FR Doc E9-7036[Federal Register: March 30, 2009 (Volume 74, Number 59)]
[Page 14109-14112]
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Intent To Repay to the Northwest Indian College Funds Recovered 
as a Result of a Final Audit Determination

AGENCY: Department of Education.

ACTION: Notice of intent to award grantback funds.


    Education (Secretary) intends to repay to the Northwest Indian 
College (NWIC) an amount that represents approximately 57 percent of 
the amount of funds recovered by the Department of Education 
(Department) as a result of final audit determinations for audit 
findings covering fiscal years 1999-2001. The Department's recovery of 
funds followed resolution of the audit disallowances identified in a 
September 30, 2004 Program Determination Letter (PDL) issued by the 
Office of Vocational and Adult Education (OVAE) for the period of July 
1, 1999 through November 26, 2001. The PDL sought recovery of $316,096. 
On December 1, 2004, NWIC appealed the monetary findings in the 
September 30, 2004 PDL to the Department's Office of the Administrative 
Law Judges (OALJ). Following discussions and exchanges of information 
between the parties, on March 27, 2006, the parties entered into a 
Repayment Agreement (Agreement) that fully resolved the issues in the 
proceeding and under which NWIC agreed to repay the Department 
$316,096. The NWIC has repaid the full amount in accordance with the 
    This notice describes NWIC's plan for the use of a portion of the 
repaid funds and the terms and conditions under which the Secretary 
intends to make grantback funds available to NWIC.
    This notice invites comments on the proposed grantback.

DATES: We must receive your comments on or before April 29, 2009.

[[Page 14110]]

ADDRESS: All written comments concerning the proposed grantback should 
be addressed to Gwen Washington, U.S. Department of Education, 400 
Maryland Avenue, SW., room 11076, Potomac Center Plaza (PCP), 
Washington, DC 20202-7241. If you prefer to send your comments through 
the internet, use the following address: You 
must include the term ``Northwest Indian College Grantback'' in the 
subject line of your electronic message.

FOR FURTHER INFORMATION CONTACT: Gwen Washington. Telephone: (202) 245-
7790. Fax: (202) 245-7170 or by e-mail:
    If you use a telecommunications device for the deaf (TDD), call the 
Federal Relay Service (FRS) toll free, at 1-800-877-8339.
    Individuals with disabilities can obtain a copy of this notice in 
an accessible format (e.g., Braille, large print, audiotape, or 
computer diskette) by contacting the person listed in this section.

SUPPLEMENTARY INFORMATION: Invitation to Comment: We invite you to 
submit comments regarding this notice. To ensure that your comments 
have maximum effect on the Secretary's decision regarding awarding this 
grantback, we urge you to identify clearly the specific proposal that 
each comment addresses.
    During and after the comment period, you may inspect all public 
comments about this notice in room 11076, 550 12th Street, SW., 
Washington, DC, between the hours of 8:30 a.m. and 4:00 p.m., 
Washington, DC time, Monday through Friday of each week except Federal 
    Assistance to Individuals with Disabilities in Reviewing the 
Rulemaking Record: On request, we will provide an appropriate 
accommodation or auxiliary aid to an individual with a disability who 
needs assistance to review the comments or other documents in the 
public rulemaking record for this notice. If you want to schedule an 
appointment for this type of accommodation or auxiliary aid, please 
contact the person listed under FOR FURTHER INFORMATION CONTACT.

A. Background

    Under the terms of a March 27, 2006 Repayment Agreement between the 
Department and NWIC, the Department recovered a total of $316,096 from 
NWIC following resolution of audit findings contained in an audit 
report issued by the Department's Office of Inspector General (OIG) 
covering audit periods July 1, 1999 through June 30, 2001 and October 
1, 1999 through November 26, 2001 (Audit Control Number ED-OIG/A09-
C0026). Prior to entering into the Agreement, the Department and NWIC 
engaged in the cooperative audit resolution of the findings contained 
in the audit report in an effort to address the root causes of the 
problems and to avoid recurrence of these findings in the future. The 
OIG audit report and this grantback request involve two Department 
grants awarded under the Indian Vocational Education Program (IVEP) 
(CFDA 84.101A): a Document Imaging Specialist Certificate (DISC) grant 
and a Promising Practices grant.
    The IVEP was authorized under section 103 of the Carl D. Perkins 
Vocational and Applied Technology Education Act of 1990 (Perkins II). 
The IVEP was succeeded by the Native American Vocational and Technical 
Education Program (NAVTEP), authorized under section 116 of the Carl D. 
Perkins Vocational and Technical Education Act of 1998 (Perkins III). 
The NAVTEP was replaced by the Native American Career and Technical 
Education Program (NACTEP), authorized under section 116 of the Carl D. 
Perkins Career and Technical Education Act of 2006 (Perkins IV).

1. IVEP--DISC Grant

    Under the terms of the DISC grant, NWIC was to provide vocational 
education and training in electronic document management and document 
conversion services to unemployed and low-income members of its tribal 
service population. One finding resulting in NWIC's repayment of funds 
related to NWIC's improper awards of stipends to certain DISC students 
who were either ineligible to receive stipends or received more than 
they were eligible to receive. Moreover, section 103(b)(1)(D) of 
Perkins II and the regulations in effect when the DISC Project grant 
award was made to NWIC (34 CFR 401 (1999)) established the conditions 
under which an IVEP grantee was authorized to provide stipends to 
students. The Department determined that NWIC had used its IVEP grant 
to pay stipends in a manner inconsistent with Perkins II and its 
implementing regulations. The stipend finding resulted in the 
Department's claim for recovery of $150,670.

2. IVEP--Promising Practices Grant

    Under the Promising Practices grant, NWIC was required to survey, 
assemble, and distribute best practices in the use of technology on 
projects funded by the IVEP. Required deliverables included:
     A survey instrument developed in consultation with OVAE 
     Identification of eight promising practices sites;
     Manuals summarizing practices for all IVEP projects;
     A list of contacts at each IVEP project who were 
responsible for technology; and
     A presentation at an annual project directors' meeting for 
IVEP grantees.
    NWIC failed to complete most of the activities it had committed to 
completing under the grant and failed to provide required products and 
deliverables. The products and deliverables and the draft documents 
that NWIC provided to the Department contained no comprehensive 
discussion of survey findings, and the case studies on the selected 
sites were not prepared. In addition, the quality of products and 
deliverables that NWIC did prepare under the Promising Practices 
project had been severely compromised because NWIC had not used a panel 
of experts to select the sites of Promising Practices and because NWIC 
had not identified the criteria or standards it had used to select 
Promising Practices sites. Moreover, although required to do so under 
the terms of the Promising Practices grant, NWIC did not produce any 
Promising Practices manuals.
    Because NWIC did not deliver the agreed-upon products and manuals 
proposed in its approved grant, neither the Department nor its NAVTEP 
grantees benefited from the information on best practices in the use of 
technology, and the Department was denied a resource for providing 
technical assistance to future NAVTEP grantees. Based on NWIC's failure 
to deliver products and deliverables under the Promising Practices 
grant, the Department sought repayment of $57,800.

3. DISC and Promising Practices Grants Unsupported Costs

    The Department also sought recovery of $107,626 due to NWIC's 
charging of unreasonable and unallowable charges to both the DISC and 
the Promising Practices grants and because NWIC lacked the required 
supporting documentation for certain transactions under both grants.
    Under the terms of the Agreement between the Department and NWIC, 
NWIC has repaid to the Department the full $316,096 and established the 
necessary managerial and financial systems needed to provide oversight 
of institutional and grant resources. NWIC is requesting approval of a 
grantback in the amount of $179,855, which is

[[Page 14111]]

approximately 57 percent of the amount it repaid to the Department.

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 under an applicable program because 
the recipient made an expenditure of funds that was not allowable, the 
Secretary may consider those funds to be additional funds available for 
the program and may arrange to repay to the grantee affected by that 
determination an amount not to exceed 75 percent of the recovered 
funds. The Secretary may enter into this grantback requested by NWIC if 
the Secretary determines that--
    (a) The NWIC practices and procedures that resulted in the audit 
findings in question have been corrected, and NWIC is in compliance 
with the requirements of the applicable programs;
    (b) NWIC has submitted to the Secretary a plan for the use of the 
funds to be awarded under the grantback arrangement that meets the 
requirements of the program and, to the extent possible, benefits the 
population that was affected by the failure to comply or by 
misexpenditures that resulted in the recovery; and
    (c) The use of funds to be awarded under the grantback arrangement 
in accordance with NWIC's plan would serve to achieve the purposes of 
the program under which the funds were originally granted.

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

    Pursuant to section 459(a)(2) of GEPA, NWIC has applied for a 
grantback totaling $179,855, which is approximately 57 percent of the 
principal amount of the recovered funds and has submitted a plan 
outlining the activities that NWIC would support with the grantback 
funds. Specifically, NWIC plans to utilize the grantback of funds 
recovered under the IVEP to pay costs associated with a proposed 
Digital Media and Web Technology program. As proposed, students would 
take the entire Digital Media and Web Technology program in a 20-week 
block, consisting of 10 weeks of intensive classroom instruction at the 
main NWIC Lummi campus followed immediately by 10 weeks of an 
internship and an integrated capstone project. The intensive classes 
would consist of 24 contact hours a week (six hours per day, Monday 
through Thursday). The program would provide participants who 
successfully complete the course training, an internship, and a 
capstone course with a certificate of completion. Program completers 
would receive the skills and knowledge necessary to: (1) Pass Adobe's 
Certified Associate exams in: Web Communication--using Adobe 
``Dreamweaver,'' Rich Media Communication--using Adobe ``Flash,'' and 
Visual Communication--using Adobe ``Photoshop;'' (2) obtain Adobe 
Certified Associate certifications in one or more of those Adobe 
applications; and (3) subsequently obtain high-quality employment in 
the field of digital media. It is important to note that the proposed 
new certification program does not supplant non-Federal funds already 
available to NWIC.
    The proposed project would focus strongly on career and technical 
education (CTE) skill development in digital media and web technology 
and provide course content that is experiential and individually 
directed, and concludes with an internship and a capstone project. The 
capstone project has been specifically designed to integrate and assess 
the skills developed in the courses taught during the first 10 weeks of 
the Digital Media and Web Technology program. Students would be 
expected to demonstrate mastery of the Adobe Certified Associate skills 
through a capstone project presentation that reflects both their 
classroom and internship work. Together, the classroom work, 
internship, and capstone segments constitute a single coherent and 
integrated curriculum--the goal of which is to prepare students to 
master the Adobe Certified Associate skills, receive an Award of 
Completion, pass the Certified Adobe Associate exam, and gain 
successful employment.
    Funding for the program would support: (1) limited pre-award costs 
for recruiting students who are academically prepared to benefit from 
the intensive Digital Media and Web Technology program, and (2) 
implementation costs, including salaries for the project director and 
classroom instructors, costs of supervising and advising students, and 
employment placement costs, through September 30, 2009. In its 
grantback request, NWIC has stated that a total of 32 students, equally 
divided between two cycles, would participate in the program with an 
expected job placement rate of 85 percent within six months of program 
completion. The proposed Digital Media and Web Technology program is a 
CTE program using Adobe software and incorporating all of the learning 
objectives identified by Adobe for the Adobe Certified Associate 
programs: Web Communication Using Adobe ``Dreamweaver,'' Rich Media 
Communication Using Adobe ``Flash,'' and Visual Communication using 
Adobe ``Photoshop.'' The Digital Media and Web Technology program will 
prepare students to enter their chosen disciplines upon completion of 
the program. As part of the program, NWIC plans to provide 
opportunities for students to practice taking the Adobe Certified 
Associate exams and expects to administer the exams after the 
completion of each of the two training cycles. NWIC proposes that exam 
preparation and testing would be fully integrated into the Digital 
Media and Web Technology program. In addition, NWIC will identify and 
recruit potential students in an effort to be fully prepared to start 
training the first cohort of students by late April or early May 2009, 
if a grantback is awarded.
    NWIC has designed this program to be sustainable after completion 
of the two cycles, allowing NWIC to continue to deliver a Digital Media 
and Web Technology program on an ongoing basis once Federal grantback 
funds are no longer available. NWIC notes in its grantback request that 
the proposed Digital Media and Web Technology program broadens its 
technical offerings into areas that are in demand both within tribal 
communities and throughout the Pacific Northwest. NWIC is hopeful that 
the Digital Media and Web Technology program will provide attractive 
long-term employment opportunities, because it will emphasize 
marketing, recruiting, internship, and placement activities to a 
greater extent than does NWIC's current computer technology 
programming. It is NWIC's intention that these activities and their 
benefits would continue beyond the proposed project time frame and 
would increase the reach and sustainability of NWIC's computer and 
technology educational programming. Additionally, preparing NWIC 
students to pass the Adobe Certified Associate exams would prepare 
those students for nationally recognized certifications thereby further 
broadening their employment options.

D. The Secretary's Determinations

    The Secretary has carefully reviewed the plan submitted by NWIC. 
Based upon that review, the Secretary has determined that the 
conditions under section 459(a) 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. In finding that the conditions of section 459(a) 
of GEPA have been met, the Secretary makes no determination concerning 
any pending audit

[[Page 14112]]

recommendations or final audit determinations.
    The Secretary also has concluded that, to the extent possible, this 
grantback award would support the provision of services to the 
population of intended beneficiaries of the program under which the 
DISC and Promising Practices grants were originally made. The 
population of intended beneficiaries under IVEP and NAVTEP may not have 
received the full benefit of the services intended by the Perkins IVEP 
grant awards, currently NACTEP, due to the problems that gave rise to 
the audit recovery described in Section A of this notice. The Secretary 
has determined that if awarded, this grantback would advance and 
support the same policy goals and purposes of the statutory Perkins II 
provisions that authorized the initial DISC and Promising Practices 
grants and would be used in compliance with all current statutory and 
regulatory program requirements.

E. Notice of the Secretary's Intent to Enter into a Grantback 
Arrangement with NWIC

    Section 459(d) of GEPA requires that, at least 30 days before 
entering into an arrangement to award funds under a grantback, the 
Secretary publish in the Federal Register a notice of intent to do so, 
and the terms and conditions under which the payment would be made. In 
accordance with section 459(d) of GEPA, notice is hereby given that the 
Secretary intends to make funds available to NWIC under a grantback 
arrangement. The grantback award would be in the amount of $179,855, 
which is approximately 57 percent of the principal amount recovered as 
a result of the Agreement.

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

    NWIC agrees to comply with the following terms and conditions under 
which payments under a grantback arrangement would be made:
    (a) The funds awarded under the grantback must be spent in 
accordance with--
    (1) All applicable statutory and regulatory requirements;
    (2) The plan that NWIC submitted and any amendments to the plan 
that are approved in advance by the Secretary; and
    (3) The budget that NWIC submitted with the approved plan and any 
amendments to the budget that are approved in advance by the Secretary.
    (b) All funds received under the grantback arrangement must be 
obligated by NWIC by September 30, 2009, in accordance with section 
459(c) of GEPA and NWIC's approved plan.
    (c) NWIC must, no later than December 31, 2009, submit a report to 
the Secretary that--
    (1) Indicates that the funds awarded under the grantback have been 
spent in accordance with the proposed plan and any amendments that have 
been approved in advance by the Secretary; and
    (2) Describes the results and effectiveness of the project for 
which the funds were spent, including the number of students who 
enrolled in the training sessions, the number of students who received 
an Award of Completion, the number of students who took the Adobe 
exams, and the number of students who passed the exams and obtained 
Adobe certifications.
    (d) NWIC must maintain separate accounting records documenting the 
expenditures of funds awarded under the grantback arrangement.

Electronic Access to This Document

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Department published in the Federal Register, in text or Adobe Portable 
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    Note: The official version of this document is the document 
published in the Federal Register. Free Internet access to the 
official edition of the Federal Register and the Code of Federal 
Regulations is available on GPO Access at:

(Catalog of Federal Domestic Assistance Numbers: 84.101A, Native 
American Career and Technical Education Program.)

    Dated: March 25, 2009.
Dennis Berry,
Acting Assistant Secretary for Vocational and Adult Education.
[FR Doc. E9-7036 Filed 3-27-09; 8:45 am]