Elementary and secondary education Impact aid programs,
[Federal Register: March 15, 2004 (Volume 69, Number 50)]
[Rules and Regulations]
[Page 12233-12240]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr15mr04-19]
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Part IV
Department of Education
Impact Aid Programs; Final Rule
Office of Elementary and Secondary Education; Overview Information; Impact Aid Discretionary Construction Program; Notice Inviting Applications for New Awards for Fiscal Years (FYs) 2003 and 2004; Notice
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DEPARTMENT OF EDUCATION
RIN 1810-AA96
Impact Aid Programs
AGENCY: Office of Elementary and Secondary Education, Department of Education.
ACTION: Final rule.
SUMMARY: The Secretary issues these final regulations to implement the Impact Aid Discretionary Construction program, which is authorized under section 8007(b) of the Elementary and Secondary Education Act of 1965 (the Act), as amended by the No Child Left Behind Act of 2001 (NCLB). The program provides competitive grants for emergency repairs and modernization of school facilities to certain eligible school districts that receive Impact Aid formula funds. These final regulations incorporate statutory requirements and provide guidance for applying and qualifying for, as well as spending, the Federal funds provided under this program. These final regulations apply to the grant competitions after fiscal year (FY) 2002.
EFFECTIVE DATE: April 14, 2004.
FOR FURTHER INFORMATION CONTACT: Marilyn Hall, Impact Aid Program, U.S. Department of Education, 400 Maryland Avenue SW., Washington, DC 20202- 6244. Telephone: (202) 260-3858 or via Internet: Impact.Aid@ed.gov.
If you use a telecommunications device for the deaf (TDD), you may call the Federal Information Relay Service (FIRS) at 1-800-877-8339.
Individuals with disabilities may obtain this document in an alternative format (e.g., Braille, large print, audiotape, or computer diskette) on request to the contact person listed under FOR FURTHER INFORMATION CONTACT.
SUPPLEMENTARY INFORMATION: These final regulations implement the Impact Aid Discretionary Construction program, which is authorized under section 8007(b) of the Act, as amended by the NCLB (Pub. L. 107-110, enacted January 8, 2002). Final regulations for the FY 2002 grant competition were published in the Federal Register on August 16, 2002.
On October 22, 2003, the Secretary published a notice of proposed rulemaking (NPRM) for this program in the Federal Register (68 FR 60598). The NPRM was similar to the final FY 2002 regulations, but we included clarifying language based on our experiences in implementing this program. These clarifications were made in Sec. Sec. 222.172, 222.173, and 222.176 of title 34 of the Code of Federal Regulations.
The purpose of the Impact Aid Discretionary Construction program is to assist certain eligible Impact Aid school districts in meeting the emergency or modernization needs of their school facilities. In the preamble to the NPRM, the Secretary summarized and discussed on pages 60598 and 60599 the substantive issues under the sections of the regulations to which they pertain.
These final regulations reflect one change from the NPRM, resulting from public comments. Section 222.192 is amended to specify that when assessing a grant recipient's available resources for capital improvements, the Secretary will not consider funds associated with legally binding written commitments in a district's capital fund that have been obligated but not yet liquidated.
Analysis of Comments and Changes
In response to the Secretary's invitation in the NPRM, two parties submitted comments on the proposed regulations. An analysis of the comments and of the change in the regulations since publication of the NPRM follows. Generally, we do not address technical and other minor changes--and suggested changes the law does not authorize the Secretary to make.
Available Local Funds (Section 222.192)
Comment: One commenter recommended that we amend the regulations to allow the Secretary, when assessing a potential grantee's available capital resources, to review revised annual audit reports or other written proof of binding obligations that the grantee has made but not yet paid for.
Discussion: Prior to making final funding decisions and determining final grant awards, the Secretary may verify certain data with applicants' States and will also assess available resources for all highly ranked grantees, limitations on the grant awards for certain grantee categories, and the availability of in-kind contributions. The Secretary considers as available to fund the project the closing capital fund balance identified in the LEA's audited financial report for the prior year, not including $100,000 or ten percent of the average annual capital expenditures of the applicant for the three previous fiscal years, whichever is greater. We agree that the regulations and the program implementation would be improved with the change recommended by the commenter. We also believe that the benefits of this provision to the few cases to which it would apply justify the minimal costs to the applicants required to submit the documents that would be associated with this addition.
Change: The Secretary will also exclude from consideration capital funds that a grantee can show have been committed by a written binding agreement but have not yet been paid from the grantee's capital fund. We have amended Sec. 222.192 to reflect this revision.
Permissible Uses of Funds (Section 222.172)
Comment: One commenter expressed a concern that Sec. 222.172 would prohibit any grants to LEAs that do not hold title to a school facility. In the commenter's State, LEAs often have exclusive use through ground leases of a school facility located on Indian lands.
Discussion: The regulations provide that an LEA may receive emergency or modernization grants for repairs or renovations to a facility in which it has an interest, including a leasehold interest. Accordingly, LEAs leasing space on Indian lands for their schools would be eligible to receive these types of grants, but as noted in Sec. 222.172(c), we would not allow a grant to completely replace a school (new construction) for which the applicant does not hold title. We do not believe a change to the regulations is necessary.
Change: None.
Executive Order 12866
We have reviewed these final regulations in accordance with Executive Order 12866. Under the terms of the order we have assessed the potential costs and benefits of this regulatory action.
The potential costs associated with the final regulations are those resulting from statutory requirements and those we have determined to be necessary for administering this program effectively and efficiently.
In assessing the potential costs and benefits--both quantitative and qualitative--of these final regulations, we have determined that the benefits of the regulations justify the costs.
We have also determined that this regulatory action does not unduly interfere with State, local, and tribal governments in the exercise of their governmental functions.
Summary of Potential Costs and Benefits
We discussed the potential costs and benefits of these final regulations in the preamble to the NPRM under the heading Paperwork Reduction Act of
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1995. We include additional discussion of potential costs and benefits in the section of this preamble titled Analysis of Comments and Changes.
Regulatory Flexibility Act Certification
The Secretary certifies that these regulations will not have a significant economic impact on a substantial number of small entities. The small entities that are affected by these regulations are small LEAs receiving Federal funds under this program. However, in the FY 2002 grant competition, fewer than 40 applications that were eligible to be evaluated by field readers were submitted by small entities. In addition, we do not believe that the regulations have a significant economic impact on the limited number of small LEAs affected because the regulations do not impose excessive regulatory burdens or require unnecessary Federal supervision.
The regulations benefit both small and large entities in that they clarify confusing and complex statutory requirements. Also, since the statute requires Impact Aid school districts to apply if they wish to receive these discretionary funds, the Department is not able to award these funds without the specified application information. The application process will ensure that districts do not provide significant amounts of information that is already available to the Department from annual Impact Aid formula grant applications.
In addition, electronic applications will be available for the competition to award FY 2004 funds, which will further minimize burden to all applicants. The software will populate certain application data fields for applicants that submitted an Impact Aid section 8003 application for FY 2004, and will have built-in checks for completion of all necessary items. This software will reduce the burden on applicants of organizing and entering data that were already submitted to the Impact Aid Program, will help applicants determine whether their LEAs meet the program's eligibility requirements, and will reduce the number of errors in applications. Also, whenever possible, certain fiscal data are collected from State agencies, which are not defined as ``small entities'' in the Regulatory Flexibility Act.
The Secretary specifically invited comment in the NPRM on the effects of the proposed regulations on small entities but we received no comments on that topic. The regulations impose minimal paperwork burden requirements for all applicants and minimal requirements with which the grant recipients must comply.
Paperwork Reduction Act of 1995
Sections 222.183, 222.184, 222.185, and 222.186 contain information collection requirements. The Paperwork Reduction Act of 1995 does not require you to respond to a collection of information unless it displays a valid OMB control number. We display the valid OMB control numbers assigned to the collections of information in these final regulations at the end of the affected sections of the regulations.
Intergovernmental Review
This program is subject to the requirements of Executive Order 12372 and the regulations in 34 CFR part 79. The objective of the Executive Order is to foster an intergovernmental partnership and a strengthened federalism by relying on processes developed by State and local governments for coordination and review of proposed Federal financial assistance.
In accordance with the order, we intend this document to provide early notification of the Department's specific plans and actions for this program.
Electronic Access to This Document
You may view this document, as well as all other Department of Education documents published in the Federal Register, in text or Adobe Portable Document Format (PDF) on the Internet at the following site: http://www.ed.gov/news/fedregister.
To use PDF you must have Adobe Acrobat Reader, which is available free at this site. If you have questions about using PDF, call the U.S. Government Printing Office (GPO), toll free, at 1-888-293-6498; or in the Washington, DC, area at (202) 512-1530.
You may also view this document in PDF at the following site: http://www.ed.gov/programs/8007b/.
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: http://www.gpoaccess.gov/nara/index.html .
(Catalog of Federal Domestic Assistance Number 84.041C Impact Aid Discretionary Construction Program.)
List of Subjects in 34 CFR Part 222
Education, Education of children with disabilities, Educational facilities, Elementary and secondary education, Federally affected areas, Grant programs-education, Indians-education, Public housing, Reporting and recordkeeping requirements, School construction, Schools.
Dated: March 9, 2004. Raymond Simon, Assistant Secretary for Elementary and Secondary Education.
0 For the reasons discussed in the preamble, the Secretary amends title 34 of the Code of Federal Regulations by revising subpart L of part 222 to read as follows:
PART 222--IMPACT AID PROGRAMS
0 1. The authority citation for part 222 continues to read as follows:
Authority: 20 U.S.C. 7701-7714, unless otherwise noted.
0 2. Revise subpart L of part 222 to read as follows: Subpart L--Impact Aid Discretionary Construction Grant Program Under Section 8007(b) of the Act
General
Sec. 222.170 What is the purpose of the Impact Aid Discretionary Construction grant program (Section 8007(b) of the Act)? 222.171 What LEAs may be eligible for Discretionary Construction grants? 222.172 What activities may an LEA conduct with funds received under this program? 222.173 What activities will not receive funding under a Discretionary Construction grant? 222.174 What prohibitions apply to these funds? 222.175 What regulations apply to recipients of funds under this program? 222.176 What definitions apply to this program?
Eligibility
222.177 What eligibility requirements must an LEA meet to apply for an emergency grant under the first priority? 222.178 What eligibility requirements must an LEA meet to apply for an emergency grant under the second priority? 222.179 Under what circumstances may an ineligible LEA apply on behalf of a school for an emergency grant under the second priority? 222.180 What eligibility requirements must an LEA meet to apply for a modernization grant under the third priority? 222.181 What eligibility requirements must an LEA meet to apply for a modernization grant under the fourth priority? 222.182 Under what circumstances may an ineligible LEA apply on behalf of a school for a modernization grant under the fourth priority?
How To Apply for a Grant
222.183 How does an LEA apply for a grant? 222.184 What information must an application contain? 222.185 What additional information must be included in an emergency grant application?
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222.186 What additional information must be included in a modernization grant application? 222.187 Which year's data must an SEA or LEA provide?
How Grants Are Made
222.188 What priorities may the Secretary establish? 222.189 What funding priority does the Secretary give to applications? 222.190 How does the Secretary rank and select applicants? 222.191 What is the maximum award amount? 222.192 What local funds may be considered as available for this project? 222.193 What other limitations on grant amounts apply? 222.194 Are ``in-kind'' contributions permissible?
Conditions and Requirements Grantees Must Meet
222.195 How does the Secretary make funds available to grantees? 222.196 What additional construction and legal requirements apply?
Subpart L--Impact Aid Discretionary Construction Grant Program Under Section 8007(b) of the Act
General
Sec. 222.170 What is the purpose of the Impact Aid Discretionary Construction grant program (Section 8007(b) of the Act)?
The Impact Aid Discretionary Construction grant program provides competitive grants for emergency repairs and modernization of school facilities to certain eligible local educational agencies (LEAs) that receive formula Impact Aid funds.
(Authority: 20 U.S.C. 7707(b))
Sec. 222.171 What LEAs may be eligible for Discretionary Construction grants?
(a) Applications for these grants are considered in four funding priority categories. The specific requirements for each priority are detailed in Sec. Sec. 222.177 through 222.182.
(b)(1) Generally, to be eligible for an emergency construction grant, an LEA must--
(i) Enroll a high proportion (at least 40 percent) of federally connected children in average daily attendance (ADA) who reside on Indian lands or who have a parent on active duty in the U.S. uniformed services;
(ii) Have a school that enrolls a high proportion of one of these types of students;
(iii) Be eligible for funding for heavily impacted LEAs under section 8003(b)(2) of the Act; or
(iv) Meet the specific numeric requirements regarding bonding capacity.
(2) The Secretary must also consider such factors as an LEA's total assessed value of real property that may be taxed for school purposes, its availability and use of bonding capacity, and the nature and severity of the emergency.
(c)(1) Generally, to be eligible for a modernization construction grant, an LEA must--
(i) Be eligible for Impact Aid funding under either section 8002 or 8003 of the Act;
(ii) Be eligible for funding for heavily impacted LEAs under section 8003(b)(2) of the Act;
(iii) Enroll a high proportion (at least 40 percent) of federally connected children in ADA who reside on Indian lands or who have a parent on active duty in the U.S. uniformed services;
(iv) Have a school that enrolls a high proportion of one of these types of students; or
(v) Meet the specific numeric requirements regarding bonding capacity.
(2) The Secretary must also consider such factors as an LEA's total assessed value of real property that may be taxed for school purposes, its availability and use of bonding capacity, and the nature and severity of its need for modernization funds.
(Authority: 20 U.S.C. 7707(b))
Sec. 222.172 What activities may an LEA conduct with funds received under this program?
(a) An LEA may use emergency grant funds received under this program only to repair, renovate, alter, and, in the limited circumstances described in paragraph (c) of this section, replace a public elementary or secondary school facility used for free public education to ensure the health and safety of students and personnel, including providing accessibility for the disabled as part of a larger project.
(b) An LEA may use modernization grant funds received under this program only to renovate, alter, retrofit, extend, and, in the limited circumstances described in paragraph (c) of this section, replace a public elementary or secondary school facility used for free public education to provide school facilities that support a contemporary educational program for the LEA's students at normal capacity, and in accordance with the laws, standards, or common practices in the LEA's State.
(c)(1) An emergency or modernization grant under this program may be used for the construction of a new school facility but only if the Secretary determines--
(i) That the LEA holds title to the existing facility for which funding is requested; and
(ii) In consultation with the grantee, that partial or complete replacement of the facility would be less expensive or more cost- effective than improving the existing facility.
(2) When construction of a new school facility is permitted, emergency and modernization funds may be used only for a new school facility that is used for free public education. These funds may be used for the--
(i) Construction of instructional, resource, food service, and general or administrative support areas, so long as they are a part of the instructional facility; and
(ii) Purchase of initial equipment or machinery, and initial utility connections.
(Authority: 20 U.S.C. 7707(b))
Sec. 222.173 What activities will not receive funding under a Discretionary Construction grant?
The Secretary does not fund the following activities under a Discretionary Construction grant:
(a) Improvements to facilities for which the LEA does not have full title or other interest, such as a lease-hold interest.
(b) Improvements to or repairs of school grounds, such as environmental remediation, traffic remediation, and landscaping, that do not directly involve instructional facilities.
(c) Repair, renovation, alteration, or construction for stadiums or other facilities that are primarily used for athletic contests, exhibitions, and other events for which admission is charged to the general public.
(d) Improvements to or repairs of teacher housing.
(e) Except in the limited circumstances as provided in Sec. 222.172(c), when new construction is permissible, acquisition of any interest in real property.
(f) Maintenance costs associated with any of an LEA's school facilities.
(Authority: 20 U.S.C. 7707(b))
Sec. 222.174 What prohibitions apply to these funds?
Grant funds under this program may not be used to supplant or replace other available non-Federal construction money. These grant funds may be used for emergency or modernization activities only to the extent that they supplement the amount of construction funds that would, in the absence of these grant funds, be available to a grantee from non-Federal funds for these purposes.
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Example 1. ``Supplanting.'' An LEA signs a contract for a $300,000 roof replacement and plans to use its capital expenditure fund to pay for the renovation. Since the LEA already has non- Federal funds available for the roof project, it may not now use a grant from this program to pay for the project or replace its own funds in order to conserve its capital fund.
Example 2. ``Non-supplanting.'' The LEA from the example of supplanting that has the $300,000 roof commitment has also received a $400,000 estimate for the replacement of its facility's heating, ventilation, and air conditioning (HVAC) system. The LEA has not made any commitments for the HVAC system because it has no remaining funds available to pay for that work. Since other funds are not available, it would not be supplanting if the LEA received an emergency grant under this program to pay for the HVAC system.
(Authority: 20 U.S.C. 7707(b))
Sec. 222.175 What regulations apply to recipients of funds under this program?
The following regulations apply to the Impact Aid Discretionary Construction program:
(a) The Education Department General Administrative Regulations (EDGAR) as follows:
(1) 34 CFR part 75 (Direct Grant Programs) except for 34 CFR Sec. Sec. 75.600 through 75.617.
(2) 34 CFR part 77 (Definitions that Apply to Department Regulations).
(3) 34 CFR part 79 (Intergovernmental Review of Department of Education Programs and Activities).
(4) 34 CFR part 80 (Uniform Administrative Requirements for Grants and Cooperative Agreements to State and Local Governments).
(5) 34 CFR part 81 (General Education Provisions Act--Enforcement).
(6) 34 CFR part 82 (New Restrictions on Lobbying).
(7) 34 CFR part 84 (Governmentwide Requirements for Drug-Free Workplace (Financial Assistance)).
(8) 34 CFR part 85 (Governmentwide Debarment and Suspension (Nonprocurement)).
(b) The regulations in 34 CFR part 222.
(Authority: 20 U.S.C. 1221e-3)
Sec. 222.176 What definitions apply to this program?
(a) In addition to the terms referenced in 34 CFR 222.2, the following definitions apply to this program:
Bond limit means the cap or limit that a State may impose on an LEA's capacity for bonded indebtedness. For applicants in States that place no limit on an LEA's capacity for bonded indebtedness, the Secretary shall consider the LEA's bond limit to be 10 percent of its total assessed valuation.
Construction means
(1) Preparing drawings and specifications for school facilities;
(2) Repairing, renovating, or altering school facilities;
(3) Extending school facilities as described in Sec. 222.172(b);
(4) Erecting or building school facilities, as described in Sec. 222.172(c); and
(5) Inspections or supervision related to school facilities projects.
Emergency means a school facility condition that is so injurious or hazardous that it either poses an immediate threat to the health and safety of the facility's students and staff or can be reasonably expected to pose such a threat in the near future. These conditions can include deficiencies in the following building features: a roof; electrical wiring; a plumbing or sewage system; heating, ventilation, or air conditioning; the need to bring a school facility into compliance with fire and safety codes, or providing accessibility for the disabled as part of a larger project.
Level of bonded indebtedness means the amount of long-term debt issued by an LEA divided by the LEA's bonding capacity.
Minimal capacity to issue bonds means that the total assessed value of real property in an LEA that may be taxed for school purposes is at least $25,000,000 but not more than $50,000,000.
Modernization means the repair, renovation, alteration, or extension of a public elementary or secondary school facility in order to support a contemporary educational program for an LEA's students in normal capacity, and in accordance with the laws, standards, or common practices in the LEA's State.
No practical capacity to issue bonds means that the total assessed value of real property in an LEA that may be taxed for school purposes is less than $25,000,000.
School facility means a building used to provide free public education, including instructional, resource, food service, and general or administrative support areas, so long as they are a part of the facility.
Total assessed value per student means the assessed valuation of real property per pupil (AVPP), unless otherwise defined by an LEA's State.
(b) The following terms used in this subpart are defined or referenced in 34 CFR 77.1:
Applicant Application Award Contract Department EDGAR Equipment Fiscal year Grant Grantee Project Public Real property Recipient
(Authority: 20 U.S.C. 7707(b) and 1221e-3)
Eligibility
Sec. 222.177 What eligibility requirements must an LEA meet to apply for an emergency grant under the first priority?
An LEA is eligible to apply for an emergency grant under the first priority of section 8007(b) of the Act if it--
(a) Is eligible to receive formula construction funds for the fiscal year under section 8007(a) of the Act;
(b)(1) Has no practical capacity to issue bonds;
(2) Has minimal capacity to issue bonds and has used at least 75 percent of its bond limit; or
(3) Is eligible to receive funds for the fiscal year for heavily impacted districts under section 8003(b)(2) of the Act; and
(c) Has a school facility emergency that the Secretary has determined poses a health or safety hazard to students and school personnel.
(Authority: 20 U.S.C. 7707(b))
Sec. 222.178 What eligibility requirements must an LEA meet to apply for an emergency grant under the second priority?
Except as provided in Sec. 222.179, an LEA is eligible to apply for an emergency grant under the second priority of section 8007(b) of the Act if it--
(a) Is eligible to receive funds for the fiscal year under section 8003(b) of the Act;
(b)(1) Enrolls federally connected children living on Indian lands equal to at least 40 percent of the total number of children in average daily attendance (ADA) in its schools; or
(2) Enrolls federally connected children with a parent in the U.S. uniformed services equal to at least 40 percent of the total number of children in ADA in its schools;
(c) Has used at least 75 percent of its bond limit;
(d) Has an average per-student assessed value of real property available to be taxed for school purposes that is below its State average; and
(e) Has a school facility emergency that the Secretary has determined poses a health or safety hazard to students and school personnel.
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(Authority: 20 U.S.C. 7707(b))
Sec. 222.179 Under what circumstances may an ineligible LEA apply on behalf of a school for an emergency grant under the second priority?
An LEA that is eligible to receive section 8003(b) assistance for the fiscal year but that does not meet the other eligibility criteria described in Sec. 222.178(a) or (b) may apply on behalf of a school located within its geographic boundaries for an emergency grant under the second priority of section 8007(b) of the Act if--
(a) The school--
(1) Enrolls children living on Indian lands equal to at least 40 percent of the total number of children in ADA; or
(2) Enrolls children with a parent in the U.S. uniformed services equal to at least 40 percent of the total number of children in ADA;
(b) The school has a school facility emergency that the Secretary has determined poses a health or safety hazard to students and school personnel;
(c) The LEA has used at least 75 percent of its bond limit; and
(d) The LEA has an average per-student assessed value of real property available to be taxed for school purposes that is below its State average.
(Authority: 20 U.S.C. 7707(b))
Sec. 222.180 What eligibility requirements must an LEA meet to apply for a modernization grant under the third priority?
An LEA is eligible to apply for a modernization grant under the third priority of section 8007(b) of the Act if it--
(a) Is eligible to receive funds for the fiscal year under section 8002 or 8003(b) of the Act;
(b)(1) Has no practical capacity to issue bonds;
(2) Has minimal capacity to issue bonds and has used at least 75 percent of its bond limit; or
(3) Is eligible to receive funds for the fiscal year for heavily impacted districts under section 8003(b)(2) of the Act; and
(c) Has facility needs resulting from the presence of the Federal Government, such as the enrollment of federally connected children, the presence of Federal property, or an increase in enrollment due to expanded Federal activities, housing privatization, or the acquisition of Federal property.
(Authority: 20 U.S.C. 7707(b))
Sec. 222.181 What eligibility requirements must an LEA meet to apply for a modernization grant under the fourth priority?
An LEA is eligible to apply for a modernization grant under the fourth priority of section 8007(b) of the Act if it--
(a)(1) Is eligible to receive funds for the fiscal year under section 8003(b) of the Act; and
(i) Enrolls children living on Indian lands equal to at least 40 percent of the total number of children in ADA in its schools; or
(ii) Enrolls children with a parent in the U.S. uniformed services equal to at least 40 percent of the total number of children in ADA in its schools; or
(2) Is eligible to receive assistance for the fiscal year under section 8002 of the Act;
(b) Has used at least 75 percent of its bond limit;
(c) Has an average per-student assessed value of real property available to be taxed for school purposes that is below its State average; and
(d) Has facility needs resulting from the presence of the Federal Government, such as the enrollment of federally connected children, the presence of Federal property, or an increase in enrollment due to expanded Federal activities, housing privatization, or the acquisition of Federal property.
(Authority: 20 U.S.C. 7707(b))
Sec. 222.182 Under what circumstances may an ineligible LEA apply on behalf of a school for a modernization grant under the fourth priority?
An LEA that is eligible to receive a payment under Title VIII for the fiscal year but that does not meet the other eligibility criteria described in Sec. 222.181 may apply on behalf of a school located within its geographic boundaries for a modernization grant under the fourth priority of section 8007(b) of the Act if--
(a) The school--
(1) Enrolls children living on Indian lands equal to at least 40 percent of the total number of children in ADA; or
(2) Enrolls children with a parent in the U.S. uniformed services equal to at least 40 percent of the total number of children in ADA;
(b) The LEA has used at least 75 percent of its bond limit;
(c) The LEA has an average per-student assessed value of real property available to be taxed for school purposes that is below its State average; and
(d) The school has facility needs resulting from the presence of the Federal Government, such as the enrollment of federally connected children, the presence of Federal property, or an increase in enrollment due to expanded Federal activities, housing privatization, or the acquisition of Federal property.
(Authority: 20 U.S.C. 7707(b))
How To Apply for a Grant
Sec. 222.183 How does an LEA apply for a grant?
(a) To apply for funds under this program, an LEA may submit more than one application in a fiscal year. An LEA must submit a separate application for each school for which it proposes a project, and may submit more than one application for a single school if multiple projects are proposed.
Examples: 1. An LEA wants to receive both an emergency and a modernization grant for one school that has a failing roof and that also needs significant classroom modernization. The LEA would submit an emergency repair grant application to address the roof issues and a separate modernization application to request funds to renovate classroom space.
2. An LEA has five schools and seeks emergency grants to replace a roof and a boiler in one school and to replace windows in a second school. It should submit two applications--one for each of the two school facilities.
3. An LEA has one school that has several conditions that need to be corrected--a failing roof, aging windows that impair the efficiency of the heating system, and asbestos in floor tiles. The LEA may submit a single application for all of these conditions or separate emergency repair grant applications for each condition, if the LEA judges that they present varying degrees of urgency.
(b) An application must--
(1) Contain the information required in Sec. Sec. 222.184 through 222.186, as applicable, and in any application notice that the Secretary may publish in the Federal Register; and
(2) Be timely filed in accordance with the provisions of the Secretary's application notice.
(Approved by the Office of Management and Budget under control number 1810-0657)
(Authority: 20 U.S.C. 7707(b))
Sec. 222.184 What information must an application contain?
An application for an emergency or modernization grant must contain the following information:
(a) The name of the school facility the LEA is proposing to repair, construct, or modernize.
(b)(1) For an applicant under section 8003(b) of the Act, the number of federally connected children described in section 8003(a)(1) enrolled in the school facility, as well as the total enrollment in the facility, for which the LEA is seeking a grant; or
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(2) For an applicant under section 8002 of the Act, the total enrollment, for the preceding year, in the LEA and in the school facility for which the LEA is seeking a grant, based on the fall State count date.
(c) The identification of the LEA's interest in, or authority over, the school facility involved, such as an ownership interest or a lease arrangement.
(d) The original construction date of the school facility that the LEA proposes to renovate or modernize.
(e) The dates of any major renovations of that school facility and the areas of the school covered by the renovations.
(f) The proportion of Federal acreage within the geographic boundaries of the LEA.
(g) Fiscal data including the LEA's--
(1) Maximum bonding capacity;
(2) Amount of bonded debt;
(3) Total assessed value of real property available to be taxed for school purposes;
(4) State average assessed value per pupil of real property available to be taxed for school purposes;
(5) Local real property tax levy, in mills or dollars, used to generate funds for capital expenditures; and
(6) Sources and amounts of funds available for the proposed project.
(h) A description of the need for funds and the proposed project for which a grant under this subpart L would be used, including a cost estimate for the project.
(i) Applicable assurances and certifications identified in the approved grant application package.
(Approved by the Office of Management and Budget under control number 1810-0657)
(Authority: 20 U.S.C. 7707(b))
Sec. 222.185 What additional information must be included in an emergency grant application?
In addition to the information specified in Sec. 222.184, an application for an emergency grant must contain the following:
(a) A description of the deficiency that poses a health or safety hazard to occupants of the facility.
(b) A description of how the deficiency adversely affects the occupants and how it will be repaired.
(c) A statement signed by an appropriate local official, as defined below, that the deficiency threatens the health and safety of occupants of the facility or prevents the use of the facility. An appropriate local official may include a local building inspector, a licensed architect, or a licensed structural engineer. An appropriate local official may not include a member of the applicant LEA's staff.
(Approved by the Office of Management and Budget under control number 1810-0657)
(Authority: 20 U.S.C. 7707(b))
Sec. 222.186 What additional information must be included in a modernization grant application?
In addition to the information specified in Sec. 222.184, an application for a modernization grant must contain a description of--
(a) The need for modernization; and
(b) How the applicant will use funds received under this program to address the need referenced in paragraph (a) of this section.
(Approved by the Office of Management and Budget under control number 1810-0657)
(Authority: 20 U.S.C. 7707(b))
Sec. 222.187 Which year's data must an SEA or LEA provide?
(a) Except as provided in paragraph (b) of this section, the Secretary will determine eligibility under this discretionary program based on student and fiscal data for each LEA from the fiscal year preceding the fiscal year for which the applicant is applying for funds.
(b) If satisfactory fiscal data are not available from the preceding fiscal year, the Secretary will use data from the most recent fiscal year for which data that are satisfactory to the Secretary are available.
(Authority: 20 U.S.C. 7707(b))
How Grants Are Made
Sec. 222.188 What priorities may the Secretary establish?
In any given year, the Secretary may assign extra weight for certain facilities systems or emergency and modernization conditions by identifying the systems or conditions and their assigned weights in a notice published in the Federal Register.
(Authority: 20 U.S.C. 7707(b))
Sec. 222.189 What funding priority does the Secretary give to applications?
(a) Except as provided in paragraph (b) of this section, the Secretary gives funding priority to applications in the following order:
(1) First priority is given to applications described under Sec. 222.177 and, among those applicants for emergency grants, priority is given to applications based on a rank order of the application quality factors referenced in Sec. 222.190, including the severity of the emergency.
(2) After all eligible first-priority applications are funded, second priority is given to applications described under Sec. Sec. 222.178 and 222.179 and, among those applicants for emergency grants, priority is given to applications based on a rank order of the application quality factors referenced in Sec. 222.190, including the severity of the emergency.
(3) Third priority is given to applications described under Sec. 222.180 and, among those applicants for modernization grants, priority is given to applications based on a rank order of the application quality factors referenced in Sec. 222.190, including the severity of the need for modernization.
(4) Fourth priority is given to applications described under Sec. Sec. 222.181 and 222.182 and, among those applicants for modernization grants, priority is given to applications based on a rank order of the application quality factors referenced in Sec. 222.190, including the severity of the need for modernization.
(b)(1) The Secretary makes awards in each priority described above until the Secretary is unable to make an approvable award in that priority.
(2) If the Secretary is unable to fund a full project or a viable portion of a project, the Secretary may continue to fund down the list of high-ranking applicants within a priority.
(3) The Secretary applies any remaining funds to awards in the next priority.
(4) If an applicant does not receive an emergency or modernization grant in a fiscal year, the Secretary will, subject to the availability of funds and to the priority and award criteria, consider that application in the following year along with the next fiscal year's pool of applications.
Example: The first five applicants in priority one have been funded. Three hundred thousand dollars remain available. Three unfunded applications remain in that priority. Application 6 requires a minimum of $500,000, application 7 requires $400,000, and application 8 requires $300,000 for a new roof and $150,000 for related wall and ceiling repairs. Applicant 8 agrees to accept the remaining $300,000 since the roof upgrade can be separated into a viable portion of applicant 8's total project. Applications 6 and 7 will be retained for consideration in the next fiscal year and will compete again with that fiscal year's pool of applicants. Applicant 8 will have to submit a new application in the next fiscal year if it wishes to be considered for the unfunded portion of the current year's application.
(Authority: 20 U.S.C. 7707(b))
Sec. 222.190 How does the Secretary rank and select applicants?
(a) To the extent that they are consistent with these regulations and section 8007(b) of the Act, the Secretary will follow grant selection procedures that are specified in 34 CFR 75.215
[[Page 12240]]
through 75.222. In general these procedures are based on the authorizing statute, the selection criteria, and any priorities or other applicable requirements that have been published in the Federal Register.
(b) In the event of ties in numeric ranking, the Secretary may consider as tie-breaking factors: the severity of the emergency or the need for modernization; for applicants under section 8003 of the Act, the numbers of federally connected children who will benefit from the project; or for applicants under section 8002 of the Act, the numbers of children who will benefit from the project; the AVPP compared to the LEA's State average; and available resources or non-Federal funds available for the grant project.
(Authority: 20 U.S.C. 7707(b))
Sec. 222.191 What is the maximum award amount?
(a) Subject to any applicable contribution requirements as described in Sec. Sec. 222.192 and 222.193, the procedures in 34 CFR 75.231 through 75.236, and the provisions in paragraph (b) of this section, the Secretary may fund up to 100 percent of the allowable costs in an approved grantee's proposed project.
(b) An award amount may not exceed the difference between--
(1) The cost of the proposed project; and
(2) The amount the grantee has available or will have available for this purpose from other sources, including local, State, and other Federal funds.
(Authority: 20 U.S.C. 7707(b))
Sec. 222.192 What local funds may be considered as available for this project?
To determine the amount of local funds that an LEA has available under Sec. 222.191(b)(2) for a project under this program, the Secretary will consider as available all LEA funds that may be used for capital expenditures except $100,000 or 10 percent of the average annual capital expenditures of the applicant for the three previous fiscal years, whichever is greater. The Secretary will not consider capital funds that an LEA can demonstrate have been committed through signed contracts or other written binding agreements but have not yet been expended.
(Authority: 20 U.S.C. 7707(b))
Sec. 222.193 What other limitations on grant amounts apply?
(a) Except as provided in paragraph (b) of this section and Sec. 222.191, the amount of funds provided under an emergency grant or a modernization grant awarded to an eligible LEA is subject to the following limitations:
(1) The award amount may not be more than 50 percent of the total cost of an approved project.
(2) The total amount of grant funds may not exceed four million dollars during any four-year period.
Example: An LEA that is awarded four million dollars in the first year may not receive any additional funds for the following three years.
(b) Emergency or modernization grants to LEAs with no practical capacity to issue bonds as defined in Sec. 222.176 are not subject to the award limitations described in paragraph (a) of this section.
(Authority: 20 U.S.C. 7707(b))
Sec. 222.194 Are ``in-kind'' contributions permissible?
(a) LEAs that are subject to the applicable matching requirement described in Sec. 222.193(a) may use allowable third party in-kind contributions as defined below to meet the requirements.
(b) Third party in-kind contributions mean property or services that benefit this grant program and are contributed by non-Federal third parties without charge to the grantee or by a cost-type contractor under the grant agreement.
(c) Subject to the limitations of 34 CFR 75.564(c)(2) regarding indirect costs, the provisions of 34 CFR 80.24 govern the allowability and valuation of in-kind contributions, except that it is permissible for a third party to contribute real property to a grantee for a project under this program, so long as no Federal funds are spent for the acquisition of real property.
(Authority: 20 U.S.C. 7707(b))
Conditions and Requirements Grantees Must Meet
Sec. 222.195 How does the Secretary make funds available to grantees?
The Secretary makes funds available to a grantee during a project period using the following procedure:
(a) Upon final approval of the grant proposal, the Secretary authorizes a project period of up to 60 months based upon the nature of the grant proposal and the time needed to complete the project.
(b) The Secretary then initially makes available to the grantee 10 percent of the total award amount.
(c) After the grantee submits a copy of the emergency or modernization contract approved by the grantee's governing board, the Secretary makes available 80 percent of the total award amount to a grantee.
(d) The Secretary makes available up to the remaining 10 percent of the total award amount to the grantee after the grantee submits a statement that--
(1) Details any earnings, savings, or interest;
(2) Certifies that--
(i) The project is fully completed; and
(ii) All the awarded funds have been spent for grant purposes; and
(3) Is signed by the--
(i) Chairperson of the governing board;
(ii) Superintendent of schools; and
(iii) Architect of the project.
(Authority: 20 U.S.C. 7707(b))
Sec. 222.196 What additional construction and legal requirements apply?
(a) Except as provided in paragraph (b) of this section, a grantee under this program must comply with--
(1) The general construction legal requirements identified in the grant application assurances;
(2) The prevailing wage standards in the grantee's locality that are established by the Secretary of Labor in accordance with the Davis- Bacon Act (40 U.S.C. 276a, et seq.); and
(3) All relevant Federal, State, and local environmental laws and regulations.
(b) A grantee that qualifies for a grant because it enrolls a high proportion of federally connected children who reside on Indian lands is considered to receive a grant award primarily for the benefit of Indians and must therefore comply with the Indian preference requirements of section 7(b) of the Indian Self-Determination Act.
(Authority: 20 U.S.C. 7707(b) and 1221e-3)
[FR Doc. 04-5670 Filed 3-12-04; 8:45 am]
BILLING CODE 4000-01-P
