20 U.S. Code § 1232c - State agency monitoring and enforcement
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(a) State plan
In the case of any applicable program in which Federal funds are made available to local agencies in a State through or under the supervision of a State board or agency, the Secretary may require the State to submit a plan for monitoring compliance by local agencies with Federal requirements under such program and for enforcement by the State of such requirements. The Secretary may require such plan to provide—
(1) for periodic visits by State personnel of programs administered by local agencies to determine whether such programs are being conducted in accordance with such requirements;
(2) for periodic audits of expenditures under such programs by auditors of the State or other auditors not under the control, direction, or supervision of the local educational agency; and
(b) State enforcement of Federal requirements
In order to enforce the Federal requirements under any applicable program the State may—
(1) withhold approval, in whole or in part, of the application of a local agency for funds under the program until the State is satisfied that such requirements will be met; except that the State shall not finally disapprove such an application unless the State provides the local agency an opportunity for a hearing before an impartial hearing officer and such officer determines that there has been a substantial failure by the local agency to comply with any of such requirements;
(2) suspend payments to any local agency, in whole or in part, under the program if the State has reason to believe that the local agency has failed substantially to comply with any of such requirements, except that
(A) the State shall not suspend such payments until fifteen days after the State provides the local agency an opportunity to show cause why such action should not be taken and
(B) no such suspension shall continue in effect longer than sixty days unless the State within such period provides the notice for a hearing required under paragraph (3) of this subsection;
(c) Withholding of payments
Any withholding of payments under subsection (b)(3) of this subsection  shall continue until the State is satisfied that there is no longer a failure to comply substantially with any of such requirements.
 So in original. Probably should be “section”.
Source(Pub. L. 90–247, title IV, § 440, formerly § 434, as added Pub. L. 95–561, title XII, § 1231(a)(3),Nov. 1, 1978, 92 Stat. 2342; renumbered § 440 and amended Pub. L. 103–382, title II, §§ 212(b)(1), 261 (e),Oct. 20, 1994, 108 Stat. 3913, 3927.)
A prior section 1232c,Pub. L. 90–247, title IV, § 434, formerly § 424, as added Pub. L. 91–230, title IV, § 401(a)(10),Apr. 13, 1970, 84 Stat. 169; renumbered § 434 and amended Pub. L. 92–318, title III, § 301(a)(1), title V, § 501,June 23, 1972, 86 Stat. 326, 345; Pub. L. 93–380, title V, §§ 510, 511 (a),Aug. 21, 1974, 88 Stat. 568, 569; Pub. L. 94–482, title V, § 501(f)(1),Oct. 12, 1976, 90 Stat. 2237, related to administration of education programs and projects, prior to repeal by section 1231(a)(3) ofPub. L. 95–561.
A prior section 440 ofPub. L. 90–247was renumbered section 446, and is classified to section 1232i of this title.
1994—Pub. L. 103–382, § 261(e)(1), struck out “educational” after “State” in section catchline.
Subsec. (a). Pub. L. 103–382, § 261(e)(2)(A), substituted “Secretary” for “Commissioner” wherever appearing.
Subsecs. (b), (c). Pub. L. 103–382, § 261(e)(2)(B), (C), redesignated provision following par. (3) of subsec. (b) assubsec. (c) and substituted “subsection (b)(3)” for “paragraph (3)”.
Pub. L. 95–561, title XII, § 1261,Nov. 1, 1978, 92 Stat. 2356, provided that: “The amendments made by section 1231 [enacting this section and sections 1232d, 1232e, and 1232f of this title and amending section 1088f–1 of this title] shall take effect with respect to appropriations for fiscal year 1980 and subsequent fiscal years. The amendments made by section 1232 [enacting sections 1234, 1234a, 1234b, 1234c, 1234d, and 1234e of this title] shall take effect 120 days after the enactment of this Act [Nov. 1, 1978].”
Applicability of Administrative Procedure to Office of Education or Actions by Commissioner Unaffected by Subsections (b) to (e)
Pub. L. 93–380, title V, § 511(b)(2),Aug. 21, 1974, 88 Stat. 571, provided that nothing in the amendment made by subsec. (a) ofsection 511 of Pub. L. 93–380, which enacted prior subsecs. (b) to (e) and deleted former subsec. (b) of this section, would be construed to affect the applicability of chapter 5 of Title 5, Government Organization and Employees, to the Office of Education or actions by the Commissioner.