty, that are available and satisfactory to the 
Secretary.

(Authority: 20 U.S.C. 1411(e)(3))



Sec. 300.708  Limitation.

    (a) Allocations under Sec. 300.707 are subject to the following:
    (1) No State's allocation may be less than its allocation for the 
preceding fiscal year.
    (2) No State's allocation may be less than the greatest of--
    (i) The sum of--
    (A) The amount it received for the base year; and
    (B) One-third of one percent of the amount by which the amount 
appropriated under section 611(j) of the Act exceeds the amount 
appropriated under section 611 of the Act for the base year; or
    (ii) The sum of--
    (A) The amount it received for the preceding fiscal year; and
    (B) That amount multiplied by the percentage by which the increase 
in the funds appropriated from the preceding fiscal year exceeds 1.5 
percent; or
    (iii) The sum of--
    (A) The amount it received for the preceding fiscal year; and
    (B) That amount multiplied by 90 percent of the percentage increase 
in the amount appropriated from the preceding fiscal year.
    (b) Notwithstanding paragraph (a)(2) of this section, no State's 
allocation under Sec. 300.707 may exceed the sum of--
    (1) The amount it received for the preceding fiscal year; and
    (2) That amount multiplied by the sum of 1.5 percent and the 
percentage increase in the amount appropriated.
    (c) If the amount available for allocations to States under Sec. 
300.703 and paragraphs (a) and (b) of this section is insufficient to 
pay those allocations in full those allocations are ratably reduced, 
subject to paragraph (a)(1) of this section.

(Authority: 20 U.S.C. 1411(e)(3)(B) and (C))



Sec. 300.709  Decrease in funds.

    If the amount available for allocations to States under Sec. 
300.706 is less than the amount allocated to the States under section 
611 of the Act for the preceding fiscal year, those allocations are 
calculated as follows:
    (a) If the amount available for allocations is greater than the 
amount allocated to the States for the base year, each State is 
allocated the sum of--
    (1) The amount it received for the base year; and
    (2) An amount that bears the same relation to any remaining funds as 
the increase the State received for the preceding fiscal year over the 
base year bears to the total of those increases for all States.

[[Page 93]]

    (b)(1) If the amount available for allocations is equal to or less 
than the amount allocated to the States for the base year, each State is 
allocated the amount it received for the base year.
    (2) If the amount available is insufficient to make the allocations 
described in paragraph (b)(1) of this section, those allocations are 
ratably reduced.

(Authority: 20 U.S.C. 1411(e)(4))



Sec. 300.710  Allocation for State in which by-pass is implemented for 
private school children with disabilities.

    In determining the allocation under Sec. Sec. 300.700-300.709 of a 
State in which the Secretary will implement a by-pass for private school 
children with disabilities under Sec. Sec. 300.451-300.487, the 
Secretary includes in the State's child count--
    (a) For the first year of a by-pass, the actual or estimated number 
of private school children with disabilities (as defined in Sec. Sec. 
300.7(a) and 300.450) in the State, as of the preceding December 1; and
    (b) For succeeding years of a by-pass, the number of private school 
children with disabilities who received special education and related 
services under the by-pass in the preceding year.

(Authority: 20 U.S.C. 1412(f)(2))



Sec. 300.711  Subgrants to LEAs.

    Each State that receives a grant under section 611 of the Act for 
any fiscal year shall distribute in accordance with Sec. 300.712 any 
funds it does not retain under Sec. 300.602 and is not required to 
distribute under Sec. Sec. 300.622 and 300.623 to LEAs in the State 
that have established their eligibility under section 613 of the Act, 
and to State agencies that received funds under section 614A(a) of the 
Act for fiscal year 1997, as then in effect, and have established their 
eligibility under section 613 of the Act, for use in accordance with 
Part B of the Act.

(Authority: 20 U.S.C. 1411(g)(1))



Sec. 300.712  Allocations to LEAs.

    (a) Interim procedure. For each fiscal year for which funds are 
allocated to States under Sec. 300.703(b) each State shall allocate 
funds under Sec. 300.711 in accordance with section 611(d) of the Act, 
as in effect prior to June 4, 1997.
    (b) Permanent procedure. For each fiscal year for which funds are 
allocated to States under Sec. Sec. 300.706-300.709, each State shall 
allocate funds under Sec. 300.711 as follows:
    (1) Base payments. The State first shall award each agency described 
in Sec. 300.711 the amount that agency would have received under this 
section for the base year, as defined in Sec. 300.706(b)(1), if the 
State had distributed 75 percent of its grant for that year under 
section Sec. 300.703(b).
    (2) Base payment adjustments. For any fiscal year after the base 
year fiscal year--
    (i) If a new LEA is created, the State shall divide the base 
allocation determined under paragraph (b)(1) of this section for the 
LEAs that would have been responsible for serving children with 
disabilities now being served by the new LEA, among the new LEA and 
affected LEAs based on the relative numbers of children with 
disabilities ages 3 through 21, or ages 6 through 21 if a State has had 
its payment reduced under Sec. 300.706(b)(2), currently provided 
special education by each of the LEAs;
    (ii) If one or more LEAs are combined into a single new LEA, the 
State shall combine the base allocations of the merged LEAs; and
    (iii) If, for two or more LEAs, geographic boundaries or 
administrative responsibility for providing services to children with 
disabilities ages 3 through 21 change, the base allocations of affected 
LEAs shall be redistributed among affected LEAs based on the relative 
numbers of children with disabilities ages 3 through 21, or ages 6 
through 21 if a State has had its payment reduced under Sec. 
300.706(b)(2), currently provided special education by each affected 
LEA.
    (3) Allocation of remaining funds. The State then shall--
    (i) Allocate 85 percent of any remaining funds to those agencies on 
the basis of the relative numbers of children enrolled in public and 
private elementary and secondary schools within each agency's 
jurisdiction; and
    (ii) Allocate 15 percent of those remaining funds to those agencies 
in accordance with their relative numbers

[[Page 94]]

of children living in poverty, as determined by the SEA.
    (iii) For the purposes of making grants under this section, States 
must apply on a uniform basis across all LEAs the best data that are 
available to them on the numbers of children enrolled in public and 
private elementary and secondary schools and the numbers of children 
living in poverty.

(Authority: 20 U.S.C. 1411(g)(2))



Sec. 300.713  Former Chapter 1 State agencies.

    (a) To the extent necessary, the State--
    (1) Shall use funds that are available under Sec. 300.602(a) to 
ensure that each State agency that received fiscal year 1994 funds under 
subpart 2 of Part D of chapter 1 of title I of the Elementary and 
Secondary Education Act of 1965 (as in effect in fiscal year 1994) 
receives, from the combination of funds under Sec. 300.602(a) and funds 
provided under Sec. 300.711, an amount no less than--
    (i) The number of children with disabilities, aged 6 through 21, to 
whom the agency was providing special education and related services on 
December 1, or, at the State's discretion, the last Friday in October, 
of the fiscal year for which the funds were appropriated, subject to the 
limitation in paragraph (b) of this section; multiplied by
    (ii) The per-child amount provided under that subpart for fiscal 
year 1994; and
    (2) May use funds under Sec. 300.602(a) to ensure that each LEA 
that received fiscal year 1994 funds under that subpart for children who 
had transferred from a State-operated or State-supported school or 
program assisted under that subpart receives, from the combination of 
funds available under Sec. 300.602(a) and funds provided under Sec. 
300.711, an amount for each child, aged 3 through 21 to whom the agency 
was providing special education and related services on December 1, or, 
at the State's discretion, the last Friday in October, of the fiscal 
year for which the funds were appropriated, equal to the per-child 
amount the agency received under that subpart for fiscal year 1994.
    (b) The number of children counted under paragraph (a)(1)(i) of this 
section may not exceed the number of children aged 3 through 21 for whom 
the agency received fiscal year 1994 funds under subpart 2 of Part D of 
chapter 1 of title I of the Elementary and Secondary Education Act of 
1965 (as in effect in fiscal year 1994).

(Authority: 20 U.S.C. 1411(g)(3))



Sec. 300.714  Reallocation of LEA funds.

    If an SEA determines that an LEA is adequately providing FAPE to all 
children with disabilities residing in the area served by that agency 
with State and local funds, the SEA may reallocate any portion of the 
funds under Part B of the Act that are not needed by that local agency 
to provide FAPE to other LEAs in the State that are not adequately 
providing special education and related services to all children with 
disabilities residing in the areas they serve.

(Authority: 20 U.S.C. 1411(g)(4))



Sec. 300.715  Payments to the Secretary of the Interior for the education 
of Indian children.

    (a) Reserved amounts for Secretary of Interior. From the amount 
appropriated for any fiscal year under 611(j) of the Act, the Secretary 
reserves 1.226 percent to provide assistance to the Secretary of the 
Interior in accordance with this section and Sec. 300.716.
    (b) Provision of amounts for assistance. The Secretary provides 
amounts to the Secretary of the Interior to meet the need for assistance 
for the education of children with disabilities on reservations aged 5 
to 21, inclusive, enrolled in elementary and secondary schools for 
Indian children operated or funded by the Secretary of the Interior. The 
amount of the payment for any fiscal year is equal to 80 percent of the 
amount allotted under paragraph (a) of this section for that fiscal 
year.
    (c) Calculation of number of children. In the case of Indian 
students aged 3 to 5, inclusive, who are enrolled in programs affiliated 
with the Bureau of Indian Affairs (BIA) schools and that are required by 
the States in which these schools are located to attain or maintain 
State accreditation, and which

[[Page 95]]

schools have this accreditation prior to the date of enactment of the 
Individuals with Disabilities Education Act Amendments of 1991, the 
school may count those children for the purpose of distribution of the 
funds provided under this section to the Secretary of the Interior.
    (d) Responsibility for meeting the requirements of Part B. The 
Secretary of the Interior shall meet all of the requirements of Part B 
of the Act for the children described in paragraphs (b) and (c) of this 
section, in accordance with Sec. 300.260.

(Authority: 20 U.S.C. 1411(c); 1411(i)(1)(A) and (B))



Sec. 300.716  Payments for education and services for Indian children 
with disabilities aged 3 through 5.

    (a) General. With funds appropriated under 611(j) of the Act, the 
Secretary makes payments to the Secretary of the Interior to be 
distributed to tribes or tribal organizations (as defined under section 
4 of the Indian Self-Determination and Education Assistance Act) or 
consortia of those tribes or tribal organizations to provide for the 
coordination of assistance for special education and related services 
for children with disabilities aged 3 through 5 on reservations served 
by elementary and secondary schools for Indian children operated or 
funded by the Department of the Interior. The amount of the payments 
under paragraph (b) of this section for any fiscal year is equal to 20 
percent of the amount allotted under Sec. 300.715(a).
    (b) Distribution of funds. The Secretary of the Interior shall 
distribute the total amount of the payment under paragraph (a) of this 
section by allocating to each tribe or tribal organization an amount 
based on the number of children with disabilities ages 3 through 5 
residing on reservations as reported annually, divided by the total of 
those children served by all tribes or tribal organizations.
    (c) Submission of information. To receive a payment under this 
section, the tribe or tribal organization shall submit the figures to 
the Secretary of the Interior as required to determine the amounts to be 
allocated under paragraph (b) of this section. This information must be 
compiled and submitted to the Secretary.
    (d) Use of funds. (1) The funds received by a tribe or tribal 
organization must be used to assist in child find, screening, and other 
procedures for the early identification of children aged 3 through 5, 
parent training, and the provision of direct services. These activities 
may be carried out directly or through contracts or cooperative 
agreements with the BIA, LEAs, and other public or private nonprofit 
organizations. The tribe or tribal organization is encouraged to involve 
Indian parents in the development and implementation of these 
activities.
    (2) The entities shall, as appropriate, make referrals to local, 
State, or Federal entities for the provision of services or further 
diagnosis.
    (e) Biennial report. To be eligible to receive a grant pursuant to 
paragraph (a) of this section, the tribe or tribal organization shall 
provide to the Secretary of the Interior a biennial report of activities 
undertaken under this paragraph, including the number of contracts and 
cooperative agreements entered into, the number of children contacted 
and receiving services for each year, and the estimated number of 
children needing services during the two years following the one in 
which the report is made. The Secretary of the Interior shall include a 
summary of this information on a biennial basis in the report to the 
Secretary required under section 611(i) of the Act. The Secretary may 
require any additional information from the Secretary of the Interior.
    (f) Prohibitions. None of the funds allocated under this section may 
be used by the Secretary of the Interior for administrative purposes, 
including child count and the provision of technical assistance.

(Authority: 20 U.S.C. 1411(i)(3))



Sec. 300.717  Outlying areas and freely associated States.

    From the amount appropriated for any fiscal year under section 
611(j) of the Act, the Secretary reserves not more than one percent, 
which must be used--

[[Page 96]]

    (a) To provide assistance to the outlying areas in accordance with 
their respective populations of individuals aged 3 through 21; and
    (b) For fiscal years 1998 through 2001, to carry out the competition 
described in Sec. 300.719, except that the amount reserved to carry out 
that competition may not exceed the amount reserved for fiscal year 1996 
for the competition under Part B of the Act described under the heading 
``SPECIAL EDUCATION'' in Public Law 104-134.

(Authority: 20 U.S.C. 1411(b)(1))



Sec. 300.718  Outlying area--definition.

    As used in this part, the term outlying area means the United States 
Virgin Islands, Guam, American Samoa, and the Commonwealth of the 
Northern Mariana Islands.

(Authority: 20 U.S.C. 1402(18))



Sec. 300.719  Limitation for freely associated States.

    (a) Competitive grants. The Secretary uses funds described in Sec. 
300.717(b) to award grants, on a competitive basis, to Guam, American 
Samoa, the Commonwealth of the Northern Mariana Islands, and the freely 
associated States to carry out the purposes of this part.
    (b) Award basis. The Secretary awards grants under paragraph (a) of 
this section on a competitive basis, pursuant to the recommendations of 
the Pacific Region Educational Laboratory in Honolulu, Hawaii. Those 
recommendations must be made by experts in the field of special 
education and related services.
    (c) Assistance requirements. Any freely associated State that wishes 
to receive funds under Part B of the Act shall include, in its 
application for assistance--
    (1) Information demonstrating that it will meet all conditions that 
apply to States under Part B of the Act;
    (2) An assurance that, notwithstanding any other provision of Part B 
of the Act, it will use those funds only for the direct provision of 
special education and related services to children with disabilities and 
to enhance its capacity to make FAPE available to all children with 
disabilities;
    (3) The identity of the source and amount of funds, in addition to 
funds under Part B of the Act, that it will make available to ensure 
that FAPE is available to all children with disabilities within its 
jurisdiction; and
    (4) Such other information and assurances as the Secretary may 
require.
    (d) Termination of eligibility. Notwithstanding any other provision 
of law, the freely associated States may not receive any funds under 
Part B of the Act for any program year that begins after September 30, 
2001.
    (e) Administrative costs. The Secretary may provide not more than 
five percent of the amount reserved for grants under this section to pay 
the administrative costs of the Pacific Region Educational Laboratory 
under paragraph (b) of this section.
    (f) Eligibility for award. An outlying area is not eligible for a 
competitive award under Sec. 300.719 unless it receives assistance 
under Sec. 300.717(a).

(Authority: 20 U.S.C. 1411(b)(2) and (3))



Sec. 300.720  Special rule.

    The provisions of Public Law 95-134, permitting the consolidation of 
grants by the outlying areas, do not apply to funds provided to those 
areas or to the freely associated States under Part B of the Act.

(Authority: 20 U.S.C. 1411(b)(4))



Sec. 300.721  [Reserved]



Sec. 300.722  Definition.

    As used in this part, the term freely associated States means the 
Republic of the Marshall Islands, the Federated States of Micronesia, 
and the Republic of Palau.

(Authority: 20 U.S.C. 1411(b)(6))

                                 Reports



Sec. 300.750  Annual report of children served--report requirement.

    (a) The SEA shall report to the Secretary no later than February 1 
of each year the number of children with disabilities aged 3 through 21 
residing in the State who are receiving special education and related 
services.

[[Page 97]]

    (b) The SEA shall submit the report on forms provided by the 
Secretary.

(Authority: 20 U.S.C. 1411(d)(2); 1418(a))



Sec. 300.751  Annual report of children served--information required 
in the report.

    (a) For any year the SEA shall include in its report a table that 
shows the number of children with disabilities receiving special 
education and related services on December 1, or at the State's 
discretion on the last Friday in October, of that school year--
    (1) Aged 3 through 5;
    (2) Aged 6 through 17; and
    (3) Aged 18 through 21.
    (b) For the purpose of this part, a child's age is the child's 
actual age on the date of the child count: December 1, or, at the 
State's discretion, the last Friday in October.
    (c) Reports must also include the number of those children with 
disabilities aged 3 through 21 for each year of age (3, 4, 5, etc.) 
within each disability category, as defined in the definition of 
``children with disabilities'' in Sec. 300.7; and
    (d) The Secretary may permit the collection of the data in paragraph 
(c) of this section through sampling.
    (e) The SEA may not report a child under paragraph (c) of this 
section under more than one disability category.
    (f) If a child with a disability has more than one disability, the 
SEA shall report that child under paragraph (c) of this section in 
accordance with the following procedure:
    (1) If a child has only two disabilities and those disabilities are 
deafness and blindness, and the child is not reported as having a 
developmental delay, that child must be reported under the category 
``deaf-blindness''.
    (2) A child who has more than one disability and is not reported as 
having deaf-blindness or as having a developmental delay must be 
reported under the category ``multiple disabilities''.

(Authority: 20 U.S.C. 1411(d)(2); 1418(a) and (b))



Sec. 300.752  Annual report of children served--certification.

    The SEA shall include in its report a certification signed by an 
authorized official of the agency that the information provided under 
Sec. 300.751(a) is an accurate and unduplicated count of children with 
disabilities receiving special education and related services on the 
dates in question.

(Authority: 20 U.S.C. 1411(d)(2); 1417(b))



Sec. 300.753  Annual report of children served--criteria for counting 
children.

    (a) The SEA may include in its report children with disabilities who 
are enrolled in a school or program that is operated or supported by a 
public agency, and that--
    (1) Provides them with both special education and related services 
that meet State standards;
    (2) Provides them only with special education, if a related service 
is not required, that meets State standards; or
    (3) In the case of children with disabilities enrolled by their 
parents in private schools, provides them with special education or 
related services under Sec. Sec. 300.452-300.462 that meet State 
standards.
    (b) The SEA may not include children with disabilities in its report 
who are receiving special education funded solely by the Federal 
Government, including children served by the Department of Interior, the 
Department of Defense, or the Department of Education. However, the 
State may count children covered under Sec. 300.184(c)(2).

(Authority: 20 U.S.C. 1411(d)(2); 1417(b))



Sec. 300.754  Annual report of children served--other responsibilities 
of the SEA.

    In addition to meeting the other requirements of Sec. Sec. 300.750-
300.753, the SEA shall--
    (a) Establish procedures to be used by LEAs and other educational 
institutions in counting the number of children with disabilities 
receiving special education and related services;
    (b) Set dates by which those agencies and institutions must report 
to the SEA to ensure that the State complies with Sec. 300.750(a);
    (c) Obtain certification from each agency and institution that an 
unduplicated and accurate count has been made;

[[Page 98]]

    (d) Aggregate the data from the count obtained from each agency and 
institution, and prepare the reports required under Sec. Sec. 300.750-
300.753; and
    (e) Ensure that documentation is maintained that enables the State 
and the Secretary to audit the accuracy of the count.

(Authority: 20 U.S.C. 1411(d)(2); 1417(b))



Sec. 300.755  Disproportionality.

    (a) General. Each State that receives assistance under Part B of the 
Act, and the Secretary of the Interior, shall provide for the collection 
and examination of data to determine if significant disproportionality 
based on race is occurring in the State or in the schools operated by 
the Secretary of the Interior with respect to--
    (1) The identification of children as children with disabilities, 
including the identification of children as children with disabilities 
in accordance with a particular impairment described in section 602(3) 
of the Act; and
    (2) The placement in particular educational settings of these 
children.
    (b) Review and revision of policies, practices, and procedures. In 
the case of a determination of significant disproportionality with 
respect to the identification of children as children with disabilities, 
or the placement in particular educational settings of these children, 
in accordance with paragraph (a) of this section, the State or the 
Secretary of the Interior shall provide for the review and, if 
appropriate revision of the policies, procedures, and practices used in 
the identification or placement to ensure that the policies, procedures, 
and practices comply with the requirements of Part B of the Act.

(Authority: 20 U.S.C. 1418(c))



Sec. 300.756  Acquisition of equipment; construction or alteration of 
facilities.

    (a) General. If the Secretary determines that a program authorized 
under Part B of the Act would be improved by permitting program funds to 
be used to acquire appropriate equipment, or to construct new facilities 
or alter existing facilities, the Secretary may allow the use of those 
funds for those purposes.
    (b) Compliance with certain regulations. Any construction of new 
facilities or alteration of existing facilities under paragraph (a) of 
this section must comply with the requirements of--
    (1) Appendix A of part 36 of title 28, Code of Federal Regulations 
(commonly known as the ``Americans with Disabilities Accessibility 
Guidelines for Buildings and Facilities''); or
    (2) Appendix A of part 101-19.6 of title 41, Code of Federal 
Regulations (commonly known as the ``Uniform Federal Accessibility 
Standards'').

(Authority: 20 U.S.C. 1405)

            Appendix A to Part 300--Notice of Interpretation

   I. Involvement and Progress of Each Child With a Disability in the 
                           General Curriculum

    1. What are the major Part B IEP requirements that govern the 
involvement and progress of children with disabilities in the general 
curriculum?
    2. Must a child's IEP address his or her involvement in the general 
curriculum, regardless of the nature and severity of the child's 
disability and the setting in which the child is educated?
    3. What must public agencies do to meet the requirements at 
Sec. Sec. 300.344(a)(2) and 300.346(d) regarding the participation of a 
``regular education teacher'' in the development review, and revision of 
the IEPs, for children age 3 through 5 who are receiving special 
education and related services?
    4. Must the measurable annual goals in a child's IEP address all 
areas of the general curriculum, or only those areas in which the 
child's involvement and progress are affected by the child's disability?

                 II. Involvement of Parents and Students

    5. What is the role of the parents, including surrogate parents, in 
decisions regarding the educational program of their children?
    6. What are the Part B requirements regarding the participation of a 
student (child) with a disability in an IEP meeting?
    7. Must the public agency inform the parents of who will be at the 
IEP meeting?
    8. Do parents have the right to a copy of their child's IEP?
    9. What is a public agency's responsibility if it is not possible to 
reach consensus on what services should be included in a child's IEP?
    10. Does Part B require that public agencies inform parents 
regarding the educational progress of their children with disabilities?

[[Page 99]]

III. Preparing Students With Disabilities for Employment and Other Post-
                           School Experiences

    11. What must the IEP team do to meet the requirements that the IEP 
include a statement of ``transition service needs'' beginning at age 14 
(Sec. 300.347(b)(1), and a statement of ``needed transition services'' 
beginning at age 16 (Sec. 300.347(b)(2)?
    12. Must the IEP for each student with a disability, beginning no 
later than age 16, include all ``needed transition services,'' as 
identified by the IEP team and consistent with the definition at Sec. 
300.29, even if an agency other than the public agency will provide 
those services? What is the public agency's responsibility if another 
agency fails to provide agreed-upon transition services?
    13. Under what circumstances must a public agency invite 
representatives from other agencies to an IEP meeting at which a child's 
need for transition services will be considered?

          IV. Other Questions Regarding Implementation of Idea

    14. For a child with a disability receiving special education for 
the first time, when must an IEP be developed--before placement or after 
placement?
    15. Who is responsible for ensuring the development of IEPs for 
children with disabilities served by a public agency other than an LEA?
    16. For a child placed out of State by an educational or non-
educational State or local agency, is the placing or receiving State 
responsible for the child's IEP?
    17. If a disabled child has been receiving special education from 
one public agency and transfers to another public agency in the same 
State, must the new public agency develop an IEP before the child can be 
placed in a special education program?
    18. What timelines apply to the development and implementation of an 
initial IEP for a child with a disability?
    19. Must a public agency hold separate meetings to determine a 
child's eligibility for special education and related services, develop 
the child's IEP, and determine the child's placement, or may the agency 
meet all of these requirements in a single meeting?
    20. How frequently must a public agency conduct meetings to review, 
and if appropriate revise, the IEP for each child with a disability?
    21. May IEP meetings be audio or video-tape-recorded?
    22. Who can serve as the representative of the public agency at an 
IEP meeting?
    23. For a child with a disability being considered for initial 
placement in special education, which teacher or teachers should attend 
the IEP meeting?
    24. What is the role of a regular education teacher in the 
development, review, and revision of the IEP for a child who is, or may 
be, participating in the regular education environment?
    25. If a child with a disability attends several regular classes, 
must all of the child's regular education teachers be members of the 
child's IEP team?
    26. How should a public agency determine which regular education 
teacher and special education teacher will members of the IEP team for a 
particular child with a disability?
    27. For a child whose primary disability is a speech impairment, may 
a public agency meet its responsibility under Sec. 300.344(a)(3) to 
ensure that the IEP team includes ``at least one special education 
teacher, or, if appropriate, at least one special education provider of 
the child'' by including a speech-language pathologist on the IEP team?
    28. Do public agencies and parents have the option of having any 
individual of their choice attend a child's IEP meeting as participants 
on their child's IEP team?
    29. Can parents or public agencies bring their attorneys to IEP 
meetings, and, if so under what circumstances? Are attorney's fees 
available for parents' attorneys if the parents are prevailing parties 
in actions or proceedings brought under Part B?
    30. Must related services personnel attend IEP meetings?
    31. Must the public agency ensure that all services specified in a 
child's IEP are provided?
    32. Is it permissible for an agency to have the IEP completed before 
the IEP meeting begins?
    33. Must a public agency include transportation in a child's IEP as 
a related service?
    34. Must a public agency provide related services that are required 
to assist a child with a disability to benefit from special education, 
whether or not those services are included in the list of related 
services in Sec. 300.24?
    35. Must the IEP specify the amount of services or may it simply 
list the services to be provided?
    36. Under what circumstances is a public agency required to permit a 
child with a disability to use a school-purchased assistive technology 
device in the child's home or in another setting?
    37. Can the IEP team also function as the group making the placement 
decision for a child with a disability?
    38. If a child's IEP includes behavioral strategies to address a 
particular behavior, can a child ever be suspended for engaging in that 
behavior?

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    39. If a child's behavior in the regular classroom, even with 
appropriate interventions, would significantly impair the learning of 
others, can the group that makes the placement decision determine that 
placement in the regular classroom is inappropriate for that child?
    40. May school personnel during a school year implement more than 
one short-term removal of a child with disabilities from his or her 
classroom or school for misconduct?

(Authority: Part B of the Individuals with Disabilities Education Act 
(20 U.S.C. 1401, et seq.), unless otherwise noted.)

      Individualized Education Programs (IEPS) and Other Selected 
                          ImplementatioN Issues

    Interpretation of IEP and Other selected Requirements under Part B 
of the Individuals with Disabilities Education Act (IDEA; Part B)

                              Introduction

    The IEP requirements under Part B of the IDEA emphasize the 
importance of three core concepts: (1) the involvement and progress of 
each child with a disability in the general curriculum including 
addressing the unique needs that arise out of the child's disability; 
(2) the involvement of parents and students, together with regular and 
special education personnel, in making individual decisions to support 
each student's (child's) educational success, and (3) the preparation of 
students with disabilities for employment and other post-school 
activities.
    The first three sections of this Appendix (I-III) provide guidance 
regarding the IEP requirements as they relate to the three core concepts 
described above. Section IV addresses other questions regarding the 
development and content of IEPs, including questions about the timelines 
and responsibility for developing and implementing IEPs, participation 
in IEP meetings, and IEP content. Section IV also addresses questions on 
other selected requirements under IDEA.

   I. Involvement and Progress of Each Child With a Disability in the 
                           General Curriculum

    In enacting the IDEA Amendments of 1997, the Congress found that 
research, demonstration, and practice over the past 20 years in special 
education and related disciplines have demonstrated that an effective 
educational system now and in the future must maintain high academic 
standards and clear performance goals for children with disabilities, 
consistent with the standards and expectations for all students in the 
educational system, and provide for appropriate and effective strategies 
and methods to ensure that students who are children with disabilities 
have maximum opportunities to achieve those standards and goals. 
[Section 651(a)(6)(A) of the Act.]
    Accordingly, the evaluation and IEP provisions of Part B place great 
emphasis on the involvement and progress of children with disabilities 
in the general curriculum. (The term ``general curriculum,'' as used in 
these regulations, including this Appendix, refers to the curriculum 
that is used with nondisabled children.)
    While the Act and regulations recognize that IEP teams must make 
individualized decisions about the special education and related 
services, and supplementary aids and services, provided to each child 
with a disability, they are driven by IDEA's strong preference that, to 
the maximum extent appropriate, children with disabilities be educated 
in regular classes with their nondisabled peers with appropriate 
supplementary aids and services.
    In many cases, children with disabilities will need appropriate 
supports in order to successfully progress in the general curriculum, 
participate in State and district-wide assessment programs, achieve the 
measurable goals in their IEPs, and be educated together with their 
nondisabled peers. Accordingly, the Act requires the IEP team to 
determine, and the public agency to provide, the accommodations, 
modifications, supports, and supplementary aids and services, needed by 
each child with a disability to successfully be involved in and progress 
in the general curriculum achieve the goals of the IEP, and successfully 
demonstrate his or her competencies in State and district-wide 
assessments.
    1. What are the major Part B IEP requirements that govern the 
involvement and progress of children with disabilities in the general 
curriculum?

                Present Levels of Educational Performance

    Section 300.347(a)(1) requires that the IEP for each child with a 
disability include ``* * * a statement of the child's present levels of 
educational performance, including--(i) how the child's disability 
affects the child's involvement and progress in the general curriculum; 
or (ii) for preschool children, as appropriate, how the child's 
disability affects the child's participation in appropriate activities * 
* *'' (``Appropriate activities'' in this context refers to age-relevant 
developmental abilities or milestones that typically developing children 
of the same age would be performing or would have achieved.)
    The IEP team's determination of how each child's disability affects 
the child's involvement and progress in the general curriculum is a 
primary consideration in the development of the child's IEP. In 
assessing children with disabilities, school districts may use a variety 
of assessment techniques to determine the extent to which these children 
can

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be involved and progress in the general curriculum, such as criterion-
referenced tests, standard achievement tests, diagnostic tests, other 
tests, or any combination of the above.
    The purpose of using these assessments is to determine the child's 
present levels of educational performance and areas of need arising from 
the child's disability so that approaches for ensuring the child's 
involvement and progress in the general curriculum and any needed 
adaptations or modifications to that curriculum can be identified.
    Measurable Annual Goals, including Benchmarks or Short-term 
ojectives
    Measurable annual goals, including benchmarks or short-term 
objectives, are critical to the strategic planning process used to 
develop and implement the IEP for each child with a disability. Once the 
IEP team has developed measurable annual goals for a child, the team (1) 
can develop strategies that will be most effective in realizing those 
goals and (2) must develop either measurable, intermediate steps (short-
term objectives) or major milestones (benchmarks) that will enable 
parents, students, and educators to monitor progress during the year, 
and, if appropriate, to revise the IEP consistent with the student's 
instructional needs.
    The strong emphasis in Part B on linking the educational program of 
children with disabilities to the general curriculum is reflected in 
Sec. 300.347(a)(2), which requires that the IEP include:

    A statement of measurable annual goals, including benchmarks or 
short-term objectives, related to--(i) meeting the child's needs that 
result from the child's disability to enable the child to be involved in 
and progress in the general curriculum; and (ii) meeting each of the 
child's other educational needs that result from the child's disability.
    As noted above, each annual goal must include either short-term 
objectives or benchmarks. The purpose of both is to enable a child's 
teacher(s), parents, and others involved in developing and implementing 
the child's IEP, to gauge, at intermediate times during the year, how 
well the child is progressing toward achievement of the annual goal. IEP 
teams may continue to develop short-term instructional objectives, that 
generally break the skills described in the annual goal down into 
discrete components. The revised statute and regulations also provide 
that, as an alternative, IEP teams may develop benchmarks, which can be 
thought of as describing the amount of progress the child is expected to 
make within specified segments of the year. Generally, benchmarks 
establish expected performance levels that allow for regular checks of 
progress that coincide with the reporting periods for informing parents 
of their child's progress toward achieving the annual goals. An IEP team 
may use either short term objectives or benchmarks or a combination of 
the two depending on the nature of the annual goals and the needs of the 
child.

   Special Education and Related Services and Supplementary Aids and 
                                Services

    The requirements regarding services provided to address a child's 
present levels of educational performance and to make progress toward 
the identified goals reinforce the emphasis on progress in the general 
curriculum, as well as maximizing the extent to which children with 
disabilities are educated with nondisabled children. Section 
300.347(a)(3) requires that the IEP include:

    A statement of the special education and related services and 
supplementary aids and services to be provided to the child, or on 
behalf of the child, and a statement of the program modifications or 
supports for school personnel that will be provided for the child--(i) 
to advance appropriately toward attaining the annual goals; (ii) to be 
involved and progress in the general curriculum * * * and to participate 
in extracurricular and other nonacademic activities; and (iii) to be 
educated and participate with other children with disabilities and 
nondisabled children in [extracurricular and other nonacademic 
activities] * * * [Italics added.]

    Extent to Which Child Will Participate With Nondisabled Children

    Section 300.347(a)(4) requires that each child's IEP include ``An 
explanation of the extent, if any, to which the child will not 
participate with nondisabled children in the regular class and in 
[extracurricular and other nonacademic] activities * * *'' This is 
consistent with the least restrictive environment (LRE) provisions at 
Sec. Sec. 300.550-300.553, which include requirements that:
    (1) each child with a disability be educated with nondisabled 
children to the maximum extent appropriate (Sec. 300.550(b)(1));
    (2) each child with a disability be removed from the regular 
educational environment only when the nature or severity of the child's 
disability is such that education in regular classes with the use of 
supplementary aids and services cannot be achieved satisfactorily (Sec. 
300.550(b)(1)); and
    (3) to the maximum extent appropriate to the child's needs, each 
child with a disability participates with nondisabled children in 
nonacademic and extracurricular services and activities (Sec. 300.553).
    All services and educational placements under Part B must be 
individually determined in light of each child's unique abilities and 
needs, to reasonably promote the child's educational success. Placing 
children with disabilities in this manner should enable each disabled 
child to meet high expectations in the future.
    Although Part B requires that a child with a disability not be 
removed from the regular

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educational environment if the child's education can be achieved 
satisfactorily in regular classes with the use of supplementary aids and 
services, Part B's LRE principle is intended to ensure that a child with 
a disability is served in a setting where the child can be educated 
successfully. Even though IDEA does not mandate regular class placement 
for every disabled student, IDEA presumes that the first placement 
option considered for each disabled student by the student's placement 
team, which must include the parent, is the school the child would 
attend if not disabled, with appropriate supplementary aids and services 
to facilitate such placement. Thus, before a disabled child can be 
placed outside of the regular educational environment, the full range of 
supplementary aids and services that if provided would facilitate the 
student's placement in the regular classroom setting must be considered. 
Following that consideration, if a determination is made that particular 
disabled student cannot be educated satisfactorily in the regular 
educational environment, even with the provision of appropriate 
supplementary aids and services, that student then could be placed in a 
setting other than the regular classroom. Later, if it becomes apparent 
that the child's IEP can be carried out in a less restrictive setting, 
with the provision of appropriate supplementary aids and services, if 
needed, Part B would require that the child's placement be changed from 
the more restrictive setting to a less restrictive setting. In all 
cases, placement decisions must be individually determined on the basis 
of each child's abilities and needs, and not solely on factors such as 
category of disability, significance of disability, availability of 
special education and related services, configuration of the service 
delivery system, availability of space, or administrative convenience. 
Rather, each student's IEP forms the basis for the placement decision.
    Further, a student need not fail in the regular classroom before 
another placement can be considered. Conversely, IDEA does not require 
that a student demonstrate achievement of a specific performance level 
as a prerequisite for placement into a regular classroom.

     Participation in State or District-Wide Assessments of Student 
                               Achievement

    Consistent with Sec. 300.138(a), which sets forth a presumption 
that children with disabilities will be included in general State and 
district-wide assessment programs, and provided with appropriate 
accommodations if necessary, Sec. 300.347(a)(5) requires that the IEP 
for each student with a disability include: ``(i) a statement of any 
individual modifications in the administration of State or district-wide 
assessments of student achievement that are needed in order for the 
child to participate in the assessment; and (ii) if the IEP team 
determines that the child will not participate in a particular State or 
district-wide assessment of student achievement (or part of an 
assessment of student achievement), a statement of--(A) Why that 
assessment is not appropriate for the child; and (B) How the child will 
be assessed.''

Regular Education Teacher Participation in the Development, Review, and 
                            Revision of IEPs

    Very often, regular education teachers play a central role in the 
education of children with disabilities (H. Rep. No. 105-95, p. 103 
(1997); S. Rep. No. 105-17, p. 23 (1997)) and have important expertise 
regarding the general curriculum and the general education environment. 
Further, with the emphasis on involvement and progress in the general 
curriculum added by the IDEA Amendments of 1997, regular education 
teachers have an increasingly critical role (together with special 
education and related services personnel) in implementing the program of 
FAPE for most children with disabilities, as described in their IEPs.
    Accordingly, the IDEA Amendments of 1997 added a requirement that 
each child's IEP team must include at least one regular education 
teacher of the child, if the child is, or may be, participating in the 
regular education environment (see Sec. 300.344(a)(2)). (See also 
Sec. Sec. 300.346(d) on the role of a regular education teacher in the 
development, review and revision of IEPs.)
    2. Must a child's IEP address his or her involvement in the general 
curriculum, regardless of the nature and severity of the child's 
disability and the setting in which the child is educated?
    Yes. The IEP for each child with a disability (including children 
who are educated in separate classrooms or schools) must address how the 
child will be involved and progress in the general curriculum. However, 
the Part B regulations recognize that some children have other 
educational needs resulting from their disability that also must be met, 
even though those needs are not directly linked to participation in the 
general curriculum.
    Accordingly, Sec. 300.347(a)(1)(2) requires that each child's IEP 
include:
    A statement of measurable annual goals, including benchmarks or 
short-term objectives related to--(i) Meeting the child's needs that 
result from the child's disability to enable the child to be involved in 
and progress in the general curriculum; and (ii) meeting each of the 
child's other educational needs that result from the child's disability. 
[Italics added.]
    Thus, the IEP team for each child with a disability must make an 
individualized determination regarding (1) how the child will

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be involved and progress in the general curriculum and what needs that 
result from the child's disability must be met to facilitate that 
participation; (2) whether the child has any other educational needs 
resulting from his or her disability that also must be met; and (3) what 
special education and other services and supports must be described in 
the child's IEP to address both sets of needs (consistent with Sec. 
300.347(a)). For example, if the IEP team determines that in order for a 
child who is deaf to participate in the general curriculum he or she 
needs sign language and materials which reflect his or her language 
development, those needs (relating to the child's participation in the 
general curriculum) must be addressed in the child's IEP. In addition, 
if the team determines that the child also needs to expand his or her 
vocabulary in sign language that service must also be addressed in the 
applicable components of the child's IEP. The IEP team may also wish to 
consider whether there is a need for members of the child's family to 
receive training in sign language in order for the child to receive 
FAPE.
    3. What must public agencies do to meet the requirements at 
Sec. Sec. 300.344(a)(2) and 300.346(d) regarding the participation of a 
``regular education teacher'' in the development, review, and revision 
of IEPs, for children aged 3 through 5 who are receiving preschool 
special education services?
    If a public agency provides ``regular education'' preschool services 
to non-disabled children, then the requirements of Sec. Sec. 
300.344(a)(2) and 300.346(d) apply as they do in the case of older 
children with disabilities. If a public agency makes kindergarten 
available to nondisabled children, then a regular education kindergarten 
teacher could appropriately be the regular education teacher who would 
be a member of the IEP team, and, as appropriate, participate in IEP 
meetings, for a kindergarten-aged child who is, or may be, participating 
in the regular education environment.
    If a public agency does not provide regular preschool education 
services to nondisabled children, the agency could designate an 
individual who, under State standards, is qualified to serve nondisabled 
children of the same age.
    4. Must the measurable annual goals in a child's IEP address all 
areas of the general curriculum, or only those areas in which the 
child's involvement and progress are affected by the child's disability?
    Section 300.347(a)(2) requires that each child's IEP include ``A 
statement of measurable annual goals, including benchmarks or short-term 
objectives, related to--(i) meeting the child's needs that result from 
the child's disability to enable the child to be involved in and 
progress in the general curriculum * * *; and (ii) meeting each of the 
child's other educational needs that result from the child's disability. 
. . .'' (Italics added).
    Thus, a public agency is not required to include in an IEP annual 
goals that relate to areas of the general curriculum in which the 
child's disability does not affect the child's ability to be involved in 
and progress in the general curriculum. If a child with a disability 
needs only modifications or accommodations in order to progress in an 
area of the general curriculum, the IEP does not need to include a goal 
for that area; however, the IEP would need to specify those 
modifications or accommodations.
    Public agencies often require all children, including children with 
disabilities, to demonstrate mastery in a given area of the general 
curriculum before allowing them to progress to the next level or grade 
in that area. Thus, in order to ensure that each child with a disability 
can effectively demonstrate competencies in an applicable area of the 
general curriculum, it is important for the IEP team to consider the 
accommodations and modifications that the child needs to assist him or 
her in demonstrating progress in that area.

                 II. Involvement of Parents and Students

    The Congressional Committee Reports on the IDEA Amendments of 1997 
express the view that the Amendments provide an opportunity for 
strengthening the role of parents, and emphasize that one of the 
purposes of the Amendments is to expand opportunities for parents and 
key public agency staff (e.g., special education, related services, 
regular education, and early intervention service providers, and other 
personnel) to work in new partnerships at both the State and local 
levels (H. Rep. 105-95, p. 82 (1997); S. Rep. No. 105-17, p. 4 and 5 
(1997)). Accordingly, the IDEA Amendments of 1997 require that parents 
have an opportunity to participate in meetings with respect to the 
identification, evaluation, and educational placement of the child, and 
the provision of FAPE to the child. (Sec. 300.501(a)(2)). Thus, parents 
must now be part of: (1) the group that determines what additional data 
are needed as part of an evaluation of their child (Sec. 
300.533(a)(1)); (2) the team that determines their child's eligibility 
(Sec. 300.534(a)(1)); and (3) the group that makes decisions on the 
educational placement of their child (Sec. 300.501(c)).
    In addition, the concerns of parents and the information that they 
provide regarding their children must be considered in developing and 
reviewing their children's IEPs (Sec. Sec. 300.343(c)(iii) and 
300.346(a)(1)(i) and (b)); and the requirements for keeping parents 
informed about the educational progress of their children, particularly 
as it relates to their progress in the general curriculum, have been 
strengthened (Sec. 300.347(a)(7)).

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    The IDEA Amendments of 1997 also contain provisions that greatly 
strengthen the involvement of students with disabilities in decisions 
regarding their own futures, to facilitate movement from school to post-
school activities. For example, those amendments (1) retained, 
essentially verbatim, the ``transition services'' requirements from the 
IDEA Amendments of 1990 (which provide that a statement of needed 
transition services must be in the IEP of each student with a 
disability, beginning no later than age 16); and (2) significantly 
expanded those provisions by adding a new annual requirement for the IEP 
to include ``transition planning'' activities for students beginning at 
age 14. (See section IV of this appendix for a description of the 
transition services requirements and definition.)
    With respect to student involvement in decisions regarding 
transition services, Sec. 300.344(b) provides that (1) ``the public 
agency shall invite a student with a disability of any age to attend his 
or her IEP meeting if a purpose of the meeting will be the consideration 
of--(i) The student's transition services needs under Sec. 
300.347(b)(1); or (ii) The needed transition services for the student 
under Sec. 300.347(b)(2); or (iii) Both;'' and (2) ``If the student 
does not attend the IEP meeting, the public agency shall take other 
steps to ensure that the student's preferences and interests are 
considered.'' (Sec. 300.344(b)(2)).
    The IDEA Amendments of 1997 also give States the authority to elect 
to transfer the rights accorded to parents under Part B to each student 
with a disability upon reaching the age of majority under State law (if 
the student has not been determined incompetent under State law) (Sec. 
300.517). (Part B requires that if the rights transfer to the student, 
the public agency must provide any notice required under Part B to both 
the student and the parents.) If the State elects to provide for the 
transfer of rights from the parents to the student at the age of 
majority, the IEP must, beginning at least one year before a student 
reaches the age of majority under State law, include a statement that 
the student has been informed of any rights that will transfer to him or 
her upon reaching the age of majority. (Sec. 300.347(c)).
    The IDEA Amendments of 1997 also permit, but do not require, States 
to establish a procedure for appointing the parent, or another 
appropriate individual if the parent is not available, to represent the 
educational interests of a student with a disability who has reached the 
age of majority under State law and has not been determined to be 
incompetent, but who is determined not to have the ability to provide 
informed consent with respect to his or her educational program.
    5. What is the role of the parents, including surrogate parents, in 
decisions regarding the educational program of their children?
    The parents of a child with a disability are expected to be equal 
participants along with school personnel, in developing, reviewing, and 
revising the IEP for their child. This is an active role in which the 
parents (1) provide critical information regarding the strengths of 
their child and express their concerns for enhancing the education of 
their child; (2) participate in discussions about the child's need for 
special education and related services and supplementary aids and 
services; and (3) join with the other participants in deciding how the 
child will be involved and progress in the general curriculum and 
participate in State and district-wide assessments, and what services 
the agency will provide to the child and in what setting.
    As previously noted in the introduction to section II of this 
Appendix, Part B specifically provides that parents of children with 
disabilities--
     Have an opportunity to participate in meetings 
with respect to the identification, evaluation, and educational 
placement of their child, and the provision of FAPE to the child 
(including IEP meetings) (Sec. Sec. 300.501(b), 300.344(a)(1), and 
300.517;
     Be part of the groups that determine what 
additional data are needed as part of an evaluation of their child 
(Sec. 300.533(a)(1)), and determine their child's eligibility (Sec. 
300.534(a)(1)) and educational placement (Sec. 300.501(c));
     Have their concerns and the information that they 
provide regarding their child considered in developing and reviewing 
their child's IEPs (Sec. Sec. 300.343(c)(iii) and 300.346(a)(1)(i) and 
(b)); and
     Be regularly informed (by such means as periodic 
report cards), as specified in their child's IEP, at least as often as 
parents are informed of their nondisabled children's progress, of their 
child's progress toward the annual goals in the IEP and the extent to 
which that progress is sufficient to enable the child to achieve the 
goals by the end of the year (Sec. 300.347(a)(7)).
    A surrogate parent is a person appointed to represent the interests 
of a child with a disability in the educational decision-making process 
when no parent (as defined at Sec. 300.20) is known, the agency, after 
reasonable efforts, cannot locate the child's parents, or the child is a 
ward of the State under the laws of the State. A surrogate parent has 
all of the rights and responsibilities of a parent under Part B (Sec. 
300.515.)
    6. What are the Part B requirements regarding the participation of a 
student (child) with a disability in an IEP meeting?
    If a purpose of an IEP meeting for a student with a disability will 
be the consideration of the student's transition services needs or 
needed transition services under Sec. 300.347(b)(1) or (2), or both, 
the public agency must invite the student and, as part of

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the notification to the parents of the IEP meeting, inform the parents 
that the agency will invite the student to the IEP meeting.
    If the student does not attend, the public agency must take other 
steps to ensure that the student's preferences and interests are 
considered. (See Sec. 300.344(b)).
    Section Sec. 300.517 permits, but does not require, States to 
transfer procedural rights under Part B from the parents to students 
with disabilities who reach the age of majority under State law, if they 
have not been determined to be incompetent under State law. If those 
rights are to be transferred from the parents to the student, the public 
agency would be required to ensure that the student has the right to 
participate in IEP meetings set forth for parents in Sec. 300.345. 
However, at the discretion of the student or the public agency, the 
parents also could attend IEP meetings as ``* * * individuals who have 
knowledge or special expertise regarding the child * * *'' (see Sec. 
300.344(a)(6)).
    In other circumstances, a child with a disability may attend ``if 
appropriate.'' (Sec. 300.344(a)(7)). Generally, a child with a 
disability should attend the IEP meeting if the parent decides that it 
is appropriate for the child to do so. If possible, the agency and 
parents should discuss the appropriateness of the child's participation 
before a decision is made, in order to help the parents determine 
whether or not the child's attendance would be (1) helpful in developing 
the IEP or (2) directly beneficial to the child or both. The agency 
should inform the parents before each IEP meeting--as part of 
notification under Sec. 300.345(a)(1)--that they may invite their child 
to participate.
    7. Must the public agency inform the parents of who will be at the 
IEP meeting?
    Yes. In notifying parents about the meeting, the agency ``must 
indicate the purpose, time, and location of the meeting, and who will be 
in attendance.'' (Sec. 300.345(b), italics added.) In addition, if a 
purpose of the IEP meeting will be the consideration of a student's 
transition services needs or needed transition services under Sec. 
300.347(b)(1) or (2) or both, the notice must also inform the parents 
that the agency is inviting the student, and identify any other agency 
that will be invited to send a representative.
    The public agency also must inform the parents of the right of the 
parents and the agency to invite other individuals who have knowledge or 
special expertise regarding the child, including related services 
personnel as appropriate to be members of the IEP team. (Sec. 
300.345(b)(1)(ii).)
    It also may be appropriate for the agency to ask the parents to 
inform the agency of any individuals the parents will be bringing to the 
meeting. Parents are encouraged to let the agency know whom they intend 
to bring. Such cooperation can facilitate arrangements for the meeting, 
and help ensure a productive, child-centered meeting.
    8. Do parents have the right to a copy of their child's IEP?
    Yes. Section 300.345(f) states that the public agency shall give the 
parent a copy of the IEP at no cost to the parent.
    9. What is a public agency's responsibility if it is not possible to 
reach consensus on what services should be included in a child's IEP?
    The IEP meeting serves as a communication vehicle between parents 
and school personnel, and enables them, as equal participants, to make 
joint, informed decisions regarding the (1) child's needs and 
appropriate goals; (2) extent to which the child will be involved in the 
general curriculum and participate in the regular education environment 
and State and district-wide assessments; and (3) services needed to 
support that involvement and participation and to achieve agreed-upon 
goals. Parents are considered equal partners with school personnel in 
making these decisions, and the IEP team must consider the parents' 
concerns and the information that they provide regarding their child in 
developing, reviewing, and revising IEPs (Sec. Sec. 300.343(c)(iii) and 
300.346(a)(1) and (b)).
    The IEP team should work toward consensus, but the public agency has 
ultimate responsibility to ensure that the IEP includes the services 
that the child needs in order to receive FAPE. It is not appropriate to 
make IEP decisions based upon a majority ``vote.'' If the team cannot 
reach consensus, the public agency must provide the parents with prior 
written notice of the agency's proposals or refusals, or both, regarding 
the child's educational program, and the parents have the right to seek 
resolution of any disagreements by initiating an impartial due process 
hearing.
    Every effort should be made to resolve differences between parents 
and school staff through voluntary mediation or some other informal 
step, without resort to a due process hearing. However, mediation or 
other informal procedures may not be used to deny or delay a parent's 
right to a due process hearing, or to deny any other rights afforded 
under Part B.
    10. Does Part B require that public agencies inform parents 
regarding the educational progress of their children with disabilities?
    Yes. The Part B statute and regulations include a number of 
provisions to help ensure that parents are involved in decisions 
regarding, and are informed about, their child's educational progress, 
including the child's progress in the general curriculum. First, the 
parents will be informed regarding their child's present levels of 
educational performance through the development of the

[[Page 106]]

IEP. Section 300.347(a)(1) requires that each IEP include:
    * * * A statement of the child's present levels of educational 
performance, including--(i) how the child's disability affects the 
child's involvement and progress in the general curriculum; or (ii) for 
preschool children, as appropriate, how the disability affects the 
child's participation in appropriate activities * * *
    Further, Sec. 300.347(a)(7) sets forth new requirements for 
regularly informing parents about their child's educational progress, as 
regularly as parents of nondisabled children are informed of their 
child's progress. That section requires that the IEP include:
    A statement of--(i) How the child's progress toward the annual goals 
* * * will be measured; and (ii) how the child's parents will be 
regularly informed (by such means as periodic report cards), at least as 
often as parents are informed of their nondisabled children's progress, 
of--(A) their child's progress toward the annual goals; and (B) the 
extent to which that progress is sufficient to enable the child to 
achieve the goals by the end of the year.
    One method that public agencies could use in meeting this 
requirement would be to provide periodic report cards to the parents of 
students with disabilities that include both (1) the grading information 
provided for all children in the agency at the same intervals; and (2) 
the specific information required by Sec. 300.347(a)(7)(ii)(A) and (B).
    Finally, the parents, as part of the IEP team, will participate at 
least once every 12 months in a review of their child's educational 
progress. Section 300.343(c) requires that a public agency initiate and 
conduct a meeting, at which the IEP team:
    * * * (1) Reviews the child's IEP periodically, but not less than 
annually to determine whether the annual goals for the child are being 
achieved; and (2) revises the IEP as appropriate to address--(i) any 
lack of expected progress toward the annual goals * * * and in the 
general curriculum, if appropriate; (ii) The results of any reevaluation 
* * *; (iii) Information about the child provided to, or by, the parents 
* * *; (iv) The child's anticipated needs; or (v) Other matters.

III. Preparing Students With Disabilities for Employment and Other Post-
                           School Experiences

    One of the primary purposes of the IDEA is to ``* * * ensure that 
all children with disabilities have available to them a free appropriate 
public education that emphasizes special education and related services 
designed to meet their unique needs and prepare them for employment and 
independent living * * *'' (Sec. 300.1(a)). Section 701 of the 
Rehabilitation Act of 1973 describes the philosophy of independent 
living as including a philosophy of consumer control, peer support, 
self-help, self-determination, equal access, and individual and system 
advocacy, in order to maximize the leadership, empowerment, 
independence, and productivity of individuals with disabilities, and the 
integration and full inclusion of individuals with disabilities into the 
mainstream of American society. Because many students receiving services 
under IDEA will also receive services under the Rehabilitation Act, it 
is important, in planning for their future, to consider the impact of 
both statutes.
    Similarly, one of the key purposes of the IDEA Amendments of 1997 
was to ``promote improved educational results for children with 
disabilities through early intervention, preschool, and educational 
experiences that prepare them for later educational challenges and 
employment.'' (H. Rep. No. 105-95, p. 82 (1997); S. Rep. No. 105-17, p. 
4 (1997)).
    Thus, throughout their preschool, elementary, and secondary 
education, the IEPs for children with disabilities must, to the extent 
appropriate for each individual child, focus on providing instruction 
and experiences that enable the child to prepare himself or herself for 
later educational experiences and for post-school activities, including 
formal education, if appropriate, employment, and independent living. 
Many students with disabilities will obtain services through State 
vocational rehabilitation programs to ensure that their educational 
goals are effectively implemented in post-school activities. Services 
available through rehabilitation programs are consistent with the 
underlying purpose of IDEA.
    Although preparation for adult life is a key component of FAPE 
throughout the educational experiences of students with disabilities, 
Part B sets forth specific requirements related to transition planning 
and transition services that must be implemented no later than ages 14 
and 16, respectively, and which require an intensified focus on that 
preparation as these students begin and prepare to complete their 
secondary education.
    11. What must the IEP team do to meet the requirements that the IEP 
include ``a statement of * * * transition service needs'' beginning at 
age 14 (Sec. 300.347(b)(1)(i)),'' and a statement of needed transition 
services'' no later than age 16 (Sec. 300.347(b)(2)?
    Section 300.347(b)(1) requires that, beginning no later than age 14, 
each student's IEP include specific transition-related content, and, 
beginning no later than age 16, a statement of needed transition 
services:
    Beginning at age 14 and younger if appropriate, and updated 
annually, each student's IEP must include:

    ``* * * a statement of the transition service needs of the student 
under the applicable components of the student's IEP that focuses on the 
student's courses of study (such as participation in advanced-placement 
courses

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or a vocational education program)'' (Sec. 300.347(b)(1)(i)).
    Beginning at age 16 (or younger, if determined appropriate by the 
IEP team), each student's IEP must include:

    ``* * * a statement of needed transition services for the student, 
including, if appropriate, a statement of the interagency 
responsibilities or any needed linkages.'' (Sec. 300.347(b)(2)).
    The Committee Reports on the IDEA Amendments of 1997 make clear that 
the requirement added to the statute in 1997 that beginning at age 14, 
and updated annually, the IEP include ``a statement of the transition 
service needs'' is ``* * * designed to augment, and not replace,'' the 
separate, preexisting requirement that the IEP include, ``* * * 
beginning at age 16 (or younger, if determined appropriate by the IEP 
team), a statement of needed transition services * * *'' (H. Rep. No. 
105-95, p. 102 (1997); S. Rep. No. 105-17, p. 22 (1997)). As clarified 
by the Reports, ``The purpose of [the requirement in Sec. 
300.347(b)(1)(i)] is to focus attention on how the child's educational 
program can be planned to help the child make a successful transition to 
his or her goals for life after secondary school.'' (H. Rep. No. 105-95, 
pp. 101-102 (1997); S. Rep. No. 105-17, p. 22 (1997)). The Reports 
further explain that ``[F]or example, for a child whose transition goal 
is a job, a transition service could be teaching the child how to get to 
the job site on public transportation.'' (H. Rep. No. 105-95, p. 102 
(1997); S. Rep. No. 105-17, p. 22 (1997)).
    Thus, beginning at age 14, the IEP team, in determining appropriate 
measurable annual goals (including benchmarks or short-term objectives) 
and services for a student, must determine what instruction and 
educational experiences will assist the student to prepare for 
transition from secondary education to post-secondary life.
    The statement of transition service needs should relate directly to 
the student's goals beyond secondary education, and show how planned 
studies are linked to these goals. For example, a student interested in 
exploring a career in computer science may have a statement of 
transition services needs connected to technology course work, while 
another student's statement of transition services needs could describe 
why public bus transportation training is important for future 
independence in the community.
    Although the focus of the transition planning process may shift as 
the student approaches graduation, the IEP team must discuss specific 
areas beginning at least at the age of 14 years and review these areas 
annually. As noted in the Committee Reports, a disproportionate number 
of students with disabilities drop out of school before they complete 
their secondary education: ``Too many students with disabilities are 
failing courses and dropping out of school. Almost twice as many 
students with disabilities drop out as compared to students without 
disabilities.'' (H. Rep. No. 105-95, p. 85 (1997), S. Rep. No. 105-17, 
p. 5 (1997).)
    To help reduce the number of students with disabilities that drop 
out, it is important that the IEP team work with each student with a 
disability and the student's family to select courses of study that will 
be meaningful to the student's future and motivate the student to 
complete his or her education.
    This requirement is distinct from the requirement, at Sec. 
300.347(b)(2), that the IEP include:

    * * * beginning at age 16 (or younger, if determined appropriate by 
the IEP team), a statement of needed transition services for the child, 
including, if appropriate, a statement of the interagency 
responsibilities or any needed linkages.
    The term ``transition services'' is defined at Sec. 300.29 to mean:

    * * * a coordinated set of activities for a student with a 
disability that--(1) Is designed within an outcome-oriented process, 
that promotes movement from school to post-school activities, including 
postsecondary education, vocational training, integrated employment 
(including supported employment), continuing and adult education, adult 
services, independent living, or community participation; (2) Is based 
on the individual student's needs, taking into account the student's 
preferences and interests; and (3) Includes--(i) Instruction; (ii) 
Related services; (iii) Community experiences; (iv) The development of 
employment and other post-school adult living objectives; and (v) If 
appropriate, acquisition of daily living skills and functional 
vocational evaluation.
    Thus, while Sec. 300.347(b)(1) requires that the IEP team begin by 
age 14 to address the student's need for instruction that will assist 
the student to prepare for transition, the IEP must include by age 16 a 
statement of needed transition services under Sec. 300.347(b)(2) that 
includes a ``coordinated set of activities * * *, designed within an 
outcome-oriented process, that promotes movement from school to post-
school activities * * *.'' (Sec. 300.29) Section 300.344(b)(3) further 
requires that, in implementing Sec. 300.347(b)(1), public agencies (in 
addition to required participants for all IEP meetings), must also 
invite a representative of any other agency that is likely to be 
responsible for providing or paying for transition services. Thus, Sec. 
300.347(b)(2) requires a broader focus on coordination of services 
across, and linkages between, agencies beyond the SEA and LEA.
    12. Must the IEP for each student with a disability, beginning no 
later than age 16, include all ``needed transition services,'' as 
identified by the IEP team and consistent with the definition at Sec. 
300.29, even if an

[[Page 108]]

agency other than the public agency will provide those services? What is 
the public agency's responsibility if another agency fails to provide 
agreed-upon transition services?
    Section 300.347(b)(2) requires that the IEP for each child with a 
disability, beginning no later than age 16, or younger if determined 
appropriate by the IEP team, include all ``needed transition services,'' 
as identified by the IEP team and consistent with the definition at 
Sec. 300.29, regardless of whether the public agency or some other 
agency will provide those services. Section 300.347(b)(2) specifically 
requires that the statement of needed transition services include, ``* * 
* if appropriate, a statement of the interagency responsibilities or any 
needed linkages.''
    Further, the IDEA Amendments of 1997 also permit an LEA to use up to 
five percent of the Part B funds it receives in any fiscal year in 
combination with other amounts, which must include amounts other than 
education funds, to develop and implement a coordinated services system. 
These funds may be used for activities such as: (1) linking IEPs under 
Part B and Individualized Family Service Plans (IFSPs) under Part C, 
with Individualized Service Plans developed under multiple Federal and 
State programs, such as Title I of the Rehabilitation Act; and (2) 
developing and implementing interagency financing strategies for the 
provision of services, including transition services under Part B.
    The need to include, as part of a student's IEP, transition services 
to be provided by agencies other than the public agency is contemplated 
by Sec. 300.348(a), which specifies what the public agency must do if 
another agency participating in the development of the statement of 
needed transition services fails to provide a needed transition service 
that it had agreed to provide.
    If an agreed-upon service by another agency is not provided, the 
public agency responsible for the student's education must implement 
alternative strategies to meet the student's needs. This requires that 
the public agency provide the services, or convene an IEP meeting as 
soon as possible to identify alternative strategies to meet the 
transition services objectives, and to revise the IEP accordingly.
    Alternative strategies might include the identification of another 
funding source, referral to another agency, the public agency's 
identification of other district-wide or community resources that it can 
use to meet the student's identified needs appropriately, or a 
combination of these strategies. As emphasized by Sec. 300.348(b), 
however:
    Nothing in [Part B] relieves any participating agency, including a 
State vocational rehabilitation agency, of the responsibility to provide 
or pay for any transition service that the agency would otherwise 
provide to students with disabilities who meet the eligibility criteria 
of that agency.
    However, the fact that an agency other than the public agency does 
not fulfill its responsibility does not relieve the public agency of its 
responsibility to ensure that FAPE is available to each student with a 
disability. (Section 300.142(b)(2) specifically requires that if an 
agency other than the LEA fails to provide or pay for a special 
education or related service (which could include a transition service), 
the LEA must, without delay, provide or pay for the service, and may 
then claim reimbursement from the agency that failed to provide or pay 
for the service.)
    13. Under what circumstances must a public agency invite 
representatives from other agencies to an IEP meeting at which a child's 
need for transition services will be considered?
    Section 300.344 requires that, ``In implementing the requirements of 
[Sec. 300.347(b)(1)(ii) requiring a statement of needed transition 
services], the public agency shall also invite a representative of any 
other agency that is likely to be responsible for providing or paying 
for transition services.'' To meet this requirement, the public agency 
must identify all agencies that are ``likely to be responsible for 
providing or paying for transition services'' for each student addressed 
by Sec. 300.347(b)(1), and must invite each of those agencies to the 
IEP meeting; and if an agency invited to send a representative to a 
meeting does not do so, the public agency must take other steps to 
obtain the participation of that agency in the planning of any 
transition services.
    If, during the course of an IEP meeting, the team identifies 
additional agencies that are ``likely to be responsible for providing or 
paying for transition services'' for the student, the public agency must 
determine how it will meet the requirements of Sec. 300.344.

    IV. Other Questions Regarding the Development and Content of IEPS

    14. For a child with a disability receiving special education for 
the first time, when must an IEP be developed--before or after the child 
begins to receive special education and related services?
    Section 300.342(b)(1) requires that an IEP be ``in effect before 
special education and related services are provided to an eligible child 
* * *'' (Italics added.)
    The appropriate placement for a particular child with a disability 
cannot be determined until after decisions have been made about the 
child's needs and the services that the public agency will provide to 
meet those needs. These decisions must be made at the IEP meeting, and 
it would not be permissible first to place the child and then develop 
the IEP. Therefore, the IEP must be developed

[[Page 109]]

before placement. (Further, the child's placement must be based, among 
other factors, on the child's IEP.)
    This requirement does not preclude temporarily placing an eligible 
child with a disability in a program as part of the evaluation process--
before the IEP is finalized--to assist a public agency in determining 
the appropriate placement for the child. However, it is essential that 
the temporary placement not become the final placement before the IEP is 
finalized. In order to ensure that this does not happen, the State might 
consider requiring LEAs to take the following actions:
    a. Develop an interim IEP for the child that sets out the specific 
conditions and timelines for the trial placement. (See paragraph c, 
following.)
    b. Ensure that the parents agree to the interim placement before it 
is carried out, and that they are involved throughout the process of 
developing, reviewing, and revising the child's IEP.
    c. Set a specific timeline (e.g., 30 days) for completing the 
evaluation, finalizing the IEP, and determining the appropriate 
placement for the child.
    d. Conduct an IEP meeting at the end of the trial period in order to 
finalize the child's IEP.
    15. Who is responsible for ensuring the development of IEPs for 
children with disabilities served by a public agency other than an LEA?
    The answer as to which public agency has direct responsibility for 
ensuring the development of IEPs for children with disabilities served 
by a public agency other than an LEA will vary from State to State, 
depending upon State law, policy, or practice. The SEA is ultimately 
responsible for ensuring that all Part B requirements, including the IEP 
requirements, are met for eligible children within the State, including 
those children served by a public agency other than an LEA. Thus, the 
SEA must ensure that every eligible child with a disability in the State 
has FAPE available, regardless of which State or local agency is 
responsible for educating the child. (The only exception to this 
responsibility is that the SEA is not responsible for ensuring that FAPE 
is made available to children with disabilities who are convicted as 
adults under State law and incarcerated in adult prisons, if the State 
has assigned that responsibility to a public agency other than the SEA. 
(See Sec. 300.600(d)).
    Although the SEA has flexibility in deciding the best means to meet 
this obligation (e.g., through interagency agreements), the SEA must 
ensure that no eligible child with a disability is denied FAPE due to 
jurisdictional disputes among agencies.
    When an LEA is responsible for the education of a child with a 
disability, the LEA remains responsible for developing the child's IEP, 
regardless of the public or private school setting into which it places 
the child.
    16. For a child placed out of State by an educational or non-
educational State or local agency, is the placing or receiving State 
responsible for the child's IEP?
    Regardless of the reason for the placement, the ``placing'' State is 
responsible for ensuring that the child's IEP is developed and that it 
is implemented. The determination of the specific agency in the placing 
State that is responsible for the child's IEP would be based on State 
law, policy, or practice. However, the SEA in the placing State is 
ultimately responsible for ensuring that the child has FAPE available.
    17. If a disabled child has been receiving special education from 
one public agency and transfers to another public agency in the same 
State, must the new public agency develop an IEP before the child can be 
placed in a special education program?
    If a child with a disability moves from one public agency to another 
in the same State, the State and its public agencies have an ongoing 
responsibility to ensure that FAPE is made available to that child. This 
means that if a child moves to another public agency the new agency is 
responsible for ensuring that the child has available special education 
and related services in conformity with an IEP.
    The new public agency must ensure that the child has an IEP in 
effect before the agency can provide special education and related 
services. The new public agency may meet this responsibility by either 
adopting the IEP the former public agency developed for the child or by 
developing a new IEP for the child. (The new public agency is strongly 
encouraged to continue implementing the IEP developed by the former 
public agency, if appropriate, especially if the parents believe their 
child was progressing appropriately under that IEP.)
    Before the child's IEP is finalized, the new public agency may 
provide interim services agreed to by both the parents and the new 
public agency. If the parents and the new public agency are unable to 
agree on an interim IEP and placement, the new public agency must 
implement the old IEP to the extent possible until a new IEP is 
developed and implemented.
    In general, while the new public agency must conduct an IEP meeting, 
it would not be necessary if: (1) A copy of the child's current IEP is 
available; (2) the parents indicate that they are satisfied with the 
current IEP; and (3) the new public agency determines that the current 
IEP is appropriate and can be implemented as written.
    If the child's current IEP is not available, or if either the new 
public agency or the parent believes that it is not appropriate, the new 
public agency must develop a new IEP

[[Page 110]]

through appropriate procedures within a short time after the child 
enrolls in the new public agency (normally, within one week).
    18. What timelines apply to the development and implementation of an 
initial IEP for a child with a disability?
    Section 300.343(b) requires each public agency to ensure that within 
a reasonable period of time following the agency's receipt of parent 
consent to an initial evaluation of a child, the child is evaluated and, 
if determined eligible, special education and related services are made 
available to the child in accordance with an IEP. The section further 
requires the agency to conduct a meeting to develop an IEP for the child 
within 30 days of determining that the child needs special education and 
related services.
    Section 300.342(b)(2) provides that an IEP must be implemented as 
soon as possible following the meeting in which the IEP is developed.
    19. Must a public agency hold separate meetings to determine a 
child's eligibility for special education and related services, develop 
the child's IEP, and determine the child's placement, or may the agency 
meet all of these requirements in a single meeting?
    A public agency may, after a child is determined by ``a group of 
qualified professionals and the parent'' (see Sec. 300.534(a)(1)) to be 
a child with a disability, continue in the same meeting to develop an 
IEP for the child and then to determine the child's placement. However, 
the public agency must ensure that it meets: (1) the requirements of 
Sec. 300.535 regarding eligibility decisions; (2) all of the Part B 
requirements regarding meetings to develop IEPs (including providing 
appropriate notification to the parents, consistent with the 
requirements of Sec. Sec. 300.345, 300.503, and 300.504, and ensuring 
that all the required team members participate in the development of the 
IEP, consistent with the requirements of Sec. 300.344;) and (3) 
ensuring that the placement is made by the required individuals, 
including the parent, as required by Sec. Sec. 300.552 and 300.501(c).
    20. How frequently must a public agency conduct meetings to review, 
and, if appropriate, revise the IEP for each child with a disability?
    A public agency must initiate and conduct meetings periodically, but 
at least once every twelve months, to review each child's IEP, in order 
to determine whether the annual goals for the child are being achieved, 
and to revise the IEP, as appropriate, to address: (a) Any lack of 
expected progress toward the annual goals and in the general curriculum, 
if appropriate; (b) the results of any reevaluation; (c) information 
about the child provided to, or by, the parents; (d) the child's 
anticipated needs; or (e) other matters (Sec. 300.343(c)).
    A public agency also must ensure that an IEP is in effect for each 
child at the beginning of each school year (Sec. 300.342(a)). It may 
conduct IEP meetings at any time during the year. However, if the agency 
conducts the IEP meeting prior to the beginning of the next school year, 
it must ensure that the IEP contains the necessary special education and 
related services and supplementary aids and services to ensure that the 
student's IEP can be appropriately implemented during the next school 
year. Otherwise, it would be necessary for the public agency to conduct 
another IEP meeting.
    Although the public agency is responsible for determining when it is 
necessary to conduct an IEP meeting, the parents of a child with a 
disability have the right to request an IEP meeting at any time. For 
example, if the parents believe that the child is not progressing 
satisfactorily or that there is a problem with the child's current IEP, 
it would be appropriate for the parents to request an IEP meeting.
    If a child's teacher feels that the child's IEP or placement is not 
appropriate for the child, the teacher should follow agency procedures 
with respect to: (1) calling or meeting with the parents or (2) 
requesting the agency to hold another IEP meeting to review the child's 
IEP.
    The legislative history of Public Law 94-142 makes it clear that 
there should be as many meetings a year as any one child may need (121 
Cong. Rec. S20428-29 (Nov. 19, 1975) (remarks of Senator Stafford)). 
Public agencies should grant any reasonable parent request for an IEP 
meeting. For example, if the parents question the adequacy of services 
that are provided while their child is suspended for short periods of 
time, it would be appropriate to convene an IEP meeting.
    In general, if either a parent or a public agency believes that a 
required component of the student's IEP should be changed, the public 
agency must conduct an IEP meeting if it believes that a change in the 
IEP may be necessary to ensure the provision of FAPE.
    If a parent requests an IEP meeting because the parent believes that 
a change is needed in the provision of FAPE to the child or the 
educational placement of the child, and the agency refuses to convene an 
IEP meeting to determine whether such a change is needed, the agency 
must provide written notice to the parents of the refusal, including an 
explanation of why the agency has determined that conducting the meeting 
is not necessary to ensure the provision of FAPE to the student.
    Under Sec. 300.507(a), the parents or agency may initiate a due 
process hearing at any time regarding any proposal or refusal regarding 
the identification, evaluation, or educational placement of the child, 
or the

[[Page 111]]

provision of FAPE to the child, and the public agency must inform 
parents about the availability of mediation.
    21. May IEP meetings be audio- or video-tape-recorded?
    Part B does not address the use of audio or video recording devices 
at IEP meetings, and no other Federal statute either authorizes or 
prohibits the recording of an IEP meeting by either a parent or a school 
official. Therefore, an SEA or public agency has the option to require, 
prohibit, limit, or otherwise regulate the use of recording devices at 
IEP meetings.
    If a public agency has a policy that prohibits or limits the use of 
recording devices at IEP meetings, that policy must provide for 
exceptions if they are necessary to ensure that the parent understands 
the IEP or the IEP process or to implement other parental rights 
guaranteed under Part B. An SEA or school district that adopts a rule 
regulating the tape recording of IEP meetings also should ensure that it 
is uniformly applied.
    Any recording of an IEP meeting that is maintained by the public 
agency is an ``education record,'' within the meaning of the Family 
Educational Rights and Privacy Act (``FERPA''; 20 U.S.C. 1232g), and 
would, therefore, be subject to the confidentiality requirements of the 
regulations under both FERPA (34 CFR part 99) and part B (Sec. Sec. 
300.560-300.575).
    Parents wishing to use audio or video recording devices at IEP 
meetings should consult State or local policies for further guidance.
    22. Who can serve as the representative of the public agency at an 
IEP meeting?
    The IEP team must include a representative of the public agency who: 
(a) Is qualified to provide, or supervise the provision of, specially 
designed instruction to meet the unique needs of children with 
disabilities; (b) is knowledgeable about the general curriculum; and (c) 
is knowledgeable about the availability of resources of the public 
agency (Sec. 300.344(a)(4)).
    Each public agency may determine which specific staff member will 
serve as the agency representative in a particular IEP meeting, so long 
as the individual meets these requirements. It is important, however, 
that the agency representative have the authority to commit agency 
resources and be able to ensure that whatever services are set out in 
the IEP will actually be provided.
    A public agency may designate another public agency member of the 
IEP team to also serve as the agency representative, so long as that 
individual meets the requirements of Sec. 300.344(a)(4).
    23. For a child with a disability being considered for initial 
provision of special education and related services, which teacher or 
teachers should attend the IEP meeting?
    A child's IEP team must include at least one of the child's regular 
education teachers (if the child is, or may be participating in the 
regular education environment) and at least one of the child's special 
education teachers, or, if appropriate, at least one of the child's 
special education providers (Sec. 300.344(a)(2) and (3)).
    Each IEP must include a statement of the present levels of 
educational performance, including a statement of how the child's 
disability affects the child's involvement and progress in the general 
curriculum (Sec. 300.347(a)(1)). At least one regular education teacher 
is a required member of the IEP team of a child who is, or may be, 
participating in the regular educational environment, regardless of the 
extent of that participation.
    The requirements of Sec. 300.344(a)(3) can be met by either: (1) a 
special education teacher of the child; or (2) another special education 
provider of the child, such as a speech pathologist, physical or 
occupational therapist, etc., if the related service consists of 
specially designed instruction and is considered special education under 
applicable State standards.
    Sometimes more than one meeting is necessary in order to finalize a 
child's IEP. In this process, if the special education teacher or 
special education provider who will be working with the child is 
identified, it would be useful to have that teacher or provider 
participate in the meeting with the parents and other members of the IEP 
team in finalizing the IEP. If this is not possible, the public agency 
must ensure that the teacher or provider has access to the child's IEP 
as soon as possible after it is finalized and before beginning to work 
with the child.
    Further, (consistent with Sec. 300.342(b)), the public agency must 
ensure that each regular education teacher, special education teacher, 
related services provider and other service provider of an eligible 
child under this part (1) has access to the child's IEP, and (2) is 
informed of his or her specific responsibilities related to implementing 
the IEP, and of the specific accommodations, modifications, and supports 
that must be provided to the child in accordance with the IEP. This 
requirement is crucial to ensuring that each child receives FAPE in 
accordance with his or her IEP, and that the IEP is appropriately and 
effectively implemented.
    24. What is the role of a regular education teacher in the 
development, review and revision of the IEP for a child who is, or may 
be, participating in the regular education environment?
    As required by Sec. 300.344(a)(2), the IEP team for a child with a 
disability must include at least one regular education teacher of the 
child if the child is, or may be, participating

[[Page 112]]

in the regular education environment. Section 300.346(d) further 
specifies that the regular education teacher of a child with a 
disability, as a member of the IEP team, must, to the extent 
appropriate, participate in the development, review, and revision of the 
child's IEP, including assisting in--(1) the determination of 
appropriate positive behavioral interventions and strategies for the 
child; and (2) the determination of supplementary aids and services, 
program modifications, and supports for school personnel that will be 
provided for the child, consistent with 300.347(a)(3) (Sec. 
300.344(d)).
    Thus, while a regular education teacher must be a member of the IEP 
team if the child is, or may be, participating in the regular education 
environment, the teacher need not (depending upon the child's needs and 
the purpose of the specific IEP team meeting) be required to participate 
in all decisions made as part of the meeting or to be present throughout 
the entire meeting or attend every meeting. For example, the regular 
education teacher who is a member of the IEP team must participate in 
discussions and decisions about how to modify the general curriculum in 
the regular classroom to ensure the child's involvement and progress in 
the general curriculum and participation in the regular education 
environment.
    Depending upon the specific circumstances, however, it may not be 
necessary for the regular education teacher to participate in 
discussions and decisions regarding, for example, the physical therapy 
needs of the child, if the teacher is not responsible for implementing 
that portion of the child's IEP.
    In determining the extent of the regular education teacher's 
participation at IEP meetings, public agencies and parents should 
discuss and try to reach agreement on whether the child's regular 
education teacher that is a member of the IEP team should be present at 
a particular IEP meeting and, if so, for what period of time. The extent 
to which it would be appropriate for the regular education teacher 
member of the IEP team to participate in IEP meetings must be decided on 
a case-by-case basis.
    25. If a child with a disability attends several regular classes, 
must all of the child's regular education teachers be members of the 
child's IEP team?
    No. The IEP team need not include more than one regular education 
teacher of the child. If the participation of more than one regular 
education teacher would be beneficial to the child's success in school 
(e.g., in terms of enhancing the child's participation in the general 
curriculum), it would be appropriate for them to attend the meeting.
    26. How should a public agency determine which regular education 
teacher and special education teacher will be members of the IEP team 
for a particular child with a disability?
    The regular education teacher who serves as a member of a child's 
IEP team should be a teacher who is, or may be, responsible for 
implementing a portion of the IEP, so that the teacher can participate 
in discussions about how best to teach the child.
    If the child has more than one regular education teacher responsible 
for carrying out a portion of the IEP, the LEA may designate which 
teacher or teachers will serve as IEP team member(s), taking into 
account the best interest of the child.
    In a situation in which not all of the child's regular education 
teachers are members of the child's IEP team, the LEA is strongly 
encouraged to seek input from the teachers who will not be attending. In 
addition, (consistent with Sec. 300.342(b)), the LEA must ensure that 
each regular education teacher (as well as each special education 
teacher, related services provider, and other service provider) of an 
eligible child under this part (1) has access to the child's IEP, and 
(2) is informed of his or her specific responsibilities related to 
implementing the IEP, and of the specific accommodations, modifications 
and supports that must be provided to the child in accordance with the 
IEP.
    In the case of a child whose behavior impedes the learning of the 
child or others, the LEA is encouraged to have a regular education 
teacher or other person knowledgeable about positive behavior strategies 
at the IEP meeting. This is especially important if the regular 
education teacher is expected to carry out portions of the IEP.
    Similarly, the special education teacher or provider of the child 
who is a member of the child's IEP team should be the person who is, or 
will be, responsible for implementing the IEP. If, for example, the 
child's disability is a speech impairment, the special education teacher 
on the IEP team could be the speech-language pathologist.
    27. For a child whose primary disability is a speech impairment, may 
a public agency meet its responsibility under Sec. 300.344(a)(3) to 
ensure that the IEP team includes ``at least one special education 
teacher, or, if appropriate, at least one special education provider of 
the child'' by including a speech-language pathologist on the IEP team?
    Yes, if speech is considered special education under State 
standards. As with other children with disabilities, the IEP team must 
also include at least one of the child's regular education teachers if 
the child is, or may be, participating in the regular education 
environment.
    28. Do parents and public agencies have the option of inviting any 
individual of their choice be participants on their child's IEP team?

[[Page 113]]

    The IEP team may, at the discretion of the parent or the agency, 
include ``other individuals who have knowledge or special expertise 
regarding the child * * *'' (Sec. 300.344(a)(6), italics added). Under 
Sec. 300.344(a)(6), these individuals are members of the IEP team. This 
is a change from prior law, which provided, without qualification, that 
parents or agencies could have other individuals as members of the IEP 
team at the discretion of the parents or agency.
    Under Sec. 300.344(c), the determination as to whether an 
individual has knowledge or special expertise, within the meaning of 
Sec. 300.344(a)(6), shall be made by the parent or public agency who 
has invited the individual to be a member of the IEP team.
    Part B does not provide for including individuals such as 
representatives of teacher organizations as part of an IEP team, unless 
they are included because of knowledge or special expertise regarding 
the child. (Because a representative of a teacher organization would 
generally be concerned with the interests of the teacher rather than the 
interests of the child, and generally would not possess knowledge or 
expertise regarding the child, it generally would be inappropriate for 
such an official to be a member of the IEP team or to otherwise 
participate in an IEP meeting.)
    29. Can parents or public agencies bring their attorneys to IEP 
meetings, and, if so under what circumstances? Are attorney's fees 
available for parents' attorneys if the parents are prevailing parties 
in actions or proceedings brought under Part B?
    Section 300.344(a)(6) authorizes the addition to the IEP team of 
other individuals at the discretion of the parent or the public agency 
only if those other individuals have knowledge or special expertise 
regarding the child. The determination of whether an attorney possesses 
knowledge or special expertise regarding the child would have to be made 
on a case-by-case basis by the parent or public agency inviting the 
attorney to be a member of the team.
    The presence of the agency's attorney could contribute to a 
potentially adversarial atmosphere at the meeting. The same is true with 
regard to the presence of an attorney accompanying the parents at the 
IEP meeting. Even if the attorney possessed knowledge or special 
expertise regarding the child (Sec. 300.344(a)(6)), an attorney's 
presence would have the potential for creating an adversarial atmosphere 
that would not necessarily be in the best interests of the child.
    Therefore, the attendance of attorneys at IEP meetings should be 
strongly discouraged. Further, as specified in Section 615(i)(3)(D)(ii) 
of the Act and Sec. 300.513(c)(2)(ii), Attorneys' fees may not be 
awarded relating to any meeting of the IEP team unless the meeting is 
convened as a result of an administrative proceeding or judicial action, 
or, at the discretion of the State, for a mediation conducted prior to 
the request for a due process hearing.
    30. Must related services personnel attend IEP meetings?
    Although Part B does not expressly require that the IEP team include 
related services personnel as part of the IEP team (Sec. 300.344(a)), 
it is appropriate for those persons to be included if a particular 
related service is to be discussed as part of the IEP meeting. Section 
300.344(a)(6) provides that the IEP team also includes ``at the 
discretion of the parent or the agency, other individuals who have 
knowledge or special expertise regarding the child, including related 
services personnel as appropriate. * * *'' (Italics added.)
    Further, Sec. 300.344(a)(3) requires that the IEP team for each 
child with a disability include ``at least one special education 
teacher, or, if appropriate, at least one special education provider of 
the child * * *'' This requirement can be met by the participation of 
either (1) a special education teacher of the child, or (2) another 
special education provider such as a speech-language pathologist, 
physical or occupational therapist, etc., if the related service 
consists of specially designed instruction and is considered special 
education under the applicable State standard.
    If a child with a disability has an identified need for related 
services, it would be appropriate for the related services personnel to 
attend the meeting or otherwise be involved in developing the IEP. As 
explained in the Committee Reports on the IDEA Amendments of 1997, 
``Related services personnel should be included on the team when a 
particular related service will be discussed at the request of the 
child's parents or the school.'' (H. Rep. No. 105-95, p. 103 (1997); S. 
Rep. No. 105-17, p. 23 (1997)). For example, if the child's evaluation 
indicates the need for a specific related service (e.g., physical 
therapy, occupational therapy, special transportation services, school 
social work services, school health services, or counseling), the agency 
should ensure that a qualified provider of that service either (1) 
attends the IEP meeting, or (2) provides a written recommendation 
concerning the nature, frequency, and amount of service to be provided 
to the child. This written recommendation could be a part of the 
evaluation report.
    A public agency must ensure that all individuals who are necessary 
to develop an IEP that will meet the child's unique needs, and ensure 
the provision of FAPE to the child, participate in the child's IEP 
meeting.
    31. Must the public agency ensure that all services specified in a 
child's IEP are provided?
    Yes. The public agency must ensure that all services set forth in 
the child's IEP are provided, consistent with the child's needs as

[[Page 114]]

identified in the IEP. The agency may provide each of those services 
directly, through its own staff resources; indirectly, by contracting 
with another public or private agency; or through other arrangements. In 
providing the services, the agency may use whatever State, local, 
Federal, and private sources of support are available for those purposes 
(see Sec. 300.301(a)); but the services must be at no cost to the 
parents, and the public agency remains responsible for ensuring that the 
IEP services are provided in a manner that appropriately meets the 
student's needs as specified in the IEP. The SEA and responsible public 
agency may not allow the failure of another agency to provide service(s) 
described in the child's IEP to deny or delay the provision of FAPE to 
the child. (See Sec. 300.142, Methods of ensuring services.)
    32. Is it permissible for an agency to have the IEP completed before 
the IEP meeting begins?
    No. Agency staff may come to an IEP meeting prepared with evaluation 
findings and proposed recommendations regarding IEP content, but the 
agency must make it clear to the parents at the outset of the meeting 
that the services proposed by the agency are only recommendations for 
review and discussion with the parents. Parents have the right to bring 
questions, concerns, and recommendations to an IEP meeting as part of a 
full discussion, of the child's needs and the services to be provided to 
meet those needs before the IEP is finalized.
    Public agencies must ensure that, if agency personnel bring drafts 
of some or all of the IEP content to the IEP meeting, there is a full 
discussion with the child's parents, before the child's IEP is 
finalized, regarding drafted content and the child's needs and the 
services to be provided to meet those needs.
    33. Must a public agency include transportation in a child's IEP as 
a related service?
    As with other related services, a public agency must provide 
transportation as a related service if it is required to assist the 
disabled child to benefit from special education. (This includes 
transporting a preschool-aged child to the site at which the public 
agency provides special education and related services to the child, if 
that site is different from the site at which the child receives other 
preschool or day care services.)
    In determining whether to include transportation in a child's IEP, 
and whether the child needs to receive transportation as a related 
service, it would be appropriate to have at the IEP meeting a person 
with expertise in that area. In making this determination, the IEP team 
must consider how the child's disability affects the child's need for 
transportation, including determining whether the child's disability 
prevents the child from using the same transportation provided to 
nondisabled children, or from getting to school in the same manner as 
nondisabled children.
    The public agency must ensure that any transportation service 
included in a child's IEP as a related service is provided at public 
expense and at no cost to the parents, and that the child's IEP 
describes the transportation arrangement.
    Even if a child's IEP team determines that the child does not 
require transportation as a related service, Section 504 of the 
Rehabilitation Act of 1973, as amended, requires that the child receive 
the same transportation provided to nondisabled children. If a public 
agency transports nondisabled children, it must transport disabled 
children under the same terms and conditions. However, if a child's IEP 
team determines that the child does not need transportation as a related 
service, and the public agency transports only those children whose IEPs 
specify transportation as a related service, and does not transport 
nondisabled children, the public agency would not be required to provide 
transportation to a disabled child.
    It should be assumed that most children with disabilities receive 
the same transportation services as nondisabled children. For some 
children with disabilities, integrated transportation may be achieved by 
providing needed accommodations such as lifts and other equipment 
adaptations on regular school transportation vehicles.
    34. Must a public agency provide related services that are required 
to assist a child with a disability to benefit from special education, 
whether or not those services are included in the list of related 
services in Sec. 300.24?
    The list of related services is not exhaustive and may include other 
developmental, corrective, or supportive services if they are required 
to assist a child with a disability to benefit from special education. 
This could, depending upon the unique needs of a child, include such 
services as nutritional services or service coordination.
    These determinations must be made on an individual basis by each 
child's IEP team.
    35. Must the IEP specify the amount of services or may it simply 
list the services to be provided?
    The amount of services to be provided must be stated in the IEP, so 
that the level of the agency's commitment of resources will be clear to 
parents and other IEP team members (Sec. 300.347(a)(6)). The amount of 
time to be committed to each of the various services to be provided must 
be (1) appropriate to the specific service, and (2) stated in the IEP in 
a manner that is clear to all who are involved in both the development 
and implementation of the IEP.
    The amount of a special education or related service to be provided 
to a child may be stated in the IEP as a range (e.g., speech therapy to 
be provided three times per week

[[Page 115]]

for 30-45 minutes per session) only if the IEP team determines that 
stating the amount of services as a range is necessary to meet the 
unique needs of the child. For example, it would be appropriate for the 
IEP to specify, based upon the IEP team's determination of the student's 
unique needs, that particular services are needed only under specific 
circumstances, such as the occurrence of a seizure or of a particular 
behavior. A range may not be used because of personnel shortages or 
uncertainty regarding the availability of staff.
    36. Under what circumstances is a public agency required to permit a 
child with a disability to use a school-purchased assistive technology 
device in the child's home or in another setting?
    Each child's IEP team must consider the child's need for assistive 
technology (AT) in the development of the child's IEP (Sec. 
300.346(a)(2)(v)); and the nature and extent of the AT devices and 
services to be provided to the child must be reflected in the child's 
IEP (Sec. 300.346(c)).
    A public agency must permit a child to use school-purchased 
assistive technology devices at home or in other settings, if the IEP 
team determines that the child needs access to those devices in 
nonschool settings in order to receive FAPE (to complete homework, for 
example).
    Any assistive technology devices that are necessary to ensure FAPE 
must be provided at no cost to the parents, and the parents cannot be 
charged for normal use, wear and tear. However, while ownership of the 
devices in these circumstances would remain with the public agency, 
State law, rather than Part B, generally would govern whether parents 
are liable for loss, theft, or damage due to negligence or misuse of 
publicly owned equipment used at home or in other settings in accordance 
with a child's IEP.
    37. Can the IEP team also function as the group making the placement 
decision for a child with a disability?
    Yes, a public agency may use the IEP team to make the placement 
decision for a child, so long as the group making the placement decision 
meets the requirements of Sec. Sec. 300.552 and 300.501(c), which 
requires that the placement decision be made by a group of persons, 
including the parents, and other persons knowledgeable about the child, 
the meaning of the evaluation data, and the placement options.
    38. If a child's IEP includes behavioral strategies to address a 
particular behavior, can a child ever be suspended for engaging in that 
behavior?
    If a child's behavior impedes his or her learning or that of others, 
the IEP team, in developing the child's IEP, must consider, if 
appropriate, development of strategies, including positive behavioral 
interventions, strategies and supports to address that behavior, 
consistent with Sec. 300.346(a)(2)(i). This means that in most cases in 
which a child's behavior that impedes his or her learning or that of 
others is, or can be readily anticipated to be, repetitive, proper 
development of the child's IEP will include the development of 
strategies, including positive behavioral interventions, strategies and 
supports to address that behavior. See Sec. 300.346(c). This includes 
behavior that could violate a school code of conduct. A failure to, if 
appropriate, consider and address these behaviors in developing and 
implementing the child's IEP would constitute a denial of FAPE to the 
child. Of course, in appropriate circumstances, the IEP team, which 
includes the child's parents, might determine that the child's 
behavioral intervention plan includes specific regular or alternative 
disciplinary measures, such as denial of certain privileges or short 
suspensions, that would result from particular infractions of school 
rules, along with positive behavior intervention strategies and 
supports, as a part of a comprehensive plan to address the child's 
behavior. Of course, if short suspensions that are included in a child's 
IEP are being implemented in a manner that denies the child access to 
the ability to progress in the educational program, the child would be 
denied FAPE.
    Whether other disciplinary measures, including suspension, are ever 
appropriate for behavior that is addressed in a child's IEP will have to 
be determined on a case by case basis in light of the particular 
circumstances of that incident. However, school personnel may not use 
their ability to suspend a child for 10 days or less at a time on 
multiple occasions in a school year as a means of avoiding appropriately 
considering and addressing the child's behavior as a part of providing 
FAPE to the child.
    39. If a child's behavior in the regular classroom, even with 
appropriate interventions, would significantly impair the learning of 
others, can the group that makes the placement decision determine that 
placement in the regular classroom is inappropriate for that child?
    The IEP team, in developing the IEP, is required to consider, when 
appropriate, strategies, including positive behavioral interventions, 
strategies and supports to address the behavior of a child with a 
disability whose behavior impedes his or her learning or that of others. 
If the IEP team determines that such supports, strategies or 
interventions are necessary to address the behavior of the child, those 
services must be included in the child's IEP. These provisions are 
designed to foster increased participation of children with disabilities 
in regular education environments or other less restrictive 
environments, not to serve as a basis for placing children with 
disabilities in more restrictive settings.

[[Page 116]]

    The determination of appropriate placement for a child whose 
behavior is interfering with the education of others requires careful 
consideration of whether the child can appropriately function in the 
regular classroom if provided appropriate behavioral supports, 
strategies and interventions. If the child can appropriately function in 
the regular classroom with appropriate behavioral supports, strategies 
or interventions, placement in a more restrictive environment would be 
inconsistent with the least restrictive environment provisions of the 
IDEA. If the child's behavior in the regular classroom, even with the 
provision of appropriate behavioral supports, strategies or 
interventions, would significantly impair the learning of others, that 
placement would not meet his or her needs and would not be appropriate 
for that child.
    40. May school personnel during a school year implement more than 
one short-term removal of a child with disabilities from his or her 
classroom or school for misconduct?
    Yes. Under Sec. 300.520(a)(1), school personnel may order removal 
of a child with a disability from the child's current placement for not 
more than 10 consecutive school days for any violation of school rules, 
and additional removals of not more than 10 consecutive school days in 
that same school year for separate incidents of misconduct, as long as 
these removals do not constitute a change of placement under Sec. 
300.519(b). However, these removals are permitted only to the extent 
they are consistent with discipline that is applied to children without 
disabilities. Also, school personnel should be aware of constitutional 
due process protections that apply to suspensions of all children. Goss 
v. Lopez, 419 U.S. 565 (1975). Section 300.121(d) addresses the extent 
of the obligation to provide services after a child with a disability 
has been removed from his or her current placement for more than 10 
school days in the same school year.

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[64 FR 34049, June 24, 1999]

  Appendix C to Part 300;--Implementation of the 20 Percebt Rule Under 
                              Sec. 300.233

    This appendix is intended to assist States and LEAs to implement the 
``20 percent rule'' under Part B (section 613(a)(2)(C)) of the 
Individuals with Disabilities Education Act (IDEA), and, specifically, 
the regulation implementing that provision in Sec. 300.233. The 
purposes of the appendix are to--(1) provide background information 
about the 20 percent rule and its intended effect, including specifying 
which funds under Part B of the Act are covered by the provision (as 
described in Sec. 300.233), and the basis for the Department's

[[Page 169]]

decision regarding those funds; and (2) include examples showing how the 
20 percent rule would apply in several situations.

                              A. Background

    1. Purpose of 20 Percent Rule. The IDEA Amendments of 1997 (Pub. L. 
105-17) added a provision related to the permissive treatment of a 
portion of Part B funds by LEAs for maintenance of effort and non-
supplanting purposes in certain fiscal years (see section 613(a)(2)(C) 
of the Act and Sec. 300.233). Under that provision, for any fiscal year 
(FY) for which the appropriation for section 611 of IDEA exceeds $4.1 
billion, an LEA may treat as local funds, for maintenance of effort and 
non-supplanting purposes, up to 20 percent of the amount it receives 
that exceeds the amount it received under Part B during the prior year.
    Thus, under Sec. 300.233, an LEA is able to meet the maintenance of 
effort requirement of Sec. 300.231 and the non-supplanting requirement 
of Sec. 300.230(c) even though it reduces the amount it spends of other 
local or local and State funds, as the case may be, by an amount equal 
to the amount of Federal funds that may be treated as local funds.
    2. 20 Percent Rule Applies Only to LEA Subgrants. Following 
enactment of the IDEA Amendments of 1997 (and publication of Part B 
regulations on March 12, 1999), State and local educational agency 
officials stated that it is not clear from the Act and regulations 
whether the funds affected by the 20 percent rule are only those that an 
LEA receives through statutory subgrants under section 611(g), or 
whether the provision also applies to other Part B funding sources 
(i.e., subgrants to LEAs for capacity-building and improvement under 
section 611(f)(4); other funds the SEA may provide to LEAs under section 
611(f); or funds provided under section 619 (Preschool Grants program)).
    Further, because section 613(a)(2)(C) refers to an amount of funds 
that an LEA ``receives'' in one fiscal year compared to the amount it 
``received'' in the prior fiscal year (and because agencies may, at any 
one point in time, be using funds appropriated in several Federal fiscal 
years), agency officials were uncertain as to how to determine that an 
LEA had ``received'' Federal funds.
    Because the statute and regulations were not sufficiently clear with 
respect to which precise funds are affected by the 20 percent rule, this 
could have resulted in the provision being interpreted and applied 
differently from LEA to LEA. If that situation were to occur, it could 
result in a significant increase in the number of audit exceptions 
against LEAs.
    Given the confusion about which funding sources are affected by the 
20 percent rule, there was a critical need to set out in the regulations 
a clear interpretation of section 613(a)(2)(C) in order to support its 
consistent application across LEAs and States, and to reduce the 
potential for audit exceptions. Thus, on June 10, 2000, the Department 
published a notice of proposed rulemaking (NPRM) regarding this 
provision (65 FR 30314). The NPRM stated that--
    In light of the statutory structure for distribution of Federal 
funds to LEAs, we believe that the most reasonable interpretation is to 
apply that provision only to subgrants to LEAs under section 611(g) of 
the Act (Sec. 300.712 of the regulations) from funds appropriated from 
one Federal fiscal year compared to funds appropriated for the prior 
Federal fiscal year. (Emphasis added.)
    Thus, the NPRM proposed to exclude the other Federal funds under 
Part B of the Act (i.e., Subgrants to LEAs for capacity-building and 
improvement under section 611(f)(4) (Sec. 300.622); other funds the SEA 
may provide to LEAs under section 611(f) (Sec. 300.602); and preschool 
grant funds under section 619 (34 CFR part 301)) from the funds that 
could be treated as local funds. The reasons for excluding these other 
Part B funds were stated in the NPRM, as follows:
     If IDEA funds that States have the authority to 
provide to LEAs on a discretionary basis (such as those identified in 
the preceding paragraph) are included in the 20 percent calculation, it 
would result in some LEAs receiving a proportionately greater benefit 
from this provision than other LEAs, based on receipt of funds that may 
be earmarked for a specific, time-limited purpose. This would lead to 
inequitable results of the Sec. 300.233 exception across LEAs in a 
State.
     Including section 619 formula grant funds (34 CFR 
part 301) in the calculation does not appear to be justified as the 
``trigger'' appropriation amount applies only with respect to the amount 
appropriated under section 611.
    The Department subsequently determined that the position taken in 
the NPRM (that the provision under Sec. 300.233 should apply only to 
LEA subgrant funds under section 611(g) of the Act) is the most 
appropriate and reasonable position to follow in implementing the 20 
percent rule. Therefore, the proposed provision in Sec. 300.233(a)(1) 
was retained, without change, in the final regulations.

                  B. Application of the 20 percent rule

         1. Examples Related to Implementing the 20 percent rule

    The following are examples showing how the 20 percent provision 
would apply under several situations:

     Example 1: An LEA receives $100,000 in Federal 
LEA Subgrant funds under section 611(g) of the Act from the 
appropriation for one fiscal year (FY-1), and $120,000 in section 611(g) 
funds from the appropriation for the following fiscal year (FY-2). The 
LEA may

[[Page 170]]

spend and treat as local funds up to 20 percent of the $20,000 in 
section 611(g) funds it receives from FY-2 (i.e., up to $4,000), since 
this is the amount that exceeds the amount it received from the prior 
year.
     Example 1-A: In Example 1, an LEA in FY-2 is 
uncertain whether to exercise its option to treat as local funds during 
FY-2 up to $4,000 of its section 611(g) funds received from FY-2, and 
wishes to wait until the carry-over year to make a decision. If the LEA 
decides to exercise its option during the carry-over period regarding 
the $4,000 from the FY-2 appropriation, it could do so as long as those 
funds are used within the carry-over period for FY-2.
     Example 1-B: An LEA receives $100,000 in section 
611(g) funds from FY-1, $120,000 from FY-2 and $140,000 from FY-3. The 
LEA may spend and treat as local funds up to 20 percent of the $20,000 
from FY-2 funds and $20,000 of FY-3 funds (i.e., up to $4,000 for each 
year). Thus, if its FY-2 funds are not used until FY-3, and the LEA so 
chooses, it may spend and treat as local funds during FY-3 a total of up 
to $8,000 in section 611(g) funds (i.e., $4,000 from FY-2 and $4,000 
from FY-3), provided those funds are obligated by the end of FY-3.
     Example 2: An LEA from one fiscal year (FY-1) 
receives $100,000 in section 611(g) funds and $20,000 in SEA 
discretionary funds under section 611(f) of the Act; and from the 
following year (FY-2) receives $120,000 in section 611(g) funds, but 
does not receive any funds under section 611(f). The LEA may spend and 
treat up to 20 percent of the $20,000 in section 611(g) funds it 
receives from FY-2 (i.e. up to $4,000), since $20,000 is the amount of 
section 611(g) funds that exceeds the amount it received from FY-1.
     Example 3: An LEA had all of its section 611(g) 
funds ($100,000) withheld from one fiscal year (FY-1); but in the next 
fiscal year (FY-2), the LEA received a total of $220,000 in section 
611(g) funds (i.e., $100,000 from FY-1, plus $120,000 from FY-2). 
Because the LEA would have been entitled to $100,000 in FY-1, the LEA 
may spend and treat as local funds up to 20 percent of the $20,000 from 
FY-2 that exceeded the FY-1 allotment (i.e., up to $4,000).
     Example 4: An LEA received $100,000 under section 
611(g) from one fiscal year (FY-1), and would have received $120,000 in 
section 611(g) funds for the next fiscal year (FY-2); but the LEA has 
had all of its section 611(g) funds withheld in FY-2 because of a 
finding of noncompliance under Sec. 300.197 or Sec. 300.587. The LEA 
would have no section 611(g) funds that could be spent or treated as 
local funds until those funds are released.
     Example 4-A: In example 4, the SEA subsequently 
determines that the LEA is in compliance, and releases the FY-2 funds to 
the LEA later in that fiscal year. The LEA could then spend and treat as 
local funds up to 20 percent of the $20,000 that exceeds the amount it 
received in FY-1 (i.e., up to $4,000). Those funds could be used by the 
LEA for the remainder of FY-2 and through the end of the carry-over 
period for FY-2 funding.

2. Auditing for Compliance with Sec. 300.231 and the 20 percent rule in 
                              Sec. 300.233

    The following provides guidance for use by auditors in determining 
if LEAs are in compliance with the maintenance of effort requirement in 
Sec. 300.231 and the 20 percent rule in Sec. 300.233:
    a. Meeting the Maintenance of Effort Requirement. In order to be 
eligible to receive an IDEA-Part B subgrant in any particular fiscal 
year, an LEA is required to demonstrate that it has budgeted an amount 
of State and local funds, or just local funds, to be spent on special 
education and related services that equals or exceeds (on either an 
aggregate or per capita basis) the amount of those funds spent by the 
LEA for those purposes in the prior fiscal year, or in the most recent 
prior fiscal year for which information is available. 34 CFR 300.231.
    b. Auditing Compliance with Sec. 300.231. Auditors, in determining 
if an LEA has complied with Sec. 300.231 in any particular fiscal year, 
review the actual level of expenditures of State and local funds, or 
just local funds, on special education and related services for the year 
in question and the prior year. For example, consider an LEA that, in 
the LEA's FY-1, spent a total of $1,000,000 of local funds on special 
education and related services to serve 100 students with disabilities. 
(For this discussion, assume that the LEA does not receive any State 
funds for any year for special education and related services.) An 
auditor, in trying to determine if the LEA, in its FY-2, had complied 
with Sec. 300.231, would review the LEA's expenditure of local funds on 
special education and related services. If, in the LEA's FY-2, the LEA 
served 100 students with disabilities and spent $1,000,000 or more in 
local funds on special education and related services, it would have met 
the requirements of Sec. 300.231 for FY-2.
    c. Application of the 20 percent rule to Sec. 300.231. If the LEA 
in the preceding example had spent only $996,000 of local funds on 
special education and related services for its 100 students with 
disabilities in its FY-2 (not counting any section 611(g) subgrant funds 
that could be considered local funds under the 20 percent rule), then it 
would have failed to meet its obligation under Sec. 300.231, and an 
auditor would question $4,000 of the LEA's IDEA-Part B subgrant 
expenditures in that year.
    This questioned cost, however, could be avoided, if the LEA had 
available, and spent, $4,000 of Federal funds under the 20 percent rule 
during its FY-2. These funds may be available from a variety of sources 
(see Examples in paragraph 1). If, as described in

[[Page 171]]

Example 1 of paragraph 1 the LEA had received from the Federal FY-2 
appropriation, a section 611(g) subgrant that was $20,000 greater than 
the subgrant it received from the Federal FY-1 appropriation, then up to 
$4,000 of that subgrant could be treated as local funds. The LEA, 
however, would have to spend at least $4,000 of its Federal FY-2 section 
611(g) subgrant during its FY-2 in order for those funds to count as 
part of its local expenditures for that year for purposes of Sec. 
300.231.
    In this example, if the LEA had carried over all of its Federal FY-2 
section 611(g) subgrant to the LEA's FY-3 (and thus did not spend any of 
those funds during its FY-2), then none of the section 611(g) subgrant 
funds subject to the 20 percent rule could be considered as local funds 
for purposes of determining compliance with Sec. 300.231. (The reason 
for this is that auditors, in determining an LEA's compliance with Sec. 
300.231, examine State and local, or local funds the LEA actually spent 
on special education and related services, and not those funds that the 
LEA could, but did not, spend for those purposes.)
    If the LEA, in its FY-2, spent $4,000 of its Federal FY-2 section 
611(g) subgrant, then the LEA could count those expenditures and bring 
itself into compliance with Sec. 300.231 (i.e., $996,000 of the LEA's 
own local funds spent on special education and related services plus the 
$4,000 of Federal FY-2 section 611(g) funds that can be counted as local 
funds equals a total of $1,000,000 of local expenditures on special 
education in its FY-2--the amount of local expenditures needed to comply 
with Sec. 300.231). However, if the LEA elected to take this step, it 
could not count any of the Federal FY-2 section 611(g) subgrant funds 
that it will spend in its FY-3 as local funds.
    If the LEA, in its FY-2, spent only $3,000 of its Federal FY-2 
section 611(g) subgrant funds, then those funds could be counted by the 
LEA as local funds in calculating its compliance with Sec. 300.231 for 
its FY-2. If the remaining $1,000 of Federal FY-2 funds available to be 
considered local funds were spent in the LEA's FY-3, those funds could 
be considered in determining the LEA's compliance with Sec. 300.231 for 
its FY-3. (Note, However, that if in its FY-2 the LEA had only spent 
$996,000 of local funds and $3,000 of its Federal funds, it would not 
have met the requirements of Sec. 300.231. In this case the auditor 
would have $1,000 of questioned costs ($1,000,000 - [$996,000 + $3,000] 
= $1,000) for FY-2).

[66 FR 1476, Jan. 8, 2001]



PART 301_PRESCHOOL GRANTS FOR CHILDREN WITH DISABILITIES--Table of Contents




                            Subpart A_General

Sec.
301.1 Purpose of the Preschool Grants for Children With Disabilities 
          program.
301.2-301.3 [Reserved]
301.4 Applicable regulations.
301.5 Applicable definitions.
301.6 Applicability of part C of the Act to 2-year-old children with 
          disabilities.

                 Subpart B_State Eligibility for a Grant

301.10 Eligibility of a State to receive a grant.
301.11 [Reserved]
301.12 Sanctions if a State does not make a free appropriate public 
          education available to all preschool children with 
          disabilities.

                Subpart C_Allocations of Funds to States

301.20 Allocations to States.
301.21 Increase in funds.
301.22 Limitation.
301.23 Decrease in funds.
301.24 State-level activities.
301.25 Use of funds for State administration.
301.26 Use of State agency allocations.

       Subpart D_Allocation of Funds to Local Educational Agencies

301.30 Subgrants to local educational agencies.
301.31 Allocations to local educational agencies.
301.32 Reallocation of local educational agency funds.

    Authority: 20 U.S.C. 1419, unless otherwise noted.

    Source: 63 FR 29930, June 1, 1998, unless otherwise noted.



                            Subpart A_General



Sec. 301.1  Purpose of the Preschool Grants for Children With Disabilities 
program.

    The purpose of the Preschool Grants for Children With Disabilities 
program (Preschool Grants program) is to provide grants to States to 
assist them in providing special education and related services--
    (a) To children with disabilities aged three through five years; and

[[Page 172]]

    (b) At a State's discretion, to two-year-old children with 
disabilities who will turn three during the school year.

(Authority: 20 U.S.C. 1419(a))



Sec. Sec. 301.2-301.3  [Reserved]



Sec. 301.4  Applicable regulations.

    The following regulations apply to the Preschool Grants program:
    (a) The Education Department General Administrative Regulations 
(EDGAR) in title 34 of the Code of Federal Regulations--
    (1) Part 76 (State-Administered Programs) except Sec. Sec. 76.125-
76.137 and 76.650-76.662;
    (2) Part 77 (Definitions that Apply to Department Regulations);
    (3) Part 79 (Intergovernmental Review of Department of Education 
Programs and Activities);
    (4) Part 80 (Uniform Administrative Requirements for Grants and 
Cooperative Agreements to State and Local Governments);
    (5) Part 81 (General Education Provision Act--Enforcement);
    (6) Part 82 (New Restrictions on Lobbying); and
    (7) Part 85 (Governmentwide Debarment and Suspension 
(Nonprocurement) and Governmentwide Requirements for a Drug-Free 
Workplace (Grants)).
    (b) The regulations in this part 301.
    (c) The regulations in 34 CFR part 300.

(Authority: 20 U.S.C. 1419)



Sec. 301.5  Applicable definitions.

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


Applicant
Application
Award
EDGAR
Fiscal year
Grant period
Secretary
Subgrant

    (b) Other definitions. The following definitions also apply to this 
part:
    Act means the Individuals with Disabilities Education Act, as 
amended.
    Part B child count means the child count required by section 
611(d)(2) of the Act.
    Preschool means the age range of 3 through 5 years.
    State means each of the 50 States, the District of Columbia, and the 
Commonwealth of Puerto Rico.

(Authority: 20 U.S.C. 1402, 1419)



Sec. 301.6  Applicability of part C of the Act to 2-year-old children with 
disabilities.

    Part C of the Act does not apply to any child with disabilities 
receiving a free appropriate public education, in accordance with part B 
of the Act, with funds received under the Preschool Grants program.

(Authority: 20 U.S.C. 1419(h))



                 Subpart B_State Eligibility for a Grant



Sec. 301.10  Eligibility of a State to receive a grant.

    A State is eligible to receive a grant if--
    (a) The State is eligible under 34 CFR part 300; and
    (b) The State demonstrates to the satisfaction of the Secretary that 
it has in effect policies and procedures that assure the provision of a 
free appropriate public education--
    (1) For all children with disabilities aged 3 through 5 years in 
accordance with the requirements in 34 CFR part 300; and
    (2) For any 2-year-old children, provided services by the SEA or by 
an LEA or ESA under Sec. 301.1.

(Approved by the Office of Management and Budget under control number 
1820-0030)

(Authority: 20 U.S.C. 1419 (a), (b))



Sec. 301.11  [Reserved]



Sec. 301.12  Sanctions if a State does not make a free appropriate public 
education available to all preschool children with disabilities.

    If a State does not meet the requirements in section 619(b) of the 
Act--
    (a) The State is not eligible for a grant under the Preschool Grant 
program;

[[Page 173]]

    (b) The State is not eligible for funds under 34 CFR part 300 for 
children with disabilities aged 3 through 5 years; and
    (c) No SEA, LEA, ESA, or other public institution or agency within 
the State is eligible for a grant under Subpart 2 of part D of the Act 
if the grant relates exclusively to programs, projects, and activities 
pertaining to children with disabilities aged 3 through 5 years.

(Authority: 20 U.S.C. 1411(d)(2) and (e)(2)(B); 1419(b); 1461(j))



                 Subpart C_Allocation of Funds to States



Sec. 301.20  Allocations to States.

    After reserving funds for studies and evaluations under section 
674(e) of the Act, the Secretary allocates the remaining amount among 
the States in accordance with Sec. Sec. 301.21-301.23.

(Authority: 20 U.S.C. 1419(c)(1))



Sec. 301.21  Increase in funds.

    If the amount available for allocation to States under Sec. 301.20 
is equal to or greater than the amount allocated to the States under 
section 619 of the Act for the preceding fiscal year, those allocations 
are calculated as follows:
    (a) Except as provided in Sec. 301.22, the Secretary--
    (1) Allocates to each State the amount it received for fiscal year 
1997;
    (2) Allocates 85 percent of any remaining funds to States on the 
basis of their relative populations of children aged 3 through 5; and
    (3) Allocates 15 percent of those remaining funds to States on the 
basis of their relative populations of children described in paragraph 
(a)(2) of this section who are living in poverty.
    (b) For the purpose of making grants under this section, the 
Secretary uses the most recent population data, including data on 
children living in poverty, that are available and satisfactory to the 
Secretary.

(Authority: 20 U.S.C. 1419(c)(2)(A))



Sec. 301.22  Limitation.

    (a) Notwithstanding Sec. 301.21, allocations under that section are 
subject to the following:
    (1) No State's allocation may be less than its allocation for the 
preceding fiscal year.
    (2) No State's allocation may be less than the greatest of--
    (i) The sum of--
    (A) The amount it received for fiscal year 1997; and
    (B) One-third of one percent of the amount by which the amount 
appropriated under section 619(j) of the Act exceeds the amount 
appropriated under section 619 of the Act for fiscal year 1997;
    (ii) The sum of--
    (A) The amount it received for the preceding fiscal year; and
    (B) That amount multiplied by the percentage by which the increase 
in the funds appropriated from the preceding fiscal year exceeds 1.5 
percent; or
    (iii) The sum of--
    (A) The amount it received for the preceding fiscal year; and
    (B) That amount multiplied by 90 percent of the percentage increase 
in the amount appropriated from the preceding fiscal year.
    (b) Notwithstanding paragraph (a)(2) of this section, no State's 
allocation under Sec. 301.21 may exceed the sum of--
    (1) The amount it received for the preceding fiscal year; and
    (2) That amount multiplied by the sum of 1.5 percent and the 
percentage increase in the amount appropriated.
    (c) If the amount available for allocation to States under Sec. 
301.21 and paragraphs (a) and (b) of this section is insufficient to pay 
those allocations in full, the Secretary ratably reduces those 
allocations, subject to paragraph (a)(1) of this section.

(Authority: 20 U.S.C. 1419(c)(2)(B) and (C))



Sec. 301.23  Decrease in funds.

    If the amount available for allocations to States under Sec. 301.20 
is less than the amount allocated to the States under section 619 of the 
Act for the preceding fiscal year, those allocations are calculated as 
follows:
    (a) If the amount available for allocations is greater than the 
amount allocated to the States for fiscal year 1997, each State is 
allocated the sum of--
    (1) The amount it received for fiscal year 1997; and

[[Page 174]]

    (2) An amount that bears the same relation to any remaining funds as 
the increase the State received for the preceding fiscal year over 
fiscal year 1997 bears to the total of those increases for all States.
    (b)(1) If the amount available for allocations is equal to the 
amount allocated to the States for fiscal year 1997, each State is 
allocated the amount it received for that year.
    (2) If the amount available is less than the amount allocated to 
States for fiscal year 1997, the Secretary allocates amounts equal to 
the allocations for fiscal year 1997, ratably reduced.

(Authority: 20 U.S.C. 1419(c)(3))



Sec. 301.24  State-level activities.

    (a) Each State may retain not more than the amount described in 
paragraph (b) of this section for administration and other State-level 
activities in accordance with Sec. Sec. 301.25 and 301.26.
    (b) For each fiscal year, the Secretary determines and reports to 
the SEA an amount that is 25 percent of the amount the State received 
under section 619 of the Act for fiscal year 1997, cumulatively adjusted 
by the Secretary for each succeeding fiscal year by the lesser of--
    (1) The percentage increase, if any, from the preceding fiscal year 
in the State's allocation under section 619 of the Act; or
    (2) The rate of inflation, as measured by the percentage increase, 
if any, from the preceding fiscal year in the Consumer Price Index For 
All Urban Consumers, published by the Bureau of Labor Statistics of the 
Department of Labor.

(Authority: 20 U.S.C. 1419(d))



Sec. 301.25  Use of funds for State administration.

    (a) For the purpose of administering section 619 of the Act 
(including the coordination of activities under Part B of the Act with, 
and providing technical assistance to, other programs that provide 
services to children with disabilities), each State may use not more 
than twenty percent of the maximum amount it may retain under Sec. 
301.24 for any fiscal year.
    (b) Funds described in paragraph (a) of this section may also be 
used for the administration of part C of the Act, if the SEA is the lead 
agency for the State under that part.

(Authority: 20 U.S.C. 1419(e))



Sec. 301.26  Use of State agency allocations.

    Each State shall use any funds it retains under Sec. 301.24 and 
does not use for administration under Sec. 301.25 for any of the 
following:
    (a) Support services (including establishing and implementing the 
mediation process required by section 615(e) of the Act), which may 
benefit children with disabilities younger than 3 or older than 5 as 
long as those services also benefit children with disabilities aged 3 
through 5.
    (b) Direct services for children eligible for services under section 
619 of the Act.
    (c) Developing a State improvement plan under subpart 1 of part D of 
the Act.
    (d) Activities at the State and local levels to meet the performance 
goals established by the State under section 612(a)(16) of the Act and 
to support implementation of the State improvement plan under subpart 1 
of part D of the Act if the State receives funds under that subpart.
    (e) Supplementing other funds used to develop and implement a 
Statewide coordinated services system designed to improve results for 
children and families, including children with disabilities and their 
families, but not to exceed one percent of the amount received by the 
State under section 619 of the Act for a fiscal year.

(Authority: 20 U.S.C. 1419(f))



       Subpart D_Allocation of Funds to Local Educational Agencies



Sec. 301.30  Subgrants to local educational agencies.

    Each State that receives a grant under section 619 of the Act for 
any fiscal year shall distribute any funds it does not retain under 
Sec. 301.24 to local educational agencies in the State that

[[Page 175]]

have established their eligibility under section 613 of the Act.

(Authority: 20 U.S.C. 1419(g)(1))



Sec. 301.31  Allocations to local educational agencies.

    (a) Base payments. The State shall first award each agency described 
in Sec. 301.30 the amount that agency would have received under section 
619 of the Act for fiscal year 1997 if the State had distributed 75 
percent of its grant for that year under section 619(c)(3), as then in 
effect.
    (b) Base payment adjustments. For fiscal year 1998 and beyond--
    (1) If a new LEA is created, the State shall divide the base 
allocation determined under paragraph (a) of this section for the LEAs 
that would have been responsible for serving children with disabilities 
now being served by the new LEA, among the new LEA and affected LEAs 
based on the relative numbers of children with disabilities ages 3 
through 5 currently provided special education by each of the LEAs;
    (2) If one or more LEAs are combined into a single new LEA, the 
State shall combine the base allocations of the merged LEAs; and
    (3) If for two or more LEAs, geographic boundaries or administrative 
responsibility for providing services to children with disabilities ages 
3 through 5 changes, the base allocations of affected LEAs shall be 
redistributed among affected LEAs based on the relative numbers of 
children with disabilities ages 3 through 5 currently provided special 
education by each affected LEA.
    (c) Allocation of remaining funds. After making allocations under 
paragraph (a) of this section, the State shall--
    (1) Allocate 85 percent of any remaining funds to those agencies on 
the basis of the relative numbers of children enrolled in public and 
private elementary and secondary schools within the agency's 
jurisdiction; and
    (2) Allocate 15 percent of those remaining funds to those agencies 
in accordance with their relative numbers of children living in poverty, 
as determined by the SEA.
    (3) For the purpose of making grants under this section, States must 
apply on a uniform basis across all LEAs the best data that are 
available to them on the numbers of children enrolled in public and 
private elementary and secondary schools and the numbers of children 
living in poverty.

(Authority: 20 U.S.C. 1419(g)(1))



Sec. 301.32  Reallocation of local education agency funds.

    (a) If a SEA determines that an LEA is adequately providing a free 
appropriate public education to all children with disabilities aged 3 
through 5 residing in the area served by that agency with State and 
local funds, the SEA may reallocate any portion of the funds under 
section 619 of the Act that are not needed by that local agency to 
provide a free appropriate public education to other local educational 
agencies in the State that are not adequately providing special 
education and related services to all children with disabilities aged 3 
through 5 residing in the areas they serve.
    (b) If a State provides services to preschool children with 
disabilities because some or all LEAs and ESAs are unable or unwilling 
to provide appropriate programs, the SEA may use payments that would 
have been available to those LEAs or ESAs to provide special education 
and related services to children with disabilities aged 3 through 5 
years, and to two-year-old children with disabilities receiving services 
consistent with Sec. 301.1 who are residing in the area served by those 
LEAs and ESAs.

(Authority: 20 U.S.C. 1414(d), 1419(g)(2))



PART 303_EARLY INTERVENTION PROGRAM FOR INFANTS AND TODDLERS WITH 
DISABILITIES--Table of Contents




                            Subpart A_General

           Purpose, Eligibility, and Other General Provisions

Sec.
303.1 Purpose of the early intervention program for infants and toddlers 
          with disabilities.
303.2 Eligible recipients of an award.
303.3 Activities that may be supported under this part.
303.4 Limitation on eligible children.
303.5 Applicable regulations.

[[Page 176]]

                               Definitions

303.6 Act.
303.7 Children.
303.8 Council.
303.9 Days.
303.10 Developmental delay.
303.11 Early intervention program.
303.12 Early intervention services.
303.13 Health services.
303.14 IFSP.
303.15 Include; including.
303.16 Infants and toddlers with disabilities.
303.17 Multidisciplinary.
303.18 Natural environments.
303.19 Parent.
303.20 Policies.
303.21 Public agency.
303.22 Qualified.
303.23 Service coordination (case management).
303.24 State.
303.25 EDGAR definitions that apply.

                 Subpart B_State Application for a Grant

                          General Requirements

303.100 Conditions of assistance.
303.101 How the Secretary disapproves a State's application or statement 
          of assurances.

                          Public Participation

303.110 General requirements and timelines for public participation.
303.111 Notice of public hearings and opportunity to comment.
303.112 Public hearings.
303.113 Reviewing public comments received.

                         Statement of Assurances

303.120 General.
303.121 Reports and records.
303.122 Control of funds and property.
303.123 Prohibition against commingling.
303.124 Prohibition against supplanting.
303.125 Fiscal control.
303.126 Payor of last resort.
303.127 Assurance regarding expenditure of funds.
303.128 Traditionally underserved groups.

              General Requirements for a State Application

303.140 General.
303.141 Information about the Council.
303.142 Designation of lead agency.
303.143 Designation regarding financial responsibility.
303.144 Assurance regarding use of funds.
303.145 Description of use of funds.
303.146 Information about public participation.
303.147 Services to all geographic areas.
303.148 Transition to preschool programs.

       Components of a Statewide System--Application Requirements

303.160 Minimum components of a statewide system.
303.161 State definition of developmental delay.
303.162 Central directory.
303.163 [Reserved]
303.164 Public awareness program.
303.165 Comprehensive child find system.
303.166 Evaluation, assessment, and nondiscriminatory procedures.
303.167 Individualized family service plans.
303.168 Comprehensive system of personnel development (CSPD).
303.169 Personnel standards.
303.170 Procedural safeguards.
303.171 Supervision and monitoring of programs.
303.172 Lead agency procedures for resolving complaints.
303.173 Policies and procedures related to financial matters.
303.174 Interagency agreements; resolution of individual disputes.
303.175 Policy for contracting or otherwise arranging for services.
303.176 Data collection.

             Participation by the Secretary of the Interior

303.180 Payments to the Secretary of the Interior for Indian tribes and 
          tribal organizations.

            Subpart C_Procedures for Making Grants to States

303.200 Formula for State allocations.
303.201 Distribution of allotments from non-participating States.
303.202 Minimum grant that a State may receive.
303.203 Payments to the Secretary of the Interior.
303.204 Payments to the jurisdictions.

Subpart D_Program and Service Components of a Statewide System of Early 
                          Intervention Services

                                 General

303.300 State eligibility criteria and procedures.
303.301 Central directory.

                      Identification and Evaluation

303.320 Public awareness program.
303.321 Comprehensive child find system.
303.322 Evaluation and assessment.
303.323 Nondiscriminatory procedures.

               Individualized Family Service Plans (IFSPs)

303.340 General.

[[Page 177]]

303.341 [Reserved]
303.342 Procedures for IFSP development, review, and evaluation.
303.343 Participants in IFSP meetings and periodic reviews.
303.344 Content of an IFSP.
303.345 Provision of services before evaluation and assessment are 
          completed.
303.346 Responsibility and accountability.

                    Personnel Training and Standards

303.360 Comprehensive system of personnel development.
303.361 Personnel standards.

                     Subpart E_Procedural Safeguards

                                 General

303.400 General responsibility of lead agency for procedural safeguards.
303.401 Definitions of consent, native language, and personally 
          identifiable information.
303.402 Opportunity to examine records.
303.403 Prior notice; native language.
303.404 Parent consent.
303.405 Parent right to decline service.
303.406 Surrogate parents.

      Mediation and Due Process Procedures for Parents and Children

303.419 Mediation.
303.420 Due process procedures.
303.421 Appointment of an impartial person.
303.422 Parent rights in administrative proceedings.
303.423 Convenience of proceedings; timelines.
303.424 Civil action.
303.425 Status of a child during proceedings.

                             Confidentiality

303.460 Confidentiality of information.

                     Subpart F_State Administration

                                 General

303.500 Lead agency establishment or designation.
303.501 Supervision and monitoring of programs.

             Lead Agency Procedures for Resolving Complaints

303.510 Adopting complaint procedures.
303.511 An organization or individual may file a complaint.
303.512 Minimum State complaint procedures.

          Policies and Procedures Related to Financial Matters

303.520 Policies related to payment for services.
303.521 Fees.
303.522 Identification and coordination of resources.
303.523 Interagency agreements.
303.524 Resolution of disputes.
303.525 Delivery of services in a timely manner.
303.526 Policy for contracting or otherwise arranging for services.
303.527 Payor of last resort.
303.528 Reimbursement procedure.

                         Reporting Requirements

303.540 Data collection.

                  Use of Funds for State Administration

303.560 Use of funds by the lead agency.

            Subpart G_State Interagency Coordinating Council

                                 General

303.600 Establishment of Council.
303.601 Composition.
303.602 Use of funds by the Council.
303.603 Meetings.
303.604 Conflict of interest.

                        Functions of the Council

303.650 General.
303.651 Advising and assisting the lead agency in its administrative 
          duties.
303.652 Applications.
303.653 Transitional services.
303.654 Annual report to the Secretary.

    Authority: 20 U.S.C. 1431-1445, unless otherwise noted.

    Source: 58 FR 40959, July 30, 1993, unless otherwise noted.

    Editorial Note: Nomenclature changes to part 303 appear at 63 FR 
18293, Apr. 14, 1998.



                            Subpart A_General

           Purpose, Eligibility, and Other General Provisions



Sec. 303.1  Purpose of the early intervention program for infants and 
toddlers with disabilities.

    The purpose of this part is to provide financial assistance to 
States to--
    (a) Maintain and implement a statewide, comprehensive, coordinated, 
multidisciplinary, interagency system of early intervention services for 
infants and toddlers with disabilities and their families;
    (b) Facilitate the coordination of payment for early intervention 
services from Federal, State, local, and private sources (including 
public and private insurance coverage);

[[Page 178]]

    (c) Enhance the States' capacity to provide quality early 
intervention services and expand and improve existing early intervention 
services being provided to infants and toddlers with disabilities and 
their families; and
    (d) Enhance the capacity of State and local agencies and service 
providers to identify, evaluate, and meet the needs of historically 
underrepresented populations, particularly minority, low-income, inner-
city, and rural populations.

(Authority: 20 U.S.C. 1431)

[58 FR 40959, July 30, 1993, as amended at 63 FR 18293, Apr. 14, 1998; 
64 FR 12535, Mar. 12, 1999]



Sec. 303.2  Eligible recipients of an award.

    Eligible recipients include the 50 States, the Commonwealth of 
Puerto Rico, the District of Columbia, the Secretary of the Interior, 
and the following jurisdictions: Guam, American Samoa, the Virgin 
Islands, the Commonwealth of the Northern Mariana Islands.

(Authority: 20 U.S.C. 1401(27), 1443)

[58 FR 40959, July 30, 1993, as amended at 63 FR 18293, Apr. 14, 1998]



Sec. 303.3  Activities that may be supported under this part.

    Funds under this part may be used for the following activities:
    (a) To maintain and implement a statewide system of early 
intervention services for children eligible under this part and their 
families.
    (b) For direct services for eligible children and their families 
that are not otherwise provided from other public or private sources.
    (c) To expand and improve on services for eligible children and 
their families that are otherwise available, consistent with Sec. 
303.527.
    (d) To provide a free appropriate public education, in accordance 
with part B of the Act, to children with disabilities from their third 
birthday to the beginning of the following school year.
    (e) To strengthen the statewide system by initiating, expanding, or 
improving collaborative efforts related to at-risk infants and toddlers, 
including establishing linkages with appropriate public or private 
community-based organizations, services, and personnel for the purpose 
of--
    (1) Identifying and evaluating at-risk infants and toddlers;
    (2) Making referrals of the infants and toddlers identified and 
evaluated under paragraph (e)(1) of this section; and
    (3) Conducting periodic follow-up on each referral under paragraph 
(e)(2) of this section to determine if the status of the infant or 
toddler involved has changed with respect to the eligibility of the 
infant or toddler for services under this part.

(Authority: 20 U.S.C. 1433 and 1438)

[58 FR 40959, July 30, 1993, as amended at 63 FR 18293, Apr. 14, 1998]



Sec. 303.4  Limitation on eligible children.

    This part 303 does not apply to any child with disabilities 
receiving a free appropriate public education, in accordance with 34 CFR 
part 300, with funds received under 34 CFR part 301.

(Authority: 20 U.S.C. 1419(h))



Sec. 303.5  Applicable regulations.

    (a) The following regulations apply to this part:
    (1) The Education Department General Administrative Regulations 
(EDGAR), including--
    (i) Part 76 (State Administered Programs), except for Sec. 76.103;
    (ii) Part 77 (Definitions that Apply to Department Regulations);
    (iii) Part 79 (Intergovernmental Review of Department of Education 
Programs and Activities);
    (iv) Part 80 (Uniform Administrative Requirements for Grants and 
Cooperative Agreements to State and Local Governments);
    (v) Part 81 (Grants and Cooperative Agreements under the General 
Education Provisions Act--Enforcement);
    (vi) Part 82 (New Restrictions on Lobbying); and
    (vii) Part 85 (Governmentwide Debarment and Suspension 
(Nonprocurement) and Governmentwide Requirements for Drug-Free Work 
Place (Grants)).
    (2) The regulations in this part 303.
    (3) The following regulations in 34 CFR part 300 (Assistance to 
States for

[[Page 179]]

the Education of Children with Disabilities Program): Sec. Sec. 
300.560-300.577, and Sec. Sec. 300.580-300.585.
    (b) In applying the regulations cited in paragraphs (a)(1) and 
(a)(3) of this section, any reference to--
    (1) State educational agency means the lead agency under this part;
    (2) Special education, related services, free appropriate public 
education, free public education, or education means ``early 
intervention services'' under this part;
    (3) Participating agency, when used in reference to a local 
educational agency or an intermediate educational agency, means a local 
service provider under this part;
    (4) Section 300.128 means Sec. Sec. 303.164 and 303.321; and
    (5) Section 300.129 means Sec. 303.460.

(Authority: 20 U.S.C. 1401, 1416, 1417)

[58 FR 40959, July 30, 1993, as amended at 63 FR 18294, Apr. 14, 1998, 
64 FR 12535, Mar. 12, 1999]

                               Definitions

    Note: Sections 303.6-303.24 contain definitions, including a 
definition of ``natural environments'' in Sec. 303.18, that are used 
throughout these regulations. Other terms are defined in the specific 
subparts in which they are used. Below is a list of those terms and the 
specific sections in which they are defined:

Appropriate professional requirements in the State (Sec. 303.361(a)(1))
Assessment (Sec. 303.322(b)(2))
Consent (Sec. 303.401(a))
Evaluation (Sec. 303.322(b)(1))
Frequency and intensity (Sec. 303.344(d)(2)(i))
Highest requirements in the State applicable to a profession or 
discipline (Sec. 303.361)(a)(2))
Individualized family service plan and IFSP (Sec. 303.340(b))
Impartial (Sec. 303.421(b))
Location (Sec. 303.344(d)(3))
Method (Sec. 303.344(d)(2)(ii))
Native language (Sec. 303.401(b))
Personally identifiable (Sec. 303.401(c))
Primary referral sources (Sec. 303.321(d)(3))
Profession or discipline (Sec. 303.361(a)(3))
Special definition of ``aggregate amount'' (Sec. 303.200(b)(1))
Special definition of ``infants and toddlers'' (Sec. 303.200(b)(2))
Special definition of ``State'' (Sec. 303.200(b)(3))
State approved or recognized certification, licensing, registration, or 
other comparable requirements (Sec. 303.361(a)(4))



Sec. 303.6  Act.

    As used in this part, Act means the Individuals with Disabilities 
Education Act.

(Authority: 20 U.S.C. 1400)



Sec. 303.7  Children.

    As used in this part, children means infants and toddlers with 
disabilities as that term is defined in Sec. 303.16.

(Authority: 20 U.S.C. 1432(5))



Sec. 303.8  Council.

    As used in this part, Council means the State Interagency 
Coordinating Council.

(Authority: 20 U.S.C. 1432(2))



Sec. 303.9  Days.

    As used in this part, days means calendar days.

(Authority: 20 U.S.C. 1431-1445)



Sec. 303.10  Developmental delay.

    As used in this part, ``developmental delay,'' when used with 
respect to an individual residing in a State, has the meaning given to 
that term under Sec. 303.300.

(Authority: 20 U.S.C. 1432(3))

[64 FR 12535, Mar. 12, 1999]



Sec. 303.11  Early intervention program.

    As used in this part, early intervention program means the total 
effort in a State that is directed at meeting the needs of children 
eligible under this part and their families.

(Authority: 20 U.S.C. 1431-1445)



Sec. 303.12  Early intervention services.

    (a) General. As used in this part, early intervention services means 
services that--
    (1) Are designed to meet the developmental needs of each child 
eligible under this part and the needs of the family related to 
enhancing the child's development;
    (2) Are selected in collaboration with the parents;
    (3) Are provided--
    (i) Under public supervision;

[[Page 180]]

    (ii) By qualified personnel, as defined in Sec. 303.21, including 
the types of personnel listed in paragraph (e) of this section;
    (iii) In conformity with an individualized family service plan; and
    (iv) At no cost, unless, subject to Sec. 303.520(b)(3), Federal or 
State law provides for a system of payments by families, including a 
schedule of sliding fees; and
    (4) Meet the standards of the State, including the requirements of 
this part.
    (b) Natural environments. To the maximum extent appropriate to the 
needs of the child, early intervention services must be provided in 
natural environments, including the home and community settings in which 
children without disabilities participate.
    (c) General role of service providers. To the extent appropriate, 
service providers in each area of early intervention services included 
in paragraph (d) of this section are responsible for--
    (1) Consulting with parents, other service providers, and 
representatives of appropriate community agencies to ensure the 
effective provision of services in that area;
    (2) Training parents and others regarding the provision of those 
services; and
    (3) Participating in the multidisciplinary team's assessment of a 
child and the child's family, and in the development of integrated goals 
and outcomes for the individualized family service plan.
    (d) Types of services; definitions. Following are types of services 
included under ``early intervention services,'' and, if appropriate, 
definitions of those services:
    (1) Assistive technology device means any item, piece of equipment, 
or product system, whether acquired commercially off the shelf, 
modified, or customized, that is used to increase, maintain, or improve 
the functional capabilities of children with disabilities. Assistive 
technology service means a service that directly assists a child with a 
disability in the selection, acquisition, or use of an assistive 
technology device. Assistive technology services include--
    (i) The evaluation of the needs of a child with a disability, 
including a functional evaluation of the child in the child's customary 
environment;
    (ii) Purchasing, leasing, or otherwise providing for the acquisition 
of assistive technology devices by children with disabilities;
    (iii) Selecting, designing, fitting, customizing, adapting, 
applying, maintaining, repairing, or replacing assistive technology 
devices;
    (iv) Coordinating and using other therapies, interventions, or 
services with assistive technology devices, such as those associated 
with existing education and rehabilitation plans and programs;
    (v) Training or technical assistance for a child with disabilities 
or, if appropriate, that child's family; and
    (vi) Training or technical assistance for professionals (including 
individuals providing early intervention services) or other individuals 
who provide services to or are otherwise substantially involved in the 
major life functions of individuals with disabilities.
    (2) Audiology includes--
    (i) Identification of children with auditory impairment, using at 
risk criteria and appropriate audiologic screening techniques;
    (ii) Determination of the range, nature, and degree of hearing loss 
and communication functions, by use of audiological evaluation 
procedures;
    (iii) Referral for medical and other services necessary for the 
habilitation or rehabilitation of children with auditory impairment;
    (iv) Provision of auditory training, aural rehabilitation, speech 
reading and listening device orientation and training, and other 
services;
    (v) Provision of services for prevention of hearing loss; and
    (vi) Determination of the child's need for individual amplification, 
including selecting, fitting, and dispensing appropriate listening and 
vibrotactile devices, and evaluating the effectiveness of those devices.
    (3) Family training, counseling, and home visits means services 
provided, as appropriate, by social workers, psychologists, and other 
qualified personnel to assist the family of a child eligible under this 
part in understanding

[[Page 181]]

the special needs of the child and enhancing the child's development.
    (4) Health services (See Sec. 303.13).
    (5) Medical services only for diagnostic or evaluation purposes 
means services provided by a licensed physician to determine a child's 
developmental status and need for early intervention services.
    (6) Nursing services includes--
    (i) The assessment of health status for the purpose of providing 
nursing care, including the identification of patterns of human response 
to actual or potential health problems;
    (ii) Provision of nursing care to prevent health problems, restore 
or improve functioning, and promote optimal health and development; and
    (iii) Administration of medications, treatments, and regimens 
prescribed by a licensed physician.
    (7) Nutrition services includes--
    (i) Conducting individual assessments in--
    (A) Nutritional history and dietary intake;
    (B) Anthropometric, biochemical, and clinical variables;
    (C) Feeding skills and feeding problems; and
    (D) Food habits and food preferences;
    (ii) Developing and monitoring appropriate plans to address the 
nutritional needs of children eligible under this part, based on the 
findings in paragraph (d)(7)(i) of this section; and
    (iii) Making referrals to appropriate community resources to carry 
out nutrition goals.
    (8) Occupational therapy includes services to address the functional 
needs of a child related to adaptive development, adaptive behavior and 
play, and sensory, motor, and postural development. These services are 
designed to improve the child's functional ability to perform tasks in 
home, school, and community settings, and include--
    (i) Identification, assessment, and intervention;
    (ii) Adaptation of the environment, and selection, design, and 
fabrication of assistive and orthotic devices to facilitate development 
and promote the acquisition of functional skills; and
    (iii) Prevention or minimization of the impact of initial or future 
impairment, delay in development, or loss of functional ability.
    (9) Physical therapy includes services to address the promotion of 
sensorimotor function through enhancement of musculoskeletal status, 
neurobehavioral organization, perceptual and motor development, 
cardiopulmonary status, and effective environmental adaptation. These 
services include--
    (i) Screening, evaluation, and assessment of infants and toddlers to 
identify movement dysfunction;
    (ii) Obtaining, interpreting, and integrating information 
appropriate to program planning to prevent, alleviate, or compensate for 
movement dysfunction and related functional problems; and
    (iii) Providing individual and group services or treatment to 
prevent, alleviate, or compensate for movement dysfunction and related 
functional problems.
    (10) Psychological services includes--
    (i) Administering psychological and developmental tests and other 
assessment procedures;
    (ii) Interpreting assessment results;
    (iii) Obtaining, integrating, and interpreting information about 
child behavior, and child and family conditions related to learning, 
mental health, and development; and
    (iv) Planning and managing a program of psychological services, 
including psychological counseling for children and parents, family 
counseling, consultation on child development, parent training, and 
education programs.
    (11) Service coordination services means assistance and services 
provided by a service coordinator to a child eligible under this part 
and the child's family that are in addition to the functions and 
activities included under Sec. 303.23.
    (12) Social work services includes--
    (i) Making home visits to evaluate a child's living conditions and 
patterns of parent-child interaction;
    (ii) Preparing a social or emotional developmental assessment of the 
child within the family context;
    (iii) Providing individual and family-group counseling with parents 
and other family members, and appropriate social skill-building 
activities with the child and parents;

[[Page 182]]

    (iv) Working with those problems in a child's and family's living 
situation (home, community, and any center where early intervention 
services are provided) that affect the child's maximum utilization of 
early intervention services; and
    (v) Identifying, mobilizing, and coordinating community resources 
and services to enable the child and family to receive maximum benefit 
from early intervention services.
    (13) Special instruction includes--
    (i) The design of learning environments and activities that promote 
the child's acquisition of skills in a variety of developmental areas, 
including cognitive processes and social interaction;
    (ii) Curriculum planning, including the planned interaction of 
personnel, materials, and time and space, that leads to achieving the 
outcomes in the child's individualized family service plan;
    (iii) Providing families with information, skills, and support 
related to enhancing the skill development of the child; and
    (iv) Working with the child to enhance the child's development.
    (14) Speech-language pathology includes--
    (i) Identification of children with communicative or oropharyngeal 
disorders and delays in development of communication skills, including 
the diagnosis and appraisal of specific disorders and delays in those 
skills;
    (ii) Referral for medical or other professional services necessary 
for the habilitation or rehabilitation of children with communicative or 
oropharyngeal disorders and delays in development of communication 
skills; and
    (iii) Provision of services for the habilitation, rehabilitation, or 
prevention of communicative or oropharyngeal disorders and delays in 
development of communication skills.
    (15) Transportation and related costs includes the cost of travel 
(e.g., mileage, or travel by taxi, common carrier, or other means) and 
other costs (e.g., tolls and parking expenses) that are necessary to 
enable a child eligible under this part and the child's family to 
receive early intervention services.
    (16) Vision services means--
    (i) Evaluation and assessment of visual functioning, including the 
diagnosis and appraisal of specific visual disorders, delays, and 
abilities;
    (ii) Referral for medical or other professional services necessary 
for the habilitation or rehabilitation of visual functioning disorders, 
or both; and
    (iii) Communication skills training, orientation and mobility 
training for all environments, visual training, independent living 
skills training, and additional training necessary to activate visual 
motor abilities.
    (e) Qualified personnel. Early intervention services must be 
provided by qualified personnel, including--
    (1) Audiologists;
    (2) Family therapists;
    (3) Nurses;
    (4) Nutritionists;
    (5) Occupational therapists;
    (6) Orientation and mobility specialists;
    (7) Pediatricians and other physicians;
    (8) Physical therapists;
    (9) Psychologists;
    (10) Social workers;
    (11) Special educators; and
    (12) Speech and language pathologists.

(Authority: 20 U.S.C. 1401(1) and (2); 1432(4))
    Note: The lists of services in paragraph (d) and qualified personnel 
in paragraph (e) of this section are not exhaustive. Early intervention 
services may include such services as the provision of respite and other 
family support services. Qualified personnel may include such personnel 
as vision specialists, paraprofessionals, and parent-to-parent support 
personnel.

[58 FR 40959, July 30, 1993, as amended at 63 FR 18294, Apr. 14, 1998; 
64 FR 12535, Mar. 12, 1999]



Sec. 303.13  Health services.

    (a) As used in this part, health services means services necessary 
to enable a child to benefit from the other early intervention services 
under this part during the time that the child is receiving the other 
early intervention services.
    (b) The term includes--
    (1) Such services as clean intermittent catheterization, 
tracheostomy care, tube feeding, the changing of dressings or colostomy 
collection bags, and other health services; and

[[Page 183]]

    (2) Consultation by physicians with other service providers 
concerning the special health care needs of eligible children that will 
need to be addressed in the course of providing other early intervention 
services.
    (c) The term does not include the following:
    (1) Services that are--
    (i) Surgical in nature (such as cleft palate surgery, surgery for 
club foot, or the shunting of hydrocephalus); or
    (ii) Purely medical in nature (such as hospitalization for 
management of congenital heart ailments, or the prescribing of medicine 
or drugs for any purpose).
    (2) Devices necessary to control or treat a medical condition.
    (3) Medical-health services (such as immunizations and regular 
``well-baby'' care) that are routinely recommended for all children.

(Authority: 20 U.S.C. 1432(4))
    Note: The definition in this section distinguishes between the 
health services that are required under this part and the medical-health 
services that are not required. The IFSP requirements in subpart D of 
this part provide that, to the extent appropriate, these other medical-
health services are to be included in the IFSP, along with the funding 
sources to be used in paying for the services or the steps that will be 
taken to secure the services through public or private sources. 
Identifying these services in the IFSP does not impose an obligation to 
provide the services if they are otherwise not required to be provided 
under this part. (See Sec. 303.344(e) and the note 3 following that 
section.)



Sec. 303.14  IFSP.

    As used in this part, IFSP means the individualized family service 
plan, as that term is defined in Sec. 303.340(b).

(Authority: 20 U.S.C. 1436)



Sec. 303.15  Include; including.

    As used in this part, include or including means that the items 
named are not all of the possible items that are covered whether like or 
unlike the ones named.

(Authority: 20 U.S.C. 1431-1445)



Sec. 303.16  Infants and toddlers with disabilities.

    (a) As used in this part, infants and toddlers with disabilities 
means individuals from birth through age two who need early intervention 
services because they--
    (1) Are experiencing developmental delays, as measured by 
appropriate diagnostic instruments and procedures, in one or more of the 
following areas:
    (i) Cognitive development.
    (ii) Physical development, including vision and hearing.
    (iii) Communication development.
    (iv) Social or emotional development.
    (v) Adaptive development; or
    (2) Have a diagnosed physical or mental condition that has a high 
probability of resulting in developmental delay.
    (b) The term may also include, at a State's discretion, children 
from birth through age two who are at risk of having substantial 
developmental delays if early intervention services are not provided.

(Authority: 20 U.S.C. 1432(5))
    Note 1: The phrase ``a diagnosed physical or mental condition that 
has a high probability of resulting in developmental delay,'' as used in 
paragraph (a)(2) of this section, applies to a condition if it typically 
results in developmental delay. Examples of these conditions include 
chromosomal abnormalities; genetic or congenital disorders; severe 
sensory impairments, including hearing and vision; inborn errors of 
metabolism; disorders reflecting disturbance of the development of the 
nervous system; congenital infections; disorders secondary to exposure 
to toxic substances, including fetal alcohol syndrome; and severe 
attachment disorders.
    Note 2: With respect to paragraph (b) of this section, children who 
are at risk may be eligible under this part if a State elects to extend 
services to that population, even though they have not been identified 
as disabled.
    Under this provision, States have the authority to define who would 
be ``at risk of having substantial developmental delays if early 
intervention services are not provided.'' In defining the ``at risk'' 
population, States may include well-known biological and environmental 
factors that can be identified and that place infants and toddlers ``at 
risk'' for developmental delay. Commonly cited factors include low birth 
weight, respiratory distress as a newborn, lack of oxygen, brain 
hemorrhage, infection, nutritional deprivation, and a history of abuse 
or neglect. It should be noted that ``at risk'' factors do not predict 
the presence of a barrier to development, but they may indicate children 
who are at higher risk of developmental delay than children without 
these problems.

[[Page 184]]



Sec. 303.17  Multidisciplinary.

    As used in this part, multidisciplinary means the involvement of two 
or more disciplines or professions in the provision of integrated and 
coordinated services, including evaluation and assessment activities in 
Sec. 303.322 and development of the IFSP in Sec. 303.342.

(Authority: 20 U.S.C. 1435(a)(3), 1436(a))



Sec. 303.18  Natural environments.

    As used in this part, natural environments means settings that are 
natural or normal for the child's age peers who have no disabilities.

(Authority: 20 U.S.C. 1435 and 1436)

[63 FR 18294, Apr. 14, 1998]



Sec. 303.19  Parent.

    (a) General. As used in this part, ``parent'' means--
    (1) A natural or adoptive parent of a child;
    (2) A guardian;
    (3) A person acting in the place of a parent (such as a grandparent 
or stepparent with whom the child lives, or a person who is legally 
responsible for the child's welfare); or
    (4) A surrogate parent who has been assigned in accordance with 
Sec. 303.406.
    (b) Foster parent. Unless State law prohibits a foster parent from 
acting as a parent, a State may allow a foster parent to act as a parent 
under Part C of the Act if--
    (1) The natural parents' authority to make the decisions required of 
parents under the Act has been extinguished under State law; and
    (2) The foster parent--
    (i) Has an ongoing, long-term parental relationship with the child;
    (ii) Is willing to make the decisions required of parents under the 
Act; and
    (iii) Has no interest that would conflict with the interests of the 
child.

(Authority: 20 U.S.C. 1401(19), 1431-1445)

[64 FR 12535, Mar. 12, 1999]



Sec. 303.20  Policies.

    (a) As used in this part, policies means State statutes, 
regulations, Governor's orders, directives by the lead agency, or other 
written documents that represent the State's position concerning any 
matter covered under this part.
    (b) State policies include--
    (1) A State's commitment to maintain the statewide system (see Sec. 
303.140);
    (2) A State's eligibility criteria and procedures (see Sec. 
303.300);
    (3) A statement that, consistent with Sec. 303.520(b), provides 
that services under this part will be provided at no cost to parents, 
except where a system of payments is provided for under Federal or State 
law.
    (4) A State's standards for personnel who provide services to 
children eligible under this part (see Sec. 303.361);
    (5) A State's position and procedures related to contracting or 
making other arrangements with service providers under subpart F of this 
part; and
    (6) Other positions that the State has adopted related to 
implementing any of the other requirements under this part.

(Authority: 20 U.S.C. 1431-1445)

[58 FR 40959, July 30, 1993. Redesignated and amended at 63 FR 18294, 
Apr. 14, 1998]



Sec. 303.21  Public agency.

    As used in this part, public agency includes the lead agency and any 
other political subdivision of the State that is responsible for 
providing early intervention services to children eligible under this 
part and their families.

(Authority: 20 U.S.C. 1431-1445)

[58 FR 40959, July 30, 1993. Redesignated at 63 FR 18294, Apr. 14, 1998]



Sec. 303.22  Qualified.

    As used in this part, qualified means that a person has met State 
approved or recognized certification, licensing, registration, or other 
comparable requirements that apply to the area in which the person is 
providing early intervention services.

(Authority: 20 U.S.C. 1432(4))
    Note: These regulations contain the following provisions relating to 
a State's responsibility to ensure that personnel are qualified to 
provide early intervention services:

[[Page 185]]

    1. Section 303.12(a)(4) provides that early intervention services 
must meet State standards. This provision implements a requirement that 
is similar to a longstanding provision under part B of the Act (i.e., 
that the State educational agency establish standards and ensure that 
those standards are currently met for all programs providing special 
education and related services).
    2. Section 303.12(a)(3)(ii) provides that early intervention 
services must be provided by qualified personnel.
    3. Section 303.361(b) requires statewide systems to have policies 
and procedures relating to personnel standards.

[58 FR 40959, July 30, 1993. Redesignated at 63 FR 18294, Apr. 14, 1998]



Sec. 303.23  Service coordination (case management).

    (a) General. (1) As used in this part, except in Sec. 
303.12(d)(11), service coordination means the activities carried out by 
a service coordinator to assist and enable a child eligible under this 
part and the child's family to receive the rights, procedural 
safeguards, and services that are authorized to be provided under the 
State's early intervention program.
    (2) Each child eligible under this part and the child's family must 
be provided with one service coordinator who is responsible for--
    (i) Coordinating all services across agency lines; and
    (ii) Serving as the single point of contact in helping parents to 
obtain the services and assistance they need.
    (3) Service coordination is an active, ongoing process that 
involves--
    (i) Assisting parents of eligible children in gaining access to the 
early intervention services and other services identified in the 
individualized family service plan;
    (ii) Coordinating the provision of early intervention services and 
other services (such as medical services for other than diagnostic and 
evaluation purposes) that the child needs or is being provided;
    (iii) Facilitating the timely delivery of available services; and
    (iv) Continuously seeking the appropriate services and situations 
necessary to benefit the development of each child being served for the 
duration of the child's eligibility.
    (b) Specific service coordination activities. Service coordination 
activities include--
    (1) Coordinating the performance of evaluations and assessments;
    (2) Facilitating and participating in the development, review, and 
evaluation of individualized family service plans;
    (3) Assisting families in identifying available service providers;
    (4) Coordinating and monitoring the delivery of available services;
    (5) Informing families of the availability of advocacy services;
    (6) Coordinating with medical and health providers; and
    (7) Facilitating the development of a transition plan to preschool 
services, if appropriate.
    (c) Employment and assignment of service coordinators. (1) Service 
coordinators may be employed or assigned in any way that is permitted 
under State law, so long as it is consistent with the requirements of 
this part.
    (2) A State's policies and procedures for implementing the statewide 
system of early intervention services must be designed and implemented 
to ensure that service coordinators are able to effectively carry out on 
an interagency basis the functions and services listed under paragraphs 
(a) and (b) of this section.
    (d) Qualifications of service coordinators. Service coordinators 
must be persons who, consistent with Sec. 303.344(g), have demonstrated 
knowledge and understanding about--
    (1) Infants and toddlers who are eligible under this part;
    (2) Part C of the Act and the regulations in this part; and
    (3) The nature and scope of services available under the State's 
early intervention program, the system of payments for services in the 
State, and other pertinent information.

(Authority: 20 U.S.C. 1432(4))
    Note 1: If States have existing service coordination systems, the 
States may use or adapt those systems, so long as they are consistent 
with the requirements of this part.
    Note 2: The legislative history of the 1991 amendments to the Act 
indicates that the use of the term ``service coordination'' was not 
intended to affect the authority to seek reimbursement for services 
provided under Medicaid or any other legislation that makes

[[Page 186]]

reference to ``case management'' services. See H.R. Rep. No. 198, 102d 
Cong., 1st Sess. 12 (1991); S. Rep. No. 84, 102d Cong., 1st Sess. 20 
(1991).

[58 FR 40959, July 30, 1993. Redesignated at 63 FR 18294, Apr. 14, 1998]



Sec. 303.24  State.

    Except as provided in Sec. 303.200(b)(3), State means each of the 
50 States, the Commonwealth of Puerto Rico, the District of Columbia, 
and the jurisdictions of Guam, American Samoa, the Virgin Islands, the 
Commonwealth of the Northern Mariana Islands.

(Authority: 20 U.S.C. 1401(27))

[58 FR 40959, July 30, 1993. Redesignated and amended at 63 FR 18294, 
Apr. 14, 1998]



Sec. 303.25  EDGAR definitions that apply.

    The following terms used in this part are defined in 34 CFR 77.1:
    Applicant
    Award
    Contract
    Department
    EDGAR
    Fiscal year
    Grant
    Grantee
    Grant period
    Private
    Public
    Secretary

(Authority: 20 U.S.C. 1431-1445)

[58 FR 40959, July 30, 1993. Redesignated at 63 FR 18294, Apr. 14, 1998]



                 Subpart B_State Application for a Grant

                          General Requirements



Sec. 303.100  Conditions of assistance.

    (a) In order to receive funds under this part for any fiscal year, a 
State must have--
    (1) An approved application that contains the information required 
in this part, including--
    (i) The information required in Sec. Sec. 303.140 through 303.148; 
and
    (ii) The information required in Sec. Sec. 303.161 through 303.176; 
and
    (2) The statement of assurances required under Sec. Sec. 303.120 
through 303.128, on file with the Secretary.
    (b) If a State has on file with the Secretary a policy, procedure, 
or assurance that demonstrates that the State meets an application 
requirement, including any policy or procedure filed under this part 
before July 1, 1998, that meets such a requirement, the Secretary 
considers the State to have met that requirement for purposes of 
receiving a grant under this part.
    (c) An application that meets the requirements of this part remains 
in zeffect until the State submits to the Secretary modifications of 
that application.
    (d) The Secretary may require a State to modify its application 
under this part to the extent necessary to ensure the State's compliance 
with this part if--
    (1) An amendment is made to the Act, or to a regulation under this 
part;
    (2) A new interpretation is made of the Act by a Federal court or 
the State's highest court; or
    (3) An official finding of noncompliance with Federal law or 
regulations is made with respect to the State.

(Authority: 20 U.S.C. 1434 and 1437)

[63 FR 18294, Apr. 14, 1998, as amended at 64 FR 12535, Mar. 12, 1999]



Sec. 303.101  How the Secretary disapproves a State's application or 
statement of assurances.

    The Secretary follows the procedures in 34 CFR 300.581 through 
300.586 before disapproving a State's application or statement of 
assurances submitted under this part.

(Authority: 20 U.S.C. 1437)

                          Public Participation



Sec. 303.110  General requirements and timelines for public participation.

    (a) Before submitting to the Secretary its application under this 
part, and before adopting a new or revised policy that is not in its 
current application, a State shall--
    (1) Publish the application or policy in a manner that will ensure 
circulation throughout the State for at least a 60-day period, with an 
opportunity for comment on the application or policy for at least 30 
days during that period;

[[Page 187]]

    (2) Hold public hearings on the application or policy during the 60-
day period required in paragraph (a)(1) of this section; and
    (3) Provide adequate notice of the hearings required in paragraph 
(a)(2) of this section at least 30 days before the dates that the 
hearings are conducted.
    (b) A State may request the Secretary to waive compliance with the 
timelines in paragraph (a) of this section. The Secretary grants the 
request if the State demonstrates that--
    (1) There are circumstances that would warrant such an exception; 
and
    (2) The timelines that will be followed provide an adequate 
opportunity for public participation and comment.

(Authority: 20 U.S.C. 1437(a)(3))



Sec. 303.111  Notice of public hearings and opportunity to comment.

    The notice required in Sec. 303.110(a)(3) must--
    (a) Be published in newspapers or announced in other media, or both, 
with coverage adequate to notify the general public, including 
individuals with disabilities and parents of infants and toddlers with 
disabilities, throughout the State about the hearings and opportunity to 
comment on the application or policy; and
    (b) Be in sufficient detail to inform the public about--
    (1) The purpose and scope of the State application or policy, and 
its relationship to part C of the Act;
    (2) The length of the comment period and the date, time, and 
location of each hearing; and
    (3) The procedures for providing oral comments or submitting written 
comments.

(Authority: 20 U.S.C. 1437(a)(7))

[58 FR 40959, July 30, 1993, as amended at 63 FR 18294, Apr. 14, 1998]



Sec. 303.112  Public hearings.

    Each State shall hold public hearings in a sufficient number and at 
times and places that afford interested parties throughout the State a 
reasonable opportunity to participate.

(Authority: 20 U.S.C. 1437(a)(7))



Sec. 303.113  Reviewing public comments received.

    (a) Review of comments. Before adopting its application, and before 
the adoption of a new or revised policy not in the application, the lead 
agency shall--
    (1) Review and consider all public comments; and
    (2) Make any modifications it deems necessary in the application or 
policy.
    (b) Submission to the Secretary. In submitting the State's 
application or policy to the Secretary, the lead agency shall include 
copies of news releases, advertisements, and announcements used to 
provide notice to the general public, including individuals with 
disabilities and parents of infants and toddlers with disabilities.

(Authority: 20 U.S.C. 1437(a)(7))

[58 FR 40959, July 30, 1993, as amended at 63 FR 18294, Apr. 14, 1998]

                         Statement of Assurances



Sec. 303.120  General.

    (a) A State's statement of assurances must contain the information 
required in Sec. Sec. 303.121 through 303.128.
    (b) Unless otherwise required by the Secretary, the statement is 
submitted only once, and remains in effect throughout the term of a 
State's participation under this part.
    (c) A State may submit a revised statement of assurances if the 
statement is consistent with the requirements in Sec. Sec. 303.121 
through 303.128.

(Authority: 20 U.S.C. 1437(b))



Sec. 303.121  Reports and records.

    The statement must provide for--
    (a) Making reports in such form and containing such information as 
the Secretary may require; and
    (b) Keeping such records and affording such access to those records 
as the Secretary may find necessary to assure compliance with the 
requirements of this part, the correctness and verification of reports, 
and the proper disbursement of funds provided under this part.

(Approved by the Office of Management and Budget under control number 
1820-0550)

(Authority: 20 U.S.C. 1437(b)(4))

[[Page 188]]



Sec. 303.122  Control of funds and property.

    The statement must provide assurance satisfactory to the Secretary 
that--
    (a) The control of funds provided under this part, and title to 
property acquired with those funds, will be in a public agency for the 
uses and purposes provided in this part; and
    (b) A public agency will administer the funds and property.

(Approved by the Office of Management and Budget under control number 
1820-0550)

(Authority: 20 U.S.C. 1437(b)(3))



Sec. 303.123  Prohibition against commingling.

    The statement must include an assurance satisfactory to the 
Secretary that funds made available under this part will not be 
commingled with State funds.

(Approved by the Office of Management and Budget under control number 
1820-0550)

(Authority: 20 U.S.C. 1437(b)(5)(A))
    Note: As used in this part, commingle means depositing or recording 
funds in a general account without the ability to identify each specific 
source of funds for any expenditure. Under that general definition, it 
is clear that commingling is prohibited. However, to the extent that the 
funds from each of a series of Federal, State, local, and private 
funding sources can be identified--with a clear audit trail for each 
source--it is appropriate for those funds to be consolidated for 
carrying out a common purpose. In fact, a State may find it essential to 
set out a funding plan that incorporates, and accounts for, all sources 
of funds that can be targeted on a given activity or function related to 
the State's early intervention program.
    Thus, the assurance in this section is satisfied by the use of an 
accounting system that includes an ``audit trail'' of the expenditure of 
funds awarded under this part. Separate bank accounts are not required.



Sec. 303.124  Prohibition against supplanting.

    (a) The statement must include an assurance satisfactory to the 
Secretary that Federal funds made available under this part will be used 
to supplement the level of State and local funds expended for children 
eligible under this part and their families and in no case to supplant 
those State and local funds.
    (b) To meet the requirement in paragraph (a) of this section, the 
total amount of State and local funds budgeted for expenditures in the 
current fiscal year for early intervention services for children 
eligible under this part and their families must be at least equal to 
the total amount of State and local funds actually expended for early 
intervention services for these children and their families in the most 
recent preceding fiscal year for which the information is available. 
Allowance may be made for--
    (1) Decreases in the number of children who are eligible to receive 
early intervention services under this part; and
    (2) Unusually large amounts of funds expended for such long-term 
purposes as the acquisition of equipment and the construction of 
facilities.

(Approved by the Office of Management and Budget under control number 
1820-0550)

(Authority: 20 U.S.C. 1437(b)(5)(B))

[58 FR 40959, July 30, 1993, as amended at 63 FR 18294, Apr. 14, 1998]



Sec. 303.125  Fiscal control.

    The statement must provide assurance satisfactory to the Secretary 
that such fiscal control and fund accounting procedures will be adopted 
as may be necessary to assure proper disbursement of, and accounting 
for, Federal funds paid under this part.

(Approved by the Office of Management and Budget under control number 
1820-0550)

(Authority: 20 U.S.C. 1437(b)(6))



Sec. 303.126  Payor of last resort.

    The statement must include an assurance satisfactory to the 
Secretary that the State will comply with the provisions in Sec. 
303.527, including the requirements on--
    (a) Nonsubstitution of funds; and
    (b) Non-reduction of other benefits.

(Approved by the Office of Management and Budget under control number 
1820-0550)

(Authority: 20 U.S.C. 1437(b)(2))

[[Page 189]]



Sec. 303.127  Assurance regarding expenditure of funds.

    The statement must include an assurance satisfactory to the 
Secretary that the funds paid to the State under this part will be 
expended in accordance with the provisions of this part, including the 
requirements in Sec. 303.3.

(Approved by the Office of Management and Budget under control number 
1820-0550)

(Authority: 20 U.S.C. 1437(b)(1))



Sec. 303.128  Traditionally underserved groups.

    The statement must include an assurance satisfactory to the 
Secretary that policies and practices have been adopted to ensure--
    (a) That traditionally underserved groups, including minority, low-
income, and rural families, are meaningfully involved in the planning 
and implementation of all the requirements of this part; and
    (b) That these families have access to culturally competent services 
within their local geographical areas.

(Approved by the Office of Management and Budget under control number 
1820-0550)

(Authority: 20 U.S.C. 1437(b)(7))

              General Requirements for a State Application



Sec. 303.140  General.

    A State's application under this part must contain information and 
assurances demonstrating to the satisfaction of the Secretary that--
    (a) The statewide system of early intervention services required in 
this part is in effect; and
    (b) A State policy is in effect that ensures that appropriate early 
intervention services are available to all infants and toddlers with 
disabilities in the State and their families, including Indian infants 
and toddlers with disabilities and their families residing on a 
reservation geographically located in the State.

(Authority: 20 U.S.C. 1434 and 1435(a)(2))

[63 FR 18294, Apr. 14, 1998, as amended at 64 FR 12535, Mar. 12, 1999]



Sec. 303.141  Information about the Council.

    Each application must include information demonstrating that the 
State has established a State Interagency Coordinating Council that 
meets the requirements of subpart G of this part.

(Approved by the Office of Management and Budget under control number 
1820-0550)

(Authority: 20 U.S.C. 1437(a)(3))



Sec. 303.142  Designation of lead agency.

    Each application must include a designation of the lead agency in 
the State that will be responsible for the administration of funds 
provided under this part.

(Approved by the Office of Management and Budget under control number 
1820-0550)

(Authority: 20 U.S.C. 1437(a)(1))



Sec. 303.143  Designation regarding financial responsibility.

    Each application must include a designation by the State of an 
individual or entity responsible for assigning financial responsibility 
among appropriate agencies.

(Approved by the Office of Management and Budget under control number 
1820-0550)

(Authority: 20 U.S.C. 1437(a)(2))



Sec. 303.144  Assurance regarding use of funds.

    Each application must include an assurance that funds received under 
this part will be used to assist the State to maintain and implement the 
statewide system required under subparts D through F of this part.

(Approved by the Office of Management and Budget under control number 
1820-0550)

(Authority: 20 U.S.C. 1475, 1437(a)(3))

[58 FR 40959, July 30, 1993, as amended at 63 FR 18294, Apr. 14, 1998]



Sec. 303.145  Description of use of funds.

    (a) General. Each application must include a description of how a 
State proposes to use its funds under this part for the fiscal year or 
years covered by the application. The description must be presented 
separately for the lead agency and the Council, and include the 
information required in paragraphs (b) through (e) of this section.

[[Page 190]]

    (b) Administrative positions. Each application must include--
    (1) A list of administrative positions, with salaries, and a 
description of the duties for each person whose salary is paid in whole 
or in part with funds awarded under this part; and
    (2) For each position, the percentage of salary paid with those 
funds.
    (c) Maintenance and implementation activities. Each application must 
include--
    (1) A description of the nature and scope of each major activity to 
be carried out under this part in maintaining and implementing the 
statewide system of early intervention services; and
    (2) The approximate amount of funds to be spent for each activity.
    (d) Direct services. (1) Each application must include a description 
of any direct services that the State expects to provide to eligible 
children and their families with funds under this part, including a 
description of any services provided to at-risk infants and toddlers as 
defined in Sec. 303.16(b), and their families, consistent with 
Sec. Sec. 303.521 and 303.527.
    (2) The description must include information about each type of 
service to be provided, including--
    (i) A summary of the methods to be used to provide the service 
(e.g., contracts or other arrangements with specified public or private 
organizations); and
    (ii) The approximate amount of funds under this part to be used for 
the service.
    (e) At-risk infants and toddlers. For any State that does not 
provide direct services for at-risk infants and toddlers described in 
paragraph (d)(1) of this section, but chooses to use funds as described 
in Sec. 303.3(e), each application must include a description of how 
those funds will be used.
    (f) Activities by other agencies. If other agencies are to receive 
funds under this part, the application must include--
    (1) The name of each agency expected to receive funds;
    (2) The approximate amount of funds each agency will receive; and
    (3) A summary of the purposes for which the funds will be used.

(Approved by the Office of Management and Budget under control number 
1820-0550)

(Authority: 20 U.S.C. 1437(a)(3) and (a)(5))

[58 FR 40959, July 30, 1993, as amended at 63 FR 18294, Apr. 14, 1998; 
64 FR 12535, Mar. 12, 1999]



Sec. 303.146  Information about public participation.

    Each application must include the information on public 
participation that is required in Sec. 303.113(b).

(Approved by the Office of Management and Budget under control number 
1820-0550)

(Authority: 20 U.S.C. 1437(a)(7))



Sec. 303.147  Services to all geographic areas.

    Each application must include a description of the procedure used to 
ensure that resources are made available under this part for all 
geographic areas within the State.

(Authority: 20 U.S.C. 1437(a)(6))

[63 FR 18294, Apr. 14, 1998]



Sec. 303.148  Transition to preschool programs.

    Each application must include a description of the policies and 
procedures to be used to ensure a smooth transition for children 
receiving early intervention services under this part to preschool or 
other appropriate services, including--
    (a) A description of how the families will be included in the 
transition plans;
    (b) A description of how the lead agency under this part will--
    (1) Notify the local educational agency for the area in which the 
child resides that the child will shortly reach the age of eligibility 
for preschool services under Part B of the Act, as determined in 
accordance with State law;
    (2)(i) In the case of a child who may be eligible for preschool 
services under Part B of the Act, with the approval of the family of the 
child, convene a conference among the lead agency, the

[[Page 191]]

family, and the local educational agency at least 90 days, and at the 
discretion of the parties, up to 6 months, before the child is eligible 
for the preschool services, to discuss any services that the child may 
receive; or
    (ii) In the case of a child who may not be eligible for preschool 
services under Part B of the Act, with the approval of the family, make 
reasonable efforts to convene a conference among the lead agency, the 
family, and providers of other appropriate services for children who are 
not eligible for preschool services under Part B, to discuss the 
appropriate services that the child may receive;
    (3) Review the child's program options for the period from the 
child's third birthday through the remainder of the school year; and
    (4) Establish a transition plan; and
    (c) If the State educational agency, which is responsible for 
administering preschool programs under part B of the Act, is not the 
lead agency under this part, an interagency agreement between the two 
agencies to ensure coordination on transition matters.

(Approved by the Office of Management and Budget under control number 
1820-0550)

(Authority: 20 U.S.C. 1437(a)(8))
    Note: Among the matters that should be considered in developing 
policies and procedures to ensure a smooth transition of children from 
one program to the other are the following:
     The financial responsibilities of all appropriate 
agencies.
     The responsibility for performing evaluations of 
children.
     The development and implementation of an 
individualized education program (``IEP'') or an individualized family 
service plan (``IFSP'') for each child, consistent with the requirements 
of law (see Sec. 303.344(h) and sections 612(a)(9) of the Act).
     The coordination of communication between 
agencies and the child's family.
     The mechanisms to ensure the uninterrupted 
provision of appropriate services to the child.

[58 FR 40959, July 30, 1993, as amended at 63 FR 18294, Apr. 14, 1998]

       Components of a Statewide System--Application Requirements



Sec. 303.160  Minimum components of a statewide system.

    Each application must address the minimum components of a statewide 
system of coordinated, comprehensive, multidisciplinary, interagency 
programs providing appropriate early intervention services to all 
infants and toddlers with disabilities and their families, including 
Indian infants and toddlers with disabilities and their families 
residing on a reservation geographically located in the State. The 
minimum components of a statewide system are described in Sec. Sec. 
303.161 through 303.176.

(Approved by the Office of Management and Budget under control number 
1820-0550)

(Authority: 20 U.S.C. 1435(a), 1437(a)(9))

[58 FR 40959, July 30, 1993, as amended at 63 FR 18295, Apr. 14, 1998]



Sec. 303.161  State definition of developmental delay.

    Each application must include the State's definition of 
``developmental delay,'' as described in Sec. 303.300.

(Approved by the Office of Management and Budget under control number 
1820-0550)

(Authority: 20 U.S.C. 1435(a)(1))



Sec. 303.162  Central directory.

    Each application must include information and assurances 
demonstrating to the satisfaction of the Secretary that the State has 
developed a central directory of information that meets the requirements 
in Sec. 303.301.

(Approved by the Office of Management and Budget under control number 
1820-0550)

(Authority: 20 U.S.C. 1435(a)(7))



Sec. 303.163  [Reserved]



Sec. 303.164  Public awareness program.

    Each application must include information and assurances 
demonstrating to the satisfaction of the Secretary that the State has 
established a public

[[Page 192]]

awareness program that meets the requirements in Sec. 303.320.

(Approved by the Office of Management and Budget under control number 
1820-0550)

(Authority: 20 U.S.C. 1435(a)(6))



Sec. 303.165  Comprehensive child find system.

    Each application must include--
    (a) The policies and procedures required in Sec. 303.321(b);
    (b) Information demonstrating that the requirements on coordination 
in Sec. 303.321(c) are met;
    (c) The referral procedures required in Sec. 303.321(d), and 
either--
    (1) A description of how the referral sources are informed about the 
procedures; or
    (2) A copy of any memorandum or other document used by the lead 
agency to transmit the procedures to the referral sources; and
    (d) The timelines in Sec. 303.321(e).

(Approved by the Office of Management and Budget under control number 
1820-0550)

(Authority: 20 U.S.C. 1435(a)(5))



Sec. 303.166  Evaluation, assessment, and nondiscriminatory procedures.

    Each application must include information to demonstrate that the 
requirements in Sec. Sec. 303.322 and 303.323 are met.

(Approved by the Office of Management and Budget under control number 
1820-0550)

(Authority: 20 U.S.C. 1435(a)(3); 1436(a)(1), (d)(2), and (d)(3))



Sec. 303.167  Individualized family service plans.

    Each application must include--
    (a) An assurance that a current IFSP is in effect and implemented 
for each eligible child and the child's family;
    (b) Information demonstrating that--
    (1) The State's procedures for developing, reviewing, and evaluating 
IFSPs are consistent with the requirements in Sec. Sec. 303.340, 
303.342, 303.343 and 303.345; and
    (2) The content of IFSPs used in the State is consistent with the 
requirements in Sec. 303.344; and
    (c) Policies and procedures to ensure that--
    (1) To the maximum extent appropriate, early intervention services 
are provided in natural environments; and
    (2) The provision of early intervention services for any infant or 
toddler occurs in a setting other than a natural environment only if 
early intervention cannot be achieved satisfactorily for the infant or 
toddler in a natural environment.

(Approved by the Office of Management and Budget under control number 
1820-0550)

(Authority: 20 U.S.C. 1435(a)(4), 1436(d))

[58 FR 40959, July 30, 1993, as amended at 63 FR 18295, Apr. 14, 1998]



Sec. 303.168  Comprehensive system of personnel development (CSPD).

    Each application must include information to show that the 
requirements in Sec. 303.360(b) are met.

(Approved by the Office of Management and Budget under control number 
1820-0550)

(Authority: 20 U.S.C. 1435(a)(8))



Sec. 303.169  Personnel standards.

    (a) Each application must include policies and procedures that are 
consistent with the requirements in Sec. 303.361.

(Approved by the Office of Management and Budget under control number 
1820-0550)

(Authority: 20 U.S.C. 1435(a)(9))



Sec. 303.170  Procedural safeguards.

    Each application must include procedural safeguards that--
    (a) Are consistent with Sec. Sec. 303.400 through 303.406, 303.419 
through 303.425 and 303.460; and
    (b) Incorporate either--
    (1) The due process procedures in 34 CFR 300.506 through 300.512; or
    (2) The procedures that the State has developed to meet the 
requirements in Sec. Sec. 303.419, 303.420(b) and 303.421 through 
303.425.

(Approved by the Office of Management and Budget under control number 
1820-0550)

(Authority: 20 U.S.C. 1435(a)(13))

[58 FR 40959, July 30, 1993, as amended at 63 FR 18295, Apr. 14, 1998]

[[Page 193]]



Sec. 303.171  Supervision and monitoring of programs.

    Each application must include information to show that the 
requirements in Sec. 303.501 are met.

(Approved by the Office of Management and Budget under control number 
1820-0550)

(Authority: 20. U.S.C. 1435(a)(10)(A))



Sec. 303.172  Lead agency procedures for resolving complaints.

    Each application must include procedures that are consistent with 
the requirements in Sec. Sec. 303.510 through 303.512.

(Approved by the Office of Management and Budget under control number 
1820-0550)

(Authority: 20 U.S.C. 1435(a)(10))



Sec. 303.173  Policies and procedures related to financial matters.

    Each application must include--
    (a) Funding policies that meet the requirements in Sec. Sec. 
303.520 and 303.521;
    (b) Information about funding sources, as required in Sec. 303.522;
    (c) Procedures to ensure the timely delivery of services, in 
accordance with Sec. 303.525; and
    (d) A procedure related to the timely reimbursement of funds under 
this part, in accordance with Sec. Sec. 303.527(b) and 303.528.

(Approved by the Office of Management and Budget under control number 
1820-0550)

(Authority: 20 U.S.C. 1435(a)(10) (D) and (E), 1435(a)(12), 1440)



Sec. 303.174  Interagency agreements; resolution of individual disputes.

    Each application must include--
    (a) A copy of each interagency agreement that has been developed 
under Sec. 303.523; and
    (b) Information to show that the requirements in Sec. 303.524 are 
met.

(Approved by the Office of Management and Budget under control number 
1820-0550)

(Authority: 20 U.S.C. 1435(a)(10) (E) and (F)



Sec. 303.175  Policy for contracting or otherwise arranging for services.

    Each application must include a policy that meets the requirements 
in Sec. 303.526.

(Approved by the Office of Management and Budget under control number 
1820-0550)

(Authority: 20 U.S.C. 1435(a)(11))



Sec. 303.176  Data collection.

    Each application must include procedures that meet the requirements 
in Sec. 303.540.

(Approved by the Office of Management and Budget under control number 
1820-0550)

(Authority: 20 U.S.C. 1435(a)(14))

             Participation by the Secretary of the Interior



Sec. 303.180  Payments to the Secretary of the Interior for Indian tribes 
and tribal organizations.

    (a) The Secretary makes payments to the Secretary of the Interior 
for the coordination of assistance in the provision of early 
intervention services by the States to infants and toddlers with 
disabilities and their families on reservations served by elementary and 
secondary schools for Indian children operated or funded by the 
Department of the Interior.
    (b)(1) The Secretary of the Interior shall distribute payments under 
this part to tribes or tribal organizations (as defined under section 4 
of the Indian Self-Determination and Education Assistance Act), or 
combinations of those entities, in accordance with section 684(b) of the 
Act.
    (2) A tribe or tribal organization is eligible to receive a payment 
under this section if the tribe is on a reservation that is served by an 
elementary or secondary school operated or funded by the Bureau of 
Indian Affairs (``BIA'').
    (c)(1) Within 90 days after the end of each fiscal year the 
Secretary of the Interior shall provide the Secretary with a report on 
the payments distributed under this section.
    (2) The report must include--
    (i) The name of each tribe, tribal organization, or combination of 
those entities that received a payment for the fiscal year;
    (ii) The amount of each payment; and

[[Page 194]]

    (iii) The date of each payment.

(Approved by the Office of Management and Budget under control number 
1820-0550)

(Authority: 20 U.S.C. 1443(b))



            Subpart C_Procedures for Making Grants to States



Sec. 303.200  Formula for State allocations.

    (a) For each fiscal year, from the aggregate amount of funds 
available under this part for distribution to the States, the Secretary 
allots to each State an amount that bears the same ratio to the 
aggregate amount as the number of infants and toddlers in the State 
bears to the number of infants and toddlers in all States.
    (b) For the purpose of allotting funds to the States under paragraph 
(a) of this section--
    (1) Aggregate amount means the amount available for distribution to 
the States after the Secretary determines the amount of payments to be 
made to the Secretary of the Interior under Sec. 303.203 and to the 
jurisdictions under Sec. 303.204;
    (2) Infants and toddlers means children from birth through age two 
in the general population, based on the most recent satisfactory data as 
determined by the Secretary; and
    (3) State means each of the 50 States, the District of Columbia, and 
the Commonwealth of Puerto Rico.

(Authority: 20 U.S.C. 1443(c))



Sec. 303.201  Distribution of allotments from non-participating States.

    If a State elects not to receive its allotment, the Secretary 
reallots those funds among the remaining States, in accordance with 
Sec. 303.200(a).

(Authority: 20 U.S.C. 1443(d))



Sec. 303.202  Minimum grant that a State may receive.

    No State receives less than 0.5 percent of the aggregate amount 
available under Sec. 303.200 or $500,000, whichever is greater.

(Authority: 20 U.S.C. 1443(c)(2))



Sec. 303.203  Payments to the Secretary of the Interior.

    The amount of the payment to the Secretary of the Interior under 
Sec. 303.180 for any fiscal year is 1.25 percent of the aggregate 
amount available to States after the Secretary determines the amount of 
payments to be made to the jurisdictions under Sec. 303.204.

(Authority: 20 U.S.C. 1443(b))



Sec. 303.204  Payments to the jurisdictions.

    (a) From the sums appropriated to carry out this part for any fiscal 
year, the Secretary may reserve up to 1 percent for payments to the 
jurisdictions listed in Sec. 303.2 in accordance with their respective 
needs.
    (b) The provisions of Pub. L. 95-134, permitting the consolidation 
of grants to the outlying areas, do not apply to funds provided under 
paragraph (a) of this section.

(Authority: 20 U.S.C. 1443(a))

[58 FR 40959, July 30, 1993, as amended at 63 FR 18295, Apr. 14, 1998]



Subpart D_Program and Service Components of a Statewide System of Early 
                          Intervention Services

                                 General



Sec. 303.300  State eligibility criteria and procedures.

    Each statewide system of early intervention services must include 
the eligibility criteria and procedures, consistent with Sec. 303.16, 
that will be used by the State in carrying out programs under this part.
    (a) The State shall define developmental delay by--
    (1) Describing, for each of the areas listed in Sec. 303.16(a)(1), 
the procedures, including the use of informed clinical opinion, that 
will be used to measure a child's development; and
    (2) Stating the levels of functioning or other criteria that 
constitute a developmental delay in each of those areas.
    (b) The State shall describe the criteria and procedures, including 
the use of informed clinical opinion, that will

[[Page 195]]

be used to determine the existence of a condition that has a high 
probability of resulting in developmental delay under Sec. 
303.16(a)(2).
    (c) If the State elects to include in its system children who are at 
risk under Sec. 303.16(b), the State shall describe the criteria and 
procedures, including the use of informed clinical opinion, that will be 
used to identify those children.

(Approved by the Office of Management and Budget under control number 
1820-0550)

(Authority: 20 U.S.C. 1432(5), 1435(a)(1))
    Note: Under this section and Sec. 303.322(c)(2), States are 
required to ensure that informed clinical opinion is used in determining 
a child's eligibility under this part. Informed clinical opinion is 
especially important if there are no standardized measures, or if the 
standardized procedures are not appropriate for a given age or 
developmental area. If a given standardized procedure is considered to 
be appropriate, a State's criteria could include percentiles or 
percentages of levels of functioning on standardized measures.



Sec. 303.301  Central directory.

    (a) Each system must include a central directory of information 
about--
    (1) Public and private early intervention services, resources, and 
experts available in the State;
    (2) Research and demonstration projects being conducted in the 
State; and
    (3) Professional and other groups that provide assistance to 
children eligible under this part and their families.
    (b) The information required in paragraph (a) of this section must 
be in sufficient detail to--
    (1) Ensure that the general public will be able to determine the 
nature and scope of the services and assistance available from each of 
the sources listed in the directory; and
    (2) Enable the parent of a child eligible under this part to 
contact, by telephone or letter, any of the sources listed in the 
directory.
    (c) The central directory must be--
    (1) Updated at least annually; and
    (2) Accessible to the general public.
    (d) To meet the requirements in paragraph (c)(2) of this section, 
the lead agency shall arrange for copies of the directory to be 
available--
    (1) In each geographic region of the State, including rural areas; 
and
    (2) In places and a manner that ensure accessibility by persons with 
disabilities.

(Approved by the Office of Management and Budget under control number 
1820-0550)

(Authority: 20 U.S.C. 1435(a)(7))
    Note: Examples of appropriate groups that provide assistance to 
eligible children and their families include parent support groups and 
advocate associations.

                      Identification and Evaluation



Sec. 303.320  Public awareness program.

    Each system must include a public awareness program that focuses on 
the early identification of children who are eligible to receive early 
intervention services under this part and includes the preparation and 
dissemination by the lead agency to all primary referral sources, 
especially hospitals and physicians, of materials for parents on the 
availability of early intervention services. The public awareness 
program must provide for informing the public about--
    (a) The State's early intervention program;
    (b) The child find system, including--
    (1) The purpose and scope of the system;
    (2) How to make referrals; and
    (3) How to gain access to a comprehensive, multidisciplinary 
evaluation and other early intervention services; and
    (c) The central directory.

(Approved by the Office of Management and Budget under control number 
1820-0550)

(Authority: 20 U.S.C. 1435(a)(6))
    Note 1: An effective public awareness program is one that does the 
following:
    1. Provides a continuous, ongoing effort that is in effect 
throughout the State, including rural areas;
    2. Provides for the involvement of, and communication with, major 
organizations throughout the State that have a direct interest in this 
part, including public agencies at the State and local level, private 
providers, professional associations, parent groups, advocate 
associations, and other organizations;
    3. Has coverage broad enough to reach the general public, including 
those who have disabilities; and
    4. Includes a variety of methods for informing the public about the 
provisions of this part.

[[Page 196]]

    Note 2: Examples of methods for informing the general public about 
the provisions of this part include: (1) Use of television, radio, and 
newspaper releases, (2) pamphlets and posters displayed in doctors' 
offices, hospitals, and other appropriate locations, and (3) the use of 
a toll-free telephone service.

[58 FR 40959, July 30, 1993, as amended at 63 FR 18295, Apr. 14, 1998]



Sec. 303.321  Comprehensive child find system.

    (a) General. (1) Each system must include a comprehensive child find 
system that is consistent with part B of the Act (see 34 CFR 300.128), 
and meets the requirements of paragraphs (b) through (e) of this 
section.
    (2) The lead agency, with the advice and assistance of the Council, 
shall be responsible for implementing the child find system.
    (b) Procedures. The child find system must include the policies and 
procedures that the State will follow to ensure that--
    (1) All infants and toddlers in the State who are eligible for 
services under this part are identified, located, and evaluated; and
    (2) An effective method is developed and implemented to determine 
which children are receiving needed early intervention services.
    (c) Coordination. (1) The lead agency, with the assistance of the 
Council, shall ensure that the child find system under this part is 
coordinated with all other major efforts to locate and identify children 
conducted by other State agencies responsible for administering the 
various education, health, and social service programs relevant to this 
part, tribes and tribal organizations that receive payments under this 
part, and other tribes and tribal organizations as appropriate, 
including efforts in the--
    (i) Program authorized under part B of the Act;
    (ii) Maternal and Child Health program under title V of the Social 
Security Act;
    (iii) Early Periodic Screening, Diagnosis and Treatment (EPSDT) 
program under title XIX of the Social Security Act;
    (iv) Developmental Disabilities Assistance and Bill of Rights Act;
    (v) Head Start Act; and
    (vi) Supplemental Security Income program under title XVI of the 
Social Security Act.
    (2) The lead agency, with the advice and assistance of the Council, 
shall take steps to ensure that--
    (i) There will not be unnecessary duplication of effort by the 
various agencies involved in the State's child find system under this 
part; and
    (ii) The State will make use of the resources available through each 
public agency in the State to implement the child find system in an 
effective manner.
    (d) Referral procedures. (1) The child find system must include 
procedures for use by primary referral sources for referring a child to 
the appropriate public agency within the system for--
    (i) Evaluation and assessment, in accordance with Sec. Sec. 303.322 
and 303.323; or
    (ii) As appropriate, the provision of services, in accordance with 
Sec. 303.342(a) or Sec. 303.345.
    (2) The procedures required in paragraph (b)(1) of this section 
must--
    (i) Provide for an effective method of making referrals by primary 
referral sources;
    (ii) Ensure that referrals are made no more than two working days 
after a child has been identified; and
    (iii) Include procedures for determining the extent to which primary 
referral sources, especially hospitals and physicians, disseminate the 
information, as described in Sec. 303.320, prepared by the lead agency 
on the availability of early intervention services to parents of infants 
and toddlers with disabilities.
    (3) As used in paragraph (d)(1) of this section, primary referral 
sources includes--
    (i) Hospitals, including prenatal and postnatal care facilities;
    (ii) Physicians;
    (iii) Parents;
    (iv) Day care programs;
    (v) Local educational agencies;
    (vi) Public health facilities;
    (vii) Other social service agencies; and
    (viii) Other health care providers.
    (e) Timelines for public agencies to act on referrals. (1) Once the 
public agency receives a referral, it shall appoint a service 
coordinator as soon as possible.

[[Page 197]]

    (2) Within 45 days after it receives a referral, the public agency 
shall--
    (i) Complete the evaluation and assessment activities in Sec. 
303.322; and
    (ii) Hold an IFSP meeting, in accordance with Sec. 303.342.

(Approved by the Office of Management and Budget under control number 
1820-0550)

(Authority: 20 U.S.C. 1432(4)(E)(vii), 1435(a)(5))
    Note: In developing the child find system under this part, States 
should consider (1) tracking systems based on high-risk conditions at 
birth, and (2) other activities that are being conducted by various 
agencies or organizations in the State.

[58 FR 40959, July 30, 1993, as amended at 63 FR 18295, Apr. 14, 1998]



Sec. 303.322  Evaluation and assessment.

    (a) General. (1) Each system must include the performance of a 
timely, comprehensive, multidisciplinary evaluation of each child, birth 
through age two, referred for evaluation, and a family-directed 
identification of the needs of each child's family to appropriately 
assist in the development of the child.
    (2) The lead agency shall be responsible for ensuring that the 
requirements of this section are implemented by all affected public 
agencies and service providers in the State.
    (b) Definitions of evaluation and assessment. As used in this part--
    (1) Evaluation means the procedures used by appropriate qualified 
personnel to determine a child's initial and continuing eligibility 
under this part, consistent with the definition of ``infants and 
toddlers with disabilities'' in Sec. 303.16, including determining the 
status of the child in each of the developmental areas in paragraph 
(c)(3)(ii) of this section.
    (2) Assessment means the ongoing procedures used by appropriate 
qualified personnel throughout the period of a child's eligibility under 
this part to identify--
    (i) The child's unique strengths and needs and the services 
appropriate to meet those needs; and
    (ii) The resources, priorities, and concerns of the family and the 
supports and services necessary to enhance the family's capacity to meet 
the developmental needs of their infant or toddler with a disability.
    (c) Evaluation and assessment of the child. The evaluation and 
assessment of each child must--
    (1) Be conducted by personnel trained to utilize appropriate methods 
and procedures;
    (2) Be based on informed clinical opinion; and
    (3) Include the following:
    (i) A review of pertinent records related to the child's current 
health status and medical history.
    (ii) An evaluation of the child's level of functioning in each of 
the following developmental areas:
    (A) Cognitive development.
    (B) Physical development, including vision and hearing.
    (C) Communication development.
    (D) Social or emotional development.
    (E) Adaptive development.
    (iii) An assessment of the unique needs of the child in terms of 
each of the developmental areas in paragraph (c)(3)(ii) of this section, 
including the identification of services appropriate to meet those 
needs.
    (d) Family assessment. (1) Family assessments under this part must 
be family-directed and designed to determine the resources, priorities, 
and concerns of the family and the identification of the supports and 
services necessary to enhance the family's capacity to meet the 
developmental needs of the child.
    (2) Any assessment that is conducted must be voluntary on the part 
of the family.
    (3) If an assessment of the family is carried out, the assessment 
must--
    (i) Be conducted by personnel trained to utilize appropriate methods 
and procedures;
    (ii) Be based on information provided by the family through a 
personal interview; and
    (iii) Incorporate the family's description of its resources, 
priorities, and concerns related to enhancing the child's development.
    (e) Timelines. (1) Except as provided in paragraph (e)(2) of this 
section, the evaluation and initial assessment of each child (including 
the family assessment) must be completed within the 45-day time period 
required in Sec. 303.321(e).
    (2) The lead agency shall develop procedures to ensure that in the 
event of exceptional circumstances that make

[[Page 198]]

it impossible to complete the evaluation and assessment within 45 days 
(e.g., if a child is ill), public agencies will--
    (i) Document those circumstances; and
    (ii) Develop and implement an interim IFSP, to the extent 
appropriate and consistent with Sec. 303.345 (b)(1) and (b)(2).

(Approved by the Office of Management and Budget under control number 
1820-0550)

(Authority: 20 U.S.C. 1435(a)(3); 1436 (a)(1), (a)(2), (d)(1), and 
(d)(2))

[58 FR 40959, July 30, 1993, as amended at 63 FR 18295, Apr. 14, 1998]



Sec. 303.323  Nondiscriminatory procedures.

    Each lead agency shall adopt nondiscriminatory evaluation and 
assessment procedures. The procedures must provide that public agencies 
responsible for the evaluation and assessment of children and families 
under this part shall ensure, at a minimum, that--
    (a) Tests and other evaluation materials and procedures are 
administered in the native language of the parents or other mode of 
communication, unless it is clearly not feasible to do so;
    (b) Any assessment and evaluation procedures and materials that are 
used are selected and administered so as not to be racially or 
culturally discriminatory;
    (c) No single procedure is used as the sole criterion for 
determining a child's eligibility under this part; and
    (d) Evaluations and assessments are conducted by qualified 
personnel.

(Approved by the Office of Management and Budget under control number 
1820-0550)

(Authority: 20 U.S.C. 1435(a)(3); 1436 (a)(1), (d)(2), and (d)(3))

               Individualized Family Service Plans (IFSPs)



Sec. 303.340  General.

    (a) Each system must include policies and procedures regarding 
individualized family service plans (IFSPs) that meet the requirements 
of this section and Sec. Sec. 303.341 through 303.346.
    (b) As used in this part, individualized family service plan and 
IFSP mean a written plan for providing early intervention services to a 
child eligible under this part and the child's family. The plan must--
    (1) Be developed in accordance with Sec. Sec. 303.342 and 303.343;
    (2) Be based on the evaluation and assessment described in Sec. 
303.322; and
    (3) Include the matters specified in Sec. 303.344.
    (c) Lead agency responsibility. The lead agency shall ensure that an 
IFSP is developed and implemented for each eligible child, in accordance 
with the requirements of this part. If there is a dispute between 
agencies as to who has responsibility for developing or implementing an 
IFSP, the lead agency shall resolve the dispute or assign 
responsibility.

(Approved by the Office of Management and Budget under control number 
1820-0550)

(Authority: 20 U.S.C. 1436)
    Note: In instances where an eligible child must have both an IFSP 
and an individualized service plan under another Federal program, it may 
be possible to develop a single consolidated document, provided that it 
(1) contains all of the required information in Sec. 303.344, and (2) 
is developed in accordance with the requirements of this part.



Sec. 303.341  [Reserved]



Sec. 303.342  Procedures for IFSP development, review, and evaluation.

    (a) Meeting to develop initial IFSP--timelines. For a child who has 
been evaluated for the first time and determined to be eligible, a 
meeting to develop the initial IFSP must be conducted within the 45-day 
time period in Sec. 303.321(e).
    (b) Periodic review. (1) A review of the IFSP for a child and the 
child's family must be conducted every six months, or more frequently if 
conditions warrant, or if the family requests such a review. The purpose 
of the periodic review is to determine--
    (i) The degree to which progress toward achieving the outcomes is 
being made; and
    (ii) Whether modification or revision of the outcomes or services is 
necessary.
    (2) The review may be carried out by a meeting or by another means 
that is acceptable to the parents and other participants.

[[Page 199]]

    (c) Annual meeting to evaluate the IFSP. A meeting must be conducted 
on at least an annual basis to evaluate the IFSP for a child and the 
child's family, and, as appropriate, to revise its provisions. The 
results of any current evaluations conducted under Sec. 303.322(c), and 
other information available from the ongoing assessment of the child and 
family, must be used in determining what services are needed and will be 
provided.
    (d) Accessibility and convenience of meetings. (1) IFSP meetings 
must be conducted--
    (i) In settings and at times that are convenient to families; and
    (ii) In the native language of the family or other mode of 
communication used by the family, unless it is clearly not feasible to 
do so.
    (2) Meeting arrangements must be made with, and written notice 
provided to, the family and other participants early enough before the 
meeting date to ensure that they will be able to attend.
    (e) Parental consent. The contents of the IFSP must be fully 
explained to the parents and informed written consent from the parents 
must be obtained prior to the provision of early intervention services 
described in the plan. If the parents do not provide consent with 
respect to a particular early intervention service or withdraw consent 
after first providing it, that service may not be provided. The early 
intervention services to which parental consent is obtained must be 
provided.

(Approved by the Office of Management and Budget under control number 
1820-0550)

(Authority: 20 U.S.C. 1436)
    Note: The requirement for the annual evaluation incorporates the 
periodic review process. Therefore, it is necessary to have only one 
separate periodic review each year (i.e., six months after the initial 
and subsequent annual IFSP meetings), unless conditions warrant 
otherwise.

    Because the needs of infants and toddlers change so rapidly during 
the course of a year, certain evaluation procedures may need to be 
repeated before conducting the periodic reviews and annual evaluation 
meetings in paragraphs (b) and (c) of this section.



Sec. 303.343  Participants in IFSP meetings and periodic reviews.

    (a) Initial and annual IFSP meetings. (1) Each initial meeting and 
each annual meeting to evaluate the IFSP must include the following 
participants:
    (i) The parent or parents of the child.
    (ii) Other family members, as requested by the parent, if feasible 
to do so;
    (iii) An advocate or person outside of the family, if the parent 
requests that the person participate.
    (iv) The service coordinator who has been working with the family 
since the initial referral of the child for evaluation, or who has been 
designated by the public agency to be responsible for implementation of 
the IFSP.
    (v) A person or persons directly involved in conducting the 
evaluations and assessments in Sec. 303.322.
    (vi) As appropriate, persons who will be providing services to the 
child or family.
    (2) If a person listed in paragraph (a)(1)(v) of this section is 
unable to attend a meeting, arrangements must be made for the person's 
involvement through other means, including--
    (i) Participating in a telephone conference call;
    (ii) Having a knowledgeable authorized representative attend the 
meeting; or
    (iii) Making pertinent records available at the meeting.
    (b) Periodic review. Each periodic review must provide for the 
participation of persons in paragraphs (a)(1)(i) through (a)(1)(iv) of 
this section. If conditions warrant, provisions must be made for the 
participation of other representatives identified in paragraph (a) of 
this section.

(Approved by the Office of Management and Budget under control number 
1820-0550)

(Authority: 20 U.S.C. 1436(b))



Sec. 303.344  Content of an IFSP.

    (a) Information about the child's status. (1) The IFSP must include 
a statement of the child's present levels of physical development 
(including vision, hearing,

[[Page 200]]

and health status), cognitive development, communication development, 
social or emotional development, and adaptive development.
    (2) The statement in paragraph (a)(1) of this section must be based 
on professionally acceptable objective criteria.
    (b) Family information. With the concurrence of the family, the IFS 
must include a statement of the family's resources, priorities, and 
concerns related to enhancing the development of the child.
    (c) Outcomes. The IFSP must include a statement of the major 
outcomes expected to be achieved for the child and family, and the 
criteria, procedures, and timeliness used to determine--
    (1) The degree to which progress toward achieving the outcomes is 
being made; and
    (2) Whether modifications or revisions of the outcomes or services 
are necessary.
    (d) Early intervention services. (1) The IFSP must include a 
statement of the specific early intervention services necessary to meet 
the unique needs of the child and the family to achieve the outcomes 
identified in paragraph (c) of this section, including--
    (i) The frequency, intensity, and method of delivering the services;
    (ii) The natural environments, as described in Sec. 303.12(b), and 
Sec. 303.18 in which early intervention services will be provided, and 
a justification of the extent, if any, to which the services will not be 
providied in a natural environment;
    (iii) The location of the services; and
    (iv) The payment arrangements, if any.
    (2) As used in paragraph (d)(1)(i) of this section--
    (i) Frequency and intensity mean the number of days or sessions that 
a service will be provided, the length of time the service is provided 
during each session, and whether the service is provided on an 
individual or group basis; and
    (ii) Method means how a service is provided.
    (3) As used in paragraph (d)(1)(iii) of this section, location means 
the actual place or places where a service will be provided.
    (e) Other services. (1) To the extent appropriate, the IFSP must 
include--
    (i) Medical and other services that the child needs, but that are 
not required under this part; and
    (ii) The funding sources to be used in paying for those services or 
the steps that will be taken to secure those services through public or 
private sources.
    (2) The requirement in paragraph (e)(1) of this section does not 
apply to routine medical services (e.g., immunizations and ``well-baby'' 
care), unless a child needs those services and the services are not 
otherwise available or being provided.
    (f) Dates; duration of services. The IFSP must include--
    (1) The projected dates for initiation of the services in paragraph 
(d)(1) of this section as soon as possible after the IFSP meetings 
described in Sec. 303.342; and
    (2) The anticipated duration of those services.
    (g) Service coordinator. (1) The IFSP must include the name of the 
service coordinator from the profession most immediately relevant to the 
child's or family's needs (or who is otherwise qualified to carry out 
all applicable responsibilities under this part), who will be 
responsible for the implementation of the IFSP and coordination with 
other agencies and persons.
    (2) In meeting the requirements in paragraph (g)(1) of this section, 
the public agency may--
    (i) Assign the same service coordinator who was appointed at the 
time that the child was initially referred for evaluation to be 
responsible for implementing a child's and family's IFSP; or
    (ii) Appoint a new service coordinator.
    (3) As used in paragraph (g)(1) of this section, the term profession 
includes ``service coordination.''
    (h) Transition from Part C services. (1) The IFSP must include the 
steps to be taken to support the transition of the child, in accordance 
with Sec. 303.148, to--
    (i) Preschool services under Part B of the Act, to the extent that 
those services are appropriate; or
    (ii) Other services that may be available, if appropriate.
    (2) The steps required in paragraph (h)(1) of this section include--

[[Page 201]]

    (i) Discussions with, and training of, parents regarding future 
placements and other matters related to the child's transition;
    (ii) Procedures to prepare the child for changes in service 
delivery, including steps to help the child adjust to, and function in, 
a new setting; and
    (iii) With parental consent, the transmission of information about 
the child to the local educational agency, to ensure continuity of 
services, including evaluation and assessment information required in 
Sec. 303.322, and copies of IFSPs that have been developed and 
implemented in accordance with Sec. Sec. 303.340 through 303.346.

(Approved by the Office of Management and Budget under control number 
1820-0550)

(Authority: 20 U.S.C. 1436(d))
    Note 1: With respect to the requirements in paragraph (d) of this 
section, the appropriate location of services for some infants and 
toddlers might be a hospital setting--during the period in which they 
require extensive medical intervention. However, for these and other 
eligible children, early intervention services must be provided in 
natural environments (e.g., the home, child care centers, or other 
community settings) to the maximum extent appropriate to the needs of 
the child.
    Note 2: Throughout the process of developing and implementing IFSPs 
for an eligible child and the child's family, it is important for 
agencies to recognize the variety of roles that family members play in 
enhancing the child's development. It also is important that the degree 
to which the needs of the family are addressed in the IFSP process is 
determined in a collaborative manner with the full agreement and 
participation of the parents of the child. Parents retain the ultimate 
decision in determining whether they, their child, or other family 
members will accept or decline services under this part.
    Note 3: The early intervention services in paragraph (d) of this 
section are those services that a State is required to provide to a 
child in accordance with Sec. 303.12.
    The ``other services'' in paragraph (e) of this section are services 
that a child or family needs, but that are neither required nor covered 
under this part. While listing the non-required services in the IFSP 
does not mean that those services must be provided, their identification 
can be helpful to both the child's family and the service coordinator, 
for the following reasons: First, the IFSP would provide a comprehensive 
picture of the child's total service needs (including the need for 
medical and health services, as well as early intervention services). 
Second, it is appropriate for the service coordinator to assist the 
family in securing the non-required services (e.g., by (1) determining 
if there is a public agency that could provide financial assistance, if 
needed, (2) assisting in the preparation of eligibility claims or 
insurance claims, if needed, and (3) assisting the family in seeking out 
and arranging for the child to receive the needed medical-health 
services).
    Thus, to the extent appropriate, it is important for a State's 
procedures under this part to provide for ensuring that other needs of 
the child, and of the family related to enhancing the development of the 
child, such as medical and health needs, are considered and addressed, 
including determining (1) who will provide each service, and when, 
where, and how it will be provided, and (2) how the service will be paid 
for (e.g., through private insurance, an existing Federal-State funding 
source, such as Medicaid or EPSDT, or some other funding arrangement).
    Note 4: Although the IFSP must include information about each of the 
items in paragraphs (b) through (h) of this section, this does not mean 
that the IFSP must be a detailed, lengthy document. It might be a brief 
outline, with appropriate attachments that address each of the points in 
the paragraphs under this section. It is important for the IFSP itself 
to be clear about (a) what services are to be provided, (b) the actions 
that are to be taken by the service coordinator in initiating those 
services, and (c) what actions will be taken by the parents.

[58 FR 40959, July 30, 1993, as amended at 63 FR 18295, Apr. 14, 1998; 
64 FR 12536, Mar. 12, 1999]



Sec. 303.345  Provision of services before evaluation and assessment 
are completed.

    Early intervention services for an eligible child and the child's 
family may commence before the completion of the evaluation and 
assessment in Sec. 303.322, if the following conditions are met:
    (a) Parental consent is obtained.
    (b) An interim IFSP is developed that includes--
    (1) The name of the service coordinator who will be responsible, 
consistent with Sec. 303.344(g), for implementation of the interim IFSP 
and coordination with other agencies and persons; and
    (2) The early intervention services that have been determined to be 
needed immediately by the child and the child's family.

[[Page 202]]

    (c) The evaluation and assessment are completed within the time 
period required in Sec. 303.322(e).

(Approved by the Office of Management and Budget under control number 
1820-0550)

(Authority: 20 U.S.C. 1436(c))
    Note: This section is intended to accomplish two specific purposes: 
(1) To facilitate the provision of services in the event that a child 
has obvious immediate needs that are identified, even at the time of 
referral (e.g., a physician recommends that a child with cerebral palsy 
begin receiving physical therapy as soon as possible), and (2) to ensure 
that the requirements for the timely evaluation and assessment are not 
circumvented.



Sec. 303.346  Responsibility and accountability.

    Each agency or person who has a direct role in the provision of 
early intervention services is responsible for making a good faith 
effort to assist each eligible child in achieving the outcomes in the 
child's IFSP. However, part C of the Act does not require that any 
agency or person be held accountable if an eligible child does not 
achieve the growth projected in the child's IFSP.

(Approved by the Office of Management and Budget under control number 
1820-0550)

(Authority: 20 U.S.C. 1436)

                    Personnel Training and Standards



Sec. 303.360  Comprehensive system of personnel development.

    (a) Each system must include a comprehensive system of personnel 
development.
    (b) The personnel development system under this part must--
    (1) Be consistent with the comprehensive system of personnel 
development required under part B of the Act (34 CFR 300.380 through 
300.387);
    (2) Provide for preservice and inservice training to be conducted on 
an interdisciplinary basis, to the extent appropriate;
    (3) Provide for the training of a variety of personnel needed to 
meet the requirements of this part, including public and private 
providers, primary referral sources, paraprofessionals, and persons who 
will serve as service coordinators; and
    (4) Ensure that the training provided relates specifically to--
    (i) Understanding the basic components of early intervention 
services available in the State;
    (ii) Meeting the interrelated social or emotional, health, 
developmental, and educational needs of eligible children under this 
part; and
    (iii) Assisting families in enhancing the development of their 
children, and in participating fully in the development and 
implementation of IFSPs.
    (c) A personnel development system under this part may include--
    (1) Implementing innovative strategies and activities for the 
recruitment and retention of early intervention service providers;
    (2) Promoting the preparation of early intervention providers who 
are fully and appropriately qualified to provide early intervention 
services under this part;
    (3) Training personnel to work in rural and inner-city areas; and
    (4) Training personnel to coordinate transition services for infants 
and toddlers with disabilities from an early intervention program under 
this part to a preschool program under part B of the Act or to other 
preschool or other appropriate services.

(Approved by the Office of Management and Budget under control number 
1820-0550)

(Authority: 20 U.S.C. 1435(a)(8))

[58 FR 40959, July 30, 1993, as amended at 63 FR 18295, Apr. 14, 1998]



Sec. 303.361  Personnel standards.

    (a) As used in this part--
    (1) Appropriate professional requirements in the State means entry 
level requirements that--
    (i) Are based on the highest requirements in the State applicable to 
the profession or discipline in which a person is providing early 
intervention services; and
    (ii) Establish suitable qualifications for personnel providing early 
intervention services under this part to eligible children and their 
families who are served by State, local, and private agencies.
    (2) Highest requirements in the State applicable to a specific 
profession or discipline means the highest entry-level academic degree 
needed for any State

[[Page 203]]

approved or recognized certification, licensing, registration, or other 
comparable requirements that apply to that profession or discipline.
    (3) Profession or discipline means a specific occupational category 
that--
    (i) Provides early intervention services to children eligible under 
this part and their families;
    (ii) Has been established or designated by the State; and
    (iii) Has a required scope of responsibility and degree of 
supervision.
    (4) State approved or recognized certification, licensing, 
registration, or other comparable requirements means the requirements 
that a State legislature either has enacted or has authorized a State 
agency to promulgate through rules to establish the entry-level 
standards for employment in a specific profession or discipline in that 
State.
    (b)(1) Each statewide system must have policies and procedures 
relating to the establishment and maintenance of standards to ensure 
that personnel necessary to carry out the purposes of this part are 
appropriately and adequately prepared and trained.
    (2) The policies and procedures required in paragraph (b)(1) of this 
section must provide for the establishment and maintenance of standards 
that are consistent with any State-approved or State-recognized 
certification, licensing, registration, or other comparable requirements 
that apply to the profession or discipline in which a person is 
providing early intervention services.
    (c) To the extent that a State's standards for a profession or 
discipline, including standards for temporary or emergency 
certification, are not based on the highest requirements in the State 
applicable to a specific profession or discipline, the State's 
application for assistance under this part must include the steps the 
State is taking, the procedures for notifying public agencies and 
personnel of those steps, and the timelines it has established for the 
retraining or hiring of personnel that meet appropriate professional 
requirements in the State.
    (d)(1) In meeting the requirements in paragraphs (b) and (c) of this 
section, a determination must be made about the status of personnel 
standards in the State. That determination must be based on current 
information that accurately describes, for each profession or discipline 
in which personnel are providing early intervention services, whether 
the applicable standards are consistent with the highest requirements in 
the State for that profession or discipline.
    (2) The information required in paragraph (d)(1) of this section 
must be on file in the lead agency, and available to the public.
    (e) In identifying the ``highest requirements in the State'' for 
purposes of this section, the requirements of all State statutes and the 
rules of all State agencies applicable to serving children eligible 
under this part and their families must be considered.
    (f) A State may allow paraprofessionals and assistants who are 
appropriately trained and supervised, in accordance with State law, 
regulations, or written policy, to assist in the provision of early 
intervention services to eligible children under this part.
    (g) In implementing this section, a State may adopt a policy that 
includes making ongoing good-faith efforts to recruit and hire 
appropriately and adequately trained personnel to provide early 
intervention services to eligible children, including, in a geographic 
area of the State where there is a shortage of personnel that meet these 
qualifications, the most qualified individuals available who are making 
satisfactory progress toward completing applicable course work necessary 
to meet the standards described in paragraph (b)(2) of this section, 
consistent with State law, within 3 years.

(Approved by the Office of Management and Budget under control number 
1820-0550)

(Authority: 20 U.S.C. 1435(a)(9))
    Note: This section requires that a State use its own existing 
highest requirements to determine the standards appropriate to personnel 
who provide early intervention services under this part. The regulations 
do not require States to set any specified training standard, such as a 
master's degree, for employment of personnel who provide services under 
this part.
    The regulations permit each State to determine the specific 
occupational categories required to provide early intervention services 
to children eligible under this part and their families, and to revise 
or expand these

[[Page 204]]

categories as needed. The professions or disciplines need not be limited 
to traditional occupational categories.

[58 FR 40959, July 30, 1993, as amended at 63 FR 18295, Apr. 14, 1998]



                     Subpart E_Procedural Safeguards

                                 General



Sec. 303.400  General responsibility of lead agency for procedural 
safeguards.

    Each lead agency shall be responsible for--
    (a) Establishing or adopting procedural safeguards that meet the 
requirements of this subpart; and
    (b) Ensuring effective implementation of the safeguards by each 
public agency in the State that is involved in the provision of early 
intervention services under this part.

(Authority: 20 U.S.C. 1439)



Sec. 303.401  Definitions of consent, native language, and personally 
identifiable information.

    As used in this subpart--
    (a) Consent means that--
    (1) The parent has been fully informed of all information relevant 
to the activity for which consent is sought, in the parent's native 
language or other mode of communication;
    (2) The parent understands and agrees in writing to the carrying out 
of the activity for which consent is sought, and the consent describes 
that activity and lists the records (if any) that will be released and 
to whom; and
    (3) The parent understands that the granting of consent is voluntary 
on the part of the parent and may be revoked at any time;
    (b) Native language, where used with reference to persons of limited 
English proficiency, means the language or mode of communication 
normally used by the parent of a child eligible under this part;
    (c) Personally identifiable means that information includes--
    (1) The name of the child, the child's parent, or other family 
member;
    (2) The address of the child;
    (3) A personal identifier, such as the child's or parent's social 
security number; or
    (4) A list of personal characteristics or other information that 
would make it possible to identify the child with reasonable certainty.

(Authority: 20 U.S.C. 1439)



Sec. 303.402  Opportunity to examine records.

    In accordance with the confidentiality procedures in the regulations 
under part B of the Act (34 CFR 300.560 through 300.576), the parents of 
a child eligible under this part must be afforded the opportunity to 
inspect and review records relating to evaluations and assessments, 
eligibility determinations, development and implementation of IFSPs, 
individual complaints dealing with the child, and any other area under 
this part involving records about the child and the child's family.

(Authority: 20 U.S.C. 1439(a)(4))



Sec. 303.403  Prior notice; native language.

    (a) General. Written prior notice must be given to the parents of a 
child eligible under this part a reasonable time before a public agency 
or service provider proposes, or refuses, to initiate or change the 
identification, evaluation, or placement of the child, or the provision 
of appropriate early intervention services to the child and the child's 
family.
    (b) Content of notice. The notice must be in sufficient detail to 
inform the parents about--
    (1) The action that is being proposed or refused;
    (2) The reasons for taking the action;
    (3) All procedural safeguards that are available under Sec. Sec. 
303.401-303.460 of this part; and
    (4) The State complaint procedures under Sec. Sec. 303.510-303.512, 
including a description of how to file a complaint and the timelines 
under those procedures.
    (c) Native language. (1) The notice must be--
    (i) Written in language understandable to the general public; and
    (ii) Provided in the native language of the parents, unless it is 
clearly not feasible to do so.
    (2) If the native language or other mode of communication of the 
parent is not a written language, the public

[[Page 205]]

agency, or designated service provider, shall take steps to ensure 
that--
    (i) The notice is translated orally or by other means to the parent 
in the parent's native language or other mode of communication;
    (ii) The parent understands the notice; and
    (iii) There is written evidence that the requirements of this 
paragraph have been met.
    (3) If a parent is deaf or blind, or has no written language, the 
mode of communication must be that normally used by the parent (such as 
sign language, braille, or oral communication).

(Authority: 20 U.S.C. 1439(a)(6) and (7))

[58 FR 40959, July 30, 1993, as amended at 64 FR 12536, Mar. 12, 1999]



Sec. 303.404  Parent consent.

    (a) Written parental consent must be obtained before--
    (1) Conducting the initial evaluation and assessment of a child 
under Sec. 303.322; and
    (2) Initiating the provision of early intervention services (see 
Sec. 303.342(e)).
    (b) If consent is not given, the public agency shall make reasonable 
efforts to ensure that the parent--
    (1) Is fully aware of the nature of the evaluation and assessment or 
the services that would be available; and
    (2) Understands that the child will not be able to receive the 
evaluation and assessment or services unless consent is given.

(Authority: 20 U.S.C. 1439)
    Note 1: In addition to the consent requirements in this section, 
other consent requirements are included in (1) Sec. 303.460(a), 
regarding the exchange of personally identifiable information among 
agencies, and (2) the confidentiality provisions in the regulations 
under part B of the Act (34 CFR 300.571) and 34 CFR part 99 (Family 
Educational Rights and Privacy), both of which apply to this part.
    Note 2: Under Sec. 300.504(b) of the part B regulations, a public 
agency may initiate procedures to challenge a parent's refusal to 
consent to the initial evaluation of the parent's child and, if 
successful, obtain the evaluation. This provision applies to eligible 
children under this part, since the part B evaluation requirement 
applies to all children with disabilities in a State, including infants 
and toddlers.



Sec. 303.405  Parent right to decline service.

    The parents of a child eligible under this part may determine 
whether they, their child, or other family members will accept or 
decline any early intervention service under this part in accordance 
with State law, and may decline such a service after first accepting it, 
without jeopardizing other early intervention services under this part.

(Authority: 20 U.S.C. 1439(a)(3))



Sec. 303.406  Surrogate parents.

    (a) General. Each lead agency shall ensure that the rights of 
children eligible under this part are protected if--
    (1) No parent (as defined in Sec. 303.18) can be identified;
    (2) The public agency, after reasonable efforts, cannot discover the 
whereabouts of a parent; or
    (3) The child is a ward of the State under the laws of that State.
    (b) Duty of lead agency and other public agencies. The duty of the 
lead agency, or other public agency under paragraph (a) of this section, 
includes the assignment of an individual to act as a surrogate for the 
parent. This must include a method for--
    (1) Determining whether a child needs a surrogate parent; and
    (2) Assigning a surrogate parent to the child.
    (c) Criteria for selecting surrogates. (1) The lead agency or other 
public agency may select a surrogate parent in any way permitted under 
State law.
    (2) Public agencies shall ensure that a person selected as a 
surrogate parent--
    (i) Has no interest that conflicts with the interests of the child 
he or she represents; and
    (ii) Has knowledge and skills that ensure adequate representation of 
the child.
    (d) Non-employee requirement; compensation. (1) A person assigned as 
a surrogate parent may not be--
    (i) An employee of any State agency; or
    (ii) A person or an employee of a person providing early 
intervention services to the child or to any family member of the child.

[[Page 206]]

    (2) A person who otherwise qualifies to be a surrogate parent under 
paragraph (d)(1) of this section is not an employee solely because he or 
she is paid by a public agency to serve as a surrogate parent.
    (e) Responsibilities. A surrogate parent may represent a child in 
all matters related to--
    (1) The evaluation and assessment of the child;
    (2) Development and implementation of the child's IFSPs, including 
annual evaluations and periodic reviews;
    (3) The ongoing provision of early intervention services to the 
child; and
    (4) Any other rights established under this part.

(Authority: 20 U.S.C. 1439(a)(5))

[58 FR 40959, July 30, 1993, as amended at 63 FR 18296, Apr. 14, 1998]

      Mediation and Due Process Procedures for Parents and Children



Sec. 303.419  Mediation.

    (a) General. Each State shall ensure that procedures are established 
and implemented to allow parties to disputes involving any matter 
described in Sec. 303.403(a) to resolve the disputes through a 
mediation process which, at a minimum, must be available whenever a 
hearing is requested under Sec. 303.420. The lead agency may either use 
the mediation system established under Part B of the Act or establish 
its own system.
    (b) Requirements. The procedures must meet the following 
requirements:
    (1) The procedures must ensure that the mediation process--
    (i) Is voluntary on the part of the parties;
    (ii) Is not used to deny or delay a parent's right to a due process 
hearing under Sec. 303.420, or to deny any other rights afforded under 
Part C of the Act; and
    (iii) Is conducted by a qualified and impartial mediator who is 
trained in effective mediation techniques.
    (2) The State shall maintain a list of individuals who are qualified 
mediators and knowledgeable in laws and regulations relating to the 
provision of special education and related services.
    (3) The State shall bear the cost of the mediation process, 
including the costs of meetings described in paragraph (c) of this 
section.
    (4) Each session in the mediation process must be scheduled in a 
timely manner and must be held in a location that is convenient to the 
parties to the dispute.
    (5) An agreement reached by the parties to the dispute in the 
mediation process must be set forth in a written mediation agreement.
    (6) Discussions that occur during the mediation process must be 
confidential and may not be used as evidence in any subsequent due 
process hearings or civil proceedings, and the parties to the mediation 
process may be required to sign a confidentiality pledge prior to the 
commencement of the process.
    (c) Meeting to encourage mediation. A State may establish procedures 
to require parents who elect not to use the mediation process to meet, 
at a time and location convenient to the parents, with a disinterested 
party--
    (1) Who is under contract with a parent training and information 
center or community parent resource center in the State established 
under sections 682 or 683 of the Act, or an appropriate alternative 
dispute resolution entity; and
    (2) Who would explain the benefits of the mediation process and 
encourage the parents to use the process.

(Authority: 20 U.S.C. 1415(e) and 1439(a)(8))

[63 FR 18296, Apr. 14, 1998]



Sec. 303.420  Due process procedures.

    Each system must include written procedures including procedures for 
mediation as described in Sec. 303.419, for the timely administrative 
resolution of individual child complaints by parents concerning any of 
the matters in Sec. 303.403(a). A State may meet this requirement by--
    (a) Adopting the mediation and due process procedures in 34 CFR 
300.506 through 300.512 and developing procedures that meet the 
requirements of Sec. 303.425; or
    (b) Developing procedures that--
    (1) Meet the requirements in Sec. 303.419 and Sec. Sec. 303.421 
through 303.425; and

[[Page 207]]

    (2) Provide parents a means of filing a complaint.

(Approved by the Office of Management and Budget under control number 
1820-0550)

(Authority: 20 U.S.C. 1439(a)(1))
    Note 1: Sections 303.420 through 303.425 are concerned with the 
adoption of impartial procedures for resolving individual child 
complaints (i.e., complaints that generally affect only a single child 
or the child's family). These procedures require the appointment of a 
decision-maker who is impartial, as defined in Sec. 303.421(b), to 
resolve a dispute concerning any of the matters in Sec. 303.403(a). The 
decision of the impartial decision-maker is binding unless it is 
reversed on appeal.
    A different type of administrative procedure is included in 
Sec. Sec. 303.510 through 303.512 of subpart F of this part. Under 
those procedures, the lead agency is responsible for (1) investigating 
any complaint that it receives (including individual child complaints 
and those that are systemic in nature), and (2) resolving the complaint 
if the agency determines that a violation has occurred.
    Note 2: It is important that the administrative procedures developed 
by a State be designed to result in speedy resolution of complaints. An 
infant's or toddler's development is so rapid that undue delay could be 
potentially harmful.

[58 FR 40959, July 30, 1993, as amended at 63 FR 18296, Apr. 14, 1998]



Sec. 303.421  Appointment of an impartial person.

    (a) Qualifications and duties. An impartial person must be appointed 
to implement the complaint resolution process in this subpart. The 
person must--
    (1) Have knowledge about the provisions of this part and the needs 
of, and services available for, eligible children and their families; 
and
    (2) Perform the following duties:
    (i) Listen to the presentation of relevant viewpoints about the 
complaint, examine all information relevant to the issues, and seek to 
reach a timely resolution of the complaint.
    (ii) Provide a record of the proceedings, including a written 
decision.
    (b) Definition of impartial. (1) As used in this section, impartial 
means that the person appointed to implement the complaint resolution 
process--
    (i) Is not an employee of any agency or other entity involved in the 
provision of early intervention services or care of the child; and
    (ii) Does not have a personal or professional interest that would 
conflict with his or her objectivity in implementing the process.
    (2) A person who otherwise qualifies under paragraph (b)(1) of this 
section is not an employee of an agency solely because the person is 
paid by the agency to implement the complaint resolution process.

(Approved by the Office of Management and Budget under control number 
1820-0550)

(Authority: 20 U.S.C. 1439(a)(1))



Sec. 303.422  Parent rights in administrative proceedings.

    (a) General. Each lead agency shall ensure that the parents of 
children eligible under this part are afforded the rights in paragraph 
(b) of this section in any administrative proceedings carried out under 
Sec. 303.420.
    (b) Rights. Any parent involved in an administrative proceeding has 
the right to--
    (1) Be accompanied and advised by counsel and by individuals with 
special knowledge or training with respect to early intervention 
services for children eligible under this part;
    (2) Present evidence and confront, cross-examine, and compel the 
attendance of witnesses;
    (3) Prohibit the introduction of any evidence at the proceeding that 
has not been disclosed to the parent at least five days before the 
proceeding;
    (4) Obtain a written or electronic verbatim transcription of the 
proceeding; and
    (5) Obtain written findings of fact and decisions.

(Approved by the Office of Management and Budget under control number 
1820-0550)

(Authority: 20 U.S.C. 1439)



Sec. 303.423  Convenience of proceedings; timelines.

    (a) Any proceeding for implementing the complaint resolution process 
in this subpart must be carried out at a time and place that is 
reasonably convenient to the parents.
    (b) Each lead agency shall ensure that, not later than 30 days after 
the receipt of a parent's complaint, the impartial proceeding required 
under this

[[Page 208]]

subpart is completed and a written decision mailed to each of the 
parties.

(Approved by the Office of Management and Budget under control number 
1820-0550)

(Authority: 20 U.S.C. 1439(a)(1))
    Note: Under part B of the Act, States are allowed 45 days to conduct 
an impartial due process hearing (i.e., within 45 days after the receipt 
of a request for a hearing, a decision is reached and a copy of the 
decision is mailed to each of the parties). (See 34 CFR 300.512.) Thus, 
if a State, in meeting the requirements of Sec. 303.420, elects to 
adopt the due process procedures under part B, that State would also 
have 45 days for hearings. However, any State in that situation is 
encouraged (but not required) to accelerate the timeline for the due 
process hearing for children who are eligible under this part--from 45 
days to the 30-day timeline in this section. Because the needs of 
children in the birth-through-two-age range change so rapidly, quick 
resolution of complaints is important.



Sec. 303.424  Civil action.

    Any party aggrieved by the findings and decision regarding an 
administrative complaint has the right to bring a civil action in State 
or Federal court under section 639(a)(1) of the Act.

(Approved by the Office of Management and Budget under control number 
1820-0550)

(Authority: 20 U.S.C. 1439(a)(1))

[58 FR 40959, July 30, 1993, as amended at 63 FR 18296, Apr. 14, 1998]



Sec. 303.425  Status of a child during proceedings.

    (a) During the pendency of any proceeding involving a complaint 
under this subpart, unless the public agency and parents of a child 
otherwise agree, the child must continue to receive the appropriate 
early intervention services currently being provided.
    (b) If the complaint involves an application for initial services 
under this part, the child must receive those services that are not in 
dispute.

(Approved by the Office of Management and Budget under control number 
1820-0550)

(Authority: 20 U.S.C. 1439(a)(7))

                             Confidentiality



Sec. 303.460  Confidentiality of information.

    (a) Each State shall adopt or develop policies and procedures that 
the State will follow in order to ensure the protection of any 
personally identifiable information collected, used, or maintained under 
this part, including the right of parents to written notice of and 
written consent to the exchange of this information among agencies 
consistent with Federal and State law.
    (b) These policies and procedures must meet the requirements in 34 
CFR 300.560 through 300.576, with the modifications specified in Sec. 
303.5(b).

(Approved by the Office of Management and Budget under control number 
1820-0550)

(Authority: 20 U.S.C. 1439(a)(2), 1442)
    Note: With the modifications referred to in paragraph (b) of this 
section, the confidentiality requirements in the regulations 
implementing part B of the Act (34 CFR 300.560 through 300.576) are to 
be used by public agencies to meet the confidentiality requirements 
under part C of the Act and this section (Sec. 303.460).
    The part B provisions incorporate by reference the regulations in 34 
CFR part 99 (Family Educational Rights and Privacy); therefore, those 
regulations also apply to this part.



                     Subpart F_State Administration

                                 General



Sec. 303.500  Lead agency establishment or designation.

    Each system must include a single line of responsibility in a lead 
agency that--
    (a) Is established or designated by the Governor; and
    (b) Is responsible for the administration of the system, in 
accordance with the requirements of this part.

(Approved by the Office of Management and Budget under control number 
1820-0550)

(Authority: 20 U.S.C. 1435(a)(10))



Sec. 303.501  Supervision and monitoring of programs.

    (a) General. Each lead agency is responsible for--
    (1) The general administration and supervision of programs and 
activities receiving assistance under this part; and
    (2) The monitoring of programs and activities used by the State to 
carry

[[Page 209]]

out this part, whether or not these programs or activities are receiving 
assistance under this part, to ensure that the State complies with this 
part.
    (b) Methods of administering programs. In meeting the requirement in 
paragraph (a) of this section, the lead agency shall adopt and use 
proper methods of administering each program, including--
    (1) Monitoring agencies, institutions, and organizations used by the 
State to carry out this part;
    (2) Enforcing any obligations imposed on those agencies under part C 
of the Act and these regulations;
    (3) Providing technical assistance, if necessary, to those agencies, 
institutions, and organizations; and
    (4) Correcting deficiencies that are identified through monitoring.

(Approved by the Office of Management and Budget under control number 
1820-0550)

(Authority: 20 U.S.C. 1435(a)(10)(A))

             Lead Agency Procedures for Resolving Complaints



Sec. 303.510  Adopting complaint procedures.

    (a) General. Each lead agency shall adopt written procedures for--
    (1) Resolving any complaint, including a complaint filed by an 
organization or individual from another State, that any public agency or 
private service provider is violating a requirement of Part C of the Act 
or this Part by--
    (i) Providing for the filing of a complaint with the lead agency; 
and
    (ii) At the lead agency's discretion, providing for the filing of a 
complaint with a public agency and the right to have the lead agency 
review the public agency's decision on the complaint; and
    (2) Widely disseminating to parents and other interested 
individuals, including parent training centers, protection and advocacy 
agencies, independent living centers, and other appropriate entities, 
the State's procedures under Sec. Sec. 303.510-303.512.
    (b) Remedies for denial of appropriate services. In resolving a 
complaint in which it finds a failure to provide appropriate services, a 
lead agency, pursuant to its general supervisory authority under Part C 
of the Act, must address:
    (1) How to remediate the denial of those services, including, as 
appropriate, the awarding of monetary reimbursement or other corrective 
action appropriate to the needs of the child and the child's family; and
    (2) Appropriate future provision of services for all infants and 
toddlers with disabilities and their families.

(Authority: 20 U.S.C. 1435(a)(10))

[64 FR 12536, Mar. 12, 1999]



Sec. 303.511  An organization or individual may file a complaint.

    (a) General. An individual or organization may file a written signed 
complaint under Sec. 303.510. The complaint must include--
    (1) A statement that the State has violated a requirement of part C 
of the Act or the regulations in this part; and
    (2) The facts on which the complaint is based.
    (b) Limitations. The alleged violation must have occurred not more 
than one year before the date that the complaint is received by the 
public agency unless a longer period is reasonable because--
    (1) The alleged violation continues for that child or other 
children; or
    (2) The complainant is requesting reimbursement or corrective action 
for a violation that occurred not more than three years before the date 
on which the complaint is received by the public agency.

(Authority: 20 U.S.C. 1435(a)(10))

[64 FR 12536, Mar. 12, 1999]



Sec. 303.512  Minimum State complaint procedures.

    (a) Time limit, minimum procedures. Each lead agency shall include 
in its complaint procedures a time limit of 60 calendar days after a 
complaint is filed under Sec. 303.510(a) to--
    (1) Carry out an independent on-site investigation, if the lead 
agency determines that such an investigation is necessary;
    (2) Give the complainant the opportunity to submit additional 
information, either orally or in writing, about the allegations in the 
complaint;

[[Page 210]]

    (3) Review all relevant information and make an independent 
determination as to whether the public agency is violating a requirement 
of Part C of the Act or of this Part; and
    (4) Issue a written decision to the complainant that addresses each 
allegation in the complaint and contains--
    (i) Findings of fact and conclusions; and
    (ii) The reasons for the lead agency's final decision.
    (b) Time extension; final decisions; implementation. The lead 
agency's procedures described in paragraph (a) of this section also 
must--
    (1) Permit an extension of the time limit under paragraph (a) of 
this section only if exceptional circumstances exist with respect to a 
particular complaint; and
    (2) Include procedures for effective implementation of the lead 
agency's final decision, if needed, including--
    (i) Technical assistance activities;
    (ii) Negotiations; and
    (iii) Corrective actions to achieve compliance.
    (c) Complaints filed under this section, and due process hearings 
under Sec. 303.420. (1) If a written complaint is received that is also 
the subject of a due process hearing under Sec. 303.420, or contains 
multiple issues, of which one or more are part of that hearing, the 
State must set aside any part of the complaint that is being addressed 
in the due process hearing until the conclusion of the hearing. However, 
any issue in the complaint that is not a part of the due process action 
must be resolved within the 60-calendar-day timeline using the complaint 
procedures described in paragraphs (a) and (b) of this section.
    (2) If an issue is raised in a complaint filed under this section 
that has previously been decided in a due process hearing involving the 
same parties--
    (i) The hearing decision is binding; and
    (ii) The lead agency must inform the complainant to that effect.
    (3) A complaint alleging a public agency's or private service 
provider's failure to implement a due process decision must be resolved 
by the lead agency.

(Authority: 20 U.S.C. 1435(a)(10))

[64 FR 12536, Mar. 12, 1999]

          Policies and Procedures Related to Financial Matters



Sec. 303.520  Policies related to payment for services.

    (a) General. Each lead agency is responsible for establishing State 
policies related to how services to children eligible under this part 
and their families will be paid for under the State's early intervention 
program. The policies must--
    (1) Meet the requirements in paragraph (b) of this section; and
    (2) Be reflected in the interagency agreements required in Sec. 
303.523.
    (b) Specific funding policies. A State's policies must--
    (1) Specify which functions and services will be provided at no cost 
to all parents;
    (2) Specify which functions or services, if any, will be subject to 
a system of payments, and include--
    (i) Information about the payment system and schedule of sliding 
fees that will be used; and
    (ii) The basis and amount of payments; and
    (3) Include an assurance that--
    (i) Fees will not be charged for the services that a child is 
otherwise entitled to receive at no cost to parents; and
    (ii) The inability of the parents of an eligible child to pay for 
services will not result in the denial of services to the child or the 
child's family; and
    (4) Set out any fees that will be charged for early intervention 
services and the basis for those fees.
    (c) Procedures to ensure the timely provision of services. No later 
than the beginning of the fifth year of a State's participation under 
this part, the State shall implement a mechanism to ensure that no 
services that a child is entitled to receive are delayed or denied 
because of disputes between agencies regarding financial or other 
responsibilities.

[[Page 211]]

    (d) Proceeds from public or private insurance. (1) Proceeds from 
public or private insurance are not treated as program income for 
purposes of 34 CFR 80.25.
    (2) If a public agency spends reimbursements from Federal funds 
(e.g., Medicaid) for services under this part, those funds are not 
considered State or local funds for purposes of the provisions contained 
in Sec. 303.124.

(Authority: 20 U.S.C. 1432(4)(B), 1435(a)(10))

[58 FR 40959, July 30, 1993, as amended at 64 FR 12536, Mar. 12, 1999]



Sec. 303.521  Fees.

    (a) General. A State may establish, consistent with Sec. 
303.12(a)(3)(iv), a system of payments for early intervention services, 
including a schedule of sliding fees.
    (b) Functions not subject to fees. The following are required 
functions that must be carried out at public expense by a State, and for 
which no fees may be charged to parents:
    (1) Implementing the child find requirements in Sec. 303.321.
    (2) Evaluation and assessment, as included in Sec. 303.322, and 
including the functions related to evaluation and assessment in Sec. 
303.12.
    (3) Service coordination, as included in Sec. Sec. 303.22 and 
303.344(g).
    (4) Administrative and coordinative activities related to--
    (i) The development, review, and evaluation of IFSPs in Sec. Sec. 
303.340 through 303.346; and
    (ii) Implementation of the procedural safeguards in subpart E of 
this part and the other components of the statewide system of early 
intervention services in subparts D and F of this part.
    (c) States with mandates to serve children from birth. If a State 
has in effect a State law requiring the provision of a free appropriate 
public education to children with disabilities from birth, the State may 
not charge parents for any services (e.g., physical or occupational 
therapy) required under that law that are provided to children eligible 
under this part and their families.

(Approved by the Office of Management and Budget under control number 
1820-0550)

(Authority: 20 U.S.C. 1432(4))



Sec. 303.522  Identification and coordination of resources.

    (a) Each lead agency is responsible for--
    (1) The identification and coordination of all available resources 
for early intervention services within the State, including those from 
Federal, State, local, and private sources; and
    (2) Updating the information on the funding sources in paragraph 
(a)(1) of this section, if a legislative or policy change is made under 
any of those sources.
    (b) The Federal funding sources in paragraph (a)(1) of this section 
include--
    (1) Title V of the Social Security Act (relating to Maternal and 
Child Health);
    (2) Title XIX of the Social Security Act (relating to the general 
Medicaid Program, and EPSDT);
    (3) The Head Start Act;
    (4) Parts B and H of the Act;
    (5) The Developmental Disabilities Assistance and Bill of Rights Act 
(Pub. L. 94-103); and
    (6) Other Federal programs.

(Approved by the Office of Management and Budget under control number 
1820-0550)

(Authority: 20 U.S.C. 1435(a)(10)(B))

[58 FR 40959, July 30, 1993, as amended at 63 FR 18296, Apr. 14, 1998]



Sec. 303.523  Interagency agreements.

    (a) General. Each lead agency is responsible for entering into 
formal interagency agreements with other State-level agencies involved 
in the State's early intervention program. Each agreement must meet the 
requirements in paragraphs (b) through (d) of this section.
    (b) Financial responsibility. Each agreement must define the 
financial responsibility, in accordance with Sec. 303.143, of the 
agency for paying for early intervention services (consistent with State 
law and the requirements of this part).
    (c) Procedures for resolving disputes. (1) Each agreement must 
include procedures for achieving a timely resolution of intra-agency and 
interagency disputes about payments for a given service, or disputes 
about other matters related to the State's early intervention

[[Page 212]]

program. Those procedures must include a mechanism for making a final 
determination that is binding upon the agencies involved.
    (2) The agreement with each agency must--
    (i) Permit the agency to resolve its own internal disputes (based on 
the agency's procedures that are included in the agreement), so long as 
the agency acts in a timely manner; and
    (ii) Include the process that the lead agency will follow in 
achieving resolution of intra-agency disputes, if a given agency is 
unable to resolve its own internal disputes in a timely manner.
    (d) Additional components. Each agreement must include any 
additional components necessary to ensure effective cooperation and 
coordination among all agencies involved in the State's early 
intervention program.

(Approved by the Office of Management and Budget under control number 
1820-0550)

(Authority: 20 U.S.C. 1435(a)(10)(C) and (a)(10)(F))
    Note: A State may meet the requirement in paragraph (c)(1) of this 
section in any way permitted under State law, including (1) providing 
for a third party (e.g., an administrative law judge) to review a 
dispute and render a decision, (2) assignment of the responsibility by 
the Governor to the lead agency or Council, or (3) having the final 
decision made directly by the Governor.



Sec. 303.524  Resolution of disputes.

    (a) Each lead agency is responsible for resolving individual 
disputes, in accordance with the procedures in Sec. 303.523(c)(2)(ii).
    (b)(1) During a dispute, the individual or entity responsible for 
assigning financial responsibility among appropriate agencies under 
Sec. 303.143 (``financial designee'') shall assign financial 
responsibility to--
    (i) An agency, subject to the provisions in paragraph (b)(2) of this 
section; or
    (ii) The lead agency, in accordance with the ``payor of last 
resort'' provisions in Sec. 303.527.
    (2) If, during the lead agency's resolution of the dispute, the 
financial designee determines that the assignment of financial 
responsibility under paragraph (b)(1)(i) of this section was 
inappropriately made--
    (i) The financial designee shall reassign the responsibility to the 
appropriate agency; and
    (ii) The lead agency shall make arrangements for reimbursement of 
any expenditures incurred by the agency originally assigned 
responsibility.
    (c) To the extent necessary to ensure compliance with its action in 
paragraph (b)(2) of this section, the lead agency shall--
    (1) Refer the dispute to the Council or the Governor; and
    (2) Implement the procedures to ensure the delivery of services in a 
timely manner in accordance with Sec. 303.525.

(Approved by the Office of Management and Budget under control number 
1820-0550)

(Authority: 20 U.S.C. 1435(a)(10)(C) and (a)(10)(E))



Sec. 303.525  Delivery of services in a timely manner.

    Each lead agency is responsible for the development of procedures to 
ensure that services are provided to eligible children and their 
families in a timely manner, pending the resolution of disputes among 
public agencies or service providers.

(Approved by the Office of Management and Budget under control number 
1820-0550)

(Authority: 20 U.S.C. 1435(a)(10)(D))



Sec. 303.526  Policy for contracting or otherwise arranging for services.

    Each system must include a policy pertaining to contracting or 
making other arrangements with public or private service providers to 
provide early intervention services. The policy must include--
    (a) A requirement that all early intervention services must meet 
State standards and be consistent with the provisions of this part;
    (b) The mechanisms that the lead agency will use in arranging for 
these services, including the process by which awards or other 
arrangements are made; and

[[Page 213]]

    (c) The basic requirements that must be met by any individual or 
organization seeking to provide these services for the lead agency.

(Approved by the Office of Management and Budget under control number 
1820-0550)

(Authority: 20 U.S.C. 1435(a)(11))
    Note: In implementing the statewide system, States may elect to 
continue using agencies and individuals in both the public and private 
sectors that have previously been involved in providing early 
intervention services, so long as those agencies and individuals meet 
the requirements of this part.



Sec. 303.527  Payor of last resort.

    (a) Nonsubstitution of funds. Except as provided in paragraph (b)(1) 
of this section, funds under this part may not be used to satisfy a 
financial commitment for services that would otherwise have been paid 
for from another public or private source, including any medical program 
administered by the Secretary of Defense, but for the enactment of part 
C of the Act. Therefore, funds under this part may be used only for 
early intervention services that an eligible child needs but is not 
currently entitled to under any other Federal, State, local, or private 
source.
    (b) Interim payments--reimbursement. (1) If necessary to prevent a 
delay in the timely provision of services to an eligible child or the 
child's family, funds under this part may be used to pay the provider of 
services, pending reimbursement from the agency or entity that has 
ultimate responsibility for the payment.
    (2) Payments under paragraph (b)(1) of this section may be made 
for--
    (i) Early intervention services, as described in Sec. 303.12;
    (ii) Eligible health services (see Sec. 303.13); and
    (iii) Other functions and services authorized under this part, 
including child find and evaluation and assessment.
    (3) The provisions of paragraph (b)(1) of this section do not apply 
to medical services or ``well-baby'' health care (see Sec. 
303.13(c)(1)).
    (c) Non-reduction of benefits. Nothing in this part may be construed 
to permit a State to reduce medical or other assistance available or to 
alter eligibility under title V of the Social Security Act (SSA) 
(relating to maternal and child health) or title XIX of the SSA 
(relating to Medicaid for children eligible under this part) within the 
State.

(Approved by the Office of Management and Budget under control number 
1820-0550)

(Authority: 20 U.S.C. 1440)
    Note: The Congress intended that the enactment of part C not be 
construed as a license to any agency (including the lead agency and 
other agencies in the State) to withdraw funding for services that 
currently are or would be made available to eligible children but for 
the existence of the program under this part. Thus, the Congress 
intended that other funding sources would continue, and that there would 
be greater coordination among agencies regarding the payment of costs.
    The Congress further clarified its intent concerning payments under 
Medicaid by including in section 411(k)(13) of the Medicare Catastrophic 
Coverage Act of 1988 (Pub. L. 100-360) an amendment to title XIX of the 
Social Security Act. That amendment states, in effect, that nothing in 
this title shall be construed as prohibiting or restricting, or 
authorizing the Secretary of Health and Human Services to prohibit or 
restrict, payment under subsection (a) of section 1903 of the Social 
Security Act for medical assistance for covered services furnished to an 
infant or toddler with a disability because those services are included 
in the child's IFSP adopted pursuant to part C of the Act.

[58 FR 40959, July 30, 1993, as amended at 63 FR 18296, Apr. 14, 1998]



Sec. 303.528  Reimbursement procedure.

    Each system must include a procedure for securing the timely 
reimbursement of funds used under this part, in accordance with Sec. 
303.527(b).

(Approved by the Office of Management and Budget under control number 
1820-0550)

(Authority: 20 U.S.C. 1435(a)(12))

                         Reporting Requirements



Sec. 303.540  Data collection.

    (a) Each system must include the procedures that the State uses to 
compile data on the statewide system. The procedures must--
    (1) Include a process for--
    (i) Collecting data from various agencies and service providers in 
the State;

[[Page 214]]

    (ii) Making use of appropriate sampling methods, if sampling is 
permitted; and
    (iii) Describing the sampling methods used, if reporting to the 
Secretary; and
    (2) Provide for reporting data required under section 618 of the Act 
that relates to this part.
    (b) The information required in paragraph (a)(2) of this section 
must be provided at the time and in the manner specified by the 
Secretary.

(Approved by the Office of Management and Budget under control number 
1820-0550)

(Authority: 20 U.S.C. 1435(a)(14))

[58 FR 40959, July 30, 1993, as amended at 63 FR 18296, Apr. 14, 1998]

                  Use of Funds for State Administration



Sec. 303.560  Use of funds by the lead agency.

    A lead agency may use funds under this part that are reasonable and 
necessary for administering the State's early intervention program for 
infants and toddlers with disabilities.

(Authority: 20 U.S.C. 1433, 1435(a)(10))



            Subpart G_State Interagency Coordinating Council

                                 General



Sec. 303.600  Establishment of Council.

    (a) A State that desires to receive financial assistance under this 
part shall establish a State Interagency Coordinating Council.
    (b) The Council must be appointed by the Governor. The Governor 
shall ensure that the membership of the Council reasonably represents 
the population of the State.
    (c) The Governor shall designate a member of the Council to serve as 
the chairperson of the Council or require the Council to do so. Any 
member of the Council who is a representative of the lead agency 
designated under Sec. 303.500 may not serve as the chairperson of the 
Council.

(Approved by the Office of Management and Budget under control number 
1820-0550)

(Authority: 20 U.S.C. 1441(a))
    Note: To avoid a potential conflict of interest, it is recommended 
that parent representatives who are selected to serve on the Council not 
be employees of any agency involved in providing early intervention 
services.
    It is suggested that consideration be given to maintaining an 
appropriate balance between the urban and rural communities of the 
State.

[58 FR 40959, July 30, 1993, as amended at 63 FR 18296, Apr. 14, 1998]



Sec. 303.601  Composition.

    (a) The Council must be composed as follows:
    (1)(i) At least 20 percent of the members must be parents, including 
minority parents, of infants or toddlers with disabilities or children 
with disabilities aged 12 or younger, with knowledge of, or experience 
with, programs for infants and toddlers with disabilities.
    (ii) At least one member must be a parent of an infant or toddler 
with a disability or a child with a disability aged six or younger.
    (2) At least 20 percent of the members must be public or private 
providers of early intervention services.
    (3) At least one member must be from the State legislature.
    (4) At least one member must be involved in personnel preparation.
    (5) At least one member must--
    (i) Be from each of the State agencies involved in the provisions 
of, or payment for, early intervention services to infants and toddlers 
with disabilities and their families; and
    (ii) Have sufficient authority to engage in policy planning and 
implementation on behalf of these agencies.
    (6) At least one member must--
    (i) Be from the State educational agency responsible for preschool 
services to children with disabilities; and
    (ii) Have sufficient authority to engage in policy planning and 
implementation on behalf of that agency.
    (7) At least one member must be from the agency responsible for the 
State governance of health insurance.
    (8) At least one member must be from a Head Start agency or program 
in the State.
    (9) At least one member must be from a State agency responsible for 
child care.
    (b) The Council may include other members selected by the Governor, 
including a representative from the BIA

[[Page 215]]

or, where there is no school operated or funded by the BIA, from the 
Indian Health Service or the tribe or tribal council.

(Approved by the Office of Management and Budget under control number 
1820-0550)

(Authority: 20 U.S.C. 1441(b))

[58 FR 40959, July 30, 1993, as amended at 63 FR 18296, Apr. 14, 1998]



Sec. 303.602  Use of funds by the Council.

    (a) General. Subject to the approval of the Governor, the Council 
may use funds under this part--
    (1) To conduct hearings and forums;
    (2) To reimburse members of the Council for reasonable and necessary 
expenses for attending Council meetings and performing Council duties 
(including child care for parent representatives);
    (3) To pay compensation to a member of the Council if the member is 
not employed or must forfeit wages from other employment when performing 
official Council business;
    (4) To hire staff; and
    (5) To obtain the services of professional, technical, and clerical 
personnel, as may be necessary to carry out the performance of its 
functions under this part.
    (b) Compensation and expenses of Council members. Except as provided 
in paragraph (a) of this section, Council members shall serve without 
compensation from funds available under this part.

(Approved by the Office of Management and Budget under control number 
1820-0550)

(Authority: 20 U.S.C. 1438, 1441 (c) and (d))

[58 FR 40959, July 30, 1993, as amended at 63 FR 18296, Apr. 14, 1998]



Sec. 303.603  Meetings.

    (a) The Council shall meet at least quarterly and in such places as 
it deems necessary.
    (b) The meetings must--
    (1) Be publicly announced sufficiently in advance of the dates they 
are to be held to ensure that all interested parties have an opportunity 
to attend; and
    (2) To the extent appropriate, be open and accessible to the general 
public.
    (c) Interpreters for persons who are deaf and other necessary 
services must be provided at Council meetings, both for Council members 
and participants. The Council may use funds under this part to pay for 
those services.

(Approved by the Office of Management and Budget under control number 
1820-0550)

(Authority: 20 U.S.C. 1441 (c) and (d))



Sec. 303.604  Conflict of interest.

    No member of the Council may cast a vote on any matter that would 
provide direct financial benefit to that member or otherwise give the 
appearance of a conflict of interest.

(Approved by the Office of Management and Budget under control number 
1820-0550)

(Authority: 20 U.S.C. 1441(f))

                        Functions of the Council



Sec. 303.650  General.

    (a) Each Council shall--
    (1) Advise and assist the lead agency in the development and 
implementation of the policies that constitute the statewide system;
    (2) Assist the lead agency in achieving the full participation, 
coordination, and cooperation of all appropriate public agencies in the 
State;
    (3) Assist the lead agency in the effective implementation of the 
statewide system, by establishing a process that includes--
    (i) Seeking information from service providers, service 
coordinators, parents, and others about any Federal, State, or local 
policies that impede timely service delivery; and
    (ii) Taking steps to ensure that any policy problems identified 
under paragraph (a)(3)(i) of this section are resolved; and
    (4) To the extent appropriate, assist the lead agency in the 
resolution of disputes.
    (b) Each Council may advise and assist the lead agency and the State 
educational agency regarding the provision of appropriate services for 
children aged birth to five, inclusive.
    (c) Each Council may advise appropriate agencies in the State with 
respect to the integration of services for infants and toddlers with 
disabilities and at-risk infants and toddlers and

[[Page 216]]

their families, regardless of whether at-risk infants and toddlers are 
eligible for early intervention services in the State.

(Approved by the Office of Management and Budget under control number 
1820-0550)

(Authority: 20 U.S.C. 1441(e)(1)(A) and (e)(2))

[58 FR 40959, July 30, 1993, as amended at 63 FR 18296, Apr. 14, 1998]



Sec. 303.651  Advising and assisting the lead agency in its administrative 
duties.

    Each Council shall advise and assist the lead agency in the--
    (a) Identification of sources of fiscal and other support for 
services for early intervention programs under this part;
    (b) Assignment of financial responsibility to the appropriate 
agency; and
    (c) Promotion of the interagency agreements under Sec. 303.523.

(Approved by the Office of Management and Budget under control number 
1820-0550)

(Authority: 20 U.S.C. 1441(e)(1)(A))



Sec. 303.652  Applications.

    Each Council shall advise and assist the lead agency in the 
preparation of applications under this part and amendments to those 
applications.

(Approved by the Office of Management and Budget under control number 
1820-0550)

(Authority: 20 U.S.C. 1441(e)(1)(B))



Sec. 303.653  Transitional services.

    Each Council shall advise and assist the State educational agency 
regarding the transition of toddlers with disabilities to services 
provided under part B of the Act, to preschool and other appropriate 
services.

(Approved by the Office of Management and Budget under control number 
1820-0578)

(Authority: 20 U.S.C. 1441(e)(1)(C))

[58 FR 40959, July 30, 1993, as amended at 63 FR 18296, Apr. 14, 1998]



Sec. 303.654  Annual report to the Secretary.

    (a) Each Council shall--
    (1) Prepare an annual report to the Governor and to the Secretary on 
the status of early intervention programs operated within the State for 
children eligible under this part and their families; and
    (2) Submit the report to the Secretary by a date that the Secretary 
establishes.
    (b) Each annual report must contain the information required by the 
Secretary for the year for which the report is made.

(Approved by the Office of Management and Budget under control number 
1820-0550)

(Authority: 20 U.S.C. 1441(e)(1)(D))



PART 304_SPECIAL EDUCATION_PERSONNEL PREPARATION TO IMPROVE SERVICES AND 
RESULTS FOR CHILDREN WITH DISABILITIES--Table of Contents




                            Subpart A_General

Sec.
304.1 Purpose.
304.2 What is the Special Education--Personnel Preparation to Improve 
          Services and Results for Children with Disabilities Program?
304.3 What definitions apply to this program?
304.4 What regulations apply to this program?

          Subpart B_What Conditions Must Be Met By the Grantee?

304.20 What are the requirements for directing grant funds?
304.21 What are allowable costs?
304.22 What are the requirements for grantees in disbursing 
          scholarships?
304.23 What assurances must be provided by a grantee that intends to 
          provide scholarships?

          Subpart C_What Conditions Must Be Met By the Scholar?

304.30 What are the requirements for scholars?
304.31 What are the requirements for obtaining a deferral or exception 
          to performance or repayment under an agreement?
304.32 What are the consequences of a scholar's failure to meet the 
          terms and conditions of a scholarship agreement?

    Authority: 20 U.S.C. 1473, unless otherwise noted.

    Source: 64 FR 69144, Dec. 9, 1999, unless otherwise noted.

[[Page 217]]



                            Subpart A_General



Sec. 304.1  Purpose.

    Individuals who receive scholarship assistance from projects funded 
under the Special Education--Personnel Preparation to Improve Services 
and Results for Children with Disabilities program are required to 
complete a service obligation, or repay all or part of the costs of such 
assistance, in accordance with section 673(h) of the Individuals with 
Disabilities Education Act and the regulations of this part.

(Authority: 20 U.S.C. 1473(h))



Sec. 304.2  What is the Special Education--Personnel Preparation to 
Improve Services and Results for Children with Disabilities Program?

    The Special Education--Personnel Preparation to Improve Services and 
Results for Children with Disabilities Program (program) provides 
financial assistance under section 673 of the Act to--
    (a) Help address State-identified needs for qualified personnel in 
special education, related services, early intervention, and regular 
education, to work with children with disabilities; and
    (b) Ensure that those personnel have the skills and knowledge, 
derived from practices that have been determined, through research and 
experience, to be successful, that are needed to serve those children.

(Authority: 20 U.S.C. 1473(a))



Sec. 304.3  What definitions apply to this program?

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

Applicant
Award
Department
EDGAR
Grantee
Project
Recipient
Secretary

    (b) The following definitions apply to this program:
    Academic year means--
    (1) A full-time course of study--
    (i) Taken for a period totaling at least nine months; or
    (ii) Taken for the equivalent of at least two semesters, two 
trimesters, or three quarters; or
    (2) For a part-time student, the accumulation of periods of part-
time courses of study that is equivalent to an ``academic year'' under 
paragraph (b)(1) of this section.
    Act means the Individuals with Disabilities Education Act, 20 U.S.C. 
1400 et seq.
    Early intervention services means early intervention services as 
defined in section 632(4) of the Act.
    Full-time, for purposes of determining whether an individual is 
employed full-time in accordance with Sec. 304.23, means a full-time 
position as defined by the individual's employer or by the agencies 
served by the individual.
    Payback means monetary repayment of scholarship assistance in lieu 
of completion of a service obligation.
    Related services means related services as defined in section 
602(22) of the Act.
    Scholar means an individual who is pursuing a degree, license, 
endorsement, or certification related to special education, related 
services, or early intervention services and who receives scholarship 
assistance under this part.
    Scholarship means financial assistance to a scholar for training 
under the program and includes all disbursements or credits for tuition, 
fees, student stipends, and books, and travel in conjunction with 
training assignments.
    Service obligation means a scholar's employment obligation, as 
described in section 673(h) of the Act and Sec. 304.23(b).
    Special education means special education as defined in section 
602(25) of the Act.

(Authority: 20 U.S.C. 1473(h))



Sec. 304.4  What regulations apply to this program?

    The following regulations apply to this program:
    (a) The Education Department General Administrative Regulations 
(EDGAR) in the following parts of title 34 of the Code of Federal 
Regulations:
    (1) Part 74 (Administration of Grants to Institutions of Higher 
Education,

[[Page 218]]

Hospitals, and Nonprofit Organizations).
    (2) Part 75 (Direct Grant Programs).
    (3) Part 77 (Definitions That Apply to Department Regulations).
    (4) Part 79 (Intergovernmental Review of Department of Education 
Programs and Activities).
    (5) Part 80 (Uniform Administrative Requirements for Grants and 
Cooperative Agreements to State and Local Governments).
    (6) Part 81 (General Education Provisions Act--Enforcement).
    (7) Part 82 (New Restrictions on Lobbying).
    (8) Part 85 (Governmentwide Debarment and Suspension 
(Nonprocurement) and Governmentwide Requirements for Drug-Free Workplace 
(Grants)).
    (9) Part 86 (Drug-Free Schools and Campuses).
    (10) Part 97 (Protection of Human Subjects).
    (11) Part 98 (Student Rights in Research, Experimental Programs and 
Testing).
    (12) Part 99 (Family Educational Rights and Privacy).
    (b) The regulations in this part 304.

(Authority: 20 U.S.C. 1473; 20 U.S.C. 3474(a))



          Subpart B_What Conditions Must Be Met By the Grantee?



Sec. 304.20  What are the requirements for directing grant funds?

    (a) The Secretary, as appropriate, identifies in a notice published 
in the Federal Register, the percentage (up to 75 percent) of a total 
award under the program that must be used to support scholarships as 
defined in Sec. 304.3.
    (b) The Secretary may award a grant that uses a percentage for 
scholarships, as determined by the Secretary, that is lower than that 
published under paragraph (a) of this section in exceptional 
circumstances if the Secretary determines that such an exception is 
necessary to achieve the purposes of the program.

(Authority: 20 U.S.C. 1473(h))



Sec. 304.21  What are allowable costs?

    In addition to the allowable costs established in the Education 
Department General Administrative Regulations in 34 CFR 75.530 through 
75.562, the following items are allowable expenditures by projects 
funded under the program:
    (a) Tuition and fees.
    (b) Student stipends and books.
    (c) Travel in conjunction with training assignments.

(Authority: 20 U.S.C. 1473(h))



Sec. 304.22  What are the requirements for grantees in disbursing 
scholarships?

    Before disbursement of scholarship assistance to an individual, a 
grantee must--
    (a) Ensure that the scholar--
    (1) Is a citizen or national of the United States;
    (2) Is a permanent resident of--
    (i) Puerto Rico, the United States Virgin Islands, Guam, American 
Samoa, or the Commonwealth of the Northern Mariana Islands; or
    (ii) The Republic of the Marshall Islands, the Federated States of 
Micronesia, or the Republic of Palau (during the period in which these 
entities are eligible to receive an award under the program); or
    (3) Provides evidence from the U.S. Immigration and Naturalization 
Service that the individual is--
    (i) A lawful permanent resident of the United States; or
    (ii) In the United States for other than a temporary purpose with 
the intention of becoming a citizen or permanent resident.
    (b) Limit scholarship assistance to the amount by which the 
individual's cost of attendance at the institution exceeds the amount of 
grant assistance the scholar is to receive for the same academic year 
under Title IV of the Higher Education Act; and
    (c) Obtain a Certification of Eligibility for Federal Assistance 
from each scholar, as prescribed in 34 CFR 75.60, 75.61, and 75.62.

(Approved by the Office of Management and Budget under control number 
1820-0622)

(Authority: 20 U.S.C. 1473)

[[Page 219]]



Sec. 304.23  What assurances must be provided by a grantee that 
intends to provide scholarships?

    Before receiving an award, a grantee that intends to grant 
scholarships under the program must assure that the following 
requirements will be satisfied:
    (a) Requirement for agreement. Each scholar who will receive a 
scholarship must first enter into a written agreement with the grantee 
that contains the terms and conditions required by this section.
    (b) Terms of the agreement. Each agreement under paragraph (a) of 
this section must contain, at a minimum, the following provisions:
    (1) Individuals who receive scholarship assistance from projects 
funded under section 673(b) and (e), and to the extent determined 
appropriate by the Secretary, section 673(d), of the Act will 
subsequently maintain employment--
    (i) In which the individual provides special education or related 
services to children with disabilities or early intervention services to 
infants and toddlers, and their families;
    (ii) On a full-time or full-time equivalent basis; and
    (iii) For a period of at least two years for every academic year for 
which assistance was received.
    (2) In order to meet the requirements of paragraph (b)(1) of this 
section, an individual must be employed in a position in which--
    (i) A majority of the persons to whom the individual provides 
services are receiving from the individual special education, related 
services, or early intervention services; or
    (ii) The individual spends a majority of his or her time providing 
special education or related services to children with disabilities or 
early intervention services to infants and toddlers with disabilities.
    (3) Individuals who receive scholarship assistance from a leadership 
preparation project funded under section 673(c) of the Act will 
subsequently maintain employment--
    (i) In which the individual expends a majority of his or her time 
performing work related to the individual's preparation;
    (ii) On a full-time or full-time equivalent basis; and
    (iii) For a period of at least two years for every academic year for 
which assistance was received.
    (4) A scholarship recipient must complete the service obligation 
under paragraph (b)(1)(iii) or (b)(3)(iii) of this section within the 
period ending not more than the sum of the number of years required in 
paragraph (b)(1)(iii) or (b)(3)(iii) of this section, as appropriate, 
plus three additional years, from the date the recipient completes the 
training for which the scholarship assistance was awarded.
    (5) Employment that meets the requirements of paragraph (b) of this 
section, and is performed by a scholar subsequent to the completion of 
one academic year of the training for which the scholarship assistance 
was received, can be used to meet, in part, the period of the scholar's 
service obligation under paragraph (b)(1)(iii) or (b)(3)(iii) of this 
section.
    (6) The service obligation in paragraph (b) of this section, as 
applied to a part-time scholar, is based on the accumulated academic 
years of training for which the scholarship is received.
    (c) Repayment. (1) Subject to the provisions in Sec. 304.31 
regarding a deferral or exception, a scholar who does not fulfill the 
requirements in paragraph (b)(1) or (b)(3) of this section, as 
appropriate, must repay all or part of any scholarship received, plus 
interest.
    (2) The amount of the scholarship that has not been retired through 
eligible service will constitute a debt owed to the United States that--
    (i) Will be repaid by the scholar in accordance with Sec. 304.32; 
and
    (ii) May be collected by the Secretary in accordance with 34 CFR 
part 30, in the case of the scholar's failure to meet the obligation of 
Sec. 304.32.
    (d) Standards for satisfactory progress. The grantee must establish, 
notify students of, and apply reasonable standards for measuring whether 
a scholar is maintaining satisfactory progress in the scholar's course 
of study;
    (e) Compliance. The grantee must establish policies and procedures 
to determine compliance of scholars with the terms of the written 
agreement developed under this section;

[[Page 220]]

    (f) Exit certification. The grantee must establish policies and 
procedures for receiving written certification from scholars at the time 
of exit from the program that identifies--
    (1) The number of years the scholar needs to work to satisfy the 
work requirements in paragraph (b) of this section.
    (2) The total amount of scholarship assistance received subject to 
the work-or-repay provision in paragraph (b) of this section.
    (3) The time period, consistent with paragraph (b)(1)(iii) or 
(b)(3)(iii) of this section, during which the scholar must satisfy the 
work requirements in paragraph (b) of this section.
    (4) All other obligations of the scholar under this section.
    (g) Information. The grantee must provide, upon request of the 
Secretary, information, including records maintained under paragraphs 
(e) and (f) of this section, that is necessary to carry out the 
Secretary's functions under this part.
    (h) Records. The grantee must maintain the information under this 
section related to a scholar for a period of time equal to the time 
required to fulfill the obligation under paragraph (b) of this section.
    (i) Notification. The grantee must inform the Secretary if a scholar 
fails to fulfill or chooses not to fulfill the obligation under 
paragraph (b)(1) or (b)(3) of this section.

(Approved by the Office of Management and Budget under control number 
1820-0622)

(Authority: 20 U.S.C. 1473(h))



          Subpart C_What Conditions Must Be Met By the Scholar?



Sec. 304.30  What are the requirements for scholars?

    A scholar must--
    (a) Be enrolled in a course of study leading to a degree, 
certificate, endorsement, or license related to special education, 
related services, or early intervention services in order to be eligible 
to receive a scholarship under the program;
    (b) Enter into a written agreement with the grantee that meets the 
terms and conditions of Sec. 304.23 of this part before starting 
training;
    (c) Receive the training at the educational institution or agency 
designated in the scholarship;
    (d) Not accept payment of educational allowances from any other 
entity if that allowance conflicts with the scholar's obligation under 
this part;
    (e) Maintain satisfactory progress toward the degree, certificate, 
endorsement, or license as determined by the grantee;
    (f) Provide the grantee all requested information necessary to 
determine the scholar's progress in meeting the service obligation under 
Sec. 304.23(b); and
    (g) Notify the grantee of changes in address, employment setting, or 
employment status during the period of the scholar's service obligation 
under Sec. 304.23(b).

(Approved by the Office of Management and Budget under control number 
1820-0622)

(Authority: 20 U.S.C. 1473(h))



Sec. 304.31  What are the requirements for obtaining a deferral or 
exception to performance or repayment under an agreement?

    (a) An exception to the repayment requirement in Sec. 304.23(c) may 
be granted, in whole or part, if the scholar--
    (1) Is unable to continue the course of study or perform the service 
obligation because of a disability that is expected to continue 
indefinitely; or
    (2) Has died.
    (b) Deferral of the repayment requirement in Sec. 304.23(c) may be 
granted during the time the scholar--
    (1) Is engaging in a full-time course of study at an institution of 
higher education;
    (2) Is serving, not in excess of three years, on active duty as a 
member of the armed services of the United States;
    (3) Is serving as a volunteer under the Peace Corps Act;
    (4) Is serving as a full-time volunteer under Title I of the 
Domestic Volunteer Service Act of 1973;
    (5) Has a disability which prevents the individual from working, for 
a period not to exceed three years; or
    (6) Is unable to secure employment as required by the agreement by 
reason of

[[Page 221]]

the care provided to a disabled family member for a period not to exceed 
12 months.
    (c) Deferrals or exceptions to performance or repayment may be 
provided by grantees based upon sufficient evidence to substantiate the 
grounds for an exception under paragraph (a) of this section or a 
deferral under paragraph (b) of this section.

(Approved by the Office of Management and Budget under control number 
1820-0622)

(Authority: 20 U.S.C. 1473(h))



Sec. 304.32  What are the consequences of a scholar's failure to meet 
the terms and conditions of a scholarship agreement?

    If a scholar fails to meet the terms and conditions of a scholarship 
agreement under Sec. 304.23(b) or to obtain a deferral or an exception 
as provided in Sec. 304.31, the scholar must repay all or part of the 
scholarship assistance to the Secretary as follows:
    (a) Amount. The amount of the scholarship to be repaid is 
proportional to the service obligation not completed.
    (b) Interest Rate. The Secretary charges the scholar interest on the 
unpaid balance owed in accordance with 31 U.S.C. 3717.
    (c) Interest accrual. (1) Interest on the unpaid balance accrues 
from the date the scholar is determined to have entered repayment status 
under paragraph (e) of this section.
    (2) Any accrued interest is capitalized at the time the scholar's 
repayment schedule is established.
    (3) No interest is charged for the period of time during which 
repayment has been deferred under Sec. 304.31.
    (d) Collection costs. Under the authority of 31 U.S.C. 3717, the 
Secretary may impose reasonable collection costs.
    (e) Repayment status. A scholar enters repayment status on the first 
day of the first calendar month after the earliest of the following 
dates, as applicable:
    (1) The date the scholar informs the grantee that he or she does not 
plan to fulfill the service obligation under the agreement.
    (2) Any date when the scholar's failure to begin or maintain 
employment makes it impossible for that individual to complete the 
service obligation within the number of years required in Sec. 
304.23(b).
    (3) Any date on which the scholar discontinues enrollment in the 
course of study under Sec. 304.30(a).
    (f) Amounts and frequency of payment. The scholar must make payments 
to the Secretary that cover principal, interest, and collection costs 
according to a schedule established by the Secretary.

(Approved by the Office of Management and Budget under control number 
1820-0622)

(Authority: 20 U.S.C. 1473(h))



PART 350_DISABILITY AND REHABILITATION RESEARCH PROJECTS AND CENTERS 
PROGRAM--Table of Contents




                            Subpart A_General

Sec.
350.1 What is the Disability and Rehabilitation Research Projects and 
          Centers Program?
350.2 What is the purpose of the Disability and Rehabilitation Research 
          Project and Centers Program?
350.3 Who is eligible for an award?
350.4 What regulations apply?
350.5 What definitions apply?

           Subpart B_What Projects Does the Secretary Assist?

350.10 What are the general requirements for Disability and 
          Rehabilitation Research Projects?
350.11 What are the general requirements for a Field-Initiated Project?
350.12 What are the general requirements for an Advanced Rehabilitation 
          Research Training Project?
350.13 What must a grantee do in carrying out a research activity?
350.14 What must a grantee do in carrying out a training activity?
350.15 What must a grantee do in carrying out a demonstration activity?
350.16 What must a grantee do in carrying out a development activity?
350.17 What must a grantee do in carrying out a utilization activity?
350.18 What must a grantee do in carrying out a dissemination activity?

[[Page 222]]

350.19 What must a grantee do in carrying out a technical assistance 
          activity?

  Subpart C_What Rehabilitation Research and Training Centers Does the 
                            Secretary Assist?

350.20 What general requirements must a Rehabilitation Research and 
          Training Center meet?
350.21 What collaboration must a Rehabilitation Research and Training 
          Center engage in?
350.22 What activities must a Rehabilitation Research and Training 
          Center conduct?
350.23 What restriction exists on Rehabilitation Research and Training 
          Centers regarding indirect costs?

  Subpart D_What Rehabilitation Engineering Research Centers Does the 
                            Secretary Assist?

350.30 What requirements must a Rehabilitation Engineering Research 
          Center meet?
350.31 What collaboration must a Rehabilitation Engineering Research 
          Center engage in?
350.32 What activities must a Rehabilitation Engineering Research Center 
          conduct?
350.33 What cooperation requirements must a Rehabilitation Engineering 
          Research Center meet?
350.34 Which Rehabilitation Engineering Research Centers must have an 
          advisory committee?
350.35 What are the requirements for the composition of an advisory 
          committee?

               Subpart E_How Does One Apply for an Award?

350.40 What is required of each applicant regarding the needs of 
          individuals with disabilities from minority backgrounds?
350.41 What State agency review must an applicant under the Disability 
          and Rehabilitation Research Projects and Centers Program 
          obtain?

             Subpart F_How Does the Secretary Make an Award?

350.50 What is the peer review process for this Program?
350.51 What is the purpose of peer review?
350.52 What is the composition of a peer review panel?
350.53 How does the Secretary evaluate an application?
350.54 What selection criteria does the Secretary use in evaluating an 
          application?
350.55 What are the additional considerations for selecting Field-
          Initiated Project applications for funding?

          Subpart G_What Conditions Must Be Met After an Award?

350.60 How must a grantee conduct activities?
350.61 What evaluation requirements must a grantee meet?
350.62 What are the matching requirements?
350.63 What are the requirements of a grantee relative to the Client 
          Assistance Program?
350.64 What is the required duration of the training in an Advanced 
          Rehabilitation Research Training Project?
350.65 What level of participation is required of trainees in an 
          Advanced Rehabilitation Research Training Project?
350.66 What must a grantee include in a patent application?

    Authority: Sec. 204; 29 U.S.C. 761-762, unless otherwise noted.

    Source: 62 FR 5713, Feb. 6, 1997, unless otherwise noted.



                            Subpart A_General



Sec. 350.1  What is the Disability and Rehabilitation Research Projects 
and Centers Program?

    The Disability and Rehabilitation Research Projects and Centers 
Program provides grants to establish and support--
    (a) The following Disability and Rehabilitation Research and Related 
Projects:
    (1) Disability and Rehabilitation Research Projects.
    (2) Field-Initiated Projects.
    (3) Advanced Rehabilitation Research Training Projects; and
    (b) The following Disability and Rehabilitation Research Centers:
    (1) Rehabilitation Research and Training Centers.
    (2) Rehabilitation Engineering Research Centers.

(Authority: Sec. 204; 29 U.S.C. 762)

[[Page 223]]



Sec. 350.2  What is the purpose of the Disability and Rehabilitation 
Research Project and Centers Program?

    The purpose of the Disability and Rehabilitation Research Project 
and Centers Program is to plan and conduct research, demonstration 
projects, training, and related activities, including international 
activities, to--
    (a) Develop methods, procedures, and rehabilitation technology, that 
maximize the full inclusion and integration into society, employment, 
independent living, family support, and economic and social self-
sufficiency of individuals with disabilities, especially individuals 
with the most severe disabilities; and
    (b) Improve the effectiveness of services authorized under the Act.

(Authority: Secs. 204(a) and (b)(6); 29 U.S.C. 762(a) and (b)(6))



Sec. 350.3  Who is eligible for an award?

    The following entities are eligible for an award under this program:
    (a) States.
    (b) Public or private agencies, including for-profit agencies.
    (c) Public or private organizations, including for-profit 
organizations.
    (d) Institutions of higher education.
    (e) Indian tribes and tribal organizations.

(Authority: Sec. 204(a); 29 U.S.C. 762(a))



Sec. 350.4  What regulations apply?

    The following regulations apply to the Disability and Rehabilitation 
Research Projects and Centers Program:
    (a) The Education Department General Administrative Regulations 
(EDGAR) as follows:
    (1) 34 CFR part 74 (Administration of Grants and Agreements with 
Institutions of Higher Education, Hospitals, and Other Non-profit 
Organizations).
    (2) 34 CFR part 75 (Direct Grant Programs).
    (3) 34 CFR part 77 (Definitions that Apply to Department 
Regulations).
    (4) 34 CFR part 80 (Uniform Administrative Requirements for Grants 
and Cooperative Agreements to State and Local Governments).
    (5) 34 CFR part 81 (General Education Provisions Act--Enforcement).
    (6) 34 CFR part 82 (New Restrictions on Lobbying).
    (7) 34 CFR part 85 (Governmentwide Debarment and Suspension 
(Nonprocurement) and Governmentwide Requirements for Drug-Free Workplace 
(Grants)).
    (8) 34 CFR part 86 (Drug-Free Schools and Campuses).
    (b) The regulations in this part 350.
    (c)(1) Subject to the additional requirement in paragraph (c)(2) of 
this section, 34 CFR part 97 (Protection of Human Subjects).
    (2) If an institutional review board (IRB) reviews research that 
purposefully requires inclusion of children with disabilities or 
individuals with mental disabilities as research subjects, the IRB must 
have at least one member who is primarily concerned with the welfare of 
these research subjects.

(Authority: 29 U.S.C. 761a, 762, 42 U.S.C. 300v-1(b))



Sec. 350.5  What definitions apply?

    (a) The following definitions in 34 CFR part 77 apply to this part--

Applicant
Application
Award
Budget
Department
EDGAR
Equipment
Facilities
Grant
Grantee
Nonprofit
Private
Project
Project period
Public
Recipient
Secretary
Supplies
State


(Authority: Sec. 202(i)(1); 29 U.S.C. 761a(i)(1))

    (b) The following definitions also apply to this part.
    Act means the Rehabilitation Act of 1973 (29 U.S.C. 701, et seq.), 
as amended.


(Authority: Sec. 202(i)(1); (29 U.S.C. 761a(i)(1))

    Assistive technology device means any item, piece of equipment, or 
product

[[Page 224]]

system, whether acquired commercially or off the shelf, modified, or 
customized, that is used to increase, maintain, or improve functional 
capabilities of individuals with disabilities.


(Authority: Sec. 7(23); 29 U.S.C. 706(23))

    Assistive technology service means any service that directly assists 
an individual with a disability in the selection, acquisition, or use of 
an assistive technology device, including--
    (1) The evaluation of the needs of an individual with a disability, 
including a functional evaluation of the individual in the individual's 
customary environment;
    (2) Purchasing, leasing, or otherwise providing for the acquisition 
of assistive technology devices by individuals with disabilities;
    (3) Selecting, designing, fitting, customizing, adapting, applying, 
maintaining, repairing, or replacing assistive technology devices;
    (4) Coordinating and using other therapies, interventions, or 
services with assistive technology devices, such as those associated 
with existing education and rehabilitation plans and programs;
    (5) Training or technical assistance for individuals with 
disabilities, or, if appropriate, their family members, guardians, 
advocates, or authorized representatives; and
    (6) Training or technical assistance for professionals (including 
individuals providing education and rehabilitation services), employers, 
or other individuals who provide services to employ, or are otherwise 
substantially involved in the major life functions of, individuals with 
disabilities.


(Authority: Sec. 7(24); 29 U.S.C. 706(24))

    Disability means a physical or mental impairment that substantially 
limits one or more major life activities.


(Authority: Sec. 202(i)(1); 29 U.S.C. 761a(i)(1))

    Individual with a disability means any individual who:
    (1) Has a physical or mental impairment that substantially limits 
one or more of the individual's major life activities;
    (2) Has a record of this impairment; or
    (3) Is regarded as having this impairment.


(Authority: Sec. 7(8)(B); 29 U.S.C. 706(8)(B))

    Individual with a severe disability means--
    (1)(i) An individual with a disability who has a severe physical or 
mental impairment that seriously limits one or more functional 
capacities (such as mobility, communication, self-care, self-direction, 
interpersonal skills, work tolerance, or work skills) in terms of an 
employment outcome;
    (ii) Whose vocational rehabilitation can be expected to require 
multiple vocational rehabilitation services over an extended period of 
time; and
    (iii) Who has one or more physical or mental disabilities resulting 
from amputation, arthritis, autism, blindness, burn injury, cancer, 
cerebral palsy, cystic fibrosis, deafness, head injury, heart disease, 
hemiplegia, hemophilia, respiratory or pulmonary dysfunction, mental 
retardation, mental illness, multiple sclerosis, muscular dystrophy, 
musculoskeletal disorders, neurological disorders (including stroke and 
epilepsy), paraplegia, quadriplegia, other spinal cord impairments, 
sickle cell anemia, specific learning disability, end-stage renal 
disease, or another disability or combination of disabilities determined 
on the basis of an assessment of rehabilitation needs to cause 
comparable substantial functional limitation; or
    (2) An individual with a severe mental or physical impairment whose 
ability to function independently in the family or community or whose 
ability to obtain, maintain, or advance in employment is substantially 
limited and for whom the delivery of independent living services will 
improve the ability to function, continue functioning, or move towards 
functioning independently in the family or community or to continue in 
employment, respectively.


(Authority: Sec. 7(15)(C); 29 U.S.C. 706(15)(C))

    Personal assistance services means a range of services, provided by 
one or more persons, designed to assist an individual with a disability 
to perform daily living activities, on and off the

[[Page 225]]

job, that the individual would typically perform if the individual did 
not have a disability. These services must be designed to increase the 
individual's control in life and ability to perform everyday activities 
on and off the job.


(Authority: Sec. 12(c); 29 U.S.C. 711(c))

    Rehabilitation technology means the systematic application of 
technologies, engineering methodologies, or scientific principles to 
meet the needs of and address the barriers confronted by individuals 
with disabilities in such areas as education, rehabilitation, 
employment, transportation, independent living, and recreation, and 
includes rehabilitation engineering, assistive technology devices, and 
assistive technology services.

(Authority: Sec. 7(13); 29 U.S.C. 706(13))

    Research is classified on a continuum from basic to applied:
    (1) Basic research is research in which the investigator is 
concerned primarily with gaining new knowledge or understanding of a 
subject without reference to any immediate application or utility.
    (2) Applied research is research in which the investigator is 
primarily interested in developing new knowledge, information or 
understanding which can be applied to a predetermined rehabilitation 
problem or need. Applied research builds on selected findings from basic 
research.

(Authority: Sec. 202(i)(1); 29 U.S.C. 761a(i)(1))

    State rehabilitation agency means the sole State agency designated 
to administer (or supervise local administration of) the State plan for 
vocational rehabilitation services. The term includes the State agency 
for the blind, if designated as the State agency with respect to that 
part of the plan relating to the vocational rehabilitation of blind 
individuals.

(Authority: Sec. 101(a)(1)(A); 29 U.S.C. 721(a)(1)(A))

    Target population means the group of individuals, organizations, or 
other entities expected to be affected by the project. More than one 
group may be involved since a project may affect those who receive 
services, provide services, or administer services.

(Authority: Sec. 202(i)(1); 29 U.S.C. 761a(i)(1))



           Subpart B_What Projects Does the Secretary Assist?



Sec. 350.10  What are the general requirements for Disability and 
Rehabilitation Research Projects?

    Disability and Rehabilitation Research Projects must meet the 
following requirements:
    (a) Carry out one or more of the following types of activities, as 
specified in Sec. Sec. 350.13-350.19:
    (1) Research.
    (2) Development.
    (3) Demonstration.
    (4) Training.
    (5) Dissemination.
    (6) Utilization.
    (7) Technical assistance.
    (b) Further one or more of the purposes listed in Sec. 350.2.

(Authority: Sec. 202; 29 U.S.C. 761a)



Sec. 350.11  What are the general requirements for a Field-Initiated 
Project?

    A Field-Initiated Project must--
    (a) Further one or more of the purposes in Sec. 350.2; and
    (b) Carry out one of the following types of activities:
    (1) Research.
    (2) Development.

(Authority: Sec. 202; 29 U.S.C. 761a)



Sec. 350.12  What are the general requirements for an Advanced 
Rehabilitation Research Training Project?

    An Advanced Rehabilitation Research Training Project must--
    (a) Provide research training and experience at an advanced level to 
individuals with doctorates or similar advanced degrees who have 
clinical or other relevant experience;
    (b) Further one or more of the purposes in Sec. 350.2; and
    (c) Carry out all of the following activities:
    (1) Recruitment and selection of candidates for advanced research 
training.
    (2) Provision of a training program that includes didactic and 
classroom instruction, is multidisciplinary, and emphasizes scientific 
methodology, and

[[Page 226]]

may involve collaboration among institutions.
    (3) Provision of research experience, laboratory experience or its 
equivalent in a community-based research setting, and a practicum that 
involve each individual in clinical research and in practical activities 
with organizations representing individuals with disabilities.
    (4) Provision of academic mentorship or guidance, and opportunities 
for scientific collaboration with qualified researchers at the host 
university and other appropriate institutions.
    (5) Provision of opportunities for participation in the development 
of professional presentations and publications, and for attendance at 
professional conferences and meetings as appropriate for the 
individual's field of study and level of experience.

(Authority: Sec. 202(k); 29 U.S.C. 761a(k))



Sec. 350.13  What must a grantee do in carrying out a research activity?

    In carrying out a research activity under this program, a grantee 
shall--
    (a) Identify one or more hypotheses; and
    (b) Based on the hypotheses identified, perform an intensive 
systematic study directed toward--
    (1) New or full scientific knowledge; or
    (2) Understanding of the subject or problem studied.

(Authority: Sec. 202; 29 U.S.C. 761a)



Sec. 350.14  What must a grantee do in carrying out a training activity?

    In carrying out a training activity under this program, a grantee 
shall conduct a planned and systematic sequence of supervised 
instruction that is designed to impart predetermined skills and 
knowledge.

(Authority: Sec. 202; 29 U.S.C. 761a)



Sec. 350.15  What must a grantee do in carrying out a demonstration 
activity?

    In carrying out a demonstration activity under this program, a 
grantee shall apply results derived from previous research, testing, or 
practice to determine the effectiveness of a new strategy or approach.

(Authority: Sec. 202; 29 U.S.C. 761a)



Sec. 350.16  What must a grantee do in carrying out a development activity?

    In carrying out a development activity under this program, a grantee 
must use knowledge and understanding gained from research to create 
materials, devices, systems, or methods beneficial to the target 
population, including design and development of prototypes and 
processes.

(Authority: Sec. 202; 29 U.S.C. 761a)



Sec. 350.17  What must a grantee do in carrying out a utilization activity?

    In carrying out a utilization activity under this program, a grantee 
must relate research findings to practical applications in planning, 
policy making, program administration, and delivery of services to 
individuals with disabilities.

(Authority: Sec. 202; 29 U.S.C. 761a)



Sec. 350.18  What must a grantee do in carrying out a dissemination 
activity?

    In carrying out a dissemination activity under this program, a 
grantee must systematically distribute information or knowledge through 
a variety of ways to potential users or beneficiaries.

(Authority: Sec. 202; 29 U.S.C. 761a)



Sec. 350.19  What must a grantee do in carrying out a technical 
assistance activity?

    In carrying out a technical assistance activity under this program, 
a grantee must provide expertise or information for use in problem-
solving.

(Authority: Sec. 202; 29 U.S.C. 761a)



  Subpart C_What Rehabilitation Research and Training Centers Does the 
                            Secretary Assist?



Sec. 350.20  What general requirements must a Rehabilitation Research 
and Training Center meet?

    A Rehabilitation Research and Training Center shall--
    (a) Plan and conduct activities that further one or more of the 
purposes listed in Sec. 350.2;

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    (b) Serve as a center of national excellence and as a national or 
regional resource for providers and individuals with disabilities and 
the parents, family members, guardians, advocates, or authorized 
representatives of the individuals;
    (c) Be of sufficient size, scope, and quality to effectively carry 
out the activities in an efficient manner consistent with appropriate 
State and Federal law; and
    (d) Be able to carry out training activities either directly or 
through another entity that can provide such training.

(Authority: Secs. 204(b) and (b)(2)(K); 29 U.S.C. 762(b) and (b)(2)(K))



Sec. 350.21  What collaboration must a Rehabilitation Research and 
Training Center engage in?

    A Rehabilitation Research and Training Center must be operated by or 
in collaboration with--
    (a) One or more institutions of higher education; or
    (b) One or more providers of rehabilitation or other appropriate 
services.

(Authority: Sec. 204(b)(2); 29 U.S.C. 762(b)(2))



Sec. 350.22  What activities must a Rehabilitation Research and Training 
Center conduct?

    A Rehabilitation Research and Training Center shall--
    (a) Carry out research activities by conducting coordinated and 
advanced programs of research in rehabilitation targeted toward the 
production of new knowledge that will--
    (1) Improve rehabilitation methodology and service delivery systems;
    (2) Alleviate or stabilize disabling conditions; and
    (3) Promote maximum social and economic independence of individuals 
with disabilities;
    (b) Conduct training activities by providing training (including 
graduate, pre-service, and in-service training) to assist--
    (1) Rehabilitation personnel and other individuals to more 
effectively provide rehabilitation services; and
    (2) Rehabilitation research personnel and other rehabilitation 
personnel to improve their capacity to conduct research; and
    (c) Conduct technical assistance activities by serving as an 
informational and technical assistance resource for providers, 
individuals with disabilities, and the parents, family members, 
guardians, advocates, or authorized representatives of the individuals 
with disabilities, through conferences, workshops, public education 
programs, in-service training programs, and similar activities.



Sec. 350.23  What restriction exists on Rehabilitation Research and 
Training Centers regarding indirect costs?

    A host institution with which a Rehabilitation Research and Training 
Center is affiliated may not collect more than fifteen percent of the 
total grant award as indirect cost charges, notwithstanding the 
provisions in 34 CFR 75.562.

(Authority: Sec. 204(b)(2)(O); 29 U.S.C. 762(b)(2)(O))



  Subpart D_What Rehabilitation Engineering Research Centers Does the 
                            Secretary Assist?



Sec. 350.30  What requirements must a Rehabilitation Engineering Research 
Center meet?

    A Rehabilitation Engineering Research Center shall plan and conduct 
activities that--
    (a) Further one or more of the purposes listed in Sec. 350.2; and
    (b)(1) Lead to the development of methods, procedures, and devices 
that will benefit individuals with disabilities, especially those with 
the most severe disabilities; or
    (2) Involve rehabilitation technology and enhance opportunities for 
meeting the needs of, and addressing the barriers confronted by, 
individuals with disabilities in all aspects of their lives.

(Authority: Sec. 204(b)(3); 29 U.S.C. 762(b)(3))



Sec. 350.31  What collaboration must a Rehabilitation Engineering 
Research Center engage in?

    A Rehabilitation Engineering Research Center must be operated by or 
in collaboration with--
    (a) One or more institutions of higher education; or

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    (b) One or more nonprofit organizations.

(Authority: Sec. 204(b)(3); 29 U.S.C. 762(b)(3))



Sec. 350.32  What activities must a Rehabilitation Engineering Research 
Center conduct?

    A Rehabilitation Engineering Research Center shall--
    (a) Conduct research or demonstration activities by using one or 
more of the following strategies:
    (1) Developing and disseminating innovative methods of applying 
advanced technology, scientific achievement, and psychological and 
social knowledge to solve rehabilitation problems and remove 
environmental barriers through--
    (i) Planning and conducting research, including cooperative research 
with public or private agencies and organizations, designed to produce 
new scientific knowledge and new or improved methods, equipment, or 
devices; and
    (ii) Studying and evaluating new or emerging technologies, products, 
or environments and their effectiveness and benefits.
    (2) Demonstrating and disseminating--
    (i) Innovative models for the delivery to rural and urban areas of 
cost-effective rehabilitation technology services that will promote the 
use of assistive technology services; and
    (ii) Other scientific research to assist in meeting the employment 
and independent living needs of individuals with severe disabilities.
    (3) Conducting research and demonstration activities that facilitate 
service delivery systems change by demonstrating, evaluating, 
documenting, and disseminating--
    (i) Consumer-responsive and individual and family-centered 
innovative models for the delivery, to both rural and urban areas, of 
innovative, cost-effective rehabilitation technology services that 
promote use of rehabilitation technology; and
    (ii) Other scientific research to assist in meeting the employment 
and independent living needs of, and addressing the barriers confronted 
by individuals with disabilities, including individuals with severe 
disabilities;
    (b) To the extent consistent with the nature and type of research or 
demonstration activities described in paragraph (a) of this section, 
carry out research, training, and information dissemination activities 
by--
    (1) Providing training opportunities to individuals, including 
individuals with disabilities, to enable them to become rehabilitation 
technology researchers and practitioners of rehabilitation technology in 
conjunction with institutions of higher education and nonprofit 
organizations; and
    (2) Responding, through research or demonstration activities, to the 
needs of individuals with all types of disabilities who may benefit from 
the application of technology within the subject area of focus of the 
Center.
    (c) Conduct orientation seminars for rehabilitation service 
personnel to improve the application of rehabilitation technology;
    (d) Conduct activities that specifically demonstrate means for 
utilizing rehabilitation technology; and
    (e) Provide technical assistance and consultation that are 
responsive to concerns of service providers and consumers.

(Authority: Sec. 204(b)(3); 29 U.S.C. 762(b)(3))



Sec. 350.33  What cooperation requirements must a Rehabilitation 
Engineering Research Center meet?

    A Rehabilitation Engineering Research Center--
    (a) Shall cooperate with State agencies and other local, State, 
regional, and national programs and organizations developing or 
delivering rehabilitation technology, including State programs funded 
under the Technology-Related Assistance for Individuals With 
Disabilities Act of 1988 (29 U.S.C. 2201 et seq.); and
    (b) To the extent consistent with the nature and type of research or 
demonstration activities described in Sec. 350.32(a), shall cooperate 
with the entities described in paragraph (a) of this section to provide 
information to individuals with disabilities and their parents, family 
members, guardians, advocates, or authorized representatives, to--

[[Page 229]]

    (1) Increase awareness and understanding of how rehabilitation 
technology can address their needs; and
    (2) Increase awareness and understanding of the range of options, 
programs, services, and resources available, including financing options 
for the technology and services covered by the subject area of focus of 
the Center.

(Authority: Sec. 204(b)(3) and (c); 29 U.S.C. 762(b)(3) and (c))



Sec. 350.34  Which Rehabilitation Engineering Research Centers must have 
an advisory committee?

    A Rehabilitation Engineering Research Center conducting research or 
demonstration activities that facilitate service delivery systems change 
must have an advisory committee.

(Authority: Sec. 204 (b)(3)(D); 29 U.S.C. 762 (b)(3)(D))



Sec. 350.35  What are the requirements for the composition of an 
advisory committee?

    The majority of a Rehabilitation Engineering Research Center 
advisory committee's members must be comprised of individuals with 
disabilities who are users of rehabilitation technology, or their 
parents, family members, guardians, advocates, or authorized 
representatives.

(Authority: Sec. 204(b)(3)(D); 29 U.S.C. 762(b)(3)(D))



               Subpart E_How Does One Apply for an Award?



Sec. 350.40  What is required of each applicant regarding the needs of 
individuals with disabilities from minority backgrounds?

    (a) Unless the Secretary indicates otherwise in a notice published 
in the Federal Register, an applicant for assistance under this program 
must demonstrate in its application how it will address, in whole or in 
part, the needs of individuals with disabilities from minority 
backgrounds.
    (b) The approaches an applicant may take to meet this requirement 
may include one or more of the following:
    (1) Proposing project objectives addressing the needs of individuals 
with disabilities from minority backgrounds.
    (2) Demonstrating that the project will address a problem that is of 
particular significance to individuals with disabilities from minority 
backgrounds.
    (3) Demonstrating that individuals from minority backgrounds will be 
included in study samples in sufficient numbers to generate information 
pertinent to individuals with disabilities from minority backgrounds.
    (4) Drawing study samples and program participant rosters from 
populations or areas that include individuals from minority backgrounds.
    (5) Providing outreach to individuals with disabilities from 
minority backgrounds to ensure that they are aware of rehabilitation 
services, clinical care, or training offered by the project.
    (6) Disseminating materials to or otherwise increasing the access to 
disability information among minority populations.

(Approved by the Office of Management and Budget under control number 
1820-0027)

(Authority: Sec. 21(b)(6); 29 U.S.C. 718b(b)(6))



Sec. 350.41  What State agency review must an applicant under the Disability 
and Rehabilitation Research Projects and Centers Program obtain?

    (a) An applicant that proposes to conduct research, demonstrations, 
or related activities that will either involve clients of the State 
vocational rehabilitation agency as research subjects or study 
vocational rehabilitation services or techniques under this program, 
shall follow the requirements in 34 CFR 75.155 through 75.159.
    (b) For the purposes of this Program, State as used in 34 CFR 75.155 
through 75.159 means the State rehabilitation agency or agencies in the 
primary State or States to be affected by the proposed activities.

(Authority: Secs. 204(c) and 306(i); 29 U.S.C. 762(c) and 766(a))

[[Page 230]]



             Subpart F_How Does the Secretary Make an Award?



Sec. 350.50  What is the peer review process for this Program?

    (a) The Secretary refers each application for a grant governed by 
those regulations in this part to a peer review panel established by the 
Secretary.
    (b) Peer review panels review applications on the basis of the 
applicable selection criteria in Sec. 350.54.

(Authority: Sec. 202(e); 29 U.S.C. 761a(e))



Sec. 350.51  What is the purpose of peer review?

    The purpose of peer review is to insure that--
    (a) Those activities supported by the National Institute on 
Disability and Rehabilitation Research (NIDRR) are of the highest 
scientific, administrative, and technical quality; and
    (b) Activity results may be widely applied to appropriate target 
populations and rehabilitation problems.

(Authority: Sec. 202(e); 29 U.S.C. 761a(e))



Sec. 350.52  What is the composition of a peer review panel?

    (a) The Secretary selects as members of a peer review panel 
scientists and other experts in rehabilitation or related fields who are 
qualified, on the basis of training, knowledge, or experience, to give 
expert advice on the merit of the applications under review.
    (b) Applications for awards of $60,000 or more, except those for the 
purposes of evaluation, dissemination of information, or conferences, 
must be reviewed by a peer review panel that consists of a majority of 
non-Federal members.
    (c) In selecting members to serve on a peer review panel, the 
Secretary takes into account all of the following factors:
    (1) The level of formal scientific or technical education completed 
by potential panel members.
    (2)(i) The extent to which potential panel members have engaged in 
scientific, technical, or administrative activities appropriate to the 
category of applications that the panel will consider;
    (ii) The roles of potential panel members in those activities; and
    (iii) The quality of those activities.
    (3) The recognition received by potential panel members as reflected 
by awards and other honors from scientific and professional agencies and 
organizations outside the Department.
    (4) Whether the panel includes knowledgeable individuals with 
disabilities, or parents, family members, guardians, advocates, or 
authorized representatives of individuals with disabilities.
    (5) Whether the panel includes individuals from diverse populations.

(Authority: Secs. 18 and 202(e); 29 U.S.C. 717 and 761a(e))



Sec. 350.53  How does the Secretary evaluate an application?

    (a)(1)(i) The Secretary selects one or more of the selection 
criteria in Sec. 350.54 to evaluate an application;
    (ii) The Secretary establishes selection criteria based on statutory 
provisions that apply to the Program which may include, but are not 
limited to--
    (A) Specific statutory selection criteria;
    (B) Allowable activities;
    (C) Application content requirements; or
    (D) Other pre-award and post-award conditions; or
    (iii) The Secretary uses a combination of selection criteria 
established under paragraph (a)(1)(ii) of this section and selection 
criteria in Sec. 350.54.
    (2) For Field-Initiated Projects, the Secretary does not consider 
Sec. 350.54(b) (Responsiveness to the Absolute or Competitive Priority) 
in evaluating an application.
    (b)(1) In considering selection criteria in Sec. 350.54, the 
Secretary selects one or more of the factors listed in the criteria 
except as provided for in paragraph (b)(2) of this section.
    (2) Under Sec. 350.54, the Secretary always considers the factor in 
paragraph (n)(2) of that section.
    (c) The maximum possible score for an application is 100 points.
    (d)(1) In the application package or a notice published in the 
Federal Register, the Secretary informs applicants of--
    (i)(A) The selection criteria chosen; and

[[Page 231]]

    (B) The maximum possible score for each of the selection criteria; 
and
    (ii)(A) The factors selected for considering the selection criteria; 
and
    (B) If points are assigned to each factor, the maximum possible 
score for each factor under each criterion.
    (2) If no points are assigned to each factor, the Secretary 
evaluates each factor equally.
    (e) For Field-Initiated Projects, in addition to the selection 
criteria, the Secretary uses the additional considerations in selecting 
applications for funding as described in Sec. 350.55.

(Authority: Sec. 202(e); 29 U.S.C. 761a(e))



Sec. 350.54  What selection criteria does the Secretary use in 
evaluating an application?

    In addition to criteria established under Sec. 350.53(a)(1)(ii), 
the Secretary may select one or more of the following criteria in 
evaluating an application:
    (a) Importance of the problem. (1) The Secretary considers the 
importance of the problem.
    (2) In determining the importance of the problem, the Secretary 
considers one or more of the following factors:
    (i) The extent to which the applicant clearly describes the need and 
target population.
    (ii) The extent to which the proposed activities further the 
purposes of the Act.
    (iii) The extent to which the proposed activities address a 
significant need of one or more disabled populations.
    (iv) The extent to which the proposed activities address a 
significant need of rehabilitation service providers.
    (v) The extent to which the proposed activities address a 
significant need of those who provide services to individuals with 
disabilities.
    (vi) The extent to which the applicant proposes to provide training 
in a rehabilitation discipline or area of study in which there is a 
shortage of qualified researchers, or to a trainee population in which 
there is a need for more qualified researchers.
    (vii) The extent to which the proposed project will have beneficial 
impact on the target population.
    (b) Responsiveness to an absolute or competitive priority. (1) The 
Secretary considers the responsiveness of the application to an absolute 
or competitive priority published in the Federal Register.
    (2) In determining the application's responsiveness to the absolute 
or competitive priority, the Secretary considers one or more of the 
following factors:
    (i) The extent to which the applicant addresses all requirements of 
the absolute or competitive priority.
    (ii) The extent to which the applicant's proposed activities are 
likely to achieve the purposes of the absolute or competitive priority.
    (c) Design of research activities. (1) The Secretary considers the 
extent to which the design of research activities is likely to be 
effective in accomplishing the objectives of the project.
    (2) In determining the extent to which the design is likely to be 
effective in accomplishing the objectives of the project, the Secretary 
considers one or more of the following factors:
    (i) The extent to which the research activities constitute a 
coherent, sustained approach to research in the field, including a 
substantial addition to the state-of-the-art.
    (ii) The extent to which the methodology of each proposed research 
activity is meritorious, including consideration of the extent to 
which--
    (A) The proposed design includes a comprehensive and informed review 
of the current literature, demonstrating knowledge of the state-of-the-
art;
    (B) Each research hypothesis is theoretically sound and based on 
current knowledge;
    (C) Each sample population is appropriate and of sufficient size;
    (D) The data collection and measurement techniques are appropriate 
and likely to be effective; and
    (E) The data analysis methods are appropriate.
    (iii) The extent to which anticipated research results are likely to 
satisfy the original hypotheses and could be used for planning 
additional research, including generation of new hypotheses where 
applicable.
    (d) Design of development activities. (1) The Secretary considers 
the extent to

[[Page 232]]

which the design of development activities is likely to be effective in 
accomplishing the objectives of the project.
    (2)(i) In determining the extent to which the design is likely to be 
effective in accomplishing the objectives of the project, the Secretary 
considers one or more of the following factors:
    (ii) The extent to which the plan for development, clinical testing, 
and evaluation of new devices and technology is likely to yield 
significant products or techniques, including consideration of the 
extent to which--
    (A) The proposed project will use the most effective and appropriate 
technology available in developing the new device or technique;
    (B) The proposed development is based on a sound conceptual model 
that demonstrates an awareness of the state-of-the-art in technology;
    (C) The new device or technique will be developed and tested in an 
appropriate environment;
    (D) The new device or technique is likely to be cost-effective and 
useful;
    (E) The new device or technique has the potential for commercial or 
private manufacture, marketing, and distribution of the product; and
    (F) The proposed development efforts include adequate quality 
controls and, as appropriate, repeated testing of products.
    (e) Design of demonstration activities. (1) The Secretary considers 
the extent to which the design of demonstration activities is likely to 
be effective in accomplishing the objectives of the project.
    (2) In determining the extent to which the design is likely to be 
effective in accomplishing the objectives of the project, the Secretary 
considers one or more of the following factors:
    (i) The extent to which the proposed demonstration activities build 
on previous research, testing, or practices.
    (ii) The extent to which the proposed demonstration activities 
include the use of proper methodological tools and theoretically sound 
procedures to determine the effectiveness of the strategy or approach.
    (iii) The extent to which the proposed demonstration activities 
include innovative and effective strategies or approaches.
    (iv) The extent to which the proposed demonstration activities are 
likely to contribute to current knowledge and practice and be a 
substantial addition to the state-of-the-art.
    (v) The extent to which the proposed demonstration activities can be 
applied and replicated in other settings.
    (f) Design of training activities. (1) The Secretary considers the 
extent to which the design of training activities is likely to be 
effective in accomplishing the objectives of the project.
    (2) In determining the extent to which the design is likely to be 
effective in accomplishing the objectives of the project, the Secretary 
considers one or more of the following factors:
    (i) The extent to which the proposed training materials are likely 
to be effective, including consideration of their quality, clarity, and 
variety.
    (ii) The extent to which the proposed training methods are of 
sufficient quality, intensity, and duration.
    (iii) The extent to which the proposed training content--
    (A) Covers all of the relevant aspects of the subject matter; and
    (B) If relevant, is based on new knowledge derived from research 
activities of the proposed project.
    (iv) The extent to which the proposed training materials, methods, 
and content are appropriate to the trainees, including consideration of 
the skill level of the trainees and the subject matter of the materials.
    (v) The extent to which the proposed training materials and methods 
are accessible to individuals with disabilities.
    (vi) The extent to which the applicant's proposed recruitment 
program is likely to be effective in recruiting highly qualified 
trainees, including those who are individuals with disabilities.
    (vii) The extent to which the applicant is able to carry out the 
training activities, either directly or through another entity.
    (viii) The extent to which the proposed didactic and classroom 
training programs emphasize scientific methodology and are likely to 
develop highly qualified researchers.

[[Page 233]]

    (ix) The extent to which the quality and extent of the academic 
mentorship, guidance, and supervision to be provided to each individual 
trainee are of a high level and are likely to develop highly qualified 
researchers.
    (x) The extent to which the type, extent, and quality of the 
proposed clinical and laboratory research experience, including the 
opportunity to participate in advanced-level research, are likely to 
develop highly qualified researchers.
    (xi) The extent to which the opportunities for collegial and 
collaborative activities, exposure to outstanding scientists in the 
field, and opportunities to participate in the preparation of scholarly 
or scientific publications and presentations are extensive and 
appropriate.
    (g) Design of dissemination activities. (1) The Secretary considers 
the extent to which the design of dissemination activities is likely to 
be effective in accomplishing the objectives of the project.
    (2) In determining the extent to which the design is likely to be 
effective in accomplishing the objectives of the project, the Secretary 
considers one or more of the following factors:
    (i) The extent to which the content of the information to be 
disseminated--
    (A) Covers all of the relevant aspects of the subject matter; and
    (B) If appropriate, is based on new knowledge derived from research 
activities of the project.
    (ii) The extent to which the materials to be disseminated are likely 
to be effective and usable, including consideration of their quality, 
clarity, variety, and format.
    (iii) The extent to which the methods for dissemination are of 
sufficient quality, intensity, and duration.
    (iv) The extent to which the materials and information to be 
disseminated and the methods for dissemination are appropriate to the 
target population, including consideration of the familiarity of the 
target population with the subject matter, format of the information, 
and subject matter.
    (v) The extent to which the information to be disseminated will be 
accessible to individuals with disabilities.
    (h) Design of utilization activities. (1) The Secretary considers 
the extent to which the design of utilization activities is likely to be 
effective in accomplishing the objectives of the project.
    (2) In determining the extent to which the design is likely to be 
effective in accomplishing the objectives of the project, the Secretary 
considers one or more of the following factors:
    (i) The extent to which the potential new users of the information 
or technology have a practical use for the information and are likely to 
adopt the practices or use the information or technology, including new 
devices.
    (ii) The extent to which the utilization strategies are likely to be 
effective.
    (iii) The extent to which the information or technology is likely to 
be of use in other settings.
    (i) Design of technical assistance activities. (1) The Secretary 
considers the extent to which the design of technical assistance 
activities is likely to be effective in accomplishing the objectives of 
the project.
    (2) In determining the extent to which the design is likely to be 
effective in accomplishing the objectives of the project, the Secretary 
considers one or more of the following factors:
    (i) The extent to which the methods for providing technical 
assistance are of sufficient quality, intensity, and duration.
    (ii) The extent to which the information to be provided through 
technical assistance covers all of the relevant aspects of the subject 
matter.
    (iii) The extent to which the technical assistance is appropriate to 
the target population, including consideration of the knowledge level of 
the target population, needs of the target population, and format for 
providing information.
    (iv) The extent to which the technical assistance is accessible to 
individuals with disabilities.
    (j) Plan of operation. (1) The Secretary considers the quality of 
the plan of operation.
    (2) In determining the quality of the plan of operation, the 
Secretary considers one or more of the following factors:

[[Page 234]]

    (i) The adequacy of the plan of operation to achieve the objectives 
of the proposed project on time and within budget, including clearly 
defined responsibilities, and timelines for accomplishing project tasks.
    (ii) The adequacy of the plan of operation to provide for using 
resources, equipment, and personnel to achieve each objective.
    (k) Collaboration. (1) The Secretary considers the quality of 
collaboration.
    (2) In determining the quality of collaboration, the Secretary 
considers one or more of the following factors:
    (i) The extent to which the applicant's proposed collaboration with 
one or more agencies, organizations, or institutions is likely to be 
effective in achieving the relevant proposed activities of the project.
    (ii) The extent to which agencies, organizations, or institutions 
demonstrate a commitment to collaborate with the applicant.
    (iii) The extent to which agencies, organizations, or institutions 
that commit to collaborate with the applicant have the capacity to carry 
out collaborative activities.
    (l) Adequacy and reasonableness of the budget. (1) The Secretary 
considers the adequacy and the reasonableness of the proposed budget.
    (2) In determining the adequacy and the reasonableness of the 
proposed budget, the Secretary considers one or more of the following 
factors:
    (i) The extent to which the costs are reasonable in relation to the 
proposed project activities.
    (ii) The extent to which the budget for the project, including any 
subcontracts, is adequately justified to support the proposed project 
activities.
    (iii) The extent to which the applicant is of sufficient size, 
scope, and quality to effectively carry out the activities in an 
efficient manner.
    (m) Plan of evaluation. (1) The Secretary considers the quality of 
the plan of evaluation.
    (2) In determining the quality of the plan of evaluation, the 
Secretary considers one or more of the following factors:
    (i) The extent to which the plan of evaluation provides for periodic 
assessment of progress toward--
    (A) Implementing the plan of operation; and
    (B) Achieving the project's intended outcomes and expected impacts.
    (ii) The extent to which the plan of evaluation will be used to 
improve the performance of the project through the feedback generated by 
its periodic assessments.
    (iii) The extent to which the plan of evaluation provides for 
periodic assessment of a project's progress that is based on identified 
performance measures that--
    (A) Are clearly related to the intended outcomes of the project and 
expected impacts on the target population; and
    (B) Are objective, and quantifiable or qualitative, as appropriate.
    (n) Project staff. (1) The Secretary considers the quality of the 
project staff.
    (2) In determining the quality of the project staff, the Secretary 
considers the extent to which the applicant encourages applications for 
employment from persons who are members of groups that have 
traditionally been underrepresented based on race, color, national 
origin, gender, age, or disability.
    (3) In addition, the Secretary considers one or more of the 
following:
    (i) The extent to which the key personnel and other key staff have 
appropriate training and experience in disciplines required to conduct 
all proposed activities.
    (ii) The extent to which the commitment of staff time is adequate to 
accomplish all the proposed activities of the project.
    (iii) The extent to which the key personnel are knowledgeable about 
the methodology and literature of pertinent subject areas.
    (iv) The extent to which the project staff includes outstanding 
scientists in the field.
    (v) The extent to which key personnel have up-to-date knowledge from 
research or effective practice in the subject area covered in the 
priority.
    (o) Adequacy and accessibility of resources. (1) The Secretary 
considers the adequacy and accessibility of the applicant's resources to 
implement the proposed project.

[[Page 235]]

    (2) In determining the adequacy and accessibility of resources, the 
Secretary considers one or more of the following factors:
    (i) The extent to which the applicant is committed to provide 
adequate facilities, equipment, other resources, including 
administrative support, and laboratories, if appropriate.
    (ii) The quality of an applicant's past performance in carrying out 
a grant.
    (iii) The extent to which the applicant has appropriate access to 
clinical populations and organizations representing individuals with 
disabilities to support advanced clinical rehabilitation research.
    (iv) The extent to which the facilities, equipment, and other 
resources are appropriately accessible to individuals with disabilities 
who may use the facilities, equipment, and other resources of the 
project.

(Approved by the Office of Management and Budget under control number 
1820-0027)

(Authority: Secs. 202 and 204; 29 U.S.C. 761a and 762)



Sec. 350.55  What are the additional considerations for selecting 
Field-Initiated Project applications for funding?

    (a) The Secretary reserves funds to support some or all of the 
Field-Initiated Project applications that have been awarded points 
totaling 80% or more of the maximum possible points under the procedures 
described in Sec. 350.53.
    (b) In making a final selection of applications to support as Field-
Initiated Projects, the Secretary considers the extent to which 
applications that have been awarded a rating of 80% or more of the 
maximum possible points and meet one or more of the following 
conditions:
    (1) The proposed project represents a unique opportunity to advance 
rehabilitation knowledge to improve the lives of individuals with 
disabilities.
    (2) The proposed project complements research already planned or 
funded by the NIDRR through annual priorities published in the Federal 
Register or addresses the research in a new and promising way.

(Authority: Secs. 202 (g) and (i)(1); 29 U.S.C. 761a(g) and 761a(i)(1))



          Subpart G_What Conditions Must Be Met After an Award?



Sec. 350.60  How must a grantee conduct activities?

    A grantee must--
    (a) Conduct all activities in a manner that is accessible to and 
usable by individuals with disabilities; and
    (b) If a grantee carries out more than one activity, carry out 
integrated activities.

(Authority: Secs. 202 and 204(b)(2); 29 U.S.C. 761a and 762(b))



Sec. 350.61  What evaluation requirements must a grantee meet?

    (a) A grantee must establish performance measures for use in its 
evaluation that--
    (1) Are clearly related to the--
    (i) Intended outcomes of the project; and
    (ii) Expected impacts on the target population; and
    (2) To the extent possible are quantifiable, or are objective and 
qualitative.
    (b) A grantee must make periodic assessments of progress that will 
provide the grantee with performance feedback related to--
    (1) Progress in implementing the plan of operation; and
    (2) Progress in achieving the intended outcomes and expected impacts 
as assessed by the established performance measures.

(Authority: Secs. 202 and 204; 29 U.S.C. 761a and 762)



Sec. 350.62  What are the matching requirements?

    (a)(1) The Secretary may make grants to pay for part of the costs of 
research and demonstration projects that bear directly on the 
development of procedures, methods, and devices to assist the provision 
of vocational and other rehabilitation services, and research training 
and career development projects.
    (2) Each grantee must participate in the costs of those projects.
    (3) The specific amount of cost sharing to be borne by each 
grantee--
    (i) Is negotiated at the time of the award; and

[[Page 236]]

    (ii) Is not considered in the selection process.
    (b)(1) The Secretary may make grants to pay for part or all of the 
costs of--
    (i) Establishment and support of Rehabilitation Research and 
Training Centers and Rehabilitation Engineering Research Centers; and
    (ii) Specialized research or demonstration activities described in 
section 204(b)(2)-(16) of the Act.
    (2) The Secretary determines at the time of the award whether the 
grantee must pay a portion of the project or center costs.

(Authority: Sec. 204; 29 U.S.C. 762)



Sec. 350.63  What are the requirements of a grantee relative to the 
Client Assistance Program?

    All Projects and Centers that provide services to individuals with 
disabilities with funds awarded under this Program must--
    (a) Advise those individuals who are applicants for or recipients of 
services under the Act, or their parents, family members, guardians, 
advocates, or authorized representatives, of the availability and 
purposes of the Client Assistance Program (CAP) funded under the Act; 
and
    (b) Provide information on the means of seeking assistance under the 
CAP.

(Authority: Sec. 20; 29 U.S.C. 718a)



Sec. 350.64  What is the required duration of the training in an Advanced 
Rehabilitation Research Training Project?

    A grantee for an Advanced Rehabilitation Research Training Project 
shall provide training to individuals that is at least one academic 
year, unless a longer training period is necessary to ensure that each 
trainee is qualified to conduct independent research upon completion of 
the course of training.

(Authority: Secs. 202-204; 29 U.S.C. 760-762)



Sec. 350.65  What level of participation is required of trainees in an 
Advanced Rehabilitation Research Training Project?

    Individuals who are receiving training under an Advanced 
Rehabilitation Research Training Project shall devote at least eighty 
percent of their time to the activities of the training program during 
the training period.

(Authority: Secs. 202-204; 29 U.S.C. 760-762)



Sec. 350.66  What must a grantee include in a patent application?

    Any patent application filed by a grantee for an invention made 
under a grant must include the following statement in the first 
paragraph:

    The invention described in this application was made under a grant 
from the Department of Education.

(Authority: 20 U.S.C. 1221e-3)



PART 356_DISABILITY AND REHABILITATION RESEARCH: RESEARCH FELLOWSHIPS
--Table of Contents




                            Subpart A_General

Sec.
356.1 What is the Research Fellowships Program?
356.2 Who is eligible for assistance under this program?
356.3 What regulations apply to this program?
356.4 What definitions apply to this program?

  Subpart B_What Kinds of Activities Does the Department Support Under 
                              This Program?

356.10 What types of activities are authorized?
356.11 What types of problems may be researched under the fellowship 
          program?

     Subpart C_How Does One Apply for Assistance Under This Program?

356.20 What are the application procedures under this part?
356.21 What is the fellowship review process?

            Subpart D_How Does the Secretary Select a Fellow?

356.30 What selection criteria are used for this program?
356.31 How does the Secretary evaluate an application under this part?
356.32 What are the special considerations in selecting applications for 
          funding under this part?

[[Page 237]]

          Subpart E_What Conditions Have To Be Met by a Fellow?

356.40 What is the length of a Fellowship award?
356.41 What are the employment limitations during a fellowship period?
356.42 What acknowledgement of support is required?

   Subpart F_What are the Administrative Responsibilities of a Fellow?

356.50 What kinds of payments are allowed under this program?
356.51 What reports are required?
356.52 Are there other requirements?

    Authority: 29 U.S.C. 760-762, unless otherwise noted.

    Source: 46 FR 45312, Sept. 10, 1981, unless otherwise noted.



                            Subpart A_General



Sec. 356.1  What is the Research Fellowships Program?

    The purpose of this program is to build research capacity by 
providing support to highly qualified individuals, including those who 
are individuals with disabilities, to perform research on the 
rehabilitation of individuals with disabilities.

(Authority: Sec. 202(d); 29 U.S.C. 761a(d))

[49 FR 24979, June 18, 1984, as amended at 58 FR 49419, Sept. 22, 1993]



Sec. 356.2  Who is eligible for assistance under this program?

    (a) Only individuals are eligible to be recipients of Fellowships.
    (b) Any individual is eligible for assistance under this program who 
has training and experience that indicate a potential for engaging in 
scientific research related to the solution of rehabilitation problems 
of individuals with disabilities.
    (c) This program provides two categories of Fellowships: Merit 
Fellowships and Distinguished Fellowships.
    (1) To be eligible for a Distinguished Fellowship, an individual 
must have seven or more years of research experience in subject areas, 
methods, or techniques relevant to rehabilitation research and must have 
a doctorate, other terminal degree, or comparable academic 
qualifications.
    (2) The Secretary awards Merit Fellowships to individuals in earlier 
stages of their careers in research. To be eligible for a Merit 
Fellowship, an individual must have either advanced professional 
training or experience in independent study in an area which is directly 
pertinent to disability and rehabilitation.
    (d) An applicant for a fellowship under this program must be 
eligible under 34 CFR 75.60.

(Authority: Sec. 202(d); 29 U.S.C. 761a(d))

[49 FR 24979, June 18, 1984, as amended at 57 FR 30343, July 8, 1992; 58 
FR 49419, Sept. 22, 1993]



Sec. 356.3  What regulations apply to this program?

    The following regulations apply to this program:
    (a) The peer review requirements contained in 34 CFR 350.31-350.32.
    (b) The regulations in this part--34 CFR part 356;
    (c)(1) Subject to the additional requirement in paragraph (c)(2) of 
this section, 34 CFR part 97, Protection of Human Subjects.
    (2) When an IRB reviews research that purposefully requires 
inclusion of children with disabilities or individuals with mental 
disabilities as research subjects, the IRB must include at least one 
person primarily concerned with the welfare of these research subjects.
    (d) The regulations in 34 CFR 75.60-75.61 (regarding the 
ineligibility of certain individuals to receive assistance).

(Authority: 29 U.S.C. 761a(d), 42 U.S.C. 300v-1(b))

[46 FR 45312, Sept. 10, 1981, as amended at 56 FR 28031, June 18, 1991; 
57 FR 30343, July 8, 1992; 58 FR 49419, Sept. 22, 1993; 60 FR 17431, 
Apr. 5, 1995]



Sec. 356.4  What definitions apply to this program?

    The definitions listed in 34 CFR 350.4 apply to this program.

(Authority: Sec. 202(i)(1); (29 U.S.C. 761a(i)(1)))

[[Page 238]]



  Subpart B_What Kinds of Activities Does the Department Support Under 
                              This Program?



Sec. 356.10  What types of activities are authorized?

    (a) Fellows may conduct original research in any area authorized by 
section 204 of the Act.
    (b) Each year the Secretary may determine that research is needed in 
certain areas authorized under section 204 of the Act and may set aside 
funds to provide fellowship assistance for research in these specific 
areas. The Secretary publishes the selected priorities, if any, in a 
notice in the Federal Register.

(Authority: Sec. 202(d); 29 U.S.C. 761a(d))

[49 FR 24979, June 18, 1984]



Sec. 356.11  What types of problems may be researched under the fellowship 
program?

    Problems encountered by individuals with disabilities in their daily 
lives that are due to the presence of a disabling condition, problems 
associated with the provision of rehabilitation services to individuals 
with disabilities, and problems connected with the conduct of disability 
research may be addressed under this program.

(Authority: Secs. 202(d), 202(g)(1), 204; 29 U.S.C. 761a(d), 761a(g)(1), 
762)

[58 FR 49419, Sept. 22, 1993]



     Subpart C_How Does One Apply for Assistance Under This Program?



Sec. 356.20  What are the application procedures under this part?

    From time to time the Secretary will publish in the Federal Register 
an Application Notice that announces the availability of fellowship 
assistance under this part.

(Authority: Sec. 202(d); (29 U.S.C. 761a(d)))



Sec. 356.21  What is the fellowship review process?

    The Secretary reviews applications for Fellowships in accordance 
with the peer review requirements governing grants in 34 CFR 350.31 and 
350.32 and the selection criteria contained in Sec. 356.30.

(Approved by the Office of Management and Budget under control number 
1800-0027)

(Authority: Sec. 202(d); 29 U.S.C. 761a(d))

[49 FR 24979, June 18, 1984]



            Subpart D_How Does the Secretary Select a Fellow?



Sec. 356.30  What selection criteria are used for this program?

    The Secretary evaluates an application for a Fellowship on the basis 
of--
    (a) Quality and level of formal education, previous work experience, 
and recommendations of present or former supervisors or colleagues that 
include an indication of the applicant's ability to work creatively in 
scientific research; and
    (b) The quality of a research proposal of no more than 12 pages 
containing the following information:
    (1) The importance of the problem to be investigated to the purpose 
of the Act and the mission of the Institute.
    (2) The research hypotheses or related objectives and the 
methodology and design to be followed.
    (3) Assurance of the availability of any necessary data resources, 
equipment, or institutional support, including technical consultation 
and support where appropriate, required to carry out the proposed 
activity.

(Approved by the Office of Management and Budget under control number 
1800-0027)

(Authority: Sec. 202(d); 29 U.S.C. 761a(d))

[49 FR 24979, June 18, 1984, as amended at 52 FR 30065, Aug. 12, 1987]



Sec. 356.31  How does the Secretary evaluate an application under this 
part?

    The Secretary awards the following points for each application based 
on how well the applicant addresses the two criteria in Sec. 356.30: 
Outstanding (5); Superior (4); Satisfactory (3); Marginal (2); Poor (1).

(Authority: Sec. 202(d); 29 U.S.C. 761a(d))

[49 FR 24979, June 18, 1984]

[[Page 239]]



Sec. 356.32  What are the special considerations in selecting applications 
for funding under this part?

    (a) The Secretary reserves funds to support some or all of the 
applications which have been awarded a rating of superior or better (4-5 
points) under Sec. 356.31.
    (b) In making a final selection of applicants to support under this 
program, the Secretary considers the extent to which applicants rated 
outstanding or superior present a unique opportunity to effect a major 
advance in knowledge, address critical problems in innovative ways, 
present proposals which are consistent with the Institute's Long-Range 
Plan, build research capacity within the field, or complement and 
significantly increases the potential value of already planned research 
and related activities.

(Approved by the Office of Management and Budget under control number 
1800-0027)

(Authority: Sec. 202(d); 29 U.S.C. 761a(d))

[49 FR 24979, June 18, 1984, as amended at 52 FR 30065, Aug. 12, 1987]



          Subpart E_What Conditions Have To Be Met by a Fellow?



Sec. 356.40  What is the length of a Fellowship award?

    The Secretary awards Fellowships for a period of 12 months. Under 
exceptional circumstances, the Secretary may extend the period of a 
Fellowship; such an extension may not exceed 12 months.

(Authority: Sec. 202(d); 29 U.S.C. 761a(d))

[49 FR 24979, June 18, 1984]



Sec. 356.41  What are the employment limitations during a fellowship 
period?

    The Secretary may require a research fellow to work full time on 
authorized fellowship activities.

(Authority: Sec. 202(d); (29 U.S.C. 761a(d)))



Sec. 356.42  What acknowledgement of support is required?

    Publication, distribution, and disposition of all manuscripts and 
other materials resulting from a fellowship awarded under this part must 
acknowledge that assistance was received from the Department and the 
Institute. Three copies of these publications or other materials must be 
furnished to the Secretary.

(Authority: Sec. 202(d); (29 U.S.C. 761a(d)))



   Subpart F_What are the Administrative Responsibilities of a Fellow?



Sec. 356.50  What kinds of payments are allowed under this program?

    A Fellowship award in either the Distinguished or Merit category 
includes a fixed stipend and a flat rate allowance for research and 
research-related expenses including travel expenses.

(Authority: Sec. 202(d); 29 U.S.C. 761a(d))

[49 FR 24979, June 18, 1984]



Sec. 356.51  What reports are required?

    Fellows shall submit final reports. Each report must contain at a 
minimum an analysis of the significance of the project and an assessment 
of the degree to which the objectives of the project have been achieved.

(Authority: Sec. 202(d); 29 U.S.C. 761a(d))

[49 FR 24979, June 18, 1984]



Sec. 356.52  Are there other requirements?

    The Secretary may require fellows to attend one or more meetings in 
connection with Fellowship activities.

(Authority: Sec. 202(d); 29 U.S.C. 761a(d))

[49 FR 24979, June 18, 1984]



PART 359_DISABILITY AND REHABILITATION RESEARCH: SPECIAL PROJECTS AND 
DEMONSTRATIONS FOR SPINAL CORD INJURIES--Table of Contents




                            Subpart A_General

Sec.
359.1 What is the Special Projects and Demonstrations for Spinal Cord 
          Injuries Program?
359.2 Who is eligible for assistance under this program?
359.3 What regulations apply to this program?
359.4 What definitions apply to this program?
359.5-359.9 [Reserved]

[[Page 240]]

Subpart B_What Kinds of Activities Does the Secretary Assist Under This 
                                Program?

359.10 What types of projects are authorized under this program?
359.11 What activities must each recipient carry out under this program?
359.12-359.19 [Reserved]

Subpart C [Reserved]

             Subpart D_How Does the Secretary Make a Grant?

359.30 How is peer review conducted under this program?
359.31 What selection criteria does the Secretary use in reviewing 
          applications under this program?
359.32 What additional factors does the Secretary consider in making a 
          grant under this program?
359.33-359.39 [Reserved]

    Authority: 29 U.S.C. 762(b)(4), unless otherwise noted.

    Source: 50 FR 16676, Apr. 26, 1985, unless otherwise noted.



                            Subpart A_General



Sec. 359.1  What is the Special Projects and Demonstrations for Spinal 
Cord Injuries Program?

    This program provides assistance to establish innovative projects 
for the delivery, demonstration, and evaluation of comprehensive 
medical, vocational, and other rehabilitation services to meet the wide 
range of needs of individuals with spinal cord injuries.

(Authority: Sec. 204(b)(4); 29 U.S.C. 762(b)(4))



Sec. 359.2  Who is eligible for assistance under this program?

    The agencies and organizations eligible to apply under this program 
are described in 34 CFR 350.2.

(Authority: Sec. 204(b)(4)(A); 29 U.S.C. 762(b)(4)(A))

[58 FR 49420, Sept. 22, 1993]



Sec. 359.3  What regulations apply to this program?

    The regulations referenced in 34 CFR 350.3 apply to this program.

(Authority: Secs. 202 and 204; 29 U.S.C. 761a and 762)



Sec. 359.4  What definitions apply to this program?

    The definitions listed in 34 CFR 350.4 apply to this program.

(Authority: Sec. 202(i)(1); 29 U.S.C. 761a(i)(1))



Sec. Sec. 359.5-359.9  [Reserved]



Subpart B_What Kinds of Activities Does the Secretary Assist Under This 
                                Program?



Sec. 359.10  What types of projects are authorized under this program?

    This program provides assistance for demonstration projects that--
    (a) Provide comprehensive rehabilitation services to individuals 
with spinal cord injuries; and
    (b) Conduct spinal cord research, including clinical research and 
the analysis of standardized data in collaboration with other related 
projects.

(Authority: Sec. 204(b)(4); 29 U.S.C. 762(b)(4))



Sec. 359.11  What activities must each recipient carry out under this 
program?

    Each recipient, whether administering a project separately under 
this part or in coordination with other activities supported under title 
II of the Act, shall--
    (a) Establish a multidisciplinary system of providing rehabilitation 
services specifically designed to meet the special needs of individuals 
with spinal cord injuries, including emergency medical services, acute 
care, vocational and other rehabilitation services, community and job 
placement, and long-term community follow up and health maintenance. The 
system must be established on an appropriate geographical basis that 
reflects patterns of patient flow, and must be administered in close 
coordination with similar programs of the Veterans Administration, the 
National Institutes of Health, and other public and private agencies and 
institutions where appropriate;
    (b) Demonstrate and evaluate both the service and cost benefits of a 
regional service system to those individuals with spinal cord injuries 
who might be served within that system;

[[Page 241]]

    (c) Establish within the system a rehabilitation research 
environment for the achievement of new knowledge leading to the 
reduction and treatment of complications arising from spinal cord injury 
and the development of new techniques of medical management and 
rehabilitation;
    (d) Demonstrate and evaluate the development and application of 
improved methods and equipment essential to the care, management, and 
rehabilitation of individuals with spinal cord injury;
    (e) Demonstrate methods of community outreach and education for 
individuals with spinal cord injury in areas such as housing, 
transportation, recreation, employment, and other community activities; 
and
    (f) Address the needs of individuals with spinal cord injuries from 
minority backgrounds;
    (g) Participate as directed by the Secretary in national studies of 
the benefits of a spinal cord injury service system by contributing to a 
national database and by other means as required by the Secretary.

(Authority: Secs. 21(b)(6) and 204(b)(4); 29 U.S.C. 718b and 762(b)(4))

[50 FR 16676, Apr. 26, 1985, as amended at 58 FR 49420, Sept. 22, 1993]



Sec. Sec. 359.12-359.19  [Reserved]

Subpart C [Reserved]



             Subpart D_How Does the Secretary Make a Grant?



Sec. 359.30  How is peer review conducted under this program?

    Peer review is conducted under this program in accordance with 34 
CFR 350.30-350.32, using the selection criteria in Sec. 359.31.

(Authority: Sec. 202(e); 29 U.S.C. 761a(e))



Sec. 359.31  What selection criteria does the Secretary use in reviewing 
applications under this program?

    The Secretary uses the criteria in this section to evaluate 
applications under this program. The maximum score for all the criteria 
is 100 points.
    (a) Project design (20 points). The Secretary reviews each 
application to determine to what degree--
    (1) There is a clear description of how the objectives of the 
project relate to the purpose of the program;
    (2) The research is likely to produce new and useful information;
    (3) The need and target population are adequately defined;
    (4) The outcomes are likely to benefit the defined target 
population;
    (5) The research hypotheses are sound; and
    (6) The research methodology is sound in the sample design and 
selection, the data collection plan, the measurement instruments, and 
the data analysis plan.
    (b) Service comprehensiveness (20 points). The Secretary reviews 
each application to determine to what degree--
    (1) The services to be provided within the project are comprehensive 
in scope, and include emergency medical services, intensive and acute 
medical care, rehabilitation management, psychosocial and community 
reintegration, and follow up;
    (2) A broad range of vocational and other rehabilitation services 
will be available to severely handicapped individuals within the 
project; and
    (3) Services will be coordinated with those services provided by 
other appropriate community resources.
    (c) Plan of operation (15 points). The Secretary reviews each 
application to determine to what degree--
    (1) There is an effective plan of operation that ensures proper and 
efficient administration of the project;
    (2) The applicant's planned use of its resources and personnel is 
likely to achieve each objective;
    (3) Collaboration between institutions, if proposed, is likely to be 
effective; and
    (4) There is a clear description of how the applicant will include 
eligible project participants who have been traditionally 
underrepresented, such as--
    (i) Members of racial or ethnic minority groups;
    (ii) Women;
    (iii) Individuals with disabilities; and
    (iv) The elderly.

[[Page 242]]

    (d) Quality of key personnel (10 points). The Secretary reviews each 
application to determine to what degree--
    (1) The principal investigator and other key staff have adequate 
training or experience, or both, in spinal cord injury care and 
rehabilitation and demonstrate appropriate potential to conduct the 
proposed research, demonstration, training, development, or 
dissemination activity;
    (2) The principal investigator and other key staff are familiar with 
pertinent literature or methods, or both;
    (3) All the disciplines necessary to establish the multidisciplinary 
system described in Sec. 359.11(a) are effectively represented;
    (4) Commitments of staff time are adequate for the project; and
    (5) The applicant is likely, as part of its non-discriminatory 
employment practices, to encourage applications for employment from 
persons who are members of groups that traditionally have been 
underrepresented, such as--
    (i) Members of racial or ethnic minority groups;
    (ii) Women;
    (iii) Individuals with disabilities; and
    (iv) The elderly.
    (e) Adequacy of resources (10 points). The Secretary reviews each 
application to determine to what degree--
    (1) The facilities planned for use are adequate;
    (2) The equipment and supplies planned for use are adequate; and
    (3) The commitment of the applicant to provide administrative and 
other necessary support is evident.
    (f) Budget/cost effectiveness (10 points). The Secretary reviews 
each application to determine to what degree--
    (1) The budget for the project is adequate to support the 
activities;
    (2) The costs are reasonable in relation to the objectives of the 
project; and
    (3) The budget for subcontracts (if required) is detailed and 
appropriate.
    (g) Dissemination/utilization (5 points). The Secretary reviews each 
application to determine to what degree--
    (1) There is a clearly defined plan for dissemination and 
utilization of project findings;
    (2) The research results are likely to become available to others 
working in the field;
    (3) The means to disseminate and promote utilization by others are 
defined; and
    (4) The utilization approach is likely to address the defined need.
    (h) Evaluation plan (10 points). The Secretary reviews each 
application to determine to what degree--
    (1) There is a mechanism to evaluate plans, progress and results;
    (2) The evaluation methods and objectives are likely to produce data 
that are quantifiable; and
    (3) The evaluation results, where relevant, are likely to be 
assessed in a service setting.

(Authority: Secs. 202(e) and 204(b)(4); 29 U.S.C. 761a(e) and 762(b)(4))

[50 FR 16676, Apr. 26, 1985, as amended at 58 FR 49420, Sept. 22, 1993]



Sec. 359.32  What additional factors does the Secretary consider in 
making a grant under this program?

    In determining which applicants to fund under this program, the 
Secretary also considers the proposed location of any project in order 
to achieve, to the extent possible, a geographic distribution of 
projects.

(Authority: Sec. 204(b)(4)(C); 29 U.S.C. 762(b)(4)(C))

[52 FR 30066, Aug. 12, 1987]



Sec. Sec. 359.33-359.39  [Reserved]



PART 361_STATE VOCATIONAL REHABILITATION SERVICES PROGRAM--Table of Contents




                            Subpart A_General

Sec.
361.1 Purpose.
361.2 Eligibility for a grant.
361.3 Authorized activities.
361.4 Applicable regulations.
361.5 Applicable definitions.

       Subpart B_State Plan and Other Requirements for Vocational 
                         Rehabilitation Services

361.10 Submission, approval, and disapproval of the State plan.
361.11 Withholding of funds.

[[Page 243]]

                             Administration

361.12 Methods of administration.
361.13 State agency for administration.
361.14 Substitute State agency.
361.15 Local administration.
361.16 Establishment of an independent commission or a State 
          Rehabilitation Council.
361.17 Requirements for a State Rehabilitation Council.
361.18 Comprehensive system of personnel development.
361.19 Affirmative action for individuals with disabilities.
361.20 Public participation requirements.
361.21 Consultations regarding the administration of the State plan.
361.22 Coordination with education officials.
361.23 Requirements related to the statewide workforce investment 
          system.
361.24 Cooperation and coordination with other entities.
361.25 Statewideness.
361.26 Waiver of statewideness.
361.27 Shared funding and administration of joint programs.
361.28 Third-party cooperative arrangements involving funds from other 
          public agencies.
361.29 Statewide assessment; annual estimates; annual State goals and 
          priorities; strategies; and progress reports.
361.30 Services to American Indians.
361.31 Cooperative agreements with private nonprofit organizations.
361.32 Use of profitmaking organizations for on-the-job training in 
          connection with selected projects.
361.33 [Reserved.]
361.34 Supported employment State plan supplement.
361.35 Innovation and expansion activities.
361.36 Ability to serve all eligible individuals; order of selection for 
          services.
361.37 Information and referral services.
361.38 Protection, use, and release of personal information.
361.39 State-imposed requirements.
361.40 Reports.

                     Provision and Scope of Services

361.41 Processing referrals and applications.
361.42 Assessment for determining eligibility and priority for services.
361.43 Procedures for ineligibility determination.
361.44 Closure without eligibility determination.
361.45 Development of the individualized plan for employment.
361.46 Content of the individualized plan for employment.
361.47 Record of services.
361.48 Scope of vocational rehabilitation services for individuals with 
          disabilities.
361.49 Scope of vocational rehabilitation services for groups of 
          individuals with disabilities.
361.50 Written policies governing the provision of services for 
          individuals with disabilities.
361.51 Standards for facilities and providers of services.
361.52 Informed choice.
361.53 Comparable services and benefits.
361.54 Participation of individuals in cost of services based on 
          financial need.
361.55 Annual review of individuals in extended employment and other 
          employment under special certificate provisions of the Fair 
          Labor Standards Act.
361.56 Requirements for closing the record of services of an individual 
          who has achieved an employment outcome.
361.57 Review of determinations made by designated State unit personnel.

     Subpart C_Financing of State Vocational Rehabilitation Programs

361.60 Matching requirements.
361.61 Limitation on use of funds for construction expenditures.
361.62 Maintenance of effort requirements.
361.63 Program income.
361.64 Obligation of Federal funds and program income.
361.65 Allotment and payment of Federal funds for vocational 
          rehabilitation services.

Subpart D [Reserved]

        Subpart E_Evaluation Standards and Performance Indicators

361.80 Purpose.
361.81 Applicable definitions.
361.82 Evaluation standards.
361.84 Performance indicators.
361.86 Performance levels.
361.88 Reporting requirements.
361.89 Enforcement procedures.

Appendix A to Part 361--Questions and Answers

    Authority: 29 U.S.C. 709(c), unless otherwise noted.

    Source: 66 FR 4382, Jan. 17, 2001, unless otherwise noted.



                            Subpart A_General



Sec. 361.1  Purpose.

    Under the State Vocational Rehabilitation Services Program 
(Program), the Secretary provides grants to assist

[[Page 244]]

States in operating statewide comprehensive, coordinated, effective, 
efficient, and accountable programs, each of which is--
    (a) An integral part of a statewide workforce investment system; and
    (b) Designed to assess, plan, develop, and provide vocational 
rehabilitation services for individuals with disabilities, consistent 
with their strengths, resources, priorities, concerns, abilities, 
capabilities, interests, and informed choice, so that they may prepare 
for and engage in gainful employment.

(Authority: Section 100(a)(2) of the Act; 29 U.S.C. 720(a)(2))



Sec. 361.2  Eligibility for a grant.

    Any State that submits to the Secretary a State plan that meets the 
requirements of section 101(a) of the Act and this part is eligible for 
a grant under this Program.

(Authority: Section 101(a) of the Act; 29 U.S.C. 721(a))



Sec. 361.3  Authorized activities.

    The Secretary makes payments to a State to assist in--
    (a) The costs of providing vocational rehabilitation services under 
the State plan; and
    (b) Administrative costs under the State plan.

(Authority: Section 111(a)(1) of the Act; 29 U.S.C. 731(a)(1))



Sec. 361.4  Applicable regulations.

    The following regulations apply to this Program:
    (a) The Education Department General Administrative Regulations 
(EDGAR) as follows:
    (1) 34 CFR part 74 (Administration of Grants and Agreements with 
Institutions of Higher Education, Hospitals, and other Non-profit 
Organizations), with respect to subgrants to entities that are not State 
or local governments or Indian tribal organizations.
    (2) 34 CFR part 76 (State-Administered Programs).
    (3) 34 CFR part 77 (Definitions that Apply to Department 
Regulations).
    (4) 34 CFR part 79 (Intergovernmental Review of Department of 
Education Programs and Activities).
    (5) 34 CFR part 80 (Uniform Administrative Requirements for Grants 
and Cooperative Agreements to State and Local Governments), except for 
Sec. 80.24(a)(2).
    (6) 34 CFR part 81 (General Education Provisions Act--Enforcement).
    (7) 34 CFR part 82 (New Restrictions on Lobbying).
    (8) 34 CFR part 85 (Governmentwide Debarment and Suspension 
(Nonprocurement) and Governmentwide Requirements for Drug-Free Workplace 
(Grants)).
    (9) 34 CFR part 86 (Drug and Alcohol Abuse Prevention).
    (b) The regulations in this part 361.
    (c) 20 CFR part 662 (Description of One-Stop Service Delivery System 
under Title I of the Workforce Investment Act of 1998).
    (d) 29 CFR part 37, to the extent programs and activities are being 
conducted as part of the One-Stop service delivery system under section 
121(b) of the Workforce Investment Act of 1998.

(Authority: Section 12(c) of the Act; 29 U.S.C. 709(c))



Sec. 361.5  Applicable definitions.

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

Department
EDGAR
Fiscal year
Nonprofit
Private
Public
Secretary

    (b) Other definitions. The following definitions also apply to this 
part:
    (1) Act means the Rehabilitation Act of 1973, as amended (29 U.S.C. 
701 et seq.).
    (2) Administrative costs under the State plan means expenditures 
incurred in the performance of administrative functions under the 
vocational rehabilitation program carried out under this part, including 
expenses related to program planning, development, monitoring, and 
evaluation, including, but not limited to, expenses for--
    (i) Quality assurance;
    (ii) Budgeting, accounting, financial management, information 
systems, and related data processing;

[[Page 245]]

    (iii) Providing information about the program to the public;
    (iv) Technical assistance and support services to other State 
agencies, private nonprofit organizations, and businesses and 
industries, except for technical assistance and support services 
described in Sec. 361.49(a)(4);
    (v) The State Rehabilitation Council and other advisory committees;
    (vi) Professional organization membership dues for designated State 
unit employees;
    (vii) The removal of architectural barriers in State vocational 
rehabilitation agency offices and State-operated rehabilitation 
facilities;
    (viii) Operating and maintaining designated State unit facilities, 
equipment, and grounds;
    (ix) Supplies;
    (x) Administration of the comprehensive system of personnel 
development described in Sec. 361.18, including personnel 
administration, administration of affirmative action plans, and training 
and staff development;
    (xi) Administrative salaries, including clerical and other support 
staff salaries, in support of these administrative functions;
    (xii) Travel costs related to carrying out the program, other than 
travel costs related to the provision of services;
    (xiii) Costs incurred in conducting reviews of determinations made 
by personnel of the designated State unit, including costs associated 
with mediation and impartial due process hearings under Sec. 361.57; 
and
    (xiv) Legal expenses required in the administration of the program.


(Authority: Section 7(1) of the Act; 29 U.S.C. 705(1))

    (3) American Indian means an individual who is a member of an Indian 
tribe.


(Authority: Section 7(19)(A) of the Act; 29 U.S.C. 705(19)(A))

    (4) Applicant means an individual who submits an application for 
vocational rehabilitation services in accordance with Sec. 
361.41(b)(2).


(Authority: Section 12(c) of the Act; 29 U.S.C. 709(c))

    (5) Appropriate modes of communication means specialized aids and 
supports that enable an individual with a disability to comprehend and 
respond to information that is being communicated. Appropriate modes of 
communication include, but are not limited to, the use of interpreters, 
open and closed captioned videos, specialized telecommunications 
services and audio recordings, Brailled and large print materials, 
materials in electronic formats, augmentative communication devices, 
graphic presentations, and simple language materials.


(Authority: Section 12(c) of the Act; 29 U.S.C. 709(c))

    (6) Assessment for determining eligibility and vocational 
rehabilitation needs means, as appropriate in each case--
    (i)(A) A review of existing data--
    (1) To determine if an individual is eligible for vocational 
rehabilitation services; and
    (2) To assign priority for an order of selection described in Sec. 
361.36 in the States that use an order of selection; and
    (B) To the extent necessary, the provision of appropriate assessment 
activities to obtain necessary additional data to make the eligibility 
determination and assignment;
    (ii) To the extent additional data are necessary to make a 
determination of the employment outcomes and the nature and scope of 
vocational rehabilitation services to be included in the individualized 
plan for employment of an eligible individual, a comprehensive 
assessment to determine the unique strengths, resources, priorities, 
concerns, abilities, capabilities, interests, and informed choice, 
including the need for supported employment, of the eligible individual. 
This comprehensive assessment--
    (A) Is limited to information that is necessary to identify the 
rehabilitation needs of the individual and to develop the individualized 
plan of employment of the eligible individual;
    (B) Uses as a primary source of information, to the maximum extent 
possible and appropriate and in accordance with confidentiality 
requirements--

[[Page 246]]

    (1) Existing information obtained for the purposes of determining 
the eligibility of the individual and assigning priority for an order of 
selection described in Sec. 361.36 for the individual; and
    (2) Information that can be provided by the individual and, if 
appropriate, by the family of the individual;
    (C) May include, to the degree needed to make such a determination, 
an assessment of the personality, interests, interpersonal skills, 
intelligence and related functional capacities, educational 
achievements, work experience, vocational aptitudes, personal and social 
adjustments, and employment opportunities of the individual and the 
medical, psychiatric, psychological, and other pertinent vocational, 
educational, cultural, social, recreational, and environmental factors 
that affect the employment and rehabilitation needs of the individual; 
and
    (D) May include, to the degree needed, an appraisal of the patterns 
of work behavior of the individual and services needed for the 
individual to acquire occupational skills and to develop work attitudes, 
work habits, work tolerance, and social and behavior patterns necessary 
for successful job performance, including the use of work in real job 
situations to assess and develop the capacities of the individual to 
perform adequately in a work environment;
    (iii) Referral, for the provision of rehabilitation technology 
services to the individual, to assess and develop the capacities of the 
individual to perform in a work environment; and
    (iv) An exploration of the individual's abilities, capabilities, and 
capacity to perform in work situations, which must be assessed 
periodically during trial work experiences, including experiences in 
which the individual is provided appropriate supports and training.


(Authority: Section 7(2) of the Act; 29 U.S.C. 705(2))

    (7) Assistive technology device means any item, piece of equipment, 
or product system, whether acquired commercially off the shelf, 
modified, or customized, that is used to increase, maintain, or improve 
the functional capabilities of an individual with a disability.


(Authority: Section 7(3) of the Act; 29 U.S.C. 705(3))

    (8) Assistive technology service means any service that directly 
assists an individual with a disability in the selection, acquisition, 
or use of an assistive technology device, including--
    (i) The evaluation of the needs of an individual with a disability, 
including a functional evaluation of the individual in his or her 
customary environment;
    (ii) Purchasing, leasing, or otherwise providing for the acquisition 
by an individual with a disability of an assistive technology device;
    (iii) Selecting, designing, fitting, customizing, adapting, 
applying, maintaining, repairing, or replacing assistive technology 
devices;
    (iv) Coordinating and using other therapies, interventions, or 
services with assistive technology devices, such as those associated 
with existing education and rehabilitation plans and programs;
    (v) Training or technical assistance for an individual with a 
disability or, if appropriate, the family members, guardians, advocates, 
or authorized representatives of the individual; and
    (vi) Training or technical assistance for professionals (including 
individuals providing education and rehabilitation services), employers, 
or others who provide services to, employ, or are otherwise 
substantially involved in the major life functions of individuals with 
disabilities, to the extent that training or technical assistance is 
necessary to the achievement of an employment outcome by an individual 
with a disability.


(Authority: Sections 7(4) and 12(c) of the Act; 29 U.S.C. 705(4) and 
709(c))

    (9) Community rehabilitation program.
    (i) Community rehabilitation program means a program that provides 
directly or facilitates the provision of one or more of the following 
vocational rehabilitation services to individuals with disabilities to 
enable those individuals to maximize their opportunities for employment, 
including career advancement:

[[Page 247]]

    (A) Medical, psychiatric, psychological, social, and vocational 
services that are provided under one management.
    (B) Testing, fitting, or training in the use of prosthetic and 
orthotic devices.
    (C) Recreational therapy.
    (D) Physical and occupational therapy.
    (E) Speech, language, and hearing therapy.
    (F) Psychiatric, psychological, and social services, including 
positive behavior management.
    (G) Assessment for determining eligibility and vocational 
rehabilitation needs.
    (H) Rehabilitation technology.
    (I) Job development, placement, and retention services.
    (J) Evaluation or control of specific disabilities.
    (K) Orientation and mobility services for individuals who are blind.
    (L) Extended employment.
    (M) Psychosocial rehabilitation services.
    (N) Supported employment services and extended services.
    (O) Services to family members if necessary to enable the applicant 
or eligible individual to achieve an employment outcome.
    (P) Personal assistance services.
    (Q) Services similar to the services described in paragraphs (A) 
through (P) of this definition.
    (ii) For the purposes of this definition, the word program means an 
agency, organization, or institution, or unit of an agency, 
organization, or institution, that provides directly or facilitates the 
provision of vocational rehabilitation services as one of its major 
functions.
    (10) Comparable services and benefits means--
    (i) Services and benefits that are--
    (A) Provided or paid for, in whole or in part, by other Federal, 
State, or local public agencies, by health insurance, or by employee 
benefits;
    (B) Available to the individual at the time needed to ensure the 
progress of the individual toward achieving the employment outcome in 
the individual's individualized plan for employment in accordance with 
Sec. 361.53; and
    (C) Commensurate to the services that the individual would otherwise 
receive from the designated State vocational rehabilitation agency.
    (ii) For the purposes of this definition, comparable benefits do not 
include awards and scholarships based on merit.


(Authority: Sections 12(c) and 101(a)(8) of the Act; 29 U.S.C. 709(c) 
and 721(a)(8))

    (11) Competitive employment means work--
    (i) In the competitive labor market that is performed on a full-time 
or part-time basis in an integrated setting; and
    (ii) For which an individual is compensated at or above the minimum 
wage, but not less than the customary wage and level of benefits paid by 
the employer for the same or similar work performed by individuals who 
are not disabled.


(Authority: Sections 7(11) and 12(c) of the Act; 29 U.S.C. 705(11) and 
709(c))

    (12) Construction of a facility for a public or nonprofit community 
rehabilitation program means--
    (i) The acquisition of land in connection with the construction of a 
new building for a community rehabilitation program;
    (ii) The construction of new buildings;
    (iii) The acquisition of existing buildings;
    (iv) The expansion, remodeling, alteration, or renovation of 
existing buildings;
    (v) Architect's fees, site surveys, and soil investigation, if 
necessary, in connection with the construction project;
    (vi) The acquisition of initial fixed or movable equipment of any 
new, newly acquired, newly expanded, newly remodeled, newly altered, or 
newly renovated buildings that are to be used for community 
rehabilitation program purposes; and
    (vii) Other direct expenditures appropriate to the construction 
project, except costs of off-site improvements.


(Authority: Sections 7(6) and 12(c) of the Act; 29 U.S.C. 705(6) and 
709(c))

    (13) Designated State agency or State agency means the sole State 
agency,

[[Page 248]]

designated in accordance with Sec. 361.13(a), to administer, or 
supervise the local administration of, the State plan for vocational 
rehabilitation services. The term includes the State agency for 
individuals who are blind, if designated as the sole State agency with 
respect to that part of the plan relating to the vocational 
rehabilitation of individuals who are blind.


(Authority: Sections 7(8)(A) and 101(a)(2)(A) of the Act; 29 U.S.C. 
705(8)(A) and 721(a)(2)(A))

    (14) Designated State unit or State unit means either--
    (i) The State vocational rehabilitation bureau, division, or other 
organizational unit that is primarily concerned with vocational 
rehabilitation or vocational and other rehabilitation of individuals 
with disabilities and that is responsible for the administration of the 
vocational rehabilitation program of the State agency, as required under 
Sec. 361.13(b); or
    (ii) The State agency that is primarily concerned with vocational 
rehabilitation or vocational and other rehabilitation of individuals 
with disabilities.


(Authority: Sections 7(8)(B) and 101(a)(2)(B) of the Act; 29 U.S.C. 
705(8)(B) and 721(a)(2)(B))

    (15) Eligible individual means an applicant for vocational 
rehabilitation services who meets the eligibility requirements of Sec. 
361.42(a).


(Authority: Sections 7(20)(A) and 102(a)(1) of the Act; 29 U.S.C. 
705(20)(A) and 722(a)(1))

    (16) Employment outcome means, with respect to an individual, 
entering or retaining full-time or, if appropriate, part-time 
competitive employment, as defined in Sec. 361.5(b)(11), in the 
integrated labor market, supported employment, or any other type of 
employment in an integrated setting, including self-employment, 
telecommuting, or business ownership, that is consistent with an 
individual's strengths, resources, priorities, concerns, abilities, 
capabilities, interests, and informed choice.


(Authority: Sections 7(11), 12(c), 100(a)(2), and 102(b)(3)(A) of the 
Act; 29 U.S.C. 705(11), 709(c), 720(a)(2), and 722(b)(3)(A))

    (17) Establishment, development, or improvement of a public or 
nonprofit community rehabilitation program means--
    (i) The establishment of a facility for a public or nonprofit 
community rehabilitation program as defined in paragraph (b)(18) of this 
section to provide vocational rehabilitation services to applicants or 
eligible individuals;
    (ii) Staffing, if necessary to establish, develop, or improve a 
community rehabilitation program for the purpose of providing vocational 
rehabilitation services to applicants or eligible individuals, for a 
maximum period of 4 years, with Federal financial participation 
available at the applicable matching rate for the following levels of 
staffing costs:
    (A) 100 percent of staffing costs for the first year.
    (B) 75 percent of staffing costs for the second year.
    (C) 60 percent of staffing costs for the third year.
    (D) 45 percent of staffing costs for the fourth year; and
    (iii) Other expenditures related to the establishment, development, 
or improvement of a community rehabilitation program that are necessary 
to make the program functional or increase its effectiveness in 
providing vocational rehabilitation services to applicants or eligible 
individuals, but are not ongoing operating expenses of the program.


(Authority: Sections 7(12) and 12(c) of the Act; 29 U.S.C. 705(12) and 
709(c))

    (18) Establishment of a facility for a public or nonprofit community 
rehabilitation program means--
    (i) The acquisition of an existing building and, if necessary, the 
land in connection with the acquisition, if the building has been 
completed in all respects for at least 1 year prior to the date of 
acquisition and the Federal share of the cost of acquisition is not more 
than $300,000;
    (ii) The remodeling or alteration of an existing building, provided 
the estimated cost of remodeling or alteration does not exceed the 
appraised value of the existing building;
    (iii) The expansion of an existing building, provided that--

[[Page 249]]

    (A) The existing building is complete in all respects;
    (B) The total size in square footage of the expanded building, 
notwithstanding the number of expansions, is not greater than twice the 
size of the existing building;
    (C) The expansion is joined structurally to the existing building 
and does not constitute a separate building; and
    (D) The costs of the expansion do not exceed the appraised value of 
the existing building;
    (iv) Architect's fees, site survey, and soil investigation, if 
necessary in connection with the acquisition, remodeling, alteration, or 
expansion of an existing building; and
    (v) The acquisition of fixed or movable equipment, including the 
costs of installation of the equipment, if necessary to establish, 
develop, or improve a community rehabilitation program.


(Authority: Sections 7(12) and 12(c) of the Act; 29 U.S.C. 705(12) and 
709(c))

    (19) Extended employment means work in a non-integrated or sheltered 
setting for a public or private nonprofit agency or organization that 
provides compensation in accordance with the Fair Labor Standards Act.


(Authority: Section 12(c) of the Act; 29 U.S.C. 709(c))

    (20) Extended services means ongoing support services and other 
appropriate services that are needed to support and maintain an 
individual with a most significant disability in supported employment 
and that are provided by a State agency, a private nonprofit 
organization, employer, or any other appropriate resource, from funds 
other than funds received under this part and 34 CFR part 363 after an 
individual with a most significant disability has made the transition 
from support provided by the designated State unit.


(Authority: Sections 7(13) and 623 of the Act; 29 U.S.C. 705(13) and 
795i)

    (21) Extreme medical risk means a probability of substantially 
increasing functional impairment or death if medical services, including 
mental health services, are not provided expeditiously.


(Authority: Sections 12(c) and 101(a)(8)(A)(i)(III) of the Act; 29 
U.S.C. 709(c) and 721(a)(8)(A)(i)(III))

    (22) Fair hearing board means a committee, body, or group of persons 
established by a State prior to January 1, 1985 that--
    (i) Is authorized under State law to review determinations made by 
personnel of the designated State unit that affect the provision of 
vocational rehabilitation services; and
    (ii) Carries out the responsibilities of the impartial hearing 
officer in accordance with the requirements in Sec. 361.57(j).


(Authority: Section 12(c) of the Act; 29 U.S.C. 709(c))

    (23) Family member, for purposes of receiving vocational 
rehabilitation services in accordance with Sec. 361.48(i), means an 
individual--
    (i) Who either--
    (A) Is a relative or guardian of an applicant or eligible 
individual; or
    (B) Lives in the same household as an applicant or eligible 
individual;
    (ii) Who has a substantial interest in the well-being of that 
individual; and
    (iii) Whose receipt of vocational rehabilitation services is 
necessary to enable the applicant or eligible individual to achieve an 
employment outcome.


(Authority: Sections 12(c) and 103(a)(17) of the Act; 29 U.S.C. 709(c) 
and 723(a)(17))

    (24) Governor means a chief executive officer of a State.


(Authority: Section 7(15) of the Act; 29 U.S.C. 705(15))

    (25) Impartial hearing officer.
    (i) Impartial hearing officer means an individual who--
    (A) Is not an employee of a public agency (other than an 
administrative law judge, hearing examiner, or employee of an 
institution of higher education);
    (B) Is not a member of the State Rehabilitation Council for the 
designated State unit;
    (C) Has not been involved previously in the vocational 
rehabilitation of the applicant or eligible individual;

[[Page 250]]

    (D) Has knowledge of the delivery of vocational rehabilitation 
services, the State plan, and the Federal and State regulations 
governing the provision of services;
    (E) Has received training with respect to the performance of 
official duties; and
    (F) Has no personal, professional, or financial interest that would 
be in conflict with the objectivity of the individual.
    (ii) An individual is not considered to be an employee of a public 
agency for the purposes of this definition solely because the individual 
is paid by the agency to serve as a hearing officer.


(Authority: Section 7(16) of the Act; 29 U.S.C. 705(16))

    (26) Indian tribe means any Federal or State Indian tribe, band, 
rancheria, pueblo, colony, or community, including any Alaskan native 
village or regional village corporation (as defined in or established 
pursuant to the Alaska Native Claims Settlement Act).


(Authority: Section 7(19)(B) of the Act; 29 U.S.C. 705(19)(B))

    (27) Individual who is blind means a person who is blind within the 
meaning of applicable State law. (Authority: Section 12(c) of the Act; 
29 U.S.C. 709(c))
    (28) Individual with a disability, except as provided in Sec. 
361.5(b)(29), means an individual--
    (i) Who has a physical or mental impairment;
    (ii) Whose impairment constitutes or results in a substantial 
impediment to employment; and
    (iii) Who can benefit in terms of an employment outcome from the 
provision of vocational rehabilitation services.


(Authority: Section 7(20)(A) of the Act; 29 U.S.C. 705(20)(A))

    (29) Individual with a disability, for purposes of Sec. Sec. 
361.5(b)(14), 361.13(a), 361.13(b)(1), 361.17(a), (b), (c), and (j), 
361.18(b), 361.19, 361.20, 361.23(b)(2), 361.29(a) and (d)(5), and 
361.51(b), means an individual--
    (i) Who has a physical or mental impairment that substantially 
limits one or more major life activities;
    (ii) Who has a record of such an impairment; or
    (iii) Who is regarded as having such an impairment.


(Authority: Section 7(20)(B) of the Act; 29 U.S.C. 705(20)(B))

    (30) Individual with a most significant disability means an 
individual with a significant disability who meets the designated State 
unit's criteria for an individual with a most significant disability. 
These criteria must be consistent with the requirements in Sec. 
361.36(d)(1) and (2).


(Authority: Sections 7(21)(E)(i) and 101(a)(5)(C) of the Act; 29 U.S.C. 
705(21)(E)(i) and 721(a)(5)(C))

    (31) Individual with a significant disability means an individual 
with a disability--
    (i) Who has a severe physical or mental impairment that seriously 
limits one or more functional capacities (such as mobility, 
communication, self-care, self-direction, interpersonal skills, work 
tolerance, or work skills) in terms of an employment outcome;
    (ii) Whose vocational rehabilitation can be expected to require 
multiple vocational rehabilitation services over an extended period of 
time; and
    (iii) Who has one or more physical or mental disabilities resulting 
from amputation, arthritis, autism, blindness, burn injury, cancer, 
cerebral palsy, cystic fibrosis, deafness, head injury, heart disease, 
hemiplegia, hemophilia, respiratory or pulmonary dysfunction, mental 
retardation, mental illness, multiple sclerosis, muscular dystrophy, 
musculo-skeletal disorders, neurological disorders (including stroke and 
epilepsy), spinal cord conditions (including paraplegia and 
quadriplegia), sickle cell anemia, specific learning disability, end-
stage renal disease, or another disability or combination of 
disabilities determined on the basis of an assessment for determining 
eligibility and vocational rehabilitation needs to cause comparable 
substantial functional limitation.


(Authority: Section 7(21)(A) of the Act; 29 U.S.C. 705(21)(A))


[[Page 251]]


    (32) Individual's representative means any representative chosen by 
an applicant or eligible individual, as appropriate, including a parent, 
guardian, other family member, or advocate, unless a representative has 
been appointed by a court to represent the individual, in which case the 
court-appointed representative is the individual's representative.


(Authority: Sections 7(22) and 12(c) of the Act; 29 U.S.C. 705(22) and 
709(c))

    (33) Integrated setting,--
    (i) With respect to the provision of services, means a setting 
typically found in the community in which applicants or eligible 
individuals interact with non-disabled individuals other than non-
disabled individuals who are providing services to those applicants or 
eligible individuals;
    (ii) With respect to an employment outcome, means a setting 
typically found in the community in which applicants or eligible 
individuals interact with non-disabled individuals, other than non-
disabled individuals who are providing services to those applicants or 
eligible individuals, to the same extent that non-disabled individuals 
in comparable positions interact with other persons.


(Authority: Section 12(c) of the Act; 29 U.S.C. 709(c))

    (34) Local workforce investment board means a local workforce 
investment board established under section 117 of the Workforce 
Investment Act of 1998.


(Authority: Section 7(25) of the Act; 29 U.S.C. 705(25))

    (35) Maintenance means monetary support provided to an individual 
for expenses, such as food, shelter, and clothing, that are in excess of 
the normal expenses of the individual and that are necessitated by the 
individual's participation in an assessment for determining eligibility 
and vocational rehabilitation needs or the individual's receipt of 
vocational rehabilitation services under an individualized plan for 
employment.


(Authority: Sections 12(c) and 103(a)(7) of the Act; 29 U.S.C. 709(c) 
and 723(a)(7))

    (i) Examples: The following are examples of expenses that would meet 
the definition of maintenance. The examples are illustrative, do not 
address all possible circumstances, and are not intended to substitute 
for individual counselor judgment.

    Example 1: The cost of a uniform or other suitable clothing that is 
required for an individual's job placement or job-seeking activities.
    Example 2: The cost of short-term shelter that is required in order 
for an individual to participate in assessment activities or vocational 
training at a site that is not within commuting distance of an 
individual's home.
    Example 3: The initial one-time costs, such as a security deposit or 
charges for the initiation of utilities, that are required in order for 
an individual to relocate for a job placement.
    Example 4: The costs of an individual's participation in enrichment 
activities related to that individual's training program.

    (ii) [Reserved]
    (36) Mediation means the act or process of using an independent 
third party to act as a mediator, intermediary, or conciliator to assist 
persons or parties in settling differences or disputes prior to pursuing 
formal administrative or other legal remedies. Mediation under the 
program must be conducted in accordance with the requirements in Sec. 
361.57(d) by a qualified and impartial mediator as defined in Sec. 
361.5(b)(43).


(Authority: Section 12(c) of the Act; 29 U.S.C. 709(c))

    (37) Nonprofit, with respect to a community rehabilitation program, 
means a community rehabilitation program carried out by a corporation or 
association, no part of the net earnings of which inures, or may 
lawfully inure, to the benefit of any private shareholder or individual 
and the income of which is exempt from taxation under section 501(c)(3) 
of the Internal Revenue Code of 1986.


(Authority: Section 7(26) of the Act; 29 U.S.C. 705(26))

    (38) Ongoing support services, as used in the definition of 
``Supported employment''
    (i) Means services that are--
    (A) Needed to support and maintain an individual with a most 
significant disability in supported employment;

[[Page 252]]

    (B) Identified based on a determination by the designated State unit 
of the individual's need as specified in an individualized plan for 
employment; and
    (C) Furnished by the designated State unit from the time of job 
placement until transition to extended services, unless post-employment 
services are provided following transition, and thereafter by one or 
more extended services providers throughout the individual's term of 
employment in a particular job placement or multiple placements if those 
placements are being provided under a program of transitional 
employment;
    (ii) Must include an assessment of employment stability and 
provision of specific services or the coordination of services at or 
away from the worksite that are needed to maintain stability based on--
    (A) At a minimum, twice-monthly monitoring at the worksite of each 
individual in supported employment; or
    (B) If under specific circumstances, especially at the request of 
the individual, the individualized plan for employment provides for off-
site monitoring, twice monthly meetings with the individual;
    (iii) Consist of--
    (A) Any particularized assessment supplementary to the comprehensive 
assessment of rehabilitation needs described in paragraph (b)(6)(ii) of 
this section;
    (B) The provision of skilled job trainers who accompany the 
individual for intensive job skill training at the work site;
    (C) Job development and training;
    (D) Social skills training;
    (E) Regular observation or supervision of the individual;
    (F) Follow-up services including regular contact with the employers, 
the individuals, the parents, family members, guardians, advocates or 
authorized representatives of the individuals, and other suitable 
professional and informed advisors, in order to reinforce and stabilize 
the job placement;
    (G) Facilitation of natural supports at the worksite;
    (H) Any other service identified in the scope of vocational 
rehabilitation services for individuals, described in Sec. 361.48; or
    (I) Any service similar to the foregoing services.


(Authority: Sections 7(27) and 12(c) of the Act; 29 U.S.C. 705(27) and 
709(c))

    (39) Personal assistance services means a range of services provided 
by one or more persons designed to assist an individual with a 
disability to perform daily living activities on or off the job that the 
individual would typically perform without assistance if the individual 
did not have a disability. The services must be designed to increase the 
individual's control in life and ability to perform everyday activities 
on or off the job. The services must be necessary to the achievement of 
an employment outcome and may be provided only while the individual is 
receiving other vocational rehabilitation services. The services may 
include training in managing, supervising, and directing personal 
assistance services.


(Authority: Sections 7(28), 102(b)(3)(B)(i)(I), and 103(a)(9) of the 
Act; 29 U.S.C. 705(28), 722(b)(3)(B)(i)(I), and 723(a)(9))

    (40) Physical and mental restoration services means--
    (i) Corrective surgery or therapeutic treatment that is likely, 
within a reasonable period of time, to correct or modify substantially a 
stable or slowly progressive physical or mental impairment that 
constitutes a substantial impediment to employment;
    (ii) Diagnosis of and treatment for mental or emotional disorders by 
qualified personnel in accordance with State licensure laws;
    (iii) Dentistry;
    (iv) Nursing services;
    (v) Necessary hospitalization (either inpatient or outpatient care) 
in connection with surgery or treatment and clinic services;
    (vi) Drugs and supplies;
    (vii) Prosthetic and orthotic devices;
    (viii) Eyeglasses and visual services, including visual training, 
and the examination and services necessary for the prescription and 
provision of eyeglasses, contact lenses, microscopic lenses, telescopic 
lenses, and other special visual aids prescribed by personnel

[[Page 253]]

that are qualified in accordance with State licensure laws;
    (ix) Podiatry;
    (x) Physical therapy;
    (xi) Occupational therapy;
    (xii) Speech or hearing therapy;
    (xiii) Mental health services;
    (xiv) Treatment of either acute or chronic medical complications and 
emergencies that are associated with or arise out of the provision of 
physical and mental restoration services, or that are inherent in the 
condition under treatment;
    (xv) Special services for the treatment of individuals with end-
stage renal disease, including transplantation, dialysis, artificial 
kidneys, and supplies; and
    (xvi) Other medical or medically related rehabilitation services.


(Authority: Sections 12(c) and 103(a)(6) of the Act; 29 U.S.C. 709(c) 
and 723(a)(6))

    (41) Physical or mental impairment means--
    (i) Any physiological disorder or condition, cosmetic disfigurement, 
or anatomical loss affecting one or more of the following body systems: 
neurological, musculo-skeletal, special sense organs, respiratory 
(including speech organs), cardiovascular, reproductive, digestive, 
genitourinary, hemic and lymphatic, skin, and endocrine; or
    (ii) Any mental or psychological disorder such as mental 
retardation, organic brain syndrome, emotional or mental illness, and 
specific learning disabilities.


(Authority: Sections 7(20)(A) and 12(c) of the Act; 29 U.S.C. 705(20)(A) 
and 709(c))

    (42) Post-employment services means one or more of the services 
identified in Sec. 361.48 that are provided subsequent to the 
achievement of an employment outcome and that are necessary for an 
individual to maintain, regain, or advance in employment, consistent 
with the individual's strengths, resources, priorities, concerns, 
abilities, capabilities, interests, and informed choice.


(Authority: Sections 12(c) and 103(a)(18) of the Act; 29 U.S.C. 709(c)) 
and 723(a)(18))

    Note to paragraph (b)(42): Post-employment services are intended to 
ensure that the employment outcome remains consistent with the 
individual's strengths, resources, priorities, concerns, abilities, 
capabilities, interests, and informed choice. These services are 
available to meet rehabilitation needs that do not require a complex and 
comprehensive provision of services and, thus, should be limited in 
scope and duration. If more comprehensive services are required, then a 
new rehabilitation effort should be considered. Post-employment services 
are to be provided under an amended individualized plan for employment; 
thus, a re-determination of eligibility is not required. The provision 
of post-employment services is subject to the same requirements in this 
part as the provision of any other vocational rehabilitation service. 
Post-employment services are available to assist an individual to 
maintain employment, e.g., the individual's employment is jeopardized 
because of conflicts with supervisors or co-workers, and the individual 
needs mental health services and counseling to maintain the employment; 
to regain employment, e.g., the individual's job is eliminated through 
reorganization and new placement services are needed; and to advance in 
employment, e.g., the employment is no longer consistent with the 
individual's strengths, resources, priorities, concerns, abilities, 
capabilities, interests, and informed choice.

    (43) Qualified and impartial mediator.
    (i) Qualified and impartial mediator means an individual who--
    (A) Is not an employee of a public agency (other than an 
administrative law judge, hearing examiner, employee of a State office 
of mediators, or employee of an institution of higher education);
    (B) Is not a member of the State Rehabilitation Council for the 
designated State unit;
    (C) Has not been involved previously in the vocational 
rehabilitation of the applicant or eligible individual;
    (D) Is knowledgeable of the vocational rehabilitation program and 
the applicable Federal and State laws, regulations, and policies 
governing the provision of vocational rehabilitation services;
    (E) Has been trained in effective mediation techniques consistent 
with any State-approved or -recognized certification, licensing, 
registration, or other requirements; and
    (F) Has no personal, professional, or financial interest that would 
be in conflict with the objectivity of the individual during the 
mediation proceedings.

[[Page 254]]

    (ii) An individual serving as a mediator is not considered to be an 
employee of the designated State agency or designated State unit for the 
purposes of this definition solely because the individual is paid by the 
designated State agency or designated State unit to serve as a mediator.


(Authority: Sections 12(c) and 102(c)(4) of the Act; 29 U.S.C. 709(c) 
and 722(c)(4))

    (44) Rehabilitation engineering means the systematic application of 
engineering sciences to design, develop, adapt, test, evaluate, apply, 
and distribute technological solutions to problems confronted by 
individuals with disabilities in functional areas, such as mobility, 
communications, hearing, vision, and cognition, and in activities 
associated with employment, independent living, education, and 
integration into the community.


(Authority: Section 7(12)(c) of the Act; 29 U.S.C. 709(c))

    (45) Rehabilitation technology means the systematic application of 
technologies, engineering methodologies, or scientific principles to 
meet the needs of, and address the barriers confronted by, individuals 
with disabilities in areas that include education, rehabilitation, 
employment, transportation, independent living, and recreation. The term 
includes rehabilitation engineering, assistive technology devices, and 
assistive technology services.


(Authority: Section 7(30) of the Act; 29 U.S.C. 705(30))

    (46) Reservation means a Federal or State Indian reservation, public 
domain Indian allotment, former Indian reservation in Oklahoma, and land 
held by incorporated Native groups, regional corporations, and village 
corporations under the provisions of the Alaska Native Claims Settlement 
Act.


(Authority: Section 121(c) of the Act; 29 U.S.C. 741(c))

    (47) Sole local agency means a unit or combination of units of 
general local government or one or more Indian tribes that has the sole 
responsibility under an agreement with, and the supervision of, the 
State agency to conduct a local or tribal vocational rehabilitation 
program, in accordance with the State plan.


(Authority: Section 7(24) of the Act; 29 U.S.C. 705(24))

    (48) State means any of the 50 States, the District of Columbia, the 
Commonwealth of Puerto Rico, the United States Virgin Islands, Guam, 
American Samoa, and the Commonwealth of the Northern Mariana Islands.


(Authority: Section 7(32) of the Act; 29 U.S.C. 705(32))

    (49) State workforce investment board means a State workforce 
investment board established under section 111 of the Workforce 
Investment Act of 1998.


(Authority: Section 7(33) of the Act; 29 U.S.C. 705(33))

    (50) Statewide workforce investment system means a system described 
in section 111(d)(2) of the Workforce Investment Act of 1998.


(Authority: Section 7(34) of the Act; 29 U.S.C. 705(34))

    (51) State plan means the State plan for vocational rehabilitation 
services submitted under Sec. 361.10.


(Authority: Sections 12(c) and 101 of the Act; 29 U.S.C. 709(c) and 721)

    (52) Substantial impediment to employment means that a physical or 
mental impairment (in light of attendant medical, psychological, 
vocational, educational, communication, and other related factors) 
hinders an individual from preparing for, entering into, engaging in, or 
retaining employment consistent with the individual's abilities and 
capabilities.


(Authority: Sections 7(20)(A) and 12(c) of the Act; 29 U.S.C. 705(20)(A) 
and 709(c))

    (53) Supported employment means--
    (i) Competitive employment in an integrated setting, or employment 
in integrated work settings in which individuals are working toward 
competitive employment, consistent with the strengths, resources, 
priorities, concerns, abilities, capabilities, interests, and informed 
choice of the individuals

[[Page 255]]

with ongoing support services for individuals with the most significant 
disabilities--
    (A) For whom competitive employment has not traditionally occurred 
or for whom competitive employment has been interrupted or intermittent 
as a result of a significant disability; and
    (B) Who, because of the nature and severity of their disabilities, 
need intensive supported employment services from the designated State 
unit and extended services after transition as described in paragraph 
(b)(20) of this section to perform this work; or
    (ii) Transitional employment, as defined in paragraph (b)(54) of 
this section, for individuals with the most significant disabilities due 
to mental illness.


(Authority: Section 7(35) of the Act; 29 U.S.C. 705(35))

    (54) Supported employment services means ongoing support services 
and other appropriate services needed to support and maintain an 
individual with a most significant disability in supported employment 
that are provided by the designated State unit--
    (i) For a period of time not to exceed 18 months, unless under 
special circumstances the eligible individual and the rehabilitation 
counselor or coordinator jointly agree to extend the time to achieve the 
employment outcome identified in the individualized plan for employment; 
and
    (ii) Following transition, as post-employment services that are 
unavailable from an extended services provider and that are necessary to 
maintain or regain the job placement or advance in employment.


(Authority: Sections 7(36) and 12(c) of the Act; 29 U.S.C. 705(36) and 
709(c))

    (55) Transition services means a coordinated set of activities for a 
student designed within an outcome-oriented process that promotes 
movement from school to post-school activities, including postsecondary 
education, vocational training, integrated employment (including 
supported employment), continuing and adult education, adult services, 
independent living, or community participation. The coordinated set of 
activities must be based upon the individual student's needs, taking 
into account the student's preferences and interests, and must include 
instruction, community experiences, the development of employment and 
other post-school adult living objectives, and, if appropriate, 
acquisition of daily living skills and functional vocational evaluation. 
Transition services must promote or facilitate the achievement of the 
employment outcome identified in the student's individualized plan for 
employment.


(Authority: Section 7(37) and 103(a)(15) of the Act; 29 U.S.C. 705(37) 
and 723(a)(15))

    (56) Transitional employment, as used in the definition of 
``Supported employment,'' means a series of temporary job placements in 
competitive work in integrated settings with ongoing support services 
for individuals with the most significant disabilities due to mental 
illness. In transitional employment, the provision of ongoing support 
services must include continuing sequential job placements until job 
permanency is achieved.


(Authority: Sections 7(35)(B) and 12(c) of the Act; 29 U.S.C. 705(35)(B) 
and 709(c)

    (57) Transportation means travel and related expenses that are 
necessary to enable an applicant or eligible individual to participate 
in a vocational rehabilitation service, including expenses for training 
in the use of public transportation vehicles and systems.


(Authority: 103(a)(8) of the Act; 29 U.S.C. 723(a)(8))

    (i) Examples: The following are examples of expenses that would meet 
the definition of transportation. The examples are purely illustrative, 
do not address all possible circumstances, and are not intended to 
substitute for individual counselor judgment.

    Example 1: Travel and related expenses for a personal care attendant 
or aide if the services of that person are necessary to enable the 
applicant or eligible individual to travel to participate in any 
vocational rehabilitation service.
    Example 2: The purchase and repair of vehicles, including vans, but 
not the modification of these vehicles, as modification would be 
considered a rehabilitation technology service.

[[Page 256]]

    Example 3: Relocation expenses incurred by an eligible individual in 
connection with a job placement that is a significant distance from the 
eligible individual's current residence.

    (ii) [Reserved]
    (58) Vocational rehabilitation services--
    (i) If provided to an individual, means those services listed in 
Sec. 361.48; and
    (ii) If provided for the benefit of groups of individuals, also 
means those services listed in Sec. 361.49.


(Authority: Sections 7(38) and 103(a) and (b) of the Act; 29 U.S.C. 
705(38), 723(a) and (b))

66 FR 4382, Jan. 17, 2001, as amended at 66 FR 7252, Jan. 22, 2001]



       Subpart B_State Plan and Other Requirements for Vocational 
                         Rehabilitation Services



Sec. 361.10  Submission, approval, and disapproval of the State plan.

    (a) Purpose. For a State to receive a grant under this part, the 
designated State agency must submit to the Secretary, and obtain 
approval of, a State plan that contains a description of the State's 
vocational rehabilitation services program, the plans and policies to be 
followed in carrying out the program, and other information requested by 
the Secretary, in accordance with the requirements of this part.
    (b) Separate part relating to the vocational rehabilitation of 
individuals who are blind. If a separate State agency administers or 
supervises the administration of a separate part of the State plan 
relating to the vocational rehabilitation of individuals who are blind, 
that part of the State plan must separately conform to all requirements 
under this part that are applicable to a State plan.
    (c) State unified plan. The State may choose to submit the State 
plan for vocational rehabilitation services as part of the State unified 
plan under section 501 of the Workforce Investment Act of 1998. The 
portion of the State unified plan that includes the State plan for 
vocational rehabilitation services must meet the State plan requirements 
in this part.
    (d) Public participation. Prior to the adoption of any substantive 
policies or procedures governing the provision of vocational 
rehabilitation services under the State plan, including making any 
substantive amendment to those policies and procedures, the designated 
State agency must conduct public meetings throughout the State, in 
accordance with the requirements of Sec. 361.20.
    (e) Duration. The State plan remains in effect subject to the 
submission of modifications the State determines to be necessary or the 
Secretary may require based on a change in State policy, a change in 
Federal law, including regulations, an interpretation of the Act by a 
Federal court or the highest court of the State, or a finding by the 
Secretary of State noncompliance with the requirements of the Act or 
this part.
    (f) Submission of the State plan. The State must submit the State 
plan for approval--
    (1) To the Secretary on the same date that the State submits a State 
plan relating to the statewide workforce investment system under section 
112 of the Workforce Investment Act of 1998;
    (2) As part of the State unified plan submitted under section 501 of 
that Act; or
    (3) To the Secretary on the same date that the State submits a State 
unified plan under section 501 of that Act that does not include the 
State plan under this part.
    (g) Annual submission. (1) The State must submit to the Secretary 
for approval revisions to the State plan in accordance with paragraph 
(e) of this section and 34 CFR 76.140.
    (2) The State must submit to the Secretary reports containing annual 
updates of the information required under Sec. Sec. 361.18, 361.29, and 
361.35 and any other updates of the information required under this part 
that are requested by the Secretary.
    (3) The State is not required to submit policies, procedures, or 
descriptions required under this part that have been previously 
submitted to the Secretary and that demonstrate that the State meets the 
requirements of this part, including any policies, procedures, or 
descriptions submitted under this part that are in effect on August 6, 
1998.

[[Page 257]]

    (h) Approval. The Secretary approves any State plan and any 
revisions to the State plan that conform to the requirements of this 
part and section 101(a) of the Act.
    (i) Disapproval. The Secretary disapproves any State plan that does 
not conform to the requirements of this part and section 101(a) of the 
Act, in accordance with the following procedures:
    (1) Informal resolution. Prior to disapproving any State plan, the 
Secretary attempts to resolve disputes informally with State officials.
    (2) Notice. If, after reasonable effort has been made to resolve the 
dispute, no resolution has been reached, the Secretary provides notice 
to the State agency of the intention to disapprove the State plan and of 
the opportunity for a hearing.
    (3) State plan hearing. If the State agency requests a hearing, the 
Secretary designates one or more individuals, either from the Department 
or elsewhere, not responsible for or connected with the administration 
of this Program, to conduct a hearing in accordance with the provisions 
of 34 CFR part 81, subpart A.
    (4) Initial decision. The hearing officer issues an initial decision 
in accordance with 34 CFR 81.41.
    (5) Petition for review of an initial decision. The State agency may 
seek the Secretary's review of the initial decision in accordance with 
34 CFR part 81.
    (6) Review by the Secretary. The Secretary reviews the initial 
decision in accordance with 34 CFR 81.43.
    (7) Final decision of the Department. The final decision of the 
Department is made in accordance with 34 CFR 81.44.
    (8) Judicial review. A State may appeal the Secretary's decision to 
disapprove the State plan by filing a petition for review with the 
United States Court of Appeals for the circuit in which the State is 
located, in accordance with section 107(d) of the Act.

(Approved by the Office of Management and Budget under control number 
1820-0500)

(Authority: Sections 101(a) and (b), and 107(d) of the Act; 20 U.S.C. 
1231g(a); and 29 U.S.C. 721(a) and (b), and 727(d))

[66 FR 4382, Jan. 17, 2001, as amended at 66 FR 7253, Jan. 22, 2001]



Sec. 361.11  Withholding of funds.

    (a) Basis for withholding. The Secretary may withhold or limit 
payments under section 111 or 622(a) of the Act, as provided by section 
107(c) and (d) of the Act, if the Secretary determines that--
    (1) The State plan, including the supported employment supplement, 
has been so changed that it no longer conforms with the requirements of 
this part or 34 CFR part 363; or
    (2) In the administration of the State plan, there has been a 
failure to comply substantially with any provision of that plan or a 
program improvement plan established in accordance with section 
106(b)(2) of the Act.
    (b) Informal resolution. Prior to withholding or limiting payments 
in accordance with this section, the Secretary attempts to resolve 
disputed issues informally with State officials.
    (c) Notice. If, after reasonable effort has been made to resolve the 
dispute, no resolution has been reached, the Secretary provides notice 
to the State agency of the intention to withhold or limit payments and 
of the opportunity for a hearing.
    (d) Withholding hearing. If the State agency requests a hearing, the 
Secretary designates one or more individuals, either from the Department 
or elsewhere, not responsible for or connected with the administration 
of this Program, to conduct a hearing in accordance with the provisions 
of 34 CFR part 81, subpart A.
    (e) Initial decision. The hearing officer issues an initial decision 
in accordance with 34 CFR 81.41.
    (f) Petition for review of an initial decision. The State agency may 
seek the Secretary's review of the initial decision in accordance with 
34 CFR 81.42.
    (g) Review by the Secretary. The Secretary reviews the initial 
decision in accordance with 34 CFR 81.43.
    (h) Final decision of the Department. The final decision of the 
Department is made in accordance with 34 CFR 81.44.
    (i) Judicial review. A State may appeal the Secretary's decision to 
withhold or limit payments by filing a petition for review with the U.S. 
Court of Appeals for the circuit in which the

[[Page 258]]

State is located, in accordance with section 107(d) of the Act.

(Authority: Sections 101(b), 107(c), and 107(d) of the Act; 29 U.S.C. 
721(b), 727(c)(1) and (2), and 727(d))

                             Administration



Sec. 361.12  Methods of administration.

    The State plan must assure that the State agency, and the designated 
State unit if applicable, employs methods of administration found 
necessary by the Secretary for the proper and efficient administration 
of the plan and for carrying out all functions for which the State is 
responsible under the plan and this part. These methods must include 
procedures to ensure accurate data collection and financial 
accountability.

(Approved by the Office of Management and Budget under control number 
1820-0500)

(Authority: Sections 101(a)(6) and (a)(10)(A) of the Act; 29 U.S.C. 
721(a)(6) and (a)(10)(A))

[66 FR 4382, Jan. 17, 2001, as amended at 66 FR 7253, Jan. 22, 2001]



Sec. 361.13  State agency for administration.

    (a) Designation of State agency. The State plan must designate a 
State agency as the sole State agency to administer the State plan, or 
to supervise its administration in a political subdivision of the State 
by a sole local agency, in accordance with the following requirements:
    (1) General. Except as provided in paragraphs (a)(2) and (3) of this 
section, the State plan must provide that the designated State agency is 
one of the following types of agencies:
    (i) A State agency that is primarily concerned with vocational 
rehabilitation or vocational and other rehabilitation of individuals 
with disabilities; or
    (ii) A State agency that includes a vocational rehabilitation unit 
as provided in paragraph (b) of this section.
    (2) American Samoa. In the case of American Samoa, the State plan 
must designate the Governor.
    (3) Designated State agency for individuals who are blind. If a 
State commission or other agency that provides assistance or services to 
individuals who are blind is authorized under State law to provide 
vocational rehabilitation services to individuals who are blind, and 
this commission or agency is primarily concerned with vocational 
rehabilitation or includes a vocational rehabilitation unit as provided 
in paragraph (b) of this section, the State plan may designate that 
agency as the sole State agency to administer the part of the plan under 
which vocational rehabilitation services are provided for individuals 
who are blind or to supervise its administration in a political 
subdivision of the State by a sole local agency.
    (b) Designation of State unit.
    (1) If the designated State agency is not of the type specified in 
paragraph (a)(1)(i) of this section or if the designated State agency 
specified in paragraph (a)(3) of this section is not primarily concerned 
with vocational rehabilitation or vocational and other rehabilitation of 
individuals with disabilities, the State plan must assure that the 
agency (or each agency if two agencies are designated) includes a 
vocational rehabilitation bureau, division, or unit that--
    (i) Is primarily concerned with vocational rehabilitation or 
vocational and other rehabilitation of individuals with disabilities and 
is responsible for the administration of the State agency's vocational 
rehabilitation program under the State plan;
    (ii) Has a full-time director;
    (iii) Has a staff, at least 90 percent of whom are employed full 
time on the rehabilitation work of the organizational unit; and
    (iv) Is located at an organizational level and has an organizational 
status within the State agency comparable to that of other major 
organizational units of the agency.
    (2) In the case of a State that has not designated a separate State 
agency for individuals who are blind, as provided for in paragraph 
(a)(3) of this section, the State may assign responsibility for the part 
of the plan under which vocational rehabilitation services are provided 
to individuals who are blind to one organizational unit of the 
designated State agency and may assign responsibility for the rest of 
the plan to another organizational unit of the

[[Page 259]]

designated State agency, with the provisions of paragraph (b)(1) of this 
section applying separately to each of these units.
    (c) Responsibility for administration.
    (1) At a minimum, the following activities are the responsibility of 
the designated State unit or the sole local agency under the supervision 
of the State unit:
    (i) All decisions affecting eligibility for vocational 
rehabilitation services, the nature and scope of available services, and 
the provision of these services.
    (ii) The determination to close the record of services of an 
individual who has achieved an employment outcome in accordance with 
Sec. 361.56.
    (iii) Policy formulation and implementation.
    (iv) The allocation and expenditure of vocational rehabilitation 
funds.
    (v) Participation as a partner in the One-Stop service delivery 
system under Title I of the Workforce Investment Act of 1998, in 
accordance with 20 CFR part 662.
    (2) The responsibility for the functions described in paragraph 
(c)(1) of this section may not be delegated to any other agency or 
individual.

(Approved by the Office of Management and Budget under control number 
1820-0500)

(Authority: Section 101(a)(2) of the Act; 29 U.S.C. 721(a)(2))

[66 FR 4382, Jan. 17, 2001, as amended at 66 FR 7253, Jan. 22, 2001]



Sec. 361.14  Substitute State agency.

    (a) General provisions.
    (1) If the Secretary has withheld all funding from a State under 
Sec. 361.11, the State may designate another agency to substitute for 
the designated State agency in carrying out the State's program of 
vocational rehabilitation services.
    (2) Any public or nonprofit private organization or agency within 
the State or any political subdivision of the State is eligible to be a 
substitute agency.
    (3) The substitute agency must submit a State plan that meets the 
requirements of this part.
    (4) The Secretary makes no grant to a substitute agency until the 
Secretary approves its plan.
    (b) Substitute agency matching share. The Secretary does not make 
any payment to a substitute agency unless it has provided assurances 
that it will contribute the same matching share as the State would have 
been required to contribute if the State agency were carrying out the 
vocational rehabilitation program.

(Approved by the Office of Management and Budget under control number 
1820-0500)

(Authority: Section 107(c)(3) of the Act; 29 U.S.C. 727(c)(3))

[66 FR 4382, Jan. 17, 2001, as amended at 66 FR 7253, Jan. 22, 2001]



Sec. 361.15  Local administration.

    (a) If the State plan provides for the administration of the plan by 
a local agency, the designated State agency must--
    (1) Ensure that each local agency is under the supervision of the 
designated State unit and is the sole local agency as defined in Sec. 
361.5(b)(47) that is responsible for the administration of the program 
within the political subdivision that it serves; and
    (2) Develop methods that each local agency will use to administer 
the vocational rehabilitation program, in accordance with the State 
plan.
    (b) A separate local agency serving individuals who are blind may 
administer that part of the plan relating to vocational rehabilitation 
of individuals who are blind, under the supervision of the designated 
State unit for individuals who are blind.

(Approved by the Office of Management and Budget under control number 
1820-0500)

(Authority: Sections 7(24) and 101(a)(2)(A) of the Act; 29 U.S.C. 
705(24) and 721(a)(2)(A))

[66 FR 4382, Jan. 17, 2001, as amended at 66 FR 7253, Jan. 22, 2001]



Sec. 361.16  Establishment of an independent commission or a state 
rehabilitation council.

    (a) General requirement. Except as provided in paragraph (b) of this 
section, the State plan must contain one of the following two 
assurances:

[[Page 260]]

    (1) An assurance that the designated State agency is an independent 
State commission that--
    (i) Is responsible under State law for operating, or overseeing the 
operation of, the vocational rehabilitation program in the State and is 
primarily concerned with vocational rehabilitation or vocational and 
other rehabilitation services, in accordance with Sec. 361.13(a)(1)(i);
    (ii) Is consumer-controlled by persons who--
    (A) Are individuals with physical or mental impairments that 
substantially limit major life activities; and
    (B) Represent individuals with a broad range of disabilities, unless 
the designated State unit under the direction of the commission is the 
State agency for individuals who are blind;
    (iii) Includes family members, advocates, or other representatives 
of individuals with mental impairments; and
    (iv) Conducts the functions identified in Sec. 361.17(h)(4).
    (2) An assurance that--
    (i) The State has established a State Rehabilitation Council 
(Council) that meets the requirements of Sec. 361.17;
    (ii) The designated State unit, in accordance with Sec. 361.29, 
jointly develops, agrees to, and reviews annually State goals and 
priorities and jointly submits to the Secretary annual reports of 
progress with the Council;
    (iii) The designated State unit regularly consults with the Council 
regarding the development, implementation, and revision of State 
policies and procedures of general applicability pertaining to the 
provision of vocational rehabilitation services;
    (iv) The designated State unit transmits to the Council--
    (A) All plans, reports, and other information required under this 
part to be submitted to the Secretary;
    (B) All policies and information on all practices and procedures of 
general applicability provided to or used by rehabilitation personnel 
providing vocational rehabilitation services under this part; and
    (C) Copies of due process hearing decisions issued under this part 
and transmitted in a manner to ensure that the identity of the 
participants in the hearings is kept confidential; and
    (v) The State plan, and any revision to the State plan, includes a 
summary of input provided by the Council, including recommendations from 
the annual report of the Council, the review and analysis of consumer 
satisfaction described in Sec. 361.17(h)(4), and other reports prepared 
by the Council, and the designated State unit's response to the input 
and recommendations, including explanations of reasons for rejecting any 
input or recommendation of the Council.
    (b) Exception for separate State agency for individuals who are 
blind. In the case of a State that designates a separate State agency 
under Sec. 361.13(a)(3) to administer the part of the State plan under 
which vocational rehabilitation services are provided to individuals who 
are blind, the State must either establish a separate State 
Rehabilitation Council for each agency that does not meet the 
requirements in paragraph (a)(1) of this section or establish one State 
Rehabilitation Council for both agencies if neither agency meets the 
requirements of paragraph (a)(1) of this section.

(Approved by the Office of Management and Budget under control number 
1820-0500)

(Authority: Sections 101(a)(21) of the Act; 29 U.S.C. 721(a)(21))

[66 FR 4382, Jan. 17, 2001, as amended at 66 FR 7253, Jan. 22, 2001]



Sec. 361.17  Requirements for a state rehabilitation council.

    If the State has established a Council under Sec. 361.16(a)(2) or 
(b), the Council must meet the following requirements:
    (a) Appointment. (1) The members of the Council must be appointed by 
the Governor or, in the case of a State that, under State law, vests 
authority for the administration of the activities carried out under 
this part in an entity other than the Governor (such as one or more 
houses of the State legislature or an independent board), the chief 
officer of that entity.
    (2) The appointing authority must select members of the Council 
after soliciting recommendations from representatives of organizations 
representing a broad range of individuals with disabilities and 
organizations interested in individuals with disabilities. In selecting

[[Page 261]]

members, the appointing authority must consider, to the greatest extent 
practicable, the extent to which minority populations are represented on 
the Council.
    (b) Composition--(1) General. Except as provided in paragraph (b)(3) 
of this section, the Council must be composed of at least 15 members, 
including--
    (i) At least one representative of the Statewide Independent Living 
Council, who must be the chairperson or other designee of the Statewide 
Independent Living Council;
    (ii) At least one representative of a parent training and 
information center established pursuant to section 682(a) of the 
Individuals with Disabilities Education Act;
    (iii) At least one representative of the Client Assistance Program 
established under 34 CFR part 370, who must be the director of or other 
individual recommended by the Client Assistance Program;
    (iv) At least one qualified vocational rehabilitation counselor with 
knowledge of and experience with vocational rehabilitation programs who 
serves as an ex officio, nonvoting member of the Council if employed by 
the designated State agency;
    (v) At least one representative of community rehabilitation program 
service providers;
    (vi) Four representatives of business, industry, and labor;
    (vii) Representatives of disability groups that include a cross 
section of--
    (A) Individuals with physical, cognitive, sensory, and mental 
disabilities; and
    (B) Representatives of individuals with disabilities who have 
difficulty representing themselves or are unable due to their 
disabilities to represent themselves;
    (viii) Current or former applicants for, or recipients of, 
vocational rehabilitation services;
    (ix) In a State in which one or more projects are carried out under 
section 121 of the Act (American Indian Vocational Rehabilitation 
Services), at least one representative of the directors of the projects;
    (x) At least one representative of the State educational agency 
responsible for the public education of students with disabilities who 
are eligible to receive services under this part and part B of the 
Individuals with Disabilities Education Act;
    (xi) At least one representative of the State workforce investment 
board; and
    (xii) The director of the designated State unit as an ex officio, 
nonvoting member of the Council.
    (2) Employees of the designated State agency. Employees of the 
designated State agency may serve only as nonvoting members of the 
Council. This provision does not apply to the representative appointed 
pursuant to paragraph (b)(1)(iii) of this section.
    (3) Composition of a separate Council for a separate State agency 
for individuals who are blind. Except as provided in paragraph (b)(4) of 
this section, if the State establishes a separate Council for a separate 
State agency for individuals who are blind, that Council must--
    (i) Conform with all of the composition requirements for a Council 
under paragraph (b)(1) of this section, except the requirements in 
paragraph (b)(1)(vii), unless the exception in paragraph (b)(4) of this 
section applies; and
    (ii) Include--
    (A) At least one representative of a disability advocacy group 
representing individuals who are blind; and
    (B) At least one representative of an individual who is blind, has 
multiple disabilities, and has difficulty representing himself or 
herself or is unable due to disabilities to represent himself or 
herself.
    (4) Exception. If State law in effect on October 29, 1992 requires a 
separate Council under paragraph (b)(3) of this section to have fewer 
than 15 members, the separate Council is in compliance with the 
composition requirements in paragraphs (b)(1)(vi) and (b)(1)(viii) of 
this section if it includes at least one representative who meets the 
requirements for each of those paragraphs.
    (c) Majority. (1) A majority of the Council members must be 
individuals with disabilities who meet the requirements of Sec. 
361.5(b)(29) and are not employed by the designated State unit.
    (2) In the case of a separate Council established under Sec. 
361.16(b), a majority

[[Page 262]]

of the Council members must be individuals who are blind and are not 
employed by the designated State unit.
    (d) Chairperson. The chairperson must be--
    (1) Selected by the members of the Council from among the voting 
members of the Council, subject to the veto power of the Governor; or
    (2) In States in which the Governor does not have veto power 
pursuant to State law, the appointing authority described in paragraph 
(a)(1) of this section must designate a member of the Council to serve 
as the chairperson of the Council or must require the Council to 
designate a member to serve as chairperson.
    (e) Terms of appointment. (1) Each member of the Council must be 
appointed for a term of no more than 3 years, and each member of the 
Council, other than a representative identified in paragraph (b)(1)(iii) 
or (ix) of this section, may serve for no more than two consecutive full 
terms.
    (2) A member appointed to fill a vacancy occurring prior to the end 
of the term for which the predecessor was appointed must be appointed 
for the remainder of the predecessor's term.
    (3) The terms of service of the members initially appointed must be, 
as specified by the appointing authority as described in paragraph 
(a)(1) of this section, for varied numbers of years to ensure that terms 
expire on a staggered basis.
    (f) Vacancies. (1) A vacancy in the membership of the Council must 
be filled in the same manner as the original appointment, except the 
appointing authority as described in paragraph (a)(1) of this section 
may delegate the authority to fill that vacancy to the remaining members 
of the Council after making the original appointment.
    (2) No vacancy affects the power of the remaining members to execute 
the duties of the Council.
    (g) Conflict of interest. No member of the Council shall cast a vote 
on any matter that would provide direct financial benefit to the member 
or the member's organization or otherwise give the appearance of a 
conflict of interest under State law.
    (h) Functions. The Council must, after consulting with the State 
workforce investment board--
    (1) Review, analyze, and advise the designated State unit regarding 
the performance of the State unit's responsibilities under this part, 
particularly responsibilities related to--
    (i) Eligibility, including order of selection;
    (ii) The extent, scope, and effectiveness of services provided; and
    (iii) Functions performed by State agencies that affect or 
potentially affect the ability of individuals with disabilities in 
achieving employment outcomes under this part;
    (2) In partnership with the designated State unit--
    (i) Develop, agree to, and review State goals and priorities in 
accordance with Sec. 361.29(c); and
    (ii) Evaluate the effectiveness of the vocational rehabilitation 
program and submit reports of progress to the Secretary in accordance 
with Sec. 361.29(e);
    (3) Advise the designated State agency and the designated State unit 
regarding activities carried out under this part and assist in the 
preparation of the State plan and amendments to the plan, applications, 
reports, needs assessments, and evaluations required by this part;
    (4) To the extent feasible, conduct a review and analysis of the 
effectiveness of, and consumer satisfaction with--
    (i) The functions performed by the designated State agency;
    (ii) The vocational rehabilitation services provided by State 
agencies and other public and private entities responsible for providing 
vocational rehabilitation services to individuals with disabilities 
under the Act; and
    (iii) The employment outcomes achieved by eligible individuals 
receiving services under this part, including the availability of health 
and other employment benefits in connection with those employment 
outcomes;
    (5) Prepare and submit to the Governor and to the Secretary no later 
than 90 days after the end of the Federal fiscal year an annual report 
on the status of vocational rehabilitation programs operated within the 
State and make the report available to the public

[[Page 263]]

through appropriate modes of communication;
    (6) To avoid duplication of efforts and enhance the number of 
individuals served, coordinate activities with the activities of other 
councils within the State, including the Statewide Independent Living 
Council established under 34 CFR part 364, the advisory panel 
established under section 612(a)(21) of the Individuals with 
Disabilities Education Act, the State Developmental Disabilities 
Planning Council described in section 124 of the Developmental 
Disabilities Assistance and Bill of Rights Act, the State mental health 
planning council established under section 1914(a) of the Public Health 
Service Act, and the State workforce investment board;
    (7) Provide for coordination and the establishment of working 
relationships between the designated State agency and the Statewide 
Independent Living Council and centers for independent living within the 
State; and
    (8) Perform other comparable functions, consistent with the purpose 
of this part, as the Council determines to be appropriate, that are 
comparable to the other functions performed by the Council.
    (i) Resources. (1) The Council, in conjunction with the designated 
State unit, must prepare a plan for the provision of resources, 
including staff and other personnel, that may be necessary and 
sufficient for the Council to carry out its functions under this part.
    (2) The resource plan must, to the maximum extent possible, rely on 
the use of resources in existence during the period of implementation of 
the plan.
    (3) Any disagreements between the designated State unit and the 
Council regarding the amount of resources necessary to carry out the 
functions of the Council must be resolved by the Governor, consistent 
with paragraphs (i)(1) and (2) of this section.
    (4) The Council must, consistent with State law, supervise and 
evaluate the staff and personnel that are necessary to carry out its 
functions.
    (5) Those staff and personnel that are assisting the Council in 
carrying out its functions may not be assigned duties by the designated 
State unit or any other agency or office of the State that would create 
a conflict of interest.
    (j) Meetings. The Council must--
    (1) Convene at least four meetings a year in locations determined by 
the Council to be necessary to conduct Council business. The meetings 
must be publicly announced, open, and accessible to the general public, 
including individuals with disabilities, unless there is a valid reason 
for an executive session; and
    (2) Conduct forums or hearings, as appropriate, that are publicly 
announced, open, and accessible to the public, including individuals 
with disabilities.
    (k) Compensation. Funds appropriated under Title I of the Act, 
except funds to carry out sections 112 and 121 of the Act, may be used 
to compensate and reimburse the expenses of Council members in 
accordance with section 105(g) of the Act.

(Approved by the Office of Management and Budget under control number 
1820-0500)

(Authority: Section 105 of the Act; 29 U.S.C. 725)

[66 FR 4382, Jan. 17, 2001, as amended at 66 FR 7253, Jan. 22, 2001]



Sec. 361.18  Comprehensive system of personnel development.

    The State plan must describe the procedures and activities the State 
agency will undertake to establish and maintain a comprehensive system 
of personnel development designed to ensure an adequate supply of 
qualified rehabilitation personnel, including professionals and 
paraprofessionals, for the designated State unit. If the State agency 
has a State Rehabilitation Council, this description must, at a minimum, 
specify that the Council has an opportunity to review and comment on the 
development of plans, policies, and procedures necessary to meet the 
requirements of paragraphs (b) through (d) of this section. This 
description must also conform with the following requirements:
    (a) Data system on personnel and personnel development. The State 
plan must describe the development and maintenance of a system by the 
State agency for collecting and analyzing on

[[Page 264]]

an annual basis data on qualified personnel needs and personnel 
development, in accordance with the following requirements:
    (1) Data on qualified personnel needs must include--
    (i) The number of personnel who are employed by the State agency in 
the provision of vocational rehabilitation services in relation to the 
number of individuals served, broken down by personnel category;
    (ii) The number of personnel currently needed by the State agency to 
provide vocational rehabilitation services, broken down by personnel 
category; and
    (iii) Projections of the number of personnel, broken down by 
personnel category, who will be needed by the State agency to provide 
vocational rehabilitation services in the State in 5 years based on 
projections of the number of individuals to be served, including 
individuals with significant disabilities, the number of personnel 
expected to retire or leave the field, and other relevant factors.
    (2) Data on personnel development must include--
    (i) A list of the institutions of higher education in the State that 
are preparing vocational rehabilitation professionals, by type of 
program;
    (ii) The number of students enrolled at each of those institutions, 
broken down by type of program; and
    (iii) The number of students who graduated during the prior year 
from each of those institutions with certification or licensure, or with 
the credentials for certification or licensure, broken down by the 
personnel category for which they have received, or have the credentials 
to receive, certification or licensure.
    (b) Plan for recruitment, preparation, and retention of qualified 
personnel. The State plan must describe the development, updating, and 
implementation of a plan to address the current and projected needs for 
personnel who are qualified in accordance with paragraph (c) of this 
section. The plan must identify the personnel needs based on the data 
collection and analysis system described in paragraph (a) of this 
section and must provide for the coordination and facilitation of 
efforts between the designated State unit and institutions of higher 
education and professional associations to recruit, prepare, and retain 
personnel who are qualified in accordance with paragraph (c) of this 
section, including personnel from minority backgrounds and personnel who 
are individuals with disabilities.
    (c) Personnel standards. (1) The State plan must include the State 
agency's policies and describe the procedures the State agency will 
undertake to establish and maintain standards to ensure that all 
professional and paraprofessional personnel needed within the designated 
State unit to carry out this part are appropriately and adequately 
prepared and trained, including--
    (i) Standards that are consistent with any national or State-
approved or -recognized certification, licensing, or registration 
requirements, or, in the absence of these requirements, other comparable 
requirements (including State personnel requirements) that apply to the 
profession or discipline in which that category of personnel is 
providing vocational rehabilitation services; and
    (ii) To the extent that existing standards are not based on the 
highest requirements in the State, the steps the State is currently 
taking and the steps the State plans to take to retrain or hire 
personnel to meet standards that are based on the highest requirements 
in the State, including measures to notify State unit personnel, the 
institutions of higher education identified under paragraph (a)(2)(i) of 
this section, and other public agencies of these steps and the timelines 
for taking each step. The steps taken by the State unit under this 
paragraph must be described in a written plan that includes--
    (A) Specific strategies for retraining, recruiting, and hiring 
personnel;
    (B) The specific time period by which all State unit personnel will 
meet the standards described in paragraph (c)(1)(i) of this section;
    (C) Procedures for evaluating the State unit's progress in hiring or 
retraining personnel to meet applicable personnel standards within the 
time period established under paragraph (c)(1)(ii)(B) of this section; 
and

[[Page 265]]

    (D) In instances in which the State unit is unable to immediately 
hire new personnel who meet the requirements in paragraph (c)(1)(i) of 
this section, the initial minimum qualifications that the designated 
State unit will require of newly hired personnel and a plan for training 
those individuals to meet applicable requirements within the time period 
established under paragraph (c)(1)(ii)(B) of this section.
    (2) As used in this section--
    (i) Highest requirements in the State applicable to that profession 
or discipline means the highest entry-level academic degree needed for 
any national or State-approved or -recognized certification, licensing, 
registration, or, in the absence of these requirements, other comparable 
requirements that apply to that profession or discipline. The current 
requirements of all State statutes and regulations of other agencies in 
the State applicable to that profession or discipline must be considered 
and must be kept on file by the designated State unit and available to 
the public.
    (ii) Profession or discipline means a specific occupational 
category, including any paraprofessional occupational category, that--
    (A) Provides rehabilitation services to individuals with 
disabilities;
    (B) Has been established or designated by the State unit; and
    (C) Has a specified scope of responsibility.
    (d) Staff development. (1) The State plan must include the State 
agency's policies and describe the procedures and activities the State 
agency will undertake to ensure that all personnel employed by the State 
unit receive appropriate and adequate training, including a description 
of--
    (i) A system of staff development for rehabilitation professionals 
and paraprofessionals within the State unit, particularly with respect 
to assessment, vocational counseling, job placement, and rehabilitation 
technology; and
    (ii) Procedures for acquiring and disseminating to rehabilitation 
professionals and paraprofessionals within the designated State unit 
significant knowledge from research and other sources.
    (2) The specific training areas for staff development must be based 
on the needs of each State unit and may include, but are not limited 
to--
    (i) Training regarding the Workforce Investment Act of 1998 and the 
amendments to the Rehabilitation Act of 1973 made by the Rehabilitation 
Act Amendments of 1998;
    (ii) Training with respect to the requirements of the Americans with 
Disabilities Act, the Individuals with Disabilities Education Act, and 
Social Security work incentive programs, including programs under the 
Ticket to Work and Work Incentives Improvement Act of 1999, training to 
facilitate informed choice under this program, and training to improve 
the provision of services to culturally diverse populations; and
    (iii) Activities related to--
    (A) Recruitment and retention of qualified rehabilitation personnel;
    (B) Succession planning; and
    (C) Leadership development and capacity building.
    (e) Personnel to address individual communication needs. The State 
plan must describe how the State unit--
    (1) Includes among its personnel, or obtains the services of, 
individuals able to communicate in the native languages of applicants 
and eligible individuals who have limited English speaking ability; and
    (2) Includes among its personnel, or obtains the services of, 
individuals able to communicate with applicants and eligible individuals 
in appropriate modes of communication.
    (f) Coordination with personnel development under the Individuals 
with Disabilities Education Act. The State plan must describe the 
procedures and activities the State agency will undertake to coordinate 
its comprehensive system of personnel development under the Act with 
personnel development under the Individuals with Disabilities Education 
Act.

(Approved by the Office of Management and Budget under control number 
1820-0500)

(Authority: Section 101(a)(7) of the Act; 29 U.S.C. 721(a)(7))

[66 FR 4382, Jan. 17, 2001, as amended at 66 FR 7253, Jan. 22, 2001]

[[Page 266]]



Sec. 361.19  Affirmative action for individuals with disabilities.

    The State plan must assure that the State agency takes affirmative 
action to employ and advance in employment qualified individuals with 
disabilities covered under and on the same terms and conditions as 
stated in section 503 of the Act.

(Approved by the Office of Management and Budget under control number 
1820-0500)

(Authority: Section 101(a)(6)(B) of the Act; 29 U.S.C. 721(a)(6)(B))

[66 FR 4382, Jan. 17, 2001, as amended at 66 FR 7253, Jan. 22, 2001]



Sec. 361.20  Public participation requirements.

    (a) Conduct of public meetings. The State plan must assure that 
prior to the adoption of any substantive policies or procedures 
governing the provision of vocational rehabilitation services under the 
State plan, including making any substantive amendments to the policies 
and procedures, the designated State agency conducts public meetings 
throughout the State to provide the public, including individuals with 
disabilities, an opportunity to comment on the policies or procedures.
    (b) Notice requirements. The State plan must assure that the 
designated State agency, prior to conducting the public meetings, 
provides appropriate and sufficient notice throughout the State of the 
meetings in accordance with--
    (1) State law governing public meetings; or
    (2) In the absence of State law governing public meetings, 
procedures developed by the designated State agency in consultation with 
the State Rehabilitation Council.
    (c) Summary of input of the State Rehabilitation Council. The State 
plan must provide a summary of the input of the State Rehabilitation 
Council, if the State agency has a Council, into the State plan and any 
amendment to the plan, in accordance with Sec. 361.16(a)(2)(v).
    (d) Special consultation requirements. The State plan must assure 
that the State agency actively consults with the director of the Client 
Assistance Program, the State Rehabilitation Council, if the State 
agency has a Council, and, as appropriate, Indian tribes, tribal 
organizations, and native Hawaiian organizations on its policies and 
procedures governing the provision of vocational rehabilitation services 
under the State plan.
    (e) Appropriate modes of communication. The State unit must provide 
to the public, through appropriate modes of communication, notices of 
the public meetings, any materials furnished prior to or during the 
public meetings, and the policies and procedures governing the provision 
of vocational rehabilitation services under the State plan.

(Approved by the Office of Management and Budget under control number 
1820-0500)

(Authority: Sections 101(a)(16)(A) and 105(c)(3) of the Act; 29 U.S.C. 
721(a)(16)(A), and 725(c)(3))

[66 FR 4382, Jan. 17, 2001, as amended at 66 FR 7253, Jan. 22, 2001]



Sec. 361.21  Consultations regarding the administration of the state plan.

    The State plan must assure that, in connection with matters of 
general policy arising in the administration of the State plan, the 
designated State agency takes into account the views of--
    (a) Individuals and groups of individuals who are recipients of 
vocational rehabilitation services or, as appropriate, the individuals' 
representatives;
    (b) Personnel working in programs that provide vocational 
rehabilitation services to individuals with disabilities;
    (c) Providers of vocational rehabilitation services to individuals 
with disabilities;
    (d) The director of the Client Assistance Program; and
    (e) The State Rehabilitation Council, if the State has a Council.

(Approved by the Office of Management and Budget under control number 
1820-0500)

(Authority: Sections 101(a)(16)(B) of the Act; 29 U.S.C. 721(a)(16)(B))

[66 FR 4382, Jan. 17, 2001, as amended at 66 FR 7253, Jan. 22, 2001]



Sec. 361.22  Coordination with education officials.

    (a) Plans, policies, and procedures. (1) The State plan must contain 
plans,

[[Page 267]]

policies, and procedures for coordination between the designated State 
agency and education officials responsible for the public education of 
students with disabilities that are designed to facilitate the 
transition of students with disabilities from the receipt of educational 
services in school to the receipt of vocational rehabilitation services 
under the responsibility of the designated State agency.
    (2) These plans, policies, and procedures in paragraph (a)(1) of 
this section must provide for the development and approval of an 
individualized plan for employment in accordance with Sec. 361.45 as 
early as possible during the transition planning process but, at the 
latest, by the time each student determined to be eligible for 
vocational rehabilitation services leaves the school setting or, if the 
designated State unit is operating under an order of selection, before 
each eligible student able to be served under the order leaves the 
school setting.
    (b) Formal interagency agreement. The State plan must include 
information on a formal interagency agreement with the State educational 
agency that, at a minimum, provides for--
    (1) Consultation and technical assistance to assist educational 
agencies in planning for the transition of students with disabilities 
from school to post-school activities, including vocational 
rehabilitation services;
    (2) Transition planning by personnel of the designated State agency 
and educational agency personnel for students with disabilities that 
facilitates the development and completion of their individualized 
education programs (IEPs) under section 614(d) of the Individuals with 
Disabilities Education Act;
    (3) The roles and responsibilities, including financial 
responsibilities, of each agency, including provisions for determining 
State lead agencies and qualified personnel responsible for transition 
services; and
    (4) Procedures for outreach to and identification of students with 
disabilities who are in need of transition services. Outreach to these 
students should occur as early as possible during the transition 
planning process and must include, at a minimum, a description of the 
purpose of the vocational rehabilitation program, eligibility 
requirements, application procedures, and scope of services that may be 
provided to eligible individuals.

(Approved by the Office of Management and Budget under control number 
1820-0500)

(Authority: Section 101(a)(11)(D) of the Act; 29 U.S.C. 721 (a)(11)(D))

[66 FR 4382, Jan. 17, 2001, as amended at 66 FR 7253, Jan. 22, 2001]



Sec. 361.23  Requirements related to the statewide workforce investment 
system.

    (a) Responsibilities as a partner of the One-Stop service delivery 
system. As a required partner in the One-Stop service delivery system 
(which is part of the statewide workforce investment system under Title 
I of the Workforce Investment Act of 1998), the designated State unit 
must carry out the following functions consistent with the Act, this 
part, Title I of the Workforce Investment Act of 1998, and the 
regulations in 20 CFR part 662:
    (1) Make available to participants through the One-Stop service 
delivery system the core services (as described in 20 CFR 662.240) that 
are applicable to the Program administered by the designated State unit 
under this part.
    (2) Use a portion of funds made available to the Program 
administered by the designated State unit under this part, consistent 
with the Act and this part, to--
    (i) Create and maintain the One-Stop service delivery system; and
    (ii) Provide core services (as described in 20 CFR 662.240).
    (3) Enter into a memorandum of understanding (MOU) with the Local 
Workforce Investment Board under section 117 of the Workforce Investment 
Act of 1998 relating to the operation of the One-Stop service delivery 
system that meets the requirements of section 121(c) of the Workforce 
Investment Act and 20 CFR 662.300, including a description of services, 
how the cost of the identified services and operating costs of the 
system will be funded, and methods for referrals.
    (4) Participate in the operation of the One-Stop service delivery 
system consistent with the terms of the MOU and

[[Page 268]]

the requirements of the Act and this part.
    (5) Provide representation on the Local Workforce Investment Board 
under section 117 of the Workforce Investment Act of 1998.
    (b) Cooperative agreements with One-Stop partners. (1) The State 
plan must assure that the designated State unit or the designated State 
agency enters into cooperative agreements with the other entities that 
are partners under the One-Stop service delivery system under Title I of 
the Workforce Investment Act of 1998 and replicates those agreements at 
the local level between individual offices of the designated State unit 
and local entities carrying out the One-Stop service delivery system or 
other activities through the statewide workforce investment system.
    (2) Cooperative agreements developed under paragraph (b)(1) of this 
section may provide for--
    (i) Intercomponent training and technical assistance regarding--
    (A) The availability and benefits of, and information on eligibility 
standards for, vocational rehabilitation services; and
    (B) The promotion of equal, effective and meaningful participation 
by individuals with disabilities in the One-Stop service delivery system 
and other workforce investment activities through the promotion of 
program accessibility consistent with the requirements of the Americans 
with Disabilities Act of 1990 and section 504 of the Act, the use of 
nondiscriminatory policies and procedures, and the provision of 
reasonable accommodations, auxiliary aids and services, and 
rehabilitation technology for individuals with disabilities;
    (ii) The use of information and financial management systems that 
link all of the partners of the One-Stop service delivery system to one 
another and to other electronic networks, including nonvisual electronic 
networks, and that relate to subjects such as employment statistics, job 
vacancies, career planning, and workforce investment activities;
    (iii) The use of customer service features such as common intake and 
referral procedures, customer databases, resource information, and human 
services hotlines;
    (iv) The establishment of cooperative efforts with employers to 
facilitate job placement and carry out other activities that the 
designated State unit and the employers determine to be appropriate;
    (v) The identification of staff roles, responsibilities, and 
available resources and specification of the financial responsibility of 
each partner of the One-Stop service delivery system with respect to 
providing and paying for necessary services, consistent with the 
requirements of the Act, this part, other Federal requirements, and 
State law; and
    (vi) The specification of procedures for resolving disputes among 
partners of the One-Stop service delivery system.

(Approved by the Office of Management and Budget under control number 
1820-0500)

(Authority: Section 101(a)(11)(A) of the Act; 29 U.S.C. 721(a)(11)(A); 
Sections 121 and 134 of the Workforce Investment Act of 1998; 29 U.S.C. 
2841 and 2864)

[66 FR 4382, Jan. 17, 2001, as amended at 66 FR 7253, Jan. 22, 2001]



Sec. 361.24  Cooperation and coordination with other entities.

    (a) Interagency cooperation. The State plan must describe the 
designated State agency's cooperation with and use of the services and 
facilities of Federal, State, and local agencies and programs, including 
programs carried out by the Under Secretary for Rural Development of the 
Department of Agriculture and State use contracting programs, to the 
extent that those agencies and programs are not carrying out activities 
through the statewide workforce investment system.
    (b) Coordination with the Statewide Independent Living Council and 
independent living centers. The State plan must assure that the 
designated State unit, the Statewide Independent Living Council 
established under 34 CFR part 364, and the independent living centers 
established under 34 CFR part 366 have developed working relationships 
and coordinate their activities.
    (c) Cooperative agreement with recipients of grants for services to 
American Indians.

[[Page 269]]

    (1) General. In applicable cases, the State plan must assure that 
the designated State agency has entered into a formal cooperative 
agreement with each grant recipient in the State that receives funds 
under part C of the Act (American Indian Vocational Rehabilitation 
Services).
    (2) Contents of formal cooperative agreement. The agreement required 
under paragraph (a)(1) of this section must describe strategies for 
collaboration and coordination in providing vocational rehabilitation 
services to American Indians who are individuals with disabilities, 
including--
    (i) Strategies for interagency referral and information sharing that 
will assist in eligibility determinations and the development of 
individualized plans for employment;
    (ii) Procedures for ensuring that American Indians who are 
individuals with disabilities and are living near a reservation or 
tribal service area are provided vocational rehabilitation services; and
    (iii) Provisions for sharing resources in cooperative studies and 
assessments, joint training activities, and other collaborative 
activities designed to improve the provision of services to American 
Indians who are individuals with disabilities.
    (d) Reciprocal referral services between two designated State units 
in the same State. If there is a separate designated State unit for 
individuals who are blind, the two designated State units must establish 
reciprocal referral services, use each other's services and facilities 
to the extent feasible, jointly plan activities to improve services in 
the State for individuals with multiple impairments, including visual 
impairments, and otherwise cooperate to provide more effective services, 
including, if appropriate, entering into a written cooperative 
agreement.

(Approved by the Office of Management and Budget under control number 
1820-0500)

(Authority: Sections 12(c) and 101(a)(11)(C), (E), and (F) of the Act; 
29 U.S.C. 709(c) and 721(a)(11) (C), (E), and (F))

[66 FR 4382, Jan. 17, 2001, as amended at 66 FR 7253, Jan. 22, 2001]



Sec. 361.25  Statewideness.

    The State plan must assure that services provided under the State 
plan will be available in all political subdivisions of the State, 
unless a waiver of statewideness is requested and approved in accordance 
with Sec. 361.26.

(Approved by the Office of Management and Budget under control number 
1820-0500)

(Authority: Section 101(a)(4) of the Act; 29 U.S.C. 721(a)(4))

[66 FR 4382, Jan. 17, 2001, as amended at 66 FR 7253, Jan. 22, 2001]



Sec. 361.26  Waiver of statewideness.

    (a) Availability. The State unit may provide services in one or more 
political subdivisions of the State that increase services or expand the 
scope of services that are available statewide under the State plan if--
    (1) The non-Federal share of the cost of these services is met from 
funds provided by a local public agency, including funds contributed to 
a local public agency by a private agency, organization, or individual;
    (2) The services are likely to promote the vocational rehabilitation 
of substantially larger numbers of individuals with disabilities or of 
individuals with disabilities with particular types of impairments; and
    (3) For purposes other than those specified in Sec. 361.60(b)(3)(i) 
and consistent with the requirements in Sec. 361.60(b)(3)(ii), the 
State includes in its State plan, and the Secretary approves, a waiver 
of the statewideness requirement, in accordance with the requirements of 
paragraph (b) of this section.
    (b) Request for waiver. The request for a waiver of statewideness 
must--
    (1) Identify the types of services to be provided;
    (2) Contain a written assurance from the local public agency that it 
will make available to the State unit the non-Federal share of funds;
    (3) Contain a written assurance that State unit approval will be 
obtained for each proposed service before it is put into effect; and

[[Page 270]]

    (4) Contain a written assurance that all other State plan 
requirements, including a State's order of selection requirements, will 
apply to all services approved under the waiver.

(Approved by the Office of Management and Budget under control number 
1820-0500)

(Authority: Section 101(a)(4) of the Act; 29 U.S.C. 721(a)(4))

[66 FR 4382, Jan. 17, 2001, as amended at 66 FR 7253, Jan. 22, 2001]



Sec. 361.27  Shared funding and administration of joint programs.

    (a) If the State plan provides for the designated State agency to 
share funding and administrative responsibility with another State 
agency or local public agency to carry out a joint program to provide 
services to individuals with disabilities, the State must submit to the 
Secretary for approval a plan that describes its shared funding and 
administrative arrangement.
    (b) The plan under paragraph (a) of this section must include--
    (1) A description of the nature and scope of the joint program;
    (2) The services to be provided under the joint program;
    (3) The respective roles of each participating agency in the 
administration and provision of services; and
    (4) The share of the costs to be assumed by each agency.
    (c) If a proposed joint program does not comply with the 
statewideness requirement in Sec. 361.25, the State unit must obtain a 
waiver of statewideness, in accordance with Sec. 361.26.

(Approved by the Office of Management and Budget under control number 
1820-0500)

(Authority: Section 101(a)(2)(A) of the Act; 29 U.S.C. 721(a)(2)(A))

[66 FR 4382, Jan. 17, 2001, as amended at 66 FR 7253, Jan. 22, 2001]



Sec. 361.28  Third-party cooperative arrangements involving funds 
from other public agencies.

    (a) The designated State unit may enter into a third-party 
cooperative arrangement for providing or administering vocational 
rehabilitation services with another State agency or a local public 
agency that is furnishing part or all of the non-Federal share, if the 
designated State unit ensures that--
    (1) The services provided by the cooperating agency are not the 
customary or typical services provided by that agency but are new 
services that have a vocational rehabilitation focus or existing 
services that have been modified, adapted, expanded, or reconfigured to 
have a vocational rehabilitation focus;
    (2) The services provided by the cooperating agency are only 
available to applicants for, or recipients of, services from the 
designated State unit;
    (3) Program expenditures and staff providing services under the 
cooperative arrangement are under the administrative supervision of the 
designated State unit; and
    (4) All State plan requirements, including a State's order of 
selection, will apply to all services provided under the cooperative 
program.
    (b) If a third party cooperative agreement does not comply with the 
statewideness requirement in Sec. 361.25, the State unit must obtain a 
waiver of statewideness, in accordance with Sec. 361.26.

(Approved by the Office of Management and Budget under control number 
1820-0500)

(Authority: Section 12(c) of the Act; 29 U.S.C. 709(c))

[66 FR 4382, Jan. 17, 2001, as amended at 66 FR 7253, Jan. 22, 2001]



Sec. 361.29  Statewide assessment; annual estimates; annual State 
goals and priorities; strategies; and progress reports.

    (a) Comprehensive statewide assessment. (1) The State plan must 
include--
    (i) The results of a comprehensive, statewide assessment, jointly 
conducted by the designated State unit and the State Rehabilitation 
Council (if the State unit has a Council) every 3 years describing the 
rehabilitation needs of individuals with disabilities residing within 
the State, particularly the vocational rehabilitation services needs 
of--
    (A) Individuals with the most significant disabilities, including 
their need for supported employment services;

[[Page 271]]

    (B) Individuals with disabilities who are minorities and individuals 
with disabilities who have been unserved or underserved by the 
vocational rehabilitation program carried out under this part; and
    (C) Individuals with disabilities served through other components of 
the statewide workforce investment system as identified by those 
individuals and personnel assisting those individuals through the 
components of the system; and
    (ii) An assessment of the need to establish, develop, or improve 
community rehabilitation programs within the State.
    (2) The State plan must assure that the State will submit to the 
Secretary a report containing information regarding updates to the 
assessments under paragraph (a) of this section for any year in which 
the State updates the assessments.
    (b) Annual estimates. The State plan must include, and must assure 
that the State will annually submit a report to the Secretary that 
includes, State estimates of--
    (1) The number of individuals in the State who are eligible for 
services under this part;
    (2) The number of eligible individuals who will receive services 
provided with funds provided under part B of Title I of the Act and 
under part B of Title VI of the Act, including, if the designated State 
agency uses an order of selection in accordance with Sec. 361.36, 
estimates of the number of individuals to be served under each priority 
category within the order; and
    (3) The costs of the services described in paragraph (b)(1) of this 
section, including, if the designated State agency uses an order of 
selection, the service costs for each priority category within the 
order.
    (c) Goals and priorities--(1) In general. The State plan must 
identify the goals and priorities of the State in carrying out the 
program.
    (2) Council. The goals and priorities must be jointly developed, 
agreed to, reviewed annually, and, as necessary, revised by the 
designated State unit and the State Rehabilitation Council, if the State 
unit has a Council.
    (3) Submission. The State plan must assure that the State will 
submit to the Secretary a report containing information regarding 
revisions in the goals and priorities for any year in which the State 
revises the goals and priorities.
    (4) Basis for goals and priorities. The State goals and priorities 
must be based on an analysis of--
    (i) The comprehensive statewide assessment described in paragraph 
(a) of this section, including any updates to the assessment;
    (ii) The performance of the State on the standards and indicators 
established under section 106 of the Act; and
    (iii) Other available information on the operation and the 
effectiveness of the vocational rehabilitation program carried out in 
the State, including any reports received from the State Rehabilitation 
Council under Sec. 361.17(h) and the findings and recommendations from 
monitoring activities conducted under section 107 of the Act.
    (5) Service and outcome goals for categories in order of selection. 
If the designated State agency uses an order of selection in accordance 
with Sec. 361.36, the State plan must identify the State's service and 
outcome goals and the time within which these goals may be achieved for 
individuals in each priority category within the order.
    (d) Strategies. The State plan must describe the strategies the 
State will use to address the needs identified in the assessment 
conducted under paragraph (a) of this section and achieve the goals and 
priorities identified in paragraph (c) of this section, including--
    (1) The methods to be used to expand and improve services to 
individuals with disabilities, including how a broad range of assistive 
technology services and assistive technology devices will be provided to 
those individuals at each stage of the rehabilitation process and how 
those services and devices will be provided to individuals with 
disabilities on a statewide basis;
    (2) Outreach procedures to identify and serve individuals with 
disabilities who are minorities and individuals with disabilities who 
have been unserved or underserved by the vocational rehabilitation 
program;

[[Page 272]]

    (3) As applicable, the plan of the State for establishing, 
developing, or improving community rehabilitation programs;
    (4) Strategies to improve the performance of the State with respect 
to the evaluation standards and performance indicators established 
pursuant to section 106 of the Act; and
    (5) Strategies for assisting other components of the statewide 
workforce investment system in assisting individuals with disabilities.
    (e) Evaluation and reports of progress. (1) The State plan must 
include--
    (i) The results of an evaluation of the effectiveness of the 
vocational rehabilitation program; and
    (ii) A joint report by the designated State unit and the State 
Rehabilitation Council, if the State unit has a Council, to the 
Secretary on the progress made in improving the effectiveness of the 
program from the previous year. This evaluation and joint report must 
include--
    (A) An evaluation of the extent to which the goals and priorities 
identified in paragraph (c) of this section were achieved;
    (B) A description of the strategies that contributed to the 
achievement of the goals and priorities;
    (C) To the extent to which the goals and priorities were not 
achieved, a description of the factors that impeded that achievement; 
and
    (D) An assessment of the performance of the State on the standards 
and indicators established pursuant to section 106 of the Act.
    (2) The State plan must assure that the designated State unit and 
the State Rehabilitation Council, if the State unit has a Council, will 
jointly submit to the Secretary an annual report that contains the 
information described in paragraph (e)(1) of this section.

(Approved by the Office of Management and Budget under control number 
1820-0500)

(Authority: Section 101(a)(15) of the Act; 29 U.S.C. 721(a)(15))

[66 FR 4382, Jan. 17, 2001, as amended at 66 FR 7253, Jan. 22, 2001]



Sec. 361.30  Services to American Indians.

    The State plan must assure that the designated State agency provides 
vocational rehabilitation services to American Indians who are 
individuals with disabilities residing in the State to the same extent 
as the designated State agency provides vocational rehabilitation 
services to other significant populations of individuals with 
disabilities residing in the State.

(Approved by the Office of Management and Budget under control number 
1820-0500)

(Authority: Sections 101(a)(13) and 121(b)(3) of the Act; 29 U.S.C. 
721(a)(13) and 741(b)(3))

[66 FR 4382, Jan. 17, 2001, as amended at 66 FR 7253, Jan. 22, 2001]



Sec. 361.31  Cooperative agreements with private nonprofit organizations.

    The State plan must describe the manner in which cooperative 
agreements with private nonprofit vocational rehabilitation service 
providers will be established.

(Approved by the Office of Management and Budget under control number 
1820-0500)

(Authority: Sections 101(a)(24)(B); 29 U.S.C. 721(a)(24)(B))

[66 FR 4382, Jan. 17, 2001, as amended at 66 FR 7253, Jan. 22, 2001]



Sec. 361.32  Use of profitmaking organizations for on-the-job training 
in connection with selected projects.

    The State plan must assure that the designated State agency has the 
authority to enter into contracts with for-profit organizations for the 
purpose of providing, as vocational rehabilitation services, on-the-job 
training and related programs for individuals with disabilities under 
the Projects With Industry program, 34 CFR part 379, if the designated 
State agency has determined that for-profit agencies are better 
qualified to provide needed vocational rehabilitation services than 
nonprofit agencies and organizations.

(Approved by the Office of Management and Budget under control number 
1820-0500)

(Authority: Section 101(a)(24)(A) of the Act; 29 U.S.C. 721(a)(24)(A))

[66 FR 4382, Jan. 17, 2001, as amended at 66 FR 7253, Jan. 22, 2001]

[[Page 273]]



Sec. 361.33  [Reserved]



Sec. 361.34  Supported employment State plan supplement.

    (a) The State plan must assure that the State has an acceptable plan 
under 34 CFR part 363 that provides for the use of funds under that part 
to supplement funds under this part for the cost of services leading to 
supported employment.
    (b) The supported employment plan, including any needed annual 
revisions, must be submitted as a supplement to the State plan submitted 
under this part.

(Approved by the Office of Management and Budget under control number 
1820-0500)

(Authority: Sections 101(a)(22) and 625(a) of the Act; 29 U.S.C. 
721(a)(22) and 795(k))

[66 FR 4382, Jan. 17, 2001, as amended at 66 FR 7253, Jan. 22, 2001]



Sec. 361.35  Innovation and expansion activities.

    (a) The State plan must assure that the State will reserve and use a 
portion of the funds allotted to the State under section 110 of the 
Act--
    (1) For the development and implementation of innovative approaches 
to expand and improve the provision of vocational rehabilitation 
services to individuals with disabilities, particularly individuals with 
the most significant disabilities, consistent with the findings of the 
comprehensive, statewide assessment of the rehabilitation needs of 
individuals with disabilities under Sec. 361.29(a) and the State's 
goals and priorities under Sec. 361.29(c); and
    (2) To support the funding of--
    (i) The State Rehabilitation Council, if the State has a Council, 
consistent with the resource plan identified in Sec. 361.17(i); and
    (ii) The Statewide Independent Living Council, consistent with the 
plan prepared under 34 CFR 364.21(i).
    (b) The State plan must--
    (1) Describe how the reserved funds will be used; and
    (2) Include, on an annual basis, a report describing how the 
reserved funds were used during the preceding year.

(Approved by the Office of Management and Budget under control number 
1820-0500)

(Authority: Section 101(a)(18) of the Act; 29 U.S.C. 721(a)(18))

[66 FR 4382, Jan. 17, 2001, as amended at 66 FR 7253, Jan. 22, 2001]



Sec. 361.36  Ability to serve all eligible individuals; order of 
selection for services.

    (a) General provisions. (1) The designated State unit either must be 
able to provide the full range of services listed in section 103(a) of 
the Act and Sec. 361.48, as appropriate, to all eligible individuals 
or, in the event that vocational rehabilitation services cannot be 
provided to all eligible individuals in the State who apply for the 
services, include in the State plan the order to be followed in 
selecting eligible individuals to be provided vocational rehabilitation 
services.
    (2) The ability of the designated State unit to provide the full 
range of vocational rehabilitation services to all eligible individuals 
must be supported by a determination that satisfies the requirements of 
paragraph (b) or (c) of this section and a determination that, on the 
basis of the designated State unit's projected fiscal and personnel 
resources and its assessment of the rehabilitation needs of individuals 
with significant disabilities within the State, it can--
    (i) Continue to provide services to all individuals currently 
receiving services;
    (ii) Provide assessment services to all individuals expected to 
apply for services in the next fiscal year;
    (iii) Provide services to all individuals who are expected to be 
determined eligible in the next fiscal year; and
    (iv) Meet all program requirements.
    (3) If the designated State unit is unable to provide the full range 
vocational rehabilitation services to all eligible individuals in the 
State who apply for the services, the State plan must--
    (i) Show the order to be followed in selecting eligible individuals 
to be provided vocational rehabilitation services;

[[Page 274]]

    (ii) Provide a justification for the order of selection;
    (iii) Identify service and outcome goals and the time within which 
the goals may be achieved for individuals in each priority category 
within the order, as required under Sec. 361.29(c)(5); and
    (iv) Assure that--
    (A) In accordance with criteria established by the State for the 
order of selection, individuals with the most significant disabilities 
will be selected first for the provision of vocational rehabilitation 
services; and
    (B) Individuals who do not meet the order of selection criteria will 
have access to services provided through the information and referral 
system established under Sec. 361.37.
    (b) Basis for assurance that services can be provided to all 
eligible individuals. (1) For a designated State unit that determined, 
for the current fiscal year and the preceding fiscal year, that it is 
able to provide the full range of services, as appropriate, to all 
eligible individuals, the State unit, during the current fiscal and 
preceding fiscal year, must have in fact--
    (i) Provided assessment services to all applicants and the full 
range of services, as appropriate, to all eligible individuals;
    (ii) Made referral forms widely available throughout the State;
    (iii) Conducted outreach efforts to identify and serve individuals 
with disabilities who have been unserved or underserved by the 
vocational rehabilitation system; and
    (iv) Not delayed, through waiting lists or other means, 
determinations of eligibility, the development of individualized plans 
for employment for individuals determined eligible for vocational 
rehabilitation services, or the provision of services for eligible 
individuals for whom individualized plans for employment have been 
developed.
    (2) For a designated State unit that was unable to provide the full 
range of services to all eligible individuals during the current or 
preceding fiscal year or that has not met the requirements in paragraph 
(b)(1) of this section, the determination that the designated State unit 
is able to provide the full range of vocational rehabilitation services 
to all eligible individuals in the next fiscal year must be based on--
    (i) Circumstances that have changed that will allow the designated 
State unit to meet the requirements of paragraph (a)(2) of this section 
in the next fiscal year, including--
    (A) An estimate of the number of and projected costs of serving, in 
the next fiscal year, individuals with existing individualized plans for 
employment;
    (B) The projected number of individuals with disabilities who will 
apply for services and will be determined eligible in the next fiscal 
year and the projected costs of serving those individuals;
    (C) The projected costs of administering the program in the next 
fiscal year, including, but not limited to, costs of staff salaries and 
benefits, outreach activities, and required statewide studies; and
    (D) The projected revenues and projected number of qualified 
personnel for the program in the next fiscal year;
    (ii) Comparable data, as relevant, for the current or preceding 
fiscal year, or for both years, of the costs listed in paragraphs 
(b)(2)(i)(A) through (C) of this section and the resources identified in 
paragraph (b)(2)(i)(D) of this section and an explanation of any 
projected increases or decreases in these costs and resources; and
    (iii) A determination that the projected revenues and the projected 
number of qualified personnel for the program in the next fiscal year 
are adequate to cover the costs identified in paragraphs (b)(2)(i)(A) 
through (C) of this section to ensure the provision of the full range of 
services, as appropriate, to all eligible individuals.
    (c) Determining need for establishing and implementing an order of 
selection. (1) The designated State unit must determine, prior to the 
beginning of each fiscal year, whether to establish and implement an 
order of selection.
    (2) If the designated State unit determines that it does not need to 
establish an order of selection, it must reevaluate this determination 
whenever changed circumstances during the course of a fiscal year, such 
as a decrease in its fiscal or personnel resources or an increase in its 
program costs, indicate that it may no longer be

[[Page 275]]

able to provide the full range of services, as appropriate, to all 
eligible individuals, as described in paragraph (a)(2) of this section.
    (3) If a DSU establishes an order of selection, but determines that 
it does not need to implement that order at the beginning of the fiscal 
year, it must continue to meet the requirements of paragraph (a)(2) of 
this section, or it must implement the order of selection by closing one 
or more priority categories.
    (d) Establishing an order of selection--(1) Basis for order of 
selection. An order of selection must be based on a refinement of the 
three criteria in the definition of ``individual with a significant 
disability'' in section 7(21)(A) of the Act and Sec. 361.5(b)(31).
    (2) Factors that cannot be used in determining order of selection of 
eligible individuals. An order of selection may not be based on any 
other factors, including--
    (i) Any duration of residency requirement, provided the individual 
is present in the State;
    (ii) Type of disability;
    (iii) Age, gender, race, color, or national origin;
    (iv) Source of referral;
    (v) Type of expected employment outcome;
    (vi) The need for specific services or anticipated cost of services 
required by an individual; or
    (vii) The income level of an individual or an individual's family.
    (e) Administrative requirements. In administering the order of 
selection, the designated State unit must--
    (1) Implement the order of selection on a statewide basis;
    (2) Notify all eligible individuals of the priority categories in a 
State's order of selection, their assignment to a particular category, 
and their right to appeal their category assignment;
    (3) Continue to provide all needed services to any eligible 
individual who has begun to receive services under an individualized 
plan for employment prior to the effective date of the order of 
selection, irrespective of the severity of the individual's disability; 
and
    (4) Ensure that its funding arrangements for providing services 
under the State plan, including third-party arrangements and awards 
under the establishment authority, are consistent with the order of 
selection. If any funding arrangements are inconsistent with the order 
of selection, the designated State unit must renegotiate these funding 
arrangements so that they are consistent with the order of selection.
    (f) State Rehabilitation Council. The designated State unit must 
consult with the State Rehabilitation Council, if the State unit has a 
Council, regarding the--
    (1) Need to establish an order of selection, including any 
reevaluation of the need under paragraph (c)(2) of this section;
    (2) Priority categories of the particular order of selection;
    (3) Criteria for determining individuals with the most significant 
disabilities; and
    (4) Administration of the order of selection.

(Approved by the Office of Management and Budget under control number 
1820-0500)

(Authority: Sections 12(d); 101(a)(5); 101(a)(12); 101(a)(15)(A), (B) 
and (C); 101(a)(21)(A)(ii); and 504(a) of the Act; 29 U.S.C. 709(d), 
721(a)(5), 721(a)(12), 721(a)(15)(A), (B) and (C); 721(a)(21)(A)(ii), 
and 794(a))

[66 FR 4382, Jan. 17, 2001, as amended at 66 FR 7253, Jan. 22, 2001]



Sec. 361.37  Information and referral programs.

    (a) General provisions. The State plan must assure that--
    (1) The designated State agency will implement an information and 
referral system adequate to ensure that individuals with disabilities, 
including eligible individuals who do not meet the agency's order of 
selection criteria for receiving vocational rehabilitation services if 
the agency is operating on an order of selection, are provided accurate 
vocational rehabilitation information and guidance (which may include 
counseling and referral for job placement) using appropriate modes of 
communication to assist them in preparing for, securing, retaining, or 
regaining employment; and
    (2) The designated State agency will refer individuals with 
disabilities to other appropriate Federal and State programs, including 
other components

[[Page 276]]

of the statewide workforce investment system.
    (b) The State unit must refer to local extended employment providers 
an individual with a disability who makes an informed choice to pursue 
extended employment as the individual's employment goal. Before making 
the referral required by this paragraph, the State unit must--
    (1) Consistent with Sec. 361.42(a)(4)(i) of this part, explain to 
the individual that the purpose of the vocational rehabilitation program 
is to assist individuals to achieve an employment outcome as defined in 
Sec. 361.5(b)(16) (i.e., employment in an integrated setting);
    (2) Consistent with Sec. 361.52 of this part, provide the 
individual with information concerning the availability of employment 
options, and of vocational rehabilitation services, in integrated 
settings;
    (3) Inform the individual that services under the vocational 
rehabilitation program can be provided to eligible individuals in an 
extended employment setting if necessary for purposes of training or 
otherwise preparing for employment in an integrated setting;
    (4) Inform the individual that, if he or she initially chooses not 
to pursue employment in an integrated setting, he or she can seek 
services from the designated State unit at a later date if, at that 
time, he or she chooses to pursue employment in an integrated setting; 
and
    (5) Refer the individual, as appropriate, to the Social Security 
Administration in order to obtain information concerning the ability of 
individuals with disabilities to work while receiving benefits from the 
Social Security Administration.
    (c) Criteria for appropriate referrals. In making the referrals 
identified in paragraph (a)(2) of this section, the designated State 
unit must--
    (1) Refer the individual to Federal or State programs, including 
programs carried out by other components of the statewide workforce 
investment system, best suited to address the specific employment needs 
of an individual with a disability; and
    (2) Provide the individual who is being referred--
    (i) A notice of the referral by the designated State agency to the 
agency carrying out the program;
    (ii) Information identifying a specific point of contact within the 
agency to which the individual is being referred; and
    (iii) Information and advice regarding the most suitable services to 
assist the individual to prepare for, secure, retain, or regain 
employment.
    (d) Order of selection. In providing the information and referral 
services under this section to eligible individuals who are not in the 
priority category or categories to receive vocational rehabilitation 
services under the State's order of selection, the State unit must 
identify, as part of its reporting under section 101(a)(10) of the Act 
and Sec. 361.40, the number of eligible individuals who did not meet 
the agency's order of selection criteria for receiving vocational 
rehabilitation services and did receive information and referral 
services under this section.

(Approved by the Office of Management and Budget under control number 
1820-0500)

(Authority: Sections 7(11), 12(c), 101(a)(5)(D), 101(a)(10)(C)(ii), and 
101(a)(20) of the Act; 29 U.S.C. 709(c), 721(a)(5)(D), 
721(a)(10)(C)(ii), and 721(a)(20))

[66 FR 4382, Jan. 17, 2001, as amended at 66 FR 7253, Jan. 22, 2001]



Sec. 361.38  Protection, use, and release of personal information.

    (a) General provisions. (1) The State agency and the State unit must 
adopt and implement written policies and procedures to safeguard the 
confidentiality of all personal information, including photographs and 
lists of names. These policies and procedures must ensure that--
    (i) Specific safeguards are established to protect current and 
stored personal information;
    (ii) All applicants and eligible individuals and, as appropriate, 
those individuals' representatives, service providers, cooperating 
agencies, and interested persons are informed through appropriate modes 
of communication of the confidentiality of personal information and the 
conditions for accessing and releasing this information;
    (iii) All applicants or their representatives are informed about the 
State

[[Page 277]]

unit's need to collect personal information and the policies governing 
its use, including--
    (A) Identification of the authority under which information is 
collected;
    (B) Explanation of the principal purposes for which the State unit 
intends to use or release the information;
    (C) Explanation of whether providing requested information to the 
State unit is mandatory or voluntary and the effects of not providing 
requested information;
    (D) Identification of those situations in which the State unit 
requires or does not require informed written consent of the individual 
before information may be released; and
    (E) Identification of other agencies to which information is 
routinely released;
    (iv) An explanation of State policies and procedures affecting 
personal information will be provided to each individual in that 
individual's native language or through the appropriate mode of 
communication; and
    (v) These policies and procedures provide no fewer protections for 
individuals than State laws and regulations.
    (2) The State unit may establish reasonable fees to cover 
extraordinary costs of duplicating records or making extensive searches 
and must establish policies and procedures governing access to records.
    (b) State program use. All personal information in the possession of 
the State agency or the designated State unit must be used only for the 
purposes directly connected with the administration of the vocational 
rehabilitation program. Information containing identifiable personal 
information may not be shared with advisory or other bodies that do not 
have official responsibility for administration of the program. In the 
administration of the program, the State unit may obtain personal 
information from service providers and cooperating agencies under 
assurances that the information may not be further divulged, except as 
provided under paragraphs (c), (d), and (e) of this section.
    (c) Release to applicants and eligible individuals. (1) Except as 
provided in paragraphs (c)(2) and (c)(3) of this section, if requested 
in writing by an applicant or eligible individual, the State unit must 
make all requested information in that individual's record of services 
accessible to and must release the information to the individual or the 
individual's representative in a timely manner.
    (2) Medical, psychological, or other information that the State unit 
determines may be harmful to the individual may not be released directly 
to the individual, but must be provided to the individual through a 
third party chosen by the individual, which may include, among others, 
an advocate, a family member, or a qualified medical or mental health 
professional, unless a representative has been appointed by a court to 
represent the individual, in which case the information must be released 
to the court-appointed representative.
    (3) If personal information has been obtained from another agency or 
organization, it may be released only by, or under the conditions 
established by, the other agency or organization.
    (4) An applicant or eligible individual who believes that 
information in the individual's record of services is inaccurate or 
misleading may request that the designated State unit amend the 
information. If the information is not amended, the request for an 
amendment must be documented in the record of services, consistent with 
Sec. 361.47(a)(12).
    (d) Release for audit, evaluation, and research. Personal 
information may be released to an organization, agency, or individual 
engaged in audit, evaluation, or research only for purposes directly 
connected with the administration of the vocational rehabilitation 
program or for purposes that would significantly improve the quality of 
life for applicants and eligible individuals and only if the 
organization, agency, or individual assures that--
    (1) The information will be used only for the purposes for which it 
is being provided;
    (2) The information will be released only to persons officially 
connected with the audit, evaluation, or research;
    (3) The information will not be released to the involved individual;

[[Page 278]]

    (4) The information will be managed in a manner to safeguard 
confidentiality; and
    (5) The final product will not reveal any personal identifying 
information without the informed written consent of the involved 
individual or the individual's representative.
    (e) Release to other programs or authorities. (1) Upon receiving the 
informed written consent of the individual or, if appropriate, the 
individual's representative, the State unit may release personal 
information to another agency or organization for its program purposes 
only to the extent that the information may be released to the involved 
individual or the individual's representative and only to the extent 
that the other agency or organization demonstrates that the information 
requested is necessary for its program.
    (2) Medical or psychological information that the State unit 
determines may be harmful to the individual may be released if the other 
agency or organization assures the State unit that the information will 
be used only for the purpose for which it is being provided and will not 
be further released to the individual.
    (3) The State unit must release personal information if required by 
Federal law or regulations.
    (4) The State unit must release personal information in response to 
investigations in connection with law enforcement, fraud, or abuse, 
unless expressly prohibited by Federal or State laws or regulations, and 
in response to an order issued by a judge, magistrate, or other 
authorized judicial officer.
    (5) The State unit also may release personal information in order to 
protect the individual or others if the individual poses a threat to his 
or her safety or to the safety of others.

(Approved by the Office of Management and Budget under control number 
1820-0500)

(Authority: Sections 12(c) and 101(a)(6)(A) of the Act; 29 U.S.C. 709(c) 
and 721(a)(6)(A))

[66 FR 4382, Jan. 17, 2001, as amended at 66 FR 7253, Jan. 22, 2001]



Sec. 361.39  State-imposed requirements.

    The designated State unit must, upon request, identify those 
regulations and policies relating to the administration or operation of 
its vocational rehabilitation program that are State-imposed, including 
any regulations or policy based on State interpretation of any Federal 
law, regulations, or guideline.

(Authority: Section 17 of the Act; 29 U.S.C. 714)



Sec. 361.40  Reports.

    (a) The State plan must assure that the designated State agency will 
submit reports, including reports required under sections 13, 14, and 
101(a)(10) of the Act--
    (1) In the form and level of detail and at the time required by the 
Secretary regarding applicants for and eligible individuals receiving 
services under this part; and
    (2) In a manner that provides a complete count (other than the 
information obtained through sampling consistent with section 
101(a)(10)(E) of the Act) of the applicants and eligible individuals 
to--
    (i) Permit the greatest possible cross-classification of data; and
    (ii) Protect the confidentiality of the identity of each individual.
    (b) The designated State agency must comply with any requirements 
necessary to ensure the accuracy and verification of those reports.

(Approved by the Office of Management and Budget under control number 
1820-0500)

(Authority: Section 101(a)(10)(A) and (F) of the Act; 29 U.S.C. 
721(a)(10)(A) and (F))

[66 FR 4382, Jan. 17, 2001, as amended at 66 FR 7253, Jan. 22, 2001]

                     Provision and Scope of Services



Sec. 361.41  Processing referrals and applications.

    (a) Referrals. The designated State unit must establish and 
implement standards for the prompt and equitable handling of referrals 
of individuals for vocational rehabilitation services, including 
referrals of individuals made through the One-Stop service delivery 
systems established under section 121 of the Workforce Investment Act of 
1998. The standards must include timelines for making good faith efforts

[[Page 279]]

to inform these individuals of application requirements and to gather 
information necessary to initiate an assessment for determining 
eligibility and priority for services.
    (b) Applications. (1) Once an individual has submitted an 
application for vocational rehabilitation services, including 
applications made through common intake procedures in One-Stop centers 
established under section 121 of the Workforce Investment Act of 1998, 
an eligibility determination must be made within 60 days, unless--
    (i) Exceptional and unforeseen circumstances beyond the control of 
the designated State unit preclude making an eligibility determination 
within 60 days and the designated State unit and the individual agree to 
a specific extension of time; or
    (ii) An exploration of the individual's abilities, capabilities, and 
capacity to perform in work situations is carried out in accordance with 
Sec. 361.42(e) or, if appropriate, an extended evaluation is carried 
out in accordance with Sec. 361.42(f).
    (2) An individual is considered to have submitted an application 
when the individual or the individual's representative, as appropriate--
    (i)(A) Has completed and signed an agency application form;
    (B) Has completed a common intake application form in a One-Stop 
center requesting vocational rehabilitation services; or
    (C) Has otherwise requested services from the designated State unit;
    (ii) Has provided to the designated State unit information necessary 
to initiate an assessment to determine eligibility and priority for 
services; and
    (iii) Is available to complete the assessment process.
    (3) The designated State unit must ensure that its application forms 
are widely available throughout the State, particularly in the One-Stop 
centers established under section 121 of the Workforce Investment Act of 
1998.

(Approved by the Office of Management and Budget under control number 
1820-0500)

(Authority: Sections 101(a)(6)(A) and 102(a)(6) of the Act; 29 U.S.C. 
721(a)(6)(A) and 722(a)(6))

[66 FR 4382, Jan. 17, 2001, as amended at 66 FR 7253, Jan. 22, 2001]



Sec. 361.42  Assessment for determining eligibility and priority for 
services.

    In order to determine whether an individual is eligible for 
vocational rehabilitation services and the individual's priority under 
an order of selection for services (if the State is operating under an 
order of selection), the designated State unit must conduct an 
assessment for determining eligibility and priority for services. The 
assessment must be conducted in the most integrated setting possible, 
consistent with the individual's needs and informed choice, and in 
accordance with the following provisions:
    (a) Eligibility requirements--(1) Basic requirements. The designated 
State unit's determination of an applicant's eligibility for vocational 
rehabilitation services must be based only on the following 
requirements:
    (i) A determination by qualified personnel that the applicant has a 
physical or mental impairment.
    (ii) A determination by qualified personnel that the applicant's 
physical or mental impairment constitutes or results in a substantial 
impediment to employment for the applicant.
    (iii) A determination by a qualified vocational rehabilitation 
counselor employed by the designated State unit that the applicant 
requires vocational rehabilitation services to prepare for, secure, 
retain, or regain employment consistent with the applicant's unique 
strengths, resources, priorities, concerns, abilities, capabilities, 
interests, and informed choice.
    (iv) A presumption, in accordance with paragraph (a)(2) of this 
section, that the applicant can benefit in terms of an employment 
outcome from the provision of vocational rehabilitation services.
    (2) Presumption of benefit. The designated State unit must presume 
that an applicant who meets the eligibility requirements in paragraphs 
(a)(1)(i) and (ii) of this section can benefit in terms of an employment 
outcome unless it demonstrates, based on clear and convincing evidence, 
that the applicant is incapable of benefiting in terms of an employment 
outcome from vocational rehabilitation services due to the severity of 
the applicant's disability.

[[Page 280]]

    (3) Presumption of eligibility for Social Security recipients and 
beneficiaries. (i) Any applicant who has been determined eligible for 
Social Security benefits under Title II or Title XVI of the Social 
Security Act is--
    (A) Presumed eligible for vocational rehabilitation services under 
paragraphs (a)(1) and (2) of this section; and
    (B) Considered an individual with a significant disability as 
defined in Sec. 361.5(b)(31).
    (ii) If an applicant for vocational rehabilitation services asserts 
that he or she is eligible for Social Security benefits under Title II 
or Title XVI of the Social Security Act (and, therefore, is presumed 
eligible for vocational rehabilitation services under paragraph 
(a)(3)(i)(A) of this section), but is unable to provide appropriate 
evidence, such as an award letter, to support that assertion, the State 
unit must verify the applicant's eligibility under Title II or Title XVI 
of the Social Security Act by contacting the Social Security 
Administration. This verification must be made within a reasonable 
period of time that enables the State unit to determine the applicant's 
eligibility for vocational rehabilitation services within 60 days of the 
individual submitting an application for services in accordance with 
Sec. 361.41(b)(2).
    (4) Achievement of an employment outcome. Any eligible 
rehabilitation services is based on the individual being eligible for 
Social Security benefits under Title II or Title XVI of the Social 
Security Act, must intend to achieve an employment outcome that is 
consistent with the applicant's unique strengths, resources, priorities, 
concerns, abilities, capabilities, interests, and informed choice.
    (i) The State unit is responsible for informing individuals, through 
its application process for vocational rehabilitation services, that 
individuals who receive services under the program must intend to 
achieve an employment outcome.
    (ii) The applicant's completion of the application process for 
vocational rehabilitation services is sufficient evidence of the 
individual's intent to achieve an employment outcome, and no additional 
demonstration on the part of the applicant is required for purposes of 
satisfying paragraph (a)(4) of this section.
    (5) Interpretation. Nothing in this section, including paragraph 
(a)(3)(i), is to be construed to create an entitlement to any vocational 
rehabilitation service.
    (b) Interim determination of eligibility. (1) The designated State 
unit may initiate the provision of vocational rehabilitation services 
for an applicant on the basis of an interim determination of eligibility 
prior to the 60-day period described in Sec. 361.41(b)(2).
    (2) If a State chooses to make interim determinations of 
eligibility, the designated State unit must--
    (i) Establish criteria and conditions for making those 
determinations;
    (ii) Develop and implement procedures for making the determinations; 
and
    (iii) Determine the scope of services that may be provided pending 
the final determination of eligibility.
    (3) If a State elects to use an interim eligibility determination, 
the designated State unit must make a final determination of eligibility 
within 60 days of the individual submitting an application for services 
in accordance with Sec. 361.41(b)(2).
    (c) Prohibited factors. (1) The State plan must assure that the 
State unit will not impose, as part of determining eligibility under 
this section, a duration of residence requirement that excludes from 
services any applicant who is present in the State.
    (2) In making a determination of eligibility under this section, the 
designated State unit also must ensure that--
    (i) No applicant or group of applicants is excluded or found 
ineligible solely on the basis of the type of disability; and
    (ii) The eligibility requirements are applied without regard to 
the--
    (A) Age, gender, race, color, or national origin of the applicant;
    (B) Type of expected employment outcome;
    (C) Source of referral for vocational rehabilitation services; and
    (D) Particular service needs or anticipated cost of services 
required by

[[Page 281]]

an applicant or the income level of an applicant or applicant's family.
    (d) Review and assessment of data for eligibility determination. 
Except as provided in paragraph (e) of this section, the designated 
State unit--
    (1) Must base its determination of each of the basic eligibility 
requirements in paragraph (a) of this section on--
    (i) A review and assessment of existing data, including counselor 
observations, education records, information provided by the individual 
or the individual's family, particularly information used by education 
officials, and determinations made by officials of other agencies; and
    (ii) To the extent existing data do not describe the current 
functioning of the individual or are unavailable, insufficient, or 
inappropriate to make an eligibility determination, an assessment of 
additional data resulting from the provision of vocational 
rehabilitation services, including trial work experiences, assistive 
technology devices and services, personal assistance services, and any 
other support services that are necessary to determine whether an 
individual is eligible; and
    (2) Must base its presumption under paragraph (a)(3)(i) of this 
section that an applicant who has been determined eligible for Social 
Security benefits under Title II or Title XVI of the Social Security Act 
satisfies each of the basic eligibility requirements in paragraph (a) of 
this section on determinations made by the Social Security 
Administration.
    (e) Trial work experiences for individuals with significant 
disabilities. (1) Prior to any determination that an individual with a 
disability is incapable of benefiting from vocational rehabilitation 
services in terms of an employment outcome because of the severity of 
that individual's disability, the designated State unit must conduct an 
exploration of the individual's abilities, capabilities, and capacity to 
perform in realistic work situations to determine whether or not there 
is clear and convincing evidence to support such a determination.
    (2)(i) The designated State unit must develop a written plan to 
assess periodically the individual's abilities, capabilities, and 
capacity to perform in work situations through the use of trial work 
experiences, which must be provided in the most integrated setting 
possible, consistent with the informed choice and rehabilitation needs 
of the individual.
    (ii) Trial work experiences include supported employment, on-the-job 
training, and other experiences using realistic work settings.
    (iii) Trial work experiences must be of sufficient variety and over 
a sufficient period of time for the designated State unit to determine 
that--
    (A) There is sufficient evidence to conclude that the individual can 
benefit from the provision of vocational rehabilitation services in 
terms of an employment outcome; or
    (B) There is clear and convincing evidence that the individual is 
incapable of benefiting from vocational rehabilitation services in terms 
of an employment outcome due to the severity of the individual's 
disability.
    (iv) The designated State unit must provide appropriate supports, 
including assistive technology devices and services and personal 
assistance services, to accommodate the rehabilitation needs of the 
individual during the trial work experiences.
    (f) Extended evaluation for certain individuals with significant 
disabilities.
    (1) Under limited circumstances if an individual cannot take 
advantage of trial work experiences or if options for trial work 
experiences have been exhausted before the State unit is able to make 
the determinations described in paragraph (e)(2)(iii) of this section, 
the designated State unit must conduct an extended evaluation to make 
these determinations.
    (2) During the extended evaluation period, vocational rehabilitation 
services must be provided in the most integrated setting possible, 
consistent with the informed choice and rehabilitation needs of the 
individual.
    (3) During the extended evaluation period, the designated State unit 
must develop a written plan for providing services necessary to make a 
determination under paragraph (e)(2)(iii) of this section.

[[Page 282]]

    (4) During the extended evaluation period, the designated State unit 
provides only those services that are necessary to make the 
determinations described in paragraph (e)(2)(iii) of this section and 
terminates extended evaluation services when the State unit is able to 
make the determinations.
    (g) Data for determination of priority for services under an order 
of selection. If the designated State unit is operating under an order 
of selection for services, as provided in Sec. 361.36, the State unit 
must base its priority assignments on--
    (1) A review of the data that was developed under paragraphs (d) and 
(e) of this section to make the eligibility determination; and
    (2) An assessment of additional data, to the extent necessary.


(Authority: Sections 7(2)(A), 7(2)(B)(ii)(I), 7(2)(C), 7(2)(D), 
101(a)(12), 102(a)(1), 102(a)(2), 102(a)(3), 102(a)(4)(A), 102(a)(4)(B), 
102(a)(4)(C), 103(a)(1), 103(a)(9), 103(a)(10) and 103(a)(14) of the 
Act; 29 U.S.C. 705(2)(A), 705(2)(B)(ii)(I), 705(2)(C), 705(2)(D), 
721(a)(12), 722(a)(1), 722(a)(2), 722(a)(3), 722(a)(4)(A), 722(a)(4)(B), 
722(a)(4)(C), 723(a)(1), 723(a)(9), 723(a)(10) and 723(a)(14))

    Note to Sec. 361.42: Clear and convincing evidence means that the 
designated State unit shall have a high degree of certainty before it 
can conclude that an individual is incapable of benefiting from services 
in terms of an employment outcome. The ``clear and convincing'' standard 
constitutes the highest standard used in our civil system of law and is 
to be individually applied on a case-by-case basis. The term clear means 
unequivocal. For example, the use of an intelligence test result alone 
would not constitute clear and convincing evidence. Clear and convincing 
evidence might include a description of assessments, including 
situational assessments and supported employment assessments, from 
service providers who have concluded that they would be unable to meet 
the individual's needs due to the severity of the individual's 
disability. The demonstration of ``clear and convincing evidence'' must 
include, if appropriate, a functional assessment of skill development 
activities, with any necessary supports (including assistive 
technology), in real life settings. (S. Rep. No. 357, 102d Cong., 2d. 
Sess. 37-38 (1992))



Sec. 361.43  Procedures for ineligibility determination.

    If the State unit determines that an applicant is ineligible for 
vocational rehabilitation services or determines that an individual 
receiving services under an individualized plan for employment is no 
longer eligible for services, the State unit must--
    (a) Make the determination only after providing an opportunity for 
full consultation with the individual or, as appropriate, with the 
individual's representative;
    (b) Inform the individual in writing, supplemented as necessary by 
other appropriate modes of communication consistent with the informed 
choice of the individual, of the ineligibility determination, including 
the reasons for that determination, the requirements under this section, 
and the means by which the individual may express and seek remedy for 
any dissatisfaction, including the procedures for review of State unit 
personnel determinations in accordance with Sec. 361.57;
    (c) Provide the individual with a description of services available 
from a client assistance program established under 34 CFR part 370 and 
information on how to contact that program;
    (d) Refer the individual--
    (1) To other programs that are part of the One-Stop service delivery 
system under the Workforce Investment Act that can address the 
individual's training or employment-related needs; or
    (2) To local extended employment providers if the ineligibility 
determination is based on a finding that the individual is incapable of 
achieving an employment outcome as defined in Sec. 361.5(b)(16).
    (e) Review within 12 months and annually thereafter if requested by 
the individual or, if appropriate, by the individual's representative 
any ineligibility determination that is based on a finding that the 
individual is incapable of achieving an employment outcome. This review 
need not be conducted in situations in which the individual has refused 
it, the individual is no longer present in the State, the individual's 
whereabouts are unknown, or the individual's medical condition is 
rapidly progressive or terminal.

(Authority: Sections 12(c), 102(a)(5), and 102(c) of the Act; 29 U.S.C. 
709(c), 722(a)(5), and 722(c))

[66 FR 4382, Jan. 11, 2001, as amended at 66 FR 7253, Jan. 22, 2001]

[[Page 283]]



Sec. 361.44  Closure without eligibility determination.

    The designated State unit may not close an applicant's record of 
services prior to making an eligibility determination unless the 
applicant declines to participate in, or is unavailable to complete, an 
assessment for determining eligibility and priority for services, and 
the State unit has made a reasonable number of attempts to contact the 
applicant or, if appropriate, the applicant's representative to 
encourage the applicant's participation.

(Authority: Section 12(c) of the Act; 29 U.S.C. 709(c))



Sec. 361.45  Development of the individualized plan for employment.

    (a) General requirements. The State plan must assure that--
    (1) An individualized plan for employment (IPE) meeting the 
requirements of this section and Sec. 361.46 is developed and 
implemented in a timely manner for each individual determined to be 
eligible for vocational rehabilitation services or, if the designated 
State unit is operating under an order of selection in accordance with 
Sec. 361.36, for each eligible individual to whom the State unit is 
able to provide services; and
    (2) Services will be provided in accordance with the provisions of 
the IPE.
    (b) Purpose. (1) The designated State unit must conduct an 
assessment for determining vocational rehabilitation needs, if 
appropriate, for each eligible individual or, if the State is operating 
under an order of selection, for each eligible individual to whom the 
State is able to provide services. The purpose of this assessment is to 
determine the employment outcome, and the nature and scope of vocational 
rehabilitation services to be included in the IPE.
    (2) The IPE must be designed to achieve a specific employment 
outcome, as defined in Sec. 361.5(b)(16), that is selected by the 
individual consistent with the individual's unique strengths, resources, 
priorities, concerns, abilities, capabilities, interests, and informed 
choice.
    (c) Required information. The State unit must provide the following 
information to each eligible individual or, as appropriate, the 
individual's representative, in writing and, if appropriate, in the 
native language or mode of communication of the individual or the 
individual's representative:
    (1) Options for developing an IPE. Information on the available 
options for developing the IPE, including the option that an eligible 
individual or, as appropriate, the individual's representative may 
develop all or part of the IPE--
    (i) Without assistance from the State unit or other entity; or
    (ii) With assistance from--
    (A) A qualified vocational rehabilitation counselor employed by the 
State unit;
    (B) A qualified vocational rehabilitation counselor who is not 
employed by the State unit; or
    (C) Resources other than those in paragraph (A) or (B) of this 
section.
    (2) Additional information. Additional information to assist the 
eligible individual or, as appropriate, the individual's representative 
in developing the IPE, including--
    (i) Information describing the full range of components that must be 
included in an IPE;
    (ii) As appropriate to each eligible individual--
    (A) An explanation of agency guidelines and criteria for determining 
an eligible individual's financial commitments under an IPE;
    (B) Information on the availability of assistance in completing 
State unit forms required as part of the IPE; and
    (C) Additional information that the eligible individual requests or 
the State unit determines to be necessary to the development of the IPE;
    (iii) A description of the rights and remedies available to the 
individual, including, if appropriate, recourse to the processes 
described in Sec. 361.57; and
    (iv) A description of the availability of a client assistance 
program established under 34 CFR part 370 and information on how to 
contact the client assistance program.
    (d) Mandatory procedures. The designated State unit must ensure 
that--
    (1) The IPE is a written document prepared on forms provided by the 
State unit;
    (2) The IPE is developed and implemented in a manner that gives 
eligible

[[Page 284]]

individuals the opportunity to exercise informed choice, consistent with 
Sec. 361.52, in selecting--
    (i) The employment outcome, including the employment setting;
    (ii) The specific vocational rehabilitation services needed to 
achieve the employment outcome, including the settings in which services 
will be provided;
    (iii) The entity or entities that will provide the vocational 
rehabilitation services; and
    (iv) The methods available for procuring the services;
    (3) The IPE is--
    (i) Agreed to and signed by the eligible individual or, as 
appropriate, the individual's representative; and
    (ii) Approved and signed by a qualified vocational rehabilitation 
counselor employed by the designated State unit;
    (4) A copy of the IPE and a copy of any amendments to the IPE are 
provided to the eligible individual or, as appropriate, to the 
individual's representative, in writing and, if appropriate, in the 
native language or mode of communication of the individual or, as 
appropriate, the individual's representative;
    (5) The IPE is reviewed at least annually by a qualified vocational 
rehabilitation counselor and the eligible individual or, as appropriate, 
the individual's representative to assess the eligible individual's 
progress in achieving the identified employment outcome;
    (6) The IPE is amended, as necessary, by the individual or, as 
appropriate, the individual's representative, in collaboration with a 
representative of the State unit or a qualified vocational 
rehabilitation counselor (to the extent determined to be appropriate by 
the individual), if there are substantive changes in the employment 
outcome, the vocational rehabilitation services to be provided, or the 
providers of the vocational rehabilitation services;
    (7) Amendments to the IPE do not take effect until agreed to and 
signed by the eligible individual or, as appropriate, the individual's 
representative and by a qualified vocational rehabilitation counselor 
employed by the designated State unit; and
    (8) An IPE for a student with a disability receiving special 
education services is developed--
    (i) In consideration of the student's IEP; and
    (ii) In accordance with the plans, policies, procedures, and terms 
of the interagency agreement required under Sec. 361.22.
    (e) Standards for developing the IPE. The designated State unit must 
establish and implement standards for the prompt development of IPEs for 
the individuals identified under paragraph (a) of this section, 
including timelines that take into consideration the needs of the 
individuals.
    (f) Data for preparing the IPE.
    (1) Preparation without comprehensive assessment. To the extent 
possible, the employment outcome and the nature and scope of 
rehabilitation services to be included in the individual's IPE must be 
determined based on the data used for the assessment of eligibility and 
priority for services under Sec. 361.42.
    (2) Preparation based on comprehensive assessment.
    (i) If additional data are necessary to determine the employment 
outcome and the nature and scope of services to be included in the IPE 
of an eligible individual, the State unit must conduct a comprehensive 
assessment of the unique strengths, resources, priorities, concerns, 
abilities, capabilities, interests, and informed choice, including the 
need for supported employment services, of the eligible individual, in 
the most integrated setting possible, consistent with the informed 
choice of the individual in accordance with the provisions of Sec. 
361.5(b)(6)(ii).
    (ii) In preparing the comprehensive assessment, the State unit must 
use, to the maximum extent possible and appropriate and in accordance 
with confidentiality requirements, existing information that is current 
as of the date of the development of the IPE, including--
    (A) Information available from other programs and providers, 
particularly information used by education officials and the Social 
Security Administration;
    (B) Information provided by the individual and the individual's 
family; and

[[Page 285]]

    (C) Information obtained under the assessment for determining the 
individual's eligibility and vocational rehabilitation needs.

(Authority: Sections 7(2)(B), 101(a)(9), 102(b)(1), 102(b)(2), 102(c) 
and 103(a)(1); 29 U.S.C. 705(2)(B), 721(a)(9), 722(b)(1), 722(b)(2), 
722(c) and 723(a)(1))

[66 FR 4382, Jan. 17, 2001, as amended at 66 FR 7253, Jan. 22, 2001]



Sec. 361.46  Content of the individualized plan for employment.

    (a) Mandatory components. Regardless of the approach in Sec. 
361.45(c)(1) that an eligible individual selects for purposes of 
developing the IPE, each IPE must include--
    (1) A description of the specific employment outcome, as defined in 
Sec. 361.5(b)(16), that is chosen by the eligible individual and is 
consistent with the individual's unique strengths, resources, 
priorities, concerns, abilities, capabilities, career interests, and 
informed choice.
    (2) A description of the specific rehabilitation services under 
Sec. 361.48 that are--
    (i) Needed to achieve the employment outcome, including, as 
appropriate, the provision of assistive technology devices, assistive 
technology services, and personal assistance services, including 
training in the management of those services; and
    (ii) Provided in the most integrated setting that is appropriate for 
the services involved and is consistent with the informed choice of the 
eligible individual;
    (3) Timelines for the achievement of the employment outcome and for 
the initiation of services;
    (4) A description of the entity or entities chosen by the eligible 
individual or, as appropriate, the individual's representative that will 
provide the vocational rehabilitation services and the methods used to 
procure those services;
    (5) A description of the criteria that will be used to evaluate 
progress toward achievement of the employment outcome; and
    (6) The terms and conditions of the IPE, including, as appropriate, 
information describing--
    (i) The responsibilities of the designated State unit;
    (ii) The responsibilities of the eligible individual, including--
    (A) The responsibilities the individual will assume in relation to 
achieving the employment outcome;
    (B) If applicable, the extent of the individual's participation in 
paying for the cost of services; and
    (C) The responsibility of the individual with regard to applying for 
and securing comparable services and benefits as described in Sec. 
361.53; and
    (iii) The responsibilities of other entities as the result of 
arrangements made pursuant to the comparable services or benefits 
requirements in Sec. 361.53.
    (b) Supported employment requirements. An IPE for an individual with 
a most significant disability for whom an employment outcome in a 
supported employment setting has been determined to be appropriate 
must--
    (1) Specify the supported employment services to be provided by the 
designated State unit;
    (2) Specify the expected extended services needed, which may include 
natural supports;
    (3) Identify the source of extended services or, to the extent that 
it is not possible to identify the source of extended services at the 
time the IPE is developed, include a description of the basis for 
concluding that there is a reasonable expectation that those sources 
will become available;
    (4) Provide for periodic monitoring to ensure that the individual is 
making satisfactory progress toward meeting the weekly work requirement 
established in the IPE by the time of transition to extended services;
    (5) Provide for the coordination of services provided under an IPE 
with services provided under other individualized plans established 
under other Federal or State programs;
    (6) To the extent that job skills training is provided, identify 
that the training will be provided on site; and
    (7) Include placement in an integrated setting for the maximum 
number of hours possible based on the unique strengths, resources, 
priorities, concerns, abilities, capabilities, interests, and informed 
choice of individuals with the most significant disabilities.

[[Page 286]]

    (c) Post-employment services. The IPE for each individual must 
contain, as determined to be necessary, statements concerning--
    (1) The expected need for post-employment services prior to closing 
the record of services of an individual who has achieved an employment 
outcome;
    (2) A description of the terms and conditions for the provision of 
any post-employment services; and
    (3) If appropriate, a statement of how post-employment services will 
be provided or arranged through other entities as the result of 
arrangements made pursuant to the comparable services or benefits 
requirements in Sec. 361.53.
    (d) Coordination of services for students with disabilities who are 
receiving special education services. The IPE for a student with a 
disability who is receiving special education services must be 
coordinated with the IEP for that individual in terms of the goals, 
objectives, and services identified in the IEP.

(Approved by the Office of Management and Budget under control number 
1820-0500)

(Authority: Sections 101(a)(8), 101(a)(9), 102(b)(3), and 625(b)(6) of 
the Act; 29 U.S.C. 721(a)(8), 721(a)(9), 722(b)(3), and 795(k))

[66 FR 4382, Jan. 17, 2001, as amended at 66 FR 7253, Jan. 22, 2001]



Sec. 361.47  Record of services.

    (a) The designated State unit must maintain for each applicant and 
eligible individual a record of services that includes, to the extent 
pertinent, the following documentation:
    (1) If an applicant has been determined to be an eligible 
individual, documentation supporting that determination in accordance 
with the requirements under Sec. 361.42.
    (2) If an applicant or eligible individual receiving services under 
an IPE has been determined to be ineligible, documentation supporting 
that determination in accordance with the requirements under Sec. 
361.43.
    (3) Documentation that describes the justification for closing an 
applicant's or eligible individual's record of services if that closure 
is based on reasons other than ineligibility, including, as appropriate, 
documentation indicating that the State unit has satisfied the 
requirements in Sec. 361.44.
    (4) If an individual has been determined to be an individual with a 
significant disability or an individual with a most significant 
disability, documentation supporting that determination.
    (5) If an individual with a significant disability requires an 
exploration of abilities, capabilities, and capacity to perform in 
realistic work situations through the use of trial work experiences or, 
as appropriate, an extended evaluation to determine whether the 
individual is an eligible individual, documentation supporting the need 
for, and the plan relating to, that exploration or, as appropriate, 
extended evaluation and documentation regarding the periodic assessments 
carried out during the trial work experiences or, as appropriate, the 
extended evaluation, in accordance with the requirements under Sec. 
361.42(e) and (f).
    (6) The IPE, and any amendments to the IPE, consistent with the 
requirements under Sec. 361.46.
    (7) Documentation describing the extent to which the applicant or 
eligible individual exercised informed choice regarding the provision of 
assessment services and the extent to which the eligible individual 
exercised informed choice in the development of the IPE with respect to 
the selection of the specific employment outcome, the specific 
vocational rehabilitation services needed to achieve the employment 
outcome, the entity to provide the services, the employment setting, the 
settings in which the services will be provided, and the methods to 
procure the services.
    (8) In the event that an individual's IPE provides for vocational 
rehabilitation services in a non-integrated setting, a justification to 
support the need for the non-integrated setting.
    (9) In the event that an individual obtains competitive employment, 
verification that the individual is compensated at or above the minimum 
wage and that the individual's wage and level of benefits are not less 
than that customarily paid by the employer for the same or similar work 
performed by non-disabled individuals in accordance with Sec. 
361.5(b)(11)(ii).
    (10) In the event an individual achieves an employment outcome in

[[Page 287]]

which the individual is compensated in accordance with section 14(c) of 
the Fair Labor Standards Act or the designated State unit closes the 
record of services of an individual in extended employment on the basis 
that the individual is unable to achieve an employment outcome 
consistent with Sec. 361.5(b)(16) or that an eligible individual 
through informed choice chooses to remain in extended employment, 
documentation of the results of the annual reviews required under Sec. 
361.55, of the individual's input into those reviews, and of the 
individual's or, if appropriate, the individual's representative's 
acknowledgment that those reviews were conducted.
    (11) Documentation concerning any action or decision resulting from 
a request by an individual under Sec. 361.57 for a review of 
determinations made by designated State unit personnel.
    (12) In the event that an applicant or eligible individual requests 
under Sec. 361.38(c)(4) that documentation in the record of services be 
amended and the documentation is not amended, documentation of the 
request.
    (13) In the event an individual is referred to another program 
through the State unit's information and referral system under Sec. 
361.37, including other components of the statewide workforce investment 
system, documentation on the nature and scope of services provided by 
the designated State unit to the individual and on the referral itself, 
consistent with the requirements of Sec. 361.37.
    (14) In the event an individual's record of service is closed under 
Sec. 361.56, documentation that demonstrates the services provided 
under the individual's IPE contributed to the achievement of the 
employment outcome.
    (15) In the event an individual's record of service is closed under 
Sec. 361.56, documentation verifying that the provisions of Sec. 
361.56 have been satisfied.
    (b) The State unit, in consultation with the State Rehabilitation 
Council if the State has a Council, must determine the type of 
documentation that the State unit must maintain for each applicant and 
eligible individual in order to meet the requirements in paragraph (a) 
of this section.

(Approved by the Office of Management and Budget under control number 
1820-0500)

(Authority: Sections 101(a)(6), (9), (14), (20) and 102(a), (b), and (d) 
of the Act; 29 U.S.C. 721(a)(6), (9), (14), (20) and 722(a), (b), and 
(d))

[66 FR 4382, Jan. 17, 2001, as amended at 66 FR 7253, Jan. 22, 2001]



Sec. 361.48  Scope of vocational rehabilitation services for individuals 
with disabilities.

    As appropriate to the vocational rehabilitation needs of each 
individual and consistent with each individual's informed choice, the 
designated State unit must ensure that the following vocational 
rehabilitation services are available to assist the individual with a 
disability in preparing for, securing, retaining, or regaining an 
employment outcome that is consistent with the individual's strengths, 
resources, priorities, concerns, abilities, capabilities, interests, and 
informed choice:
    (a) Assessment for determining eligibility and priority for services 
by qualified personnel, including, if appropriate, an assessment by 
personnel skilled in rehabilitation technology, in accordance with Sec. 
361.42.
    (b) Assessment for determining vocational rehabilitation needs by 
qualified personnel, including, if appropriate, an assessment by 
personnel skilled in rehabilitation technology, in accordance with Sec. 
361.45.
    (c) Vocational rehabilitation counseling and guidance, including 
information and support services to assist an individual in exercising 
informed choice in accordance with Sec. 361.52.
    (d) Referral and other services necessary to assist applicants and 
eligible individuals to secure needed services from other agencies, 
including other components of the statewide workforce investment system, 
in accordance with Sec. Sec. 361.23, 361.24, and 361.37, and to advise 
those individuals about client assistance programs established under 34 
CFR part 370.
    (e) In accordance with the definition in Sec. 361.5(b)(40), 
physical and mental restoration services, to the extent that financial 
support is not readily available from a source other than the designated 
State unit (such as through

[[Page 288]]

health insurance or a comparable service or benefit as defined in Sec. 
361.5(b)(10)).
    (f) Vocational and other training services, including personal and 
vocational adjustment training, books, tools, and other training 
materials, except that no training or training services in an 
institution of higher education (universities, colleges, community or 
junior colleges, vocational schools, technical institutes, or hospital 
schools of nursing) may be paid for with funds under this part unless 
maximum efforts have been made by the State unit and the individual to 
secure grant assistance in whole or in part from other sources to pay 
for that training.
    (g) Maintenance, in accordance with the definition of that term in 
Sec. 361.5(b)(35).
    (h) Transportation in connection with the rendering of any 
vocational rehabilitation service and in accordance with the definition 
of that term in Sec. 361.5(b)(57).
    (i) Vocational rehabilitation services to family members, as defined 
in Sec. 361.5(b)(23), of an applicant or eligible individual if 
necessary to enable the applicant or eligible individual to achieve an 
employment outcome.
    (j) Interpreter services, including sign language and oral 
interpreter services, for individuals who are deaf or hard of hearing 
and tactile interpreting services for individuals who are deaf-blind 
provided by qualified personnel.
    (k) Reader services, rehabilitation teaching services, and 
orientation and mobility services for individuals who are blind.
    (l) Job-related services, including job search and placement 
assistance, job retention services, follow-up services, and follow-along 
services.
    (m) Supported employment services in accordance with the definition 
of that term in Sec. 361.5(b)(54).
    (n) Personal assistance services in accordance with the definition 
of that term in Sec. 361.5(b)(39).
    (o) Post-employment services in accordance with the definition of 
that term in Sec. 361.5(b)(42).
    (p) Occupational licenses, tools, equipment, initial stocks, and 
supplies.
    (q) Rehabilitation technology in accordance with the definition of 
that term in Sec. 361.5(b)(45), including vehicular modification, 
telecommunications, sensory, and other technological aids and devices.
    (r) Transition services in accordance with the definition of that 
term in Sec. 361.5(b)(55).
    (s) Technical assistance and other consultation services to conduct 
market analyses, develop business plans, and otherwise provide 
resources, to the extent those resources are authorized to be provided 
through the statewide workforce investment system, to eligible 
individuals who are pursuing self-employment or telecommuting or 
establishing a small business operation as an employment outcome.
    (t) Other goods and services determined necessary for the individual 
with a disability to achieve an employment outcome.

(Approved by the Office of Management and Budget under control number 
1820-0500)

(Authority: Section 103(a) of the Act; 29 U.S.C. 723(a))

[66 FR 4382, Jan. 17, 2001, as amended at 66 FR 7253, Jan. 22, 2001]



Sec. 361.49  Scope of vocational rehabilitation services for groups 
of individuals with disabilities.

    (a) The designated State unit may also provide for the following 
vocational rehabilitation services for the benefit of groups of 
individuals with disabilities:
    (1) The establishment, development, or improvement of a public or 
other nonprofit community rehabilitation program that is used to provide 
vocational rehabilitation services that promote integration and 
competitive employment, including, under special circumstances, the 
construction of a facility for a public or nonprofit community 
rehabilitation program. Examples of ``special circumstances'' include 
the destruction by natural disaster of the only available center serving 
an area or a State determination that construction is necessary in a 
rural area because no other public agencies or private nonprofit 
organizations are currently able to provide vocational rehabilitation 
services to individuals.

[[Page 289]]

    (2) Telecommunications systems that have the potential for 
substantially improving vocational rehabilitation service delivery 
methods and developing appropriate programming to meet the particular 
needs of individuals with disabilities, including telephone, television, 
video description services, satellite, tactile-vibratory devices, and 
similar systems, as appropriate.
    (3) Special services to provide nonvisual access to information for 
individuals who are blind, including the use of telecommunications, 
Braille, sound recordings, or other appropriate media; captioned 
television, films, or video cassettes for individuals who are deaf or 
hard of hearing; tactile materials for individuals who are deaf-blind; 
and other special services that provide information through tactile, 
vibratory, auditory, and visual media.
    (4) Technical assistance and support services to businesses that are 
not subject to Title I of the Americans with Disabilities Act of 1990 
and that are seeking to employ individuals with disabilities.
    (5) In the case of any small business enterprise operated by 
individuals with significant disabilities under the supervision of the 
designated State unit, including enterprises established under the 
Randolph-Sheppard program, management services and supervision provided 
by the State unit along with the acquisition by the State unit of 
vending facilities or other equipment, initial stocks and supplies, and 
initial operating expenses, in accordance with the following 
requirements:
    (i) ``Management services and supervision'' includes inspection, 
quality control, consultation, accounting, regulating, in-service 
training, and related services provided on a systematic basis to support 
and improve small business enterprises operated by individuals with 
significant disabilities. ``Management services and supervision'' may be 
provided throughout the operation of the small business enterprise.
    (ii) ``Initial stocks and supplies'' includes those items necessary 
to the establishment of a new business enterprise during the initial 
establishment period, which may not exceed 6 months.
    (iii) Costs of establishing a small business enterprise may include 
operational costs during the initial establishment period, which may not 
exceed 6 months.
    (iv) If the designated State unit provides for these services, it 
must ensure that only individuals with significant disabilities will be 
selected to participate in this supervised program.
    (v) If the designated State unit provides for these services and 
chooses to set aside funds from the proceeds of the operation of the 
small business enterprises, the State unit must maintain a description 
of the methods used in setting aside funds and the purposes for which 
funds are set aside. Funds may be used only for small business 
enterprises purposes, and benefits that are provided to operators from 
set-aside funds must be provided on an equitable basis.
    (6) Other services that promise to contribute substantially to the 
rehabilitation of a group of individuals but that are not related 
directly to the individualized plan for employment of any one 
individual. Examples of those other services might include the purchase 
or lease of a bus to provide transportation to a group of applicants or 
eligible individuals or the purchase of equipment or instructional 
materials that would benefit a group of applicants or eligible 
individuals.
    (7) Consultative and technical assistance services to assist 
educational agencies in planning for the transition of students with 
disabilities from school to post-school activities, including 
employment.
    (b) If the designated State unit provides for vocational 
rehabilitation services for groups of individuals, it must--
    (1) Develop and maintain written policies covering the nature and 
scope of each of the vocational rehabilitation services it provides and 
the criteria under which each service is provided; and
    (2) Maintain information to ensure the proper and efficient 
administration of those services in the form and detail and at the time 
required by the Secretary, including the types of services provided, the 
costs of those services, and, to the extent feasible, estimates of

[[Page 290]]

the numbers of individuals benefiting from those services.

(Approved by the Office of Management and Budget under control number 
1820-0500)

(Authority: Sections 12(c), 101(a)(6)(A), and 103(b) of the Act; 29 
U.S.C. 709(c), 721(a)(6), and 723(b))

[66 FR 4382, Jan. 17, 2001, as amended at 66 FR 7253, Jan. 22, 2001]



Sec. 361.50  Written policies governing the provision of services 
for individuals with disabilities.

    (a) Policies. The State unit must develop and maintain written 
policies covering the nature and scope of each of the vocational 
rehabilitation services specified in Sec. 361.48 and the criteria under 
which each service is provided. The policies must ensure that the 
provision of services is based on the rehabilitation needs of each 
individual as identified in that individual's IPE and is consistent with 
the individual's informed choice. The written policies may not establish 
any arbitrary limits on the nature and scope of vocational 
rehabilitation services to be provided to the individual to achieve an 
employment outcome. The policies must be developed in accordance with 
the following provisions:
    (b) Out-of-State services. (1) The State unit may establish a 
preference for in-State services, provided that the preference does not 
effectively deny an individual a necessary service. If the individual 
chooses an out-of-State service at a higher cost than an in-State 
service, if either service would meet the individual's rehabilitation 
needs, the designated State unit is not responsible for those costs in 
excess of the cost of the in-State service.
    (2) The State unit may not establish policies that effectively 
prohibit the provision of out-of-State services.
    (c) Payment for services.
    (1) The State unit must establish and maintain written policies to 
govern the rates of payment for all purchased vocational rehabilitation 
services.
    (2) The State unit may establish a fee schedule designed to ensure a 
reasonable cost to the program for each service, if the schedule is--
    (i) Not so low as to effectively deny an individual a necessary 
service; and
    (ii) Not absolute and permits exceptions so that individual needs 
can be addressed.
    (3) The State unit may not place absolute dollar limits on specific 
service categories or on the total services provided to an individual.
    (d) Duration of services.
    (1) The State unit may establish reasonable time periods for the 
provision of services provided that the time periods are--
    (i) Not so short as to effectively deny an individual a necessary 
service; and
    (ii) Not absolute and permit exceptions so that individual needs can 
be addressed.
    (2) The State unit may not establish absolute time limits on the 
provision of specific services or on the provision of services to an 
individual. The duration of each service needed by an individual must be 
determined on an individual basis and reflected in that individual's 
individualized plan for employment.
    (e) Authorization of services. The State unit must establish 
policies related to the timely authorization of services, including any 
conditions under which verbal authorization can be given.

(Approved by the Office of Management and Budget under control number 
1820-0500)

(Authority: Sections 12(c) and 101(a)(6) of the Act and 29 U.S.C. 709(c) 
and 721(a)(6))

[66 FR 4382, Jan. 17, 2001, as amended at 66 FR 7253, Jan. 22, 2001]



Sec. 361.51  Standards for facilities and providers of services.

    (a) Accessibility of facilities. The State plan must assure that any 
facility used in connection with the delivery of vocational 
rehabilitation services under this part meets program accessibility 
requirements consistent with the requirements, as applicable, of the 
Architectural Barriers Act of 1968, the Americans with Disabilities Act 
of 1990, section 504 of the Act, and the regulations implementing these 
laws.
    (b) Affirmative action. The State plan must assure that community 
rehabilitation programs that receive assistance under part B of Title I 
of the Act take affirmative action to employ and advance in employment 
qualified individuals with disabilities covered under

[[Page 291]]

and on the same terms and conditions as in section 503 of the Act.
    (c) Special communication needs personnel. The designated State unit 
must ensure that providers of vocational rehabilitation services are 
able to communicate--
    (1) In the native language of applicants and eligible individuals 
who have limited English speaking ability; and
    (2) By using appropriate modes of communication used by applicants 
and eligible individuals.

(Approved by the Office of Management and Budget under control number 
1820-0500)

(Authority: Sections 12(c) and 101(a)(6)(B) and (C) of the Act; 29 
U.S.C. 709(c) and 721(a)(6)(B) and (C))

[66 FR 4382, Jan. 17, 2001, as amended at 66 FR 7253, Jan. 22, 2001]



Sec. 361.52  Informed choice.

    (a) General provision. The State plan must assure that applicants 
and eligible individuals or, as appropriate, their representatives are 
provided information and support services to assist applicants and 
eligible individuals in exercising informed choice throughout the 
rehabilitation process consistent with the provisions of section 102(d) 
of the Act and the requirements of this section.
    (b) Written policies and procedures. The designated State unit, in 
consultation with its State Rehabilitation Council, if it has a Council, 
must develop and implement written policies and procedures that enable 
an applicant or eligible individual to exercise informed choice 
throughout the vocational rehabilitation process. These policies and 
procedures must provide for--
    (1) Informing each applicant and eligible individual (including 
students with disabilities who are making the transition from programs 
under the responsibility of an educational agency to programs under the 
responsibility of the designated State unit), through appropriate modes 
of communication, about the availability of and opportunities to 
exercise informed choice, including the availability of support services 
for individuals with cognitive or other disabilities who require 
assistance in exercising informed choice throughout the vocational 
rehabilitation process;
    (2) Assisting applicants and eligible individuals in exercising 
informed choice in decisions related to the provision of assessment 
services;
    (3) Developing and implementing flexible procurement policies and 
methods that facilitate the provision of vocational rehabilitation 
services and that afford eligible individuals meaningful choices among 
the methods used to procure vocational rehabilitation services;
    (4) Assisting eligible individuals or, as appropriate, the 
individuals' representatives in acquiring information that enables them 
to exercise informed choice in the development of their IPEs with 
respect to the selection of the--
    (i) Employment outcome;
    (ii) Specific vocational rehabilitation services needed to achieve 
the employment outcome;
    (iii) Entity that will provide the services;
    (iv) Employment setting and the settings in which the services will 
be provided; and
    (v) Methods available for procuring the services; and
    (5) Ensuring that the availability and scope of informed choice is 
consistent with the obligations of the designated State agency under 
this part.
    (c) Information and assistance in the selection of vocational 
rehabilitation services and service providers. In assisting an applicant 
and eligible individual in exercising informed choice during the 
assessment for determining eligibility and vocational rehabilitation 
needs and during development of the IPE, the designated State unit must 
provide the individual or the individual's representative, or assist the 
individual or the individual's representative in acquiring, information 
necessary to make an informed choice about the specific vocational 
rehabilitation services, including the providers of those services, that 
are needed to achieve the individual's employment outcome. This 
information must include, at a minimum, information relating to the--
    (1) Cost, accessibility, and duration of potential services;

[[Page 292]]

    (2) Consumer satisfaction with those services to the extent that 
information relating to consumer satisfaction is available;
    (3) Qualifications of potential service providers;
    (4) Types of services offered by the potential providers;
    (5) Degree to which services are provided in integrated settings; 
and
    (6) Outcomes achieved by individuals working with service providers, 
to the extent that such information is available.
    (d) Methods or sources of information. In providing or assisting the 
individual or the individual's representative in acquiring the 
information required under paragraph (c) of this section, the State unit 
may use, but is not limited to, the following methods or sources of 
information:
    (1) Lists of services and service providers.
    (2) Periodic consumer satisfaction surveys and reports.
    (3) Referrals to other consumers, consumer groups, or disability 
advisory councils qualified to discuss the services or service 
providers.
    (4) Relevant accreditation, certification, or other information 
relating to the qualifications of service providers.
    (5) Opportunities for individuals to visit or experience various 
work and service provider settings.

(Approved by the Office of Management and Budget under control number 
1820-0500)

(Authority: Sections 12(c), 101(a)(19); 102(b)(2)(B) and 102(d) of the 
Act; 29 U.S.C. 709(c), 721(a)(19); 722(b)(2)(B) and 722(d))

[66 FR 4382, Jan. 17, 2001, as amended at 66 FR 7253, Jan. 22, 2001]



Sec. 361.53  Comparable services and benefits.

    (a) Determination of availability. The State plan must assure that 
prior to providing any vocational rehabilitation services, except those 
services listed in paragraph (b) of this section, to an eligible 
individual, or to members of the individual's family, the State unit 
must determine whether comparable services and benefits, as defined in 
Sec. 361.5(b)(10), exist under any other program and whether those 
services and benefits are available to the individual unless such a 
determination would interrupt or delay--
    (1) The progress of the individual toward achieving the employment 
outcome identified in the individualized plan for employment;
    (2) An immediate job placement; or
    (3) The provision of vocational rehabilitation services to any 
individual who is determined to be at extreme medical risk, based on 
medical evidence provided by an appropriate qualified medical 
professional.
    (b) Exempt services. The following vocational rehabilitation 
services described in Sec. 361.48(a) are exempt from a determination of 
the availability of comparable services and benefits under paragraph (a) 
of this section:
    (1) Assessment for determining eligibility and vocational 
rehabilitation needs.
    (2) Counseling and guidance, including information and support 
services to assist an individual in exercising informed choice.
    (3) Referral and other services to secure needed services from other 
agencies, including other components of the statewide workforce 
investment system, if those services are not available under this part.
    (4) Job-related services, including job search and placement 
assistance, job retention services, follow-up services, and follow-along 
services.
    (5) Rehabilitation technology, including telecommunications, 
sensory, and other technological aids and devices.
    (6) Post-employment services consisting of the services listed under 
paragraphs (b)(1) through (5) of this section.
    (c) Provision of services. (1) If comparable services or benefits 
exist under any other program and are available to the individual at the 
time needed to ensure the progress of the individual toward achieving 
the employment outcome in the individual's IPE, the designated State 
unit must use those comparable services or benefits to meet, in whole or 
part, the costs of the vocational rehabilitation services.
    (2) If comparable services or benefits exist under any other 
program, but are not available to the individual at the time needed to 
ensure the progress of the individual toward achieving the

[[Page 293]]

employment outcome in the individual's IPE, the designated State unit 
must provide vocational rehabilitation services until those comparable 
services and benefits become available.
    (d) Interagency coordination. (1) The State plan must assure that 
the Governor, in consultation with the entity in the State responsible 
for the vocational rehabilitation program and other appropriate 
agencies, will ensure that an interagency agreement or other mechanism 
for interagency coordination takes effect between the designated State 
vocational rehabilitation unit and any appropriate public entity, 
including the State entity responsible for administering the State 
medicaid program, a public institution of higher education, and a 
component of the statewide workforce investment system, to ensure the 
provision of vocational rehabilitation services (other than those 
services listed in paragraph (b) of this section) that are included in 
the IPE, including the provision of those vocational rehabilitation 
services during the pendency of any interagency dispute in accordance 
with the provisions of paragraph (d)(3)(iii) of this section.
    (2) The Governor may meet the requirements of paragraph (d)(1) of 
this section through--
    (i) A State statute or regulation;
    (ii) A signed agreement between the respective officials of the 
public entities that clearly identifies the responsibilities of each 
public entity for the provision of the services; or
    (iii) Another appropriate mechanism as determined by the designated 
State vocational rehabilitation unit.
    (3) The interagency agreement or other mechanism for interagency 
coordination must include the following:
    (i) Agency financial responsibility. An identification of, or 
description of a method for defining, the financial responsibility of 
the public entity for providing the vocational rehabilitation services 
other than those listed in paragraph (b) of this section and a provision 
stating the financial responsibility of the public entity for providing 
those services.
    (ii) Conditions, terms, and procedures of reimbursement. Information 
specifying the conditions, terms, and procedures under which the 
designated State unit must be reimbursed by the other public entities 
for providing vocational rehabilitation services based on the terms of 
the interagency agreement or other mechanism for interagency 
coordination.
    (iii) Interagency disputes. Information specifying procedures for 
resolving interagency disputes under the interagency agreement or other 
mechanism for interagency coordination, including procedures under which 
the designated State unit may initiate proceedings to secure 
reimbursement from other public entities or otherwise implement the 
provisions of the agreement or mechanism.
    (iv) Procedures for coordination of services. Information specifying 
policies and procedures for public entities to determine and identify 
interagency coordination responsibilities of each public entity to 
promote the coordination and timely delivery of vocational 
rehabilitation services other than those listed in paragraph (b) of this 
section.
    (e) Responsibilities under other law.
    (1) If a public entity (other than the designated State unit) is 
obligated under Federal law (such as the Americans with Disabilities 
Act, section 504 of the Act, or section 188 of the Workforce Investment 
Act) or State law, or assigned responsibility under State policy or an 
interagency agreement established under this section, to provide or pay 
for any services considered to be vocational rehabilitation services 
(e.g., interpreter services under Sec. 361.48(j)), other than those 
services listed in paragraph (b) of this section, the public entity must 
fulfill that obligation or responsibility through--
    (i) The terms of the interagency agreement or other requirements of 
this section;
    (ii) Providing or paying for the service directly or by contract; or
    (iii) Other arrangement.
    (2) If a public entity other than the designated State unit fails to 
provide or pay for vocational rehabilitation services for an eligible 
individual as established under this section, the designated State unit 
must provide or pay for those services to the individual and may claim 
reimbursement for the services from the public entity that failed

[[Page 294]]

to provide or pay for those services. The public entity must reimburse 
the designated State unit pursuant to the terms of the interagency 
agreement or other mechanism described in paragraph (d) of this section 
in accordance with the procedures established in the agreement or 
mechanism pursuant to paragraph (d)(3)(ii) of this section.

(Approved by the Office of Management and Budget under control number 
1820-0500)

(Authority: Sections 12(c) and 101(a)(8) of the Act; 29 U.S.C. 709(c) 
and 721(a)(8))

[66 FR 4382, Jan. 17, 2001, as amended at 66 FR 7253, Jan. 22, 2001]



Sec. 361.54  Participation of individuals in cost of services based 
on financial need.

    (a) No Federal requirement. There is no Federal requirement that the 
financial need of individuals be considered in the provision of 
vocational rehabilitation services.
    (b) State unit requirements. (1) The State unit may choose to 
consider the financial need of eligible individuals or individuals who 
are receiving services through trial work experiences under Sec. 
361.42(e) or during an extended evaluation under Sec. 361.42(f) for 
purposes of determining the extent of their participation in the costs 
of vocational rehabilitation services, other than those services 
identified in paragraph (b)(3) of this section.
    (2) If the State unit chooses to consider financial need--
    (i) It must maintain written policies--
    (A) Explaining the method for determining the financial need of an 
eligible individual; and
    (B) Specifying the types of vocational rehabilitation services for 
which the unit has established a financial needs test;
    (ii) The policies must be applied uniformly to all individuals in 
similar circumstances;
    (iii) The policies may require different levels of need for 
different geographic regions in the State, but must be applied uniformly 
to all individuals within each geographic region; and
    (iv) The policies must ensure that the level of an individual's 
participation in the cost of vocational rehabilitation services is--
    (A) Reasonable;
    (B) Based on the individual's financial need, including 
consideration of any disability-related expenses paid by the individual; 
and
    (C) Not so high as to effectively deny the individual a necessary 
service.
    (3) The designated State unit may not apply a financial needs test, 
or require the financial participation of the individual--
    (i) As a condition for furnishing the following vocational 
rehabilitation services:
    (A) Assessment for determining eligibility and priority for services 
under Sec. 361.48(a), except those non-assessment services that are 
provided to an individual with a significant disability during either an 
exploration of the individual's abilities, capabilities, and capacity to 
perform in work situations through the use of trial work experiences 
under Sec. 361.42(e) or an extended evaluation under Sec. 361.42(f).
    (B) Assessment for determining vocational rehabilitation needs under 
Sec. 361.48(b).
    (C) Vocational rehabilitation counseling and guidance under Sec. 
361.48(c).
    (D) Referral and other services under Sec. 361.48(d).
    (E) Job-related services under Sec. 361.48(l).
    (F) Personal assistance services under Sec. 361.48(n).
    (G) Any auxiliary aid or service (e.g., interpreter services under 
Sec. 361.48(j), reader services under Sec. 361.48(k)) that an 
individual with a disability requires under section 504 of the Act (29 
U.S.C. 794) or the Americans with Disabilities Act (42 U.S.C. 12101, et 
seq.), or regulations implementing those laws, in order for the 
individual to participate in the VR program as authorized under this 
part; or
    (ii) As a condition for furnishing any vocational rehabilitation 
service if the individual in need of the service has been determined 
eligible for Social Security benefits under Titles II or XVI of the 
Social Security Act.

(Approved by the Office of Management and Budget under control number 
1820-0500)

(Authority: Section 12(c) of the Act; 29 U.S.C. 709(c))

[66 FR 4382, Jan. 17, 2001, as amended at 66 FR 7253, Jan. 22, 2001]

[[Page 295]]



Sec. 361.55  Annual review of individuals in extended employment and 

other employment under special certificate provisions of the Fair 
Labor Standards Act.

    (a) The State plan must assure that the designated State unit 
conducts an annual review and reevaluation in accordance with the 
requirements in paragraph (b) of this section for an individual with a 
disability served under this part--
    (1) Who has achieved an employment outcome in which the individual 
is compensated in accordance with section 14(c) of the Fair Labor 
Standards Act; or
    (2) Whose record of services is closed while the individual is in 
extended employment on the basis that the individual is unable to 
achieve an employment outcome consistent with Sec. 361.5(b)(16) or that 
the individual made an informed choice to remain in extended employment.
    (b) For each individual with a disability who meets the criteria in 
paragraph (a) of this section, the designated State unit must--
    (1) Annually review and reevaluate the status of each individual for 
2 years after the individual's record of services is closed (and 
thereafter if requested by the individual or, if appropriate, the 
individual's representative) to determine the interests, priorities, and 
needs of the individual with respect to competitive employment or 
training for competitive employment;
    (2) Enable the individual or, if appropriate, the individual's 
representative to provide input into the review and reevaluation and 
must document that input in the record of services, consistent with 
Sec. 361.47(a)(10), with the individual's or, as appropriate, the 
individual's representative's signed acknowledgment that the review and 
reevaluation have been conducted; and
    (3) Make maximum efforts, including identifying and providing 
vocational rehabilitation services, reasonable accommodations, and other 
necessary support services, to assist the individual in engaging in 
competitive employment as defined in Sec. 361.5(b)(11).

(Authority: Sections 12(c) and 101(a)(14) of the Act; 29 U.S.C. 709(c) 
and 721(a)(14))

[66 FR 7253, Jan. 22, 2001]



Sec. 361.56  Requirements for closing the record of services of an 
individual who has achieved an employment outcome.

    The record of services of an individual who has achieved an 
employment outcome may be closed only if all of the following 
requirements are met:
    (a) Employment outcome achieved. The individual has achieved the 
employment outcome that is described in the individual's IPE in 
accordance with Sec. 361.46(a)(1) and is consistent with the 
individual's strengths, resources, priorities, concerns, abilities, 
capabilities, interests, and informed choice.
    (b) Employment outcome maintained. The individual has maintained the 
employment outcome for an appropriate period of time, but not less than 
90 days, necessary to ensure the stability of the employment outcome, 
and the individual no longer needs vocational rehabilitation services.
    (c) Satisfactory outcome. At the end of the appropriate period under 
paragraph (b) of this section, the individual and the qualified 
rehabilitation counselor employed by the designated State unit consider 
the employment outcome to be satisfactory and agree that the individual 
is performing well in the employment.
    (d) Post-employment services. The individual is informed through 
appropriate modes of communication of the availability of post-
employment services.

(Authority: Sections 12(c), 101(a)(6), and 106(a)(2) of the Act; 29 
U.S.C. 711(c), 721(a)(6), and 726(a)(2))

[66 FR 4382, Jan. 17, 2001, as amended at 66 FR 7253, Jan. 22, 2001]



Sec. 361.57  Review of determinations made by designated State unit 
personnel.

    (a) Procedures. The designated State unit must develop and implement 
procedures to ensure that an applicant or eligible individual who is 
dissatisfied with any determination made by personnel of the designated 
State unit that affects the provision of vocational rehabilitation 
services may request, or, if appropriate, may request through the 
individual's representative, a timely review of that determination. The 
procedures must be in accordance with

[[Page 296]]

paragraphs (b) through (k) of this section:
    (b) General requirements--(1) Notification. Procedures established 
by the State unit under this section must provide an applicant or 
eligible individual or, as appropriate, the individual's representative 
notice of--
    (i) The right to obtain review of State unit determinations that 
affect the provision of vocational rehabilitation services through an 
impartial due process hearing under paragraph (e) of this section;
    (ii) The right to pursue mediation under paragraph (d) of this 
section with respect to determinations made by designated State unit 
personnel that affect the provision of vocational rehabilitation 
services to an applicant or eligible individual;
    (iii) The names and addresses of individuals with whom requests for 
mediation or due process hearings may be filed;
    (iv) The manner in which a mediator or impartial hearing officer may 
be selected consistent with the requirements of paragraphs (d) and (f) 
of this section; and
    (v) The availability of the client assistance program, established 
under 34 CFR part 370, to assist the applicant or eligible individual 
during mediation sessions or impartial due process hearings.
    (2) Timing. Notice described in paragraph (b)(1) of this section 
must be provided in writing--
    (i) At the time the individual applies for vocational rehabilitation 
services under this part;
    (ii) At the time the individual is assigned to a category in the 
State's order of selection, if the State has established an order of 
selection under Sec. 361.36;
    (iii) At the time the IPE is developed; and
    (iv) Whenever vocational rehabilitation services for an individual 
are reduced, suspended, or terminated.
    (3) Evidence and representation. Procedures established under this 
section must--
    (i) Provide an applicant or eligible individual or, as appropriate, 
the individual's representative with an opportunity to submit during 
mediation sessions or due process hearings evidence and other 
information that supports the applicant's or eligible individual's 
position; and
    (ii) Allow an applicant or eligible individual to be represented 
during mediation sessions or due process hearings by counsel or other 
advocate selected by the applicant or eligible individual.
    (4) Impact on provision of services. The State unit may not 
institute a suspension, reduction, or termination of vocational 
rehabilitation services being provided to an applicant or eligible 
individual, including evaluation and assessment services and IPE 
development, pending a resolution through mediation, pending a decision 
by a hearing officer or reviewing official, or pending informal 
resolution under this section unless--
    (i) The individual or, in appropriate cases, the individual's 
representative requests a suspension, reduction, or termination of 
services; or
    (ii) The State agency has evidence that the services have been 
obtained through misrepresentation, fraud, collusion, or criminal 
conduct on the part of the individual or the individual's 
representative.
    (5) Ineligibility. Applicants who are found ineligible for 
vocational rehabilitation services and previously eligible individuals 
who are determined to be no longer eligible for vocational 
rehabilitation services pursuant to Sec. 361.43 are permitted to 
challenge the determinations of ineligibility under the procedures 
described in this section.
    (c) Informal dispute resolution. The State unit may develop an 
informal process for resolving a request for review without conducting 
mediation or a formal hearing. A State's informal process must not be 
used to deny the right of an applicant or eligible individual to a 
hearing under paragraph (e) of this section or any other right provided 
under this part, including the right to pursue mediation under paragraph 
(d) of this section. If informal resolution under this paragraph or 
mediation under paragraph (d) of this section is not successful in 
resolving the dispute within the time period established under paragraph 
(e)(1) of this section, a formal hearing must be conducted within that 
same time period,

[[Page 297]]

unless the parties agree to a specific extension of time.
    (d) Mediation. (1) The State must establish and implement 
procedures, as required under paragraph (b)(1)(ii) of this section, to 
allow an applicant or eligible individual and the State unit to resolve 
disputes involving State unit determinations that affect the provision 
of vocational rehabilitation services through a mediation process that 
must be made available, at a minimum, whenever an applicant or eligible 
individual or, as appropriate, the individual's representative requests 
an impartial due process hearing under this section.
    (2) Mediation procedures established by the State unit under 
paragraph (d) must ensure that--
    (i) Participation in the mediation process is voluntary on the part 
of the applicant or eligible individual, as appropriate, and on the part 
of the State unit;
    (ii) Use of the mediation process is not used to deny or delay the 
applicant's or eligible individual's right to pursue resolution of the 
dispute through an impartial hearing held within the time period 
specified in paragraph (e)(1) of this section or any other rights 
provided under this part. At any point during the mediation process, 
either party or the mediator may elect to terminate the mediation. In 
the event mediation is terminated, either party may pursue resolution 
through an impartial hearing;
    (iii) The mediation process is conducted by a qualified and 
impartial mediator, as defined in Sec. 361.5(b)(43), who must be 
selected from a list of qualified and impartial mediators maintained by 
the State--
    (A) On a random basis;
    (B) By agreement between the director of the designated State unit 
and the applicant or eligible individual or, as appropriate, the 
individual's representative; or
    (C) In accordance with a procedure established in the State for 
assigning mediators, provided this procedure ensures the neutrality of 
the mediator assigned; and
    (iv) Mediation sessions are scheduled and conducted in a timely 
manner and are held in a location and manner that is convenient to the 
parties to the dispute.
    (3) Discussions that occur during the mediation process must be kept 
confidential and may not be used as evidence in any subsequent due 
process hearings or civil proceedings, and the parties to the mediation 
process may be required to sign a confidentiality pledge prior to the 
commencement of the process.
    (4) An agreement reached by the parties to the dispute in the 
mediation process must be described in a written mediation agreement 
that is developed by the parties with the assistance of the qualified 
and impartial mediator and signed by both parties. Copies of the 
agreement must be sent to both parties.
    (5) The costs of the mediation process must be paid by the State. 
The State is not required to pay for any costs related to the 
representation of an applicant or eligible individual authorized under 
paragraph (b)(3)(ii) of this section.
    (e) Impartial due process hearings. The State unit must establish 
and implement formal review procedures, as required under paragraph 
(b)(1)(i) of this section, that provide that--
    (1) A hearing conducted by an impartial hearing officer, selected in 
accordance with paragraph (f) of this section, must be held within 60 
days of an applicant's or eligible individual's request for review of a 
determination made by personnel of the State unit that affects the 
provision of vocational rehabilitation services to the individual, 
unless informal resolution or a mediation agreement is achieved prior to 
the 60th day or the parties agree to a specific extension of time;
    (2) In addition to the rights described in paragraph (b)(3) of this 
section, the applicant or eligible individual or, if appropriate, the 
individual's representative must be given the opportunity to present 
witnesses during the hearing and to examine all witnesses and other 
relevant sources of information and evidence;
    (3) The impartial hearing officer must--
    (i) Make a decision based on the provisions of the approved State 
plan, the Act, Federal vocational rehabilitation

[[Page 298]]

regulations, and State regulations and policies that are consistent with 
Federal requirements; and
    (ii) Provide to the individual or, if appropriate, the individual's 
representative and to the State unit a full written report of the 
findings and grounds for the decision within 30 days of the completion 
of the hearing; and
    (4) The hearing officer's decision is final, except that a party may 
request an impartial review under paragraph (g)(1) of this section if 
the State has established procedures for that review, and a party 
involved in a hearing may bring a civil action under paragraph (i) of 
this section.
    (f) Selection of impartial hearing officers. The impartial hearing 
officer for a particular case must be selected--
    (1) From a list of qualified impartial hearing officers maintained 
by the State unit. Impartial hearing officers included on the list must 
be--
    (i) Identified by the State unit if the State unit is an independent 
commission; or
    (ii) Jointly identified by the State unit and the State 
Rehabilitation Council if the State has a Council; and
    (2)(i) On a random basis; or
    (ii) By agreement between the director of the designated State unit 
and the applicant or eligible individual or, as appropriate, the 
individual's representative.
    (g) Administrative review of hearing officer's decision. The State 
may establish procedures to enable a party who is dissatisfied with the 
decision of the impartial hearing officer to seek an impartial 
administrative review of the decision under paragraph (e)(3) of this 
section in accordance with the following requirements:
    (1) A request for administrative review under paragraph (g) of this 
section must be made within 20 days of the mailing of the impartial 
hearing officer's decision.
    (2) Administrative review of the hearing officer's decision must be 
conducted by--
    (i) The chief official of the designated State agency if the State 
has established both a designated State agency and a designated State 
unit under Sec. 361.13(b); or
    (ii) An official from the office of the Governor.
    (3) The reviewing official described in paragraph (g)(2)(i) of this 
section--
    (i) Provides both parties with an opportunity to submit additional 
evidence and information relevant to a final decision concerning the 
matter under review;
    (ii) May not overturn or modify the hearing officer's decision, or 
any part of that decision, that supports the position of the applicant 
or eligible individual unless the reviewing official concludes, based on 
clear and convincing evidence, that the decision of the impartial 
hearing officer is clearly erroneous on the basis of being contrary to 
the approved State plan, the Act, Federal vocational rehabilitation 
regulations, or State regulations and policies that are consistent with 
Federal requirements;
    (iii) Makes an independent, final decision following a review of the 
entire hearing record and provides the decision in writing, including a 
full report of the findings and the statutory, regulatory, or policy 
grounds for the decision, to the applicant or eligible individual or, as 
appropriate, the individual's representative and to the State unit 
within 30 days of the request for administrative review under paragraph 
(g)(1) of this section; and
    (iv) May not delegate the responsibility for making the final 
decision under paragraph (g) of this section to any officer or employee 
of the designated State unit.
    (4) The reviewing official's decision under paragraph (g) of this 
section is final unless either party brings a civil action under 
paragraph (i) of this section.
    (h) Implementation of final decisions. If a party brings a civil 
action under paragraph (h) of this section to challenge the final 
decision of a hearing officer under paragraph (e) of this section or to 
challenge the final decision of a State reviewing official under 
paragraph (g) of this section, the final decision of the hearing officer 
or State reviewing official must be implemented pending review by the 
court.
    (i) Civil action. (1) Any party who disagrees with the findings and 
decision of an impartial hearing officer under

[[Page 299]]

paragraph (e) of this section in a State that has not established 
administrative review procedures under paragraph (g) of this section and 
any party who disagrees with the findings and decision under paragraph 
(g)(3)(iii) of this section have a right to bring a civil action with 
respect to the matter in dispute. The action may be brought in any State 
court of competent jurisdiction or in a district court of the United 
States of competent jurisdiction without regard to the amount in 
controversy.
    (2) In any action brought under paragraph (i) of this section, the 
court--
    (i) Receives the records related to the impartial due process 
hearing and the records related to the administrative review process, if 
applicable;
    (ii) Hears additional evidence at the request of a party; and
    (iii) Basing its decision on the preponderance of the evidence, 
grants the relief that the court determines to be appropriate.
    (j) State fair hearing board. A fair hearing board as defined in 
Sec. 361.5(b)(22) is authorized to carry out the responsibilities of 
the impartial hearing officer under paragraph (e) of this section in 
accordance with the following criteria:
    (1) The fair hearing board may conduct due process hearings either 
collectively or by assigning responsibility for conducting the hearing 
to one or more members of the fair hearing board.
    (2) The final decision issued by the fair hearing board following a 
hearing under paragraph (j)(1) of this section must be made collectively 
by, or by a majority vote of, the fair hearing board.
    (3) The provisions of paragraphs (b)(1), (2), and (3) of this 
section that relate to due process hearings and of paragraphs (e), (f), 
(g), and (h) of this section do not apply to fair hearing boards under 
this paragraph (j).
    (k) Data collection.
    (1) The director of the designated State unit must collect and 
submit, at a minimum, the following data to the Commissioner of the 
Rehabilitation Services Administration (RSA) for inclusion each year in 
the annual report to Congress under section 13 of the Act:
    (i) A copy of the standards used by State reviewing officials for 
reviewing decisions made by impartial hearing officers under this 
section.
    (ii) The number of mediations held, including the number of 
mediation agreements reached.
    (iii) The number of hearings and reviews sought from impartial 
hearing officers and State reviewing officials, including the type of 
complaints and the issues involved.
    (iv) The number of hearing officer decisions that were not reviewed 
by administrative reviewing officials.
    (v) The number of hearing decisions that were reviewed by State 
reviewing officials and, based on these reviews, the number of hearing 
decisions that were--
    (A) Sustained in favor of an applicant or eligible individual;
    (B) Sustained in favor of the designated State unit;
    (C) Reversed in whole or in part in favor of the applicant or 
eligible individual; and
    (D) Reversed in whole or in part in favor of the State unit.
    (2) The State unit director also must collect and submit to the 
Commissioner of RSA copies of all final decisions issued by impartial 
hearing officers under paragraph (e) of this section and by State review 
officials under paragraph (g) of this section.
    (3) The confidentiality of records of applicants and eligible 
individuals maintained by the State unit may not preclude the access of 
the RSA Commissioner to those records for the purposes described in this 
section.

(Approved by the Office of Management and Budget under control number 
1820-0500)

(Authority: Section 102(c) of the Act; 29 U.S.C. 722(c))

[66 FR 4382, Jan. 17, 2001, as amended at 66 FR 7253, Jan. 22, 2001]



     Subpart C_Financing of State Vocational Rehabilitation Programs



Sec. 361.60  Matching requirements.

    (a) Federal share--(1) General. Except as provided in paragraph 
(a)(2) of this section, the Federal share for expenditures made by the 
State under the

[[Page 300]]

State plan, including expenditures for the provision of vocational 
rehabilitation services and the administration of the State plan, is 
78.7 percent.
    (2) Construction projects. The Federal share for expenditures made 
for the construction of a facility for community rehabilitation program 
purposes may not be more than 50 percent of the total cost of the 
project.
    (b) Non-Federal share--(1) General. Except as provided in paragraph 
(b)(2) and (3) of this section, expenditures made under the State plan 
to meet the non-Federal share under this section must be consistent with 
the provisions of 34 CFR 80.24.
    (2) Third party in-kind contributions. Third party in-kind 
contributions specified in 34 CFR 80.24(a)(2) may not be used to meet 
the non-Federal share under this section.
    (3) Contributions by private entities. Expenditures made from 
contributions by private organizations, agencies, or individuals that 
are deposited in the account of the State agency or sole local agency in 
accordance with State law and that are earmarked, under a condition 
imposed by the contributor, may be used as part of the non-Federal share 
under this section if the funds are earmarked for--
    (i) Meeting in whole or in part the State's share for establishing a 
community rehabilitation program or constructing a particular facility 
for community rehabilitation program purposes;
    (ii) Particular geographic areas within the State for any purpose 
under the State plan, other than those described in paragraph (b)(3)(i) 
of this section, in accordance with the following criteria:
    (A) Before funds that are earmarked for a particular geographic area 
may be used as part of the non-Federal share, the State must notify the 
Secretary that the State cannot provide the full non-Federal share 
without using these funds.
    (B) Funds that are earmarked for a particular geographic area may be 
used as part of the non-Federal share without requesting a waiver of 
statewideness under Sec. 361.26.
    (C) Except as provided in paragraph (b)(3)(i) of this section, all 
Federal funds must be used on a statewide basis consistent with Sec. 
361.25, unless a waiver of statewideness is obtained under Sec. 361.26; 
and
    (iii) Any other purpose under the State plan, provided the 
expenditures do not benefit in any way the donor, an individual to whom 
the donor is related by blood or marriage or with whom the donor has a 
close personal relationship, or an individual, entity, or organization 
with whom the donor shares a financial interest. The Secretary does not 
consider a donor's receipt from the State unit of a grant, subgrant, or 
contract with funds allotted under this part to be a benefit for the 
purposes of this paragraph if the grant, subgrant, or contract is 
awarded under the State's regular competitive procedures.


(Authority: Sections 7(14), 101(a)(3), 101(a)(4) and 104 of the Act; 29 
U.S.C. 706(14), 721(a)(3), 721(a)(4) and 724))

    Example for paragraph (b)(3): Contributions may be earmarked in 
accordance with Sec. 361.60(b)(3)(iii) for providing particular 
services (e.g., rehabilitation technology services); serving individuals 
with certain types of disabilities (e.g., individuals who are blind), 
consistent with the State's order of selection, if applicable; providing 
services to special groups that State or Federal law permits to be 
targeted for services (e.g., students with disabilities who are 
receiving special education services), consistent with the State's order 
of selection, if applicable; or carrying out particular types of 
administrative activities permissible under State law. Contributions 
also may be restricted to particular geographic areas to increase 
services or expand the scope of services that are available statewide 
under the State plan in accordance with the requirements in Sec. 
361.60(b)(3)(ii).

(Approved by the Office of Management and Budget under control number 
1820-0500)

[66 FR 4382, Jan. 17, 2001, as amended at 66 FR 7253, Jan. 22, 2001]



Sec. 361.61  Limitation on use of funds for construction expenditures.

    No more than 10 percent of a State's allotment for any fiscal year 
under section 110 of the Act may be spent on the construction of 
facilities for community rehabilitation program purposes.

(Authority: Section 101(a)(17)(A) of the Act; 29 U.S.C. 721(a)(17)(A))

[[Page 301]]



Sec. 361.62  Maintenance of effort requirements.

    (a) General requirements. (1) The Secretary reduces the amount 
otherwise payable to a State for a fiscal year by the amount by which 
the total expenditures from non-Federal sources under the State plan for 
the previous fiscal year were less than the total of those expenditures 
for the fiscal year 2 years prior to the previous fiscal year.

    Example: For fiscal year 2001, a State's maintenance of effort level 
is based on the amount of its expenditures from non-Federal sources for 
fiscal year 1999. Thus, if the State's non-Federal expenditures in 2001 
are less than they were in 1999, the State has a maintenance of effort 
deficit, and the Secretary reduces the State's allotment in 2002 by the 
amount of that deficit.

    (2) If, at the time the Secretary makes a determination that a State 
has failed to meet its maintenance of effort requirements, it is too 
late for the Secretary to make a reduction in accordance with paragraph 
(a)(1) of this section, then the Secretary recovers the amount of the 
maintenance of effort deficit through audit disallowance.
    (b) Specific requirements for construction of facilities. If the 
State provides for the construction of a facility for community 
rehabilitation program purposes, the amount of the State's share of 
expenditures for vocational rehabilitation services under the plan, 
other than for the construction of a facility for community 
rehabilitation program purposes or the establishment of a facility for 
community rehabilitation purposes, must be at least equal to the 
expenditures for those services for the second prior fiscal year. If a 
State fails to meet the requirements of this paragraph, the Secretary 
recovers the amount of the maintenance of effort deficit through audit 
disallowance.
    (c) Separate State agency for vocational rehabilitation services for 
individuals who are blind. If there is a separate part of the State plan 
administered by a separate State agency to provide vocational 
rehabilitation services for individuals who are blind--
    (1) Satisfaction of the maintenance of effort requirements under 
paragraphs (a) and (b) of this section are determined based on the total 
amount of a State's non-Federal expenditures under both parts of the 
State plan; and
    (2) If a State fails to meet any maintenance of effort requirement, 
the Secretary reduces the amount otherwise payable to the State for that 
fiscal year under each part of the plan in direct relation to the amount 
by which expenditures from non-Federal sources under each part of the 
plan in the previous fiscal year were less than they were for that part 
of the plan for the fiscal year 2 years prior to the previous fiscal 
year.
    (d) Waiver or modification. (1) The Secretary may waive or modify 
the maintenance of effort requirement in paragraph (a)(1) of this 
section if the Secretary determines that a waiver or modification is 
necessary to permit the State to respond to exceptional or 
uncontrollable circumstances, such as a major natural disaster or a 
serious economic downturn, that--
    (i) Cause significant unanticipated expenditures or reductions in 
revenue that result in a general reduction of programs within the State; 
or
    (ii) Require the State to make substantial expenditures in the 
vocational rehabilitation program for long-term purposes due to the one-
time costs associated with the construction of a facility for community 
rehabilitation program purposes, the establishment of a facility for 
community rehabilitation program purposes, or the acquisition of 
equipment.
    (2) The Secretary may waive or modify the maintenance of effort 
requirement in paragraph (b) of this section or the 10 percent allotment 
limitation in Sec. 361.61 if the Secretary determines that a waiver or 
modification is necessary to permit the State to respond to exceptional 
or uncontrollable circumstances, such as a major natural disaster, that 
result in significant destruction of existing facilities and require the 
State to make substantial expenditures for the construction of a 
facility for community rehabilitation program purposes or the 
establishment of a facility for community rehabilitation program 
purposes in order to provide vocational rehabilitation services.
    (3) A written request for waiver or modification, including 
supporting justification, must be submitted to the

[[Page 302]]

Secretary as soon as the State determines that an exceptional or 
uncontrollable circumstance will prevent it from making its required 
expenditures from non-Federal sources.

(Approved by the Office of Management and Budget under control number 
1820-0500)

(Authority: Sections 101(a)(17) and 111(a)(2) of the Act; 29 U.S.C. 
721(a)(17) and 731(a)(2))

[66 FR 4382, Jan. 17, 2001, as amended at 66 FR 7253, Jan. 22, 2001]



Sec. 361.63  Program income.

    (a) Definition. For purposes of this section, program income means 
gross income received by the State that is directly generated by an 
activity supported under this part.
    (b) Sources. Sources of program income include, but are not limited 
to, payments from the Social Security Administration for assisting 
Social Security beneficiaries and recipients to achieve employment 
outcomes, payments received from workers' compensation funds, fees for 
services to defray part or all of the costs of services provided to 
particular individuals, and income generated by a State-operated 
community rehabilitation program.
    (c) Use of program income. (1) Except as provided in paragraph 
(c)(2) of this section, program income, whenever earned, must be used 
for the provision of vocational rehabilitation services and the 
administration of the State plan. Program income is considered earned 
when it is received.
    (2) Payments provided to a State from the Social Security 
Administration for assisting Social Security beneficiaries and 
recipients to achieve employment outcomes may also be used to carry out 
programs under part B of Title I of the Act (client assistance), part B 
of Title VI of the Act (supported employment), and Title VII of the Act 
(independent living).
    (3) The State is authorized to treat program income as--
    (i) An addition to the grant funds to be used for additional 
allowable program expenditures, in accordance with 34 CFR 80.25(g)(2); 
or
    (ii) A deduction from total allowable costs, in accordance with 34 
CFR 80.25(g)(1).
    (4) Program income cannot be used to meet the non-Federal share 
requirement under Sec. 361.60.

(Authority: Section 108 of the Act; 29 U.S.C. 728; 34 CFR 80.25)



Sec. 361.64  Obligation of Federal funds and program income.

    (a) Except as provided in paragraph (b) of this section, any Federal 
funds, including reallotted funds, that are appropriated for a fiscal 
year to carry out a program under this part that are not obligated by 
the State by the beginning of the succeeding fiscal year and any program 
income received during a fiscal year that is not obligated by the State 
by the beginning of the succeeding fiscal year remain available for 
obligation by the State during that succeeding fiscal year.
    (b) Federal funds appropriated for a fiscal year remain available 
for obligation in the succeeding fiscal year only to the extent that the 
State met the matching requirement for those Federal funds by 
obligating, in accordance with 34 CFR 76.707, the non-Federal share in 
the fiscal year for which the funds were appropriated.

(Authority: Section 19 of the Act; 29 U.S.C. 716)



Sec. 361.65  Allotment and payment of Federal funds for vocational 
rehabilitation services.

    (a) Allotment.
    (1) The allotment of Federal funds for vocational rehabilitation 
services for each State is computed in accordance with the requirements 
of section 110 of the Act, and payments are made to the State on a 
quarterly basis, unless some other period is established by the 
Secretary.
    (2) If the State plan designates one State agency to administer, or 
supervise the administration of, the part of the plan under which 
vocational rehabilitation services are provided for individuals who are 
blind and another State agency to administer the rest of the plan, the 
division of the State's allotment is a matter for State determination.
    (b) Reallotment. (1) The Secretary determines not later than 45 days 
before the end of a fiscal year which States, if any, will not use their 
full allotment.

[[Page 303]]

    (2) As soon as possible, but not later than the end of the fiscal 
year, the Secretary reallots these funds to other States that can use 
those additional funds during the current or subsequent fiscal year, 
provided the State can meet the matching requirement by obligating the 
non-Federal share of any reallotted funds in the fiscal year for which 
the funds were appropriated.
    (3) Funds reallotted to another State are considered to be an 
increase in the recipient State's allotment for the fiscal year for 
which the funds were appropriated.

(Authority: Sections 110 and 111 of the Act; 29 U.S.C. 730 and 731)

Subpart D [Reserved]



        Subpart E_Evaluation Standards and Performance Indicators



Sec. 361.80  Purpose.

    The purpose of this subpart is to establish evaluation standards and 
performance indicators for the Program.

(Authority: 29 U.S.C. 726(a))



Sec. 361.81  Applicable definitions.

    In addition to those definitions in Sec. 361.5(b), the following 
definitions apply to this subpart:
    Average hourly earnings means the average per hour earnings in the 
week prior to exiting the vocational rehabilitation (VR) program of an 
eligible individual who has achieved a competitive employment outcome.
    Business Enterprise Program (BEP) means an employment outcome in 
which an individual with a significant disability operates a vending 
facility or other small business under the management and supervision of 
a designated State unit (DSU). This term includes home industry, 
farming, and other enterprises.
    Exit the VR program means that a DSU has closed the individual's 
record of VR services in one of the following categories:
    (1) Ineligible for VR services.
    (2) Received services under an individualized plan for employment 
(IPE) and achieved an employment outcome.
    (3) Received services under an IPE but did not achieve an employment 
outcome.
    (4) Eligible for VR services but did not receive services under an 
IPE.
    General or combined DSU means a DSU that does not serve exclusively 
individuals with visual impairments or blindness.
    Individuals from a minority background means individuals who report 
their race and ethnicity in any of the following categories: American 
Indian or Alaska Native, Asian, Black or African American, Native 
Hawaiian or Other Pacific Islander, or Hispanic or Latino.
    Minimum wage means the higher of the rate specified in section 
6(a)(1) of the Fair Labor Standards Act of 1938, 29 U.S.C. 206(a)(1), 
(i.e., the Federal minimum wage) or applicable State minimum wage law.
    Non-minority individuals means individuals who report themselves 
exclusively as White, non-Hispanic.
    Performance period is the reporting period during which a DSU's 
performance is measured. For Evaluation Standards 1 and 2, performance 
data must be aggregated and reported for each fiscal year beginning with 
fiscal year 1999. However, DSUs that exclusively serve individuals with 
visual impairments or blindness must report each year the aggregated 
data for the 2 previous years for Performance Indicators 1.1 through 
1.6; the second year must coincide with the performance period for 
general or combined DSUs.
    Primary indicators means Performance Indicators 1.3, 1.4, and 1.5, 
which are specifically designed to measure--
    (1) The achievement of competitive, self-, or BEP employment with 
earnings equivalent to the minimum wage or higher, particularly by 
individuals with significant disabilities; and
    (2) The ratio between the average hourly earnings of individuals who 
exit the VR program in competitive, self-, or BEP employment with 
earnings equivalent to the minimum wage or higher and the State's 
average hourly earnings for all employed individuals.
    RSA-911 means the Case Service Report that is submitted annually by 
a DSU as approved by the Office of Management and Budget (OMB).

[[Page 304]]

    Self-employment means an employment outcome in which the individual 
works for profit or fee in his or her own business, farm, shop, or 
office, including sharecroppers.
    Service rate means the result obtained by dividing the number of 
individuals who exit the VR program after receiving one or more services 
under an IPE during any reporting period by the total number of 
individuals who exit the VR program (as defined in this section) during 
that reporting period.
    State's average hourly earnings means the average hourly earnings of 
all persons in the State in which the DSU is located.

(Authority: 29 U.S.C. 726(a))



Sec. 361.82  Evaluation standards.

    (a) The Secretary establishes two evaluation standards to evaluate 
the performance of each DSU that receives funds under this part. The 
evaluation standards assist the Secretary and each DSU to evaluate a 
DSU's performance in serving individuals with disabilities under the VR 
program.
    (b) A DSU must achieve successful performance on both evaluation 
standards during each performance period.
    (c) The evaluation standards for the VR program are--
    (1) Evaluation Standard 1--Employment outcomes. A DSU must assist 
any eligible individual, including an individual with a significant 
disability, to obtain, maintain, or regain high-quality employment.
    (2) Evaluation Standard 2--Equal access to services. A DSU must 
ensure that individuals from minority backgrounds have equal access to 
VR services.

(Approved by the Office of Management and Budget under control number 
1820-0508)

(Authority: 29 U.S.C. 726(a))



Sec. 361.84  Performance indicators.

    (a) The performance indicators establish what constitutes minimum 
compliance with the evaluation standards.
    (b) The performance indicators require a DSU to provide information 
on a variety of factors to enable the Secretary to measure compliance 
with the evaluation standards.
    (c) The performance indicators are as follows:
    (1) Employment outcomes.
    (i) Performance Indicator 1.1. The number of individuals exiting the 
VR program who achieved an employment outcome during the current 
performance period compared to the number of individuals who exit the VR 
program after achieving an employment outcome during the previous 
performance period.
    (ii) Performance Indicator 1.2. Of all individuals who exit the VR 
program after receiving services, the percentage who are determined to 
have achieved an employment outcome.
    (iii) Performance Indicator 1.3. Of all individuals determined to 
have achieved an employment outcome, the percentage who exit the VR 
program in competitive, self-, or BEP employment with earnings 
equivalent to at least the minimum wage.
    (iv) Performance Indicator 1.4. Of all individuals who exit the VR 
program in competitive, self-, or BEP employment with earnings 
equivalent to at least the minimum wage, the percentage who are 
individuals with significant disabilities.
    (v) Performance Indicator 1.5. The average hourly earnings of all 
individuals who exit the VR program in competitive, self-, or BEP 
employment with earnings levels equivalent to at least the minimum wage 
as a ratio to the State's average hourly earnings for all individuals in 
the State who are employed (as derived from the Bureau of Labor 
Statistics report ``State Average Annual Pay'' for the most recent 
available year).
    (vi) Performance Indicator 1.6. Of all individuals who exit the VR 
program in competitive, self-, or BEP employment with earnings 
equivalent to at least the minimum wage, the difference between the 
percentage who report their own income as the largest single source of 
economic support at the time they exit the VR program and the percentage 
who report their own income as the largest single source of support at 
the time they apply for VR services.
    (2) Equal access to services.
    (i) Performance Indicator 2.1. The service rate for all individuals 
with disabilities from minority backgrounds as a

[[Page 305]]

ratio to the service rate for all non-minority individuals with 
disabilities.

(Approved by the Office of Management and Budget under control number 
1820-0508)

(Authority: 29 U.S.C. 726(a))



Sec. 361.86  Performance levels.

    (a) General.
    (1) Paragraph (b) of this section establishes performance levels 
for--
    (i) General or combined DSUs; and
    (ii) DSUs serving exclusively individuals who are visually impaired 
or blind.
    (2) The Secretary may establish, by regulations, new performance 
levels.
    (b) Performance levels for each performance indicator.
    (1)(i) The performance levels for Performance Indicators 1.1 through 
1.6 are--

------------------------------------------------------------------------
                                     Performance level by type of DSU
     Performance indicator      ----------------------------------------
                                   General/Combined          Blind
------------------------------------------------------------------------
1.1............................  Equal or exceed      Same.
                                  previous
                                  performance period.
1.2............................  55.8%..............  68.9%.
1.3............................  72.6%..............  35.4%.
1.4............................  62.4%..............  89.0%.
1.5............................  .52 (Ratio)........  .59.
1.6............................  53.0 (Math.          30.4.
                                  Difference).
------------------------------------------------------------------------

    (ii) To achieve successful performance on Evaluation Standard 1 
(Employment outcomes), a DSU must meet or exceed the performance levels 
established for four of the six performance indicators in the evaluation 
standard, including meeting or exceeding the performance levels for two 
of the three primary indicators (Performance Indicators 1.3, 1.4, and 
1.5).
    (2)(i) The performance level for Performance Indicator 2.1 is--

------------------------------------------------------------------------
         Performance indicator                  Performance levels
------------------------------------------------------------------------
2.1....................................  .80 (Ratio).
------------------------------------------------------------------------

    (ii) To achieve successful performance on Evaluation Standard 2 
(Equal access), DSUs must meet or exceed the performance level 
established for Performance Indicator 2.1 or meet the performance 
requirement in paragraph (2)(iii) of this section.
    (iii) If a DSU's performance does not meet or exceed the performance 
level required for Performance Indicator 2.1, or if fewer than 100 
individuals from a minority population have exited the VR program during 
the reporting period, the DSU must describe the policies it has adopted 
or will adopt and the steps it has taken or will take to ensure that 
individuals with disabilities from minority backgrounds have equal 
access to VR services.

(Authority: 29 U.S.C. 726(a))



Sec. 361.88  Reporting requirements.

    (a) The Secretary requires that each DSU report within 60 days after 
the end of each fiscal year the extent to which the State is in 
compliance with the evaluation standards and performance indicators and 
include in this report the following RSA-911 data:
    (1) The number of individuals who exited the VR program in each 
closure category as specified in the definition of ``Exit the VR 
program'' under Sec. 361.81.
    (2) The number of individuals who exited the VR program in 
competitive, self-, or BEP employment with earnings at or above the 
minimum wage.
    (3) The number of individuals with significant disabilities who 
exited the VR program in competitive, self-, or BEP employment with 
earnings at or above the minimum wage.
    (4) The weekly earnings and hours worked of individuals who exited 
the VR program in competitive, self-, or BEP employment with earnings at 
or above the minimum wage.
    (5) The number of individuals who exited the VR program in 
competitive, self-, or BEP employment with earnings at or above the 
minimum wage whose primary source of support at the time they applied 
for VR services was ``personal income.''
    (6) The number of individuals who exited the VR program in 
competitive, self-, or BEP employment with earnings at or above the 
minimum wage whose primary source of support at closure was ``personal 
income.''
    (7) The number of individuals exiting the VR program who are 
individuals from a minority background.
    (8) The number of non-minority individuals exiting the VR program.
    (9) The number of individuals from a minority background exiting the 
VR program after receiving services under an IPE.

[[Page 306]]

    (10) The number of non-minority individuals exiting the VR program 
after receiving services under an IPE.
    (b) In lieu of the report required in paragraph (a) of this section, 
a DSU may submit its RSA-911 data on tape, diskette, or any alternative 
electronic format that is compatible with RSA's capability to process 
such an alternative, as long as the tape, diskette, or alternative 
electronic format includes the data that--
    (1) Are required by paragraph (a)(1) through (10) of this section; 
and
    (2) Meet the requirements of paragraph (c) of this section.
    (c) Data reported by a DSU must be valid, accurate, and in a 
consistent format. If a DSU fails to submit data that are valid, 
accurate, and in a consistent format within the 60-day period, the DSU 
must develop a program improvement plan pursuant to Sec. 361.89(a).

(Approved by the Office of Management and Budget under control number 
1820-0508)

(Authority: 29 U.S.C. 726(b))



Sec. 361.89  Enforcement procedures.

    (a) If a DSU fails to meet the established performance levels on 
both evaluation standards as required by Sec. 361.82(b), the Secretary 
and the DSU must jointly develop a program improvement plan that 
outlines the specific actions to be taken by the DSU to improve program 
performance.
    (b) In developing the program improvement plan, the Secretary 
considers all available data and information related to the DSU's 
performance.
    (c) When a program improvement plan is in effect, review of the plan 
is conducted on a biannual basis. If necessary, the Secretary may 
request that a DSU make further revisions to the plan to improve 
performance. If the Secretary establishes new performance levels under 
Sec. 361.86(a)(2), the Secretary and the DSU must jointly modify the 
program improvement plan based on the new performance levels. The 
Secretary continues reviews and requests revisions until the DSU 
sustains satisfactory performance based on the current performance 
levels over a period of more than 1 year.
    (d) If the Secretary determines that a DSU with less than 
satisfactory performance has failed to enter into a program improvement 
plan or comply substantially with the terms and conditions of the 
program improvement plan, the Secretary, consistent with the procedures 
specified in Sec. 361.11, reduces or makes no further payments to the 
DSU under this program until the DSU has met one of these two 
requirements or raised its subsequent performance to meet the current 
overall minimum satisfactory level on the compliance indicators.

(Approved by the Office of Management and Budget under control number 
1820-0508)

(Authority: 29 U.S.C. 726(b) and (c))

              Appendix A to Part 361--Questions and Answers

    The following questions and answers provide a summary of some of the 
most common and critical questions that we received regarding this part 
361 and the applicable responses. As is evident from the responses, we 
maintain that redefining the term ``employment outcome'' for purposes of 
the VR program to mean outcomes that occur in integrated settings will 
promote the provision of opportunities for all VR-eligible individuals 
to pursue the types of jobs that generally are available to the public.

      Is Extended Employment Still a Legitimate Employment Option?

    Yes. Employment in a sheltered setting is a legitimate and valuable 
employment option for individuals with disabilities. Implementation of 
these regulations will not change that fact. Individuals still may 
choose to pursue long-term extended employment outside of the VR 
program, and these regulations ensure that those individuals' needs are 
met by requiring the VR agency to make the necessary referral to local 
extended employment providers.

             Do the Regulations Restrict Individual Choice?

    No. We interpret the concept of individual choice in the Act as a 
choice among the employment outcomes under the VR program specified in 
the statute or by the Secretary in regulations.
    Extended employment (i.e., sheltered or non-integrated employment) 
remains both an initial step toward achieving integrated employment 
under the VR program and a long-term employment option through sources 
of support other than the VR program. In recognizing that some 
individuals with disabilities may wish to work in an extended employment 
setting, these regulations require the VR agency to ensure that

[[Page 307]]

these individuals are afforded the opportunity to do so by referring 
them to local extended employment providers. Those providers currently 
support the vast majority of sheltered workers through non-VR program 
resources. Moreover, persons wishing to prepare for integrated 
employment by initially working in an extended employment setting also 
may do so. In these cases, the VR agency cannot discontinue VR services 
until the individual transitions to integrated work in the community.

   Can State Agencies Refuse To Serve Those With the Most Significant 
                              Disabilities?

    No. Both the Act and regulations guard against that result. Persons 
with disabilities may not be excluded from the VR program based on an 
assumption or belief that the individual is incapable of working in an 
integrated setting. Rather, State units are required to establish clear 
and convincing evidence that an individual is incapable of achieving an 
employment outcome, for purposes of the VR program, and must conduct a 
trial work assessment of the individual's abilities before it can refuse 
services to any individual who it initially believes is incapable of 
working in an intergrated job setting.

 Are Homemaker and Unpaid Family Worker Considered Employment Outcomes 
                     for Purposes of the VR Program?

    Yes. The chief purpose of the regulations is to ensure that 
individuals with disabilities participating in the VR program are able 
to pursue the same type of employment opportunities that are available 
to the general public. Extended employment jobs, unlike homemakers and 
unpaid family workers, are primarily reserved for those with 
disabilities.

      Will the Regulations Serve To Close Down Sheltered Workshops?

    No. Sheltered workshops are primarily supported by other State, 
local, and private resources and rely very little on VR program funds. 
Persons who prefer to work in extended employment on a long-term basis 
are assured access to local extended employment programs through the 
referral requirements in the regulations. Also, those participants in 
the VR program who can best prepare f