[Code of Federal Regulations]
[Title 34, Volume 3]
[Revised as of July 1, 2004]
From the U.S. Government Printing Office via GPO Access
[CITE: 34CFR461.40]

[Page 131]
 
                           TITLE 34--EDUCATION
 
  CHAPTER IV--OFFICE OF VOCATIONAL AND ADULT EDUCATION, DEPARTMENT OF 
                                EDUCATION
 
PART 461_ADULT EDUCATION STATE-ADMINISTERED BASIC GRANT PROGRAM
--Table of Contents
 
            Subpart E_What Conditions Must be Met by a State?
 
Sec. 461.40  What are the State and local administrative costs requirements?


    (a)(1) Beginning with the fiscal year 1991 grant (a grant that is 
awarded on or after July 1, 1991 from funds appropriated in the fiscal 
year 1991 appropriation), an SEA may use no more than 5 percent of its 
grant or $50,000--whichever is greater--for necessary and reasonable 
State administrative costs.
    (2) For grants awarded from funds appropriated for fiscal years 
prior to fiscal year 1991 (grants awarded before July 1, 1991), an SEA 
may determine what percent of its grant is necessary and reasonable for 
State administrative costs.
    (b)(1) At least 95 percent of an eligible recipient's award from the 
SEA must be expended for adult education instructional activities.
    (2) The remainder may be used for local administrative costs--
noninstructional expenses, including planning, administration, 
evaluation, personnel development, and coordination--that are necessary 
and reasonable.
    (3) If the administrative cost limits under paragraph (b)(2) of this 
section are insufficient for adequate planning, administration, 
evaluation, personnel development, and coordination of programs 
supported under the Act, the SEA shall negotiate with local grant 
recipients in order to determine an adequate level of funds to be used 
for noninstructional purposes.

(Authority: 20 U.S.C. 1203b and 1205(c))