[Title 34 CFR ]
[Code of Federal Regulations (annual edition) - July 1, 2017 Edition]
[From the U.S. Government Publishing Office]



[[Page i]]

          

          Title 34

Education


________________________

Parts 1 to 299

                         Revised as of July 1, 2017

          Containing a codification of documents of general 
          applicability and future effect

          As of July 1, 2017
                    Published by the Office of the Federal Register 
                    National Archives and Records Administration as a 
                    Special Edition of the Federal Register

[[Page ii]]

          U.S. GOVERNMENT OFFICIAL EDITION NOTICE

          Legal Status and Use of Seals and Logos
          
          
          The seal of the National Archives and Records Administration 
              (NARA) authenticates the Code of Federal Regulations (CFR) as 
              the official codification of Federal regulations established 
              under the Federal Register Act. Under the provisions of 44 
              U.S.C. 1507, the contents of the CFR, a special edition of the 
              Federal Register, shall be judicially noticed. The CFR is 
              prima facie evidence of the original documents published in 
              the Federal Register (44 U.S.C. 1510).

          It is prohibited to use NARA's official seal and the stylized Code 
              of Federal Regulations logo on any republication of this 
              material without the express, written permission of the 
              Archivist of the United States or the Archivist's designee. 
              Any person using NARA's official seals and logos in a manner 
              inconsistent with the provisions of 36 CFR part 1200 is 
              subject to the penalties specified in 18 U.S.C. 506, 701, and 
              1017.

          Use of ISBN Prefix

          This is the Official U.S. Government edition of this publication 
              and is herein identified to certify its authenticity. Use of 
              the 0-16 ISBN prefix is for U.S. Government Publishing Office 
              Official Editions only. The Superintendent of Documents of the 
              U.S. Government Publishing Office requests that any reprinted 
              edition clearly be labeled as a copy of the authentic work 
              with a new ISBN.

              
              
          U . S . G O V E R N M E N T P U B L I S H I N G O F F I C E

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

          U.S. Superintendent of Documents  Washington, DC 20402-
              0001

          http://bookstore.gpo.gov

          Phone: toll-free (866) 512-1800; DC area (202) 512-1800

[[Page iii]]




                            Table of Contents



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

  Title 34:
          SUBTITLE A--Office of the Secretary, Department of 
          Education                                                  3
    SUBTITLE B--Regulations of the Offices of the Department 
      of Education
          Chapter I--Office for Civil Rights, Department of 
          Education                                                281
          Chapter II--Office of Elementary and Secondary 
          Education, Department of Education                       387
  Finding Aids:
      Table of CFR Titles and Chapters........................     597
      Alphabetical List of Agencies Appearing in the CFR......     617
      List of CFR Sections Affected...........................     627

[[Page iv]]


      


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

                     Cite this Code:  CFR
                     To cite the regulations in 
                       this volume use title, 
                       part and section number. 
                       Thus, 34 CFR 3.1 refers to 
                       title 34, part 3, 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

    The contents of the Federal Register are required to be judicially 
noticed (44 U.S.C. 1507). The Code of Federal Regulations is prima facie 
evidence of the text of the original documents (44 U.S.C. 1510).

HOW TO USE THE CODE OF FEDERAL REGULATIONS

    The Code of Federal Regulations is kept up to date by the individual 
issues of the Federal Register. These two publications must be used 
together to determine the latest version of any given rule.
    To determine whether a Code volume has been amended since its 
revision date (in this case, July 1, 2017), consult the ``List of CFR 
Sections Affected (LSA),'' which is issued monthly, and the ``Cumulative 
List of Parts Affected,'' which appears in the Reader Aids section of 
the daily Federal Register. These two lists will identify the Federal 
Register page number of the latest amendment of any given rule.

EFFECTIVE AND EXPIRATION DATES

    Each volume of the Code contains amendments published in the Federal 
Register since the last revision of that volume of the Code. Source 
citations for the regulations are referred to by volume number and page 
number of the Federal Register and date of publication. Publication 
dates and effective dates are usually not the same and care must be 
exercised by the user in determining the actual effective date. In 
instances where the effective date is beyond the cut-off date for the 
Code a note has been inserted to reflect the future effective date. In 
those instances where a regulation published in the Federal Register 
states a date certain for expiration, an appropriate note will be 
inserted following the text.

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 recordkeeping or reporting 
requirements.

PAST PROVISIONS OF THE CODE

    Provisions of the Code that are no longer in force and effect as of 
the revision date stated on the cover of each volume are not carried. 
Code users may find the text of provisions in effect on any given date 
in the past by using the appropriate List of CFR Sections Affected 
(LSA). For the convenience of the reader, a ``List of CFR Sections 
Affected'' is published at the end of each CFR volume. For changes to 
the Code prior to the LSA listings at the end of the volume, consult 
previous annual editions of the LSA. For changes to the Code prior to 
2001, consult the List of CFR Sections Affected compilations, published 
for 1949-1963, 1964-1972, 1973-1985, and 1986-2000.

``[RESERVED]'' TERMINOLOGY

    The term ``[Reserved]'' is used as a place holder within the Code of 
Federal Regulations. An agency may add regulatory information at a 
``[Reserved]'' location at any time. Occasionally ``[Reserved]'' is used 
editorially to indicate that a portion of the CFR was left vacant and 
not accidentally dropped due to a printing or computer error.

INCORPORATION BY REFERENCE

    What is incorporation by reference? Incorporation by reference was 
established by statute and allows Federal agencies to meet the 
requirement to publish regulations in the Federal Register by referring 
to materials already published elsewhere. For an incorporation to be 
valid, the Director of the Federal Register must approve it. The legal 
effect of incorporation by reference is that the material is treated as 
if it were published in full in the Federal Register (5 U.S.C. 552(a)). 
This material, like any other properly issued regulation, has the force 
of law.
    What is a proper incorporation by reference? The Director of the 
Federal Register will approve an incorporation by reference only when 
the requirements of 1 CFR part 51 are met. Some of the elements on which 
approval is based are:
    (a) The incorporation will substantially reduce the volume of 
material published in the Federal Register.
    (b) The matter incorporated is in fact available to the extent 
necessary to afford fairness and uniformity in the administrative 
process.
    (c) The incorporating document is drafted and submitted for 
publication in accordance with 1 CFR part 51.
    What if the material incorporated by reference cannot be found? If 
you have any problem locating or obtaining a copy of material listed as 
an approved incorporation by reference, please contact the agency that 
issued the regulation containing that incorporation. If, after 
contacting the agency, you find the material is not available, please 
notify the Director of the Federal Register, National Archives and 
Records Administration, 8601 Adelphi Road, College Park, MD 20740-6001, 
or call 202-741-6010.

CFR INDEXES AND TABULAR GUIDES

    A subject index to the Code of Federal Regulations is contained in a 
separate volume, revised annually as of January 1, entitled CFR Index 
and Finding Aids. This volume contains the Parallel Table of Authorities 
and Rules. A list of CFR titles, chapters, subchapters, and parts and an 
alphabetical list of agencies publishing in the CFR are also included in 
this volume.

[[Page vii]]

    An index to the text of ``Title 3--The President'' is carried within 
that volume.
    The Federal Register Index is issued monthly in cumulative form. 
This index is based on a consolidation of the ``Contents'' entries in 
the daily Federal Register.
    A List of CFR Sections Affected (LSA) is published monthly, keyed to 
the revision dates of the 50 CFR titles.

REPUBLICATION OF MATERIAL

    There are no restrictions on the republication of material appearing 
in the Code of Federal Regulations.

INQUIRIES

    For a legal interpretation or explanation of any regulation in this 
volume, contact the issuing agency. The issuing agency's name appears at 
the top of odd-numbered pages.
    For inquiries concerning CFR reference assistance, call 202-741-6000 
or write to the Director, Office of the Federal Register, National 
Archives and Records Administration, 8601 Adelphi Road, College Park, MD 
20740-6001 or e-mail [email protected]

SALES

    The Government Publishing Office (GPO) processes all sales and 
distribution of the CFR. For payment by credit card, call toll-free, 
866-512-1800, or DC area, 202-512-1800, M-F 8 a.m. to 4 p.m. e.s.t. or 
fax your order to 202-512-2104, 24 hours a day. For payment by check, 
write to: US Government Publishing Office - New Orders, P.O. Box 979050, 
St. Louis, MO 63197-9000.

ELECTRONIC SERVICES

    The full text of the Code of Federal Regulations, the LSA (List of 
CFR Sections Affected), The United States Government Manual, the Federal 
Register, Public Laws, Public Papers of the Presidents of the United 
States, Compilation of Presidential Documents and the Privacy Act 
Compilation are available in electronic format via www.ofr.gov. For more 
information, contact the GPO Customer Contact Center, U.S. Government 
Publishing Office. Phone 202-512-1800, or 866-512-1800 (toll-free). E-
mail, [email protected]
    The Office of the Federal Register also offers a free service on the 
National Archives and Records Administration's (NARA) World Wide Web 
site for public law numbers, Federal Register finding aids, and related 
information. Connect to NARA's web site at www.archives.gov/federal-
register.
    The e-CFR is a regularly updated, unofficial editorial compilation 
of CFR material and Federal Register amendments, produced by the Office 
of the Federal Register and the Government Publishing Office. It is 
available at www.ecfr.gov.

    Oliver A. Potts,
    Director,
    Office of the Federal Register.
    July 1, 2017.

                                
                                      
                            

  

[[Page ix]]



                               THIS TITLE

    Title 34--Education is composed of four volumes. The parts in these 
volumes are arranged in the following order: Parts 1-299, parts 300-399, 
parts 400-679, and part 680 to end. The contents of these volumes 
represent all regulations codified under this title of the CFR as of 
July 1, 2017.

    For this volume, Michele Bugenhagen was Chief Editor. The Code of 
Federal Regulations publication program is under the direction of John 
Hyrum Martinez, assisted by Stephen J. Frattini.

[[Page 1]]



                           TITLE 34--EDUCATION




                   (This book contains parts 1 to 299)

  --------------------------------------------------------------------
                                                                    Part

SUBTITLE A--Office of the Secretary, Department of Education           3

  SUBTITLE B--Regulations of the Offices of the Department of Education

chapter I--Office for Civil Rights, Department of Education.         100

chapter II--Office of Elementary and Secondary Education, 
  Department of Education...................................         200

[[Page 3]]

      Subtitle A--Office of the Secretary, Department of Education

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

Part                                                                Page
1-2             [Reserved]

3               Official seal...............................           5
4               Service of process..........................           6
5               Availability of information to the public...           6
5b              Privacy Act regulations.....................          16
6               Inventions and patents (general)............          27
7               Employee inventions.........................          28
8               Demands for testimony or records in legal 
                    proceedings.............................          29
12              Disposal and utilization of surplus Federal 
                    real property for educational purposes..          32
15              Uniform relocation assistance and real 
                    property acquisition for Federal and 
                    federally assisted programs.............          42
21              Equal access to justice.....................          42
30              Debt collection.............................          51
31              Salary offset for Federal employees who are 
                    indebted to the United States under 
                    programs administered by the Secretary 
                    of Education............................          61
32              Salary offset to recover overpayments of pay 
                    or allowances from Department of 
                    Education employees.....................          68
33              Program Fraud Civil Remedies Act............          72
34              Administrative wage garnishment.............          89
35              Tort claims against the Government..........          97
36              Adjustment of civil monetary penalties for 
                    inflation...............................         101
60              Indemnification of Department of Education 
                    employees...............................         101
73              Standards of conduct........................         103
75              Direct grant programs.......................         103

[[Page 4]]

76              State-administered programs.................         142
77              Definitions that apply to Department 
                    regulations.............................         177
79              Intergovernmental review of Department of 
                    Education programs and activities.......         181
80              [Reserved]

81              General Education Provisions Act--
                    enforcement.............................         185
82              New restrictions on lobbying................         199
84              Governmentwide requirements for drug-free 
                    workplace (financial assistance)........         211
86              Drug and alcohol abuse prevention...........         217
97              Protection of human subjects................         225
98              Student rights in research, experimental 
                    programs, and testing...................         253
99              Family educational rights and privacy.......         256

[[Page 5]]

                          PARTS 1	2 [RESERVED]



PART 3_OFFICIAL SEAL--Table of Contents



Sec.
3.1  Definitions.
3.2  Description.
3.3  Authority to affix seal.
3.4  Use of the seal.

    Authority: 20 U.S.C. 3472 and 3485, unless otherwise noted.

    Source: 45 FR 86491, Dec. 31, 1980, unless otherwise noted.



Sec. 3.1  Definitions.

    For the purposes of this part:
    (a) ED means all organizational units of the Department of 
Education.
    (b) Embossing Seal means a display of the form and content of the 
Official Seal made on a die so that the Seal can be embossed on paper or 
other media.
    (c) Official Seal means the original(s) of the Seal showing the 
exact form, content, and colors.
    (d) Replica means a copy of the Official Seal displaying the 
identical form, content, and colors.
    (e) Reproduction means a copy of the Official Seal displaying the 
form and content, reproduced in only one color.
    (f) Secretary means the Secretary of Education.



Sec. 3.2  Description.

    The Official Seal of the Department of Education is described as 
follows: Standing upon a mound, an oak tree with black trunk and limbs 
and green foliage in front of a gold rising sun, issuing gold rays on a 
light blue disc, enclosed by a dark blue border with gold edges bearing 
the inscription ``DEPARTMENT OF EDUCATION'' above a star at either side 
of the words ``UNITED STATES OF AMERICA'' in smaller letters in the 
base; letters and stars in white. The Offical Seal of the Department is 
modified when used in reproductions in black and white and when 
embossed. As so modified, it appears below.
[GRAPHIC] [TIFF OMITTED] TC21OC91.062



Sec. 3.3  Authority to affix seal.

    The Secretary and the Secretary's designees are authorized to affix 
the Official Seal, replicas, reproductions, and embossing seals to 
appropriate documents, certifications, and other material for all 
purposes as authorized by this section.

(Authority: 20 U.S.C. 3474)



Sec. 3.4  Use of the seal.

    (a) Use by any person or organization outside of the Department may 
be made only with the Department's prior written approval.
    (b) Requests by any person or organization outside of the Department 
for permission to use the Seal must be made in writing to Director of 
Public Affairs, U.S. Department of Education, 400 Maryland Avenue, SW., 
Washington, DC 20202, and must specify, in detail, the exact use to be 
made. Any permission granted applies only to the specific use for which 
it was granted and is not to be construed as permission for any other 
use.
    (c) In regard to internal use, replicas may be used only:
    (1) For display in or adjacent to ED facilities, in Departmental 
auditoriums, presentation rooms, hearing rooms, lobbies, and public 
document rooms;
    (2) In offices of senior officials;
    (3) For official awards, certificates, medals, and plaques;
    (4) For electronic media, motion picture film, video tape and other 
audiovisual media prepared by or for ED and attributed thereto;

[[Page 6]]

    (5) On official publications which represent the achievements or 
mission of ED;
    (6) In non-ED facilities in connection with events and displays 
sponsored by ED, and public appearances of the Secretary or other senior 
ED officials; and
    (7) For other internal purposes as determined by the Director for 
Management;
    (d) In regard to internal use, reproductions may be used only--
    (1) On ED letterhead stationery;
    (2) On official ED identification cards, security, and other 
approved credentials;
    (3) On business cards for ED employees;
    (4) On official ED signs;
    (5) On official publications or graphics issued by and attributed to 
ED, or joint statements of ED with one or more other Federal agencies, 
State or local governments, or foreign governments;
    (6) On official awards, certificates, and medals;
    (7) On electronic media, motion picture film, video tape, and other 
audiovisual media prepared by or for ED and attributed thereto; and
    (8) For other internal purposes as determined by the Director for 
Management.
    (e) Embossing seals may be used only internally--
    (1) On ED legal documents, including interagency or 
intergovernmental agreements, agreements with State or local 
governments, foreign patent applications, certification(s) of true 
copies, and similar documents;
    (2) On official awards and certificates; and
    (3) For other purposes as determined by the General Counsel or the 
Director for Management.
    (f) Falsely making, forging, counterfeiting, mutilating, or altering 
the Official Seal, replicas, reproductions, or embossing seals, or 
knowingly using or possessing with fraudulent intent and altered 
official seal, replica, reproduction or embossing seal is punishable 
under 18 U.S.C. 506.
    (g) Any person using the Official Seal, replicas, reproductions, or 
embossing seals in a manner inconsistent with the provisions of this 
part is subject to the provisions of 18 U.S.C. 1017, which states 
penalties for the wrongful use of an Official Seal, and to other 
provisions of law as applicable.

[45 FR 86491, Dec. 31, 1980, as amended at 53 FR 4620, Feb. 17, 1988; 56 
FR 65388, Dec. 16, 1991; 65 FR 57286, Sept. 22, 2000]



PART 4_SERVICE OF PROCESS--Table of Contents





Sec. 4.1  Service of process required to be served on or delivered
to Secretary.

    Summons, complaints, subpoenas, and other process which are required 
to be served on or delivered to the Secretary of Education shall be 
delivered to the General Counsel or a Deputy General Counsel, by mail at 
400 Maryland Avenue SW., Washington, DC 20202 or by personal service at 
that address. The persons above designated are authorized to accept 
service of such process.

(Authority: 5 U.S.C. 301)

[47 FR 16780, Apr. 20, 1982]



PART 5_AVAILABILITY OF INFORMATION TO THE PUBLIC--Table of Contents



                      Subpart A_General Provisions

Sec.
5.1  Purpose.
5.2  Definitions.

                Subpart B_Records Available to the Public

5.10  Public reading room.
5.11  Business information.
5.12  Creation of records not required.
5.13  Preservation of records.

Subpart C_Procedures for Requesting Access to Records and Disclosure of 
                                 Records

5.20  Requirements for making FOIA requests.
5.21  Procedure for processing FOIA requests.

                             Subpart D_Fees

5.30  Fees generally.
5.31  Fee definitions.
5.32  Assessment of fees.
5.33  Requirements for waiver or reduction of fees.

                     Subpart E_Administrative Review

5.40  Appeals of adverse determinations.


[[Page 7]]


    Authority: 5 U.S.C. 552.

    Source: 75 FR 33510, June 14, 2010, unless otherwise noted.



                      Subpart A_General Provisions



Sec. 5.1  Purpose.

    This part contains the regulations that the United States Department 
of Education follows in processing requests for records under the 
Freedom of Information Act, as amended, 5 U.S.C. 552. These regulations 
must be read in conjunction with the FOIA, including its exemptions to 
disclosure, and, when appropriate, in conjunction with the Privacy Act 
of 1974, as amended, 5 U.S.C. 552a, and its implementing regulations in 
34 CFR part 5b.

(Authority: 5 U.S.C. 552(a), 20 U.S.C. 3474)



Sec. 5.2  Definitions.

    As used in this part:
    (a) Act or FOIA means the Freedom of Information Act, as amended, 5 
U.S.C. 552.
    (b) Department means the United States Department of Education.
    (c) Component means each separate bureau, office, board, division, 
commission, service, administration, or other organizational entity of 
the Department.
    (d) FOIA request means a written request for agency records that 
reasonably describes the agency records sought, made by any person, 
including a member of the public (U.S. or foreign citizen/entity), 
partnership, corporation, association, and foreign or domestic 
governments (excluding Federal agencies).
    (e)(1) Agency records are documentary materials regardless of 
physical form or characteristics that--
    (i) Are either created or obtained by the Department; and
    (ii) Are under the Department's control at the time it receives a 
FOIA request.
    (2) Agency records include--
    (i) Records created, stored, and retrievable in electronic format;
    (ii) Records maintained for the Department by a private entity under 
a records management contract with the Federal Government; and
    (iii) Documentary materials preserved by the Department as evidence 
of the organization, functions, policies, decisions, procedures, 
operations or other activities of the Department or because of the 
informational value of data contained therein.
    (3) Agency records do not include tangible, evidentiary objects or 
equipment; library or museum materials made or acquired and preserved 
solely for reference or exhibition purposes; extra copies of documents 
preserved only for convenience of reference; stocks of publications; and 
personal records created for the convenience of an individual and not 
used to conduct Department business or incorporated into the 
Department's record keeping system or files.

(Authority: 5 U.S.C. 552(a), 20 U.S.C. 3474)



            Subpart B_Agency Records Available to the Public



Sec. 5.10  Public reading room.

    (a) General. Pursuant to 5 U.S.C. 552(a)(2), the Department 
maintains a public reading room containing agency records that the FOIA 
requires to be made regularly available for public inspection and 
copying. Published records of the Department, whether or not available 
for purchase, are made available for examination. The Department's 
public reading room is located at the National Library of Education, 400 
Maryland Avenue, SW., Plaza Level (Level B), Washington, DC 20202-0008. 
The hours of operation are 9:00 a.m. to 5:00 p.m., Monday through Friday 
(except Federal holidays).
    (b) Reading room records. Agency records maintained in the public 
reading room include final opinions and orders in adjudications, 
statements of policy and interpretations adopted by the Department and 
not published in the Federal Register, administrative staff manuals and 
instructions affecting the public, and copies of all agency records 
regardless of form or format released to the public pursuant to a FOIA 
request that the Department determines are likely to be the subject of 
future FOIA requests.
    (c) Electronic access. The Department makes reading room records 
created on

[[Page 8]]

or after November 1, 1996, available through its electronic reading 
room, located on the Department's FOIA Web site at http://www2.ed.gov/
policy/gen/leg/foia/readingroom.html.

(Authority: 5 U.S.C. 552(a), 5 U.S.C. 552(a)(2), 20 U.S.C. 3474)



Sec. 5.11  Business information.

    (a) General. The Department discloses business information it 
obtains from a submitter under the Act in accordance with this section.
    (b) Definitions. For purposes of this section:
    (1) Business information means commercial or financial information 
obtained by the Department from a submitter that may be protected from 
disclosure under 5 U.S.C. 552(b)(4) (Exemption 4 of the Act).
    (2) Submitter means any person or entity (including corporations; 
State, local, and tribal governments; and foreign governments) from whom 
the Department obtains business information.
    (c) Designation of business information.
    (1) A submitter must use good faith efforts to designate, by 
appropriate markings, either at the time of submission or at a 
reasonable time thereafter, any portion of its submission that it 
considers to be business information protected from disclosure under 
Exemption 4 of the Act.
    (2) A submitter's designations are not binding on the Department and 
will expire 10 years after the date of the submission unless the 
submitter requests, and provides justification for, a longer designation 
period.
    (3) A blanket designation on each page of a submission that all 
information contained on the page is protected from disclosure under 
Exemption 4 presumptively will not be considered a good faith effort.
    (d) Notice to submitters. Except as provided in paragraph (g) of 
this section, the Department promptly notifies a submitter whenever a 
FOIA request or administrative appeal is made under the Act seeking 
disclosure of the information the submitter has designated in good faith 
as business information protected from disclosure under paragraph (c) of 
this section, or the Department otherwise has reason to believe that it 
may be required to disclose information sought to be designated by the 
submitter as business information protected from disclosure under 
Exemption 4 of the Act. This notice includes either a description of the 
business information requested or copies of the requested agency records 
or portions of agency records containing the requested business 
information as well as a time period, consistent with Sec. 5.21(c), 
within which the submitter can object to the disclosure pursuant to 
paragraph (e) of this section.
    (e) Opportunity to object to disclosure.
    (1) If a submitter objects to disclosure, it must submit to the 
Department a detailed written statement specifying all grounds under 
Exemption 4 of the Act for denying access to the information, or a 
portion of the information sought.
    (2) A submitter's failure to object to the disclosure by the 
deadline established by the Department in the notice provided under 
paragraph (d) of this section constitutes a waiver of the submitter's 
right to object to disclosure under paragraph (e) of this section.
    (3) A submitter's response to a notice from the Department under 
paragraph (d) of this section may itself be subject to disclosure under 
the Act.
    (f) Notice of intent to disclose. The Department considers a 
submitter's objections and submissions made in support thereof in 
deciding whether to disclose business information sought to be protected 
by the submitter. Whenever the Department decides to disclose 
information over a submitter's objection, the Department gives the 
submitter written notice, which includes:
    (1) A statement of the reasons why the submitter's objections to 
disclosure were not sustained.
    (2) A description of the information to be disclosed.
    (3) A specified disclosure date that is a reasonable time subsequent 
to the notice.
    (g) Exceptions to notice requirements. The notice requirements of 
paragraph (d) of this section do not apply if--
    (1) The Department does not disclose the business information of the 
submitter;
    (2) The Department has previously lawfully published the 
information;

[[Page 9]]

    (3) The information has been made available to the public by the 
requester or by third parties;
    (4) Disclosure of the information is required by statute (other than 
the Act) or regulation issued in accordance with the requirements of 
Executive Order 12600 (52 FR 23781, 3 CFR, 1987 Comp., p. 235); or
    (5) The designation made by the submitter under paragraph (c) of 
this section appears obviously frivolous, except that, in such case, the 
Department must provide the submitter with written notice of any final 
administrative disclosure determination in accordance with paragraph (f) 
of this section.
    (h) Notice of FOIA lawsuit. Whenever a requester files a lawsuit 
seeking to compel the disclosure of a submitter's business information, 
the Department promptly notifies the submitter.
    (i) Corresponding notice to requester. The Department notifies the 
requester whenever it notifies a submitter of its opportunity to object 
to disclosure, of the Department's intent to disclose requested 
information designated as business information by the submitter, or of 
the filing of a lawsuit.
    (j) Notice of reverse FOIA lawsuit. Whenever a submitter files a 
lawsuit seeking to prevent the disclosure of the submitter's 
information, the Department promptly notifies the requester, and advises 
the requester that its request will be held in abeyance until the 
lawsuit initiated by the submitter is resolved.

(Authority: 5 U.S.C. 552(a), 20 U.S.C. 3474)



Sec. 5.12  Creation of agency records not required.

    In response to a FOIA request, the Department produces only those 
agency records that are not already publicly available and that are in 
existence at the time it receives a request. The Department does not 
create new agency records in response to a FOIA request by, for example, 
extrapolating information from existing agency records, reformatting 
available information, preparing new electronic programs or databases, 
or creating data through calculations of ratios, proportions, 
percentages, trends, frequency distributions, correlations, or 
comparisons.

(Authority: 5 U.S.C. 552(a), 20 U.S.C. 3474)



Sec. 5.13  Preservation of agency records.

    The Department does not destroy agency records that are the subject 
of a pending FOIA request, appeal, or lawsuit.

(Authority: 5 U.S.C. 552(a), 20 U.S.C. 3474)



    Subpart C_Procedures for Requesting Access to Agency Records and 
                      Disclosure of Agency Records



Sec. 5.20  Requirements for making FOIA requests.

    (a) Making a FOIA request. Any FOIA request for an agency record 
must be in writing (via paper, facsimile, or electronic mail) and 
transmitted to the Department as indicated on the Department's Web site. 
See http://www.ed.gov/policy/gen/leg/foia/request_foia.html.
    (b) Description of agency records sought. A FOIA request must 
reasonably describe the agency record sought, to enable Department 
personnel to locate the agency record or records with a reasonable 
amount of effort. Whenever possible, a FOIA request should describe the 
type of agency record requested, the subject matter of the agency 
record, the date, if known, or general time period when it was created, 
and the person or office that created it. Requesters who have detailed 
information that would assist in identifying and locating the agency 
records sought are urged to provide this information to the Department 
to expedite the handling of a FOIA request.
    (c) FOIA request deemed insufficient. If the Department determines 
that a FOIA request does not reasonably describe the agency record or 
records sought, the FOIA request will be deemed insufficient under the 
Act. In that case, the Department informs the requester of the reason 
the FOIA request is insufficient and, at the Department's option, either 
administratively closes the FOIA request as insufficient without 
determining whether to grant the FOIA request or provides the requester 
an opportunity to modify the

[[Page 10]]

FOIA request to meet the requirements of this section.
    (d) Verification of identity. In compliance with the Privacy Act of 
1974, as amended, 5 U.S.C. 552a, FOIA requests for agency records 
pertaining to the requester, a minor, or an individual who is legally 
incompetent must include verification of the requester's identity 
pursuant to 34 CFR 5b.5.

(Authority: 5 U.S.C. 552(a), 20 U.S.C. 3474)



Sec. 5.21  Procedures for processing FOIA requests.

    (a) Acknowledgements of FOIA requests. The Department promptly 
notifies the requester when it receives a FOIA request.
    (b) Consultation and referrals. When the Department receives a FOIA 
request for a record or records created by or otherwise received from 
another agency of the Federal Government, it either responds to the FOIA 
request after consultation with the other agency, or refers the FOIA 
request to the other agency for processing. When the Department refers a 
FOIA request to another agency for processing, the Department will so 
notify the requester.
    (c) Decisions on FOIA requests. The Department determines whether to 
comply with a FOIA request within 20 working days after the appropriate 
component of the Department first receives the request. This time period 
commences on the date that the request is received by the appropriate 
component of the Department, but commences no later than 10 calendar 
days after the request is received by the component of the Department 
designated pursuant to Sec. 5.20(a) to receive FOIA requests for agency 
records. The Department's failure to comply with these time limits 
constitutes exhaustion of the requester's administrative remedies for 
the purposes of judicial action to compel disclosure.
    (d) Requests for additional information. The Department may make one 
request for additional information from the requester and toll the 20-
day period while awaiting receipt of the additional information.
    (e) Extension of time period for processing a FOIA request. The 
Department may extend the time period for processing a FOIA request only 
in unusual circumstances, as described in paragraphs (e)(1) through 
(e)(3) of this section, in which case the Department notifies the 
requester of the extension in writing. A notice of extension affords the 
requester the opportunity either to modify its FOIA request so that it 
may be processed within the 20-day time limit, or to arrange with the 
Department an alternative time period within which the FOIA request will 
be processed. For the purposes of this section, unusual circumstances 
include:
    (1) The need to search for and collect the requested agency records 
from field facilities or other establishments that are separate from the 
office processing the request.
    (2) The need to search for, collect, and review and process 
voluminous agency records responsive to the FOIA request.
    (3) The need to consult with another agency or two or more agency 
components having a substantial interest in the determination on the 
FOIA request.
    (f) FOIA Public Liaison and FOIA Requester Service Center. The 
Department's FOIA Public Liaison assists in the resolution of disputes 
between the requester and the Department. The Department provides 
information about the status of a FOIA request to the requester through 
the Department's FOIA Requester Service Center. Contact information for 
the Department's FOIA Public Liaison and FOIA Requester Service Center 
may be found at http://www.ed.gov/policy/gen/leg/foia/contacts.html.
    (g) Notification of determination. Once the Department makes a 
determination to grant a FOIA request in whole or in part, it notifies 
the requester in writing of its decision.
    (h) Denials of FOIA requests.
    (1) Only Departmental officers or employees delegated the authority 
to deny a FOIA request may deny a FOIA request on behalf of the 
Department.
    (2)(i) The Department notifies the requester in writing of any 
decision to deny a FOIA request in whole or in part. Denials under this 
paragraph can include the following: A determination to deny access in 
whole or in part to

[[Page 11]]

any agency record responsive to a request; a determination that a 
requested agency record does not exist or cannot be located in the 
Department's records; a determination that a requested agency record is 
not readily retrievable or reproducible in the form or format sought by 
the requester; a determination that what has been requested is not a 
record subject to the FOIA; a determination on any disputed fee matter, 
including a denial of a request for a fee waiver; and a denial of a 
request for expedited processing.
    (ii) All determinations denying a FOIA request in whole or in part 
are signed by an officer or employee designated under paragraph (h)(1) 
of this section, and include:
    (A) The name and title or position of the denying officer or 
employee.
    (B) A brief statement of the reason or reasons for the denial, 
including any exemptions applicable under the Act.
    (C) An estimate of the volume of agency records or information 
denied, by number of pages or other reasonable estimate (except where 
the volume of agency records or information denied is apparent from 
deletions made on agency records disclosed in part, or providing an 
estimate would harm an interest protected by an applicable exemption 
under the Act).
    (D) Where an agency record has been disclosed only in part, an 
indication of the exemption under the Act justifying the redaction in 
the agency record (unless providing this information would harm an 
interest protected by an applicable exemption under the Act).
    (E) A statement of appeal rights and a list of requirements for 
filing an appeal under Sec. 5.40.
    (i) Timing of responses to FOIA requests.
    (1) Multitrack processing.
    The Department may use two or more processing tracks to distinguish 
between simple and more complex FOIA requests based on one or more of 
the following: the time and work necessary to process the FOIA request, 
the volume of agency records responsive to the FOIA request, and whether 
the FOIA request qualifies for expedited processing as described in 
paragraph (i)(2) of this section.
    (2) Expedited processing.
    (i) The Department gives expedited treatment to FOIA requests and 
appeals whenever the Department determines that a FOIA request involves 
one or more of the following:
    (A) A circumstance in which the lack of expedited treatment could 
reasonably be expected to pose an imminent threat to the life or 
physical safety of an individual.
    (B) The urgent need of a person primarily engaged in disseminating 
information to inform the public about an actual or alleged Federal 
Government activity; or
    (C) Other circumstances that the Department determines demonstrate a 
compelling need for expedited processing.
    (ii) A requester may ask for expedited processing at the time of the 
initial FOIA request or at any time thereafter.
    (iii) A request for expedited processing must contain a detailed 
explanation of the basis for the request, and must be accompanied by a 
statement certifying the truth of the circumstances alleged or other 
evidence of the requester's compelling need acceptable to the 
Department.
    (iv) The Department makes a determination whether to grant or deny a 
request for expedited processing within 10 calendar days of its receipt 
by the component of the Department designated pursuant to Sec. 5.20(a) 
to receive FOIA requests for agency records, and processes FOIA requests 
accepted for expedited processing as soon as practicable and on a 
priority basis.

(Authority: 5 U.S.C. 552(a), 20 U.S.C. 3474)



                             Subpart D_Fees



Sec. 5.30  Fees generally.

    The Department assesses fees for processing FOIA requests in 
accordance with Sec. 5.32(a), except where fees are limited under 
Sec. 5.32(b) or where a waiver or reduction of fees is granted under 
Sec. 5.33. Requesters must pay fees by check or money order made payable 
to the U.S. Department of Education, and must include the FOIA request 
number on the check or money order.

[[Page 12]]

The Department retains full discretion to limit or adjust fees.

(Authority: 5 U.S.C. 552(a), 5 U.S.C. 552(a)(4)(A), 20 U.S.C. 3474)



Sec. 5.31  Fee definitions.

    (a) Commercial use request means a request from or on behalf of a 
FOIA requester seeking information for a use or purpose that furthers 
the requester's commercial, trade, or profit interests, which can 
include furthering those interests through litigation. For the purpose 
of assessing fees under the Act, the Department determines, whenever 
reasonably possible, the use to which a requester will put the requested 
agency records.
    (b) Direct costs mean those expenses that an agency actually incurs 
in searching for and duplicating (and, in the case of commercial use 
FOIA requests, reviewing) agency records to respond to a FOIA request. 
Direct costs include, for example, the pro rata salary of the 
employee(s) performing the work (i.e., basic rate of pay plus 16 
percent) and the cost of operating duplication machinery. The 
Department's other overhead expenses are not included in direct costs.
    (c) Duplication means making a copy of the agency record, or of the 
information in it, as necessary to respond to a FOIA request. Copies can 
be made in several forms and formats, including paper and electronic 
records. The Department honors a requester's specified preference as to 
form or format of disclosure, provided that the agency record is readily 
reproducible with reasonable effort in the requested form or format.
    (d) Educational institution means a preschool, a public or private 
elementary or secondary school, an institution of undergraduate higher 
education, an institution of graduate higher education, an institution 
of professional education, or an institution of vocational education, 
that operates a program of scholarly research. To qualify as an 
educational institution under this part, a requester must demonstrate 
that an educational institution authorized the request and that the 
agency records are not sought for individual or commercial use, but are 
instead sought to further scholarly research. A request for agency 
records for the purpose of affecting a requester's application for, or 
prospect of obtaining, new or additional grants, contracts, or similar 
funding is presumptively a commercial use request.
    (e) Noncommercial scientific institution means an institution that 
is operated solely for the purpose of conducting scientific research, 
the results of which are not intended to promote any particular product 
or industry. A noncommercial scientific institution does not operate for 
a ``commercial use'', as the term is defined in paragraph (a) of this 
section. To qualify as a noncommercial scientific institution under this 
part, a requester must demonstrate that a noncommercial scientific 
institution authorized the request and that the agency records are 
sought to further scientific research and not for a commercial use. A 
request for agency records for the purpose of affecting a requester's 
application for, or prospect of obtaining, new or additional grants, 
contracts, or similar funding is presumptively a commercial use request.
    (f) Representative of the news media, or news media requester, means 
any person or entity that gathers information of potential interest to a 
segment of the public, uses its editorial skills to turn the raw 
materials into a distinct work, and distributes that work to an 
audience. For the purposes of this section, the term ``news'' means 
information about current events or information that would be of current 
interest to the public. Examples of news media entities include 
television or radio stations broadcasting to the public at large and 
publishers of periodicals that qualify as disseminators of news and make 
their products available for purchase by, subscription by, or free 
distribution to the general public. To be regarded as a representative 
of the news media, a ``freelance'' journalist must demonstrate a solid 
basis for expecting publication, such as a publication contract or a 
past publication record. For inclusion in this category, a requester 
must not be seeking the requested agency records for a commercial use.
    (g) Review means the examination of an agency record located in 
response to a FOIA request to determine whether

[[Page 13]]

any portion of the record is exempt from disclosure under the Act. 
Reviewing the record includes processing the agency record for 
disclosure and making redactions and other preparations for disclosure. 
Review costs are recoverable even if an agency record ultimately is not 
disclosed. Review time includes time spent considering any formal 
objection to disclosure but does not include time spent resolving 
general legal or policy issues regarding the application of exemptions 
under the Act.
    (h) Search means the process of looking for and retrieving agency 
records or information responsive to a FOIA request. Searching includes 
page-by-page or line-by-line identification of information within agency 
records and reasonable efforts to locate and retrieve information from 
agency records maintained in electronic form or format, provided that 
such efforts do not significantly interfere with the operation of the 
Department's automated information systems.

(Authority: 5 U.S.C. 552(a), 5 U.S.C. 552(a)(4)(A), 20 U.S.C. 3474)



Sec. 5.32  Assessment of fees.

    (a) Fees. In responding to FOIA requests, the Department charges the 
following fees (in accordance with the Office of Management and Budget's 
``Uniform FOIA Fee Schedule and Guidelines,'' 52 FR 10012 (March 27, 
1987)), unless it has granted a waiver or reduction of fees under 
Sec. 5.33 and subject to the limitations set forth in paragraph (b) of 
this section:
    (1) Search. The Department charges search fees, subject to the 
limitations of paragraph (b) of this section. Search time includes time 
spent searching, regardless of whether the search results in the 
location of responsive agency records and, if so, whether such agency 
records are released to the requester under the Act. The requester will 
be charged the direct costs, as defined in Sec. 5.31(b), of the search. 
In the case of computer searches for agency records, the Department 
charges the requester for the direct cost of conducting the search, 
subject to the limitations set forth in paragraph (b) of this section.
    (2) Review. (i) The Department charges fees for initial agency 
record review at the same rate as for searches, subject to the 
limitations set forth in paragraph (b) of this section.
    (ii) No fees are charged for review at the administrative appeal 
level except in connection with--
    (A) The review of agency records other than agency records 
identified as responsive to the FOIA request in the initial decision; 
and
    (B) The Department's decision regarding whether to assert that an 
exemption exists under the Act that was not cited in the decision on the 
initial FOIA request.
    (iii) Review fees are not assessed for FOIA requests other than 
those made for a ``commercial use,'' as the term is defined in 
Sec. 5.31(a).
    (3) Duplication. The Department charges duplication fees at the rate 
of $0.20 per page for paper photocopies of agency records, $3.00 per CD 
for documents recorded on CD, and at the direct cost for duplication for 
electronic copies and other forms of duplication, subject to the 
limitations of paragraph (b) of this section.
    (b) Limitations on fees.
    (1) Fees are limited to charges for document duplication when agency 
records are not sought for commercial use and the request is made by--
    (i) An educational or noncommercial scientific institution, whose 
purpose is scholarly or scientific research; or
    (ii) A representative of the news media.
    (2) For FOIA requests other than commercial use FOIA requests, the 
Department provides the first 100 pages of agency records released (or 
the cost equivalent) and the first two hours of search (or the cost 
equivalent) without charge, pursuant to 5 U.S.C. 552(a)(4)(A)(iv)(II).
    (3) Whenever the Department calculates that the fees assessable for 
a FOIA request under paragraph (a) of this section total $25.00 or less, 
the Department processes the FOIA request without charge to the 
requester.
    (c) Notice of anticipated fees in excess of $25. When the Department 
estimates or determines that the fees for processing a FOIA request will 
total more than $25 and the requester has not stated a willingness to 
pay such fees, the Department notifies the requester of

[[Page 14]]

the anticipated amount of fees before processing the FOIA request. If 
the Department can readily anticipate fees for processing only a portion 
of a request, the Department advises the requester that the anticipated 
fee is for processing only a portion of the request. When the Department 
has notified a requester of anticipated fees greater than $25, the 
Department does not further process the request until the requester 
agrees in writing to pay the anticipated total fee.
    (d) Charges for other services. When the Department chooses as a 
matter of administrative discretion to provide a special service, such 
as certification of agency records, it charges the requester the direct 
cost of providing the service.
    (e) Charging interest. The Department charges interest on any unpaid 
bill assessed at the rate provided in 31 U.S.C. 3717. In charging 
interest, the Department follows the provisions of the Debt Collection 
Act of 1982, as amended (Pub. L. 97-365), and its administrative 
procedures, including the use of consumer reporting agencies, collection 
agencies, and offset.
    (f) Aggregating FOIA requests. When the Department reasonably 
believes that a requester, or a group of requesters acting together, is 
attempting to divide a FOIA request into a series of FOIA requests for 
the purpose of avoiding or reducing otherwise applicable fees, the 
Department may aggregate such FOIA requests for the purpose of assessing 
fees. The Department does not aggregate multiple FOIA requests involving 
unrelated matters.
    (g) Advance payments.
    (1) For FOIA requests other than those described in paragraphs 
(g)(2) and (g)(3) of this section, the Department does not require the 
requester to pay fees in advance.
    (2) Where the Department estimates or determines that fees for 
processing a FOIA request will total more than $250, it may require the 
requester to pay the fees in advance, except where the Department 
receives a satisfactory assurance of full payment from a requester with 
a history of prompt payment of FOIA fees.
    (3) The Department may require a requester who has previously failed 
to pay a properly assessed FOIA fee within 30 calendar days of the 
billing date to pay in advance the full amount of estimated or actual 
fees before it further processes a new or pending FOIA request from that 
requester.
    (4) When the Department requires advance payment of estimated or 
assessed fees, it does not consider the FOIA request received and does 
not further process the FOIA request until payment is received.
    (h) Tolling. When necessary for the Department to clarify issues 
regarding fee assessment with the FOIA requester, the time limit for 
responding to the FOIA request is tolled until the Department resolves 
such issues with the requester.
    (i) Other statutory requirements. The fee schedule of this section 
does not apply to fees charged under any statute that specifically 
requires an agency to set and collect fees for producing particular 
types of agency records.

(Authority: 5 U.S.C. 552(a), 5 U.S.C. 552(a)(4)(A), 20 U.S.C. 3474)



Sec. 5.33  Requirements for waiver or reduction of fees.

    (a) The Department processes a FOIA request for agency records 
without charge or at a charge less than that established under 
Sec. 5.32(a) when the Department determines that--
    (1) Disclosure of the requested information is in the public 
interest because it is likely to contribute significantly to public 
understanding of the operations or activities of the government; and
    (2) Disclosure of the information is not primarily in the commercial 
interest of the requester.
    (b) To determine whether a FOIA request is eligible for waiver or 
reduction of fees pursuant to paragraph (a)(1) of this section, the 
Department considers the following factors:
    (1) Whether the subject of the request specifically concerns 
identifiable operations or activities of the government.
    (2) Whether the disclosable portions of the requested information 
will be meaningfully informative in relation to the subject matter of 
the request.
    (3) The disclosure's contribution to public understanding of 
government operations, i.e., the understanding of

[[Page 15]]

the public at large, as opposed to an individual or a narrow segment of 
interested persons (including whether the requester has expertise in the 
subject area of the FOIA request as well as the intention and 
demonstrated ability to disseminate the information to the public).
    (4) The significance of the disclosure's contribution to public 
understanding of government operations or activities, i.e., the public's 
understanding of the subject matter existing prior to the disclosure 
must be likely to be enhanced significantly by the disclosure.
    (c) To determine whether a FOIA request is eligible for waiver or 
reduction of fees pursuant to paragraph (a)(2) of this section, the 
Department considers the following factors:
    (1) The existence of the requester's commercial interest, i.e., 
whether the requester has a commercial interest that would be furthered 
by the requested disclosure.
    (2) If a commercial interest is identified, whether the commercial 
interest of the requester is sufficiently large in comparison with the 
public interest in disclosure, that disclosure is primarily in the 
commercial interest of the requester.
    (d) When the fee waiver requirements are met only with respect to a 
portion of a FOIA request, the Department waives or reduces fees only 
for that portion of the request.
    (e) A requester seeking a waiver or reduction of fees must submit 
evidence demonstrating that the FOIA request meets all the criteria 
listed in paragraphs (a) through (c) of this section.
    (f) A requester must seek a fee waiver for each FOIA request for 
which a waiver is sought. The Department does not grant standing fee 
waivers but considers each fee waiver request independently on its 
merits.

(Authority: 5 U.S.C. 552(a), 5 U.S.C. 552(a)(4)(A), 20 U.S.C. 3474)



                     Subpart E_Administrative Review



Sec. 5.40  Appeals of adverse determinations.

    (a) In general. A requester may seek an administrative review of an 
adverse determination on the FOIA request made by the requester by 
submitting an appeal of the determination to the Department. Adverse 
determinations include denials of access to agency records, in whole or 
in part; ``no agency records'' responses; and adverse fee decisions, 
including denials of requests for fee waivers, and all aspects of fee 
assessments.
    (b) Appeal requirements. A requester must submit an appeal within 35 
calendar days of the date on the adverse determination letter issued by 
the Department or, where the requester has received no determination, at 
any time after the due date for such determination. An appeal must be in 
writing and must include a detailed statement of all legal and factual 
bases for the appeal. The requester's failure to comply with time limits 
set forth in this section constitutes exhaustion of the requester's 
administrative remedies for the purposes of initiating judicial action 
to compel disclosure.
    (c) Determination on appeal. (1) The Department makes a written 
determination on an administrative appeal within 20 working days after 
receiving the appeal. The time limit may be extended in accordance with 
Sec. 5.21(c) through (e). The Department's failure to comply with time 
limits set forth in this section constitutes exhaustion of the 
requester's administrative remedies for the purposes of initiating 
judicial action to compel disclosure.
    (2) The Department's determination on an appeal constitutes the 
Department's final action on the FOIA request. Any Department 
determination denying an appeal in whole or in part includes the reasons 
for the denial, including any exemptions asserted under the Act, and 
notice of the requester's right to seek judicial review of the 
determination in accordance with 5 U.S.C. 552(a)(4). Where the 
Department makes a determination to grant an appeal in whole or in part, 
it processes the FOIA request subject to the appeal in accordance with 
the determination on appeal.

(Authority: 5 U.S.C. 552(a), 5 U.S.C. 552(a)(6), 20 U.S.C. 3474)

[[Page 16]]



PART 5b_PRIVACY ACT REGULATIONS--Table of Contents



Sec.
5b.1  Definitions.
5b.2  Purpose and scope.
5b.3  Policy.
5b.4  Maintenance of records.
5b.5  Notification of or access to records.
5b.7  Procedures for correction or amendment of records.
5b.8  Appeals of refusals to correct or amend records.
5b.9  Disclosure of records.
5b.10  Parents and guardians.
5b.11  Exempt systems.
5b.12  Contractors.
5b.13  Fees.

Appendix A to Part 5b--Employee Standards of Conduct
Appendix B to Part 5b--Routine Uses Applicable to More Than One System 
          of Records Maintained by ED

    Authority: 5 U.S.C. 301, 5 U.S.C. 552a.

    Source: 45 FR 30808, May 9, 1980, unless otherwise noted.



Sec. 5b.1  Definitions.

    As used in this part:
    (a) Access means availability of a record to a subject individual.
    (b) Agency means the Department of Education.
    (c) Department means the Department of Education.
    (d) Disclosure means the availability or release of a record to 
anyone other than the subject individual.
    (e) Individual means a living person who is a citizen of the United 
States or an alien lawfully admitted for permanent residence. It does 
not include persons such as sole proprietorships, partnerships, or 
corporations. A business firm which is identified by the name of one or 
more persons is not an individual within the meaning of this part.
    (f) Maintain means to maintain, collect, use, or disseminate when 
used in connection with the term ``record''; and, to have control over 
or responsibility for a system of records when used in connection with 
the term ``system of records.''
    (g) Notification means communication to an individual whether he is 
a subject individual.
    (h) Record means any item, collection, or grouping of information 
about an individual that is maintained by the Department, including but 
not limited to the individual's education, financial transactions, 
medical history, and criminal or employment history and that contains 
his name, or an identifying number, symbol, or other identifying 
particular assigned to the individual, such as a finger or voice print 
or a photograph. When used in this part, record means only a record 
which is in a system of records.
    (i) Responsible Department official means that officer who is listed 
in a notice of a system of records as the system manager for a given 
system of records or another individual listed in the notice of a system 
of records to whom requests may be made, or the designee of either such 
officer or individual.
    (j) Routine use means the disclosure of a record outside the 
Department, without the consent of the subject individual, for a purpose 
which is compatible with the purpose for which the record was collected. 
It includes disclosures required to be made by statute other than the 
Freedom of Information Act, 5 U.S.C. 552. It does not include 
disclosures which are permitted to be made without the consent of the 
subject individual which are not compatible with the purpose for which 
it was collected such as disclosures to the Bureau of the Census, the 
General Accounting Office, or to Congress.
    (k) Secretary means the Secretary of Education.
    (l) Statistical record means a record maintained for statistical 
research or reporting purposes only and not maintained to make 
determinations about a particular subject individual.
    (m) Subject individual means that individual to whom a record 
pertains.
    (n) System of records means any group of records under the control 
of the Department from which a record is retrieved by personal 
identifier such as the name of the individual, number, symbol or other 
unique retriever assigned to the individual. Single records or groups of 
records which are not retrieved by a personal identifier are not part of 
a system of records. Papers maintained by individual employees of the 
Department which are prepared, maintained, or discarded at the 
discretion of the employee and which are not

[[Page 17]]

subject to the Federal Records Act, 44 U.S.C. 2901, are not part of a 
system of records; Provided, That such personal papers are not used by 
the employee or the Department to determine any rights, benefits, or 
privileges of individuals.

[45 FR 30808, May 9, 1980; 45 FR 37426, June 3, 1980]



Sec. 5b.2  Purpose and scope.

    (a) This part implements section 3 of the Privacy Act of 1974, 5 
U.S.C. 552a (hereinafter referred to as the Act), by establishing agency 
policies and procedures for the maintenance of records. This part also 
establishes agency policies and procedures under which a subject 
individual may be given notification of or access to a record pertaining 
to him and policies and procedures under which a subject individual may 
have his record corrected or amended if he believes that his record is 
not accurate, timely, complete, or relevant or necessary to accomplish a 
Department function.
    (b) All components of the Department are governed by the provisions 
of this part. Also governed by the provisions of this part are advisory 
committees and councils within the meaning of the Federal Advisory 
Committee Act which provide advice to (1) any official or component of 
the Department or (2) the President and for which the Department has 
been delegated responsibility for providing services.
    (c) Employees of the Department governed by this part include all 
regular and special government employees of the Department; experts and 
consultants whose temporary (not in excess of 1 year) or intermittent 
services have been procured by the Department by contract pursuant to 
3109 of title 5, United States Code; volunteers where acceptance of 
their services are authorized by law; those individuals performing 
gratuitous services as permitted under conditions prescribed by the 
Office of Personnel Management; and, participants in work-study or 
training programs.
    (d) This part does not:
    (1) Make available to a subject individual records which are not 
retrieved by that individual's name or other personal identifier.
    (2) Make available to the general public records which are retrieved 
by a subject individual's name or other personal identifier or make 
available to the general public records which would otherwise not be 
available to the general public under the Freedom of Information Act, 5 
U.S.C. 552, and part 5 of this title.
    (3) Govern the maintenance or disclosure of, notification of or 
access to, records in the possession of the Department which are subject 
to regulations of another agency, such as personnel records subject to 
the regulations of the Office of Personnel Management.
    (4) Apply to grantees, including State and local governments or 
subdivisions thereof, administering federally funded programs.
    (5) Make available records compiled by the Department in reasonable 
anticipation of court litigation or formal administrative proceedings. 
The availability of such records to the general public or to any subject 
individual or party to such litigation or proceedings shall be governed 
by applicable constitutional principles, rules of discovery, and 
applicable regulations of the Department.



Sec. 5b.3  Policy.

    It is the policy of the Department to protect the privacy of 
individuals to the fullest extent possible while nonetheless permitting 
the exchange of records required to fulfill the administrative and 
program responsibilities of the Department, and responsibilities of the 
Department for disclosing records which the general public is entitled 
to have under the Freedom of Information Act, 5 U.S.C. 552, and part 5 
of this title.



Sec. 5b.4  Maintenance of records.

    (a) No record will be maintained by the Department unless:
    (1) It is relevant and necessary to accomplish a Department function 
required to be accomplished by statute or Executive Order;
    (2) It is acquired to the greatest extent practicable from the 
subject individual when maintenance of the record may result in a 
determination about the subject individual's rights, benefits or 
privileges under Federal programs;

[[Page 18]]

    (3) The individual providing the record is informed of the authority 
for providing the record (including whether the providing of the record 
is mandatory or voluntary, the principal purpose for maintaining the 
record, the routine uses for the record, what effect his refusal to 
provide the record may have on him), and if the record is not required 
by statute or Executive Order to be provided by the individual, he 
agrees to provide the record.
    (b) No record will be maintained by the Department which describes 
how an individual exercises rights guaranteed by the First Amendment 
unless expressly authorized (1) by statute, or (2) by the subject 
individual, or (3) unless pertinent to and within the scope of an 
authorized law enforcement activity.



Sec. 5b.5  Notification of or access to records.

    (a) Times, places, and manner of requesting notification of or 
access to a record. (1) Any individual may request notification of a 
record. He may at the same time request access to any record pertaining 
to him. An individual may be accompanied by another individual of his 
choice when he requests access to a record in person; Provided, That he 
affirmatively authorizes the presence of such other individual during 
any discussion of a record to which access is requested.
    (2) An individual making a request for notification of or access to 
a record shall address his request to the responsible Department 
official and shall verify his identity when required in accordance with 
paragraph (b)(2) of this section. At the time the request is made, the 
individual shall specify which systems of records he wishes to have 
searched and the records to which he wishes to have access. He may also 
request that copies be made of all or any such records. An individual 
shall also provide the responsible Department official with sufficient 
particulars to enable such official to distinguish between records on 
subject individuals with the same name. The necessary particulars are 
set forth in the notices of systems of records.
    (3) An individual who makes a request in person may leave with any 
responsible Department official a request for notification of or access 
to a record under the control of another responsible Department 
official; Provided, That the request is addressed in writing to the 
appropriate responsible Department official.
    (b) Verification of identity--(1) When required. Unless an 
individual, who is making a request for notification of or access to a 
record in person, is personally known to the responsible Department 
official, he shall be required to verify his identity in accordance with 
paragraph (b)(2) of this section if:
    (i) He makes a request for notification of a record and the 
responsible Department official determines that the mere disclosure of 
the existence of the record would be a clearly unwarranted invasion of 
privacy if disclosed to someone other than the subject individual; or,
    (ii) He makes a request for access to a record which is not required 
to be disclosed to the general public under the Freedom of Information 
Act, 5 U.S.C. 552, and part 5 of this title.
    (2) Manner of verifying identity. (i) An individual who makes a 
request in person shall provide to the responsible Department official 
at least one piece of tangible identification such as a driver's 
license, passport, alien or voter registration card, or union card to 
verify his identity. If an individual does not have identification 
papers to verify his identity, he shall certify in writing that he is 
the individual who he claims to be and that he understands that the 
knowing and willful request for or acquisition of a record pertaining to 
an individual under false pretenses is a criminal offense under the Act 
subject to a $5,000 fine.
    (ii) Except as provided in paragraph (b)(2)(v) of this section, an 
individual who does not make a request in person shall submit a 
notarized request to the responsible Department official to verify his 
identity or shall certify in his request that he is the individual who 
he claims to be and that he understands that the knowing and willful 
request for or acquisition of a record pertaining to an individual under 
false pretenses is a criminal offense under the Act subject to a $5,000 
fine.

[[Page 19]]

    (iii) An individual who makes a request on behalf of a minor or 
legal incompetent as authorized under Sec. 5b.10 of this part shall 
verify his relationship to the minor or legal incompetent, in addition 
to verifying his own identity, by providing a copy of the minor's birth 
certificate, a court order, or other competent evidence of guardianship 
to the responsible Department official; except that, an individual is 
not required to verify his relationship to the minor or legal 
incompetent when he is not required to verify his own identity or when 
evidence of his relationship to the minor or legal incompetent has been 
previously given to the responsible Department official.
    (iv) An individual shall further verify his identity if he is 
requesting notification of or access to sensitive records. Any further 
verification shall parallel the record to which notification or access 
is being sought. Such further verification may include such particulars 
as the individual's years of attendance at a particular educational 
institution, rank attained in the uniformed services, date or place of 
birth, names of parents, or an occupation.
    (v) An individual who makes a request by telephone shall verify his 
identity by providing to the responsible Department official identifying 
particulars which parallel the record to which notification or access is 
being sought. If the responsible Department official determines that the 
particulars provided by telephone are insufficient, the requester will 
be required to submit the request in writing or in person. Telephone 
requests will not be accepted where an individual is requesting 
notification of or access to sensitive records.
    (c) Granting notification of or access to a record. (1) Subject to 
the provisions governing exempt systems in Sec. 5b.11 of this part, a 
responsible Department official, who receives a request for notification 
of or access to a record and, if required, verification of an 
individual's identity, will review the request and grant notification or 
access to a record, if the individual requesting access to the record is 
the subject individual.
    (2) If the responsible Department official determines that there 
will be a delay in responding to a request because of the number of 
requests being processed, a breakdown of equipment, shortage of 
personnel, storage of records in other locations, etc., he will so 
inform the individual and indicate when notification or access will be 
granted.
    (3) Prior to granting notification of or access to a record, the 
responsible Department official may at his discretion require an 
individual making a request in person to reduce his request to writing 
if the individual has not already done so at the time the request is 
made.



Sec. 5b.7  Procedures for correction or amendment of records.

    (a) Any subject individual may request that his record be corrected 
or amended if he believes that the record is not accurate, timely, 
complete, or relevant or necessary to accomplish a Department function. 
A subject individual making a request to amend or correct his record 
shall address his request to the responsible Department official in 
writing; except that, the request need not be in writing if the subject 
individual makes his request in person and the responsible Department 
official corrects or amends the record at that time. The subject 
individual shall specify in each request:
    (1) The system of records from which the record is retrieved;
    (2) The particular record which he is seeking to correct or amend;
    (3) Whether he is seeking an addition to or a deletion or 
substitution of the record; and,
    (4) His reasons for requesting correction or amendment of the 
record.
    (b) A request for correction or amendment of a record will be 
acknowledged within 10 working days of its receipt unless the request 
can be processed and the subject individual informed of the responsible 
Department official's decision on the request within that 10 day period.
    (c) If the responsible Department official agrees that the record is 
not accurate, timely, or complete based on a preponderance of the 
evidence, the record will be corrected or amended. The record will be 
deleted without regard to its accuracy, if the record is

[[Page 20]]

not relevant or necessary to accomplish the Department function for 
which the record was provided or is maintained. In either case, the 
subject individual will be informed in writing of the correction, 
amendment, or deletion and, if accounting was made of prior disclosures 
of the record, all previous recipients of the record will be informed of 
the corrective action taken.
    (d) If the responsible Department official does not agree that the 
record should be corrected or amended, the subject individual will be 
informed in writing of the refusal to correct or amend the record. He 
will also be informed that he may appeal the refusal to correct or amend 
his record Sec. 5b.8 of this part.
    (e) Requests to correct or amend a record governed by the regulation 
of another government agency, e.g., Office of Personnel Management, 
Federal Bureau of Investigation, will be forwarded to such government 
agency for processing and the subject individual will be informed in 
writing of the referral.



Sec. 5b.8  Appeals of refusals to correct or amend records.

    (a) Processing the appeal. (1) A subject individual who disagrees 
with a refusal to correct or amend his record may appeal the refusal in 
writing. All appeals shall be made to the Secretary.
    (2) An appeal will be completed within 30 working days from its 
receipt by the appeal authority; except that, the appeal authority may 
for good cause extend this period for an additional 30 days. Should the 
appeal period be extended, the subject individual appealing the refusal 
to correct or amend the record will be informed in writing of the 
extension and the circumstances of the delay. The subject individual's 
request to amend or correct the record, the responsible Department 
official's refusal to correct or amend, and any other pertinent material 
relating to the appeal will be reviewed. No hearing will be held.
    (3) If the appeal authority agrees that the record subject to the 
appeal should be corrected or amended, the record will be amended and 
the subject individual will be informed in writing of the correction or 
amendment. Where an accounting was made of prior disclosures of the 
record, all previous recipients of the record will be informed of the 
corrective action taken.
    (4) If the appeal is denied, the subject individual will be informed 
in writing:
    (i) Of the denial and the reasons for the denial;
    (ii) That he has a right to seek judicial review of the denial; and,
    (iii) That he may submit to the responsible Department official a 
concise statement of disagreement to be associated with the disputed 
record and disclosed whenever the record is disclosed.
    (b) Notation and disclosure of disputed records. Whenever a subject 
individual submits a statement of disagreement to the responsible 
Department official in accordance with paragraph (a)(4)(iii) of this 
section, the record will be noted to indicate that it is disputed. In 
any subsequent disclosure, a copy of the subject individual's statement 
of disagreement, will be disclosed with the record. If the responsible 
Department official deems it appropriate, a concise statement of the 
appeal authority's reasons for denying the subject individual's appeal 
may also be disclosed with the record. While the subject individual will 
have access to this statement of reasons, such statement will not be 
subject to correction or amendment. Where an accounting was made of 
prior disclosures of the record, all previous recipients of the record 
will be provided a copy of the subject individual's statement of 
disagreement, as well as the statement, if any, of the appeal 
authority's reasons for denying the subject individual's appeal.



Sec. 5b.9  Disclosure of records.

    (a) Consent to disclosure by a subject individual. (1) Except as 
provided in paragraph (b) of this section authorizing disclosures of 
records without consent, no disclosure of a record will be made without 
the consent of the subject individual. In each case the consent, whether 
obtained from the subject individual at the request of the Department or 
whether provided to the Department by the subject individual on his own 
initiative, shall be in writing. The consent shall specify the 
individual, organizational unit or class of individuals or 
organizational units to

[[Page 21]]

whom the record may be disclosed, which record may be disclosed and, 
where applicable, during which time frame the record may be disclosed 
(e.g., during the school year, while the subject individual is out of 
the country, whenever the subject individual is receiving specific 
services). A blanket consent to disclose all of a subject individual's 
records to unspecified individuals or organizational units will not be 
honored. The subject individual's identity and, where applicable (e.g., 
where a subject individual gives consent to disclosure of a record to a 
specific individual), the identity of the individual to whom the record 
is to be disclosed shall be verified.
    (2) A parent or guardian of any minor is not authorized to give 
consent to a disclosure of the minor's medical record.
    (b) Disclosures without the consent of the subject individual. The 
disclosures listed in this paragraph may be made without the consent of 
the subject individual. Such disclosures are:
    (1) To those officers and employees of the Department who have a 
need for the record in the performance of their duties. The responsible 
Department official may upon request of any officer or employee, or on 
his own initiative, determine what constitutes legitimate need.
    (2) Required to be disclosed under the Freedom of Information Act, 5 
U.S.C. 552, and part 5 of this title.
    (3) For a routine use as defined in paragraph (j) of Sec. 5b.1. 
Routine uses will be listed in any notice of a system of records. 
Routine uses published in appendix B are applicable to more than one 
system of records. Where applicable, notices of systems of records may 
contain references to the routine uses listed in appendix B. appendix B 
will be published with any compendium of notices of systems of records.
    (4) To the Bureau of the Census for purposes of planning or carrying 
out a census or survey or related activity pursuant to the provisions of 
title 13 U.S.C.
    (5) To a recipient who has provided the agency with advance written 
assurance that the record will be used solely as a statistical research 
or reporting record; Provided, That, the record is transferred in a form 
that does not identify the subject individual.
    (6) To the National Archives of the United States as a record which 
has sufficient historical or other value to warrant its continued 
preservation by the United States Government, or for evaluation by the 
Administrator of General Services or his designee to determine whether 
the record has such value.
    (7) To another government agency or to an instrumentality of any 
governmental jurisdiction within or under the control of the United 
States for a civil or criminal law enforcement activity if the activity 
is authorized by law, and if the head of such government agency or 
instrumentality has submitted a written request to the Department 
specifying the record desired and the law enforcement activity for which 
the record is sought.
    (8) To an individual pursuant to a showing of compelling 
circumstances affecting the health or safety of any individual if a 
notice of the disclosure is transmitted to the last known address of the 
subject individual.
    (9) To either House of Congress, or to the extent of matter within 
its jurisdiction, any committee or subcommittee thereof, any joint 
committee of Congress or subcommittee of any such joint committee.
    (10) To the Comptroller General, or any of the Comptroller General's 
authorized representatives, in the course of the performance of the 
duties of the General Accounting Office.
    (11) Pursuant to the order of a court of competent jurisdiction.
    (c) Accounting of disclosures. (1) An accounting of all disclosures 
of a record will be made and maintained by the Department for 5 years or 
for the life of the record, whichever is longer; except that, such an 
accounting will not be made:
    (i) For disclosures under paragraphs (b) (1) and (2) of this 
section; and,
    (ii) For disclosures made with the written consent of the subject 
individual.
    (2) The accounting will include:
    (i) The date, nature, and purpose of each disclosure; and

[[Page 22]]

    (ii) The name and address of the person or entity to whom the 
disclosure is made.
    (3) Any subject individual may request access to an accounting of 
disclosures of a record. The subject individual shall make a request for 
access to an accounting in accordance with the procedures in Sec. 5b.5 
of this part. A subject individual will be granted access to an 
accounting of the disclosures of a record in accordance with the 
procedures of this part which govern access to the related record. 
Access to an accounting of a disclosure of a record made under paragraph 
(b)(7) of this section may be granted at the discretion of the 
responsible Department official.



Sec. 5b.10  Parents and guardians.

    For the purpose of this part, a parent or guardian of any minor or 
the legal guardian or any individual who has been declared incompetent 
due to physical or mental incapacity or age by a court of competent 
jurisdiction is authorized to act on behalf of an individual or a 
subject individual. Except as provided in paragraph (b)(2) of Sec. 5b.5, 
of this part governing procedures for verifying an individual's 
identity, an individual authorized to act on behalf of a minor or legal 
incompetent will be viewed as if he were the individual or subject 
individual.



Sec. 5b.11  Exempt systems.

    (a) General policy. The Act permits an agency to exempt certain 
types of systems of records from some of the Act's requirements. It is 
the policy of the Department to exercise authority to exempt systems of 
records only in compelling cases.
    (b) Specific systems of records exempted under (j)(2). The 
Department exempts the Investigative Files of the Inspector General ED/
OIG (18-10-01) and the Hotline Complaint Files of the Inspector General 
ED/OIG (18-10-04) systems of records from the following provisions of 5 
U.S.C. 552a and this part:
    (1) 5 U.S.C. 552a(c)(3) and Sec. 5b.9(a)(1) and (c)(3) of this part, 
regarding access to an accounting of disclosures of a record.
    (2) 5 U.S.C. 552a(c)(4) and Secs. 5b.7(c) and 5b.8(b) of this part, 
regarding notification to outside parties and agencies of correction or 
notation of dispute made in accordance with 5 U.S.C. 552a(d).
    (3) 5 U.S.C. 552a(d) (1) through (4) and (f) and Secs. 5b.5(a)(1) 
and (c), 5b.7, and 5b.8 of this part, regarding notification or access 
to records and correction or amendment of records.
    (4) 5 U.S.C. 552a(e)(1) and Sec. 5b.4(a)(1) of this part, regarding 
maintaining only relevant and necessary information.
    (5) 5 U.S.C. 552a(e)(2) and Sec. 5b.4(a)(2) of this part, regarding 
collection of information from the subject individual.
    (6) 5 U.S.C. 552a(e)(3) and Sec. 5b.4(a)(3) of this part, regarding 
notice to individuals asked to provide information to the Department.
    (7) 5 U.S.C. 552a(e)(4) (G), (H), and (I), regarding inclusion of 
information in the system notice about procedures for notification, 
access, correction, and source of records.
    (8) 5 U.S.C. 552a(e)(5), regarding maintaining records with 
requisite accuracy, relevance, timeliness, and completeness.
    (9) 5 U.S.C. 552a(e)(8), regarding service of notice on subject 
individual if a record is made available under compulsory legal process 
if that process becomes a matter of public record.
    (10) 5 U.S.C. 552a(g), regarding civil remedies for violation of the 
Privacy Act.
    (c) Specific systems of records exempted under (k)(2). (1) The 
Department exempts the Investigative Files of the Inspector General ED/
OIG (18-10-01), the Hotline Complaint Files of the Inspector General ED/
OIG (18-10-04), and the Office of Inspector General Data Analytics 
System (ODAS) (18-10-02) from the following provisions of 5 U.S.C. 552a 
and this part to the extent that these systems of records consist of 
investigatory material and complaints that may be included in 
investigatory material compiled for law enforcement purposes:
    (i) 5 U.S.C. 552a(c)(3) and Sec. 5b.9(c)(3) of this part, regarding 
access to an accounting of disclosures of records.
    (ii) 5 U.S.C. 552a(d) (1) through (4) and (f) and Secs. 5b.5(a)(1) 
and (c), 5b.7, and 5b.8 of this part, regarding notification of and 
access to records and correction or amendment of records.
    (iii) 5 U.S.C. 552a(e)(1) and Sec. 5b.4(a)(1) of this part, 
regarding the requirement

[[Page 23]]

to maintain only relevant and necessary information.
    (iv) 5 U.S.C. 552a(e)(4) (G), (H), and (I), regarding inclusion of 
information in the system notice about procedures for notification, 
access, correction, and source of records.
    (2) The Department exempts the Complaint Files and Log, Office for 
Civil Rights (18-08-01) from the following provisions of 5 U.S.C. 552a 
and this part:
    (i) 5 U.S.C. 552a(c)(3) and Sec. 5b.9(c)(3) of this part, regarding 
access to an accounting of disclosures of records.
    (ii) 5 U.S.C. 552a(d) (1) through (4) and (f) and Secs. 5b.5(a)(1) 
and (c), 5b.7, and 5b.8 of this part, regarding notification of and 
access to records and correction or amendment of records.
    (iii) 5 U.S.C. 552a(e)(4) (G) and (H), regarding inclusion of 
information in the system notice about procedures for notification, 
access, and correction of records.
    (d) Specific systems of records exempted under (k)(5). The 
Department exempts the Investigatory Material Compiled for Personnel 
Security and Suitability Purposes (18-05-17) system of records from the 
following provisions of 5 U.S.C. 552a and this part:
    (1) 5 U.S.C. 552a(c)(3) and Sec. 5b.9(c)(3) of this part, regarding 
access to an accounting of disclosures of records.
    (2) 5 U.S.C. 552a(d) (1) through (4) and (f) and Secs. 5b.5(a)(1) 
and (c), 5b.7, and 5b.8 of this part, regarding notification of and 
access to records and correction or amendment of records.
    (3) 5 U.S.C. 552a(e)(4) (G) and (H), regarding inclusion of 
information in the system notice about procedures for notification, 
access, and correction of records.
    (e) Basis for exemptions taken under (j)(2), (k)(2), and (k)(5). The 
reason the Department took each exemption described in this section is 
stated in the preamble for the final rulemaking document under which the 
exemption was promulgated. These final rulemaking documents were 
published in the Federal Register and may be obtained from the 
Department of Education by mailing a request to the following address: 
U.S. Department of Education, Privacy Act Officer, Office of the Chief 
Information Officer, Regulatory Information Management Group, 
Washington, DC 20202-4651.
    (f) Notification of or access to records in exempt systems of 
records. (1) If a system of records is exempt under this section, an 
individual may nonetheless request notification of or access to a record 
in that system. An individual shall make requests for notification of or 
access to a record in an exempt system or records in accordance with the 
procedures of Sec. 5b.5 of this part.
    (2) An individual will be granted notification of or access to a 
record in an exempt system but only to the extent that notification or 
access would not reveal the identity of a source who furnished the 
record to the Department under an express promise, and, prior to 
September 27, 1975, an implied promise, that his identity would be held 
in confidence if--
    (i) The record is in a system of records or that portion of a system 
of records that is exempt under subsection (k)(2), but not under 
subsection (j)(2), of the Act and the individual has been, as a result 
of the maintenance of the record, denied a right, privilege, or benefit 
to which he or she would otherwise be eligible; or
    (ii) The record is in a system of records that is exempt under 
subsection (k)(5) of the Act.
    (3) If an individual is not granted notification of or access to a 
record in a system of records exempt under subsections (k)(2) (but not 
under subsection (j)(2)) and (k)(5) of the Act in accordance with this 
paragraph, he or she will be informed that the identity of a 
confidential source would be revealed if notification of or access to 
the record were granted to the individual.
    (g) Discretionary actions by the responsible Department official. 
Unless disclosure of a record to the general public is otherwise 
prohibited by law, the responsible Department official may, in his or 
her discretion, grant notification of or access to a record in a system 
of records that is exempt under this section. Discretionary notification 
of or access to a record in accordance with this paragraph will not be a 
precedent for discretionary notification of or access to a similar or 
related record and

[[Page 24]]

will not obligate the responsible Department official to exercise his or 
her discretion to grant notification of or access to any other record in 
a system of records that is exempt under this section.

[58 FR 44424, Aug. 20, 1993, as amended at 64 FR 31066, June 9, 1999; 69 
FR 12246, Mar. 15, 2004; 73 FR 61355, Oct. 16, 2008]



Sec. 5b.12  Contractors.

    (a) All contracts entered into on or after September 27, 1975 which 
require a contractor to maintain or on behalf of the Department to 
maintain, a system of records to accomplish a Department function must 
contain a provision requiring the contractor to comply with the Act and 
this part.
    (b) All unexpired contracts entered into prior to September 27, 1975 
which require the contractor to maintain or on behalf of the Department 
to maintain, a system of records to accomplish a Department function 
will be amended as soon as practicable to include a provision requiring 
the contractor to comply with the Act and this part. All such contracts 
must be so amended by July 1, 1976 unless for good cause the appeal 
authority identified in Sec. 5b.8 of this part authorizes the 
continuation of the contract without amendment beyond that date.
    (c) A contractor and any employee of such contractor shall be 
considered employees of the Department only for the purposes of the 
criminal penalties of the Act, 5 U.S.C. 552a(i), and the employee 
standards of conduct listed in appendix A of this part where the 
contract contains a provision requiring the contractor to comply with 
the Act and this part.
    (d) This section does not apply to systems of records maintained by 
a contractor as a result of his management discretion, e.g., the 
contractor's personnel records.



Sec. 5b.13  Fees.

    (a) Policy. Where applicable, fees for copying records will be 
charged in accordance with the schedule set forth in this section. Fees 
may only be charged where an individual requests that a copy be made of 
the record to which he is granted access. No fee may be charged for 
making a search of the system of records whether the search is manual, 
mechanical, or electronic. Where a copy of the record must be made in 
order to provide access to the record (e.g., computer printout where no 
screen reading is available), the copy will be made available to the 
individual without cost.
    (b) Fee schedule. The fee schedule for the Department is as follows:
    (1) Copying of records susceptible to photocopying--$.10 per page.
    (2) Copying records not susceptible to photocopying (e.g., punch 
cards or magnetic tapes)--at actual cost to be determined on a case-by-
case basis.
    (3) No charge will be made if the total amount of copying does not 
exceed $25.



        Sec. Appendix A to Part 5b--Employee Standards of Conduct

    (a) General. All employees are required to be aware of their 
responsibilities under the Privacy Act of 1974, 5 U.S.C. 552a. 
Regulations implementing the Act are set forth in 34 CFR 5b. Instruction 
on the requirements of the Act and regulation shall be provided to all 
new employees of the Department. In addition, supervisors shall be 
responsible for assuring that employees who are working with systems of 
records or who undertake new duties which require the use of systems of 
records are informed of their responsibilities. Supervisors shall also 
be responsible for assuring that all employees who work with such 
systems of records are periodically reminded of the requirements of the 
Act and are advised of any new provisions or interpretations of the Act.
    (b) Penalties. (1) All employees must guard against improper 
disclosure of records which are governed by the Act. Because of the 
serious consequences of improper invasions of personal privacy, 
employees may be subject to disciplinary action and criminal prosecution 
for knowing and willful violations of the Act and regulation. In 
addition, employees may also be subject to disciplinary action for 
unknowing or unwillful violations, where the employee had notice of the 
provisions of the Act and regulations and failed to inform himself 
sufficiently or to conduct himself in accordance with the requirements 
to avoid violations.
    (2) The Department may be subjected to civil liability for the 
following actions undertaken by its employees:
    (a) Making a determination under the Act and Secs. 5b.7 and 5b.8 of 
the regulation not to amend an individual's record in accordance with 
his request, or failing to make such review in conformity with those 
provisions;

[[Page 25]]

    (b) Refusing to comply with an individual's request for notification 
of or access to a record pertaining to him;
    (c) Failing to maintain any record pertaining to any individual with 
such accuracy, relevance, timeliness, and completeness as is necessary 
to assure fairness in any determination relating to the qualifications, 
character, rights, or opportunities of, or benefits to the individual 
that may be made on the basis of such a record, and consequently a 
determination is made which is adverse to the individual; or
    (d) Failing to comply with any other provision of the Act or any 
rule promulgated thereunder, in such a way as to have an adverse effect 
on an individual.
    (3) ``An employee may be personally subject to criminal liability as 
set forth below and in 5 U.S.C. 552a (i):
    (a) Any officer or employee of an agency, who by virtue of his 
employment or official position, has possession of, or access to, agency 
records which contain individually identifiable information the 
disclosure of which is prohibited by the Act or by rules or regulations 
established thereunder, and who, knowing that disclosure of the specific 
material is so prohibited, willfully discloses the material in any 
manner to any person or agency not entitled to receive it, shall be 
guilty of a misdemeanor and fined not more than $5,000.''
    (b) ``Any officer or employee of any agency who willfully maintains 
a system of records without meeting the notice requirements [of the Act] 
shall be guilty of a misdemeanor and fined not more than $5,000.''
    (c) Rules Governing Employees Not Working With Systems of Records. 
Employees whose duties do not involve working with systems of records 
will not generally disclose to any one, without specific authorization 
from their supervisors, records pertaining to employees or other 
individuals which by reason of their official duties are available to 
them. Notwithstanding the above, the following records concerning 
Federal employees are a matter of public record and no further 
authorization is necessary for disclosure:
    (1) Name and title of individual.
    (2) Grade classification or equivalent and annual rate of salary.
    (3) Position description.
    (4) Location of duty station, including room number and telephone 
number.

In addition, employees shall disclose records which are listed in the 
Department's Freedom of Information Regulation as being available to the 
public. Requests for other records will be referred to the responsible 
Department official. This does not preclude employees from discussing 
matters which are known to them personally, and without resort to a 
record, to official investigators of Federal agencies for official 
purposes such as suitability checks, Equal Employment Opportunity 
investigations, adverse action proceedings, grievance proceedings, etc.
    (d) Rules governing employees whose duties require use or reference 
to systems of records. Employees whose official duties require that they 
refer to, maintain, service, or otherwise deal with systems of records 
(hereinafter referred to as ``Systems Employees'') are governed by the 
general provisions. In addition, extra precautions are required and 
systems employees are held to higher standards of conduct.
    (1) Systems Employees shall:
    (a) Be informed with respect to their responsibilities under the 
Act;
    (b) Be alert to possible misuses of the system and report to their 
supervisors any potential or actual use of the system which they believe 
is not in compliance with the Act and regulation;
    (c) Make a disclosure of records within the Department only to an 
employee who has a legitimate need to know the record in the course of 
his official duties;
    (d) Maintain records as accurately as practicable.
    (e) Consult with a supervisor prior to taking any action where they 
are in doubt whether such action is in conformance with the Act and 
regulation.
    (2) Systems Employees shall not:
    (a) Disclose in any form records from a system of records except (1) 
with the consent or at the request of the subject individual; or (2) 
where its disclosure is permitted under Sec. 5b.9 of the regulation.
    (b) Permit unauthorized individuals to be present in controlled 
areas. Any unauthorized individuals observed in controlled areas shall 
be reported to a supervisor or to the guard force.
    (c) Knowingly or willfully take action which might subject the 
Department to civil liability.
    (d) Make any arrangements for the design development, or operation 
of any system of records without making reasonable effort to provide 
that the system can be maintained in accordance with the Act and 
regulation.
    (e) Contracting officers. In addition to any applicable provisions 
set forth above, those employees whose official duties involve entering 
into contracts on behalf of the Department shall also be governed by the 
following provisions:
    (1) Contracts for design, or development of systems and equipment. 
No contract for the design or development of a system of records, or for 
equipment to store, service or maintain a system of records shall be 
entered into unless the contracting officer has made reasonable effort 
to ensure that the product to be purchased is capable of being used 
without violation of the Act or regulation. Special attention shall be 
given to provision of physical safeguards.

[[Page 26]]

    (2) Contracts for the operation of systems and equipment. No 
contract for the design or development of a system of whom he feels 
appropriate, of all proposed contracts providing for the operation of 
systems of records shall be made prior to execution of the contracts to 
determine whether operation of the system of records is for the purpose 
of accomplishing a Department function. If a determination is made that 
the operation of the system is to accomplish a Department function, the 
contracting officer shall be responsible for including in the contract 
appropriate provisions to apply the provisions of the Act and regulation 
to the system, including prohibitions against improper release by the 
contractor, his employees, agents, or subcontractors.
    (3) Other service contracts. Contracting officers entering into 
general service contracts shall be responsible for determining the 
appropriateness of including provisions in the contract to prevent 
potential misuse (inadvertent or otherwise) by employees, agents, or 
subcontractors of the contractor.
    (f) Rules Governing Responsible Department Officials. In addition to 
the requirements for Systems Employees, responsible Department officials 
shall:
    (1) Respond to all requests for notification of or access, 
disclosure, or amendment of records in a timely fashion in accordance 
with the Act and regulation;
    (2) Make any amendment of records accurately and in a timely 
fashion;
    (3) Inform all persons whom the accounting records show have 
received copies of the record prior to the amendments of the correction; 
and
    (4) Associate any statement of disagreement with the disputed 
record, and
    (a) Transmit a copy of the statement to all persons whom the 
accounting records show have received a copy of the disputed record, and
    (b) Transmit that statement with any future disclosure.



  Sec. Appendix B to Part 5b--Routine Uses Applicable to More Than One 
                   System of Records Maintained by ED

    (1) In the event that a system of records maintained by this agency 
to carry out its functions indicates a violation or potential violation 
of law, whether civil, criminal or regulatory in nature, and whether 
arising by general statute or particular program statute, or by 
regulation, rule or order issued pursuant thereto, the relevant records 
in the system of records may be referred, as a routine use, to the 
appropriate agency, whether federal, or foreign, charged with the 
responsibility of investigating or prosecuting such violation or charged 
with enforcing or implementing the statute, or rule, regulation or order 
issued pursuant thereto.
    (2) Referrals may be made of assignments of research investigators 
and project monitors to specific research projects to the Smithsonian 
Institution to contribute to the Smithsonian Science Information 
Exchange, Inc.
    (3) In the event the Department deems it desirable or necessary, in 
determining whether particular records are required to be disclosed 
under the Freedom of Information Act, disclosure may be made to the 
Department of Justice for the purpose of obtaining its advice.
    (4) A record from this system of records may be disclosed as a 
``routine use'' to a federal, state or local agency maintaining civil, 
criminal or other relevant enforcement records or other pertinent 
records, such as current licenses, if necessary to obtain a record 
relevant to an agency decision concerning the hiring or retention of an 
employee, the issuance of a security clearance, the letting of a 
contract, or the issuance of a license, grant or other benefit.

A record from this system of records may be disclosed to a federal 
agency, in response to its request, in connection with the hiring or 
retention of an employee, the issuance of a security clearance, the 
reporting of an investigation of an employee, the letting of a contract, 
or the issuance of a license, grant, or other benefit by the requesting 
agency, to the extent that the record is relevant and necessary to the 
requesting agency's decision on the matter.
    (5) In the event that a system of records maintained by this agency 
to carry out its function indicates a violation or potential violation 
of law, whether civil, criminal or regulatory in nature, and whether 
arising by general statute or particular program statute, or by 
regulation, rule or order issued pursuant thereto, the relevant records 
in the system of records may be referred, as a routine use, to the 
appropriate agency, whether state or local charged with the 
responsibility of investigating or prosecuting such violation or charged 
with enforcing or implementing the statute, or rule, regulation or order 
issued pursuant thereto.
    (6) Where federal agencies having the power to subpoena other 
federal agencies' records, such as the Internal Revenue Service or the 
Civil Rights Commission, issue a subpoena to the Department for records 
in this system of records, the Department will make such records 
available.
    (7) Where a contract between a component of the Department and a 
labor organization recognized under E.O. 11491 provides that the agency 
will disclose personal records relevant to the organization's mission, 
records in this system of records may be disclosed to such organization.

[[Page 27]]

    (8) Where the appropriate official of the Department, pursuant to 
the Department's Freedom of Information Regulation determines that it is 
in the public interest to disclose a record which is otherwise exempt 
from mandatory disclosure, disclosure may be made from this system of 
records.
    (9) The Department contemplates that it will contract with a private 
firm for the purpose of collating, analyzing, aggregating or otherwise 
refining records in this system. Relevant records will be disclosed to 
such a contractor. The contractor shall be required to maintain Privacy 
Act safeguards with respect to such records.
    (10) To individuals and organizations, deemed qualified by the 
Secretary to carry out specific research solely for the purpose of 
carrying out such research.
    (11) Disclosures in the course of employee discipline or competence 
determination proceedings.

[45 FR 30808, May 9, 1980; 45 FR 37426, June 3, 1980]



PART 6_INVENTIONS AND PATENTS (GENERAL)--Table of Contents



Sec.
6.0  General policy.
6.1  Publication or patenting of inventions.
6.3  Licensing of Government-owned patents.
6.4  Central records; confidentiality.

    Authority: 5 U.S.C. 301.

    Source: 45 FR 30814, May 9, 1980, unless otherwise noted.



Sec. 6.0  General policy.

    Inventions developed through the resources and activities of the 
Department are a potential resource of great value to the public. It is 
the policy of the Department:
    (a) To safeguard the public interest in inventions developed by 
Department employees, contractors and grantees with the aid of public 
funds and facilities;
    (b) To encourage and recognize individual and cooperative 
achievement in research and investigations; and
    (c) To establish a procedure, consistent with pertinent statutes, 
Executive orders and general Government regulations, for the 
determination of rights and obligations relating to the patenting of 
inventions.



Sec. 6.1  Publication or patenting of inventions.

    It is the general policy of the Department that the results of 
Department research should be made widely, promptly and freely available 
to other research workers and to the public. This availability can 
generally be adequately preserved by the dedication of a Government-
owned invention to the public. Determinations to file a domestic patent 
application on inventions in which the Department has an interest will 
be made where the circumstances indicate that this is desirable in the 
public interest, and if it is practicable to do so. Department 
determinations not to apply for a domestic patent on employee inventions 
are subject to review and approval by the Commissioner of Patents. 
Except where deemed necessary for protecting the patent claim, the fact 
that a patent application has been or may be filed will not require any 
departure from normal policy regarding the dissemination of the results 
of Department research.



Sec. 6.3  Licensing of Government-owned patents.

    (a) Licenses to practice inventions covered by patents and pending 
patent applications owned by the U.S. Government as represented by this 
Department will generally be royalty free, revocable and nonexclusive. 
They will normally be issued to all applicants and will generally 
contain no limitations or standards relating to the quality or testing 
of the products to be manufactured, sold, or distributed thereunder.
    (b) Where it appears however that the public interest will be served 
under the circumstances of the particular case by licenses which impose 
conditions, such as those relating to quality or testing of products, 
requirement of payment of royalties to the Government, etc., or by the 
issuance of limited exclusive licenses by the Secretary after notice and 
opportunity for hearing thereon, such licenses may be issued.



Sec. 6.4  Central records; confidentiality.

    Central files and records shall be maintained of all inventions, 
patents, and licenses in which the Department has an interest, together 
with a record

[[Page 28]]

of all licenses issued by the Department under such patents. Invention 
reports required from employees or others for the purpose of obtaining 
determinations of ownership, and documents and information obtained for 
the purpose of prosecuting patent applications shall be confidential and 
shall be disclosed only as required for official purposes or with the 
consent of the inventor.



PART 7_EMPLOYEE INVENTIONS--Table of Contents



Sec.
7.0  Who are employees.
7.1  Duty of employee to report inventions.
7.3  Determination as to domestic rights.
7.4  Option to acquire foreign rights.
7.7  Notice to employee of determination.
7.8  Employee's right of appeal.

    Authority: E.O. 10096, 15 FR 391; 3 CFR 1950 Supp.; E.O. 10930, 26 
FR 2583; 3 CFR 1961 Supp.

    Source: 45 FR 30814, May 9, 1980, unless otherwise noted.



Sec. 7.0  Who are employees.

    As used in this part, the term Government employee means any officer 
or employee, civilian or military, except such part-time employees or 
part-time consultants as may be excluded therefrom by a determination 
made in writing by the head of the employee's office or constituent 
organization, pursuant to an exemption approved by the Commissioner of 
Patents that to include him or them would be impracticable or 
inequitable, given the reasons therefor. A person shall not be 
considered to be a part-time employee or part-time consultant for this 
purpose unless the terms of his employment contemplate that he shall 
work for less than the minimum number of hours per day, or less than a 
minimum number of days per week, or less than the minimum number of 
weeks per year, regularly required of full-time employees of his class.



Sec. 7.1  Duty of employee to report inventions.

    Every Department employee is required to report to the Secretary in 
accordance with the procedures established therefor, every invention 
made by him (whether or not jointly with others) which bears any 
relation to his official duties or which was made in whole or in any 
part during working hours, or with any contribution of Government 
facilities, equipment, material, funds, or information, or of time or 
services of other Government employees on official duty.



Sec. 7.3  Determination as to domestic rights.

    The determination of the ownership of the domestic right, title, and 
interest in and to an invention which is or may be patentable, made by a 
Government employee while under the administrative jurisdiction of the 
Department, will be made in writing by the Secretary in accordance with 
the provisions of Executive Order 10096 and Government-wide regulations 
issued thereunder by the Commissioner of Patents as follows:
    (a) The Government as represented by the Secretary shall obtain the 
entire domestic right, title and interest in and to all inventions made 
by any Government employee (1) during working hours, or (2) with a 
contribution by the Government of facilities, equipment, materials, 
funds, or information, or of time or services of other Government 
employees on official duty, or (3) which bear a direct relation to or 
are made in consequence of the official duties of the inventor.
    (b) In any case where the contribution of the Government, as 
measured by any one or more of the criteria set forth in paragraph (a) 
of this section, to the invention is insufficient equitably to justify a 
requirement of assignment to the Government of the entire domestic 
right, title and interest in and to such invention, or in any case where 
the Government has insufficient interest in an invention to obtain the 
entire domestic right, title, and interest therein (although the 
Government could obtain same under paragraph (a) of this section), the 
Department, subject to the approval of the Commissioner, shall leave 
title to such invention in the employee, subject, however, to the 
reservation to the Government of a nonexclusive, irrevocable, royalty-
free license in the invention with power to grant licenses for all 
governmental purposes, such reservation to

[[Page 29]]

appear, where practicable, in any patent, domestic or foreign, which may 
issue on such invention.
    (c) In applying the provisions of paragraphs (a) and (b) of this 
section, to the facts and circumstances relating to the making of any 
particular invention, it shall be presumed that an invention made by an 
employee who is employed or assigned (1) to invent or improve or perfect 
any art, machine, manufacture, or composition of matter, (2) to conduct 
or perform research, development work, or both, (3) to supervise, 
direct, coordinate, or review Government financed or conducted research, 
development work, or both, or (4) to act in a liaison capacity among 
governmental or nongovernmental agencies or individuals engaged in such 
work, falls within the provisions of paragraph (a) of this section, and 
it shall be presumed that any invention made by any other employee falls 
within the provisions of paragraph (b) of this section. Either 
presumption may be rebutted by a showing of the facts and circumstances 
and shall not preclude a determination that these facts and 
circumstances justify leaving the entire right, title and interest in 
and to the invention in the Government employee, subject to law.
    (d) In any case wherein the Government neither (1) obtains the 
entire domestic right, title and interest in and to an invention 
pursuant to the provisions of paragraph (a) of this section, nor (2) 
reserves a nonexclusive, irrevocable, royalty-free license in the 
invention, with power to grant licenses for all governmental purposes, 
pursuant to the provisions of paragraph (b) of this section, the 
Government shall leave the entire right, title and interest in and to 
the invention in the Government employee, subject to law.



Sec. 7.4  Option to acquire foreign rights.

    In any case where it is determined that all domestic rights should 
be assigned to the Government, it shall further be determined, pursuant 
to Executive Order 9865 and Government-wide regulations issued 
thereunder, that the Government shall reserve an option to require the 
assignment of such rights in all or in any specified foreign countries. 
In case where the inventor is not required to assign the patent rights 
in any foreign country or countries to the Government or the Government 
fails to exercise its option within such period of time as may be 
provided by regulations issued by the Commissioner of Patents, any 
application for a patent which may be filed in such country or countries 
by the inventor or his assignee shall nevertheless be subject to a 
nonexclusive, irrevocable, royalty-free license to the Government for 
all governmental purposes, including the power to issue sublicenses for 
use in behalf of the Government and/or in furtherance of the foreign 
policies of the Government.



Sec. 7.7  Notice to employee of determination.

    The employee-inventor shall be notified in writing of the 
Department's determination of the rights to his invention and of his 
right of appeal, if any. Notice need not be given if the employee stated 
in writing that he would agree to the determination of ownership which 
was in fact made.



Sec. 7.8  Employee's right of appeal.

    An employee who is aggrieved by a determination of the Department 
may appeal to the Commissioner of Patents, pursuant to section 4(d) of 
Executive Order 10096, as amended by Executive Order 10930, and 
regulations issued thereunder, by filing a written appeal with the 
Commissioner, in duplicate, and a copy of the appeal with the Secretary 
within 30 days (or such longer period as the Commissioner may, for good 
cause, fix in any case) after receiving written notice of such 
determination.



PART 8_DEMANDS FOR TESTIMONY OR RECORDS IN LEGAL PROCEEDINGS--
Table of Contents



Sec.
8.1  What is the scope and applicability of this part?
8.2  What definitions apply?
8.3  What are the requirements for submitting a demand for testimony or 
          records?
8.4  What procedures are followed in response to a demand for testimony?
8.5  What procedures are followed in response to a demand for records?


[[Page 30]]


    Authority: 5 U.S.C. 301; 5 U.S.C. 552; 20 U.S.C. 3474, unless 
otherwise noted.

    Source: 57 FR 34646, Aug. 5, 1992, unless otherwise noted.



Sec. 8.1  What is the scope and applicability of this part?

    (a) Except as provided in paragraph (c) of this section, this part 
establishes the procedures to be followed when the Department or any 
employee of the Department receives a demand for--
    (1) Testimony by an employee concerning--
    (i) Records contained in the files of the Department;
    (ii) Information relating to records contained in the files of the 
Department; or
    (iii) Information or records acquired or produced by the employee in 
the course of his or her official duties or because of the employee's 
official status; or
    (2) The production or disclosure of any information or records 
referred to in paragraph (a)(1) of this section.
    (b) This part does not create any right or benefit, substantive or 
procedural, enforceable by any person against the Department.
    (c) This part does not apply to--
    (1) Any proceeding in which the United States is a party before an 
adjudicative authority;
    (2) A demand for testimony or records made by either House of 
Congress or, to the extent of matter within its jurisdiction, any 
committee or subcommittee of Congress; or
    (3) An appearance by an employee in his or her private capacity in a 
legal proceeding in which the employee's testimony does not relate to 
the mission or functions of the Department.

(Authority: 5 U.S.C. 301; 20 U.S.C. 3474)

[57 FR 34646, Aug. 5, 1992, as amended at 73 FR 27748, May 14, 2008]



Sec. 8.2  What definitions apply?

    The following definitions apply to this part:
    Adjudicative authority includes, but is not limited to--
    (1) A court of law or other judicial forums; and
    (2) Mediation, arbitration, or other forums for dispute resolution.
    Demand includes a subpoena, subpoena duces tecum, request, order, or 
other notice for testimony or records arising in a legal proceeding.
    Department means the U.S. Department of Education.
    Employee means a current or former employee or official of the 
Department or of an advisory committee of the Department, including a 
special government employee, unless specifically provided otherwise in 
this part.
    Legal proceeding means--
    (1) A proceeding before an adjudicative authority;
    (2) A legislative proceeding, except for a proceeding before either 
House of Congress or before any committee or subcommittee of Congress, 
to the extent of matter within the committee's or subcommittee's 
jurisdiction; or
    (3) An administrative proceeding.
    Secretary means the Secretary of Education or an official or 
employee of the Department acting for the Secretary under a delegation 
of authority.
    Testimony means statements made in connection with a legal 
proceeding, including but not limited to statements in court or other 
forums, depositions, declarations, affidavits, or responses to 
interrogatories.
    United States means the Federal Government of the United States and 
any of its agencies or instrumentalities.

(Authority: 5 U.S.C. 301; 20 U.S.C. 3474)

[57 FR 34646, Aug. 5, 1992, as amended at 73 FR 27748, May 14, 2008]



Sec. 8.3  What are the requirements for submitting a demand for 
testimony or records?

    (a) A demand for testimony of an employee or a demand for records 
issued pursuant to the rules governing the legal proceeding in which the 
demand arises--
    (1) Must be in writing; and
    (2) Must state the nature of the requested testimony or records, why 
the information sought is unavailable by any other means, and the reason 
why the release of the information would not be contrary to an interest 
of the Department or the United States''.
    (b) Service of a demand for testimony of an employee must be made on 
the employee whose testimony is demanded, with a copy simultaneously

[[Page 31]]

delivered to the General Counsel, U.S. Department of Education, Office 
of the General Counsel, 400 Maryland Avenue, SW., room 6E300, Lyndon 
Baines Johnson Building, Washington, DC 20202-2100.
    (c) Service of a demand for records, as described in Sec. 8.5(a)(1), 
must be made on an employee who has custody of the records, with a copy 
simultaneously delivered to the General Counsel at the address listed in 
paragraph (b) of this section. For assistance in identifying the 
custodian of the specific records demanded, contact the Records Officer, 
Information Policy and Standards Team, Regulatory Information Management 
Services, Office of Management, U.S. Department of Education, 400 
Maryland Avenue, SW., room 9161, PCP, Washington, DC 20202-4753.

(Authority: 5 U.S.C. 301; 20 U.S.C. 3474)

(Approved by the Office of Management and Budget under control number 
1801-0002)

[57 FR 34646, Aug. 5, 1992, as amended at 58 FR 7860, Feb. 9, 1993; 73 
FR 27748, May 14, 2008]



Sec. 8.4  What procedures are followed in response to a demand for 
testimony?

    (a) After an employee receives a demand for testimony, the employee 
shall immediately notify the Secretary and request instructions.
    (b) An employee may not give testimony without the prior written 
authorization of the Secretary.
    (c)(1) The Secretary may allow an employee to testify if the 
Secretary determines that the demand satisfies the requirements of 
Sec. 8.3 and that granting permission--
    (i) Would be appropriate under the rules of procedure governing the 
matter in which the demand arises and other applicable laws, rules, and 
regulations; and
    (ii) Would not be contrary to an interest of the United States, 
which includes furthering a public interest of the Department and 
protecting the human and financial resources of the United States.
    (2) The Secretary may establish conditions under which the employee 
may testify.
    (d) If a response to a demand for testimony is required before the 
Secretary determines whether to allow an employee to testify, the 
employee or counsel for the employee shall--
    (1) Inform the court or other authority of the regulations in this 
part; and
    (2) Request that the demand be stayed pending the employee's receipt 
of the Secretary's instructions.
    (e) If the court or other authority declines the request for a stay, 
or rules that the employee must comply with the demand regardless of the 
Secretary's instructions, the employee or counsel for the employee shall 
respectfully decline to comply with the demand, citing United States ex 
rel. Touhy v. Ragen, 340 U.S. 462 (1951), and the regulations in this 
part.

(Authority: 5 U.S.C. 301; 20 U.S.C. 3474)



Sec. 8.5  What procedures are followed in response to a demand for
records?

    (a)(1) After an employee receives a demand for records issued 
pursuant to the rules governing the legal proceeding in which the demand 
arises, the employee shall immediately notify the Secretary and request 
instructions.
    (2) If an employee receives any other demand for records, the 
Department--
    (i) Considers the demand to be a request for records under the 
Freedom of Information Act; and
    (ii) Handles the demand under rules governing public disclosure, as 
established in 34 CFR part 5.
    (b) An employee may not produce records in response to a demand as 
described in paragraph (a)(1) of this section without the prior written 
authorization of the Secretary.
    (c) The Secretary may make these records available if the Secretary 
determines that the demand satisfies the requirements of Sec. 8.3 and 
that disclosure--
    (1) Would be appropriate under the rules of procedure governing the 
matter in which the demand arises and other applicable laws, rules, and 
regulations; and
    (2) Would not be contrary to an interest of the United States, which 
includes furthering a public interest of the Department and protecting 
the human and financial resources of the United States.
    (d) If a response to a demand for records as described in paragraph 
(a)(1)

[[Page 32]]

of this section is required before the Secretary determines whether to 
allow an employee to produce those records, the employee or counsel for 
the employee shall--
    (1) Inform the court or other authority of the regulations in this 
part; and
    (2) Request that the demand be stayed pending the employee's receipt 
of the Secretary's instructions.
    (e) If the court or other authority declines the request for a stay, 
or rules that the employee must comply with the demand regardless of the 
Secretary's instructions, the employee or counsel for the employee shall 
respectfully decline to comply with the demand, citing United States ex 
rel. Touhy v. Ragen, 340 U.S. 462 (1951), and the regulations in this 
part.

(Authority: 5 U.S.C. 301; 5 U.S.C. 552; 20 U.S.C. 3474)



PART 12_DISPOSAL AND UTILIZATION OF SURPLUS FEDERAL REAL PROPERTY FOR 
EDUCATIONAL PURPOSES--Table of Contents



                            Subpart A_General

Sec.
12.1  What is the scope of this part?
12.2  What definitions apply?
12.3  What other regulations apply to this program?

         Subpart B_Distribution of Surplus Federal Real Property

12.4  How does the Secretary provide notice of availability of surplus 
          Federal real property?
12.5  Who may apply for surplus Federal real property?
12.6  What must an application for surplus Federal real property 
          contain?
12.7  How is surplus Federal real property disposed of when there is 
          more than one applicant?
12.8  What transfer or lease instruments does the Secretary use?
12.9  What warranties does the Secretary give?
12.10  How is a Public Benefit Allowance (PBA) calculated?

         Subpart C_Conditions Applicable to Transfers or Leases

12.11  What statutory provisions and Executive Orders apply to transfers 
          of surplus Federal real property?
12.12  What are the terms and conditions of transfers or leases of 
          surplus Federal real property?
12.13  When is use of the transferred surplus Federal real property by 
          entities other than the transferee or lessee permissible?

                          Subpart D_Enforcement

12.14  What are the sanctions for noncompliance with a term or condition 
          of a transfer or lease of surplus Federal real property?

                          Subpart E_Abrogation

12.15  What are the procedures for securing an abrogation of the 
          conditions and restrictions contained in the conveyance 
          instrument?

Appendix A to Part 12--Public Benefit Allowance for Transfer of Surplus 
          Federal Real Property for Educational Purposes

    Authority: 40 U.S.C. 471-488; 20 U.S.C. 3401 et seq.; 42 U.S.C. 
2000d (1) et seq.; 20 U.S.C. 1681 et seq.; 29 U.S.C. 794 et seq.; 42 
U.S.C. 4332.

    Source: 57 FR 60394, Dec. 18, 1992, unless otherwise noted.



                            Subpart A_General



Sec. 12.1  What is the scope of this part?

    This part is applicable to surplus Federal real property located 
within any State that is appropriate for assignment to, or that has been 
assigned to, the Secretary by the Administrator for transfer for 
educational purposes, as provided for in section 203(k) of the Federal 
Property and Administrative Services Act of 1949, as amended, 63 Stat. 
377 (40 U.S.C. 471 et seq.).

(Authority: 40 U.S.C. 484(k))



Sec. 12.2  What definitions apply?

    (a) Definitions in the Act. The following terms used in this part 
are defined in section 472 of the Act:

Administrator
Surplus property

    (b) Definitions in the Education Department General Administrative 
Regulations (EDGAR). The following terms used in this part are defined 
in 34 CFR 77.1:

Department
Secretary
State

    (c) Other definitions: The following definitions also apply to this 
part:

[[Page 33]]

    Abrogation means the procedure the Secretary may use to release the 
transferee of surplus Federal real property from the covenants, 
conditions, reservations, and restrictions contained in the conveyance 
instrument before the term of the instrument expires.
    Act means the Federal Property and Administrative Services Act of 
1949, as amended, 63 Stat. 377 (40 U.S.C. 471 et seq.).
    Applicant means an eligible entity as described in Sec. 12.5 that 
formally applies to be a transferee or lessee of surplus Federal real 
property, using a public benefit allowance (PBA) under the Act.
    Lessee, except as used in Sec. 12.14(a)(5), means an entity that is 
given temporary possession, but not title, to surplus Federal real 
property by the Secretary for educational purposes.
    Nonprofit institution means any institution, organization, or 
association, whether incorporated or unincorporated--
    (1) The net earnings of which do not inure or may not lawfully inure 
to the benefit of any private shareholder or individual; and
    (2) That has been determined by the Internal Revenue Service to be 
tax-exempt under section 501(c)(3) of title 26.
    Off-site property means surplus buildings and improvements--
including any related personal property--that are capable of being 
removed from the underlying land and that are transferred by the 
Secretary without transferring the underlying real property.
    On-site property means surplus Federal real property, including any 
related personal property--other than off-site property.
    Period of restriction means that period during which the surplus 
Federal real property transferred for educational purposes must be used 
by the transferee or lessee in accordance with covenants, conditions, 
and any other restrictions contained in the conveyance instrument.
    Program and plan of use means the educational activities to be 
conducted by the transferee or lessee using the surplus Federal real 
property, as described in the application for that property.
    Public benefit allowance (``PBA'') means the credit, calculated in 
accordance with appendix A to this part, given to a transferee or lessee 
which is applied against the fair market value of the surplus Federal 
real property at the time of the transfer or lease of such property in 
exchange for the proposed educational use of the property by the 
transferee or lessee.
    Related personal property means any personal property--
    (1) That is located on and is an integral part of, or incidental to 
the operation of, the surplus Federal real property; or
    (2) That is determined by the Administrator to be otherwise related 
to the surplus Federal real property.
    Surplus Federal real property means the property assigned or 
suitable for assignment to the Secretary by the Administrator for 
disposal under the Act.
    Transfer means to sell and convey title to surplus Federal real 
property for educational purposes as described in this part.
    Transferee means that entity which has purchased and acquired title 
to the surplus Federal real property for educational purposes pursuant 
to section 203(k) of the Act.

(Authority: 40 U.S.C. 472 and 20 U.S.C. 3401 et seq.)



Sec. 12.3  What other regulations apply to this program?

    The following regulations apply to this program:
    (a) 34 CFR parts 100, 104, and 106.
    (b) 41 CFR part 101-47.
    (c) 34 CFR part 85.

(Authority: 40 U.S.C. 484(k); 42 U.S.C. 2000d-1 et seq.; 29 U.S.C. 794 
et seq.; 20 U.S.C. 1681 et seq.; Executive Order 12549; and 20 U.S.C. 
3474)



         Subpart B_Distribution of Surplus Federal Real Property



Sec. 12.4  How does the Secretary provide notice of availability of
surplus Federal real property?

    The Secretary notifies potential applicants of the availability of 
surplus Federal real property for transfer for educational uses in 
accordance with 41 CFR 101-47.308-4.

(Authority: 40 U.S.C. 484(k)(1))

[[Page 34]]



Sec. 12.5  Who may apply for surplus Federal real property?

    The following entities may apply for surplus Federal real property:
    (a) A State.
    (b) A political subdivision or instrumentality of a State.
    (c) A tax-supported institution.
    (d) A nonprofit institution.
    (e) Any combination of these entities.

(Authority: 40 U.S.C. 484(k)(1)(A))



Sec. 12.6  What must an application for surplus Federal real property
contain?

    An application for surplus Federal real property must--
    (a) Contain a program and plan of use;
    (b) Contain a certification from the applicant that the proposed 
program is not in conflict with State or local zoning restrictions, 
building codes, or similar limitations;
    (c) Demonstrate that the proposed program and plan of use of the 
surplus Federal real property is for a purpose that the applicant is 
authorized to carry out;
    (d) Demonstrate that the applicant is able, willing, and authorized 
to assume immediate custody, use, care, and maintenance of the surplus 
Federal real property;
    (e) Demonstrate that the applicant is able, willing, and authorized 
to pay the administrative expenses incident to the transfer or lease;
    (f) Demonstrate that the applicant has the necessary funds, or the 
ability to obtain those funds immediately upon transfer or lease, to 
carry out the proposed program and plan of use for the surplus Federal 
real property;
    (g) Demonstrate that the applicant has an immediate need and ability 
to use all of the surplus Federal real property for which it is 
applying;
    (h) Demonstrate that the surplus Federal real property is needed for 
educational purposes at the time of application and that it is so needed 
for the duration of the period of restriction;
    (i) Demonstrate that the surplus Federal real property is suitable 
or adaptable to the proposed program and plan of use; and
    (j) Provide information requested by the Secretary in the notice of 
availability, including information of the effect of the proposed 
program and plan of use on the environment.

(Approved by the Office of Management and Budget under control number 
1880-0524)

(Authority: 40 U.S.C. 484(k))



Sec. 12.7  How is surplus Federal real property disposed of when there
is more than one applicant?

    (a) If there is more than one applicant for the same surplus Federal 
real property, the Secretary transfers or leases the property to the 
applicant whose proposed program and plan of use the Secretary 
determines provides the greatest public benefit, using the criteria 
contained in appendix A to this part that broadly address the weight 
given to each type of entity applying and its proposed program and plan 
of use. (See example in Sec. 12.10(d)).
    (b) If, after applying the criteria described in paragraph (a) of 
this section, two or more applicants are rated equally, the Secretary 
transfers or leases the property to one of the applicants after--
    (1) Determining the need for each applicant's proposed educational 
use at the site of the surplus Federal real property;
    (2) Considering the quality of each applicant's proposed program and 
plan of use; and
    (3) Considering each applicant's ability to carry out its proposed 
program and plan of use.
    (c) If the Secretary determines that the surplus Federal real 
property is capable of serving more than one applicant, the Secretary 
may apportion it to fit the needs of as many applicants as is 
practicable.
    (d)(1) The Secretary generally transfers surplus Federal real 
property to a selected applicant that meets the requirements of this 
part.
    (2) Alternatively, the Secretary may lease surplus Federal real 
property to a selected applicant that meets the requirements of this 
part if the Secretary determines that a lease will promote the most 
effective use of the property consistent with the purposes of this part 
or if having a lease is otherwise in

[[Page 35]]

the best interest of the United States, as determined by the Secretary.

(Authority: 40 U.S.C. 484(k))



Sec. 12.8  What transfer or lease instruments does the Secretary use?

    (a) The Secretary transfers or leases surplus Federal real property 
using transfer or lease instruments that the Secretary prescribes.
    (b) The transfer or lease instrument contains the applicable terms 
and conditions described in this part and any other terms and conditions 
the Secretary or Administrator determines are appropriate or necessary.

(Authority: 40 U.S.C. 484(c))



Sec. 12.9  What warranties does the Secretary give?

    The Secretary transfers or leases surplus Federal real property on 
an ``as is, where is,'' basis without warranty of any kind.

(Authority: 40 U.S.C. 484(k)(1))



Sec. 12.10  How is a Public Benefit Allowance (PBA) calculated?

    (a) The Secretary calculates a PBA in accordance with the provisions 
of appendix A to this part taking into account the nature of the 
applicant, and the need for, impact of, and type of program and plan of 
use for the property, as described in that appendix.
    (b) The following are illustrative examples of how a PBA would be 
calculated and applied under appendix A:
    (1) Entity A is a specialized school that has had a building 
destroyed by fire, and that has existing facilities determined by the 
Secretary to be between 26 and 50% inadequate. It is proposing to use 
the surplus Federal real property to add a new physical education 
program. Entity A would receive a basic PBA of 70%, a 10% hardship 
organization allowance, a 20% allowance for inadequacy of existing 
school plant facilities, and a 10% utilization allowance for 
introduction of new instructional programs. Entity A would have a total 
PBA of 110%. If Entity A is awarded the surplus Federal real property, 
it would not be required to pay any cash for the surplus Federal real 
property, since the total PBA exceeds 100%.
    (2) Entity B proposes to use the surplus Federal real property for 
nature walks. Because this qualifies as an outdoor educational program, 
Entity B would receive a basic PBA of 40%. If Entity B is awarded the 
surplus Federal real property, it would be required to pay 60% of the 
fair market value of the surplus Federal real property in cash at the 
time of the transfer.
    (3) Entity C is an accredited university, has an ROTC unit, and 
proposes to use the surplus Federal real property for a school health 
clinic and for special education of the physically handicapped. Entity C 
would receive a basic PBA of 50% (as a college or university), a 20% 
accreditation organization allowance (accredited college or university), 
a 10% public service training organization allowance (ROTC), a 10% 
student health and welfare utilization allowance (school health clinic), 
and a 10% service to the handicapped utilization allowance (education of 
the physically handicapped). Entity C would have a total PBA of 100%. If 
Entity C is awarded the surplus Federal real property, it would not be 
required to pay any cash for the surplus Federal real property, since 
the total PBA is 100%.
    (4) Entities A, B, and C all submit applications for the same 
surplus Federal real property. Unless the Secretary decides to apportion 
it, the Secretary transfers or leases the surplus Federal real property 
to Entity A, since its proposed program and plan of use has the highest 
total PBA.

(Authority: 40 U.S.C. 484(k)(1)(c))



         Subpart C_Conditions Applicable to Transfers or Leases



Sec. 12.11  What statutory provisions and Executive Orders apply
to transfers of surplus Federal real property?

    The Secretary directs the transferee or lessee to comply with 
applicable provisions of the following statutes and Executive Orders 
prior to, or immediately upon, transfer or lease, as applicable:
    (a) National Environmental Policy Act of 1969, 42 U.S.C. 4332.
    (b) National Historic Preservation Act of 1966, 16 U.S.C. 470.
    (c) National Flood Insurance Act of 1968, 42 U.S.C. 4001 et seq.

[[Page 36]]

    (d) Floodplain Management, Exec. Order No. 11988, 42 FR 26951 (May 
25, 1977).
    (e) Protection of Wetlands, Exec. Order No. 11990, 42 FR 26961 (May 
25, 1977).
    (f) Title VI of the Civil Rights Act of 1964, 42 U.S.C. 2000(d)(1) 
et seq.
    (g) Title IX of the Education Amendments of 1972, 20 U.S.C. 1681 et 
seq.
    (h) Section 504 of the Rehabilitation Act of 1973, 29 U.S.C. 794 et 
seq.
    (i) Age Discrimination Act of 1975, 42 U.S.C. 1601 et seq.
    (j) Any other applicable Federal or State laws and Executive Orders.

(Authority: 40 U.S.C. 484(k))

(Approved by the Office of Management and Budget under control number 
1880-0524)



Sec. 12.12  What are the terms and conditions of transfers or leases 
of surplus Federal real property?

    (a) General terms and conditions for transfers and leases. The 
following general terms and conditions apply to transfers and leases of 
surplus Federal real property under this part:
    (1) For the period provided in the transfer or lease instrument, the 
transferee or lessee shall use all of the surplus Federal real property 
it receives solely and continuously for its approved program and plan of 
use, in accordance with the Act and these regulations, except that--
    (i) The transferee or lessee has twelve (12) months from the date of 
transfer to place this surplus Federal real property into use, if the 
Secretary did not, at the time of transfer, approve in writing 
construction of major new facilities or major renovation of the 
property;
    (ii) The transferee or lessee has thirty-six (36) months from the 
date of transfer to place the surplus Federal real property into use, if 
the transferee or lessee proposes construction of major new facilities 
or major renovation of the property and the Secretary approves it in 
writing at the time of transfer; and
    (iii) The Secretary may permit use of the surplus Federal real 
property at any time during the period of restriction by an entity other 
than the transferee or lessee in accordance with Sec. 12.13.
    (2) The transferee or lessee may not modify its approved program and 
plan of use without the prior written consent of the Secretary.
    (3) The transferee or lessee may not sell, lease or sublease, rent, 
mortgage, encumber, or otherwise dispose of all or a portion of the 
surplus Federal real property or any interest therein without the prior 
written consent of the Secretary.
    (4) A transferee or lessee shall pay all administrative costs 
incidental to the transfer or lease including, but not limited to--
    (i) Transfer taxes;
    (ii) Surveys;
    (iii) Appraisals;
    (iv) Inventory costs;
    (v) Legal fees;
    (vi) Title search;
    (vii) Certificate or abstract expenses;
    (viii) Decontamination costs;
    (ix) Moving costs;
    (x) Recordation expenses;
    (xi) Other closing costs; and
    (xii) Service charges, if any, provided for by an agreement between 
the Secretary and the applicable State agency for Federal Property 
Assistance.
    (5) The transferee or lessee shall protect the residual financial 
interest of the United States in the surplus Federal real property by 
insurance or such other means as the Secretary directs.
    (6) The transferee or lessee shall file with the Secretary reports 
on its maintenance and use of the surplus Federal real property and any 
other reports required by the Secretary in accordance with the transfer 
or lease instrument.
    (7) Any other term or condition that the Secretary determines 
appropriate or necessary.
    (b) Additional terms and conditions for on-site transfers. The terms 
and conditions in the transfer, including those in paragraph (a) of this 
section, apply for a period not to exceed thirty (30) years.
    (c) Additional terms and conditions for off-site transfers. (1) The 
terms and conditions in the transfer, including those in paragraph (a) 
of this section, apply for a period equivalent to the estimated economic 
life of the property conveyed for a transfer of off-site surplus Federal 
real property.
    (2) In addition to the terms and conditions contained in paragraph 
(c) of

[[Page 37]]

this section, the Secretary may also require the transferee of off-site 
surplus Federal real property--
    (i) To post performance bonds;
    (ii) To post performance guarantee deposits; or
    (iii) To give such other assurances as may be required by the 
Secretary or the holding agency to ensure adequate site clearance.
    (d) Additional terms and conditions for leases. In addition to the 
terms and conditions contained in paragraph (a) of this section, the 
Secretary requires, for leases of surplus Federal real property, that 
all terms and conditions apply to the initial lease agreement, and any 
renewal periods, unless specifically excluded in writing by the 
Secretary.

(Authority: 40 U.S.C. 484(k)(1))

(Approved by the Office of Management and Budget under control number 
1880-0524)



Sec. 12.13  When is use of the transferred surplus Federal real
property by entities other than the transferee or lessee permissible?

    (a) By eligible entities. A transferee or lessee may permit the use 
of all or a portion of the surplus Federal real property by another 
eligible entity as described in Sec. 12.5, only upon those terms and 
conditions the Secretary determines appropriate if--
    (1) The Secretary determines that the proposed use would not 
substantially limit the program and plan of use by the transferee or 
lessee and that the use will not unduly burden the Department;
    (2) The Secretary's written consent is obtained by the transferee or 
lessee in advance; and
    (3) The Secretary approves the use instrument in advance and in 
writing.
    (b) By ineligible entities. A transferee or lessee may permit the 
use of a portion of the surplus Federal real property by an ineligible 
entity, one not described in Sec. 12.5, only upon those terms and 
conditions the Secretary determines appropriate if--
    (1) In accordance with paragraph (a) of this section, the Secretary 
makes the required determination and approves both the use and the use 
instrument;
    (2) The use is confined to a portion of the surplus Federal real 
property;
    (3) The use does not interfere with the approved program and plan of 
use for which the surplus Federal real property was conveyed; and
    (4) Any rental fees or other compensation for use are either 
remitted directly to the Secretary or are applied to purposes expressly 
approved in writing in advance by the Secretary.

(Authority: 40 U.S.C. 484(k)(4))



                          Subpart D_Enforcement



Sec. 12.14  What are the sanctions for noncompliance with a term
or condition of a transfer or lease of surplus Federal real property?

    (a) General sanctions for noncompliance. The Secretary imposes any 
or all of the following sanctions, as applicable, to all transfers or 
leases of surplus Federal real property:
    (1) If all or a portion of, or any interest in, the transferred or 
leased surplus Federal real property is not used or is sold, leased or 
subleased, encumbered, disposed of, or used for purposes other than 
those in the approved program and plan of use, without the prior written 
consent of the Secretary, the Secretary may require that--
    (i) All revenues and the reasonable value of other benefits received 
by the transferee or lessee directly or indirectly from that use, as 
determined by the Secretary, be held in trust by the transferee or 
lessee for the United States subject to the direction and control of the 
Secretary;
    (ii) Title or possession to the transferred or leased surplus 
Federal real property and the right to immediate possession revert to 
the United States;
    (iii) The surplus Federal real property be transferred or leased to 
another eligible entity as the Secretary directs;
    (iv) The transferee or lessee abrogate the conditions and 
restrictions in the transfer or lease instrument in accordance with the 
provisions of Sec. 12.15;
    (v) The transferee or lessee place the surplus Federal real property 
into immediate use for an approved purpose and extend the period of 
restriction in the transfer or lease instrument for a term equivalent to 
the period during

[[Page 38]]

which the property was not fully and solely used for an approved use; or
    (vi) The transferee or lessee comply with any combination of the 
sanctions described in paragraph (a)(1) or (a)(3) of this section.
    (2) If title or possession reverts to the United States for 
noncompliance or is voluntarily reconveyed, the Secretary may require 
the transferee or lessee--
    (i) To reimburse the United States for the decrease in value of the 
transferred or leased surplus Federal real property not due to--
    (A) Reasonable wear and tear;
    (B) Acts of God; or
    (C) Reasonable alterations made by the transferee or lessee to adapt 
the surplus Federal real property to the approved program and plan of 
use for which it was transferred or leased;
    (ii) To reimburse the United States for any costs incurred in 
reverting title or possession;
    (iii) To forfeit any cash payments made by the transferee or lessee 
against the purchase or lease price of surplus Federal real property 
transferred;
    (iv) To take any other action directed by the Secretary; or
    (v) To comply with any combination of the provisions of paragraph 
(a)(3) of this section.
    (3) If the transferee or lessee does not put the surplus Federal 
real property into use within the applicable time limitation in 
Sec. 12.12(a), the Secretary may require the transferee or lessee to 
make cash payments to the Secretary equivalent to the current fair 
market rental value of the surplus Federal real property for each month 
during which the program and plan of use has not been implemented.

(Authority: 40 U.S.C. 484(k)(4))

    (4) If the Secretary determines that a lessee of a transferee or a 
sublessee of a lessee is not complying with a term or condition of the 
lease, or if the lessee voluntarily surrenders the premises, the 
Secretary may require termination of the lease.

(Authority: 40 U.S.C. 484(k)(4)(A))

    (b) Additional sanction for noncompliance with off-site transfer. In 
addition to the sanctions in paragraph (a) of this section, if the 
Secretary determines that a transferee is not complying with a term or 
condition of a transfer of off-site surplus Federal real property, the 
Secretary may require that the unearned PBA become immediately due and 
payable in cash to the United States.

(Authority: 40 U.S.C. 484(k)(4)(A))



                          Subpart E_Abrogation



Sec. 12.15  What are the procedures for securing an abrogation of
the conditions and restrictions contained in the conveyance instrument?

    (a) The Secretary may, in the Secretary's sole discretion, abrogate 
the conditions and restrictions in the transfer or lease instrument if--
    (1) The transferee or lessee submits to the Secretary a written 
request that the Secretary abrogate the conditions and restrictions in 
the conveyance instrument as to all or any portion of the surplus 
Federal real property;
    (2) The Secretary determines that the proposed abrogation is in the 
best interests of the United States;
    (3) The Secretary determines the terms and conditions under which 
the Secretary will consent to the proposed abrogation; and
    (4) The Secretary transmits the abrogation to the Administrator and 
there is no disapproval by the Administrator within thirty (30) days 
after notice to the Administrator.
    (b) The Secretary abrogates the conditions and restrictions in the 
transfer or lease instrument upon a cash payment to the Secretary based 
on the formula contained in the transfer or lease instrument and any 
other terms and conditions the Secretary deems appropriate to protect 
the interest of the United States.

(Authority: 40 U.S.C. 484(k)(4)(A)(iii))

[[Page 39]]



  Sec. Appendix A to Part 12--Public Benefit Allowance for Transfer of 
       Surplus Federal Real Property for Educational Purposes \1\

[[Page 40]]



------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                   Percent allowed
                                                   ---------------------------------------------------------------------------------------------------------------------------------------------
                                                                                     Organization allowances                                    Utilization allowances
                                                      Basic   --------------------------------------------------------------------------------------------------------------------    Maximum
                  Classification                      public                                                Inadequacy of existing   Introduction  Student                             public
                                                     benefit                  Federal   Public             school plant facilities      of new      health             Service to     benefit
                                                    allowance  Accreditation   impact   service  Hardship ------------------------- instructional    and    Research  handicapped  allowance \4\
                                                                                       training            10-25%  26-50%  51-100%     programs    welfare
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Elementary or high schools........................        70   .............       10       10        10       10      20       30          10          10       10          10           100
Colleges or Universities..........................        50           20     .......       10        10       10      20       30          10          10       10          10           100
Specialized schools...............................        70   .............  .......       10        10       10      20       30          10          10       10          10           100
Public libraries or educational museums...........   \2\ 100   .............  .......  ........  ........  ......  ......  .......  .............  .......  ........  ...........     \2\ 100
School outdoor education..........................        40   .............  .......  ........  ........  ......  ......  .......          10      \3\ 10       10   ...........          70
Central administrative and/or service centers.....        80   .............  .......  ........  ........  ......  ......  .......  .............  .......  ........  ...........          80
Non-profit educational research organizations.....        50           20     .......       10   ........  ......  ......  .......          10          10  ........         10           100
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
\2\ Applicable when this is the primary use to be made of the property. The public benefit allowance for the overall program is applicable when such facilities are conveyed as a minor
  component of other facilities.
\3\ This 10% may include an approvable recreation program which will be accessible to the public and entirely compatible with, but subordinate to, the educational program.
\4\ This column establishes the maximum discount from the fair market value for payment due from the transferee at the time of the transfer. This column does not apply for purposes of ranking
  applicants to determine to which applicant the property will be transferred. Competitive rankings are based on the absolute total of public benefit allowance points and are not limited to
  the 100% ceiling.



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

  \1\ This Appendix applies to transfers of both

on-site and off-site surplus property.

[[Page 41]]

               Description of Terms Used in This Appendix

    Elementary or High School means an elementary school (including a 
kindergarten), high school, junior high school, junior-senior high 
school or elementary or secondary school system, that provides 
elementary or secondary education as determined under State law. 
However, it does not include a nursery school even though it may operate 
as part of a school system.
    College or University means a non-profit or public university or 
college, including a junior college, that provides postsecondary 
education.
    Specialized School means a vocational school, area trade school, 
school for the blind, or similar school.
    Public Library means a public library or public library service 
system, not a school library or library operated by non-profit, private 
organizations or institutions that may be open to the general public. 
School libraries receive the public benefit allowance in the appropriate 
school classification.
    Educational Museum means a museum that conducts courses on a 
continuing, not ad hoc, basis for students who receive credits from 
accredited postsecondary education institutions or school systems.
    School Outdoor Education means a separate facility for outdoor 
education as distinguished from components of a basic school. Components 
of a school such as playgrounds and athletic fields receive the basic 
allowance applicable for that type of school. The outdoor education must 
be located reasonably near the school system and may be open to and used 
by the general public, but only if the educational program for which the 
property is conveyed is given priority of use. This category does not 
include components of the school such as playgrounds and athletic 
fields, that are utilized during the normal school year, and are 
available to all students.
    Central Administrative and/or Service Center means administrative 
office space, equipment storage areas, and similar facilities.

                        Description of Allowances

    Basic Public Benefit Allowance means an allowance that is earned by 
an applicant that satisfies the requirements of Sec. 12.10 of this part.

                         Organization Allowance

    Accreditation means an allowance that is earned by any postsecondary 
educational institution, including a vocational or trade school, that is 
accredited by an accrediting agency recognized by the Secretary under 34 
CFR part 602.
    Federal Impact means an allowance that is earned by any local 
educational agency (LEA) qualifying for Federal financial assistance as 
the result of the impact of certain Federal activities upon a community, 
such as the following under Public Law 81-874 and Public Law 81-815: to 
any LEA charged by law with responsibility for education of children who 
reside on, or whose parents are employed on, Federal property, or both; 
to any LEA to which the Federal Government has caused a substantial and 
continuing financial burden as the result of the acquisition of a 
certain amount of Federal property since 1938; or to any LEA that 
urgently needs minimum school facilities due to a substantial increase 
in school membership as the result of new or increased Federal 
activities.
    Public Services Training means an allowance that is earned if the 
applicant has cadet or ROTC units or other personnel training contracts 
for the Federal or State governments. This is given to a school system 
only if the particular school receiving the property furnishes that 
training.
    Hardship means an allowance earned by an applicant that has suffered 
a significant facility loss because of fire, storm, flood, other 
disaster, or condemnation. This allowance is also earned if unusual 
conditions exist such as isolation or economic factors that require 
special consideration.
    Inadequacies of Existing Facilities means an allowance that is 
earned on a percentage basis depending on the degree of inadequacy 
considering both public and nonpublic facilities. Overall plant 
requirements are determined based on the relationship between the 
maximum enrollment accommodated in the present facilities, excluding 
double and night sessions and the anticipated enrollment if the 
facilities are transferred. Inadequacies may be computed for a component 
school unit such as a school farm, athletic field, facility for home 
economics, round-out school site, cafeteria, auditorium, teacherages, 
faculty housing, etc., only if the component is required to meet State 
standards. In that event, the State Department of Education will be 
required to provide a certification of the need. Component school unit 
inadequacies may only be related to a particular school and not to the 
entire school system.

                         Utilization Allowances

    Introduction of New Instructional Programs means an allowance that 
is earned if the proposed use of the property indicates that new 
programs will be added at a particular school. Examples of these new 
programs include those for vocational education, physical education, 
libraries, and similar programs.
    Student Health and Welfare means an allowance that is earned if the 
proposed program and plan of use of the property provides for cafeteria, 
clinic, infirmary, bus loading shelters, or other uses providing for the 
well-being and health of students and eliminating safety and health 
hazards.

[[Page 42]]

    Research means an allowance that is earned if the proposed use of 
the property will be predominantly for research by faculty or graduate 
students under school auspices, or other primary educational research.
    Service to Handicapped means an allowance that is earned if the 
proposed program and plan of use for the property will be for special 
education for the physically or mentally handicapped.



PART 15_UNIFORM RELOCATION ASSISTANCE AND REAL PROPERTY ACQUISITION 
FOR FEDERAL AND FEDERALLY ASSISTED PROGRAMS--Table of Contents



    Authority: Section 213, Uniform Relocation Assistance and Real 
Property Acquisition Policies Act of 1970, Pub. L. 91-646, 84 Stat. 1894 
(42 U.S.C. 4601) as amended by the Surface Transportation and Uniform 
Relocation Assistance Act of 1987, Title IV of Pub. L. 100-17, 101 Stat. 
246-256 (42 U.S.C. 4601 note).



Sec. 15.1  Uniform relocation assistance and real property acquisition.

    Regulations and procedures for complying with the Uniform Relocation 
Assistance Act of 1970 (Pub. L. 91-646, 84 Stat. 1894, 42 U.S.C. 4601) 
as amended by the SUrface Transportation and Uniform Relocation 
Assistance Act of 1987 (Title IV of Pub. L. 100-17, 101 Stat. 264-255, 
42 U.S.C. 4601 note) are set forth in 49 CFR part 24.

[52 FR 48021, Dec. 17, 1987]



PART 21_EQUAL ACCESS TO JUSTICE--Table of Contents



                            Subpart A_General

Sec.
21.1  Equal Access to Justice Act.
21.2  Time period when the Act applies.
21.3  Definitions.

          Subpart B_Which Adversary Adjudications Are Covered?

21.10  Adversary adjudications covered by the Act.
21.11  Effect of judicial review of adversary adjudication.

                Subpart C_How Is Eligibility Determined?

21.20  Types of eligible applicants.
21.21  Determination of net worth and number of employees.
21.22  Applicants representing others.

               Subpart D_How Does One Apply for an Award?

21.30  Time for filing application.
21.31  Contents of application.
21.32  Confidentiality of information about net worth.
21.33  Allowable fees and expenses.

     Subpart E_What Procedures Are Used in Considering Applications?

21.40  Filing and service of documents.
21.41  Answer to application.
21.42  Reply.
21.43  Comments by other parties.
21.44  Further proceedings.

                  Subpart F_How Are Awards Determined?

21.50  Standards for awards.
21.51  Initial decision in applications not subject to the CRRA.
21.52  Initial decision by an adjudicative officer in applications 
          subject to CRRA jurisdiction.
21.53  Final decision of the CRRA.
21.54  Review by the Secretary.
21.55  Final decision if the Secretary does not review.
21.56  Judicial review.

                     Subpart G_How Are Awards Paid?

21.60  Payment of awards.
21.61  Release.

    Authority: 5 U.S.C. 504, unless otherwise noted.

    Source: 58 FR 47192, Sept. 7, 1993, unless otherwise noted.



                            Subpart A_General



Sec. 21.1  Equal Access to Justice Act.

    (a) The Equal Access to Justice Act (the Act) provides for the award 
of fees and other expenses to applicants that--
    (1) Are prevailing parties in adversary adjudications before the 
Department of Education; and
    (2) Meet all other conditions of eligibility contained in this part.
    (b) An eligible applicant, as described in paragraph (a) of this 
section, is entitled to receive an award unless--
    (1) The adjudicative officer, the Civil Rights Reviewing Authority 
(CRRA), or the Secretary on review, determines that--
    (i) The Department's position was substantially justified; or

[[Page 43]]

    (ii) Special circumstances make an award unjust; or
    (2) The adversary adjudication is under judicial review, in which 
case the applicant may receive an award only as described in Sec. 21.11.
    (c) The determination under paragraph (b)(1)(i) of this section is 
based on the administrative record, as a whole, made during the 
adversary adjudication for which fees and other expenses are sought.

(Authority: 5 U.S.C. 504(a)(1) and (c)(1))



Sec. 21.2  Time period when the Act applies.

    The Act applies to any adversary adjudication covered under this 
part pending or commenced before the Department on or after August 5, 
1985.

(Authority: 5 U.S.C. 504(note))



Sec. 21.3  Definitions.

    The following definitions apply to this part:
    Act means the Equal Access to Justice Act.
    Adjudicative officer means the Administrative Law Judge, hearing 
examiner, or other deciding official who presided at the underlying 
adversary adjudication.

(Authority: 5 U.S.C. 504(b)(1)(D))

    Adversary adjudication means a proceeding--
    (1) Conducted by the Department for the formulation of an order or 
decision arising from a hearing on the record under the Administrative 
Procedure Act (5 U.S.C. 554);
    (2) Listed in Sec. 21.10; and
    (3) In which the position of the Department was represented by 
counsel or other representative who entered an appearance and 
participated in the proceeding.

(Authority: 5 U.S.C. 504(b)(1)(C))

    Application subject to the jurisdiction of the CRRA means an 
application for fees and expenses based on an underlying proceeding 
conducted under 34 CFR parts 100, 101, 104, 106, or 110.

(Authority: 5 U.S.C. 504(b)(1)(C); 20 U.S.C. 1681; 29 U.S.C. 794; 42 
U.S.C. 2000d-1 et seq. and 6101 et seq.)

    CRRA means the Civil Rights Reviewing Authority, the reviewing 
authority established by the Secretary to consider applications under 34 
CFR parts 100, 101, 104, 106, and 110.

(Authority: 5 U.S.C. 504(b)(1)(C); 20 U.S.C. 1681; 29 U.S.C. 794; 42 
U.S.C. 2000d-1 et seq. and 6101 et seq.)

    Department means the U.S. Department of Education.
    Department's counsel means counsel for the Department of Education 
or another Federal agency.
    Employee means:
    (1) A person who regularly performs services for an applicant--
    (i) For remuneration; and
    (ii) Under the applicant's direction and control.
    (2) A part-time or seasonal employee who performs services for an 
applicant--
    (i) For renumeration; and
    (ii) Under the applicant's direction and control.

(Authority: 5 U.S.C. 504(c)(1))

    Fees and other expenses means an eligible applicant's reasonable 
fees and expenses--
    (1) Related to the issues on which it was the prevailing party in 
the adversary adjudication; and
    (2) Further described in Secs. 21.33 and 21.50.

(Authority: 5 U.S.C. 504 (a)(1), (b)(1)(A), and (c)(1))

    Party means a ``person'' or a ``party'' as those terms are defined 
in the Administrative Procedure Act (5 U.S.C. 551(3)), including an 
individual, partnership, corporation, association, unit of local 
government, or public or private organization that meets the 
requirements in Sec. 21.20. The term does not include an agency of the 
Federal Government.

(Authority: 5 U.S.C. 504(b)(1)(B))

    Position of the Department means, in addition to the position taken 
by the Department in the adversary adjudication, the action or failure 
to act by the Department upon which the adversary adjudication is based.

(Authority: 5 U.S.C. 504 (a)(1) and (b)(1)(E))


[[Page 44]]


    Secretary means the Secretary of the U.S. Department of Education or 
an official or employee of the Department acting for the Secretary under 
a delegation of authority.

(Authority: 5 U.S.C. 504 (b)(2) and (c)(1))



          Subpart B_Which Adversary Adjudications Are Covered?



Sec. 21.10  Adversary adjudications covered by the Act.

    The Act covers adversary adjudications under section 554 of title 5 
of the United States Code. These include the following:
    (a) Compliance proceedings under title VI of the Civil Rights Act of 
1964 (42 U.S.C. 2000d et seq.).
    (b) Compliance and enforcement proceedings under the Age 
Discrimination Act of 1975 (42 U.S.C. 6101 et seq.).
    (c) Compliance proceedings under title IX of the Education 
Amendments of 1972 (20 U.S.C. 1681 et seq.).
    (d) Compliance proceedings under section 504 of the Rehabilitation 
Act of 1973 (29 U.S.C. 794).
    (e) Withholding proceedings under section 1001 of Pub. L. 100-297 
(Hawkins-Stafford) (20 U.S.C. 2833).
    (f) Proceedings under any of the following:
    (1) Section 5(g) of Pub. L. 81-874 (Financial Assistance for Local 
Educational Agencies in Areas Affected by Federal Activity) (20 U.S.C. 
240(g)).
    (2) Sections 6(c) or 11(a) of Pub. L. 81-815 (an act relating to the 
construction of school facilities in areas affected by Federal 
activities and for other purposes) (20 U.S.C. 636(c) or 641(a)).
    (3) Section 6 of Pub. L. 95-563 (Contract Disputes Act of 1978) (41 
U.S.C. 605).
    (4) Part E of the General Education Provisions Act (20 U.S.C. 1234 
et seq.).
    (g) Other adversary adjudications that fall within the coverage of 
the Act.

(Authority: 5 U.S.C. 504(c) and 554; 20 U.S.C. 1234(f)(2))



Sec. 21.11  Effect of judicial review of adversary adjudication.

    If a court reviews the underlying decision of an adversary 
adjudication covered under this part, an award of fees and other 
expenses may be made only under 28 U.S.C. 2412 (awards in certain 
judicial proceedings).

(Authority: 5 U.S.C. 504(c)(1); 28 U.S.C. 2412(d)(3))



                Subpart C_How Is Eligibility Determined?



Sec. 21.20  Types of eligible applicants.

    The following types of parties that prevail in adversary 
adjudications are eligible to apply under the Act for an award of fees 
and other expenses:
    (a) An individual who has a net worth of not more than $2 million.
    (b) Any owner of an unincorporated business who has--
    (1) A net worth of not more than $7 million, including both personal 
and business interests; and
    (2) Not more than 500 employees.
    (c) A charitable or other tax-exempt organization--
    (1) As described in section 501(c)(3) of the Internal Revenue Code 
of 1954 (26 U.S.C. 501(c)(3)); and
    (2) Having not more than 500 employees.
    (d) A cooperative association--
    (1) As defined in section 15(a) of the Agricultural Marketing Act 
(12 U.S.C. 1141(a)); and
    (2) Having not more than 500 employees.
    (e) Any other partnership, corporation, association, unit of local 
government, or organization that has--
    (1) A net worth of not more than $7 million; and
    (2) Not more than 500 employees.

(Authority: 5 U.S.C. 504(b)(1)(B))



Sec. 21.21  Determination of net worth and number of employees.

    (a) The adjudicative officer shall determine an applicant's net 
worth and number of employees as of the date the adversary adjudication 
was initiated.
    (b) In determining eligibility, the adjudicative officer shall 
include the net worth and number of employees of the applicant and all 
of the affiliates of the applicant.
    (c) For the purposes of paragraph (b) of this section, the 
adjudicative officer shall consider the following as an affiliate:

[[Page 45]]

    (1) Any individual, corporation, or other entity that directly or 
indirectly owns or controls a majority of the voting shares or other 
interest of the applicant;
    (2) Any corporation or other entity of which the applicant directly 
or indirectly owns or controls a majority of the voting shares or other 
interest; and
    (3) Any entity with a financial relationship to the applicant that, 
in the determination of the adjudicative officer, constitutes an 
affiliation for the purposes of paragraph (b) of this section.
    (d) In determining the number of employees of an applicant and its 
affiliates, the adjudicative officer shall count part-time employees on 
a proportional basis.

(Authority: 5 U.S.C. 504(c)(1))



Sec. 21.22  Applicants representing others.

    If an applicant is a party in an adversary adjudication primarily on 
behalf of one or more persons or entities that are ineligible under this 
part, then the applicant is not eligible for an award.

(Authority: 5 U.S.C. 504 (b)(1)(B) and (c)(1))



               Subpart D_How Does One Apply for an Award?



Sec. 21.30  Time for filing application.

    (a) In order to be considered for an award under this part, an 
applicant may file its application when it prevails in an adversary 
adjudication--or in a significant and discrete substantive portion of an 
adversary adjudication--but no later than 30 days after the Department's 
final disposition of the adversary adjudication.
    (b) In the case of a review or reconsideration of a decision in 
which an applicant has prevailed or believes it has prevailed, the 
adjudicative officer shall stay the proceedings on the application 
pending final disposition of the underlying issue.
    (c) For purposes of this part, final disposition of the adversary 
adjudication means the latest of--
    (1) The date on which an initial decision or other recommended 
disposition of the merits of the proceeding by an adjudicative officer 
becomes administratively final;
    (2) The date of an order disposing of any petitions for 
reconsideration of the final order in the adversary adjudication;
    (3) If no petition for reconsideration is filed, the last date on 
which that type of petition could have been filed; or
    (4) The date of a final order or any other final resolution of a 
proceeding--such as a settlement or voluntary dismissal--that is not 
subject to a petition for reconsideration.

(Authority: 5 U.S.C. 504 (a)(2) and (c)(1))



Sec. 21.31  Contents of application.

    (a) In its application for an award of fees and other expenses, an 
applicant shall include the following:
    (1) Information adequate to show that the applicant is a prevailing 
party in an adversary adjudication or in a significant and discrete 
substantive portion of an adversary adjudication.
    (2) A statement that the adversary adjudication is covered by the 
Act according to Sec. 21.10.
    (3) An allegation that the position of the Department was not 
substantially justified, including a description of the specific 
position.
    (4) Unless the applicant is a qualified tax-exempt organization or a 
qualified agricultural cooperative association, information adequate to 
show that the applicant qualifies under the requirements of Secs. 21.20 
and 21.21 regarding net worth. The information, if applicable, shall 
include a detailed exhibit of the net worth of the applicant--and its 
affiliates as described in Sec. 21.21--as of the date the proceeding was 
initiated.
    (5)(i) The total amount of fees and expenses sought in the award; 
and
    (ii) An itemized statement of--
    (A) Each expense; and
    (B) Each fee, including the actual time expended for this fee and 
the rate at which the fee was computed.
    (6) A written verification under oath or affirmation or under 
penalty of perjury from each attorney representing the applicant 
stating--
    (i) The rate at which the fee submitted by the attorney was 
computed; and
    (ii) The actual time expended for the fee.

[[Page 46]]

    (7) A written verification under oath, affirmation, or under penalty 
of perjury that the information contained in the application and any 
accompanying material is true and complete to the best of the 
applicant's information and belief.
    (b) The adjudicative officer may require the applicant to submit 
additional information.

(Authority: 5 U.S.C. 504 (a)(2) and (c)(1))



Sec. 21.32  Confidentiality of information about net worth.

    (a) In a proceeding on an application, the public record ordinarily 
includes the information showing the net worth of the applicant.
    (b) However, if an applicant objects to public disclosure of any 
portion of the information and believes there are legal grounds for 
withholding it from disclosure, the applicant may submit directly to the 
adjudicative officer--
    (1) The information the applicant wishes withheld in a sealed 
envelope labeled ``Confidential Financial Information;'' and
    (2) A motion to withhold the information from public disclosure.
    (c) The motion must--
    (1) Describe the information the applicant is requesting be 
withheld; and
    (2) Explain in detail--
    (i) Why that information falls within one or more of the specific 
exemptions from mandatory disclosure under the Freedom of Information 
Act;
    (ii) Why public disclosure of the information would adversely affect 
the applicant; and
    (iii) Why disclosure is not required in the public interest.
    (d)(1) The applicant shall serve on Department's counsel a copy of 
the material referred to in paragraph (c) of this section.
    (2) The applicant is not required to give a copy of that material to 
any other party to the proceeding.
    (e)(1) If the adjudicative officer finds that the information should 
not be withheld from public disclosure, the information is placed in the 
public record of the proceeding.
    (2) If the adjudicative officer finds that the information should be 
withheld from public disclosure, any request to inspect or copy the 
information is treated in accordance with the Department's established 
procedures under the Freedom of Information Act (34 CFR part 5).

(Authority: 5 U.S.C. 504(c)(1))



Sec. 21.33  Allowable fees and expenses.

    (a) A prevailing party may apply for an award of fees and other 
expenses incurred by the party in connection with--
    (1) An adversary adjudication; or
    (2) A significant and discrete substantive portion of an adversary 
adjudication.
    (b) If a proceeding includes issues covered by the Act and issues 
excluded from coverage, the applicant may apply only for an award of 
fees and other expenses related to covered issues.
    (c) Allowable fees and expenses include the following, as 
applicable:
    (1) An award of fees based on rates customarily charged by 
attorneys, agents, and expert witnesses.
    (2) An award for the reasonable expenses of the attorney, agent, or 
expert witness as a separate item if the attorney, agent, or expert 
witness ordinarily charges clients separately for those expenses.
    (3) The cost of any study, analysis, engineering report, test, or 
project related to the preparation of the applicant's case in the 
adversary adjudication.
    (d) The calculation of fees and expenses as provided for under 
paragraph (c) of this section shall be in accordance with the standards 
for awards as described in Sec. 21.50(a) through (c).

(Authority: 5 U.S.C. 504(a)(1), (b)(1)(A) and (c)(1))



     Subpart E_What Procedures Are Used in Considering Applications?



Sec. 21.40  Filing and service of documents.

    (a) Except as provided in Sec. 21.32 and in applications subject to 
the jurisdiction of the CRRA, an applicant shall--
    (1) File with the adjudicative officer its application and any 
related documents; and

[[Page 47]]

    (2) Serve on all parties to the adversary adjudication copies of its 
application and any related documents.
    (b)(1) In an application subject to the jurisdiction of the CRRA, 
the applicant shall--
    (i) File with the CRRA its application and any other related 
documents; and
    (ii) Serve on all parties to the adversary adjudication copies of 
its application and any related documents.
    (2) In applications subject to Sec. 21.40(b)(1), the CRRA shall 
direct the adjudicative officer to issue an initial decision within 30 
days of the completion of the proceedings on the application. The 
adjudicative officer shall conduct proceedings under the procedures of 
Secs. 21.41-21.44.

(Authority: 5 U.S.C. 504(a)(2) and (c)(1); 20 U.S.C. 1681; 29 U.S.C. 
794; 42 U.S.C. 2000d-1 et seq. and 6101 et seq.)



Sec. 21.41  Answer to application.

    (a)(1) Within 30 days after receiving an application for an award 
under this part, the Department's counsel may file an answer to the 
application.
    (2) The Department's counsel may request an extension of time for 
filing the Department's answer.
    (3) The adjudicative officer shall grant the request for an 
extension if the Department's counsel shows good cause for the request.
    (b)(1) The Department's answer must--
    (i) Explain any objections to the award requested; and
    (ii) Identify the facts relied on in support of the position of the 
Department.
    (2) If the answer is based on any alleged facts not in the record of 
the adversary adjudication, the Department's counsel shall include with 
the answer either--
    (i) Supporting affidavits; or
    (ii) A request for further proceedings under Sec. 21.44.
    (c)(1) If the Department's counsel and the applicant believe that 
the issues in the application can be settled, they may jointly file a 
statement of their intent to negotiate a settlement.
    (2)(i) The filing of a statement of an intent to negotiate extends 
the time for filing an answer for 30 days.
    (ii) The adjudicative officer shall grant further extensions if the 
Department's counsel and the applicant jointly request those extensions.

(Authority: 5 U.S.C. 504(c)(1))



Sec. 21.42  Reply.

    (a) Within 15 days after receiving an answer, an applicant may file 
a reply.
    (b) If the applicant's reply is based on any alleged facts not in 
the record of the adversary adjudication, the applicant shall include 
with the reply either--
    (1) Supporting affidavits; or
    (2) A request for further proceedings under Sec. 21.44.

(Authority: 5 U.S.C. 504(c)(1))



Sec. 21.43  Comments by other parties.

    (a) Any party to a proceeding, other than an applicant or the 
Department's counsel, may file comments on--
    (1) The application within 30 days after the applicant files the 
application;
    (2) The answer within 30 days after the counsel files the answer; or
    (3) Both, if the comments are filed within the time period specified 
in paragraphs (a)(1) and (a)(2) of this section.
    (b) The commenting party may not participate further in proceedings 
on the application unless the adjudicative officer determines that 
further participation is necessary to permit full exploration of matters 
raised in the comments.

(Authority: 5 U.S.C. 504(c)(1))



Sec. 21.44  Further proceedings.

    (a) The adjudicative officer shall make the determination of an 
award on the basis of the written record.
    (b)(1) However, the adjudicative officer may order further 
proceedings on his or her own initiative or at the request of the 
applicant or the Department's counsel.
    (2) The adjudicative officer may order further proceedings only if 
he or she determines that those proceedings are necessary for full and 
fair resolution of issues arising from the application.
    (3) If further proceedings are ordered, the adjudicative officer 
shall determine

[[Page 48]]

the scope of those proceedings, which may include such proceedings as 
informal conferences, oral arguments, additional written submissions, 
discovery, or an evidentiary hearing.
    (4) An adjudicative officer may not order discovery or an 
evidentiary hearing for the issue of whether or not the Department's 
position was substantially justified.
    (c) If the applicant or the Department's counsel requests the 
adjudicative officer to order further proceedings, the request must--
    (1) Specify the information sought or the disputed issues; and
    (2) Explain why the additional proceedings are necessary to obtain 
that information or resolve those issues.

(Authority: 5 U.S.C. 504(a)(3) and (c)(1))



                  Subpart F_How Are Awards Determined?



Sec. 21.50  Standards for awards.

    (a) In determining the reasonableness of the amount sought as an 
award of fees and expenses for an attorney, agent, or expert witness, 
the adjudicative officer shall consider one or more of the following:
    (1)(i) If the attorney, agent, or expert witness is in private 
practice, his or her customary fee for similar services; or
    (ii) If the attorney, agent, or expert witness is an employee of the 
applicant, the fully allocated cost of the services.
    (2) The prevailing rate for similar services in the community in 
which the attorney, agent, or expert witness ordinarily performs 
services.
    (3) The time the attorney, agent, or expert witness actually spent 
on the applicant's behalf with respect to the adversary adjudication.
    (4) The time the attorney, agent, or expert witness reasonably spent 
in light of the difficulty or complexity of the covered issues in the 
adversary adjudication.
    (5) Any other factors that may bear on the value of the services 
provided by the attorney, agent, or expert witness.
    (b) The adjudicative officer may not grant--
    (1) An award for the fee of an attorney or agent in excess of $75.00 
per hour; or
    (2) An award to compensate an expert witness in excess of the 
highest rate at which the Department pays expert witnesses.
    (c) The adjudicative officer may also determine whether--
    (1) Any study, analysis, engineering report, text, or project for 
which the applicant seeks an award was necessary for the preparation of 
the applicant's case in the adversary adjudication; and
    (2) The costs claimed by the applicant for this item or items are 
reasonable.
    (d) The adjudicative officer may not make an award to an eligible 
party if the adjudicative officer, the CRRA, or the Secretary on review 
finds that, based on a review of the administrative record as a whole--
    (1) The position of the Department, as defined in Sec. 21.3, was 
substantially justified; or
    (2) Special circumstances make an award unjust.
    (e) The adjudicative officer may reduce or deny an award to the 
extent that the applicant engaged in conduct that unduly or unreasonably 
protracted the adversary adjudication.
    (f) If an applicant is entitled to an award because the applicant 
prevailed over another agency of the United States that participated in 
a proceeding before the Department and that agency's position was not 
substantially justified, the adjudicative officer shall determine 
whether to make the award, or an appropriate portion of the award, 
against that agency. For the purpose of this determination, the 
requirements of this subpart apply.

(Authority: 5 U.S.C. 504(a), (b)(1)(A), and (b)(1)(E))



Sec. 21.51  Initial decision in applications not subject to the CRRA.

    (a) In applications not subject to the jurisdiction of the CRRA, the 
adjudicative officer shall issue an initial decision on an application 
within 30 days after completion of proceedings on the application.
    (b) The initial decision must include the following:

[[Page 49]]

    (1) Written findings, including sufficient supporting explanation, 
on--
    (i) The applicant's status as a prevailing party;
    (ii) The applicant's eligibility;
    (iii) Whether the position of the Department was substantially 
justified;
    (iv) Whether special circumstances make an award unjust;
    (v) If applicable, whether the applicant engaged in conduct that 
unduly or unreasonably protracted the adversary adjudication; and
    (vi) Other factual issues raised in the adversary adjudication.
    (2) A statement of the amount awarded, including an explanation--
with supporting information--for any difference between the amount 
requested by the applicant and the amount awarded.
    (3) A statement of the applicant's right to request review by the 
Secretary under Sec. 21.54.
    (4) A statement of the applicant's right under Sec. 21.56 to seek 
judicial review of the final award determination.
    (c) The explanation referred to in paragraph (b)(2) of this section 
may include--
    (1) Whether the amount requested was reasonable; and
    (2) The extent to which the applicant unduly or unreasonably 
protracted the adversary adjudication.

(Authority: 5 U.S.C. 504 (a)(3) and (c))



Sec. 21.52  Initial decision by an adjudicative officer in applications
subject to CRRA jurisdiction.

    (a) If the application is subject to the jurisdiction of the CRRA, 
the adjudicative officer shall issue the initial decision within 30 days 
after completion of the proceedings.
    (b) The initial decision must include the information required under 
Sec. 21.51(b). However, instead of the information required under 
Sec. 21.51(b)(3), the initial decision must inform the applicant of--
    (1) Its right to request review by the CRRA; and
    (2) Its right to request review by the Secretary of the CRRA's final 
decision.
    (c) If the applicant or the Department's counsel appeals the 
adjudicative officer's initial decision, the appeal must be submitted to 
the CRRA, in writing, within 30 days after the initial decision is 
issued.
    (d) If the applicant or the Department's counsel does not appeal the 
adjudicative officer's initial decision to the CRRA and the Secretary 
does not decide to review the initial decision under Sec. 21.54(a), the 
initial decision becomes the Department's final decision 60 days after 
it is issued by the officer.

(Authority: 5 U.S.C. 504(b)(1)(C); 20 U.S.C. 1681; 29 U.S.C. 794; 42 
U.S.C. 2000d-1 et seq. and 6101 et seq.)



Sec. 21.53  Final decision of the CRRA.

    (a) In an application subject to the jurisdiction of the CRRA, the 
CRRA shall, within 30 days after receipt of the written appeal--
    (1) Issue a final decision on the appeal of the adjudicative 
officer's initial decision; or
    (2) Remand the application to the adjudicative officer for further 
proceedings.
    (b) The CRRA shall review the initial decision on the basis of the 
written record of the proceedings on the application. This includes but 
is not limited to--
    (1) The written request; and
    (2) The adjudicative officer's findings as described in 
Sec. 21.51(b).
    (c) The CRRA shall act on the review by either--
    (1) Issuing a final decision on the application; or
    (2) Remanding the application to the adjudicative officer for 
further proceedings.
    (d) If the CRRA issues a final decision, the CRRA's decision must 
include--
    (1) Written findings, including supporting explanation, on--
    (i) The applicant's status as a prevailing party;
    (ii) The applicant's eligibility;
    (iii) Whether the position of the Department was substantially 
justified;
    (iv) Whether special circumstances make an award unjust;
    (v) Whether the applicant engaged in conduct that unduly or 
unreasonably protracted the adversary adjudication; and
    (vi) Other factual issues raised in the adversary adjudication.

[[Page 50]]

    (2) A statement of the amount awarded, including an explanation--
with supporting information--for any difference between the amount 
requested by the applicant and the amount awarded.
    (3) A statement of the applicant's right to request review by the 
Secretary under Sec. 21.54.
    (4) A statement of the applicant's right under Sec. 21.56 to seek 
judicial review of the final award determination.
    (e) The explanation referred to in paragraph (d)(2) of this section 
may include--
    (1) Whether the amount requested was reasonable; and
    (2) The extent to which the applicant unduly or unreasonably 
protracted the adversary adjudication.

(Authority: 5 U.S.C. 301, 557 (b) and (c); 20 U.S.C. 1681 and 3401 et 
seq.; 29 U.S.C. 794; 42 U.S.C. 2000d-1 et seq. and 6101 et seq.)



Sec. 21.54  Review by the Secretary.

    (a) The Secretary may decide to review--
    (1) An initial decision made by an adjudicative officer in a 
proceeding not subject to CRRA review;
    (2) An initial decision made by an adjudicative officer in a 
proceeding subject to CRRA review that was not appealed to the CRRA; or
    (3) A final decision made by the CRRA under Sec. 21.53.
    (b)(1) The Secretary does not review a final decision made by an 
adjudicative officer of the General Services Administration Board of 
Contract Appeals.
    (2) The Secretary or a party to the proceedings may seek 
reconsideration of the final decision by an adjudicative officer of the 
General Services Administration Board of Contract Appeals on the fee 
application in accordance with 48 CFR 6101.32.
    (c) The Secretary decides to review a decision under Sec. 21.54(a) 
either--
    (1) Upon receipt of a written request for review by an applicant or 
Department's counsel; or
    (2) Upon the Secretary's own motion.
    (d) If the applicant or the Department's counsel seeks a review, the 
request must be submitted to the Secretary, in writing, within 30 days 
of--
    (1) An initial decision in a proceeding not subject to CRRA review; 
or
    (2) A final decision of the CRRA.
    (e) The Secretary decides whether to accept or reject a request for 
review of an initial decision made by the adjudicative officer in a 
proceeding not subject to CRRA review or a final decision of the CRRA 
within 30 days after receipt of a request for review.
    (f) The Secretary may decide on his own motion to review a decision 
made under Sec. 21.54(a) within 60 days of the initial decision by the 
adjudicative officer or a final decision of the CRRA.
    (g) If the Secretary decides to review the adjudicative officer's 
initial decision or the CRRA's final decision--
    (1) The Secretary reviews the adjudicative officer's initial 
decision or the CRRA's final decision on the basis of the written record 
of the proceedings on the application. This includes, but is not 
restricted to--
    (i) The written request for review;
    (ii) The adjudicative officer's findings as described in 
Sec. 21.51(b); and
    (iii) If applicable, the final decision of the CRRA, if any; and
    (2) The Secretary either--
    (i) Issues a final decision; or
    (ii) Remands the application to the adjudicative officer or the CRRA 
for further proceedings.
    (h) If the Secretary issues a final decision, the Secretary's 
decision--
    (1) Is in writing;
    (2) States the reasons for the decision; and
    (3) If the decision is adverse to the applicant, advises the 
applicant of its right to petition for judicial review under Sec. 21.56.

(Authority: 5 U.S.C. 557 (b) and (c))



Sec. 21.55  Final decision if the Secretary does not review.

    If the Secretary takes no action under Sec. 21.54--
    (a) The adjudicative officer's initial decision on the application 
becomes the Department's final decision 60 days after it is issued by 
the adjudicative officer; or
    (b) The CRRA's decision on the application becomes the Department's 
final decision 60 days after it is issued by the CRRA.

(Authority: 5 U.S.C. 301)

[[Page 51]]



Sec. 21.56  Judicial review.

    If the applicant is dissatisfied with the award determination in the 
final decision under Secs. 21.52-21.55, the applicant may seek judicial 
review of that determination under 5 U.S.C. 504(c)(2) within 30 days 
after that determination was made.

(Authority: 5 U.S.C. 504(c)(2))



                     Subpart G_How Are Awards Paid?



Sec. 21.60  Payment of awards.

    To receive payment, an applicant granted an award under the Act must 
submit to the Financial Management Service of the Department--
    (a) A request for payment signed by the applicant or its duly 
authorized agent;
    (b) A copy of the final decision granting the award; and
    (c) A statement that--
    (1) The applicant will not seek review of the decision in the United 
States courts; or
    (2) The process for seeking review of the award has been completed.

(Authority: 5 U.S.C. 504(c)(1) and (d))



Sec. 21.61  Release.

    If an applicant, its agent, or its attorney accepts payment of any 
award or settlement in conjunction with an application under this part, 
that acceptance--
    (a) Is final and conclusive with respect to that application; and
    (b) Constitutes a complete release of any further claim against the 
United States with respect to that application.

(Authority: 5 U.S.C. 504(c)(1))



PART 30_DEBT COLLECTION--Table of Contents



                            Subpart A_General

Sec.
30.1  What administrative actions may the Secretary take to collect a 
          debt?
30.2  On what authority does the Secretary rely to collect a debt under 
          this part?

Subpart B [Reserved]

        Subpart C_What Provisions Apply to Administrative Offset?

                        General Offset Procedures

30.20  To what do Secs. 30.20-30.31 apply?
30.21  When may the Secretary offset a debt?
30.22  What notice does the debtor receive before the commencement of 
          offset?
30.23  How must a debtor request an opportunity to inspect and copy 
          records relating to a debt?
30.24  What opportunity does the debtor receive to obtain a review of 
          the existence or amount of a debt?
30.25  How may a debtor obtain an oral hearing?
30.26  What special rules apply to an oral hearing?
30.27  When does the Secretary enter into a repayment agreement rather 
          than offset?
30.28  When may the Secretary offset before completing the procedures 
          under Secs. 30.22-30.27?
30.29  What procedures apply when the Secretary offsets to collect a 
          debt owed another agency?
30.30  What procedures apply when the Secretary requests another agency 
          to offset a debt owed under a program or activity of the 
          Department?
30.31  How does the Secretary apply funds recovered by offset if 
          multiple debts are involved?

                    IRS Tax Refund Offset Procedures

30.33  What procedures does the Secretary follow for IRS tax refund 
          offsets?

      Procedures for Reporting Debts to Consumer Reporting Agencies

30.35  What procedures does the Secretary follow to report debts to 
          consumer reporting agencies?

Subpart D [Reserved]

    Subpart E_What Costs and Penalties Does the Secretary Impose on 
                           Delinquent Debtors?

30.60  What costs does the Secretary impose on delinquent debtors?
30.61  What penalties does the Secretary impose on delinquent debtors?
30.62  When does the Secretary forego interest, administrative costs, or 
          penalties?

  Subpart F_What Requirements Apply to the Compromise of a Debt or the 
             Suspension or Termination of Collection Action?

30.70  How does the Secretary exercise discretion to compromise a debt 
          or to suspend or terminate collection of a debt?

[[Page 52]]

Subpart G [Reserved]

    Authority: 20 U.S.C. 1221e-3(a)(1), and 1226a-1, 31 U.S.C. 3711(e), 
31 U.S.C. 3716(b) and 3720A, unless otherwise noted.

    Source: 51 FR 24099, July 1, 1986, unless otherwise noted.



                            Subpart A_General



Sec. 30.1  What administrative actions may the Secretary take to
collect a debt?

    (a) The Secretary may take one or more of the following actions to 
collect a debt owed to the United States:
    (1) Collect the debt under the procedures authorized in the 
regulations in this part.
    (2) Refer the debt to the General Accounting Office for collection.
    (3) Refer the debt to the Department of Justice for compromise, 
collection, or litigation.
    (4) Take any other action authorized by law.
    (b) In taking any of the actions listed in paragraph (a) of this 
section, the Secretary complies with the requirements of the Federal 
Claims Collection Standards (FCCS) at 4 CFR parts 101-105 that are not 
inconsistent with the requirements of this part.
    (c) The Secretary may--
    (1) Collect the debt under the offset procedures in subpart C of 
this part;
    (2) Report a debt to a consumer reporting agency under the 
procedures in subpart C of this part;
    (3) Charge interest on the debt as provided in the FCCS;
    (4) Impose upon a debtor a charge based on the costs of collection 
as determined under subpart E of this part;
    (5) Impose upon a debtor a penalty for failure to pay a debt when 
due under subpart E of this part;
    (6) Compromise a debt, or suspend or terminate collection of a debt, 
under subpart F of this part;
    (7) Take any other actions under the procedures of the FCCS in order 
to protect the United States Government's interests; or
    (8) Use any combination of the procedures listed in this paragraph 
(c) as may be appropriate in a particular case.

(Authority: 20 U.S.C. 1221e-3(a)(1) and 1226a-1, 31 U.S.C. 3711(e))

[53 FR 33425, Aug. 30, 1988]



Sec. 30.2  On what authority does the Secretary rely to collect a debt
under this part?

    (a)(1) The Secretary takes an action referred to under Sec. 30.1(a) 
in accordance with--
    (i) 31 U.S.C. chapter 37, subchapters I and II;
    (ii) Other applicable statutory authority; or
    (iii) The common law.
    (2) If collection of a debt in a particular case is not authorized 
under one of the authorities described in paragraph (a)(1) of this 
section, the Secretary may collect the debt under any other available 
authority under which collection is authorized.
    (b) The Secretary does not use a procedure listed in Sec. 30.1(c) to 
collect a debt, or a certain type of debt, if--
    (1) The procedure is specifically prohibited under a Federal 
statute; or
    (2) A separate procedure other than the procedure described under 
Sec. 30.1(c) is specifically required under--
    (i) A contract, grant, or other agreement;
    (ii) A statute other than 31 U.S.C. 3716; or
    (iii) Other regulations.

(Authority: 20 U.S.C. 1221e-3(a)(1) and 1226a-1, 31 U.S.C. 3711(e))

[53 FR 33425, Aug. 30, 1988]

Subpart B [Reserved]



        Subpart C_What Provisions Apply to Administrative Offset?

                        General Offset Procedures



Sec. 30.20  To what do Secs. 30.20-30.31 apply?

    (a)(1)(i) Sections 30.20-30.31 establish the general procedures used 
by the Secretary to collect debts by administrative offset.
    (ii) The Secretary uses the procedures established under other 
regulations, including Sec. 30.33, What procedures does the Secretary 
follow for IRS

[[Page 53]]

tax refund offsets?, 34 CFR part 31, Salary Offset for Federal Employees 
Who Are Indebted to the United States Under Programs Administrated by 
the Secretary of Education, and 34 CFR part 32, Salary Offset to Recover 
Overpayments of Pay or Allowances from Department of Education 
Employees, if the conditions requiring application of those special 
procedures exists.
    (2) The word ``offset'' is used in this subpart to refer to the 
collection of a debt by administrative offset.
    (b) The Secretary does not rely on 31 U.S.C. 3716 as authority for 
offset if:
    (1) The debt is owed by a State or local government;
    (2) The debt, or the payment against which offset would be taken, 
arises under the Social Security Act;
    (3) The debt is owed under:
    (i) The Internal Revenue Code of 1954; or
    (ii) The tariff laws of the United States; or
    (4) The right to collect the debt first accrued more than ten years 
before initiation of the offset.
    (c)(1) The Secretary may rely on 31 U.S.C. 3716 as authority for 
offset of a debt to which paragraph (b)(4) of this section would 
otherwise apply if facts material to the Government's right to collect 
the debt were not known and could not reasonably have been known by the 
official or officials of the Government who are charged with the 
responsibility to discover and collect the debt.
    (2) If paragraph (c)(1) of this section applies, the Secretary may 
rely on 31 U.S.C. 3716 as authority for offset up to 10 years after the 
date that the official or officials described in that paragraph first 
knew or reasonably should have known of the right of the United States 
to collect the debt.
    (d) The Secretary determines when the right to collect a debt first 
accrued under the existing law regarding accrual of debts such as 28 
U.S.C. 2415.

(Authority: 20 U.S.C. 1221e-3(a)(1) and 1226a-1, 31 U.S.C. 3716(b))

[51 FR 24099, July 1, 1986, as amended at 51 FR 35646, Oct. 7, 1986; 53 
FR 33425, Aug. 30, 1988; 54 FR 43583, Oct. 26, 1989]



Sec. 30.21  When may the Secretary offset a debt?

    (a) The Secretary may offset a debt if:
    (1) The debt is liquidated or certain in amount; and
    (2) Offset is feasible and not otherwise prohibited.
    (b)(1) Whether offset is feasible is determined by the Secretary in 
the exercise of sound discretion on a case-by-case basis, either:
    (i) For each individual debt or offset; or
    (ii) For each class of similar debts or offsets.
    (2) The Secretary considers the following factors in making this 
determination:
    (i) Whether offset can be practically and legally accomplished.
    (ii) Whether offset will further and protect the interests of the 
United States.
    (c) The Secretary may switch advance funded grantees to a 
reimbursement payment system before initiating an offset.

(Authority: 20 U.S.C. 1221e-3(a)(1) and 1226a-1, 31 U.S.C. 3716(b))



Sec. 30.22  What notice does the debtor receive before the 
commencement of offset?

    (a)(1) Except as provided in Secs. 30.28 and 30.29, the Secretary 
provides a debtor with written notice of the Secretary's intent to 
offset before initiating the offset.
    (2) The Secretary mails the notice to the debtor at the current 
address of the debtor, as determined by the Secretary from information 
regarding the debt maintained by the Department.
    (b) The written notice informs the debtor regarding:
    (1) The nature and amount of the debt;
    (2) The Secretary's intent to collect the debt by offset;
    (3) The debtor's opportunity to:
    (i) Inspect and copy Department records pertaining to the debt;
    (ii) Obtain a review within the Department of the existence or 
amount of the debt; and
    (iii) Enter into a written agreement with the Secretary to repay the 
debt;

[[Page 54]]

    (4) The date by which the debtor must request an opportunity set 
forth under paragraph (b)(3) of this section; and
    (5) The Secretary's decision, in appropriate cases, to switch the 
debtor from advance funding to a reimbursement payment system.
    (c)(1) In determining whether a debtor has requested an opportunity 
set forth under paragraph (b)(3) of this section in a timely manner, the 
Secretary relies on:
    (i) A legibly dated U.S. Postal Service postmark for the debtor's 
request; or
    (ii) A legibly stamped U.S. Postal service mail receipt for debtor's 
request.
    (2) The Secretary does not rely on either of the following as proof 
of mailing;
    (i) A private metered postmark.
    (ii) A mail receipt that is not dated by the U.S. Postal Service.

    Note: The U.S. Postal Service does not uniformly provide a dated 
postmark. Before relying on this method for proof of mailing, a debtor 
should check with its local post office.

    (d) If a debtor previously has been notified of the Secretary's 
intent to offset or offered an opportunity to take any of the actions 
set forth in paragraph (b)(3) of this section in connection with the 
same debt, the Secretary may offset without providing the debtor with an 
additional notice of intent or opportunity to take any of those actions 
under these offset procedures.

(Authority: 20 U.S.C. 1221e-3(a)(1) and 1226a-1, 31 U.S.C. 3716(b))



Sec. 30.23  How must a debtor request an opportunity to inspect and
copy records relating to a debt?

    (a) If a debtor wants to inspect and copy Department documents 
relating to the debt, the debtor must:
    (1) File a written request to inspect and copy the documents within 
20 days after the date of the notice provided under Sec. 30.22; and
    (2) File the request at the address specified in that notice.
    (b) A request filed under paragraph (a) of this section must 
contain:
    (1) All information provided to the debtor in the notice under 
Sec. 30.22 or Sec. 30.33(b) that identifies the debtor and the debt, 
including the debtor's Social Security number and the program under 
which the debt arose, together with any corrections of that identifying 
information; and
    (2) A reasonably specific identification of the records the debtor 
wishes to have available for inspection and copying.
    (c) The Secretary may decline to provide an opportunity to inspect 
and copy records if the debtor fails to request inspection and copying 
in accordance with this section.

(Approved by the Office of Management and Budget under control number 
1880-0515)

(Authority: 20 U.S.C. 1221e-3(a)(1) and 1226a-1, 31 U.S.C. 3716(b))

[51 FR 24099, July 1, 1986, as amended at 51 FR 35646, Oct. 7, 1986]



Sec. 30.24  What opportunity does the debtor receive to obtain
a review of the existence or amount of a debt?

    (a) If a debtor wants a review within the Department of the issues 
identified in the notice under Sec. 30.22(b)(3)(ii) or 
Sec. 30.33(b)(3)(ii), the debtor must:
    (1) File a request for review within 20 days after the date of the 
notice provided under Sec. 30.22; and
    (2) File a request at the address specified in that notice.
    (b) A request filed under paragraph (a) of this section must 
contain:
    (1) All information provided to the debtor in the notice under 
Sec. 30.22 or Sec. 30.33(b) that identifies the debtor and the 
particular debt, including the debtor's Social Security number and the 
program under which the debt arose, together with any corrections of 
that identifying information; and
    (2) An explanation of the reasons the debtor believes that the 
notice the debtor received under Sec. 30.22 or Sec. 30.33(b) 
inaccurately states any facts or conclusions relating to the debt.
    (c) The Secretary may decline to provide an opportunity for review 
of a debt if the debtor fails to request the review in accordance with 
this section.
    (d)(1) The debtor shall:
    (i) File copies of any documents relating to the issues identified 
in the notice under Sec. 30.22(b)(3)(ii) or Sec. 30.33(b)(3)(ii) that 
the debtor wishes

[[Page 55]]

the Secretary to consider in the review;
    (ii) File the documents at the address specified in that notice, and
    (iii) File the documents no later than:
    (A) 20 days after the date of the notice provided under Sec. 30.22; 
or
    (B) If the debtor has requested an opportunity to inspect and copy 
records under Sec. 30.23 within the time period specified in that 
section, 15 days after the date on which the Secretary makes available 
to the debtor the relevant, requested records.
    (2) The Secretary may decline to consider any reasons or documents 
that the debtor fails to provide in accordance with paragraphs (b) and 
(d) of this section.
    (e) If the Secretary bases the review on only the documentary 
evidence, the Secretary:
    (1) Reviews the documents submitted by the debtor and other relevant 
evidence; and
    (2) Notifies the debtor in writing of the Secretary's decision 
regarding the issues identified in the notice under Sec. 30.22(b)(3)(ii) 
or Sec. 30.33(b)(3)(ii) and, if appropriate, the question of waiver of 
the debt.

(Approved by the Office of Management and Budget under control number 
1880-0515)

(Authority: 20 U.S.C. 1221e-3(a)(1) and 1226a-1, 31 U.S.C. 3716(b))

[51 FR 24099, July 1, 1986, as amended at 51 FR 35647, Oct. 7, 1986]



Sec. 30.25  How may a debtor obtain an oral hearing?

    (a) If a debtor wants the Secretary to conduct the review requested 
under Sec. 30.24 as an oral hearing, the debtor must file a written 
request for an oral hearing together with the request for review filed 
under Sec. 30.24(a).
    (b) A request filed under paragraph (a) of this section must contain 
the following in addition to the information filed under Sec. 30.24(b):
    (1) An explanation of reason(s) why the debtor believes the 
Secretary cannot resolve the issues identified in the notice under 
Sec. 30.22(b)(3)(ii) or Sec. 30.33(b)(3)(ii) through a review of the 
documentary evidence.
    (2) An identification of:
    (i) The individuals that the debtor wishes to have testify at the 
oral hearing;
    (ii) The specific issues identified in the notice regarding which 
each individual is prepared to testify; and
    (iii) The reasons why each individual's testimony is necessary to 
resolve the issue.
    (c) The Secretary grants a debtor's request for an oral hearing 
regarding the issues identified in the notice under Sec. 30.22(b)(3)(ii) 
or Sec. 30.33(b)(3)(ii) only if:
    (1)(i) A statute authorizes or requires the Secretary to consider 
waiver of the indebtedness involved;
    (ii) The debtor files a request for waiver of the indebtedness with 
the request for review filed under paragraph (a)(1) of this section; and
    (iii) The question of waiver of the indebtedness turns on an issue 
of credibility or veracity; or
    (2) The Secretary determines that the issues identified in the 
notice under Sec. 30.22(b)(3)(ii) or Sec. 30.33(b)(3)(ii) cannot be 
resolved by review of only the documentary evidence.
    (d) Notwithstanding paragraph (b) of this section, the Secretary may 
deny oral hearings for a class of similar debts if:
    (1) The issues identified in the notice under Sec. 30.22(b)(3)(ii) 
or 30.33(b)(3)(ii) for which an oral hearing was requested, or the issue 
of waiver, rarely involve issues of credibility or veracity; and
    (2) The Secretary determines that review of the documentary evidence 
is ordinarily an adequate means to correct mistakes.
    (e) The Secretary may decline to consider any reasons that the 
debtor fails to provide in accordance with paragraph (b)(1) of this 
section.

(Approved by the Office of Management and Budget under control number 
1880-0515)

(Authority: 20 U.S.C. 1221e-3(a)(1) and 1226a-1, 31 U.S.C. 3716(b))

[51 FR 24099, July 1, 1986, as amended at 51 FR 35647, Oct. 7, 1986]



Sec. 30.26  What special rules apply to an oral hearing?

    (a) The oral hearing under Sec. 30.25 is not a formal evidentiary 
hearing subject to 5 U.S.C. 554, unless required by law.

[[Page 56]]

    (b) If the Secretary grants an oral hearing, the Secretary notifies 
the debtor in writing of:
    (1) The time and place for the hearing;
    (2) The debtor's right to representation; and
    (3) The debtor's right to present and cross examine witnesses.
    (c) If the Secretary grants an oral hearing, the Secretary 
designates an official to:
    (1) Govern the conduct of the hearing;
    (2) Take all necessary action to avoid unreasonable delay in the 
proceedings;
    (3) Review the evidence presented at the hearing, the documents 
submitted by the debtor, and other relevant evidence; and
    (4) After considering the evidence, notify the debtor in writing of 
the official's decision regarding the issues identified in the notice 
under Sec. 30.22(b)(3)(ii) or Sec. 30.33(b)(3)(ii) and, if appropriate, 
the question of waiver of the debt.
    (d) The official designated under paragraph (c) of this section may 
decline to hear any witnesses or testimony not identified by the debtor 
in accordance with Sec. 30.25(b)(2).
    (e) The decision of the designated official under paragraph (c) of 
this section constitutes the final decision of the Secretary.

(Authority: 20 U.S.C. 1221-3(a)(1) and 1226a-1, 31 U.S.C. 3716(b))



Sec. 30.27  When does the Secretary enter into a repayment agreement
rather than offset?

    (a) If a debtor wants an opportunity to enter into a written 
agreement to repay a debt on terms acceptable to the Secretary, the 
debtor must:
    (1) File a request to enter into such agreement within 20 days after 
the date of the notice provided under Sec. 30.22; and
    (2) File the request at the address specified in the notice.
    (b) A request filed under paragraph (a) of this section must contain 
all information provided to the debtor in the notice under Sec. 30.22 or 
Sec. 30.33(b) that identifies the debtor and the debt, including the 
debtor's Social Security number and the program under which the debt 
arose, together with any corrections of that identifying information.
    (c) If the Secretary receives a request filed in accordance with 
this section, the Secretary may enter into a written agreement requiring 
repayment in accordance with 4 CFR 102.11, instead of offsetting the 
debt.
    (d) In deciding whether to enter into the agreement, the Secretary 
may consider:
    (1) The Government's interest in collecting the debt; and
    (2) Fairness to the debtor.
    (e)(1) A debtor that enters into a repayment agreement with the 
Secretary under this section waives any right to further review by the 
Secretary of the issues relating to the original debt identified in the 
notice under Sec. 30.22(b)(3)(ii) or Sec. 30.33(b)(3)(ii).
    (2) If a debtor breaches a repayment agreement, the Secretary may 
offset, or, under Sec. 30.30, refer to another agency for offset:
    (i) The amount owing under the agreement; or
    (ii) The entire original debt, to the extent not repaid.

(Authority: 20 U.S.C. 1221-3(a)(1) and 1226a-1, 31 U.S.C. 3716(b))

[51 FR 24099, July 1, 1986, as amended at 51 FR 35647, Oct. 7, 1986]



Sec. 30.28  When may the Secretary offset before completing the
procedures under Secs. 30.22-30.27?

    (a) The Secretary may offset before completing the procedures 
otherwise required by Secs. 30.22-30.27 if:
    (1) Failure to offset would substantially prejudice the Government's 
ability to collect the debt; and
    (2) The amount of time remaining before the payment by the United 
States which is subject to offset does not reasonably permit completion 
of the procedures under Secs. 30.22-30.27.
    (b) If the Secretary offsets under paragraph (a) of this section, 
the Secretary:
    (1) Promptly completes the procedures under Secs. 30.22-30.27 after 
initiating the offset; and

[[Page 57]]

    (2) Refunds any amounts recovered under the offset that are later 
found not to be owed to the United States.

(Authority: 20 U.S.C. 1221e-3(a)(1) and 1226a-1, 31 U.S.C. 3716(b))



Sec. 30.29  What procedures apply when the Secretary offsets to 
collect a debt owed another agency?

    The Secretary may initiate offset to collect a debt owed another 
Federal agency if:
    (a) An official of that agency certifies in writing:
    (1) That the debtor owes a debt to the United States;
    (2) The amount of the debt; and
    (3) That the agency has complied with 4 CFR 102.3; and
    (b) For offsets under 31 U.S.C. 3716, the Secretary makes an 
independent determination that the offset meets the standards under 
Sec. 30.21(a)(2).

(Authority: 20 U.S.C. 1221e-3(a)(1) and 1226a-1, 31 U.S.C. 3716(b))



Sec. 30.30  What procedures apply when the Secretary requests another
agency to offset a debt owed under a program or activity of the 
Department?

    (a) The Secretary may request another Federal agency to offset a 
debt owed under a program or activity of the Department if the Secretary 
certifies in writing to the other Federal agency:
    (1) That the debtor owes a debt to the United States;
    (2) The amount of the debt; and
    (3) That the Secretary has complied with 4 CFR 102.3.
    (b) Before providing the certification required under paragraph (a) 
of this section, the Secretary complies with the procedures in 
Secs. 30.20-30.27.

(Authority: 20 U.S.C. 1221e-3(a)(1) and 1226a-1, 31 U.S.C. 3716(b))



Sec. 30.31  How does the Secretary apply funds recovered by offset
if multiple debts are involved?

    If the Secretary collects more than one debt of a debtor by 
administrative offset, the Secretary applies the recovered funds to 
satisfy those debts based on the Secretary's determination of the best 
interests of the United States, determined by the facts and 
circumstances of the particular case.

(Authority: 20 U.S.C. 1221e-3(a)(1) and 1226a-1, 31 U.S.C. 3716(b))

                    IRS Tax Refund Offset Procedures



Sec. 30.33  What procedures does the Secretary follow for IRS tax
refund offsets?

    (a) If a named person owes a debt under a program or activity of the 
Department, the Secretary may refer the debt for offset to the Secretary 
of the Treasury after complying with the procedures in Secs. 30.20-
30.28, as modified by this section.
    (b) Notwithstanding Sec. 30.22(b), the notice sent to a debtor under 
Sec. 30.22 informs the debtor that:
    (1) The debt is past due;
    (2) The Secretary intends to refer the debt for offset to the 
Secretary of Treasury;
    (3) The debtor has an opportunity to:
    (i) Inspect and copy Department records regarding the existence, 
amount, enforceability, or past-due status of the debt;
    (ii) Obtain a review within the Department of the existence, amount, 
enforceability, or past-due status of the debt;
    (iii) Enter into a written agreement with the Secretary to repay the 
debt; and
    (4) The debtor must take an action set forth under paragraph (b)(3) 
by a date specified in the notice.
    (c) Notwithstanding Sec. 30.23(a), if a debtor wants to inspect and 
copy Department records regarding the existence, amount, enforceability, 
or past-due status of the debt, the debtor must:
    (1) File a written request to inspect and copy the records within 20 
days after the date of the notice provided under Sec. 30.22; and
    (2) File the request at the address specified in that notice.
    (d) Notwithstanding the time frame under Sec. 30.24(a), if a debtor 
wants a review under that paragraph, the debtor must file a request for 
review at the address specified in the notice by the later of:
    (1) Sixty-five days after the date of the notice provided under 
Sec. 30.22;

[[Page 58]]

    (2) If the debtor has requested an opportunity to inspect and copy 
records within the time period specified in paragraph (c) of this 
section, 15 days after the date on which the Secretary makes available 
to the debtor the relevant, requested records; or
    (3) If the debtor has requested a review within the appropriate time 
frame under paragraph (d) (1) or (2) of this section and the Secretary 
has provided an initial review by a guarantee agency, seven days after 
the date of the initial determination by the guarantee agency.
    (e) Notwithstanding the time frames under Sec. 30.24(d), a debtor 
shall file the documents specified under that paragraph with the request 
for review.
    (f) Notwithstanding the time frame under Sec. 30.27(a), a debtor 
must agree to repay the debt under terms acceptable to the Secretary and 
make the first payment due under the agreement by the latest of:
    (1) The seventh day after the date of decision of the Secretary if 
the debtor requested a review under Sec. 30.24;
    (2) The sixty-fifth day after the date of the notice under 
Sec. 30.22(b), if the debtor did not request a review under Sec. 30.24, 
or an opportunity to inspect and copy records of the Department under 
Sec. 30.23; or
    (3) The fifteenth day after the date on which the Secretary made 
available relevant records regarding the debt, if the debtor filed a 
timely request under Sec. 30.23(a).

(Authority: 20 U.S.C. 1221e-3(a)(1) and 1226a-1, 31 U.S.C. 3720A)

      Procedures for Reporting Debts to Consumer Reporting Agencies



Sec. 30.35  What procedures does the Secretary follow to report debts 
to consumer reporting agencies?

    (a)(1) The Secretary reports information regarding debts arising 
under a program or activity of the Department and held by the Department 
to consumer reporting agencies, in accordance with the procedures 
described in this section.
    (2) The term consumer reporting agency, as used in this section, has 
the same meaning as provided in 31 U.S.C. 3701(a)(3).
    (b) Before reporting information on a debt to a consumer reporting 
agency, the Secretary follows the procedures set forth in Sec. 30.33.

(Authority: 20 U.S.C. 1221e-3(a)(1) and 1226a-1, 31 U.S.C. 3711, 
Sec. 16023, 16029, Pub. L. 99-272)

Subpart D [Reserved]



    Subpart E_What Costs and Penalties Does the Secretary Impose on 
                           Delinquent Debtors?

    Source: 53 FR 33425, Aug. 30, 1988, unless otherwise noted.



Sec. 30.60  What costs does the Secretary impose on delinquent
debtors?

    (a) The Secretary may charge a debtor for the costs associated with 
the collection of a particular debt. These costs include, but are not 
limited to--
    (1) Salaries of employees performing Federal loan servicing and debt 
collection activities;
    (2) Telephone and mailing costs;
    (3) Costs for reporting debts to credit bureaus;
    (4) Costs for purchase of credit bureau reports;
    (5) Costs associated with computer operations and other costs 
associated with the maintenance of records;
    (6) Bank charges;
    (7) Collection agency costs;
    (8) Court costs and attorney fees; and
    (9) Costs charged by other Governmental agencies.
    (b) Notwithstanding any provision of State law, if the Secretary 
uses a collection agency to collect a debt on a contingent fee basis, 
the Secretary charges the debtor, and collects through the agency, an 
amount sufficient to recover--
    (1) The entire amount of the debt; and
    (2) The amount that the Secretary is required to pay the agency for 
its collection services.
    (c)(1) The amount recovered under paragraph (b) of this section is 
the entire amount of the debt, multiplied by the following fraction:
[GRAPHIC] [TIFF OMITTED] TC15NO91.009


[[Page 59]]


    (2) In paragraph (c)(1) of this section, cr equals the commission 
rate the Department pays to the collection agency.
    (d) If the Secretary uses more than one collection agency to collect 
similar debts, the commission rate (cr) described in paragraph (c)(2) of 
this section is calculated as a weighted average of the commission rates 
charged by all collection agencies collecting similar debts, computed 
for each fiscal year based on the formula
[GRAPHIC] [TIFF OMITTED] TC15NO91.010


where--

    (1) Xi equals the dollar amount of similar debts placed by the 
Department with an individual collection agency as of the end of the 
preceding fiscal year;
    (2) Yi equals the commission rate the Department pays to that 
collection agency for the collection of the similar debts;
    (3) Z equals the dollar amount of similar debts placed by the 
Department with all collection agencies as of the end of the preceding 
fiscal year; and
    (4) N equals the number of collection agencies with which the 
Secretary has placed similar debts as of the end of the preceding fiscal 
year.
    (e) If a debtor has agreed under a repayment or settlement agreement 
with the Secretary to pay costs associated with the collection of a debt 
at a specified amount or rate, the Secretary collects those costs in 
accordance with the agreement.
    (f) The Secretary does not impose collection costs against State or 
local governments under paragraphs (a) through (d) of this section.

(Authority: 20 U.S.C. 1221e-3(a)(1) and 1226a-1, 31 U.S.C. 3711(e), 
3717(e)(1), 3718))



Sec. 30.61  What penalties does the Secretary impose on delinquent
debtors?

    (a) If a debtor does not make a payment on a debt, or portion of a 
debt, within 90 days after the date specified in the first demand for 
payment sent to the debtor, the Secretary imposes a penalty on the 
debtor.
    (b)(1) The amount of the penalty imposed under paragraph (a) of this 
section is 6 percent per year of the amount of the delinquent debt.
    (2) The penalty imposed under this section runs from the date 
specified in the first demand for payment to the date the debt 
(including the penalty) is paid.
    (c) If a debtor has agreed under a repayment or settlement agreement 
with the Secretary to pay a penalty for failure to pay a debt when due, 
or has such an agreement under a grant or contract under which the debt 
arose, the Secretary collects the penalty in accordance with the 
agreement, grant, or contract.
    (d) The Secretary does not impose a penalty against State or local 
governments under paragraphs (a) and (b) of this section.

(Authority: 20 U.S.C. 1221e-3(a)(1) and 1226a-1, 31 U.S.C. 3711(e))



Sec. 30.62  When does the Secretary forego interest, administrative 
costs, or penalties?

    (a) For a debt of any amount based on a loan, the Secretary may 
refrain from collecting interest or charging administrative costs or 
penalties to the extent that compromise of these amounts is appropriate 
under the standards for compromise of a debt contained in 4 CFR part 
103.
    (b) For a debt not based on a loan the Secretary may waive, or 
partially waive, the charging of interest, or the collection of 
administrative costs or penalties, if--
    (1) Compromise of these amounts is appropriate under the standards 
for compromise of a debt contained in 4 CFR part 103; or
    (2) The Secretary determines that the charging of interest or the 
collection of administrative costs or penalties is--
    (i) Against equity and good conscience; or
    (ii) Not in the best interests of the United States.
    (c) The Secretary may exercise waiver under paragraph (b)(1) of this 
section without regard to the amount of the debt.

[[Page 60]]

    (d) The Secretary may exercise waiver under paragraph (b)(2) of this 
section if--
    (1) The Secretary has accepted an installment plan under 4 CFR 
102.11;
    (2) There is no indication of fault or lack of good faith on the 
part of the debtor; and
    (3) The amount of interest, administrative costs, and penalties is 
such a large portion of the installments that the debt may never be 
repaid if that amount is collected.
    (e)(1) The Secretary does not charge interest on any portion of a 
debt, other than a loan, owed by a person subject to 31 U.S.C. 3717 if 
the debt is paid within 30 days after the date of the first demand for 
payment.
    (2) The Secretary may extend the period under paragraph (e)(1) of 
this section if the Secretary determines that the extension is 
appropriate.

(Authority: 20 U.S.C. 1221e-3(a)(1) and 1226a-1, 31 U.S.C. 3711(e))



  Subpart F_What Requirements Apply to the Compromise of a Debt or the 
             Suspension or Termination of Collection Action?



Sec. 30.70  How does the Secretary exercise discretion to compromise 
a debt or to suspend or terminate collection of a debt?

    (a)(1) The Secretary uses the standards in the FCCS, 31 CFR part 
902, to determine whether compromise of a debt is appropriate if the 
debt arises under a program administered by the Department, unless 
compromise of the debt is subject to paragraph (b) of this section.
    (2) If the amount of the debt is more than $100,000, or such higher 
amount as the Department of Justice may prescribe, the Secretary refers 
a proposed compromise of the debt to the Department of Justice for 
approval, unless the compromise is subject to paragraph (b) of this 
section or the debt is one described in paragraph (e) of this section.
    (b) Under the provisions in 34 CFR 81.36, the Secretary may enter 
into certain compromises of debts arising because a recipient of a grant 
or cooperative agreement under an applicable Department program has 
spent some of these funds in a manner that is not allowable. For 
purposes of this section, neither a program authorized under the Higher 
Education Act of 1965, as amended (HEA), nor the Impact Aid Program is 
an applicable Department program.
    (c)(1) The Secretary uses the standards in the FCCS, 31 CFR part 
903, to determine whether suspension or termination of collection action 
on a debt is appropriate.
    (2) Except as provided in paragraph (e), the Secretary--
    (i) Refers the debt to the Department of Justice to decide whether 
to suspend or terminate collection action if the amount of the debt 
outstanding at the time of the referral is more than $100,000 or such 
higher amount as the Department of Justice may prescribe; or
    (ii) May suspend or terminate collection action if the amount of the 
debt outstanding at the time of the Secretary's determination that 
suspension or termination is warranted is less than or equal to $100,000 
or such higher amount as the Department of Justice may prescribe.
    (d) In determining the amount of a debt under paragraph (a), (b), or 
(c) of this section, the Secretary deducts any partial payments or 
recoveries already received, and excludes interest, penalties, and 
administrative costs.
    (e)(1) Subject to paragraph (e)(2) of this section, under the 
provisions of 31 CFR part 902 or 903, the Secretary may compromise a 
debt in any amount, or suspend or terminate collection of a debt in any 
amount, if the debt arises under the Federal Family Education Loan 
Program authorized under title IV, part B, of the HEA, the William D. 
Ford Federal Direct Loan Program authorized under title IV, part D of 
the HEA, or the Perkins Loan Program authorized under title IV, part E, 
of the HEA.
    (2) The Secretary refers a proposed compromise, or suspension or 
termination of collection, of a debt that exceeds $1,000,000 and that 
arises under a loan program described in paragraph (e)(1) of this 
section to the Department of Justice for review. The Secretary does not 
compromise, or suspend or

[[Page 61]]

terminate collection of, a debt referred to the Department of Justice 
for review until the Department of Justice has provided a response to 
that request.
    (f) The Secretary refers a proposed resolution of a debt to the 
Government Accountability Office (GAO) for review and approval before 
referring the debt to the Department of Justice if--
    (1) The debt arose from an audit exception taken by GAO to a payment 
made by the Department; and
    (2) The GAO has not granted an exception from the GAO referral 
requirement.
    (g) Nothing in this section precludes--
    (1) A contracting officer from exercising his authority under 
applicable statutes, regulations, or common law to settle disputed 
claims relating to a contract; or
    (2) The Secretary from redetermining a claim.
    (h) Nothing in this section authorizes the Secretary to compromise, 
or suspend or terminate collection of, a debt--
    (1) Based in whole or in part on conduct in violation of the 
antitrust laws; or
    (2) Involving fraud, the presentation of a false claim, or 
misrepresentation on the part of the debtor or any party having an 
interest in the claim.

(Authority: 20 U.S.C. 1082(a) (5) and (6), 1087a, 1087hh, 1221e-3(a)(1), 
1226a-1, and 1234a, 31 U.S.C. 3711)

[81 FR 76070, Nov. 1, 2016]

Subpart G [Reserved]



PART 31_SALARY OFFSET FOR FEDERAL EMPLOYEES WHO ARE INDEBTED TO THE 
UNITED STATES UNDER PROGRAMS ADMINISTERED BY THE SECRETARY OF EDUCATION
--Table of Contents



Sec.
31.1  Scope.
31.2  Definitions.
31.3  Pre-offset notice.
31.4  Request to inspect and copy documents relating to a debt.
31.5  Request for hearing on the debt or the proposed offset.
31.6  Location and timing of oral hearing.
31.7  Hearing procedures.
31.8  Rules of decision.
31.9  Decision of the hearing official.
31.10  Request for repayment agreement.
31.11  Offset process.

    Authority: 5 U.S.C. 5514; 31 U.S.C. 3716.

    Source: 54 FR 31821, Aug. 19, 1989, unless otherwise noted.



Sec. 31.1  Scope.

    (a) General. The Secretary establishes the standards and procedures 
in this part that apply to the offset from disposable pay of a current 
or former Federal employee or from amounts payable from the Federal 
retirement account of a former Federal employee to recover a debt owed 
the United States under a program adminstered by the Secretary of 
Education.
    (b) Exclusions. This part does not apply to--
    (1) Offsets under 34 CFR part 32 to recover for overpayments of pay 
or allowances to an employee of the Department;
    (2) Offsets under 34 CFR part 30; or
    (3) Offsets under section 124 of Pub. L. 97-276 to collect debts 
owed to the United States on judgments.
    (c) Reports to consumer reporting agency. The Secretary may report a 
debt to a consumer reporting agency after notifying the employee, in 
accordance with 34 CFR 30.35, of the intention to report the debt, and 
after providing the employee an opportunity to inspect documents, 
receive a hearing, and enter into a repayment agreement under this part.

(Authority: 5 U.S.C. 5514; 31 U.S.C. 3711; 31 U.S.C. 3716)



Sec. 31.2  Definitions.

    As used in this part:
    Agency means--
    (1) An Executive agency as defined in 5 U.S.C. 105, including the 
U.S. Postal Service and the U.S. Postal Rate Commission;
    (2) A military department as defined in 5 U.S.C. 102;
    (3) An agency or court in the judicial branch, including a court as 
defined in 28 U.S.C. 610, the District Court for the Northern Mariana 
Islands, and the Judicial Panel on Multidistrict Litigation;

[[Page 62]]

    (4) An agency of the legislative branch, including the U.S. Senate 
and the U.S. House of Representatives; and
    (5) Any other independent establishment that is an entity of the 
Federal Government.
    Days refer to calendar days.
    Department means the Education Department.
    Disposable pay means the amount that remains from an employee's pay 
after required deductions for Federal, State, and local income taxes; 
Social Security taxes, including Medicare taxes; Federal retirement 
programs; premiums for basic life insurance and health insurance 
benefits; and such other deductions that are required by law to be 
withheld.
    Employee means a current or former employee of an agency. In the 
case of an offset proposed to collect a debt owed by a deceased 
employee, the references in this part to the employee shall be read to 
refer to the payee of benefits from the Federal retirement account or 
other pay of the employee.
    Federal retirement account means an account of an employee under the 
Civil Service Retirement System or the Federal Employee Retirement 
System.
    Offset means a deduction from the pay of an employee, or a payment 
due from the Federal retirement account of an employee, to satisfy a 
debt.
    Pay means basic pay, special pay, incentive pay, retired pay, 
retainer pay, or, in the case of an individual not entitled to basic 
pay, other authorized pay, including severance pay or lump sum payments 
for accrued annual leave, and amounts payable from the Federal 
retirement account of an employee.
    Secretary means the Secretary of the Department of Education or an 
official or employee of the Department acting for the Secretary under a 
delegation of authority.

(Authority: 5 U.S.C. 5514; 31 U.S.C. 3716)



Sec. 31.3  Pre-offset notice.

    (a) At least 65 days before initiating an offset against the pay of 
an employee, the Secretary sends a written notice to the employee 
stating--
    (1) The nature and amount of the debt;
    (2) A demand for payment of the debt;
    (3) The manner in which the Secretary charges interest, 
administrative costs, and penalties on the debt;
    (4) The Secretary's intention to collect the debt by offset 
against--
    (i) 15 percent of the employee's current disposable pay; and
    (ii) If the debt cannot be satisfied by offset against current 
disposable pay, a specified amount of severance pay, a lump sum annual 
leave payment, a final salary check, or payments from the Federal 
retirement account of the employee;
    (5) The amount, frequency, approximate beginning date and duration 
of the proposed offset;
    (6) The employee's opportunity to--
    (i) Inspect and copy Department records pertaining to the debt;
    (ii) Obtain a pre-offset hearing before a hearing official who is 
not under the control or supervision of the Secretary regarding the 
existence or amount of the debt, or the proposed offset schedule; and
    (iii) Enter into a written agreement with the Secretary to repay the 
debt;
    (7) The date by which the employee must request an opportunity set 
forth under paragraph (a)(6) of this section;
    (8) The grounds for objecting to collection of the debt by offset;
    (9) The applicable hearing procedures and requirements;
    (10) That the Secretary grants any request for access to records, 
for a hearing, or for a satisfactory repayment agreement made by an 
employee;
    (11) That the Secretary does not delay the start of the proposed 
offset, or suspend an offset already commenced, unless--
    (i) An employee makes the request for access to records or for a 
hearing, or enters into a repayment agreement that is acceptable to the 
Secretary, before the deadlines described in this part; or
    (ii) An employee requests a hearing after the deadlines established 
in Sec. 31.5(a), but submits evidence satisfactory to the Secretary that 
the request was not made in a timely manner because the employee did not 
have notice of the proposed offset, or was prevented

[[Page 63]]

from making the request by factors beyond his or her control, until 
after the deadlines had passed;
    (12) That a final decision on the hearing will be issued not later 
than 60 days after the date on which the employee files a request for a 
hearing under Sec. 31.5, unless a delay in the proceedings is granted at 
the request of the employee;
    (13) That submission by the employee of knowingly false statements, 
representations or evidence may subject the employee to applicable 
disciplinary procedures, or civil or criminal penalties; and
    (14) That any amounts paid or collected by offset on a debt later 
determined to be unenforceable or canceled will be refunded to the 
employee.
    (b)(1) In determining whether an employee has requested an 
opportunity set forth under paragraph (a)(6) of this section in a timely 
manner, the Secretary relies on--
    (i) A legibly dated U.S. Postal Service postmark for the employee's 
request; or
    (ii) A legibly stamped U.S. Postal Service mail receipt for the 
employee's request.
    (2) The Secretary does not rely on either of the following as proof 
of mailing:
    (i) A private metered postmark.
    (ii) A mail receipt that is not dated by the U.S. Postal Service.
    (c) Payment by offset under this part of all or part of a debt does 
not constitute an acknowledgment of the debt or a waiver of rights 
available to the employee under this part or other applicable law if the 
employee has not agreed in writing to the offset.

(Authority: 5 U.S.C. 5514; 31 U.S.C. 3716)



Sec. 31.4  Request to inspect and copy documents relating to a debt.

    (a) The Secretary makes available for inspection and copying before 
offset under this part those Department documents that relate to the 
debt, if the employee--
    (1) Files a written request to inspect and copy the documents within 
20 days of the date of the pre-offset notice under Sec. 31.3, and
    (2) Files the request at the address specified in that notice.
    (b) A request filed under paragraph (a)(1) of this section must 
contain--
    (1) All information provided to the employee in the pre-offset 
notice under Sec. 31.3 that identifies the employee and the debt, 
including the employee's Social Security number and the program under 
which the debt arose, together with any corrections of that identifying 
information; and
    (2) A reasonably specific identification of the documents that the 
employee wishes to have available for inspection and copying.
    (c) The Secretary makes available documents for inspection and 
copying upon request by the employee. However, the Secretary may 
initiate an offset before making the requested documents available if 
the employee fails to request inspection and copying in accordance with 
this section.

(Authority: 5 U.S.C. 5514; 31 U.S.C. 3716)



Sec. 31.5  Request for hearing on the debt or the proposed offset.

    (a) Deadlines. (1) The Secretary provides a hearing before offset on 
the existence, amount, or enforceability of the debt described in the 
pre-offset notice provided under Sec. 31.3, or on the amount or 
frequency of the offsets as proposed in that notice, if the employee--
    (i) Files a request for the hearing within the later of--
    (A) 65 days after the date of the pre-offset notice provided under 
Sec. 31.3; or
    (B) 15 days after the date on which the Secretary makes available to 
the employee the relevant, requested documents if the employee had 
requested an opportunity to inspect and copy documents within 20 days of 
the date of the pre-offset notice provided under Sec. 31.3; and
    (ii) Files a request at the address specified in that notice.
    (2) The Secretary provides a hearing upon request by the employee. 
However, if the employee does not submit, within the deadlines in 
paragraph (a)(1) of this section, a request that meets the requirements 
of paragraphs (b) and (c) of this section, the Secretary does not delay 
the start of an offset, or suspend an offset already commenced, unless 
the employee submits evidence satisfactory to the Secretary that the

[[Page 64]]

request was not made in a timely manner because the employee did not 
have notice of the proposed offset, or was otherwise prevented from 
making the request by factors beyond his or her control, until after the 
deadlines had passed.
    (b) Contents of request for a hearing. A request for a hearing must 
contain--
    (1) All information provided to the employee in the pre-offset 
notice under Sec. 31.3 that identifies the employee and the particular 
debt, including the employee's Social Security number and the program 
under which the debt arose, together with any corrections needed with 
regard to that identifying information;
    (2) An explanation of the reasons why the employee believes that--
    (i) The debt as stated in the pre-offset notice is not owing or is 
not enforceable by offset; or
    (ii) The amount of the proposed offset described in the pre-offset 
notice will cause extreme financial hardship to the employee;
    (3) If the employee contends that the amount of the proposed offset 
will cause extreme financial hardship under the standards set forth in 
Sec. 31.8(b)--
    (i) An alternative offset proposal;
    (ii) An explanation, in writing, showing why the offset proposed in 
the notice would cause an extreme financial hardship for the employee; 
and
    (iii) Documents that show for the employee and for the spouse and 
dependents of the employee, for the one-year period preceding the 
Secretary's notice and for the repayment period proposed by the employee 
in his or her offset schedule--
    (A) Income from all sources,
    (B) Assets,
    (C) Liabilities,
    (D) Number of dependents,
    (E) Expenses for food, housing, clothing, and transportation,
    (F) Medical expenses, and
    (G) Exceptional expenses, if any; and
    (4) Copies of all documents that the employee wishes to have 
considered to support the objections raised by the employee regarding 
the enforceability of the debt or the claim of extreme financial 
hardship.
    (c) Request for oral hearing. (1) If the employee wants the hearing 
to be conducted as an oral hearing, the employee must submit a request 
that contains the information listed in paragraph (b) and must include 
with the request--
    (i) An explanation of reasons why the employee believes that the 
issues raised regarding the enforceability of the debt or a claim of 
extreme financial hardship cannot be resolved adequately by a review of 
the written statements and documents provided with the request for a 
hearing;
    (ii) An identification of--
    (A) The individuals that the employee wishes to have testify at the 
oral hearing;
    (B) The specific issues about which each individual is prepared to 
testify; and
    (C) The reasons why each individual's testimony is necessary to 
resolve the issue.
    (2) The Secretary grants a request for an oral hearing if--
    (i) The employee files a request for an oral hearing that meets the 
requirements of paragraphs (b) and (c) of this section; and
    (ii) The Secretary determines that the issues raised by the employee 
require a determination of the credibility of testimony and cannot be 
adequately resolved by a review of the written statements and documents 
submitted by the employee and documents contained in the Department's 
records relating to the debt.
    (3) The Secretary may decline a request for an oral hearing if the 
Secretary accepts the employee's proffer of testimomy made in the 
request for an oral hearing under paragraph (c)(1) of this section, and 
considers the facts at issue to be established as stated by the employee 
in the request.
    (4) If the Secretary grants a request for an oral hearing, the 
Secretary--
    (i) Notifies the employee in writing of--
    (A) The date, time, and place of the hearing;
    (B) The name and address of the hearing official;
    (C) The employee's right to be represented at the hearing by counsel 
or other representatives;
    (D) The employee's right to present and cross-examine witnesses; and

[[Page 65]]

    (E) The employee's right to waive the requested oral hearing and 
receive a hearing in the written record; and
    (ii) Provides the hearing official with a copy of all written 
statements submitted by the employee with the request for a hearing, and 
all documents pertaining to the debt or the amount of the offset 
contained in the Department's files on the debt or submitted with the 
request for a hearing.
    (d) Employee choice of oral hearing or hearing on written 
submissions. An employee who has been sent notice under paragraph (c)(4) 
that an oral hearing will be provided must, within 15 days of the date 
of that notice, state in writing to the hearing official and the 
Secretary--
    (1) Whether the employee intends to proceed with the oral hearing, 
or wishes a decision based on the written record; and
    (2) Any changes in the list of the witnesses the employee proposes 
to produce for the hearing, or the facts about which a witness will 
testify.
    (e) Dismissal of request for hearing. The Secretary considers the 
employee to have waived the request for a hearing of any kind--
    (1) If an employee does not provide the hearing official in a timely 
manner the written statement required under paragraph (d) of this 
section; or
    (2) If the employee does not appear for a scheduled oral hearing.

(Authority: 5 U.S.C. 5514; 31 U.S.C. 3716)



Sec. 31.6  Location and timing of oral hearing.

    (a) If the Secretary grants a request for an oral hearing, the 
Secretary selects the time, date, and location of the hearing. The 
Secretary selects, to the extent feasible, the location that is most 
convenient for the employee.
    (b) For a current military employee, the Secretary selects the time, 
date, and location of the hearing after consultation with the Secretary 
of Defense.
    (c) For a current Coast Guard employee, the Secretary selects the 
time, date, and location of the hearing after consultation with the 
Secretary of Transportation.
    (d) For an employee not described in paragraph (a) or (b) of this 
section, the hearing will be held in Washington, DC, or in one of the 
following cities: Boston, Philadelphia, New York, Atlanta, Chicago, 
Dallas, Kansas City, Denver, San Francisco, or Seattle.

(Authority: 5 U.S.C. 5514; 31 U.S.C. 3716)



Sec. 31.7  Hearing procedures.

    (a) Independence of hearing official. A hearing provided under this 
part is conducted by a hearing official who is neither an employee of 
the Department nor otherwise under the supervision or control of the 
Secretary.
    (b) Lack of subpoena authority or formal discovery. (1) Neither the 
hearing official nor the Secretary has authority to issue subpoenas to 
compel the production of documents or to compel the attendance of 
witnesses at an oral hearing under this part. The Secretary will attempt 
to make available during an oral hearing the testimony of a current 
official of the Department if--
    (i) The employee had identified the official in the request for a 
hearing under Sec. 31.5(b) and demonstrated that the testimony of the 
official is necessary to resolve adequately an issue of fact raised by 
the employee in the request for a hearing; and
    (ii) The Secretary determines that the responsibilities of the 
official permit his or her attendance at the hearing.
    (2) If the Secretary determines that the testimony of a Department 
official is necessary, but that the official cannot attend an oral 
hearing to testify, the Secretary attempts to make the official 
available for testimony at the hearing by means of a telephone 
conference call.
    (3) No discovery is available in a proceeding under this part except 
as provided in Sec. 31.4.
    (c) Hearing on written submissions. If a hearing is conducted on the 
written submissions, the hearing official reviews documents and 
responses submitted by the Secretary and the employee under Sec. 31.5.
    (d) Conduct of oral hearing. (1) The hearing official conducts an 
oral hearing as an informal proceeding. The official--
    (i) Administers oaths to witnesses;
    (ii) Regulates the course of the hearing;

[[Page 66]]

    (iii) Considers the introduction of evidence without regard to the 
rules of evidence applicable to judicial proceedings; and
    (iv) May exclude evidence that is redundant, or that is not relevant 
to those issues raised by the employee in the request for hearing under 
Sec. 31.5 that remain in dispute.
    (2) An oral hearing is generally open to the public. However, the 
hearing official may close all or any portion of the hearing if doing so 
is in the best interest of the employee or the public.
    (3) The hearing official may conduct an oral hearing by telephone 
conference call--
    (i) If the employee is located in a city outside the Washington, DC 
Metropolitan area.
    (ii) At the request of the employee.
    (iii) At the discretion of the hearing official.
    (4) No written record is created or maintained of an oral hearing 
provided under this part.
    (e) Burden of proof. In any hearing under this part--
    (1) The Secretary bears the burden of proving, by a preponderance of 
the evidence, the existence and amount of the debt, and the failure of 
the employee to repay the debt, as the debt is described in the pre-
offset notice provided under Sec. 31.3; and
    (2) The employee bears the burden of proving, by a preponderance of 
the evidence--
    (i) The existence of any fact that would establish that the debt 
described in the pre-offset notice is not enforceable by offset; and
    (ii) The existence of any fact that would establish that the amount 
of the proposed offset would cause an extreme financial hardship for the 
employee.

(Authority: 5 U.S.C. 5514; 31 U.S.C. 3716)



Sec. 31.8  Rules of decision.

    (a) Enforceability of debt by offset. In deciding whether the 
Secretary has established that the debt described in the pre-offset 
under Sec. 31.3 is owed by the employee, or whether the employee has 
established that the debt is not enforceable by offset, the hearing 
official shall apply the principles in this paragraph.
    (1) The statutes and Department regulations authorizing and 
implementing the program under which the debt arose must be applied in 
accordance with official written interpretations by the Department.
    (2) The principles of res judicata and collateral estoppel apply to 
resolution of disputed facts in those instances in which the debt or 
material facts in dispute have been the subject of prior judicial 
decision.
    (3) The act or omission of an institution of higher education at 
which the employee was enrolled does not constitute a defense to 
repayment of an obligation with regard to a grant or loan under a 
program authorized under Title IV of the Higher Education Act or similar 
authority, except to the extent that--
    (i) The act or omission constitutes a defense to the debt under 
applicable Federal or State law;
    (ii) The institution owed the employee a refund under its refund 
policy and failed to pay that refund to the employee or to a lender 
holding a loan made to the employee; or
    (iii) The institution ceased teaching activity while the employee 
was in attendance and during the academic period for which the grant or 
loan was made, and failed to refund to the employee or holder of a loan 
to the employee a proportionate amount of the grant or loan funds used 
to pay tuition and other institutional charges for that academic period.
    (4)(i) A debt otherwise established as owed by the employee is 
enforceable by offset under this part if the Secretary sends the pre-
offset notice for the debt within the ten year period following the 
later of--
    (A) The date on which the Secretary acquired the debt by assignment 
or referral, or
    (B) The date of a subsequent partial payment reaffirming the debt.
    (ii) Periods during which the statute of limitations applicable to a 
lawsuit to collect the debt has been tolled under 11 U.S.C. 108, 28 
U.S.C. 2416, 50 U.S.C. App. 525, or other authority are excluded from 
the calculation of the ten year period described in paragraph (a)(4)(i) 
of this section.

[[Page 67]]

    (b) Extreme financial hardship. (1) In deciding whether an employee 
has established that the amount of the proposed offset would cause 
extreme financial hardship to the employee, the hearing official shall 
determine whether the credible, relevant evidence submitted demonstrates 
that the proposed offset would prevent the employee from meeting the 
costs necessarily incurred for essential subsistence expenses of the 
employee and his or her spouse and dependents.
    (2) For purposes of this determination, essential subsistence 
expenses include costs incurred only for food, housing, clothing, 
essential transportation and medical care.
    (3) In making this determination, the hearing official shall 
consider--
    (i) The income from all sources of the employee, and his or her 
spouse and dependents;
    (ii) The extent to which the assets of the employee and his or her 
spouse and dependents are available to meet the offset and the essential 
subsistence expenses;
    (iii) Whether these essential subsistence expenses have been 
minimized to the greatest extent possible;
    (iv) The extent to which the employee and his or her spouse and 
dependents can borrow to satisfy the debt to be collected by offset or 
to meet essential expenses; and
    (v) The extent to which the employee and his or her spouse and 
dependents have other exceptional expenses that should be taken into 
account, and whether these expenses have been minimized.

(Authority: 5 U.S.C. 5514; 31 U.S.C. 3716)



Sec. 31.9  Decision of the hearing official.

    (a) The hearing official issues a written opinion within sixty days 
of the date on which the employee filed a request for a hearing under 
Sec. 31.5, unless a delay in the proceedings has been granted at the 
request of the employee. In the opinion, the hearing official states his 
or her decision and the findings of fact and conclusions of law on which 
the decision is based.
    (b) If the hearing official finds that a portion of the debt 
described in the pre-offset notice under Sec. 31.3 is not enforceable by 
offset, the official shall state in the opinion that portion which is 
enforceable by offset.
    (c) If the hearing official finds that the amount of the offset 
proposed in the pre-offset notice will cause an extreme financial 
hardship for the employee, the hearing official shall establish an 
offset schedule that will result in the repayment of the debt in the 
shortest period of time without producing an extreme financial hardship 
for the employee.

(Authority: 5 U.S.C. 5514; 31 U.S.C. 3716)



Sec. 31.10  Request for repayment agreement.

    (a) The Secretary does not initiate an offset under this part if the 
employee agrees in writing to repay the debt under terms acceptable to 
the Secretary and makes the first payment due under the agreement on or 
before the latest of--
    (1) The seventh day after the date of the decision of the hearing 
official, if the employee timely requested a hearing under Sec. 31.5 (a) 
and (d);
    (2) The sixty-fifth day after the date of the pre-offset notice 
under Sec. 31.3 if the employee did not timely request either a hearing 
in accordance with Sec. 31.5 (a) and (d) or an opportunity to inspect 
and copy documents related to the debt under Sec. 31.4; or
    (3) The fifteenth day after the date on which the Secretary made 
available documents related to the debt, if the employee filed a timely 
request for documents under Sec. 31.4.
    (b) In the agreement, the Secretary and the employee may agree to 
satisfaction of the debt from sources other than an offset under this 
part, or may modify the amount proposed to be offset in the pre-offset 
notice or estimated in the decision of the hearing official.
    (c) If the employee does not enter into a repayment agreement 
acceptable to the Secretary within the deadlines in this section, the 
Secretary may initiate an offset under this part. The Secretary 
continues to collect by offset until an employee enters in a 
satisfactory repayment agreement for the debt. The Secretary suspends an 
offset

[[Page 68]]

already commenced under circumstances described in Sec. 31.5(a)(2).

(Authority: 5 U.S.C. 5514; 31 U.S.C. 3716)



Sec. 31.11  Offset process.

    (a) The Secretary attempts to collect debts under this part within 
the shortest time authorized under--
    (1) The offset schedule proposed in the pre-offset notice, unless 
modified by agreement or by the decision of a hearing official;
    (2) A written repayment agreement with the employee; or
    (3) The offset schedule established in the decision of the hearing 
official.
    (b) In proposing an offset schedule under Sec. 31.3 or establishing 
a repayment agreement under Sec. 31.10, the Secretary also considers the 
expected period of Federal employment of the employee.
    (c) Unless the Secretary determines, in his discretion, to delay or 
suspend collection, the Secretary effects an offset under this part--
    (1) According to the terms agreed to by the employee pursuant to a 
timely request under Sec. 31.10 to enter into a repayment agreement; or,
    (2) After the deadlines in Sec. 31.10(b) for requesting a repayment 
agreement with the Secretary.
    (d) If the employee retires, resigns, or leaves Federal employment 
before the debt is satisfied, the Secretary collects the amount 
necessary to satisfy the debt by offset from subsequent payments of any 
kind, including a final salary payment or a lump sum annual leave 
payment, due the employee on the date of separation. If the debt cannot 
be satisfied by offset from any such final payment due the employee on 
the date of separation, the Secretary collects the debt from later 
payments of any kind due the employee in accordance with the provisions 
of 4 CFR 102.4.
    (e) The Secretary effects an offset under this part against payments 
owing to an employee of another Federal agency after completion of the 
requirements of this part, in accordance with the provisions of 5 CFR 
550.1108.

(Authority: 5 U.S.C. 5514; 31 U.S.C. 3716)



PART 32_SALARY OFFSET TO RECOVER OVERPAYMENTS OF PAY OR ALLOWANCES
FROM DEPARTMENT OF EDUCATION EMPLOYEES--Table of Contents



Sec.
32.1  Scope.
32.2  Definitions.
32.3  Pre-offset notice.
32.4  Employee response.
32.5  Pre-offset hearing--general.
32.6  Request for a pre-offset hearing.
32.7  Pre-offset oral hearing.
32.8  Pre-offset hearing on the written submissions.
32.9  Written decision.
32.10  Deductions process.

    Authority: 5 U.S.C. 5514; 31 U.S.C. 3716.

    Source: 52 FR 24957, July 1, 1987, unless otherwise noted.



Sec. 32.1  Scope.

    (a) The Secretary establishes the standards and procedures in this 
part that apply to the deductions through offset from disposable pay of 
a current or former employee of the Department of Education to recover 
overpayments of pay or allowances.
    (b) This part does not apply to--
    (1) Recovery through offset of an indebtedness to the United States 
by an employee of the Department under a program administered by the 
Secretary of Education covered under 34 CFR part 31;
    (2) The offset of an indebtedness to the United States by a Federal 
employee to satisfy a judgment obtained by the United States against 
that employee in a court of the United States;
    (3) The offset of any payment to an employee of the Department of 
Education which is expressly allowed under statutes other than 5 U.S.C. 
5514, except as to offsets of severance pay and/or lump sum annual leave 
payments as authorized under 31 U.S.C. 3716;
    (4) Offsets under 34 CFR part 30; or
    (5) An employee election of coverage or of a change of coverage 
under a Federal benefits program which requires periodic deductions from 
pay if the amount to be recovered was accumulated over four pay periods 
or less.

(Authority: 5 U.S.C. 5514; 31 U.S.C. 3716)

[[Page 69]]



Sec. 32.2  Definitions.

    The following definitions apply to this part:
    Department means the Department of Education.
    Disposable pay means the amount that remains from an employee's pay 
after required deductions for Federal, State, and local income taxes; 
Social Security taxes, including Medicare taxes; Federal retirement 
programs; premiums for health and basic life insurance benefits; and 
such other deductions that are required by law to be withheld.
    Employee means a current or former employee of the Department.
    Former employee means a former employee of the Department who is 
entitled to pay from the Department or another agency.
    Pay means basic pay, special pay, incentive pay, retired pay, 
retainer pay, or, in the case of an individual not entitled to basic 
pay, other authorized pay, including severance pay and/or lump sum 
payments for accrued annual leave.
    Paying agency means a Federal agency currently employing an 
individual and authorizing the payment of his or her current pay.
    Secretary means the Secretary of the Department of Education or an 
official or employee of the Department acting for the Secretary under a 
delegation of authority.

(Authority: 5 U.S.C. 5514; 31 U.S.C. 3716)



Sec. 32.3  Pre-offset notice.

    At least 30 days before initiating a deduction from the disposable 
pay of an employee to recover an overpayment of pay or allowances, the 
Secretary sends a written notice to the employee stating--
    (a) The origin, nature and amount of the overpayment;
    (b) How interest is charged and administrative costs and penalties 
will be assessed, unless excused under 31 U.S.C. 3716;
    (c) A demand for repayment, providing for an opportunity for the 
employee to enter into a written repayment agreement with the 
Department;
    (d) Where a waiver of repayment is authorized by law, the employee's 
right to request a waiver;
    (e) The Department's intention to deduct 15 percent of the 
employee's disposable pay, or a specified amount if the disposable pay 
is severance pay and/or a lump sum annual leave payment, to recover the 
overpayment if a waiver is not granted by the Secretary and the employee 
fails to repay the overpayment or enter into a written repayment 
agreement;
    (f) The amount, frequency, approximate beginning date and duration 
of the intended deduction;
    (g) If Government records on which the determination of overpayment 
are not attached, how those records will be made available to the 
employee for inspection and copying;
    (h) The employee's right to request a pre-offset hearing concerning 
the existence or amount of the overpayment or an involuntary repayment 
schedule;
    (i) The applicable hearing procedures and requirements, including a 
statement that a timely petition for hearing will stay commencement of 
collection proceedings and that a final decision on the hearing will be 
issued not later than 60 days after the hearing petition is filed, 
unless a delay is requested and granted;
    (j) That any knowingly false or frivolous statements, 
representations or evidence may subject the employee to applicable 
disciplinary procedures, civil or criminal penalties; and
    (k) That where amounts paid or deducted are later waived or found 
not owed, unless otherwise provided by law, they will be promptly 
refunded to the employee.

(Authority: 5 U.S.C. 5514, 31 U.S.C. 3716)



Sec. 32.4  Employee response.

    (a) Voluntary repayment agreement. Within 7 days of receipt of the 
written notice under Sec. 32.3, the employee may submit a request to the 
Secretary to arrange for a voluntary repayment schedule. To arrange for 
a voluntary repayment schedule, the employee shall submit a financial 
statement and sign a written repayment agreement

[[Page 70]]

approved by the Secretary. An employee who arranges for a voluntary 
repayment schedule may nonetheless request a waiver of the overpayment 
under paragraph (b) of this section.
    (b) Waiver. An employee seeking a waiver of collection of the debt 
that is authorized by law must request the waiver in writing to the 
Secretary within 10 days of receipt of the written notice under 
Sec. 32.3. The employee must state why he or she believes a waiver 
should be granted.
    (c) Involuntary repayment schedule. If the employee claims that the 
amount of the involuntary deduction will cause extreme financial 
hardship and should be reduced, he or she must submit a written 
explanation and a financial statement signed under oath or affirmation 
to the Secretary within 10 days of receipt of the written notice under 
Sec. 32.3. An employee who fails to submit this financial information in 
a timely manner waives the right to object to the involuntary repayment 
schedule at a hearing under Sec. 32.5. The Secretary notifies the 
employee, in writing, whether the Secretary will reduce the rate of the 
involuntary deduction.

(Authority: 5 U.S.C. 5514; 31 U.S.C. 3716)



Sec. 32.5  Pre-offset hearing--general.

    (a) An employee who wishes a review of the existence or amount of 
the overpayment or an involuntary repayment schedule may request a pre-
offset hearing. The pre-offset hearing does not review:
    (1) The denial of a waiver of repayment under 5 U.S.C. 5584;
    (2) The involuntary repayment schedule or financial hardship caused 
by the amount of the involuntary deduction from the employee's 
disposable pay, unless the employee has submitted the financial 
statement and written explanation required under Sec. 32.4(c); and
    (3) The determination under paragraph (b) of this section that the 
pre-offset hearing is on the written submissions.
    (b) Unless the Secretary determines that a matter reviewable under 
paragraph (a) of this section turns on an issue of credibility or 
veracity or cannot be resolved by a review of the documentary evidence, 
the pre-offset hearing is on the written submissions.
    (c) A pre-offset hearing is based on the written submissions for 
overpayments arising from:
    (1) A termination of a temporary promotion;
    (2) A cash award;
    (3) An erroneous salary rate;
    (4) Premature granting of a within-grade increase;
    (5) A lump sum payment for annual leave;
    (6) Unauthorized appointment to a position;
    (7) An error on time and attendance records; or
    (8) Other circumstances where the Secretary determines that an oral 
hearing is not required.
    (d) The hearing is conducted by a hearing official who is not an 
employee of the Department or under the supervision or control of the 
Secretary.
    (e) Formal discovery between the parties is not provided.

(Authority: 5 U.S.C. 5514; 31 U.S.C. 3716)



Sec. 32.6  Request for a pre-offset hearing.

    (a) Except for an employee who has requested a waiver of collection 
of the debt under Sec. 32.4(b), an employee who wishes a pre-offset 
hearing must request the hearing within 15 days of receipt of the 
written notice given under Sec. 32.3. The Secretary waives the 15-day 
requirement if the employee shows that the delay was because of 
circumstances beyond his or her control or because of failure to receive 
notice and lack of knowledge of the time limit.
    (b) An employee who has requested a waiver under Sec. 32.4(b) may 
request a hearing within 10 days of receipt of a determination by the 
Secretary denying a waiver.
    (c) The request for a hearing must:
    (1) Be in writing;
    (2) State why the employee:
    (i) Contests the existence or amount of the overpayment; or
    (ii) Claims that the involuntary repayment schedule will cause 
extreme financial hardship;
    (3) Include all documents on which the employee is relying, other 
than those provided by the Secretary under Sec. 32.3; any document which 
is a statement of an individual must be in the form of an affidavit; and

[[Page 71]]

    (4) Be submitted to the designated hearing official with a copy to 
the Secretary.
    (d) If the employee timely requests a pre-offset hearing or the 
timelines are waived under paragraph (a) of this section, the Secretary:
    (1) Notifies the employee whether the employee may elect an oral 
hearing; and
    (2) Provides the hearing official with a copy of all records on 
which the determination of the overpayment and any involuntary repayment 
schedule are based.
    (e) An employee who has been given the opportunity to elect an oral 
hearing and who does elect an oral hearing must notify the hearing 
official and the Secretary of his or her election in writing within 7 
days of receipt of the notice under paragraph (d)(1) of this section and 
must identify all proposed witnesses and all facts and evidence about 
which they will testify.
    (f) Where an employee requests an oral hearing, the hearing official 
notifies the Secretary and the employee of the date, time, and location 
of the hearing. However:
    (1) The employee subsequently may elect to have the hearing based 
only on the written submissions by notifying the hearing official and 
the Secretary at least 3 calendar days before the date of the oral 
hearing. The hearing official may waive the 3-day requirement for good 
cause when the employee notifies the hearing official before the date of 
the hearing; and
    (2) The request for a hearing of an employee who fails to appear at 
the oral hearing must be dismissed and the Secretary's decision 
affirmed.

(Authority: 5 U.S.C. 5514; 31 U.S.C. 3716)



Sec. 32.7  Pre-offset oral hearing.

    (a) Oral hearings are informal in nature. The Secretary and the 
employee, through their representatives, and by reference to the 
documentation submitted, explain their case. The employee may testify on 
his or her own behalf, subject to cross examination. Other witnesses may 
be called to testify only where the hearing official determines that 
their testimony is relevant and not redundant.
    (b) The hearing official shall:
    (1) Conduct a fair and impartial hearing; and
    (2) Preside over the course of the hearing, maintain decorum, and 
avoid delay in the disposition of the hearing.
    (c) The employee may represent himself or herself or may be 
represented by another person at the hearing. The employee may not be 
represented by a person whose representation creates an actual or 
apparent conflict of interest.
    (d) Oral hearings are open to the public. However, the hearing 
official may close all or any portion of the hearing where to do so is 
in the best interests of the employee or the public.
    (e) Oral hearings may be conducted by conference call--
    (1) If the employee is located in a city outside the Washington, DC 
Metropolitan area;
    (2) At the request of the employee; or
    (3) At the discretion of the hearing official.

(Authority: 5 U.S.C. 5514; 31 U.S.C. 3716)



Sec. 32.8  Pre-offset hearing on the written submissions.

    If a hearing is to be held on the written submissions, the hearing 
official reviews the records and responses submitted by the Secretary 
and the employee under Sec. 32.6.

(Authority: 5 U.S.C. 5514; 31 U.S.C. 3716)



Sec. 32.9  Written decision.

    (a) The hearing official issues a written decision stating the facts 
supporting the nature and origin of the debt and the hearing official's 
analysis, findings and conclusions as to the amount of the debt and the 
repayment schedule within 60 days of filing of the employee's request 
for a pre-offset hearing, unless the employee requests, and the hearing 
official grants, a delay in the proceedings.
    (b) The hearing official decides whether the Secretary's 
determination of the existence and the amount of the overpayment or the 
extreme financial hardship caused by the involuntary repayment schedule 
is clearly erroneous. A determination is clearly erroneous if although 
there is evidence to support the determination, the hearing official, 
considering the record as a whole, is

[[Page 72]]

left with a definite and firm conviction that a mistake was made.
    (c) In making the decision, the hearing official is governed by 
applicable Federal statutes, rules and regulations.
    (d) The hearing official decides the issue of extreme financial 
hardship caused by the involuntary repayment schedule only where the 
employee has submitted the financial statement and written explanation 
required under Sec. 32.4(c). Where the hearing official determines that 
the involuntary repayment schedule creates extreme financial hardship, 
he or she must establish a schedule that alleviates the financial 
hardship but may not reduce the involuntary repayment schedule to a 
deduction of zero percent.

(Authority: 5 U.S.C. 5514; 31 U.S.C. 3716)



Sec. 32.10  Deductions process.

    (a) Debts must be collected in one lump sum where possible. If the 
employee does not agree to a lump sum that exceeds 15 percent of 
disposable pay, the debt must be collected in installment deductions at 
officially established pay intervals in the amount established under:
    (1) A voluntary repayment agreement;
    (2) An involuntary repayment schedule where no hearing is requested; 
or
    (3) The schedule established under the written hearing decision.
    (b) Installment deductions must be made over a period not greater 
than the anticipated period of employment, except as provided under 
paragraph (d) of this section. If possible, the installment payment must 
be sufficient in size and frequency to liquidate the debt in, at most, 
three years. Installment payments of less than $25 may be accepted only 
in the most unusual circumstances.
    (c) Deductions must begin:
    (1) After the employee has entered a voluntary repayment schedule;
    (2) If a waiver is requested under Sec. 32.4(b), after the employee 
has been denied a waiver by the Secretary; or
    (3) If a hearing is requested under Sec. 32.5, after a written 
decision.
    (d) If the employee retires or resigns or his or her employment ends 
before collection of the debt is completed, the amount necessary to 
liquidate the debt must be offset from subsequent payments of any nature 
(for example, final salary payment and/or lump sum annual leave payment) 
due the employee on the date of separation. If the debt cannot be 
liquidated by offset from any such final payment due the employee on the 
date of separation, the debt must be liquidated by administrative offset 
pursuant to 31 U.S.C. 3716 from later payments of any kind due the 
employee, where appropriate. After the Secretary has complied with the 
procedures in this part, the Secretary may refer the debt to a paying 
agency for collection by offset under 5 CFR 550.1108.
    (e) Interest, penalties and administrative costs on debts collected 
under this part must be assessed, in accordance with the provisions of 4 
CFR 102.13.
    (f) An employee's payment, whether voluntary or involuntary, of all 
or any portion of an alleged debt collected pursuant to this part may 
not be construed as a waiver of any rights which the employee may have 
under this part or any other provision of law, except as otherwise 
provided by law.
    (g) Amounts paid or deducted pursuant to this part by an employee 
for a debt that is waived or otherwise found not owing to the United 
States or which the Secretary is ordered to refund must be promptly 
refunded to the employee.

(Authority: 5 U.S.C. 5514; 31 U.S.C. 3716)



PART 33_PROGRAM FRAUD CIVIL REMEDIES ACT--Table of Contents



Sec.
33.1  Basis and purpose.
33.2  Definitions.
33.3  Basis for civil penalties and assessments.
33.4  Investigation.
33.5  Review by the reviewing official.
33.6  Prerequisites for issuing a complaint.
33.7  Complaint.
33.8  Service of complaint.
33.9  Answer.
33.10  Default upon failure to file an answer.
33.11  Referral of complaint and answer to the ALJ.
33.12  Notice of hearing.
33.13  Parties to the hearing.
33.14  Separation of functions.
33.15  Ex parte contacts.

[[Page 73]]

33.16  Disqualification of reviewing official or ALJ.
33.17  Rights of parties.
33.18  Authority of the ALJ.
33.19  Prehearing conferences.
33.20  Disclosure of documents.
33.21  Discovery.
33.22  Exchange of witness lists, statements and exhibits.
33.23  Subpoenas for attendance at hearing.
33.24  Protective order.
33.25  Fees.
33.26  Form, filing and service of papers.
33.27  Computation of time.
33.28  Motions.
33.29  Sanctions.
33.30  The hearing and burden of proof.
33.31  Determining the amount of penalties and assessments.
33.32  Location of hearing.
33.33  Witnesses.
33.34  Evidence.
33.35  The record.
33.36  Post-hearing briefs.
33.37  Initial decision.
33.38  Reconsideration of initial decision.
33.39  Appeal to Department head.
33.40  Stays ordered by the Department of Justice.
33.41  Stay pending appeal.
33.42  Judicial review.
33.43  Collection of civil penalties and assessments.
33.44  Right to administrative offset.
33.45  Deposit in Treasury of United States.
33.46  Compromise or settlement.
33.47  Limitations.

    Authority: 31 U.S.C. 3801-3812.

    Source: 53 FR 15675, May 3, 1988, unless otherwise noted.



Sec. 33.1  Basis and purpose.

    (a) Basis. This part implements the Program Fraud Civil Remedies Act 
of 1986, Pub. L. No. 99-509, 6101 through 6104, 100 Stat. 16674 (October 
21, 1986), to be codified at 31 U.S.C. 3801 through 3812. This law (31 
U.S.C. 3809) requires each Federal department head to promulgate 
regulations necessary to implement the provisions of the statute.

(Authority: 31 U.S.C. 3809)

    (b) Purpose. This part:
    (1) Establishes administrative procedures for imposing civil 
penalties and assessments against persons who make, submit, or present, 
or cause to be made, submitted, or presented, false, fictitious, or 
fraudulent claims or written statements to the Department or to its 
agents; and
    (2) Specifies the hearing and appeal rights of persons subject to 
allegations of liability for those penalties and assessments.

(Authority: 31 U.S.C. 3809)



Sec. 33.2  Definitions.

    As used in this part:
    ALJ means an Administrative Law Judge in the Department appointed 
pursuant to 5 U.S.C. 3105 or detailed to the Department pursuant to 5 
U.S.C. 3344.

(Authority: 31 U.S.C. 3801(a)(7)(A))

    Benefits, as used in the definition of ``statement,'' means anything 
of value, including but no limited to any advantage, preference, 
privilege, license, permit, favorable decision, ruling, status, or loan 
guarantee.

(Authority: 31 U.S.C. 3809)

    Claim means any request, demand, or submission:
    (a) Made to the Department for property, services, or money 
(including money representing grants, cooperative agreements, loans, 
insurance, or benefits);
    (b) Made to a recipient of property, services, or money from the 
Department or to a party to a contract or agreement with the Department:
    (1) For property or services if the United States:
    (i) Provided the property or services;
    (ii) Provided any portion of the funds for the purchase of the 
property or services; or
    (iii) Will reimburse the recipient or party for the purchase of the 
property or services; or
    (2) For the payment of money (including money representing grants, 
cooperative agreements, loans, insurance, or benefits) if the United 
States:
    (i) Provided any portion of the money requested or demanded;
    (ii) Will reimburse the recipient or party for any portion of the 
money paid on that request or demand; or
    (iii) Will guarantee or reinsure any portion of a loan made by the 
party; or
    (c) Made to the Department which has the effect of decreasing an 
obligation to pay or account for property, services, or money.

(Authority: 31 U.S.C. 3801(a)(3))


[[Page 74]]


    Complaint means the administrative complaint served by the reviewing 
official on the defendant under Sec. 33.7.

(Authority: 31 U.S.C. 3809)

    Defendant means any person alleged in a complaint under Sec. 33.7 to 
be liable for a civil penalty or assessment under Sec. 33.3.

(Authority: 31 U.S.C. 3809)

    Department means the United States Department of Education.

(Authority: 31 U.S.C. 3809)

    Department head means the Secretary or Under Secretary of the United 
States Department of Education.

(Authority: 31 U.S.C. 3801(a)(2))

    Government means the United States Government.

(Authority: 31 U.S.C. 3809)

    Individual means a natural person.

(Authority: 31 U.S.C. 3809)

    Initial decision means the written decision of the ALJ required by 
Sec. 33.10 or Sec. 33.37, and includes a revised initial decision issued 
following a remand or a motion for reconsideration.

(Authority: 31 U.S.C. 3803(h))

    Investigating official means the Inspector General of the Department 
or an officer or employee of the Office of the Inspector General 
designated by the Inspector General and serving in a position for which 
the rate of basic pay is not less than the minimum rate of basic pay for 
grade GS-16 under the General Schedule.

(Authority: 31 U.S.C. 3801(4)(A)(i))

    Knows or has reason to know, means that a person, with respect to a 
claim or statement:
    (a) Has actual knowledge that the claim or statement is false, 
fictitious, or fraudulent;
    (b) Acts in deliberate ignorance of the truth or falsity of the 
claim or statement; or
    (c) Acts in reckless disregard of the truth or falsity of the claim 
or statement.

(Authority: 31 U.S.C. 3801(5))

    Makes includes the terms presents, submits, and causes to be made, 
presented, or submitted.

(Authority: 31 U.S.C. 3802(a))

    Person means any individual, partnership, corporation, association, 
or private organization.

(Authority: 31 U.S.C. 3801(a)(6))

    Representative means:
    (a) An attorney who is a member in good standing of the bar of any 
State, territory, possession of the United States, the District of 
Columbia, or the Commonwealth of Puerto Rico; or
    (b) Any other person designated by a party in writing, provided that 
the designation includes a certification that the party understands the 
nature and consequences of an administrative enforcement action under 
this part, and that he or she has the right to representation by counsel 
or to self-representation.

(Authority: 31 U.S.C. 3803(g)(2)(F))

    Reviewing official means the General Counsel of the Department or 
his or her designee who is:
    (a) Not subject to supervision by, or required to report to, the 
investigating official; and
    (b) Not employed in the organizational unit of the Department in 
which the investigating official is employed; and
    (c) Serving in a position for which the rate of basic pay is not 
less than the minimum rate of basic pay for grade GS-16 under the 
General Schedule.

(Authority: 31 U.S.C. 3801(8))

    Statement means any representation, certification, affirmation, 
document, record, or accounting or bookkeeping entry made:
    (a) With respect to a claim or to obtain the approval or payment of 
a claim (including relating to eligibility to make a claim); or
    (b) With respect to (including relating to eligibility for):
    (1) A contract with, or a bid or proposal for a contract with; or
    (2) A grant, cooperative agreement, loan, or benefit from;

The Department, or any State, political subdivision of a State, or other

[[Page 75]]

party, if the United States Government provides any portion of the money 
or property under the contract or for the grant, loan, cooperative 
agreement, or benefit, or if the Government will reimburse or reinsure 
the State, political subdivision, or party for any portion of the money 
or property under the contract or for the grant, cooperative agreement, 
loan, or benefit.

(Authority: 31 U.S.C. 3801(9))



Sec. 33.3  Basis for civil penalties and assessments.

    (a) Claims. (1) Any person who makes a claim that the person knows 
or has reason to know:
    (i) Is false, fictitious, or fraudulent;
    (ii) Includes or is supported by any written statement which asserts 
a material fact which is false, fictitious, or fraudulent;
    (iii) Includes or is supported by any written statement that:
    (A) Omits a material fact;
    (B) Is false, fictitious, or fraudulent as a result of such 
omission; and
    (C) Is a statement in which the person making such statement has a 
duty to include such material fact; or
    (iv) Is for payment for the provision of property or services which 
the person has not provided as claimed;

shall be subject, in addition to any other remedy that may be prescribed 
by law, to a civil penalty of not more than $5,000 for each claim.
    (2) Each voucher, invoice, claim form, or other individual request 
or demand for property, services, or money constitutes a separate claim.
    (3) A claim is considered made to the Department, a recipient, or 
party when that claim is actually made to an agent, fiscal intermediary, 
or other entity, including any State or political subdivision thereof, 
acting for or on behalf of the Department, a recipient, or party.
    (4) Each claim for property, services, or money is subject to a 
civil penalty regardless of whether the property, services, or money is 
actually delivered or paid.
    (5) If the Government has made any payment (including transferred 
property or provided services) on a claim, a person subject to a civil 
penalty under paragraph (a)(1) of this section is also subject to an 
assessment of not more than twice the amount of that claim or that 
portion thereof that is determined to be in violation of paragraph 
(a)(1) of this section. The assessment is in lieu of damages sustained 
by the Government because of that claim.

(Authority: 31 U.S.C. 3802(a)(1))

    (b) Statements. (1) Any person who makes a written statement that:
    (i) The person knows or has reason to know:
    (A) Asserts a material fact which is false, fictitious, or 
fraudulent; or
    (B) Is false, fictitious, or fraudulent because it omits a material 
fact that the person making the statement has a duty to include in the 
statement; and
    (ii) Contains or is accompanied by an express certification or 
affirmation of the truthfulness and accuracy of the contents of the 
statement;

shall be subject, in addition to any other remedy that may be prescribed 
by law, to a civil penalty of not more than $5,000 for each statement.
    (2) Each written representation, certification, or affirmation 
constitutes a separate statement.
    (3) A statement is considered made to the Department when the 
statement is actually made to an agent, fiscal intermediary, or other 
entity, including any State or political subdivision thereof, acting for 
or on behalf of the Department.

(Authority: 31 U.S.C. 3802(a)(2))

    (c) No proof of specific intent to defraud is required to establish 
liability under this section.

(Authority: 31 U.S.C. 3801(5))

    (d) In any case in which it is determined that more than one person 
is liable for making a claim or statement under this section, each of 
those persons may be held liable for a civil penalty under this section.

(Authority: 31 U.S.C. 3802(a))

    (e) In any case in which it is determined that more than one person 
is liable for making a claim under this section of which the Government 
has made payment (including transferred property or provided services), 
an assessment may be imposed against any

[[Page 76]]

of those persons or jointly and severally against any combination of 
those persons.

(Authority: 31 U.S.C. 3802(a)(1); 3809)



Sec. 33.4  Investigation.

    (a) If an investigating official concludes that a subpoena pursuant 
to the authority conferred by 31 U.S.C. 3604(a) is warranted:
    (1) The subpoena so issued must notify the person to whom it is 
addressed of the authority under which the subpoena is issued and must 
identify the records or documents sought;
    (2) The investigating official may designate a person to act on his 
or her behalf to receive the documents sought; and
    (3) The person receiving the subpoena is required to tender to the 
investigating official or the person designated to receive the documents 
a certification that the documents sought have been produced, or that 
the documents are not available and the reasons therefore, or that the 
documents, suitably identified, have been withheld based upon the 
assertion of an identified privilege.

(Authority: 31 U.S.C. 3804(a))

    (b) If the investigating official concludes that an action under the 
Program Fraud Civil Remedies Act may be warranted, the investigating 
official shall submit a report containing the findings and conclusions 
of the investigation to the reviewing official.

(Authority: 31 U.S.C. 3803(a)(1))

    (c) Nothing in this section precludes or limits an investigating 
official's discretion to refer allegations directly to the Department of 
Justice for suit under the False Claims Act or other civil relief, or to 
defer or postpone a report or referral to the reviewing official to 
avoid interference with a criminal investigation or prosecution.

(Authority: 31 U.S.C. 3809)

    (d) Nothing in this section modifies any responsibility of an 
investigating official to report violations of criminal law to the 
Attorney General.

(Authority: 31 U.S.C. 3803(a)(1))



Sec. 33.5  Review by the reviewing official.

    (a) If, based on the report of the investigating official under 
Sec. 33.4(b), the reviewing official determines that there is adequate 
evidence to believe that a person is liable under Sec. 33.3 of this 
part, the reviewing official transmits to the Attorney General a written 
notice of the reviewing official's intention to issue a complaint under 
Sec. 33.7.
    (b) The notice must include--
    (1) A statement of the reviewing official's reasons for issuing a 
complaint;
    (2) A statement specifying the evidence that supports the 
allegations of liability;
    (3) A description of the claims or statements upon which the 
allegations of liability are based;
    (4) An estimate of the amount of money or the value of property, 
services, or other benefits requested or demanded in violation of 
Sec. 33.3;
    (5) A statement of any exculpatory or mitigating circumstances that 
may relate to the claims or statements known by the reviewing official 
or the investigating official; and
    (6) A statement that there is a reasonable prospect of collecting an 
appropriate amount of penalties and assessments. Such a statement may be 
based upon information then known or an absence of any information 
indicating that the person may be unable to pay such an amount.

(Authority: 31 U.S.C. 3803(a)(2); 3809(2))



Sec. 33.6  Prerequisites for issuing a complaint.

    (a) The reviewing official may issue a complaint under Sec. 33.7 
only if--
    (1) The Department of Justice approves the issuance of a complaint 
in a written statement described in 31 U.S.C. 3803(b)(1); and
    (2) In the case of allegations of liability under Sec. 33.3(a) with 
respect to a claim, the reviewing official determines that, with respect 
to that claim or a group of related claims submitted at the same time 
the claim is submitted (as defined in paragraph (b) of this section), 
the amount of money or the value of property or services demanded or 
requested in violation of Sec. 33.3(a) does not exceed $150,000.

[[Page 77]]

    (b) For the purposes of this section, a related group of claims 
submitted at the same time includes only those claims arising from the 
same transaction (e.g., grant, cooperative agreement, loan, application, 
or contract) that are submitted simultaneously as part of a single 
request, demand, or submission.
    (c) Nothing in this section may be construed to limit the reviewing 
official's authority to join in a single complaint against a person 
claims that are unrelated or were not submitted simultaneously, 
regardless of the amount of money, or the value of property or services, 
demanded or requested.

(Authority: 31 U.S.C. 3803(b), (c))



Sec. 33.7  Complaint.

    (a) On or after the date the Department of Justice approves the 
issuance of a complaint in accordance with 31 U.S.C. 3803(b)(1), the 
reviewing official may serve a complaint on the defendant, as provided 
in Sec. 33.8.
    (b) The complaint must state:
    (1) The allegations of liability against the defendant, including 
the statutory basis for liability, an identification of the claims or 
statements that are the basis for the alleged liability, and the reasons 
why liability allegedly arises from those claims or statements;
    (2) The maximum amount of penalties and assessments for which the 
defendant may be held liable;
    (3) Instructions for filing an answer to request a hearing, 
including a specific statement of the defendant's right to request a 
hearing by filing an answer and to be represented by a representative; 
and
    (4) That failure to file an answer within 30 days of service of the 
complaint will result in the imposition of the maximum amount of 
penalties and assessments without right to appeal, as provided in 
Sec. 33.10.
    (c) At the same time the reviewing official serves the complaint, he 
or she shall serve the defendant with a copy of the regulations in this 
part.

(Authority: 31 U.S.C. 3803(a))



Sec. 33.8  Service of complaint.

    (a) Service of a complaint must be made by certified or registered 
mail or by delivery in any manner authorized by Rule 4(d) of the Federal 
Rules of Civil Procedure. Service is complete upon receipt.
    (b) Proof of service, stating the name and address of the person on 
whom the complaint was served, and the manner and date of service, may 
be made by:
    (1) Affidavit of the individual serving the complaint by delivery;
    (2) An acknowledged United States Postal Service return receipt 
card; or
    (3) Written acknowledgment of receipt by the defendant or his 
representative.

(Authority: 31 U.S.C. 3802(d))



Sec. 33.9  Answer.

    (a) The defendant may request a hearing by filing an answer with the 
reviewing official within 30 days of service of the complaint. An answer 
is deemed to be a request for hearing.
    (b) In the answer, the defendant:
    (1) Shall admit or deny each of the allegations of liability made in 
the complaint;
    (2) Shall state any defense on which the defendant intends to rely;
    (3) May state any reasons why the defendant contends that the 
penalties and assessments should be less than the statutory maximum; and
    (4) Shall state the name, address, and telephone number of the 
person authorized by the defendant to act as defendant's representative, 
if any.
    (c) If the defendant is unable to file an answer meeting the 
requirements of paragraph (b) of this section within the time provided, 
the defendant may, before the expiration of 30 days from service of the 
complaint, file with the reviewing official a general answer denying 
liability and requesting a hearing, and a request for an extension of 
time within which to file an answer meeting the requirements of 
paragraph (b) of this section. The reviewing official shall file 
promptly with the ALJ the complaint, the general answer denying 
liability, and the request for an extension of time as provided in 
Sec. 33.11 for good cause shown, the ALJ may grant the defendant up to 
30 additional

[[Page 78]]

days within which to file an answer meeting the requirements of 
paragraph (b) of this section.

(Authority: 31 U.S.C. 3803(d)(2), 3809)



Sec. 33.10  Default upon failure to file an answer.

    (a) If the defendant does not file an answer within the time 
prescribed in Sec. 33.9(a), the reviewing official may refer the 
complaint to the ALJ.
    (b) Upon the referral of the complaint, the ALJ shall promptly serve 
on defendant in the manner prescribed in Sec. 33.8, a notice that an 
initial decision will be issued under this section.
    (c) The ALJ shall assume the facts alleged in the complaint to be 
true and, if those facts establish liability under Sec. 33.3, the ALJ 
shall issue an initial decision imposing the maximum amount of penalties 
and assessments allowed under the statute.
    (d) Except as otherwise provided in this section, by failing to file 
a timely answer the defendant waives any right to further review of the 
penalties and assessments imposed under paragraph (c) of this section, 
and the initial decision becomes final and binding upon the parties 30 
days after it is issued.
    (e) If, before such an initial decision becomes final, the defendant 
files a motion with the ALJ seeking to reopen on the grounds that 
extraordinary circumstances prevented the defendant from filing an 
answer, the initial decision must be stayed pending the ALJ's decision 
on the motion.
    (f) If, on such a motion, the defendant can demonstrate 
extraordinary circumstances excusing the failure to file a timely 
answer, the ALJ shall withdraw the initial decision under paragraph (c) 
of this section, if such a decision has been issued, and shall grant the 
defendant an opportunity to answer the complaint.
    (g) A decision of the ALJ denying a defendant's motion under 
paragraph (e) of this section is not subject to reconsideration under 
Sec. 33.38.
    (h) The defendant may appeal to the Department head the decision 
denying a motion to reopen by filing a notice of appeal with the 
Department head within 15 days after the ALJ denies the motion. The 
timely filing of a notice of appeal stays the initial decision until the 
Department head decides the issue.
    (i) If the defendant files a timely notice of appeal with the 
Department head, the ALJ shall forward the record of the proceeding to 
the Department head.
    (j) The Department head decides expeditiously whether extraordinary 
circumstances excuse the defendant's failure to file a timely answer 
based solely on the record before the ALJ.
    (k) If the Department head decides that extraordinary circumstances 
excuse the defendant's failure to file a timely answer, the Department 
head remands the case to the ALJ with instructions to grant the 
defendant an opportunity to answer.
    (l) If the Department head decides that the defendant's failure to 
file a timely answer is not excused, the Department head reinstates the 
initial decision of the ALJ, which becomes final and binding upon the 
parties 30 days after the Department head issues that decision.

(Authority: 31 U.S.C. 3809)



Sec. 33.11  Referral of complaint and answer to the ALJ.

    Upon receipt of an answer, the reviewing official shall file the 
complaint and answer with the ALJ.

(Authority: 31 U.S.C. 3803(d)(2); 3809)



Sec. 33.12  Notice of hearing.

    (a) When the ALJ receives the complaint and answer, the ALJ shall 
promptly serve a notice of hearing upon the defendant in the manner 
prescribed by Sec. 33.8. At the same time, the ALJ shall send a copy of 
the notice to the representative for the Government.
    (b) The notice must include:
    (1) The tentative time and place, and the nature of the hearing;
    (2) The legal authority and jurisdiction under which the hearing is 
to be held;
    (3) The matters of fact and law to be asserted;
    (4) A description of the procedures for the conduct of the hearing;
    (5) The name, address, and telephone number of the representative of 
the Government and of the defendant, if any; and

[[Page 79]]

    (6) Such other matters as the ALJ deems appropriate.

(Authority: 31 U.S.C. 3803(g)(2)(A))



Sec. 33.13  Parties to the hearing.

    (a) The parties to the hearing are the defendant and the Department.
    (b) Pursuant to 31 U.S.C. 3730(c)(5), a private plaintiff under the 
False Claims Act may participate in these proceedings to the extent 
authorized by the provisions of that Act.

(Authority: 31 U.S.C. 3803(g)(2))



Sec. 33.14  Separation of functions.

    (a) The investigating official, the reviewing official, and any 
employee or agent of the Department who takes part in investigating, 
preparing, or presenting a particular case may not, in that case or a 
factually related case:
    (1) Participate in the hearing as the ALJ;
    (2) Participate or advise in the initial decision or the review of 
the initial decision by the Department head, except as a witness or a 
representative in public proceedings; or
    (3) Make the collection of penalties and assessments under 31 U.S.C. 
3806.
    (b) The ALJ may not be responsible to, or subject to the supervision 
or direction of, the investigating official or the reviewing official.
    (c) Except as provided in paragraph (a) of this section, the 
representative for the Government may be employed anywhere in the 
Department, including in the offices of either the investigating 
official or the reviewing official.

(Authority: 31 U.S.C. 3809(l)(2))



Sec. 33.15  Ex parte contacts.

    No party or person (except employees of the ALJ's office) may 
communicate in any way with the ALJ on any matter at issue in a case, 
unless on notice and opportunity for all parties to participate. This 
provision does not prohibit a person or party from inquiring about the 
status of a case or asking routine questions concerning administrative 
functions or procedures.

(Authority: 31 U.S.C. 3803(g)(1)(A))



Sec. 33.16  Disqualification of reviewing official or ALJ.

    (a) A reviewing official or ALJ in a particular case may disqualify 
himself or herself at any time.
    (b) A party may file with the ALJ a motion for disqualification of a 
reviewing official or an ALJ. That motion must be accompanied by an 
affidavit alleging personal bias or other reason for disqualification.
    (c) The motion and affidavit must be filed promptly upon the party's 
discovery of reasons requiring disqualification, or the objections are 
deemed waived.
    (d) The affidavit must state specific facts that support the party's 
belief that personal bias or other reason for disqualification exists 
and the time and circumstances of the party's discovery of those facts. 
It must be accompanied by a certificate of the representative of record 
that it is made in good faith.
    (e) Upon the filing of the motion and affidavit, the ALJ shall not 
proceed further in the case until he or she resolves the matter of 
disqualification in accordance with paragraph (f) of this section.
    (f)(1) If the ALJ determines that a reviewing official is 
disqualified, the ALJ shall dismiss the complaint without prejudice.
    (2) If the ALJ disqualifies himself or herself, the case must be 
reassigned promptly to another ALJ.
    (3) If the ALJ denies a motion to disqualify, the Department head 
may determine the matter only as part of his or her review of the 
initial decision upon appeal, if any.

(Authority: 31 U.S.C. 3803(g)(2)(G))



Sec. 33.17  Rights of parties.

    Except as otherwise limited by this part, all parties may:
    (a) Be accompanied, represented, and advised by a representative (as 
defined in Sec. 33.2);
    (b) Participate in any conference held by the ALJ:
    (c) Conduct discovery under Sec. 33.21;
    (d) Agree to stipulations of fact or law, which must be made part of 
the record;

[[Page 80]]

    (e) Present evidence relevant to the issues at the hearing;
    (f) Present and cross-examine witnesses;
    (g) Present oral arguments at the hearing as permitted by the ALJ; 
and
    (h) Submit written briefs and proposed findings of fact and 
conclusions of law after the hearing.

(Authority: 31 U.S.C. 3803(g) (2) (E), (F), (3)(B)(ii))



Sec. 33.18  Authority of the ALJ.

    (a) The ALJ shall conduct a fair and impartial hearing, avoid delay, 
maintain order, and assure that a record of the proceeding is made.
    (b) The ALJ has the authority to:
    (1) Set and change the date, time, and place of the hearing upon 
reasonable notice to the parties;
    (2) Disqualify a non-attorney representative (designated as 
described in the Sec. 33.2 definitions of ``representative'') if the ALJ 
determines that the representative is incapable of rendering reasonably 
effective assistance;
    (3) Continue or recess the hearing in whole or in part for a 
reasonable period of time;
    (4) Hold conferences to identify or simplify the issues, or to 
consider other matters that may aid in the expeditious disposition of 
the proceeding;
    (5) Administer oaths and affirmations;
    (6) Issue subpoenas requiring the attendance of witnesses and the 
production of documents at depositions or at hearings;
    (7) Rule on motions and other procedural matters;
    (8) Regulate the scope and timing of discovery;
    (9) Regulate the course of the hearing and the conduct of 
representatives and parties;
    (10) Examine witnesses;
    (11) Receive, rule on, exclude, or limit evidence;
    (12) Upon motion of a party, take official notice of facts;
    (13) Upon motion of a party, decide cases, in whole or in part, by 
summary judgment if there is no disputed issue of material fact;
    (14) Conduct any conference, argument, or hearing on motions in 
person or by telephone; and
    (15) Exercise such other authority as is necessary to carry out the 
responsibilities of the ALJ under this part.
    (c) The ALJ does not have the authority to find Federal statutes or 
regulations invalid.

(Authority: 31 U.S.C. 3803(g))



Sec. 33.19  Prehearing conferences.

    (a) The ALJ may schedule perhearing conferences as appropriate.
    (b) Upon the motion of any party, the ALJ shall schedule at least 
one perhearing conference at a reasonable time in advance of the 
hearing.
    (c) The ALJ may use prehearing conferences to discuss the following:
    (1) Simplification of the issues.
    (2) The necessity or desirability of amendments to the pleadings, 
including the need for a more definite statement.
    (3) Stipulations, admissions of fact or as to the contents and 
authenticity of documents.
    (4) Whether the parties can agree to submission of the case on a 
stipulated record.
    (5) Whether a party chooses to waive appearance at an oral hearing 
and to submit only documentary evidence (subject to the objection of 
other parties) and written argument.
    (6) Limitation of the number of witnesses.
    (7) Scheduling dates for the exchange of witness lists and of 
proposed exhibits.
    (8) Discovery.
    (9) The time and place for the hearing.
    (10) Such other matters as may tend to expedite the fair and just 
disposition of the proceedings.
    (d) The ALJ may issue an order containing all matters agreed upon by 
the parties or ordered by the ALJ at a prehearing conference.

(Authority: 31 U.S.C. 3803(g))



Sec. 33.20  Disclosure of documents.

    (a) Upon written request to the reviewing official, the defendant 
may review any relevant and material documents, transcripts, records, 
and other materials that relate to the allegations set out in the 
complaint and upon which the findings and conclusions of

[[Page 81]]

the investigating official under Sec. 33.4(b) are based, unless those 
documents are subject to a privilege under Federal law. Upon payment of 
fees for duplication, the defendant may obtain copies of the documents.
    (b) Upon written request to the reviewing official, the defendant 
also may obtain a copy of all exculpatory information in the possession 
of the reviewing official or investigating official relating to the 
allegations in the complaint, even if it is contained in a document that 
would otherwise be privileged. If the document would otherwise be 
privileged, only that portion containing exculpatory information must be 
disclosed.
    (c) The notice sent to the Attorney General from the reviewing 
official as described in Sec. 33.5 is not discoverable under any 
circumstances.
    (d) The defendant may file a motion to compel disclosure of the 
documents subject to the provisions of this section. Such a motion may 
only be filed with the ALJ following the filing of an answer pursuant to 
Sec. 33.9.

(Authority: 31 U.S.C. 3803(g)(3)(B)(ii), 3803(e))



Sec. 33.21  Discovery.

    (a) The following types of discovery are authorized:
    (1) Requests for production of documents for inspection and copying.
    (2) Requests for admissions of the authenticity of any relevant 
document or of the truth of any relevant fact.
    (3) Written interrogatories.
    (4) Depositions.
    (b) For the purpose of this section and Secs. 33.22 and 33.23, the 
term ``documents'' includes information, documents, reports, answers, 
records, accounts, papers, and other data and documentary evidence. 
Nothing contained in this part may be interpreted to require the 
creation of a document.
    (c) Unless mutually agreed to by the parties, discovery is available 
only as ordered by the ALJ. The ALJ shall regulate the timing of 
discovery.
    (d) Motions for discovery. (1) A party seeking discovery may file a 
motion with the ALJ. Such a motion shall be accompanied by a copy of the 
requested discovery, or in the case of depositions, a summary of the 
scope of the proposed deposition.
    (2) Within ten days of service, a party may file an opposition to 
the motion or a motion for protective order, or both, as provided in 
Sec. 33.24.
    (3) The ALJ may grant a motion for discovery only if he finds that 
the discovery sought:
    (i) Is necessary for the expeditious, fair, and reasonable 
determination of the issues;
    (ii) Is not unduly costly or burdensome;
    (iii) Will not unduly delay the proceeding; and
    (iv) Does not seek privileged information.
    (4) The burden of showing that discovery should be allowed is on the 
party seeking discovery.
    (5) The ALJ may grant discovery subject to a protective order under 
Sec. 33.24.

(Authority: 31 U.S.C. 3803(a)(3)(B)(ii))

    (e) Depositions. (1) If a motion for deposition is granted, the ALJ 
shall issue a subpoena for the deponent, which may require the deponent 
to produce documents. The subpoena must specify the time and place at 
which the deposition will be held.
    (2) The party seeking to depose shall serve the subpoena in the 
manner prescribed in Sec. 33.8.
    (3) The deponent may file with the ALJ a motion to quash the 
subpoena or a motion for a protective order within ten days of service.
    (4) The party seeking to depose shall provide for the taking a 
verbatim transcript of the deposition, which the party shall make 
available to all other parties for inspection and copying.
    (f) Each party shall bear its own costs of discovery.

(Authority: 31 U.S.C. 3803(g)(3)(B)(ii))



Sec. 33.22  Exchange of witness lists, statements and exhibits.

    (a) At least 15 days before the hearing or at such other time as may 
be ordered by the ALJ, the parties shall exchange witness lists, copies 
of prior statements of proposed witnesses, and copies of proposed 
hearing exhibits, including copies of any written statements that the 
party intends to offer in lieu of live testimony in accordance with 
Sec. 33.33(b). At the time these documents are exchanged, any party that 
is

[[Page 82]]

permitted by the ALJ to rely on the transcript of deposition testimony 
in lieu of live testimony at the hearing, shall provide each other party 
with a copy of the specific pages of the transcript it intends to 
introduce.
    (b) If a party objects, the ALJ shall not admit into evidence the 
testimony of any witness whose name does not appear on the witness list 
or any exhibit not provided to the opposing party as provided in 
paragraph (a) of this Section unless the ALJ finds good cause for the 
failure or that there is no prejudice to the objecting party.
    (c) Unless another party objects within the time set by the ALJ, 
documents exchanged in accordance with paragraph (a) of this section are 
deemed to be authentic for the purpose of admissibility at the hearing.

(Authority: 31 U.S.C. 3803(g)(2))



Sec. 33.23  Subpoenas for attendance at hearing.

    (a) A party wishing to procure the appearance and testimony of any 
individual at the hearing may request that the ALJ issue a subpoena.
    (b) A subpoena requiring the attendance and testimony of an 
individual may also require the individual to produce documents at the 
hearing.
    (c) A party seeking a subpoena shall file a written request therefor 
not less than 15 days before the date fixed for the hearing unless 
otherwise allowed by the ALJ for good cause shown. The request must 
specify any documents to be produced and must designate the witnesses 
and describe their address and location with sufficient particularity to 
permit the witnesses to be found.
    (d) The subpoena must specify the time and place at which a witness 
is to appear and any documents the witness is to produce.
    (e) The party seeking the subpoena shall serve it in the manner 
prescribed in Sec. 33.8. A subpoena on a party or upon an individual 
under the control of a party may be served by first class mail.
    (f) A party or the individual to whom the subpoena is directed may 
file with the ALJ a motion to quash the subpoena within ten days after 
service or on or before the time specified in the subpoena for 
compliance if is is less then ten days after service.

(Authority: 31 U.S.C. 3804(b))



Sec. 33.24  Protective order.

    (a) A party or a prospective witness or deponent may file a motion 
for a protective order with respect to discovery sought by an opposing 
party or with respect to the hearing, seeking to limit the availability 
or disclosure of evidence.
    (b) In issuing a protective order, the ALJ may take any order which 
justice requires to protect a party or person from annoyance, 
embarrassment, oppression, or undue burden or expense, including one or 
more of the following:
    (1) That the discovery not be had.
    (2) That the discovery may be had only on specified terms and 
conditions, including a designation of the time or place.
    (3) That the discovery may be had only through a method of discovery 
other than that requested.
    (4) That certain matters not be inquired into, or that the scope of 
discovery be limited to certain matters.
    (5) That the discovery be conducted with no one present except 
persons designated by the ALJ.
    (6) That the contents of discovery or evidence be sealed.
    (7) That a deposition after being sealed be opened only by order of 
the ALJ.
    (8) That a trade secret or other confidential research, development, 
commercial information, or facts pertaining to any criminal 
investigation, proceeding, or other administrative investigation not be 
disclosed or be disclosed only in a designated way.
    (9) That the parties simultaneously file specified documents or 
information enclosed in sealed envelopes to be opened as directed by the 
ALJ.

(Authority: 31 U.S.C. 3803(g)(3)(B)(ii))



Sec. 33.25  Fees.

    The party requesting a subpoena shall pay the cost of the fees and 
mileage of any witness subpoenaed in the amounts that would be payable 
to a witness in a proceeding in United States District Court. A check 
for witness fees and mileage must accompany

[[Page 83]]

the subpoena when served, except that if a subpoena is issued on behalf 
of the authority, a check for witness fees and mileage need not 
accompany the subpoena.

(Authority: 31 U.S.C. 3804(b))



Sec. 33.26  Form, filing and service of papers.

    (a) Form. (1) Documents filed with the ALJ must include an original 
and two copies.
    (2) Every pleading and paper filed in the proceeding must contain a 
caption setting for the title of the action, the case number assigned by 
the ALJ, and a designation of the paper (e.g., motion to quash 
subpoena).
    (3) Every pleading and paper must be signed by, and must contain the 
address and telephone number of the party or the person on whose behalf 
the paper was filed, or his or her representative.
    (4) Papers are considered filed when they are mailed. Date of 
mailing may be established by a certificate from the party or its 
representative or by proof that the document was sent by certified or 
registered mail.
    (b) Service. A party filing a document with the ALJ shall, at the 
time of filing, serve a copy of the document on every other party. 
Service upon any party of any document other than those required to be 
served as prescribed in Sec. 33.8 shall be made by delivering a copy, or 
by placing a copy of the document in the United States mail, postage 
prepaid and addressed, to the party's last known address. If a party is 
represented by a representative, service must be made upon the 
representative in lieu of the actual party.
    (c) Proof of service. A certificate of the individual serving the 
document by personal delivery or by mail, setting forth the manner of 
service, is proof of service.

(Authority: 31 U.S.C. 3803(b)(3)(A))



Sec. 33.27  Computation of time.

    (a) In computing any period of time under this part or in an order 
issued under this part, the time begins with the day following the act, 
event, or default, and includes the last day of the period, unless it is 
a Saturday, Sunday, or legal holiday observed by the Federal Government, 
in which event it includes the next business day.
    (b) If the period of time allowed is less than seven days, 
intermediate Saturdays, Sundays, and legal holidays observed by the 
Federal Government are excluded from the computation.
    (c) If a document has been served or issued by placing it in the 
mail, an additional five days is added to the time permitted for any 
response.

(Authority: 31 U.S.C. 3809)



Sec. 33.28  Motions.

    (a) Any application to the ALJ for an order or ruling must be by 
motion. Motions must state the relief sought, the authority relied upon, 
and the facts alleged, and must be filed with the ALJ and served on all 
other parties.
    (b) Except for motions made during a prehearing conference or at the 
hearing, all motions must be in writing. The ALJ may require that oral 
motions be reduced to writing.
    (c) Within 15 days after a written motion is served, or such other 
time as may be fixed by the ALJ, any party may file a response to the 
motion.
    (d) The ALJ may not grant a written motion before the time for 
filing responses to the motion has expired, except upon consent of the 
parties or following a hearing on the motion, but may overrule or deny 
the motion without awaiting a response.
    (e) The ALJ shall make a reasonable effort to dispose of all 
outstanding motions prior to the beginning of the hearing.

(Authority: 31 U.S.C. 3803(g)(3)(A))



Sec. 33.29  Sanctions.

    (a) The ALJ may sanction a person, including any party or 
representative for--
    (1) Failing to comply with an order, rule, or procedure governing 
the proceeding;
    (2) Failing to prosecute or defend an action; or
    (3) Engaging in other misconduct that interferes with the speedy, 
orderly, or fair conduct of the hearing.
    (b) Any sanction, including but not limited to those listed in 
paragraphs

[[Page 84]]

(c), (d), and (e) of this section must reasonably relate to the severity 
and nature of the failure or misconduct.
    (c) If a party fails to comply with an order, including an order for 
taking a deposition, the production of evidence within the party's 
control, or a request for admission, the ALJ may--
    (1) Draw an inference in favor of the requesting party with regard 
to the information sought;
    (2) In the case of requests for admission, deem each matter of which 
an admission is requested to be admitted;
    (3) Prohibit the party failing to comply with the order from 
introducing evidence concerning, or otherwise relying upon testimony 
relating to, the information sought; and
    (4) Strike any part of the pleadings or other submissions of the 
party failing to comply with the request.
    (d) If a party fails to prosecute or defend an action under this 
part commenced by service of a notice of hearing, the ALJ may dismiss 
the action or may issue an initial decision imposing penalties and 
assessments.
    (e) The ALJ may refuse to consider any motion, request, response, 
brief, or other document that is not filed in a timely fashion.

(Authority: 31 U.S.C. 3803(g)(2))



Sec. 33.30  The hearing and burden of proof.

    (a) The ALJ shall conduct a hearing on the record in order to 
determine whether the defendant is liable for a civil penalty or 
assessment under Sec. 33.3 and, if so, the appropriate amount of the 
civil penalty or assessment considering any aggravating or mitigating 
factors.
    (b) The Department shall prove a defendant's liability and any 
aggravating factors by a preponderance of the evidence.
    (c) The defendant shall prove any affirmative defenses and any 
mitigating factors by a preponderance of the evidence.
    (d) The hearing must be open to the public unless otherwise ordered 
by the ALJ for good cause shown.

(Authority: 31 U.S.C. 3803 (f), (g)(2))



Sec. 33.31  Determining the amount of penalties and assessments.

    (a) In determining an appropriate amount of civil penalties and 
assessments, the ALJ and the Department head, upon appeal, evaluate any 
circumstances that mitigate or aggravate the violation and articulate in 
their opinions the reasons that support the penalties and assessments 
they impose. Because of the intangible costs of fraud, the expense of 
investigating fraudulent conduct, and the need to deter others who might 
be similarly tempted, ordinarily double damages and a significant civil 
penalty is imposed.
    (b) Although not exhaustive, the following factors are among those 
that may influence the ALJ and the Department head in determining the 
amount of penalties and assessments to impose with respect to the 
misconduct (i.e., the false, fictitious, or fraudulent claims or 
statements) charged in the complaint:
    (1) The number of false, fictitious, or fraudulent claims or 
statements.
    (2) The time period over which such claims or statements were made.
    (3) The degree of the defendent's culpability with respect to the 
misconduct.
    (4) The amount of money or the value of the property, services, or 
benefit falsely claimed.
    (5) The value of the Government's actual loss as a result of the 
misconduct, including foreseeable consequential damages and the costs of 
investigation.
    (6) The relationship of the amount imposed as civil penalties to the 
amount of the Government's loss.
    (7) The potential or actual impact of the misconduct upon national 
defense, public health or safety, or public confidence in the management 
of Government programs and operations, including particularly the impact 
on the intended beneficiaries of such programs.
    (8) Whether the defendant has engaged in a pattern of the same or 
similar misconduct.
    (9) Whether the defendant attempted to conceal the misconduct.
    (10) The degree to which the defendant has involved others in the 
misconduct or in concealing it.

[[Page 85]]

    (11) If the misconduct of employees or agents is imputed to the 
defendant, the extent to which the defendant's practices fostered or 
attempted to preclude the misconduct.
    (12) Whether the defendant cooperated in or obstructed an 
investigation of the misconduct.
    (13) Whether the defendant assisted in identifying and prosecuting 
other wrongdoers.
    (14) The complexity of the program or transaction, and the degree of 
the defendant's sophistication with respect to it, including the extent 
of the defendant's prior participation in the program or in similar 
transactions.
    (15) Whether the defendant has been found, in any criminal, civil, 
or administrative proceeding to have engaged in similar misconduct or to 
have dealt dishonestly with the Government of the United States or of a 
State, directly or indirectly.
    (16) The need to deter the defendant and others from engaging in the 
same or similar misconduct.
    (c) Nothing in this section may be construed to limit the ALJ or the 
Department head from considering any other factors that in any given 
case may mitigate or aggravate the offense for which penalties and 
assessments are imposed.

(Authority: 31 U.S.C. 3803(a)(2) (e), (f))



Sec. 33.32  Location of hearing.

    (a) The hearing may be held:
    (1) In any judicial district of the United States in which the 
defendant resides or transacts business;
    (2) In any judicial district of the United States in which the claim 
or statement in issue was made; or
    (3) In such other place as may be agreed upon by the defendant and 
the ALJ.
    (b) Each party must have the opportunity to present argument with 
respect to the location of the hearing.
    (c) The hearing must be held at the place and at the time ordered by 
the ALJ.

(Authority: 31 U.S.C. 3803(g)(4))



Sec. 33.33  Witnesses.

    (a) Except as provided in paragraph (b) of this section, testimony 
at the hearing must be given orally by witnesses under oath or 
affirmation.
    (b) At the discretion of the ALJ, testimony may be admitted in the 
form of a written statement or deposition. Any such written statement 
must be provided to all other parties along with the last known address 
of the witness, in a manner that allows sufficient time for other 
parties to subpoena the witness for cross-examination at the hearing. 
Prior written statements of witnesses proposed to testify at the hearing 
and deposition transcripts must be exchanged as provided in 
Sec. 33.22(a).
    (c) The ALJ shall exercise reasonable control over the mode and 
order of interrogating witnesses and presenting evidence so as to:
    (1) Make the interrogation and presentation effective for the 
ascertainment of the truth;
    (2) Avoid needless consumption of time; and
    (3) Protect witnesses from harassment or undue embarrassment.
    (d) The ALJ shall permit the parties to conduct such cross-
examination as may be required for a full and true disclosure of the 
facts.
    (e) At the discretion of the ALJ, a witness may be cross-examined on 
matters relevant to the proceeding without regard to the scope of his or 
her direct examination. To the extent permitted by the ALJ, cross-
examination on matters outside the scope of direct examination must be 
conducted in the manner of direct examination and may proceed by leading 
questions only if the witness is a hostile witness, an adverse party, or 
a witness identified with an adverse party.
    (f) Upon motion of any party, the ALJ shall order witnesses excluded 
so that they cannot hear the testimony of other witnesses. This rule 
does not authorize exclusion of--
    (1) A party who is an individual;
    (2) In the case of a party that is not an individual, an officer or 
employee of the party appearing for the party pro se or designated by 
the party's representative; or
    (3) An individual whose presence is shown by a party to be essential 
to the presentation of its case, including an

[[Page 86]]

individual employed by the Government engaged in assisting the 
representative for the Government.

(Authority: 31 U.S.C. 3803(g)(2)(E); 3809))



Sec. 33.34  Evidence.

    (a) The ALJ shall determine the admissibility of evidence.
    (b) Except as provided in this part, the ALJ is not bound by the 
Federal Rules of Evidence. However, the ALJ may apply the Federal Rules 
of Evidence if appropriate, e.g., to exclude unreliable evidence.
    (c) The ALJ shall exclude irrelevant and immaterial evidence.
    (d) Although relevant, evidence may be excluded if its probative 
value is substantially outweighted by the danger of unfair prejudice, 
confusion of the issues, or by considerations of undue delay or needless 
presentation of cumulative evidence.
    (e) Although relevant, evidence may be excluded if it is privileged 
under Federal law.
    (f) Evidence concerning offers of compromise or settlement are 
inadmissible to the extend provided in Rule 408 of the Federal Rules of 
Evidence.
    (g) The ALJ shall permit the parties to introduce rebuttal witnesses 
and evidence.
    (h) All Documents and other evidence offered or taken for the record 
must be open to examination by all parties, unless otherwise ordered by 
the ALJ pursuant to Sec. 33.24.

(Authority: 31 U.S.C. 3803(f)(g)(2)(E))



Sec. 33.35  The record.

    (a) The hearing must be recorded and transcribed. Transcripts may be 
obtained following the hearing from the ALJ at a cost not to exceed the 
actual cost of duplication.

(Authority: 31 U.S.C. 3803 (f))

    (b) The transcript of testimony, exhibits and other evidence 
admitted at the hearing, and all papers and requests filed in the 
proceeding constitute the record for the decision by the ALJ and the 
Department head.
    (c) The record may be inspected and copied (upon payment of a 
reasonable fee) by anyone, unless otherwise ordered by the ALJ pursuant 
to Sec. 33.24.

(Authority: 5 U.S.C. App. 2, section 11)



Sec. 33.36  Post-hearing briefs.

    The ALJ may require the parties to file post-hearing briefs. In any 
event, any party may file a post-hearing brief. The ALJ shall fix the 
time for filing these briefs, not to exceed 60 days from the date the 
parties receive the transcript of the hearing or, if applicable, the 
stipulated record. The briefs may be accompanied by proposed findings of 
fact and conclusions of law. The ALJ may permit the parties to file 
reply briefs.

(Authority: 31 U.S.C. 3803 (g)(1)(2)(E))



Sec. 33.37  Initial decision.

    (a) The ALJ shall issue an initial decision, based only on the 
record, that contains findings of fact, conclusions of law, and the 
amount of any penalties and assessments imposed.
    (b) The findings of fact must include a finding on each of the 
following issues:
    (1) Whether the claims or statements identified in the complaint, or 
any portions of the complaint, violate Sec. 33.3.
    (2) If the person is liable for penalties or assessments, the 
appropriate amount of any such penalties or assessments considering any 
mitigating or aggravating factors that the ALJ finds in the case, such 
as those described in Sec. 33.31.
    (c) The ALJ shall promptly serve the initial decision on all parties 
within 90 days after the time for submission of post-hearing briefs and 
reply briefs (if permitted) has expired. The ALJ shall at the same time 
serve all parties with a statement describing the right of any defendant 
determined to be liable for a civil penalty or assessment to file a 
motion for reconsideration with the ALJ or a notice of appeal with the 
Department head. If the ALJ fails to meet the deadline contained in this 
paragraph, he or she shall notify the parties of the reasons for the 
delay and shall set a new deadline.
    (d) Unless the initial decision of the ALJ is timely appealed to the 
Department head, or a motion for reconsideration of the initial decision 
is timely

[[Page 87]]

filed, the initial decision shall constitute the final decision of the 
Department head and shall be final and binding on the parties 30 days 
after it is issued by the ALJ.

(Authority: 31 U.S.C. 3803(h)(i))



Sec. 33.38  Reconsideration of initial decision.

    (a) Except as provided in paragraph (d) of this section, any party 
may file a motion for reconsideration of the initial decision within 20 
days of receipt of the initial decision. If service was made by mail, 
receipt is presumed to be five days from the date of mailing in the 
absence of contrary proof.
    (b) Every motion under paragraph (a) of this section must set forth 
the matters claimed to have been erroneously decided and the nature of 
the alleged errors. The motion must be accompanied by a supporting 
brief.
    (c) Responses to the motion are allowed only upon request to the 
ALJ.
    (d) No party may file a motion for reconsideration of an initial 
decision that has been revised in response to a previous motion for 
reconsideration.
    (e) The ALJ may dispose of a motion for reconsideration by denying 
it or by issuing a revised initial decision.
    (f) If the ALJ denies a motion for reconsideration, the initial 
decision shall constitute the final decision of the Department head and 
shall be final and binding on the parties 30 days after the ALJ denies 
the motion, unless the initial decision is timely appealed to the 
Department head in accordance with Sec. 33.39.
    (g) If the ALJ issues a revised initial decision, that decision 
shall constitute the final decision of the Department head and shall be 
final and binding on the parties 30 days after it is issued, unless it 
is timely appealed to the Department head in accordance with Sec. 33.39.

(Authority: 31 U.S.C. 3809)



Sec. 33.39  Appeal to Department head.

    (a) Any defendant who has filed a timely answer and who is 
determined in an initial decision to be liable for a civil penalty or 
assessment may appeal the decision to the Department head by filing a 
notice of appeal with the Department head in accordance with this 
section.
    (b)(1) A notice of appeal may be filed at any time within 30 days 
after the ALJ issues a final decision. However, if another party files a 
motion for reconsideration under Sec. 33.38, consideration of the appeal 
shall be stayed automatically pending resolution of the motion for 
reconsideration.
    (2) If a motion for reconsideration is timely filed, a notice of 
appeal may be filed within 30 days after the ALJ denies the motion or 
issues a revised initial decision, whichever applies.
    (3) The Department head may extend the initial 30-day period for an 
additional 30 days if the defendant files with the Department head a 
request for an extension within the initial 30-day period and shows good 
cause.
    (c) If the defendant files a timely notice of appeal with the 
Department head, and the time for filing motions for reconsideration 
under Sec. 33.38 has expired, the ALJ shall forward the record of the 
proceeding to the Department head.
    (d) A notice of appeal must be accompanied by a written brief 
specifying exceptions to the initial decision and reasons supporting the 
exceptions.
    (e) The representative for the Government may file a brief in 
opposition to exceptions within 30 days of receiving the notice of 
appeal and accompanying brief.
    (f) There is no right to appear personally before the Department 
head.
    (g) There is no right to appeal any interlocutory ruling by the ALJ.
    (h) In reviewing the initial decision, the Department head does not 
consider any objection that was not raised before the ALJ unless a 
demonstration is made of extraordinary circumstances causing the failure 
to raise the objection.
    (i) If any party demonstrates to the satisfaction of the Department 
head that additional evidence not presented at such hearing is material 
and that there were reasonable grounds for the failure to present that 
evidence at the hearing, the Department head shall remand the matter to 
the ALJ for consideration of the additional evidence.
    (j) The Department head affirms, reduces, reverses, compromises, 
remands,

[[Page 88]]

or settles any penalty or assessment, determined by the ALJ in any 
initial decision.

(Authority: 31 U.S.C. 3803(i))

    (k) The Department head promptly serves each party to the appeal 
with a copy of the decision of the Department head and a statement 
describing the right of any person determined to be liable for a penalty 
or assessment to seek judicial review.

(Authority: 31 U.S.C. 3803(i)(2))

    (l) Unless a petition for review is filed as provided in 31 U.S.C. 
3805, after a defendant has exhausted all administrative remedies under 
this part and within 60 days after the date on which the Department head 
serves the defendant with a copy of the Department head's decision, a 
determination that a defendant is liable under Sec. 33.3 is final and is 
not subject to judicial review.

(Authority: 31 U.S.C. 3805(a)(2))



Sec. 33.40  Stays ordered by the Department of Justice.

    If at any time the Attorney General or an Assistant Attorney General 
designated by the Attorney General transmits to the Department head a 
written finding that continuation of the administrative process 
described in this part with respect to a claim or statement may 
adversely affect any pending or potential criminal or civil action 
related to such claim or statement, the Department head stays the 
process immediately. The Department head orders the process resumed only 
upon receipt of the written authorization of the Attorney General.

(Authority: 31 U.S.C. 3803(b)(3))



Sec. 33.41  Stay pending appeal.

    (a) An initial decision is stayed automatically pending disposition 
of a motion for reconsideration or of an appeal to the Department head.
    (b) No administrative stay is available following a final decision 
of the Department head.

(Authority: 31 U.S.C. 3809)



Sec. 33.42  Judicial review.

    Section 3805 of title 31, United States Code, authorizes judicial 
review by an appropriate United States District Court of a final 
decision of the Department head imposing penalties or assessments under 
this part and specifies the procedures for the review.

(Authority: 31 U.S.C. 3805)



Sec. 33.43  Collection of civil penalties and assessments.

    Section 3806 and 3808(b) of title 31, United States Code, authorize 
actions for collection of civil penalties and assessments imposed under 
this part and specify the procedures for those actions.

(Authority: 31 U.S.C. 3808(b))



Sec. 33.44  Right to administrative offset.

    The amount of any penalty or assessment that has become final, or 
for which a judgment has been entered under Sec. 33.42 or Sec. 33.43, or 
any amount agreed upon in a compromise or settlement under Sec. 33.46, 
may be collected by administrative offset under 31 U.S.C. 3716, except 
that an administrative offset may not be under this section against a 
refund of an overpayment of Federal taxes, then or later owing by the 
United States to the defendant.

(Authority: 31 U.S.C. 3806)



Sec. 33.45  Deposit in Treasury of United States.

    All amounts collected pursuant to this part are deposited as 
miscellaneous receipts in the Treasury of the United States, except as 
provided in 31 U.S.C. 3806(g).

(Authority: 31 U.S.C. 3807(b))



Sec. 33.46  Compromise or settlement.

    (a) Parties may make offers of compromise or settlement at any time.

(Authority: 31 U.S.C. 3809)

    (b) The reviewing official has the exclusive authority to compromise 
or settle a case under this part at any time after the date on which the 
reviewing official is permitted to issue a complaint and before the date 
on which the ALJ issues an initial decision.

(Authority: 31 U.S.C. 3803(j))

    (c) The Department head has exclusive authority to compromise or 
settle

[[Page 89]]

a case under this part at any time after the date on which the ALJ 
issues an initial decision, except during the pendency of any review 
under Sec. 33.42 or during the pendency of any action to collect 
penalties and assessments under Sec. 33.43.

(Authority: 31 U.S.C. 3803(i)(2)(C))

    (d) The Attorney General has exclusive authority to compromise or 
settle a case under this part during the pendency of any review under 
Sec. 33.42 or of any action to recover penalties and assessments under 
31 U.S.C. 3806.

(Authority: 31 U.S.C. 3806(f))

    (e) The investigating official may recommend settlement terms to the 
reviewing official, the Department head, or the Attorney General, as 
appropriate. The reviewing official may recommend settlement terms to 
the Department head, or the Attorney General, as appropriate.

(Authority: 31 U.S.C. 3809)

    (f) Any compromise or settlement must be in writing.

(Authority: 31 U.S.C. 3809)



Sec. 33.47  Limitations.

    (a) The notice of hearing with respect to a claim or statement must 
be served in the manner specified in Sec. 33.8 within six years after 
the date on which the claim or statement is made.
    (b) If the defendant fails to file a timely answer, service of a 
notice under Sec. 33.10(b) is deemed a notice of hearing for purposes of 
this section.
    (c) The statute of limitations may be extended by agreement of the 
parties.

(Authority: 31 U.S.C. 3808)



PART 34_ADMINISTRATIVE WAGE GARNISHMENT--Table of Contents



Sec.
34.1  Purpose of this part.
34.2  Scope of this part.
34.3  Definitions.
34.4  Notice of proposed garnishment.
34.5  Contents of a notice of proposed garnishment.
34.6  Rights in connection with garnishment.
34.7  Consideration of objection to the rate or amount of withholding.
34.8  Providing a hearing.
34.9  Conditions for an oral hearing.
34.10  Conditions for a paper hearing.
34.11  Timely request for a hearing.
34.12  Request for reconsideration.
34.13  Conduct of a hearing.
34.14  Burden of proof.
34.15  Consequences of failure to appear for an oral hearing.
34.16  Issuance of the hearing decision.
34.17  Content of decision.
34.18  Issuance of the wage garnishment order.
34.19  Amounts to be withheld under a garnishment order.
34.20  Amount to be withheld under multiple garnishment orders.
34.21  Employer certification.
34.22  Employer responsibilities.
34.23  Exclusions from garnishment.
34.24  Claim of financial hardship by debtor subject to garnishment.
34.25  Determination of financial hardship.
34.26  Ending garnishment.
34.27  Actions by employer prohibited by law.
34.28  Refunds of amounts collected in error.
34.29  Enforcement action against employer for noncompliance with 
          garnishment order.
34.30  Application of payments and accrual of interest.

    Authority: 31 U.S.C. 3720D, unless otherwise noted.

    Source: 68 FR 8142, Feb. 19, 2003, unless otherwise noted.



Sec. 34.1  Purpose of this part.

    This part establishes procedures the Department of Education uses to 
collect money from a debtor's disposable pay by means of administrative 
wage garnishment to satisfy delinquent debt owed to the United States.

(Authority: 31 U.S.C. 3720D)



Sec. 34.2  Scope of this part.

    (a) This part applies to collection of any financial obligation owed 
to the United States that arises under a program we administer.
    (b) This part applies notwithstanding any provision of State law.
    (c) We may compromise or suspend collection by garnishment of a debt 
in accordance with applicable law.
    (d) We may use other debt collection remedies separately or in 
conjunction with administrative wage garnishment to collect a debt.
    (e) To collect by offset from the salary of a Federal employee, we 
use the

[[Page 90]]

procedures in 34 CFR part 31, not those in this part.

(Authority: 31 U.S.C. 3720D)



Sec. 34.3  Definitions.

    As used in this part, the following definitions apply:
    Administrative debt means a debt that does not arise from an 
individual's obligation to repay a loan or an overpayment of a grant 
received under a student financial assistance program authorized under 
Title IV of the Higher Education Act.
    Business day means a day Monday through Friday, unless that day is a 
Federal holiday.
    Certificate of service means a certificate signed by an authorized 
official of the U.S. Department of Education (the Department) that 
indicates the nature of the document to which it pertains, the date we 
mail the document, and to whom we are sending the document.
    Day means calendar day. For purposes of computation, the last day of 
a period will be included unless that day is a Saturday, a Sunday, or a 
Federal legal holiday; in that case, the last day of the period is the 
next business day after the end of the period.
    Debt or claim means any amount of money, funds, or property that an 
appropriate official of the Department has determined an individual owes 
to the United States under a program we administer.
    Debtor means an individual who owes a delinquent nontax debt to the 
United States under a program we administer.
    Disposable pay. This term--
    (a)(1) Means that part of a debtor's compensation for personal 
services, whether or not denominated as wages, from an employer that 
remains after the deduction of health insurance premiums and any amounts 
required by law to be withheld.
    (2) For purposes of this part, ``amounts required by law to be 
withheld'' include amounts for deductions such as social security taxes 
and withholding taxes, but do not include any amount withheld under a 
court order; and
    (b) Includes, but is not limited to, salary, bonuses, commissions, 
or vacation pay.
    Employer. This term--
    (a) Means a person or entity that employs the services of another 
and that pays the latter's wages or salary;
    (b) Includes, but is not limited to, State and local governments; 
and
    (c) Does not include an agency of the Federal Government.
    Financial hardship means an inability to meet basic living expenses 
for goods and services necessary for the survival of the debtor and his 
or her spouse and dependents.
    Garnishment means the process of withholding amounts from an 
employee's disposable pay and paying those amounts to a creditor in 
satisfaction of a withholding order.
    We means the United States Department of Education.
    Withholding order. (a) This term means any order for withholding or 
garnishment of pay issued by this Department, another Federal agency, a 
State or private non-profit guaranty agency, or a judicial or 
administrative body.
    (b) For purposes of this part, the terms ``wage garnishment order'' 
and ``garnishment order'' have the same meaning as ``withholding 
order.''
    You means the debtor.

(Authority: 31 U.S.C. 3720D)



Sec. 34.4  Notice of proposed garnishment.

    (a) We may start proceedings to garnish your wages whenever we 
determine that you are delinquent in paying a debt owed to the United 
States under a program we administer.
    (b) We start garnishment proceedings by sending you a written notice 
of the proposed garnishment.
    (c) At least 30 days before we start garnishment proceedings, we 
mail the notice by first class mail to your last known address.
    (d)(1) We keep a copy of a certificate of service indicating the 
date of mailing of the notice.
    (2) We may retain this certificate of service in electronic form.

(Authority: 31 U.S.C. 3720D)



Sec. 34.5  Contents of a notice of proposed garnishment.

    In a notice of proposed garnishment, we inform you of--

[[Page 91]]

    (a) The nature and amount of the debt;
    (b) Our intention to collect the debt through deductions from pay 
until the debt and all accumulated interest, penalties, and collection 
costs are paid in full; and
    (c) An explanation of your rights, including those in Sec. 34.6, and 
the time frame within which you may exercise your rights.

(Authority: 31 U.S.C. 3720D)



Sec. 34.6  Rights in connection with garnishment.

    Before starting garnishment, we provide you the opportunity--
    (a) To inspect and copy our records related to the debt;
    (b) To enter into a written repayment agreement with us to repay the 
debt under terms we consider acceptable;
    (c) For a hearing in accordance with Sec. 34.8 concerning--
    (1) The existence, amount, or current enforceability of the debt;
    (2) The rate at which the garnishment order will require your 
employer to withhold pay; and
    (3) Whether you have been continuously employed less than 12 months 
after you were involuntarily separated from employment.

(Authority: 31 U.S.C. 3720D)



Sec. 34.7  Consideration of objection to the rate or amount of withholding.

    (a) We consider objections to the rate or amount of withholding only 
if the objection rests on a claim that withholding at the proposed rate 
or amount would cause financial hardship to you and your dependents.
    (b) We do not provide a hearing on an objection to the rate or 
amount of withholding if the rate or amount we propose to be withheld 
does not exceed the rate or amount agreed to under a repayment agreement 
reached within the preceding six months after a previous notice of 
proposed garnishment.
    (c) We do not consider an objection to the rate or amount of 
withholding based on a claim that by virtue of 15 U.S.C. 1673, no amount 
of wages are available for withholding by the employer.

(Authority: 31 U.S.C. 3720D)



Sec. 34.8  Providing a hearing.

    (a) We provide a hearing if you submit a written request for a 
hearing concerning the existence, amount, or enforceability of the debt 
or the rate of wage withholding.
    (b) At our option the hearing may be an oral hearing under Sec. 34.9 
or a paper hearing under Sec. 34.10.

(Authority: 31 U.S.C. 3720D)



Sec. 34.9  Conditions for an oral hearing.

    (a) We provide an oral hearing if you--
    (1) Request an oral hearing; and
    (2) Show in the request a good reason to believe that we cannot 
resolve the issues in dispute by review of the documentary evidence, by 
demonstrating that the validity of the claim turns on the credibility or 
veracity of witness testimony.
    (b) If we determine that an oral hearing is appropriate, we notify 
you how to receive the oral hearing.
    (c)(1) At your option, an oral hearing may be conducted either in-
person or by telephone conference.
    (2) We provide an in-person oral hearing with regard to 
administrative debts only in Washington D.C.
    (3) We provide an in-person oral hearing with regard to debts based 
on student loan or grant obligations only at our regional service 
centers in Atlanta, Chicago, or San Francisco.
    (4) You must bear all travel expenses you incur in connection with 
an in-person hearing.
    (5) We bear the cost of any telephone calls we place in order to 
conduct an oral hearing by telephone.
    (d)(1) To arrange the time and location of the oral hearing, we 
ordinarily attempt to contact you first by telephone call to the number 
you provided to us.
    (2) If we are unable to contact you by telephone, we leave a message 
directing you to contact us within 5 business days to arrange the time 
and place of the hearing.

[[Page 92]]

    (3) If we can neither contact you directly nor leave a message with 
you by telephone--
    (i) We notify you in writing to contact us to arrange the time and 
place of the hearing; or
    (ii) We select a time and place for the hearing, and notify you in 
writing of the time and place set for the hearing.
    (e) We consider you to have withdrawn the request for an oral 
hearing if--
    (1) Within 15 days of the date of a written notice to contact us, we 
receive no response to that notice; or
    (2) Within five business days of the date of a telephone message to 
contact us, we receive no response to that message.

(Authority: 31 U.S.C. 3720D)



Sec. 34.10  Conditions for a paper hearing.

    We provide a paper hearing--
    (a) If you request a paper hearing;
    (b) If you requested an oral hearing, but we determine under 
Sec. 34.9(e) that you have withdrawn that request;
    (c) If you fail to appear for a scheduled oral hearing, as provided 
in Sec. 34.15; or
    (d) If we deny a request for an oral hearing because we conclude 
that, by a review of the written record, we can resolve the issues 
raised by your objections.

(Authority: 31 U.S.C. 3720D)



Sec. 34.11  Timely request for a hearing.

    (a) A hearing request is timely if--
    (1) You mail the request to the office designated in the garnishment 
notice and the request is postmarked not later than the 30th day 
following the date of the notice; or
    (2) The designated office receives the request not later than the 
30th day following the date of the garnishment notice.
    (b) If we receive a timely written request from you for a hearing, 
we will not issue a garnishment order before we--
    (1) Provide the requested hearing; and
    (2) Issue a written decision on the objections you raised.
    (c) If your written request for a hearing is not timely--
    (1) We provide you a hearing; and
    (2) We do not delay issuance of a garnishment order unless--
    (i) We determine from credible representations in the request that 
the delay in filing the request for hearing was caused by factors over 
which you had no control; or
    (ii) We have other good reason to delay issuing a garnishment order.
    (d) If we do not complete a hearing within 60 days of an untimely 
request, we suspend any garnishment order until we have issued a 
decision.

(Authority: 31 U.S.C. 3720D)



Sec. 34.12  Request for reconsideration.

    (a) If you have received a decision on an objection to garnishment 
you may file a request for reconsideration of that decision.
    (b) We do not suspend garnishment merely because you have filed a 
request for reconsideration.
    (c) We consider your request for reconsideration if we determine 
that--
    (1) You base your request on grounds of financial hardship, and your 
financial circumstances, as shown by evidence submitted with the 
request, have materially changed since we issued the decision so that we 
should reduce the amount to be garnished under the order; or
    (2)(i) You submitted with the request evidence that you did not 
previously submit; and
    (ii) This evidence demonstrates that we should reconsider your 
objection to the existence, amount, or enforceability of the debt.
    (d)(1) If we agree to reconsider the decision, we notify you.
    (2)(i) We may reconsider based on the request and supporting 
evidence you have presented with the request; or
    (ii) We may offer you an opportunity for a hearing to present 
evidence.

(Authority: 31 U.S.C. 3720D)



Sec. 34.13  Conduct of a hearing.

    (a)(1) A hearing official conducts any hearing under this part.
    (2) The hearing official may be any qualified employee of the 
Department whom the Department designates to conduct the hearing.

[[Page 93]]

    (b)(1) The hearing official conducts any hearing as an informal 
proceeding.
    (2) A witness in an oral hearing must testify under oath or 
affirmation.
    (3) The hearing official maintains a summary record of any hearing.
    (c) Before the hearing official considers evidence we obtain that 
was not included in the debt records available for inspection when we 
sent notice of proposed garnishment, we notify you that additional 
evidence has become available, may be considered by the hearing 
official, and is available for inspection or copying.
    (d) The hearing official considers any objection you raise and 
evidence you submit--
    (1) In or with the request for a hearing;
    (2) During an oral hearing;
    (3) By the date that we consider, under Sec. 34.9(e), that a request 
for an oral hearing has been withdrawn; or
    (4) Within a period we set, ordinarily not to exceed seven business 
days, after--
    (i) We provide you access to our records regarding the debt, if you 
requested access to records within 20 days after the date of the notice 
under Sec. 34.4;
    (ii) We notify you that we have obtained and intend to consider 
additional evidence;
    (iii) You request an extension of time in order to submit specific 
relevant evidence that you identify to us in the request; or
    (iv) We notify you that we deny your request for an oral hearing.

(Authority: 31 U.S.C. 3720D)



Sec. 34.14  Burden of proof.

    (a)(1) We have the burden of proving the existence and amount of a 
debt.
    (2) We meet this burden by including in the record and making 
available to the debtor on request records that show that--
    (i) The debt exists in the amount stated in the garnishment notice; 
and
    (ii) The debt is currently delinquent.
    (b) If you dispute the existence or amount of the debt, you must 
prove by a preponderance of the credible evidence that--
    (1) No debt exists;
    (2) The amount we claim to be owed on the debt is incorrect, or
    (3) You are not delinquent with respect to the debt.
    (c)(1) If you object that the proposed garnishment rate would cause 
financial hardship, you bear the burden of proving by a preponderance of 
the credible evidence that withholding the amount of wages proposed in 
the notice would leave you unable to meet the basic living expenses of 
you and your dependents.
    (2) The standards for proving financial hardship are those in 
Sec. 34.24.
    (d)(1) If you object on the ground that applicable law bars us from 
collecting the debt by garnishment at this time, you bear the burden of 
proving the facts that would establish that claim.
    (2) Examples of applicable law that may prevent collection by 
garnishment include the automatic stay in bankruptcy (11 U.S.C. 362(a)), 
and the preclusion of garnishment action against a debtor who was 
involuntarily separated from employment and has been reemployed for less 
than a continuous period of 12 months (31 U.S.C. 3720D(b)(6)).
    (e) The fact that applicable law may limit the amount that an 
employer may withhold from your pay to less than the amount or rate we 
state in the garnishment order does not bar us from issuing the order.

(Authority: 31 U.S.C. 3720D)



Sec. 34.15  Consequences of failure to appear for an oral hearing.

    (a) If you do not appear for an in-person hearing you requested, or 
you do not answer a telephone call convening a telephone hearing, at the 
time set for the hearing, we consider you to have withdrawn your request 
for an oral hearing.
    (b) If you do not appear for an oral hearing but you demonstrate 
that there was good cause for not appearing, we may reschedule the oral 
hearing.
    (c) If you do not appear for an oral hearing you requested and we do 
not reschedule the hearing, we provide a paper hearing to review your 
objections, based on the evidence in your

[[Page 94]]

file and any evidence you have already provided.

(Authority: 31 U.S.C. 3720D)



Sec. 34.16  Issuance of the hearing decision.

    (a) Date of decision. The hearing official issues a written opinion 
stating his or her decision, as soon as practicable, but not later than 
60 days after the date on which we received the request for hearing.
    (b) If we do not provide you with a hearing and render a decision 
within 60 days after we receive your request for a hearing--
    (1) We do not issue a garnishment order until the hearing is held 
and a decision rendered; or
    (2) If we have already issued a garnishment order to your employer, 
we suspend the garnishment order beginning on the 61st day after we 
receive the hearing request until we provide a hearing and issue a 
decision.

(Authority: 31 U.S.C. 3720D)



Sec. 34.17  Content of decision.

    (a) The written decision is based on the evidence contained in the 
hearing record. The decision includes--
    (1) A description of the evidence considered by the hearing 
official;
    (2) The hearing official's findings, analysis, and conclusions 
regarding objections raised to the existence or amount of the debt;
    (3) The rate of wage withholding under the order, if you objected 
that withholding the amount proposed in the garnishment notice would 
cause an extreme financial hardship; and
    (4) An explanation of your rights under this part for 
reconsideration of the decision.
    (b) The hearing official's decision is the final action of the 
Secretary for the purposes of judicial review under the Administrative 
Procedure Act (5 U.S.C. 701 et seq.).

(Authority: 31 U.S.C. 3720D)



Sec. 34.18  Issuance of the wage garnishment order.

    (a)(1) If you fail to make a timely request for a hearing, we issue 
a garnishment order to your employer within 30 days after the deadline 
for timely requesting a hearing.
    (2) If you make a timely request for a hearing, we issue a 
withholding order within 30 days after the hearing official issues a 
decision to proceed with garnishment.
    (b)(1) The garnishment order we issue to your employer is signed by 
an official of the Department designated by the Secretary.
    (2) The designated official's signature may be a computer-generated 
facsimile.
    (c)(1) The garnishment order contains only the information we 
consider necessary for your employer to comply with the order and for us 
to ensure proper credit for payments received from your employer.
    (2) The order includes your name, address, and social security 
number, as well as instructions for withholding and information as to 
where your employer must send the payments.
    (d)(1) We keep a copy of a certificate of service indicating the 
date of mailing of the order.
    (2) We may create and maintain the certificate of service as an 
electronic record.

(Authority: 31 U.S.C. 3720D)



Sec. 34.19  Amounts to be withheld under a garnishment order.

    (a)(1) After an employer receives a garnishment order we issue, the 
employer must deduct from all disposable pay of the debtor during each 
pay period the amount directed in the garnishment order unless this 
section or Sec. 34.20 requires a smaller amount to be withheld.
    (2) The amount specified in the garnishment order does not apply if 
other law, including this section, requires the employer to withhold a 
smaller amount.
    (b) The employer must comply with our garnishment order by 
withholding the lesser of--
    (1) The amount directed in the garnishment order; or--
    (2) The amount specified in 15 U.S.C. 1673(a)(2) (Restriction on 
Garnishment); that is, the amount by which a debtor's disposable pay 
exceeds an

[[Page 95]]

amount equal to 30 times the minimum wage. (See 29 CFR 870.10.)

(Authority: 31 U.S.C. 3720D)



Sec. 34.20  Amount to be withheld under multiple garnishment orders.

    If a debtor's pay is subject to several garnishment orders, the 
employer must comply with our garnishment order as follows:
    (a) Unless other Federal law requires a different priority, the 
employer must pay us the amount calculated under Sec. 34.19(b) before 
the employer complies with any later garnishment orders, except a family 
support withholding order.
    (b) If an employer is withholding from a debtor's pay based on a 
garnishment order served on the employer before our order, or if a 
withholding order for family support is served on an employer at any 
time, the employer must comply with our garnishment order by withholding 
an amount that is the smaller of--
    (1) The amount calculated under Sec. 34.19(b); or
    (2) An amount equal to 25 percent of the debtor's disposable pay 
less the amount or amounts withheld under the garnishment order or 
orders with priority over our order.
    (c)(1) If a debtor owes more than one debt arising from a program we 
administer, we may issue multiple garnishment orders.
    (2) The total amount withheld from the debtor's pay for orders we 
issue under paragraph (c)(1) of this section does not exceed the amounts 
specified in the orders, the amount specified in Sec. 34.19(b)(2), or 15 
percent of the debtor's disposable pay, whichever is smallest.
    (d) An employer may withhold and pay an amount greater than that 
amount in paragraphs (b) and (c) of this section if the debtor gives the 
employer written consent.

(Authority: 31 U.S.C. 3720D)



Sec. 34.21  Employer certification.

    (a) Along with a garnishment order, we send to an employer a 
certification in a form prescribed by the Secretary of the Treasury.
    (b) The employer must complete and return the certification to us 
within the time stated in the instructions for the form.
    (c) The employer must include in the certification information about 
the debtor's employment status, payment frequency, and disposable pay 
available for withholding.

(Authority: 31 U.S.C. 3720D)



Sec. 34.22  Employer responsibilities.

    (a)(1) Our garnishment order indicates a reasonable period of time 
within which an employer must start withholding under the order.
    (2) The employer must promptly pay to the Department all amounts the 
employer withholds according to the order.
    (b) The employer may follow its normal pay and disbursement cycles 
in complying with the garnishment order.
    (c) The employer must withhold the appropriate amount from the 
debtor's wages for each pay period until the employer receives our 
notification to discontinue wage garnishment.
    (d) The employer must disregard any assignment or allotment by an 
employee that would interfere with or prohibit the employer from 
complying with our garnishment order, unless that assignment or 
allotment was made for a family support judgment or order.

(Authority: 31 U.S.C. 3720D)



Sec. 34.23  Exclusions from garnishment.

    (a) We do not garnish your wages if we have credible evidence that 
you--
    (1) Were involuntarily separated from employment; and
    (2) Have not yet been reemployed continuously for at least 12 
months.
    (b) You have the burden of informing us of the circumstances 
surrounding an involuntary separation from employment.

(Authority: 31 U.S.C. 3720D)



Sec. 34.24  Claim of financial hardship by debtor subject to garnishment.

    (a) You may object to a proposed garnishment on the ground that 
withholding the amount or at the rate stated in the notice of 
garnishment would

[[Page 96]]

cause financial hardship to you and your dependents. (See Sec. 34.7)
    (b) You may, at any time, object that the amount or the rate of 
withholding which our order specifies your employer must withhold causes 
financial hardship.
    (c)(1) We consider an objection to an outstanding garnishment order 
and provide you an opportunity for a hearing on your objection only 
after the order has been outstanding for at least six months.
    (2) We may provide a hearing in extraordinary circumstances earlier 
than six months if you show in your request for review that your 
financial circumstances have substantially changed after the notice of 
proposed garnishment because of an event such as injury, divorce, or 
catastrophic illness.
    (d)(1) You bear the burden of proving a claim of financial hardship 
by a preponderance of the credible evidence.
    (2) You must prove by credible documentation--
    (i) The amount of the costs incurred by you, your spouse, and any 
dependents, for basic living expenses; and
    (ii) The income available from any source to meet those expenses.
    (e)(1) We consider your claim of financial hardship by comparing--
    (i) The amounts that you prove are being incurred for basic living 
expenses; against
    (ii) The amounts spent for basic living expenses by families of the 
same size and similar income to yours.
    (2) We regard the standards published by the Internal Revenue 
Service under 26 U.S.C. 7122(c)(2) (the ``National Standards'') as 
establishing the average amounts spent for basic living expenses for 
families of the same size as, and with family incomes comparable to, 
your family.
    (3) We accept as reasonable the amount that you prove you incur for 
a type of basic living expense to the extent that the amount does not 
exceed the amount spent for that expense by families of the same size 
and similar income according to the National Standards.
    (4) If you claim for any basic living expense an amount that exceeds 
the amount in the National Standards, you must prove that the amount you 
claim is reasonable and necessary.

(Authority: 31 U.S.C. 3720D)



Sec. 34.25  Determination of financial hardship.

    (a)(1) If we conclude that garnishment at the amount or rate 
proposed in a notice would cause you financial hardship, we reduce the 
amount of the proposed garnishment to an amount that we determine will 
allow you to meet proven basic living expenses.
    (2) If a garnishment order is already in effect, we notify your 
employer of any change in the amount the employer must withhold or the 
rate of withholding under the order.
    (b) If we determine that financial hardship would result from 
garnishment based on a finding by a hearing official or under a 
repayment agreement we reached with you, this determination is effective 
for a period not longer than six months after the date of the finding or 
agreement.
    (c)(1) After the effective period referred to in paragraph (b) of 
this section, we may require you to submit current information regarding 
your family income and living expenses.
    (2) If we conclude from a review of that evidence that we should 
increase the rate of withholding or payment, we--
    (i) Notify you; and
    (ii) Provide you with an opportunity to contest the determination 
and obtain a hearing on the objection under the procedures in 
Sec. 34.24.

(Authority: 31 U.S.C. 3720D)



Sec. 34.26  Ending garnishment.

    (a)(1) A garnishment order we issue is effective until we rescind 
the order.
    (2) If an employer is unable to honor a garnishment order because 
the amount available for garnishment is insufficient to pay any portion 
of the amount stated in the order, the employer must--
    (i) Notify us; and
    (ii) Comply with the order when sufficient disposable pay is 
available.
    (b) After we have fully recovered the amounts owed by the debtor, 
including interest, penalties, and collection

[[Page 97]]

costs, we send the debtor's employer notification to stop wage 
withholding.

(Authority: 31 U.S.C. 3720D)



Sec. 34.27  Actions by employer prohibited by law.

    An employer may not discharge, refuse to employ, or take 
disciplinary action against a debtor due to the issuance of a 
garnishment order under this part.

(Authority: 31 U.S.C. 3720D)



Sec. 34.28  Refunds of amounts collected in error.

    (a) If a hearing official determines under Secs. 34.16 and 34.17 
that a person does not owe the debt described in our notice or that an 
administrative wage garnishment under this part was barred by law at the 
time of the collection action, we promptly refund any amount collected 
by means of this garnishment.
    (b) Unless required by Federal law or contract, we do not pay 
interest on a refund.

(Authority: 31 U.S.C. 3720D)



Sec. 34.29  Enforcement action against employer for noncompliance
with garnishment order.

    (a) If an employer fails to comply with Sec. 34.22 to withhold an 
appropriate amount from wages owed and payable to an employee, we may 
sue the employer for that amount.
    (b)(1) We do not file suit under paragraph (a) of this section 
before we terminate action to enforce the debt as a personal liability 
of the debtor.
    (2) However, the provision of paragraph (b)(1) of this section may 
not apply if earlier filing of a suit is necessary to avoid expiration 
of any applicable statute of limitations.
    (c)(1) For purposes of this section, termination of an action to 
enforce a debt occurs when we terminate collection action in accordance 
with the FCCS, other applicable standards, or paragraph (c)(2) of this 
section.
    (2) We regard termination of the collection action to have occurred 
if we have not received for one year any payments to satisfy the debt, 
in whole or in part, from the particular debtor whose wages were subject 
to garnishment.

(Authority: 31 U.S.C. 3720D)



Sec. 34.30  Application of payments and accrual of interest.

    We apply payments received through a garnishment in the following 
order--
    (a) To costs incurred to collect the debt;
    (b) To interest accrued on the debt at the rate established by--
    (1) The terms of the obligation under which it arises; or
    (2) Applicable law; and
    (c) To outstanding principal of the debt.

(Authority: 31 U.S.C. 3720D)



PART 35_TORT CLAIMS AGAINST THE GOVERNMENT--Table of Contents



                            Subpart A_General

Sec.
35.1  Scope of regulations.

                          Subpart B_Procedures

35.2  Administrative claim; when presented; place of filing.
35.3  Administrative claim; who may file.
35.4  Administrative claim; evidence and information to be submitted.
35.5  Investigation of claims.
35.6  Final denial of claim.
35.7  Payment of approved claims.
35.8  Release.
35.9  Penalties.
35.10  Limitation on Department's authority.

    Authority: Sec. 1(a), 80 Stat. 306; 28 U.S.C. 2672; 28 CFR, part 14.

    Source: 45 FR 30834, May 9, 1980, unless otherwise noted.



                            Subpart A_General



Sec. 35.1  Scope of regulations.

    The regulations in this part shall apply only to claims asserted 
under the Federal Tort Claims Act, as amended, 28 U.S.C. 2671-2680, for 
money damages against the United States for damage to or loss of 
property or personal injury or death caused by the negligent or wrongful 
act or omission of any employee of the Department of Education while 
acting within the scope of his office or employment.

[[Page 98]]



                          Subpart B_Procedures



Sec. 35.2  Administrative claim; when presented; place of filing.

    (a) For purposes of the regulations in this part, a claim shall be 
deemed to have been presented when the Department of Education receives, 
at a place designated in paragraph (b) of this section, an executed 
Standard Form 95 or other written notification of an incident 
accompanied by a claim for money damages in a sum certain for damage to 
or loss of property, for personal injury, or for death, alleged to have 
occurred by reason of the incident. A claim which should have been 
presented to the Department but which was mistakenly addressed to or 
filed with another Federal agency, shall be deemed to be presented to 
the Department as of the date that the claim is received by the 
Department. A claim mistakenly addressed to or filed with the Department 
shall forthwith be transferred to the appropriate Federal agency, if 
ascertainable, or returned to the claimant.
    (b) A claim presented in compliance with paragraph (a) of this 
section may be amended by the claimant at any time prior to final action 
by the Secretary or prior to the exercise of the claimant's option to 
bring suit under 28 U.S.C. 2675(a). Amendments shall be submitted in 
writing and signed by the claimant or his duly authorized agent or legal 
representative. Upon the timely filing of an amendment to a pending 
claim, the Department shall have 6 months in which to make a final 
disposition of the claim as amended and the claimant's option under 28 
U.S.C. 2675(a) shall not accrue until 6 months after the filing of an 
amendment.
    (c) Forms may be obtained and claims may be filed, with the 
Department of Education Claims Officer, Washington, DC 20202.



Sec. 35.3  Administrative claim; who may file.

    (a) A claim for injury to or loss of property may be presented by 
the owner of the property interest which is the subject of the claim, 
his duly authorized agent, or his legal representative.
    (b) A claim for personal injury may be presented by the injured 
person, his duly authorized agent, or his legal representative.
    (c) A claim based on death may be presented by the executor or 
administrator of the decedent's estate or by any other person legally 
entitled to assert such a claim under applicable state law.
    (d) A claim for loss wholly compensated by an insurer with the 
rights of a subrogee may be presented by the insurer. A claim for loss 
partially compensated by an insurer with the rights of a subrogee may be 
presented by the insurer or the insured individually, as their 
respective interests appear, or jointly. Whenever an insurer presents a 
claim asserting the rights of a subrogee, he shall present with his 
claim appropriate evidence that he has the rights of a subrogee.
    (e) A claim presented by an agent or legal representative shall be 
presented in the name of the claimant, be signed by the agent or legal 
representative, show the title or legal capacity of the person signing, 
and be accompanied by evidence of his authority to present a claim on 
behalf of the claimant as agent, executor, administrator, parent, 
guardian, or other representative.



Sec. 35.4  Administrative claim; evidence and information to be
submitted.

    (a) Death. In support of a claim based on death, the claimant may be 
required to submit the following evidence or information:
    (1) An authenticated death certificate or other competent evidence 
showing cause of death, date of death, and age of the decedent.
    (2) Decedent's employment or occupation at time of death, including 
his monthly or yearly salary or earnings (if any), and the duration of 
his last employment or occupation.
    (3) Full names, addresses, birth dates, kinship, and marital status 
of the decedent's survivors, including identification of those survivors 
who were dependent for support upon the decedent at the time of his 
death.
    (4) Degree of support afforded by the decedent to each survivor 
dependent upon him for support at the time of his death.

[[Page 99]]

    (5) Decedent's general physical and mental condition before death.
    (6) Itemized bills for medical and burial expenses incurred by 
reason of the incident causing death, or itemized receipts of payments 
for such expenses.
    (7) If damages for pain and suffering prior to death are claimed, a 
physician's detailed statement specifying the injuries suffered, 
duration of pain and suffering, any drugs administered for pain and the 
decedent's physical condition in the interval between injury and death.
    (8) Any other evidence or information which may have a bearing on 
either the responsibility of the United States for the death or the 
damages claimed.
    (b) Personal injury. In support of a claim for personal injury, 
including pain and suffering, the claimant may be required to submit the 
following evidence or information:
    (1) A written report by his attending physician or dentist setting 
forth the nature and extent of the injury, nature and extent of 
treatment, any degree of temporary or permanent disability, the 
prognosis, period of hospitalization, and any diminished earning 
capacity. In addition, the claimant may be required to submit to a 
physical or mental examination by a physician employed or designated by 
the Department. A copy of the report of the examining physician shall be 
made available to the claimant upon the claimant's written request 
provided that claimant has, upon request, furnished the report referred 
to in the first sentence of this paragraph and has made or agrees to 
make available to the Department any other physician's reports 
previously or thereafter made of the physical or mental condition which 
is the subject matter of his claim.
    (2) Itemized bills for medical, dental, and hospital expenses 
incurred, or itemized receipts of payment for such expenses.
    (3) If the prognosis reveals the necessity for future treatment, a 
statement of expected duration of and expenses for such treatment.
    (4) If a claim is made for loss of time from employment, a written 
statement from his employer showing actual time lost from employment, 
whether he is a full or part-time employee, and wages or salary actually 
lost.
    (5) If a claim is made for loss of income and the claimant is self-
employed, documentary evidence showing the amount of earnings actually 
lost.
    (6) Any other evidence or information which may have a bearing on 
either the responsibility of the United States for the personal injury 
or the damages claimed.
    (c) Property damage. In support of a claim for damage to or loss of 
property, real or personal, the claimant may be required to submit the 
following evidence or information:
    (1) Proof of ownership.
    (2) A detailed statement of the amount claimed with respect to each 
item of property.
    (3) An itemized receipt of payment for necessary repairs or itemized 
written estimates of the cost of such repairs.
    (4) A statement listing date of purchase, purchase price, market 
value of the property as of date of damage, and salvage value, where 
repair is not economical.
    (5) Any other evidence or information which may have a bearing 
either on the responsibility of the United States for the injury to or 
loss of property or the damages claimed.
    (d) Time limit. All evidence required to be submitted by this 
section shall be furnished by the claimant within a reasonable time. 
Failure of a claimant to furnish evidence necessary to a determination 
of his claim within three months after a request therefor has been 
mailed to his last known address may be deemed an abandonment of the 
claim. The claim may be thereupon disallowed.



Sec. 35.5  Investigation of claims.

    When a claim is received, the Department will make such 
investigation as may be necessary or appropriate for a determination of 
the validity of the claim.



Sec. 35.6  Final denial of claim.

    (a) Final denial of an administrative claim shall be in writing and 
sent to the claimant, his attorney, or legal representative by certified 
or registered mail. The notification of final

[[Page 100]]

denial may include a statement of the reasons for the denial and shall 
include a statement that, if the claimant is dissatisfied with the 
Department's action, he may file suit in an appropriate U.S. District 
Court not later than 6 months after the date of mailing of the 
notification.
    (b) Prior to the commencement of suit and prior to the expiration of 
the 6-month period after the date of mailing, by certified or registered 
mail of notice of final denial of the claim as provided in 28 U.S.C. 
2401(b), a claimant, his duly authorized agent, or legal representative, 
may file a written request with the Department for reconsideration of a 
final denial of a claim under paragraph (a) of this section. Upon the 
timely filing of a request for reconsideration the Department shall have 
6 months from the date of filing in which to make a final disposition of 
the claim and the claimant's option under 28 U.S.C. 2675(a) to bring 
suit shall not accrue until 6 months after the filing of a request for 
reconsideration. Final Department action on a request for 
reconsideration shall be effected in accordance with the provisions of 
paragraph (a) of this section.



Sec. 35.7  Payment of approved claims.

    (a) Upon allowance of his claim, claimant or his duly authorized 
agent shall sign the voucher for payment, Standard Form 1145, before 
payment is made.
    (b) When the claimant is represented by an attorney, the voucher for 
payment (SF 1145) shall designate both the claimant and his attorney as 
``payees.'' The check shall be delivered to the attorney whose address 
shall appear on the voucher.



Sec. 35.8  Release.

    Acceptance by the claimant, his agent or legal representative, of 
any award, compromise or settlement made hereunder, shall be final and 
conclusive on the claimant, his agent or legal representative and any 
other person on whose behalf or for whose benefit the claim has been 
presented, and shall constitute a complete release of any claim against 
the United States and against any employee of the Government whose act 
or omission gave rise to the claim, by reason of the same subject 
matter.



Sec. 35.9  Penalties.

    A person who files a false claim or makes a false or fraudulent 
statement in a claim against the United States may be liable to a fine 
of not more than $10,000 or to imprisonment of not more than 5 years, or 
both (18 U.S.C. 287.1001), and, in addition, to a forfeiture of $2,000 
and a penalty of double the loss or damage sustained by the United 
States (31 U.S.C. 231).



Sec. 35.10  Limitation on Department's authority.

    (a) An award, compromise or settlement of a claim hereunder in 
excess of $25,000 shall be effected only with the prior written approval 
of the Attorney General or his designee. For the purposes of this 
paragraph, a principal claim and any derivative or subrogated claim 
shall be treated as a single claim.
    (b) An administrative claim may be adjusted, determined, compromised 
or settled hereunder only after consultation with the Department of 
Justice when, in the opinion of the Department:
    (1) A new precedent or a new point of law is involved; or
    (2) A question of policy is or may be involved; or
    (3) The United States is or may be entitled to indemnity or 
contribution from a third party and the Department is unable to adjust 
the third party claim; or
    (4) The compromise of a particular claim, as a practical matter, 
will or may control the disposition of a related claim in which the 
amount to be paid may exceed $25,000.
    (c) An administrative claim may be adjusted, determined, compromised 
or settled only after consultation with the Department of Justice when 
it is learned that the United States or an employee, agent or cost plus 
contractor of the United States is involved in litigation based on a 
claim arising out of the same incident or transaction.

[[Page 101]]



PART 36_ADJUSTMENT OF CIVIL MONETARY PENALTIES FOR INFLATION--
Table of Contents



Sec.
36.1  Purpose.
36.2  Penalty adjustment.

    Authority: 20 U.S.C. 1221e-3 and 3474; 28 U.S.C. 2461 note, as 
amended by Sec. 701 of Pub. Law 114-74, unless otherwise noted.

    Source: 67 FR 69655, Nov. 18, 2002, unless otherwise noted.



Sec. 36.1  Purpose.

    The purpose of this part is to make inflation adjustments to the 
civil monetary penalties within the jurisdiction of the Department of 
Education. These penalties are subject to review and adjustment as 
necessary at least once every 4 years in accordance with the Federal 
Civil Penalties Inflation Adjustment Act of 1990, as amended.

(Authority: 20 U.S.C. 1221e-3 and 3474; 28 U.S.C. 2461 note, as amended 
by Sec. 701 of Pub. Law 114-74.)

[67 FR 69655, Nov. 18, 2002, as amended at 77 FR 60049, Oct. 2, 2012; 81 
FR 50323, Aug. 1, 2016]



Sec. 36.2  Penalty adjustment.

    The citations for the adjusted penalty provisions, a brief 
description of the penalty, and the adjusted maximum (and minimum, if 
applicable) penalty amounts are listed in Table I.

   Table I, Section 36.2--Civil Monetary Penalty Inflation Adjustments
------------------------------------------------------------------------
                                                            New maximum
                                                          (and  minimum,
            Statute                    Description        if applicable)
                                                              penalty
                                                              amount
------------------------------------------------------------------------
20 U.S.C. 1015(c)(5) (Section    Provides for a fine, as         $36,849
 131(c)(5) of the Higher          set by Congress in
 Education Act of 1965 (HEA)).    1998, of up to $25,000
                                  for failure by an
                                  institution of higher
                                  education (IHE) to
                                  provide information on
                                  the cost of higher
                                  education to the
                                  Commissioner of
                                  Education Statistics.
20 U.S.C. 1022d(a)(3) (Section   Provides for a fine, as          30,694
 205(a)(3) of the HEA).           set by Congress in
                                  2008, of up to $27,500
                                  for failure by an IHE
                                  to provide information
                                  to the State and the
                                  public regarding its
                                  teacher-preparation
                                  programs.
20 U.S.C. 1082(g) (Section       Provides for a civil             54,789
 432(g) of the HEA).              penalty, as set by
                                  Congress in 1986, of
                                  up to $25,000 for
                                  violations by lenders
                                  and guaranty agencies
                                  of Title IV of the
                                  HEA, which authorizes
                                  the Federal Family
                                  Education Loan Program.
20 U.S.C. 1094(c)(3)(B)          Provides for a civil             54,789
 (Section 487(c)(3)(B) of the     penalty, as set by
 HEA).                            Congress in 1986, of
                                  up to $25,000 for an
                                  IHE's violation of
                                  Title IV of the HEA,
                                  which authorizes
                                  various programs of
                                  student financial
                                  assistance.
20 U.S.C. 1228c(c)(2)(E)         Provides for a civil              1,617
 (Section 429 of the General      penalty, as set by
 Education Provisions Act).       Congress in 1994, of
                                  up to $1,000 for an
                                  educational
                                  organization's failure
                                  to disclose certain
                                  information to minor
                                  students and their
                                  parents.
31 U.S.C. 1352(c)(1) and         Provides for a civil          19,246 to
 (c)(2)(A).                       penalty, as set by             192,459
                                  Congress in 1989, of
                                  $10,000 to $100,000
                                  for recipients of
                                  Government grants,
                                  contracts, etc. that
                                  improperly lobby
                                  Congress or the
                                  Executive Branch with
                                  respect to the award
                                  of Government grants
                                  and contracts.
31 U.S.C. 3802(a)(1) and (a)(2)  Provides for a civil             10,957
                                  penalty, as set by
                                  Congress in 1986, of
                                  up to $5,000 for false
                                  claims and statements
                                  made to the Government.
------------------------------------------------------------------------


(Authority: 20 U.S.C. 1221e-3 and 3474; 28 U.S.C. 2461 note, as amended 
by Sec. 701 of Pub. Law 114-74).

[67 FR 69655, Nov. 18, 2002, as amended at 70 FR 298, Jan. 4, 2005; 77 
FR 60049, Oct. 2, 2012; 81 FR 50323, Aug. 1, 2016; 82 FR 18562, Apr. 20, 
2017]



PART 60_INDEMNIFICATION OF DEPARTMENT OF EDUCATION EMPLOYEES--
Table of Contents



Sec.
60.1  What are the policies of the Department regarding 
indemnification?
60.2  What procedures apply to requests for indemnification?

    Authority: 20 U.S.C. 3411, 3461, 3471, and 3474.

[[Page 102]]


    Source: 54 FR 7148, Feb. 16, 1989, unless otherwise noted.



Sec. 60.1  What are the policies of the Department regarding
indemnification?

    (a)(1) The Department of Education may indemnify, in whole or in 
part, an employee for any verdict, judgment, or other monetary award 
rendered against the employee if--
    (i) The conduct giving rise to the verdict, judgment, or award 
occurred within the scope of his or her employment with the Department; 
and
    (ii) The indemnification is in the interest of the United States, as 
determined by the Secretary.
    (2) The regulations in this part apply to an action pending against 
an ED employee as of March 30, 1989, as well as to any action commenced 
after that date.
    (3) As used in this part, the term employee includes--
    (i) A present or former officer or employee of the Department or of 
an advisory committee to the Department, including a special Government 
employee;
    (ii) An employee of another Federal agency on detail to the 
Department; or
    (iii) A student volunteer under 5 U.S.C. 3111.
    (4) As used in this part the term Secretary means the Secretary of 
the Department of Education or an official or employee of the Department 
acting for the Secretary under a delegation of authority.
    (b)(1) The Department may pay, in whole or in part, to settle or 
compromise a personal damage claim against an employee if--
    (i) The alleged conduct giving rise to the personal damage claim 
occurred within the scope of employment; and
    (ii) The settlement or compromise is in the interest of the United 
States, as determined by the Secretary.
    (2) Payment under paragraph (b)(1) of this section may include 
reimbursement, in whole or in part, of an employee for prior payment 
made by the employee under a settlement or compromise that meets the 
requirements of this section.
    (c) The Department does not indemnify or settle a personal damage 
claim before entry of an adverse verdict, judgment, or monetary award 
unless the Secretary determines that exceptional circumstances justify 
the earlier indemnification or settlement.
    (d) Any payment under this part, either to indemnify a Department of 
Education employee or to settle a personal damage claim, is contingent 
upon the availability of appropriated funds.

(Authority: 20 U.S.C. 3411, 3461, 3471, and 3474)



Sec. 60.2  What procedures apply to requests for indemnification?

    (a) When an employee of the Department of Education becomes aware 
that an action has been filed against the employee in his or her 
individual capacity as a result of conduct taken within the scope of his 
or her employment, the employee shall immediately notify the head of his 
or her principal operating component and shall cooperate with 
appropriate officials of the Department in the defense of the action.
    (b) As part of the notification in paragraph (a) of this section or 
at a later time, the employee may request--
    (1) Indemnification to satisfy a verdict, judgment, or award entered 
against the employee; or
    (2) Payment to satisfy the requirements of a settlement proposal.
    (c)(1) The employee's request must be in writing to the head of his 
or her principal operating component and must be accompanied by copies 
of the complaint and other documents filed in the action, including the 
verdict, judgment, award, settlement, or settlement proposal, as 
appropriate.
    (2)(i) As used in this section, the term principal operating 
component means an office in the Department headed by an Assistant 
Secretary, a Deputy Under Secretary, or an equivalent departmental 
officer who reports directly to the Secretary.
    (ii) The term also includes the Office of the Secretary and the 
Office of the Under Secretary.
    (d) The head of the employee's principal operating component submits 
to the General Counsel, in a timely manner, the request, together with a 
recommended disposition of the request.
    (e) The General Counsel forwards to the Secretary for decision--
    (1) The employee's request;

[[Page 103]]

    (2) The recommendation of the head of the employee's principal 
operating component; and
    (3) The General Counsel's recommendation.

(Authority: 20 U.S.C. 3411, 3461, 3471, and 3474)



PART 73_STANDARDS OF CONDUCT--Table of Contents



Sec.
73.1  Cross-reference to employee ethical conduct standards and 
          financial disclosure regulations.
73.2  Conflict of interest waiver.

Appendix to Part 73--Code of Ethics for Government Service

    Authority: 5 U.S.C. 301, 7301; 18 U.S.C. 208; and E.O. 12674, 3 CFR, 
1989 Comp., p. 215, as modified by E.O. 12731, 3 CFR, 1990 Comp., p. 
306.

    Source: 60 FR 5818, Jan. 30, 1995, unless otherwise noted.



Sec. 73.1  Cross-reference to employee ethical conduct standards
and financial disclosure regulations.

    Employees of the Department of Education are subject to the 
executive branch-wide Standards of Ethical Conduct at 5 CFR part 2635 
and to the Department of Education regulation at 5 CFR part 6301 which 
supplements the executive branch-wide standards with a requirement for 
employees to obtain prior approval to participate in certain outside 
activities. In addition, employees are subject to the executive branch-
wide financial disclosure regulations at 5 CFR part 2634.



Sec. 73.2  Conflict of interest waiver.

    If a financial interest arises from ownership by an employee--or 
other person or enterprise referred to in 5 CFR 2635.402(b)(2)--of stock 
in a widely diversified mutual fund or other regulated investment 
company that in turn owns stock in another enterprise, that financial 
interest is exempt from the prohibition in 5 CFR 2635.402(a).



     Sec. Appendix to Part 73--Code of Ethics for Government Service

    Any person in Government service should:
    Put loyalty to the highest moral principles and to country above 
loyalty to persons, party, or Government department.
    Uphold the Constitution, laws, and regulations of the United States 
and of all governments therein and never be a party to their evasion.
    Give a full day's labor for a full day's pay; giving earnest effort 
and best thought to the performance of duties.
    Seek to find and employ more efficient and economical ways of 
getting tasks accomplished.
    Never discriminate unfairly by the dispensing of special favors or 
privileges to anyone, whether for remuneration or not; and never accept, 
for himself or herself or for family members, favors or benefits under 
circumstances which might be construed by reasonable persons as 
influencing the performance of governmental duties.
    Make no private promises of any kind binding upon the duties of 
office, since a Government employee has no private word which can be 
binding on public duty.
    Engage in no business with the Government, either directly or 
indirectly, which is inconsistent with the conscientious performance of 
governmental duties.
    Never use any information gained confidentially in the performance 
of governmental duties as a means of making private profit.
    Expose corruption wherever discovered.
    Uphold these principles, ever conscious that public office is a 
public trust.

(This Code of Ethics was unanimously passed by the United States 
Congress on June 27, 1980, and signed into law as Public Law 96-303 by 
the President on July 3, 1980.)



PART 75_DIRECT GRANT PROGRAMS--Table of Contents



                            Subpart A_General

             Regulations That Apply to Direct Grant Programs

Sec.
75.1  Programs to which part 75 applies.
75.2  Exceptions in program regulations to part 75.
75.4  Department contracts.

                         Eligibility for a Grant

75.50  How to find out whether you are eligible.
75.51  How to prove nonprofit status.
75.52  Eligibility of faith-based organizations for a grant and 
          nondiscrimination against those organizations.

       Ineligibility of Certain Individuals To Receive Assistance

75.60  Individuals ineligible to receive assistance.
75.61  Certification of eligibility; effect of ineligibility.

[[Page 104]]

75.62  Requirements applicable to entities making certain awards.

Subpart B [Reserved]

                   Subpart C_How To Apply for a Grant

                         The Application Notice

75.100  Publication of an application notice; content of the notice.
75.101  Information in the application notice that helps an applicant 
          apply.
75.102  Deadline date for applications.
75.103  Deadline date for preapplications.
75.104  Applicants must meet procedural rules.
75.105  Annual priorities.

                          Application Contents

75.109  Changes to application; number of copies.
75.110  Information regarding performance measurement.
75.112  Include a proposed project period and a timeline.
75.117  Information needed for a multi-year project.
75.118  Requirements for a continuation award.
75.119  Information needed if private school students participate.

               Separate Applications--Alternative Programs

75.125  Submit a separate application to each program.
75.126  Application must list all programs to which it is submitted.

                           Group Applications

75.127  Eligible parties may apply as a group.
75.128  Who acts as applicant; the group agreement.
75.129  Legal responsibilities of each member of the group.

                         Competition Exceptions

75.135  Competition exception for proposed implementation sites, 
          implementation partners, or service providers.

                        State Comment Procedures

75.155  Review procedure if State may comment on applications: Purpose 
          of Secs. 75.156-75.158.
75.156  When an applicant under Sec. 75.155 must submit its application 
          to the State; proof of submission.
75.157  The State reviews each application.
75.158  Deadlines for State comments.
75.159  Effect of State comments or failure to comment.

           Development of Curricula or Instructional Materials

75.190  Consultation.
75.191  Consultation costs.
75.192  Dissemination.

                      Subpart D_How Grants Are Made

                        Selection of New Projects

75.200  How applications for new grants and cooperative agreements are 
          selected for funding; standards for use of cooperative 
          agreements.
75.201  How the selection criteria will be used.
75.202-75.206  [Reserved]
75.209  Selection criteria based on statutory or regulatory provisions.
75.210  General selection criteria.
75.211  Selection criteria for unsolicited applications.

                          Selection Procedures

75.215  How the Department selects a new project: purpose of 
          Secs. 75.216-75.222.
75.216  Applications not evaluated for funding.
75.217  How the Secretary selects applications for new grants.
75.218  Applications not evaluated or selected for funding.
75.219  Exceptions to the procedures under Sec. 75.217.
75.220  Procedures the Department uses under Sec. 75.219(a).
75.221  Procedures the Department uses under Sec. 75.219(b).
75.222  Procedures the Department uses under Sec. 75.219(c).
75.223  [Reserved]
75.224  What are the procedures for using a multiple tier review process 
          to evaluate applications?
75.225  What procedures does the Secretary use if the Secretary decides 
          to give special consideration to novice applications?
75.226  What procedures does the Secretary use if the Secretary decides 
          to give special consideration to applications supported by 
          strong or moderate evidence of effectiveness?

                       Procedures To Make a Grant

75.230  How the Department makes a grant; purpose of Secs. 75.231-
          75.236.
75.231  Additional information.
75.232  The cost analysis; basis for grant amount.
75.233  Setting the amount of the grant.
75.234  The conditions of the grant.
75.235  The notification of grant award.
75.236  Effect of the grant.

                     Approval of Multi-Year Projects

75.250  Maximum funding period.

[[Page 105]]

75.251  Budget periods.
75.253  Continuation of a multi-year project after the first budget 
          period.
75.254  [Reserved]

                              Miscellaneous

75.260  Allotments and reallotments.
75.261  Extension of a project period.
75.262  Conversion of a grant or a cooperative agreement.
75.263  Pre-award costs; waiver of approval.
75.264  Transfers among budget categories.

           Subpart E_What Conditions Must Be Met by a Grantee?

                            Nondiscrimination

75.500  Federal statutes and regulations on nondiscrimination.

                              Project Staff

75.511  Waiver of requirement for a full-time project director.
75.515  Use of consultants.
75.516  Compensation of consultants--employees of institutions of higher 
          education.
75.517  [Reserved]
75.519  Dual compensation of staff.

                          Conflict of Interest

75.524  Conflict of interest: Purpose of Sec. 75.525.
75.525  Conflict of interest: Participation in a project.

                             Allowable Costs

75.530  General cost principles.
75.531  Limit on total cost of a project.
75.532  Use of funds for religion prohibited.
75.533  Acquisition of real property; construction.
75.534  Training grants--automatic increases for additional dependents.

                           Indirect Cost Rates

75.560  General indirect cost rates; exceptions.
75.561  Approval of indirect cost rates.
75.562  Indirect cost rates for educational training projects.
75.563  Restricted indirect cost rate--programs covered.
75.564  Reimbursement of indirect costs.
75.580  Coordination with other activities.

                               Evaluation

75.590  Evaluation by the grantee.
75.591  Federal evaluation--cooperation by a grantee.
75.592  Federal evaluation--satisfying requirement for grantee 
          evaluation.

                              Construction

75.600  Use of a grant for construction: Purpose of Secs. 75.601-75.615.
75.601  Applicant's assessment of environmental impact.
75.602  Preservation of historic sites must be described in the 
          application.
75.603  Grantee's title to site.
75.604  Availability of cost-sharing funds.
75.605  Beginning the construction.
75.606  Completing the construction.
75.607  General considerations in designing facilities and carrying out 
          construction.
75.608  Areas in the facilities for cultural activities.
75.609  Comply with safety and health standards.
75.610  Access by the handicapped.
75.611  Avoidance of flood hazards.
75.612  Supervision and inspection by the grantee.
75.613  Relocation assistance by the grantee.
75.614  Grantee must have operational funds.
75.615  Operation and maintenance by the grantee.
75.616  Energy conservation.
75.617  Compliance with the Coastal Barrier Resources Act.

                         Equipment and Supplies

75.618  Charges for use of equipment or supplies.

                       Publications and Copyrights

75.620  General conditions on publication.
75.621  [Reserved]
75.622  Definition of ``project materials.''

                         Inventions and Patents

75.626  Show Federal support; give papers to vest title.

                 Other Requirements for Certain Projects

75.650  Participation of students enrolled in private schools.
75.681  Protection of human research subjects.
75.682  Treatment of animals.
75.683  Health or safety standards for facilities.

  Subpart F_What Are the Administrative Responsibilities of a Grantee?

                 General Administrative Responsibilities

75.700  Compliance with statutes, regulations, and applications.
75.701  The grantee administers or supervises the project.
75.702  Fiscal control and fund accounting procedures.
75.703  Obligation of funds during the grant period.
75.707  When obligations are made.
75.708  Subgrants.

[[Page 106]]

75.712  Beneficiary protections: Written notice.
75.713  Beneficiary protections: Referral requirements.
75.714  Subgrants, contracts, and other agreements with faith-based 
          organizations.

                                 Reports

75.720  Financial and performance reports.
75.721  [Reserved]

                                 Records

75.730  Records related to grant funds.
75.731  Records related to compliance.
75.732  Records related to performance.
75.733  [Reserved]

                                 Privacy

75.740  Protection of and access to student records; student rights in 
          research, experimental programs, and testing.

  Subpart G_What Procedures Does the Department Use To Get Compliance?

75.900  Waiver of regulations prohibited.
75.901  Suspension and termination.
75.902  [Reserved]
75.903  Effective date of termination.
75.910  [Reserved]

Appendix A to Part 75--Form of Required Notice to Beneficiaries

    Authority: 20 U.S.C. 1221e-3 and 3474, unless otherwise noted.

    Source: 45 FR 22497, Apr. 3, 1980, unless otherwise noted. 
Redesignated at 45 FR 77368, Nov. 21, 1980.



                            Subpart A_General

             Regulations That Apply to Direct Grant Programs



Sec. 75.1  Programs to which part 75 applies.

    (a) The regulations in part 75 apply to each direct grant program of 
the Department of Education.
    (b) If a direct grant program does not have implementing 
regulations, the Secretary implements the program under the authorizing 
statute and, to the extent consistent with the authorizing statute, 
under the General Education Provisions Act and the regulations in this 
part. For the purposes of this part, the term ``direct grant program'' 
includes any grant program of the Department other than a program whose 
authorizing statute or implementing regulations provide a formula for 
allocating program funds among eligible States. With respect to Public 
Law 81-874 (the Impact Aid Program), the term ``direct grant program'' 
includes only the entitlement increase for children with disabilities 
under section 3(d)(2)(C) of Public Law 81-874 (20 U.S.C. 238(d)(2)(C) 
and disaster assistance under section 7 of that law (20 U.S.C. 241-1).

    Note: See part 76 for the general regulations that apply to programs 
that allocate funds among eligible States. For a description of the two 
kinds of direct grant programs see Sec. 75.200. Paragraph (b) of that 
section describes discretionary grant programs. Paragraph (c) of that 
section describes formula grant programs. Also see Secs. 75.201, 75.209, 
and 75.210 for the selection criteria for discretionary grant programs 
that do not have implementing regulations or whose implementing 
regulations do not include selection criteria.

(Authority: 20 U.S.C. 1221e-3 and 3474)

[45 FR 22497, Apr. 3, 1980, as amended at 45 FR 28669, Apr. 29, 1980. 
Redesignated at 45 FR 77368, Nov. 21, 1980, as amended at 45 FR 84059, 
Dec. 22, 1980, 50 FR 29330, July 18, 1985; 52 FR 27803, July 24, 1987; 
57 FR 30336, July 8, 1992; 60 FR 63873, Dec. 12, 1995]



Sec. 75.2  Exceptions in program regulations to part 75.

    If a program has regulations that are not consistent with part 75, 
the implementing regulations for that program identify the sections of 
part 75 that do not apply.

(Authority: 20 U.S.C. 1221e-3 and 3474)



Sec. 75.4  Department contracts.

    (a) A Federal contract made by the Department is governed by--
    (1) Chapters 1 and 34 of title 48 of the Code of Federal Regulations 
(Federal Acquisition Regulation and Education Department Acquisition 
Regulation).
    (2) Any applicable program regulations; and
    (3) The request for proposals for the procurement, if any, 
referenced in Commerce Business Daily.
    (b) The regulations in part 75 do not apply to a contract of the 
Department

[[Page 107]]

unless regulations in part 75 or a program's regulations specifically 
provide otherwise.

(Authority: 20 U.S.C. 1221e-3 and 3474)

[45 FR 22497, Apr. 3, 1980. Redesignated at 45 FR 77368, Nov. 21, 1980, 
as amended at 57 FR 30336, July 8, 1992]

                         Eligibility for a Grant



Sec. 75.50  How to find out whether you are eligible.

    Eligibility to apply for a grant under a program of the Department 
is governed by the authorizing statute and implementing regulations for 
that program.

(Authority: 20 U.S.C. 1221e-3 and 3474)

[45 FR 22497, Apr. 3, 1980. Redesignated at 45 FR 77368, Nov. 21, 1980, 
as amended at 52 FR 27803, July 24, 1987]



Sec. 75.51  How to prove nonprofit status.

    (a) Under some programs, an applicant must show that it is a 
nonprofit organization. (See the definition of nonprofit in 34 CFR 
77.1.)
    (b) An applicant may show that it is a nonprofit organization by any 
of the following means:
    (1) Proof that the Internal Revenue Service currently recognizes the 
applicant as an organization to which contributions are tax deductible 
under section 501(c)(3) of the Internal Revenue Code;
    (2) A statement from a State taxing body or the State attorney 
general certifying that:
    (i) The organization is a nonprofit organization operating within 
the State; and
    (ii) No part of its net earnings may lawfully benefit any private 
shareholder or individual;
    (3) A certified copy of the applicant's certificate of incorporation 
or similar document if it clearly establishes the nonprofit status of 
the applicant; or
    (4) Any item described in paragraphs (b) (1) through (3) of this 
section if that item applies to a State or national parent organization, 
together with a statement by the State or parent organization that the 
applicant is a local nonprofit affiliate.

(Authority: 20 U.S.C. 1221e-3 and 3474)



Sec. 75.52  Eligibility of faith-based organizations for a grant 
and nondiscrimination against those organizations.

    (a)(1) A faith-based organization is eligible to apply for and to 
receive a grant under a program of the Department on the same basis as 
any other private organization, with respect to programs for which such 
other organizations are eligible.
    (2) In the selection of grantees, the Department may not 
discriminate for or against a private organization on the basis of the 
organization's religious character or affiliation and must ensure that 
all decisions about grant awards are free from political interference, 
or even the appearance of such interference, and are made on the basis 
of merit, not on the basis of religion or religious belief, or the lack 
thereof.
    (b) The provisions of Sec. 75.532 apply to a faith-based 
organization that receives a grant under a program of the Department.
    (c)(1) A private organization that engages in explicitly religious 
activities, such as religious worship, instruction, or proselytization, 
must offer those activities separately in time or location from any 
programs or services supported by a grant from the Department, and 
attendance or participation in any such explicitly religious activities 
by beneficiaries of the programs and services supported by the grant 
must be voluntary.
    (2) The limitations on explicitly religious activities under 
paragraph (c)(1) of this section do not apply to a faith-based 
organization that provides services to a beneficiary under a program 
supported only by ``indirect Federal financial assistance.''
    (3) For purposes of 2 CFR 3474.15, 34 CFR 75.52, 75.712, 75.713, 
75.714, and appendix A to this part, the following definitions apply:
    (i) Direct Federal financial assistance means that the Department, a 
grantee, or a subgrantee selects a provider and either purchases goods 
or services from that provider (such as through a contract) or awards 
funds to that provider (such as through a grant, subgrant, or 
cooperative agreement) to carry out services under a program of

[[Page 108]]

the Department. Federal financial assistance shall be treated as direct 
unless it meets the definition of ``indirect Federal financial 
assistance.''
    (ii) Indirect Federal financial assistance means that the choice of 
a service provider under a program of the Department is placed in the 
hands of the beneficiary, and the cost of that service is paid through a 
voucher, certificate, or other similar means of government-funded 
payment. Federal financial assistance provided to an organization is 
``indirect'' under this definition if--
    (A) The government program through which the beneficiary receives 
the voucher, certificate, or other similar means of government-funded 
payment is neutral toward religion;
    (B) The organization receives the assistance as the result of the 
decision of the beneficiary, not a decision of the government; and
    (C) The beneficiary has at least one adequate secular option for use 
of the voucher, certificate, or other similar means of government-funded 
payment.
    Note to paragraph (c)(3): The definitions of ``direct Federal 
financial assistance'' and ``indirect Federal financial assistance'' do 
not change the extent to which an organization is considered a 
``recipient'' of ``Federal financial assistance'' as those terms are 
defined under 34 CFR parts 100, 104, 106, and 110.
    (d)(1) A faith-based organization that applies for or receives a 
grant under a program of the Department may retain its independence, 
autonomy, right of expression, religious character, and authority over 
its governance.
    (2) A faith-based organization may, among other things--
    (i) Retain religious terms in its name;
    (ii) Continue to carry out its mission, including the definition, 
development, practice, and expression of its religious beliefs;
    (iii) Use its facilities to provide services without removing or 
altering religious art, icons, scriptures, or other symbols from these 
facilities;
    (iv) Select its board members and otherwise govern itself on a 
religious basis; and
    (v) Include religious references in its mission statement and other 
chartering or governing documents.
    (e) A private organization that receives any Federal financial 
assistance under a program of the Department shall not discriminate 
against a beneficiary or prospective beneficiary in the provision of 
program services or in outreach activities on the basis of religion or 
religious belief, a refusal to hold a religious belief, or refusal to 
attend or participate in a religious practice. However, an organization 
that participates in a program funded by indirect financial assistance 
need not modify its program activities to accommodate a beneficiary who 
chooses to expend the indirect aid on the organization's program.
    (f) If a grantee contributes its own funds in excess of those funds 
required by a matching or grant agreement to supplement federally funded 
activities, the grantee has the option to segregate those additional 
funds or commingle them with the funds required by the matching 
requirements or grant agreement. However, if the additional funds are 
commingled, this section applies to all of the commingled funds.
    (g) A religious organization's exemption from the Federal 
prohibition on employment discrimination on the basis of religion, in 
section 702(a) of the Civil Rights Act of 1964, 42 U.S.C. 2000e-1, is 
not forfeited when the organization receives financial assistance from 
the Department.


(Authority: 20 U.S.C. 1221e-3 and 3474, E.O. 13559)

(Authority: 20 U.S.C. 1221e-3 and 3474)

[69 FR 31710, June 4, 2004, as amended at 81 FR 19406, Apr. 4, 2016]

       Ineligibility of Certain Individuals To Receive Assistance

    Source: Sections 75.60 through 75.62 appear at 57 FR 30337, July 8, 
1992, unless otherwise noted.



Sec. 75.60  Individuals ineligible to receive assistance.

    (a) An individual is ineligible to receive a fellowship, 
scholarship, or discretionary grant funded by the Department if the 
individual--

[[Page 109]]

    (1) Is not current in repaying a debt or is in default, as that term 
is used in 34 CFR part 668, on a debt--
    (i) Under a program listed in paragraph (b) of this section; or
    (ii) To the Federal Government under a nonprocurement transaction; 
and
    (2) Has not made satisfactory arrangements to repay the debt.
    (b) An individual who is not current in repaying a debt, or is in 
default, as that term is used in 34 CFR part 668, on a debt under a 
fellowship, scholarship, discretionary grant, or loan program, as 
included in the following list, and who has not made satisfactory 
arrangements to repay the debt, is ineligible under paragraph (a) of 
this section:
    (1) A grant awarded under the Pell Grant (20 U.S.C. 1070a, et seq.), 
National Early Intervention Scholarship and Partnership (NEISP) Program 
(20 U.S.C. 1070a-21, et seq.), Supplemental Educational Opportunity 
Grant (SEOG) (20 U.S.C. 1070b, et seq.), or State Student Incentive 
Grant (SSIG) (20 U.S.C. 1070c, et seq.) program, or a scholarship 
awarded under the Robert C. Byrd Honors Scholarship Program (20 U.S.C. 
1070d-31, et seq.), a fellowship awarded under the Jacob K. Javits 
Fellows Program (20 U.S.C. 1134h-1134k), or a fellowship awarded under 
the Patricia Roberts Harris Fellowship Program (20 U.S.C. 1134d-1134f).
    (2) A fellowship awarded under the Christa McAuliffe Fellowship 
Program (20 U.S.C. 1113-1113e), the Bilingual Education Fellowship 
Program (20 U.S.C. 3221-3262), or the Rehabilitation Long-Term Training 
Program (29 U.S.C. 774(b)).
    (3) A loan made under the Perkins Loan Program (20 U.S.C. 1087aa, et 
seq.), the Income Contingent Direct Loan Demonstration Project (20 
U.S.C. 1087a, et seq.), the Stafford Loan Program, Supplemental Loans 
for Students (SLS), PLUS, or Consolidation Loan Program (20 U.S.C. 1071, 
et seq.), or the Cuban Student Loan Program (22 U.S.C. 2601, et seq.).
    (4) A scholarship or repayment obligation incurred under the Paul 
Douglas Teacher Scholarship Program (20 U.S.C. 1111, et seq.).
    (5) A grant, or a loan, made under the Law Enforcement Education 
Program (42 U.S.C. 3775).
    (6) A stipend awarded under the Indian Fellowship Program (29 U.S.C. 
774(b)).
    (7) A scholarship awarded under the Teacher Quality Enhancement 
Grants Program (20 U.S.C. 1021 et seq.).

(Authority: 20 U.S.C. 1221e-3 and 3474)

[57 FR 30337, July 8, 1992, as amended at 59 FR 24870, May 12, 1994; 65 
FR 19609, Apr. 11, 2000]



Sec. 75.61  Certification of eligibility; effect of ineligibility.

    (a) An individual who applies for a fellowship, scholarship, or 
discretionary grant from the Department shall provide with his or her 
application a certification under the penalty of perjury--
    (1) That the individual is eligible under Sec. 75.60; and
    (2) That the individual has not been debarred or suspended by a 
judge under section 5301 of the Anti-Drug Abuse Act of 1988 (21 U.S.C. 
853a).
    (b) The Secretary specifies the form of the certification required 
under paragraph (a) of this section.
    (c) The Secretary does not award a fellowship, scholarship, or 
discretionary grant to an individual who--
    (1) Fails to provide the certification required under paragraph (a) 
of this section; or
    (2) Is ineligible, based on information available to the Secretary 
at the time the award is made.
    (d) If a fellowship, scholarship, or discretionary grant is made to 
an individual who provided a false certification under paragraph (a) of 
this section, the individual is liable for recovery of the funds made 
available under the certification, for civil damages or penalties 
imposed for false representation, and for criminal prosecution under 18 
U.S.C. 1001.

(Authority: 20 U.S.C. 1221e-3 and 3474)



Sec. 75.62  Requirements applicable to entities making certain awards.

    (a) An entity that provides a fellowship, scholarship, or 
discretionary grant to an individual under a grant from, or an agreement 
with, the Secretary shall require the individual who applies for such an 
award to provide

[[Page 110]]

with his or her application a certification under the penalty of 
perjury--
    (1) That the individual is eligible under Sec. 75.60; and
    (2) That the individual has not been debarred or suspended by a 
judge under section 5301 of the Anti-Drug Abuse Act of 1988 (21 U.S.C. 
853a).
    (b) An entity subject to this section may not award a fellowship, 
scholarship, or discretionary grant to an individual if--
    (1) The individual fails to provide the certification required under 
paragraph (a) of this section; or
    (2) The Secretary informs the entity that the individual is 
ineligible under Sec. 75.60.
    (c) If a fellowship, scholarship, or discretionary grant is made to 
an individual who provided a false certification under paragraph (a) of 
this section, the individual is liable for recovery of the funds made 
available under the certification, for civil damages or penalties 
imposed for false representation, and for criminal prosecution under 18 
U.S.C. 1001.
    (d) The Secretary may require an entity subject to this section to 
provide a list of the individuals to whom fellowship, scholarship, or 
discretionary grant awards have been made or are proposed to be made by 
the entity.

(Authority: 20 U.S.C. 1221e-3 and 3474)

Subpart B [Reserved]



                   Subpart C_How To Apply for a Grant

                         The Application Notice



Sec. 75.100  Publication of an application notice; content of the
notice.

    (a) Each fiscal year the Secretary publishes application notices in 
the Federal Register that explain what kind of assistance is available 
for new grants under the programs that the Secretary administers.
    (b) The application notice for a program explains one or more of the 
following:
    (1) How to apply for a new grant.
    (2) If preapplications are used under the program, how to preapply 
for a new grant.

(Authority: 20 U.S.C. 1221e-3 and 3474)

[45 FR 22497, Apr. 3, 1980. Redesignated at 45 FR 77368, Nov. 21, 1980, 
as amended at 45 FR 86297, Dec. 30, 1980; 51 FR 20824, June 9, 1986; 59 
FR 30261, June 10, 1994]



Sec. 75.101  Information in the application notice that helps an 
applicant apply.

    (a) The Secretary may include such information as the following in 
an application notice:
    (1) How an applicant can get an application package that contains:
    (i) Information about the program; and
    (ii) The application form that the applicant must use.
    (2) The amount of funds available for grants, the estimated number 
of those grants, the estimated amounts of those grants and, if 
appropriate, the maximum award amounts of those grants.
    (3) If the Secretary plans to approve multi-year projects, the 
project period that will be approved.
    (4) Any priorities established by the Secretary for the program for 
that year and the method the Secretary will use to implement the 
priorities. (See Sec. 75.105 Annual priorities.)
    (5) Where to find the regulations that apply to the program.
    (6) The statutory authority for the program.
    (7) The deadlines established under Sec. 75.102 (Deadline date for 
applications.) and 34 CFR 79.8 (How does the Secretary provide States an 
opportunity to comment on proposed Federal financial assistance?)
    (b) If the Secretary either requires or permits preapplications 
under a program, an application notice for the program explains how an 
applicant can get the preapplication form.

(Authority: 20 U.S.C. 1221e-3 and 3474)

    Cross Reference: See 34 CFR 77.1--definitions of ``budget period'' 
and ``project period.''

[45 FR 22497, Apr. 3, 1980. Redesignated at 45 FR 77368, Nov. 21, 1980, 
as amended at 45 FR 84059, Dec. 22, 1980; 46 FR 3205, Jan. 14, 1981; 51 
FR 20824, June 9, 1986; 51 FR 21164, June 11, 1986; 60 FR 63873, Dec. 
12, 1995; 61 FR 8455, Mar. 4, 1996]

[[Page 111]]



Sec. 75.102  Deadline date for applications.

    (a) The application notice for a program sets a deadline date for 
the transmittal of applications to the Department.
    (b) If an applicant wants a new grant, the applicant must submit an 
application in accordance with the requirements in the application 
notice.
    (c) [Reserved]
    (d) If the Secretary allows an applicant to submit a paper 
application, the applicant must show one of the following as proof of 
mailing by the deadline date:
    (1) A legibly dated U.S. Postal Service postmark.
    (2) A legible mail receipt with the date of mailing stamped by the 
U.S. Postal Service.
    (3) A dated shipping label, invoice, or receipt from a commercial 
carrier.
    (4) Any other proof of mailing acceptable to the Secretary.
    (e) If an application is mailed through the U.S. Postal Service, the 
Secretary does not accept either of the following as proof of mailing:
    (1) A private metered postmark.
    (2) A mail receipt that is not dated by the U.S. Postal Service.

(Authority: 20 U.S.C. 1221e-3 and 3474)

    Note: The U.S. Postal Service does not uniformly provide a dated 
postmark. Before relying on this method, an applicant should check with 
its local post office.

[45 FR 22497, Apr. 3, 1980, as amended at 51 FR 20824, June 9, 1986; 69 
FR 41201, July 8, 2004]



Sec. 75.103  Deadline date for preapplications.

    (a) If the Secretary invites or requires preapplications under a 
program, the application notice for the program sets a deadline date for 
preapplications.
    (b) An applicant shall submit its preapplication in accordance with 
the procedures for applications in Sec. 75.102(b) and (d).

(Authority: 20 U.S.C. 1221e-3 and 3474)



Sec. 75.104  Applicants must meet procedural rules.

    (a) The Secretary may make a grant only to an eligible party that 
submits an application.
    (b) If a maximum award amount is established in a notice published 
in the Federal Register, the Secretary may reject without consideration 
or evaluation any application that proposes a project funding level that 
exceeds the stated maximum award amount.

(Authority: 20 U.S.C. 1221e-3 and 3474)

[61 FR 8455, Mar. 4, 1996]



Sec. 75.105  Annual priorities.

    (a) What programs are covered by this section? This section applies 
to any program for which the Secretary establishes priorities for 
selection of applications in a particular fiscal year.
    (b) How does the Secretary establish annual priorities? (1) The 
Secretary establishes final annual priorities by publishing the 
priorities in a notice in the Federal Register, usually in the 
application notice for that program.
    (2) The Secretary publishes proposed annual priorities for public 
comment, unless:
    (i) The final annual priorities will be implemented only by inviting 
applications that meet the priorities (Cross-reference: See 34 CFR 
75.105(c)(1));
    (ii) The final annual priorities are chosen from a list of 
priorities already established in the program's regulations;
    (iii) Publishing proposed annual priorities would seriously 
interfere with an orderly, responsible grant award process or would 
otherwise be impracticable, unnecessary, or contrary to the public 
interest;
    (iv) The program statute requires or authorizes the Secretary to 
establish specified priorities; or
    (v) The annual priorities are chosen from allowable activities 
specified in the program statute.
    (c) How does the Secretary implement an annual priority? The 
Secretary may choose one or more of the following methods to implement 
an annual priority:
    (1) Invitations. The Secretary may simply invite applications that 
meet a priority. If the Secetary chooses this method, an application 
that meets the priority receives no competitive or absolute preference 
over applications that do not meet the priority.

[[Page 112]]

    (2) Competitive preference. The Secretary may give one of the 
following kinds of competitive preference to applications that meet a 
priority.
    (i) The Secretary may award some or all bonus points to an 
application depending on the extent to which the application meets the 
priority. These points are in addition to any points the applicant earns 
under the selection criteria (see Sec. 75.200(b)). The notice states the 
maximum number of additional points that the Secretary may award to an 
application depending upon how well the application meets the priority.
    (ii) The Secretary may select an application that meets a priority 
over an application of comparable merit that does not meet the priority.
    (3) Absolute preference. The Secretary may give an absolute 
preference to applications that meet a priority. The Secretary 
establishes a separate competition for applications that meet the 
priority and reserves all or part of a program's funds solely for that 
competition. The Secretary may adjust the amount reserved for the 
priority after determining the number of high quality applications 
received.

(Authority: 20 U.S.C. 1221e-3 and 3474)

[46 FR 3205, Jan. 14, 1981, as amended at 57 FR 30337, July 8, 1992; 60 
FR 63873, Dec. 12, 1995]

                          Application Contents

    Cross Reference: See Sec. 75.200 for a description of discretionary 
and formula grant programs.



Sec. 75.109  Changes to application; number of copies.

    (a) Each applicant that submits a paper application shall submit an 
original and two copies to the Department, including any information 
that the applicant supplies voluntarily.
    (b) An applicant may make changes to its application on or before 
the deadline date for submitting applications under the program.

(Authority: 20 U.S.C. 1221e-3 and 3474)

    Cross Reference: See Sec. 75.200 How applications for new grants are 
selected for funding.

[45 FR 22497, Apr. 3, 1980. Redesignated at 45 FR 77368, Nov. 21, 1980, 
as amended at 69 FR 41201, July 8, 2004]



Sec. 75.110  Information regarding performance measurement.

    (a) The Secretary may establish in an application notice for a 
competition one or more performance measurement requirements, including 
requirements for performance measures, baseline data, or performance 
targets, and a requirement that applicants propose in their applications 
one or more of their own performance measures, baseline data, or 
performance targets.
    (b) If an application notice requires applicants to propose project-
specific performance measures, baseline data, or performance targets, 
the application must include the following, as required by the 
application notice:
    (1) Performance measures. How each proposed performance measure 
would accurately measure the performance of the project and how the 
proposed performance measure would be consistent with the performance 
measures established for the program funding the competition.
    (2) Baseline data. (i) Why each proposed baseline is valid; or
    (ii) If the applicant has determined that there are no established 
baseline data for a particular performance measure, an explanation of 
why there is no established baseline and of how and when, during the 
project period, the applicant would establish a valid baseline for the 
performance measure.
    (3) Performance targets. Why each proposed performance target is 
ambitious yet achievable compared to the baseline for the performance 
measure and when, during the project period, the applicant would meet 
the performance target(s).
    (c) If the application notice establishes performance measurement 
requirements, the applicant must also describe in the application--
    (1)(i) The data collection and reporting methods the applicant would 
use and why those methods are likely to yield reliable, valid, and 
meaningful performance data; and
    (ii) If the Secretary requires applicants to collect data after the 
substantive work of a project is complete regarding the attainment of 
certain

[[Page 113]]

performance targets, the data collection and reporting methods the 
applicant would use during the post-performance period and why those 
methods are likely to yield reliable, valid, and meaningful performance 
data.
    (2) The applicant's capacity to collect and report reliable, valid, 
and meaningful performance data, as evidenced by high-quality data 
collection, analysis, and reporting in other projects or research.

(Authority: 20 U.S.C. 1221e-3 and 3474)

[78 FR 49352, Aug. 13, 2013]



Sec. 75.112  Include a proposed project period and a timeline.

    (a) An application must propose a project period for the project.
    (b) An application must include a narrative that describes how and 
when, in each budget period of the project, the applicant plans to meet 
each objective of the project.

(Approved by the Office of Management and Budget under control number 
1875-0102)

(Authority: 20 U.S.C. 1221e-3 and 3474)

[45 FR 22497, Apr. 3, 1980. Redesignated at 45 FR 77368, Nov. 21, 1980, 
as amended at 59 FR 30261, June 10, 1994]



Sec. 75.117  Information needed for a multi-year project.

    An applicant that proposes a multi-year project shall include in its 
application:
    (a) Information that shows why a multi-year project is needed;
    (b) A budget narrative accompanied by a budget form prescribed by 
the Secretary, that provides budget information for each budget period 
of the proposed project period.

(Approved by the Office of Management and Budget under control number 
1875-0102)

(Authority: 20 U.S.C. 1221e-3 and 3474)

[45 FR 22497, Apr. 3, 1980. Redesignated at 45 FR 77368, Nov. 21, 1980, 
as amended at 59 FR 30261, June 10, 1994]



Sec. 75.118  Requirements for a continuation award.

    (a) A recipient that wants to receive a continuation award shall 
submit a performance report that provides the most current performance 
and financial expenditure information, as directed by the Secretary, 
that is sufficient to meet the reporting requirements of 2 CFR 200.327 
and 200.328 and 34 CFR 75.590 and 75.720.
    (b) If a recipient fails to submit a performance report that meets 
the requirements of paragraph (a) of this section, the Secretary denies 
continued funding for the grant.

(Approved by the Office of Management and Budget under control number 
1875-0102)

(Authority: 20 U.S.C. 1221e-3(a)(1) and 3474)

    Cross Reference:  See 2 CFR 200.327, Financial reporting, and 
200.328, Monitoring and reporting program performance; and 34 CFR 
75.117, Information needed for a multi-year project, 75.250 through 
75.253, Approval of multi-year projects, 75.590, Evaluation by the 
grantee, and 75.720, Financial and performance reports.

[59 FR 30261, June 10, 1994, as amended at 64 FR 50391, Sept. 16, 1999; 
79 FR 76091, Dec. 19, 2014]



Sec. 75.119  Information needed if private school students
participate.

    If a program requires the applicant to provide an opportunity for 
participation of students enrolled in private schools, the application 
must include the information required of subgrantees under 34 CFR 
76.656.

(Approved by the Office of Management and Budget under control number 
1880-0513)

(Authority: 20 U.S.C. 1221e-3 and 3474)

[45 FR 22497, Apr. 3, 1980. Redesignated at 45 FR 77368, Nov. 21, 1980, 
as amended at 53 FR 49143, Dec. 6, 1988]

               Separate Applications--Alternative Programs



Sec. 75.125  Submit a separate application to each program.

    An applicant shall submit a separate application to each program 
under which it wants a grant.

(Authority: 20 U.S.C. 1221e-3 and 3474)

[45 FR 22497, Apr. 3, 1980. Redesignated at 45 FR 77368, Nov. 21, 1980, 
as amended at 52 FR 27803, July 24, 1987; 60 FR 46493, Sept. 6, 1995]



Sec. 75.126  Application must list all programs to which it is
submitted.

    If an applicant is submitting an application for the same project 
under more than one Federal program, the applicant shall list these 
programs in

[[Page 114]]

its application. The Secretary uses this information to avoid duplicate 
grants for the same project.

(Authority: 20 U.S.C. 1221e-3 and 3474)

                           Group Applications



Sec. 75.127  Eligible parties may apply as a group.

    (a) Eligible parties may apply as a group for a grant.
    (b) Depending on the program under which a group of eligible parties 
seeks assistance, the term used to refer to the group may vary. The list 
that follows contains some of the terms used to identify a group of 
eligible parties:
    (1) Combination of institutions of higher education.
    (2) Consortium.
    (3) Joint applicants.
    (4) Cooperative arrangements.

(Authority: 20 U.S.C. 1221e-3 and 3474)



Sec. 75.128  Who acts as applicant; the group agreement.

    (a) If a group of eligible parties applies for a grant, the members 
of the group shall either:
    (1) Designate one member of the group to apply for the grant; or
    (2) Establish a separate, eligible legal entity to apply for the 
grant.
    (b) The members of the group shall enter into an agreement that:
    (1) Details the activities that each member of the group plans to 
perform; and
    (2) Binds each member of the group to every statement and assurance 
made by the applicant in the application.
    (c) The applicant shall submit the agreement with its application.

(Authority: 20 U.S.C. 1221e-3 and 3474)



Sec. 75.129  Legal responsibilities of each member of the group.

    (a) If the Secretary makes a grant to a group of eligible 
applicants, the applicant for the group is the grantee and is legally 
responsible for:
    (1) The use of all grant funds;
    (2) Ensuring that the project is carried out by the group in 
accordance with Federal requirements; and
    (3) Ensuring that indirect cost funds are determined as required 
under Sec. 75.564(e).
    (b) Each member of the group is legally responsible to:
    (1) Carry out the activities it agrees to perform; and
    (2) Use the funds that it receives under the agreement in accordance 
with Federal requirements that apply to the grant.

(Authority: 20 U.S.C. 1221e-3 and 3474)

[45 FR 22497, Apr. 3, 1980. Redesignated at 45 FR 77368, Nov. 21, 1980, 
as amended at 59 FR 59581, Nov. 17, 1994]

                         Competition Exceptions



Sec. 75.135  Competition exception for proposed implementation sites,
implementation partners, or service providers.

    (a) When entering into a contract with implementation sites or 
partners, an applicant is not required to comply with the competition 
requirements in 2 CFR 200.320(c) and (d), if--
    (1) The contract is with an entity that agrees to provide a site or 
sites where the applicant would conduct the project activities under the 
grant;
    (2) The implementation sites or partner entities that the applicant 
proposes to use are identified in the application for the grant; and
    (3) The implementation sites or partner entities are included in the 
application in order to meet a regulatory, statutory, or priority 
requirement related to the competition.
    (b) When entering into a contract for data collection, data 
analysis, evaluation services, or essential services, an applicant may 
select a provider using the informal, small-purchase procurement 
procedures in 2 CFR 200.320(b), regardless of whether that applicant 
would otherwise be subject to that part or whether the evaluation 
contract would meet the standards for a small purchase order, if--
    (1) The contract is with the data collection, data analysis, 
evaluation service, or essential service provider;
    (2) The data collection, data analysis, evaluation service, or 
essential service provider that the applicant proposes to use is 
identified in the application for the grant; and
    (3) The data collection, data analysis, evaluation service, or 
essential service provider is identified in the application

[[Page 115]]

in order to meet a statutory, regulatory, or priority requirement 
related to the competition.
    (c) If the grantee relied on the exceptions under paragraph (a) or 
(b) of this section, the grantee must certify in its application that 
any employee, officer, or agent participating in the selection, award, 
or administration of a contract is free of any real or apparent conflict 
of interest and, if the grantee relied on the exceptions of paragraph 
(b) of this section, that the grantee used small purchase procedures to 
obtain the product or service.
    (d) A grantee must obtain the Secretary's prior approval for any 
change to an implementation site, implementation partner, or data 
collection, data analysis, evaluation service, or essential service 
provider, if the grantee relied on the exceptions under paragraph (a) or 
(b) of this section to select the entity.
    (e) The exceptions in paragraphs (a) and (b) of this section do not 
extend to the other procurement requirements in 2 CFR part 200 regarding 
contracting by grantees and subgrantees.
    (f) For the purposes of this section, essential service means a 
product or service directly related to the grant that would, if not 
provided, have a detrimental effect on the grant.

(Authority: 20 U.S.C. 1221e-3 and 3474)

[78 FR 49352, Aug. 13, 2013, as amended at 79 FR 76091, Dec. 19, 2014; 
80 FR 67264, Nov. 2, 2015]

                        State Comment Procedures



Sec. 75.155  Review procedures if State may comment on applications:
Purpose of Secs. 75.156-75.158.

    If the authorizing statute for a program requires that a specific 
State agency be given an opportunity to comment on each application, the 
State and the applicant shall use the procedures in Secs. 75.156-75.158 
for that purpose.

(Authority: 20 U.S.C. 1221e-3 and 3474)

    Cross Reference: See 34 CFR part 79 (Intergovernmental Review of 
Department of Education Programs and Activities) for the regulations 
implementing the application review procedures that States may use under 
E.O. 12372.

[57 FR 30338, July 8, 1992]



Sec. 75.156  When an applicant under Sec. 75.155 must submit its 
application to the State; proof of submission.

    (a) Each applicant under a program covered by Sec. 75.155 shall 
submit a copy of its application to the State on or before the deadline 
date for submitting its application to the Department.
    (b) The applicant shall attach to its application a copy of its 
letter that requests the State to comment on the application.

(Authority: 20 U.S.C. 1221e-3 and 3474)



Sec. 75.157  The State reviews each application.

    A State that receives an application under Sec. 75.156 may review 
and comment on the application.

(Authority: 20 U.S.C. 1221e-3(a)(1) and 3474)



Sec. 75.158  Deadlines for State comments.

    (a) The Secretary may establish a deadline date for receipt of State 
comments on applications.
    (b) The State shall make its comments in a written statement signed 
by an appropriate State official.
    (c) The appropriate State official shall submit comments to the 
Secretary by the deadline date for State comments. The procedures in 
Sec. 75.102 (b) and (d) (how to meet a deadline) of this part apply to 
this submission.

(Authority: 20 U.S.C. 1221e-3 and 3474)



Sec. 75.159  Effect of State comments or failure to comment.

    (a) The Secretary considers those comments of the State that relate 
to:
    (1) Any selection criterion that applies under the program; or
    (2) Any other matter that affects the selection of projects for 
funding under the program.
    (b) If the State fails to comment on an application on or before the 
deadline date for the appropriate program, the State waives its right to 
comment.
    (c) If the applicant does not give the State an opportunity to 
comment, the

[[Page 116]]

Secretary does not select that project for a grant.

(Authority: 20 U.S.C. 1221e-3 and 3474)

           Development of Curricula or Instructional Materials



Sec. 75.190  Consultation.

    Each applicant that intends to develop curricula or instructional 
materials under a grant is encouraged to assure that the curricula or 
materials will be developed in a manner conducive to dissemination, 
through continuing consultations with publishers, personnel of State and 
local educational agencies, teachers, administrators, community 
representatives, and other individuals experienced in dissemination.

(Authority: 20 U.S.C. 1221e-3 and 3474)



Sec. 75.191  Consultation costs.

    An applicant may budget reasonable consultation fees or planning 
costs in connection with the development of curricula or instructional 
materials.

(Authority: 20 U.S.C. 1221e-3 and 3474)



Sec. 75.192  Dissemination.

    If an applicant proposes to publish and disseminate curricula or 
instructional materials under a grant, the applicant shall include an 
assurance in its application that the curricula or materials will reach 
the populations for which the curricula or materials were developed.

(Authority: 20 U.S.C. 1221e-3 and 3474)



                      Subpart D_How Grants Are Made

                        Selection of New Projects



Sec. 75.200  How applications for new grants and cooperative 
agreements are selected for funding; standards for use of cooperative
agreements.

    (a) Direct grant programs. The Department administers two kinds of 
direct grant programs. A direct grant program is either a discretionary 
grant or a formula grant program.
    (b) Discretionary grant programs. (1) A discretionary grant program 
is one that permits the Secretary to use discretionary judgment in 
selecting applications for funding.

    Cross Reference: See Sec. 75.219 Exceptions to the procedures under 
Sec. 75.217.

    (2) The Secretary uses selection criteria to evaluate the 
applications submitted for new grants under a discretionary grant 
program.
    (3) To evaluate the applications for new grants under the program 
the Secretary may use:
    (i) Selection criteria established under Sec. 75.209.
    (ii) Selection criteria in program-specific regulations.
    (iii) Selection criteria established under Sec. 75.210.
    (iv) Any combination of criteria from paragraphs (b)(3)(i), 
(b)(3)(ii), and (b)(3)(iii) of this section.
    (4) The Secretary may award a cooperative agreement instead of a 
grant if the Secretary determines that substantial involvement between 
the Department and the recipient is necessary to carry out a 
collaborative project.
    (5) The Secretary uses the selection procedures in this subpart to 
select recipients of cooperative agreements.
    (c) Formula grant programs. (1) A formula grant program is one that 
entitles certain applicants to receive grants if they meet the 
requirements of the program. Applicants do not compete with each other 
for the funds, and each grant is either for a set amount or for an 
amount determined under a formula.
    (2) The Secretary applies the program statute and regulations to 
fund projects under a formula grant program.

(Authority: 20 U.S.C. 1221e-3 and 3474)

[45 FR 22497, Apr. 3, 1980. Redesignated at 45 FR 77368, Nov. 21, 1980, 
as amended at 52 FR 27803, July 24, 1987; 57 FR 30338, July 8, 1992; 60 
FR 63873, Dec. 12, 1995; 62 FR 10401, Mar. 6, 1997]



Sec. 75.201  How the selection criteria will be used.

    (a) In the application package or a notice published in the Federal 
Register, the Secretary informs applicants of--
    (1) The selection criteria chosen; and
    (2) The factors selected for considering the selection criteria, if 
any.
    (b) If points or weights are assigned to the selection criteria, the 
Secretary informs applicants in the application

[[Page 117]]

package or a notice published in the Federal Register of--
    (1) The total possible score for all of the criteria for a program; 
and
    (2) The assigned weight or the maximum possible score for each 
criterion or factor under that criterion.
    (c) If no points or weights are assigned to the selection criteria 
and selected factors, the Secretary evaluates each criterion equally 
and, within each criterion, each factor equally.

(Authority: 20 U.S.C. 1221e-3 and 3474)

[62 FR 10401, Mar. 6, 1997]



Secs. 75.202-75.206  [Reserved]



Sec. 75.209  Selection criteria based on statutory or regulatory 
provisions.

    The Secretary may establish selection criteria and factors based on 
statutory or regulatory provisions that apply to the authorized program, 
which may include, but are not limited to criteria and factors that 
reflect--
    (a) Criteria contained in the program statute or regulations;
    (b) Criteria in Sec. 75.210;
    (c) Allowable activities specified in the program statute or 
regulations;
    (d) Application content requirements specified in the program 
statute or regulations;
    (e) Program purposes, as described in the program statute or 
regulations; or
    (f) Other pre-award and post-award conditions specified in the 
program statute or regulations.

(Authority: 20 U.S.C. 1221e-3 and 3474)

[78 FR 49353, Aug. 13, 2013]



Sec. 75.210  General selection criteria.

    In determining the selection criteria to evaluate applications 
submitted in a grant competition, the Secretary may select one or more 
of the following criteria and may select from among the list of optional 
factors under each criterion. The Secretary may define a selection 
criterion by selecting one or more specific factors within a criterion 
or assigning factors from one criterion to another criterion.
    (a) Need for project. (1) The Secretary considers the need for the 
proposed project.
    (2) In determining the need for the proposed project, the Secretary 
considers one or more of the following factors:
    (i) The magnitude or severity of the problem to be addressed by the 
proposed project.
    (ii) The magnitude of the need for the services to be provided or 
the activities to be carried out by the proposed project.
    (iii) The extent to which the proposed project will provide services 
or otherwise address the needs of students at risk of educational 
failure.
    (iv) The extent to which the proposed project will focus on serving 
or otherwise addressing the needs of disadvantaged individuals.
    (v) 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.
    (vi) The extent to which the proposed project will prepare personnel 
for fields in which shortages have been demonstrated.
    (b) Significance. (1) The Secretary considers the significance of 
the proposed project.
    (2) In determining the significance of the proposed project, the 
Secretary considers one or more of the following factors:
    (i) The national significance of the proposed project.
    (ii) The significance of the problem or issue to be addressed by the 
proposed project.
    (iii) The potential contribution of the proposed project to 
increased knowledge or understanding of educational problems, issues, or 
effective strategies.
    (iv) The potential contribution of the proposed project to increased 
knowledge or understanding of rehabilitation problems, issues, or 
effective strategies.
    (v) The likelihood that the proposed project will result in system 
change or improvement.
    (vi) The potential contribution of the proposed project to the 
development and advancement of theory, knowledge, and practices in the 
field of study.
    (vii) The potential for generalizing from the findings or results of 
the proposed project.

[[Page 118]]

    (viii) The extent to which the proposed project is likely to yield 
findings that may be utilized by other appropriate agencies and 
organizations.
    (ix) The extent to which the proposed project is likely to build 
local capacity to provide, improve, or expand services that address the 
needs of the target population.
    (x) The extent to which the proposed project involves the 
development or demonstration of promising new strategies that build on, 
or are alternatives to, existing strategies.
    (xi) The likely utility of the products (such as information, 
materials, processes, or techniques) that will result from the proposed 
project, including the potential for their being used effectively in a 
variety of other settings.
    (xii) The extent to which the results of the proposed project are to 
be disseminated in ways that will enable others to use the information 
or strategies.
    (xiii) The potential replicability of the proposed project or 
strategies, including, as appropriate, the potential for implementation 
in a variety of settings.
    (xiv) The importance or magnitude of the results or outcomes likely 
to be attained by the proposed project, especially improvements in 
teaching and student achievement.
    (xv) The importance or magnitude of the results or outcomes likely 
to be attained by the proposed project, especially improvements in 
employment, independent living services, or both, as appropriate.
    (xvi) The importance or magnitude of the results or outcomes likely 
to be attained by the proposed project.
    (c) Quality of the project design. (1) The Secretary considers the 
quality of the design of the proposed project.
    (2) In determining the quality of the design of the proposed 
project, the Secretary considers one or more of the following factors:
    (i) The extent to which the goals, objectives, and outcomes to be 
achieved by the proposed project are clearly specified and measurable.
    (ii) The extent to which the design of the proposed project is 
appropriate to, and will successfully address, the needs of the target 
population or other identified needs.
    (iii) The extent to which there is a conceptual framework underlying 
the proposed research or demonstration activities and the quality of 
that framework.
    (iv) The extent to which the proposed activities constitute a 
coherent, sustained program of research and development in the field, 
including, as appropriate, a substantial addition to an ongoing line of 
inquiry.
    (v) The extent to which the proposed activities constitute a 
coherent, sustained program of training in the field.
    (vi) The extent to which the proposed project is based upon a 
specific research design, and the quality and appropriateness of that 
design, including the scientific rigor of the studies involved.
    (vii) The extent to which the proposed research design includes a 
thorough, high-quality review of the relevant literature, a high-quality 
plan for research activities, and the use of appropriate theoretical and 
methodological tools, including those of a variety of disciplines, if 
appropriate.
    (viii) The extent to which the design of the proposed project 
includes a thorough, high-quality review of the relevant literature, a 
high-quality plan for project implementation, and the use of appropriate 
methodological tools to ensure successful achievement of project 
objectives.
    (ix) The quality of the proposed demonstration design and procedures 
for documenting project activities and results.
    (x) The extent to which the design for implementing and evaluating 
the proposed project will result in information to guide possible 
replication of project activities or strategies, including information 
about the effectiveness of the approach or strategies employed by the 
project.
    (xi) The extent to which the proposed development efforts include 
adequate quality controls and, as appropriate, repeated testing of 
products.
    (xii) The extent to which the proposed project is designed to build 
capacity and yield results that will extend beyond the period of Federal 
financial assistance.

[[Page 119]]

    (xiii) The extent to which the design of the proposed project 
reflects up-to-date knowledge from research and effective practice.
    (xiv) The extent to which the proposed project represents an 
exceptional approach for meeting statutory purposes and requirements.
    (xv) The extent to which the proposed project represents an 
exceptional approach to the priority or priorities established for the 
competition.
    (xvi) The extent to which the proposed project will integrate with 
or build on similar or related efforts to improve relevant outcomes (as 
defined in 34 CFR 77.1(c)), using existing funding streams from other 
programs or policies supported by community, State, and Federal 
resources.
    (xvii) The extent to which the proposed project will establish 
linkages with other appropriate agencies and organizations providing 
services to the target population.
    (xviii) The extent to which the proposed project is part of a 
comprehensive effort to improve teaching and learning and support 
rigorous academic standards for students.
    (xix) The extent to which the proposed project encourages parental 
involvement.
    (xx) The extent to which the proposed project encourages consumer 
involvement.
    (xxi) The extent to which performance feedback and continuous 
improvement are integral to the design of the proposed project.
    (xxii) The quality of the methodology to be employed in the proposed 
project.
    (xxiii) The extent to which fellowship recipients or other project 
participants are to be selected on the basis of academic excellence.
    (xxiv) The extent to which the applicant demonstrates that it has 
the resources to operate the project beyond the length of the grant, 
including a multi-year financial and operating model and accompanying 
plan; the demonstrated commitment of any partners; evidence of broad 
support from stakeholders (e.g., State educational agencies, teachers' 
unions) critical to the project's long-term success; or more than one of 
these types of evidence.
    (xxv) The potential and planning for the incorporation of project 
purposes, activities, or benefits into the ongoing work of the applicant 
beyond the end of the grant.
    (xxvi) The extent to which the proposed project will increase 
efficiency in the use of time, staff, money, or other resources in order 
to improve results and increase productivity.
    (xxvii) The extent to which the proposed project will integrate with 
or build on similar or related efforts in order to improve relevant 
outcomes (as defined in 34 CFR 77.1(c)), using nonpublic funds or 
resources.
    (xxviii) The extent to which the proposed project is supported by 
evidence of promise (as defined in 34 CFR 77.1(c)).
    (xxix) The extent to which the proposed project is supported by 
strong theory (as defined in 34 CFR 77.1(c)).
    (d) Quality of project services. (1) The Secretary considers the 
quality of the services to be provided by the proposed project.
    (2) In determining the quality of the services to be provided by the 
proposed project, the Secretary considers the quality and sufficiency of 
strategies for ensuring equal access and treatment for eligible project 
participants 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 factors:
    (i) The extent to which the services to be provided by the proposed 
project are appropriate to the needs of the intended recipients or 
beneficiaries of those services.
    (ii) The extent to which entities that are to be served by the 
proposed technical assistance project demonstrate support for the 
project.
    (iii) The extent to which the services to be provided by the 
proposed project reflect up-to-date knowledge from research and 
effective practice.
    (iv) The likely impact of the services to be provided by the 
proposed project on the intended recipients of those services.
    (v) The extent to which the training or professional development 
services to

[[Page 120]]

be provided by the proposed project are of sufficient quality, 
intensity, and duration to lead to improvements in practice among the 
recipients of those services.
    (vi) The extent to which the training or professional development 
services to be provided by the proposed project are likely to alleviate 
the personnel shortages that have been identified or are the focus of 
the proposed project.
    (vii) The likelihood that the services to be provided by the 
proposed project will lead to improvements in the achievement of 
students as measured against rigorous academic standards.
    (viii) The likelihood that the services to be provided by the 
proposed project will lead to improvements in the skills necessary to 
gain employment or build capacity for independent living.
    (ix) The extent to which the services to be provided by the proposed 
project involve the collaboration of appropriate partners for maximizing 
the effectiveness of project services.
    (x) The extent to which the technical assistance services to be 
provided by the proposed project involve the use of efficient 
strategies, including the use of technology, as appropriate, and the 
leveraging of non-project resources.
    (xi) The extent to which the services to be provided by the proposed 
project are focused on those with greatest needs.
    (xii) The quality of plans for providing an opportunity for 
participation in the proposed project of students enrolled in private 
schools.
    (e) Quality of project personnel. (1) The Secretary considers the 
quality of the personnel who will carry out the proposed project.
    (2) In determining the quality of project personnel, 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 factors:
    (i) The qualifications, including relevant training and experience, 
of the project director or principal investigator.
    (ii) The qualifications, including relevant training and experience, 
of key project personnel.
    (iii) The qualifications, including relevant training and 
experience, of project consultants or subcontractors.
    (f) Adequacy of resources. (1) The Secretary considers the adequacy 
of resources for the proposed project.
    (2) In determining the adequacy of resources for the proposed 
project, the Secretary considers one or more of the following factors:
    (i) The adequacy of support, including facilities, equipment, 
supplies, and other resources, from the applicant organization or the 
lead applicant organization.
    (ii) The relevance and demonstrated commitment of each partner in 
the proposed project to the implementation and success of the project.
    (iii) The extent to which the budget is adequate to support the 
proposed project.
    (iv) The extent to which the costs are reasonable in relation to the 
objectives, design, and potential significance of the proposed project.
    (v) The extent to which the costs are reasonable in relation to the 
number of persons to be served and to the anticipated results and 
benefits.
    (vi) The potential for continued support of the project after 
Federal funding ends, including, as appropriate, the demonstrated 
commitment of appropriate entities to such support.
    (vii) The potential for the incorporation of project purposes, 
activities, or benefits into the ongoing program of the agency or 
organization at the end of Federal funding.
    (g) Quality of the management plan. (1) The Secretary considers the 
quality of the management plan for the proposed project.
    (2) In determining the quality of the management plan for the 
proposed project, the Secretary considers one or more of the following 
factors:
    (i) The adequacy of the management plan to achieve the objectives of 
the proposed project on time and within budget, including clearly 
defined responsibilities, timelines, and milestones for accomplishing 
project tasks.

[[Page 121]]

    (ii) The adequacy of procedures for ensuring feedback and continuous 
improvement in the operation of the proposed project.
    (iii) The adequacy of mechanisms for ensuring high-quality products 
and services from the proposed project.
    (iv) The extent to which the time commitments of the project 
director and principal investigator and other key project personnel are 
appropriate and adequate to meet the objectives of the proposed project.
    (v) How the applicant will ensure that a diversity of perspectives 
are brought to bear in the operation of the proposed project, including 
those of parents, teachers, the business community, a variety of 
disciplinary and professional fields, recipients or beneficiaries of 
services, or others, as appropriate.
    (h) Quality of the project evaluation. (1) The Secretary considers 
the quality of the evaluation to be conducted of the proposed project.
    (2) In determining the quality of the evaluation, the Secretary 
considers one or more of the following factors:
    (i) The extent to which the methods of evaluation are thorough, 
feasible, and appropriate to the goals, objectives, and outcomes of the 
proposed project.
    (ii) The extent to which the methods of evaluation are appropriate 
to the context within which the project operates.
    (iii) The extent to which the methods of evaluation provide for 
examining the effectiveness of project implementation strategies.
    (iv) The extent to which the methods of evaluation include the use 
of objective performance measures that are clearly related to the 
intended outcomes of the project and will produce quantitative and 
qualitative data to the extent possible.
    (v) The extent to which the methods of evaluation will provide 
timely guidance for quality assurance.
    (vi) The extent to which the methods of evaluation will provide 
performance feedback and permit periodic assessment of progress toward 
achieving intended outcomes.
    (vii) The extent to which the evaluation will provide guidance about 
effective strategies suitable for replication or testing in other 
settings.
    (viii) The extent to which the methods of evaluation will, if well-
implemented, produce evidence about the project's effectiveness that 
would meet the What Works Clearinghouse Evidence Standards without 
reservations.
    (ix) The extent to which the methods of evaluation will, if well-
implemented, produce evidence about the project's effectiveness that 
would meet the What Works Clearinghouse Evidence Standards with 
reservations.
    (x) The extent to which the methods of evaluation will, if well-
implemented, produce evidence of promise (as defined in 34 CFR 77.1(c)).
    (xi) The extent to which the methods of evaluation will provide 
valid and reliable performance data on relevant outcomes.
    (xii) The extent to which the evaluation plan clearly articulates 
the key components, mediators, and outcomes of the grant-supported 
intervention, as well as a measurable threshold for acceptable 
implementation.
    (i) Strategy to scale. (1) The Secretary considers the applicant's 
strategy to scale the proposed project.
    (2) In determining the applicant's capacity to scale the proposed 
project, the Secretary considers one or more of the following factors:
    (i) The applicant's capacity (e.g., in terms of qualified personnel, 
financial resources, or management capacity) to bring the proposed 
project to scale on a national or regional level (as defined in 34 CFR 
77.1(c)) working directly, or through partners, during the grant period.
    (ii) The applicant's capacity (e.g., in terms of qualified 
personnel, financial resources, or management capacity) to further 
develop and bring to scale the proposed process, product, strategy, or 
practice, or to work with others to ensure that the proposed process, 
product, strategy, or practice can be further developed and brought to 
scale, based on the findings of the proposed project.
    (iii) The feasibility of successful replication of the proposed 
project, if favorable results are obtained, in a variety of settings and 
with a variety of populations.

[[Page 122]]

    (iv) The mechanisms the applicant will use to broadly disseminate 
information on its project so as to support further development or 
replication.
    (v) The extent to which the applicant demonstrates there is unmet 
demand for the process, product, strategy, or practice that will enable 
the applicant to reach the level of scale that is proposed in the 
application.
    (vi) The extent to which the applicant identifies a specific 
strategy or strategies that address a particular barrier or barriers 
that prevented the applicant, in the past, from reaching the level of 
scale that is proposed in the application.

(Approved by the Office of Management and Budget under control number 
1875-0102)

(Authority: 20 U.S.C. 1221e-3 and 3474)

[62 FR 10401, Mar. 6, 1997, as amended at 78 FR 49353, Aug. 13, 2013; 80 
FR 2608, Jan. 20, 2015]



Sec. 75.211  Selection criteria for unsolicited applications.

    (a) If the Secretary considers an unsolicited application under 34 
CFR 75.222(a)(2)(ii), the Secretary uses the selection criteria and 
factors, if any, used for the competition under which the application 
could have been funded.
    (b) If the Secretary considers an unsolicited application under 34 
CFR 75.222(a)(2)(iii), the Secretary selects from among the criteria in 
Sec. 75.210(b), and may select from among the specific factors listed 
under each criterion, the criteria that are most appropriate to evaluate 
the activities proposed in the application.

(Authority: 20 U.S.C. 1221e-3 and 3474)

[62 FR 10403, Mar. 6, 1997]

                          Selection Procedures



Sec. 75.215  How the Department selects a new project: purpose of
Secs. 75.216-75.222.

    Sections 75.216-75.222 describe the process the Secretary uses to 
select applications for new grants. All of these sections apply to a 
discretionary grant program. However, only Sec. 75.216 applies also to a 
formula grant program.

    Cross Reference: See Sec. 75.200(b) Discretionary grant program, and 
(c) Formula grant program.

(Authority: 20 U.S.C. 1221e-3 and 3474)



Sec. 75.216  Applications not evaluated for funding.

    The Secretary does not evaluate an application if--
    (a) The applicant is not eligible;
    (b) The applicant does not comply with all of the procedural rules 
that govern the submission of the application;
    (c) The application does not contain the information required under 
the program; or
    (d) The proposed project cannot be funded under the authorizing 
statute or implementing regulations for the program.

(Authority: 20 U.S.C. 1221e-3 and 3474)

[57 FR 30338, July 8, 1992]



Sec. 75.217  How the Secretary selects applications for new grants.

    (a) The Secretary selects applications for new grants on the basis 
of the authorizing statute, the selection criteria, and any priorities 
or other requirements that have been published in the Federal Register 
and apply to the selection of those applications.
    (b)(1) The Secretary may use experts to evaluate the applications 
submitted under a program.
    (2) These experts may include persons who are not employees of the 
Federal Government.
    (c) The Secretary prepares a rank order of the applications based 
solely on the evaluation of their quality according to the selection 
criteria.
    (d) The Secretary then determines the order in which applications 
will be selected for grants. The Secretary considers the following in 
making these determinations:
    (1) The information in each application.
    (2) The rank ordering of the applications.
    (3) Any other information--
    (i) Relevant to a criterion, priority, or other requirement that 
applies to the selection of applications for new grants;

[[Page 123]]

    (ii) Concerning the applicant's performance and use of funds under a 
previous award under any Department program; and
    (iii) Concerning the applicant's failure under any Department 
program to submit a performance report or its submission of a 
performance report of unacceptable quality.

(Authority: 20 U.S.C. 1221e-3 and 3474)

[52 FR 27804, July 24, 1987, as amended at 62 FR 4167, Jan. 29, 1997]



Sec. 75.218  Applications not evaluated or selected for funding.

    (a) The Secretary informs an applicant if its application--
    (1) Is not evaluated; or
    (2) Is not selected for funding.
    (b) If an applicant requests an explanation of the reason its 
application was not evaluated or selected, the Secretary provides that 
explanation.

(Authority: 20 U.S.C. 1221e-3 and 3474)

[57 FR 30338, July 8, 1992]



Sec. 75.219  Exceptions to the procedures under Sec. 75.217.

    The Secretary may select an application for funding without 
following the procedures in Sec. 75.217 if:
    (a) The objectives of the project cannot be achieved unless the 
Secretary makes the grant before the date grants can be made under the 
procedures in Sec. 75.217;
    (b)(1) The application was evaluated under the preceding competition 
of the program;
    (2) The application rated high enough to deserve selection under 
Sec. 75.217; and
    (3) The application was not selected for funding because the 
application was mishandled by the Department; or
    (c) The Secretary receives an unsolicited application that meets the 
requirements of Sec. 75.222.

(Authority: 20 U.S.C. 1221e-3 and 3474)

[45 FR 22497, Apr. 3, 1980. Redesignated at 45 FR 77368, Nov. 21, 1980, 
as amended at 52 FR 27804, July 24, 1987; 60 FR 12096, Mar. 3, 1995]



Sec. 75.220  Procedures the Department uses under Sec. 75.219(a).

    If the special circumstances of Sec. 75.219(a) appear to exist for 
an application, the Secretary uses the following procedures:
    (a) The Secretary assembles a board to review the application.
    (b) The board consists of:
    (1) A program officer of the program under which the applicant wants 
a grant;
    (2) An employee from the Office of the Chief Financial Officer 
(OCFO) with responsibility for grant policy; and
    (3) A Department employee who is not a program officer of the 
program but who is qualified to evaluate the application.
    (c) The board reviews the application to decide if:
    (1) The special circumstances under Sec. 75.219(a) are satisfied;
    (2) The application rates high enough, based on the selection 
criteria, priorities, and other requirements that apply to the program, 
to deserve selection; and
    (3) Selection of the application will not have an adverse impact on 
the budget of the program.
    (d) The board forwards the results of its review to the Secretary.
    (e) If each of the conditions in paragraph (c) of this section is 
satisfied, the Secretary may select the application for funding.
    (f) Even if the Secretary does not select the application for 
funding, the applicant may submit its application under the procedures 
in Subpart C of this part.

(Authority: 20 U.S.C. 1221e-3 and 3474)

[45 FR 22497, Apr. 3, 1980. Redesignated at 45 FR 77368, Nov. 21, 1980, 
as amended at 45 FR 86297, Dec. 30, 1980; 64 FR 50391, Sept. 16, 1999]



Sec. 75.221  Procedures the Department uses under Sec. 75.219(b).

    If the special circumstances of Sec. 75.219(b) appear to exist for 
an application, the Secretary may select the application for funding if:
    (a) The Secretary has documentary evidence that the special 
circumstances of Sec. 75.219(b) exist; and

[[Page 124]]

    (b) The Secretary has a statement that explains the circumstances of 
the mishandling.

(Authority: 20 U.S.C. 1221e-3(a)(1) and 3474)

[45 FR 22497, Apr. 3, 1980. Redesignated at 45 FR 77368, Nov. 21, 1980, 
as amended at 52 FR 27804, July 24, 1987. Redesignated at 60 FR 12096, 
Mar. 3, 1995]



Sec. 75.222  Procedures the Department uses under Sec. 75.219(c).

    If the Secretary receives an unsolicited application, the Secretary 
may consider the application under the following procedures unless the 
Secretary has published a notice in the Federal Register stating that 
the program that would fund the application would not consider 
unsolicited applications:
    (a)(1) The Secretary determines whether the application could be 
funded under a competition planned or conducted for the fiscal year 
under which funds would be used to fund the application.
    (2)(i) If the application could be funded under a competition 
described in paragraph (a)(1) of this section and the deadline for 
submission of applications has not passed, the Secretary refers the 
application to the appropriate competition for consideration under the 
procedures in Sec. 75.217.
    (ii)(A) If the application could have been funded under a 
competition described in paragraph (a)(1) of this section and the 
deadline for submission of applications has passed, the Secretary may 
consider the application only in exceptional circumstances, as 
determined by the Secretary.
    (B) If the Secretary considers an application under paragraph 
(a)(2)(ii) of this section, the Secretary considers the application 
under paragraphs (b) through (e) of this section.
    (iii) If the application could not be funded under a competition 
described in paragraph (a)(1) of this section, the Secretary considers 
the application under paragraphs (b) through (e) of this section.
    (b) If an application may be considered under paragraphs (a)(2)(ii) 
or (iii) of this section, the Secretary determines if--
    (1) There is a substantial likelihood that the application is of 
exceptional quality and national significance for a program administered 
by ED;
    (2) The application meets the requirements of all applicable 
statutes and codified regulations that apply to the program; and
    (3) Selection of the project will not have an adverse impact on the 
funds available for other awards planned for the program.
    (c) If the Secretary determines that the criteria in paragraph (b) 
of this section have been met, the Secretary assembles a panel of 
experts that does not include any employees of the Department to review 
the application.
    (d) The experts--
    (1) Evaluate the application based on the selection criteria; and
    (2) Determine whether the application is of such exceptional quality 
and national significance that it should be funded as an unsolicited 
application.
    (e) If the experts highly rate the application and determine that 
the application is of such exceptional quality and national significance 
that it should be funded as an unsolicited application, the Secretary 
may fund the application.

    Note to Sec. 75.222: To assure prompt consideration, applicants 
submitting unsolicited applications should send the application, marked 
``Unsolicited Application'' on the outside, to the Chief, Application 
Control Center, U.S. Department of Education, Washington, DC 20202-4725.

(Authority: 20 U.S.C. 1221e-3 and 3474)

[60 FR 12096, Mar. 3, 1995]



Sec. 75.223  [Reserved]



Sec. 75.224  What are the procedures for using a multiple tier review
process to evaluate applications?

    (a) The Secretary may use a multiple tier review process to evaluate 
applications.
    (b) The Secretary may refuse to review applications in any tier that 
do not meet a minimum cut-off score established for the prior tier.
    (c) The Secretary may establish the minimum cut-off score--
    (1) In the application notice published in the Federal Register; or
    (2) After reviewing the applications to determine the overall range 
in the quality of applications received.

[[Page 125]]

    (d) The Secretary may, in any tier--
    (1) Use more than one group of experts to gain different 
perspectives on an application; and
    (2) Refuse to consider an application if the application is rejected 
under paragraph (b) of this section by any one of the groups used in the 
prior tier.

(Authority: 20 U.S.C. 1221e-3 and 3474)

[66 FR 60138, Nov. 30, 2001]



Sec. 75.225  What procedures does the Secretary use if the Secretary 
decides to give special consideration to novice applications?

    (a) As used in this section, ``novice applicant'' means--
    (1) Any applicant for a grant from ED that--
    (i) Has never received a grant or subgrant under the program from 
which it seeks funding;
    (ii) Has never been a member of a group application, submitted in 
accordance with Secs. 75.127-75.129, that received a grant under the 
program from which it seeks funding; and
    (iii) Has not had an active discretionary grant from the Federal 
Government in the five years before the deadline date for applications 
under the program.
    (2) In the case of a group application submitted in accordance with 
Secs. 75.127-75.129, a group that includes only parties that meet the 
requirements of paragraph (a)(1) of this section.
    (b) For the purposes of paragraph (a)(1)(iii) of this section, a 
grant is active until the end of the grant's project or funding period, 
including any extensions of those periods that extend the grantee's 
authority to obligate funds.
    (c) If the Secretary determines that special consideration of novice 
applications is appropriate, the Secretary may either--
    (1) Establish a separate competition for novice applicants; or
    (2) Give competitive preference to novice applicants under the 
procedures in 34 CFR 75.105(c)(2).
    (d) Before making a grant to a novice applicant, the Secretary 
imposes special conditions, if necessary, to ensure the grant is managed 
effectively and project objectives are achieved.

(Authority: 20 U.S.C. 1221e-3 and 3474)

[66 FR 60138, Nov. 30, 2001; 67 FR 4316, Jan. 29, 2002]



75.226  What procedures does the Secretary use if the Secretary 
decides to give special consideration to applications supported 
by strong evidence of effectiveness, moderate evidence of
effectiveness, or evidence of promise?

    (a) As used in this section, ``strong evidence of effectiveness'' is 
defined in 34 CFR 77.1(c);
    (b) As used in this section, ``moderate evidence of effectiveness'' 
is defined in 34 CFR 77.1(c);
    (c) As used in this section, ``evidence of promise'' is defined in 
34 CFR 77.1(c); and
    (d) If the Secretary determines that special consideration of 
applications supported by strong evidence of effectiveness, moderate 
evidence of effectiveness, or evidence of promise is appropriate, the 
Secretary may establish a separate competition under the procedures in 
34 CFR 75.105(c)(3), or provide competitive preference under the 
procedures in 34 CFR 75.105(c)(2), for applications supported by:
    (1) Evidence of effectiveness that meets the conditions set out in 
paragraph (a) of the definition of ``strong evidence of effectiveness'' 
in 34 CFR 77.1(c);
    (2) Evidence of effectiveness that meets the conditions set out in 
either paragraph (a) or (b) of the definition of ``strong evidence of 
effectiveness'' in 34 CFR 77.1(c);
    (3) Evidence of effectiveness that meets the conditions set out in 
the definition of ``moderate evidence of effectiveness;'' or
    (4) Evidence of effectiveness that meets the conditions set out in 
the definition of ``evidence of promise.''

    Authority: 20 U.S.C. 1221e-3 and 3474.

[Redesignated at 80 FR 2608, Jan. 20, 2015]

                       Procedures To Make a Grant



Sec. 75.230  How the Department makes a grant; purpose of
Secs. 75.231-75.236.

    If the Secretary selects an application under Secs. 75.217, 75.220, 
or 75.222, the

[[Page 126]]

Secretary follows the procedures in Secs. 75.231-75.236 to set the 
amount and determine the conditions of a grant. Sections 75.235-75.236 
also apply to grants under formula grant programs.

(Authority: 20 U.S.C. 1221e-3 and 3474)

    Cross Reference: See Sec. 75.200 How applications for new grants are 
selected for funding.



Sec. 75.231  Additional information.

    After selecting an application for funding, the Secretary may 
require the applicant to submit additional information.

(Authority: 20 U.S.C. 1221e-3 and 3474)



Sec. 75.232  The cost analysis; basis for grant amount.

    (a) Before the Secretary sets the amount of a new grant, the 
Secretary does a cost analysis of the project. The Secretary:
    (1) Verifies the cost data in the detailed budget for the project;
    (2) Evaluates specific elements of costs; and
    (3) Examines costs to determine if they are necessary, reasonable, 
and allowable under applicable statutes and regulations.
    (b) The Secretary uses the cost analysis as a basis for determining 
the amount of the grant to the applicant. The cost analysis shows 
whether the applicant can achieve the objectives of the project with 
reasonable efficiency and economy under the budget in the application.

(Authority: 20 U.S.C. 1221e-3 and 3474)

[45 FR 22497, Apr. 3, 1980. Redesignated at 45 FR 77368, Nov. 21, 1980, 
as amended at 59 FR 30261, June 10, 1994]



Sec. 75.233  Setting the amount of the grant.

    (a) Subject to any applicable matching or cost-sharing requirements, 
the Secretary may fund up to 100 percent of the allowable costs in the 
applicant's budget.
    (b) In deciding what percentage of the allowable costs to fund, the 
Secretary may consider any other financial resources available to the 
applicant.

(Authority: 20 U.S.C. 1221e-3 and 3474)

[57 FR 30338, July 8, 1992]



Sec. 75.234  The conditions of the grant.

    (a) The Secretary makes a grant to an applicant only after 
determining--
    (1) The approved costs; and
    (2) Any special conditions.
    (b) In awarding a cooperative agreement, the Secretary includes 
conditions that state the explicit character and extent of anticipated 
collaboration between the Department and the recipient.

(Authority: 20 U.S.C. 1221e-3 and 3474)

[57 FR 30338, July 8, 1992]



Sec. 75.235  The notification of grant award.

    (a) To make a grant, the Secretary issues a notification of grant 
award and sends it to the grantee.
    (b) The notification of grant award sets the amount of the grant 
award and establishes other specific conditions, if any.

(Authority: 20 U.S.C. 1221e-3 and 3474)

[45 FR 22497, Apr. 3, 1980. Redesignated at 45 FR 77368, Nov. 21, 1980, 
as amended at 57 FR 30338, July 8, 1992]



Sec. 75.236  Effect of the grant.

    The grant obligates both the Federal Government and the grantee to 
the requirements that apply to the grant.

(Authority: 20 U.S.C. 1221e-3 and 3474)

    Cross Reference:  See 2 CFR 200.308, Revision of budget and program 
plans.

                     Approval of Multi-Year Projects



Sec. 75.250  Maximum funding period.

    (a) The Secretary may approve a project period of up to 60 months to 
perform the substantive work of a grant.
    (b) The Secretary may approve a data collection period for a grant 
for a period of up to 72 months after the end of the project period and 
provide funding for the data collection period for the sole purpose of 
collecting, analyzing, and reporting performance measurement data 
regarding the project. The Secretary may inform applicants of the 
Secretary's intent to approve data collection periods in the application 
notice published for a competition or

[[Page 127]]

may decide to fund data collection periods after grantees have started 
their project periods.

(Authority: 20 U.S.C. 1221e-3 and 3474.)

[78 FR 49353, Aug. 13, 2013]



Sec. 75.251  Budget periods.

    (a) The Secretary usually approves a budget period of not more than 
12 months, even if the project has a multi-year project period.
    (b) If the Secretary approves a multi-year project period, the 
Secretary:
    (1) Makes a grant to the project for the initial budget period; and
    (2) Indicates his or her intention to make contination awards to 
fund the remainder of the project period.
    (c) If the Secretary funds a multi-year data collection period, the 
Secretary may fund the data collection period through separate budget 
periods and fund those budget periods in the same manner as those 
periods are funded during the project period.

[45 FR 22497, Apr. 3, 1980, as amended at 78 FR 49354, Aug. 13, 2013]

(Authority: 20 U.S.C. 1221e-3 and 3474)



Sec. 75.253  Continuation of a multi-year project after the first
budget period.

    (a) The Secretary may make a continuation award for a budget period 
after the first budget period of an approved multi-year project if:
    (1) The Congress has appropriated sufficient funds under the 
program;
    (2) The grantee has either--
    (i) Made substantial progress in achieving--
    (A) The goals and objectives of the project; and
    (B) If the Secretary established performance measurement 
requirements for the grant in the application notice, the performance 
targets in the grantee's approved application; or
    (ii) Obtained the Secretary's approval for changes to the project 
that--
    (A) Do not increase the amount of funds obligated to the project by 
the Secretary; and
    (B) Enable the grantee to achieve the goals and objectives of the 
project and meet the performance targets of the project, if any, without 
changing the scope or objectives of the project.
    (3) The recipient has submitted all reports as required by 
Sec. 75.118, and
    (4) Continuation of the project is in the best interest of the 
Federal Government.
    (5) The grantee has maintained financial and administrative 
management systems that meet the requirements in 2 CFR 200.302, 
Financial management, and 200.303, Internal controls.
    (b) In deciding whether a grantee has made substantial progress, the 
Secretary may consider any information relevant to the authorizing 
statute, a criterion, a priority, or a performance measure, or to a 
financial or other requirement that applies to the selection of 
applications for new grants.
    (c) Subject to the criteria in paragraph (a) of this section, in 
selecting applications for funding under a program the Secretary gives 
priority to contination awards over new grants.
    (d)(1) Notwithstanding any regulatory requirements in 2 CFR part 
200, a grantee may expend funds that have not been obligated at the end 
of a budget period for obligations of the subsequent budget period if--
    (i) The obligation is for an allowable cost that falls within the 
scope and objectives of the project; and
    (ii) ED regulations, including those in title 2 of the CFR, 
statutes, or the conditions of the grant do not prohibit the obligation.

    Note: See 2 CFR 200.308(d)(2).

    (2) The Secretary may--
    (i) Require the grantee to send a written statement describing how 
the funds made available under this section will be used; and
    (ii) Determine the amount of new funds that the Department will make 
available for the subsequent budget period after considering the 
statement the grantee provides under paragraph (c)(2)(i) of this section 
or any other information available to the Secretary about the use of 
funds under the grant.
    (3) In determining the amount of new funds to make available to a 
grantee under this section, the Secretary considers whether the 
unobligated funds made available are needed to complete activities that 
were planned for completion in the prior budget period.

[[Page 128]]

    (e)(1) If the Secretary decides, under this section, not to make a 
continuation award, the Secretary may authorize a no-cost extension of 
the last budget period of the grant in order to provide for the orderly 
closeout of the grant.
    (2) If the Secretary makes a continuation award under this section--
    (i) The Secretary makes the award under Secs. 75.231-75.236; and
    (ii) The new budget period begins on the day after the previous 
budget period ends.
    (f) Unless prohibited by the program statute or regulations, a 
grantee that is in the final budget period of its project period may 
seek continued assistance for the project as required under the 
procedures for selecting new projects for grants.

(Authority: 20 U.S.C. 1221e-3 and 3474)

    Cross References: 1. See Subpart C--How to Apply for a Grant.

    2. See Sec. 75.117 Information needed for a multi-year project; and 
Sec. 75.118 Application for a continuation award.

[45 FR 22497, Apr. 3, 1980. Redesignated at 45 FR 77368, Nov. 21, 1980, 
as amended at 57 FR 30338, July 8, 1992; 59 FR 30261, June 10, 1994; 62 
FR 40424, July 28, 1997; 78 FR 49354, Aug. 13, 2013; 79 FR 76092, Dec. 
19, 2014]



Sec. 75.254  [Reserved]

                              Miscellaneous



Sec. 75.260  Allotments and reallotments.

    (a) Under some of the programs covered by this part, the Secretary 
allots funds under a statutory or regulatory formula.
    (b) Any reallotment to other grantees will be made by the Secretary 
in accordance with the authorizing statute for that program.

(Authority: 20 U.S.C. 1221e-3 and 3474)

[45 FR 22497, Apr. 3, 1980. Redesignated at 45 FR 77368, Nov. 21, 1980, 
as amended at 52 FR 27804, July 24, 1987]



Sec. 75.261  Extension of a project period.

    (a) General rule. A grantee may extend the project period of an 
award one time for a period up to twelve months without the prior 
approval of the Secretary, if--
    (1) The grantee meets the requirements for extension in 2 CFR 
200.308(d)(2); and
    (2) ED statutes, regulations other than those in 2 CFR part 200, or 
the conditions of an award do not prohibit the extension.
    (b) Specific rule for certain programs of the National Institute on 
Disability and Rehabilitation Research. Notwithstanding paragraph (a) of 
this section, grantees under the following programs of NIDRR must 
request prior approval to extend their grants under paragraph (c) of 
this section:
    (1) The Knowledge Dissemination and Utilization Centers and 
Disability and Technical Assistance Centers authorized under 29 U.S.C. 
761a(b)(2), (4), (5), (6), and (11) and implemented at 34 CFR part 350, 
subpart B, Secs. 350.17-350.19.
    (2) The Rehabilitation Research and Training Centers program 
authorized under 29 U.S.C. 762(b) and implemented at 34 CFR part 350, 
subpart C.
    (3) The Rehabilitation Engineering Research Centers authorized under 
29 U.S.C. 762(b)(3) and implemented at 34 CFR part 350, subpart D.
    (4) The Special Projects and Demonstrations for Spinal Cord Injuries 
authorized under 29 U.S.C. 762(b)(4) and implemented at 34 CFR part 359.
    (c) Other regulations. If ED regulations other than the regulations 
in 2 CFR part 200 or the conditions of the award require the grantee to 
obtain prior approval to extend the project period, the Secretary may 
permit the grantee to extend the project period if--
    (1) The extension does not violate any statute or regulations;
    (2) The extension does not involve the obligation of additional 
Federal funds;
    (3) The extension is to carry out the activities in the approved 
application; and
    (4)(i) The Secretary determines that, due to special or unusual 
circumstances applicable to a class of grantees, the project periods for 
the grantees should be extended; or
    (ii)(A) The Secretary determines that special or unusual 
circumstances would delay completion of the project beyond the end of 
the project period;

[[Page 129]]

    (B) The grantee requests an extension of the project at least 45 
calendar days before the end of the project period; and
    (C) The grantee provides a written statement before the end of the 
project period giving the reasons why the extension is appropriate under 
paragraph (c)(4)(ii)(A) of this section and the period for which the 
project needs extension.
    (d) Waiver. The Secretary may waive the requirement in paragraph 
(a)(4)(ii)(B) of this section if--
    (1) The grantee could not reasonably have known of the need for the 
extension on or before the start of the 45-day time period; or
    (2) The failure to give notice on or before the start of the 45-day 
time period was unavoidable.

(Authority: 20 U.S.C. 1221e-3 and 3474)

[57 FR 30338, July 8, 1992, as amended at 62 FR 40424, July 28, 1997; 79 
FR 76092, Dec. 19, 2014]



Sec. 75.262  Conversion of a grant or a cooperative agreement.

    (a)(1) The Secretary may convert a grant to a cooperative agreement 
or a cooperative agreement to a grant at the time a continuation award 
is made under Sec. 75.253.
    (2) In deciding whether to convert a grant to a cooperative 
agreement or a cooperative agreement to a grant, the Secretary considers 
the factors included in Sec. 75.200(b) (4) and (5).
    (b) The Secretary and a recipient may agree at any time to convert a 
grant to a cooperative agreement or a cooperative agreement to a grant, 
subject to the factors included in Sec. 75.200(b) (4) and (5).

(Authority: 20 U.S.C. 1221e-3 and 3474)

[57 FR 30339, July 8, 1992]



Sec. 75.263  Pre-award costs; waiver of approval.

    A grantee may, notwithstanding any requirement in 2 CFR part 200, 
incur pre-award costs as specified in 2 CFR 200.308(d)(1) unless--
    (a) ED regulations other than 2 CFR part 200 or a statute prohibit 
these costs; or
    (b) The conditions of the award prohibit these costs.

(Authority: 20 U.S.C. 1221e-3 and 3474; 2 CFR 200.308(d)(1))

[80 FR 67264, Nov. 2, 2015]



Sec. 75.264  Transfers among budget categories.

    A grantee may make transfers as specified in 2 CFR 200.308 unless--
    (a) ED regulations other than those in 2 CFR part 200 or a statute 
prohibit these transfers; or
    (b) The conditions of the grant prohibit these transfers.

(Authority 20 U.S.C. 1221e-3, 3474, 2 CFR part 200)

[79 FR 76092, Dec. 19, 2014]



           Subpart E_What Conditions Must Be Met by a Grantee?

                            Nondiscrimination



Sec. 75.500  Federal statutes and regulations on nondiscrimination.

    (a) Each grantee shall comply with the following statutes and 
regulations:

------------------------------------------------------------------------
             Subject                    Statute           Regulations
------------------------------------------------------------------------
Discrimination on the basis of    Title VI of the     34 CFR part 100.
 race, color or national origin.   Civil Rights Act
                                   of 1964 (42
                                   U.S.C. 2000d
                                   through 2000d-4).
Discrimination on the basis of    Title IX of the     34 CFR part 106.
 sex.                              Education
                                   Amendments of
                                   1972 (20 U.S.C.
                                   1681-1683).
Discrimination on the basis of    Section 504 of the  34 CFR part 104.
 handicap.                         Rehabilitation
                                   Act of 1973 (29
                                   U.S.C. 794).
Discrimination on the basis of    The Age             34 CFR part 110.
 age.                              Discrimination
                                   Act (42 U.S.C.
                                   6101 et seq.).
------------------------------------------------------------------------

    (b) A grantee that is a covered entity as defined in Sec. 108.3 of 
this title shall comply with the nondiscrimination requirements of the 
Boy Scouts of America Equal Access Act, 20 U.S.C. 7905, 34 CFR part 108.

(Authority: 20 U.S.C. 1221e-3 and 3474)

[45 FR 22497, Apr. 3, 1980. Redesignated at 45 FR 77368, Nov. 21, 1980, 
as amended at 71 FR 15002, Mar. 24, 2006]

[[Page 130]]

                              Project Staff



Sec. 75.511  Waiver of requirement for a full-time project director.

    (a) If regulations under a program require a full-time project 
director, the Secretary may waive that requirement under the following 
conditions:
    (1) The project will not be adversely affected by the waiver.
    (2)(i) The project director is needed to coordinate two or more 
related projects; or
    (ii) The project director must teach a minimum number of hours to 
retain faculty status.
    (b) The waiver either permits the grantee:
    (1) To use a part-time project director; or
    (2) Not to use any project director.
    (c)(1) An applicant or a grantee may request the waiver.
    (2) The request must be in writing and must demonstrate that a 
waiver is appropriate under this section.
    (3) The Secretary gives the waiver in writing. The waiver is 
effective on the date the Secretary signs the waiver.

(Authority: 20 U.S.C. 1221e-3 and 3474)

    Cross Reference: See 2 CFR 200.308, Revision of budget and program 
plans.



Sec. 75.515  Use of consultants.

    (a) Subject to Federal statutes and regulations, a grantee shall use 
its general policies and practices when it hires, uses, and pays a 
consultant as part of the project staff.
    (b) The grantee may not use its grant to pay a consultant unless:
    (1) There is a need in the project for the services of that 
consultant; and
    (2) The grantee cannot meet that need by using an employee rather 
than a consultant.

(Authority: 20 U.S.C. 1221e-3 and 3474)



Sec. 75.516  Compensation of consultants--employees of institutions
of higher education.

    If an institution of higher education receives a grant for research 
or for educational services, it may pay a consultant's fee to one of its 
employees only in unusual circumstances and only if:
    (a) The work performed by the consultant is in addition to his or 
her regular departmental load; and
    (b)(1) The consultation is across departmental lines; or
    (2) The consultation involves a separate or remote operation.

(Authority: 20 U.S.C. 1221e-3 and 3474)



Sec. 75.517  [Reserved]



Sec. 75.519  Dual compensation of staff.

    A grantee may not use its grantee to pay a project staff member for 
time or work for which that staff member is compensated from some other 
source of funds.

(Authority: 20 U.S.C. 1221e-3 and 3474)

                          Conflict of Interest



Sec. 75.524  Conflict of interest: Purpose of Sec. 75.525.

    (a) The conflict of interest regulations of the Department that 
apply to a grant are in Sec. 75.525.
    (b) These conflict of interest regulations do not apply to a ``local 
government,'' as defined in 2 CFR 200.64, or a ``State,'' as defined in 
2 CFR 200.90.
    (c) The regulations in Sec. 75.525 do not apply to a grantee's 
procurement contracts. The conflict of interest regulations that cover 
those procurement contracts are in 2 CFR part 200.

(Authority: 20 U.S.C. 1221e-3 and 3474)

[45 FR 22497, Apr. 3, 1980, as amended at 64 FR 50391, Sept. 16, 1999; 
79 FR 76092, Dec. 19, 2014]



Sec. 75.525  Conflict of interest: Participation in a project.

    (a) A grantee may not permit a person to participate in an 
administrative decision regarding a project if:
    (1) The decision is likely to benefit that person or a member of his 
or her immediate family; and
    (2) The person:
    (i) Is a public official; or
    (ii) Has a family or business relationship with the grantee.
    (b) A grantee may not permit any person participating in the project 
to use his or her position for a purpose that is--or gives the 
appearance of

[[Page 131]]

being--motivated by a desire for a private financial gain for that 
person or for others.

(Authority: 20 U.S.C. 1221e-3 and 3474)

                             Allowable Costs



Sec. 75.530  General cost principles.

    The general principles to be used in determining costs applicable to 
grants and cost-type contracts under grants are specified at 2 CFR part 
200, subpart E--Cost Principles.

(Authority: 20 U.S.C. 1221e-3 and 3474)
    Cross Reference: See 2 CFR part 200, subpart D--Post Federal Award 
Requirements.

[79 FR 76092, Dec. 19, 2014]



Sec. 75.531  Limit on total cost of a project.

    A grantee shall insure that the total cost to the Federal Government 
is not more than the amount stated in the notification of grant award.

(Authority: 20 U.S.C. 1221e-3 and 3474)



Sec. 75.532  Use of funds for religion prohibited.

    (a) No grantee may use its grant to pay for any of the following:
    (1) Religious worship, instruction, or proselytization.
    (2) Equipment or supplies to be used for any of the activities 
specified in paragraph (a)(1) of this section.
    (b) [Reserved]

(Authority: 20 U.S.C. 1221e-3 and 3474)

[45 FR 22497, Apr. 3, 1980. Redesignated at 45 FR 77368, Nov. 21, 1980, 
as amended at 69 FR 31711, June 4, 2004]



Sec. 75.533  Acquisition of real property; construction.

    No grantee may use its grant for acquisition of real property or for 
construction unless specifically permitted by the authorizing statute or 
implementing regulations for the program.

(Authority: 20 U.S.C. 1221e-3 and 3474)



Sec. 75.534  Training grants--automatic increases for additional
dependents.

    The Secretary may increase a grant to cover the cost of additional 
dependents not specified in the notice of award under Sec. 75.235 if--
    (a) Allowances for dependents are authorized by the program statute 
and are allowable under the grant; and
    (b) Appropriations are available to cover the cost.

(Authority: 20 U.S.C. 1221e-3 and 3474)

[45 FR 22497, Apr. 3, 1980. Redesignated at 45 FR 77368, Nov. 21, 1980, 
as amended at 57 FR 30339, July 8, 1992]

                           Indirect Cost Rates



Sec. 75.560  General indirect cost rates; exceptions.

    (a) The differences between direct and indirect costs and the 
principles for determining the general indirect cost rate that a grantee 
may use for grants under most programs are specified in the cost 
principles for--
    (1) All grantees, other than hospitals and commercial (for-profit) 
organizations, at 2 CFR part 200, subpart E--Cost Principles;
    (2) Hospitals, at 45 CFR part 75, Appendix XI--Principles for 
Determining Cost Applicable to Research and Development Under Awards and 
Contracts with Hospitals; and
    (3) Commercial (for-profit) organizations, at 48 CFR part 31 
Contract Cost Principles and Procedures.
    (b) A grantee must have obtained a current indirect cost rate 
agreement from its cognizant agency, to charge indirect costs to a 
grant. To obtain an indirect cost rate, a grantee must submit an 
indirect cost proposal to its cognizant agency within 90 days after the 
date the Department issues the Grant Award Notification (GAN).
    (c) If a grantee does not have a federally recognized indirect cost 
rate agreement, the Secretary may permit the grantee to charge its grant 
for indirect costs at a temporary rate of 10 percent of budgeted direct 
salaries and wages.
    (d)(1) If a grantee fails to submit an indirect cost rate proposal 
to its cognizant agency within the required 90 days, the grantee may not 
charge indirect costs to its grant from the end of the 90-day period 
until it obtains a federally recognized indirect cost rate agreement 
applicable to the grant.

[[Page 132]]

    (2) If the Secretary determines that exceptional circumstances 
warrant continuation of a temporary indirect cost rate, the Secretary 
may authorize the grantee to continue charging indirect costs to its 
grant at the temporary rate specified in paragraph (c) of this section 
even though the grantee has not submitted its indirect cost rate 
proposal within the 90-day period.
    (3) Once a grantee obtains a federally recognized indirect cost rate 
that is applicable to the affected grant, the grantee may use that 
indirect cost rate to claim indirect cost reimbursement for expenditures 
made on or after the date the grantee submitted its indirect cost 
proposal to its cognizant agency or the start of the project period, 
whichever is later. However, this authority is subject to the following 
limitations:
    (i) The total amount of funds recovered by the grantee under the 
federally recognized indirect cost rate is reduced by the amount of 
indirect costs previously recovered under the temporary indirect cost 
rate.
    (ii) The grantee must obtain prior approval from the Secretary to 
shift direct costs to indirect costs in order to recover indirect costs 
at a higher negotiated indirect cost rate.
    (iii) The grantee may not request additional funds to recover 
indirect costs that it cannot recover by shifting direct costs to 
indirect costs.
    (e) The Secretary accepts an indirect cost rate negotiated by a 
grantee's cognizant agency, but may establish a restricted indirect cost 
rate for a grantee to satisfy the statutory requirements of certain 
programs administered by the Department.

(Authority: 20 U.S.C. 1221e-3 and 3474)

[45 FR 22497, Apr. 3, 1980. Redesignated at 45 FR 77368, Nov. 21, 1980, 
as amended at 57 FR 30339, July 8, 1992; 59 FR 59582, Nov. 17, 1994; 72 
FR 69147, Dec. 7, 2007; 79 FR 76092, Dec. 19, 2014]



Sec. 75.561  Approval of indirect cost rates.

    (a) If the Department of Education is the cognizant agency, the 
Secretary approves an indirect cost rate for a grantee other than a 
local educational agency. For the purposes of this section, the term 
local educational agency does not include a State agency.
    (b) Each State educational agency, on the basis of a plan approved 
by the Secretary, shall approve an indirect cost rate for each local 
educational agency that requests it to do so. These rates may be for 
periods longer than a year if rates are sufficiently stable to justify a 
longer period.
    (c) The Secretary generally approves indirect cost rate agreements 
annually. Indirect cost rate agreements may be approved for periods 
longer than a year if the Secretary determines that rates will be 
sufficiently stable to justify a longer rate period.

(Authority: 20 U.S.C. 1221e-3 and 3474)

[59 FR 59583, Nov. 17, 1994]



Sec. 75.562  Indirect cost rates for educational training projects.

    (a) Educational training grants provide funding for training or 
other educational services. Examples of the work supported by training 
grants are summer institutes, training programs for selected 
participants, the introduction of new or expanded courses, and similar 
instructional undertakings that are separately budgeted and accounted 
for by the sponsoring institution. These grants do not usually support 
activities involving research, development, and dissemination of new 
educational materials and methods. Training grants largely implement 
previously developed materials and methods and require no significant 
adaptation of techniques or instructional services to fit different 
circumstances.
    (b) The Secretary uses the definition in paragraph (a) to determine 
which grants are educational training grants.
    (c)(1) Indirect cost reimbursement on a training grant is limited to 
the recipient's actual indirect costs, as determined in its negotiated 
indirect cost rate agreement, or eight percent of a modified total 
direct cost base, whichever amount is less.

    Note to paragraph (c)(1): If the grantee did not have a federally 
recognized indirect cost rate agreement on the date the training grant 
was awarded, indirect cost recovery is also limited to the amount 
authorized under Sec. 75.560(d)(3).


[[Page 133]]


    (2) For the purposes of this section, a modified total direct cost 
base consists of total direct costs minus the following:
    (i) The amount of each sub-award in excess of $25,000.
    (ii) Stipends.
    (iii) Tuition and related fees.
    (iv) Equipment, as defined in 2 CFR 200.33.

    Note to paragraph (c)(2)(iv): If the grantee has established a 
threshold for equipment that is lower than $5,000 for other purposes, it 
must use that threshold to exclude equipment under the modified total 
direct cost base for the purposes of this section.

    (3) The eight percent indirect cost reimbursement limit specified in 
paragraph (c)(1) of this section also applies to sub-awards that fund 
training, as determined by the Secretary under paragraph (b) of this 
section.
    (4) The eight percent limit does not apply to agencies of Indian 
tribal governments, local governments, and States as defined in 2 CFR 
200.54, 200.200.64, and 200.90, respectively.
    (5) Indirect costs in excess of the eight percent limit may not be 
charged directly, used to satisfy matching or cost-sharing requirements, 
or charged to another Federal award.
    (d) A grantee using the training rate of eight percent is required 
to have documentation available for audit that shows that its negotiated 
indirect cost rate is at least eight percent.

(Authority: 20 U.S.C. 1221e-3 and 3474)

[59 FR 59582, Nov. 17, 1994, as amended at 72 FR 69147, Dec. 7, 2007; 79 
FR 76092, Dec. 19, 2014]



Sec. 75.563  Restricted indirect cost rate--programs covered.

    If a grantee decides to charge indirect costs to a program that has 
a statutory requirement prohibiting the use of Federal funds to supplant 
non-Federal funds, the grantee shall use a restricted indirect cost rate 
computed under 34 CFR 76.564 through 76.569.

(Authority: 20 U.S.C. 1221e-3 and 3474)

[59 FR 59583, Nov. 17, 1994]



Sec. 75.564  Reimbursement of indirect costs.

    (a) Reimbursement of indirect costs is subject to the availability 
of funds and statutory or administrative restrictions.
    (b) The application of the rates and the determination of the direct 
cost base by a grantee must be in accordance with the indirect cost rate 
agreement approved by the grantee's cognizant agency.
    (c) Indirect cost reimbursement is not allowable under grants for--
    (1) Fellowships and similar awards if Federal financing is 
exclusively in the form of fixed amounts such as scholarships, stipend 
allowances, or the tuition and fees of an institution;
    (2) Construction grants;
    (3) Grants to individuals;
    (4) Grants to organizations located outside the territorial limits 
of the United States;
    (5) Grants to Federal organizations; and
    (6) Grants made exclusively to support conferences.
    (d) Indirect cost reimbursement on grants received under programs 
with statutory restrictions or other limitations on indirect costs must 
be made in accordance with the restrictions in 34 CFR 76.564 through 
76.569.
    (e)(1) Indirect costs for a group of eligible parties (See 
Secs. 75.127 through 75.129) are limited to the amount derived by 
applying the rate of the applicant, or a restricted rate when 
applicable, to the direct cost base for the grant in keeping with the 
terms of the applicant's federally recognized indirect cost rate 
agreement.
    (2) If a group of eligible parties applies for a training grant 
under the group application procedures in Secs. 75.127 through 75.129, 
the grant funds allocated among the members of the group are not 
considered sub-awards for the purposes of applying the indirect cost 
rate in Sec. 75.562(c).

(Authority: 20 U.S.C. 1221e-3 and 3474)

[59 FR 59583, Nov. 17, 1994, as amended at 72 FR 69148, Dec. 7, 2007]



Sec. 75.580  Coordination with other activities.

    A grantee shall, to the extent possible, coordinate its project with 
other activities that are in the same geographic area served by the 
project and

[[Page 134]]

that serve similar purposes and target groups.

(Authority: 20 U.S.C. 1221e-3, 2890, and 3474)

[45 FR 22497, Apr. 3, 1980. Redesignated at 45 FR 77368, Nov. 21, 1980, 
as amended at 57 FR 30339, July 8, 1992]

                               Evaluation



Sec. 75.590  Evaluation by the grantee.

    (a) If the application notice for a competition required applicants 
to describe how they would evaluate their projects, each grantee under 
that competition must demonstrate to the Department that--
    (1) The evaluation meets the standards of the evaluation in the 
approved application for the project; and
    (2) The performance measurement data collected by the grantee and 
used in the evaluation meet the performance measurement requirements of 
the approved application.
    (b) If the application notice for a competition did not require 
applicants to describe how they would evaluate their projects, each 
grantee must provide information in its performance report 
demonstrating--
    (1) The progress made by the grantee in the most recent budget 
period, including progress based on the performance measurement 
requirements for the grant, if any;
    (2) The effectiveness of the grant, including fulfilling the 
performance measurement requirements of the approved application, if 
any; and
    (3) The effect of the project on the participants served by the 
project, if any.

(Authority: 20 U.S.C. 1221e-3 and 3474.)

[78 FR 49354, Aug. 13, 2013]



Sec. 75.591  Federal evaluation--cooperation by a grantee.

    A grantee shall cooperate in any evaluation of the program by the 
Secretary.

(Authority: 20 U.S.C. 1221e-3 and 3474)

[45 FR 86297, Dec. 30, 1980]



Sec. 75.592  Federal evaluation--satisfying requirement for grantee
evaluation.

    If a grantee cooperates in a Federal evaluation of a program, the 
Secretary may determine that the grantee meets the evaluation 
requirements of the program, including Sec. 75.590.

(Authority: 20 U.S.C. 1221e-3 and 3474)

                              Construction

    Cross Reference: See 2 CFR part 200.317-200.326 for procurement 
requirements.



Sec. 75.600  Use of a grant for construction: Purpose of 
Secs. 75.601-75.615.

    Sections 75.601-75.615 apply to:
    (a) An applicant that requests funds for construction; and
    (b) A grantee whose grant includes funds for construction.

(Authority: 20 U.S.C. 1221e-3 and 3474)



Sec. 75.601  Applicant's assessment of environmental impact.

    An applicant shall include with its application its assessment of 
the impact of the proposed construction on the quality of the 
environment in accordance with section 102(2)(C) of the National 
Environmental Policy Act of 1969 and Executive Order 11514 (34 FR 4247).

(Authority: 20 U.S.C. 1221e-3 and 3474)



Sec. 75.602  Preservation of historic sites must be described in the 
application.

    (a) An applicant shall describe in its application the relationship 
of the proposed construction to and probable effect on any district, 
site, building, structure, or object that is:
    (1) Included in the National Register of Historic Places; or
    (2) Eligible under criteria established by the Secretary of Interior 
for inclusion in the National Register of Historic Places.

    Cross Reference: See 36 CFR part 60 for these criteria.
    (b) In deciding whether to make a grant, the Secretary considers:
    (1) The information provided by the applicant under paragraph (a) of 
this section; and
    (2) Any comments by the Advisory Council on Historic Preservation.

    Cross Reference: See 36 CFR part 800, which provides for comments 
from the Council.

(Authority: 20 U.S.C. 1221e-3 and 3474)

[[Page 135]]



Sec. 75.603  Grantee's title to site.

    A grantee must have or obtain a full title or other interest in the 
site, including right of access, that is sufficient to insure the 
grantee's undisturbed use and possession of the facilities for 50 years 
or the useful life of the facilities, whichever is longer.

(Authority: 20 U.S.C. 1221e-3 and 3474)



Sec. 75.604  Availability of cost-sharing funds.

    A grantee shall ensure that sufficient funds are available to meet 
any non-Federal share of the cost of constructing the facility.

(Authority: 20 U.S.C. 1221e-3 and 3474)



Sec. 75.605  Beginning the construction.

    (a) A grantee shall begin work on construction within a reasonable 
time after the grant for the construction is made.
    (b) Before construction is advertised or placed on the market for 
bidding, the grantee shall get approval by the Secretary of the final 
working drawings and specifications.

(Authority: 20 U.S.C. 1221e-3 and 3474)



Sec. 75.606  Completing the construction.

    (a) A grantee shall complete its construction within a reasonable 
time.
    (b) The grantee shall complete the construction in accordance with 
the application and approved drawings and specifications.

(Authority: 20 U.S.C. 1221e-3 and 3474)



Sec. 75.607  General considerations in designing facilities and 
carrying out construction.

    (a) A grantee shall insure that the construction is:
    (1) Functional;
    (2) Economical; and
    (3) Not elaborate in design or extravagant in the use of materials, 
compared with facilities of a similar type constructed in the State or 
other applicable geographic area.
    (b) The grantee shall, in developing plans for the facilities, 
consider excellence of architecture and design and inclusion of works of 
art. The grantee may not spend more than one percent of the cost of the 
project on inclusion of works of art.

(Authority: 20 U.S.C. 1221e-3 and 3474)



Sec. 75.608  Areas in the facilities for cultural activities.

    A grantee may make reasonable provision, consistent with the other 
uses to be made of the facilities, for areas in the facilities that are 
adaptable for artistic and other cultural activities.

(Authority: 20 U.S.C. 1221e-3 and 3474)

[57 FR 30339, July 8, 1992]



Sec. 75.609  Comply with safety and health standards.

    In planning for and designing facilities, a grantee shall observe:
    (a) The standards under the Occupational Safety and Health Act of 
1970 (Pub. L. 91-576) (See 36 CFR part 1910); and
    (b) State and local codes, to the extent that they are more 
stringent.

(Authority: 20 U.S.C. 1221e-3 and 3474)



Sec. 75.610  Access by the handicapped.

    A grantee shall comply with the Federal regulations on access by the 
handicapped that apply to construction and alteration of facilities. 
These regulations are:
    (a) For residential facilities--24 CFR part 40; and
    (b) For non-residential facilities--41 CFR subpart 101-19.6.

(Authority: 20 U.S.C. 1221e-3 and 3474)



Sec. 75.611  Avoidance of flood hazards.

    In planning the construction, a grantee shall, in accordance with 
the provisions of Executive Order 11988 of February 10, 1978 (43 FR 
6030) and rules and regulations that may be issued by the Secretary to 
carry out those provisions:
    (a) Evaluate flood hazards in connection with the construction; and
    (b) As far as practicable, avoid uneconomic, hazardous, or 
unnecessary use of flood plains in connection with the construction.

(Authority: 20 U.S.C. 1221e-3 and 3474)

[[Page 136]]



Sec. 75.612  Supervision and inspection by the grantee.

    A grantee shall maintain competent architectural engineering 
supervision and inspection at the construction site to insure that the 
work conforms to the approved drawings and specifications.

(Authority: 20 U.S.C. 1221e-3 and 3474)



Sec. 75.613  Relocation assistance by the grantee.

    A grantee is subject to the regulations on relocation assistance and 
real property acquisition in 34 CFR part 15.

(Authority: 20 U.S.C. 1221e-3 and 3474)



Sec. 75.614  Grantee must have operational funds.

    A grantee shall insure that, when construction is completed, 
sufficient funds will be available for effective operation and 
maintenance of the facilities.

(Authority: 20 U.S.C. 1221e-3 and 3474)



Sec. 75.615  Operation and maintenance by the grantee.

    A grantee shall operate and maintain the facilities in accordance 
with applicable Federal, State, and local requirements.

(Authority: 20 U.S.C. 1221e-3 and 3474)



Sec. 75.616  Energy conservation.

    (a) To the extent feasible, a grantee shall design and construct 
facilities to maximize the efficient use of energy.
    (b) The following standards of the American Society of Heating, 
Refrigerating, and Air Conditioning Engineers (ASHRAE) are incorporated 
by reference in this section:
    (1) ASHRAE-90 A-1980 (Sections 1-9).
    (2) ASHRAE-90 B-1975 (Sections 10-11).
    (3) ASHRAE-90 C-1977 (Section 12).

Incorporation by reference of these provisions has been approved by the 
Director of the Office of the Federal Register pursuant to the 
Director's authority under 5 U.S.C. 552 (a) and 1 CFR part 51. The 
incorporated document is on file at the Department of Education, Grants 
and Contracts Service, rm. 3636 ROB-3, 400 Maryland Avenue, SW., 
Washington, DC 20202-4700 or at the National Archives and Records 
Administration (NARA). For information on the availability of this 
material at NARA, call 202-741-6030, or go to: http://www.archives.gov/
federal_register/code_of_federal_regulations/ibr_locations.html. These 
standards may be obtained from the publication sales department at the 
American Society of Heating, Refrigerating, and Air Conditioning 
Engineers, Inc., 1791 Tullie Circle, NE., Atlanta, Georgia 30329.
    (c) A grantee shall comply with ASHRAE standards listed in paragraph 
(b) of this section in designing and constructing facilities built with 
project funds.

(Authority: 20 U.S.C. 1221e-3 and 3474, 42 U.S.C. 8373(b), and E.O. 
12185)

[57 FR 30339, July 8, 1992, as amended at 69 FR 18803, Apr. 9, 2004]



Sec. 75.617  Compliance with the Coastal Barrier Resources Act.

    A recipient may not use, within the Coastal Barrier Resources 
System, funds made available under a program administered by the 
Secretary for any purpose prohibited by 31 U.S.C. chapter 55 (sections 
3501-3510).

(Authority: 20 U.S.C. 1221e-3 and 3474, 31 U.S.C. 3504, 3505)

[57 FR 30339, July 8, 1992]

                         Equipment and Supplies

    Cross Reference:  See 2 CFR 200.311, Real property; 200.313, 
Equipment; 200.314, Supplies; and 200.59, Intangible property; and 
200.315, Intangible property.



Sec. 75.618  Charges for use of equipment or supplies.

    A grantee may not charge students or school personnel for the 
ordinary use of equipment or supplies purchased with grant funds.

(Authority: 20 U.S.C. 1221e-3 and 3474)

                       Publications and Copyrights



Sec. 75.620  General conditions on publication.

    (a) Content of materials. Subject to any specific requirements that 
apply to its grant, a grantee may decide the format and content of 
project materials

[[Page 137]]

that it publishes or arranges to have published.
    (b) Required statement. The grantee shall ensure that any 
publication that contains project materials also contains the following 
statements:

    The contents of this (insert type of publication; e.g., book, 
report, film) were developed under a grant from the Department of 
Education. However, those contents do not necessarily represent the 
policy of the Department of Education, and you should not assume 
endorsement by the Federal Government.

(Authority: 20 U.S.C. 1221e-3 and 3474)

[45 FR 22497, Apr. 3, 1980. Redesignated at 45 FR 77368, Nov. 21, 1980, 
as amended at 45 FR 86297, Dec. 30, 1980]



Sec. 75.621  [Reserved]



Sec. 75.622  Definition of ``project materials.''

    As used in Secs. 75.620-75.621, ``project materials'' means a 
copyrightable work developed with funds from a grant of the Department.

(Authority: 20 U.S.C. 1221e-3 and 3474)

[57 FR 30339, July 8, 1992]

                         Inventions and Patents

    Cross Reference:  See 2 CFR 200.307, Program income.



Sec. 75.626  Show Federal support; give papers to vest title.

    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 and 3474)

[45 FR 22497, Apr. 3, 1980. Redesignated at 45 FR 77368, Nov. 21, 1980, 
as amended at 45 FR 86297, Dec. 30, 1980; 57 FR 30339, July 8, 1992]

                 Other Requirements for Certain Projects

    Cross Reference: See 2 CFR 200.302, Financial management, and 
200.326, Contract provisions.



Sec. 75.650  Participation of students enrolled in private schools.

    If the authorizing statute for a program requires a grantee to 
provide for participation by students enrolled in private schools, the 
grantee shall provide a genuine opportunity for equitable participation 
in accordance with the requirements that apply to subgrantees under 34 
CFR 76.650-76.662.

(Authority: 20 U.S.C. 1221e-3 and 3474)



Sec. 75.681  Protection of human research subjects.

    If a grantee uses a human subject in a research project, the grantee 
shall protect the person from physical, psychological, or social injury 
resulting from the project.

(Authority: 20 U.S.C. 1221e-3 and 3474)

    Cross Reference: See 34 CFR part 97--Protection of Human Subjects.



Sec. 75.682  Treatment of animals.

    If a grantee uses an animal in a project, the grantee shall provide 
the animal with proper care and humane treatment in accordance with the 
Animal Welfare Act of 1970.

(Authority: 20 U.S.C. 1221e-3 and 3474)



Sec. 75.683  Health or safety standards for facilities.

    A grantee shall comply with any Federal health or safety 
requirements that apply to the facilities that the grantee uses for the 
project.

(Authority: 20 U.S.C. 1221e-3 and 3474)



  Subpart F_What Are the Administrative Responsibilities of a Grantee?

                 General Administrative Responsibilities



Sec. 75.700  Compliance with statutes, regulations, and applications.

    A grantee shall comply with applicable statutes, regulations, and 
approved applications, and shall use Federal funds in accordance with 
those statutes, regulations, and applications.

(Authority: 20 U.S.C. 1221e-3 and 3474)

[[Page 138]]



Sec. 75.701  The grantee administers or supervises the project.

    A grantee shall directly administer or supervise the administration 
of the project.

(Authority: 20 U.S.C. 1221e-3 and 3474)



Sec. 75.702  Fiscal control and fund accounting procedures.

    A grantee shall use fiscal control and fund accounting procedures 
that insure proper disbursement of, and accounting for, Federal funds as 
required in 2 CFR part 200, subpart D--Post Federal Award Requirements.

(Authority: 20 U.S.C. 1221e-3 and 3474)

[79 FR 76093, Dec. 19, 2014]



Sec. 75.703  Obligation of funds during the grant period.

    A grantee may use grant funds only for obligations it makes during 
the grant period.

(Authority: 20 U.S.C. 1221e-3 and 3474)



Sec. 75.707  When obligations are made.

    The following table shows when a grantee makes obligations for 
various kinds of property and services.

------------------------------------------------------------------------
        If the obligation is for--            The obligation is made--
------------------------------------------------------------------------
(a) Acquisition of real or personal         On the date the grantee
 property.                                   makes a binding written
                                             commitment to acquire the
                                             property.
(b) Personal services by an employee of     When the services are
 the grantee.                                performed.
(c) Personnal services by a contractor who  On the date on which the
 is not an employee of the grantee.          grantee makes a binding
                                             written commitment to
                                             obtain the services.
(d) Performance of work other than          On the date on which the
 personal services.                          grantee makes a binding
                                             written commitment to
                                             obtain the work.
(e) Public utility services...............  When the grantee receives
                                             the services.
(f) Travel................................  When the travel is taken.
(g) Rental of real or personal property...  When the grantee uses the
                                             property.
(h) A pre-agreement cost that was properly  On the first day of the
 approved by the Secretary under the cost    project period.
 principles in 2 CFR part 200, Subpart E--
 Cost Principles.
------------------------------------------------------------------------


(Authority: 20 U.S.C. 1221e-3 and 3474)

[45 FR 22497, Apr. 3, 1980. Redesignated at 45 FR 77368, Nov. 21, 1980, 
as amended at 57 FR 30340, July 8, 1992; 79 FR 76093, Dec. 19, 2014]



Sec. 75.708  Subgrants.

    (a) A grantee may not make a subgrant under a program covered by 
this part unless authorized by statute or by paragraph (b) of this 
section.
    (b) The Secretary may, through an announcement in the Federal 
Register, authorize subgrants when necessary to meet the purposes of a 
program. In this announcement, the Secretary will--
    (1) Designate the types of entities, e.g., State educational 
agencies, local educational agencies, institutions of higher education, 
and nonprofit organizations, to which subgrants can be awarded; and
    (2) Indicate whether subgrants can be made to entities identified in 
an approved application or, without regard to whether the entity is 
identified in an approved application, have to be selected through a 
competitive process set out in subgranting procedures established by the 
grantee.
    (c) If authorized under paragraph (b) of this section, a subgrant is 
allowed if it will be used by that entity to directly carry out project 
activities described in that application.
    (d) The grantee, in awarding subgrants under paragraph (b) of this 
section, must--
    (1) Ensure that subgrants are awarded on the basis of an approved 
budget that is consistent with the grantee's approved application and 
all applicable Federal statutory, regulatory, and other requirements;
    (2) Ensure that every subgrant includes any conditions required by 
Federal statute and executive orders and their implementing regulations; 
and
    (3) Ensure that subgrantees are aware of requirements imposed upon 
them by Federal statute and regulation, including the Federal anti-
discrimination laws enforced by the Department.
    (e) A grantee may contract for supplies, equipment, construction, 
and other services, in accordance with 2 CFR part 200, subpart D--Post 
Federal

[[Page 139]]

Award Requirements (2 CFR 200.317-200.326, Procurement Standards).

(Authority: 20 U.S.C. 1221e-3 and 3474)

[45 FR 22497, Apr. 3, 1980. Redesignated at 45 FR 77368, Nov. 21, 1980, 
as amended at 52 FR 27804, July 24, 1987; 64 FR 50392, Sept. 16, 1999; 
78 FR 49534, Aug. 13, 2013; 79 FR 76093, Dec. 19, 2014]



Sec. 75.712  Beneficiary protections: Written notice.

    (a) A faith-based organization that receives a grant, subgrant, or 
contract under a program of the Department supported in whole or in part 
by direct Federal financial assistance must give written notice to a 
beneficiary or prospective beneficiary of certain protections. This 
notice must state that:
    (1) The organization may not discriminate against a beneficiary or 
prospective beneficiary on the basis of religion or religious belief, a 
refusal to hold a religious belief, or refusal to attend or participate 
in a religious practice;
    (2) The organization may not require a beneficiary to attend or 
participate in any explicitly religious activities that are offered by 
the organization, and any participation by the beneficiaries in such 
activities must be purely voluntary;
    (3) The organization must separate in time or location any privately 
funded explicitly religious activities from activities supported by 
direct Federal financial assistance;
    (4) If a beneficiary or prospective beneficiary objects to the 
religious character of the organization, the organization will undertake 
reasonable efforts to identify and refer the beneficiary to an 
alternative provider to which the beneficiary has no objection; and
    (5) A beneficiary or prospective beneficiary may report a violation 
of these protections to, or file a written complaint regarding a denial 
of services or benefits with, the subgrantee, grantee, or Department 
that made the award under which the violation or denial occurred.
    (b)(1) A faith-based organization that receives a grant, subgrant, 
or contract under a program of the Department must provide beneficiaries 
or prospective beneficiaries with the written notice required under 
paragraph (a) of this section prior to the time they enroll in or 
receive services from the organization.
    (2) When the nature of the services provided or exigent 
circumstances make it impracticable to provide the written notice in 
advance of the actual services, the organization must advise 
beneficiaries of their protections at the earliest available 
opportunity.
    (c) The notice that a faith-based organization must use to notify 
beneficiaries or prospective beneficiaries of their rights under 
paragraph (a) of this section is specified in appendix A to this part.

(Authority: 20 U.S.C. 1221e-3 and 3474, E.O. 13559)

[Approved by the Office of Management and Budget under control number 
1895-0001]

[81 FR 19407, Apr. 4, 2016]



Sec. 75.713  Beneficiary protections: Referral requirements.

    (a) If a beneficiary or prospective beneficiary of a program of the 
Department supported in whole or in part by direct Federal financial 
assistance objects to the religious character of a faith-based 
organization that provides services under the program, that organization 
must promptly undertake reasonable efforts to identify and refer the 
beneficiary or prospective beneficiary to an alternative provider to 
which the beneficiary or prospective beneficiary has no objection.
    (b)(1) A faith-based organization may satisfy the requirement in 
paragraph (a) of this section by referring a beneficiary or prospective 
beneficiary to another faith-based organization if the beneficiary or 
prospective beneficiary does not object to that provider.
    (2) If the beneficiary or prospective beneficiary requests a secular 
provider, and one is available, the faith-based organization must make a 
referral to that provider.
    (c) The faith-based organization must make a referral to an 
alternative provider that--

[[Page 140]]

    (1) Is in reasonable geographic proximity to the location where the 
beneficiary or prospective beneficiary is receiving or would receive 
services (except for services provided by telephone, internet, or 
similar means);
    (2) Offers services that are similar in substance and quality to 
those offered by the organization; and
    (3) Has the capacity to accept additional beneficiaries.
    (d)(1) When a faith-based organization makes a referral to an 
alternative provider, the organization must maintain a record of the 
referral in its grant records, including the date of the referral, the 
name of the alternative provider, its address, and contact information 
for the alternative provider;
    (2) When a faith-based organization determines that it is unable to 
identify an alternative provider, the organization must promptly notify 
the subgrantee, grantee, or Department that made the award under which 
the referral could not be made. If the organization is unable to 
identify an alternative provider, the subgrantee, grantee, or Department 
that made the award under which the referral could not be made must 
determine whether there is any other suitable alternative provider to 
which the beneficiary or prospective beneficiary may be referred. If the 
entity that made the award under which the referral could not be made 
cannot make a referral, that entity must promptly notify the grantee or 
the Department, as appropriate, and the grantee or the Department must 
determine whether a suitable referral can be made.

(Authority: 20 U.S.C. 1221e-3 and 3474, E.O. 13559)

[Approved by the Office of Management and Budget under control number 
1895-0001]

[81 FR 19407, Apr. 4, 2016]



Sec. 75.714  Subgrants, contracts, and other agreements with
faith-based organizations.

    If a grantee under a discretionary grant program of the Department 
has the authority under the grant to select a private organization to 
provide services supported by direct Federal financial assistance under 
the program by subgrant, contract, or other agreement, the grantee must 
ensure compliance with applicable Federal requirements governing 
contracts, grants, and other agreements with faith-based organizations, 
including, as applicable, Secs. 75.52, 75.532, and 75.712-75.713, 
appendix A to this part, and 2 CFR 3474.15. If the intermediary is a 
nongovernmental organization, it retains all other rights of a 
nongovernmental organization under the program's statutory and 
regulatory provisions.

(Authority: 20 U.S.C. 1221e-3 and 3474, E.O. 13559)

[81 FR 19407, Apr. 4, 2016]

                                 Reports

    Cross Reference: See 2 CFR 200.327-200.337, which appear after the 
undesignated center heading ``Performance and Financial Monitoring and 
Reporting.''



Sec. 75.720  Financial and performance reports.

    (a) This section applies to the reports required under--
    (1) 2 CFR 200.327 (Financial reporting); and
    (2) 2 CFR 200.328 (Monitoring and reporting program performance).
    (b) A grantee shall submit these reports annually, unless the 
Secretary allows less frequent reporting.
    (c) The Secretary may require a grantee to report more frequently 
than annually, as authorized under 2 CFR 200.207, Specific conditions, 
and may impose high-risk conditions in appropriate circumstances under 2 
CFR 3474.10.

(Authority: 20 U.S.C. 1221e-3 and 3474)

[79 FR 76093, Dec. 19, 2014]



Sec. 75.721  [Reserved]

                                 Records

    Cross Reference:  See 2 CFR 200.333-200.337, which follow the 
undesignated center heading ``Record Retention and Access.''



Sec. 75.730  Records related to grant funds.

    A grantee shall keep records that fully show:
    (a) The amount of funds under the grant;
    (b) How the grantee uses the funds;

[[Page 141]]

    (c) The total cost of the project;
    (d) The share of that cost provided from other sources; and
    (e) Other records to facilitate an effective audit.

(Approved by the Office of Management and Budget under control number 
1880-0513)

(Authority: 20 U.S.C. 1221e-3 and 3474)

[45 FR 22497, Apr. 3, 1980. Redesignated at 45 FR 77368, Nov. 21, 1980, 
as amended at 53 FR 49143, Dec. 6, 1988]



Sec. 75.731  Records related to compliance.

    A grantee shall keep records to show its compliance with program 
requirements.

(Authority: 20 U.S.C. 1221e-3 and 3474)



Sec. 75.732  Records related to performance.

    (a) A grantee shall keep records of significant project experiences 
and results.
    (b) The grantee shall use the records under paragraph (a) to:
    (1) Determine progress in accomplishing project objectives; and
    (2) Revise those objectives, if necessary.

(Approved by the Office of Management and Budget under control number 
1880-0513)

(Authority: 20 U.S.C. 1221e-3 and 3474)

    Cross Reference: See 2 CFR 200.308, Revision of budget and program 
plans.

[45 FR 22497, Apr. 3, 1980. Redesignated at 45 FR 77368, Nov. 21, 1980, 
as amended at 53 FR 49143, Dec. 6, 1988]



Sec. 75.733  [Reserved]

                                 Privacy



Sec. 75.740  Protection of and access to student records; student
rights in research, experimental programs, and testing.

    (a) Most records on present or past students are subject to the 
requirements of section 444 of GEPA and its implementing regulations in 
34 CFR part 99. (Section 444 is the Family Educational Rights and 
Privacy Act of 1974.)
    (b) Under most programs administered by the Secretary, research, 
experimentation, and testing are subject to the requirements of section 
445 of GEPA and its implementing regulations at 34 CFR part 98.

(Authority: 20 U.S.C. 1221e-3, 1232g, 1232h, and 3474)

[45 FR 22497, Apr. 3, 1980. Redesignated at 45 FR 77368, Nov. 21, 1980, 
as amended at 57 FR 30340, July 8, 1992; 60 FR 46493, Sept. 6, 1995]



  Subpart G_What Procedures Does the Department Use To Get Compliance?

    Cross Reference: See 2 CFR 200.338-200.342 which follow the 
undesignated center heading ``Remedies for Noncompliance.''



Sec. 75.900  Waiver of regulations prohibited.

    (a) No official, agent, or employee of ED may waive any regulation 
that applies to a Department program, unless the regulation specifically 
provides that it may be waived.
    (b) No act or failure to act by an official, agent, or employee of 
ED can affect the authority of the Secretary to enforce regulations.

(Authority: 20 U.S.C. 1221e-3 and 3474)



Sec. 75.901  Suspension and termination.

    The Secretary may use the Office of Administrative Law Judges to 
resolve disputes that are not subject to other procedures. See, for 
cross-reference, the following:
    (a) 2 CFR 200.338 (Remedies for noncompliance).
    (b) 2 CFR 200.339 (Termination).
    (c) 2 CFR 200.340 (Notification of termination requirement).
    (d) 2 CFR 200.341 (Opportunities to object, hearings and appeals).
    (e) 2 CFR 200.342 (Effects of suspension and termination).
    (f) 2 CFR 200.344 (Post-closeout adjustments and continuing 
responsibilities).

(Authority: 20 U.S.C. 1221e-3 and 3474)

[79 FR 76093, Dec. 19, 2014]



Sec. 75.902  [Reserved]



Sec. 75.903  Effective date of termination.

    Termination is effective on the latest of:
    (a) The date of delivery to the grantee of the notice of 
termination;

[[Page 142]]

    (b) The termination date given in the notice of termination; or
    (c) The date of a final decision of the Secretary under part 81 of 
this title.

(Authority: 20 U.S.C. 1221e-3 and 3474)

[45 FR 22497, Apr. 3, 1980. Redesignated at 45 FR 77368, Nov. 21, 1980, 
as amended at 45 FR 86298, Dec. 30, 1980; 79 FR 76093, Dec. 19, 2014]



Sec. 75.910  [Reserved]



  Sec. Appendix A to Part 75--Form of Required Notice to Beneficiaries

    A faith-based organization that serves beneficiaries under a program 
funded in whole or in part by direct Federal financial assistance from 
the U.S. Department of Education must provide the following notice, or 
an accurate translation of this notice, to a beneficiary or prospective 
beneficiary of the program.

(Approved by the Office of Management and Budget under control number 
1895-0001)
NOTICE OF BENEFICIARY RIGHTS
Name of Organization:
Name of Program:
Contact Information for Program Staff: (name, phone number, and email 
address, if appropriate):
    Because this program is supported in whole or in part by direct 
Federal financial assistance from the U.S. Department of Education, we 
are required to let you know that--
    (1) We may not discriminate against you on the basis of religion or 
religious belief, a refusal to hold a religious belief, or refusal to 
attend or participate in a religious practice;
    (2) We may not require you to attend or participate in any 
explicitly religious activities that are offered by us, and any 
participation by you in such activities must be purely voluntary;
    (3) We must separate in time or location any privately funded 
explicitly religious activities from activities supported under this 
[insert the grant, subgrant, or contract name and identifying number of 
this award to the faith-based organization] by direct Federal financial 
assistance under this program;
    (4) If you object to the religious character of our organization, we 
will undertake reasonable efforts to identify and refer you to an 
alternative provider to which you have no objection; however, we cannot 
guarantee that, in every instance, an alternative provider will be 
available; and
    (5) You may report violations of these protections to, or file a 
written complaint regarding a denial of services or benefits under this 
award with, [Insert the name of the entity that awarded the grant, 
subgrant, or contract under which the violation occurred].
    We must give you this written notice before you enroll in our 
program or receive services from the program.
________________________________________________________________________
BENEFICIARY REFERRAL REQUEST
    If you object to receiving services from us based on the religious 
character of our organization, please complete this form and return it 
to the program contact identified above. If you object, we will make 
reasonable efforts to refer you to another service provider. With your 
consent, we will follow up with you or the organization to which you 
were referred to determine whether you contacted that organization.
Please check if applicable:
( ) I want to be referred to another service provider.
If you checked above that you wish to be referred to another service 
provider, please check one of the following:
( ) Please follow up with me.
    Name:
    Best way to reach me: (phone/address/email):
( ) Please follow up with the service provider to which I was referred.
( ) Please do not follow up.
--End of Form--

(Authority: 20 U.S.C. 1221e-3 and 3474, E.O. 13559)

[81 FR 19408, Apr. 4, 2016]



PART 76_STATE-ADMINISTERED PROGRAMS--Table of Contents



                            Subpart A_General

          Regulations that Apply to State-Administered Programs

Sec.
76.1  Programs to which part 76 applies.
76.2  Exceptions in program regulations to part 76.

                   Eligibility for a Grant or Subgrant

76.50  Statutes determine eligibility and whether subgrants are made.
76.51  A State distributes funds by formula or competition.
76.52  Eligibility of faith-based organizations for a subgrant and 
          nondiscrimination against those organizations.

                Subpart B_How a State Applies for a Grant

                      State Plans and Applications

76.100  Effect of this subpart.
76.101  The general State application.
76.102  Definition of ``State plan'' for part 76.
76.103  Multi-year State plans.

[[Page 143]]

76.104  A State shall include certain certifications in its State plan.
76.106  State documents are public information.

            Consolidated Grant Applications for Insular Areas

76.125  What is the purpose of these regulations?
76.126  What regulations apply to the consolidated grant applications 
          for insular areas?
76.127  What is the purpose of a consolidated grant?
76.128  What is a consolidated grant?
76.129  How does a consolidated grant work?
76.130  How are consolidated grants made?
76.131  How does an insular area apply for a consolidated grant?
76.132  What assurances must be in a consolidated grant application?
76.133  What is the reallocation authority?
76.134  What is the relationship between consolidated and non-
          consolidated grants?
76.135  Are there any requirements for matching funds?
76.136  Under what programs may consolidated grant funds be spent?
76.137  How may carryover funds be used under the consolidated grant 
          application?

                               Amendments

76.140  Amendments to a State plan.
76.141  An amendment requires the same procedures as the document being 
          amended.
76.142  An amendment is approved on the same basis as the document being 
          amended.

                Subpart C_How a Grant Is Made to a State

                Approval or Disapproval by the Secretary

76.201  A State plan must meet all statutory and regulatory 
          requirements.
76.202  Opportunity for a hearing before a State plan is disapproved.
76.235  The notification of grant award.

               Allotments and Reallotments of Grant Funds

76.260  Allotments are made under program statute or regulations.
76.261  Realloted funds are part of a State's grant.

           Subpart D_How To Apply to the State for a Subgrant

76.300  Contact the State for procedures to follow.
76.301  Local educational agency general application.
76.302  The notice to the subgrantee.
76.303  Joint applications and projects.
76.304  Subgrantee shall make subgrant application available to the 
          public.

            Subpart E_How a Subgrant Is Made to an Applicant

76.400  State procedures for reviewing an application.
76.401  Disapproval of an application--opportunity for a hearing.

 Subpart F_What Conditions Must Be Met by the State and Its Subgrantees?

                            Nondiscrimination

76.500  Federal statutes and regulations on nondiscrimination.

                             Allowable costs

76.530  General cost principles.
76.532  Use of funds for religion prohibited.
76.533  Acquisition of real property; construction.
76.534  Use of tuition and fees restricted.

                           Indirect Cost Rates

76.560  General indirect cost rates; exceptions.
76.561  Approval of indirect cost rates.
76.563  Restricted indirect cost rate--programs covered.
76.564  Restricted indirect cost rate--formula.
76.565  General management costs--restricted rate.
76.566  Fixed costs--restricted rate.
76.567  Other expenditures--restricted rate.
76.568  Occupancy and space maintenance costs--restricted rate.
76.569  Using the restricted indirect cost rate.
76.580  Coordination with other activities.

                               Evaluation

76.591  Federal evaluation--cooperation by a grantee.
76.592  Federal evaluation--satisfying requirement for State or 
          subgrantee evaluation.

                              Construction

76.600  Where to find construction regulations.

          Participation of Students Enrolled in Private Schools

76.650  Private schools; purpose of Secs. 76.651-76.662.
76.651  Responsibility of a State and a subgrantee.
76.652  Consultation with representatives of private school students.

[[Page 144]]

76.653  Needs, number of students, and types of services.
76.654  Benefits for private school students.
76.655  Level of expenditures for students enrolled in private schools.
76.656  Information in an application for a subgrant.
76.657  Separate classes prohibited.
76.658  Funds not to benefit a private school.
76.659  Use of public school personnel.
76.660  Use of private school personnel.
76.661  Equipment and supplies.
76.662  Construction.

                          Procedures for Bypass

76.670  Applicability and filing requirements.
76.671  Notice by the Secretary.
76.672  Bypass procedures.
76.673  Appointment and functions of a hearing officer.
76.674  Hearing procedures.
76.675  Posthearing procedures.
76.676  Judicial review of a bypass action.
76.677  Continuation of a bypass.

                 Other Requirements for Certain Programs

76.681  Protection of human subjects.
76.682  Treatment of animals.
76.683  Health or safety standards for facilities.

Subpart G_What Are the Administrative Responsibilities of the State and 
                            Its Subgrantees?

                 General Administrative Responsibilities

76.700  Compliance with statutes, regulations, State plan, and 
          applications.
76.701  The State or subgrantee administers or supervises each project.
76.702  Fiscal control and fund accounting procedures.
76.703  When a State may begin to obligate funds.
76.704  New State plan requirements that must be addressed in a State 
          plan.
76.707  When obligations are made.
76.708  When certain subgrantees may begin to obligate funds.
76.709  Funds may be obligated during a ``carryover period.''
76.710  Obligations made during a carryover period are subject to 
          current statutes, regulations, and applications.
76.711  Requesting funds by CFDA number.
76.712  Beneficiary protections: Written notice.
76.713  Beneficiary protections: Referral requirements.
76.714  Subgrants, contracts, and other agreements with faith-based 
          organizations.

                                 Reports

76.720  State reporting requirements.
76.722  Subgrantee reporting requirements.

                                 Records

76.730  Records related to grant funds.
76.731  Records related to compliance.

                                 Privacy

76.740  Protection of and access to student records; student rights in 
          research, experimental programs, and testing.

                 Use of Funds by States and Subgrantees

76.760  More than one program may assist a single activity.
76.761  Federal funds may pay 100 percent of cost.

                  State Administrative Responsibilities

76.770  A State shall have procedures to ensure compliance.
76.783  State educational agency action--subgrantee's opportunity for a 
          hearing.

Subpart H_How Does a State or Local Educational Agency Allocate Funds to 
                            Charter Schools?

                                 General

76.785  What is the purpose of this subpart?
76.786  What entities are governed by this subpart?
76.787  What definitions apply to this subpart?

               Responsibilities for Notice and Information

76.788  What are a charter school LEA's responsibilities under this 
          subpart?
76.789  What are an SEA's responsibilities under this subpart?

            Allocation of Funds by State Educational Agencies

76.791  On what basis does an SEA determine whether a charter school LEA 
          that opens or significantly expands its enrollment is eligible 
          to receive funds under a covered program?
76.792  How does an SEA allocate funds to eligible charter school LEAs 
          under a covered program in which the SEA awards subgrants on a 
          formula basis?
76.793  When is an SEA required to allocate funds to a charter school 
          LEA under this subpart?
76.794  How does an SEA allocate funds to charter school LEAs under a 
          covered program in which the SEA awards subgrants on a 
          discretionary basis?

                               Adjustments

76.796  What are the consequences of an SEA allocating more or fewer 
          funds to a charter school LEA under a covered program than the 
          amount for which the charter

[[Page 145]]

          school LEA is eligible when the charter school LEA actually 
          opens or significantly expands its enrollment?
76.797  When is an SEA required to make adjustments to allocations under 
          this subpart?

       Applicability of This Subpart to Local Educational Agencies

76.799  Do the requirements in this subpart apply to LEAs?

   Subpart I_What Procedures Does the Secretary Use To Get Compliance?

76.900  Waiver of regulations prohibited.
76.901  Office of Administrative Law Judges.
76.902  Judicial review.
76.910  Cooperation with audits.

    Authority: 20 U.S.C. 1221e-3 and 3474, unless otherwise noted.

    Source: 45 FR 22517, Apr. 3, 1980, unless otherwise noted. 
Redesignated at 45 FR 77368, Nov. 21, 1980.



                            Subpart A_General

          Regulations That Apply to State-Administered Programs



Sec. 76.1  Programs to which part 76 applies.

    (a) The regulations in part 76 apply to each State-administered 
program of the Department.
    (b) If a State formula grant program does not have implementing 
regulations, the Secretary implements the program under the authorizing 
statute and, to the extent consistent with the authorizing statute, 
under the General Education Provisions Act and the regulations in this 
part. For the purposes of this part, the term State formula grant 
program means a program whose authorizing statute or implementing 
regulations provide a formula for allocating program funds among 
eligible States.

(Authority: 20 U.S.C. 1221e-3, 3474, and 6511(a))

[45 FR 22517, Apr. 3, 1980. Redesignated at 45 FR 77368, Nov. 21, 1980, 
as amended at 45 FR 84059, Dec. 22, 1980; 50 FR 29330, July 18, 1985; 52 
FR 27804, July 24, 1987; 54 FR 21776, May 19, 1989; 55 FR 14816, Apr. 
18, 1990]



Sec. 76.2  Exceptions in program regulations to part 76.

    If a program has regulations that are not consistent with part 76, 
the implementing regulations for that program identify the sections of 
part 76 that do not apply.

(Authority: 20 U.S.C. 1221e-3, 3474, and 6511(a))

[45 FR 22517, Apr. 3, 1980. Redesignated at 45 FR 77368, Nov. 21, 1980, 
as amended at 54 FR 21776, May 19, 1989]

                   Eligibility for a Grant or Subgrant



Sec. 76.50  Statutes determine eligibility and whether subgrants
are made.

    (a) Under a program covered by this part, the Secretary makes a 
grant:
    (1) To the State agency designated by the authorizing statute for 
the program; or
    (2) To the State agency designated by the State in accordance with 
the authorizing statute.
    (b) The authorizing statute determines the extent to which a State 
may:
    (1) Use grant funds directly; and
    (2) Make subgrants to eligible applicants.
    (c) The regulations in part 76 on subgrants apply to a program only 
if subgrants are authorized under that program.
    (d) The authorizing statute determines the eligibility of an 
applicant for a subgrant.

(Authority: 20 U.S.C. 1221e-3, 3474, and 6511(a))

[45 FR 22517, Apr. 3, 1980. Redesignated at 45 FR 77368, Nov. 21, 1980, 
as amended at 52 FR 27804, July 24, 1987; 54 FR 21776, May 19, 1989]



Sec. 76.51  A State distributes funds by formula or competition.

    If a program statute authorizes a State to make subgrants, the 
statute:
    (a) Requires the State to use a formula to distribute funds;
    (b) Gives the State discretion to select subgrantees through a 
competition among the applicants or through some other procedure; or
    (c) Allows some combination of these procedures.

(Authority: 20 U.S.C. 1221e-3, 3474, and 6511(a))

[45 FR 22517, Apr. 3, 1980. Redesignated at 45 FR 77368, Nov. 21, 1980, 
as amended at 54 FR 21776, May 19, 1989]

[[Page 146]]



Sec. 76.52  Eligibility of faith-based organizations for a subgrant
and nondiscrimination against those organizations.

    (a)(1) A faith-based organization is eligible to apply for and to 
receive a subgrant under a program of the Department on the same basis 
as any other private organization, with respect to programs for which 
such other organizations are eligible.
    (2) In the selection of subgrantees and contractors, States may not 
discriminate for or against a private organization on the basis of the 
organization's religious character or affiliation and must ensure that 
all decisions about subgrants are free from political interference, or 
even the appearance of such interference, and are made on the basis of 
merit, not on the basis of religion or religious belief or a lack 
thereof.
    (b) The provisions of Sec. 76.532 apply to a faith-based 
organization that receives a subgrant from a State under a State-
administered program of the Department.
    (c)(1) A private organization that engages in explicitly religious 
activities, such as religious worship, instruction, or proselytization, 
must offer those activities separately in time or location from any 
programs or services supported by a subgrant from a State under a State-
administered program of the Department, and attendance or participation 
in any such explicitly religious activities by beneficiaries of the 
programs and services supported by the subgrant must be voluntary.
    (2) The limitations on explicitly religious activities under 
paragraph (c)(1) of this section do not apply to a faith-based 
organization that provides services to a beneficiary under a program 
supported only by ``indirect Federal financial assistance.''
    (3) For purposes of 2 CFR 3474.15, 34 CFR 76.52, 76.712, 76.713, and 
76.714, the following definitions apply:
    (i) Direct Federal financial assistance means that the Department, 
grantee, or subgrantee selects a provider and either purchases services 
from that provider (such as through a contract) or awards funds to that 
provider (such as through a grant, subgrant, or cooperative agreement) 
to carry out services under a program of the Department. Federal 
financial assistance shall be treated as direct unless it meets the 
definition of ``indirect Federal financial assistance.''
    (ii) Indirect Federal financial assistance means that the choice of 
a service provider under a program of the Department is placed in the 
hands of the beneficiary, and the cost of that service is paid through a 
voucher, certificate, or other similar means of government-funded 
payment. Federal financial assistance provided to an organization is 
``indirect'' under this definition if--
    (A) The government program through which the beneficiary receives 
the voucher, certificate, or other similar means of government-funded 
payment is neutral toward religion;
    (B) The organization receives the assistance as the result of the 
decision of the beneficiary, not a decision of the government; and
    (C) The beneficiary has at least one adequate secular option for use 
of the voucher, certificate, or other similar means of government-funded 
payment.
    Note to paragraph (c)(3): The definitions of ``direct Federal 
financial assistance'' and ``indirect Federal financial assistance'' do 
not change the extent to which an organization is considered a 
``recipient'' of ``Federal financial assistance'' as those terms are 
defined under 34 CFR parts 100, 104, 106, and 110.
    (d)(1) A faith-based organization that applies for or receives a 
subgrant from a State under a State-administered program of the 
Department may retain its independence, autonomy, right of expression, 
religious character, and authority over its governance.
    (2) A faith-based organization may, among other things--
    (i) Retain religious terms in its name;
    (ii) Continue to carry out its mission, including the definition, 
development, practice, and expression of its religious beliefs;
    (iii) Use its facilities to provide services without removing or 
altering religious art, icons, scriptures, or other symbols from these 
facilities;

[[Page 147]]

    (iv) Select its board members and otherwise govern itself on a 
religious basis; and
    (v) Include religious references in its mission statement and other 
chartering or governing documents.
    (e) A private organization that receives any Federal financial 
assistance under a program of the Department shall not discriminate 
against a beneficiary or prospective beneficiary in the provision of 
program services or in outreach activities on the basis of religion or 
religious belief, a refusal to hold a religious belief, or refusal to 
attend or participate in a religious practice. However, an organization 
that participates in a program funded by indirect financial assistance 
need not modify its program activities to accommodate a beneficiary who 
chooses to expend the indirect aid on the organization's program.
    (f) If a State or subgrantee contributes its own funds in excess of 
those funds required by a matching or grant agreement to supplement 
Federally funded activities, the State or subgrantee has the option to 
segregate those additional funds or commingle them with the funds 
required by the matching requirements or grant agreement. However, if 
the additional funds are commingled, this section applies to all of the 
commingled funds.
    (g) A religious organization's exemption from the Federal 
prohibition on employment discrimination on the basis of religion, in 
section 702(a) of the Civil Rights Act of 1964, 42 U.S.C. 2000e-1, is 
not forfeited when the organization receives financial assistance from 
the Department.


(Authority: 20 U.S.C. 1221e-3, 3474, and 6511(a))

(Authority: 20 U.S.C. 1221e-3, 3474, and 6511(a))

[45 FR 22517, Apr. 3, 1980. Redesignated at 45 FR 77368, Nov. 21, 1980, 
as amended at 69 FR 31711, June 4, 2004; 81 FR 19408, Apr. 4, 2016]



                Subpart B_How a State Applies for a Grant

                      State Plans and Applications



Sec. 76.100  Effect of this subpart.

    This subpart establishes general requirements that a State must meet 
to apply for a grant under a program covered by this part. Additional 
requirements are in the authorizing statute and the implementing 
regulations for the program.

(Authority: 20 U.S.C. 1221e-3 and 3474)

[52 FR 27804, July 24, 1987]



Sec. 76.101  The general State application.

    A State that makes subgrants to local educational agencies under a 
program subject to this part shall have on file with the Secretary a 
general application that meets the requirements of section 441 of the 
General Education Provisions Act.

(Authority: 20 U.S.C. 1221e-3, 1232d, and 3474)

[52 FR 27804, July 24, 1987, as amended at 60 FR 46493, Sept. 6, 1995]



Sec. 76.102  Definition of ``State plan'' for part 76.

    As used in this part, State plan means any of the following 
documents:

----------------------------------------------------------------------------------------------------------------
               Document                          Program             Authorizing statute       Principal Office
----------------------------------------------------------------------------------------------------------------
State plan............................  Assistance to States for  Part B (except section     OSERS
                                         Education of              619), Individuals with
                                         Handicapped Children.     Disabilities Education
                                                                   Act (20 U.S.C. 1411-
                                                                   1420).
Application...........................  Preschool Grants........  Section 619, Individuals   OSERS
                                                                   with Disabilities
                                                                   Education Act (20 U.S.C.
                                                                   1419).
Application...........................  Handicapped Infants and   Part H, Individuals with   OSERS
                                         Toddlers.                 Disabilities Education
                                                                   Act (20 U.S.C. 1471-
                                                                   1485).
Application or written request for      Client Assistance         Section 112,               OSERS
 assistance.                             Program.                  Rehabilitation Act of
                                                                   1973 (29 U.S.C. 732).
Application...........................  Removal of Architectural  Section 607, Individuals   OSERS
                                         Barriers to the           with Disabilities
                                         Handicapped Program.      Education Act (20 U.S.C.
                                                                   1406).
State plan............................  State Vocational          Title I, Parts A-C,        OSERS
                                         Rehabilitation Services   Rehabilitation Act of
                                         Program.                  1973 (29 U.S.C. 720-741).

[[Page 148]]

 
State plan supplement.................  State Supported           Title VI, Part C,          OSERS
                                         Employment Services       Rehabilitation Act of
                                         Program.                  1973 (29 U.S.C. 795j-
                                                                   795r).
State plan............................  State Independent Living  Title VII, Part A,         OSERS
                                         Services Program.         Rehabilitation Act of
                                                                   1973 (29 U.S.C. 796-
                                                                   796d).
State plan............................  State Vocational          Title I, Part B, Carl D.   OVAE
                                         Education Program.        Perkins Vocational
                                                                   Education Act (20 U.S.C.
                                                                   2321-2325).
State plan and application............  State-Administered Adult  Section 341, Adult         OVAE
                                         Education Program.        Education Act (20 U.S.C.
                                                                   1206).
State plan............................  Even Start Family         Title I, Chapter 1, Part   OESE
                                         Literacy Program.         B of the Elementary and
                                                                   Secondary Education Act
                                                                   of 1965 (20 U.S.C. 2741-
                                                                   2749).
State application.....................  State Grants for          Title II, Part A,          OESE
                                         Strengthening             Elementary and Secondary
                                         Instruction in            Education Act of 1965,
                                         Mathematics and Science.  as amended (20 U.S.C.
                                                                   2981-2993).
State application.....................  Federal, State and Local  Title I, Chapter 2,        OESE
                                         Partnership for           Elementary and Secondary
                                         Educational Improvement.  Education Act of 1965,
                                                                   as amended (20 U.S.C.
                                                                   2911-2952 and 2971-2976).
State plan or application.............  Migrant Education         Sections 1201, 1202,       OESE
                                         Program.                  Chapter 1, Title I,
                                                                   Elementary and Secondary
                                                                   Education Act of 1965,
                                                                   as amended (20 U.S.C.
                                                                   2781 and 2782).
Application...........................  State Student Incentive   Section 415C, Higher       OPE
                                         Grant Program.            Education Act of 1965
                                                                   (20 U.S.C. 1070c-2).
Application...........................  Paul Douglas Teacher      Section 553, Higher        OPE
                                         Scholarship Program.      Education Act of 1965
                                                                   (20 U.S.C. 1111b).
Basic State plan, long-range program,   The Library Services and  Library Services and       OERI
 and annual program.                     Construction Act State-   Construction Act (20
                                         Administered Program.     U.S.C. 351-355e-3).
Application...........................  Emergency Immigrant       Emergency Immigrant        OBEMLA
                                         Education Program.        Education Act (20 U.S.C.
                                                                   3121-3130).
Application...........................  Transition Program for    Section 412(d)             OBEMLA
                                         Refugee Children.         Immigration and
                                                                   Naturalization Act (8
                                                                   U.S.C. 1522 (d)).
Any document that the authorizing       Any State-administered    Section 408(a)(1),         Dept-wide
 statute for a State-administered        program without           General Education
 program requires a State to submit to   implementing              Provisions Act and
 receive funds.                          regulations.              Section 414, Department
                                                                   of Education
                                                                   Organization Act (20
                                                                   U.S.C. 1221e-3(a)(1) and
                                                                   3474).
----------------------------------------------------------------------------------------------------------------


(Authority: 20 U.S.C. 1221e-3 and 3474)

[57 FR 30340, July 8, 1992]



Sec. 76.103  Multi-year State plans.

    (a) Beginning with fiscal year 1996, each State plan will be 
effective for a period of more than one fiscal year, to be determined by 
the Secretary or by regulations.
    (b) If the Secretary determines that the multi-year State plans 
under a program should be submitted by the States on a staggered 
schedule, the Secretary may require groups of States to submit or 
resubmit their plans in different years.
    (c) This section does not apply to:
    (1) The annual accountability report under part A of title I of the 
Vocational Education Act;
    (2) The annual programs under the Library Services and Construction 
Act;
    (3) The application under sections 141-143 of the Elementary and 
Secondary Education Act; and
    (4) The State application under section 209 of title II of the 
Education for Economic Security Act.
    (d) A State may submit an annual State plan under the Vocational 
Education Act. If a State submits an annual plan under that program, 
this section does not apply to that plan.

    Note: This section is based on a provision in the General Education 
Provisions Act (GEPA). Section 427 of the Department of Education 
Organization Act (DEOA), 20 U.S.C. 3487, provides that except to the 
extent inconsistent with the DEOA, the GEPA ``shall apply to functions 
transferred by this Act to the extent applicable on the day preceding 
the effective date of this Act.'' Although standardized nomenclature is 
used in this section to reflect the creation of the Department of 
Education, there is no intent to extend the coverage of the GEPA beyond

[[Page 149]]

that authorized under section 427 or other applicable law.

(Authority: 20 U.S.C. 1231g(a))

[45 FR 22517, Apr. 3, 1980. Redesignated at 45 FR 77368, Nov. 21, 1980, 
as amended at 45 FR 86296, Dec. 30, 1980; 50 FR 43545, Oct. 25, 1985; 60 
FR 46493, Sept. 6, 1995]



Sec. 76.104  A State shall include certain certifications in its 
State plan.

    (a) A State shall include the following certifications in each State 
plan:
    (1) That the plan is submitted by the State agency that is eligible 
to submit the plan.
    (2) That the State agency has authority under State law to perform 
the functions of the State under the program.
    (3) That the State legally may carry out each provision of the plan.
    (4) That all provisions of the plan are consistent with State law.
    (5) That a State officer, specified by title in the certification, 
has authority under State law to receive, hold, and disburse Federal 
funds made available under the plan.
    (6) That the State officer who submits the plan, specified by title 
in the certification, has authority to submit the plan.
    (7) That the agency that submits the plan has adopted or otherwise 
formally approved the plan.
    (8) That the plan is the basis for State operation and 
administration of the program.
    (b) [Reserved]

(Authority: 20 U.S.C. 1221e-3 and 3474)



Sec. 76.106  State documents are public information.

    A State shall make the following documents available for public 
inspection:
    (a) All State plans and related official materials.
    (b) All approved subgrant applications.
    (c) All documents that the Secretary transmits to the State 
regarding a program.

(Authority: 20 U.S.C. 1221e-3 and 3474)

            Consolidated Grant Applications for Insular Areas

    Authority: Title V, Pub. L. 95-134, 91 Stat. 1159 (48 U.S.C. 1469a).



Sec. 76.125  What is the purpose of these regulations?

    (a) Sections 76.125 through 76.137 of this part contain requirements 
for the submission of an application by an Insular Area for the 
consolidation of two or more grants under the programs described in 
paragraph (c) of this section.
    (b) For the purpose of Secs. 76.125-76.137 of this part the term 
Insular Area means the Virgin Islands, Guam, American Samoa, the Trust 
Territory of the Pacific Islands, or the Commonwealth of the Northern 
Mariana Islands.
    (c) The Secretary may make an annual consolidated grant to assist an 
Insular Area in carrying out one or more State-administered formula 
grant programs of the Department.

(Authority: 20 U.S.C. 1221e-3 and 3474)

[47 FR 17421, Apr. 22, 1982, as amended at 54 FR 21776, May 19, 1989; 57 
FR 30341, July 8, 1992]



Sec. 76.126  What regulations apply to the consolidated grant 
applications for insular areas?

    The following regulations apply to those programs included in a 
consolidated grant:
    (a) The regulations in Secs. 76.125 through 76.137; and
    (b) The regulations that apply to each specific program included in 
a consolidated grant for which funds are used.

(Authority: 48 U.S.C. 1469a)

[47 FR 17421, Apr. 22, 1982]



Sec. 76.127  What is the purpose of a consolidated grant?

    An Insular Area may apply for a consolidated grant for two or more 
of the programs listed in Sec. 76.125(c). This procedure is intended to:
    (a) Simplify the application and reporting procedures that would 
otherwise apply for each of the programs included in the consolidated 
grant; and
    (b) Provide the Insular Area with flexibility in allocating the 
funds under the consolidated grant to

[[Page 150]]

achieve any of the purposes to be served by the programs that are 
consolidated.

(Authority: 48 U.S.C. 1469a)

[47 FR 17421, Apr. 22, 1982]



Sec. 76.128  What is a consolidated grant?

    A consolidated grant is a grant to an Insular Area for any two or 
more of the programs listed in Sec. 76.125(c). The amount of the 
consolidated grant is the sum of the allocations the Insular Area 
receives under each of the programs included in the consolidated grant 
if there had been no consolidation.

    Example. Assume the Virgin Islands applies for a consolidated grant 
that includes programs under the Adult Education Act, Vocational 
Education Act, and Chapter 1 of the Education Consolidation and 
Improvement Act. If the Virgin Islands' allocation under the formula for 
each of these three programs is $150,000; the total consolidated grant 
to the Virgin Islands would be $450,000.

(Authority: 48 U.S.C. 1469a)

[47 FR 17421, Apr. 22, 1982]



Sec. 76.129  How does a consolidated grant work?

    (a) An Insular Area shall use the funds it receives under a 
consolidated grant to carry out, in its jurisdiction, one or more of the 
programs included in the grant.

    Example. Assume that Guam applies for a consolidated grant under the 
Vocational Education Act, the Handicapped Preschool and School Programs-
Incentive Grants, and the Adult Education Act and that the sum of the 
allocations under these programs is $700,000. Guam may choose to 
allocate this $700,000 among all of the programs authorized under the 
three programs. Alternatively, it may choose to allocate the entire 
$700,000 to one or two of the programs; for example, the Adult Education 
Act Program.

    (b) An Insular Area shall comply with the statutory and regulatory 
requirements that apply to each program under which funds from the 
consolidated grant are expended.

    Example. Assume that American Samoa uses part of the funds under a 
consolidated grant for the State program under the Adult Education Act. 
American Samoa need not submit to the Secretary a State plan that 
requires policies and procedures to assure all students equal access to 
adult education programs. However, in carrying out the program, American 
Samoa must meet and be able to demonstrate compliance with this equal 
access requirement.

(Authority: 48 U.S.C. 1469a)

[47 FR 17421, Apr. 22, 1982]



Sec. 76.130  How are consolidated grants made?

    (a) The Secretary annually makes a single consolidated grant to each 
Insular Area that meets the requirements of Secs. 76.125 through 76.137 
and each program under which the grant funds are to be used and 
administered.
    (b) The Secretary may decide that one or more programs cannot be 
included in the consolidated grant if the Secretary determines that the 
Insular Area failed to meet the program objectives stated in its plan 
for the previous fiscal year in which it carried out the programs.
    (c) Under a consolidated grant, an Insular Area may use a single 
advisory council for any or all of the programs that require an advisory 
council.
    (d) Although Pub. L. 95-134 authorizies the Secretary to consolidate 
grant funds that the Department awards to an Insular Area, it does not 
confer eligibility for any grant funds. The eligibility of a particular 
Insular Area to receive grant funds under a Federal education program is 
determined under the statute and regulations for that program.

(Authority: 48 U.S.C. 1469a)

[47 FR 17421, Apr. 22, 1982]



Sec. 76.131  How does an insular area apply for a consolidated grant?

    (a) An Insular Area that desires to apply for a grant consolidating 
two or more programs listed in Sec. 76.125(c) shall submit to the 
Secretary an application that:
    (1) Contains the assurances in Sec. 76.132; and
    (2) Meets the application requirements in paragraph (c) of this 
section.
    (b) The submission of an application that contains these 
requirements and assurances takes the place of a separate State plan or 
other similar document required by this part or by the authorizing 
statutes and regulations

[[Page 151]]

for programs included in the consolidated grant.
    (c) An Insular Area shall include in its consolidated grant 
application a program plan that:
    (1) Contains a list of the programs in Sec. 76.125(c) to be included 
in the consolidated grant;
    (2) Describes the program or programs in Sec. 76.125(c) under which 
the consolidated grant funds will be used and administered;
    (3) Describes the goals, objectives, activities, and the means of 
evaluating program outcomes for the programs for which the Insular Area 
will use the funds received under the consolidated grant during the 
fiscal year for which it submits the application, including needs of the 
population that will be met by the consolidation of funds; and
    (4) Contains a budget that includes a description of the allocation 
of funds--including any anticipated carryover funds of the program in 
the consolidated grant from the preceding year--among the programs to be 
included in the consolidated grant.

(Approved by the Office of Management and Budget under control number 
1880-0513)

(Authority: 48 U.S.C. 1469a)

[47 FR 17421, Apr. 22, 1982, as amended at 53 FR 49143, Dec. 6, 1988]



Sec. 76.132  What assurances must be in a consolidated grant 
application?

    (a) An Insular Area shall include in its consolidated grant 
application assurances to the Secretary that it will:
    (1) Follow policies and use administrative practices that will 
insure that non-Federal funds will not be supplanted by Federal funds 
made available under the authority of the programs in the consolidated 
grant;
    (2) Comply with the requirements (except those relating to the 
submission of State plans or similar documents) in the authorizing 
statutes and implementing regulations for the programs under which funds 
are to be used and administered, (except requirements for matching 
funds);
    (3) Provide for proper and efficient administration of funds in 
accordance with the authorizing statutes and implementing regulations 
for those programs under which funds are to be used and administered;
    (4) Provide for fiscal control and fund accounting procedures to 
assure proper disbursement of, and accounting for, Federal funds 
received under the consolidated grant;
    (5) Submit an annual report to the Secretary containing information 
covering the program or programs for which the grant is used and 
administered, including the financial and program performance 
information required under 2 CFR 200.327 and 200.328.
    (6) Provide that funds received under the consolidated grant will be 
under control of, and that title to property acquired with these funds 
will be in, a public agency, institution, or organization. The public 
agency shall administer these funds and property;
    (7) Keep records, including a copy of the State Plan or application 
document under which funds are to be spent, which show how the funds 
received under the consolidated grant have been spent.
    (8) Adopt and use methods of monitoring and providing technical 
assistance to any agencies, organizations, or institutions that carry 
out the programs under the consolidated grant and enforce any 
obligations imposed on them under the applicable statutes and 
regulations.
    (9) Evaluate the effectiveness of these programs in meeting the 
purposes and objectives in the authorizing statutes under which program 
funds are used and administered;
    (10) Conduct evaluations of these programs at intervals and in 
accordance with procedures the Secretary may prescribe; and
    (11) Provide appropriate opportunities for participation by local 
agencies, representatives of the groups affected by the programs, and 
other interested institutions, organizations, and individuals in 
planning and operating the programs.
    (b) These assurances remain in effect for the duration of the 
programs they cover.

(Authority: 48 U.S.C. 1469a)

[47 FR 17421, Apr. 22, 1982, as amended at 64 FR 50392, Sept. 16, 1999; 
79 FR 76093, Dec. 19, 2014]

[[Page 152]]



Sec. 76.133  What is the reallocation authority?

    (a) After an Insular Area receives a consolidated grant, it may 
reallocate the funds in a manner different from the allocation described 
in its consolidated grant application. However, the funds cannot be used 
for purposes that are not authorized under the programs in the 
consolidated grant under which funds are to be used and administered.
    (b) If an Insular Area decides to reallocate the funds it receives 
under a consolidated grant, it shall notify the Secretary by amending 
its original application to include an update of the information 
required under Sec. 76.131.

(Authority: 48 U.S.C. 1469a)

[47 FR 17421, Apr. 22, 1982]



Sec. 76.134  What is the relationship between consolidated and 
non-consolidated grants?

    (a) An Insular Area may request that any number of programs in 
Sec. 76.125(c) be included in its consolidated grant and may apply 
separately for assistance under any other programs listed in 
Sec. 76.125(c) for which it is eligible.
    (b) Those programs that an Insular Area decides to exclude from 
consolidation--for which it must submit separate plans or applications--
are implemented in accordance with the applicable program statutes and 
regulations. The excluded programs are not subject to the provisions for 
allocation of funds among programs in a consolidated grant.

(Authority: 48 U.S.C. 1469a)

[47 FR 17421, Apr. 22, 1982]



Sec. 76.135  Are there any requirements for matching funds?

    The Secretary waives all requirements for matching funds for those 
programs that are consolidated by an Insular Area in a consolidated 
grant application.

(Authority: 48 U.S.C. 1469a)

[47 FR 17421, Apr. 22, 1982]



Sec. 76.136  Under what programs may consolidated grant funds
be spent?

    Insular Areas may only use and administer funds under programs 
described in Sec. 76.125(c) during a fiscal year for which the Insular 
Area is entitled to receive funds under an appropriation for that 
program.

(Authority: 48 U.S.C. 1469a)

[47 FR 17421, Apr. 22, 1982, as amended at 57 FR 30341, July 8, 1992]



Sec. 76.137  How may carryover funds be used under the consolidated 
grant application?

    Any funds under any applicable program which are available for 
obligation and expenditure in the year succeeding the fiscal year for 
which they are appropriated must be obligated and expended in accordance 
with the consolidated grant application submitted by the Insular Area 
for that program for the succeeding fiscal year.

(Authority: 20 U.S.C. 1225(b); 48 U.S.C. 1469a)

                               Amendments



Sec. 76.140  Amendments to a State plan.

    (a) If the Secretary determines that an amendment to a State plan is 
essential during the effective period of the plan, the State shall make 
the amendment.
    (b) A State shall also amend a State plan if there is a significant 
and relevant change in:
    (1) The information or the assurances in the plan;
    (2) The administration or operation of the plan; or
    (3) The organization, policies, or operations of the State agency 
that received the grant, if the change materially affects the 
information or assurances in the plan.

(Authority: 20 U.S.C. 1221e-3, 1231g(a), and 3474)



Sec. 76.141  An amendment requires the same procedures as the 
document being amended.

    If a State amends a State plan under Sec. 76.140, the State shall 
use the same procedures as those it must use to prepare and submit a 
State plan.

(Authority: 20 U.S.C. 1221e-3 and 3474)



Sec. 76.142  An amendment is approved on the same basis as the 
document being amended.

    The Secretary uses the same procedures to approve an amendment to a

[[Page 153]]

State plan--or any other document a State submits--as the Secretary uses 
to approve the original document.

(Authority: 20 U.S.C. 1221e-3 and 3474)



                Subpart C_How a Grant Is Made to a State

                Approval or Disapproval by the Secretary



Sec. 76.201  A State plan must meet all statutory and regulatory 
requirements.

    The Secretary approves a State plan if it meets the requirements of 
the Federal statutes and regulations that apply to the plan.

(Authority: 20 U.S.C. 1221e-3 and 3474)



Sec. 76.202  Opportunity for a hearing before a State plan is disapproved.

    The Secretary may disapprove a State plan only after:
    (a) Notifying the State;
    (b) Offering the State a reasonable opportunity for a hearing; and
    (c) Holding the hearing, if requested by the State.

(Authority: 20 U.S.C. 1221e-3 and 3474)



Sec. 76.235  The notification of grant award.

    (a) To make a grant to a State, the Secretary issues and sends to 
the State a notification of grant award.
    (b) The notification of grant award tells the amount of the grant 
and provides other information about the grant.

(Authority: 20 U.S.C. 1221e-3 and 3474)

               Allotments and Reallotments of Grant Funds



Sec. 76.260  Allotments are made under program statute or regulations.

    (a) The Secretary allots program funds to a State in accordance with 
the authorizing statute or implementing regulations for the program.
    (b) Any reallotment to other States will be made by the Secretary in 
accordance with the authorizing statute or implementing regulations for 
that program.

(Authority: 20 U.S.C. 3474(a))

[50 FR 29330, July 18, 1985]



Sec. 76.261  Reallotted funds are part of a State's grant.

    Funds that a State receives as a result of a reallotment are part of 
the State's grant for the appropriate fiscal year. However, the 
Secretary does not consider a reallotment in determining the maximum or 
minimum amount to which a State is entitled for a following fiscal year.

(Authority: 20 U.S.C. 1221e-3 and 3474)



           Subpart D_How To Apply to the State for a Subgrant



Sec. 76.300  Contact the State for procedures to follow.

    An applicant for a subgrant can find out the procedures it must 
follow by contacting the State agency that administers the program.

(Authority: 20 U.S.C. 1221e-3 and 3474)

    Cross Reference: See subparts E and G of this part for the general 
responsibilities of the State regarding applications for subgrants.



Sec. 76.301  Local educational agency general application.

    A local educational agency that applies for a subgrant under a 
program subject to this part shall have on file with the State a general 
application that meets the requirements of Section 442 of the General 
Education Provisions Act.

(Approved by the Office of Management and Budget under control number 
1880-0513)

(Authority: 20 U.S.C. 1221e-3, 1232d, and 3474)

[52 FR 27804, July 24, 1987, as amended at 53 FR 49143, Dec. 6, 1988; 60 
FR 46493, Sept. 6, 1995]



Sec. 76.302  The notice to the subgrantee.

    A State shall notify a subgrantee in writing of:
    (a) The amount of the subgrant;
    (b) The period during which the subgrantee may obligate the funds; 
and

[[Page 154]]

    (c) The Federal requirements that apply to the subgrant.

(Approved by the Office of Management and Budget under control number 
1880-0513)

(Authority: 20 U.S.C. 1221e-3 and 3474)

[45 FR 22517, Apr. 3, 1980. Redesignated at 45 FR 77368, Nov. 21, 1980, 
as amended at 53 FR 49143, Dec. 6, 1988]



Sec. 76.303  Joint applications and projects.

    (a) Two or more eligible parties may submit a joint application for 
a subgrant.
    (b) If the State must use a formula to distribute subgrant funds 
(see Sec. 76.51), the State may not make a subgrant that exceeds the sum 
of the entitlements of the separate subgrantees.
    (c) If the State funds the application, each subgrantee shall:
    (1) Carry out the activities that the subgrantee agreed to carry 
out; and
    (2) Use the funds in accordance with Federal requirements.
    (d) Each subgrantee shall use an accounting system that permits 
identification of the costs paid for under its subgrant.

(Authority: 20 U.S.C. 1221e-3 and 3474)



Sec. 76.304  Subgrantee shall make subgrant application available
to the public.

    A subgrantee shall make any application, evaluation, periodic 
program plan, or report relating to each program available for public 
inspection.

(Authority: 20 U.S.C. 1221e-3, 1232e, and 3474)



            Subpart E_How a Subgrant Is Made to an Applicant



Sec. 76.400  State procedures for reviewing an application.

    A State that receives an application for a subgrant shall take the 
following steps:
    (a) Review. The State shall review the application.
    (b) Approval--entitlement programs. The State shall approve an 
application if:
    (1) The application is submitted by an applicant that is entitled to 
receive a subgrant under the program; and
    (2) The applicant meets the requirements of the Federal statutes and 
regulations that apply to the program.
    (c) Approval--discretionary programs. The State may approve an 
application if:
    (1) The application is submitted by an eligible applicant under a 
program in which the State has the discretion to select subgrantees;
    (2) The applicant meets the requirements of the Federal statutes and 
regulations that apply to the program; and
    (3) The State determines that the project should be funded under the 
authorizing statute and implementing regulations for the program.
    (d) Disapproval--entitlement and discretionary programs. If an 
application does not meet the requirements of the Federal statutes and 
regulations that apply to a program, the State shall not approve the 
application.

(Authority: 20 U.S.C. 1221e-3 and 3474)



Sec. 76.401  Disapproval of an application--opportunity for a hearing.

    (a) State agency hearing before disapproval. Under the programs 
listed in the chart below, the State agency that administers the program 
shall provide an applicant with notice and an opportunity for a hearing 
before it may disapprove the application.

------------------------------------------------------------------------
                                                            Implementing
                                                             regulations
              Program                 Authorizing statute   Title 34 CFR
                                                                Part
------------------------------------------------------------------------
Chapter 1, Program in Local         Title I, Chapter 1,              200
 Educational Agencies.               Elementary and
                                     Secondary Education
                                     Act of 1965, as
                                     amended (20 U.S.C.
                                     2701-2731, 2821-2838,
                                     2851-2854, and 2891-
                                     2901).
Chapter 1, Program for Neglected    Title 1, Chapter 1,              203
 and Delinquent Children.            Elementary and
                                     Secondary Education
                                     Act of 1965, as
                                     amended (20 U.S.C.
                                     2801-2804).

[[Page 155]]

 
State Grants for Strengthening      Title II, Part A,                208
 Instruction in Mathematics and      Elementary and
 Science.                            Secondary Education
                                     Act of 1965, as
                                     amended (20 U.S.C.
                                     2981-2993).
Federal, State, and Local           Title I, Chapter 2,              298
 Partnership for Educational         Elementary and
 Improvement.                        Secondary Education
                                     Act of 1965, as
                                     amended (20 U.S.C.
                                     2911-2952 and 2971-
                                     2976).
Assistance to States for Education  Part B, Individuals              300
 of Handicapped Children.            with Disabilities
                                     Education Act (except
                                     Section 619) (20
                                     U.S.C. 1411-1420).
Preschool Grants..................  Section 619,                     301
                                     Individuals with
                                     Disabilities
                                     Education Act (20
                                     U.S.C. 1419).
Chapter 1, State-Operated or        Title 1, Chapter 1,              302
 Supported Programs for              Elementary and
 Handicapped Children.               Secondary Education
                                     Act of 1965, as
                                     amended (20 U.S.C.
                                     2791-2795).
Transition Program for Refugee      Section 412(d),                  538
 Children.                           Immigration and
                                     Naturalization Act (8
                                     U.S.C. 1522(d)).
Emergency Immigrant Education       Emergency Immigrant              581
 Program.                            Education Act (20
                                     U.S.C. 3121-3130).
Financial Assistance for            Section 711, Higher              617
 Construction, Reconstruction, or    Education Act of 1965
 Renovation of Higher Education      (20 U.S.C. 1132b).
 Facilities.
------------------------------------------------------------------------

    (b) Other programs--hearings not required. Under other programs 
covered by this part, a State agency--other than a State educational 
agency--is not required to provide an opportunity for a hearing 
regarding the agency's disapproval of an application.
    (c) If an applicant for a subgrant alleges that any of the following 
actions of a State educational agency violates a State or Federal 
statute or regulation, the State educational agency and the applicant 
shall use the procedures in paragraph (d) of this section:
    (1) Disapproval of or failure to approve the application or project 
in whole or in part.
    (2) Failure to provide funds in amounts in accordance with the 
requirements of statutes and regulations.
    (d) State educational agency hearing procedures. (1) If the 
applicant applied under a program listed in paragraph (a) of this 
section, the State educational agency shall provide an opportunity for a 
hearing before the agency disapproves the application.
    (2) If the applicant applied under a program not listed in paragraph 
(a) of this section, the State educational agency shall provide an 
opportunity for a hearing either before or after the agency disapproves 
the application.
    (3) The applicant shall request the hearing within 30 days of the 
action of the State educational agency.
    (4)(i) Within 30 days after it receives a request, the State 
educational agency shall hold a hearing on the record and shall review 
its action.
    (ii) No later than 10 days after the hearing the agency shall issue 
its written ruling, including findings of fact and reasons for the 
ruling.
    (iii) If the agency determines that its action was contrary to State 
or Federal statutes or regulations that govern the applicable program, 
the agency shall rescind its action.
    (5) If the State educational agency does not rescind its final 
action after a review under this paragraph, the applicant may appeal to 
the Secretary. The applicant shall file a notice of the appeal with the 
Secretary within 20 days after the applicant has been notified by the 
State educational agency of the results of the agency's review. If 
supported by substantial evidence, findings of fact of the State 
educational agency are final.
    (6)(i) The Secretary may also issue interim orders to State 
educational agencies as he or she may decide are necessary and 
appropriate pending appeal or review.
    (ii) If the Secretary determines that the action of the State 
educational agency was contrary to Federal statutes or regulations that 
govern the applicable program, the Secretary issues

[[Page 156]]

an order that requires the State educational agency to take appropriate 
action.
    (7) Each State educational agency shall make available at reasonable 
times and places to each applicant all records of the agency pertaining 
to any review or appeal the applicant is conducting under this section, 
including records of other applicants.
    (8) If a State educational agency does not comply with any provision 
of this section, or with any order of the Secretary under this section, 
the Secretary terminates all assistance to the State educational agency 
under the applicable program or issues such other orders as the 
Secretary deems appropriate to achieve compliance.
    (e) Other State agency hearing procedures. State agencies that are 
required to provide a hearing under paragraph (a) of this section--other 
than State educational agencies--are not required to use the procedures 
in paragraph (d) of this section.

    Note: This section is based on a provision in the General Education 
Provisions Act (GEPA). Section 427 of the Department of Education 
Organization Act (DEOA), 20 U.S.C. 3487, provides that except to the 
extent inconsistent with the DEOA, the GEPA ``shall apply to functions 
transferred by this Act to the extent applicable on the day preceding 
the effective date of this Act.'' Although standardized nomenclature is 
used in this section to reflect the creation of the Department of 
Education, there is no intent to extend the coverage of the GEPA beyond 
that authorized under Section 427 or other applicable law.

(Authority: 20 U.S.C. 1221e-3, 1231b-2, 3474, and 6511(a))

[45 FR 22517, Apr. 3, 1980. Redesignated at 45 FR 77368, Nov. 21, 1980, 
as amended at 45 FR 86296, Dec. 30, 1980; 50 FR 43545, Oct. 25, 1985; 52 
FR 27805, July 24, 1987; 54 FR 21775, May 19, 1989; 55 FR 14816, Apr. 
18, 1990; 57 FR 30341, July 8, 1992; 60 FR 46493, Sept. 6, 1995]



 Subpart F_What Conditions Must Be Met by the State and Its Subgrantees?

                            Nondiscrimination



Sec. 76.500  Federal statutes and regulations on nondiscrimination.

    (a) A State and a subgrantee shall comply with the following 
statutes and regulations:

------------------------------------------------------------------------
             Subject                    Statute           Regulation
------------------------------------------------------------------------
Discrimination on the basis of    Title VI of the     34 CFR part 100.
 race, color, or national origin.  Civil Rights Act
                                   of 1964 (45
                                   U.S.C. 2000d
                                   through 2000d-4).
Discrimination on the basis of    Title IX of the     34 CFR part 106.
 sex.                              Education
                                   Amendments of
                                   1972 (20 U.S.C.
                                   1681-1683).
Discrimination on the basis of    Section 504 of the  34 CFR part 104.
 handicap.                         Rehabilitation
                                   Act of 1973 (29
                                   U.S.C. 794).
Discrimination on the basis of    The Age             34 CFR part 110.
 age.                              Discrimination
                                   Act (42 U.S.C.
                                   6101 et seq.).
------------------------------------------------------------------------

    (b) A State or subgrantee that is a covered entity as defined in 
Sec. 108.3 of this title shall comply with the nondiscrimination 
requirements of the Boy Scouts of America Equal Access Act, 20 U.S.C. 
7905, 34 CFR part 108.

(Authority: 20 U.S.C. 1221e-3, 3474, and 6511(a))

[45 FR 22497, Apr. 3, 1980. Redesignated at 45 FR 77368, Nov. 21, 1980, 
as amended at 71 FR 15002, Mar. 24, 2006]

                             Allowable Costs



Sec. 76.530  General cost principles.

    The general principles to be used in determining costs applicable to 
grants, subgrants, and cost-type contracts under grants and subgrants 
are specified at 2 CFR part 200, subpart E--Cost Principles.

(Authority: 20 U.S.C. 1221e-3 and 3474)

[79 FR 76093, Dec. 19, 2014]



Sec. 76.532  Use of funds for religion prohibited.

    (a) No State or subgrantee may use its grant or subgrant to pay for 
any of the following:
    (1) Religious worship, instruction, or proselytization.

[[Page 157]]

    (2) Equipment or supplies to be used for any of the activities 
specified in paragraph (a)(1) of this section.
    (b) [Reserved]

(Authority: 20 U.S.C. 1221e-3, 3474, and 6511(a))

[45 FR 22517, Apr. 3, 1980. Redesignated at 45 FR 77368, Nov. 21, 1980, 
as amended at 69 FR 31711, June 4, 2004]



Sec. 76.533  Acquisition of real property; construction.

    No State or subgrantee may use its grant or subgrant for acquisition 
of real property or for construction unless specifically permitted by 
the authorizing statute or implementing regulations for the program.

(Authority: 20 U.S.C. 1221e-3, 3474, and 6511(a))



Sec. 76.534  Use of tuition and fees restricted.

    No State or subgrantee may count tuition and fees collected from 
students toward meeting matching, cost sharing, or maintenance of effort 
requirements of a program.

(Authority: 20 U.S.C. 1221e-3, 3474, and 6511(a))

                           Indirect Cost Rates



Sec. 76.560  General indirect cost rates; exceptions.

    (a) The differences between direct and indirect costs and the 
principles for determining the general indirect cost rate that a grantee 
may use for grants under most programs are specified in the cost 
principles for--
    (1) All grantees, other than hospitals and commercial (for-profit) 
organizations, at 2 CFR part 200, subpart E--Cost Principles;
    (2) Hospitals, at 45 CFR part 75, Appendix XI, Principles for 
Determining Costs Applicable to Research and Development Under Awards 
and Contracts With Hospitals; and
    (3) Commercial (for-profit) organizations, at 48 CFR part 31, 
Contract Cost Principles and Procedures.
    (b) A grantee must have a current indirect cost rate agreement to 
charge indirect costs to a grant. To obtain an indirect cost rate, a 
grantee must submit an indirect cost proposal to its cognizant agency 
and negotiate an indirect cost rate agreement.
    (c) The Secretary may establish a temporary indirect cost rate for a 
grantee that does not have an indirect cost rate agreement with its 
cognizant agency.
    (d) The Secretary accepts an indirect cost rate negotiated by a 
grantee's cognizant agency, but may establish a restricted indirect cost 
rate for a grantee to satisfy the statutory requirements of certain 
programs administered by the Department.

(Authority: 20 U.S.C. 1221e-3, 3474, and 6511(a))

[57 FR 30341, July 8, 1992, as amended at 59 FR 59582, Nov. 17, 1994; 79 
FR 76094, Dec. 19, 2014]



Sec. 76.561  Approval of indirect cost rates.

    (a) If the Department of Education is the cognizant agency, the 
Secretary approves an indirect cost rate for a State agency and for a 
subgrantee other than a local educational agency. For the purposes of 
this section, the term local educational agency does not include a State 
agency.
    (b) Each State educational agency, on the basis of a plan approved 
by the Secretary, shall approve an indirect cost rate for each local 
educational agency that requests it to do so. These rates may be for 
periods longer than a year if rates are sufficiently stable to justify a 
longer period.
    (c) The Secretary generally approves indirect cost rate agreements 
annually. Indirect cost rate agreements may be approved for periods 
longer than a year if the Secretary determines that rates will be 
sufficiently stable to justify a longer rate period.

(Authority: 20 U.S.C. 1221e-3, 3474, and 6511(a))

[59 FR 59583, Nov. 17, 1994]



Sec. 76.563  Restricted indirect cost rate--programs covered.

    Sections 76.564 through 76.569 apply to agencies of State and local 
governments that are grantees under programs with a statutory 
requirement prohibiting the use of Federal funds to supplant non-Federal 
funds, and to

[[Page 158]]

their subgrantees under these programs.

(Authority: 20 U.S.C. 1221e-3, 3474, and 6511(a))

[59 FR 59583, Nov. 17, 1994]



Sec. 76.564  Restricted indirect cost rate--formula.

    (a) An indirect cost rate for a grant covered by Sec. 76.563 or 34 
CFR 75.563 is determined by the following formula:

Restricted indirect cost rate = (General management costs + Fixed costs) 
     (Other expenditures)

    (b) General management costs, fixed costs, and other expenditures 
must be determined under Secs. 76.565 through 76.567.
    (c) Under the programs covered by Sec. 76.563, a subgrantee of an 
agency of a State or a local government (as those terms are defined in 2 
CFR 200.90 and 200.64, respectively), or a grantee subject to 34 CFR 
75.563 that is not a State or local government agency may use--
    (1) An indirect cost rate computed under paragraph (a) of this 
section; or
    (2) An indirect cost rate of eight percent unless the Secretary 
determines that the subgrantee or grantee would have a lower rate under 
paragraph (a) of this section.
    (d) Indirect costs that are unrecovered as a result of these 
restrictions may not be charged directly, used to satisfy matching or 
cost-sharing requirements, or charged to another Federal award.

(Authority: 20 U.S.C. 1221e-3(a)(1), 2831(a), 2974(b), and 3474)

[59 FR 59583, Nov. 17, 1994, as amended at 79 FR 76094, Dec. 19, 2014]



Sec. 76.565  General management costs--restricted rate.

    (a) As used in Sec. 76.564, general management costs means the costs 
of activities that are for the direction and control of the grantee's 
affairs that are organization-wide. An activity is not organization-wide 
if it is limited to one activity, one component of the grantee, one 
subject, one phase of operations, or other single responsibility.
    (b) General management costs include the costs of performing a 
service function, such as accounting, payroll preparation, or personnel 
management, that is normally at the grantee's level even if the function 
is physically located elsewhere for convenience or better management. 
The term also includes certain occupancy and space maintenance costs as 
determined under Sec. 76.568.
    (c) The term does not include expenditures for--
    (1) Divisional administration that is limited to one component of 
the grantee;
    (2) The governing body of the grantee;
    (3) Compensation of the chief executive officer of the grantee;
    (4) Compensation of the chief executive officer of any component of 
the grantee; and
    (5) Operation of the immediate offices of these officers.
    (d) For purposes of this section--
    (1) The chief executive officer of the grantee is the individual who 
is the head of the executive office of the grantee and exercises overall 
responsibility for the operation and management of the organization. The 
chief executive officer's immediate office includes any deputy chief 
executive officer or similar officer along with immediate support staff 
of these individuals. The term does not include the governing body of 
the grantee, such as a board or a similar elected or appointed governing 
body; and
    (2) Components of the grantee are those organizational units 
supervised directly or indirectly by the chief executive officer. These 
organizational units generally exist one management level below the 
executive office of the grantee. The term does not include the office of 
the chief executive officer or a deputy chief executive officer or 
similar position.

(Authority: 20 U.S.C. 1221e-3(a)(1), 2831(a), 2974(b), and 3474)

[59 FR 59583, Nov. 17, 1994]



Sec. 76.566  Fixed costs--restricted rate.

    As used in Sec. 76.564, fixed costs means contributions of the 
grantee to fringe benefits and similar costs, but only those associated 
with salaries and wages that are charged as indirect costs, including--

[[Page 159]]

    (a) Retirement, including State, county, or local retirement funds, 
Social Security, and pension payments;
    (b) Unemployment compensation payments; and
    (c) Property, employee, health, and liability insurance.

(Authority: 20 U.S.C. 1221e-3(a)(1), 2831(a), 2974(b), and 3474)

[59 FR 59583, Nov. 17, 1994]



Sec. 76.567  Other expenditures--restricted rate.

    (a) As used in Sec. 76.564, other expenditures means the grantee's 
total expenditures for its federally- and non-federally-funded 
activities in the most recent year for which data are available. The 
term also includes direct occupancy and space maintenance costs as 
determined under Sec. 76.568 and costs related to the chief executive 
officers of the grantee and components of the grantee and their offices 
(see Sec. 76.565(c) and (d)).
    (b) The term does not include--
    (1) General management costs determined under Sec. 76.565;
    (2) Fixed costs determined under Sec. 76.566;
    (3) Subgrants;
    (4) Capital outlay;
    (5) Debt service;
    (6) Fines and penalties;
    (7) Contingencies; and
    (8) Election expenses. However, the term does include election 
expenses that result from elections required by an applicable Federal 
statute.

(Authority: 20 U.S.C. 1221e-3(a)(1), 2831(a), 2974(b), and 3474)

[59 FR 59583, Nov. 17, 1994]



Sec. 76.568  Occupancy and space maintenance costs--restricted rate.

    (a) As used in the calculation of a restricted indirect cost rate, 
occupancy and space maintenance costs means such costs as--
    (1) Building costs whether owned or rented;
    (2) Janitorial services and supplies;
    (3) Building, grounds, and parking lot maintenance;
    (4) Guard services;
    (5) Light, heat, and power;
    (6) Depreciation, use allowances, and amortization; and
    (7) All other related space costs.
    (b) Occupancy and space maintenance costs associated with 
organization-wide service functions (accounting, payroll, personnel) may 
be included as general management costs if a space allocation or use 
study supports the allocation.
    (c) Occupancy and space maintenance costs associated with functions 
that are not organization-wide must be included with other expenditures 
in the indirect cost formula. These costs may be charged directly to 
affected programs only to the extent that statutory supplanting 
prohibitions are not violated. This reimbursement must be approved in 
advance by the Secretary.

(Authority: 20 U.S.C. 1221e-3(a)(1), 2831(a), 2974(b), and 3474)

[59 FR 59584, Nov. 17, 1994]



Sec. 76.569  Using the restricted indirect cost rate.

    (a) Under the programs referenced in Sec. 76.563, the maximum amount 
of indirect costs under a grant is determined by the following formula:

Indirect costs = (Restricted indirect cost rate)  x  (Total direct costs 
of the grant minus capital outlays, subgrants, and other distorting or 
unallowable items as specified in the grantee's indirect cost rate 
agreement)

    (b) If a grantee uses a restricted indirect cost rate, the general 
management and fixed costs covered by that rate must be excluded by the 
grantee from the direct costs it charges to the grant.

(Authority: 20 U.S.C. 1221e-3(a)(1), 2831(a), 2974(b), and 3474)

[59 FR 59584, Nov. 17, 1994]



Sec. 76.580  Coordination with other activities.

    A State and a subgrantee shall, to the extent possible, coordinate 
each of its projects with other activities that are in the same 
geographic area served by the project and that serve similar purposes 
and target groups.

(Authority: 20 U.S.C. 1221e-3, 2890, and 3474)

[45 FR 22517, Apr. 3, 1980. Redesignated at 45 FR 77368, Nov. 21, 1980, 
as amended at 57 FR 30341, July 8, 1992]

[[Page 160]]

                               Evaluation



Sec. 76.591  Federal evaluation--cooperation by a grantee.

    A grantee shall cooperate in any evaluation of the program by the 
Secretary.

(Authority: 20 U.S.C. 1221e-3, 1226c, 1231a, 3474, and 6511(a))

[45 FR 86298, Dec. 30, 1980, as amended at 57 FR 30341, July 8, 1992]



Sec. 76.592  Federal evaluation--satisfying requirement for State
or subgrantee evaluation.

    If a State or a subgrantee cooperates in a Federal evaluation of a 
program, the Secretary may determine that the State or subgrantee meets 
the evaluation requirements of the program.

(Authority: 20 U.S.C. 1226c; 1231a)

                              Construction



Sec. 76.600  Where to find construction regulations.

    (a) A State or a subgrantee that requests program funds for 
construction, or whose grant or subgrant includes funds for 
construction, shall comply with the rules on construction that apply to 
applicants and grantees under 34 CFR 75.600-75.617.
    (b) The State shall perform the functions that the Secretary 
performs under Secs. 75.602 (Preservation of historic sites) and 75.605 
(Approval of drawings and specifications) of this title.
    (c) The State shall provide to the Secretary the information 
required under 34 CFR 75.602(a) (Preservation of historic sites).

(Authority: 20 U.S.C. 1221e-3, 3474, and 6511(a))

[45 FR 22517, Apr. 3, 1980. Redesignated at 45 FR 77368, Nov. 21, 1980, 
as amended at 45 FR 86298, Dec. 30, 1980; 57 FR 30341, July 8, 1992]

          Participation of Students Enrolled in Private Schools



Sec. 76.650  Private schools; purpose of Secs. 76.651-76.662.

    (a) Under some programs, the authorizing statute requires that a 
State and its subgrantees provide for participation by students enrolled 
in private schools. Sections 76.651-76.662 apply to those programs and 
provide rules for that participation. These sections do not affect the 
authority of the State or a subgrantee to enter into a contract with a 
private party.
    (b) If any other rules for participation of students enrolled in 
private schools apply under a particular program, they are in the 
authorizing statute or implementing regulations for that program.

(Authority: 20 U.S.C. 1221e-3 and 3474)

    Note: Some program statutes authorize the Secretary--under certain 
circumstances--to provide benefits directly to private school students. 
These ``bypass'' provisions--where they apply--are implemented in the 
individual program regulations.



Sec. 76.651  Responsibility of a State and a subgrantee.

    (a)(1) A subgrantee shall provide students enrolled in private 
schools with a genuine opportunity for equitable participation in 
accordance with the requirements in Secs. 76.652-76.662 and in the 
authorizing statute and implementing regulations for a program.
    (2) The subgrantee shall provide that opportunity to participate in 
a manner that is consistent with the number of eligible private school 
students and their needs.
    (3) The subgrantee shall maintain continuing administrative 
direction and control over funds and property that benefit students 
enrolled in private schools.
    (b)(1) A State shall ensure that each subgrantee complies with the 
requirements in Secs. 76.651-76.662.
    (2) If a State carries out a project directly, it shall comply with 
these requirements as if it were a subgrantee.

(Authority: 20 U.S.C. 1221e-3 and 3474)



Sec. 76.652  Consultation with representatives of private school students.

    (a) An applicant for a subgrant shall consult with appropriate 
representatives of students enrolled in private schools during all 
phases of the development and design of the project covered by the 
application, including consideration of:
    (1) Which children will receive benefits under the project;
    (2) How the children's needs will be identified;

[[Page 161]]

    (3) What benefits will be provided;
    (4) How the benefits will be provided; and
    (5) How the project will be evaluated.
    (b) A subgrantee shall consult with appropriate representatives of 
students enrolled in private schools before the subgrantee makes any 
decision that affects the opportunities of those students to participate 
in the project.
    (c) The applicant or subgrantee shall give the appropriate 
representatives a genuine opportunity to express their views regarding 
each matter subject to the consultation requirements in this section.

(Authority: 20 U.S.C. 1221e-3 and 3474)



Sec. 76.653  Needs, number of students, and types of services.

    A subgrantee shall determine the following matters on a basis 
comparable to that used by the subgrantee in providing for participation 
of public school students:
    (a) The needs of students enrolled in private schools.
    (b) The number of those students who will participate in a project.
    (c) The benefits that the subgrantee will provide under the program 
to those students.

(Authority: 20 U.S.C. 1221e-3 and 3474)



Sec. 76.654  Benefits for private school students.

    (a) Comparable benefits. The program benefits that a subgrantee 
provides for students enrolled in private schools must be comparable in 
quality, scope, and opportunity for participation to the program 
benefits that the subgrantee provides for students enrolled in public 
schools.
    (b) Same benefits. If a subgrantee uses funds under a program for 
public school students in a particular attendance area, or grade or age 
level, the subgrantee shall insure equitable opportunities for 
participation by students enrolled in private schools who:
    (1) Have the same needs as the public school students to be served; 
and
    (2) Are in that group, attendance area, or age or grade level.
    (c) Different benefits. If the needs of students enrolled in private 
schools are different from the needs of students enrolled in public 
schools, a subgrantee shall provide program benefits for the private 
school students that are different from the benefits the subgrantee 
provides for the public school students.

(Authority: 20 U.S.C. 1221e-3 and 3474)



Sec. 76.655  Level of expenditures for students enrolled in private
schools.

    (a) Subject to paragraph (b) of this section, a subgrantee shall 
spend the same average amount of program funds on:
    (1) A student enrolled in a private school who receives benefits 
under the program; and
    (2) A student enrolled in a public school who receives benefits 
under the program.
    (b) The subgrantee shall spend a different average amount on program 
benefits for students enrolled in private schools if the average cost of 
meeting the needs of those students is different from the average cost 
of meeting the needs of students enrolled in public schools.

(Authority: 20 U.S.C. 1221e-3 and 3474)



Sec. 76.656  Information in an application for a subgrant.

    An applicant for a subgrant shall include the following information 
in its application:
    (a) A description of how the applicant will meet the Federal 
requirements for participation of students enrolled in private schools.
    (b) The number of students enrolled in private schools who have been 
identified as eligible to benefits under the program.
    (c) The number of students enrolled in private schools who will 
receive benefits under the program.
    (d) The basis the applicant used to select the students.
    (e) The manner and extent to which the applicant complied with 
Sec. 76.652 (consultation).
    (f) The places and times that the students will receive benefits 
under the program.
    (g) The differences, if any, between the program benefits the 
applicant will provide to public and private school

[[Page 162]]

students, and the reasons for the differences.

(Authority: 20 U.S.C. 1221e-3 and 3474)



Sec. 76.657  Separate classes prohibited.

    A subgrantee may not use program funds 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. 1221e-3 and 3474)



Sec. 76.658  Funds not to benefit a private school.

    (a) A subgrantee may not use program funds to finance the existing 
level of instruction in a private school or to otherwise benefit the 
private school.
    (b) The subgrantee shall use program funds to meet the specific 
needs of students enrolled in private schools, rather than:
    (1) The needs of a private school; or
    (2) The general needs of the students enrolled in a private school.

(Authority: 20 U.S.C. 1221e-3 and 3474)



Sec. 76.659  Use of public school personnel.

    A subgrantee may use program funds to make public personnel 
available in other than public facilities:
    (a) To the extent necessary to provide equitable program benefits 
designed for students enrolled in a private school; and
    (b) If those benefits are not normally provided by the private 
school.

(Authority: 20 U.S.C. 1221e-3 and 3474)



Sec. 76.660  Use of private school personnel.

    A subgrantee may use program funds to pay for the services of an 
employee of a private school 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. 1221e-3 and 3474)



Sec. 76.661  Equipment and supplies.

    (a) Under some program statutes, a public agency must keep title to 
and exercise continuing administrative control of all equipment and 
supplies that the subgrantee acquires with program funds. This public 
agency is usually the subgrantee.
    (b) The subgrantee may place equipment and supplies in a private 
school for the period of time needed for the project.
    (c) The subgrantee shall insure that the equipment or supplies 
placed in a private school:
    (1) Are used only for the purposes of the project; and
    (2) Can be removed from the private school without remodeling the 
private school facilities.
    (d) The subgrantee shall remove equipment or supplies from a private 
school if:
    (1) The equipment or supplies are no longer needed for the purposes 
of the project; or
    (2) Removal is necessary to avoid use of the equipment of supplies 
for other than project purposes.

(Authority: 20 U.S.C. 1221e-3 and 3474)



Sec. 76.662  Construction.

    A subgrantee shall insure that program funds are not used for the 
construction of private school facilities.

(Authority: 20 U.S.C. 1221e-3 and 3474)

                          Procedures for Bypass



Sec. 76.670  Applicability and filing requirements.

    (a) The regulations in Secs. 76.671 through 76.677 apply to the 
following programs under which the Secretary is authorized to waive the 
requirements for providing services to private school children and to 
implement a bypass:

[[Page 163]]



----------------------------------------------------------------------------------------------------------------
                                                                                                    Implementing
                                                                                                     regulations
         CFDA number and name of program                         Authorizing statute                title 34 CFR
                                                                                                        part
----------------------------------------------------------------------------------------------------------------
84.010  Chapter 1 Program in Local Educational    Chapter 1, Title I, Elementary and Secondary               200
 Agencies.                                         Education Act of 1965, as amended (20 U.S.C.
                                                   2701 et seq.).
84.151  Federal, State, and Local Partnership     Chapter 2, Title I, Elementary and Secondary               298
 for Educational Improvement.                      Education Act of 1965, as amended (20 U.S.C.
                                                   2911-2952, 2971-2976).
84.164  Mathematics and Science Education.......  Title II, Part A, Elementary and Secondary                 208
                                                   Education Act of 1965, as amended (20 U.S.C.
                                                   2981-2993).
84.186  State and Local Programs................  Part B, Drug Free Schools and Communities Act of          None
                                                   1986 (20 U.S.C. 3191-3197).
----------------------------------------------------------------------------------------------------------------

    (b) Filing requirements. (1) Any written submission under 
Secs. 76.671 through 76.675 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.
    (2) If agreed upon by the parties, service of a document may be made 
upon the other party by facsimile transmission.
    (3) The filing date for a written submission is the date the 
document is--
    (i) Hand-delivered;
    (ii) Mailed; or
    (iii) Sent by facsimile transmission.
    (4) A party filing by facsimile transmission is responsible for 
confirming that a complete and legible copy of the document was received 
by the Department.
    (5) 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.

(Authority: 20 U.S.C. 2727(b), 2972(d)-(e), 2990(c), 3223(c))

[54 FR 21775, May 19, 1989, as amended at 57 FR 56795, Nov. 30, 1992]



Sec. 76.671  Notice by the Secretary.

    (a) Before taking any final action to implement a bypass under a 
program listed in Sec. 76.670, the Secretary provides the affected 
grantee and subgrantee, if appropriate, with written notice.
    (b) In the written notice, the Secretary--
    (1) States the reasons for the proposed bypass in sufficient detail 
to allow the grantee and subgrantee to respond;
    (2) Cites the requirement that is the basis for the alleged failure 
to comply; and
    (3) Advises the grantee and subgrantee that they--
    (i) Have at least 45 days after receiving the written notice to 
submit written objections to the proposed bypass; and
    (ii) May request in writing the opportunity for a hearing to show 
cause why the bypass should not be implemented.
    (c) The Secretary sends the notice to the grantee and subgrantee by 
certified mail with return receipt requested.

(Authority: 20 U.S.C. 2727(b)(4)(A), 2972(h)(1), 2990(c), 3223(c))

[54 FR 21775, May 19, 1989]



Sec. 76.672  Bypass procedures.

    Sections 76.673 through 76.675 contain the procedures that the 
Secretary uses in conducting a show cause hearing. The hearing officer 
may modify the procedures for a particular case if all parties agree the 
modification is appropriate.

(Authority: 20 U.S.C. 2727(b)(4)(A), 2972(h)(1), 2990(c), 3223(c))

[54 FR 21776, May 19, 1989]



Sec. 76.673  Appointment and functions of a hearing officer.

    (a) If a grantee or subgrantee requests a hearing to show cause why 
the Secretary should not implement a bypass, the Secretary appoints a 
hearing officer and notifies appropriate representatives of the affected 
private school children that they may participate in the hearing.
    (b) The hearing officer has no authority to require or conduct 
discovery or

[[Page 164]]

to rule on the validity of any statute or regulation.
    (c) The hearing officer notifies the grantee, subgrantee, and 
representatives of the private school children of the time and place of 
the hearing.

(Authority: 20 U.S.C. 2727(b)(4)(A), 2972(h)(1), 2990(c), 3223(c))

[54 FR 21776, May 19, 1989]



Sec. 76.674  Hearing procedures.

    (a) The following procedures apply to a show cause hearing regarding 
implementation of a bypass:
    (1) The hearing officer arranges for a transcript to be taken.
    (2) The grantee, subgrantee, and representatives of the private 
school children each may--
    (i) Be represented by legal counsel; and
    (ii) Submit oral or written evidence and arguments at the hearing.
    (b) Within 10 days after the hearing, the hearing officer--
    (1) Indicates that a decision will be issued on the basis of the 
existing record; or
    (2) Requests further information from the grantee, subgrantee, 
representatives of the private school children, or Department officials.

(Authority: 20 U.S.C. 2727(b)(4)(A), 2972(h)(1), 2990(c), 3223(c))

[54 FR 21776, May 19, 1989]



Sec. 76.675  Posthearing procedures.

    (a)(1) Within 120 days after the record of a show cause hearing is 
closed, the hearing officer issues a written decision on whether a 
bypass should be implemented.
    (2) The hearing officer sends copies of the decision to the grantee, 
subgrantee, representatives of the private school children, and the 
Secretary.
    (b) Within 30 days after receiving the hearing officer's decision, 
the grantee, subgrantee, and representatives of the private school 
children may each submit to the Secretary written comments on the 
decision.
    (c) The Secretary may adopt, reverse, modify, or remand the hearing 
officer's decision.

(Authority: 20 U.S.C. 2727(b)(4)(A), 2972(h)(1), 2990(c), 3223(c))

[54 FR 21776, May 19, 1989]



Sec. 76.676  Judicial review of a bypass action.

    If a grantee or subgrantee is dissatisfied with the Secretary's 
final action after a proceeding under Secs. 76.672 through 76.675, it 
may, within 60 days after receiving 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.

(Authority: 20 U.S.C. 2727(b)(4)(B)-(D), 2972(h)(2)-(4), 2990(c), 
3223(c))

[54 FR 21776, May 19, 1989]



Sec. 76.677  Continuation of a bypass.

    The Secretary continues a bypass until the Secretary determines that 
the grantee or subgrantee will meet the requirements for providing 
services to private school children.

(Authority: 20 U.S.C. 1221e-3, 2727(b)(3)(D), 2972(f), and 3474)

[54 FR 21776, May 19, 1989]

                 Other Requirements for Certain Programs



Sec. 76.681  Protection of human subjects.

    If a State or a subgrantee uses a human subject in a research 
project, the State or subgrantee shall protect the person from physical, 
psychological, or social injury resulting from the project.

(Authority: 20 U.S.C. 1221e-3, 3474, and 6511(a))

[45 FR 22517, Apr. 3, 1980. Redesignated at 45 FR 77368, Nov. 21, 1980, 
as amended at 57 FR 30341, July 8, 1992]



Sec. 76.682  Treatment of animals.

    If a State or a subgrantee uses an animal in a project, the State or 
subgrantee shall provide the animal with proper care and humane 
treatment in accordance with the Animal Welfare Act of 1970.

(Authority: Pub. L. 89-544, as amended)

[[Page 165]]



Sec. 76.683  Health or safety standards for facilities.

    A State and a subgrantee shall comply with any Federal health or 
safety requirements that apply to the facilities that the State or 
subgrantee uses for a project.

(Authority: 20 U.S.C. 1221e-3, 3474, and 6511(a))



Subpart G_What Are the Administrative Responsibilities of the State and 
                            Its Subgrantees?

                 General Administrative Responsibilities



Sec. 76.700  Compliance with statutes, regulations, State plan, and 
applications.

    A State and a subgrantee shall comply with the State plan and 
applicable statutes, regulations, and approved applications, and shall 
use Federal funds in accordance with those statutes, regulations, plan, 
and applications.

(Authority: 20 U.S.C. 1221e-3, 3474, and 6511(a))



Sec. 76.701  The State or subgrantee administers or supervises each 
project.

    A State or a subgrantee shall directly administer or supervise the 
administration of each project.

(Authority: 20 U.S.C. 1221e-3, 3474, and 6511(a))



Sec. 76.702  Fiscal control and fund accounting procedures.

    A State and a subgrantee shall use fiscal control and fund 
accounting procedures that insure proper disbursement of and accounting 
for Federal funds.

(Authority: 20 U.S.C. 1221e-3, 3474, and 6511(a))



Sec. 76.703  When a State may begin to obligate funds.

    (a)(1) The Secretary may establish, for a program subject to this 
part, a date by which a State must submit for review by the Department a 
State plan and any other documents required to be submitted under 
guidance provided by the Department under paragraph (b)(3) of this 
section.
    (2) If the Secretary does not establish a date for the submission of 
State plans and any other documents required under guidance provided by 
the Department, the date for submission is three months before the date 
the Secretary may begin to obligate funds under the program.
    (b)(1) This paragraph (b) describes the circumstances under which 
the submission date for a State plan may be deferred.
    (2) If a State asks the Secretary in writing to defer the submission 
date for a State plan because of a Presidentially declared disaster that 
has occurred in that State, the Secretary may defer the submission date 
for the State plan and any other document required under guidance 
provided by the Department if the Secretary determines that the disaster 
significantly impairs the ability of the State to submit a timely State 
plan or other document required under guidance provided by the 
Department.
    (3)(i) The Secretary establishes, for a program subject to this 
part, a date by which the program office must deliver guidance to the 
States regarding the contents of the State plan under that program.
    (ii) The Secretary may only establish a date for the delivery of 
guidance to the States so that there are at least as many days between 
that date and the date that State plans must be submitted to the 
Department as there are days between the date that State plans must be 
submitted to the Department and the date that funds are available for 
obligation by the Secretary on July 1, or October 1, as appropriate.
    (iii) If a State does not receive the guidance by the date 
established under paragraph (b)(3)(i) of this section, the submission 
date for the State plan under the program is deferred one day for each 
day that the guidance is late in being received by the State.

    Note: The following examples describe how the regulations in 
Sec. 76.703(b)(3) would act to defer the date that a State would have to 
submit its State plan.
    Example 1. The Secretary decides that State plans under a forward-
funded program must be submitted to the Department by May first. The 
Secretary must provide guidance to the States under this program by 
March first, so that the States have at least

[[Page 166]]

as many days between the guidance date and the submission date (60) as 
the Department has between the submission date and the date that funds 
are available for obligation (60). If the program transmits guidance to 
the States on February 15, specifying that State plans must be submitted 
by May first, States generally would have to submit State plans by that 
date. However, if, for example, a State did not receive the guidance 
until March third, that State would have until May third to submit its 
State plan because the submission date of its State plan would be 
deferred one day for each day that the guidance to the State was late.
    Example 2. If a program publishes the guidance in the Federal 
Register on March third, the States would be considered to have received 
the guidance on that day. Thus, the guidance could not specify a date 
for the submission of State plans before May second, giving the States 
59 days between the date the guidance is published and the submission 
date and giving the Department 58 days between the submission date and 
the date that funds are available for obligation.

    (c)(1) For the purposes of this section, the submission date of a 
State plan or other document is the date that the Secretary receives the 
plan or document.
    (2) The Secretary does not determine whether a State plan is 
substantially approvable until the plan and any documents required under 
guidance provided by the Department have been submitted.
    (3) The Secretary notifies a State when the Department has received 
the State plan and all documents required under guidance provided by the 
Department.
    (d) If a State submits a State plan in substantially approvable form 
(or an amendment to the State plan that makes it substantially 
approvable), and submits any other document required under guidance 
provided by the Department, on or before the date the State plan must be 
submitted to the Department, the State may begin to obligate funds on 
the date that the funds are first available for obligation by the 
Secretary.
    (e) If a State submits a State plan in substantially approvable form 
(or an amendment to the State plan that makes it substantially 
approvable) or any other documents required under guidance provided by 
the Department after the date the State plan must be submitted to the 
Department, and--
    (1) The Department determines that the State plan is substantially 
approvable on or before the date that the funds are first available for 
obligation by the Secretary, the State may begin to obligate funds on 
the date that the funds are first available for obligation by the 
Secretary; or
    (2) The Department determines that the State plan is substantially 
approvable after the date that the funds are first available for 
obligation by the Secretary, the State may begin to obligate funds on 
the earlier of the two following dates:
    (i) The date that the Secretary determines that the State plan is 
substantially approvable.
    (ii) The date that is determined by adding to the date that funds 
are first available for obligation by the Secretary--
    (A) The number of days after the date the State plan must be 
submitted to the Department that the State plan or other document 
required under guidance provided by the Department is submitted; and
    (B) If applicable, the number of days after the State receives 
notice that the State plan is not substantially approvable that the 
State submits additional information that makes the plan substantially 
approvable.
    (f) Additional information submitted under paragraph (e)(2)(ii)(B) 
of this section must be signed by the person who submitted the original 
State plan (or an authorized delegate of that officer).
    (g)(1) If the Department does not complete its review of a State 
plan during the period established for that review, the Secretary will 
grant pre-award costs for the period after funds become available for 
obligation by the Secretary and before the State plan is found 
substantially approvable.
    (2) The period established for the Department's review of a plan 
does not include any day after the State has received notice that its 
plan is not substantially approvable.

    Note: The following examples describe how the regulations in 
Sec. 76.703 would be applied in certain circumstances. For the purpose 
of these examples, assume that the grant program established an April 1 
due date for the submission of the State plan and that funds are first 
available for obligation by the Secretary on July 1.

[[Page 167]]

    Example 1. Paragraph (d): A State submits a plan in substantially 
approvable form by April 1. The State may begin to obligate funds on 
July 1.
    Example 2. Paragraph (e)(1): A State submits a plan in substantially 
approvable form on May 15, and the Department notifies the State that 
the plan is substantially approvable on June 20. The State may begin to 
obligate funds on July 1.
    Example 3. Paragraph (e)(2)(i): A State submits a plan in 
substantially approvable form on May 15, and the Department notifies the 
State that the plan is substantially approvable on July 15. The State 
may begin to obligate funds on July 15.
    Example 4. Paragraph (e)(2)(ii)(A): A State submits a plan in 
substantially approvable form on May 15, and the Department notifies the 
State that the plan is substantially approvable on August 21. The State 
may begin to obligate funds on August 14. (In this example, the plan is 
45 days late. By adding 45 days to July 1, we reach August 14, which is 
earlier than the date, August 21, that the Department notifies the State 
that the plan is substantially approvable. Therefore, if the State chose 
to begin drawing funds from the Department on August 14, obligations 
made on or after that date would generally be allowable.)
    Example 5. Paragraph (e)(2)(i): A State submits a plan on May 15, 
and the Department notifies the State that the plan is not substantially 
approvable on July 10. The State submits changes that make the plan 
substantially approvable on July 20 and the Department notifies the 
State that the plan is substantially approvable on July 25. The State 
may begin to obligate funds on July 25. (In this example, the original 
submission is 45 days late. In addition, the Department notifies the 
State that the plan is not substantially approvable and the time from 
that notification until the State submits changes that make the plan 
substantially approvable is an additional 10 days. By adding 55 days to 
July 1, we reach August 24. However, since the Department notified the 
State that the plan was substantially approvable on July 25, that is the 
date that the State may begin to obligate funds.)
    Example 6. Paragraph (e)(2)(ii)(B): A State submits a plan on May 
15, and the Department notifies the State that the plan is not 
substantially approvable on August 1. The State submits changes that 
make the plan substantially approvable on August 20, and the Department 
notifies the State that the plan is substantially approvable on 
September 5. The State may choose to begin drawing funds from the 
Department on September 2, and obligations made on or after that date 
would generally be allowable. (In this example, the original submission 
is 45 days late. In addition, the Department notifies the State that the 
plan is not substantially approvable and the time from that notification 
until the State submits changes that make the plan substantially 
approvable is an additional 19 days. By adding 64 days to July 1, we 
reach September 2, which is earlier than September 5, the date that the 
Department notifies the State that the plan is substantially 
approvable.)
    Example 7. Paragraph (g): A State submits a plan on April 15 and the 
Department notifies the State that the plan is not substantially 
approvable on July 16. The State makes changes to the plan and submits a 
substantially approvable plan on July 30. The Department had until July 
15 to decide whether the plan was substantially approvable because the 
State was 15 days late in submitting the plan. The date the State may 
begin to obligate funds under the regulatory deferral is July 29 (based 
on the 15 day deferral for late submission plus a 14 day deferral for 
the time it took to submit a substantially approvable plan after having 
received notice). However, because the Department was one day late in 
completing its review of the plan, the State would get pre-award costs 
to cover the period of July 1 through July 29.

    (h) After determining that a State plan is in substantially 
approvable form, the Secretary informs the State of the date on which it 
could begin to obligate funds. Reimbursement for those obligations is 
subject to final approval of the State plan.

(Authority: 20 U.S.C. 1221e-3, 3474, 6511(a) and 31 U.S.C. 6503)

[45 FR 22517, Apr. 3, 1980. Redesignated at 45 FR 77368, Nov. 21, 1980, 
as amended at 60 FR 41294, Aug. 11, 1995; 61 FR 14484, Apr. 2, 1996]



Sec. 76.704  New State plan requirements that must be addressed 
in a State plan.

    (a) This section specifies the State plan requirements that must be 
addressed in a State plan if the State plan requirements established in 
statutes or regulations change on a date close to the date that State 
plans are due for submission to the Department.
    (b)(1) A State plan must meet the following requirements:
    (i) Every State plan requirement in effect three months before the 
date the State plan is due to be submitted to the Department under 34 
CFR 76.703; and
    (ii) Every State plan requirement included in statutes or 
regulations that will be effective on or before the date

[[Page 168]]

that funds become available for obligation by the Secretary and that 
have been signed into law or published in the Federal Register as final 
regulations three months before the date the State plan is due to be 
submitted to the Department under 34 CFR 76.703.
    (2) If a State plan does not have to meet a new State plan 
requirement under paragraph (b)(1) of this section, the Secretary takes 
one of the following actions:
    (i) Require the State to submit assurances and appropriate 
documentation to show that the new requirements are being followed under 
the program.
    (ii) Extend the date for submission of State plans and approve pre-
award costs as necessary to hold the State harmless.
    (3) If the Secretary requires a State to submit assurances under 
paragraph (b)(2) of this section, the State shall incorporate changes to 
the State plan as soon as possible to comply with the new requirements. 
The State shall submit the necessary changes before the start of the 
next obligation period.

(Authority: 20 U.S.C. 1221e-3, 3474, 6511(a) and 31 U.S.C. 6503)

[60 FR 41296, Aug. 11, 1995]



Sec. 76.707  When obligations are made.

    The following table shows when a State or a subgrantee makes 
obligations for various kinds of property and services.

------------------------------------------------------------------------
        If the obligation is for--            The obligation is made--
------------------------------------------------------------------------
(a) Acquisition of real or personal         On the date on which the
 property.                                   State or subgrantee makes a
                                             binding written commitment
                                             to acquire the property.
(b) Personal services by an employee of     When the services are
 the State or subgrantee.                    performed.
(c) Personal services by a contractor who   On the date on which the
 is not an employee of the State or          State or subgrantee makes a
 subgrantee.                                 binding written commitment
                                             to obtain the services.
(d) Performance of work other than          On the date on which the
 personal services.                          State or subgrantee makes a
                                             binding written commitment
                                             to obtain the work.
(e) Public utility services...............  When the State or subgrantee
                                             receives the services.
(f) Travel................................  When the travel is taken.
(g) Rental of real or personal property...  When the State or subgrantee
                                             uses the property.
(h) A pre-agreement cost that was properly  On the first day of the
 approved by the Secretary under the cost    grant or subgrant
 principles in 2 CFR part 200, Subpart E--   performance period.
 Cost Principles.
------------------------------------------------------------------------


(Authority: 20 U.S.C. 1221e-3, 3474, and 6511(a))

[45 FR 22517, Apr. 3, 1980. Redesignated at 45 FR 77368, Nov. 21, 1980, 
as amended at 55 FR 14817, Apr. 18, 1990; 57 FR 30342, July 8, 1992; 79 
FR 76094, Dec. 19, 2014]



Sec. 76.708  When certain subgrantees may begin to obligate funds.

    (a) If the authorizing statute for a program requires a State to 
make subgrants on the basis of a formula (see Sec. 76.5), the State may 
not authorize an applicant for a subgrant to obligate funds until the 
later of the following two dates:
    (1) The date that the State may begin to obligate funds under 
Sec. 76.703; or
    (2) The date that the applicant submits its application to the State 
in substantially approvable form.
    (b) Reimbursement for obligations under paragraph (a) of this 
section is subject to final approval of the application.
    (c) If the authorizing statute for a program gives the State 
discretion to select subgrantees, the State may not authorize an 
applicant for a subgrant to obligate funds until the subgrant is made. 
However, the State may approve pre-agreement costs in accordance with 
the cost principles in 2 CFR part 200, subpart E-Cost Principles.

(Authority: 20 U.S.C. 1221e-3, 3474, and 6511(a))

[45 FR 22517, Apr. 3, 1980. Redesignated at 45 FR 77368, Nov. 21, 1980. 
Further redesignated at 60 FR 41295, Aug. 11, 1995; 79 FR 76094, Dec. 
19, 2014]



Sec. 76.709  Funds may be obligated during a ``carryover period.''

    (a) If a State or a subgrantee does not obligate all of its grant or 
subgrant funds by the end of the fiscal year for which Congress 
appropriated the funds, it may obligate the remaining funds during a 
carryover period of one additional fiscal year.

[[Page 169]]

    (b) The State shall return to the Federal Government any carryover 
funds not obligated by the end of the carryover period by the State and 
its subgrantees.

    Note: This section is based on a provision in the General Education 
Provisions Act (GEPA). Section 427 of the Department of Education 
Organization Act (DEOA), 20 U.S.C. 3487, provides that except to the 
extent inconsistent with the DEOA, the GEPA ``shall apply to functions 
transferred by this Act to the extent applicable on the day preceding 
the effective date of this Act.'' Although standardized nomenclature is 
used in this section to reflect the creation of the Department of 
Education, there is no intent to extend the coverage of the GEPA beyond 
that authorized under section 427 or other applicable law.

(Authority: U.S.C. 1221e-3, 1225(b), and 3474)

[45 FR 22517, Apr. 3, 1980. Redesignated at 45 FR 77368, Nov. 21, 1980, 
as amended at 45 FR 86296, Dec. 30, 1980. Redesignated at 60 FR 41295, 
Aug. 11, 1995]



Sec. 76.710  Obligations made during a carryover period are subject 
to current statutes, regulations, and applications.

    A State and a subgrantee shall use carryover funds in accordance 
with:
    (a) The Federal statutes and regulations that apply to the program 
and are in effect for the carryover period; and
    (b) Any State plan, or application for a subgrant, that the State or 
subgrantee is required to submit for the carryover period.

    Note: This section is based on a provision in the General Education 
Provisions Act (GEPA). Section 427 of the Department of Education 
Organization Act (DEOA), 20 U.S.C. 3487, provides that except to the 
extent inconsistent with the DEOA, the GEPA ``shall apply to functions 
transferred by this Act to the extent applicable on the day preceding 
the effective date of this Act.'' Although standardized nomenclature is 
used in this section to reflect the creation of the Department of 
Education, there is no intent to extend the coverage of the GEPA beyond 
that authorized under section 427 or other applicable law.

(Authority: U.S.C. 1221e-3, 1225(b), and 3474)

[45 FR 22517, Apr. 3, 1980. Redesignated at 45 FR 77368, Nov. 21, 1980, 
as amended at 45 FR 86296, Dec. 30, 1980. Redesignated at 60 FR 41295, 
Aug. 11, 1995]



Sec. 76.711  Requesting funds by CFDA number.

    If a program is listed in the Catalog of Federal Domestic Assistance 
(CFDA), a State, when requesting funds under the program, shall identify 
that program by the CFDA number.

(Authority: 20 U.S.C. 1221e-3, 6511(a), 3474, 31 U.S.C. 6503)

[60 FR 41296, Aug. 11, 1995]



Sec. 76.712  Beneficiary protections: Written notice.

    (a) A faith-based organization that receives a grant, subgrant, or 
contract under a State-administered program of the Department supported 
in whole or in part by direct Federal financial assistance must give 
written notice to a beneficiary or prospective beneficiary of certain 
protections. This notice must state that:
    (1) The organization may not discriminate against a beneficiary or 
prospective beneficiary on the basis of religion, or religious belief, a 
refusal to hold a religious belief, or refusal to attend or participate 
in a religious practice;
    (2) The organization may not require a beneficiary to attend or 
participate in any explicitly religious activities that are offered by 
the organization, and any participation by the beneficiaries in such 
activities must be purely voluntary;
    (3) The organization must separate in time or location any privately 
funded explicitly religious activities from activities supported by 
direct Federal financial assistance;
    (4) If a beneficiary or prospective beneficiary objects to the 
religious character of the organization, the organization will undertake 
reasonable efforts to identify and refer the beneficiary to an 
alternative provider to which the beneficiary has no objection; and
    (5) A beneficiary or prospective beneficiary may report violations 
of these protections to, or may file a written complaint regarding a 
denial of services or benefits, with the State agency administering the 
program or subgrantee that made the award under which the violation 
occurred.

[[Page 170]]

    (b)(1) A faith-based organization that receives a subgrant or 
contract under a State-administered program of the Department must 
provide beneficiaries with the written notice required under paragraph 
(a) of this section prior to the time they enroll in or receive services 
from the organization.
    (2) When the nature of the services provided or exigent 
circumstances make it impracticable to provide the written notice in 
advance of the actual services, the organization must advise 
beneficiaries of their protections at the earliest available 
opportunity.
    (c) The notice that a faith-based organization must use to notify 
beneficiaries or prospective beneficiaries of their rights under 
paragraph (a) of this section is specified in appendix A to part 75.

(Authority: 20 U.S.C. 1221e-3 and 3474, E.O. 13559)

[Approved by the Office of Management and Budget under control number 
1895-0001]

[81 FR 19409, Apr. 4, 2016]



Sec. 76.713  Beneficiary protections: Referral requirements.

    (a) If a beneficiary or prospective beneficiary of a State-
administered program of the Department supported in whole or in part by 
direct Federal financial assistance objects to the religious character 
of a faith-based organization that provides services under the program, 
that organization must promptly undertake reasonable efforts to identify 
and refer the beneficiary to an alternative provider to which the 
beneficiary or prospective beneficiary has no objection.
    (b)(1) A faith-based organization may satisfy the requirement in 
paragraph (a) of this section by referring a beneficiary or prospective 
beneficiary to another faith-based organization if the beneficiary or 
prospective beneficiary does not object to that provider.
    (2) If the beneficiary or prospective beneficiary requests a secular 
provider, and one is available, the faith-based organization must make a 
referral to that provider.
    (c) The faith-based organization must make a referral to an 
alternative provider that--
    (1) Is in reasonable geographic proximity to the location where the 
beneficiary or prospective beneficiary is receiving or would receive 
services (except for services provided by telephone, internet, or 
similar means);
    (2) Offers services that are similar in substance and quality to 
those offered by the organization; and
    (3) Has the capacity to accept additional beneficiaries.
    (d)(1) When a faith-based organization makes a referral to an 
alternative provider, the organization must maintain a record of the 
referral in its grant records, including the date of the referral, the 
name of the alternative provider, its address, and contact information 
for the alternative provider.
    (2) When the organization determines that it is unable to identify 
an alternative provider, the organization must promptly notify the State 
or subgrantee that made the award under which the referral could not be 
made. If the organization is unable to identify an alternative provider, 
the State agency or subgrantee that made the award under which the 
referral could not be made must determine whether there is any other 
suitable alternative provider to which the beneficiary or prospective 
beneficiary may be referred. If the entity that made the award under 
which the referral could not be made cannot make a referral, that entity 
must promptly notify the grantee or the Department, as appropriate, and 
the grantee or the Department must determine whether a suitable referral 
can be made.

(Authority: 20 U.S.C. 1221e-3 and 3474, E.O. 13559)

[Approved by the Office of Management and Budget under control number 
1895-0001)

[81 FR 19409, Apr. 4, 2016]



Sec. 76.714  Subgrants, contracts, and other agreements with faith-
based organizations.

    If a grantee under a State-administered program of the Department 
has the authority under the grant or subgrant to select a private 
organization to provide services supported by direct Federal financial 
assistance under the program by subgrant, contract, or other agreement, 
the grantee

[[Page 171]]

must ensure compliance with applicable Federal requirements governing 
contracts, grants, and other agreements with faith-based organizations, 
including, as applicable, Secs. 76.52, 76.532, and 76.712-76.713 and 2 
CFR 3474.15. If the intermediary (pass-through) is a nongovernmental 
organization, it retains all other rights of a nongovernmental 
organization under the program's statutory and regulatory provisions.

(Authority: 20 U.S.C. 1221e-3 and 3474, E.O. 13559)

[81 FR 19409, Apr. 4, 2016]

                                 Reports



Sec. 76.720  State reporting requirements.

    (a) This section applies to a State's reports required under 2 CFR 
200.327 (Financial reporting) and 2 CFR 200.328 (Monitoring and 
reporting program performance), and other reports required by the 
Secretary and approved by the Office of Management and Budget (OMB) 
under the Paperwork Reduction Act of 1995, 44 U.S.C. 3501-3520.
    (b) A State must submit these reports annually unless--
    (1) The Secretary allows less frequent reporting; or
    (2) The Secretary requires a State to report more frequently than 
annually, including reporting under 2 CFR 3474.10 and 2 CFR 200.207 
(Specific conditions) and 2 CFR 3474.10 (Clarification regarding 2 CFR 
200.207) or 2 CFR 200.302 Financial management and 200.303 Internal 
controls.
    (c)(1) A State must submit these reports in the manner prescribed by 
the Secretary, including submitting any of these reports electronically 
and at the quality level specified in the data collection instrument.
    (2) Failure by a State to submit reports in accordance with 
paragraph (c)(1) of this section constitutes a failure, under section 
454 of the General Education Provisions Act, 20 U.S.C. 1234c, to comply 
substantially with a requirement of law applicable to the funds made 
available under that program.
    (3) For reports that the Secretary requires to be submitted in an 
electronic manner, the Secretary may establish a transition period of up 
to two years following the date the State otherwise would be required to 
report the data in the electronic manner, during which time a State will 
not be required to comply with that specific electronic submission 
requirement, if the State submits to the Secretary--
    (i) Evidence satisfactory to the Secretary that the State will not 
be able to comply with the electronic submission requirement specified 
by the Secretary in the data collection instrument on the first date the 
State otherwise would be required to report the data electronically;
    (ii) Information requested in the report through an alternative 
means that is acceptable to the Secretary, such as through an 
alternative electronic means; and
    (iii) A plan for submitting the reports in the required electronic 
manner and at the level of quality specified in the data collection 
instrument no later than the date two years after the first date the 
State otherwise would be required to report the data in the electronic 
manner prescribed by the Secretary.

(Authority: 20 U.S.C. 1221e-3, 1231a, and 3474)

[72 FR 3702, Jan. 25, 2007, as amended at 79 FR 76094, Dec. 19, 2014]



Sec. 76.722  Subgrantee reporting requirements.

    A State may require a subgrantee to submit reports in a manner and 
format that assists the State in complying with the requirements under 
34 CFR 76.720 and in carrying out other responsibilities under the 
program.

(Authority: 20 U.S.C. 1221e-3, 1231a, and 3474)

[72 FR 3703, Jan. 25, 2007]

                                 Records



Sec. 76.730  Records related to grant funds.

    A State and a subgrantee shall keep records that fully show:
    (a) The amount of funds under the grant or subgrant;
    (b) How the State or subgrantee uses the funds;
    (c) The total cost of the project;
    (d) The share of that cost provided from other sources; and

[[Page 172]]

    (e) Other records to facilitate an effective audit.

(Approved by the Office of Management and Budget under control number 
1880-0513)

(Authority: 20 U.S.C. 1232f)

[45 FR 22517, Apr. 3, 1980. Redesignated at 45 FR 77368, Nov. 21, 1980, 
as amended at 53 FR 49143, Dec. 6, 1988]



Sec. 76.731  Records related to compliance.

    A State and a subgrantee shall keep records to show its compliance 
with program requirements.

(Authority: 20 U.S.C. 1221e-3, 3474, and 6511(a))

                                 Privacy



Sec. 76.740  Protection of and access to student records; student 
rights in research, experimental programs, and testing.

    (a) Most records on present or past students are subject to the 
requirements of section 438 of GEPA and its implementing regulations 
under 34 CFR part 99. (Section 438 is the Family Educational Rights and 
Privacy Act of 1974.)
    (b) Under most programs administered by the Secretary, research, 
experimentation, and testing are subject to the requirements of section 
439 of GEPA and its implementing regulations at 34 CFR part 98.

(Authority: 20 U.S.C. 1221e-3, 1232g, 1232h, 3474, and 6511(a))

[45 FR 22517, Apr. 3, 1980. Redesignated at 45 FR 77368, Nov. 21, 1980, 
as amended at 57 FR 30342, July 8, 1992]

                 Use of Funds by States and Subgrantees



Sec. 76.760  More than one program may assist a single activity.

    A State or a subgrantee may use funds under more than one program to 
support different parts of the same project if the State or subgrantee 
meets the following conditions:
    (a) The State or subgrantee complies with the requirements of each 
program with respect to the part of the project assisted with funds 
under that program.
    (b) The State or subgrantee has an accounting system that permits 
identification of the costs paid for under each program.

(Authority: 20 U.S.C. 1221e-3, 3474, and 6511(a))



Sec. 76.761  Federal funds may pay 100 percent of cost.

    A State or a subgrantee may use program funds to pay up to 100 
percent of the cost of a project if:
    (a) The State or subgrantee is not required to match the funds; and
    (b) The project can be assisted under the authorizing statute and 
implementing regulations for the program.

(Authority: 20 U.S.C. 1221e-3, 3474, and 6511(a))

                  State Administrative Responsibilities



Sec. 76.770  A State shall have procedures to ensure compliance.

    Each State shall have procedures for reviewing and approving 
applications for subgrants and amendments to those applications, for 
providing technical assistance, for evaluating projects, and for 
performing other administrative responsibilities the State has 
determined are necessary to ensure compliance with applicable statutes 
and regulations.

(Authority: 20 U.S.C. 1221e-3 and 3474)

[57 FR 30342, July 8, 1992]



Sec. 76.783  State educational agency action--subgrantee's opportunity
for a hearing.

    (a) A subgrantee may request a hearing if it alleges that any of the 
following actions by the State educational agency violated a State or 
Federal statute or regulation:
    (1) Ordering, in accordance with a final State audit resolution 
determination, the repayment of misspent or misapplied Federal funds; or
    (2) Terminating further assistance for an approved project.
    (b) The procedures in Sec. 76.401(d)(2)-(7) apply to any request for 
a hearing under this section.

    Note: This section is based on a provision in the General Education 
Provisions Act (GEPA). Section 427 of the Department of

[[Page 173]]

Education Organization Act (DEOA), 20 U.S.C. 3487, provides that except 
to the extent inconsistent with the DEOA, the GEPA ``shall apply to 
functions transferred by this Act to the extent applicable on the day 
preceding the effective date of this Act.'' Although standardized 
nomenclature is used in this section to reflect the creation of the 
Department of Education, there is no intent to extend the coverage of 
the GEPA beyond that authorized under section 427 or other applicable 
law.

(Authority: 20 U.S.C. 1231b-2)

[45 FR 22517, Apr. 3, 1980. Redesignated at 45 FR 77368, Nov. 21, 1980, 
as amended at 45 FR 86296, Dec. 30, 1980; 57 FR 30342, July 8, 1992]



Subpart H_How Does a State or Local Educational Agency Allocate Funds to 
                            Charter Schools?

    Source: 64 FR 71965, Dec. 22, 1999, unless otherwise noted.

                                 General



Sec. 76.785  What is the purpose of this subpart?

    The regulations in this subpart implement section 10306 of the 
Elementary and Secondary Education Act of 1965 (ESEA), which requires 
States to take measures to ensure that each charter school in the State 
receives the funds for which it is eligible under a covered program 
during its first year of operation and during subsequent years in which 
the charter school expands its enrollment.

(Authority: 20 U.S.C. 8065a)



Sec. 76.786  What entities are governed by this subpart?

    The regulations in this subpart apply to--
    (a) State educational agencies (SEAs) and local educational agencies 
(LEAs) that fund charter schools under a covered program, including SEAs 
and LEAs located in States that do not participate in the Department's 
Public Charter Schools Program;
    (b) State agencies that are not SEAs, if they are responsible for 
administering a covered program. State agencies that are not SEAs must 
comply with the provisions in this subpart that are applicable to SEAs; 
and
    (c) Charter schools that are scheduled to open or significantly 
expand their enrollment during the academic year and wish to participate 
in a covered program.

(Authority: 20 U.S.C. 8065a)



Sec. 76.787  What definitions apply to this subpart?

    For purposes of this subpart--
    Academic year means the regular school year (as defined by State 
law, policy, or practice) and for which the State allocates funds under 
a covered program.
    Charter school has the same meaning as provided in title X, part C 
of the ESEA.
    Charter school LEA means a charter school that is treated as a local 
educational agency for purposes of the applicable covered program.
    Covered program means an elementary or secondary education program 
administered by the Department under which the Secretary allocates funds 
to States on a formula basis, except that the term does not include a 
program or portion of a program under which an SEA awards subgrants on a 
discretionary, noncompetitive basis.
    Local educational agency has the same meaning for each covered 
program as provided in the authorizing statute for the program.
    Significant expansion of enrollment means a substantial increase in 
the number of students attending a charter school due to a significant 
event that is unlikely to occur on a regular basis, such as the addition 
of one or more grades or educational programs in major curriculum areas. 
The term also includes any other expansion of enrollment that the SEA 
determines to be significant.

(Authority: 20 U.S.C. 8065a)

               Reponsibilities for Notice and Information



Sec. 76.788  What are a charter school LEA's responsibilities under 
this subpart?

    (a) Notice. At least 120 days before the date a charter school LEA 
is scheduled to open or significantly expand its enrollment, the charter 
school LEA or its authorized public chartering agency

[[Page 174]]

must provide its SEA with written notification of that date.
    (b) Information. (1) In order to receive funds, a charter school LEA 
must provide to the SEA any available data or information that the SEA 
may reasonably require to assist the SEA in estimating the amount of 
funds the charter school LEA may be eligible to receive under a covered 
program.
    (2)(i) Once a charter school LEA has opened or significantly 
expanded its enrollment, the charter school LEA must provide actual 
enrollment and eligibility data to the SEA at a time the SEA may 
reasonably require.
    (ii) An SEA is not required to provide funds to a charter school LEA 
until the charter school LEA provides the SEA with the required actual 
enrollment and eligibility data.
    (c) Compliance. Except as provided in Sec. 76.791(a), or the 
authorizing statute or implementing regulations for the applicable 
covered program, a charter school LEA must establish its eligibility and 
comply with all applicable program requirements on the same basis as 
other LEAs.

(Approved by the Office of Management and Budget under control number 
1810-0623)

(Authority: 20 U.S.C. 8065a)



Sec. 76.789  What are an SEA's responsibilities under this subpart?

    (a) Information. Upon receiving notice under Sec. 76.788(a) of the 
date a charter school LEA is scheduled to open or significantly expand 
its enrollment, an SEA must provide the charter school LEA with timely 
and meaningful information about each covered program in which the 
charter school LEA may be eligible to participate, including notice of 
any upcoming competitions under the program.
    (b) Allocation of Funds. (1) An SEA must allocate funds under a 
covered program in accordance with this subpart to any charter school 
LEA that--
    (i) Opens for the first time or significantly expands its enrollment 
during an academic year for which the State awards funds by formula or 
through a competition under the program;
    (ii) In accordance with Sec. 76.791(a), establishes its eligibility 
and complies with all applicable program requirements; and
    (iii) Meets the requirements of Sec. 76.788(a).
    (2) In order to meet the requirements of this subpart, an SEA may 
allocate funds to, or reserve funds for, an eligible charter school LEA 
based on reasonable estimates of projected enrollment at the charter 
school LEA.
    (3)(i) The failure of an eligible charter school LEA or its 
authorized public chartering agency to provide notice to its SEA in 
accordance with Sec. 76.788(a) relieves the SEA of any obligation to 
allocate funds to the charter school within five months.
    (ii) Except as provided in Sec. 76.792(c), an SEA that receives less 
than 120 days' actual notice of the date an eligible charter school LEA 
is scheduled to open or significantly expand its enrollment must 
allocate funds to the charter school LEA on or before the date the SEA 
allocates funds to LEAs under the applicable covered program for the 
succeeding academic year.
    (iii) The SEA may provide funds to the charter school LEA from the 
SEA's allocation under the applicable covered program for the academic 
year in which the charter school LEA opened or significantly expanded 
its enrollment, or from the SEA's allocation under the program for the 
succeeding academic year.

(Approved by the Office of Management and Budget under control number 
1810-0623)

(Authority: 20 U.S.C. 8065a)

            Allocation of Funds by State Educational Agencies



Sec. 76.791  On what basis does an SEA determine whether a charter 
school LEA that opens or significantly expands its enrollment is 
eligible to receive funds under a covered program?

    (a) For purposes of this subpart, an SEA must determine whether a 
charter school LEA is eligible to receive funds under a covered program 
based on actual enrollment or other eligibility data for the charter 
school LEA on or after the date the charter school LEA opens or 
significantly expands its enrollment.
    (b) For the year the charter school LEA opens or significantly 
expands its

[[Page 175]]

enrollment, the eligibility determination may not be based on enrollment 
or eligibility data from a prior year, even if the SEA makes eligibility 
determinations for other LEAs under the program based on enrollment or 
eligibility data from a prior year.

(Authority: 20 U.S.C. 8065a)



Sec. 76.792  How does an SEA allocate funds to eligible charter school
LEAs under a covered program in which the SEA awards subgrants on a
formula basis?

    (a) For each eligible charter school LEA that opens or significantly 
expands its enrollment on or before November 1 of an academic year, the 
SEA must implement procedures that ensure that the charter school LEA 
receives the proportionate amount of funds for which the charter school 
LEA is eligible under each covered program.
    (b) For each eligible charter school LEA that opens or significantly 
expands its enrollment after November 1 but before February 1 of an 
academic year, the SEA must implement procedures that ensure that the 
charter school LEA receives at least a pro rata portion of the 
proportionate amount of funds for which the charter school LEA is 
eligible under each covered program. The pro rata amount must be based 
on the number of months or days during the academic year the charter 
school LEA will participate in the program as compared to the total 
number of months or days in the academic year.
    (c) For each eligible charter school LEA that opens or significantly 
expands its enrollment on or after February 1 of an academic year, the 
SEA may implement procedures to provide the charter school LEA with a 
pro rata portion of the proportionate amount of funds for which the 
charter school LEA is eligible under each covered program.

(Authority: 20 U.S.C. 8065a)



Sec. 76.793  When is an SEA required to allocate funds to a charter
school LEA under this subpart?

    Except as provided in Secs. 76.788(b) and 76.789(b)(3):
    (a) For each eligible charter school LEA that opens or significantly 
expands its enrollment on or before November 1 of an academic year, the 
SEA must allocate funds to the charter school LEA within five months of 
the date the charter school LEA opens or significantly expands its 
enrollment; and
    (b)(1) For each eligible charter school LEA that opens or 
significantly expands its enrollment after November 1, but before 
February 1 of an academic year, the SEA must allocate funds to the 
charter school LEA on or before the date the SEA allocates funds to LEAs 
under the applicable covered program for the succeeding academic year.
    (2) The SEA may provide funds to the charter school LEA from the 
SEA's allocation under the program for the academic year in which the 
charter school LEA opened or significantly expanded its enrollment, or 
from the SEA's allocation under the program for the succeeding academic 
year.

(Authority: 20 U.S.C. 8065a)



Sec. 76.794  How does an SEA allocate funds to charter school LEAs
under a covered program in which the SEA awards subgrants on a 
discretionary basis?

    (a) Competitive programs. (1) For covered programs in which the SEA 
awards subgrants on a competitive basis, the SEA must provide each 
eligible charter school LEA in the State that is scheduled to open on or 
before the closing date of any competition under the program a full and 
fair opportunity to apply to participate in the program.
    (2) An SEA is not required to delay the competitive process in order 
to allow a charter school LEA that has not yet opened or significantly 
expanded its enrollment to compete for funds under a covered program.
    (b) Noncompetitive discretionary programs. The requirements in this 
subpart do not apply to discretionary programs or portions of programs 
under which the SEA does not award subgrants through a competition.

(Authority: 20 U.S.C. 8065a)

[[Page 176]]

                               Adjustments



Sec. 76.796  What are the consequences of an SEA allocating more or 
fewer funds to a charter school LEA under a covered program than the 
amount for which the charter school LEA is eligible when the charter
school LEA actually opens or significantly expands its enrollment?

    (a) An SEA that allocates more or fewer funds to a charter school 
LEA than the amount for which the charter school LEA is eligible, based 
on actual enrollment or eligibility data when the charter school LEA 
opens or significantly expands its enrollment, must make appropriate 
adjustments to the amount of funds allocated to the charter school LEA 
as well as to other LEAs under the applicable program.
    (b) Any adjustments to allocations to charter school LEAs under this 
subpart must be based on actual enrollment or other eligibility data for 
the charter school LEA on or after the date the charter school LEA first 
opens or significantly expands its enrollment, even if allocations or 
adjustments to allocations to other LEAs in the State are based on 
enrollment or eligibility data from a prior year.

(Authority: 20 U.S.C. 8065a)



Sec. 76.797  When is an SEA required to make adjustments to 
allocations under this subpart?

    (a) The SEA must make any necessary adjustments to allocations under 
a covered program on or before the date the SEA allocates funds to LEAs 
under the program for the succeeding academic year.
    (b) In allocating funds to a charter school LEA based on adjustments 
made in accordance with paragraph (a) of this section, the SEA may use 
funds from the SEA's allocation under the applicable covered program for 
the academic year in which the charter school LEA opened or 
significantly expanded its enrollment, or from the SEA's allocation 
under the program for the succeeding academic year.

(Authority: 20 U.S.C. 8065a)

       Applicability of This Subpart to Local Educational Agencies



Sec. 76.799  Do the requirements in this subpart apply to LEAs?

    (a) Each LEA that is responsible for funding a charter school under 
a covered program must comply with the requirements in this subpart on 
the same basis as SEAs are required to comply with the requirements in 
this subpart.
    (b) In applying the requirements in this subpart (except for 
Secs. 76.785, 76.786, and 76.787) to LEAs, references to SEA (or State), 
charter school LEA, and LEA must be read as references to LEA, charter 
school, and public school, respectively.

(Authority: 20 U.S.C. 8065a)



   Subpart I_What Procedures Does the Secretary Use To Get
   Compliance?

    Source: 45 FR 22517, Apr. 3, 1980, unless otherwise noted. 
Redesignated at 45 FR 77368, Nov. 21, 1980, and further redesignated at 
64 FR 71965, Dec. 22, 1999.



Sec. 76.900  Waiver of regulations prohibited.

    (a) No official, agent, or employee of ED may waive any regulation 
that applies to a Department program unless the regulation specifically 
provide that it may be waived.
    (b) No act or failure to act by an official, agent, or employee of 
ED can affect the authority of the Secretary to enforce regulations.

(Authority: 43 Dec. Comp. Gen. 31(1963))



Sec. 76.901  Office of Administrative Law Judges.

    (a) The Office of Administrative Law Judges, established under Part 
E of GEPA, has the following functions:
    (1) Recovery of funds hearings under section 452 of GEPA.
    (2) Withholding hearings under section 455 of GEPA.
    (3) Cease and desist hearings under section 456 of GEPA.
    (4) Any other proceeding designated by the Secretary under section 
451 of GEPA.

[[Page 177]]

    (b) The regulations of the Office of Administrative Law Judges are 
at 34 CFR part 81.

(Authority: 20 U.S.C. 1234)

[57 FR 30342, July 8, 1992]



Sec. 76.902  Judicial review.

    After a hearing by the Secretary, a State is usually entitled--
generally by the statute that required the hearing--to judicial review 
of the Secretary's decision.

(Authority: 20 U.S.C. 1221e-3, 3474, and 6511(a))



Sec. 76.910  Cooperation with audits.

    A grantee or subgrantee shall cooperate with the Secretary and the 
Comptroller General of the United States or any of their authorized 
representatives in the conduct of audits authorized by Federal law. This 
cooperation includes access without unreasonable restrictions to records 
and personnel of the grantee or subgrantee for the purpose of obtaining 
relevant information.

(Authority: 5 U.S.C. appendix 3, sections 4(a)(1), 4(b)(1)(A), and 
6(a)(1); 20 U.S.C. 1221e-3(a)(1), 1232f)

[54 FR 21776, May 19, 1989]



PART 77_DEFINITIONS THAT APPLY TO DEPARTMENT REGULATIONS--
Table of Contents



    Authority: 20 U.S.C. 1221e-3 and 3474, unless otherwise noted.



Sec. 77.1  Definitions that apply to all Department programs.

    (a) [Reserved]
    (b) Unless a statute or regulation provides otherwise, the following 
definitions in 2 CFR part 200 apply to the regulations in title 34 of 
the Code of Federal Regulations. The section of 2 CFR part 200 that 
contains the definition is given in parentheses as well as references to 
the term or terms used in title 34 that are consistent with the term 
defined in title 2.
    Contract (2 CFR 200.22).
    Equipment (2 CFR 200.33).
    Federal award (2 CFR 200.38) (The terms ``award,'' ``grant,'' and 
``subgrant'', as defined in paragraph (c) of this section, have the same 
meaning, depending on the context, as ``Federal award'' in 2 CFR 
200.38.).
    Period of performance (2 CFR 200.77) (For discretionary grants, ED 
uses the term ``project period,'' as defined in paragraph (c) of this 
section, instead of ``period of performance'' to describe the period 
during which funds can be obligated.).
    Personal property (2 CFR 200.78).
    Real property (2 CFR 200.85).
    Recipient (2 CFR 200.86).
    Subaward (2 CFR 200.92) (The term ``subgrant,'' as defined in 
paragraph (c) of this section, has the same meaning as ``subaward'' in 2 
CFR 200.92).
    Supplies (2 CFR 200.94).
    (c) Unless a statute or regulation provides otherwise, the following 
definitions also apply to the regulations in this title:
    Acquisition means taking ownership of property, receiving the 
property as a gift, entering into a lease-purchase arrangement, or 
leasing the property. The term includes processing, delivery, and 
installation of property.
    Ambitious means promoting continued, meaningful improvement for 
program participants or for other individuals or entities affected by 
the grant, or representing a significant advancement in the field of 
education research, practices, or methodologies. When used to describe a 
performance target, whether a performance target is ambitious depends 
upon the context of the relevant performance measure and the baseline 
for that measure.
    Applicant means a party requesting a grant or subgrant under a 
program of the Department.
    Application means a request for a grant or subgrant under a program 
of the Department.
    Award has the same meaning as the definition of ``Grant'' in this 
paragraph (c).
    Baseline means the starting point from which performance is measured 
and targets are set.
    Budget means that recipient's financial plan for carrying out the 
project or program.
    Budget period means an interval of time into which a project period 
is divided for budgetary purposes.
    Department means the U.S. Department of Education.

[[Page 178]]

    Direct grant program means any grant program of the Department other 
than a program whose authorizing statute or implementing regulations 
provide a formula for allocating program funds among eligible States.
    Cross Reference: See 34 CFR 75.1(b).
    Director of the Institute of Musuem Services means the Director of 
the Institute of Museum Services or an officer or employee of the 
Institute of Museum Services acting for the Director under a delegation 
of authority.
    Director of the National Institute of Education means the Director 
of the National Institute of Education or an officer or employee of the 
National Institute of Education acting for the Director under a 
delegation of authority.
    ED means the U.S. Department of Education.
    EDGAR means the Education Department General Administrative 
Regulations (34 CFR parts 75, 76, 77, 79, 81, 82, 84, 86, 97, 98, and 
99).
    Elementary school means a day or residential school that provides 
elementary education, as determined under State law.
    Evidence of promise means there is empirical evidence to support the 
theoretical linkage(s) between at least one critical component and at 
least one relevant outcome presented in the logic model for the proposed 
process, product, strategy, or practice. Specifically, evidence of 
promise means the conditions in both paragraphs (i) and (ii) of this 
definition are met:
    (i) There is at least one study that is a--
    (A) Correlational study with statistical controls for selection 
bias;
    (B) Quasi-experimental design study that meets the What Works 
Clearinghouse Evidence Standards with reservations; or
    (C) Randomized controlled trial that meets the What Works 
Clearinghouse Evidence Standards with or without reservations.
    (ii) The study referenced in paragraph (i) of this definition found 
a statistically significant or substantively important (defined as a 
difference of 0.25 standard deviations or larger) favorable association 
between at least one critical component and one relevant outcome 
presented in the logic model for the proposed process, product, 
strategy, or practice.
    Facilities means one or more structures in one or more locations.
    Fiscal year means the Federal fiscal year--a period beginning on 
October 1 and ending on the following September 30.
    GEPA means The General Education Provisions Act.
    Grant means financial assistance, including cooperative agreements, 
that provides support or stimulation to accomplish a public purpose. 2 
CFR part 200, as adopted in 2 CFR part 3474, uses the broader, undefined 
term ``Award'' to cover grants, subgrants, and other agreements in the 
form of money or property, in lieu of money, by the Federal Government 
to an eligible recipient. The term does not include--
    (1) Technical assistance, which provides services instead of money;
    (2) Other assistance in the form of loans, loan guarantees, interest 
subsidies, or insurance;
    (3) Direct payments of any kind to individuals; and
    (4) Contracts that are required to be entered into and administered 
under procurement laws and regulations.
    Grantee means the legal entity to which a grant is awarded and that 
is accountable to the Federal Government for the use of the funds 
provided. The grantee is the entire legal entity even if only a 
particular component of the entity is designated in the grant award 
notice (GAN). For example, a GAN may name as the grantee one school or 
campus of a university. In this case, the granting agency usually 
intends, or actually intends, that the named component assume primary or 
sole responsibility for administering the grant-assisted project or 
program. Nevertheless, the naming of a component of a legal entity as 
the grantee in a grant award document shall not be construed as 
relieving the whole legal entity from accountability to the Federal 
Government for the use of the funds provided. (This definition is not 
intended to affect the eligibility provision of grant programs in which 
eligibility is limited to organizations that may be only components of a 
legal entity.) The term ``grantee'' does not include any secondary 
recipients, such as

[[Page 179]]

subgrantees and contractors, that may receive funds from a grantee 
pursuant to a subgrant or contract.
    Grant period means the period for which funds have been awarded.
    Large sample means an analytic sample of 350 or more students (or 
other single analysis units), or 50 or more groups (such as classrooms 
or schools) that contain 10 or more students (or other single analysis 
units).
    Local educational agency means:
    (a) A public board of education or other public authority legally 
constituted within a State for either administrative control of or 
direction of, or to perform service functions for, public elementary or 
secondary schools in:
    (1) A city, county, township, school district, or other political 
subdivision of a State; or
    (2) Such combination of school districts or counties a State 
recognizes as an administrative agency for its public elementary or 
secondary schools; or
    (b) Any other public institution or agency that has administrative 
control and direction of a public elementary or secondary school.
    (c) As used in 34 CFR parts 400, 408, 525, 526 and 527 (vocational 
education programs), the term also includes any other public institution 
or agency that has administrative control and direction of a vocational 
education program.
    Logic model (also referred to as theory of action) means a well-
specified conceptual framework that identifies key components of the 
proposed process, product, strategy, or practice (i.e., the active 
``ingredients'' that are hypothesized to be critical to achieving the 
relevant outcomes) and describes the relationships among the key 
components and outcomes, theoretically and operationally.
    Minor remodeling means minor alterations in a previously completed 
building. The term also includes the extension of utility lines, such as 
water and electricity, from points beyond the confines of the space in 
which the minor remodeling is undertaken but within the confines of the 
previously completed building. The term does not include building 
construction, stuctural alterations to buildings, building maintenance, 
or repairs.
    Moderate evidence of effectiveness means one of the following 
conditions is met:
    (i) There is at least one study of the effectiveness of the process, 
product, strategy, or practice being proposed that meets the What Works 
Clearinghouse Evidence Standards without reservations, found a 
statistically significant favorable impact on a relevant outcome (with 
no statistically significant and overriding unfavorable impacts on that 
outcome for relevant populations in the study or in other studies of the 
intervention reviewed by and reported on by the What Works 
Clearinghouse), and includes a sample that overlaps with the populations 
or settings proposed to receive the process, product, strategy, or 
practice.
    (ii) There is at least one study of the effectiveness of the 
process, product, strategy, or practice being proposed that meets the 
What Works Clearinghouse Evidence Standards with reservations, found a 
statistically significant favorable impact on a relevant outcome (with 
no statistically significant and overriding unfavorable impacts on that 
outcome for relevant populations in the study or in other studies of the 
intervention reviewed by and reported on by the What Works 
Clearinghouse), includes a sample that overlaps with the populations or 
settings proposed to receive the process, product, strategy, or 
practice, and includes a large sample and a multi-site sample.

    Note: Multiple studies can cumulatively meet the large and multi-
site sample requirements as long as each study meets the other 
requirements in this paragraph.

    Multi-site sample means more than one site, where site can be 
defined as an LEA, locality, or State.
    National level describes the level of scope or effectiveness of a 
process, product, strategy, or practice that is able to be effective in 
a wide variety of communities, including rural and urban areas, as well 
as with different groups (e.g., economically disadvantaged, racial and 
ethnic groups, migrant populations, individuals with disabilities, 
English learners, and individuals of each gender).

[[Page 180]]

    Nonprofit, as applied to an agency, organization, or institution, 
means that it is owned and operated by one or more corporations or 
associations whose net earnings do not benefit, and cannot lawfully 
benefit, any private shareholder or entity.
    Nonpublic, as applied to an agency, organization, or institution, 
means that the agency, organization, or institution is nonprofit and is 
not under Federal or public supervision or control.
    Performance measure means any quantitative indicator, statistic, or 
metric used to gauge program or project performance.
    Performance target means a level of performance that an applicant 
would seek to meet during the course of a project or as a result of a 
project.
    Preschool means the educational level from a child's birth to the 
time at which the State provides elementary education.
    Private, as applied to an agency, organization, or institution, 
means that it is not under Federal or public supervision or control.
    Project means the activity described in an application.
    Project period means the period established in the award document 
during which Federal sponsorship begins and ends (See, 2 CFR 200.77 
Period of performance).
    Public, as applied to an agency, organization, or institution, means 
that the agency, organization, or institution is under the 
administrative supervision or control of a government other than the 
Federal Government.
    Quasi-experimental design study means a study using a design that 
attempts to approximate an experimental design by identifying a 
comparison group that is similar to the treatment group in important 
respects. These studies, depending on design and implementation, can 
meet What Works Clearinghouse Evidence Standards with reservations (but 
not What Works Clearinghouse Evidence Standards without reservations).
    Randomized controlled trial means a study that employs random 
assignment of, for example, students, teachers, classrooms, schools, or 
districts to receive the intervention being evaluated (the treatment 
group) or not to receive the intervention (the control group). The 
estimated effectiveness of the intervention is the difference between 
the average outcomes for the treatment group and for the control group. 
These studies, depending on design and implementation, can meet What 
Works Clearinghouse Evidence Standards without reservations.
    Regional level describes the level of scope or effectiveness of a 
process, product, strategy, or practice that is able to serve a variety 
of communities within a State or multiple States, including rural and 
urban areas, as well as with different groups (e.g., economically 
disadvantaged, racial and ethnic groups, migrant populations, 
individuals with disabilities, English learners, and individuals of each 
gender). For an LEA-based project, to be considered a regional-level 
project, a process, product, strategy, or practice must serve students 
in more than one LEA, unless the process, product, strategy, or practice 
is implemented in a State in which the State educational agency is the 
sole educational agency for all schools.
    Relevant outcome means the student outcome(s) (or the ultimate 
outcome if not related to students) the proposed process, product, 
strategy, or practice is designed to improve; consistent with the 
specific goals of a program.
    Secondary school means a day or residential school that provides 
secondary education as determined under State law. In the absence of 
State law, the Secretary may determine, with respect to that State, 
whether the term includes education beyond the twelfth grade.
    Secretary means the Secretary of the Department of Education or an 
official or employee of the Department acting for the Secretary under a 
delegation of authority.
    Service function, with respect to a local educational agency:
    (a) Means an educational service that is performed by a legal 
entity--such as an intermediate agency:
    (1)(i) Whose jurisdiction does not extend to the whole State; and
    (ii) That is authorized to provide consultative, advisory, or 
educational services to public elementary or secondary schools; or

[[Page 181]]

    (2) That has regulatory functions over agencies having 
administrative control or direction of public elementary or secondary 
schools.
    (b) The term does not include a service that is performed by a 
cultural or educational resource.
    State means any of the 50 States, the Commonwealth of Puerto Rico, 
the District of Columbia, Guam, American Samoa, the Virgin Islands, the 
Northern Mariana Islands, or the Trust Territory of the Pacific Islands.
    State educational agency means the State board of education or other 
agency or officer primarily responsible for the supervision of public 
elementary and secondary schools in a State. In the absence of this 
officer or agency, it is an officer or agency designated by the Governor 
or State law.
    Strong evidence of effectiveness means one of the following 
conditions is met:
    (i) There is at least one study of the effectiveness of the process, 
product, strategy, or practice being proposed that meets the What Works 
Clearinghouse Evidence Standards without reservations, found a 
statistically significant favorable impact on a relevant outcome (with 
no statistically significant and overriding unfavorable impacts on that 
outcome for relevant populations in the study or in other studies of the 
intervention reviewed by and reported on by the What Works 
Clearinghouse), includes a sample that overlaps with the populations and 
settings proposed to receive the process, product, strategy, or 
practice, and includes a large sample and a multi-site sample.

    Note: Multiple studies can cumulatively meet the large and multi-
site sample requirements as long as each study meets the other 
requirements in this paragraph.

    (ii) There are at least two studies of the effectiveness of the 
process, product, strategy, or practice being proposed, each of which: 
Meets the What Works Clearinghouse Evidence Standards with reservations, 
found a statistically significant favorable impact on a relevant outcome 
(with no statistically significant and overriding unfavorable impacts on 
that outcome for relevant populations in the studies or in other studies 
of the intervention reviewed by and reported on by the What Works 
Clearinghouse), includes a sample that overlaps with the populations and 
settings proposed to receive the process, product, strategy, or 
practice, and includes a large sample and a multi-site sample.
    Strong theory means a rationale for the proposed process, product, 
strategy, or practice that includes a logic model.
    Subgrant means an award of financial assistance in the form of 
money, or property in lieu of money, made under a grant by a grantee to 
an eligible subgrantee. The term includes financial assistance when 
provided by contractual or any other form of legal agreement, but does 
not include procurement purchases, nor does it include any form of 
assistance that is excluded from the definition of ``grant or award'' in 
this part (See 2 CFR 200.92, ``Subaward'').
    Subgrantee means the government or other legal entity to which a 
subgrant is awarded and that is accountable to the grantee for the use 
of the funds provided.
    What Works Clearinghouse Evidence Standards means the standards set 
forth in the What Works Clearinghouse Procedures and Standards Handbook 
(Version 3.0, March 2014), which can be found at the following link: 
http://ies.ed.gov/ncee/wwc/DocumentSum.aspx?sid=19.
    Work of art means an item that is incorporated into facilities 
primarily because of its aesthetic value.

(Authority: 20 U.S.C. 1221e-3(a)(1), 2831(a), 2974(b), and 3474)

[45 FR 22529, Apr. 3, 1980, as amended at 45 FR 37442, June 3, 1980. 
Redesignated at 45 FR 77368, Nov. 21, 1980, as amended at 45 FR 86298, 
Dec. 30, 1980; 54 FR 21776, May 19, 1989; 57 FR 30342, July 8, 1992; 59 
FR 34739, July 6, 1994; 64 FR 50392, Sept. 16, 1999; 77 FR 18679, Mar. 
28, 2012; 78 FR 49355, Aug. 13, 2013; 79 FR 76094, Dec. 19, 2014; 80 FR 
2608, Jan. 20, 2015]



PART 79_INTERGOVERNMENTAL REVIEW OF DEPARTMENT OF EDUCATION PROGRAMS 
AND ACTIVITIES--Table of Contents



Sec.
79.1  What is the purpose of these regulations?

[[Page 182]]

79.2  What definitions apply to these regulations?
79.3  What programs and activities of the Department are subject to 
          these regulations?
79.4  What are the Secretary's general responsibilities under the Order?
79.5  What is the Secretary's obligation with respect to Federal 
          interagency coordinations?
79.6  What procedures apply to the selection of programs and activities 
          under these regulations?
79.7  How does the Secretary communicate with State and local officials 
          concerning the Department's programs and activities?
79.8  How does the Secretary provide States an opportunity to comment on 
          proposed Federal financial assistance?
79.9  How does the Secretary receive and respond to comments?
79.10  How does the Secretary make efforts to accommodate 
          intergovernmental concerns?
79.11  What are the Secretary's obligations in interstate situations?
79.12  How may a State simplify, consolidate, or substitute federally 
          required State plans?
79.13  [Reserved]

    Authority: 31 U.S.C. 6506; 42 U.S.C. 3334; and E.O. 12372, unless 
otherwise noted.

    Source: 48 FR 29166, June 24, 1983, unless otherwise noted.



Sec. 79.1  What is the purpose of these regulations?

    (a) The regulations in this part implement Executive Order 12372, 
``Intergovernmental Review of Federal Programs,'' issued July 14, 1982 
and amended on April 8, 1983. These regulations also implement 
applicable provisions of Section 401 of the Intergovernmental 
Cooperation Act of 1968 and Section 204 of the Demonstration Cities and 
Metropolitan Development Act of 1966.
    (b) These regulations are intended to foster an intergovernmental 
partnership and a strengthened Federalism by relying on state processes 
and on state, areawide, regional, and local coordination for review of 
proposed federal financial assistance.
    (c) These regulations are intended to aid the internal management of 
the Department, and are not intended to create any right or benefit 
enforceable at law by a party against the Department or its officers.

(Authority: E.O. 12372)



Sec. 79.2  What definitions apply to these regulations?

    Department means the U.S. Department of Education.
    Order means Executive Order 12372, issued July 14, 1982, amended 
April 8, 1983, and titled ``Intergovernmental Review of Federal 
Programs.''
    Secretary means the Secretary of the U.S. Department of Education or 
an official or employee of the Department acting for the Secretary under 
a delegation of authority.
    State means any of the 50 states, the District of Columbia, the 
Commonwealth of Puerto Rico, the Commonwealth of the Northern Mariana 
Islands, Guam, American Samoa, the U.S. Virgin Islands, or the Trust 
Territory of the Pacific Islands.

(Authority: E.O. 12372)



Sec. 79.3  What programs and activities of the Department are subject
to these regulations?

    (a) The Secretary publishes in the Federal Register a list of the 
Department's programs and activities that are subject to these 
regulations and identifies which of these are subject to the 
requirements of section 204 of the Demonstration Cities and Metropolitan 
Development Act.
    (b) If a program or activity of the Department that provides Federal 
financial assistance does not have implementing regulations, the 
regulations in this part apply to that program or activity.
    (c) The following programs and activities are excluded from coverage 
under this part:
    (1) Proposed legislation.
    (2) Regulation and budget formulation.
    (3) National security matters.
    (4) Procurement.
    (5) Direct payments to individuals.
    (6) Financial transfers for which the Department has no funding 
discretion or direct authority to approve specific sites or projects 
(e.g., block grants under Chapter 2 of the Education Consolidation and 
Improvement Act of 1981).
    (7) Research and development national in scope.
    (8) Assistance to federally recognized Indian tribes.

[[Page 183]]

    (d) In addition to the programs and activities excluded in paragraph 
(c) of this section, the Secretary may only exclude a Federal financial 
assistance program or activity from coverage under this part if the 
program or activity does not directly affect State or local governments.

(Authority: E.O. 12372)

[48 FR 29166, June 24, 1983, as amended at 51 FR 20824, June 9, 1986]



Sec. 79.4  What are the Secretary's general responsibilities under
the Order?

    (a) The Secretary provides opportunities for consultation by elected 
officials of those state and local governments that would provide the 
nonfederal funds for, or that would be directly affected by, proposed 
federal financial assistance from the Department.
    (b) If a state adopts a process under the Order to review and 
coordinate proposed federal financial assistance, the Secretary, to the 
extent permitted by law:
    (1) Uses the state process to determine official views of state and 
local elected officials;
    (2) Communicates with state and local elected officials as early in 
a program planning cycle as is reasonably feasible to explain specific 
plans and actions;
    (3) Makes efforts to accommodate state and local elected official's 
concerns with proposed federal financial assistance that are 
communicated through the state process;
    (4) Allows the states to simplify and consolidate existing federally 
required state plan submissions;
    (5) Where state planning and budgeting systems are sufficient and 
where permitted by law, encourages the substitution of state plans for 
federally required state plans;
    (6) Seeks the coordination of views of affected state and local 
elected officials in one state with those of another state when proposed 
federal financial assistance has an impact on interstate metropolitan 
urban centers or other interstate areas; and
    (7) Supports state and local governments by discouraging the 
reauthorization or creation of any planning organization which is 
federally funded, which has a limited purpose, and which is not 
adequately representative of, or accountable to, state or local elected 
officials.

(Authority: E.O. 12372, Sec. 2)



Sec. 79.5  What is the Secretary's obligation with respect to Federal
interagency coordination?

    The Secretary, to the maximum extent practicable, consults with and 
seeks advice from all other substantially affected federal departments 
and agencies in an effort to assure full coordination between such 
agencies and the Department regarding programs and activities covered 
under these regulations.

(Authority: E.O. 12372)



Sec. 79.6  What procedures apply to the selection of programs and 
activities under these regulations?

    (a) A state may select any program or activity published in the 
Federal Register in accordance with Sec. 79.3 for intergovernmental 
review under these regulations. Each state, before selecting programs 
and activities, shall consult with local elected officials.
    (b) Each state that adopts a process shall notify the Secretary of 
the Department's programs and activities selected for that process.
    (c) A state may notify the Secretary of changes in its selections at 
any time. For each change, the state shall submit to the Secretary an 
assurance that the state has consulted with local elected officials 
regarding the change. The Department may establish deadlines by which 
states are required to inform the Secretary of changes in their program 
selections.
    (d) The Secretary uses a state's process as soon as feasible, 
depending on individual programs and activities, after the Secretary is 
notified of its selections.

(Authority: E.O. 12372, sec. 2)



Sec. 79.7  How does the Secretary communicate with State and local
officials concerning the Department's programs and activities?

    (a) [Reserved]

[[Page 184]]

    (b)(1) The Secretary provides notice to directly affected state, 
areawide, regional, and local entities in a state of proposed federal 
financial assistance if:
    (i) The state has not adopted a process under the Order; or
    (ii) The assistance involves a program or activity not selected for 
the state process.
    (2) This notice may be made by publication in the Federal Register 
or other means which the Secretary determine appropriate.

(Authority: E.O. 12372, Sec. 2)



Sec. 79.8  How does the Secretary provide States an opportunity to
comment on proposed Federal financial assistance?

    (a) Except in unusual circumstances, the Secretary gives State 
processes or directly affected State, areawide, regional, and local 
officials and entities--
    (1) At least 30 days to comment on proposed Federal financial 
assistance in the form of noncompeting continuation awards; and
    (2) At least 60 days to comment on proposed Federal financial 
assistance other than noncompeting continuation awards.
    (b) The Secretary establishes a date for mailing or hand-delivering 
comments under paragraph (a) of this section using one of the following 
two procedures:
    (1) If the comments relate to continuation award applications, the 
Secretary notifies each applicant and each State Single Point of Contact 
(SPOC) of the date by which SPOC comments should be submitted.
    (2) If the comments relate to applications for new grants, the 
Secretary establishes the date in a notice published in the Federal 
Register.
    (c) This section also applies to comments in cases in which the 
review, coordination, and communication with the Department have been 
delegated.
    (d) Applicants for programs and activities subject to Section 204 of 
the Demonstration Cities and Metropolitan Act shall allow areawide 
agencies a 60-day opportunity for review and comment.

(Authority: E.O. 12372, Sec. 2)

[48 FR 29166, June 24, 1983, as amended at 51 FR 20825, June 9, 1986]



Sec. 79.9  How does the Secretary receive and respond to comments?

    (a) The Secretary follows the procedure in Sec. 79.10 if:
    (1) A state office or official is designated to act as a single 
point of contact between a state process and all federal agencies, and
    (2) That office or official transmits a State process 
recommendation, and identifies it as such, for a program selected under 
Sec. 79.6.
    (b)(1) The single point of contact is not obligated to transmit 
comments from state, areawide, regional, or local officials and entities 
if there is no state process recommendation.
    (2) If a state process recommendation is transmitted by a single 
point of contact, all comments from state, areawide, regional, and local 
officials and entities that differ from it must also be transmitted.
    (c) If a state has not established a process, or is unable to submit 
a state process recommendation, state, areawide, regional, and local 
officials and entities may submit comments to the Department.
    (d) If a program or activity is not selected for a state process, 
state, areawide, regional, and local officials and entities may submit 
comments to the Department. In addition, if a state process 
recommendation for a nonselected program or activity is transmitted to 
the Department by the single point of contact, the Secretary follows the 
procedures of Sec. 79.10.
    (e) The Secretary considers comments which do not constitute a state 
process recommendation submitted under these regulations and for which 
the Secretary is not required to apply the procedures of Sec. 79.10 of 
this part, if those comments are provided by a single point of contact, 
or directly to the Department by a commenting party.

(Authority: E.O. 12372, Sec. 2)

[48 FR 29166, June 24, 1983, as amended at 51 FR 20825, June 9, 1986]

[[Page 185]]



Sec. 79.10  How does the Secretary make efforts to accommodate 
intergovernmental concerns?

    (a) If a state process provides a state process recommendation to 
the Department through its single point of contact, the Secretary 
either:
    (1) Accepts the recommendation;
    (2) Reaches a mutually agreeable solution with the state process; or
    (3) Provides the single point of contact with a written explanation 
of the decision in such form as the Secretary deems appropriate. The 
Secretary may also supplement the written explanation by providing the 
explanation to the single point of contact by telephone, other 
telecommunication, or other means.
    (b) In any explanation under paragraph (a)(3) of this section, the 
Secretary informs the single point of contact that:
    (1) The Department will not implement its decision for at least ten 
days after the single point of contact receives the explanation; or
    (2) The Secretary has reviewed the decision and determined that, 
because of unusual circumstances, the waiting period of at least ten 
days is not feasible.
    (c) For purposes of computing the waiting period under paragraph 
(b)(1) of this section, a single point of contact is presumed to have 
received written notification 5 days after the date of mailing of the 
notification.

(Authority: E.O. 12372, Sec. 2)



Sec. 79.11  What are the Secretary's obligations in interstate
situations?

    (a) The Secretary is responsible for:
    (1) Identifying proposed federal financial assistance that has an 
impact on interstate areas;
    (2) Notifying appropriate officials and entities in states which 
have adopted a process and which select the Department's program or 
activity.
    (3) Making efforts to identify and notify the affected state, 
areawide, regional, and local officials and entities in those states 
that have not adopted a process under the Order or do not select the 
Department's program or activity;
    (4) Responding under Sec. 79.10 if the Secretary receives a 
recommendation from a designated areawide agency transmitted by a single 
point of contact, in cases in which the review, coordination, and 
communication with the Department have been delegated.
    (b) In an interstate situation subject to this section, the 
Secretary uses the procedures in Sec. 79.10 if a state process provides 
a state process recommendation to the Department through a single point 
of contact.

(Authority: E.O. 12372, Sec. 2(e))



Sec. 79.12  How may a State simplify, consolidate, or substitute
federally required State plans?

    (a) As used in this section:
    (1) Simplify means that a state may develop its own format, choose 
its own submission date, and select the planning period for a state 
plan.
    (2) Consolidate means that a state may meet statutory and regulatory 
requirements by combining two or more plans into one document and that 
the state can select the format, submission date, and planning period 
for the consolidated plan.
    (3) Substitute means that a state may use a plan or other document 
that it has developed for its own purposes to meet Federal requirements.
    (b) If not inconsistent with law, a state may decide to try to 
simplify, consolidate, or substitute federally required state plans 
without prior approval by the Secretary.
    (c) The Secretary reviews each state plan that a state has 
simplified, consolidated, or substituted and accepts the plan only if 
its contents meet federal requirements.

(Authority: E.O. 12372, sec. 2)



Sec. 79.13  [Reserved]

                           PART 80 [RESERVED]



PART 81_GENERAL EDUCATION PROVISIONS ACT_ENFORCEMENT--
Table of Contents



                      Subpart A_General Provisions

Sec.
81.1  Purpose.
81.2  Definitions.
81.3  Jurisdiction of the Office of Administrative Law Judges.
81.4  Membership and assignment to cases.

[[Page 186]]

81.5  Authority and responsibility of an Administrative Law Judge.
81.6  Hearing on the record.
81.7  Non-party participation.
81.8  Representation.
81.9  Location of proceedings.
81.10  Ex parte communications.
81.11  Motions.
81.12  Filing requirements.
81.13  Mediation.
81.14  Settlement negotiations.
81.15  Evidence.
81.16  Discovery.
81.17  Privileges.
81.18  The record.
81.19  Costs and fees of parties.
81.20  Interlocutory appeals to the Secretary from rulings of an ALJ.

                Subpart B_Hearings for Recovery of Funds

81.30  Basis for recovery of funds.
81.31  Measure of recovery.
81.32  Proportionality.
81.33  Mitigating circumstances.
81.34  Notice of a disallowance decision.
81.35  Reduction of claims.
81.36  Compromise of claims under General Education Provisions Act.
81.37  Application for review of a disallowance decision.
81.38  Consideration of an application for review.
81.39  Submission of evidence.
81.40  Burden of proof.
81.41  Initial decision.
81.42  Petition for review of initial decision.
81.43  Review by the Secretary.
81.44  Final decision of the Department.
81.45  Collection of claims.

Appendix to Part 81--Illustrations of Proportionality

    Authority: 20 U.S.C. 1221e-3, 1234-1234i, and 3474(a), unless 
otherwise noted.

    Source: 54 FR 19512, May 5, 1989, unless otherwise noted.



                      Subpart A_General Provisions



Sec. 81.1  Purpose.

    The regulations in this part govern the enforcement of legal 
requirements under applicable programs administered by the Department of 
Education and implement Part E of the General Education Provisions Act 
(GEPA).

(Authority: 20 U.S.C. 1221e-3, 1234(f)(1), and 3474(a))



Sec. 81.2  Definitions.

    The following definitions apply to the terms used in this part:
    Administrative Law Judge (ALJ) means a judge appointed by the 
Secretary in accordance with section 451 (b) and (c) of GEPA.
    Applicable program means any program for which the Secretary of 
Education has administrative responsibility, except a program authorized 
by--
    (a) The Higher Education Act of 1965, as amended;
    (b) The Act of September 30, 1950 (Pub. L. 874, 81st Congress), as 
amended; or
    (c) The Act of September 23, 1950 (Pub. L. 815, 81st Congress), as 
amended.
    Department means the United States Department of Education.
    Disallowance decision means the decision of an authorized 
Departmental official that a recipient must return funds because it made 
an expenditure of funds that was not allowable or otherwise failed to 
discharge its obligation to account properly for funds. Such a decision, 
referred to as a ``preliminary departmental decision'' in section 452 of 
GEPA, is subject to review by the Office of Administrative Law Judges.
    Party means either of the following:
    (a) A recipient that appeals a decision.
    (b) An authorized Departmental official who issues a decision that 
is appealed.
    Recipient means the recipient of a grant or cooperative agreement 
under an applicable program.
    Secretary means the Secretary of the Department of Education or an 
official or employee of the Department acting for the Secretary under a 
delegation of authority.

(Authority: 20 U.S.C. 1221e-3, 1234 (b), (c), and (f)(1), 1234a(a)(1), 
1234i, and 3474(a))

[54 FR 19512, May 5, 1989, as amended at 58 FR 43473, Aug. 16, 1993]



Sec. 81.3  Jurisdiction of the Office of Administrative Law Judges.

    (a) The Office of Administrative Law Judges (OALJ) established under 
section 451(a) of GEPA has jurisdiction to conduct the following 
proceedings concerning an applicable program:
    (1) Hearings for recovery of funds.
    (2) Withholding hearings.
    (3) Cease and desist hearings.

[[Page 187]]

    (b) The OALJ also has jurisdiction to conduct other proceedings 
designated by the Secretary. If a proceeding or class of proceedings is 
so designated, the Department publishes a notice of the designation in 
the Federal Register.

(Authority: 5 U.S.C. 554, 20 U.S.C. 1234(a))



Sec. 81.4  Membership and assignment to cases.

    (a) The Secretary appoints Administrative Law Judges as members of 
the OALJ.
    (b) The Secretary appoints one of the members of the OALJ to be the 
chief judge. The chief judge is responsible for the efficient and 
effective administration of the OALJ.
    (c) The chief judge assigns an ALJ to each case or class of cases 
within the jurisdiction of the OALJ.

(Authority: 20 U.S.C. 1221e-3, 1234 (b) and (c), and 3474(a))



Sec. 81.5  Authority and responsibility of an Administrative Law Judge.

    (a) An ALJ assigned to a case conducts a hearing on the record. The 
ALJ regulates the course of the proceedings and the conduct of the 
parties to ensure a fair, expeditious, and economical resolution of the 
case in accordance with applicable law.
    (b) An ALJ is bound by all applicable statutes and regulations and 
may neither waive them nor rule them invalid.
    (c) An ALJ is disqualified in any case in which the ALJ has a 
substantial interest, has been of counsel, is or has been a material 
witness, or is so related to or connected with any party or the party's 
attorney as to make it improper for the ALJ to be assigned to the case.
    (d)(1) An ALJ may disqualify himself or herself at any time on the 
basis of the standards in paragraph (c) of this section.
    (2) A party may file a motion to disqualify an ALJ under the 
standards in paragraph (c) of this section. A motion to disqualify must 
be accompanied by an affidavit that meets the requirements of 5 U.S.C. 
556(b). Upon the filing of such a motion and affidavit, the ALJ decides 
the disqualification matter before proceeding further with the case.

(Authority: 5 U.S.C. 556(b); 20 U.S.C. 1221e-3, 1234 (d), (f)(1) and 
(g)(1), and 3474(a))



Sec. 81.6  Hearing on the record.

    (a) A hearing on the record is a process for the orderly 
presentation of evidence and arguments by the parties.
    (b) Except as otherwise provided in this part or in a notice of 
designation under Sec. 81.3(b), an ALJ conducts the hearing entirely on 
the basis of briefs and other written submissions unless--
    (1) The ALJ determines, after reviewing all appropriate submissions, 
that an evidentiary hearing is needed to resolve a material factual 
issue in dispute; or
    (2) The ALJ determines, after reviewing all appropriate submissions, 
that oral argument is needed to clarify the issues in the case.
    (c) At a party's request, the ALJ shall confer with the parties in 
person or by conference telephone call before determining whether an 
evidentiary hearing or an oral argument is needed.

(Authority: 5 U.S.C. 556(d); 20 U.S.C. 1221e-3, 1234(f)(1), and 3474)



Sec. 81.7  Non-party participation.

    (a) A person or organization, other than a party, that wishes to 
participate in a case shall file an application to participate with the 
ALJ assigned to the case. The application must--
    (1) Identify the case in which participation is sought;
    (2) State how the applicant's interest relates to the case;
    (3) State how the applicant's participation would aid in the 
disposition of the case; and
    (4) State how the applicant seeks to participate.
    (b) The ALJ may permit an applicant to participate if the ALJ 
determines that the applicant's participation--
    (1) Will aid in the disposition of the case;
    (2) Will not unduly delay the proceedings; and
    (3) Will not prejudice the adjudication of the parties' rights.
    (c) If the ALJ permits an applicant to participate, the ALJ permits 
the applicant to file briefs.

[[Page 188]]

    (d)(1) In addition to the participation described in paragraph (c) 
of this section, the ALJ may permit the applicant to participate in any 
or all of the following ways:
    (i) Submit documentary evidence.
    (ii) Participate in an evidentiary hearing afforded the parties.
    (iii) Participate in an oral argument afforded the parties.
    (2) The ALJ may place appropriate limits on an applicant's 
participation to ensure the efficient conduct of the proceedings.
    (e) A non-party participant shall comply with the requirements for 
parties in Sec. 81.11 and Sec. 81.12.

(Authority: 20 U.S.C. 1221e-3, 1234(f)(1), and 3474(a))



Sec. 81.8  Representation.

    A party to, or other participant in, a case may be represented by 
counsel.

(Authority: 20 U.S.C. 1221e-3, 1234(f)(1), and 3474(a))



Sec. 81.9  Location of proceedings.

    (a) An ALJ may hold conferences of the parties in person or by 
conference telephone call.
    (b) Any conference, hearing, argument, or other proceeding at which 
the parties are required to appear in person is held in the Washington, 
DC metropolitan area unless the ALJ determines that the convenience and 
necessity of the parties or their representatives requires that it be 
held elsewhere.

(Authority: 5 U.S.C. 554(b); 20 U.S.C. 1221e-3, 1234(f)(1), and 3474(a))



Sec. 81.10  Ex parte communications.

    A party to, or other participant in, a case may not communicate with 
an ALJ on any fact in issue in the case or on any matter relevant to the 
merits of the case unless the parties are given notice and an 
opportunity to participate.

(Authority: 5 U.S.C. 554(d)(1), 557(d)(1)(A); 20 U.S.C. 1221e-3, 
1234(f)(1), and 3474(a))



Sec. 81.11  Motions.

    (a) To obtain an order or a ruling from an ALJ, a party shall make a 
motion to the ALJ.
    (b) Except for a request for an extension of time, a motion must be 
made in writing unless the parties appear in person or participate in a 
conference telephone call. The ALJ may require a party to reduce an oral 
motion to writing.
    (c) If a party files a motion, the party shall serve a copy of the 
motion on the other party on the filing date by hand-delivery or by 
mail. If agreed upon by the parties, service of the motion may be made 
upon the other party by facsimile transmission.
    (d) Except for a request for an extension of time, the ALJ may not 
grant a party's written motion without the consent of the other party 
unless the other party has had at least 21 days from the date of service 
of the motion to respond. However, the ALJ may deny a motion without 
awaiting a response.
    (e) The date of service of a motion is determined by the standards 
for determining a filing date in Sec. 81.12(d).

(Authority: 20 U.S.C. 1221e-3, 1234(f)(1), and 3474(a))

[54 FR 19512, May 5, 1989, as amended at 57 FR 56795, Nov. 30, 1992]



Sec. 81.12  Filing requirements.

    (a) Any written submission to an ALJ or the OALJ under this part 
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) If a party files a brief or other document with an ALJ or the 
OALJ, the party shall serve a copy of the filed material on the other 
party on the filing date by hand-delivery or by mail. If agreed upon by 
the parties, service of a document may be made upon the other party by 
facsimile transmission.
    (c) Any written submission to an ALJ or the OALJ must be accompanied 
by a statement certifying the date that the filed material was filed and 
served on the other party.
    (d)(1) The filing date for a written submission to an ALJ or the 
OALJ is the date the document is--
    (i) Hand-delivered;
    (ii) Mailed; or
    (iii) Sent by facsimile transmission.

[[Page 189]]

    (2) If a scheduled filing date falls on a Saturday, Sunday, or 
Federal holiday, the filing deadline is the next business day.
    (e) A party filing by facsimile transmission is responsible for 
confirming that a complete and legible copy of the document was received 
by the Department.
    (f) If a document is filed by facsimile transmission, a follow-up 
hard copy must be filed by hand-delivery or by mail within a reasonable 
period of time.

(Authority: 20 U.S.C. 1221e-3, 1234(f)(1), and 3474(a))

[54 FR 19512, May 5, 1989, as amended at 57 FR 56795, Nov. 30, 1992]



Sec. 81.13  Mediation.

    (a) Voluntary mediation is available for proceedings that are 
pending before the OALJ.
    (b) A mediator must be independent of, and agreed to by, the parties 
to the case.
    (c) A party may request mediation by filing a motion with the ALJ 
assigned to the case. The OALJ arranges for a mediator if the parties to 
the case agree to mediation.
    (d) A party may terminate mediation at any time. Mediation is 
limited to 120 days unless the mediator informs the ALJ that--
    (1) The parties are likely to resolve some or all of the dispute; 
and
    (2) An extension of time will facilitate an agreement.
    (e) The ALJ stays the proceedings during mediation.
    (f)(1) Evidence of conduct or statements made during mediation is 
not admissible in any proceeding under this part. However, evidence that 
is otherwise discoverable may not be excluded merely because it was 
presented during mediation.
    (2) A mediator may not disclose, in any proceeding under this part, 
information acquired as a part of his or her official mediation duties 
that relates to any fact in issue in the case or any matter relevant to 
the merits of the case.

(Authority: 20 U.S.C. 1221e-3, 1234 (f)(1) and (h), and 3474(a))



Sec. 81.14  Settlement negotiations.

    (a) If the parties to a case file a joint motion requesting a stay 
of the proceedings for settlement negotiations, or for approval of a 
settlement agreement, the ALJ may grant a stay of the proceedings upon a 
finding of good cause.
    (b) Evidence of conduct or statements made during settlement 
negotiations is not admissible in any proceeding under this part. 
However, evidence that is otherwise discoverable may not be excluded 
merely because it was presented during settlement negotiations.
    (c) The parties may not disclose the contents of settlement 
negotiations to the ALJ. If the parties enter into a settlement 
agreement and file a joint motion to dismiss the case, the ALJ grants 
the motion.

(Authority: 20 U.S.C. 554(c)(1), 1221e-3, 1234(f)(1), and 3474(a))

[54 FR 19512, May 5, 1989, as amended at 58 FR 43473, Aug. 16, 1993]



Sec. 81.15  Evidence.

    (a) The Federal Rules of Evidence do not apply to proceedings under 
this part. However, the ALJ accepts only evidence that is--
    (1) Relevant;
    (2) Material;
    (3) Not unduly repetitious; and
    (4) Not inadmissible under Sec. 81.13 or Sec. 81.14.
    (b) The ALJ may take official notice of facts that are generally 
known or capable of accurate and ready determination by resort to 
sources whose accuracy cannot reasonably be questioned.

(Authority: 5 U.S.C. 556 (d) and (e); 20 U.S.C. 1221e-3, 1234(f)(1), and 
3474(a))



Sec. 81.16  Discovery.

    (a) The parties to a case are encouraged to exchange relevant 
documents and information voluntarily.
    (b) The ALJ, at a party's request, may order compulsory discovery 
described in paragraph (c) of this section if the ALJ determines that--
    (1) The order is necessary to secure a fair, expeditious, and 
economical resolution of the case;

[[Page 190]]

    (2) The discovery requested is likely to elicit relevant information 
with respect to an issue in the case;
    (3) The discovery request was not made primarily for the purposes of 
delay or harassment; and
    (4) The order would serve the ends of justice.
    (c) If a compulsory discovery is permissible under paragraph (b) of 
this section, the ALJ may order a party to do one or more of the 
following:
    (1) Make relevant documents available for inspection and copying by 
the party making the request.
    (2) Answer written interrogatories that inquire into relevant 
matters.
    (3) Have depositions taken.
    (d) The ALJ may issue a subpoena to enforce an order described in 
this section and may apply to the appropriate court of the United States 
to enforce the subpoena.
    (e) The ALJ may not compel the discovery of information that is 
legally privileged.
    (f)(1) The ALJ limits the period for discovery to not more than 90 
days but may grant an extension for good cause.
    (2) At a party's request, the ALJ may set a specific schedule for 
discovery.

(Authority: 20 U.S.C. 1234(f)(1) and (g))



Sec. 81.17  Privileges.

    The privilege of a person or governmental organization not to 
produce documents or provide information in a proceeding under this part 
is governed by the principles of common law as interpreted by the courts 
of the United States.

(Authority: 20 U.S.C. 1221e-3, 1234(f)(1), and 3474(a))



Sec. 81.18  The record.

    (a) The ALJ arranges for any evidentiary hearing or oral argument to 
be recorded and transcribed and makes the transcript available to the 
parties. Transcripts are made available to non-Departmental parties at a 
cost not to exceed the actual cost of duplication.
    (b) The record of a hearing on the record consists of--
    (1) All papers filed in the proceeding;
    (2) Documentary evidence admitted by the ALJ;
    (3) The transcript of any evidentiary hearing or oral argument; and
    (4) Rulings, orders, and subpoenas issued by the ALJ.

(Authority: 5 U.S.C. 556(e), 557(c); 20 U.S.C. 1221e-3(a)(1), 
1234(f)(1), 3474(a))

[54 FR 19512, May 5, 1989, as amended at 58 FR 43473, Aug. 16, 1993]



Sec. 81.19  Costs and fees of parties.

    The Equal Access to Justice Act, 5 U.S.C. 504, applies by its terms 
to proceedings under this part. Regulations under that statute are in 34 
CFR part 21.

(Authority: 20 U.S.C. 1221e-3, 1234(f)(1), and 3474(a))



Sec. 81.20  Interlocutory appeals to the Secretary from rulings of 
an ALJ.

    (a) A ruling by an ALJ may not be appealed to the Secretary until 
the issuance of an initial decision, except that the Secretary may, at 
any time prior to the issuance of an initial decision, grant review of a 
ruling upon either an ALJ's certification of the ruling to the Secretary 
for review, or the filing of a petition seeking review of an interim 
ruling by one or both of the parties, if--
    (1) That ruling involves a controlling question of substantive or 
procedural law; and
    (2) The immediate resolution of the question will materially advance 
the final disposition of the proceeding or subsequent review will be an 
inadequate remedy.
    (b)(1) A petition for interlocutory review of an interim ruling must 
include the following:
    (i) A brief statement of the facts necessary to an understanding of 
the issue on which review is sought.
    (ii) A statement of the issue.
    (iii) A statement of the reasons showing that the ruling complained 
of involves a controlling question of substantive or procedural law and 
why immediate review of the ruling will materially advance the 
disposition of the case, or why subsequent review will be an inadequate 
remedy.
    (2) A petition may not exceed ten pages, double-spaced, and must be 
accompanied by a copy of the ruling and any findings and opinions 
relating to

[[Page 191]]

the ruling. The petition must be filed with the Office of Hearings and 
Appeals, which immediately forwards the petition to the Office of the 
Secretary.
    (c) A copy of the petition must be provided to the ALJ at the time 
the petition is filed under paragraph (b)(2) of this section, and a copy 
of a petition or any certification must be served upon the parties by 
certified mail, return receipt requested. The petition or certification 
must reflect that service.
    (d) If a party files a petition under this section, the ALJ may 
state to the Secretary a view as to whether review is appropriate or 
inappropriate by submitting a brief statement addressing the party's 
petition within 10 days of the ALJ's receipt of the petition for 
interlocutory review. A copy of the statement must be served on all 
parties by certified mail, return receipt requested.
    (e)(1) A party's response, if any, to a petition or certification 
for interlocutory review must be filed within seven days after service 
of the petition or certification, and may not exceed ten pages, double-
spaced, in length. A copy of the response must be filed with the ALJ by 
hand delivery, by regular mail, or by facsimile transmission.
    (2) A party shall serve a copy of its response on all parties on the 
filing date by hand-delivery or regular mail. If agreed upon by the 
parties, service of a copy of the response may be made upon the other 
parties by facsimile transmission.
    (f) The filing of a request for interlocutory review does not 
automatically stay the proceedings. Rather, a stay during consideration 
of a petition for review may be granted by the ALJ if the ALJ has 
certified or stated to the Secretary that review of the ruling is 
appropriate. The Secretary may order a stay of proceedings at any time 
after the filing of a request for interlocutory review.
    (g) The Secretary notifies the parties if a petition or 
certification for interlocutory review is accepted, and may provide the 
parties a reasonable time within which to submit written argument or 
other existing material in the administrative record with regard to the 
merit of the petition or certification.
    (h) If the Secretary takes no action on a request for interlocutory 
review within 15 days of receipt of it, the request is deemed to be 
denied.
    (i) The Secretary may affirm, modify, set aside, or remand the ALJ's 
ruling.

(Authority: 5 U.S.C. 557(b); 20 U.S.C. 1234(f)(1))

[58 FR 43473, Aug. 16, 1993]



                Subpart B_Hearings for Recovery of Funds



Sec. 81.30  Basis for recovery of funds.

    (a) Subject to the provisions of Sec. 81.31, an authorized 
Departmental official requires a recipient to return funds to the 
Department if--
    (1) The recipient made an unallowable expenditure of funds under a 
grant or cooperative agreement; or
    (2) The recipient otherwise failed to discharge its obligation to 
account properly for funds under a grant or cooperative agreement.
    (b) An authorized Departmental offcial may base a decision to 
require a recipient to return funds upon an audit report, an 
investigative report, a monitoring report, or any other evidence.

(Authority: 20 U.S.C. 1234a(a) (1) and (2))

[54 FR 19512, May 5, 1989. Redesignated and amended at 58 FR 43473, Aug. 
16, 1993]



Sec. 81.31  Measure of recovery.

    A recipient that made an unallowable expenditure or otherwise failed 
to discharge its obligation to account properly for funds shall return 
an amount that--
    (a) Meets the standards for proportionality in Sec. 81.32;
    (b) In the case of a State or local educational agency, excludes any 
amount attributable to mitigating circumstances under the standards in 
Sec. 81.23; and
    (c) Excludes any amount expended in a manner not authorized by law 
more

[[Page 192]]

than five years before the recipient received the notice of a 
disallowance decision under Sec. 81.34.

(Authority: 20 U.S.C. 1221e-3, 1234(f)(1), 1234a(k), 1234b (a) and (b), 
and 3474(a))

[54 FR 19512, May 5, 1989; 54 FR 21622, May 19, 1989. Redesignated and 
amended at 58 FR 43473, Aug. 16, 1993]



Sec. 81.32  Proportionality.

    (a)(1) A recipient that made an unallowable expenditure or otherwise 
failed to account properly for funds shall return an amount that is 
proportional to the extent of the harm its violation caused to an 
identifiable Federal interest associated with the program under which it 
received the grant or cooperative agreement.
    (2) An identifiable Federal interest under paragraph (a)(1) of this 
section includes, but is not limited to, the following:
    (i) Serving only eligible beneficiaries.
    (ii) Providing only authorized services or benefits.
    (iii) Complying with expenditure requirements and conditions, such 
as set-aside, excess cost, maintenance of effort, comparability, 
supplement-not-supplant, and matching requirements.
    (iv) Preserving the integrity of planning, application, 
recordkeeping, and reporting requirements.
    (v) Maintaining accountability for the use of funds.
    (b) The appendix to this part contains examples that illustrate how 
the standards for proportionality apply. The examples present 
hypothetical cases and do not represent interpretations of any actual 
program statute or regulation.

(Authority: 20 U.S.C. 1221e-3, 1234(f)(1), 1234b(a), and 3474(a))

[54 FR 19512, May 5, 1989. Redesignated at 58 FR 43473, Aug. 16, 1993]



Sec. 81.33  Mitigating circumstances.

    (a) A recipient that is a State or local educational agency and that 
has made an unallowable expenditure or otherwise failed to account 
properly for funds is not required to return any amount that is 
attributable to the mitigating circumstances described in paragraph (b), 
(c), or (d) of this section.
    (b) Mitigating circumstances exist if it would be unjust to compel 
the recovery of funds because the recipient's violation was caused by 
erroneous written guidance from the department. To prove mitigating 
circumstances under this paragraph, the recipient shall prove that--
    (1) The guidance was provided in response to a specific written 
request from the recipient that was submitted to the Department at the 
address provided by notice published in the Federal Register under this 
section;
    (2) The guidance was provided by a Departmental official authorized 
to provide the guidance, as described by that notice;
    (3) The recipient actually relied on the guidance as the basis for 
the conduct that constituted the violation; and
    (4) The recipient's reliance on the guidance was reasonable.
    (c) Mitigating circumstances exist if it would be unjust to compel 
the recovery of funds because the recipient's violation was caused by 
the Department's failure to provide timely guidance. To prove mitigating 
circumstances under this paragraph, the recipient shall prove that--
    (1) The recipient in good faith submitted a written request for 
guidance with respect to the legality of a proposed expenditure or 
practice;
    (2) The request was submitted to the Department at the address 
provided by notice published in the Federal Register under this section;
    (3) The request--
    (i) Accurately described the proposed expenditure or practice; and
    (ii) Included the facts necessary for the Department's determination 
of its legality;
    (4) The request contained the certification of the chief legal 
officer of the appropriate State educational agency that the officer--
    (i) Examined the proposed expenditure or practice; and
    (ii) Believed it was permissible under State and Federal law 
applicable at the time of the certification;
    (5) The recipient reasonably believed the proposed expenditure or 
practice

[[Page 193]]

was permissible under State and Federal law applicable at the time it 
submitted the request to the Department;
    (6) No Departmental official authorized to provide the requested 
guidance responded to the request within 90 days of its receipt by the 
Department; and
    (7) The recipient made the proposed expenditure or engaged in the 
proposed practice after the expiration of the 90-day period.
    (d) Mitigating circumstances exist if it would be unjust to compel 
the recovery of funds because the recipient's violation was caused by 
the recipient's compliance with a judicial decree from a court of 
competent jurisdiction. To prove mitigating circumstances under this 
paragraph, the recipient shall prove that--
    (1) The recipient was legally bound by the decree;
    (2) The recipient actually relied on the decree when it engaged in 
the conduct that constituted the violation; and
    (3) The recipient's reliance on the decree was reasonable.
    (e) If a Departmental official authorized to provide the requested 
guidance responds to a request described in paragraph (c) of this 
section more than 90 days after its receipt, the recipient that made the 
request shall comply with the guidance at the earliest practicable time.

(Authority: 20 U.S.C. 1221e-3, 1234(f)(1), 1234b(b), and 3474(a))

[54 FR 19512, May 5, 1989. Redesignated at 58 FR 43473, Aug. 16, 1993]



Sec. 81.34  Notice of a disallowance decision.

    (a) If an authorized Departmental official decides that a recipient 
must return funds under Sec. 81.30, the official gives the recipient 
written notice of a disallowance decision. The official sends the notice 
by certified mail, return receipt requested, or other means that ensure 
proof of receipt.
    (b)(1) The notice must establish a prima facie case for the recovery 
of funds, including an analysis reflecting the value of the program 
services actually obtained in a determination of harm to the Federal 
interest.
    (2) For the purpose of this section, a prima facie case is a 
statement of the law and the facts that, unless rebutted, is sufficient 
to sustain the conclusion drawn in the notice. The facts may be set out 
in the notice or in a document that is identified in the notice and 
available to the recipient.
    (3) A statement that the recipient failed to maintain records 
required by law or failed to allow an authorized representative of the 
Secretary access to those records constitutes a prima facie case for the 
recovery of the funds affected.
    (i) If the recipient failed to maintain records, the statement must 
briefly describe the types of records that were not maintained and 
identify the recordkeeping requirement that was violated.
    (ii) If the recipient failed to allow access to records, the 
statement must briefly describe the recipient's actions that constituted 
the failure and identify the access requirement that was violated.
    (c) The notice must inform the recipient that it may--
    (1) Obtain a review of the disallowance decision by the OALJ; and
    (2) Request mediation under Sec. 81.13.
    (d) The notice must describe--
    (1) The time available to apply for a review of the disallowance 
decision; and
    (2) The procedure for filing an application for review.

(Authority: 20 U.S.C. 1221e-3, 1234(f)(1), 1234a(a), and 3474(a))

[54 FR 19512, May 5, 1989. Redesignated and amended at 58 FR 43473, Aug. 
16, 1993; 60 FR 46494, Sept. 6, 1995; 61 FR 14484, Apr. 2, 1996]



Sec. 81.35  Reduction of claims.

    The Secretary or an authorized Departmental official as appropriate 
may, after the issuance of a disallowance decision, reduce the amount of 
a claim established under this subpart by--
    (a) Redetermining the claim on the basis of the proper application 
of the law, including the standards for the measure of recovery under 
Sec. 81.31, to the facts;
    (b) Compromising the claim under the Federal Claims Collection 
Standards in 4 CFR part 103; or

[[Page 194]]

    (c) Compromising the claim under Sec. 81.36, if applicable.

(Authority: 20 U.S.C. 1221e-3, 1234(f)(1), 1234a(j), and 3474(a); 31 
U.S.C. 3711)

[54 FR 19512, May 5, 1989. Redesignated and amended at 58 FR 43473, Aug. 
16, 1993]



Sec. 81.36  Compromise of claims under General Education Provisions
Act.

    (a) The Secretary or an authorized Departmental official as 
appropriate may compromise a claim established under this subpart 
without following the procedures in 4 CFR part 103 if--
    (1)(i) The amount of the claim does not exceed $200,000; or
    (ii) The difference between the amount of the claim and the amount 
agreed to be returned does not exceed $200,000; and
    (2) The Secretary or the official determines that--
    (i) The collection of the amount by which the claim is reduced under 
the compromise would not be practical or in the public interest; and
    (ii) The practice that resulted in the disallowance decision has 
been corrected and will not recur.
    (b) Not less than 45 days before compromising a claim under this 
section, the Department publishes a notice in the Federal Register 
stating--
    (1) The intention to compromise the claim; and
    (2) That interested persons may comment on the proposed compromise.

(Authority: 20 U.S.C. 1221e-3, 1234(f)(1), 1234a (j), and 3474(a))

[54 FR 19512, May 5, 1989. Redesignated at 58 FR 43473, Aug. 16, 1993]



Sec. 81.37  Application for review of a disallowance decision.

    (a) If a recipient wishes to obtain review of a disallowance 
decision, the recipient shall file a written application for review with 
the Office of Administrative Law Judges, c/o Docket Clerk, Office of 
Hearings and Appeals, and, as required by Sec. 81.12(b), shall serve a 
copy on the applicable Departmental official who made the disallowance 
decision.
    (b) A recipient shall file an application for review not later than 
60 days after the date it receives the notice of a disallowance 
decision.
    (c) Within 10 days after receipt of a copy of the application for 
review, the authorized Departmental official who made the disallowance 
decision shall provide the ALJ with a copy of any document identified in 
the notice pursuant to Sec. 81.34(b)(2).
    (d) An application for review must contain--
    (1) A copy of the disallowance decision of which review is sought;
    (2) A statement certifying the date the recipient received the 
notice of that decision;
    (3) A short and plain statement of the disputed issues of law and 
fact, the recipient's position with respect to these issues, and the 
disallowed funds the recipient contends need not be returned; and
    (4) A statement of the facts and the reasons that support the 
recipient's position.
    (e) The ALJ who considers a timely application for review that 
substantially complies with the requirements of paragraph (c) of this 
section may permit the recipient to supplement or amend the application 
with respect to issues that were timely raised. Any requirement to 
return funds that is not timely appealed becomes the final decision of 
the Department.

(Authority: 20 U.S.C. 1221e-3, 1234(f)(1), 1234a(b)(1), and 3474(a))

[54 FR 19512, May 5, 1989. Redesignated and amended at 58 FR 43473, 
43474, Aug. 16, 1993; 58 FR 51013, Sept. 30, 1993; 60 FR 46494, Sept. 6, 
1995]



Sec. 81.38  Consideration of an application for review.

    (a) The ALJ assigned to the case under Sec. 81.4 considers an 
application for review of a disallowance decision.
    (b) The ALJ decides whether the notice of a disallowance decision 
meets the requirements of Sec. 81.34, as provided by section 451(e) of 
GEPA.
    (1) If the notice does not meet those requirements, the ALJ--
    (i) Returns the notice, as expeditiously as possible, to the 
authorized Departmental official who made the disallowance decision;
    (ii) Gives the official the reasons why the notice does not meet the 
requirements of Sec. 81.34; and

[[Page 195]]

    (iii) Informs the recipient of the ALJ's decision by certified mail, 
return receipt requested.
    (2) An authorized Departmental official may modify and reissue a 
notice that an ALJ returns.
    (c) If the notice of a disallowance decision meets the requirements 
of Sec. 81.34, the ALJ decides whether the application for review meets 
the requirements of Sec. 81.37.
    (1) If the application, including any supplements or amendments 
under Sec. 81.37(d), does not meet those requirements, the disallowance 
decision becomes the final decision of the Department.
    (2) If the application meets those requirements, the ALJ--
    (i) Informs the recipient and the authorized Departmental official 
that the OALJ has accepted jurisdiction of the case; and
    (ii) Schedules a hearing on the record.
    (3) The ALJ informs the recipient of the disposition of its 
application for review by certified mail, return receipt requested. If 
the ALJ decides that the application does not meet the requirements of 
Sec. 81.37, the ALJ informs the recipient of the reasons for the 
decision.

(Authority: 20 U.S.C. 1221e-3, 1234 (e) and (f)(1), 1234a(b), and 
3474(a))

[54 FR 19512, May 5, 1989. Redesignated and amended at 58 FR 43473, Aug. 
16, 1993]



Sec. 81.39  Submission of evidence.

    (a) The ALJ schedules the submission of the evidence, whether oral 
or documentary, to occur within 90 days of the OALJ's receipt of an 
acceptable application for review under Sec. 81.37.
    (b) The ALJ may waive the 90-day requirement for good cause.

(Authority: 5 U.S.C. 556(d); 20 U.S.C. 1221e-3, 1234(f)(1), 1234a(c), 
and 3474(a))

[54 FR 19512, May 5, 1989. Redesignated and amended at 58 FR 43473, Aug. 
16, 1993]



Sec. 81.40  Burden of proof.

    If the OALJ accepts jurisdiction of a case under Sec. 81.38, the 
recipient shall present its case first and shall have the burden of 
proving that the recipient is not required to return the amount of funds 
that the disallowance decision requires to be returned because--
    (a) An expenditure identified in the disallowance decision as 
unallowable was allowable;
    (b) The recipient discharged its obligation to account properly for 
the funds;
    (c) The amount required to be returned does not meet the standards 
for proportionality in Sec. 81.32;
    (d) The amount required to be returned includes an amount 
attributable to mitigating circumstances under the standards in 
Sec. 81.33; or
    (e) The amount required to be returned includes an amount expended 
in a manner not authorized by law more than five years before the 
recipient received the notice of the disallowance decision.

(Authority: 20 U.S.C. 1221e-3, 1234(f)(1), 1234a(b)(3), 1234b(b)(1), and 
3474(a))

[54 FR 19512, May 5, 1989. Redesignated and amended at 58 FR 43473, Aug. 
16, 1993]



Sec. 81.41  Initial decision.

    (a) The ALJ makes an initial decision based on the record.
    (b) The initial decision includes the ALJ's findings of fact, 
conclusions of law, and reasoning on all material issues.
    (c) The initial decision is transmitted to the Secretary by hand-
delivery or Department mail, and to the parties by certified mail, 
return receipt requested, by the Office of Administrative Law Judges.
    (d) For the purpose of this part, ``initial decision'' includes an 
ALJ's modified decision after the Secretary's remand of a case.

(Authority: 5 U.S.C. 557(c); 20 U.S.C 1221e-3, 1234(f)(1), and 3474(a))

[54 FR 19512, May 5, 1989. Redesignated and amended at 58 FR 43473, 
43474, Aug. 16, 1993]



Sec. 81.42  Petition for review of initial decision.

    (a) If a party seeks to obtain the Secretary's review of the initial 
decision of an ALJ, the party shall file a petition for review with the 
Office of Hearings and Appeals, which immediately forwards the petition 
to the Office of the Secretary.

[[Page 196]]

    (b) A party shall file a petition for review not later than 30 days 
after the date it receives the initial decision.
    (c) If a party files a petition for review, the party shall serve a 
copy of the petition on the other party on the filing date by hand 
delivery or by ``overnight or express'' mail. If agreed upon by the 
parties, service of a copy of the petition may be made upon the other 
party by facsimile transmission.
    (d) Any written submission to the Secretary under this section must 
be accompanied by a statement certifying the date that the filed 
material was served on the other party.
    (e) A petition for review of an initial decision must contain--
    (1) The identity of the initial decision for which review is sought; 
and
    (2) A statement of the reasons asserted by the party for affirming, 
modifying, setting aside, or remanding the initial decision in whole or 
in part.
    (f)(1) A party may respond to a petition for review of an initial 
decision by filing a statement of its views on the issues raised in the 
petition with the Secretary, as provided for in this section, not later 
than 15 days after the date it receives the petition.
    (2) A party shall serve a copy of its statement of views on the 
other party by hand delivery or mail, and shall certify that it has done 
so pursuant to the provisions of paragraph (d) of this section. If 
agreed upon by the parties, service of a copy of the statement of views 
may be made upon the other party by facsimile transmission.
    (g)(1) The filing date for written submissions under this section is 
the date the document is--
    (i) Hand delivered;
    (ii) Mailed; or
    (iii) Sent by facsimile transmission.
    (2) If a scheduled filing date falls on a Saturday, Sunday or a 
Federal holiday, the filing deadline is the next business day.

(Authority: 20 U.S.C. 1221e-3, 1234(f)(1), 1234a(e), and 3474(a))

[58 FR 43474, Aug. 16, 1993]



Sec. 81.43  Review by the Secretary.

    (a)(1) The Secretary's review of an initial decision is based on the 
record of the case, the initial decision, and any proper submissions of 
the parties or other participants in the case.
    (2) During the Secretary's review of the initial decision there 
shall not be any ex parte contact between the Secretary and individuals 
representing the Department or the recipient.
    (b) The ALJ's findings of fact, if supported by substantial 
evidence, are conclusive.
    (c) The Secretary may affirm, modify, set aside, or remand the ALJ's 
initial decision.
    (1) If the Secretary modifies, sets aside, or remands an initial 
decision, in whole or in part, the Secretary's decision includes a 
statement of reasons that supports the Secretary's decision.
    (2)(i) The Secretary may remand the case to the ALJ with 
instructions to make additional findings of fact or conclusions of law, 
or both, based on the evidence of record. The Secretary may also remand 
the case to the ALJ for further briefing or for clarification or 
revision of the initial decision.
    (ii) If a case is remanded, the ALJ shall make new or modified 
findings of fact or conclusions of law or otherwise modify the initial 
decision in accordance with the Secretary's remand order.
    (iii) A party may appeal a modified decision of the ALJ under the 
provisions of Secs. 81.42 through 81.45. However, upon that review, the 
ALJ's new or modified findings, if supported by substantial evidence, 
are conclusive.
    (3) The Secretary, for good cause shown, may remand the case to the 
ALJ to take further evidence, and the ALJ may make new or modified 
findings of fact and may modify the initial decision based on that new 
evidence. These new or modified findings of fact are likewise conclusive 
if supported by substantial evidence.

(Authority: 5 U.S.C. 557(b); 20 U.S.C. 1221e-3, 1234(f)(1), 1234a(d), 
and 3474(a))

[58 FR 43474, Aug. 16, 1993, as amended at 60 FR 46494, Sept. 6, 1995]



Sec. 81.44  Final decision of the Department.

    (a) The ALJ's initial decision becomes the final decision of the 
Department 60 days after the recipient receives the ALJ's decision 
unless the

[[Page 197]]

Secretary modifies, sets aside, or remands the decision during the 60-
day period.
    (b) If the Secretary modifies or sets aside the ALJ's initial 
decision, a copy of the Secretary's decision is sent by the Office of 
Hearings and Appeals to the parties by certified mail, return receipt 
requested. The Secretary's decision becomes the final decision of the 
Department on the date the recipient receives the Secretary's decision.

(Authority: 20 U.S.C. 1221e-3, 1234(f)(1), 1234a(g), and 3474(a))

[54 FR 19512, May 5, 1989. Redesignated and amended at 58 FR 43473, 
43474, Aug. 16, 1993]



Sec. 81.45  Collection of claims.

    (a) An authorized Departmental official collects a claim established 
under this subpart by using the standards and procedures in 34 CFR part 
30.
    (b) A claim established under this subpart may be collected--
    (1) 30 days after a recipient receives notice of a disallowance 
decision if the recipient fails to file an acceptable application for 
review under Sec. 81.37; or
    (2) On the date of the final decision of the Department under 
Sec. 81.44 if the recipient obtains review of a disallowance decision.
    (c) The Department takes no collection action pending judicial 
review of a final decision of the Department under section 458 of GEPA.
    (d) If a recipient obtains review of a disallowance decision under 
Sec. 81.38, the Department does not collect interest on the claim for 
the period between the date of the disallowance decision and the date of 
the final decision of the Department under Sec. 81.44.

(Authority: 20 U.S.C. 1234(f)(1); 1234a(f)(1) and (2), (i), and (1))

[54 FR 19512, May 5, 1989. Redesignated and amended at 58 FR 43473, Aug. 
16, 1993]



       Sec. Appendix to Part 81--Illustrations of Proportionality

    (1) Ineligible beneficiaries. A State uses 15 percent of its grant 
to meet the special educational needs of children who were migratory, 
but who have not migrated for more than five years as a Federal program 
statute requires for eligibility to participate in the program. Result: 
Recovery of 15 percent of the grant--all program funds spent for the 
benefit of those children. Although the services were authorized, the 
children were not eligible to receive them.
    (2) Ineligible beneficiaries. A Federal program designed to meet the 
special educational needs of gifted and talented children requires that 
at least 80 percent of the children served in any project must be 
identified as gifted or talented. A local educational agency (LEA) 
conducts a project in which 76 students are identified as gifted or 
talented and 24 are not. The project was designed and implemented to 
meet the special educational needs of gifted and talented students. 
Result: The LEA must return five percent of the project costs. The LEA 
provided authorized services for a project in which the 76 target 
students had to constitute at least 80 percent of the total. Thus, the 
maximum number of non-target students permitted was 19. Project costs 
relating to the remaining five students must be returned.
    (3) Ineligible beneficiaries. Same as the example in paragraph (2), 
except that only 15 percent of the children were identified as gifted or 
talented. On the basis of the low percentage of these children and other 
evidence, the authorized Departmental official finds that the project as 
a whole did not address their special educational needs and was outside 
the purpose of the statute. Result: The LEA must return its entire 
award. The difference between the required percentage of gifted and 
talented children and the percentage actually enrolled is so substantial 
that, if consistent with other evidence, the official may reasonably 
conclude the entire grant was misused.
    (4) Ineligible beneficiaries. Same as the example in paragraph (2), 
except that 60 percent of the children were identified as gifted or 
talented, and it is not clear whether the project was designed or 
implemented to meet the special educational needs of these children. 
Result: If it is determined that the project was designed and 
implemented to serve their special educational needs, the LEA must 
return 25 percent of the project costs. A project that included 60 
target children would meet the requirement that 80 percent of the 
children served be gifted and talented if it included no more than 15 
other children. Thus, while the LEA provided authorized services, only 
75 percent of the beneficiaries were authorized to participate in the 
project (60 target children and 15 others). If the authorized 
Departmental official, after examining all the relevant facts, 
determines that the project was not designed and implemented to serve 
the special educational needs of gifted or talented students, the LEA 
must return its entire award because it did not provide services 
authorized by the statute.
    (5) Unauthorized activities. An LEA uses ten percent of its grant 
under a Federal program that authorizes activities only to meet the 
special educational needs of educationally

[[Page 198]]

deprived children to pay for health services that are available to all 
children in the LEA. All the children who use the Federally funded 
health services happen to be educationally deprived, and thus eligible 
to receive program services. Result: Recovery of ten percent of the 
grant--all program funds spent for the health services. Although the 
children were eligible to receive program services, the health services 
were unrelated to a special educational need and, therefore, not 
authorized by law.
    (6) Set-aside requirement. A State uses 22 percent of its grant for 
one fiscal year under a Federal adult education program to provide 
programs of equivalency to a certificate of graduation from a secondary 
school. The adult education program statute restricts those programs to 
no more than 20 percent of the State's grant. Result: Two percent of the 
State's grant must be returned. Although all 22 percent of the funds 
supported adult education, the State had no authority to spend more than 
20 percent on secondary school equivalency programs.
    (7) Set-aside requirement. A State uses eight percent of its basic 
State grant under a Federal vocational education program to pay for the 
excess cost of vocational education services and activities for 
handicapped individuals. The program statute requires a State to use ten 
percent of its basic State grant for this purpose. Result: The State 
must return two percent of its basic State grant, regardless of how it 
was used. Because the State was required to spend that two percent on 
services and activities for handicapped individuals and did not do so, 
it diverted those funds from their intended purposes, and the Federal 
interest was harmed to that extent.
    (8) Excess cost requirement. An LEA uses funds reserved for the 
disadvantaged under a Federal vocational education program to pay for 
the cost of the same vocational education services it provides to non-
disadvantaged individuals. The program statute requires that funds 
reserved for the disadvantaged must be used to pay only for the 
supplemental or additional costs of vocational education services that 
are not provided to other individuals and that are required for 
disadvantaged individuals to participate in vocational education. 
Result: All the funds spent on the disadvantaged must be returned. 
Although the funds were spent to serve the disadvantaged, the funds were 
available to pay for only the supplemental or additional costs of 
providing services to the disadvantaged.
    (9) Maintenance-of-effort requirement. An LEA participates in a 
Federal program in fiscal year 1988 that requires it to maintain its 
expenditures from non-Federal sources for program purposes to receive 
its full allotment. The program statute requires that non-Federal funds 
expended in the first preceding fiscal year must be at least 90 percent 
of non-Federal funds expended in the second preceding fiscal year and 
provides for a reduction in grant amount proportional to the shortfall 
in expenditures. No waiver of the requirement is authorized. In fiscal 
year 1986 the LEA spent $100,000 from non-Federal sources for program 
purposes; in fiscal year 1987, only $87,000. Result: The LEA must return 
\1/30\ of its fiscal year 1988 grant--the amount of its grant that 
equals the proportion of its shortfall ($3,000) to the required level of 
expenditures ($90,000). If, instead, the statute made maintenance of 
expenditures a clear condition of the LEA's eligibility to receive funds 
and did not provide for a proportional reduction in the grant award, the 
LEA would be required to return its entire grant.
    (10) Supplanting prohibition. An LEA uses funds under a Federal drug 
education program to provide drug abuse prevention counseling to 
students in the eighth grade. The LEA is required to provide that same 
counseling under State law. Funds under the Federal program statute are 
subject to a supplement-not-supplant requirement. Result: All the funds 
used to provide the required counseling to the eighth-grade students 
must be returned. The Federal funds did not increase the total amount of 
spending for program purposes because the counseling would have been 
provided with non-Federal funds if the Federal funds were not available.
    (11) Matching requirement. A State receives an allotment of $90,000 
for fiscal year 1988 under a Federal adult education program. It expends 
its full allotment and $8,000 from its own resources for adult 
education. Under the Federal statute, the Federal share of expenditures 
for the State's program is 90 percent. Result: The State must return the 
unmatched Federal funds, or $18,000. Expenditure of a $90,000 Federal 
allotment required $10,000 in matching State expenditures, $2,000 more 
than the State's actual expenditures. At a ratio of one State dollar for 
every nine Federal dollars, $18,000 in Federal funds were unmatched.
    (12) Application requirements. In order to receive funds under a 
Federal program that supports a wide range of activities designed to 
improve the quality of elementary and secondary education, an LEA 
submits an application to its State educational agency (SEA) for a 
subgrant to carry out school-level basic skills development programs. 
The LEA submits its application after conducting an assessment of the 
needs of its students in consultation with parents, teachers, community 
leaders, and interested members of the general public. The Federal 
program statute requires the application and consultation processes. The 
SEA reviews the LEA's application, determines that the proposed programs 
are sound and the application is in compliance with Federal law, and 
approves the application. After the LEA receives the subgrant, it 
unilaterally decides to use 20 percent of the funds for gifted and

[[Page 199]]

talented elementary school students--an authorized activity under the 
Federal statute. However, the LEA does not consult with interested 
parties and does not amend its application. Result: 20 percent of the 
LEA's subgrant must be returned. The LEA had no legal authority to use 
Federal funds for programs or activities other than those described in 
its approved application, and its actions with respect to 20 percent of 
the subgrant not only impaired the integrity of the application process, 
but caused significant harm to other Federal interests associated with 
the program as follows: the required planning process was circumvented 
because the LEA did not consult with the specified local interests; 
program accountability was impaired because neither the SEA nor the 
various local interests that were to be consulted had an opportunity to 
review and comment on the merits of the gifted and talented program 
activities, and the LEA never had to justify those activities to them; 
and fiscal accountability was impaired because the SEA and those various 
local interests were, in effect, misled by the LEA's unamended 
application regarding the expenditure of Federal funds.
    (13) Harmless violation. Under a Federal program, a grantee is 
required to establish a 15-member advisory council of affected teachers, 
school administrators, parents, and students to assist in program 
design, monitoring, and evaluation. Although the law requires at least 
three student members of the council, a grantee's council contains only 
two. The project is carried out, and no damage to the project 
attributable to the lack of a third student member can be identified. 
Result: No financial recovery is required, although the grantee must 
take other appropriate steps to come into compliance with the law. The 
grantee's violation has not measurably harmed a Federal interest 
associated with the program.

(Authority: 20 U.S.C. 1221e-3, 1234(f)(1), 1234b(a), and 3474(a))

[54 FR 19512, May 5, 1989; 54 FR 21622, May 19, 1989]



PART 82_NEW RESTRICTIONS ON LOBBYING--Table of Contents



                            Subpart A_General

Sec.
82.100  Conditions on use of funds.
82.105  Definitions.
82.110  Certification and disclosure.

                  Subpart B_Activities by Own Employees

82.200  Agency and legislative liaison.
82.205  Professional and technical services.
82.210  Reporting.

            Subpart C_Activities by Other Than Own Employees

82.300  Professional and technical services.

                   Subpart D_Penalties and Enforcement

82.400  Penalties.
82.405  Penalty procedures.
82.410  Enforcement.

                          Subpart E_Exemptions

82.500  Secretary of Defense.

                        Subpart F_Agency Reports

82.600  Semi-annual compilation.
82.605  Inspector General report.

Appendix A to Part 82--Certification Regarding Lobbying
Appendix B to Part 82--Disclosure Form To Report Lobbying

    Authority: Section 319, Pub. L. 101-121 (31 U.S.C. 1352); 20 U.S.C. 
3474.

    Source: 55 FR 6737, 6752, Feb. 26, 1990, unless otherwise noted.

    Cross Reference: See also Office of Management and Budget notice 
published at 54 FR 52306, December 20, 1989.



                            Subpart A_General



Sec. 82.100  Conditions on use of funds.

    (a) No appropriated funds may be expended by the recipient of a 
Federal contract, grant, loan, or cooperative ageement to pay any person 
for influencing or attempting to influence an officer or employee of any 
agency, a Member of Congress, an officer or employee of Congress, or an 
employee of a Member of Congress in connection with any of the following 
covered Federal actions: the awarding of any Federal contract, the 
making of any Federal grant, the making of any Federal loan, the 
entering into of any cooperative agreement, and the extension, 
continuation, renewal, amendment, or modification of any Federal 
contract, grant, loan, or cooperative agreement.
    (b) Each person who requests or receives from an agency a Federal 
contract, grant, loan, or cooperative agreement shall file with that 
agency a certification, set forth in appendix A, that the person has not 
made, and will not make, any payment prohibited by paragraph (a) of this 
section.

[[Page 200]]

    (c) Each person who requests or receives from an agency a Federal 
contract, grant, loan, or a cooperative agreement shall file with that 
agency a disclosure form, set forth in appendix B, if such person has 
made or has agreed to make any payment using nonappropriated funds (to 
include profits from any covered Federal action), which would be 
prohibited under paragraph (a) of this section if paid for with 
appropriated funds.
    (d) Each person who requests or receives from an agency a commitment 
providing for the United States to insure or guarantee a loan shall file 
with that agency a statement, set forth in appendix A, whether that 
person has made or has agreed to make any payment to influence or 
attempt to influence an officer or employee of any agency, a Member of 
Congress, an officer or employee of Congress, or an employee of a Member 
of Congress in connection with that loan insurance or guarantee.
    (e) Each person who requests or receives from an agency a commitment 
providing for the United States to insure or guarantee a loan shall file 
with that agency a disclosure form, set forth in appendix B, if that 
person has made or has agreed to make any payment to influence or 
attempt to influence an officer or employee of any agency, a Member of 
Congress, an officer or employee of Congress, or an employee of a Member 
of Congress in connection with that loan insurance or guarantee.



Sec. 82.105  Definitions.

    For purposes of this part:
    (a) Agency, as defined in 5 U.S.C. 552(f), includes Federal 
executive departments and agencies as well as independent regulatory 
commissions and Government corporations, as defined in 31 U.S.C. 
9101(1).
    (b) Covered Federal action means any of the following Federal 
actions:
    (1) The awarding of any Federal contract;
    (2) The making of any Federal grant;
    (3) The making of any Federal loan;
    (4) The entering into of any cooperative agreement; and,
    (5) The extension, continuation, renewal, amendment, or modification 
of any Federal contract, grant, loan, or cooperative agreement.

Covered Federal action does not include receiving from an agency a 
commitment providing for the United States to insure or guarantee a 
loan. Loan guarantees and loan insurance are addressed independently 
within this part.
    (c) Federal contract means an acquisition contract awarded by an 
agency, including those subject to the Federal Acquisition Regulation 
(FAR), and any other acquisition contract for real or personal property 
or services not subject to the FAR.
    (d) Federal cooperative agreement means a cooperative agreement 
entered into by an agency.
    (e) Federal grant means an award of financial assistance in the form 
of money, or property in lieu of money, by the Federal Government or a 
direct appropriation made by law to any person. The term does not 
include technical assistance which provides services instead of money, 
or other assistance in the form of revenue sharing, loans, loan 
guarantees, loan insurance, interest subsidies, insurance, or direct 
United States cash assistance to an individual.
    (f) Federal loan means a loan made by an agency. The term does not 
include loan guarantee or loan insurance.
    (g) Indian tribe and tribal organization have the meaning provided 
in section 4 of the Indian Self-Determination and Education Assistance 
Act (25 U.S.C. 450B). Alaskan Natives are included under the definitions 
of Indian tribes in that Act.
    (h) Influencing or attempting to influence means making, with the 
intent to influence, any communication to or appearance before an 
officer or employee or any agency, a Member of Congress, an officer or 
employee of Congress, or an employee of a Member of Congress in 
connection with any covered Federal action.
    (i) Loan guarantee and loan insurance means an agency's guarantee or 
insurance of a loan made by a person.
    (j) Local government means a unit of government in a State and, if 
chartered, established, or otherwise recognized by a State for the 
performance of a governmental duty, including a local

[[Page 201]]

public authority, a special district, an intrastate district, a council 
of governments, a sponsor group representative organization, and any 
other instrumentality of a local government.
    (k) Officer or employee of an agency includes the following 
individuals who are employed by an agency:
    (1) An individual who is appointed to a position in the Government 
under title 5, U.S. Code, including a position under a temporary 
appointment;
    (2) A member of the uniformed services as defined in section 101(3), 
title 37, U.S. Code;
    (3) A special Government employee as defined in section 202, title 
18, U.S. Code; and,
    (4) An individual who is a member of a Federal advisory committee, 
as defined by the Federal Advisory Committee Act, title 5, U.S. Code 
appendix 2.
    (l) Person means an individual, corporation, company, association, 
authority, firm, partnership, society, State, and local government, 
regardless of whether such entity is operated for profit or not for 
profit. This term excludes an Indian tribe, tribal organization, or any 
other Indian organization with respect to expenditures specifically 
permitted by other Federal law.
    (m) Reasonable compensation means, with respect to a regularly 
employed officer or employee of any person, compensation that is 
consistent with the normal compensation for such officer or employee for 
work that is not furnished to, not funded by, or not furnished in 
cooperation with the Federal Government.
    (n) Reasonable payment means, with respect to perfessional and other 
technical services, a payment in an amount that is consistent with the 
amount normally paid for such services in the private sector.
    (o) Recipient includes all contractors, subcontractors at any tier, 
and subgrantees at any tier of the recipient of funds received in 
connection with a Federal contract, grant, loan, or cooperative 
agreement. The term excludes an Indian tribe, tribal organization, or 
any other Indian organization with respect to expenditures specifically 
permitted by other Federal law.
    (p) Regularly employed means, with respect to an officer or employee 
of a person requesting or receiving a Federal contract, grant, loan, or 
cooperative agreement or a commitment providing for the United States to 
insure or guarantee a loan, an officer or employee who is employed by 
such person for at least 130 working days within one year immediately 
preceding the date of the submission that initiates agency consideration 
of such person for receipt of such contract, grant, loan, cooperative 
agreement, loan insurance commitment, or loan guarantee commitment. An 
officer or employee who is employed by such person for less than 130 
working days within one year immediately preceding the date of the 
submission that initiates agency consideration of such person shall be 
considered to be regularly employed as soon as he or she is employed by 
such person for 130 working days.
    (q) State means a State of the United States, the District of 
Columbia, the Commonwealth of Puerto Rico, a territory or possession of 
the United States, an agency or instrumentality of a State, and a multi-
State, regional, or interstate entity having governmental duties and 
powers.



Sec. 82.110  Certification and disclosure.

    (a) Each person shall file a certification, and a disclosure form, 
if required, with each submission that initiates agency consideration of 
such person for:
    (1) Award of a Federal contract, grant, or cooperative agreement 
exceeding $100,000; or
    (2) An award of a Federal loan or a commitment providing for the 
United States to insure or guarantee a loan exceeding $150,000.
    (b) Each person shall file a certification, and a disclosure form, 
if required, upon receipt by such person of:
    (1) A Federal contract, grant, or cooperative agreement exceeding 
$100,000; or
    (2) A Federal loan or a commitment providing for the United States 
to insure or guarantee a loan exceeding $150,000,

Unless such person previously filed a certification, and a disclosure 
form, if

[[Page 202]]

required, under paragraph (a) of this section.
    (c) Each person shall file a disclosure form at the end of each 
calendar quarter in which there occurs any event that requires 
disclosure or that materially affects the accuracy of the information 
contained in any disclosure form previously filed by such person under 
paragraphs (a) or (b) of this section. An event that materially affects 
the accuracy of the information reported includes:
    (1) A cumulative increase of $25,000 or more in the amount paid or 
expected to be paid for influencing or attempting to influence a covered 
Federal action; or
    (2) A change in the person(s) or individual(s) influencing or 
attempting to influence a covered Federal action; or,
    (3) A change in the officer(s), employee(s), or Member(s) contacted 
to influence or attempt to influence a covered Federal action.
    (d) Any person who requests or receives from a person referred to in 
paragraphs (a) or (b) of this section:
    (1) A subcontract exceeding $100,000 at any tier under a Federal 
contract;
    (2) A subgrant, contract, or subcontract exceeding $100,000 at any 
tier under a Federal grant;
    (3) A contract or subcontract exceeding $100,000 at any tier under a 
Federal loan exceeding $150,000; or,
    (4) A contract or subcontract exceeding $100,000 at any tier under a 
Federal cooperative agreement,

Shall file a certification, and a disclosure form, if required, to the 
next tier above.
    (e) All disclosure forms, but not certifications, shall be forwarded 
from tier to tier until received by the person referred to in paragraphs 
(a) or (b) of this section. That person shall forward all disclosure 
forms to the agency.
    (f) Any certification or disclosure form filed under paragraph (e) 
of this section shall be treated as a material representation of fact 
upon which all receiving tiers shall rely. All liability arising from an 
erroneous representation shall be borne solely by the tier filing that 
representation and shall not be shared by any tier to which the 
erroneous representation is forwarded. Submitting an erroneous 
certification or disclosure constitutes a failure to file the required 
certification or disclosure, respectively. If a person fails to file a 
required certification or disclosure, the United States may pursue all 
available remedies, including those authorized by section 1352, title 
31, U.S. Code.
    (g) For awards and commitments in process prior to December 23, 
1989, but not made before that date, certifications shall be required at 
award or commitment, covering activities occurring between December 23, 
1989, and the date of award or commitment. However, for awards and 
commitments in process prior to the December 23, 1989 effective date of 
these provisions, but not made before December 23, 1989, disclosure 
forms shall not be required at time of award or commitment but shall be 
filed within 30 days.
    (h) No reporting is required for an activity paid for with 
appropriated funds if that activity is allowable under either subpart B 
or C.



                  Subpart B_Activities by Own Employees



Sec. 82.200  Agency and legislative liaison.

    (a) The prohibition on the use of appropriated funds, in 
Sec. 82.100(a), does not apply in the case of a payment of reasonable 
compensation made to an officer or employee of a person requesting or 
receiving a Federal contract, grant, loan, or cooperative agreement if 
the payment is for agency and legislative liaison activities not 
directly related to a covered Federal action.
    (b) For purposes of paragraph (a) of this section, providing any 
information specifically requested by an agency or Congress is allowable 
at any time.
    (c) For purposes of paragraph (a) of this section, the following 
agency and legislative liaison activities are allowable at any time only 
where they are not related to a specific solicitation for any covered 
Federal action:
    (1) Discussing with an agency (including individual demonstrations) 
the qualities and characteristics of the person's products or services, 
conditions or terms of sale, and service capabilities; and,
    (2) Technical discussions and other activities regarding the 
application or

[[Page 203]]

adaptation of the person's products or services for an agency's use.
    (d) For purposes of paragraph (a) of this section, the following 
agencies and legislative liaison activities are allowable only where 
they are prior to formal solicitation of any covered Federal action:
    (1) Providing any information not specifically requested but 
necessary for an agency to make an informed decision about initiation of 
a covered Federal action;
    (2) Technical discussions regarding the preparation of an 
unsolicited proposal prior to its official submission; and,
    (3) Capability presentations by persons seeking awards from an 
agency pursuant to the provisions of the Small Business Act, as amended 
by Pub. L. 95-507 and other subsequent amendments.
    (e) Only those activities expressly authorized by this section are 
allowable under this section.



Sec. 82.205  Professional and technical services.

    (a) The prohibition on the use of appropriated funds, in 
Sec. 82.100(a), does not apply in the case of a payment of reasonable 
compensation made to an officer or employee of a person requesting or 
receiving a Federal contract, grant, loan, or cooperative agreement or 
an extension, continuation, renewal, amendment, or modification of a 
Federal contract, grant, loan, or cooperative agreement if payment is 
for professional or technical services rendered directly in the 
preparation, submission, or negotiation of any bid, proposal, or 
application for that Federal contract, grant, loan, or cooperative 
agreement or for meeting requirements imposed by or pursuant to law as a 
condition for receiving that Federal contract, grant, loan, or 
cooperative agreement.
    (b) For purposes of paragraph (a) of this section, ``professional 
and technical services'' shall be limited to advice and analysis 
directly applying any professional or technical discipline. For example, 
drafting of a legal document accompanying a bid or proposal by a lawyer 
is allowable. Similarly, technical advice provided by an engineer on the 
performance or operational capability of a piece of equipment rendered 
directly in the negotiation of a contract is allowable. However, 
communications with the intent to influence made by a professional (such 
as a licensed lawyer) or a technical person (such as a licensed 
accountant) are not allowable under this section unless they provide 
advice and analysis directly applying their professional or technical 
expertise and unless the advice or analysis is rendered directly and 
solely in the preparation, submission or negotiation of a covered 
Federal action. Thus, for example, communications with the intent to 
influence made by a lawyer that do not provide legal advice or analysis 
directly and solely related to the legal aspects of his or her client's 
proposal, but generally advocate one proposal over another are not 
allowable under this section because the lawyer is not providing 
professional legal services. Similarly, communications with the intent 
to influence made by an engineer providing an engineering analysis prior 
to the preparation or submission of a bid or proposal are not allowable 
under this section since the engineer is providing technical services 
but not directly in the preparation, submission or negotiation of a 
covered Federal action.
    (c) Requirements imposed by or pursuant to law as a condition for 
receiving a covered Federal award include those required by law or 
regulation, or reasonably expected to be required by law or regulation, 
and any other requirements in the actual award documents.
    (d) Only those services expressly authorized by this section are 
allowable under this section.



Sec. 82.210  Reporting.

    No reporting is required with respect to payments of reasonable 
compensation made to regularly employed officers or employees of a 
person.

[[Page 204]]



            Subpart C_Activities by Other Than Own Employees



Sec. 82.300  Professional and technical services.

    (a) The prohibition on the use of appropriated funds, in 
Sec. 82.100(a), does not apply in the case of any reasonable payment to 
a person, other than an officer or employee of a person requesting or 
receiving a covered Federal action, if the payment is for professional 
or technical services rendered directly in the preparation, submission, 
or negotiation of any bid, proposal, or application for that Federal 
contract, grant, loan, or cooperative agreement or for meeting 
requirements imposed by or pursuant to law as a condition for receiving 
that Federal contract, grant, loan, or cooperative agreement.
    (b) The reporting requirements in Sec. 82.110(a) and (b) regarding 
filing a disclosure form by each person, if required, shall not apply 
with respect to professional or technical services rendered directly in 
the preparation, submission, or negotiation of any commitment providing 
for the United States to insure or guarantee a loan.
    (c) For purposes of paragraph (a) of this section, ``professional 
and technical services'' shall be limited to advice and analysis 
directly applying any professional or technical discipline. For example, 
drafting or a legal document accompanying a bid or proposal by a lawyer 
is allowable. Similarly, technical advice provided by an engineer on the 
performance or operational capability of a piece of equipment rendered 
directly in the negotiation of a contract is allowable. However, 
communications with the intent to influence made by a professional (such 
as a licensed lawyer) or a technical person (such as a licensed 
accountant) are not allowable under this section unless they provide 
advice and analysis directly applying their professional or technical 
expertise and unless the advice or analysis is rendered directly and 
solely in the preparation, submission or negotiation of a covered 
Federal action. Thus, for example, communications with the intent to 
influence made by a lawyer that do not provide legal advice or analysis 
directly and solely related to the legal aspects of his or her client's 
proposal, but generally advocate one proposal over another are not 
allowable under this section because the lawyer is not providing 
professional legal services. Similarly, communications with the intent 
to influence made by an engineer providing an engineering analysis prior 
to the preparation or submission of a bid or proposal are not allowable 
under this section since the engineer is providing technical services 
but not directly in the preparation, submission or negotiation of a 
covered Federal action.
    (d) Requirements imposed by or pursuant to law as a condition for 
receiving a covered Federal award include those required by law or 
regulation, or reasonably expected to be required by law or regulation, 
and any other requirements in the actual award documents.
    (e) Persons other than officers or employees of a person requesting 
or receiving a covered Federal action include consultants and trade 
associations.
    (f) Only those services expressly authorized by this section are 
allowable under this section.



                   Subpart D_Penalties and Enforcement



Sec. 82.400  Penalties.

    (a) Any person who makes an expenditure prohibited herein shall be 
subject to a civil penalty of not less than $10,000 and not more than 
$100,000 for each such expenditure.
    (b) Any person who fails to file or amend the disclosure form (see 
appendix B) to be filed or amended if required herein, shall be subject 
to a civil penalty of not less than $10,000 and not more than $100,000 
for each such failure.
    (c) A filing or amended filing on or after the date on which an 
administrative action for the imposition of a civil penalty is commenced 
does not prevent the imposition of such civil penalty for a failure 
occurring before that date. An administrative action is commenced with 
respect to a failure when an investigating official determines in 
writing to commence an investigation of an allegation of such failure.

[[Page 205]]

    (d) In determining whether to impose a civil penalty, and the amount 
of any such penalty, by reason of a violation by any person, the agency 
shall consider the nature, circumstances, extent, and gravity of the 
violation, the effect on the ability of such person to continue in 
business, any prior violations by such person, the degree of culpability 
of such person, the ability of the person to pay the penalty, and such 
other matters as may be appropriate.
    (e) First offenders under paragraphs (a) or (b) of this section 
shall be subject to a civil penalty of $10,000, absent aggravating 
circumstances. Second and subsequent offenses by persons shall be 
subject to an appropriate civil penalty between $10,000 and $100,000, as 
determined by the agency head or his or her designee.
    (f) An imposition of a civil penalty under this section does not 
prevent the United States from seeking any other remedy that may apply 
to the same conduct that is the basis for the imposition of such civil 
penalty.



Sec. 82.405  Penalty procedures.

    Agencies shall impose and collect civil penalties pursuant to the 
provisions of the Program Fraud and Civil Remedies Act, 31 U.S.C. 
sections 3803 (except subsection (c)), 3804, 3805, 3806, 3807, 3808, and 
3812, insofar as these provisions are not inconsistent with the 
requirements herein.



Sec. 82.410  Enforcement.

    The head of each agency shall take such actions as are necessary to 
ensure that the provisions herein are vigorously implemented and 
enforced in that agency.



                          Subpart E_Exemptions



Sec. 82.500  Secretary of Defense.

    (a) The Secretary of Defense may exempt, on a case-by-case basis, a 
covered Federal action from the prohibition whenever the Secretary 
determines, in writing, that such an exemption is in the national 
interest. The Secretary shall transmit a copy of each such written 
exemption to Congress immediately after making such a determination.
    (b) The Department of Defense may issue supplemental regulations to 
implement paragraph (a) of this section.



                        Subpart F_Agency Reports



Sec. 82.600  Semi-annual compilation.

    (a) The head of each agency shall collect and compile the disclosure 
reports (see appendix B) and, on May 31 and November 30 of each year, 
submit to the Secretary of the Senate and the Clerk of the House of 
Representatives a report containing a compilation of the information 
contained in the disclosure reports received during the six-month period 
ending on March 31 or September 30, respectively, of that year.
    (b) The report, including the compilation, shall be available for 
public inspection 30 days after receipt of the report by the Secretary 
and the Clerk.
    (c) Information that involves intelligence matters shall be reported 
only to the Select Committee on Intelligence of the Senate, the 
Permanent Select Committee on Intelligence of the House of 
Representatives, and the Committees on Appropriations of the Senate and 
the House of Representatives in accordance with procedures agreed to by 
such committees. Such information shall not be available for public 
inspection.
    (d) Information that is classified under Executive Order 12356 or 
any successor order shall be reported only to the Committee on Foreign 
Relations of the Senate and the Committee on Foreign Affairs of the 
House of Representatives or the Committees on Armed Services of the 
Senate and the House of Representatives (whichever such committees have 
jurisdiction of matters involving such information) and to the 
Committees on Appropriations of the Senate and the House of 
Representatives in accordance with procedures agreed to by such 
committees. Such information shall not be available for public 
inspection.
    (e) The first semi-annual compilation shall be submitted on May 31, 
1990, and shall contain a compilation of the disclosure reports received 
from December 23, 1989 to March 31, 1990.
    (f) Major agencies, designated by the Office of Management and 
Budget

[[Page 206]]

(OMB), are required to provide machine-readable compilations to the 
Secretary of the Senate and the Clerk of the House of Representatives no 
later than with the compilations due on May 31, 1991. OMB shall provide 
detailed specifications in a memorandum to these agencies.
    (g) Non-major agencies are requested to provide machine-readable 
compilations to the Secretary of the Senate and the Clerk of the House 
of Representatives.
    (h) Agencies shall keep the originals of all disclosure reports in 
the official files of the agency.



Sec. 82.605  Inspector General report.

    (a) The Inspector General, or other official as specified in 
paragraph (b) of this section, of each agency shall prepare and submit 
to Congress each year, commencing with submission of the President's 
Budget in 1991, an evaluation of the compliance of that agency with, and 
the effectiveness of, the requirements herein. The evaluation may 
include any recommended changes that may be necessary to strengthen or 
improve the requirements.
    (b) In the case of an agency that does not have an Inspector 
General, the agency official comparable to an Inspector General shall 
prepare and submit the annual report, or, if there is no such comparable 
official, the head of the agency shall prepare and submit the annual 
report.
    (c) The annual report shall be submitted at the same time the agency 
submits its annual budget justifications to Congress.
    (d) The annual report shall include the following: All alleged 
violations relating to the agency's covered Federal actions during the 
year covered by the report, the actions taken by the head of the agency 
in the year covered by the report with respect to those alleged 
violations and alleged violations in previous years, and the amounts of 
civil penalties imposed by the agency in the year covered by the report.



      Sec. Appendix A to Part 82--Certification Regarding Lobbying

 Certification for Contracts, Grants, Loans, and Cooperative Agreements

    The undersigned certifies, to the best of his or her knowledge and 
belief, that:
    (1) No Federal appropriated funds have been paid or will be paid, by 
or on behalf of the undersigned, to any person for influencing or 
attempting to influence an officer or employee of an agency, a Member of 
Congress, an officer or employee of Congress, or an employee of a Member 
of Congress in connection with the awarding of any Federal contract, the 
making of any Federal grant, the making of any Federal loan, the 
entering into of any cooperative agreement, and the extension, 
continuation, renewal, amendment, or modification of any Federal 
contract, grant, loan, or cooperative agreement.
    (2) If any funds other than Federal appropriated funds have been 
paid or will be paid to any person for influencing or attempting to 
influence an officer or employee of any agency, a Member of Congress, an 
officer or employee of Congress, or an employee of a Member of Congress 
in connection with this Federal contract, grant, loan, or cooperative 
agreement, the undersigned shall complete and submit Standard Form-LLL, 
``Disclosure Form to Report Lobbying,'' in accordance with its 
instructions.
    (3) The undersigned shall require that the language of this 
certification be included in the award documents for all subawards at 
all tiers (including subcontracts, subgrants, and contracts under 
grants, loans, and cooperative agreements) and that all subrecipients 
shall certify and disclose accordingly.
    This certification is a material representation of fact upon which 
reliance was placed when this transaction was made or entered into. 
Submission of this certification is a prerequisite for making or 
entering into this transaction imposed by section 1352, title 31, U.S. 
Code. Any person who fails to file the required certification shall be 
subject to a civil penalty of not less than $10,000 and not more than 
$100,000 for each such failure.

            Statement for Loan Guarantees and Loan Insurance

    The undersigned states, to the best of his or her knowledge and 
belief, that:
    If any funds have been paid or will be paid to any person for 
influencing or attempting to influence an officer or employee of any 
agency, a Member of Congress, an officer or employee of Congress, or an 
employee of a Member of Congress in connection with this commitment 
providing for the United States to insure or guarantee a loan, the 
undersigned shall complete and submit Standard Form-LLL, ``Disclosure 
Form to Report Lobbying,'' in accordance with its instructions.

[[Page 207]]

    Submission of this statement is a prerequisite for making or 
entering into this transaction imposed by section 1352, title 31, U.S. 
Code. Any person who fails to file the required statement shall be 
subject to a civil penalty of not less than $10,000 and not more than 
$100,000 for each such failure.

[[Page 208]]



     Sec. Appendix B to Part 82--Disclosure Form To Report Lobbying
[GRAPHIC] [TIFF OMITTED] TC21OC91.056


[[Page 209]]


[GRAPHIC] [TIFF OMITTED] TC21OC91.057


[[Page 210]]


[GRAPHIC] [TIFF OMITTED] TC21OC91.058


[[Page 211]]





PART 84_GOVERNMENTWIDE REQUIREMENTS FOR DRUG-FREE WORKPLACE
(FINANCIAL ASSISTANCE)--Table of Contents



                     Subpart A_Purpose and Coverage

Sec.
84.100  What does this part do?
84.105  Does this part apply to me?
84.110  Are any of my Federal assistance awards exempt from this part?
84.115  Does this part affect the Federal contracts that I receive?

      Subpart B_Requirements for Recipients Other Than Individuals

84.200  What must I do to comply with this part?
84.205  What must I include in my drug-free workplace statement?
84.210  To whom must I distribute my drug-free workplace statement?
84.215  What must I include in my drug-free awareness program?
84.220  By when must I publish my drug-free workplace statement and 
          establish my drug-free awareness program?
84.225  What actions must I take concerning employees who are convicted 
          of drug violations in the workplace?
84.230  How and when must I identify workplaces?

        Subpart C_Requirements for Recipients Who Are Individuals

84.300  What must I do to comply with this part if I am an individual 
          recipient?
84.301  [Reserved]

           Subpart D_Responsibilities of ED Awarding Officials

84.400  What are my responsibilities as an ED awarding official?

           Subpart E_Violations of This Part and Consequences

84.500  How are violations of this part determined for recipients other 
          than individuals?
84.505  How are violations of this part determined for recipients who 
          are individuals?
84.510  What actions will the Federal Government take against a 
          recipient determined to have violated this part?
84.515  Are there any exceptions to those actions?

                          Subpart F_Definitions

84.605  Award.
84.610  Controlled substance.
84.615  Conviction.
84.620  Cooperative agreement.
84.625  Criminal drug statute.
84.630  Debarment.
84.635  Drug-free workplace.
84.640  Employee.
84.645  Federal agency or agency.
84.650  Grant.
84.655  Individual.
84.660  Recipient.
84.665  State.
84.670  Suspension.

    Authority: E.O.s 12549 and 12689; 20 U.S.C. 1082, 1094, 1221e-3 and 
3474; and Sec. 2455, Pub. L. 103-355, 108 Stat. 3243 at 3327, unless 
otherwise noted.

    Source: 68 FR 66557, 66610, Nov. 26, 2003, unless otherwise noted.



                     Subpart A_Purpose and Coverage



Sec. 84.100  What does this part do?

    This part carries out the portion of the Drug-Free Workplace Act of 
1988 (41 U.S.C. 701 et seq., as amended) that applies to grants. It also 
applies the provisions of the Act to cooperative agreements and other 
financial assistance awards, as a matter of Federal Government policy.

(Authority: E.O.s 12549 and 12689; 20 U.S.C. 1082, 1094, 1221e-3 and 
3474; and Sec. 2455, Pub. L. 103-355, 108 Stat. 3243 at 3327)



Sec. 84.105  Does this part apply to me?

    (a) Portions of this part apply to you if you are either--
    (1) A recipient of an assistance award from the Department of 
Education; or
    (2) A(n) ED awarding official. (See definitions of award and 
recipient in Secs. 84.605 and 84.660, respectively.)
    (b) The following table shows the subparts that apply to you:

------------------------------------------------------------------------
            If you are . . .                    see subparts . . .
------------------------------------------------------------------------
(1) A recipient who is not an            A, B and E.
 individual.
(2) A recipient who is an individual...  A, C and E.
(3) A(n) ED awarding official..........  A, D and E.
------------------------------------------------------------------------


[[Page 212]]


(Authority: E.O.s 12549 and 12689; 20 U.S.C. 1082, 1094, 1221e-3 and 
3474; and Sec. 2455, Pub. L. 103-355, 108 Stat. 3243 at 3327)



Sec. 84.110  Are any of my Federal assistance awards exempt from 
this part?

    This part does not apply to any award that the ED Deciding Official 
determines that the application of this part would be inconsistent with 
the international obligations of the United States or the laws or 
regulations of a foreign government.

(Authority: E.O.s 12549 and 12689; 20 U.S.C. 1082, 1094, 1221e-3 and 
3474; and Sec. 2455, Pub. L. 103-355, 108 Stat. 3243 at 3327)



Sec. 84.115  Does this part affect the Federal contracts that
I receive?

    It will affect future contract awards indirectly if you are debarred 
or suspended for a violation of the requirements of this part, as 
described in Sec. 84.510(c). However, this part does not apply directly 
to procurement contracts. The portion of the Drug-Free Workplace Act of 
1988 that applies to Federal procurement contracts is carried out 
through the Federal Acquisition Regulation in chapter 1 of Title 48 of 
the Code of Federal Regulations (the drug-free workplace coverage 
currently is in 48 CFR part 23, subpart 23.5).

(Authority: E.O.s 12549 and 12689; 20 U.S.C. 1082, 1094, 1221e-3 and 
3474; and Sec. 2455, Pub. L. 103-355, 108 Stat. 3243 at 3327)



      Subpart B_Requirements for Recipients Other Than Individuals



Sec. 84.200  What must I do to comply with this part?

    There are two general requirements if you are a recipient other than 
an individual.
    (a) First, you must make a good faith effort, on a continuing basis, 
to maintain a drug-free workplace. You must agree to do so as a 
condition for receiving any award covered by this part. The specific 
measures that you must take in this regard are described in more detail 
in subsequent sections of this subpart. Briefly, those measures are to--
    (1) Publish a drug-free workplace statement and establish a drug-
free awareness program for your employees (see Secs. 84.205 through 
84.220); and
    (2) Take actions concerning employees who are convicted of violating 
drug statutes in the workplace (see Sec. 84.225).
    (b) Second, you must identify all known workplaces under your 
Federal awards (see Sec. 84.230).

(Authority: E.O.s 12549 and 12689; 20 U.S.C. 1082, 1094, 1221e-3 and 
3474; and Sec. 2455, Pub. L. 103-355, 108 Stat. 3243 at 3327)



Sec. 84.205  What must I include in my drug-free workplace statement?

    You must publish a statement that--
    (a) Tells your employees that the unlawful manufacture, 
distribution, dispensing, possession, or use of a controlled substance 
is prohibited in your workplace;
    (b) Specifies the actions that you will take against employees for 
violating that prohibition; and
    (c) Lets each employee know that, as a condition of employment under 
any award, he or she:
    (1) Will abide by the terms of the statement; and
    (2) Must notify you in writing if he or she is convicted for a 
violation of a criminal drug statute occurring in the workplace and must 
do so no more than five calendar days after the conviction.

(Authority: E.O.s 12549 and 12689; 20 U.S.C. 1082, 1094, 1221e-3 and 
3474; and Sec. 2455, Pub. L. 103-355, 108 Stat. 3243 at 3327)



Sec. 84.210  To whom must I distribute my drug-free workplace 
statement?

    You must require that a copy of the statement described in 
Sec. 84.205 be given to each employee who will be engaged in the 
performance of any Federal award.

(Authority: E.O.s 12549 and 12689; 20 U.S.C. 1082, 1094, 1221e-3 and 
3474; and Sec. 2455, Pub. L. 103-355, 108 Stat. 3243 at 3327)



Sec. 84.215  What must I include in my drug-free awareness program?

    You must establish an ongoing drug-free awareness program to inform 
employees about--

[[Page 213]]

    (a) The dangers of drug abuse in the workplace;
    (b) Your policy of maintaining a drug-free workplace;
    (c) Any available drug counseling, rehabilitation, and employee 
assistance programs; and
    (d) The penalties that you may impose upon them for drug abuse 
violations occurring in the workplace.

(Authority: E.O.s 12549 and 12689; 20 U.S.C. 1082, 1094, 1221e-3 and 
3474; and Sec. 2455, Pub. L. 103-355, 108 Stat. 3243 at 3327)



Sec. 84.220  By when must I publish my drug-free workplace statement 
and establish my drug-free awareness program?

    If you are a new recipient that does not already have a policy 
statement as described in Sec. 84.205 and an ongoing awareness program 
as described in Sec. 84.215, you must publish the statement and 
establish the program by the time given in the following table:

------------------------------------------------------------------------
                If . . .                          then you . . .
------------------------------------------------------------------------
(a) The performance period of the award  must have the policy statement
 is less than 30 days.                    and program in place as soon
                                          as possible, but before the
                                          date on which performance is
                                          expected to be completed.
(b) The performance period of the award  must have the policy statement
 is 30 days or more.                      and program in place within 30
                                          days after award.
(c) You believe there are extraordinary  may ask the ED awarding
 circumstances that will require more     official to give you more time
 than 30 days for you to publish the      to do so. The amount of
 policy statement and establish the       additional time, if any, to be
 awareness program.                       given is at the discretion of
                                          the awarding official.
------------------------------------------------------------------------


(Authority: E.O.s 12549 and 12689; 20 U.S.C. 1082, 1094, 1221e-3 and 
3474; and Sec. 2455, Pub. L. 103-355, 108 Stat. 3243 at 3327)



Sec. 84.225  What actions must I take concerning employees who are 
convicted of drug violations in the workplace?

    There are two actions you must take if an employee is convicted of a 
drug violation in the workplace:
    (a) First, you must notify Federal agencies if an employee who is 
engaged in the performance of an award informs you about a conviction, 
as required by Sec. 84.205(c)(2), or you otherwise learn of the 
conviction. Your notification to the Federal agencies must--
    (1) Be in writing;
    (2) Include the employee's position title;
    (3) Include the identification number(s) of each affected award;
    (4) Be sent within ten calendar days after you learn of the 
conviction; and
    (5) Be sent to every Federal agency on whose award the convicted 
employee was working. It must be sent to every awarding official or his 
or her official designee, unless the Federal agency has specified a 
central point for the receipt of the notices.
    (b) Second, within 30 calendar days of learning about an employee's 
conviction, you must either--
    (1) Take appropriate personnel action against the employee, up to 
and including termination, consistent with the requirements of the 
Rehabilitation Act of 1973 (29 U.S.C. 794), as amended; or
    (2) Require the employee to participate satisfactorily in a drug 
abuse assistance or rehabilitation program approved for these purposes 
by a Federal, State or local health, law enforcement, or other 
appropriate agency.

(Authority: E.O.s 12549 and 12689; 20 U.S.C. 1082, 1094, 1221e-3 and 
3474; and Sec. 2455, Pub. L. 103-355, 108 Stat. 3243 at 3327)



Sec. 84.230  How and when must I identify workplaces?

    (a) You must identify all known workplaces under each ED award. A 
failure to do so is a violation of your drug-free workplace 
requirements. You may identify the workplaces--
    (1) To the ED official that is making the award, either at the time 
of application or upon award; or
    (2) In documents that you keep on file in your offices during the 
performance of the award, in which case you must make the information 
available for inspection upon request by ED officials or their 
designated representatives.

[[Page 214]]

    (b) Your workplace identification for an award must include the 
actual address of buildings (or parts of buildings) or other sites where 
work under the award takes place. Categorical descriptions may be used 
(e.g., all vehicles of a mass transit authority or State highway 
department while in operation, State employees in each local 
unemployment office, performers in concert halls or radio studios).
    (c) If you identified workplaces to the ED awarding official at the 
time of application or award, as described in paragraph (a)(1) of this 
section, and any workplace that you identified changes during the 
performance of the award, you must inform the ED awarding official.

(Authority: E.O.s 12549 and 12689; 20 U.S.C. 1082, 1094, 1221e-3 and 
3474; and Sec. 2455, Pub. L. 103-355, 108 Stat. 3243 at 3327)



        Subpart C_Requirements for Recipients Who Are Individuals



Sec. 84.300  What must I do to comply with this part if I am an
individual recipient?

    As a condition of receiving a(n) ED award, if you are an individual 
recipient, you must agree that--
    (a) You will not engage in the unlawful manufacture, distribution, 
dispensing, possession, or use of a controlled substance in conducting 
any activity related to the award; and
    (b) If you are convicted of a criminal drug offense resulting from a 
violation occurring during the conduct of any award activity, you will 
report the conviction:
    (1) In writing.
    (2) Within 10 calendar days of the conviction.
    (3) To the ED awarding official or other designee for each award 
that you currently have, unless Sec. 84.301 or the award document 
designates a central point for the receipt of the notices. When notice 
is made to a central point, it must include the identification number(s) 
of each affected award.

(Authority: E.O.s 12549 and 12689; 20 U.S.C. 1082, 1094, 1221e-3 and 
3474; and Sec. 2455, Pub. L. 103-355, 108 Stat. 3243 at 3327)



Sec. 84.301  [Reserved]



           Subpart D_Responsibilities of ED Awarding Officials



Sec. 84.400  What are my responsibilities as a(n) ED awarding official?

    As a(n) ED awarding official, you must obtain each recipient's 
agreement, as a condition of the award, to comply with the requirements 
in--
    (a) Subpart B of this part, if the recipient is not an individual; 
or
    (b) Subpart C of this part, if the recipient is an individual.

(Authority: E.O.s 12549 and 12689; 20 U.S.C. 1082, 1094, 1221e-3 and 
3474; and Sec. 2455, Pub. L. 103-355, 108 Stat. 3243 at 3327)



           Subpart E_Violations of this Part and Consequences



Sec. 84.500  How are violations of this part determined for 
recipients other than individuals?

    A recipient other than an individual is in violation of the 
requirements of this part if the ED Deciding Official determines, in 
writing, that--
    (a) The recipient has violated the requirements of subpart B of this 
part; or
    (b) The number of convictions of the recipient's employees for 
violating criminal drug statutes in the workplace is large enough to 
indicate that the recipient has failed to make a good faith effort to 
provide a drug-free workplace.

(Authority: E.O.s 12549 and 12689; 20 U.S.C. 1082, 1094, 1221e-3 and 
3474; and Sec. 2455, Pub. L. 103-355, 108 Stat. 3243 at 3327)



Sec. 84.505  How are violations of this part determined for recipients
who are individuals?

    An individual recipient is in violation of the requirements of this 
part if the ED Deciding Official determines, in writing, that--
    (a) The recipient has violated the requirements of subpart C of this 
part; or
    (b) The recipient is convicted of a criminal drug offense resulting 
from a violation occurring during the conduct of any award activity.

(Authority: E.O.s 12549 and 12689; 20 U.S.C. 1082, 1094, 1221e-3 and 
3474; and Sec. 2455, Pub. L. 103-355, 108 Stat. 3243 at 3327)

[[Page 215]]



Sec. 84.510  What actions will the Federal Government take against
a recipient determined to have violated this part?

    If a recipient is determined to have violated this part, as 
described in Sec. 84.500 or Sec. 84.505, the Department of Education may 
take one or more of the following actions--
    (a) Suspension of payments under the award;
    (b) Suspension or termination of the award; and
    (c) Suspension or debarment of the recipient under 34 CFR Part 85, 
for a period not to exceed five years.

(Authority: E.O.s 12549 and 12689; 20 U.S.C. 1082, 1094, 1221e-3 and 
3474; and Sec. 2455, Pub. L. 103-355, 108 Stat. 3243 at 3327)



Sec. 84.515  Are there any exceptions to those actions?

    The ED Deciding Official may waive with respect to a particular 
award, in writing, a suspension of payments under an award, suspension 
or termination of an award, or suspension or debarment of a recipient if 
the ED Deciding Official determines that such a waiver would be in the 
public interest. This exception authority cannot be delegated to any 
other official.

(Authority: E.O.s 12549 and 12689; 20 U.S.C. 1082, 1094, 1221e-3 and 
3474; and Sec. 2455, Pub. L. 103-355, 108 Stat. 3243 at 3327)



                          Subpart F_Definitions



Sec. 84.605  Award.

    Award means an award of financial assistance by the Department of 
Education or other Federal agency directly to a recipient.
    (a) The term award includes:
    (1) A Federal grant or cooperative agreement, in the form of money 
or property in lieu of money.
    (2) A block grant or a grant in an entitlement program, whether or 
not the grant is exempted from coverage under the Governmentwide rule 34 
CFR Part 85 that implements OMB Circular A-102 (for availability, see 5 
CFR 1310.3) and specifies uniform administrative requirements.
    (b) The term award does not include:
    (1) Technical assistance that provides services instead of money.
    (2) Loans.
    (3) Loan guarantees.
    (4) Interest subsidies.
    (5) Insurance.
    (6) Direct appropriations.
    (7) Veterans' benefits to individuals (i.e., any benefit to 
veterans, their families, or survivors by virtue of the service of a 
veteran in the Armed Forces of the United States).

(Authority: E.O.s 12549 and 12689; 20 U.S.C. 1082, 1094, 1221e-3 and 
3474; and Sec. 2455, Pub. L. 103-355, 108 Stat. 3243 at 3327)



Sec. 84.610  Controlled substance.

    Controlled substance means a controlled substance in schedules I 
through V of the Controlled Substances Act (21 U.S.C. 812), and as 
further defined by regulation at 21 CFR 1308.11 through 1308.15.

(Authority: E.O.s 12549 and 12689; 20 U.S.C. 1082, 1094, 1221e-3 and 
3474; and Sec. 2455, Pub. L. 103-355, 108 Stat. 3243 at 3327)



Sec. 84.615  Conviction.

    Conviction means a finding of guilt (including a plea of nolo 
contendere) or imposition of sentence, or both, by any judicial body 
charged with the responsibility to determine violations of the Federal 
or State criminal drug statutes.

(Authority: E.O.s 12549 and 12689; 20 U.S.C. 1082, 1094, 1221e-3 and 
3474; and Sec. 2455, Pub. L. 103-355, 108 Stat. 3243 at 3327)



Sec. 84.620  Cooperative agreement.

    Cooperative agreement means an award of financial assistance that, 
consistent with 31 U.S.C. 6305, is used to enter into the same kind of 
relationship as a grant (see definition of grant in Sec. 84.650), except 
that substantial involvement is expected between the Federal agency and 
the recipient when carrying out the activity contemplated by the award. 
The term does not include cooperative research and development 
agreements as defined in 15 U.S.C. 3710a.

(Authority: E.O.s 12549 and 12689; 20 U.S.C. 1082, 1094, 1221e-3 and 
3474; and Sec. 2455, Pub. L. 103-355, 108 Stat. 3243 at 3327)

[[Page 216]]



Sec. 84.625  Criminal drug statute.

    Criminal drug statute means a Federal or non-Federal criminal 
statute involving the manufacture, distribution, dispensing, use, or 
possession of any controlled substance.

(Authority: E.O.s 12549 and 12689; 20 U.S.C. 1082, 1094, 1221e-3 and 
3474; and Sec. 2455, Pub. L. 103-355, 108 Stat. 3243 at 3327)



Sec. 84.630  Debarment.

    Debarment means an action taken by a Federal agency to prohibit a 
recipient from participating in Federal Government procurement contracts 
and covered nonprocurement transactions. A recipient so prohibited is 
debarred, in accordance with the Federal Acquisition Regulation for 
procurement contracts (48 CFR part 9, subpart 9.4) and the common rule, 
Government-wide Debarment and Suspension (Nonprocurement), that 
implements Executive Order 12549 and Executive Order 12689.

(Authority: E.O.s 12549 and 12689; 20 U.S.C. 1082, 1094, 1221e-3 and 
3474; and Sec. 2455, Pub. L. 103-355, 108 Stat. 3243 at 3327)



Sec. 84.635  Drug-free workplace.

    Drug-free workplace means a site for the performance of work done in 
connection with a specific award at which employees of the recipient are 
prohibited from engaging in the unlawful manufacture, distribution, 
dispensing, possession, or use of a controlled substance.

(Authority: E.O.s 12549 and 12689; 20 U.S.C. 1082, 1094, 1221e-3 and 
3474; and Sec. 2455, Pub. L. 103-355, 108 Stat. 3243 at 3327)



Sec. 84.640  Employee.

    (a) Employee means the employee of a recipient directly engaged in 
the performance of work under the award, including--
    (1) All direct charge employees;
    (2) All indirect charge employees, unless their impact or 
involvement in the performance of work under the award is insignificant 
to the performance of the award; and
    (3) Temporary personnel and consultants who are directly engaged in 
the performance of work under the award and who are on the recipient's 
payroll.
    (b) This definition does not include workers not on the payroll of 
the recipient (e.g., volunteers, even if used to meet a matching 
requirement; consultants or independent contractors not on the payroll; 
or employees of subrecipients or subcontractors in covered workplaces).

(Authority: E.O.s 12549 and 12689; 20 U.S.C. 1082, 1094, 1221e-3 and 
3474; and Sec. 2455, Pub. L. 103-355, 108 Stat. 3243 at 3327)



Sec. 84.645  Federal agency or agency.

    Federal agency or agency means any United States executive 
department, military department, government corporation, government 
controlled corporation, any other establishment in the executive branch 
(including the Executive Office of the President), or any independent 
regulatory agency.

(Authority: E.O.s 12549 and 12689; 20 U.S.C. 1082, 1094, 1221e-3 and 
3474; and Sec. 2455, Pub. L. 103-355, 108 Stat. 3243 at 3327)



Sec. 84.650  Grant.

    Grant means an award of financial assistance that, consistent with 
31 U.S.C. 6304, is used to enter into a relationship--
    (a) The principal purpose of which is to transfer a thing of value 
to the recipient to carry out a public purpose of support or stimulation 
authorized by a law of the United States, rather than to acquire 
property or services for the Federal Government's direct benefit or use; 
and
    (b) In which substantial involvement is not expected between the 
Federal agency and the recipient when carrying out the activity 
contemplated by the award.

(Authority: E.O.s 12549 and 12689; 20 U.S.C. 1082, 1094, 1221e-3 and 
3474; and Sec. 2455, Pub. L. 103-355, 108 Stat. 3243 at 3327)



Sec. 84.655  Individual.

    Individual means a natural person.

(Authority: E.O.s 12549 and 12689; 20 U.S.C. 1082, 1094, 1221e-3 and 
3474; and Sec. 2455, Pub. L. 103-355, 108 Stat. 3243 at 3327)



Sec. 84.660  Recipient.

    Recipient means any individual, corporation, partnership, 
association, unit of government (except a Federal agency) or legal 
entity, however organized,

[[Page 217]]

that receives an award directly from a Federal agency.

(Authority: E.O.s 12549 and 12689; 20 U.S.C. 1082, 1094, 1221e-3 and 
3474; and Sec. 2455, Pub. L. 103-355, 108 Stat. 3243 at 3327)



Sec. 84.665  State.

    State means any of the States of the United States, the District of 
Columbia, the Commonwealth of Puerto Rico, or any territory or 
possession of the United States.

(Authority: E.O.s 12549 and 12689; 20 U.S.C. 1082, 1094, 1221e-3 and 
3474; and Sec. 2455, Pub. L. 103-355, 108 Stat. 3243 at 3327)



Sec. 84.670  Suspension.

    Suspension means an action taken by a Federal agency that 
immediately prohibits a recipient from participating in Federal 
Government procurement contracts and covered nonprocurement transactions 
for a temporary period, pending completion of an investigation and any 
judicial or administrative proceedings that may ensue. A recipient so 
prohibited is suspended, in accordance with the Federal Acquisition 
Regulation for procurement contracts (48 CFR part 9, subpart 9.4) and 
the common rule, Government-wide Debarment and Suspension 
(Nonprocurement), that implements Executive Order 12549 and Executive 
Order 12689. Suspension of a recipient is a distinct and separate action 
from suspension of an award or suspension of payments under an award.

(Authority: E.O.s 12549 and 12689; 20 U.S.C. 1082, 1094, 1221e-3 and 
3474; and Sec. 2455, Pub. L. 103-355, 108 Stat. 3243 at 3327)



PART 86_DRUG AND ALCOHOL ABUSE PREVENTION--Table of Contents



                            Subpart A_General

Sec.
86.1  What is the purpose of the Drug and Alcohol Abuse Prevention 
          regulations?
86.2  What Federal programs are covered by this part?
86.3  What actions shall an IHE take to comply with the requirements of 
          this part?
86.4  What are the procedures for submitting a drug prevention program 
          certification?
86.5  What are the consequences if an IHE fails to submit a drug 
          prevention program certification?
86.6  When must an IHE submit a drug prevention program certification?
86.7  What definitions apply to this part?

               Subpart B_Institutions of Higher Education

86.100  What must the IHE's drug prevention program include?
86.101  What review of IHE drug prevention programs does the Secretary 
          conduct?
86.102  What is required of an IHE that the Secretary selects for annual 
          review?
86.103  What records and information must an IHE make available to the 
          Secretary and the public concerning its drug prevention 
          program?

Subpart C [Reserved]

Subpart D_Responses and Sanctions Issued or Imposed by the Secretary for 
                          Violations by an IHE

86.300  What constitutes a violation of this part by an IHE?
86.301  What actions may the Secretary take if an IHE violates this 
          part?
86.302  What are the procedures used by the Secretary for providing 
          information or technical assistance?
86.303  What are the procedures used by the Secretary for issuing a 
          response other than the formulation of a compliance agreement 
          or the provision of information or technical assistance?
86.304  What are the procedures used by the Secretary to demand 
          repayment of Federal financial assistance or terminate an 
          IHE's eligibility for any or all forms of Federal financial 
          assistance?

                       Subpart E_Appeal Procedures

86.400  What is the scope of this subpart?
86.401  What are the authority and responsibility of the ALJ?
86.402  Who may be a party in a hearing under this subpart?
86.403  May a party be represented by counsel?
86.404  How may a party communicate with an ALJ?
86.405  What are the requirements for filing written submissions?
86.406  What must the ALJ do if the parties enter settlement 
          negotiations?
86.407  What are the procedures for scheduling a hearing?
86.408  What are the procedures for conducting a pre-hearing conference?
86.409  What are the procedures for conducting a hearing on the record?
86.410  What are the procedures for issuance of a decision?
86.411  What are the procedures for requesting reinstatement of 
          eligibility?


[[Page 218]]


    Authority: 20 U.S.C. 1145g, unless otherwise noted.

    Source: 55 FR 33581, Aug. 16, 1990, unless otherwise noted.



                            Subpart A_General



Sec. 86.1  What is the purpose of the Drug and Alcohol Abuse 
Prevention regulations?

    The purpose of the Drug and Alcohol Abuse Prevention regulations is 
to implement section 22 of the Drug-Free Schools and Communities Act 
Amendments of 1989, which added section 1213 to the Higher Education 
Act. These amendments require that, as a condition of receiving funds or 
any other form of financial assistance under any Federal program, an 
institution of higher education (IHE) must certify that it has adopted 
and implemented a drug prevention program as described in this part.

(Authority: 20 U.S.C. 1145g)

[61 FR 66225, Dec. 17, 1996]



Sec. 86.2  What Federal programs are covered by this part?

    The Federal programs covered by this part include--
    (a) All programs administered by the Department of Education under 
which an IHE may receive funds or any other form of Federal financial 
assistance; and
    (b) All programs administered by any other Federal agency under 
which an IHE may receive funds or any other form of Federal financial 
assistance.

(Authority: 20 U.S.C. 1145g)

[55 FR 33581, Aug. 16, 1990, as amended at 61 FR 66225, Dec. 17, 1996]



Sec. 86.3  What actions shall an IHE take to comply with the
requirements of this part?

    (a) An IHE shall adopt and implement a drug prevention program as 
described in Sec. 86.100 to prevent the unlawful possession, use, or 
distribution of illicit drugs and alcohol by all students and employees 
on school premises or as part of any of its activities.
    (b) An IHE shall provide a written certification that it has adopted 
and implemented the drug prevention program described in Sec. 86.100.

(Approved by the Office of Management and Budget under control number 
1880-0522)

(Authority: 20 U.S.C. 1145g)

[55 FR 33581, Aug. 16, 1990, as amended at 61 FR 66225, 66226, Dec. 17, 
1996]



Sec. 86.4  What are the procedures for submitting a drug prevention
program certification?

    An IHE shall submit to the Secretary the drug prevention program 
certification required by Sec. 86.3(b).

(Approved by the Office of Management and Budget under control number 
1880-0522)

(Authority: 20 U.S.C. 1145g)

[55 FR 33581, Aug. 16, 1990, as amended at 61 FR 66226, Dec. 17, 1996]



Sec. 86.5  What are the consequences if an IHE fails to submit
a drug prevention program certification?

    (a) An IHE that fails to submit a drug prevention program 
certification is not eligible to receive funds or any other form of 
financial assistance under any Federal program.
    (b) The effect of loss of eligibility to receive funds or any other 
form of Federal financial assistance is determined by the statute and 
regulations governing the Federal programs under which an IHE receives 
or desires to receive assistance.

(Authority: 20 U.S.C. 1145g)

[55 FR 33581, Aug. 16, 1990, as amended at 61 FR 66225, Dec. 17, 1996]



Sec. 86.6  When must an IHE submit a drug prevention program
certification?

    (a) After October 1, 1990, except as provided in paragraph (b) of 
this section, an IHE is not eligible to receive funds or any other form 
of financial assistance under any Federal program until the IHE has 
submitted a drug prevention program certification.
    (b)(1) The Secretary may allow an IHE until not later than April 1, 
1991, to submit the drug prevention program certification, only if the 
IHE establishes that it has a need, other than administrative 
convenience, for more time to adopt and implement its drug prevention 
program.

[[Page 219]]

    (2) An IHE that wants to receive an extension of time to submit its 
drug prevention program certification shall submit a written 
justification to the Secretary that--
    (i) Describes each part of its drug prevention program, whether in 
effect or planned;
    (ii) Provides a schedule to complete and implement its drug 
prevention program; and
    (iii) Explains why it has a need, other than administrative 
convenience, for more time to adopt and implement its drug prevention 
program.
    (3) An IHE shall submit a request for an extension to the Secretary.

(Approved by the Office of Management and Budget under control number 
1880-0522)

(Authority: 20 U.S.C. 1145g)

[55 FR 33581, Aug. 16, 1990, as amended at 61 FR 66226, Dec. 17, 1996]



Sec. 86.7  What definitions apply to this part?

    (a) Definitions in EDGAR. The following terms used in this part are 
defined in 34 CFR part 77:


Department

EDGAR

Secretary
    (b) Other definitions. The following terms used in this part are 
defined as follows:
    Compliance agreement means an agreement between the Secretary and an 
IHE that is not in full compliance with its drug prevention program 
certification. The agreement specifies the steps the IHE will take to 
comply fully with its drug prevention program certification, and 
provides a schedule for the accomplishment of those steps. A compliance 
agreement does not excuse or remedy past violations of this part.
    Institution of higher education means--
    (1) An institution of higher education, as defined in 34 CFR 600.4;
    (2) A proprietary institution of higher education, as defined in 34 
CFR 600.5;
    (3) A postsecondary vocational institution, as defined in 34 CFR 
600.6; and
    (4) A vocational school, as defined in 34 CFR 600.7.

(Authority: 20 U.S.C. 1145g)

[55 FR 33581, Aug. 16, 1990, as amended at 61 FR 66226, Dec. 17, 1996]



               Subpart B_Institutions of Higher Education



Sec. 86.100  What must the IHE's drug prevention program include?

    The IHE's drug prevention program must, at a minimum, include the 
following:
    (a) The annual distribution in writing to each employee, and to each 
student who is taking one or more classes for any type of academic 
credit except for continuing education units, regardless of the length 
of the student's program of study, of--
    (1) Standards of conduct that clearly prohibit, at a minimum, the 
unlawful possession, use, or distribution of illicit drugs and alcohol 
by students and employees on its property or as part of any of its 
activities;
    (2) A description of the applicable legal sanctions under local, 
State, or Federal law for the unlawful possession or distribution of 
illicit drugs and alcohol;
    (3) A description of the health risks associated with the use of 
illicit drugs and the abuse of alcohol;
    (4) A description of any drug or alcohol counseling, treatment, or 
rehabilitation or re-entry programs that are available to employees or 
students; and
    (5) A clear statement that the IHE will impose disciplinary 
sanctions on students and employees (consistent with local, State, and 
Federal law), and a description of those sanctions, up to and including 
expulsion or termination of employment and referral for prosecution, for 
violations of the standards of conduct required by paragraph (a)(1) of 
this section. For the purpose of this section, a disciplinary sanction 
may include the completion of an appropriate rehabilitation program.
    (b) A biennial review by the IHE of its program to--
    (1) Determine its effectiveness and implement changes to the program 
if they are needed; and
    (2) Ensure that the disciplinary sanctions described in paragraph 
(a)(5) of this section are consistently enforced.

(Approved by the Office of Management and Budget under control number 
1880-0522)

(Authority: 20 U.S.C. 1145g)

[[Page 220]]



Sec. 86.101  What review of IHE drug prevention programs does 
the Secretary conduct?

    The Secretary annually reviews a representative sample of IHE drug 
prevention programs.

(Authority: 20 U.S.C. 1145g)



Sec. 86.102  What is required of an IHE that the Secretary selects 
for annual review?

    If the Secretary selects an IHE for review under Sec. 86.101, the 
IHE shall provide the Secretary access to personnel, records, documents 
and any other necessary information requested by the Secretary to review 
the IHE's adoption and implementation of its drug prevention program.

(Approved by the Office of Management and Budget under control number 
1880-0522)

(Authority: 20 U.S.C. 1145g)



Sec. 86.103  What records and information must an IHE make available
to the Secretary and the public concerning its drug prevention 
program?

    (a) Each IHE that provides the drug prevention program certification 
required by Sec. 86.3(b) shall, upon request, make available to the 
Secretary and the public a copy of each item required by Sec. 86.100(a) 
as well as the results of the biennial review required by 
Sec. 86.100(b).
    (b)(1) An IHE shall retain the following records for three years 
after the fiscal year in which the record was created:
    (i) The items described in paragraph (a) of this section.
    (ii) Any other records reasonably related to the IHE's compliance 
with the drug prevention program certification.
    (2) If any litigation, claim, negotiation, audit, review, or other 
action involving the records has been started before expiration of the 
three-year period, the IHE shall retain the records until completion of 
the action and resolution of all issues that arise from it, or until the 
end of the regular three-year period, whichever is later.

(Approved by the Office of Management and Budget under control number 
1880-0522)

(Authority: 20 U.S.C. 1145g)

Subpart C [Reserved]



Subpart D_Responses and Sanctions Issued or Imposed by the Secretary for 
                          Violations by an IHE



Sec. 86.300  What constitutes a violation of this part by an IHE?

    An IHE violates this part by--
    (a) Receiving any form of Federal financial assistance after 
becoming ineligible to receive that assistance because of failure to 
submit a certification in accordance with Sec. 86.3(b); or
    (b) Violating its certification. Violation of a certification 
includes failure of an IHE to--
    (1) Adopt or implement its drug prevention program; or
    (2) Consistently enforce its disciplinary sanctions for violations 
by students and employees of the standards of conduct adopted by an IHE 
under Sec. 86.100(a)(1).

(Authority: 20 U.S.C. 1145g)

[55 FR 33581, Aug. 16, 1990, as amended at 61 FR 66226, Dec. 17, 1996]



Sec. 86.301  What actions may the Secretary take if an IHE violates 
this part?

    (a) If an IHE violates its certification, the Secretary may issue a 
response to the IHE. A response may include, but is not limited to--
    (1) Provision of information and technical assistance; and
    (2) Formulation of a compliance agreement designed to bring the IHE 
into full compliance with this part as soon as feasible.
    (b) If an IHE receives any form of Federal financial assistance 
without having submitted a certification or violates its certification, 
the Secretary may impose one or more sanctions on the IHE, including--
    (1) Repayment of any or all forms of Federal financial assistance 
received by the IHE when it was in violation of this part; and
    (2) The termination of any or all forms of Federal financial 
assistance that--
    (i)(A) Except as specified in paragraph (b)(2)(ii) of this section, 
ends an IHE's eligibility to receive any or all

[[Page 221]]

forms of Federal financial assistance. The Secretary specifies which 
forms of Federal financial assistance would be affected; and
    (B) Prohibits an IHE from making any new obligations against Federal 
funds; and
    (ii) For purposes of an IHE's participation in the student financial 
assistance programs authorized by title IV of the Higher Education Act 
of 1965 as amended, has the same effect as a termination under 34 CFR 
668.94.

(Authority: 20 U.S.C. 1145g)

[55 FR 33581, Aug. 16, 1990, as amended at 61 FR 66225, Dec. 17, 1996]



Sec. 86.302  What are the procedures used by the Secretary for
providing information or technical assistance?

    (a) The Secretary provides information or technical assistance to an 
IHE in writing, through site visits, or by other means.
    (b) The IHE shall inform the Secretary of any corrective action it 
has taken within a period specified by the Secretary.

(Authority: 20 U.S.C. 1145g)

[55 FR 33581, Aug. 16, 1990, as amended at 61 FR 66225, Dec. 17, 1996]



Sec. 86.303  What are the procedures used by the Secretary for issuing
a response other than the formulation of a compliance agreement or 
the provision of information or technical assistance?

    (a) If the Secretary intends to issue a response other than the 
formulation of a compliance agreement or the provision of information or 
technical assistance, the Secretary notifies the IHE in writing of--
    (1) The Secretary's determination that there are grounds to issue a 
response other than the formulation of a compliance agreement or 
providing information or technical assistance; and
    (2) The response the Secretary intends to issue.
    (b) An IHE may submit written comments to the Secretary on the 
determination under paragraph (a)(1) of this section and the intended 
response under paragraph (a)(2) of this section within 30 days after the 
date the IHE receives the notification of the Secretary's intent to 
issue a response.
    (c) Based on the initial notification and the written comments of 
the IHE the Secretary makes a final determination and, if appropriate, 
issues a final response.
    (d) The IHE shall inform the Secretary of the corrective action it 
has taken in order to comply with the terms of the Secretary's response 
within a period specified by the Secretary.
    (e) If an IHE does not comply with the terms of a response issued by 
the Secretary, the Secretary may issue an additional response or impose 
a sanction on the IHE in accordance with the procedures in Sec. 86.304.

(Authority: 20 U.S.C. 1145g)

[55 FR 33581, Aug. 16, 1990, as amended at 61 FR 66225, Dec. 17, 1996]



Sec. 86.304  What are the procedures used by the Secretary to demand
repayment of Federal financial assistance or terminate an IHE's
eligibility for any or all forms of Federal financial assistance?

    (a) A designated Department official begins a proceeding for 
repayment of Federal financial assistance or termination, or both, of an 
IHE's eligibility for any or all forms of Federal financial assistance 
by sending the IHE a notice by certified mail with return receipt 
requested. This notice--
    (1) Informs the IHE of the Secretary's intent to demand repayment of 
Federal financial assistance or to terminate, describes the consequences 
of that action, and identifies the alleged violations that constitute 
the basis for the action;
    (2) Specifies, as appropriate--
    (i) The amount of Federal financial assistance that must be repaid 
and the date by which the IHE must repay the funds; and
    (ii) The proposed effective date of the termination, which must be 
at least 30 days after the date of receipt of the notice of intent; and
    (3) Informs the IHE that the repayment of Federal financial 
assistance will not be required or that the termination will not be 
effective on the date specified in the notice if the designated 
Department official receives, within a 30-day period beginning on the 
date the IHE receives the notice of intent described in this paragraph--

[[Page 222]]

    (i) Written material indicating why the repayment of Federal 
financial assistance or termination should not take place; or
    (ii) A request for a hearing that contains a concise statement of 
disputed issues of law and fact, the IHE's position with respect to 
these issues, and, if appropriate, a description of which Federal 
financial assistance the IHE contends need not be repaid.
    (b) If the IHE does not request a hearing but submits written 
material--
    (1) The IHE receives no additional opportunity to request or receive 
a hearing; and
    (2) The designated Department official, after considering the 
written material, notifies the IHE in writing whether--
    (i) Any or all of the Federal financial assistance must be repaid; 
or
    (ii) The proposed termination is dismissed or imposed as of a 
specified date.

(Authority: 20 U.S.C. 1145g)

[55 FR 33581, Aug. 16, 1990, as amended at 61 FR 66225, Dec. 17, 1996]



                       Subpart E_Appeal Procedures



Sec. 86.400  What is the scope of this subpart?

    (a) The procedures in this subpart are the exclusive procedures 
governing appeals of decisions by a designated Department official to 
demand the repayment of Federal financial assistance or terminate the 
eligibility of an IHE to receive some or all forms of Federal financial 
assistance for violations of this part.
    (b) An Administrative Law Judge (ALJ) hears appeals under this 
subpart.

(Authority: 20 U.S.C. 1145g)

[55 FR 33581, Aug. 16, 1990, as amended at 61 FR 66225, Dec. 17, 1996]



Sec. 86.401  What are the authority and responsibility of the ALJ?

    (a) The ALJ regulates the course of the proceeding and conduct of 
the parties during the hearing and takes all steps necessary to conduct 
a fair and impartial proceeding.
    (b) The ALJ is not authorized to issue subpoenas.
    (c) The ALJ takes whatever measures are appropriate to expedite the 
proceeding. These measures may include, but are not limited to--
    (1) Scheduling of conferences;
    (2) Setting time limits for hearings and submission of written 
documents; and
    (3) Terminating the hearing and issuing a decision against a party 
if that party does not meet those time limits.
    (d) The scope of the ALJ's review is limited to determining 
whether--
    (1) The IHE received any form of Federal financial assistance after 
becoming ineligible to receive that assistance because of failure to 
submit a certification; or
    (2) The IHE violated its certification.

(Authority: 20 U.S.C. 1145g)

[55 FR 33581, Aug. 16, 1990, as amended at 61 FR 66225, Dec. 17, 1996]



Sec. 86.402  Who may be a party in a hearing under this subpart?

    (a) Only the designated Department official and the IHE that is the 
subject of the proposed termination or recovery of Federal financial 
assistance may be parties in a hearing under this subpart.
    (b) Except as provided in this subpart, no person or organization 
other than a party may participate in a hearing under this subpart.

(Authority: 20 U.S.C. 1145g)

[55 FR 33581, Aug. 16, 1990, as amended at 61 FR 66225, Dec. 17, 1996]



Sec. 86.403  May a party be represented by counsel?

    A party may be represented by counsel.

(Authority: 20 U.S.C. 1145g)



Sec. 86.404  How may a party communicate with an ALJ?

    (a) A party may not communicate with an ALJ on any fact at issue in 
the case or on any matter relevant to the merits of the case unless the 
other party is given notice and an opportunity to participate.
    (b)(1) To obtain an order or ruling from an ALJ, a party shall make 
a motion to the ALJ.

[[Page 223]]

    (2) Except for a request for an extension of time, a motion must be 
made in writing unless the parties appear in person or participate in a 
conference telephone call. The ALJ may require a party to reduce an oral 
motion to writing.
    (3) If a party files a written motion, the party shall do so in 
accordance with Sec. 86.405.
    (4) Except for a request for an extension of time, the ALJ may not 
grant a party's written motion without the consent of the other party 
unless the other party has had at least 21 days from the date of service 
of the motion to respond. However, the ALJ may deny a motion without 
awaiting a response.
    (5) The date of service of a motion is determined by the standards 
for determining a filing date in Sec. 86.405(d).

(Authority: 20 U.S.C. 1145g)



Sec. 86.405  What are the requirements for filing written submissions?

    (a) Any written submission under this subpart 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) If a party files a brief or other document, the party shall 
serve a copy of the filed material on the other party on the filing date 
by hand-delivery or by mail. If agreed upon by the parties, service of a 
document may be made upon the other party by facsimile transmission.
    (c) Any written submission must be accompanied by a statement 
certifying the date that the filed material was filed and served on the 
other party.
    (d)(1) The filing date for a written submission is the date the 
document is--
    (i) Hand-delivered;
    (ii) Mailed; or
    (iii) Sent by facsimile transmission.
    (2) If a scheduled filing date falls on a Saturday, Sunday, or 
Federal holiday, the filing deadline is the next Federal business day.
    (e) A party filing by facsimile transmission is responsible for 
confirming that a complete and legible copy of the document was received 
by the Department.
    (f) If a document is filed by facsimile transmission, the Secretary 
or the designated Department official, as applicable, may require the 
filing of a follow-up hard copy by hand-delivery or by mail within a 
reasonable period of time.

(Authority: 20 U.S.C. 1145g)

[57 FR 56795, Nov. 30, 1992]



Sec. 86.406  What must the ALJ do if the parties enter settlement
negotiations?

    (a) If the parties to a case file a joint motion requesting a stay 
of the proceedings for settlement negotiations or for the parties to 
obtain approval of a settlement agreement, the ALJ grants the stay.
    (b) The following are not admissible in any proceeding under this 
part:
    (1) Evidence of conduct during settlement negotiations.
    (2) Statements made during settlement negotiations.
    (3) Terms of settlement offers.
    (c) The parties may not disclose the contents of settlement 
negotiations to the ALJ. If the parties enter into a settlement 
agreement and file a joint motion to dismiss the case, the ALJ grants 
the motion.

(Authority: 20 U.S.C. 1145g)



Sec. 86.407  What are the procedures for scheduling a hearing?

    (a) If the IHE requests a hearing by the time specified in 
Sec. 86.304(a)(3), the designated Department official sets the date and 
the place.
    (b)(1) The date is at least 15 days after the designated Department 
official receives the request and no later than 45 days after the 
request for hearing is received by the Department.
    (2) On the motion of either or both parties, the ALJ may extend the 
period before the hearing is scheduled beyond the 45 days specified in 
paragraph (b)(1) of this section.
    (c) No termination takes effect until after a hearing is held and a 
decision is issued by the Department.
    (d) With the approval of the ALJ and the consent of the designated 
Department official and the IHE, any time

[[Page 224]]

schedule specified in this section may be shortened.

(Authority: 20 U.S.C. 1145g)

[55 FR 33581, Aug. 16, 1990, as amended at 61 FR 66225, Dec. 17, 1996]



Sec. 86.408  What are the procedures for conducting a pre-hearing
conference?

    (a)(1) A pre-hearing conference may be convened by the ALJ if the 
ALJ thinks that such a conference would be useful, or if requested by--
    (i) The designated Department official; or
    (ii) The IHE.
    (2) The purpose of a pre-hearing conference is to allow the parties 
to settle, narrow, or clarify the dispute.
    (b) A pre-hearing conference may consist of--
    (1) A conference telephone call;
    (2) An informal meeting; or
    (3) The submission and exchange of written material.

(Authority: 20 U.S.C. 1145g)

[55 FR 33581, Aug. 16, 1990, as amended at 61 FR 66225, Dec. 17, 1996]



Sec. 86.409  What are the procedures for conducting a hearing on
the record?

    (a) A hearing on the record is an orderly presentation of arguments 
and evidence conducted by an ALJ.
    (b) An ALJ conducts the hearing entirely on the basis of briefs and 
other written submissions unless--
    (1) The ALJ determines, after reviewing all appropriate submissions, 
that an evidentiary hearing is needed to resolve a material factual 
issue in dispute; or
    (2) The ALJ determines, after reviewing all appropriate submissions, 
that oral argument is needed to clarify the issues in the case.
    (c) The hearing process may be expedited as agreed by the ALJ, the 
designated Department official, and the IHE. Procedures to expedite may 
include, but are not limited to, the following:
    (1) A restriction on the number or length of submissions.
    (2) The conduct of the hearing by telephone conference call.
    (3) A review limited to the written record.
    (4) A certification by the parties to facts and legal authorities 
not in dispute.
    (d)(1) The formal rules of evidence and procedures applicable to 
proceedings in a court of law are not applicable.
    (2) The designated Department official has the burden of persuasion 
in any proceeding under this subpart.
    (3)(i) The parties may agree to exchange relevant documents and 
information.
    (ii) The ALJ may not order discovery, as provided for under the 
Federal Rules of Civil Procedure, or any other exchange between the 
parties of documents or information.
    (4) The ALJ accepts only evidence that is relevant and material to 
the proceeding and is not unduly repetitious.
    (e) The ALJ makes a transcribed record of any evidentiary hearing or 
oral argument that is held, and makes the record available to--
    (1) The designated Department official; and
    (2) The IHE on its request and upon payment of a fee comparable to 
that prescribed under the Department of Education Freedom of Information 
Act regulations (34 CFR part 5).

(Authority: 20 U.S.C. 1145g)

[55 FR 33581, Aug. 16, 1990, as amended at 61 FR 66225, Dec. 17, 1996]



Sec. 86.410  What are the procedures for issuance of a decision?

    (a)(1) The ALJ issues a written decision to the IHE, the designated 
Department official, and the Secretary by certified mail, return receipt 
requested, within 30 days after--
    (i) The last brief is filed;
    (ii) The last day of the hearing if one is held; or
    (iii) The date on which the ALJ terminates the hearing in accordance 
with Sec. 86.401(c)(3).
    (2) The ALJ's decision states whether the violation or violations 
contained in the Secretary's notification occurred, and articulates the 
reasons for the ALJ's finding.

[[Page 225]]

    (3) The ALJ bases findings of fact only on evidence in the hearing 
record and on matters given judicial notice.
    (b)(1) The ALJ's decision is the final decision of the agency. 
However, the Secretary reviews the decision on request of either party, 
and may review the decision on his or her own initiative.
    (2) If the Secretary decides to review the decision on his or her 
own initiative, the Secretary informs the parties of his or her 
intention to review by written notice sent within 15 days of the 
Secretary's receipt of the ALJ's decision.
    (c)(1) Either party may request review by the Secretary by 
submitting a brief or written materials to the Secretary within 20 days 
of the party's receipt of the ALJ's decision. The submission must 
explain why the decision of the ALJ should be modified, reversed, or 
remanded. The other party shall respond within 20 days of receipt of the 
brief or written materials filed by the opposing party.
    (2) Neither party may introduce new evidence on review.
    (d) The decision of the ALJ ordering the repayment of Federal 
financial assistance or terminating the eligibility of an IHE does not 
take effect pending the Secretary's review.
    (e)(1) The Secretary reviews the ALJ's decision considering only 
evidence introduced into the record.
    (2) The Secretary's decision may affirm, modify, reverse or remand 
the ALJ's decision and includes a statement of reasons for the decision.

(Authority: 20 U.S.C. 1145g)

[55 FR 33581, Aug. 16, 1990, as amended at 61 FR 66225, Dec. 17, 1996]



Sec. 86.411  What are the procedures for requesting reinstatement
of eligibility?

    (a)(1) An IHE whose eligibility to receive any or all forms of 
Federal financial assistance has been terminated may file with the 
Department a request for reinstatement as an eligible entity no earlier 
than 18 months after the effective date of the termination.
    (2) In order to be reinstated, the IHE must demonstrate that it has 
corrected the violation or violations on which the termination was 
based, and that it has met any repayment obligation imposed upon it 
under Sec. 86.301(b)(1) of this part.
    (b) In addition to the requirements of paragraph (a) of this 
section, the IHE shall comply with the requirements and procedures for 
reinstatement of eligibility applicable to any Federal program under 
which it desires to receive Federal financial assistance.

(Authority: 20 U.S.C. 1145g)

[55 FR 33581, Aug. 16, 1990, as amended at 61 FR 66225, Dec. 17, 1996]



PART 97_PROTECTION OF HUMAN SUBJECTS--Table of Contents



Subpart A_Federal Policy for the Protection of Human Subjects (Basic ED 
            Policy for Protection of Human Research Subjects)

Sec.
97.101  To what does this policy apply?
97.102  Definitions.
97.103  Assuring compliance with this policy--research conducted or 
          supported by any Federal Department or Agency.
97.104-97.106  [Reserved]
97.107  IRB membership.
97.108  IRB functions and operations.
97.109  IRB review of research.
97.110  Expedited review procedures for certain kinds of research 
          involving no more than minimal risk, and for minor changes in 
          approved research.
97.111  Criteria for IRB approval of research.
97.112  Review by institution.
97.113  Suspension or termination of IRB approval of research.
97.114  Cooperative research.
97.115  IRB records.
97.116  General requirements for informed consent.
97.117  Documentation of informed consent.
97.118  Applications and proposals lacking definite plans for 
          involvement of human subjects.
97.119  Research undertaken without the intention of involving human 
          subjects.
97.120  Evaluation and disposition of applications and proposals for 
          research to be conducted or supported by a Federal Department 
          or Agency.
97.121  [Reserved]
97.122  Use of Federal funds.
97.123  Early termination of research support: Evaluation of 
          applications and proposals.
97.124  Conditions.

Subparts B-C [Reserved]

[[Page 226]]

  Subpart D_Additional ED Protections for Children Who are Subjects in 
                                Research

97.401  To what do these regulations apply?
97.402  Definitions.
97.403  IRB duties.
97.404  Research not involving greater than minimal risk.
97.405  Research involving greater than minimal risk but presenting the 
          prospect of direct benefit to the individual subjects.
97.406  Research involving greater than minimal risk and no prospect of 
          direct benefit to individual subjects, but likely to yield 
          generalizable knowledge about the subject's disorder or 
          condition.
97.407  Research not otherwise approvable which presents an opportunity 
          to understand, prevent, or alleviate a serious problem 
          affecting the health or welfare of children.
97.408  Requirements for permission by parents or guardians and for 
          assent by children.
97.409  Wards.

    Authority: 5 U.S.C. 301; 20 U.S.C. 1221e-3, 3474; 42 U.S.C. 300v-
1(b).

    Source: 56 FR 28012, 28021, June 18, 1991, unless otherwise noted.



Subpart A_Federal Policy for the Protection of Human Subjects (Basic ED 
            Policy for Protection of Human Research Subjects)

    Effective Date Note: At 82 FR 7272, Jan. 19, 2017, subpart A to part 
97 was revised, effective Jan. 19, 2018. The new subpart A will appear 
at the end of this subpart.



Sec. 97.101  To what does this policy apply?

    (a) Except as provided in paragraph (b) of this section, this policy 
applies to all research involving human subjects conducted, supported or 
otherwise subject to regulation by any federal department or agency 
which takes appropriate administrative action to make the policy 
applicable to such research. This includes research conducted by federal 
civilian employees or military personnel, except that each department or 
agency head may adopt such procedural modifications as may be 
appropriate from an administrative standpoint. It also includes research 
conducted, supported, or otherwise subject to regulation by the federal 
government outside the United States.
    (1) Research that is conducted or supported by a federal department 
or agency, whether or not it is regulated as defined in Sec. 97.102(e), 
must comply with all sections of this policy.
    (2) Research that is neither conducted nor supported by a federal 
department or agency but is subject to regulation as defined in 
Sec. 97.102(e) must be reviewed and approved, in compliance with 
Secs. 97.101, 97.102, and Secs. 97.107 through 97.117 of this policy, by 
an institutional review board (IRB) that operates in accordance with the 
pertinent requirements of this policy.
    (b) Unless otherwise required by department or agency heads, 
research activities in which the only involvement of human subjects will 
be in one or more of the following categories are exempt from this 
policy:
    (1) Research conducted in established or commonly accepted 
educational settings, involving normal educational practices, such as 
(i) research on regular and special education instructional strategies, 
or (ii) research on the effectiveness of or the comparison among 
instructional techniques, curricula, or classroom management methods.
    (2) Research involving the use of educational tests (cognitive, 
diagnostic, aptitude, achievement), survey procedures, interview 
procedures or observation of public behavior, unless:
    (i) Information obtained is recorded in such a manner that human 
subjects can be identified, directly or through identifiers linked to 
the subjects; and
    (ii) Any disclosure of the human subjects' responses outside the 
research could reasonably place the subjects at risk of criminal or 
civil liability or be damaging to the subjects' financial standing, 
employability, or reputation.
    (3) Research involving the use of educational tests (cognitive, 
diagnostic, aptitude, achievement), survey procedures, interview 
procedures, or observation of public behavior that is not exempt under 
paragraph (b)(2) of this section, if:
    (i) The human subjects are elected or appointed public officials or 
candidates for public office; or

[[Page 227]]

    (ii) Federal statute(s) require(s) without exception that the 
confidentiality of the personally identifiable information will be 
maintained throughout the research and thereafter.
    (4) Research, involving the collection or study of existing data, 
documents, records, pathological specimens, or diagnostic specimens, if 
these sources are publicly available or if the information is recorded 
by the investigator in such a manner that subjects cannot be identified, 
directly or through identifiers linked to the subjects.
    (5) Research and demonstration projects which are conducted by or 
subject to the approval of department or agency heads, and which are 
designed to study, evaluate, or otherwise examine:
    (i) Public benefit or service programs;
    (ii) Procedures for obtaining benefits or services under those 
programs;
    (iii) Possible changes in or alternatives to those programs or 
procedures; or
    (iv) Possible changes in methods or levels of payment for benefits 
or services under those programs.
    (6) Taste and food quality evaluation and consumer acceptance 
studies,
    (i) If wholesome foods without additives are consumed or
    (ii) If a food is consumed that contains a food ingredient at or 
below the level and for a use found to be safe, or agricultural chemical 
or environmental contaminant at or below the level found to be safe, by 
the Food and Drug Administration or approved by the Environmental 
Protection Agency or the Food Safety and Inspection Service of the U.S. 
Department of Agriculture.
    (c) Department or agency heads retain final judgment as to whether a 
particular activity is covered by this policy.
    (d) Department or agency heads may require that specific research 
activities or classes of research activities conducted, supported, or 
otherwise subject to regulation by the department or agency but not 
otherwise covered by this policy, comply with some or all of the 
requirements of this policy.
    (e) Compliance with this policy requires compliance with pertinent 
federal laws or regulations which provide additional protections for 
human subjects.
    (f) This policy does not affect any state or local laws or 
regulations which may otherwise be applicable and which provide 
additional protections for human subjects.
    (g) This policy does not affect any foreign laws or regulations 
which may otherwise be applicable and which provide additional 
protections to human subjects of research.
    (h) When research covered by this policy takes place in foreign 
countries, procedures normally followed in the foreign countries to 
protect human subjects may differ from those set forth in this policy. 
(An example is a foreign institution which complies with guidelines 
consistent with the World Medical Assembly Declaration (Declaration of 
Helsinki amended 1989) issued either by sovereign states or by an 
organization whose function for the protection of human research 
subjects is internationally recognized.) In these circumstances, if a 
department or agency head determines that the procedures prescribed by 
the institution afford protections that are at least equivalent to those 
provided in this policy, the department or agency head may approve the 
substitution of the foreign procedures in lieu of the procedural 
requirements provided in this policy. Except when otherwise required by 
statute, Executive Order, or the department or agency head, notices of 
these actions as they occur will be published in the Federal Register or 
will be otherwise published as provided in department or agency 
procedures.
    (i) Unless otherwise required by law, department or agency heads may 
waive the applicability of some or all of the provisions of this policy 
to specific research activities or classes of research activities 
otherwise covered by this policy. Except when otherwise required by 
statute or Executive Order, the department or agency head shall forward 
advance notices of these actions to the Office for Human Research 
Protections, Department of Health and Human Services (HHS), or any 
successor office, and shall also publish them in the Federal Register or 
in

[[Page 228]]

such other manner as provided in department or agency procedures. \1\
---------------------------------------------------------------------------

    \1\ Institutions with HHS-approved assurances on file will abide by 
provisions of title 45 CFR part 46 subparts A-D. Some of the other 
Departments and Agencies have incorporated all provisions of title 45 
CFR part 46 into their policies and procedures as well. However, the 
exemptions at 45 CFR 46.101(b) do not apply to research involving 
prisoners, subpart C. The exemption at 45 CFR 46.101(b)(2), for research 
involving survey or interview procedures or observation of public 
behavior, does not apply to research with children, subpart D, except 
for research involving observations of public behavior when the 
investigator(s) do not participate in the activities being observed.

(Authority: 5 U.S.C. 301; 20 U.S.C. 1221e-3, 3474; and 42 U.S.C. 300v-
---------------------------------------------------------------------------
1(b))

[56 FR 28012, 28021, June 18, 1991; 56 FR 29756, June 28, 1991, as 
amended at 70 FR 36328, June 23, 2005]



Sec. 97.102  Definitions.

    (a) Department or agency head means the head of any federal 
department or agency and any other officer or employee of any department 
or agency to whom authority has been delegated.
    (b) Institution means any public or private entity or agency 
(including federal, state, and other agencies).
    (c) Legally authorized representative means an individual or 
judicial or other body authorized under applicable law to consent on 
behalf of a prospective subject to the subject's participation in the 
procedure(s) involved in the research.
    (d) Research means a systematic investigation, including research 
development, testing and evaluation, designed to develop or contribute 
to generalizable knowledge. Activities which meet this definition 
constitute research for purposes of this policy, whether or not they are 
conducted or supported under a program which is considered research for 
other purposes. For example, some demonstration and service programs may 
include research activities.
    (e) Research subject to regulation, and similar terms are intended 
to encompass those research activities for which a federal department or 
agency has specific responsibility for regulating as a research 
activity, (for example, Investigational New Drug requirements 
administered by the Food and Drug Administration). It does not include 
research activities which are incidentally regulated by a federal 
department or agency solely as part of the department's or agency's 
broader responsibility to regulate certain types of activities whether 
research or non-research in nature (for example, Wage and Hour 
requirements administered by the Department of Labor).
    (f) Human subject means a living individual about whom an 
investigator (whether professional or student) conducting research 
obtains
    (1) Data through intervention or interaction with the individual, or
    (2) Identifiable private information.

Intervention includes both physical procedures by which data are 
gathered (for example, venipuncture) and manipulations of the subject or 
the subject's environment that are performed for research purposes. 
Interaction includes communication or interpersonal contact between 
investigator and subject. ``Private information'' includes information 
about behavior that occurs in a context in which an individual can 
reasonably expect that no observation or recording is taking place, and 
information which has been provided for specific purposes by an 
individual and which the individual can reasonably expect will not be 
made public (for example, a medical record). Private information must be 
individually identifiable (i.e., the identity of the subject is or may 
readily be ascertained by the investigator or associated with the 
information) in order for obtaining the information to constitute 
research involving human subjects.
    (g) IRB means an institutional review board established in accord 
with and for the purposes expressed in this policy.
    (h) IRB approval means the determination of the IRB that the 
research has been reviewed and may be conducted at an institution within 
the constraints set forth by the IRB and by other institutional and 
federal requirements.
    (i) Minimal risk means that the probability and magnitude of harm or 
discomfort anticipated in the research are not greater in and of 
themselves than

[[Page 229]]

those ordinarily encountered in daily life or during the performance of 
routine physical or psychological examinations or tests.
    (j) Certification means the official notification by the institution 
to the supporting department or agency, in accordance with the 
requirements of this policy, that a research project or activity 
involving human subjects has been reviewed and approved by an IRB in 
accordance with an approved assurance.

(Authority: 5 U.S.C. 301; 20 U.S.C. 1221e-3, 3474; and 42 U.S.C. 300v-
1(b))



Sec. 97.103  Assuring compliance with this policy--research conducted 
or supported by any Federal Department or Agency.

    (a) Each institution engaged in research which is covered by this 
policy and which is conducted or supported by a federal department or 
agency shall provide written assurance satisfactory to the department or 
agency head that it will comply with the requirements set forth in this 
policy. In lieu of requiring submission of an assurance, individual 
department or agency heads shall accept the existence of a current 
assurance, appropriate for the research in question, on file with the 
Office for Human Research Protections, HHS, or any successor office, and 
approved for federalwide use by that office. When the existence of an 
HHS-approved assurance is accepted in lieu of requiring submission of an 
assurance, reports (except certification) required by this policy to be 
made to department and agency heads shall also be made to the Office for 
Human Research Protections, (HHS), or any successor office.
    (b) Departments and agencies will conduct or support research 
covered by this policy only if the institution has an assurance approved 
as provided in this section, and only if the institution has certified 
to the department or agency head that the research has been reviewed and 
approved by an IRB provided for in the assurance, and will be subject to 
continuing review by the IRB. Assurances applicable to federally 
supported or conducted research shall at a minimum include:
    (1) A statement of principles governing the institution in the 
discharge of its responsibilities for protecting the rights and welfare 
of human subjects of research conducted at or sponsored by the 
institution, regardless of whether the research is subject to federal 
regulation. This may include an appropriate existing code, declaration, 
or statement of ethical principles, or a statement formulated by the 
institution itself. This requirement does not preempt provisions of this 
policy applicable to department- or agency-supported or regulated 
research and need not be applicable to any research exempted or waived 
under Sec. 97.101 (b) or (i).
    (2) Designation of one or more IRBs established in accordance with 
the requirements of this policy, and for which provisions are made for 
meeting space and sufficient staff to support the IRB's review and 
recordkeeping duties.
    (3) A list of IRB members identified by name; earned degrees; 
representative capacity; indications of experience such as board 
certifications, licenses, etc., sufficient to describe each member's 
chief anticipated contributions to IRB deliberations; and any employment 
or other relationship between each member and the institution; for 
example: full-time employee, part-time employee, member of governing 
panel or board, stockholder, paid or unpaid consultant. Changes in IRB 
membership shall be reported to the department or agency head, unless in 
accord with Sec. 97.103(a) of this policy, the existence of an HHS-
approved assurance is accepted. In this case, change in IRB membership 
shall be reported to the Office for Human Research Protections, HHS, or 
any successor office.
    (4) Written procedures which the IRB will follow (i) for conducting 
its initial and continuing review of research and for reporting its 
findings and actions to the investigator and the institution; (ii) for 
determining which projects require review more often than annually and 
which projects need verification from sources other than the 
investigators that no material changes have occurred since previous IRB 
review; and (iii) for ensuring prompt reporting to the IRB of proposed 
changes in a research activity, and for ensuring that such changes in 
approved research,

[[Page 230]]

during the period for which IRB approval has already been given, may not 
be initiated without IRB review and approval except when necessary to 
eliminate apparent immediate hazards to the subject.
    (5) Written procedures for ensuring prompt reporting to the IRB, 
appropriate institutional officials, and the department or agency head 
of (i) any unanticipated problems involving risks to subjects or others 
or any serious or continuing noncompliance with this policy or the 
requirements or determinations of the IRB and (ii) any suspension or 
termination of IRB approval.
    (c) The assurance shall be executed by an individual authorized to 
act for the institution and to assume on behalf of the institution the 
obligations imposed by this policy and shall be filed in such form and 
manner as the department or agency head prescribes.
    (d) The department or agency head will evaluate all assurances 
submitted in accordance with this policy through such officers and 
employees of the department or agency and such experts or consultants 
engaged for this purpose as the department or agency head determines to 
be appropriate. The department or agency head's evaluation will take 
into consideration the adequacy of the proposed IRB in light of the 
anticipated scope of the institution's research activities and the types 
of subject populations likely to be involved, the appropriateness of the 
proposed initial and continuing review procedures in light of the 
probable risks, and the size and complexity of the institution.
    (e) On the basis of this evaluation, the department or agency head 
may approve or disapprove the assurance, or enter into negotiations to 
develop an approvable one. The department or agency head may limit the 
period during which any particular approved assurance or class of 
approved assurances shall remain effective or otherwise condition or 
restrict approval.
    (f) Certification is required when the research is supported by a 
federal department or agency and not otherwise exempted or waived under 
Sec. 97.101 (b) or (i). An institution with an approved assurance shall 
certify that each application or proposal for research covered by the 
assurance and by Sec. 97.103 of this Policy has been reviewed and 
approved by the IRB. Such certification must be submitted with the 
application or proposal or by such later date as may be prescribed by 
the department or agency to which the application or proposal is 
submitted. Under no condition shall research covered by Sec. 97.103 of 
the Policy be supported prior to receipt of the certification that the 
research has been reviewed and approved by the IRB. Institutions without 
an approved assurance covering the research shall certify within 30 days 
after receipt of a request for such a certification from the department 
or agency, that the application or proposal has been approved by the 
IRB. If the certification is not submitted within these time limits, the 
application or proposal may be returned to the institution.

(Approved by the Office of Management and Budget under Control Number 
0990-0260)

(Authority: 5 U.S.C. 301; 20 U.S.C. 1221e-3, 3474; and 42 U.S.C. 300v-
1(b))

[56 FR 28012, 28021, June 18, 1991; 56 FR 29756, June 28, 1991, as 
amended at 70 FR 36328, June 23, 2005]



Secs. 97.104-97.106  [Reserved]



Sec. 97.107  IRB membership.

    (a) Each IRB shall have at least five members, with varying 
backgrounds to promote complete and adequate review of research 
activities commonly conducted by the institution. The IRB shall be 
sufficiently qualified through the experience and expertise of its 
members, and the diversity of the members, including consideration of 
race, gender, and cultural backgrounds and sensitivity to such issues as 
community attitudes, to promote respect for its advice and counsel in 
safeguarding the rights and welfare of human subjects. In addition to 
possessing the professional competence necessary to review specific 
research activities, the IRB shall be able to ascertain the 
acceptability of proposed research in terms of institutional commitments 
and regulations, applicable law, and standards of professional conduct 
and practice. The IRB shall therefore include persons knowledgeable in 
these areas. If an IRB regularly reviews research that involves a 
vulnerable

[[Page 231]]

category of subjects, such as children, prisoners, pregnant women, or 
handicapped or mentally disabled persons, consideration shall be given 
to the inclusion of one or more individuals who are knowledgeable about 
and experienced in working with these subjects.
    (b) Every nondiscriminatory effort will be made to ensure that no 
IRB consists entirely of men or entirely of women, including the 
institution's consideration of qualified persons of both sexes, so long 
as no selection is made to the IRB on the basis of gender. No IRB may 
consist entirely of members of one profession.
    (c) Each IRB shall include at least one member whose primary 
concerns are in scientific areas and at least one member whose primary 
concerns are in nonscientific areas.
    (d) Each IRB shall include at least one member who is not otherwise 
affiliated with the institution and who is not part of the immediate 
family of a person who is affiliated with the institution.
    (e) No IRB may have a member participate in the IRB's initial or 
continuing review of any project in which the member has a conflicting 
interest, except to provide information requested by the IRB.
    (f) An IRB may, in its discretion, invite individuals with 
competence in special areas to assist in the review of issues which 
require expertise beyond or in addition to that available on the IRB. 
These individuals may not vote with the IRB.

(Authority: 5 U.S.C. 301; 20 U.S.C. 1221e-3, 3474; and 42 U.S.C. 300v-
1(b))



Sec. 97.108  IRB functions and operations.

    In order to fulfill the requirements of this policy each IRB shall:
    (a) Follow written procedures in the same detail as described in 
Sec. 97.103(b)(4) and, to the extent required by, Sec. 97.103(b)(5).
    (b) Except when an expedited review procedure is used (see 
Sec. 97.110), review proposed research at convened meetings at which a 
majority of the members of the IRB are present, including at least one 
member whose primary concerns are in nonscientific areas. In order for 
the research to be approved, it shall receive the approval of a majority 
of those members present at the meeting.

(Authority: 5 U.S.C. 301; 20 U.S.C. 1221e-3, 3474; and 42 U.S.C. 300v-
1(b))



Sec. 97.109  IRB review of research.

    (a) An IRB shall review and have authority to approve, require 
modifications in (to secure approval), or disapprove all research 
activities covered by this policy.
    (b) An IRB shall require that information given to subjects as part 
of informed consent is in accordance with Sec. 97.116. The IRB may 
require that information, in addition to that specifically mentioned in 
Sec. 97.116, be given to the subjects when in the IRB's judgment the 
information would meaningfully add to the protection of the rights and 
welfare of subjects.
    (c) An IRB shall require documentation of informed consent or may 
waive documentation in accordance with Sec. 97.117.
    (d) An IRB shall notify investigators and the institution in writing 
of its decision to approve or disapprove the proposed research activity, 
or of modifications required to secure IRB approval of the research 
activity. If the IRB decides to disapprove a research activity, it shall 
include in its written notification a statement of the reasons for its 
decision and give the investigator an opportunity to respond in person 
or in writing.
    (e) An IRB shall conduct continuing review of research covered by 
this policy at intervals appropriate to the degree of risk, but not less 
than once per year, and shall have authority to observe or have a third 
party observe the consent process and the research.

(Approved by the Office of Management and Budget under Control Number 
0990-0260)

(Authority: 5 U.S.C. 301; 20 U.S.C. 1221e-3, 3474; and 42 U.S.C. 300v-
1(b))

[56 FR 28012, 28021, June 18, 1991, as amended at 70 FR 36328, June 23, 
2005]



Sec. 97.110  Expedited review procedures for certain kinds of research 
involving no more than minimal risk, and for minor changes in approved
research.

    (a) The Secretary, HHS, has established, and published as a Notice 
in the

[[Page 232]]

Federal Register, a list of categories of research that may be reviewed 
by the IRB through an expedited review procedure. The list will be 
amended, as appropriate after consultation with other departments and 
agencies, through periodic republication by the Secretary, HHS, in the 
Federal Register. A copy of the list is available from the Office for 
Human Research Protections, HHS, or any successor office.
    (b) An IRB may use the expedited review procedure to review either 
or both of the following:
    (1) Some or all of the research appearing on the list and found by 
the reviewer(s) to involve no more than minimal risk,
    (2) Minor changes in previously approved research during the period 
(of one year or less) for which approval is authorized.

Under an expedited review procedure, the review may be carried out by 
the IRB chairperson or by one or more experienced reviewers designated 
by the chairperson from among members of the IRB. In reviewing the 
research, the reviewers may exercise all of the authorities of the IRB 
except that the reviewers may not disapprove the research. A research 
activity may be disapproved only after review in accordance with the 
non-expedited procedure set forth in Sec. 97.108(b).
    (c) Each IRB which uses an expedited review procedure shall adopt a 
method for keeping all members advised of research proposals which have 
been approved under the procedure.
    (d) The department or agency head may restrict, suspend, terminate, 
or choose not to authorize an institution's or IRB's use of the 
expedited review procedure.

(Authority: 5 U.S.C. 301; 20 U.S.C. 1221e-3, 3474; and 42 U.S.C. 300v-
1(b))

[56 FR 28012, 28021, June 18, 1991, as amended at 70 FR 36328, June 23, 
2005]



Sec. 97.111  Criteria for IRB approval of research.

    (a) In order to approve research covered by this policy the IRB 
shall determine that all of the following requirements are satisfied:
    (1) Risks to subjects are minimized:
    (i) By using procedures which are consistent with sound research 
design and which do not unnecessarily expose subjects to risk, and
    (ii) Whenever appropriate, by using procedures already being 
performed on the subjects for diagnostic or treatment purposes.
    (2) Risks to subjects are reasonable in relation to anticipated 
benefits, if any, to subjects, and the importance of the knowledge that 
may reasonably be expected to result. In evaluating risks and benefits, 
the IRB should consider only those risks and benefits that may result 
from the research (as distinguished from risks and benefits of therapies 
subjects would receive even if not participating in the research). The 
IRB should not consider possible long-range effects of applying 
knowledge gained in the research (for example, the possible effects of 
the research on public policy) as among those research risks that fall 
within the purview of its responsibility.
    (3) Selection of subjects is equitable. In making this assessment 
the IRB should take into account the purposes of the research and the 
setting in which the research will be conducted and should be 
particularly cognizant of the special problems of research involving 
vulnerable populations, such as children, prisoners, pregnant women, 
mentally disabled persons, or economically or educationally 
disadvantaged persons.
    (4) Informed consent will be sought from each prospective subject or 
the subject's legally authorized representative, in accordance with, and 
to the extent required by Sec. 97.116.
    (5) Informed consent will be appropriately documented, in accordance 
with, and to the extent required by Sec. 97.117.
    (6) When appropriate, the research plan makes adequate provision for 
monitoring the data collected to ensure the safety of subjects.
    (7) When appropriate, there are adequate provisions to protect the 
privacy of subjects and to maintain the confidentiality of data.
    (b) When some or all of the subjects are likely to be vulnerable to 
coercion or undue influence, such as children, prisoners, pregnant 
women, mentally

[[Page 233]]

disabled persons, or economically or educationally disadvantaged 
persons, additional safeguards have been included in the study to 
protect the rights and welfare of these subjects.

(Authority: 5 U.S.C. 301; 20 U.S.C. 1221e-3, 3474; and 42 U.S.C. 300v-
1(b))



Sec. 97.112  Review by institution.

    Research covered by this policy that has been approved by an IRB may 
be subject to further appropriate review and approval or disapproval by 
officials of the institution. However, those officials may not approve 
the research if it has not been approved by an IRB.

(Authority: 5 U.S.C. 301; 20 U.S.C. 1221e-3, 3474; and 42 U.S.C. 300v-
1(b))



Sec. 97.113  Suspension or termination of IRB approval of research.

    An IRB shall have authority to suspend or terminate approval of 
research that is not being conducted in accordance with the IRB's 
requirements or that has been associated with unexpected serious harm to 
subjects. Any suspension or termination of approval shall include a 
statement of the reasons for the IRB's action and shall be reported 
promptly to the investigator, appropriate institutional officials, and 
the department or agency head.

(Approved by the Office of Management and Budget under Control Number 
0990-0260)

(Authority: 5 U.S.C. 301; 20 U.S.C. 1221e-3, 3474; and 42 U.S.C. 300v-
1(b))

[56 FR 28012, 28021, June 18, 1991, as amended at 70 FR 36328, June 23, 
2005]



Sec. 97.114  Cooperative research.

    Cooperative research projects are those projects covered by this 
policy which involve more than one institution. In the conduct of 
cooperative research projects, each institution is responsible for 
safeguarding the rights and welfare of human subjects and for complying 
with this policy. With the approval of the department or agency head, an 
institution participating in a cooperative project may enter into a 
joint review arrangement, rely upon the review of another qualified IRB, 
or make similar arrangements for avoiding duplication of effort.

(Authority: 5 U.S.C. 301; 20 U.S.C. 1221e-3, 3474; and 42 U.S.C. 300v-
1(b))



Sec. 97.115  IRB records.

    (a) An institution, or when appropriate an IRB, shall prepare and 
maintain adequate documentation of IRB activities, including the 
following:
    (1) Copies of all research proposals reviewed, scientific 
evaluations, if any, that accompany the proposals, approved sample 
consent documents, progress reports submitted by investigators, and 
reports of injuries to subjects.
    (2) Minutes of IRB meetings which shall be in sufficient detail to 
show attendance at the meetings; actions taken by the IRB; the vote on 
these actions including the number of members voting for, against, and 
abstaining; the basis for requiring changes in or disapproving research; 
and a written summary of the discussion of controverted issues and their 
resolution.
    (3) Records of continuing review activities.
    (4) Copies of all correspondence between the IRB and the 
investigators.
    (5) A list of IRB members in the same detail as described is 
Sec. 97.103(b)(3).
    (6) Written procedures for the IRB in the same detail as described 
in Sec. 97.103(b)(4) and Sec. 97.103(b)(5).
    (7) Statements of significant new findings provided to subjects, as 
required by Sec. 97.116(b)(5).
    (b) The records required by this policy shall be retained for at 
least 3 years, and records relating to research which is conducted shall 
be retained for at least 3 years after completion of the research. All 
records shall be accessible for inspection and copying by authorized 
representatives of the department or agency at reasonable times and in a 
reasonable manner.

(Approved by the Office of Management and Budget under Control Number 
0990-0260)

(Authority: 5 U.S.C. 301; 20 U.S.C. 1221e-3, 3474; and 42 U.S.C. 300v-
1(b))

[56 FR 28012, 28021, June 18, 1991, as amended at 70 FR 36328, June 23, 
2005]

[[Page 234]]



Sec. 97.116  General requirements for informed consent.

    Except as provided elsewhere in this policy, no investigator may 
involve a human being as a subject in research covered by this policy 
unless the investigator has obtained the legally effective informed 
consent of the subject or the subject's legally authorized 
representative. An investigator shall seek such consent only under 
circumstances that provide the prospective subject or the representative 
sufficient opportunity to consider whether or not to participate and 
that minimize the possibility of coercion or undue influence. The 
information that is given to the subject or the representative shall be 
in language understandable to the subject or the representative. No 
informed consent, whether oral or written, may include any exculpatory 
language through which the subject or the representative is made to 
waive or appear to waive any of the subject's legal rights, or releases 
or appears to release the investigator, the sponsor, the institution or 
its agents from liability for negligence.
    (a) Basic elements of informed consent. Except as provided in 
paragraph (c) or (d) of this section, in seeking informed consent the 
following information shall be provided to each subject:
    (1) A statement that the study involves research, an explanation of 
the purposes of the research and the expected duration of the subject's 
participation, a description of the procedures to be followed, and 
identification of any procedures which are experimental;
    (2) A description of any reasonably foreseeable risks or discomforts 
to the subject;
    (3) A description of any benefits to the subject or to others which 
may reasonably be expected from the research;
    (4) A disclosure of appropriate alternative procedures or courses of 
treatment, if any, that might be advantageous to the subject;
    (5) A statement describing the extent, if any, to which 
confidentiality of records identifying the subject will be maintained;
    (6) For research involving more than minimal risk, an explanation as 
to whether any compensation and an explanation as to whether any medical 
treatments are available if injury occurs and, if so, what they consist 
of, or where further information may be obtained;
    (7) An explanation of whom to contact for answers to pertinent 
questions about the research and research subjects' rights, and whom to 
contact in the event of a research-related injury to the subject; and
    (8) A statement that participation is voluntary, refusal to 
participate will involve no penalty or loss of benefits to which the 
subject is otherwise entitled, and the subject may discontinue 
participation at any time without penalty or loss of benefits to which 
the subject is otherwise entitled.
    (b) Additional elements of informed consent. When appropriate, one 
or more of the following elements of information shall also be provided 
to each subject:
    (1) A statement that the particular treatment or procedure may 
involve risks to the subject (or to the embryo or fetus, if the subject 
is or may become pregnant) which are currently unforeseeable;
    (2) Anticipated circumstances under which the subject's 
participation may be terminated by the investigator without regard to 
the subject's consent;
    (3) Any additional costs to the subject that may result from 
participation in the research;
    (4) The consequences of a subject's decision to withdraw from the 
research and procedures for orderly termination of participation by the 
subject;
    (5) A statement that significant new findings developed during the 
course of the research which may relate to the subject's willingness to 
continue participation will be provided to the subject; and
    (6) The approximate number of subjects involved in the study.
    (c) An IRB may approve a consent procedure which does not include, 
or which alters, some or all of the elements of informed consent set 
forth above, or waive the requirement to obtain informed consent 
provided the IRB finds and documents that:
    (1) The research or demonstration project is to be conducted by or 
subject

[[Page 235]]

to the approval of state or local government officials and is designed 
to study, evaluate, or otherwise examine:
    (i) Public benefit of service programs;
    (ii) Procedures for obtaining benefits or services under those 
programs;
    (iii) Possible changes in or alternatives to those programs or 
procedures; or
    (iv) Possible changes in methods or levels of payment for benefits 
or services under those programs; and
    (2) The research could not practicably be carried out without the 
waiver or alteration.
    (d) An IRB may approve a consent procedure which does not include, 
or which alters, some or all of the elements of informed consent set 
forth in this section, or waive the requirements to obtain informed 
consent provided the IRB finds and documents that:
    (1) The research involves no more than minimal risk to the subjects;
    (2) The waiver or alteration will not adversely affect the rights 
and welfare of the subjects;
    (3) The research could not practicably be carried out without the 
waiver or alteration; and
    (4) Whenever appropriate, the subjects will be provided with 
additional pertinent information after participation.
    (e) The informed consent requirements in this policy are not 
intended to preempt any applicable federal, state, or local laws which 
require additional information to be disclosed in order for informed 
consent to be legally effective.
    (f) Nothing in this policy is intended to limit the authority of a 
physician to provide emergency medical care, to the extent the physician 
is permitted to do so under applicable federal, state, or local law.

(Approved by the Office of Management and Budget under Control Number 
0990-0260)

(Authority: 5 U.S.C. 301; 20 U.S.C. 1221e-3, 3474; and 42 U.S.C. 300v-
1(b))

[56 FR 28012, 28021, June 18, 1991, as amended at 70 FR 36328, June 23, 
2005]



Sec. 97.117  Documentation of informed consent.

    (a) Except as provided in paragraph (c) of this section, informed 
consent shall be documented by the use of a written consent form 
approved by the IRB and signed by the subject or the subject's legally 
authorized representative. A copy shall be given to the person signing 
the form.
    (b) Except as provided in paragraph (c) of this section, the consent 
form may be either of the following:
    (1) A written consent document that embodies the elements of 
informed consent required by Sec. 97.116. This form may be read to the 
subject or the subject's legally authorized representative, but in any 
event, the investigator shall give either the subject or the 
representative adequate opportunity to read it before it is signed; or
    (2) A short form written consent document stating that the elements 
of informed consent required by Sec. 97.116 have been presented orally 
to the subject or the subject's legally authorized representative. When 
this method is used, there shall be a witness to the oral presentation. 
Also, the IRB shall approve a written summary of what is to be said to 
the subject or the representative. Only the short form itself is to be 
signed by the subject or the representative. However, the witness shall 
sign both the short form and a copy of the summary, and the person 
actually obtaining consent shall sign a copy of the summary. A copy of 
the summary shall be given to the subject or the representative, in 
addition to a copy of the short form.
    (c) An IRB may waive the requirement for the investigator to obtain 
a signed consent form for some or all subjects if it finds either:
    (1) That the only record linking the subject and the research would 
be the consent document and the principal risk would be potential harm 
resulting from a breach of confidentiality. Each subject will be asked 
whether the subject wants documentation linking the subject with the 
research, and the subject's wishes will govern; or
    (2) That the research presents no more than minimal risk of harm to 
subjects and involves no procedures for which written consent is 
normally required outside of the research context.

[[Page 236]]


In cases in which the documentation requirement is waived, the IRB may 
require the investigator to provide subjects with a written statement 
regarding the research.

(Approved by the Office of Management and Budget under Control Number 
0990-0260)

(Authority: 5 U.S.C. 301; 20 U.S.C. 1221e-3, 3474; and 42 U.S.C. 300v-
1(b))

[56 FR 28012, 28021, June 18, 1991, as amended at 70 FR 36328, June 23, 
2005]



Sec. 97.118  Applications and proposals lacking definite plans for
involvement of human subjects.

    Certain types of applications for grants, cooperative agreements, or 
contracts are submitted to departments or agencies with the knowledge 
that subjects may be involved within the period of support, but definite 
plans would not normally be set forth in the application or proposal. 
These include activities such as institutional type grants when 
selection of specific projects is the institution's responsibility; 
research training grants in which the activities involving subjects 
remain to be selected; and projects in which human subject's involvement 
will depend upon completion of instruments, prior animal studies, or 
purification of compounds. These applications need not be reviewed by an 
IRB before an award may be made. However, except for research exempted 
or waived under Sec. 97.101 (b) or (i), no human subjects may be 
involved in any project supported by these awards until the project has 
been reviewed and approved by the IRB, as provided in this policy, and 
certification submitted, by the institution, to the department or 
agency.

(Authority: 5 U.S.C. 301; 20 U.S.C. 1221e-3, 3474; and 42 U.S.C. 300v-
1(b))



Sec. 97.119  Research undertaken without the intention of involving
human subjects.

    In the event research is undertaken without the intention of 
involving human subjects, but it is later proposed to involve human 
subjects in the research, the research shall first be reviewed and 
approved by an IRB, as provided in this policy, a certification 
submitted, by the institution, to the department or agency, and final 
approval given to the proposed change by the department or agency.

(Authority: 5 U.S.C. 301; 20 U.S.C. 1221e-3, 3474; and 42 U.S.C. 300v-
1(b))



Sec. 97.120  Evaluation and disposition of applications and proposals
for research to be conducted or supported by a Federal Department
or Agency.

    (a) The department or agency head will evaluate all applications and 
proposals involving human subjects submitted to the department or agency 
through such officers and employees of the department or agency and such 
experts and consultants as the department or agency head determines to 
be appropriate. This evaluation will take into consideration the risks 
to the subjects, the adequacy of protection against these risks, the 
potential benefits of the research to the subjects and others, and the 
importance of the knowledge gained or to be gained.
    (b) On the basis of this evaluation, the department or agency head 
may approve or disapprove the application or proposal, or enter into 
negotiations to develop an approvable one.

(Authority: 5 U.S.C. 301; 20 U.S.C. 1221e-3, 3474; and 42 U.S.C. 300v-
1(b))



Sec. 97.121  [Reserved]



Sec. 97.122  Use of Federal funds.

    Federal funds administered by a department or agency may not be 
expended for research involving human subjects unless the requirements 
of this policy have been satisfied.

(Authority: 5 U.S.C. 301; 20 U.S.C. 1221e-3, 3474; and 42 U.S.C. 300v-
1(b))



Sec. 97.123  Early termination of research support: Evaluation of
applications and proposals.

    (a) The department or agency head may require that department or 
agency support for any project be terminated or suspended in the manner 
prescribed in applicable program requirements, when the department or 
agency head finds an institution has materially failed to comply with 
the terms of this policy.
    (b) In making decisions about supporting or approving applications 
or

[[Page 237]]

proposals covered by this policy the department or agency head may take 
into account, in addition to all other eligibility requirements and 
program criteria, factors such as whether the applicant has been subject 
to a termination or suspension under paragarph (a) of this section and 
whether the applicant or the person or persons who would direct or has 
have directed the scientific and technical aspects of an activity has 
have, in the judgment of the department or agency head, materially 
failed to discharge responsibility for the protection of the rights and 
welfare of human subjects (whether or not the research was subject to 
federal regulation).

(Authority: 5 U.S.C. 301; 20 U.S.C. 1221e-3, 3474; and 42 U.S.C. 300v-
1(b))



Sec. 97.124  Conditions.

    With respect to any research project or any class of research 
projects the department or agency head may impose additional conditions 
prior to or at the time of approval when in the judgment of the 
department or agency head additional conditions are necessary for the 
protection of human subjects.

(Authority: 5 U.S.C. 301; 20 U.S.C. 1221e-3, 3474; and 42 U.S.C. 300v-
1(b))

Subparts B-C [Reserved]



  Subpart D_Additional ED Protections for Children Who Are Subjects in 
                                Research

    Source: 62 FR 63221, Nov. 26, 1997, unless otherwise noted.



Sec. 97.401  To what do these regulations apply?

    (a) This subpart applies to all research involving children as 
subjects conducted or supported by the Department of Education.
    (1) This subpart applies to research conducted by Department 
employees.
    (2) This subpart applies to research conducted or supported by the 
Department of Education outside the United States, but in appropriate 
circumstances the Secretary may, under Sec. 97.101(i), waive the 
applicability of some or all of the requirements of the regulations in 
this subpart for that research.
    (b) Exemptions in Sec. 97.101(b)(1) and (b)(3) through (b)(6) are 
applicable to this subpart. The exemption in Sec. 97.101(b)(2) regarding 
educational tests is also applicable to this subpart. The exemption in 
Sec. 97.101(b)(2) for research involving survey or interview procedures 
or observations of public behavior does not apply to research covered by 
this subpart, except for research involving observation of public 
behavior when the investigator or investigators do not participate in 
the activities being observed.
    (c) The exceptions, additions, and provisions for waiver as they 
appear in Sec. 97.101(c) through (i) are applicable to this subpart.

(Authority: 5 U.S.C. 301; 20 U.S.C. 1221e-3, 3474; and 42 U.S.C. 300v-
1(b)).



Sec. 97.402  Definitions.

    The definitions in Sec. 97.102 apply to this subpart. In addition, 
the following definitions also apply to this subpart:
    (a) Children are persons who have not attained the legal age for 
consent to treatments or procedures involved in the research, under the 
applicable law of the jurisdiction in which the research will be 
conducted.
    (b) Assent means a child's affirmative agreement to participate in 
research. Mere failure to object should not, absent affirmative 
agreement, be construed as assent.
    (c) Permission means the agreement of parent(s) or guardian to the 
participation of their child or ward in research.
    (d) Parent means a child's biological or adoptive parent.
    (e) Guardian means an individual who is authorized under applicable 
State or local law to consent on behalf of a child to general medical 
care.

(Authority: 5 U.S.C. 301; 20 U.S.C. 1221e-3, 3474; and 42 U.S.C. 300v-
1(b)).



Sec. 97.403  IRB duties.

    In addition to other responsibilities assigned to IRBs under this 
part, each IRB shall review research covered by this subpart and approve 
only research

[[Page 238]]

that satisfies the conditions of all applicable sections of this 
subpart.

(Authority: 5 U.S.C. 301; 20 U.S.C. 1221e-3, 3474; and 42 U.S.C. 300v-
1(b)).



Sec. 97.404  Research not involving greater than minimal risk.

    ED conducts or funds research in which the IRB finds that no greater 
than minimal risk to children is presented, only if the IRB finds that 
adequate provisions are made for soliciting the assent of the children 
and the permission of their parents or guardians, as set forth in 
Sec. 97.408.

(Authority: 5 U.S.C. 301; 20 U.S.C. 1221e-3, 3474; and 42 U.S.C. 300v-
1(b))



Sec. 97.405  Research involving greater than minimal risk but 
presenting the prospect of direct benefit to the individual subjects.

    ED conducts or funds research in which the IRB finds that more than 
minimal risk to children is presented by an intervention or procedure 
that holds out the prospect of direct benefit for the individual 
subject, or by a monitoring procedure that is likely to contribute to 
the subject's well-being, only if the IRB finds that--
    (a) The risk is justified by the anticipated benefit to the 
subjects;
    (b) The relation of the anticipated benefit to the risk is at least 
as favorable to the subjects as that presented by available alternative 
approaches; and
    (c) Adequate provisions are made for soliciting the assent of the 
children and permission of their parents or guardians, as set forth in 
Sec. 97.408.

(Authority: 5 U.S.C. 301; 20 U.S.C. 1221e-3, 3474; and 42 U.S.C. 300v-
1(b))



Sec. 97.406  Research involving greater than minimal risk and no
prospect of direct benefit to individual subjects, but likely to 
yield generalizable knowledge about the subject's disorder or condition.

    ED conducts or funds research in which the IRB finds that more than 
minimal risk to children is presented by an intervention or procedure 
that does not hold out the prospect of direct benefit for the individual 
subject, or by a monitoring procedure which is not likely to contribute 
to the well-being of the subject, only if the IRB finds that--
    (a) The risk represents a minor increase over minimal risk;
    (b) The intervention or procedure presents experiences to subjects 
that are reasonably commensurate with those inherent in their actual or 
expected medical, dental, psychological, social, or educational 
situations;
    (c) The intervention or procedure is likely to yield generalizable 
knowledge about the subjects' disorder or condition that is of vital 
importance for the understanding or amelioration of the subjects' 
disorder or condition; and
    (d) Adequate provisions are made for soliciting assent of the 
children and permission of their parents or guardians, as set forth in 
Sec. 97.408.

(Authority: 5 U.S.C. 301; 20 U.S.C. 1221e-3, 3474; and 42 U.S.C. 300v-
1(b))



Sec. 97.407  Research not otherwise approvable which presents an 
opportunity to understand, prevent, or alleviate a serious problem
affecting the health or welfare of children.

    ED conducts or funds research that the IRB does not believe meets 
the requirements of Sec. 97.404, Sec. 97.405, or Sec. 97.406 only if--
    (a) The IRB finds that the research presents a reasonable 
opportunity to further the understanding, prevention, or alleviation of 
a serious problem affecting the health or welfare of children; and
    (b) The Secretary, after consultation with a panel of experts in 
pertinent disciplines (for example: science, medicine, education, 
ethics, law) and following opportunity for public review and comment, 
has determined either that--
    (1) The research in fact satisfies the conditions of Sec. 97.404, 
Sec. 97.405, or Sec. 97.406, as applicable; or
    (2)(i) The research presents a reasonable opportunity to further the 
understanding, prevention, or alleviation of a serious problem affecting 
the health or welfare of children;
    (ii) The research will be conducted in accordance with sound ethical 
principles; and
    (iii) Adequate provisions are made for soliciting the assent of 
children and

[[Page 239]]

the permission of their parents or guardians, as set forth in 
Sec. 97.408.

(Authority: 5 U.S.C. 301; 20 U.S.C. 1221e-3, 3474; and 42 U.S.C. 300v-
1(b))



Sec. 97.408  Requirements for permission by parents or guardians 
and for assent by children.

    (a) In addition to the determinations required under other 
applicable sections of this subpart, the IRB shall determine that 
adequate provisions are made for soliciting the assent of the children, 
if in the judgment of the IRB the children are capable of providing 
assent. In determining whether children are capable of assenting, the 
IRB shall take into account the ages, maturity, and psychological state 
of the children involved. This judgment may be made for all children to 
be involved in research under a particular protocol, or for each child, 
as the IRB deems appropriate. If the IRB determines that the capability 
of some or all of the children is so limited that they cannot reasonably 
be consulted or that the intervention or procedure involved in the 
research holds out a prospect of direct benefit that is important to the 
health or well-being of the children and is available only in the 
context of the research, the assent of the children is not a necessary 
condition for proceeding with the research. Even if the IRB determines 
that the subjects are capable of assenting, the IRB may still waive the 
assent requirement under circumstances in which consent may be waived in 
accord with Sec. 97.116.
    (b) In addition to the determinations required under other 
applicable sections of this subpart, the IRB shall determine, in 
accordance with and to the extent that consent is required by 
Sec. 97.116, that adequate provisions are made for soliciting the 
permission of each child's parent(s) or guardian(s). If parental 
permission is to be obtained, the IRB may find that the permission of 
one parent is sufficient for research to be conducted under Sec. 97.404 
or Sec. 97.405. If research is covered by Secs. 97.406 and 97.407 and 
permission is to be obtained from parents, both parents must give their 
permission unless one parent is deceased, unknown, incompetent, or not 
reasonably available, or if only one parent has legal responsibility for 
the care and custody of the child.
    (c) In addition to the provisions for waiver contained in 
Sec. 97.116, if the IRB determines that a research protocol is designed 
for conditions or for a subject population for which parental or 
guardian permission is not a reasonable requirement to protect the 
subjects (for example, neglected or abused children), it may waive the 
consent requirements in subpart A of this part and paragraph (b) of this 
section, provided an appropriate mechanism for protecting the children 
who will participate as subjects in the research is substituted, and 
provided further that the waiver is not inconsistent with Federal, 
State, or local law. The choice of an appropriate mechanism depends upon 
the nature and purpose of the activities described in the protocol, the 
risk and anticipated benefit to the research subjects, and their age, 
maturity, status, and condition.
    (d) Permission by parents or guardians must be documented in 
accordance with and to the extent required by Sec. 97.117.
    (e) If the IRB determines that assent is required, it shall also 
determine whether and how assent must be documented.

(Authority: 5 U.S.C. 301; 20 U.S.C. 1221e-3, 3474; and 42 U.S.C. 300v-
1(b))



Sec. 97.409  Wards.

    (a) Children who are wards of the State or any other agency, 
institution, or entity may be included in research approved under 
Sec. 97.406 or Sec. 97.407 only if that research is--
    (1) Related to their status as wards; or
    (2) Conducted in schools, camps, hospitals, institutions, or similar 
settings in which the majority of children involved as subjects are not 
wards.
    (b) If research is approved under paragraph (a) of this section, the 
IRB shall require appointment of an advocate for each child who is a 
ward, in addition to any other individual acting on behalf of the child 
as guardian or in loco parentis. One individual may serve as advocate 
for more than one child. The advocate must be an individual who has the 
background and experience to act in, and agrees to act in, the best

[[Page 240]]

interest of the child for the duration of the child's participation in 
the research and who is not associated in any way (except in the role as 
advocate or member of the IRB) with the research, the investigator or 
investigators, or the guardian organization.

(Authority: 5 U.S.C. 301; 20 U.S.C. 1221e-3, 3474; and 42 U.S.C. 300v-
1(b))

    Effective Date Note: At 82 FR 7272, Jan. 19, 2017, part 97, subpart 
A was revised, effective Jan. 19, 2018. For the convenience of the user, 
the revised text is set forth as follows:



Subpart A_Federal Policy for the Protection of Human Subjects (Basic ED 
            Policy for Protection of Human Research Subjects)



Sec. 97.101  To what does this policy apply?

    (a) Except as detailed in Sec. 97.104, this policy applies to all 
research involving human subjects conducted, supported, or otherwise 
subject to regulation by any Federal department or agency that takes 
appropriate administrative action to make the policy applicable to such 
research. This includes research conducted by Federal civilian employees 
or military personnel, except that each department or agency head may 
adopt such procedural modifications as may be appropriate from an 
administrative standpoint. It also includes research conducted, 
supported, or otherwise subject to regulation by the Federal Government 
outside the United States. Institutions that are engaged in research 
described in this paragraph and institutional review boards (IRBs) 
reviewing research that is subject to this policy must comply with this 
policy.
    (b) [Reserved]
    (c) Department or agency heads retain final judgment as to whether a 
particular activity is covered by this policy and this judgment shall be 
exercised consistent with the ethical principles of the Belmont 
Report.\62\
---------------------------------------------------------------------------

    \62\ The National Commission for the Protection of Human Subjects of 
Biomedical and Behavioral Research.- Belmont Report. Washington, DC: 
U.S. Department of Health and Human Services. 1979.
---------------------------------------------------------------------------

    (d) Department or agency heads may require that specific research 
activities or classes of research activities conducted, supported, or 
otherwise subject to regulation by the Federal department or agency but 
not otherwise covered by this policy comply with some or all of the 
requirements of this policy.
    (e) Compliance with this policy requires compliance with pertinent 
federal laws or regulations that provide additional protections for 
human subjects.
    (f) This policy does not affect any state or local laws or 
regulations (including tribal law passed by the official governing body 
of an American Indian or Alaska Native tribe) that may otherwise be 
applicable and that provide additional protections for human subjects.
    (g) This policy does not affect any foreign laws or regulations that 
may otherwise be applicable and that provide additional protections to 
human subjects of research.
    (h) When research covered by this policy takes place in foreign 
countries, procedures normally followed in the foreign countries to 
protect human subjects may differ from those set forth in this policy. 
In these circumstances, if a department or agency head determines that 
the procedures prescribed by the institution afford protections that are 
at least equivalent to those provided in this policy, the department or 
agency head may approve the substitution of the foreign procedures in 
lieu of the procedural requirements provided in this policy. Except when 
otherwise required by statute, Executive Order, or the department or 
agency head, notices of these actions as they occur will be published in 
the Federal Register or will be otherwise published as provided in 
department or agency procedures.
    (i) Unless otherwise required by law, department or agency heads may 
waive the applicability of some or all of the provisions of this policy 
to specific research activities or classes of research activities 
otherwise covered by this policy, provided the alternative procedures to 
be followed are consistent with the principles of the Belmont 
Report.\63\ Except when otherwise required by statute or Executive 
Order, the department or agency head shall forward advance notices of 
these actions to the Office for Human Research Protections, Department 
of Health and Human Services (HHS), or any successor office, or to the 
equivalent office within the appropriate Federal department or agency, 
and shall also publish them in the Federal Register or in such other 
manner as provided in department or agency procedures. The waiver notice 
must include a statement that identifies the conditions under which the 
waiver will be applied and a justification as to why the waiver is 
appropriate for the research, including how the decision is consistent 
with the principles of the Belmont Report.
---------------------------------------------------------------------------

    \63\ Id.
---------------------------------------------------------------------------

    (j) Federal guidance on the requirements of this policy shall be 
issued only after consultation, for the purpose of harmonization (to the 
extent appropriate), with other Federal departments and agencies that 
have adopted this policy, unless such consultation is not feasible.
    (k) [Reserved]

[[Page 241]]

    (l) Compliance dates and transition provisions:
    (1) For purposes of this section, the pre-2018 Requirements means 
this subpart as published in the 2016 edition of the Code of Federal 
Regulations.
    (2) For purposes of this section, the 2018 Requirements means the 
Federal Policy for the Protection of Human Subjects requirements 
contained in this subpart. The compliance date for Sec. 97.114(b) 
(cooperative research) of the 2018 Requirements is January 20, 2020.
    (3) Research initially approved by an IRB, for which such review was 
waived pursuant to Sec. 97.101(i), or for which a determination was made 
that the research was exempt before January 19, 2018, shall comply with 
the pre-2018 Requirements, except that an institution engaged in such 
research on or after January 19, 2018, may instead comply with the 2018 
Requirements if the institution determines that such ongoing research 
will comply with the 2018 Requirements and an IRB documents such 
determination.
    (4) Research initially approved by an IRB, for which such review was 
waived pursuant to Sec. 97.101(i), or for which a determination was made 
that the research was exempt on or after January 19, 2018, shall comply 
with the 2018 Requirements.
    (m) Severability: Any provision of this part held to be invalid or 
unenforceable by its terms, or as applied to any person or circumstance, 
shall be construed so as to continue to give maximum effect to the 
provision permitted by law, unless such holding shall be one of utter 
invalidity or unenforceability, in which event the provision shall be 
severable from this part and shall not affect the remainder thereof or 
the application of the provision to other persons not similarly situated 
or to other dissimilar circumstances.



Sec. 97.102  Definitions for purposes of this policy.

    (a) Certification means the official notification by the institution 
to the supporting Federal department or agency component, in accordance 
with the requirements of this policy, that a research project or 
activity involving human subjects has been reviewed and approved by an 
IRB in accordance with an approved assurance.
    (b) Clinical trial means a research study in which one or more human 
subjects are prospectively assigned to one or more interventions (which 
may include placebo or other control) to evaluate the effects of the 
interventions on biomedical or behavioral health-related outcomes.
    (c) Department or agency head means the head of any Federal 
department or agency, for example, the Secretary of HHS, and any other 
officer or employee of any Federal department or agency to whom the 
authority provided by these regulations to the department or agency head 
has been delegated.
    (d) Federal department or agency refers to a federal department or 
agency (the department or agency itself rather than its bureaus, offices 
or divisions) that takes appropriate administrative action to make this 
policy applicable to the research involving human subjects it conducts, 
supports, or otherwise regulates (e.g., the U.S. Department of Health 
and Human Services, the U.S. Department of Defense, or the Central 
Intelligence Agency).
    (e)(1) Human subject means a living individual about whom an 
investigator (whether professional or student) conducting research:
    (i) Obtains information or biospecimens through intervention or 
interaction with the individual, and uses, studies, or analyzes the 
information or biospecimens; or (ii) Obtains, uses, studies, analyzes, 
or generates identifiable private information or identifiable 
biospecimens.
    (2) Intervention includes both physical procedures by which 
information or biospecimens are gathered (e.g., venipuncture) and 
manipulations of the subject or the subject's environment that are 
performed for research purposes.
    (3) Interaction includes communication or interpersonal contact 
between investigator and subject.
    (4) Private information includes information about behavior that 
occurs in a context in which an individual can reasonably expect that no 
observation or recording is taking place, and information that has been 
provided for specific purposes by an individual and that the individual 
can reasonably expect will not be made public (e.g., a medical record).
    (5) Identifiable private information is private information for 
which the identity of the subject is or may readily be ascertained by 
the investigator or associated with the information.
    (6) An identifiable biospecimen is a biospecimen for which the 
identity of the subject is or may readily be ascertained by the 
investigator or associated with the biospecimen.
    (7) Federal departments or agencies implementing this policy shall:
    (i) Upon consultation with appropriate experts (including experts in 
data matching and re-identification), reexamine the meaning of 
``identifiable private information,'' as defined in paragraph (e)(5) of 
this section, and ``identifiable biospecimen,'' as defined in paragraph 
(e)(6) of this section. This reexamination shall take place within 1 
year and regularly thereafter (at least every 4 years). This process 
will be conducted by collaboration among the Federal departments and 
agencies implementing this policy. If appropriate and permitted by law, 
such Federal

[[Page 242]]

departments and agencies may alter the interpretation of these terms, 
including through the use of guidance.
    (ii) Upon consultation with appropriate experts, assess whether 
there are analytic technologies or techniques that should be considered 
by investigators to generate ``identifiable private information,'' as 
defined in paragraph (e)(5) of this section, or an ``identifiable 
biospecimen,'' as defined in paragraph (e)(6) of this section. This 
assessment shall take place within 1 year and regularly thereafter (at 
least every 4 years). This process will be conducted by collaboration 
among the Federal departments and agencies implementing this policy. Any 
such technologies or techniques will be included on a list of 
technologies or techniques that produce identifiable private information 
or identifiable biospecimens. This list will be published in the Federal 
Register after notice and an opportunity for public comment. The 
Secretary, HHS, shall maintain the list on a publicly accessible Web 
site.
    (f) Institution means any public or private entity, or department or 
agency (including federal, state, and other agencies).
    (g) IRB means an institutional review board established in accord 
with and for the purposes expressed in this policy.
    (h) IRB approval means the determination of the IRB that the 
research has been reviewed and may be conducted at an institution within 
the constraints set forth by the IRB and by other institutional and 
federal requirements.
    (i) Legally authorized representative means an individual or 
judicial or other body authorized under applicable law to consent on 
behalf of a prospective subject to the subject's participation in the 
procedure(s) involved in the research. If there is no applicable law 
addressing this issue, legally authorized representative means an 
individual recognized by institutional policy as acceptable for 
providing consent in the nonresearch context on behalf of the 
prospective subject to the subject's participation in the procedure(s) 
involved in the research.
    (j) Minimal risk means that the probability and magnitude of harm or 
discomfort anticipated in the research are not greater in and of 
themselves than those ordinarily encountered in daily life or during the 
performance of routine physical or psychological examinations or tests.
    (k) Public health authority means an agency or authority of the 
United States, a state, a territory, a political subdivision of a state 
or territory, an Indian tribe, or a foreign government, or a person or 
entity acting under a grant of authority from or contract with such 
public agency, including the employees or agents of such public agency 
or its contractors or persons or entities to whom it has granted 
authority, that is responsible for public health matters as part of its 
official mandate.
    (l) Research means a systematic investigation, including research 
development, testing, and evaluation, designed to develop or contribute 
to generalizable knowledge. Activities that meet this definition 
constitute research for purposes of this policy, whether or not they are 
conducted or supported under a program that is considered research for 
other purposes. For example, some demonstration and service programs may 
include research activities. For purposes of this part, the following 
activities are deemed not to be research:
    (1) Scholarly and journalistic activities (e.g., oral history, 
journalism, biography, literary criticism, legal research, and 
historical scholarship), including the collection and use of 
information, that focus directly on the specific individuals about whom 
the information is collected.
    (2) Public health surveillance activities, including the collection 
and testing of information or biospecimens, conducted, supported, 
requested, ordered, required, or authorized by a public health 
authority. Such activities are limited to those necessary to allow a 
public health authority to identify, monitor, assess, or investigate 
potential public health signals, onsets of disease outbreaks, or 
conditions of public health importance (including trends, signals, risk 
factors, patterns in diseases, or increases in injuries from using 
consumer products). Such activities include those associated with 
providing timely situational awareness and priority setting during the 
course of an event or crisis that threatens public health (including 
natural or man-made disasters).
    (3) Collection and analysis of information, biospecimens, or records 
by or for a criminal justice agency for activities authorized by law or 
court order solely for criminal justice or criminal investigative 
purposes.
    (4) Authorized operational activities (as determined by each agency) 
in support of intelligence, homeland security, defense, or other 
national security missions.
    (m) Written, or in writing, for purposes of this part, refers to 
writing on a tangible medium (e.g., paper) or in an electronic format.



Sec. 97.103  Assuring compliance with this policy--research 
conducted or supported by any Federal department or agency.

    (a) Each institution engaged in research that is covered by this 
policy, with the exception of research eligible for exemption under 
Sec. 97.104, and that is conducted or supported by a Federal department 
or agency, shall provide written assurance satisfactory to the 
department or agency head that it will comply with the requirements of 
this policy. In lieu of requiring submission of an assurance, individual 
department or agency heads shall accept the existence of a current

[[Page 243]]

assurance, appropriate for the research in question, on file with the 
Office for Human Research Protections, HHS, or any successor office, and 
approved for Federal-wide use by that office. When the existence of an 
HHS-approved assurance is accepted in lieu of requiring submission of an 
assurance, reports (except certification) required by this policy to be 
made to department and agency heads shall also be made to the Office for 
Human Research Protections, HHS, or any successor office. Federal 
departments and agencies will conduct or support research covered by 
this policy only if the institution has provided an assurance that it 
will comply with the requirements of this policy, as provided in this 
section, and only if the institution has certified to the department or 
agency head that the research has been reviewed and approved by an IRB 
(if such certification is required by Sec. 97.103(d)).
    (b) The assurance shall be executed by an individual authorized to 
act for the institution and to assume on behalf of the institution the 
obligations imposed by this policy and shall be filed in such form and 
manner as the department or agency head prescribes.
    (c) The department or agency head may limit the period during which 
any assurance shall remain effective or otherwise condition or restrict 
the assurance.
    (d) Certification is required when the research is supported by a 
Federal department or agency and not otherwise waived under 
Sec. 97.101(i) or exempted under Sec. 97.104. For such research, 
institutions shall certify that each proposed research study covered by 
the assurance and this section has been reviewed and approved by the 
IRB. Such certification must be submitted as prescribed by the Federal 
department or agency component supporting the research. Under no 
condition shall research covered by this section be initiated prior to 
receipt of the certification that the research has been reviewed and 
approved by the IRB.
    (e) For nonexempt research involving human subjects covered by this 
policy (or exempt research for which limited IRB review takes place 
pursuant to Sec. 97.104(d)(2)(iii), (d)(3)(i)(C), or (d)(7) or (8)) that 
takes place at an institution in which IRB oversight is conducted by an 
IRB that is not operated by the institution, the institution and the 
organization operating the IRB shall document the institution's reliance 
on the IRB for oversight of the research and the responsibilities that 
each entity will undertake to ensure compliance with the requirements of 
this policy (e.g., in a written agreement between the institution and 
the IRB, by implementation of an institution-wide policy directive 
providing the allocation of responsibilities between the institution and 
an IRB that is not affiliated with the institution, or as set forth in a 
research protocol).

(Approved by the Office of Management and Budget under Control Number 
0990-0260)



Sec. 97.104  Exempt research.

    (a) Unless otherwise required by law or by department or agency 
heads, research activities in which the only involvement of human 
subjects will be in one or more of the categories in paragraph (d) of 
this section are exempt from the requirements of this policy, except 
that such activities must comply with the requirements of this section 
and as specified in each category.
    (b) Use of the exemption categories for research subject to the 
requirements of subparts B, C, and D: Application of the exemption 
categories to research subject to the requirements of 45 CFR part 46, 
subparts B, C, and D, is as follows:
    (1) Subpart B. Each of the exemptions at this section may be applied 
to research subject to subpart B if the conditions of the exemption are 
met.
    (2) Subpart C. The exemptions at this section do not apply to 
research subject to subpart C, except for research aimed at involving a 
broader subject population that only incidentally includes prisoners.
    (3) Subpart D. The exemptions at paragraphs (d)(1), (4), (5), (6), 
(7), and (8) of this section may be applied to research subject to 
subpart D if the conditions of the exemption are met. Paragraphs 
(d)(2)(i) and (ii) of this section only may apply to research subject to 
subpart D involving educational tests or the observation of public 
behavior when the investigator(s) do not participate in the activities 
being observed. Paragraph (d)(2)(iii) of this section may not be applied 
to research subject to subpart D.
    (c) [Reserved]
    (d) Except as described in paragraph (a) of this section, the 
following categories of human subjects research are exempt from this 
policy:
    (1) Research, conducted in established or commonly accepted 
educational settings, that specifically involves normal educational 
practices that are not likely to adversely impact students' opportunity 
to learn required educational content or the assessment of educators who 
provide instruction. This includes most research on regular and special 
education instructional strategies, and research on the effectiveness of 
or the comparison among instructional techniques, curricula, or 
classroom management methods.
    (2) Research that only includes interactions involving educational 
tests (cognitive, diagnostic, aptitude, achievement), survey procedures, 
interview procedures, or observation of public behavior (including 
visual or auditory recording) if at least one of the following criteria 
is met:
    (i) The information obtained is recorded by the investigator in such 
a manner that the

[[Page 244]]

identity of the human subjects cannot readily be ascertained, directly 
or through identifiers linked to the subjects;
    (ii) Any disclosure of the human subjects' responses outside the 
research would not reasonably place the subjects at risk of criminal or 
civil liability or be damaging to the subjects' financial standing, 
employability, educational advancement, or reputation; or
    (iii) The information obtained is recorded by the investigator in 
such a manner that the identity of the human subjects can readily be 
ascertained, directly or through identifiers linked to the subjects, and 
an IRB conducts a limited IRB review to make the determination required 
by Sec. 97.111(a)(7).
    (3)(i) Research involving benign behavioral interventions in 
conjunction with the collection of information from an adult subject 
through verbal or written responses (including data entry) or 
audiovisual recording if the subject prospectively agrees to the 
intervention and information collection and at least one of the 
following criteria is met:
    (A) The information obtained is recorded by the investigator in such 
a manner that the identity of the human subjects cannot readily be 
ascertained, directly or through identifiers linked to the subjects;
    (B) Any disclosure of the human subjects' responses outside the 
research would not reasonably place the subjects at risk of criminal or 
civil liability or be damaging to the subjects' financial standing, 
employability, educational advancement, or reputation; or
    (C) The information obtained is recorded by the investigator in such 
a manner that the identity of the human subjects can readily be 
ascertained, directly or through identifiers linked to the subjects, and 
an IRB conducts a limited IRB review to make the determination required 
by Sec. 97.111(a)(7).
    (ii) For the purpose of this provision, benign behavioral 
interventions are brief in duration, harmless, painless, not physically 
invasive, not likely to have a significant adverse lasting impact on the 
subjects, and the investigator has no reason to think the subjects will 
find the interventions offensive or embarrassing. Provided all such 
criteria are met, examples of such benign behavioral interventions would 
include having the subjects play an online game, having them solve 
puzzles under various noise conditions, or having them decide how to 
allocate a nominal amount of received cash between themselves and 
someone else.
    (iii) If the research involves deceiving the subjects regarding the 
nature or purposes of the research, this exemption is not applicable 
unless the subject authorizes the deception through a prospective 
agreement to participate in research in circumstances in which the 
subject is informed that he or she will be unaware of or misled 
regarding the nature or purposes of the research.
    (4) Secondary research for which consent is not required: Secondary 
research uses of identifiable private information or identifiable 
biospecimens, if at least one of the following criteria is met:
    (i) The identifiable private information or identifiable 
biospecimens are publicly available;
    (ii) Information, which may include information about biospecimens, 
is recorded by the investigator in such a manner that the identity of 
the human subjects cannot readily be ascertained directly or through 
identifiers linked to the subjects, the investigator does not contact 
the subjects, and the investigator will not re-identify subjects;
    (iii) The research involves only information collection and analysis 
involving the investigator's use of identifiable health information when 
that use is regulated under 45 CFR parts 160 and 164, subparts A and E, 
for the purposes of ``health care operations'' or ``research'' as those 
terms are defined at 45 CFR 164.501 or for ``public health activities 
and purposes'' as described under 45 CFR 164.512(b); or
    (iv) The research is conducted by, or on behalf of, a Federal 
department or agency using government-generated or government-collected 
information obtained for nonresearch activities, if the research 
generates identifiable private information that is or will be maintained 
on information technology that is subject to and in compliance with 
section 208(b) of the E-Government Act of 2002, 44 U.S.C. 3501 note, if 
all of the identifiable private information collected, used, or 
generated as part of the activity will be maintained in systems of 
records subject to the Privacy Act of 1974, 5 U.S.C. 552a, and, if 
applicable, the information used in the research was collected subject 
to the Paperwork Reduction Act of 1995, 44 U.S.C. 3501 et seq.
    (5) Research and demonstration projects that are conducted or 
supported by a Federal department or agency, or otherwise subject to the 
approval of department or agency heads (or the approval of the heads of 
bureaus or other subordinate agencies that have been delegated authority 
to conduct the research and demonstration projects), and that are 
designed to study, evaluate, improve, or otherwise examine public 
benefit or service programs, including procedures for obtaining benefits 
or services under those programs, possible changes in or alternatives to 
those programs or procedures, or possible changes in methods or levels 
of payment for benefits or services under those programs. Such projects 
include, but are not limited to, internal studies by Federal employees, 
and studies under contracts or consulting arrangements, cooperative 
agreements, or grants. Exempt projects also include waivers

[[Page 245]]

of otherwise mandatory requirements using authorities such as sections 
1115 and 1115A of the Social Security Act, as amended.
    (i) Each Federal department or agency conducting or supporting the 
research and demonstration projects must establish, on a publicly 
accessible Federal Web site or in such other manner as the department or 
agency head may determine, a list of the research and demonstration 
projects that the Federal department or agency conducts or supports 
under this provision. The research or demonstration project must be 
published on this list prior to commencing the research involving human 
subjects.
    (ii) [Reserved]
    (6) Taste and food quality evaluation and consumer acceptance 
studies:
    (i) If wholesome foods without additives are consumed, or
    (ii) If a food is consumed that contains a food ingredient at or 
below the level and for a use found to be safe, or agricultural chemical 
or environmental contaminant at or below the level found to be safe, by 
the Food and Drug Administration or approved by the Environmental 
Protection Agency or the Food Safety and Inspection Service of the U.S. 
Department of Agriculture.
    (7) Storage or maintenance for secondary research for which broad 
consent is required: Storage or maintenance of identifiable private 
information or identifiable biospecimens for potential secondary 
research use if an IRB conducts a limited IRB review and makes the 
determinations required by Sec. 97.111(a)(8).
    (8) Secondary research for which broad consent is required: Research 
involving the use of identifiable private information or identifiable 
biospecimens for secondary research use, if the following criteria are 
met:
    (i) Broad consent for the storage, maintenance, and secondary 
research use of the identifiable private information or identifiable 
biospecimens was obtained in accordance with Sec. 97.116(a)(1) through 
(4), (a)(6), and (d);
    (ii) Documentation of informed consent or waiver of documentation of 
consent was obtained in accordance with Sec. 97.117;
    (iii) An IRB conducts a limited IRB review and makes the 
determination required by Sec. 97.111(a)(7) and makes the determination 
that the research to be conducted is within the scope of the broad 
consent referenced in paragraph (d)(8)(i) of this section; and (iv) The 
investigator does not include returning individual research results to 
subjects as part of the study plan. This provision does not prevent an 
investigator from abiding by any legal requirements to return individual 
research results.

(Approved by the Office of Management and Budget under Control Number 
0990-0260)



Sec. 97.105  [Reserved]



Sec. 97.106  [Reserved]



Sec. 97.107  IRB membership.

    (a) Each IRB shall have at least five members, with varying 
backgrounds to promote complete and adequate review of research 
activities commonly conducted by the institution. The IRB shall be 
sufficiently qualified through the experience and expertise of its 
members (professional competence), and the diversity of its members, 
including race, gender, and cultural backgrounds and sensitivity to such 
issues as community attitudes, to promote respect for its advice and 
counsel in safeguarding the rights and welfare of human subjects. The 
IRB shall be able to ascertain the acceptability of proposed research in 
terms of institutional commitments (including policies and resources) 
and regulations, applicable law, and standards of professional conduct 
and practice. The IRB shall therefore include persons knowledgeable in 
these areas. If an IRB regularly reviews research that involves a 
category of subjects that is vulnerable to coercion or undue influence, 
such as children, prisoners, individuals with impaired decision-making 
capacity, or economically or educationally disadvantaged persons, 
consideration shall be given to the inclusion of one or more individuals 
who are knowledgeable about and experienced in working with these 
categories of subjects.
    (b) Each IRB shall include at least one member whose primary 
concerns are in scientific areas and at least one member whose primary 
concerns are in nonscientific areas.
    (c) Each IRB shall include at least one member who is not otherwise 
affiliated with the institution and who is not part of the immediate 
family of a person who is affiliated with the institution.
    (d) No IRB may have a member participate in the IRB's initial or 
continuing review of any project in which the member has a conflicting 
interest, except to provide information requested by the IRB.
    (e) An IRB may, in its discretion, invite individuals with 
competence in special areas to assist in the review of issues that 
require expertise beyond or in addition to that available on the IRB. 
These individuals may not vote with the IRB.



Sec. 97.108  IRB functions and operations.

    (a) In order to fulfill the requirements of this policy each IRB 
shall:
    (1) Have access to meeting space and sufficient staff to support the 
IRB's review and recordkeeping duties;
    (2) Prepare and maintain a current list of the IRB members 
identified by name; earned degrees; representative capacity; indications 
of experience such as board certifications or licenses sufficient to 
describe each member's

[[Page 246]]

chief anticipated contributions to IRB deliberations; and any employment 
or other relationship between each member and the institution, for 
example, full-time employee, part-time employee, member of governing 
panel or board, stockholder, paid or unpaid consultant;
    (3) Establish and follow written procedures for:
    (i) Conducting its initial and continuing review of research and for 
reporting its findings and actions to the investigator and the 
institution;
    (ii) Determining which projects require review more often than 
annually and which projects need verification from sources other than 
the investigators that no material changes have occurred since previous 
IRB review; and
    (iii) Ensuring prompt reporting to the IRB of proposed changes in a 
research activity, and for ensuring that investigators will conduct the 
research activity in accordance with the terms of the IRB approval until 
any proposed changes have been reviewed and approved by the IRB, except 
when necessary to eliminate apparent immediate hazards to the subject.
    (4) Establish and follow written procedures for ensuring prompt 
reporting to the IRB; appropriate institutional officials; the 
department or agency head; and the Office for Human Research 
Protections, HHS, or any successor office, or the equivalent office 
within the appropriate Federal department or agency of
    (i) Any unanticipated problems involving risks to subjects or others 
or any serious or continuing noncompliance with this policy or the 
requirements or determinations of the IRB; and
    (ii) Any suspension or termination of IRB approval.
    (b) Except when an expedited review procedure is used (as described 
in Sec. 97.110), an IRB must review proposed research at convened 
meetings at which a majority of the members of the IRB are present, 
including at least one member whose primary concerns are in 
nonscientific areas. In order for the research to be approved, it shall 
receive the approval of a majority of those members present at the 
meeting.

(Approved by the Office of Management and Budget under Control Number 
0990-0260)



Sec. 97.109  IRB review of research.

    (a) An IRB shall review and have authority to approve, require 
modifications in (to secure approval), or disapprove all research 
activities covered by this policy, including exempt research activities 
under Sec. 97.104 for which limited IRB review is a condition of 
exemption (under Sec. 97.104(d)(2)(iii), (d)(3)(i)(C), and (d)(7), and 
(8)).
    (b) An IRB shall require that information given to subjects (or 
legally authorized representatives, when appropriate) as part of 
informed consent is in accordance with Sec. 97.116. The IRB may require 
that information, in addition to that specifically mentioned in 
Sec. 97.116, be given to the subjects when in the IRB's judgment the 
information would meaningfully add to the protection of the rights and 
welfare of subjects.
    (c) An IRB shall require documentation of informed consent or may 
waive documentation in accordance with Sec. 97.117.
    (d) An IRB shall notify investigators and the institution in writing 
of its decision to approve or disapprove the proposed research activity, 
or of modifications required to secure IRB approval of the research 
activity. If the IRB decides to disapprove a research activity, it shall 
include in its written notification a statement of the reasons for its 
decision and give the investigator an opportunity to respond in person 
or in writing.
    (e) An IRB shall conduct continuing review of research requiring 
review by the convened IRB at intervals appropriate to the degree of 
risk, not less than once per year, except as described in 
Sec. 97.109(f).
    (f)(1) Unless an IRB determines otherwise, continuing review of 
research is not required in the following circumstances:
    (i) Research eligible for expedited review in accordance with 
Sec. 97.110;
    (ii) Research reviewed by the IRB in accordance with the limited IRB 
review described in Sec. 97.104(d)(2)(iii), (d)(3)(i)(C), or (d)(7) or 
(8);
    (iii) Research that has progressed to the point that it involves 
only one or both of the following, which are part of the IRB-approved 
study:
    (A) Data analysis, including analysis of identifiable private 
information or identifiable biospecimens, or
    (B) Accessing follow-up clinical data from procedures that subjects 
would undergo as part of clinical care.
    (2) [Reserved.]
    (g) An IRB shall have authority to observe or have a third party 
observe the consent process and the research.

(Approved by the Office of Management and Budget under Control Number 
0990-0260)



Sec. 97.110  Expedited review procedures for certain kinds of research 
          involving no more than minimal risk, and for minor changes in 
          approved research.

    (a) The Secretary of HHS has established, and published as a Notice 
in the Federal Register, a list of categories of research that may be 
reviewed by the IRB through an expedited review procedure. The Secretary 
will evaluate the list at least every 8 years and amend it, as 
appropriate, after consultation with other federal departments and

[[Page 247]]

agencies and after publication in the Federal Register for public 
comment. A copy of the list is available from the Office for Human 
Research Protections, HHS, or any successor office.
    (b)(1) An IRB may use the expedited review procedure to review the 
following:
    (i) Some or all of the research appearing on the list described in 
paragraph (a) of this section, unless the reviewer determines that the 
study involves more than minimal risk;
    (ii) Minor changes in previously approved research during the period 
for which approval is authorized; or
    (iii) Research for which limited IRB review is a condition of 
exemption under Sec. 97.104(d)(2)(iii), (d)(3)(i)(C), and (d)(7) and 
(8).
    (2) Under an expedited review procedure, the review may be carried 
out by the IRB chairperson or by one or more experienced reviewers 
designated by the chairperson from among members of the IRB. In 
reviewing the research, the reviewers may exercise all of the 
authorities of the IRB except that the reviewers may not disapprove the 
research. A research activity may be disapproved only after review in 
accordance with the nonexpedited procedure set forth in Sec. 97.108(b).
    (c) Each IRB that uses an expedited review procedure shall adopt a 
method for keeping all members advised of research proposals that have 
been approved under the procedure.
    (d) The department or agency head may restrict, suspend, terminate, 
or choose not to authorize an institution's or IRB's use of the 
expedited review procedure.



Sec. 97.111  Criteria for IRB approval of research.

    (a) In order to approve research covered by this policy the IRB 
shall determine that all of the following requirements are satisfied:
    (1) Risks to subjects are minimized:
    (i) By using procedures that are consistent with sound research 
design and that do not unnecessarily expose subjects to risk, and
    (ii) Whenever appropriate, by using procedures already being 
performed on the subjects for diagnostic or treatment purposes.
    (2) Risks to subjects are reasonable in relation to anticipated 
benefits, if any, to subjects, and the importance of the knowledge that 
may reasonably be expected to result. In evaluating risks and benefits, 
the IRB should consider only those risks and benefits that may result 
from the research (as distinguished from risks and benefits of therapies 
subjects would receive even if not participating in the research). The 
IRB should not consider possible long-range effects of applying 
knowledge gained in the research (e.g., the possible effects of the 
research on public policy) as among those research risks that fall 
within the purview of its responsibility.
    (3) Selection of subjects is equitable. In making this assessment 
the IRB should take into account the purposes of the research and the 
setting in which the research will be conducted. The IRB should be 
particularly cognizant of the special problems of research that involves 
a category of subjects who are vulnerable to coercion or undue 
influence, such as children, prisoners, individuals with impaired 
decision-making capacity, or economically or educationally disadvantaged 
persons.
    (4) Informed consent will be sought from each prospective subject or 
the subject's legally authorized representative, in accordance with, and 
to the extent required by, Sec. 97.116.
    (5) Informed consent will be appropriately documented or 
appropriately waived in accordance with Sec. 97.117.
    (6) When appropriate, the research plan makes adequate provision for 
monitoring the data collected to ensure the safety of subjects.
    (7) When appropriate, there are adequate provisions to protect the 
privacy of subjects and to maintain the confidentiality of data.
    (i) The Secretary of HHS will, after consultation with the Office of 
Management and Budget's privacy office and other Federal departments and 
agencies that have adopted this policy, issue guidance to assist IRBs in 
assessing what provisions are adequate to protect the privacy of 
subjects and to maintain the confidentiality of data.
    (ii) [Reserved]
    (8) For purposes of conducting the limited IRB review required by 
Sec. 97.104(d)(7)), the IRB need not make the determinations at 
paragraphs (a)(1) through (7) of this section, and shall make the 
following determinations:
    (i) Broad consent for storage, maintenance, and secondary research 
use of identifiable private information or identifiable biospecimens is 
obtained in accordance with the requirements of Sec. 97.116(a)(1)-(4), 
(a)(6), and (d);
    (ii) Broad consent is appropriately documented or waiver of 
documentation is appropriate, in accordance with Sec. 97.117; and
    (iii) If there is a change made for research purposes in the way the 
identifiable private information or identifiable biospecimens are stored 
or maintained, there are adequate provisions to protect the privacy of 
subjects and to maintain the confidentiality of data.
    (b) When some or all of the subjects are likely to be vulnerable to 
coercion or undue influence, such as children, prisoners, individuals 
with impaired decision-making capacity, or economically or educationally 
disadvantaged persons, additional safeguards have been included in the 
study to protect the rights and welfare of these subjects.



Sec. 97.112  Review by Institution

    Research covered by this policy that has been approved by an IRB may 
be subject to

[[Page 248]]

further appropriate review and approval or disapproval by officials of 
the institution. However, those officials may not approve the research 
if it has not been approved by an IRB.



Sec. 97.113  Suspension or Termination of IRB Approval of Research.

    An IRB shall have authority to suspend or terminate approval of 
research that is not being conducted in accordance with the IRB's 
requirements or that has been associated with unexpected serious harm to 
subjects. Any suspension or termination of approval shall include a 
statement of the reasons for the IRB's action and shall be reported 
promptly to the investigator, appropriate institutional officials, and 
the department or agency head.

(Approved by the Office of Management and Budget under Control Number 
0990-0260)



Sec. 97.114  Cooperative Research.

    (a) Cooperative research projects are those projects covered by this 
policy that involve more than one institution. In the conduct of 
cooperative research projects, each institution is responsible for 
safeguarding the rights and welfare of human subjects and for complying 
with this policy.
    (b)(1) Any institution located in the United States that is engaged 
in cooperative research must rely upon approval by a single IRB for that 
portion of the research that is conducted in the United States. The 
reviewing IRB will be identified by the Federal department or agency 
supporting or conducting the research or proposed by the lead 
institution subject to the acceptance of the Federal department or 
agency supporting the research.
    (2) The following research is not subject to this provision:
    (i) Cooperative research for which more than single IRB review is 
required by law (including tribal law passed by the official governing 
body of an American Indian or Alaska Native tribe); or
    (ii) Research for which any Federal department or agency supporting 
or conducting the research determines and documents that the use of a 
single IRB is not appropriate for the particular context.
    (c) For research not subject to paragraph (b) of this section, an 
institution participating in a cooperative project may enter into a 
joint review arrangement, rely on the review of another IRB, or make 
similar arrangements for avoiding duplication of effort.



Sec. 97.115  IRB Records.

    (a) An institution, or when appropriate an IRB, shall prepare and 
maintain adequate documentation of IRB activities, including the 
following:
    (1) Copies of all research proposals reviewed, scientific 
evaluations, if any, that accompany the proposals, approved sample 
consent forms, progress reports submitted by investigators, and reports 
of injuries to subjects.
    (2) Minutes of IRB meetings, which shall be in sufficient detail to 
show attendance at the meetings; actions taken by the IRB; the vote on 
these actions including the number of members voting for, against, and 
abstaining; the basis for requiring changes in or disapproving research; 
and a written summary of the discussion of controverted issues and their 
resolution.
    (3) Records of continuing review activities, including the rationale 
for conducting continuing review of research that otherwise would not 
require continuing review as described in Sec. 97.109(f)(1).
    (4) Copies of all correspondence between the IRB and the 
investigators.
    (5) A list of IRB members in the same detail as described in 
Sec. 97.108(a)(2).
    (6) Written procedures for the IRB in the same detail as described 
in Sec. 97.108(a)(3) and (4).
    (7) Statements of significant new findings provided to subjects, as 
required by Sec. 97.116(c)(5).
    (8) The rationale for an expedited reviewer's determination under 
Sec. 97.110(b)(1)(i) that research appearing on the expedited review 
list described in Sec. 97.110(a) is more than minimal risk.
    (9) Documentation specifying the responsibilities that an 
institution and an organization operating an IRB each will undertake to 
ensure compliance with the requirements of this policy, as described in 
Sec. 97.103(e).
    (b) The records required by this policy shall be retained for at 
least 3 years, and records relating to research that is conducted shall 
be retained for at least 3 years after completion of the research. The 
institution or IRB may maintain the records in printed form, or 
electronically. All records shall be accessible for inspection and 
copying by authorized representatives of the Federal department or 
agency at reasonable times and in a reasonable manner.

(Approved by the Office of Management and Budget under Control Number 
0990-0260)



Sec. 97.116  General Requirements for Informed Consent.

    (a) General. General requirements for informed consent, whether 
written or oral, are set forth in this paragraph and apply to consent 
obtained in accordance with the requirements set forth in paragraphs (b) 
through (d) of this section. Broad consent may be obtained in lieu of 
informed consent obtained in accordance with paragraphs (b) and (c) of 
this section only with respect to

[[Page 249]]

the storage, maintenance, and secondary research uses of identifiable 
private information and identifiable biospecimens. Waiver or alteration 
of consent in research involving public benefit and service programs 
conducted by or subject to the approval of state or local officials is 
described in paragraph (e) of this section. General waiver or alteration 
of informed consent is described in paragraph (f) of this section. 
Except as provided elsewhere in this policy:
    (1) Before involving a human subject in research covered by this 
policy, an investigator shall obtain the legally effective informed 
consent of the subject or the subject's legally authorized 
representative.
    (2) An investigator shall seek informed consent only under 
circumstances that provide the prospective subject or the legally 
authorized representative sufficient opportunity to discuss and consider 
whether or not to participate and that minimize the possibility of 
coercion or undue influence.
    (3) The information that is given to the subject or the legally 
authorized representative shall be in language understandable to the 
subject or the legally authorized representative.
    (4) The prospective subject or the legally authorized representative 
must be provided with the information that a reasonable person would 
want to have in order to make an informed decision about whether to 
participate, and an opportunity to discuss that information.
    (5) Except for broad consent obtained in accordance with paragraph 
(d) of this section:
    (i) Informed consent must begin with a concise and focused 
presentation of the key information that is most likely to assist a 
prospective subject or legally authorized representative in 
understanding the reasons why one might or might not want to participate 
in the research. This part of the informed consent must be organized and 
presented in a way that facilitates comprehension.
    (ii) Informed consent as a whole must present information in 
sufficient detail relating to the research, and must be organized and 
presented in a way that does not merely provide lists of isolated facts, 
but rather facilitates the prospective subject's or legally authorized 
representative's understanding of the reasons why one might or might not 
want to participate.
    (6) No informed consent may include any exculpatory language through 
which the subject or the legally authorized representative is made to 
waive or appear to waive any of the subject's legal rights, or releases 
or appears to release the investigator, the sponsor, the institution, or 
its agents from liability for negligence.
    (b) Basic elements of informed consent. Except as provided in 
paragraph (d), (e), or (f) of this section, in seeking informed consent 
the following information shall be provided to each subject or the 
legally authorized representative:
    (1) A statement that the study involves research, an explanation of 
the purposes of the research and the expected duration of the subject's 
participation, a description of the procedures to be followed, and 
identification of any procedures that are experimental;
    (2) A description of any reasonably foreseeable risks or discomforts 
to the subject;
    (3) A description of any benefits to the subject or to others that 
may reasonably be expected from the research;
    (4) A disclosure of appropriate alternative procedures or courses of 
treatment, if any, that might be advantageous to the subject;
    (5) A statement describing the extent, if any, to which 
confidentiality of records identifying the subject will be maintained;
    (6) For research involving more than minimal risk, an explanation as 
to whether any compensation and an explanation as to whether any medical 
treatments are available if injury occurs and, if so, what they consist 
of, or where further information may be obtained;
    (7) An explanation of whom to contact for answers to pertinent 
questions about the research and research subjects' rights, and whom to 
contact in the event of a research-related injury to the subject;
    (8) A statement that participation is voluntary, refusal to 
participate will involve no penalty or loss of benefits to which the 
subject is otherwise entitled, and the subject may discontinue 
participation at any time without penalty or loss of benefits to which 
the subject is otherwise entitled; and
    (9) One of the following statements about any research that involves 
the collection of identifiable private information or identifiable 
biospecimens:
    (i) A statement that identifiers might be removed from the 
identifiable private information or identifiable biospecimens and that, 
after such removal, the information or biospecimens could be used for 
future research studies or distributed to another investigator for 
future research studies without additional informed consent from the 
subject or the legally authorized representative, if this might be a 
possibility; or
    (ii) A statement that the subject's information or biospecimens 
collected as part of the research, even if identifiers are removed, will 
not be used or distributed for future research studies.
    (c) Additional elements of informed consent. Except as provided in 
paragraph (d), (e), or (f) of this section, one or more of the following 
elements of information, when appropriate, shall also be provided to 
each subject or the legally authorized representative:
    (1) A statement that the particular treatment or procedure may 
involve risks to the

[[Page 250]]

subject (or to the embryo or fetus, if the subject is or may become 
pregnant) that are currently unforeseeable;
    (2) Anticipated circumstances under which the subject's 
participation may be terminated by the investigator without regard to 
the subject's or the legally authorized representative's consent;
    (3) Any additional costs to the subject that may result from 
participation in the research;
    (4) The consequences of a subject's decision to withdraw from the 
research and procedures for orderly termination of participation by the 
subject;
    (5) A statement that significant new findings developed during the 
course of the research that may relate to the subject's willingness to 
continue participation will be provided to the subject;
    (6) The approximate number of subjects involved in the study;
    (7) A statement that the subject's biospecimens (even if identifiers 
are removed) may be used for commercial profit and whether the subject 
will or will not share in this commercial profit;
    (8) A statement regarding whether clinically relevant research 
results, including individual research results, will be disclosed to 
subjects, and if so, under what conditions; and
    (9) For research involving biospecimens, whether the research will 
(if known) or might include whole genome sequencing (i.e., sequencing of 
a human germline or somatic specimen with the intent to generate the 
genome or exome sequence of that specimen).
    (d) Elements of broad consent for the storage, maintenance, and 
secondary research use of identifiable private information or 
identifiable biospecimens. Broad consent for the storage, maintenance, 
and secondary research use of identifiable private information or 
identifiable biospecimens (collected for either research studies other 
than the proposed research or nonresearch purposes) is permitted as an 
alternative to the informed consent requirements in paragraphs (b) and 
(c) of this section. If the subject or the legally authorized 
representative is asked to provide broad consent, the following shall be 
provided to each subject or the subject's legally authorized 
representative:
    (1) The information required in paragraphs (b)(2), (b)(3), (b)(5), 
and (b)(8) and, when appropriate, (c)(7) and (9) of this section;
    (2) A general description of the types of research that may be 
conducted with the identifiable private information or identifiable 
biospecimens. This description must include sufficient information such 
that a reasonable person would expect that the broad consent would 
permit the types of research conducted;
    (3) A description of the identifiable private information or 
identifiable biospecimens that might be used in research, whether 
sharing of identifiable private information or identifiable biospecimens 
might occur, and the types of institutions or researchers that might 
conduct research with the identifiable private information or 
identifiable biospecimens;
    (4) A description of the period of time that the identifiable 
private information or identifiable biospecimens may be stored and 
maintained (which period of time could be indefinite), and a description 
of the period of time that the identifiable private information or 
identifiable biospecimens may be used for research purposes (which 
period of time could be indefinite);
    (5) Unless the subject or legally authorized representative will be 
provided details about specific research studies, a statement that they 
will not be informed of the details of any specific research studies 
that might be conducted using the subject's identifiable private 
information or identifiable biospecimens, including the purposes of the 
research, and that they might have chosen not to consent to some of 
those specific research studies;
    (6) Unless it is known that clinically relevant research results, 
including individual research results, will be disclosed to the subject 
in all circumstances, a statement that such results may not be disclosed 
to the subject; and
    (7) An explanation of whom to contact for answers to questions about 
the subject's rights and about storage and use of the subject's 
identifiable private information or identifiable biospecimens, and whom 
to contact in the event of a research-related harm.
    (e) Waiver or alteration of consent in research involving public 
benefit and service programs conducted by or subject to the approval of 
state or local officials--(1) Waiver. An IRB may waive the requirement 
to obtain informed consent for research under paragraphs (a) through (c) 
of this section, provided the IRB satisfies the requirements of 
paragraph (e)(3) of this section. If an individual was asked to provide 
broad consent for the storage, maintenance, and secondary research use 
of identifiable private information or identifiable biospecimens in 
accordance with the requirements at paragraph (d) of this section, and 
refused to consent, an IRB cannot waive consent for the storage, 
maintenance, or secondary research use of the identifiable private 
information or identifiable biospecimens.
    (2) Alteration. An IRB may approve a consent procedure that omits 
some, or alters some or all, of the elements of informed consent set 
forth in paragraphs (b) and (c) of this section provided the IRB 
satisfies the requirements of paragraph (e)(3) of this section. An IRB 
may not omit or alter any of the requirements described in paragraph (a) 
of this section. If a broad consent procedure

[[Page 251]]

is used, an IRB may not omit or alter any of the elements required under 
paragraph (d) of this section.
    (3) Requirements for waiver and alteration. In order for an IRB to 
waive or alter consent as described in this subsection, the IRB must 
find and document that:
    (i) The research or demonstration project is to be conducted by or 
subject to the approval of state or local government officials and is 
designed to study, evaluate, or otherwise examine:
    (A) Public benefit or service programs;
    (B) Procedures for obtaining benefits or services under those 
programs;
    (C) Possible changes in or alternatives to those programs or 
procedures; or
    (D) Possible changes in methods or levels of payment for benefits or 
services under those programs; and
    (ii) The research could not practicably be carried out without the 
waiver or alteration.
    (f) General waiver or alteration of consent--(1) Waiver. An IRB may 
waive the requirement to obtain informed consent for research under 
paragraphs (a) through (c) of this section, provided the IRB satisfies 
the requirements of paragraph (f)(3) of this section. If an individual 
was asked to provide broad consent for the storage, maintenance, and 
secondary research use of identifiable private information or 
identifiable biospecimens in accordance with the requirements at 
paragraph (d) of this section, and refused to consent, an IRB cannot 
waive consent for the storage, maintenance, or secondary research use of 
the identifiable private information or identifiable biospecimens.
    (2) Alteration. An IRB may approve a consent procedure that omits 
some, or alters some or all, of the elements of informed consent set 
forth in paragraphs (b) and (c) of this section provided the IRB 
satisfies the requirements of paragraph (f)(3) of this section. An IRB 
may not omit or alter any of the requirements described in paragraph (a) 
of this section. If a broad consent procedure is used, an IRB may not 
omit or alter any of the elements required under paragraph (d) of this 
section.
    (3) Requirements for waiver and alteration. In order for an IRB to 
waive or alter consent as described in this subsection, the IRB must 
find and document that:
    (i) The research involves no more than minimal risk to the subjects;
    (ii) The research could not practicably be carried out without the 
requested waiver or alteration;
    (iii) If the research involves using identifiable private 
information or identifiable biospecimens, the research could not 
practicably be carried out without using such information or 
biospecimens in an identifiable format;
    (iv) The waiver or alteration will not adversely affect the rights 
and welfare of the subjects; and
    (v) Whenever appropriate, the subjects or legally authorized 
representatives will be provided with additional pertinent information 
after participation.
    (g) Screening, recruiting, or determining eligibility. An IRB may 
approve a research proposal in which an investigator will obtain 
information or biospecimens for the purpose of screening, recruiting, or 
determining the eligibility of prospective subjects without the informed 
consent of the prospective subject or the subject's legally authorized 
representative, if either of the following conditions are met:
    (1) The investigator will obtain information through oral or written 
communication with the prospective subject or legally authorized 
representative, or
    (2) The investigator will obtain identifiable private information or 
identifiable biospecimens by accessing records or stored identifiable 
biospecimens.
    (h) Posting of clinical trial consent form. (1) For each clinical 
trial conducted or supported by a Federal department or agency, one IRB-
approved informed consent form used to enroll subjects must be posted by 
the awardee or the Federal department or agency component conducting the 
trial on a publicly available Federal Web site that will be established 
as a repository for such informed consent forms.
    (2) If the Federal department or agency supporting or conducting the 
clinical trial determines that certain information should not be made 
publicly available on a Federal Web site (e.g. confidential commercial 
information), such Federal department or agency may permit or require 
redactions to the information posted.
    (3) The informed consent form must be posted on the Federal Web site 
after the clinical trial is closed to recruitment, and no later than 60 
days after the last study visit by any subject, as required by the 
protocol.
    (i) Preemption. The informed consent requirements in this policy are 
not intended to preempt any applicable Federal, state, or local laws 
(including tribal laws passed by the official governing body of an 
American Indian or Alaska Native tribe) that require additional 
information to be disclosed in order for informed consent to be legally 
effective.
    (j) Emergency medical care. Nothing in this policy is intended to 
limit the authority of a physician to provide emergency medical care, to 
the extent the physician is permitted to do so under applicable Federal, 
state, or local law (including tribal law passed by the official 
governing body of an American Indian or Alaska Native tribe).

[[Page 252]]


(Approved by the Office of Management and Budget under Control Number 
0990-0260)



Sec. 97.117  Documentation of informed consent.

    (a) Except as provided in paragraph (c) of this section, informed 
consent shall be documented by the use of a written informed consent 
form approved by the IRB and signed (including in an electronic format) 
by the subject or the subject's legally authorized representative. A 
written copy shall be given to the person signing the informed consent 
form.
    (b) Except as provided in paragraph (c) of this section, the 
informed consent form may be either of the following:
    (1) A written informed consent form that meets the requirements of 
Sec. 97.116. The investigator shall give either the subject or the 
subject's legally authorized representative adequate opportunity to read 
the informed consent form before it is signed; alternatively, this form 
may be read to the subject or the subject's legally authorized 
representative.
    (2) A short form written informed consent form stating that the 
elements of informed consent required by Sec. 97.116 have been presented 
orally to the subject or the subject's legally authorized 
representative, and that the key information required by 
Sec. 97.116(a)(5)(i) was presented first to the subject, before other 
information, if any, was provided. The IRB shall approve a written 
summary of what is to be said to the subject or the legally authorized 
representative. When this method is used, there shall be a witness to 
the oral presentation. Only the short form itself is to be signed by the 
subject or the subject's legally authorized representative. However, the 
witness shall sign both the short form and a copy of the summary, and 
the person actually obtaining consent shall sign a copy of the summary. 
A copy of the summary shall be given to the subject or the subject's 
legally authorized representative, in addition to a copy of the short 
form.
    (c)(1) An IRB may waive the requirement for the investigator to 
obtain a signed informed consent form for some or all subjects if it 
finds any of the following:
    (i) That the only record linking the subject and the research would 
be the informed consent form and the principal risk would be potential 
harm resulting from a breach of confidentiality. Each subject (or 
legally authorized representative) will be asked whether the subject 
wants documentation linking the subject with the research, and the 
subject's wishes will govern;
    (ii) That the research presents no more than minimal risk of harm to 
subjects and involves no procedures for which written consent is 
normally required outside of the research context; or
    (iii) If the subjects or legally authorized representatives are 
members of a distinct cultural group or community in which signing forms 
is not the norm, that the research presents no more than minimal risk of 
harm to subjects and provided there is an appropriate alternative 
mechanism for documenting that informed consent was obtained.
    (2) In cases in which the documentation requirement is waived, the 
IRB may require the investigator to provide subjects or legally 
authorized representatives with a written statement regarding the 
research.

(Approved by the Office of Management and Budget under Control Number 
0990-0260)



Sec. 97.118  Applications and proposals lacking definite plans for 
          involvement of human subjects.

    Certain types of applications for grants, cooperative agreements, or 
contracts are submitted to Federal departments or agencies with the 
knowledge that subjects may be involved within the period of support, 
but definite plans would not normally be set forth in the application or 
proposal. These include activities such as institutional type grants 
when selection of specific projects is the institution's responsibility; 
research training grants in which the activities involving subjects 
remain to be selected; and projects in which human subjects' involvement 
will depend upon completion of instruments, prior animal studies, or 
purification of compounds. Except for research waived under 
Sec. 97.101(i) or exempted under Sec. 97.104, no human subjects may be 
involved in any project supported by these awards until the project has 
been reviewed and approved by the IRB, as provided in this policy, and 
certification submitted, by the institution, to the Federal department 
or agency component supporting the research.



Sec. 97.119  Research undertaken without the intention of involving 
          human subjects.

    Except for research waived under Sec. 97.101(i) or exempted under 
Sec. 97.104, in the event research is undertaken without the intention 
of involving human subjects, but it is later proposed to involve human 
subjects in the research, the research shall first be reviewed and 
approved by an IRB, as provided in this policy, a certification 
submitted by the institution to the Federal department or agency 
component supporting the research, and final approval given to the 
proposed change by the Federal department or agency component.

[[Page 253]]



Sec. 97.120  Evaluation and disposition of applications and proposals 
          for research to be conducted or supported by a Federal 
          department or agency.

    (a) The department or agency head will evaluate all applications and 
proposals involving human subjects submitted to the Federal department 
or agency through such officers and employees of the Federal department 
or agency and such experts and consultants as the department or agency 
head determines to be appropriate. This evaluation will take into 
consideration the risks to the subjects, the adequacy of protection 
against these risks, the potential benefits of the research to the 
subjects and others, and the importance of the knowledge gained or to be 
gained.
    (b) On the basis of this evaluation, the department or agency head 
may approve or disapprove the application or proposal, or enter into 
negotiations to develop an approvable one.



Sec. 97.121  [Reserved]



Sec. 97.122  Use of Federal funds.

    Federal funds administered by a Federal department or agency may not 
be expended for research involving human subjects unless the 
requirements of this policy have been satisfied.



Sec. 97.123  Early termination of research support: Evaluation of 
          applications and proposals.

    (a) The department or agency head may require that Federal 
department or agency support for any project be terminated or suspended 
in the manner prescribed in applicable program requirements, when the 
department or agency head finds an institution has materially failed to 
comply with the terms of this policy.
    (b) In making decisions about supporting or approving applications 
or proposals covered by this policy the department or agency head may 
take into account, in addition to all other eligibility requirements and 
program criteria, factors such as whether the applicant has been subject 
to a termination or suspension under paragraph (a) of this section and 
whether the applicant or the person or persons who would direct or has/
have directed the scientific and technical aspects of an activity has/
have, in the judgment of the department or agency head, materially 
failed to discharge responsibility for the protection of the rights and 
welfare of human subjects (whether or not the research was subject to 
federal regulation).



Sec. 97.124  Conditions.

    With respect to any research project or any class of research 
projects the department or agency head of either the conducting or the 
supporting Federal department or agency may impose additional conditions 
prior to or at the time of approval when in the judgment of the 
department or agency head additional conditions are necessary for the 
protection of human subjects.



PART 98_STUDENT RIGHTS IN RESEARCH, EXPERIMENTAL PROGRAMS,
AND TESTING--Table of Contents



Sec.
98.1  Applicability of part.
98.2  Definitions.
98.3  Access to instructional material used in a research or 
          experimentation program.
98.4  Protection of students' privacy in examination, testing, or 
          treatment.
98.5  Information and investigation office.
98.6  Reports.
98.7  Filing a complaint.
98.8  Notice of the complaint.
98.9  Investigation and findings.
98.10  Enforcement of the findings.

    Authority: Sec. 514(a) of Pub. L. 93-380, 88 Stat. 574 (20 U.S.C. 
1232h(a)); sec. 1250 of Pub. L. 95-561, 92 Stat. 2355-2356 (20 U.S.C. 
1232h(b)); and sec. 408(a)(1) of Pub. L. 90-247, 88 Stat. 559-560, as 
amended (20 U.S.C. 1221e-3(a)(1)); sec. 414(a) of Pub. L. 96-88, 93 
Stat. 685 (20 U.S.C. 3474(a)), unless otherwise noted.

    Source: 49 FR 35321, Sept. 6, 1984, unless otherwise noted.



Sec. 98.1  Applicability of part.

    This part applies to any program administered by the Secretary of 
Education that:
    (a)(1) Was transferred to the Department by the Department of 
Education Organization Act (DEOA); and
    (2) Was administered by the Education Division of the Department of 
Health, Education, and Welfare on the day before the effective date of 
the DEOA; or
    (b) Was enacted after the effective date of the DEOA, unless the law 
enacting the new Federal program has the effect of making section 439 of 
the General Education Provisions Act inapplicable.
    (c) The following chart lists the funded programs to which part 98 
does not apply as of February 16, 1984.

[[Page 254]]



------------------------------------------------------------------------
                                      Authorizing        Implementing
         Name of program                statute           regulations
------------------------------------------------------------------------
1. High School Equivalency        Section 418A of     part 206.
 Program and College Assistance    the Higher
 Migrant Program.                  Education Act of
                                   1965 as amended
                                   by the Education
                                   Amendments of
                                   1980 (Pub. L. 96-
                                   374) 20 U.S.C.
                                   1070d-2).
2. Programs administered by the   The Rehabilitation  parts 351-356,
 Commissioner of the               Act of 1973 as      361, 362, 365,
 Rehabilitative Services           amended by Pub.     366, 369-375,
 Administration.                   L. 95-602 (29       378, 379, 385-
                                   U.S.C. 700, et      390, and 395.
                                   seq.).
3. College housing..............  Title IV of the     part 614.
                                   Housing Act of
                                   1950 as amended
                                   (12 U.S.C. 1749,
                                   et seq.).
------------------------------------------------------------------------


(Authority: 20 U.S.C. 1221e-3(a)(1), 1230, 1232h, 3487, 3507)



Sec. 98.2  Definitions.

    (a) The following terms used in this part are defined in 34 CFR part 
77; ``Department,'' ``Recipient,'' ``Secretary.''
    (b) The following definitions apply to this part:
    Act means the General Education Provisions Act.
    Office means the information and investigation office specified in 
Sec. 98.5.

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



Sec. 98.3  Access to instructional material used in a research or
experimentation program.

    (a) All instructional material--including teachers' manuals, films, 
tapes, or other supplementary instructional material--which will be used 
in connection with any research or experimentation program or project 
shall be available for inspection by the parents or guardians of the 
children engaged in such program or project.
    (b) For the purpose of this part research or experimentation program 
or project means any program or project in any program under Sec. 98.1 
(a) or (b) that is designed to explore or develop new or unproven 
teaching methods or techniques.
    (c) For the purpose of the section children means persons not above 
age 21 who are enrolled in a program under Sec. 98.1 (a) or (b) not 
above the elementary or secondary education level, as determined under 
State law.

(Authority: 20 U.S.C. 1221e-3(a)(1), 1232h(a))



Sec. 98.4  Protection of students' privacy in examination, testing,
or treatment.

    (a) No student shall be required, as part of any program specified 
in Sec. 98.1 (a) or (b), to submit without prior consent to psychiatric 
examination, testing, or treatment, or psychological examination, 
testing, or treatment, in which the primary purpose is to reveal 
information concerning one or more of the following:
    (1) Political affiliations;
    (2) Mental and psychological problems potentially embarrassing to 
the student or his or her family;
    (3) Sex behavior and attitudes;
    (4) Illegal, anti-social, self-incriminating and demeaning behavior;
    (5) Critical appraisals of other individuals with whom the student 
has close family relationships;
    (6) Legally recognized privileged and analogous relationships, such 
as those of lawyers, physicians, and ministers; or
    (7) Income, other than that required by law to determine eligibility 
for participation in a program or for receiving financial assistance 
under a program.
    (b) As used in paragraph (a) of this section, prior consent means:
    (1) Prior consent of the student, if the student is an adult or 
emancipated minor; or
    (2) Prior written consent of the parent or guardian, if the student 
is an unemancipated minor.
    (c) As used in paragraph (a) of this section:
    (1) Psychiatric or psychological examination or test means a method 
of obtaining information, including a group activity, that is not 
directly related to academic instruction and that is designed to elicit 
information about attitudes, habits, traits, opinions, beliefs or 
feelings; and
    (2) Psychiatric or psychological treatment means an activity 
involving the planned, systematic use of methods or techniques that are 
not directly related to academic instruction and that

[[Page 255]]

is designed to affect behavioral, emotional, or attitudinal 
characteristics of an individual or group.

(Authority: 20 U.S.C. 1232h(b))



Sec. 98.5  Information and investigation office.

    (a) The Secretary has designated an office to provide information 
about the requirements of section 439 of the Act, and to investigate, 
process, and review complaints that may be filed concerning alleged 
violations of the provisions of the section.
    (b) The following is the name and address of the office designated 
under paragraph (a) of this section: Family Educational Rights and 
Privacy Act Office, U.S. Department of Education, 400 Maryland Avenue, 
SW., Washington, DC 20202.

(Authority: 20 U.S.C. 1231e-3(a)(1), 1232h)



Sec. 98.6  Reports.

    The Secretary may require the recipient to submit reports containing 
information necessary to resolve complaints under section 439 of the Act 
and the regulations in this part.

(Authority: 20 U.S.C. 1221e-3(a)(1), 1232h)



Sec. 98.7  Filing a complaint.

    (a) Only a student or a parent or guardian of a student directly 
affected by a violation under Section 439 of the Act may file a 
complaint under this part. The complaint must be submitted in writing to 
the Office.
    (b) The complaint filed under paragraph (a) of this section must--
    (1) Contain specific allegations of fact giving reasonable cause to 
believe that a violation of either Sec. 98.3 or Sec. 98.4 exists; and
    (2) Include evidence of attempted resolution of the complaint at the 
local level (and at the State level if a State complaint resolution 
process exists), including the names of local and State officials 
contacted and significant dates in the attempted resolution process.
    (c) The Office investigates each complaint which the Office receives 
that meets the requirements of this section to determine whether the 
recipient or contractor failed to comply with the provisions of section 
439 of the Act.

(Approved by the Office of Management and Budget under control number 
1880-0507)

(Authority: 20 U.S.C. 1221e-3(a)(1), 1232h)



Sec. 98.8  Notice of the complaint.

    (a) If the Office receives a complaint that meets the requirements 
of Sec. 98.7, it provides written notification to the complainant and 
the recipient or contractor against which the violation has been alleged 
that the complaint has been received.
    (b) The notice to the recipient or contractor under paragraph (a) of 
this section must:
    (1) Include the substance of the alleged violation; and
    (2) Inform the recipient or contractor that the Office will 
investigate the complaint and that the recipient or contractor may 
submit a written response to the complaint.

(Authority: 20 U.S.C. 1221e-3(A)(1), 1232h)



Sec. 98.9  Investigation and findings.

    (a) The Office may permit the parties to submit further written or 
oral arguments or information.
    (b) Following its investigations, the Office provides to the 
complainant and recipient or contractor written notice of its findings 
and the basis for its findings.
    (c) If the Office finds that the recipient or contractor has not 
complied with section 439 of the Act, the Office includes in its notice 
under paragraph (b) of this section:
    (1) A statement of the specific steps that the Secretary recommends 
the recipient or contractor take to comply; and
    (2) Provides a reasonable period of time, given all of the 
circumstances of the case, during which the recipient or contractor may 
comply voluntarily.

(Authority: 20 U.S.C. 1221e-3(a)(1), 1232h)



Sec. 98.10  Enforcement of the findings.

    (a) If the recipient or contractor does not comply during the period 
of time set under Sec. 98.9(c), the Secretary may either:

[[Page 256]]

    (1) For a recipient, take an action authorized under 34 CFR part 78, 
including:
    (i) Issuing a notice of intent to terminate funds under 34 CFR 
78.21;
    (ii) Issuing a notice to withhold funds under 34 CFR 78.21, 
200.94(b), or 298.45(b), depending upon the applicable program under 
which the notice is issued; or
    (iii) Issuing a notice to cease and desist under 34 CFR 78.31, 
200.94(c) or 298.45(c), depending upon the program under which the 
notice is issued; or
    (2) For a contractor, direct the contracting officer to take an 
appropriate action authorized under the Federal Acquisition Regulations, 
including either:
    (i) Issuing a notice to suspend operations under 48 CFR 12.5; or
    (ii) Issuing a notice to terminate for default, either in whole or 
in part under 48 CFR 49.102.
    (b) If, after an investigation under Sec. 98.9, the Secretary finds 
that a recipient or contractor has complied voluntarily with section 439 
of the Act, the Secretary provides the complainant and the recipient or 
contractor written notice of the decision and the basis for the 
decision.

(Authority: 20 U.S.C. 1221e-3(a)(1), 1232h)



PART 99_FAMILY EDUCATIONAL RIGHTS AND PRIVACY--Table of Contents



                            Subpart A_General

Sec.
99.1  To which educational agencies or institutions do these regulations 
          apply?
99.2  What is the purpose of these regulations?
99.3  What definitions apply to these regulations?
99.4  What are the rights of parents?
99.5  What are the rights of students?
99.6  [Reserved]
99.7  What must an educational agency or institution include in its 
          annual notification?
99.8  What provisions apply to records of a law enforcement unit?

  Subpart B_What Are the Rights of Inspection and Review of Education 
                                Records?

99.10  What rights exist for a parent or eligible student to inspect and 
          review education records?
99.11  May an educational agency or institution charge a fee for copies 
          of education records?
99.12  What limitations exist on the right to inspect and review 
          records?

    Subpart C_What Are the Procedures for Amending Education Records?

99.20  How can a parent or eligible student request amendment of the 
          student's education records?
99.21  Under what conditions does a parent or eligible student have the 
          right to a hearing?
99.22  What minimum requirements exist for the conduct of a hearing?

 Subpart D_May an Educational Agency or Institution Disclose Personally 
            Identifiable Information From Education Records?

99.30  Under what conditions is prior consent required to disclose 
          information?
99.31  Under what conditions is prior consent not required to disclose 
          information?
99.32  What recordkeeping requirements exist concerning requests and 
          disclosures?
99.33  What limitations apply to the redisclosure of information?
99.34  What conditions apply to disclosure of information to other 
          educational agencies or institutions?
99.35  What conditions apply to disclosure of information for Federal or 
          State program purposes?
99.36  What conditions apply to disclosure of information in health and 
          safety emergencies?
99.37  What conditions apply to disclosing directory information?
99.38  What conditions apply to disclosure of information as permitted 
          by State statute adopted after November 19, 1974, concerning 
          the juvenile justice system?
99.39  What definitions apply to the nonconsensual disclosure of records 
          by postsecondary educational institutions in connection with 
          disciplinary proceedings concerning crimes of violence or non-
          forcible sex offenses?

             Subpart E_What Are the Enforcement Procedures?

99.60  What functions has the Secretary delegated to the Office and to 
          the Office of Administrative Law Judges?
99.61  What responsibility does an educational agency or institution, a 
          recipient of Department funds, or a third party outside of an 
          educational agency or institution have concerning conflict 
          with State or local laws?

[[Page 257]]

99.62  What information must an educational agency or institution or 
          other recipient of Department funds submit to the Office?
99.63  Where are complaints filed?
99.64  What is the investigation procedure?
99.65  What is the content of the notice of investigation issued by the 
          Office?
99.66  What are the responsibilities of the Office in the enforcement 
          process?
99.67  How does the Secretary enforce decisions?

Appendix A to Part 99--Crimes of Violence Definitions

    Authority: 20 U.S.C. 1232g, unless otherwise noted.

    Source: 53 FR 11943, Apr. 11, 1988, unless otherwise noted.



                            Subpart A_General



Sec. 99.1  To which educational agencies or institutions do these 
regulations apply?

    (a) Except as otherwise noted in Sec. 99.10, this part applies to an 
educational agency or institution to which funds have been made 
available under any program administered by the Secretary, if--
    (1) The educational institution provides educational services or 
instruction, or both, to students; or
    (2) The educational agency is authorized to direct and control 
public elementary or secondary, or postsecondary educational 
institutions.
    (b) This part does not apply to an educational agency or institution 
solely because students attending that agency or institution receive 
non-monetary benefits under a program referenced in paragraph (a) of 
this section, if no funds under that program are made available to the 
agency or institution.
    (c) The Secretary considers funds to be made available to an 
educational agency or institution of funds under one or more of the 
programs referenced in paragraph (a) of this section--
    (1) Are provided to the agency or institution by grant, cooperative 
agreement, contract, subgrant, or subcontract; or
    (2) Are provided to students attending the agency or institution and 
the funds may be paid to the agency or institution by those students for 
educational purposes, such as under the Pell Grant Program and the 
Guaranteed Student Loan Program (titles IV-A-1 and IV-B, respectively, 
of the Higher Education Act of 1965, as amended).
    (d) If an educational agency or institution receives funds under one 
or more of the programs covered by this section, the regulations in this 
part apply to the recipient as a whole, including each of its components 
(such as a department within a university).

(Authority: 20 U.S.C. 1232g)

[53 FR 11943, Apr. 11, 1988, as amended at 61 FR 59295, Nov. 21, 1996; 
65 FR 41852, July 6, 2000]



Sec. 99.2  What is the purpose of these regulations?

    The purpose of this part is to set out requirements for the 
protection of privacy of parents and students under section 444 of the 
General Education Provisions Act, as amended.

(Authority: 20 U.S.C. 1232g)

    Note to Sec. 99.2: 34 CFR 300.610 through 300.626 contain 
requirements regarding the confidentiality of information relating to 
children with disabilities who receive evaluations, services or other 
benefits under Part B of the Individuals with Disabilities Education Act 
(IDEA). 34 CFR 303.402 and 303.460 identify the confidentiality of 
information requirements regarding children and infants and toddlers 
with disabilities and their families who receive evaluations, services, 
or other benefits under Part C of IDEA. 34 CFR 300.610 through 300.627 
contain the confidentiality of information requirements that apply to 
personally identifiable data, information, and records collected or 
maintained pursuant to Part B of the IDEA.

[53 FR 11943, Apr. 11, 1988, as amended at 61 FR 59295, Nov. 21, 1996; 
73 FR 74851, Dec. 9, 2008]



Sec. 99.3  What definitions apply to these regulations?

    The following definitions apply to this part:
    Act means the Family Educational Rights and Privacy Act of 1974, as 
amended, enacted as section 444 of the General Education Provisions Act.

(Authority: 20 U.S.C. 1232g)

    Attendance includes, but is not limited to--

[[Page 258]]

    (a) Attendance in person or by paper correspondence, 
videoconference, satellite, Internet, or other electronic information 
and telecommunications technologies for students who are not physically 
present in the classroom; and
    (b) The period during which a person is working under a work-study 
program.


(Authority: 20 U.S.C. 1232g)

    Authorized representative means any entity or individual designated 
by a State or local educational authority or an agency headed by an 
official listed in Sec. 99.31(a)(3) to conduct--with respect to Federal- 
or State-supported education programs--any audit or evaluation, or any 
compliance or enforcement activity in connection with Federal legal 
requirements that relate to these programs.

(Authority: 20 U.S.C. 1232g(b)(1)(C), (b)(3), and (b)(5))

    Biometric record, as used in the definition of personally 
identifiable information, means a record of one or more measurable 
biological or behavioral characteristics that can be used for automated 
recognition of an individual. Examples include fingerprints; retina and 
iris patterns; voiceprints; DNA sequence; f