[Federal Register: July 3, 2000 (Volume 65, Number 128)]
[Page 41061-41062]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]



Office of Vocational and Adult Education; Intent To Repay the 
Commonwealth of Massachusetts Department of Education Funds Recovered 
as a Result of a Final Audit Determination

AGENCY: Department of Education.

ACTION: Notice of intent to award grantback funds.


SUMMARY: Under section 459 of the General Education Provisions Act 
(GEPA), 20 U.S.C. 1234h, the Secretary of Education (Secretary) intends 
to repay to the Commonwealth of Massachusetts Department of Education 
(Massachusetts), under a grantback arrangement, an amount equal to 75 
percent of the principal amount of funds recovered by the U.S. 
Department of Education (Department) as a result of the final audit 
determination in this matter (ACN: 01-33145G). The Department's 
recovery of funds followed the settlement reached between the parties 
under which Massachusetts refunded $2,111,810 to the Department in full 
resolution of the Department's final audit determination for State 
fiscal year (FY) 1992. This notice describes Massachusetts' plan for 
the use of the repaid funds and the terms and conditions under which 
the Secretary intends to make those funds available. This notice 
invites comments on the proposed grantback.

DATES: All comments must be received on or before August 2, 2000.

ADDRESSES: All written comments should be addressed to Ron Castaldi, 
Chief, Division of Vocational-Technical Education, Office of Vocational 
and Adult Education, U.S. Department of Education, 400 Maryland Avenue 
SW, Mary E. Switzer Building, Room 4317, MS 7323, Washington, DC 20202.

FOR FURTHER INFORMATION CONTACT: Ron Castaldi. Telephone: (202) 205-
9444. If you use a telecommunications device for the deaf (TDD), you 
may call the Federal Information Relay Service (FIRS) at 1-800-877-


A. Background

    Under the settlement agreement between the Department and the 
Commonwealth of Massachusetts, the Department recovered $2,111,810 from 
Massachusetts in full resolution of all claims arising from an audit of 
Massachusetts covering FY 1992 (ACN: 01-33145G).
    The Department's original claim of $4,604,211 was contained in a 
program determination letter (PDL) issued by the Assistant Secretary 
for Vocational and Adult Education on March 31, 1995. This claim arose 
from findings related to Massachusetts' administration of its 
vocational education program under the provisions of the Carl D. 
Perkins Vocational and Applied Technology Education Act. 20 U.S.C. 2301 
et seq. (1988) (Perkins II).
    In the March 31, 1995 PDL, the Assistant Secretary determined that 
Massachusetts violated the Federal requirements governing maintenance 
of fiscal effort. Specifically, the Assistant Secretary concluded that 
Massachusetts failed to expend non-Federal funds at an appropriate 
level to maintain fiscal effort on either an aggregate or per pupil 
basis, thus violating section 502(a) of Perkins II (20 U.S.C. 2463(a)).
    The settlement negotiations resulting from Massachusetts' appeal of 
the Assistant Secretary's March 31, 1995 PDL culminated in a settlement 
agreement for a total repayment of a principal amount of $2,111,810. 
The settlement agreement was executed on August 15, 1997. The 
Department received full payment for this determination in September 

B. Authority for Awarding a Grantback

    Section 459(a) of GEPA, 20 U.S.C. 1234h(a), provides that whenever 
the Secretary has recovered funds following a final audit determination 
with respect to any applicable program, the Secretary may consider 
those funds to be additional funds available for the program and may 
arrange to repay to the State or local educational agency affected by 
that determination an amount not to exceed 75 percent of the recovered 
funds. The Secretary may enter into this grantback arrangement if the 
Secretary determines that--
    (1) The practices or procedures of the recipient that resulted in 
the violation of law have been corrected, and that the recipient is in 
all other respects in compliance with the requirements of that program;
    (2) The recipient has submitted to the Secretary a plan for the use 
of those funds pursuant to the requirements of that program and, to the 
extent possible, for the benefit of the population that was affected by 
the failure to comply or by the misuse of funds that resulted in the 
recovery; and
    (3) The use of the funds in accordance with that plan would serve 
to achieve the purposes of the program under which the funds were 
originally paid.

C. Plan for Use of Funds Awarded Under a Grantback Arrangement

    Pursuant to section 459(a)(2) of GEPA, Massachusetts has applied 
for a grantback of $1,583,858, or 75 percent of the $2,111,810 repaid 
to the Department under the settlement agreement, and has submitted a 
plan for use of the proposed grantback funds, consistent with the Carl 
D. Perkins Vocational and Technical Education Act of 1998 (Perkins 
III), which is the successor statute to Perkins II and is currently in 
effect. Massachusetts plans to establish new career and technical 
education programs in high-wage, high-demand emerging career fields 
where there is a critical shortage of skilled workers, and to assist 
existing career and technical programs seeking national program 
    Specifically, Massachusetts plans to utilize the requested 
grantback funds, totaling $1,583,858, to offer a competitive Request 
for Proposal for Perkins-eligible secondary schools with career and 
technical programs. Funds will be used either to begin a career and 
technical education program in a new and emerging field, or to update 
an existing program using the National Program Standards as a 
framework. The award of grants will be weighed in favor of schools with 
a higher concentration

[[Page 41062]]

of special populations. Massachusetts expects to award 20-25 grants 
ranging from $50,000 to $100,000 each. Grant recipients will be 
required to match on a dollar for dollar basis the total grant request 
from State, local, business and industry, or other non-Perkins Federal 
funding source. The Request for Proposal will include a stipulation 
that schools include enrollment figures for new proposed programs or 
grant-impacted programs, and also include the number of students who 
are members of special populations. Grant funds awarded under this 
Request for Proposal cannot be used to supplant activities that are 
currently being funded.

D. The Secretary's Determination

    The Secretary has carefully reviewed the plan submitted by 
Massachusetts and other relevant documentation. Based upon that review, 
the Secretary has determined that the conditions under section 459 of 
GEPA have been met.
    This determination is based upon the best information available to 
the Secretary at the present time. If this information is not accurate 
or complete, the Secretary is not precluded from taking appropriate 
administrative action at a later date. In finding that the conditions 
of section 459 of GEPA have been met, the Secretary makes no 
determination concerning any pending audit recommendations or final 
audit determinations.

E. Notice of the Secretary's Intent To Enter Into a Grantback 

    Section 459(d) of GEPA requires that, at least 30 days before 
entering into an arrangement to award funds under a grantback, the 
Secretary must publish in the Federal Register a notice of intent to do 
so, and the terms and conditions under which the payment will be made.
    In accordance with section 459(d) of GEPA, notice is hereby given 
that the Secretary intends to make funds available to the Massachusetts 
Department of Education under a grantback arrangement. The grantback 
award would be in the amount of $1,583,858, which is 75 percent--the 
maximum percentage authorized by the statute--of the principal 
recovered by the Department as a result of the final audit 
determination and the settlement in this matter.

F. Terms and Conditions Under Which Payments Under a Grantback 
Arrangement Would Be Made

    Massachusetts agrees to comply with the following terms and 
conditions under which payment under a grantback arrangement would be 
    (1) Massachusetts will expend the funds awarded under the grantback 
in accordance with--
    (a) All applicable statutory and regulatory requirements;
    (b) The plan that was submitted and any amendments to the plan that 
are approved in advance by the Secretary; and
    (c) The budget that was submitted with the plan and any amendments 
to the budget that are approved in advance by the Secretary.
    (2) All funds received under the grantback arrangement must be 
obligated by September 30, 2000, for ACN: 01-33145G, in accordance with 
section 459(c) of GEPA and Massachusetts' plan.
    (3) Massachusetts will, no later than January 1, 2002, submit a 
report to the Secretary which--
    (a) Indicates that the funds awarded under the grantback have been 
expended in accordance with the proposed plan and approved budget; and
    (b) Describes the results and effectiveness of the project for 
which the funds were spent.
    (4) Separate accounting records must be maintained documenting the 
expenditures of funds awarded under the grantback arrangement.

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(Catalog of Federal Domestic Assistance Number 84.048, Basic State 
Grants for Vocational Education)

    Dated: June 28, 2000.
Patricia W. McNeil,
Assistant Secretary for Vocational and Adult Education.

[FR Doc. 00 16750 6-30-; 8:45 am]