
From the U.S. Code Online via GPO Access
[wais.access.gpo.gov]
[Laws in effect as of January 2, 2001]
[Document not affected by Public Laws enacted between
  January 2, 2001 and January 28, 2002]
[CITE: 29USC2934]

 
                             TITLE 29--LABOR
 
                CHAPTER 30--WORKFORCE INVESTMENT SYSTEMS
 
                      SUBCHAPTER V--ADMINISTRATION
 
Sec. 2934. Fiscal controls; sanctions


(a) Establishment of fiscal controls by States

                           (1) In general

        Each State shall establish such fiscal control and fund 
    accounting procedures as may be necessary to assure the proper 
    disbursal of, and accounting for, Federal funds allocated to local 
    areas under subchapter II of this chapter. Such procedures shall 
    ensure that all financial transactions carried out under subchapter 
    II of this chapter are conducted and records maintained in 
    accordance with generally accepted accounting principles applicable 
    in each State.

                         (2) Cost principles

        (A) In general

            Each State (including the Governor of the State), local area 
        (including the chief elected official for the area), and 
        provider receiving funds under this chapter shall comply with 
        the applicable uniform cost principles included in the 
        appropriate circulars of the Office of Management and Budget for 
        the type of entity receiving the funds.

        (B) Exception

            The funds made available to a State for administration of 
        statewide workforce investment activities in accordance with 
        section 2864(a)(3)(B) of this title shall be allocable to the 
        overall administration of workforce investment activities, but 
        need not be specifically allocable to--
                (i) the administration of adult employment and training 
            activities;
                (ii) the administration of dislocated worker employment 
            and training activities; or
                (iii) the administration of youth activities.

               (3) Uniform administrative requirements

        (A) In general

            Each State (including the Governor of the State), local area 
        (including the chief elected official for the area), and 
        provider receiving funds under this chapter shall comply with 
        the appropriate uniform administrative requirements for grants 
        and agreements applicable for the type of entity receiving the 
        funds, as promulgated in circulars or rules of the Office of 
        Management and Budget.

        (B) Additional requirement

            Procurement transactions under this chapter between local 
        boards and units of State or local governments shall be 
        conducted only on a cost-reimbursable basis.

                           (4) Monitoring

        Each Governor of a State shall conduct on an annual basis onsite 
    monitoring of each local area within the State to ensure compliance 
    with the uniform administrative requirements referred to in 
    paragraph (3).

                       (5) Action by Governor

        If the Governor determines that a local area is not in 
    compliance with the uniform administrative requirements referred to 
    in paragraph (3), the Governor shall--
            (A) require corrective action to secure prompt compliance; 
        and
            (B) impose the sanctions provided under subsection (b) of 
        this section in the event of failure to take the required 
        corrective action.

                          (6) Certification

        The Governor shall, every 2 years, certify to the Secretary 
    that--
            (A) the State has implemented the uniform administrative 
        requirements referred to in paragraph (3);
            (B) the State has monitored local areas to ensure compliance 
        with the uniform administrative requirements as required under 
        paragraph (4); and
            (C) the State has taken appropriate action to secure 
        compliance pursuant to paragraph (5).

                     (7) Action by the Secretary

        If the Secretary determines that the Governor has not fulfilled 
    the requirements of this subsection, the Secretary shall--
            (A) require corrective action to secure prompt compliance; 
        and
            (B) impose the sanctions provided under subsection (e) of 
        this section in the event of failure of the Governor to take the 
        required appropriate action to secure compliance.

(b) Substantial violation

                       (1) Action by Governor

        If, as a result of financial and compliance audits or otherwise, 
    the Governor determines that there is a substantial violation of a 
    specific provision of this chapter, and corrective action has not 
    been taken, the Governor shall--
            (A) issue a notice of intent to revoke approval of all or 
        part of the local plan affected; or
            (B) impose a reorganization plan, which may include--
                (i) decertifying the local board involved;
                (ii) prohibiting the use of eligible providers;
                (iii) selecting an alternative entity to administer the 
            program for the local area involved;
                (iv) merging the local area into one or more other local 
            areas; or
                (v) making other such changes as the Secretary or 
            Governor determines necessary to secure compliance.

                             (2) Appeal

        (A) In general

            The actions taken by the Governor pursuant to subparagraphs 
        (A) and (B) of paragraph (1) may be appealed to the Secretary 
        and shall not become effective until--
                (i) the time for appeal has expired; or
                (ii) the Secretary has issued a decision.

        (B) Additional requirement

            The Secretary shall make a final decision under subparagraph 
        (A) not later than 45 days after the receipt of the appeal.

                     (3) Action by the Secretary

        If the Governor fails to promptly take the actions required 
    under paragraph (1), the Secretary shall take such actions.

(c) Repayment of certain amounts to the United States

                           (1) In general

        Every recipient of funds under this chapter shall repay to the 
    United States amounts found not to have been expended in accordance 
    with this chapter.

                       (2) Offset of repayment

        If the Secretary determines that a State has expended funds made 
    available under this chapter in a manner contrary to the 
    requirements of this chapter, the Secretary may offset repayment of 
    such expenditures against any other amount to which the State is or 
    may be entitled, except as provided under subsection (d)(1) of this 
    section.

                (3) Repayment from deduction by State

        If the Secretary requires a State to repay funds as a result of 
    a determination that a local area of the State has expended funds 
    contrary to the requirements of this chapter, the Governor of the 
    State may use an amount deducted under paragraph (4) to repay the 
    funds, except as provided under subsection (e)(1) \1\ of this 
    section.
---------------------------------------------------------------------------
    \1\ So in original. Probably should be subsection ``(d)(1)''.
---------------------------------------------------------------------------

                       (4) Deduction by State

        The Governor may deduct an amount equal to the misexpenditure 
    described in paragraph (3) from subsequent program year allocations 
    to the local area from funds reserved for the administrative costs 
    of the local programs involved, as appropriate.

                           (5) Limitations

        A deduction made by a State as described in paragraph (4) shall 
    not be made until such time as the Governor has taken appropriate 
    corrective action to ensure full compliance within such local area 
    with regard to appropriate expenditures of funds under this chapter.

(d) Repayment of amounts

                           (1) In general

        Each recipient of funds under this chapter shall be liable to 
    repay the amounts described in subsection (c)(1) of this section, 
    from funds other than funds received under this chapter, upon a 
    determination by the Secretary that the misexpenditure of funds was 
    due to willful disregard of the requirements of this chapter, gross 
    negligence, failure to observe accepted standards of administration, 
    or a pattern of misexpenditure as described in paragraphs (2) and 
    (3) of subsection (c) of this section. No such determination shall 
    be made under this subsection or subsection (c) of this section 
    until notice and opportunity for a fair hearing has been given to 
    the recipient.

                  (2) Factors in imposing sanctions

        In determining whether to impose any sanction authorized by this 
    section against a recipient for violations by a subgrantee or 
    contractor of such recipient under this chapter (including the 
    regulations issued under this chapter), the Secretary shall first 
    determine whether such recipient has adequately demonstrated that 
    the recipient has--
            (A) established and adhered to an appropriate system for the 
        award and monitoring of grants and contracts with subgrantees 
        and contractors that contains acceptable standards for ensuring 
        accountability;
            (B) entered into a written grant agreement or contract with 
        such subgrantee or contractor that established clear goals and 
        obligations in unambiguous terms;
            (C) acted with due diligence to monitor the implementation 
        of the grant agreement or contract, including the carrying out 
        of the appropriate monitoring activities (including audits) at 
        reasonable intervals; and
            (D) taken prompt and appropriate corrective action upon 
        becoming aware of any evidence of a violation of this chapter, 
        including regulations issued under this chapter, by such 
        subgrantee or contractor.

                             (3) Waiver

        If the Secretary determines that the recipient has demonstrated 
    substantial compliance with the requirements of paragraph (2), the 
    Secretary may waive the imposition of sanctions authorized by this 
    section upon such recipient. The Secretary is authorized to impose 
    any sanction consistent with the provisions of this chapter and any 
    applicable Federal or State law directly against any subgrantee or 
    contractor for violation of this chapter, including regulations 
    issued under this chapter.

(e) Immediate termination or suspension of assistance in emergency 
        situations

    In emergency situations, if the Secretary determines it is necessary 
to protect the integrity of the funds or ensure the proper operation of 
the program or activity involved, the Secretary may immediately 
terminate or suspend financial assistance, in whole or in part, to the 
recipient if the recipient is given prompt notice and the opportunity 
for a subsequent hearing within 30 days after such termination or 
suspension. The Secretary shall not delegate any of the functions or 
authority specified in this subsection, other than to an officer whose 
appointment is required to be made by and with the advice and consent of 
the Senate.

(f) Discrimination against participants

    If the Secretary determines that any recipient under this chapter 
has discharged or in any other manner discriminated against a 
participant or against any individual in connection with the 
administration of the program involved, or against any individual 
because such individual has filed any complaint or instituted or caused 
to be instituted any proceeding under or related to this chapter, or has 
testified or is about to testify in any such proceeding or investigation 
under or related to this chapter, or otherwise unlawfully denied to any 
individual a benefit to which that individual is entitled under the 
provisions of this chapter or the Secretary's regulations, the Secretary 
shall, within 30 days, take such action or order such corrective 
measures, as necessary, with respect to the recipient or the aggrieved 
individual, or both.

(g) Remedies

    The remedies described in this section shall not be construed to be 
the exclusive remedies available for violations described in this 
section.

(Pub. L. 105-220, title I, Sec. 184, Aug. 7, 1998, 112 Stat. 1042.)


                            Prior Provisions

    Provisions similar to this section were contained in section 1574 of 
this title prior to repeal by Pub. L. 105-220.

                  Section Referred to in Other Sections

    This section is referred to in sections 2822, 2833, 2936, 2937 of 
this title.
