der Title VI of the Act shall provide for keeping accessible and intact all records supporting claims for Federal funds under Title VI of the Act or relating to the accountability of the grantee for the expenditure of such funds:

(1) For 3 years after the close of the fiscal year in which the expenditure was made; or

(2) Until the State educational agency is notified that such records are not needed for administrative review, whichever is the later.

(b) Questioned expenditure. The records involved in any claim or expenditure which has been questioned shall be further maintained until necessary adjustments have been made and such adjustments have been reviewed and approved by the Department of Health, Education, and Welfare.

§ 121.33 Inventories of equipment.

(a) Each State and local educational agency shall maintain an inventory of all equipment acquired with funds under Title VI of the Act and placed in the temporary custody of persons in a private school. Such inventories shall be maintained until the equipment is discharged from such custody, and, if costing $100 or more per unit, for the expected useful life of the equipment or until its disposition.

(b) Each State educationa' agency and each local educational agency shall maintain inventories of all other equipment acquired by it with funds under Title VI of the Act, and costing $100 or more per unit, for the expected useful life of the equipment or until its disposition.

(c) The records of inventories required by this section shall be subject to the retention requirements of § 121.32.

(d) All proceeds from the sale of property for which an inventory is being maintained pursuant to the provisions of this section, and the net proceeds from the rental of such property, shall be credited to the Federal Government.

§ 121.34 Adjustments.

The State agency in its maintenance of program expenditure accounts, records, and reports shall promptly make any necessary adjustments in its records to reflect refunds, credits, underpayments, or overpayments, as well as any adjustments resulting from Federal or State administrative reviews and audits. Such adjustments shall be set forth in

the State agency's financial reports filed with the Commissioner.

§ 121.35 Financial interest of officials.

No board or staff member of a State or local educational agency may participate in an administrative decision with respect to a program or project under Title VI of the Act if such a decision can be expected to result in any benefit or remuneration, such as a royalty, commission, contingent fee, brokerage fee, or other benefit, to him or any member of his immediate family.

§ 121.36 Copyrights and patents.

(a) Any material of a copyrightable nature produced with financial assistance under Title VI of the Act shall be subject to such copyright policy of the U.S. Office of Education as is in effect at the time.

(b) Any materials of a patentable nature produced through a project with financial assistance under Title VI of the Act shall be subject to the provisions of 45 CFR Parts 6 and 8.

Subpart D-Payment Procedures § 121.41 Financial reports.

Each State agency shall submit, in accordance with procedures established by the Commissioner:

(a) Following the end of the fiscal year, a report of the total expenditures made under the State plan during the fiscal year; and

(b) Such other reports as are needed. § 121.42 Payments of funds under Title VI of the Act.

Funds paid under Title VI of the Act for amounts expended by a State to carry out its State plan will be limited to the amount necessary to meet current needs for disbursement.

§ 121.43 Withholding of funds.

Neither the approval of the State plan nor any payment to the State pursuant thereto shall be deemed to waive the right or duty of the Commissioner to withhold funds by reason of the failure of the State to observe, before or after such administrative action, any Federal requirements.

§ 121.44 Reallotment.

(a) General. The amount of any State's allotment under Title VI of the Act for any fiscal year which the Commissioner determines will not be required

for such fiscal year shall be available for reallotment, from time to time, on such dates during such year as the Commissioner may fix, to other States in proportion to the original allotments to I such States under Title VI of the Act for that year but with such proportionate amount for any of such other States beIing reduced to the extent it exceeds the I sum the Commissioner estimates such State needs and will be able to use for such years and the total of such reductions shall be similarly reallotted among the States whose proportionate amounts were not so reduced.

(b) Statements of anticipated need. In order to provide a basis for reallotment by the Commissioner under Title VI of the Act, each State agency administering a program under Title VI of the Act shall, if requested, submit to the Commissioner by such date or dates as he may specify a statement or statements showing the anticipated need during the current fiscal year for the amount previously allotted, or any amount needed to be added thereto. The statement or statements shall contain such further information as the Commissioner may request for the purpose of making reallotments.

86-096-68- -20

130.90

130.91

Condition precedent to receiving Federal funds.

Special limitations on use of funds. Submission of reports.

Effect of Federal payments.

Noncompliance.

130.92 Right to hearing and judicial review. 130.93 Termination of program.

130.94 Transition provisions.

AUTHORITY:

The provisions of this Part 130 issued under sec. 8, 70 Stat. 295, as amended and renumbered sec. 302, 78 Stat. 14, as further amended and renumbered sec. 502, 80 Stat. 317, 20 U.S.C. 357.

SOURCE: The provisions of this Part 130 appear at 32 F.R. 2946, Feb. 16, 1967, unless otherwise noted.

§ 130.1

Subpart A-Definitions

Definitions.

As used in this part:

(a) "Act" means the Library Services Act, Public Law 84-597, as amended by Public Law 84-896; Public Law 86-679; Public Law 87-688; Public Law 88-269 (as renamed, the Library Services and Construction Act); and Public Law 89511 (20 U.S.C. Chap. 16).

(b) "Commissioner" means the U.S. Commissioner of Education.

(c) "Department" means the U.S. Department of Health, Education, and Welfare.

(d) "Geographic area(s)," for the purpose of subpart C, means all or part

and curricular information had been analyzed and disseminated before; or (3) by adopting a new and different type of analysis of processing, makes use of information hitherto collected for an entirely new and different purpose, e.g., the use of electronic equipment to analyze and show the relationship between educational progress and attendance, or health, or physical training, or participation in organized sports, or certain types of physical handicaps of children, or the social or educational background of teachers, etc. An evaluative study undertaken in connection with the State plan to determine ways of improving the State agency's program for providing educational statistics may also qualify as a new program within the meaning of this section.

(b) Addition or expansion. An addition to or expansion of an existing program is a plan of operations, and the activities to carry out such plan, which involve additional expenditures by the State educational agency for statistical services of the types set forth in section 1009 (b) of the Act, over and above those hitherto expended for like services, and does one or more of the following: (1) provides for collecting and disseminating increased amounts of data about educational areas in which the agency is already making data available; (2) provides for recording, collecting, or disseminating types of data about educational areas in which such types of data are not available; (3) increases the usefulness of educational data by making it more current; (4) increases the usefulness of educational data by improving its quality; or (5) increases the usefulness of collected data through improved analysis. (See also § 140.10.)

(c) Time basis for measurement. Whether a program is "new" or an "addition to" or "expansion of" an existing program will, for the fiscal year 1959, be measured against the activities being carried on by the State educational agency prior to September 2, 1958. For programs submitted for approval after fiscal year 1959, such improvement or increase will be measured against the activities being carried on by the State educational agency prior to the first day of the fiscal year in which the program was submitted for approval.

§ 140.4 State agency for administration. (a) Designation. The State plan shall give the official name of the agency

which will be the sole agency for administering the plan. Such agency shall meet the criteria set forth in § 140.1(e) defining "State educational agency."

(b) Organization. The State plan shall indicate the administrative unit(s) within the State agency that will be responsible for administering the program(s) set forth in the plan.

§ 140.5 Authority of State agency.

The State plan shall set forth the authority of the State agency under State law to submit the State plan and to administer the program(s) set forth therein. Citations to, or copies of, all directly pertinent statutes and interpretations of them by the appropriate State officials, whether by regulations, policy statements, opinions of the Attorney General, or court decisions, shall be furnished as a part of the plan. All copies must be certified as correct by an appropriate official.

§ 140.6 Custody of funds.

The State plan shall designate the officer who will receive and provide for the custody of funds to be expended under applicable State laws and regulations on requisition or order of the State agency.

(a) Fiscal administration. The State plan shall describe the fiscal administration of the plan. Such administration shall be conducted in accordance with applicable State laws, policies, and procedures, which shall be identified in the plan or set forth in an appendix. Accounts and supporting documents relating to any program involving Federal participation shall be adequate to permit an accurate and expeditious audit of the program.

(b) Disposal of records. The State educational agency shall provide for keeping accessible and intact all records supporting claims for Federal grants or relating to the accountability of the grantee agency for expenditure of such grants and relating to the expenditure of matching funds: (1) For three years after the close of the fiscal year in which the expenditure was made by the State educational agency; or (2) until the State agency is notified that such records are not needed for program administration review; or (3) until the State agency is notified of the completion of

the Department's fiscal audit, whichever is later.

(c) Questioned expenditure. The records involved in any claim or expenditure which has been questioned shall be further maintained until necessary adjustments have been made and the adjustments have been reviewed and cleared by the Department.

Where (d) Records of equipment. nonconsumable equipment which costs $10 or more per unit is purchased by the State with Federal financial participation, inventories and other records supporting accountability shall be maintained until the State agency is notified of the completion of the Department's review and audit covering the disposition of such equipment.

The State plan shall provide that the State agency will participate in such periodic consultations and will make such reports to the Commissioner, at such time, in such form, and containing such information as the Commissioner may consider reasonably necessary to enable him to perform his duties under section 1009, and will comply with such provisions as he may find necessary to assure the correctness and verification of such reports.

Subpart C-Federal Financial
Participation and Payment

§ 140.9 Federal participation.

Section 1009 authorizes payment of one-half (not to exceed $50,000 for each fiscal year) of the total sum expended by the State under the State plan. Such expenditures may include salaries and wages, purchase of equipment, rental of equipment, conferences and workshops, travel, printing and reproduction, and other expenditures that may be readily identified as having been made pursuant to the State plan and within the provisions and limitations of section 1009 and the regulations in this part. Federal financial participation will be available in expenditures made in accordance with the provisions of the State plan and the applicable State laws, rules, and regulations, and standards governing the use of State funds.

§ 140.10 Proration of costs.

Federal participation is available only with respect to that portion of any ex

penditure which is attributable to the new, added, or expanded aspects of a program under the State plan. The State plan shall specify the basis for identifying and prorating expenditures not attributable solely to such plan activities.

§ 140.11

Effective date of plan.

Since the Federal Government participates only in amounts expended under the State plan, there can be no Federal participation in any expenditures made before the plan is in effect. For the purposes of this section the earliest date on which a plan may be considered to be in effect is the date on which it is received in substantially approvable form by the Commissioner.

§ 140.12 Use of State rule in determining the fiscal year's allotment to which an expenditure is chargeable. Each allotment to a State under section 1009 of the Act is made with respect to a fiscal year commencing on July 1 and ending the following June 30. State laws and regulations shall be followed by the States in determining to which fiscal year an expenditure by the State educational agency is chargeable for the purpose of earning the allotment. Each State, therefore, shall use the accounting basis (cash, accrual or obligation) applicable to its State accounting. § 140.13

Submission of annual estimates and reports.

(a) For each Federal fiscal year, the State agency shall submit upon forms prescribed and in accordance with procedures established by the Commissioner (1) a description of the specific activities to be carried out for that year in connection with each program set forth in the plan, and (2) a statement of the estimated sources of funds and expenditures to be made in carrying out the activities for the fiscal year. Expenditures which deviate from the details of the estimate will not be precluded from Federal participation if otherwise made in accordance with the approved plan and the regulations in this part.

(b) Following the end of each Federal fiscal year, the State agency shall submit upon forms prescribed and in accordance with procedures established by the Commissioner a report of the total expenditures and obligations made under the plan during the fiscal year.

to such construction projects, and shall cite the authority under State and local laws, rules, and regulations.

(h) Reports. The State plan shall provide that the State agency will make and submit to the Commissioner the reports described in § 130.89 of this part; and that the State agency will maintain records in support thereof as required under § 130.85.

(i) Amendment. The State plan shall provide that it will be amended to reflect any material changes in the library program(s) provided for by such plan, any changes in pertinent State law, or any changes in the organization of, operations of, or policies and methods of administration to be followed by, the State agency; and that amendments will be submitted and certified in the same manner as the State plan.

(j) Certification of the State plan(1) Certification by State agency. The State plan and all amendments thereto shall include a certification by the officer of the State agency authorized to submit the State plan that the plan or amendment has been adopted by the State agency and that the plan, or plan as amended, will constitute the basis for operation and administration (including, where applicable, supervision of the administration) of the library programs in which there is Federal financial participation.

(2) Certification by State Attorney General. The State plan and all amendments thereto shall include a certification by the State's Attorney General, or other official designated in accordance with State law to advise the State agency on legal matters, that all plan provisions and amendments thereto are consistent with State law. He shall further certify the official title of the officer authorized to submit the State plan; that the State agency named in the plan has authority under State law to submit the State plan and to administer or supervise the administratiion of the plan, whichever is applicable; that the State Treasurer (or, if there be no State Treasurer, the officer identified by title exercising similar functions for the State) has authority under State law to receive, hold, and disburse Federal funds under the State plan. There shall be included as part of the plan copies of, or citations to, all pertinent laws and interpretations of laws by appropriate State officials or courts relevant to the State plan provi

sions. All such copies or citations shall be certified to be correct by the Attorney General or other appropriate State official.

Subpart C-Public Library Services § 130.13 State plan requirements— Title I.

(a) Policies, methods and purposes. The State plan shall contain a statement describing the policies and methods of administration to be followed by the State agency in using funds made available under its allotment for expenditure under the State plan. The State agency shall certify that its policies and methods of administration will, in its judgment, assure use of such funds to maximum advantage in the further extension of public library services to geographic areas (1) without such services or (2) with inadequate services. This statement shall describe the immediate and longrange plans of the State agency in establishing or extending public library services.

(b) Priorities and criteria for improving public library services. The State plan shall set forth the criteria to be used by the State agency for determining, pursuant to section 103(c) of the Act, whether library services are unavailable or inadequate in any geographic area and the priorities which the State agency will apply in approving participation in the program.

Subpart D-Public Library
Construction

§ 130.25

State plan requirements— Title II.

(a) Criteria, priorities, and procedures. The State plan shall set forth criteria, priorities, and procedures for approval of projects for construction of public library facilities which are designed to insure that facilities will be constructed to serve areas, as determined by the State agency, which are without library facilities necessary to develop library services. The State plan shall include a statement as to the period of time within which construction contracts shall be entered into following the State agency's approval of projects.

(b) State hearing. The State plan shall contain the State agency's assurance that every local or other public agency whose application for funds under the plan with respect to a project for construction of public library facil