ETA
Final Rule
Workforce Investment Act; Interim Final Rule
[04/15/99]
Volume 64, Number 72, Page 18661-18710
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_______________________________________________________________________
Part II
Department of Labor
_______________________________________________________________________
Employment and Training Administration
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20 CFR Part 652, et al.
Workforce Investment Act; Interim Final Rule
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DEPARTMENT OF LABOR
Employment and Training Administration
20 CFR Part 652 and Parts 660 through 671
RIN 1205-AB20
Workforce Investment Act
AGENCY: Employment and Training Administration (ETA), Labor.
ACTION: Interim Final Rule; request for comments.
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SUMMARY: The Department of Labor (DOL) is issuing an Interim Final Rule
implementing provisions of titles I, III and V of the Workforce
Investment Act. Through these regulations, the Department implements
the first major reform of the nation's job training system in more than
15 years. Key components of this reform include streamlining services
through a One-Stop service delivery, empowering individuals through
information and access to training resources through Individual
Training Accounts, providing universal access to core services,
increasing accountability for results, ensuring a strong role for Local
Boards and the private sector in the workforce investment system,
facilitating State and local flexibility, and improving youth programs.
DATES: This Interim Final Rule will become effective on May 17, 1999.
Comment Period: Comments must be submitted by July 14, 1999. The
Department cannot guarantee that comments received after this date will
be considered. Comments that are less than 10 pages in length may be
transmitted via a facsimile at (202) 219-0323 provided that submission
of written text follows. Commenters wishing acknowledgment of receipt
of their comments must submit them by certified mail, return receipt
requested. Also, comments may be sent electronically using the Internet
web page at http://usworkforce.org.
ADDRESSES: Submit written comments to the Employment and Training
Administration, Workforce Investment Act Implementation Taskforce, 200
Constitution Avenue, NW, Room S5513, Washington, DC 20210, Attention:
Eric Johnson.
All comments will be available for public inspection and copying
during normal business hours at the Employment and Training
Administration, Workforce Investment Act Implementation Taskforce, 200
Constitution Avenue, NW, Room S5513, Washington, DC 20210. Copies of
the Interim Final Rule are available in alternate formats of large
print and electronic file on computer disk, which may be obtained at
the above-stated address. The Interim Final Rule is also available on
the WIA website at http://usworkforce.org
In compliance with 28 U.S.C. 2112(a), the Employment and Training
Administration designates the Associate Solicitor for Employment and
Training Services, Office of the Solicitor, U.S. Department of Labor,
200 Constitution Avenue, NW, Room N-2101, Washington, DC 20210, as the
recipient of petitions to review this Interim Final Rule.
FOR FURTHER INFORMATION CONTACT: Mr. Eric Johnson, Workforce Investment
Act Implementation Taskforce Office, U.S. Department of Labor, 200
Constitution Avenue, NW, Room S5513, Washington, DC 20210, Telephone:
(202) 219-0316 (voice) (this is not a toll-free number) or 1-800-326-
2577 (TDD).
SUPPLEMENTARY INFORMATION:
Paperwork Reduction Act
Certain sections of this Interim Final Rule, such as Secs. 667.300,
667.900, 668.800, and 669.570 contain information collection
requirements. As required by the Paperwork Reduction Act of 1995 (44
U.S.C. 3507(d)), the Department of Labor has submitted a copy of these
sections to the Office of Management and Budget for its review.
Comments must be submitted by May 17, 1999 to: Desk Officer for the
Department of Labor, Employment Training Administration, Office of
Management and Budget, 725 17th Street, NW (Rm 10235), Washington DC
20503. Affected parties do not have to comply with the information
collection requirements in this document until DOL publishes in the
Federal Register the control numbers assigned by the Office of
Management and Budget (OMB). Publication of the control numbers
notifies the public that OMB has approved this information collection
requirement under the Paperwork Reduction Act of 1995. An OMB control
number (1205-0398) was issued for the WIA state planning guidance
authorized under 20 CFR 661.220, and published at 64 FR 9402 (Feb. 25,
1999).
I. Background
A. WIA Principles
On August 7, 1998, President Clinton signed the Workforce
Investment Act of 1998 (WIA), comprehensive reform legislation that
supersedes the Job Training Partnership Act (JTPA) and amends the
Wagner-Peyser Act. The WIA also contains the Adult Education and Family
Literacy Act (title II) and the Rehabilitation Act Amendments of 1998
(title IV). Guidance or regulations implementing titles II and IV will
be issued by the Department of Education.
The WIA reforms Federal job training programs and creates a new,
comprehensive workforce investment system. The reformed system is
intended to be customer-focused, to help Americans access the tools
they need to manage their careers through information and high quality
services, and to help U.S. companies find skilled workers.
This new law embodies seven key principles. They are:
<bullet> Streamlining services through better integration at the
street level in the One-Stop delivery system. Programs and providers
will co-locate, coordinate and integrate activities and information, so
that the system as a whole is coherent and accessible for individuals
and businesses alike.
<bullet> Empowering individuals in several ways. First, eligible
adults are given financial power to use Individual Training Accounts
(ITA's) at qualified institutions. These ITA's supplement financial aid
already available through other sources, or, if no other financial aid
is available, they may pay for all the costs of training. Second,
individuals are empowered with greater levels of information and
guidance, through a system of consumer reports providing key
information on the performance outcomes of training and education
providers. Third, individuals are empowered through the advice,
guidance, and support available through the One-Stop system, and the
activities of One-Stop partners.
<bullet> Universal access. Any individual will have access to the
One-Stop system and to core employment-related services. Information
about job vacancies, career options, student financial aid, relevant
employment trends, and instruction on how to conduct a job search,
write a resume, or interview with an employer is available to any job
seeker in the U.S., or anyone who wants to advance his or her career.
<bullet> Increased accountability. The goal of the Act is to
increase employment, retention, and earnings of participants, and in
doing so, improve the quality of the workforce to sustain economic
growth, enhance productivity and competitiveness, and reduce welfare
dependency. Consistent with this goal, the Act identifies core
indicators of performance that State and local entities managing the
workforce investment system must meet--or suffer sanctions. However,
State and local entities
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exceeding the performance levels can receive incentive funds. Training
providers and their programs also have to demonstrate successful
performance to remain eligible to receive funds under the Act. And
participants, with their ITA's, have the opportunity to make training
choices based on program outcomes. To survive in the market, training
providers must make accountability for performance and customer
satisfaction a top priority.
<bullet> Strong role for local workforce investment boards and the
private sector, with local, business-led boards acting as ``boards of
directors,'' focusing on strategic planning, policy development and
oversight of the local workforce investment system. Business and labor
have an immediate and direct stake in the quality of the workforce
investment system. Their active involvement is critical to the
provision of essential data on what skills are in demand, what jobs are
available, what career fields are expanding, and the identification and
development of programs that best meet local employer needs. Highly
successful private industry councils under JTPA exhibit these
characteristics now. Under WIA, this will become the norm.
<bullet> State and local flexibility. States and localities have
increased flexibility, with significant authority reserved for the
Governor and chief elected officials, to build on existing reforms in
order to implement innovative and comprehensive workforce investment
systems tailored to meet the particular needs of local and regional
labor markets.
<bullet> Improved youth programs linked more closely to local labor
market needs and community youth programs and services, and with strong
connections between academic and occupational learning. Youth programs
include activities that promote youth development and citizenship, such
as leadership development through voluntary community service
opportunities; adult mentoring and followup; and targeted opportunities
for youth living in high poverty areas.
Many States and local areas have already taken great strides in
implementing these principles, supported by grants from the Department
of Labor to build One-Stop service delivery systems and school-to-work
transition systems. The Act builds on these reforms and ensures that
they will be available throughout the country.
The Department wishes to emphasize that it considers the reforms
embodied in the Workforce Investment Act to be pivotal, and not
``business as usual.'' This legislation provides unprecedented
opportunity for major reforms that can result in a reinvigorated,
integrated workforce investment system. States and local communities,
together with business, labor, community-based organizations,
educational institutions, and other partners, must seize this historic
opportunity by thinking expansively as they design a customer-focused,
comprehensive delivery system.
The success of the reformed workforce investment system is
dependent on the development of true partnerships and honest
collaboration at all levels and among all stakeholders. While the
Workforce Investment Act and these regulations assign specific roles
and responsibilities to specific entities, for the system to realize
its potential necessitates moving beyond current categorical
configurations and institutional interests. Also, it is imperative that
input is received from all stakeholders and the public at each stage of
the development of State and local workforce investment systems.
The cornerstone of the new workforce investment system is One-Stop
service delivery which unifies numerous training, education and
employment programs into a single, customer-friendly system in each
community. The underlying notion of One-Stop is the coordination of
programs, services and governance structures so that the customer has
access to a seamless system of workforce investment services. It is
envisioned that a variety of programs could use common intake, case
management and job development systems in order to take full advantage
of the One-Stops' potential for efficiency and effectiveness. A wide
range of services from a variety of training and employment programs
will be available to meet the needs of employers and job seekers. The
challenge in making One-Stop live up to its potential is to make sure
that the State and Local Boards can effectively coordinate and
collaborate with the network of other service agencies, including TANF
agencies, transportation agencies and providers, metropolitan planning
organizations, child care agencies, nonprofit and community partners,
and the broad range of partners who work with youth.
B. Early Implementation
Many States have expressed interest in which features of WIA may be
phased-in after approval of the State workforce investment plan, and
how long they will have before they must be in full compliance.
<bullet> The planning guidance (which was published in the Federal
Register on February 25, 1999) and regulations specify that States may
submit a State workforce investment plan to the Department for approval
at any time between April 1, 1999 and April 1, 2000. For those States
that plan to transition to WIA prior to July 1, 2000, and do not have
all policies, procedures and systems fully developed, the State may
submit a Transition Plan that outlines when the State expects to have
each of the WIA components (for example, the One-Stop system, or the
Individual Training Account system) fully operational. All components
must be in place by July 1, 2000. Under this option, the Department
will conditionally approve the State workforce investment plan. The
State workforce investment plan will be fully approved once all of the
WIA components are in place. This option provides some flexibility for
early implementing States, while ensuring that full implementation is
completed for all States by July 1, 2000.
<bullet> States and local areas may use the current waiver
authority and allowable activities under JTPA, to plan for and
implement WIA reforms. Activities that are allowable during this phase
include: (1) Strategic planning; (2) establishment of State and local
workforce investment boards; (3) consultation with One-Stop partners;
(4) establishment of ITA systems; and (5) establishment of consumer
report systems.
<bullet> Because JTPA title II youth funds are available for
obligation on April 1, 1999, the Calendar Year 1999 Summer Youth
Employment and Training Program, and JTPA title II-C youth program
allocations have been made and are to be allocated by States to local
areas under the JTPA rules. The Department will issue transition
guidance which will provide further direction and specification.
<bullet> A 90 percent hold harmless provision for within-State
allocations for the youth and adult funding streams, that is based on
allocations in the first two years of WIA operation, becomes effective
in the third year a State operates under WIA. Structured to facilitate
creation of new local areas by freeing States from allocation formulas
established under JTPA, there is no hold harmless provision effective
in the first two years of a state's WIA implementation that would cover
the transition period from JTPA. The lack of a hold harmless provision
during this period could result in some instability during the early
stages of WIA implementation. However, Governors do have options
available to promote stability. For program year 1999 only, the
Governor may elect to utilize the
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JTPA hold harmless provision. However, in doing so, the two year hold
harmless is delayed for one year. Therefore, if a State elects to use
this option, the two year hold harmless would apply for PY 2000 and
2001 unless Congress decides to address this area with a technical
amendment. Also, Governors may use some of their 15 percent State
reserve funds to assist local areas that are negatively impacted by the
WIA funding formulas, or choose to adopt an adult or youth within-State
allocation formula that incorporates additional targeting factors,
provided for in sections 128 and 133 of WIA.
C. Rule Format
The format, as well as the substance, of the Interim Final Rule,
reflects the Administration's commitment to regulatory reform and to
writing regulations that are reader-friendly. The Department has
attempted to make these regulations clear and easy to understand, as
well as to anticipate issues that may arise and to provide appropriate
direction. To this end, the regulatory text is presented in a
``question and answer'' format. The Department has organized the
regulations in a way that will help those who must implement the new
system to recognize the various steps they must take as they develop
the organization and services that make up the workforce investment
system. In many cases, the provisions of WIA are not repeated in these
regulations. As requested by some interested parties, however, in a
number of instances, it was determined that the regulations would
provide context and be more reader-friendly if the Act's provisions
were included in an answer rather than merely cross-referencing the
statute.
Section 506(c)(1) of the Act requires the Secretary of Labor to
issue this Interim Final Rule implementing provisions of the WIA under
the Department's purview within 180 days of enactment. WIA also
requires that final regulations be published by December 31, 1999.
Under Secretary of Labor's Order No. 4-75, the Assistant Secretary for
Employment and Training has been delegated the responsibility to carry
out WIA policies, programs, and activities for the Secretary of Labor.
Given the short time frame imposed, the Department has employed a
variety of means to initiate extensive coordination with other Federal
agencies that have roles and responsibilities under the Workforce
Investment Act. In addition, the Department of Labor, the Department of
Education, the Department of Health and Human Services, the Department
of Transportation, and the Department of Housing and Urban Development
continue to meet on a regular basis to resolve issues surrounding the
development of the Interim Final Rule and WIA implementation.
The Department also requested and received input from a broad range
of sources regarding guidance on how to comply with a number of WIA
statutory provisions. The Department solicited broad input on WIA
implementation through a variety of mechanisms: establishing a website
to encourage input; publishing a Federal Register notice on September
15, 1998, conducting regional and national panel discussions in October
1998; publishing a White Paper announcing goals and principles
governing implementation; posting issues on the usworkforce.org
website; sharing a discussion draft of regulatory issues with
stakeholders; holding town hall meetings across the country in December
1998; conducting several workgroups in December 1998; and issuing draft
Planning Guidance in December 1998.
A number of the suggestions received are discussed in the Summary
and Explanation of the individual provisions of the Interim Final Rule.
However, because of the large volume of suggestions received and the
short time allowed for preparation of the regulations, as well as the
fact that suggestions continue to be received, it was not possible to
address each one. Where input has not been addressed, it will be
considered along with comments on the Interim Final Rule before
publication of the Final Rule. Also, the Department will ensure that
there are other opportunities for public input and dialogue on the
important issues surrounding implementation of the Workforce Investment
Act prior to the publication of the Final Rule.
The Department has determined that this Interim Final Rule, as
promulgated, complies with the WIA statutory mandate and provides
effective direction for the implementation of WIA programs. ETA will
review all comments received in the development of and response to the
Interim Final Rule, as well as the experience of early implementing
States, in considering what further action is necessary in promulgating
a Final Rule.
II. Summary and Explanation
This section describes and explains the specific provisions of the
Interim Final Rule. The explanatory text, in general, adheres closely
to the corresponding WIA statutory and regulatory language. A
supporting rationale is provided in those instances where the Rule
promulgates specific provisions to fulfill the requirements of the WIA
statute.
The Department has set regulations only where they are necessary to
clarify or to explain how the Department intends to interpret the WIA
statute, to provide context for interpretations or to provide a clear
statement of the Act's requirements. In several instances--for example,
the Indian and Native American Programs, and Migrant and Seasonal
Farmworker Programs--the regulations were developed in consultation
with advisory councils and are more comprehensive in order to assist
those grantees. Consistent with the Act, the Interim Final Rule
provides the States and local governments with the primary
responsibility to initiate and develop program implementation
procedures and policy guidance regarding WIA administration. The
Department has not defined what constitutes many of the activities
under the Act in order to provide policy-making flexibility to States
and local areas. Section 661.120 formalizes this flexibility in the
regulations.
Description of Regulatory Provisions
The Rule adds 12 new parts to the Code of Federal Regulations, and
a new subpart to the existing Wagner-Peyser Act regulations. Parts 660-
672 are organized by subject matter; for example, 661 describes State
and local system design, 667 contains administrative requirements
applicable to WIA title I funds, and 669 describes requirements
particularly applicable to Migrant and Seasonal Farmworker programs.
This discussion section follows that organizational structure.
Part 660--Introduction to the Regulations for the Workforce
Investment Systems Under Title I of the Workforce Investment Act
Part 660 discusses the purpose of title I of the Workforce
Investment Act, explains the format of the regulations governing title
I, and provides definitions which are not found in the Act. Sections
101, 142, 166(b), 167(h) 301 and 502 of the Act contain additional
definitions. Among the regulatory definitions, the Department has
defined the term ``register'' in order to clarify that programs do not
need to register participants until they receive a core service beyond
those that are self-service or informational. This point in time also
corresponds to the point when the EEO data must be collected, when the
eligibility definition begins, and when the participants are counted
for performance measurement purposes.
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Part 661--Statewide and Local Governance of the Workforce
Investment System Under Title I of the Workforce Investment Act
Introduction
This part covers the critical underpinnings of how the workforce
investment system is organized under WIA at the State and local levels.
Specifically, it consists of four subparts--General Governance, State
Governance, Local Governance Provisions and Waiver Provisions. The
General Governance subpart broadly describes the WIA system and sets
forth the roles of the governmental partners. The State and local
subparts cover the State and local workforce investment boards and the
designation process, including alternative entities, and the planning
requirements. The waiver subpart discusses the processes for obtaining
general and work-flex waivers.
Subpart A--General Governance Provisions
1. Subpart A describes the workforce investment system, and sets
forth the roles of the government partners in the system: the Federal
government, State governments and local governments. The workforce
investment system is the method of delivery of workforce investment
activities to individuals under title I of WIA, and is composed of
State and local workforce investment boards, local workforce investment
areas, and the One-Stop system. Through the One-Stop system, the
workforce investment system is a gateway to a wide variety of
employment, training, educational and other human resource programs. In
the Department's view, close cooperation and coordination among the
Federal, State and local government partners are essential to the
system's success in providing services to those who need them. Sections
661.110 and 661.120, describe, in general terms, the roles of the
government partners. The Department sees one of its roles as Federal
partner as providing leadership, guidance and support to the system, so
that State and local governmental partners can better respond to the
needs of customers. To that end, the WIA regulations are intended to
provide a framework in which States and local partners may design
systems and deliver services in ways that best achieve the goals of WIA
based on particular need. Thus, whenever possible, items such as design
options and categories of service are not narrowly defined in the
regulations. Section 660.120 provides authority to State and local
governments to establish their own policies, interpretations,
guidelines and definitions relating to program operations under title
I, as long as they are not inconsistent with WIA or the regulations,
and, in the case of local governments, not inconsistent with State
policies. To assist with such interpretations, the Department, with the
participation of other Federal agencies, as appropriate, will issue
technical assistance guidance to help States and localities interpret
WIA and the regulations. Such guidance is not intended to limit State
flexibility, but rather is intended to provide helpful models on which
States and local governments can rely to ensure that their own
interpretations are not inconsistent with the Act and regulations.
Subpart B--State Governance Provisions
1. State Workforce Investment Board: Sections 661.200--661.210
describe the membership requirements and responsibilities of the State
Workforce Investment Board (State Board) and procedures regarding
designation of an alternative entity to perform the functions of the
State Board. The role of the State Board is to assist the Governor in
the development of the State workforce investment plan (State Plan) and
to carry out the additional functions described in WIA section 111(d).
Section 661.200 describes the membership requirements of the State
Board. This section clarifies that State Boards must contain two or
more members from each of the representative categories described in
sections 111(b)(1)(C)(iii)-(v) of WIA. These categories are labor
organizations, individuals and organizations that have experience with
youth activities, and individuals and organizations that have
experience and expertise in the delivery of workforce investment
activities. The Rule requires that, in appointing representatives with
experience in workforce investment activities, special consideration be
given to chief executive officers of community colleges and community-
based organizations in the State. The Department acknowledges the
special expertise that the community college system brings to the
workforce investment system. The Department foresees a strong role for
community colleges across states and in local areas and encourages
states and local areas to appoint presidents and executive officers of
the state community college system and local community colleges to the
State and Local Workforce Investment Boards. The Department also
emphasizes the importance of including the director of the state agency
responsible for TANF on the State Board, in order to foster linkages
between WIA and TANF, and to facilitate participation of TANF in One-
Stop systems in the state.
The Department also received suggestions concerning the
representation of the State Vocational Rehabilitation Services program,
a required One-Stop partner, on the State Board. Individuals with
disabilities represent a large untapped potential workforce, and the
workforce needs of this group is of significant importance to the
Department and other Federal agencies. To signal the importance of this
issue, the Presidential Taskforce on Employment of Adults with
Disabilities was formed in 1998. In light of this emphasis on
increasing the employment rate for individuals with disabilities as
well as the complexity of the organizational requirements applicable to
this program, the director of the designated State unit under section
101(a)(2)(B)(ii)(II) of the Rehabilitation Act, if a State has such a
unit, should be considered the lead State agency official with
responsibility for the State's vocational rehabilitation program and,
therefore, should serve on the State Board. In addition, a program
operated by a State agency for the blind or by a designated State unit
for the blind should be considered a separate program for purposes of
appointing members to the State Board under WIA section 111. Among the
contributions the unit head(s) would make as a member of the State
Board is assisting in the development of the State performance
measures. The expertise of the unit head(s) would be particularly
useful since the Department, in coordination with the Department of
Education, will be working on the development of an additional
performance indicator focusing on individuals with disabilities that
may be used by States under title I of WIA. The Department of Labor and
the Department of Education will work with the States as they develop
and implement their State plans to ensure the effective delivery of
services under the WIA to individuals with disabilities. The Department
will also be conducting a study of WIA implementation that will include
a review of the manner and extent to which Vocational Rehabilitation
programs are integrated in the workforce investment system, and how
effectively the system serves individuals with disabilities.
As discussed below, regarding local workforce investment board
(Local Board) membership requirements, the
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Department received substantial input expressing concern that the
statutory membership requirements relating to the State and local
boards will lead to large, unmanageable State and Local Boards. In
contrast, others thought larger boards would be better in representing
a wider array of interests. The Department recognizes this concern,
and, although constrained by the statutory requirements that each
category of membership contain more than one representative and a
business majority, the Department has avoided adding additional
requirements relating to the number of members required. The Department
believes that problems associated with large board size can be
addressed in a number of ways, such as the use of committees. The
Department will be providing technical assistance on creative
approaches State and Local Boards may wish to consider in addressing
this issue.
2. Alternative Entities: The Department believes that changing from
existing JTPA boards and councils to State Boards meeting the
requirements of WIA section 111(b) is essential to the reforms of WIA.
The Department encourages all States to create new, fully functional
State Boards as early as possible, and is committed to providing
assistance to States to make such changes. In order to accommodate
States that have already begun to reform their boards prior to the
enactment of WIA, the statute provides an option to use an existing
entity to carry out the functions of the State Board. Section 661.210
describes the requirements relating to the appointment of this
alternative entity. Because of questions regarding the application of
these requirements, paragraph (b) of Sec. 661.210 makes clear that an
alternative entity must meet each of the three criteria set forth in
WIA section 111(e). The three criteria are that the entity: (1) Was in
existence on December 31, 1997; (2)(a) was established pursuant to
section 122 or title VII of the Job Training Partnership Act, as in
effect on December 31, 1997, or (b) is substantially similar to the
State Board as described in subsections (a), (b), and (c) of WIA
section 111; and (3) includes representatives of business in the state
and representatives of labor organizations in the state. An entity
which fails to meet any one of the criteria is not eligible to perform
the functions of the State Board. A key requirement for an alternative
entity that was not created under JTPA, is that it be substantially
similar to the Boards required under WIA. The Department considered
various ways to define the term ``substantially similar'' but, in the
end, decided to leave the term undefined. All groups required for
membership on Workforce Investment Boards are equally important and the
Department sees alternative entities as a transitional phase during
which states can operate until a new Board is appointed.
While an alternative entity need not contain the identical
membership structure required of State Boards, in the Department's view
it is important that each of the groups listed in WIA section 111(b)
have a role in the workforce investment system if the system is to be
successful. Therefore, the Rule requires that if the Governor
identifies an alternative entity, the State Plan must explain how the
State will ensure the ongoing participation of any omitted membership
groups in the functions of State workforce investment system. While
this Rule does not mean that omitted groups must be seated on an
alternative entity, it does require that the State Plan describe how
these groups will have an opportunity for meaningful input into
decisions made by the State Board.
Paragraph (d) of Sec. 661.210 amplifies the requirement that an
alternative entity must have been established by and in existence on
December 31, 1997. Because of this requirement, modifications to the
alternative entity are not allowed; a change to the membership
structure after December 31, 1997 will invalidate the entity's
eligibility as an alternative entity. The membership structure is not
considered to be changed when an existing member leaves the board and a
replacement member is appointed. However, the membership structure is
considered to be changed when a change is made to the organizational
structure of the State Board that requires a change (whether the change
is formally made or not) in the State Board's charter or to a similar
document that defines the organizational structure of the State Board,
such as appointing members of a category not previously represented. In
such a case, the entity would no longer be eligible to perform the
functions of the State Board and a new entity, meeting all the
requirements of section 111 of WIA must be created. This prevents
piecemeal modification of alternative entities that would add certain
section 111(b) membership categories but not others.
3. State Workforce Investment Plan Requirements: Sections 661.220
and 661.230, describe the requirements for submission, approval and
modification of the State workforce investment plan. The State Plan
must be submitted in accordance with planning guidelines to be issued
by the Secretary, and must be developed through an open public comment
process. The State Plan must document the timeline and the steps taken
to ensure the opportunity for meaningful public comment. The Department
intends that the information contained in the State Plan be subject to
the broadest possible stakeholder involvement in policy development and
the broadest possible range of public comment. The planning guidelines
set forth the information needed for the Secretary to make an informed
judgment as to whether a State Plan is consistent with WIA. The Rule
restates the statutory language regarding the process for State Plan
approval. All plans must be approved within 90 days unless the
Secretary determines in writing that the State Plan is inconsistent
with the provisions of title I of WIA and its implementing regulations
or it does not satisfy the State Plan approval requirements of the
Wagner-Peyser Act and its implementing regulations. This reflects
changes made by the technical corrections added in the Omnibus
Appropriations Act for FY 1999, which clarified that the State plan
will not be approved if it fails to meet the requirements of either WIA
or the Wagner-Peyser Act rather than only when it fails to meet both.
Failure to have completed negotiations with the Secretary of Labor on
performance measures means the plan is not consistent with title I of
WIA. A state's failure to have an effective strategy in place to ensure
the development of a fully operational One-Stop delivery system in the
state also means the state plan is not consistent with WIA title I. An
important part of this strategy is an impasse procedure designed to
facilitate collaboration and coordination between One-Stop partners at
the local level.
4. State Plan Modifications: Section 661.230 provides the approval
process for State Plan modifications. It clarifies that modifications
may be made at any time during the life of the State Plan, and must be
made upon certain conditions. Because the State Plan is a five year
strategic plan and designed to be a living document, it is likely that
assumptions based upon such things as State or Federal policy, economic
conditions, performance goals, State and local organizational
structures and/or State and local needs may change during the course of
the State Plan. The provision for a five year State Plan was intended
to reduce paperwork burdens on the States. Accordingly, only
significant changes require a modification. Examples are: changes in
performance indicators, changes in the
[[Page 18667]]
methodology used to determine local allocation of funds, or changes to
the membership structure of the State Board or alternative entity.
Modifications triggered by significant changes will be subject to the
same review process as the original State Plan. While it is impossible
to foresee all such changes that may occur during a five year period,
through timely modifications of the State Plan, State strategies can
continue to guide Local Board policy development. The Secretary must
approve all State Plan modifications unless the disapproval criteria in
Sec. 661.220 are met.
5. Local Workforce Investment Area Designation Requirements:
Sections 661.250 through 661.280 discuss the requirements applicable to
the designation of local workforce investment areas. The Rule tracks
the statutory language regarding the State Board recommendation and
Governor's approval process for designation. It refers to the statutory
provisions regarding automatic designation of areas with a population
of 500,000 or more (that request designation) at section 116(a)(2) of
WIA and temporary and subsequent designation of JTPA service delivery
areas meeting certain performance criteria (that request designation)
at section 116(a)(3) of WIA. The statute prohibits the Department from
further regulating on the standards and criteria for temporary and
subsequent designation and requires the Department to provide the
States with technical assistance to make the designations. The
regulations restate the statutory language regarding the rights of
areas to appeal the denial of a request for automatic or temporary and
subsequent designation as a local workforce investment area.
6. Regional Planning Activities: Section 661.290 describes the
circumstances in which the State may require Local Boards to take part
in regional planning activities. This provision permits States to
undertake methods to improve performance across area boundaries by
requiring local areas to engage in a regional planning process to share
employment-related information and to coordinate the provision of local
services pursuant to that regional planning. The regulation follows the
statutory language regarding the requirements for regional planning,
and permits regional planning to occur across State boundaries. Section
661.290 clarifies that Local Boards which are part of State-designated
regional planning areas must participate in regional planning
activities. However, to strike a balance, the regulation also provides
that regional planning and performance requirements may not substitute
for the local planning and performance requirements unless the affected
chief elected officials and the Governor agree to that substitution.
Subpart C--Local Governance Provisions
This Subpart covers the designation of local workforce investment
areas and the responsibilities and membership requirements of local
boards.
1. Role of the Local Workforce Investment Board: Under WIA, the
Local Board, in partnership with the chief elected official, is
responsible for setting policy and overseeing workforce investment
programs for a workforce investment area. Sections 661.300 and 661.305
reiterate the roles and responsibilities of Local Boards. There was
some concern expressed that the Local Board activities be carried out
in an open manner which encourages public comment and participation.
The Department responds to these concerns by restating the WIA section
117(e) ``sunshine provision'' in Sec. 661.305(d).
2. Local Boards as Service Providers: Section 117(f)(1) of WIA
places limitations on Local Boards' direct provision of core services,
intensive services, or training services. In response to requests for
clarification, Sec. 661.310(c) specifies that the prohibition related
to providing core, intensive and training services by the Local Board
also applies to the staff of the Local Board. This regulation also
cites the statutory provision allowing a Local Board to be designated
or certified as a One-Stop operator only with the agreement of the
chief elected official and the Governor.
3. Membership Requirements: Section 661.315 of the regulations
addresses the membership requirements for the Local Board that are
contained in section 117(b) of WIA. There were suggestions on several
issues related to the required membership of the Local Board,
particularly as to how the terms ``representatives'' and ``including''
would be defined.
Representatives: Some parties expressed the view that the term
``representatives,'' as used in section 117(b)(2)(A) (ii)-(v) of WIA,
requires that there be multiple representatives from each of the
specified entities. While others wanted a more restrictive definition,
the regulations specify that the Local Board must contain two or more
members representing the categories described in section 117(b)(2)(A)
(ii)-(v) of WIA. These categories cover different types of local
educational entities, labor organizations, community-based
organizations (including those representing individuals with
disabilities and veterans), and economic development agencies.
Including: There also were many questions on the meaning of the
term ``including'' as it is used in WIA section 117(b). Some expressed
the view that each of the entities following the word ``including'' in
section 117(b)(2)(A)(ii), (iv), and (v) of WIA must be a required
member of the Local Board, while others disagreed with this
interpretation. The regulations address this issue by requiring that
special consideration be given to including representatives of
community colleges in the selection of members representing local
educational entities; to including representatives of organizations
representing individuals with disabilities and veterans, in selection
of members representing community-based organizations; and
representatives of private sector economic development entities in
selecting representatives of economic development agencies. The
regulations do not mandate a membership seat for each such entity.
Board Size: The Department heard many concerns that the statutory
membership requirements relating to Local Boards will lead to large,
unwieldy, and unmanageable Local Boards. The Department recognizes this
concern, and while the Department is constrained by the statutory
requirements that each category of membership contain more than one
representative and that the board contain a business majority, the
Department has not added additional regulatory requirements on the
number of members required. The Department believes that problems
associated with large board size can be addressed in a number of ways,
such as through the use of committees. The Department will provide
technical assistance on creative approaches State and Local Boards may
wish to consider in addressing this issue.
4. Alternative Entity: The Department believes that changing from
existing JTPA Private Industry Councils to local workforce investment
boards is essential to the reforms of WIA. The Department strongly
encourages all eligible areas to create new, fully functional Local
Boards as early as possible, and is committed to providing assistance
to facilitate such changes. However, the Department recognizes that the
statute provides an option to use an existing entity to carry out the
functions of the Local Board. Section 661.330 describes the
requirements relating to the appointment of such an alternative entity.
Because of questions regarding
[[Page 18668]]
the application of these requirements, paragraph (a) of Sec. 661.330
makes clear that an alternative entity must meet each of the four
criteria set forth in WIA section 117(i), including the requirement
that the alternative entity must have been established by December 31,
1997. An entity which fails to meet any one of these criteria is not
eligible to perform the functions of the Local Board.
While an alternative entity need not contain the identical
membership structure as that required of Local Boards, section
117(i)(1)(c)(ii) does require the alternative entity to be
substantially similar to the Local Boards. In the Department's view it
is extremely important that each of the groups listed in section
117(b)(2) have an active role in the workforce investment system if the
system is to be successful. Therefore, the Rule requires that the
alternative entity be identified in the State Plan and the local
workforce investment plan, and that these workforce investment plans
explain the manner in which the Local Board will ensure the ongoing
participation of any omitted membership groups in the local workforce
investment area. While this Rule does not require that such groups be
seated on the Board, it does require the State and local workforce
investment plans to describe the means by which such groups will have
periodic regular meaningful opportunities for input into decisions made
by the Local Board.
Paragraph (c) of Sec. 661.330 amplifies the requirement that an
alternative entity must have been established by and in existence on
December 31, 1997. Because of this requirement, modifications of the
alternative entity are not allowed; any change to the membership
structure will invalidate the entity's eligibility as an alternative
entity. The membership structure is not considered to be changed when
an existing member leaves the Local Board and a replacement member is
appointed. However, it is considered to be changed when a change is
made to the organizational structure of the Local Board that requires a
change (whether the change is formally made or not) in the Local
Board's charter or to a similar document that defines the
organizational structure of the Local Board, such as appointing members
of a category not previously represented. In that case, the entity is
no longer eligible to perform the functions of the Local Board and a
new entity, meeting all the requirements of section 117 of WIA must be
created. This prevents piecemeal modification of alternative entities
that would add certain WIA section 117(b)(2) membership categories, but
not others.
5. Youth Council: Section 117(h) of WIA establishes youth councils
as a subgroup of the Local Boards. Youth councils are an innovative new
entity intended to broaden participation in the design and delivery of
youth services at the local level. Section 661.335 describes the
relationship of the youth council to the Local Board as well as the
membership requirements and Sec. 661.340 explains the responsibilities
of the youth council, as described in section 117(h) of WIA.
6. Local Workforce Investment Plan: Sections 661.345 and 661.350
describe the requirements for the submission of the local workforce
investment plan (Local Plan) and the contents of the Local Plan.
Section 661.350 enumerates the Local Plan components outlined in WIA
section 118(b). The Local Plan also must include information on the
process for directing the One-Stop operators to give priority to low-
income individuals and recipients of public assistance in the event
that adult funds are limited, as required by WIA section 134(d)(4)(E).
This priority is discussed in more detail under Sec. 663.600.
Section 118 of WIA indicates that Local Plans cover a five year
period. Some parties suggested that modifications to the local plan
will likely be needed within the five year span. The Department
concurs, and the regulations permit the Governor to require local plan
modifications and, at Sec. 661.355, offer a few examples of when such
modifications might be required by the Governor. Section 661.355 states
that the Governor must establish procedures for Local Plan
modifications.
Subpart D--Waivers and Workflex
Subpart D indicates the elements of WIA and the Wagner-Peyser Act
that may and may not be waived under either the General Waiver
Authority or the Work Flex provision. The purpose of the general
statutory and regulatory waiver authority provided by section 189(i)(4)
and workforce flexibility waiver authority provided at section 192 is
to give flexibility to States and local areas in the design and
implementation of consolidated workforce development programs under
WIA. The regulations specify that the Secretary does not intend to
waive any of the key elements of the reform principles embodied in the
Act (listed in the background section of this preamble and in
Sec. 661.400), except in extremely unusual circumstances. It also
specifies that the provisions that incorporate the reform principles
embodied in the Act may not be waived under the Work Flex authority.
Part 662--Description of the One-Stop System Under Title I of the
Workforce Investment Act
Introduction
The establishment of a One-Stop delivery system for workforce
development services is a cornerstone of the reforms contained in title
I of WIA. This delivery system streamlines access to numerous workforce
investment and educational and other human resource services,
activities and programs. The Act's requirements build on reform efforts
that are already underway in all States through the Department's One-
Stop grant initiative. Rather than requiring individuals and employers
to seek workforce development information and services at several
different locations, which is often costly, discouraging and confusing,
WIA requires States and communities to integrate multiple workforce
development programs and resources for individuals at the ``street
level'' through a user friendly One-Stop delivery system. This system
will simplify and expand access to services for job seekers and
employers.
The Act specifies nineteen required One-Stop partners and an
additional five optional partners to streamline access to a range of
employment and training services. WIA requires coordination among all
Department of Labor funded programs as well as other workforce
investment programs administered by the Departments of Education,
Health and Human Services, and Housing and Urban Development. WIA also
encourages participation in the One-Stop delivery system by other
relevant programs, such as those administered by the Departments of
Agriculture, Health and Human Services, and Transportation, as well as
the Corporation for National and Community Service. In addition, local
areas are authorized to add additional partners as local needs may
require. All of these Federal Agencies will continue to work together
to ensure effective communication and collaboration at the Federal
level in support of One-Stop service delivery.
Subpart A--One-Stop Delivery System
1. Structure: Subpart A describes the structure of a One-Stop
delivery system. The regulation, at Sec. 662.100, describes the One-
Stop system as a seamless system of service delivery that is created
through the collaboration of entities responsible for separate
workforce development funding streams. The One-Stop system is designed
to enhance access to services and improve outcomes for individuals
seeking
[[Page 18669]]
assistance. The regulation specifically defines the system as
consisting of one or more comprehensive, physical One-Stop centers in a
local area that provides the core services specified in WIA section
134(d)(2) and that provide access to the other activities and programs
provided under WIA and by each One-Stop partner. In locating each
comprehensive center, Local Boards should coordinate with the broader
community, including transportation agencies, to ensure that the
centers are accessible to their customers. In addition to the
comprehensive centers, the regulation notes that WIA allows for three
other arrangements to supplement the comprehensive center. These
supplemental arrangements include: (1) A network of affiliated sites
that provide one or more of the programs, services and activities of
the partners; (2) a network of One-Stop partners through which the
partners provide services linked to an affiliated site and through
which all individuals are provided information on the availability of
core services in the local area; and (3) specialized centers that
address specific needs. In essence, this structure may be described as
a ``one right door and no wrong door'' approach. One-Stop partners have
an obligation to ensure that core services that are appropriate for
their particular populations are made available at one comprehensive
center. If an individual enters the system through one of the network
sites rather than the comprehensive One-Stop center, the individual may
still obtain certain services at the network site and information about
how and where all the other services provided through the One-Stop
system may be obtained.
Subpart B--One Stop Partners
1. Responsibilities: Subpart B identifies the One-Stop partners and
their responsibilities in the One-Stop delivery system. The required
partners are entities that carry out the workforce development
programs. They are specifically identified in section 121(b)(1) of WIA
and Sec. 662.200. The regulation at Sec. 662.200(a)(1)(i through vii)
separately specifies the funding streams under title I that are
included as required partners. The regulations also identify the other
required programs, with some clarification of the particular sections
of certain Acts (for example, the Vocational Rehabilitation Act and the
Carl D. Perkins Act) that authorize the program that must participate.
Section 662.210 identifies additional partners that may be a part of
the One-Stop system at local option.
Entities--The regulation at Sec. 662.220 provides a general
definition of the ``entity'' that carries out the specified programs
and serves as the partner. In light of the responsibilities of the
partners, which are described below and include decisions regarding the
use and administration of program resources, the regulation defines the
entity as the grant recipient or other entity or organization
responsible for administering the program's funds in the local area.
The term ``entity'' does not include service providers that contract
with or are subrecipients of the local entity. The regulation notes
that for programs that do not have local administrative entities, the
responsible State agency may be the One-Stop partner. In addition, the
regulation specifies the appropriate entity to serve as partner for the
Adult Education and Vocational Rehabilitation programs. Entities that
serve as the partner under the Indian and Native American, Migrant and
Seasonal Farmworker, Job Corps, and Youth programs are identified in
the sections of the regulations applicable to those programs.
Partner Responsibilities--This subpart also describes and
elaborates on the statutory responsibilities of the partners. The
regulation at Sec. 662.230 identifies the five provisions of the Act
that describe these responsibilities. One of the key responsibilities
of each partner is to make available at the comprehensive center
through the One-Stop system appropriate core services that are
applicable to the partner's program. The regulation at Sec. 662.240
lists the core services that are described in section 134(d)(2) of WIA,
and defines ``applicable'' to mean the services from that list that are
authorized and provided under the partner programs. The extent to which
core services are applicable to a partner program, as well as the
manner in which services are provided, are determined by the program's
authorizing statute.
Availability of Services--The regulation at Sec. 662.250 describes
where and to what extent the One-Stop partners must make available the
applicable core services. Since section 134(c) of WIA requires that
core services be provided, at a minimum, at one comprehensive physical
center, the regulation requires that the applicable core services
attributable to the partner's program be made available by each partner
at that comprehensive center. To avoid duplication of services
traditionally provided under the Wagner-Peyser Act, this requirement is
limited to those applicable core services that are in addition to the
basic labor exchange services traditionally provided in the local area
under the Wagner-Peyser program. While a partner would not, for
example, be required to duplicate an assessment provided under the
Wagner-Peyser Act, the partner would be expected to be responsible for
any needed assessment that includes additional elements specifically
tailored to participants under the partner's program. However, the
adult and dislocated worker program partners are required to make all
of the core services available at the center.
Flexibility--The regulations also provide significant flexibility
regarding how the core services are to be made available at the One-
Stop center by allowing for services to be provided through appropriate
technology at the center, through co-location of personnel, cross-
training of staff, or through contractual or other arrangements between
the partner and the service providers at the center.
2. Proportional Responsibility: The regulation also provides that
the responsibility for the provision of and financing for applicable
core services is to be proportionate to the use of services at the
center by individuals attributable to the partners' programs. The
regulation further provides that the individuals attributable to a
partners' program may include individuals referred through the center
and enrolled in the partner's program after the receipt of core
services, individuals enrolled prior to the receipt of core services,
individuals who meet the eligibility criteria for the partner's program
and who receive an applicable core service, or individuals who meet an
alternative definition described in the Memorandum of Understanding
(MOU), described in subpart C. This ``proportionate responsibility''
provision is intended to provide an equitable principle for sharing
responsibility among the partners. The regulation provides that the
specific method for determining proportionate responsibility (for
example, surveys) must be described in the MOU.
Additional Sites--The regulation provides that core services may be
provided at sites in addition to the comprehensive center under the
MOU. Therefore, it is not required that partners provide applicable
core services exclusively at a One-Stop center. If an individual seeks
core services at the One-Stop center rather than at the partner's site,
they should be made available to him or her without referral to another
location, but a partner is not required to route all of its
participants through the comprehensive One-Stop center.
Access to Services--The regulation at Sec. 662.260 provides that,
in addition to the provision of core services, the One-
[[Page 18670]]
Stop partners must use the One-Stop system to provide access to the
partners' other activities and programs. This access must be described
in the MOU. This requirement is essential to ensuring a seamless,
comprehensive workforce development system that identifies the service
options available to individuals and takes the critical next step of
facilitating access to these services.
3. Cost Sharing: The regulation at Sec. 662.270 provides that the
particular arrangements for funding the services provided through the
One-Stop system and the operating costs of the One-Stop system must be
described in the MOU. Each partner must contribute a fair share of the
operating costs based on the use of the One-Stop delivery system by
individuals attributable to the partner's program. This is an equitable
principle and there are a number of methods that may be used for
allocating costs among partners that are consistent with this principle
and the OMB circulars. To promote efficiency and optimal performance,
partner contributions for the administrative costs of the system may be
re-evaluated annually through the memorandum of understanding process.
The regulation identifies a number of methodologies, including cost
pooling, indirect cost allocation, and activity based cost allocation
plans, that may be used. The Department, in consultation with other
affected Federal agencies, intends to issue guidance or technical
assistance relating to cost allocation methods to assist in this area.
Allocation Process--The regulation at Sec. 662.280 clarifies that
the requirements of each partner's authorizing legislation continue to
apply under the One-Stop system. Therefore, while the overall effect of
linking One-Stop partners in the One-Stop system is to create universal
access to core services, the resources of each partner may only be used
to provide services that are authorized and provided under the
partner's program to individuals who are eligible under the program.
As noted above, consistent with this principle, there are a variety
of methods for allocating costs among programs. In sum, this regulation
is intended to clarify that participation in the One-Stop delivery
system is a requirement that is in addition to, rather than in lieu of,
the other requirements applicable to the partner program under each
authorizing law.
Subpart C--Memorandum of Understanding
Subpart C describes the operation of the local One-Stop system.
Section 662.300 addresses the Memorandum of Understanding (MOU) that
must be executed between the Local Board and the One-Stop partners.
Section 662.310 states that the local areas may develop a single
umbrella MOU covering all partners and the Local Board, or separate
MOU's between partners and the Local Board. In many areas, the umbrella
approach may be the preferred means to facilitate a comprehensive and
equitable resolution of the operational issues relating to the One-
Stop. The regulation also emphasizes that it is a legal obligation for
the partners and the Local Board to engage in good faith negotiation
and reach agreement on the MOU. The partners and the Local Boards may
seek the assistance of the appropriate State agencies, the Governor,
State Board or the appropriate parties in reaching agreement. The State
agencies, the State Board, and the Governor may also consult with the
appropriate Federal agencies to address impasse situations after
exhausting other alternatives. If an impasse has not been resolved,
parties that fail to execute an MOU may not be permitted to serve on
the Local Board. In addition, if a Local Board has not executed an MOU
with all required parties, the local area is not eligible for State
incentive grants awarded for local coordination.
Subpart D--One-Stop Operator
This subpart addresses the role and selection of One-Stop
operators. The operators are responsible for administering the One-Stop
centers and their role may range from simply coordinating service
providers in the center to being the primary provider of services at
the center. The role is determined by the Local Board. In areas where
there is more than one comprehensive One-Stop center, there may be
separate operators for each center or one operator for multiple
centers. The operator may be selected by the Local Board through a
competitive process, or the Local Board may designate a consortium that
includes three or more required One-Stop partners as an operator. The
Local Board itself may serve as a One-Stop operator only with the
consent of the chief elected official and the Governor. This subpart
also addresses the ``grandfathering'' of existing One-Stop operators.
The regulations provide some continuity for areas that have already
established One-Stop systems while ensuring that fundamental features
of the new One-Stop system are incorporated. A local area does not have
to comply with the One-Stop operator selection procedures if the One-
Stop delivery system, of which the operator is a part, existed before
August 7, 1998 (the date of the WIA's enactment); if the One-Stop
system includes all of the required One-Stop partners; and if an MOU is
executed consistent with the requirements of the Act.
Part 663--Adult and Dislocated Worker Activities Under Title I of
the Workforce Investment Act
Introduction
This part of the regulations describes requirements relating to the
services that are available for adults and dislocated workers. Along
with Wagner-Peyser labor exchange services, the required adult and
dislocated worker services, described as core, intensive, and training
services, form the backbone of the One-Stop delivery system. The WIA
goal of universal access to core services is achieved through close
integration of services provided by the Wagner-Peyser, WIA adult and
dislocated worker partners and other partners in the One-Stop center
and system. Intensive and training services are available to
individuals who meet the eligibility requirements for the funding
streams and who are determined to need these services to achieve
employment, or in the case of employed individuals, to obtain or retain
self-sufficient employment. Supportive services, to enable individuals
to participate in these other activities, including needs-related
payments for individuals in training, may also be provided.
These regulations also introduce the Individual Training Account
(ITA), which is a key reform element of the Workforce Investment Act.
Individuals are expected to take a proactive role in choosing the
training services which meet their needs. They will be provided with
quality information on providers of training and, armed with effective
case management and an ITA as the payment mechanism, they will have the
opportunity to choose the training provider that best meets their
needs.
Subpart A--One-Stop System
1. Role of the Adult and Dislocated Worker Program in the One-Stop
System: The regulation at Sec. 663.100 provides that the One-Stop
system is the basic delivery system for services to adults and
dislocated workers. The concept of a single system that provides
universal access to certain services to all individuals age 18 or older
is a key tenet of the Workforce Investment Act. The regulation reflects
the emphasis in WIA to consolidate and coordinate services. The grant
recipient(s) for the adult and dislocated worker program is a required
partner and is subject to Sec. 662.210
[[Page 18671]]
regarding required partner responsibilities. Access to services through
the One-Stop system ensures that individual needs are identified and,
to the extent possible, met. The consolidation of and access to
services will result in improved services for both adults and
dislocated workers.
2. Registration and Eligibility: Sections 663.105 through 663.120
address registration and basic eligibility requirements. In response to
concerns regarding the timing of eligibility determination for services
in a One-Stop system, the Department has provided general guidance in
the regulation at Sec. 663.105 on when adults and dislocated workers
must be registered. Sections 663.110 and 663.120 contain the basic
eligibility criteria for adults and dislocated workers, respectively.
Individuals who are primarily seeking information and do not seek
direct, one-on-one staff assistance, do not need to be registered.
However, when an individual seeks more than minimal assistance from
staff in taking the next steps toward self-sufficient employment, then
eligibility must be determined. Registration is the point at which
information that is used in performance measurement begins to be
collected. In addition, equal employment opportunity data must be
collected on individuals when any assessment or discretionary decision
regarding a specific individual is made. Such assessments or decisions
include: Decisions regarding service or program eligibility, either
positive or negative; and decisions made on the part of any workforce
investment system employee which lead to a targeting of services for
the individual. The Department will issue further guidance regarding
this data collection. Additional information needed to determine
eligibility for other assistance available at the One-Stop site may
also be determined at the same time. Program operators should determine
the information that they need for cost allocation purposes and when
they can most efficiently collect it. Electronic records systems allow
information to be collected incrementally as higher levels of
assistance are provided.
3. Displaced Homemaker Eligibility: In response to inquiries
regarding assistance to displaced homemakers, the regulation at
Sec. 663.120 clarifies that a displaced homemaker who has been
dependent on the income of another family member but is no longer
supported by that income, is unemployed or underemployed and is
experiencing difficulty in obtaining or upgrading employment, may
receive assistance with funds available to Local Boards for services to
dislocated workers.
4. Title I Funds: Section 663.145 clarifies how title I adult and
dislocated worker funds are used to contribute to the provision of core
services, and to provide intensive and training services through the
One-Stop delivery system. All three types of services must be provided,
but the Local Boards determine the mix of the three services.
5. Sequence of Services: WIA provides for three levels of services:
Core, intensive, and training, with service at one level being a
prerequisite to moving to the next level. There was a great deal of
concern expressed about how this tiered approach would be implemented.
Many were particularly concerned that the Department might require a
``failed'' job search or a minimum time period in one level of service
before moving on to the next level. The regulations establish the
concept of a tiered approach but allow significant flexibility at the
local level. The Department, in response to the comments received, did
not establish a minimum number of ``failed'' job applications or a
minimum time period but, instead, allows localities to establish
gateway activities that lead from participation in core to intensive
and training services. Any core service, such as an initial assessment
or job search and placement assistance, could be the gateway activity.
In intensive services, the gateway activity could be the development of
an individual employment plan, individual counseling and career
planning or another intensive service. Key to these gateway activities
is the determination, made at the local level, that intensive or
training services are required for the participant to achieve the goal
of obtaining or retaining self-sufficient employment. The three levels
of services are discussed separately in the regulations.
6. Core Services: The regulations at Secs. 663.150 to 663.165
discuss the core services. All of the core services that are listed in
the Act must be made available in each local area through the One-Stop
system. Followup services must be available for a minimum of 12 months
after employment begins, to registered participants who are placed in
unsubsidized employment. Among the core services available is
information on targeted assistance available through the One-Stop
system for specific groups of workers, such as Migrant and Seasonal
Farm Workers, and veterans.
Core services also include assistance in establishing eligibility
for the Welfare-to-Work program and programs of financial aid for
training and education programs. The specific form of this assistance
is determined at the local level based on the participant's needs and
in coordination with the other partner programs. This assistance may
include: referrals to specific agencies; information relating to, or
provision of, required applications or other forms; or specific on-site
assistance.
Another core service is the provision of information relating to
the availability of supportive services, including child care and
transportation, available in the local area, and referral to such
services as appropriate. The Department encourages Local Boards to
establish strong linkages with a variety of supportive service
programs, including Food Stamps, Medicaid programs, and CHIP. Such
programs provide key supports for low-income working families and
families making the transition from welfare to self-sufficiency.
The Department also encourages Local Boards to establish strong
linkages to child support agencies and organizations serving fathers.
WIA services can help raise the employment and earnings of non-
custodial fathers and fathers living with their children so that they
can better support their children. Child support payments help low
income single parents stabilize and raise their income. At the same
time, it is important for One-Stop programs to be aware of the child
support requirements on non-custodial parents who may receive services.
Subpart B--Intensive Services
1. Intensive Services for Adults and Dislocated Workers: The
regulation at Sec. 663.200 discusses intensive services. The regulation
provides that intensive services beyond those listed in the Act may
also be provided. Out-of-area job search expenses, relocation expenses,
internships, and work experience are specifically mentioned to clarify
that they are among the additional intensive services that may be
provided. Intensive services are intended to identify obstacles to
employment through a comprehensive assessment or individual employment
plan in order to determine specific services needed, such as counseling
and career planning, referrals to community services, and, if
appropriate, referrals to training.
2. Participation in Intensive Services: Section 663.220 explains
that intensive services are provided to unemployed adults and
dislocated workers who are unable to obtain employment through core
services and require these services to obtain or retain employment, and
employed workers who need services to obtain or retain employment that
leads
[[Page 18672]]
to self-sufficiency. The regulations at Secs. 663.240 through 663.250
specify that an individual must receive at least one intensive service,
such as the development of an individual employment plan with a case
manager or individual counseling and career planning, before the
individual may receive training services and that there is no Federally
required minimum time for participation in intensive services. Each
person in intensive services should have a case management file, either
hard copy, electronic or both. Section 663.240 explains that the case
file must contain a determination of need for training services, as
identified through the intensive service received.
3. Self-sufficiency: This regulation, at Sec. 663.230, discusses
how ``self-sufficiency'' should be determined. WIA requires a
determination that employed adults and dislocated workers need
intensive or training services to obtain or retain employment that
allows for self-sufficiency as a condition for providing those
services. Recognizing that there are different local conditions that
should be considered in this determination, the regulation provides
maximum flexibility, requiring only that self-sufficiency mean
employment that pays at least the lower living standard income level.
State Boards or Local Boards must set the criteria for determining
whether employment leads to self-sufficiency. Such factors as family
size and local economic conditions may be included in the criteria. It
may often occur that dislocated workers require a wage higher than the
lower living standard income level to maintain self-sufficiency.
Therefore, the Rule allows self-sufficiency for a dislocated worker to
be defined in relation to a percentage of the lay-off wage.
Subpart C--Training Services
1. Training Services: Training services are discussed at
Secs. 663.300 and 663.320. Training services are designed to equip
individuals to enter the workforce and retain employment. Under JTPA, a
dislocated worker participating in training under title III of JTPA is
deemed to be in training with the approval of the State Unemployment
Compensation Agency. With such approval, unemployment compensation
cannot be denied to the individual solely on the basis that the
individual is not available for work because he or she is in training.
Although there is no comparable provision in WIA, this JTPA provision
will remain in effect during the transition period under the
Secretary's authority to guide that transition from JTPA to WIA. The
Department will seek an amendment adding similar language to WIA which
would deem all adults participating in training under title I of WIA to
be in approved training for the purposes of unemployment compensation
qualification.
2. Determining the Need for Training: The regulations at
Sec. 663.310 provide that the One-Stop operator or partner determines
the need for training based on an individual (1) meeting the
eligibility requirements for intensive services; (2) being unable to
obtain or retain employment through such services; and (3) being
determined after an interview, evaluation or assessment to be in need
of training. Section 663.310 requires that, to receive training, an
individual must select a program of services directly linked to
occupations in demand in the area, based on information provided by the
One-Stop operator or partner. If individuals are willing to relocate,
they may receive training in occupations in demand in another area.
3. Requirements When Other Grant Assistance is Available to
Participants. Section 663.320 implements the requirements of WIA
section 134(d)(4)(B), which limits the use of WIA funds for training
services to instances when there is no or inadequate grant assistance
from other sources available to pay for those costs. The statute
specifically requires that funds not be used to pay for the costs of
training when Pell Grant funds or grant assistance from other sources
are available to pay the costs. This section is intended to give effect
to this WIA requirement and still give effect to title IV of the Higher
Education Act (HEA) as amended (20 U.S.C. 1087uu), which prohibits
taking into account either a Pell Grant or other Federal student
financial assistance when determining an individual's eligibility for,
or the amount of, any other Federal funding assistance program.
Section 134(d)(4)(B) of WIA requires the coordination of training
costs with funds available under other Federal programs. To avoid
duplicate payment of costs when an individual is eligible for both WIA
and other assistance, including a Pell Grant, Sec. 663.320(b) requires
that program operators and training providers coordinate by entering
into arrangements with the entities administering the alternate sources
of funds, including eligible providers administering Pell Grants. These
entities should consider all available sources of funds, excluding
loans, in determining an individual's overall need for WIA funds. The
exact mix of funds should be determined based on the availability of
funding for either training costs or supportive services, with the goal
of ensuring that the costs of the training program the participant
selects are fully paid and that necessary supportive services are
available so that the training can be completed successfully. This
determination should focus on the needs of the participant; simply
reducing the amount of WIA funds by the amount of Pell Grant funds is
not permitted. Participation in a training program funded under WIA may
not be conditioned on applying for or using a loan to help finance
training costs.
With such coordination and arrangements, the WIA counselor is
likely to know the amount of WIA funds available to the WIA participant
when calculating the amount of financial assistance needed for the
participant to complete the training program successfully. The WIA
counselor needs to work with the WIA participant to calculate the total
funding resources available as well as to assess the full ``education
and education related costs'' (training and supportive services costs)
incurred if the participant is to complete the chosen program. This
also ensures both that duplicate payments of training costs are not
made and that the amount of WIA funded training is not reduced by the
amount of Federal student financial assistance in violation of 20
U.S.C. 1087uu.
It is important to note that the Pell Grant is not school-based;
rather, it is a portable grant for which preliminary eligibility can,
and should, be determined before the participant enrolls in a
particular school or training program. The application for determining
eligibility and ultimately the amount of the grant, should be readily
available at all One-Stop centers for assistance in the completion of
these ``gateway'' financial aid applications.
Section 663.320(c) implements the requirements of WIA section
134(d)(4)(B)(ii). This section permits a WIA participant to enroll in a
training program with WIA funds while an application for Pell Grant
funds is pending, but requires that the local workforce investment area
be reimbursed for the amount of the Pell Grant used for training if the
application is approved. Since Pell Grants are intended to provide for
both tuition and other education-related costs, the Rule also clarifies
that only the portion provided for tuition is subject to reimbursement.
In the limited cases where contracts are used rather than ITA's,
the contracts negotiated by the One-Stop center must prohibit training
institutions or
[[Page 18673]]
organizations from holding the student liable for outstanding charges.
Otherwise, the performance agreements would be undercut because the
incentive for the institution or organization to perform would be
removed. Also, the practice of withholding Pell Grants from students is
prohibited by the U.S. Department of Education.
Subpart D--Individual Training Accounts
1. Definition of an Individual Training Account: Information
regarding Individual Training Accounts (ITA) is contained in
Secs. 663.400 through 663.430. A key reform tenet of the Workforce
Investment Act is that adults and dislocated workers who have been
determined to need training, may access training with an Individual
Training Account. The regulation at Sec. 663.410 provides a definition
for an ITA that seeks to provide maximum flexibility to State and local
program operators in managing ITA's. These regulations do not establish
the procedures for making payments, restrictions on the duration or
amounts of the ITA, or policies regarding exceptions to the limits, but
provide that authority to the State or Local Boards. However, this
authority to restrict the duration of ITA's or restrict funding amounts
should not be used to establish limits that arbitrarily exclude
eligible providers.
2. Exceptions to ITA's: The Act at section 134(d)(4)(G)(ii) and
Sec. 663.430 of the regulations provide that, under certain limited
circumstances, contracts for training rather than ITA's may be used.
Specifically, on-the-job training contracts with employers and
customized training contracts are authorized. Contracts may also be
used when there is an insufficient number of eligible providers in a
local area. This exception applies primarily to rural areas. The
exceptions to ITA's are to be used infrequently. The Act reforms the
local service delivery system by eliminating the current practice of
assigning participants to contracted training services and instead
establishing a system that maximizes customer choice in the selection
of training providers. When the Local Board determines there are an
insufficient number of eligible providers in the local area to
accomplish the purposes of a system of ITA's, and intends to use
contracts for services, there must be at least a 30 day public comment
period for interested providers.
Contracts for Special Populations--Contracts for training are also
authorized when the Local Board determines that there are special
populations that face multiple barriers to employment, as identified in
Sec. 663.430(b), and that there is a training services program of
demonstrated effectiveness offered by an eligible provider. Section
663.430(a)(3) explains that an eligible provider in this case is a
community based organization (CBO) or other private organization. The
Department has received many suggestions about this exception and the
extent to which it may be used. This exception is intended to meet
special needs and should be used infrequently. Those training providers
operating under the ITA exceptions still must qualify as eligible
providers, as required at Sec. 663.505. The Department believes that
effective eligible training providers, including CBO's and other
training providers, can and will compete for individual training
accounts and, that providers should view the use of ITA's as an
opportunity to expand their customer base.
Criteria for ``Demonstrated Effectiveness''--The regulation at
Sec. 663.430(a)(3) provides that when the exception for special
populations is used, the Local Board must apply criteria it develops to
determine ``demonstrated effectiveness,'' particularly as it applies to
the special participant population it proposes to serve. This
determination is in addition to meeting the requirements for qualifying
as an eligible training provider. The provisions in the regulation are
illustrative and Local Boards should develop specific criteria
applicable to their local areas.
Subpart E--Eligible Training Providers
1. Subpart E describes the methods by which organizations qualify
as eligible providers of training services under WIA. It also describes
the roles and responsibilities of Local Boards and the State in
managing this process. Although no single entity has full
responsibility for the entire process, the State must play a leadership
role in ensuring the success of the eligible provider system. The
Governor establishes minimum performance levels for initial
determination of non-Higher Education Act/registered apprenticeship
providers and for all subsequent eligibility determinations. The Local
Board may establish additional local performance levels for subsequent
eligibility determinations. The eligible provider process requires a
collaborative effort among the State, Local Boards, and other partners.
The regulations attempt to amplify and clarify the intent of the Act,
by linking statutory language on eligible providers in WIA section 122
with section 134 provisions covering Individual Training Accounts. In
Sec. 663.505, the regulations clarify that all training providers,
including those operating under the ITA exceptions, must qualify as
eligible providers, except for those engaged in on-the-job and
customized training (for which the Governor should establish qualifying
procedures as discussed in Sec. 663.595). Finally, in order to ensure
the strong relationship between the eligible provider process and
program performance, the regulation at Sec. 663.530 establishes a
maximum eighteen month period for an organization's initial
determination as an eligible provider.
The Department heard concern that some traditional providers of
training under previous workforce programs, such as community-based
organizations, would face difficulties in participating in this system.
The regulations clarify that such organizations have the opportunity to
deliver training funded under WIA, provided they deliver services that
customers value and meet training performance requirements. It is
important that States provide access to these organizations in order to
maximize customer choice. States should provide access to a broad and
diverse set of providers, including CBO's, while maintaining the
quality and integrity of training services.
Subpart F--Priority and Special Populations
1. Priority Under Limited Adult Funding: This subpart contains
requirements related to the statutorily-required priority for the use
of adult funds when funds are limited. WIA section 134(d)(4)(E) states
that in the event that funds allocated to a local area for adult
employment and training activities are limited, priority shall be given
to recipients of public assistance and other low-income individuals for
intensive services and training services. The appropriate Local Board
and the Governor must direct the One-Stop operators in the local area
with regard to making determinations related to such priority. The
Department assumes that adult funding is generally limited because
there are not enough adult funds available to provide services to all
of the adults who could benefit from such services. However, the
Department also recognizes that conditions are different from one area
to another and funds might not be limited in all areas. Because of
this, the regulation requires that all Local Boards must consider the
availability of funds in their area. In making this determination, the
availability of other Federal funding, such as TANF and Welfare-to-Work
[[Page 18674]]
funds, should be taken into consideration. Unless the Local Board
determines that funds are not limited in the local area, the priority
requirement will be in effect. States and Local Boards must work
together to establish the criteria that must be used in making this
determination. States and Local Boards also may administer their
priority for adult recipients of public assistance and other low income
adults so as not to preclude providing intensive and training services
to other individuals.
A substantial number of parties expressed views on the priority
issue. Many believed that the Department should not write any
regulations that would, in effect, establish a nationwide priority.
Some believed that the Department should not write any regulations at
all on this section of the statute. However, the Department believes
that the interpretation of this requirement is of such importance that
there must be regulations. This section reiterates the statutory
language that provides States and Local Boards with the authority to
determine the criteria to be applied when making the determination that
there are sufficient funds available so that the priority is not in
effect. Section 663.610 clarifies that the statutory priority only
applies to adult funds for intensive and training services, and not to
dislocated worker funds.
2. Welfare-to-Work and Temporary Assistance to Needy Families as
Part of One-Stop: At Sec. 663.620, the regulation discusses the
relationship of the Welfare-to-Work program and the Temporary
Assistance to Needy Families (TANF) program to the One-Stop delivery
system. Welfare-to-Work is a required partner to which the One-Stop
partner regulations apply. The TANF agency is specifically suggested as
an additional partner. Both programs can benefit from close cooperation
with the One-Stop delivery system because their respective participants
will have access to a much broader range of services to promote
employment retention and self-sufficiency.
Subpart G--On-the-Job Training and Customized Training
1. Sections 663.700 through 663.720 are the regulatory provisions
for conducting on-the-job (OJT) and customized training activities.
They include specific information regarding general, contract, and
employer payment requirements. The Department received input advocating
OJT regulations which do not restrict the duration of OJT and which
permit eligible employed workers to also receive this training. Unlike
JTPA, OJT is not limited to six months. However, as specified in WIA
section 101(31)(C), it is limited in duration as appropriate for the
occupation being trained for. Section 663.705 establishes requirements
that permit OJT contracts for employed workers.
Some parties called for minimal regulations in this area; however,
there were a few who suggested the need for information regarding
documentation requirements to avoid audit exceptions. Section 663.710
provides that employers are not required to document the extraordinary
costs associated with providing OJT, and no further documentation
requirements are established. Instead, program operators should put
emphasis on the development and/or selection of OJT assignments that
meet the identified needs of the participants.
Subpart H--Supportive Services
1. Flexibility in the Provision of Supportive Services: The
regulations in subpart H define the scope and purpose of supportive
services and the requirements governing their disbursement. A
fundamental principle of WIA is to provide local areas with the
authority to make policy and administrative decisions as well as the
flexibility to tailor the workforce investment system to meet the needs
of the local community. To ensure this flexibility, the regulations
afford local areas the discretion to provide supportive services as
they deem appropriate with limitations only in the areas defined in the
Act. Local Boards are required to develop policies and procedures
addressing coordination with other entities to ensure non-duplication
of resources and services, as well as any limits on the amount and
duration of such services. Attention should be given to developing
policies and procedures that ensure that the supportive services
provided are not available through other agencies and that they are
necessary for the individual to participate in title I activities.
2. Needs-Related Payments: There were a number of issues regarding
the eligibility requirements for dislocated workers to receive needs-
related payments that came to our attention, including the concern that
training enrollment requirements restrict the numbers of individuals
eligible to receive this income support which they need to participate
in training. Studies show that early entry into training for dislocated
workers who require it is a key factor in reducing the period of
unemployment during the adjustment process. Early intervention
strategies and policies are best implemented through quality rapid
response assistance which includes comprehensive core services, and the
provision of other reemployment assistance, including intensive and
training services, as soon as the need can be identified, preferably
before layoff. The statute authorizes all levels of assistance under
title I of WIA to many workers six months (180 days) before layoff, or
at least as soon as a layoff notice is received. Providing these
workers with access to quality information regarding all adjustment
assistance available in the community, including any deadlines that
must be met, is critical for workers to make intelligent reemployment
choices. Thus, many of the concerns raised can be resolved through the
use of early intervention strategies. The Department has decided to
issue only limited regulations on needs-related payments eligibility at
Sec. 663.815 through Sec. 663.840.
Part 664--Youth Activities Under Title I
Introduction
The youth regulations attempt to reflect the intent of the
legislation by moving away from one-time, short-term interventions and
moving to a systematic approach that offers youth a broad range of
coordinated services. Such offerings include opportunities for
assistance in both academic and occupational learning; developing
leadership skills; and preparing for further education, additional
training, and eventual employment. Rather than supporting separate,
categorical programs, the youth regulations are written to facilitate
the provision of a menu of varied services that may be provided in
combination or alone at different times during a youth's development.
Legislation creating the youth council, the local entity
responsible for recommending and coordinating youth policies and
programs, intends that the youth council be a catalyst for such broad
change. The regulations support that legislative intent.
Flexibility for local program operators in conducting youth
programs is key to the legislation and these regulations. The
Department encourages local decision making in terms of policy, youth
program design within the statutory framework, and determining
appropriate program offerings for each individual youth. It is the
Department's expectation that these offerings will provide needed
guidance for youth that is balanced with appropriate
[[Page 18675]]
consideration of each youth's involvement in his or her training and
educational plan. Further, the regulations support strong connections
between youth program activities and the One-Stop service delivery
system, so that youth learn early in their development how to access
the services of the One-Stop system and continue to use those services
throughout their working lives.
Subpart A--Youth Councils
1. This subpart explains the purpose of youth councils. The youth
council is a new feature of the workforce investment system that helps
develop youth employment and training policy, brings a youth
development perspective to the establishment of such policy,
establishes linkages with other local youth services organizations, and
takes into account a range of issues that can have an impact on the
success of youth in the labor market. Working with the youth council,
the Local Board has responsibility for oversight of youth programs. It
may be advantageous for Local Boards to delegate responsibility for
oversight of youth programs to youth councils which have expertise in
youth issues, as is permitted by Sec. 664.110.
Subpart B--Eligibility for Youth Services
1. Definition of Sixth Eligibility Barrier: Under section
101(13)(C)(vi) of the Act, a low income youth is eligible for services
if he or she ``requires additional assistance to complete an
educational program, or to secure and hold employment.'' The regulation
at Sec. 664.210 envisions that Local Boards will define this term,
however, if State policy is set regarding this provision, the policy
must be described in the State Plan.
2. Registering Youth Participants: Section 664.215 provides that
all youth participants be registered by collecting information for
supporting eligibility determinations, as well as EEO data. The EEO
data must be collected on individuals when any assessment or
discretionary decision regarding an individual is made. Such
assessments include decisions regarding service or program eligibility,
either positive or negative, and decisions made on the part of any
workforce investment system employee which lead to a targeting of
services for the individual. The Department will issue further guidance
regarding this data collection requirement.
3. Non-Income Eligible Youth: Section 129(c)(5) of the Act provides
that up to five percent of youth participants served in a local area
may be individuals who do not meet income criteria for eligible youth,
provided that they meet one or more of the criteria specified in
section 129(c)(5) of the Act and the regulations at Sec. 664.220. Local
Boards may define the term ``serious barriers to employment'' and
describe it in the Local Plan.
4. Eligibility under the National School Lunch Program: Eligibility
for free school lunches is not a substitute for income eligibility
under the Act. The Department received suggestions that program
operators be allowed to use eligibility for free lunch as a substitute
for determining eligibility under the Act, and encouraging the
Department to seek a technical amendment that would include such a
provision in the legislation. The Department recognizes the importance
of this issue, yet lacks statutory authority to change the Act's income
eligibility requirements.
5. Eligibility of Youth with Disabilities: Section 664.250 provides
that a disabled individual whose family income exceeds maximum income
levels under the Act may qualify for services if the individual's own
income meets the income criteria established in WIA section 101(25)(F),
or the eligibility criteria for cash payments under any Federal, State
or Local public assistance program. (WIA section 101(25)(B).)
Subpart C--Out of School Youth
1. Defining Out-of-School Youth: Sections 664.300, 664.310, and
664.320 address issues related to out-of-school youth. Section 101(33)
of the Act defines ``out-of-school youth'' as: eligible youth who are
school dropouts or who have received a secondary school diploma or its
equivalent, but are basic skills deficient, unemployed, or
underemployed. Youth enrolled in alternative schools are not school
dropouts. The Department received a number of requests that it seek a
technical amendment that would allow youth attending alternative
schools to be included in the definition of ``dropout,'' noting that
this would permit Local Boards to provide services to more youth in
alternative educational environments and to design programs that take
advantage of local resources and best meet the needs of local youth.
While recognizing the importance of local flexibility and of serving
youth in alternative school settings, the Department lacks statutory
authority to change definitions established under the Act. Section
664.310 of the regulations clarifies this issue.
2. Funds for Summer Activities for Out-of-School Youth: The
Department received a number of inquiries asking if summer activities
are exempt from the requirement that 30 percent of youth funds be spent
on services for out-of-school youth. Transition guidance will address
how the 30% requirement applies to the Program Year 1999 JTPA summer
funds. Section 664.320 clarifies that there is no exemption from this
requirement for summer activities. There is no separate summer program
under the Act. A single allocation of youth funds is available to local
areas for year-round and summer activities. Thirty percent of the total
youth allocation must be spent on services for out-of-school youth.
This 30 percent, like the remaining 70 percent, may or may not be
proportional between summer and year-round activities, as determined by
the Local Board in consultation with the chief elected official.
Subpart D--Youth Program Design, Elements, and Parameters
1. Program Design: Features of the youth program design are
outlined in section 129(c) of the Act. While there are three program
design categories and ten program elements are required, there is
individual program design flexibility and flexibility in determining
the definition, scope, and characteristics of the elements.
Program Design Categories--Under section 129(c)(1), three
categories provide the framework for youth program design. They are:
(1) An objective assessment of each participant; (2) individual service
strategies; and (3) services that prepare youth for postsecondary
educational opportunities, link academic and occupational learning,
prepare youth for employment, and provide connections to intermediary
organizations linked to the job market and employers.
Linkages to Entities--Youth councils and programs are required to
establish linkages to entities that will foster the participation of
eligible youth. Suggested linkages are included in Sec. 664.400(c).
Information and Referrals--Section 129(c)(3) of the Act requires
that Local Boards ensure that eligible youth receive information and
referrals, including information on the full array of appropriate
services available to them and referrals to appropriate training and
educational programs. Youth program providers must ensure that eligible
applicants who do not meet the enrollment requirements of their program
or who cannot be served by their program are referred for additional
assessment and program placement. This language was included in
Sec. 664.400(d) of the regulations to emphasize the importance of
referrals as
[[Page 18676]]
a part of overall youth program design. To further promote the concept
of seamless One-Stop service delivery, One-Stop operators are
encouraged to send those youth assessments that are completed at the
One-Stop center to other training and educational programs to which the
youth is referred.
2. Program elements: Section 129(c)(2) of the Act lists 10 program
elements that must be generally available to youth through local
programs. The Department received requests for clarification that not
all of the 10 youth program elements must be provided to every youth
participant, and this interpretation is included in Sec. 664.410(b).
Local program operators must determine what program elements will be
provided to each youth participant based on the participant's objective
assessment and service strategy; however, it is envisioned that each
youth will participate in more than one of the ten program elements
required as part of any local youth program, and all youth must receive
follow-up services. For example, even if it is determined appropriate
that a youth participate in only summer employment activities, he or
she would still receive at least 12 months of followup services.
Followup service requirements are fully described in Sec. 664.450.
Sections 664.420 through 664.470 further define and discuss five
program elements: leadership development, positive social behaviors,
supportive services, followup services, and work experiences.
Leadership Development--The Act states that youth programs must
provide leadership development opportunities, and gives the following
examples of such activities: community service and peer-centered
activities encouraging responsibility and other positive social
behaviors during non-school hours. Some additional examples of
leadership development activities are outlined in Sec. 664.420 which
elaborates on the definition of leadership development opportunities.
The development of leadership abilities might address team work,
decision making, personal responsibility, and citizenship training, as
well positive social behavior training in areas such as positive
attitudinal development, self esteem building, issues of cultural
diversity, and other skills and attributes that would help youth to
lead effectively, responsibly, and by example.
Supportive Services--The Act states that youth programs must
provide supportive services. Section 101(46) of the Act defines
supportive services to include services such as transportation, child
care, dependent care, housing, and needs-related payments, that are
necessary to participate in activities authorized under the Act.
Section 664.440 elaborates on the definition of supportive services as
it applies to youth. Such services may include: linkages to community
services; referrals to medical services; and assistance with work
attire and work-related tool costs, including such items as eye glasses
and protective eye gear.
Followup Services--The Act states that followup services will be
provided for not less than 12 months after the completion of
participation, as appropriate. Section 664.450(b) clarifies that all
youth participants must receive some form of followup services. Such
services must be for a minimum of 12 months. Followup services for
youth who participate in only summer employment activities may,
however, be less intensive than for those youth who participate in
other types of activities. Program operators are encouraged to consider
the intensity of the services provided and the needs of the individual
youth in determining the appropriate level of followup services. This
section also provides that followup may include leadership development
or supportive service activities, as well as other allowable
activities, and provides additional examples of permissible followup
services.
Evaluation studies such as Abt Associates' Final Report on the
National JTPA Study, have shown disappointing results for short-term
job training programs for youth. Meanwhile, programs such as STRIVE and
the Children's Village have shown much success with longer-term
followup strategies. A 1993 study by MDRC showed that the Center for
Employment Training, which features close ties to the private sector
and a strong job placement component with followup with employers,
increased the earnings of enrollees by $3,000 a year over a control
group during the last two years of a four-year evaluation.
Work Experiences--Sections 664.460 and 664.470 address work
experiences for youth. Work experiences are planned, structured
learning experiences that take place in a workplace for a limited
period of time. No specific time period is specified. As provided in
section 129(c)(2)(D) of the Act, work experiences may be paid or
unpaid, as appropriate. Section 664.460 states that work experiences
may be in the private for-profit sector, the nonprofit sector, or the
public sector, and gives examples of the types of activities that work
experiences may include, such as On-the-Job Training (OJT). While OJT
is likely not an appropriate activity for most youth under age 18, it
may be used as a service strategy for such youth based on the needs
identified in an objective assessment of an individual youth
participant. Section 664.470 provides that youth funds may be used to
pay the wages of youth in work experience. Youth funds may be used to
pay the wages of youth in work experiences, including in the private,
for-profit sector, under conditions designed to protect youth and
incumbent workers when the purpose of the work experiences is to
provide youth with opportunities for career exploration and skill
development and not to benefit the employer. If an unpaid work
experience creates an employer/employee relationship, federal wage
standards may apply. This relationship is determined under the Fair
Labor Standards Act.
Subpart E--Concurrent Enrollment
1. Concurrent Enrollment in Youth and Adult Programs: Under the
Act, an eligible youth is an individual 14 through 21 years of age.
Adults are defined in the Act as individuals age 18 and older. The
Department received suggestions that local program operators be allowed
to decide whether youth or adult services are appropriate for
individuals aged 18 through 21 based on individual participant
assessments and service strategies. The Department encourages local
flexibility in serving both youth and adult participants, and thus
included this clarification in the regulations. Section 664.500(b)
clarifies that eligible youth who are 18 through 21 years old may
participate in youth and adult programs concurrently, as appropriate
for the individual. Such individuals must meet the eligibility
requirements under the applicable youth or adult criteria for the
services received. Local program operators must identify and track the
funding streams for services provided to individuals who participate in
youth and adult programs concurrently, ensuring non-duplication of
services.
2. Individual Training Accounts for Youth: Section 664.510 states
that ITA's are not an authorized use of youth funds. The ITA is the
currency of a market-based system that enables adults to select the
service providers most suited to their needs based on information about
the past performance of such providers. Under the Act, ITA's are not
authorized for youth below age 18. Providers of youth services are
competitively selected based on predetermined criteria, the judgment of
Local Boards, and recommendations of youth councils about the
providers' ability to meet the needs of youth
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participants. Youth aged 18 through 21 can access ITA's under the adult
or dislocated worker program, if appropriate.
Subpart F--Summer Employment Opportunities
1. Summer Employment Activities: This subpart provides
clarification about summer youth employment. Although all Local Boards
must offer summer employment opportunities for eligible youth as one of
the ten required program elements listed in WIA section 129(c)(2) and
Sec. 664.410, the proportion of youth funds used for summer employment
is determined by the Local Board in consultation with the chief elected
official. Section 664.600 elaborates on the activities that must be
included in all summer employment opportunities, including direct
linkages to academic and occupational learning, as well as followup
services for at least 12 months. Numerous inquiries were received about
whether the Act would allow cities and counties to continue to operate
their summer activities. Section 664.610 provides that this practice is
still allowed, and clarifies that if summer employment opportunities
are provided by entities other than the grant recipient/fiscal agent,
the providers must be selected by awarding a grant or contract on a
competitive basis based on recommendations of the youth council and on
criteria contained in the State plan.
2. Application of Performance Indicators: In terms of performance
measurement, the Department received requests for clarification on
whether all of the core indicators listed in the Act apply to the
summer program element as well as to youth activities that are longer
in duration. It is important to note that the core indicators specified
in section 136 of the Act apply to all youth program activities. This
is consistent with the intent of the Act to move from a focus on
separate, categorical programs to a more systematic approach to
workforce investment and serving the needs of youth. Summer employment
opportunities then, are to be viewed as one element among many
available to youth as a part of a menu of activities offered by the
Local Board. Section 664.620 indicates that summer activities, as part
of the overall youth program, are required to meet the same core
indicators of performance as the other youth activities.
Subpart G--One-Stop Career Center Services to Youth
1. The Connection between the Title I Youth Program and the One-
Stop Delivery System: This subpart explains that the chief elected
official (as the local grant recipient for the youth program), as a
required One-Stop partner, is subject to the One-Stop provisions
related to such partners described in part 662 of the regulations and
is responsible for connecting the youth program and its activities to
the One-Stop system. In addition to the provisions of part 662,
connections between the youth program and the One-Stop system may
include those that facilitate:
<bullet> The coordination of youth activities;
<bullet> Connections to the job market and employers;
<bullet> Access for eligible youth to information and services; and
<bullet> Other activities designed to achieve the purposes of the
youth program.
The Department received requests for clarification on connecting
youth program activities to the One-Stop delivery system; however, some
parties felt that the youth program, as a One-Stop partner, should not
be made to conform to the same One-Stop partner requirements as other
partners. The Rule attempts to clarify the role of the youth program in
the One-Stop center through a cross-reference to the One-Stop
regulations found in 20 CFR, part 662.
2. Universal Access to One-Stop Centers for Youth under 18: Under
section 134(d)(2) of the Act, adults have access to core services in
One-Stop centers without regard to eligibility. Adults are defined
under the Act as persons aged 18 and above. Section 664.710 of the
regulations clarifies that local area youth, including youth under age
18 who are not eligible under the title I youth program, may receive
services through the One-Stop centers; however, services for such youth
must be funded from sources that do not restrict eligibility for
services, such as Wagner-Peyser. The Department believes that the
intent of the Act is to introduce youth, particularly out-of-school
youth, to the services of the One-Stop system early in their
development and to encourage the use of the One-Stop system as an entry
point to obtaining education, training, and job search services.
Subpart H--Youth Opportunity Grant Programs
This subpart explains that competitive procedures for awarding
Youth Opportunity Grants will be established by the Secretary. It also
restates statutory language regarding the eligibility of Local Boards
and other entities in high poverty areas to apply for Youth Opportunity
Grants. Provisions of the Act regarding eligibility for services under
Youth Opportunity Grants and the process for establishing performance
measures are clarified at Secs. 664.800 to 664.830. The Department
views these grants as a distinct opportunity to provide a variety of
needed services to youth in high poverty areas, building on the current
successful activities and innovations already at work in many
communities.
Part 665--Statewide Activities Under Title I of the Workforce
Investment Act
Introduction
This part addresses the funds reserved at the State level for
workforce investment activities under sections 128(a) and 133(2) of
WIA.
Subpart A--General Description
This subpart provides a general description of Statewide activities
conducted with up to 15 percent reserved from youth, adult and
dislocated worker funding streams (``15 percent funds''), and up to an
additional 25 percent of dislocated worker funds reserved for Statewide
activities from annual allotments to the State.
1. Section 665.110(b) explains that the 15 percent reserved funds
may be pooled and expended on workforce investment activities without
regard to the source of the funding. For example, funds reserved from
the adult funding stream may be used to carry out Statewide youth
activities and vice versa. The Department believes that the use of
these funds can provide critical leadership in the development and
continuous improvement of a comprehensive workforce investment system
for each State and, as a result, create a national system to which job
seekers and workers can look for expert assistance, and employers can
look for a qualified workforce.
Subpart B--Required and Allowable Statewide Workforce Investment
Activities
This subpart discusses required and optional activities conducted
with funds reserved from the three title I funding streams (youth,
adults, and dislocated workers).
1. Required Activities: Section 665.200 identifies the eight
activities which each State is required to carry out with its reserved
funds from the three funding streams. The Governor must reserve funding
for these activities, but has discretion to determine the amount
reserved, up to the maximum 15 percent of each funding stream. One use
of these funds is administration, subject to the five percent
administrative cost
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limitation at 20 CFR 667.210(a)(1). This section clarifies that while
there is no specific amount for each of the seven of the eight required
activities to be carried out with the 15 percent funds, it is expected
that the State will expend a sufficient amount to ensure effective
implementation of those activities. The eighth required activity, rapid
response, is discussed in subpart C.
2. Optional Activities: Section 665.210 also identifies activities
which each State is allowed to carry out with the 15 percent funds. For
the first time, States have the discretion to conduct research and
demonstration projects, and incumbent worker projects, including the
establishment and implementation of an employer loan program. Section
665.220 makes clear that employed (incumbent) workers served under
projects funded with these reserve funds are not required to meet the
requirements that training is needed to lead to a self-sufficient wage
applicable to employed adult or dislocated workers served with local
formula funds.
Subpart C--Rapid Response Activities
This subpart addresses the use of funds that must be reserved (up
to 25 percent of dislocated worker funds allotted to States under
section 132(b)(2)(B) of WIA) to provide rapid response assistance.
1. Section 665.300 describes what are rapid response activities and
who is responsible for providing them. Rapid response assistance
commences at the site of dislocation as soon as a State has received a
WARN notice, a public announcement or other information that a mass
dislocation or plant closure is scheduled to take place. The Department
believes that this early intervention feature for dislocated workers,
if provided in a comprehensive and systematic manner through
collaboration between the State and Local Boards, One-Stop partners and
other applicable entities, is critical to enabling workers to minimize
the duration of unemployment following layoff. The Department strongly
urges States and Local Boards to implement processes that allow for
core services to be an integral part of rapid response assistance,
preferably on-site, if the size of the dislocation or other factors
warrant it. Further, WIA defines a dislocated worker at section 101(9)
in a way that permits formula funds to be used for intensive and
training services for workers: (1) As soon as they have layoff notices;
or (2) six months (180 days) prior to layoff if employed at a facility
that has made a general announcement that it will close within 180
days.
The Department believes that this is a critical period for workers,
States, Local Boards, One-Stop operators and partners to begin to make
important decisions. One important decision is whether there are
sufficient formula funds in the State (at the State or local levels) to
adequately serve the workers being dislocated, or whether national
emergency grant funds must be requested in a timely manner so that all
services are available to the workers when they need them.
2. In response to numerous concerns regarding whether rapid
response funds may be used beyond those types of required rapid
response assistance described in the Act and Sec. 665.310, the
Department has elaborated on the authorized rapid response activities
in the regulation at Sec. 665.320. These additional activities were
recommended by experts consulted on this topic.
3. Section 665.330 addresses the linkage of rapid response
assistance and WIA title I assistance to NAFTA-Transitional Adjustment
Assistance (NAFTA-TAA). This linkage is an important feature of the
One-Stop delivery system, and a requirement under NAFTA-TAA.
Part 666--Performance Accountability Under Title I of the Workforce
Investment Act
Introduction
This part presents the performance accountability requirements
under title I of the Act. This part of the regulations primarily
summarizes the statutory language in the Act and clarifies a few key
areas based on input the Department has received. WIA's purpose is to
provide workforce investment activities that improve the quality of the
workforce. The Department is strongly committed to a systemwide
continuous improvement approach, grounded upon proven quality
principles and practices. The regulations identify some of the major
issues where further guidance will be provided.
Subpart A--State Measures of Performance
1. Indicators: Section 666.100 identifies the 15 core indicators of
performance and the two customer satisfaction indicators that States
are required to address in title I grant applications. The 15 core
indicators represent the four core indicators that will be applied
separately for the three population categories (adult, dislocated
workers and eligible youth age 19 through 21) for a total of 12
indicators and the three youth indicators. There is one customer
satisfaction indicator for participants and one for employers. Section
666.110 clarifies that Governors may develop additional performance
indicators to be negotiated with Local Boards and that these additional
indicators must be included in the State Plan.
2. Definitions: Section 666.100(b) also explains that the
Departments of Labor and Education will issue more detailed definitions
for the title I and title II indicators after further consultation with
representatives identified in section 502(b) of WIA. The Departments
will consult further on the indicator definitions, including taking
into account factors such as the degree of difficulty and expense of
collecting data and reporting on the measures.
3. Negotiations: As noted at Sec. 666.120(a), the Department will
provide further guidance on each of these areas after additional
consultation. Section 666.120(b) addresses the requirement that States
must submit expected or proposed levels of performance for the core
indicators and customer satisfaction indicators for years one through
three of the State Plan. The Department may require States to express
levels of improvement as a percentage improvement over the previous
year's actual performance. The Department recognizes that continuous
improvement is more than incremental increases in performance and will
develop a comprehensive and rigorous approach to integrate continuous
improvement at all levels of the workforce investment system. The
Dep