(2) The State educational agency's application to the Commissioner under this part was effective.

(c) Notice and opportunity for hearing. The State educational agency may not finally disapprove a local educational agency's application in whole or in part without first affording the local educational agency reasonable notice and opportunity for a hearing with respect to its action in accordance with the requirements of section 425(a) of the General Education Provisions Act. The State educational agency shall include in its notice the reasons for the proposed disapproval. The State educational agency shall hold a hearing within 30 days after it receives a written request from the local educational agency. If the State educational agency decides not to rescind its final action, it shall give notice of the decision to the local educational agency in writing, stating its reasons and indicating the local educational agency's right to appeal to the Commissioner under section 425(b) of the General Education Provisions Act withing 20 days of the receipt of the notice.

(Pub. L. 94-405, Section 202(a); 20 U.S.C. 1231b-2)

Subpart F-Records and Reports Required by the Commissioner

§ 122a.24 Records required of State and local educational agencies.

(a) State educational agencies. A State educational agency which has received a grant under this part shall maintain adequate written records showing that it has satisfied the requirements of § 122a.10 regarding the use of funds paid to it for the adminstration of the program.

(b) Local educational agencies. The State educational agency shall require each local educational agency which has received a subgrant under this part to maintain adequate written records to substantiate that it has satisfied the requirements governing eligibility, entitlement, and use of funds, which are contained in Subparts D and G, including those requirements arising from the assurances given. These records must document on an

individual basis that each Indochinese refugee child counted and served under this part is an Indochinese refugee child as defined in Pub. L. 94-405, Title II. The records must reflect the identity of the children by name, address and alien registration number or copy of the immigration document displaying this number.

(20 U.S.C. 1232c(a))

§ 122a.25 Retention of records.

State and local educational agencies receiving payments under this part are required to keep all records supporting the application until the completion of the administrative reviews which are regularly conducted by Federal agencies, or for five years following the fiscal year to which the application relates. The records involved which have been questioned must be further maintain until necessary adjustments have been made, and the adjustments have been reviewed and cleared by the Federal agencies making these reviews. (20 U.S.C. 1232c(a))

§ 122a.26 Annual performance report by State educational agency.

Each State educational agency receiving financial assistance under this part shall make the annual performance report as required by § 100b.432 of Part 100b of this chapter to the Commissioner, withing 90 days after the end of the grant period. The State educational agency in its report shall include (in addition to the information required by Part 100b), information showing:

(a) The number of Indochinese refugee children who during the grant period, received public educational services in each local educational agency in the State, including both public and nonpublic school children;

(b) A description of the services provided by the local educational agencies to Indochinese refugee children through the use of funds received under this part; and

(c) Other information the Commissioner may require.

(20 U.S.C. 1232c(b)(1)(A)(III))

Subpart G-Use of Funds

§ 122a.27 General.

Each educational agency shall use payments made to it under this part in accordance with an application approved under Pub. L. 94-405 section 205 for public educational services for Indochinese refugee children enrolled in the schools of the local educational agency and enrolled in elementary and secondary nonpublic schools within the district served by that local educational agency.

(Pub. L. 94-405, Sections 203 and 205)

§ 1228.28 Public educational services to be provided during period of obligation. Each application by a local educational agency to a State educational agency for a subgrant under this part must contain an assurance that the applicant has or will (as a condition of receiving the grant) in the period from July 1, 1976 through September 30, 1978 make available public educational services to all Indochinese refugee children who are counted under § 122a.21(b)(5), including the nonpublic school children who are counted. (Pub. L. 94-405, Section 203)

§ 122a.29 Use of funds for public school children.

The public educational services provided under this part to Indochinese refugee children enrolled in public elementary and secondary schools may include basic educational services and such supplementary English language instruction and other educational services as are necessary to enable the children to achieve a satisfactory level of educational performance.

(Pub. L. 94-405, Section 203)

§ 122a.30 Comparable services required

for children enrolled in public schools. The State educational agency shall require a local educational agency, as a condition of entitlement to payments under this part, to assure the State educational agency in its application that all Indochinese refugee children to whom it provides public educational services under this part have access during the grant period to

(b) Restrictions on use of funds. The use of funds provided under this part for children enrolled in nonpublic schools is subject to the restrictions set forth in section 205(a)(6) of Pub. L. 94-405, and in addition to the following restrictions:

(1) The use of these funds may not include financing the basic level of instruction which is provided by the nonpublic school to its students, but is limited to financing the supplemental services referred to in paragraph (a) of this section;

(2) The use of these funds may not include the payment of salaries for teachers or other employees of nonpublic schools except for services performed outside their regular hours of duty and under public supervision and control;

(3) The use of these funds may not include acquisition or use of equipment other than mobile or portable equipment on nonpublic school premises, or the construction of nonpublic school facilities.

(Pub. L. 94-405, Section 205(a)(6); Lemon v. Kurtzman, 403 U.S.C. 602 (1971))

§ 122a.32 Waiver of requirement for participation of nonpublic school children. (a) Conditions for waiver. If a State is prohibited by law from providing public educational services to Indo

chinese refugee children enrolled in elementary and secondary nonpublic schools, as required by Pub. L. 94-405, section 205(a)(6) and the relevant provisions of this part, the Commissioner may waive this requirement and shall arrange for the provision of services to those children through arrangements which are subject to the requirements of Title II of Pub. L. 94-405, and of this part. For the purpose of determining whether a State is prohibited by law from providing public educational services for Indochinese refugee children enrolled in nonpublic schools, the Commissioner may require the State educational agency to furnish an opinion of the Attorney General of the State with regard to the status of State law governing participation.

(b) Cost of arrangements by Commissioner. When the Commissioner arranges for services pursuant to this section, the Commissioner may after consutation with the appropriate public and nonpublic school officials, use to defray the cost of the arrangement, the amount to which the State educational agency of that State would have been entitled to obligate under this part if the children to be served by the arrangement had been counted and afforded the opportunity to be served by the local educational agencies of that State in accordance with the requirements of Pub. L. 94405, section 206(c).

(Pub. L. 94-405, Section 206(c))

APPLICABILITY; DEFINITIONS

Sec. 201. (a) The provisions of this title shall be applicable for the period beginning July 1, 1976, and ending September 30, 1977. (b) As used in this title

(1) The term "Commissioner" means the Commissioner of Education.

(2) The term "elementary schools" means a day or residential school which provides elementary education, as determined under State law.

(3) The term "Indochinese refugee children" means children who are refugees within the meaning of that term as defined in section 3 of the Indochina Migration and Refugee Assistance Act of 1975.

(4) The term "local educational agency" means a public board of education or other

public authority legally constituted within a State for either administrative control 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 also includes any other public institution or agency having administrative control and direction of a public elementary or secondary school.

(5) The term "secondary school" means a day or residential school which provides secondary education, as determined under State law.

(6) The term "State" includes, in addition to the several States of the Union, the Commonwealth of Puerto Rico, the District of Columbia, Guam, American Samoa, the Virgin Islands, and the Trust Territory of the Pacific Islands.

(7) The term "State educational agency" means the State board of education or other agency or officer primarily responsible for the State supervision of public elementary and secondary schools, or if there is no such officer or agency, an officer or agency designated by the Governor or by State law.

(8) The term "elementary or secondary nonpublic schools" means schools which comply with the compulsory education laws of the State and which are exempt from taxation under section 501(c)(3) of the Internal Revenue Code.

STATE ENTITLEMENTS

Sec. 202. (a) The Commissioner shall, in accordance with the provisions of this title, make payments to State educational agencies for the period July 1, 1976, through September 30, 1977, for the purposes set forth in section 203.

(b)(1) Except as provided in subsection (d) of this section, the maximum amount of the grant to which a State educational agency is entitled under this title, for the period beginning July 1, 1976, and ending September 30, 1977, shall be equal to the sum of

(A) The number of Indochinese refugee children aged 5 to 17, inclusive, receiving public educational services under the supervision of each local educational agency within that State during the period for which the determination is made; multiplied by

(B) The lesser of

(i) $300 for each of the first one hundred such children who are furnished such services under the supervision of each local educational agency within such State, or

(ii) If the number of such children equals or exceeds 1 per centum of the total number of children enrolled in the schools of that

agency, $300 for each such child in such 1 per centum who is furnished such services under the supervision of each local educational agency within such State; and

(C) $600 for each additional such child in excess of one hundred such children, or in excess of such 1 per centum, as the case may be, being furnished such services under the supervision of that agency.

(2) For the purpose of this subsection, the term "State" does not include American Samoa, the Virgin Islands, and the Trust Territory of the Pacific Islands.

(c)(1) The jurisdictions to which this subsection applies are American Samoa, the Virgin Islands, and the Trust Territory of the Pacific Islands.

(2) Each jurisdiction to which this subsection applies shall be entitled to a grant for the purposes set forth in section 203 in an amount equal to an amount determined by the Commissioner in accordance with criteria established by him, except that the aggregate of the amount to which such jurisdictions are so entitled for any period shall not exceed an amount equal to 1 per centum of the aggregate of the amounts to which all States are entitled under subsection (b) of this section for that period. If the aggregate of the amounts, determined by the Commissioner pursuant to the preceding sentence, to be so needed for any period exceeds an amount equal to such 1 per centum limitation, the entitlement of each such jurisdiction shall be reduced proportionately until such aggregate does not exceed such 1 per centum limitation.

(d) Notwithstanding any other provision of this section, no State educational agency shall be entitled to receive a grant for any period in excess of the amount equal to the amount to which such agency would otherwise be entitled under this section for that period minus the sum of the amounts received by the local educational agencies of the State and by that State educational agency for that period under the Indochina Migration and Refugee Assistance Act of 1975.

(e) Determinations with respect to the number of Indochinese refugee children by the Commissioner under this section or any period shall be made, whenever actual satisfactory data are not available, on the basis of estimates. No such determination shall operate, because of an underestimate, to deprive any State educational agency of its entitlement to any payment (or the amount thereof), under this section to which such agency would be entitled had such determination been made on the basis of accurate data.

USES OF FUNDS

Sec. 203. Payments made under this title to any State may be used in accordance with

applications approved under section 205 for public educational services for Indochinese refugee children in the schools of the local educational agencies of that State and in elementary and secondary nonpublic schools of that State.

ALLOCATION OF APPROPRIATIONS

Sec. 204. (a) If the sums appropriated for the period from July 1, 1976, to September 30, 1977, for making the payments provided for in this title are not sufficient to pay in full the total amounts which State educational agencies are entitled to receive under this title for such period, the allocations to such State educational agencies shall be ratably reduced to the extent necessary to bring the aggregate of such allocations within the limits of the amount so appropriated.

(b) In the event that funds become available for making payments under this title for such period after allocations have been made under subsection (a) for that period, the amounts reduced under subsection (a) shall be increased on the same basis as they were reduced.

APPLICATIONS

Sec. 205. (a) No State educational agency shall be entitled to any payment under this title for any period unless that agency submits an application to the Commissioner at such time, in such manner, and containing or accompanied by such information, as the Commissioner may reasonably require. Each such application shall—

(1) Provide that the educational programs, services, and activities for which payments under this title are made will be administered by or under the supervision of the agency;

(2) Provide that payments under this title will be used for purposes set forth in section 203;

(3) Provide assurances that such payments will be distributed among local educational agencies within that State in accordance with sections 202(b)(1) and 202(d);

(4) Provide assurances that the State educational agency will not finally disapprove in whole or in part any application for funds received under this title without first affording the local educational agency submitting an application for such funds reasonable notice and opportunity for a hearing;

(5) Provide for making periodic reports to the Commissioner evaluating the effectiveness of the payments made under this title, and such other reports as the Commissioner may reasonably require to perform his functions under this title; and

(6) Provide assurances

(i) That to the extent consistent with the number of Indochinese refugee children en

rolled in the elementary or secondary nonpublic schools within the district served by a local educational agency, such agency, after consultation with appropriate officials of such schools, shall provide for the benefit of these children secular, neutral, and nonideological services, materials, and equipment necessary for the education of such children;

(ii) That the control of funds provided under this paragraph and title to materials, equipment, and property repaired, remodeled, or constructed therewith shall be in a public agency for the uses and purposes provided in this title, and a public agency shall administer such funds and property; and

(iii) That the provision of services pursuant to this paragraph shall be provided by employees of a public agency or through contract by such public agency with a person, association, agency, or corporation who or which, in the provision of such services, is independent of such elementary or secondary nonpublic school and of any religious organization; and such employment or contract shall be under the control and supervision of such public agency, and the funds provided under this paragraph shall not be commingled with State or local funds.

(b) The Commissioner shall approve an application which meets the requirements of subsection (a). The Commissioner shall not finally disapprove an application of a State educational agency except after reasonable notice and opportunity for a hearing on the record to such agency.

PAYMENTS

Sec. 206. (a) The Commissioner shall pay to each State educational agency having an application approved under section 205 the amount which that State is entitled to receive under this title.

(b) The Commissioner is authorized to pay to each State educational agency amounts equal to the amounts expended by it for the proper and efficient administration of its functions under this title, except that the total of such payments for any period shall not exceed 1 per centum of the amounts which that State educational agency is entitled to receive for that period under this title.

(c) If a State is prohibited by law from providing public educational services for children enrolled in elementary and secondary nonpublic schools, as required by section 205(a)(6), the Commissioner may waive such requirement and shall arrange for the provision of services to such children through arrangements which shall be subject to the requirements of this title.

WITHHOLDING

Sec. 207. Whenever the Commissioner, after reasonable notice and opportunity for a hearing to any State educational agency, finds that there is a failure to meet the requirements of this title, the Commissioner shall notify that agency that further payments will not be made to the agency under this title, or in his discretion, that the State educational agency shall not make further payments under this title to specified local educational agencies (whose actions cause or are involved in such failure) until he is satisfied that there is no longer any such failure to comply. Until he is so satisfied, no further payments shall be made to the State educational agency under this title or payments by the State educational agency under this title shall be limited to local educational agencies whose actions did not cause or were not involved in the failure, as the case may be.