118 STAT. 764 PUBLIC LAW 108–265—JUNE 30, 2004 ‘‘(A) DEFINITION OF SELECTED LOCAL EDUCATIONAL AGENCIES.—In this paragraph, the term ‘selected local edu cational agency’ means a local educational agency that has a demonstrated high level of, or a high risk for, administrative error, as determined by the Secretary. ‘‘(B) ADDITIONAL ADMINISTRATIVE REVIEW.—In addition to any review required by subsection (a) or paragraph (1), each State educational agency shall conduct an administrative review of each selected local educational agency during the review cycle established under sub section (a). ‘‘(C) SCOPE OF REVIEW.—In carrying out a review under subparagraph (B), a State educational agency shall only review the administrative processes of a selected local edu cational agency, including application, certification, verification, meal counting, and meal claiming procedures. ‘‘(D) RESULTS OF REVIEW.—If the State educational agency determines (on the basis of a review conducted under subparagraph (B)) that a selected local educational agency fails to meet performance criteria established by the Secretary, the State educational agency shall— ‘‘(i) require the selected local educational agency to develop and carry out an approved plan of corrective action; ‘‘(ii) except to the extent technical assistance is provided directly by the Secretary, provide technical assistance to assist the selected local educational agency in carrying out the corrective action plan; and ‘‘(iii) conduct a followup review of the selected local educational agency under standards established by the Secretary. ‘‘(4) RETAINING FUNDS AFTER ADMINISTRATIVE REVIEWS.— ‘‘(A) IN GENERAL.—Subject to subparagraphs (B) and (C), if the local educational agency fails to meet administra tive performance criteria established by the Secretary in both an initial review and a followup review under para graph (1) or (3) or subsection (a), the Secretary may require the State educational agency to retain funds that would otherwise be paid to the local educational agency for school meals programs under procedures prescribed by the Sec retary. ‘‘(B) AMOUNT.—The amount of funds retained under subparagraph (A) shall equal the value of any overpayment made to the local educational agency or school food authority as a result of an erroneous claim during the time period described in subparagraph (C). ‘‘(C) TIME PERIOD.—The period for determining the value of any overpayment under subparagraph (B) shall be the period— ‘‘(i) beginning on the date the erroneous claim was made; and ‘‘(ii) ending on the earlier of the date the erroneous claim is corrected or— ‘‘(I) in the case of the first followup review conducted by the State educational agency of the local educational agency under this section after
�
