Laws & Guidance VOCATIONAL EDUCATION
Use of Carryover Funds Awarded under the Perkins Vocational and Applied Technology Education Act

Program Memorandum--OVAE/DVTE--99-4

Date: December 7, 1998
To: State Directors of Vocational- Technical Education
State Directors of Community, Technical and Junior Colleges
State Tech-Prep Coordinators
From: Patricia W. McNeil
Assistant Secretary for Vocational and Adult Education
Subject: Use of Carryover Funds Awarded under the Carl D. Perkins Vocational and Applied Technology Education Act

The purpose of this memorandum is to provide guidance and options regarding a State's obligation and expenditure of any grant funds awarded under the Carl D. Perkins Vocational and Applied Technology Education Act (Perkins II) that may remain available for obligation and expenditure on the effective date of its new State plan or its amended State plan. Consistent with section 4 of the Carl D. Perkins Vocational and Technical Education Act (Perkins III) and to promote the orderly transition from Perkins II to Perkins III, we are providing a State with considerable flexibility as to how it obligates these funds.

The statutory authority for the period for obligating and expending carryover funds is the so-called "Tydings Amendment," section 412(b) of the General Education Provisions Act, 20 U.S.C. 1225(b). In general, under this provision, any funds not obligated and expended during the period for which they were awarded become carryover funds and may be obligated and expended during the succeeding fiscal year. Any such carryover funds must be obligated and expended in accordance with the Federal statutory and regulatory provisions in effect during the period in which such funds are to be expended and the State plan approved for such program for this period (that is, the carryover period) rather than the requirements in effect when the funds were awarded.

FY 1998 Vocational Education Funds

Funds from a State's Fiscal Year (FY) 1998 grant (that first became available on July 1, 1997) that were not expended by September 30, 1998, became carryover funds on October 1, 1998. FY 1998 funds remain available for obligation through September 30, 1999.

A State has three options for how it and its subgrantees obligate these FY 1998 carryover funds:

  1. The State may continue to treat these carryover funds as Perkins II funds through September 30, 1999, consistent with the requirements of Perkins II, including the set-asides in section 102 of Perkins II. (This option is not available for FY 1999 carryover funds because Perkins III became effective before those funds will become carryover funds.)

  2. A State may spend FY 1998 carryover funds under the authority in Perkins III that is the same or most similar to the purpose for which the funds were reserved under section 102 of Perkins II, beginning on the date that its new State plan or its amended State plan becomes effective. For example, a State carrying over funds reserved for single parents or for sex equity under section 102(a)(2) of Perkins II could spend those funds under Perkins III in combination with funds allotted under section 112(a)(2)(B) for services to prepare individuals for nontraditional training and employment. While these carryover funds must be obligated only for specific costs that are allowable under Perkins III, these carryover funds would not be subject to the within-State spending limitations under section 112 of Perkins III.

  3. The State may begin to treat FY 1998 carryover funds as Perkins III funds on the date its new State plan or its amended State plan becomes effective (generally July 1, 1999). In this case, the State may treat these FY 1998 carryover funds as a supplemental appropriation under Perkins III. These carryover funds must be obligated only for specific costs that are allowable under Perkins III and, together with the FY 2000 grant allotment, would be subject to the within-State allocation requirements in section 112 of Perkins III. For example, a State's FY 2000 grant award under the Perkins III is $5,000,000, and the State also has $100,000 in FY 1998 carryover funds. Within this option, the State will calculate all of its within-State spending requirements under section 112 of Perkins III based on a total allotment of $5.1 million.

For either option 2 or 3 above, the State would be considered to be in compliance with the set-aside requirements in section 102 of Perkins II with respect to its FY 1998 grant as long as it had not exceeded the caps on any set-asides under section 102 of Perkins II prior to the date that its new State plan or its amended State plan becomes effective.

FY 1999 Vocational Education Funds

Funds from a State's FY 1999 grant first became available on July 1, 1998, and remain available for obligation through September 30, 2000. Although FY 1999 funds will not become carryover funds until October 1, 1999, and therefore are not required to be obligated under Perkins III until that date, a State may choose to treat available FY 1999 grant funds as Perkins III funds on the date its new State plan or its amended State plan becomes effective. In this case, a State would obligate FY 1999 funds under Perkins III and its new State plan or its amended State plan -- even before those funds will become carryover funds.

A State has two options for how it and its subgrantees obligate any FY 1999 funds, whether or not it begins to treat those funds as carryover funds before October 1, 1999:

  1. A State may spend FY 1999 funds under the authority in Perkins III that is the same or most similar to the purpose for which the funds were reserved under section 102 of Perkins II as discussed above with respect to option 2 for FY 1998 funds. While FY 1999 funds must be obligated only for specific costs that are allowable under Perkins III, under this option, these carryover funds would not be subject to the within-State spending limitations under section 112 of Perkins III.

  2. A State may treat such carryover funds as if they were a supplemental appropriation to the FY 2000 grant award as discussed above with respect to option 3 for FY 1998 funds. Under this option, the FY 1999 carryover funds along with the FY 2000 grant allotment would be subject to the within-State allocation requirements in section 112 of Perkins III.

Under either option 1 or 2 for FY 1999 carryover funds, the State would be considered to be in compliance with the set-aside requirements in section 102 of Perkins II with respect to its FY 1999 grant as long as it had not exceeded the caps on any set-asides under section 102 of Perkins II before the date its new State plan or its amended State plan becomes effective.

Regardless of which options a State chooses for FY 1998 and FY 1999 carryover funds, a State must document its choices and maintain accounting records that reflect the choices. Further, regardless of the options a State chooses, it must obligate FY 1998 funds no later than September 30, 1999, and FY 1999 funds no later than September 30, 2000. Please feel free to contact Ron Castaldi of my staff at (202) 205-9441, the electronic mailbox at OVAE@ed.gov, or our web site for any assistance you may need at: http://www.ed.gov/offices/OVAE/CTE/legis.html.


 
Print this page Printable view Send this page Share this page
Last Modified: 12/17/2004