Indian Fellowship and Professional Development Programs

SUMMARY: The Secretary proposes to amend the regulations that govern

grants for the Indian Fellowship Program. This program is authorized

under Title IX of the Elementary and Secondary Education Act (ESEA) of

1965, as amended by the Improving America's Schools Act of 1994,

enacted October 20, 1994. These regulations would identify eligible

applicants for the program and the specific application and other

program requirements that applicants must meet in order to be

considered for funding. These regulations would also provide certain

general provisions and requirements for the new payback provisions that

apply to both the Indian Fellowship Program and the Professional

Development Program.

DATES: Comments must be received on or before August 26, 1996.

ADDRESSES: All comments concerning these proposed regulations should be

addressed to Cathie Martin, Office of Indian Education, Department of

Education, 600 Independence Avenue, S.W., Portals Building--Room 4300,

Washington, D.C. 20202-6335. Comments may also be sent through the

Internet to ``Indian__F[email protected]''.

Comments that concern information collection requirements must be

sent to the Office of Management and Budget at the address listed in

the Paperwork Reduction Act section of this preamble. A copy of those

comments may also be sent to the Department representative named in the

preceding paragraph.

FOR FURTHER INFORMATION CONTACT: Cathie Martin. Telephone: (202) 260-

1683. Individuals who use a telecommunications device for the deaf

(TDD) may call the Federal Information Relay Service (FIRS) at 1-800-

877-8339 between 8 a.m. and 8 p.m., Eastern time, Monday through

Friday.

SUPPLEMENTARY INFORMATION: On October 20, 1994 the Professional

Development Program and the Indian Fellowship Program were

substantially revised and recodified, respectively, as sections 9122

and 9123 of Subpart 2 of Part A of Title IX of the Elementary and

Secondary Education Act of 1965, as amended by Pub. L. 103-382. These

proposed regulations would identify eligible applicants for the Indian

Fellowship Program and address the specific program requirements,

including application requirements and requirements concerning the new

payback provisions that applicants must meet in order to be considered

for funding for both new and continuation awards. The criteria for

selecting participants for the Professional Development Program are not

included in these proposed regulations. The selection criteria in the

Education Department General Administrative Regulations (EDGAR), 34 CFR

Part 75, will be used for competitions under the Professional

Development Program.

In addition, certain of these proposed regulations would govern the

Professional Development Program (Sec. 263.3, (definitions), Sec. 263.1

(b) and (c), and Secs. 263.35 through 263.37 (the new payback

provisions that also apply to this program)).

With regard to the payback provisions, the Indian Fellowship

Program and Professional Development Program now require that an

individual receiving financial assistance either (1) perform work

related to the training for which assistance was received and that

benefits Indian people; or (2) repay all or a prorated portion of the

assistance.

On June 27, 1995 the Secretary published final regulations (60 FR

33300) to govern the fiscal year (FY) 1995 grant competitions for the

Indian Fellowship and Professional Development Programs. This notice of

proposed rulemaking (NPRM) proposes to amend the regulations that will

apply to all FY 1996 awards, both new and continuation, and subsequent

fiscal years' awards.

Except for minor editorial and technical revisions, there are no

differences between the regulations published June 27, 1995 and this

NPRM. The submission of the certification required in Sec. 263.21(e) is

not a new requirement but is a technical revision added for the

convenience of the reader.

Executive Order 12866

Clarity of the Regulations

Executive Order 12866 requires each agency to write regulations

that are easy to understand.

The Secretary invites comments on how to make these proposed

regulations easier to understand, including answers to questions such

as the following: (1) Are the requirements in the regulations clearly

stated? (2) Do the regulations contain technical terms or other wording

that interferes with their clarity? (3) Does the format of the

regulations (grouping and order of sections, use of headings,

paragraphing, etc.) aid or reduce their clarity? Would the regulations

be easier to understand if they were divided into more (but shorter)

sections? (A ``section'' is preceded by the symbol ``Sec. '' and a

numbered heading; for example, Sec. 263.2 Who is eligible to apply

under the Indian Fellowship Program?) (4) Is the description of the

proposed regulations in the ``Supplementary Information'' section of

this preamble helpful in understanding the proposed regulations? How

could this description be more helpful in making the proposed

regulations easier to understand? (5) What else could the Department do

to make the regulations easier to understand?

A copy of any comments that concern how the Department could make

these proposed regulations easier to understand should be sent to

Stanley M. Cohen, Regulations Quality Officer, U.S. Department of

Education, 600 Independence Avenue, S.W. (Room 5100, FB-10B),

Washington, D.C. 20202-2241.

Regulatory Flexibility Act Certification

The Secretary certifies that these proposed regulations would not

have a significant economic impact on a substantial number of small

entities.

These proposed regulations would affect individuals, institutions

of higher education (IHEs), and local educational agencies (LEAs).

Individuals, however, are not defined as ``small entities'' in the

Regulatory Flexibility Act. These proposed regulations would not have a

significant economic impact on the small IHEs or LEAs affected because

the individuals, rather than the IHEs or LEAs, are subject to the

payback provisions of these proposed regulations.

Paperwork Reduction Act of 1995

Sections 263.21, 263.22, 263.30, 263.31, 263.32, 263.33, 263.35,

263.36, and 263.37 contain information collection requirements. As

required by the Paperwork Reduction Act of 1995 (44 U.S.C. 3507(d)),

the Department of Education has submitted a copy of these sections to

the Office of Management and Budget (OMB) for review.

Collection of Information: Indian Fellowship and Professional

Development Programs

Individuals are eligible to apply for grants under the Indian

Fellowship Program. The information to be collected includes--

assurances to meet certain statutory requirements; documents to show

proof that the individual meets the definition of

[[Page 39247]]

``Indian;'' documents that provide verification that the individual has

been admitted to an institution of higher education for an allowable

field and level of study; documents that show the individual's past

academic performance; a narrative essay on the individual's commitment

to the selected field of study and service to the Indian community; and

financial information to determine the amount of the fellowship. All

new applications are submitted in response to a notice published in the

Federal Register printed once each year. For continuing participants,

the information submitted annually consists of information to document

continued academic and financial eligibility. The information from both

new and continuing respondents is used to determine applicant

eligibility and award amounts of participants selected. All

participants are required to provide a copy of their transcript after

each academic term.

The annual reporting burden for reviewing instructions, searching

existing data sources, gathering and maintaining the data needed, and

completing and reviewing the collection of information is estimated to

be a total of four hours per response for 550 new respondents, .5 hours

per response for 60 continuing respondents, and .25 hours per response

for reporting (transcripts) for 100 respondents.

Eligible applicants for the Professional Development Program

include institutions of higher education, including Indian institutions

of higher education, State or local educational agencies in consortium

with an institution of higher education, and Indian tribes or

organizations in consortium with an institution of higher education.

The Indian Fellowship Program and the Professional Development Program

require participants to perform a service payback or provide a cash

payback if the service cannot be performed or completed. For those

performing a service payback upon completion of their training program,

participants will be required to provide a certification of employment

every six months until the payback is completed. The information

collected is used to track the progress of participants in completing

their payback requirements. The annual reporting burden for this

requirement is estimated to be .50 hours per response for 20

respondents twice a year.

The total annual reporting and recordkeeping burden for this

collection is estimated to be 2,275 hours.

Organizations and individuals desiring to submit comments on the

information collection requirements should direct them to the Office of

Information and Regulatory Affairs, OMB, Room 10235, New Executive

Office Building, Washington, D.C., 20503; Attention: Wendy Taylor.

The Department considers comments by the public on this proposed

collection of information in--

Evaluating whether the proposed collection of information

is necessary for the proper performance of the functions of the

Department, including whether the information will have practical

utility;

Evaluating the accuracy of the Department's estimate of

the burden of the proposed collection of information, including the

validity of the methodology and assumptions used;

Enhancing the quality, usefulness, and clarity of the

information to be collected; and

Minimizing the burden of the collection of information on

those who are to respond, including through the use of appropriate

automated, electronic, mechanical, or other technological collection

techniques or other forms of information technology; e.g., permitting

electronic submission of responses.

OMB is required to make a decision concerning the collection of

information contained in these proposed regulations between 30 and 60

days after publication of this document in the Federal Register.

Therefore, a comment to OMB is best assured of having its full effect

if OMB receives it within 30 days of publication. This does not affect

the deadline for the public to comment to the Department on the

proposed regulations.

Intergovernmental Review

The Indian Fellowship Program is not subject to the requirements of

Executive Order 12372 and the regulations in 34 CFR Part 79.

The Professional Development Program, with the exception of

assistance to federally recognized tribes, is subject to the

requirements of Executive Order 12372 and the regulations in 34 CFR

Part 79. The objective of the Executive order is to foster an

intergovernmental partnership and a strengthened federalism by relying

on processes developed by State and local governments for coordination

and review of proposed Federal financial assistance.

In accordance with the order, this document is intended to provide

early notification of the Department's specific plans and actions for

this program.

Invitation to Comment

Interested persons are invited to submit comments and

recommendations regarding these proposed regulations.

All comments submitted in response to these proposed regulations

will be available for public inspection, during and after the comment

period, in Room 4302, Portals Building, 1250 Maryland Avenue, S.W.,

Washington, D.C., between the hours of 8:30 a.m. and 4 p.m., Monday

through Friday of each week except Federal holidays.

Assessment of Educational Impact

The Secretary particularly requests comments on whether the

proposed regulations in this document would require transmission of

information that is being gathered by or is available from any other

agency or authority of the United States.

List of Subjects in 34 CFR Part 263

Grant programs-education, Indians-education, Reporting and

recordkeeping requirements, Scholarships and fellowships.

Dated: July 22, 1996.

Gerald N. Tirozzi,

Assistant Secretary for Elementary and Secondary Education.

(Catalog of Federal Domestic Assistance Numbers: 84.087 Indian

Education--Fellowships for Indian Students; and 84.299 Indian

Education--Special Programs.)

The Secretary proposes to amend Title 34 of the Code of Federal

Regulations by revising Part 263 to read as follows:

PART 263--INDIAN FELLOWSHIP AND PROFESSIONAL DEVELOPMENT PROGRAMS

Subpart A--General

Sec.

263.1 What are the Indian Fellowship and the Professional

Development Programs?

263.2 Who is eligible to apply under the Indian Fellowship Program?

263.3 What definitions apply to the Indian Fellowship and

Professional Development Programs?

263.4 What are the allowable fields of study in the Indian

Fellowship Program?

263.5 What does a fellowship award include?

263.6 What is the time period for a fellowship award?

Subpart B--How Does the Secretary Select Fellows?

263.20 What priority is given to certain applicants?

263.21 What should the fellowship application contain?

263.22 How does the Secretary evaluate applications?

[[Page 39248]]

Subpart C--What Conditions Must be Met by Fellows?

263.30 What are the basic requirements of a fellow?

263.31 What information must be submitted after a fellowship is

awarded?

263.32 What are the requirements for a leave of absence?

263.33 What is required for continued funding under a fellowship?

263.34 When is a fellowship discontinued?

263.35 What are the payback requirements?

263.36 When does payback begin?

263.37 What are the payback reporting requirements?

Subpart D--How Are Fellowship Payments Made?

263.40 How are payments made?

Authority: 20 U.S.C. 7832 and 7833, unless otherwise noted.

Subpart A--General

Sec. 263.1 What are the Indian Fellowship and the Professional

Development Programs?

(a) The Indian Fellowship Program provides fellowships to enable

Indian students to pursue a course of study leading to--

(1) A postbaccalaureate degree in medicine, law, education,

psychology, clinical psychology, or a related field; or

(2) An undergraduate or postbaccalaureate degree in business

administration, engineering, natural resources, or a related field.

(b) The Professional Development Program provides grants to

eligible entities to--

(1) Increase the number of qualified Indian individuals in

professions that serve Indian people;

(2) Provide training to qualified Indian individuals to become

teachers, administrators, teacher aides, social workers, and ancillary

educational personnel; and

(3) Improve the skills of qualified Indian individuals who serve in

the capacities described in paragraph (b)(2) of this section.

(c) The Indian Fellowship and the Professional Development Programs

require individuals who receive training under either program to--

(1) Perform work that is related to the training received under

either program and that benefits Indian people or to repay all or a

prorated part of the assistance received under the program; and

(2) Report to the Secretary on the individual's compliance with the

work requirement.

(Authority: 20 U.S.C. 7832 and 7833)

Sec. 263.2 Who is eligible to apply under the Indian Fellowship

Program?

In order to be eligible for a fellowship, an applicant must be--

(a) An Indian as defined in Sec. 263.3;

(b) A United States citizen;

(c) Currently in attendance or have been accepted for admission as

a full-time undergraduate or graduate student at an accredited

institution of higher education in one of the fields listed in

Sec. 263.4 or a related field;

(d) Recognized by the institution as a degree candidate; and

(e) Eligible under 34 CFR 75.60.

(Authority: 20 U.S.C. 7833; 20 U.S.C. 1221e-3(a)(1) and 3474)

Sec. 263.3 What definitions apply to the Indian Fellowship and

Professional Development Programs?

(a) Definitions in EDGAR. The following terms used in this part are

defined in 34 CFR 77.1:

Department

Secretary

(b) Other definitions. The following definitions also apply to this

part:

Dependent allowance means costs for the care of minor children who

reside with the fellow and for whom the fellow has responsibility.

Expenses means tuition and required fees; required university

health insurance; room, personal living expenses, and board at or near

the institution; dependent allowance; instructional supplies; and

reasonable travel and research costs associated with doctoral

dissertation completion.

Fellow means the recipient of a fellowship under the Indian

Fellowship Program. The term ``fellow'' also includes individual

project participants under the Professional Development Program with

regard to the payback provisions contained in Secs. 263.35 through

263.37.

Fellowship means an award under the Indian Fellowship Program.

Full course load means the number of credit hours that the

institution requires of a full-time student.

Full-time student means a student who--

(1) Is a degree candidate;

(2) Carries a full course load; and

(3) Is not employed for more than 20 hours a week.

Good standing means a cumulative grade point average of at least

2.0 on a 4.0 grade point scale in which failing grades are computed as

part of the average, or another appropriate standard established by the

institution.

Graduate degree means a postbaccalaureate degree awarded by an

institution of higher education beyond the undergraduate level.

Indian means an individual who is--

(1) A member of an Indian tribe or band, as membership is defined

by the Indian tribe or band, including any tribe or band terminated

since 1940, and any tribe or band recognized by the State in which the

tribe or band resides; or

(2) A descendant, in the first or second degree, of an individual

described in paragraph (1) of this definition; or

(3) Considered by the Secretary of the Interior to be an Indian for

any purpose; or

(4) An Eskimo, Aleut, or other Alaska Native; or

(5) A member of an organized Indian group that received a grant

under the Indian Education Act of 1988 as it was in effect on October

19, 1994.

Institution of higher education means an accredited college or

university within the United States that offers a baccalaureate or

postbaccalaureate degree.

Payback means work-related service or cash reimbursement to the

Department of Education for the training received under the Indian

Fellowship or the Professional Development Program.

Stipend means that portion of an award that is used for room and

board and personal living expenses.

Undergraduate degree means a baccalaureate (bachelor's) degree

awarded by an institution of higher education.

(Authority: 20 U.S.C. 7832, 7833, and 7881)

Sec. 263.4 What are the allowable fields of study in the Indian

Fellowship Program?

(a) The following are allowable fields for an undergraduate degree

under this program:

(1) Business administration.

(2) Engineering.

(3) Natural resources.

(b) The following are allowable fields for a graduate degree under

this program:

(1) Medicine.

(2) Clinical psychology.

(3) Law.

(4) Education.

(5) Psychology.

(6) Engineering.

(7) Natural resources.

(8) Business administration.

(c) The Secretary considers under paragraphs (a) and (b) of this

section, on a case-by-case basis, the eligibility of applications for

fellowships in related fields of study.

(Authority: 20 U.S.C. 7833)

Sec. 263.5 What does a fellowship award include?

(a) The Secretary awards a fellowship in an amount up to, but not

more than, the expenses as defined in this part. The assistance

provided by the program either--

[[Page 39249]]

(1) Fully finances a student's educational expenses; or

(2) Supplements other sources of financial aid, including other

Federal financial aid other than loans, for meeting educational

expenses.

(b) The Secretary announces the expected maximum amounts for

subsistence and other fellowship costs in the annual application notice

published in the Federal Register.

(Authority: 20 U.S.C. 7833)

Sec. 263.6 What is the time period for a fellowship award?

(a) The Secretary awards a fellowship for a period of time not

exceeding--

(1) Four academic years for an undergraduate or doctorate degree;

and

(2) Two academic years for a master's degree.

(b) With prior approval from the Secretary, summer school may be

allowed for eligible continuation students after completion of the

first academic year.

(Authority: 20 U.S.C. 7833)

Subpart B--How Does the Secretary Select Fellows?

Sec. 263.20 What priority is given to certain applicants?

The Secretary awards not more than 10 percent of the fellowships,

on a priority basis, to persons receiving training in guidance

counseling with a specialty in the area of alcohol and substance abuse

counseling and education.

(Authority: 20 U.S.C. 7833)

Sec. 263.21 What should the fellowship application contain?

In addition to the requirements specified in Sec. 263.22, an

applicant shall provide--

(a) Evidence that the applicant is an Indian as defined in

Sec. 263.3. Evidence may be in the form of--

(1)(i) A copy of the applicant's documentation of tribal enrollment

or membership; or

(ii) A copy of the parent's or grandparent's documentation of

tribal enrollment or membership, with supporting birth certificates or

similar documents showing the applicant's descendance from the enrolled

member;

(2) A letter of certification on official letterhead with the

appropriate signature from a federally or State recognized tribe or

band; or

(3) A certificate of degree of Indian blood (CDIB) issued by an

authorized representative of the Bureau of Indian Affairs or an

official of a federally recognized tribe;

(b)(1) Evidence that the applicant is currently in attendance or

has been accepted for admission as a full-time student at an accredited

institution of higher education in one of the eligible fields of study

listed in Sec. 263.4; or

(2) For an applicant who has not yet been accepted for admission,

documentation of having been accepted by an accredited institution of

higher education by a date to be specified by the Secretary;

(c)(1) The most current official high school and, if appropriate,

undergraduate transcripts for undergraduate applicants; or

(2) The most current official undergraduate and, if appropriate,

graduate transcripts for graduate applicants;

(d) The certification required under 34 CFR 75.61; and

(e) The certification contained within the application regarding

agreement to fulfill the requirements of the payback provision that is

signed and dated by the applicant.

(Authority: 20 U.S.C. 7833; 20 U.S.C. 1221e-3(a)(1) and 3474).

Sec. 263.22 How does the Secretary evaluate applications?

(a) The Secretary reviews and ranks an application with other

applications for the same field and related fields of study.

(b) The following criteria, with the total number of points

available in parenthesis, are used to evaluate an application for a new

fellowship award:

(1) Official academic record (60 points). The Secretary considers

the quality of the applicant's academic record by reviewing--

(i) The applicant's grade point average and, if applicable, scores

from such standardized tests as the Scholastic Aptitude Test (SAT),

American College Testing Assessment Program (ACT), Graduate Record

Examination (GRE), Law School Admissions Test (LSAT), Medical College

Admission Test (MCAT), and achievement tests; and

(ii) The applicant's official transcripts and any grade reports.

(2) Letters of recommendation (15 points). The Secretary considers

the applicant's potential for success in completing the academic

requirements for his or her field of study by reviewing one letter of

recommendation from each of the following categories:

(i) A school principal, teacher, academic or non-academic

instructor or counselor, a college professor, or academic advisor.

(ii) A member of the community or civic leader who has observed the

applicant in educational, social, or civic activities.

(iii) A tribal representative or an Indian community member.

(3) Commitment essay (25 points). The Secretary considers the

applicant's commitment by reviewing an essay, written by the applicant

that addresses--

(i) The applicant's career goals and why the chosen field of study

will benefit Indian people;

(ii) The applicant's life experiences and personal and family

expectations that will enhance the applicant's anticipated career

accomplishments; and

(iii) The applicant's anticipated commitment to providing service

to Indian people.

(Authority: 20 U.S.C. 7833)

Subpart C--What Conditions Must be Met by Fellows?

Sec. 263.30 What are the basic requirements of a fellow?

A fellow shall--

(a) Start school during the first semester of the award at the

institution named on the grant award document and complete at least one

full academic term;

(b) Submit to the Secretary two copies of his or her official grade

report at the close of each academic term and upon completion of the

training program at that institution;

(c) Submit an annual continuation application, in the form and

timeframes specified by the Secretary, to request funding for each

remaining academic year approved under the initial application;

(d) Request from the Secretary a written leave of absence at least

30 days prior to withdrawal, unless an emergency situation has

occurred, for any interruption in his or her program of academic

studies; and

(e) Sign an agreement with the Department to meet the provisions of

the payback requirement.

(Authority: 20 U.S.C. 7833)

Sec. 263.31 What information must be submitted after a fellowship is

awarded?

To verify further the accuracy of the information provided in the

application, the applicant shall provide all information and documents

as requested by the Secretary, including information on other financial

aid sources for educational purposes. The applicant's failure to

provide the requested information and documents invalidates the

application, and the Secretary will not consider it for funding.

[[Page 39250]]

(Authority: 20 U.S.C. 7833)

Sec. 263.32 What are the requirements for a leave of absence?

(a) The Secretary may approve a leave of absence for a period not

longer than one academic year if a fellow has successfully completed at

least one academic year.

(b) A written request for a leave of absence must be submitted to

the Secretary not less than 30 days prior to withdrawal or completion

of a grading period, unless an emergency situation has occurred and the

Secretary waives the prior notification requirement.

(c) The Secretary permits a leave of absence only if the

institution certifies that the fellow is eligible to resume his or her

course of study at the end of the leave of absence.

(d) The Secretary withdraws any remaining funds of the fellow's

award if a leave of absence occurs prior to the end of an academic

term.

(Authority: 20 U.S.C. 7833)

Sec. 263.33 What is required for continued funding under a fellowship?

(a) The Secretary reviews the status of each fellow at the end of

each year and continues support only if the fellow--

(1) Has complied with requirements under this part;

(2) Has remained a full-time student in good standing in the field

in which the fellowship was awarded; and

(3) Has submitted a noncompeting continuation application

requesting additional support.

(b) A fellowship terminates when the fellow receives the degree

being sought or after the fellow has received the fellowship for the

maximum number of years allowed as defined in Sec. 263.6, whichever

comes first.

(Authority: 20 U.S.C. 7833)

Sec. 263.34 When is a fellowship discontinued?

(a) The Secretary may discontinue the fellowship if the fellow--

(1) Fails to comply with the provisions under this part, including

failure to obtain an approved leave of absence under Sec. 263.32, or

with the terms and conditions of the fellowship award; or

(2) Fails to report any change in his or her academic status.

(b) The Secretary discontinues a fellowship only after providing

reasonable notice and an opportunity for the fellow to rebut, in

writing or in an informal meeting with the responsible official in the

Department of Education, the basis for the decision.

(Authority: 20 U.S.C. 7833)

Sec. 263.35 What are the payback requirements?

(a) Individuals receiving assistance under the Indian Fellowship

Program or the Professional Development Program are required to--

(1) Perform work related to the training received and that benefits

Indian people; or

(2) Repay all or a prorated part of the assistance received.

(b) The period of time required for a work-related payback is

equivalent to the total period of time for which training was actually

received under the Indian Fellowship Program or the Professional

Development Program.

(c) The cash payback required must be equivalent to the total

amount of funds received and expended for training received under

either of these programs and may be prorated based on any approved

work-related service the participant performs.

(Authority: 20 U.S.C. 7832 and 7833)

Sec. 263.36 When does payback begin?

(a) For all fellows who complete their training under the Indian

Fellowship Program or the Professional Development Program, except for

medical degree and doctoral degree candidates, payback must begin

within six months from the date of completion of the training.

(b) For fellows in a doctoral degree program requiring a

dissertation, payback must begin not later than two years after the

program's academic course work has been completed or the institution

determines the student is no longer eligible to participate in the

training program, whichever occurs first.

(1) After academic course work has been completed, fellows in a

doctoral degree program shall submit an annual written report to the

Secretary on the status of the dissertation.

(2) Within 30 days of completion of the dissertation, fellows in a

doctoral degree program shall provide written notification to the

Secretary of completion of the dissertation and of the participant's

plans for completing a work-related or cash payback.

(c) For fellows in a doctoral degree program with clinical or

internship requirements, payback must begin within six months after the

clinical or internship requirements have been met or the institution

determines the student is no longer eligible to participate in the

training program, whichever occurs first.

(1) After academic course work has been completed, fellows in a

doctoral degree program with clinical or internship requirements shall

submit an annual written report to the Secretary on the status of

completion of the clinical or internship requirements.

(2) Within 30 days of completion of the clinical or internship

requirements, fellows shall provide written notification to the

Secretary of completion of those requirements and the participant's

plans for completing a work-related or cash payback.

(d) For fellows in a medical degree program, payback must begin six

months from the date that all residency requirements of the program

have been met or the institution determines the student is no longer

eligible to participate in the training program, whichever occurs

first.

(1) After academic course work has been completed, fellows in a

medical degree program shall submit an annual written report to the

Secretary on the status of completion of the residency requirements of

the program.

(2) Within 30 days of completion of the residency requirements,

fellows in a medical degree program shall provide written notification

to the Secretary of completion of the residency requirements and of the

participant's plans for completing a work-related or cash payback.

(e) For fellows who do not complete their training under the Indian

Fellowship Program or the Professional Development Program, payback

must begin within six months from the date the fellow leaves the Indian

Fellowship Program or the Professional Development Program, unless he

or she continues as a full-time student, without interruption, in a

program leading to a degree in an accredited institution of higher

education.

(1) If the fellow leaves the Indian Fellowship Program or the

Professional Development Program, but plans to continue his or her

education as a full-time student, the Secretary may defer the payback

requirement until the participant has completed his or her educational

program. Written requests for deferment must be submitted to the

Secretary within 30 days of leaving the Indian Fellowship Program or

the Professional Development Program and must provide the following

information:

(i) The name of the accredited institution the student will be

attending.

(ii) A copy of the letter of admission from the institution.

(iii) The degree being sought.

(iv) The projected date of completion.

(2) After approval by the Secretary of the deferment of the payback

provision on the basis of continuing as a full-time student, former

fellows are required to submit to the Secretary, after every grading

period, a status report from an

[[Page 39251]]

academic advisor or other authorized representative of the institution

of higher education showing verification of enrollment and status.

(Authority: 20 U.S.C. 7832 and 7833)

Sec. 263.37 What are the payback reporting requirements?

(a) Written notice. Participants shall submit to the Secretary,

within 30 days of completion of their training program, a written

notice of intent to complete a work-related or cash payback or to

continue in a degree program as a full-time student.

(b) Work-related payback. If the participant proposes a work-

related payback, the written notice of intent must include information

explaining how the work-related service is related to the training

received and benefits Indian people.

(1) For work-related service, the Secretary reviews each

participant's payback plan to determine if the work-related service is

related to the training received and benefits Indian people. The

Secretary approves the payback plan if a determination is made that the

work-related service to be performed is related to the training

received and benefits Indian people, meets all applicable statutory and

regulatory requirements, and is otherwise appropriate.

(2) The payback plan for work-related service must identify where,

when, the type of service, and for whom the work will be performed.

(3) A participant shall notify the Secretary in writing of any

change in the work-related service being performed within 30 days of

such a change.

(4) For work-related payback, individuals shall submit a status

report every six months beginning from the date the work-related

service is to begin. The reports must include a certification from the

participant's employer that the service or services have been performed

without interruption.

(5) Upon written request, and if appropriate, the Secretary may

extend the period for completing a work-related payback by a total of

18 months.

(6) For participants who initiate, but cannot complete, a work-

related payback, the payback reverts to a cash payback.

(c) Cash payback. If a cash payback is to be made, the Department

will contact the participant to establish an appropriate schedule for

payments.

(Authority: 20 U.S.C. 7832 and 7833)

Subpart D--How Are Fellowship Payments Made?

Sec. 263.40 How are payments made?

(a) Fellowship payments are made directly to the institution of

higher education where a fellow is enrolled, with stipends provided to

the fellow in installments by the institution. No fewer than two

installments per academic year may be made.

(b) If a fellow transfers to another institution, the fellowship

may also be transferred provided the fellow maintains basic eligibility

for the award.

(c) A fellow who officially or unofficially withdraws or is

expelled from an institution before completion of a term shall refund a

prorated portion of the stipends received, as determined by the

Secretary. The Secretary requires the institution to return any

unexpended funds.

(Authority: 20 U.S.C. 7833)

[FR Doc. 96-18917 Filed 7-25-96; 8:45 am]

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