[Federal Register: April 4, 1996 (Volume 61, Number 66)] [Notices] [Page 15058] From the Federal Register Online via GPO Access [wais.access.gpo.gov] ======================================================================= ----------------------------------------------------------------------- DEPARTMENT OF EDUCATION Office of Administrative Law Judges; Notice of Intent To Compromise a Claim; Alaska Department of Education SUMMARY: The Department intends to compromise a claim against the Alaska Department of Education (Alaska) now pending before the Office of Administrative Law Judges (OALJ). Docket No. 94-204-R. (20 U.S.C. 1234a(j)). DATES: Interested persons may comment on the proposed action by submitting written data, views, or arguments on or before May 20, 1996. ADDRESSES: Comments should be addressed to Lynette Charboneau, Office of the General Counsel, U.S. Department of Education, 600 Independence Avenue, S.W. (Room 5312, FB 10B), Washington, D.C. 20202. FOR FURTHER INFORMATION CONTACT: Lynette Charboneau, Esq., Telephone: (202) 401-8292. Individuals who use a telecommunications device for the deaf (TDD) may call the Federal Information Relay Service (FIRS) at 1- 800-877-8339 between 8 a.m. and 8 p.m., Eastern time, Monday through Friday. SUPPLEMENTARY INFORMATION: The claim in question arose from an audit of the financial assistance programs of Alaska for the fiscal year ending June 30, 1991. The audit was performed by the Alaska Division of Legislative Audit, to fulfill the requirements of Office of Management and Budget Circular A-128. The audit included an evaluation of the internal control systems used in administering Federal financial assistance programs. Among the systems examined were Alaska's procedures for administering funds awarded under Title II of the Carl D. Perkins Vocational Education Act (Perkins Act), 20 U.S.C. 2331 (1988). The Perkins Act imposed specific requirements as to a State's allocation of Title II funds among State administration, Part A, and Part B. See 20 U.S.C. 2312 (1988). A State could reserve up to 7 percent of the total grant for Title II for State administration, including $60,000 for sex equity administration, plus an additional amount by which the $60,000 exceeded 1 percent of the State's total grant under Title II. After funds were reserved for administration, the State was required to allocate the remainder 57 percent to Part A and 43 percent to Part B. The 57 percent for Part A was to be further reserved to benefit specific targeted groups of students. See 20 U.S.C. 2332 (1988). Thus, if a State expended more than the allowable 7 percent on State administration, it would necessarily have to spend less than the mandated amount for Part A or Part B, or both. The auditors found that Alaska's expenditures for State administration in Fiscal Years (FYs) 1990 and 1991 exceeded the 7 percent cap. Further, the auditors found that in FY 1990 the State's expenditures under Part B exceeded the allowable 43 percent. On October 19, 1994, the Department's Assistant Secretary for Vocational and Adult Education (Assistant Secretary) issued a program determination letter (PDL) sustaining the auditors' findings and requiring Alaska to repay $414,657.72 for the amounts of the overfunding of State administration and Part B (and corresponding underfunding of Part A) in FYs 1990 and 1991. Alaska filed a timely appeal with the Office of Administrative Law Judges (OALJ). After filing its brief and evidence, Alaska offered to settle the claim against it. The administrative law judge (ALJ) appointed to hear this appeal stayed the proceeding to allow counsel to seek formal approval of the tentative settlement. Based on documentation submitted by Alaska during the course of the proceedings before the OALJ demonstrating that $168,116.27 of the funds were allowable, the Assistant Secretary has decided to reduce the claim to $246,541.45. The Department proposes to compromise the remaining claim for $91,500. After receiving the PDL, Alaska submitted information directly to the Assistant Secretary to show that its FSRs reflected reporting errors as to the amount of Title II funds expended for State administration. Additionally, during the course of its appeal to the OALJ, Alaska submitted voluminous evidence in an attempt to show that the State could have charged to Part A many of the overcharges to Part B because of the overlapping purposes and goals of those program authorities. After consideration of the documentation and arguments presented by Alaska to the OALJ, the Assistant Secretary has decided to reduce the repayment demanded by $168,116.27, and the Department proposes to settle the remaining claim of $246,541.45 for $91,500. Given the amount that would be repaid by Alaska under the settlement agreement, the additional documentation, and the litigation risks and costs of proceeding through the appeal process, the Department has determined that it would not be practical or in the public interest to continue this proceeding. Rather, under the authority provided in 20 U.S.C. Sec. 1234a(j)(1), the Department has determined that a compromise of this claim for $91,500 would be appropriate. The public is invited to comment on the Department's intent to compromise this claim. Additional information may be obtained by writing to Lynette Charboneau at the address given at the beginning of this notice. Program Authority: 20 U.S.C. 1234a(j). Dated: April 1, 1996. Donald R. Wurtz, Chief Financial Officer. [FR Doc. 96-8300 Filed 4-3-96; 8:45 am] BILLING CODE 4000-01-P