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###### Department of Education

# AGENCY:

Department of Education.

# ACTION:

Notice of intent to compromise claim with request for comments.

# SUMMARY:

                        The United States Department of Education (Department) intends to compromise a claim against the District of Columbia Public Schools (DCPS) now pending before the Office of Administrative Law Judges (OALJ), Docket No. 07-42-R. Before compromising a claim, the Department must publish its intent to do so in the                         **Federal Register**                         and provide the public an opportunity to comment on that action.                    

# DATES:

We must receive your comments on the proposed action on or before May 16, 2011.

# ADDRESSES:

Address all comments concerning the proposed action to Ronald B. Petracca, Office of the General Counsel, U.S. Department of Education, 400 Maryland Avenue, SW., room 6C111, Washington, DC 20202-2110.

# FOR FURTHER INFORMATION CONTACT:

                        Ronald B. Petracca. Telephone: (202) 401-6008. If you use a telecommunications device for the deaf (TDD), call the Federal Relay Service (FRS), toll free, at 1-800-877-8339. Individuals with disabilities can obtain this document in an accessible format (                        *e.g.,*                         braille, large print, audio tape, or computer diskette) on request to the contact person listed under                         **FOR FURTHER INFORMATION CONTACT**                        .                    

# SUPPLEMENTARY INFORMATION:

## Invitation To Comment

We invite you to submit comments regarding this proposed action. During and after the comment period, you may inspect all public comments about this notice in room 6E312, FB-6, 400 Maryland Avenue, SW., Washington, DC, between the hours of 8:30 a.m. and 4:00 p.m., Washington, DC time, Monday through Friday of each week except Federal holidays.

## Assistance to Individuals With Disabilities in Reviewing Comments

                    On request, we will supply an appropriate aid, such as a reader or print magnifier, to an individual with a disability who needs assistance to review the comments. If you want to schedule an appointment for this type of aid, please contact the person listed under                     **FOR FURTHER INFORMATION CONTACT**                    .                

## Background

On July 12, 2007, the Assistant Secretary for Elementary and Secondary Education and the Assistant Secretary for Special Education and Rehabilitative Services (collectively, the Assistant Secretaries) jointly issued a program determination letter (PDL) seeking to recover from DCPS $1,354,679 in funds under Title I, Part A (Title I) of the Elementary and Secondary Education Act of 1965 (ESEA), Title I, Part B, Subpart 1 of the ESEA (Reading First), Title II, Part A of the ESEA (Improving Teacher Quality or ITQ), and Part B of the Individuals with Disabilities Education Act (IDEA-B). These funds, based on findings in a single audit of DCPS (Audit Control Number 03-04-68025), were determined by the Assistant Secretaries to have been expended, during fiscal year 2003, in violation of Title I, Reading First, ITQ, and IDEA-B. Specifically, the Assistant Secretaries found that DCPS had: Failed to maintain appropriate documentation supporting payroll costs for Title I, ITQ, and IDEA-B; failed to provide proof of payment for various accrued expenses billed to Title I, ITQ, and IDEA-B; failed to maintain appropriate documentation for expenditures under ITQ and IDEA-B; failed to maintain source documentation to support journal entries for costs attributed to Title I, ITQ, and IDEA-B; failed to maintain adequate documentation to support the acquisition and disposition of property obtained with Reading First and Title I funds; and lacked adequate supporting documentation for items charged to IDEA-B.

                    DCPS filed an                     *Application for Review*                     of this PDL with the Office of Administrative Law Judges (OALJ) on September 10, 2007. On October 24, 2007, the OALJ granted the parties'                     *Joint Motion to Conduct Voluntary Discovery, Engage in Settlement Negotiations, and Suspend the Procedural Schedule (Joint Motion).*                     Since this                     *Joint Motion*                     was granted, DCPS [1]                                          has presented the Department with extensive documentation, not available to the Department at the time the PDL was issued, to support the withdrawal from this claim of $571,978 in questioned costs. In particular, DCPS provided copies of purchase orders, printouts from DCPS' accounting system with transaction detail, and copies of corresponding checks to support $556,033 in accrued expenses billed to Title I, ITQ, and IDEA-B. In addition, DCPS provided printouts from its accounting system with transaction detail and copies of corresponding checks demonstrating that expenditures under ITQ and IDEA-B totaling $15,945 were, in fact, made. After conducting a thorough review of this documentation, the Assistant Secretaries have decided to accept DCPS' documentation, thereby reducing the claim to $782,701.                

                    The Department proposes to compromise this remaining claim to $675,000. Based on litigation risks, the high percentage of funds being recovered (86 percent of the remaining claim), and the costs of proceeding through the administrative and, possibly, court process for this appeal, the Department has determined that it would not be practical or in the public interest to continue this proceeding. In making this determination, the Department recognizes that DCPS has entered into a High Risk Corrective Action Plan (HRCAP) with the Department, which includes a plan to address weaknesses in financial management, procurement, and property management, among other issues. Since entering into the HRCAP, the Department has worked closely with DCPS to support DCPS in resolving the issues addressed in the HRCAP, including the practices or procedures that gave rise to the disallowances in the PDL. Therefore, the Department does                           ( print page 17844)                        not anticipate recurrence of violations that gave rise to this PDL. As a result, under the authority in 20 U.S.C. 1234a(j), the Department has determined that compromise of this claim to $675,000 is appropriate. The public is invited to comment on the Department's intent to compromise this claim. Additional information may be obtained by contacting the person listed under                     **FOR FURTHER INFORMATION CONTACT**                    .                

*Electronic Access to This Document:*                     You can view this document, as well as all other documents of this Department published in the                     **Federal Register**                    , in text or Adobe Portable Document Format (PDF) on the Internet at the following site:                     *http://www.ed.gov/​news/​fedregister.*                     To use PDF you must have Adobe Acrobat Reader, which is available free at this site.                

# Note:

                         The official version of this document is the document published in the                         **Federal Register**                        . Free Internet access to the official edition of the                         **Federal Register**                         and the Code of Federal Regulations is available on GPO Access at:                         *http://www.gpoaccess.gov/​nara/​index.html.*

Program Authority:20 U.S.C. 1234a(j).

*Delegation of Authority:*                     The Secretary of Education has delegated authority to Thomas Skelly, Director, Budget Service, to perform the functions and duties of the Chief Financial Officer of the Department of Education.                

Dated: March 28, 2011.

Thomas Skelly,

Director, Budget Service.

# Footnotes

1.                             Since DCPS filed its application for review, the Office of the State Superintendent of Education (OSSE) was established as the District of Columbia's State educational agency (SEA). Although OSSE has been involved in settlement discussions and would necessarily have a role in any compromise, for ease of reference and consistent with the pleadings before the OALJ, this notice refers to DCPS as the relevant party.                    
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[FR Doc. 2011-7638 Filed 3-30-11; 8:45 am]

BILLING CODE 4000-01-P