NC Education Code · NC Policy Manual
NC 1505-1.6 Withholding Funds
Plain English summary
This regulation governs the process by which federal IDEA Part B funds may be withheld from the State Education Agency (SEA) or Local Education Agencies (LEAs). It requires reasonable notice and a hearing opportunity before withholding occurs, allows suspension of payments pending hearing outcomes, and specifies that withholding may be targeted to specific programs, agencies, or LEAs responsible for noncompliance until the condition is substantially rectified.
Key requirements
- Prior to withholding any funds under Part B of the IDEA, the Secretary provides reasonable notice and an opportunity for a hearing to the SEA involved.
- Pending the outcome of any hearing to withhold payments, the Secretary may suspend payments to a recipient, suspend the authority of the recipient to obligate funds under Part B of the IDEA, or both, after the recipient has been given reasonable notice and an opportunity to show cause.
- The withholding may be limited to programs or projects, or portions of programs or projects, that affected the Secretary's determination under 34 CFR 300.603(b)(1).
- The SEA must not make further payments under Part B of the IDEA to specified State agencies or LEAs that caused or were involved in the Secretary's determination under 34 CFR 300.603(b)(1).
- Until the Secretary is satisfied that the condition that caused the initial withholding has been substantially rectified, payments to the State under Part B of the IDEA must be withheld in whole or in part.
- Until the condition is substantially rectified, payments by the SEA under Part B of the IDEA must be limited to State agencies and LEAs whose actions did not cause or were not involved in the Secretary's determination under 34 CFR 300.603(b)(1).
Affected parties
- State Education Agency (SEA)
- Local Education Agencies (LEAs)
- State agencies receiving IDEA Part B funds
- Students with disabilities receiving services funded under IDEA Part B