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§ 10.2 Definitions.

(a) "Departmental Fellowship Review Panel" (also referred to as "Panel") means a panel of 12 members selected by the Secretary, for such terms as may be designated by him, which shall include at least four representatives of the legal discipline and at least four representatives of the field of higher education. At least eight members of the Panel shall be selected from sources outside the Department.

(b) "Panel Chairman" means one of the Panel members designated by the Secretary to serve as Chairman of the Panel for such time as shall be indicated in the designation.

(c) "Departmental Fellowship Review Board" (also referred to as "Board") means not less than three members of the Panel designated by the Panel Chairman for the consideration of one or more cases submitted by a constituent agency. At least two Board members shall be persons other than employees of the Department, and the Board shall include at least one representative of the legal discipline and one from the field of higher education. In no event shall anyone who participated in any previous consideration of a case be eligible to serve on a board in connection with its consideration of that case. The Panel Chairman may designate himself as one of the members of a Board or as the Chairman thereof.

(d) "Board Chairman" means a member of a Departmental Fellowship Review Board who has been designated as Chairman of such Board by the Panel Chair

man.

(e) "Constituent agency" means the U.S. Commissioner of Education or the Commissioner of Vocational Rehabilita

tion.

(f) "Submission by a constituent agency" means a referral (of an individual's request for a hearing) by the U.S. Commissioner of Education pursuant to § 147.5 of this title or by the Commissioner of Vocational Rehabilitation pursuant to § 401.88a of this title, or similar provisions contained in manual or other issuances of a constituent agency.

(g) "Preliminary decision" means the recommended decision, including findings of fact and conclusions reached in the light of the applicable criteria, prepared by a Hearing Officer and submitted to the Board.

(h) "Initial decision" means the recommended decision of the Board, which shall include (1) findings of fact and conclusions reached in the light of the applicable criteria and, when applicable, (2) the reasons for any changes or modifications made by the Board in a preliminary decision.

(i) The words "Department" and "Departmental" refer to the U.S. Department of Health, Education, and Welfare.

(j) "Secretary" means the Secretary of Health, Education, and Welfare.

(k) "Applicable criteria" means those set forth in § 147.4 of this title in the case of a submission by the Commissioner of Education; or in § 401.88a (a) and (b) of this title in the case of a submission by the Commissioner of Vocational Rehabilitation; or in manual or other issuances of a constituent agency pertaining to denial or discontinuance of fellowship (or traineeship) awards on grounds involving moral character or loyalty. § 10.3 Departmental Fellowship Review Panel; Departmental Fellowship Review Board; in general.

Upon receipt of a submission from a constituent agency, the Chairman of the Departmental Fellowship Review Panel shall refer the case to a Departmental Fellowship Review Board, constituted as provided in § 10.2(c), for the purpose of recommending to the constituent agency, on the basis of a preponderance of the evidence, after affording to the individual concerned an opportunity for a fair hearing, whether the fellowship (or traineeship) award should be denied or discontinued by the constituent agency making the awards, on grounds involving, in accordance with applicable criteria, the moral character or loyalty of the applicant for, or holder of the award. The Board's recommendation shall be embodied in an initial decision in accordance with § 10.2(h).

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plicable laws, regulations, and other requirements (e.g., those pertaining to FBI reports);

(d) An opportunity to appear in person (and to present witnesses in his behalf) or, at the option of the individual concerned, to submit his case in whole or in part in writing (e.g., through interrogatories, affidavits, exhibits, etc.);

(e) An opportunity to cross-examine persons either orally or through written interrogatories, to the extent provided by Executive Order 10865 of February 20, 1960 (relating to safeguarding of classified information within industry), except that functions vested by that Order in the head of a department shall be performed by the head of the appropriate operating agency;

(f) An option to the individual concerned to have the hearing open or closed to the public;

(g) A determination of the place of the hearing which takes into consideration the convenience of the individual concerned and any witnesses who might be testifying at the hearing.

§ 10.5 Hearing before Board or a Hearing Officer.

The hearing may be conducted, as determined by the Board Chairman, before the full Board as the hearing body, or before a Hearing Officer. The Hearing Officer may be (a) one of the members of the Board or (b) a nonmember who is qualified as a Hearing Officer under the Administrative Procedure Act.

§ 10.6 Preliminary decision; initial decision; final decision.

When the hearing is conducted by the Board itself, it shall prepare an initial decision for submission to the constituent agency. When the hearing is conducted before a Hearing Officer, the Hearing Officer shall prepare a preliminary decision for submission to the Board. The preliminary decision shall be reviewed by the Board and shall become the initial decision of the Board unless, and to the extent that, it is changed or modified by the Board. The initial decision of the Board shall be transmitted to the constituent agency, and shall become the final decision of the constituent agency, unless, and to the extent that, it is changed or modified by the constituent agency.

8 10.7 Notice to the individual concerned and opportunity to submit comment

on preliminary decision and initial decision.

Copies of the preliminary decision, if any, and of the initial decision shall be mailed promptly by the Hearing Officer or the Board, as the case may be, to the individual, or his counsel, with a notice affording him an opportunity to submit written comments thereon, within a specified reasonable time, to the Board in the case of a preliminary decision, and to the constituent agency in the case of an initial decision.

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12.14 Compliance inspections and reports. Exhibit A-Department of Health, Education, and Welfare, Office of Surplus Property Utilization, Public Benefit Allowance for Transfer of Real Property for Educational Purposes.

Exhibit B-Department of Health, Education, and Welfare, Office of Surplus Property Utilization, Public Benefit Allowance Formula for Transfer of Real Property for Health Purposes.

AUTHORITY: The provisions of this Part 12 issued under sec. 203, 63 Stat. 385 as amended; 40 U.S.C. 484.

SOURCE: The provisions of this Part 12 appear at 33 F.R. 11399, Aug. 10, 1968, unless otherwise noted.

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level, such as a State Board of Education or Health, State University, Middle States Association of College of Surgeons, etc. A college, university, or secondary school may be said to be accredited if the credits are accepted for transfer purposes by no fewer than three accredited colleges, universities, or secondary schools not connected or associated with it.

(c) "Administrator" means the Administrator of General Services.

(d) "Assigned property" means real and related personal property which, in the discretion of the Administrator or his designee, has been made available to the Department for transfer for educational or for public health purposes, including research.

(e) "Department" means the Department of Health, Education, and Welfare.

(f) "Disposal agency" means the executive agency of the Government which has authority to assign or to consider assignment of property to the Department for transfer for health and educational utilization.

(g) "Excess" when used with respect to real property means any real property under the control of any Department or agency in the executive branch of the Government which is not required for its needs and the discharge of its responsibilities as determined by the head thereof.

(h) "Fair market value" means the highest price estimated in terms of money which the property will bring if exposed for sale in the open market by a seller who is willing but not obliged to sell, allowing a reasonable time to find a buyer who is willing but not obliged to buy, both parties having full knowledge of all the uses to which it is adapted and for which it is capable of being used.

(i) "Holding Agency" means the executive agency of the Government which has control and accountability for the real property involved.

(j) "Nonprofit institution" as used in this part means any institution, organization, or association, whether incorporated or unincorporated, no part of the net earnings of which inures or may lawfully inure to the benefit of any private shareholder or individual, and which has been held by the Internal Revenue Service to be tax-exempt under either the provisions of section 101 (6) of the 1939 Internal Revenue Code, or section 501 (c) (3) of the 1954 Internal Revenue Code.

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(k) "Off-site property" means surplus buildings, underground utilities and all other removable improvements, including related personal property, to be transferred where located, by the Department for educational or for public health purposes, including research, for removal and use away from the site.

(1) "On-site" means surplus real property, including related personalty, to be transferred by the Department for educational or for public health purposes, including research, for use in place.

(m) "Public benefit allowance" means a discount on the purchase price of real property to be transferred for educational or public health purposes, including research, representing any benefit determined by the Secretary which has accrued or may accrue to the United States from use of surplus real property for educational or public health purposes, including research.

(n) "Related personal property" means any personal property, (1) which is located on and is (i) an integral or necessary part of, or is (ii) essential to the operation of real property, or (2) which is determined by the Administrator to be otherwise related to the real property.

(o) "Secretary" means the Secretary of Health, Education, and Welfare.

(p) "State" means a State of the United States, the District of Columbia, the Commonwealth of Puerto Rico, and the territories and possessions of the United States.

(q) "Surplus" when used with respect to real property means any excess real property not required for the needs and the discharge of the responsibilities of all Federal agencies as determined by the Administrator or his designee.

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instrumentalities, tax-supported educational or public health institutions, and nonprofit educational or public health institutions which have been held exempt from taxation under section 101 (6) of the Internal Revenue Code of 1939 (now substantially reenacted in section 501(c)(3) of the Internal Revenue Code of 1954).

(c) Real property will be requested for assignment only when the Department has determined that the property is suitable and needed for public health or educational purposes. The amounts of both real and related personal property to be transferred shall not be excessive to normal operating requirements. Such property, except for transfers contemplated under § 12.10 will not be requested for assignment unless it is needed at the time of application for educational or for public health purposes, including research, or unless it will be so needed within the immediate foreseeable future. When construction is contemplated, the initiation of construction of the major functional facility in the approved program must begin within 18 months after the date of transfer. Construction shall be deemed to have been initiated when the transferee executes a contract providing a firm date in the reasonably near future for actual commencement of construction. The Department may, in its discretion, grant extensions of the 18-month period where the transferee can factually demonstrate that it has exercised due diligence in attempting to initiate construction within the said period and that such construction will be initiated during the period of any such extension.

(d) Land may be requested for assignment for transfer in accordance with § 12.10, for public tax-supported educational and public health purposes where, although there is no immediate need for the property, population trends, location, present facilities and plans for additional facilities justify immediate transfer to reasonably provide for future needs.

(e) Transfers will be made only when the proposed program is not in conflict with State or local zoning restrictions, building codes, or similar limitations.

(f) Only those activities devoted to academic, vocational or professional instruction, or organized and operated to promote and protect the public health, are eligible. Examples of such eligible activities are universities, colleges, junior colleges, junior or senior high schools,

elementary schools or school systems, vocational or specialized schools, research activities, public libraries, and similar activities primarily educational in character, general and specialty hospitals, mental institutions, clinics, health sanitation activities (including water and sewer departments), facilities providing public health services, and similar activities devoted primarily to the protection and promotion of public health. The program of an institution eligible for a transfer must contemplate use of the property as an integral part of an activity of the kind above described. The activity must obtain such licenses for operations as may be required by State and local law.

(g) Use of the property applied for must be for a fundamental educational or public health purpose. Examples of such fundamental utilizations are classrooms, vocational shops, libraries, laboratories, auditoriums, gymnasiums, cafeterias, dormitories, faculty housing, infirmaries, recreational facilities, hospitals, clinics, facilities providing public health services, and similar utilization. The property applied for must be for a purpose for which the eligible organization would be authorized to expend its own funds to acquire.

(h) An applicant's plan of operation shall not be approved unless it includes a provision that the applicant will not discriminate because of race, color, creed, or national origin in the use of any portions of the property.

§ 12.4 Limitations.

(a) Surplus property transferred pursuant to this part shall be disposed of "as is," "where is," and without warranty of any kind.

(b) Unless excepted by the General Services Administration from the assignment of property to this Department, mineral rights will, in all cases, be conveyed together with the surface rights. However, where the property to be conveyed overlies a known mineral structure of commercial value, the Department, in its discretion will:

(1) Convey the mineral rights separately from the surface rights upon payment by the transferee of the fair value thereof, as determined by the Department, without application of the public benefit allowance; or

(2) Convey the mineral rights together with the surface rights with the requirement in the conveyance instrument that,

during the period of restricted use, all revenues or the reasonable value, as determined by the Department, of benefits to the transferee deriving directly or indirectly from any and all mineral leases or royalties shall be considered to have been received and held in trust by the transferee for the United States and shall be subject to direction and control of the Department, together with a reservation to the Government, in the conveyance instrument, at its option, to revert title to any and all mineral interests conveyed at any time during the period of restricted use.

§ 12.5 Awards.

Where there is more than one applicant for the same property, the following principles shall be observed:

(a) Greater consideration will be given to programs of utilization most nearly consistent with the Government's purpose in acquiring or using the property. For instance, a surplus hospital will be considered for transfer for a health program in preference to an educational program if all other factors are equal.

(b) Property will be awarded to the applicant having a program of utilization which provides, in the opinion of the Department, the greatest public benefit.

(c) The Department will have, as an objective, the apportionment of an available property to fit the needs of as many applicant health and educational programs as is practicable.

§ 12.6 Notice of available property.

Reasonable publicity shall be given to the availability of surplus real property which is suitable for assignment to the Department for disposal for educational or public health use. The Department shall establish procedures reasonably calculated to afford all eligible users having a legitimate interest in acquiring property for educational or public health purposes including research who show due diligence a full and complete opportunity to make an application therefor: Provided. however, That publicity need not be given as to the availability of surplus real property which is occupied and being used by an applicant for eligible educational or public health purposes, including research, at the time the property is declared excess and the Department determines that the applicant has a continuing need for the property.

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(a) Notice of interest in a specific property for educational or public health utilization shall be furnished the General Services Administration or other agency having disposal jurisdiction by the Department at the earliest possible date.

(b) Requests to the Administrator, or his designee disposal agency, for assignment of surplus real property to the Department for disposal for educational and public health purposes, including research, shall be based on the following conditions:

(1) There is an acceptable application for the property of record with the Department.

(2) The applicant is willing, authorized, and in a position to assume immediate care, custody, and maintenance of the property.

(3) The applicant is able, willing and authorized to pay the external administrative expenses incident to a transfer.

(c) A copy of each request for assignment of surplus real property shall be furnished the holding agency.

§ 12.9 General disposal terms and conditions.

(a) Surplus real property disposals under this part shall be limited to transactions which are primarily for educational or public health purposes, including research. Transferees shall be entitled to public benefit allowances which shall be applied against the sale price of the property to be conveyed. These allowances will be computed in consideration of benefits which have accrued or may accrue to the United States from the use of such property for educational or

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