Settlement Guidelines

The Panel must approve any settlement. Local educational agencies (LEAs) and other parties to an action that is proceeding pursuant to the Administrative Procedure Act may request settlement discussions at any time during the appeal process, including during any prehearing conference. The parties to an appeal may also negotiate and present a proposed settlement by mailing the stipulation with original signatures or appropriate electronic signatures for approval by the Panel. Unless the Office of Administrative Hearings (OAH) has played a role in the settlement process, there is no need to present the stipulation to the Administrative Law Judge.

While the parties may agree on a compromise figure, a settlement agreement may not make findings of fact, interpretations of law, or determinations of substantial compliance. Such findings would usurp the fact-finding and decision-making process entrusted to the Panel, which requires a formal evidentiary hearing, a proposed decision by an administrative law judge, and a decision by the Panel with regard to the proposed decision.

A settlement stipulation should include the:

  • EAAP case number and OAH case number.
  • Audit year, and finding number(s) with original dollar amount(s) subject to the stipulation.
  • Settlement dollar amount(s) and any approved repayment terms.
  • Referenced attachments and/or exhibits.

A stipulation should not:

  • Predicate its result on any determinations the parties make as to factual or legal error in the audit finding, or belief that the appellant was in substantial compliance (judgments that only the Panel can make after a formal hearing).
  • Cite audit guide sections in lieu of substantive law, if any citation to the law relating to the audit finding(s) is made. The audit guide provides direction to auditors; it does not establish legal requirements for LEAs.
  • Direct the Department of Education on the manner or timing in which any offset should be made. (However, use of the phrase “withheld from its future apportionment” may be appropriate.)
  • Require approval by OAH before submission to EAAP.
  • Include a statement that the appeal will be withdrawn if the settlement is approved by the Panel.

When circulating and signing the final version of the settlement stipulation, ensure that details such as case numbers, audit year(s), finding number(s), and amount(s) are accurately and consistently stated.