What Conditions Must Be Met by a Grantee?

34 C.F.R. Part ..., Subpart C
in effectEffective: 2024-07-01

34 C.F.R. § 225.20 When may a grantee draw down funds?

(a) A grantee may draw down funds after it has signed a performance agreement acceptable to the Department of Education and the grantee. (b) A grantee may draw down and spend a limited amount of funds prior to reaching an acceptable performance agreement provided that the grantee requests to draw down and spend a specific amount of funds and the Department of Education approves the request in writing.

34 C.F.R. § 225.21 What are some examples of impermissible uses of reserve account funds?

(a) Grantees must not use reserve account funds to— (1) Directly pay for a charter school's construction, renovation, repair, or acquisition; or (2) Provide a down payment on facilities in order to secure loans for charter schools. A grantee may, however, use funds to guarantee a loan for the portion of the loan that would otherwise have to be funded with a down payment. (b) In the event of a default of payment to lenders or contractors by a charter school whose loan or lease is guaranteed by reserve account funds, a grantee may use these funds to cover defaulted payments that are referenced under paragraph (a)(1) of this section.

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