Opinion ID: 507855
Heading Depth: 2
Heading Rank: 1

Heading: Food and Lodging Expenses

Text: 9 In disallowing the amounts spent for food and lodging, the Secretary concluded that seven District-sponsored conferences could have been held at District facilities within a reasonable commuting distance of the participants' homes. The Secretary also disallowed food and lodging costs for two conferences that were sponsored by a statewide organization and were held in Anaheim. These expenditures were disallowed because Anaheim was within a reasonable commuting distance of the District. For all nine conferences, the Secretary concluded that meals and overnight lodging to attend conferences within a reasonable commuting distance were unnecessary. Department regulations require that Title I expenditures be necessary and reasonable, 34 C.F.R. pt. 74, App. C, pt. I, C.1.a (1981), and that they not be imprudent, extravagant, excessive, or wasteful. 34 C.F.R. Sec. 200.71 (1981) (formerly 45 C.F.R. Sec. 116a.22(b)(4)(ii) (1980)). 1 10 California presents three arguments challenging the disallowance of its expenditure of Title I funds for food and lodging expenses for the conferences. First, California argues that the District and the participants received non-economic benefits by holding the conferences at hotels rather than at District facilities. Second, California argues that the enormous geographic size of the District made daily commuting to and from the conferences unreasonable for some participants. Third, California contends that since the seven conferences it sponsored served Title I purposes, California must be given credit for the costs that would have been incurred had the conferences been held at District facilities.
11 The Department does not contest that holding conferences at hotels rather than at District facilities encouraged conference participation, a non-economic benefit claimed by California. The regulations, however, require that the expenditure of Title I funds be necessary and reasonable. 34 C.F.R. pt. 74, App. C, pt. I, C.1.a (1981). The auditors concluded that, based on the regulations, using Title I funds to pay food and lodging expenses to encourage participation at conferences was not allowable or reasonable. California had the burden to present evidence to support its challenge to this determination. See 20 U.S.C. Sec. 1234a(b); 34 C.F.R. Sec. 78.16 (1981). 2 It did not present any evidence in support of its non-economic benefits contention. It failed, therefore, to justify the food and lodging expenditures on this basis.
12 California next argues that its expenditures for food and lodging were necessary and reasonable, because the District is so large that it was unreasonable to require participants to commute to and from the conference sites on a daily basis. California represents that a normal commuting distance is 25 miles. Even if we were to accept this representation, however, seven of the conferences were District-sponsored and could have been located within the District. California presented no evidence to show the number of participants who would have had to endure a 25-mile, or longer, commute to such centrally located conference sites. Thus, there was no evidence upon which the Board could have determined that it was necessary or reasonable to pay food and lodging costs due to the long commute participants had to make to attend these conferences. California had the obligation to present evidence to support its long commute theory. See 20 U.S.C. Sec. 1234a(b); 34 C.F.R. Sec. 78.16 (1981). It did not do so. We, therefore, reject California's long commute argument as it applies to the seven District-sponsored conferences. 13 The two state-sponsored conferences, however, require a different analysis. These two conferences were held in Anaheim, outside the District, and were sponsored by a statewide organization. The Department implicitly admitted that Anaheim was outside the normal commuting distance for some of the participants. The auditors' report indicates that approximately ten percent of the participants who attended these two conferences could have reached Anaheim only after commuting farther than a normal distance. The District could not relocate these conferences within the District, because it did not sponsor them. 14 Department regulations permit reimbursement for travel expenses when they are part of a cost effective effort to consolidate the training programs of more than one district. See 34 C.F.R. Secs. 201.161(b), 201.162(b)(4) (1981). The Department did not challenge the subject matter or the cost effectiveness of the two Anaheim conferences. Therefore, for these two conferences, California's expenditure of Title I funds for food and lodging for those participants who lived beyond a reasonable commuting distance of the conference sites should be allowed. On remand, the Board should receive evidence to determine the number of participants who would have been required to commute more than a reasonable distance to attend these conferences, and California's reimbursement obligation should be adjusted accordingly. See 20 U.S.C. Sec. 1234d(c). For example, the auditors estimated, or perhaps knew precisely, the number of participants who attended the Anaheim conferences from the San Fernando Valley, which the Department did not claim to be within a reasonable commuting distance of Anaheim. California should not be required to reimburse the amount of food and lodging expenditures for these participants.
15 California presented to the Board projected charges that would have been incurred for a hypothetical training conference held at a District facility. These projections included four basic categories of expenses: fair market rental costs of District facilities, labor costs, food costs, and reimbursement of certain expenses incurred by conference participants. California argues it would have had to incur these costs even if the conferences had been held at District facilities; therefore, it contends, it should get a credit for these imputed costs against the amount of Title I expenditures to be reimbursed. Except for fair market rental charges for District facilities, 3 crediting California with these imputed conference expenses is supported by the Department's regulations. See 34 C.F.R. Sec. 200.60 (1981) (earlier version at 45 C.F.R. Sec. 116.36 (1980)). Such credit is also consistent with the position taken by the Secretary under analogous circumstances. See Bennett v. Kentucky Dep't of Educ., 470 U.S. 656, 661-62, 105 S.Ct. 1544, 1548, 84 L.Ed.2d 590 (1985) (Secretary reduced demanded repayment to reflect the benefits presumed to result from smaller pupil-teacher ratios in the readiness classes). On remand, the Board should receive evidence of these imputed conference expenses claimed by California, and make a determination, attributable to the seven District-sponsored conferences, of what expenses, other than imputed rent, California would have incurred had the conferences been held at District facilities. Credit for these items is appropriate.