The Rehabilitation Act of 1973, as amended, (Rehabilitation Act) authorizes the Commissioner of the Rehabilitation Services Administration (RSA) to reallot to other grant recipients that portion of a recipient’s annual grant that cannot be used. The reallotment process maximizes the use of appropriated funds under the State Vocational Rehabilitation Services (VR), Independent Living Services for Older Individuals Who are Blind (OIB), State Supported Employment Services (Supported Employment), Client Assistance Program (CAP), and Protection and Advocacy for Individual Rights (PAIR) formula grant programs. Each formula grant recipient is required to submit a Grant Reallotment Form to RSA during the reallotment period of the Federal fiscal year (FFY) in which the funds were awarded to determine whether the grantee is relinquishing grant funds, requesting additional grant funds, or seeking no change in the current award amount. If ample funds are not relinquished for an award, RSA will exercise its discretion to cancel any scheduled reallotment for that program. RSA will notify grantees if a reallotment has been cancelled.
Section 19(a) of the Rehabilitation Act authorizes formula grantees to carry over any funds appropriated, including original allotments and reallotments, which are not obligated or expended by recipients by September 30th of the FFY of appropriation. Funds carried over remain available for obligation and expenditure during the following fiscal year, provided the grantee has fully met, by September 30th of the FFY of appropriation, any matching requirement of the funds to be carried over.
Funds received during reallotment are considered an increase to the State’s allotment for the FFY for which funds were appropriated (see Sections 110(b)(3), 112(e)(2), 509(e), and 603(b) of the Rehabilitation Act and 34 C.F.R. § 367.32(d)). As such, any VR or Supported Employment funds received or relinquished during reallotment will affect a State’s calculation of the amount of funds to be reserved and expended for the provision of pre-employment transition services under the VR program and the amount to be reserved and expended for the provision of Supported Employment services, including extended services, to youth with the most significant disabilities under the Supported Employment program (CFDA 84.187B) (Sections 110(d)(1) and 603(d) of the Rehabilitation Act), respectively.
Because a State’s Supported Employment allotment refers to the total amount of CFDA 84.187A and CDFA 84.187B funds awarded pursuant to Section 603 of the Rehabilitation Act, the total allotment amount must remain balanced in order to comply with the statutory requirements for a State to reserve and expend funds for the provision of supported employment services for youth with the most significant disabilities and the requirement to provide match for the half of the allotment reserved for youth with the most significant disabilities (50 percent of award in CFDA 84.187A and 50 percent in CFDA 84.187B). In order to maintain this balance during the reallotment process, grantees only directly enter amounts on the RSA-692 form for the Supported Employment-A (CFDA 84.187A) award. The amount of Supported Employment-A funds relinquished or requested will be automatically assigned, in an equal amount, to the Supported Employment-B (CFDA 84.187B) program. For example, if a grantee enters a relinquishment amount of $100,000 in Supported Employment-A funds, the RSA-692 form for the Supported Employment-B award will automatically indicate relinquishment of $100,000.
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