[Federal Register: March 25, 1996 (Volume 61, Number 58)] [Notices] [Page 12061] From the Federal Register Online via GPO Access [wais.access.gpo.gov] ======================================================================= ----------------------------------------------------------------------- DEPARTMENT OF EDUCATION Intent To Compromise Two Audit Claims Against Connecticut State Board of Education AGENCY: Department of Education. ACTION: Notice of intent to compromise two audit claims. ----------------------------------------------------------------------- SUMMARY: The U.S. Department of Education (the Department) intends to compromise two audit claims against the Connecticut State Board of Education (Connecticut) now pending before the Office of Administrative Law Judges (OALJ). Docket Nos. 92-53-R and 94-68-R (20 U.S.C. 1234a(j)). DATES: Interested persons may comment on the proposed action by submitting written data, views, or arguments May 9, 1996. ADDRESSES: Comments should be addressed to Effie Forde, Office of the General Counsel, U.S. Department of Education, 600 Independence Avenue, SW., (Room 5200, FB 10), Washington, DC 20202. FOR FURTHER INFORMATION CONTACT: Effie Forde, 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 claims in question arose from two separate audits of the financial affairs and operations of Connecticut for fiscal years 1988 through 1991. The audits were performed by the State of Connecticut Auditor of Public Accounts to fulfill the requirements of Office of Management and Budget (OMB) Circular A-128. The audits included the evaluation of the internal control systems, including applicable internal administrative controls used in administering Federal financial assistance programs. Among the systems examined, the auditors reviewed Connecticut's procedures for allocating among programs costs for individual employees who had multi-program responsibilities. Department officials issued two separate program determination letters (PDLs) to Connecticut. The first PDL was issued on March 31, 1992 demanding a refund in the amount of $575,329 (Connecticut I) for violations of the requirements in OMB Circular A-87 relating to recordkeeping for employees with multi-program responsibilities. Funds were disallowed for the following programs: Bilingual Education State Grant ($94,134); Education Consolidation and Improvement Act (ECIA) Migrant Education State Formula Grant ($108,358); Chapter 1 of the ECIA, Education for the Disadvantaged, State Administration ($36,120); Chapter 2 of the ECIA ($263,605); Part B of the Education of the Handicapped Act ($29,272); and Preschool Grants for Children with Disabilities ($43,910). Based on documentation submitted by Connecticut during the course of its appeal before the OALJ, the Department has withdrawn its claims relating to Chapter 2 of the ECIA ($263,605) and the Bilingual Education State Grant ($94,134). With the withdrawal of these two claims, the funds remaining at issue in Connecticut I have been reduced from $575,329 to $217,590. The Department issued the second PDL on March 25, 1994 (Connecticut II) disallowing a total of $558,162 for similar recordkeeping violations relating to the following Federal programs: Bilingual Education State Grant program ($100,566); Carl D. Perkins Vocational Education Act ($3,133); Chapter 1 Handicapped ($201,438); Chapter 2 of the Elementary and Secondary Education Act (ESEA) ($234,640); and Handicapped Special Studies ($18,385). Based on documentation submitted by Connecticut after it filed its application for review with the OALJ, the Department has withdrawn its claims relating to Chapter 2 of the ESEA ($234,640) and the Bilingual Education State Grant ($100,566). As a result, the amount of funds remaining at issue in Connecticut II is $222,956. Connecticut filed timely requests for review of the two PDLs with the OALJ. Thereafter, the Administrative Law Judge assigned to the appeals granted the parties' joint motion to enter into settlement negotiations. The Department proposes to compromise the amount remaining at issue in Connecticut I ($217,590) for $82,500 and the amount at issue in Connecticut II ($222,956) for $64,260. Under the proposed compromise, Connecticut therefore would repay a total principal amount of $147,760, plus accrued interest, in three equal installments. Although Connecticut I and II are being resolved together through one settlement agreement, they involve separate PDLs and claims for purposes of the dollar limitation in 20 U.S.C. 1234a(j)(1) on the Secretary's authority to compromise claims. During settlement negotiations, Connecticut provided substantial additional documentation and information relating to the individual employees at issue, their job duties, and how they spent their time. Furthermore, Connecticut raised additional legal and factual issues that could reduce or eliminate the remaining amounts at issue. Given the amount that would be repaid by Connecticut under the settlement agreement, the additional documentation submitted during settlement discussions, and the litigation risks and costs of proceeding through the appeal process for both appeals, the Department has determined that it would not be practical or in the public interest to continue these proceedings. Rather, under the authority provided in 20 U.S.C. 1234a(j)(1), the Department has determined that compromise of these claims for $146,760 would be appropriate. The public is invited comment on the Department's intent to compromise these claims. Additional information may be obtained by writing to Effie Forde at the address given at the beginning of this notice. Program Authority: 20 U.S.C. 1234a(j). Dated: March 19, 1996. Donald R. Wurtz, Chief Financial Officer. [FR Doc. 96-7161 Filed 3-22-96; 8:45 am] BILLING CODE 4000-01-P