Proposed Priority and Requirements-Technical Assistance on State Data Collection-National Technical Assistance Center To Improve State Capacity To Collect, Report, Analyze, and Use Accurate IDEA Part B and Part C Fiscal Data, 67395-67402 [2019-26477]

Agencies

• DEPARTMENT OF EDUCATION

[Federal Register Volume 84, Number 237 (Tuesday, December 10, 2019)]
[Proposed Rules]
[Pages 67395-67402]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2019-26477]


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DEPARTMENT OF EDUCATION

34 CFR Chapter III

[Docket ID ED-2019-OSERS-0134]


Proposed Priority and Requirements--Technical Assistance on State 
Data Collection--National Technical Assistance Center To Improve State 
Capacity To Collect, Report, Analyze, and Use Accurate IDEA Part B and 
Part C Fiscal Data

AGENCY: Office of Special Education and Rehabilitative Services, 
Department of Education.

ACTION: Proposed priority and requirements.

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SUMMARY: The mission of the Office of Special Education and 
Rehabilitative Services (OSERS) is to improve early childhood, 
educational, and employment outcomes and raise expectations for all 
people with disabilities, their families, their communities, and the 
Nation. As such, the Department of Education (Department) proposes a 
funding priority and requirements under the Technical Assistance on 
State Data Collection program. The Department may use the proposed 
priority for competitions in fiscal year (FY) 2020 and later years. We 
take this action to focus attention on an identified national need to 
provide technical assistance (TA) to improve the capacity of States to 
meet the data collection requirements under Parts B and C of the 
Individuals with Disabilities Education Act (IDEA). The National 
Technical Assistance Center to Improve State Capacity to Collect, 
Report, Analyze, and Use Accurate IDEA Part B and Part C Fiscal Data 
(Fiscal Data Center) would support States in collecting, reporting, and 
determining how to best analyze and use their IDEA Part B and C fiscal 
data to establish and meet high expectations for each child with a 
disability and would customize its TA to meet each State's specific 
needs.

DATES: We must receive your comments on or before February 24, 2020.

ADDRESSES: Submit your comments through the Federal eRulemaking Portal 
or via postal mail, commercial delivery, or hand delivery. We will not 
accept comments submitted by fax or by email or those submitted after 
the comment period. To ensure that we do not receive duplicate copies, 
please submit your comments only once. In addition, please include the 
Docket ID at the top of your comments.
     Federal eRulemaking Portal: Go to www.regulations.gov to 
submit your comments electronically. Information on using 
Regulations.gov, including instructions for accessing agency documents, 
submitting comments, and viewing the docket, is available on the site 
under ``Help.''
     Postal Mail, Commercial Delivery, or Hand Delivery: If you 
mail or deliver your comments, address them to Charles Kniseley, U.S. 
Department of Education, 400 Maryland Avenue SW, Room 5133, Potomac 
Center Plaza, Washington, DC 20202-5076.
    Privacy Note: The Department's policy is to make all comments 
received from members of the public available for public viewing in 
their entirety on the Federal eRulemaking Portal at 
www.regulations.gov. Therefore, commenters should be careful to include 
in their comments only information that they wish to make publicly 
available.

FOR FURTHER INFORMATION CONTACT: Charles Kniseley, U.S. Department of 
Education, 400 Maryland Avenue SW, Room 5133, Potomac Center Plaza, 
Washington, DC 20202-5076. Telephone: (202) 245-7322. Email: 
[email protected].
    If you use a telecommunications device for the deaf (TDD) or a text 
telephone (TTY), call the Federal Relay Service (FRS), toll free, at 1-
800-877-8339.

SUPPLEMENTARY INFORMATION: 
[Catalog of Federal Domestic Assistance (CFDA) Number: 84.373F.]

    Invitation to Comment: We invite you to submit comments regarding 
the proposed priority and requirements. To ensure that your comments 
have maximum effect in developing the notice of final priority and 
requirements we urge you to clearly identify the specific topic that 
each comment addresses.
    We are particularly interested in comments about whether the 
proposed priority or any of the proposed requirements would be 
challenging for new applicants to meet and, if so, how the proposed 
priority or requirements could be revised to address potential 
challenges.
    We invite you to assist us in complying with the specific 
requirements of Executive Orders 12866, 13563, and 13771 and their 
overall requirement of reducing regulatory burden that might result 
from this proposed priority and these proposed requirements. Please let 
us know of any further ways we could reduce potential costs or increase 
potential benefits while preserving the effective and efficient 
administration of the program.
    During and after the comment period, you may inspect all public 
comments about the proposed priority and requirements by accessing 
Regulations.gov. You may also inspect the comments in person in room 
5133, 550 12th Street SW, Potomac Center Plaza, Washington, DC, between 
the hours of 8:30 a.m. and 4:00 p.m., Eastern Time, Monday through 
Friday of each week except Federal holidays.
    Assistance to Individuals With Disabilities in Reviewing the 
Rulemaking Record: On request, we will provide an appropriate 
accommodation or auxiliary aid to an individual with a disability who 
needs assistance to review the comments or other documents in the 
public rulemaking record for the proposed priority and requirements. If 
you want to schedule an appointment for this type of accommodation or 
auxiliary aid, please contact the person listed under FOR FURTHER 
INFORMATION CONTACT.
    Purpose of Program: The purpose of the Technical Assistance on 
State Data Collection program is to improve the capacity of States to 
meet IDEA data collection and reporting requirements. Funding for the 
program is authorized under section 611(c)(1) of IDEA, which gives the 
Secretary the authority to reserve not more than one-half of 1 percent 
of the amounts appropriated under Part B for each fiscal year to 
provide TA activities authorized under section 616(i), where needed, to 
improve the capacity of States to meet the data collection requirements 
under Parts B and C of IDEA. The maximum amount the Secretary may 
reserve under this set-aside for any fiscal year is

[[Page 67396]]

$25,000,000, cumulatively adjusted by the rate of inflation. Section 
616(i) of IDEA requires the Secretary to review the data collection and 
analysis capacity of States to ensure that data and information 
determined necessary for the implementation of section 616 of IDEA are 
collected, analyzed, and accurately reported to the Secretary. It also 
requires the Secretary to provide TA (from funds reserved under section 
611(c)(1)), where needed, to improve the capacity of States to meet the 
data collection requirements under Parts B and C of IDEA, which include 
the data collection and reporting requirements in sections 616 and 618 
of IDEA. Additionally, the Department of Defense and Labor, Health and 
Human Services, and Education Appropriations Act, 2019 and Continuing 
Appropriations Act, 2019 gives the Secretary the authority to use funds 
reserved under section 611(c) to ``administer and carry out other 
services and activities to improve data collection, coordination, 
quality, and use under parts B and C of the IDEA.'' Department of 
Defense and Labor, Health and Human Services, and Education 
Appropriations Act, 2019 and Continuing Appropriations Act, 2019; Div. 
B, Title III of Public Law 115-245; 132 Stat. 3100 (2018).
    To help ensure this program meets State needs, we invited the 
public to provide input on the Technical Assistance on State Data 
Collection program from April 24, 2018, through May 24, 2018, on the 
ED.gov OSERS Blog.\1\ In response to this invitation, we received 63 
relevant responses, all of which we considered in our development of 
this document. Sixty-two supported our continuing to fund TA centers; 
only one supported one of the other options we presented, specifically, 
to invite State educational agencies (SEAs) and State lead agencies 
(LAs) to directly apply for funds reserved under section 611(c) to 
purchase TA to improve their capacity to meet their IDEA Part B and 
Part C data collection requirements. A few commenters noted some 
concerns regarding overlap between TA centers and a need for cross-
State collaboration TA opportunities.
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    \1\ See https://sites.ed.gov/osers/2018/04/use-of-part-b-program-funds-for-technical-assistance-to-states-on-idea-data-collection/.
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    We address these concerns in the proposed priority by (1) including 
a requirement for the Fiscal Data Center to offer cross-State 
collaboration TA opportunities; and (2) clarifying that the scope of 
the Fiscal Data Center will be distinct from the scope of two separate 
centers that will provide TA on other non-fiscal data: The National 
Technical Assistance Center to Improve State Capacity to Collect, 
Report, Analyze, and Use Accurate IDEA Part B Data, CFDA number 
84.373Y, and the National Technical Assistance Center to Improve State 
Capacity to Collect, Report, Analyze, and Use Accurate Early Childhood 
IDEA Data, CFDA number 84.373Z, for which the notices of final priority 
and requirements (NFP) were published in the Federal Register on August 
12, 2019 (84 FR 39736 and 84 FR 39727).
    Program Authority: 20 U.S.C. 1411(c), 1416(i), 1418(c), and 1442; 
the Department of Defense and Labor, Health and Human Services, and 
Education Appropriations Act, 2019 and Continuing Appropriations Act, 
2019; Div. B, Title III of Public Law 115-245, Consolidated 
Appropriations Act, 2019; 132 Stat. 3100 (2018).
    Applicable Program Regulations: 34 CFR 300.702.
    Proposed Priority: The Assistant Secretary proposes the following 
priority for this program. We may apply this proposed priority in any 
year in which this program is in effect.

National Technical Assistance Center To Improve State Capacity To 
Collect, Report, Analyze, and Use Accurate IDEA Part B and Part C 
Fiscal Data

    Background: The purpose of this proposed priority is to establish a 
Fiscal Data Center to provide States with TA to assist them in meeting 
their fiscal data collection and reporting obligations under IDEA. 
Under Part B of IDEA, State educational agencies (SEAs) are required to 
submit fiscal data to the Department in (1) the IDEA Part B local 
educational agency (LEA) Maintenance of Effort (MOE) Reduction and 
Coordinated Early Intervening Services (CEIS) (LEA MOE/CEIS) Data 
Collection; and (2) Section V of the IDEA Part B Annual Application. 
Under IDEA Part C, State lead agencies (LAs) are also required to 
report fiscal data to the Department in (1) Section III of the IDEA 
Part C Annual Application (use of funds); and (2) Section IV of the 
IDEA Part C Annual Application (indirect costs).
    In reviewing the data submitted by States, the Department finds 
that States continue to need support to build their capacity to submit 
valid and reliable IDEA Part B and Part C fiscal data. It is important 
for these data to be accurate so that States can use them to more 
effectively manage all available funding resources for services for 
children with disabilities and ensure that IDEA funds are used as a 
payor of last resort. In addition, under IDEA Part B, States may suffer 
significant monetary consequences as a result of inaccurate data 
reporting or noncompliance identified through these data collections.

Data Under IDEA Part B

    In FY 2014 the Department funded the Technical Assistance on State 
Data Collection--IDEA Fiscal Data Center, which provided TA to improve 
the capacity of States to meet the following IDEA Part B fiscal data 
collection requirements under section 618 of IDEA: (1) Maintenance of 
State Financial Support (MFS) for special education and related 
services; and (2) LEA MOE/CEIS.
    Since that time, the Department added new data elements to the LEA 
MOE/CEIS data collection based on the final LEA MOE regulations that 
were published in the Federal Register on April 28, 2015 (80 FR 23644), 
and States will need to ensure that the data they submit under those 
new elements are valid and reliable. In addition, the Department 
continues to identify errors in States' Part B LEA MOE/CEIS data 
submissions through its annual review process. Finally, based on the 
Office of Special Education Programs' (OSEP) monitoring visits and 
subsequent fiscal findings in several States, OSEP has determined that 
States continue to need support in understanding the requirements 
relating to the data elements reported under the LEA MOE/CEIS data 
collection.
    For example, OSEP has identified noncompliance in the methodologies 
used by some States to calculate the amounts of their LEAs' IDEA Part B 
subgrants. This type of noncompliance has broader implications for LEAs 
and States that receive increased or decreased funding for special 
education and related services. As an illustration of the potential 
impact of fiscal noncompliance, an error in calculating the amount of 
an LEA's IDEA Part B allocation affects the amounts the LEA may expend 
to meet other fiscal requirements, such as LEA MOE reduction under 34 
CFR 300.205, voluntary CEIS under 34 CFR 300.226(a), comprehensive CEIS 
under 34 CFR 300.646(d), and proportionate share for parentally placed 
private school children with disabilities under 34 CFR 300.133. Based 
on the complexities and high stakes involved in reporting valid and 
reliable IDEA Part B fiscal data, the Department determined that States 
continue to need TA to improve their data collection capacity, their 
ability to analyze and use that data, and their ability to ensure data

[[Page 67397]]

are accurate and can be reported to the Department and the public.\2\
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    \2\ The Department's FY 2014 notice of proposed priority (79 FR 
24661) provided information on the challenges States face in 
understanding, submitting, analyzing and using IDEA Part B fiscal 
data.
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    Accurately collecting and reporting valid and reliable IDEA Part B 
fiscal data is critically important for States and LEAs. Failure of a 
State to report accurate data on MFS may result in a reduction of IDEA 
Part B section 611 funds. Failure of an LEA to meet LEA MOE may result 
in repayment by the SEA of non-Federal funds to the Department. In 
addition, accurate fiscal information is needed for States to make 
informed decisions on the use of their IDEA Part B funds. Finally, 
valid and reliable fiscal data allow OSEP to better protect the Federal 
interest in the approximately $13.2 billion of IDEA Part B grants made 
available to States by the Department in Federal fiscal year (FFY) 2019 
by ensuring that States and LEAs meet their obligation to collect and 
report accurate data on IDEA's MFS and LEA MOE requirements.
    TA on collecting, reporting, analyzing, and using other IDEA Part B 
and Part C data reported under sections 616 and 618 of IDEA would be 
provided by the National Technical Assistance Center to Improve State 
Capacity to Collect, Report, Analyze, and Use Accurate IDEA Part B 
Data, CFDA number 84.373Y, and the National Technical Assistance Center 
to Improve State Capacity to Collect, Report, Analyze, and Use Accurate 
Early Childhood IDEA Data, CFDA number 84.373Z, for which notices of 
final priority and requirements (NFP) were published in the Federal 
Register on August 12, 2019 (84 FR 39736 and 84 FR 39727).

Data Under IDEA Part C

    In its review of State submissions of IDEA Part C fiscal data, the 
Department found that States need support to submit accurate, valid, 
and reliable data in two areas: (1) Use of IDEA Part C funds; and (2) 
indirect costs.\3\ In its reviews, OSEP found inconsistencies within 
the fiscal data reported by a State LA and between the fiscal data 
reported and the related fiscal certification and assurances that the 
State must provide in its IDEA Part C Annual Application.
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    \3\ These fiscal data are reported in the following sections of 
the IDEA Part C Application: (1) Section III: Use of Federal IDEA 
Part C Funds for the State LA and the Interagency Coordinating 
Council (ICC); and (2) Section IV.B: Restricted Indirect Cost Rate/
Cost Allocation Plan data, which the Department collects, inter 
alia, under section 618(a)(3) of IDEA.
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    In its IDEA Part C Annual Application, each LA must provide several 
fiscal-related assurances and a fiscal-related certification. 
Specifically, each LA must--(1) ensure its statewide system has a 
single line of responsibility, including: (a) The identification and 
coordination of all available resources for early intervention services 
within the State, including those from Federal, State, local, and 
private sources, consistent with subpart F of 34 CFR part 303; and (b) 
the assignment of financial responsibility in accordance with subpart F 
of 34 CFR part 303 and specifically ensure IDEA Part C funds are used 
as payor of last resort (including any method under IDEA section 640); 
(2) coordinate all available funding sources for IDEA Part C services 
(including its system of payments); (3) use IDEA Part C funds to 
supplement, not supplant, the level of State and local funds expended 
for infants and toddlers with disabilities; and (4) charge 
administrative direct and indirect costs to the Part C grant consistent 
with applicable Federal fiscal requirements.\4\
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    \4\ These assurances are provided in Section II.B., items 13 and 
24. The assurance numbers are from the FFY 2019 IDEA Part C Annual 
State Application, which can be accessed at https://osep.grads360.org/#communities/pdc/documents/17654.
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    In addition, each LA must certify that the arrangements to 
establish financial responsibility for the provision of Part C services 
among appropriate public agencies under 34 CFR 303.511 and the lead 
agency's contracts with early intervention service (EIS) providers 
regarding financial responsibility for the provision of Part C services 
meet the requirements in 34 CFR 303.500 through 303.521 and are current 
as of the date of submission of the certification.\5\ Fiscal data 
related to this certification may need to also be reported in Section 
III of the IDEA Part C Annual State Application under funding for other 
State agencies to the extent Federal IDEA Part C funds are used in 
conjunction with State funding or other support provided by State 
agencies other than the State lead agency.
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    \5\ This is certification number 3 in Section II.C. of the 
application, and it is provided, under IDEA section 640 and 34 CFR 
303.202, in Section II.C. It can be accessed at https://osep.grads360.org/#communities/pdc/documents/17654.
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    In several instances, States' reporting of IDEA Part C fiscal data 
in their applications indicates that there is confusion related to the 
implementation of underlying Part C fiscal requirements. Many States 
need support in understanding the administrative costs that may be 
charged to IDEA Part C grants as direct and indirect costs. 
Additionally, in their annual application numerous States are unable to 
identify or disaggregate the costs for direct services, as well as 
costs attributable to other State agencies, due to confusion regarding 
the fiscal certification, and fiscal assurances regarding the payor of 
last resort, system of payments, methods, and related fiscal 
coordination requirements.
    OSEP's review of the fiscal data in Section III of the IDEA Part C 
application (use of funds) indicates that States need TA in this area. 
This review has identified inconsistencies in data across categories of 
expenses (including direct and indirect costs) and between the fiscal 
data reported by the State and the related fiscal assurances and 
certification regarding funding needed or provided by other State 
agencies (and any methods, such as interagency agreements or other 
appropriate written mechanisms) and the State's related application 
requirements, including its system of payments policies. States' fiscal 
data reflect confusion with the fiscal requirements not only under the 
IDEA Part C statute and regulations, but also the fiscal requirements 
under the Office of Management and Budget (OMB) Uniform Administrative 
Requirements, Cost Principles, and Audit Requirements for Federal 
Awards, codified in 2 CFR part 200 (OMB Uniform Guidance).
    Specifically, OSEP has identified issues with, and States have 
raised questions about, how to report IDEA Part C fiscal data regarding 
the amount of IDEA Part C funds to be used for: (1) Administrative 
costs, such as positions partially or wholly funded by IDEA Part C 
funds, and the amount of fringe benefits (reported in Section III.A.); 
(2) maintenance and implementation activities for the LA and the State 
Interagency Coordinating Council (ICC) (including any costs that 
require prior approval by OSEP, such as equipment, rent, and 
participant support costs for trainings and conferences) (reported in 
Section III.B.); (3) direct services (disaggregated by the type of 
service and expended consistently with IDEA's payor-of-last-resort and 
system of payments requirements) (reported in Section III.C.); and (4) 
activities by other State agencies (reported in Section III.D.). The 
fiscal data in each of these categories reflects a need for TA on the 
requirements in the OMB Uniform Guidance as they apply to IDEA Part C 
LAs and EIS providers.
    OSEP has also found that States need TA with Section III use of 
funds grant amendment requests after the grant is issued to comply with 
fiscal requirements and in order to expend unused IDEA Part C funds 
prior to those funds lapsing. These fiscal requirements

[[Page 67398]]

are also codified in the OMB Uniform Guidance.
    In Section IV.B. of the IDEA Part C application, the LA must report 
on whether the State plans to charge indirect costs to the IDEA Part C 
grant through the use of a restricted indirect cost rate agreement or a 
cost allocation plan that is approved by the LA's Federal cognizant 
agency and provide appropriate documentation.
    Sections III.F.6 and IV.B also require States to indicate that, if 
indirect costs are being charged to the IDEA Part C grant, the State 
must indicate the total amount of the overall Federal IDEA Part C grant 
funds that will be charged for restricted indirect costs and provide 
appropriate approval documentation. If the State charges indirect costs 
to its IDEA Part C grant, then, under 34 CFR 303.225(c), an LA may 
charge them through either: (1) A restricted indirect cost rate 
agreement that meets the requirements in 34 CFR 76.560 through 76.569; 
or (2) a cost allocation plan that meets the non-supplanting 
requirements in 34 CFR 303.225(b) and 34 CFR part 76.\6\ OSEP has 
worked with LAs when it identifies large amounts of IDEA Part C funding 
being reserved for administrative or indirect costs and believes that 
LAs need TA both on reporting indirect cost data to the Department in 
the application and on applying indirect costs and related Federal 
requirements to the IDEA Part C grant. This is particularly relevant to 
LAs that have a cognizant Federal agency other than the Department and 
to ensure that States and LAs meet requirements in Education Department 
General Administrative Regulations and the OMB Uniform Guidance, which 
require indirect costs for IDEA Part C grants to be calculated on a 
restricted basis due to IDEA Part C's nonsupplanting requirement.\7\ 
The Fiscal Data Center would support States in appropriately applying 
their previously negotiated or provisionally approved indirect cost 
rate agreements or a cost allocation plan as described above. The 
Fiscal Data Center would not support LAs in negotiating an indirect 
cost rate agreement with their cognizant agencies.
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    \6\ Approximately three quarters of States have a department of 
health or social services as the LA for Part C. In those cases, the 
U.S. Department of Health and Human Services is the cognizant 
Federal agency for indirect cost purposes. For certain territories, 
the U.S. Department of the Interior is the cognizant Federal agency 
for indirect cost purposes. For LAs that are also SEAs, the 
Department is the cognizant agency for approving the LA's restricted 
indirect cost rate or cost allocation plan. If an LA has a cognizant 
Federal agency other than the Department for determining the LA's 
restricted indirect cost rate or approving its cost allocation plan, 
the LA must attach a copy of the approved restricted indirect cost 
rate agreement or cost allocation plan to the Department in the IDEA 
Part C Annual Application.
    \7\ Appendix VI and Appendix VII to 2 CFR 200.
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    States need TA in reporting valid and reliable IDEA Part C fiscal 
data, understanding the underlying requirements in Section III and 
Section IV of the IDEA Part C Annual State Application, and optimally 
using and analyzing the data submitted to the Department.

Indirect Costs Charged by the Fiscal Data Center to the Grant

    In addition, we propose for this priority to include an indirect 
cost cap that is the lesser of the grantee's actual indirect costs as 
determined by the grantee's negotiated indirect cost rate agreement 
with its cognizant Federal agency and 40 percent of the grantee's 
modified total direct cost (MTDC) base. We believe this cap is 
appropriate as it maximizes the availability of funds for the primary 
TA purposes of this priority. The Department has done an analysis of 
the indirect cost rates for all current TA centers funded under the 
Technical Assistance and Dissemination and Technical Assistance on 
State Data Collection programs as well as other grantees that are 
large, midsize, and small businesses and small nonprofit organizations 
and has found that, in general, total indirect costs charged on these 
grants by these entities were at or below 35 percent of total direct 
costs (TDC). We recognize that, dependent on the structure of the 
investment and activities, the MTDC base could be much smaller than the 
TDC, which would imply a higher indirect cost rate than those 
calculated here. The Department arrived at a 40 percent rate to address 
some of that variation. This would account for a 12 percent variance 
between TDC and MTDC. However, we note that, in the absence of a cap, 
certain entities would likely charge indirect cost rates in excess of 
40 percent of MTDC. Based on our analysis, it appears that those 
entities would likely be larger for-profit and nonprofit organizations, 
but these organizations appear to be outliers when compared to the 
majority of other large businesses as well as the entirety of OSEP's 
grantees. Setting an indirect cost rate cap of 40 percent would be in 
line with the majority of applicants' existing negotiated rates with 
the cognizant Federal agency.
    This proposed priority aligns with two priorities from the 
Secretary's Final Supplemental Priorities and Definitions for 
Discretionary Grant Programs, published in the Federal Register on 
March 2, 2018 (83 FR 9096): Priority 2: Promoting Innovation and 
Efficiency, Streamlining Education With an Increased Focus on Student 
Outcomes, and Providing Increased Value to Students and Taxpayers; and 
Priority 5: Meeting the Unique Needs of Students and Children with 
Disabilities and/or Those With Unique Gifts and Talents.
    The Fiscal Data Center must be operated in a manner consistently 
with nondiscrimination requirements contained in the U.S. Constitution 
and the Federal civil rights laws.
    Proposed Priority: The purpose of this proposed priority is to fund 
a cooperative agreement to establish and operate the National Technical 
Assistance Center to Improve State Capacity to Collect, Report, 
Analyze, and Use Accurate IDEA Part B and Part C Fiscal Data (Fiscal 
Data Center).
    The Fiscal Data Center will provide TA to improve the capacity of 
States to meet the IDEA Part B and C fiscal data collection 
requirements under IDEA section 618 and increase States' knowledge of 
the underlying IDEA fiscal requirements and calculations necessary to 
submit valid and reliable data for the following collections: (1) MFS 
in Section V of the IDEA Part B Annual State Application; (2) LEA MOE/
CEIS; (3) Description of Use of Federal IDEA Part C Funds for the LA 
and the ICC in Section III of the IDEA Part C Annual State Application; 
and (4) Restricted Indirect Cost Rate/Cost Allocation Plan Information 
in Sections III and IV of the IDEA Part C Annual State Application. 
States will also receive TA from the Fiscal Data Center on the 
underlying fiscal requirements of IDEA related to these collections and 
how they impact the States' ability to meet IDEA fiscal data collection 
requirements.
    Note: The Fiscal Data Center may neither provide TA to States on 
negotiating indirect cost rate agreements with their cognizant Federal 
agencies nor act as an agent or representative of States in such 
negotiations.
    The Fiscal Data Center must be designed to achieve, at a minimum, 
the following outcomes:
    (a) Increased capacity of States to collect, report, analyze, and 
use high-quality IDEA Part B and Part C fiscal data;
    (b) Increased State knowledge of underlying statutory and 
regulatory fiscal requirements and the calculations necessary to submit 
valid and reliable fiscal data under IDEA Part B and Part C;
    (c) Improved fiscal infrastructure (e.g., sample interagency 
agreements, standard operating procedures and templates) by 
coordinating and promoting communication and effective

[[Page 67399]]

fiscal data collection and reporting strategies among relevant State 
offices, including SEAs, other State agencies, LEAs, schools, LAs, and 
early intervention service (EIS) programs or providers;
    (d) Increased capacity of States to submit accurate and timely 
fiscal data to enhance current State validation procedures to prevent 
errors in State-reported IDEA data;
    (e) Increased capacity of States to train personnel to meet the 
IDEA fiscal data collection and reporting requirements under section 
618 of IDEA through development of effective tools and resources (e.g., 
templates, tools, calculators, and documentation of State data 
processes); and providing opportunities for in-person and virtual 
cross-State collaboration about IDEA fiscal data collection and 
reporting requirements (required under section 618 of IDEA);
    (f) Improved capacity of SEAs, LEAs, LAs, and EIS programs or 
providers to collect and use IDEA fiscal data to identify issues and 
address those issues through monitoring, TA, and stakeholder 
involvement; and
    (g) Improved IDEA fiscal data validation using results from data 
reviews conducted by the Department to work with States and generate 
tools that can be used by States to accurately communicate fiscal data 
to local consumers (e.g., parents, LEAs, EIS programs or providers, the 
general public) and lead to improvements in the validity and 
reliability of fiscal data required by IDEA.
    Types of Priorities: When inviting applications for a competition 
using one or more priorities, we designate the type of each priority as 
absolute, competitive preference, or invitational through a notice in 
the Federal Register. The effect of each type of priority follows:
    Absolute priority: Under an absolute priority, we consider only 
applications that meet the priority (34 CFR 75.105(c)(3)).
    Competitive preference priority: Under a competitive preference 
priority, we give competitive preference to an application by (1) 
awarding additional points, depending on the extent to which the 
application meets the priority (34 CFR 75.105(c)(2)(i)); or (2) 
selecting an application that meets the priority over an application of 
comparable merit that does not meet the priority (34 CFR 
75.105(c)(2)(ii)).
    Invitational priority: Under an invitational priority, we are 
particularly interested in applications that meet the priority. 
However, we do not give an application that meets the priority a 
preference over other applications (34 CFR 75.105(c)(1)).
    Proposed Requirements: The Assistant Secretary proposes the 
following requirements for this program. We may apply one or more of 
these proposed requirements in any year in which this program is in 
effect.
    Applicants must--
    (a) Describe, in the narrative section of the application under 
``Significance,'' how the proposed project will--
    (1) Use knowledge of how SEAs, LAs, LEAs, and EIS programs and 
providers are meeting IDEA Part B and Part C fiscal data collection and 
reporting requirements and the underlying statutory and regulatory 
fiscal requirements, as well as knowledge of State and local data 
collection systems, as appropriate;
    (2) Examine applicable national, State, and local data to determine 
the current capacity needs of SEAs, LAs, LEAs, and EIS programs and 
providers to meet IDEA Part B and Part C fiscal data collection and 
reporting requirements;
    (3) Train SEAs and LAs on how to use IDEA section 618 fiscal data 
as a means of both improving data quality and identifying programmatic 
strengths and areas for improvement; and
    (4) Disseminate information regarding how SEAs and LAs are 
currently meeting IDEA fiscal data collection and reporting 
requirements and are using IDEA section 618 data as a means of both 
improving data quality and identifying programmatic strengths and areas 
for improvement.
    (b) Demonstrate, in the narrative section of the application under 
``Quality of project services,'' how the proposed project will--
    (1) Ensure equal access and treatment for members of groups that 
have traditionally been underrepresented based on race, color, national 
origin, gender, age, or disability. To meet this requirement, the 
applicant must describe how it will--
    (i) Identify the needs of the intended recipients for TA and 
information; and
    (ii) Ensure that services and products meet the needs of the 
intended recipients of the grant;
    (2) Achieve its goals, objectives, and intended outcomes. To meet 
this requirement, the applicant must provide--
    (i) Measurable intended project outcomes; and
    (ii) In Appendix A, the logic model (as defined in 34 CFR 77.1) by 
which the proposed project will achieve its intended outcomes that 
depicts, at a minimum, the goals, activities, outputs, and intended 
outcomes of the proposed project;
    (3) Use a conceptual framework to develop project plans and 
activities, describing any underlying concepts, assumptions, 
expectations, beliefs, or theories, as well as the presumed 
relationships or linkages among these variables, and any empirical 
support for this framework. Include a copy of the conceptual framework 
in Appendix A;
    Note: The following websites provide more information on logic 
models and conceptual frameworks: www.osepideasthatwork.org/logicModel 
and www.osepideasthatwork.org/resources-grantees/program-areas/ta-ta/tad-project-logic-model-and-conceptual-framework.
    (4) Be based on current research and make use of evidence-based 
practices (EBPs).\8\ To meet this requirement, the applicant must 
describe--
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    \8\ For the purposes of this priority, ``evidence-based'' means 
the proposed project component is supported, at a minimum, by 
evidence that demonstrates a rationale (as defined in 34 CFR 77.1), 
where a key project component included in the project's logic model 
is informed by research or evaluation findings that suggest the 
project component is likely to improve relevant outcomes.
---------------------------------------------------------------------------

    (i) The current research on fiscal data management and data system 
integration, and related EBPs; and
    (ii) How the proposed project will incorporate current research and 
EBPs in the development and delivery of its products and services;
    (5) Develop products and provide services that are of high quality 
and sufficient intensity and duration to achieve the intended outcomes 
of the proposed project. To address this requirement, the applicant 
must describe--
    (i) How it proposes to identify or develop the knowledge base on 
fiscal data management and data system integration and the underlying 
fiscal requirements of IDEA;
    (ii) Its proposed approach to universal, general TA,\9\ which must 
identify the intended recipients, including the type and number of 
recipients, that will receive the products and services under this 
approach;
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    \9\ ``Universal, general TA'' means TA and information provided 
to independent users through their own initiative, resulting in 
minimal interaction with TA center staff and including one-time, 
invited or offered conference presentations by TA center staff. This 
category of TA also includes information or products, such as 
newsletters, guidebooks, or research syntheses, downloaded from the 
TA center's website by independent users. Brief communications by TA 
center staff with recipients, either by telephone or email, are also 
considered universal, general TA.
---------------------------------------------------------------------------

    (iii) Its proposed approach to targeted, specialized TA,\10\ which 
must identify--
---------------------------------------------------------------------------

    \10\ ``Targeted, specialized TA'' means TA services based on 
needs common to multiple recipients and not extensively 
individualized. A relationship is established between the TA 
recipient and one or more TA center staff. This category of TA 
includes one-time, labor-intensive events, such as facilitating 
strategic planning or hosting regional or national conferences. It 
can also include episodic, less labor-intensive events that extend 
over a period of time, such as facilitating a series of conference 
calls on single or multiple topics that are designed around the 
needs of the recipients. Facilitating communities of practice can 
also be considered targeted, specialized TA.

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[[Page 67400]]

    (A) The intended recipients, including the type and number of 
recipients, that will receive the products and services under this 
approach;
    (B) Its proposed approach to measure the readiness of potential TA 
recipients to work with the project, assessing, at a minimum, their 
current infrastructure, available resources, and ability to build 
capacity at the State and local levels; and
    (C) The process by which the proposed project will collaborate with 
OSEP-funded centers and other federally funded TA centers to develop 
and implement a coordinated TA plan when such other centers are 
involved in a State; and
    (iv) Its proposed approach to intensive, sustained TA,\11\ which 
must identify--
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    \11\ ``Intensive, sustained TA'' means TA services often 
provided on-site and requiring a stable, ongoing relationship 
between the TA center staff and the TA recipient. ``TA services'' 
are defined as negotiated series of activities designed to reach a 
valued outcome. This category of TA should result in changes to 
policy, program, practice, or operations that support increased 
recipient capacity or improved outcomes at one or more systems 
levels.
---------------------------------------------------------------------------

    (A) The intended recipients, including the type and number of 
recipients, that will receive the products and services under this 
approach;
    (B) Its proposed approach to addressing States' challenges 
reporting high-quality IDEA fiscal data to the Department and the 
public, which should, at a minimum, include providing on-site 
consultants to the SEA or LA to--
    (1) Assess all 57 IDEA Part C programs to determine LA 
organizational structure and their capacity to submit valid and 
reliable IDEA Part C fiscal data;
    (2) Assess all 60 entities that receive IDEA Part B grants to 
determine their capacity to submit valid and reliable IDEA Part B 
fiscal data;
    (3) Identify and document model practices for data management and 
data system integration policies, procedures, processes, and activities 
within the State;
    (4) Develop and adapt tools and provide technical solutions to meet 
State-specific data needs; and
    (5) Develop a sustainability plan for the State to continue the 
data management and data system integration work in the future;
    (C) Its proposed approach to measure the readiness of SEAs and LAs 
to work with the project, including their commitment to the initiative, 
alignment of the initiative to their needs, current infrastructure, 
available resources, and ability to build capacity at the State and 
local levels;
    (D) Its proposed plan to prioritize States with the greatest need 
for intensive TA to receive products and services;
    (E) Its proposed plan for assisting SEAs and LAs to build or 
enhance training systems that include professional development based on 
adult learning principles and coaching;
    (F) Its proposed plan for working with appropriate levels of the 
education system (e.g., SEAs, regional TA providers, districts, local 
programs, families) to ensure that there is communication between each 
level and that there are systems in place to support the collection, 
reporting, analysis, and use of high-quality IDEA fiscal data as well 
as fiscal data management and data system integration; and
    (G) The process by which the proposed project will collaborate with 
OSEP-funded centers and other federally funded TA centers to develop 
and implement a coordinated TA plan when they are involved in a State;
    (6) Develop products and implement services that maximize 
efficiency. To address this requirement, the applicant must describe--
    (i) How the proposed project will use technology to achieve the 
intended project outcomes;
    (ii) With whom the proposed project will collaborate and the 
intended outcomes of this collaboration; and
    (iii) How the proposed project will use non-project resources to 
achieve the intended project outcomes.
    (c) In the narrative section of the application under ``Quality of 
the project evaluation,'' include an evaluation plan for the project 
developed in consultation with and implemented by a third-party 
evaluator.\12\ The evaluation plan must--
---------------------------------------------------------------------------

    \12\ A ``third-party'' evaluator is an independent and impartial 
program evaluator who is contracted by the grantee to conduct an 
objective evaluation of the project. This evaluator must not have 
participated in the development or implementation of any project 
activities, except for the evaluation activities, nor have any 
financial interest in the outcome of the evaluation.
---------------------------------------------------------------------------

    (1) Articulate formative and summative evaluation questions, 
including important process and outcome evaluation questions. These 
questions should be related to the project's proposed logic model 
required in paragraph (b)(2)(ii) of these requirements;
    (2) Describe how progress in and fidelity of implementation, as 
well as project outcomes, will be measured to answer the evaluation 
questions. Specify the measures and associated instruments or sources 
for data appropriate to the evaluation questions. Include information 
regarding reliability and validity of measures where appropriate;
    (3) Describe strategies for analyzing data and how data collected 
as part of this plan will be used to inform and improve service 
delivery over the course of the project and to refine the proposed 
logic model and evaluation plan, including subsequent data collection;
    (4) Provide a timeline for conducting the evaluation and include 
staff assignments for completing the plan. The timeline must indicate 
that the data will be available annually for the Annual Performance 
Report (APR); and
    (5) Dedicate sufficient funds in each budget year to cover the 
costs of developing or refining the evaluation plan in consultation 
with a third-party evaluator, as well as the costs associated with the 
implementation of the evaluation plan by the third-party evaluator.
    (d) Demonstrate, in the narrative section of the application under 
``Adequacy of resources,'' how--
    (1) The proposed project will encourage applications for employment 
from persons who are members of groups that have traditionally been 
underrepresented based on race, color, national origin, gender, age, or 
disability, as appropriate;
    (2) The proposed key project personnel, consultants, and 
subcontractors have the qualifications and experience to carry out the 
proposed activities and achieve the project's intended outcomes;
    (3) The applicant and any key partners have adequate resources to 
carry out the proposed activities;
    (4) The proposed costs are reasonable in relation to the 
anticipated results and benefits, and funds will be spent in a way that 
increases their efficiency and cost-effectiveness, including by 
reducing waste or achieving better outcomes; and
    (5) The applicant will ensure that it will recover the lesser of: 
(i) Its actual indirect costs as determined by the grantee's negotiated 
indirect cost rate agreement with its cognizant Federal agency; and 
(ii) 40 percent of its modified total direct cost (MTDC) base as 
defined in 2 CFR 200.68.

[[Page 67401]]

    Note: The MTDC is different from the total amount of the grant. 
Additionally, the MTDC is not the same as calculating a percentage of 
each or a specific expenditure category. If the grantee is billing 
based on the MTDC base, the grantee must make its MTDC documentation 
available to the program office and the Department's Indirect Cost 
Unit. If a grantee's allocable indirect costs exceed 40 percent of its 
MTDC as defined in 2 CFR 200.68, the grantee may not recoup the excess 
by shifting the cost to other grants or contracts with the U.S. 
Government, unless specifically authorized by legislation. The grantee 
must use non-Federal revenue sources to pay for such unrecovered costs.
    (e) Demonstrate, in the narrative section of the application under 
``Quality of the management plan,'' how--
    (1) The proposed management plan will ensure that the project's 
intended outcomes will be achieved on time and within budget. To 
address this requirement, the applicant must describe--
    (i) Clearly defined responsibilities for key project personnel, 
consultants, and subcontractors, as applicable; and
    (ii) Timelines and milestones for accomplishing the project tasks;
    (2) Key project personnel and any consultants and subcontractors 
will be allocated and how these allocations are appropriate and 
adequate to achieve the project's intended outcomes;
    (3) The proposed management plan will ensure that the products and 
services provided are of high quality, relevant, and useful to 
recipients; and
    (4) The proposed project will benefit from a diversity of 
perspectives, including those of families, educators, TA providers, 
researchers, and policy makers, among others, in its development and 
operation.
    (f) Address the following application requirements:
    (1) Include, in Appendix A, personnel-loading charts and timelines, 
as applicable, to illustrate the management plan described in the 
narrative;
    (2) Include, in the budget, attendance at the following:
    (i) A one and one-half day kick-off meeting in Washington, DC, 
after receipt of the award, and an annual planning meeting in 
Washington, DC, with the OSEP project officer and other relevant staff 
during each subsequent year of the project period.
    Note: Within 30 days of receipt of the award, a post-award 
teleconference must be held between the OSEP project officer and the 
grantee's project director or other authorized representative;
    (ii) A two and one-half day project directors' conference in 
Washington, DC, during each year of the project period; and
    (iii) Three annual two-day trips to attend Department briefings, 
Department-sponsored conferences, and other meetings, as requested by 
OSEP;
    (3) Include, in the budget, a line item for an annual set-aside of 
5 percent of the grant amount to support emerging needs that are 
consistent with the proposed project's intended outcomes, as those 
needs are identified in consultation with, and approved by, the OSEP 
project officer. With approval from the OSEP project officer, the 
project must reallocate any remaining funds from this annual set-aside 
no later than the end of the third quarter of each budget period;
    (4) Maintain a high-quality website, with an easy-to-navigate 
design, that meets government or industry-recognized standards for 
accessibility;
    (5) Include, in Appendix A, an assurance to assist OSEP with the 
transfer of pertinent resources and products and to maintain the 
continuity of services to States during the transition to this new 
award period and at the end of this award period, as appropriate; and
    (6) Budget at least 50 percent of the grant award for providing 
intensive, sustained TA.
    Final Priority and Requirements: We will announce the final 
priority and requirements in a document in the Federal Register. We 
will determine the final priority and requirements after considering 
public comments and other information available to the Department. This 
document does not preclude us from proposing additional priorities or 
requirements, subject to meeting applicable rulemaking requirements.

    Note: This document does not solicit applications. In any year 
in which we choose to use this proposed priority and one or more of 
these proposed requirements, we invite applications through a notice 
in the Federal Register.

Executive Orders 12866, 13563, and 13771

Regulatory Impact Analysis

    Under Executive Order 12866, OMB determines whether this regulatory 
action is ``significant'' and, therefore, subject to the requirements 
of the Executive order and subject to review by OMB. Section 3(f) of 
Executive Order 12866 defines a ``significant regulatory action'' as an 
action likely to result in a rule that may--
    (1) Have an annual effect on the economy of $100 million or more, 
or adversely affect a sector of the economy, productivity, competition, 
jobs, the environment, public health or safety, or State, local, or 
Tribal governments or communities in a material way (also referred to 
as an ``economically significant'' rule);
    (2) Create serious inconsistency or otherwise interfere with an 
action taken or planned by another agency;
    (3) Materially alter the budgetary impacts of entitlement grants, 
user fees, or loan programs or the rights and obligations of recipients 
thereof; or
    (4) Raise novel legal or policy issues arising out of legal 
mandates, the President's priorities, or the principles stated in the 
Executive order.
    OMB has determined that this proposed regulatory action is not a 
significant regulatory action subject to review by OMB under section 
3(f) of Executive Order 12866.
    Under Executive Order 13771, for each new rule that the Department 
proposes for notice and comment or otherwise promulgates that is a 
significant regulatory action under Executive Order 12866 and that 
imposes total costs greater than zero, it must identify two 
deregulatory actions. For FY 2020, any new incremental costs associated 
with a new rule must be fully offset by the elimination of existing 
costs through deregulatory actions. Because the proposed regulatory 
action is not significant, the requirements of Executive Order 13771 do 
not apply.
    We have also reviewed this proposed regulatory action under 
Executive Order 13563, which supplements and explicitly reaffirms the 
principles, structures, and definitions governing regulatory review 
established in Executive Order 12866. To the extent permitted by law, 
Executive Order 13563 requires that an agency--
    (1) Propose or adopt regulations only upon a reasoned determination 
that their benefits justify their costs (recognizing that some benefits 
and costs are difficult to quantify);
    (2) Tailor its regulations to impose the least burden on society, 
consistent with obtaining regulatory objectives and taking into 
account--among other things and to the extent practicable--the costs of 
cumulative regulations;
    (3) In choosing among alternative regulatory approaches, select 
those approaches that maximize net benefits (including potential 
economic, environmental, public health and safety, and other 
advantages; distributive impacts; and equity);
    (4) To the extent feasible, specify performance objectives, rather 
than the

[[Page 67402]]

behavior or manner of compliance a regulated entity must adopt; and
    (5) Identify and assess available alternatives to direct 
regulation, including economic incentives--such as user fees or 
marketable permits--to encourage the desired behavior, or provide 
information that enables the public to make choices.
    Executive Order 13563 also requires an agency ``to use the best 
available techniques to quantify anticipated present and future 
benefits and costs as accurately as possible.'' The Office of 
Information and Regulatory Affairs of OMB has emphasized that these 
techniques may include ``identifying changing future compliance costs 
that might result from technological innovation or anticipated 
behavioral changes.''
    We are issuing the proposed priority and requirements only on a 
reasoned determination that their benefits justify their costs. In 
choosing among alternative regulatory approaches, we selected those 
approaches that maximize net benefits. Based on the analysis that 
follows, the Department believes that this regulatory action is 
consistent with the principles in Executive Order 13563.
    We also have determined that this regulatory action would not 
unduly interfere with State, local, and Tribal governments in the 
exercise of their governmental functions.
    In accordance with both Executive orders, the Department has 
assessed the potential costs and benefits, both quantitative and 
qualitative, of this regulatory action. The potential costs are those 
resulting from statutory requirements and those we have determined as 
necessary for administering the Department's programs and activities.
    In addition, we have considered the potential benefits of this 
regulatory action and have noted these benefits in the background 
section of this document.

Paperwork Reduction Act of 1995

    The proposed priority and requirements contain information 
collection requirements that are approved by OMB under OMB control 
number 1894-0006; the proposed priority and requirements do not affect 
the currently approved data collection.
    Regulatory Flexibility Act Certification: The Secretary certifies 
that this proposed regulatory action would not have a significant 
economic impact on a substantial number of small entities. The U.S. 
Small Business Administration Size Standards define ``small entities'' 
as for-profit or nonprofit institutions with total annual revenue below 
$7,000,000 or, if they are institutions controlled by small 
governmental jurisdictions (that are comprised of cities, counties, 
towns, townships, villages, school districts, or special districts), 
with a population of less than 50,000.
    The small entities that this proposed regulatory action would 
affect are SEAs; LEAs, including charter schools that operate as LEAs 
under State law; institutions of higher education; other public 
agencies; private nonprofit organizations; freely associated States and 
outlying areas; Indian Tribes or Tribal organizations; and for-profit 
organizations. We believe that the costs imposed on an applicant by the 
proposed priority and requirements would be limited to paperwork burden 
related to preparing an application and that the benefits of this 
proposed priority and these proposed requirements would outweigh any 
costs incurred by the applicant.
    Participation in the Technical Assistance on State Data Collection 
program is voluntary. For this reason, the proposed priority and 
requirements would impose no burden on small entities unless they 
applied for funding under the program. We expect that in determining 
whether to apply for Technical Assistance on State Data Collection 
program funds, an eligible entity would evaluate the requirements of 
preparing an application and any associated costs, and weigh them 
against the benefits likely to be achieved by receiving a Technical 
Assistance on State Data Collection program grant. An eligible entity 
would probably apply only if it determines that the likely benefits 
exceed the costs of preparing an application.
    We believe that the proposed priority and requirements would not 
impose any additional burden on a small entity applying for a grant 
than the entity would face in the absence of the proposed action. That 
is, the length of the applications those entities would submit in the 
absence of the proposed regulatory action and the time needed to 
prepare an application would likely be the same.
    This proposed regulatory action would not have a significant 
economic impact on a small entity once it receives a grant because it 
would be able to meet the costs of compliance using the funds provided 
under this program. We invite comments from small eligible entities as 
to whether they believe this proposed regulatory action would have a 
significant economic impact on them and, if so, request evidence to 
support that belief.
    Intergovernmental Review: This program is subject to Executive 
Order 12372 and the regulations in 34 CFR part 79. One of the 
objectives of the Executive order is to foster an intergovernmental 
partnership and a strengthened federalism. The Executive order relies 
on processes developed by State and local governments for coordination 
and review of proposed Federal financial assistance.
    This document provides early notification of our specific plans and 
actions for this program.
    Accessible Format: Individuals with disabilities can obtain this 
document in an accessible format (e.g., braille, large print, 
audiotape, or compact disc) on request to the program contact person 
listed under FOR FURTHER INFORMATION CONTACT.
    Electronic Access to This Document: The official version of this 
document is the document published in the Federal Register. You may 
access the official edition of the Federal Register and the Code of 
Federal Regulations at www.govinfo.gov. At this site you can view this 
document, as well as all other documents of this Department published 
in the Federal Register, in text or Portable Document Format (PDF). To 
use PDF you must have Adobe Acrobat Reader, which is available free at 
the site.
    You may also access documents of the Department published in the 
Federal Register by using the article search feature at 
www.federalregister.gov. Specifically, through the advanced search 
feature at this site, you can limit your search to documents published 
by the Department.

Mark Schultz,
Delegated the authority to perform the functions and duties of the 
Assistant Secretary for the Office of Special Education and 
Rehabilitative Services.
[FR Doc. 2019-26477 Filed 12-9-19; 8:45 am]
BILLING CODE 4000-01-P