[Federal Register: April 4, 1996 (Volume 61, Number 66)]
[Notices]
[Page 15058]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
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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