[Federal Register Volume 79, Number 157 (Thursday, August 14, 2014)]
[Rules and Regulations]
[Pages 47575-47579]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2014-19289]
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DEPARTMENT OF EDUCATION
34 CFR Chapter III
[CFDA Number: 84.224D.]
Final Priority; Rehabilitation Services Administration--Assistive
Technology Alternative Financing Program
AGENCY: Office of Special Education and Rehabilitative Services,
Department of Education.
ACTION: Final priority.
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SUMMARY: The Assistant Secretary for Special Education and
Rehabilitative Services announces a priority under the Assistive
Technology Alternative Financing Program administered by the
Rehabilitation Services Administration (RSA). The Assistant Secretary
may use this priority for competitions in fiscal year (FY) 2014 and
later years. This priority is designed to ensure that the Department
funds high-quality assistive technology (AT) alternative financing
programs (AFPs) that meet rigorous standards in order to enable
individuals with disabilities to access and acquire assistive
technology devices and services necessary to achieve education,
community living, and employment goals.
[[Page 47576]]
DATES: Effective Date: This priority is effective September 15, 2014.
FOR FURTHER INFORMATION CONTACT: Robert Groenendaal, U.S. Department of
Education, 400 Maryland Avenue SW., Room 5025, Potomac Center Plaza
(PCP), Washington, DC 20202-2800. Telephone: (202) 245-7393 or by
email: [email protected].
If you use a telecommunications device for the deaf (TDD) or a text
telephone (TTY), call the Federal Relay Service (FRS), toll free, at 1-
800-877-8339.
SUPPLEMENTARY INFORMATION:
Purpose of Program: The purpose of the Assistive Technology
Alternative Financing Program (AFP) is to support programs that provide
for the purchase of AT devices, such as a low-interest loan fund, an
interest buy-down program, a revolving loan fund, a loan guarantee, or
an insurance program. The Consolidated Appropriations Act, 2014 (the
Act) requires applicants for these grants to provide an assurance that,
and information describing the manner in which, the AFP will expand and
emphasize consumer choice and control. It also specifies that State
agencies and community-based disability organizations that are directed
by and operated for individuals with disabilities are eligible to
compete. Language in the Explanatory Statement accompanying the Act
provides that successful applicants must emphasize consumer choice and
control and build programs that will provide financing for the full
array of AT devices and services and ensure that all people with
disabilities, regardless of type of disability or health condition,
age, level of income, and residence, have access to the program. In
addition, the language provides that applicants should incorporate
credit-building activities in their programs, including financial
education and information about other possible funding sources.
Program Authority: Consolidated Appropriations Act, 2014 (Pub.
L. 113-76).
We published a notice of proposed priority for this competition in
the Federal Register on May 13, 2014 (79 FR 27230). That notice
contained background information and our reasons for proposing this
particular priority.
Except for minor editorial and technical revisions, there are no
differences between the proposed priority and this final priority.
Public Comment: In response to our invitation in the notice of
proposed priority, 16 parties submitted comments on the proposed
priority. Generally, we do not address technical or other minor
changes.
Analysis of Comments and Changes: An analysis of the comments and
of any changes in the priority since publication of the notice of
proposed priority follows.
Comment: Two commenters suggested that there should be a provision
for a multi-State consortium to apply. One commenter, however,
expressed opposition to multi-State consortia AT loan programs because
of a concern that these consortia would duplicate State programs. This
commenter proposed that AFPs should have knowledge of State-specific AT
resources.
Discussion: There is nothing in the priority or regulations that
prevents a multi-State consortium from applying. Under 34 CFR 75.127,
eligible parties may apply as a group for a grant; and ``consortium''
is a term that may be used to refer to a group of eligible parties. We
will clarify in the notice inviting applications for this competition
that multi-State groups or consortia are eligible to apply.
We agree with the commenter that grantees should be knowledgeable
about State-specific AT resources, and believe that the applicable
selection criteria address this concern. Specifically, among the
selection criteria in 34 CFR 75.210(a) that the Secretary may consider
when determining the need for a proposed project is the magnitude of
the need for the services to be provided or the activities to be
carried out and the extent to which specific gaps or weaknesses in
services, infrastructure, or opportunities have been identified and
will be addressed by the proposed project, including the nature and
magnitude of those gaps or weaknesses. We will use the peer review
process to determine how well an applicant addresses the needs of the
service area identified in the application.
Changes: None.
Comment: Seven commenters expressed opposition to the competitive
preference points. On the other hand, three commenters supported the
proposed competitive preference priorities, citing the need for AFPs in
every State. One commenter suggested that priority points be awarded to
existing AFPs with a history of successful operation.
Discussion: Twenty of the States and outlying areas have not
received funding for AT AFPs. While all States and outlying areas can
apply, our objective is to establish AFPs in States that have not
previously received funding from the Federal government for this
purpose and to expand small or underfunded AFPs that have received less
than $1 million from competitions under title III of the Assistive
Technology Act of 1998 (AT Act of 1998) during FYs 2000 through 2006,
or under the Appropriations Acts for FY 2012 and 2013. By awarding
competitive preference points to applicants, we intend to address the
need for the development of AFPs from these unserved or underfunded
areas so individuals with disabilities across the nation have the
opportunity to receive services and purchase AT devices through
alternative loan programs.
Changes: None.
Comment: Two commenters suggested that consumers be entitled to
exercise choice and control with respect to the makeup of the board of
directors of grantees; and that the boards should include a majority of
members with disabilities. One of these commenters questioned whether
family members should be counted toward this majority.
Discussion: The Act and the priority require that grantees
emphasize and expand consumer choice and control, including oversight
of the program. Although we encourage grantees to include individuals
with disabilities and their family members on their boards of
directors, the requirement in the Act does not specifically apply to
the composition of the grantees' boards. It applies to the involvement
of consumers in the implementation of a program's administration and
policy decisions. This could be achieved in a number of ways, including
having a majority of the members of the project's board of directors or
loan review committee be individuals with disabilities. In addition,
consumer choice and control applies to consumers who are receiving
financial loans having choices and control over the selection of
devices and vendors.
Each applicant is required to submit an assurance that, and
information describing the manner in which, the AFP will expand and
emphasize consumer choice and control. As AFPs must be designed to
allow individuals with disabilities and their family members,
guardians, advocates, and authorized representatives to purchase AT
devices or services, the consumer choice and control requirement
applies to family members of individuals with disabilities. As such, a
family member could serve on a board of directors or loan review
committee. We will use the competitive process to determine the extent
to which an application proposes to achieve consumer choice and
control.
Changes: None.
Comment: One commenter supported credit-building activities as an
important component of AFPs. This commenter proposed that grantees be
required to provide financial education
[[Page 47577]]
and counseling to consumers to improve their financial capability,
knowledge, and skills and advance their economic stability.
Discussion: The final priority requires applicants to submit an
assurance that the AFP will incorporate credit-building activities into
their programs, including financial education and information about
other possible funding sources. We will use the competitive process to
determine the extent to which an applicant proposes to meet this
requirement.
Changes: None.
Comment: One commenter recommended that the Department consider a
State's size, population, number of people with disabilities, and other
unique qualities in evaluating a grant application.
Discussion: Our objectives are to establish AFPs in States and
outlying areas that have not previously received funding from the
Federal government for this purpose and to expand small or underfunded
AFPs that have received less than $1 million from competitions under
title III of the AT Act of 1998 during FYs 2000 through 2006 or under
the Appropriations Acts for FYs 2012 and 2013. However, we note that
the ``Need for Project'' selection criterion in 34 CFR 75.210(a)
includes ``the magnitude of the need for the services to be provided or
the activities to be carried out by the proposed project'' and the
``extent to which specific gaps or weaknesses in services,
infrastructure, or opportunities have been identified and will be
addressed by the proposed project.'' We believe that this selection
criterion addresses the commenter's suggestion that we consider a
State's size, population, number of people with disabilities, and other
unique qualities in evaluating a grant application. We encourage
applicants to address these factors in the ``Need for Project'' section
of the application. We also note that the State Grant for Assistive
Technology program, a formula grant program funded under the AT Act of
1998, as amended, that provides grants to every State and outlying area
and considers a grantee's size and population in making awards,
authorizes grantees to develop programs that are similar to the AFPs as
one of their activities.
Changes: None.
Comment: One commenter suggested that the Department support
existing AFPs that have been effective but have little or no Federal
funding remaining.
Discussion: All States and outlying areas are eligible to apply.
However, we believe that the States and outlying areas that have not
previously received funding from the Federal government for this
purpose or that have small or underfunded AFPs that have received less
than $1 million from competitions under title III of the AT Act of 1998
during FYs 2000 through 2006 or under the Appropriations Acts for FY
2012 and 2013 should receive competitive priority.
Changes: None.
Comment: One commenter suggested that no new programs be
established with less than $3 million. According to this commenter,
without this amount of funding, a State cannot meet the need for loans.
This commenter also recommended that RSA encourage any State that has
less than $1 million in loanable funds to freeze the program until
adequate resources are available.
Discussion: The Act provided a total of $2 million for the AT AFP
competition, which is $1 million less than the minimum amount
recommended by the commenter. We agree that small AFPs should have the
opportunity to acquire additional funds, and are establishing a
competitive preference priority for programs that received less than $1
million in funds from competitions under title III of the AT Act of
1998 during FYs 2000 through 2006 or under the Appropriations Acts for
FYs 2012 and 2013. However, we do not agree that an AFP needs a minimum
of $3 million to be effective or that an AFP with less than $1 million
in loanable funds should be frozen. Many of the programs that received
less than $1 million in Federal funding in the past make significant
numbers of alternative financing loans and have proved themselves to be
beneficial to individuals with disabilities in their States.
Changes: None.
Comment: Two commenters suggested that RSA should support only
consumer-controlled, non-profit or community-based organizations as
grantees under this program in FY 2014.
Discussion: Because the Act states who is eligible for an award, we
do not have the authority to change the program's eligibility
requirements. Specifically, the Act states, ``State agencies and
community-based disability organizations that are directed by and
operated for individuals with disabilities shall be eligible to
compete.''
Changes: None.
Comment: One commenter expressed support for the 10 percent limit
on indirect expenses, and suggested that RSA collect fiscal expenditure
data on an annual basis to ensure compliance.
Discussion: For each 12-month budget period, grantees must
recalculate their allowable indirect cost rate, which may not exceed 10
percent of the portion of the grant award that is used annually for
program administration related to the AFP. RSA supports the 10 percent
limit on indirect expenses and will monitor grantees to ensure
compliance with this requirement.
Changes: None.
Final Priority:
Assistive Technology Alternative Financing Program.
The Assistant Secretary for Special Education and Rehabilitative
Services announces a priority to fund one-year grant awards to support
AFPs that assist individuals with disabilities to obtain financial
assistance for AT devices and services.
Under this priority, applicants must establish or expand one or
more of the following types of AFPs:
(1) A low-interest loan fund.
(2) An interest buy-down program.
(3) A revolving loan fund.
(4) A loan guarantee or insurance program.
(5) Another mechanism that is approved by the Secretary.
AFPs must be designed to allow individuals with disabilities and
their family members, guardians, advocates, and authorized
representatives to purchase AT devices or services. If family members,
guardians, advocates, and authorized representatives (including
employers who have been designated by an individual with a disability
as an authorized representative) receive AFP support to purchase AT
devices or services, the purchase must be solely for the benefit of an
individual with a disability.
To be considered for funding, an applicant must identify the type
or types of AFP(s) to be supported by the grant and submit all of the
following assurances:
(1) Permanent Separate Account: An assurance from the applicant
that--
(a) All funds that support the AFP, including funds repaid during
the life of the program, will be deposited in a permanent separate
account and identified and accounted for separately from any other
funds;
(b) If the grantee administering the program invests funds within
this account, the grantee will invest the funds in low-risk securities
in which a regulated insurance company may invest under the law of the
State; and
(c) The grantee will administer the funds with the same judgment
and care that a person of prudence, discretion, and intelligence would
exercise in the management of the financial affairs of that person.
[[Page 47578]]
(2) Permanence of the Program: An assurance that the AFP will
continue on a permanent basis.
An applicant's obligation to implement the AFP consistent with all
of the requirements, including reporting requirements, continues until
there are no longer any funds available to operate the AFP and all
outstanding loans have been repaid. If a grantee decides to terminate
its AFP while there are still funds available to operate the program,
the grantee must return the funds remaining in the permanent separate
account to the U.S. Department of the Treasury except for funds being
used for grant purposes, such as loan guarantees for outstanding loans.
However, before closing out its grant, the grantee also must return any
principal and interest remitted to it on outstanding loans and any
other funds remaining in the permanent separate account, such as funds
being used as loan guarantees for those loans.
(3) Consumer Choice and Control: An assurance that, and information
describing the manner in which, the AFP will expand and emphasize
consumer choice and control.
(4) Supplement-Not-Supplant: An assurance that the funds made
available through the grant to support the AFP will be used to
supplement and not supplant other Federal, State, and local public
funds expended to provide alternative financing mechanisms.
(5) Use and Control of Funds: An assurance that funds comprised of
the principal and interest from the account described in paragraph (1)
Permanent Separate Account of this priority will be available solely to
support the AFP.
This assurance regarding the use and control of funds applies to
all funds derived from the AFP, including the original Federal award,
AFP funds generated by either interest-bearing accounts or investments,
and all principal and interest paid by borrowers of the AFP who are
extended loans from the permanent separate account.
(6) Indirect Costs: An assurance that the percentage of the funds
used for indirect costs will not exceed 10 percent of the portion of
the grant award that is used annually for program administration
(excluding funds used for loan activity).
For each 12-month budget period, grantees must recalculate their
allowable indirect cost rate, which may not exceed 10 percent of the
portion of the grant award that is used annually for program
administration related to the AFP.
(7) Administrative Policies and Procedures: An assurance that the
applicant receiving a grant under this priority will submit to the
Secretary for review and approval within the 12-month project period
the following policies and procedures for administration of the AFP:
(a) A procedure to review and process in a timely manner requests
for financial assistance for immediate and potential technology needs,
including consideration of methods to reduce paperwork and duplication
of effort, particularly relating to need, eligibility, and
determination of the specific AT device or service to be financed
through the program.
(b) A policy and procedure to ensure that individuals are allowed
to apply for financing for a full array of AT devices and services
regardless of type of disability or health condition, age, income
level, location of residence in the State, or type of AT device or
service for which financing is requested through the program. It is
permissible for programs to target individuals with disabilities who
would have been denied conventional financing as a priority for AFP
funding.
(c) A procedure to ensure consumer choice and consumer-controlled
oversight of the program.
(d) A sustainability plan, including information on the percentage
of funds expected to be used for operating expenses and loan capital.
(8) Data Collection: An assurance that the applicant will collect
and report data requested by the Secretary in the format, with the
frequency, and using the method established by the Secretary until
there are no longer any funds available to operate the AFP and all
outstanding loans have been repaid.
(9) Credit Building Activities: An assurance that the AFP will
incorporate credit-building activities into its programs, including
financial education and information about other possible funding
sources.
Competitive Preference Priorities: Within this priority, we
announce two competitive preference priorities.
These priorities are:
Need to Establish an AFP (10 additional points): This applies to an
applicant located in a State or outlying area where an AFP grant has
not been previously awarded under title III of the AT Act of 1998 or
under the Appropriations Acts for FYs 2012 and 2013.
Need to Expand an AFP (5 additional points): This applies to an
applicant located in a State or outlying area where an AFP grant has
been previously awarded under title III of the AT Act of 1998 or under
the Appropriations Acts for FYs 2012 and 2013, but the State or
outlying area has received less than a total of $1 million in Federal
grant funds for the operation of its AFP under title III of the AT Act
of 1998 during fiscal years 2000 through 2006 and the appropriations
Acts for FYs 2012 and 2013.
Types of Priorities:
When inviting applications for a competition using one or more
priorities, we designate the type of each priority as absolute,
competitive preference, or invitational through a notice in the Federal
Register.The effect of each type of priority follows:
Absolute priority: Under an absolute priority, we consider only
applications that meet the priority (34 CFR 75.105(c)(3)).
Competitive preference priority: Under a competitive preference
priority, we give competitive preference to an application by (1)
awarding additional points, depending on the extent to which the
application meets the priority (34 CFR 75.105(c)(2)(i)); or (2)
selecting an application that meets the priority over an application of
comparable merit that does not meet the priority (34 CFR
75.105(c)(2)(ii)).
Invitational priority: Under an invitational priority, we are
particularly interested in applications that meet the priority.
However, we do not give an application that meets the priority a
preference over other applications (34 CFR 75.105(c)(1)).
This notice does not preclude us from proposing additional
priorities, requirements, definitions, or selection criteria, subject
to meeting applicable rulemaking requirements.
Note: This notice does not solicit applications. In any year in
which we choose to use this priority, we invite applications through
a notice in the Federal Register.
Executive Orders 12866 and 13563
Regulatory Impact Analysis
Under Executive Order 12866, the Secretary must determine whether
this regulatory action is ``significant'' and, therefore, subject to
the requirements of the Executive order and subject to review by the
Office of Management and Budget (OMB). Section 3(f) of Executive Order
12866 defines a ``significant regulatory action'' as an action likely
to result in a rule that may--
(1) Have an annual effect on the economy of $100 million or more,
or adversely affect a sector of the economy, productivity, competition,
jobs, the environment, public health or safety, or State, local, or
tribal governments or communities in a material way (also referred to
as an ``economically significant'' rule);
[[Page 47579]]
(2) Create serious inconsistency or otherwise interfere with an
action taken or planned by another agency;
(3) Materially alter the budgetary impacts of entitlement grants,
user fees, or loan programs or the rights and obligations of recipients
thereof; or
(4) Raise novel legal or policy issues arising out of legal
mandates, the President's priorities, or the principles set forth in
the Executive order.
This final regulatory action is not a significant regulatory action
subject to review by OMB under section 3(f) of Executive Order 12866.
We have also reviewed this final regulatory action under Executive
Order 13563, which supplements and explicitly reaffirms the principles,
structures, and definitions governing regulatory review established in
Executive Order 12866. To the extent permitted by law, Executive Order
13563 requires that an agency--
(1) Propose or adopt regulations only upon a reasoned determination
that their benefits justify their costs (recognizing that some benefits
and costs are difficult to quantify);
(2) Tailor its regulations to impose the least burden on society,
consistent with obtaining regulatory objectives and taking into
account--among other things and to the extent practicable--the costs of
cumulative regulations;
(3) In choosing among alternative regulatory approaches, select
those approaches that maximize net benefits (including potential
economic, environmental, public health and safety, and other
advantages; distributive impacts; and equity);
(4) To the extent feasible, specify performance objectives, rather
than the behavior or manner of compliance a regulated entity must
adopt; and
(5) Identify and assess available alternatives to direct
regulation, including economic incentives--such as user fees or
marketable permits--to encourage the desired behavior, or provide
information that enables the public to make choices.
Executive Order 13563 also requires an agency ``to use the best
available techniques to quantify anticipated present and future
benefits and costs as accurately as possible.'' The Office of
Information and Regulatory Affairs of OMB has emphasized that these
techniques may include ``identifying changing future compliance costs
that might result from technological innovation or anticipated
behavioral changes.''
We are issuing this final priority only on a reasoned determination
that its benefits justify its costs. In choosing among alternative
regulatory approaches, we selected those approaches that maximize net
benefits. Based on the analysis that follows, the Department believes
that this regulatory action is consistent with the principles in
Executive Order 13563.
We also have determined that this regulatory action does not unduly
interfere with State, local, and tribal governments in the exercise of
their governmental functions.
In accordance with both Executive orders, the Department has
assessed the potential costs and benefits, both quantitative and
qualitative, of this regulatory action. The potential costs are those
resulting from statutory requirements and those we have determined as
necessary for administering the Department's programs and activities.
Intergovernmental Review: This program is subject to Executive
Order 12372 and the regulations in 34 CFR part 79. One of the
objectives of the Executive order is to foster an intergovernmental
partnership and a strengthened federalism. The Executive order relies
on processes developed by State and local governments for coordination
and review of proposed Federal financial assistance.
This document provides early notification of our specific plans and
actions for this program.
Accessible Format: Individuals with disabilities can obtain this
document in an accessible format (e.g., braille, large print,
audiotape, or compact disc) by contacting the Grants and Contracts
Services Team, U.S. Department of Education, 400 Maryland Avenue SW.,
Room 5075, PCP, Washington, DC 20202-2550. Telephone: (202) 245-7363.
If you use a TDD or a TTY, call the FRS, toll free, at 1-800-877-8339.
Electronic Access to This Document: The official version of this
document is the document published in the Federal Register. Free
Internet access to the official edition of the Federal Register and the
Code of Federal Regulations is available via the Federal Digital System
at: www.gpo.gov/fdsys. At this site you can view this document, as well
as all other documents of this Department published in the Federal
Register, in text or Adobe Portable Document Format (PDF). To use PDF
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You may also access documents of the Department published in the
Federal Register by using the article search feature at:
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feature at this site, you can limit your search to documents published
by the Department.
Dated: August 11, 2014.
Michael K. Yudin,
Acting Assistant Secretary for Special Education and Rehabilitative
Services.
[FR Doc. 2014-19289 Filed 8-13-14; 8:45 am]
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