ported under the Act, the SEA shall negotiate with local grant recipients in order to determine an adequate level of funds to be used for noninstructional purposes. (Authority: 20 U.S.C. 1203b, and 1205(c))

§ 426.41 What are the cost-sharing requirements?

(a) The Federal share of expenditures made under a State plan for any of the 50 States, the District of Columbia, and the Commonwealth of Puerto Rico may not exceed

(1) 90 percent of the costs of programs carried out with the fiscal year 1988 grant (a grant that is awarded on or after July 1, 1988 from funds appropriated in the fiscal year 1988 appropriation);

(2) 90 percent of the cost of programs carried out with the fiscal year 1989 grant (a grant that is awarded on or after July 1, 1989 from funds appropriated in the fiscal year 1989 appropriation);

(3) 85 percent of the costs of programs carried out with the fiscal year 1990 grant (a grant that is awarded on or after July 1, 1990 from funds appropriated in the fiscal year 1990 appropriation);

(4) 80 percent of the cost of programs carried out with the fiscal year 1991 grant (a grant that is awarded on or after July 1, 1991 from funds appropriated in the fiscal year 1991 appropriation); and

(5) 75 percent of the costs of programs carried out with the fiscal year 1992 grant (a grant that is awarded on or after July 1, 1992 from funds appropriated in the fiscal year 1992 appropriation) and from each grant thereafter.

(b) The Federal share for American Samoa, Guam, the Northern Mariana Islands, the Trust Territory of the Pacific Islands (Republic of Palau), and the Virgin Islands is 100 percent.

(c) The Secretary determines the non-Federal share of expenditures under the State plan by considering

(1) Expenditures from State, local, and other non-Federal sources for programs, services, and activities of adult education, as defined in the Act, made by public or private entities that receive from the State Federal funds made available under the Act or State funds for adult education; and

(2) Expenditures made directly by the State for programs, services, and activities of adult education as defined in the Act. (Authority: 20 U.S.C. 1209(a); 48 U.S.C. 1681)

§ 426.42 What is the maintenance of effort requirement?

(a)(1)(i) Basic standard. Except as provided in § 426.43, a State is eligible for a grant from appropriations for any fiscal year, only if the Secretary determines that the State

has expended for adult education from nonFederal sources during the second preceding fiscal year (or program year) an amount not less than the amount expended during the third preceding fiscal year (or program year).

(ii) The Secretary determines maintenance of effort on a per student expenditure basis or on a total expenditure basis.

(2) Meaning of "second and third preceding fiscal years (or program years)." For purposes of determining maintenance of effort, the "second preceding fiscal year (or program year)" is the fiscal year (or program year) two years prior to the year of the grant for which the Secretary is determining the State's eligibility. The "third preceding fiscal year (or program year)" is the fiscal year (or program year) three years prior to the year of the grant for which the Secretary is determining the State's eligibility.

EXAMPLE

Computation based on fiscal year. If a State chooses to use the fiscal year as the basis for its maintenance of effort computations, the Secretary determines whether a State is eligible for the fiscal year 1989 grant (a grant that is awarded on or after July 1, 1989 from funds appropriated in the fiscal year 1989 appropriation) by comparing expenditures from the second preceding fiscal year-year 1987 (October 1, 1986September 30, 1987)-with expenditures from the third preceding fiscal year-year 1986 (October 1, 1985-September 30, 1986). If there has been decrease in expenditures from fiscal year 1986 to fiscal year 1987, the State has maintained effort and is eligible for its fiscal year 1989 grant.

Computation based on program year. If a State chooses to use a program year running from July 1 to June 30 as the basis for its maintenance of effort computation, the Secretary determines whether a State is eligible for funds for the fiscal year 1989 grant by comparing expenditures from the second preceding program year-year 1987 (July 1, 1986-June 30, 1987)-with expenditures from the third preceding program yearyear 1986 (July 1, 1985-June 30, 1986). If there has been no decrease in expenditures from program year 1986 to program year 1987, the State has maintained effort and is eligible for its fiscal year 1989 grant.

(b) Expenditures to be considered. In determining a State's compliance with the maintenance of effort requirement, the Secretary considers the expenditures described in § 426.41(c).

(Authority: 20 U.S.C. 1209(b))

§ 426.43 Under what circumstances may the Secretary waive the maintenance of effort requirement?

(a) The Secretary may waive, for one year only, the maintenance of effort requirement in § 426.42 if the Secretary determines that a waiver would be equitable due to exceptional or uncontrolled circumstances. These circumstances include, but are not limited to, the following:

(1) A natural disaster.

(2) An unforeseen and precipitous decline in financial resources.

(b) The Secretary does not consider tax initiatives or referenda to be exceptional or uncontrollable circumstances.

(Authority: 20 U.S.C. 1209(b)(2))

§ 426.44 How does a State request a waiver of the maintenance of effort requirement?

An SEA seeking a waiver of the maintenance of effort requirement in § 426.42 shall

(a) Submit to the Secretary a request for a waiver; and

(b) Include in the request

(1) The reason for the request; and

(2) Any additional information the Secretary may require.

(Approved by the Office of Management and Budget under control number 18300510)

(Authority: 20 U.S.C. 1209(b)(2))

§ 426.45 How does the Secretary compute maintenance of effort in the event of a waiver?

If a State has been granted a waiver of the maintenance of effort requirement that allows it to receive a grant from appropriations for a fiscal year, the Secretary determines whether the State has met that requirement for the grant to be awarded for the year after the year of the waiver by comparing the amount spent for adult education from non-Federal sources in the second preceding fiscal year (or program year) with the amount spent in the fourth preceding fiscal year (or program year).

EXAMPLE

Because exeptional or uncontrollable circumstances prevented a State from maintaining effort in fiscal year 1987 (October 1, 1986-September 30, 1987)—or in a program year 1987 running from July 1, 1986-June 30, 1987-at the level of fiscal year 1986 (October 1, 1985-September 30, 1986)-or program year 1986 (July 1, 1985-June 30, 1986), the Secretary grants the State a waiver of the maintenance of effort requirement that permits the State to receive its fiscal year 1989 grant (a grant that is awarded on or after July 1, 1989 from funds appropriated in the fiscal year 1989 appropriation). In order to determine whether a State has met

the maintenance of effort requirement and therefore is eligible to receive its fiscal year 1990 grant (the grant to be awarded for the year after the year of the waiver), the Secretary compares the State's expenditures from the second preceding fiscal year (or program year)—fiscal year 1988 (October 1, 1987-September 30, 1988) or program year 1988 (July 1, 1987-June 30, 1988)-with expenditures from the fourth preceding fiscal year (or program year-year 1986. If the expenditures from fiscal year (or program year) 1988 are not less than the expenditures from fiscal year (or program year) 1986, the State has maintained effort and is eligible for its fiscal year 1990 grant. (Authority: 20 U.S. 1209(b)(2))

§ 426.46 What requirements for program reviews and evaluations must be met by a State? (a) An SEA shall provide for program reviews and evaluations of all State-administered adult education programs, services, and activities it assists under the Act. The SEA shall use its program reviews and evaluations to assist LEAS and other recipients of funds in planning and operating the best possible programs of adult education and to improve the State's programs of adult education.

(b) In reviewing programs, an SEA shall, during the four-year period of the State plan, gather and analyze data on the effectiveness of all State-administered adult education programs, services, and activities-including standardized test data-to determine the extent to which

(1) The State's adult education programs are achieving the goals in the State plan, including the goal of serving educationally disadvantaged adults; and

(2) Grant recipients have improved their capacity to achieve the purposes of the Act.

(c)(1) An SEA shall, during the four-year period of the State plan, evaluate in qualitative and quantitative terms the effectiveness of programs, services, and activities conducted by at least one-third of the local recipients of funds.

(2) The recipients the State evaluates must be representative of all recipients in the State.

(3) An evaluation must consider the following factors:

(i) Planning and content of the programs, services, and activities.

(ii) Curriculum, instructional materials, and equipment.

(iii) Adequacy and qualifications of all personnel.

(iv) Effect of the program on the subsequent work experience of participants, completers, and graduates.

(v) Achievement of the goals set forth in the State plan.

(vi) Extent to which educationally disadvantaged adults are being served.

(vii) Extent to which local recipients of funds have improved their capacity to achieve the purposes of the Act.

(viii) Other factors that affect program operations, as determined by the SEA.

(d)(1) Within 90 days of the close of each program year, the SEA shall submit the following to the Secretary:

(i) The information in § 426.10(b)(10). (ii) A report on the SEA's activities under paragraph (b) of this section.

(iii) A report on the SEA's activities under paragraph (c) of this section.

(2) The reports described in paragraphs (d)(1) (ii) and (iii) of this section must include

(i) The results of any program reviews and evaluations performed during the program year, and a description of how the SEA used the program review and evaluation process to make necessary changes to improve programs; and

(ii) The comments and recommendations of the State advisory council, if a council has been established.

(e) If an SEA has established a State advisory council on adult education under § 426.50, the SEA shall

(1) Obtain approval of the plan for program reviews and evaluations from the State advisory council; and

(2) Inform the State advisory council of the results of program reviews and evaluations so that the State advisory council may perform its duties under section 332(f)(3) of the Act.

NOTE TO § 426.46: In addition to the Adult Education State-administered Basic Grant Program in this part 426, State-administered adult education programs include the State-administered Workplace literacy Program (See 34 CFR part 433) and the Stateadministered English Literacy Program (See 34 CFR part 434).

(Approved by the Office of Management and Budget under control number 18300510)

(Authority: 20 U.S.C. 1205a(f)(3) and 1207a)

Subpart F-What are the Administrative
Responsibilities of a State?

§ 426.50 What are a State's responsibilities regarding a State advisory council on adult education?

(a) A State that receives funds under section 313 of the Act may

(1) Establish a State advisory council; or (2) Designate an existing body as the State advisory council.

(b) If a State elects to establish or designate a State advisory council on adult education, the following provisions apply:

(1) The State advisory council must comply with §§ 426.51 and 426.52.

(2) The Governor appoints members to the State advisory council in accordance with section 332(e) of the Act.

(3) Costs incurred for a State advisory council must be counted as part of the allowable State-administrative costs under

the Act.

(4) The Governor determines the amount of funding available to a State advisory council.

(5)(i) A State advisory council determines its own staffing needs, within the budget established by the Governor.

(ii) A State advisory council's staffing may include professional, technical, and clerical personnel as may be necessary to enable the council to carry out its functions under the Act.

(6) Members of a State advisory council and its staff, while serving on the business of the council, may receive subsistence, travel allowances, and compensation in accordance with State law and regulations and State practices applicable to persons performing comparable duties and services. (Authority: 20 U.S.C. 1205a (a), (d), (e))

§ 426.51 What are the membership requirements of a State advisory council on adult education?

(a)(1) The membership of a State advisory council may broadly represent citizens and groups within the State having an interest in adult education. The council must consist of representatives of

(i) Public education;

(ii) Private and public sector employment; (iii) Recognized State labor organizations; (iv) Private, voluntary, or community literacy organizations;

(v) Libraries; and

(vi) State economic development agencies. (2) The State shall ensure that there is appropriate representation on the State advisory council of—

(i) Urban and rural areas;

(ii) Women;

(iii) Persons with handicaps; and

(iv) Racial and ethnic minorities. (b)(1) An SEA shall certify to the Secretary the establishment of, and membership of, its State advisory council.

(2) The certification must be submitted to the Secretary prior to the beginning of any program year in which the State desires to receive a grant under the Act.

(c) Members must be appointed for fixed and staggered terms and may serve until their successors are appointed. Any vacancy in the membership of the council must be filled in the same manner as the original appointment. Any member of the council may

be removed for cause in accordance with procedures established by the council. (Approved by the Office of Management and Budget under control number 18300510)

(Authority: 20 U.S.C. 1205a (a)(1), (b), and (c))

§ 426.52 What are the responsibilities of a State advisory council on adult education? (a)(1) The State advisory council shall, using procedures agreed upon, elect a chairperson.

(2) The State advisory council shall adopt rules that govern the number, time, place, and conduct of meetings as well as council operating procedures. The rules must provide for at least one public meeting each year at which the general public is given an opportunity to express views concerning adult education programs in the State.

(b) A State advisory council shall

(1) Meet with the SEA or its representative during the planning year to advise on the development of the State plan;

(2) Review the State plan before it is submitted to the Secretary and, if the State advisory council has substantial disagreement with the final State plan, file timely objections with the SEA;

(3) Advise the SEA on

(i) Policies the State should pursue to strengthen adult education; and

(ii) Initiatives and methods the private sector could undertake to assist the State's improvement of adult education programs;

and

(4)(i) Approve the plan for the program reviews and evaluations required in section 352 of the Act and § 426.46 and participate in implementing and disseminating the program reviews and evaluations. In approving the plan for the program reviews and evaluations, the State advisory council shall ensure that persons knowledgeable of the daily operation of adult education programs are involved;

(ii) Advise the Governor, the State legislature, and the general public of the State with respect to the findings of the program reviews and evaluations; and

(iii) Include in any reports of the program reviews and evaluations the council's comments and recommendations.

(Approved by the Office of Management and Budget under control number 18300510)

(Authority: 20 U.S.C. 1205a (d) and (f), 1206a(a)(3)(B))

§ 462.2 Who is eligible for an award?

(a) A State educational agency (SEA) is eligible for an award if the Secretary has approved the State plan and application submitted in accordance with section 342 of the Act and 34 CFR 426.10 through 426.13, and the State plan meets the requirements in § 462.10.

(b) If a State is ineligible to receive its allotment under this program, the Secretary uses the State's allotment to make direct grants to applicants in that State who are qualified to teach literacy skills needed in the workplace. To make those awards, the Secretary uses the procedures described for the National Workplace Literacy Program in 34 CFR part 432.

(Authority: 20 U.S.C. 1211(b) (3), (6))

§ 462.3 What kinds of activities may be assisted?

(a) Under the State-administered Workplace Literacy Program the Secretary makes allotments to an SEA to pay the Federal share of the cost of adult education programs that teach literacy skills needed in the workplace through partnerships between the entities in § 462.30(a) (1) and (2).

(b) A State shall assist partnership projects that are designed to improve the productivity of the workforce through improvement of literacy skills needed in the workplace through the activities described in 34 CFR 432.3 (a) through (f).

(Authority: 20 U.S.C. 1211(b) (4), (5))

§ 462.4 What regulations apply?

The following regulations apply to the State-administered Workplace Literacy Program:

(a) The regulations in this part 462. (b) The regulations in 34 CFR part 425.

(Authority: 20 U.S.C. 1211(b))

§ 462.5 What definitions apply?

(a) The definitions in 34 CFR 432.5 apply to this part.

(b) The following definition also applies to this part:

Partner means an entity included in the list of entities in § 462.30(a) (1) or (2).

(Authority: 20 U.S.C. 1211(b))

Subpart B-How Does a State Apply for a Grant?

§ 462.10 What must the State plan contain?

To receive a grant under the Stateadministered Workplace Literacy Program, an SEA shall include in its State plan, submitted to the Secretary in accordance with 34 CFR 426.10, a description of

(a) The requirements for State approval of funding of a local workplace literacy project;

(b) The procedures under which applications for that funding may be submitted; and

(c) The method by which the SEA will obtain an annual third-party evaluation of student achievement in, and the overall effectiveness of the services provided by, all projects that receive funding from the State's grant under the State-administered Workplace Literacy Program.

(Approved by the Office of Management and Budget under control number 18300026)