served not later than 10 days prior to the hearing and a copy thereof shall be filed with the presiding officer.

(g) Notice of intention to appear. The recipient and any other party which has a right or has been granted permission to participate in the hearing shall give written confirmation to OEO of its intention to appear at the hearing 3 days before it is scheduled to occur. Failure to do so may, at the discretion of the presiding officer, be deemed a waiver of the right to a hearing.

(h) Form and date of service. All papers and documents filed or sent to a party shall be signed in ink by the appropriate party or his authorized representative. The date on which papers are filed shall be the day on which the papers or documents are deposited, postage prepaid in the U.S. mail, or are delivered in person: Provided however, That the effective date of the notice that there appear to be grounds which warrant terminating assistance shall be the date of its delivery or attempted delivery at the recipient's last known address as reflected in the records of OEO.

(i) Prehearing conferences. Prior to the commencement of a hearing the presiding officer may, subject to the provisions of paragraph (b)(2), of this section, require the parties to meet with him or correspond with him concerning the settlement of any matter which will expedite a quick and fair conclusion of the hearing.

(j) Evidence. Technical rules of evidence shall not apply to hearings conducted pursuant to this subpart, but the presiding officer shall apply rules or principles designed to assure production of relevant evidence and to subject testimony to such examination and crossexamination as may be required for a full and true disclosure of the facts. The presiding officer may exclude irrelevant, immaterial, or unduly repetitious evidence. A transcript shall be made of the oral evidence and shall be made available to any participant upon payment of the prescribed costs. All documents and other evidence submitted shall be open to examination by the parties and opportunity shall be given to refute facts and arguments advanced on either side of the issues.

(k) Depositions. If the presiding officer determines that the interests of justice would be served, he may authorize the taking of depositions provided that all parties are afforded an opportunity

to participate in the taking of the depositions. The party who requested the deposition shall arrange for a transcript to be made of the proceedings and shall upon request, and at his expense, furnish all other parties with copies of the transcript.

(1) Official notice. Official notice may be taken of a public document, or part thereof, such as a statute, official report, decision, opinion or published scientific data issued by any agency of the Federal Government or a State or local government and such document or data may be entered on the record without further proof of authenticity. Official notice may also be taken of such matters as may be judicially noticed in the courts of the United States, or any other matter of established fact within the general knowledge of OEO. If the decision of the presiding officer rests on official notice of a material fact not appearing in evidence, a party shall on timely request be afforded an opportunity to show the contrary.

(m) Proposed findings and conclusions. After the hearing has concluded, but before the presiding officer makes his decision, he shall afford each participant a reasonable opportunity to submit proposed findings of fact and conclusions. After considering each proposed finding or conclusion the presiding officer shall state in his decision whether he has accepted or rejected them in accordance with the provisions of § 1067.1-8(a). § 1067.1-8

Decisions and notices regarding termination.

(a) Each decision of a presiding officer shall set forth his findings of fact, and conclusions, and shall state whether he has accepted or rejected each proposed finding of fact and conclusion submitted by the parties, pursuant to § 1067.1-7 (m). Findings of fact shall be based only upon evidence submitted to the presiding officer and matters of which official notice has been taken. The decision shall also specify the requirement or requirements with which it is found that the recipient has failed to comply.

(b) The decision of the presiding offcer may provide for continued suspension or termination of assistance to the recipient in whole or in part, and may contain such terms, conditions, and other provisions as are consistent with and will effectuate the purposes of the Act.

(c) If the hearing is held by an independent hearing examiner rather than by the responsible OEO official, he shall make an initial decision, and a copy of this initial decision shall be mailed to all parties. Any party may, within 20 days of the mailing of such initial decision, or such longer period of time as the presiding officer specifies, file with the responsible OEO official his exceptions to the initial decision and any supporting brief or statement. Upon the filing of such exceptions, the responsible OEO official shall, within 20 days of the mailing of the exceptions, review the initial decision and issue his own decision thereof, including the reasons therefor. The decision of the responsible OEO official may increase, modify, approve, vacate, remit, or mitigate any sanction imposed in the initial decision or may remand the matter to the presiding officer for further hearing or consideration.

(d) Whenever a hearing is waived, a decision shall be made by the responsible OEO official and a written copy of the final decision of the responsible OEO official shall be given to the recipient.

(e) The recipient may request the Director to review a final decision by the responsible OEO official which provides for the termination of assistance. Such a request must be made in writing within 15 days after the recipient has been notified of the decision in question and must state in detail the reasons for seeking the review. In the event the recipient requests such a review, the Director or his designee shall consider the reasons stated by the recipient for seeking the review and shall approve, modify, vacate or mitigate any sanction imposed by the responsible OEO official or remand the matter to the responsible OEO official for further hearing or consideration. The decision of the responsible OEO official will be given great weight by the Director or his designee during the review. During the course of his review the Director or his designee may, but is not required to, hold a hearing or allow the filing of briefs and arguments. Pending the decision of the Director or his designee assistance shall remain suspended under the terms and conditions specified by the responsible OEO official, unless the responsible OEO official or the Director or his designee otherwise determines. Every reasonable effort shall be made to complete the review by the Director or his designee

within 30 days of receipt by the Director of the recipient's request. The Director or his designee may however extend this period of time if he determines that additional time is necessary for an adequate review.

§ 1067.1-9 Right to counsel; travel

expenses.

In all proceedings under this subpart, whether formal or informal, the recipient and OEO shall have the right to be represented by counsel or other authorized representatives. If the recipient and any delegate agencies which have a right to participate in an informal meeting pursuant to § 1067.1-4 or a termination hearing pursuant to § 1067.1-7 do not have an attorney acting in that capacity as a regular member of the staff of the organization or a retainer arrangement with an attorney, the Boards of Directors of such recipient and delegate agencies will be authorized to designate an attorney to represent their organizations at any such show cause proceeding or termination hearing and to transfer sufficient funds from their current operating grants to pay the fees, travel, and per diem expenses of such attorney. The fees for such attorney shall be the reasonable and customary fees for an attorney practicing in the locality of the attorney. However, such fees shall not exceed $100 per day without the express written approval of OEO. Travel and per diem expenses may be paid to such attorney from grant funds only in accordance with the policies set forth in the Standard Government Travel Regulations and in §§ 1069.3-1 to 1069.3-6 of this chapter (OEO Instruction 6910–1). The Boards of Directors of the recipient or any delegate agency which has a right to participate in an informal meeting pursuant to § 1067.1-4 or a termination hearing pursuant to § 1067.1-7 will also be authorized to designate two persons in addition to an attorney whose travel and per diem expenses to attend the meeting or hearing may be paid from the organization's current operating grant. Such travel and per diem expenses shall conform to the policies set forth in the Standard Government Travel Regulations and in §§ 1069.3-1 to 1069.3-6 of this chapter (OEO Instruction 6910-1). § 1067.1-10 Modification of procedures by consent.

The responsible OEO official or the presiding officer of a termination hear

Subpart-Denial of Application for Refunding

AUTHORITY: The provisions of this Subpart issued under secs. 213, 602, 604, as amended; 81 Stat. 695, 78 Stat. 528, 81 Stat. 715; 42 U.S.C. 2796, 2942, 2944.

SOURCE: The provisions of this Subpart appear at 35 F.R. 3228, Feb. 21, 1970, unless otherwise noted.

§ 1067.2-1 Applicability of this subpart. This subpart applies to grantees receiving financial assistance under sections 221, 222, and 312 of the Economic Opportunity Act of 1964, as amended (EOA), when the assistance is administered by OEO.

§ 1067.2-2 Purpose.

This subpart establishes rules and review procedures for the denial of a current recipient's application for refunding under sections 221, 222, or 312 of the EOA. It does not apply to any administrative action of OEO based upon any violation, or alleged violation, of Title VI of the Civil Rights Act of 1964. In the case of such violation or alleged violation, the provisions of Part 1010 of this Title shall apply.

§ 1067.2-3 Definitions.

As used in this subpart, the terms "OEO", "Director", and "recipient" shall be defined in accordance with § 1067.1-3, except that the term "recipient" as used in this subpart only includes recipients under sections 221, 222, and 312 of the EOA.

year. An OEO official shall notify the recipient of this tentative decision normally in the letter of understanding and as soon as possible following the field preview.

(b) The procedures set forth in paragraphs (c) through (g) of this section shall apply only where an application for refunding submitted by a current recipient is rejected or is reduced to 80 percent or less of the recipient's current level of operations (programs-in-place) or where OEO requires that a program account be eliminated or reduced to 80 percent or less of the current level of operations. These procedures apply only to assistance furnished under sections 221, 222 and 312 of the Act, an apply only to reductions based on circumstances related to the particular grant, such as ineffective or improper use of Federal funds or noncompliance with OEO directives. These procedures do not apply to reductions based on general policy or in instances where regardless of a recipient's current level of operations (program-in-place), its application for refundng is not reduced by 20 percent

or more.

(c) Before rejecting an application of a recipient for refunding or reducing the refunding within the meaning of paragraph (b) of this section, OEO shall notify the recipient of its intention and shall offer the recipient an opportunity to submit written material and to meet informally with an OEO official to show cause why its application for refunding should not be rejected or reduced. Written notification of OEO's intention shall be sent to the recipient as far in advance of the end of the recipient's current program year as possible. The notice shall inform the recipient that a tentative decision has been made to reject or reduce an application for refunding. The notice shall also state the reasons for the tentative decision to which the applicant shall address himself if he wishes to make a presentation.

(d) If the recipient requests an informal meeting with an OEO official as discussed in paragraph (c) of this section, such a meeting shall be scheduled by OEO as soon as possible after the notice is sent to the recipient informing it of OEO's tentative decision to reject or reduce its application for refunding. However, this meeting may not, without the consent of the recipient, be scheduled sooner than 14 days after OEO has mailed the notice to the recipient. If

without fault on the part of the recipient, the recipient's operating funds have been exhausted before it has been afforded an opportunity to meet with an OEO official, the recipient shall be furnished sufficient financial assistance by OEO to maintain its present level of program operations until it has had such opportunity.

(e) The official who shall conduct this meeting shall be an OEO official who is authorized to make the grant of assistance in question, or his designee. However, in the case of any grant which may be made by a regional official only with the concurrence of a Headquarters official, and in which the application for refunding is proposed to be rejected or reduced upon the initiative of the Headquarters official, the meeting shall be conducted by such Headquarters official or his designee.

(f) An OEO official who participated in the tentative decision to reject or reduce the application for new assistance shall wherever possible attend the meeting. The meeting shall be held in Washington, D.C., in the appropriate Regional Office, or in the city or county in which the recipient is located. Within the limits stated in the preceding sentence, the decision as to where the meeting shall be held will be made by OEO. If the meeting is held in a location other than the city or county in which the recipient is located, OEO will authorize the Board of Directors of the recipient to transfer sufficient funds from its current operating grant to pay the travel and per diem expenses of a representative of the Board to attend the meeting.

(g) The recommendation of the official who conducts the meeting together with any written material submitted by the recipient shall be forwarded for review to an OEO official who is authorized to make the grant of assistance in question. This official shall inform the recipient of his decision and the basis for the decision.

§ 1067.2-5 Right to counsel.

In all proceedings under this subpart, whether formal or informal, the recipient and OEO shall have the right to be represented by counsel or other authorized representatives. If the recipient does not have an attorney acting in that capacity as a regular member of the staff of the organization or a retainer arrangement with an attorney, the Board of Directors of the recipient will be authorized to

designate an attorney to represent their organization at the meeting described in § 1067.2-4(f) and to transfer sufficient funds from its current operating grant to pay the fees, travel and per diem expenses of such attorney. The fees for such attorney shall be the reasonable and customary fees for an attorney practicing in the locality of the attorney. However, such fees shall not exceed $100 per day without the express written approval of OEO. Travel and per diem expenses may be paid to such attorney from grant funds only in accordance with the policies set forth in the Standard Government Travel Regulations and in §§ 1069.3-1 to 1069.3-6 of this chapter (OEO Instruction 6910-1).

NOTE: The above undesignated Subparts will be designated by letters by an amendment to appear in the FEDERAL REGISTER during the 1972 calendar year.

§ 1068.1 Regulations governing requirement of increase in non-Federal share. (a) Purpose. (1) Section 225(c) of the Economic Opportunity Act provides that the basic non-Federal share requirement for programs funded under sections 221 and 222(a) shall be 10 percent for the period ending June 30, 1967, and 20 percent thereafter. Section 225 (c) also permits the Director of OEO to establish objective criteria for approving applications with smaller percentages.

(2) This section explains non-Federal share requirements with regard to future grant actions under sections 221 and 222(a).1 Paragraph (b) of this section describes general non-Federal share rules applicable to most communities. The major provision in paragraph (b) of this section is the adoption of a so-called "32 month rule". In essence, all community action agencies (CAA's) and single-purpose grantees with the exception of 1967 Summer Head Start and Upward Bound will have a 32-month operation period under the 10 percent requirement prior to meeting the 20 percent non-Federal share requirement as set out in section 225 (c) of the Economic Opportunity Act. The rule set forth in paragraph (b) of this section is intended to insure fair treatment as between grantees which have been funded by OEO for a substantial period of time and those initially funded in more recent months. (NOTE: Paragraph (d) of this section explains the special steps to be followed by grantees which will reach their 33d month of CAP funding during a current program year or grant period.)

(3) Paragraph (c) of this section explains special exemption rules applicable to communities with per capita incomes below $1,000 per year. These rules are intended to provide lower non-Federal

1 For information concerning non-Federal share requirements in the projects under the Community Betterment and Employment Program under sec. 205 (d) of the Act (42 U.S.C. 2785(d)) and the New Careers Program under sec. 205 (e) of the Act (42 U.S.C. 2785 (e)) administered by the Department of Labor, see 29 CFR 51.4 (c) (1), 32 F.R. 6440, 6443 (Apr. 16, 1967).

share requirements for communities and counties which have the most serious overall poverty.

(b) Basic non-Federal share requirements.-(1) General rule. (i) Grantees that are not eligible for exemption under paragraph (c) of this section will be required to provide a 20 percent non-Federal share for any portion of their program which will be conducted after the grantee has been funded by OEO for 32 months. The original groups of CAP grantees funded in November 1964 will reach their 33d month on July 1, 1967. Those funded originally in December 1964 will reach their 33d month on August 1, 1967, and so on.

(ii) All grantees not eligible for total or partial exemption under paragraph (c) of this section reaching their 33d month during a program year or grant period will thus be required to furnish a non-Federal share of at least 10 percent but not more than 20 percent of their total program costs during that program year. Those grantees affected during their current program year, should consult paragraph (d) of this section.

(iii) For purposes of computing the non-Federal share required under this rule, it will be assumed that monthly program expenditures are made evenly throughout a grant program. The nonFederal share required under the rule therefore depends on the number of program months which will occur following the 32d anniversary of a grantee's original OEO grant. The resulting percentage is to be rounded to the nearest whole number, i.e., upward if five-tenths of 1 percent or more, downward if four-tenths of 1 percent or less. The formula for computing this is shown below:

Non-Federal=10% (basic)+(× 10%

%).

A=Number of months of current program year occurring after end of 32-month grace period.

B Total number of months in program year.

Example: A community action agency which received its first OEO grant in March 1965, requests OEO assistance for a new component project to run from August 1, 1967, through March 31, 1968.

Number of months of grant participation as of July 31, 1967 is 29.

A. Number of months occurring after 32d (1.e. Nov. 1, 1967, to Mar. 31, 1968) =5 months. B. Inclusive dates of new grant action (1.e. Aug. 1, 1967, to Mar. 31, 1968)=8 months. Non-Federal contribution=10% (basic) + 5% X 10%-10%+6.25%=16%.