July 2, 2007

Honorable Thomas M. Dowd

Director

### Office of Indian Education Programs

Bureau of Indian Education

MS-3512, MIB

#### Washington, DC 20240

### Dear Director Dowd:

This is to inform you that we have conditionally approved Bureau of
Indian Education's (BIE's) application for Federal Fiscal Year (FFY)
2007 under Part B of the Individuals with Disabilities Education Act
(IDEA). Our conditional approval is based on review of your application
submitted by BIE to the U.S. Department of Education, Office of Special
Education Programs (OSEP), on May 30, 2007**,** and the revisions
submitted on June 26, 2007, including assurances provided in Section II,
and incorporated by reference to this letter as noted in Enclosure A. In
addition, BIE provided specific assurances that it will:

1.  Operate consistent with the applicable Part B regulations; and

2.  Make such changes to existing policies and procedures as are
    necessary to bring those policies and procedures into compliance
    with the requirements of Part B of the IDEA, as amended, as soon as
    possible, and not later than June 30, 2008. Section II of BIE's
    application identifies the IDEA statutory sections for which BIE
    needs to amend policies and procedures and the timelines by which
    BIE will amend its policies and procedures in order to comply with
    Part B of the IDEA. Within Section II, BIE has included the date by
    which it expects to complete necessary changes associated with any
    policies and procedures that are not yet in compliance with the
    requirements of Part B of the IDEA, as amended.

We consider the May 17, 2007 letter to OSEP and the May 14, 2007
Memorandum to Education Line Officers and School Principals attached to
your application to satisfy the remaining issues identified in June 2006
issues chart. The issues chart required that BIE revise its eligibility
document to address the requirements in 34 CFR §§300.142(b)(2),
300.142(e), and 300.142(f) (now §§300.154(b)(2), 300.154(d), and
300.154(e)) regarding methods of ensuring services. In the May 17, 2007
letter, BIE informed OSEP that subsequent to reauthorization of IDEA
Improvement Act of 2004 (IDEA 2004), BIE provided interim procedures to
all BIE-funded schools. The interim procedures were reiterated in a May
14, 2007 memorandum sent to its Education Line Officers and School
Principals. The memorandum requires all BIE funded schools to comply
with the requirements in 34 CFR §§300.707 through 300.716, which
includes compliance with 34 CFR §300.154, while BIE policies and
procedures that align with IDEA 2004 are finalized. In the May 17, 2007
letter, BIE has assured OSEP that the language in 34 CFR
§§300.154(b)(2), 300.154(d), and 300.154(e) will be included in the
final policies and procedures.

As set forth in Enclosure B, in a June 27, 2007 letter, the Department
informed BIE that it is imposing special conditions on the Department of
Interior's funds due to an unsatisfactory subtask completion rate on
BIE's Program Improvement and Accountability Plan (PIAP), addressing
management and accountability issues in BIE's administration of
Department funds. The requirements of the special conditions are
specified in an attachment to the June 27, 2007 letter.

Enclosed is the Bureau of Indian Affairs' Grants to States award of
\$87,432,898 for funds appropriated for Federal Fiscal Year 2007 under
section 611(b)(2) of Part B of the Individuals with Disabilities
Education Act (IDEA). These funds are for use primarily in school year
2007-2008 and are available for obligation by BIE from July 1, 2007
through September 30, 2009.

Under the section 611(h)(1)(A) of IDEA, the award includes \$69,946,318
to be used by the Secretary of the Interior to meet the need for
assistance for the education of children with disabilities on
reservations aged 5 to 21, inclusive, enrolled in elementary and
secondary schools for Indian children operated for funded by the
Secretary of the Interior. Under section 611(h)(1)(A) of IDEA and 34 CFR
§300.707(b), with the exception of five percent of these funds, which
may be reserved for administrative costs, 80% of the funds must be
allocated to such schools by July 1st and 20% must be allocated to such
schools by September 30th.

Under the section 611(h)(4)(A), the award includes \$17,486,580 to be
distributed by the Secretary of the Interior to tribes or tribal
organization or consortia of the above to provide for the coordination
of assistance for special education and related services for children
with disabilities aged 3 through 5 on reservations served by elementary
and secondary schools for Indian children operated or funded by the
Secretary of Interior. The funds received by a tribe or tribal
organization must be used to assist in child find, screening and other
procedures for the early identification of children aged 3 through 5,
parent training, and the provision of direct services. None of the funds
provided under section 611(h)(4)(A) can be used by the Secretary of the
Interior for administrative purposes, including child count and the
provision of technical assistance.

Please note that as part of your application for FFY 2007, BIE has made
an assurance, in 34 CFR §80.11(c), that it will comply with all
applicable Federal statutes and regulations in effect with respect to
the periods for which it receives grant funding. Any changes made by
BIE, after OSEP approval, to information that is a part of BIE's
application, must meet the public participation requirements in 34 CFR
§300.165.

On March 28, 2007, the Office of the Inspector General (OIG) issued a
final audit report titled Bureau of Indian Affairs (BIA) Administration
of IDEA, Part B Funds. The OIG found, among other things, that BIA was
unable to adequately account for the entire \$111 million of IDEA, Part
B funds appropriated during the audit period (July 1, 2001 through
September 30, 2003) and recommended that that the Assistant Secretary
for Special Education and Rehabilitative Services (OSERS) obtain an
assurance from BIA officials that the \$111 million of IDEA, Part B
funds was used to deliver educational assistance to the children with
disabilities at all of the BIA funded schools and return any funds not
used for those purposes to the Department, to the extent authorized by
law; and instruct the BIA to establish written accounting policies and
procedures to properly account for IDEA, Part B funds and all Department
funds. We note that BIE has assured OSEP in Section II of its
application that funds paid to the BIE will be expended in accordance
with all the provisions of Part B of IDEA.

The enclosed grant award for FFY 2007 is made with the continued
understanding that this Office may, from time to time, require
clarification of information within your application, if necessary.
These inquiries are needed to allow us to appropriately carry out our
administrative responsibilities related to Part B.

Section 606 provides that each recipient of assistance under IDEA make
positive efforts to employ and advance in employment qualified
individuals with disabilities in programs assisted under the IDEA.
Therefore, by accepting this grant BIE is expressly agreeing as a
condition of IDEA funding to ensuring that positive efforts are made to
employ and advance employment of qualified individuals with disabilities
in programs assisted under the IDEA.

We appreciate your ongoing commitment to the provision of quality
educational services to children with disabilities.

> Sincerely,
>
> /s/ Patricia J. Guard
>
> Patricia J. Guard

Acting Director

Office of Special Education Programs

#### Enclosures 

Enclosure A

####  Enclosure B

cc: Director of Special Education