Federal Register / Vol. 70, No. 165 / Friday, August 26, 2005 / Proposed Rules 50257

promulgated by a specific State, not by 

OSM. Under sections 503 and 505 of 

SMCRA (30 U.S.C. 1253 and 1255) and 

the Federal regulations at 30 CFR 

730.11, 732.15, and 732.17(h)(10), 

decisions on proposed State regulatory 

programs and program amendments 

submitted by the States must be based 

solely on a determination of whether the 

submittal is consistent with SMCRA and 

its implementing Federal regulations 

and whether the other requirements of 

30 CFR parts 730, 731, and 732 have 

been met. 

Executive Order 13132—Federalism 

This rule does not have federalism 

implications. SMCRA delineates the 

roles of the Federal and State 

Governments with regard to the 

regulation of surface coal mining and 

reclamation operations. One of the 

purposes of SMCRA is to ‘‘establish a 

nationwide program to protect society 

and the environment from the adverse 

effects of surface coal mining 

operations.’’ Section 503(a)(1) of 

SMCRA requires that State laws 

regulating surface coal mining and 

reclamation operations be ‘‘in 

accordance with’’ the requirements of 

SMCRA, and section 503(a)(7) requires 

that State programs contain rules and 

regulations ‘‘consistent with’’

regulations issued by the Secretary 

pursuant to SMCRA.

Executive Order 13175—Consultation 

and Coordination With Indian Tribal 

Governments 

In accordance with Executive Order 

13175, we have evaluated the potential 

effects of this rule on Federallyrecognized Indian tribes and have 

determined that the rule does not have 

substantial direct effects on one or more 

Indian tribes, on the relationship 

between the Federal Government and 

Indian tribes, or on the distribution of 

power and responsibilities between the 

Federal Government and Indian tribes. 

The basis for this determination is that 

our decision is on a State regulatory 

program and does not involve a Federal 

regulation involving Indian lands. 

Executive Order 13211—Regulations 

That Significantly Affect the Supply, 

Distribution, or Use of Energy 

On May 18, 2001, the President issued 

Executive Order 13211 which requires 

agencies to prepare a Statement of 

Energy Effects for a rule that is (1) 

considered significant under Executive 

Order 12866, and (2) likely to have a 

significant adverse effect on the supply, 

distribution, or use of energy. Because 

this rule is exempt from review under 

Executive Order 12866 and is not 

expected to have a significant adverse 

effect on the supply, distribution, or use 

of energy, a Statement of Energy Effects 

is not required. 

National Environmental Policy Act 

This rule does not require an 

environmental impact statement 

because section 702(d) of SMCRA (30 

U.S.C. 1292(d)) provides that agency 

decisions on proposed State regulatory 

program provisions do not constitute 

major Federal actions within the 

meaning of section 102(2)(C) of the 

National Environmental Policy Act (42 

U.S.C. 4332(2)(C)). 

Paperwork Reduction Act 

This rule does not contain 

information collection requirements that 

require approval by OMB under the 

Paperwork Reduction Act (44 U.S.C. 

3507 et seq.). 

Regulatory Flexibility Act 

The Department of the Interior 

certifies that this rule will not have a 

significant economic impact on a 

substantial number of small entities 

under the Regulatory Flexibility Act (5 

U.S.C. 601 et seq.). The State submittal, 

which is the subject of this rule, is based 

upon counterpart Federal regulations for 

which an economic analysis was 

prepared and certification made that 

such regulations would not have a 

significant economic effect upon a 

substantial number of small entities. In 

making the determination as to whether 

this rule would have a significant 

economic impact, the Department relied 

upon the data and assumptions for the 

counterpart Federal regulations. 

Small Business Regulatory Enforcement 

Fairness Act 

This rule is not a major rule under 5 

U.S.C. 804(2), the Small Business 

Regulatory Enforcement Fairness Act. 

This rule: (a) Does not have an annual 

effect on the economy of $100 million; 

(b) Will not cause a major increase in 

costs or prices for consumers, 

individual industries, Federal, State, or 

local government agencies, or 

geographic regions; and (c) Does not 

have significant adverse effects on 

competition, employment, investment, 

productivity, innovation, or the ability 

of U.S.-based enterprises to compete 

with foreign-based enterprises. This 

determination is based upon the 

analysis performed under various laws 

and executive orders for the counterpart 

Federal regulations. 

Unfunded Mandates 

This rule will not impose an 

unfunded mandate on State, local, or 

tribal governments or the private sector 

of $100 million or more in any given 

year. This determination is based upon 

the analysis performed under various 

laws and executive orders for the 

counterpart Federal regulations.

List of Subjects in 30 CFR Part 948 

Intergovernmental relations, Surface 

mining, Underground mining.

Dated: July 29, 2005 

Brent Wahlquist, 

Regional Director, Appalachian Region.

[FR Doc. 05–17002 Filed 8–25–05; 8:45 am] 

BILLING CODE 4310–05–P

DEPARTMENT OF EDUCATION

34 CFR Part 226 

State Charter School Facilities 

Incentive Program

AGENCY: Office of Innovation and 

Improvement, Department of Education.

ACTION: Notice of proposed rulemaking.

SUMMARY: The Secretary issues these 

proposed regulations to administer the 

State Charter School Facilities Incentive 

program. Under this program, the 

Department of Education 

(‘‘Department’’) provides competitive 

grants to States to help charter schools 

meet their need for facilities.

DATES: We must receive your comments 

on or before September 26, 2005.

ADDRESSES: Address all comments about 

these proposed regulations to Jim 

Houser, U.S. Department of Education, 

400 Maryland Avenue, SW., room 

4W245, Washington, DC 20202–6140. If 

you prefer to send your comments 

through the Internet, you may address 

them to us at the U.S. Government Web 

site: http://www.regulations.gov; or you 

may send your Internet comments to us 

at the following address: 

comments@ed.gov.

You must include the term ‘‘state 

incentive’’ in the subject line of your 

electronic message. 

If you want to comment on the 

information collection requirements, 

you must send your comments to the 

Office of Management and Budget 

(OMB) at the address listed in the 

Paperwork Reduction Act section of this 

preamble. You may also send a copy of 

these comments to the Department 

representative named in this section.

FOR FURTHER INFORMATION CONTACT: Ann 

Margaret Galiatsos or Jim Houser, U.S. 

Department of Education, 400 Maryland 

Avenue, SW., Washington, DC 20202–

6140. Telephone: (202) 205–9765 or via 

Internet: charter.facilities@ed.gov.

50258 Federal Register / Vol. 70, No. 165 / Friday, August 26, 2005 / Proposed Rules 

If you use a telecommunications 

device for the deaf (TDD), you may call 

the Federal Relay Service (FRS) at 1–

800–877–8339. 

Individuals with disabilities may 

obtain this document in an alternative 

format (e.g., Braille, large print, 

audiotape, 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 these proposed regulations. 

To ensure that your comments have 

maximum effect in developing the final 

regulations, we urge you to identify 

clearly the specific section or sections of 

the proposed regulations that each of 

your comments addresses and to arrange 

your comments in the same order as the 

proposed regulations. 

We also invite you to assist us in 

complying with the specific 

requirements of Executive Order 12866 

and its overall requirement of reducing 

regulatory burden that might result from 

these proposed regulations. Please let us 

know of any further opportunities we 

should take to 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 these proposed regulations in 

room 4W259, 400 Maryland Avenue, 

SW., Washington, DC, between the 

hours of 8:30 a.m. and 4 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 supply an 

appropriate aid, such as a reader or 

print magnifier, to an individual with a 

disability who needs assistance to 

review the comments or other 

documents in the public rulemaking 

record for these proposed regulations. If 

you want to schedule an appointment 

for this type of aid, please contact the 

person listed under FOR FURTHER

INFORMATION CONTACT.

Background 

These proposed regulations would 

apply to the State Charter School 

Facilities Incentive program, which is 

authorized under title V, part B, subpart 

1 of the Elementary and Secondary 

Education Act of 1965, as amended by 

the No Child Left Behind Act of 2001 

(Pub. L. 107–110, enacted January 8, 

2002) (Act). The purpose of this 

program is to assist charter schools in 

meeting their facilities needs. Under 

this program, funds are provided on a 

competitive basis to States to create new 

or enhance existing per-pupil facilities 

aid programs on behalf of charter 

schools. 

In this notice, we are proposing to 

establish selection criteria and funding 

priorities for this program’s 

discretionary grant competitions after 

fiscal year (FY) 2004. The proposed 

criteria are designed to award grants to 

States that are assisting charter schools 

with meeting their facility needs, but 

still have an unmet need. The proposed 

criteria also would be used to assess the 

quality of the applicant’s plan, the 

proposed grant project team, and the 

proposed budget. These criteria would 

appear in § 226.12 and are similar to the 

criteria that the Department used to 

award grants under this program in FY 

2004. 

Section 226.14 of the proposed 

regulations would include two 

competitive preference priorities. The 

proposed priority in § 226.14(a) is 

designed to meet the need for facilities 

in areas with the greatest need for 

public school choice. In some cases, 

there are an insufficient number of 

classroom seats to provide public school 

choice. Under the proposed priority in 

§ 226.14(b), we would award additional 

points to States that have not previously 

received a grant under the program. 

Section 226.21 of the proposed 

regulations would clarify that 

construction and the purchase of real 

property are allowable expenditures 

under this program. Under 34 CFR 

75.533, these expenditures are 

prohibited unless either the program 

statute or the implementing regulations 

explicitly authorize them. Because 

expenditures for construction and the 

purchase of real property are critical to 

implementing successful school facility 

programs, we are proposing that they be 

authorized in the implementing 

regulations. Proposed § 226.21 also lists 

other allowable uses of grant funds 

under this program. 

Proposed § 226.22 indicates the types 

of expenditures that would fall under 

the five percent cap on administrative 

expenses. This proposed regulation is 

based on a statutory cap of five percent 

that applies to evaluation, technical 

assistance, and dissemination. Proposed 

§ 226.22 is designed to maximize the 

amount of funds available for charter 

schools while still providing States with 

sufficient funds to adequately 

administer the program. 

Executive Order 12866 

1. Potential Costs and Benefits 

Under Executive Order 12866, we 

have assessed the potential costs and 

benefits of this regulatory action. 

The potential costs associated with 

the proposed regulations are those 

resulting from statutory requirements 

and those we have determined to be 

necessary for administering this 

program effectively and efficiently. 

Elsewhere in this SUPPLEMENTARY

INFORMATION section we identify and 

explain burdens specifically associated 

with information collection 

requirements. See the heading 

Paperwork Reduction Act of 1995.

In assessing the potential costs and 

benefits—both quantitative and 

qualitative—of this regulatory action, 

we have determined that the benefits 

would justify the costs. 

We have also determined that this 

regulatory action would not unduly 

interfere with State, local, and tribal 

governments in the exercise of their 

governmental functions. 

Summary of Potential Costs and 

Benefits 

The Secretary believes that these 

regulations are necessary to clarify 

complex statutory provisions. As noted 

elsewhere in this notice, these proposed 

regulations add clarity where the statute 

is ambiguous or reorganize statutory 

material to facilitate a better 

understanding of the statute’s 

requirements. Nearly all of the benefits 

and costs of these proposed regulations 

stem from the underlying statute and 

not the regulations. The costs associated 

with these proposed regulations are not 

only minimal but are also justified in 

terms of the benefits that applicants for 

these discretionary grants will receive. 

The statute requires an application, but 

the types of information that would be 

collected through the proposed 

selection criteria should be readily 

available to applicants under this 

program and would impose minimal 

burden on applicants. 

2. Clarity of the Regulations 

Executive Order 12866 and the 

Presidential memorandum on ‘‘Plain 

Language in Government Writing’’

require each agency to write regulations 

that are easy to understand. 

The Secretary invites comments on 

how to make these proposed regulations 

easier to understand, including answers 

to questions such as the following: 

• Are the requirements in the 

proposed regulations clearly stated? 

Federal Register / Vol. 70, No. 165 / Friday, August 26, 2005 / Proposed Rules 50259

• Do the proposed regulations contain 

technical terms or other wording that 

interferes with their clarity? 

• Does the format of the proposed 

regulations (grouping and order of 

sections, use of headings, paragraphing, 

etc.) aid or reduce their clarity? 

• Would the proposed regulations be 

easier to understand if we divided them 

into more (but shorter) sections? (A 

‘‘section’’ is preceded by the symbol 

‘‘§ ’’ and a numbered heading; for 

example, § 226.1 What is the State 

Charter School Facilities Incentive 

program?) 

• Could the description of the 

proposed regulations in the 

‘‘Supplementary Information’’ section of 

this preamble be more helpful in 

making the proposed regulations easier 

to understand? If so, how? 

• What else could we do to make the 

proposed regulations easier to 

understand? 

Send any comments that concern how 

the Department could make these 

proposed regulations easier to 

understand to the person listed in the 

ADDRESSES section of the preamble. 

Regulatory Flexibility Act Certification 

The Secretary certifies that these 

proposed regulations would not have a 

significant economic impact on a 

substantial number of small entities. 

The small entities that would be 

tangentially affected by these proposed 

regulations are small grantees and, 

tangentially, small charter schools that 

ultimately benefit from services 

provided by grantees. In addition, we do 

not believe that the regulations would 

have a significant economic impact on 

the limited number of small charter 

schools affected because the proposed 

regulations would not impose excessive 

regulatory burdens on those entities or 

require unnecessary Federal 

supervision. 

The proposed regulations would 

benefit both small and large entities in 

that they clarify confusing and complex 

statutory requirements. Also, because 

the statute requires State Charter School 

Facilities Incentive applicants to apply 

to the Department if they wish to 

receive discretionary funds, it would be 

difficult for the Department to award 

funds without the application 

information specified in the proposed 

regulations. The proposed regulations 

will ensure that applicants do not 

provide a significant amount of 

information that is already available to 

the Department. 

The proposed regulations would 

impose minimal requirements for all 

applicants and minimal requirements 

with which grant recipients must 

comply. However, the Secretary 

specifically invites comments on the 

effects of the proposed regulations on 

small entities, and on whether there 

may be further opportunities to reduce 

any potential adverse impact or increase 

potential benefits resulting from these 

proposed regulations without impeding 

the effective and efficient 

administration of the State Charter 

School Facilities Incentive program. 

Paperwork Reduction Act of 1995 

Sections 226.12, 226.13, and 226.14 of 

these proposed regulations contain 

information collection requirements. 

Under the Paperwork Reduction Act of 

1995 (44 U.S.C. 3507(d)), the 

Department has submitted a copy of 

these sections to OMB for its review. 

Collection of Information: State 

Charter School Facilities Incentive 

Grant program.

The Department will use the 

information collected through the 

selection criteria and competitive 

preference priorities to determine 

whether to fund applicants. Since the 

statute requires applicants to apply for 

funds, the Department would not be 

able to award these funds without the 

application to collect the required 

information. 

We estimate the annual reporting and 

recordkeeping burden for this collection 

of information to average 40 hours for 

each respondent for 10 applicants, 

including the time for reviewing 

instructions, searching existing data 

sources, gathering and maintaining the 

data needed, and completing and 

reviewing the collection of information. 

Thus, we estimate the total annual 

reporting and recordkeeping burden for 

this collection to be 400 hours. 

If you want to comment on the 

information collection requirements, 

please send your comments to the Office 

of Information and Regulatory Affairs, 

OMB, room 10235, New Executive 

Office Building, Washington, DC 20503; 

Attention: Desk Officer for U.S. 

Department of Education. You may also 

send a copy of these comments to the 

Department representative named in the 

ADDRESSES section of this preamble. 

We consider your comments on this 

proposed collection of information in—

• Deciding whether the proposed 

collection is necessary for the proper 

performance of our functions, including 

whether the information will have 

practical use; 

• Evaluating the accuracy of our 

estimate of the burden of the proposed 

collection, including the validity of our 

methodology and assumptions; 

• Enhancing the quality, usefulness, 

and clarity of the information we 

collect; and 

• Minimizing the burden on those 

who must respond. This includes 

exploring the use of appropriate 

automated, electronic, mechanical, or 

other technological collection 

techniques or other forms of information 

technology (e.g., permitting electronic 

submission of responses). 

OMB is required to make a decision 

concerning the collection of information 

contained in these proposed regulations 

between 30 and 60 days after 

publication of this document in the 

Federal Register. Therefore, to ensure 

that OMB gives your comments full 

consideration, it is important that OMB 

receives the comments within 30 days 

of publication. This does not affect the 

deadline for your comments to us on the 

proposed regulations. 

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. 

Electronic Access to This Document 

You may view this document, as well 

as all other Department of Education 

documents published in the Federal 

Register, in text or Adobe Portable 

Document Format (PDF) on the Internet 

at the following site: www.ed.gov/news/

fedregister.

To use PDF you must have Adobe 

Acrobat Reader, which is available free 

at this site. If you have questions about 

using PDF, call the U.S. Government 

Printing Office (GPO), toll free, at 1–

888–293–6498; or in the Washington, 

DC, area at (202) 512–1530. 

You may also view this document in 

PDF at the following site: http://

www.ed.gov/programs/charterfacilities/

index.html.

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.

(Catalog of Federal Domestic Assistance 

Number 84.354A State Charter School 

Facilities Incentive program.)

50260 Federal Register / Vol. 70, No. 165 / Friday, August 26, 2005 / Proposed Rules 

The Secretary of Education has 

delegated authority to the Assistant 

Deputy Secretary for Innovation and 

Improvement to issue these proposed 

amendments to 34 CFR Chapter II.

List of Subjects in 34 CFR Part 226 

Charter Schools, Education, 

Educational facilities, Elementary and 

secondary education, Grant programs—

education, Report and recordkeeping 

requirements, Schools.

Dated: August 23, 2005. 

Nina Shokraii Rees, 

Assistant Deputy Secretary for Innovation and 

Improvement.

For the reasons discussed in the 

preamble, the Secretary proposes to 

amend title 34 of the Code of Federal 

Regulations by adding a new part 226 to 

read as follows:

PART 226—STATE CHARTER SCHOOL 

FACILITIES INCENTIVE PROGRAM

Subpart A—General 

Sec. 

226.1 What is the State Charter School 

Facilities Incentive program? 

226.2 Who is eligible to receive a grant? 

226.3 What regulations apply to the State 

Charter School Facilities Incentive 

program? 

226.4 What definitions apply to the State 

Charter School Facilities Incentive 

program?

Subpart B—How Does the Secretary Award 

a Grant? 

226.11 How does the Secretary evaluate an 

application? 

226.12 What selection criteria does the 

Secretary use in evaluating an 

application for a State Charter School 

Facilities Incentive program grant? 

226.13 What statutory funding priority does 

the Secretary use in making a grant 

award? 

226.14 What other funding priorities may 

the Secretary use in making a grant 

award?

Subpart C—What Conditions Must Be Met 

by a Grantee? 

226.21 How may charter schools use these 

funds? 

226.22 May grantees use grant funds for 

administrative costs? 

226.23 May charter schools use grant funds 

for administrative costs?

Authority: 20 U.S.C. 1221e–3; 7221d(b), 

unless otherwise noted.

Subpart A—General

§ 226.1 What is the State Charter School 

Facilities Incentive program? 

(a) The State Charter School Facilities 

Incentive program provides grants to 

States to help charter schools pay for 

facilities. 

(b) Grantees must use these grants 

to—

(1) Establish new per-pupil facilities 

aid programs for charter schools; 

(2) Enhance existing per-pupil 

facilities aid programs for charter 

schools; or 

(3) Administer programs described 

under paragraphs (b)(1) and (2) of this 

section. 

(Authority: 20 U.S.C. 7221d(b))

§ 226.2 Who is eligible to receive a grant? 

States are eligible to receive grants 

under this program. 

(Authority: 20 U.S.C. 7221(b))

§ 226.3 What regulations apply to the State 

Charter School Facilities Incentive 

program? 

The following regulations apply to the 

State Charter School Facilities Incentive 

program: 

(a) The Education Department General 

Administrative Regulations (EDGAR) as 

follows: 

(1) 34 CFR part 74 (Administration of 

Grants and Agreements with Institutions 

of Higher Education, Hospitals, and 

other Non-Profit Organizations). 

(2) 34 CFR part 75 (Direct Grant 

Programs). 

(3) 34 CFR part 77 (Definitions that 

Apply to Department Regulations). 

(4) 34 CFR part 79 (Intergovernmental 

Review of Department of Education 

Programs and Activities). 

(5) 34 CFR part 80 (Uniform 

Administrative Requirements for Grants 

and Cooperative Agreements to State 

and Local Governments). 

(6) 34 CFR part 81 (General Education 

Provisions Act—Enforcement). 

(7) 34 CFR part 82 (New Restrictions 

on Lobbying). 

(8) 34 CFR part 84 (Governmentwide 

Requirements for Drug-Free Workplace 

(Financial Assistance)). 

(9) 34 CFR part 85 (Governmentwide 

Debarment and Suspension 

(Nonprocurement)). 

(10) 34 CFR part 97 (Protection of 

Human Subjects). 

(11) 34 CFR part 98 (Student Rights in 

Research, Experimental Programs, and 

Testing). 

(12) 34 CFR part 99 (Family 

Educational Rights and Privacy). 

(b) The regulations in this part 226. 

(Authority: 20 U.S.C. 1221e–3; 7221d(b))

§ 226.4 What definitions apply to the State 

Charter School Facilities Incentive 

program? 

(a) Definitions in the statute. The 

following term used in this part is 

defined in section 5210 of the 

Elementary and Secondary Education 

Act of 1965, as amended (ESEA): 

Charter school 

(b) Definitions in EDGAR. The 

following terms used in this part are 

defined in 34 CFR 77.1:

Applicant 

Application 

Award 

Department 

EDGAR 

Facilities 

Grant 

Grantee 

Project 

Public 

Secretary

(c) Other definition. The following 

definition also applies to this part: 

Construction means—

(1) Preparing drawings and 

specifications for school facilities 

projects; 

(2) Repairing, renovating, or altering 

school facilities; 

(3) Extending school facilities as 

described in 34 CFR 222.172(b); 

(4) Erecting or building school 

facilities; and 

(5) Inspections or supervision related 

to school facilities. 

(Authority: 20 U.S.C. 7221d(b); 7221i(1))

Subpart B—How Does the Secretary 

Award a Grant?

§ 226.11 How does the Secretary evaluate 

an application? 

(a) The Secretary evaluates an 

application on the basis of the criteria 

in § 226.12 and the competitive 

preference priorities in § 226.13 and 

§ 226.14. 

(b) The Secretary informs applicants 

of the maximum possible score for each 

criterion and competitive preference 

priority in the application package or in 

a notice published in the Federal 

Register. 

(Authority: 20 U.S.C. 7221d(b))

§ 226.12 What selection criteria does the 

Secretary use in evaluating an application 

for a State Charter School Facilities 

Incentive program grant? 

The selection criteria for this program 

are as follows: 

(a) Need for facility funding. (1) The 

need for per-pupil charter school facility 

funding in the State. 

(2) The extent to which the proposal 

meets the need to fund charter school 

facilities on a per-pupil basis. 

(b) Quality of plan. (1) The likelihood 

that the proposed grant project will 

result in the State either retaining a new 

per-pupil facilities aid program or 

continuing to enhance such a program 

without the total amount of assistance 

Federal Register / Vol. 70, No. 165 / Friday, August 26, 2005 / Proposed Rules 50261

(State and Federal) declining over a fiveyear period. 

(2) The flexibility charter schools 

have in their use of facility funds for the 

various authorized purposes. 

(3) The quality of the plan for 

identifying charter schools and 

determining their eligibility to receive 

funds. 

(4) The per-pupil facilities aid 

formula’s ability to target resources to 

charter schools with the greatest need 

and the highest proportions of students 

in poverty. 

(5) For projects that plan to reserve 

funds for evaluation, the quality of the 

applicant’s plan to use grant funds for 

this purpose. 

(6) For projects that plan to reserve 

funds for technical assistance, 

dissemination, or personnel, the quality 

of the applicant’s plan to use grant 

funds for these purposes. 

(c) The grant project team. (1) The 

qualifications, including relevant 

training and experience, of the project 

manager and other members of the grant 

project team, including employees not 

paid with grant funds, consultants, and 

subcontractors. 

(2) The adequacy and appropriateness 

of the applicant’s staffing plan for the 

grant project. 

(d) The budget. (1) The extent to 

which the requested grant amount and 

the project costs are reasonable in 

relation to the objectives, design, and 

potential significance of the proposed 

grant project. 

(2) The extent to which the costs are 

reasonable in relation to the number of 

students served and to the anticipated 

results and benefits. 

(3) The extent to which the nonFederal share exceeds the minimum 

percentages (which are based on the 

percentages under section 5205(b)(2)(C) 

of the ESEA), particularly in the initial 

years of the program. 

(e) State experience. The experience 

of the State in addressing the facility 

needs of charter schools through various 

means, including providing per-pupil 

aid, access to State loan or bonding 

pools, and the use of Qualified Zone 

Academy Bonds. 

(Authority: 20 U.S.C. 7221d(b))

§ 226.13 What statutory funding priority 

does the Secretary use in making a grant 

award? 

The Secretary shall award additional 

points under a competitive preference 

priority regarding: 

(a) Periodic Review and Evaluation.

The State provides for periodic review 

and evaluation by the authorized public 

chartering agency of each charter school 

at least once every five years unless 

required more frequently by State law, 

to determine whether the charter school 

is meeting the terms of the school’s 

charter and is meeting or exceeding the 

student academic performance 

requirements and goals for charter 

schools as set forth under State law or 

the school’s charter. 

(b) Number of High-Quality Charter 

Schools. The State has demonstrated 

progress in increasing the number of 

high-quality charter schools that are 

held accountable in the terms of the 

schools’ charters for meeting clear and 

measurable objectives for the 

educational progress of the students 

attending the schools, in the period 

prior to the period for which the State 

applies for a grant under this 

competition.

(c) One Authorized Public Chartering 

Agency Other than an LEA, or an 

Appeals Process. The State—

(1) Provides for one authorized public 

chartering agency that is not a local 

educational agency (LEA), such as a 

State chartering board, for each 

individual or entity seeking to operate a 

charter school pursuant to State law; or 

(2) In the case of a State in which 

LEAs are the only authorized public 

chartering agencies, allows for an 

appeals process for the denial of an 

application for a charter school. 

(d) High Degree of Autonomy. The 

State ensures that each charter school 

has a high degree of autonomy over the 

charter school’s budgets and 

expenditures. 

(Authority: 20 U.S.C. 7221b; 7221d(b))

§ 226.14 What other funding priorities may 

the Secretary use in making a grant award? 

(a) The Secretary may award points to 

an application under a competitive 

preference priority regarding the 

capacity of charter schools to offer 

public school choice in those 

communities with the greatest need for 

this choice based on—

(1) The extent to which the applicant 

would target services to geographic 

areas in which a large proportion or 

number of public schools have been 

identified for improvement, corrective 

action, or restructuring under title I of 

the ESEA; 

(2) The extent to which the applicant 

would target services to geographic 

areas in which a large proportion of 

students perform poorly on State 

academic assessments; and 

(3) The extent to which the applicant 

would target services to communities 

with large proportions of low-income 

students. 

(b) The Secretary may award points to 

an application under a competitive 

preference priority for applicants that 

have not previously received a grant 

under the program. 

(c) The Secretary may elect to 

consider the points awarded under 

these priorities only for proposals that 

exhibit sufficient quality to warrant 

funding under the selection criteria in 

§ 226.12 of this part. 

(Authority: 20 U.S.C. 7221d(b))

Subpart C—What Conditions Must Be 

Met by a Grantee?

§ 226.21 How may charter schools use 

these funds? 

(a) Charter schools that receive grant 

funds through their State must use the 

funds for facilities. Except as provided 

in paragraph (b) of this section, 

allowable expenditures include: 

(1) Rent. 

(2) Purchase of building or land. 

(3) Construction. 

(4) Renovation of an existing school 

facility. 

(5) Leasehold improvements. 

(6) Debt service on a school facility. 

(b) Charter schools may not use these 

grant funds for purchasing land when 

they have no immediate plans to 

construct a building on that land. 

(Authority: 20 U.S.C. 7221d(b))

§ 226.22 May grantees use grant funds for 

administrative costs? 

State grantees may use up to five 

percent of their grant award for 

administrative expenses that include: 

indirect costs, evaluation, technical 

assistance, dissemination, personnel 

costs, and any other costs involved in 

administering the State’s per-pupil 

facilities aid program. 

(Authority: 20 U.S.C. 7221d(b))

§ 226.23 May charter schools use grant 

funds for administrative costs? 

(a) Except as provided in paragraph 

(b) of this section, charter school 

subgrantees may use grant funds for 

administrative costs that are necessary 

and reasonable for the proper and 

efficient performance and 

administration of this Federal grant. 

This use of funds, as well as indirect 

costs and rates, must comply with 

EDGAR and the Office of Management 

and Budget Circular A–87 (Cost 

Principles for State, Local, and Indian 

Tribal Governments). 

(b) Consistent with the requirements 

in 34 CFR 75.564(c)(2), any charter 

school subgrantees that use grant funds 

for construction activities may not be 

reimbursed for indirect costs for those 

activities. 

(Authority: 20 U.S.C. 1221e-3; 7221d(b))

[FR Doc. 05–17049 Filed 8–25–05; 8:45 am] 

BILLING CODE 4000–01–P