§ 10190. Audits and Conflicts of Interest.

(a) The Authority and/or the Bureau of State Audits may conduct or require periodic audits to ensure subgrantees are using grant funds consistent with the requirements and the terms of the Program, the State Charter School Facilities Incentive Grant, and this article as approved. Subgrantees shall retain all documentation and financial data necessary to substantiate the purposes for which the grant funds were spent for a period of three years after the certification of completion of the project has been submitted or three years after the end of the funding period, whichever is longer.

(b) Subgrantees must avoid apparent and actual conflicts of interest when administering grants from the U.S. Department of Education. Department regulations at 34 CFR 75.525(a) prohibit a person from participating in an administrative decision regarding a project if (a) the decision is likely to benefit that person or his or her immediate family members; and (b) the person is a public official or has a family or business relationship with the subgrantee. Section 75.525(b) provides further that a subgrantee may not permit any person participating in a project to use his or her position for a purpose that is - or gives the appearance of being - motivated by a desire for a private or financial gain for that person or for others.

(c) Subgrantees will be required to routinely verify continued eligibility. Documentation of continued eligibility will include, but not be limited to, submission of a completed Legal Status Questionnaire disclosing information relating to any legal or regulatory proceedings or investigations in which the subgrantee or its parent/subsidiary/affiliate is or has been a party and which might have a material impact on the financial or educational viability of the charter school. The responses on the Legal Status Questionnaire and all supporting documents related to the responses will be reviewed by Authority staff and legal counsel prior to authorizing additional disbursements of grant funds.

(d) When using federal funds to enter into a contract, a State or local entity receiving a grant must comply with 34 CFR 80.36. These standards require federal grant subgrantees to develop written procurement procedures and to conduct all procurement transactions in a manner that provides, to the maximum extent possible, open and free competition. No employee, officer, or agent of the subgrantee may participate in the selection, award, or administration of any contract supported by federal funds if a real or apparent conflict of interest exists.

(e) When these funds are used for construction-related activities costing over $2,000, such as constructing a school building, renovating an existing owned school facility, or making leasehold improvements, any laborers and mechanics employed by contractors or subcontractors on the projects assisted with these federal funds must be paid in accordance with prevailing wage requirements in the Davis-Bacon Act (40 USCA section 3142, et seq.).

(f) The Authority reserves the right to conduct site visits to any charter school facility or project receiving a grant pursuant to this Article.

HISTORY

1. New section filed 6-27-2005 as an emergency; operative 6-27-2005 (Register 2005, No. 26). A Certificate of Compliance must be transmitted to OAL by 10-25-2005 or emergency language will be repealed by operation of law on the following day.

2. New section refiled 10-17-2005 as an emergency; operative 10-17-2005 (Register 2005, No. 42). A Certificate of Compliance must be transmitted to OAL by 2-14-2006 or emergency language will be repealed by operation of law on the following day.

3. Certificate of Compliance as to 10-17-2005 order transmitted to OAL 2-8-2006 and filed 3-24-2006 (Register 2006, No. 12).

4. New subsection (c) and subsection relettering filed 3-23-2009; operative 4-22-2009 (Register 2009, No. 13).

5. Amendment of subsection (a) and new subsection (f) filed 3-25-2010; operative 4-24-2010 (Register 2010, No. 13).

Note

Note: Authority cited: Sections 17179 and 17180, Education Code. Reference: Section 17180, Education Code.