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SEC. 1238. AWARD OF SUBGRANTS.

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    (a) SELECTION PROCESS-
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    • (1) IN GENERAL- The State educational agency shall establish a review panel in accordance with paragraph (3) that will approve applications that —
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      • (A) are most likely to be successful in —
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        • (i) meeting the purpose of this subpart; and
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        • (ii) effectively implementing the program elements required under section 1235;
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      • (B) demonstrate that the area to be served by the program has a high percentage or a large number of children and families who are in need of those services as indicated by high levels of poverty, illiteracy, unemployment, limited English proficiency, or other need-related indicators, such as a high percentage of children to be served by the program who reside in a school attendance area served by a local educational agency eligible for participation in programs under part A, a high number or percentage of parents who have been victims of domestic violence, or a high number or percentage of parents who are receiving assistance under a State program funded under part A of title IV of the Social Security Act (42 U.S.C. 601 et seq.);
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      • (C) provide services for at least a 3-year age range, which may begin at birth;
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      • (D) demonstrate the greatest possible cooperation and coordination between a variety of relevant service providers in all phases of the program;
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      • (E) include cost-effective budgets, given the scope of the application;
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      • (F) demonstrate the applicants ability to provide the non-Federal share required by section 1234(b);
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      • (G) are representative of urban and rural regions of the State; and
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      • (H) show the greatest promise for providing models that may be adopted by other family literacy projects and other local educational agencies.
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    • (2) PRIORITY FOR SUBGRANTS- The State educational agency shall give priority for subgrants under this subsection to applications that —
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      • (A) target services primarily to families described in paragraph (1)(B); or
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      • (B) are located in areas designated as empowerment zones or enterprise communities.
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    • (3) REVIEW PANEL- A review panel shall consist of at least three members, including one early childhood professional, one adult education professional, and one individual with expertise in family literacy programs, and may include other individuals, such as one or more of the following:
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      • (A) A representative of a parent-child education organization.
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      • (B) A representative of a community-based literacy organization.
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      • (C) A member of a local board of education.
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      • (D) A representative of business and industry with a commitment to education.
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      • (E) An individual who has been involved in the implementation of programs under this title in the State.
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    (b) DURATION-
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    • (1) IN GENERAL- Subgrants under this subpart may be awarded for a period not to exceed 4 years.
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    • (2) STARTUP PERIOD- The State educational agency may provide subgrant funds to an eligible recipient, at the recipients request, for a 3- to 6-month start-up period during the first year of the 4-year grant period, which may include staff recruitment and training, and the coordination of services, before requiring full implementation of the program.
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    • (3) CONTINUING ELIGIBILITY- In awarding subgrant funds to continue a program under this subpart after the first year, the State educational agency shall review the progress of each eligible entity in meeting the objectives of the program referred to in section 1237(c)(1)(A) and shall evaluate the program based on the indicators of program quality developed by the State under section 1240.
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    • (4) INSUFFICIENT PROGRESS- The State educational agency may refuse to award subgrant funds to an eligible entity if the agency finds that the eligible entity has not sufficiently improved the performance of the program, as evaluated based on the indicators of program quality developed by the State under section 1240, after —
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      • (A) providing technical assistance to the eligible entity; and
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      • (B) affording the eligible entity notice and an opportunity for a hearing.
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    • (5) GRANT RENEWAL- (A) An eligible entity that has previously received a subgrant under this subpart may reapply under this subpart for additional subgrants.
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    • (B) The Federal share of any subgrant renewed under subparagraph (A) shall be limited in accordance with section 1234(b).