Agreement

This Agreement is entered into by the Florida Department of Education (Florida) and the U.S. Department of Education (Department) as part of the Department's Cooperative Audit Resolution and Oversight Initiative (CAROI), to resolve issues relating to Florida's compliance with Federal record keeping requirements for employees with multi-program responsibilities who were paid with Federal funds awarded under the Carl D. Perkins Vocational and Applied Technology Education Act (Perkins Act). This Agreement fully resolves the disallowance contained in Enclosure No. 3, Finding No. 4, of the October 18, 1994, program determination letter (PDL) issued by the Assistant Secretary for Vocational and Adult Education (Assistant Secretary), pending before the Department's Office of Administrative Law Judges (OALJ) in Docket No. 94-178-R (ACN: 04-33137G), as well as the monetary determinations pertaining to the findings at pages 2-205 through 2-207 of the Florida Statewide Audit covering the period July 1, 1993, through June 30, 1994, (ACN: 04-53670) and the finding contained at pages 314 through 317 of the Florida Statewide Audit covering the period July 1, 1992, through June 30, 1993 (ACN: 04-43134G) and for any vocational education and adult education time distribution audit finding(s) for the period July 1, 1994, through June 30, 1995. In the October 18, 1994, PDL, the Assistant Secretary disallowed $117,256.43 in Federal funds expended by Florida for salaries and benefits paid with Perkins Act funds in the period between July 1, 1991, and June 30, 1992.

The Department and Florida hereby agree to the following terms and conditions in full resolution of the above-referenced issues pertaining to Florida's compliance with time distribution requirements applicable to Federal vocational education and adult education funds, including the monetary claim in the October 18, 1994, PDL, and the other above-mentioned pending vocational education and adult education time distribution audit findings for periods prior to July 1, 1995.

1. Florida will adopt and implement a substitute time distribution reporting system ("substitute system") for allocating salaries and wages to Federal awards pursuant to, and consistent with, the revised Office of Management and Budget (OMB) Circular A-87, dated May 17, 1995, (as adopted by the Department on September 29, 1995; 60 Fed. Reg. 50413) as set forth in Exhibit 1 to this Agreement. The Department hereby certifies that the substitute system set forth in Exhibit 1 is consistent with the revised OMB Circular A-87, Attachment B, at section 11.h.(6)(c).

2. Florida will begin training and development towards implementation of its substitute system upon execution of this Agreement, with full implementation of the substitute system to begin by July 1, 1996.

3. Based on the documentation submitted by Florida during the course of its appeal before the OALJ, and based upon this Agreement, the Assistant Secretary hereby withdraws her claim for recovery of the $117, 256.43 sought in the PDL pending before the OALJ in Docket No 94-178-R.

4. In addition, the Assistant Secretary will not seek monetary recovery for the additional above-mentioned vocational education and adult education time distribution findings contained in the Florida Statewide Audits from fiscal years 1993 through 1995.

5. If requested by Florida, the Department will provide technical assistance, as appropriate and as resources permit, to assist Florida with implementation of its substitute system.

6. In the event that Florida fails to comply in the first two years (July 1, 1996 - June 30, 1998) with the terms of this Agreement, paragraph 4 of this Agreement is null and void and the Assistant Secretary may pursue the funds related to fiscal years 1993 through 1995 time distribution audit findings.

7. Florida may submit a request in the future to revise the substitute system that is set forth as Exhibit 1 to this Agreement. The Department will determine whether the request is consistent with OMB Circular A-87. The Department may also submit a request to Florida to revise the substitute system outlined in this Agreement. The parties may revise or terminate this Agreement, including the substitute system, at any time upon mutual agreement. After June 30, 1998, however, either party may terminate this Agreement thirty days after written notice to the other party.

8. The provisions of this Agreement do not in any way restrict any other remedy or remedies available to the Department should Florida fail to comply with any of the terms of this Agreement, including the substitute system set forth in Exhibit 1, or any statutory or regulatory requirement relating to any program administered by this Department.

9. This Agreement does not constitute either an admission of liability on the part of Florida, or an admission of error on the part of the Department with respect to any audit claim or finding.

10. Within seven (7) working days following the Execution Date of this Agreement, the parties to this proceeding in the OALJ case will submit to the OALJ a joint motion for dismissal with prejudice of the appeal in OALJ Docket No. 94-178-R.

11. Each party will bear its own costs and legal fees relating to the administrative proceeding before the OALJ in OALJ Docket No. 94-178-R.