512
HR 1 PCS
tests, Native student dropout rates are high, and
Natives are significantly underrepresented among
holders of baccalaureate degrees in the State of
Alaska. As a result, Native students are being de-
nied their opportunity to become full participants in
society by grade school and high school educations
that are condemning an entire generation to an
underclass status and a life of limited choices.
‘‘(5) The programs authorized herein, combined
with expanded Head Start, infant learning and early
childhood education programs, and parent education
programs are essential if educational handicaps are
to be overcome.
‘‘(6) The sheer magnitude of the geographic
barriers to be overcome in delivering educational
services in rural and village Alaska should be ad-
dressed through the development and implementa-
tion of innovative, model programs in a variety of
areas.
‘‘(7) Congress finds that Native children should
be afforded the opportunity to begin their formal
education on a par with their non-Native peers. The
Federal Government should lend support to efforts
developed by and undertaken within the Alaska Na-
513
HR 1 PCS
tive community to improve educational opportunity
for all students.
‘‘SEC. 3303. PURPOSE.
‘‘It is the purpose of this subpart to—
‘‘(1) recognize the unique educational needs of
Alaska Natives;
‘‘(2) authorize the development of supplemental
educational programs to benefit Alaska Natives;
‘‘(3) supplement existing programs and authori-
ties in the area of education to further the purposes
of this subpart; and
‘‘(4) provide direction and guidance to appro-
priate Federal, State and local agencies to focus re-
sources, including resources made available under
this subpart, on meeting the educational needs of
Alaska Natives.
‘‘SEC. 3304. PROGRAM AUTHORIZED.
‘‘(a) GENERAL AUTHORITY.—
‘‘(1) PROGRAM AUTHORIZED.—The Secretary is
authorized to make grants to, or enter into contracts
with, Alaska Native organizations, educational enti-
ties with experience in developing or operating Alas-
ka Native programs or programs of instruction con-
ducted in Alaska Native languages, and consortia of
514
HR 1 PCS
such organizations and entities to carry out pro-
grams that meet the purpose of this subpart.
‘‘(2) 
PERMISSIBLE
ACTIVITIES.—Programs
under this subpart may include—
‘‘(A) the development and implementation
of plans, methods, and strategies to improve the
education of Alaska Natives;
‘‘(B) the development of curricula and edu-
cational programs that address the educational
needs of Alaska Native students, including—
‘‘(i) curriculum materials that reflect
the cultural diversity or the contributions
of Alaska Natives;
‘‘(ii) instructional programs that make
use of Native Alaskan languages; and
‘‘(iii) networks that introduce success-
ful programs, materials, and techniques to
urban and rural schools;
‘‘(C) professional development activities for
educators, including—
‘‘(i) programs to prepare teachers to
address the cultural diversity and unique
needs of Alaska Native students;
515
HR 1 PCS
‘‘(ii) in-service programs to improve
the ability of teachers to meet the unique
needs of Alaska Native students; and
‘‘(iii) recruiting and preparing teach-
ers who are Alaska Natives, reside in com-
munities with high concentrations of Alas-
ka Native students, or are likely to succeed
as teachers in isolated, rural communities
and engage in cross-cultural instruction;
‘‘(D) the development and operation of
home instruction programs for Alaska Native
preschool children, the purpose of which is to
ensure the active involvement of parents in
their children’s education from the earliest
ages;
‘‘(E) family literacy services;
‘‘(F) the development and operation of stu-
dent enrichment programs in science and math-
ematics that—
‘‘(i) are designed to prepare Alaska
Native students from rural areas, who are
preparing to enter high school, to excel in
science and math; and
‘‘(ii) provide appropriate support serv-
ices to the families of such students that
516
HR 1 PCS
are needed to enable such students to ben-
efit from the program;
‘‘(G) research and data collection activities
to determine the educational status and needs
of Alaska Native children and adults;
‘‘(H) other research and evaluation activi-
ties related to programs under this subpart;
and
‘‘(I) other activities, consistent with the
purposes of this subpart, to meet the edu-
cational needs of Alaska Native children and
adults.
‘‘(3) HOME
INSTRUCTION
PROGRAMS.—Home
instruction programs for Alaska Native preschool
children under paragraph (2)(D) may include—
‘‘(A) programs for parents and their in-
fants, from prenatal through age three;
‘‘(B) preschool programs; and
‘‘(C) training, education, and support for
parents in such areas as reading readiness, ob-
servation, story-telling, and critical thinking.
‘‘(b) LIMITATION ON ADMINISTRATIVE COSTS.—Not
more than 5 percent of funds provided to a grantee under
this section for any fiscal year may be used for administra-
tive purposes.
517
HR 1 PCS
‘‘(c) AUTHORIZATION OF APPROPRIATIONS.—There
are authorized to be appropriated $15,000,000 for fiscal
year 2002, and such sums as may be necessary for each
of the fiscal years 2003 through 2006 to carry out this
subpart.
‘‘SEC. 3305. ADMINISTRATIVE PROVISIONS.
‘‘(a) APPLICATION REQUIRED.—No grant may be
made under this subpart, nor any contract be entered into
under this subpart, unless an application is submitted to
the Secretary in such form, in such manner, and con-
taining such information as the Secretary may determine
necessary to carry out the provisions of this subpart.
‘‘(b) APPLICATIONS.—State and local educational
agencies may apply for an award under this subpart only
as subpart of a consortium involving an Alaska Native or-
ganization. This consortium may include other eligible ap-
plicants.
‘‘(c) CONSULTATION REQUIRED.—Each applicant for
funding shall provide for ongoing advice from and con-
sultation with representatives of the Alaska Native com-
munity.
‘‘(d) LOCAL
EDUCATIONAL
AGENCY
COORDINA-
TION.—Each applicant for an award under this subpart
shall inform each local educational agency serving stu-
518
HR 1 PCS
dents who would participate in the project about its appli-
cation.
‘‘SEC. 3306. DEFINITIONS.
‘‘For purposes of this subpart—
‘‘(1) the term ‘Alaska Native’ has the same
meaning as the term ‘Native’ has in section 3(b) of
the Alaska Native Claims Settlement Act; and
‘‘(2) the term ‘Alaska Native organization’
means a federally recognized tribe, consortium of
tribes, regional nonprofit Native association, and
other Alaska Native organizations that—
‘‘(A) has or commits to acquire expertise
in the education of Alaska Natives; and
‘‘(B) has Alaska Natives in substantive
and policy-making positions within the organi-
zation.’’.
(b) SAVINGS PROVISION.—Funds appropriated for
part C of title IX of the Elementary and Secondary Edu-
cation Act of 1965 (as in effect on the day before the date
of the enactment of this Act) shall be available for use
under subpart 2 of part B of title III of such Act, as added
by this section.
519
HR 1 PCS
SEC. 313. AMENDMENTS TO THE EDUCATION AMENDMENTS
OF 1978.
Part B of title XI of the Education Amendments of
1978 (25 U.S.C. 2001 et seq.) is amended to read as fol-
lows:
‘‘PART B—BUREAU OF INDIAN AFFAIRS
PROGRAMS
‘‘SEC. 1120. FINDING AND POLICY.
‘‘(a) FINDING.—Congress finds and recognizes that
the Federal Government has the sole responsibility for the
operation and financial support of the Bureau of Indian
Affairs funded school system that it has established on
or near Indian reservations and Indian trust lands
throughout the Nation for Indian children.
‘‘(b) POLICY.—It is the policy of the United States
to work in full cooperation with Indian tribes toward the
goal of assuring that the programs of the Bureau of In-
dian Affairs funded school system are of the highest qual-
ity and meet the unique educational and cultural needs
of Indian children.
‘‘SEC. 1121. ACCREDITATION AND STANDARDS FOR THE
BASIC EDUCATION OF INDIAN CHILDREN IN
BUREAU OF INDIAN AFFAIRS SCHOOLS.
‘‘(a) PURPOSE.—The purpose of the standards imple-
mented under this section shall be to afford Indian stu-
dents being served by a school funded by the Bureau of
520
HR 1 PCS
Indian Affairs the same opportunities as all other students
in the United States to achieve the same challenging State
academic achievement standards expected of all students.
‘‘(b) STUDIES AND SURVEYS RELATING TO STAND-
ARDS.—Not later than 1 year after the date of the enact-
ment of the No Child Left Behind Act of 2001, the Sec-
retary, in consultation with the Secretary of Education,
consortia of education organizations, and Indian organiza-
tions and tribes, and making the fullest use possible of
other existing studies, surveys, and plans, shall carry out
by contract with an Indian organization, studies and sur-
veys to establish and revise standards for the basic edu-
cation of Indian children attending Bureau funded
schools. Such studies and surveys shall take into account
factors such as academic needs, local cultural differences,
type and level of language skills, geographic isolation, and
appropriate teacher-student ratios for such children, and
shall be directed toward the attainment of equal edu-
cational opportunity for such children.
‘‘(c) REVISION
OF MINIMUM ACADEMIC STAND-
ARDS.—
‘‘(1) IN
GENERAL.—Not later than 2 years
after the date of the enactment of the No Child Left
Behind Act of 2001, the Secretary shall—
521
HR 1 PCS
‘‘(A) propose revisions to the minimum
academic standards published in the Federal
Register on September 9, 1995 (50 Fed. Reg.
174) for the basic education of Indian children
attending Bureau funded schools in accordance
with the purpose described in subsection (a)
and the findings of the studies and surveys con-
ducted under subsection (b);
‘‘(B) publish such proposed revisions to
such standards in the Federal Register for the
purpose of receiving comments from the tribes,
tribal school boards, Bureau funded schools,
and other interested parties; and
‘‘(C) consistent with the provisions of this
section and section 1131, take such actions as
are necessary to coordinate standards imple-
mented under this section with the Comprehen-
sive School Reform Plan developed by the Bu-
reau and—
‘‘(i) with the standards of the im-
provement plans for the States in which
any school operated by the Bureau of In-
dian Affairs is located; or
‘‘(ii) in the case where schools oper-
ated by the Bureau are within the bound-
522
HR 1 PCS
aries of reservation land of one tribe but
within the boundaries of more than one
State, with the standards of the State im-
provement plan of one such State selected
by the tribe.
‘‘(2) FURTHER REVISIONS.—Not later that 6
months after the close of the comment period, the
Secretary shall establish final standards, distribute
such standards to all tribes and publish such final
standards in the Federal Register. The Secretary
shall revise such standards periodically as necessary.
Prior to any revision of such final standards, the
Secretary shall distribute such proposed revision to
all the tribes, and publish such proposed revision in
the Federal Register, for the purpose of receiving
comments from the tribes and other interested par-
ties.
‘‘(3) APPLICABILITY
OF
STANDARDS.—Except
as provided in subsection (e), the final standards
published under paragraph (2) shall apply to all Bu-
reau funded schools not accredited under subsection
(f), and may also serve as a model for educational
programs for Indian children in public schools.
‘‘(4) CONSIDERATIONS
WHEN
ESTABLISHING
AND REVISING STANDARDS.—In establishing and re-
523
HR 1 PCS
vising such standards, the Secretary shall take into
account the unique needs of Indian students and
support and reinforcement of the specific cultural
heritage of each tribe.
‘‘(d) ALTERNATIVE OR MODIFIED STANDARDS.—The
Secretary shall provide alternative or modified standards
in lieu of the standards established under subsection (c),
where necessary, so that the programs of each school are
in compliance with the minimum accreditation standards
required for schools in the State or region where the school
is located.
‘‘(e) WAIVER OF STANDARDS; ALTERNATIVE STAND-
ARDS.—A tribal governing body, or the local school board
so designated by the tribal governing body, shall have the
local authority to waive, in part or in whole, the standards
established under subsections (c) and (d) if such standards
are deemed by such body to be inappropriate. The tribal
governing body or designated school board shall, not later
than 60 days after a waiver under this subsection, submit
to the Secretary a proposal for alternative standards that
take into account the specific needs of the tribe’s children.
Such alternative standards shall be established by the Sec-
retary unless specifically rejected by the Secretary for
good cause and in writing to the affected tribes or local
524
HR 1 PCS
school board, which rejection shall be final and not subject
to review.
‘‘(f) ACCREDITATION
AND
IMPLEMENTATION
OF
STANDARDS.—
‘‘(1) DEADLINE FOR MEETING STANDARDS.—
Not later the second academic year after publication
of the standards, to the extent necessary funding is
provided, all Bureau funded schools shall meet the
standards established under subsections (c) and (d)
or shall be accredited—
‘‘(A) by a tribal accrediting body, if the ac-
creditation standards of the tribal accrediting
body have been accepted by formal action of the
tribal governing body and are equal to or ex-
ceed the accreditation standards of the State or
region in which the school is located;
‘‘(B) by a regional accreditation agency; or
‘‘(C) by State accreditation standards for
the State in which it is located.
‘‘(2) DETERMINATION OF STANDARDS TO BE
APPLIED.—The accreditation type or standards ap-
plied for each school shall be determined by the
school board of the school, in consultation with the
Administrator of the school, provided that in the
case where the School Board and the Administrator
525
HR 1 PCS
fail to agree on the type of accreditation and stand-
ards to apply, the decision of the school board with
the approval of the tribal governing body shall be
final.
‘‘(3) ASSISTANCE
TO
SCHOOL
BOARDS.—The
Secretary, through contracts and grants, shall assist
school boards of contract or grant schools in imple-
mentation of the standards established under sub-
sections (c) and (d), if the school boards request
that such standards, in part or in whole, be imple-
mented.
‘‘(4) FISCAL CONTROL AND FUND ACCOUNTING
STANDARDS.—The Bureau shall, either directly or
through contract with an Indian organization, estab-
lish a consistent system of reporting standards for
fiscal control and fund accounting for all contract
and grant schools. Such standards shall provide data
comparable to those used by Bureau operated
schools.
‘‘(g) ANNUAL PLAN
FOR MEETING
OF STAND-
ARDS.—Except as provided in subsections (e) and (f), the
Secretary shall begin to implement the standards estab-
lished under this section immediately upon the date of
their establishment. On an annual basis, the Secretary
shall submit to the appropriate committees of Congress,
526
HR 1 PCS
all Bureau funded schools, and the tribal governing bodies
of such schools a detailed plan to bring all Bureau schools
and contract or grant schools up to the level required by
the applicable standards established under this section.
Such plan shall include detailed information on the status
of each school’s educational program in relation to the ap-
plicable standards established under this section, specific
cost estimates for meeting such standards at each school
and specific timelines for bringing each school up to the
level required by such standards.
‘‘(h) CLOSURE OR CONSOLIDATION OF SCHOOLS.—
‘‘(1) IN GENERAL.—Except as specifically re-
quired by statute, no school or peripheral dormitory
operated by the Bureau on or after January 1,
1992, may be closed or consolidated or have its pro-
gram substantially curtailed unless done according
to the requirements of this subsection.
‘‘(2) EXCEPTIONS.—This subsection shall not
apply—
‘‘(A) in those cases where the tribal gov-
erning body, or the local school board concerned
(if so designated by the tribal governing body),
requests closure or consolidation; or
‘‘(B) when a temporary closure, consolida-
tion, or substantial curtailment is required by
527
HR 1 PCS
plant conditions which constitute an immediate
hazard to health and safety.
‘‘(3) REGULATIONS.—The Secretary shall, by
regulation, promulgate standards and procedures for
the closure, transfer to another authority, consolida-
tion, or substantial curtailment of Bureau schools, in
accordance with the requirements of this subsection.
‘‘(4) NOTICE.—Whenever closure, transfer to
another authority, consolidation, or substantial cur-
tailment of a school is under active consideration or
review by any division of the Bureau or the Depart-
ment of the Interior, the affected tribe, tribal gov-
erning body, and designated local school board, will
be notified immediately, kept fully and currently in-
formed, and afforded an opportunity to comment
with respect to such consideration or review. When
a formal decision is made to close, transfer to an-
other authority, consolidate, or substantially curtail
a school, the affected tribe, tribal governing body,
and designated school board shall be notified at least
6 months prior to the end of the school year pre-
ceding the proposed closure date. Copies of any such
notices and information shall be transmitted prompt-
ly to the appropriate committees of Congress and
published in the Federal Register.
528
HR 1 PCS
‘‘(5) REPORT.—The Secretary shall make a re-
port to the appropriate committees of Congress, the
affected tribe, and the designated school board de-
scribing the process of the active consideration or re-
view referred to in paragraph (4). The report shall
include a study of the impact of such action on the
student population, identify those students with par-
ticular educational and social needs, and ensure that
alternative services are available to such students.
Such report shall include the description of the con-
sultation conducted between the potential service
provider, current service provider, parents, tribal
representatives and the tribe or tribes involved, and
the Director of the Office of Indian Education Pro-
grams within the Bureau regarding such students.
‘‘(6) LIMITATION
ON
CERTAIN
ACTIONS.—No
irrevocable action may be taken in furtherance of
any such proposed school closure, transfer to an-
other authority, consolidation, or substantial curtail-
ment (including any action which would prejudice
the personnel or programs of such school) prior to
the end of the first full academic year after such re-
port is made.
‘‘(7) TRIBAL GOVERNING BODY APPROVAL RE-
QUIRED FOR CERTAIN ACTIONS.—The Secretary may
529
HR 1 PCS
terminate, contract, transfer to any other authority,
consolidate, or substantially curtail the operation or
facilities of—
‘‘(A) any Bureau funded school that is op-
erated on or after of January 1, 1999;
‘‘(B) any program of such a school that is
operated on or after January 1, 1999; or
‘‘(C) any school board of a school operated
under a grant under the Tribally Controlled
Schools Act of 1988,
only if the tribal governing body approves such ac-
tion.
‘‘(i) APPLICATION FOR CONTRACTS OR GRANTS FOR
NON-BUREAU FUNDED SCHOOLS OR EXPANSION OF BU-
REAU FUNDED SCHOOLS.—
‘‘(1) IN GENERAL.—(A)(i) The Secretary shall
only consider the factors described in subparagraph
(B) in reviewing—
‘‘(I) applications from any tribe for the
awarding of a contract or grant for a school
that is not a Bureau funded school; and
‘‘(II) applications from any tribe or school
board of any Bureau funded school for—
‘‘(aa) a school which is not a Bureau
funded school; or
530
HR 1 PCS
‘‘(bb) the expansion of a Bureau
funded school which would increase the
amount of funds received by the Indian
tribe or school board under section 1127.
‘‘(ii) With respect to applications described in
this subparagraph, the Secretary shall give consider-
ation to all the factors described in subparagraph
(B), but no such application shall be denied based
primarily upon the geographic proximity of com-
parable public education.
‘‘(B) With respect to applications described in
subparagraph (A) the Secretary shall consider the
following factors relating to the program and serv-
ices that are the subject of the application:
‘‘(i) The adequacy of the facilities or the
potential to obtain or provide adequate facili-
ties.
‘‘(ii) Geographic and demographic factors
in the affected areas.
‘‘(iii) The adequacy of the applicant’s pro-
gram plans or, in the case of a Bureau funded
school, of projected needs analysis done either
by the tribe or the Bureau.
‘‘(iv) Geographic proximity of comparable
public education.
531
HR 1 PCS
‘‘(v) The stated needs of all affected par-
ties, including students, families, tribal govern-
ments at both the central and local levels, and
school organizations.
‘‘(vi) Adequacy and comparability of pro-
grams already available.
‘‘(vii) Consistency of available programs
with tribal educational codes or tribal legisla-
tion on education.
‘‘(viii) The history and success of these
services for the proposed population to be
served, as determined from all factors, including
but not limited to standardized examination
performance.
‘‘(2) DETERMINATION
ON
APPLICATION.—(A)
The Secretary shall make a determination of wheth-
er to approve any application described in paragraph
(1)(A) not later than 180 days after such applica-
tion is submitted to the Secretary.
‘‘(B) If the Secretary fails to make the deter-
mination with respect to an application by the date
described in subparagraph (A), the application shall
be treated a having been approved by the Secretary.
‘‘(3) REQUIREMENTS FOR APPLICATIONS.—(A)
Notwithstanding paragraph (2)(B), an application
532
HR 1 PCS
described in paragraph (1)(A) may be approved by
the Secretary only if—
‘‘(i) the application has been approved by
the tribal governing body of the students served
by (or to be served by) the school or program
that is the subject of the application; and
‘‘(ii) written evidence of such approval is
submitted with the application.
‘‘(B) Each application described in paragraph
(1)(A) shall provide information concerning each of
the factors described in paragraph (1)(B).
‘‘(4) DENIAL OF APPLICATIONS.—Whenever the
Secretary makes a determination to deny approval of
any application described in paragraph (1)(A), the
Secretary shall—
‘‘(A) state the objections in writing to the
applicant not later 180 days after the applica-
tion is submitted to the Secretary;
‘‘(B) provide assistance to the applicant to
overcome stated objections; and
‘‘(C) provide the applicant a hearing,
under the same rules and regulations pertaining
to the Indian Self-Determination and Education
Assistance Act and an opportunity to appeal
the objections raised by the Secretary.
533
HR 1 PCS
‘‘(5) EFFECTIVE DATE OF A SUBJECT APPLICA-
TION.—(A) Except as otherwise provided in this
paragraph, the action which is the subject of any ap-
plication described in paragraph (1)(A) that is ap-
proved by the Secretary shall become effective at the
beginning of the academic year following the fiscal
year in which the application is approved, or at an
earlier date determined by the Secretary.
‘‘(B) If an application is treated as having been
approved by the Secretary under paragraph (2)(B),
the action that is the subject of the application shall
become effective on the date that is 18 months after
the date on which the application is submitted to the
Secretary, or at an earlier date determined by the
Secretary.
‘‘(6) STATUTORY CONSTRUCTION.—Nothing in
this section shall be read so as to preclude the ex-
pansion of grades and related facilities at a Bureau
funded school where such expansion and the mainte-
nance of such expansion is occasioned or paid for
with non-Bureau funds.
‘‘(j) GENERAL USE OF FUNDS.—Funds received by
Bureau funded schools from the Bureau of Indian Affairs
and under any program from the Department of Edu-
cation or any other Federal agency for the purpose of pro-
534
HR 1 PCS
viding education or related services may be used for
schoolwide projects to improve the educational program
for all Indian students.
‘‘(k) STUDY ON ADEQUACY OF FUNDS AND FOR-
MULAS.—The Comptroller General shall conduct a study,
in consultation with Indian tribes and local school boards,
to determine the adequacy of funding, and formulas used
by the Bureau to determine funding, for programs oper-
ated by Bureau funded schools, taking into account unique
circumstances applicable to Bureau funded schools, as well
as expenditures for comparable purposes in public schools
nationally. Upon completion of the study, the Secretary
of the Interior shall take such action as necessary to en-
sure distribution of the findings of the study to all affected
Indian tribes, local school boards, and associations of local
school boards.
‘‘SEC. 1122. NATIONAL CRITERIA FOR HOME-LIVING SITUA-
TIONS.
‘‘(a) IN GENERAL.—The Secretary, in consultation
with the Secretary of Education, Indian organizations and
tribes, and Bureau funded schools, shall revise the na-
tional standards for home-living (dormitory) situations to
include such factors as heating, lighting, cooling, adult-
child ratios, needs for counselors (including special needs
related to off-reservation home-living (dormitory) situa-
535
HR 1 PCS
tions), therapeutic programs, space, and privacy. Such
standards shall be implemented in Bureau operated
schools, and shall serve as minimum standards for con-
tract or grant schools. Once established, any revisions of
such standards shall be developed according to the re-
quirements established under section 1138A.
‘‘(b) IMPLEMENTATION.—The Secretary shall imple-
ment the revised standards established under this section
immediately upon their completion.
‘‘(c) PLAN.—At the time of each annual budget sub-
mission for Bureau educational services is presented, the
Secretary shall submit to the appropriate committees of
Congress, the tribes, and the affected schools, and publish
in the Federal Register, a detailed plan to bring all Bu-
reau funded schools that provide home-living (dormitory)
situations up to the standards established under this sec-
tion. Such plan shall include a statement of the relative
needs of each Bureau funded home-living (dormitory)
school, projected future needs of each Bureau funded
home-living (dormitory) school, detailed information on
the status of each school in relation to the standards es-
tablished under this section, specific cost estimates for
meeting each standard for each such school, aggregate
cost estimates for bringing all such schools into compli-
ance with the criteria established under this section, and
536
HR 1 PCS
specific timelines for bringing each school into compliance
with such standards.
‘‘(d) WAIVER.—The criteria established under this
section may be waived in the same manner as the stand-
ards provided under section 1121(c) may be waived.
‘‘(e) CLOSURE FOR FAILURE TO MEET STANDARDS
PROHIBITED.—No school in operation on or before Janu-
ary 1, 1987 (regardless of compliance or noncompliance
with the criteria established under this section), may be
closed, transferred to another authority, consolidated, or
have its program substantially curtailed for failure to meet
the criteria.
‘‘SEC. 1123. CODIFICATION OF REGULATIONS.
‘‘(a) PART 32 OF TITLE 25 OF CODE OF FEDERAL
REGULATIONS.—The provisions of part 32 of title 25 of
the Code of Federal Regulations, as in effect on January
1, 1987, are incorporated into this Act and shall be treat-
ed as though such provisions are set forth in this sub-
section. Such provisions may be altered only by means of
an Act of Congress. To the extent that such provisions
of part 32 do not conform with this Act or any statutory
provision of law enacted before November 1, 1978, the
provisions of this Act and the provisions of such other
statutory law shall govern.
537
HR 1 PCS
‘‘(b) REGULATION DEFINED.—For purposes of this
part, the term ‘regulation’ means any rules, regulations,
guidelines, interpretations, orders, or requirements of gen-
eral applicability prescribed by any officer or employee of
the executive branch.
‘‘SEC. 1124. SCHOOL BOUNDARIES.
‘‘(a) ESTABLISHMENT
BY SECRETARY.—The Sec-
retary shall establish, by regulation, separate geographical
attendance areas for each Bureau funded school.
‘‘(b) ESTABLISHMENT BY TRIBAL BODY.—In any
case where there is more than one Bureau funded school
located on an Indian reservation, at the direction of the
tribal governing body, the relevant school boards of the
Bureau funded schools on the reservation may, by mutual
consent, establish the relevant attendance areas for such
schools, subject to the approval of the tribal governing
body. Any such boundaries so established shall be accepted
by the Secretary.
‘‘(c) BOUNDARY REVISIONS.—
‘‘(1) IN GENERAL.—On or after July 1, 2001,
no geographical attendance area shall be revised or
established with respect to any Bureau funded
school unless the tribal governing body or the local
school board concerned (if so designated by the trib-
al governing body) has been afforded—
538
HR 1 PCS
‘‘(A) at least 6 months notice of the inten-
tion of the Bureau to revise or establish such
attendance area; and
‘‘(B) the opportunity to propose alternative
boundaries.
Any tribe may petition the Secretary for revision of
existing attendance area boundaries. The Secretary
shall accept such proposed alternative or revised
boundaries unless the Secretary finds, after con-
sultation with the affected tribe or tribes, that such
revised boundaries do not reflect the needs of the In-
dian students to be served or do not provide ade-
quate stability to all of the affected programs. The
Secretary shall cause such revisions to be published
in the Federal Register.
‘‘(2) TRIBAL RESOLUTION DETERMINATION.—
Nothing in this section shall be interpreted as deny-
ing a tribal governing body the authority, on a con-
tinuing basis, to adopt a tribal resolution allowing
parents the choice of the Bureau funded school their
children may attend, regardless of the attendance
boundaries established under this section.
‘‘(d) FUNDING RESTRICTIONS.—The Secretary shall
not deny funding to a Bureau funded school for any eligi-
ble Indian student attending the school solely because that
539
HR 1 PCS
student’s home or domicile is outside of the geographical
attendance area established for that school under this sec-
tion. No funding shall be made available without tribal au-
thorization to enable a school to provide transportation for
any student to or from the school and a location outside
the approved attendance area of the school.
‘‘(e) RESERVATION
AS BOUNDARY.—In any case
where there is only one Bureau funded program located
on an Indian reservation, the attendance area for the pro-
gram shall be the boundaries (established by treaty, agree-
ment, legislation, court decisions, or executive decisions
and as accepted by the tribe) of the reservation served,
and those students residing near the reservation shall also
receive services from such program.
‘‘(f) OFF-RESERVATION HOME-LIVING (DORMITORY)
SCHOOLS.—Notwithstanding any geographical attendance
areas, attendance at off-reservation home-living (dor-
mitory) schools shall include students requiring special
emphasis programs to be implemented at each off-reserva-
tion home-living (dormitory) school. Such attendance shall
be coordinated between education line officers, the family,
and the referring and receiving programs.
‘‘SEC. 1125. FACILITIES CONSTRUCTION.
‘‘(a) COMPLIANCE WITH HEALTH
AND SAFETY
STANDARDS.—The Secretary shall immediately begin to
540
HR 1 PCS
bring all schools, dormitories, and other Indian education-
related facilities operated by the Bureau or under contract
or grant with the Bureau into compliance with all applica-
ble tribal, Federal, or State health and safety standards,
whichever provides greater protection (except that the
tribal standards to be applied shall be no greater than any
otherwise applicable Federal or State standards), with sec-
tion 504 of the Rehabilitation Act of 1973, and with the
Americans with Disabilities Act of 1990. Nothing in this
section shall require termination of the operations of any
facility which does not comply with such provisions and
which is in use on the date of the enactment of the No
Child Left Behind Act of 2001.
‘‘(b) COMPLIANCE PLAN.—At the time that the an-
nual budget request for Bureau educational services is
presented, the Secretary shall submit to the appropriate
committees of Congress a detailed plan to bring all facili-
ties covered under subsection (a) of this section into com-
pliance with the standards referred to in subsection (a).
Such plan shall include detailed information on the status
of each facility’s compliance with such standards, specific
cost estimates for meeting such standards at each school,
and specific timelines for bringing each school into compli-
ance with such standards.
‘‘(c) CONSTRUCTION PRIORITIES.—
541
HR 1 PCS
‘‘(1) SYSTEM TO ESTABLISH PRIORITIES.—On
an annual basis the Secretary shall submit to the
appropriate committees of Congress and cause to be
published in the Federal Register, the system used
to establish priorities for replacement and construc-
tion projects for Bureau funded schools and home-
living schools, including boarding schools and dor-
mitories. At the time any budget request for edu-
cation is presented, the Secretary shall publish in
the Federal Register and submit with the budget re-
quest the current list of all Bureau funded school
construction priorities.
‘‘(2) LONG-TERM
CONSTRUCTION
AND
RE-
PLACEMENT
LIST.—In addition to the plan sub-
mitted under subsection (b), the Secretary shall—
‘‘(A) not later than 18 months after the
date of the enactment of the No Child Left Be-
hind Act of 2001, establish a long-term con-
struction and replacement list for all Bureau
funded schools;
‘‘(B) using the list prepared under sub-
paragraph (A), propose a list for the orderly re-
placement of all Bureau funded education-re-
lated facilities over a period of 40 years to en-
542
HR 1 PCS
able planning and scheduling of budget re-
quests;
‘‘(C) cause the list prepared under sub-
section (B) to be published in the Federal Reg-
ister and allow a period of not less than 120
days for public comment;
‘‘(D) make such revisions to the list pre-
pared under subparagraph (B) as are appro-
priate based on the comments received; and
‘‘(E) cause the final list to be published in
the Federal Register.
‘‘(3) EFFECT ON OTHER LIST.—Nothing in this
section shall be construed as interfering with or
changing in any way the construction priority list as
it exists on the date of the enactment of the No
Child Left Behind Act of 2001.
‘‘(d) 
HAZARDOUS
CONDITION
AT
BUREAU
SCHOOL.—
‘‘(1) CLOSURE OR CONSOLIDATION.—A Bureau
funded school may be closed or consolidated, and the
programs of a Bureau funded school may be sub-
stantially curtailed by reason of plant conditions
that constitute an immediate hazard to health and
safety only if a health and safety officer of the Bu-
543
HR 1 PCS
reau determines that such conditions exist at the
Bureau funded school.
‘‘(2) INSPECTION.—(A) After making a deter-
mination described in paragraph (1), the Bureau
health and safety officer shall conduct an inspection
of the condition of such plant accompanied by an ap-
propriate tribal, county, municipal, or State health
and safety officer in order to determine whether con-
ditions at such plant constitute an immediate hazard
to health and safety. Such inspection shall be com-
pleted by not later than the date that is 30 days
after the date on which the action described in para-
graph (1) is taken. No further negative action may
be taken unless the findings are concurred in by the
second, non-Bureau of Indian Affairs inspector.
‘‘(B) If the health and safety officer conducting
the inspection of a plant required under subpara-
graph (A) determines that conditions at the plant do
not constitute an immediate hazard to health and
safety, any consolidation or curtailment that was
made under paragraph (1) shall immediately cease
and any school closed by reason of conditions at the
plant shall be reopened immediately.
‘‘(C) If a Bureau funded school is temporarily
closed or consolidated or the programs of a Bureau
544
HR 1 PCS
funded school are substantially curtailed under this
subsection and the Secretary determines that the
closure, consolidation, or curtailment will exceed 1
year, the Secretary shall submit to the Congress, by
not later than 6 months after the date on which the
closure, consolidation, or curtailment was initiated, a
report which sets forth the reasons for such tem-
porary actions, the actions the Secretary is taking to
eliminate the conditions that constitute the hazard,
and an estimated date by which such actions will be
concluded.
‘‘(e) FUNDING REQUIREMENT.—
‘‘(1) DISTRIBUTION
OF
FUNDS.—Beginning
with the fiscal year following the year of the date of
the enactment of the No Child Left Behind Act of
2001, all funds appropriated for the operations and
maintenance of Bureau funded schools shall be dis-
tributed by formula to the schools. No funds from
this account may be retained or segregated by the
Bureau to pay for administrative or other costs of
any facilities branch or office, at any level of the Bu-
reau.
‘‘(2) REQUIREMENTS FOR CERTAIN USES.—No
funds shall be withheld from the distribution to the
budget of any school operated under contract or
545
HR 1 PCS
grant by the Bureau for maintenance or any other
facilities or road related purpose, unless such school
has consented, as a modification to the contract or
in writing for grants schools, to the withholding of
such funds, including the amount thereof, the pur-
pose for which the funds will be used, and the
timeline for the services to be provided. The school
may, at the end of any fiscal year, cancel an agree-
ment under this paragraph upon giving the Bureau
30 days notice of its intent to do so.
‘‘(f) NO REDUCTION IN FEDERAL FUNDING.—Noth-
ing in this section shall be construed to diminish any Fed-
eral funding due to the receipt by the school of funding
for facilities improvement or construction from a State or
any other source.
‘‘SEC. 1126. BUREAU OF INDIAN AFFAIRS EDUCATION FUNC-
TIONS.
‘‘(a) FORMULATION AND ESTABLISHMENT OF POL-
ICY AND PROCEDURE; SUPERVISION OF PROGRAMS AND
EXPENDITURES.—The Secretary shall vest in the Assist-
ant Secretary for Indian Affairs all functions with respect
to formulation and establishment of policy and procedure
and supervision of programs and expenditures of Federal
funds for the purpose of Indian education administered
by the Bureau. The Assistant Secretary shall carry out
546
HR 1 PCS
such functions through the Director of the Office of Indian
Education Programs.
‘‘(b) DIRECTION AND SUPERVISION OF PERSONNEL
OPERATIONS.—Not later than 6 months after the date of
the enactment of the No Child Left Behind Act of 2001,
the Director of the Office of Indian Education Programs
shall direct and supervise the operations of all personnel
directly and substantially involved in the provision of edu-
cation services by the Bureau, including school or institu-
tion custodial or maintenance personnel, facilities manage-
ment, contracting, procurement, and finance personnel.
The Assistant Secretary for Indian Affairs shall coordi-
nate the transfer of functions relating to procurement,
contracts, operation, and maintenance of schools and
other support functions to the Director.
‘‘(c) EVALUATION
OF PROGRAMS; SERVICES
AND
SUPPORT FUNCTIONS; TECHNICAL AND COORDINATING
ASSISTANCE.—Education personnel who are under the di-
rection and supervision of the Director of the Office of
Indian Education Programs in accordance with the first
sentence of subsection (b) shall—
‘‘(1) monitor and evaluate Bureau education
programs;
547
HR 1 PCS
‘‘(2) provide all services and support functions
for education programs with respect to personnel
matters involving staffing actions and functions; and
‘‘(3) provide technical and coordinating assist-
ance in areas such as procurement, contracting,
budgeting, personnel, curriculum, and operation and
maintenance of school facilities.
‘‘(d) CONSTRUCTION, IMPROVEMENT, OPERATION,
AND MAINTENANCE OF FACILITIES.—
‘‘(1) PLAN FOR CONSTRUCTION.—The Assistant
Secretary shall submit in the annual budget a
plan—
‘‘(A) for school facilities to be constructed
under section 1125(c);
‘‘(B) for establishing priorities among
projects and for the improvement and repair of
educational facilities, which together shall form
the basis for the distribution of appropriated
funds; and
‘‘(C) for capital improvements to be made
over the five succeeding years.
‘‘(2) PROGRAM FOR OPERATION AND MAINTE-
NANCE.—
‘‘(A) 
ESTABLISHMENT.—The 
Assistant
Secretary shall establish a program, including
548
HR 1 PCS
the distribution of appropriated funds, for the
operation and maintenance of education facili-
ties. Such program shall include—
‘‘(i) a method of computing the
amount necessary for each educational fa-
cility;
‘‘(ii) similar treatment of all Bureau
funded schools;
‘‘(iii) a notice of an allocation of ap-
propriated funds from the Director of the
Office of Indian Education Programs di-
rectly to the education line officers and ap-
propriate school officials;
‘‘(iv) a method for determining the
need for, and priority of, facilities repair
and maintenance projects, both major and
minor. In making such determination, the
Assistant Secretary shall cause to be con-
ducted a series of meetings at the agency
and area level with representatives of the
Bureau funded schools in those areas and
agencies to receive comment on the lists
and prioritization of such projects; and
‘‘(v) a system for the conduct of rou-
tine preventive maintenance.
549
HR 1 PCS
‘‘(B) LOCAL
SUPERVISORS.—The appro-
priate education line officers shall make ar-
rangements for the maintenance of education
facilities with the local supervisors of the Bu-
reau maintenance personnel. The local super-
visors of Bureau maintenance personnel shall
take appropriate action to implement the deci-
sions made by the appropriate education line of-
ficers, except that no funds under this chapter
may be authorized for expenditure unless such
appropriate education line officer is assured
that the necessary maintenance has been, or
will be, provided in a reasonable manner.
‘‘(3) IMPLEMENTATION.—The requirements of
this subsection shall be implemented as soon as
practicable after the date of the enactment of the No
Child Left Behind Act of 2001.
‘‘(e) ACCEPTANCE OF GIFTS AND BEQUESTS.—Not-
withstanding any other provision of law, the Director shall
promulgate guidelines for the establishment of mecha-
nisms for the acceptance of gifts and bequests for the use
and benefit of particular schools or designated Bureau op-
erated education programs, including, where appropriate,
the establishment and administration of trust funds.
When a Bureau operated program is the beneficiary of
550
HR 1 PCS
such a gift or bequest, the Director shall make provisions
for monitoring its use and shall report to the appropriate
committees of Congress the amount and terms of such gift
or bequest, the manner in which such gift or bequest shall
be used, and any results achieved by such action.
‘‘(f) FUNCTIONS CLARIFIED.—For the purpose of
this section, the term ‘functions’ includes powers and du-
ties.
‘‘SEC. 1127. ALLOTMENT FORMULA.
‘‘(a) FACTORS CONSIDERED; REVISION TO REFLECT
STANDARDS.—
‘‘(1) FORMULA.—The Secretary shall establish,
by regulation adopted in accordance with section
1138A, a formula for determining the minimum an-
nual amount of funds necessary to sustain each Bu-
reau funded school. In establishing such formula,
the Secretary shall consider—
‘‘(A) the number of eligible Indian stu-
dents served and total student population of the
school;
‘‘(B) special cost factors, such as—
‘‘(i) the isolation of the school;
‘‘(ii) the need for special staffing,
transportation, or educational programs;
‘‘(iii) food and housing costs;
551
HR 1 PCS
‘‘(iv) maintenance and repair costs as-
sociated with the physical condition of the
educational facilities;
‘‘(v) special transportation and other
costs of isolated and small schools;
‘‘(vi) the costs of home-living (dor-
mitory) arrangements, where determined
necessary by a tribal governing body or
designated school board;
‘‘(vii) costs associated with greater
lengths of service by education personnel;
‘‘(viii) the costs of therapeutic pro-
grams for students requiring such pro-
grams; and
‘‘(ix) special costs for gifted and tal-
ented students;
‘‘(C) the cost of providing academic serv-
ices which are at least equivalent to those pro-
vided by public schools in the State in which
the school is located; and
‘‘(D) such other relevant factors as the
Secretary determines are appropriate.
‘‘(2) REVISION OF FORMULA.—Upon the estab-
lishment of the standards required in sections 1121
and 1122, the Secretary shall revise the formula es-
552
HR 1 PCS
tablished under this subsection to reflect the cost of
funding such standards. Not later than January 1,
2003, the Secretary shall review the formula estab-
lished under this section and shall take such steps
as are necessary to increase the availability of coun-
seling and therapeutic programs for students in off-
reservation home-living (dormitory) schools and
other Bureau operated residential facilities. Concur-
rent with such action, the Secretary shall review the
standards established under section 1122 to be cer-
tain that adequate provision is made for parental no-
tification regarding, and consent for, such counseling
and therapeutic programs.
‘‘(b) PRO RATA ALLOTMENT.—Notwithstanding any
other provision of law, Federal funds appropriated for the
general local operation of Bureau funded schools shall be
allotted pro rata in accordance with the formula estab-
lished under subsection (a).
‘‘(c) ANNUAL
ADJUSTMENT; RESERVATION
OF
AMOUNT FOR SCHOOL BOARD ACTIVITIES.—
‘‘(1) ANNUAL
ADJUSTMENT.—For fiscal year
2003, and for each subsequent fiscal year, the Sec-
retary shall adjust the formula established under
subsection (a) to ensure that the formula does the
following:
553
HR 1 PCS
‘‘(A) Uses a weighted unit of 1.2 for each
eligible Indian student enrolled in the seventh
and eighth grades of the school in considering
the number of eligible Indian students served
by the school.
‘‘(B) Considers a school with an enroll-
ment of less than 50 eligible Indian students as
having an average daily attendance of 50 eligi-
ble Indian students for purposes of imple-
menting the adjustment factor for small
schools.
‘‘(C) Takes into account the provision of
residential services on less than a 9-month basis
at a school when the school board and super-
visor of the school determine that a less than
9-month basis will be implemented for the
school year involved.
‘‘(D) Uses a weighted unit of 2.0 for each
eligible Indian student that—
‘‘(i) is gifted and talented; and
‘‘(ii) is enrolled in the school on a full-
time basis,
in considering the number of eligible Indian
students served by the school.
554
HR 1 PCS
‘‘(E) Uses a weighted unit of 0.25 for each
eligible Indian student who is enrolled in a
yearlong credit course in an Indian or Native
language as part of the regular curriculum of a
school, in considering the number of eligible In-
dian students served by such school. The ad-
justment required under this subparagraph
shall be used for such school after—
‘‘(i) the certification of the Indian or
Native language curriculum by the school
board of such school to the Secretary, to-
gether with an estimate of the number of
full-time students expected to be enrolled
in the curriculum in the second school year
for which the certification is made; and
(ii) the funds appropriated for allot-
ment under this section are designated by
the appropriations Act appropriating such
funds as the amount necessary to imple-
ment such adjustment at such school with-
out reducing allotments made under this
section to any school by virtue of such ad-
justment.
‘‘(2) RESERVATION OF AMOUNT.—
555
HR 1 PCS
‘‘(A) IN GENERAL.—From the funds allot-
ted in accordance with the formula established
under subsection (a) for each Bureau school,
the local school board of such school may re-
serve an amount which does not exceed the
greater of—
‘‘(i) $8,000; or
‘‘(ii) the lesser of—
‘‘(I) $15,000; or
‘‘(II) 1 percent of such allotted
funds,
for school board activities for such school, in-
cluding (notwithstanding any other provision of
law) meeting expenses and the cost of member-
ship in, and support of, organizations engaged
in activities on behalf of Indian education.
‘‘(B) TRAINING.—Each school board shall
see that each new member of the school board
receives, within 12 months of the individual’s
assuming a position on the school board, 40
hours of training relevant to that individual’s
service on the board. Such training may include
legal issues pertaining to schools funded by the
Bureau, legal issues pertaining to school
556
HR 1 PCS
boards, ethics, and other topics deemed appro-
priate by the school board.
‘‘(d) RESERVATION
OF
AMOUNT
FOR
EMER-
GENCIES.—The Secretary shall reserve from the funds
available for distribution for each fiscal year under this
section an amount which, in the aggregate, shall equal 1
percent of the funds available for such purpose for that
fiscal year. Such funds shall be used, at the discretion of
the Director of the Office of Indian Education Programs,
to meet emergencies and unforeseen contingencies affect-
ing the education programs funded under this section.
Funds reserved under this subsection may only be ex-
pended for education services or programs, including
emergency repairs of educational facilities, at a schoolsite
(as defined by section 5204(c)(2) of the Tribally Con-
trolled Schools Act of 1988). Funds reserved under this
subsection shall remain available without fiscal year limi-
tation until expended. However, the aggregate amount
available from all fiscal years may not exceed 1 percent
of the current year funds. Whenever, the Secretary makes
funds available under this subsection, the Secretary shall
report such action to the appropriate committees of Con-
gress within the annual budget submission.
‘‘(e) 
SUPPLEMENTAL
APPROPRIATIONS.—Supple-
mental appropriations enacted to meet increased pay costs
557
HR 1 PCS
attributable to school level personnel shall be distributed
under this section.
‘‘(f) ELIGIBLE INDIAN STUDENT DEFINED.—For the
purpose of this section, the term ‘eligible Indian student’
means a student who—
‘‘(1) is a member of or is at least one-fourth de-
gree Indian blood descendant of a member of an In-
dian tribe which is eligible for the special programs
and services provided by the United States through
the Bureau because of their status as Indians; and
‘‘(2) resides on or near an Indian reservation or
meets the criteria for attendance at a Bureau off-
reservation home-living (dormitory) school.
‘‘(g) TUITION.—
‘‘(1) IN GENERAL.—An eligible Indian student
may not be charged tuition for attendance at a Bu-
reau school or contract or grant school. A student
attending a Bureau school under paragraph (2)(C)
may not be charged tuition for attendance at such
a school.
‘‘(2) ATTENDANCE OF NON-INDIAN STUDENTS
AT BUREAU SCHOOLS.—The Secretary may permit
the attendance at a Bureau school of a student who
is not an eligible Indian student if—
558
HR 1 PCS
‘‘(A) the Secretary determines that the
student’s attendance will not adversely affect
the school’s program for eligible Indian stu-
dents because of cost, overcrowding, or violation
of standards or accreditation;
‘‘(B) the school board consents;
‘‘(C) the student is a dependent of a Bu-
reau, Indian Health Service, or tribal govern-
ment employee who lives on or near the
schoolsite; or
‘‘(D) a tuition is paid for the student that
is not more than that charged by the nearest
public school district for out-of-district stu-
dents, and shall be in addition to the school’s
allocation under this section.
‘‘(3) ATTENDANCE OF NON-INDIAN STUDENTS
AT CONTRACT AND GRANT SCHOOLS.—The school
board of a contract or grant school may permit stu-
dents who are not eligible Indian students under this
subsection to attend its contract school or grant
school and any tuition collected for those students
shall be in addition to funding received under this
section.
‘‘(h) FUNDS AVAILABLE WITHOUT FISCAL YEAR
LIMITATION.—Notwithstanding any other provision of
559
HR 1 PCS
law, at the election of the school board of a Bureau school
made at any time during the fiscal year, a portion equal
to not more than 15 percent of the funds allocated with
respect to a school under this section for any fiscal year
shall remain available to the school for expenditure with-
out fiscal year limitation. The Assistant Secretary shall
take steps as may be necessary to implement this provi-
sion.
‘‘(i) STUDENTS AT RICHFIELD DORMITORY, RICH-
FIELD, UTAH.—Tuition for out-of-State Indian students
in home-living (dormitory) arrangements at the Richfield
dormitory in Richfield, Utah, who attend Sevier County
high schools in Richfield, Utah, shall be paid from the In-
dian school equalization program funds authorized in this
section and section 1130 at a rate not to exceed the
amounts per weighted student unit for that year for the
instruction of such students. No additional administrative
cost funds shall be added to the grant.
‘‘SEC. 1128. ADMINISTRATIVE COST GRANTS.
‘‘(a) 
GRANTS; 
EFFECT
UPON
APPROPRIATED
AMOUNTS.—
‘‘(1) GRANTS.—Subject to the availability of
appropriated funds, the Secretary shall provide
grants to each tribe or tribal organization operating
a contract school or grant school in the amount de-
560
HR 1 PCS
termined under this section with respect to the tribe
or tribal organization for the purpose of paying the
administrative and indirect costs incurred in oper-
ating contract or grant schools, provided that no
school operated as a stand-alone institution shall re-
ceive less than $200,000 per year for these pur-
poses, in order to—
‘‘(A) enable tribes and tribal organizations
operating such schools, without reducing direct
program services to the beneficiaries of the pro-
gram, to provide all related administrative over-
head services and operations necessary to meet
the requirements of law and prudent manage-
ment practice; and
‘‘(B) carry out other necessary support
functions which would otherwise be provided by
the Secretary or other Federal officers or em-
ployees, from resources other than direct pro-
gram funds, in support of comparable Bureau
operated programs.
‘‘(2) 
EFFECT
UPON
APPROPRIATED
AMOUNTS.—Amounts appropriated to fund the
grants provided under this section shall be in addi-
tion to, and shall not reduce, the amounts appro-
561
HR 1 PCS
priated for the program being administered by the
contract or grant school.
‘‘(b) DETERMINATION OF GRANT AMOUNT.—
‘‘(1) IN GENERAL.—The amount of the grant
provided to each tribe or tribal organization under
this section for each fiscal year shall be determined
by applying the administrative cost percentage rate
of the tribe or tribal organization to the aggregate
of the Bureau elementary and secondary functions
operated by the tribe or tribal organization for which
funds are received from or through the Bureau. The
administrative cost percentage rate determined
under subsection (c) does not apply to other pro-
grams operated by the tribe or tribal organization.
‘‘(2) DIRECT
COST
BASE
FUNDS.—The Sec-
retary shall—
‘‘(A) reduce the amount of the grant deter-
mined under paragraph (1) to the extent that
payments for administrative costs are actually
received by an Indian tribe or tribal organiza-
tion under any Federal education program in-
cluded in the direct cost base of the tribe or
tribal organization; and
‘‘(B) take such actions as may be nec-
essary to be reimbursed by any other depart-
562
HR 1 PCS
ment or agency of the Federal Government for
the portion of grants made under this section
for the costs of administering any program for
Indians that is funded by appropriations made
to such other department or agency.
‘‘(c) ADMINISTRATIVE COST PERCENTAGE RATE.—
‘‘(1) IN GENERAL.—For purposes of this sec-
tion, the administrative cost percentage rate for a
contract or grant school for a fiscal year is equal to
the percentage determined by dividing—
‘‘(A) the sum of—
‘‘(i) the amount equal to—
‘‘(I) the direct cost base of the
tribe or tribal organization for the fis-
cal year, multiplied by
‘‘(II) the minimum base rate;
plus
‘‘(ii) the amount equal to—
‘‘(I) the standard direct cost
base; multiplied by
‘‘(II) the maximum base rate; by
‘‘(B) the sum of—
‘‘(i) the direct cost base of the tribe or
tribal organization for the fiscal year; plus
‘‘(ii) the standard direct cost base.
563
HR 1 PCS
‘‘(2) ROUNDING.—The administrative cost per-
centage rate shall be determined to the 1⁄100 of a
decimal point.
‘‘(d) COMBINING FUNDS.—
‘‘(1) IN GENERAL.—Funds received by a tribe
or contract or grant school as grants under this sec-
tion for tribal elementary or secondary educational
programs may be combined by the tribe or contract
or grant school into a single administrative cost ac-
count without the necessity of maintaining separate
funding source accounting.
‘‘(2) INDIRECT
COST
FUNDS.—Indirect cost
funds for programs at the school which share com-
mon administrative services with tribal elementary
or secondary educational programs may be included
in the administrative cost account described in para-
graph (1).
‘‘(e) AVAILABILITY OF FUNDS.—Funds received as
grants under this section with respect to tribal elementary
or secondary education programs shall remain available to
the contract or grant school without fiscal year limitation
and without diminishing the amount of any grants other-
wise payable to the school under this section for any fiscal
year beginning after the fiscal year for which the grant
is provided.
564
HR 1 PCS
‘‘(f) TREATMENT
OF FUNDS.—Funds received as
grants under this section for Bureau funded programs op-
erated by a tribe or tribal organization under a contract
or agreement shall not be taken into consideration for pur-
poses of indirect cost underrecovery and overrecovery de-
terminations by any Federal agency for any other funds,
from whatever source derived.
‘‘(g) TREATMENT OF ENTITY OPERATING OTHER
PROGRAMS.—In applying this section and section 105 of
the Indian Self-Determination and Education Assistance
Act with respect to an Indian tribe or tribal organization
that—
‘‘(1) receives funds under this section for ad-
ministrative costs incurred in operating a contract or
grant school or a school operated under the Tribally
Controlled Schools Act of 1988; and
‘‘(2) operates one or more other programs
under a contract or grant provided under the Indian
Self-Determination and Education Assistance Act,
the Secretary shall ensure that the Indian tribe or tribal
organization is provided with the full amount of the ad-
ministrative costs that are associated with operating the
contract or grant school, and of the indirect costs, that
are associated with all of such other programs, provided
that funds appropriated for implementation of this section
565
HR 1 PCS
shall be used only to supply the amount of the grant re-
quired to be provided by this section.
‘‘(h) DEFINITIONS.—For purposes of this section:
‘‘(1) ADMINISTRATIVE
COST.—(A) The term
‘administrative cost’ means the costs of necessary
administrative functions which—
‘‘(i) the tribe or tribal organization incurs
as a result of operating a tribal elementary or
secondary educational program;
‘‘(ii) are not customarily paid by com-
parable Bureau operated programs out of direct
program funds; and
‘‘(iii) are either—
‘‘(I) normally provided for comparable
Bureau programs by Federal officials
using resources other than Bureau direct
program funds; or
‘‘(II) are otherwise required of tribal
self-determination program operators by
law or prudent management practice.
‘‘(B) The term ‘administrative cost’ may
include—
‘‘(i) contract or grant (or other agreement)
administration;
566
HR 1 PCS
‘‘(ii) executive, policy, and corporate lead-
ership and decisionmaking;
‘‘(iii) program planning, development, and
management;
‘‘(iv) fiscal, personnel, property, and pro-
curement management;
‘‘(v) related office services and record
keeping; and
‘‘(vi) costs of necessary insurance, audit-
ing, legal, safety and security services.
‘‘(2) BUREAU
ELEMENTARY
AND
SECONDARY
FUNCTIONS.—The term ‘Bureau elementary and sec-
ondary functions’ means—
‘‘(A) all functions funded at Bureau
schools by the Office;
‘‘(B) all programs—
‘‘(i) funds for which are appropriated
to other agencies of the Federal Govern-
ment; and
‘‘(ii) which are administered for the
benefit of Indians through Bureau schools;
and
‘‘(C) all operation, maintenance, and repair
funds for facilities and government quarters
used in the operation or support of elementary
567
HR 1 PCS
and secondary education functions for the ben-
efit of Indians, from whatever source derived.
‘‘(3) DIRECT COST BASE.—(A) Except as other-
wise provided in subparagraph (B), the direct cost
base of a tribe or tribal organization for the fiscal
year is the aggregate direct cost program funding
for all tribal elementary or secondary educational
programs operated by the tribe or tribal organization
during—
‘‘(i) the second fiscal year preceding such
fiscal year; or
‘‘(ii) if such programs have not been oper-
ated by the tribe or tribal organization during
the two preceding fiscal years, the first fiscal
year preceding such fiscal year.
‘‘(B) In the case of Bureau elementary or sec-
ondary education functions which have not pre-
viously been operated by a tribe or tribal organiza-
tion under contract, grant, or agreement with the
Bureau, the direct cost base for the initial year shall
be the projected aggregate direct cost program fund-
ing for all Bureau elementary and secondary func-
tions to be operated by the tribe or tribal organiza-
tion during that fiscal year.
568
HR 1 PCS
‘‘(4) MAXIMUM BASE RATE.—The term ‘max-
imum base rate’ means 50 percent.
‘‘(5) MINIMUM BASE RATE.—The term ‘min-
imum base rate’ means 11 percent.
‘‘(6) STANDARD DIRECT COST BASE.—The term
‘standard direct cost base’ means $600,000.
‘‘(7) TRIBAL
ELEMENTARY
OR
SECONDARY
EDUCATIONAL PROGRAMS.—The term ‘tribal elemen-
tary or secondary educational programs’ means all
Bureau elementary and secondary functions, to-
gether with any other Bureau programs or portions
of programs (excluding funds for social services that
are appropriated to agencies other than the Bureau
and are expended through the Bureau, funds for
major subcontracts, construction, and other major
capital expenditures, and unexpended funds carried
over from prior years) which share common adminis-
trative cost functions, that are operated directly by
a tribe or tribal organization under a contract,
grant, or agreement with the Bureau.
‘‘(i) STUDIES FOR DETERMINATION OF FACTORS AF-
FECTING COSTS; BASE RATES LIMITS; STANDARD DI-
RECT COST BASE; REPORT TO CONGRESS.—
‘‘(1) STUDIES.—Not later than 120 days after
the date of the enactment of the No Child Left Be-
569
HR 1 PCS
hind Act of 2001, the Director of the Office of In-
dian Education Programs shall—
‘‘(A) conduct such studies as may be need-
ed to establish an empirical basis for deter-
mining relevant factors substantially affecting
required administrative costs of tribal elemen-
tary and secondary education programs, using
the formula set forth in subsection (c); and
‘‘(B) conduct a study to determine—
‘‘(i) a maximum base rate which ensures
that the amount of the grants provided under
this section will provide adequate (but not ex-
cessive) funding of the administrative costs of
the smallest tribal elementary or secondary edu-
cational programs;
‘‘(ii) a minimum base rate which ensures
that the amount of the grants provided under
this section will provide adequate (but not ex-
cessive) funding of the administrative costs of
the largest tribal elementary or secondary edu-
cational programs; and
‘‘(iii) a standard direct cost base which is
the aggregate direct cost funding level for which
the percentage determined under subsection (c)
will—
570
HR 1 PCS
‘‘(I) be equal to the median between
the maximum base rate and the minimum
base rate; and
‘‘(II) ensure that the amount of the
grants provided under this section will pro-
vide adequate (but not excessive) funding
of the administrative costs of tribal ele-
mentary or secondary educational pro-
grams closest to the size of the program.
‘‘(2) GUIDELINES.—The studies required under
paragraph (1) shall—
‘‘(A) be conducted in full consultation (in
accordance with section 1131) with—
‘‘(i) the tribes and tribal organizations
that are affected by the application of the
formula set forth in subsection (c); and
‘‘(ii) all national and regional Indian
organizations of which such tribes and
tribal organizations are typically members;
‘‘(B) be conducted onsite with a represent-
ative statistical sample of the tribal elementary
or secondary educational programs under a con-
tract entered into with a nationally reputable
public accounting and business consulting firm;
571
HR 1 PCS
‘‘(C) take into account the availability of
skilled labor; commodities, business and auto-
matic data processing services, related Indian
preference and Indian control of education re-
quirements, and any other market factors found
substantially to affect the administrative costs
and efficiency of each such tribal elementary or
secondary educational program studied in order
to assure that all required administrative activi-
ties can reasonably be delivered in a cost effec-
tive manner for each such program, given an
administrative cost allowance generated by the
values, percentages, or other factors found in
the studies to be relevant in such formula;
‘‘(D) identify, and quantify in terms of
percentages of direct program costs, any gen-
eral factors arising from geographic isolation,
or numbers of programs administered, inde-
pendent of program size factors used to com-
pute a base administrative cost percentage in
such formula; and
‘‘(E) identify any other incremental cost
factors substantially affecting the costs of re-
quired administrative cost functions at any of
the tribal elementary or secondary educational
572
HR 1 PCS
programs studied and determine whether the
factors are of general applicability to other such
programs, and (if so) how the factors may ef-
fectively be incorporated into such formula.
‘‘(3) CONSULTATION
WITH
INSPECTOR
GEN-
ERAL.—In carrying out the studies required under
this subsection, the Director shall obtain the input
of, and afford an opportunity to participate to, the
Inspector General of the Department of the Interior.
‘‘(4) CONSIDERATION OF DELIVERY OF ADMIN-
ISTRATIVE SERVICES.—Determinations described in
paragraph (2)(C) shall be based on what is prac-
ticable at each location studied, given prudent man-
agement practice, irrespective of whether required
administrative services were actually or fully deliv-
ered at these sites, or whether other services were
delivered instead, during the period of the study.
‘‘(5) REPORT.—Upon completion of the studies
conducted under paragraph (1), the Director shall
submit to Congress a report on the findings of the
studies, together with determinations based upon
such studies that would affect the definitions set
forth under subsection (e) that are used in the for-
mula set forth in subsection (c).
573
HR 1 PCS
‘‘(6) PROJECTION
OF
COSTS.—The Secretary
shall include in the Bureau’s justification for each
appropriations request beginning in the first fiscal
year after the completion of the studies conducted
under paragraph (1), a projection of the overall
costs associated with the formula set forth in sub-
section (c) for all tribal elementary or secondary
education programs which the Secretary expects to
be funded in the fiscal year for which the appropria-
tions are sought.
‘‘(7) DETERMINATION OF PROGRAM SIZE.—For
purposes of this subsection, the size of tribal elemen-
tary or secondary educational programs is deter-
mined by the aggregate direct cost program funding
level for all Bureau funded programs which share
common administrative cost functions.
‘‘(j) AUTHORIZATION OF APPROPRIATIONS.—
‘‘(1) IN GENERAL.—There are authorized to be
appropriated such sums as necessary to carry out
this section.
‘‘(2) REDUCTIONS.—If the total amount of
funds necessary to provide grants to tribes and trib-
al organizations in the amounts determined under
subsection (b) for a fiscal year exceeds the amount
of funds appropriated to carry out this section for
574
HR 1 PCS
such fiscal year, the Secretary shall reduce the
amount of each grant determined under subsection
(b) for such fiscal year by an amount that bears the
same relationship to such excess as the amount of
such grants determined under subsection (b) bears
to the total of all grants determined under sub-
section (b) section for all tribes and tribal organiza-
tions for such fiscal year.
‘‘(k) APPLICABILITY
TO
SCHOOLS
OPERATING
UNDER
TRIBALLY
CONTROLLED
SCHOOLS
ACT
OF
1988.—The provisions of this section shall also apply to
those schools operating under the Tribally Controlled
Schools Act of 1988.
‘‘SEC. 1129. DIVISION OF BUDGET ANALYSIS.
‘‘(a) ESTABLISHMENT.—Not later than 12 months
after the date of the enactment of the No Child Left Be-
hind Act of 2001, the Secretary shall establish within the
Office of Indian Education Programs a Division of Budget
Analysis (hereinafter referred to as the ‘Division’). Such
Division shall be under the direct supervision and control
of the Director of the Office.
‘‘(b) FUNCTIONS.—In consultation with the tribal
governing bodies and tribal school boards, the Director of
the Office, through the Division, shall conduct studies,
surveys, or other activities to gather demographic informa-
575
HR 1 PCS
tion on Bureau funded schools and project the amount
necessary to provide Indian students in such schools the
educational program set forth in this part.
‘‘(c) ANNUAL REPORTS.—Not later than the date
that the Assistant Secretary for Indian Affairs makes the
annual budget submission, for each fiscal year after the
date of the enactment of the No Child Left Behind Act
of 2001, the Director of the Office shall submit to the
appropriate committees of Congress (including the Appro-
priations committees), all Bureau funded schools, and the
tribal governing bodies of such schools, a report which
shall contain—
‘‘(1) projections, based upon the information
gathered pursuant to subparagraph (b) and any
other relevant information, of amounts necessary to
provide Indian students in Bureau funded schools
the educational program set forth in this part;
‘‘(2) a description of the methods and formulas
used to calculate the amounts projected pursuant to
paragraph (1); and
‘‘(3) such other information as the Director of
the Office considers appropriate.
‘‘(d) USE OF REPORTS.—The Director of the Office
and the Assistant Secretary for Indian Affairs shall use
576
HR 1 PCS
the annual report required by subsection (c) when pre-
paring their annual budget submissions.
‘‘SEC. 1130. UNIFORM DIRECT FUNDING AND SUPPORT.
‘‘(a) ESTABLISHMENT OF SYSTEM AND FORWARD
FUNDING.—
‘‘(1) IN GENERAL.—The Secretary shall estab-
lish, by regulation adopted in accordance with sec-
tion 1138, a system for the direct funding and sup-
port of all Bureau funded schools. Such system shall
allot funds in accordance with section 1127. All
amounts appropriated for distribution under this
section may be made available under paragraph (2).
‘‘(2) TIMING FOR USE OF FUNDS.—(A) For the
purposes of affording adequate notice of funding
available pursuant to the allotments made under sec-
tion 1127, amounts appropriated in an appropria-
tions Act for any fiscal year shall become available
for obligation by the affected schools on July 1 of
the fiscal year in which such amounts are appro-
priated without further action by the Secretary, and
shall remain available for obligation through the suc-
ceeding fiscal year.
‘‘(B) The Secretary shall, on the basis of the
amount appropriated in accordance with this
paragraph—
577
HR 1 PCS
‘‘(i) publish, not later than July 1 of the
fiscal year for which the funds are appro-
priated, allotments to each affected school made
under section 1127 of 85 percent of such ap-
propriation; and
‘‘(ii) publish, not later than September 30
of such fiscal year, the allotments to be made
under section 1127 of the remaining 15 percent
of such appropriation, adjusted to reflect the
actual student attendance.
‘‘(3) LIMITATION.—(A) Notwithstanding any
other provision of law or regulation, the supervisor
of a Bureau funded school may expend an aggregate
of not more than $50,000 of the amount allotted the
school under section 1127 to acquire materials, sup-
plies, equipment, services, operation, and mainte-
nance for the school without competitive bidding if—
‘‘(i) the cost for any single item purchased
does not exceed $15,000;
‘‘(ii) the school board approves the pro-
curement;
‘‘(iii) the supervisor certifies that the cost
is fair and reasonable;
‘‘(iv) the documents relating to the pro-
curement executed by the supervisor or other
578
HR 1 PCS
school staff cite this paragraph as authority for
the procurement; and
‘‘(v) the transaction is documented in a
journal maintained at the school clearly identi-
fying when the transaction occurred, what was
acquired and from whom, the price paid, the
quantities acquired, and any other information
the supervisor or school board considers rel-
evant.
‘‘(B) Not later than 6 months after the date of
the enactment of the No Child Left Behind Act of
2001, the Secretary shall cause to be sent to each
supervisor of a Bureau operated program and school
board chairperson, the education line officer or offi-
cers of each agency and area, and the Bureau Divi-
sion in charge of procurement, at both the local and
national levels, notice of this paragraph.
‘‘(C) The Director shall be responsible for de-
termining the application of this paragraph, includ-
ing the authorization of specific individuals to carry
out this paragraph, and shall be responsible for the
provision of guidelines on the use of this paragraph
and adequate training on such guidelines.
‘‘(4) EFFECT OF SEQUESTRATION ORDER.—If a
sequestration order issued under the Balanced
579
HR 1 PCS
Budget and Emergency Deficit Control Act of 1985
reduces the amount of funds available for allotment
under section 1127 for any fiscal year by more than
7 percent of the amount of funds available for allot-
ment under such section during the preceding fiscal
year—
‘‘(A) to fund allotments under section
1127, the Secretary, notwithstanding any other
law, may use—
‘‘(i) funds appropriated for the oper-
ation of any Bureau school that is closed
or consolidated; and
‘‘(ii) funds appropriated for any pro-
gram that has been curtailed at any Bu-
reau school; and
‘‘(B) the Secretary may waive the applica-
tion of the provisions of section 1121(h) with
respect to the closure or consolidation of a
school, or the curtailment of a program at a
school, during such fiscal year if the funds de-
scribed in clauses (i) and (ii) of subparagraph
(A) with respect to such school are used to fund
allotments made under section 1127 for such
fiscal year.
580
HR 1 PCS
‘‘(b) LOCAL FINANCIAL PLANS FOR EXPENDITURE
OF FUNDS.—
‘‘(1) PLAN REQUIRED.—In the case of all Bu-
reau operated schools, allotted funds shall be ex-
pended on the basis of local financial plans which
ensure meeting the accreditation requirements or
standards for the school established pursuant to sec-
tion 1121 and which shall be prepared by the local
school supervisor in active consultation with the local
school board for each school. The local school board
for each school shall have the authority to ratify, re-
ject, or amend such financial plan, and expenditures
thereunder, and, on its own determination or in re-
sponse to the supervisor of the school, to revise such
financial plan to meet needs not foreseen at the time
of preparation of the financial plan.
‘‘(2) The supervisor—
‘‘(A) shall put into effect the decisions of
the school board;
‘‘(B) shall provide the appropriate local
union representative of the education employees
with copies of proposed draft financial plans
and all amendments or modifications thereto, at
the same time such copies are submitted to the
local school board; and
581
HR 1 PCS
‘‘(C) may appeal any such action of the
local school board to the appropriate education
line officer of the Bureau agency by filing a
written statement describing the action and the
reasons the supervisor believes such action
should be overturned. A copy of such statement
shall be submitted to the local school board and
such board shall be afforded an opportunity to
respond, in writing, to such appeal. After re-
viewing such written appeal and response, the
appropriate education line officer may, for good
cause, overturn the action of the local school
board. The appropriate education line officer
shall transmit the determination of such appeal
in the form of a written opinion to such board
and to such supervisor identifying the reasons
for overturning such action.
‘‘(c) 
USE
OF
SELF-DETERMINATION
GRANTS
FUNDS.—Funds for self-determination grants under sec-
tion 103(a)(2) of the Indian Self-Determination and Edu-
cation Assistance Act shall not be used for providing tech-
nical assistance and training in the field of education by
the Bureau unless such services are provided in accord-
ance with a plan, agreed to by the tribe or tribes affected
and the Bureau, under which control of education pro-
582
HR 1 PCS
grams is intended to be transferred to such tribe or tribes
within a specific period of time negotiated under such
agreement. The Secretary may approve applications for
funding tribal divisions of education and development of
tribal codes of education from funds appropriated pursu-
ant to section 104(a) of such Act.
‘‘(d) TECHNICAL ASSISTANCE AND TRAINING.—In
the exercise of its authority under this section, a local
school board may request technical assistance and training
from the Secretary, and the Secretary shall, to the great-
est extent possible, provide such services, and make appro-
priate provisions in the budget of the Office for such serv-
ices.
‘‘(e) SUMMER PROGRAM OF ACADEMIC AND SUPPORT
SERVICES.—
‘‘(1) IN GENERAL.—A financial plan under sub-
section (b) for a school may include, at the discre-
tion of the local administrator and the school board
of such school, a provision for a summer program of
academic and support services for students of the
school. Any such program may include activities re-
lated to the prevention of alcohol and substance
abuse. The Assistant Secretary for Indian Affairs
shall provide for the utilization of any such school
583
HR 1 PCS
facility during any summer in which such utilization
is requested.
‘‘(2) USE OF OTHER FUNDS.—Notwithstanding
any other provision of law, funds authorized under
the Act of April 16, 1934, and this Act may be used
to augment the services provided in each summer
program at the option, and under the control, of the
tribe or Indian controlled school receiving such
funds.
‘‘(3) TECHNICAL
ASSISTANCE
AND
PROGRAM
COORDINATION.—The Assistant Secretary for Indian
Affairs, acting through the Director of the Office,
shall provide technical assistance and coordination
for any program described in paragraph (1) and
shall, to the extent possible, encourage the coordina-
tion of such programs with any other summer pro-
grams that might benefit Indian youth, regardless of
the funding source or administrative entity of any
such program.
‘‘(f) COOPERATIVE AGREEMENTS.—
‘‘(1) IN GENERAL.—From funds allotted to a
Bureau school under section 1127, the Secretary
shall, if specifically requested by the tribal governing
body (as defined in section 1141), implement any co-
operative agreement entered into between the tribe,
584
HR 1 PCS
the Bureau school board, and the local public school
district which meets the requirements of paragraph
(2) and involves the school. The tribe, the Bureau
school board, and the local public school district
shall determine the terms of the agreement. Such
agreement may encompass coordination of all or any
part of the following:
‘‘(A) Academic program and curriculum,
unless the Bureau school is currently accredited
by a State or regional accrediting entity and
would not continue to be so accredited.
‘‘(B) Support services, including procure-
ment and facilities maintenance.
‘‘(C) Transportation.
‘‘(2) EQUAL
BENEFIT
AND
BURDEN.—Each
agreement entered into pursuant to the authority
provided in paragraph (1) shall confer a benefit
upon the Bureau school commensurate with the bur-
den assumed, though this requirement shall not be
construed so as to require equal expenditures or an
exchange of similar services.
‘‘(g) 
PRODUCT
OR
RESULT
OF
STUDENT
PROJECTS.—Notwithstanding any other provision of law,
where there is agreement on action between the super-
intendent and the school board of a Bureau funded school,
585
HR 1 PCS
the product or result of a project conducted in whole or
in major part by a student may be given to that student
upon the completion of such project.
‘‘(h) NOT
CONSIDERED
FEDERAL
FUNDS
FOR
MATCHING REQUIREMENTS.—Notwithstanding any other
provision of law, funds received by a Bureau funded school
under this part shall not be considered Federal funds for
the purposes of meeting a matching funds requirement for
any Federal program.
‘‘SEC. 1131. POLICY FOR INDIAN CONTROL OF INDIAN EDU-
CATION.
‘‘(a) FACILITATION OF INDIAN CONTROL.—It shall
be the policy of the Secretary and the Bureau, in carrying
out the functions of the Bureau, to facilitate tribal control
of Indian affairs in all matters relating to education.
‘‘(b) CONSULTATION WITH TRIBES.—
‘‘(1) IN GENERAL.—All actions under this Act
shall be done with active consultation with tribes.
‘‘(2) REQUIREMENTS.—The consultation re-
quired under paragraph (1) means a process involv-
ing the open discussion and joint deliberation of all
options with respect to potential issues or changes
between the Bureau and all interested parties. Dur-
ing such discussions and joint deliberations, inter-
ested parties (including tribes and school officials)
586
HR 1 PCS
shall be given an opportunity to present issues in-
cluding proposals regarding changes in current prac-
tices or programs which will be considered for future
action by the Bureau. All interested parties shall be
given an opportunity to participate and discuss the
options presented or to present alternatives, with the
views and concerns of the interested parties given ef-
fect unless the Secretary determines, from informa-
tion available from or presented by the interested
parties during one or more of the discussions and
deliberations, that there is a substantial reason for
another course of action. The Secretary shall submit
to any Member of Congress, within 18 days of the
receipt of a written request by such Member, a writ-
ten explanation of any decision made by the Sec-
retary which is not consistent with the views of the
interested parties.
‘‘SEC. 1132. INDIAN EDUCATION PERSONNEL.
‘‘(a) IN GENERAL.—Chapter 51, subchapter III of
chapter 53, and chapter 63 of title 5, United States Code,
relating to classification, pay and leave, respectively, and
the sections of such title relating to the appointment, pro-
motion, hours of work, and removal of civil service employ-
ees, shall not apply to educators or to education positions
(as defined in subsection (p)).
587
HR 1 PCS
‘‘(b) REGULATIONS.—Not later than 60 days after
the date of the enactment of the No Child Left Behind
Act of 2001, the Secretary shall prescribe regulations to
carry out this section. Such regulations shall include—
‘‘(1) the establishment of education positions;
‘‘(2) the establishment of qualifications for edu-
cators and education personnel;
‘‘(3) the fixing of basic compensation for edu-
cators and education positions;
‘‘(4) the appointment of educators;
‘‘(5) the discharge of educators;
‘‘(6) the entitlement of educators to compensa-
tion;
‘‘(7) the payment of compensation to educators;
‘‘(8) the conditions of employment of educators;
‘‘(9) the leave system for educators;
‘‘(10) the annual leave and sick leave for edu-
cators; and
‘‘(11) such matters as may be appropriate.
‘‘(c) QUALIFICATIONS OF EDUCATORS.—
‘‘(1) REQUIREMENTS.—In prescribing regula-
tions to govern the qualifications of educators, the
Secretary shall require—
‘‘(A)(i) that lists of qualified and inter-
viewed applicants for education positions be
588
HR 1 PCS
maintained in each agency and area office of
the Bureau from among individuals who have
applied at the agency or area level for an edu-
cation position or who have applied at the na-
tional level and have indicated in such applica-
tion an interest in working in certain areas or
agencies; and
‘‘(ii) that a list of qualified and interviewed
applicants for education positions be main-
tained in the Office from among individuals
who have applied at the national level for an
education position and who have expressed in-
terest in working in an education position any-
where in the United States;
‘‘(B) that a local school board shall have
the authority to waive on a case-by-case basis,
any formal education or degree qualifications
established by regulation pursuant to subsection
(b)(2), in order for a tribal member to be hired
in an education position to teach courses on
tribal culture and language and that subject to
subsection (e)(2), a determination by a school
board that such a person be hired shall be insti-
tuted supervisor; and
589
HR 1 PCS
‘‘(C) that it shall not be a prerequisite to
the employment of an individual in an edu-
cation position at the local level that such indi-
vidual’s name appear on the national list main-
tained pursuant to subparagraph (A)(ii) or that
such individual has applied at the national level
for an education position.
‘‘(2) EXCEPTION FOR CERTAIN TEMPORARY EM-
PLOYMENT.—The Secretary may authorize the tem-
porary employment in an education position of an
individual who has not met the certification stand-
ards established pursuant to regulations, if the Sec-
retary determines that failure to do so would result
in that position remaining vacant.
‘‘(d) HIRING OF EDUCATORS.—
‘‘(1) REQUIREMENTS.—In prescribing regula-
tions to govern the appointment of educators, the
Secretary shall require—
‘‘(A)(i) that educators employed in a Bu-
reau operated school (other than the supervisor
of the school) shall be hired by the supervisor
of the school. In cases where there are no quali-
fied applicants available, such supervisor may
consult the national list maintained pursuant to
subsection (c)(1)(A)(ii);
590
HR 1 PCS
‘‘(ii) each school supervisor shall be hired
by the education line officer of the agency office
of the Bureau in which the school is located;
‘‘(iii) educators employed in an agency of-
fice of the Bureau shall be hired by the super-
intendent for education of the agency office;
and
‘‘(iv) each education line officer and edu-
cators employed in the Office of the Director of
Indian Education Programs shall be hired by
the Director;
‘‘(B) that before an individual is employed
in an education position in a school by the su-
pervisor of a school (or with respect to the posi-
tion of supervisor, by the appropriate agency
education line officer), the local school board
for the school shall be consulted. A determina-
tion by such school board that such individual
should or should not be so employed shall be in-
stituted by the supervisor (or with respect to
the position of supervisor, by the agency super-
intendent for education);
‘‘(C) that before an individual may be em-
ployed in an education position at the agency
level, the appropriate agency school board shall
591
HR 1 PCS
be consulted, and that a determination by such
school board that such individual should or
should not be employed shall be instituted by
the agency superintendent for education; and
‘‘(D) that before an individual may be em-
ployed in an education position in the Office of
the Director (other than the position of Direc-
tor), the national school boards representing all
Bureau schools shall be consulted.
‘‘(2) INFORMATION
REGARDING
APPLICATION
AT NATIONAL LEVEL.—Any individual who applies
at the local level for an education position shall state
on such individual’s application whether or not such
individual has applied at the national level for an
education position in the Bureau. If such individual
is employed at the local level, such individual’s name
shall be immediately forwarded to the Secretary,
who shall, as soon as practicable but in no event in
more than 30 days, ascertain the accuracy of the
statement made by such individual pursuant to the
first sentence of this paragraph. Notwithstanding
subsection (e), if the individual’s statement is found
to have been false, such individual, at the Sec-
retary’s discretion, may be disciplined or discharged.
If the individual has applied at the national level for
592
HR 1 PCS
an education position in the Bureau, the appoint-
ment of such individual at the local level shall be
conditional for a period of 90 days, during which pe-
riod the Secretary may appoint a more qualified in-
dividual (as determined by the Secretary) from the
list maintained at the national level pursuant to sub-
section (c)(1)(A)(ii) to the position to which such in-
dividual was appointed.
‘‘(3) STATUTORY
CONSTRUCTION.—Except as
expressly provided, nothing in this section shall be
construed as conferring upon local school boards au-
thority over, or control of, educators at Bureau
funded schools or the authority to issue management
decisions.
‘‘(e) DISCHARGE AND CONDITIONS OF EMPLOYMENT
OF EDUCATORS.—
‘‘(1) REGULATIONS.—In prescribing regulations
to govern the discharge and conditions of employ-
ment of educators, the Secretary shall require—
‘‘(A) that procedures be established for the
rapid and equitable resolution of grievances of
educators;
‘‘(B) that no educator may be discharged
without notice of the reasons therefore and op-
portunity for a hearing under procedures that
593
HR 1 PCS
comport with the requirements of due process;
and
‘‘(C) that educators employed in Bureau
schools be notified 30 days prior to the end of
the school year whether their employment con-
tract will be renewed for the following year.
‘‘(2) PROCEDURES FOR DISCHARGE.—The su-
pervisor of a Bureau school may discharge (subject
to procedures established under paragraph (1)(B))
for cause (as determined under regulations pre-
scribed by the Secretary) any educator employed in
such school. Upon giving notice of proposed dis-
charge to an educator, the supervisor involved shall
immediately notify the local school board for the
school of such action. A determination by the local
school board that such educator shall not be dis-
charged shall be followed by the supervisor. The su-
pervisor shall have the right to appeal such action
to the education line officer of the appropriate agen-
cy office of the Bureau. Upon such an appeal, the
agency education line officer may, for good cause
and in writing to the local school board, overturn the
determination of the local school board with respect
to the employment of such individual.
594
HR 1 PCS
‘‘(3) RECOMMENDATIONS OF SCHOOL BOARDS
FOR DISCHARGE.—Each local school board for a Bu-
reau school shall have the right—
‘‘(A) to recommend to the supervisor of
such school that an educator employed in the
school be discharged; and
‘‘(B) to recommend to the education line
officer of the appropriate agency office of the
Bureau and to the Director of the Office, that
the supervisor of the school be discharged.
‘‘(f) 
APPLICABILITY
OF
INDIAN
PREFERENCE
LAWS.—
‘‘(1) IN GENERAL.—Notwithstanding any provi-
sion of the Indian preference laws, such laws shall
not apply in the case of any personnel action under
this section respecting an applicant or employee not
entitled to Indian preference if each tribal organiza-
tion concerned grants a written waiver of the appli-
cation of such laws with respect to such personnel
action and states that such waiver is necessary. This
paragraph shall not relieve the Bureau’s responsi-
bility to issue timely and adequate announcements
and advertisements concerning any such personnel
action if such action is intended to fill a vacancy (no
matter how such vacancy is created).
595
HR 1 PCS
‘‘(2) TRIBAL
ORGANIZATION
DEFINED.—For
purposes of this subsection, the term ‘tribal organi-
zation’ means—
‘‘(A) the recognized governing body of any
Indian tribe, band, nation, pueblo, or other or-
ganized community, including a Native village
(as defined in section 3(c) of the Alaska Native
Claims Settlement Act); or
‘‘(B) in connection with any personnel ac-
tion referred to in this subsection, any local
school board as defined in section 1141 which
has been delegated by such governing body the
authority to grant a waiver under this sub-
section with respect to personnel action.
‘‘(3) INDIAN PREFERENCE LAW DEFINED.—The
term ‘Indian preference laws’ means section 12 of
the Act of June 18, 1934, or any other provision of
law granting a preference to Indians in promotions
and other personnel actions. Such term shall not in-
clude section 7(b) of the Indian Self-Determination
and Education Assistance Act.
‘‘(g) COMPENSATION OR ANNUAL SALARY.—
‘‘(1) IN
GENERAL.—(A) Except as otherwise
provided in this section, the Secretary shall fix the
basic compensation for educators and education po-
596
HR 1 PCS
sitions at rates in effect under the General Schedule
for individuals with comparable qualifications, and
holding comparable positions, to whom chapter 51 of
title 5, United States Code, is applicable or on the
basis of the Federal Wage System schedule in effect
for the locality, and for the comparable positions,
the rates of compensation in effect for the senior ex-
ecutive service.
‘‘(B) The Secretary shall establish the rate of
basic compensation, or annual salary rates, for the
positions of teachers and counselors (including dor-
mitory counselors and home-living counselors) at the
rates of basic compensation applicable (on the date
of the enactment of the No Child Left Behind Act
of 2001 and thereafter) to comparable positions in
the overseas schools under the Defense Department
Overseas Teachers Pay Act. The Secretary shall
allow the local school boards authority to implement
only the aspects of the Defense Department Over-
seas Teacher pay provisions that are considered es-
sential for recruitment and retention. Implementa-
tion of such provisions shall not be construed to re-
quire the implementation of the Act in its entirety.
‘‘(C)(i) Beginning with the fiscal year following
the date of the enactment of the No Child Left Be-
597
HR 1 PCS
hind Act of 2001, each school board may set the
rate of compensation or annual salary rate for teach-
ers and counselors (including academic counselors)
who are new hires at the school and who have not
worked at the school on the date of implementation
of this provision, at rates consistent with the rates
paid for individuals in the same positions, with the
same tenure and training, in any other school within
whose boundaries the Bureau school lies. In in-
stances where the adoption of such rates cause a re-
duction in the payment of compensation from that
which was in effect for the fiscal year following the
date of the enactment of the No Child Left Behind
Act of 2001, the new rate may be applied to the
compensation of employees of the school who worked
at the school on of the date of the enactment of that
Act by applying those rates to each contract renewal
such that the reduction takes effect in three equal
installments. Where adoption of such rates lead to
an increase in the payment of compensation from
that which was in effect for the fiscal year following
the date of the enactment of the No Child Left Be-
hind Act of 2001, the school board may make such
rates applicable at the next contract renewal such
that either—
598
HR 1 PCS
‘‘(I) the increase occurs in its entirety; or
‘‘(II) the increase is applied in three equal
installments.
‘‘(ii) The establishment of rates of basic com-
pensation and annual salary rates under subpara-
graphs (B) and (C) shall not preclude the use of
regulations and procedures used by the Bureau prior
to April 28, 1988, in making determinations regard-
ing promotions and advancements through levels of
pay that are based on the merit, education, experi-
ence, or tenure of the educator.
‘‘(D) The establishment of rates of basic com-
pensation and annual salary rates under subpara-
graphs (B) and (C) shall not affect the continued
employment or compensation of an educator who
was employed in an education position on October
31, 1979, and who did not make an election under
subsection (p) is in effect on January 1, 1990.
‘‘(2) POST-DIFFERENTIAL
RATES.—(A) The
Secretary may pay a post-differential rate not to ex-
ceed 25 percent of the rate of basic compensation,
on the basis of conditions of environment or work
which warrant additional pay as a recruitment and
retention incentive.
599
HR 1 PCS
‘‘(B)(i) Upon the request of the supervisor and
the local school board of a Bureau school, the Sec-
retary shall grant the supervisor of the school au-
thorization to provide one or more post-differentials
under subparagraph (A) unless the Secretary deter-
mines for clear and convincing reasons (and advises
the board in writing of those reasons) that certain
of the requested post-differentials should be dis-
approved or decreased because there is no disparity
of compensation for the involved employees or posi-
tions in the Bureau school, as compared with the
nearest public school, that is either—
‘‘(I) at least 5 percent; or
‘‘(II) less than 5 percent and affects the
recruitment or retention of employees at the
school.
‘‘(ii) A request under clause (i) shall be deemed
granted at the end of the 60th day after the request
is received in the Central Office of the Bureau un-
less before that time the request is approved, ap-
proved with modification, or disapproved by the Sec-
retary.
‘‘(iii) The Secretary or the supervisor of a Bu-
reau school may discontinue or decrease a post-dif-
600
HR 1 PCS
ferential authorized under this subparagraph at the
beginning of a school year if—
‘‘(I) the local school board requests that
such differential be discontinued or decreased;
or
‘‘(II) the Secretary or the supervisor deter-
mines for clear and convincing reasons (and ad-
vises the board in writing of those reasons) that
there is no disparity of compensation that
would affect the recruitment or retention of em-
ployees at the school after the differential is
discontinued or decreased.
‘‘(iv) On or before February 1 of each year, the
Secretary shall submit to Congress a report describ-
ing the requests and grants of authority under this
subparagraph during the previous year and listing
the positions contracted under those grants of au-
thority.
‘‘(h) LIQUIDATION
OF REMAINING LEAVE UPON
TERMINATION.—Upon termination of employment with
the Bureau, any annual leave remaining to the credit of
an individual within the purview of this section shall be
liquidated in accordance with sections 5551(a) and 6306
of title 5, United States Code, except that leave earned
601
HR 1 PCS
or accrued under regulations prescribed pursuant to sub-
section (b)(10) of this section shall not be so liquidated.
‘‘(i) TRANSFER OF REMAINING SICK LEAVE UPON
TRANSFER, PROMOTION, OR REEMPLOYMENT.—In the
case of any educator who is transferred, promoted, or re-
appointed, without break in service, to a position in the
Federal Government under a different leave system, any
remaining leave to the credit of such person earned or
credited under the regulations prescribed pursuant to sub-
section (b)(10) shall be transferred to such person’s credit
in the employing agency on an adjusted basis in accord-
ance with regulations which shall be prescribed by the Of-
fice of Personnel Management.
‘‘(j) INELIGIBILITY FOR EMPLOYMENT OF VOLUN-
TARILY TERMINATED EDUCATORS.—An educator who vol-
untarily terminates employment with the Bureau before
the expiration of the existing employment contract be-
tween such educator and the Bureau shall not be eligible
to be employed in another education position in the Bu-
reau during the remainder of the term of such contract.
‘‘(k) DUAL COMPENSATION.—In the case of any edu-
cator employed in an education position described in sub-
section (l)(1)(A) who—
‘‘(1) is employed at the close of a school year;
602
HR 1 PCS
‘‘(2) agrees in writing to serve in such position
for the next school year; and
‘‘(3) is employed in another position during the
recess period immediately preceding such next school
year, or during such recess period receives additional
compensation referred to in section 5533 of title 5,
United States Code, relating to dual compensation,
shall not apply to such educator by reason of any such
employment during a recess period for any receipt of addi-
tional compensation.
‘‘(l) VOLUNTARY SERVICES.—Notwithstanding sec-
tion 1342 of title 31, United States Code, the Secretary
may, subject to the approval of the local school board con-
cerned, accept voluntary services on behalf of Bureau
schools. Nothing in this part shall be construed to require
Federal employees to work without compensation or to
allow the use of volunteer services to displace or replace
Federal employees. An individual providing volunteer serv-
ices under this section is a Federal employee only for pur-
poses of chapter 81 of title 5, United States Code, and
chapter 171 of title 28, United States Code.
‘‘(m) PRORATION OF PAY.—
‘‘(1) 
ELECTION
OF
EMPLOYEE.—Notwith-
standing any other provision of law, including laws
relating to dual compensation, the Secretary, at the
603
HR 1 PCS
election of the employee, shall prorate the salary of
an employee employed in an education position for
the academic school year over the entire 12-month
period. Each educator employed for the academic
school year shall annually elect to be paid on a 12-
month basis or for those months while school is in
session. No educator shall suffer a loss of pay or
benefits, including benefits under unemployment or
other Federal or federally assisted programs, be-
cause of such election.
‘‘(2) CHANGE
OF
ELECTION.—During the
course of such year the employee may change elec-
tion once.
‘‘(3) LUMP
SUM
PAYMENT.—That portion of
the employee’s pay which would be paid between
academic school years may be paid in a lump sum
at the election of the employee.
‘‘(4) DEFINITIONS.—For purposes of this sub-
section, the terms ‘educator’ and ‘education position’
have the meanings contained in paragraphs (1) and
(2) of subsection (o). This subsection applies to
those individuals employed under the provisions of
section 1132 of this title or title 5, United States
Code.
‘‘(n) EXTRACURRICULAR ACTIVITIES.—
604
HR 1 PCS
‘‘(1) STIPEND.—Notwithstanding any other
provision of law, the Secretary may provide, for each
Bureau area, a stipend in lieu of overtime premium
pay or compensatory time off. Any employee of the
Bureau who performs additional activities to provide
services to students or otherwise support the school’s
academic and social programs may elect to be com-
pensated for all such work on the basis of the sti-
pend. Such stipend shall be paid as a supplement to
the employee’s base pay.
‘‘(2) ELECTION NOT TO RECEIVE STIPEND.—If
an employee elects not to be compensated through
the stipend established by this subsection, the appro-
priate provisions of title 5, United States Code, shall
apply.
‘‘(3) APPLICABILITY
OF
SUBSECTION.—This
subsection applies to all Bureau employees, whether
employed under section 1132 of this title or title 5,
United States Code.
‘‘(o) DEFINITIONS.—For the purpose of this
section—
‘‘(1) EDUCATION
POSITION.—The term ‘edu-
cation position’ means a position in the Bureau the
duties and responsibilities of which—
605
HR 1 PCS
‘‘(A) are performed on a school-year basis
principally in a Bureau school and involve—
‘‘(i) classroom or other instruction or
the supervision or direction of classroom or
other instruction;
‘‘(ii) any activity (other than teach-
ing) which requires academic credits in
educational theory and practice equal to
the academic credits in educational theory
and practice required for a bachelor’s de-
gree in education from an accredited insti-
tution of higher education;
‘‘(iii) any activity in or related to the
field of education notwithstanding that
academic credits in educational theory and
practice are not a formal requirement for
the conduct of such activity; or
‘‘(iv) support services at, or associated
with, the site of the school; or
‘‘(B) are performed at the agency level of
the Bureau and involve the implementation of
education-related programs other than the posi-
tion for agency superintendent for education.
606
HR 1 PCS
‘‘(2) EDUCATOR.—The term ‘educator’ means
an individual whose services are required, or who is
employed, in an education position.
‘‘(p) COVERED INDIVIDUALS; ELECTION.—This sec-
tion shall apply with respect to any educator hired after
November 1, 1979 (and to any educator who elected for
coverage under that provision after November 1, 1979)
and to the position in which such individual is employed.
The enactment of this section shall not affect the contin-
ued employment of an individual employed on October 31,
1979 in an education position, or such person’s right to
receive the compensation attached to such position.
‘‘SEC. 1133. COMPUTERIZED MANAGEMENT INFORMATION
SYSTEM.
‘‘(a) ESTABLISHMENT OF SYSTEM.—Not later than
July 1, 2003, the Secretary shall establish within the Of-
fice, a computerized management information system,
which shall provide processing and information to the Of-
fice. The information provided shall include information
regarding—
‘‘(1) student enrollment;
‘‘(2) curriculum;
‘‘(3) staffing;
‘‘(4) facilities;
‘‘(5) community demographics;
607
HR 1 PCS
‘‘(6) student assessment information;
‘‘(7) information on the administrative and pro-
gram costs attributable to each Bureau program, di-
vided into discreet elements;
‘‘(8) relevant reports;
‘‘(9) personnel records;
‘‘(10) finance and payroll; and
‘‘(11) such other items as the Secretary deems
appropriate.
‘‘(b) IMPLEMENTATION OF SYSTEM.—Not later than
July 1, 2004, the Secretary shall complete implementation
of such a system at each field office and Bureau funded
school.
‘‘SEC. 1134. UNIFORM EDUCATION PROCEDURES AND PRAC-
TICES.
‘‘The Secretary shall cause the various divisions of
the Bureau to formulate uniform procedures and practices
with respect to such concerns of those divisions as relate
to education, and shall report such practices and proce-
dures to the Congress.
‘‘SEC. 1135. RECRUITMENT OF INDIAN EDUCATORS.
‘‘The Secretary shall institute a policy for the recruit-
ment of qualified Indian educators and a detailed plan to
promote employees from within the Bureau. Such plan
608
HR 1 PCS
shall include opportunities for acquiring work experience
prior to actual work assignment.
‘‘SEC. 1136. BIENNIAL REPORT; AUDITS.
‘‘(a) BIENNIAL REPORTS.—The Secretary shall sub-
mit to each appropriate committee of Congress, all Bureau
funded schools, and the tribal governing bodies of such
schools, a detailed biennial report on the state of education
within the Bureau and any problems encountered in In-
dian education during the 2-year period covered by the
report. Such report shall contain suggestions for the im-
provement of the Bureau educational system and for in-
creasing tribal or local Indian control of such system. Such
report shall also include the current status of tribally con-
trolled community colleges. The annual budget submission
for the Bureau’s education programs shall include—
‘‘(1) information on the funds provided to pre-
viously private schools under section 208 of the In-
dian Self-Determination and Education Assistance
Act, and recommendations with respect to the future
use of such funds;
‘‘(2) the needs and costs of operations and
maintenance of tribally controlled community col-
leges eligible for assistance under the Tribally Con-
trolled Community College Assistance Act of 1978
609
HR 1 PCS
and recommendations with respect to meeting such
needs and costs; and
‘‘(3) the plans required by sections 1121 (g),
1122(c), and 1125(b).
‘‘(b) FINANCIAL
AND COMPLIANCE AUDITS.—The
Inspector General of the Department of the Interior shall
establish a system to ensure that financial and compliance
audits are conducted of each Bureau operated school at
least once in every 3 years. Audits of Bureau schools shall
be based upon the extent to which such school has com-
plied with its local financial plan under section 1130.
‘‘SEC. 1137. RIGHTS OF INDIAN STUDENTS.
‘‘The Secretary shall prescribe such rules and regula-
tions as are necessary to ensure the constitutional and civil
rights of Indian students attending Bureau funded
schools, including such students’ right to privacy under
the laws of the United States, such students’ right to free-
dom of religion and expression, and such students’ right
to due process in connection with disciplinary actions, sus-
pensions, and expulsions.
‘‘SEC. 1138. REGULATIONS.
‘‘(a) IN GENERAL.—The Secretary is authorized to
issue only such regulations as are necessary to ensure
compliance with the specific provision of this Act. The Sec-
retary shall publish proposed regulations in the Federal
610
HR 1 PCS
Register, shall provide a period of not less than 90 days
for public comment thereon, and shall place in parentheses
after each regulatory section the citation to any statutory
provision providing authority to promulgate such regu-
latory provision.
‘‘(b) MISCELLANEOUS.—
‘‘(1) CONSTRUCTION.—The provisions of this
Act shall supersede any conflicting provisions of law
(including any conflicting regulations) in effect on
the day before the date of the enactment of this Act
and the Secretary is authorized to repeal any regula-
tion inconsistent with the provisions of this Act.
‘‘(2) LEGAL AUTHORITY TO BE STATED.—Reg-
ulations issued to implement this Act shall contain,
immediately following each substantive provision of
such regulations, citations to the particular section
or sections of statutory law or other legal authority
upon which provision is based.
‘‘SEC. 1138A. REGIONAL MEETINGS AND NEGOTIATED
RULEMAKING.
‘‘(a) MEETINGS.—
‘‘(1) IN GENERAL.—The Secretary shall obtain
tribal involvement in the development of proposed
regulations under this part and the Tribally Con-
trolled Schools Act of 1988. The Secretary shall ob-
611
HR 1 PCS
tain the advice of and recommendations from rep-
resentatives of Indian tribes with Bureau funded
schools on their reservations, Indian tribes whose
children attend Bureau funded off-reservation board-
ing schools, school boards, administrators or employ-
ees of Bureau funded schools, and parents and
teachers of students enrolled in Bureau funded
schools.
‘‘(2) ISSUES.—The Secretary shall provide for a
comprehensive discussion and exchange of informa-
tion concerning the implementation of this part and
the Tribally Controlled Schools Act of 1988 through
such mechanisms as regional meetings and electronic
exchanges of information. The Secretary shall take
into account the information received through such
mechanisms in the development of proposed regula-
tions and shall publish a summary of such informa-
tion in the Federal Register together with such pro-
posed regulations.
‘‘(b) DRAFT REGULATIONS.—
‘‘(1) IN GENERAL.—After obtaining the advice
and recommendations described in subsection (a)(1)
and before publishing proposed regulations in the
Federal Register, the Secretary shall prepare draft
regulations implementing this part and the Tribally
612
HR 1 PCS
Controlled Schools Act of 1988 and shall submit
such regulations to a negotiated rulemaking process.
Participants in the negotiations process shall be cho-
sen by the Secretary from individuals nominated by
the entities described in subsection (a)(1). To the
maximum extent possible, the Secretary shall ensure
that the tribal representative membership chosen
pursuant to the preceding sentence reflects the pro-
portionate share of students from tribes served by
the Bureau funded school system. The negotiation
process shall be conducted in a timely manner in
order that the final regulations may issued by the
Secretary no later than 18 months after the enact-
ment of this section.
‘‘(2) NOTIFICATION
TO
CONGRESS.—If draft
regulations implementing this part and the Tribally
Controlled Schools Act of 1988 are not issued in
final form by the deadline provided in paragraph
(1), the Secretary shall notify the appropriate com-
mittees of Congress of which draft regulations were
not issued in final form by the deadline and the rea-
son such final regulations were not issued.
‘‘(3) 
EXPANSION
OF
NEGOTIATED
RULE-
MAKING.—All regulations pertaining to this part and
the Tribally Controlled Schools Act of 1988 that are
613
HR 1 PCS
promulgated after the date of the enactment of this
subsection shall be subject to a negotiated rule-
making (including the selection of the regulations to
be negotiated), unless the Secretary determines that
applying such a requirement with respect to given
regulations is impracticable, unnecessary, or con-
trary to the public interest (within the meaning of
section 553(b)(3)(B) of title 5), and publishes the
basis for such determination in the Federal Register
at the same time as the proposed regulations in
question are first published. All published proposed
regulations shall conform to agreements resulting
from such negotiated rulemaking unless the Sec-
retary reopens the negotiated rulemaking process or
provides a written explanation to the participants in
that process why the Secretary has decided to depart
from such agreements. Such negotiated rulemaking
shall be conducted in accordance with the provisions
of subsection (a), and the Secretary shall ensure
that a clear and reliable record of agreements
reached during the negotiation process is main-
tained.
‘‘(c) APPLICABILITY OF FEDERAL ADVISORY COM-
MITTEE ACT.—The Federal Advisory Committee Act shall
apply to activities carried out under this section.
614
HR 1 PCS
‘‘SEC. 1139. EARLY CHILDHOOD DEVELOPMENT PROGRAM.
‘‘(a) IN GENERAL.—The Secretary shall provide
grants to tribes, tribal organizations, and consortia of
tribes and tribal organizations to fund early childhood de-
velopment programs that are operated by such tribes, or-
ganizations, or consortia.
‘‘(b) AMOUNT OF GRANTS.—
‘‘(1) IN GENERAL.—The total amount of the
grants provided under subsection (a) with respect to
each tribe, tribal organization, or consortium of
tribes or tribal organizations for each fiscal year
shall be equal to the amount which bears the same
relationship to the total amount appropriated under
the authority of subsection (g) for such fiscal year
(less amounts provided under subsection (f)) as—
‘‘(A) the total number of children under 6
years of age who are members of—
‘‘(i) such tribe;
‘‘(ii) the tribe that authorized such
tribal organization; or
‘‘(iii) any tribe that—
‘‘(I) is a member of such consor-
tium; or
‘‘(II) authorizes any tribal orga-
nization that is a member of such con-
sortium; bears to
615
HR 1 PCS
‘‘(B) the total number of all children under
6 years of age who are members of any tribe
that—
‘‘(i) is eligible to receive funds under
subsection (a);
‘‘(ii) is a member of a consortium that
is eligible to receive such funds; or
‘‘(iii) authorizes a tribal organization
that is eligible to receive such funds.
‘‘(2) LIMITATION.—No grant may be provided
under subsection (a)—
‘‘(A) to any tribe that has less than 500
members;
‘‘(B) to any tribal organization which is
authorized—
‘‘(i) by only one tribe that has less
than 500 members; or
‘‘(ii) by one or more tribes that have
a combined total membership of less than
500 members; or
‘‘(C) to any consortium composed of tribes,
or tribal organizations authorized by tribes,
that have a combined total tribal membership of
less than 500 members.
‘‘(c) APPLICATION.—
616
HR 1 PCS
‘‘(1) IN GENERAL.—A grant may be provided
under subsection (a) to a tribe, tribal organization,
or consortia of tribes and tribal organizations only
if the tribe, organization, or consortia submits to the
Secretary an application for the grant at such time
and in such form as the Secretary shall prescribe.
‘‘(2) CONTENTS.—Applications submitted under
paragraph (1) shall set forth the early childhood de-
velopment program that the applicant desires to op-
erate.
‘‘(d) REQUIREMENT OF PROGRAMS FUNDED.—The
early childhood development programs that are funded by
grants provided under subsection (a)—
‘‘(1) shall coordinate existing programs and
may provide services that meet identified needs of
parents and children under 6 years of age which are
not being met by existing programs, including—
‘‘(A) prenatal care;
‘‘(B) nutrition education;
‘‘(C) health education and screening;
‘‘(D) family literacy services;
‘‘(E) educational testing; and
‘‘(F) other educational services;
‘‘(2) may include instruction in the language,
art, and culture of the tribe; and
617
HR 1 PCS
‘‘(3) shall provide for periodic assessment of the
program.
‘‘(e) COORDINATION
OF FAMILY LITERACY PRO-
GRAMS.—Family literacy programs operated under this
section and other family literacy programs operated by the
Bureau of Indian Affairs shall be coordinated with family
literacy programs for Indian children under part B of title
I of the Elementary and Secondary Education Act of 1965
in order to avoid duplication and to encourage the dissemi-
nation of information on quality family literacy programs
serving Indians.
‘‘(f) ADMINISTRATIVE COSTS.—The Secretary shall,
out of funds appropriated under subsection (g), include
in the grants provided under subsection (a) amounts for
administrative costs incurred by the tribe, tribal organiza-
tion, or consortium of tribes in establishing and maintain-
ing the early childhood development program.
‘‘(g) AUTHORIZATION OF APPROPRIATIONS.—For the
purpose of carrying out the provisions of this section,
there are authorized to be appropriated $10,000,000 for
fiscal year 2002 and such sums as may be necessary for
each of the fiscal years 2003, 2004, 2005, and 2006.
618
HR 1 PCS
‘‘SEC. 1140. TRIBAL DEPARTMENTS OR DIVISIONS OF EDU-
CATION.
‘‘(a) IN GENERAL.—Subject to the availability of ap-
propriations, the Secretary shall provide grants and tech-
nical assistance to tribes for the development and oper-
ation of tribal departments of education for the purpose
of planning and coordinating all educational programs of
the tribe.
‘‘(b) GRANTS.—Grants provided under this section
shall—
‘‘(1) be based on applications from the gov-
erning body of the tribe;
‘‘(2) reflect factors such as geographic and pop-
ulation diversity;
‘‘(3) facilitate tribal control in all matters relat-
ing to the education of Indian children on Indian
reservations (and on former Indian reservations in
Oklahoma);
‘‘(4) provide for the development of coordinated
educational programs on Indian reservations (and on
former Indian reservations in Oklahoma) (including
all preschool, elementary, secondary, and higher or
vocational educational programs funded by tribal,
Federal, or other sources) by encouraging tribal ad-
ministrative support of all Bureau funded edu-
cational programs as well as encouraging tribal co-
619
HR 1 PCS
operation and coordination with all educational pro-
grams receiving financial support from State agen-
cies, other Federal agencies, or private entities;
‘‘(5) provide for the development and enforce-
ment of tribal educational codes, including tribal
educational policies and tribal standards applicable
to curriculum, personnel, students, facilities, and
support programs; and
‘‘(6) otherwise comply with regulations for
grants under section 103(a) of the Indian Self-De-
termination and Educational Assistance Act that are
in effect on the date that application for such grants
are made.
‘‘(c) PRIORITIES.—
‘‘(1) IN
GENERAL.—In making grants under
this section, the Secretary shall give priority to any
application that—
‘‘(A) includes assurances from the majority
of Bureau funded schools located within the
boundaries of the reservation of the applicant
that the tribal department of education to be
funded under this section will provide coordi-
nating services and technical assistance to all of
such schools, including the submission to each
applicable agency of a unified application for
620
HR 1 PCS
funding for all of such schools which provides
that—
‘‘(i) no administrative costs other
than those attributable to the individual
programs of such schools will be associated
with the unified application; and
‘‘(ii) the distribution of all funds re-
ceived under the unified application will be
equal to the amount of funds provided by
the applicable agency to which each of
such schools is entitled under law;
‘‘(B) includes assurances from the tribal
governing body that the tribal department of
education funded under this section will admin-
ister all contracts or grants (except those cov-
ered by the other provisions of this title and the
Tribally Controlled Community College Assist-
ance Act of 1978) for education programs ad-
ministered by the tribe and will coordinate all
of the programs to the greatest extent possible;
‘‘(C) includes assurances for the moni-
toring and auditing by or through the tribal de-
partment of education of all education pro-
grams for which funds are provided by contract
621
HR 1 PCS
or grant to ensure that the programs meet the
requirements of law; and
‘‘(D) provides a plan and schedule for—
‘‘(i) the assumption over the term of
the grant by the tribal department of edu-
cation of all assets and functions of the
Bureau agency office associated with the
tribe, insofar as those responsibilities re-
late to education; and
‘‘(ii) the termination by the Bureau of
such operations and office at the time of
such assumption,
except that when mutually agreeable between
the tribal governing body and the Assistant
Secretary, the period in which such assumption
is to occur may be modified, reduced, or ex-
tended after the initial year of the grant.
‘‘(2) TIME PERIOD OF GRANT.—Subject to the
availability of appropriated funds, grants provided
under this section shall be provided for a period of
3 years and the grant may, if performance by the
grantee is satisfactory to the Secretary, be renewed
for additional 3-year terms.
‘‘(d) TERMS, CONDITIONS, OR REQUIREMENTS.—The
Secretary shall not impose any terms, conditions, or re-
622
HR 1 PCS
quirements on the provision of grants under this section
that are not specified in this section.
‘‘(e) AUTHORIZATION OF APPROPRIATIONS.—For the
purpose of carrying out the provisions of this section,
there are authorized to be appropriated $2,000,000 for fis-
cal year 2002 and such sums as may be necessary for each
of the fiscal years 2003, 2004, 2005, and 2006.
‘‘SEC. 1141. DEFINITIONS.
‘‘For the purposes of this part, unless otherwise spec-
ified:
‘‘(1) AGENCY
SCHOOL
BOARD.—The term
‘agency school board’ means a body, the members of
which are appointed by all of the school boards of
the schools located within an agency, including
schools operated under contract or grant, and the
number of such members shall be determined by the
Secretary in consultation with the affected tribes, ex-
cept that, in agencies serving a single school, the
school board of such school shall fulfill these duties,
and in agencies having schools or a school operated
under contract or grant, one such member at least
shall be from such a school.
‘‘(2) BUREAU.—The term ‘Bureau’ means the
Bureau of Indian Affairs of the Department of the
Interior.
623
HR 1 PCS
‘‘(3) BUREAU
FUNDED
SCHOOL.—The term
‘Bureau funded school’ means—
‘‘(A) a Bureau school;
‘‘(B) a contract or grant school; or
‘‘(C) a school for which assistance is pro-
vided under the Tribally Controlled Schools Act
of 1988.
‘‘(4) BUREAU
SCHOOL.—The term ‘Bureau
school’ means a Bureau operated elementary or sec-
ondary day or boarding school or a Bureau operated
dormitory for students attending a school other than
a Bureau school.
‘‘(5) CONTRACT OR GRANT SCHOOL.—The term
‘contract or grant school’ means an elementary or
secondary school or dormitory which receives finan-
cial assistance for its operation under a contract,
grant or agreement with the Bureau under section
102, 103(a), or 208 of the Indian Self-Determina-
tion and Education Assistance Act, or under the
Tribally Controlled Schools Act of 1988.
‘‘(6) EDUCATION
LINE
OFFICER.—The term
‘education line officer’ means education personnel
under the supervision of the Director, whether lo-
cated in the central, area, or agency offices.
624
HR 1 PCS
‘‘(7) FAMILY LITERACY SERVICES.—The term
‘family literacy services’ has the meaning given that
term in section 8101 of the Elementary and Sec-
ondary Education Act of 1965 (20 U.S.C. 8801).
‘‘(8) FINANCIAL
PLAN.—The term ‘financial
plan’ means a plan of services provided by each Bu-
reau school.
‘‘(9) INDIAN ORGANIZATION.—the term ‘Indian
organization’ means any group, association, partner-
ship, corporation, or other legal entity owned or con-
trolled by a federally recognized Indian tribe or
tribes, or a majority of whose members are members
of federally recognized tribes.
‘‘(10) LOCAL
EDUCATIONAL
AGENCY.—The
term ‘local educational agency’ means a board of
education or other legally constituted local school
authority having administrative control and direction
of free public education in a county, township, inde-
pendent, or other school district located within a
State, and includes any State agency which directly
operates and maintains facilities for providing free
public education.
‘‘(11) LOCAL SCHOOL BOARD.—The term ‘local
school board’, when used with respect to a Bureau
school, means a body chosen in accordance with the
625
HR 1 PCS
laws of the tribe to be served or, in the absence of
such laws, elected by the parents of the Indian chil-
dren attending the school, except that in schools
serving a substantial number of students from dif-
ferent tribes, the members shall be appointed by the
governing bodies of the tribes affected, and the num-
ber of such members shall be determined by the Sec-
retary in consultation with the affected tribes.
‘‘(12) OFFICE.—The term ‘Office’ means the
Office of Indian Education Programs within the Bu-
reau.
‘‘(13) 
SECRETARY.—The 
term 
‘Secretary’
means the Secretary of the Interior.
‘‘(14) SUPERVISOR.—The term ‘supervisor’
means the individual in the position of ultimate au-
thority at a Bureau school.
‘‘(15) TRIBAL
GOVERNING
BODY.—The term
‘tribal governing body’ means, with respect to any
school, the tribal governing body, or tribal governing
bodies, that represent at least 90 percent of the stu-
dents served by such school.
‘‘(16) TRIBE.—The term ‘tribe’ means any In-
dian tribe, band, nation, or other organized group or
community, including any Alaska Native village or
regional or village corporation as defined in or estab-
626
HR 1 PCS
lished pursuant to the Alaska Native Claims Settle-
ment Act, which is recognized as eligible for the spe-
cial programs and services provided by the United
States to Indians because of their status as Indi-
ans.’’.
SEC. 314. TRIBALLY CONTROLLED SCHOOLS ACT OF 1988.
Sections 5202 through 5212 of the Tribally Con-
trolled Schools Act of 1988 (25 U.S.C. 2501 et seq.) are
amended to read as follows:
‘‘SEC. 5202. FINDINGS.
‘‘Congress, after careful review of the Federal Gov-
ernment’s historical and special legal relationship with,
and resulting responsibilities to, Indians, finds that—
‘‘(1) the Indian Self-Determination and Edu-
cation Assistance Act, which was a product of the le-
gitimate aspirations and a recognition of the inher-
ent authority of Indian nations, was and is a crucial
positive step towards tribal and community control;
‘‘(2) the Bureau of Indian Affairs’ administra-
tion and domination of the contracting process
under such Act has not provided the full opportunity
to develop leadership skills crucial to the realization
of self-government and has denied Indians an effec-
tive voice in the planning and implementation of
627
HR 1 PCS
programs for the benefit of Indians which are re-
sponsive to the true needs of Indian communities;
‘‘(3) Indians will never surrender their desire to
control their relationships both among themselves
and with non-Indian governments, organizations,
and persons;
‘‘(4) true self-determination in any society of
people is dependent upon an educational process
which will ensure the development of qualified people
to fulfill meaningful leadership roles;
‘‘(5) the Federal administration of education
for Indian children has not effected the desired level
of educational achievement or created the diverse op-
portunities and personal satisfaction that education
can and should provide;
‘‘(6) true local control requires the least pos-
sible Federal interference; and
‘‘(7) the time has come to enhance the concepts
made manifest in the Indian Self-Determination and
Education Assistance Act.
‘‘SEC. 5203. DECLARATION OF POLICY.
‘‘(a) RECOGNITION.—Congress recognizes the obliga-
tion of the United States to respond to the strong expres-
sion of the Indian people for self-determination by assur-
ing maximum Indian participation in the direction of edu-
628
HR 1 PCS
cational services so as to render such services more re-
sponsive to the needs and desires of those communities.
‘‘(b) COMMITMENT.—Congress declares its commit-
ment to the maintenance of the Federal Government’s
unique and continuing trust relationship with and respon-
sibility to the Indian people through the establishment of
a meaningful Indian self-determination policy for edu-
cation which will deter further perpetuation of Federal bu-
reaucratic domination of programs.
‘‘(c) NATIONAL GOAL.—Congress declares that a
major national goal of the United States is to provide the
resources, processes, and structure which will enable tribes
and local communities to effect the quantity and quality
of educational services and opportunities which will permit
Indian children to compete and excel in the life areas of
their choice and to achieve the measure of self-determina-
tion essential to their social and economic well-being.
‘‘(d) EDUCATIONAL NEEDS.—Congress affirms the
reality of the special and unique educational needs of In-
dian peoples, including the need for programs to meet the
linguistic and cultural aspirations of Indian tribes and
communities. These may best be met through a grant
process.
‘‘(e) FEDERAL RELATIONS.—Congress declares its
commitment to these policies and its support, to the full
629
HR 1 PCS
extent of its responsibility, for Federal relations with the
Indian Nations.
‘‘(f) TERMINATION.—Congress hereby repudiates and
rejects House Resolution 108 of the 83d Congress and any
policy of unilateral termination of Federal relations with
any Indian Nation.
‘‘SEC. 5204. GRANTS AUTHORIZED.
‘‘(a) IN GENERAL.—
‘‘(1) ELIGIBILITY.—The Secretary shall provide
grants to Indian tribes, and tribal organizations
that—
‘‘(A) operate contract schools under title
XI of the Education Amendments of 1978 and
notify the Secretary of their election to operate
the schools with assistance under this part
rather than continuing as contract school;
‘‘(B) operate other tribally controlled
schools eligible for assistance under this part
and submit applications (which are approved by
their tribal governing bodies) to the Secretary
for such grants; or
‘‘(C) elect to assume operation of Bureau
funded schools with the assistance under this
part and submit applications (which are ap-
630
HR 1 PCS
proved by their tribal governing bodies) to the
Secretary for such grants.
‘‘(2) DEPOSIT
OF
FUNDS.—Grants provided
under this part shall be deposited into the general
operating fund of the tribally controlled school with
respect to which the grant is made.
‘‘(3) USE OF FUNDS.—(A) Except as otherwise
provided in this paragraph, grants provided under
this part shall be used to defray, at the discretion
of the school board of the tribally controlled school
with respect to which the grant is provided, any ex-
penditures for education related activities for which
any funds that compose the grant may be used
under the laws described in section 5205(a), includ-
ing, but not limited to, expenditures for—
‘‘(i) school operations, academic, edu-
cational, residential, guidance and counseling,
and administrative purposes; and
‘‘(ii) support services for the school, includ-
ing transportation.
‘‘(B) Grants provided under this part may, at
the discretion of the school board of the tribally con-
trolled school with respect to which such grant is
provided, be used to defray operations and mainte-
nance expenditures for the school if any funds for
631
HR 1 PCS
the operation and maintenance of the school are al-
located to the school under the provisions of any of
the laws described in section 5205(a).
‘‘(b) LIMITATIONS.—
‘‘(1) ONE GRANT PER TRIBE OR ORGANIZATION
PER FISCAL YEAR.—Not more than one grant may
be provided under this part with respect to any In-
dian tribe or tribal organization for any fiscal year.
‘‘(2) NONSECTARIAN
USE.—Funds provided
under any grant made under this part may not be
used in connection with religious worship or sec-
tarian instruction.
‘‘(3) ADMINISTRATIVE
COSTS
LIMITATION.—
Funds provided under any grant under this part
may not be expended for administrative costs (as de-
fined in section 1128(h)(1) of the Education Amend-
ments of 1978) in excess of the amount generated
for such costs under section 1128 of such Act.
‘‘(c) LIMITATION ON TRANSFER OF FUNDS AMONG
SCHOOLSITES.—
‘‘(1) IN GENERAL.—In the case of a grantee
that operates schools at more than one schoolsite,
the grantee may expend not more than the lesser
of—
632
HR 1 PCS
‘‘(A) 10 percent of the funds allocated for
such schoolsite under section 1128 of the Edu-
cation Amendments of 1978; or
‘‘(B) $400,000 of such funds, at any other
schoolsite.
‘‘(2) DEFINITION OF SCHOOLSITE.—For pur-
poses of this subsection, the term ‘schoolsite’ means
the physical location and the facilities of an elemen-
tary or secondary educational or residential program
operated by, or under contract or grant with, the
Bureau for which a discreet student count is identi-
fied under the funding formula established under
section 1127 of the Education Amendments of 1978.
‘‘(d) NO REQUIREMENT TO ACCEPT GRANTS.—
Nothing in this part may be construed—
‘‘(1) to require a tribe or tribal organization to
apply for or accept; or
‘‘(2) to allow any person to coerce any tribe or
tribal organization to apply for, or accept,
a grant under this part to plan, conduct, and administer
all of, or any portion of, any Bureau program. Such appli-
cations and the timing of such applications shall be strictly
voluntary. Nothing in this part may be construed as allow-
ing or requiring any grant with any entity other than the
entity to which the grant is provided.
633
HR 1 PCS
‘‘(e) NO EFFECT ON FEDERAL RESPONSIBILITY.—
Grants provided under this part shall not terminate, mod-
ify, suspend, or reduce the responsibility of the Federal
Government to provide a program.
‘‘(f) RETROCESSION.—
‘‘(1) IN
GENERAL.—Whenever a tribal gov-
erning body requests retrocession of any program for
which assistance is provided under this part, such
retrocession shall become effective upon a date speci-
fied by the Secretary that is not later than 120 days
after the date on which the tribal governing body re-
quests the retrocession. A later date as may be spec-
ified if mutually agreed upon by the Secretary and
the tribal governing body. If such a program is
retroceded, the Secretary shall provide to any Indian
tribe served by such program at least the same
quantity and quality of services that would have
been provided under such program at the level of
funding provided under this part prior to the ret-
rocession.
‘‘(2) STATUS AFTER RETROCESSION.—The tribe
requesting retrocession shall specify whether the ret-
rocession is to status as a Bureau operated school
or as a school operated under contract under title XI
of the Education Amendments of 1978.
634
HR 1 PCS
‘‘(3) TRANSFER
OF
EQUIPMENT
AND
MATE-
RIALS.—Except as otherwise determined by the Sec-
retary, the tribe or tribal organization operating the
program to be retroceded must transfer to the Sec-
retary (or to the tribe or tribal organization which
will operate the program as a contract school) the
existing equipment and materials which were
acquired—
‘‘(A) with assistance under this part; or
‘‘(B) upon assumption of operation of the
program under this part if the school was a Bu-
reau funded school under title XI of the Edu-
cation Amendments of 1978 before receiving as-
sistance under this part.
‘‘(g) PROHIBITION OF TERMINATION FOR ADMINIS-
TRATIVE CONVENIENCE.—Grants provided under this
part may not be terminated, modified, suspended, or re-
duced solely for the convenience of the administering agen-
cy.
‘‘SEC. 5205. COMPOSITION OF GRANTS.
‘‘(a) IN GENERAL.—The grant provided under this
part to an Indian tribe or tribal organization for any fiscal
year shall consist of—
‘‘(1) the total amount of funds allocated for
such fiscal year under sections 1127 and 1128 of the
635
HR 1 PCS
Education Amendments of 1978 with respect to the
tribally controlled schools eligible for assistance
under this part which are operated by such Indian
tribe or tribal organization, including, but not lim-
ited to, funds provided under such sections, or under
any other provision of law, for transportation costs;
‘‘(2) to the extent requested by such Indian
tribe or tribal organization, the total amount of
funds provided from operations and maintenance ac-
counts and, notwithstanding section 105 of the In-
dian Self-Determination Act, or any other provision
of law, other facilities accounts for such schools for
such fiscal year (including but not limited to those
referenced under section 1126(d) of the Education
Amendments of 1978 or any other law); and
‘‘(3) the total amount of funds that are allo-
cated to such schools for such fiscal year under—
‘‘(A) title I of the Elementary and Sec-
ondary Education Act of 1965;
‘‘(B) the Individuals with Disabilities Edu-
cation Act; and
‘‘(C) any other Federal education law, that
are allocated to such schools for such fiscal
year.
‘‘(b) SPECIAL RULES.—
636
HR 1 PCS
‘‘(1) IN GENERAL.—(A) Funds allocated to a
tribally controlled school by reason of paragraph (1)
or (2) of subsection (a) shall be subject to the provi-
sions of this part and shall not be subject to any ad-
ditional restriction, priority, or limitation that is im-
posed by the Bureau with respect to funds provided
under—
‘‘(i) title I of the Elementary and Sec-
ondary Education Act of 1965;
‘‘(ii) the Individuals with Disabilities Edu-
cation Act; or
‘‘(iii) any Federal education law other than
title XI of the Education Amendments of 1978.
‘‘(B) Indian tribes and tribal organizations to
which grants are provided under this part, and trib-
ally controlled schools for which such grants are pro-
vided, shall not be subject to any requirements, obli-
gations, restrictions, or limitations imposed by the
Bureau that would otherwise apply solely by reason
of the receipt of funds provided under any law re-
ferred to in clause (i), (ii), or (iii) of subparagraph
(A).
‘‘(2) 
SCHOOLS
CONSIDERED
CONTRACT
SCHOOLS.—Tribally controlled schools for which
grants are provided under this part shall be treated
637
HR 1 PCS
as contract schools for the purposes of allocation of
funds under sections 1126(d), 1127, and 1128 of
the Education Amendments of 1978.
‘‘(3) 
SCHOOLS
CONSIDERED
BUREAU
SCHOOLS.—Tribally controlled schools for which
grants are provided under this chapter shall be
treated as Bureau schools for the purposes of alloca-
tion of funds provided under—
‘‘(A) title I of the Elementary and Sec-
ondary Education Act of 1965;
‘‘(B) the Individuals with Disabilities Edu-
cation Act; and
‘‘(C) any other Federal education law, that
are distributed through the Bureau.
‘‘(4) ACCOUNTS; USE OF CERTAIN FUNDS.—(A)
Notwithstanding section 5204(a)(2), with respect to
funds from facilities improvement and repair, alter-
ation and renovation (major or minor), health and
safety, or new construction accounts included in the
grant under section 5204(a), the grantee shall main-
tain a separate account for such funds. At the end
of the period designated for the work covered by the
funds received, the grantee shall submit to the Sec-
retary a separate accounting of the work done and
the funds expended to the Secretary. Funds received
638
HR 1 PCS
from these accounts may only be used for the pur-
pose for which they were appropriated and for the
work encompassed by the application or submission
under which they were received.
‘‘(B) Notwithstanding subparagraph (A), a
school receiving a grant under this part for facilities
improvement and repair may use such grant funds
for new construction if the tribal government or
other organization provides funding for the new con-
struction equal to at least 25 percent of the total
cost of such new construction.
‘‘(C) Where the appropriations measure or the
application submission does not stipulate a period
for the work covered by the funds so designated, the
Secretary and the grantee shall consult and deter-
mine such a period prior to the transfer of the
funds. A period so determined may be extended
upon mutual agreement of the Secretary and the
grantee.
‘‘(5) ENFORCEMENT OF REQUEST TO INCLUDE
FUNDS.—If the Secretary fails to carry out a re-
quest made under subsection (a)(2) within 180 days
of a request filed by an Indian tribe or tribal organi-
zation to include in such tribe or organization’s
grant the funds described in subsection (a)(2), the
639
HR 1 PCS
Secretary shall be deemed to have approved such re-
quest and the Secretary shall immediately amend
the grant accordingly. Such tribe or organization
may enforce its rights under subsection (a)(2) and
this paragraph, including any denial or failure to act
on such tribe or organization’s request, pursuant to
the disputes authority described in section 5209(e).
‘‘SEC. 5206. ELIGIBILITY FOR GRANTS.
‘‘(a) RULES.—
‘‘(1) IN GENERAL.—A tribally controlled school
is eligible for assistance under this part if the
school—
‘‘(A) on April 28, 1988, was a contract
school under title XI of the Education Amend-
ments of 1978 and the tribe or tribal organiza-
tion operating the school submits to the Sec-
retary a written notice of election to receive a
grant under this part;
‘‘(B) was a Bureau operated school under
title XI of the Education Amendments of 1978
and has met the requirements of subsection (b);
‘‘(C) is a school for which the Bureau has
not provided funds, but which has met the re-
quirements of subsection (c); or
640
HR 1 PCS
‘‘(D) is a school with respect to which an
election has been made under paragraph (2)
and which has met the requirements of sub-
section (b).
‘‘(2) NEW
SCHOOLS.—Any application which
has been submitted under the Indian Self-Deter-
mination and Education Assistance Act by an Indian
tribe for a school which is not in operation on the
date of the enactment of the No Child Left Behind
Act of 2001 shall be reviewed under the guidelines
and regulations for applications submitted under the
Indian Self-Determination and Education Assistance
Act that were in effect at the time the application
was submitted, unless the Indian tribe or tribal or-
ganization elects to have the application reviewed
under the provisions of subsection (b).
‘‘(b) ADDITIONAL
REQUIREMENTS
FOR
BUREAU
FUNDED SCHOOLS AND CERTAIN ELECTING SCHOOLS.—
‘‘(1) BUREAU
FUNDED
SCHOOLS.—A school
that was a Bureau funded school under title XI of
the Education Amendments of 1978 on the date of
the enactment of the No Child Left Behind Act of
2001, and any school with respect to which an elec-
tion is made under subsection (a)(2), meets the re-
quirements of this subsection if—
641
HR 1 PCS
‘‘(A) the Indian tribe or tribal organization
that operates, or desires to operate, the school
submits to the Secretary an application request-
ing that the Secretary—
‘‘(i) transfer operation of the school to
the Indian tribe or tribal organization, if
the Indian tribe or tribal organization is
not already operating the school; and
‘‘(ii) make a determination as to
whether the school is eligible for assistance
under this part; and
‘‘(B) the Secretary makes a determination
that the school is eligible for assistance under
this part.
‘‘(2) CERTAIN
ELECTING
SCHOOLS.—(A) By
not later than the date that is 120 days after the
date on which an application is submitted to the
Secretary under paragraph (1)(A), the Secretary
shall determine—
‘‘(i) in the case of a school which is not
being operated by the Indian tribe or tribal or-
ganization, whether to transfer operation of the
school to the Indian tribe or tribal organization;
and
642
HR 1 PCS
‘‘(ii) whether the school is eligible for as-
sistance under this part.
‘‘(B) In considering applications submitted
under paragraph (1)(A), the Secretary—
‘‘(i) shall transfer operation of the school
to the Indian tribe or tribal organization, if the
tribe or tribal organization is not already oper-
ating the school; and
‘‘(ii) shall determine that the school is eli-
gible for assistance under this part, unless the
Secretary finds by clear and convincing evidence
that the services to be provided by the Indian
tribe or tribal organization will be deleterious to
the welfare of the Indians served by the school.
‘‘(C) In considering applications submitted
under paragraph (1)(A), the Secretary shall consider
whether the Indian tribe or tribal organization would
be deficient in operating the school with respect to—
‘‘(i) equipment;
‘‘(ii) bookkeeping and accounting proce-
dures;
‘‘(iii) ability to adequately manage a
school; or
‘‘(iv) adequately trained personnel.
643
HR 1 PCS
‘‘(c) ADDITIONAL REQUIREMENTS FOR A SCHOOL
WHICH IS NOT A BUREAU FUNDED SCHOOL.—
‘‘(1) IN GENERAL.—A school which is not a Bu-
reau funded school under title XI of the Education
Amendments of 1978 meets the requirements of this
subsection if—
‘‘(A) the Indian tribe or tribal organization
that operates, or desires to operate, the school
submits to the Secretary an application request-
ing a determination by the Secretary as to
whether the school is eligible for assistance
under this part; and
‘‘(B) the Secretary makes a determination
that a school is eligible for assistance under this
part.
‘‘(2) DEADLINE FOR DETERMINATION BY SEC-
RETARY.—(A) By not later than the date that is
180 days after the date on which an application is
submitted to the Secretary under paragraph (1)(A),
the Secretary shall determine whether the school is
eligible for assistance under this part.
‘‘(B) In making the determination under sub-
paragraph (A), the Secretary shall give equal consid-
eration to each of the following factors:
644
HR 1 PCS
‘‘(i) 
with 
respect 
to 
the 
applicant’s
proposal—
‘‘(I) the adequacy of facilities or the
potential to obtain or provide adequate fa-
cilities;
‘‘(II) geographic and demographic fac-
tors in the affected areas;
‘‘(III) adequacy of the applicant’s pro-
gram plans;
‘‘(IV) geographic proximity of com-
parable public education; and
‘‘(V) the needs as expressed by all af-
fected parties, including but not limited to
students, families, tribal governments at
both the central and local levels, and
school organizations; and
‘‘(ii) with respect to all education services
already available—
‘‘(I) geographic and demographic fac-
tors in the affected areas;
‘‘(II) adequacy and comparability of
programs already available;
‘‘(III) consistency of available pro-
grams with tribal education codes or tribal
legislation on education; and
645
HR 1 PCS
‘‘(IV) the history and success of these
services for the proposed population to be
served, as determined from all factors in-
cluding, if relevant, standardized examina-
tion performance.
‘‘(C) The Secretary may not make a deter-
mination under this paragraph that is primarily
based upon the geographic proximity of com-
parable public education.
‘‘(D) Applications submitted under para-
graph (1)(A) shall include information on the
factors described in subparagraph (B)(i), but
the applicant may also provide the Secretary
such information relative to the factors de-
scribed in subparagraph (B)(ii) as the applicant
considers appropriate.
‘‘(E) If the Secretary fails to make a de-
termination under subparagraph (A) with re-
spect to an application within 180 days after
the date on which the Secretary received the
application, the Secretary shall be treated as
having made a determination that the tribally
controlled school is eligible for assistance under
the title and the grant shall become effective 18
months after the date on which the Secretary
646
HR 1 PCS
received the application, or on an earlier date,
at the Secretary’s discretion.
‘‘(d) FILING OF APPLICATIONS AND REPORTS.—
‘‘(1) IN GENERAL.—All applications and reports
submitted to the Secretary under this part, and any
amendments to such applications or reports, shall be
filed with the education line officer designated by
the Director of the Office of Indian Education Pro-
grams of the Bureau of Indian Affairs. The date on
which such filing occurs shall, for purposes of this
part, be treated as the date on which the application
or amendment was submitted to the Secretary.
‘‘(2) SUPPORTING DOCUMENTATION.—Any ap-
plication that is submitted under this chapter shall
be accompanied by a document indicating the action
taken by the tribal governing body in authorizing
such application.
‘‘(e) EFFECTIVE DATE
FOR APPROVED APPLICA-
TIONS.—Except as provided by subsection (c)(2)(E), a
grant provided under this part, and any transfer of the
operation of a Bureau school made under subsection (b),
shall become effective beginning the academic year suc-
ceeding the fiscal year in which the application for the
grant or transfer is made, or at an earlier date determined
by the Secretary.
647
HR 1 PCS
‘‘(f) DENIAL OF APPLICATIONS.—
‘‘(1) IN GENERAL.—Whenever the Secretary re-
fuses to approve a grant under this chapter, to
transfer operation of a Bureau school under sub-
section (b), or determines that a school is not eligi-
ble for assistance under this part, the Secretary
shall—
‘‘(A) state the objections in writing to the
tribe or tribal organization within the allotted
time;
‘‘(B) provide assistance to the tribe or trib-
al organization to overcome all stated objec-
tions.
‘‘(C) at the request of the tribe or tribal
organization, provide the tribe or tribal organi-
zation a hearing on the record under the same
rules and regulations that apply under the In-
dian Self-Determination and Education Assist-
ance Act; and
‘‘(D) provide an opportunity to appeal the
objection raised.
‘‘(2) TIMELINE
FOR
RECONSIDERATION
OF
AMENDED APPLICATIONS.—The Secretary shall re-
consider any amended application submitted under
648
HR 1 PCS
this part within 60 days after the amended applica-
tion is submitted to the Secretary.
‘‘(g) REPORT.—The Bureau shall submit an annual
report to the Congress on all applications received, and
actions taken (including the costs associated with such ac-
tions), under this section at the same time that the Presi-
dent is required to submit to Congress the budget under
section 1105 of title 31, United States Code.
‘‘SEC. 5207. DURATION OF ELIGIBILITY DETERMINATION.
‘‘(a) IN GENERAL.—If the Secretary determines that
a tribally controlled school is eligible for assistance under
this part, the eligibility determination shall remain in ef-
fect until the determination is revoked by the Secretary,
and the requirements of subsection (b) or (c) of section
5206, if applicable, shall be considered to have been met
with respect to such school until the eligibility determina-
tion is revoked by the Secretary.
‘‘(b) ANNUAL REPORTS.—
‘‘(1) IN GENERAL.—Each recipient of a grant
provided under this part shall complete an annual
report which shall be limited to—
‘‘(A) an annual financial statement report-
ing revenue and expenditures as defined by the
cost accounting established by the grantee;
649
HR 1 PCS
‘‘(B) an annual financial audit conducted
pursuant to the standards of the Single Audit
Act of 1984;
‘‘(C) an annual submission to the Sec-
retary of the number of students served and a
brief description of programs offered under the
grant; and
‘‘(D) a program evaluation conducted by
an impartial evaluation review team, to be
based on the standards established for purposes
of subsection (c)(1)(A)(ii).
‘‘(2) EVALUATION REVIEW TEAMS.—Where ap-
propriate, other tribally controlled schools and rep-
resentatives of tribally controlled community colleges
shall make up members of the evaluation review
teams.
‘‘(3) EVALUATIONS.—In the case of a school
which is accredited, evaluations will be conducted at
intervals under the terms of accreditation.
‘‘(4) SUBMISSION OF REPORT.—
‘‘(A) TO
TRIBALLY
GOVERNING
BODY.—
Upon completion of the report required under
paragraph (a), the recipient of the grant shall
send (via first class mail, return receipt re-
quested) a copy of such annual report to the
650
HR 1 PCS
tribal governing body (as defined in section
1132(f) of the Education Amendments of 1978)
of the tribally controlled school.
‘‘(B) TO SECRETARY.—Not later than 30
days after receiving written confirmation that
the tribal governing body has received the re-
port send pursuant to subsection (A), the re-
cipient of the grant shall send a copy of the re-
port to the Secretary.
‘‘(c) REVOCATION OF ELIGIBILITY.—
‘‘(1) IN GENERAL.—(A) The Secretary shall not
revoke a determination that a school is eligible for
assistance under this part if—
‘‘(i) the Indian tribe or tribal organization
submits the reports required under subsection
(b) with respect to the school; and
‘‘(ii) at least one of the following sub-
clauses applies with respect to the school:
‘‘(I) The school is certified or accred-
ited by a State or regional accrediting as-
sociation or is a candidate in good stand-
ing for such accreditation under the rules
of the State or regional accrediting asso-
ciation, showing that credits achieved by
the students within the education pro-
651
HR 1 PCS
grams are, or will be, accepted at grade
level by a State certified or regionally ac-
credited institution.
‘‘(II) A determination made by the
Secretary that there is a reasonable expec-
tation that the accreditation described in
subclause (I), or the candidacy in good
standing for such accreditation, will be
reached by the school within 3 years and
that the program offered by the school is
beneficial to the Indian students.
‘‘(III) The school is accredited by a
tribal department of education if such ac-
creditation is accepted by a generally rec-
ognized regional or State accreditation
agency.
‘‘(IV) The schools accept the stand-
ards promulgated under section 1121 of
the Education Amendments of 1978 and
an evaluation of performance is conducted
under this section in conformance with the
regulations pertaining to Bureau operated
schools by an impartial evaluator chosen
by the grantee, but no grantee shall be re-
quired to comply with these standards to a
652
HR 1 PCS
higher degree than a comparable Bureau
operated school.
‘‘(V) A positive evaluation of the
school is conducted by an impartial eval-
uator agreed upon by the Secretary and
the grantee every 2 years under standards
adopted by the contractor under a contract
for a school entered into under the Indian
Self-Determination and Education Assist-
ance Act (or revisions of such standards
agreed to by the Secretary and the grant-
ee) prior to the date of the enactment of
this Act. If the Secretary and the grantee
other than the tribal governing body fail to
agree on such an evaluator, the tribal gov-
erning body shall choose the evaluator or
perform the evaluation. If the Secretary
and a grantee which is the tribal governing
body fail to agree on such an evaluator,
this subclause shall not apply.
‘‘(B) The choice of standards employed for the
purpose of subparagraph (A)(ii) shall be consistent
with section 1121(e) of the Education Amendments
of 1978.
653
HR 1 PCS
‘‘(2) NOTICE
REQUIREMENTS
FOR
REVOCA-
TION.—The Secretary shall not revoke a determina-
tion that a school is eligible for assistance under this
part, or reassume control of a school that was a Bu-
reau school prior to approval of an application sub-
mitted under section 5206(b)(1)(A) until the
Secretary—
‘‘(A) provides notice to the tribally con-
trolled school and the tribal governing body
(within the meaning of section 1141(14) of the
Education Amendments of 1978) of the tribally
controlled school which states—
‘‘(i) the specific deficiencies that led
to the revocation or resumption determina-
tion; and
‘‘(ii) the actions that are needed to
remedy such deficiencies; and
‘‘(B) affords such authority an opportunity
to effect the remedial actions.
‘‘(3) TECHNICAL ASSISTANCE.—The Secretary
shall provide such technical assistance as is prac-
ticable to effect such remedial actions. Such notice
and technical assistance shall be in addition to a
hearing and appeal to be conducted pursuant to the
regulations described in section 5206(f)(1)(C).
654
HR 1 PCS
‘‘(d) APPLICABILITY
OF SECTION PURSUANT
TO
ELECTION UNDER SECTION 5209(b).—With respect to a
tribally controlled school which receives assistance under
this part pursuant to an election made under section
5209(b)—
‘‘(1) subsection (b) of this section shall apply;
and
‘‘(2) the Secretary may not revoke eligibility for
assistance under this part except in conformance
with subsection (c) of this section.
‘‘SEC. 5208. PAYMENT OF GRANTS; INVESTMENT OF FUNDS.
‘‘(a) PAYMENTS.—
‘‘(1) IN GENERAL.—Except as otherwise pro-
vided in this subsection, the Secretary shall make
payments to grantees under this part in two pay-
ments, of which—
‘‘(A) the first payment shall be made not
later than July 15 of each year in an amount
equal to 85 percent of the amount which the
grantee was entitled to receive during the pre-
ceding academic year; and
‘‘(B) the second payment, consisting of the
remainder to which the grantee is entitled for
the academic year, shall be made not later than
December 1 of each year.
655
HR 1 PCS
‘‘(2) NEWLY
FUNDED
SCHOOLS.—For any
school for which no payment under this part was
made from Bureau funds in the preceding academic
year, full payment of the amount computed for the
first academic year of eligibility under this part shall
be made not later than December 1 of the academic
year.
‘‘(3) LATE FUNDING.—With regard to funds for
grantees that become available for obligation on Oc-
tober 1 of the fiscal year for which such funds are
appropriated, the Secretary shall make payments to
grantees not later than December 1 of the fiscal
year.
‘‘(4) APPLICABILITY OF CERTAIN TITLE 31 PRO-
VISIONS.—The provisions of chapter 39 of Title 31,
United States Code, shall apply to the payments re-
quired to be made by paragraphs (1), (2), and (3).
‘‘(5) RESTRICTIONS.—Paragraphs (1), (2), and
(3) shall be subject to any restriction on amounts of
payments under this part that are imposed by a con-
tinuing resolution or other Act appropriating the
funds involved.
‘‘(b) INVESTMENT OF FUNDS.—
‘‘(1) TREATMENT OF INTEREST AND INVEST-
MENT INCOME.—Notwithstanding any other provi-
656
HR 1 PCS
sion of law, any interest or investment income that
accrues to any funds provided under this part after
such funds are paid to the Indian tribe or tribal or-
ganization and before such funds are expended for
the purpose for which such funds were provided
under this part shall be the property of the Indian
tribe or tribal organization and shall not be taken
into account by any officer or employee of the Fed-
eral Government in determining whether to provide
assistance, or the amount of assistance, under any
provision of Federal law. Such interest income shall
be spent on behalf of the school.
‘‘(2) PERMISSIBLE INVESTMENTS.—Funds pro-
vided under this part may be invested by the Indian
tribe or tribal organization before such funds are ex-
pended for the purposes of this part so long as such
funds are—
‘‘(A) invested by the Indian tribe or tribal
organization only in obligations of the United
States, or in obligations or securities that are
guaranteed or insured by the United States, or
mutual (or other) funds registered with the Se-
curities and Exchange Commission and which
only invest in obligations of the United States,
657
HR 1 PCS
or securities that are guaranteed or insured by
the United States; or
‘‘(B) deposited only into accounts that are
insure by and agency or instrumentality of the
United States, or are fully collateralized to en-
sure protection of the funds, even in the event
of a bank failure.
‘‘(c) RECOVERIES.—For the purposes of under-
recovery and overrecovery determinations by any Federal
agency for any other funds, from whatever source derived,
funds received under this part shall not be taken into con-
sideration.
‘‘SEC. 5209. APPLICATION WITH RESPECT TO INDIAN SELF-
DETERMINATION AND EDUCATION ASSIST-
ANCE ACT.
‘‘(a) CERTAIN PROVISIONS TO APPLY TO GRANTS.—
The following provisions of the Indian Self-Determination
and Education Assistance Act (and any subsequent revi-
sions thereto or renumbering thereof), shall apply to
grants provided under this part:
‘‘(1) Section 5(f) (relating to single agency
audit).
‘‘(2) Section 6 (relating to criminal activities;
penalties).
658
HR 1 PCS
‘‘(3) Section 7 (relating to wage and labor
standards).
‘‘(4) Section 104 (relating to retention of Fed-
eral employee coverage).
‘‘(5) Section 105(f) (relating to Federal prop-
erty).
‘‘(6) Section 105(k) (relating to access to Fed-
eral sources of supply).
‘‘(7) Section 105(l) (relating to lease of facility
used for administration and delivery of services).
‘‘(8) Section 106(e) (relating to limitation on
remedies relating to cost allowances).
‘‘(9) Section 106(i) (relating to use of funds for
matching or cost participation requirements).
‘‘(10) Section 106(j) (relating to allowable uses
of funds).
‘‘(11) Section 108(c) (Model Agreements provi-
sions (1)(a)(5) (relating to limitations of costs),
(1)(a)(7) (relating to records and monitoring),
(1)(a)(8) (relating to property), and (a)(1)(9) (relat-
ing to availability of funds).
‘‘(12) Section 109 (relating to reassumption).
‘‘(13) Section 111 (relating to sovereign immu-
nity and trusteeship rights unaffected).
659
HR 1 PCS
‘‘(b) ELECTION
FOR GRANT
IN LIEU
OF CON-
TRACT.—
‘‘(1) IN GENERAL.—Contractors for activities to
which this part applies who have entered into a con-
tract under the Indian Self-Determination and Edu-
cation Assistance Act that is in effect upon the date
of the enactment of the No Child Left Behind Act
of 2001 may, by giving notice to the Secretary, elect
to have the provisions of this part apply to such ac-
tivity in lieu of such contract.
‘‘(2) EFFECTIVE
DATE
OF
ELECTION.—Any
election made under paragraph (1) shall take effect
on the later of—
‘‘(A) October 1 of the fiscal year suc-
ceeding the fiscal year in which such election is
made; or
‘‘(B) 60 days after the date of such elec-
tion.
‘‘(3) EXCEPTION.—In any case in which the 60-
day period referred to in paragraph (2)(B) is less
than 60 days before the beginning of the succeeding
fiscal year, such election shall not take effect until
the fiscal year after the fiscal year succeeding the
election.
660
HR 1 PCS
‘‘(c) NO DUPLICATION.—No funds may be provided
under any contract entered into under the Indian Self-De-
termination and Education Assistance Act to pay any ex-
penses incurred in providing any program or services if
a grant has been made under this part to pay such ex-
penses.
‘‘(d) TRANSFERS AND CARRYOVERS.—
‘‘(1) BUILDINGS, EQUIPMENT, SUPPLIES, MATE-
RIALS.—A tribe or tribal organization assuming the
operation of—
‘‘(A) a Bureau school with assistance
under this part shall be entitled to the transfer
or use of buildings, equipment, supplies, and
materials to the same extent as if it were con-
tracting under the Indian Self-Determination
and Education Assistance Act; or
‘‘(B) a contract school with assistance
under this part shall be entitled to the transfer
or use of buildings, equipment, supplies and
materials that were used in the operation of the
contract school to the same extent as if it were
contracting under the Indian Self-Determina-
tion and Education Assistance Act.
‘‘(2) FUNDS.—Any tribe or tribal organization
which assumes operation of a Bureau school with as-
661
HR 1 PCS
sistance under this part and any tribe or tribal orga-
nization which elects to operate a school with assist-
ance under this part rather that to continue as a
contract school shall be entitled to any funds which
would carryover from the previous fiscal year as if
such school were operated as a contract school.
‘‘(e) EXCEPTIONS, PROBLEMS, AND DISPUTES.—Any
exception or problem cited in an audit conducted pursuant
to section 5207(b)(2), any dispute regarding a grant au-
thorized to be made pursuant to this part or any amend-
ment to such grant, and any dispute involving an adminis-
trative cost grant under section 1128 of the Education
Amendments of 1978 shall be administered under the pro-
visions governing such exceptions, problems, or disputes
in the case of contracts under the Indian Self-Determina-
tion and Education Assistance Act of 1975. The Equal
Access to Justice Act shall apply to administrative appeals
filed after September 8, 1988, by grantees regarding a
grant under this part, including an administrative cost
grant.
‘‘SEC. 5210. ROLE OF THE DIRECTOR.
‘‘Applications for grants under this part, and all ap-
plication modifications, shall be reviewed and approved by
personnel under the direction and control of the Director
of the Office of Indian Education Programs. Required re-
662
HR 1 PCS
ports shall be submitted to education personnel under the
direction and control of the Director of such Office.
‘‘SEC. 5211. REGULATIONS.
‘‘The Secretary is authorized to issue regulations re-
lating to the discharge of duties specifically assigned to
the Secretary by this part. In all other matters relating
to the details of planning, development, implementing, and
evaluating grants under this part, the Secretary shall not
issue regulations. Regulations issued pursuant to this part
shall not have the standing of a Federal statute for the
purposes of judicial review.
‘‘SEC. 5212. THE TRIBALLY CONTROLLED GRANT SCHOOL
ENDOWMENT PROGRAM.
‘‘(a) IN GENERAL.—
‘‘(1) TRUST
FUNDS.—Each school receiving
grants under this part may establish, at a Federally
insured banking and savings institution, a trust fund
for the purposes of this section.
‘‘(2) AUTHORITY
OF
SCHOOLS
REGARDING
TRUST FUNDS.—The school may provide—
‘‘(A) for the deposit into the trust fund,
only funds from non-Federal sources, except
that the interest on funds received from grants
under this part may be used for this purpose;
663
HR 1 PCS
‘‘(B) for the deposit in the account of any
earnings on funds deposited in the account; and
‘‘(C) for the sole use of the school any
noncash, in-kind contributions of real or per-
sonal property, such property may at any time
be converted to cash.
‘‘(b) INTEREST.—Interest from the fund established
under subsection (a) may periodically be withdrawn and
used, at the discretion of the school, to defray any ex-
penses associated with the operation of the school.
‘‘SEC. 5213. DEFINITIONS.
‘‘For the purposes of this part:
‘‘(1) BUREAU.—The term ‘Bureau’ means the
Bureau of Indian Affairs of the Department of the
Interior.
‘‘(2) ELIGIBLE
INDIAN
STUDENT.—The term
‘eligible Indian student’ has the meaning of such
term in section 1127(f) of the Education Amend-
ments of 1978.
‘‘(3) INDIAN TRIBE.—The term ‘Indian tribe’
means any Indian tribe, band, nation, or other orga-
nized group or community, including Alaska Native
Village or regional corporations (as defined in or es-
tablished pursuant to the Alaskan Native Claims
Settlement Act, which is recognized as eligible for
664
HR 1 PCS
the special programs and services provided by the
United States to Indians because of their status as
Indians.
‘‘(4) LOCAL EDUCATIONAL AGENCY.—The term
‘local educational agency’ means a public board of
education or other public authority legally con-
stituted within a State for either administrative con-
trol or direction of, or to perform a service function
for, public elementary or secondary schools in a city,
county, township, school district, or other political
subdivision of a State or such combination of school
districts or counties as are recognized in a State as
an administrative agency for its public elementary or
secondary schools. Such term includes any other
public institution or agency having administrative
control and direction of a public elementary or sec-
ondary school.
‘‘(5) SECRETARY.—The term ‘Secretary’ means
the Secretary of the Interior.
‘‘(6) TRIBAL
ORGANIZATION.—(A) The term
‘tribal organization’ means—
‘‘(i) the recognized governing body of any
Indian tribe; or
‘‘(ii) any legally established organization of
Indians which—
665
HR 1 PCS
‘‘(I) is controlled, sanctioned, or char-
tered by such governing body or is demo-
cratically elected by the adult members of
the Indian community to be served by such
organization; and
‘‘(II) includes the maximum participa-
tion of Indians in all phases of its activi-
ties.
‘‘(B) In any case in which a grant is provided
under this part to an organization to provide serv-
ices benefiting more than one Indian tribe, the ap-
proval of the governing bodies of Indian tribes rep-
resenting 80 percent of those students attending the
tribally controlled school shall be considered a suffi-
cient tribal authorization for such grant.
‘‘(7) TRIBALLY
CONTROLLED
SCHOOL.—The
term ‘tribally controlled school’ means a school oper-
ated by a tribe or a tribal organization, enrolling
students in kindergarten through grade 12, includ-
ing preschools, which is not a local educational agen-
cy and which is not directly administered by the Bu-
reau of Indian Affairs.’’.
666
HR 1 PCS
SEC. 
315. 
ACCOUNTABILITY 
FOR 
BUREAU 
FUNDED
SCHOOLS.
Notwithstanding the provisions of section 7102 of the
Elementary and Secondary Education Act of 1965, the
Secretary shall limit any reduction of administrative fund-
ing for the Bureau of Indian Affairs under such section
to no more than 50 percent of the amount that may be
reserved for administration under such Act.
TITLE 
IV—PROMOTING 
IN-
FORMED PARENTAL CHOICE
AND INNOVATIVE PROGRAMS
PART A—INNOVATIVE PROGRAMS
SEC. 401. INNOVATIVE PROGRAMS.
Title IV is amended to read as follows:
‘‘TITLE 
IV—PROMOTING 
IN-
FORMED PARENTAL CHOICE
AND INNOVATIVE PROGRAMS
‘‘PART A—INNOVATIVE PROGRAMS
‘‘Subpart 1—State and Local Innovative Programs
‘‘SEC. 4101. FINDINGS AND STATEMENT OF PURPOSE.
‘‘(a) FINDINGS.—Congress finds that this subpart—
‘‘(1) provides flexibility to meet local needs;
‘‘(2) promotes local and State education re-
forms;
‘‘(3) contributes to the improvement of aca-
demic achievement for all students;
667
HR 1 PCS
‘‘(4) provides funding for critical activities; and
‘‘(5) provides services for private school stu-
dents.
‘‘(b) STATEMENT OF PURPOSE.—It is the purpose of
programs under this subpart—
‘‘(1) to provide funding to enable States and
local educational agencies to implement promising
educational reform programs and school improve-
ment initiatives based on scientifically based re-
search;
‘‘(2) to provide a continuing source of innova-
tion and educational improvement, including support
for library services and instructional and media ma-
terials; and
‘‘(3) to meet the educational needs of all stu-
dents, including at-risk youth.
‘‘(c) STATE AND LOCAL RESPONSIBILITY.—
‘‘(1) IN GENERAL.—The States shall have the
basic responsibility for the administration of funds
made available under this subpart, but such admin-
istration shall be carried out with a minimum of pa-
perwork.
‘‘(2) DESIGN
AND
IMPLEMENTATION.—Not-
withstanding paragraph (1), local educational agen-
cies, school superintendents and principals, and
668
HR 1 PCS
classroom teachers and supporting personnel shall be
mainly responsible for the design and implementa-
tion of programs assisted under this subpart, be-
cause such agencies and individuals have the most
direct contact with students and are most likely to
be able to design programs to meet the educational
needs of students in their own school districts.
‘‘CHAPTER 1—STATE AND LOCAL
PROGRAMS
‘‘SEC. 4111. ALLOCATION TO STATES.
‘‘(a) RESERVATIONS.—From the sums appropriated
to carry out this subpart for each fiscal year, the Secretary
shall reserve not more than 1 percent for payments to out-
lying areas to be allotted in accordance with their respec-
tive needs.
‘‘(b) ALLOCATION OF REMAINDER.—From the re-
mainder of such sums, the Secretary shall allocate, and
make available in accordance with this subpart, to each
State an amount which bears the same ratio to the
amount of such remainder as the school-age population
of the State bears to the school-age population of all
States, except that no State shall receive less than an
amount equal to 1⁄2 of 1 percent of such remainder.
669
HR 1 PCS
‘‘SEC. 4112. ALLOCATION TO LOCAL EDUCATIONAL AGEN-
CIES.
‘‘(a) DISTRIBUTION RULE.—
‘‘(1) IN GENERAL.—Subject to paragraph (2),
from the sums made available each year to carry out
this subpart, the State shall distribute not less than
85 percent to local educational agencies within such
State according to the relative enrollments in public
and private, nonprofit schools within the jurisdic-
tions of such agencies, adjusted, in accordance with
criteria approved by the Secretary, to provide higher
per-pupil allocations to local educational agencies
that have the greatest numbers or percentages of
children whose education imposes a higher than av-
erage cost per child, such as—
‘‘(A) children living in areas with high con-
centrations of economically disadvantaged fami-
lies;
‘‘(B) children from economically disadvan-
taged families; and
‘‘(C) children living in sparsely populated
areas.
‘‘(2) EXCEPTION.—100 percent of any amount
by which the funds paid to a State under this sub-
part for a fiscal year exceed the amount of such
funds paid to the State for fiscal year 2001 shall be
670
HR 1 PCS
distributed to local educational agencies and used lo-
cally for innovative assistance described in section
4131(b).
‘‘(3) LIMITATION ON USE OF FUNDS FOR AD-
MINISTRATION.—In each fiscal year, a State may
use not more than 25 percent of the funds available
for State programs under this subpart for State ad-
ministration under section 4121.
‘‘(b) CALCULATION OF ENROLLMENTS.—
‘‘(1) IN GENERAL.—The calculation of relative
enrollments under subsection (a)(1) shall be on the
basis of the total of—
‘‘(A) the number of children enrolled in
public schools; and
‘‘(B) the number of children enrolled in
private, nonprofit schools whose parents would
like their children to participate in programs or
projects assisted under this subpart, for the fis-
cal year preceding the fiscal year for which the
determination is made.
‘‘(2) CONSTRUCTION.—Nothing in this sub-
section shall diminish the responsibility of each local
educational agency to contact, on an annual basis,
appropriate officials from private nonprofit schools
within the areas served by such agencies in order to
671
HR 1 PCS
determine whether such schools desire that their
children participate in programs assisted under this
chapter.
‘‘(3) ADJUSTMENTS.—
‘‘(A) IN
GENERAL.—Relative enrollments
calculated under subsection (a)(1) shall be ad-
justed, in accordance with criteria approved by
the Secretary under subparagraph (B), to pro-
vide higher per-pupil allocations only to local
educational agencies that serve the greatest
numbers or percentages of—
‘‘(i) children living in areas with high
concentrations of economically disadvan-
taged families;
‘‘(ii) children from economically dis-
advantaged families; or
‘‘(iii) children living in sparsely popu-
lated areas.
‘‘(B) CRITERIA.—The Secretary shall re-
view criteria submitted by a State for adjusting
allocations under paragraph (1) and shall ap-
prove such criteria only if the Secretary deter-
mines that such criteria are reasonably cal-
culated to produce an adjusted allocation that
reflects the relative needs of the State’s local
672
HR 1 PCS
educational agencies based on the factors set
forth in subparagraph (A).
‘‘(c) PAYMENT OF ALLOCATIONS.—
‘‘(1) DISTRIBUTION.—From the funds paid to a
State under this subpart for a fiscal year, a State
shall distribute to each eligible local educational
agency that has submitted an application as required
in section 4133 the amount of such local educational
agency’s allocation, as determined under subsection
(a).
‘‘(2) ADDITIONAL FUNDS.—
‘‘(A) IN GENERAL.—Additional funds re-
sulting from higher per-pupil allocations pro-
vided to a local educational agency on the basis
of adjusted enrollments of children described in
subsection (a)(1) may, in the discretion of the
local educational agency, be allocated for ex-
penditures to provide services for children en-
rolled in public and private, nonprofit schools in
direct proportion to the number of children de-
scribed in subsection (a)(1) and enrolled in
such schools within the local educational agen-
cy.
‘‘(B) ELECTION.—In any fiscal year, any
local educational agency that elects to allocate
673
HR 1 PCS
such additional funds in the manner described
in subparagraph (A) shall allocate all additional
funds to schools within the local educational
agency in such manner.
‘‘(C) CONSTRUCTION.—Subparagraphs (A)
and (B) may not be construed to require any
school to limit the use of the additional funds
described in subparagraph (A) to the provision
of services to specific students or categories of
students.
‘‘CHAPTER 2—STATE PROGRAMS
‘‘SEC. 4121. STATE USE OF FUNDS.
‘‘A State may use funds made available for State use
under this subpart only for—
‘‘(1) State administration of programs under
this subpart including—
‘‘(A) supervision of the allocation of funds
to local educational agencies;
‘‘(B) planning, supervision, and processing
of State funds; and
‘‘(C) monitoring and evaluation of pro-
grams and activities under this subpart;
‘‘(2) support for planning, designing, and initial
implementation of charter schools as described in
part B;
674
HR 1 PCS
‘‘(3) statewide education reform and school im-
provement activities and technical assistance and di-
rect grants to local educational agencies which assist
such agencies under section 4131; and
‘‘(4) support for arrangements that provide for
independent analysis to measure and report on
school district achievement.
‘‘SEC. 4122. STATE APPLICATIONS.
‘‘(a) APPLICATION
REQUIREMENTS.—If a State
seeks to receive assistance under this subpart, the indi-
vidual, entity, or agency responsible for public elementary
and secondary education policy under the State constitu-
tion or State law shall submit to the Secretary an applica-
tion that—
‘‘(1) provides for an annual statewide summary
of how assistance under this subpart is contributing
toward improving student achievement or improving
the quality of education for students;
‘‘(2) provides information setting forth the allo-
cation of such funds required to implement section
4142;
‘‘(3) provides that the State will keep such
records and provide such information to the Sec-
retary as may be required for fiscal audit and pro-
675
HR 1 PCS
gram evaluation (consistent with the responsibilities
of the Secretary under this section);
‘‘(4) provides assurance that, apart from tech-
nical and advisory assistance and monitoring compli-
ance with this subpart, the State has not exercised
and will not exercise any influence in the decision-
making processes of local educational agencies as to
the expenditure made pursuant to an application
under section 4133;
‘‘(5) contains assurances that there is compli-
ance with the specific requirements of this subpart;
and
‘‘(6) provides for timely public notice and public
dissemination of the information provided under
paragraph (2).
‘‘(b) STATEWIDE SUMMARY.—The statewide sum-
mary referred to in subsection (a)(1) shall be submitted
to the Secretary and shall be derived from the evaluation
information submitted by local educational agencies to the
State under section 4133(a)(2)(H). The format and con-
tent of such summary shall be in the discretion of the
State and may include statistical measures such as the
number of students served by each type of innovative as-
sistance described in section 4131(b), including the num-
ber of teachers trained.
676
HR 1 PCS
‘‘(c) PERIOD OF APPLICATION.—An application filed
by the State under subsection (a) shall be for a period
not to exceed 3 years, and may be amended annually as
may be necessary to reflect changes without filing a new
application.
‘‘(d) AUDIT LIMITATION.—Each local educational
agency receiving less than an average of $5,000 under this
subpart may not be audited more frequently than once
every 5 years.
‘‘CHAPTER 3—LOCAL INNOVATIVE
EDUCATION PROGRAMS
‘‘SEC. 4131. USE OF FUNDS.
‘‘(a) IN GENERAL.—Funds made available to local
educational agencies under section 4112 shall be used for
innovative assistance programs described in subsection
(b).
‘‘(b) INNOVATIVE ASSISTANCE.—The innovative as-
sistance programs referred to in subsection (a) may
include—
‘‘(1) professional development activities and the
hiring of teachers, including activities carried out in
accordance with title II, that give teachers, prin-
cipals, and administrators the knowledge and skills
to provide students with the opportunity to meet
677
HR 1 PCS
challenging State or local academic content stand-
ards and student achievement standards;
‘‘(2) technology related to the implementation
of school-based reform programs, including profes-
sional development to assist teachers, and other
school officials, regarding how to use effectively such
equipment and software;
‘‘(3) programs for the development or acquisi-
tion and use of instructional and educational mate-
rials, including library services and materials (in-
cluding media materials), academic assessments, ref-
erence materials, computer software and hardware
for instructional use, and other curricular materials
that are tied to high academic standards, that will
be used to improve student achievement, and that
are part of an overall education reform program;
‘‘(4) promising education reform projects, in-
cluding effective schools and magnet schools;
‘‘(5) programs to improve the academic skills of
disadvantaged elementary and secondary school stu-
dents and to prevent students from dropping out of
school;
‘‘(6) programs to combat illiteracy;
‘‘(7) programs to provide for the educational
needs of gifted and talented children;
678
HR 1 PCS
‘‘(8) planning, designing, and initial implemen-
tation of charter schools as described in part B;
‘‘(9) school improvement programs or activities
under sections 1116 and 1117;
‘‘(10) community service programs that use
qualified school personnel to train and mobilize
young people to measurably strengthen their com-
munities through nonviolence, responsibility, com-
passion, respect, and moral courage;
‘‘(11) activities to promote consumer, economic,
and personal finance education, such as dissemi-
nating and encouraging the best practices for teach-
ing the basic principles of economics and promoting
the concept of achieving financial literacy through
the teaching of personal financial management skills
(including the basic principles involved with earning,
spending, saving, and investing);
‘‘(12) activities to promote, implement, or ex-
pand public school choice;
‘‘(13) programs to hire and support school
nurses;
‘‘(14) expanding and improving school-based
mental health services, including early identification
of drug use and violence, assessment, and direct in-
dividual or group counseling services provided to stu-
679
HR 1 PCS
dents, parents, and school personnel by qualified
school based mental health services personnel;
‘‘(15) alternative educational programs for
those students who have been expelled or suspended
from their regular educational setting, including pro-
grams to assist students to reenter the regular edu-
cational setting upon return from treatment or alter-
native educational programs;
‘‘(16) programs to establish or enhance pre-
kindergarten programs for children ages 3 through
5;
‘‘(17) academic intervention programs that are
operated jointly with community-based organizations
and that support academic enrichment and coun-
seling programs conducted during the school day
(including during extended school day or extended
school year programs) for students most-at-risk of
not meeting challenging State academic standards or
not completing secondary school;
‘‘(18) programs for cardiopulmonary resuscita-
tion (CPR) training in schools; and
‘‘(19) programs to establish smaller learning
communities.
680
HR 1 PCS
‘‘SEC. 4132. ADMINISTRATIVE AUTHORITY.
‘‘In order to conduct the activities authorized by this
subpart, each State or local educational agency may use
funds made available under this subpart to make grants
to, and to enter into contracts with, local educational
agencies, institutions of higher education, libraries, muse-
ums, and other public and private nonprofit agencies, or-
ganizations, and institutions, including religious organiza-
tions.
‘‘SEC. 4133. LOCAL APPLICATIONS.
‘‘(a) CERTIFICATION.—
‘‘(1) IN GENERAL.—A local educational agency
or a consortium of such agencies may receive an al-
location of funds under this subpart for any year for
which the agency or consortium submits an applica-
tion under this section that is certified by the State
to meet the requirements of this section.
‘‘(2) CONTENTS OF APPLICATION.—The State
shall certify each application that—
‘‘(A) describes locally identified needs rel-
ative to the purposes of this subpart and to the
innovative 
assistance 
described 
in 
section
4131(b);
‘‘(B) based on the needs identified in sub-
paragraph (A), sets forth the planned allocation
of funds among innovative assistance programs
681
HR 1 PCS
described in section 4131 and describes the pro-
grams, projects, and activities designed to carry
out such innovative assistance programs that
the local educational agency intends to support;
‘‘(C) contains information setting forth the
allocation of such funds required to implement
section 4142;
‘‘(D) describes how assistance under this
subpart will contribute to improving student
academic achievement;
‘‘(E) provides assurances of compliance
with the provisions of this subpart, including
the participation of children enrolled in private,
nonprofit schools in accordance with section
4142;
‘‘(F) provides assurance that the local edu-
cational agency will keep such records, and pro-
vide such information to the State as may be
reasonably required for fiscal audit and pro-
gram evaluation, consistent with the respon-
sibilities of the State under this subpart;
‘‘(G) provides in the allocation of funds for
the assistance authorized by this subpart, and
in the design, planning, and implementation of
such programs, for systematic consultation with
682
HR 1 PCS
parents of children attending elementary and
secondary schools in the area served by the
local educational agency, with teachers and ad-
ministrative personnel in such schools, and with
other groups involved in the implementation of
this subpart (such as librarians, school coun-
selors, and other pupil services personnel) as
may be considered appropriate by the local edu-
cational agency; and
‘‘(H) provides assurance that—
‘‘(i) programs, services, and activities
will be evaluated annually;
‘‘(ii) such evaluation will be used to
determine 
and 
implement 
appropriate
changes in program services and activities
for the subsequent year;
‘‘(iii) such evaluation will describe
how assistance under this subpart contrib-
uted toward improving student academic
achievement; and
‘‘(iv) such evaluation will be submitted
to the State in the time and manner re-
quested by the State.
‘‘(b) TIME PERIOD TO WHICH APPLICATION RE-
LATES.—An application submitted by a local educational
683
HR 1 PCS
agency under subsection (a) may seek allocations under
this part for a period of time not to exceed 3 fiscal years
and may be amended annually as may be necessary to re-
flect changes without the filing of a new application.
‘‘(c) LOCAL EDUCATIONAL AGENCY DISCRETION.—
‘‘(1) IN GENERAL.—Subject to the limitations
and requirements of this subpart, a local educational
agency shall have complete discretion in determining
how funds made available under this chapter will be
divided among programs and activities described in
section 4131.
‘‘(2) LIMITATION.—In exercising the discretion
described in paragraph (1), a local educational agen-
cy shall ensure that expenditures under this chapter
carry out the purposes of this subpart and are used
to meet the educational needs within the schools of
such local educational agency.
‘‘CHAPTER 4—GENERAL PROVISIONS
‘‘SEC. 4141. MAINTENANCE OF EFFORT; FEDERAL FUNDS
SUPPLEMENTARY.
‘‘(a) MAINTENANCE OF EFFORT.—
‘‘(1) IN GENERAL.—Except as provided in para-
graph (2), a State is entitled to receive its full allo-
cation of funds under this subpart for any fiscal
year only if the Secretary determines that either the
684
HR 1 PCS
combined fiscal effort per student or the aggregate
expenditures within the State with respect to the
provision of free public education for the fiscal year
preceding the fiscal year for which the determination
is made was not less than 90 percent of such com-
bined fiscal effort or aggregate expenditures for the
fiscal year that is 2 fiscal years before the fiscal year
for which the determination is made.
‘‘(2) REDUCTION
OF
FUNDS.—The Secretary
shall reduce the amount of the allocation of funds
under this subpart in any fiscal year in the exact
proportion to which the State fails to meet the re-
quirements of paragraph (1) by falling below 90 per-
cent of both the fiscal effort per student and aggre-
gate expenditures (using the measure most favorable
to the State), and no such lesser amount shall be
used for computing the effort required under para-
graph (1) for subsequent years.
‘‘(3) WAIVER.—The Secretary may waive, for 1
fiscal year only, the requirements of this section if
the Secretary determines that such a waiver would
be equitable due to exceptional or uncontrollable cir-
cumstances such as a natural disaster or a precipi-
tous and unforeseen decline in the financial re-
sources of the State.
685
HR 1 PCS
‘‘(b) FEDERAL FUNDS SUPPLEMENTARY.—A State
or local educational agency may use and allocate funds
received under this subpart only to supplement and, to the
extent practical, to increase the level of funds that would,
in the absence of Federal funds made available under this
subpart, be made available from non-Federal sources, and
in no case may such funds be used so as to supplant funds
from non-Federal sources.
‘‘SEC. 4142. PARTICIPATION OF CHILDREN ENROLLED IN
PRIVATE SCHOOLS.
‘‘(a) PARTICIPATION ON EQUITABLE BASIS.—
‘‘(1) IN
GENERAL.—To the extent consistent
with the number of children in the school district of
a local educational agency which is eligible to receive
funds under this subpart or which serves the area in
which a program or project assisted under this sub-
part is located, who are enrolled in private nonprofit
elementary and secondary schools, or with respect to
instructional or personnel training programs funded
by the State from funds made available for State
use, such agency, after consultation with appropriate
private school officials—
‘‘(A) shall provide for the benefit of such
children in such schools secular, neutral, and
nonideological services, materials, and equip-
686
HR 1 PCS
ment, including the participation of the teach-
ers of such children (and other educational per-
sonnel serving such children) in training pro-
grams, and the repair or minor remodeling of
public facilities as may be necessary for their
provision (consistent with subsection (c) of this
section); or
‘‘(B) if such services, materials, and equip-
ment are not feasible or necessary in one or
more such private schools as determined by the
local educational agency after consultation with
the appropriate private school officials, shall
provide such other arrangements as will assure
equitable participation of such children in the
purposes and benefits of this subpart.
‘‘(2) OTHER PROVISIONS FOR SERVICES.—If no
program or project is carried out under paragraph
(1) in the school district of a local educational agen-
cy, the State shall make arrangements, such as
through contracts with nonprofit agencies or organi-
zations, under which children in private schools in
such district are provided with services and mate-
rials to the extent that would have occurred if the
local educational agency had received funds under
this subpart.
687
HR 1 PCS
‘‘(3) APPLICATION
OF
REQUIREMENTS.—The
requirements of this section relating to the participa-
tion of children, teachers, and other personnel serv-
ing such children shall apply to programs and
projects carried out under this subpart by a State or
local educational agency, whether directly or through
grants to or contracts with other public or private
agencies, institutions, or organizations.
‘‘(b) EQUAL EXPENDITURES.—
‘‘(1) IN GENERAL.—Expenditures for programs
pursuant to subsection (a) shall be equal (consistent
with the number of children to be served) to expend-
itures for programs under this subpart for children
enrolled in the public schools of the local educational
agency.
‘‘(2) CONCENTRATED PROGRAMS.—Taking into
account the needs of the individual children and
other factors which relate to the expenditures re-
ferred to in paragraph (1), and when funds available
to a local educational agency under this subpart are
used to concentrate programs or projects on a par-
ticular group, attendance area, or grade or age level,
children enrolled in private schools who are included
within the group, attendance area, or grade or age
level selected for such concentration shall, after con-
688
HR 1 PCS
sultation with the appropriate private school offi-
cials, be assured equitable participation in the pur-
poses and benefits of such programs or projects.
‘‘(c) ADMINISTRATIVE RULES.—
‘‘(1) FUNDS AND PROPERTY.—The control of
funds provided under this subpart, and title to mate-
rials, equipment, and property repaired, remodeled,
or constructed with such funds, shall be in a public
agency for the uses and purposes provided in this
subpart, and a public agency shall administer such
funds and property.
‘‘(2) PROVISION OF SERVICES.—The provision
of services pursuant to this subpart shall be provided
by employees of a public agency or through contract
by such public agency with a person, an association,
agency, or corporation who or which, in the provi-
sion of such services, is independent of such private
school and of any religious organizations, and such
employment or contract shall be under the control
and supervision of such public agency, and the funds
provided under this subpart shall not be commingled
with State or local funds.
‘‘(d) WAIVER.—
‘‘(1) STATE PROHIBITION WAIVER.—If by rea-
son of any provision of law a State or local edu-
689
HR 1 PCS
cational agency is prohibited from providing for the
participation in programs of children enrolled in pri-
vate elementary and secondary schools, as required
by this section, the Secretary shall waive such re-
quirements and shall arrange for the provision of
services to such children through arrangements
which shall be subject to the requirements of this
section.
‘‘(2) FAILURE TO COMPLY.—If the Secretary
determines that a State or a local educational agen-
cy has substantially failed or is unwilling to provide
for the participation on an equitable basis of chil-
dren enrolled in private elementary and secondary
schools as required by this section, the Secretary
may waive such requirements and shall arrange for
the provision of services to such children through ar-
rangements which shall be subject to the require-
ments of this section.
‘‘(e) WITHHOLDING OF ALLOCATION.—Pending final
resolution of any investigation or complaint that could re-
sult in a waiver under subsection (d)(1) or (d)(2), the Sec-
retary may withhold from the allocation of the affected
State or local educational agency the amount estimated
by the Secretary to be necessary to pay the cost of services
to be provided by the Secretary under such subsection.
690
HR 1 PCS
‘‘(f) TERM OF DETERMINATIONS.—Any determina-
tion by the Secretary under this section shall continue in
effect until the Secretary determines that there will no
longer be any failure or inability on the part of the State
or local educational agency to meet the requirements of
subsections (a) and (b).
‘‘(g) PAYMENT FROM STATE ALLOTMENT.—When
the Secretary arranges for services pursuant to this sec-
tion, the Secretary shall, after consultation with the ap-
propriate public and private school officials, pay the cost
of such services, including the administrative costs of ar-
ranging for those services, from the appropriate allotment
of the State under this subpart.
‘‘(h) REVIEW.—
‘‘(1) WRITTEN
OBJECTIONS.—The Secretary
shall not take any final action under this section
until the State and the local educational agency af-
fected by such action have had an opportunity, for
not less than 45 days after receiving written notice
thereof, to submit written objections and to appear
before the Secretary or the Secretary’s designee to
show cause why that action should not be taken.
‘‘(2) COURT ACTION.—If a State or local edu-
cational agency is dissatisfied with the Secretary’s
final action after a proceeding under paragraph (1),