29 U.S.C. § 3244 — Fiscal controls; sanctions

Page 937 TITLE 29—LABOR § 3244 506 of Pub. L. 113–128, set out as a note under section 3101 of this title. § 3243. Monitoring (a) In general The Secretary is authorized to monitor all re- cipients of financial assistance under this sub- chapter to determine whether the recipients are complying with the provisions of this sub- chapter, including the regulations issued under this subchapter. (b) Investigations The Secretary may investigate any matter the Secretary determines to be necessary to deter- mine the compliance of the recipients with this subchapter, including the regulations issued under this subchapter. The investigations au- thorized by this subsection may include exam- ining records (including making certified copies of the records), questioning employees, and en- tering any premises or onto any site in which any part of a program or activity of such a re- cipient is conducted or in which any of the records of the recipient are kept. (c) Additional requirement For the purpose of any investigation or hear- ing conducted under this subchapter by the Sec- retary, the provisions of section 49 of title 15 (re- lating to the attendance of witnesses and the production of documents) apply to the Sec- retary, in the same manner and to the same ex- tent as the provisions apply to the Federal Trade Commission. (Pub. L. 113–128, title I, § 183, July 22, 2014, 128 Stat. 1590.) Statutory Notes and Related Subsidiaries EFFECTIVE DATE Section effective on the first day of the first full pro- gram year after July 22, 2014 (July 1, 2015), see section 506 of Pub. L. 113–128, set out as a note under section 3101 of this title. § 3244. Fiscal controls; sanctions (a) Establishment of fiscal controls by States (1) In general Each State shall establish such fiscal con- trol and fund accounting procedures as may be necessary to assure the proper disbursal of, and accounting for, Federal funds allocated to local areas under part B. Such procedures shall ensure that all financial transactions carried out under part B are conducted and records maintained in accordance with gen- erally accepted accounting principles applica- ble in each State. (2) Cost principles (A) In general Each State (including the Governor of the State), local area (including the chief elect- ed official for the area), and provider receiv- ing funds under this subchapter shall comply with the applicable uniform cost principles included in appropriate circulars or rules 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 in- vestment activities in accordance with sec- tion 3174(a)(3)(B) of this title shall be allo- cable to the overall administration of work- force investment activities, but need not be specifically allocable to— (i) the administration of adult employ- ment and training activities; (ii) the administration of dislocated worker employment and training activi- ties; or (iii) the administration of youth work- force investment activities. (3) Uniform administrative requirements (A) In general Each State (including the Governor of the State), local area (including the chief elect- ed official for the area), and provider receiv- ing funds under this subchapter shall comply with the appropriate uniform administrative requirements for grants and agreements ap- plicable 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 sub- chapter between local boards and units of State or local governments shall be con- ducted 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 compli- ance with the uniform administrative require- ments referred to in paragraph (3). (5) Action by Governor If the Governor determines that a local area is not in compliance with the uniform admin- istrative requirements referred to in para- graph (3), the Governor shall— (A) require corrective action to secure prompt compliance with the requirements; and (B) impose the sanctions provided under subsection (b) 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 uni- form administrative requirements referred to in paragraph (3); (B) the State has monitored local areas to ensure compliance with the uniform admin- istrative requirements as required under paragraph (4); and (C) the State has taken appropriate action to secure compliance with the requirements pursuant to paragraph (5). (7) Action by the Secretary If the Secretary determines that the Gov- ernor has not fulfilled the requirements of this subsection, the Secretary shall— (A) require corrective action to secure prompt compliance with the requirements of this subsection; and Page 938 TITLE 29—LABOR § 3244 1 So in original. Subsec. (e) relates to termination or suspen- sion of financial assistance. (B) impose the sanctions provided under subsection (e) in the event of failure of the Governor to take the required appropriate action to secure compliance with the re- quirements. (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 spe- cific provision of this subchapter, and correc- tive action has not been taken, the Governor shall— (A) issue a notice of intent to revoke ap- proval of all or part of the local plan af- fected; or (B) impose a reorganization plan, which may include— (i) decertifying the local board involved; (ii) prohibiting the use of eligible pro- viders; (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 such other changes as the Secretary or Governor determines to be necessary to secure compliance with the provision. (2) Appeal (A) In general The actions taken by the Governor pursu- ant to subparagraphs (A) and (B) of para- graph (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 take promptly an ac- tion required under paragraph (1), the Sec- retary shall take such action. (c) Repayment of certain amounts to the United States (1) In general Every recipient of funds under this sub- chapter shall repay to the United States amounts found not to have been expended in accordance with this subchapter. (2) Offset of repayment amount If the Secretary determines that a State has expended funds received under this subchapter in a manner contrary to the requirements of this subchapter, the Secretary may require re- payment by offsetting the amount of such ex- penditures against any other amount to which the State is or may be entitled under this sub- chapter, except as provided under subsection (d)(1). (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 in a manner contrary to the requirements of this subchapter, the Governor of the State may use an amount deducted under paragraph (4) to repay the funds, except as provided under sub- section (e).1 (4) Deduction by State The Governor may deduct an amount equal to the misexpenditure described in paragraph (3) from subsequent program year (subsequent to the program year for which the determina- tion was made) allocations to the local area from funds reserved for the administrative costs of the local programs involved, as appro- priate. (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 with this subchapter within such local area with regard to appropriate expenditures of funds under this subchapter. (d) Repayment of amounts (1) In general Each recipient of funds under this sub- chapter shall be liable to repay the amounts described in subsection (c)(1), from funds other than funds received under this subchapter, upon a determination by the Secretary that the misexpenditure of the amounts was due to willful disregard of the requirements of this subchapter, gross negligence, failure to ob- serve accepted standards of administration, or a pattern of misexpenditure described in sub- section (c)(1). No such determination shall be made under this subsection or subsection (c) until notice and opportunity for a fair hearing have been given to the recipient. (2) Factors in imposing sanctions In determining whether to impose any sanc- tion authorized by this section against a re- cipient of funds under this subchapter for vio- lations of this subchapter (including applica- ble regulations) by a subgrantee or contractor of such recipient, the Secretary shall first de- termine whether such recipient has ade- quately demonstrated that the recipient has— (A) established and adhered to an appro- priate system, for entering into and moni- toring subgrant agreements and contracts with subgrantees and contractors, that con- tains acceptable standards for ensuring ac- countability; (B) entered into a written subgrant agree- ment or contract with such a subgrantee or contractor that established clear goals and obligations in unambiguous terms; (C) acted with due diligence to monitor the implementation of the subgrant agreement or contract, including carrying out the ap- propriate monitoring activities (including audits) at reasonable intervals; and (D) taken prompt and appropriate correc- tive action upon becoming aware of any evi- Page 939 TITLE 29—LABOR § 3245 dence of a violation of this subchapter, in- cluding regulations issued under this sub- chapter, by such subgrantee or contractor. (3) Waiver If the Secretary determines that the recipi- ent has demonstrated substantial compliance with the requirements of paragraph (2), the Secretary may waive the imposition of sanc- tions authorized by this section upon such re- cipient. The Secretary is authorized to impose any sanction consistent with the provisions of this subchapter and with any applicable Fed- eral or State law directly against any sub- grantee or contractor for violation of this sub- chapter, including regulations issued under this subchapter. (e) Immediate termination or suspension of as- sistance in emergency situations In emergency situations, if the Secretary de- termines 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 finan- cial assistance, in whole or in part, to the recipi- ent 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 sub- section, other than to an officer whose appoint- ment is required to be made by and with the ad- vice and consent of the Senate. (f) Discrimination against participants If the Secretary determines that any recipient under this subchapter has discharged or in any other manner discriminated against a partici- pant or against any individual in connection with the administration of the program in- volved, 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 subchapter, or has testified or is about to testify in any such proceeding or an investigation under or related to this sub- chapter, or otherwise unlawfully denied to any individual a benefit to which that individual is entitled under the provisions of this subchapter, including regulations issued under this sub- chapter, the Secretary shall, within 30 days, take such action or order such corrective meas- ures, as necessary, with respect to the recipient or the aggrieved individual, or both. (g) Remedies The remedies described in this section shall not be considered to be the exclusive remedies available for violations described in this section. (Pub. L. 113–128, title I, § 184, July 22, 2014, 128 Stat. 1590.) Statutory Notes and Related Subsidiaries EFFECTIVE DATE Section effective on the first day of the first full pro- gram year after July 22, 2014 (July 1, 2015), see section 506 of Pub. L. 113–128, set out as a note under section 3101 of this title. § 3245. Reports; recordkeeping; investigations (a) Recipient recordkeeping and reports (1) In general Recipients of funds under this subchapter shall keep records that are sufficient to per- mit the preparation of reports required by this subchapter and to permit the tracing of funds to a level of expenditure adequate to ensure that the funds have not been spent unlawfully. (2) Records and reports regarding general per- formance Every such recipient shall maintain such records and submit such reports, in such form and containing such information, as the Sec- retary may require regarding the performance of programs and activities carried out under this subchapter. Such records and reports shall be submitted to the Secretary but shall not be required to be submitted more than once each quarter unless specifically requested by Congress or a committee of Congress, in which case an estimate regarding such infor- mation may be provided. (3) Maintenance of standardized records In order to allow for the preparation of the reports required under subsection (c), such re- cipients shall maintain standardized records for all individual participants and provide to the Secretary a sufficient number of such records to provide for an adequate analysis of the records. (4) Availability to the public (A) In general Except as provided in subparagraph (B), records maintained by such recipients pursu- ant to this subsection shall be made avail- able to the public upon request. (B) Exception Subparagraph (A) shall not apply to— (i) information, the disclosure of which would constitute a clearly unwarranted in- vasion of personal privacy; and (ii) trade secrets, or commercial or fi- nancial information, that is— (I) obtained from a person; and (II) privileged or confidential. (C) Fees to recover costs Such recipients may charge fees sufficient to recover costs applicable to the processing of requests for records under subparagraph (A). (b) Investigations of use of funds (1) In general (A) Secretary In order to evaluate compliance with the provisions of this subchapter, the Secretary shall conduct, in several States, in each fis- cal year, investigations of the use of funds received by recipients under this subchapter. (B) Comptroller general of the United States In order to ensure compliance with the provisions of this subchapter, the Comp- troller General of the United States may conduct investigations of the use of funds re-