HomeMy WebLinkAboutWIOA Joint Rule- ADA CompliantFEDERAL REGISTER
Vol. 81 Friday,
No. 161 August 19, 2016
Book 2 of 2 Books
Pages 55791-56470
Part V
Department of Labor
Employment and Training Administration
20 CFR Parts 676, 677, and 678
Department of Education
34 CFR Parts 361 and 463
Workforce Innovation and Opportunity Act; Joint Rule for Unified and
Combined State Plans, Performance Accountability, and the One -Stop
System Joint Provisions; Final Rule
55792 Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
DEPARTMENT OF LABOR
Employment and Training
Administration
20 CFR Parts 676, 677, and 678
Docket No. ETA -2015-0002]
RIN 1205-AB74
DEPARTMENT OF EDUCATION
34 CFR Parts 361 and 463
RIN 1830-AA21
Workforce Innovation and Opportunity
Act; Joint Rule for Unified and
Combined State Plans, Performance
Accountability, and the One -Stop
System Joint Provisions; Final Rule
AGENCY: Office of Career, Technical, and
Adult Education (OCTAE),
Rehabilitation Services Administration
RSA), Education; Employment and
Training Administration (ETA), Labor.
ACTION: Final rule.
SUMMARY: The Departments of
Education (ED) and Labor (DOL) (or,
collectively, Departments) issue this
Joint Final Rule to implement jointly
administered activities authorized by
title I of the Workforce Innovation and
Opportunity Act (WIOA) signed into
law on July 22, 2014 (hereafter " Joint
WIOA Final Rule"). Through these
regulations, the Departments implement
workforce education and employment
system reforms and strengthen the
nation' s public workforce development
system to provide increased economic
opportunity and make the United States
more competitive in the 21st century
evolving labor market. This Joint WIOA
Final Rule provides guidance for State
and local workforce development
systems that increase the skill and
credential attainment, employment,
retention, and earnings of participants,
especially those with significant barriers
to employment, thereby improving the
quality of the workforce, reducing
dependency on public benefits,
increasing economic opportunity, and
enhancing the productivity and
competitiveness of the nation.
DATES: This final rule is effective
October 18, 2016.
FOR FURTHER INFORMATION CONTACT:
DOL: Adele Gagliardi, Administrator,
Office of Policy Development and
Research, U.S. Department of Labor,
Employment and Training
Administration, 200 Constitution
Avenue NW., Room N-5641,
Washington, DC 20210, Telephone:
202) 693-3700 (voice) (this is not a toll-
free number) or 1-800-326-2577
TDD—Telecommunications device for
the deaf).
ED: Lekesha Campbell, U.S.
Department of Education, OCTAE, 400
Maryland Avenue SW., Room 11-145,
PCP, Washington, DC 20202-7240,
Telephone: (202) 245-7808; Edward
Anthony, U.S. Department of Education,
RSA, 400 Maryland Avenue SW., Room
5085 PCP, Washington, DC 20202-2800,
Telephone: (202) 245-7256.
If you use a telecommunications
device for the deaf (TDD) or a text
telephone (TTY), call the Federal Relay
Service (FRS), toll free, at 1-800-877-
8339.
SUPPLEMENTARY INFORMATION: This Joint
WIOA Final Rule reflects changes made
as a result of public comments received
to the joint Notice of Proposed
Rulemaking that was published on April
16, 2015, at 80 FR 20574.
WIOA strengthens the alignment of
the public workforce development
system' s six core programs by
compelling unified strategic planning
requirements, common performance
accountability measures, and
requirements governing the one-stop
delivery system. In so doing, WIOA
placed heightened emphasis on
coordination and collaboration at the
Federal, State, local, and tribal levels to
ensure a streamlined and coordinated
service delivery system for job seekers,
including those with disabilities, and
employers. These regulations lay the
foundation, through coordination and
collaboration at the Federal level, for
implementing the Departments' vision
and goals of WIOA.
In addition to this Joint WIOA Final
Rule, the Departments are issuing
separate final rules to implement
program -specific requirements of WIOA
that fall under each Department' s
purview. The DOL is issuing a Final
Rule governing program -specific
requirements under titles I and III of
WIOA (hereinafter " DOL WIOA Final
Rule"). The ED is issuing three final
rules: One implementing program -
specific requirements of the Adult
Education and Family Literacy Act
AEFLA), as reauthorized by title II of
WIOA; and two final rules
implementing all program -specific
requirements for programs authorized
under the Rehabilitation Act of 1973, as
amended by title IV of WIOA. The
Department -specific final rules are
published elsewhere in this issue of the
Federal Register. Developing and
issuing all five WIOA final rules
collaboratively reinforces WIOA' s
heightened emphasis on coordination
and collaboration to ensure an
integrated and seamless service delivery
system for job seekers and employers.
Preamble Table of Contents
I. Executive Summary
II. Acronyms and Abbreviations
III. Public Comments Received on the Notice
of Proposed Rulemaking
IV. Section -by -Section Discussion of Public
Comments and Final Regulations
A. Unified and Combined State Plans
Under Title I of the Workforce
Innovation and Opportunity Act (20 CFR
Part 676; 34 CFR Part 361, Subpart D; 34
CFR Part 463, Subpart H)
B. Performance Accountability Under Title
I of the Workforce Innovation and
Opportunity Act (20 CFR Part 677; 34
CFR Part 361, Subpart E; 34 CFR Part
463, Subpart I)
C. Description of the One -Stop System
Under Title I of the Workforce
Innovation and Opportunity Act (20 CFR
Part 678; 34 CFR Part 361, Subpart F; 34
CFR Part 463, Subpart J)
V. Rulemaking Analyses and Notices
A. Executive Orders 12866 and 13563:
Regulatory Planning and Review
B. Regulatory Flexibility Act
C. Small Business Regulatory Enforcement
Fairness Act of 1996
D. Paperwork Reduction Act
E. Executive Order 13132 ( Federalism)
F. Unfunded Mandates Reform Act of 1995
G. Plain Language
H. Assessment of Federal Regulations and
Policies on Families
I. Executive Order 13175 ( Indian Tribal
Governments)
J. Executive Order 12630 ( Government
Actions and Interference With
Constitutionally Protected Property
Rights)
K. Executive Order 12988 (Civil Justice
Reform)
L. Executive Order 13211 ( Energy Supply)
I. Executive Summary
Purpose of This Regulatory Action:
President Barack Obama signed WIOA
into law on July 22, 2014. WIOA is the
first legislative reform of the public
workforce system in more than 15 years,
which passed Congress by a wide
bipartisan majority. WIOA supersedes
the Workforce Investment Act of 1998
WIA) and amends the Wagner-Peyser
Act and the Rehabilitation Act of 1973.
WIOA strengthens and improves our
nation' s public workforce system and
increases economic opportunities for
individuals in the United States,
especially youth and individuals with
significant barriers to employment, to
secure and advance in employment.
WIOA reaffirms the role of the
customer -focused one-stop delivery
system, a cornerstone of the public
workforce development system, and
enhances and increases coordination
among several key employment,
education, and training programs.
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WIOA supports innovative strategies
to improve coordination among the six
core programs and other Federal
programs that support employment
services, workforce development, adult
education and literacy, and vocational
rehabilitation (VR) activities.
In WIOA, Congress directed the
Departments to issue regulations
implementing statutory requirements to
ensure that the public workforce system
operates as a comprehensive, integrated,
and streamlined system to provide
pathways to prosperity and
continuously improve the quality and
performance of its services to job
seekers and to employers. Therefore, the
Departments are issuing this Joint WIOA
Final Rule to implement jointly
administered activities authorized
under WIOA, specifically those related
to the Unified and Combined State
Plans, performance accountability, and
the one-stop delivery system. In an
effort to promote collaboration and
coordination at the State and local
levels among the core programs and
other Federal partner programs, the
Departments have collaborated
extensively with the Department of
Health and Human Services (HHS) and
other Federal agencies in developing
this Final Rule.
The Departments are publishing this
Joint WIOA Final Rule to implement
those provisions of WIOA that affect all
of the six core programs, specifically
the: Adult, dislocated worker, and youth
programs authorized under title I and
administered by DOL; AEFLA program
authorized under title II and
administered by ED; Employment
Service program authorized under the
Wagner-Peyser Act, as amended by title
III, and administered by DOL (Wagner-
Peyser Act Employment Service
program); and VR program, authorized
under title I of the Rehabilitation Act of
1973, as amended by title IV, and
administered by ED. The requirements
in these joint final regulations will be
jointly administered by both
Departments. The regulations contained
in this Final Rule also impact other
Federal programs that participate in the
one-stop system and/ or are identified as
partner programs in a State' s Combined
State Plan if a State elects to submit
such Plan rather than a Unified State
Plan.
A critical part of the implementation
of WIOA is the collection and reporting
of accurate, timely information about
individuals who receive services
through the programs authorized under
the law. Such information is critical to
inform public policy and support
analysis of effective strategies. In
keeping with the Paperwork Reduction
Act (PRA), the methods for collecting
such information are provided to the
public for comment through information
collection requests (ICRs). The Joint
WIOA Final Rule had two
accompanying requests to support the
performance and planning aspects of
these rules. Soon after publication of the
Notice of Proposed Rulemaking (NPRM)
80 FR 20574, April 16, 2015), the
Departments published a notice in the
Federal Register announcing the joint
ICR for the WIOA Performance
Management, Information, and
Reporting System ( 80 FR 43474, July 22,
2015) and requested comments on this
ICR during a 60 -day public comment
period (hereinafter " WIOA Joint
Performance ICR") ( see https://
www.regulations.gov/# !docket
Detail;D=ETA-2015-0007). On
September 1, 2015, DOL solicited
comments on its own WIOA
performance accountability ICR to
require the following programs to report
on a standardized set of data elements
through the WIOA Workforce
Performance Accountability,
Information, and Reporting System:
WIOA adult, dislocated worker, and
youth, Wagner-Peyser Act Employment
Service, National Farmworker Jobs
Programs (NFJP), Trade Adjustment
Assistance, YouthBuild, Indian and
Native American (INA) grantees, and the
Jobs for Veterans' State Grants ( 80 FR
52798) (hereinafter " DOL Performance
ICR") ( see https:// www.regulations.gov/
docketDetail;D=ETA-2015-0008). On
April 16, 2015, ED solicited comments
on its ICR related to the VR program
Case Service Report (RSA -911) to
require VR agencies to report data
required under sec. 101( a)( 10) of the
Rehabilitation Act, of 1973, as amended
by WIOA, as well as performance
accountability data under title I of
WIOA (hereinafter " RSA -911"). The
Departments received 112 public
comment submissions in response to the
WIOA Joint Performance ICR, DOL
received public comments on the DOL
Performance ICR, and ED received
public comments on the RSA -911
respectively).
On August 6, 2015, the Departments,
together with the Departments of Health
and Human Services, Agriculture, and
Housing and Urban Development
HUD), proposed a new information
collection regarding required elements
for submission of the Unified or
Combined State Plan and Plan
modifications under WIOA (hereinafter
State Plan ICR") ( 80 FR 47003) ( see
https:// www.regulations.gov/
docketDetail;D=ETA-2015-0006). The
State Plan ICR received a total of 16
public comments. These public
comment submissions informed the
development of the final State Plan ICR,
which the Office of Management and
Budget (OMB) approved on February 19,
2016. Most provisions in titles I through
III of WIOA took effect on July 1, 2015,
the first full program year after
enactment; however, the new State
Plans and performance accountability
system requirements in the statute will
take effect on July 1, 2016. Title IV took
effect upon enactment unless otherwise
indicated.
Section V. Rulemaking Analysis and
Notices, D. Paperwork Reduction Act
provides summary information about
the public comments on the Joint
Performance ICR and the State Plan ICR.
In addition to this Joint WIOA Final
Rule, the Departments are publishing, in
separate regulatory actions published in
the Federal Register, four agency -
specific final rules that implement the
provisions of WIOA that are
administered separately by the
Departments— one published by DOL
implementing the agency -specific
provisions of title I, and three published
by ED implementing the agency -specific
provisions of titles II and IV. Readers
should note that there are a number of
cross-references in this Joint WIOA
Final Rule to the agency -specific final
rules. Finally, the Departments
structured this Joint WIOA Final Rule so
that the Code of Federal Regulations
CFR) parts will align with the CFR
parts in the agency -specific final rules.
To implement those provisions of
WIOA that affect the WIOA programs
and which will be jointly administered
by both Departments, these regulations
implement a number of improvements
that WIOA makes to the public
workforce system. These include
improvements to:
Ensure that workforce education
and employment services are
coordinated and complementary by
requiring a single, 4 -year strategic State
Plan for achieving the workforce goals
of the State. Additionally, States may
conduct, along with the core programs,
collaborative planning with other
Federal education and training
programs specified in WIOA;
Ensure that Federal investments in
education, employment, and training
are evidence -based, data -driven, and
accountable to participants and
taxpayers by establishing a common
performance accountability system for
the core programs, requiring other
authorized programs to report on the
common performance indicators, and
providing easy -to -understand
information to consumers and the
public about training providers and
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program performance to help inform
their decision-making; and
Enhance services provided to all job
seekers and employers through the one-
stop delivery system, also known as the
American Job Center system, by:
Requiring the colocation of the Wagner-
Peyser Act Employment Service
program; adding the Temporary
Assistance for Needy Families (TANF)
program as a required partner; providing
for State -established certification to
ensure high-quality American Job
Centers; requiring partners to dedicate
funding for allowable infrastructure and
other shared costs that are
commensurate to the partner' s
proportionate use and relative benefit
received by the program; and promoting
the development of integrated intake,
case management, and reporting
systems.
Changes From the Notice of Proposed
Rulemaking
The Departments published a Joint
WIOA NPRM on April 16, 2015 at 80 FR
20574. The Final Rule supports the
tenets expressed in the NPRM. In
response to comments received and to
strengthen the intent of the law, the
Departments have made numerous
revisions, including but not limited to
changes to the following areas:
State Plans: The Joint WIOA Final
Rule text, among other things: (1)
Clarifies the expected involvement of
stakeholders, core programs, and the
State Workforce Development Boards
WDBs) in the State Plan development;
2) ensures consistency by requiring a
description of joint planning and
coordination across core programs,
required one-stop partners, and other
programs and activities included in the
Unified and Combined State Plans; ( 3)
requires States to provide an
opportunity for public comment on and
input into the development of Unified
and Combined State Plans prior to their
submission, and (4) clarifies
requirements for Unified and Combined
State Plan modifications. The preamble
responds to suggestions regarding
certain Unified and Combined State
Plan requirements, as well as provides
further guidance and clarifications with
regard to certain regulatory
requirements governing the Unified and
Combined State Plans.
Performance Accountability: The
Joint WIOA Final Rule clarifies certain
definitions, primary indicators of
performance, and sanctions. Changes in
the Final Rule text include, among
others: ( 1) Revising the definitions of
participant," " exit," and " State;" ( 2)
clarifying the credential attainment rate
indicator; (3) adding the types of gain
that are included in the measurable skill
gains indicator; (4) clarifying the
difference between the " adjusted level
of performance" that is agreed upon at
the time the Unified or Combined State
Plan is approved and the " adjusted level
of performance" that is determined at
the end of the program year; and (5)
adding a phased -in approach for
sanctions due to failure to achieve
adjusted levels of performance and a
transition period for complete WIOA
data to be available. The preamble
explains intent to phase in
implementation of the " effectiveness in
serving employers" indicator and to
implement a uniform, national customer
satisfaction survey that is not tied to
accountability provisions or the
determination of sanctions. The
preamble also provides further guidance
and clarification regarding changes
made to the Final Rule text, including
the inclusion of outlying areas
American Samoa, Guam,
Commonwealth of the Northern Mariana
Islands, the U.S. Virgin Islands, and, as
applicable, the Republic of Palau) for
purposes of the performance
accountability system.
One -Stop Governance and
Operations: The Joint WIOA Final Rule
includes changes to the operational
aspects of one-stop operations
including, among others: ( 1) Revising
coverage of multiple program services
and staff coverage in one-stop affiliate
sites; ( 2) revising infrastructure funding
regulations, and emphasizing partners'
responsibilities towards infrastructure
costs; ( 3) providing detailed information
about career services; ( 4) clarifying the
involvement of the TANF programs as
one-stop partners; ( 5) simplifying
provisions governing Memoranda of
Understanding (MOU) negotiations; ( 6)
emphasizing the need to conduct an
open competition for one-stop operator
selection; ( 7); changing the requirements
related to hours of operation outside
normal business hours; (8) emphasizing
both physical and programmatic
accessibility; (9) clarifying when the
State funding mechanism is triggered for
the funding of the one-stop system,
including the funding limits applicable
to the State funding mechanism; and
10) establishing a deadline to conform
to the new common one-stop identifier.
As noted throughout this Final Rule,
the Departments will be issuing
guidance to help our regulated
communities understand their rights
and responsibilities under WIOA and
these regulations. Consistent with the
Administrative Procedure Act' s
exemption from its notice and comment
requirement for general statements of
policy, interpretations and procedural
instructions, this guidance will provide
interpretations of many of the terms and
provisions of these regulations and more
detailed procedural instructions that
would not be appropriate to set out in
regulations. The Departments will also
be issuing guidance to provide
information on current priorities and
initiatives, suggested best practices, and
in response to stakeholder questions.
The Departments also made a number
of non -substantive changes to correct
grammatical and typographical errors to
improve the readability and conform the
document stylistically that are not
discussed in the analysis below.
II. Acronyms and Abbreviations
AEFLA Adult Education and Family
Literacy Act
ABAWD Able -Bodied Adults Without
Dependents
ABS Adult Basic Skills
APA Administrative Procedure Act
BFET Basic Food Employment and Training
BLS Bureau of Labor Statistics
CBO Community-based organization
CEO Chief elected official
CFR Code of Federal Regulations
CHIP Children' s Health Insurance Program
CMS Case Management System
CRIS Common Reporting Information
System
CRO Community Rehabilitation
Organization
CSBG Community Services Block Grant
CTE Career and Technical Education
DOL U.S. Department of Labor
DSA Designated State Agency
DSU Designated State Unit
ED U. S. Department of Education
EEOC Equal Employment Opportunity
Commission
EFL Educational Functioning Level
E. O. Executive Order
ESEA Elementary and Secondary Education
Act of 1965
ESL English -as -a -second -language
ETA Employment and Training
Administration
ETP Eligible training provider
FEDES Federal Employment Data Exchange
System
FEIN Federal employer identification
number
FERPA Family Educational Rights and
Privacy Act
FY Fiscal Year
GED General Education Diploma
GPA Grade Point Average
GS General Schedule
HHS Department of Health and Human
Services
HSE High School Equivalency
HUD Department of Housing and Urban
Development
ICR Information Collection Request
INA Indian and Native American
INAP Indian and Native American
Programs
IPE Individualized Plan for Employment
IT Information technology
ITA Individual Training Account
JVSG Jobs for Veterans State Grants
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LMI Labor market information
LSAL The Longitudinal Study of Adult
Learning
MOU Memorandum of Understanding
NAICS North American Industry
Classification System
NASWA National Association of State
Workforce Agencies
NFJP National Farmworker Jobs Program
NIST National Institute of Standards and
Technology
NPRM Notice of Proposed Rulemaking
MIS Management Information System
OCTAE Office of Career, Technical, and
Adult Education
OJT On-the-job training
OMB Office of Management and Budget
ORR Office of Refugee Resettlement
PII Personally identifiable information
PIRL Participant Individual Record Layout
POP Period of Participation
PRA Paperwork Reduction Act of 1995
PY Program Year
RFA Regulatory Flexibility Act
RFP Request for Proposals
RHY Runaway and Homeless Youth
RIA Regulatory Impact Analysis
RSA Rehabilitation Services Administration
SBA Small Business Administration
SBREFA Small Business Regulatory
Enforcement Fairness Act of 1996
SCSEP Senior Community Service
Employment Program
sec. Section of a Public Law or the United
States Code
SLDS Statewide Longitudinal Data System
SNAP Supplemental Nutrition Assistance
Program
SRC State Rehabilitation Council
SSA Social Security Administration
SSN Social Security Number
SWA State Workforce Agencies
TAA Trade Adjustment Assistance
TAG Technical Assistance Guide
TANF Temporary Assistance for Needy
Families
TDD Telecommunications Device for the
Deaf
TEGL Training and Employment Guidance
Letter
UI Unemployment insurance
U. S. C. United States Code
VETS Veterans' Employment and Training
Service
VEVRAA Vietnam Era Veterans'
Readjustment Assistance Act
VR Vocational rehabilitation
WDB Workforce Development Board
WIA Workforce Investment Act of 1998
WIOA Workforce Innovation and
Opportunity Act
WISPR Workforce Investment Streamlined
Performance Reporting
WRIS Wage Record Interchange System
III. Public Comments Received on the
Notice of Proposed Rulemaking
The Departments published five
NPRMs related to WIOA on April 16,
2015. The first NPRM is the Joint Rule
for Unified and Combined State Plans,
Performance Accountability, and the
One -Stop System Joint Provisions (80
FR 20574) ( hereinafter " the Joint WIOA
NPRM"); the second NPRM is the
Workforce Innovation and Opportunity
Act (80 FR 20690); the third NPRM is
the Programs and Activities Authorized
by the Adult Education and Family
Literacy Act (Title II of the Workforce
Innovation and Opportunity Act) (80 FR
20668); the fourth is the State
Vocational Rehabilitation Services
program; State Supported Employment
Services program; Limitations on Use of
Subminimum Wage ( 80 FR 21059); and
the fifth is the Workforce Innovation
and Opportunity Act, Miscellaneous
Program Changes ( 80 FR 20688).
During the 60 -day public comment
period, the Departments received a total
of 546 public comments on the Joint
WIOA NPRM. In addition to these
comments, the Departments also
considered relevant public comments
on the DOL and ED program -specific
NPRMs.
General Comments
Comments: The Departments received
many comments supporting these
regulations. For example, the
Departments received comments
supporting cross -program data and
performance measurement, the
increased focus on adult education and
services to immigrants, improved
alignment between Federal initiatives
and State and local needs, increased
matching of apprenticeships with
employers, as well as support for other
provisions discussed in the section -by -
section analysis below. Additionally,
the Departments received comments
commending the collaboration on joint
regulations and encouraging additional
coordinated guidance. Also, several
commenters expressed support for the
enactment of WIOA, noting the law will
decrease unemployment, make the
United States more competitive, lead to
higher wages, and facilitate entry into
the middle class.
A few commenters generally opposed
the rulemaking, in part because they
disagreed with the role WIOA assigns to
the Federal government concerning
covered programs. Others suggested that
the NPRM itself was excessive, overly
cumbersome, and not understandable to
the layperson, needed clarification, and
was inconsistent with the plain and
simple language of WIOA.
Departments' Response: The
Departments acknowledge these
comments, but do not address them
further in the Final Rule since they do
not request specific changes to the
regulatory text. However, the
Departments note that the section -by -
section analysis is drafted to provide
additional clarity on complicated
provisions, such as those related to the
definitions used in the performance
accountability regulations, requirements
for the State funding mechanism for the
one-stop system, and requirements for
Unified and Combined State Plan
modifications. Furthermore, revisions
were made to various sections in the
regulatory text to improve readability.
Additionally, the Departments will
continue to provide guidance and
technical assistance, as needed, to assist
States in implementing WIOA.
Accessibility of the Public Workforce
System to Individuals With Disabilities
Comments: The Departments received
many comments related to increased
access to workforce services for
individuals with disabilities, both in
support of legislative changes and
expressing concern that the regulations
need to hold the public workforce
system fully accountable to implement
such changes. Several commenters
noted that, under WIOA, individuals
with disabilities will have greater access
to workforce training programs and be
able to take advantage of the benefits
resulting from their training. However,
one commenter asserted that the rule
must do more to consider the unique
needs of individuals with disabilities,
who may take longer than others to
achieve employment. Another
commenter expressed concern that her
organization would not have enough
resources to provide pre-employment
transition services to potentially eligible
students with disabilities. A commenter
encouraged efforts to improve the ability
of the one-stop system to serve
customers with disabilities through
existing services and programs, and
another urged the Departments to
include specific requirements for
training and access to text -to -speech and
speech -to -text technologies for people
with dyslexia and print disabilities.
Departments' Response: WIOA
includes numerous provisions intended
to increase employment opportunities
for individuals with disabilities, and
these regulations reinforce those
statutory provisions. There are
numerous discussions throughout part
678 reiterating the Departments' intent
to ensure access to needed employment
and training services to all individuals.
The Department has published a Final
Rule to implement sec. 188 of WIOA,
which prohibits discrimination against
WIOA participants, by making technical
changes only to its existing regulation
implementing WIA (i.e., ( 1) replicating
at part 38 the rule from part 37, and ( 2)
replacing references to the " Workforce
Investment Act of 1998" or " WIA" with
Workforce Innovation and Opportunity
Act" or " WIOA" to reflect the proper
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statutory authority). See 80 FR 43, 871
July 23, 2015).
In addition, on January 26, 2016, DOL
proposed updating these regulations to
better align with the Americans with
Disabilities Act Amendments Act of
2008, Public Law 110-325, sec. 2( b)( 1),
122 Stat. 3553 ( 2008) and the relevant
implementing regulations and guidance
issued by the Department of Justice ( 28
CFR parts 35 and 36), as well as the final
regulations and guidance issued by the
Equal Employment Opportunity
Commission (29 CFR part 1630, 76 FR
16978 (Mar. 25, 2011) (Equal
Employment Opportunity Commission
regulations implementing Americans
with Disabilities Act title I)). See 81 FR
4493 ( January 26, 2016). The proposed
WIOA sec. 188 rule would ensure that
the definition of " disability" is
consistent with the Americans with
Disabilities Act Amendments Act and
current case law, which will enable
more individuals with disabilities to be
effectively served within the public
workforce system. That NPRM also
addresses accessibility requirements
such as those for information and
electronic technologies) and service
animals. The Departments encourage
commenters to review carefully the
provisions of part 678 in this Joint
WIOA Final Rule, as well as the
proposed WIOA sec. 188 rule.
With respect to the commenter' s
concerns about pre-employment
transition services, the Departments
acknowledge that the provision of these
services is a new requirement imposed
on the VR program under sec. 113 of the
Rehabilitation Act of 1973, as amended
by title IV of WIOA. States must reserve
at least 15 percent of their VR allotment
to provide these services to students
with disabilities. The ED provides
detailed discussions regarding this
requirement in the VR program -specific
final regulations published elsewhere in
this issue of the Federal Register.
Requests To Extend the Comment
Period
Comments: A few commenters
requested a 60 -day extension of the
comment period. The commenters cited
the size and complexity of the five
proposed NPRMs implementing WIOA.
Departments' Response: While the
Departments recognize that the issues
addressed in the NPRM are complex
and important, the Departments
concluded that the 60 -day comment
period was sufficient to provide the
public a meaningful opportunity to
comment, and this conclusion is
supported by the hundreds of complex
and thoughtful comments received.
Additionally, the NPRM was available
to the public for a preliminary review
on the Federal Register Web site upon
submission of the NPRMs to the Federal
Register, which was several weeks prior
to publication, thereby providing
stakeholders additional time prior to the
publication date.
Conclusion
These final regulations provide the
critical framework for the
implementation of WIOA. However,
achieving the goals of WIOA will take
visionary leadership and coordination at
the State, regional, and local levels, and
partnerships across many programs. It
will require investment and innovation
to develop new information technology
that supports this important work, and
make the most of this investment of
public funds. The Departments will
support these activities through program
funding, on-going technical assistance
and the provision of guidance to all
levels of the American Job Center
system.
IV. Section -by -Section Discussion of
Public Comments and the Final Joint
Regulations
A. Unified and Combined State Plans
Under Title I of the Workforce
Innovation and Opportunity Act (20
CFR Part 676; 34 CFR Part 361, Subpart
D; 34 CFR Part 463, Subpart H)
WIOA requires the Governor of each
State to submit a Unified or Combined
State Plan to the Secretary of Labor that
outlines a 4 -year strategy for the State' s
workforce development system. States
must have approved State Plans in place
to receive funding for the six core
programs under WIOA—the adult,
dislocated worker, and youth programs
WIOA title I); the AEFLA program
WIOA title II); the Employment Service
program authorized under the Wagner-
Peyser Act, as amended by WIOA title
III (Wagner-Peyser Act Employment
Service); and the VR program
authorized under title I of the
Rehabilitation Act of 1973, as amended
by WIOA title IV (VR program). States
must submit, at a minimum, a Unified
State Plan, which encompasses the six
core programs under WIOA. However,
States are encouraged to submit a
Combined State Plan, which must
include the six core programs of the
Unified State Plan, plus one or more
Combined State Plan partner programs,
as described at § 676. 140( d): ( 1) Career
and Technical Education (CTE)
programs authorized under the Carl D.
Perkins Career and Technical Education
Act of 2006 ( 20 U.S. C. 2301 et seq.); ( 2)
TANF, authorized under part A of title
IV of the Social Security Act (42 U. S. C.
601 et seq.); ( 3) Employment and
training programs authorized under sec.
6( d)( 4) of the Food and Nutrition Act of
2008 ( 7 U. S. C. 2015( d)(4)); ( 4) Work
programs authorized under sec. 6( o) of
the Food and Nutrition Act of 2008 ( 7
U.S.C. 2015(o)); ( 5) Trade adjustment
assistance activities under chapter 2 of
title II of the Trade Act of 1974 ( 19
U.S. C. 2271 et seq.); ( 6) Services for
veterans authorized under chapter 41 of
title 38 United States Code; ( 7) Programs
authorized under State unemployment
compensation laws (in accordance with
applicable Federal law); (8) Senior
Community Service Employment
Programs under title V of the Older
Americans Act of 1965 ( 42 U.S. C. 3056
et seq.); ( 9) Employment and training
activities carried out by HUD; (10)
Employment and training activities
carried out under the Community
Services Block Grant Act (CSBG) ( 42
U.S. C. 9901 et seq.); and (11)
Reintegration of offenders programs
authorized under sec. 212 of the Second
Chance Act of 2007 ( 42 U.S. C. 17532).
When a State elects this option, the
Combined State Plan will take the place
of the Unified State Plan for that State.
Coordination across multiple Federal
programs provides a wider range of
coordinated and streamlined services to
the customer.
This part describes the submission
process and content requirements for
the Unified and Combined State Plans
under WIOA. The major content areas of
the Unified or Combined State Plan
include strategic and operational
planning elements. Strategic planning
elements include State analyses of
economic and workforce factors, an
assessment of workforce development
activities, formulation of the State' s
vision and goals for preparing an
educated and skilled workforce that
meets the needs of employers, and a
strategy to achieve the vision and goals.
Operational planning elements include
State strategy implementation, State
operating systems and policies,
program -specific requirements,
assurances, and additional requirements
imposed by the Secretaries of Labor and
Education, or other Secretaries, as
appropriate.
State WDBs are responsible for the
development, implementation, and
modification of the plan, and for
convening all relevant programs,
partners, and stakeholders. The
Governor must ensure that the Unified
or Combined State Plan is developed in
a transparent manner and in
consultation with representatives of
Local WDBs and chief elected officials
CEOs), businesses, representatives of
labor organizations, community-based
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organizations (CBOs), adult education
providers, institutions of higher
education, other stakeholders with an
interest in the services provided by the
six core programs, and any Combined
plan partner program included in a
Combined Plan, as well as the general
public, including individuals with
disabilities. Other stakeholders include,
but are not limited to, youth education
and workforce development providers,
disability advocates and service entities,
youth -serving programs, and other
advocacy organizations relevant to the
programs covered by the Unified or
Combined State Plan.
As noted in the NPRM, the
Departments have chosen not to include
all of the specific planning elements in
the regulation. Instead, comprehensive
State Plan requirements for both Unified
and Combined State Plans are detailed
in the WIOA Unified and Combined
State Plan and Plan Modifications ICR,
entitled " Required Elements for
Submission of the Unified or Combined
State Plan and Plan Modifications
under the Workforce Innovation and
Opportunity Act," under the OMB
Collection Number 1205-0522 ( hereafter
WIOA State Plan ICR"). ICRs must be
renewed every 3 years. In future years,
the WIOA State Plan ICR may undergo
revisions. Throughout this preamble,
WIOA State Plan ICR" refers to the
WIOA State Plan ICR as published on
February 19, 2016. The WIOA State Plan
ICR went through two rounds of public
comment before being finalized and
future revisions will be subject to public
comment as well, as required under the
PRA. In addition, the Departments
jointly have issued guidance explaining
the mechanics of how a State must
submit its State Plan, through TEGL No.
14- 15, Policy Directive RSA– PD- 16-03,
and Program Memorandum 16-1, all
entitled Workforce Innovation and
Opportunity Act (WIOA) Requirements
for Unified and Combined State Plans,
which were issued in March 2016.
States must use the WIOA State Plan
ICR to develop and submit the WIOA
Unified or Combined State Plan and in
accordance with instructions described
in the jointly issued State Plan
guidance.
In the section -by -section discussions
of each Unified and Combined State
Plan provision below, the heading
references the DOL CFR part and section
number. However, ED has identical
provisions at 34 CFR part 361, subpart
D ( under its State VR program
regulations) and at 34 CFR part 463,
subpart H (under a new CFR part for
AEFLA regulations). For purposes of
brevity, the section -by -section
discussions for each Department' s
provisions appear only once— in
conjunction with the DOL section
number—and constitute the
Departments' collective explanation and
rationale for each provision. When the
regulations are published in the CFR,
these joint performance regulations will
appear in each of the CFR parts
identified above.
Section 676. 100 What are the purposes
of the Unified and Combined State
Plans?
Section 676. 100 describes the
principal purposes of the Unified and
Combined State Plans, which
communicate the State' s vision for the
State public workforce system and serve
as vehicles for developing, aligning, and
integrating the State public workforce
system across Federal programs. Section
676.100(b) explains how the strategies
articulated in the plan support the
State' s vision and overarching goals.
The goals of the 4 -year Unified and
Combined State Plans are to align and
integrate Federal education,
employment, and training programs;
direct investments to ensure that
training and services are meeting the
needs of employers and job seekers;
apply consistent job -driven training
strategies across all relevant Federal
programs; and engage economic,
education, and workforce partners in
improving the workforce development
system. The Departments received a few
comments on this section, none of
which necessitated substantive changes
to the regulatory text. Section 676. 100,
as discussed below, remains unchanged
from the NPRM except for minor
technical edits.
Comments: Several commenters
supported the Departments' stated
purpose of the Unified and Combined
State Plans. A commenter said the
regulation should require that State
WDBs be provided with regular (e.g.,
quarterly) program information and
data, and at least annual analysis of the
State' s progress toward State Plan goals.
Departments' Response: The
Departments considered these
comments and concur that regular
receipt and review of program
information, data, and analysis will
better enable effective decision-making
by the State WDB. Section 677. 160 of
the joint performance regulations
requires States to report data annually
for all six core programs; however, some
programs will report data quarterly,
specifically the WIOA title I programs,
the Wagner-Peyser Act Employment
Service program, and the VR program,
in accordance with part 677 of this Joint
WIOA Final Rule. The State' s quarterly
and annual reports are publicly
available, and State and Local WDBs are
encouraged to review this information
regularly. Therefore, the Departments
have concluded that it is unnecessary to
amend the final regulations to require
that data be provided to the WDBs
regularly as the commenter
recommended.
Comments: A commenter requested
confirmation that the references to
relevant" and " job -driven" education
and training, in proposed
676. 100(b)( 2) and (3), refer to
evidence -based" strategies identified
in the Job -Driven Checklist (from Vice
President Biden' s report " Ready to
Work: Job -Driven Training and
American Opportunity" and the study
of " What Works in Job Training: A
Synthesis of Evidence"). The
commenter urged the Departments to
provide clarification on how to, and
encourage States to, use the joint State
planning process to ensure that these
evidence -based strategies are
incorporated into their newly energized
workforce development systems.
Departments' Response: The
Departments agree that evidence-based
strategies are important for the strategic
planning required by this section.
Paragraph (b)( 2) of § 676. 100 requires, as
part of the description of the purpose of
the Unified and Combined State Plans,
that the plans direct investments to
economic, education, and workforce
training programs that focus on
providing relevant education and
training. Section 676. 100(b)( 3) further
requires that plans apply strategies for
job -driven training consistently across
Federal programs. The references to
relevant" and " job -driven" education
and training, in § 676.100(b)(2) and (3),
include the " evidence -based" strategies
identified in the Job -Driven Checklist
from Vice President Biden' s report
Ready to Work: Job -Driven Training
and American Opportunity" and the
study of " What Works in Job Training:
A Synthesis of Evidence." Through the
issuance of joint Departmental guidance
and instructions, the Departments
offered further clarification and
encouragement to States regarding how
the joint planning process can ensure
that evidence -based strategies are
incorporated throughout the workforce
development system, including the
priorities of the job -driven checklist. No
change to the regulatory text was made
in response to this comment.
Section 676. 105 What are the general
requirements for the Unified State Plan?
Section 676. 105 describes the general
requirements for the Unified State Plan
that apply to all six core programs.
These requirements set the foundation
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for WIOA implementation by fostering
strategic alignment, improving service
integration, and ensuring that the public
workforce system is industry -relevant,
responds to the economic needs of the
State, and matches employers with
skilled workers. The Departments
envision a plan that describes how the
State will develop and implement a
unified, integrated workforce
development system rather than a plan
that discusses the State' s approach to
operating each core program
individually.
Section 676. 105( a) explains that
Unified State Plans must be submitted
in accordance with § 676. 130 and sec.
102( c) of WIOA as explained in joint
planning guidelines issued by the
Secretaries of Labor and Education, with
instructions to States on how to submit
Unified State Plans.
Section 676. 105( b) implements
WIOA' s statutory requirements in sec.
102( a), and requires that the State
submit the Unified State Plan to the
Secretary of Labor to receive funding for
the workforce development system' s six
core programs. The Departments made
an editorial change under § 676. 105( b)
to clarify that at a minimum States must
satisfy the requirements of a Unified
State Plan to be eligible to receive
funding for the workforce development
system' s six core programs. However, if
a State submits a Combined State Plan
then it will, by including all the
requirements of a Unified State Plan as
mandated by the regulation, also satisfy
the requirements of a Unified State Plan.
WIOA sec. 103( b)( 1) and § 676. 140( e)( 1)
of this regulation state that a Combined
State Plan must include all of the
requirements of a Unified State Plan.
Therefore, if a State submits a complete
Combined State Plan, it also will satisfy
all the requirements of a Unified State
Plan.
Section 676. 105( c) requires, in
accordance with sec. 102( a) of WIOA,
that the State outline its 4 -year strategy
for WIOA' s core programs and meet the
requirements of WIOA sec. 102( b).
Paragraph (c) of §676.105 remains
unchanged from that proposed in the
NPRM.
Section 676. 105( d), which
implements sec. 102( b) of WIOA,
describes the strategic and operational
planning elements that must be
included in the Unified State Plan. The
final regulation, consistent with that
proposed in the NPRM, concerns major
structural elements rather than
enumerating all the statutory State
planning requirements. States still must
comply with each of the statutory
requirements, regardless of whether
they are repeated in regulation. In
addition to minor technical edits
throughout, the Departments made two
substantive changes to § 676. 105( d)( 3).
First, in § 676.105(d)(3)( iv), the
Departments specifically mention the
assurance that the lead State agencies
responsible for administering the core
programs reviewed and commented on
the appropriate operational planning of
the Unified State Plan and approved
those elements as serving the needs of
the individuals served by the programs.
Second, the Departments added a new
paragraph (d)( 3)( v) that requires the
Unified State Plan to include a
description of the joint planning and
coordination across the core programs
and other required one-stop partners
and other programs in the workforce
development system. While these
provisions are new in these final
regulations, they do not represent new
requirements on the States because each
of these requirements are contained in
sec. 102(b) of WIOA and were
applicable to the States regardless of
whether they were mentioned in the
NPRM.
In these final regulations, the
Departments have added § 676. 105( e) to
make clear that all of the requirements
of part 676 ( which implements the
Unified or Combined State Plan
requirements of secs. 102 and 103 of
WIOA) apply to the outlying areas. As
a result, the outlying areas must submit
a Unified or Combined State Plan to
receive funding for all of the core
programs. This regulatory change is
discussed at greater length below.
Outlying Areas
Comments: The Departments received
several comments related to the
applicability of Unified or Combined
State Plan requirements to outlying
areas. In the NPRM, the Departments
sought comments specifically related to
this issue and provided two options:
Either (1) require outlying areas to
submit Unified or Combined State Plans
or ( 2) exempt outlying areas from the
Unified or Combined State Plan
requirement as a prerequisite for
receiving funds for core programs. The
commenters were unanimous in their
support of explicitly requiring outlying
areas to submit Unified or Combined
State Plans as a prerequisite for
receiving funding for all core programs.
In so doing, these commenters said this
approach would ensure consistency and
a unified planning process, increase the
relevance and validity of national
program comparisons, and contribute to
a fair and equitable distribution of
funds. These commenters also noted
that this approach would avoid the
concern that outlying areas would
submit Unified or Combined State Plans
that include only the adult education
and VR programs, since titles II and IV
of WIOA require the submission of such
plans as a prerequisite to receive
funding.
While supporting the approach that
would require outlying areas to submit
a Unified or Combined State Plan as a
prerequisite to receive funding for all
core programs, one commenter
expressed concern that ED permits
outlying areas to receive adult education
program funds under title II through the
Consolidated Grant to Insular Areas
application process (Consolidated Grant
process). The commenter recommended
that if ED continues to permit the award
of adult education funds through the
Consolidated Grant process, the
Departments should require that
outlying areas choosing to go through
the Consolidated Grant process include
title II activities as part of the planning
process for the Unified or Combined
State Plan, even though their funding is
awarded through the Consolidated
Grant.
Another commenter expressed
concern that, if the outlying areas were
not required to submit Unified or
Combined State Plans for all core
programs, a situation could exist in
which the VR program would be the
only component of such a plan if any of
the outlying areas opted to include adult
education program funds in its
Consolidated Grant application process.
The commenter suggested that, in such
a situation, the Departments should
ensure that outlying areas are not
penalized and denied funding for the
VR program, which is one of the six core
programs under WIOA.
Other commenters expressed general
support for requiring outlying areas to
submit Unified or Combined State
Plans, and one commenter noted that
the inconsistency in the definitions of
State" and " outlying areas" in WIOA
raised questions as to congressional
intent on the issue of whether the
Unified or Combined State Plan
requirements should be applicable to
the outlying areas. A commenter
suggested, if the intent of differing
definitions was to treat outlying areas
differently than States, a more
comprehensive delineation should be
provided. In particular, the delineation
should specify more than just a
competitive process" for the title I
programs since outlying areas have
historically received funding for these
programs on a formula basis. The
commenter suggested that the
requirement for competitions is
inconsistent with the need for a Unified
or Combined State Plan because, under
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a competition, funds would come into
question every year. The commenter
further suggested that if outlying areas
are not going to be treated differently for
purposes of the State planning
requirements, a reconciliation of terms
should be provided by Congress,
thereby eliminating all ambiguity and
restoring formula funding for the
outlying areas through submission of a
Unified or Combined State Plan.
Departments' Response: The
Departments agree that applying the
Unified or Combined State Plan
requirements to the outlying areas is
most consistent with the vision under
WIOA for all six core programs to
provide an integrated and coordinated
workforce development system.
The Departments want to make clear
that the State Plan requirements in
WIOA secs. 102 and 103 apply to
outlying areas, not just to States. To that
end, the Departments have added
clarifying language in § 676. 105( e) of
these final regulations. The Departments
have concluded that requiring the
outlying areas to submit Unified or
Combined State Plans that incorporate
all of the core programs as a prerequisite
to receive funding under any of the core
programs is most consistent with the
plain meaning of WIOA' s planning and
allocation of funds requirements when
both are read together. Further, it is the
only interpretation that gives full
meaning to the unified strategic
planning required across all core
programs.
In resolving the apparent
inconsistency and potential for
confusion regarding the definitions of
State" and " outlying area," as it was
explained in the NPRM preamble, the
Final Rule relies on the Secretary of
Labor' s general authority to regulate at
sec. 189 of WIOA, and applicable
provisions of titles II and IV of WIOA.
In so doing, the Departments ensure that
all core programs— and all grantees
under each of those programs— are
treated similarly, thereby achieving the
vision of WIOA as an integrated and
coordinated one-stop delivery system
and a unified, strategic planning process
encompassing all core programs.
The Departments also agree with the
commenter that the option, which has
existed for ED, for outlying areas to
include the adult education program as
part of a Consolidated Grant
application, raises some unique
concerns with regard to the Unified or
Combined State Plan requirements of
WIOA. When an outlying area submits
a Consolidated Grant application,
pursuant to 48 U.S. C. 1469a, the
application is submitted in lieu of any
other State Plan required by any of the
programs included in the Consolidated
Grant application. The Departments
have considered the suggestion made by
the commenter; however, resolution of
this particular concern goes beyond the
scope of these joint regulations. The ED
will take the recommendation under
advisement and will address this issue
more fully in its administration of the
Consolidated Grant to Insular Areas.
The Departments recognize that this
interpretation raises additional
questions with regard to the competition
provisions that apply to the title I core
programs in WIOA sec. 127(b)( 1)( B).
The DOL will address this issue in
guidance.
Joint Planning Guidelines
Comments: Proposed § 676. 105( a) is,
in the NPRM, the first mention of joint
planning guidelines to be issued by the
Secretaries of Labor and Education. A
number of commenters questioned
whether the joint guidelines would be
subject to public comment, and a few
commenters challenged whether, in
issuing the joint guidelines, the
Departments would be in compliance
with the Administrative Procedures Act
APA).
Departments' Response: The
Departments' joint planning guidelines,
issued March 2016, complied with the
APA. The APA does not require notice
and comment for interpretative rules,
general statements of policy, or rules of
agency organization, procedure, or
practice. See 5 U. S. C. 553( b)( A). The
planning guidance falls under these
exceptions, and thus, was not subject to
notice and comment rulemaking.
Specifically, the guidance includes
procedural rules explaining the
mechanics of how a State must submit
its State Plan, as well as interpretive
rules as needed to explain the
applicable statutory and regulatory
requirement.
Comments: One commenter
supported the inclusion of adult
education as a core program in the
Unified State Plan in § 676.105(b)( 2), as
well as the requirement that those who
administer adult education programs be
represented on State and Local WDBs.
Multiple commenters asserted that any
grant programs under the jurisdiction of
DOL ETA and operated through the
State Workforce Agency (SWA) or the
one-stop delivery system should be
required to be part of the State' s Unified
or Combined plan. As an example, the
commenters said there should not he a
separate planning process for the Jobs
for Veterans' State Grant (JVSG) or
Foreign Labor Certification. Another
commenter said non-WIOA core
program partners should be allowed to
participate in the strategic portion of the
planning process, even if they cannot
fully align their program budgets and
operational plans with a 2-or 4 -year
operational plan.
Departments' Response: The
Departments acknowledge the
commenter' s support for inclusion of
those who administer adult education
programs on the State and Local WDBs
in the regulation as proposed. State and
Local WDB requirements, and related
comments, are discussed in sections of
the DOL WIOA Final Rule preamble,
which is published elsewhere in this
issue of the Federal Register (see 20
CFR 679. 110( b)( 3)( iii)(A) and
679. 320( d)).
Regarding comments in support of
including additional programs in the
Unified State Plan, sec. 102( a) of WIOA
and § 676. 105( b) make clear that only
the core programs (as defined in sec.
3( 12) and ( 13) of WIOA) are to be
included in such plan. Paragraph (b) of
676. 105 is consistent with the six core
programs identified throughout WIOA.
States may submit a Combined State
Plan that could include the programs
mentioned by commenters. If a State
chooses to submit a Combined State
Plan, the plan must include the six core
programs and one or more of the
Combined State Plan partner programs
and activities described in sec. 103( a)( 2)
of WIOA, and § 676. 140( d). The JVSG is
a Combined State Plan partner program
which States may include in a
Combined State Plan as described under
WIOA sec. 103 and § 676. 140( d).
Foreign Labor Certification is not a
Combined Plan partner program under
WIOA sec. 103; however, a State may
include a description of Foreign Labor
Certification in its State Plan among its
description of other programs and
activities.
Regarding the inclusion of non-WIOA
core program partners in the strategic
portion of the planning process, WIOA
sec. 102( b)( 2) requires State Plans to
discuss alignment among core programs
and the employment and training
services within education and human
services programs which operate in
partnership with the one-stop delivery
system, including those not authorized
by WIOA. Although not described in the
regulation for State Plans, this
requirement is reflected in the WIOA
State Plan ICR. The Departments agree
that coordination with program partners
and stakeholders to the fullest extent
possible is vital for successful joint
planning. In addition to the changes
made to § 676. 105( d)( 3) as described
above and relevant to these comments,
the Departments revised § 676. 140
regarding Combined State Plans, which
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will be discussed in more detail below
in connection with that section. Further
comments regarding the importance of
public comment, review, input and
coordination in development of the plan
are discussed in this preamble in
676. 130( c) and (d)( 1) for Unified State
Plans and under §§ 676. 140( e)( 4) and
676.143( b) and (c) for Combined State
Plans.
Comments: A couple of commenters
responded to the authority granted to
the Secretaries by WIOA sec. 102(b)( 2)
to create additional operational
planning requirements beyond those
already detailed in statutory language.
These commenters requested that the
Secretaries, in their discretion, keep to
a minimum any additional planning
requirements to reduce the burden
placed on States and to provide States
with ample opportunity to comply with
statutorily established planning
elements.
Departments' Response: The
Departments have considered these
comments and agree. WIOA contains a
detailed description of planning
requirements, and the Departments have
chosen not to include all of the specific
planning elements in the regulation.
However, as made clear in the NPRM
and this preamble, States must comply
with all State planning requirements set
forth in WIOA regardless of whether the
requirements are repeated in these
regulations. Comprehensive State Plan
requirements for both Unified and
Combined State Plans are detailed
through the WIOA State Plan ICR. The
Departments have endeavored to keep
additional planning requirements to a
minimum, while also attempting to
ensure that the WIOA reform principles
of program integration and alignment,
job -driven training, accountability and
transparency are reflected in the State
Plans.
Comments: The Departments received
a number of comments that requested
plan requirements be added. In response
to these suggestions, described in more
detail below, the Departments have
made no change to the regulatory text
but have indicated whether the
particular suggested requirements are
indeed already included in the
applicable WIOA State Plan ICR,
published on February 19, 2016. In
future years, the WIOA State Plan ICR
may undergo revisions. The level of
detail of the plan requirements
suggested by the following comments is
more appropriately addressed in the
WIOA State Plan ICR than in the
regulatory text. The Departments have
declined to incorporate the following
suggested changes in the regulatory text,
but the discussion of the following
comments points to various provisions
of the WIOA State Plan ICR and other
places in the regulation that are
pertinent to the commenters' concerns.
Some commenters asserted that the
regulation should require that States
address priority of service for covered
veterans, and for those veterans with
service connected and non -service -
connected (condition not as a result of
military service) disabilities.
Departments' Response: The
Departments have reviewed these
comments. The WIOA State Plan ICR
requires that States describe in their
Unified or Combined State Plans how
they will implement and monitor the
priority of service provisions for all
veterans in accordance with the
requirements of 38 U.S. C. 4215. This
provision applies to all employment and
training programs funded in whole or in
part by DOL. In addition, the WIOA
State Plan ICR requires States to explain
the referral process for veterans
determined to have a significant barrier
to employment, including certain
disabled veterans, to receive services
from the JVSG program.
Comments: One commenter said the
Departments should unify the definition
of " supportive services" across
programs, thereby aligning adult
education and literacy activities with
other core programs and with one-stop
partners. The commenter noted the
disparity between the definition of
supportive services" under sec. 3( 59)
of WIOA and the definition of " other
services" under career pathways
programs. The commenter concluded
that the quality and type of wraparound
services offered should not be
dependent on the program in which
individuals participate, and the
Departments should encourage States to
develop comprehensive wraparound
services that are available to adults,
youth, dislocated workers, and adult
education students whenever possible.
Departments' Response: WIOA sec.
3( 59) provides a definition of
supportive services;" this definition
applies to, and remains consistent
across, all core programs. The WIOA
State Plan ICR, which implements the
statutory and regulatory requirements
for Unified and Combined State Plans,
requires States to describe how the
entities carrying out the programs
involved in the Unified or Combined
State Plan including the core programs,
any applicable Combined State Plan
partner programs, and any mandatory
and optional one-stop partner programs,
will coordinate activities and resources
to provide comprehensive, high-quality,
customer -centered services. This
requirement includes the provision of
supportive services. However, the
determination of need for, and the
extent to which there is a need for,
supportive services is within the State
WDB' s discretion, consistent with each
of the individual program' s authorizing
statutes.
Comments: One commenter, in
response to § 676. 105( d)( 1), said the
Departments should ensure that
consistent data definitions and
comparable data are used to assess
respective labor market areas.
Departments' Response: The WIOA
State Plan ICR emphasizes the use of
economic analysis and labor market
information throughout and also
addresses alignment of labor market
information systems. The Departments
encourage States to use a variety of
accurate, reliable, and timely labor
market information on which to base
analyses in the State Plan. However,
consistent with WIOA, the Departments
will not require States to use a
particular dataset and will leave the
choice of data sources to the States'
discretion, thereby allowing each State
to meet its own unique needs and
circumstances.
Addressing the Needs of Individuals
With Barriers to Employment
Comments: A commenter suggested
that the Departments require States to
provide additional information
regarding how they will address the
needs of people with disabilities.
Another commenter stated that WIOA
requires that State and local planning
efforts be informed by an analysis of
various data, including data that include
the education and skill levels of
individuals with barriers to
employment. A commenter said it
would be helpful if the Departments
explicitly required that States determine
the number of individuals employed
under 14( c) special wage certificates as
part of the " analysis of the current
workforce, employment and
unemployment data, labor market
trends, and the educational and skill
levels of the workforce, including
individuals with barriers to employment
including individuals with disabilities),
in the State" pursuant to WIOA sec.
102(b)( 1)( B). This commenter also stated
that the strategic planning elements
obligate the State to examine the
specific employment related
characteristics in their State and that
this would be a valuable opportunity to
gather information on employment
statistics for individuals with
disabilities.
Departments' Response: Consistent
with WIOA and these final regulations,
multiple sections of the WIOA State
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Plan ICR require the State to address the
needs of individuals with barriers to
employment. The term " individual with
a barrier to employment," as defined in
sec. 3( 24) of WIOA, encompasses the
following groups of people: Individuals
with disabilities, including youth with
disabilities; displaced homemakers;
low-income individuals; Indians, Alaska
Natives, and Native Hawaiians; older
individuals; ex -offenders; homeless
individuals, or homeless children and
youths; youth who are in or have aged
out of the foster care system; individuals
who are English language learners,
individuals who have low levels of
literacy, and individuals facing
substantial cultural barriers;
farmworkers (as defined at sec. 167( i) of
WIOA and Training and Employment
Guidance Letter No. 35-14); individuals
within 2 years of exhausting lifetime
eligibility under the TANF program;
single parents ( including single
pregnant women); and long-term
unemployed individuals. Therefore,
States are required to address the needs
of individuals with disabilities in the
Unified or Combined State Plan.
Consistent with sec. 102( b)( 1)( B) of
WIOA and these final regulations, the
WIOA State Plan ICR requires that State
analysis related to individuals with
barriers to employment include
employment and unemployment, labor
market trends, education, and skill
levels of the workforce and any
apparent gaps between the skills in
demand by employers and the skill
levels of the workforce. State and local
planning efforts are informed by this
analysis. Based on this analysis of
workforce and labor market information
required under sec. 102( b)( 1)( B) of
WIOA, § 676. 105( d) and the WIOA State
Plan ICR require State Plans to describe
State' s strategic vision and goals for
developing its workforce and meeting
employer needs in order to support
economic growth and economic self-
sufficiency. To that end, the State must
describe its goals for preparing an
educated and skilled workforce,
including preparing youth and
individuals with barriers to employment
and other populations. Further, the
WIOA State Plan ICR requires the State
to assure that the State obtained input
into the development of the Unified or
Combined State Plan and provided an
opportunity for comment on the plan by
primary stakeholders, including
organizations that provide services to
individuals with barriers to employment
and that the Unified or Combined State
Plan is available and accessible to the
general public.
Additionally, the Departments agree
that the number of individuals
employed under 14( c) special wage
certificates may be helpful as part of the
analysis by the State of workforce needs.
However, the benefit of requiring the
collection of sufficient data elements to
satisfy the needs of every program must
be balanced with the burden such a
requirement would impose on State
program operators and participants. For
this reason, the Departments are not
regulating such a requirement. While
the collection of this data element will
not be required of States, comparable
data is publicly available. When an
employer applies for a sec. 14( c)
certificate from the Department of
Labor' s Wage and Hour Division, the
employer is required to report on their
application the number of workers with
disabilities they employed at
subminimum wages during their most
recently completed fiscal year. The
Department of Labor' s Wage and Hour
Division posts on its Web site (http://
www.dol.gov/ whd/
workerswithdisabilities/) lists of all
employers who hold sec. 14( c)
certificates and certain data elements
reported on their applications,
including the number of workers with
disabilities who were paid subminimum
wages.
Finally, the Departments agree that
the strategic planning elements
requirements present a valuable
opportunity to gather information on
employment statistics for individuals
with disabilities, so long as States are
mindful of Federal and State law
protecting personally identifiable
information (PII).
Comments: A couple of commenters
said States should be required to
include the following information in
their State Plans: ( 1) Explicit activities
focused on how they will work to
ensure " low-level learners" and hard -to -
serve populations are served by the
State Plan, and ( 2) a report on the
diversity of programs funded and the
actions taken to ensure broad
participation at the local level. A
commenter urged the Departments to
encourage States and localities to build
activities into their State Plans
specifically directed at raising
awareness about older workers and
dispelling stereotypes. This same
commenter also urged the Departments
to encourage States to create plans that
ensure engagement of all players to help
employers connect with older workers.
Departments' Response: The
Departments have reviewed these
comments. As noted above, States must
address in their Unified or Combined
State Plans the needs of " individuals
with barriers to employment," as
defined in sec. 3( 24) of WIOA, in the
State' s workforce analysis, goals for the
public workforce system and in the
State' s stakeholder input and public
comment assurances. As described
above, the term " individual with a
barrier to employment" includes
individuals who have low levels of
literacy and older workers. However,
the Governors and State WDBs will
determine the explicit activities
appropriate for their individual States.
For this reason, the Departments are not
requiring in these regulations specific
activities to satisfy these requirements,
though we acknowledge that some states
may elect to do so. In developing their
Unified or Combined State Plans, States
must conduct a thorough analysis of
labor market statistics, which will
address the needs of specific
populations. The Departments do not
have authority under WIOA to require a
report on the diversity of programs
funded and the actions taken to ensure
broad participation at the local level, as
recommended by commenters.
Comments: A few commenters
recommended that the Departments
encourage WDBs to establish effective
operational partnerships with
Continuum of Care bodies and State
councils focused on homelessness. A
couple of commenters also suggested
that the Departments encourage State
Plans to include specific strategies for
using employment to prevent and end
homelessness. One commenter provided
examples of specific strategies for using
employment to prevent and end
homelessness, including HUD support
for public housing residents,
individuals with housing vouchers, and
housing and community development
projects. Lastly, this same commenter
urged the Departments to work with
HUD and other national experts and
initiatives to identify and promote
promising examples of where and how
homeless services systems and
workforce systems are working together
for the benefit of increasing employment
and economic opportunity for job
seekers.
Departments' Response: The
Departments have reviewed these
comments. The Departments encourage
State and Local WDBs to partner with
appropriate entities to address the needs
and concerns of individuals who are
homeless or at risk of homelessness,
including Continuum of Care bodies,
State councils focused on homelessness,
and programs administered by HUD.
These are appropriate strategies for a
State Plan in States with significant
issues related to individuals who are
homeless or at -risk of homelessness. As
noted above, in developing its Unified
or Combined State Plan, the State must
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address the needs of individuals with
barriers to employment in the State' s
workforce analysis, goals for the public
workforce system and in the State' s
stakeholder input and public comment
assurances. An " individual with a
barrier to employment" in WIOA sec.
3( 24) includes homeless individuals.
Because each State' s needs and
circumstances are unique, the
Departments have not imposed the
additional planning requirements
suggested by commenters in these final
regulations. The Departments agree with
the commenter about the need for
increased collaboration at the Federal
level and, to that end, the Departments
have collaborated with other Federal
agencies, including HUD, in developing
the WIOA State Plan ICR and will
continue to do so to ensure full
implementation of WIOA.
Comments: A few commenters stated
that WIOA represents a substantial shift
from the WIA because it increases the
amount of title I youth funding
dedicated to out-of-school youth to 75
percent (up from the prior 30 percent
under WIA) and expands the age range
to include those between 16 and 24
years old. The commenters said
immigrants represent more than 1 in 10
youth in this age range nationwide. The
commenters urged the Departments to
explore ways to encourage States and
Local WDBs to review their program
design and recruitment strategies to
ensure that they are reaching and
effectively serving eligible immigrants
and youth in their communities who are
English language learners.
Departments' Response: Some
guidance has already been released by
DOL related to the change in the
percentage of youth program (title I)
formula dollars that must be spent on
out-of-school youth, (see TEGL No. 23-
14), and DOL plans to issue further
guidance and technical assistance
focused on strategies for complying with
this requirement. The Departments
agree that States should address their
strategies for serving out-of-school
youth in State Plans. The WIOA State
Plan ICR requires States to describe the
strategies the State will use to achieve
improved outcomes for out-of-school
youth as they are defined in WIOA sec.
129( a)( 1)( B), including how it will
leverage and align the core programs,
any Combined State Plan partner
programs included in this plan, required
and optional one-stop partner programs,
and any other resources available. In
developing their Unified or Combined
State Plans, States must address the
needs of individuals with barriers to
employment in their workforce analysis,
goals for the public workforce system
and in stakeholder input and public
comment assurances. Under WIOA sec.
3( 24), individuals with barriers to
employment include youth with
disabilities, homeless children and
youths, youth who are in or have aged
out of the foster care system, individuals
who are English language learners,
individuals who have low levels of
literacy, and individuals facing
substantial cultural barriers. In their
Unified or Combined State Plan, States
also must describe how the one-stop
delivery system will ensure that each
one-stop center is able to meet the needs
of English language learners. The
Departments encourage States with
eligible immigrants and youth in their
communities to revisit their program
design and strategies to ensure that they
are reaching and effectively serving
these populations.
Comments: A couple of commenters
recommended that the Departments
require that State Plans provide for
access for English language learners to
all title I -funded services. If any title I -
funded programs in a State or locality
are not explicitly expected to provide
access to English language learners, the
commenters continued, the Departments
should require that the State or locality
demonstrate how it is complying with
Federal anti -discrimination provisions
and providing equitable access to title I
services for English language learners.
Departments' Response: The
Departments have reviewed these
comments and agree that providing for
the needs of English language learners
through title I services, as well as other
services, should be a component of all
Unified and Combined State Plans. Sec.
102(b)(2)( C)(vii) of WIOA requires States
to describe how the one-stop delivery
system (including one-stop center
operators and the one-stop delivery
system partners) will comply with sec.
188 of WIOA. In addition, the WIOA
State Plan ICR requires States to
describe how the one-stop delivery
system (including one-stop center
operators and the one-stop delivery
system partners) will ensure that each
one-stop center is able to meet the needs
of English language learners, such as
through established procedures, staff
training, resources, and other materials.
The Departments agree with the
importance of ensuring that States
address the needs of the specific
populations mentioned by the
commenters. As noted above, States
must address, in developing their
Unified or Combined State Plans, the
needs of individuals with barriers to
employment in their workforce analysis,
goals for the public workforce system,
and in stakeholder input and public
comment assurances. It also should be
noted that WIOA grant recipients are
subject to all of the requirements of the
sec. 188 WIOA Nondiscrimination and
Equal Opportunity Regulations (29 CFR
part 38).
Suggestions for State Plan Requirements
Section 676. 105( d)( 3)( i) through (v)
lists the operational planning elements
that must be included in a Unified or
Combined State Plan. Section
676. 105( d)( 3)( ii) states that operational
planning elements must include State
operating systems, including data
systems, and policies that will support
the implementation of the State' s
strategy.
Comments: In response to these
requirements, a commenter requested
guidance on where to focus State efforts
in technology planning. Specifically the
commenter asked whether the State
strategic plan can describe a schedule
for developing a comprehensive
technology plan and how States should
prioritize investments in technology as
funds become available. Another
commenter requested guidance on the
Departments' expectations regarding the
States' development of a common intake
system among one-stop partners.
Departments' Response: The
Departments have considered these
comments and agree that additional
guidance regarding the operational
planning elements contained in a State
Plan is appropriate. The Departments
plan to issue joint planning and
operational guidance regarding the
technology planning and data systems
to be used for reporting and intake
systems. Further, States are encouraged
to utilize the Departments' available
technical assistance.
Comments: A commenter
recommended that the Departments
require States to include and address
the following five topics in their Unified
State Plan: ( 1) Priority of Service, ( 2)
Career Pathways, ( 3) Criteria for
Selecting Employers for Work -based
Training, (4) Youth Committees, and (5)
Measurable Skill Gains. The commenter
went on to detail how States should
address each of the enumerated topics
in the State Plans. Specifically, with
regard to Priority of Service, the
commenter recommended requiring that
Unified State Plans include a
description of how the Governor will
ensure priority of service for title I adult
career and training services for
recipients of public assistance,
individuals who are basic skills
deficient, and other low-income
individuals. Regarding career pathways,
the commenter said Unified State Plans
should be required to explain: How the
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WIOA definition of a career pathway
will be applied to the programs in their
State that align with industries in the
regional economy; how the State will
make accessible secondary and
postsecondary education; how the State
will include individual education and
career counseling services; how the
State will include integrated education
and training; how the State is organized
for acceleration; how the State will
make available high school equivalency
and at least one postsecondary
credential; and how the State will
promote career advancement. The
commenter also recommended that
Unified State Plans be required to
demonstrate how they will track career
pathway participants whose service
happens not within one particular
Federal program and funding stream,
but across these programs through co -
enrollment. In addition, this same
commenter urged the Departments to
require States to list the criteria they
will use for selecting employers as an
operational element of the Unified State
Plan, and to ensure that local plans in
their State similarly describe the criteria
they will use for selecting employers.
Regarding youth committees, the
commenter recommended that the
Departments require States to explain in
their State Plans the State -directed
format for local areas youth committee
elections. Lastly, to ensure the effective
implementation of the measurable skill
gains indicator, the commenter
recommended that Unified State Plans
be required to ensure that local plans
include: (1) A process describing how
they will use the measurable skill gains
indicator based on their service delivery
strategies across programs, and ( 2) a list
of the measurable skill gains that they
will be utilizing in the coming year.
Departments' Response: The
Departments considered this comment
but did not revise the regulatory text.
Many of the concerns are already
addressed by sec. 102 of WIOA, these
regulations, and the WIOA State Plan
ICR. The WIOA State Plan ICR,
consistent with sec. 134( c)( 3)( E) of
WIOA, requires States to address, in
developing their Unified or Combined
State Plans, priority in the delivery of
career and training services to
individuals who are low income, public
assistance recipients, or basic skills
deficient. With regard to the
commenter' s concern about career
pathways, the WIOA State Plan ICR,
consistent with secs. 101( d)( 3)( B) and
102(b)(2)( B)(ii) of WIOA, includes
requirements for the State to describe
both its sector and career pathways
strategy. Further comments regarding
career pathways are discussed in detail
below. With regard to the commenter' s
concerns about work -based training, the
WIOA State Plan ICR requires States to
address work -based learning approaches
as a part of adult, dislocated worker,
and youth activities under title I—B of
WIOA. However, the Departments
decline to require a specific policy on
employer criteria because the
description of the State' s approach will
provide sufficient information to the
Departments and stakeholders.
Regarding youth committees, WIOA
eliminates the requirement for Local
WDBs to establish a youth council;
however, the Local WDB may choose to
establish a standing youth committee, as
described at 20 CFR 681. 110 ( see DOL
WIOA Final Rule). States with Local
WDBs that have chosen to form standing
youth committees may describe this as
a part of the State' s operational planning
elements, which are required in the
WIOA State Plan ICR. However, the
Departments have declined to require
that States address standing youth
committees because the creation of
standing youth committees is
determined by Local WDBs and the
appropriateness of including such
committees in the State Plan will vary
from State to State. The DOL has issued
guidance on standing youth committees,
in TEGL No. 23-14 and in TEGL No. 8-
15. Lastly, measurable skill gains is a
required performance indicator under
WIOA and it is defined in part 677 of
this Joint WIOA Final Rule. That part
further defines the specific allowable
skill gains. The Departments addressed
the data collection necessary to
sufficiently measure skill gains and
identify other indicators in the WIOA
Joint Performance ICR. The Departments
also provided further guidance on this
particular issue. Therefore, the
Departments decline to revise the
regulatory text in response to the
concerns discussed above.
Comments: Some commenters said
the Departments should require the
States to include in their Unified or
Combined State Plans a demonstration
of how they will ensure that eligible
providers have direct and equitable
access to apply and compete for grants
or contracts.
Departments' Response: In response
to this concern, the Departments direct
the commenters to the WIOA State Plan
ICR, which requires States to describe,
with regard to the distribution of funds
for title II programs in particular, how
the eligible agency will ensure direct
and equitable access to all eligible
providers to apply and compete for
funds. This provision in the WIOA State
Plan ICR is consistent with sec. 231( c)
of WIOA requiring direct and equitable
access for all eligible providers under
title II. Further, the WIOA State Plan
ICR requires States to describe how the
eligible agency will ensure that it is
using the same grant or contract
announcement and application
procedure for all eligible providers. The
guidance sufficiently addresses the
commenters' concerns; no changes to
the regulatory text were made in
response to these comments.
Comments: One commenter remarked
that throughout the " Career Services"
section of the law, there are references
to the " assistance" provided by the one-
stop center or its contractor as it relates
to financial aid eligibility and filing for
unemployment compensation. Due to
the significant decline in resources, the
commenter requested that State Plans
address how statewide resources will be
utilized to ensure local areas have
enough staff to meet this demand,
including how the State will allocate
funding and merit staff.
Departments' Response: The
Departments have considered this
comment and concluded that adopting a
requirement such as that would result in
substantial burden to the States. The
purpose of WIOA is best served if the
States retain flexibility to determine the
best use of staff resources to deliver
workforce services in the State.
Industry and Sector Partnerships
Comments: Several commenters
recommended that the Departments
require States to describe in the Unified
State Plan how they will carry out the
requirements under WIOA sec.
101( d)( 3)( D) relating to the development
of industry or sector partnerships. One
of these commenters made several
recommendations with regard to
industry or sector partnerships. First,
require regional plans to clarify the
relationship between regional sector
initiatives and any industry or sector
partnerships in the regional planning
area. Second, establish a new subpart H
covering Industry or Sector Partnerships
that, at a minimum, (a) describes the
purposes of industry or sector
partnerships, (b) reiterates the required
partners for an industry or sector
partnership as set forth in WIOA, (c)
clarifies the role of Local WDBs in
industry and sector partnerships, (d)
identifies the ways in which States and
local areas can evaluate the
effectiveness of industry or sector
partnerships, and ( e) eliminates the
current references to industry or sector
partnerships in proposed § 678. 435,
which generally describes the business
services that must be provided through
the one-stop delivery system.
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Additionally, as noted in the portion of
the DOL WIOA NPRM preamble
addressing 20 CFR 675. 300, commenters
recommended that the Departments
define the terms " Industry and Sector
Partnership" and " Sector Strategy" and
suggested specific components to
include in such definitions.
Departments' Response: The WIOA
State Plan ICR requires States to
describe the strategies they will
implement, including industry or sector
partnerships related to in -demand
industry sectors and occupations and
career pathways, as required by WIOA
sec. 101( d)( 3)( B) and (D). It also requires
States to address industry sectors and
occupations throughout the analyses
required in the State Plan. Additionally,
WIOA sec. 3( 26) defines " industry or
sector partnership." Due to the changing
needs of the workforce and employers,
and in order to maximize States'
flexibility to develop strategies to
address these changing needs, the
Departments decline to change the
regulation to be more prescriptive
through changing the definition of
industry or sector partnership,"
defining the term " sector strategy," or
adding a new subpart H on industry or
sector partnerships. The Departments
have provided technical assistance on
sector strategies and plan to continue to
do so while also issuing further
guidance on industry and sector
partnerships. Lastly, regional planning
requirements are addressed in 20 CFR
679. 510 ( see DOL WIOA Final Rule
published elsewhere in this issue of the
Federal Register).
Comments: One commenter
recommended that special emphasis be
placed upon highlighting the
importance of credentialing within
industry and sector partnerships,
especially for new high-growth
industries. Specifically, the commenter
recommended the following: (1) Funds
be specifically allocated and used for
State and local credentialing efforts
within industry or sector partnerships,
2) DOL link credentialing to industry or
sector partnerships and amend the
proposed State Plan requirements to
require States to use explicit language to
clarify how they will integrate
credentialing into the development of
new industry or sector partnerships,
where applicable, and (3) States should
be required to explain their efforts to
find industry -driven credentials as part
of their Unified State Plans while
providing a list of those credentials to
DOL.
Departments' Response: The
Departments agree that credentialing as
a part of industry or sector partnerships
is important. The WIOA State Plan ICR
supports the inclusion of credentialing
and its role in sector and career
pathways strategies. Specifically, the
WIOA State Plan ICR, consistent with
sec. 102(b)( 2)( B)(vi) of WIOA, requires
States to describe how their strategies
will improve access to activities leading
to recognized postsecondary credentials,
including registered apprenticeship
certificates. The requirement in the
WIOA State Plan ICR further includes
credentials that are industry -recognized
certificates, licenses, or certifications,
and that are portable and stackable. The
WIOA State Plan ICR also requires
States to describe the strategies the State
will implement, including industry or
sector partnerships related to in -demand
industry sectors and occupations and
career pathways, as required by WIOA
sec. 101( d)( 3)( B) and (D). Such strategies
may include the use of credentials or
industry -recognized certificates. The
Departments have concluded that these
requirements adequately address the
States' use of credentials within
industry or sector partnerships. The
Departments have declined to require
States to use explicit language regarding
how they will integrate credentialing
and the State' s efforts to fund industry -
driven credentials, or to require that
States provide a list of those credentials
to the Departments to reduce planning
burdens on States. Lastly, funding
allocations for State credentialing efforts
are outside the authority of this rule.
Career Pathways
Comments: Several commenters were
pleased that WIOA sec. 3( 7) codifies a
definition of " career pathways" in
Federal law, but they expressed concern
that the rule includes little guidance on
how career pathways are to be
implemented. These commenters
recommended that the Departments
require States to describe how they will
carry out the requirements under WIOA
relating to the development of career
pathways.
Departments' Response: The
Departments considered the
commenters' support for the WIOA
definition of career pathways and the
recommendation that States be required
to describe how they will carry out the
development of career pathways in the
State Plan. Career pathways are
designed to serve a diverse group of
learners, including youth, dislocated
workers, veterans, individuals with
disabilities, individuals who have low
levels of literacy or English proficiency,
new immigrants, women, and
minorities. Career pathways programs
provide opportunities for more flexible
education and training, allow people to
earn industry -recognized credentials,
and support the attainment of
marketable skills that transfer into work
for all. The Departments are choosing
not to regulate further regarding the
implementation of career pathways in
order to promote maximum flexibility at
the State and local level, and the
Departments will continue to support
career pathways programs locally and
regionally through comprehensive
technical assistance.
Comments: A number of commenters
recommended that the rule clarify the
minimum requirements that a Local
WDB must satisfy in order to
demonstrate successful implementation
of career pathways.
A few commenters encouraged the
Departments to use a forthcoming
Career Pathways and Credentials
Toolkit to amplify and build awareness
of States' and localities' requirements
for career pathways under WIOA.
Another commenter encouraged the
Departments to expand the use of career
pathways, especially for racial
minorities and women, and to provide
support to States and localities as they
implement plans to improve career
pathways available locally and
regionally.
One commenter said the Departments
should offer more specific guidance for
operationalizing career pathways, such
as acceptable strategies for braiding
funding streams from titles I and II of
WIOA and ways to identify and improve
career pathways programs, with a
particular focus on how to integrate
wraparound services successfully into
career pathways programs.
One commenter provided the
following recommendations:
Unified State Plans should he
required to demonstrate how to track
career pathway participants whose
service happens across Federal program
and funding streams through co -
enrollment.
The required elements for the
Unified State Plan should specify the
need to identify co -enrolled participants
across the WIOA titles and in the CTE
and human service partner systems.
Unified State Plans should illustrate
roles for CTE partners in development
and implementation of career pathways,
including strategies for co -enrollment.
The Joint WIOA Final Rule should
provide guidance to title I and title II
providers on working with CTE in the
design and implementation of career
pathways, and should promote shared
decision-making.
Unified State Plans should be
required to address strategies for serving
TANF recipients through career
pathway programming, as part of the
plan' s description of how career
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pathway services will be provided to
adults, youth, and individuals with
barriers to employment.
Departments' Response: Consistent
with sec. 101( d)(3)( D) of WIOA, the
WIOA State Plan ICR includes
requirements for the State to describe
the career pathways strategies. The
WIOA State Plan ICR, consistent with
secs. 101( d) and 102( b)( 2) of WIOA, also
requires States to describe how such
activities will be aligned across the core
programs and Combined State Plan
partner programs included in the State
Plan and among the entities
administering the programs, including
using co -enrollment and other
strategies, as appropriate. States have
the option of including strategies that
address TANF recipients as well as the
option of including TANF as a
Combined State Plan partner program in
a Combined State Plan. Because career
pathways, co -enrollment, and TANF
recipients already are reflected in
guidance, the Departments decline to
regulate planning requirements
regarding career pathways further.
Regarding commenters' suggestions for
specific strategies around
implementation and requests for
guidance, the Departments agree that
additional guidance is necessary to
describe WIOA requirements for
incorporating career pathways into the
State' s strategies, although the
Departments have concluded that
additional regulatory text on career
pathways is not necessary. The
Departments are working in partnership
with other Federal agencies to provide
additional guidance on the
implementation of career pathways in
WIOA, and the Departments continue to
take steps to incorporate career
pathways approaches into a wide range
of program investments, evaluation and
research activities, and technical
assistance efforts.
Combined State Plan Partner Programs
Paragraph (d)( 2) of § 676.105
specifically requires that Unified State
Plans include strategies for aligning the
core programs with Combined State
Plan partner programs and other
resources to support the State' s vision
and goals ( WIOA sec. 102( b)( 1)).
Comments: A few commenters noted
that the term " optional programs" is not
used in WIOA sec. 102(b)( 1), but the
commenters also acknowledged that
from the context it is apparent that the
Departments intended to refer to the
programs described at sec. 103( a)( 2) and
proposed § 676.140(d). The commenters
supported this language, but they
encouraged the Departments to clarify
this intent explicitly by amending
proposed § 676. 105( d)(2) to include " as
described in § 676. 140( d)" after the
words " optional programs." One
commenter stated that while the use of
the term " optional programs" for other
workforce development programs is
understood to he in reference to the fact
that they are not required to be part of
Unified Plans, there is the danger that
the term could inadvertently send a
message about the value of these
programs. The commenter
recommended that guidance should
clarify that " optional" only refers to the
planning requirements and does not
imply that other programs beyond the
WIOA " core" programs are any less
essential to workforce development.
Departments' Response: The
Departments have reviewed these
comments and agree that the term
optional program" was unclear. The
term " optional," as used in the NPRM,
referred to the State' s option of
including these partner programs in a
Combined State Plan. The Departments
also agree that Combined State Plan
partner programs are a valuable part of
the workforce development system and
the Departments encourage States to
maximize the involvement of these
programs in developing the State' s
strategies, goals, and vision for the one-
stop delivery system in each State. The
Departments revised § 676. 105( d)( 2), by
replacing the term " optional programs"
with " Combined State Plan partner
programs" and also applied the
suggested edit cross-referencing the
term to § 676. 140. The sentence now
reads as " Strategies for aligning the core
programs and Combined State Plan
partner programs as described in
676. 140( d), as well as other resources
available to the State, to achieve the
strategic vision and goals in accordance
with sec. 102( b)( 1)( E) of WIOA."
Throughout this preamble to the Joint
WIOA Final Rule, the Departments have
generally used the term " Combined
State Plan partner program" to refer to
what were called " optional programs"
in the NPRM.
Coordination in Plan Development
Comments: A number of commenters
expressed concern about having an
adequate voice and input into the State
Plan development process. One
commenter requested that the
Departments issue a stronger or clearer
regulation addressing which entities
must be involved in the process.
Departments' Response: The
Departments reviewed these comments
and agree that the regulation would
benefit from a more explicit statement
regarding the role of core programs in
the planning process. In response to
these comments, the Departments have
added a new paragraph (d)( 3)( v) to
676. 105 to clarify that operational
planning elements must include a
description of joint planning methods
across core programs and required one-
stop partner programs and other
programs and activities in the Unified
Plan. Due to this addition, proposed
676. 105( d)( 3)( v) has been redesignated
as § 676. 105( d)( 3)( vi) in this Joint WIOA
Final Rule. The Departments also have
added a new paragraph (c) to § 676.130
to explain how stakeholder and core
program providers should be involved
in plan development, as well as the role
of the State WDB in plan development.
The Departments have made parallel
revisions to §§ 676. 140 and 676. 143 for
Combined State Plans, all of which will
be discussed in connection with each of
these provisions.
Comments: Several commenters
supported the unified planning process
in general but expressed concern about
the lack of oversight and enforcement
mechanisms regarding the requirement
that the development of the plan is
collaborative. The commenters urged
the Departments to remind all the core
programs that they must truly
collaborate if WIOA is to succeed.
Similarly, a commenter said the rule' s
strategic approach will require constant
collaboration between Federal, State,
and local governments, as well as other
community partners, but the willingness
to collaborate among these actors must
be present. This commenter said other
challenges include resistance to change
within the workforce system,
procurement requirements in a single
State area, and conflicting performance
requirements from different funding
streams.
Another commenter said research has
shown that bundling multiple services
leads to more successful outcomes in
the workforce development field, and
the workforce system provides an ideal
platform to integrate financial capability
services because they both are focused
on ensuring individuals have the tools
to participate in, contribute to, and
benefit from the mainstream economy.
Departments' Response: The
Departments issued this Final Rule
jointly to lay the foundation, through
coordination and collaboration at the
Federal level, for implementing the
vision and goals of WIOA. One of
WIOA' s principal areas of reform is to
require States to plan across programs
and include this planning process in the
Unified or Combined State Plans, which
promotes a shared understanding of the
workforce needs of a State and a
comprehensive strategy for addressing
those needs. Unified or combined
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planning can support better alignment
of resources, increased coordination
among programs, and improved
efficiency in service delivery. The
Departments considered these
comments and recognize the challenges
mentioned by the commenters. WIOA
placed heightened emphasis on
coordination and collaboration at the
Federal, State, and local levels to ensure
a streamlined and coordinated service
delivery system for job seekers. The
WIOA State Plan ICR, consistent with
the statutory and regulatory
requirements, reinforces the importance
of collaboration in the development of
State Plans. However, to further address
these comments and others relating to
the issue of collaboration and
stakeholder involvement, the
Departments have added new paragraph
d)( 3)( v) to § 676. 105 to clarify that
operational planning elements must
include a description of joint planning
methods across core programs and
required one-stop partner programs in
the Unified Plan. The WIOA statute and
the WIOA State Plan ICR require the
State to assure that core programs have
reviewed and commented on the
appropriate operational planning
elements of the Unified State Plan, and
approved the elements as serving the
needs of the populations served by such
programs." The Departments have
amended § 676. 105( d)( 3)( iv) to
emphasize this statutorily required
assurance.
Lastly, the Departments note that
some of the stated challenges, such as
procurement requirements, are not
relevant to the regulation of State Plans.
Regarding the challenges cited by
commenters regarding differing
reporting requirements, WIOA has
addressed this challenge by requiring
the six core programs to report
performance outcomes against the
primary indicators of performance. The
core programs will all use the same
definitions and data elements. The
Departments agree that aligning
performance outcomes is a significant
step toward aligning programs. WIOA
sec. 116' s performance requirements are
addressed in the WIOA State Plan ICR
Appendix 1, as well as the WIOA Joint
Performance ICR and part 677 of this
Joint WIOA Final Rule.
The Role of State Workforce
Development Boards in Plan
Development
Comments: Several commenters
requested clarification about the role of
the State WDB in approval of State
Plans. One commenter said the
Departments should require the State
WDB to review and approve the State
Plan before submission. This same
commenter asked if core programs were
required to sign off on the plan, or if
their representation on the State WDB
would serve that purpose. A commenter
asked about the authority of a State
WDB over specific programs' plans,
specifically requesting clarification on
whether the Board can, in effect, veto a
portion of the plan.
Departments' Response: The
Departments reviewed these comments
and agree that the Joint WIOA Final
Rule should provide additional
clarification about the role of the State
WDB in approval of State Plans.
Accordingly, the Departments revised
676. 130( c) and 676.143(b) to clarify
expected roles during plan
development. More detail will be
provided in the discussions related to
these particular sections below. The
Departments expect the States to
recognize the importance of an inclusive
and collaborative process in developing
the State Plan. The Departments also
have revised § 676. 105( d)( 3)( iv), which
implements an assurance required by
sec. 102(b)( 2)( E) of WIOA. Under
676. 105( d)( 3)( iv), States are required to
assure that the lead State agencies
responsible for the administration of the
core programs review and comment on
the appropriate operational planning
sections of the Unified State Plan and
approve that each element serves the
needs of the population served by such
programs.
Comments: A commenter requested
clarification on the processes of State,
regional, and local planning.
Specifically, this commenter wondered
how much direct influence local
workforce boards will have in their
State' s respective State Plans. The
commenter requested greater assurances
that Local WDBs be systematically
included in the State planning process.
Similarly, a commenter recommended
that Governors must have Local WDB
and CEO consent before taking actions
impacting Local WDBs, stating that most
of the best innovations are developed
based on local relationships. Another
commenter recommended regulatory
language that enables local areas to meet
the needs of the State WDB in meeting
their responsibilities under WIOA for
statewide planning, but encourages and
allows local areas to provide their own
input, feedback, and strategies within
the local plan.
Departments' Response: The
Departments agree with the commenters
that it is important for the Governor to
include Local WDBs and CEOs in the
State planning process. Section 679. 110
of 20 CFR requires that State WDB
membership include two or more CEOs
see DOL WIOA Final Rule published
elsewhere in this issue of the Federal
Register). The Governor has the
flexibility to appoint more local elected
officials to the State WDB as he/ she sees
fit. The Departments encourage the
Governor to use this authority, which
may include increasing the
representation of CEOs, to ensure
accurate representation of the interests
of job seekers and businesses in the
State and also to ensure the involvement
of these local representatives in the
State planning process. WIOA does not
require that Governors must have Local
WDB and CEO consent before taking
actions impacting Local WDBs.
However, the Departments do expect
engagement of Local WDBs in the
development of the State Plan through
public comment and input. This is
further discussed below at § 676.130( d).
The requirements for local plan
development and input are discussed in
20 CFR 679. 550 ( see DOL WIOA Final
Rule published elsewhere in this issue
of the Federal Register).
Section 676. 110 What are the program -
specific requirements in the Unified
State Plan for the adult, dislocated
worker, and youth programs authorized
under Workforce Innovation and
Opportunity Act title I?
Section 676. 110 indicates that
program -specific requirements for the
adult, dislocated worker, and youth
workforce investment activities in the
Unified State Plan are described in sec.
102(b)(2)( D)(i) of WIOA. Additional
planning requirements may be
explained in joint planning guidelines
issued by the Secretaries of Labor and
Education.
Proposed Additional Title I Program -
Specific Requirements to State Plans
Comments: One commenter agreed
with the proposed program -specific
requirements in §§ 676. 110 through
676. 125. Another commenter stated that
this section provides insufficient
direction and accountability to ensure
that the needs of individuals with a
barrier to employment or who have
priority of service are adequately
included and addressed in a Unified or
Combined State Plan. The commenter
recommended that the Departments
require that State and local planning
efforts utilize the most current Census
and administrative data available to
develop estimates of each priority
service population in their planning
efforts, and update these data year to
year. The commenter said these data
should he utilized in Federal reviews of
State Plans to ensure that system
designs and projected investments are
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equitably targeted to service -priority
populations. The commenter further
stated that the data also should be used
to benchmark system performance in
actual implementation of the priority of
service from year to year.
Departments' Response: The
Departments have considered these
comments. The WIOA State Plan ICR,
consistent with WIOA requirements for
title I—B programs, requires States to
address priority in the delivery of career
and training services to individuals who
are low income, public assistance
recipients, or basic skills deficient.
WIOA sec. 134( c)( 3)( E) prioritizes these
groups for the receipt of individualized
career services and training services.
The Departments encourage States to
use a variety of accurate, reliable, and
timely labor market information on
which to base analysis and priority of
service. Indeed, priority for use of adult
funds can be made using a variety of
available data, in addition to the use of
Census data. However, to minimize the
burden for each individual State, the
Departments will not require States to
use a particular dataset, leaving it to the
discretion of the States to choose the
appropriate data sources.
Section 676. 115 What are the program -
specific requirements in the Unified
State Plan for the Adult Education and
Family Literacy Act program authorized
under Workforce Innovation and
Opportunity Act title II?
Section 676. 115 explains the
additional planning requirements to
which the AEFLA program is subject.
Section 676. 115 contains three specific
program requirements. First,
676. 115( a) restates the statutory
requirement that the eligible agency
must explain in its Unified or Combined
State Plan how it will align its adult
education content standards with its
State -adopted challenging academic
content standards under the Elementary
and Secondary Education Act by July 1,
2016. Second, § 676. 115( b)( 1) addresses
the requirement that States describe the
methods and factors the State will use
to award multi-year grants on a
competitive basis to eligible providers.
Third, §676.115(b)( 2) requires that
States describe the methods and factors
used to provide direct and equitable
access to funds using the same grant or
contract announcement or application
procedure. Based on comments, and as
discussed further below, the
Departments have deleted proposed
regulatory text at § 676. 115( c)
concerning a requirement to describe
the interoperability of data systems.
Deletion of paragraph (c) is the only
substantive change made to this
regulatory provision from that proposed
in the NPRM.
Timing of Plan Acceptance and Open
Competitions
Comments: Many commenters
expressed concern that States may have
to issue requests for proposals ( RFPs) for
funds before the plans have been
approved. Several commenters said that
this would result in an RFP process that
does not address the objectives of the
State Plan. Some commenters asked that
the Departments provide an additional
transition year in order to allow for the
time necessary for States to receive State
and local plan approval and begin the
implementation of the approved plans,
after which the States could run their
competitions in alignment with the
approved plans.
Departments' Response: The
Departments agree with the
commenters' concerns and recognize the
time that is required for State
procurement processes. The ED
understands that it would create
difficulties to require States to issue
RFPs prior to the State Plan being
approved when the RFPs are intended
to be based on the approved State Plan.
Additionally local plans must be in
place before the RFP can be issued so
applications for subgrants can be
aligned with local plans. The ED has
issued guidance regarding the process
for awarding subgrants to eligible
providers authorized under title II,
which provides information regarding
the timing of competitions and their
alignment with State and local plans. It
is not necessary to address this concern
in the regulation and the regulation is
not revised in response to these
comments.
Alignment With State Elementary and
Secondary Education Act Standards
Comments: Numerous commenters
stated that most States have adopted the
College and Career Readiness Standards
for adult education and will
demonstrate in their State Plans how the
College and Career Readiness Standards
for adult education align with the
standards that State established under
the Elementary and Secondary
Education Act of 1965, as amended
ESEA). These commenters also
expressed concern regarding the
unavailability of standards for adult
education that focus on English
Language Acquisition. Additionally,
commenters raised concerns about the
absence of assessments that measure
performance on the College and Career
Readiness Standards for adult education
and recommended that the Departments
provide a 3 -year transition period
during which States are held
accountable based on the available
assessments instruments. A commenter
also recommended that the Departments
integrate the English language
descriptors into the current adult
education National Reporting System
Educational Functioning Levels
descriptors. Finally, another commenter
recommended that the Departments
adjust accountability measurements to
reflect separate English Language
Acquisition tables in the National
Reporting System from the standard
adult basic education (ABE) standards.
Departments' Response: The
Departments have reviewed the
commenters' concerns related to having
adequate time to establish English
Language Acquisition content
standards, as well as the lack of
assessment mechanism to measure adult
education content standards. The ED
recognizes that English Language
Acquisition content standards do not
yet exist. The ED acknowledges that
there are currently no National
Reporting System -approved assessment
instruments by which to measure
student progress and achievement in
relation to College and Career Readiness
standards. However, based on our
review of the comments, it appears that
some commenters might have
misunderstood the proposed
requirement pertaining to content
standards. The final regulations require
the eligible agency to describe in the
Unified State Plan how, by July 1, 2016,
it will align its content standards for
adult education with State -adopted
challenging academic standards under
the ESEA. The regulations do not
require that the State implement those
standards by July 1, 2016, or that the
State implement assessments aligned to
the standards by July 1, 2016. The ED
intends to issue guidance pertaining to
the alignment and implementation of
standards; the standards for English
language acquisition; and the aligned
assessments for accountability in adult
education. Finally, although the
Departments reviewed the comments
about the integration of the English
Language Acquisition descriptors into
the National Reporting System and the
separation of the accountability
measures in the English Language
Acquisition table from the ABE tables,
the Departments concluded that they do
not have the statutory authority to
address these in the final regulations.
No changes to the regulatory text were
made in response to these comments.
Interoperability of Data Systems
Comments: Numerous commenters
sought clarification on the definition of
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interoperability." Several commenters
stated that there is a national data
integration workgroup at the Federal
level; and recommended that, rather
than each State expending time and
funds to create an interoperable system,
the Departments give the States the
option to await the results of the
national data integration workgroup
before creating their State interoperable
system.
Commenters stated that, due to the
variety in State data systems,
regulations that attempt to implement a
one size fits all" approach are
impractical. These commenters
recommended that the Departments
convey expectations for interoperability
via non -regulatory guidance (including
guidance highlighting existing solutions
and offering States options for reporting
this data). A commenter recommended
that DOL work with other Federal
agencies to establish minimum national
standards for how integrated data
systems should be designed and
interface with existing public systems to
support the employment needs of adults
and youth facing barriers to
employment. The commenter also urged
DOL to work with other Federal
agencies to ensure that integrated data
systems align with existing data being
collected on employment, education,
and training services across Federal
programs.
A commenter said the requirement for
a description of how the State will
ensure interoperability of data systems
in the reporting on core indicators of
performance and performance reports is
listed only under the AEFLA title II
specific section (§ 676. 115); however, in
the law, the requirement for such
information is listed under sec.
102(b)( 2)( C) State Operating Systems
and Policies of WIOA. Therefore, the
commenter suggested § 676. 115( c)
should be moved to § 676. 105, General
Requirements. Another commenter said
the regulations place the responsibility
of ensuring interoperability of data
systems on the title II adult education
programs, which is not feasible because
the various data systems are governed
under different programs and frequently
by different agencies. The commenter
also said the rule seems to place the
burden of supporting the cost of
interoperability on title II adult
education programs, which is not
equitable because there will likely be a
significant cost to creating such
interoperability. The commenter
recommended that the Departments
restate this in regulation as a joint
requirement of core programs and any
programs included in a Combined State
Plan.
Departments' Response: The
Departments agree with commenters'
concerns regarding the complexity of
integration, including the amount of
time, planning, and resources necessary
to achieve such integration. The
Departments agree with the commenters
that the integration and interoperability
of data systems is not limited to title II
of WIOA. The Departments understand
that performance and accountability
data collection and systems integration
is a long-term process that will involve
additional costs and resources for all
programs. The Departments will review
reports from the national data
integration workgroup, as well as
information from the planning
descriptions provided by States in the
initial State Plan, to inform possible
policy decisions and the development of
guidance on this topic. The Departments
also will look into similar data
collection and system integration across
Federal agencies that provide
employment, education, and training
services.
As a result of these concerns, the
Departments have removed the language
proposed in § 676. 115( c), and instead
have included in the WIOA State Plan
ICR, consistent with sec. 102(b)( 2)( C) of
WIOA, a general requirement that States
address fiscal and management
accountability information system
planning across all of the programs
included in a Unified or Combined State
Plan, as required by sec. 116(i)(1) of
WIOA.
Direct and Equitable
Comments: Regarding § 676. 115( b)( 2),
which specifies that all eligible agencies
will provide direct and equitable
access to funds," several commenters
said that there is no specific mention of
this requirement in § 676. 140, which
governs the Combined State Plan. One
commenter sought clarification on
whether this was intentional or an
oversight.
Departments' Response: The
Departments have reviewed these
comments and agree that the omission
of the requirement related to direct and
equitable access of funds in the
Combined State Plan was an error. The
Departments have revised
676. 140( e)( 1) to include this
requirement in the regulations that
address the Combined State Plan.
Request for Guidance
Comments: Several commenters said
States should be required to identify the
guidance they will provide to eligible
providers for nominating an adult
education representative to the Local
WDB that would represent all eligible
providers in the region as well as
communicate board activities.
Departments' Response: The
Departments have reviewed the
comments supporting a requirement
that States issue guidance for adult
education representation on the Local
WDB. States have the authority to issue
such guidance and it is not necessary to
revise the regulations to address this
specific need.
Section 676. 120 What are the program -
specific requirements in the Unified
State Plan for the Employment Service
program authorized under the Wagner-
Peyser Act, as amended by Workforce
Innovation and Opportunity Act title
III?
Section 676. 120 states that Wagner-
Peyser Act Employment Service
programs are subject to the requirements
in sec. 102(b) of WIOA, including any
additional requirements imposed by the
Secretary of Labor under secs.
102(b)( 2)( C)(viii) and 102(b)( 2)( D)(iv) of
WIOA. This section requires States to
include any information the Secretary of
Labor determines is necessary to
administer the Wagner-Peyser Act
Employment Services programs. The
Departments have provided additional
information through jointly issued
planning guidance and the WIOA State
Plan ICR. Except for the addition of a
reference to WIOA sec. 102(b)( 2)( D)(iv)
and other minor technical edits, this
provision remains substantively the
same as that proposed in the NPRM.
WIOA sec. 102( b)( 2)( D)( iv) refers to
Wagner-Peyser Act program -specific
requirements.
Proposed Additional Wagner-Peyser Act
Program -Specific Requirements for State
Plans
Comments: A commenter agreed with
the proposed requirements specific to
Wagner-Peyser Act Employment
Services programs. One commenter
stated that homeless persons should be
a prioritized group for employment
services, including those with no
income or work history, and those with
a criminal background. Also, this
commenter recommended that serving
higher barrier persons be incentivized.
Departments' Response: The
Departments agree with the importance
of ensuring that States address the needs
of very low income and homeless
populations in the State Plan. As
discussed under § 676. 105, the WIOA
State Plan ICR, consistent with WIOA,
requires that Unified and Combined
State Plans address the needs of
individuals with barriers to
employment. As defined in sec. 3( 24)( G)
of WIOA, an " individual with a barrier
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to employment" includes homeless
individuals or homeless children and
youths. However, employment services
under the Wagner-Peyser Act are
universal and available to all; the
Departments do not have the authority
to prioritize use of Wagner-Peyser Act
funds for specific populations.
Comments: Several commenters said
the regulation should require State
workforce agencies to include a clearly
defined management reporting structure
for State merit -based employees as part
of the State Plan for each one-stop
center to minimize confusion and
protect the systemic integrity of Wagner-
Peyser Act services.
Departments' Response: While the
Departments recognize the importance
of adhering to merit staffing
requirements for Wagner-Peyser Act
services, the Departments decline to
require a reporting structure for merit
staff in the regulation or in the WIOA
State Plan ICR because it imposes an
unnecessary burden on States. However,
a State may elect to develop such a
policy and include it in its State Plan.
Section 676. 125 What are the program -
specific requirements in the Unified
State Plan for the State Vocational
Rehabilitation program authorized
under title I of the Rehabilitation Act of
1973, as amended by Workforce
Innovation and Opportunity Act title
IV?
Section 676. 125 requires States to
submit a VR services portion as part of
the Unified State Plan that complies
with all State Plan requirements set
forth in sec. 101( a) of the Rehabilitation
Act of 1973, as amended by title IV of
WIOA. All submission requirements of
the VR Services portion of the Unified
State Plan are in addition to the jointly
developed strategic and operational
content requirements prescribed by sec.
102(b) of WIOA. Except for minor
technical edits, this provision remains
substantively the same as that proposed
in the NPRM.
Individuals With Disabilities in the VR
Program
Comments: A commenter agreed with
the requirements specific to the VR
program.
Some commenters stated that there
should be greater emphasis on the VR
program in the State Plans. The
commenters encouraged Governor -
mandated appointment of disability
service providers on State WDBs to
ensure proper representation for the
development of this section of the plan.
Similarly, other commenters urged the
Departments to encourage greater
inclusion of stakeholders within the
disability community in the
development, review, and
implementation of the plans. One
commenter further encouraged the
Departments to issue guidance that will
ensure that State executives will not
ignore or under -represent the workforce
development needs of people with
disabilities in the strategic and
operational planning outline in either
the Unified or Combined State Plan.
Departments' Response: In response
to the first concern, the Departments
refer commenters to the WIOA State
Plan ICR where the VR program is
addressed at length in Section VI
Program -Specific Requirements for Core
State Plan Programs. This section
overviews the descriptions and
estimates that must be included in the
VR Services Portion of a State Plan, as
required by sec. 101( a) of the
Rehabilitation act of 1973, as amended
by WIOA, and sec. 102(b)(2)(D)(iii) of
WIOA. State WDB membership
requirements are addressed in 20 CFR
679. 110 ( see DOL WIOA Final Rule
published elsewhere in this issue of the
Federal Register). The Departments also
note that beyond these requirements,
the constitution of State WDBs and their
membership has been left to the States.
Although State Plans must include a
State WDB Membership Roster and a list
of Board activities as described in sec.
III(b)( 3)( B) of the WIOA State Plan ICR,
the Departments have concluded that it
is unnecessary to include additional
regulatory text. With regard to greater
stakeholder involvement in the review
and implementation of State Plans,
676. 130( d) and 676. 143( c), already
require that States provide an
opportunity for comment on and input
into the development of a State Plan
from representatives of Local WDBs and
CEOs, businesses, labor organizations,
institutions of higher education, other
stakeholders with an interest in the
services provided by the six core
programs, and the general public,
including individuals with disabilities.
Thus, stakeholders with disabilities are
required to have opportunity to engage
in the development of State Plans.
Finally, sec. 102(b) of WIOA and the
WIOA State Plan ICR require the State
to address the needs of individuals with
barriers to employment within the State
Plan' s Strategic Vision and Goals and
Operational Planning Elements.
According to WIOA sec. 3( 24), the term
individual with a barrier to
employment" includes individuals with
disabilities, including youth who are
individuals with disabilities.
Interagency Cooperation
Comments: A commenter said the
Departments should make explicit the
importance of including State
developmental disabilities agencies in
cooperative agreements regarding
individuals eligible for home and
community-based waiver programs.
Another commenter stated that, in
addition to the cooperative agreement
between VR and the State
developmental disabilities agency, State
Plans should be required to contain a
cooperative agreement between
Medicaid and the State mental health
agency in order to promote effective
collaboration between State agencies.
Departments' Response: While not
stated in the regulation itself, the WIOA
State Plan ICR describes how a State
will incorporate interagency
cooperation between VR and other State
agencies providing assistance to or
serving individuals with disabilities. In
the WIOA State Plan ICR, consistent
with sec. 101( a)( 11) of the Rehabilitation
Act, as amended by title IV of WIOA,
the VR agency must describe the
collaboration between the responsible
State agency administering the State
Medicaid plan, the State agency serving
individuals with developmental
disabilities, and the State agency
responsible for providing mental health
services. Nothing in this requirement
restricts collaboration between agencies,
as the goal is to develop opportunities
for competitive integrated employment
to the greatest extent possible. A more
detailed discussion of the collaboration
between the VR agency and other
agencies serving individuals with
disabilities is provided in ED' s Final
Rule related to the VR program
published elsewhere in this issue of the
Federal Register.
VR Program' s Order of Selection
Comments: One commenter
referenced a proposal to give State VR
agencies operating under an Order of
Selection the option to indicate that
they will serve eligible individuals with
disabilities outside the Order of
Selection who have an immediate need
for equipment or services to maintain
employment. The commenter requested
clarification in determining what
services or equipment is allowed to be
provided if identified as an immediate
need if the individual is in jeopardy of
losing his or her job.
Departments' Response: Section
101( a)( 5)( D) of the Rehabilitation Act of
1973, as amended, indicates that State
Plans shall, under an Order of Selection,
permit the State, in its discretion, to
elect to serve eligible individuals who
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require specific services or equipment to
maintain employment. The WIOA State
Plan ICR allows for the VR program to
identify whether it will serve eligible
individuals with disabilities outside the
Order of Selection who has an
immediate need for equipment or
services to maintain employment.
Services or equipment provided to
eligible individuals under these
circumstances must be determined on
an individual basis according to the
employee' s need required to maintain
employment, consistent with the
Individualized Plan for Employment. A
much more detailed discussion of this
issue is provided in ED' s Final Rule
covering the VR program published
elsewhere in this issue of the Federal
Register.
Records and Data Collection
Comments: A commenter said the
Departments should identify ways to
allow State VR agencies to gain ready
access to Federal employment data,
such as the data that are available
through the Federal Employment Data
Exchange System funded by DOL.
Departments' Response: The
Departments addressed this issue
through the WIOA State Plan ICR
process. Section III(b)( 6)( A) of the WIOA
State Plan ICR states that State agencies
responsible for the administration of
core programs ( such as the VR program)
shall describe plans to align and
integrate available workforce and
educational data systems for the core
programs, unemployment insurance (UI)
programs, and education through
postsecondary education. This directive
provides sufficient identification of the
opportunities available to States to
incorporate both State and Federal data
into their State programs. For this
reason, no changes to the regulatory text
were made in response to this comment.
Independent Living for Older
Individuals Who Are Blind Program
Comments: A couple of commenters
opposed eliminating a requirement in
the State Plan for the Independent
Living for Older Individuals who are
Blind program, stating that this
elimination constitutes a great
disservice to older persons with vision
loss. The commenters recommended
that an Independent Living for Older
Individuals who are Blind section be
added to the VR section of the Unified
or Combined State Plans.
Departments' Response: The
Independent Living for Older
Individuals who are Blind program is
covered under title VII of the
Rehabilitation Act of 1973, as amended
by WIOA, and is not among the six core
programs that must submit a Unified
State Plan pursuant to sec. 102 of
WIOA. The VR services portion of the
Unified or Combined State Plan is
similar in content to the standalone VR
State Plans that were submitted prior to
the passage of WIOA and covers only
the VR program requirements of title I
of the Rehabilitation Act, as amended by
WIOA. The Independent Living for
Older Individuals who are Blind
program requires submission of an
application with assurances every 3
years that complies with the
requirements for that program as set
forth in title VII of the Rehabilitation
Act, as amended by WIOA. A detailed
discussion of the Independent Living
Services for Older Individuals Who are
Blind program ( 34 CFR part 367) is
provided in ED' s Final Rule of WIOA
Miscellaneous Programs published
elsewhere in this issue of the Federal
Register.
Section 676. 130 What is the
development, submission, and approval
process of the Unified State Plan?
In order to facilitate the State strategic
planning process, and concurrent
review by the relevant Federal program
offices, this section requires the Unified
State Plan to be submitted to the
Secretary of Labor, according to the
procedures established in sec. 102( c) of
WIOA, which are clarified and
explained through joint planning
guidelines. Likewise, the Departments,
upon receipt of a Unified State Plan,
follow procedures established by this
section. Section 676. 130 also explains
requirements for transparency, public
comment, and submission, as well as
the terms for approval of plans by the
Secretaries of Labor and Education.
Section 676. 130( a) requires that the
Unified State Plan be submitted in
accordance with the procedures set out
in the joint planning guidelines, issued
by the Secretaries of Labor and
Education, which explains the
submission and approval process
described in sec. 102( c) of WIOA.
Sections 676. 130( b)( 1) and ( 2)
reiterate the requirement at sec.
102( c)( 1) of WIOA regarding the
deadlines for submitting the initial and
subsequent Unified State Plans to the
Departments. The Departments
developed a process for submission of
Unified State Plans to ensure that ED
receives the entire Unified State Plan
submission concurrently. WIOA secs.
102( c)( 1)( A) and 103( b)( 1) require States
to submit the initial Unified or
Combined State Plan no later than 120
days prior to the commencement of the
second full program year after the date
of enactment (i.e., July 1, 2016), making
the statutory submission date for the
initial Unified or Combined State Plan
March 3, 2016. However, pursuant to
the orderly transition authority in sec.
503 of WIOA, the Departments
considered the initial Unified or
Combined State Plans timely if
submitted by April 1, 2016.
Section 102( c)( 1)( B) of WIOA requires
subsequent Unified State Plans to be
submitted not later than 120 days prior
to the end of the 4 -year period covered
by the preceding Unified State Plan. In
other words, WIOA Unified State Plans
cover 4 -year periods, and the
subsequent plan must be submitted no
later than 120 days before existing
plan' s 4 -year period ends. The
Departments have made clarifying edits
to the regulatory text in § 676.130(b)( 2)
to more clearly align it with these
statutory requirements. The
Departments anticipate that the second
Unified State Plans will need to be
submitted in the spring of 2020. The
official submission dates for the plans
will be announced in the joint planning
guidelines.
Section 676. 130( b)( 3) clarifies that,
consistent with current practice for
many of the core programs, a program
year runs from July 1 through June 30
of any year. This clarification is
particularly important, in this context,
for the VR program since that program
operates on a Federal fiscal year basis
and will continue to do so, in
accordance with title I of the
Rehabilitation Act of 1973, despite the
fact that the VR services portion of the
Unified State Plan will align, for
submission and performance purposes,
with the other partners on a program
year basis.
In order to more accurately reflect the
content of § 676. 130, the Departments
have made a change to the title to
include the word " development."
Additionally, in response to comments,
described below, requesting clarity
regarding the role of the State WDB,
core program administrators and
required one-stop partners, the
Departments have added § 676. 130( c).
This additional paragraph explains the
statutory requirement that the Unified
State Plan must be developed with the
assistance of the State WDB and must be
developed in coordination with
administrators with optimum policy-
making authority for the core programs
and required one-stop partners. The
term " optimum policy-making
authority" is defined in 20 CFR 679. 120
as " an individual who can reasonably
be expected to speak affirmatively on
behalf of the entity he or she represents
and to commit that entity to a chosen
course of action." See DOL WIOA Final
55811Federal Register / Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
Rule published elsewhere in this issue
of the Federal Register. Accordingly,
676. 130( c) through (h) have been
renumbered at § 676.130(d) through (i).
Other than these changes to paragraph
b)( 2), the addition of paragraph ( c), and
the edit to paragraph (h) discussed
below, no changes to the regulatory text
have been made.
Deadlines
Comments: The Departments received
a comment that supported the timeline
for developing initial Unified State
Plans. Several commenters requested
clarification about the definition of
program year, specified in
676. 130(b)( 3), as it applies to VR,
noting that the VR program operates on
a Federal fiscal year. A couple
commenters said the specified program
year may put additional administrative
burden and costs, especially in the
startup, on State VR agencies. A
commenter said the VR agencies should
continue to report as they currently do.
Due to the difference in fiscal year
versus program year, one commenter
recommended that the VR program be
transferred to DOL to ensure seamless
coordination of workforce activity at the
Federal and State level and to ensure
that the States operate unified,
integrated programs. However, other
commenters said it is unclear whether
the change in program will be a burden
for State VR agencies. In fact, one
commenter anticipated a benefit for
aligning State match, fiscal planning,
and managing funds. One of these
commenters said that ED should survey
State VR agencies to see if this will
prove to be a burden or an issue for
administration of the State Plan.
A commenter remarked that
performance data and plans will be on
the program year basis and that Federal
awards and reporting will remain on the
fiscal year basis. The commenter sought
clarification as to how reporting and
performance timeframes will be
integrated.
Departments' Response: The
Departments acknowledge the concerns
expressed by commenters. The VR
program will utilize a program year,
according to the § 676. 130( b)( 3)
definition, for the purposes of reporting
performance and identifying its goals
and priorities as part of the VR portion
of the Unified or Combined State Plan.
Since data will be collected quarterly,
RSA will have the flexibility to report
performance data for each of the VR
agencies for both the program year and
the fiscal year. The Departments have
not concluded that this will cause any
additional burden to the VR agencies for
the development of the VR portion of
the State Plan, in particular, to establish
and evaluate the State' s performance
measures. Further guidance about
performance reporting for VR agencies
will be provided in the final ICR for the
RSA -911 report. Fiscally, the VR
agencies will continue to operate on a
Federal fiscal year basis as required
statutorily pursuant to secs. 110 and 111
of the Rehabilitation Act of 1973, as
amended. The WIOA State Plan ICR
Appendix 1 clarifies what performance
information States must include in the
State Plan. The Departments provided
further instructions through the WIOA
Joint Performance ICR, the WIOA State
Plan ICR, and related joint guidance.
Finally, WIOA does not authorize the
VR program to move to DOL.
Stakeholder Involvement
Comments: Numerous commenters
expressed concern about having
adequate voice and input into the State
Plan development process, and a
number of commenters requested
stronger or clearer regulation on who
must be involved in the State Plan
development process. Commenters said
the Departments should require a role in
the planning process for core programs,
one-stop partners, State and Local
WDBs, and CEOs, among other entities.
Departments' Response: Although
WIOA requires an inclusive planning
process, and there are many references
to inclusiveness in planning and
program implementation throughout the
Joint WIOA Final Rule, the Departments
considered these comments and agree.
The Joint WIOA Final Rule will
continue to emphasize inclusiveness in
planning and program implementation
and will further benefit from a more
explicit statement of the entities
required to participate in the
development of Unified State Plans. In
response to the comments, the
Departments have added regulatory text
in a new paragraph ( c) to § 676. 130 to
clarify that Unified State Plans must be
developed with the assistance of the
State WDB and in coordination with
administrators with optimum policy-
making authority for the core programs
and required one-stop partners. In
addition, to ensure consistency, the
Departments have added regulatory text
in a new paragraph ( d)( 3)( v) of
676. 105, discussed above, requiring
that the Unified Plans include a
description of joint planning and
coordination across core programs,
required one-stop partner programs and
other programs and activities included
in the Unified Plan." The Departments
also have revised the title of § 676. 130
to include the word " development" to
clarify that this section describes the
development of the Unified State Plan,
as well as submission and approval.
These changes are reflected in the
WIOA State Plan ICR.
Collaboration and Input Into the Plan
Process
Comments: A couple of commenters
recommended that States should
include title II adult education partners,
as well as other immigrant -serving
organizations, in their WIOA planning.
A few commenters suggested that
refugee programs and service providers
be included in planning at the State and
Local level and that the Departments
should emphasize in the regulation' s
discussion of local governance the
importance of providing expertise in
serving linguistically and culturally
diverse populations. Some commenters
noted several organizations should have
input into the development of State
Plans, including: quality credentialing
organizations, immigrant -serving
organizations, State and local human
service agencies, community and
technical colleges, nonprofit
community-based and nontraditional
service providers, and State
Departments of Education.
Departments' Response: The
Departments considered these
comments and note that collaboration in
the planning process for Unified and
Combined Plans is required of title II
adult education program partners as
they are among the core programs
included in all plans. The WIOA State
Plan ICR enables States to include
human services, faith-and community-
based organizations, and educational
institutions in the State Plan, as well as
other Federal programs, particularly as
part of a discussion of innovative
partnerships with the one-stop delivery
system. These types of organizations
may include immigrant -serving
organizations and refugee programs. No
change to the regulatory text was made
in response to these comments.
Public Comment and Availability of
Information
Comments: One commenter said the
rule should reaffirm that, as one of its
responsibilities, the State WDB must
provide an environment for State Plan
development that is conducive to
participation and receptive to input.
Further, this commenter stated that
States should be required to describe
how they will make this process
accessible to individuals with
disabilities.
Departments' Response: The State
must provide an opportunity for
comment and input into the State Plan.
Furthermore, the Departments agree that
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the public comment process must be
accessible to all concerned
organizations and individuals,
including individuals with disabilities.
As described in § 676.130( d)( 1), the
State must provide an opportunity for
public comment on and input into the
development of the Unified State Plan
prior to its submission which includes
an opportunity for comment by
representatives of Local WDBs and
CEOs, businesses, representatives of
labor organizations, community-based
organizations, adult education
providers, institutions of higher
education, other stakeholders with an
interest in the services provided by the
six core programs, and the general
public, including individuals with
disabilities. Further, as discussed
earlier, the WIOA State Plan ICR,
consistent with WIOA, requires the
State to address the needs of individuals
with barriers to employment including
the needs of English language learners.
Comments: Several commenters
stated that the consultation requirement
should accommodate Single States that
have only a volunteer State WDB and no
Local WDB to consult.
Departments' Response: Although
single -area States have no Local WDB to
consult, they still have stakeholders,
including CEOs. In accordance with
676. 130( d)( 1), single -area States must
provide an opportunity for comment by
CEOs and other stakeholders as a part of
the opportunity for public comment on
State Plans, which includes local
officials and local stakeholders.
Comments: A couple commenters
recommended a minimum notice period
of 90 days for the opportunity for public
comment on the development of the
Unified State Plan. A commenter urged
the Departments to require that States
publicly post the plan electronically and
that the Departments themselves create
an electronic database where States,
policy makers, advocates, and the
general public can access all of the
plans.
Departments' Response: The
Departments have reviewed these
comments and decline to set a number
of days for public comment of Unified
State Plans, leaving the decision of
schedules for public comment and
posting plans electronically to the
discretion of the States. Many States'
laws require a minimum number of days
for public comment, and many States
use online posting as a way of making
the plans available for public comment.
While the Departments are not adding a
regulation regarding an electronic
database, the Departments provide a
centralized online access point for
completed State Plans.
Review and Approval of Unified State
Plans
Comments: A commenter stated that
WIOA indicates that approval of the
Unified State Plan will occur within 90
days after submission, but the NPRM
stated that it will occur within 90 days
of receipt. The commenter
recommended a revision to the language
making the terminology for establishing
the timeframe for review and approval
of plans be consistent and that a
definition be provided for determining
that start date.
Departments' Response: The
Departments decline to change the
regulatory text and retain the use of the
word " receipt" in the renumbered
676.130( h) in order to allow the
Departments to have a full 90 days to
review the plan in the event of any
delay in transmission of the plan from
the State to the Departments. However,
the Departments have replaced the
words " by the appropriate Secretary" in
paragraph (h) with "the Secretary of
Labor," to clarify that the 90 -day review
period begins upon receipt of the plan
by the Secretary of Labor. This wording
is more closely aligned with the statute,
at WIOA sec. 102( c)( 1). As stated in
paragraph (e) of this section,
immediately upon receipt of a Unified
State Plan from a State, the Secretary of
Labor will ensure that the entire Unified
State Plan is submitted to the Secretary
of Education pursuant to a process
developed by the Secretaries. At that
point, the Secretaries will begin their
review.
Comments: Several commenters said
States whose Unified State Plans are
rejected should be given detailed
reasons why in writing so those States
can focus on areas that need
improvement.
Departments' Response: As a part of
the approval process, the Departments
intend to provide States with detailed
reasons in writing if a plan is not
approvable.
Comments: A few commenters
asserted that there was lack of clarity in
the NPRM regarding whether the
Unified Plan submission process will
change. These commenters
recommended that DOL issue a TEGL
on the submission process of the
Unified Plan. Similarly, a commenter
said more guidance is needed to
understand how this process will work
and differ from previous Unified Plan
submissions.
Departments' Response: The
Departments considered these
comments and agree that additional
guidance will assist States in
understanding the submission and
approval process for Unified State
Plans. The Departments issued joint
guidance, which describes the
submission process in greater detail.
This joint guidance included TEGL No.
14- 15, " Workforce Innovation and
Opportunity Act (WIOA) Requirements
for Unified and Combined State Plans,"
issued to DOL grantees, a Program
Memorandum issued to AEFLA
grantees, and a Policy Directive issued
to VR program grantees, all of which
contained identical content.
Rehabilitation Services Administration
Approval of Plan
The renumbered § 676. 130( g) states
that before the Secretary of Labor and
the Secretary of Education approve the
Unified State Plan, the VR portion of the
Unified State Plan must be approved by
the Commissioner of the Rehabilitation
Services Administration (RSA).
Comments: Several commenters
requested clarification on whether the
90 -day approval timeframe for the entire
plan starts when the VR portion of the
Unified State Plan is approved by the
RSA Commissioner or when it is
subsequently forwarded to the ED and
DOL Secretaries for approval. A
commenter suggested that the regulation
require a timeline for the Commissioner
of RSA to approve or disapprove the VR
portion of the Unified State Plan.
Departments' Response: The 90 -day
review timeframe, which begins upon
receipt of the State Plan by DOL,
includes RSA Commissioner review and
approval. The VR program is an ED
program, and ED' s and DOL' s reviews of
plan submissions are concurrent.
However, the approval of the VR
services portion of the plan by the RSA
Commissioner must occur first, after
which the plan, if it complies with all
of the other requirements, will be
officially approved by the Secretaries of
Labor and Education. The Secretaries of
Labor and Education have developed a
process to ensure that both Departments
receive the entire Unified State Plan
submission concurrently to ensure
timely review. The Departments have
concluded that the existing regulatory
text and preamble place adequate
emphasis on the timely concurrent
reviews of the plans by the Departments
and no changes to the regulatory text
were made in response to these
comments.
Comments: Some commenters asked
whether it is the responsibility of the
State VR agencies or the Secretaries of
Labor and Education to obtain approval
from the RSA Commissioner. One of
these commenters stated that placing
the responsibility on VR agencies to
ensure that this review is done
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especially before submission of the
plan to the Secretaries by the States)
would be an unfair burden to place on
VR agencies and States. This commenter
further asked when the deadline is for
the submittal of the VR portion of the
State Plan to the RSA Commissioner, if
it is the responsibility of State VR
agencies to submit and obtain approval
of the VR portion of the plan by the RSA
Commissioner prior to submission to
the Secretary of Labor.
Departments' Response: It is not the
State VR agencies' responsibility to
submit and obtain approval of the VR
portion of the State Plan prior to
submitting the Unified Plan to the
Departments. Rather, the entire Unified
State Plan, including the VR services
portion of that Plan, should be
submitted to the Departments, and the
review and approval by the RSA
commissioner will take place following
that submission as a part of the 90 -day
Federal review of the plan. The ED,
including RSA, and DOL will work
together to ensure the timely review and
approval of all portions of the State
Plans, including the VR services
portion. The Departments have
developed a process for submission of
Unified State Plans to ensure that the
Departments of Labor and Education,
including the RSA Commissioner,
receive the entire Unified State Plan
submission concurrently. The
Departments have concluded that the
existing regulatory text and preamble
place adequate emphasis on the timely
concurrent reviews of the plans by the
Departments.
Comments: Some commenters
requested clarification on what happens
to the full Unified State Plan if the RSA
Commissioner does not approve the VR
portion of the State Plan.
Departments' Response: Approval of
the Unified State Plan requires that the
requirements of all core programs are
met, including the requirements for the
VR portion of the State Plan. No change
to the regulatory text was made in
response to these comments.
Guidance on Submission and Approval
Process
Comments: Several commenters
provided suggestions for potential joint
guidance from the Departments and
how the guidance should influence the
submission and approval process for
Unified State Plans. Some commenters
recommended that the Departments
issue guidance that provides
recommendations for how States can
develop appropriate outreach and
engagement strategies for stakeholders.
One commenter said the Departments
should issue guidance that addresses
whether the VR agency should hold
separate public meetings on their
portion of the State Plan or schedule a
unified public meeting for the entire
State Plan. One commenter welcomed
guidance from the Departments that
advises State and local areas on whether
to submit workforce plans that cover
additional workforce related programs
besides the six core programs.
Numerous commenters requested that
any guidance from the Departments that
provides further details on the
submission of the State Plans be
released as early as possible. A few
commenters said States may be waiting
for guidance from the agencies before
beginning their planning processes in
earnest, which may cause some States to
bypass key opportunities for stakeholder
engagement or forgo pursuing a
Combined State Plan in an effort to meet
the statutory deadlines for plan
submission.
A commenter said it would be useful
if the Departments provided a template
for the Unified and Combined State
Plans, ideally several months before the
plan is due. The commenter also said
ensuring that the templates are available
at least several months ahead of the
submission deadline would make the
process of completing the plan much
more efficient for States.
Departments' Response: The
Departments issued joint planning
guidelines that address these and other
topics regarding State Plan
development, submission, and approval
and the requirements of the WIOA State
Plan ICR. For example TEGL No. 14- 15,
Workforce Innovation and Opportunity
Act (WIOA) Requirements for Unified
and Combined State Plans," was issued
on March 4, 2016. The ED issued
identical guidance to its grantees via
Program Memorandum OCTAE 16-1
http:// www2.ed.gov/about/offices/list/
ovae/ wioa-16-1. pdf) and RSA—PD-16-
03 (http:// www2.ed.gov/policy/speced/
guid/ rsa/ pd/2016/pd-16-03.pdf) on
March 9, 2016. VR agencies must still
meet the requirements for public
participation prior to the submission or
amendment of a State Plan in
accordance with 34 CFR 361. 20.
Although not commonly referred to as a
template, the WIOA State Plan ICR is a
detailed and comprehensive set of
requirements for developing and
submitting State Plans. In addition to
the written joint guidance, the
Departments also have presented
multiple webinars on the development
and submission of the State Plans. No
change to the regulatory text was made
in response to these comments.
Section 676. 135 What are the
requirements for modification of the
Unified State Plan?
Given the multi-year life of the
Unified State Plan, States must revisit
regularly State Plan strategies and
recalibrate these strategies to respond to
the changing economic conditions and
workforce needs of the State. At a
minimum, a State is required to submit
modifications to its Unified State Plan at
the end of the first 2 -year period of any
4 -year plan and also under other
specific circumstances, examples of
which have been included in this
section. States may choose to submit a
State Plan modification at any time
during the life of the plan. Section
676. 135 further describes the
requirements for submission and
approval of Unified State Plan
modifications, which are subject to the
same public review and comment
requirements and approval process as
the full Unified State Plan submissions.
Except for minor technical edits, such
as corrections to cross-references to
other sections that have been
renumbered and edits to conform with
changes to part 677 on the performance
accountability system, this section
remains substantively the same as that
proposed in the NPRM.
Timeframe for Unified Plan
Modifications
Comments: One commenter
supported the 2 -year timeline for
modifying initial Unified State Plans
specified in § 676. 135( a). Another
commenter said Federal agencies should
use the State Unified Plan timeframe for
submitting mandatory modifications to
review the regulatory framework and
other guidance under which WIOA is
initially implemented. The
Departments, this commenter
continued, should use this time to
review how the challenges and
opportunities involved in WIOA' s
implementation have evolved.
Departments' Response: The
Departments considered this comment
and agree. The Departments intend to
update existing and future regulations,
ICRs, and guidance as appropriate and
as needed for the continued effective
implementation of WIOA.
Unified State Plan Modification
Requirements
Comments: Regarding proposed
676. 135(b), several commenters stated
that modifications to State Plans only
should be necessary in the event of
significant or substantial changes in
labor market and economic conditions
or other factors significantly affecting
implementation of the plan.
55814 Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
Departments' Response: The
Departments recognize the balance
between the benefit of periodic
modifications of State Plans and the
potential burden of submitting State
Plan modifications beyond those
required at the end of the first 2 -year
period. The Departments agree that
periodic review of State Plans aids in
the continual update and improvement
of State policies and that State Plan
modifications other than those required
at the end of the first 2 -year period
should be required only in the event of
substantial changes impacting the plan.
Paragraph (b) of §676.135, which is
consistent with WIOA, requires States to
submit modifications at the end of the
first 2 -year period, and these
modifications must reflect changes in
labor market and economic conditions.
Other than this 2 -year modification,
States are required to submit
modifications only when changes in
Federal or State law or policy
substantially affect the strategies, goals,
and priorities upon which the Unified
State Plan is based, or when there are
changes in the statewide vision,
strategies, policies, State negotiated
levels of performance (see § 677.170(b)
of this Joint WIOA Final Rule), the
methodology used to determine local
allocation of funds, reorganizations
which change the working relationship
with system employees, changes in
organizational responsibilities, changes
to the membership structure of the State
WDB or alternative entity, and similar
substantial changes to the State' s
workforce investment system.
Public Comment on Unified State Plan
Modifications
Comments: Several commenters
stated that the VR regulations in 34 CFR
part 361 already address when public
comments are needed in the State Plan
modification process. Specifically, any
change to the VR portion of the State
Plan that directly affects the provision
of services, such as Order of Selection
or the imposition of a financial needs
test, would require public review and
input before such a change is made.
These commenters recommended that
the Joint WIOA Final Rule here reflect
the same high threshold for public
comments on State Plan modifications
for the other five core programs.
Departments' Response: Paragraph (c)
of § 676. 135 contains the same public
review and comment requirements for
all modifications to Unified State Plans
as those for the development of initial
Unified State Plans specified in
676. 130( d). In addition, States must
adhere to any program -specific
requirements for the core programs
included in the State Plan, such as
sec. 101( a) of the Rehabilitation Act of
1973, as amended, and its implementing
regulations under 34 CFR 361. 10 and
361. 20. The Departments do not require
that the entire plan be subject to the
program -specific public comment
requirements of the VR rules in 34 CFR
part 361. However, the Departments
plan to issue further guidance regarding
State Plan modifications.
Comments: Some commenters said
States should have the flexibility to
define what constitutes a major change,
as plan modifications necessitated by
minor changes are burdensome and
expend valuable resources. One
commenter stated that there was no
definition of " substantial change"
provided in the NPRM and suggested
that the threshold for " substantive
change" in proposed 34 CFR
361. 20( a)( 2) be used in the Joint WIOA
Final Rule. Another commenter said
substantial change" should be defined
as a change that involves a substantive
change to service delivery or
participating partners or substantial
fiscal impact.
Departments' Response: The
Departments agree that State Plan
modifications other than those required
after the first 2 -year period for State
Plans should be limited in order to
avoid undue burden. However, the
Departments also want to ensure State
Plans are up to date and that States
periodically review State Plans.
Sections 676. 135( b)( 2) and (3) describe
the circumstances where a Unified State
Plan modification is required (other
than at the first 2 -year period). States are
required to modify State Plans when
changes in Federal or State law or
policy substantially affect the strategies,
goals, and priorities upon which the
Unified State Plan is based; or when
there are changes in the statewide
vision, strategies, policies, State
negotiated levels of performance, the
methodology used to determine local
allocation of funds, reorganizations
which change the working relationship
with system employees, changes in
organizational responsibilities, changes
to the membership structure of the State
WDB or alternative entity, and similar
substantial changes to the State' s
workforce development system. The
Departments have not defined the term
substantial change" in this regulation
and have instead outlined in the
regulation the specific situations where
modifications of Unified State Plans are
required.
Section 676. 140 What are the general
requirements for submitting a Combined
State Plan?
States have the option to submit a
Combined State Plan that goes beyond
the core programs of a Unified State
Plan to include at least one additional
Federal workforce, educational, or
social service program from the
programs identified in sec. 103( a)( 2) of
WIOA. Generally, the requirements for a
Combined State Plan include the
requirements for the Unified State Plan
as well as the program -specific
requirements for any Combined State
Plan partner programs that are included
in the Combined State Plan. To expand
the benefits of cross -program strategic
planning, increase alignment among
State programs, and improve service
integration, the Departments strongly
encourage States to submit Combined
State Plans.
Section 676. 140 specifies the general
requirements for submitting a Combined
State Plan. Paragraph (a) of § 676. 140
states that a State may choose to
develop and submit a 4 -year Combined
State Plan in lieu of the Unified State
Plan. The Departments have edited
676. 140( a), as well as § 676. 140( e)( 1),
to correctly cite references to Unified
State Plan requirements that must be
included in a Combined State Plan.
Paragraph (e) of §676.140 specifies the
information that a Combined Plan must
contain. Paragraph (e)( 2) of §676.140
has been edited to include the words
and activities," to clarify that the
Combined Plan must provide the
required information for any programs
and activities included in the State Plan.
Section 676. 140( e)( 3), consistent with
WIOA, has been revised to expand the
required description of joint planning
and coordination to include core
programs, required one-stop partner
programs and other programs and
activities included in the State Plan.
Section 676. 140( i) is a new paragraph
that requires States that submit
employment and training activities
carried out by HUD under a Combined
State Plan to submit any other required
planning documents for HUD programs
directly to HUD, according to the
requirements of Federal law and
regulations. Except for the changes
described here, this section remains
unchanged from that proposed in the
NPRM.
Comments: One commenter said
planning and implementation must be a
thoughtful process, and system
transformation cannot be rushed. This
same commenter also said there should
be increased interagency collaboration
between the Departments. Specifically,
55815Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
the commenter stated that there should
be more incentives for programs within
the two Departments to be included in
a Combined State Plan.
Departments' Response: The
Departments considered these
comments but did not make changes to
the regulatory text based on them. The
Departments agree that planning and
implementation must be thoughtful
processes and that system
transformation is an ongoing process.
WIOA does not authorize incentives for
States submitting a Combined State
Plan. However, the Departments
encourage States to be as inclusive as
possible in their State Plans because
joint planning across programs,
including between those in the two
Departments, fosters greater alignment
and coordination of services.
Planning Cycles
Section 676. 140( a) allows States to
choose to develop and submit a 4 -year
Combined State Plan in lieu of the
Unified State Plan. In the NPRM, the
Departments note that the Combined
Plan' s 4 -year plan development and
implementation cycle, with a 2 -year
modification deadline, is inconsistent
with the planning cycles governing
many Combined State Plan partner
programs. The Departments sought
comment on how to reconcile differing
planning cycles across Combined State
Plan partner programs that do not align
with the 4 -year planning required by
WIOA. In response, commenters
provided various recommendations.
Comments: A few commenters said an
approved Combined State Plan should
suffice to meet the planning
requirements of Combined State Plan
partner programs and that Federal
agencies should address the issues of
differing planning cycles at the Federal
level through executive actions. Another
commenter said the Departments should
require Combined State Plan partner
programs to describe their planning
cycles for the upcoming 4 years, and to
include when during the next 4 years
they may need to submit modifications
to their part of the Combined State Plan.
Similarly, two commenters suggested
that the Combined State Plan report on
the progress of the mid-cycle plan
submitted by the Combined State Plan
partner program(s) and include language
on how the Combined State Plan partner
program' s submitted plan includes
integration with WIOA programs.
Departments' Response: WIOA does
not authorize the Departments to change
the planning requirements, including
submission deadlines that are under
other authorizing legislation. However,
WIOA gives the States the ability to
apply the 2 -year WIOA modification
provisions to the Combined State Plan
partner programs included in the plan
in addition to any modification timeline
or interval required by the statute
governing the Combined State Plan
partner program as long as they do not
overwrite those programs' required
timelines. The Departments have
concluded that for any Combined State
Plan partner program included in the
plan with a different planning cycle
from WIOA, States should submit
program -specific modifications that
align with the natural planning cycles
for that specific program, unless the 2 -
year WIOA modification cycle can
accommodate that program' s planning
and modification cycle. For example, if
a State chooses to include CTE programs
under the Carl D. Perkins Career and
Technical Education Act of 2006
Perkins Act), as a part of its Combined
State Plan, the State would submit plan
modifications annually to align with
Perkins' annual State Plan cycle. As
another example, the TANF authorizing
statute requires a State to have
submitted a plan within 27 months of
the end of the first fiscal quarter in order
to receive TANF funds for that fiscal
year. Accordingly, adopting the more
frequent 2 -year WIOA cycle for
modifications should accommodate
TANF' s cycle, allowing a State to make
all changes to each portion of the
Combined State Plan concurrently. The
State must submit such modifications to
the relevant Secretary for that program,
as well as to the Departments of Labor
and Education. Special instructions
apply to UI State Quality Service Plan
and to JVSG as described below. The
Departments have developed a process
for submission of Combined State Plans
that ensures that all relevant Secretaries
receive the plan concurrently and, as
part of this system, the Departments
anticipate that State Plan modifications
will he housed in an accessible format
with that State' s original State Plan. The
State may choose to describe the
planning cycles of the Combined State
Plan partner programs that are included
in the State Plan, and the State also may
describe intentions to submit future
modifications to comply with those
planning cycles; however, in order to
minimize burden, the Departments have
chosen not to require these descriptions
through regulation or through the WIOA
State Plan ICR.
States that include, in their Combined
State Plan, UI programs ( UI Federal -
State programs administered under
State unemployment compensation laws
in accordance with applicable Federal
law) carried out under title III, sec. 302,
of the Social Security Act including
secs. 303( a)( 8) and ( 9) which govern the
expenditure of funds, should submit
their UI State Quality Service Plan
following the cycle, according to UI
State Quality Service Plan Planning and
Reporting Guidelines.
The JVSG programs, carried out under
chapter 41 of title 38 of the U.S. Code,
require both a JVSG State Plan and a
separate annual application for funding.
States that include the JVSG programs
in their Combined State Plan must
submit the JVSG State Plan information
in their Combined State Plan, and
submit their funding applications
annually as required by current
Veterans' Employment and Training
Service guidance.
Comments: One commenter said the
bifurcated nature of the WIOA State
Plans could be adapted to allow non-
WIOA programs to participate in the
strategic portion of the planning
process, even if they cannot fully align
their budgets and operational plans with
a 2-or 4 -year operational plan. A
commenter suggested that the
Departments issue guidance on how
States can incorporate existing and
aligned planned activity with WIOA
funded programs, as well as other
related programs. The commenter
concluded that several agencies that
administer the Combined State Plan
partner programs permitted have plans
that align with partners outside of the
six core programs, and States and local
areas need a method of aligning existing
effective plans. A commenter
recommended adding Social Security
Administration' s Ticket to Work as a
workforce program in the Combined
State Plan. A commenter urged DOL to
work closely with the Department of
Justice to outline additional
recommendations and considerations
within guidance for working specifically
with the Second Chance Act partners
and State Departments of Corrections.
Departments' Response: The
Departments received similar
comments, in response to § 676. 130,
regarding the inclusion of program
partners beyond the core programs and
required one-stop partners in the
development of the Unified Plan. As
already discussed in the context of
Unified Plans in the preamble section
that discusses § 676. 130, the WIOA
State Plan ICR, consistent with secs. 102
and 103 of WIOA, allows States to
include programs beyond the core
programs, required one-stop partners,
and Combined State Plan partner
programs in a Combined State Plan.
This is particularly true in the context
of a discussion of innovative
partnerships with the one-stop delivery
55816 Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
system. These partners and programs
could include human services, faith -
and community-based organizations,
educational institutions, and Federal
programs not listed among the
Combined Plan programs. These
programs may be incorporated into the
strategic portion of the planning
process. As mentioned in the
introduction, the Departments issued
joint guidance to facilitate the inclusion
of innovative partnerships and to foster
alignment across partner programs
outside of WIOA' s core programs. States
also are encouraged to utilize technical
assistance, as the specific dynamics
across program partners within States
will vary. Because sec. 103 of WIOA
provides an exclusive list of Combined
State Plan partner programs, the
Departments do not have the authority
to expand the statutory list of Combined
State Plan partner programs for
inclusion in Combined State Plans.
Comments: One commenter said the
Departments should keep the approval
of the core programs separate from the
approval of Combined State Plan
partner programs, such that the
implementation of what would
otherwise be an approved Unified State
Plan is not impacted or held up by
decisions on Combined State Plan
partner program cycles.
Departments' Response: The
Departments agree with this comment
and have added text to § 676. 143( h) to
clarify that approval or disapproval of
Combined State Plan portions covering
Combined State Plan partner programs
does not impact approval of the
common sections of the plan which
cover the core programs. This change
will be discussed in more detail in the
preamble related to that section. The
portions of the Combined State Plan
related to the core programs are subject
to the same approval requirements
applicable to the Unified State Plan
WIOA sec. 102( c)). The Secretaries of
Labor and Education' s written
determination of approval or
disapproval of the portion of the plan
for the six core programs may be
separate from the written determination
of approval, disapproval, or
completeness of the program -specific
requirements of Combined State Plan
partner programs and activities
described in § 676. 140( d) and included
the Combined State Plan. For example,
if all the common planning elements
and program -specific requirements for
the core programs are met, approval and
funding may proceed regardless of
specific issues that may be identified in
the program -specific sections for any
Combined State Plan partner programs.
Temporary Assistance for Needy
Families
Section 676. 140( d)( 2) specifies that
TANF, authorized under part A of title
IV of the Social Security Act, is a
Combined State Plan partner program
that may be included in the Combined
State Plan.
Comments: One commenter said it
appears that as a Combined State Plan
partner program in a Combined State
Plan TANF would be subject both to its
own current statutory participation rate
requirements and to the six performance
measures specified in WIOA. The
commenter stated that the performance
accountability sections in both WIOA
and the NPRM consistently refer to the
six performance measures in relation to
the core programs only and it is the core
programs' funding alone that is tied to
performance on these measures. The
commenter requested that an exception
be made such that when a State
includes TANF as part of its Combined
State Plan, TANF training and
employment activities not be subject to
WIOA required performance measures.
The commenter requested that TANF
training and employment activities only
be subject to the performance measures
under TANF, the same way that
performance measures for CSBG
employment and training activities are
only those under CSBG.
Departments' Response: The
Departments have reviewed this
comment but did not make a change to
the regulatory text. WIOA sec. 103 does
not require the Combined State Plan
partner programs to report on the WIOA
sec. 116 primary indicators of
performance. WIOA sec. 103( b)( 1) only
requires the Combined State Plan
partner programs, which include TANF,
to include the requirements, if any,
applicable to that program or activity
under the Federal law authorizing the
program or activity. This means those
portions of the plans related to training
and employment. An explicit exemption
for TANF is not required in these
regulations. In referring to CSBG and to
HUD employment and training
activities, WIOA sec. 103( a)( 2) does not
refer to a specific program within those
agencies but to employment and
training activities in general. In contrast,
WIOA sec. 103( a)( 2) refers to TANF as
a whole and does not limit this to the
employment and training activities
under TANF.
Comments: A commenter asked
whether a separate TANF State Plan
would be required even if the State opts
to submit a Combined State Plan. If a
separate TANF State Plan is required,
the commenter asked what the
advantage would be for a TANF entity
in combining their State Plan with the
WIOA Unified Plan. A commenter said
the Departments should explicitly state
that the Governor' s option to determine
that TANF will not be a required one-
stop partner in a State is a separate and
distinct decision from the option of
including TANF in a Combined State
Plan.
Departments' Response: If the State
opts to submit a Combined State Plan
under this rule that includes a TANF
State Plan, the State would not be
required to submit a separate TANF
State Plan to HHS. Instead, HHS will
receive the Combined State Plan under
this rule. If a State submits a Combined
State Plan that is approved, the State is
not required to submit any other plan in
order to receive the funds to operate the
programs covered by that Plan. The
Combined State Plan takes the place of
the individual State Plans for the
Combined State Plan partner programs
that are covered by the plan and
replaces the Unified State Plan. In this
way, the Combined State Plan is meant
to promote integrated planning across
State programs in addition to the
integration among the core programs
that would occur under a Unified State
Plan. While no additional plan is
required, § 676.140(f) stipulates that
each Combined State Plan partner
program included in the Combined
State Plan remains subject to the
applicable program -specific
requirements of the Federal law and
regulations, and any other applicable
legal or program requirements,
governing the implementation and
operation of that program. Finally, a
Governor' s option to determine that
TANF will not be a required one-stop
partner in a State is a separate and
distinct decision from the option of
including TANF in a Combined State
Plan.
Perkins/ Career and Technical Education
Programs
Comments: Several commenters did
not support the use of a Combined State
Plan because, according to these
commenters, the current Federal
funding is essential for local CTE
programs; the current Unified Plan
model is working well by allowing local
control of Perkins funds; the workforce
board should not dictate course
offerings or the curriculum provided;
and the reporting/ performance
requirements for both WIOA and
Perkins would conflict.
Another commenter stated that
schools should have the ability to
develop programs that align with each
other and the resources to support
55817Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
program development. The commenter
said Office of Superintendent of Public
Instruction should be given the control
to direct funds to support CTE program
development and oversee the
implementation of the Programs of
Study.
Departments' Response: The
Departments considered these
comments. States have the option of
including postsecondary programs,
including programs of study described
in sec. 122 ( c) under the Perkins Act, as
a part of their Combined State Plan.
However, even if Perkins postsecondary
programs are included as a part of a
State' s Combined State Plan, there will
be no impact on the amount of Perkins
postsecondary funds that are distributed
at the local level, unless the State
formally amends its Perkins Act State
Plan to change its secondary and
postsecondary split of funds pursuant to
sec. 112( a)( 1) of the Perkins Act. In the
case where there is a change in the split,
the formula established in sec. 132 of
the Perkins Act, or the alternative
formula established in sec. 133 of the
Perkins Act, still applies.
In addition, under WIOA, Local
WDBs cannot dictate course offerings or
curricula. Local recipients retain the
ability to develop programs and align
resources to meet students' needs.
Finally, as discussed above, WIOA sec.
103 does not require the Combined Plan
partner programs to report on the WIOA
sec. 116 primary indicators of
performance. WIOA sec. 103(b)( 1) only
requires the Combined State Plan
partner programs to include the
requirements, if any, applicable to that
program or activity under the Federal
law authorizing the program or activity.
Comments: One commenter stated
that the regulation should account for
WIOA' s statutory requirement that
Combined State Plan partner programs
remain subject to their original
authorizing statutes. This is particularly
important, according to the commenter,
in instances where the Perkins eligible
agency does not fall under the direct
line of authority or control of the
Governor. It is imperative to assure the
Perkins eligible agency that it has full
authority to carry out the
responsibilities under sec. 121 of the
Perkins Act when part of a WIOA
Combined State Plan. The Perkins
eligible agency is ultimately subject to
the Federal government fiscal and
accountability reporting requirements
under Perkins regardless of whether the
Perkins State Plan is separate or part of
a WIOA Combined Plan.
Departments' Response: Reference to
the original authorizing statutes and
their requirements are made throughout
the Joint Rule with respect to Combined
State Plan partner programs included in
Combined State Plans. There is no
intention of removing or minimizing the
authority of the Perkins eligible agency
to carry out its Perkins' responsibilities
under WIOA.
Comments: A commenter made the
following remarks about the submission
of a Perkins State Plan as part of the
Combined State Plan:
The NPRMs do not address a
reconciliation of the two separate and
distinct submission requirements (2 -
year versus annual).
If a State submits the annual
Perkins Plan separate from the
Combined State Plan, the rules are not
clear if the Perkins Plan must be
approved by the State WDB.
The rules require two agencies to
negotiate the level of performance on
the core indicators of WIOA but do not
indicate if the two agencies must
negotiate the level of performance on
the Perkins indicators.
The Perkins State levels of
performance are dependent on local
negotiations and levels of performance
but the NPRMs do not indicate how the
integrity, validity, and reliability of the
local Perkins negotiations can be
retained.
Departments' Response: As discussed
previously, WIOA gives the States the
ability to apply the 2 -year WIOA
modification provisions to the
Combined State Plan partner programs
included in the plan in addition to any
modification timeline or interval
required by the statute governing the
Combined State Plan partner program as
long as they do not overwrite those
programs' required timelines. The
Departments have concluded that for
any Combined State Plan partner
program included in the plan with a
different planning cycle from WIOA,
States should submit program -specific
modifications that align with the natural
planning cycles for that specific
program. Section 676.140(f) stipulates
that each Combined Plan partner
program included in the Combined
State Plan remains subject to the
applicable program -specific
requirements of the Federal law and
regulations, and any other applicable
legal or program requirements,
governing the implementation and
operation of that program.
If a State chooses to include Perkins
as part of its Combined State Plan, the
State will submit Perkins State Plan
modifications annually, consistent with
the Perkins annual State Plan cycle. If
the Perkins State Plan modifications
affect only the administration of Perkins
and have no impact on the Combined
State Plan as a whole or the integration
and administration of the core and
Combined State Plan partner programs,
then such modifications may be
submitted only to the Secretary of
Education consistent with
676. 145( c)( 2). Modifications to a
Perkins State plan that impact the
Combined State Plan as a whole or the
integration and administration of the
core and Combined State Plan partner
programs are subject to the same public
review and comment requirements that
apply to the development of the original
Combined State Plan. Under the
Perkins -specific procedures, hearings
may or may not be required depending
on the specific facts presented.
In response to the commenters who
raised concerns regarding performance
negotiations, the Departments are
clarifying that sec. 103 of WIOA does
not require Combined State Plan partner
programs to report on the primary
indicators of performance in sec. 116 of
WIOA. Section 103( b)( 1) of WIOA only
requires the Combined State Plan
partner programs, which include
Perkins, to include the requirements, if
any, applicable to that program or
activity under the Federal law
authorizing the program or activity.
Perkins program inclusion in a State' s
Combined State Plan will not impact the
annual Perkins performance indicator
negotiation process. See sec. 676. 143( i).
The WIOA State Plan ICR Appendix 1
clarifies what performance information
States must include in the State Plan.
The Departments provided further
instructions through the WIOA Joint
Performance ICR, the WIOA State Plan
ICR, and related joint guidance. The
Departments issued operational
guidance on both performance and State
Plan submission guidelines following
the finalized Performance and WIOA
State Plan ICRs.
Inclusion of Combined State Plan
Programs Not Under Governor' s
Authority
Section 676. 140( e)( 4) requires States
to provide assurance that all of the
entities responsible for planning or
administering an eligible program
described in a Combined State Plan
have a " meaningful opportunity to
review and comment" on all portions of
the plan.
Comments: Several commenters
recommended strengthening the
language in the regulation to ensure that
States give assurances that all of the
entities responsible for planning or
administering a program described in a
Combined State Plan have approved the
inclusion of the programs in a
Combined Plan, especially where such
55818 Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
programs do not fall under the direct
control of a Governor. According to
these commenters, as the language
currently stands, it could be interpreted
as leaving this decision of whether to
include a Combined State Plan partner
program in the Combined State Plan up
to the sole discretion of the Governor.
One commenter stated that, based on
sec. 121 of the Perkins Act, the Perkins
eligible agency should have the
authority to determine whether CTE
programs authorized under the Perkins
Act are included in a State' s Combined
Plan. Section 121 of the Perkins Act
states, in relevant part, that each
shall prepare andeligible agency . . .
submit to the Secretary a State plan
As mentioned above, the Perkins
eligible agency maintains authority to
carry out the responsibilities under sec.
121 of the Perkins Act under a
Combined State Plan.
A few commenters said the Joint
WIOA Final Rule should state the intent
that the TANF program should have a
meaningful influence in all stages of
plan development and be a voting
member of the State WDB.
Departments' Response: The
Departments have concluded that no
change to the regulatory text at
676. 140( e)( 4) is necessary in response
to these comments. The Departments
have modified § 676. 140( e)( 3) to require
States to describe joint planning
methods in the Combined State Plan
among the core programs, and with the
required one-stop partner programs and
other programs and activities included
in the State Plan. The Departments
acknowledge that not all programs
identified in WIOA for potential
inclusion in the Combined State Plan
fall under the purview of the Governor.
For some, the Federal funds go directly
to local entities, such as several HUD
programs administered by Public
Housing Authorities. Others, such as the
Reintegration of Ex -Offenders, are
competitive grants that may be awarded
to community-based organizations.
Perkins funds flow directly to a State
eligible agency by formula. In some
States the Perkins State eligible agency
is an independent agency not under the
authority of the Governor. The
Departments expect the Governor to
work in collaboration with any
Combined State Plan partner programs
included in the plan and with the
agencies that administer those programs
consistent with these regulations and
sec. 103( b)( 3) of WIOA. The
Departments expect that the State' s joint
planning methods across these programs
ensure that the State has full
cooperation from any such programs
and agencies included in the Combined
State Plan. Finally, in response to the
comment that the TANF program
should be a voting member of the State
WDB, State WDB membership
requirements are addressed in 20 CFR
679. 110 ( see DOL WIOA Final Rule).
Other Comments
Comments: Two commenters sought
clarification on the primary indicators
of performance relative to the inclusion
of those partners beyond the core
programs. If a State should choose the
Combined State Plan option, one
commenter asked whether all partners
would be held to the standards of
performance accountability identified in
WIOA.
Departments' Response: WIOA sec.
103 does not require the Combined Plan
partner programs to report on the WIOA
sec. 116 primary indicators of
performance. WIOA sec. 103( b)( 1) only
requires the Combined State Plan
partner programs to include the
requirements, if any, applicable to that
program or activity under the Federal
law authorizing the program or activity.
The WIOA State Plan ICR Appendix 1
clarifies what performance information
States must include in the State Plan.
The Departments provided further
instructions through the WIOA Joint
Performance ICR, the WIOA State Plan
ICR, and related joint guidance.
Comments: A commenter requested
that the Departments ensure that partner
programs will not have to submit
additional or separate standalone plans.
Departments' Response: Partner
programs, except for those carrying out
employment and training activities
carried out under CSBG, HUD programs,
and the Food and Nutrition Act of 2008,
will not be required to submit
additional or separate standalone plans.
Paragraph (h) and new paragraph (i) of
676. 140 explain the additional
submission requirements for CSBG and
HUD programs. Under paragraphs (h)
and (i), the regulation explicitly limits
the Combined Plan requirements for
CSBG and HUD programs to
employment and training activities."
However, these activities are only a
subset of a broad range of antipoverty
activities provided under these two
programs. In the case of CSBG programs,
under § 676.140(h), the State would
submit the remainder of the State Plan
for CSBG ( e.g., those parts that apply to
the other antipoverty activities provided
by CSBG that are not " employment and
training activities") to the Federal
agency that administers the program.
New paragraph ( i) clarifies that, like the
requirements under paragraph (h) for
CSBG programs, only the components of
the individual plans for HUD programs
that pertain to employment and training
should be submitted with the Combined
State Plan. The State must submit any
other required planning documents for
HUD to the Federal agency that
administers the respective program. The
language in this new paragraph creates
a consistent approach for the Combined
State Plan partner programs that WIOA
sec. 103( a) identifies by activities rather
than by a specific program name. This
change also makes the regulatory text
relating to HUD consistent with
instructions in the WIOA State Plan ICR
for submission requirements for
Combined State Plans.
For employment and training
programs and work programs authorized
under the Food and Nutrition Act of
2008, including those under secs.
6( d)(4) and 6( o), the State would
similarly submit to the Departments of
Labor and Education only the
Supplemental Nutrition Assistance
Program Employment and Training
programs ( SNAP E& T). The Departments
declined to regulate an exception for
SNAP E& T because State Plans for
SNAP E& T, as described under 7 CFR
273. 7( c)( 8), are generally not comingled
with the State Plans for the remaining
activities under SNAP.
Comments: A commenter expressed
concern that proposed § 676. 140 does
not require States to identify
populations for Priorities of Service,
though this is required at the local level.
The commenter recommended that the
regulation be revised to require that
States identify populations for priority
of service, and provide explanation of
why those populations are named.
Departments' Response: As discussed
earlier under § 676. 105, in the title I -
specific requirements, the WIOA State
Plan ICR requires the State to address its
policy for ensuring adult program funds
provide a priority in the delivery of
career and training services to
individuals who are low income, public
assistance recipients, or basic skills
deficient. Otherwise, as with the
Unified Plan Requirements, the
Departments have chosen not to regulate
the specifics of State Plan requirements,
as these are explained in comprehensive
detail in the WIOA State Plan ICR.
Section 676. 143 What is the
development, submission, and approval
process for the Combined State Plan?
Section 676. 143 implements WIOA' s
statutory requirements for submitting a
Combined State Plan. These are similar
to the requirements for submitting a
Unified State Plan at § 676. 130, with
added considerations for review and
approval by the Federal agencies that
oversee the Combined State Plan partner
55819Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
programs. The heading for § 676. 143 has
been modified to include the word
development," to more accurately
reflect the content of this section. In
response to comments, discussed
earlier, regarding the role of State WDB,
core programs, required one-stop
partners, and other stakeholders in the
development of the State Plan, the
Departments have made several
revisions to § 676. 143 to mirror the
requirements for Unified Plans related
to coordination, public comment and
input. A new paragraph (b) has been
added to include information similar to
the newly added § 676. 130( c), clarifying
that the Combined State Plan, just as the
Unified State Plan, must be developed
with the assistance of the State WDB
and must be developed in coordination
with administrators with optimum
policy-making authority for the core
programs and required one-stop
partners. New § 676. 143( c)( 1) and ( 2)
have been added to include information
similar to § 676. 130( d)( 1) and (2)
requiring that the State must provide an
opportunity for public comment and
input on the development of the
Combined State Plan prior to its
submission, and that these requirements
apply to the portions of the plan that
cover the core programs. Finally,
676. 143( c)( 3) has been added to
further clarify that the portions of the
Combined State Plan that cover the
Combined State Plan partner programs
are subject to any applicable public
comment requirements for those
programs. Proposed § 676. 143( b) has
been renumbered to § 676. 143( d), and
remaining sections have been
renumbered accordingly. Renumbered
676. 143( e)( 1) has been revised to
clarify that, before the Secretaries of
Labor and Education approve the
Combined State Plan, the VR services
portion of the Combined State Plan
must be approved by the RSA
Commissioner. In response to comments
requesting clarity around Combined
State Plan approval, new § 676. 143( h)
states that the Secretaries of Labor and
Education' s written determination of
approval or disapproval of the portion
of the plan for the six core programs
may be separate from the written
determination of approval, disapproval,
or completeness for program -specific
requirements of Combined State Plan
partner programs at § 676. 140( d). Except
for the changes described here, this
section remains unchanged from that
proposed in the NPRM.
Submission of Combined State Plan
Section 676. 143( d) requires a State to
submit to the Secretaries of Labor and
Education and, if applicable, to the
Secretary of the agency with
responsibility for approving the
program' s plan or for deeming it
complete under the law governing the
program, as part of its Combined State
Plan, any plan, application, form, or any
other similar document that is required
as a condition for the approval of
Federal funding under the applicable
program or activity.
Comments: A couple of commenters
stated that, to reduce the burden on
States, the Secretaries of Labor and
Education should be responsible for
distributing the plans to other
appropriate Federal entities. One of
these commenters said the Secretaries of
Labor and Education may want to
consider taking all of the Combined
State Plans and submitting them as a
batch to the other appropriate Federal
entities.
Departments' Response: The
submission process set forth in WIOA
sec. 103( a)( 1) for Combined State Plans
requires that they be submitted to the
appropriate Secretaries," which differs
from the submission process for the
Unified State Plan set forth in WIOA
sec. 102( a). However, similar to what is
required by § 676. 130( e) for the
submission of Unified State Plans, the
Departments developed a process for the
single electronic submission of
Combined State Plans that allows for
concurrent review of, and immediate
access to, the plans by all the relevant
Federal entities. As discussed in the
introduction, the Departments issued
guidance that explains the submission
process for Combined State Plans,
which is intended to streamline State
submission of plans. No change to the
regulatory text was made in response to
these comments, but the Departments
have issued further guidance regarding
State Plan submission.
Timelines for Review and Approval
Section 676. 143( e) stipulates the
timelines for review and approval by the
Secretary of Labor or Secretary of
Education, or another appropriate
Secretary.
Comments: A couple of commenters
requested clarification on the different
timelines for the review and approval of
the Combined State Plan (90 days for
core programs and 120 days for
Combined State Plan partner programs).
Departments' Response: The
Departments considered these
comments and are implementing the
regulation to reflect the statutory
requirements. As required by WIOA sec.
103( c)( 3), Combined State Plan partner
programs that fall under an authority
other than the Secretary of Labor or
Secretary of Education have an approval
timeline of 120 days, rather than 90
days. This additional time allows for
review and approval of Combined State
Plan partner programs that are
administered outside the Departments
of Education and Labor, such as
programs administered by U.S.
Department of Agriculture, HHS, and
HUD. These are statutory requirements
not subject to regulatory change.
Rehabilitation Services Administration
Approval of Combined State Plans
Comments: Several commenters
requested clarification on whether the
VR portion of a Combined State Plan
must be approved by the RSA
Commissioner prior to the full
Combined State Plan being approved by
the Secretaries of Labor and Education,
as the Unified State Plan process
description explicitly states in
676. 130( g).
Departments' Response: The
Departments considered these
comments and agree that the rule
needed to provide additional
clarification regarding this requirement.
Just as required for Unified State Plans,
the RSA Commissioner must approve
the VR services portion of the Combined
State Plan prior to approval of the full
Combined State Plan by the Secretaries
of Labor and Education. The
Departments have added regulatory text
to clarify this requirement at
676. 143( e)( 1).
Comments: One commenter said
ensuring review by the RSA
Commissioner should be the
responsibility of the Secretaries, not VR
agencies, and asked if this review would
be part of the 90 -day review timeframe.
Departments' Response: The
Departments worked together to ensure
the timely review of all State Plans,
including the VR services portion of
each plan. As discussed under § 676. 130
for Unified Plans, it is not the State VR
agencies' responsibilities to submit and
obtain approval of the VR services
portion of the State Plan prior to
submitting the Combined State Plan to
the Departments. Rather, the entire plan
should be submitted to the Departments
and review by the RSA commissioner
will take place following that
submission as a part of the 90 -day
Federal review of the plan. The
Departments developed a process for
submission of State Plans to ensure that
all Departments, as appropriate, receive
the entire submission concurrently. The
Departments have concluded that the
existing regulatory text and preamble
place adequate emphasis on the timely
concurrent reviews of the plans by the
Departments.
55820 Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
Review, Approval, and Disapproval of
Combined State Plans
Section 676.143(f) provides specifics
on the approval process for Combined
State Plans.
Comments: A few commenters stated
that there appears to be little incentive
for States to pursue a Combined State
Plan. One commenter said States need
assurances that the Departments will
handle the Combined State Plan review
in a manner different from how the
Departments handled the Unified State
Plan review under WIA, which was
largely superficial in nature. The
commenter recommended that the
review process not only enforce
statutory requirements but also consider
the plan in a coordinated, cross -agency
approach. The commenter said States
need additional clarity on how the
Federal agencies will manage the review
process and make approval
determinations, particularly when the
statutes provide mixed or conflicting
direction.
Departments' Response: Although
States only are required, at a minimum,
to submit a Unified State Plan that
encompasses the six core programs
under WIOA, the Departments
encourage States to submit a Combined
State Plan that includes additional
Combined State Plan partner programs
as described at § 676. 140. Development
of a Combined State Plan allows for
coordination across multiple Federal
programs, cross -program strategic
planning, increased alignment among
State programs, and improved service
integration, which provides a wider
range of coordinated and streamlined
services to the customer. WIOA offers
an expanded opportunity for States to
create and implement a shared vision
and strategy for the public workforce
system within the State. The
Departments have added language to
676.143 in paragraphs (e)( 1) and (h) to
further clarify the review process for
Combined State Plans. Review of
Combined State Plans will take into
consideration the strategic coordination,
program alignment, integration, and
cross -agency joint planning that is
reflected in the Combined Plan. The
Departments worked together to create a
robust review process across all partner
agencies and consider this review
process to be integral to effective joint
planning and implementation. The
Departments have added regulatory text
at § 676. 143( h) to clarify that the
Secretaries of Labor and Education' s
written determination of approval or
disapproval of the portion of the plan
for the six core programs may be
separate from the written determination
of approval, disapproval, or
completeness of the program -specific
requirements of Combined State Plan
partner programs and activities
included in the Combined State Plan.
Comments: One commenter requested
guidance ( 1) that allows States to
develop a Combined State Plan without
the threat of a loss of funds if elements
of the individual programs are not
specifically identified, and ( 2) on how
accountability metrics and reporting
requirements for those programs
included in the plan will not be a
disincentive for inclusion. A commenter
said it is not clear what benefit exists for
the State or local Perkins recipients to
attempt to address indicators that are
not pertinent to their purpose of
operation as outlined in State regulation
as well as the " Federal Perkins
regulation." The commenter said if the
Combined State Plan partner programs
are not required to report on the WIOA
indicators of performance, the benefit of
a Combined State Plan is not clear.
Departments' Response: Regarding
concerns about funding, the joint
submission, or joint review process of
the Combined State Plans will not
impact funding because the
Departments developed a process to
ensure Combined State Plans are
reviewed in a coordinated and timely
manner across agencies. The Combined
State Plan review process is further
explained at § 676. 143. Combined State
Plan partner programs are not subject to
the six common indicators for
performance under WIOA, although
they may be subject to the same or
similar indicators under their own
authorizing statute or under State law.
Regardless of whether required
indicators are identical, States will find
that public workforce development
system customers can benefit from the
results of developing a Combined State
Plan that fosters program integration
and alignment and optimal use of
resources. The Departments' worked
together to implement a robust review
process across all partner agencies and
consider this review process to be
integral to effective joint planning and
implementation. Performance issues
have been addressed through the WIOA
State Plan ICR, the WIOA Joint
Performance ICR, and related joint
guidance.
Comments: One commenter said it is
unclear how the rejection of one part of
a Combined State Plan would affect
funding for the other programs. A
commenter stated that the regulation
implies that disapproval by any
Secretary of their respective program
will result in disapproval of the
Combined State Plan as a whole, which
provides incentive to submit a Unified
State Plan (instead of a Combined State
Plan). Similarly, another commenter
said disapproval of a section of the plan
pertaining to a program not considered
to be a core program should not result
in the disapproval of the entire plan.
Another commenter requested
additional guidance on the process to
follow if the RSA Commissioner does
not approve the VR portion of the State
Plan.
Departments' Response: Per
676. 143( h), disapproval of a section of
a Combined State Plan pertaining to a
Combined State Plan partner program
does not impact the approval for the
portions of the Combined State Plan that
apply to the core programs. In the
process mentioned above, the common
planning elements and program -specific
elements of Combined State Plans are
reviewed concurrently across the
Departments of Labor and Education
and other relevant agencies, with the
approval determination by RSA
occurring first, and with additional time
allowed for specific Combined State
Plan sections that fall within the
purview of U. S. Department of
Agriculture, HUD, or HHS. A
determination regarding approval or
disapproval for the common elements
and the core programs may be issued
separately from the approval
determination for program -specific
requirements for Combined State Plan
partner programs, including those that
allow 120 days for review. The
Departments have added a new
676. 143( h) to clarify that the
Secretaries of Labor and Education' s
written determination of approval or
disapproval of the portion of the plan
for the six core programs may be
separate from the written determination
of approval, disapproval, or
completeness for program -specific
requirements of Combined State Plan
partner programs specified in
676. 140( d) in the Combined State
Plan. However, the portions of the
Combined State Plans that cover the
core programs must be approved by all
core program agencies.
Special Rule for Perkins Act Programs
Comments: Several commenters
referred to § 676.143(f) in the NPRM,
which has been renumbered to
676. 143( i) in the Joint WIOA Final
Rule, the special regulation for programs
authorized by the Perkins Act, which
directs the State to come to an
agreement with the Secretary of
Education regarding State performance
measures. One commenter requested
further clarification as to what
accountability measures would take
55821Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
precedence under an agreement
between the Secretary of Education and
a State. The commenter stated that the
Departments should specify that when a
State chooses to include Perkins in a
Combined State Plan, the State is
required to include the totality of the
Perkins State Plan in the Combined
State Plan and cannot break off the parts
relevant only to postsecondary CTE.
Departments' Response: WIOA sec.
103 does not subject the Combined State
Plan partner programs to the WIOA sec.
116 primary indicators of performance.
WIOA sec. 103( b)( 1) only requires the
Combined State Plan partner programs,
which include Perkins programs, to
include the requirements, if any,
applicable to that program or activity
under the Federal law authorizing the
program or activity. The WIOA State
Plan ICR Appendix 1 further clarifies
what performance information States
must include in the State Plan. As
discussed in § 676. 140 above, if a State
chooses to include postsecondary CTE
programs under the Perkins Act as a
part of its Combined State Plan, the
State would submit the entirety of the
State Plan, including any annual
revisions, pertaining to the CTE
programs authorized under the Perkins
Act. In addition, the State would submit
plan modifications annually to align
with Perkins' annual State Plan cycle,
consistent with §676. 145.
Section 676. 145 What are the
requirements for modifications of the
Combined State Plan?
Section 676. 145 specifies
requirements for modifying a Combined
State Plan. Sections 676. 145( a)( 1)
through (3) have been added to mirror
the core program modification
requirements specified for Unified State
Plans in § 676. 135( b). Section
676. 145( a)( 1) through (3) outline three
instances in which a modification for
the core programs is required. These
instances include: (1) At the conclusion
of the first 2 -year period of a 4 -year
State Plan, ( 2) when changes in Federal
or State law substantially affect the
plan' s implementation, and ( 3) when
there are substantial changes to the
State' s workforce investment system.
The Departments revised § 676. 145( a)( 3)
to clarify that modifications to the
Combined State Plans are required
when States modify their negotiated
levels of performance. This clarification
was made for consistency with the
changes to part 677 on the performance
accountability system. The Departments
have added a clarifying edit to
676. 145( c)( 1) to explain that States
have discretion to apply the plan
modification requirements for core
programs to Combined State Plan
partner programs so long as it is
consistent with any other modification
requirements for that program. The
Departments have incorporated
proposed § 676. 145( f) into
676. 145( c)( 2) to clarify these
provisions to address commenters'
confusion in this area, and deleted
paragraph (f).The Departments also
have made technical edits at
676. 145( d). Except for the changes
described here, this section remains
substantively the same as that proposed
in the NPRM.
Timeframe for Combined State Plan
Modifications
Comments: A couple of commenters
said the Departments should consider
emphasizing the opportunity for States
to submit Combined Plan modifications
following submission of the initial plan
to ensure that Combined Plan partner
programs continue to be engaged in the
planning and implementation process.
Some commenters said the Federal
agencies responsible for the Combined
Plan partner programs should accept the
Combined State Plan on the timeline
outlined in WIOA and not prescribe
more frequent updates or different
timeframes for modifications and
renewals. In addition, the commenters
said the submission deadlines must
align. These commenters also said the
Departments should issue final
guidance early enough that there is
sufficient time to negotiate the levels of
performance for State performance
accountability measures before
submission deadline.
Departments' Response: The
Departments agree that modifications
following submission of the initial plan
are useful to ensure that Combined State
Plan partner programs continue to be
engaged in the planning and
implementation process. Sections
676. 135 and 676. 145 enable States to
continue to modify and improve the
planning process of both core and
Combined State Plan partner programs
through Unified and Combined State
Plans. The Departments are not
prescribing more frequent updates
beyond what is required under WIOA
timeframes. However, the Departments
have revised § 676. 145( a) to clarify the
circumstances under which a Combined
State Plan must be modified for core
programs, which are the same
modification requirements that apply
under Unified State Plans. The States
have the discretion to apply these
modification requirements to Combined
State Plan partner programs or
activities. The Departments have added
regulatory text at § 676. 145( c)( 1) to
clarify that a State may apply these
modification requirements to Combined
State Plan partner programs, as long as
this is consistent with any other
modification requirements for those
specific programs. As discussed under
676. 140, the Departments do not have
the authority to change the planning
requirements, including submission
deadlines, that are not under WIOA' s
jurisdiction. The Departments have
provided additional clarity on the
review and approval process through
joint planning guidelines.
Combined State Plan Modification
Requirements
Unlike § 676. 135, which addresses
modifications of Unified State Plans,
proposed § 676. 145, which addressed
modifications for Combined State Plans,
did not require modification of a plan
when there are " substantial changes" to
a State' s workforce investment system.
Comments: The Departments received
comments requesting that language
similar to that in § 676.135(b)(2) and (3),
requiring States to submit modifications
when there are " substantial changes,"
be added to the section pertaining to
Combined State Plan modifications.
Departments' Response: The
Departments considered these
comments and agree. The Departments
have revised proposed § 676. 145( a) by
adding new paragraphs ( a)( 2) and (a)( 3)
that are essentially identical to
676.135(b)(2) and (3) to clarify that the
same modification requirements that
apply to the Unified Plan also apply to
the portions of the Combined Plan
covering the core programs. States are
required to submit a modification for
the portions of the Combined Plan
covering the core programs when ( 1)
changes in Federal or State law or
policy substantially affect the strategies,
goals, and priorities upon which the
Combined State Plan is based, and (2)
when there are changes in the statewide
vision, strategies, policies, State
negotiated levels of performance, the
methodology used to determine local
allocation of funds, reorganizations
which change the working relationship
with system employees, changes in
organizational responsibilities, changes
to the membership structure of the State
WDB or alternative entity, and similar
substantial changes to the State' s
workforce investment system. Under
WIOA sec. 103( b)( 1), it is at the
discretion of the State to decide whether
to apply these modification
requirements to Combined State Plan
partner programs or activities, as long as
this is consistent with any other
modification requirements for those
specific programs. The Departments
55822 Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
have added language at § 676. 145( c)( 1)
to clarify this distinction.
Public Comment on Combined Plan
Modifications
In the NPRM, the Departments sought
comments on how to streamline the
public review and comment process for
Combined State Plan modifications. The
Departments further sought comments
in the NPRM on whether it is advisable
to limit the requirement for public
comment on plan modifications to
significant or substantial modifications
to the common planning elements and,
if so, how the Departments might define
significant" or " substantial changes."
Comments: One commenter indicated
that historically, in-person meetings are
poorly attended, so comments in
relation to § 676. 145 should be allowed
via other methods, such as surveys,
webinars, video conferences, and phone
conferences. Another commenter said
public review should not exceed 30
days.
Some commenters said the
Departments should limit the comment
process under § 676. 145 to significant or
substantial modifications, such as
substantive change to service delivery or
participating partners, adding or
removing a Combined State Plan partner
program, or discretionary changes
within a program that would directly
affect the provision of services and its
collaboration with other programs
excluding programmatic changes
required due to audit findings or
sanctions). One commenter said the
Departments should allow public
comment on the shared planning
elements to streamline this process
significantly, particularly for States in
which core program agencies have
different governance and review
processes.
Departments' Response: In the Joint
WIOA Final Rule, the Departments have
not included requirements related to the
timing, method, or other specifics
related to public review and comment.
The Departments leave much of the
process related to public review and
comment to the discretion of the State
so long as regulatory requirements for
public comment are met. If, based on
the regulatory categories described in
676. 145, a Combined State Plan
modification is required, such a plan
modification is subject to the
requirements for comment as described
in § 676. 145( d). As described in
676. 145( d), modifications to the
Combined State Plan are subject to the
same public review and comment
requirements that apply to the
development of the original Combined
State Plan as described in § 676. 143( c)
except that, if the modification,
amendment, or revision affects the
administration of a particular Combined
State Plan partner program and has no
impact on the Combined State Plan as
a whole or the integration and
administration of the core and other
Combined State Plan partner programs
at the State level, a State may comply
instead with the procedures and
requirements applicable to the
particular Combined State Plan partner
program. The Departments have made a
technical edit to § 676. 145( c)( 2)( ii) for
clarity by adding the word " other"
before Combined State Plan partner
programs in the phrase " has no impact
on the Combined State Plan as a whole
or the integration and administration of
the core and Combined State Plan
partner programs at the State level." The
Combined State Plan partner programs
being referred to here are those other
than the program that is the focus of the
modification. States may determine, at
their discretion, if these same plan
modification requirements apply to
Combined State Plan partner programs
included in the Combined State Plan.
States can further use their own
discretion to provide a reasonable
period of time for public comment.
Many State laws also require a
minimum number of days for public
comment. Likewise, States may
determine the best way to streamline the
public comment process while ensuring
that regulatory requirements for public
comment are met.
In addition to the regulatory text
changes discussed above, various non -
substantive changes have been made for
purposes of correcting typographical
errors and improving clarity that have
not been necessary to note elsewhere.
B. Performance Accountability Under
Title I ofthe Workforce Innovation and
Opportunity Act (20 CFR Part 677;34
CFR Part 361, Subpart E; 34 CFR Part
463, Subpart I)
1. Introduction
Section 116 of WIOA establishes
performance accountability indicators
and performance reporting requirements
to assess the effectiveness of States and
local areas in achieving positive
outcomes for individuals served by the
workforce development system' s six
core programs described in sec.
116(b)( 3)( A)(ii) of WIOA. These six core
programs are the adult, dislocated
worker, and youth programs under title
I of WIOA; AEFLA program under
WIOA title II; Employment Service
program authorized under the Wagner-
Peyser Act, as amended by WIOA title
III (Wagner-Peyser Act Employment
Service program); and VR program
authorized under title I of the
Rehabilitation Act of 1973, as amended
by WIOA title IV.
The performance accountability
system established in WIOA subtitle A
System Alignment") in sec. 116
requires that the performance
accountability requirements apply
across all six core programs with few
exceptions. As such, the six core
programs have an historic opportunity
to align performance -related definitions,
streamline performance indicators,
integrate reporting, and ensure
comparable data collection and
reporting across all the core programs,
while also implementing program -
specific requirements.
Through this Joint WIOA Final Rule,
the Departments are laying the
foundation for a performance
accountability system that serves all
core programs and their targeted
populations in a manner that is
customer -focused and that supports an
integrated service design and delivery
model. In addition, WIOA requires
additional DOL -administered title I
programs, specifically Job Corps, Native
American programs, the Migrant and
Seasonal Farmworker programs, and the
YouthBuild program, to comply with
the same primary indicators as the core
programs ( see 20 CFR part 686 and 20
CFR part 684 of the DOL WIOA Final
Rule published elsewhere in this issue
of the Federal Register). The inclusion
of these additional DOL -administered
programs into the common performance
accountability system will better align
both the core programs and other
education and training programs across
the public workforce system. Further,
DOL is including other workforce
programs under its purview in this
performance -related streamlining effort,
including the JVSG program as
authorized by the Jobs for Veterans Act
and other appropriate formula and
competitive grant programs.
In the section -by -section discussions
of each performance accountability
regulatory provision below, the heading
references the DOL CFR section number.
The ED is establishing in this Joint
WIOA Final Rule identical provisions at
34 CFR part 361, subpart E ( under its
State VR program regulations) and at 34
CFR part 463, subpart I (under a new
CFR part for AEFLA regulations).
Although for purposes of brevity, the
section -by -section discussions for each
provision appear only once— in
conjunction with the DOL section
number—the discussions nevertheless
constitute the Departments' collective
explanation and rationale for each
regulatory provision. When the
55823Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
regulations are published in the CFR,
these joint performance regulations will
appear in each of the CFR parts
identified above.
2. Definitions ( 20 CFR 677. 150; 34 CFR
361. 150; 34 CFR 463. 150)
Section 677. 150 What definitions
apply to Workforce Innovation and
Opportunity Act performance
accountability provisions?
Section 677.150 defines " participant,"
reportable individual," " exit," and
State," which are key performance -
related terms applicable to all six core
programs for implementation of the
performance accountability system
under sec. 116 of WIOA and part 677 of
these joint regulations. The definition of
participant" has been revised, as
explained below, to distinguish clearly
between participants and reportable
individuals. The definitions of
reportable individual" and " exit" have
been revised as explained below. The
Departments also have added a
definition of " State," which includes
the outlying areas for purposes of part
677, other than in regard to sanctions or
the statistical adjustment model. These
definitions establish the foundation of
an integrated performance
accountability system and support
clarity and alignment of performance
metrics and comparability among the
programs, States, and outlying areas.
Definition of "Participant"
677. 150( a))
Comments: Numerous commenters
responded to the Departments'
solicitations for input on the joint
NPRM regarding the proposed
definitions of "participant," " reportable
individual," and " exit." While several
commenters supported the definition of
participant" generally, many
commenters raised multiple concerns
regarding the distinction between self-
service and staff -assisted service. A
common concern was that the proposed
definition of " participant" excludes
self-service only individuals, which
conflicts with WIOA' s goal of leveraging
technology to improve service delivery.
Some commenters expressed concerns
about the term " staff -assisted service,"
stating that the term should either be
defined or removed because it is critical
to understanding the precise distinction
between a " participant" and a
reportable individual." Several
commenters asserted that the
Departments should remove " staff -
assisted service" from the definition of
participant" because it is not defined
in WIOA or regulations and can be
misleading when providing upfront
assessment services to youth. Other
commenters encouraged the
Departments to define " staff -assisted
service" in order to provide
clarification. One commenter indicated
that the regulatory definition of
participant," for purposes of the title I
youth program, should reflect policy
positions articulated by the Departments
in the Joint WIOA NPRM' s preamble.
Commenters also suggested additional
terms and concepts that could be
defined, including providing definitions
for " qualifying services," " facilitated
self-service," and " career and training
services." One commenter asserted that
the Departments should issue timely
guidance with additional definitions
and clarifications or allow States to
continue using definitions contained in
WIA.
Departments' Response: The
Departments agree that it is critical that
these definitions be clear in order to
ensure compliant data collection and
reporting. Section 677. 150( a) provides a
definition of "participant" that applies
to all six core programs because the
primary performance indicators set forth
in sec. 116( b)( 2)( A)(i) of WIOA
specifically base performance
calculations on the participants in each
of the core programs. The definition of
participant" establishes a common
point at which an individual is
meaningfully engaged in a core program
and thus, it is appropriate for the person
to be included in the primary indicators
of performance. In the NPRM, the
Departments attempted to distinguish
staff -assisted services," which required
more meaningful interaction with a core
program, from " self-services" and
information -only services and activities,
where individuals engaged in these
activities that require minimal
interaction with the programs, by which
the Departments mean minimal
resources are spent on their behalf in
most cases. While individuals who
receive only self-service or information -
only services and activities do not
satisfy the definition of " participant,"
these individuals are considered
reportable individuals" as defined in
677.150(b) and discussed in more
detail below.
The Departments considered each of
the suggested revisions to the proposed
definition of "participant" and have
modified § 677. 150 to clarify the
application of this definition to
requirements under WIOA. The
Departments made the following
changes to the definition of
participant" in § 677. 150( a).
In § 677. 150( a), the Departments
replaced the phrase " staff -assisted
services" with " services other than
those described in § 677. 150( a)( 3)." In
so doing, the Departments eliminate the
confusion of what is meant by " staff -
assisted services" and make clear that
individuals who receive the services
described in § 677. 150( a)( 3) will not be
deemed to be " participants" for
purposes of the performance
accountability system requirements
under part 677, but rather will
constitute a " reportable individual"
under § 677.150(b).
The Departments provided additional
clarification in renumbered
677. 150( a)( 3) to describe what does
and does not constitute self-service and
information -only services and activities.
In so doing, the Departments have
eliminated the confusion noted by
commenters. Specifically, the revisions
contained in § 677. 150( a)( 3) clarify that
the difference between reportable
individual and participant is the point
when a reportable individual uses
services other than those identified in
renumbered § 677. 150( a)( 3). The
Departments clarify what is meant by
self-service and information -only
services and activities, thereby avoiding
use of the term " staff -assisted services"
in this regulation, which raised
concerns among commenters.
Because the Departments appreciate
the concerns raised by commenters and
recognize the changing landscape and
advances in service delivery and design,
the Departments added
677. 150( a)( 3)( ii)(A) to describe self-
service. The Departments recognize that
not all electronic technologies are self-
service and that individuals engaged in
this type of service could potentially
meet the definition of " participant." For
example, there may be some services
that provide robust levels of assistance
in assessing a person' s skills and
matching that person to a job that are
provided using electronic technologies
that involve one-on-one interaction with
a one-stop center staff member, such as
an Internet chat room, or interactive
technology, such as video conferencing,
that would result in the individual
becoming a participant. Additionally,
the Departments acknowledge how fast
technology evolves and new technology
emerges that could be used by States
and local areas to maximize available
resources and better serve job seekers,
workers, and employers. The
Departments will continue to assess the
field and emerging innovative
technologies that may provide more
cost-effective services and inform the
workforce system of such developments,
and their allowable uses, through
program guidance.
The Departments are continuing to
examine staff -assisted virtual service
55824 Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
delivery in order to determine its
potential. Paragraph ( a)( 3)( ii)(B) of
677. 150 clarifies that virtual services
providing support above an individual' s
independent job-or information -seeking
efforts would not qualify as self-service,
thus resulting in the individual
becoming a " participant.".
The Departments have concluded that
the following revisions to
677. 150( a)( 3), described in more detail
below, add the clarity requested by
commenters:
Self-service occurs when individuals
independently access the workforce
development system information and
activities with very little to no staff
assistance. This can he done in either a
physical location, such as a one-stop
center resource room or partner agency,
or remotely via the use of electronic
technologies, with very little to no staff
assistance.
Importantly, if a service is virtual
service it is not automatically a self-
service. As many commenters pointed
out, there have been great strides made
in the area of virtual service design and
delivery allowing for staff to provide
support and services through a variety
of in-person and virtual platforms. For
example, there may be some services
that are provided using electronic
technologies that involve one-on-one
interaction with a one-stop center staff
member or interactive technology, such
as video conferencing, that would
trigger participation. Furthermore,
individuals who receive self-service or
information -only services and activities
can still be participants if they receive
services other than self-service or
information -only activities.
Information -only services or activities
are activities or services that provide
readily available information that does
not require an assessment by a staff
member of the individual' s skills,
education, or career objectives. In a
public workforce development setting,
information activities or services may
include both self-service basic career
services and staff -assisted basic career
services. Both are designed to inform
and educate an individual about the
labor market and to enable an
individual to identify his or her
employment strengths, weaknesses, and
range of appropriate services. However,
basic career services that require
significant staff involvement are not
considered information -only services or
activities.
Applying the above guidance to
determining when a reportable
individual satisfies the definition of a
participant," an individual is a
reportable individual, but not a
participant, when a staff member
provides the individual with readily
available information that does not
require an assessment of the
individual' s skills, education, or career
objectives, because the individual is a
recipient of information -only services or
activities. Such information could
include labor market trends, the
unemployment rate, businesses that are
hiring or reducing their workforce,
information on high growth industries,
occupations that are in demand, and
referrals other than referrals to
employment. Information -only services
or activities also occur when a staff
member provides the individual with
information and instructions on how to
access the variety of other services
available in the one-stop center,
including tools in the resource room.
Significant staff involvement that
would result in an individual qualifying
as a participant includes a staff
member' s assessment of an individual' s
skills, education, or career objectives in
order to achieve any of the following:
Assist individuals in deciding on
appropriate next steps in the search for
employment, training, and related
services, including job referral;
Assist individuals in assessing their
personal barriers to employment; or
Assist individuals in accessing
other related services necessary to
enhance their employability and
individual employment related needs.
The Departments also added a new
677. 150( a)( 2) to align the regulatory
text definition of "participant," for
purposes of the title I youth program,
with the intent expressed in the NPRM.
New § 677. 150( a)( 2) clarifies the
definition of a " participant" for
purposes of the WIOA title I youth
program.
The Departments did not add a
definition of " staff -assisted service," as
suggested by commenters, because the
revisions to § 677. 150( a) described
above resulted in the removal of the
term from the regulatory text. In
addition, the Departments declined to
add the recommended definitions of
qualifying services" or " facilitated self-
services," because the modifications
made to the definition of
participant"—particularly at
677. 150( a)( 3) regarding clarifications
of self-service and information -only
services or activities—will address the
needs of commenters. In addition, the
Departments consider additional
recommended definitions to fall within
the scope of either the WIOA Joint
Performance ICR (which identify
performance calculations, definitions,
and reporting parameters) or operating
and programmatic guidance.
The Departments did not add
definitions of " career services" and
training services" because WIOA sec.
134(c)( 2) and (3) define " career
services" and " training services,"
respectively, and these terms are further
defined at § 678. 430 (" What are career
services?") in the Joint WIOA Final Rule
and 20 CFR 680. 200 (" What are training
services for adult and dislocated
workers?"), in the DOL WIOA Final
Rule, both of which are published in
this issue of the Federal Register. The
WIOA Joint Performance ICR contains
further specifications regarding the
collection and reporting of career and
training services under this section. The
Departments intend to issue further
clarifying programmatic guidance
regarding these and other performance -
related definitions in order to assist
States and outlying areas in
implementing them.
Comments: A commenter
acknowledged the problems associated
with outcome evaluations of
participants who do not go through an
intake process but stated that the
performance metrics should give credit
for the investment of resources and staff
required to maintain effective self-
service systems. Another commenter
asserted that self-service individuals
should be included in the definition of
participant" to allow States to fully
convey the impact and return on
investment for this large customer
group.
Departments' Response: The
Departments recognize commenters'
concerns about the resources required to
maintain effective self-service systems.
Although performance calculations on
the primary indicators of performance
are limited to individuals who meet the
definition of participant and do not
include individuals who only use the
self-service system, other information
that captures resources and costs
associated with those individuals served
by the public workforce system at the
self-service or information -only levels is
collected and reported in the State
annual performance reports under
677. 160, and additional elements are
required through associated ICRs
published by the Departments.
The Departments expect that because
information about reportable
individuals, including those who access
self-service and information -only
services or activities, will be included in
the State annual performance reports
and associated WIOA Joint Performance
ICR or Department -specific ICRs, such
investments by States and local areas
will be recognized. The Departments
note that the changes in the regulatory
text maintain the policy expressed by
55825Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
the Departments in the NPRM.
Individuals who only use the self-
service system or who receive
information -only services or activities
are not defined as " participants." No
change to the regulatory text was made
in response to these comments.
Comments: A commenter opposed the
exclusion of self-service individuals in
the definition of "participant," asserting
that it creates a bias against rural areas
where one-stop centers are less
accessible.
Conversely, a number of other
commenters stated that individuals
receiving self-service and information -
only services should not be considered
participants for performance purposes,
stating that participation should not
begin until an individual receives a
staff -assisted service. A commenter
agreed that self-service individuals
should be excluded from the definition
of " participant," but suggested that a
performance analysis be conducted to
assess the impact of exclusion of self-
service results on performance.
Departments' Response: The
Departments recognize commenters'
concerns about the delivery of services
in rural areas and recognize the
importance of leveraging virtual services
technology to improve the delivery of
services in such areas. As discussed
above, the Departments do not consider
all services provided virtually to be
self-service" and reiterate that such
activities, even when delivered
virtually, can trigger participation and
subsequent inclusion in performance
calculations. The Departments
developed the proposed definitions in
order to maintain a level of rigor and
accountability that is consistently
applied across programs, while also
providing a platform that is flexible
enough to accommodate changes in
service delivery design and
advancements in technology. As stated
above, no changes to the regulatory text
regarding individuals who only use the
self-service system were made in
response to comments, as these
individuals are not considered
participants" for purposes of the
performance accountability system.
With regard to the recommendation
that a performance analysis be
conducted to assess the impact of
exclusion of self-service and
information -only services or activities,
the Departments analyzed a number of
factors before proposing the definition
of participant, including the relative
impact of self-service exclusion and
inclusion, and concluded that exclusion
of such services had little to no impact
on performance outcomes. Therefore, as
stated above, the Departments decline to
change the regulation' s definition of
participants based on these comments.
With regard to the recommendation
that participation begin only when an
individual receives a staff -assisted
service, the Departments have
concluded that to define such a precise
attachment point in regulation would
prevent the performance accountability
system from being able to adapt and
account for all the services that the
programs are providing. For example, an
individual could receive staff -assisted
services in the form of an assessment in
the WIOA youth program, or in the form
of fewer than 12 contact hours of
AEFLA services, yet still appropriately
be excluded from the definition of a
participant.
Comments: A few commenters
suggested that self-service participants
should be included in Wagner-Peyser
Act employment indicators or measured
separately.
Departments' Response: The
Departments considered collection and
reporting burdens of doing so and did
not revise the regulatory text to require
additional collection and reporting on
reportable individuals beyond the
associated counts and information
already required under the WIOA Joint
Performance ICR. However, States
should feel free to conduct additional
analysis beyond what is required to be
submitted to the Departments, such as
an analysis on outcome of Wagner-
Peyser Act self-service individuals. No
change to the regulatory text was made
in response to these comments.
Comments: Several commenters
remarked that, under the NPRM, a youth
receiving an assessment could be
considered as receiving a staff -assisted
service and therefore be considered a
participant." These commenters
further stated that this proposed
regulation would conflict with the
discussion in the NPRM, which had
proposed that a " participant" for
performance calculation purposes of the
WIOA youth program, would be a
reportable individual" who was
determined eligible, received an
assessment, and received a program
element. These commenters asserted
that an assessment alone should not be
considered a staff -assisted service, and
that the regulation should be revised to
conform to the language in the preamble
of the NPRM. Another commenter
expressed similar concerns, stating that
an assessment alone for any individual
in any program should not trigger
participation.
Departments' Response: The
Departments agree with the numerous
commenters who asserted the NPRM
text regarding the definition of
participant," as applied to the WIOA
title I youth programs, could potentially
conflict with the stated intent in the
preamble. The Departments, therefore,
revised the regulatory text by adding a
new § 677. 150( a)( 2), which reflects the
intent stated in the NPRM preamble. In
so doing, the Departments have made
clear that a WIOA program youth is not
considered a " participant," and
subsequently included in performance
calculations, until the youth has been
determined eligible, received an
objective assessment, developed an
individual service strategy, and received
1 of the 14 youth program elements ( as
outlined in WIOA sec. 129( c)( 2)). The
Departments have concluded that this
change is consistent with the general
definition of a " participant" in
677. 150( a), as well as the application
of the definition to all core programs.
This differs from the NPRM only by
additionally requiring the youth
participant to have satisfied the
applicable program requirement for
provision of services, including
eligibility determination, objective
assessment, and the development of an
individual service strategy, as required
under WIOA sec. 129( c)( 1)( B).
Comments: A few commenters
suggested that co -enrollees be counted
as participants in all of the core
programs from which they are receiving
services. A few commenters discussed
the benefits of co -enrollment,
particularly for youth populations, and
supported the idea that eligible
individuals may be co -enrolled in title
I youth services and title II adult
education programs. One commenter
requested clarification regarding how to
account for individuals enrolled in
multiple core programs. Another
commenter remarked that differences
among programs and uncertainty about
reporting co -enrollees create a
disincentive for co -enrollment.
Departments' Response: The
Departments recognize the value of co -
enrollment across the core programs and
greatly encourage efforts by the core
programs in States to establish the data
infrastructure and partnerships
necessary to facilitate seamless
enrollment in one or more core
programs under WIOA. The
Departments encourage co -enrollment
between those programs that are
required partners under WIOA, such as
the Jobs for Veterans State Grant
Programs, the Trade Adjustment
Assistance (TAA) programs, and others
as outlined in sec. 121( b)( 1)( B) of WIOA.
However, the Departments have
concluded there is no need for revision
to the regulations to address these
comments since WIOA sec. 116(d)( 2)( I)
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and § 677. 160( a)( 1) require core
programs to report the number of
participants who are enrolled in more
than one of the programs described in
WIOA sec. 116(b)( 3)( A)(ii),
disaggregated by each subpopulation of
such individuals. Therefore, individuals
who are co -enrolled in more than one
core program and who meet the
definition of participant under each
respective program must be included in
each respective program' s performance
calculations.
These calculations, as proposed under
the WIOA Joint Performance ICR, would
be done independent of the participant' s
participation in another core program
unless a State opted to implement such
policies for co -enrollment that allows
for a common participation or exit date
based on entering any of the core
programs. Under WIA title I, some
States maintained similar policies. For
example, under WIA title I, in those
cases where an individual was initially
enrolled in the Wagner-Peyser Act
program and subsequently received
services under another DOL -
administered program, the participation
date for each program was the same and
the receipt of a program' s service was
recorded as the date of receipt for first
service as named. Such practices are
allowed to continue under WIOA.
Irrespective of the dates for
participation and exit, each program
would account for the participants in its
program, and would be accountable for
the outcomes of such participants in
their reporting. For example, a title I
youth participant who is co -enrolled in
a title II AEFLA program and who also
meets the definition of participant
under title II, would be included in the
State performance report for both title I
youth and the AEFLA program under
title II. No change to the regulatory text
was made in response to these
comments.
Comments: Several commenters
addressed the applicability of the
participant" definition to the VR
program. A few of these commenters
noted that the proposed definition of
participant" would inflate the number
of individuals exiting the VR program
without achieving an employment
outcome. Of these, one commenter
stated it is not clear how the definitions
of " participant," " exit," and the
calculation of the performance
indicators that rely on quarterly wage
data are being operationalized in the
proposed VR ICR for the RSA -911,
particularly as it relates to calculating
the denominator, and numerator.
Specifically, this commenter said that it
appeared that quarterly earnings and
Federal Employer Identification
Numbers (FEINs) only should be
supplied for those participants who
achieve competitive integrated
employment. As a result, this
commenter stated this would mean a
significant number of VR participants
would be included in the denominator
but would be automatically excluded
from the numerator for performance
calculations if they did not achieve a
competitive integrated employment
outcome, even though they received
significant VR services before exiting
the VR program. This commenter was
concerned that this approach would not
provide a consistent and equitable
comparison across all core programs
since the definition of " participant"
means an individual who received staff -
assisted services. For example, this
commenter asserted that WIOA title I
and title III (Wagner-Peyser Act
Employment Service) staff -assisted
services may be quite limited compared
to the intensive and sustained services
provided to VR customers under an
individualized plan for employment
IPE), the development of which
requires substantial VR counselor
investment and is in itself a service that
may improve employment prospects.
Therefore, this commenter
recommended that the denominator be
likewise limited to those participants
who achieved competitive integrated
employment or, in the alternative,
require quarterly earnings and FEINs for
all participants, not just those who
achieved competitive integrated
employment. This commenter
recommended that RSA provide the
specific formula for calculating
performance indicators and provide a
comment period. A few commenters
stated that the proposed definition of
participant" would exclude a
potentially large number of students
with disabilities who receive pre-
employment transition services under
the VR program. Another commenter
urged the Departments to provide
guidance regarding the application of
the " participant" definition to the VR
program.
Departments' Response: The
Departments agree that the definition of
participant," for purposes of the VR
program, will include both those
individuals who exit the VR program
after achieving an employment outcome
as well as those individuals who exit
without achieving an employment
outcome. While the Departments
understand that this calculation is a
departure from what was done by VR
agencies under prior 34 CFR 361. 84( c),
677. 150( a)( 1) of the Joint WIOA Final
Rule is consistent with the use of the
term " participant" throughout sec. 116
of WIOA and its application to the
primary performance indicators set forth
in sec. 116(b)( 2)( A)(i) of WIOA.
Moreover, the definition of
participant," for purposes of the VR
program, at § 677. 150( a)( 1) is consistent
with the definition as applied to all core
programs in § 677. 150( a). Specifically,
the definition of "participant" is broad
enough to account for programmatic
differences but narrow enough to
capture the same type of individual
with respect to each of the core
programs. As the commenter noted,
Wagner-Peyser Act services are often
characterized as self-services and
information -only activities. In
accordance with §677.150( a)( 3),
individuals receiving those kinds of
services would not meet the definition
of " participant" and, thus, there would
be no comparison in the performance
calculations between these individuals
and participants of the VR program.
However, individuals receiving Wagner-
Peyser Act services that go beyond self-
services or information -only activities
would meet the definition of
participant" in § 677. 150( a). As such,
there would be comparability between
this participant and a participant of the
VR program. The Departments recognize
that VR services are provided in a much
more intensive manner and for a more
extended period of time than those
provided by the Wagner-Peyser Act
program. Such differences will be
reflected in the performance levels
established for each of the core
programs.
With respect to performance
calculations, the three employment-
related indicators measure the
percentage of participants who are
employed in the second and fourth
quarters after exit, as well as their
median earnings in the second quarter
after exit. The Departments provide
further guidance regarding the
performance calculations in the WIOA
Joint Performance ICR.
The Departments also agree that
students with disabilities who receive
pre-employment transition services
without having applied, or been
determined eligible, for the VR program
would not satisfy the definition of
participant" as set forth in
677. 150( a)( 1), but rather would be
tracked and reported as " reportable
individuals," as defined in § 677.150(b).
However, if a student with a disability
applies and is determined eligible for
the VR program and develops an IPE
that includes the provision of pre-
employment transition services or any
other VR service, such student would
satisfy the definition of " participant" as
55827Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
set forth in § 677. 150( a)( 1) and would be
included in the performance
calculations as such. The Departments
have provided additional guidance
regarding the reporting of " participants"
in the WIOA Joint Performance ICR. No
change was made to the regulation at
677. 150( a)( 1) in response to the
comments.
Comments: Several commenters urged
the Departments to adopt consistent
definitions regarding point of
enrollment across titles triggered by
engagement in program activity, not just
initial assessment. They expressed
particular concern for the youth
program.
Departments' Response: The
definition of " participant" takes into
consideration the unique purposes and
characteristics of each program and the
ways in which an individual may
access, and ultimately engage in,
services in each of the core programs,
thereby focusing on the established
common point in service design and
delivery that an individual reaches
regardless of the program. The
Departments concluded that it was
sufficient to revise the definition of
participant" for purposes of the WIOA
youth program.
Comments: Several commenters
sought clarification concerning the
distinction between the data collected
for reportable individuals and
participants, particularly with regard to
whether they are included in
performance calculations for the
primary indicators of performance.
Departments' Response: While the
Departments will collect and track
information on reportable individuals as
well as participants, the Departments
currently do not intend to require
reporting of outcomes of reportable
individuals. The Departments will
notify States via the ICR process of any
collection and reporting requirements
for reportable individuals. No change to
the regulatory text was made in
response to these comments.
Comments: A commenter asserted
that older individuals with barriers to
employment may require priority in
receiving staff -assisted services, since
these individuals are not as likely to use
self-service tools.
Departments' Response: The
Departments recognize the unique
challenges faced by the different
populations with barriers to
employment that affect both their access
to and utilization of services within the
public workforce system. WIOA
provides for meaningful access to
individuals seeking services, including
individuals with multiple barriers to
employment. The regulation no longer
refers to staff -assisted services.
Comments: Several commenters
stated that while the definition of
participant" is well suited for WIOA
performance accountability purposes, it
is not suitable for many education
programs and postsecondary students.
These commenters stated that
postsecondary students may participate
in the workforce system in ways that are
not captured in the definition. For
instance, students may take courses and
determine a degree pathway but never
officially enroll in a program of study.
Departments' Response: The
definition of "participant" establishes a
common point at which an individual is
meaningfully engaged in a core
program. This takes into consideration
the unique purposes and characteristics
of each program and the ways in which
an individual may access, and
ultimately engage in, services in each of
these programs. For example, an
individual who accesses postsecondary
education through the VR program, as
set forth in title IV of WIOA, would
meet the definition of participant at the
point at which the eligible individual
has an approved and signed IPE.
Likewise, an individual accessing a
career pathway program funded through
title II would meet the definition of
participant once the individual has
completed at least 12 contact hours.
Therefore, because programmatic
differences are already accounted for,
including differences regarding
educational programs, the Departments
have made no change to this Joint WIOA
Final Rule regarding the definition of
participant" as applied to an
educational program. The Departments
note that further clarity is provided
through the WIOA Joint Performance
ICR. No change to the regulatory text
was made in response to these
comments.
Comments: A few commenters stated
that the definition of " participant" is
problematic when applied to all
individuals in a program of study for the
purpose of the eligible training provider
performance report.
Departments' Response: The
Departments recognize the need for
clarity on terms as they apply to the
eligible training provider (ETP)
performance reports applicable to the
adult and dislocated worker programs.
There is further discussion on this and
associated issues in the preamble of
677. 230 below. The Departments do
not consider all individuals in a
program of study through an ETP as
falling within the definition of
participants as defined under § 677. 150.
No change to the regulatory text was
made in response to these comments.
Comments: Although the Departments
received no comments specifically on
proposed § 677. 150( a)( 4), which
requires that programs must include
participants in their performance
calculations, the Departments received
comments with respect to other areas of
performance accountability that
highlighted the intersection between
WIOA core programs and their partner
programs. Some commenters addressed
the general applicability of these
provisions to the national programs
authorized under title I, particularly
with regard to those programs identified
in WIOA sec. 121( b)( 1)( B).
Departments' Response: The
Departments reiterate that sec. 116
applies to other programs, including the
national programs and the partner
programs identified in WIOA sec.
121( b)( 1)( B), to the extent provided for
by provisions of WIOA pertaining to
those programs and their authorizing
statutes and implementing regulations.
In some instances, these statutes or
regulations invoke the performance
accountability provisions of WIOA sec.
116. In other instances, a program has
its own statutory or regulatory
performance provisions that apply to
the program. In the case of ETP
programs authorized at 20 CFR part 680
and reported through § 677. 230 of these
joint regulations, the definitions under
677. 150 only apply to those
individuals who are WIOA program
participants who received training from
an ETP. Where § 677. 230 outlines
required reporting for all individuals in
a program of study, these definitions
under § 677. 150 do not apply. Further
direction regarding the terms,
calculations, and reporting is provided
and discussed in the WIOA Joint
Performance ICR. No change to the
regulatory text was made in response to
these comments.
Because of WIOA sec. 134' s unique
eligibility requirements, the
Departments do not consider
individuals who receive incumbent
worker training to be participants
required for inclusion in the WIOA
performance indicator calculations.
WIOA sec. 134(d)(4) requires the Local
WDB to determine if an employer is
eligible to have its employees receive
incumbent worker training; there is no
separate determination of the eligibility
of any particular employee to receive
incumbent worker training.
Definition of "Reportable Individual"
677. 150(b))
Section 677. 150( b) defines " reportable
individual" as an individual who has
55828 Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
taken action that demonstrates an intent
to use program services and who meets
specific program criteria for reporting,
which may include the provision of
identifying information, the use of a
self-service system, or receipt of
information -only services or activities.
This approach requires counting as a
reportable individual" those who use
the self-service system, or who receive
only information -only services or
activities, as well as those who receive
other services that may occur prior to an
individual meeting the definition of
participant" in § 677. 150( a).
A key difference between " reportable
individuals" and " participants" is that
reportable individuals are not included
in performance calculations for primary
indicators of performance. Furthermore,
there currently is no requirement for the
collection and reporting of outcome data
for reportable individuals, but the
Departments may propose an amended
ICR through an additional PRA notice
and comment period, to require such
collections and reporting in the future if
determined to be appropriate. The
Departments intend to issue more
detailed guidance on the tracking and
reporting of reportable individuals
under WIOA through the WIOA Joint
Performance ICR, Department -specific
ICRs, guidance, and technical
assistance.
The Departments revised § 677.150(b)
by deleting the word " core" to clarify
that the definition of a " reportable
individual" is not limited to core
programs, as had appeared in proposed
677. 150(b). With this change, a
reportable individual" is one who has
taken action that demonstrates intent to
use program services and who meets
specific reporting criteria of the
program. The Departments also revised
677. 150(b) to emphasize that the listed
examples of actions taken by a reporting
individual (i.e., providing identifying
information, using the self-service
system, or receiving information -only
services or activities) are neither
exhaustive nor required. An individual
may be properly treated as a reportable
individual without having taken all of
the actions identified at § 677. 150( b).
Similarly, an individual may take action
demonstrating an intent to use program
services by meeting specific program
reporting criteria other than those
identified at § 677.150(b).
Comments: Of the commenters who
remarked on the proposed definition of
reportable individual," most expressed
support. Multiple commenters
applauded the Departments for
establishing a definition that is broad
enough to cover students with
disabilities who access pre-employment
transition services under the VR
program but do not subsequently apply
for VR services.
Departments' Response: The
Departments will continue to consider
further clarification that can be
provided in program guidance, the
WIOA Joint Performance ICR, and
Department -specific ICRs that support
alignment and consistency of
performance definitions across all
programs and States. The final
regulations for the VR program, which
are published elsewhere in this issue of
the Federal Register, contain specific
provisions regarding the application of
this definition as applied to students
with disabilities receiving pre-
employment transition services under
the VR program.
Comments: A few commenters
asserted that receipt of staff -assisted
services should align with the type of
activity, not the level of engagement of
one-stop center staff.
Departments' Response: As discussed
above with regard to the definition of a
participant," the Departments
modified § 677. 150( a), particularly by
adding § 677. 150( a)( 3), to explain that
the point at which a person is a
participant is when the person moves
beyond self-service or information -only
services or activities. In the NPRM, the
Departments considered receipt of
staff -assisted services" to be the most
common point across the core programs
to define the transition to being a
participant. However, in response to
comments, the Departments modified
the definition of participant to eliminate
the use of the term " staff -assisted
services" thereby aligning the
definitions of "participant" and
reportable individual" and clarifying
the progression from " reportable
individual" to " participant."
Comments: One commenter proposed
that the appropriate point of receipt of
staff -assisted services should be when
initial assessment and eligibility
documentation is complete.
Departments' Response: As noted
above, the definition of " participant" no
longer incorporates a reference to " staff -
assisted" services, but the definition
continues to require that the individual
has received certain services after
having satisfied all programmatic
requirements for the provision of
services, such as eligibility
determination. The Departments note
that the definition does not explicitly
require completion of an initial
assessment, but it does require
satisfaction of all applicable
programmatic requirements—which
may include an initial assessment or an
eligibility determination. No change to
the regulatory text was made in
response to these comments.
Comments: One commenter suggested
that "reportable individuals," should be
those individuals who have a signed
and approved IEP.
Departments' Response: The
Departments decline to adopt the
recommendation because to do so
would be inconsistent with the
distinctions between the definitions of
participant" and " reportable
individual." The Departments plan to
provide more detailed guidance on the
tracking and reporting of reportable
individuals under WIOA through the
WIOA Joint Performance ICR,
Department -specific ICRs, guidance, and
technical assistance.
Comments: Several commenters
sought clarification concerning the
proposed definition of "reportable
individual." Of these, a few commenters
requested that the Departments clarify
whether a pretest is required for
individuals in the AEFLA program in
order to be considered reportable.
Departments' Response: A reportable
individual is an individual who has
taken action that demonstrates an intent
to use program services and meets the
specific criteria of the program. Further
explanation of this definition is
available through the WIOA Joint
Performance ICR. A pretest has no
bearing on the status of an individual
being a participant or a reportable
individual.
Comments: A few commenters stated
that a clearer description of the point at
which an individual becomes
reportable" would enhance
comparability among States. Multiple
commenters suggested that individuals
become " reportable" when an
individual provides identifying
information. A commenter remarked
that it is unclear how agencies should
track reportable individuals. This
commenter stated that an individual
should not be considered reportable
without providing identifying
information to enable tracking.
Departments' Response: The
Departments note that the regulations
simply require the reporting of
reportable individuals. Someone can be
considered a reportable individual
without providing identifying
information. The Departments intend to
issue further program guidance to aid
States in implementing the requirement
to report on " reportable individuals."
No change to the regulatory text was
made in response to these comments.
Comments: A commenter thought that
the term " reportable individual" may
not be easily understood by the general
55829Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
public and suggested " customer" as an
alternative.
Departments' Response: The
Departments have concluded that
customer" would not be an appropriate
term for these purposes as all
individuals who are served through a
program would be considered
customers. The terms in § 677. 150 are
consistent with the purposes outlined in
this section and with the requirements
of sec. 116 of WIOA. No change to the
regulatory text was made in response to
these comments.
Comments: A commenter inquired as
to whether an individual could first be
tracked as a participant and then
tracked as a reportable individual if the
person exited the program after
receiving services and was subsequently
determined to be ineligible.
Departments' Response: To do as the
commenter suggests would be
inconsistent with the definitions of
participant" and " reportable
individual" at § 677. 150( a) and (b). To
be clear, an individual is a " participant"
if he or she is a " reportable individual"
who has satisfied programmatic
requirements for the receipt of services,
such as eligibility determination, and
has received services that go beyond
self-service or information -only services
or activities. Therefore, once an
individual crosses the threshold from
reportable individual" to " participant"
by receiving such services, this does not
change by virtue of the fact that the
individual eventually exits the program
because he or she is later determined
ineligible. Neither the definition of
participant" nor " reportable
individual" contain requirements
related to the individual' s exit from the
program. Those requirements are set
forth in the definition of " exit" at
677. 150( c), discussed in more detail
below. The Departments will provide
further guidance regarding the reporting
of participants and reportable
individuals in the WIOA Joint
Performance ICR and Department -
specific ICRs, as well as guidance and
technical assistance. No change to the
regulatory text was made in response to
these comments.
Definition of "Exit" (§ 677.150(c))
Section 677. 150( c) defines the term
exit" for purposes of the performance
accountability system for the core
programs under WIOA, as well as
applicable non-core programs as
described through regulation or
guidance. Several of the primary
indicators of performance require
measuring participants' progress after
they have exited from the program.
Generally for core programs, except
for the VR program, " exit" is the last
date of service. The last date of service
means the individual has not received
any services for 90 days and no future
services are planned. For the purpose of
this definition, " services" do not
include self-service, information -only
services or activities, or follow-up
services. Therefore, as set forth in
677. 150( c)( 1)( i), in order to determine
whether an individual has exited, States
will retroactively determine if 90 days
have passed with no further services
provided and no further services
scheduled.
The definition of " exit" at
677. 150( c)( 2) for the VR program is
similar to that in § 677. 150( c)( 1) in that
it marks the point at which the
individual is no longer engaged with the
program and there is no ongoing
relationship between the individual and
the program. However, because of
specific programmatic requirements
between the VR program and other core
programs, it was essential that the
definition of " exit" clarify when the
individual' s relationship with the VR
program ends. Under the VR program,
an individual is determined to have
exited the program on the date the
individual' s case is closed in
accordance with VR program
requirements.
Even with this programmatic
distinction, the calculations are
essentially the same as with the other
core programs because in all instances
the " exit" count captures all persons
who are no longer active participants in
any of the core programs. In addition,
for purposes of the VR program, the
Departments exclude from the
definition of " exit" those individuals
who have achieved supported
employment outcomes at subminimum
wages. This provision is necessary to
implement WIOA' s heightened
emphasis on competitive integrated
employment. There are no substantive
changes to § 677. 150( c)( 2).
Comments: The Departments received
numerous comments, in response to
both the NPRM and the proposed WIOA
Joint Performance ICR, regarding
whether an individual would be
counted more than once in a program
year if he or she met the definitions of
participant" and " exit" more than once
in that same program year. The majority
of these commenters opposed the
Departments' position, set forth in the
proposed WIOA Joint Performance ICR,
which was that an individual only
would count once in a program year.
Departments' Response: The
Departments note that under WIA, DOL
counted as an " exit" from its programs
for performance accountability purposes
each time in a program year a
participant exited from a program,
regardless of whether the participant
exited more than once in that program
year. This was referred to as calculating
on a " period of participation" basis.
Thus, the same individual could be
counted as more than one " participant"
and as having more than one " exit" in
that same program year for the
performance accountability
calculations. Although States reported
individuals similarly for the VR
program, States reported an individual
only once in a program year under the
AEFLA program, regardless of whether
the individual would meet the
definitions of "participant" and " exit,"
more than once in a program year.
The NPRM was silent as to whether
participants" and " exits" should count
more than once in the same program
year. However, the Departments
proposed a different approach in the
proposed WIOA Joint Performance ICR
published on July 22, 2015 at 80 FR
43474. In the proposed WIOA Joint
Performance ICR, the Departments
proposed counting each individual once
per program year regardless of how
many times an individual met the
definitions of "participant" and " exit"
in § 677. 150 within that same program
year.
After consideration, the Departments
agree with the concerns raised by
commenters. In response to those
comments, the Departments will
include in the performance calculations
each time a participant exits from a
program during a program year, even
though this could result in such a
person being counted as more than one
participant. This calculation method for
performance accountability purposes
maintains the reporting approach
historically used by some programs, as
discussed above, and by linking a set of
services or interventions to outcomes for
each exit during a program year,
strengthens accountability.
However, the Departments will
require States to provide unique
identifiers for each individual
participant" so that the Departments
will be able to calculate the number of
unique participants in each core
program during a program year. The
Departments will provide technical
assistance and guidance to States,
including the WIOA Joint Performance
ICR, as they take the necessary steps to
modify their systems and processes to
comply with these instructions.
Comments: Many commenters
provided input regarding the proposed
definition of " exit" and responded to
the Departments' request for comments
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on the costs and benefits of taking either
a program exit approach or a common
exit approach. A number of commenters
expressed support for utilizing a
common exit in order to support career
pathways and cross -program
participation that would benefit
participants. One commenter supported
the use of a common exit, specifically
phased in over a 4 -year period.
Conversely, other commenters opposed
the use of a common exit and stated that
the Departments should maintain
program exits. Commenters cited
numerous reasons for maintaining
program exits including that: (1)
Program exits are preferable to comply
with sec. 504 of WIOA, which requires
States to simplify and reduce reporting
burdens; ( 2) States should be permitted
to choose whether to use a program exit
or a common exit, and indicate their
selection in the Unified or Combined
State Plan; ( 3) States should have the
option to use integrated periods of
participation with common program
exit dates for some or all core programs;
and (4) a common exit would be
problematic if the services provided by
multiple programs are sequential.
Departments' Response: Common
Measures policies that included the use
of common exit as a reporting structure
were developed by ETA in 2005 for use
in title I programs under WIA as an
acknowledgment that integrated
reporting was key to integrated case
management. The efforts to promote the
use of a common exit across WIOA title
I and Wagner-Peyser Act Employment
Service programs have significantly
increased the use of common exit
policies across States.
The Departments have concluded that
continuing common exit policies would
emphasize the importance of an
individual receiving and completing all
program services necessary to ensure a
successful attachment to the labor
market. The Departments also recognize
that the use of a common exit is
dependent on the ability of States to
exchange data effectively and efficiently
across core programs in order to
determine outcomes for each of the
programs. The Departments considered
each of the commenters' concerns and
suggestions with regard to the proposed
definition of exit and have revised the
definition by adding § 677. 150( c)( 3) to
allow WIOA title I and Wagner-Peyser
Act Employment Service (title III)
programs to utilize a common exit
policy. The decision to allow a common
exit date for WIOA title I and Wagner-
Peyser Act Employment Service
programs— and not for the AEFLA and
VR programs under WIOA titles II and
IV, respectively—was based on a
number of factors. In particular, under
WIA and continuing under WIOA, DOL
encouraged co -enrollment between the
title I and Wagner-Peyser Act
Employment Service programs resulting
in many states developing a common
exit policy or co -enrollment strategies
which DOL does not seek to disrupt.
The ED will explore the feasibility of the
use of a common exit policy for its title
II and VR programs.
The concept of integrated case
management and common exit has
extended beyond WIOA title I core
programs and Wagner-Peyser Act
Employment Service programs to their
DOL partner programs, such as the TAA
program and the JVSG program.
Paragraph (c)( 3)( i) of §677.150 provides
that where a State has implemented a
common exit policy, the policy may
extend to those required partner
programs administered by DOL. As
such, DOL encourages States to
implement common exit policies
consistent with these joint regulations.
Since 2009, co -enrolling TAA
participants with WIOA title I and
Wagner-Peyser Act Employment Service
programs has continued to provide
participants supportive services, such as
childcare and local transportation costs,
that are not available under TAA.
Further, due to the variable geography
of TAA certified worker groups, WIOA
title I program services and Wagner-
Peyser Act Employment Service are
often essential in providing prompt
assessments and follow up services that
complement the more substantial
training and other services funded
under TAA.
Similarly, the Veterans Employment
and Training Service worked to align its
programs with WIOA as a key partner
program. Currently, JVSG and Wagner-
Peyser Act Employment Service have a
common exit in multiple States. This
ensures that program participants who
may be co -enrolled exit all programs at
the same point, and are measured and
tracked for employment outcomes based
on the same point. This approach is
aligned with the idea that DOL' s one-
stop center programs offer seamless
services to participants and that, despite
referral to or from partner programs,
employment outcomes are not measured
until services are complete. The
modifications to the definition of exit in
this Joint WIOA Final Rule allow for
these practices to continue and also
allow States the flexibility to implement
and move forward with existing
common exit policies for programs
administered by DOL.
Comments: A few commenters cited
the challenge of matching and
exchanging data across agencies.
Multiple commenters recommended
implementing a research study to
examine the use of the common exit,
rather than codifying this requirement
in regulation. One commenter stated
that a common exit would make it very
difficult to track and conduct follow up
services. A commenter stated that the
cost of reporting a common exit is
prohibitive for that State. A commenter
remarked that a common exit would he
the costliest option.
Departments' Response: The
Departments recognize the challenges
raised by commenters with regard to
infrastructure and integration of data
systems that would be required under a
common exit policy. Under the current
regulation, the States have the
discretion to choose to adopt a common
exit policy for DOL -administered
programs. The Departments
acknowledge that certain States are at
different stages and may vary in their
approaches and ability to adopt a
common exit across multiple programs.
The Departments also note, however,
that common exit supports a customer -
centric design that allows programs to
leverage co -enrollment for individuals
who are eligible for, and need, multiple
services that cross program lines
without penalizing programs that may
have to delay outcomes for those
individuals referred to or co -enrolled in
a partner program. Further, common
exit policies have allowed smaller pilot,
discretionary, or partner programs to
access data and outcomes at a level that
would not be available through their
grant or program alone.
With WIOA' s focus on integration,
common exit is a natural progression
where appropriate infrastructure, and
integrated data systems exist across
programs. The DOL envisions full
implementation of a common exit across
the States for the DOL core programs.
The DOL understands this is a long-term
goal and intends to support States from
where they are at in terms of capacity
and structure towards achieving this
goal. With this in mind, the
Departments will require the States to
develop a plan for implementing a
common exit policy and will require
States to share that plan with the
Departments. The Departments
anticipate modifying the requirements
for State Plans through the information
collection request process and will
require the States to share their plans for
implementing a common exit policy
through the State Plan and will also
require the States to conduct an
examination and analysis of their
capacity and structures that would
support a common exit policy for the
DOL core programs under title I and the
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Wagner-Peyser Act Employment Service
program. This will allow DOL to
support the States as they move towards
implementing a common exit policy.
The Departments will continue to
work with State and Local WDBs, one-
stop center operators, and partners to
achieve an integrated data system for
the core programs and other programs to
ensure interoperability and
standardized collection of program and
participant information, particularly for
those States that have a common exit
policy. Paragraph (c)( 3) of § 677. 150
allows for the use and implementation
of common exit policies for DOL
administered -programs. The
Departments encourage the use of
common exit for DOL -administered
programs, but do not currently require
its immediate implementation, due
partially to the commenters' concerns
about potential difficulties and costs in
implementing common exit. The
Departments have concluded that this
approach is responsive to both
commenters who supported common
exit as well as to commenters who
supported program exits and
appropriately allows States flexibility to
choose to continue their use of common
exit or to plan for the full
implementation of common exit as a
policy for WIOA title I and Wagner-
Peyser Act Employment Service
programs. Additionally the Departments
will seek to collect information through
the appropriate information collection
vehicles on existing common exit
policies, the programs included in those
common exit policies, and their impacts
on program design and outcomes.
Comments: Many commenters
supported the use of common exit in
theory, but expressed reservations about
the implementation of a common exit to
title I youth programs, asserting that the
use of a common exit would delay
reporting of multiple performance
indicators, harming the performance of
the youth programs. These commenters
suggested that the Departments
encourage co -enrollment without a
common exit, provide instruction for
the identification in the participant
record of individuals who are co -
enrolled, and afford local programs the
flexibility to use a program -specific exit
or a common exit.
Departments' Response: In response
to the concerns raised about common
exit and its effect on the performance of
WIOA youth programs, predominately
concerning the short-term or self-service
nature of some programs as opposed to
other programs providing longer-term or
more intensive services, the
Departments have clarified that the
definition of " participant" at
677.150( a)( 3)(ii) and (iii) excludes
individuals who receive only " self-
service" or " information -only services
or activities." As noted above, States—
not individual programs within a
State— are afforded the flexibility to use
program -specific exit or common exit. It
does not appear feasible or preferable
for individual programs within a State
to choose the type of exit to implement.
Comments: A number of commenters
made additional suggestions specific to
youth programs. One commenter stated
that title I youth programs should have
a defined end date, at which point
participants should be considered to
have exited, rather than waiting 90 days.
Another commenter stated that local
programs currently believe that no title
I youth funds may be spent on youth
once they exit, and requested
clarification concerning follow-up
services for youth conducted after an
individual has exited. In addition,
several commenters suggested that a
hold status be maintained for youth who
are not receiving services due to
documented hardships. These
commenters stated that a hold status
would avoid counting these individuals
as having exited if they reengage after
the 90 -day window.
Departments' Response: While the
Departments understand the concerns
raised by commenters, the Departments
decline to modify the definition of
exit" at § 677. 150( c) with regard to the
90 -day period of no services. This
definition maintains consistency with
the definition of exit applied across
other programs. Paragraph (c)( 1)( i) of
677. 150 requires that 90 days of no
services ( except for self-service,
information -only services or activities,
and follow-up services) must have
elapsed, and no future services, other
than follow-up services, may be planned
in order for a participant to satisfy the
definition of " exit."
Conversely, § 677. 150( c)( 3) adds
flexibility for States that have or are
pursuing common exit policies and
strategies for their programs under
WIOA titles I and III (Wagner-Peyser Act
Employment Service) as well as other
required partner programs that are
administered by DOL. The clarification
in this Final Rule that self-service and
follow-up services do not delay exit
should allay the commenters' concerns
regarding delayed reporting. By
definition, follow-up services are
provided to youth following exit and as
a result, title I youth funds may be spent
on participants once they exit in order
to provide such follow-up services.
For the sake of clarification, such
expenditures of title I youth funds on
participants for follow up services after
exit do not result in delaying an
individual' s exit from the program.
Section 681. 580 ( see DOL WIOA Final
Rule published elsewhere in this issue
of the Federal Register) clarifies which
youth formula program elements may be
provided during follow-up.
Additionally, DOL will issue guidance
on providing effective follow-up
services for the programs it administers.
Although the Departments are not
implementing a " hold status" as
suggested by the commenters, DOL will
clarify through guidance the
circumstances under which a " gap in
service" may be appropriate in order to
delay exit for those States that
implement a common exit strategy for
DOL -administered programs.
Comments: Numerous commenters
responded to the Departments'
solicitation for comments regarding the
effect of self-service activities on a
participant' s exit date. Most of the
commenters asserted that self-service
should not be used to delay the date of
exit or count as re -enrollment in a
program. However, other commenters
asserted that individuals who access
self-service activities should continue to
qualify as participants because the use
of these services indicates that
participants have not completed their
search for employment. One commenter
suggested that self-service participants
should continue to be tracked as
reportable individuals.
Departments' Response: The
Departments acknowledge commenters'
recommendation that self-service not be
used to delay the exit date or qualify as
re -enrollment. With regard to
individuals who continue to use self-
service, the Departments note that
individuals access self-service tools for
a variety of reasons, but the decision to
retain an exclusion of self-service from
the definition of "participant" at
677. 150( a)( 3)( ii) is consistent with the
decision in the NPRM to establish a
uniform program attachment point in
service delivery and design from which
to compare programs. See the extensive
discussion regarding the definition of
participant" and § 677. 150( a), above.
Comments: Commenters raised a
number of questions regarding various
aspects of the proposed definition of
exit," including requests for
clarification regarding whether exit
means exiting a core program or exiting
all WIOA services.
Departments' Response: Whether
exit" means from a specific program or
a common exit from multiple programs
depends on whether a State has
implemented a common exit policy for
DOL -administered programs. As
discussed in more detail above, the
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Departments have modified the
definition of exit at § 677. 150( c)( 3) to
allow WIOA title I and Wagner-Peyser
Act Employment Service programs to
apply a common exit policy. States that
lack a common exit policy across title I
and Wagner-Peyser Act Employment
Service programs will be required to
conduct an assessment and develop a
plan towards implementing a common
exit policy. Additionally, States that
retain or develop a common exit policy
across title I and Wagner-Peyser Act
Employment Service programs may
extend such a policy to DOL -
administered required partner programs
identified in WIOA sec. 121( b)( 1)( B).
Further, States with common exit
policies that include WIOA title I core
programs and Wagner-Peyser Act
Employment Service programs should
ensure those policies align with the
criteria in § 677. 150( c).
Comments: Several commenters
expressed concerns regarding the
definition of " exit" for purposes of the
VR program since individuals served by
VR typically require lengthier service
delivery and follow-up activities than
the other core programs. A few
commenters also stated that a common
exit would better protect individuals in
the VR program from exiting the
program before receiving the services
they need.
Departments' Response: As other
commenters have noted, the VR
program typically requires lengthier
period of service delivery than the other
core programs. While not common, it is
possible for a single VR participant to
receive services for 10 years, and service
durations of 3 to 5 years are not
unusual. If there were a single exit, it
would mean that other programs would
not be able to exit these co -enrollees
until the VR case was closed. The VR
program is not included under the
common exit provision at this time,
because if they were incorporated into
the common exit provision, programs
under other WIOA titles would not be
able to report exit achievements until
the time of the VR closure, no matter
how much time had elapsed since
participation in those programs. With
the VR program having a separate
closure process, individuals are
shielded from the entreaties of other
programs that may wish to close the
case. The ED will explore the feasibility
of the use of a common exit policy for
its title II and VR programs. No change
to the regulatory text was made in
response to these comments.
Comments: Some commenters
expressed support for expanding the
proposed definition of " exit" to
reference the termination of staff -
assisted services.
Departments' Response: The
definition of "participant" at
677. 150( a) no longer references the
term " staff -assisted" services due to
concerns raised by many commenters
about the confusion such term raises.
Section 677. 150( a) now describes the
services as being those other than self-
service and information -only services or
activities, which are described further in
677. 150( a)( 3). See the response to
comments related to the definition of
participant" above regarding the
Departments' elimination of the term
staff -assisted" services from the
definition; therefore, it is not necessary
to expand the use of that term with
regard to the definition of " exit" as the
commenters suggest.
Comments: Several commenters
remarked on the application of the
definition of " exit" to education
programs, noting that the definition
does not account for a transfer between
institutions or participants not taking a
class during the summer term that could
exceed the 90 -day timeframe.
Departments' Response: Section
677. 150( c)( 1)( i) makes clear that a
participant " exits" a program only if 90
days of no services have elapsed and
there are no future services planned.
Please see the analysis of comments
regarding § 677. 230, below, for further
discussion of these and other terms as
they apply to eligible training providers.
Comments: Some commenters
suggested the Departments revise the
definition of " exit" at § 677. 150( c) to
lengthen the proposed 90 -day period of
no services to 120 days, citing the
challenges of sporadic engagement in
services in which youth cycle in and out
of services. In such cases, service delays
can extend an exit beyond the 90 days.
One commenter suggested doubling the
90 -day window to 180 days. Other
commenters suggested shortening the
90 -day period.
Departments' Response: Although the
Departments recognize that out-of-
school youth, among other examples,
may be a population that is difficult to
engage in continuous services, the
Departments have concluded that it is
important to maintain consistency
across all core programs regarding the
definition of exit. The 90 -day period has
a basis in historical application. Under
WIA, the DOL -administered programs
and the AEFLA program under title II
used 90 days of no service as a
benchmark for determining when
services had ended. Similarly, prior to
WIOA the VR program closed an
individual' s service record after services
had ended and the individual had
maintained employment for 90 days.
The Departments have not revised the
definition of " exit" at § 677. 150( c) since
lengthening the timeframe would delay
outcomes for indicators that are already
lagged behind the actual time period of
exit, such as employment-related
primary indicators that measure a
participant' s employment at the second
and fourth quarters after exit and the
median earnings of a participant in the
second quarter after exit. The
Departments have concluded that the
90 -day period of no service strikes the
appropriate balance for knowing how
the programs are performing while
providing enough time to account for
sporadic participation. No change to the
regulatory text was made in response to
these comments.
Comments: Some commenters
expressed support for retaining the
current " neutral" exits. Other
commenters urged the Departments to
adopt a more flexible exit policy that
would allow participants who were
negative" exits due to loss of contact
with the program, to reengage and
positively exit if performance outcomes
are achieved.
Departments' Response: There are a
number of reasons why individuals exit
from the programs in which they are
enrolled. The current definition of
exit" allows for performance
accountability that can uniformly
translate across programs, while also
retaining critical programmatic
differences and the policy -based
flexibility for States in their program
engagement and design. The
Departments have concluded that the
definitions in § 677. 150, including that
for " exit" at § 677. 150( c), are consistent
with their applicability to the
performance accountability system set
forth in sec. 116 of WIOA.
A " neutral" exit, as it relates to the
performance accountability provisions,
allows the State to exclude certain
participants from the calculation of the
primary indicators. The Departments
have concluded that there is sufficient
statutory authority to permit certain
exclusions, as appropriate, from the
performance calculations for the
primary indicators of performance. The
Departments have implemented these
exclusions through the WIOA Joint
Performance ICR. The Departments have
concluded that it is important to
account for premature exits from the
program and that modifying the
definition of " exit" to allow neutral
exits would undermine program
accountability intended by WIOA. The
Departments intend to provide guidance
on how to calculate the primary
55833Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
indicators of performance and provide
guidance on other performance -related
requirements through the WIOA Joint
Performance ICR, programmatic
guidance, and technical assistance. No
change to the regulatory text was made
in response to these comments.
Comments: A commenter emphasized
the need for guidance regarding the
transition from active programming to
follow-up services, particularly as it
relates to the definition of " exit."
Departments' Response: The
Departments will provide further
guidance regarding the transition from
active programming to follow-up
services as it relates to the definition of
exit."
Definition of "State" (§ 677.150( d))
The Departments have added a
definition of " State" as § 677. 150( d) to
specify that the outlying areas are
subject to the performance
accountability provisions of part 677.
This provides that, for purposes of part
677 other than in regard to sanctions or
the statistical adjustment model, " State"
includes the outlying areas of American
Samoa, Guam, Commonwealth of the
Northern Mariana Islands, the U.S.
Virgin Islands, and, as applicable, the
Republic of Palau. In so doing, as
discussed in detail immediately below
regarding outlying areas, the
Departments ensure that the
performance accountability
requirements apply to the outlying areas
as well. This regulatory change is
essential to ensuring consistency with
the Departments' decision to require
outlying areas to submit Unified or
Combined State Plans which, pursuant
to sec. 102 of WIOA must include
expected levels of performance, thereby
making the performance accountability
system applicable to the outlying areas.
In the NPRM, the Departments
specifically requested comments about
the applicability of WIOA sec. 116
performance accountability system
requirements to the core programs
administered by the outlying areas,
namely American Samoa, Guam,
Commonwealth of the Northern Mariana
Islands, the U. S. Virgin Islands, and, as
applicable, the Republic of Palau (80 FR
20574, 20583-20584 (April 16, 2015)).
The Departments explained the
ambiguity that was created by differing
terms and definitions for outlying areas
and States, for purposes of the title I
core programs, but made clear that titles
II and IV specifically subject adult
education and VR grantees, including
outlying areas, to the common
performance accountability system set
forth in sec. 116 of WIOA.
Sections 189( a) and (c) of WIOA
provide the authority to impose
planning and performance reporting
requirements on outlying areas, which
is being accomplished through this
definition. The decision to treat outlying
areas as States for purposes of the
common performance accountability
system dovetails, and is consistent with,
the Departments' decision to treat
outlying areas the same as States for
purposes of the Unified and Combined
State Plan requirements, as discussed
elsewhere in this preamble with respect
to part 676 of this Joint WIOA Final
Rule.
Although the Departments will hold
the outlying areas accountable for
complying with the performance
accountability system requirements of
sec. 116 of WIOA and part 677, the
Departments will not impose monetary
sanctions against the outlying areas
pursuant to sec. 116(f)(1)( B) of WIOA for
two reasons. First, the sanctions are
imposed against the Governor' s Reserve
under sec. 128( a) of WIOA, which the
outlying areas do not receive. Second,
the sanctions are imposed when a State
fails to satisfy the adjusted levels of
performance or fails to report. The
adjusted performance level is based on
several required factors set forth in sec.
116(b)( 3)( A)(v) of WIOA, including,
among other things, the use of a
statistical adjustment model. The
performance output data provided by
the core programs in the outlying areas
yield too small a sample size; thus,
applying an adjustment model to the
outlying areas will not yield a valid
result. In addition, there are cases in the
outlying areas where required data are
not available to run the statistical
adjustment model. Despite the fact that
the Departments will not impose
monetary sanctions against the outlying
areas in accordance with sec.
116( f)(1)( B) of WIOA, the Departments
want to make clear that the Departments
will hold outlying areas accountable for
poor performance or failure to report
through technical assistance and the
development of performance
improvement plans in accordance with
sec. 116(f)(1)( A) of WIOA.
3. State Indicators of Performance for
Core Programs ( 20 CFR Part 677,
Subpart A; 34 CFR 361. 155 Through
361. 175; 34 CFR 463. 155 Through
463. 175)
Section 677. 155 What are the primary
indicators of performance under the
Workforce Innovation and Opportunity
Act?
Section 677. 155 implements the
primary indicators of performance as set
forth in WIOA sec. 116(b)( 2)( A)(i).
These primary performance indicators
apply to the core programs described in
sec. 116( b)( 3)( A)(ii) of WIOA, and
administered by ED' s OCTAE and RSA,
and DOL' s ETA. These primary
indicators of performance create a
common language shared across the
programs' performance metrics, which
the Departments anticipate will support
system alignment, enhance
programmatic decision-making, and
facilitate consumer choice. The
Departments implement the
requirements of sec. 116 of WIOA
through this Joint WIOA Final Rule, as
revised and described in this preamble.
Comments: A commenter expressed
concern about the cost and time it
would take to establish and operate a
fiscal and management accountability
information system.
Departments' Response: The
Departments recognize the concerns
raised with regard to the infrastructure,
and resulting cost, required to
implement the performance, fiscal, and
management accountability information
systems. No changes to the regulatory
text were made in response to this
comment because the performance
accountability provisions outlined
within sec. 116 of WIOA clearly
mandate States and local areas to collect
and report on the information contained
in part 677. The Departments want to
make clear that all core programs were
required, even prior to the enactment of
WIOA, to operate fiscal and
management systems pursuant to WIA,
former OMB Circular A-87, OMB' s
Uniform Guidance ( 2 CFR part 200), and
programmatic requirements. It is
important to note that WIOA' s
requirements for States to operate such
systems are very similar to those
required under WIA, which is why the
Departments do not consider these to be
new requirements. However, the
Departments acknowledge an
integration of such systems would be a
departure from that required under WIA
and recognize that time and resources
combined with guidance and technical
assistance will be necessary before an
integration of fiscal and management
systems could occur.
The Departments have concluded that
system integration will, in the long-
term, reduce administrative and
reporting burden while supporting
alignment and comprehensive
accountability across all of the core
programs. The Departments will work
with State and Local WDBs, one-stop
center operators, and partners to achieve
an integrated data system for the
programs covered by WIOA to ensure
interoperability and the accurate and
55834 Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
standardized collection of program and
participant information. Integrated data
systems will allow for unified and
streamlined intake, case management
and service delivery, minimize the
duplication of data, ensure consistently
defined and applied data elements,
facilitate compliance with performance
reporting and evaluation requirements,
and provide meaningful information
about core program participation to
inform operations. Data integration may
be accomplished through a variety of
methodologies including data sharing,
linking systems, or use of data
warehouses.
Comments: A commenter urged State
and local planning efforts to use the
most current Census and administrative
data available to develop estimates of
each priority service population.
Departments' Response: The
Departments note that the WIOA State
Plan ICR provides guidance as to what
information should be included in the
analysis and the State Plan
requirements. No change to the
regulatory text is being made in
response to this comment.
Comments: A commenter
recommended creating data systems to
separate participants by program and
local area and allowing the progress
measures to be skills based using goal
setting rather than time intervals. A
commenter recommended adding self-
sufficiency as an indicator of
performance. Commenters supported
workforce system performance that
addresses the needs of veterans with
disabilities.
Departments' Response: Changing the
primary indicators of performance to a
skills -based measurement system, rather
than one based on time intervals, would
not be consistent with the primary
indicators of performance set forth in
sec. 116( b)( 2)( A)(i) of WIOA, which
require the measurement of employment
in the second and fourth quarters after
exit, the attainment of a credential
during participation in the program and
up to 1 year post exit, and the
attainment of measurable skill gains
during the program year. WIOA clearly
establishes timeframes for each of these
primary indicators of performance.
However, sec. 116(b)( 1)( A)(ii) of
WIOA and § 677. 165 permit States to
develop additional indicators of
performance. If a State were to do so,
the State could implement skills -based
indicators or indicators that measure
self-sufficiency or services to veterans
with disabilities as suggested by
commenters. The Departments
encourage State and Local WDBs to
work in collaboration to identify and
implement additional indicators of
performance that aid in the management
of workforce programs in their State. No
change to the regulatory text is being
made in response to this comment.
Comments: In the preamble to the
NPRM, the Departments requested
comments on using the performance
indicators identified in § 677. 155 for
additional programs beyond the core
programs. The Departments postulated
that this broader use of the six primary
indicators of performance could
streamline reporting on other DOL -
administered programs, such as the
JVSG program and other discretionary
grant programs. Commenters supported
the use of common metrics across
education and workforce programs
wherever appropriate. Commenters also
raised questions about alignment with
various specific programs, such as
Migrant and Seasonal Farmworkers, Job
Corps, Indian and Native American,
Family Literacy, Integrated English
Literacy and Civics Education, Wagner-
Peyser Act Employment Service, Adult
Education, and JVSG.
Departments' Response: The
Departments acknowledge that WIOA
has introduced unprecedented
opportunities for alignment and as such,
envision integration across workforce
programs to the maximum extent
feasible. The core programs, described
in sec. 116( b)( 3)( A)(ii) of WIOA, are
covered under this Joint WIOA Final
Rule and the WIOA Joint Performance
ICR. National programs such as Job
Corps, the National Farmworker Jobs
Program, and the Indian and Native
American adult and youth programs
that are authorized under title I of
WIOA are also aligned under this
regulation, as well as their respective
program regulations at 20 CFR parts 686
Job Corps), 685 ( National Farmworker
Jobs Program), and 684 (Indian and
Native American Program).
Additionally, the Departments intend
that DOL -administered partner
programs authorized by statutes other
than WIOA and not covered under these
joint regulations, such as the JVSG
programs and the TAA programs, will
be aligned with the performance
accountability system under WIOA
through both legislative and policy
guidance. The Departments recognize
the variety of interactions among
programs under WIOA and programs
authorized by other statutes. The
Departments understand the need for
further guidance and clarification,
which will be issued throughout the
workforce development system and
which will include information on how
and where to report.
Comments: A commenter noted that
many programs for out-of-school youth,
including Job Corps, often use
accredited online high school programs
to provide education to youth
participants. The commenter requested
that any measure intended to capture
progress on achieving or attaining a high
school diploma or recognized
equivalency degree should reflect any
State -accredited standard.
Departments' Response: Details
regarding accreditation are beyond the
scope of this Joint WIOA Final Rule and
will be addressed in guidance or in the
WIOA Joint Performance ICR or DOL
Performance ICR. No change to the
regulatory text is being made in
response to this comment.
Comments: Commenters requested
guidance and examples on several
subjects, such as: Measuring and
reporting registered apprenticeship
performance; how wages for successful
and unsuccessful closures are used and
measured; performance data for
industry -driven credentials; students
with degrees from another country;
areas where net income can apply as a
performance indicator; incorporating
self-employment as a successful
outcome; performance metrics; when
enrollment occurs; operational
definitions; determination of
competitive wage; cross program
impacts; individualized measurements
of the six primary indicators as relates
to VR consumers; and individual skills
measurement. A few commenters asked
that States be allowed flexibility in
developing data sharing agreements and
additional performance measures.
Departments' Response: The
Departments acknowledge the need for
clarification and examples to illustrate
the methods that each of the core
programs will use to determine
performance on the primary indicators,
including details regarding data
collection for self-employment
outcomes, as well as educational
attainment and measurable skill gains.
The Departments will address these
issues in guidance and in the
instructions for program -specific
reporting requirements contained in the
WIOA Joint Performance ICR.
With regard to requests for State
flexibility in developing data sharing
agreements and additional performance
measures, sec. 116(b)( 1)( A)(ii) of WIOA
and § 677. 165 permit States to
implement, through their State Plans,
additional indicators of performance
and encourage States to also leverage
their program collection and reporting
to analyze and manage performance of
their programs. With regard to data
sharing agreements States have the
flexibility to enter into data sharing
agreements, ensuring that such
55835Federal Register / Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
agreements meet all applicable Federal
and State statutory and regulatory
confidentiality requirements. No change
to the regulatory text is being made in
response to this comment.
Section 677. 155( a)( 1) identifies the
six primary indicators of performance
that will be applied to the core programs
identified in sec. 116( b)( 3)( A)(ii) of
WIOA. Where practicable, DOL intends
to leverage these indicators to
streamline reporting for other DOL -
administered programs, such as the
JVSG program, TAA and other
discretionary grant programs.
Section 677.155(a)( 1)(i)implements
the first primary indicator as described
in sec. 116(b)( 2)( A)(i)(I) of WIOA. This
primary indicator is a measure of the
percentage of program participants who
are in unsubsidized employment during
the second quarter after exit from the
program. There are no changes to
677. 155( a)( 1)( i) from that proposed in
the NPRM, which mirrors the statutory
requirement of WIOA sec.
116(b)( 2)( A)(i)(I).
Comments: A commenter
recommended that calculated
employment percentages should not
include individuals who never received
core program services.
Departments' Response: The issue
raised by the commenter is more closely
related to the definitions of
participant" and " reportable
individual," as set forth in § 677. 150
and which are discussed in detail above.
The Departments have concluded that
these definitions are clear in setting the
standards under which participants are
included in performance calculations
for purposes of the primary indicators of
performance. Specifically, the definition
of " participant" at § 677. 150( a) ensures
that an individual is receiving services
of a substantive nature from any of the
core programs before the individual is
considered a " participant" and, thus,
included in performance calculations.
Because § 677. 155( a)( 1)( i) is consistent
with sec. 116( b)( 2)( A)(i)(I) of WIOA, no
change to the regulatory text is being
made in response to this comment.
Comments: A number of commenters
expressed support for the WIOA
requirements as proposed in
677. 155( a)( 1)( i) and (ii).However,
many commenters recommended that
this section of the regulation and the
section related to calculating
performance should include the option
for excluding participants who report
that they are not working and not
looking for work. These commenters
cited data showing that 29 percent of
AEFLA participants were " not in the
labor force." A commenter suggested
adding the words " who are in the labor
force at enrollment" after the word
participants" in § 677. 155( a)( 1)( i)
through (iii). Another commenter stated
that it would seem practical to include
participants who are not looking for
employment in the calculation of the
employment performance outcome.
Departments' Response: The
Departments acknowledge the concerns
raised by commenters about being held
accountable for those participants who
enter the program and are not seeking
employment, and about how
participants not in the labor force might
affect performance outcomes. However,
WIOA secs. 116(b)( 2)( A)(i)(I) through
b)( 2)( A)(i)( III) measure the percentage
of program participants in employment
during the second and fourth quarters
after exit and the median earnings of
participants in the second quarter after
exit. Therefore, the Departments
disagree with commenters who believe
that individuals who are not looking for
work should not be included in the
performance calculation. Having said
this, the Departments recognize that
there are very limited circumstances
where certain individuals, such as those
who are incarcerated and receiving
services under sec. 225 of WIOA, should
not be included in the performance
calculations for this indicator. The
Departments have decided to exclude
incarcerated individuals served under
sec. 225 of WIOA because they do not
have the opportunity to obtain
employment or participate in education
or training programs in the same
manner as other participants who are in
the general population. The
Departments consider additional
determinations regarding the need for
exclusions from performance
calculations to be more appropriately
made through the ICR process and,
therefore, have added § 677. 155( a)( 2) to
the regulatory text. This matter will be
discussed in more detail with respect to
that provision below.
Comments: Another commenter asked
whether the State can use AEFLA funds
to serve individuals who are not looking
for employment.
Departments' Response: Section
203( 4) of WIOA defines an eligible
individual for the purposes of AEFLA.
Eligibility does not include employment
status. Whether or not an individual is
seeking employment does not affect that
person' s eligibility status under title II.
Further matters concerning AEFLA
program implementation are in the
program -specific final regulations
published elsewhere in this issue of the
Federal Register.
Comments: Several commenters
opposed the suggestion in the preamble
to the NPRM that the Departments plan
to calculate an " entered employment
rate" for participants who were not
employed at the time of program entry,
in addition to an employment rate for
all program participants regardless of
employment status at entry.
Departments' Response: Upon
consideration of the various issues, the
Departments have not made changes to
these joint regulations to require the
collection and reporting of an entered
employment rate. Instead, the
Departments intend to utilize the
individual records available for the
WIOA title I, Wagner-Peyser Act
Employment Service, and VR programs
i.e., the disaggregated data submitted
by the States) to calculate such a
measure for comparative purposes. The
Departments can calculate this entered
employment rate from the information
that is required to be collected under
sec. 116 of WIOA. Therefore, no
additional reporting burden will be
imposed on the States for these
programs for this additional calculation
at the Federal level.
However, such entered employment
rate calculations will not be possible at
the Federal level for the AEFLA
program under title II, because States
report AEFLA program data only in an
aggregate manner. Therefore, for the
Departments to receive the data
necessary to perform the entered
employment rate calculation for the
AEFLA program—and to produce such
outcome data— would place an undue
burden on title II programs.
Comments: Most commenters
opposed including the entered
employment rate as a performance
indicator. A number of commenters
recommended that only the
employment rate should be counted for
those employed during the second
quarter after exit because less document
retrieval would be required, and there
are other indicators that can show
whether program participants are better
off after enrollment. Other commenters
suggested that the employment rate
should include job seekers who were
both employed and not employed at the
time of participation because this will
help determine how effective the system
is at helping both the unemployed and
those looking for career progression. A
commenter added that it is difficult to
capture information about employees in
part-time or multiple -employer jobs.
Several other commenters, however,
supported calculation of an entered
employment rate, particularly for youth
programs.
The Departments also received
numerous comments in reference to
calculating the second quarter after exit
employment indicator as an " entered
55836 Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
employment measure," as defined in
WIA. A commenter only would support
an entered employment calculation if
the Departments modified the regulation
to require submission of individual
records under title II.
Departments' Response: The
Departments have concluded that that
the entered employment rate will
provide a useful comparison of the
public workforce system as it exists
under WIA and WIOA. As stated above,
the Departments will calculate an
entered employment rate for the WIOA
title I, Wagner-Peyser Act Employment
Service, and VR programs using
information collected through the WIOA
Joint Performance ICR. This entered
employment rate will not be a primary
indicator of performance and, thus, it
will not be a basis for sanctions. It is
nonetheless useful information in
evaluating the impact and efficacy of
programs under WIOA. No change to
the regulatory text is being made in
response to this comment.
Comments: A commenter opposed
measuring the employment rate in the
second quarter after exit instead of the
first quarter, as done under WIA,
because the commenter suggested that 2
quarters after exit is too late to
determine unsubsidized employment.
Another commenter agreed that it is
simpler to locate and re-engage a
customer after the first quarter
performance measure rather than
waiting an additional 3 months. A
commenter added that the time frame of
6 months for an individual working in
an integrated setting to achieve a
competitive integrated employment
outcome is too fixed and arbitrary, and
the time period should be increased to
18 months if needed by the individual.
Another commenter warned that using
the second and fourth quarters after exit
for performance measures will
negatively impact States with a highly
seasonal workforce.
Departments' Response: The
Departments acknowledge the concerns
raised, but sec. 116( b)( 2)( A)(i)(I) and (II)
of WIOA specifically require that
employment be measured at the 6-and
12 -month mark (second and fourth
quarters respectively). Given the
specificity of the quarters to be
measured for purposes of the
performance accountability system, the
Departments do not have the authority
to implement a regulation inconsistent
with the statutory requirement. No
change to the regulatory text is being
made in response to this comment.
Comments: A commenter opposed the
provisions in §§ 677. 155( a)( 1)( i) and
677. 175( a) because of a concern that
these provisions would ask educators to
store personal data, such as social
security numbers ( SSNs), that the
students may be unwilling or unable to
share.
Departments' Response: The
Departments acknowledge the concerns
about the retention of SSNs. The
Departments concluded that, where
available and possible, the use of wage
records to fulfill reporting requirements
is required in accordance with sec.
116( i)( 2) of WIOA. Matching participant
SSNs against quarterly wage record
information is the most effective means
by which timely and accurate data can
be made available to the system.
However, consistent with the Privacy
Act, program services cannot be
withheld if an individual is unwilling or
unable to disclose a SSN. More
specifically, program eligibility is not
contingent on the provision of a SSN for
any of the core programs.
Nevertheless, the use of quarterly
wage records is essential to achieve full
accountability under the WIOA
performance accountability system to
identify high performing States and
localities, and, if necessary, to provide
technical assistance to help improve
performance or sanction low performing
States and localities. Matching
participant SSNs against quarterly wage
record information is the most cost-
effective means by which timely and
accurate data can be made available to
the system.
In consideration of the circumstances
articulated by commenters in responses
to both the Joint WIOA NPRM and the
proposed WIOA Joint Performance ICR,
the Departments will allow the
collection and verification of non -UI
wage data in the absence of available UI
wage data obtained through wage record
matching, as discussed more fully in the
preamble to § 677. 175 below. The
Departments also intend to issue
guidance and technical assistance
regarding the collection and reporting of
both quarterly wage record data and
supplemental information. No change to
the regulatory text is being made in
response to this comment.
Comments: A commenter remarked
that the indicators in § 677. 155( a)( 1)( i)
through (iii) would require an
unprecedented degree of
interdependency between VR and other
State and Federal repositories of
employment data. Another commenter
recommended that, given that several of
the primary performance indicators for
the core programs, including VR,
require reporting on the percent of
exiters who are in " unsubsidized
employment," the Departments should
clearly define " unsubsidized
employment." In particular, the
commenter requested clarity regarding
whether individuals in competitive
integrated employment who receive
supported employment services
following VR case closure are
considered to be in " unsubsidized
employment."
Departments' Response: The
Departments acknowledge that the use
of wage record data for the employment
and median earnings indicators will
require a greater level of cooperation
between the State VR and UI agencies.
The Departments are developing
guidance to facilitate this process and
also are developing a new State wage
record interchange system data sharing
agreement to aid in the exchange of
wage record data to enable all core
programs to meet the performance
reporting requirements outlined in these
regulations and sec. 116 of WIOA.
The Departments have considered the
comments regarding the VR program
and " unsubsidized employment."
Section 116 of WIOA describes the
primary performance indicators for all
core programs, including the VR
program. Three of the performance
indicators pertain to the employment
status or median earnings of
participants who exit a program in
unsubsidized employment. In response
to the commenter regarding supported
employment and unsubsidized
employment, the Departments want to
clarify that supported employment
means, in general for purposes of the VR
program, employment in competitive
integrated employment or in an
integrated setting in which the
individual is working towards
competitive integrated employment on a
short-term basis. Once an individual
achieves supported employment as an
employment outcome under the VR
program and exits that program (in other
words, his or her VR record of service
is closed), the individual typically
receives extended services from another
provider. Receipt of extended services
after the VR record of service is closed
does not affect the nature of the
employment. Supported employment is
considered unsubsidized employment
because the wages are not subsidized by
another entity. Individuals in supported
employment at subminimum wage who
are working on a short-term basis
toward competitive integrated
employment would not satisfy the
definition of " exit" for performance
accountability purposes.
Comments: A commenter
recommended that adult education
providers receive student -level
disaggregated wage or UI data for
compliance and input into the Student
Information System tracking and
55837Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
monitoring application and that MOUs
and guidance from the Departments
must authorize access. Commenters
concluded that States may need to use
alternative methods for tracking
employment outcomes for participants
and need to be provided with options
for databases and data sharing.
Departments' Response: As
mentioned above, the Departments are
aware of the necessity for pathways to
match wage record data to exit data in
order to have complete outcome
information on a program. The
Departments reiterate their intent to
issue guidance and facilitate a new data
sharing agreement in order to facilitate
wage record data matching required for
all core programs in meeting their
performance reporting requirements
under WIOA. These agreements will be
executed under the authority of WIOA
sec. 116( i)( 2) and consistent with all
applicable Federal and State privacy
and confidentiality laws and
regulations. The Departments cannot
require the sharing of individual level
PII from wage records with entities that
do not meet the requirements of 20 CFR
part 603. It should be noted that the
Departments are aware of and recognize
that a variety of structures exist within
States affecting levels of access to
certain types of information required to
comply with WIOA and efforts are
underway to issue joint guidance on
data access and how to obtain what is
necessary to comply with WIOA
reporting requirements.
Comments: An individual expressed
concern that the performance indicators
in § 677.155(a)( 1)( i) and (ii) may act as
a disincentive to making progress in
further education and training after exit.
A commenter asked for clarification
about the calculations for employment
in the second and fourth quarters after
exit, inquiring as to the time period for
measurement and the individuals to be
included in the measure.
Departments' Response: The
Departments have considered
commenters' concerns regarding the
disincentive the employment
performance indicators may create for
furthering education and training after
exit. However, sec. 116( b)( 2)( A)(i)(I) of
WIOA establishes a statutory
requirement for a performance indicator
measuring the percentage of program
participants who are in unsubsidized
employment during the second quarter
after exit from the program. Subsequent
guidance providing the time periods for
measurement and other operational
parameters pertaining to calculations
will be issued by the Departments.
Comments: In the preamble to the
Joint WIOA NPRM, the Departments
asked for public comment on whether
and how to collect information on the
quality of employment. A commenter
suggested that while the Departments
are proposing some metrics that attempt
to assess the quality of employment,
specifically mentioning median wage,
retention, and training -related
outcomes, the Departments should
consider looking at quality of
employment once the current
performance indicators are
implemented. Other commenters
asserted that information on the quality
of employment should not be collected
because it is redundant, costly, and too
subjective. Another commenter
described several factors contributing to
the quality of employment: Fair,
attractive, and competitive
compensation and benefits;
opportunities for development, learning,
and advancement; wellness, health, and
safety protections; availability of
flexible work options; opportunities for
meaningful work; promotion of
constructive relationships in the
workplace; culture of respect, inclusion,
and equity; and provisions for
employment security and
predictabilities. Other commenters
added the importance of wages
sufficient to sustain the worker and
dependents, work -based training,
changes in net income, worker input
into schedules, and employment
outcomes consistent with the
consumer' s education and employment
goal. One of the commenters
discouraged making inappropriate
comparisons across programs.
Departments' Response: The majority
of commenters did not support
collecting information on the quality of
employment because it would be too
subjective to collect consistently, overly
burdensome, and costly. At this time,
the Departments have decided not to
include such a measure because it
would be too burdensome to implement
a measure that would have to be
developed in the absence of an existing
metric. The Departments will consider
in the future whether there is a suitable
mechanism to measure the quality of
employment. No change to the
regulatory text is being made in
response to this comment.
Section 677.155(a)( 1)(ii)implements
the second statutory indicator as
described in sec. 116( b)( 2)( A)(i)( II) of
WIOA. This indicator is a measure of
the percentage of program participants
who are in unsubsidized employment
during the fourth quarter after exit from
the program. This section, which
mirrors WIOA sec. 116( b)( 2)( A)(i)(II),
remains unchanged from what was
proposed in the NPRM.
Under WIA, the common measures
included a retention measure based on
individuals who were employed in the
first quarter after exiting from WIA
services, and who were also employed
in the second and third quarters. WIOA
does not have an equivalent to the WIA
retention measure. Instead, WIOA
requires a second— separate and
distinct—employment indicator for the
fourth quarter after exit, which
measures the employment rate in that
quarter, regardless of whether those
participants also were employed in the
second quarter after exit from the
program. In other words, a participant
would be counted as a positive outcome
for this indicator if he or she was
employed in the fourth quarter after exit
regardless of whether he or she was also
employed in the second quarter after
exit.
Comments: In the preamble to the
NPRM, the Departments sought
comment on the advantages and
disadvantages of collecting or reporting
the employment retention rate. A
commenter expressed support for a
retention rate because it would be an
important measure to know, for
example, when comparing Job Corps to
other youth programs. A few
commenters reasoned that a retention
rate would represent the quality of the
initial job placement. Many commenters
supported using a retention rate as long
as programs would not be held
accountable to negotiated goals for
employment retention and States would
not be required to capture, report, or
calculate additional values. Some
commenters opposed highlighting
measures of employment retention
because they would be confusing for the
system and impede the transition from
the measures in WIA to the indicators
in WIOA. A commenter stated that there
was no benefit to calculating this
measure for WIOA title I programs;
however, another commenter supported
the proposed provision to calculate a
retained employment rate in the fourth
quarter after exit. An individual
commented that if fourth quarter
employment is not used as a retention
measure, then the growth or reduction
of the employment rate of the cohort can
be used to evaluate occupational skills
training, particularly for those who are
underemployed.
There were a few commenters who
articulated a preference for the
requirement under WIA. Commenters
stated that employee retention is based
on market conditions and dependent on
factors such as company working
conditions. Commenters also asserted
that a retention measure should take
into account a change or advancement
55838 Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
in occupation and quality or levels of
work. A commenter remarked that by
collecting or reporting the retention rate,
the Departments could compare
performance under WIOA with
performance under WIA, but the
commenter also suggested this was not
necessary. A few commenters asked
whether the individual had to be
working with the same employer or at
the same job between the second and
fourth quarters. Other commenters
recommended that employment
retention should be measured regardless
of whether the employer or job title has
changed.
Departments' Response: As stated
above, retained employment rate would
not be counted for the purpose of
performance calculations and, thus,
would not form the basis for sanctions
because it is not among the primary
performance indicators set forth in sec.
116(b)( 2)( A)(i) of WIOA. The
Departments have concluded that
calculating a retained employment rate
would provide useful information about
the effectiveness of services that lead to
sustained attachment to employment.
The Departments will calculate a
retained employment rate for
participants who were employed at the
second quarter after exit for
informational purposes at the Federal
level for those programs for which the
Federal offices collect individual (i.e.,
disaggregated data) records (i.e., for the
WIOA title I, Wagner-Peyser Act
Employment Service, and VR programs).
For the AEFLA program, for which ED
does not collect individual (i.e.,
disaggregated) records, the Departments
will not require States to calculate and
report a retained employment rate in
addition to an employment rate at the
fourth quarter after exit.
Comments: With regard to this
indicator and partner program metrics,
one commenter remarked that in States
where TANF is a required one-stop
partner, a performance metric that is
limited to 1 year after exit from the
program may not align with outcomes
that are significant for TANF customers,
resulting in positive outcomes of TANF
employment services that will not be
captured. Another commenter suggested
that the fourth quarter employment
information could be obtained more
easily by the local DOL office rather
than the State VR administration and as
such, State VR agencies should not be
required to report this data.
Departments' Response: The
Departments acknowledge the
commenters' concerns regarding the
capture of outcomes for TANF
employment services and the difficulty
some programs will face in the
collection of the data necessary to
calculate this indicator. However, if an
individual is a participant in a WIOA
core program as described in sec.
116(b)( 3)( A)(ii) of WIOA, sec.
116(b)( 2)( A)(i)(II) of WIOA explicitly
requires the Departments to measure the
employment rate for that participant in
the fourth quarter after exit, regardless
of whether that individual is also a
participant in TANF or any other
required partner program. With regard
to comments that maintain that VR
agencies should not have to report data
on the fourth quarter after exit due to
issues of data access and availability,
the Departments reiterate the intent to
renegotiate the wage record data sharing
agreements and issue joint guidance on
accessing such data in order to meet the
requirements laid out in WIOA sec. 116.
The Departments strongly encourage the
development, enrichment, and
enhancement of partnerships at the
State and local levels to leverage such
connections in obtaining relevant
performance information. No change to
the regulatory text is being made in
response to this comment.
Section 677.155(a)( 1)(iii)implements
the third statutory indicator as
described in sec. 116( b)( 2)( A)(i)( III) of
WIOA. This indicator is a measure of
the median earnings of those program
participants who are in unsubsidized
employment in the second quarter after
exit. This section remains unchanged
from that proposed in the NPRM.
Comments: Several commenters
requested guidance on how to match
wage records or collect employment-
related data without the use of SSNs,
because some States cannot collect
SSNs and some students do not have
them. A commenter suggested that the
regulation should provide States with
the authority to require SSNs as a
condition of program participation.
Another commenter asserted that WIOA
only should require SSNs when
customers are directly receiving some
form of financial assistance. A
commenter discussed the challenge of
tracking the progress of individuals
without SSNs. A commenter urged the
Departments to provide ways for
agencies to share long-term wage and
employment information to enable the
commenter to report on the indicators.
Departments' Response: The
Departments considered the concerns
raised by commenters in light of the
statutory provisions at WIOA sec.
116(b)( 2)( a)( 1)( iii) and concluded that,
where available and possible, the use of
wage records to fulfill reporting
requirements is required in accordance
with sec. 116( i)( 2) of WIOA. Matching
participant SSNs against quarterly wage
record information is the most effective
means by which timely and accurate
data can he made available to the
system.
Nevertheless, the Departments want
to make clear that neither WIOA nor
this Joint WIOA Final Rule allows or
requires States to request or require
SSNs as a condition of program
participation or for receipt of any form
of financial assistance. As such,
program eligibility under WIOA is not
contingent on the provision of a SSN.
Additionally, depriving such an
individual of service would he in
violation of the Privacy Act of 1974,
which establishes a code of fair
information practices that govern the
collection, use, dissemination, and
maintenance of information about
individuals contained in systems of
Federal records. Specifically, sec. 7( a)( 1)
of the Privacy Act (5 U.S.C. 552a Note,
Disclosure of Social Security Number)
provides that unless the disclosure is
required by Federal statute, " It shall be
unlawful for any Federal, State, or Local
government agency to deny to any
individual any right, benefit, or
privilege provided by law because of
such individual' s refusal to disclose his
social security account number." In
consideration of the circumstances
articulated by the commenters in public
comments received on both the Joint
WIOA NPRM and the WIOA Joint
Performance ICR, the Departments are
allowing the use of supplemental
information to augment the performance
information obtained through wage
record matching when necessary
because critical information (such as a
SSN) is not available. More information
can be found in the preamble to
677. 175 discussed in more detail
below. The WIOA Joint Performance
ICR also will provide for the collection
of such supplemental wage information
in those circumstances where quarterly
wage records are not available or may
not apply. The Departments also intend
to issue guidance and technical
assistance regarding the collection and
reporting of both quarterly wage record
data and supplemental information on
employment -based outcomes.
Comments: Some commenters
supported the use of median earnings
rather than average (mean) earnings,
used under WIA, noting that averages
can be skewed by a few numbers. One
commenter stated that the indicator data
should be collected at both the second
and fourth quarters. Commenters
suggested that the median earnings
indicator should be based on all
earnings and not just earnings related to
the employment goals on the IPE for
customers of VR services. With the
55839Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
change from an average earnings
calculation under WIA to a median
earnings calculation under WIOA, one
commenter asked how to arrive at a
baseline for determining performance
numbers. A few commenters said they
would prefer reporting both average and
median wages and highlight the high-
income employment outcomes they
have historically achieved. The
commenters also asked how to best
verify and include incomes for self-
employment outcomes in this indicator.
Departments' Response: WIOA sec.
116(b)( 2)( A)(i)(III), which forms the
basis for § 677.155(a)( 1)(iii),requires
States to collect data regarding median
earnings of participants who are in
unsubsidized employment during the
second quarter after exit from a core
program. The Departments have the
authority to collect additional
information that provides context for
the primary indicators of performance.
Such information is important to
understand and manage public
workforce programs. The Departments
note that the primary indicators
identified in § 677. 155 are the only
indicators subject to the performance
accountability sanctions. Additionally,
pursuant to sec. 116(b)( 1)( A)(ii) of
WIOA and § 677. 165, States may
develop additional performance
indicators which could include median
earnings in the fourth quarter, as the
commenter suggests.
With regard to inclusion of all
earnings and not just those earnings
related to employment goals on the IPE
for customers of VR services, the
individual records collected under the
RSA -911 can be used to determine
median wages at exit. The Departments
acknowledge that wages may vary over
time and that median earnings at exit
may not reflect median wages in the
second and fourth quarters after exit.
With regard to baseline data for median
earnings, the Departments recognize
that some programs may not have the
historical data necessary to establish a
baseline for median earnings while
other programs can review the data
collected under WIA to establish an
approximate baseline for this indicator.
The Departments acknowledge the
concerns raised regarding such
employment outcomes that would not
be captured through a pure match
against State UI wage records, such as
self-employment. The Departments will
promulgate guidance regarding the
collection and verification of
supplemental employment information,
as noted in the preamble to
677. 155( a)( 1)( iii) and more fully
discussed in the preamble to § 677. 175.
The Departments recognize there is a
need to further clarify and provide
guidance regarding transitioning to the
WIOA performance indicators and
intend to provide further clarification
and guidance on the establishment of
baseline data. No change to the
regulatory text is being made in
response to these comments.
Comments: A few commenters
recommended that the value of benefits
received should be included in the
participants' median earnings indicator.
Commenters urged reporting of wages
expressed as dollars per hour to reflect
outcomes for part-time workers
accurately.
Departments' Response: Since the
value of benefits clearly does not
constitute earnings, adopting this
recommendation would be inconsistent
with the statutory provision calling for
measuring earnings. Further information
and clarification regarding the
operational parameters of each indicator
will be provided through both the
WIOA Joint Performance ICR and
program guidance. No change to the
regulatory text is being made in
response to these comments.
Comments: A few commenters stated
that individuals participating in an
education or training program should be
excluded from the calculation of this
indicator. Commenters especially
expressed support for not including
youth who were enrolled in
postsecondary education in the median
earnings indicator because such youth
would not necessarily have an income.
Some commenters warned that as many
individuals are simultaneously enrolled
and employed part time, they tend to
work fewer hours at lower hourly wage
rates. In these instances, the earnings
measure serves as a disincentive for
programs to provide further education
and training. One of the commenters
added that exiting applicants with
entrepreneurship training may not
reflect well on the earnings measures
because a new business often takes time
to become profitable.
Departments' Response: In response
to the comments regarding exclusions
from the median earnings indicator, sec.
116(b)( 2)( A)(i)(III) of WIOA requires the
collection of data regarding the median
earnings for all participants who exit the
program and are employed during the
second quarter after exit, regardless of
whether the participants are
simultaneously enrolled in an
educational or training program. The
Departments understand the
commenters' concerns regarding the
decreased likelihood of full-time
employment while enrolled in an
education or training programs, but the
Departments expect the levels of
performance for different programs will
vary based on the results of the
statistical adjustment of the
performance levels for those programs.
Furthermore, States will have the ability
to disaggregate performance data in
order to gain an understanding of the
effect of including youth in performance
outcomes. No change to the regulatory
text is being made in response to these
comments.
Comments: Other individuals
requested guidance on how to treat
missing earnings information for
particular participants and whether the
participant may be excluded from the
dataset used to determine the median
earnings.
Departments' Response: In State wage
record systems, a missing wage means
that no wages for an individual were
reported by any firm residing in that
State. The missing wage only indicates
that the individual is not in
employment covered by the quarterly
wage records for performance
accountability purposes. The
Departments have determined that
collection and verification of
supplemental employment data is
allowed for the performance indicators
where a wage is not present in quarterly
wage data. Supplemental information
that is used to establish employment
must include earnings information and
be counted in the employment
indicators and the median earnings
indicator. This calculation is meant to
represent the median quarterly wage of
all individuals who are employed in the
second quarter after exit, therefore,
missing earnings information" will not
be included in the median earnings
calculation. Further, the Departments
have elected to permit non -wage record
matches (supplemental information) in
the performance calculations. More
information about this is in the
preamble to § 677. 175 discussed in more
detail below. The Departments note that
the use of supplemental information
must be uniform across performance
indicators. In other words, if a
participant is included in the
employment in second quarter after exit
indicator based on information obtained
through supplemental information,
wage information must be collected and
that data must also be used for the
median earnings indicator. Likewise, if
the collection and verification of
employment and wages cannot be
obtained for such a participant through
either wage record matching or through
supplemental wage information, then
the participant cannot be included as
being in unsubsidized employment
during the second quarter and fourth
quarters after exit, as measured by the
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first and second performance indicators.
The Departments will issue guidance
regarding the collection and verification
of supplemental employment
information, as noted in the preamble to
677. 155( a)( 1)( iii) and 677. 175.
Section 677.155(a)( 1)(iv)implements
the fourth statutory indicator as
described in sec. 116(b)( 2)( A)(i)(IV) of
WIOA, subject to sec. 116(b)( 2)( A)(iii).
This indicator is the percentage of
program participants who obtain a
recognized postsecondary credential or
a secondary school diploma or its
recognized equivalent, during
participation in or within 1 year after
exit from the program. The Departments
are implementing § 677. 155( a)( 1)( iv) as
revised and described here. The
regulation, consistent with the statutory
requirements, limits inclusion of
participants who obtain a secondary
school diploma or its equivalent in the
percentage counted as meeting the
criterion by only including those
participants who are employed or are
enrolled in an education or training
program leading to a recognized
credential within 1 year after exit from
the program. The Departments
specifically sought comment on
clarifications necessary to implement
this indicator.
Comments: Many commenters
expressed concerns about including all
program participants in the indicator
and asked whether the indicator is
limited to those in an education or
training program.
Departments' Response: The
Departments revised § 677. 155( a)( 1)( iv)
to clarify that this indicator only applies
to those participants who are or were
enrolled in an education or training
program. The purpose of the indicator is
to measure performance related to
attainment of a recognized
postsecondary credential or a secondary
school diploma or its recognized
equivalent. As such, it would not fulfill
the purpose of this indicator to measure
a State' s performance on the credential
attainment indicator against a universe
of participants that includes individuals
who are not in an education or training
program through which they can obtain
one of these credentials. The
Departments decided that it is
appropriate to include, for purposes of
this indicator, only those participants
enrolled in an education or training
program. The Departments have
excluded participants enrolled in work -
based on-the-job training or customized
training from this indicator because
such training does not typically lead to
a credential. This exclusion avoids
creating a disincentive to enroll in
work -based training. This section has
been revised to clarify that only those
participants in an education or training
program are included in the
performance calculations for this
performance indicator, with the
exception of those in on-the-job or
customized training. The WIOA Joint
Performance ICR also will explain that
participants, for purposes of the
credential rate performance indicator,
are only those who are in an education
or training program (excluding those in
on-the-job training or customized
training).
During the review period leading to
this Joint WIOA Final Rule, the
Departments noted an error in the
NPRM related to the statutory
requirement that participants receiving
a secondary school diploma or its
equivalent be included in the
percentage of participants meeting the
performance indicator only if the
participant is employed or enrolled in
an education or training program
leading to a recognized postsecondary
credential within 1 year of exit from the
program. The NPRM incorrectly stated
that a participant who has obtained a
high school diploma or its equivalent
only is included in the indicator if the
participant is employed or is enrolled in
an education or training program
leading to a recognized credential
within 1 year of exit from the program.
The Departments have corrected
677. 155( a)( 1)( iv) to make it consistent
with WIOA' s requirement so that a
participant who obtains a secondary
school diploma or its recognized
equivalent only counts as having met
the performance indicator if the
participant is also employed or is
enrolled in an education or training
program leading to a recognized
postsecondary credential within 1 year
after exit from the program.
Comments: A few commenters stated
that they fully supported the proposed
provision. Some commenters remarked
that WIOA presents a great opportunity
to learn more about the credentials
being earned by participants in the
workforce system. The commenters
suggested that regulations on the
reporting of credential attainment
should strike a balance between
incentivizing the collection of better
data and unfairly penalizing States that
do not have the ability to measure
attainment of all types of credentials,
and that the Departments should
consider a phased approach for making
licenses and certifications part of
performance levels.
Departments' Response: The
Departments are not planning a phased
implementation of the credential
attainment indicator because such data
generally were collected and reported
under WIA. With regard to the full
performance accountability provisions
under WIOA sec. 116, which include
the application of an objective statistical
adjustment model and the
implementation of sanctions, the
Departments did modify § 677. 190 to
allow for a phased -in approach for
assessing performance success or failure
for the purposes of sanctions in order to
provide programs time to collect and
report at least 2 full years of data
required to develop and run a statistical
adjustment model on those indicators.
More information can be found on this
in the preamble to § 677. 190 below.
Comments: In the preamble to the
NPRM, the Departments sought
comments on clarifications that would
be necessary to implement the
credential attainment indicator. Many
commenters requested clarification
about accepted credentials; how to
collect and track credentials; the
definitions of enrollment and
postsecondary credential; the
determination of "within 1 year after
exit" from the program; the achievement
of a secondary degree or General
Education Diploma (GED); and whether
the indicator applies to the VR program.
A commenter recommended
consideration of apprenticeships as
postsecondary credentials, but other
commenters suggested that employer -
based work activities generally do not
result in industry -recognized credentials
but often result in permanent
employment.
Departments' Response: The
definition of " recognized postsecondary
credential" is found in sec. 3( 52) of
WIOA, stating " a credential consisting
of an industry -recognized certificate or
certification, a certificate of completion
of an apprenticeship, a license
recognized by the State involved or
Federal Government, or an associate or
baccalaureate degree."
With respect to one comment, the
Departments note that this definition
includes completion of an
apprenticeship. In addition, the
statutory language of the credential
attainment indicator in WIOA sec.
116(b)( 2)( A)(i)(IV) includes participants'
attainment of a secondary school
diploma or its recognized equivalent in
performance calculations, subject to the
requirement that those participants also
are employed or in an education or
training program leading to a recognized
postsecondary credential within 1 year
after exit from the program. The
credential attainment indicator applies
to all core programs, including the VR
program, except for the Wagner-Peyser
Act Employment Service program, as
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specified in sec. 116(b)( 2)( A)(i) of
WIOA. To be counted as having met the
indicator, a participant must have
obtained a credential at any point
during participation in the program or
up to 1 year after exit from the program.
The Departments will issue joint
guidance that further illustrates what
constitutes a recognized postsecondary
credential for the credential rate
indicator, including definitions for each
type of credential. The Departments
recognize burden concerns for tracking
credential attainment. However, as
noted, WIOA requires the collection of
data for purposes of reporting on the
credential attainment indicator for all
core programs, except for the Wagner-
Peyser Act Employment Service
program. The Departments also will
provide joint guidance and technical
assistance for tracking and reporting
with respect to this performance
indicator.
Comments: A few commenters
expressed concern that the value of a
secondary diploma would be reduced.
One commenter suggested the
regulations should clarify that
employment is at any time during the
year after exit. Commenters
recommended including alternative,
standards-based certificates of high
school completion for students with
disabilities among the credentials
recognized for achievement of the
credential attainment indicator.
Commenters cautioned that this
indicator may not be appropriate for
students in English language acquisition
programs, and one of these commenters
requested that postsecondary
credentials include completion of
Career and Technical Education
programs. A commenter encouraged the
reporting of credential type in addition
to the attainment of a credential.
Departments' Response: The
Departments do not agree that a
secondary school diploma would be
devalued because a participant' s
attainment of a secondary school
diploma can be included in
performance calculations for purposes
of the credential attainment indicator.
For those who obtain a secondary
school diploma or its recognized
equivalent, such participants must also
be employed or in an education or
training program leading to a
postsecondary credential within 1 year
after exit from the program. Such
employment or enrollment in an
education or training program only
needs to be for some period during the
4 quarters after exit, not for the entire
1 -year period after exit. The types of
secondary school diplomas and
alternate diplomas that would satisfy
this performance indicator are those
recognized by a State and that are
included for accountability purposes
under the ESEA, as amended by the
Every Student Succeeds Act. The types
of recognized equivalents, for those not
covered under ESEA, that would satisfy
this performance indicator are those
recognized by a State. No change to the
regulatory text is being made in
response to these comments.
Comments: Several commenters also
expressed concern that State VR and
other programs do not track whether a
participant is enrolled in postsecondary
education after program exit and that to
do so would represent a significant
burden. One of the commenters
recommended that educational
attainment data could be reported as it
occurs by the appropriate State
educational authorities and matched to
participant data. A commenter
suggested that sharing information
should be mandatory between
workforce agencies and secondary and
postsecondary educational and other
training institutions. One commenter
stated that national access to
postsecondary records and earnings not
covered by UI wage records are needed
for implementation of the provision.
Departments' Response: The
Departments recognize that, in cases
where information was not previously
collected or reported on, there is an
initial burden associated with
establishing such collections for
reporting. However, the Departments
have concluded that WIOA sec.
116(b)( 2)( A)(i)(IV), read in conjunction
with sec. 116(b)( 2)( A)(iii), requires that
the indicator applies to all core
programs and necessitates tracking
enrollment and employment up to 1
year after exit. With regard to the
comments raised concerning real-time
tracking and matching of educational
attainment, the Departments note that
tracking and reporting on participants is
an obligation of the program. A State
educational authority would not
necessarily have information on all
participants enrolled in education
programs, public or private, non-profit
or for-profit. The Departments do not
currently have the authority to mandate
sharing of information between
workforce agencies and secondary and
postsecondary educational and other
training institutions in the manner
proposed. In regards to the comment
about national access to postsecondary
records and earnings, the Departments
do not think that implementation
requires national access because States
have the authority to implement
appropriate mechanisms, including data
sharing agreements, at the State level to
fulfill these reporting requirements. The
Departments are developing guidance to
help the States meet their obligations.
No change to the regulatory text is being
made in response to this comment.
Comments: One commenter stated
that participants who were in
occupational training designed to lead
to employment in a specific occupation
and who do not achieve the credential
because they have become employed in
the occupation should be removed from
the indicator. Some commenters
suggested that the credential attainment
indicator should not be calculated as the
percentage of all participants who earn
a credential, but the indicator only
should calculate the percentage of
participants receiving education or
training services who earn a credential.
A commenter recommended that the
indicator only should apply to
participants who were enrolled in a
program leading to a postsecondary
credential or secondary diploma. One
commenter cautioned that many
students are currently unavailable to the
job market. Another commenter
reasoned that cross -enrollment may lead
to participants furthering their training
in one program after leaving another,
and this may not be completed within
1 year.
Departments' Response: With respect
to the comment that the credential
attainment indicator should calculate
only the percentage of participants
receiving education or training services
who earn a credential, the Departments
reiterate, as noted above, that
677. 155( a)( 1)( iv) has been revised, as
contained in these final regulations, to
address this concern. With respect to
the comment that those who do not earn
a credential because they become
employed should not be included in the
calculation for the credential attainment
indicator, the Departments note that the
reason that a participant fails to attain
a credential, including participating in
further training, is not a basis for
excluding that participant from the
performance calculations for the
credential attainment indicator. No
change to the regulatory text is being
made in response to these comments.
Comments: Commenters also
suggested that the indicator would
result in a strong disincentive to enroll
participants in title I programs that
would not result in an industry -
recognized credential. An individual
mentioned that the indicator may
discourage participation in training
programs that take several years to
complete. Commenters also suggested
that prospective workers enrolled in
TANF and other hard -to -serve
populations may require more than 1
55842 Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
year to achieve positive outcomes and
that States have varying requirements
for attaining credentials.
Departments' Response: The
Departments note that because the
credential attainment indicator is an
exit -based indicator, there is no
requirement for a participant to attain a
credential within 1 year of enrollment
in the program. There is no time limit
on how long participants are in the
program, and the measurement point for
credential attainment is not until 1 year
following exit from the program. If
participants are in a program multiple
years before attaining a credential they
are still counted as a success in the
indicator if the credential is attained
during participation in the program or
within 1 year of program exit. Thus, the
Departments do not think that this
indicator will discourage participation
in training programs that take several
years to complete. It should be noted
that in instances where participants are
enrolled in an education or training
program that is not intended to result in
a credential, the measurable skill gains
indicator can capture progress made by
participants.
Section 677.155(a)( 1)( v) implements
the fifth statutory indicator as described
in sec. 116(b)( 2)( A)(i)(V) of WIOA. This
indicator is a measure of the percentage
of participants who, during a program
year, are in education or training
programs that lead to a recognized
postsecondary credential or
employment, and who are achieving
measureable skill gains toward such a
credential or employment. The
Departments are defining measurable
skill gains as documented academic,
technical, occupational, or other forms
of progress toward the credential or
employment. After seeking and
considering all comments on the
measurable skill gains indicator
proposed at § 677. 155( a)( 1)( v), the
Departments added five measures of
documented progress that specify how
to show a measurable skill gain.
Comments: The preamble of the
NPRM identified six examples of
standardized ways States could measure
documented progress during
participation in an education or training
program, and sought public comment on
these and other ways progress may be
measured. Some commenters generally
supported the examples as well as the
preamble language that stated,
Documented progress could include
such measures as . . ." because it
provided the State with flexibility.
Another commenter recommended a
menu system similar to the proposed
but recommended the progress measure
be attached to participant characteristics
rather than a funding stream. Other
commenters asserted that it would be
difficult to standardize measures and
documentation across all core programs
as proposed by the Departments, and
there would be little benefit for the VR
program where individuals often seek to
maintain their current occupation.
Another commenter recommended that
Local WDBs should be required to write
into their local plans an exhaustive list
of the documented progress measures
they will use.
Departments' Response: The
Departments noted the suggested ways
in which the States could measure
documented progress. The Departments
disagree with commenters that
recommend against standardized
methods, across States and core
programs, to measure documented
progress for purposes of the measurable
skill gains indicator. Section
116(b)(4)(A) of WIOA requires the
Secretaries to issue definitions of the
primary performance indicators in order
to ensure national comparability of
performance data. Defining the
measurable skill gains indicator to
include standardized methods to
measure documented progress across
programs helps to ensure this
comparability. With regard to the VR
program, although a State VR agency
may provide services to individuals
with disabilities that enable them to
maintain their current occupation, the
Departments note that the majority of
individuals served by the VR program
receive assistance in obtaining or
advancing in employment. With regard
to local plan content and the
recommendation that it include " an
exhaustive" list of the documented
progress measures, the Departments
encourage States and local areas to
consider the service provisions and
applicable progress measures in the
development of their plans but have
determined that it is beyond the scope
of part 677 to regulate concerning such
requirements. State and local plans are
discussed more fully in 20 CFR part 679
see DOL WIOA Final Rule, published
elsewhere in this issue of the Federal
Register). The Departments reiterate that
States will be required to report on the
measurable skill gains indicator as set
forth in § 677. 155( a)( 1)( v), consistent
with program guidance. No change to
the regulatory text is being made in
response to these comments.
Comments: Many commenters
strongly supported the fact that the
proposed regulations recognize the
intent of Congress to " encourage local
adult education programs to serve all
low -skilled adults," and stated that the
measurable skill gains indicator will
help to achieve that goal. One
commenter suggested that measurable
skill gains should be the only indicator
of performance required for students
functioning below the ninth grade level.
Departments' Response: The
Departments do not agree with the
suggestion that the measurable skill
gains indicator be the only indicator of
performance for students functioning
below the ninth grade level since WIOA
requires that the indicators of
performance apply across all core
programs in order to assess the
effectiveness of States and local areas in
achieving positive outcomes for
participants served by those programs.
There is no basis for a blanket
exclusion from all performance
indicators except the measurable skill
gains indicator for participants
functioning below the ninth grade level.
Such participants have the potential to
receive services under a program, be
included in performance calculations,
and be counted as having met one of the
other indicators. Therefore, unless a
student functioning below the ninth
grade level is otherwise appropriately
excluded from participants included in
the performance calculations for a
particular indicator under
677. 155( a)( 2), the Departments will
not categorically exclude such students
functioning below the ninth grade level
from the other five indicators of
performance. No change to the
regulatory text is being made in
response to these comments.
Comments: The majority of
commenters endorsed continued use of
educational functioning levels (EFLs)
and encouraged eventual refinement of
EFLs or the development of other
potential measures that can document
participants' progress toward
educational goals. Other commenters
expressed concern because in high
intensity programs, students may
advance two or more EFLs; therefore,
the proposed language would not
capture the full impact of adult
education instruction. The commenters
recommended that the requirement
should be " the achievement of the EFLs
of the participant."
Departments' Response: As set forth
in the preamble of the NPRM, the first
standardized way States could measure
and document participants' measurable
skill gains is the documented
achievement of at least one EFL of a
participant in an education program that
provides instruction below the
postsecondary level. The Departments
agree with comments that supported the
continued use of EFLs to measure
progress towards the measurable skill
gains indicator. The Departments also
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recognize that in some cases, students
may advance more than one EFL during
a program year. However, for purposes
of the performance calculations,
programs will be permitted to report
only one EFL measureable skill gain per
a participant' s exit from the program
through the WIOA Joint Performance
ICR. This means that if a participant
exits a program more than once in a
program year and attains an EFL
measureable skill gain prior to exiting
each time, then the program will be able
to report, for performance calculation
purposes, more than one EFL
measureable skill gain for the
participant in a program year. In so
doing, participants, for purposes of
performance calculation purposes with
respect to the measureable skill gains
indicator, will be treated the same as for
any other performance indicator. Having
said this, through the WIOA Joint
Performance ICR, the Departments will
require States to provide unique
identifiers for participants. Thus, there
will be a unique count of participants
under the core programs regardless of
how many times the participant exits
the program (see discussion in this
preamble regarding the definition of
exit" in § 677. 150( c) above). The
Departments have added
677. 155( a)( 1)( v)(A) to include
documented achievement of at least
one educational functioning level of a
participant receiving instruction below
the postsecondary education level," as
one way of measuring documented
progress under the measurable skill
gains indicator. Options for measuring
educational functioning level gain are
described in the WIOA Joint
Performance ICR.
Comments: A commenter
recommended that attainment of a high
school diploma not be included as one
of the measures of documented progress
for purposes of the measurable skill
gains indicator.
Departments' Response: The
Departments disagree with the assertion
and consider attainment of a secondary
school diploma a valuable measure of
progress and have therefore revised
677. 155( a)( 1)( v)(B) to include
documented attainment of a secondary
school diploma or its recognized
equivalent."
Comments: Commenters stated that a
lower requirement of six credit hours
per semester better reflects the
capability of adults who must work to
provide for their families. Another
commenter suggested that the measure
should be expanded to include a
demonstration of semester -to -semester
retention, which is a key indicator of
academic success.
Departments' Response: As proposed
in the preamble of the NPRM, the third
standardized way States could measure
and document participants' measurable
skill gains is through a transcript or
report card for either secondary or
postsecondary education. The
Departments had proposed a measure
requiring a transcript or report card for
1 academic year or for 24 credit hours.
The Departments agree with the concern
that a transcript for 1 academic year or
24 credit hours is too onerous for part-
time students and have changed this
measure to require that the transcript or
report card reflect a sufficient number of
credit hours to show a participant is
achieving the State' s academic
standards. The Departments' current
standard for a sufficient number of
credit hours is at least 12 hours per
semester or, for part-time students, a
total of at least 12 hours over the course
of 2 completed consecutive semesters
during the program year that shows a
participant is achieving the State unit's
academic standards. The Departments
have added § 677. 155( a)( 1)( v)(C) to read
secondary or postsecondary transcript
or report card for a sufficient number of
credit hours that shows a participant is
meeting the State unit' s academic
standards." Clarification regarding the
progress measures and the specific
requirements for collection and
reporting will be provided through the
Departments' WIOA Joint Performance
ICR, Department -specific ICRs, and
programmatic guidance.
Comments: A commenter suggested
that the Joint WIOA Final Rule identify
progress reports from training providers
as an acceptable measure of
documented progress for purposes of
the measurable skill gains indicator.
Departments' Response: As proposed
in the NPRM, the fourth standardized
way States could measure and
document participants' measurable skill
gains is through a satisfactory or better
progress report towards established
milestones from an employer who is
providing training. Such milestones to
be achieved could include completion
of on-the-job training (OJT) or
completion of 1 year of an
apprenticeship program. The
Departments agree with the commenter
that progress reports from training
providers as to achievement of
established milestones also could be
acceptable and note that when
participants are enrolled in training
programs, the training providers are in
the best position to report on
participants' progress toward
established milestones. The
Departments emphasize that rigor is
expected in determining whether a
progress report is satisfactory, whether
from an employer or a training provider.
The Departments have added
677. 155( a)( 1)( v)(D) to include
satisfactory or better progress report,
towards established milestones, such as
completion of OJT or completion of 1
year of an apprenticeship program or
similar milestones, from an employer or
training provider who is providing
training."
Comments: Several commenters
requested information on how progress
shall be measured under the VR
program.
Departments' Response: With regard
to the VR program, there may be several
methods for obtaining documentation
related to measuring progress. For
example, documentation such as
standardized reports of progress from
training providers, provided to the State
VR agency, may be used to substantiate
progress. To adequately document
progress, programs should identify
appropriate methodologies based upon
the nature of the service being provided.
For example, VR agencies frequently use
grade reports from postsecondary
educational institutions to document a
student' s progress toward achieving a
degree. For OJT, where the individual is
being trained on site by either the
employer or by a vendor, VR Counselors
receive regular training reports that
include the OJT milestones completed
as the individual masters the job skills
required. More broadly, for
apprenticeship programs, the milestones
are already incorporated into the
process. The steps required to complete
the apprenticeship and the increases in
pay that occur can be used to document
progress.
Comments: Some commenters
recommended that successful
completion of an exam, as
recommended in the preamble of the
NPRM as a way of measuring
documented progress, be understood as
achieving a passing score on the exam.
Departments' Response: As proposed
in the preamble of the NPRM, the fifth
standardized way States could measure
and document participants' measurable
skill gains is through successful
completion of an exam that is required
for a particular occupation, or through
progress in attaining technical or
occupational skills as evidenced by
trade -related benchmarks such as
knowledge-based exams. The
Departments agree with the commenters
that this measure documenting a
measurable skill gain should require
that a participant achieve a passing
score on an exam and thus have added
677. 155( a)( 1)( v)(E), which requires
successful passage of an exam that is
55844 Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
required for a particular occupation, or
progress in attaining technical or
occupational skills as evidenced by
trade -related benchmarks such as
knowledge-based exams." Joint
guidance will be issued about what
qualifies as a trade -related benchmark to
show documented progress for purposes
of the measurable skill gain indicator.
Comments: Commenters expressed
concern about another measure of
documented progress proposed in the
preamble to the NPRM—measurable
observable performance based on
industry standards. Commenters
indicated that it would be very
challenging to identify a way to
document this type of gain.
Departments' Response: The
Departments agree with the
commenters' concerns that it would be
difficult to articulate a method for
documenting progress using
measurable, observable performance
based on industry standards. The
Departments did not include this
measure in § 677. 155( a)( 1)( v).
Comments: Commenters
recommended using other measures of
progress including achievement of
passing grades, completion of high
school equivalency (HSE) subtests,
receipt of postsecondary education or
training, completing some adult
diploma requirements, and obtaining
U.S. citizenship to document
measurable skill gains. A commenter
suggested that employment-related
indicators of skill gains, such as
employment in the participant' s
program of study, advancement in job
titles, and performance-based wage
increases, recognize that skills
attainment correlates with career
progression. One commenter
recommended that a high school
credential from another country should
be treated as sufficient in meeting the
requirement. Some commenters
suggested that the metric should
measure completion of something easily
definable such as a degree, certification,
or entrance into a program. A
commenter asked the Departments to
measure interim progress, including
documented gains in achieving " soft
skills," such as program attendance,
timely arrival, gains in proper behavior,
and creating an IPE. Another commenter
asked whether proceeding through a
prescribed program toward a secondary
degree would be considered " achieving
measurable skill gains." One commenter
cautioned about subjectivity in deciding
positive gains. One commenter stated
that the measurement should be simply
making progress—yes or no."
Departments' Response: The
Departments reviewed all of the
additional suggestions for measurement
of documented progress under the
measurable skill gains indicator and
concluded that none of the additional
suggestions would be included in the
Joint WIOA Final Rule or WIOA Joint
Performance ICR. The Departments
concluded that subjectivity should not
be a part of determining skill gains and
have included five objective progress
measures that States may use in
implementing the measurable skill gains
indicator of performance. These
indicators are sufficiently broad as to
provide flexibility that addresses some
of the commenters' concerns, while
maintaining rigor. Several of the
measures suggested by commenters
e.g., achieving soft skills) do not share
the same level of rigor or objectivity.
The Departments will provide further
clarification, definition, and
specification in the WIOA Joint
Performance ICR.
Comments: Another commenter
suggested the Departments empanel
expert working groups to assist in
developing measures of skill gains. A
commenter suggested that regional or
local workforce boards be allowed to
assign the WIOA defined skill gains
indicator to particular education or
training programs based on program
curriculum and goals. One commenter
recommended allowing the Local WDB
to define industry -related credentials or
eliminating work -based learning from
the measurable skill gains indicator.
Another commenter agreed that work -
based training activities, such as on-the-
job training, should be exempt from this
indicator.
Departments' Response: The
Departments acknowledge the various
points raised with regard to objective
measures that are implemented in a
rigorous manner. The Departments
have, through the WIOA Joint
Performance ICR, jointly coordinated
the development of the underlying
calculations, specifications, and
operational definitions of the
documented progress measures under
this indicator. This will ensure
measures uniformly are implemented in
a rigorous and objective way. In
addition to the WIOA Joint Performance
ICR, each core program will define
through guidance, the types of skill
gains that are appropriate for the
services provided and whether the
program is an education or training
program that leads to a recognized
postsecondary credential or
employment. For example, work
experience in the WIOA title I youth
program may not be considered an
education or training program and,
therefore, the measurable skill gains
indicator may not apply to those
participants engaged only in work
experience under the WIOA title I youth
program. More guidance regarding
education and training programs is
provided in 20 CFR part 680 ( see DOL
WIOA Final Rule published elsewhere
in this issue of the Federal Register). No
change to the regulatory text is being
made in response to these comments.
Comments: Commenters asked for
specificity and guidance about the
comparator group/ cohort;" how to
most efficiently collect documentation
such as confirmation by phone or
email); industry -specific recognized
credentials; how time intervals would
be used for skill gains; how the measure
applies to shorter -term training
programs that are completed within 1
year; how different measures could be
used for different trainings; whether
Indian and Native American youth are
included in this indicator; and
definitions and timing regarding when a
measurable skill gain must have
occurred in order to he counted.
Departments' Response: The
Departments recognize that the
regulation poses broad parameters for
these indicators. Many concerns and
requests for clarity by commenters were
identified and will be explained within
the WIOA Joint Performance ICR or
Department -specific ICRs, which are
designed to operationalize such aspects
of collection and reporting as time
periods, specific calculations, details
regarding who is included, and where to
record positive outcomes. In addition to
the WIOA Joint Performance ICR, the
Departments will provide further
guidance on acceptable source
documentation, and the definitions
recommended by commenters. In
addition, the Departments will provide
program -specific guidance for programs,
such as the Indian and Native American
youth program, on the application of
performance indicators in their
respective regulations and in guidance.
Comments: In the preamble to the
NPRM, the Departments sought
comments on whether time intervals
should be required when implementing
the measurable skill gains indicator and
if so, what time intervals might be. One
commenter suggested that specific time
intervals should not be required because
of variation in services across and
within core programs and because
individuals at different levels take
different amounts of time to show gain.
Other commenters agreed that a time
requirement should not be used for
determining measurable skill gains.
Certain commenters, however,
recommended that time intervals be
established in a manner that is flexible
55845Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
enough to meet the varying durations of
service across core programs, from 1
month to an academic year, but those
time intervals should not adversely
affect the provision of services based on
the particular needs of a customer. One
commenter stated that, for youth under
WIA, the skill gains and literacy/
numeracy gains are effective for a
participation year. However, if a
customer enrolls in education or
training toward the end of a program
year, it will result in a negative outcome
due to the customer not having enough
time to obtain the skill gain before June
30. This commenter recommended that
any participants, adult or youth, who
were enrolled less than 90 days prior to
the program year end, and are
continuing services into the next
program year be allowed to continue as
an active participant, and considered
enrolled in Year 1, and in progress in
Year 2, with expected completion in
Year 2. Another commenter supported a
minimum program duration threshold,
and suggested that measurable skill
gains generally should not be available
to programs that are shorter than sixteen
weeks. Another commenter suggested a
time period of measurement set at the
first anniversary of enrollment and each
year thereafter.
Departments' Response: The
Departments considered whether a
minimum time threshold should be
incorporated into the measurable skill
gains indicator. The Departments have
concluded that, given the diversity of
participant needs and program services,
imposing a time period by which
progress is to be documented would be
somewhat arbitrary and difficult. Such
practice could result in excluding a
number of participants from
performance accountability reporting
requirements, even if those participants
would achieve a gain under one of the
measures of progress. The Departments
recognize that participants enrolling late
in the program year may not have
enough time to achieve a measurable
skill gain prior to the end of the first
program year, and the Departments
recognize this could be perceived as
negatively impacting performance.
However, the negotiation process can
and should take into account enrollment
patterns and lower baseline data when
setting targets for the measurable skill
gains indicator. The Departments are
concerned about incentivizing behavior
that discourages service providers from
enrolling disconnected youth in
particular when they first approach
programs, or that purposefully attempts
to focus service on individuals who are
more likely to obtain a positive
outcome. The Departments emphasize
that programs must not delay
enrollment or prohibit participants from
entering a program late in the program
year. All participant outcomes,
regardless if achieved at the end of the
reporting period in which they enrolled
or in the next reporting period, count as
positive outcomes for the program. No
change to the regulatory text was made
in response to these comments.
The Departments will define, through
program guidance, the types of services
and trainings that constitute " an
education or training program that leads
to a recognized postsecondary
credential or employment," applicable
for each of the core programs. All
participants who enrolled during a
program year in an education or training
program that leads to a recognized
postsecondary credential or
employment are counted each time the
participant exits the program during a
program year.
Comments: In the preamble of the
NPRM, the Departments also asked for
comments on whether the negotiated
levels of performance for this indicator
should be set at the indicator level or
the discrete documented progress
measure (e.g., attainment of high school
diploma) level. Setting the negotiated
levels of performance at the indicator
level would aggregate results for all
documented progress measures (i.e.,
achieving any or several of measurable
skill gains would be recorded as a
success). Setting the negotiated levels of
performance based on discrete
documented progress measures would
separately set targets for each indicator
and each measurable skill gains. The
vast majority of these commenters
preferred that the performance targets
for this indicator be set at the indicator
level rather than at the documented
progress level. Other commenters,
however, suggested that standardization
is more easily achieved by linking the
target to a documented progress
measure level, stating that targets based
on documented progress, versus an
indicator, may be easier to collect.
Another commenter suggested that
performance targets should include both
indicator and documented progress
measures.
Departments' Response: After
considering the comments received, the
Departments agree with the majority of
commenters that supported setting the
target ( or the adjusted level of
performance) at the indicator level. The
Departments have concluded this will
provide a more streamlined and user-
friendly approach to using progress
measures and will result in a more
uniform application of the measurable
skill gains indicator. Guidance on
negotiating adjusted levels of
performance that contains specific
information about setting targets for
Measurable Skill Gains will be issued by
the Departments. No change to the
regulatory text is being made in
response to these comments.
Section 677.155(a)( 1)( vi) implements
the sixth statutory indicator as
described in sec. 116(b)( 2)( A)(i)(VI) of
WIOA, subject to sec. 116(b)( 2)( A)(iv).
This indicator measures program
effectiveness in serving employers.
Under WIOA, the Departments must
consult with stakeholders and receive
public comment on proposed
approaches to defining the indicator. As
part of this requirement, in addition to
seeking public comment through the
NPRM and the WIOA Joint Performance
ICR, the Departments previously sought
public input on performance indicators
generally and on the business indicators
specifically through several avenues,
including a town -hall meeting that
addressed all of the primary indicators,
a town -hall meeting convened with
employers, and additional town -halls
and webinars on WIOA across the
country as well as consultations with
State Administrators for AEFLA
programs and VR stakeholders. As
described more fully below, the
Departments received many comments
regarding the three proposed definitions
of this indicator. After considering the
responses received through all venues,
the Departments are initially
implementing this indicator in the form
of a pilot program to test the rigor and
feasibility of the three proposed
approaches, and to develop a
standardized indicator. The
performance indicator for effectiveness
in serving employers will not be
included in sanctions determinations
until the standardized indicator is
developed.
Proposed Approaches to Measuring
Employer Satisfaction
Comments: The preamble to the
NPRM described three approaches to
measure employer satisfaction (i.e.,
effectiveness in serving employers). In
the first approach, States would use
wage records to identify whether or not
a participant matched the same FEIN in
the second and fourth quarters. Many
commenters opposed this approach
because participants may have
relocated, joined the military, or found
a better job, although these
circumstances do not mean the
employer was not satisfied. They also
opposed this approach because the mere
fact that an individual is employed with
the same employer does not mean that
55846 Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
the employer is satisfied. Many other
commenters, however, favored the
approach because it would be the least
disruptive to employers. A commenter
agreed that employee retention can be
measured, but that measure does not
take into account the quality of the
placement. Commenters suggested
piloting a limited demonstration using
existing data to determine if the
variability in the types of occupations in
a particular local area has a more
profound impact on retention than the
value added by the services provided
under a WIOA program, and to
determine whether there is a correlation
between retention and effectiveness.
The second approach to define this
indicator would measure the repeated
use rate for employers' use of the core
programs. Many commenters did not
support this approach because some
employers may not have many hiring
needs during a program year, or an
employer may have a need but the
program has no students who are ready
to graduate and go to work. Also, this
approach would encourage programs to
protect their individual employer
relationships rather than working
collaboratively through sector
partnerships. Several commenters
recommended use of this measure along
with the number of workers employed
by businesses participating in sector
partnerships. Other commenters
supported the approach because it
represents increased use, retention, or
growth of business engagement,
although some commenters would use
the number of workers employed, not
the number of businesses served. The
preamble to the NPRM specifically
sought comments on how States could
capture this data, the feasibility of
capturing and reporting this data, and
queried whether this indicator would
measure the efficacy of services
provided to employers. The
Departments received both positive and
negative comments regarding this
approach.
The third approach would use the
number or percent of employers that are
using the core program services out of
all employers represented in an area or
State served by the system (i.e.,
employers served). A large proportion of
commenters opposed this approach and
warned that this saturation method only
would work if all participants come
from the local market area; for a number
of programs, it is usually not the case
that most of the participants come from
the local market area. Also, the
commenters asserted that this option
would focus too much on the breadth of
employer involvement, rather than the
depth or quality. Some commenters
supported this approach when used
with another approach. The preamble to
the NPRM specifically sought comments
on how States could capture this data,
the feasibility of capturing and reporting
this data, and queried whether this
indicator would measure the efficacy of
services provided to employers. The
Departments received both positive and
negative comments regarding this
approach.
Departments' Response: After further
review, analysis, and consideration of
public response, the Departments have
concluded that too little is known with
regard to the validity and reliability of
each of the proposed approaches. In
concurrence with multiple commenters,
the Departments have concluded that
the retention method, using wage record
FEIN matches to be the least
burdensome method to employers for
measuring the quality of service
provided to employers given that the
outcome is concluded solely by the use
of wage -match data, which prevents
outside factors from influencing the way
success is measured within the
reporting system. The Departments
concluded, however, that there was not
enough evidence that this point of
measurement would encompass the
intent of this indicator. Therefore, the
Departments have proposed a pilot
allowing all three approaches, and any
additional measure that the Governor
may establish relating to services for
employers, with the intent of assessing
each approach for its efficacy in
measuring the effectiveness in serving
employers.
The Departments have included these
approaches in the WIOA Joint
Performance ICR and will require each
State to choose two of the three
approaches set out in the NPRM as well
as any additional measure that the
Governor may establish related to
services to employers, with results to be
included in the first WIOA annual
report due in October 2017. This
approach provides States flexibility in
selecting the measures that best suit
their needs, while providing partner
Agencies the opportunity to evaluate
States' experiences in using these
measures during PY 2016 and PY 2017,
and additionally allows the
Departments to obtain employer
feedback regarding the extent to which
these indicators measure effectiveness
in serving employers. The Departments
will evaluate State experiences with the
various indicator approaches and plan
to use the results of that evaluation to
identify a standardized indicator that
we anticipate will be implemented no
later than the beginning of PY 2019. In
this process, the Departments intend to
engage the National Association of State
Workforce Agencies (NASWA) and the
States to inform the evaluation design;
communicate how States fare in
operationalizing the measures; and
contribute to the development of
technical assistance activities and tools.
The Departments acknowledge the
dissatisfaction expressed by
commenters with using each of the
NPRM proposed measures as a sole
indicator of successful service to
employers and agree with comments
discussing the utility of piloting
multiple alternative measures to ensure
that States are being required to report
on employer satisfaction in the most
effective manner. As such, the
Departments will work to implement a
pilot program, the details of which will
be further delineated in joint
Departmental guidance. The
Departments have opted to implement a
pilot program using all of the
approaches in order to assess the States'
experiences with these and evaluate the
efficacy of such approaches in
measuring this construct. Further
guidance regarding the pilot program
will be provided.
Effectiveness in Serving Employers
across Programs
Comments: The NPRM also sought
comment on using effectiveness in
serving employers as a shared indicator
across programs, as many employers are
served by multiple programs. Many
commenters supported using
effectiveness in serving employers as a
shared indicator across programs
because it would foster collaboration
rather than competition among the core
programs. One commenter stated that
using effectiveness in serving employers
as a shared indicator would mitigate
concerns regarding measuring
effectiveness in serving employers for
the Wagner-Peyser Act program.
Commenters stated that there are too
many indicators already and a single
metric should suffice. Commenters also
suggested that the Departments should
engage the employer community, such
as using a short survey or task force, to
discover methods of measuring
effectiveness. One commenter, however,
opposed employer surveys and
burdensome employer contacts. A group
of commenters recommended that
agency directors conduct a study on
how effectively workforce development
aligns with business needs. Others
favored having States create and submit
for approval an indicator that meets the
State' s current needs, including targeted
sectors and partner collaboration. A
commenter suggested that the workforce
system offer one point of contact or
55847Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
account executive" to each employer.
However, one commenter opposed the
use of a shared indicator, and
recommended measuring at an
individual program level in order to
measure the impact on each core
program.
One commenter developed a novel
approach for measuring effectiveness
and provided details in a concept paper,
which was expressly supported by some
commenters. The approach includes a
customizable point -menu system that
would award varying levels of points to
WDBs based on the degree of intensity
and the value of services provided.
Services earning high points would
clearly reflect deeper relationships with
employers and activities that are the
result of longer-term relationships. The
Departments will consider this
approach in the course of the pilot
program. A separate commenter
suggested using tiers to measure
employer engagement with concrete
examples. The Departments also will
further consider this suggestion of a
tiered approach.
The preamble to the NPRM also
requested feedback regarding whether a
single metric for this indicator would
sufficiently capture effectiveness in
serving employers or if this indicator
should encompass a combination of
metrics, as well as how these metrics
could most effectively be combined. A
number of commenters expressed
concern or disinterest with using a
single metric to measure effectiveness in
serving employers.
A few other commenters who
expressed support for using multiple
metrics for this indicator recommended
a list of core functions to indicate the
effectiveness in serving employers, with
the list of core functions including
strategic planning with business to
identify business needs; outreach and
recruitment; hiring; retention; training,
consultation services, and other
customized services; and business
customer satisfaction with services
provided. One commenter added
preparing workers for in -demand
industries and occupations and the
percentage of participants who earn an
industry credential. Some commenters
also mentioned fill rate—the number of
job seekers placed against the number of
open job orders in the system—and
employer referrals. A few commenters
stated that there is insufficient clarity on
the employer satisfaction indicator and
the meaning of effectiveness.
Departments' Response: The
Departments have concluded that
implementing the effectiveness in
serving employers indicator as a shared
indicator across all core programs to be
the most useful approach based on the
collaborative nature of this method and
the overwhelming majority of
commenters who were in favor of this
option. In doing so, States and local
areas are better positioned to provide a
single point of contact to each employer,
making it easier for the differences
between specific core programs to
become invisible and enable the
programs to serve together as a unified
front. Measurement at the program level
would be contrary to WIOA' s efforts to
streamline reporting across programs,
reduce burden on employers, and
decrease the likelihood of duplicated
employer counts. In keeping with such
efforts, the Departments have opted not
to require employers to fill out any
additional surveys. The Departments
had, however, prior to the publication of
the NPRM, engaged in multiple
meaningful exchanges with the
employer community to receive
feedback on the most appropriate ways
to assess the utility of the public
workforce system for businesses.
In addition, through the
implementation of the previously
mentioned pilot program, the
Departments will seek to discover the
best methods for assessing how well
workforce development aligns with
business needs. There were a number of
noteworthy measures suggested by State
workforce agencies and nonprofit
organizations, some of which will be
included in the pilot, giving the
Departments an opportunity to review
some of the alternative methods that
would help States to improve current
relationships and establish strong future
relationships with local employers, such
as using the fill rate, employer referrals,
the level of employer engagement,
allowing any additional measure that
the Governor may establish relating to
services for employers, participation in
targeted sector partnerships, the
inclusion of recruitment, training, and
other pre -hire services as part of the
performance metric, using tiers to
measure employer engagement, and the
use of already existing electronic, or
wage record data along with a myriad of
other valuable recommendations. The
Departments acknowledge the value of
using a combination of metrics as
pointed out by a number of commenters
and will seek to delve further into the
benefits of such an option through the
use of the upcoming pilot program. No
change to the regulatory text is being
made in response to these comments.
Comments: One commenter stated
that the provision is not applicable to
the INA program because it is not a core
program. Another commenter requested
that the measurement of effectiveness of
serving employers be eliminated as a
measure for Adult Education and
Literacy because the program already
works closely with Career and
Technical Education, the workforce
system, and industry to ensure that it is
providing programs and services to meet
the needs of employers. A commenter
recommended that any finalized
measure not allow a program to be
penalized because of factors beyond its
control. Another commenter requested
information about feedback obtained at
the stakeholder meetings that involved
employer partners.
Departments' Response: The
Departments recognize that the INA
program is not a core program.
However, WIOA sec. 116( e)( 5) requires
that the performance accountability
indicators (which include effectiveness
in serving employers) be used to assess
performance, and WIOA sec. 116(h)(2)
requires agreement on the adjusted
levels of performance for all of the
primary indicators be reached between
the Secretary of Labor and the entity
carrying out activities under this
section.
In response to the comment
requesting that the measurement of
effectiveness of serving employers be
eliminated as an indicator for the
AEFLA program, the Departments have
no authority to exempt AEFLA
programs from the indicator regarding
effectiveness in serving employers.
WIOA sec. 116(b)( 2)( A) explicitly
requires that the State primary
indicators of performance for the
AEFLA activities authorized under title
II, as well as for other specified
programs and activities, shall include
indicators of effectiveness in serving
employers. In response to concerns
about programs being required to
account for factors beyond their control,
the Departments refer to § 677. 170 and
the associated discussions regarding
factors to be considered when coming to
agreement on negotiated levels of
performance, including the objective
statistical model. The Departments have
provided a summary of comments
raised at stakeholder meetings and
during the regulatory process above. No
change to the regulatory text is being
made in response to these comments.
Comments: Commenters expressed a
great deal of concern regarding the
implementation of an indicator that
would likely cause undue penalty.
Departments' Response: The
Departments note that this concern
weighed heavily in the decision to allow
employee retention to serve as a means
of measuring employer satisfaction. The
Departments also note that concerns
regarding penalties are an issue that will
55848 Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
be greatly ameliorated with the use of
benchmark target setting via the
statistical adjustment model. The
statistical adjustment model also will
address issues such as size
discrepancies across States and local
areas, labor shortages, and other
external factors and provide objective,
realistic goals for improvement.
Application of the statistical model to
both set targets and apply sanctions is
most effective when assessing
quantitative metrics, with the use of
qualitative metrics making both efforts
exponentially more complex. It is for
this reason that, although the
Departments understand the
significance of using such methods to
evaluate quality service to employers,
more qualitative metrics were not
included as part of the effectiveness in
serving employers indicator.
As previously stated, a great deal of
discussion regarding these and other
proposed methods for measuring this
indicator took place during previous
webinars and town halls with State
workforce agencies, members of the
employer community, and other
stakeholders. The outcome of these
discussions was the three options listed
within the NPRM. Understanding the
importance of receiving extensive
feedback on this issue, the Departments
requested further input via the NPRM
and the proposed WIOA Joint
Performance ICR, the responses for
which can be found on regulations.gov.
No change to the regulatory text is being
made in response to these comments.
Section 677.155(a)(2). The
Departments added a new paragraph
677. 155( a)( 2) after considering public
comments received in response to the
proposed WIOA Joint Performance ICR,
particularly with regard to discrete
populations that would be excluded
from performance calculations. As
noted in both the preamble to the NPRM
and the supporting statement to the
proposed WIOA Joint Performance ICR,
because of the close relationship
between the two documents, the
Departments informed the public that
comments on either the NPRM or the
proposed WIOA Joint Performance ICR
would be used to form the basis for
necessary changes in both the Joint
WIOA Final Rule and the finalized
WIOA Joint Performance ICR. After
reviewing WIOA sec. 116, the
Departments have concluded that the
purpose of the performance
accountability system is to measure a
program' s performance with respect to
the populations served and the services
provided. A program' s performance
should be measured in terms of
populations it is designed to serve or
services it is designed to provide. In so
doing, the performance accountability
system will measure a program' s
performance more precisely. Given that
sec. 116(f) of WIOA imposes sanctions
for poor performance, it is critical that
the Departments receive data that
accurately reflect a program' s
performance. Explicitly defining which
participants will be included in
performance indicator calculations will
allow a program' s performance to be
assessed appropriately. It is for this
reason that the Departments proposed
certain " exclusions" in the proposed
WIOA Joint Performance ICR.
The Departments have added
language in the Joint WIOA Final Rule
at § 677. 150( a)( 2)( i) to exclude
individuals receiving services under
sec. 225 of WIOA from all primary
performance indicators for purposes of
performance accountability, except the
measurable skill gains indicator
677. 155( a)( 1)( v)). This is because the
measurable skill gains indicator is the
only performance indicator applicable
to this population. In so doing, the
Departments ensure programs serving
these individuals will not be
inadvertently subject to low
performance levels with regard to those
indicators not applicable to sec. 225
participants.
Section 677. 150( a)( 2)( ii) allows the
Secretaries of Labor and Education to
make further decisions as to the
participants to be included in
calculating program performance levels
for other purposes that are necessary
with regard to any of the primary
performance indicators. Further
information about those exclusions is
provided through the WIOA Joint
Performance ICR and related guidance.
Section 677. 155( b)— Indicators for the
Employment Service Programs
Paragraph (b) of §677.155 remains
unchanged from that proposed in the
NPRM. The Departments did not receive
any comments regarding this provision.
Section 677. 155( c)— Indicators for the
Youth Program
Paragraph (c) of §677.155 implements
the primary indicators for the WIOA
title I youth program, as described in
sec. 116(b)( 2)( A)(ii) of WIOA. No change
to the regulatory text is being made in
response to public comments.
Comments: A few commenters
supported the fact that the common
performance indicators for youth
programs apply only to WIOA title I
youth programs. Some commenters
remarked that employment rate
measures are different for youth and
adults because the youth measure
allows enrollment in education and
training to be included in the indicator,
that this difference is likely to work
against co -enrollment. These
commenters suggested that 18 to 24 year
old individuals co -enrolled in the WIOA
title I youth program and other WIOA
programs only be included in the youth
indicators.
Departments' Response: Although the
Departments recognize that subjecting
such youth to adult and youth
employment rate indicators could serve
as a barrier to co -enrollment, WIOA
only authorizes the youth indicators for
the WIOA title I youth program and
does not authorize these indicators for
any other WIOA core program.
Comments: One commenter suggested
that the following outcomes count
toward the first two youth statutory
indicators as successful outcomes: (1)
Unsubsidized employment, (2) military
employment, (3) education (secondary
or postsecondary), (4) advanced training
long-term licensed or credentialed, for
example, registered nurse training), and
5) occupational skills training.
Departments' Response: The
Departments agree that these suggested
outcomes, and additionally registered
apprenticeships, are among the
successful outcomes for the first two
statutory indicators, but do not think
that any change to the regulatory text is
necessary to accommodate such
outcomes as successful. Specific
references to particular successful
outcomes will be included in the WIOA
Joint Performance ICR.
Comments: One commenter suggested
that supplemental data be allowed to
measure employment in the second and
fourth quarters after exit because UI
wage record data alone do not capture
the full spectrum of employment
options.
Departments' Response: The
Departments agree and have chosen to
permit the States to use non -wage
record matches ( supplemental
information) in calculating the
performance indicators, subject to use
consistent with the Departments'
guidance on this issue. More
information can be read about this in
the preamble to § 677. 175 below. That
guidance regarding the use of
supplemental wage data will be relevant
to the use of supplemental data to
determine employment status.
Comments: One commenter
recommended consideration of planned
short-term employment by youth as a
positive outcome, such as internships.
Another commenter requested that
service programs such as AmeriCorps,
NCCC, and Public Allies be counted as
unsubsidized employment." A
55849Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
commenter recommended that
placement in unsubsidized employment
or postsecondary education count as a
success regardless of the quarter in
which it occurs, rather than focusing
only on the second and fourth quarters
after exit. Similarly, one commenter
asked that attainment of initial
employment count as a successful
outcome (i.e., a placement rate).
Departments' Response: As required
by sec. 116(b)( 2)( A)(ii)(I) and (II) of
WIOA, only unsubsidized employment
will count as a positive outcome for
employment in the first and second
indicators. Internships that are
subsidized would not count as a
positive employment outcome, but they
are an important service in preparing
youth for unsubsidized employment.
However, service programs, such as
AmeriCorps, would count as a positive
outcome in the first and second primary
youth indicators because these service
programs are considered training for the
purposes of those youth indicators. The
Departments will clarify the
categorization of service programs in the
WIOA Joint Performance ICR. The first
and second primary youth indicators
measure the percentage of participants
in unsubsidized employment, or in
education or training activities, during
the second and fourth quarters after exit.
The Departments do not have the
authority to deviate from the WIOA
statute by counting participants' status
in the first and third quarters after exit,
or by counting participants as successful
simply upon attainment of initial
employment.
Comments: A few commenters
expressed concern that the requirement
to track educational attainment up to a
year after exit may prove infeasible. One
commenter favored alignment of
reporting that is required on post -school
outcomes.
Departments' Response: Although the
Departments recognize that tracking
attainment up to a year after exit is
difficult for an often -transient youth
population, the WIOA title I youth
program includes a follow-up services
program element that is required to last
not less than 12 months after
completion of participation. The
requirement to capture program
outcomes 1 year after exit is consistent
with the follow-up services program
element. In addition, follow-up services
help ensure youth receive the support
they need as they transition to the world
of work or postsecondary education.
Regarding alignment of reporting on
post -school outcomes, WIOA requires
the specific indicators for youth
programs identified in WIOA sec.
116(b)( 2)( A)(ii).No change to the
regulatory text is being made in
response to these comments.
Comments: A number of commenters
stated that the Departments only should
measure status of employment or
education in the second quarter after
exit, rather than an entered employment
or education rate that includes only
those not employed or not in education
prior to program enrollment. This
commenter also asked for a clarification
of the definition of education and
training activities related to the two
youth indicators that measure the
percentage of participants in
unsubsidized employment or in
education or training activities. One
commenter suggested that any type of
education should count in the two
youth indicators related to employment
or education or training.
Departments' Response: The
Departments agree that the first two
indicators only should measure status of
employment or education in the second
and fourth quarter after exit,
respectively, regardless of employment
or education status at enrollment. The
definition of education and training
activities related to the two youth
indicators will be included in the WIOA
Joint Performance ICR. Both secondary
and postsecondary education will count
as successful outcomes for the two
youth indicators related to employment
or education or training. No change to
the regulatory text is being made in
response to these comments.
Comments: Many commenters
addressed the third primary
performance indicator, which measures
median earnings in the second quarter
after exit. The commenters reasoned
that areas that are highly successful in
exiting youth to postsecondary
education and training should not be
penalized; therefore, youth who are
working part-time and are also in
education or training activities should
he excluded from the calculation of
median earnings. In addition, a
commenter suggested that the focus of
services to youth is education and
training and, therefore, a measure of
median earnings does not seem
appropriate.
Departments' Response: WIOA
requires all participants with earnings
in the second quarter after exit to be
included in the earnings indicator,
including participants engaged in
education or training programs.
Therefore, youth who are working part
time while in education or training
activities will be included in the
calculation of median earnings. Those
engaged in both employment and
education and training will be taken
into account in both the statistical
adjustment model and through target
setting. No change to the regulatory text
is being made in response to these
comments.
The fourth primary indicator for
youth measures attainment of a
recognized postsecondary credential, or
secondary school diploma or its
recognized equivalent, by participants
who are enrolled in an education or
training program (excluding those in on-
the-job training or incumbent worker
training), subject to the caveat that such
participants only are measured as
successes if the participant is also
employed or enrolled in an education or
training program leading to a recognized
postsecondary credential within 1 year
from program exit. The language of this
indicator is the same as the indicator in
677. 155( a)( 1)( iv). The Departments
have provided an in-depth explanation
of this in the preamble for
677. 155( a)( 1)( iv) above and refer
readers to this section for more
information on this indicator. No
particular comments were received
regarding the implementation of the
fourth primary youth indicator, other
than discussed above. The Departments
are implementing § 677. 155( c)( 4) as
revised.
The fifth primary indicator
documents measurable skill gains. The
language of this indicator is the same as
the indicator in § 677. 155( a)( 1)( v). The
Departments have provided an in-depth
explanation of these changes in the
preamble for § 677. 155( a)( 1)( v) above.
No particular comments were received
regarding the implementation of the
fifth primary youth indicator, other than
discussed above. The Departments are
implementing § 677. 155( c)( 5) as revised
and discussed in more detail above with
respect to § 677. 155( a)( 1)( v).
The sixth primary indicator measures
effectiveness in serving employers. The
Departments' approach for measuring
this indicator and the resulting changes
to the regulatory text are discussed in
significant detail in the preamble
discussion for § 677. 155( a)( 1)( vi) above
and that approach is applicable for this
indicator for purposes of calculating
performance under the title I youth
program.
Comments: A commenter suggested
that the proposed youth indicators in
677. 155( d)( 1) and ( 2) sufficiently
measure employer satisfaction and that,
to the extent that those measures do not
sufficiently measure employer
satisfaction, a brief survey could be
developed and administered to measure
employer satisfaction.
Departments' Response: The
Departments have concluded that the
effectiveness in serving employers
55850 Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
indicator is statutorily required as a
separate indicator from percentage of
participants in education or training
activities, or in unsubsidized
employment, during the second and
fourth quarters after exit from the
program. The Departments will be
implementing a pilot program, as
discussed above, to assess measures of
effectiveness in serving employers.
Comments: One commenter stated
that the introductory description
provided under this proposed section is
confusing regarding the primary
indicators, particularly when
distinguishing between the adult and
youth indicators. The commenter
suggested that the indicators of
performance for adults and youth be
separately described so there is no
confusion in the field as to which
indicators apply to each population
group.
Departments' Response: As suggested,
the Joint WIOA Final Rule separates
adult and youth indicators to avoid
confusion.
Comments: One commenter suggested
that the VR program report youth
performance separately just as title I
youth programs.
Departments' Response: Section
677. 155( d) of the NPRM contained the
performance indicators set forth in sec.
116(b)( 2)( A)(ii) of WIOA, which applies
only to the title I youth program. These
youth performance indicators are now
found in the final regulatory text at
677. 155( c). WIOA sec. 116(b)( 2)( A)(i)
requires all other core programs,
including the VR program, to comply
with the primary performance
indicators set forth in sec.
116(b)( 2)( A)(i) of WIOA and
677. 155( a)( 1). Therefore, there is no
statutory authority for the Departments
to do as the commenter suggests.
The Departments understand that the
VR program pays for training and
education needed for individuals,
including youth, to obtain employment.
Because the youth indicators in
677. 155( c) are not applicable to the VR
program, State VR programs are not
required to report outcomes under the
youth indicators. Adult and youth
performance outcomes can be
differentiated in the RSA -911 data, as
has always been the case, with no need
for additional reporting burden.
Section 677. 160 What information is
required for State performance reports?
Section 677. 160, which implements
sec. 116( d)( 2) of WIOA, identifies the
information States are statutorily
required to report in the State
performance report, including levels
achieved for the primary indicators of
performance. No substantive changes
have been made to this section.
Comments: Some commenters
expressed concern that in many States
and tribal nations it will be time-
consuming and costly to collect the data
and produce a report for all core
programs.
Departments' Response: The
Departments understand the concerns
expressed by some of the commenters
regarding the collection of data needed
to produce the annual reports and have
made every effort to minimize the
burden and cost to States by
incorporating only necessary data
elements in the Departments' data
collection instrument provided through
the WIOA Joint Performance ICR. Prior
to amending each Department' s data
collection instrument, considerable time
was taken to ensure the required data
elements collected would be consistent
across all core programs and that the
only elements added would be
necessary to meet the requirements
under sec. 116 of WIOA, thereby
minimizing the burden as much as
possible. Each core program will be
responsible for submitting performance
reports to their respective Federal
agency, just as has been done prior to
WIOA. Further, the Departments clarify
in this response that there is no
requirement in WIOA or the Joint WIOA
Final Rule that data reporting be
integrated among all core programs. As
discussed in more detail with respect to
the issue of " common exit" in the
preamble for § 677. 150( c) above, DOL
intends to work towards developing an
integrated reporting mechanism for the
core programs it administers. The
Departments are open to States wishing
to submit integrated performance
reports, but a single report submission
across core programs is not required. If
a State were to do this, it must ensure
that it reports on all required reporting
elements—both for the common
performance accountability system
under sec. 116 of WIOA and for each of
the program -specific reporting elements.
Comments: Commenters
recommended that the Departments
develop guidance, technical assistance,
or an integrated set of reporting
specifications that will allow States to
submit customer data in the same
format for each of the six core programs.
Departments' Response: The
Departments recognize the need for, and
will develop and disseminate, guidance
and associated technical assistance
related to the preparation and
submission of joint and WIOA title -
specific performance reporting, and the
WIOA Joint Performance ICR.
Comments: One commenter suggested
that the Departments, working with
State and local systems, should consider
how core programs can collect and
provide information on the amount of
training provided to program
participants.
Departments' Response: The
Departments acknowledge the comment
and have concluded that data that will
be collected through the WIOA Joint
Performance ICR associated with this
Joint WIOA Final Rule are sufficient to
meet the requirements of sec. 116(d)( 2)
of WIOA. Prior to imposing additional
information collection requirements, the
Departments must consider them in the
context of associated burden and cost.
The Departments have concluded that
the final information collections meet
the statutory requirement while
minimizing reporting burden to the
extent possible.
Comments: Commenters urged the
Departments to allow the State and local
agencies that administer the core
programs to have access to the data they
need, such as UI wage record data. A
commenter added that in some States, a
release of information form must be
signed by the participant. Another
commenter recommended that States
should be given the option to await the
results of the national data integration
workgroup before creating their State
interoperable system.
Departments' Response: With regard
to the commenters' concerns about the
availability of quarterly wage record
information and the need for, in some
cases, informed consent for the
disclosures required under applicable
privacy and confidentiality laws and
regulations for all programs, the
Departments did not modify this
regulation. The Departments are
developing, and will disseminate,
guidance that covers the allowable
disclosures and processes through
which disclosures can be made under
20 CFR part 603, 20 U.S. C. 1232g and
34 CFR part 99 and 34 CFR 361. 38.
Additionally, work is underway to re-
negotiate the Wage Record Interchange
System Data Sharing Agreements to
establish pathways to the wage record
matching required for all core programs
to meet their performance reporting
requirements.
Paragraph (a)( 1) of § 677.160 requires
the total number of participants served
and total number of participants exited,
disaggregated by the number of
individuals with barriers to employment
and by numbers of participants co -
enrolled in core programs. No change to
the regulatory text is being made in
response to these comments.
55851Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
Comments: Commenters supported
the provision in § 677. 160( a)( 1)( i) that
would require reporting to be
disaggregated by categories for
individuals with barriers to
employment. Commenters also urged
that the requirement apply to
reportable individuals" as well as
participants." Those commenters
generally suggested that the information
in the reporting requirements should be
disaggregated based on each disability
subset and not the entire group.
Departments' Response: The
Departments acknowledge the identified
potential benefits for State reporting of
disaggregated data for " reportable
individuals" in addition to
participants." For the purpose of
677. 160, the Departments are
addressing only the requirements for
States' annual performance report as
required under sec. 116( d)( 2) of WIOA,
which requires reports on only
participants. It should be noted that the
different core programs already collect
and report information pertaining to
reportable individuals" through their
separate individual reporting vehicles.
With regard to the discrete disability
categories, RSA currently collects a
number of data elements, including the
primary and secondary disability type,
for individuals who have been
determined eligible for VR services and
would be considered a " reportable
individual." The data can be
disaggregated in different categories,
including by disability type. The final
RSA -911, which is published
concurrently with this Joint WIOA Final
Rule, has been revised to align with the
additional WIOA requirements. No
change to the regulatory text is being
made in response to these comments.
Comments: A commenter
recommended that the requirement to
collect information on barriers to
employment be tied to the point at
which the initial IPE is signed.
Departments' Response: The
Departments recognize that different
State programs have a number of
questions regarding how each of the
core programs will collect the required
data elements, including at what point
required demographic information will
be collected to produce the most reliable
information and how the current
consumer information will be updated
to meet the new WIOA requirements.
These issues will be addressed through
guidance related to the WIOA Joint
Performance ICR or the Department -
specific ICRs. The Departments also
note that § 677. 150( a)( 1) defines
participants for the VR program as an
individual who has an approved and
signed IPE, and who has begun to
receive services. Therefore, data
elements required on " participants"
must comply with the definition
applicable to that term for the VR
program. No change to the regulatory
text is being made in response to these
comments.
Comments: Commenters inquired
about implementing a count of total
participants and total exiters,
disaggregated by co -enrollment in any of
the core programs. A commenter
expressed concern about being able to
obtain the information. For
disaggregated counts for those who
participated by co -enrollment as
required by § 677. 160( a)( 1)( ii),
commenters warned that integrated case
management and reporting systems
would need to be in place, and the
commenters requested technical
assistance regarding how core programs
housed in different agencies can share
and compare participant data to meet
reporting requirements. One
commenter, however, supported the
requirement to report data disaggregated
for co -enrollment in any of the core
programs.
Departments' Response: The
Departments acknowledge that the
absence of integrated case management
or integrated reporting systems poses
challenges to ensuring uniform and easy
access to data across programs. The
Departments have concluded that
integrated data systems would allow for
unified and streamlined intake, and case
management and service delivery, and
would overcome many such challenges.
The Departments also note that such
systems are not widely used or in place
currently at the State level, and
encourage States to examine ways in
which this may be developed or
implemented across core programs. The
Departments note that data system
integration ranges from data sharing
between existing systems to employing
consolidated systems. However, in the
absence of such systems, the
Departments encourage all programs to
ensure strong partnerships and
collaborative workspaces in which to
ensure all programs can meet their
reporting requirements. In addition to
planning and conducting training and
technical assistance on data sharing, the
Departments will issue joint guidance
for matching education and wage
records in order to assist States in
providing performance information
required under WIOA. Additionally, the
Departments will work with State and
Local WDBs, one-stop center operators,
and partners to achieve an integrated
data system for the core programs and
other programs to ensure
interoperability and the accurate and
standardized collection of program and
participant information. No change to
the regulatory text is being made in
response to these comments.
Paragraph (a)(2) of §677.160 requires
disaggregated performance levels based
on barriers to employment, age, sex,
race, and ethnicity. Certain commenters
favored this provision. No substantive
change was made to this section.
Paragraphs (a)( 3) through (a)( 7) of
677. 160 require information on
participants who received career
services and training services. The
Departments have revised
677. 160( a)( 3), ( 4), ( 6) and ( 7) to specify
that career services and training services
are two different services, not one type
of service. No change was made to
677. 160( a)( 5).
Comments: Several commenters
stated that tracking these detailed costs
would be overly burdensome and
exceed the value of the information
gained.
Departments' Response: The
Departments recognize the concerns
identified by the commenters about the
States' ability to collect data pertaining
to career services and training services,
including expenditures. However, the
data elements contained in the State
performance report, including the data
elements on career services and training
services, are required by statute. No
change to the regulatory text is being
made in response to these comments.
Comments: A few commenters
recommended that reporting begin with
a 1 year period and work up to 3 years.
Departments' Response: The
Departments have concluded that these
provisions are prospective provisions
that do not require retroactive collection
of information. Reporting begins in PY
2016, and by PY 2018 States will have
reported 3 years of data. No change to
the regulatory text is being made in
response to this comment.
Comments: Commenters asked for a
definition of " career and training
service" and the relationship to
vocational and training services" in the
VR program regulations.
Departments' Response: WIOA
defines both career services and training
services in sec. 134(c)( 2) and (c)( 3)( D),
respectively. Additionally, further
information is provided in § 678.430 of
this Joint WIOA Final Rule about career
services in the one-stop delivery system.
Although the definitions are contained
in statutory provisions relevant only to
the title I core programs, sec. 121 of
WIOA (which applies to all core
programs) requires each of the core
programs to provide career services and
training services, as applicable to the
program, thereby making those
55852 Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
definitions relevant to all core programs,
including the VR program. Furthermore,
these services are consistent with the
types of services provided by the VR
program and with the data collected
through the VR program' s RSA -911
collection instrument.
With respect to § 677. 160( a)( 3) ( 4), ( 6),
and ( 7), the Departments have revised
the regulatory text to address
commenter requests for clarity. The
previous language at § 677. 160( a)( 3)
referred to " the total number of
participants and exiters who received
career and training services for the most
recent program year and the 3 preceding
program years, as applicable to the
program." This has been revised to refer
to " the total number of participants who
received career services and the total
number of participants who exited from
career services for the most recent
program year and the 3 preceding
program years, and the total number of
participants who received training
services and the total number of
participants who exited from training
services for the most recent program
year and the 3 preceding program years
as applicable to the program." In so
doing, the Departments make clear that
career services and training services are
two different types of services, not one
type of service. The revised language is
also more consistent with the statutory
provision by referring to " participants
who exited" rather than " exiters" since
these final regulations define " exit," not
exiter." A similar revision was made to
677. 160( a)( 4). Likewise, proposed
677. 160( a)( 6) previously referred to
the amount of funds spent on each
type of career and training service for
the most recent program year and the 3
This
language has been revised to refer to
the amount of funds spent on career
services and the amount of funds spent
on training services for the most recent
program year and the 3 preceding
preceding program years."
program years, as applicable to the
program." A similar revision was made
to § 677. 160( a)( 7). These changes clarify
that the Departments interpret sec.
116( d)( 2)( D) to require the collection
and reporting on participants who
receive career services and participants
who receive training services, as well as
participants who exited from career
services and training services, as a
single point of collection and thus does
not require an itemized collection and
reporting on each of the various career
services or each of the various training
services that a program provides.
Instead, the amount to be reported is the
total amount spent on career services
and the total amount spent on training
services.
Comments: Paragraph (a)( 3) of
677. 160 requires reporting on the
number of participants and exiters who
received career services and training
services. A number of comments were
received regarding the difficulty of
tracking costs associated with
expenditures of funds on such services,
as required in paragraph (a)( 6).
Departments' Response: The
Departments will provide technical
assistance or guidance in regard to
tracking costs associated with
expenditures of funds on career and
training services.
No particular comments were
received in regard to § 677. 160( a)( 4).
Paragraph (a)( 5) of §677.160 requires
reporting on the percentage of
participants who obtained training -
related employment through WIOA title
I, subtitle B programs.
Comments: Some commenters warned
that determining what constitutes
training -related employment under
paragraph (a)( 5) is highly subjective and
requires clarification.
Departments' Response: The
Departments will provide more
information regarding what constitutes
training -related employment services
through the WIOA Joint Performance
ICR and through guidance. No change to
the regulatory text is being made in
response to these comments.
Paragraphs ( a)( 6) and (a)( 7) of
677. 160 require reporting on the
amount of funds spent on career
services and training services, and the
average cost per participant for
participants receiving career services
and training services.
Comments: Commenters requested
guidance on whether the average cost
per participant for career and training
services refers to the cost to serve the
individual or the costs of the career and
training services, and whether
administrative costs are included.
Separately, one of these commenters
also asked for the meaning of " type" of
service needed for disaggregation in
reporting under paragraph (a)( 6).
Departments' Response: The
Departments will provide guidance
regarding calculations of costs in the
WIOA Joint Performance ICR. The
Departments have revised
677. 160( a)( 6) to reflect the statutory
language, as WIOA did not require
reports on the amount of funds spent on
career services and training services to
be disaggregated by the type of career
service or training service. The language
of the regulation no longer refers to the
type" of service.
Paragraph (a)( 8) of § 677. 160 requires
that States report on the percent of the
State' s annual WIOA allotment
expended on administrative costs.
Comments: A commenter sought
clarification on whether this means the
percentage of each core program' s
annual allotment spent on
administrative cost, or the State as a
whole.
Departments' Response: The
Departments want to clarify that
677. 160( a)( 8) applies only with respect
to the allotment under WIOA sec. 132( b)
and not with respect to allotments
under other core programs. No change
to the regulatory text is being made in
response to this comment.
Paragraph (a)( 9) of § 677. 160 requires
information that facilitates comparisons
with programs in other States.
Comments: Some commenters
opposed a requirement for additional
data collection and preferred, for
example, development of shared tools/
surveys for measuring the quality of
services to one-stop center customers.
Departments' Response: The
Departments note that WIOA allows
consideration of information that is
necessary to facilitate comparison of
programs across States, which could
potentially include the development of
shared tools or surveys. No change to
the regulatory text is being made in
response to these comments. Further,
the Departments note that
implementation of this provision would
be accomplished through the
information collection request process.
Comments: The Departments also
sought comments on the potential
inclusion of a supplemental customer
service measure, including suggestions
on how to structure such a measure and
whether the inclusion of such a measure
would be valuable. Commenters did not
favor developing a universal access
point for customer feedback to be
provided with regard to the one-stop
centers, though other commenters
expressed support for State or local
measures of customer satisfaction. One
commenter asserted that such
information would serve as a foundation
for substantive strategic planning,
continuous improvement, program
research and evaluation, and the
dissemination of best practices
nationwide.
Departments' Response: The
Departments are considering various
mechanisms available to produce a
national measure of customer
satisfaction, with particular interest in a
measure akin to the net promoter score
used commonly in business and
industry. Additionally, the Departments
intend to collect information on
55853Federal Register / Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
customer satisfaction efforts used by the
State and local areas through the WIOA
Joint Performance ICR as well as
information on what States are doing to
leverage such information in the
management of their programs. The
Departments continue to welcome input
and participation from States and local
areas on how to capture customer
satisfaction as it pertains to usage of the
public workforce system.
Comments: Other commenters also
supported the provision and suggested
customer service measures to assess the
quality of services, but warned that
guidance is needed. A few commenters
reasoned that a customer service
measure is valuable only if the local
area receives the information and has a
mechanism to reach out to the customer
and make the experience better.
A few commenters warned that
obtaining the data would be difficult
and suggested that the measure should
be left to the discretion of the State or
local government. Commenters
recommended that the provision should
be part of the continuous improvement
process at the local level. In addition to
the approach described above, the
Departments also are interested in the
work that has been developed and used
at the State and local levels with regard
to customer satisfaction, as well as what
actions States and Local areas have and
will take in response to such feedback.
Departments' Response: At this time,
the Departments are not modifying the
regulatory text to regulate such
activities. As discussed above, the
Departments recognize that, a national,
State or local customer satisfaction
measure would require guidance and
technical assistance that will be
provided through the mechanisms
available such as the information
collection request process, which allows
for notice and public comment, program
guidance, and technical assistance. The
Departments reiterate their intent to
implement a uniform, national customer
satisfaction survey, applicable to both
participants and reportable individuals.
While this customer satisfaction survey
will not be tied to accountability
provisions, and the survey results will
not be factored into determinations of
sanctions, customer satisfaction will be
a factor considered in the certification of
one-stop centers. The Departments
anticipate the survey will encompass
two elements: A national net -promoter
score -type indicator will be issued
through the amended WIOA Joint
Performance ICR with a standard
methodology; and a State -based
methodology that States will develop
and States and Local WDBs will use for
one-stop center accountability and
customer service improvement. A focus
from the Federal level will be on
understanding what States and local
WDBs did with the results, which is
critical to using the data and
information gathered towards the
betterment of service delivery and
design. When the Departments collect
information on these activities, such
actions and instructions will be
conveyed through the information
collection process that is also subject to
notice and public comment.
Comments: Paragraph (a)( 10) of
677. 160 requires a State narrative
report regarding pay -for -performance
contracting. A local government
recommended that the Departments
provide a clear definition of pay -for -
performance contracts.
Departments' Response: The
Departments did not introduce a
definition of pay -for -performance
contracts under this section of the
regulation. The Departments refer to 20
CFR part 683, subpart E, where the
allowance and guidelines for pay -for -
performance activities is more fully
described (see DOL WIOA Final Rule,
published in this issue of the Federal
Register). Paragraph (a)( 10) of § 677.160
remains unchanged from that proposed
in the NPRM.
Paragraph (b) of §677.160 prohibits
the disaggregation of data for a category
in the State performance report if the
number of participants in that category
is insufficient to yield statistically
reliable information.
Comments: Commenters suggested
that States are likely to have several
cell sizes" that do not meet the
standard of statistical reliability;
therefore, reporting requirements should
include alternative methods for
summarizing data into larger aggregates.
A commenter requested guidance on an
acceptable level of disaggregation of
data.
Departments' Response: The
Departments recognize that
disaggregation can produce certain cell
sizes that fall below the aggregation
levels that are allowed in order to
protect the data from yielding PII.
The Departments did not impose a
minimum disaggregation level in this
section of the NPRM or this Joint WIOA
Final Rule and will provide additional
clarity through guidance regarding
aggregation that is statistically
significant and reliable yet protects the
identity of individuals served through
the programs. In developing such
guidelines and guidance, the
Departments have considered industry
standards such as those established by
the National Institute of Standards and
Technology (NIST), the Family
Educational Rights and Privacy Act
FERPA), the confidentiality regulations
for the VR program at 34 CFR 361. 38,
the UC confidentiality regulations found
at 20 CFR part 603, the Social Security
Act sec. 1137( a)( 5) as well as State laws
that govern aggregation levels and
factors that can be used to affect the
level of suppression required to
maintain the privacy and confidentiality
of participant data. No change to the
regulatory text is being made in
response to these comments.
Furthermore, the Departments reiterate
their interpretation of this statutory
provision of WIOA, as noted in the
NPRM at 80 FR 20474, 20589 ( April. 16,
2015). As written, WIOA sec. 116( d)( 2)
requires the performance report to be
subject to WIOA sec. 116( d)(5)( C).
However, this section refers to Data
Validation, and the Departments
interpret this reference to requires States
to comply with sec. 116( d)( 6)( C), which
ensures the Departments receive
statistically reliable information and
protects participants' privacy. The
Departments are implementing this
regulation as proposed.
Paragraph (c) of § 677. 160 requires
that the State performance report
include a mechanism of electronic
access to the State' s local area and ETP
performance reports. This provision
does not require a State to submit the
actual local area and ETP performance
reports with its State report. Failure to
provide a mechanism of electronic
access to the State' s local area and ETP
performance reports will constitute an
incomplete State performance report
submission, and thus trigger sanctions.
No comments were received regarding
this electronic access reporting
requirement. This section remains
unchanged from that proposed in the
NPRM.
Paragraph (d) of §677.160 states that
States and local areas must comply with
the requirements in sec. 116 of WIOA as
explained through joint guidance that
the Departments will promulgate. This
section remains unchanged from that
proposed in the NPRM.
Section 677. 165 May a State establish
additional indicators of performance?
Section 677. 165 reflects the WIOA
provisions in sec. 116(b)( 2)( B) that a
State may identify in the Unified or
Combined State Plan additional
performance accountability indicators.
For example, a State could add an
indicator for attaining U.S. citizenship,
work readiness, completion of work -
based learning, or any other indicator of
State significance. This provision of
additional performance indicators
proposed by the State remains
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unchanged from WIA. There were no
comments on proposed § 677. 165. There
were no substantive changes made to
this section.
Section 677. 170 How are State levels
of performance for primary indicators
established?
Section 677. 170 outlines the process
that will be followed and the factors that
will be considered in determining
adjusted levels of performance. WIOA
uses the term " adjusted levels" to refer
to both the levels agreed to prior to the
start of a program year, as well as the
adjustment done using the objective
statistical model at the close of the
program year. In order to distinguish
between the two adjustment processes
described in statute, this section was
revised to use two different terms for
each process, specifically " negotiated
levels of performance" and " adjusted
levels of performance." Section 677. 170
was revised to provide specific
distinctions among expected levels,
negotiated levels, and adjusted levels of
performance. The section explains the
process under which levels of
performance are negotiated, adjusted,
and then calculated.
Section 677.170(a)( 1) implements the
requirement in sec. 116(b)( 3)( A)(iii) that
States provide expected levels of
performance in the initial submission of
the Unified or Combined State Plan for
the first 2 years of the plan. In addition,
the Departments are requiring in
677. 170( a)( 2) that the States submit
expected levels of performance for the
third and fourth years before the start of
the third program year covered by the
Unified or Combined State Plan
consistent with §§676. 135 and 676. 145,
as part of the State Plan modifications
under sec. 102( c)( 3)( A) of WIOA.
Comments: One commenter
questioned whether performance levels
required in the State Plans are the
proposed standards or the negotiated
standards since the term " expected" is
used. The commenter also
recommended that the State WDB
coordinate and participate in
performance negotiations for each
partner and that the negotiations be
completed with States at least 45 days
before the statutory deadlines for
submission of the 4 -year plans and the
2 -year plan modifications.
Departments' Response: Section
116(b)( 3)( A)(iii) of WIOA requires that
each State identify expected levels of
performance for each of the
corresponding primary indicators of
performance for each of the core
programs for the first 2 program years
covered by the Unified or Combined
State Plan. The expected levels of
performance are those submitted by the
State in the initial submission of the
State Plan prior to negotiation. The
expected levels of performance will be
used to reach agreement with the
Departments on State negotiated levels
of performance. Therefore, the expected
performance levels are similar to
proposed goals, reflecting the State' s
expectations for its performance. These
expected levels, however, will be
adjusted through negotiations between
the State and the Departments in
accordance with sec. 116(b)( 3)( A)(iv) of
WIOA. Once the negotiated levels of
performance are agreed upon, these
levels will be incorporated into the
approved Unified or Combined State
Plan. Section 677. 170( a) reflects this
statutory requirement. The Departments
did not modify the regulation to require
coordination across core programs with
regard to the negotiations process, as
recommended by the commenter. The
Departments agree that the commenter' s
suggestions are important for the
purposes and priorities of WIOA and
strongly encourage coordination across
the core programs and other partner
programs with respect to negotiating
performance levels for all programs
operating in a State. This section is
consistent with the statutory
requirements; the timing of the
negotiation is connected to the approval
of the State Plan. The Departments will
provide guidance about the negotiation
process.
Section 677.170(b) requires that the
State reach agreement with the
Secretaries on negotiated levels of
performance based on the factors in
WIOA sec. 116(b)( 3)( A)(v). The
Departments reiterate that WIOA uses
the term " adjusted levels" to refer to
both the levels agreed to prior to the
start of a program year, as well as the
adjustment done using the objective
statistical model at the close of the
program year. This paragraph was
revised to use the term " negotiated
levels" as appropriate, to distinguish
between the two processes.
The Departments sought comments on
whether any additional factors, beyond
those identified in the proposed
regulation, should be considered in
developing the statistical adjustment
model, and the best approach to
updating the model as necessary.
Comments: Several commenters
requested clarification of the
requirement for promoting continuous
improvement, as set forth in paragraph
b)( 3) of § 677. 170. One commenter
recommended that the Departments
consider embracing the full concept of
continuous improvement or eliminate
the term from the regulations because a
true continuous improvement measure
may have nothing to do with increasing
a performance measure and may seek to
improve a process. Another commented
that continuous improvement can be
defined in a variety of ways, including
as improvements in efficiency.
Commenters also requested that
continuous improvement be defined in
the regulation.
Departments' Response: The
Departments want to make clear that
sec. 116( b)( 3)( A)(v) of WIOA requires
the negotiated levels of performance
take into account four factors, including,
among other things, how the levels of
performance promote continuous
improvement. The Departments
recognize the complexities involved in
using a continuous improvement factor
in performance negotiations. However,
the Departments are unable to remove
the continuous improvement factor from
the regulation because it is a statutory
requirement. The Departments will
issue guidance on the performance
negotiations process that will provide
additional information regarding how
the factor will be applied. No change to
the regulatory text is being made in
response to these comments.
Section 677.170(c) provides that the
Secretaries will disseminate an objective
statistical adjustment model that will be
used both to reach agreement on the
State negotiated levels of performance
and to revise the negotiated levels at the
end of a program year, to establish the
adjusted levels of performance. The
objective statistical adjustment model
will account for actual economic
conditions and characteristics of
participants, including the factors
required by WIOA sec.
116(b)( 3)( A)(v)(II). The Departments will
consider identified statutory factors and
other factors, which through empirical
support are established to have an effect
on employment or skill outcomes and
are consistent with the factors identified
in WIOA. The Departments also will
publish guidance that includes how the
model was developed, what factors were
considered, and how the results are
interpreted.
The regulation reflects the statutory
requirement that the objective statistical
model consider certain factors. The
differences among States in actual
economic conditions, as set forth in
677. 170( c)( 1) for required inclusion in
the statistical adjustment model,
include the same economic conditions
identified in WIOA sec.
116(b)( 3)( A)(v)(II)(aa). The
characteristics of participants, as set
forth in § 677. 170( c)( 2) for required
inclusion in the statistical adjustment
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model, include the factors identified in
WIOA sec. 116(b)( 3)( A)(v)(II)(bb).
Comments: One commenter expressed
concern that including participants'
disability status as a factor in the
objective statistical model could
unintentionally undermine the goal of
increasing the number of participants
with disabilities in integrated and
competitive employment settings.
Departments' Response: The
Departments note that disability status
is a statutorily required factor for the
objective statistical model. The
Departments also note that continuous
improvement is a factor in establishing
the negotiated levels of performance.
Comments: In the preamble to the
NPRM, the Departments requested
comments specifically concerning
additional factors to consider in
developing the statistical adjustment
model. Many commenters supported the
commitment to use a statistical model
and offered additional factors, including
race, Hispanic ethnicity, age, gender,
veterans in the area, severity of
disability (e.g., receiving Social Security
disability benefits), seasonal
employment, self-employment,
minimum wage and other economic
data applicable to the local area, nature
of predominant employers in the area,
quality of educational and training
facilities in the area, crime rate in the
area, public transportation and
geographic barriers in the area,
unemployment rate applicable to young
people, lack of a high school diploma,
individuals not in the workforce, and
ratio of earnings at program entry to
child support arrearages.
Departments' Response: Upon
consideration of comments regarding
additional factors to be included in the
model, the Departments concluded
additional regulation is not required to
include additional factors. The
Departments intend, in accordance with
the statutory requirements for the use of
an objective statistical model, to
consider those identified statutory
factors along with any other factors
either established within WIOA or
through empirical support (and which
are consistent with the factors in the
statute) to have an effect on employment
or skill outcomes as measured by the
primary indicators of performance
established in § 677. 155. Factors that are
included in the model will be based on
the application of empirically supported
statistical analyses used to determine
the effect of a particular factor on
participant outcomes. The statistical
adjustment model will be reviewed
periodically and may be revised with
appropriate consultation to ensure its
accuracy and utility.
Comments: A commenter asserted
that adjusted performance levels should
include a factor for small States, single -
area States, and areas of generally lower
population.
Departments' Response: The
Departments are considering all
potential factors in an effort to establish
a model that is evidence -based and
supported by the literature. Having
conducted a review of the existing
literature, the Departments have
concluded that small States and single -
area State structures would be
accounted for by those variables that
capture industrial structures,
unemployment rates, and shares of the
population represented by race and
educational levels. No change to the
regulatory text is being made in
response to these comments.
Comments: One commenter suggested
that the Departments be mindful of the
potential burden that requiring
additional data collection would create
and urged reducing reporting burdens
and simplifying reporting requirements.
Departments' Response: The
Departments are mindful of the
reporting burden that would result from
requiring additional information on
participants. In this case, the
Departments aim to work with States as
well as other agencies that may have
administrative data that could be used
to populate the model based on
established, empirical evidence that
such information is shown to have an
effect on the outcomes being measured.
Comments: A few of the commenters
suggested that the Secretaries may need
to establish separate statistical models
for different programs, such as those for
youth and for adults, and suggested that
the models should be tested over a trial
period and re-examined. Commenters
also recommended regular updates to
the models.
Departments' Response: Section
116(b)( 3)( A)(v)(II) of WIOA requires that
adjustments be made using " the
objective statistical model," which the
Departments will build on a common
framework for all core programs to
allow for programmatic differences
between programs. The model will be
examined and revised as necessary. No
change to the regulatory text is being
made in response to these comments.
Comments: One commenter raised
concerns about the title II program not
collecting individual records at the
Federal level and stated that such
records are absolutely necessary to
develop and operate statistical models.
The commenter urged the Departments
to develop a common reporting
mechanism. Other commenters noted
that title II programs lack experience
using adjustment models and requested
additional guidance and technical
assistance.
Departments' Response: The
Departments acknowledge that the use
of aggregate data for the title II AEFLA
program creates shortcomings for
developing an adjustment model
because, among other things, the results
only can be used to adjust performance
at the aggregate level (i.e., State) and
results from these models cannot be
applied to any sub -level (e.g., city,
county). However, the Departments
disagree that individual data are
absolutely necessary to develop a
statistical adjustment model for State -
level adjustments. Aggregate data may
be used in statistical adjustment models
when individual records are not
available. The Departments have already
developed statistical models for other
program purposes that produce accurate
results using aggregated data and show
that results are comparable for State
level adjustments, regardless of whether
individual data (i.e., disaggregated data)
or aggregate data are used. The
Departments note that for the AEFLA
program under title II, ED will provide
technical assistance to States in
applying the statistical adjustment
model. The Departments will develop
procedures to minimize burden to States
when using the model to generate
adjusted levels of performance. No
change to the regulatory text is being
made in response to these comments.
Comments: A few commenters
warned that there is limited or no
statistical tribal data available that
captures economic circumstances for
the various Indian and Native American
geographic service areas. One of these
commenters added that a regression
model that factors in local economic
conditions will need to be developed for
the INA program.
Departments' Response: In response
to the commenter' s concern about
developing an accurate regression
model to establish levels of performance
for INA program grantees, the
Departments recognize that labor market
information (LMI) for American Indian
geographic service areas may not be as
reliable as that for other areas. However,
the regression model also factors in the
characteristics of participants served by
the grantee and is, therefore, not totally
dependent on LMI. Despite the potential
for inaccurate LMI data for American
Indian geographic service areas, the
Departments are confident a regression
model can be developed that establishes
fair and attainable levels of performance
for each INA program grantee' s service
area. The Departments envision
developing further guidance regarding
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INA adult performance indicators. No
change to the regulatory text is being
made in response to these comments.
Comments: Some commenters did not
support the use of an adjustment model,
or express concerns about the design of
the State performance accountability
systems, because of the temptation to
serve those individuals who are more
likely to achieve positive outcomes.
This commenter also noted that the fact
that the State has sufficient tools to
evaluate current and projected
performance to identify intervening
occurrences that would trigger re-
evaluation of performance.
Departments' Response: While the
Departments understand the concerns
expressed, sec. 116(b)( 3)( A)(v)(II) of
WIOA requires the use of an objective
statistical model to adjust the State
levels of performance based on actual
economic conditions and characteristics
of participants. The Departments
caution that any service provider
tempted to utilize the tactics described
by the commenter should consider the
impact on future performance levels,
which may be affected because of
relatively lower numbers or percentages
of hard -to -serve populations and other
populations with barriers to
employment. No change to the
regulatory text is being made in
response to this comment.
Comments: Commenters added that
the model will need to account for
varying levels of impact of a particular
demographic or local economic
condition in different parts of the
country, in particular race and ethnicity,
offender status, dependence on public
assistance, local minimum wage, and
the local unemployment rates for young
adults. Some commenters recommended
these factors be explicitly mentioned in
the regulation. One such commenter
suggested that select CEOs participate in
the selection of factors in different parts
of the country.
Departments' Response: The
Departments are considering a State
fixed effect variable. Such a variable
would account, in essence, for the
quality of the programs and their
services. The Departments, after
consulting with various stakeholders
and particularly in consultation with
expert reviewers, identified that the
most important piece of information
that is not directly included within the
statistical adjustment model for the
purposes of the performance
accountability system, is the quality of
the programs and services. The model is
being developed with consideration of
all participant and student variables
required by WIOA and the potential
State specific factors that could be
accounted for through a State fixed
effect variable. This variable ultimately
could serve the same purpose
statistically as including additional
individual characteristics and any other
State characteristic not included in the
model. With regard to participation of
select CEOs in the selection of factors to
be included within the statistical
adjustment model, the Departments note
that the methodology, including the
factors in the model, will be available
for public comment and review.
Moreover, WIOA sec. 116( b)( 3)( A)(viii)
requires the Departments to develop an
objective statistical model in
consultation with a variety of
stakeholders identified in sec.
116(b)( 4)( B), who would include CEOs.
No change to the regulatory text is being
made in response to these comments.
Comments: Some commenters also
suggested that States should be allowed
to provide additional information
specific to the State that may not be
fully accounted for in the national
statistical models when setting
performance targets. Some commenters
suggested that State and local areas
should be able to document this
information and use it in performance
negotiations. Others stated that
additional State information is critical
because it is not feasible to develop a
single statistical model with one set of
demographic and economic variables
that is equally accurate for all States and
all boards.
Departments' Response: The
Departments note that States are
permitted to provide additional
information concerning factors listed in
sec. 116(b)( 3)( A)(v) of WIOA during the
negotiations process. The States may
provide relevant documentation and
research concerning these factors during
the negotiation process. The
Departments will ensure that each
programs' data, its availability, and its
specificity will be considered in
developing the methodology and
framework for the application of the
model to each program. The
Departments intend to continue to
assess the quality and robustness of the
statistical adjustment model since it
plays such a key part in the adjusted
levels of performance under this
section. No change to the regulatory text
is being made in response to these
comments.
Section 677.170(d) requires the
statistical adjustment model to be used
before the beginning of a program year
as a consideration in establishing levels
of performance, and then used to adjust
levels of performance at the end of a
program year. The Departments reiterate
that WIOA uses the term " adjusted
levels" to refer to both the levels agreed
to prior to the start of a program year,
as well as the adjustment done using the
objective statistical model at the close of
the program year. This paragraph was
revised to use the term " negotiated
levels" as appropriate to the process.
Comments: Several commenters
opposed having the goals adjusted twice
a year, because it would make building
strategic plans difficult, add additional
burden, and create a moving target.
Another commenter requested that the
margin of error be published with the
statistical models. A few commenters
asserted that applying the formula at the
end of the year creates the possibility of
targets higher than planned outcomes,
which could lead to local areas failing
performance. The commenters stated
that this approach does not lend itself
to a strategic planning process. An
individual suggested that the year-end
adjustment process needs to allow room
for additional factors that were not
anticipated to be significant at the start
of the year, and another commenter
asked whether States will be able or
required to negotiate the final targets or
if the results of the model will be
applied without discussion.
Departments' Response: Section
677. 170( d) implements sec.
116(b)( 3)( A)(iv) and (vii) of WIOA and
requires the objective statistical model
to be applied before the beginning of the
program year as a consideration in
establishing State levels of performance
for the upcoming program year and be
used again at the end of the program
year based on actual circumstances.
Therefore, there is no statutory authority
to delete the requirement to use the
objective statistical model at the end of
the program year. The concern about
margin of error is important in
evaluating the results from the model.
Consequently, the Departments will
provide confidence intervals along with
the adjusted performance measures for
each State. The Departments also
recognize that the effects of variables
used in the adjustment model may
change over time. No change to the
regulatory text is being made in
response to these comments.
Comments: Commenters requested
that the model be made available for the
States to install within their own
information systems so that it can be
made available to the local areas.
Departments' Response: The
Departments acknowledge the
commenters' interest in incorporating
the model within their own systems. As
required by WIOA, the Departments
intend to make the statistical adjustment
model available to States, local areas,
and the public. No change to the
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regulatory text is being made in
response to these comments.
Comments: Commenters sought
guidance and technical assistance,
including guidance on how to ensure
that disadvantaged populations receive
comparable services throughout the
program with expectations that they
will achieve outcomes leading to
successful exits similar to all
participants in the program. A
commenter favored development of a
common reporting mechanism, so that
model development would not be
delayed by claims that the necessary
data are not available.
Departments' Response: The
Departments intend to publish guidance
that includes how the model was
developed, what factors were
considered, and how the results are
interpreted. The Departments also share
the commenters' concerns regarding
comparable service for disadvantaged
participants and commit to providing
technical assistance and guidance on
how to ensure an equal distribution of
services. No change to the regulatory
text is being made in response to these
comments.
Comments: Many commenters
suggested that, because data are lacking
to set benchmarks for the new outcome
measures, FY2017 should be a
benchmarking year, or implementation
should be lagged for 2 to 4 years to
establish accurate levels of performance.
A commenter expressed concern about
the comparability of data across core
programs and across States. Another
commenter asked for clarification on
whether there will be sanctions for low
performance prior to the establishment
of benchmarks and baselines.
Departments' Response: The
Departments have revised § 677. 190( c)
in response to these comments; more
information about the Departments'
approach is set out below in the
preamble to that section.
Section 677.170(e). The Departments
added a new paragraph (e) to § 677. 170,
and renumbered the previous paragraph
e) as § 677.170(f).The new paragraph
e) specifies that the previously
discussed negotiated levels, after being
revised at the end of the program year
based on the statistical adjustment
model, are the adjusted levels of
performance.
Section 677. 170(f)requires States to
comply with the requirements in sec.
116 of WIOA. The Departments intend
to issue guidance, which may include
information on reportable individuals as
established by the Secretaries. No
comments were received regarding this
reporting requirement and no changes
have been made to this section.
Section 677. 175 What responsibility
do States have to use quarterly wage
record information for performance
accountability?
Section 677. 175 implements the
requirement that States must, consistent
with State laws, use quarterly wage
record information to measure progress
on State and local performance
accountability measures, as required by
sec. 116( i)( 2) of WIOA. Such
information includes the intrastate and
interstate wages paid to an individual,
the individual' s SSN, and information
about the employer paying the wages to
the individual.
After further review of this provision,
the Departments recognize that some
participants may not be included in
quarterly wage records held by the
State, such as those participants who
refuse to provide a SSN to the program
or who may be self-employed. In light
of this fact, the Departments have
revised § 677. 175( a) to make clear that
States must use quarterly wage records
to the extent they are available;
however, States may use other
information when such records are not
available. In so doing, the Departments
ensure that programs may track the
participants for performance
accountability purposes even if their
information is not contained in the
State' s quarterly wage record system.
The Departments have revised
677. 175( c) to provide that the State
agency or appropriate State entity
designated to assist in carrying out the
performance requirements is
responsible for preventing
disaggregation that would violate
applicable privacy standards. The
Departments added the words
applicable" and " standards" to
677. 175( c)( 3) to require that the States
must consider the privacy standards
that apply to them.
Comments: A significant number of
commenters raised concerns about the
difficulty in matching wage records,
citing concerns over FERPA privacy
rules, that students often refuse to
provide SSNs ( for reasons such as
concern about consumer fraud and
uncertain residency status), some
students do not have SSNs, and several
States do not allow programs to collect
SSNs. Some of these commenters
asserted that there are other data
matching mechanisms by which to track
employee outcomes. Other commenters
suggested not including participants
without SSNs in the measure for
computing the percentage for the
performance target. Many commenters
also urged the Departments to provide
guidance on how to collect
employment-related data without use of
SSNs, acceptable forms of SSN
validation, and on alternatives to using
wage records. Many commenters added
that data from the UI wage record
system often do not present a complete
picture of employment because it
excludes the self-employed, those
outside of an individual State, and risks
over -representing Limited English
Proficient individuals in the non-
matching group. Some of these
commenters recommended that States
be given supplemental options such as
follow-up calls or emails to verify
employment status.
Departments' Response: The
Departments considered the
commenters' concerns about the
obstacles to using wage record
information and agree there are limited
circumstances in which such
information may not be available. The
Departments want to make clear that
sec. 116( i)( 2) of WIOA requires that
States use quarterly wage records when
determining performance under the
primary performance indicators that
measure employment status and median
earnings. Using its authority under sec.
189 of WIOA, the Secretaries are
allowing States to use other information
to verify performance of those
individuals for whom quarterly wage
records are not available, such as those
who are self-employed. This flexibility
is necessary to carry out the
requirements of WIOA and its
performance accountability system. To
do otherwise would potentially result in
programs not able to report on
participants as required under WIOA.
Therefore, where available and possible,
States must use wage records to fulfill
reporting requirements. Furthermore,
the Departments understand that wage
record information may not provide a
complete representation of the
employment outcomes. For all the
reasons discussed here, the Departments
will allow the collection and
verification of supplemental wage
information to demonstrate employment
outcomes in the second and fourth
quarters after exit in those instances
where wage records are not available.
However, if a State uses supplemental
information to report on the
employment rate indicators, the State
also must use supplemental information
to report on the median earnings
indicators. The Departments will
provide guidance on acceptable
supplemental information to verify
performance outcomes. Section
677. 175( a) has been revised to reflect
the changes described here.
With regard to acceptable forms of
SSN validation, the Departments note
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that WIOA sec. 116(d)( 5) requires the
Departments to issue data validation
guidelines, which the States must use to
ensure that the information in the
reports is valid and reliable. See the
preamble to § 677. 240 below for further
discussion on this requirement.
In the NPRM, the Departments
expressed the intent to engage in a
renegotiation of the WRIS data sharing
agreements with States, which will
allow States to conduct interstate wage
matches for all WIOA core programs.
Like WIA, WIOA similarly provides
authority for the Departments to
facilitate data matching between the
States.
Comments: Several commenters
approved of this commitment and
encouraged the Departments to clarify
that all the core programs may use the
Federal Employment Data Exchange
System (FEDES) for WIOA performance
reporting.
Departments' Response: Under WIA,
DOL' s Employment and Training
Administration aided in the
establishment and management of a
system through which participating,
signed States could access Federal
employment records from the
participating government agencies. The
Departments have concluded that the
authorities established in WIOA allow
for the continuation of such an
agreement to facilitate wage matching
for Federal employment for States that
become signatories to the established
data sharing agreement. The
Departments have concluded that such
agreements should be entered into and
conducted at the State level based on
the language of WIOA sec. 116(i)(2),
which requires that the use of wage
records must be consistent with State
law. Moreover, WIOA sec. 116(i)(2)
requires the Secretary of Labor to
facilitate such arrangements between
States. Therefore, the Departments
continue in their commitment to review
and renegotiate the appropriate
agreements with State government
entities that provide the necessary wage
data for complete and robust
performance reporting across all core
programs under WIOA.
Comments: One commenter
recommended that, for private training
providers who cannot access wage
record information, regulations should
provide that the data these entities
submitted for training participants not
found in the UI wage records be
returned to the provider, indicating that
the records do not match UI records.
Departments' Response: ETP access to
wage records is governed by the UC
Confidentiality and Disclosure
regulations at 20 CFR part 603.
Therefore, training providers seeking
access to wage records must comply
with these provisions. Because ETP
access is governed by 20 CFR part 603,
the Departments have not changed
677. 175 in response to this comment.
However, the Departments will issue
guidance regarding the process of
matching wage records. No change to
the regulatory text is being made in
response to this comment.
Comments: Another commenter
favored allowing performance to
be reported disaggregated by
industry.
Departments' Response: The
Departments consider additional
disaggregation, when it is not required
by statute, to pose an additional and
unnecessary burden on the States.
Moreover, many States do not require
the inclusion of the North American
Industry Classification System codes
within wage records. Therefore, its
inconsistent availability makes
requiring this kind of reporting
infeasible. No change to the regulatory
text is being made in response to this
comment.
Comments: One commenter suggested
that WDBs and AEFLA providers are
entitled to know whether a participant
they served was employed in a given
quarter.
Departments' Response: The
Departments reiterate that an entity' s
ability to obtain this information
depends on their compliance with the
confidentiality requirements of 20 CFR
part 603 ( covering UC records), 34 CFR
part 99 ( covering educational records
protected by FERPA), and 34 CFR
361. 38 ( covering VR records), as well as
any applicable State laws. However, the
Departments want to make clear that
States are responsible for ensuring the
appropriate entities have access to the
information required for reporting
purposes under WIOA sec. 116 and
these regulations.
Comments: The Departments received
several comments related to the use of
wage record information and the VR
program. Another commenter asked
whether the wage record provision
will be tracked in the VR program
differently than in the other core
programs. A commenter requested that
additional guidance on VR access to
WRIS be issued so that States may plan
any necessary changes to their IT
systems.
Departments' Response: The
Departments recognize the unique
disclosure requirements that have to be
navigated by various entities. Because of
the importance of protecting PII while
also obtaining the necessary information
needed for States to comply with the
performance accountability system
requirements, the Departments will
issue guidance to assist States in regard
to accessing wage record information.
The Departments also refer these
commenters to the UC Confidentiality
and Disclosure regulations at 20 CFR
part 603, which govern the
confidentiality and disclosure of, wage
record information. It should be noted
that the confidentiality provisions apply
to PII contained within a wage record
and this extends to the absence of data
for an individual level as well. The
tracking of employment outcomes
through wage record matching is subject
to 20 CFR part 603 and any applicable
Federal and State laws; therefore, there
may be some variation in the
mechanisms for matching wage record
data via the State UC agencies and the
process through which any core
program enters into and engages under
those agreements. Furthermore,
regulating access to wage record
information is beyond the scope of this
part. No change to the regulatory text is
being made in response to these
comments.
Comments: A commenter asserted
that if the VR program is to track
progress on wages, then it would need
ready access to longer -range
employment data.
Departments' Response: The VR
program is subject to the same outcome
reporting requirements as the other core
programs under WIOA. Thus the
Departments have concluded that access
to a different duration of employment
data is not necessary. No change to the
regulatory text is being made in
response to this comment.
Comments: Another commenter
requested clarification on how
participants who are seeking to better
themselves without entering the
workforce or postsecondary education
should be treated in the performance
accountability system. This population
includes retirees, the non -working
disabled, and English language learners
who are seeking to improve their
language skills but are not in the labor
force.
Departments' Response: The
Departments interpret WIOA sec.
116(b)( 2)( A)(i) to require all participants
to be included in the primary
performance indicators, with very
limited exceptions, regardless of their
employment status at program entry.
No change to the regulatory text is
being made in response to this
comment.
Comments: A commenter requested
clarification about whether the wage
record information refers to wages paid
or wages earned.
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Departments' Response: The
Departments clarify that the wage record
information held by State UC agencies,
from which wage record information is
drawn, only contain the wages paid to
an individual. See 20 CFR 603. 2( k)( 1).
Moreover, sec. 1137( a)( 3) of the Social
Security Act, which creates the
requirement that States provide
quarterly wage reports, only requires
that employers report wage information.
Similarly, sec. 3306(b) of the Federal
Unemployment Tax Act defines wages
as all remuneration for employment.
Because the records only include wages
paid, the Departments interpret WIOA
sec. 116( i)( 2)' s requirement to use State
UI wage records to mean that the States
only are required to report on wages
paid. No change to the regulatory text is
being made in response to this
comment.
Comments: Some commenters favored
data sharing and record matching across
departments and programs. Another
commenter said that the Indian and
Native American programs (INAP) do
not have a mechanism to match
participant SSNs with UI wage records.
One commenter recommended that the
Departments, in renegotiating the Wage
Record Interchange System (WRIS)
agreements, make it possible for States
to access readily both intra-and
interstate UI data beyond the fourth
quarter after exit for longer-term
program impact evaluations.
Departments' Response: The
Departments recognize the variety of
structures that exist for programs under
WIOA; some programs are run through
the States and others are run through
sub -State level grantees. The
Departments recognize the challenges
faced by the INA programs in complying
with WIOA performance reporting
requirements and will be issuing
guidance for and providing technical
assistance to those programs. Under
WIA the Secretary of Labor, working
with States, established the WRIS to
facilitate access to interstate wage data
for State workforce agencies to fulfill
their performance reporting
requirements. In addition, DOL
established the Common Reporting
Information System (CRIS) in order to
provide access to the aggregate wage
data necessary for performance
reporting, to those workforce programs
that were not operated by State
workforce agencies. These programs
included the WIA national programs,
such as INAP and NFJP, as well as
competitive and discretionary grant
programs operated under the
jurisdiction of DOL.
Under WIOA, the WRIS, WRIS2, and
CRIS are being reviewed and
renegotiated to establish the
mechanisms for programs, including
those under the jurisdiction of ED,
where applicable, to access the quarterly
wage data necessary for grantees to
fulfill their WIOA performance
reporting requirements.
The Departments considered these
comments and made no changes to the
regulatory text. First, WIOA sec.
116( i)( 2) already requires that the wage
records of any State receiving program
funds are available to any other State to
the extent that such wage records are
required by the other State in carrying
out performance accountability for its
State Plan. While the Departments are
working to facilitate applicable
programs' access to intra-and interstate
UI data, the Departments have
determined that the conditions and
availability of the records outlined
within these agreements are not
appropriately included in this
regulation.
Comments: A commenter suggested
that DOL look at wage record pilots to
research gaps in wage record use.
Departments' Response: The
Departments will continue to give
consideration to activities that identify
gaps and improve on the usage of wage
record information for the purposes of
performance reporting. No change to the
regulatory text is being made in
response to this comment.
Comments: Several commenters
suggested that Local WDBs have access
to data that is timely and pertinent,
citing surveys in which participants say
that their job is unrelated to the training
received.
Departments' Response: The
Departments recognize the need for
local areas to gain access to timely and
accurate data and the Departments
strongly urge States to provide the sub -
State level local area reporting outcomes
to their local areas along with the
reporting that they submit to the
Departments. No change to the
regulatory has been made in response to
these comments.
Comments: Commenters suggested
that the wages should include all
program participant wages, pre-and
post -exit.
Departments' Response: The
Departments have concluded that it is
not necessary to include this level of
specificity in the regulatory text. Such
information and its required collection
are handled through the WIOA Joint
Performance ICR. No change to the
regulatory text is being made in
response to these comments.
4. Sanctions for State Performance and
the Provision of Technical Assistance
20 CFR part 677, subpart B; 34 CFR
361. 180 through 361. 200; 34 CFR
463. 180 through 463. 200)
Section 677. 180 When is a State
subject to a financial sanction under the
Workforce Innovation and Opportunity
Act?
Section 677. 180 outlines performance
and reporting requirements that are
subject to sanctions under sec. 116(f) of
WIOA. Section 677. 180 provides that
the failure to submit the State annual
performance report required under sec.
116( d)( 2) of WIOA is sanctionable, and
that sanctions for performance failure
are based on the primary indicators of
performance. The Departments have
revised § 677. 180 to correct a statutory
citation error in the introductory
paragraph (to change WIOA sec. 116(d)
to sec. 116(f)).WIOA sec. 116(d)
outlines the requirements for
performance reports. The correct
reference should be to sec. 116(f), which
governs sanctions for State failure to
meet State performance accountability
indicators. No other substantive changes
were made to this section.
Comments: Commenters expressed
support for the imposition of sanctions
for failure to report as well as for failure
to meet a performance standard.
A few commenters stated that funding
and sanctions should he tied to
individual programs to ensure that a
core program' s poor performance does
not negatively impact the funding of
other core programs.
Departments' Response: The
Departments recognize the commenters'
concerns regarding funding and
sanctions being tied to individual
programs; however, WIOA sec.
116( f)(1)( B) makes clear that the
sanctions are imposed against the
Governor' s Reserve for statewide
activities under the title I adult,
dislocated worker, and youth formula
programs regardless of which of the six
core program' s performance constitutes
a failure giving rise to the sanction.
Therefore, given the explicit statutory
requirement, the Departments do not
have the authority to do as these
commenters suggested. No change to the
regulatory text was made in response to
these comments.
Comments: Another commenter
requested clarification regarding how
individual core programs will be held
accountable if they reside in different
agencies.
Departments' Response: The
Departments note that accountability for
the State' s performance rests with the
Governor and State WDB, through
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which all core programs are
represented. Therefore, even if the core
programs are located in different
agencies, there is no difference in how
the States and core programs are treated.
The Departments encourage and expect
the core programs to work closely
together regardless of the State agency
in which they are located. No change to
the regulatory text was made in
response to this comment.
Comments: A commenter sought
clarification concerning the process for
submitting the State annual
performance report and the manner in
which sanctions will be enforced.
Departments' Response: The
Departments consider the process of
submitting State annual performance
reports to fall under the purview of sub -
regulatory guidance as it is
implementation of the regulatory
requirements. Therefore, the
Departments will issue guidance clearly
explaining how to carry out the annual
reporting process. The Departments will
impose financial sanctions consistent
with WIOA sec. 116( f)(1)( B), which
provides for a five percent reduction of
the State Governor' s Reserve for
Statewide Activities from the amount
allocated in the immediately succeeding
program year. The Departments
consider the logistics of how the
financial sanction will work to fall
under the purview of sub -regulatory
guidance as it is implementation of the
statutory and regulatory requirement.
Moreover, the financial sanctions will
be carried out consistent with financial
management and rules already in place.
Therefore, the Departments will issue
further guidance on how this process
will be conducted. No change to the
regulatory text is being made in
response to this comment.
Comments: One commenter requested
clarification about whether WIOA or
Perkins indicators of performance
would take precedence in a Combined
State Plan.
Departments' Response: The
Departments clarify here that the
Perkins program is subject to its
authorizing statute' s requirements on
performance measurement. Should a
grantee receive both Perkins and WIOA
funds, it must report on both programs
accordingly.
Section 677. 185 When are sanctions
applied for a State' s failure to submit an
annual performance report?
Section 677. 185 outlines the
circumstances under which a State may
be sanctioned for failure to report under
sec. 116(f)(1)( B) of WIOA. No
substantive changes were made to this
section.
Comments: A commenter stated that
the 30 -day deadline to request an
extension should be removed as it does
not allow for exceptional circumstances,
such as a natural disaster, that may
occur closer to the deadline.
Departments' Response: The
Departments refer the commenter to
677. 185( c)( 2) which allows for
unexpected events within the 30 -day
period and provides a process by which
exceptional circumstances may be
addressed in less than 30 days. No
change to the regulatory text was made
in response to this comment.
Comments: A few commenters
supported the enforcement of sanctions
for failure to report.
A few other commenters requested
clarification regarding what the
Departments consider exceptional
circumstances under which a State
would be exempt from sanctions for
failure to report.
Departments' Response: In response
to the comments on enforcement of
sanctions for failure to report, the
Departments note that a State annual
performance report is considered
complete only when it provides a
mechanism of electronic access to local
area and ETP performance reports.
Thus, the submission of a State annual
performance report that does not
provide a mechanism of electronic
access to local area and ETP
performance reports is a sanctionable
offense. Section 677. 185( b) provides a
non -exhaustive list of examples that
may qualify as an exceptional
circumstance. The listed exceptional
circumstances include natural disasters,
unexpected personnel transitions, and
unexpected technology related impacts.
These are not the only circumstances
that may be justified, but rather are
examples of the types of circumstances
the Departments would consider
exceptional. The Departments expect
that any request for delay or any failure
to report timely information would not
be based on a routine or predictable
situation. The Departments interpret
677. 185( c) to require these exceptional
circumstances to be fully documented
by the States, supported by clear
rationale, and include an estimation of
when the performance reports will be
made available. The Departments will
determine the merits of each request
based on exceptional circumstances in
consultations with the States, and their
respective regional offices. The
Departments plan to issue guidance to
provide further clarity with regard to
exceptional circumstances. No change
to the regulatory text is being made in
response to these comments.
Comments: A commenter expressed
concern that the guidance regarding
exceptional circumstances is to be
issued without public comment and at
a point at which States may already
incur sanctions.
Departments' Response: Any
guidance issued by the Departments
regarding exceptional circumstances
would be interpretive and thus, is
exempt from the notice and comment
rulemaking requirements under the
Administrative Procedure Act. See 5
U.S.C. 553(b)(A). The Departments
intend to issue guidance prior to
applying sanctions. No change to the
regulatory text has been made in
response to this comment.
Comments: A commenter requested
the Departments focus on incentivizing
timely submission of State annual
performance reports rather than
sanctions.
Departments' Response: WIOA sec.
116( f) requires that financial sanctions
apply with regard to the timely
submission of performance reports and
does not provide for incentives within
this context. No change to the regulatory
text was made in response to this
comment.
Section 677. 190 When are sanctions
applied for failure to achieve adjusted
levels of performance?
Section 677. 190 governs how States
will be assessed for performance failure
and when such failure will result in a
financial sanction. Although the
Departments have referenced other non-
core programs in previous sections of
this preamble for part 677, consistent
with WIOA sec. 116(b)( 2) and
116( f)(1)( B), performance success or
failure will be based solely on the
performance of the six core programs of
WIOA—not other partner programs in
the public workforce development
system. The Departments have added
two new provisions to § 677. 190( c) to
reflect a phased -in approach for
applying sanctions for failure to achieve
adjusted levels of performance. In
addition, the Departments reiterate that
WIOA uses the term " adjusted levels" to
refer to both the levels agreed to prior
to the start of a program year, as well as
the adjustment done using the objective
statistical model at the close of the
program year. Paragraph (c) was revised
to make clear that performance
accountability will be based on a
comparison of the State' s performance
with that determined to be the " adjusted
levels of performance," as appropriate.
These revisions resulted in renumbering
the subsequent paragraphs. Section
677. 190( c)( 2) provides that, until at least
2 years of complete data are available
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for each of the indicators, the
Departments will assess the State' s
performance on the overall program
score based on the indicators for which
there are at least 2 years of data
available. Section 677. 190( c)( 4)
similarly provides that until at least 2
years of complete data are available for
each of the indicators, the Departments
will assess the States' performance on
the overall indicator score, based on the
indicators for which there are at least 2
years of data available. The Departments
consider complete data to consist of, at
a minimum, 2 full program years of
performance data.
Comments: Many commenters
discussed the timeline for implementing
the full accountability system, with the
majority of commenters supporting a 2 -
year benchmarking period to allow for
the collection of baseline data to be used
to assess performance moving forward.
Other suggestions included a 1 -year
baseline period, a 3 -year baseline
period, and a 4 -year baseline period.
Still, other commenters supported a
baseline period, but did not provide a
specific timeline for implementing the
full performance accountability system.
Commenters supported using the PY
2016, PY 2017, and PY 2018 annual
report as the first years to report on
State adjusted levels of performance. A
commenter suggested the PY 2016
annual report be the first used for all of
the performance indicators except
credential attainment and measurable
skill gains. Some commenters asserted
that a 2 -year delay in the
implementation of sanctions would
allow for further calibration of the
statistical adjustment model. Some
commenters requested a 2 -year
transition period that would allow
States to adapt to the new performance
standards before sanctions are
implemented.
Departments' Response: Section
677. 190( c)( 1) and ( 3) govern how
performance on the overall State
indicator score and the overall State
program score will be assessed. As
explained above, the Departments have
revised the regulatory text in
677. 190( c) to reflect a phased -in
approach for applying sanctions for
failure to achieve adjusted levels of
performance. Paragraphs (c)( 2) and (4)
of § 677. 190 govern how performance on
the overall State indicator score and the
overall State program score will be
assessed. Section 677. 190( c)( 2) provides
that, until at least 2 years of complete
data are available for each of the
indicators, the Departments will assess
the State' s performance on the overall
program score based on the indicators
for which there are at least 2 years of
data available. Section 677. 190( c)( 4)
similarly provides that until at least 2
years of complete data are available for
each of the indicators, the Departments
will assess the States' performance on
the overall indicator score, based on the
indicators for which there are at least 2
years of data available. Pursuant to these
provisions, the Departments consider
complete data to consist of, at a
minimum, 2 full program years of
performance data.
The Departments acknowledge that,
given the lag in reporting data and the
amount of time needed for each
indicator to be measured, 2 program
years' worth of data for each of the
indicators will occur at different times.
However, the Departments consider it
vital that performance accountability
take effect as soon as possible to align
with the vision and requirements of
WIOA. These revisions provide for an
assessment of the overall State program
and indicator score when the States
have reported at least 2 years of
complete data for the indicators. For
performance accountability
determinations, including the
determination of failure to achieve
adjusted levels of performance, the
Departments will not use data reported
prior to July 1, 2016. The Departments
note that where historical data that were
reported under WIA provide a proxy for
the new indicators (at least 2 years of
data), it is possible to establish a
statistical adjustment model for
negotiation of those indicators. Such
indicators will be included in the
overall State program or overall State
indicator score for performance
assessment when States have reported 2
years of outcomes under WIOA. The
States are still subject to a performance
risk plan under § 677.200(b).
Comments: Several commenters urged
the Departments to delay
implementation of the full performance
accountability system for reasons other
than the collection of baseline data,
including that the first annual State
report should be coordinated with the
development of data systems.
Departments' Response: The
Departments recognize the challenges in
unified reporting across the core
programs. For this reason the
Departments are exercising the
transition authority in sec. 503 of WIOA
to implement the requirements in a
manner that allows for an orderly
transition from the requirements of WIA
to the requirements of WIOA. To the
extent that data are available, States
must comply by submitting the requisite
data. Moreover, the Departments
recognize that some States have the
capability to currently report all of the
data in one system and upload reports
to the Departments, whereas other
States may not have that capability. The
Departments plan to provide guidance
on the submission process for WIOA
State annual reports through the WIOA
Joint Performance ICR.
Comments: Several commenters
stated that sanctions should not he
implemented until the third consecutive
year of performance failure, rather than
the second, in order to allow
improvement measures to be effective.
Departments' Response: Section
116( f)(1)( B) of WIOA provides that
performance is assessed and sanctions
are applied in the second consecutive
year of failure. Therefore, the
Departments cannot implement the
commenters' suggestion.
Comments: Several commenters
remarked that a definition of second
year failure should be added to the
regulatory text in order to prevent a
State from incurring sanctions without
adequate time to improve performance.
Another commenter stated that
sanctions should not be applied until a
State has demonstrated that it is able to
implement their performance
improvement plan. While
acknowledging the existing statutory
constraints, a commenter expressed
concern about the lack of time to
intervene and allow program
adjustments to demonstrate
improvement.
Departments' Response: Section
116( f)(1)( B) of WIOA is clear that
sanctions apply after 2 program years of
consecutive performance failure; the
statutory language does not permit the
Departments to delay sanctions because
the State has not been able to implement
its performance improvement plan. The
Departments encourage States to use
their quarterly data to monitor progress
on their performance improvement plan
benchmarks without waiting until they
submit their annual performance report.
No change to the regulatory text was
made in response to these comments.
Comments: Concerning the timing of
performance outcome reporting, several
commenters stated that performance
outcomes for core programs should be
reported by December 31 of each year.
Departments' Response: The
Departments have concluded that the
timing of reporting performance
outcomes will be announced through
joint guidance clarifying when and how
States should provide their respective
program performance reports. No
change to the regulatory text was made
in response to these comments.
Comments: A commenter asserted
that to evaluate performance effectively,
55862 Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
indicators should be reported on a
quarterly basis.
Departments' Response: The
Departments note that § 677. 235
requires quarterly reporting for the
WIOA title I, Wagner-Peyser Act
Employment Service, and VR programs.
No change to the regulatory text was
made in response to these comments.
Comments: Commenters also
addressed the limited availability of and
timely access to data, which can
significantly hinder a State' s ability to
identify areas of improvement and make
the necessary program adjustments to
avoid failing.
Departments' Response: The
Departments acknowledge the
commenters' concern regarding the
limited availability of timely data that
may assist in identifying areas of
program improvement. The
Departments have clarified the
regulations regarding data availability
and sanctions in § 677. 190( c), above.
Additionally, the Departments note that
all States have access to their program
data and can use it to assess at intervals
of their own choosing to best manage
their performance, without the
Departments having to require such
action.
Comments: Some commenters
suggested using only the State average
measure of the performance indicators
rather than the average program scores
for each State in order to incentivize
partnerships among programs.
Departments' Response: Under these
regulations, failure is determined by
both individual program performance as
well as overall State performance in the
overall State indicator score. The
Departments' approach is premised on
ensuring accountability for the
individual core programs while
incentivizing the partnerships that the
Departments have concluded are critical
to WIOA' s long-term success. No change
to the regulatory text was made in
response to these comments.
Comments: Several commenters
suggested that the Departments award
monetary incentives and public
recognition in order to emphasize the
importance of performance success,
rather than setting unrealistic goals.
Departments' Response: The
Departments note that WIOA, unlike
WIA, does not authorize the use of
incentives for successful performance.
However, States may continue to utilize
incentives to recognize successful local
performance under WIOA sec.
134( a)( 3)( A)(xi). Finally, requests for
guidance concerning performance
metrics were made in order to allow for
proper administration of programs. The
Departments intend to issue further
details on performance accountability
through the WIOA Joint Performance
ICR, guidance, and technical assistance.
Comments: In addition to soliciting
public comments on the NPRM text, the
Departments posed several questions
regarding the application of sanctions
for failure to achieve adjusted levels of
performance. Many commenters
responded to the question about using a
weighted average or a straight average
for calculating State overall indicator
scores. Some commenters supported the
use of an unweighted average in order
to support the goal of shared
accountability among core programs. A
commenter stated that performance
measures should not be weighted until
it is clear how weighted averages would
be determined. Other commenters stated
that a weighted average would take into
account differences among programs
and would prevent the
misrepresentation of particular
programs. Citing the enhanced accuracy
of the system of performance, a
commenter suggested that program
performance be weighted by the number
of participants served to avoid giving
unequal weight to smaller core
programs. Other commenters urged the
Departments to weight the indicators in
order to maintain the emphasis on job
placement and employer partnerships as
established in WIOA. A few
commenters suggested that local areas
be weighted less due to their lesser
impact on wages paid within the area.
A commenter supported the use of a
weighted average if performance is to be
determined regionally, in order to take
into account the relative size of regional
WDBs. In addition, several commenters
stated that if a weighted average is
pursued, a draft weighted average
should be published for public
comment. Similarly, a commenter
suggested that the weights assigned to
each program should be determined or
agreed to by all partners. A few
commenters suggested that, in addition
to a public comment period, the weights
should be reviewed at the end of each
program year and adjusted as needed.
Departments' Response: The
Departments considered the comments
regarding the use of a weighted or
unweighted average for the
determination of performance outcomes
across programs and individual
indicators. The Departments have
decided that using unweighted
measures across the programs and
indicators still ensures performance
accountability across all core programs
and individual indicators. The
Departments conclude this, in part,
because an average performance number
weighted by the number of participants
would essentially cause each State' s
performance under Wagner-Peyser Act
Employment Service programs to have a
disproportionate impact. The Wagner-
Peyser Act Employment Service
program served more than 14 million
participants in PY 2014, which
surpasses the number of participants
served in all other core programs
combined. Using a weighted formula
would mean that the Wagner-Peyser Act
Employment Service program' s
outcomes would be determinative of a
State' s failure to achieve performance
requirements. The Departments do not
consider this to be consistent with the
performance accountability goal of
WIOA, which provides for shared
accountability across the core programs.
The Departments have concluded that
using unweighted outcomes across the
programs and indicators properly
implements WIOA in recognizing the
importance of both employment-related
and education outcomes of the
participants. No change to the
regulatory text was made in response to
these comments.
Comments: Additionally, some
commenters suggested the Departments
weight the employment indicators more
heavily than the credential and
measureable skill gains indicators.
Departments' Response: The
Departments considered these
comments, but decided not to alter the
regulation as the three employment-
related indicators make up half of all of
the WIOA performance indicators. The
three employment related indicators are
the second and fourth quarter
employment rate and the second quarter
median earnings indicator. Because
these measures make up half of all
WIOA performance indicators, the
Departments concluded they already
have a sufficient impact on a State' s
performance.
Comments: Many commenters
addressed the proposed thresholds for
performance failure of 90 percent for
each of the State overall program scores
and the overall State indicator scores,
and 50 percent of the individual
indicator scores. Numerous commenters
opposed the 90 percent threshold, citing
the current lack of core program
performance data, the unrealistic nature
of a 90 percent threshold, and the
seemingly arbitrary assignment of the
threshold. A few commenters stated that
the 90 and 50 percent threshold for
performance failure should not be
established without the required
statistical adjustment models. Many
other commenters responded to the
Departments' solicitation regarding the
potential increase of the 90 percent
threshold to emphasize the importance
55863Federal Register / Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
of performance success stating that the
90 percent threshold should not be
increased. Other commenters urged the
Departments to adopt alternate
thresholds, ranging from 70 to 80
percent, with the majority supporting an
80 percent threshold. A number of
commenters urged the Departments to
establish thresholds in guidance rather
than regulation so that they could be
more easily adjusted in the future, as
necessary. Many commenters stated that
the Departments should establish a
lower threshold than 90 percent to
allow for a phased -in approach that
gradually increases the threshold for
performance failure over time. One
commenter supported a tiered approach
in order to promote continuous
improvement. Although the vast
majority of commenters supported
maintaining or decreasing the proposed
thresholds, one commenter stated that
the 50 percent threshold for individual
performance indicators should be
increased because, as proposed, it
would weaken the requirements of
States and was not Congress' s intent in
WIOA.
Departments' Response: The
Departments considered the comments
regarding the overall 90 percent
threshold and the 50 percent threshold
for individual indicators for a program
year. The Departments considered the
various commenter -proposed threshold
levels in light of historical performance
data and historical thresholds for each
of the core programs and have decided
to maintain the thresholds as proposed.
The new thresholds are an increase from
the 80 percent threshold familiar to the
title I programs and a decrease from the
100 percent threshold for title II
programs under WIA. The Departments
consider these thresholds to be
reasonable due to the use and
application of an objective statistical
model to account for actual conditions
experienced by a program. Previously,
the title I and title II thresholds were
applied to a negotiated performance
level and performance was assessed in
the absence of weighting for actual
economic conditions or participant
characteristics. With the structure of the
performance accountability system in
sec. 116 of WIOA, the Departments
consider a 90 percent overall threshold
to strike the appropriate balance
between maintaining flexibility for
unknown mitigating variables and the
newer precision introduced by utilizing
an objective statistical model. The 50
percent performance threshold ensures
that significant performance failure on a
single indicator cannot be compensated
for by successful performance in any
other indicator or set of indicators. The
introduction of an overall State score
across programs and indicators ensures
that the performance accountability
system as articulated in sec. 116 of
WIOA maintains alignment and
integration across all of the core
programs. This overall score paradigm,
which is set at the 90 percent threshold,
and balanced with a 50 percent
threshold on any single indicator,
allows a State to account for mitigating
factors that prevent it from achieving
100 percent of its adjusted levels of
performance. It also provides that a
State has not failed to achieve its
negotiated levels of performance unless
its average performance across all
programs for one indicator or its
performance for all indicators in one
program falls below 90 percent of the
State' s adjusted targets. No change to
the regulatory text was made in
response to these comments.
Comments: One commenter expressed
concern that a program could
potentially pass the threshold for all of
the individual indicators, but not meet
the overall program or overall indicator
threshold, which would send a mixed
message to a program.
Departments' Response: In order to
pass" the threshold, each State must
meet or exceed the 90 percent threshold
for the overall State program score for
each program and the overall State
indicator score for each indicator.
Furthermore, under § 677. 190( d)( 2), the
State must not fall below 50 percent on
any individual indicator. This is an
additional safeguard against egregious
failure by one indicator being
outweighed by high scores elsewhere.
Thus, there is no possibility of what the
commenter suggested occurring. No
change to the regulatory text was made
in response to this comment.
Comments: Some commenters raised
potential alternative metrics for
evaluating success including: the use of
statistical variation metrics instead of
the proposed threshold framework;
standard deviation units or variation
against regression predictions; and
confidence intervals rather than a point
estimate.
Departments' Response: The
Departments considered utilizing these
methods, but concluded that a
consistent threshold, which does not
change from year to year based on the
size of the dataset, is the most
appropriate way to account for
variations in the core programs or the
indicators and the varying availability of
data. By creating a consistent threshold,
expected levels of performance will be
easier for program staff to understand
and allows for comparisons across
program years. No change to the
regulatory text was made in response to
these comments.
Section 677. 195 What should States
expect when a sanction is applied to the
Governor' s Reserve Allotment?
Section 677. 195 governs what will
occur when a sanction is applied to the
Governor' s Reserve for failure to report
or failure to meet adjusted levels of
performance. It clarifies that the
sanction will be five percent of the
amount that could otherwise be
reserved by the Governor.
Section 677. 195( a)( 3) was added so
that this section contains the causes of
failure as defined in § 677. 190( e) by
noting that States also are subject to a
5 percent reduction of the Governor' s
Reserve Allotment for the immediately
succeeding program year if the State' s
score for the same indicator in the same
program falls below 50 percent for the
second consecutive year. A conforming
edit was made to § 677. 195( b).
Comments: Several commenters
expressed general support for the
Departments' interpretation of WIOA
sec. 116(f) and the approach proposed.
However, numerous commenters
opposed this approach and requested
clarification regarding the
implementation of financial sanctions
only on WIOA title I programs funded
by the Governor' s Reserve allotment. A
commenter suggested that the burden of
financial sanctions be applied to the
specific programs not meeting the
performance requirements. A few
commenters requested clarification from
the Departments concerning allocation
of funding lost via sanctions. A number
of commenters urged the Departments to
permit the restoration of funds once the
State meets its reporting
responsibilities. Commenters also
remarked that sanctioned funds should
be spent on the Technical Assistance
and Performance Improvement Plan.
Departments' Response: Section
116( f)(1)( B) of WIOA does not provide
authority for the Departments to use, for
other purposes, funds that are reduced
as a sanction from the Governor' s
Reserve. Therefore, the funds may not
be used for technical assistance,
performance improvement plans, the
restoration of the Governor' s Reserve
funding, or any other activity. In
contrast, WIA provided that funds
reduced due to sanctions were to be
used by the Secretary for performance
incentive grants to the States under sec.
503 of WIA, which was not carried over
to WIOA.
The Departments considered the
comments regarding the sanctions to
WIOA title I programs being based on
55864 Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
any program' s failure. WIOA sec.
116( f)(1)( B) clearly requires that any
performance sanction must apply to the
Governor' s Reserve allotment under title
I for any core program or indicator
failure. Therefore, the Departments do
not have the authority to sanction the
specific program not meeting its
adjusted levels of performance. The
Departments strongly encourage high
levels of alignment and coordination to
ensure all core partners are engaged at
all levels. The Departments emphasize
the role of State and local planning to
ensure alignment and common goals in
attaining integration and service
delivery. Regarding the commenters'
request for clarification concerning the
allocation of funding lost via sanctions,
the Governor' s Reserve for the next
program year will be reduced by five
percentage points and money lost via
sanction will not be reallocated. No
change to the regulatory text was made
in response to these comments.
Comments: Commenters also
supported the elimination of proposed
677. 195(b) because a State could fail to
meet 2 different indicators for 2
consecutive years and receive a 5
percent sanction, but if the State fails to
meet one indicator for 2 consecutive
years and fails to report one time, the
State would receive a 10 percent
sanction. These commenters stated that
the latter scenario is a less significant
infraction and should not prompt the
imposition of a 10 percent sanction.
Departments' Response: The
Departments considered the comments
on imposing sanctions when in the
same year the State fails to submit a
performance report and is in its second
year of failure to meet adjusted levels of
performance. The Departments are
maintaining the language in § 677. 195( b)
because the Departments conclude that
failure to submit a State annual
performance report is a serious
compliance issue and should result in
sanctions. Because the regulations
provide for a 10 percent sanction on
States that fail to submit performance
reports as well as fail to meet the
adjusted levels of performance for 2
consecutive years ( 5 percent for failure
to submit report plus 5 percent for
failure to meet adjusted levels of
performance), States will have an
incentive to report to the Departments
even if they fail the adjusted levels of
performance for 2 consecutive years
because by doing so, they would receive
only a 5 percent sanction for failure to
meet adjusted levels of performance
rather than the 10 percent sanction. No
change to the regulatory text was made
in response to these comments.
Comments: Several commenters
addressed concerns regarding the
insufficient funding of the Governor' s
Reserve allotment and stated that
sanctions should be lessened or not
implemented until the allotment is fully
funded, as is statutorily required. One
commenter suggested that the
Departments scale sanctions according
to the funding available in the
Governor' s Reserve allotment.
Departments' Response: The
Departments considered the comments
regarding the funding of the Governor' s
Reserve allotment and the use of
sanctions. Statutorily, the Governor' s
Reserve is set at 15 percent of the WIOA
adult, dislocated worker, and youth
formula allocations to the States. For
several years, the Governor' s Reserve
levels were restricted below 15 percent
through the congressional
appropriation, but were restored in the
FY 2016 Consolidated Appropriations
Act. The Departments support the full
funding of the Governor' s Reserve at 15
percent as envisioned in WIOA. The
Departments note that if the Governor' s
Reserve amount is not fully funded, the
amount of funds subject to sanctions
will be proportionately less because the
sanction is either 5 or 10 percent of the
Reserve amount no matter how much
the Reserve amount is. No change to the
regulatory text was made in response to
these comments.
Comments: A commenter stated that
the sanctions for failure to report and
failure to meet a State' s adjusted levels
of performance should be separated.
Another commenter requested that the
Departments provide guidelines for a
process allowing for minor corrections
to annual reports without incurring
sanctions for failure to report.
Departments' Response: The
Departments considered the comments
regarding the separation of sanctions for
failure to report and for failure to
achieve performance. The Departments
note that these two sanctions are
applied separately. When a State fails to
meet 90 percent of its adjusted levels of
performance or fails to submit a report
in the same year, the State would incur
2 separate 5 percent sanctions totaling
10 percent. Otherwise, a State may
receive a sanction for failure to report
based on the criteria described in
677. 185 or a State may receive a
sanction for failure to achieve adjusted
levels of performance per § 677. 190.
Regarding a process to allow for minor
corrections to annual reports, the
Departments will provide a process for
this and details on the process in
guidance. No change to the regulatory
text was made in response to these
comments.
Comments: A commenter urged the
Departments to allow States flexibility
in imposing sanctions on the State
agencies responsible for the late
submission.
Departments' Response: The
Departments note that ultimately the
Governor and State Workforce Board,
which consists of representatives from
all core programs, are responsible for
the submission of the annual report. The
Departments expect the State agencies
to work together to ensure timely
reporting and, if there are expected
delays due to exceptional
circumstances, that the State provides
timely communication to the
Departments. The Departments note the
flexibility provided to States under
677. 185(b) and will work with States
that are struggling to submit timely
reports through guidance and technical
assistance. No change to the regulatory
text was made in response to these
comments.
Section 677. 200 What other
administrative actions will be applied to
States' performance requirements?
Section 677. 200 outlines the
circumstances under which a State will
be subject to additional administrative
actions when determined to be at risk
due to low performance on an
individual primary indicator, the overall
State indicator score, and the overall
State program score. No substantive
change was made to this section.
Comments: A few commenters
remarked that language in the NPRM
indicated that the Departments would
each issue their own guidance regarding
performance risk or performance
improvement plans. These commenters
were concerned that the development of
separate guidance documents signals a
lack of long-term coordination between
the Departments regarding performance
accountability and reporting. A
commenter urged DOL and WDBs to
become familiar with setting measurable
objectives, defining activities to meet
the objectives, and determining if the
objectives were achieved.
Departments' Response: WIOA
provides a unique opportunity for the
core programs to work together in new
ways, and to the extent practical the
Departments will use joint guidance so
that all core programs are provided a
clear and consistent message.
Regarding comments about DOL and
WDBs setting measurable objectives,
defining activities to meet objectives,
and determining if objectives were
achieved for purposes of the DOL -
administered core programs, this will be
communicated generally. WIOA
articulates certain performance
55865Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
requirements, the Joint WIOA Final
Rule operationalizes the provisions of
WIOA, and the Departments will
provide guidance and technical
assistance to assist States and Local
WDBs in achieving their performance
goals.
5. Local Performance Accountability for
Workforce Innovation and Opportunity
Act Title I Programs ( 20 CFR Part 677,
Subpart C; 34 CFR 361. 205 Through
361. 210; 34 CFR 463. 205 Through
463. 210)
Section 677. 205 What performance
indicators apply to local areas and what
information must be included in local
area performance reports?
This section governs which
performance indicators apply to local
areas and the information that must be
included in the local area performance
reports. While the arrangement of this
section was revised no substantive
changes were made to the regulatory
text.
Comments: One commenter noted
that the title did not fully convey what
was contained within this section of the
regulation.
Departments' Response: The
Departments concur and modified the
title of this section to clarify that this
section also governs what information
the local area must include in its local
area performance reports.
Proposed § 677. 205( a), ( b), and (c) are
implemented as proposed.
Comments: One commenter
recommended removing section
677. 205( d) of the NPRM as
unnecessary and duplicative of the
requirements of §677. 175.
Departments' Response: The
Departments agree that this section is
duplicative, and is removing it. As a
result, the Departments are renumbering
subsequent sections to conform to this
deletion.
Comments: One commenter
recommended revising proposed
677. 205( e)( 2) to clarify that in addition
to reporting on the performance
indicators, the local area report must
also include the other program
information required in the State annual
performance report, such as average cost
information.
Departments' Response: The
Departments agree that further
clarification would assist States and
local areas in complying with their
reporting requirements. The
Departments note that as finalized, this
has been renumbered as § 677. 205( d)( 1).
Since § 677. 205( d)( 1) includes all of the
information previously in
677. 205( e)( 1) and (2), the Departments
removed proposed § 677. 205( e)( 2) from
this Final Rule and have renumbered
the remainder of §677.205( d).
Comments: One commenter
encouraged adding a parallel provision
to the one that is included in
677.160(b) to clarify that the
disaggregation of data in the local area
performance report is also subject to
WIOA sec. 116( d)( 6)( C).
Departments' Response: The
Departments have added a parallel
provision at § 677. 205( e).
The Departments made a technical
edit to proposed § 677.205(f) to state
that States must comply with any
requirements from sec. 116( d)( 3) of
WIOA as explained in guidance. The
Departments made this revision to
clarify our expectations that, to the
extent that either Department' s guidance
merely explains in plain terms the
requirements that stem directly from
WIOA, the Departments expect States to
comply with those statutory
requirements.
Comments: Several commenters from
various stakeholder entities questioned
the applicability of local performance
indicators to core programs outside of
WIOA title I. Many of these commenters
specifically requested clarification on
whether other core programs were
exempt from local reporting
requirements. One commenter also
acknowledged some confusion
regarding local -level requirements and
offered several suggestions on
reorganizing this subpart to enhance
clarity. Additionally, the Departments
received a number of comments
pertaining to additional indicators of
performance, with commenters
suggesting that language be added to the
Final Rule requiring States to develop
any additional indicators of
performance only in consultation with
Local WDBs and CEOs.
Departments' Response: The
Departments acknowledge that there
may be some confusion across the core
programs regarding local -level
performance -related requirements and
are taking this opportunity to specify
that local -level accountability
requirements contained in WIOA sec.
116 pertain solely to title I adult,
dislocated worker, and youth programs.
As provided by WIOA sec. 116(b)( 2)( B)
and § 677. 165 of this regulation, the
Governor has discretion to add
additional indicators of performance.
The Departments recognize that Local
WDBs and CEOs are critical partners in
the establishment of additional
indicators of performance and strongly
encourage States to engage and consult
with Local WDBs and CEOs in their
development. No change to the
regulatory text was made in response to
these comments.
Section 677. 210 How are local
performance levels established?
Section 677. 210 explains how the
local performance levels are established.
This section has been revised and
renumbered in accordance with the
distinctions among expected,
negotiated, and adjusted levels of
performance as described in the
preamble to § 677. 170. This has resulted
in the introduction of the terms
negotiated levels" and " adjusted
levels" as it applies appropriately
within the process. Additionally, the
Departments have added language to
mirror provisions in § 677. 190 that
require 2 years of complete data for any
local core program before applying the
objective statistical model and
establishing adjusted levels of
performance.
Comments: Several comments
pertained to the negotiations process in
response to proposed § 677.210(b). A
few commenters were unclear why
Local WDBs are included in the
negotiations process described in sec.
116( c) of WIOA but are not included in
the negotiations process described in
sec. 116( b). Many commenters also
expressed a desire that the negotiations
process be meaningful, with one
commenter noting that the negotiations
process under WIA was often subjective
with performance standards dictated on
a take it or leave it basis. Similarly, a
commenter emphasized that the process
should not simply be a matter of setting
a target independently and passing it
down to Local WDBs. Another
commenter also suggested that the
overall negotiations process would be
enhanced if local areas were allowed to
provide additional information not
accounted for in the statistical models.
One commenter suggested that the
regulations contain an appeal
mechanism for Local WDBs in cases
where the State does not negotiate
performance with the Local WDB and
CEO as required by WIOA.
Departments' Response: The
Departments note that local areas are
permitted to provide additional
information during the negotiations
process. This allows the negotiations
process to take into account other
information that local areas consider
important when establishing the
negotiated levels of performance. The
Departments also note that under WIOA
sec. 116( g)( 2)( B), the local areas may
appeal the Governor' s decision to
impose a reorganization plan under
WIOA sec. 116( g)( 2)( B)( i). Therefore, if
the Governor fails to negotiate with the
55866 Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
Local WDBs, the Local WDB fails to
meet its local performance
accountability indicators as described in
WIOA sec. 116( g), and the Governor
imposes a reorganization plan, then the
Local WDB may exercise its right to
appeal under WIOA sec. 116(g)( 2)( B).
For further discussion, the Departments
refer readers to the preamble to 20 CFR
679. 130 on the functions of the State
WDB ( see DOL WIOA Final Rule
published elsewhere in this issue of the
Federal Register).
WIOA sec. 116( c)( 2) requires the
Local WDB, CEO, and the Governor to
negotiate and reach agreement on local
levels of performance. The Local WDBs
are not included in the process outlined
in sec. 116(b) because that process
pertains to State accountability, with
negotiations occurring between the State
and the cognizant Federal agency for the
core program. The Departments agree
that WIOA requires a meaningful
negotiation. The Departments encourage
the parties to negotiate which the
Departments interpret as requiring
open -communication between the
parties for the purpose of reaching an
agreement on the local performance
targets. The Departments emphasize that
the purpose of the statistical adjustment
model required under sec.
116(b)( 3)( A)(viii) is to enhance
objectivity in the development of
performance targets as part of the
negotiations process. However, because
the Departments have concluded that
the requirement to negotiate is already
conveyed through WIOA and the
regulation, the Departments do not
consider additional regulatory text
necessary to ensure States comply with
the requirements contained in sec.
116( c) that pertain to inclusion in the
negotiations process. Therefore, no
change to the regulatory text has been
made in response to this comment.
The Departments also agree that the
statistical adjustment model may not
adequately account for all of the
economic and demographic variables
that may affect a local area' s
performance. Section 677. 210( c)
requires the negotiations between the
Governor, Local WDB, and CEO to
include a discussion of the
circumstances not accounted for in the
model. Because this is already required
by the regulation, the Departments did
not make a change to the regulatory text
in response to this comment.
Comments: Another commenter
recommended that local areas have
access to the models in order to run
local targets.
Departments' Response: The
Departments note that it will publish
the methodology of the statistical
adjustment model, and the Departments
invite the public, including local areas,
to review, and access the model, as
appropriate.
Comments: The Departments received
a number of comments on the statistical
adjustment model. Some commenters
expressed concern that using the model
as proposed at the end of the program
year would result in targets being
applied retroactively. Similarly,
commenters expressed concern that
targets set through the model may not
reflect service to hard -to -serve
populations, such as foreign -born
participants often served by title II
programs or other populations with
barriers to employment. Some
commenters suggested that the model
needed to be updated on a regular basis
in order to reflect the barriers of
enrolled participants and the
participants actually served.
Departments' Response: With respect
to the utilization of the model at the end
of program year in order to account for
actual circumstances, this would not be
a retroactive application of a
performance target, but rather an
adjustment to an already established
target based on what actually transpired
during the program year. This would
take into account, as a commenter
suggested, service to hard -to -serve
populations, such as those with barriers
to employment. In other words, the
model will increase the performance
levels required if a State or local area
were to serve lower -than -anticipated
percentages of hard -to -serve populations
with barriers to employment because it
would presumably be easier to serve
these individuals. Similarly,
performance levels ( or targets) would be
decreased if a State or local area were
to serve a higher -than -anticipated
percentage of individuals with barriers,
because these individuals are harder to
serve. Given the importance both
Departments place on consistent
understanding, application, and
implementation of these complex yet
critical requirements, the Departments
are committed to providing joint and
substantive technical assistance in
addition to detailed policy guidance.
Furthermore, commenters' expressed
need to update the model to reflect the
participants who are actually being
served is one of the hallmarks of the
statistical adjustment models as
envisioned. Because the model
addresses the commenters' concerns, no
changes to the regulatory text were
made in response to these comments.
Comments: One commenter
recommended a national workgroup
with broad participation across core
programs and other WIOA stakeholders
in order to address the statistical model,
as well as other aspects of WIOA
performance accountability because of
the significance and impact of this Joint
WIOA Final Rule. One commenter
recommended that local areas be given
an opportunity to review any detailed
methodology utilized for setting
performance targets prior to
implementation.
Departments' Response: The
Departments understand the
significance of these joint regulations on
performance accountability that
implement sec. 116 of WIOA. It is for
this reason that the Departments have
convened multiple stakeholder
dialogues to address the intricacies of
the statistical adjustment models as they
are developed, consistent with, and as
required by WIOA sec.
116(b)( 3)( A)(viii).In addition, once the
statistical adjustment methodology has
been approved, there will be a comment
period to ensure broad stakeholder
input into its finalization.
Comments: Another commenter
remarked that CEOs of each local area
in a planning region should be
permitted to choose to develop, rather
than be required to develop, regional
performance measures in addition to
local area measures and recommended a
revision to 20 CFR 679. 510 to reflect
this suggested flexibility, remarking that
Local WDBs and CEOs already have a
significant responsibility regarding their
own local area performance targets;
requiring regional targets in addition to
local area targets would be unduly
burdensome.
Departments' Response: WIOA sec.
108(b)( 1) requires the CEOs to develop
the regional performance indicators and
the Departments' regulations are
consistent with this statutory
requirement. Therefore, the regulatory
text has not been changed in response
to this comment.
Comments: A commenter requested
that the Departments provide additional
information regarding the requirement
to promote continuous improvement
through performance target setting,
adding that neither the Preamble nor the
NPRM text discuss the requirement
beyond the fact that it exists. The
commenter opined that the Departments
seemed to interpret continuous
improvement under WIA as requiring
improvement on every measure, every
year, and offered their own
interpretation of continuous
improvement, which could be defined
as achieving the same results with fewer
resources or serving a population with
more barriers ( or simply a larger
population) with the same resources
i.e., increased efficiency). A commenter
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recommended, based on the context of
an optimal return on investment in
Federal funds, that setting targets
focusing on improvement of measures
with lower performance, while setting
targets consistent with existing
performance levels on measures with
higher performance, is consistent with
the requirement to set targets that
promote continuous improvement and
an optimal return on investment of
Federal funds.
Departments' Response: The
Departments agree that continuous
improvement can be defined in multiple
ways based on the circumstances and
context. Because the meaning of this
term varies significantly based on the
circumstances and context in which it is
used, the Departments do not think it is
appropriate for inclusion in the
regulation and will be providing
additional information on continuous
improvement during guidance
development. Therefore, no change was
made to the regulatory text in response
to this comment.
6. Incentives and Sanctions for Local
Performance for Workforce Innovation
and Opportunity Act Title I Programs
20 CFR Part 677, Subpart D; 34 CFR
361. 215 Through 361. 225; 34 CFR
463. 215 Through 463. 225)
Section 677. 215 Under what
circumstances are local areas eligible for
State Incentive Grants?
This section of the regulation governs
when local areas are eligible for
incentive grants.
Comments: The Departments received
a comment asking under what
circumstances local areas are eligible for
State incentive grants. Another
commenter remarked that the question
posed by the rule regarding possible
circumstances for eligibility is not
actually answered by the rule, which
instead goes on to discuss pay -for -
performance strategies.
Departments' Response: The
Departments agree that the regulatory
text in this paragraph should be revised
to ensure understanding and consistent
application. Therefore, paragraph (a) has
been revised to specify that Governors
are not required to award incentive
funds based on local performance on the
primary indicators, although they have
the flexibility to do so using State set-
aside funds based on WIOA at sec.
134( a)( 3)( A)(xi). Paragraph (b) has been
revised to clarify that Governors also
have the flexibility to create incentives
for the Local WDBs to implement pay -
for -performance contract strategies to
provide training services as described in
sec. 134( c)( 3) or youth activities as
described in sec. 129( c)( 2). However,
these incentives must be paid for with
non -Federal funds.
The Departments have chosen not to
regulate under what specific
circumstances a local area be eligible for
incentive grants using WIOA funds
given that this is at the discretion of the
Governor. However, the Departments
are considering providing guidance on
this topic. No change to the regulatory
text was made in response to this
comment.
Comments: Other commenters
remarked that separate funds should be
made available for States as an incentive
for meeting or exceeding statewide
performance targets as was the case
under WIA, with commenters
expressing concern that the dedicated
incentive grants to States were utilized
to leverage other funds and programs
and the lack of this provision in WIOA
presents a funding gap. These
commenters requested further clarity on
the issue and recommended that funds
be made available to target system
development needs.
Departments' Response: The
requirement under WIA that high -
performing States be rewarded with
State incentive grants within specified
Federal parameters no longer exists
under WIOA. Rather, sec.
134( a)( 3)( A)(xi) provides States with the
flexibility to utilize Governor' s Reserve
funds to provide incentive grants to
local areas for performance by the local
areas on local performance
accountability indicators. Further, the
Departments would like to emphasize
that, in addition to the statewide
capacity building efforts that are a
required use of the funds allotted to
States, both Departments are committed
to providing substantive technical
assistance on a national, regional, and
statewide basis in order to target
specific development needs, including
needs around performance
accountability. No change to the
regulatory text is being made in
response to this comment.
Comments: One commenter expressed
confusion about the programs included
in pay -for -performance contract
strategies and inquired as to whether the
provision applies to title II providers,
which the commenter recommended.
Departments' Response: The
Departments interpret the statutory
provision for pay -for -performance
contract strategy incentives at WIOA
sec. 116(h) as only permitted for WIOA
title I programs because of the specific
reference to title I training services for
adults and dislocated workers as well as
the reference to title I youth services.
Moreover, WIOA references Local
WDBs, which are responsible for title I
programs and providers, as the other
programs do not have Local WDBs.
However, there is nothing prohibiting
the adoption of pay -for -performance
contract strategies by other programs
that is consistent with other Federal,
State, and local policies. No change to
the regulatory text has been made in
response to this comment.
Section 677. 220 Under what
circumstances may a corrective action
or sanction be applied to local areas for
poor performance?
This section explains when a
corrective action plan or sanction may
be applied to a local area. This section
has been revised and renumbered in
accordance with the distinctions among
expected, negotiated, and adjusted
levels of performance as described in
the preamble to § 677. 170. This has
resulted in the introduction of the terms
negotiated levels" and " adjusted
levels" as it applies appropriately
within the process. Additionally, the
Departments have added language to
mirror provisions in § 677. 190 that
require 2 years of complete data for any
local core program before applying the
objective statistical model and
establishing adjusted levels of
performance. The Departments also
have revised § 677.220(b) to specify that
failure occurs when a local area fails to
meet the adjusted levels of performance
for the same indicator for the same core
program authorized under WIOA title I
for the third consecutive program year.
Comments: Several commenters
indicated that more clarity is needed
regarding how sanctions would apply
locally to other programs and funding
streams besides WIOA title I. One
commenter remarked that the impact of
local sanctions should be spread across
the other core programs. Another
commenter noted that all potential
sanctions would be placed squarely on
the shoulders of the Local WDB
regardless of fault, creating a situation it
viewed as inequitable.
Departments' Response: Any financial
sanction applied to the Governor' s
Reserve Allotment is based on State
performance across the core programs,
and not local performance. This is
governed by WIOA sec. 116(f) and
subpart B of this part. Specifically,
677. 180 through 677. 200 govern
when the Departments will sanction a
State. The Departments note that the
local area provisions under WIOA sec.
116( c) only apply to WIOA title I
programs. The other core programs may
participate, partner, and provide
services in a local area, but, there is no
local area performance accountability
55868 Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
provision for those programs. However,
local areas are held accountable for
performance on the primary
performance indicators for title I
programs. Local -level accountability
and any sanctions imposed are
determined by the State, consistent with
WIOA sec. 116( g) and subpart D of this
part. Therefore, the Departments are not
changing the regulatory text in response
to these comments.
Comments: Several commenters
responded to the Departments' request
for feedback regarding what other
actions in addition to those already in
statute should be considered by the
Governor for local areas that continue to
fail to meet performance for 3
consecutive years. Many commenters
offered suggestions but stated the need
for clarification first on what is meant
by " failure to meet adjusted levels of
performance on required indicators for
a third consecutive year,"
recommending that local area failure for
a third consecutive year be based on the
same indicator and not any indicator.
Departments' Response: The
Departments have defined " failure to
meet" adjusted levels of performance at
the State level across the core programs
based on the primary indicators of
performance and criteria delineated in
677. 190 of these regulations.
Determining what is meant by " failure
to meet adjusted levels of performance
on required indicators for a third
consecutive year" at the local level is
within the Governor' s discretion per
677. 220( a)( 1), which is similar to the
historical requirements that existed
under WIA. Because defining these
terms is within the Governor' s
discretion, the Departments think this is
not appropriate to be addressed in these
regulations. No change to the regulatory
text was made in response to these
comments.
Comments: One commenter proposed
another reason for the Departments to
define " failure to meet adjusted levels of
performance" arguing that a local area
could be making significant progress
towards improving performance but
could potentially miss the required level
by a fraction of a point. The commenter
added that the lagged performance data
complicates matters further and that
some systemic performance issues may
take more than 3 years to correct. For
these reasons, this commenter suggested
changing the regulatory language of
fails to meet" to " fails to make
satisfactory progress."
Departments' Response: The
Departments' requirement to determine
when a corrective action or sanction can
be applied to a local area is based on
statutory language and the Departments
will not modify this requirement.
Therefore, no change to the regulatory
text was made in response to this
comment.
Comments: Several commenters
offered suggestions for additional
actions that might be taken by the
Governor in addition to those already
specified in regulatory text. Some
commenters suggested that the Governor
should be authorized to apply a
financial sanction, with one commenter
adding that the Governor should be
authorized to dissolve a local area for
continued failure, and other
commenters recommended that the
Governor also be authorized to
consolidate local areas. Another
commenter supported the Governor' s
flexibility, noting that redesignation of a
local area is an inequitable penalty
when compared to the penalties WIOA
prescribes for State workforce agencies
that fail to meet required performance
levels. Other commenters, including a
number of Local WDBs, expressed
concern that the language in the
regulatory text allowing Governors to
take significant actions as deemed
appropriate was too broad in scope and
could be used to redesignate or
eliminate local areas, suggesting at a
minimum that parameters be specified
at the Federal level. These commenters
also stated that any additional actions
taken by the Governor should be
required to include consultation with
the local elected official, although one
commenter suggested the mandatory
consultation with local elected officials
should extend to any actions related to
technical assistance. One commenter
also inquired about the absence of any
reference to failing performance for 2
consecutive years, stating it was clear
that technical assistance was required
after the first year, and it was clear a
reorganization plan was needed after the
third consecutive year, but the
regulations were silent on what would
take place after the second consecutive
year of failure.
Departments' Response: The
Departments considered the comments
regarding additional significant actions
that might be taken by a Governor for
continued local performance failure and
concluded that there is nothing
prohibiting a State from considering
financial sanctions as a potential
significant action" as part of the
reorganization plan. Therefore, no
Federal action is needed to permit this.
The Departments also agree that
significant actions taken by the
Governor pursuant to § 677.220(b)( 3)
would be most effective if they included
a consultation with the local elected
official and other local stakeholders,
and therefore, recommend the Governor
do so. However, the Departments do not
think a change in regulatory text is
necessary as WIOA and regulation do
not preclude the Governor from doing
this. The Departments do not agree that
regulatory text is necessary requiring
consultation with local elected officials
occur prior to the provision of any
technical assistance as this is not
required by WIOA and the process for
providing technical assistance is at the
Governor' s discretion. Therefore, the
Departments have chosen not to regulate
this. Regarding the comment pertaining
to failure for a second consecutive year,
WIOA sec. 116( g)( 1) makes clear that
failure " for any program year" will
trigger the provision of technical
assistance; therefore, if failure occurs in
the second consecutive year, the
Governor is obligated to provide
technical assistance, or request the
Secretary of Labor to do so. In response
to comments that the Governor could
consolidate, redesignate, or dissolve a
local area through the reorganization
plan, the Departments note that WIOA
sec. 116( g)( 2) leaves what actions are
most appropriate to take when a local
area fails to meet its local performance
accountability indicators, to the
Governor' s discretion. Therefore, the
Departments will not change regulatory
text in response to these comments.
Comments: One commenter requested
clarification on § 677.220(b)( 2), which
allows the Governor to prohibit the use
of eligible providers and one-stop
partners that have been identified as
achieving poor levels of performance as
an action that may be taken as part of
a reorganization plan. The commenter
pointed out that neither WIOA nor
proposed regulations addressed poor
performance levels of one-stop partners,
such as TANF, and suggested that the
NPRM was referring to a competitively
procured contractor or one-stop center
operator.
Departments' Response: The language
in the regulation is statutory language
from WIOA sec. 116(g)( 2)( A)(ii),and the
Departments do not have authority to
change the requirements of WIOA. No
change to the regulatory text was made
in response to this comment.
Comments: The Departments also
received a number of general comments
pertaining to this paragraph. One
commenter wanted to ensure that any
technical assistance for youth programs
be developed by experienced youth
experts that also could include youth
who have successfully navigated the
system and who are now employed.
This commenter also cautioned against
assumptions that a particular youth
program may be causing the
55869Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
performance failure. Another
commenter strongly recommended that
the Departments delay enforcement of
the sanctions provisions for at least 2
years to further calibrate the statistical
adjustment model, during which time
States could approach implementation
in a methodical manner that allowed for
the application of lessons learned
without strict penalties. Other
commenters offered a similar
suggestion, recommending that an
additional 2 years was needed to
implement these requirements, during
which time the Departments should
launch an intensive and nationwide
technical assistance effort. Another
commenter recommended transitional
implementation in conjunction with the
development of a national workgroup of
broad stakeholders and experts to tackle
each aspect of performance
accountability, including the imposition
of sanctions.
Departments' Response: The
Departments expect the technical
assistance the Governor provides
pursuant to § 677. 220( a) will be well-
informed and developed with input
from subject matter experts and agrees
that former youth participants can offer
a valuable perspective on technical
assistance needs based on their own
experience. In response to comments
requesting delayed implementation of
performance at the local level, the
Departments received similar comments
on the State -level performance
accountability. In response to those
comments, the Departments have
revised § 677. 190( c) to provide that the
Departments expect full implementation
of the performance accountability
requirements to take some years, given
the complexity of WIOA' s requirements
and the timing of the availability of data
necessary to populate the statistical
adjustment models, for instance. At the
local level, the decisions on
performance implementation are at the
Governor' s discretion and subject to the
requirements of 20 CFR part 679 ( see
DOL WIOA Final Rule, published
elsewhere in this issue of the Federal
Register). Therefore, no change to the
regulatory text is being made in this part
in response to this comment. Additional
information on implementation will be
provided by the Departments in
guidance.
Section 677. 225 Under what
circumstances may local areas appeal a
reorganization plan?
This section of the regulation governs
the process for an appeal if the local
area wishes to appeal a reorganization
plan. The Departments received few
comments on the proposed text for this
paragraph of the regulations. The
Departments are implementing this
regulation as proposed, except for a
revision to § 677. 225( d) which is
described below.
The Departments revised paragraph
d) of § 677. 225, replacing " to impose a
reorganization plan" with " on the
appeal" for consistency with the
relevant WIOA provision. WIOA sec.
116( g) governs the consequences for a
local area' s failure to meet local
performance accountability indicators
for the youth, adult, or dislocated
worker programs. WIOA sec. 116( g)( 2)
requires the Governor to develop a
corrective action plan if the local area' s
failure continues for a third consecutive
year. The local area and CEO of the local
area may appeal this decision to the
Governor. The Local WDB and CEO may
appeal the Governor' s decision on the
appeal to the Secretary of Labor. The
proposed version of this paragraph
stated that the Governor' s decision to
impose a reorganization plan becomes
effective at the time it is issued.
However, WIOA sec. 116(g)( 2)( C)
provides that it is the Governor' s
decision on the appeal, not the
reorganization plan, that becomes
effective unless the Secretary of Labor
rescinds or revises the plan.
Comments: One commenter
recommended a revision to the
regulatory text to clarify that if the
Secretary of Labor does not respond to
a joint appeal pursuant to § 677. 225( c)
within 30 days, then the Governor' s
decision to impose a reorganization plan
automatically results in the
reorganization plan becoming effective.
Departments' Response: Section
677. 225( c) clearly requires the
Departments to respond within the
specified timeframe. The statutory text
does not provide for automatic
effectiveness of the plan if the Secretary
of Labor does not respond within the
30 -day timeframe. No change to the
regulatory text was made in response to
these comments.
7. Eligible Training Provider
Performance for Workforce Innovation
and Opportunity Act Title I Programs
20 CFR Part 677, Subpart E; 34 CFR
361. 230; 34 CFR 463. 230)
Section 677. 230 What information is
required for the eligible training
provider performance reports?
Section 677. 230 implements the
requirements of sec. 116( d)( 4) of WIOA,
which requires annual ETP performance
reports. The ETP performance reports
provide critical information, including
the employment, earnings, and
credentials obtained by individuals in
the program of study eligible to receive
funding under the adult and dislocated
worker formula programs under title I of
WIOA. This information will he of
significant benefit in assisting WIOA
participants and members of the general
public in identifying effective training
programs and providers. The
information will also benefit providers
by widely disseminating information
about their programs increasing
awareness of the program and
potentially as a tool to enhance their
programs.
Section 677. 230( b) has been revised to
specify that the registered
apprenticeships programs referred to are
those registered under the National
Apprenticeship Act. This section, in
conjunction with 20 CFR 680.400
through 680. 530, establishes the
minimum requirements for performance
information to be provided in the ETP
performance reports. Additional
information on these requirements and
the data to be collected is provided
through the WIOA Joint Performance
ICR. The Departments inserted
mechanism of" into § 677. 230( c) to
clarify that the State must provide a
mechanism of electronic access to the
public ETP performance report in its
annual State performance report. This
edit was made for consistency with
677. 160( c).
Comments: The Departments sought
specific input on how the Departments
could best support ETPs in meeting the
requirements of this section as well as
on how to make the ETP reports a useful
tool for WIOA participants, ETPs,
interested stakeholders, and the general
public. Multiple commenters suggested
the Departments could support ETPs in
meeting the requirements of subpart E
by providing reporting formats and
instructions in order to establish the
basis for data collection. A commenter
remarked that guidance to States would
help streamline performance reporting
for training providers and minimize the
associated burden.
However, other comments suggested
the Departments avoid being too
prescriptive in order to maximize the
accessibility of the reported data. A few
commenters suggested that the
increased volume of data collection
necessitates technical assistance and
funding support from DOL.
Departments' Response: The
Departments recognize that in many
cases the ETP reporting provisions will
be different from what was standard
under WIA. In recognition of this, the
Departments are issuing definitions on
the elements required under this
provision through the WIOA Joint
Performance ICR in accordance with the
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PRA. The Departments crafted the
definitions as they pertain to ETP
reporting with consideration of
commenter suggestions, industry
standards, and statutory requirements
while balancing the need for clarity and
flexibility. Although the Departments
agree these definitions are needed, they
are appropriately handled through the
aforementioned WIOA Joint
Performance ICR.
Comments: Several commenters
asserted that the Departments must
permit an alternate definition of
participant" and/ or " exit" for use in
ETP reporting. These commenters noted
that they would require considerable
local flexibility in the application of
these definitions. Commenters further
articulated a need for technical
assistance around the data collections
associated with these definitions.
Departments' Response: As
mentioned above, through the WIOA
Joint Performance ICR, the Departments
are issuing definitions of how these
terms are used in ETP reporting. These
definitions balance the needs for
consistency and flexibility. No change
to the regulatory text was made in
response to these comments.
Comments: A few commenters
suggested that the performance metrics,
which are required to be reported for all
individuals in a program of study, be
waived for non-WIOA participants for
the first 2 years to provide sufficient
time to establish the required data
systems to collect and report on these
elements.
Departments' Response: The
Departments have given consideration
to the systems readiness to implement
these provisions and understand that
implementation will require guidance
and technical assistance in order to
assist States in this implementation. No
change to the regulatory text was made
in response to these comments.
Comments: A commenter stated that
data collected should align with existing
data collected on educational programs
from other sources in order to maximize
its usefulness to consumers.
Departments' Response: The
Departments considered this concern,
however, the data being collected are
required by WIOA sec. 116( d)( 4).
Therefore no change to the regulatory
text has been made in response to this
comment.
Comments: A few commenters stated
that since many training providers serve
small populations, the data they report
would not be statistically reliable
indicators of performance. Similarly, a
commenter requested clarification
regarding the application of the
disaggregation requirements to
individual ETPs.
Departments' Response: The
Departments recognize the contribution
of ETPs that may serve smaller
populations. The Departments note that
the data disaggregation requirement in
WIOA sec. 116(d)( 6)( C) also applies to
the ETP performance reports. The
Departments will provide additional
information on the parameters of the
collection and reporting of this
information through the WIOA Joint
Performance ICR and program -specific
guidance. This information is required
to he collected under WIOA sec.
116( d)( 4); therefore, no change to the
regulatory text has been made in
response to these comments.
Comments: A commenter urged the
Departments to provide States
maximum flexibility in displaying
provider performance data in order to
allow for State experimentation and to
ensure compatibility with technology
platforms. Another commenter
suggested that the " scorecards" already
developed by Local WDBs should be
considered as a model.
Departments' Response: WIOA sec.
116(d)( 1) and (4) require the use of `a
template' developed by the Departments
to report on outcomes for eligible
training providers and this template
must be used consistent with the
requirements of WIOA sec. 116 and this
regulation. However, the use of this
template does not preclude the States
from additionally displaying
performance data in a manner of their
choosing and the Departments welcome
innovative approaches to displaying this
information in a user-friendly manner.
No change to the regulatory text was
made in response to these comments.
Comments: A commenter stated that if
this data were a Federal requirement
collected through ED, there would be a
more consistent national approach.
Departments' Response: WIOA sec.
116( d)( 4) requires the collection and
reporting of this information on eligible
training providers therefore no change
to the regulatory text has been made in
response to this comment.
Comments: A few commenters
suggested that the possible barriers to
employment be standardized for the
purpose of the ETP performance report.
Departments' Response: The
Departments recognize the importance
of standardized and uniform definitions
to provide data that are comparable
across programs and States. The
Departments note that specific
calculations, definitions, and reporting
parameters will be provided through the
WIOA Joint Performance ICR; therefore,
no change has been made with respect
to defining barriers to employment in
this section. No change to the regulatory
text was made in response to these
comments.
Comments: A commenter identified
the most important data to be reported
as training program completion rates,
wage rates, and job placement rates.
Departments' Response: The
Departments acknowledge the
suggestions raised regarding information
that is valuable to understanding the
outcomes of training programs. WIOA
provides specific collection
requirements at sec. 116(d)(4), which
includes much of the data suggested by
the commenter, and further information
as it pertains to the reporting
requirements for these programs can be
found in the WIOA Joint Performance
ICR. No changes to the regulatory text
were made in response to this comment.
Comments: A commenter stated that
the performance outcomes only should
be collected on those participants
receiving services under WIOA title I,
subtitle B.
Departments' Response: WIOA sec.
116( d)( 4)( a) requires reporting on the
primary indicators of performance for
all students in the program of study,
therefore no change has been made in
response to this suggestion. No change
to the regulatory text was made in
response to this comment.
Comments: A commenter asserted
that the ETP reporting requirements
should be kept flexible to provide local
providers the greatest choice in training
providers. Commenters urged the
Departments to allow ETP eligibility to
last more than 1 year in order to
generate enough participants and exits
to provide a useful outcome
measurement. A commenter remarked
that WIOA authorizes Governors to
establish a transition period for ETPs
under WIA to remain on the list through
2015. A commenter suggested that the
Departments require States to list
credentialing programs on ETP lists
ETPLs) in order to provide the most
comprehensive information.
Departments' Response: WIOA sec.
122 governs this process; therefore, the
Departments refer readers to the
discussion of 20 CFR part 680 in the
DOL WIOA Final Rule (published in
this issue of the Federal Register) for
responses to these comments and more
information regarding these issues. No
change to the regulatory text was made
in response to these comments.
Comments: The Departments received
numerous comments requesting clarity
and further information on the
interaction between the provisions in
WIOA sec. 116( d)( 4) Eligible Training
Provider performance report and the
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performance reporting required for
training provider eligibility under
WIOA sec. 122 ( 20 CFR part 680, see
DOL WIOA Final Rule).
Departments' Response: WIOA sec.
116( d)( 4) requires that the ETP
performance report must be prepared
annually and the States must provide
electronic access to this report in their
State annual performance report
pursuant to § 677. 160( c). WIOA sec. 122
governs the process for determining
training provider eligibility; this process
requires calculation of certain
performance information. As many
commenters noted, there is significant
overlap in what must be included in the
WIOA sec. 116( d)( 4) report and the
information providers must provide for
the eligibility determination under
WIOA sec. 122. The Departments
recognize this overlap may provide
opportunities for States to collect this
information for both purposes. Further
information concerning ETP reporting
requirements and performance reporting
requirements is available through the
WIOA Joint Performance ICR. The
Departments will also be providing
technical assistance in regard to these
reporting requirements. No change to
the regulatory text was made in
response to these comments.
Under 20 CFR 681. 550, DOL allows
the use of individual training accounts
ITAs) for out-of-school youth ages 16 to
24. The parameters for this allowance
are discussed in the preamble to that
section. The Departments clarify here
how youth are reported on in the WIOA
sec. 116( d)( 4) eligible training provider
performance reports. The Departments
clarify that such out-of-school youth are
reported on in both the eligible training
provider performance report as well as
in the State and Local annual reports.
Because WIOA sec. 116( d)( 4) does not
describe such youth, the Departments
are clarifying here as well as in the
WIOA Joint Performance ICR how these
youth program participants are reported
on in these reports. When such youth
are reported on in the eligible training
provider performance reports, their
performance is reported using the same
performance indicators as prescribed for
WIOA adult and dislocated worker
participants. Using the same metrics
minimizes the burden on ETPs. The
Departments note that such youth are
excluded from the required reporting
identified at § 677. 230( a)( 1)( i) through
iii) but are included in the counts
required by § 677. 230( a)( 2) through
a)( 4). The Departments further note that
such youth are additionally reported on
in the State and Local annual reports in
accordance with §§677. 155( d), 677. 160,
and 677. 205, as described in those
sections. The Departments will provide
additional guidance on the treatment of
these individuals through the WIOA
Joint Performance ICR and in guidance.
Comments: A number of commenters
responded to the Departments' request
for comments regarding support for
registered apprenticeship programs
interested in providing performance
information. A few commenters
suggested that registered apprenticeship
programs should report on the same
performance outcomes as other training
programs. Another commenter urged the
Departments to require registered
apprenticeships to publish performance
data. Other commenters suggested there
is value in having a comprehensive list
of registered apprenticeship providers,
but opposed additional reporting
requirements for these programs. A
commenter stated that if pre -
apprenticeship programs are to be
included in the ETP system, they will
likely require separate criteria. Another
commenter stated that performance
information for registered
apprenticeship programs should be
clearly described.
Departments' Response: The
Departments have concluded that WIOA
sec. 116( d)( 4) does not require registered
apprenticeship programs to provide
performance information for the ETP
report. However, the Departments note
that including information for a
registered apprenticeship in these
reports would provide a benefit to those
individual seeking training through
registered apprenticeships in that they
will gain visibility and access to a
broader applicant pool by voluntarily
participating in this reporting.
Therefore, the Departments are
implementing § 677. 230( b) as proposed
to allow for the voluntary submission of
performance information from
registered apprenticeship program
sponsors and their providers of related
technical instruction. Any such
information must be published in the
State' s annual ETP performance reports.
With regard to the creation of a
comprehensive list of registered
apprenticeships the Departments note
that such a requirement is beyond the
scope of this regulation. No change to
the regulatory text was made in
response to these comments.
Comments: A commenter supported
the creation of incentives for registered
apprenticeship programs to submit
performance information.
Departments' Response: The
Departments are not creating additional
incentives but notes that incentive for
reporting already exists as explained
above. No change to the regulatory text
was made in response to this comment.
Comments: A commenter encouraged
the Departments to account for positive
outcomes from registered
apprenticeship programs, even if the
outcome is not necessarily completion
of the program because programs could
be several years in length.
Departments' Response: To the extent
that the registered apprenticeship is
actively reporting the information
required under these provisions
includes such information as
measureable skill gains, which accounts
for progress made during participation
of a registered apprenticeship. No
change to the regulatory text was made
in response to this comment.
Comments: The Departments received
multiple comments on how to calculate
the average cost per participant for those
who received training services for the
most recent program year and the 3
preceding program years as required by
WIOA sec. 116( d)( 4)( E) and
677. 230( a)( 3). One commenter noted
that this metric is not currently
collected. Such suggestions included:
Calculating at the education or training
program level, rather than the
participant level; aligning calculations
with existing national reporting
standards, such as the Integrated
Postsecondary Education Data System;
calculating based on the tuition plus
any support services ( e.g., books,
supplies, transportation) necessary to
succeed in the training; calculating
based on actual training costs for a
student, including portions paid for
with government subsidies; and
calculating based on the direct cost paid
under WIOA title I funding.
Departments' Response: The
Departments considered these
proposals; however, the Departments
have concluded that the cost per
participant is more appropriately
addressed in the WIOA Joint
Performance ICR, which provides more
specificity around what underlying data
are necessary and how such data will be
used in calculating this information.
The Departments will provide
additional information on how this
metric is calculated through the WIOA
Joint Performance ICR, guidance, and
technical assistance. No change to the
regulatory text was made in response to
these comments.
Comments: Commenters expressed
concern that the ETP performance
report does not provide sufficient cost
information because it does not take
into account other factors such as,
textbooks, supplies, transportation, etc.
Departments' Response: WIOA sec.
116( d)( 4) and § 677. 230 mandate the
collection of specific information for
each program of study for each eligible
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provider of training services under title
I as outlined in § 677. 230( a). The
Departments are cognizant of the
reporting burden the ETP performance
report places on ETPs and do not want
to place additional burden on these
entities. However, WIOA sec. 122 and
20 CFR part 680 require States to
develop procedures for determining the
eligibility of training providers and
programs and to make information
about the provider and program
available to participants and members of
the public. The WIOA sec. 116( d)( 4)
ETP performance report is only one
component of an overall consumer
product. States are not precluded from
developing additional resources for
consumers and the Departments
encourage States to identify additional
information that would be most helpful
for students to have as they are
evaluating a program or provider. No
change to the regulatory text was made
in response to these comments.
Comments: Numerous commenters
raised issues on the burden posed for
training providers. Such as:
A commenter asserted that many
small training providers, particularly
those in rural areas, would be unable to
comply with ETP performance reporting
requirements, which would limit
available trainings.
A commenter expressed concern
regarding the burden associated with
collecting data reliant on SSNs, stating
that many community colleges do not
collect student SSNs.
A commenter described the
increased data collection burden
associated with obtaining the SSNs for
all enrolled students, and, if deemed
necessary, establishing data sharing
agreements with each of the individual
ETPs.
A commenter asserted that the costs
associated with collecting, maintaining,
and reporting out data are unknown and
will vary depending on the entity
responsible for these processes.
This commenter also suggested that
entities applying for inclusion on the
State ETPL may not capture the required
demographic and programmatic data
that would allow for the production of
the performance report.
A few commenters suggested that
many of the reporting elements would
not be valuable and would impose a
significant burden at the State and local
level.
Multiple commenters suggested that
many training providers do not have the
capability or desire to report the
proposed level of data on a regular
basis, and this will lead to a decrease in
training provider participation.
Departments' Response: The
information required to be reported is
required by WIOA sec. 116( d)( 4). The
Departments reiterate that the ETP
performance reports provide critical
information, including the employment,
earnings, and credentials obtained by
individuals in the program of study
eligible to receive funding under the
adult and dislocated worker formula
programs under title I of WIOA. This
information will be of significant benefit
in assisting WIOA participants and
members of the general public in
identifying effective training programs
and providers. The information will also
benefit providers by widely
disseminating information about their
programs and potentially as a tool to
enhance their programs. No change to
the regulatory text was made in
response to these comments.
Comments: Many commenters
addressed § 677. 230( e)( 3) which
contains the provisions allowing the
Governor to designate one or more State
agencies such as a State Education
Agency or State Educational Authority
to assist in overseeing the eligible
training provider performance. Several
commenters suggested designating the
State as responsible for ETP data
collection, coordination, and
dissemination. These commenters
suggested that their proposed approach
would ensure local staff time is spent
serving participants and that the data
are consistently collected and reported
across the State. A few commenters also
stated that the burden on training
providers would be minimized by not
requiring collection of any data the State
already has. A few commenters
suggested aligning the ETP eligibility
determination process with the data
reporting process in order to minimize
burden. A commenter sought
clarification regarding the role of
training providers in generating ETP
performance reports and collecting data
on participants.
Departments' Response: The
Departments note that § 677. 230( e)
allows many such actions as
recommended by the commenters.
Additionally, the Departments reiterate
that to the extent that there is overlap
between data collected to meet
requirements under WIOA sec. 122 and
WIOA sec. 116 this overlap may provide
opportunities for efficiency in collection
and reporting of this information for
both purposes. No change to the
regulatory text was made in response to
these comments.
Comments: Commenters expressed
concern regarding the level of burden to
eligible training providers for collecting
the required data.
Departments' Response: The
Departments acknowledge the need to
identify the most effective data
collection strategies and have reviewed
the comments received through the
WIOA Joint Performance ICR. Based on
comments received, the Departments
have concluded that State grantees are
best situated to make the ETP
performance reports available to ETA
given their existing familiarity with the
reporting structure. Grantees are
required to establish a process to collect
the data from the eligible training
providers. The Departments will
provide additional guidance on the ETP
performance report.
Comments: In order to facilitate the
reporting process, a commenter
suggested that all training providers
should report outcomes in the same
format to facilitate cross -program
comparisons and identify
underperforming vendors.
Departments' Response: The
Departments agree that reporting data in
the same format would facilitate cross -
program comparisons and WIOA sec.
116( d)( 1) requires the Departments to
develop a template for the annual ETP
performance report. This section of
WIOA requires the ETPs to use this
report; therefore, all annual ETP
performance reports will have outcomes
listed in the same report to facilitate
cross -program comparisons. Because
this is already accomplished through
WIOA and the regulation, the
Departments did not make any changes
to the regulatory text based on this
comment.
Comments: Another commenter
suggested that each program of study
that a provider wants to be eligible to
serve WIOA-funded students should be
required to report.
Departments' Response: Under WIOA
sec. 116( d)( 4), the required reporting on
a program of study only applies to those
eligible training providers who are
already on the State list of Eligible
training providers and programs.
Additional information on eligibility
requirements is found in 20 CFR part
680, subpart D. The Departments also
note, however, there is nothing in WIOA
that precludes a State or an Eligible
Training provider from providing or
publishing similar information. No
change to the regulatory text was made
in response to this comment.
Comments: A commenter pointed out
that entrepreneurship training would
not score well on the performance
indicators unless a recognized
credential is developed.
Departments' Response: The
Departments acknowledge concerns
raised with regard to training that is
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targeted at self-employment and
recognizes that individuals who are self-
employed would not be accounted for in
State UI wage records. However, the
Departments note that WIOA sec.
116( d)( 4) identifies more than just
employment or credential based
outcomes. Such indicators as
measurable skill gains combined with
the allowance to collect and verify
employment information through
supplemental means as described more
fully in the preamble to § 677. 175
provides alternative points of
information on outcomes associated
with such trainings. The Departments
have not made any revisions to this
section with regard to this comment.
Further clarification on the allowed
sources of data and calculations for
these provisions will be provided
through the WIOA Joint Performance
ICR. No change to the regulatory text
was made in response to this comment.
8. Performance Reporting
Administrative Requirements ( 20 CFR
Part 677, Subpart F; 34 CFR 361. 235
Through 361. 240; 34 CFR 463. 235
Through 463. 240)
Section 677. 235 What are the reporting
requirements for individual records for
core Workforce Innovation and
Opportunity Act (WIOA) title I
programs; the Wagner-Peyser Act
Employment Service program, as
amended by WIOA title III; and the
Vocational Rehabilitation program
authorized under title I of the
Rehabilitation Act of 1973, as amended
by WIOA title IV?
This section of the regulations
requires all of the core programs—
except for the title II program—to report
using individual records, as opposed to
aggregate data. While the NPRM would
have required that records submitted to
DOL must be submitted in one record
that is integrated across all core DOL -
administered programs, the regulatory
text has been revised to read that such
records " may" be submitted in an
integrated format.
Comments: Many commenters
expressed a range of concerns regarding
the proposed reporting requirements
that appear to be based on incorrect or
incomplete information. For instance,
one commenter asserted that WIA
required an SSN for program
participation, whereas the Wagner-
Peyser Act Employment Service
program did not, thereby resulting in
data deficiencies regarding the matching
of wage records, which should be
addressed under WIOA.
Departments' Response: The
provision of a SSN is strongly
encouraged to facilitate objective
performance measurement through the
use of wage records; however, requiring
an SSN as a condition of program
participation has been and remains a
violation of the Privacy Act of 1974, 5
U. S. C. 552a Note, which DOL has
previously clarified in policy guidance.
See TEGL No. 5-08, " Policyfor
Collection and Use of Workforce System
Participants' Social Security Numbers."
No change to the regulatory text was
made in response to these comments.
Comments: Another commenter
suggested that, because one integrated
record was required for each participant
across all core programs, sufficient time
should be provided to implement this
paragraph, and it should be
implemented no earlier than July 1,
2018. One commenter noted that State
VR agencies are not part of the
Workforce Investment Streamlined
Performance Reporting (WISPR) system
and suggested that States should be
allowed to file separate reports for the
VR program.
Departments' Response: While the
Departments want to make clear that
there is no requirement that
performance reporting for the
Departments of Labor and Education be
integrated, the Departments encourage
moving in that direction. For States that
have integrated reporting of WIOA title
I core programs and Wagner-Peyser Act
Employment Service programs, DOL
strongly encourages those States to
submit an integrated report. This
provision regarding the submission of
integrated reports does not extend to the
AEFLA and VR programs administered
by ED. However, the Departments note
that as previously discussed, DOL
intends to work towards developing an
integrated reporting mechanism. No
change to the regulatory text was made
in response to this comment.
Comments: Another commenter
disagreed with the Departments'
intention to have States integrate and
submit their performance reporting as a
single, comprehensive, aggregate report
because it would incur an undue and
unrealistic burden.
Departments' Response: As explained
above, this is not a current requirement.
The Departments understand that there
would be a burden with submitting a
single, aggregate report to be submitted
by one State agency when the different
programs may currently be housed in
different departments or agencies.
Comments: Several commenters were
also under the impression that all of the
core programs currently utilize
individual records, with one commenter
asserting that the comment had been
validated by WIOA staff across multiple
States.
Departments' Response: The
Departments also would like to clarify
that five of the six core programs
currently transmit individual records to
their respective Departments. The ED' s
OCTAE, which administers title II
programs, does not receive individual
records from State Adult Education
Agencies. It is noted that for title II,
State eligible agencies are required to
collect individual records on a quarterly
basis and submit annually aggregated
data using individual records. The
Departments acknowledge the need for
guidance on program reporting as well
as technical assistance needed to ensure
consistent understanding for
implementation. No change to the
regulatory text was made in response to
these comments.
Comments: Many commenters
expressed opposition to the exclusion of
title II programs from the individual
records reporting requirements. Several
articulated that the expectations for
system alignment through integrated
reporting discussed in the NPRM would
be undercut by the proposal to exclude
title II from the same quarterly reporting
requirements as the other five core
programs. One commenter remarked
that title II programs should be included
in these reporting requirements in the
spirit of true integration. And, and as
previously noted, some commenters
were under the impression that all of
the core programs already use
individual records, thereby making the
exclusion of title II unwarranted.
Departments' Response: Although
ED' s Office of Career, Technical, and
Adult Education does not collect
individual records at the Federal level,
States are required to maintain
individual record systems that meet
strict standards. States are required to
collect such data quarterly and aggregate
the data to meet performance
requirements in an annual submission.
No change to the regulatory text was
made in response to these comments.
Comments: Several commenters
suggested that the burden for the
proposed reporting requirements was
considerably underestimated and
should reside at the Federal level, with
some suggesting the additional
requirements constitute an unfunded
mandate, particularly for the VR
program, which must incur the
significant cost and staff training needed
to transition from annual reporting of
the RSA 911 to the proposed quarterly
reporting of the RSA 911. Many of these
commenters recommended that a
currently available tool be utilized to
validate RSA 911 data on a quarterly
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basis without the requirement for full
quarterly report submission.
Additionally, there were concerns
raised regarding data that are collected
through the VR program, which falls
under the confidentiality requirements
under 34 CFR 361. 38 that may prohibit
the release of social security
information.
Departments' Response: The ED' s
RSA acknowledges that additional time
and resources as well as staff training
will be needed to accomplish statutory
requirement while ensuring consistent
understanding and nationwide
implementation. There is no provision
in 34 CFR 361. 38 that prohibits the
release of SSNs for reporting purposes
since the reporting requirements are
necessary for the administration of the
VR program. Therefore 34 CFR 361. 38( b)
does not require informed written
consent for the release of PII for this
purpose. However, there may be other
Federal or State laws that would govern
such releases. Further, the Departments
refer to the VR Performance ICR for the
RSA -911 form where burden for
collection and reporting this
information in the RSA 911 are further
addressed. No change to the regulatory
text was made in response to these
comments.
Comments: The Departments received
comments on aspects of this part related
to calculations for indicators and
performance information, structure and
compilation of individual records, and
formatting for the collection of
underlying data for the reports.
Departments' Response: Because of
the level of detail these comments
sought on the more specific technical
aspects of this part, the Departments, as
discussed throughout this regulation,
reiterate that such information will be
provided through the WIOA Joint
Performance ICR or Department -specific
ICRs, as well as associated program
guidance. No change to the regulatory
text was made in response to these
comments.
Section 677. 240 What are the
requirements for data validation of State
annual performance reports?
Section 677. 240 provides the
requirements for data validation of State
annual performance reports. It has been
revised to specify that performance
reports should be consistent with the
requirement for data validation in
WIOA sec. 116( d)( 5).
Comments: Several commenters
requested guidance for conducting data
validation across core programs.
Commenters specifically asked for
guidance concerning where the
responsibility for data validation lies
when participants are co -enrolled in
two or more partner programs.
Commenters also asked for clarification
regarding the distinction between State
and local roles in annual reporting.
Multiple commenters supported either
the postponement of the effective date
for data validation requirements until
July 2017 or the gradual implementation
of data validation requirements,
particularly if the validation pertains to
new data that are required to be
collected. Some of these commenters
expressed concern regarding potentially
retroactive data validation requirements
whereby States would have to go back
in order to capture newly required data
elements on periods of participation
that began before the new requirements
were implemented. Several commenters
also suggested that the starting point for
data validation guidance be based on
existing data validation methods and
procedures used under WIA, with one
commenter specifically suggesting that a
comprehensive review of the data
elements currently included in WIA
data validation be undertaken to ensure
the appropriate data are being validated,
eliminating those elements that are
either duplicative or no longer
necessary.
Departments' Response: The
Departments concur that joint guidance
for conducting data validation across
the core programs is necessary in order
to provide the level of detail and
specificity required to implement these
provisions. As noted above, § 677. 240( a)
has been revised to specify that
reporting should be consistent with
guidance issued pursuant to WIOA sec.
116( d)( 5) concerning data validation.
The guidance to be developed will be
based on a comprehensive review of the
methodology, data elements, and source
documentation that have been utilized
under WIA. It will clarify State and
local roles in annual reporting and the
associated validation process, and the
co -enrollment of participants across two
or more core programs will be
addressed. The Departments do not
expect to issue guidance that includes
the need for retroactive data collection.
In terms of implementation timeframes,
the Departments anticipate a phased -in
approach, which is particularly
important for those programs that have
not conducted data validation under
WIA. Expectations will be articulated
through the Departments' joint policy
guidance, and technical assistance will
be provided to ensure consistency in
understanding and implementation. No
change to the regulatory text has been
made in response to these comments.
Comments: Commenters shared
specific suggestions for source
documentation to be used to validate
personal identity, with one commenter
arguing that applicant and counselor
statements should be acceptable for SSN
validation to eliminate the need to copy
social security cards, thereby
minimizing the risk of file breach.
Another commenter requested
clarification on accuracy standards,
inquiring as to whether the Departments
will follow the " five percent rule" used
for WIA data validation.
Departments' Response: Source
documentation requirements will be
clarified in policy guidance to be issued
jointly by the Departments, including
documentation to validate personal
identity. The Departments agree with
one commenter who suggested that
allowing staff verification is not
consistent with data quality standards.
The Departments acknowledge the
proposed suggestions by commenters
and will further clarify such procedures
through the guidelines. No change to the
regulatory text was made in response to
these comments.
The " five percent rule" referenced in
the comment pertains to an accuracy
standard utilized under WIA by DOL for
its programs whereby critical data
elements with an error rate exceeding
five percent were flagged as potentially
symptomatic of larger reporting and
data quality issues. This will be
addressed in guidance.
In addition to the regulatory text
changes discussed above, various non -
substantive changes have been made for
purposes of correcting typographical
errors and improving clarity that have
not been necessary to note elsewhere.
C. Description of the One -Stop System
Under Title I of the Workforce
Innovation and Opportunity Act (20
CFR Part 678; 34 CFR Part 361, Subpart
F; 34 CFR Part 463, Subpart J)
1. Introduction
In the section -by -section discussions
of each one-stop system provision
below, the heading references the DOL
CFR part and section number. However,
ED has identical provisions at 34 CFR
part 361, subpart F ( under its State VR
program regulations) and at 34 CFR part
463, subpart J ( under a new CFR part for
AEFLA regulations). For purposes of
brevity, the section -by -section
discussions for each Department' s
provisions appear only once— in
conjunction with the DOL section
number—and constitute the
Departments' collective explanation and
rationale for each provision. When the
regulations are published in the CFR,
these joint one-stop regulations will
55875Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
appear in each of the CFR parts
identified above.
2. General Description of the One -Stop
Delivery System ( 20 CFR Part 678,
Subpart A; 34 CFR 361. 300 Through
361. 320; 34 CFR 463. 300 Through
463. 320)
WIOA reaffirms the role of the one-
stop delivery system, a cornerstone of
the public workforce development
system, and subpart A describes the
one-stop delivery system. Although
there are many similarities to the system
established under WIA, there are also
significant changes under WIOA. This
subpart, therefore, restates WIA
requirements governing one-stop
centers, to the extent they are still
applicable under WIOA, and embodies
a set of reforms that, when implemented
effectively, are intended to make
significant improvements to the public
workforce delivery system. These
regulations set forth requirements of the
one-stop delivery system as established
under WIOA, requiring partners to
collaborate to support a seamless
customer -focused service delivery
network. The regulations require that
programs and providers colocate,
coordinate, and integrate activities and
information, so that the system as a
whole is cohesive and accessible for
individuals and employers alike. These
regulations provide a detailed
framework for implementation;
however, the Departments acknowledge
additional written guidance and
technical assistance to the public
workforce system is needed to
implement the provisions and
intentions of WIOA fully. Such
guidance and technical assistance was
provided during PY 2015 and will
continue to be provided and updated
with the future development of policies
regarding the one-stop delivery system.
The ultimate goal is to increase the long-
term employment outcomes for
individuals seeking services, especially
those with significant barriers to
employment, and to improve services to
employers.
Subpart A describes the one-stop
delivery system. It establishes the
different types of one-stop centers
allowable in each local area, the need
for both physical and programmatic
accessibility in the one-stop delivery
system, and also addresses the use of
technology to provide services through
the one-stop delivery system. As
discussed in §§678.305 and 678.310, a
local area' s one-stop delivery system
may be made up of a combination of a
comprehensive one-stop center and a
network of affiliated sites. When
designing the one-stop delivery system,
States and Local WDBs must ensure that
information on the availability of career
services is available at all one-stop
center physical locations and access
points, including electronic access
points, regardless of where individuals
initially enter the local one-stop
delivery system. The Departments
acknowledge that some comments of
support were included among
comments in this subpart. No changes to
the regulatory text were made in
response to these comments.
The Departments made several
changes to regulatory text in response to
comments on subpart A. Most notably,
changes were made to § 678. 305( d) that
clarify what it means to make available
a " direct linkage" through technology to
provide access to program services and
information for those partner programs
not physically located in a
comprehensive one-stop center.
Section 678. 300 What is the one-stop
delivery system?
This section provides that there are
responsibilities at the local, State, and
Federal levels relative to the
establishment and maintenance of the
one-stop delivery system.
Comments: Several commenters
addressed the accessibility provisions in
this subpart. A few commenters stated
that VR agencies must work closely with
workforce systems to ensure
accessibility for individuals with
disabilities. Another commenter said
that each local area must have at least
one comprehensive one-stop center that
is accessible. A few commenters said
that there are one-stop centers located in
buildings that are not fully accessible,
and the regulations should emphasize in
this section that full accessibility is
required.
Departments' Response: The
Departments agree with commenters
that accessibility to one-stop centers and
the program and services provided at
those centers is of the utmost
importance. Section 188 of WIOA, the
corresponding regulations at 29 CFR
part 38, and the regulations in this part
at §§ 678. 305, 678. 310, and 678. 800
require that all one-stop centers and
affiliated sites be physically and
programmatically accessible to disabled
individuals. The Departments have
concluded that the numerous instances
of directly addressing this or cross-
referencing another section of regulation
or WIOA throughout part 678 is
sufficient emphasis on this point. No
change to the regulatory text was made
in response to these comments.
Comments: One commenter asked
which entity is responsible for ensuring
one-stop center accessibility.
Departments' Response: The decision
as to which entity will be responsible
for ensuring accessibility at a one-stop
center is ultimately the Local WDB' s to
make, appropriately specified in the
MOU.
Comments: Another commenter said
this subpart should describe the
procedure for when a one-stop center is
found not to be physically and
programmatically accessible.
Departments' Response: The
procedures that must be followed when
a one-stop center is found not to be
physically or programmatically
accessible are described in 29 CFR part
38. The Departments have added cross
references to those regulations in
678. 305 and 678. 310 to clarify that
these are the controlling regulations in
such instances, replacing references to
678. 800.
Comments: A commenter asked, given
the long-standing separation between
one-stop centers and adult education
programs, how soon the Departments
expect these entities to fulfill the
requirement to provide a " seamless
customer -facing service delivery
network."
Departments' Response: While the
Departments understand that adapting
to the new one-stop delivery system
structure will take time for all partners
involved, partner programs are expected
to work as expeditiously as possible to
reach the goal of providing a " seamless
customer -facing service delivery
network."
Comments: A few commenters
requested guidance on how certain
partners, like libraries, are expected to
measure enrollment.
Departments' Response: A WIOA
program carries the responsibility for
reporting and ensuring such data are
available to fulfill their reporting
requirements. In the case where a
partner program is receiving WIOA
funds to provide services for any
program, a mechanism for tracking and
reporting such services and individuals
will need to be established between the
local one-stop partner and the program
responsible for making such reports.
Where a local one-stop partner is
providing services beyond those funded
under WIOA, reporting requirements
would not extend to such services. In
the case of a local one-stop partner, such
as a local library, who may only be
providing space for a program or
programs to operate within, or
providing access to public computers by
which participants access programs,
reporting is the responsibility of the
program operator.
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Comments: A few commenters said
that this section will require the UI
program to change its business model.
Departments' Response: The
Departments do not agree that the UI
program will require a change to its
business model, and see the program as
completely adaptable to the new
regulations' plan and vision for the one-
stop delivery system. New
requirements, such as the requirement
to provide " meaningful assistance" to
claimants who need help filing a claim,
do not translate into a move away from
primarily on-line or phone claims filing.
They simply assure that claimants who
need assistance accessing the program
receive it.
Section 678. 305 What is a
comprehensive one-stop center and
what must be provided there?
Access and Direct Linkage
Providing one-stop center participants
with access to program activities and
services is the keystone of the one-stop
delivery system. " Access" is defined in
678. 305( d), which provides three ways
each partner program may meet this
requirement: (1) Having a program staff
member physically present at the one-
stop center; ( 2) having a staff member
from a different partner program
physically present at the one-stop center
appropriately trained to provide
information to customers about the
programs, services, and activities
available through partner programs; or
3) making available a direct linkage
through technology to program staff
who can provide meaningful
information or services. Options two
and three offer a wide range of
possibilities to partners. Option two
could require varying levels of
assistance depending on the program' s
needs, but this could be as simple as
providing a hardcopy TANF benefit
application to a participant or directing
them to an online form. Direct linkage
can take many forms as well, and the
Departments received many comments
on the definition of this term, as
discussed below.
Comments: A few commenters
disagreed with the definition of " direct
linkage," specifically because it does
not include providing a phone number
or Web site that individuals can use at
home. These commenters said this is an
unnecessary restraint on how States can
serve customers and does not take into
account the usage of mobile apps and
other technology. The commenters also
said that the definition of " direct
linkage" exceeds what is required in
WIOA. Further, the commenters stated
that proposed technologies, such as live
Web chat systems, are expensive.
Departments' Response: Maintaining
the option of connecting to a well-
trained program staff member at the
one-stop center is extremely important
to the success of the one-stop delivery
system. The Departments recognize that
the language defining " access" and
direct linkage" may have been too
restrictive and also could make it appear
that every interaction required a human
component, not just the availability of
the option to speak with a person. Many
one-stop customers may only require
services provided electronically or may
not be ready for a direct interaction with
a staff member. For these reasons, the
Departments have changed the
regulatory text in paragraph (d)( 3) of
this section, replacing " providing direct
linkage . . ." with " making available a
direct linkage . ," in order to reflect
that communicating with an individual
must remain an option, but is not
required for every one-stop customer
interaction.
Comments: Several of the previously
mentioned commenters joined other
commenters who said that it is not
realistic to expect that every customer
can receive services at the time of
arrival at the one-stop center, and
suggested that the regulation should not
prohibit arranging for customers to
receive services at a later time.
Departments' Response: The
Departments agree that the proposed
regulation was not intended to prohibit
arrangements to serve customers at a
later time. Accordingly, the
Departments have deleted the language
prohibiting arranging for customers to
receive services at a later time, thereby
providing what the Departments see as
more flexible service delivery options.
Specifically, paragraph (d)( 2) was
changed by striking the phrase " or
making arrangements for the customer
to receive services at a later time or on
a different day."
Comments: A few commenters
commented that the definition of " direct
linkage" implies that all customers
entering a one-stop center have a
computer with Internet access at home.
The commenters recommended revising
this section to indicate that providing a
computer with access to enrollment or
eligibility services does qualify as a
direct linkage.
Departments' Response: While
providing such a service is of value and
should be encouraged, a " direct
linkage," pursuant to these final
regulations, must be the availability of
a direct connection to a program staff
member by phone or through real-time
Web -based communication, an element
seen by the Departments as critical to
the service. As mentioned above,
however, not all one-stop customer
interactions require the use of a " direct
linkage;" rather, the regulations require
only that a " direct linkage" remains
available to the customer. The language
of paragraph (d)( 2) was changed from
a] ` direct linkage' does not include
providing a phone number or computer
Web site that can be used at an
individual' s home . . ." to "[ a] ` direct
linkage' cannot exclusively be providing
a phone number or computer Web site
This means that providing a
phone number or Web site, as
mentioned by the commenters, would
still be considered serving an
individual, as long as more involved
access was available to that customer if
desired.
Comments: Another commenter also
disagreed with the NPRM, saying that
States should have flexibility to
determine how and when to deliver
virtual services.
Departments' Response: The
Departments have concluded that, with
the above-mentioned changes to the
definitions of " accessibility" and
direct linkage," States and local areas
are provided a reasonable amount of
flexibility to determine how and when
to deliver virtual services, as long as the
option of a " direct linkage" remains
open to customers if another form of
access" is not available. The
Departments have not made further
changes to the regulatory text in
response to this comment.
Comments: A few commenters
requested clarification on the definition
of " timely manner" and " within a
reasonable time."
Departments' Response: The
Departments decline to define " within a
reasonable time" in this section. The
Departments consider what is
reasonable" will fluctuate based on
demand and resources in a specific local
area. However, to ensure quality
customer service, the Departments
encourage States and local areas to
minimize the time during which an
individual must await a direct linkage to
services and to coordinate direct
services effectively.
One -Stop Center Partner Staffing
Comments: A commenter asked
whether the title I program staff person
needs to be present full-time or may be
present on a part-time basis. Another
commenter asked whether there must
also be at least a part-time title II staff
presence. Additionally, one commenter
said that electronic linkage should be
permissible instead of requiring a
physical staff presence.
55877Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
Departments' Response: At least one
title I staff person must be present when
the one-stop center is open for
operations, although this requirement
does not have to be met by a full-time
staff person and can be met by the
physical presence of different staff
trading off throughout the one-stop
center' s times of operation.
No such requirement exists for the
physical presence of a title II staff
person at the one-stop center. However,
such physical presence may be
appropriate as a means to provide
access to the title II program, depending
upon the particular local area' s needs.
Lastly, as long as there is a physical
presence of at least one title I program
staff member at all times of operation,
all other programs have the option to
provide " access" through a " direct
linkage" that leverages available
technologies according to the
definitions provided in this section. The
Departments, however, encourage
partners to strive for a physical presence
at one-stop centers to serve customers'
needs better.
Comments: A few commenters asked
if it is the intent of the regulations to
have all required partners colocated in
the one-stop centers.
Departments' Response: As stated in
678. 305( a), "[ a] comprehensive one-
stop center is a physical location where
job seeker and employer customers can
access the programs, services, and
activities of all required one-stop
partners." As providing services
through " direct linkage" is an allowable
form of " access," as defined in
678. 305( d), not all required partners
must be physically present at a
comprehensive one-stop center as long
as " access" to their services, programs,
and activities is provided. However, the
Departments encourage as much
physical presence of partner staff
persons that is feasible.
Comments: Another commenter said
that it will be logistically difficult to
ensure that 50 percent of required
partners are located in the one-stop
centers, particularly with regard to adult
education programs and the volume of
customers that they serve.
Departments' Response: This
comment seems to stem from a
misunderstanding of the colocation
requirements. While all required one-
stop partners must provide " access" to
their programs and activities through a
comprehensive one-stop center, at least
one title I program staff person must be
physically present. However, the
Departments encourage as much
physical presence of other one-stop
partners' program staff persons as is
feasible. States and local areas should be
aware of the requirement in § 678. 315
that, if Wagner-Peyser Act services are
provided at an affiliated site, at least one
or more other one-stop partner programs
must be located in the affiliated site,
and there must be a physical presence
of combined staff from the other
program(s) over 50 percent of the time
that the site is open.
Comments: Another commenter said
that the ability of the VR program to
participate through technology instead
of through a physical presence will
greatly expand the VR program' s
participation in the one-stop delivery
system.
Departments' Response: As stated
above, as long as this technology meets
the definition of " direct linkage" as
stated in § 678. 305( d), the VR agencies
are able to substitute this for a physical
presence at a comprehensive one-stop
center.
Comments: One commenter asked if it
is the intent of the regulations to require
NFJP grantees to be located in the same
one-stop center as other entities that
provide one-stop services. The
commenter said that colocating these
grantees would be logistically very
difficult. A couple of commenters stated
that the decision to colocate services
can be beneficial but should consider
financial viability. If it is more
beneficial to locate NFJP programs
outside of a one-stop center, these
commenters reasoned that grantees
should be given the flexibility to do so,
and commented that the grantee can
still develop a close partnership with
the one-stop delivery system without
necessarily being colocated.
Departments' Response: Because NFJP
is an entity that administers a program
authorized by title I of WIOA, sec.
121(b)( 1)( B) and § 678.400(b)( 1) require
NFJP to be a comprehensive one-stop
center partner. This does not necessarily
mean, however, that NFJP staff must be
physically present at the one-stop
center. There are multiple examples in
the regulations for providing access to a
program and its services through the
one-stop center (such as providing a
direct linkage"), as discussed in
paragraph (d) of this section. It should
be noted, however, that an NFJP staff
member placed at the local area' s
comprehensive one-stop center could
serve as the required title I staff member
when present.
Comments: Another commenter
remarked that, traditionally, there has
been a cost increase associated with
operating NFJP services in conjunction
with a one-stop delivery system that
leaves less funding available for training
programs and participant services. This
commenter said that the increase in
operating costs would be due to high
rent, assignment of personnel to other
duties in the one-stop delivery system,
and cooperative spending.
Departments' Response: The
Departments determined that while
there may be cost increases in some
areas, there may be savings in others
due to the infrastructure cost
contribution plan laid out in the local
area' s MOU in accordance with
678. 700 through 678. 755.
Comments: One commenter suggested
that one-stop centers should receive
guidance about how to calculate co -
occupancy rates so that partners are
aware if there is inadequate space to
provide colocated services.
Departments' Response: The
Departments recognize the importance
of quality facilities, including adequate
physical space, to deliver services
across one-stop partner programs.
However, the Departments do not
consider this level of detail necessary in
regulations and have not made changes
to the regulatory text in response to this
comment. The Departments encourage
the use of State and local administrative
data to guide negotiations regarding
colocation and shared infrastructure
costs.
Comments: Some commenters said
that the regulation implies that
operating one-stop centers beyond
normal business hours will lead to a
higher evaluation during the
certification process. These commenters
expressed concern about the fairness of
this practice, stating that some one-stop
centers many not be able to stay open
past normal business hours due to lease
agreements or security concerns ( e.g.,
needing to hire an additional security
guard).
Departments' Response: Providing
nontraditional hours of operation, such
as on Saturdays or after 5 p. m. on
weekdays, is seen as a critical element
in servicing difficult to reach
populations, such as low-wage, low -
skill, and other employed workers, and
homeless individuals. Therefore, this
will remain one of the required
elements to be taken into account when
evaluating the effectiveness of one-stop
centers. The Departments have revised
the regulatory text at § 678. 800( b) to
reflect that such hours should be
provided where there is such a need by
the workforce population, as identified
by the Local WDB. It should be noted
that this is only one factor to take into
consideration when evaluating a one-
stop center for certification, and while
operating a one-stop center beyond
normal business hours will count
positively toward a center' s evaluation,
this will in no way negatively affect the
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evaluations of other one-stop centers in
the State that may not be able to offer
such services.
Comments: Another commenter
asserted that the regulation' s emphasis
on expanding operating hours would
require additional staff and relocations
to larger facilities to accommodate these
staff.
Departments' Response: In some
instances, this may be true, but the
Departments encourage creative ways of
implementing these nontraditional
hours with the resources the one-stop
centers and Local WDBs have available
to them. Innovation is one of the driving
principles behind WIOA, including in
how services are delivered to difficult to
reach populations and individuals with
barriers to employment.
Other Comments
Comments: Another commenter said
that States should determine standards
for one-stop centers with input from
Local WDBs.
Departments' Response: Under sec.
101( d)( 6) of WIOA, State WDBs are
responsible for assisting the Governor in
developing statewide policies affecting
the coordinated provision of services
through the one-stop delivery system,
including developing objective criteria
and procedures that Local WDBs will
use to assess the effectiveness and
continuous improvement of one-stop
centers. In addition, one-stop centers
must adhere to the requirements in sec.
121 of WIOA and these implementing
regulations.
Comments: A commenter suggested
amending this section to encourage
States to develop technology-based
strategies to ensure that wraparound, or
comprehensive, services are available
outside of normal business hours.
Departments' Response: The
Departments encourage the
development of technology-based
strategies to deliver services to
customers in innovative and
comprehensive ways, both during
normal business hours and
nontraditional hours, and the
Departments have concluded that the
regulations support such activity as
written. No changes to the regulatory
text were made in response to this
comment.
Comments: Another commenter said
that the NPRM does not provide enough
guidance on how to decide the number
and location of comprehensive one-stop
centers, explaining that these decisions
require significant collaboration among
several stakeholders.
Departments' Response: While sec.
121( e) of WIOA and § 678. 300( c) require
that at least one comprehensive one-
stop center be established in a local
area, many local areas will require the
establishment of multiple centers to
serve their populations properly. This is
highly dependent on individualized
factors in each local area. This
determination is best carried out at the
State and local planning level. WIOA
sec. 121( a) requires the establishment of
the one-stop delivery system, consistent
with the approved Unified or Combined
State Plan, through the Local WDB for
a local area and with the agreement of
CEO for the local area. It is these entities
that should determine the proper
number and location of one-stop
centers, by drawing on their knowledge
of the area' s needs. The Departments
made no change to the regulatory text in
response to the comment.
Section 678. 310 What is an affiliated
site and what must be provided there?
In addition to the requirement for a
physical center in each local area where
all required one-stop partners must
provide access to their programs,
services and activities, consistent with
sec. 121( e)( 2)( B) of WIOA㤤 678. 310
and 678. 320 provide that the one-stop
delivery system may also provide
partner programs, services, and
activities through affiliated sites or
through a network of eligible one-stop
partners that provide at least one or
more of the programs, services, and
activities at a physical location or
through an electronically or
technologically linked access point,
such as a library. The Departments
added a reference to 29 CFR part 38, the
implementing regulations of WIOA sec.
188.
Comments: A commenter
recommended that affiliated sites not he
required to have operators; however, the
commenter also said that the entities
delivering services at these sites should
be signatories to the MOU.
Departments' Response: As required
by sec. 121( c) of WIOA, an MOU is an
agreement among the one-stop partner
programs and the Local WDB; therefore,
the entities delivering services—i.e., the
partner programs—will be signatories to
the MOU. A local area' s one-stop
operator may be in charge of running
affiliated sites as well as the
comprehensive one-stop center. In other
cases, other arrangements for operations
of the affiliate sites may be specified in
the MOU. The operator may be assigned
different responsibilities, which are
dependent on the terms of the selection
process and the operator agreement( s)
reached between the operator(s) and the
Local WDB.
Comments: One commenter suggested
that affiliated sites should not have to
provide access to all required partners,
since physical staffing is determined
locally.
Departments' Response: Since
affiliated sites are not required to
provide access to all partner programs,
as stated in § 678. 310( a), no change to
the regulatory text is necessary.
Comments: Another commenter asked
whether VR agencies are required to
participate in affiliated sites.
Departments' Response: To clarify,
neither the VR program, nor any other
partner program, is required to
participate in affiliated sites by these
regulations or by statute; partner
programs are required only to
participate in the operation of the one-
stop delivery system and must provide
access to their programs through the
comprehensive one-stop centers. The
Departments encourage the use of
affiliated sites to serve a local area' s
population better, but decisions
concerning this implementation are
ultimately made by the local areas.
These affiliated sites should, first and
foremost, supplement and enhance
customer access to services, and should
be seen as access points that are in
addition to the local area' s
comprehensive one-stop centers.
Comments: One commenter asked
whether an adult education provider in
a CBO is considered an affiliated site.
Departments' Response: Yes, an adult
education provider, or any other partner
program, located in a CBO, may be
considered an affiliated site. If any
partner program in a CBO is considered
an affiliated site, that program must
follow all of the requirements of this
section.
Section 678.315 Can a stand-alone
Wagner-Peyser Act Employment Service
office be designated as an affiliated one-
stop site?
This section sets forth the prohibition
against standalone Wagner-Peyser Act
Employment Services offices. WIOA
requires that the Wagner-Peyser Act
Employment Service program be
colocated with one-stop centers. A
Wagner-Peyser Act Employment Service
office cannot, by itself, constitute an
affiliated site. In those cases where the
Wagner-Peyser Act Employment Service
program is located in an affiliated site,
there must be staff of at least one other
partner in that affiliated site that is
physically present more than 50 percent
of the time the center is open.
Comments: A commenter asked
whether one partner agency that
administers multiple partner programs
can satisfy the 50 percent presence
requirement. This commenter reasoned
that multiple partners should be able to
55879Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
meet the 50 percent requirement
collectively.
Departments' Response: In light of the
comments and upon considering the
requirement for physical presence of
non -Wagner Peyser program staff more
than 50 percent of the time, the
Departments have concluded that it is
appropriate to allow a combination of
partner program staff members to meet
this requirement, and the Departments
have revised the regulatory text to
reflect this.
If there is only one qualifying partner
program (i.e., partner programs other
than local veterans' employment
representatives, disabled veterans'
outreach program specialists, or UC
programs) in addition to the Wagner-
Peyser Act program at an affiliated site,
then that partner program alone must
meet the more than 50 percent
threshold. If there is more than one
qualifying partner program in the
affiliated site, such programs together
must have staff present to provide
coverage more than 50 percent of the
time the site is open.
Comments: A commenter also
recommended that electronic access
should be included to meet the more
than 50 percent requirement. Another
commenter agreed, and also added that
it may not be financially feasible to have
staff in affiliated sites more than 50
percent of the time.
Departments' Response: While the
Departments appreciate and encourage
partners' use of technology to better,
and more comprehensively, serve
customers of the one-stop delivery
system, the Departments have not
revised the regulatory text to permit
such activities in order to meet the more
than 50 percent physical presence
requirement for non-Wagner-Peyser Act
partner programs. Doing so would
defeat the purpose of this requirement,
which is to have staff other than
Wagner-Peyser Act staff physically
present for a majority of the time that an
affiliated site is open.
Comments: A few commenters
requested flexibility in determining
staffing at affiliated sites to meet local
needs best, stating that the 50 percent
threshold may result in some programs
being overstaffed while Wagner-Peyser
Act services are understaffed. Another
commenter agreed that this requirement
is burdensome and does not take into
account existing long-term lease
agreements.
Departments' Response: In
determining the number and placement
of affiliated sites, Local WDBs should
consider how their one-stop delivery
system could deliver services most
effectively across the local area with the
resources that are available. In making
these adjustments, Local WDBs should
consider the services that are needed in
each location, how services are
delivered in the comprehensive one-
stop center, where the one-stop center is
located, and where current affiliated
sites are located. This may require the
opening of new affiliated sites, or the
consolidation of existing offices that
would he considered affiliated sites
under WIOA. The Departments
recognize that such adjustments take
time, but the Departments expect this
process to begin as soon as possible.
Comments: Another commenter asked
how this requirement would affect
existing standalone Wagner-Peyser Act
offices.
Departments' Response: This
requirement will mean that either a non-
Wagner-Peyser Act partner program will
need to colocate at the formerly
standalone Wagner-Peyser Act office;
the Wagner-Peyser Act program will
need to move to another space that can
support colocation with a non-Wagner-
Peyser Act partner program; or the
Wagner-Peyser Act program will need to
shift operations to a comprehensive one-
stop center, of which the program is a
required member, or to another
affiliated site. As stated in § 678. 315,
Wagner-Peyser Act programs may no
longer exist in standalone offices.
Comments: One commenter
recommended strengthening the
language about how required partners
are to operate in integrated partnerships
with Wagner-Peyser Act services. The
commenter stated that many local areas
have flexibility to determine whether to
colocate with Wagner-Peyser Act
services.
Departments' Response: The
Departments are not altering the
regulatory text to address the language
concerning how required partners are to
operate in partnership with Wagner-
Peyser Act services. WIOA recognizes
the Wagner-Peyser Act program' s role in
the one-stop delivery system and has
made Wagner-Peyser Act one of the core
programs. The Departments have
determined that Wagner-Peyser Act
services are vital to the successful
operation of one-stop centers, and have,
through administrative guidance,
strongly encouraged access to these
services throughout the public
workforce system.
Comments: A few commenters
expressed concern about the lack of
specific instructions for how State
workforce agencies are supposed to
fund the colocation of Wagner-Peyser
Act services. The commenters
recommended that States do not need to
use their Wagner-Peyser Act program
allocations for this action.
Departments' Response: Given the
diversity in how States have structured
their Wagner-Peyser Act employment
services, the regulation provides States
with discretion in developing an
appropriate plan for relocation. Any
plan, including the identification of
funding to be used to carry out
relocation, must comply with applicable
Federal cost principles. The
Departments did not make changes to
the regulatory text in response to this
comment.
Comments: One commenter
recommended that States be required to
have a conflict -resolution process in
place for on-site staff disputes, which
may help alleviate one of the major
challenges of program colocation.
Departments' Response: While the
Departments recognize the utility of
such a process and may recommend the
implementation of such a process in
many instances, the Departments have
decided it is best to provide Local WDBs
with flexibility in determining how to
operationalize the colocation of
programs, as well as integrated service
delivery. For this reason, the
Departments will not require a conflict -
resolution process for on-site staff
disputes, and have made no changes to
the regulatory text.
Section 678. 320 Are there any
requirements for networks of eligible
one-stop partners or specialized centers?
The Departments received no
comments for this section and made no
substantive changes to the regulatory
text. However, the Departments have
rephrased the first sentence of the
paragraph to improve clarity and
readability. The phrase " such as having
in place processes to make referrals to"
was stricken from its original position;
one-stop center" was added after
comprehensive;" and the phrase " for
example, by having processes in place
to make referrals to these centers and
the partner programs located in them"
was inserted at the end of the first
sentence. The new sentence reads as
follows: " Any network of one-stop
partner or specialized centers must be
connected to the comprehensive one-
stop center and any appropriate affiliate
one-stop centers, for example, by having
processes in place to make referrals to
these centers and the partner programs
located in them." The Departments have
made these changes to make this
sentence more understandable than
originally phrased and do not intend to
change the meaning of the sentence or
paragraph.
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3. One -Stop Partners and the
Responsibilities of Partners ( 20 CFR Part
678, Subpart B; 34 CFR 361. 400
Through 361. 440; 34 CFR 463. 400
Through 463. 440)
The public workforce system
envisioned by WIOA seeks to provide
all participants with access to high-
quality one-stop centers that connect
them with the full range of services
available in their communities, whether
they are looking to find jobs, build
educational or occupational skills, earn
a postsecondary certificate or degree,
obtain guidance on how to chart careers,
or are employers seeking skilled
workers. A genuinely seamless, one-stop
experience requires strong partnerships
across programs that are able to
streamline service delivery and align
program requirements. In this subpart of
the regulation, the Departments describe
requirements relating to such one-stop
partnerships. Specifically, this subpart
identifies the programs that are required
partners and their roles and
responsibilities, the other entities that
may serve as partners, and the types of
services provided.
The Departments changed several
sections of this subpart in response to
comments. While small changes to the
regulatory text were made in § 678. 410,
much more significant changes were
made to § 678. 415( e), which changed
the default one-stop partner under the
Perkins Act from the State agency
administering that program to a local
postsecondary recipient of Perkins
funds. Changes to the requirements for
local TANF partners have also been
made in § 678.430(a)(2) and (d). Two
additions were also made to the human
services that may be provided as
business services in § 678.435(b)(4).
Section 678. 400 Who are the required
one-stop partners?
This section lists the one-stop
partners required under sec. 121( b)( 1)( B)
of WIOA. Beyond the partners
previously required under WIA, WIOA
adds the TANF program, administered
by HHS, and the Ex -Offender program,
administered by DOL under sec. 212 of
the Second Chance Act of 2007, to the
list of required partners.
Comments: A commenter requested
clarification on participation for career
and technical education programs and
also a clearer definition of employment
and training programs. The commenter
expressed concern that without a clear
definition of these terms, nearly any
entity can claim to be an employment
and training program. Further, the
commenter requested that States be able
to define these terms.
Departments' Response: Within the
context of these regulations, these terms
are used in reference to programs
authorized under specific Federal
statutes. The " career and technical
education programs" referred to in
678.400(b)( 6) are those authorized by
the Perkins Act at the postsecondary
level. The " employment and training
activities" listed in this section are
either those carried out under the CSBG
or those carried out by HUD, as
provided in § 678.400(b)(9) and (10),
respectively. Under these categorical
restrictions, the Departments are not
concerned that nearly any entity could
claim to be an employment and training
program. Section 121( b)( 1)( B) of WIOA,
as implemented by § 678.400, lists
intentionally broad categories of
required partners so as to bring more
local partner programs into the
comprehensive one-stop center and the
broader one-stop delivery system to
provide more comprehensive services
for the one-stop centers' customers. For
this reason, the Departments are not
changing the regulatory text concerning
these terms. The Departments have
determined that it is within the best
interests of the one-stop delivery system
and its customers for States to adhere to
these broad categorical definitions.
Furthermore, narrowing these
definitions would exclude some
programs explicitly included by
Congress as the regulatory language
mirrors the statutory text in WIOA secs.
121( b)( 1)( B)( vi), (ix), and (x).
Comments: A commenter asked
whether CSBG programs have to be
physically located at the one-stop
center.
Departments' Response: If a CSBG
program carries out employment and
training activities, then these activities
must be accessible at the comprehensive
one-stop center, either through a
physical presence or through another
means of " access" as defined by the
regulations in § 678. 305( d), because
these programs are required one-stop
partners under sec. 121( b)( 1)( B) of
WIOA. Section 678. 305( c) specifically
requires customers to have access to
one-stop partner programs in a
comprehensive one-stop center,
including employment and training
activities carried out under the CSBG
program. Furthermore, § 678. 305( d)
defines " access" as including, but not
limited to, having partner program staff
physically present at the one-stop
center. That is, one-stop partner
programs do not need to be physically
present in a comprehensive one-stop
center, but they must provide access to
their services in the ways described in
678. 305( d).
Comments: One commenter said that
the Perkins program needs to determine
who the Perkins one-stop partner will
he. Another commenter stated that
678.400 needs to be reconciled with
the Perkins Act and asserted that career
and technical education programs do
not have authority to enter into an
MOU, although a postsecondary entity
does have such authority.
Departments' Response: The NPRM
specified that the State Eligible Agency
serves as the one-stop partner for the
Perkins program. As discussed below in
this preamble, the Departments have
determined that an eligible recipient at
the postsecondary level, or a consortium
of eligible recipients at the
postsecondary level in the local area is
the most appropriate entity to serve as
the one-stop partner in a local area. This
change is reflected in § 678.415( e) and is
discussed in the corresponding
preamble section below.
Comments: Another commenter
recommended that all Federal grantees
that have employment and training
components in their grant should be
required one-stop partners.
Departments' Response: While the
Departments encourage the inclusion of
such entities as additional one-stop
partners, the list of required partners in
678. 400( b) is the statutorily mandated
list of required partners. The
Departments do not have authority to
require additional programs to be one-
stop partners. However, several entities
such as those mentioned by the
commenter are explicitly listed in sec.
121(b)( 2)( B) of WIOA and § 678.410 as
acceptable additional one-stop partners,
subject to approval of the Local WDB
and CEO.
Section 678. 405 Is temporary
assistance for needy families a required
one-stop partner?
This section provides further
clarification that the Governor may
determine that TANF will not be a
required one-stop partner in a local
area( s), but must notify the Secretaries
of Labor and HHS in writing of this
determination. This implements sec.
121( b)( 1)( C) of WIOA. It should be noted
that the Governor' s decision to exclude
TANF from being a required one-stop
partner is distinct and separate from the
decision to include or not to include
TANF in a Combined State Plan. TANF
remains one of the many options of
programs to be included in a Combined
State Plan. Its status as a required one-
stop partner does not mean it is required
to be included in a Combined State
Plan. For all sections regarding TANF,
the HHS, which administers the
program, was consulted extensively.
55881Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
Comments: A few commenters
expressed support for TANF being a
required one-stop partner. Other
commenters remarked that adding
TANF as a one-stop partner will lead to
improved services for job seekers.
However, one commenter recommended
that the Departments include stronger
language about including TANF as a
required one-stop partner. This
commenter said that if TANF is such an
important partner, it should not be so
easy for Governors to opt out.
Departments' Response: While the
Departments agree that TANF is an
important partner in the one-stop
delivery system, WIOA requires— at sec.
121( b)( 1)( C)— that Governors be able to
determine that TANF will not be a
required one-stop partner through
written notice to both the Secretary of
Labor and the Secretary of HHS. It
should be noted, however, that even if
the Governor decides not to require
TANF to be a one-stop partner, local
TANF programs may still work in
collaboration or partnership with the
local one-stop centers to deliver
employment and training services to the
TANF population, unless inconsistent
with the Governor' s direction.
Additionally, the local TANF program
also may find other avenues of
providing TANF services to one-stop
customers that may not reach " partner"
status.
Comments: One commenter
recommended that the regulations
should clarify that TANF employment
and training activities must be offered at
one-stop centers, with other TANF-
funded activities included at the
discretion of the local TANF agency and
Local WDB. This commenter reasoned
that requiring all TANF activities at one-
stop centers would be a substantial cost
and administrative burden.
Departments' Response: Access
through the one-stop delivery system is
required only for TANF activities
related to work, education or training,
the initiation of an application, and
career services as specified in
678.430( a)( 2). TANF is a required one-
stop partner unless the Governor opts
not to require TANF participation in
either a specific local area or the entire
State. The cost of the various activities
associated with the one-stop operators
should be one of the factors considered
by the Governor in making this
decision.
Comments: A commenter stated that
even if the Governor opts out, local
TANF programs might still be required
to be one-stop partners. Other
commenters expressed support for local
TANF programs to be permitted to opt
in as one-stop partners, even if the
Governor opts out. Another commenter
expressed concern that the proposed
regulations would permit a local TANF
agency official to defy a Governor' s
decision not to include TANF as a
required one-stop partner. The
commenter recommended that this
clause should be deleted, stating that a
Governor' s decision regarding TANF as
a required one-stop partner must be
respected.
Departments' Response: While local
TANF programs are allowed to be one-
stop partners, they cannot be required to
do so if the Governor has determined
that TANF is not required to be a
partner. However, the Departments
agree that local TANF programs should
be permitted to work in collaboration
and partnership with the local one-stop
centers and have determined that
allowing local TANF programs to make
this decision, in conjunction with Local
WDBs, is in the best interest of serving
one-stop customers to the fullest extent
possible, unless doing so is inconsistent
with the Governor' s direction. The
Departments recognize the importance
of increasing access to TANF programs,
and have determined that allowing
these programs' voluntary inclusion,
when not required by a Governor and
when not prohibited by the Governor' s
direction, is consistent with the spirit of
WIOA. The Departments have modified
the regulatory text to indicate that local
TANF programs may become partners at
the local one-stop centers unless the
Governor directs or orders otherwise.
While a Governor may choose not to
require TANF programs to be one-stop
partners, the Departments do not want
to create barriers to local TANF
programs becoming partners in the local
one-stop center when there is a mutual
desire to do so. The Departments have
concluded that the availability of TANF
services to one-stop customers is an
important element of the one-stop
vision. Furthermore, the Departments
have interpreted WIOA sec. 121( b) as
providing separate authority to local
areas to include additional one-stop
partners, including TANF, which is not
overridden by a Governor electing to
exclude TANF from being a required
partner. However, as administrator of
the State TANF program, the Governor
is empowered under the Social Security
Administration (SSA) to direct the
actions of local TANF programs and
may choose to limit a local program' s
ability to opt in. It should be noted here
that any additional partners not
required by sec. 121(b)( 1)( B) of WIOA,
but permitted by sec. 121( b)( 2)( B), can
participate as a one-stop partner only
with the agreement of the CEO and
Local WDB.
Comments: A commenter urged the
Departments to ensure that a decision
regarding whether TANF is a required
one-stop partner should be separate
from the decision regarding including
TANF in a Combined State Plan.
Departments' Response: The
Governor' s decision to exclude TANF as
a required one-stop partner must be
made through direct written notification
of such a decision from the State' s
Governor to the Secretaries of Labor and
HHS. By contrast, at any time, a
Governor can opt to include or not
include TANF in a Combined State
Plan, whether or not TANF is a required
one-stop partner in the State.
Comments: Another commenter asked
how TANF being a required partner
instead of a core partner translates into
level of service delivery for clients.
Departments' Response: The
regulations do not differentiate between
core programs and required one-stop
partners with respect to level of service
delivery. All required one-stop partners
are expected to provide comparable
levels of service delivery to one-stop
customers, regardless of whether they
are core programs under WIOA. No
changes to the regulatory text were
made in response to this comment.
Comments: One commenter stated
that this is an opportunity for the TANF
program to partner with schools.
Departments' Response: While the
TANF program' s inclusion in a State' s
one-stop delivery system may, in fact,
provide an opportunity for TANF
programs to partner with schools, this is
a decision that should he made at the
local level and will not be required by
the Departments. As such, no changes to
the regulatory text were made in
response to this comment.
Section 678. 410 What other entities
may serve as one-stop partners?
Partnerships across programs are
critical to supporting the one-stop
vision for service delivery. Section
678. 410 reinforces sec. 121( b)( 2)( B)( vii)
of WIOA, which states that other
Federal, State, local, or private sector
entities that carry out workforce
development programs may serve as
additional one-stop partners if the Local
WDB and CEOs approve.
Comments: A few commenters
recommended that the regulations
should strongly encourage partnerships
with disability service providers, as
increasing the employment of persons
with disabilities is a key goal of WIOA.
Another commenter stated that SNAP
employment and training programs
would include the Basic Food
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Employment and Training (BFET) and
Able -Bodied Adults Without
Dependents (ABAWD) programs. The
commenter also asked whether
678.410(b)(6) includes programs
funded by the Office of Refugee
Resettlement (ORR). Another
commenter urged one-stop centers that
have youth services to partner with
Runaway and Homeless Youth (RHY)
providers. The commenter explained
that RHY providers have best practices
for dealing with traumatized youth. One
commenter looked forward to working
with refugee English language training
organizations and other organizations as
potential one-stop partners.
Departments' Response: Each one of
the comments above suggests including
programs as one-stop center partners.
Local partners representing any one of
these programs that provides services or
serves participants who are in need of
the career development or job
placement services of the one-stop
delivery system would be appropriate
additions to the one-stop delivery
system in a given local area and could
be added as additional partners under
678. 410( b)( 6). Inclusion in the one-
stop center of these and other programs
is outlined in the local area strategic
plan, and in the specifications for the
selection of one-stop operators and
service providers in the local areas. In
response to these and other comments,
which are addressed below, wording
has been added to this section to clarify
that the list of optional one-stop
partners is not exhaustive. The
Departments have determined that no
additional specific regulatory language
is needed.
Comments: A commenter
recommended that the Departments add
a reference to local or regional labor
market information, which should be
used to drive strategic planning and
one-stop partner decisions regarding the
appropriate mix of services required in
local areas.
Departments' Response: Many factors,
including labor market information, can
inform what local partners should
include in a one-stop center. The
Departments have not changed the
examples of optional one-stop partners
in the regulation, but have clarified that
the list in § 678.410 is not exhaustive,
by changing " including" to " including,
but not limited to" in the catch-all
provision of paragraph (b)( 6). It should
be noted that the term " including" is, by
definition, nonexclusive, and that this
addition is made for the sake of
emphasis and should not to be
interpreted as suggesting that any other
use of the term " including" in these or
any other regulations denotes
exclusivity. The Departments agree that
partners suggested by commenters can
be appropriate and useful one-stop
partners but have concluded that it is
easier to communicate this flexibility by
clarifying that the list is not exhaustive,
rather than trying to list every potential
partner.
Section 678.415 What entity serves as
the one-stop partner for a particular
program in the local area?
This section provides a general
definition of the entities that carry out
the programs identified in §§678.400
and 678.410 and serve as the one-stop
partners. The regulation defines an
entity as the grant recipient,
administrative entity, or other
organization responsible for
administering the funds of the specified
program in the local area. The term
entity" does not include service
providers that contract with, or are
subrecipients of, the local
administrative entity. The regulation
notes that for programs that do not have
local administrative entities, the
responsible State agency should be the
one-stop partner.
Section 678. 410( d) lists the entity that
acts as the WIOA title I one-stop partner
for national programs in any particular
local area. While YouthBuild was listed
in the NPRM as one of these national
programs, the paragraph failed to list
which entity would serve as the one-
stop partner. Just as for the Indian and
Native American and Migrant and
Seasonal Farmworker programs, the
grantee of the YouthBuild program is
the entity that will serve as the one-stop
partner in a local area. The regulatory
text has been amended to convey this
and correct the omission in the NPRM.
Comments: A commenter asserted
that proposed § 678.415( e), which
designates the Perkins State eligible
agency as the local one-stop partner for
purposes of negotiating the MOU, " lacks
any support in the text of the law and
would make an already complicated
negotiation process that much more
complex." Several commenters
recommended revising the paragraph to
state that the entity that carries out the
program is the local area' s Perkins
eligible institution, rather than the State
eligible agency. Further, this commenter
recommended that the Departments
remove the clause about the State
eligible agency delegating its
responsibilities.
Departments' Response: In response
to these comments, the Departments
agree that the local eligible recipient is
a more appropriate one-stop partner for
the Perkins program and have changed
the regulatory text in § 678. 415( e) to
provide that the Perkins one-stop
partner is the eligible recipient at the
postsecondary level, or a consortium of
eligible recipients at the postsecondary
level in the local area. This change is
aligned to the statutory text in WIOA
sec. 121( b)( 1)( B)( vi). The regulatory text
also has been revised to state that the
Perkins one-stop partner may request
assistance from the State eligible agency
in completing its responsibilities as a
one-stop partner.
Comments: A few commenters
interpreted proposed § 678. 415( c) to
mean that if the State' s VR program is
under an umbrella agency that is not
primarily concerned with vocational
rehabilitation, the designated VR
partner will be the director of the
designated State unit.
Departments' Response: Under
678. 415( c), if the designated State
agency— which these commenters refer
to as an " umbrella agency"— is not
primarily concerned with VR, then the
designated State unit for the VR
program would be the local partner.
Comments: One commenter stated
that it is unclear from this section
whether the Local WDB or its chosen
title I provider is the entity that serves
as the one-stop partner and
recommended that the Local WDB not
be considered the one-stop partner in
this case.
Departments' Response: The
Departments agree with the commenter
that the Local WDB is not a one-stop
partner, unless it is a specific program
provider as well. The Departments have
concluded that the proposed regulatory
text is clear on this issue and have made
no changes to the regulatory text.
Comments: Another commenter
agreed with the Job Corps center being
the one-stop partner, but suggested also
including the providers who conduct
recruitment for the Job Corps program.
Departments' Response:
Determination of such an inclusion in
the local one-stop delivery system is
best left to the Local WDB. These
providers will remain permissible one-
stop partners but will not be required,
and the Departments decline to change
the regulatory text in response to this
comment.
Comments: One commenter suggested
allowing the State TANF agency to
delegate its responsibilities under
678. 415( a), as other mandatory
partners are permitted to do.
Departments' Response: The
Departments' interpretation of WIOA is
that the local TANF program is the
required one-stop partner that,
therefore, holds the responsibilities
mentioned by this commenter. Matters
concerning the roles of entities in
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carrying out TANF must be addressed
under the TANF authorizing statute.
Comments: Some commenters
expressed support for not requiring the
one-stop partner to have responsibilities
in local areas where that program or
activity is not carried out.
Departments' Response: The final
regulation continues to reflect this
policy.
Section 678. 420 What are the roles and
responsibilities of the required one-stop
partners?
This section describes and elaborates
upon the statutory responsibilities of the
one-stop partners. These responsibilities
and corresponding WIOA provisions are
identified and summarized in
paragraphs (a) through (e) of §678.420.
Jointly funding services is a necessary
foundation for an integrated service
delivery system. All partner
contributions to the costs of operating
and providing services within the one-
stop delivery system must be
proportionate to the benefits received
and also must adhere to the partner
program' s Federal authorizing statute
and to Federal cost principles requiring
that costs are reasonable, necessary, and
allocable. The requirement in
678.420( e), to provide representation
on State and Local WDBs, is new in
WIOA and is required only of core
programs; WIA only required one-stop
partner representation on Local WDBs,
and required it for all one-stop partner
programs. The Departments have begun
issuing guidance and providing the
system with technical assistance on
matters related to this section and will
continue to do so.
Responsibilities Related to
Infrastructure Cost Contributions
Comments: A commenter asked
whether the statement in this section
that references Federal laws on
administrative costs refers to the
established ceilings on the
infrastructure contributions that can be
expected from certain programs, such as
VR.
Departments' Response: This is the
intent of the rule and, as such, the
Departments have made no changes to
the regulatory text in response to this
comment.
Comments: A commenter stated that
partner programs would be more likely
to contribute to infrastructure costs if
the individual programs' authorization
were amended to include that
expectation.
Departments' Response: Revisions to
the authorizing statutes and regulations
of individual programs are beyond the
scope of this regulation.
Comments: Another commenter stated
that it would be very challenging to
establish equitable funding to support a
one-stop delivery system without
stronger language and guidance
governing the required one-stop
partners.
Departments' Response: The
Departments have released, and will
continue to release, guidance relating to
this and many other issues. The
Departments concluded that the
guidance will be sufficient in assisting
one-stop partners in supporting a one-
stop delivery system and decline to
make a change to the regulatory text.
Comments: A few commenters said
that § 678.420(b) can be construed to
mean that YouthBuild programs must
contribute money to their local one-stop
delivery system. The commenters
expressed concern that YouthBuild
programs would have to pay into the
one-stop delivery system for
infrastructure support when the money
is needed to operate the program.
Departments' Response: As a
statutorily required one-stop partner
program, YouthBuild is required by sec.
121( b)( 1)( A)(ii) of WIOA to contribute to
the infrastructure costs of any one-stop
center in which it participates, based on
proportionate use and relative benefit
received. The Departments do not have
authority to change this requirement
and have made no changes to the
regulatory text in response to these
comments.
Comments: A commenter requested
additional guidance on proportional
benefits received and also on costs
associated with title II providers
contributing to one-stop infrastructure.
Departments' Response: The portion
of this preamble addressing public
comments and changes made to the
provisions in subpart E relating to " One -
Stop Operating Costs" also addresses
many of these issues.
Other Comments
A few commenters recommended
rewording this section to state that not
all one-stop partners are required to be
members of the State and Local WDBs.
Departments' Response: After
considering this comment, the
Departments have concluded that the
language of the proposed regulatory text
is clear that not all one-stop partners are
required to be members of the State and
Local WDBs. No changes to the
regulatory text were made in response to
this comment.
Comments: One commenter asked
what recourse a Local WDB would have
if States allocate the majority of their
program funding to more populous
areas, leaving rural areas underfunded.
Departments' Response: The
allocation of funds by programs is
beyond the scope of this regulation and
WIOA. As such, the Departments have
no ability or authority to create such a
recourse mechanism. As good faith
partners in the one-stop delivery
system, however, the Departments
expect that programs will operate in a
manner that best serves the needs of a
State.
Section 678. 425 What are the
applicable career services that must be
provided through the one-stop delivery
system by required one-stop partners?
WIOA requires one-stop partners to
deliver applicable program -specific
career services. This regulation clarifies
that an applicable career service is a
service identified in § 678.430 and is an
authorized program activity.
Comments: A few commenters
requested clarification on what services
must be physically available in one-stop
centers. Another commenter said that
proposed § 678.425 does not describe
how or where these services must be
provided and suggested that customers
should be able to receive in-person
assistance with the required partners.
Another commenter expressed support
for eliminating the sequence of services,
as this would provide staff with greater
flexibility to serve customers.
Departments' Response: The
Departments have not made changes to
678.425. Section 678.305(b)( 1)
specifically states that comprehensive
one-stop centers must provide career
services described in § 678.430. The
language is not qualified by the phrase
access to," meaning that career
services must actually be provided in
the comprehensive one-stop centers.
With respect to programs and activities
to which the one-stop partners must
provide access, as set forth in
678. 305(b)( 2) through (4), the
regulations describe requirements
concerning physical presence of staff
and in-person assistance in § 678. 305( a),
c), and (d). Paragraph (a) of § 678.305
requires that at least one title I staff
person be physically present in a
comprehensive one-stop center.
Paragraph (c) of §678.305 requires
customers to have access to one-stop
partner programs in a comprehensive
one-stop center, and paragraph (d)
defines " access" as including, but not
limited to, physical presence of partner
program staff appropriately trained to
provide information to customers about
the programs, services, and activities
available through partner programs.
That is, one-stop partner programs do
not need to be physically present in a
comprehensive one-stop center, but they
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must provide access to their services in
the ways described in § 678. 305( d).
Section 678. 430 What are career
services?
Unemployment Insurance Claims
Filing and Assistance. Section 678. 430
specifies the career services that one-
stop partners must provide through the
one-stop delivery system. Paragraph
a)( 10) provides that core services
include providing meaningful assistance
to individuals seeking assistance in
filing a claim for unemployment
compensation.
Comments: Several commenters
addressed the proposed definition of
meaningful assistance." In particular,
one commenter expressed support for
the definition as it allows for technology
to be used to provide the assistance.
However, this commenter joined many
others in expressing strong
disagreement with the discussion in the
preamble to the NPRM that one-stop
customers referred to a phone -based
service for UI claims be sent to a
dedicated phone line for one-stop
customers, rather than the general State
UI queue. These commenters asserted
that this requirement is not in WIOA;
would be costly and difficult to
maintain during times of high call
volume; fails to take advantage of
existing UI claims filing and assistance
technology infrastructure in many
States; and gives priority to individuals
who are able to travel to one-stop
centers, thereby disproportionately
affecting individuals who are unable to
travel to one-stop centers due to
distance, lack of transportation options,
or disability. A few commenters also
stated that this requirement conflicts
with the fact that most UI claims are
done remotely through self-service
options, including mobile applications
and Web sites. One commenter asked
for the definition of "within a
reasonable time." Another commenter
said that the definition of "meaningful
assistance" is not clear.
Departments' Response: The
Departments disagree with the
comments regarding a dedicated phone
line for one-stop customers using UI
services. States are not required to have
a dedicated phone line for one-stop
customers, but a phone line would
provide a direct linkage for providing
services remotely as required by
678. 305( d). More importantly, simply
referring one-stop customers to the
general UI queue, without otherwise
making trained staff available does not
qualify as " meaningful assistance."
Therefore, if local areas choose to
provide meaningful assistance through
technological means, trained staff must
be available such as through a dedicated
phone line.
In response to the comments
regarding concerns that the " meaningful
assistance" requirement to help
individuals file UI claims is overly
burdensome, the Departments note that
678. 430( a)( 10)( i) provides flexibility to
States regarding implementation by
providing a menu of options for States
to meet the requirement. The regulation
does not mandate the service delivery
methodology. Options include the
ability to provide the service remotely
as long as it is provided by trained and
available staff within a reasonable time.
The Departments also note that this
requirement is targeted to individuals
who need assistance and is not intended
to replace State processes for taking
claims remotely, either online or by
phone. The Departments have not
provided a definition of reasonable time
because that varies by circumstances.
The Departments have made no changes
to the regulatory text in response to
these comments.
Comments: Many commenters raised
concerns about private entities or
contractors providing assistance with
filing UI claims, asserting that this
should be considered an inherently
governmental function that must be
conducted by State merit staff. These
commenters said that if UI staff is not
present in one -stops to fulfill this
function, Employment Services staff
could do so. A few commenters also
recommended that " State merit" be
inserted before " staff" in proposed
678. 430( a)( 10)( i)(A) and (B). A
commenter expressed concern regarding
the definition of " filing," suggesting that
it should not be the function of one-stop
or Wagner-Peyser Act staff to file UI
applications.
Another commenter asked for
guidance on defining " and assistance"
in the requirement to provide
information and assistance regarding
filing claims for unemployment
compensation." Another commenter
expressed support for the proposed
expanded definition of " enhanced
career services" including UI claims
filing assistance and eligibility
assessments.
Departments' Response: The
Departments decline to make changes to
678. 430( a)( 10) to refer to State merit
staff. The assistance requirement only
encompasses helping the individual
navigate the State' s claims filing process
and providing the individual with
general information on their
responsibilities as a claimant. These
functions are informational in nature
and not directly connected to
determining the claimant' s eligibility for
benefits. The requirement does not
encompass speaking specifically to the
individual' s potential eligibility for
benefits or making any determinations
regarding the individual' s eligibility for
benefits, which are inherently
governmental functions that must be
provided by UI merit staff. The
Departments note that it has been
permissible for non -State merit staff to
carry out similar functions, for example,
reviewing compliance with State work
search requirements as part of the
Reemployment and Eligibility
Assessment program for many years.
The Departments reiterate the
importance that, if these functions are
carried out by non -UI staff, States must
ensure that the staff is well trained. The
Departments expect to provide
additional guidance and technical
assistance to States on the
implementation of these provisions. For
the reasons stated above, the
Departments are not revising the
regulatory text in response to these
comments. For more information about
the impact of WIOA implementation
merit staffing for the Wagner-Peyser Act,
see 20 CFR 652. 215.
Temporary Assistance for Needy
Families
Comments: Several commenters
addressed the Departments' request for
comment regarding the identification
and inclusion of TANF employment,
related supported services, and TANF
intake functions as career services that
must be provided in one-stop centers.
For example, some commenters
suggested that because there are so
many ways of delivering TANF intake
services ( e.g., electronically), States
should have flexibility in determining
whether TANF intake services should
be physically located in the one-stop
centers.
Departments' Response: The
Departments recognize the need, and
utility, of providing States flexibility in
implementing TANF intake services and
have added two paragraphs to § 678.430.
Paragraph (a)( 2) of §678.430 states, in
pertinent part, that "[ flor the TANF
program, States must provide
individuals with the opportunity to
initiate an application for TANF
assistance and non -assistance benefits
and services . . ." This provides States
with flexibility as to how this is
achieved. As a required partner,
however, TANF must still provide
access ( as defined by § 678. 305( d)) to
employment services and related
support services. To this end, paragraph
d) has been added to § 678. 430, stating
that " Juin addition to the requirements
in paragraph ( a)( 2) of this section, TANF
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agencies must identify employment
services and related support being
provided by the TANF program (within
the local area) that qualify as career
services and ensure access to them via
the local one-stop delivery system."
Comments: Another commenter
suggested that required partners should
be required to provide TANF outreach
and intake at one-stop centers.
Departments' Response: As TANF is a
required one-stop partner by default,
and only is excluded from the one-stop
delivery system through a decision by
the Governor, TANF outreach and
intake services must be provided at any
one-stop center for which TANF is a
partner.
Comments: One commenter asserted
that including TANF intake functions as
career services would require significant
cross training of other program staff in
their State. For these reasons, the
commenter supported the continuation
of the colocation/ co-enrollment model
for TANF services at one-stop centers.
Another commenter asked whether
State agency staff were properly cross
trained to conduct TANF intake.
Departments' Response: The
Departments recognize that some
services come at higher costs than
others, and this is one of the many
factors that must be weighed in
determining how best to deliver
services. In addition, the question of
what constitutes " proper" training on
the TANF program for local one-stop
workforce staff will depend on the
TANF benefits and services that are
offered at the local one-stop center.
Comments: A few commenters stated
that requiring one-stop centers to
process TANF applications that are not
related to employment is unhelpful and
should not be considered career
services.
Departments' Response: As
mentioned above, the Departments'
review and consideration of comments
made on the NPRM, particularly the
language regarding intake, application
processing, and initial eligibility
determinations for TANF assistance and
non -assistance benefits at one-stop
centers, prompted the Departments to
modify the requirement from how it was
proposed in the NPRM. This modified
requirement, found in final
678.430( a)( 2), requires that, at a
minimum, the one-stop centers must
enable a family to initiate an application
as defined by the State agency) for
TANF assistance and non -assistance
benefits and services. One-stop centers
could accomplish this by having paper
application forms available at the one-
stop center or by having information or
links to the application on the one-stop
center' s Web site.
The Departments have determined
that allowing customers in need of
career services to have the opportunity
to initiate an application for TANF
benefits at one-stop centers is not
counterproductive or unhelpful. On the
contrary, providing for a family' s unmet
needs via a TANF benefit is crucial to
ensuring progress and success in
meeting career service objectives.
The Departments affirm the NPRM
preamble explanation on the
identification and delivery of career
services (restated below) absent a
definition of career services in the
TANF statute.
The TANF statute does not include a
definition for career services.
Accordingly, the TANF State grantees
must identify any employment and
related support services that the TANF
program provides (within the particular
local area) that are comparable with the
career services as described in this
section.
Comments: A few commenters
remarked that there is no universal
English as a Second Language (ESL) test
under TANF or other employment and
training programs and suggested that
ESL providers are better at conducting
language proficiency testing than
employment service providers. Another
commenter suggested that one-stop
providers should be expected to provide
services to linguistically and culturally
diverse populations.
Departments' Response: The
regulations do not require a specific ESL
test as part of the initial assessment of
skills, or to gain meaningful access to
TANF or other Federal programs. They
leave the selection and use of
assessment tools, and qualified
administrators of such tools, up to the
partner program or service provider, as
appropriate to individual participants. If
any one-stop partner or service provider
receives funds directly or indirectly
from HHS or other Federal agencies, it
is required under title VI of the Civil
Rights Act of 1964 and its implementing
regulations, to take reasonable steps to
ensure meaningful access to its
programs by persons with limited
English proficiency. Title VI also
prohibits Federal grant recipients from
utilizing methods of administration that
have the effect of discriminating against
persons based on their race, color, or
national origin. In some cases, a
provider's failure to provide language
assistance to linguistically or culturally
diverse populations could be a violation
of title VI. However, the title VI
requirement to take reasonable steps to
ensure meaningful access does not mean
that jurisdictions are required to provide
universal ESL training. While
individual jurisdictions may need to
provide ESL training and testing to
TANF family members in some cases,
universal ESL training is not a
statutorily mandated requirement.
Other Career Services
Comments: A commenter suggested
that career services also should include
a pre-screening for eligibility for
supportive services such as the
Children' s Health Insurance Program
CHIP), SNAP, the Earned Income Tax
Credit, TANF, and transportation
services alongside the initial assessment
of skill levels.
Departments' Response: Paragraph
a)( 2) of § 678. 430 requires that, along
with intake, an orientation to the other
services and programs provided at the
one-stop center must be given to
participants, and paragraph (a)( 5)
requires referrals to, and coordination
of, activities with other programs and
services. The Departments have
determined that this strikes a balance
between the burden on one program' s
staff to be knowledgeable about other
partner programs and the benefit that
this knowledge can be to participants.
Requiring all staff to do pre-screening
for the programs identified by the
commenter would take time away from
providing actual programmatic
assistance to participants, as well as
delay other participants from receiving
services.
Comments: Other commenters
requested additional guidance on the
initial assessment process. The
commenters asked whether there is a
specific point in service delivery when
initial assessments should be provided
to customers, what the vision and intent
is of this assessment, and how the
assessment is to be used. Another
commenter asked whether there are any
standardized tools to be used to conduct
this assessment.
Departments' Response: The
Departments intend to issue joint
guidance on this subject in the near
future.
Comments: One commenter said that
the assessment should be tailored to
include an evaluation of women' s
interest and aptitude for higher -wage,
nontraditional careers."
Departments' Response: The
Departments have decided not to change
the regulatory text in response to this
comment. The Departments recognize
the importance of placing women in
higher -wage, nontraditional careers, but
note that local areas have discretion to
undertake such an evaluation as part of
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the initial assessment of skill levels
required in § 678.430( a)( 3).
Comments: A commenter
recommended rewording paragraph
b)( 1) of § 678.430 to state,
Comprehensive and specialized
assessments of the skill levels, interests,
values, aptitudes, and service needs of
adults and dislocated workers . . .
Departments' Response: The
Departments have decided not to change
the regulatory text in response to this
comment. The assessment of skill levels
could very well include these elements,
but the Departments had determined
that the inclusion of such elements is
best left up to the Local WDB and
partners to decide, given that they are in
a position to adapt these processes to
local area needs.
Comments: Another commenter
suggested that these assessments should
include disability -related barriers to
employment and the development of an
action plan to reduce these barriers, as
well as information on how to access
common disability -related services. This
commenter also recommended that
when to disclose a disability and how
to request a reasonable accommodation
should be part of career counseling.
Departments' Response: Disability -
related barriers to employment and
information on how to access disability -
related services are elements of the
assessment process that the
Departments encourage Local WDBs and
partner programs to implement, but the
Departments have decided not to change
678.430(b)( 1) in response to the
comment at this time. The assessment
process is meant to be molded to best
fit a local area' s employment
environment and the needs of the
participants, potential employers, and
the community. Moreover, as written,
678. 430( b)( 1)( ii) specifically indicates
that assessments may include in-depth
interviewing and evaluation to identify
employment barriers, which could
include disability -related barriers.
Comments: A commenter expressed
support for the inclusion of financial
literacy as an allowable activity. The
commenter stated that bundling
financial education with workforce
development leads to improved
employment and financial outcomes.
Another commenter suggested that there
should be financial literacy programs
specifically targeting individuals with
disabilities.
Departments' Response: The
Departments agree with the
commenter' s statements about the
bundling of financial education with
workforce development. While the
Departments have chosen not to change
678. 430( b)( 9) to specifically include
financial literacy programs targeting
individuals with disabilities, the
Departments encourage Local WDBs to
implement such plans as they determine
are necessary to meet the needs of a
local area.
Comments: One commenter
recommended that one-stop center
partners should work with local
institutions to ensure that one-stop
customers are banked (e.g., have
banking accounts) to reduce reliance on
predatory lending.
Departments' Response: The
Departments recognize the need to
combat predatory lending and
encourage Local WDBs to make such
partnerships a part of their financial
literacy services programs. However, the
Departments decline to change the
regulatory text to mandate such
relationships because they may not be
appropriate for every local area. The
Local WDB is in the best position to
determine if such a service is needed in
a particular local area.
Comments: Another commenter
recommended that transportation
should be put in a separate paragraph to
emphasize that transportation for youth
includes transportation to one-stop
centers and work sites. The commenter
also suggested that referrals to
organizations that assist with housing,
food, and obtaining identification
documents should be provided at one-
stop centers.
Departments' Response: The
provision of information about the
availability of, and the referral to,
transportation provided through TANF
are included in WIOA
sec. 134( c)( 2)( A)(1)( ix) and in
678. 430( a)( 9) as a career service. The
commenter' s recommendation about
transportation is adequately addressed
in the regulatory provision as drafted,
and the Departments have decided that
it is not necessary to include it in a
separate paragraph. The Departments
have also determined that
678. 430( a)( 9), requiring information
and referrals to be provided for other
supportive services and assistance,
would encompass referrals to other
services as suggested by the commenter.
While the list in the regulation does not
specifically mention some of these
services, it is a non -exhaustive list.
Local WDBs are free to provide
information and referrals to any
supportive services that they determine
would benefit one-stop participants in a
local area.
Comments: Another commenter said
that it might be confusing to
differentiate between basic and
individualized career services.
Departments' Response: The
Departments have decided to make a
distinction and separation between
these terms. Basic services are those
made available to each individual who
accesses a one-stop center, while
individualized services are those that
are tailored to each participant to best
meet his or her needs.
Comments: A commenter suggested
that if career services are classified as
pre -enrollment" and " required
enrollment," Local WDBs could
determine the customer flow without
having to worry about cost issues.
Departments' Response: While the
Departments have determined that some
career services are more appropriate for
those in pre -enrollment or those
enrolled in a program, the Departments
have determined that it is best to leave
this distinction to the Local WDBs, as
they are in better positions to recognize
and respond to the needs of the local
area.
Comments: A couple of commenters
stated that § 678.430(a) potentially
conflicts with §678.305, and suggested
that the Departments rephrase it to read:
Basic career services must be made
available in accordance with the
methods outlined in § 678. 305, at a
minimum. . .
Departments' Response: The
Departments disagree, having found,
after examination of the text, no
conflicting language or intent in these
two sections. No changes to the
regulatory were made text in response to
this comment.
Comments: Another commenter
suggested adding " and recognized
postsecondary credentials" to
678.430(a)(4)(i)(A) to place additional
emphasis on the benefits of such
credentials.
Departments' Response: The
Departments have not made such a
change in the regulatory text, but
postsecondary credentials and their
importance in the employment
environment of a local area will be
emphasized by title II and other
educational programs.
Comments: One commenter expressed
disagreement with §678.430, asserting
that it restricts what WIOA allows. The
commenter recommended that States
should be permitted to develop
guidelines to help local areas determine
how to deliver services.
Departments' Response: After
consideration, the Departments have not
found this section to restrict WIOA' s
allowances and, in fact, the Departments
have determined that § 678.430 is
unrestrictive regarding what services a
one-stop center may provide to a local
area. The list of career services here are
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required, but the list should not be read
as excluding additional career services
that a Local WDB may decide the local
area needs. Nothing in this regulation
prohibits States from developing
guidelines on the deliverance of
services, and the Departments
encourage States to do so.
Comments: A few commenters
requested guidance on how to deliver
career services when multiple one-stop
partners might provide similar services.
Departments' Response: The
coordination among partners over
which partner or partners will provide
a service at any particular one-stop
center or affiliated site is a subject that
must be agreed upon and described in
the MOU.
Comments: A commenter asked for
clarification on the definitions of " group
counseling" and " individual
counseling."
Departments' Response: " Group
counseling" involves two or more
participants addressing certain issues,
problems, or situations that may be
shared by the group members, while
individual counseling" is a one-on-one
session that may go into greater detail
about a particular participant' s needs.
Comments: A few commenters
recommended that States be given
flexibility in determining follow-up
time frames and whether follow-up
services are appropriate.
Departments' Response: The 12 -
month time frame requirement for
follow-up services to be conducted is
established by WIOA sec.
134( c)( 2)( A)(iii).No change to the
regulatory text was made in this section
in response to the comments.
Section 678. 435 What are the business
services provided through the one-stop
delivery system, and how are they
provided?
The one-stop delivery system is
intended to serve both job seekers and
businesses. Similar to job seekers,
businesses should have access to a truly
one-stop experience in which high
quality and professional services are
provided across partner programs in a
seamless manner. Labor markets are
typically regional, but programs often
design service delivery strategies around
State and local geographic boundaries.
Effective business services must be
developed in a manner that supports
engagement of employers of all sizes in
the context of both regional and local
economies, but should avoid burdening
employers, for example, with multiple
uncoordinated points of contact. Section
678. 435( a) lists required business
services. Section 678.435( b) States that
local areas have flexibility to provide
services that meet the needs of area
businesses and must carry out these
activities in accordance with relevant
statutory provisions.
Comments: A commenter encouraged
the Departments to improve the
marketing of one-stop services to
employers, because many employers
that could benefit substantially from
these services are not aware that there
are one-stop services available to them.
Departments' Response: While the
Departments encourage Local WDBs and
one-stop operators to increase efforts to
reach out to local business industries
and sectors, and to form and foster these
relationships and partnerships is
required by both the regulations in the
section and WIOA, the Departments
have determined this is a decision best
left up to the Local WDBs. This will
ensure that these efforts can be
customized to fit the particular
employment environment of the local
area and remain malleable to the
changing employment landscape.
Comments: Several commenters
recommended that employers be
provided with an individual liaison at
the one-stop center.
Departments' Response: Individual
liaisons can be an effective mechanism
for serving employers. However, each
local one-stop center should structure
business services to best meet the needs
of the employers that they serve; the
Departments decline to require that all
one-stop centers use this structure,
although it may be a best practice that
should be encouraged. The Departments
also note that the duties of the one-stop
operator under § 678. 620( a) may include
the coordination of service delivery by
required one-stop partners and service
providers. This could reasonably
include interacting with employers on a
regular basis to ensure that appropriate
service providers are meeting the
employers' needs. For these reasons, no
change was made to the regulatory text
concerning this topic. However, the
Departments will continue to engage
with business customers to determine
the best ways to determine effectiveness
in serving employers and to improve
those services continuously.
Comments: Several commenters
recommended eliminating references to
sector partnerships in this section. The
commenters asserted that it is important
to distinguish between developing and
implementing sector partnerships and
simply providing career or training
services to employers in a particular
industry. Further, the commenters said
that while sector partnerships are
described as a required activity in
678. 435( a), paragraph (c) describes
sector partnerships as one of several
permissible activities that Local WDBs
may undertake. The commenters
suggested that the Departments should
revise the language to state that Local
WDBs should ensure that business
services provided at one-stop centers
can support sector partnerships in local
areas.
Departments' Response: The
Departments view the development of
industry and sector partnerships as a
critical business service that local areas
must explicitly provide as required by
WIOA sec. 134( c)( 1)( A)(v). Regarding
the commenters' statements about
678.435( a) and (c), these paragraphs do
not describe the same services.
Paragraph (a) refers to " industry or
sector partnerships," while paragraph
c)( 1) refers to " industry sector
strategies," which, as is noted in the
regulatory text, could include strategies
involving industry partnerships.
Because these are separate services and
not references to the same or duplicative
services, the Departments have
concluded that no change to the
regulatory text is necessary. Moreover,
while it is important for business
services provided through one-stop
centers to properly support industry
sector partnerships, to change the
regulatory text to specify this could
have the unintended consequence of
making this appear as a priority above
providing these services to non -partner
employers that seek them out.
Comments: One commenter requested
additional guidance regarding the
implementation of sector partnerships,
particularly the role of the convener
e.g., Local WDBs). Another commenter
said that the limited instructions in the
NPRM regarding sector partnerships
might indicate that they are not a high
priority and result in delayed
implementation.
Departments' Response: The
Departments have concluded that the
regulatory text does not indicate these
sector partnerships are a low priority,
but rather the regulatory text indicates
that the details of how these
partnerships are structured and operate
are best left to Local WDBs with agency
guidance, as they are in a better position
to know the individual needs of a local
area.
Comments: The Departments received
a number of comments that discussed
the types of services that should be
available to employers. One commenter
suggested that one-stop centers should
be able to provide services for
employers interested in hiring
individuals with disabilities. Another
commenter said that the list of services
to employers should be expanded to
include services that are important for
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hiring and retaining employees with
disabilities, including " information on
work experience options and tax credits,
assistance and information on job
accommodations and assistive
technologies, and disability awareness
training."
Departments' Response: The
Departments have considered the
suggestions regarding the types of
services that should be available to
employers, and have decided to amend
the regulatory text to include some, but
not all, of the suggestions.
Business services related to job
accommodations and assistive
technology for individuals with
disabilities have been included at
678.435(b)(4)(vi) to encourage not only
these specific practices, but also the
provision of other disability hiring
services and general disability
awareness. Information on local, State,
and Federal tax credits is already listed
as a possible business service to be
provided under § 678. 435( c)( 6). The
Departments do not consider
information on work experience
options, suggested by the commenter, as
a business service and have not added
this to § 678. 435( c).
Comments: Another commenter also
suggested including individuals with
disabilities in job fairs and customized
recruitment events and expanding the
list of services to include assistance on
legal requirements and best practices
around accommodating individuals
with disabilities.
Departments' Response: The
Departments recognize the need to
provide access to these services.
However, the Departments have
concluded not to make this addition to
this section of the regulation because
the Departments have determined that
this level of detail is not necessary. All
WIOA services are subject to the
nondiscrimination requirements of
WIOA sec. 188 and its implementing
regulations at 29 CFR part 38.
Additionally, the Departments have
made technical assistance on holding
effective and inclusive job fairs
available and will continue to provide
guidance and resources regarding
appropriate accommodations.
Comments: A couple of commenters
expressed support for § 678. 435 and
suggested additional services to
employers including metrics,
recordkeeping, and data analysis;
affirmative action planning and
assistance with goal attainment;
assessment of employer needs;
accessibility reviews; cultural awareness
of specific disabilities; mentoring; on-
the-job evaluation; and disability
management for existing workforces.
Another commenter said that businesses
could use assistance developing
position descriptions" to better define
the skills required for positions, as well
as assistance locating information on
where certifications are awarded.
Departments' Response: While the
Departments recognize the advantages
of providing these and other services,
the Departments also recognize that
providing an all-encompassing list of
possible business services is an
impossibility and would restrict creative
thinking about methods of service
provision, the encouragement of which
is at the heart of WIOA. Because of this,
the list of possible business services in
the regulation will remain a non -
exhaustive list and the Departments
made no changes to the regulatory text
in response to these comments.
Comments: One commenter
recommended that the Departments
should clarify their use of the phrase
labor laws" to ensure that it is clear
this includes all Federal employment
discrimination laws.
Departments' Response: The
Departments recognize the need for
clarity in this language and have revised
the regulatory text to include
employment and discrimination laws in
678.435(b)( 4)(vii).
Comments: Another commenter
suggested that Job Corps should be a
required partner in the sector
partnerships required in § 678.435( a).
Departments' Response: To fully
support the development of sector -based
strategies, the Departments are
providing States, local areas, and
regions with flexibility. The
Departments strongly encourage that
sector partnerships include a variety of
entities, including training and
education programs like Job Corps.
Given the range of potential partners
and the variety of industries and career
pathways that may be included in a
sector strategy, the Departments are not
placing further regulatory requirements
around partnerships, but will encourage
such partnerships through guidance and
technical assistance.
Comments: One commenter asked
whether the services provided in
678.435(b) but conducted by business
intermediaries need to be located in the
one-stop centers.
Departments' Response: WIOA sec.
134( d)( 1)( A) requires that business
services, which are listed as a
permissible local employment and
training activity at WIOA sec.
134(d)( 1)( A)(ix), be provided through
the one-stop delivery system. No change
to the regulatory text was made in
response to this comment.
Comments: Another commenter
recommended that the Departments
clarify in the regulations that it is an
allowable activity for local areas to
provide business services and develop
relationships with the business
community that will last beyond a
change in one-stop operator or career
services provider.
Departments' Response: The
Departments encourage Local WDBs to
develop strategies to establish and
sustain lasting partnerships and
provision of business services. These
business services may be provided by
the Local WDB or through effective
business intermediaries working in
conjunction with the Local WDB, or
through other public and private entities
in a manner determined appropriate by
the Local WDB and in cooperation with
the State, consistent with § 678. 435( c).
No change has been made to this
portion of the regulatory text in
response to the comment.
Section 678. 440 When may a fee be
charged for the business services in this
subpart?
WIOA allows customized employer -
related services to be provided on a fee-
for-service basis. Section 678.440
clarifies that there is no requirement
that a fee-for-service be charged to
employers. The Local WDBs, however,
should examine available resources and
assets to determine an appropriate cost
structure. These Boards may also
provide such services for no fee. The
regulatory text was revised to add
paragraph (d) to explain that fees earned
are program income.
Comments: One commenter expressed
support for this section as proposed.
Another commenter said that each
program should be permitted to
determine whether to charge a fee,
instead of the Local WDB making that
decision.
Departments' Response: After
considering this comment, the
Departments have concluded that Local
WDBs are in the best position to
determine what business services are
needed in a local area and what fee, if
any, should be associated with the
provision of these services. The
Departments encourage Local WDBs to
consult with partner programs when
making such decisions, keeping in mind
that any fees collected by partners are
program income allocable to partner
programs in proportion to the partner
programs' participation in the activity.
In this case, program income must be
expended by the partner in accordance
with the partner program' s authorizing
statute, implementing regulations, and
Federal cost principles identified in
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Uniform Guidance to ensure
consistency with program income
disbursement requirements.
Additionally, the partner must consult
its program statute and grant
requirements to determine which
method to use when disbursing program
income as described in the Uniform
Guidance at 2 CFR 200. 307( e).
Comments: One commenter expressed
concern that employer services beyond
the provision of no -charge services
under the Wagner-Peyser Act have not
been discussed.
Departments' Response: Local WDBs
are not limited to only those business
services discussed in this and other
sections. They may also provide other
business services that meet the
workforce investment needs of area
employers. If the Wagner-Peyser Act
program provides funds for a business
service, a fee cannot be charged. The
Departments have concluded that the
regulations sufficiently address business
services and will not modify the
regulatory text in response to this
comment. Further joint guidance,
however, will be released on this topic.
Comments: A few commenters
expressed concern about the prohibition
on charging a fee for certain services.
These commenters asked whether
appropriate recruitment and other
business services on behalf of
employers" includes activities such as
career expos, job fairs, and sector
convening events. The commenters said
that these events can be quite costly,
and suggested that this section state that
no fee, above a cost recovery fee, may
be charged for services described in
678.435( a).
Departments' Response: Events such
as career expos, job fairs, and sector
convening events are not subject to the
prohibition on charging fees as they are
services provided under § 678.435(b)
and (c). For example, Wagner-Peyser
Act funds are used for general labor
exchanges, but these are limited to
situations such as the use of a job board.
These larger events are more tailored for
employers, for which fee-for-service is
allowed. WIOA sec. 134( d)( 1)( A)(ix)
discusses activities to promote business
services and strategies to meet
workforce needs of employers, which
may be provided on a fee-for-service
basis.
4. Memorandum of Understanding for
the One -Stop Delivery System ( 20 CFR
Part 678, Subpart C; 34 CFR 361. 500
Through 361. 510; 34 CFR 463. 500
Through 463. 510)
This subpart describes the
requirements for the MOU between the
Local WDB, CEO, and the one-stop
partners relating to the operation of the
one-stop delivery system in the local
area. The Local WDB acts as the
convener of MOU negotiations and
shapes how local one-stop services are
delivered. One comment concerning the
extension of existing MOUs to cover
one-stop operations in PY 2016 was
very pertinent and, as explained below,
helped inform the Departments'
decision on the implementation of the
State funding mechanism, although this
decision did not affect the regulatory
language in subpart C. As explained in
greater detail below, the Departments
promulgate this subpart with no
substantive changes.
Comments: A commenter suggested
that Governors should be permitted to
opt out of the MOU requirement if a
comparable mechanism already exists
and achieves the desired results.
Departments' Response: While the
Departments recognize that existing
mechanisms may already be in place in
many States and local areas, bypassing
the WIOA MOU process is not an
option, because partner participation in
the MOU is required by WIOA sec.
121(b)( 1)( A)(iii).Any existing
mechanisms will need to be supplanted
by the WIOA MOU mechanism.
Section 678. 500 What is the
Memorandum of Understanding for the
one-stop delivery system and what must
he included in the Memorandum of
Understanding?
Section 678. 500 describes what must
be included in the MOU executed
between the Local WDB, with the
agreement of the CEO, and the one-stop
partners relating to the operation of the
one-stop delivery system in the local
area.
Comments: A commenter
recommended allowing existing MOUs
in place under WIA to extend for the
first program year of WIOA to
acknowledge the unlikelihood of
negotiating MOUs before the deadline.
Departments' Response: The
Departments note the first year of
implementation for WIOA MOU
provisions was PY 2015 ( July 1, 2015 to
June 30, 2016), which concluded prior
to the effective date of these regulations.
Comments: A commenter asked who
specifically is supposed to write the
MOU and wondered whether they can
trust Local WDBs to write their own
agreements.
Departments' Response: Neither
WIOA nor the regulations address
which entity writes the MOU, but
678. 500( a) specifies that the MOU
must be a " product of local discussion
and negotiation" among the Local WDB,
chief elected official, and the one-stop
partners," who all must sign it,
according to paragraph (d), and which
must include procedures for amending
and reviewing it, according to
paragraphs (b)( 5) and (6). The
Departments have determined that these
provisions, and those in § 678. 510,
include adequate safeguards for the
drafting of the MOUS, and that
specifying a single entity to draft the
MOU would be too prescriptive.
Comments: A commenter asked, for
single -area States, if the State WDB
assumes the MOU negotiation
responsibilities, or whether the
Governor/ mayor assumes these
responsibilities.
Departments' Response: WIOA and
the regulations do not assign negotiation
responsibilities to a single party, and the
regulations specify the joint nature of
the responsibility among the parties.
Therefore, no specific governmental
entity is required by these regulations to
assume MOU negotiation
responsibilities, in single -area States.
Comments: A few commenters
supported the inclusion of provisions in
this section that would allow one-stop
partners to share client data through
MOUs and confidentiality agreements.
Departments' Response: WIOA and
the regulations are silent on the
inclusion of data sharing agreements in
the MOU, but the Departments have
concluded that the MOU may include
such agreements, consistent with all
applicable laws and regulations
including 34 CFR 361. 38 ( covering VR
program privacy safeguards). No change
to the regulatory text was made in
response to these comments.
Comments: A commenter said that the
regulations should clarify that MOUs
must be in accordance with 34 CFR
361. 38.
Departments' Response: The
Departments agree; MOUs must not
contain any provisions that violate the
requirements of 34 CFR 361. 38, which
covers the protection, use, and release of
personal information within the VR
program. This applies specifically to
678. 500(b)( 3), which requires that
MOUs include methods for referring
individuals between the one-stop
operators and partners for appropriate
services and activities, as there are
specific guidelines to be followed in 34
CFR 361. 38( e) regarding the release of
participating individuals' information.
As there are no specific requirements
applying to the sharing of information,
but rather only a requirement that the
MOU provide the method of referrals
from one partner program to another
partner program, the Departments are
not referencing the requirements of 34
CFR 361. 38 in the regulatory text,
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although such requirements will be
mentioned in guidance released to aid
in the implementation of the one-stop
delivery system.
Comments: Another commenter said
that the MOU should include a specific
process to ensure individuals are
screened to determine the best set of
services to receive at the one-stop
center.
Departments' Response: The
Departments agree that individuals
should receive the services that best
meet their needs, but do not agree that
the regulations should prescribe a
screening process, especially given
WIOA' s movement away from the
sequential delivery of services provided
under WIA. The Departments will
address this issue in guidance, if
necessary, and through technical
assistance.
Comments: A few commenters
requested additional guidance on MOU
requirements, including whether the
MOU should address partnerships that
do not involve financial commitments,
like housing agencies.
Departments' Response: All one-stop
partners must be signatories to an MOU,
and all must use a portion of their funds
to maintain the one-stop delivery
system including their proportionate
share of one-stop infrastructure costs,
whether this is through cash
contributions, non-cash contributions,
or third -party in-kind contributions.
These requirements are covered in
much greater detail in subpart E of this
part.
Section 678. 505 Is there a single
Memorandum of Understanding for the
local area, or must there be different
Memoranda of Understanding between
the Local Workforce Development Board
and each partner?
Section 678. 505 establishes that a
Local WDB and one-stop partners may
develop a single " umbrella" MOU that
applies to all partners, or develop
separate agreements between the Local
WDB and each partner or groups of
partners. Under either approach, the
MOU requirements described in
678. 500 apply. The Departments
encourage States and local areas to use
umbrella" MOUs to facilitate
transparent, flexible agreements that are
not burdensome so that partners may
focus upon service delivery.
Comments: One commenter expressed
support for the option to utilize an
umbrella MOU or individual MOUs
with each partner. Another commenter
agreed that the umbrella MOU is the
best approach, and said that MOUs for
all local areas should be in a consistent
format. In addition, a commenter
asserted that WIOA sec. 121( c)( 1)
requires each Local WDB to enter into
one MOU with all of the partners.
Departments' Response: The
Departments interpret sec. 121( c)( 1) as
permitting a single umbrella MOU that
encompasses all partner programs, and
the Departments encourage the use of
such MOUs, but they are not required.
No change to the regulatory text was
made in response to this comment. The
Departments will provide suggestions
about the MOU in guidance and through
technical assistance. However, because
the MOU is the product of local
discussion and negotiation developed
by the Local WDB, with the agreement
of the chief elected official and the local
one-stop partners, which relates solely
to the operation of the one-stop delivery
system in that particular local area, the
determination of an MOU' s format is
best left to the Local WDBs, as long as
the MOU meets the requirements
outlined in § 678. 500 and any
requirements mandated by the State.
Comments: A different commenter
expressed opposition to umbrella
MOUs, saying that they will result in
inaccurate cost allocations and
inappropriate service delivery
decisions.
Departments' Response: The
Departments have determined that there
is no reason why umbrella MOUs will
be less effective than multiple MOUs in
addressing cost allocation and service
delivery decisions in most situations.
No change to the regulatory text was
made in response to this comment.
Comments: A commenter remarked
that statewide organizations, such as
VR, could have to enter into several
dozen MOUs to cover all local areas.
Departments' Response: This is
correct. Any program that is a partner in
a one-stop center, whether they are a
partner in one or more, must sign an
MOU with the appropriate Local WDB.
Comments: A commenter suggested
that the State WDB and any statewide
partners negotiate on a " mandatory
agreement template" that can be used by
Local WDBs in their MOUs with these
statewide agencies. Another commenter
agreed and supported the development
of a standard MOU for use with all
Local WDBs.
Departments' Response: While there
is nothing to preclude the use of such
a strategy, the Departments have
determined not to require, encourage, or
discourage such a method in order to
leave the MOU mechanism as flexible
and adaptable to local area situations as
possible.
Comments: A commenter said that
partner programs operating outside of
the workforce area ( e.g., INA programs,
Job Corps) should not be required to
sign MOUs. Rather, the commenter said,
these programs should commit to taking
referrals from local areas and vice versa.
Departments' Response: If a program
is a required one-stop partner under
WIOA sec. 121( b)( 1) and the
corresponding regulations found in
subpart B of this part, then that program
must sign an MOU with the Local WDB
for each local area where it is a partner.
According to WIOA sec. 121( b)( 1)( A),
required partners are limited to those
entities that carry out programs or
activities in a local area. Likewise, if a
program is not required to be a partner
but is approved by the Local WDB and
CEO as an additional partner, that
partner program must sign the
respective MOU. The Departments have
determined that, as this is required by
WIOA, no changes to the regulatory text
regarding what entities are required to
sign MOUs are necessary.
Section 678. 510 How must the
Memorandum of Understanding be
negotiated?
Section 678. 510 describes the
collaborative and good -faith approach
Local WDBs and partners are expected
to use to negotiate MOUs. " Good -faith"
negotiations may include fully and
repeatedly engaging partners,
transparently sharing information, and
maintaining a shared focus on the needs
of the customer. Section 678. 510( a)
allows Local WDBs, CEOs, and partners
to request assistance from a State agency
responsible for the program, the
Governor, State WDB, or other
appropriate parties when negotiating the
MOU. The Departments acknowledge
that additional guidance and technical
assistance will be needed on MOU
requirements and negotiating
infrastructure funding agreements. The
Departments will issue guidance on this
topic. Ongoing technical assistance will
be made available to the public
workforce system as well.
5. One -Stop Operators ( 20 CFR Part 678,
Subpart D; 34 CFR 361. 600 Through
361. 635; 34 CFR 463. 600 Through
463. 635)
This subpart addresses the role and
selection of one-stop operators. Unlike
the other subparts in this Joint WIOA
Final Rule, this subpart is administered
primarily by DOL. DOL and ED agreed
that the subpart should remain in this
part of the Joint Rule, so that all of the
subparts having to do with one-stop
requirements are together. However,
unlike the rest of part 678, this portion
of the preamble refers mainly to DOL.
For this reason, any reference to " the
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Department" throughout this subpart D
discussion is a reference to DOL.
Comments: As noted, the Department
received and evaluated numerous
public comments on this topic. Several
commenters expressed support for the
Department' s proposal to require
competition for one-stop operators,
primarily on the grounds that
competition leads to better services and
outcomes for job seekers. Others raised
concerns, as detailed below.
Department' s Response: It is the
conclusion of the Department that the
requirement to use a competitive
process for the selection of the one-stop
operator is required by statute, as is the
requirement for continuous
improvement through evaluation of
operator performance and regularly
scheduled competitions. Competition is
intended to promote efficiency and
effectiveness of the one-stop operator by
regularly examining performance and
costs. The Department recognizes the
challenges associated with competitive
selection, including the additional costs
such a process carries with it, the
statutory requirement for a competitive
process is clear. Additionally,
competitive procurement processes are
not uncommon in State and local
government, and the Department
encourages the consideration of
methods used by other State and local
government entities in streamlining
their own process, as well as
consideration of State and local
procurement laws and the Uniform
Guidance. Even with such a reference,
however, additional guidance and
technical assistance will be needed on
MOU requirements and negotiating
infrastructure funding agreements.
Ongoing guidance and technical
assistance will be made available to all
parts of the public workforce system as
well.
Section 121( d)( 2)( A) of WIOA only
allows for selection of a one-stop
operator through a competitive process.
This subpart uses the term " selection"
of one-stop operator through a
competitive process, rather than
designation" or " certification" to avoid
confusion. The competitive process
established by this subpart requires
States to follow the same policies and
procedures they use for procurement
from non -Federal funds as allowed
under the Uniform Guidance at 2 CFR
200. 317. All other non -Federal entities,
including subrecipients of a State ( such
as local areas), are required to use a
competitive process based on the
procurement standards in the Uniform
Guidance set out at 2 CFR 200. 318
through 200. 326.
Unlike under WIA, there is no
designation" or " certification,"
separate from the competitive selection
requirements, of any entity as a one-stop
operator, including a Local WDB. For
Local WDBs, WIOA imposes an
additional step beyond the competitive
selection. Section 107(g)( 2) of WIOA
states that a Local WDB may be
designated or certified as a one-stop
operator only with the agreement of the
CEO in the local area and the Governor.
DOL interprets this provision to create
an additional requirement for situations
in which a Local WDB is selected to be
a one-stop operator through the
competitive process as required under
WIOA sec. 121( d)( 2)( A) and as
described in this subpart at § 678. 605( c).
In situations in which the outcome of
the competitive selection process is the
selection of the Local WDB itself as the
one-stop operator, WIOA sec. 107( g)( 2)
requires that the Governor and CEO
approve the selection.
The DOL received many public
comments regarding the impact of
competition on local services. In
response to these comments, changes
were made to § 678. 605, simplifying the
language regarding the procedures to be
followed in conducting a one-stop
operator selection competition. Some
minor changes were also made to
678. 620 and 678. 635 for clarity and
consistency.
Section 678.600 Who may operate one-
stop centers?
Sections 678.600(a) through (d)
describe who may operate a one-stop
center. As stated in paragraph (a), WIOA
allows a one-stop operator to be a single
eligible entity or a consortium of
entities. Consortia, like single entities,
must be selected through a competitive
process. Eligible entities identified in
WIOA sec. 121( d)( 2)( B). Section
678.600( c)( 6) clarifies that a Local WDB,
with the approval of the chief elected
official and the Governor, may serve as
the one-stop operator. Section
678.600( c)( 7) clarifies that another
interested organization or entity, which
is capable of carrying out the duties of
the one-stop operator, may serve as the
one-stop operator. Section 678. 600( d)
repeats the requirement in sec. 121( d)( 3)
of WIOA that elementary schools and
secondary schools are not eligible to be
one-stop operators; however,
nontraditional public secondary schools
such as night schools, adult schools, or
area career and technical education
schools are eligible to be operators.
Section 678. 600 states that a one-stop
operator may be a single entity or a
consortium of entities, and that if a
consortium consists of one-stop
partners, it must include a minimum of
three of the one-stop partners described
in § 678.400.
Comments: One commenter stated
that these two provisions of
678. 600( a), when taken together, do
not make clear whether a single one-
stop partner may be a one-stop operator.
The commenter further stated that a
one-stop operator may be a single one-
stop partner, based on WIOA' s intent
and current practice, but requested that
the regulations clarify this point.
Department' s Response: The
commenter is correct in that a single
one-stop partner may serve as a one-stop
operator. Paragraph (c) of § 678.600 lists
the types of entities that may be selected
as the one-stop operator. This repeats
the eligible entities from WIOA sec.
121( d)(2)( B), adding paragraph ( c)( 6)
which states that a Local WDB, with the
approval of the CEO and the Governor,
may serve as a one-stop operator.
Paragraph (c)( 7) states that an interested
organization of any other type that is
capable of carrying out the duties of
one-stop operator may serve as the
operator. A single entity that is also a
one-stop partner may serve as operator,
but in cases where more than one
partner form a consortia to serve as
operator, WIOA requires that the
consortia contain a minimum of at least
three one-stop partners. The Department
declines to make any substantive change
to the regulatory text and will be issuing
guidance on this topic, as well as for
competition for one-stop operators.
Comments: A few commenters
requested clarification on the phrase,
practices that create disincentives to
providing services to individuals with
barriers to employment that may require
longer-term career and training
services." Paragraph (e)( 2) requires that
State and Local WDBs ensure that one-
stop operators do not establish practices
that create disincentives to providing
services to individuals with barriers to
employment who may require longer-
term career and training services. One
commenter specifically recommended
that one such practice that should be
barred" is sending older workers to
self-service or the Senior Community
Services Employment Program, both of
which would prevent those workers
from being counted in performance
evaluations.
Department' s Response: The
Departments have reiterated throughout
the proposed regulations that all
individuals with barriers to employment
must be fairly evaluated for services,
and services are to be made available
and accessible in an equitable manner
throughout the one-stop delivery
system. Local WDBs must ensure that
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one-stop operators do not create barriers
that limit services to such individuals.
WIOA sec. 188 and the corresponding
regulations provide guidance on such
issues for protected classes.
Comments: A few commenters
expressed concern about the selection of
certain entities as one-stop operators.
For example, one commenter expressed
concern that private entity management
would not be efficient or cost-effective
for rural areas. Further, the commenter
stated that a private entity could have
difficulty providing quality service to
rural areas due to inadequate expertise,
models, or knowledge of living and
working in such areas.
Department' s Response: The final
regulations guard against the concerns
expressed by the commenters. Section
678. 605 requires that the Local WDB is
to make the ultimate selection of the
one-stop operator based on the
principles of full and open competition.
A sound competitive process will
objectively evaluate bidders' proposals
on factors that may consider costs and
the ability to meet the needs of the local
area.
Comments: A commenter expressed
concern that partner infrastructure and
one-stop operating costs could be
impacted by the profit motivation of a
private for-profit entity acting as a one-
stop operator.
Department' s Response: The
Department does not share this concern.
Procurement standards under the
Uniform Guidance at 2 CFR 200. 323( b),
require that profit must be negotiated
separately from the price in addition to
a cost analysis and/ or price analysis.
Records documenting or detailing the
procurement history including the
negotiation and analysis of profit must
be maintained by all entities ( 2 CFR
300.318(h)(i)). This provides
transparency in the actual operating
costs versus profits for any entity,
including for-profit entities, selected
under a competitive procurement.
Section 683. 295 of the DOL WIOA Final
Rule addresses the earning of profit.
WIOA allows private for-profit entities
to be one-stop operators (sec.
121(d)(2)( B)(iv)); therefore, the
regulations are consistent with WIOA.
Private for-profit entities also are
required to adhere to the Uniform
Guidance at 2 CFR part 200. DOL' s
adoption of the Uniform Guidance at 2
CFR 2900. 2 expands the definition of
non -Federal entity' to include `for-
profit' and `foreign' entities. As such,
any private for-profit entity that is a
direct grant recipient or subrecipient of
a DOL award must adhere to the
Uniform Guidance.
Comments: A commenter urged the
Departments to provide maximum
flexibility and more defined authority to
State WDBs to select the one-stop
operator. Additionally, the commenter
asked what it means to be an operator,
how the operator will be paid, and how
firewalls and conflicts of interest are
defined.
Department' s Response: These final
regulations provide maximum flexibility
to States and local areas in selecting
one-stop operators for the one-stop
delivery system as long as the
competitive process is consistent with
the Uniform Guidance at 2 CFR part 200
and/ or with State procurement policies.
WIOA sec. 121( d)( 1) states that Local
WDBs select the one-stop operator, but
they must have the agreement of the
CEO. Governors and CEOs must concur
in cases where the Local WDB acts as
the operator itself. In single -area States,
the State WDB fulfills the requirements
of a Local WDB by selecting the one-
stop operator. A competitive selection
process creates a level playing field
where applicants must propose how to
respond to the unique needs and
requirements set forth by the Local
WDB. Competition is the most effective
way to ensure that providers can
effectively and efficiently serve as one-
stop operators. No changes to the
regulatory text were made in response to
this comment.
Regarding the role of a one-stop
operator, § 678. 620( a) only requires that
the one-stop operator must coordinate
the service delivery of required one-stop
partners and service providers. A
nonexclusive list of other roles that can
be assigned to the one-stop operator also
exists in paragraph (a) of §678.620, but
the assignment of these or other roles is
always at the discretion of the Local
WDB.
Comments: One commenter requested
clarity regarding who may approve the
Local WDB serving as the one-stop
operator when the CEO and the
Governor are the same individual.
Department' s Response: The comment
appears to be addressing concerns about
the treatment of single -area States. In
single -area States and outlying areas
where the CEO and Governor are the
same individual, the Governor approves
the designation of the Local WDB as
one-stop operator after the completion
of a competitive process. Single area
States will follow their own
procurement policies per the Uniform
Guidance at 2 CFR 200. 317. State
procurement policies may include
additional procurement methods
beyond those included in the Uniform
Guidance or may allow for a non-
competitive selection of a government
entity. In cases where there is no
competition, the State and State WDB
must work together to establish
necessary internal controls and firewalls
to provide the public with assurances
that although a competitive process is
not conducted, there is no conflict of
interest. The Department will be issuing
guidance on this topic and will follow
the issuance of guidance with technical
assistance.
As stated above, the competitive
process applies to both State and locally
operated one-stop delivery systems;
WIOA is clear that neither Governors
nor State WDBs have the sole authority
to designate one-stop operators, except
under the conditions of a sole source
method of procurement as stated in
WIOA sec. 123( b). States are expected to
conduct a competitive process for the
selection of a one-stop operator, with
appropriate protections from conflict of
interest, per the State' s own
procurement policies and procedures.
Section 678. 605 How is the one-stop
operator selected?
Comments on the Proposed Competition
Process
DOL examined the comments
received and reviewed the statutory
provisions upon which this section is
based. WIOA made significant changes
to the requirements regarding the
selection of one-stop operators. As
noted in the preamble to the NPRM,
unlike the situation under WIA, WIOA
sec. 121( d)( 2)( A) only allows selection
of a one-stop operation to be made
through a competitive process.
Comments: A number of commenters
generally questioned the complexities
and specificities of the process
described in the NPRM.
Department' s Response: After
considering those comments, the
Department has revised the regulatory
text by deleting much of the specific
contract -related language in the
proposed regulations as applied to non -
Federal entities other than States. The
language now more generally requires
that those entities follow the
competitive process in accordance with
local policies and procedures and the
principles of competitive procurement
in the Uniform Guidance at 2 CFR
200. 318 through 200. 326. This provides
maximum flexibility in implementing
the competition requirement.
Furthermore, as noted in revised
paragraph (c) of §678.605, any reference
to " noncompetitive proposals" in the
Uniform Guidance should be read as
sole source selection" for the purposes
of § 678. 605( c).
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The competitive selection process
permits more than one method of
procurement, and procurement options
are outlined in the Uniform Guidance at
2 CFR 300. 320. Discussions based on
comments made evident that there are
many different methods of procurement
used appropriately throughout the
public workforce system. Moreover,
such methods are generally based on the
Uniform Guidance when Federal funds
are involved. The Department has
determined that it is unnecessary to be
overly prescriptive in defining the
methods of procurement in these
regulations. It is the intention of the
Department to provide extensive
guidance and technical assistance on
acceptable methods of procurement,
using the Uniform Guidance as a basis.
The Department responds to specific
substantive public comments on this
topic in the remainder of this Final Rule
preamble section.
Comments: Many commenters
suggested that existing one-stop
operators that are performing well
should be grandfathered into WIOA and
permitted to continue operating without
competitive procurement, which would
reduce the burden of the competitive
process and ensure continued system
stability during the transition to WIOA.
Some of the commenters further
recommended that Local WDBs and
CEOs should have the authority to
waive the competitive procurement
process after 4 years based on
performance and accountability and
only conduct a competitive
procurement if their evaluations
determine it is warranted.
Department' s Response: The
requirement in WIOA to use a
competitive process for the selection of
the one-stop operator is an unequivocal
statutory requirement, which is clearly
set out in WIOA sec. 121( d)( 2)( A).
Because of this statutory requirement,
the competitive selection process for
one-stop operators in all local areas
cannot be waived. No changes to the
regulatory text were made in response to
these comments. Past performance,
however, is an evaluation factor that
may be considered in the competitive
process, potentially giving weight to
those bidders demonstrating successful
performance as a one-stop operator.
Comments: A commenter stated that
requiring competitive procurement for
its one-stop operators would be
detrimental to the State' s workforce
because any new operator would have
to invest in new infrastructure, which
would take time and money away from
implementing programs. Further, this
commenter stated that the existing State
employees, who are unionized, could be
laid off if new operators were selected.
Department' s Response: Costs and
burdens placed on the one-stop delivery
system by the selection of a new one-
stop operator is one of many factors that
may be taken into account by a Local
WDB or State WDB under the terms of
the competitive selection process. Other
factors may include, but are not limited
to, performance results, performance
results by targeted population,
certification results, and price. Single -
area States will follow their own
procurement process per the Uniform
Guidance at 2 CFR 200. 317. State
procurement policies may include
additional procurement methods
beyond those included in the Uniform
Guidance, including sole source
procurement. In appropriate instances,
the State and State WDB must work
together to establish necessary internal
controls and firewalls to provide the
public with assurances that there are no
conflicts of interest. Further, the
Department hopes that any disruption to
existing public workforce system
employees will be limited under the
new competitive procurement policies.
However, the Department is also
confident that the intent of Congress in
these provisions was to increase
competition among the publicly funded
WIOA programs. The implications of
collective bargaining agreements will
have to be taken into consideration
within the provisions of State or Federal
procurement and other legal
requirements. As such, no changes were
made to the regulatory text in response
to this comment.
Comments: A few commenters
suggested that sole sourcing should be
permitted when a public agency is
selected as the one-stop operator,
reasoning that a competitive process
would disrupt delivery of workforce
services to job seekers and employers.
Another commenter urged that rural
areas should be exempt from the
competitive process, while a different
commenter recommended that single -
area States should be exempt from the
competitive process.
Department' s Response: As stated
above, sole source selection is allowable
as long as the situation falls within the
guidelines and requisite conditions of
State and local procurement policies
and procedures and the conditions
outlined in the Uniform Guidance. The
Local WDB must be able to demonstrate
that it conducted sufficient market
research and outreach to justify sole
source selection. No change to the
regulatory text was made in response to
these comments.
Comments: Some commenters stated
that requiring a competitive process
would divert resources away from
delivery of services.
Department' s Response: While the
Department recognizes the challenges
associated with competitive selection,
including the additional costs, the
statutory requirement for a competitive
process for selection of a one-stop
operator is clear. Additionally,
competitive procurement processes are
not uncommon in State and local
government, and the Department
encourages the consideration of
methods used by other State and local
government entities in streamlining
their own processes, as well as State and
local procurement laws and the Uniform
Guidance. No change was made to the
regulatory text in response to these
comments.
Comments: A commenter
recommended that the regulations
permit Local WDB personnel to staff
one-stop operators and service
providers, with the agreement of the
CEO and Governor, which would
provide more flexibility to the CEO to
determine the most efficient and
effective one-stop delivery system for
their area.
Department' s Response: The
Department has determined that such
staffing is allowable, as long as the Local
WDB is selected in accordance with the
requirements of the regulations and
proper firewalls are in place. As the
commenter noted, in such
circumstances the agreement of the
Governor and CEO is required as an
additional step in the approval of the
Board as the one-stop operator.
Comments: One commenter
recommended that if there is no cost
associated with the selection of a
consortium as a one-stop operator, there
should be no competition.
Department' s Response: As noted,
WIOA imposes the requirement of a
competitive process. The fact that a
particular entity, such as the consortium
mentioned by the commenter, would be
at no cost, however, might be taken into
account by the Local WDB under the
terms of the selection.
Comments: Several commenters
disagreed with the Department' s
interpretation of the relationship
between WIOA secs. 107( g)( 2) and
121( d)( 2)( A). The commenters asserted
that WIOA sec. 107(g)( 2), which states
that a Local WDB may be designated or
certified as a one-stop operator only
with the agreement of the CEO and the
Governor, is a separate and unrelated
provision from WIOA sec. 121( d)( 2)( A),
which requires a competitive selection
process for the one-stop operator. They
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suggested that a Local WDB can be
designated as a one-stop operator solely
under WIOA sec. 107(g)( 2), without
having to undergo the competitive
process described in WIOA sec.
121( d)( 2)( A).
Department' s Response: The
Departments received and evaluated
numerous public comments on this
topic. It is the conclusion of the
Departments that the requirement to use
a competitive process for the selection
of the one-stop operator is required by
statute, as is the requirement for
continuous improvement through
evaluation of operator performance and
regularly scheduled competitions.
Competition is intended to promote
efficiency and effectiveness of the one-
stop operator by regularly examining
performance and costs.
The relationship between these two
provisions of WIOA was duly noted and
considered by the Departments. After
extensive consideration, the
Departments have not changed their
interpretation of the relationship
between WIOA secs. 107( g)( 2) and
121( d)( 2)( A) as providing that a Local
WDB may be designated or certified as
a one-stop operator, with the agreement
of the CEO and the Governor, only after
being selected through a competitive
process for the one-stop operator. In the
Departments' view, the two provisions
read together implement Congress'
emphasis on increasing competition
among the publicly funded WIOA
programs, while also giving the CEO
and the Governor the flexibility to
approve the competitive selection of a
Local WDB as a one-stop operator. The
Departments read sec. 121( d)( 2)( A) as
establishing the governing requirement
for competitive selection of one-stop
operators with sec. 107( g)( 2) imposing
an additional requirement when the
competitive process results in the
selection of the Local WDB. No change
to the regulatory text was made in
response to these comments.
Comments: A few commenters also
stated that the Governor should have the
authority to designate the one-stop
operator in single -area States or States
that have a statewide planning region.
Department' s Response: All areas,
even single -area States, must use a
competitive process to determine the
one-stop operator by following the
Uniform Guidance and State
procurement procedures. Sole source
selection is available but only if the
applicable conditions exist under the
State procurement policies and
procedures. No change to the regulatory
text was made in response to these
comments.
Comments: One commenter also
recommended that the Department
establish a workgroup of single -area
States to provide advice for the Final
Rule.
Department' s Response: Because of
the extensive participation of
stakeholders, including single -area
States and representatives of State
governments in the development of the
NPRM and in the opportunity to
comment on the NPRM before issuance
of this Final Rule, the Department
determined that it is not necessary to
establish a separate workgroup,
although workgroups aimed at serving
other purposes may still be established.
Comments: Several commenters
described potential issues that could
arise from a mandate for competitive
procurements. They said that there
could be: ( 1) Issues with organized labor
representing local workers; ( 2) delays in
service due to staff time being spent on
the procurement process; ( 3) CEOs, who
have liability for funding who are
unable to choose the best solution for
their local area; and (4) loss of local
control. A few commenters suggested
that requiring competition would
increase the liability of the CEO,
contribute to loss of local control, and
increase the overall cost of operation by
dismantling existing, efficient systems
that utilize leveraged funding.
Department' s Response: The
Department is required by WIOA sec.
121( d)( 2)( A) to mandate competitive
selection of one-stop operators and
cannot waive that requirement. Local
WDBs should evaluate risk during all
stages of the competitive selection
process. Leveraged funding or a pledge
for matching funds may be considered
as a scoring factor when evaluating
bidders' proposals for one-stop operator
selection, if the solicitation describes
how such scoring will be awarded. By
following the Uniform Guidance, any
such liability of CEOs is mitigated by
corresponding protections in the
eventual contract. Additionally, the
Department encourages Local WDBs to
work with local partners and one-stop
operators to use innovative and creative
ways of mitigating these issues. No
change to the regulatory text was made
in response to these comments.
Comments: A commenter remarked
that while there are likely situations in
which there is cause to procure one-stop
operators competitively, it is not always
the case that Local WDBs are unable to
oversee the local workforce system
while also serving as the one-stop
operator.
Department' s Response: The
Department agrees, as did Congress.
WIOA allows Local WDBs to serve as a
one-stop operator with the concurrence
of the CEO and the Governor, if the
Board is selected under a competitive
process as provided in the Final Rule.
No change to the regulatory text was
made in response to this comment.
Comments: A few commenters asked
for clarification on whether the rule for
competitive bidding is applied only at
the regional or State sub -area level (such
as a workforce development area), or if
it also applies to operators who are site
managers of one-stop sites.
Department' s Response: The
requirements for the competitive
selection of one-stop operators under
WIOA would apply only to those
procurements carried out by State or
Local WDBs. All direct grant recipients
and subrecipients of a Federal award
must adhere to the procurement
standards found in the Uniform
Guidance. No change to the regulatory
text was made in response to these
comments.
Comments: Several commenters
expressed concerns about the financial
impact of requiring Local WDBs to
conduct competitive procurements, as
this would be a new cost that could
significantly impact limits on
administrative costs. A few commenters
also asserted that the proposed process
of essentially vetting possible
candidates prior to issuing a RFP is
costly and repetitive. Some commenters
said that having a one-stop operator at
all is not cost effective.
Department' s Response: The
Department recognizes that there is a
cost burden associated with conducting
competitive procurements. Both WIOA
and the Uniform Guidance encourage
efficiencies in administrative operations
through streamlining of services or
building from an existing network of
services. To the maximum extent
practical, the Department encourages
States and local areas to leverage their
administrative support for procurement
to reduce burden.
Comments: A few commenters stated
that Congress was intentional in
requiring one-stop operators to be
selected through a competitive process.
These commenters suggested that the
Final Rule should not allow contracts to
be awarded to entities who then
subcontract the work back to State or
local agencies on a noncompetitive
basis.
Department' s Response: The
Department agrees that the requirement
of using a competitive process for the
selection of the one-stop operator
cannot be subverted by subcontracting
the position of one-stop operator on a
noncompetitive basis. By aligning the
one-stop operator competitive process
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with the procurement requirements in
the Uniform Guidance, there are
stringent conflicts of interest and
documentation requirements that will
also apply to one-stop operator
competitions. The Uniform Guidance
requirements also apply to the award of
subcontracts. Application of the
Uniform Guidance requirements will
ensure the integrity of the process. For
this reason, the Department sees no
need to change the regulatory language
in response to this comment.
Comments: A few commenters also
said that the regulations should clarify
that one-stop service providers must
also be competitively procured. One
commenter recommended that the final
regulations should ensure that either the
adult and dislocated worker service
provider is also required to perform the
responsibilities of the one-stop operator,
and the Local WDB must hold a
competition to procure a provider to fill
this mixed role; or, if operator and
service provider contracts are bid
separately, an entity must be allowed to
compete for and perform both roles. The
commenter went on to recommend that
Local WDBs should be required to bid
every contract competitively, or request
letters of intent at a minimum, and only
select an operator through a
noncompetitive method if there are no
qualified candidates.
Department' s Response: The
competitive processes outlined in the
Uniform Guidance are applicable to
procurement transactions with a
contractor and not to a sub-awardee
such as an adult or dislocated workers
service provider. It is when WIOA
requires competitive procurement
process such as with the one-stop
operators and youth service providers
that States and Local WDBs must adhere
to such requirements.
Comments: A commenter stated that
there are competitive selection
processes available other than those
listed in the proposed regulations. The
commenter suggested that invitations to
negotiate, professional services
solicitations, and other approaches that
emphasize performance over price
should be considered. Another
commenter requested clarity regarding
whether " competitive process" requires
an RFP. They recommended that
competitive process" be defined to
include all methods permitted under
State procurement laws.
Department' s Response: The
commenters are correct in stating that a
variety of competitive selection
processes exist within approved
procurement practices. As a result, the
regulatory text has been changed from
what was proposed in the NPRM to
allow for greater flexibility in defining
the competitive process to be followed
by non -Federal entities other than
States. The regulations now state that
where States are engaging in a
competitive process, competitions
should he based on the State
procurement policies as defined in State
administrative procedures and should
be the same process used for
procurement with non -Federal funds.
The policies and procedures may
encompass many of the areas suggested
by the commenters. The regulations also
state that where local areas or Local
WDBs are engaging in a competitive
process, competitions should be based
on the local procurement policies as
defined in local administrative
procedures that must be consistent with
all provisions of the Uniform Guidance.
The policies and procedures may
encompass many of the areas suggested
by the commenters. All other entity
types follow the Uniform Guidance
requirements for procurement, which
also contain flexibility in procurement
methods, as well as the type of contract
vehicle used. For example, the Uniform
Guidance does permit sole source as a
method of procurement under certain
conditions. It was determined to be
unnecessary for the Department to be
overly prescriptive in defining the
methods of procurement in these
regulations.
The Department has determined that
this approach provides sufficient
flexibility to enable a range of operators,
including current one-stop operators,
State agencies, Local WDBs, or consortia
of required partners to be selected under
a competitive process as one-stop
operators.
Comments: Another commenter asked
for clarification on whether " selection"
is the same as " procurement," and
whether the selection of a one-stop
operator is always " procurement," and
which parts of the Uniform Guidance
apply to such a selection process.
Department' s Response: While
selection is typically understood as
being a part of the procurement
process—which typically goes through a
series of phases that may include
planning, evaluation, negotiation,
selection, implementation and
closeout—when discussing WIOA one-
stop operators in this Final Rule,
selection refers to the competitive
process by which one-stop operators are
chosen. This process may involve a
number of methods of procurement as
they are described in the Uniform
Guidance. The Uniform Guidance
describes the process and methods that
must be followed to conduct
procurement.
Comments: The commenter further
stated that the solicitation
announcements need to reach a
minimum number of vendors to ensure
a variety of capable vendors have the
ability to bid. In addition, the
commenter suggested that selection of
one-stop operators should include the
ability to serve linguistically and
culturally diverse participants.
Department' s Response: The
Department declines to change the
regulatory text in response to this
comment. Determining the number of
vendors is best left to the Local WDB,
based on the needs identified in the
local area. Typically, two or more
vendors or bidders would be adequate
in meeting the minimum requirement of
competition, which may already be
specified in the State procurement
process.
Comments: Another commenter asked
how providers of career services are
selected. The commenter also asked
whether this must involve a competitive
process.
Department' s Response: Career
services are provided by the various
partner programs participating in the
one-stop center, the details of which are
set out and agreed upon in the MOU. As
mentioned above, these partners are not
required to be procured in a competitive
process under WIOA, but they may be
under State or local procurement
policies.
Comments: Other commenters stated
that the Governor should be allowed to
recommend the RFP process for their
State.
Department' s Response: The
Governor, in consultation with the State
WDB and chief elected official does
have the authority under these
regulations to choose the type of RFP
process for their State that is consistent
with State policy and the Uniform
Guidance. No change to the regulatory
was made text in response to these
comments.
Comments: A few commenters
requested additional guidance on how a
WDB could compete in the procurement
process, either alone or as part of a
consortium. Another commenter asked
if, in single -area States, the State WDB
assumes the responsibilities in WIOA
sec. 107( d)( 10)( A), or if the Governor is
authorized to identify a State entity to
conduct the competition.
Department' s Response: As noted, the
Department has revised the regulatory
text to allow greater flexibility in
defining the competition process for
non -Federal entities other than a State,
deleting much of the language related to
specific procurement methods in the
proposed regulations. The Department
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provides this flexibility because, as it
became apparent through the discussion
of comments, there are many different
methods of procurement throughout the
public workforce system, which are
generally based on the Uniform
Guidance when Federal funds are
involved and which the Department
would consider sufficient to meet the
requirement for competitive selection of
the one-stop operator. It was
unnecessary for the Department to be
overly prescriptive in defining the
methods of procurement in these
regulations, and provisions of proposed
678. 605( c) prescribing certain methods
have been removed.
Length of Time Required Between
Competitions
Comments: A few commenters
addressed the Department' s question
seeking comments regarding the length
of time required between competitions
for one-stop operators. In particular, a
few commenters recommended that the
timelines should be determined by
States. Other commenters stated that 4
years, as proposed in the NPRM, is
appropriate. A few commenters agreed
that 4 years between competitions is
appropriate, but they suggested that
there be an option to extend additional
years if performance expectations are
met or exceeded. A few commenters
suggested allowing more flexibility for
States regarding the length of contracts,
such as providing guidance that
recommends contracts of 3 to 5 years, or
allowing the award of 5 -year contracts
that have an initial base year followed
by 4 option years that can be executed
if the operator is performing well. A few
commenters recommended 6 years
between competitions, as that timeline
would align with two 3 -year
certification periods for one-stop
operators. Another commenter
suggested that local areas should be
permitted to extend an operator' s
contract once by 2 years to reward high
performance.
Department' s Response: After
considering these comments and
recommendations, the Department
decided to retain the period of 4 years
as it is consistent with the other time
periods contained in WIOA for
resubmission of State Plans as well as
re -certification of one-stop centers. The
Department has determined that there is
not a sufficient reason to shorten this
period to 3 years, extend it beyond 4
years, or to leave the timeline
determination to individual States.
Instead, maintaining the proposed 4
years between competitions is
consistent with WIOA' s goals of a
periodic reexamination of local plans
and supporting successfully performing
one-stop centers.
Comments: A commenter remarked
that, given the timelines for competitive
procurement and certification criteria
updates, both processes will be
conducted simultaneously every 12th
year. The commenter suggested that the
Department adjust these timelines to be
event -driven, rather than simply time
dependent.
Department' s Response: While the
Department recognizes the difficulties
that the timing may cause, after
considering the comments and
suggested changes, the Department
concluded that leaving these processes
on set timelines, as opposed to event -
driven timelines, is the best way to
insure integrity in the process and will
reap the best outcomes for the one-stop
delivery system. As such, the
Department has made no changes to the
regulatory text in response to this
comment. Guidance and technical
assistance on this section regarding
competition will be made available to
all parts of the public workforce system.
Section 678.610 When is the sole -
source selection of one-stop operators
appropriate, and how is it conducted?
Section 678. 610 explains when and
how sole -source selection of one-stop
operators is appropriate as a part of a
competitive procurement process. The
text has been changed from the NPRM
to delete the references to the specific
acceptable processes in proposed
678. 605( d)( 3) and to indicate that State
and local entities must follow their own
procurement rules in addition to the
Uniform Guidance, as appropriate. It
also includes requirements about
maintaining written documentation
regarding the entire selection process,
and developing appropriate conflict of
interest policies. It states that a Local
WDB may be selected as one-stop
operator through sole source
procurement only with the agreement of
the CEO in the local area and the
Governor. The Governor must approve
the conflict of interest policies and
procedures the Local WDB has in place
when also serving as the one-stop
operator. This is consistent with the
Departments' interpretation of sec.
107( g)( 2) of WIOA—the section adds an
additional check in situations where a
Local WDB is selected to be operator.
Comments: Several commenters
recommended allowing the Governor to
designate the one-stop operator when
the State is a single -area State,
particularly if the State has a history of
meeting performance standards. Several
commenters also recommended
allowing CEOs to designate the one-stop
operator without a competitive process
so as not to interrupt program
continuity, particularly if the operator is
already performing well.
Department' s Response: WIOA
requires the selection of one-stop
operators through a competitive process.
The Governor or CEOs may not
designate an operator without a
competitive process. No change to the
regulatory text was made in response to
these comments. It is possible for the
Governor to select an organization, such
as the State WDB, by sole source
selection after a competitive process.
Otherwise, Local WDBs are responsible
for conducting a competitive process to
select a one-stop operator, which must
also he consistent with the Uniform
Guidance. The Department encourages
Local WDBs to plan for the competitive
process and allow for transition time to
minimize any disruption and ensure
program continuity. Local WDBs can be
selected as one-stop operator through
sole source procurement only with the
agreement of the CEO in the local area
and the Governor. Under § 678. 610( d),
the Governor must approve the conflict
of interest policies and procedures that
the Local WDB has in place when also
serving as one-stop operator. This is
consistent with DOL' s interpretation of
WIOA sec. 107( g)( 2)— the section adds
an additional check in the situations
where a Local WDB is selected to be
operator.
Comments: One commenter also
suggested that local areas already
operating under a consortia model with
demonstrated success be permitted to be
sole sourced. Another commenter stated
that very large, complex local areas
should be able to sole source a " system
operator" provided that the individual
one-stop operators are procured through
a competitive process.
Department' s Response: While WIOA
requires selection of the one-stop
operator through a competitive process,
under the Uniform Guidance there is the
flexibility for sole source as a method of
procurement; however, there are
conditions that must be met to allow for
sole source selection. The Local WDB
must he able to demonstrate it
conducted sufficient market research
and outreach to make that
determination. Additionally,
678.615(b) and (c) require robust
conflict of interest policies and
procedures as well as internal firewalls
within the State agency to address the
real and perceived conflicts of interest
that could arise for a State or local
agency applying to a competition run by
a Local WDB.
The Department notes that this
section is particularly relevant to the
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first competitions that are conducted
after these regulations are promulgated
for one-stop operators. With appropriate
firewalls and conflict of interest policies
and procedures to provide a fair and
open competitive process, entities
serving as one-stop operators at the time
these regulations are promulgated,
including Local WDBs and other current
one-stop operators, may compete and be
selected as operator under the
competition requirements in this
subpart if they are able to do so under
applicable procurement policies and
procedures. However, appropriate
firewalls must be in place to ensure that
the current operator is not involved in
conducting the competitive process, as
that would be an inherent conflict of
interest. No change to the regulatory text
was made in response to this comment.
Comments: A commenter stated that
the Department should reconcile
678.610 through 678.625 with 20 CFR
679.410 to ensure that both one-stop
operations and career services are
awarded competitively. The commenter
provided one exception to this rule: that
the Governor and CEO agree that there
are insufficient providers available for a
competition.
Department' s Response: WIOA does
not link one-stop operator competition
with competition for career services
providers. That decision is left to the
State and/ or Local WDB, and the
Department declines to require this by
regulation. Competitions for certain
types of services are neither expressly
prohibited nor required by WIOA. State
and Local WDBs are in the best position
to determine how extensively to require
service provider competitions in their
respective areas.
Section 678. 615 May an entity
currently serving as one-stop operator
compete to be a one-stop operator under
the procurement requirements of this
subpart?
Section 678.615( a) states that Local
Boards may compete for and be selected
as one-stop operators, as long as
appropriate firewalls and conflict of
interest policies and procedures are in
place. Section 678. 615( b) allows State or
local agencies to compete for, and be
selected as, one-stop operators.
However, there must also be strong
firewalls, internal controls, and conflict
of interest policies and procedures in
place.
Comments: A few commenters stated
that they interpret the Uniform
Guidance on conflict of interest to mean
simply that the specifications and
requirements for the procurement must
be drawn up by a neutral third -party,
and that Local and State WDB members
can take part in the selection, award, or
administration of the one-stop operator
contract so long as no member will see
an increase in pay or benefits upon
award of the contract.
Department' s Response: Competitions
must be undertaken pursuant to
678. 605. States are required to follow
the same policies and procedures used
for procurement with non -Federal funds
while other non -Federal entities are
required to follow local procurement
policies and procedures and the
requirements in the Uniform Guidance
at 2 CFR 200. 318 through 200. 326.
These policies and procedures may
allow or require many of the
commenter' s suggestions. For example,
the Uniform Guidance does permit sole
source as a method of procurement
under certain conditions. The Local
WDB must be able to demonstrate it
conducted sufficient market research
and outreach to make that
determination. With appropriate
firewalls and conflict of interest policies
and procedures to provide a fair and
open competitive process, entities
serving as one-stop operators at the time
these regulations are promulgated,
including Local WDBs and other current
one-stop operators, may compete and be
selected as operator under the
competition requirements in this
subpart if they are able to do so under
the relevant procurement policies and
procedures. In the alternative, they may
be selected under appropriate sole
source processes. However, appropriate
firewalls must be in place to provide
that the current operator is not involved
in conducting the competitive process,
as that would be an inherent conflict of
interest.
The Department wants to make clear
that this approach provides sufficient
flexibility to enable a range of operators
to compete and be selected, including
current one-stop operators, State
agencies, Local WDBs, or consortia of
required partners.
Comments: Several commenters also
asserted that effective firewalls, internal
controls, and conflict of interest policies
already exist in the workforce
development system and have been
reviewed by the States and DOL.
Department' s Response: While the
Department agrees that some effective
firewalls, internal controls, and conflict
of interest policies already exist in the
workforce development system, no
change to the regulatory text was made
in response to this comment. The
procurement standard in the Uniform
Guidance provides guidance on written
codes of conduct covering real,
apparent, and organizational conflicts of
interest for persons involved in the
procurement process.
Comments: One commenter stated
that one-stop operators can be staffed by
Local WDBs as long as firewalls and
conflict of interest policies are in place,
which can include a WDB/ CEO
agreement with organizational charts.
Department' s Response: The
Department agrees that, as long as the
requisite firewalls and conflict of
interest policies and procedures are in
place, a Local WDB can compete to fill
the one-stop operator position. To be
placed in this position, of course, the
Local WDB must win the competition
and then be approved by the Governor
and CEO. While such agreements and
organizational charts are a useful tool to
define firewalls, proper firewalls must
go beyond these tools.
Comments: One commenter asked the
Department to define the term
firewall" as it relates to this section. A
group of Federal elected officials urged
the Departments to establish strong
organizational conflict of interest
provisions in the Final Rule to ensure
fair competition.
Department' s Response: The
Department has determined that the
Uniform Guidance, used in concert with
State procurement procedures,
establishes adequate standards for
conflict of interest policies. Also,
678. 615( b) and (c) require robust
conflict of interest policies, as well as
internal firewalls within the State
agency, to address the real and apparent
conflicts of interest that could arise for
a State or local agency applying to a
competition run by a Local WDB. In
order to ensure flexibility for State and
local entities in designing one-stop
delivery systems, the Department
declines to define these terms further in
the final regulations.
Comments: A few commenters said
that they do not believe it is possible for
a sufficient firewall to be established to
eliminate a real or apparent conflict of
interest when a Local WDB competes to
be a one-stop operator. Even if an
alternate entity were involved in
developing the procurement
requirements, according to these
commenters, the Local WDB would still
need to be involved in developing and
approving them. Other commenters
agreed and requested that single -area
States be granted flexibility on, and
waivers of, this provision. Two
commenters asserted that in small States
where there is very little competition
e.g., a one-stop operator may also be a
service provider), it is not cost effective
to implement firewalls.
Department' s Response: While the
Uniform Guidance does provide
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flexibility, some State and local
procurement policies may prevent a
Local WDB from competing under an
RFP if it is not possible to establish a
sufficient firewall to avoid a real or
apparent conflict of interest. The
Department declines to revise § 678. 615
to provide for a waiver or other
flexibility concerning the requirement
for firewalls and conflict of interest
policies and procedures because
avoiding a real or apparent conflict of
interest is essential to a fair competitive
process. The Department encourages
States and local areas to review their
procurement policies and procedures to
ensure that they are consistent and
contain appropriate firewalls and
conflict of interest policies and
procedures to provide a fair and open
competitive process.
Comments: A few commenters
suggested that because the Governor has
the authority, in agreement with the
CEO, to select the Local WDB as the
one-stop operator, firewalls and conflict
of interest policies are not necessary.
Another commenter agreed with this
suggestion, adding that firewalls and
conflict of interest policies are not
necessary because the CEO would have
oversight responsibilities.
Department' s Response: The
Department disagrees. The Uniform
Guidance, where applicable, calls for a
written code of conduct policy that
includes real, apparent, and
organizational conflict of interest
procedures to provide a fair and open
competitive process. Entities serving as
one-stop operators at the time these
regulations are promulgated, including
States, Local WDBs, and other current
one-stop operators, may compete and be
selected as the operator under the
competition requirements in this
subpart, if allowable under applicable
procurement policies and procedures.
Appropriate firewalls, however, must be
in place to ensure that the current
operator is not involved in conducting
the competitive process, as that would
be an inherent conflict of interest. Such
firewalls pertain to the elected
leadership of the State or local area as
well as to the Boards. The Uniform
Guidance, where applicable, and
678.615(b) and (c) require robust
conflict of interest policies that will
create internal firewalls within the State
agency to address the real and perceived
conflicts of interest that could arise
when a State or local agency applies to
a competition run by a Local WDB. No
change to the regulatory text was made
in response to these comments.
Comments: One commenter expressed
support for the Department' s
requirement to establish appropriate
firewalls and internal controls.
Section 678.620 What is the one-stop
operator' s role?
Section 678. 620( a) describes the role
of the one-stop operator without
prescribing a specific and uniform role
across the system. The minimum role
that an operator must perform is
coordination of all one-stop partners
and service providers.
A change was made to this section for
clarity. The regulatory text was revised
to modify the list of potential roles for
the one-stop operator, as chosen by the
Local WDB, changing it from
coordinating service providers within
the center and across the one-stop
system . . ." to " coordinating service
providers across the one-stop delivery
system."
Comments: Several commenters
addressed the Department' s question
regarding whether all of the functions
listed in proposed § 678.620(b) are
accurately described as inherently the
responsibility of the Local WDB. Some
commenters agreed that all of these
items are inherently the responsibility
of the Local WDB. One commenter
stated that some of the Local WDB
responsibilities may have changed or
been devolved to the operator or fiscal
agent as the one-stop delivery system
has evolved under WIA. A Local WDB
recommended that the Department
remove this paragraph because it adds
confusion, particularly when the Local
WDB or fiscal agent is also the one-stop
operator. The commenter suggested that
CEOs should be responsible for
determining who is responsible for each
function. Another commenter also
stated that, rather than prohibiting
certain actions, the NPRM should
provide guidance to operators regarding
how to deal with conflicting
responsibilities. The commenter stated
that this is particularly necessary for
small States and single area States
where agencies serve multiple roles in
the system.
Department' s Response: The
Department considers these provisions
necessary and consistent with WIOA.
The Department is aware that the
requirements related to formally
procuring the one-stop operator may be
new in many areas, and that the roles
and responsibilities for Boards,
operators, and service providers under
WIOA may differ from those under
WIA. Some roles will continue and
others will be modified in response to
the new requirements and vision
presented by WIOA. Transitioning to a
new, more integrated system of service
under WIOA will take time and
technical assistance from all agencies
involved. Some guidance is already
available to the system in the form of
TEGLs on a variety of subjects, such as
Workforce Innovation and Opportunity
Act Transition Authority for Immediate
Implementation of Governance
Provisions" ( TEGL No. 27-14), " Vision
for the Workforce System and Initial
Implementation of the Workforce
Innovation and Opportunity Act" ( TEGL
No. 4- 15), " Guidance on Services
Provided through the Adult and
Dislocated Worker Program under the
Workforce Innovation and Opportunity
Act (WIOA or Opportunity Act) and
Wagner Peyser, as Amended by WIOA,
and Guidance for the Transition to
WIOA Services" ( TEGL No. 3-15), and
Workforce Innovation and Opportunity
Act (WIOA) Youth Program Transition"
TEGL Nos. 23-14 and 8-15), among
others, which can be found at http://
wdr.doleta.gov/directives/AII WIOA_
Related_Advisories.cfm.
Furthermore, WIOA does not permit
CEOs to be solely responsible for
selecting who carries out each function
of a one-stop center; this is something
to be set forth in the MOU, as agreed
upon by all the local partners and the
Local WDB. No change to the regulatory
text was made in response to these
comments.
Comments: Several commenters
stated that the requirement in
678. 620( b) that one-stop operators
establish firewalls and conflict of
interest policies if they are also a service
provider implies that the organization' s
head would need to establish firewalls
between himself and his own staff who
are delivering services.
Department' s Response: The
Department would like to stress that
there must be appropriate firewalls
between staff providing services and
staff responsible for oversight and
monitoring of services. The same person
or department cannot both provide
services and oversee the provision of
those services. This may require
examination of the organizational
structure of a State or local system to
ensure that adequate firewalls are in
place to ensure appropriate oversight
and monitoring of services. Because the
WIA system operated under similar
internal controls for nearly 2 decades,
the Department does not anticipate that
the WIOA requirements regarding
firewalls, conflict of interest policies,
and procurement procedures will be
major obstacles to WIOA
implementation. The Department also
has determined that the provisions of
the Uniform Guidance at 2 CFR part 200
sufficiently address these issues. No
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change to the regulatory text was made
in response to these comments.
Comments: Commenters also asked
whether, if the organization that wins
the one-stop operator competition is not
also the WIOA title I service provider,
there would have to be another
competition for this service provider
and thus another level of
administration.
Department' s Response: The
Department has concluded that State
and Local WDBs are in the best position
to determine how extensively to require
service provider competitions in their
respective areas, and the Department
encourages States and local areas to
review their procurement policies and
procedures against the Uniform
Guidance to ensure that they are
consistent and contain appropriate
conflict of interest policies and
procedures to provide a fair and open
competitive process.
Comments: A commenter suggested
that when there is a potential conflict of
interest, the State WDB should be
required to certify those one-stop
centers. Another commenter asked how
one-stop operators will be audited to
ensure that internal controls are
utilized.
Department' s Response: The State sets
the criteria for certification of one-stop
centers, and Federal representatives and
State agencies will continue to monitor
the entire public workforce system
under WIOA. As part of such
monitoring and oversight
responsibilities, States and Federal
representatives will review an entity' s
compliance with the Uniform Guidance,
the soundness of its internal controls,
and its internal control framework.
Further, States and local agencies are
audited either independently or under a
State' s comprehensive audit on an
annual or biannual basis, which
includes an examination of the State
and local agencies' internal controls and
internal controls framework. No change
to the regulatory text was made in
response to this comment.
Comments: One commenter said that
there was not enough clarity regarding
staff oversight in one-stop centers. The
commenter asked who is responsible for
performance outcomes and operations
when there are Combined Plan partners,
and also, that CEOs be permitted to
make this determination. Another
commenter agreed that Governors
should be able to determine appropriate
roles for one-stop operators and Boards.
Department' s Response: Some
operating guidance on this subject has
already been released in TEGL No. 27-
14 (" Workforce Innovation and
Opportunity Act Transition Authority
for Immediate Implementation of
Governance Provisions"), and much
more is in development, especially
around performance outcomes of
Combined State Plan partners. The
Department presumes that staff
oversight and other roles and
responsibilities of WDBs and operators
will be set in each State and local area
by the WDB, in accordance with
guidance provided by the Department,
the Governor, and the provisions of the
Uniform Guidance in 2 CFR part 200
regarding the use of Federal funds.
There must be appropriate firewalls
between staff providing services and
staff responsible for oversight and
monitoring of services; however to
ensure this, the Department has
concluded that additional regulatory
language is not required. Having proper
firewalls in place will ensure that the
same person or department does not
oversee its own provision of services.
This may require examination of the
organizational structure of an
organization to ensure that adequate
firewalls are in place to ensure
appropriate oversight and monitoring of
services. No change to the regulatory
text was made in response to these
comments.
Comments: A few commenters
requested clarification of the term
another capacity" in § 678.620(b).
Department' s Response: The text from
678.620(b) in the NPRM reads, in part,
Fain entity serving as a one-stop
operator may perform some or all of
these functions if it also serves in
another capacity, if it has established
sufficient firewalls and conflict of
interest policies. The policies must
conform to the specifications in 20 CFR
679.430 of this chapter for
demonstrating internal controls and
preventing conflict of interest." The
Department has clarified this language,
which now refers to " acting in its other
role," instead of " serves in another
As revised, § 678.620( b)
reads, " An entity serving as a one-stop
operator, that also serves a different role
within the one-stop delivery system,
may perform some or all of these
functions when it is acting in its other
role, if it has established sufficient
firewalls and conflict of interest policies
and procedures. The policies and
procedures must conform to the
specifications in 20 CFR 679. 430 of this
chapter for demonstrating internal
capacity." now
controls and preventing conflict of
interest." The Department has
determined that the term " other roles"
is more readily understood. These could
include such roles as service providers,
State agencies, or Local WDBs.
Comments: One commenter suggested
that the Department should define the
role of a " system coordinator," which
would unify a network of one-stop
operators in large local areas into a more
cohesive local system.
Department' s Response: The
Department has declined to revise the
regulatory text to define such a role, as
this is a function of the Local WDB.
WIOA does not identify a system
coordinator role. Local areas have the
ability to coordinate regionally and
develop local or regional plans. Any
coordination would be established as
part of the local planning process.
Comments: One commenter stated
that one-stop operators should be
allowed to participate in the local plan
development only if there are
appropriate firewalls and conflict of
interest policies in place.
Department' s Response: The one-stop
operator will be a contractor under the
Local WDB. The Local WDB is tasked
with oversight and monitoring of the
one-stop operator. Therefore, if the
operator participates in the
development of the local plan, there
must be adequate conflict of interest
policies and firewalls in place to ensure
the one-stop operator staff who are
participating do not provide input on
any policies associated with oversight
and monitoring of their own actions.
The Department has determined that
this does not require the addition of
regulatory language to this section, as
678.615, 678.620, and 678. 625
require firewalls and conflict of interest
policies to prevent conflicts of interest
in the selection of a one-stop operators,
in the one-stop operator' s role, and in
the functioning of the State and Local
WDBs.
Comments: One commenter
recommended that the regulations
should clarify that the one-stop operator
chosen through the competitive
procurement process is responsible for
carrying out the required activities of
WIOA sec. 134( c)( 1)( A), both directly
and through the one-stop required
partners.
Department' s Response: The
Department has determined that it is
important to provide flexibility to local
areas to define the role of one-stop
operator to meet the needs of the local
area and that § 678. 620 provides this
flexibility. No change to the regulatory
text was made in regard to this
comment.
Section 678.625 Can a one-stop
operator also be a service provider?
Section 678.625 allows a one-stop
operator to also be a service provider.
However, the section clarifies that there
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must be firewalls in place to ensure that
the operator is not conducting oversight
of itself as a service provider. There also
must be proper internal controls and
firewalls in place to ensure that the
entity, in its role as operator, does not
conflict with its role as a service
provider.
Comments: Some commenters
expressed that the process described in
the NPRM for the grant recipient to
operate the one-stop center and/ or
provide career services is difficult to
follow. They expressed concern that the
process as described could lead to
unintended, questionable
procurements."
Department' s Response: After
considering these comments and
examining the language of WIOA sec.
121( d), the Departments have
determined that the process for
separating the functions of operator and
service provider is clear. A one-stop
operator cannot participate in the
selection of a provider to perform
services in which the operator intends
to compete. Specifically, the operator
cannot participate in the planning,
development, review, negotiation, and
selection phases of the competitive
procurement process and then also
submit its own proposal. Moreover,
proper firewalls must be in place, as
well as internal controls, to separate the
functions of oversight, monitoring, and
evaluation of its role as service provider
in order for a one-stop operator to also
serve as a service provider. The
Department will continue to provide
guidance and technical assistance to the
public workforce system in this regard.
Comments: One commenter asserted
that Congress could not have intended
for the WIOA competition provision to
be the catalyst for a regulatory structure
that would entrench service providers
and insulate them from competition
while competing out only the more
tangential oversight position of one-stop
operator, which typically has a much
smaller total impact on the quality of
services delivered to one-stop users. The
commenter remarked that the one-stop
operator and service provider roles have
been " substantially intertwined" over
the years, with WIA sec. 117(d)(2)( D)
even suggesting that operators were also
expected to be service providers. The
commenter stated that it has been
common practice at many one-stop
centers for the roles of operator and
service provider to be bid concurrently,
and common practice in other one-stop
centers for service providers to be
assigned various operator duties as part
of their service provider role.
Department' s Response: The
Departments encourage Local WDBs to
review current service providers
strategically and plan for the
competitive process, allowing for a
period of transition to minimize any
disruption and ensure program
continuity. WIOA does not link one-
stop operator competition with
competition of providers of services in
the one-stop. That decision is left to the
State and/ or Local WDB. No change to
the regulatory text was made in
response to this comment.
Section 678.630 Can State merit staff
still work in a one-stop center where the
operator is not a governmental entity?
Section 678. 630 addresses the
concern about whether State merit staff
can continue to work in a one-stop
center where the operator is an entity
other than the State. State merit staff
support numerous programs at the one-
stop center, including Wagner-Peyser
Act programs, VR, UI, and the JVSG
program. Section 678.630 clarifies that
State merit staff may continue to work
in the one-stop center so long as a
system for the management of merit staff
in accordance with State policies and
procedures is established. Similar to
State merit staff, nothing would prevent
local government staff from being
employees in the one-stop center,
although the Department recognizes that
local government employees are not
equivalent to the State merit staff, as
State merit staff are governed by the
requirements attached to specific
programs that must be in the one-stop
center regardless of operator.
In response to concerns about staffing,
the last sentence of §678.630 has been
revised to clarify that continued use of
State merit staff for the provision of
Wagner-Peyser Act services or services
from other programs with merit staffing
requirements must be included in the
competition for and final contract with
the one-stop operator when Wagner-
Peyser Act services or services from
other programs with merit staffing
requirements are being provided.
Comments: Several commenters
remarked that local staff do not have the
same protections as State merit staff,
and new contractors often bring in their
own staff when taking over programs.
Additionally, these commenters
asserted that it would be cost -
prohibitive for potential applicants to
retain many public employees because
they are typically fully vested and may
be unionized.
Department' s Response: DOL
acknowledges the concerns and points
regarding the State merit staffing
requirement. The benefits of merit
staffing in promoting greater
consistency, efficiency, accountability,
and transparency have been well
established, and the Department intends
to continue the respective UI, Wagner-
Peyser Act, and VR merit staffing
requirements under WIOA. While there
is no merit staffing requirement under
other WIOA core programs, the
Department has determined, consistent
with 20 CFR 652. 215 that Wagner-
Peyser Act and VR staff must meet the
requirements of merit staff. A revision to
the regulatory text, as discussed above,
has been made to § 678. 630 to respond
to concerns about staff.
Comments: Some commenters,
including a few unions, urged the
Department to require that UI and ES
agencies be parties and agree to the
establishment of the NPRM' s " system
for management of merit staff."
Department' s Response: UI and
Wagner-Peyser Act programs will be
party to the establishment of such a
system through their participation and
decision-making on State or Local
WDBs as required partners, and through
their good -faith negotiations during the
MOU process. The Department has
made no changes to the regulatory text
in response to these comments.
Comments: Some of these
commenters also suggested that the
Department should revise § 678. 630 to
require UI and ES agencies to agree to
inclusion of local merit staff in the
competition and final contract, to be
consistent with proposed 20 CFR
652. 216.
Department' s Response: The
Departments decline to make revisions
to policies regarding local merit staffing.
Comments: One commenter stated
that the NPRM, which includes VR in
the list of State merit staff, conflicts
with the responsibility of the designated
State agency (DSA) or designated State
unit (DSU) in sec. 101( a)( 2) of the
Rehabilitation Act of 1973 " by inferring
that the State Board and one-stop
operator may establish State policies
regarding the management of" VR staff.
The commenter also stated that the
NPRM may conflict with RSA Technical
Assistance Circulars 12-03 and 13- 02.
Another commenter expressed support
for including VR as State merit staff, as
this will provide flexibility for States to
integrate VR staff within one-stop
centers.
Department' s Response: In
accordance with this section, State VR
personnel are permitted to perform
functions and activities in a one-stop
center where the one-stop operator is a
non-governmental entity.
This section does not circumvent the
requirements governing the State VR
Program at 34 CFR part 361. In
particular, if State VR personnel are
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performing functions and activities in a
one-stop center operated by a non-
governmental entity, the requirements
related to the responsibility for
administration and the non -delegable
functions of the designated State unit at
34 CFR 361. 13( c) remain in place.
Contrary to the commenter' s
suggestion, neither the State WDB nor
the one-stop operator would assume
sole management of State VR personnel
employed by the designated State unit
responsible for the administration of the
VR services program, because such
responsibility rests fully with the
designated State unit for the VR
program. Rather, the State WDB and the
one-stop operator would establish a
system for management of State VR
personnel in accordance with State
policies and procedures, consistent with
program specific requirements such as
that described in 34 CFR 361. 13( c).
Comments: A few commenters
recommended that CEOs or Local WDBs
should be permitted to determine the
best staffing mix for their local areas.
Department' s Response: WIOA sec.
107( f) and 20 CFR 679. 400 of the DOL
Final Rule describe the Local WDB' s
authority to hire and the appropriate
roles for Board staff and § 678. 620
describes the role of the one-stop
operator in comparison to Local WDB
functions. Local WDBs may establish
appropriate staffing within the confines
of these requirements, but nothing in
these provisions would change staffing
requirements established pursuant to
other laws, such as the Wagner-Peyser
Act merit -staffing requirement. The
Department made no changes to the
regulatory text in response to these
comments.
Comments: One commenter asserted
that, because WIOA does not
specifically amend, address, or rescind
the Employment Services merit staff
exemption granted to Colorado,
Massachusetts, and Michigan under the
Wagner-Peyser Act, this exemption
remains in full effect.
Department' s Response: The benefits
of merit staffing in promoting greater
consistency, efficiency, accountability,
and transparency have been well
established and DOL has proposed
continuing Wagner-Peyser Act merit
staffing requirements under WIOA.
Nonetheless, WIOA is silent on the
continuation of this exemption, and
there is no need to address it in these
regulations. However, to prevent
significant disruptions in service
delivery and to help facilitate
implementation of WIOA, the Secretary
of Labor has elected to continue all
current exemptions to the Wagner-
Peyser Act merit staffing requirement.
This continuation applies only to the
current exemptions; the Department has
no immediate plans to expand this
authority within States that have been
granted this administrative flexibility or
to additional States, and such grants
could be subject to termination in the
future at the discretion of future DOL
leadership.
Section 678.635 What is the
compliance date of the provisions of
this subpart?
While no significant policy changes
have been made to this section, the date
by which Local WDBs must demonstrate
they are preparing for the one-stop
operator competition process has been
changed from June 30, 2016 to [ 90 days
from publication of this Final Rule], in
order to give Local WDBs an adequate
amount of time to actively respond to
the requirements of these regulations.
Comments: A few commenters
requested flexibility to delay
competitive selection if a State
determines that breaking a lease in
existence prior to PY 2014 exceeds the
three percent funding cap for that local
area' s title I or Wagner-Peyser Act
funding for PY 2016. The commenters
requested guidance or technical
assistance if the cost of maintaining
current programming in existing one-
stop centers exceeds the caps.
Department' s Response: DOL has
issued operational guidance on the
continuation of contracts during the
WIA to WIOA transition, and depending
on the State or local interpretation of a
lease agreement, this guidance may be
relevant. Please see TEGL No. 38- 14,
Operational Guidance to Support the
Orderly Transition of Workforce
Investment Act Participants, Funds, and
Subrecipient Contracts to the WIOA,"
which can he found at http://
wdr.doleta.gov/ directives/All_WIOA_
Related Advisories.cfm.
Comments: A commenter stated that
DOL should adjust the implementation
date of this provision to July 1, 2017
from June 30, 2017 to coincide with the
beginning of the new program year,
instead of the last day of the previous
program year.
Department' s Response: After
considering this comment, the
Department has adjusted the date in
678. 635( a) to July 1, 2017 in order to
be consistent with the program year.
Comments: A few commenters
expressed support for regulatory
language that would allow Local WDBs
to continue competitively procured one-
stop operator contracts that are executed
before the June 30, 2017 effective date.
Department' s Response: No regulatory
text changes were made in response to
these comments. The Department
recommends following the guidance
that has been released for continuing,
adapting, and terminating (if necessary)
one-stop services contracts that can be
applied to one-stop operator contracts,
which can be found in TEGL No. 38-14,
Operational Guidance to Support the
Orderly Transition of Workforce
Investment Act Participants, Funds, and
Subrecipient Contracts to the Workforce
Innovation and Opportunity Act,"
which can be found at http://
wdr.doleta.gov/directives/AII WIOA_
Related Advisories.cfm.
Other Comments on One -Stop Operators
Comments: A few commenters stated
that neither WIOA nor the NPRM state
that the Local WDB is required to pay
the one-stop operators. They also
recommended that Governors be able to
set policies for one-stop operators.
Department' s Response: A
competitive process is required for the
selection of the one-stop operator by the
Local WDB, and it is expected that a
sizable portion of the bid -on costs
would be the salary of the one-stop
operator' s staff. One-stop operator roles
and responsibilities are defined in
WIOA and these regulations, and
existing and future operational guidance
and rules will delineate how these
policies are set at the local level. WIOA
sec. 121( d)( 1) delegates the majority of
the authority to set these policies to the
Local WDB. No change to the regulatory
text was made in response to these
comments.
Comments: A commenter
recommended making this section more
collaborative with ED, to be consistent
with the rest of the NPRM. The
commenter expressed concern that this
topic is only under DOL' s auspices
when both Departments oversee the
entities involved in the one-stop
delivery system.
Department' s Response: The
Department agrees; this is a joint
regulation and the comment responses,
in addition to most existing operational
policies, have been developed through
collaboration between the Departments
of Labor and Education. It is the
intention of the Departments to
continue to provide joint guidance and
training to our respective systems of
service in a collaborative manner.
Comments: Another commenter
suggested that the Department should
establish labor standards for staff
working in the one-stop delivery
system.
Department' s Response: The
Department appreciates the concerns
giving rise to this suggestion, but the
establishment of labor standards for
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occupations in State or local
governmental entities carrying out the
provisions of WIOA is outside the scope
of these regulations, as well as the
Departments' administrative authority.
No change to the regulatory text was
made in response to this comment.
6. One -Stop Operating Costs ( 20 CFR
Part 678, Subpart E; 34 CFR 361. 700
Through 361. 760; 34 CFR 463. 700
Through 463. 760)
The regulations governing one-stop
partner funding of infrastructure costs
and other shared costs are intended to:
1) Maintain the one-stop delivery
system to meet the needs of the local
areas;
2) Reduce duplication by improving
program effectiveness through the
sharing of services, resources and
technologies among partners;
3) Reduce overhead by streamlining
and sharing financial, procurement, and
facilities costs;
4) Encourage efficient use of
information technology to include,
where possible, the use of machine
readable forms and shared management
systems;
5) Ensure that costs are appropriately
shared by one-stop partners by basing
contributions on proportionate use of
the one-stop centers and relative benefit
received, and requiring that all funds
are spent solely for allowable purposes
in a manner consistent with the
applicable authorizing statute and all
other applicable legal requirements,
including the OMB' s Uniform Guidance
set forth in 2 CFR chapter II, part 200
Uniform Guidance); and
6) Ensure that services provided by
the one-stop partners to reduce
duplication or to increase financial
efficiency at the one-stop centers are
allowable under the partner' s program.
Infrastructure costs are the
responsibility of all one-stop partner
programs, whether they are physically
located in the one-stop center or not.
Each partner' s contribution to these
costs, however, may vary, as these
contributions are to be based on the
proportionate use and relative benefit
received by each program, consistent
with the partner programs' authorizing
laws and regulations and the Uniform
Guidance at 2 CFR part 200. Section
121(h)(1)( A) of WIOA establishes two
funding mechanisms—a local funding
mechanism and a State funding
mechanism. Under WIOA sec. 121( c),
the Local WDBs must enter into MOUs
that cover, in part, the amount each
partner will contribute toward the one-
stop center' s infrastructure costs. The
Departments strongly encourage Local
WDBs to reach agreement. If the Local
WDB fails to reach agreement with each
of the partners with regard to the
amount each partner will contribute to
the one-stop delivery system' s
infrastructure costs pursuant to WIOA
sec. 121( h)(1)( A)(i)(I), the local area is
considered to be at an impasse. When a
local area fails to reach such agreement,
the State funding mechanism is
triggered pursuant to WIOA sec.
121( h)(1)( A)(ii).
As discussed in more detail in the
analysis of comments regarding
678. 725, the State funding mechanism,
in the event a local area fails to reach
agreement with the one-stop partners,
will not be triggered prior to PY 2017.
In other words, the failure of a local area
to reach an agreement with regard to the
funding of the one-stop centers'
infrastructure costs for PY 2017 ( which
begins July 1, 2017), would trigger the
State funding mechanism, in order to
provide that funds are available to pay
for the one-stop delivery system' s
infrastructure costs in PY 2017. In
specific instances, the triggering of the
State funding mechanism will be based
on the guidance developed by the
Governor under § 678. 705(b)( 3) as to the
timeline for notifying the Governor that
the local area was unable to reach
agreement. The same would be true for
each subsequent program year. States
and local areas may continue to
negotiate local funding agreements as
they have under WIA for the purposes
of PY 2016.
The Departments have determined
this interpretation is most consistent
with the plain meaning of the statutory
provision, because all negotiations for
purposes of the one-stop delivery
system' s infrastructure costs for PY
2016, which begins on July 1, 2016, as
well as the implementation of a State
funding mechanism, would need to
occur well before the start of PY 2016
in order to provide funding for the one-
stop delivery system in PY 2016.
However, sec. 121( h)(1)( A)(ii) makes
clear that the State funding mechanism
does not apply until negotiations fail to
result in an agreement after the start of
PY 2016, which, by necessity, would
make it applicable beginning with PY
2017, and then for all subsequent
program years.
For PY 2017 and all subsequent
program years, when a local area fails to
reach an agreement, thereby triggering
the implementation of the State funding
mechanism pursuant to sec.
121(h)(1)( A)(ii),the Governor, or in
some cases other officials as described
in § 678. 730( c)( 2) and in more detail
below, after consultation with State and
Local WDBs and CEOs, will determine
the amount each partner must
contribute to assist in paying the
infrastructure costs of one-stop centers.
The Governor, or other official in
consultation with the Governor, as
appropriate, must calculate amounts
based on the proportionate use of the
one-stop centers and relative benefit
received by each partner and other
factors stated in § 678.737(b). The
amounts contributed by each one-stop
partner in a local area will be based on
an infrastructure cost budget
determined either by local agreement, as
stated in § 678. 735( a), or by formula, as
stated in § 678. 735( b)( 3) and in
accordance with the remainder of
678. 745 and sec. 121( h)(3)( B) of
WIOA. Section 678. 738( c) sets forth the
limitation for one-stop partners'
contributions under the State funding
mechanism, based on a percentage of
their statewide funding allocation, in
accordance with WIOA
sec. 121( h)(2)( D)( ii).
Comments: A commenter expressed
support for the proposed regulations in
this subpart. Another commenter
requested technical assistance and
additional clarity on these provisions.
One commenter asked that the
Departments describe the expectations
in this subpart and in subpart C for each
one-stop partner program, individually
and separately, because each program
has its own requirements for
administrative costs and infrastructure
contributions based on its authorizing
statute.
Departments' Response: The
Departments have issued operating
guidance that describes the
Departments' views on how these
provisions will work. The expectations
for each partner program will be further
defined in guidance on one-stop
infrastructure negotiations, and
technical assistance will be provided to
the public workforce system following
publication of these regulations. To
describe these details in regulatory
language would be overly prescriptive;
the Departments decline to change the
regulatory text in response to this
comment. Required Federal partner
programs often operate under different
authorizing statutes in addition to
WIOA. Those administering agencies
will issue program -specific guidance
and technical assistance on
infrastructure costs and negotiating
MOUs in addition to any joint guidance
regarding WIOA implementation. The
costs of the one-stop delivery system are
not only supported by infrastructure
funding, but also by the payment of
other shared costs that may be part of
the MOU.
Comments: A commenter stated that
this subpart would have the effect of
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worsening or reducing collaboration
between local programs. The commenter
went on to say that partners do not
know how to implement WIOA' s
options for sharing local infrastructure
costs.
Departments' Response: The
Departments disagree with this general
assessment, and the Departments are
aware of many States and local areas
where infrastructure and cost sharing
agreements have been working well for
some time. The intent of WIOA is to
continue and enhance the collaboration
of partners, with more specific
guidelines, and the Departments intend
to provide further guidance and
technical assistance regarding the
sharing of local infrastructure costs and
other shared costs. No change to the
regulatory text was made in response to
this comment.
Comments: A few commenters
expressed support for a separate funding
line item for one-stop infrastructure
costs.
Departments' Response: Since a
separate line item was not authorized in
WIOA, nor included in any of the
Departments' appropriations, the
Departments are not authorized to
implement separate funding for
infrastructure costs. No change to the
regulatory text was made in response to
these comments.
Section 678. 700 What are the one-stop
infrastructure costs?
Section 678. 700 provides the
definition for infrastructure costs based
on sec. 121( h)(4) of WIOA. In addition,
the section adds common one-stop
delivery system identifier costs. These
costs are those associated with signage
and other expenses related to the one-
stop common identifier, as required by
subpart G of this part.
Jointly funding services is a necessary
foundation for an integrated service
delivery system. Section 678. 700( c)
explains that a partner' s contributions to
the costs of operating and providing
services within the one-stop delivery
system must adhere to the partner
program' s Federal authorizing statute,
and to all other applicable legal
requirements, including the Federal cost
principles that require that costs must
be allowable, reasonable, necessary and
allocable. These requirements and
principles will help one-stop partners
identify an appropriate cost allocation
methodology for determining partner
contributions. There are a variety of
methods to allocate costs, for instance:
based on the proportion of a partner
program' s occupancy percentage of the
one-stop center (square footage); the
proportion of a partner program' s
customers compared to all customers
served by the one-stop; the proportion
of partner program' s staff compared to
all staff at the one-stop; or based on a
partner program' s use of equipment or
other items that support the local one-
stop delivery system. A detailed
discussion of the Departments'
responses to public comments received
on this section follows immediately
below.
Comments: One commenter asked
whether infrastructure costs are
applicable only to partners physically
located in the one-stop centers or to all
partners.
Departments' Response: Infrastructure
costs are applicable to all one-stop
partner programs, whether they are
physically located in the one-stop center
or not. Each partner' s contribution to
these costs, however, may vary, as these
contributions are based on the
proportionate use and relative benefit
received, consistent with the partner
programs' authorizing laws and
regulations and the Uniform Guidance
at 2 CFR part 200.
Comments: Another commenter said
that the Departments need to provide
sufficient guidance on the expectations
for certain programs to ensure that cost
negotiations take place and
contributions occur.
Departments' Response: Since the
issuance of the NPRM, infrastructure
funding guidance has been released by
the Departments, and more guidance
and technical assistance documents will
be released throughout the operational
lifetime of the regulations.
Comments: One commenter suggested
that because the NPRM essentially
requires title I programs to police the
participation of other programs
regarding infrastructure costs, they
would discourage optional one-stop
partners from participating at all.
Departments' Response: Governors
and State WDBs must create the
framework for funding and required
partner programs must operate within
that framework, both at the State and
local levels. Local WDBs will follow this
framework, which must be inclusive of
required partner programs as well as
other programs that are additional
partners in the one-stop centers in that
local area. Once negotiated MOUs are in
place, the State will monitor their
operations, along with the other fiscal
procedures of local areas, as they do
now. The Local WDBs will be
responsible for ensuring that all of the
one-stop infrastructure costs are paid
according to the provisions of the MOU,
as they are the entity with which the
partner programs will be signing the
MOU. No change to the regulatory text
was made in response to this comment.
Comments: A commenter said that
proposed § 678. 700( c) should begin,
toEach entity described in . . ."
clearly indicate that partners must
contribute funds for infrastructure,
regardless of whether a partner wants to
have a service delivery mechanism
separate from the one-stop center.
Departments' Response: The
Departments have determined that the
regulation is clear as proposed, and
have concluded that this change is not
needed and would cause unnecessary
confusion.
Comments: Another commenter
suggested that Perkins Act funds should
not be shifted to infrastructure support.
Departments' Response: As a
statutorily required partner of the one-
stop center under WIOA, a Perkins
eligible recipient at the postsecondary
level, or a consortium of eligible
recipients at the postsecondary level in
a local area, will now be involved in the
development of local MOUs, which
spell out the services to be provided
through the one-stop centers. All
partners must contribute to the one-stop
infrastructure costs according to WIOA,
as is described in more detail in
678. 720( a). No change to the
regulatory text was made in response to
this comment.
Comments: One commenter expressed
concern that, given the " proportionate
use by or benefit to the partner
program" clause in this part, TANF or
Basic Food Employment and Training
could incur a significant cost due to the
volume of clients served by these
programs. The commenter also asked if
this funding is in addition to the funds
already provided for employment
services.
Departments' Response: With regard
to the TANF program, only those funds
used for the provision or administration
of employment and training programs
are considered in infrastructure and
MOU negotiations under WIOA. The
Departments wish to clarify that there
are numerous methods for allocating
costs, of which a proportion of
customers is only one. One-stop
partners will negotiate MOU' s and
infrastructure funding agreements that
meet the needs of the local areas and the
partner programs.
Comments: A few commenters
objected to the funding structure
described in the NPRM, stating that
there is a discrepancy in how
contributions are calculated and how
funds are reallocated. Specifically, the
commenter suggested that the State
WDB formula—as discussed in
678. 745— redistribute funds under
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what was proposed as the State funding
mechanism in the NPRM using different
factors than what is used to calculate
proportionate share.
Departments' Response: The
Departments have determined that the
referenced discrepancy does not exist.
There will be differences in the
application of the framework for
infrastructure funding used among local
areas, but required partner programs
will have consistent requirements across
all programs. As the commenter
suggested, however, the use of the State
WDB formula as proposed in the NPRM
created ambiguities in determining what
local partner programs should
contribute. Because of this and other
comments, the formula has been
reworked to provide a more stable, and
practicable tool for the Governor to use.
These changes are detailed in § 678. 745
and the associated Preamble discussion.
Comments: A few commenters said
that contributions from partner
programs must be consistent with their
authorizing statutes and all other legal
requirements under WIOA.
Departments' Response: The
Departments agree that all required
partner programs must also comply with
the provisions of their own authorizing
statutes, in addition to WIOA, and have
determined that the regulations reflect
this requirement.
Comments: A few commenters asked
if only partners colocated within the
one-stop must contribute, or if all
partners that benefit from the centers
must also contribute.
Departments' Response: As
mentioned above, all one-stop partners
must contribute to infrastructure
funding, but will do so based upon a
reasonable cost allocation methodology
whereby infrastructure costs are charged
based on each partner' s proportionate
use of the one-stop centers and relative
benefit received. This would still apply
even if the program is not located at the
one-stop center, if it is a required
partner.
Comments: A commenter asked why
the UI system is not a mandatory
funding partner.
Departments' Response: This is an
incorrect assumption. As a required
one-stop partner under WIOA sec.
121( b)( 1)( B)( xi), a partner providing UI
services must contribute its
proportionate share of the infrastructure
costs, as is required by WIOA sec.
121( b)( 1)( A)(ii).
Comments: Another commenter
recommended that TANF should not he
required to pay infrastructure costs.
Departments' Response: As a one-stop
partner, a TANF program must provide
infrastructure cost funding according to
its proportionate use of the one-stop
centers and relative benefit received, as
is required by WIOA, unless the
Governor exercises the option not to
include TANF as a required partner. See
WIOA sec. 121(b)( 1)( C). If the Governor
has exercised the option so that an
entity carrying out a TANF program is
not a required one-stop partner, but it
chooses to become one voluntarily, the
program must provide its share of
infrastructure costs as do all required
partners. No change to the regulatory
text was made in response to this
comment.
Comments: A few commenters said
that the Departments should make it
clear that title I funds can support title
II based on the definition of "training"
in WIOA sec. 134( c)( 3).
Departments' Response: Program
funds are for the benefit of the
participants enrolled in training
authorized in that particular title. Funds
provided by partners to support
infrastructure and shared costs of the
one-stop delivery system are intended to
benefit the participants of all programs.
Guidance also has been released on the
subject in both TEGL No. 2-15,
Operational Guidance for National
Dislocated Worker Grants pursuant to
the Workforce Innovation and
Opportunity Act," and TEGL No. 04-15
Vision for the One -Stop Delivery
System under WIOA," among others, as
well as corresponding ED documents,
such as TAC -15-01 and Program
Memorandum OCTAE 15-3, which are
associated with TEGL No. 04-15. All
DOL WIOA operating guidance can be
found at http:// wdr.doleta.gov/
directives/All WIOA Related
Advisories.cfm, and all associated ED
documents may be found at
www2.ed.gov/about/ offices/ list/ osers/
rsa/ wioa-reauthorization.html and
www2.ed.gov/policy/adulted/guid/
memoranda.html.
Furthermore, an additional section of
regulatory text on this subject was
added to the DOL WIOA Final Rule at
20 CFR 680. 350. No change to the
regulatory text was made in response to
these comments.
Comments: Multiple commenters
urged the elimination of the one-stop
delivery system proposed infrastructure
payments, and some remarked that the
NFJP should be exempt from this
requirement because NFJP grantees
often operate in satellite locations in
rural areas where the communities face
transportation barriers. Some of these
commenters discussed the extensive
outreach necessary in these
communities and remarked that NFJP
grantees would not have to sacrifice
their identity or their close partnerships
with one-stop delivery systems if the
Departments allow them this
exemption.
Departments' Response: The
Departments cannot eliminate the one-
stop delivery system infrastructure
payments for any of the required partner
programs, as the infrastructure cost
contributions are required by sec.
121( b)( 1)( A)(ii) of WIOA. While NFJP
grantees are required partners and are
required to provide infrastructure
funding for the one-stop centers, they
will contribute amounts in direct
proportion to their use in accordance
with the provisions of these regulations
and Departmental guidance. No change
to the regulatory text was made in
response to these comments.
Comments: Several commenters
stated that, if deemed necessary,
infrastructure payments should be no
greater than the value received by NFJP
programs, and some commenters
suggested that in-kind contributions
should be considered as a valid form of
payment.
Departments' Response: WIOA
requires partners to contribute
infrastructure funds according to the
partners' proportionate use and relative
benefit received. The regulations allow
noncash and third -party in-kind
contributions as valid forms of payment
for infrastructure costs. The Uniform
Guidance related to in-kind
contributions applies here, and
additional guidance regarding noncash
and in-kind contributions and shared
costs has been released by the
Departments. No change to the
regulatory text was made in response to
these comments.
Comments: A commenter suggested
that NFJP grantees should continue to
be required partners on State and Local
WDBs if NFJP is forced to make a
financial contribution.
Departments' Response: The
Departments recognize that many
important system partners with
experience with specific populations—
such as certain required one-stop
partner programs, tribal organizations,
other Department program grantees, and
those serving the disadvantaged and
disabled populations—are no longer
required members of WDBs. However,
20 CFR 679. 320( c) of the DOL -only
Final Rule requires that the Local WDB
must be comprised of workforce
representatives that can include one or
more representatives of community-
based organizations that have
demonstrated experience and expertise
in addressing the employment, training,
or education needs of individuals with
barriers to employment. Further, 20 CFR
679. 320( e)( 4) says the CEO has the
55905Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
flexibility to appoint " other appropriate
individuals," which does not preclude
any organization that the CEO deems
appropriate. The Departments
encourage the CEO to ensure that Local
WDB members represent the diversity of
job seekers and employers in their local
areas, which includes ensuring adequate
representation on the Local WDB.
Section 679. 320 in the DOL WIOA Final
Rule implements the WIOA sec. 107(b)
Local WDB membership requirements.
No change to the regulatory text was
made in response to this comment.
Comments: Several commenters
addressed the Departments' request for
comment on the types of costs that
should be included as infrastructure
costs. One commenter reasoned that
staff development and training is an
appropriate use of funds to maintain the
one-stop delivery system as described in
678. 700( c). The commenter also asked
if the Departments are acknowledging
that costs described in paragraphs ( a)
and (b) are allowed by the required
program authorizing statutes. Another
commenter asked if infrastructure costs
include personnel costs such as facility
maintenance, and one commenter asked
if they include copy machine leases. A
different commenter suggested that
infrastructure costs should include one-
stop marketing, IT and communication
costs, and administrative costs of
operating one-stop centers. A couple of
commenters suggested that certain one-
stop operation personnel costs, such as
receptionist, IT support, building
security, and manager, should be
funded from infrastructure costs.
Another commenter agreed, reasoning
that if they are not, such costs would
fall on WIOA title I—B funds.
Departments' Response: Section
121( h)(4) of WIOA defines one-stop
infrastructure costs as " the
nonpersonnel costs that are necessary
for the general operation of the one-stop
center, including rental costs of the
facilities, the costs of utilities and
maintenance, equipment (including
assessment -related products and
assistive technology for individuals
with disabilities), and technology to
facilitate access to the one-stop center,
including the center' s planning and
outreach activities." This definition is
also in § 678. 700( a). The Departments
will provide additional guidance
regarding infrastructure costs, but
addressing all potential specific items of
cost that could be included or excluded
from infrastructure costs, based on this
definition, is beyond the scope of these
regulations.
WIOA allocates equitably the cost
responsibility for operating the one-stop
delivery system across partner
programs; therefore, it is not the
intention that any one partner bear a
disproportionate share of the costs. The
Departments do not agree with the
conclusion that if the costs identified by
the commenters are not included in
infrastructure costs they will fall on
WIOA title I funds. Costs that are related
to services shared by partners that do
not fall into the definition of
infrastructure costs should he treated as
other shared costs according to WIOA
sec. 121( i)( 2) and § 678. 760 of these
regulations.
Comments: One commenter stated
that infrastructure costs should be
aggregated and addressed at the State
level.
Departments' Response: It is not
possible to accomplish this by Federal
regulation. Funds are separately
appropriated to States under a variety of
authorizing statutes. The Governor, in
working with the State WDB, will
develop guidance that, among other
things, outlines a framework for
identifying infrastructure contribution
from each required partner, as discussed
in § 678. 705 of these regulations. If
consensus cannot be reached on an
infrastructure funding agreement
locally, the Governor will implement
the State funding mechanism to
determine one-stop partner
contributions, as discussed in
678. 725 through 678. 745. No change
to the regulatory text was made in
response to this comment.
Comments: A commenter expressed
support for including assistive
technology as a required infrastructure
cost.
Departments' Response: Section
121( h)(4) and § 678. 700( a)( 3) provide
that equipment, including assistive
technology for individuals with
disabilities, is an infrastructure cost.
However, neither of these provisions
describes assistive technology as a
required infrastructure cost, and the
Departments have determined that
designating any particular cost as a
required infrastructure cost is beyond
the scope of these regulations. As
previously indicated in this Preamble,
the Departments intend to issue
guidance regarding specific items of
allowable infrastructure costs and will
address one-stop center accessibility
costs in that guidance. No change to the
regulatory text was made in response to
this comment.
Comments: A few commenters
recommended that costs associated with
adopting the common identifier should
be funded by the Departments, not from
infrastructure costs. One commenter
asked for examples of common
identifier costs. Another commenter
agreed that common identifier costs
should be included as common
infrastructure costs.
Departments' Response: Costs
associated with the common identifier
may be included as infrastructure as
well, however there is no separate
source of funding to allocate from the
Federal level for common identifier
costs. Examples of common identifier
costs would be the cost of new signage,
changing material templates, and
changing electronic resources, but it
would not include any sort of
advertising campaign promoting the
one-stop center under the new common
identifier. No change to the regulatory
text was made in response to these
comments.
Comments: Several commenters
stated that infrastructure cost levels
should be set at the State level for adult
education programs, rather than
requiring local negotiations between
each adult education program and each
one-stop partner.
Departments' Response: Section
678. 415( b) of the regulation specifies
that the appropriate entity to serve as a
partner for the adult education program
is the State eligible agency or entity and
the State eligible agency or entity for
AEFLA may delegate its responsibilities
to act as a local one-stop partner to one
or more eligible providers or consortium
of eligible providers. As part of these
delegated responsibilities to serve as a
one-stop partner, a local adult education
entity would assume the roles and
responsibilities of one-stop partners
under sec. 121( b)( 1)( A), which would
include contributing to infrastructure
costs. No change to the regulatory text
was made in response to these
comments.
Section 678. 705 What guidance must
the Governor issue regarding one-stop
infrastructure funding?
Section 678. 705 includes certain
requirements for the Governor' s
guidance, including establishing roles,
defining equitable and efficient methods
for negotiating around infrastructure
costs, and establishing timelines for
local areas. These requirements are
essential to ensuring a consistent
approach to the Governors' guidance
across States. This allows for one-stop
certification, competition of the one-
stop operator, and inclusion of
infrastructure funding agreement terms
into the local State Plan in appropriate
timeframes. Based on comments
received, the Departments have
concluded that the Governor' s guidance
and technical assistance will be of
greatest value to the public workforce
system in implementing the provisions
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of the sections that follow. A detailed
discussion of the Departments'
responses to public comments received
on this section follows immediately
below.
Comments: A commenter asked
whether the Governor may dictate the
cost categories and allocation methods,
or whether the Governor may provide
flexibility to local partners in these
areas. Another commenter said that the
Departments should issue guidance on
cost sharing, allocation, and allowable
costs. One commenter recommended
that in cases where the Governor needs
to intervene to establish local
contributions, the contributions should
be supported with similar funding
sources for all contributors. Another
commenter said that guidance on
funding should allow for flexible
contributions from required partners.
Departments' Response: The
Departments have determined that the
language in § 678. 705 is consistent with
the cost principles contained in the
Uniform Guidance and those of the
authorizing statutes and, thus, provides
sufficient parameters within which to
define costs, cost allocation, and other
principles of cost sharing. For purposes
of clarity, specific references to the
Uniform Guidance have been added to
678. 705. Furthermore, paragraph (b)( 2)
also has been revised to clarify that cost
allocation should be based on
proportionate use of the one-stop
centers and relative benefit received.
The Governor may not dictate cost
categories or allocation methods that are
not consistent with the Uniform
Guidance. There are a variety of
methods to allocate costs that are
consistent with the Uniform Guidance,
for instance, based on: The proportion
of a partner program' s occupancy
percentage of the one-stop center
square footage); the proportion of a
partner program' s customers benefitting
by coming to the one-stop; the
proportion of partner program' s staff
among all staff at the one-stop center; or
the percentage of a partner program' s
use of equipment at the one-stop center.
This portion of the regulation can be
complex, and the Departments will
continue to issue guidance and provide
technical assistance to the public
workforce system.
The DOL' s previous Financial
Management Technical Assistance
Guide published for WIA remains useful
for an overview of cost allocation
methodologies. See http://
www.doleta.gov/grants/pdf/TAG_
PartLpdf and http:// www.doleta.gov/
grants/pdf/TA G_ PartllJuIy2011.pdf.
The Departments jointly will work to
update this guide and provide technical
assistance on cost allocation in the
future.
Comments: A few commenters said
there needs to be guidance for local
partners to contribute to the one-stop
infrastructure costs. The commenter
said that these costs need to be defined
as program costs.
Departments' Response: In addition to
the provisions of these regulations,
guidance for local partner contributions
will be available from Departmental
policy guidance documents, and from
the State agencies administering partner
funds. However, local required partners
and their CEOs also must recognize that
funds must be used in accordance with
the related authorizing statutes, and
consistent with the requirements of the
Uniform Guidance. While infrastructure
costs may be considered as program
costs for DOL WIOA programs—which
are primarily WIOA title I programs—
this is not the case for all local area
partner programs. Other authorizing
statutes may have differing
interpretations. Further guidance and
technical assistance is forthcoming on
this issue.
Comments: A few commenters
requested additional guidance for the
Governor to assist in establishing roles
and defining equitable and efficient
methods for negotiation. A commenter
said that the rule should give guidance
on what roles the Departments envision
to ensure that the Governors'
recommendations are appropriate.
Departments' Response: Since the
issuance of the NPRM, the Departments
have released infrastructure funding
guidance that includes roles and
responsibilities, and more guidance and
technical assistance documents will be
released throughout the operational
lifetime of the regulations. No change to
the regulatory text was made in
response to these comments.
Comments: A commenter said that
this section should refer to WIOA sec.
121, concerning infrastructure spending
ceilings for certain programs.
Departments' Response: The
Departments decline to adopt this
recommendation. While the
infrastructure funding caps for certain
programs under the State funding
mechanism are covered in § 678. 738( c),
they do not apply to contributions of
local programs pursuant to the local
funding mechanism. No change to the
regulatory text was made in response to
this comment.
Comments: A couple of commenters
said that the regulations need to provide
a " fail safe" for local areas in case the
State is not negotiating in good faith or
fails to meet the requirements of the
MOU. The commenter recommended
that this would be a plan consisting of
MOU terms and cost allocation plans
that would go into effect if either
condition above occurs.
Departments' Response: The
Departments are not authorized by
WIOA to implement a " fail safe" plan
as the commenter suggested. WIOA and
this Joint WIOA Final Rule (at
678. 750) require that the Governor
have an appeals process for the State
funding mechanism that would allow
one-stop partners to appeal a Governor' s
funding determination. In addition, 20
CFR 683. 600 of the DOL WIOA Final
Rule would include Local WDBs and
CEOs as " other interested parties" that
may file grievances under the State
established procedures required by
WIOA sec. 181( c)( 1). No change to the
regulatory text was made in response to
these comments.
Section 678. 710 How are
infrastructure costs funded?
Section 678. 710 indicates that sec.
121(h)(1)( A) of WIOA establishes two
methods for funding the infrastructure
costs of one-stop centers: A local
funding mechanism and a State funding
mechanism. Both methods utilize the
funds provided to one-stop partners by
their authorizing statutes. There is no
separate funding source for one-stop
infrastructure costs. The Departments
received no comments on this section
and made no changes to the regulatory
text.
Section 678. 715 How are one-stop
infrastructure costs funded in the local
funding mechanism?
To use the local funding mechanism,
Local WDBs, in consultation with CEOs,
must engage one-stop partners early in
discussions about one-stop center
locations, costs, and other services, so
that all parties can make decisions
cooperatively and reach consensus
about funding infrastructure costs.
WIOA does not place any limitations on
contributions under the local
mechanism; however, partner programs'
contributions must be in compliance
with their Federal authorizing statutes
and other applicable legal requirements,
including administrative cost
limitations, and represent each partner' s
proportionate share, consistent with the
Uniform Guidance. Under this section,
agreement is achieved when all of the
one-stop partners sign an MOU with the
Local WDB, which includes a final
agreement regarding funding of
infrastructure that includes the elements
listed in § 678. 755, or an interim
funding agreement that includes as
many of these elements as possible. A
detailed discussion of the Departments'
55907Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
responses to public comments received
on this section follows immediately
below.
Comments: One commenter said that
partners should pay an equitable share
of the infrastructure costs, not a
proportionate share based on relative
benefits.
Departments' Response: WIOA sec.
121(h)(1)( B)(i) and sec. 121(h)(2)( C)
specifically require funding allocations
under both the local or State funding
options to be based on proportionate use
and relative benefit received. The first
and preferred option is through methods
agreed on by the Local WDB, CEOs, and
one-stop partners. If no agreement can
be made, then the State funding
mechanism applies. Both mechanisms
are based upon Federal cost principles
contained in the Uniform Guidance. No
change to the regulatory text was made
in response to this comment.
Comments: A commenter stated that
the regulations should clarify that the
Local WDB has the responsibility for
maintaining and preparing the records
necessary to periodically review and
reconcile partner shares of
infrastructure costs against actual
expenditures to ensure equity.
Departments' Response: The
Departments disagree; specifics of the
roles and responsibilities of local
entities is something to be worked out
in the MOU, not in Federal regulation.
Additionally, MOUs are required to be
reviewed no less than once every 3
years as required by WIOA sec.
121( c)( 2)( A)(v). No change to the
regulatory text was made in response to
this comment.
Comments: Another commenter asked
for a definition of "proportionate
share." One commenter said that the
Governor should set policy regarding
proportionate benefit." Another
commenter requested guidance on
calculating proportionate use.
Departments' Response: There is no
specific Federal definition of
proportionate share, proportionate
benefit, or proportionate use, and none
of these terms are defined in WIOA. In
a general sense, proportionate share is
the share of each partner program' s
infrastructure costs based upon its
proportionate use of the one-stop
centers and relative benefit received
from that use. The concept of
proportionate share, consistent with the
partner programs' authorizing statutes
and regulations and the Uniform
Guidance at 2 CFR part 200, is used by
Federal cost principles in the Uniform
Guidance, among others. The
Departments are aware of the complex
nature of arriving at a generally
accepted method of calculating
proportionate share in a given State or
local area and will address this issue
through additional fiscal guidance and
training. No additional regulatory text is
required.
Comments: Several commenters in the
adult education field asked for guidance
regarding the duties and functions of the
Local and State WDBs in small States
and single -area States.
Departments' Response: Because
WIOA is an evolving system, there is no
standard list of all of the possible duties
and functions of Local and State WDBs.
While WIOA establishes required duties
and functions for State and Local WDBs,
discussed further in this subpart, each
State and Local WDB will develop State
and local plans that define their visions
and roles and may expand upon these
duties and functions. Pursuant to
WIOA' s Sunshine Provisions, the State
and local plans are available for public
inspection and Board meetings must be
open to the public, which ensures
transparency and accountability for all
State and Local WDBs.
Comments: A few commenters said
that the Departments should issue
guidance on simply bypassing the local
infrastructure funding process and using
the State funding process instead.
Departments' Response: WIOA does
not provide authority for bypassing the
local funding mechanism. The State
funding mechanism is only triggered
after the Governor is informed that
consensus could not be reached at the
local level.
Comments: Many commenters said
that the Departments should clarify that
both cash and in-kind contributions are
permitted in both the local and State
funding mechanisms. One commenter
asked for clarification on how in-kind
contributions should be calculated as an
alternative to direct payments. A few
commenters asked for clarification of
the phrase " fairly evaluated in-kind
contributions" and also asked to know
who makes this determination. Another
commenter said that infrastructure
funding should be cash -only. One
commenter said that the Departments
should update their guidance for in-
kind contributions to ensure that such
contributions are weighted
appropriately. A few other commenters
said that provision of alternative
communication services ( e.g., Braille,
deaf interpreters) should be considered
an in-kind contribution for the VR
program.
Departments' Response: These
comments assisted the Departments in
making certain adjustments in this part
of the regulations. WIOA sec. 121( c)( 2)
outlines the required content of the
local MOU. This includes a description
of how the costs of operation of the one-
stop delivery system will be funded.
Operating budgets for one-stop centers
encompass two types of costs that are
specifically outlined in the law:
Infrastructure costs, defined in WIOA
sec. 121(h)(4), and additional costs
relating to the operation of the one-stop
delivery system that do not constitute
infrastructure costs, described in WIOA
sec. 121( i)( 1), which includes the cost of
career services under WIOA sec.
134( c)( 2) and may include shared
services, defined in WIOA sec. 121( i)(2).
WIOA sec. 121( c)( 2)( A)(ii)(I) establishes
in-kind contributions as valid forms of
payment for operations.
The regulatory text in § 678. 715 has
been revised to clarify that cash, non-
cash, and third -party in-kind
contributions may be provided by, or on
behalf of, one-stop partners to cover
their proportionate share of
infrastructure costs and to provide
further agreement on the terms with
definitions provided in the Uniform
Guidance. These terms are further
defined in § 678. 720( c).
Non-cash contributions, which are
separate from third -party in-kind
contributions, are comprised of receipts
for current expenditures incurred by
one-stop partners on behalf of the one-
stop center and non-cash resources such
as goods or services, or the
documentation of supporting costs for
items owned by the partner' s program
and used by the one-stop center.
For example, imagine a partner' s
proportionate share of the one-stop
operating costs is $ 15, 000. The partner
does not have sufficient cash or other
resources to fund its share fully, and
wishes to donate (not for its own
individual use) gently used surplus
computer equipment. The computers at
the time of the donation have a value
determined in accordance with the
requirements of 2 CFR 200. 306 of
10, 000. The partner would be able to
use the $ 10, 000 value as part of the
resources provided to fund the shared
costs.
Third -party in-kind contributions are
contributions of space, equipment,
technology, nonpersonnel services, or
other like items to support the
infrastructure costs associated with one-
stop center operations, by a non -one-
stop partner to support the one-stop
center in general (rather than a specific
partner), or contributions by a non -one-
stop partner of space, equipment,
technology, nonpersonnel services, or
other like items to support the
infrastructure costs associated with one-
stop center operations, to a one-stop
partner to support its proportionate
share of one-stop infrastructure costs.
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There are two types of third -party in-
kind contributions: General
contributions to one-stop operations
i.e., those not connected to any
individual one-stop partner) and
specific contributions made to a
particular one-stop partner program.
For example, a general in-kind
contribution could be a city government
allowing the one-stop to use city space
rent-free. These in-kind contributions
would not be associated with one
specific partner, but rather would go to
support the one-stop generally and
would be factored into the underlying
budget and cost pools used to determine
proportionate share. The result would
be a decrease in amount of funds each
partner contributes, as the overall
budget will have been reduced.
The second type of in-kind
contribution could be a third -party
contribution to a specific partner to
support one-stop infrastructure. For
example, an employer partner provides
assistive technology to a VR program
that then gives it to the one-stop center.
So long as assistive technology was in
the one-stop operating budget' s
infrastructure costs, the partner could
then value the assistive technology in
accordance with the Uniform Guidance
and use the value to count towards its
proportionate share. Prior to accepting
in-kind contributions from a partner (via
a third -party donor), there would need
to be agreement among the partners on
cost allocation methodology to ensure
that other infrastructure operating costs
are sufficiently covered through cash
and noncash contributions.
Both non-cash and in-kind
contributions must be valued consistent
with 2 CFR 200. 306 and reconciled on
a regular basis to ensure that they are
fairly evaluated and meeting the
partners' proportionate share.
All partner contributions, regardless
of the type, must be reconciled on a
regular basis (i.e., monthly or quarterly)
to ensure each partner program is
contributing no more than its
proportionate share, in accordance with
the Uniform Guidance at 2 CFR part
200. No other change to the regulatory
text is made in response to these
comments.
Section 678. 720 What funds are used
to pay for infrastructure costs in the
local one-stop infrastructure funding
mechanism?
Section 678. 720 explains the funds
that one-stop partners may use to pay
for one-stop infrastructure costs. In
funding the one-stop infrastructure
costs, partner programs must satisfy the
requirements of their authorizing
statutes and regulations. Further, all
one-stop partners must work together to
administer the partner programs and the
one-stop and other activities of the core
programs under WIOA as efficiently and
effectively as possible. This will ensure
that, as recipients and stewards of
Federal funds for all of these programs,
the partners and their subrecipients,
when allowable under a partner
program' s authorizing statute,
administer these programs and activities
to meet all applicable legal requirements
and goals. It is important to note that the
different Federal statutes and
regulations of partner programs define
administrative costs slightly differently.
Some programs' statutes and regulations
define all of the infrastructure costs
listed in § 678. 700 as administrative
costs, while other programs' statutes
and regulations define some of the
infrastructure costs as administrative
costs, and some as program costs. Under
678. 720 of these final regulations, one-
stop partner programs must adhere to
the administrative and program cost
limitations and requirements to which
they are subject.
Several changes were made to this
section in response to public comments
received by the Departments on the
NPRM. In § 678. 720( a), language was
added clarifying that, for WIOA title I
programs, infrastructure costs may be
considered program costs. Also in
paragraph (a), a distinction was made
between title II programs and programs
authorized under the Perkins Act.
Because the proposed Joint Final Rule
had designated the State eligible agency
under the Perkins Act as the required
one-stop partner, it consequently
required that infrastructure costs be
paid from the funds reserved by the
State eligible agency for State
administrative expenses. The joint Final
Rule, instead, designates that the
Perkins one-stop partner is the eligible
recipient at the postsecondary level, or
a consortium of eligible recipients at the
postsecondary level in a local area.
Consequently, the joint Final Rule
requires that infrastructure costs under
the Perkins Act be paid from funds
available for Perkins postsecondary
recipients' local administrative
expenses, or from other funds made
available by the State. The Joint Final
Rule also changes the source of
infrastructure funding for the title II
program, specifying that these costs be
paid from the funds available for local
administrative expenses or from non -
Federal resources that are cash, in-kind
or third -party contributions.
Also the Departments added a new
paragraph (c) and associated
subparagraphs to § 678. 720 in response
to requests for further clarification,
which cover the distinctions between
and definitions of cash, non-cash, and
third -party in-kind contributions to
meet partner programs' infrastructure
costs contribution obligations. In
addition, the Departments provided
operating guidance and technical
assistance to the public workforce
system, and will continue to provide
such assistance, as needed. A detailed
discussion of the Departments'
responses to public comments received
on this section follows immediately
below.
Comments: A commenter indicated
that this section " is in error in its
implication of Perkins State
administration funding to support local
one-stop infrastructure." This
commenter asserted that directing
Perkins Act State administration is a
violation of the uses of funds for such
dollars as articulated in Perkins Act sec.
112( a)( 3). The commenter recommended
revising § 678. 720( a) to read: " In the
case of partners administering the Carl
D. Perkins Career and Technical
Education Act of 2006, these funds shall
include local administrative funds
available to local eligible institutions or
consortia of such institutions." The
commenter further stated that Perkins
Act funds are not divided among
secondary and postsecondary career and
technical education programs; the
distribution between the eligible
recipients only takes place at the local
level, and this section and § 678. 740( d)
should be revised to apply only to local -
level funding instead of the Perkins
eligible agency and the State' s
administrative dollars. Another
commenter agreed, stating that the
regulations appear to require duplicate
Perkins funds, including both State and
local Perkins administrative funds. The
commenter similarly indicated that this
is a new use of Perkins State
administrative funds. Another
commenter interpreted the intent of this
section to mean that when the Perkins
State eligible agency delegates authority
to local entities to serve as one-stop
partners, the State agency may require
the use of local administrative funds in
lieu of State administrative funds.
Departments' Response: The Joint
WIOA NPRM designated the State
eligible agency under the Perkins Act as
the required one-stop partner, and
consequently required that
infrastructure costs be paid from the
funds reserved by the State eligible
agency for State administrative
expenses. The Final Rule instead
designates that the Perkins one-stop
partner is the eligible recipient at the
postsecondary level, or a consortium of
eligible recipients at the postsecondary
55909Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
level in the local area. The Departments
have determined that this change is
consistent with WIOA sec.
121( b)( 1)( B)( iv) which designates local
one-stop Perkins partners as the entity
that carries out career and technical
education programs at the
postsecondary level, authorized under
the Perkins Act, in a local area.
However, the Departments have
concluded the State' s involvement
could be valuable at the negotiation
stage and have modified §§ 678.415(e)
and 678. 720( a) to provide that the local
recipients at the postsecondary level
may request assistance from the State
eligible agency in completing its
responsibilities in negotiating local
MOUs. To meet their obligations to
cover their proportionate share of
infrastructure costs, Perkins
postsecondary recipients may use funds
available for local administrative costs
under the Perkins Act, or draw from
other funds made available by the State,
at the State' s discretion.
Comments: A commenter stated that
Perkins funds are not divided among
secondary and postsecondary career and
technical education programs; rather,
the distribution between the eligible
recipients only takes place at the local
level, and §§ 678. 720 and 678. 740( d) of
the NPRM should be revised to apply
only to local -level funding instead of the
Perkins eligible agency and the State' s
administrative dollars.
Departments' Response: As stated
above, this comment was taken into
consideration in making the final
regulatory text changes indicating that
the Perkins one-stop partner is the
eligible recipient at the postsecondary
level, or a consortium of eligible
recipients at the postsecondary level in
the local area.
Comments: A commenter stated that
the regulations appear to require
duplicate Perkins funding, including
both State and local Perkins
administrative funds. The commenter
said that this is a new use of Perkins
State administrative funds.
Departments' Response: Perkins State
funds are no longer required to be used
to pay for infrastructure costs, as
outlined above, but may be made
available by the State, at the State' s
discretion.
Comments: A commenter said that
678. 720( a) of the NPRM limits title II
contributions to no more than five
percent of the Federal AEFLA funds
received by the State. The commenter
said that the Departments should direct
States to distribute a share of other title
II funds to local partners to pay for
infrastructure costs.
Departments' Response: The
Departments do not have the authority
to direct the States to do this. Section
233( a)( 2) of WIOA specifically provides
that up to five percent of the AEFLA
funds allocated to local eligible
providers shall be used for
administrative costs, including costs
related to the one-stop partner
responsibilities in sec. 121( b)( 1)( A).
These responsibilities include
contributing to infrastructure costs.
Under sec. 233( a)( 1), 95 percent of the
funds allocated to local eligible
providers must be used for carrying out
adult education and literacy activities.
However, under sec. 233( b), if the five
percent cost limit is too restrictive to
permit the local eligible provider to
cover the local administrative costs,
including the payment of infrastructure
costs, the local eligible provider
negotiates with the State eligible agency
to determine an adequate amount to be
used for non -instructional purposes. No
change to the regulatory text was made
in response to this comment.
Comments: A few commenters asked
if the approach described in § 678. 720( a)
would allow " the Federal funding
stream to sidestep its responsibility to
cover costs relative to the benefit
received by the program."
Departments' Response: As described
at the beginning of this section, changes
have been made to the local funding
mechanism to explain partner
responsibilities and make clear that
programs must contribute their
proportionate share based on
proportionate use and relative benefit
received.
Comments: Some commenters stated
that because WIOA sec. 121 does place
a cap on infrastructure funding for the
VR program, § 678. 720 should not state
that there is no cap on the funding a
one-stop partner may contribute.
Departments' Response: The caps on
infrastructure funding, which are
addressed in § 678. 738, apply to what
the Governor can require partner
programs to contribute under the State
funding mechanism, triggered when
local partners cannot reach consensus
on the local -funding mechanism. If a
partner program chooses to contribute
more than the cap for its program under
the State funding mechanism, it can do
so, as long as such contributions reflect
its proportionate share, consistent with
the Uniform Guidance. On the other
hand, if the State funding mechanism is
not triggered, neither WIOA sec. 121 nor
678. 720 of these final regulations
impose a limitation on how much a core
program may contribute for
infrastructure costs. No change to the
regulatory text was made in response to
these comments.
Comments: A commenter said that
infrastructure costs should use only a
portion of the available administrative
cost amount, otherwise there will be no
funds available for other administrative
costs associated with operating the
program.
Departments' Response: A one-stop
partner program' s contributions to
infrastructure costs under the local
funding mechanism is limited in that
contributions for administrative costs
may not exceed the amount available for
administrative costs under the
authorizing statute of the partner
program. In addition, the amounts
contributed for infrastructure costs must
be allowable and based on proportionate
use of the one-stop centers and relative
benefit received by the partner program,
and must be consistent with 2 CFR part
200, including the Federal cost
principles. No change to the regulatory
text was made in response to this
comment.
Comments: Another commenter
requested additional clarification on the
process and role of adult education
programs in contributing to
infrastructure costs.
Departments' Response: Upon further
review, the Departments note that sec.
233( a)( 2) of WIOA specifically provides
that adult education program local
administrative funds, rather than the
State administration funds referenced in
the NPRM, are to be used for one-stop
partner responsibilities under WIOA
sec. 121( b)( 1)( A). These responsibilities
include contributing toward one-stop
infrastructure costs. Further, while
AEFLA caps the amount that may be
used for local administrative expenses
at five percent under sec. 233( a)( 2) of
WIOA, the State adult education agency
may increase the amount that can be
spent on local administration in cases
where the cost limits are too restrictive
to allow for specified activities. This
may include funding one-stop center
infrastructure that would be part of the
one-stop partner responsibilities to be
carried out by the eligible provider in a
local area.
The NPRM permitted the State
eligible agency to use non -Federal funds
that it contributes to meeting the
program' s matching or maintenance of
effort requirements for infrastructure
costs under both the local and State -
level infrastructure funding
mechanisms. Upon further review, the
Departments have determined that
providing States and local entities even
greater flexibility to leverage non -
Federal resources to pay infrastructure
costs is appropriate.
55910 Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
The text of §§678. 720 and 678. 740
have been revised to provide that funds
for infrastructure costs for the adult
education programs under the local
funding mechanism and State funding
mechanisms, respectively, must include
Federal funds available for local
administration of the programs and non -
Federal resources that are cash, non-
cash, or in-kind or third -party
contributions.
Comments: A few commenters said
that in times of limited resources,
requiring one-stop partners to pay for
infrastructure costs out of
administrative funds could have the
effect of limiting their participation in
the one-stop delivery system.
Departments' Response: Each one-
stop partner will enter negotiations
around the MOU and infrastructure
funding agreement with the knowledge
of their budgets and the requirements of
their program statutes. The Departments
hope that all partners find that
developing a truly integrated one-stop
center system results in efficiencies and
enables partners to provide services in
a cost effective manner that allows them
to support the infrastructure costs of the
one-stop center. No change to the
regulatory text was made in response to
these comments.
Comments: A commenter expressed
support for the flexibility provided to
partners to use State or local funding
options as long as there is minimal
administrative burden. A couple of
commenters expressed support for State
and Local WDBs to have flexibility to
determine how to meet their cost
sharing requirements.
Departments' Response: The
Departments agree that these final
regulations provide flexibility to one-
stop partners in determining
infrastructure funding contributions.
Comments: A commenter asked if
there is a difference between
administrative and overall funding for
one-stop partners.
Departments' Response: As discussed
above, the Federal statutes and
regulations governing each of the
partner programs define " administrative
costs" differently; therefore, partners
must comply with program -specific
requirements governing the expenditure
of funds for such purpose.
Comments: A commenter supported
only administrative funds being used for
one-stop infrastructure costs. Another
commenter suggested that workforce
development funds should not be co -
mingled with career and technical
education funds for purposes of funding
and allocating one-stop infrastructure
costs.
Departments' Response: WIOA does
not require or authorize blending or co -
mingling of partner funds. Rather, the
local MOU and infrastructure funding
agreement will identify the
infrastructure and operating costs of the
one-stop center and develop a cost
allocation methodology to determine
each partner' s proportionate share for
both types of costs, consistent with the
Uniform Guidance set forth in 2 CFR
part 200. This process is similar to what
has been done by one-stop partners for
several years and it has been working
well among one-stop centers in many
local areas. Partners can contribute cash,
noncash, or third -party in-kind
contributions to the Local WDB to
satisfy their share. However,
infrastructure costs, unlike other shared
operating costs, do not include
personnel costs and therefore may not
be paid for with in-kind personnel time.
No change to the regulatory text was
made in response to these comments.
Section 678. 725 What happens if
consensus on infrastructure funding is
not reached at the local level between
the Local Workforce Development
Board, chief elected officials, and one-
stop partners?
The Departments have concluded that
WIOA sec. 121( h)(1)( A)(i) requires that
consensus agreement on the methods of
sufficiently funding the costs of
infrastructure be reached in
negotiations, beginning July 1, 2016.
The Departments informed the public
and all relevant parties that this section
of the WIOA regulations will not be
implemented for PY 2016. The
workforce development system was
informed of this decision through the
issuance of a Frequently Asked
Question (FAQ) that was posted on
agency Web sites on January 28, 2016
see https:// www.doleta.gov/wioa/
FAQs.cfm). The regulatory text of this
section has been revised to further
clarify these provisions and to provide
that the provisions outlined in this
section on the State funding mechanism
will be applicable to program years
beginning with PY 2017. Before that
time, State agencies of the Governor will
have issued the mechanism to follow if
a local area fails to reach a local
infrastructure funding agreement
through the process of negotiating
MOUs with the required programs.
Section 678. 725 states that failure to
sign the MOU containing the final
infrastructure funding agreement or
interim agreement by the beginning of
each program year would trigger the
State funding mechanism. This section
states that Local WDBs must notify the
Governor by the deadline established by
the Governor' s infrastructure guidance
developed under § 678. 705( b)( 3) if the
local partners cannot reach consensus.
The State will monitor the local areas to
address violations of the Governor' s
guidance. The Governor' s guidance
might establish an earlier date for
notification of a lack of consensus to the
State, or of milestones or decision
points in the negotiation process, to
ensure the uninterrupted services of the
one-stop services in the local area. A
detailed discussion of the Departments'
responses to public comments received
on this section follows immediately
below.
Comments: A commenter suggested
that the regulations should state that if
the Governor has to intervene to
establish local contributions, that the
contribution will be supported with
similar funding sources for all
contributors.
Departments' Response: The State
funding mechanism will be made public
prior to application in any local area,
and the framework used to determine
contributions is the same for all
contributors (see § 678. 730). There is no
statutory requirement in WIOA sec.
121( h) that partners contribute funds for
one-stop infrastructure costs under the
State funding mechanism from similar
sources, as the commenter recommends.
The State funding mechanism is
developed at the State— not the
Federal—level; it would not be
appropriate to accept the commenter' s
suggestion. The Departments decline to
do so.
The framework used to determine
contributions, however, would be the
same for all contributors statewide (see
678. 730). It also should be noted that,
while under the local funding
mechanism partner programs may
contribute through any funds allowed
by their authorizing statutes, under the
State funding mechanism, infrastructure
funds must come from administrative
funds for the majority of partner
programs.
Section 678. 730 What is the State one-
stop infrastructure funding mechanism?
This section— as well as §§ 678. 735
and 678. 740— has undergone significant
changes from the NPRM in both content
and structure, although the core
principles of the State funding
mechanism remain the same. Several
sections have been added to both break
the previous section into more concise
parts and to provide further clarity and
structure to the State funding
mechanism regulations, including
678. 731, which outlines the steps to
implement the State mechanism. The
Departments recognize that the State
55911Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
funding mechanism is still complex,
and further guidance regarding its
design and implementation will be
released.
As outlined in § 678.730(b)(1) through
3) of this section, the framework for the
State funding mechanism consists of
three essential steps to be performed by
the Governor once the State mechanism
has been triggered by the submission of
a notice by the Local WDB that no
consensus could be reached in the MOU
negotiations:
1) A budget must be determined for
the infrastructure costs for one-stop
centers in the local area (§ 678. 735).
2) Each partner' s proportionate share
must be determined (§§ 678. 736 and
678. 737).
3) The calculation of the required
funding caps must be made, along with
any associated reconsiderations and
adjustments to the budget or partner' s
proportionate share (§ 678. 738).
These steps are detailed in §§678. 731
and 678. 735 through 678. 738 of the
regulatory text and the associated
discussion sections below, which
include an example scenario. A detailed
discussion of the Departments'
responses to public comments received
on this section follows immediately
below. Minor changes were made to
NPRM § 678. 735( b), which covered
instances in which the Governor does
not determine the infrastructure funding
contribution for certain partners, and
this section was moved to § 678. 730( c)
of the Final Rule.
Comments: One commenter remarked
that the requirements in this section are
complex, onerous, and will be costly to
administer. Specifically, the commenter
expressed concern with (1) the annual
identification of each partner' s required
share based on proportionate use, in the
absence of a data collection system to
accurately track program participants
for each partner; (2) collecting and
accounting for the funds; ( 3) ongoing
administration, including tracking each
partner' s contributions; and (4)
periodically reviewing costs charged to
each partner to ensure they are still in
line with proportionate use and benefit.
Departments' Response: As
mentioned above, the Departments
recognize the complexities of the State
funding mechanism and have taken
steps to address this. While there will be
a cost associated with implementing the
State funding mechanism, this cost will
be mitigated by the provision of all
negotiation materials and documents
from the local area to the Governor, as
is required by § 678. 735( a).
As to the collecting and accounting
for funds, the Governor never actually
takes possession of any funds, but
instead determines a local budget in
accordance with §678. 735, as well as
partner contributions, and directs
partners to pay for their share of
infrastructure costs from the individual
partner program' s funds, as is specified
by §§ 678. 736 and 678. 737.
Furthermore, the Governor will not be
managing the local plans; the Local
WDB and one-stop operator will carry
on their duties as under any locally
reached agreement. The only difference
in the State funding mechanism is that
the Governor determines what the
infrastructure funding agreement
portion of the MOU looks like.
Comments: One commenter expressed
confusion over how the State funding
mechanism will operate. The
commenter stated that in some
provisions, it seems that the Governor
would assemble a single statewide fund
consisting of local contributions, and
then distribute them to local areas using
the formula established by the State
WDB. In other provisions, according to
the commenter, it appears that the
Governor would decide on an area -by -
area basis what the contributions from
each partner should be, and collect and
allocate those funds to that local area
only. Another commenter requested
additional clarity on how this
mechanism would work, particularly
when there is potential for conflict
between the partners. A Local WDB
requested examples of creating and
implementing the one-stop funding
provisions.
Departments' Response: The Governor
and the State WDB are required to
develop and issue guidance to be used
by the local areas in negotiating
agreements for the funding of the one-
stop delivery system, particularly
guidance about the roles of one-stop
partners and approaches to facilitate
equitable and efficient cost allocation
for infrastructure costs. The guidance, as
required by § 678. 705, also would
include the development of a State
funding mechanism that will be used
only in the event that a local area fails
to reach an agreement. As to the
collecting and accounting for funds, the
Governor never actually takes
possession of any funds, but they
instead determine a local budget in
accordance with §678. 735, as well as
partner contributions, and direct
partners to pay for their share of
infrastructure costs from the individual
partner program' s funds, as is stated by
678. 736 and 678. 737.
Section 678. 731 What are the steps to
determine the amount to be paid under
the State one-stop infrastructure funding
mechanism?
This section was not in the NPRM;
and therefore, the Departments did not
receive any comments on it directly, but
it was created in response to comments
that said the State funding mechanism
was confusing and overly complex. This
section lists the individual steps that
must be taken by the Local WDB and the
Governor in order to implement the
State funding mechanism in order to
clarify this process.
Section 678. 735 How are
infrastructure cost budgets for the one-
stop centers in a local area determined
in the State one-stop infrastructure
funding mechanism?
In response to comments pointing out
the complexity of the State funding
mechanism regulations, the original
678. 735 (" How are partner
contributions determined in the State
wasone-stop funding mechanism?")
broken up into four separate sections
and considerably expanded to provide
more assistance in explaining how this
process will work. Section 678. 735 now
covers the Governor' s determination of
the one-stop infrastructure budget under
the State funding mechanism. This
includes a requirement for the Local
WDB to provide the Governor with all
pertinent materials from the failed local
negotiations (§ 678. 735( a)), and
provisions for a Governor adopting a
budget that was agreed upon at the local
level (§ 678. 735( b)( 1) and (2)), as well as
for situations when the adoption of such
a budget would not be appropriate or is
impossible because one was never
locally agreed upon (§ 678. 735( b)( 3)). In
the case of the later situation, the
Governor must use the formula created
by the State WDB for determining the
budget, as is described in § 678. 745. A
detailed discussion of the Departments'
responses to public comments received
on proposed § 678. 735 follows
immediately below.
In this section of the NPRM preamble,
the Departments stated that Native
American programs must contribute to
infrastructure funding as required one-
stop partners and must negotiate with
the Local WDB on that contribution
amount. Upon further review, the
Departments have determined that
Native American programs are not
required to contribute to infrastructure
funding, but as required one-stop
partners they are encouraged to
contribute. Any agreement regarding the
contribution or non -contribution to
infrastructure funding by Native
55912 Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
American programs must be recorded in
the signed MOU (see WIOA sec.
121(h)(2)( D)(iv)). The Departments have
determined that the regulatory text
proposed in the NPRM is supported by
WIOA and the revised statement above
properly reflects both the regulatory text
and WIOA. As such, no change to the
regulatory text was necessary to address
this issue.
Comments: Many commenters
requested clarification on whether the
1. 5 percent cap on funding one-stop
infrastructure funds for title II is
calculated from the State administration
funds, or from the total adult education
grant. The commenters stated that if it
is 1. 5 percent of the total grant, and the
funds must be taken from the State
administration funds within the grant,
that would require 30 percent of the
State administration funds to be used
for one-stop infrastructure. The
commenters asked the Departments to
clarify that the cap is 1. 5 percent of
State administration funds, not the total
grant.
Departments' Response: The
calculation of the percentage of funds to
he used for infrastructure is from the
total State grant award. The 1. 5 percent
cap on contributions of funds from the
adult education program is a statewide
cap, as implemented in § 678. 738. In
accordance with §678. 738(b)( 1), the
Governor must ensure that the funds
required to be contributed by each
partner program in the local areas in the
State under the State funding
mechanism, in aggregate, do not exceed
the statewide cap for each program.
Thus, the amount of funds contributed
by each AEFLA partner program in the
local areas in the State, in aggregate,
cannot exceed the 1. 5 percent statewide
cap for the AEFLA program, as
calculated under § 678. 738( a). The
funds that the local AEFLA partners
contribute toward infrastructure costs
must be paid from funds that are
available for local administration or
from State or other non -Federal
resources that are cash, in-kind, or
third -party contributions.
Comments: Many of these
commenters also stated that it is not
fiscally practical for programs such as
adult education and NFJP that cover
multiple Local WDB regions to give 1. 5
percent to each Local WDB. These
commenters asked the Departments to
clarify that a local program only needs
to provide a maximum of 1. 5 percent of
its administration funds to
infrastructure costs.
Departments' Response: For the State
funding mechanism, infrastructure costs
for the adult education program
authorized by title II of WIOA must be
paid from funds that are available for
local administration or from State or
other non -Federal resources that are
cash, in-kind, or third -party
contributions. No matter the program,
be it NFJP, adult education, or other, the
percentage cap mentioned in the
comment does not apply at the local
level or to areas under the local funding
mechanism, but to the aggregate amount
of funds for local partners of a particular
program across the entire State which
are in local areas operating under the
State funding mechanism.
Comments: A commenter said that
because only postsecondary Perkins is a
mandatory partner, the 1. 5 percent cap
is the amount used for administration of
postsecondary programs and activities.
Another commenter agreed but also said
that at the State level there is no
distinction between funds available for
postsecondary programs and those
available for secondary programs.
Another commenter asked whether the
predetermined amounts are in addition
to the " fair share" allocation formulas in
678. 730.
Departments' Response: To clarify,
because only local postsecondary
Perkins programs are mandatory one-
stop partners, the 1. 5 percent cap is
calculated based upon the amount made
available by the State for postsecondary
level programs and activities under sec.
132 of the Perkins Act (distribution of
Perkins funds for postsecondary
education programs) and the amount of
funds used by the State under Perkins
Act sec. 112( a)( 3) during the prior year
to administer postsecondary level
programs and activities, as applicable.
The Departments have clarified the
regulatory text to reflect this. As a
reminder, the Final Rule designates that
the Perkins one-stop partner is the
eligible recipient at the postsecondary
level, or a consortium of eligible
recipients at the postsecondary level in
the local area. To meet their obligations
to pay infrastructure costs, Perkins
postsecondary recipients may use funds
available for local administrative costs
under the Perkins Act, or draw from
other funds made available by the State.
Comments: Some commenters
expressed support for the cap for the VR
contribution.
A few commenters stated that the
Wagner-Peyser Act and VR program do
not distinguish between administrative
and programmatic funds, resulting in
Wagner-Peyser Act programs in
particular providing a disproportionate
share of infrastructure costs. The
commenters recommended the
Departments study the allocation
percentages no later than WIOA
reauthorization in 2020.
Departments' Response: The
commenters are correct that the Wagner-
Peyser Act program does not make a
distinction between the program funds
that must be used for the provision of
services and those funds that must be
used for administrative costs.
WIOA requires partner contributions
determined through the State funding
mechanism to come from administrative
sources. The ED' s Rehabilitation
Services Administration (RSA) has
revised 34 CFR 361. 5( c)( 2)( viii) to
clarify that the definition of
administrative costs" includes those
costs associated with the infrastructure
of the one-stop delivery system,
regardless of whether the VR partner
contribution is determined through the
local or State funding mechanism (see
ED Office of Special Education and
Rehabilitative Services Final Rule, RIN
1820—AB70, Docket No. ED-2015—
OSERS-0001). Historically,
infrastructure costs were considered
administrative based upon the statutory
and regulatory provisions of the VR
program. This clarification will ensure
one-stop costs are treated in accordance
with long-standing practices in the VR
program and will ensure that similar
costs are not treated differently based
upon which funding mechanism is
utilized to determine the VR partner
infrastructure contribution.
The Departments want to make clear,
however, that each program may
contribute only an amount that does not
exceed its proportionate share in
accordance with the Uniform Guidance
set forth in 2 CFR part 200 and an
agreed-upon cost allocation
methodology developed by the one-stop
partners. In so doing, neither partner
should be paying a disproportionate
share because it would not be an
allowable cost under the Uniform
Guidance and could not be allocable to
the program. The question of studying
the allocation percentages in advance of
the WIOA reauthorization is not
pertinent to these regulations.
Comments: A few commenters said
that there is an inherent inequity among
the caps for various programs such that
some programs' contributions to
infrastructure costs, when spread across
multiple local areas and one-stop
centers, would be negligible.
Departments' Response: The
Departments want to clarify that the
statutory caps on administrative funds
apply only when the State funding
mechanism is triggered due to the
inability of one or more Local WDBs in
a State to reach consensus regarding the
funding of local one-stop centers. The
Departments encourage Local WDBs to
develop MOUs among each of the one-
55913Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
stop partners that sufficiently fund the
one-stop delivery system so that the
State funding mechanism, and hence
the funding caps, are not needed.
Because the administrative caps apply
only when the State funding mechanism
is triggered, partner programs may
contribute more than the cap amount
under the local funding mechanism.
The partners' shares may be contributed
in cash, non-cash, and, in certain
aforementioned circumstances, in-kind
contributions. However, the partners
may not contribute more than their
proportionate share.
Comments: A commenter remarked
that the Departments should provide a
more clear definition of "proportionate
benefit," as some partners may claim no
benefit from the one-stop delivery
system and therefore not contribute to
infrastructure costs.
Departments' Response: The
allocation of infrastructure costs by
partner program must be based on
methodologies that are driven by
proportionate use of the one-stop
centers and relative benefit received, as
determined by the Uniform Guidance
principles at 2 CFR part 200. The benefit
is not subjective, as the commenter
suggests, but rather the benefit is based
on a cost allocation methodology that
determines the proportion of the costs
that are allocable to the use of the
partner program at the one-stop center.
Comments: Another commenter urged
the Departments to recognize that the
Perkins Act funds systems and programs
instead of individuals, so the
proportionality determination will be
difficult to implement because there are
no data to determine relative benefit on
a per -student basis.
Departments' Response: The
allocation of infrastructure costs by
partner program must be based on
methodologies that are driven by
proportionate use of the one-stop
centers and relative benefit received, as
determined by the Uniform Guidance
principles at 2 CFR part 200. When
making this determination, the
calculation is per -program, rather than
per -individual. The Departments do not
conclude that the fact that Perkins funds
systems and programs, rather than
individuals, will present an issue for
Governors when making this
determination. In addition, the
Governor has discretion to determine a
reasonable cost allocation methodology
provided that the calculation of
proportionate share is consistent with
the Uniform Guidance in 2 CFR part
200, particularly that all costs charged
to partners, including Perkins partners,
are in proportion to use of the one-stop
center, and constitute allowable,
reasonable, necessary and allocable
costs. No change to the regulatory text
was made in response to this comment.
Comments: One commenter hoped the
funding obligations for a particular
program are determined in the context
of program resources and any in-kind
support the one-stop receives from
program participants.
Departments' Response: Infrastructure
funding contributions are either
determined using the local or State
mechanism. Under each, the
proportionate share principle is key; the
partners should be contributing an
amount proportionate to their use of the
one-stop center. Determining this under
the local mechanism is completely left
up to the local partners and Local WDB
to work out in the MOU, as long as it
follows the Federal cost principles of
the Uniform Guidance. Under the State
mechanism, specific language in
678. 737(b)( 2) requires the Governor to
take into consideration program
resources in determining proportionate
share. Under both mechanisms, third -
party in-kind contributions are
acceptable contributions to
infrastructure funding, as is detailed in
678. 720. No change to the regulatory
text was made in response to this
comment.
Comments: One commenter asserted
that there would be many
administrative difficulties for Wagner-
Peyser Act contributions if they are
required to be calculated on a fiscal year
basis, because Wagner-Peyser Act funds
are provided on a program year basis.
Departments' Response: The
Departments want to make clear that
there is no requirement in WIOA or
these final regulations that the one-stop
delivery system be funded on a fiscal
year, as the commenter seems to
suggest. Many of the required partners
are funded on different fiscal periods
e.g., some are funded on a program year
basis while others are funded on a
Federal fiscal year basis); so, accounting
methodologies will have to be employed
to resolve such differences.
Comments: A commenter encouraged
the Departments to clarify their
guidelines for infrastructure cost
sharing, including in-kind
contributions, and the use of
administrative vs. program funds.
Departments' Response: The
Departments acknowledge that guidance
will assist stakeholders in the public
workforce system with understanding
how to negotiate infrastructure cost
sharing agreements and understand
other aspects of funding the one-stop
delivery system, such as in-kind
contributions and the allocation of
costs. Some of this guidance is currently
available in the form of TEGLs on a
variety of subjects, such as, the
Operational Guidance to Support the
Orderly Transition of Workforce
Investment Act Participants, Funds, and
Subrecipient Contracts to the Workforce
Innovation and Opportunity Act" ( TEGL
No. 38-14), " Workforce Innovation and
Opportunity Act Transition Authority
for Immediate Implementation of
Governance Provisions" ( TEGL No. 27-
14), " Vision for the One -Stop Delivery
System under the Workforce Innovation
and Opportunity Act (WIOA)" ( TEGL
No. 4- 15), " Guidance on Services
Provided through the Adult and
Dislocated Worker Program under the
Workforce Innovation and Opportunity
Act (WIOA or Opportunity Act) and
Wagner Peyser, as Amended by WIOA,
and Guidance for the Transition to
WIOA Services" ( TEGL No. 3-15),
Workforce Innovation and Opportunity
Act (WIOA) Youth Program Transition"
TEGL Nos. 23-14 and 8-15), among
others. All DOL WIOA operating
guidance can be located at
www.doleta.gov/wioa, and all associated
ED documents may be found at
www2.ed.gov/about/ offices/list/ osers/
rsa/ wioa-reauthorization.html and
www2.ed.gov/policy/adulted/guid/
memoranda.html.
In addition, cost principle guidance is
provided in the Uniform Guidance at 2
CFR part 200 on the use of Federal
funds, and in the existing financial
Technical Assistance Guide (TAG)
handbooks previously issued by DOL,
which are still applicable to WIOA (see
http:// wdr.doleta.gov/directives/All_
WIOA_Related Advisories.cfm).
Nevertheless, the Departments'
intention is to continue to provide
system guidance and technical
assistance on all aspects of WIOA
throughout the life of this authorizing
legislation.
Comments: A commenter said that for
the TANF program, the cap of 1. 5
percent of the Federal funds provided to
carry out that education program or
employment and training program"
should instead state " education program
or employment and training activities."
The commenter also urged the
Departments to clarify that " education
program" only refers to the TANF funds
used to serve adults or teen heads of
households in needy families, not
dependent children in low-income
households.
Departments' Response: The addition
of § 678. 738( c)( 5) provides that for
purposes of TANF, the cap on
contributions is determined based on
total Federal TANF funds expended by
the State for " work, education, and
training activities" during the prior
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Federal fiscal year as reported by States
to HHS on the Quarterly TANF
Financial Report form (and associated
administrative expenditures).
Section 678. 736 How does the
Governor establish a cost allocation
methodology used to determine the one-
stop partner programs' proportionate
shares of infrastructure costs under the
State one-stop infrastructure funding
mechanism?
This new section was created from
portions of proposed § 678. 735 in the
NPRM in response to comments
regarding the complexity of the State
funding mechanism. The new § 678. 736
details how the Governor is to establish
a cost allocation methodology for
determining partner programs'
proportionate shares of one-stop
infrastructure costs. The idea that
partner programs should make
contributions to infrastructure costs that
are proportionate to the benefit they
receive from one-stop centers is central
to the funding of the one-stop delivery
system under WIOA. There are a variety
of methods that may be used—e.g.,
square footage occupied, number of staff
present, number of people served—to
make the determination of partner
programs' proportionate share. It is
important that the Governor choose a
methodology that is consistent with the
requirements of the Uniform Guidance
found at 2 CFR part 200.
Section 678. 737 How are one-stop
partner programs' proportionate shares
of infrastructure costs determined under
the State one-stop infrastructure funding
mechanism?
This new section is another created
from the NPRM' s proposed § 678. 735 in
response to comments regarding the
complexity of the State funding
mechanism, and details the steps that
should be taken by the Governor to
determine partner programs'
proportionate share of the one-stop
infrastructure costs. In addition to the
methodology determined in § 678. 736,
678. 737(b)( 2) states that the Governor
must take into account a number of
factors, including the costs of
administration of the one-stop delivery
system for purposes not related to one-
stop centers for each partner, costs
associated with maintaining the Local
WDB or information technology
systems, as well as the statutory
requirements for each partner program,
all other applicable legal requirements,
and the partner program' s ability to
fulfill such requirements. The Governor
may also take into account the extent to
which proportionate shares were agreed
upon in the failed local negotiations, as
well as any other elements of the
negotiation process provided to the
Governor per § 678. 735( a).
Section 678. 738 How are statewide
caps on the contributions for one-stop
infrastructure funding determined in the
State one-stop infrastructure funding
mechanism?
This is the final new section created
from proposed § 678. 735 in response to
comments regarding the complexity of
the State funding mechanism, covering
the caps that apply to program funding
that can be designated by the Governor
as one-stop infrastructure funding.
Paragraph (a) of § 678.738 is a step-by-
step instruction on how the Governor is
to calculate the cap for each program.
First, the Governor determines the
maximum potential cap amount in the
State by determining the amount of
Federal funds provided to the State to
carry out a one-stop partner program for
the applicable fiscal year multiplied by
the cap percentage applicable to that
program under paragraph (c) of
678. 738. Second, the Governor selects
a factor or factors that reasonably
indicates the use of one-stop centers in
the State ( such as the total population).
The Governor then determines the
percentage of that factor applicable to
the local areas that reached consensus
under the local funding mechanism (for
example, 70 percent of the State
population resides in those areas). This
percentage is applied to the amount of
the maximum potential cap. The
resulting amount ( 70 percent of the
maximum potential amount) is then
deducted from the maximum potential
cap amount to produce the applicable
cap amount for the local areas subject to
the State funding mechanism. This
approach recognizes that the statewide
caps only apply to those local areas that
do not reach consensus, and are not
applicable to the local areas that reach
agreement. Therefore, the actual
amounts of infrastructure agreed to in
those local areas that reach agreement
should not affect the cap amounts
available to those local areas that do not
reach agreement. Instead, the applicable
cap is determined by selection and
application of a factor or factors that
would reflect the relative expected use
of one-stop centers in the local areas
subject to the cap.
Paragraph (b) details the requirement
that, in aggregate, a program statewide
does not exceed the caps, including
only those local partner programs in
areas under the State funding
mechanism (§ 678. 738( b)( 1)), as well as
the steps to be taken in the event that
the proportionate share of a partner
causes a program' s aggregate
infrastructure funding to exceed the cap
678. 738(b)( 1) through (4)).
Paragraph (c) of § 678.738 sets out the
specific limitations put on infrastructure
funding from each program, and
678. 738( d) gives instructions on
calculating the caps for programs for
which it is not feasible to determine the
amount of Federal funding used by the
program until the end of the fiscal or
programmatic year. While the
methodologies of these programs
somewhat differ in application, the
methodologies for the CSBG and TANF
programs are similar to that used for the
Perkins program because in each case
the State is asked to make a
determination regarding the amount of
administrative costs that are related to
relevant education, employment, and
training activities carried out within the
respective program.
The following is an example scenario
to determine one partner program' s cap:
Partner Program A (a WIOA formula
program) receives [x]—in this example,
30 million—to carry out its program in
the State in the applicable year. There
are seven local areas in the State, two of
which have not been able to reach
consensus through the local funding
mechanism. Because Partner Program A
is a WIOA formula program, the
limitation percentage [ p] given in
678. 738( c)( 1) is applied to the Federal
dollars received in total by the program
statewide. The example below uses
three percent for [p], resulting in a
maximum potential cap of $900,000 [ y].
The maximum potential cap [y] is
calculated by multiplying the program
dollars [x] by the percentage [p], in this
example yielding $900, 000.
px = y
03 x 30, 000, 000 = 900, 000
The Governor then selects a factor [f]
that reasonably indicates the use of one-
stop centers in the State— such as total
population. The Governor then
determines the percentage of the total
population that resides in the local areas
that have reached agreement. In this
example, local areas that have reached
agreement represent 70 percent of the
State' s total population. Next the
Governor applies this percentage to the
maximum potential cap [y], $900,000,
giving the amount of these dollars
represented by the local areas in
agreement [z]: $630,000.
fy= z
0. 7 x 900,000 = 630,000
Finally, the Governor subtracts this
amount [z], $630,000, from maximum
potential cap [y], $900,000, giving the
amount of the cap to be used for those
two areas under the State funding
mechanism [ c], $ 270, 000.
55915Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
cy —z=
900,000 — 630,000 = 270,000
This means that the aggregate of the
infrastructure contributions made by the
two local partner programs in local
areas operating under the State funding
mechanism must not exceed $ 270, 000.
This calculation must then be done for
all the other partner programs in those
local areas.
For the VR program, WIOA sec.
121( h)(2)( D)( ii)(III) and § 678. 738( c)( 3)
establishes the limitations for the
amount the VR program can be required
to contribute toward the funding of the
one-stop delivery system' s
infrastructure costs. In the first year that
the State funding mechanism could be
applicable— e.g., PY 2017 beginning July
1, 2017 ( see explanation above)— the VR
program may contribute no more than
0. 75 percent of the State' s FY 2016 VR
allotment (see sec.
121( h)(2)( D)( ii)(III)(aa)). If a local area
fails to reach an agreement for purposes
of PY 2018, the VR program cannot be
required to pay more than one percent
of its FY 2017 VR allotment (see sec.
121( h)(2)( D)( ii)(III)(bb) of WIOA). If a
local area fails to reach agreement for
purposes of PY 2019, the VR program
cannot be required to contribute more
than 1. 25 percent of its FY 2018 VR
allotment (WIOA sec.
121( 2)( D)( ii)(III)(cc)). Finally, if a local
area fails to reach an agreement for PY
2020 and all subsequent years, the VR
program cannot be required to
contribute more than 1. 5 percent of its
FY 2019 or, as appropriate, any
subsequent year' s VR allotment (WIOA
sec. 121( h)(2)( D)( ii)(III)(dd)). In States
where there are two VR agencies ( a
general agency and a blind agency), the
combined contribution from these
programs cannot be required to exceed
the cap, which is based on the total VR
allotment to the State. In addition to this
specific funding limitation, each
program, including the VR program,
must comply with the requirements of
the program' s authorizing statute, all
other applicable legal requirements, and
the requirements in this subpart when
contributing funds to cover one-stop
center infrastructure costs.
In determining the maximum amount
that a VR program could contribute
toward the one-stop infrastructure costs
under the State funding mechanism, the
Governor would first have to determine
the amount of the VR allotment to the
State for the applicable year as
described above. Because the allotment
amount to any given State could change
throughout a Federal fiscal year due to
reductions made for maintenance of
effort deficits, funds returned for
reallotment to other States, and
additional funds received by a State in
reallotment, a Governor should base the
limitations for infrastructure costs on
the final VR allotment amount for the
State for the applicable Federal fiscal
year (WIOA sec. 110 and 111 of the
Rehabilitation Act, as amended by title
IV of WIOA). The final VR allotment for
any Federal fiscal year may not be
determined until September 30 of that
fiscal year. Prior to that time and for
planning purposes, the Governor can
use historical data to estimate or project
its contributions. However, these
fluctuations of the VR allotment in any
particular Federal fiscal year should not
affect the VR program' s percentage that
can be attributed to the infrastructure
costs under the State funding
mechanism because the final VR
allotment for any year would be known
well before the implementation of the
State funding mechanism for any
applicable program year.
It is important to note that WIOA sec.
121( h)(2)( D)( ii)(III) refers to a program
year (July 1 through June 30), not a
Federal fiscal year (October 1 through
September 30). However, because the
VR program funds are provided to a
State on a Federal fiscal year basis, the
Departments have interpreted " program
year" in this context, for purposes of
determining the VR program' s funding
limitations, as meaning the funds
provided to the State to operate the VR
program in a Federal fiscal year.
As this section did not exist in the
NPRM, the Departments did not receive
any comments that directly refer to it,
but did receive comments referring to
some of the contributing material,
which are discussed under § 678.635 of
the Final Rule part 678 discussion.
Section 678. 740 What funds are used
to pay for infrastructure costs in the
State one-stop infrastructure funding
mechanism?
This section describes the funding
sources that are used under the State
funding mechanism by WIOA title I
programs, adult education programs, the
Carl D. Perkins program, and other
WIOA authorized programs. Changes
were made in response to comments to
678. 740( d), which addresses Carl D.
Perkins program infrastructure funding
sources. Because the State is no longer
the default Perkins program partner, the
Departments' modified this section to
state that Perkins postsecondary
recipient one-stop partners may use
funds available for administrative
expenses to pay infrastructure costs and
that these funds may be supplemented
by any additional funds the State
chooses to make available. A detailed
discussion of the Departments'
responses to public comments received
on this section follows immediately
below.
Comments: A commenter expressed
concern that § 678. 740( d) implies an
incentive for local areas to fail to
develop a local MOU, as defaulting to
the State funding mechanism could
result in local areas gaining access to
State administrative funds. The
commenter suggested that the
Departments should revise this
paragraph to clarify that this is not the
case, particularly with regard to Perkins
funds, and also revise other paragraphs
in the State funding mechanism sections
to emphasize local contributions.
Departments' Response: As stated
above, § 678. 740( d) has been reworded,
which has taken the emphasis away
from State funds and put more on local
entities funding infrastructure costs. No
further change to the regulatory text is
being made in response to this
comment.
Comments: Another commenter made
the opposite argument, saying that
because this section is about a State
funding mechanism, State funds should
he used. The commenter also said that
in cases where the local Perkins partner
is entering into an MOU in the local
funding mechanism option, the
regulations should clarify that no local
recipient is required to contribute more
than the cap percentage (e.g., 1. 5
percent) in local administrative funds if
other partners in that local area are
unable to negotiate an MOU and the
State process is used for those partners.
Departments' Response: As the State
is no longer the default Perkins partner,
the suggested course of action no longer
applies to the situation. No change to
the regulatory text was made in
response to this comment.
Comments: A commenter said that
Combined State Plan partner programs
such as TANF would be limited to the
administrative funds at their disposal.
Another commenter said that as long as
the costs of Senior Community Service
Employment Program ( SCSEP) funds
spent on participants and enrollees
assigned to the one-stop is counted
toward the cost allocation, the
regulations will minimize the impact on
this program.
Departments' Response: The TANF
program is not a Combined State Plan
partner program in the one-stop delivery
system, but rather it is a required
partner pursuant to WIOA sec. 121( b)
unless exempted per sec. 121( b)( 1)( C).
The SCSEP program is a required
partner and must contribute to the
infrastructure costs of the local one-stop
delivery system. The allocation
55916 Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
methodology agreed upon by the partner
programs or the Governor may include
participant counts served by the one-
stop center. No change to the regulatory
text was made in response to this
comment.
Section 678. 745 What factors does the
State Workforce Development Board use
to develop the formula described in
Workforce Innovation and Opportunity
Act sec. 121( h)(3)( B), which is used by
the Governor to determine the
appropriate one-stop infrastructure
budget for each local area operating
under the State infrastructure funding
mechanism, if no reasonably
implementable locally negotiated
budget exists?
This section also underwent
significant changes in response to
public comments received that stated
that the State WDB formula provisions
were confusing, overly complicated, and
could violate authorizing statutes. In
order to reduce the confusion centered
around the formula, step-by-step
instructions are provided on how to
apply the formula when a locally
negotiated budget does not exist. The
new provisions only require the use of
the formula in specific situations
regarding the determination of the one-
stop budget by the Governor (i.e., when
the Governor cannot, or has chosen not
to, accept a locally agreed upon one-
stop budget). The formula is to identify
factors and the associated weights of
these factors that the Governor must
consider when determining the one-stop
budget under these situations. Included
in these factors are those statutorily
required by WIOA and any other factors
related to the operation of the one-stop
delivery system that the State WDB sees
as appropriate. A detailed discussion of
the Departments' responses to public
comments received on this section
follows immediately below.
Comments: A commenter asked how
a redirection of Federal funds from one
program to another will not negatively
impact the calculation of the Perkins
Act' s ` maintenance of effort' provisions
or Federal `supplement not supplant'
provisions." The commenter said that
these provisions would likely be
violated if any Perkins State
administrative funds are redirected to
one-stop infrastructure.
Departments' Response: Because of
changes to this provision, the
commenter' s concerns regarding Perkins
State administrative funds are no longer
applicable. Additionally, partner
contributions must not exceed the
partner' s proportionate share.
Comments: Likewise, the commenter
stated that the Departments need to
ensure that the reallocation formula in
this part ensures that local Perkins
funds return to the local area from
which they were derived in order to
adhere to the within -State allocation
formula of the Perkins Act, sec.
132( a)( 2).
Departments' Response: Again,
because of the changes to the formula
provision, that is that the Governor will
never actually collect and re -allocate
funds, this commenter' s concerns are no
longer applicable.
Comments: A commenter said that
678. 745 should include a descriptor of
the type of one-stop center (e.g.,
comprehensive, affiliate, satellite) in the
funding formula policy.
Departments' Response: The formula
applies to all one-stop center and
affiliated sites under the State
mechanism where the Governor has not
accepted a locally agreed upon budget.
Therefore, it is not necessary to specify
the type of one-stop center.
Section 678. 755 What are the required
elements regarding infrastructure
funding that must be included in the
one-stop Memorandum of
Understanding?
Comments: A couple of commenters
urged the Departments to encourage
shared staffing for similar partner
positions (e.g., business development).
These commenters said that
encouraging partnerships beyond
infrastructure could avoid duplication
of efforts, particularly with respond to
employer services.
Departments' Response: The
Departments encourage the partners to
consider all available means of
integration at the one-stop centers,
thereby improving the effectiveness and
efficiency of the partner programs in the
one-stop delivery system. There is
nothing in WIOA or these final
regulations that prohibit partner
programs in sharing certain key staff
positions. However, the Departments
caution that such sharing of staff would
necessitate the retention of adequate
records supporting the allocation of
personnel costs between the programs,
which also must be consistent with the
Uniform Guidance. Furthermore, the
Departments reiterate that the sharing of
staff will not be considered an
infrastructure cost, but it may be paid
with other funds in accordance with
WIOA sec. 121( i).
Section 678. 760 How do one-stop
partners jointly fund other shared costs
under the Memorandum of
Understanding?
The Departments added paragraph (c)
to explain that contributions to the
additional costs related to operation of
the one-stop delivery system may be
cash, non-cash, or third -party in-kind
contributions. This addition is
consistent with the changes made in
678. 720( c). As a result the remaining
paragraphs were renumbered.
Comments: Multiple commenters
expressed confusion about whether the
1. 5 percent spending cap for
infrastructure costs for the title II
program includes the joint contribution
to funding the costs of career services.
One commenter recommended that it
include the cost of career services so
that more funds are available to provide
AEFLA services.
Departments' Response: Contribution
to shared cost including career services
are separate from contributions for
infrastructure cost and thus the 1. 5
percent cap on contributions does not
apply to shared cost.
Comments: Two commenters
requested a definition of " additional
costs relating to the operation of the
one-stop delivery system." Another
commenter asked whether this phrase
includes the cost for the one-stop
operator.
Departments' Response: The
Departments will not define additional
costs. By allowing States to define
additional costs, they will be in a better
position of assisting their local areas in
meeting the demand and challenges of
operating a one-stop delivery system.
No change to the regulatory text was
made in response to these comments.
7. One -Stop Certification (20 CFR Part
678, Subpart F [ 678. 800]; 34 CFR
361. 800; 34 CFR 463. 800)
Subpart F of part 678 implements the
requirements in WIOA sec. 121( g) that
the Local WDB certify the one-stop
center every 3 years. The certification
process is important to setting a
minimum level of quality and
consistency of services in one-stop
centers across a State. The certification
criteria allow States to set standard
expectations for customer -focused
seamless services from a network of
employment, training, and related
services that help individuals overcome
barriers to becoming and staying
employed.
The one major change to this section
from what was published in the NPRM
was made in response to comments
regarding the use of the provision of
services beyond regular business hours
as a certification factor for one-stop
centers. While the Departments have
retained this as a certification criterion,
the language has been changed at
678.800(b) to make the consideration
of this factor conditional on the Local
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WDB determining that there is a need in
the local area for such an extension of
service hours. The Departments also
would like to assure readers that it is
highly unlikely that a one-stop center' s
certification would hinge on such a
factor, as there are many criteria that
must be taken into account in the
certification process.
Section 678. 800 How are one-stop
centers and one-stop delivery systems
certified for effectiveness, physical and
programmatic accessibility, and
continuous improvement?
General Comments About One -Stop
Certification
Comments: Several commenters
addressed the proposed timelines for
one-stop certification and updates to the
evaluation criteria. A commenter stated
that the proposed timelines could
conflict or overlap. A few commenters
suggested that all reviews should be on
a 4 -year cycle. A few State and Local
WDBs recommended that the
certification criteria be updated every 3
years to match the certification process.
A few commenters asserted that it is
impractical for all Local WDBs to
update the local additional certification
criteria every 2 years as part of the local
plan update process. Another
commenter suggested that both
timelines should be event -dependent.
Departments' Response: The
Departments have made no substantive
changes to this section other than the
changes to § 678. 800( a)( 1) and (b)
discussed below. The timelines related
to one-stop certification are statutory:
Certification every 3 years from WIOA
sec. 121( g)( 1) and updated criteria every
2 years from WIOA sec. 121( g)( 5).
However, the regulations require
certification " at least" every 3 years,
and Local WDBs may certify more often
if it helps align timelines with other
efforts. No change to the regulatory text
was made in response to this comment.
Comments: One commenter asserted
that giving Local WDBs the authority to
certify one-stop centers creates a
conflict of interest. Another commenter
stated that Local WDBs that are one-stop
operators are currently permitted to
certify themselves.
Departments' Response: The
Departments agree that Local WDBs
should not certify themselves but have
not made changes to this section as
678. 800( a)( 3) already stated that State
WDBs must certify one-stop centers
when the Local WDB is the one-stop
operator.
Comments: A commenter suggested
that the Departments should provide
guidance to State WDBs on developing
objective criteria and training or
assistance the State WDBs can share
with Local WDBs on implementing
certification procedures.
Departments' Response: On August
13, 2015, the Departments issued a joint
vision for the implementation of
American Job Centers as TEGL No. 04-
15, and have released other technical
assistance materials since then as well.
All of these guidance documents and
other pieces of guidance relating to
WIOA may be found at http://
wdr.doleta.gov/ directives/All_WIOA_
Related_Advisories.cfm, www2.ed.gov/
about/offices/list/osers/rsa/ wioa-
reauthorization.html, and www2.ed.gov/
policy/adulted/guid/memoranda.html.
The Departments' staffs continue to
remain available for technical
assistance.
Comments: A commenter stated that
the State Plan should define the
certification process for the one-stop
delivery system.
Departments' Response: The State
Plan may include the one-stop
certification process if a State wishes to
include it, but the Departments do not
consider it appropriate or necessary to
require such an inclusion in the State
Plan. No change to the regulatory text
was made in response to this comment.
Comments: Another commenter
recommended that certification criteria
focus on system performance instead of
program performance; effective
communication and data sharing across
systems while safeguarding information;
and availability of diverse and necessary
resources at one -stops.
Departments' Response: States that
wish to focus on certain aspects of one-
stop center quality can establish criteria
for those aspects, but the statutorily
required criteria at WIOA sec. 121( g)( 2)
must be included. The State WDB-
established criteria create a baseline of
consistency across the State, and States
can establish policies about processes
and methods. No change to the
regulatory text was made in response to
this comment.
Comments: A few commenters
suggested that the State WDB should
consult with Local WDBs when
updating certification criteria.
Departments' Response: The
Departments agree and have revised
678. 800( a)( 1) to clarify that the State
WDB must consult with chief elected
officials and Local WDBs when it
reviews and updates criteria, not only
when it establishes criteria.
Comments: A few commenters
requested flexibility for States to
determine the certification method,
while other commenters stated that all
Local WDBs should use the same
process to certify one -stops.
Departments' Response: While all
Local WDBs within a State must use the
State required certification criteria,
WIOA sec. 121( g)( 3) allows Local WDBs
to establish additional criteria to be
used in that local area as well. The
Departments have concluded that Local
WDBs should be able to choose the
process for certifying one-stop centers
that works best for each local area. No
change to the regulatory text was made
in response to these comments.
Comments: A commenter asked
whether the State WDB has discretion to
determine the method of certification,
and whether the State WDB can delegate
the certification process.
Departments' Response: The State
WDB does not certify, but it must set the
certification criteria. The Departments
have determined that this responsibility
is an important strategy to establish
quality one-stop centers and have not
incorporated the suggestion to allow the
State WDB to delegate it. The State WDB
must approve the final certification
criteria.
Comments: Another commenter asked
whether the intent is to certify each one-
stop center or the local area one-stop
delivery system.
Departments' Response: WIOA sec.
121( g)( 4) and this section of the
regulation state that the Local WDB
must certify one-stop centers, not the
one-stop delivery system. Although the
same criteria used to make this
certification are to be used in evaluating
a local area' s one-stop delivery system,
there is no certification process for the
one-stop delivery systems themselves,
only the one-stop centers that together
make up the one-stop delivery system.
Comments: A few commenters asked
what would happen if the one-stop
center does not meet the evaluation
criteria or get certified.
Departments' Response: Paragraph (d)
of § 678. 800 and WIOA sec. 121( g)( 4)
state that local areas that do not certify
their one-stop centers are not eligible to
use infrastructure funding under the
State infrastructure option until such
certification is complete. Local WDBs
can consider ramifications for failing
one-stop certifications in their one-stop
operator contracts.
Comments: One commenter asked
whether technical assistance will be
provided to one-stop centers that fail
certification.
Departments' Response: States may
provide technical assistance to one-stop
centers that fail certification or to any
other one-stop center that may require
or ask for it.
55918 Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
Evaluations of Effectiveness
Comments: Several commenters
expressed concern regarding the
requirement to include the provision of
service outside of regular business hours
as a factor to be considered when
evaluating one-stop center effectiveness,
stating that many one-stop centers may
not be able to provide such services and
that an inability to do so should not
count against them.
Departments' Response: The
Departments considered these concerns,
and have determined that this should
still remain one of the many factors to
be considered in evaluating one-stop
center effectiveness. Paragraph (b) of
678. 800, however, was revised to
include that the consideration of this
factor is conditional on whether the
applicable Local WDB has determined
there is a workforce need for the
provision of service outside of regular
business hours. The Departments stress
that this is one of many factors to be
taken into account when evaluating
effectiveness, and that it is very unlikely
that a one-stop center will fail to qualify
for certification solely for not providing
services outside of regular business
hours.
Comments: Several commenters
remarked that the NPRM' s inclusion of
customer satisfaction in the evaluation
of a one-stop center' s effectiveness goes
beyond what is included in WIOA. The
commenters stated that, while this is an
important measure, it is not necessarily
a measure of effectiveness, and it is also
subjective.
Departments' Response: This
provision is supported by the statutory
requirement to consider how well a one-
stop center meets the workforce
development needs of local employers
and participants in WIOA sec.
121( g)( 2)( B)( iii). The Departments have
determined that reviewing customer
satisfaction is an important part of
knowing whether services to employers
and participants are effective and meet
their needs, and will aid one-stop
operators, Local WDBs, and State WDBs
in the continued improvement of the
one-stop delivery system required by
WIOA. For this reason, the Departments
have not removed this requirement from
the regulations. No change to the
regulatory text was made in response to
these comments.
Comments: Another commenter stated
that Local WDBs could assess customer
satisfaction through surveys centered on
the one-stop center' s responsiveness to
the needs of employers and customers,
the availability and quality of
workshops, and the repeat usage over a
period of time.
Departments' Response: The
regulations are not specific on how
customer satisfaction must be measured
and the Departments have concluded
that State WDBs and Local WDBs can
determine how best to include it as a
component of a one-stop certification
criteria.
Comments: Two commenters said that
the proposed performance
accountability metrics already address
customer satisfaction.
Departments' Response: To clarify,
the proposed accountability metrics
concerning customer satisfaction and
the requirements in § 678. 800 related to
customer satisfaction are referring to the
same mechanism. This section gives the
requirement to review and apply the
customer satisfaction data to measure
the effectiveness of one-stop centers; the
actual measure, its technical aspects,
and the timing of the data collection are
outlined in § 677. 160 ( see Joint WIOA
Final Rule).
Comments: A few commenters
asserted that the most efficient and
effective systems are where the Local
WDB is the one-stop operator.
Departments' Response: The
Departments have determined that
regular measurements of effectiveness
and efficiency will assist States in
determining the most effective one-stop
operator, including whether it is
effective and efficient for a Local WDB
to be the operator.
Evaluations of Accessibility
Comments: Several commenters
expressed support for the Departments'
dedication to ensuring accessibility to
individuals with disabilities. A few
commenters also stated that the
requirement for one-stop centers to be
programmatically and physically
accessible should be reiterated in this
part.
Departments' Response: The
Departments agree and have updated
678. 800( e) to clarify that all one-stop
centers must be programmatically, as
well as physically, accessible.
Comments: A few commenters also
suggested that the language on programs
being in integrated settings should be
stronger and use the phrase " in an
integrated setting" rather than " in the
most integrated setting appropriate."
The commenters also stated that
programs should be in community-
based settings.
Departments' Response: The
Departments have retained the phrase
in the most integrated setting
appropriate" to describe our
expectations for integrated and
community-based settings in order to
remain consistent with WIOA sec. 188
and the Americans with Disabilities Act.
Comments: One commenter stated
that the Departments should provide
full accessibility and be in full
compliance with civil rights laws, the
Americans with Disabilities Act, and
secs. 504 and 508 of the Rehabilitation
Act. The commenter further stated that
one-stop operators should have
additional training on the importance of
full accessibility to individuals with
disabilities for all services.
Departments' Response: The
Departments are fully committed to
accessibility and adhering to civil rights
laws. The regulation reiterates the
requirement for full accessibility in
678.800( e), 678.305, and 678.310.
The Departments have provided, and
will continue to provide, technical
assistance on accessibility. No change to
the regulatory text was made in
response to this comment.
Comments: Another commenter stated
that there should be transparency in
reporting States' performance in
physical and programmatic access.
Departments' Response: The DOL
currently is conducting a study of
accessibility in one-stop centers, which
will be published and made available to
the public when completed in the
summer of 2016. Potential violations of
civil rights laws, including the
inadequate provision of programmatic
and physical accessibility, are
investigated by DOL' s Civil Rights
Center, which may share major findings
with the public. States also can improve
transparency by making certification
results public.
Comments: One commenter expressed
concern that accessibility evaluation
criteria and guidelines will be
determined by the State and Local
WDBs. The commenter recommended
the Departments establish general
guidelines for minimum standards,
targets, and metrics.
Departments' Response: The
regulations keep the determination of
accessibility criteria as a responsibility
of the State and Local WDBs, as
required by statute, but such criteria
must meet, at a minimum, the legal
standards established by the regulations
implementing WIOA sec. 188, set forth
at 29 CFR part 38. DOL has issued best
practices in how recipients can comply
with accessibility laws in a guide shared
in Training and Employment Notice No.
01-15, " Promising Practices in
Achieving Universal Access and Equal
Opportunity: A Section 188 Disability
Reference Guide."
55919Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
Evaluations of Continuous Improvement
Comments: A commenter expressed
concern about the use of performance
outcome data in evaluations of
continuous improvement because it may
not be timely enough to identify and
resolve issues.
Departments' Response: States have
the flexibility to add additional data to
the criteria that are more timely if they
wish, but the Departments have
determined that no additional data other
than that which is already included in
the regulations should be required.
8. Common Identifier (20 CFR part 678,
subpart G [ 678. 900]; 34 CFR 361. 900; 34
CFR 463. 900)
The regulations in 20 CFR part 678,
subpart G and 34 CFR 361. 900 and
463. 900 promote increased public
identification of the one-stop delivery
system through use of a common
identifier across the nation, consistent
with WIOA sec. 121( e)( 4). Section
678. 900 designates the name " American
Job Center" as the common identifier for
the one-stop delivery system. This
designation was made by the Secretaries
after consulting with the heads of other
appropriate departments and agencies,
representatives of State WDBs and Local
WDBs, and other stakeholders in the
one-stop delivery system through
various means. This was a process
started under WIA, and many one-stop
centers are already incorporating use of
either the " American Job Center" title or
the associated tag line " proud partner of
the American Job Center network" into
their branding.
The major changes in this section in
response to comments relate to the date
by which rebranding of the one-stop
centers is to be complete. The date by
which one-stop centers are required to
rebrand all of their primary electronic
resources, such as Web sites has been
changed to [ 90 days from the
publication of this Final Rule] instead of
July 1, 2016, which will provide a
reasonable time to effectuate this
provision. Additionally, any new
products and materials printed,
purchased or created after [ 90 days from
the publication of this Final Rule] must
comply with the new branding
requirements. However the Departments
have determined that extending the
deadline to July 1, 2017 for other
branding, including activities, physical
products and signage, would allow an
appropriate amount of time for the
rebranding to be completed.
Additionally, the Departments will not
object if the one-stop centers continue to
use materials not using the " American
Job Center" branding which are created
before [ 90 days from the publication of
this Final Rule] until those supplies are
exhausted.
Section 678.900 What is the common
identifier to be used by each one-stop
delivery system?
Comments: Many commenters
expressed opposition to the use of
American Job Center as a common
identifier. Several commenters said that
they already have a common brand used
in their State, and it would be confusing
to the public to discontinue the use of
an existing brand and begin utilizing
new logos and branding. A few Local
WDBs asked that States have flexibility
in branding, such as by utilizing
American Job Centers of [State name]."
Another commenter suggested that
centers should be permitted to utilize
their program name, followed by " a
partner in America' s Workforce
System." One commenter requested a
waiver for States that already have a
widely known brand. Another Local
WDB commented that the Departments
should allow States with approved
names under WIA be able to continue to
use those names.
Departments' Response: The
Departments are not requiring that any
State or local area discontinue use of
their existing name or brand. The
Departments recognize that many States
and local areas use their own brand,
some of which are well known. The
requirement in § 678. 900( c) to use either
the " American Job Center" identifier or
a proud partner of the American Job
Center network" as a tag line already
allows the usage of other identifiers or
brands or logos. One-stop centers that
want to use their existing name
followed by a tagline may use their
name along with " a proud partner of the
American Job Center network;" the use
of " a partner in America' s Workforce
System" alone would not meet the
requirement. The Departments have
concluded that this section adequately
states that the use of additional
identifiers is permitted, and what the
tagline requirement is, and so have not
made changes in response to these
comments. States that wish to use
American Job Center of [State name]"
would be including the American Job
Center identifier, and thus in
compliance with this regulation. While
the Departments did not make a change
to list different permutations that would
be allowed, the Departments will issue
guidance on the usage of the identifier.
Comments: Some commenters
suggested that the identifier use
career" instead of "jobs." Some
commenters also stated that American
Job Center implies that only citizens can
be served. One commenter asked what
American" means in this context.
Another commenter stated that
American Job Center implies that only
one service—job placement assistance—
is available, and does not address the
other services available at one-stop
centers.
Departments' Response: The
Departments considered the concerns
about " Job" and " American" shared by
commenters hut have maintained the
name American Job Center. The
Departments see value in both " Job" for
its simplicity, directness, and
description of the end goal of virtually
all services; the Departments also see
value in " Career" for its emphasis on
growth. In deciding between the two,
the Departments have chosen to
continue to use " job" because many
States and local areas have already
adopted " American Job Center" or have
incorporated the " proud partner of the
American Job Center network" tag line
into their established branding.
Additionally, " American" is not meant
to imply that only citizens can be
served, but used to communicate that
the centers are part of a nation-wide
system.
Comments: A few commenters asked
the Departments what the logo is for the
common identifier. Some commenters
asked that the new logo or icon be
something simple that can be added to
existing signage without changing the
names of existing centers. Some
commenters stated that they needed
clearer expectations to implement the
common identifier.
One commenter expressed support for
the proposed common identifier. A few
commenters expressed support for the
flexibility provided by the use of " a
proud partner of the American Job
Center network" alongside existing
brands. Another commenter supported
the use of a common identifier, but
cautioned that improper use of the logo,
brand, or tagline could dilute the brand
or mislead the public. This commenter
stated that American Job Center should
be utilized only for comprehensive one-
stop centers, with " A proud partner of
the American Job Center Network"
permitted to be used at other sites. The
commenter also recommended that the
Departments trademark the common
identifier.
Departments' Response: The logo for
American Job Center is available at
www.dol.gov/ajc and its use,
implementation expectations, and
suggestions for adoption at various price
points will be released in upcoming
guidance and technical assistance. In
order to allow job seekers and
employers to find all the locations that
55920 Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
could assist them, the Departments are
continuing to allow all one-stop centers,
comprehensive and affiliate, to use
American Job Center" or the tagline " a
proud partner of the American Job
Center network." The DOL has
trademarked the identifier American Job
Center, as a commenter suggested.
Comments: A few commenters
asserted that this will be an expensive
unfunded mandate for most States, and
requested that the Departments provide
funding to States to help pay for the cost
to print new materials and change
signage, or else make this requirement
optional. One commenter also asked
that the Departments phase in the
change more slowly. Other commenters
urged the Departments to allow one-stop
centers to phase in the change as they
print new materials.
A few commenters requested
clarification regarding the deadline for
implementation. They stated that the
NPRM regulatory text indicated one-
stop centers must utilize the new
identifier by July 1, 2016, but the NPRM
preamble stated that the identifier be in
place during PY 2016, or by June 30,
2017. The commenter requested the
later date, reasoning that changing
signage and materials by July 1, 2016
would be cost prohibitive.
Departments' Response: The
Departments recognize that there is a
cost associated with adopting the
common identifier, and has extended
the timeframe in which one-stop centers
must include the identifier, to require
that one-stop centers use it on Web sites
and online materials by [ 90 days from
the publication of this Final Rule], on
new products and materials purchased
or created after July 1, 2016 and on all
other activities, materials, buildings,
and signs by July 1, 2017. These changes
are reflected in § 678.900(b) and (c).
Implementing the identifier is an
allowable use of WIOA title I funds. The
Departments will release suggestions for
adopting the identifier at various price
points in upcoming guidance and
technical assistance.
While one-stop centers will be
expected to provide the " American Job
Center" or " proud partner of the
American Job Center network" branding
on any newly printed, purchased or
created materials after [ 90 days from the
publication of this Final Rule], this does
not require one-stop centers to discard
previously obtained materials. The
Departments will not object to use of
any materials lacking the branding that
were printed, purchased, or created
before this initial deadline until
supplies are exhausted, regardless of the
final implementation date of July 1,
2017. Paragraphs (b) and (c) of §678.900
have been modified to reflect the
revision of the date when this policy
goes into effect.
In addition to the regulatory text
changes discussed above, various non -
substantive changes have been made for
purposes of correcting typographical
errors and improving clarity that have
not been necessary to note elsewhere.
V. Rulemaking Analyses and Notices
A. Executive Orders 12866 and 13563:
Regulatory Planning and Review
Executive Order (E. O.) 12866 directs
agencies, in deciding whether and how
to regulate, to assess all costs and
benefits of available regulatory
alternatives, including the alternative of
not regulating. E. O. 13563 is
supplemental to and reaffirms E. O.
12866. It emphasizes the importance of
quantifying current and future costs and
benefits; directs that regulations be
developed with public participation;
and, where relevant and feasible, directs
that regulatory approaches be
considered that reduce burdens,
harmonize rules across agencies, and
maintain flexibility and freedom of
choice for the public. Costs and benefits
should include both quantifiable
measures and qualitative assessments of
possible impacts that are difficult to
quantify. If regulation is necessary,
agencies should select regulatory
approaches that maximize net benefits.
The OMB determines whether a
regulatory action is significant and,
therefore, is subject to review.
Section 3( f) of E. O. 12866 defines a
significant regulatory action" as any
action that is likely to result in a rule
that could:
1) Have an annual effect on the
economy of $100 million or more or
adversely affect in a material way the
economy, a sector of the economy,
productivity, competition, jobs, the
environment, public health or safety, or
State, local, or tribal governments or
communities;
2) Create a serious inconsistency or
otherwise interfere with an action taken
or planned by another agency;
3) Materially alter the budgetary
impact of entitlements, grants, user fees,
or loan programs or the rights and
obligations of recipients thereof; or
4) Raise novel legal or policy issues
arising from legal mandates, the
President' s priorities, or the principles
set forth in E. O. 12866.
The Final Rule is a significant
regulatory action under sec. 3( f) of E. O.
12866. The economic effects of the costs
that will result from the changes in this
Final Rule are economically significant.
Outline of the Analysis
Section V.A.1 describes the need for
the Joint WIOA Final Rule and section
V.A.2 describes the alternatives that
were considered in this rule' s NPRM.
Section V.A. 3 summarizes the public
comments received related to the
NPRM, and comments received related
to the VR program -specific requirements
set forth in the NPRM on " State
Vocational Rehabilitation Services
Program; State Supported Employment
Services Program; Limitations on Use of
Subminimum Wage." Section V.A.3 also
provides the Departments' responses to
the comments. Section V.A.4 describes
the process used to estimate the costs of
this Final Rule and the general inputs
used, such as wages and number of
affected entities. Section V.A.5 explains
updates made to the assumptions and
inputs used in the analysis of this Final
Rule relative to the assumptions and
inputs used in the analysis of the
NPRM. Section V.A.5 also describes
how these changes affected the costs of
this Final Rule. Section V.A.6 describes
how the provisions of this Final Rule
will result in quantifiable costs and
presents the calculations the
Departments used to estimate them.
Finally, section V.A.7 summarizes the
estimated first-year and 10 -year total
costs and describes the benefits and
transfers that may result from this Final
Rule.
Summary of the Analysis
The DOL and ED, hereafter
collectively referred to as " the
Departments," provide the following
summary of the Regulatory Impact
Analysis (RIA):
1) This Final Rule is a " significant
regulatory action" under sec. 3( f)(4) of
E. O. 12866 and, accordingly, OMB has
reviewed the Final Rule.
2) This Final Rule is not expected to
have a significant cost impact on a
substantial number of small entities.
The Departments estimate that this
Final Rule will generate benefits
including some that take the form of
cost reductions). Because of the nature
of these benefits, the Departments are
not able to quantify them, but rather
describe them qualitatively in the
Regulatory Benefits" section. As
shown in Exhibit 1, over the 10 -year
period, this Final Rule is estimated to
have an undiscounted total cost of
626. 8 million. This is equivalent to an
estimated annual cost of $62. 7 million.
With 7 -percent discounting over the 10 -
year period, the Final Rule will result in
an estimated total cost of $495. 2
million. This is equivalent to an
55921Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
estimated annualized cost of $70. 5
million (with 7 -percent discounting).
EXHIBIT 1— ESTIMATED MONETIZED
COSTS OF THE DEPARTMENTS OF
LABOR AND EDUCATION FINAL RULE
2015 DOLLARS) ($ MIL)
Undiscounted 10 -Year Total 626. 8
10 -Year Total with 3% Discounting 558. 9
10 -Year Total with 7% 495. 2Discounting
10 -Year Average 62. 7
Annualized with 3% Discounting 65. 5
Annualized with 7% 70. 5Discounting
The largest contributor to the total
cost of the rule is the implementation of
performance accountability
requirements contained in sec. 116 of
WIOA. The largest of these costs include
the development and updating of State
performance accountability systems,
followed by performance reporting
requirements, and adjusting levels of
performance. See section V.A.6
Subject -by -Subject Cost -Benefit
Analysis) for a detailed explanation.
The Departments were unable to
quantify several important benefits to
society due to data limitations and lack
of existing data or evaluation findings.
We qualitatively describe the benefits
related to increased alignment of
training with local labor markets using
economic, education, and workforce
data. In addition, based on a review of
empirical studies (primarily studies
published in peer-reviewed academic
publications and studies we sponsored),
we identified the following societal
benefits: ( 1) Training services increase
job placement rates; ( 2) participants in
occupational training experience higher
reemployment rates; ( 3) training is
associated with higher earnings; and (4)
State performance accountability
measures, combined with the Board
membership provision requiring
employer/ business representation, can
be expected to improve the quality of
the training and, ultimately, the number
and caliber of job placements. We
identified several channels through
which these benefits might be achieved,
including: (1) Better information about
training providers enables workers to
make more informed choices about
programs to pursue; and ( 2) enhanced
services for dislocated workers, self-
employed individuals, and workers
with disabilities will lead to the benefits
discussed above.
In addition, the Departments
qualitatively describe an ancillary
benefit to the DOL -administered core
programs that is expected to result from
the integration of DOL program
participant records. While the
integration of these participant records
is not required by WIOA or these
implementing regulations, it is highly
encouraged. For a detailed description
of the regulatory and ancillary benefits
of the Final Rule, see section V.A. 7
Summary of Analysis).
1. Need for Regulation
Section 503(f)(1) of WIOA requires
publication of implementing
regulations. These regulations will
ensure that States implement
requirements under WIOA efficiently
and effectively. In addition, such
regulations will provide Congress and
others with uniform information
necessary to evaluate the outcomes of
WIOA.
2. Alternatives to the Required
Publication of Regulations
OMB Circular A-4, which outlines
best practices in regulatory analysis,
directs agencies to analyze alternatives
outside the scope of their current legal
authority if such alternatives best satisfy
the philosophy and principles of E. O.
12866. Although WIOA provides little
regulatory discretion, the Departments
assessed, to the extent feasible,
alternatives to the regulations.
As described in the NPRM, the
Departments considered alternatives to
accomplish the objectives of WIOA,
which also would minimize any
significant economic impact on small
entities. This analysis considered the
extent to which WIOA' s prescriptive
language presented regulatory options
that also would allow for achieving
WIOA' s programmatic goals. In many
instances, we have reiterated WIOA' s
language in the regulatory text, and have
expanded some language to provide
clarification and guidance. The
additional regulatory guidance should
result in more efficient program
administration by reducing ambiguities
caused by unclear statutory language.
In addition, the Departments
considered the issuance of sub -
regulatory guidance in lieu of additional
regulations. This policy option has two
primary benefits to the regulated
community. First, sub -regulatory
guidance will be issued following
publication of the Final Rule, thereby
allowing States and local areas
additional time to adhere to additional
guidance. Second, sub -regulatory
guidance is more flexible, allowing for
faster modifications and any subsequent
issuances, as necessary.
The Departments considered three
possible alternatives in the NPRM:
1) Implement the legislative changes
prescribed in WIOA, as noted in this
Final Rule, thereby satisfying the
legislative mandate;
2) Take no action, that is, attempt to
implement WIOA using existing
regulations promulgated under WIA; or
3) Publish no regulation and rescind
existing WIA regulations, which would
result in non-compliance with the
WIOA requirement to publish
implementing regulations.
The Departments considered these
three options in accordance with the
provisions of E. O. 12866 and concluded
that publishing the WIOA Final Rule—
that is, the first alternative—was the
only appropriate option. We considered
the second alternative—retaining
existing WIA regulations as the guide
for WIOA implementation—but WIOA
has changed WIA' s requirements
substantially enough that new
implementing regulations are necessary
for the public workforce system to
achieve compliance. We considered, but
rejected, the third alternative—not to
publish implementing regulations and
rescind existing WIA regulations—
because this option, inherently, does not
provide sufficient detailed guidance to
implement the statutory requirements
effectively.
In addition to the regulatory
alternatives noted above, the
Departments also considered phasing in
certain elements of WIOA over time
different compliance dates), thereby
allowing States and localities more time
for planning and successful
implementation. As a policy option, this
alternative appears appealing in a broad
theoretical sense and, where feasible,
we have recognized and made
allowances for different implementation
schedules. However, with the exception
of these allowances, we are not
implementing an alternative that delays
certain requirements for the following
two reasons: ( 1) Implementation delays
are not operationally feasible because
many critical WIOA elements depend
on the implementation of other
provisions, and ( 2) the costs associated
with additional implementation delays
beyond those noted in this Final Rule
could outweigh the benefits of
alternative starting dates.
3. General Comments Received on the
Economic Analysis in the NPRM
The Departments received several
public comments regarding the
economic analysis, presented RIA in the
NPRM for this rule, and a few other
comments regarding the economic
analysis related to the VR program
specifically as set forth in the NPRM on
State Vocational Rehabilitation
Services Program; State Supported
Employment Services Program;
Limitations on Use of Subminimum
55922 Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
Wage" ( 80 FR 21059 (April 16, 2015)). 1
We considered all comments received.
The significant comments and
summaries of the Departments' analyses
of those comments are discussed in the
following two sections, depending on
whether the comments relate to jointly
administered requirements set forth in
the NPRM for this Final Rule or the
comments relate to VR program -specific
requirements as set forth in the NPRM
on " State Vocational Rehabilitation
Services Program; State Supported
Employment Services Program;
Limitations on Use of Subminimum
Wage." Comments that pertain only to
the VR program, and not jointly
administered requirements, will be
summarized here, but ED will address
them directly in the Final Rule for
State Vocational Rehabilitation
Services Program; State Supported
Employment Services Program;
Limitations on Use of Subminimum
Wage," which is published in this
edition of the Federal Register.
a. Discussion of Public Comments
Related to This Rule' s NPRM
i. Contextualizing the Costs of WIOA
To provide context for the costs of the
NPRM in the RIA, the Departments
expressed the annual cost of the NPRM
relative to the average annual amount
made available to the six core programs
in Fiscal Years (FYs) 2012, 2013, and
2014 under WIA. 2 Based on an average
annual total Federal appropriation of
6. 4 billion for the 3 fiscal years for
these programs, the proportional annual
cost of the NPRM was between 2. 6
percent and 2. 7 percent (using 3 -percent
The NPRM for " State Vocational Rehabilitation
Services Program; State Supported Employment
Services Program; Limitations on Use of
Subminimum Wage" was published at 80 FR 21059
on April 16, 2015. It can be accessed at http://
regulations.gov.
2 U. S. Department of Labor, Employment and
Training Administration. (2015). Archive of State
Statutory Formula Funding. Retrieved from:
https://www.doleta.gov/budget/pyal_py09 arra_
archive.cfm. The Departments used data from the
following files to estimate the average annual WIA
budget: WIA Adult Activities Program (Program
Years [ PYs] 2011, 2012, 2013, and 2014); WIA
Dislocated Worker Activities Program (PYs 2011,
2012, 2013, and 2014); and WIA Youth Activities
PYs 2012, 2013, and 2014). Note that for the adult
and dislocated worker activities programs, each
fiscal year' s funding is calculated as the sum of the
program year's July funding and the previous
program year' s October funding. The youth
activities funding is obligated to States in April and
corresponds to the fiscal year in which it is
obligated.
U.S. Department of Education. (2016).
Department of Education Budget Tables. Retrieved
from: http:// www2.ed.gov/about/ overview/ budget/
tables.html?src= ct. The Departments used data from
the following files to estimate the average annual
WIA budget: Congressional Action (FYs 2012, 2013,
and 2014).
and 7 -percent discounting,
respectively).
Comments: A commenter asserted
that the incremental cost burden should
not be compared to the total funds made
available for these six programs under
WIA, but instead should be compared to
the administrative funds available to the
States because this will be the funding
source for a majority of the new
requirements.
Departments' Response: In section
V.A. 7 ( Summary of Analysis) of this
Final Rule, the Departments present the
incremental burden of WIOA both as a
proportion of the average annual
appropriation for carrying out these
programs under WIA and as a
proportion of the administrative and
transition funds that might be used for
WIOA implementation.
ii. The Value of Common Exit
In the NPRM, the Departments sought
public comments on the value of a
cross -program definition of exit (i.e., a
common exit") that is based on the last
date of service (other than self-service or
information only activities) from all core
programs, rather than a program -specific
exit as proposed in the NPRM. Under a
common exit, an individual would have
to complete services from all core
programs from which he or she received
services to exit from the system.
Comments: Several commenters
stated that a common exit approach
would be costly. Specifically, some of
these commenters asserted that a
requirement to report a common exit
would be prohibitive to States because
a single Management Information
System (MIS) does not exist for all core
programs. Another commenter indicated
that, in addition to the very large costs
that would result from the interfaces
that would need to be built across
programs, additional labor hours would
be required to track the exit dates of
other programs. Other commenters
indicated that some of their clients who
cannot complete instructional services
might continue to use their services for
years if other options are not developed.
These commenters further stated that
data systems would need to have the
capacity to hold clients' data for years,
which could result in significant costs.
On the other hand, one commenter
remarked that the lack of a common exit
would result in the need for more
information technology (IT) resources,
such as increased storage space.
Departments' Response: The
Departments have revised these final
regulations to permit—but not require—
WIOA title I and Wagner-Peyser Act
Employment Service DOL programs to
collect and report common exit data.
Common exit data collection and
reporting will not be permitted or
required for core programs under titles
II and IV of WIOA.
Although the Departments have
concluded an integrated system that
would track common exits for an
individual is a vision for the workforce
development system, an integrated
system is not a requirement under
WIOA or these final regulations.
Furthermore, because the common exit
approach is optional, we have not
concluded that it would cause providers
to extend the duration of program
services artificially. In addition, we
have no way to anticipate how many, if
any, States will implement the common
exit approach. For these reasons, no
costs are included in this analysis
related to the implementation of the
optional common exit approach,
including the cost of developing
integrated systems or artificially
extending the duration of services.
iii. Primary Indicators of Performance
Several commenters addressed the
costs of implementing proposed
requirements related to some of the
primary indicators of performance.
Comments: A few commenters
indicated concerns about tracking
program participants to determine if
they had attained a postsecondary
credential or a secondary school
diploma within 1 year after exiting the
program. These commenters stated that
no system is in place to collect and track
such information and asserted that
doing so would be very staff intensive
and costly. Commenters also expressed
concern that major changes would be
needed to their MISs to track data on
individuals who had exited the
program.
Departments' Response: Although the
Departments understand the concerns
expressed by commenters, we want to
make clear that the performance
indicators proposed in the NPRM and
contained in these final regulations are
consistent with the statutory
requirements set forth in sec.
116(b)( 2)( A) of WIOA. Moreover, we
have concluded that these requirements
will not lead to a burden increase for
most core programs because similar—
although not identical—information was
tracked by these programs for
performance purposes under WIA. We
acknowledge that for some programs,
such as the VR program, post -exit data,
including credential attainment, is not
collected under the current data system.
Consequently, States will have to collect
such data with the informed written
consent of the participant through
follow-up with the exited participant or
55923Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
the educational institution or entity
where the individual was receiving
training. We have concluded this
process will not be overly burdensome
to the VR program, as suggested by the
commenters, however, because the VR
program provides postsecondary
education and training only as a
necessary service to support an
employment goal on the individualized
plan for employment. As a result, in the
vast majority of cases, a credential will
be obtained prior to employment and
prior to exit from the VR program. Very
few individuals will obtain
postsecondary credentials after exiting
the VR program. Hence, only a small
percentage of cases will need to be
tracked manually.
Comments: In response to the
Departments seeking comments on
clarifications that might be needed to
implement the credential attainment
rate performance indicator, one
commenter indicated that implementing
and tracking the time frames would be
an immense reporting burden on States.
Departments' Response: The
Departments did not establish a time
frame for obtaining a credential for
purposes of the performance indicator
required by sec. 116(b)( 2)( A)(i)(IV) of
WIOA, except for that required by
WIOA—specifically that the credential
be attained during the participant' s
participation in the program or within 1
year after exit from the program. Given
that WIOA requires this particular time
frame, there is no statutory authority to
eliminate it from these final regulations
or eliminate any burden estimate related
to its implementation. Therefore, the
estimated burden related to
implementing the statutorily required
time frame is maintained. During the
development of the NPRM, the
Departments considered the extent of
the work required for data collection
and reporting on this indicator and
incorporated the level of effort for those
follow-up activities in the burden
estimates that were published in the
NPRM. These costs will not be
substantial because the time frame for
participants to obtain a credential was
lengthened from only 3 quarters from
exit under WIA to 4 quarters under
WIOA.
Comments: The NPRM proposed that
States would be required to report
information on the career and training
services provided by title I core
programs, as well as the percentage of
those participants who obtain training -
related employment. One commenter
said that the States' administrative data
do not indicate whether employment is
related to training. The commenter
asserted that such data would be costly
to collect directly from each participant
on a case-by-case basis.
Departments' Response: Although the
Departments understand the
commenter' s concern, we want to make
clear that the requirement to collect and
report this information is required by
sec. 116( d)( 2)( G) of WIOA. We do not
agree that collecting and reporting the
required data will be as costly or
burdensome as the commenter suggests.
Currently, State (UI) agencies provide
wage data that, at a minimum, include
a North American Industry
Classification System (NAICS) code that
generally provides an indication of
whether employment outcomes were
training related. In addition, costs for
follow-ups to determine if training was
related to employment were already
accounted for in the baseline because
they were collected under WIA. The
other core programs are not required to
collect and report such data.
Comments: One commenter suggested
that some of the performance measures
proposed for INA supplemental youth
service programs are burdensome—
particularly given the disparity in
funding between the INA youth grants
and State grants. The commenter
remarked that it would cost $1 million
to update its Bear Tracks performance
reporting system, which is currently
used by INA grantees to collect data for
performance measures. The
performance reporting system would
have to be upgraded because: ( 1) It is
not a Web -based application; (2) it does
not provide an adequate level of data
security; and (3) it soon could be
incompatible with the Departments'
new technology. In addition, training
would be required for the INA grantees
across the United States. Furthermore,
the commenter warned that its program
only might be able to handle the
additional reporting burden by keeping
participants as " active participants" by
not exiting them from the program until
they graduate from high school. The
commenter stated that this would create
a significant burden because grantees
would have to provide qualified follow-
up service every 90 days to keep the
participants active.
Departments' Response: The
Departments acknowledge that some
grantees, including grantees awarded
funding under WIOA, title I, subtitle
D— National Programs, could experience
higher burdens than other entities. We
want to make clear that the cost
estimates presented in the NPRM and
these final regulations represent the cost
for a single representative State, not
potential cost burden that could be
realized by individual grantees because
such effects are based on a variety of
factors specific to each program.
Furthermore, we point out that data for
a credential attainment measure are
currently being collected by the INA
program (under WIA) that is similar to
the education and credential indicators
under WIOA and, therefore, the burden
associated with such requirements is
not new but rather is burden already
accounted for in the baseline presented
in the RIA for the NPRM and these final
regulations.
iv. Additional State Performance
Indicators
Comments: A commenter questioned
why the NPRM' s RIA projected burdens
for only five States with regard to
establishing additional performance
accountability indicators and asked for
clarification on which five States were
expected to submit these data. The
commenter asserted that if all States
were expected to submit data, by
accounting only for five, the
Departments were significantly
underestimating the cost of this
requirement in the NPRM.
Departments' Response: Under WIA,
States were permitted to establish
performance indicators in addition to
the required indicators. No State,
however, established additional
performance indicators under WIA.
Based on this past practice, the
Departments estimate that very few
States, if any, will establish additional
performance indicators and report
related data under WIOA. In an effort to
estimate all potential costs where
quantifiable, however, we provided
burden estimates based on as many as
five States choosing to establish
additional performance indicators. To
be clear, the five States referenced in the
NPRM' s RIA were intended as an upper-
level estimate of the number of States
expected to establish additional State
performance indicators, and were not
intended to mean that we knew which
States, if any, would choose to do so.
Burden estimates associated with
collection and reporting of data for the
primary indicators of performance
include all States and are accounted for
elsewhere in provision (c) Performance
Accountability System of the RIA for
these final regulations. For the foregoing
reasons, we have concluded the burden
estimates proposed in the NPRM, and
revised for these final regulations,
reflect an accurate representation of the
expected cost burden of WIOA in the
event that as many as five States decide
to implement and report on additional
performance indicators.
Comments: In the NPRM, the
Departments estimated that seven VR
agencies each would experience $ 5, 000
55924 Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
in one-time software and IT systems
costs and annual labor costs for 60
technical staff members at 9 hours each
to obtain additional information for new
data fields for those States, if any,
choosing to establish additional
performance indicators under WIOA. A
commenter noted that the $ 35, 000 first-
year software and IT systems costs
associated with programming
designated State unit systems (i.e., VR
agencies) accounted for only 7 VR
agencies not 80. In addition, the
commenter indicated that the
Departments underestimated the level of
effort per entity to modify the State -
developed case management system
CMS) so that designated State agencies
and VR agencies could report on the
required performance measures.
Departments' Response: The
Departments want to make clear that the
estimates referenced by the commenter
reflect the increased burden to the VR
program should a few States adopt
additional performance indicators. As
stated in the response to another
commenter, no State established
additional performance indicators under
WIA, even though each was permitted
to do so. To avoid underestimating
costs, however, the NPRM estimated the
burden to the State if up to five States—
two of which have a separate agency for
the individuals who are blind (i.e.,
seven VR agencies)— choose to adopt
additional performance indicators. After
further Departmental review of the
proposed burden estimate, we have
reduced the estimated number of
affected entities from seven to five VR
agencies and reduced the estimated
labor cost per entity, as indicated in
Exhibit 33.
In response to public comments and
based on additional information
received, the Departments have also
eliminated the estimated burden for the
revision of existing CMSs to
accommodate the collection of data to
support additional State indicators. We
have concluded that such indicators
likely would not require the collection
of additional new data. In addition, any
changes needed to State CMSs for such
measures already would be subsumed
by the one-time costs of revising their
existing systems to collect required data
to support the primary indicators of
performance, reported under the
Development and Updating of State
Performance Accountability Systems
subsection of provision (c)
Performance Accountability System"
displayed in Exhibit 18.
iv. State Performance Reports
Comments: In the NPRM, the
Departments proposed that States would
be required to submit a State
performance report, which would
describe, among other things, the
amount of funds spent on career and
training services, respectively, for the
current program year and the 3
preceding program years. Several
commenters asserted that breaking out
the funds spent by service would be too
costly.
One commenter expressed opposition
to tracking and reporting the amount of
funds spent on each type of career and
training service. The commenter stated
that the NPRM did not take into account
the expense of doing so. Citing their
own experiences, multiple commenters
noted that costs incurred for
programming in addition to the ongoing
administrative costs related to IT
systems would be prohibitive.
Another commenter stated that the
existing CMSs do not track funds spent
on each type of career and training
service. The commenter indicated that
this would require the costly and time -
intensive integration of the State' s CMS
with the financial systems in place in
each of the local areas.
A commenter expressed that, in
addition to tracking specific payments
to training providers, it would have to
track indirect costs such as benefits paid
to staff, building space, and the cost of
devices used in delivering services ( e.g.,
computers). The commenter concluded
that the effort to determine these
specific cost breakouts greatly would
exceed the value gained from this
information.
Departments' Response: The
Departments want to make clear that the
statutory requirement and these final
regulations are less burdensome than
the commenters appear to believe.
Section 116( d)( 2)( D) of WIOA requires
the State to report on the amount of
funds spent on " each type of service,"
which we have interpreted to mean
career services, as one type, and training
services, as the other type—not each
individual type of career or training
services, provided to participants.
Therefore, the NPRM' s RIA did not
account for burden associated with
tracking each individual type of career
service and training service provided
because such tracking is not required by
WIOA or these final regulations.
Moreover, the cost estimates in the
NPRM and these final regulations do not
account for IT system integration
because the Departments concluded that
States are unlikely to update their IT
systems to allow for the integration of
fiscal, case management, and
performance data.
The Departments agree with the
commenters that such micro -level
reporting would be burdensome to the
States. Before publishing the NPRM, we
consulted with States and concluded
that this type of tracking would be
extremely burdensome. Therefore, we
have concluded that affected entities are
likely to use a model that divides the
total cost spent on career services or
training services by the total number of
participants who received career
services or training services to
determine the cost per participant.
v. Underestimated Burden for
Development of Strategies for Aligning
Technology and Data Systems Across
One -Stop Partner Programs To Enhance
Service Delivery and Improved
Efficiencies
In the NPRM, the Departments
estimated that State WDBs would incur
a one-time cost of $1. 2 million and that
State-and local -level AEFLA programs
and VR agencies would incur annual
costs of $35. 5 million related to the
development of strategies for aligning
technology and data systems across one-
stop partner programs. This includes
costs for design implementation of
common intake, data collection, case
management information, performance
accountability measurement, reporting
processes, and incorporation of local
input into design and implementation to
improve coordination of services across
one-stop partner programs.
Comments: A few commenters
asserted that the cost of aligning data
and data systems to collect data on
performance measures across programs
was understated in the NPRM. One of
these commenters stated that the
Departments underestimated the burden
for coordinating service delivery across
all of the relevant programs given the
large array of data systems, software
platforms, and partners involved.
Another commenter suggested that
aligning technology and data systems
might prove expensive for State
agencies due to changing or integrated
data system and collection methods.
The commenter concluded that full
integration of technology and data
systems would be a costly and time-
consuming process.
Departments' Response: First, the
Departments want to make clear that
WIOA has no statutory requirement that
data systems be integrated across all
core programs, as some of the
commenters appear to believe. State
WDBs are required to assist Governors
in developing strategies to align
technology and data systems across one-
stop partner programs to enhance
service delivery. Therefore, the NPRM
and these final regulations reflect the
estimated burden for the DOL-
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administered and VR programs
associated with the future
implementation of integrated IT systems
across core programs and the burden for
State agencies to enhance their AEFLA
program participation in the Statewide
Longitudinal Data Systems ( SLDS) Grant
Program. Because States are at varying
stages in the data alignment process, the
cost estimates for DOL -administered
and VR programs presented in the
NPRM represent the national average
costs for " low-" and " high -effort"
States, while the cost estimates for the
AEFLA program do not adopt such a
classification of States and, instead, use
a standard cost estimate for all States.
The Departments understand that some
States could experience higher actual
costs, while actual costs could be lower
for others.
vi. Integrating Record Collection and
Performance Reporting
Comments: One commenter stated
that the Departments underestimated
the cost of integrating record collection
across ED and between DOL and ED in
terms of time and resources. In
particular, the commenter indicated that
the costs would be greater for the VR
program because the VR program has
the most disparate system (i.e., WISPR
is a DOL -specific platform), according to
the commenter. Furthermore, the
commenter suggested that the burden
for integrating data for performance
reporting across core programs belongs
at the Federal level because DOL and ED
receive records from each State for their
respective programs. To have Federal
agencies work out the integration of data
elements and then push this integration
to the States that are integrating their
systems based on Federal
recommendations would be more
efficient. In addition, the commenter
stated that costs are associated with the
guidance and technical assistance that
would be needed to bridge the gap
between workforce partners' current
systems and the Final Rule
requirements before the data could be
integrated.
Departments' Response: The
Departments acknowledge that some
affected entities would experience
higher burdens than other entities.
Following additional consultation with
program experts in the affected DOL and
ED program areas, and based on the best
available evidence, we calculated the
compliance costs of each component of
this Final Rule based on a range of
burden estimates by States, a standard
burden estimate per State, or an
estimate for a single representative State
that was used as a proxy for the average
cost per State in the analysis. Please
note, however, that this Final Rule does
not require the integration of data
collection and reporting systems across
DOL and ED programs. Under WIOA,
State VR programs will continue to
submit RSA -911 data to RSA, except
that data will be submitted quarterly on
open and closed service records instead
of annually on closed service records as
had been done historically. RSA will
use these four quarterly reports to
generate the annual WIOA performance
report, which will be sent to the State
agencies, reducing the burden on State
VR agencies.
Concerning the comment about
burden for integrated reporting
belonging at the Federal level, as part of
the implementation of this rule, DOL
and ED jointly are proposing an
Information Collection for the WIOA
Performance Management, Information,
and Reporting System ( OMB Control
Number 1205-0526). This ICR (WIOA
Joint Performance ICR) and associated
documents, including the WIOA
Participant Individual Record Layout
PIRL), provides a standardized set of
data elements, definitions, and reporting
instructions that will be used to
describe the characteristics, activities,
and outcomes of WIOA participants.
vii. Reductions in State VR Agency
Resources and the Impact of WIOA
Implementation
Comments: One commenter stated
that the cost estimates for the VR
program in the NPRM did not appear to
account for the current reductions in
agency staff and State funding.
Departments' Response: Although the
Departments understand the concern
expressed by the commenter, we want
to make clear that the burden estimates
are based on the estimation of what
implementing new requirements under
WIOA, including both jointly
administered requirements and
program -specific requirements, will cost
States. The burden estimates do not
account for circumstances individual
States face at the State level, such as
reductions in staff or reductions in State
funds for match purposes.
viii. Benefits Due To Reduced Youth
Unemployment
Comments: One commenter said that
WIOA includes improvements that
would ensure low-income workers have
the skills and support needed for full
participation in the workforce.
Specifically, the commenter expressed
that provisions that increase the focus
on comprehensive programming for out-
of-school youth should reduce the effect
youth unemployment has on Federal
and State governments. The commenter
cited a 2014 report, which found that
the average unemployed 18-to 24 -year-
old costs taxpayers over $4,000 annually
and the average unemployed 25-to 34 -
year -old costs taxpayers approximately
9, 000 annually.
Departments' Response: WIOA
provides additional opportunities to
coordinate education and employment
services for youth across the core
programs. The Departments will
continue to encourage these
partnerships and the benefits that result
from their implementation. The study
cited by the commenter evaluates
impacts resulting from reduced welfare
and unemployment benefits being paid
out, as well as increased tax revenue.
The Departments considered these
outcomes in evaluating the impact of
WIOA, and described these and other
impacts resulting from training and
employment services, such as re-
engagement of dislocated workers, in
the Regulatory Benefits discussion and
the Transfers discussion in section
V.A. 7 ( Summary of Analysis) of this
RIA.
ix. Inability to Quantify Benefits
In the NPRM, the Departments stated
that they were unable to quantify the
benefits associated with the NPRM
because of data limitations and a lack of
operational WIOA data or evaluation
findings on the provisions of the NPRM.
The Departments invited comments
regarding how the benefits described
qualitatively in the NPRM could be
estimated.
Comments: Several commenters
stated that State workforce and business
agencies have developed a set of
performance measures designed to
capture the financial impact of services
delivered at the local community,
workforce area, regional, and State
levels. The measures also allow for the
calculation of return on investment. The
commenters remarked that the measures
would allow the economic value of
services delivered to local communities
to be expressed, attainable goals that
align with staff activities to be set, and
staff to understand the value of their
work. These tools are in the initial
stages of development and
implementation.
Departments' Response: The
Departments acknowledge that the tools
described by the commenters are
currently being developed and tested.
We understand, however, that these
tools were developed for use at the
State, local, and regional levels and
have not been applied for similar
purposes at the national level.
Therefore, modifying these tools to
55926 Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
obtain information in the limited time
frame for this analysis was not feasible.
b. Discussion of Public Comments
Related to the Proposed Program -
Specific Rules for the VR Program
i. Underestimated Costs to the VR
Program
Comments: The Departments received
a few comments related to one of ED' s
three WIOA-related NPRMs, which,
among other things, covered VR
program -specific requirements.
Departments' Response: The public
comments pertaining to estimates
provided in the NPRM specific to the
VR program will be responded to
directly by ED in the Final Rule
governing, among other things, the VR
program published elsewhere in this
issue of the Federal Register.
4. Analysis Considerations
The Departments estimated the
additional costs, benefits, and transfers
associated with implementing this
WIOA-required Final Rule from the
existing baseline, that is, the practices
complying with, at a minimum, the
2000 WIA Final Rule (65 FR 49294,
Aug. 11, 2000).
The Departments explain how the
required actions of States, Local WDBs,
employers and training entities,
government agencies, and other related
entities were linked to the estimated
costs and expected benefits. We also
consider, when appropriate, the
unintended consequences of the
regulations introduced by this Final
Rule. We have made every effort to
quantify and monetize the costs and
benefits of the Final Rule. We were
unable to quantify benefits associated
with the Final Rule because of data
limitations and a lack of operational
data or evaluation findings on the
provisions of the Final Rule or WIOA in
general. Therefore, we describe some
benefits qualitatively.
The Departments have made every
effort to quantify all incremental costs
associated with the implementation of
WIOA' s requirements as distinct from
those that already exist under WIA,
WIOA' s predecessor statute. Despite our
best efforts, however, we might be
double counting some activities that
occurred under WIA. Thus, the costs
itemized below represent an upper
bound for the potential cost of
implementing WIOA.
In addition to this Final Rule, the
Departments are publishing separate
final rules to implement program -
specific requirements of WIOA that fall
under each Department' s purview; see
section I of this Joint WIOA Final Rule
Executive Summary). We acknowledge
that these final rules and their
associated impacts might not be fully
independent from one another, but we
are unaware of a reliable method to
quantify the effects of this
interdependence. Therefore, this
analysis does not capture the correlated
impacts of the costs and benefits of this
Final Rule and those associated with the
other Final Rules. We have made an
effort to ensure no duplication of
benefits and costs between this and the
other Final Rules.
In accordance with the regulatory
analysis guidance articulated in Circular
A-4, and consistent with the
Departments' practices in previous
rulemakings, this regulatory analysis
focuses on the likely consequences (i.e.,
costs and benefits that accrue to citizens
and residents of the United States) of
this WIOA-required Final Rule. The
analysis covers 10 years ( 2016 through
2025) to ensure it captures major
additional costs and benefits that accrue
over time. The Departments express all
quantifiable impacts in 2015 dollars and
use 3 -percent and 7 -percent discounting
following Circular A-4.
Exhibit 2 presents the estimated
number of entities expected to
experience a change in level of effort
workload) due to the regulations
included in this Final Rule. The
Departments provide these estimates
and use them extensively throughout
this analysis to estimate the cost of each
provision, where feasible.
EXHIBIT 2— NUMBER OF AFFECTED ENTITIES BY TYPE
Entity type Number of
entities
DOL Program:
States3 457
States establishing additional performance indicators
Local WDBs
55
6 580
AEFLA Program:
States 757
States establishing additional performance indicators
Local AEFLA providers
Local AEFLA providers establishing additional performance indicators
RSA Program:
VR agencies
VR agencies establishing additional performance indicators
85
92,396
1° 200
1180
125
3For simplicity, the Departments' use of the term
States" in this Final Rule RIA refers to the 50
States; the District of Columbia; the U.S. territories
of American Samoa, Guam, the Commonwealth of
the Northern Mariana Islands, the Commonwealth
of Puerto Rico, and the Virgin Islands; and the
Republic of Palau, a country in free association with
the United States. In the NPRM, the number of
States for the DOL program was 56 and 57 for the
AEFLA and RSA programs because DOL did not
include the Republic of Palau.
4Based on internal DOL data.
5 DOL estimate.
6 DOL estimate.
9 Based on internal ED data.
8 ED estimate.
9 Local AEFLA providers include local education
agencies; community-based organizations; faith -
based organizations; libraries; community, junior,
and technical colleges; 4 -year colleges and
universities; correctional institutions; and other
agencies and institutions.
1° Based on internal ED data.
Pursuant to sec. 7( 34) of the Rehabilitation Act
of 1973, as amended, this figure includes the 50
States, the District of Columbia, American Samoa,
Guam, the Commonwealth of the Northern Mariana
Islands, the Commonwealth of Puerto Rico, and the
Virgin Islands. Twenty-four States have two DSAs
for the VR program; therefore, the total number of
VR agencies is 80. The Departments note
particularly that we have sought to avoid
duplication of costs, given the fact that some States
have two VR agencies.
13 Based on internal ED data.
55927Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
Estimated Number of Workers and Level
of Effort
The Departments present the
estimated average number of workers
and the estimated average level of effort
required per worker for each activity in
the subject -by -subject analysis. Where
possible, Federal program experts
consulted with State programs to
estimate the average levels of effort and
the average number of workers needed
for each activity to meet the
requirements relative to the baseline
i.e., the current practice under WIA) to
derive these estimates. These estimates
are the national averages for all States;
thus, some States could experience
higher actual costs, while actual costs
could be lower for other States.
Compensation Rates
In the subject -by -subject analysis, the
Departments present the additional
labor and other costs associated with the
implementation of the provisions in this
Final Rule. Exhibit 3 presents the
compensation rates for the occupational
categories expected to experience an
increase in level of effort (workload) due
to the Final Rule. We use the Bureau of
Labor Statistics' ( BLS) mean hourly
wage rate for State and local
employees. 13 14 We also use wage rates
from the Office of Personnel
Management' s Salary Table for the 2015
General Schedule for Federal
employees. 15 We adjust the wage rates
using a loaded wage factor to reflect
total compensation, which includes
non -wage factors such as health and
retirement benefits. For the State and
local sectors, we use a loaded wage
factor of 1. 57, which represents the ratio
13 Bureau of Labor Statistics. ( 2015). May 2015
national industry -specific occupational
employment and wage estimates: NAICS 999200—
State government, excluding schools and hospitals
OES designation). Retrieved from: http://
www.bls.gov/oes/current/naics4 999200.htm.
14 Bureau of Labor Statistics. ( 2015). May 2015
national industry -specific occupational
employment and wage estimates: NAICS 999300—
Local government, excluding schools and hospitals
OES designation). Retrieved from: http://
www.bls.gov/ oes/ current/ naics4999300.htm.
15 The wage rate for Federal employees is based
on Step 5 of the General Schedule ( source: OPM,
2015, " Salary Table for the 2015 General
Schedule"). Retrieved from: https:// www.opm.gov/
policy-data-oversight/ pay-leave/ salaries-wages/
salary-tables/pdf/2015/ GS h.pdf
of average total compensation 16 to
average wages for State and local
government workers in 2015. 1718 For
Federal employees, we use a loaded
wage factor of 1. 63, which was
estimated using a two-step process.
First, we calculated a loaded wage rate
of 1. 44 for private industry workers,
which is the ratio of average total
compensation 19 to average wages 20 for
16 Bureau of Labor Statistics. ( 2016). 2015
Employer Costs for Employee Compensation.
Retrieved from: http:// www.bls.gov/ schedule/
archives/ ecec nr.htm. The Departments calculated
this value using data from Table 3. " Employer Costs
per Hour Worked for Employee Compensation and
Costs as a Percent of Total Compensation: State and
Local Government Workers, by Major Occupational
and Industry Group." Total compensation for all
workers. To calculate the average total
compensation in 2015 of $44. 53, we averaged the
total compensation for all workers provided in
March, June, September, and December releases.
17 Bureau of Labor Statistics. ( 2016). 2015
Employer Costs for Employee Compensation.
Retrieved from: http:// www.bls.gov/ schedule/
archives/ecec_nr.htm. The Departments calculated
this value using data from Table 3. " Employer Costs
per Hour Worked for Employee Compensation and
Costs as a Percent of Total Compensation: State and
Local Government Workers, by Major Occupational
and Industry Group." Wages and salaries for all
workers. To calculate the average wage and salary
in 2015 of $28. 41, we averaged the wage and
salaries for all workers provided in March, June,
September, and December releases.
18 The State and local loaded wage factor was
applied to all non -Federal employees. Discerning
the number of State and local -sector employees and
private -sector employees at the local level is
difficult; therefore, the Departments used the State
and local -sector loaded wage factor (1. 57) instead of
the private -sector wage factor (1. 44) for all non -
Federal employees to avoid underestimating the
costs.
13 Bureau of Labor Statistics. ( 2016). 2015
Employer Costs for Employee Compensation.
Retrieved from: http:// www.bls.gov/ schedule/
archives/ ecec nr.htm. The Departments calculated
this value using data from Table 5. " Employer Costs
per Hour Worked for Employee Compensation and
Costs as a Percent of Total Compensation: Private
Industry Workers, by Major Occupational Group
and Bargaining Unit Status." Total compensation
for all workers. To calculate the average total
compensation in 2015 of $31. 57, we averaged the
total compensation for all workers provided in
March, June, September, and December releases.
20 Bureau of Labor Statistics. ( 2016). 2015
Employer Costs for Employee Compensation.
Retrieved from: http:// www.bls.gov/ schedule/
archives/ecec_nr.htm. The Departments calculated
this value using data from Table 5. " Employer Costs
per Hour Worked for Employee Compensation and
Costs as a Percent of Total Compensation: Private
Industry Workers, by Major Occupational Group
and Bargaining Unit Status." Wages and salaries for
all workers. To calculate the average wage and
salary in 2015 of $21. 97, we averaged the wage and
salaries for all workers provided in March, June,
September, and December releases.
private industry workers in 2015. We
then multiplied the 2015 loaded wage
rate for private workers ( 1. 44) by the
ratio of the loaded wage factors for
Federal workers to private workers
1. 13) using data from a Congressional
Budget Office report 21 to estimate the
2015 loaded wage rate for Federal
workers of 1. 63. 22 We then multiply the
loaded wage factor by each occupational
category' s wage rate to calculate an
hourly compensation rate.
The Departments use the hourly
compensation rates presented in Exhibit
3 throughout this analysis to estimate
the labor costs for each provision.
21 Congressional Budget Office. ( 2012).
Comparing the compensation offederal and
private -sector employees. Tables 2 and 4. Retrieved
from: https:// www.cbo.gov/sites/ default/files/112th-
congress-2011-2012/reports/01-30-FedPay0.pdf.
The Departments calculated the loaded wage rate
for Federal workers of all education levels of 1. 63
by dividing total compensation by wages ( 1. 63 =
52. 50/$ 32. 30). We then calculated the loaded wage
rate for private sector workers of all education
levels of 1. 44 by dividing total compensation by
wages ( 1. 44 = $ 45. 40/$ 31. 60). Finally, we
calculated the ratio of the loaded wage factors for
Federal to private sector workers of 1. 13 ( 1. 13 =
1. 63/ 1. 44).
22 The Departments conclude that the overhead
costs associated with this Final Rule are small
because the additional activities required by the
Final Rule will be performed by existing employees
whose overhead costs are already covered.
However, acknowledging that there might be
additional overhead costs, as a sensitivity analysis
of results, we calculate the impact of more
significant overhead costs by including an overhead
rate of 17 percent. This rate has been used by the
Environmental Protection Agency (EPA) in its final
rules (see for example, EPA Electronic Reporting
under the Toxic Substances Control Act Final Rule,
Supporting & Related Material), and is based on a
Chemical Manufacturers Association study. An
overhead rate from chemical manufacturing may
not be appropriate for all industries, so there may
be substantial uncertainty concerning the estimates
based on this illustrative example. (By contrast,
DOL' s Employee Benefits Security Administration
EBSA) includes overhead costs that are
substantially higher and more variable across
employee types than EPA' s— between 39 and 138
percent of base wages for compensation and
benefits managers, lawyers, paralegals and other
legal assistants, and computer systems analysts—as
presented in detail at www.dol.gov/ebsa/pdf/labor-
cost-inputs-used -in -ebsa-opr-ria -and-pra-burden-
calculations-march-2016.pdf.)Using an overhead
rate of 17 percent would increase the total cost of
the Final Rule by 4. 7 percent, from $135 2 million
in Year 1 to $141. 5 million Over the 10 -year
period, using an overhead rate of 17 percent would
increase the total undiscounted cost of the Final
Rule from $ 620. 4 million to $ 650. 2 million, or 4. 8
percent.
55928 Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
EXHIBIT 3 -COMPENSATION RATES
2015 dollars]
Average Loaded Hourly
hourly wage compensation
Position Grade level wage rate factor rate
a b c= axb
Local Emp oyees
Computer systems analysts N/A 38.70 1. 57 60.76
Database administrators 37.96 59.60
Management analysts 38.60 60.60
Management occupations staff 40.53 63. 63
Office and administrative support occupations 18.70 29.36
Social and community service managers 38. 86 61. 01
State Employees
Computer systems analysts N/ A 35.78 1. 57 56. 17
Database administrators 36.32 57.02
Lawyers 41. 71 65. 48
Management analysts 29.22 45.88
Management occupations staff 41. 65 65. 39
Office and administrative support occupations 19.47 30.57
Rehabilitation counselors 23.35 36.66
Social and community service managers 34. 53 54. 21
Social workers 22.43 35.22
Staff trainers23 34.53 54.21
State Rehabilitation Council Board members24 29.22 45.88
Federal Employees
Federal positions GS -12, Step 5 .. 33.39 1. 63 54.43
GS -13, Step 5 .. 39.70 64.71
GS -14, Step 5 .. 46.92 76.48
The subject -by -subject analysis WIOA. This analysis estimates these to calculate the incremental total cost
presents the total incremental costs of incremental costs, which affected for each provision over the 10 -year
the Final Rule relative to the baseline -analysis period.entities will incur in complying with
that is, requirements applicable to core the Final Rule. The equation below
programs prior to the enactment of shows the method the Departments use
10 n m
Total Cost = Al 1(Ni x Hi x x Li) + Aj x C)
T=1 i=1 j=1
Where, The total cost of each provision is member to perform the activity, H;; the
A, Number of affected entities that will calculated as the sum of the total labor mean hourly wage rate of staff of
incur labor costs, cost and total non -labor cost incurred occupational category i, W;; and the
N; Number of staff of occupational category each year over the 10 -year period (see loaded wage factor of staff of
Exhibit 50 for a summary of the average occupational category i, L. The totalH; Hours required per staff of occupational annual cost of the Final Rule by non -labor cost is the sum of the non -category i, provision). The total labor cost is the labor costs for each non -labor cost typeW; Mean hourly wage rate of staff of sum of the labor costs for eachoccupational category i, j (e.g., consulting costs) multiplied by
L, Loaded wage factor of staff of occupational category i (e.g., computer the number of affected entities that will
occupational category i, systems analysts, database incur non -labor costs, A,.
A; Number of affected entities incurring administrators, and lawyers) multiplied Transfer Paymentsnon -labor costs of type j, by the number of affected entities thatC Non -labor cost of type j, will incur labor costs, Al. The labor cost The Departments provide an
i Occupational category, assessment of transfer paymentsn Number of occupational categories, for each occupational category i is
j Non -labor cost type, calculated by multiplying the number of associated with transitioning the
m Number of non -labor cost types, staff members required to perform the Nation' s public workforce system from
T Year. activity, N;; the hours required per staff the requirements of WIA to the new
23 Based on the BLS mean hourly wage for social 24 Based on the BLS mean hourly wage rate for
and community service managers. management analysts.
55929Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
requirements of WIOA. In accordance
with Circular A-4, we consider transfer
payments as payments from one group
to another that do not affect total
resources available to society. For
example, under both WIA and WIOA,
financial transfers via formula grants
will be made from the Federal
government to the States and from the
States to Local WDBs, as appropriate. In
accordance with the State allotment
provisions required by WIOA sec. 127,
the interstate funding formula
methodology is not significantly
different from that used for the
distribution of funds under WIA.25
One example of where impacts are
discussed qualitatively, rather than
quantified, is the expectation that
available U.S. workers trained and hired
who were previously unemployed will
no longer seek new or continued UI
benefits. Assuming other factors remain
constant, the Departments expect State
UI expenditures to decline because of
the hiring of U. S. workers following
WIOA implementation. We cannot
quantify these transfer payments,
however, due to a lack of adequate data.
5. Updates to the Cost -Benefit Analysis
for the Final Rule
In total, the Departments estimate that
this Final Rule will result in a 10 -year
undiscounted cost of $626. 8 million (in
2015 dollars). We estimated that the
NPRM would result in $1. 5 billion in
undiscounted costs (in 2013 dollars). As
discussed below, after reviewing public
comments and with further consultation
with program experts in the DOL and
ED program areas, we updated the cost
analysis and made changes to specific
provisions in the NPRM that affected
costs.
General Updates
In the Final Rule economic analysis,
the Departments update all costs to 2015
dollars from 2013 dollars in the NPRM.
EXHIBIT
NPRM
a) Time to Review the New Rule
b) New Elements to State and Local Plans
This update increases the estimated cost
of the Final Rule relative to the cost
presented in the NPRM.
In addition, the Departments have
made several updates to the labor cost
estimates. First, we use more
appropriate occupational categories
than those used in the NPRM (i.e.,
administrative staff, Board members,
counsel staff, local stakeholders,
managers, and technical staff). In this
Final Rule, the occupational categories
include: computer systems analysts,
database administrators, lawyers,
management analysts, management
occupations staff (hereafter referred to
as " managers"), office and
administrative support occupations staff
hereafter referred to as " office and
administrative support staff"),
rehabilitation counselors, social and
community service managers, social
workers, staff trainers, and State
Rehabilitation Council (SRC) Board
members. Due to the numerous changes
made to each provision in the analysis,
which are described in detail below,
these occupational categories add more
specificity to the labor costs, but it is
unclear whether they had a positive or
negative effect on costs as a whole.
Second, the Departments have
updated labor costs, including wage
rates and loaded wage factors, to reflect
2015 BLS data. Furthermore, instead of
using State government employee wage
rates for workers at both the State and
local level as in the NPRM, we applied
wage rates for State government
employees and local government
employees to workers at the State and
local levels, respectively. Depending on
the occupational category, the State -
level wage rate could be higher or lower
than the corresponding local -level wage
rate; thus, it is unclear whether this had
a positive or negative effect on costs as
a whole.
Third, based on further discussion
with DOL program experts, the
4— UPDATES TO COST PROVISIONS IN THE
Final rule
a) Time to Review the New Rule
b) Unified or Combined State Plans: Ex-
panded Content, Biennial Development and
Modification Process, and Submission Co-
ordination Requirements.
Departments have increased the overall
number of States affected by DOL
program requirements from 56 to 57 in
the Final Rule because we concluded
that the WIOA requirements also will
affect the Republic of Palau.
In the Final Rule, the Departments
have made several changes to the
provisions presented in the NPRM.
Exhibit 4 presents a summary of the
updates made to the NPRM provisions
in the Final Rule. To simplify the
analysis and combine related
requirements, we merge the following
provisions:
Provision (b) " New Elements to
State and Local Plans" and provision (f)
Unified or Combined State Plans" are
combined to form provision (b) " Unified
or Combined State Plan: Expanded
Content, Biennial Development and
Modification Process, and Submission
Coordination Requirements."
Provision (c) " Development and
Updating of State Performance
Accountability Measures," provision (e)
Development of Strategies for Aligning
Technology and Data Systems across
One -Stop Partner Programs," provision
h) " State Performance Accountability
Measures," provision (i) "Performance
Reports," Evaluationand provision (j) "
of State Programs" are combined to form
provision (c) " Performance
Accountability System."
In addition, the Departments have
decided that the following two
provisions are more appropriate in the
DOL WIOA Final Rule RIA: Provision
d) " Identification and Dissemination of
Best Practices" and provision (g) " Local
Plan Revisions." Although the updates
made to each provision (i.e., changes
from the NPRM estimates) are discussed
under the relevant headings below, a
detailed description of each cost
provision remains in section V.A.6
Subject -by -Subject Cost -Benefit
Analysis).
NPRM
Required activities in NPRM26
Learn about new regulations and plan for
compliance.
Develop new 4 -year Unified or Combined
State Plans; and
Review and modify 4 -year Unified or Com-
bined State Plans.
not small entities, however, the Departments do not is not a comprehensive list of all Final Rule25 States may elect to change the distribution of
requirements.funds at the local level and appropriately document anticipate any impact on small entities.
such changes in the State Plans. Because small 26 This column maps the requirements from the
RIA of the NPRM to the RIA of the Final Rule, andentities are fully funded by the States, which are
55930 Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
EXHIBIT 4— UPDATES TO COST PROVISIONS IN THE NPRM— Continued
NPRM Final rule Required activities in NPRM26
c) Development and Updating of State Per-c) Performance Accountability System Develop and update the State performance
formance Accountability Measures. accountability systems;
Implement measures for data collection and
reporting on the effectiveness in serving
employers;
Negotiate levels of performance;
Run statistical adjustment model to adjust
levels of performance based on actual eco-
nomic conditions and characteristics of par-
ticipants;
Provide technical assistance to States;
Obtain UI wage data; and
Purchase data analytic software and per-
form training.
d) Identification and Dissemination of Best Moved to the DOL WIOA Final Rule ( see pro-N/ A.
Practices. vision ( c) " Identification and Dissemination
of Best Practices").
e) Development of Strategies for Aligning c) Performance Accountability System Align technology and data systems across
Technology and Data Systems across One-one-stop partner programs.
Stop Partner Programs.
f) Unified or Combined State Plan b) Unified or Combined State Plans: Ex-Review and develop new 4 -year Unified or
panded Content, Biennial Development and Combined State Plans to ensure they sat -
Modification Process, and Submission Co-isfy the new content requirements; and
ordination Requirements. Coordinate actions for developing a new 4 -
year Unified or Combined State Plan
among the core programs administered by
the Departments.
g) Local Plan Revisions Moved to the DOL WIOA Final Rule: ( See N/ A.
provision ( m) " Local and Regional Plan
Modification").
h) State Performance Accountability Measures c) Performance Accountability System Collect data to report on additional State
performance accountability measures.
i) Performance Reports c) Performance Accountability System Develop a performance report template that
reports outcomes via the new WIOA per-
formance accountability metrics;
Develop, update, and submit eligible train-
ing provider ( ETP) reports;
Collect, analyze, and report performance
data; and
Provide training on data collection.
j) Evaluation of State Programs d) State Evaluation Responsibilities Coordinate any evaluation activities to co-
operate in the provision of various forms of
data for evaluation activities; and
Coordinate in designing and developing
evaluations carried out under sec. 116( e) of
WIOA.
Time To Review the New Rule
This section describes the updates to
the NPRM' s provision (a) " Time to
Review the New Rule." In this Final
Rule' s subject -by -subject analysis, costs
related to this provision are found in
provision (a) " Time to Review the New
Rule." The cost of this provision reflects
the cost for individuals in the regulated
community to learn about the new
regulations and plan for compliance.
Each core program has different staffing
and WIOA affects them differently,
which would result in different labor
categories and level of effort for them to
read and understand the Joint WIOA
Final Rule. The total undiscounted 10 -
year cost of this provision decreased
from $17. 7 million for the NPRM to $ 3. 3
million for this Final Rule. 27
At the State level for the DOL
programs, the Departments made the
following changes, which are presented
in Exhibit 5. Following additional
discussions with program experts, we
decreased the number of DOL
management staff from two to one. We
added four lawyers who will review the
new requirements in the Final Rule.
Finally, we replaced the technical staff
in our previous estimate with the more
appropriate occupational category of
social and community service manager.
Although the number of personnel in
this last category was reduced from four
to two, the level of effort was increased
from 20 to 40 hours; hence, the overall
level of effort (80 hours) remained the
same.
27 This variance in cost is mainly a result of the of effort required for this activity for the State-and
decrease in the estimated number of staff and level local -level AEFLA program.
55931Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
EXHIBIT 5— UPDATES TO COSTS OF STATE -LEVEL DOL PROGRAMS— TIME TO REVIEW THE NEW RULE
NPRM Final rule
a) Time to review the new rule a) Time to review the new rule
Labor cat-
egory
Average
number of
workers
Average
level
of effort
hrs.)
Frequency
Number of
affected
entities
Labor category
Average
number of
workers
Average
level
of effort
hrs.)
Frequency
Number of
affected
entities
Manager 2 20 One time 56 States Management occupa-1 20 One time 57 States.
tions staff.
Technical 4 20 Lawyer 4 20
staff.
Social & community 2 40
service manager.
Exhibit 6 presents the updates to the managers are categorized as social and will not spend as much time on this
State -level AEFLA program. The community service managers and will activity as the State director, who will
Departments consulted with experts at have a level of effort of 20 hours rather be responsible for implementation. We
the State -level AEFLA program and than 40 hours because we concluded also excluded the two technical and five
decided to reduce the number of that associate staff will not spend as administrative staff included in our
managers from five to four after much time on this activity as the State previous estimate because those
concluding that the number needed to director.28 We reduced the level of effort occupational categories generally are reflect an average staffing level across required from the lawyer from 40 to 20 not involved in reviewing regulations.all States and outlying areas was less hours because we concluded that the
than expected. Three of the four lawyer, whose role is largely advisory,
EXHIBIT 6— UPDATES TO COSTS OF STATE -LEVEL AEFLA PROGRAMS— TIME TO REVIEW THE NEW RULE
NPRM Final rule
a) Time to review the new rule a) Time to review the new rule
Average AverageAverage Number of Average Number of Labor cat-level level number of affected number of affectedFrequency Labor category Frequencyof effort of effort workers entities workers entitiesegory
hrs.) hrs.)
Manager 5 40 One time 57 States Management occupa-1 40 One time 57 States.
tions staff.
Counsel 1 40 Lawyer 1 20
staff.
TechnicalTechnical 2 40 Social & community 3 20
staff.staff. service manager.
Admin. staff 5 40
The Departments made the following managers are categorized as social and technical staff members with three
updates to the State VR program, which rehabilitation counselors to review thecommunity service managers. In
are shown in Exhibit 7. We consulted addition, we increased the level of effort new requirements of the Final Rule.
with VR program experts and decided to per manager from 20 to 40 hours to This change was made to better reflect
increase the number of managers from reflect the greater complexity of the new the VR agency staff who will be
three to four. Three of these four rule. We replaced the counsel and performing this task.
EXHIBIT 7— UPDATES TO COSTS OF STATE -LEVEL VR PROGRAMS— TIME TO REVIEW THE NEW RULE
NPRM Final rule
a) Time to review the new rule a) Time to review the new rule
Average AverageAverage Number of Average Number ofLabor cat-level level number of affected number of affectedFrequency Labor category Frequencyof effort of effort workers entities workers entitiesegory
hrs.) hrs.)
Manager 3 20 One time 80 VR agen-Management occupa-1 40 One time 80 VR
cies. tions staff. agen-
cies.
28 The Departments used the occupations estimate the compensation rate for the State
category of "management occupations staff' to Director.
55932 Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
EXHIBIT 7— UPDATES TO COSTS OF STATE -LEVEL VR PROGRAMS— TIME TO REVIEW THE NEW RULE— Continued
Labor cat-
egory
Counsel
staff.
Technical
staff.
NPRM
a) Time to review the
AverageAverage level number of of effort workers hrs.)s.)
1 20
1 20
At the local level for the AEFLA
program, the Departments made the
following changes, which are presented
in Exhibit 8. We concluded that local
involvement in reviewing the new rule
generally will require participation in a
statewide meeting convened by the
State office to present the new rule and
EXHIBIT 8— UPDATES TO COSTS OF LOCAL -LEVEL AEFLA PROGRAMS— TIME TO REVIEW THE NEW RULE
Labor cat-
egory
Manager
Technical
staff.
Admin. staff
NPRM Final rule
a) Time to review the new rule a) Time to review the new rule
Average AverageAverage Number of Average Number of level level number of affected number of affected of effort of effortFrequency Labor category Frequency
workers hrs.)
40 40 OneOne timetime
40 40
40 40
New Elements to State and Local Plans
This section describes the updates to
the NPRM' s provision (b) " New
Elements to State and Local Plans." In
this Final Rule' s subject -by -subject
analysis, this cost provision is included
in provision (b) " Unified or Combined
State Plans: Expanded Content, Biennial
Development and Modification Process,
and Submission Coordination
Requirements" and it captures the cost
of developing new 4 -year Unified or
Combined State Plans, performing a
review of each State Plan, and
modifying it 2 years after it is submitted.
For this activity, the total 10 -year cost
undiscounted) decreased from $53. 9
new rule
Number of
affectedFrequency Labor category
entities
Social & community
service manager.
Rehabilitation counselor
address questions raised by local staff.
We added one social and community
service manager who will review the
new requirements of the Final Rule.
Based on conversations with additional
program experts, we excluded the
technical and administrative staff
included in our previous estimate,
Final rule
a) Time to review the new rule
AverageAverage Number of level number of affectedFrequencyof effort workers entitieshrs.)
3 40
3 40
because those occupational categories
generally are not involved in reviewing
regulations. Note that, instead of
presenting the costs at the State level as
in the NPRM, we are presenting costs at
the program, or local, level.
entities workers entities
5757 StatesStates Management occupa-
tions staff.
Social & community
service manager.
million in the NPRM to $ 1. 9 million in
the Final Rule. 29 These revised cost
estimates can be found under the
subsections " Four -Year Plan
Modification—Third Year,"
Development of New 4 -Year Plan—
Fifth Year," " Four -Year Plan
Modification—Seventh Year," and
Development of New 4 -Year Plan—
Ninth Year," in provision (b) of this
Final Rule.
At the State level for the DOL
programs, the Departments made the
following changes, which are presented
in Exhibit 9. In the Final Rule, required
compliance activities are measured
biennially and instead of assuming a
constant level of effort for each biennial
hrs.)
1 4 OneOne timetime 2,2, 396396 locallocal
pro-pro-
grams.grams.
1 4
activity, we assumed that the level of
effort will be slightly higher for
managers and management analysts to
modify the first 4 -year State Plan and
develop the second State Plan than it
will be to produce new State Plans and
modifications in subsequent years. The
Departments expect that more effort
initially will be expended to build
relationships between new partners and
to acquire experience drafting State
Plans in a format that might be new to
some partners. In addition, we added
managers and lawyers and we replaced
the technical staff in our previous
estimate with the more appropriate
occupational category of management
analyst.
29 The variance in cost is due to changes to the is mainly due to AEFLA omitting biennial State -development and modification process will
assumptions used to estimate costs ( e. g., number of level consulting costs and biennial local -level labor decrease over time rather than remain constant. The
staff, occupational categories, level of effort, and costs and the Departments' assumption that the Final Rule does not implement any policy changes
level of effort to undertake the biennial over the NPRM that impact this cost.frequency.) More specifically, this variance in cost
55933
EXHIBIT 9— UPDATES TO COSTS OF STATE -LEVEL DOL PROGRAMS— NEW ELEMENTS TO STATE AND LOCAL PLANS
Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
Labor cat-
egory
Technical
staff.
Admin. staff
NPRM Final rule
b) New elements to state and local plans b) Unified or combined state plans: expanded content, biennial development and
modification process, and submission coordination Requirements
AverageAverage Number of Averagelevel Average Number of number of Frequency affected level of effort number of affectedLabor category Frequencyworkers hrs.)
2 16 Annual
16
Exhibit 10 presents the changes made
by the Departments at the State level for
the AEFLA program. The Departments
considered the State office' s historical
level of effort for State Plan
development. The Departments expect
that it will take more effort initially to
build relationships between new
partners and to acquire experience
drafting State Plans in a format that may
be new to some partners. We concluded
that the AEFLA State office could
leverage economies of scale for the
biennial State Plan development and
entities of effort workers entities hrs.)
56 States Four -Year Plan Modification—Third Year
Management occupa-12 3rd year 57 States.
tions staff.
Lawyer 4
Management analyst .... 2 12
Office & admin. support 4
staff.
Deve opment of New 4 -Year Plans—Fifth Year
Management occupa-12 5th year 57 States.
tions staff.
Lawyer 4
Management analyst .... 2 12
Office & admin. support 4
staff.
Four -Year Plan Modification— Seventh Year
Management occupa-8 7th year 57 States.
tions staff.
Lawyer 4
Management analyst .... 2 8
Office & admin. support 4
staff.
Development of New 4 -Year Plans—Ninth Year
Management occupa-
tions staff.
Lawyer
Management analyst ....
Office & admin. support
staff.
modification process required under
WIOA. That is, established procedures
and experienced staff already will be in
place from previous State Plan efforts to
gather, refine, and incorporate input for
modification of the new elements. In
addition, we anticipate that the extent of
necessary plan modifications will
decrease over time as the elements are
improved with each revision cycle.
Burdens will be higher in the fifth and
ninth years to account for the additional
burden involved with developing new
State Plans. Furthermore, we reduced
10 9th year 57 States.
4
2 10
4
the number of managers from five to
four (three of which are categorized as
social and community service
managers). We removed technical and
administrative staff because we
concluded that those occupational
categories are not typically involved in
State Plan development. In addition, we
removed the consultant cost because we
concluded that consultants are not
commonly engaged in State Plan
development.
55934 Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
EXHIBIT 10— UPDATES TO COSTS OF STATE -LEVEL AEFLA PROGRAMS— NEW ELEMENTS TO STATE AND LOCAL PLANS
b)
NPRM
New elements to state and local plans
Labor
category
Average
number of
workers
Average
level
of effort
hrs.)
Frequency
Number of
affected
entities
Manager
Counsel staff ...
5
1
40
20
Biennial 57 States
Technical staff
Admin. staff ....
2
5
40
20
Consultant cost 25 000
Final rule
b) Unified or combined state plans: Expanded con ent, biennial development and
modification process, and submission coordination requirements
AverageAverage Number of level Labor category Frequencynumber of affected of effort workers entitieshrs.)
Four -Year Plan Modification— Third Year
Management occupations 1 10 3rd year 57 States.
staff.
Lawyer 1 10
Social & community serv-3 10
ice manager.
Development of New 4 -Year Plans—Fifth Year
Management occupations 1 15 5th year 57 States.
staff.
Lawyer 1 15
Social & community serv-3 15
ice manager.
Four -Year Plan Modification— Seventh Year
Management occupations 1 5 7th year 57 States.
staff.
Lawyer 1 5
Social & community serv-3 5
ice manager.
Development of New 4 -Year Plan—Ninth Year
Management occupations 1 10 9th year 57 States.
staff.
Lawyer 1 10
Social & community serv-3 10
ice manager.
The Departments made the following slightly for developing the second 4 -drafting State Plans in a format that
updates to the State VR program, which year State Plan in the fifth year, and will might be new to some partners. In
are shown in Exhibit 11. Instead of remain at a slightly lower level for the addition, we replaced the technical staff
assuming a constant level of effort for subsequent development and in our previous estimate with the more
each biennial activity, we assumed the modification process. Again, this appropriate occupational category of level of effort will be highest for decrease over time reflects the initial social and community service manager.
modifying the first new 4 -year State effort to build relationships between
Plan in the third year, will decrease new partners and to acquire experience
EXHIBIT 11— UPDATES TO COSTS OF STATE -LEVEL VR PROGRAMS— NEW ELEMENTS TO STATE AND LOCAL PLANS
NPRM Final rule
b) New elements to state and local plans b) Unified or combined state plans: Expanded content, biennial development and
modification process, and submission coordination requirements
Average
Labor
category
Average
number of
workers
level
of effort
hrs.)
Frequency
Number of
affected
entities Labor category
Average
number of
workers
Average
level
of effort
hrs.)
Frequency
Number of
affected
entities
Manager 1 5 Biennial 80 VR agen-Four -Year Plan Modification— Third Year
cies.
Technical staff 1 5 Management occupations 2 14 3rd year 80 VR agen-
staff. cies.
Social & community serv-2 14
ice manager.
Deve opment of New 4 -Year Plan— Fifth Year
55935
EXHIBIT 11— UPDATES TO COSTS OF STATE -LEVEL VR PROGRAMS— NEW ELEMENTS TO STATE AND LOCAL PLANS—
Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
Continued
NPRM Final rule
b) New elements to state and local plans b) Unified or combined state plans: Expanded content, biennial development and
modification process, and submission coordination requirements
AverageAverage Number of AverageLabor level Average number of Frequency affected level of effort number ofLabor categorycategory workers hrs.)
For the AEFLA program at the local
level, the Departments made the
following changes, which are presented
in Exhibit 12. We have concluded that
EXHIBIT 12— UPDATES TO COSTS OF
NPRM
b) New elements to state and local plans
Average
category workers hrs.)
Manager 40 40 Biennial
Admin. staff .... 40 20
Development and Updating of State
Performance Accountability Measures
This section describes the updates to
the NPRM' s provision (c) " Development
and Updating of State Performance
Accountability Measures." In this Final
Rule, this cost provision has been
included in provision (c) " Performance
Accountability System," and it captures
the cost of: (1) Developing and updating
the State performance accountability
system; ( 2) implementing measures for
data collection and reporting on the
effectiveness in serving employers; (3)
negotiating levels of performance; (4)
running the statistical adjustment model
to adjust levels of performance based on
actual economic conditions and
characteristics of participants; ( 5)
providing technical assistance to States;
6) obtaining UI wage data; and ( 7)
Frequencyentities of effort workers hrs.)
Management occupations 2 10 5th year
staff.
Social & community serv-2 10
ice manager.
Four -Year Plan Modification— Seventh Year
Management occupations 2 7 7th year
staff.
Social & community serv-2 7
ice manager.
Development of New 4 -Year Plan—Ninth Year
Management occupations
staff.
Social & community serv-
ice manager.
local AEFLA staff will not bear the
burden for reviewing State and Local
Plans because we have concluded that
reviewing State and Local Plans is not
LOCAL -LEVEL AEFLA PROGRAMS— NEW
Average Number of Average Number of Labor level level number of affected number of affectedFrequency Labor category Frequencyof effort of effort entities workers entities
57 States
purchasing data analytic software and
performing training. For these activities,
the total 10 -year cost (undiscounted)
increased from $128. 9 million in the
NPRM to $ 320. 0 million in this Final
Rule.30 31 These revised cost estimates
can be found under the subsections
Development and Updating of State
3° A portion of the $ 320 0 million in costs
accounts for software and IT systems costs from
provision (e) " Development of Strategies for
Aligning Technology and Data Systems across One -
Stop Partner Programs," provision (i) "Performance
Reports," and provision (j) " Evaluation of State
Programs." Thus, this value overstates how much
costs have increased in this Final Rule relative to
the NPRM.
31 This variance in cost is mainly due to new
burdens for negotiating levels of performance and
running statistical adjustment models to adjust
levels of performance and to new Federal -level
burdens for the VR program to develop and update
the State performance accountability systems.
2 7 9th year
2 7
Number of
affected
entities
80 VR agen-
cies.
80 VR agen-
cies.
80 VR agen-
cies.
the role of local AEFLA staff. Therefore,
we removed all cost inputs at the local
level related to this provision.
ELEMENTS TO STATE AND LOCAL PLANS
Final rule
NA
Average
hrs.)
N/ A
Performance Accountability Systems,"
Negotiation of Levels of Performance,"
Running Statistical Adjustment Model
to Adjust Levels of Performance Based
on Actual Economic Conditions and
Characteristics of Participants,"
Technical Assistance to States,"
Obtain UI Wage Data," and " Data
Analytic Software and Training," in
provision (c) of this Final Rule.
At the Federal level for the DOL
programs, the Departments made the
following changes, which are presented
in Exhibit 13. We added a one-time
Federal software and IT systems cost of
750, 000 to upgrade the system to meet
the requirements of WIOA. Following
discussions with additional program
experts, we accounted for the effort
related to negotiating levels of
performance and adjusting levels of
performance based on economic
55936 Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
conditions and the characteristics of not required under WIA. For adjusting at 250 hours for managers and 1, 000
participants. For negotiations, we added levels of performance, we also added hours for computer systems analysts.
one manager and two management one manager and two computer systems Furthermore, licensing fees of $10, 000
analysts. The biennial level of effort is analysts to account for running the will be incurred to purchase the
estimated at 8 hours for both regression model twice per year as statistical software used to perform the
occupational categories. This additional required under WIOA rather than only regression analysis and modeling.
level of effort is required for existing once per year as required under WIA.
staff to compile new inputs that were The annual level of effort is estimated
EXHIBIT 13— UPDATES TO COSTS OF FEDERAL -LEVEL DOL PROGRAMS— DEVELOPMENT AND UPDATING OF STATE
PERFORMANCE ACCOUNTABILITY MEASURES
NPRM Final rule
c) Development and updating of state performance accountability measures c) Performance accountabili y system
Average AverageAverage Number of Average Number of Labor level level number of affected number of affectedFrequency Labor category Frequencyof effort of effort workers entities workers entitiescategory
hrs.) hrs.)
N/ A Development and Updating of State Performance Accountability Systems
Software/ IT systems 750, 000 One time 1
cost.
Negotiation of Levels of Performance
Management occupa-1 8 1st year, then 1
tions staff ( GS -14, every 2
Step 5). years.
Management analyst 2 8
GS -12, Step 5).
Running Statistical Adjustment Model to Adjust Levels of Performance Based on Ac-
tual Economic Conditions and Characteristics of Participants
Management occupa-1 250 Annual 1
tions staff ( GS -14,
Step 5).
Computer systems ana-2 1, 000
lysts ( GS -13, Step 5)
Licensing fee 10 000
The Departments made the following estimated at 24 hours for each staff adjustment model twice per year as
updates to the Federal -level AEFLA member. required under WIOA. We added two
program, which are presented in Exhibit The Departments also revised the managers at 40 hours each and two
14. We accounted for the additional estimates from the NPRM to include an management analysts at 80 hours each
burden for Federal staff to negotiate important source of Federal burden for to perform these tasks annually.
levels of performance for the new running the new statistical adjustment In addition, the Departments added a
model. In the NPRM, we originally one-time Federal consultant cost of $1performance indicators under WIOA.
We added four managers and four social estimated no hours for this activity. million in the second year to provide
After further review and consideration, technical assistance to States in thecommunity service managers to perform however, we concluded that Federalthese activities. The biennial level of collection of data to comply with the
staff hours will be required annually to new requirements relating to the WIOAeffort for each occupational category is account for running the statistical performance accountability indicators.
EXHIBIT 14— UPDATES TO COSTS OF FEDERAL -LEVEL AEFLA PROGRAMS— DEVELOPMENT AND UPDATING OF STATE
PERFORMANCE ACCOUNTABILITY MEASURES
NPRM Final rule
c) Development and updating of state performance accountability measures c) Performance accountabili y system
Average AverageAverage Number of Average Number of Labor level level number of affected number of affectedFrequency Labor category Frequencyof effort of effort workers entities workers entitiescategory hrs.) hrs.)
N/ A Negotiation of Levels of Performance
1
tions staff ( GS -14, every 2
Step 5).
Management occupa-4 24 1st year, then
years.
55937Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
EXHIBIT 14— UPDATES TO COSTS OF FEDERAL -LEVEL AEFLA PROGRAMS— DEVELOPMENT AND UPDATING OF STATE
PERFORMANCE ACCOUNTABILITY MEASURES— Continued
NPRM Final rule
c) Development and updating of state performance accountability measures c) Performance accountabili y system
Average AverageAverage Number of Average Number of Labor level level number of affected number of affectedFrequency Labor category Frequencyof effort of effort workers entities workers entitiescategory
hrs.) hrs.)
Social & community 4 24
service manager
GS -13, Step 5).
Running Statistical Adjustment Model to Adjust Levels of Performance Based on Ac-
tual Economic Conditions and Characteristics of Participants
Management occupa-2 40 Annual 1
tions staff ( GS -14,
Step 5).
Management analysts 2 80
GS -12, Step 5).
Technical Assistance to States
Consultant cost 1, 000, 000 2nd year 1
Exhibit 15 presents the following For developing and updating State level of effort for the managers is
changes made by the Departments to the performance accountability systems, the estimated at 12 hours each biennially.
Federal level for the VR program. After Departments added two data For adjusting levels of performance, we
consulting with additional program management specialists positions, one added two managers and two database
experts, we accounted for and revised of which will be General Schedule ( GS) -administrators to review the State and
the level of effort needed to develop and level 14 and the other GS -level 13. Both Federal data relative to the adjustments
update State performance accountability specialists will devote 768. 63 hours in made to the levels of performance by the systems, negotiate levels of the first year of the rule to program the final run of the model. The level of
performance, and run the statistical database and perform related software effort for managers is estimated at 52 adjustment model to adjust levels of development tasks. For negotiations, we hours each annually, while the level ofperformance based on actual economic added four managers to reflect the effort for database administrators is
conditions and characteristics of analysis and review of State and Federal estimated at 156 hours each annually.participants. data during the negotiation process. The
EXHIBIT 15— UPDATES TO COSTS OF FEDERAL -LEVEL VR PROGRAMS— DEVELOPMENT AND UPDATING OF STATE
PERFORMANCE ACCOUNTABILITY MEASURES
NPRM Final rule
c) Development and updating of state performance accountability measures c) Performance accountabili y system
Average AverageAverage Number of Average Number of Labor level level number of affected number of affectedFrequency Labor category Frequencyof effort of effort workers entities workers entitiescategory
hrs.) hrs.)
N/N/ AA Development and Updating of State Performance Accountability Systems
Data Management Spe-1 768.768. 6363 OneOne timetime 1.
cialist ( GS -14, Step
5).
Data Management Spe-1 768.63 One time 1.
cialist ( GS -13, Step
5).
Negotiation of Levels of Performance
Management occupa-4 12 1st year, then 1.
tions staff ( GS -14, every 2
Step 5). years.
Running Statistical Adjustment Model to Adjust Levels of Performance Based on Ac-
tual Economic Conditions and Characteristics of Participants
Management occupa-2 52 Annual 1.
tions staff ( GS -14,
Step 5).
Database admin. ( GS— 2 156
13, Step 5).
55938 Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
At the State level for the DOL
programs, the Departments made the
following updates, which are presented
in Exhibit 16. We replaced the technical
staff in our previous estimate with the
more appropriate occupational category
of computer systems analyst. Following
discussions with program experts, we
increased the level of effort for each
administrative staff member from 32 to
72 hours, and we decided that costs
related to the work performed by staff
and the software and IT systems will be
incurred only once rather than annually.
In addition, we accounted for the effort
related to negotiating levels of
performance and adjusting levels of
performance. For negotiations, we
added one manager and two office and
administrative support staff members.
The estimated level of effort for each
staff member in both occupational
categories is 8 hours biennially. For
adjusting levels of performance, we
added one manager, two computer
systems analysts, and two office and
administrative support staff members.
These staff members will gather and
input various data points to the tool,
which then will create statewide levels
of performance for each WIOA
performance indicator. The estimated
annual level of effort for each manager,
computer systems analyst, and office
and administrative support staff
member is 10 hours, 40 hours, and 20
hours, respectively.
EXHIBIT 16— UPDATES TO COSTS OF STATE -LEVEL DOL PROGRAMS— DEVELOPMENT AND UPDATING OF STATE
PERFORMANCE ACCOUNTABILITY MEASURES
NPRM Final rule
c) Development and updating of state performance accountability measures c) Performance accountabili y system
Average AverageAverage Number of Average Number ofLabor level level number of affected number of affected of effort of effortFrequency Labor category Frequencycategory workers hrs.)
Manager 1 32 Annual
Technical 3 80
Staff.
Admin. staff ... 1 32
Software/ IT 100, 000
systems
cost.
50,000Licensing fee
Consultant 75,000 One time
cost.
The Departments made the following
updates to the State -level AEFLA
program, which are presented in Exhibit
17. For the costs related to developing
and updating State performance
accountability systems, we reduced the
number of managers from five to four
after determining that this number will
reflect more accurately the staffing level
needed across all States and outlying
areas. Three of these staff members are
entities workers entities hrs.)
56 States Development and Updating of State Performance Accountability Systems
Management occupa-
tions staff.
Computer systems ana-
lyst.
Office & admin. support
staff.
Software/ IT systems
cost.
Licensing fee
Consultant cost
Management occupa-
tions staff.
1
3
1
32
80
72
One time 57 SWAB.
100, 000
50, 000 Annual.
75, 000 One time.
Negotiation of Levels of Performance
1 8 1st year, then
every 2
years.
57 States.
Office & admin. support 2 8
staff.
Running Statistical Adjustment Model to Adjust Levels of Performance Based on Ac-
tual Economic Conditions and Characteristics of Participants
Management occupa-
tions staff.
Computer systems ana-
lysts.
Office & admin. support
staff.
categorized as social and community
service managers, and we decreased the
level of effort per staff member from 80
hours to 60 hours. We replaced the two
technical staff in our previous estimate
with the more appropriate occupational
categories of database administrator and
computer systems analyst. After
consideration, we revised the
calculation to exclude the five
administrative staff members included
1 10 Annual 57 States.
2 40
2 20
in our previous estimate, because those
occupational categories are generally
not involved in these tasks. We
eliminated a one-time consultant cost
because we have concluded that
consultants are typically not engaged in
this task. We added an annual $ 350, 000
software and IT systems cost for the
State AEFLA data system. This annual
350,000 software and IT systems cost
replaces one-time and annual State
55939Federal Register / Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
software and IT systems costs that were
previously attributed in the NPRM to
provisions (i) " Performance Reports"
and (j) " Evaluation of State Programs."
We have concluded that using annual
State software and IT systems costs,
rather than one-time software and IT
systems costs, more accurately reflects
the typical IT funding pattern of the
State -level AEFLA program.
These changes also are based on the
review of public comments, which
resulted in a decision by the
Departments that each exit by a
participant during a program year will
count as a separate response to be used
for data collection and outcome
reporting for the performance
indicators. Prior to WIOA, the AEFLA
program reported only unduplicated
counts of participant outcomes. Making
the change to an accountability
structure that is based on reporting
outcomes for each exit by a participant
during a program year represents a
significant operational change for the
AEFLA program and will require a
commensurate increase in the level of
effort needed for implementation.
In addition, after discussions with
program experts, the Departments
accounted for additional burden for
State staff to negotiate levels of
performance for the new indicators
under WIOA. We added one manager
and one social community service
manager to perform these activities. The
biennial level of effort per staff member
is estimated at 12 hours.
The Departments eliminated the State
burden for running the statistical
adjustment model, after consulting with
statistical experts and determining that
the model will only be run in the
Federal office using aggregate State data.
EXHIBIT 17— UPDATES TO COSTS OF STATE -LEVEL AEFLA PROGRAMS— DEVELOPMENT AND UPDATING OF STATE
PERFORMANCE ACCOUNTABILITY MEASURES
NPRM Final rule
c) Development and updating of state performance accountability measures c Performance accountability system
Labor cat-
egory
Average
number of
workers
Average
level
of effort
hrs.)
Frequency
Number of
affected
entities
Manager 5 80 One time 57 States
Technical
staff.
2 80
Admin. staff 5 80
Consultant
cost.
25 000
AverageAverage Number of level Labor category Frequencynumber of affected of effort workers entities hrs.)
Development and Updating of State Performance Accountability Systems
Management occupa-1 60 One time 57 States.
tions staff.
Computer systems ana-
lyst.
Social & community
service manager.
Database administrator
Software/ IT systems
cost.
Management occupa-
tions staff.
Social & community
service manager.
1 80
3 60
1 80
350,000 Annual.
Negotiation of Levels of Performance
1 12 1st year, then 57 States.
every 2
years.
1 12
Note: Under the " Development and Updating of State Performance Accountability Systems," the software and IT systems costs are a combination of inputs that
were previously accounted for under provisions ( i) ' Performance Reports" and (j) " Evaluation of State Programs."
Exhibit 18 presents the updates to the
State VR program. Based on public
comment and further deliberation, the
Departments significantly revised the
estimated State -level burden associated
with the development and updating of
State VR agency performance
accountability systems. First, to more
appropriately account for the burden
associated with the establishment of
State performance goals and the State' s
evaluation and analysis of progress
toward such goals, the Departments
reduced the number of managers from
six to four, three of which are
categorized as social and community
service managers, and replaced the four
technical staff with two database
administrators. However, this decrease
in the number of staff is offset by the
increase in the level of effort from 10 to
80 hours for managers and 10 to 100
hours for database administrators. We
also included SRC members because
they will need to play an advisory role
in developing and updating levels of
performance for the State VR agency.
These costs will occur biennially.
Although the Departments estimate
that each VR agency will require
computer systems analysts for this one-
time task, the related burden for
changing a State' s CMS has been broken
down to reflect the variation among the
80 State VR agencies with respect to
their size and whether they contract for
outside assistance for developing and
maintaining their CMS. For example,
the level of effort for the 30 VR agencies
that have a maintenance contract with a
CMS vendor to make system updates
will be less than the 50 agencies that are
without vendor support. The burden
hours shown in Exhibit 18 for tasks to
be carried out by computer systems
analysts has been adjusted to reflect
only those hours we attribute to new
requirements under sec. 116 in title I of
WIOA. The remaining hours related to
this new burden are accounted for in the
RIA accompanying the final regulations
for " State Vocational Rehabilitation
Services Program; State Supported
Employment Services Program;
Limitations on Use of Subminimum
Wage," which is published in this
edition of the Federal Register. We also
55940 Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
added the proportional cost of annual
licensing fees of $6, 930 for 48 VR
agencies for vendor -supplied CMS
software.
In addition, following discussions
with program experts, the Departments
accounted for and revised the level of
effort needed to negotiate and adjust
levels of performance and we are adding
one manager, two social and community
service managers, and two management
analysts to accommodate the increased
level of effort. Similarly, we used input
from public comment and program
experts to revise the level of effort
needed to apply the statistical
adjustment model and we are adding
one manager, one computer systems
analyst, one database administrator, and
one management analyst to account for
the effort needed to integrate the
statistical adjustment model into the
process of establishing expected levels
of performance and negotiated levels of
performance.
In response to public comment and
discussions with program experts, the
Departments have included the
estimated burden for obtaining UI Wage
Data by VR Agencies. The estimates
reflect that VR agencies will incur new
costs for obtaining UI wage data on
participants that exit the program after
receiving services and will incur
different levels of annual data query
costs related to obtaining UI wage data,
depending on the size of the agency.
State VR agencies operating under the
increased data and performance
requirements of WIOA will also need
the capability to analyze their program
performance data more effectively. In
response to public comment, we added
a new software and IT systems cost for
data analytic software and related
training. The amount of the software
and IT systems costs varies, depending
on the size of the agency.
EXHIBIT 18— UPDATES TO COSTS OF STATE -LEVEL VR PROGRAMS— DEVELOPMENT AND UPDATING OF STATE
PERFORMANCE ACCOUNTABILITY MEASURES
NPRM
c) Development and updating of state performance accountability measures
AverageAverage Number of Labor level number of affectedFrequencyof effort workers entitiescategory
hrs.)
Manager 6 10 One time 80 VR agen-
cies.
Technical 4 10
staff.
Final rule
c Performance accountability system
AverageAverage Number of level Labor category Frequencynumber of affected of effort workers entities hrs.)
Development and Updating of State Performance Accountability Systems
Management occupa-80 1st year, then 80 VR
tions staff.
Social & community
service manager.
Database administrator
SRC Board members ...
Computer systems ana-
lyst.
Licensing fee
Management occupa-
tions staff.
Social & community
service manager.
Management analyst ....
every 2
years.
agen-
cies.
3 80
2 100
12 3
5 360 One time 5 ( large)
VR
agencies
w/o ven-
dor sup-
port.
2 360 45 (small &
med.)
VR
agencies
w/o ven-
dor sup-
port.
2 54 30 VR
agencies
w/CMS
vendor
con-
tracts.
6, 930 Annual 48 VR
agen-
cies.
Negotiation of Levels of Performance
12 1st year, then
every 2
years.
80 VR
agen-
cies.
2 12
2 12
55941Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
EXHIBIT 18— UPDATES TO COSTS OF STATE -LEVEL VR PROGRAMS— DEVELOPMENT AND UPDATING OF STATE
PERFORMANCE ACCOUNTABILITY MEASURES— Continued
NPRM Final rule
c) Development and updating of state performance accountability measures c) Performance accountability system
Average AverageAverage Number of Average Number of Labor level level number of affected number of affectedFrequency Labor category Frequencyof effort of effort workers entities workers entitiescategory
hrs.) hrs.)
Running Statistical Adjustment Model to Adjust Levels of Performance Based on Ac-
tual Economic Conditions and Characteristics of Participants
Management occupa-1 4 Annual 80 VR
tions staff. agen-
cies.
Computer systems ana-1 4
lyst.
Database administrator 1 20
Management analyst .... 1 4
Obtain UI Wage Data
20, 000 Annual 10 ( large)
VR
Data query cost
agen-
cies.
8,000 42 (med.)
VR
agen-
cies.
4,000 28 (small)
VR
agen-
cies.
Data Analytic Software and Training
Software/ IT systems 25, 000 One time 10 ( large)
cost. VR
agen-
cies.
15, 000 42 ( med.)
VR
agen-
cies.
10,000 28 (small)
VR
agen-
cies.
At the local level for the DOL performance biennially. The biennial model annually. The estimated annual
programs, the Departments made the level of effort per staff member for both level of effort per staff member for the
following updates, which are presented occupational categories is estimated at 8 manager, computer systems analysts,
in Exhibit 19. Based on discussions with hours. We also added one manager, two and administrative staff members is 10
program experts, we added one manager computer systems analysts, and two hours, 40 hours, and 20 hours,
and two office and administrative office and administrative support staff respectively. support staff members to account for the members to account for the effort
effort needed to negotiate levels of needed to run the statistical adjustment
55942 Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
EXHIBIT 19— UPDATES TO COSTS OF LOCAL -LEVEL DOL PROGRAMS— DEVELOPMENT AND UPDATING OF STATE
PERFORMANCE ACCOUNTABILITY MEASURES
NPRM Final rule
c) Development and updating of state performance accountability measures c) Performance accountability system
Average AverageAverage Number of Average Number of Labor level Labor level number of affected number of affectedFrequency Frequencyof effort of effort workers entities workers entitiescategory category
hrs.) hrs.)
N/ A Negotiation of Levels of Performance
Management occupa-1 8 1st year then 580 Local
tions staff. every 2 WDBs.
years.
Office & admin. occupa-2 8
tions staff.
Running Statistical Adjustment Model to Adjust Levels of Performance Based on Ac-
tual Economic Conditions and Characteristics of Participants
Management occupa-1 10 Annual 580 Local
tions staff. WDBs.
Computer systems ana-2 40
lysts.
Office & admin. support 2 20
staff.
Exhibit 20 presents the updates to the office, to develop and update State Note that instead of presenting the costs
local -level AEFLA program. The at the State level as in the NPRM, we areperformance accountability measures.
Departments considered the typical We found that the level of effort for presenting costs at the program, or local,
experience of local involvement and local AEFLA programs will be level using the total number of local
concluded that local staff will significantly less than previously AEFLA programs reflected in actual
participate in statewide stakeholder expected because their role would be program data submitted by States for the
meetings, convened by the State AEFLA most recent reporting year.limited to those stakeholder meetings.
EXHIBIT 20— UPDATES TO COSTS OF LOCAL -LEVEL AEFLA PROGRAMS— DEVELOPMENT AND UPDATING OF STATE
PERFORMANCE ACCOUNTABILITY MEASURES
NPRM Final rule
c) Development and updating of state performance accountability measures c Performance accountability system
Average AverageAverage Number of Average Number of Labor level level number of affected number of affectedFrequency Labor category Frequencyof effort of effort workers entities workers entities hrs.) hrs.)
category
Manager 40 80 One-time 57 States Development and Updating of State Performance Accountability Systems
Technical 40 80 Management occupa-1 4 One-time 2,396 local
staff. tions staff. pro-
grams.
Database administrator 1 4
Identification and Dissemination of Best Identification and Dissemination of WIOA Final Rule. Therefore, this
Practices Best Practices" in the NPRM are more provision and its costs that result from
appropriate in the DOL WIOA Final the inputs presented in Exhibit 21 ($ 2. 9
After further consideration, the Rule because the requirements affect million) are no longer included in the Departments decided that the costs only State WDBs. This provision now economic analysis for this Final Rule.
associated with provision (d) can be found as provision (c) in the DOL
55943
EXHIBIT 21— UPDATES TO COSTS OF LOCAL -LEVEL DOL STATE WDBS— IDENTIFICATION AND DISSEMINATION OF BEST
Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
PRACTICES
NPRM Final rule
d) Identification and dissemination of best practices Moved to DOL WIOA final rule
Average AverageAverage Number of Average Number of Labor level level number of affected number of affected of effort of effortFrequency Labor category Frequencycategory workers hrs.)
Manager 1 20 One-time
Technical 2 40
staff.
Admin. staff 1 20
Development of Strategies for Aligning
Technology and Data Systems Across
One -Stop Partner Programs To Enhance
Service Delivery and Improve
Efficiencies
This section describes the updates to
the NPRM' s provision (e) " Development
of Strategies for Aligning Technology
and Data Systems across One -Stop
Partner Programs to Enhance Service
Delivery and Improve Efficiencies." In
the Final Rule' s subject -by -subject
analysis, this cost provision is combined
into provision (c) " Performance
Accountability System," and it captures
the cost of aligning technology and data
systems across one-stop partner
programs. For this activity, the total 10 -
entities workers entities hrs.)
40 States N/ A. See DOL WIOA Final Rule
year cost (undiscounted) decreased from
356.6 million in the NPRM to $166. 5
million in the Final Rule.32 These
revised cost estimates can be found
under the subsection " Development and
Updating of State Performance
Accountability Systems" in provision
c) of the Final Rule.
Exhibit 22 presents the changes made
by the Departments for the State
Workforce Agencies (SWAs) State -level
program. After further consideration, we
removed the manager and technical staff
members and replaced them with
consultant and software and IT systems
costs. We estimated that the 23 SWAs
that are farther in the process of aligning
their technology and data systems will
incur $100, 000 in first-year consultant
costs for designing the new systems,
200, 000 in first-year software and IT
systems costs for purchasing hardware
and implementing the new systems, and
100,000 in software and IT systems
costs in the following 2 years for system
maintenance. We estimate that the 34
SWAs that use legacy systems will
require more effort to align their
technology and data systems. These
SWAs will incur $200, 000 in first-year
consultant and software and IT system
costs; $ 100, 000 and $ 200, 000 in second -
year consultant and software and IT
system costs, respectively; and $100,000
in software and IT systems costs for
maintenance in the third through fifth
years.
EXHIBIT 22— UPDATES TO COSTS OF SWA— DEVELOPMENT OF STRATEGIES FOR ALIGNING TECHNOLOGY AND DATA
SYSTEMS ACROSS ONE-STOP PARTNER PROGRAMS
NPRM
e) Development of strategies for aligning technology and data systems
across one-stop partner programs
Average
Labor
category
Average
number of
workers
level
of effort
hrs.)
Frequency
Number of
affected
entities
Manager 80 One time 56 States
Technical 2 120
staff.
Final rule
c Performance accountability system
AverageAverage Number oflevel Labor category Frequencynumber of affected of effort workers entities hrs.)
Aligning Technology and Data Systems across One-stop Partner Programs
Consultant cost (" Low -
Effort" SWAB).
Software and IT sys-
tems cost (" Low -Ef-
fort" SWAB).
Software and IT sys-
tems cost (" Low -Ef-
fort" SWAB).
Consultant cost (" High -
Effort" SWAB).
Consultant cost (" High -
Effort" SWAB).
Software and IT sys-
tems cost (" High -Ef-
fort" SWAB).
100, 000 One time 23 SWAB.
200,000 One time.
100, 000 2nd & 3rd
years.
200,000 One time 34 SWAB.
100, 000 2nd year.
200,000 1st & 2nd
years.
32 The variance in cost is due to changes to the the removal of the local -level AEFLA program costs.frequency.) More specifically, this variance in cost
assumptions used to estimate costs ( e. g., number of The Final Rule does not implement any policyis due to the reduction in annual software and IT
staff, occupational categories, level of effort, and systems cost for the State -level AEFLA program and changes over the NPRM that impact this cost.
55944 Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
EXHIBIT 22— UPDATES TO COSTS OF SWA— DEVELOPMENT OF STRATEGIES FOR ALIGNING TECHNOLOGY AND
SYSTEMS ACROSS ONE-STOP PARTNER PROGRAMS— Continued
NPRM Final rule
e) Development of strategies for aligning technology and data systems c) Performance accountability system
across one-stop partner programs
AverageAverage AverageAverage Number of level Labor level Labor category number of Frequencynumber of affected of effortFrequencyof effort workerscategory workers hrs.)
For the AEFLA State -level program,
the Departments made the following
updates, which are shown in Exhibit 23.
We removed the labor costs because
these occupational categories are not
generally involved in aligning
technology and data systems. The
annual software and IT systems cost
decreased from $ 150, 000 to $ 100, 000
category workers hrs.)
Manager 5 40 Annual
Technical 2 120
staff.
Admin. staff 5 40
Software/ IT 150, 000
systems
cost.
The Departments made the following
changes to the VR program cost burden
at the State level, which are presented
in Exhibit 24. After further
consideration, we removed the
managers as well as the counsel and
technical staff members and replaced
them with consultant and software and
IT systems costs. We estimated that the
32 VR agencies that are further in the
process of aligning their technology and
entities
Software and IT sys-
tems cost (" High -Ef-
fort" SWAB).
because we were initially accounting for
some costs that are now accounted for
in the costs for performance reports
under provision (c) of the Final Rule. As
a result of the opportunities created for
greater program coordination under
WIOA, we estimate that AEFLA State
agencies will enhance their
participation in the SLDS Grant
hrs.)
100, 000 3rd -5th years.
Program, which supports the design,
development, implementation, and
expansion of P -20W (early learning
through the workforce) longitudinal
data systems. 33 The annual IT systems
cost of $100, 000 estimated in Exhibit 23
accounts for this work.
DATA
Number of
affected
entities
EXHIBIT 23— UPDATES TO COSTS OF STATE -LEVEL AEFLA PROGRAMS— DEVELOPMENT OF STRATEGIES FOR ALIGNING
TECHNOLOGY AND DATA SYSTEMS ACROSS ONE-STOP PARTNER PROGRAMS
NPRM Final rule
e) Development of strategies for aligning technology and data systems c Performance accountability system
across one-stop partner programs
AverageAverage Average Number ofAverage Number of level Labor level Labor category number of Frequency affected number of affected of effort of effort workers entitiesFrequency
entities hrs.)
57 States Aligning Technology and Data Systems across One-stop Partner Programs
Software/ IT systems
cost.
data systems will incur $100, 000 in
first-year consultant costs for designing
the new systems, $ 200,000 in first-year
software and IT systems costs for
purchasing hardware and implementing
the new systems, and $ 100, 000 in
software and IT systems costs in each of
the following 2 years for system
maintenance. We estimate that the 48
VR agencies that use legacy systems will
require more effort to align their
100, 000 Annual 57 States.
technology and data systems. These VR
agencies will incur $200,000 in first-
year consultant and software and IT
system costs; $100,000 and $200,000 in
second -year consultant and software
and IT system costs, respectively; and
100,000 in software and IT systems
costs for maintenance in each year from
the third through fifth years.
33 For more information on the SLDS Grant Institute of Education Sciences, National Center for Education Statistics' Web site: https:// nces. ed.gov/
Program, see the U. S. Department of Education, programs/ sl ds/ abo utSLDS.asp.
55945
EXHIBIT 24— UPDATES TO COSTS OF STATE -LEVEL VR PROGRAMS— DEVELOPMENT OF STRATEGIES FOR ALIGNING
Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
TECHNOLOGY AND DATA SYSTEMS ACROSS ONE-STOP PARTNER PROGRAMS
NPRM
e) Development of strategies for aligning technology and data systems
across one-stop partner programs
AverageAverage Number of Labor level number of affectedFrequencyof effortcategory workers hrs.)
Manager 1 8 Annual
Counsel 1 4
staff.
Technical 1 16
staff.
For the AEFLA program at the local
level, the Departments made the
following changes, which are shown in
Exhibit 25. We have concluded that
category workers hrs.)
Manager 40 40 Annual
Technical 40 120
staff.
Unified or Combined State Plan
This section describes the updates to
the NPRM' s provision (f) "Unified or
Combined State Plans." In this Final
Rule' s subject -by -subject analysis, this
cost provision has been included in
provision (b) " Unified or Combined
State Plans: Expanded Content, Biennial
Development and Modification Process,
and Submission Coordination
Requirements," and it captures the cost
of (1) reviewing and developing new 4 -
entities
80 VR agen-
cies.
Final rule
c Performance accountability system
AverageAverage level number ofLabor category Frequencyof effort workers hrs.)
Number of
affected
entities
Aligning Technology and Data Systems across One -Stop Partner Programs
Consultant cost (" Low-
Effort" VR agencies).
Software and IT sys-
tems cost (" Low -Ef-
fort" VR agencies).
Software and IT sys-
tems cost (" Low-Ef-
fort" VR agencies).
Consultant cost (" High-
Effort" VR agencies).
Consultant cost (" High-
Effort" VR agencies).
Software and IT sys-
tems cost (" High-Ef-
fort" VR agencies).
Software and IT sys-
tems cost (" High -Ef-
fort" VR agencies).
local AEFLA staff will not bear the
burden for aligning technology and data Therefore, we removed all cost inputs at
systems because AEFLA data are the local level related to this provision.
collected and maintained at the State
EXHIBIT 25— UPDATES TO COSTS OF LOCAL -LEVEL AEFLA PROGRAMS— DEVELOPMENT OF STRATEGIES FOR ALIGNING
TECHNOLOGY AND DATA SYSTEMS ACROSS ONE-STOP PARTNER PROGRAMS
NPRM Final rule
e) Development of strategies for aligning technology and data systems N/A
across one-stop partner programs
AverageAverage Average Number of Average Number of level Labor level Labor category number of Frequency affected number of affected of effort of effort workers entitiesFrequency
entities
57 States
year Unified or Combined State Plans to
ensure they satisfy the new content
requirements and ( 2) coordinating
actions for developing new 4 -year
Unified or Combined State Plans among
the core programs administered by the
Departments. For these activities, the
total 10 -year cost (undiscounted)
decreased from $17. 2 million in the
NPRM to $ 9. 6 million in this Final
100, 000 One time 32 VR
agen-
cies.
200,000 One time.
100, 000 2nd & 3rd
years.
200,000 One time 48 VR
agen-
cies.
100, 000 2nd year.
200,000 1st & 2nd
years.
100, 000 3rd -5th years.
level in each State and outlying area.
hrs.)
N/ A
Rule. 34 These revised cost estimates can
be found under the subsections
Expanded Content" and " Coordinating
Submission of State Plans" in provision
b) of this Final Rule.
At the State level for the DOL
programs, the Departments made the
34 This variance in cost is mainly due to the
reduction in the number and types of workers
expected to incur incremental cost for the local -
level AEFLA program and a reduction in their level
of effort.
55946 Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
following updates, which are presented
in Exhibit 26: ( 1) We added a one-time
cost to review and revise existing plans
to ensure they include the new
elements; ( 2) we concluded the costs
will be incurred biennially rather than
only in the second and sixth years of the
analysis period; (3) we reduced the
number of managers from two to one
along with their level of effort; (4) we
removed the lawyers; (5) we replaced
the four technical staff members in our
previous estimate with the more
appropriate management analyst
occupational category; and (6) we
reduced the level of effort per analyst
from 20 to 8 hours.
EXHIBIT 26— UPDATES TO COSTS OF LOCAL -LEVEL DOL STATE WDBS— UNIFIED OR COMBINED STATE PLAN
NPRM Final rule
f) Unified or Combined State Plan b) Unified or Combined State Plans: Expanded Content, Biennial Development and
Modification Process, and Submission Coordination Requirements
AverageAverage Number of AverageLabor level Average number of Frequency affected level category Labor category Frequencyof effort number of workers entities of effort hrs.) workers hrs.)
Manager 2 20 2nd & 6th years 56 States Expanded Content
Number of
affected
entities
Counsel staff 8
Technical 4 20
staff.
Admin. staff 8
The Departments made the following
updates to the State -level AEFLA
program, which are presented in Exhibit
27. After consulting with additional
program experts, we added a one-time
cost to review and revise existing plans
to ensure that they include the new
elements. We concluded that the costs
for coordinating submissions will be
incurred biennially rather than only
once. We reduced the number of
managers from five to one, which is a
more accurate reflection of typical
staffing in a State adult education office,
and reduced the level of effort because
we have concluded that the process of
Management occupations 4 20 One time 57 states.
staff.
Lawyer 8
Social & community serv-2 20
ice manager.
Office & admin. support 8
staff.
Coordinating Submission of State Plans
Management occupations
staff.
Management analyst
Office & admin. support
staff.
coordinating the submission of the State
Plan does not require the level of effort
we initially estimated. We decreased the
lawyer' s level of effort from 8 to 4 hours
because we have concluded that the
process of coordinating the submission
the State Plan does not require the level
of effort we initially estimated. We
clarified that the work done by the two
technical staff will be done by three
social and community service managers
because we have concluded that
technical staff members are typically not
involved in the process of coordinating
the submission of the State Plan. We
also decreased the number of
8 1st year, then 57 states.
every 2
years.
2 8
8
administrative staff from five to one,
which is a more accurate reflection of
typical staffing in a State adult
education office, and halved the level of
effort for the staff member because we
have concluded that the process of
coordinating the submission of the State
Plan does not cumulatively require
more than 1 full day of work for the
administrative staff member. Finally, we
removed the $ 25, 000 consultant cost
because we have concluded that a
consultant is not required for the
submission of the State Plan.
EXHIBIT 27— UPDATES TO COSTS OF STATE -LEVEL AEFLA PROGRAMS— UNIFIED OR COMBINED STATE PLAN
NPRM Final rule
f) Unified or Combined State Plan b) Unified or Combined State Plans: Expanded Content, Biennial Development and
Modification Process, and Submission Coordination Requirements
AverageAverage Number of AverageLabor level Average Number of number of Frequency affected Labor level category Frequencyof effort number of affected workers entities of efforthrs.) workers entitiescategory
hrs.)
Manager 24 One time 57 states Expanded Content
Counsel staff Management occupations 20 One time 57 States.
staff.
55947Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
EXHIBIT 27— UPDATES TO COSTS OF STATE -LEVEL AEFLA PROGRAMS— UNIFIED OR COMBINED STATE PLAN— Continued
NPRM
f) Unified or Combined State Plan
AverageAverageLabor level number of Frequencyof effortcategory workers hrs.)
Technical 2 24
staff.
Admin. staff 5 16
Consultant 25 000
cost.
Exhibit 28 presents the changes made
by the Departments to the State level for
the VR program. After further
consideration, we added a one-time cost
to review and revise existing plans to
ensure they include the new elements.
Number of
affected
entities
Final rule
b) Unified or Combined State Plans: Expanded Content, Biennial Development and
Modification Process, and Submission Coordination Requirements
AverageAverage Number of Labor level number of affectedFrequencyof effort workers entitiescategory
hrs.)
Lawyer 1 20
Social & community serv-3 20
ice manager.
Coordinating Submission of State Plans
Management occupations
staff.
Lawyer
Social & community serv-
ice.
Office & admin. support
staff.
We concluded that these costs for
coordinating submissions will be
1 8 1st year, then 57 States.
every 2
years.
1 4
3 8
1 8
technical staff in our previous estimate
with the more appropriate occupational
incurred biennially rather than annually category of social and community
and we doubled the level of effort per service manager.
manager and social and community
service manager. We replaced the
EXHIBIT 28— UPDATES TO COSTS OF STATE -LEVEL VR PROGRAMS— UNIFIED OR COMBINED STATE PLAN
NPRM Final rule
f) Unified or Combined State Plan b) Unified or Combined State Plans: Expanded Content, Biennial Development and
Modification Process, and Submission Coordination Requirements
AverageAverage Number of Labor level number of Frequency affected Labor of effortcategory workers hrs.)
Manager 2 7 Annual
Technical 2 7
staff.
The Departments made the following
changes to the local -level AEFLA
program, which are presented in Exhibit
29. We considered the typical
experience of local involvement and
concluded that local staff will
participate in statewide stakeholder
entities category
80 VR agen-
cies.
Management occupations
staff.
Social & community serv-
ice manager.
AverageAverage level number of of effort workers hrs.)
Expanded Content
Frequency
Number of
affected
entities
2
2
21
21
One time 80 VR
agen-
cies.
Coordinating Submission of State Plans
Management occupations
staff.
Social & community serv-
ice manager.
meetings, convened by the State AEFLA
office, to examine State Plan elements in
need of modification and to gather input
for those revisions. Therefore, we
reduced the number of managers and
removed the lawyers, technical and
administrative staff, and local
2 14 1st year, then 80 VR
agen-
years. cies.
every 2
2 14
stakeholders and replaced them with
social and community service managers.
Note that instead of presenting the costs
at the State level as in the NPRM, we are
presenting costs at the program level.
55948 Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
EXHIBIT 29— UPDATES TO COSTS OF LOCAL -LEVEL AEFLA PROGRAMS— UNIFIED OR COMBINED STATE PLAN
NPRM Final rule
f) Unified or combined state plan c) Unified or combined state plans: Expanded content, biennial development and
modification process, and submission coordination requirements
Average
Labor
category
Average
number of
workers
level
of effort
hrs.)
Frequency
Number of
affected
entities Labor category
Average
number of
workers
Average
level
of effort
hrs.)
Frequency
Number of
affected
entities
Manager 40 24 One time 57 States Coordinating Submission of State Plans
Counsel 3 8 Management occupa-1 4 1st year, then 2, 396 local
staff. tions staff. every 2 pro-
years. grams.
Technical 40 24 Social & community 1 4
staff. service manager.
Admin. staff 40 16
Local stake-100 8
holder.
Local Plan Revisions appropriate in the DOL WIOA Final Rule. Therefore, this provision and its
Rule. The costs associated with this costs that result from the inputsAfter further consideration, the
provision now can be found under presented in Exhibit 30 ($ 22. 6 million)Departments decided that the costs
provision (m) " Local and Regional Plan are no longer included in this Final Ruleassociated with provision (g) " Local
Plan Revisions" in the NPRM are more Modification" in the DOL WIOA Final economic analysis.
EXHIBIT 30— UPDATES TO COSTS OF LOCAL -LEVEL PROGRAMS— LOCAL PLAN REVISIONS
NPRM Final rule
g) Local plan revisions Moved to the DOL WIOA final rule
Average AverageAverage Number of Average Number of Labor level level number of affected number of affectedFrequency Labor category Frequencyof effort of effort workers entities workers entitiescategory
hrs.) hrs.)
Manager 2 20 2nd & 6th
years.
Counsel
staff.
1 8
Technical
staff.
4 20
Admin. staff 1 8
Manager 40 24 One time
Technical 40 24
staff.
Admin. staff 40 16
Local stake-100 8
holders.
State Performance Accountability
Measures
This section describes the updates to
the NPRM' s provision (h) " State
Performance Accountability Measures,"
which in this Final Rule' s subject -by -
subject analysis is included in provision
c) " Performance Accountability
System." This provision captures the
cost of collecting data to report on any
additional State performance
Workforce Development Board Costs
580 Local N/ A. See DOL WIOA Final Rule
WDBs.
AEFLA Program Costs
57 States N/ A. See DOL WIOA Final Rule
revised cost estimates can be found
a State pursuant to WIOA sec. under the subsections " Additional State
116(b)( 2)( B). For this activity, the total Performance Accountability Indicators
10 -year cost (undiscounted) decreased Beyond Required Performance
from $11. 7 million in the NPRM to Indicators)" in provision (c) of the Final
170, 000 in the Final Rule. 35 These Rule.
accountability indicators established by
At the State level for the DOL
programs, the Departments made the35 The variance in cost is mainly due to changes
for State -level DOL programs including: a reduction
in the level of effort per worker; costs incurred once software and IT systems costs and licensing fees
rather than annually; and the removal of annual and one-time consultant costs.
Federal Register/ Vol. 81, No. 161 / Friday, August 19,
following updates, which are presented level of effort for managers; ( 3) we
in Exhibit 31. After discussions with replaced the technical staff in our
additional program experts, we made previous estimate with the more
55949
level of effort from 32 to 36 hours; and
2016 / Rules and Regulations
5) we removed the software and IT
systems cost, licensing fees, and
the following updates: ( 1) We concluded appropriate occupational category of consultant cost.
that costs will be incurred only once computer systems analyst and halved
rather than annually; (2) we halved the their level of effort; (4) we increased the
EXHIBIT 31— UPDATES TO COSTS OF STATE -LEVEL DOL PROGRAMS— STATE PERFORMANCE ACCOUNTABILITY MEASURES
Labor
category
Manager
Technical
staff.
Admin. staff
Software/ IT
systems
cost.
Licensing
fee.
Consultant
cost.
NPRM
h) State performance accountability measures
AverageAverage level number of Frequencyof effort workers hrs.)
1 32 Annual
3 80
1 32
100, 000
50, 000
75, 000 One time
The Departments made the following
updates at the State level for the AEFLA
program, which are presented in Exhibit
32. We increased the hours for all State
staff and reduced the number of
management staff members from five to
four after determining the number
needed to reflect a staffing level that is
Final rule
c) Performance accountability measures
Number of
affected Labor category
Average
number of
Average
level
of effort Frequency
entities workers hrs.)
Number of
affected
entities
5 States Additional State Performance Accountability Indicators ( Beyond Required Perform-
Management occupa-
tions staff.
Computer systems ana-
lyst.
Office & admin. support
staff.
more representative of the States and
outlying areas. Three of these managers
are categorized as social and community
service managers. We replaced the two
technical staff members in our previous
estimate with the more appropriate
occupational categories of database
administrators and computer systems
ance Indicators)
1 16 One time 5 States
3 40
1 36
analysts. We revised the calculation to
exclude the five administrative staff
members included in our previous
estimate, because those occupational
categories generally would not be
involved in the development of
additional State performance
accountability measures.
EXHIBIT 32— UPDATES TO COSTS OF STATE -LEVEL AEFLA PROGRAMS— STATE PERFORMANCE ACCOUNTABILITY
MEASURES
NPRM
h) State performance accountability measures
AverageAverage Number of Labor level number of affectedFrequencyof effort workers entitiescategory
Manager
Technical
staff.
Admin. staff
hrs.)
5 7 One time 5 States
2 7
5 7
Exhibit 33 presents the changes made
by Departments for the State -level VR
program. After additional discussion
with our program experts, we became
aware that the estimated burden for
obtaining UI wage data in the NPRM
Final rule
c) Performance accountability measures
AverageAverage Number of level Labor category Frequencynumber of affected of effort workers entities hrs.)
Additional State Performance Accountability Indicators (Beyond Required Perform-
Management occupa-
tions staff.
Computer systems ana-
lyst.
Social & community
service manager.
Database administrator
was not related to the additional State
performance indicators. In this Final
Rule, the burden will be for 80 State VR
agencies to obtain UI wage data for the
reporting on the primary indicators of
performance, which is included in
ance Indicators)
1 8 One time 5 States.
1 8
3 8
1 8
Exhibit 18. In addition, due to public
comment and additional consultation
with program experts, we reduced the
number of VR agencies that will incur
costs related to the additional State
performance accountability indicators
55950 Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
from seven to five and decreased the subsection on " Additional State consideration, we concluded that this
level of effort from 9 to 8 hours for each Performance Accountability Indicators software cost applies only to data
occupational category. We removed the Beyond Required Performance collection for the primary indicators of
software and IT systems costs from the Indicators)" because upon further performance.
EXHIBIT 33— UPDATES TO COSTS OF STATE -LEVEL VR PROGRAMS— STATE PERFORMANCE ACCOUNTABILITY MEASURES
NPRM
h) State performance accountability measures
AverageAverageLabor level number of Frequencyof effortcategory workers hrs.)
Obtain Quarterly State UI Wage Data
Manager 2 20 One time
Counsel 1 20
staff.
Technical 2 20
staff.
Obtain Additional Information for New Data Fields
Technical 60 9 Annual 7 VR agencies.
staff.
Software/ IT 5, 000 One time.
systems
cost.
At the local level for the AEFLA
program, the Departments made the
following changes, which are presented
in Exhibit 34. We considered the typical
experience of local involvement and
concluded that local staff will
EXHIBIT 34— UPDATES TO COSTS OF LOCAL -LEVEL AEFLA PROGRAMS— STATE PERFORMANCE ACCOUNTABILITY
Labor
category
Manager
Technical
staff.
MEASURES
NPRM Final rule
h) State performance accountability measures c Performance accountability system
Average
number of
Average
level
of effort Frequency
Number of
affected Labor category
Average
number of
Average
level
of effort Frequency
workers hrs.)
40 7 One time
40 7
Performance Reports
This section describes the updates to
the NPRM' s provision (i) " Performance
Reports." In the Final Rule, this cost
provision has been included in
provision (c) " Performance
Accountability System" and it captures
the costs of developing a performance
template that reports outcomes via the
new WIOA performance accountability
metrics; developing, updating, and
submitting ETP reports; and collecting,
Number of
affected
entities
7 VR agencies
Final rule
c) Performance accountability measures
AverageAverage Number of level number of affected of effort workers entities hrs.)
Labor category Frequency
Additional State Performance Accountability Indicators (Beyond Required Perform-
Management occupa-
tions staff.
Computer systems ana-
lyst.
Social & community
service manager.
Database administrator
participate in statewide stakeholder
meetings, convened by the State AEFLA
office, to develop and update the
additional State performance
accountability measures. Therefore, we
reduced the level of effort from 7 to 4
ance Indicators)
1 8 One time 5 VR agen-
cies.
1 8
3 8
1 8
hours. Note that instead of presenting
the costs at the State level as in the
NPRM, we are presenting costs at the
program, or local, level.
entities workers hrs.)
Number of
affected
entities
5 States Additional State Performance Accountability Indicators (Beyond Required Perform-
Management occupa-
tions staff.
Database administrator
analyzing, and reporting performance
data. For this activity, the total 10 -year
cost (undiscounted) increased from
121. 9 million in the NPRM to $295.4
million in the Final Rule.36 37 These
36 A portion of the $ 295 4 million in costs
accounts for software and IT systems costs from
provision ( e) " Development of Strategies for
Aligning Technology and One -Stop Partner
Programs" and provision (j) " Evaluation of State
Programs." Thus, this value overstates how much
costs have increased in this Final Rule relative to
the NPRM.
ance Indicators)
1 4 One time 200 local
pro-
grams.
1 4
revised cost estimates can be found
under the subsections " Development
and Updating State Performance
Accountability Systems" and
Performance Reports" in provision (c)
of this Final Rule.
39 This variance in cost is due to new annual and
one-time software and IT systems costs for Federal
AEFLA programs, new annual labor costs for the
State -level DOL program, and new one-time and
annual labor costs for the State -level VR program.
55951Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
At the Federal level for the DOL annual burden hours for one manager, estimated annual software and IT
programs, the Departments made the one computer systems analyst, and one systems cost of $250, 000 for ETP
following updates, which are shown in management analyst to implement and reporting.
Exhibit 35. After consultation with review the new ETP performance
additional program experts, we added reporting template. We also added an
EXHIBIT 35— UPDATES TO COSTS OF FEDERAL -LEVEL DOL PROGRAMS— PERFORMANCE REPORTS
NPRM Final rule
i Performance reports c Performance accountability system
Average AverageAverage Number of Average Number ofLabor level level number of affected number of affectedFrequency Labor category Frequencyof effort of effort workers entities workers entitiescategory
hrs.) hrs.)
N/ A Performance Report
Management occupa-1 8 Annual 1
tions staff ( GS -14,
Step 5).
Computer systems ana-1 5
lysts ( GS -13, Step 5).
Management analyst 1 16
GS -12, Step 5).
Software/ IT systems 250,000
cost.
The Departments made the following performed by one manager, one social development, modernization, and
updates for the Federal -level AEFLA enhancement to build the dataand community service manager, and
program, which are presented in Exhibit one database administrator. We reduced infrastructure and increase the capacity
36. We concluded that updating and the level of effort per manager from 60 of the adult education data collection
maintaining the Federal data system for to 8 hours, because most of this work system at the Federal, State, and local
compliance with the new requirements will be performed by the database levels to comply with the new of WIOA will be performed annually administrator. The managers will direct performance reporting requirementsrather than once because Federal data and oversee the modernization process under WIOA. An annual software and
system costs have been historically and the database administrator will IT cost of $250, 000 also has been
incurred annually. We reduced the manage the new system. Finally, we included to maintain the data number of Federal staff members and revised our estimate to add a one-time infrastructure in steady state.clarified that the work will be Federal cost of $5 million for IT systems
EXHIBIT 36— UPDATES TO COSTS OF FEDERAL -LEVEL AEFLA PROGRAMS— PERFORMANCE REPORTS
NPRM Final rule
i Performance reports c Performance accountability system
Average AverageAverage Number of Average Number of Labor level level number of affected number of affectedFrequency Labor category Frequencyof effort of effort workers entities workers entitiescategory
hrs.) hrs.)
Manager 1 60 One time 1 Performance Report
GS -13,
Step 5).
Federal staff 10 15 Management occupa-1 8 Annual 1
GS -13, tions staff ( GS -14,
Step 5). Step 5).
16Social & community 1
service manager
GS -13, Step 5).
Database administrator 1 40
GS -13, Step 5).
Software/ IT systems 250,000
cost.
Software/ IT systems 5,000,000 One time 1
cost.
The Departments made the following program, which are presented in Exhibit IT cost of $68, 925 to support the VR
updates for the Federal -level VR 37. We added a one-time software and program' s ability to compile quarterly
55952 Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
data reported by VR agencies into the
annual reports required under WIOA.
The ED will be developing and
submitting the annual reports based on
quarterly data submitted by the VR
agencies. This cost was not included in
EXHIBIT 37— UPDATES TO COSTS OF FEDERAL -LEVEL VR PROGRAMS— PERFORMANCE REPORTS
category workers hrs.)
N/ A
The Departments made the following
changes for the AEFLA program at the
State level, which are presented in
Exhibit 39. We concluded that the effort
from all relevant staff members will
occur on an annual basis rather than
once. We reduced the number of
managers from five to four after
determining that this number will
reflect more accurately the staffing level
needed across all States and outlying
areas. Three of these staff members are
categorized as social and community
service managers. We replaced the two
technical staff members in our previous
estimate with the more appropriate
the NPRM because at the time the
NPRM was published, the PIRL and
RSA -911 had not been finalized. Since
that time, ED has completed a more
comprehensive analysis of the data
structure required to meet the WIOA
requirements and found that additional
software is necessary to support the
development of the annual reports for
VR agencies by ED.
AverageLabor number of
category workers
NPRM
i Performance reports
Average
level Frequencyof effort
hrs.)
N/ A
Final rule
c Performance accountability system
Number of
affected Labor category
Average
number of
Average
level
of effort Frequency
entities workers hrs.)
Performance Reports
Software/ IT systems 68, 925 One-time
cost.
Number of
affected
entities
Exhibit 38 presents updates to the computer systems analyst, one account for the annual effort related to
State -level DOL program. The management analyst, and one office and ETP reporting.
Departments added one manager, one administrative support staff member to
EXHIBIT 38— UPDATES TO COSTS OF STATE -LEVEL DOL PROGRAMS— PERFORMANCE REPORTS
NPRM Final rule
i Performance reports c Performance accountability system
Average AverageAverage Number of Average Number ofLabor level level number of affected number of affected of effort of effortFrequency Labor category Frequency
entities workers entities
Management occupa-
tions staff.
Computer systems ana-
lyst.
Management analyst ....
Office & admin. support
staff.
occupational categories of database
administrator and computer systems
analyst. We also revised the calculation
to exclude the five administrative staff
members included in our previous
estimate because those occupational
categories are generally not involved
with performance reports. In addition,
we moved the State data system costs to
the subsection under provision (c) on
Development and Updating of State
Performance Accountability Systems"
where more realistic costs will be
captured that States will incur in
establishing the capabilities to collect
the data necessary to calculate the
hrs.)
Performance Reports
1 8 Annual 57 States.
1 40
1 60
4 20
newly required performance measures
see Exhibit 17). We have concluded
that the one-time cost estimate for the
State -level software and IT systems cost
needed to be aligned with actual
funding patterns across all States and
outlying areas and will occur annually.
In addition, we eliminated the recurring
licensing fee, since we accounted for
such fees in the annual cost estimate for
the State data system under the
subsection " Development and Updating
of State Performance Accountability
Systems."
1
55953Federal Register / Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
EXHIBIT 39— UPDATES TO
NPRM
i Performance reports
AverageAverageLabor level
COSTS OF STATE -LEVEL AEFLA PROGRAMS— PERFORMANCE REPORTS
Final rule
c Performance accountability system
AverageNumber of Average Number of level number of affected number of affectedFrequency Labor category Frequencyof effort of effort workers entities workers entitiescategory
hrs.) hrs.)
Manager 5 40 One time 56 States Development and Updating of State Performance Accountability Systems
Technical 2 40
staff.
Admin. staff 5 40
Software/IT 1, 750,000
cost.
Licensing 25, 000 Annual
fee.
At the State level for the VR program,
the Departments made the following
changes, which are presented in Exhibit
40. We added one manager, one
computer systems analyst, two social
and community service managers, and
one database administrator to address
the State -level effort involved in
reviewing and verifying the annual
performance report that RSA will
assemble from the quarterly RSA -911
data the States have previously
reported.
In response to comments, the
Departments have included the burden
associated with the training of VR staff
on the collection of new data and
related data collection requirements.
Based on information from the RSA -2
Cost Report, we use an average of 62
rehabilitation counselors per VR agency
in calculating this burden and have
added labor burden of 6 hours for one
staff trainer and 3 hours for each of the
62 rehabilitation counselors to
participate in the training.
Software/ IT systems
cost.
Management occupa-
tions staff.
57 States Computer systems ana-
lyst.
Social & community
service manager.
Database administrator
Finally, Exhibit 40 includes the
annual labor for 62 rehabilitation
counselors per VR agency to collect the
new data. The data collection related
labor burden included in this analysis is
limited to the hours the Departments
have attributed to the requirements
under sec. 116 of title I of WIOA
implemented in these joint regulations.
We estimate that approximately 36
percent of all new data elements
required by WIOA are related to
requirements under sec. 116 of title I of
WIOA and have prorated the total
additional data collection burden
accordingly. For the first year of data
collection, VR agencies will incur a
greater data collection burden than in
subsequent years. All VR participants
who are still receiving services (i.e.,
have not exited) by the start of PY 2016
July 1, 2016) become WIOA
participants and will be counted and
tracked in accordance with the WIOA
performance requirements set forth in
sec. 116 of WIOA. Based on State -
350,000 Annual 57 States.
Performance Reports
1 40 Annual 57 States.
1 40
3 40
1 40
reported RSA data for FY 2015, we
estimate that each VR agency will incur
an additional 3, 600 hours in labor
burden to collect sec. 116 performance
data for current and new participants in
the first year of data collection, or 58
additional hours per VR counselor.
However, for the second and subsequent
years of data collection under these final
regulations, we estimate that each VR
agency will incur an additional 945
hours per year in labor burden to collect
joint performance data, or 15 hours per
year per counselor. The data collection
burden associated with the
implementation of amendments to the
VR program under title IV of WIOA is
included in the RIA section of the final
regulations for the " State Vocational
Rehabilitation Services Program; State
Supported Employment Services
Program; Limitations on Use of
Subminimum Wage" also published in
this edition of the Federal Register.
EXHIBIT 40— UPDATES TO THE FINAL RULE ANALYSIS COSTS OF STATE -LEVEL VR PROGRAMS— PERFORMANCE REPORTS
AverageLabor number of
category workers
NPRM
i Performance reports
Average
level Frequency
hrs.)
N/ A
of effort
Number of
affected
entities
Final rule
c Performance accountability system
AverageAverage Number of level Labor category Frequencynumber of affected of effort workers entities hrs.)
Performance Reports—Review and Verify Annual Performance Reports
Management occupa-
tions staff.
5 Annual 80 VR
agen-
cies.
Computer systems ana-
lyst.
5
Social & community 2 10
service manager.
55954 Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
EXHIBIT 40— UPDATES TO THE FINAL RULE ANALYSIS COSTS OF STATE -LEVEL VR PROGRAMS— PERFORMANCE
REPORTS— Continued
NPRM
CO Performance reports
AverageAverage Number of Labor level number of affectedFrequencyof effort workers entitiescategory
hrs.)
Final rule
c Performance accountability system
AverageAverage level Labor category Frequencynumber of of effort workers hrs.)
Database administrator 1 25
Performance Reports— Training on New Data Collection
Staff trainer 1 6 One time
Rehabilitation counselor 62 3
Performance Reports – Data Collection
Rehabilitation counselor 62 58 First year
Rehabilitation counselor 62 15 Second and
subsequent
years.
Number of
affected
entities
80 VR
agen-
cies.
80 VR
agen-
cies.
80 VR
agen-
cies.
At the local level for the AEFLA burden under WIOA. Instead of manager and increased the number of
program, the Departments made the presenting the costs at the State level as entities to reflect local programs for this
following updates, which are presented in the NPRM, we are presenting annual provision. In addition, we added one
in Exhibit 41. We considered the extent costs at the program, or local, level. As database administrator for data
of actual local involvement in a result, we reduced the number of collection, analysis, and entry.
performance reporting and additional managers and the hours per local
EXHIBIT 41— UPDATES TO COSTS OF LOCAL -LEVEL AEFLA PROGRAMS— PERFORMANCE REPORTS
NPRM Final rule
i Performance reports c Performance accountability system
Average AverageAverage Number of Average Number of Labor level level number of affected number of affected of effort of effortFrequency Labor category Frequencycategory workers hrs.)
ManagerManager 40 40 One time
Evaluation of State Programs
This section describes the updates to
the NPRM' s provision (j) " Evaluation of
State Programs." In the Final Rule' s
subject -by -subject analysis, costs related
to this provision can be found primarily
in provision (d) " State Evaluation
Responsibilities." 38 The cost of this
provision of the Final Rule reflects the
cost for affected entities to conduct
38 A small portion of State -level software and IT
systems costs for the AEFLA program was moved
to provision (c) " Performance Accountability
System."
39 A portion of the $ 222 5 million in costs
accounts for software and IT systems costs from
entities workers entities
5757 StatesStates
Management occupa-
tions staff.
Social & community
service manager.
Database administrator
evaluations of title I activities over
multiple years to provide various forms
of data for Federal evaluations, and for
SWAs and other State agencies to
coordinate in designing and developing
evaluations carried out under sec. 116( e)
of WIOA. For this provision, the total
10 -year cost (undiscounted) decreased
from $ 737. 9 million in the NPRM to
222. 5 million in this Final Rule.3949
provision ( e) " Development of Strategies for
Aligning Technology and One -Stop Partner
Programs" and provision (i) "Performance Reports."
Thus, this value understates how much costs have
decreased in this Final Rule relative to the NPRM.
hrs.)
PerformancePerformance ReportsReports
1 8 Annual 2, 396 local
pro-
grams.
1 8
1 8
At the Federal level for the DOL
programs, the Departments made the
following updates, which are presented
in Exhibit 42. We added two managers,
one computer system analyst, and two
management analysts to account for
Federal effort related to SWA evaluation
activities under sec. 116( e) of WIOA. We
added these Federal staff costs to
support all aspects of State evaluation
40 This variance in cost is due to the reduction in
software and IT systems costs for State -level DOL
programs and the removal of costs for local -level
AEFLA programs.
55955Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
activities, including technical assistance, monitoring, and
dissemination.
EXHIBIT 42— UPDATES TO COSTS OF FEDERAL -LEVEL DOL PROGRAMS— EVALUATION OF STATE PROGRAMS
NPRM Final rule
j) Evaluation of state programs d) State evaluation responsibilities
Labor
category
Average
number of
workers
Average
level
of effort
hrs.)
Frequency
Number of
affected
entities
Labor category
Average
number of
workers
Average
level
of effort
hrs.)
Frequency
Number of
affected
entities
N/ A Management occupa-2 25 Annual 1.
tions staff ( GS -14,
Step 5).
Computer systems ana-1 3
lysts ( GS -13, Step 5).
Management analyst 2 30
GS -12, Step 5).
Exhibit 43 presents the changes made participation in the coordination support all aspects of State evaluation
by the Departments to reflect the cost of process, and possibly in the design and activities, including technical
Federal AEFLA program staff in development of State evaluation assistance, monitoring, and
providing technical assistance and dissemination.activities under WIOA sec. 116( e).
promoting State adult education agency These Federal staff costs were added to
EXHIBIT 43— UPDATES TO COSTS OF FEDERAL -LEVEL AEFLA PROGRAMS— EVALUATION OF STATE PROGRAMS
NPRM Final rule
j) Evaluation of state programs d) State evaluation responsibilities
Average AverageAverage Number of Average Number of Labor level level number of affected number of affectedFrequency Labor category Frequencyof effort of effort workers entities workers entities hrs.) hrs.)
category
N/ A Management occupa-4 10 Annual 1.
tions staff ( GS -14,
Step 5).
Computer systems ana-1 5
lysts ( GS -13, Step 5).
Management analyst 2 30
GS -12, Step 5).
Exhibit 44 presents the changes made added these Federal staff costs toagency participation and coordination
by the Departments to reflect the cost of in carrying out State evaluations under support all aspects of State evaluation
Federal staff responsible for the VR sec. 116( e) of WIOA, including possible activities such as technical assistance,
program in providing technical involvement in the design and monitoring, and dissemination.
assistance and promoting State VR development of such evaluations. We
EXHIBIT 44— UPDATES TO COSTS OF FEDERAL -LEVEL VR PROGRAMS— EVALUATION OF STATE PROGRAMS
NPRM Final rule
j) Evaluation of state programs d) State evaluation responsibilities
Average AverageAverage Number of Average Number of Labor level level number of affected number of affectedFrequency Labor category Frequencyof effort of effort workers entities workers entitiescategory
hrs.) hrs.)
N/ A Management occupa-2 5 Annual 1.
tions staff ( GS -14,
Step 5).
Social & community 2 10
service manager
GS -13, Step 5).
Management analyst 2 15
GS -12, Step 5).
55956 Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
The Departments made the following
updates to the State -level DOL
programs, which are presented in
Exhibit 45. After consultation with
additional program experts, we made
the following updates: ( 1) We replaced
the manager in our previous estimate
with the more appropriate occupational
category of social and community
service manager; ( 2) we replaced the
two technical staff members in the
previous estimate with the more
appropriate occupational category of
computer systems analyst and reduced
the annual level of effort per staff
member from 20 hours to 15 hours; ( 3)
we added a management analyst with an
annual level of effort of 10 hours; ( 4) we
reduced the annual software and IT
systems costs from $200, 000 and $ 1
million for 20 " low -effort" States and 15
high -effort" States, respectively, to
10, 000 for all 57 SWAs; and (5) we
added an annual consultant cost of
21, 400. In the NPRM, we assumed that
full cooperation would occur.
Realistically, cooperation will be
difficult to achieve because there is an
overall lack of funding for evaluations;
therefore, a reduced cost estimate is
appropriate.
category workers hrs.)
Manager 1 20 Annual
Technical 2 20
staff.
Admin. staff 1 10
Software/ IT 200,000
systems
cost
Low -Ef-
fort"
States).
Software/IT 1, 000,000
systems
cost
High -Ef-
fort"
States).
At the State level for the AEFLA
program, the Departments made the
following changes, which are presented
in Exhibit 46. We reduced the number
of managers from five to two after
determining that the number needed to
reflect an average staffing level for this
activity across all States and outlying
areas. One of these managers is
categorized as a social and community
service manager. We replaced the two
EXHIBIT 45— UPDATES TO COSTS OF STATE -LEVEL DOL PROGRAMS— EVALUATION OF STATE PROGRAMS
NPRM Final rule
j) Evaluation of state programs d) State evaluation responsibilities
Average AverageAverage Number of Average Number of Labor level level number of affected number of affectedFrequency Labor category Frequencyof effort of effort entities workers entities
56 States Computer systems ana-
lyst.
Social & community
service manager.
Management analyst ....
20 States Office & admin. support
staff.
15 States Software/ IT systems
cost.
Consultant cost
technical staff members in the previous
estimate with the more appropriate
occupational categories of computer
systems analysts and management
analysts. We also revised the calculation
to exclude the five administrative staff
members included in the previous
estimate, because those occupational
categories are generally not involved in
the evaluation of State programs. We
reduced the level of effort for the staff
hrs.)
2 15 Annual 57 SWAB.
1 20
1 10
1 10
10 000
21, 400
because we have concluded that this
work does not require the level of effort
we initially estimated. In addition, we
eliminated the annual IT systems costs
from this provision and accounted for
them under subsection " Development
and Updating of State Performance
Accountability Systems" in provision
c) of this Final Rule because they were
more appropriately placed there ( see
Exhibit 17).
EXHIBIT 46— UPDATES TO COSTS OF STATE -LEVEL AEFLA PROGRAMS— EVALUATION OF STATE PROGRAMS
Labor
category
Manager
Technical
staff.
Admin. staff
NPRM
j) Evaluation of state programs
AverageAverage level number of Frequencyof effort workers hrs.)
5 120 Annual
2 80
5 80
Final rule
c) Performance accountability system
Number of
affected Labor category
Average
number of
Average
level
of effort Frequency
entities workers hrs.)
Number of
affected
entities
57 States Development and Updating of State Performance Accountability Systems
Software/ IT systems 350,000 Annual 57 States.
cost.
d) State Evaluation Responsibilities
55957Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
EXHIBIT 46— UPDATES TO COSTS OF STATE -LEVEL AEFLA PROGRAMS— EVALUATION OF STATE PROGRAMS— Continued
NPRM Final rule
j) Evaluation of state programs c Performance accountability system
Average AverageAverage Number of Average Number of Labor level level number of affected number of affectedFrequency Labor category Frequencyof effort of effort workers entities workers entitiescategory
hrs.) hrs.)
Software/IT 250,000 Management occupa-1 10 Annual 57 SWAB.
systems tions staff.
cost.
Computer systems ana-1 20
lyst.
Social & community 1 10
service manager.
Management analyst .... 1 20
For the State VR program, the the more appropriate occupational added one social community service
Departments replaced the technical staff category of computer systems analysts, manager and one management analyst.
member in the previous estimate with as shown in Exhibit 47. In addition, we
EXHIBIT 47— UPDATES TO COSTS OF STATE -LEVEL VR PROGRAMS— EVALUATION OF STATE PROGRAMS
NPRM Final rule
j) Evaluation of state programs d) State evaluation responsibilities
Labor
category
Average
number of
workers
Average
level
of effort
hrs.)
Frequency
Number of
affected
entities
Labor category
Average
number of
workers
Average
level
of effort
hrs.)
Frequency
Number of
affected
entities
Manager 1 11 AnnualAnnual 80 VR agen-Management occupa-1 1 Annual 8080 VRVR
cies. tions staff. agen-agen-
cies.cies.
Technical 1 13 Computer systems ana-1 13
staff. lyst.
Admin. staff 1 2 Social & community 1 5
service managers.
Management analyst .... 1 5
Office and admin. sup-1 2
port staff.
The Departments made the following 48. We reconsidered the extent of local that hours for local staff should be
changes for the local -level AEFLA involvement in the evaluation of State eliminated for this provision.
program, which are presented in Exhibit programs. As a result, we concluded
EXHIBIT 48— UPDATES TO COSTS OF LOCAL -LEVEL AEFLA PROGRAMS— EVALUATION OF STATE PROGRAMS
NPRM Final rule
j) Evaluation of state programs d) State evaluation responsibilities
Average AverageAverage Number of Average Number of Labor level level number of affected number of affectedFrequency Labor category Frequencyof effort of effortcategory workers entities workers entities hrs.) hrs.)
Manager 40 120 Annual 57 States N/ A
Technical 40 80
staff.
Admin. staff 40 80
for States to implement effectiveness in on whether these measures would be
serving employer approaches because, added to the rule. In the Final Rule, the
Effectiveness in Serving Employers
This section describes the updates to at the time of the NPRM' s publication, Departments estimated the cost of the
the rule' s cost analysis. In the NPRM, pilot program and the implementationpolicy decisions had not yet been madethe Departments did not include costs
55958 Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
of the effectiveness in serving employers
measures, which amounted to a total
undiscounted 10 -year cost of $6. 4
million. See the cost subsection of
section V.A.6 (Subject -by -Subject
Analysis) below for details on this
estimate.
6. Subject -by -Subject Cost -Benefit
Analysis
The Departments' analysis below
covers the expected costs of
implementing the requirements of the
Final Rule against the baseline cost
under WIA, especially with regard to
the following four expected costs: ( a)
Time to Review the New Rule;" ( b)
Unified or Combined State Plans:
Expanded Content, Biennial
Development and Modification Process,
and Submission Coordination
Requirements;" ( c) " Performance
Accountability System;" and (d) " State
Evaluation Responsibilities."
The Departments emphasize that
many of the requirements in this Final
Rule are not new, for DOL programs, but
rather were requirements under WIA.
For example, States were required to
prepare performance reports" under
title I of WIA and other authorizing
statutes amended by WIA required
States to submit performance
information. Similarly, many of the
requirements governing the one-stop
system' s infrastructure and operations
under WIA are carried forward under
WIOA. Therefore, these and other such
costs are not considered " new" cost
burdens under this Final Rule for some
of the core programs, but rather are
included in the " baseline costs" used as
a comparison for the new burden costs.
Accordingly, this regulatory analysis
focuses on new costs that can be
attributed exclusively to new
requirements under title I of WIOA as
addressed in this Final Rule.
a. Time To Review the New Rule
Upon publication of this Final Rule,
the regulated community will need to
learn about the new regulations and
plan for compliance.
Affected entities will incur costs
based primarily on the level of effort
needed by relevant individuals to
review and understand the Final Rule.
This includes interpretation and
learning how to navigate the Final Rule,
but it does not include any steps beyond
what is included in the baseline related
to running a Federal program. Costs for
developing a detailed action plan for
compliance would not be included in
the new cost burden because they will
be accounted for in other burden
estimate discussions. In addition,
affected entities will incur relatively
minor costs for the first steps needed to
comply, such as notifying relevant
personnel of the rule. The Departments
estimate that learning about the new
regulations and planning for compliance
with those regulations will involve one-
time labor costs for State -level DOL
programs, State-and local -level AEFLA
programs, and State VR agencies in the
first analysis year. Local WDBs might
incur limited costs under this provision,
which are not accounted for below,
because the costs for relevant
individuals to comply are accounted for
in the DOL, AEFLA, and VR agency
estimates. DOL expects that the States
will carefully review and interpret the
Final Rule before passing along any
necessary information to Local WDBs.
Although Local WDBs are not required
to review the Final Rule, those that do
are likely to limit their review to a few
paragraphs or sections most relevant to
them.
i. Costs
At the State level for DOL' s core
programs (see Exhibit 5), the
Departments estimated this labor cost by
multiplying the estimated number of
lawyers per State ( 4) by the time
required to read and review the new
rule (20 hours each), and then by the
applicable hourly compensation rate
65. 48/ hour). We performed the same
calculation for the following
occupational categories: Managers ( 1
manager at $ 65. 39/ hour for 20 hours)
and social and community service
managers ( 2 managers at $ 54. 21/ hour for
40 hours each). We summed the labor
cost for all three categories ($ 10, 883)
and multiplied the result by the number
of States ( 57) to estimate this one-time
cost of $620, 331. Over the 10 -year
period, this calculation yields an
average annual cost of $62, 033.
At the State level for the AEFLA
program (see Exhibit 6), the
Departments estimated this labor cost by
multiplying the estimated number of
lawyers per State ( 1) by the time
required to read and review the new
rule (20 hours) and then by the
applicable hourly compensation rate
65. 48/ hour). We performed the same
calculation for the following
occupational categories: Managers ( 1
manager at $ 65. 39/ hour for 40 hours)
and social and community service
managers ( 3 managers at $ 54. 21/ hour for
20 hours each). We summed the labor
cost for all three categories ($ 7, 178) and
multiplied the result by the number of
States ( 57). This calculation resulted in
a one-time cost of $409, 135, which is
equal to an average annual cost of
40,913.
At the local level for the AEFLA
program (see Exhibit 8), the
Departments multiplied the estimated
number of managers ( 1) by the time
required to read and review the new
rule (4 hours) and then by the hourly
compensation rate ($ 63. 63/ hour). We
repeated the calculation for social and
community service managers ( 1
manager at $ 61. 01/ hour for 4 hours). We
did not estimate lawyer hours for local -
level AEFLA programs because our
experience indicates that this
occupational category is typically
engaged only at the State level. We
summed the labor cost for both
occupational categories ($ 499) and
multiplied the result by the number of
local AEFLA providers ( 2, 396). This
calculation yields $1. 2 million
1, 194, 550) in labor costs in the first
year of the rule. Over the 10 -year period,
this calculation yields an average
annual cost of $119,455.
For State VR agencies ( see Exhibit 7),
the Departments multiplied the
estimated number of managers per VR
agency ( 1) by the time required to read
and review the new rule (40 hours) and
then by the hourly compensation rate
65. 39/ hour). We performed the same
calculation for the following
occupational categories: Social and
community service managers ( 3
managers at $ 54. 21/ hour for 40 hours
each) and rehabilitation counselors ( 3
counselors at $ 36. 66/ hour for 40 hours
each). We summed the labor cost for all
three categories ($ 13, 520) and
multiplied the result by the number of
VR agencies ( 80). This calculation
resulted in a one-time labor cost of $1. 1
million ($1, 081, 600), which is equal to
an average annual cost of $108, 160 over
the 10 -year period.
The sum of these costs yields a total
one-time labor cost of $3. 3 million
3, 305, 615) for individuals from State -
level DOL programs, State-and local -
level AEFLA programs, and State VR
agencies to read and review the new
rule. Over the 10 -year period of
analysis, these one-time costs result in
an average annual cost of $330, 562.
b. Unified or Combined State Plans:
Expanded Content, Biennial
Development and Modification Process,
and Submission Coordination
Requirements
Under WIOA title I, each State must
develop and submit a 4 -year Unified
State Plan that covers the following six
core programs: The adult, dislocated
worker, and youth formula programs
WIOA title I); the AEFLA program
WIOA title II); the Employment Service
program authorized under the Wagner-
Peyser Act, as amended by WIOA title
55959Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
III; and the VR program as authorized by
title I of the Rehabilitation Act of 1973,
as amended by WIOA title IV. In the
alternative, a State may submit a 4 -year
Combined State Plan that covers the six
core programs plus one or more
Combined State Plan partner programs
identified in sec. 103( a)( 2) of WIOA.
Section 103( b)( 1) of WIOA requires the
portion of a Combined State Plan
covering the core programs to meet the
same requirements as for a Unified State
Plan under sec. 102 of WIOA. States
must have an approved Unified or
Combined State Plan in place to receive
funding for the six core programs.
Under WIA, States were required to
submit separate State Plans that
covered: ( 1) The title I and Wagner-
Peyser Act Employment Service DOL
programs; ( 2) the AEFLA program; and
3) the VR program. Because States,
under WIOA, must integrate what had
historically been stand-alone State Plans
for the AEFLA and VR programs into a
single Unified or Combined State Plan
with the title I and Wagner-Peyser Act
Employment Service DOL programs, the
Departments anticipate added cost
burdens for the States as they work
together to strategize alignment of all six
core programs into one Unified or
Combined State Plan. Thus, the
requirement that the Unified or
Combined State Plan must include the
ED -administered programs is new under
WIOA.
Affected entities will incur costs to ( 1)
review and develop new 4 -year Unified
or Combined State Plans to ensure that
they satisfy the new content
requirements; ( 2) perform the
development and modification process
for the plans; and ( 3) coordinate on
developing a Unified or Combined State
Plan that covers all six core programs.
i. Expanded Content
WIOA sec. 102(b) expands the content
requirements for Unified and Combined
State Plans, many of which are new to
all core programs, such as strategic and
operational planning elements. Strategic
planning elements include State
analyses of economic and workforce
conditions, an assessment of workforce
development activities (including
education and training) in the State, and
formulation of the State' s vision and
goals for preparing an educated and
skilled workforce that meets the needs
of employers and a strategy to achieve
the vision and goals. Operational
planning elements include State strategy
implementation, State operating systems
and policies, program -specific
requirements, assurances, and
additional requirements imposed by the
Secretaries of Labor and Education, or
other Secretaries ( for Combined State
Plan purposes), as appropriate. Most of
the WIOA operational planning
elements are functionally equivalent to
State Plan content requirements that
were required by DOL' s core programs
under WIA sec. 112( b). The WIOA
strategic planning elements, however,
constitute new or expanded State
planning requirements for all core
programs that were not required under
WIA. For example, WIOA requires that
more economic, education, and
workforce data be included in the State
Plan than was required under WIA.41
Therefore, this will be an expansion
of a State planning requirement for
DOL' s core programs under WIOA and
will be new requirements for the AEFLA
41 WIOA sec. 102( b)( 1) requires:
1) Strategic Planning Elements.— The Unified
State Plan shall include strategic planning elements
consisting of a strategic vision and goals for
preparing an educated and skilled workforce, that
include—
A) an analysis of the economic conditions in the
State, including—
i) existing and emerging in -demand industry
sectors and occupations; and
ii) the employment needs of employers,
including a description of the knowledge, skills,
and abilities, needed in those industries and
occupations;
B) an analysis of the current workforce,
employment and unemployment data, labor market
trends, and the educational and skill levels of the
workforce, including individuals with barriers to
employment (including individuals with
disabilities), in the State;
C) an analysis of the workforce development
activities (including education and training) in the
State, including an analysis of the strengths and
weaknesses of such activities, and the capacity of
State entities to provide such activities, in order to
address the identified education and skill needs of
the workforce and the employment needs of
employers in the State;
D) a description of the State' s strategic vision
and goals for preparing an educated and skilled
work -force ( including preparing youth and
individuals with barriers to employment) and for
meeting the skilled work -force needs of employers,
including goals relating to performance
accountability measures based on primary
indicators of performance described in section
116(b)( 2)( A), in order to support economic growth
and economic self-sufficiency, and of how the State
will assess the overall effectiveness of the workforce
investment system in the State; and
E) taking into account analyses described in
subparagraphs (A) through (C), a strategy for
aligning the core programs, as well as other
resources available to the State, to achieve the
strategic vision and goals described in subparagraph
D).
WIA sec. 112( b)( 4) required:
b) Contents.— The State plan shall include—
4) information describing—
A) the needs of the State with regard to current
and projected employment opportunities, by
occupation;
B) the job skills necessary to obtain such
employment opportunities;
C) the skills and economic development needs
of the State; and
D) the type and availability of workforce
investment activities in the State;
and VR programs. Because DOL core
programs were already analyzing and
using economic, education, and
workforce data under WIA, those
programs will not experience as much
in incremental costs associated with
that particular requirement as will the
AEFLA and VR programs. The
Departments anticipate that any costs
incurred by the States with regard to
new or expanded State planning content
requirements will constitute one-time
incremental costs for all core programs
to ensure that all Unified or Combined
State Plans satisfy the new content
requirements.
Costs
At the State level for the DOL core
programs ( see Exhibit 26), the
Departments estimated this labor cost by
multiplying the estimated number of
lawyers per State ( 1) by the time
required to review and develop new
Unified or Combined State Plans to
ensure that the new elements are
included (8 hours) and by the hourly
compensation rate ($ 65. 48/ hour). We
performed the same calculation for the
following occupational categories:
Managers ( 4 managers at $ 65. 39/ hour
for 20 hours each), social and
community service managers ( 2
managers at $ 54. 21/ hour for 20 hours
each), and office and administrative
support staff members ( 1 staff member
at $ 30. 57/ hour for 8 hours). We summed
the labor cost for all four categories
8, 168) and multiplied the result by the
number of States ( 57) to estimate this
one-time cost of $465, 576. Over the 10 -
year period, this calculation yields an
average annual cost of $46, 558.
At the State level for the AEFLA
program (see Exhibit 27), the
Departments estimated this cost by
multiplying the estimated number of
lawyers per State ( 1) by the time
required to review and develop new
Unified or Combined State Plans to
ensure that the new elements are
included (20 hours) and by the hourly
compensation rate ($ 65. 48/ hour). We
performed the same calculation for the
following occupational categories:
Managers ( 1 manager at $ 65. 39/ hour for
20 hours) and social and community
service managers ( 3 managers at $ 54. 21/
hour for 20 hours each). We summed
the labor cost for the three occupational
categories ($ 5, 870) and multiplied the
result by the number of States ( 57). This
calculation yields $334, 590 in one-time
labor costs, which is equal to an average
annual cost of $33, 459 over the 10 -year
period.
For State VR agencies ( see Exhibit 28),
the Departments estimated this cost by
first multiplying the estimated number
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of managers per VR agency ( 2) by the
time required to review and develop
new Unified or Combined State Plans to
ensure that the new elements are
included (21 hours each) and by the
hourly compensation rate ($ 65. 39/ hour).
We performed the same calculation for
social and community service managers
2 managers at $ 54. 21/ hour for 21 hours
each). Summing the labor cost for both
categories ($ 5, 023) and multiplying the
result by the number of VR agencies ( 80)
will result in a one-time cost of
401, 856. Over the 10 -year period, this
calculation yields an average annual
cost of $40, 186.
The sum of these costs yields a total
one-time cost of $1. 2 million
1, 202, 022) for individuals from the
State -level DOL core programs, AEFLA
program, and VR agencies to review and
develop new Unified or Combined State
Plans to ensure that the new elements
are included. Over the 10 -year period of
analysis, these one-time costs result in
an average annual cost of $120, 202.
ii. New 4 -Year State Plan Development
and Modification
Under WIA sec. 112( d), modifications
to a State Plan covering the DOL core
programs were permitted but not
required. For the AEFLA program under
WIA sec. 224, States submitted 5 -year
State Plans, and revisions to plans were
required only if those revisions were
substantial. Upon the expiration of
authorization of the program, and
pending reauthorization, States
submitted annual State Plan extensions
containing revisions that were updated
sections of their original 5 -year plans.
For the VR program under title IV of
WIA (sec. 101 of the Rehabilitation Act),
States were required to update specified
State Plan attachments annually and
modifications to State Plan assurances
and other attachments were required
only if substantive changes occurred.
Under WIOA sec. 102( c)( 3)( A), States
must submit modifications to the
Unified or Combined State Plan, at a
minimum, at the end of the first 2 -year
period of any 4 -year Plan. The
modifications must reflect changes in
labor market and economic conditions
or other factors affecting
implementation of the 4 -year Unified or
Combined State Plan. This mandatory
biennial review and modification of a 4 -
year Unified or Combined State Plan is
a new cost under WIOA for all six core
programs.
State -level DOL programs, AEFLA
programs, and VR agencies will incur
biennial labor costs to review and
modify the Unified or Combined State
Plan at the end of the 2 -year period after
any 4 -year plan. In the absence of
significant economic or administration
changes within a State, most costs
resulting from the State Plan
modification requirements will occur
during the first and second submissions
because the unified State planning
process is new for all core programs and
States will just be learning the new
requirements of WIOA and how to
coordinate among all core programs so
that they become more aligned to
promote an integrated workforce
development system. The Departments
anticipate that new Unified or
Combined State Plans submitted in 2020
and thereafter, and the 2 -year
modifications of those Plans, will be
easier for States to develop. For this
reason, we present the costs by year of
submission of either the development of
a 4 -year Unified or Combined State Plan
or the 2 -year modification of that Plan.
Costs
Four -Year Plan Modification—Third
Year
At the State level for the DOL core
programs (see Exhibit 9), the
Departments estimated this labor cost by
multiplying the estimated number of
lawyers per State ( 1) by the time
required to review and modify the 4 -
year Unified or Combined State Plan (4
hours) and by the hourly compensation
rate ($ 65. 48/ hour). We performed the
same calculation for the following
occupational categories: Managers ( 1
manager at $ 65. 39/ hour for 12 hours),
management analysts (2 analysts at
45. 88/ hour for 12 hours each), and
office and administrative support staff
members ( 1 staff member at $ 30. 57/ hour
for 4 hours). We summed the labor cost
for all four categories ($ 2, 270) and
multiplied the result by the number of
States ( 57) to estimate this one-time cost
of $129, 390, occurring in 2018. Over the
10 -year period, this calculation yields
an average annual cost of $12, 939.
At the State level for the AEFLA
program (see Exhibit 10), the
Departments estimated this cost by
multiplying the estimated number of
lawyers per State ( 1) by the time
required to review and modify the 4 -
year Unified or Combined State Plan (10
hours) and by the hourly compensation
rate ($ 65. 48/ hour). We performed the
same calculation for the following
occupational categories: Managers ( 1
manager at $ 65. 39/ hour for 10 hours)
and social and community service
managers ( 3 managers $ 54. 21/ hour for
10 hours each). We summed the labor
cost for the three occupational
categories ($ 2, 935) and multiplied the
result by the number of States ( 57). This
results in a one-time cost of $167,295,
occurring in 2018. Over the 10 -year
period of the analysis, this one-time cost
results in an average annual cost of
16, 730.
For State VR agencies ( see Exhibit 11),
the Departments estimated this cost by
first multiplying the estimated number
of managers per VR agency ( 2) by the
time required to review and modify the
4 -year Unified or Combined State Plan
14 hours each) and by the hourly
compensation rate ($ 65. 39/ hour). We
performed the same calculation for
social and community service managers
2 managers at $ 54. 21/ hour for 14 hours
each). Summing the labor cost for both
categories ($ 3, 349) and multiplying the
result by the number of VR agencies
80), we estimate this one-time cost at
267, 904, occurring in 2018. This
calculation yields an average annual
cost of $26, 790 over the 10 -year period.
The sum of these costs yields a total
one-time cost of $564, 589, occurring in
2018, for individuals from the State -
level DOL core programs, AEFLA
program, and VR agencies to review and
modify the 4 -year Unified or Combined
State Plan. Over the 10 -year period of
analysis, these one-time costs result in
an average annual cost of $56,459.
Development of 4 -Year State Plan—Fifth
Year
At the State level for the DOL core
programs ( see Exhibit 9), the
Departments estimated this labor cost by
multiplying the estimated number of
lawyers per State ( 1) by the time
required to review and develop a new
4 -year Unified or Combined State Plan
4 hours) and by the hourly
compensation rate ($ 65. 48/ hour). We
performed the same calculation for the
following occupational categories:
Managers ( 1 manager at $ 65. 39/ hour for
12 hours), management analysts ( 2
analysts at $ 45. 88/ hour for 12 hours
each), and office and administrative
support staff members ( 1 staff member
at $ 30. 57/ hour for 4 hours). We summed
the labor cost for all four categories
2, 270) and multiplied the result by the
number of States ( 57) to estimate this
one-time cost of $129, 390, occurring in
2020. This one-time cost results in an
average annual cost of $12, 939 over the
10 -year period.
At the State level for the AEFLA
program (see Exhibit 10), the
Departments estimated this cost by
multiplying the estimated number of
lawyers per State ( 1) by the time
required to review and develop a new
4 -year Unified or Combined State Plan
15 hours) and by the hourly
compensation rate ($ 65. 48/ hour). We
performed the same calculation for the
following occupational categories:
55961Federal Register / Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
Managers ( 1 manager at $ 65. 39/ hour for
15 hours) and social and community
service managers ( 3 managers at $ 54. 21/
hour for 15 hours each). We summed
the labor cost for the three occupational
categories ($4,403) and multiplied the
result by the number of States ( 57). This
will result in a one-time cost of
250, 943, occurring in 2020. Over the
10 -year period, this calculation yields
an average annual cost of $25, 094.
For State VR agencies ( see Exhibit 11),
the Departments estimated this cost by
first multiplying the estimated number
of managers per VR agency ( 2) by the
time required to review and develop a
new 4 -year Unified or Combined State
Plan ( 10 hours each) and by the hourly
compensation rate ($ 65. 39/ hour). We
performed the same calculation for
social and community service managers
2 managers at $ 54. 21/ hour for 10 hours
each). We summed the labor cost for
both categories ($ 2, 392) and multiplied
the result by the number of VR agencies
80). This calculation yields $191, 360 in
one-time labor costs, occurring in 2020.
This one-time cost results in an average
annual cost of $19, 136 over the 10 -year
period.
The sum of these costs yields a total
one-time cost of $571, 693, occurring in
2020, for individuals from the State -
level DOL core programs, AEFLA
program, and VR agencies to review and
develop a new 4 -year Unified or
Combined State Plan. Over the 10 -year
period of analysis, the sum of these one-
time costs results in an average annual
cost of $57, 169.
Four -Year State Plan Modification—
Seventh Year
At the State level for the DOL core
programs ( see Exhibit 9), the
Departments estimated this labor cost by
multiplying the estimated number of
lawyers per State ( 1) by the time
required to review and modify the 4 -
year Unified or Combined State Plan (4
hours) and by the hourly compensation
rate ($ 65. 48/ hour). We performed the
same calculation for the following
occupational categories: Managers ( 1
manager at $ 65. 39/ hour for 8 hours),
management analysts ( 2 analysts at
45. 88/ hour for 8 hours each), and
office and administrative support staff
members ( 1 staff member at $ 30. 57/ hour
for 4 hours). We summed the labor cost
for all four categories ($ 1, 641) and
multiplied the result by the number of
States ( 57) to estimate this cost of
93, 560, occurring in 2022. This is
equal to an average annual cost of
9, 356.
At the State level for the AEFLA
program (see Exhibit 10), the
Departments estimated this cost by
multiplying the estimated number of
lawyers per State ( 1) by the time
required to review and modify the 4 -
year Unified or Combined State Plan (5
hours) and by the hourly compensation
rate ($ 65. 48/ hour). We performed the
same calculation for the following
occupational categories: Managers ( 1
manager at $ 65. 39/ hour for 5 hours) and
social and community service managers
3 managers at $ 54. 21/ hour for 5 hours
each). We summed the labor cost for the
three occupational categories ($ 1, 468)
and multiplied the result by the number
of States ( 57). This results in a one-time
cost of $83, 648, occurring in 2022. This
is equal to an average annual cost of
8, 365.
For State VR agencies ( see Exhibit 11),
the Departments estimated this cost by
first multiplying the estimated number
of managers per VR agency ( 2) by the
time required to review and modify the
4 -year Unified or Combined State Plan
7 hours) and by the hourly
compensation rate ($ 65. 39/ hour). We
performed the same calculation for
social and community service managers
2 managers at $ 54. 21/ hour for 7 hours
each). Summing the labor cost for both
categories ($ 1, 674) and multiplying the
result by the number of VR agencies
80), we estimate this one-time cost of
133, 952, occurring in 2022. This is
equal to an average annual cost of
13, 395.
The sum of these costs for the
modification process occurring for new
4 -year Unified or Combined State Plans
yields a total cost of $311, 159, occurring
in 2022, for individuals from the State -
level DOL core programs, AEFLA
program, and VR agencies. Over the 10 -
year period of analysis, this results in an
average annual cost of $31, 116.
Development of 4 -Year State Plan—
Ninth Year
At the State level for the DOL core
programs ( see Exhibit 9), the
Departments estimated this labor cost by
multiplying the estimated number of
lawyers per State ( 1) by the time
required to review and develop a new
4 -year Unified or Combined State Plan
4 hours) and by the hourly
compensation rate ($ 65. 48/ hour). We
performed the same calculation for the
following occupational categories:
Managers ( 1 manager at $ 65. 39/ hour for
10 hours), management analysts ( 2
analysts at $45.88/hour for 10 hours
each), and office and administrative
support staff members ( 1 staff member
at $ 30. 57/ hour for 4 hours). We summed
the labor cost for all four categories
1, 956) and multiplied the result by the
number of States ( 57) to estimate this
one-time cost of $111, 475, occurring in
2024. This one-time cost results in an
average annual cost of $11, 147 over the
10 -year period.
At the State level for the AEFLA
program (see Exhibit 10), the
Departments estimated this cost by
multiplying the estimated number of
lawyers per State ( 1) by the time
required to review and develop a new
4 -year Unified or Combined State Plan
10 hours) and by the hourly
compensation rate ($ 65. 48/ hour). We
performed the same calculation for the
following occupational categories:
Managers ( 1 manager at $ 65. 39/ hour for
10 hours) and social and community
service managers ( 3 managers at $ 54. 21/
hour for 10 hours each). We summed
the labor cost for the three occupational
categories ($ 2, 935) and multiplied the
result by the number of States ( 57). This
will result in a one-time cost of
167, 295, occurring in 2024. Over the
10 -year period, this calculation yields
an average annual cost of $16, 730.
For State VR agencies ( see Exhibit 11),
the Departments estimated this cost by
first multiplying the estimated number
of managers per VR agency ( 2) by the
time required to review and develop a
new 4 -year Unified or Combined State
Plan ( 7 hours each) and by the hourly
compensation rate ($ 65. 39/ hour). We
performed the same calculation for
social and community service managers
2 managers at $ 54. 21/ hour for 7 hours
each). We summed the labor cost for
both categories ($ 1, 674) and multiplied
the result by the number of VR agencies
80). This calculation yields $133,952 in
one-time labor costs, occurring in 2024.
This one-time cost results in an average
annual cost of $13, 395 over the 10 -year
period.
The sum of these costs yields a total
one-time cost of $412, 722, occurring in
2024, for individuals from the State -
level DOL core programs, AEFLA
program, and VR agencies to review and
develop a new 4 -year Unified or
Combined State Plan. Over the 10 -year
period of analysis, the sum of these one-
time costs results in an average annual
cost of $41, 272.
In total, the cost for the biennial
development and modification process
over the 10 -year period is $ 1. 9 million
1, 860, 163). This estimated total 10 -
year cost results in an average annual
cost of $186, 016.
iii. Coordinating Submissions
Affected entities will incur costs
associated with coordinating actions
among the core programs administered
by DOL and ED because, as explained
above, under WIA, only the DOL core
programs were covered by a single State
Plan; the AEFLA and VR programs each
55962 Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
had stand-alone State Plans under WIA.
For State WDBs, the Departments
estimate that costs will be associated
with State planning attributed to the
extra effort to coordinate and develop a
plan that covers all six core programs,
which is a new requirement under
WIOA.
The Departments estimate that the
AEFLA and VR programs will incur
one-time costs associated with
coordinating and participating in
statewide stakeholder meetings and
other activities to coordinate, develop,
and review their first-time State Plan
submissions. We anticipate that the
AEFLA and VR programs will incur a
larger cost than the DOL core programs
because, under WIA, neither the AEFLA
nor VR program were required to
coordinate with other partner programs
in developing a State Plan. We also
anticipate that the DOL core programs
will experience an incremental increase
in their coordination costs because this
will be the first time that DOL core
programs must coordinate with the
AEFLA and VR programs for State
planning purposes. Although the DOL
core programs have had to coordinate
with each other under WIA, because
new relationships will need to be
formed with the AEFLA and VR
partners, their costs will increase.
In addition, in some States, different
agencies that previously have not
worked together will have to build
infrastructure to form partnerships.
Working together might take the form of
shaking hands" and following a
model agreement" involving State
councils.
Compliance with this provision will
increase biennial labor costs— in
connection with the development of a 4 -
year Unified or Combined State Plan or
the 2 -year modifications of each of those
plans—for State -level DOL core
programs, State-and local -level AEFLA
programs, and State -level VR agencies.
Costs
At the State level for the DOL core
programs ( see Exhibit 26), the
Departments estimated this labor cost by
multiplying the estimated number of
managers per State ( 1) by the time
required to coordinate on developing a
Unified or Combined State Plan among
all six core programs (8 hours) and by
the hourly compensation rate ($ 65. 39/
hour). We performed the same
calculation for the following
occupational categories: Management
analysts (2 analysts at $45.88/hour for 8
hours each) and office and
administrative support staff members ( 1
staff member at $ 30. 57/ hour for 8
hours). We summed the labor cost for all
three categories ($ 1, 502) and multiplied
the result by the number of States ( 57)
to estimate this biennial cost of $85, 600.
Over the 10 -year period, this calculation
yields a total cost of $428, 002, which is
equal to an average annual cost of
42, 800.
At the State level for the AEFLA
program (see Exhibit 27), the
Departments estimated this labor cost by
multiplying the estimated number of
lawyers per State ( 1) by the time
required to coordinate on developing
the Unified or Combined State Plan
submission (4 hours) and by the hourly
compensation rate ($ 65. 48/ hour). We
performed the same calculation for the
following occupational categories:
Managers ( 1 manager at $ 65. 39/ hour for
8 hours), social and community service
managers ( 3 managers at $ 54. 21/ hour for
8 hours each), and office and
administrative support staff members ( 1
staff member at $ 30. 57/ hour for 8
hours). We summed the labor cost for all
four categories ($ 2, 331) and multiplied
the result by the number of States ( 57).
This calculation yields a biennial cost of
132, 846. Over the 10 -year period, this
calculation results in a total cost of
664, 232, which is equal to an average
annual cost of $66, 423.
At the local level for the AEFLA
program (see Exhibit 29), the
Departments estimated this cost by
multiplying the estimated number of
managers per local AEFLA provider (1)
by the time required to coordinate on
developing the Unified or Combined
State Plan submission (4 hours) and by
the hourly compensation rate ($ 63. 63/
hour). We repeated the calculation for
social and community service managers
1 manager at $ 61. 01/ hour for 4 hours).
We summed the labor cost for the two
occupational categories ($ 499) and
multiplied the result by the number of
local AEFLA providers (2, 396). The
biennial cost at the local level for the
AEFLA program is estimated to be $ 1. 2
million ($1, 194, 550). Over the 10 -year
period, this calculation results in a total
cost of $6. 0 million ($5, 972, 749), which
is equal to an average annual cost of
597, 275.
For State VR agencies ( see Exhibit 28),
the Departments estimated this cost by
first multiplying the estimated number
of managers per VR agency ( 2) by the
time required to coordinate and develop
the Unified or Combined State Plan
submission ( 14 hours each) and by the
hourly compensation rate ($ 65. 39/ hour).
We performed the same calculation for
social and community service managers
2 managers at $ 54. 21/ hour for 14 hours
each). Summing the labor cost for both
categories ($ 3, 349) and multiplying the
result by the number of VR agencies ( 80)
results in a biennial cost of $267, 904 for
State VR agencies. Over the 10 -year
period, this calculation yields a total
cost of $1. 3 million ($1, 339, 520), which
is equal to an average annual cost of
133, 952.
The sum of these costs yields a
biennial cost of $1. 7 million
1, 680, 901). Over the 10 -year period,
this calculation results in a total cost of
8. 4 million ($8, 404, 503), which is
equal to an average annual cost of
840, 450, for individuals from State -
level DOL core programs, State-and
local -level AEFLA programs, and State -
level VR agencies to coordinate actions
among all six core programs.
The sum of the costs for the Unified
or Combined State Plans: Expanded
Content, Biennial Development and
Modification Process, and Submission
Coordination requirements, which
includes the costs to expand content
requirements, develop and modify State
Plans, and coordinate the submission of
State Plans results in a 10 -year total cost
of $11. 5 million ($11, 466, 688), which
results in an average annual cost of $1. 1
million ($1, 146, 669).
c. Performance Accountability System
WIOA sec. 116 establishes
performance accountability indicators
and performance reporting requirements
to assess the effectiveness of States and
local areas in achieving positive
outcomes for individuals served by the
six core programs (WIOA sec.
116(b)( 3)( A)(ii)).With few exceptions,
including the local accountability
system under WIOA sec. 116( c), the
performance accountability
requirements apply across all six core
programs.
Affected entities will incur costs to ( 1)
develop and update their State
performance accountability system; ( 2)
implement measures for data collection
and reporting on effectiveness of serving
employers; ( 3) negotiate levels of
performance; (4) run statistical
adjustment model to adjust levels of
performance based on actual economic
conditions and characteristics of
participants; (5) collect data to report on
any additional State performance
accountability indicators; (6) provide
technical assistance to States; ( 7)
develop a performance report template
that reports outcomes via the new
WIOA performance accountability
metrics; develop, update, and submit
ETP reports; and collect, analyze, and
report performance data; ( 8) obtain UI
wage data; and (9) purchase data
analytic software and perform training.
55963Federal Register / Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
i. Development and Updating of State
Performance Accountability Systems
Under WIOA sec. 101( d)( 8), States
must help Governors develop strategies
for aligning technology and data
systems across one-stop partner
programs to enhance service delivery
and improve efficiencies in reporting on
performance accountability measures.
This WIOA provision specifies that such
strategies must include design and
implementation of common intake, data
collection, case management
information, and performance
accountability measurement and
reporting processes. The strategies also
must incorporate local input to such
design and implementation to improve
coordination of services across one-stop
partner programs.
Although this State WDB requirement
is implemented in the DOL WIOA Final
Rule, one-stop partner programs will
have to contribute to the development of
the data system alignment strategies
required by WIOA. Moreover, the
implementation of these data system
alignment strategies developed by the
State WDBs— the actual alignment of
technology and data systems across one-
stop partner programs—would impose
costs on one-stop partners. For these
reasons, the Departments consider the
costs imposed on State WDBs and the
potential future costs to one-stop
partner programs by this WIOA
requirement a cost of this Final Rule.
WIOA sec. 116(b)( 2)( A)(i) establishes
six primary indicators of performance
for measuring the effectiveness of
activities provided for under each of the
core programs:
1) Percentage of program participants
who are in unsubsidized employment
during the second quarter after exit from
the program;
2) Percentage of program participants
who are in unsubsidized employment
during the fourth quarter after exit from
the program;
3) Median earnings of program
participants who are in unsubsidized
employment during the second quarter
after exit from the program;
4) Percentage of program participants
who obtain a recognized postsecondary
credential, or a secondary school
diploma or its recognized equivalent,
during participation in or within 1 year
after exit from the program;
5) Percentage of program participants
who, during a program year, are in an
education or training program that leads
to a recognized postsecondary
credential or employment and who are
achieving measurable skill gains toward
such a credential or employment; and
6) Indicator(s) of effectiveness in
serving employers.42
Under WIOA sec. 116(b)( 2)( A)(i),
however, the fourth and fifth indicators
are not applicable to the Wagner-Peyser
Act Employment Service program
because that program provides no
education or training services, which
are measured by those performance
indicators. Additionally, for youth
activities authorized under WIOA title I,
subtitle B, WIOA specifies slightly
modified versions of the first two
primary indicators of performance. 43
Under WIA sec. 136, the performance
indicators differed and applied only to
activities under the adult, dislocated
worker, and youth formula programs
administered by DOL. Under WIA sec.
212, the AEFLA program was subject to
indicators of performance that applied
specifically to that program. The VR
program was subject to standards and
indicators of performance established
under the Rehabilitation Act. Thus, the
task of measuring program effectiveness
through the calculation and updating of
levels of performance as indicated by
the specific performance indicator
metrics established in WIOA is
somewhat new for all six core programs.
The Departments assume that the
potential implementation of the
strategies for aligning technology and
data systems across one-stop partner
programs would involve consulting and
software and IT systems for State -level
DOL programs and VR agencies. There
would be larger upfront consulting costs
to design the system and software and
IT systems costs to purchase hardware
and implement the system. Subsequent
software and IT systems costs would
also be incurred for maintaining the
systems. Some States are already
working to better align technology and
data systems where feasible and are at
varying points in the alignment process.
States that are farther in the process will
require less effort for alignment than
those using legacy systems. We estimate
that 40 percent of State -level DOL
programs (i.e., SWAs) (23 SWAs) and
VR agencies ( 32 agencies) will be " low -
effort" SWAs and VR agencies, and 60
4z W1OA sec. 116(b)( 2)( A)(iv) requires DOL and
ED to develop one or more indicators of
performance to measure the effectiveness of the
core programs in serving employers.
43 WIOA sec. 116(b)( 2)( A)(ii) establishes the
following youth performance indicators in place of
the first and second indicators applicable to the
other core programs: ( 1) The percentage of program
participants who are in education or training
activities, or in unsubsidized employment, during
the second quarter after exit from the program; and
2) the percentage of program participants who are
in education or training activities, or in
unsubsidized employment, during the fourth
quarter after exit from the program.
percent will be " high -effort" SWAs ( 34
SWAs) and VR agencies (48 agencies).
These estimates are based on the
Departments' experience with WIA
programs and information received from
SWAs, and represent costs for average
SWAs and VR agencies within each
effort classification. We understand that
some SWAs and VR agencies will
experience costs far exceeding those we
account for in " high -effort" entities and
far below those estimated for " low -
effort" entities. In addition, the
Departments anticipate that the State -
level AEFLA programs will incur
annual software and IT systems costs to
enhance their participation in the SLDS
Grant Program, which supports the
design, development, implementation,
and expansion of P -20W (early learning
through the workforce) longitudinal
data systems.
The affected entities will incur costs
to develop and update their
performance accountability systems,
which involves establishing the
capabilities to collect and regularly
update the relevant performance data.
State -level DOL core programs, State -
and local -level AEFLA programs, and
Federal-and State -level VR agencies
will incur labor costs related to
complying with this provision' s
requirements in the first year of the
Final Rule. Furthermore, compliance
will result in a one-time non -labor cost
for software and IT systems for the
Federal DOL program. For State -level
DOL core programs, compliance will
result in one-time non -labor costs for
software and IT systems and consultants
and annual non -labor costs for licensing
fees. In addition, compliance will result
in annual software and IT systems costs
for the AEFLA program at the State
level.
Costs
Aligning Technology and Data Systems
Across One -Stop Partner Programs
For the future costs associated with
implementing strategies for aligning
technology and data systems across one-
stop partner programs ( see Exhibit 22),
the Departments estimated costs for
low-" and " high -effort" SWAs for DOL
core programs. We estimated the
consultant cost for " low -effort" SWAs
by multiplying the one-time consultant
cost ($100,000) by the number of "low -
effort" SWAs ( 23). This calculation
yields a one-time cost of $2. 3 million
2, 300, 000) in the first year of the Final
Rule, which is equal to an average
annual cost of $230,000 over the 10 -year
period.
The Departments estimated the
consultant cost for " high -effort" SWAs
55964 Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
by multiplying the sum of the
consultant cost for the first year of the
rule ($200,000) and for the second year
100, 000) by the number of " high -
effort" SWAs ( 34). This results in a 10 -
year total cost of $10. 2 million
10, 200, 000), which is equal to an
average annual cost of $1. 0 million
1, 020, 000).
The Departments estimated the
software and IT systems cost for " low -
effort" SWAs by multiplying the sum of
the cost for the first year of the rule
200, 000) and the cost for the second
and third years ($ 100, 000 per year) by
the number of " low -effort" SWAs ( 23).
This calculation yields a total 10 -year
cost of $9.2 million ($9,200,000), which
is equal to an average annual cost of
920, 000.
The Departments estimated the
software and IT systems cost for " high -
effort" SWAs by multiplying the sum of
the cost for the first and second years of
the rule ($200,000 per year) and the cost
in for the third year through the fifth
year ($ 100, 000 per year) by the number
of " high -effort" SWAs ( 34). This
calculation results in an average annual
cost of $2. 4 million ($2, 380,000), which
is equal to a total cost of $23. 8 million
23, 800, 000) over the 10 -year period.
For the State -level AEFLA program
see Exhibit 23), the Departments
estimated the software and IT systems
cost for States to enhance their
participation in the SLDS Grant Program
by multiplying the annual software and
IT cost ($ 100, 000) by the number of
States ( 57). This calculation results in a
total 10 -year cost of $57. 0 million
57, 000, 000), which is equal to an
average annual cost of $5. 7 million
5, 700, 000).
The Departments estimated
implementation and future alignment
costs for " low-" and " high -effort" VR
agencies ( see Exhibit 24). We estimated
the consultant cost for " low -effort" VR
agencies by multiplying the one-time
consultant cost ($100,000) by the
number of "low -effort" VR agencies
32). This calculation yields a one-time
cost of $3. 2 million ($3, 200,000) in the
first year of the rule, which is equal to
an average annual cost of $320, 000 over
the 10 -year period.
The Departments estimated the
consultant cost for " high -effort" VR
agencies by multiplying the sum of the
consultant cost for the first year of the
rule ($200,000) and the second year
100, 000) by the number of " high -
effort" VR agencies ( 48). This results in
a total 10 -year cost of $14.4 million
14,400,000), which is equal to an
average annual cost of $1. 4 million
1, 440, 000) over the 10 -year period.
The Departments estimated the
software and IT systems cost for " low -
effort" VR agencies by multiplying the
sum of the cost for the first year of the
rule ($200, 000) and the cost for the
second and third years ($ 100, 000 per
year) by the number of " low -effort" VR
agencies ( 32). This calculation yields a
total 10 -year cost of $12. 8 million
12,800,000), which is equal to an
average annual cost of $1. 3 million
1, 280, 000).
The Departments estimated the
software and IT systems cost for " high -
effort" VR agencies by multiplying the
sum of the cost for the first and second
years of the rule ($200,000 per year) and
the cost for the third year through the
fifth year ($ 100, 000 per year) by the
number of " high -effort" VR agencies
48). This calculation results in a total
10 -year cost of $33. 6 million
33,600,000), which is equal to an
average annual cost of $3. 4 million
3, 360, 000).
The sum of these potential costs for
aligning technologies and data systems
across one-stop partner programs yields
a total cost of $166. 5 million
166, 500, 000) in non -labor costs from
the SWAs, the State -level AEFLA
program, and VR agencies. Over the 10 -
year analysis, these costs result in an
average annual cost of $16. 7 million
16, 650,000).
Development and Updating of State
Performance Accountability Systems
For the costs related to developing
and updating State performance
accountability systems ( see Exhibit 13),
the Departments estimated the one-time
Federal software and IT systems cost for
DOL to be $ 750, 000 in the first year of
the Final Rule. This is equivalent to an
average annual cost of $75, 000.
At the State level for DOL core
programs (i.e., SWAs) (see Exhibit 16),
the Departments estimated this labor
cost by first multiplying the estimated
number of managers per SWA ( 1) by the
time required to develop and update the
performance accountability system ( 32
hours) and by the hourly compensation
rate ($ 65. 39/ hour). We performed the
same calculation for computer systems
analysts ( 3 analysts at $ 56. 17/ hour for
80 hours each) and office and
administrative support staff members ( 1
staff member at $ 30. 57/ hour for 72
hours). We summed the labor cost for all
three categories ($ 17, 774) and
multiplied the result by the number of
SWAs (57) to estimate a one-time cost
of $1. 0 million ($1, 013, 136). Over the
10 -year period, this calculation yields
an average annual cost of $101, 314.
The Departments estimated the
software and IT systems cost for SWAs
by multiplying the software and IT
systems cost per SWA ($100,000) by the
number of SWAs ( 57). This calculation
yields a one-time cost of $5. 7 million
5, 700, 000) in the first year of the rule,
which results in an average annual cost
of $570, 000 over the 10 -year period.
The Departments estimated the
licensing fees for SWAs by multiplying
the annual licensing fee per SWA
50, 000) by the number of SWAs ( 57).
This calculation results in an annual
cost of $2. 9 million ($2, 850,000), which
is equal to a 10 -year total cost of $28. 5
million.
The Departments estimated the
consultant cost for SWAs by
multiplying the consultant cost per
SWA ($ 75, 000) by the number of SWAs
57). This calculation yields a one-time
cost of $4. 3 million ($4, 275, 000) in the
first year of the rule, which is equal to
an average annual cost of $427, 500 over
the 10 -year period.
At the State level for the AEFLA
program (see Exhibit 17), the
Departments estimated this labor cost by
first multiplying the estimated number
of managers per State ( 1) by the time
required to develop and update the
performance accountability system ( 60
hours) and by the hourly compensation
rate ($ 65. 39/ hour). We repeated the
calculation for computer systems
analysts ( 1 analyst at $ 56. 17/ hour for 80
hours), social and community service
managers ( 3 managers at $ 54. 21/ hour for
60 hours each), and database
administrators (1 administrator at
57. 02/ hour for 80 hours). We summed
the labor cost for all four categories
22, 736) and multiplied the result by
the number of States ( 57), resulting in
an estimated one-time cost of $1. 3
million ($1, 295, 975). 44 Over the 10 -year
period, this calculation yields an
average annual cost of $129, 597.
The Departments estimated the
software and IT systems cost for the
State -level AEFLA program by
multiplying the software and IT systems
cost per State ($ 350, 000) by the number
of States ( 57). This calculation yields an
annual cost of $20. 0 million
19, 950, 000), which is equal to a total
10 -year cost of $199. 5 million
199, 500,000).
At the local level for the AEFLA
program (see Exhibit 20), the
Departments estimated this cost by first
multiplying the estimated number of
managers per local AEFLA provider (1)
by the time required to develop and
update the performance accountability
system ( 4 hours) and by the hourly
compensation rate ($ 63. 63/ hour). We
44 This provision will be a joint effort between
State and local AEFLA staff.
55965Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
performed the same calculation for
database administrators ( 1 administrator
at $ 59. 60/ hour for 4 hours). We summed
the labor cost for the two occupational
categories ($493) and multiplied the
result by the number of local AEFLA
providers ( 2, 396), resulting in a one-
time cost of $1. 2 million ($1, 181, 036).
Over the 10 -year period, this calculation
yields an average annual cost of
118, 104.
At the Federal level for the VR
program (see Exhibit 15), the
Departments estimated this labor cost by
first multiplying the estimated number
of GS -14 level, Step 5 data management
specialists ( 1) by the time required to
program the database and perform
related software development tasks
768. 63 hours) and by the hourly
compensation rate ($ 76. 48/ hour). We
performed the same calculation for GS -
13 level, Step 5 data management
specialists ( 1 specialist at $ 64. 71/ hour
for 768. 63 hours). We summed the labor
cost for both categories to estimate this
one-time cost of $108,523, which is
equal to an average annualized cost of
10, 852.
For State VR agencies ( see Exhibit 18),
the Departments estimated the cost
associated with the establishment of
State performance goals and the State' s
evaluation and analysis of progress
toward such goals by first multiplying
the estimated number of managers per
VR agency ( 1) by the time required to
develop and update the performance
accountability system ( 80 hours) and by
the hourly compensation rate ($ 65. 39/
hour). We repeated the calculation for
the following occupational categories:
Social and community service managers
3 managers at $ 54. 21/ hour for 80 hours
each), database administrators ( 2
administrators at $ 57. 02/ hour for 100
hours each), and SRC Board members
12 members at $ 45. 88/ hour for 3 hours
each). We summed the labor cost for the
four categories ($ 31, 297) and multiplied
the result by the number of VR agencies
80) to estimate the biennial cost as $ 2. 5
million ($2, 503, 782). In addition, to
estimate the cost of updating and
modifying VR agency case management
systems we multiplied the estimated
number of computer systems analysts
per large VR agency that is updating
case management and reporting systems
using in-house staff (5) by the time
required to make system changes ( 360)
and by the hourly compensation rate
56. 17/ hour). We multiplied the result
101, 106) by the number of large VR
agencies updating systems using in-
house staff (5) to estimate this one-time
cost of $505, 530. We then multiplied
the estimated number of computer
systems analysts per small or medium
VR agency that is updating case
management and reporting systems
using in-house staff (2) by the time
required to make system changes ( 360
hours) and by the hourly compensation
rate ($ 56. 17/ hour). We multiplied the
result ($40,442) by the number of small
and medium VR agencies updating
systems using in-house staff (45) to
estimate this one-time cost of $1. 8
million ($1, 819, 908). Finally, we
multiplied the estimated number of
computer systems analysts per VR
agency that has a maintenance contract
with a single CMS vendor (2) by the
time required to make system changes
54 hours) and by the hourly
compensation rate ($ 56. 17/ hour). We
multiplied the result ($6, 066) by the
number of VR agencies with a
maintenance contract (30) to estimate
this one-time cost of $181, 991. In total,
the sum of these calculations yields a
total 10 -year cost of $15. 0 million
15, 026, 341), which results in an
average annual cost of $1. 5 million
1, 502, 634) over the 10 -year period.
The Departments estimated the
annual licensing fees cost for State VR
agencies by multiplying the annual
licensing fee per VR agency ($ 6, 930) by
the number of VR agencies that receive
vendor -supplied CMS software (48).
This calculation results in an annual
cost of $332, 640, which is equal to a 10 -
year total cost of $3. 3 million
3, 326,400).
The sum of these costs for the
development and updating of State
performance accountability systems
yields a total 10 -year cost of $260. 7
million ($260, 676, 411) in costs from the
SWAs, AEFLA program, and VR
program. Over the 10 -year analysis
period, these costs result in an average
annual cost of $26. 1 million
26, 067,641).
The sum of the costs for individuals
from the Federal- and State -level DOL
core programs, State-and local -level
AEFLA programs, and Federal-and
State -level VR agencies to implement
strategies for aligning technology and
data systems across one-stop partners
and to develop and update the
performance accountability measures
yields a total 10 -year cost of $427. 2
million ($427, 176, 411) and an average
annual cost of $42. 7 million
42, 717,641).
ii. Effectiveness in Serving Employers
WIOA sec. 116(b)( 2)( A)(i)(VI)
provides that the sixth primary
indicator of performance will be an
indicator of effectiveness in serving
employers, which will be established
pursuant to WIOA sec. 116(b)( 2)( A)(iv).
This indicator will measure program
effectiveness in serving employers.
Under WIOA sec. 116(b)( 2)( A)(iv), the
Departments must consult with
stakeholders on proposed approaches to
defining this indicator. The NPRM
described three approaches to measure
employer satisfaction. In the first
approach, States would use wage
records to identify whether a
participant' s identification matches the
same FEIN in the second and fourth
quarters. The second approach to define
this performance indicator would use
the number or percentage of employers
that are using the core program services
out of all employers represented in an
area or State served by the system ( i.e.,
employers served). The third approach
would measure the repeated use rate for
employers' use of the core programs.
Both the market penetration and repeat
business measure should come from
already existing data sources. For
market penetration, States will have to
produce the total number of business
customers, as well as the total number
of businesses, which is readily available
through BLS. For repeat businesses,
these figures will also come from the
business customer database and will be
shown as a sum within the reporting
period.
In this Final Rule, the Departments
are initially implementing the
performance indicator of effectiveness
in serving employers in the form of a
pilot program to test the rigor and
feasibility of the three proposed
approaches and to develop a
standardized indicator. The
performance indicator for effectiveness
in serving employers will not be
included in sanctions determinations
until the standardized indicator is
developed in accordance with
rulemaking requirements. The WIOA
Joint Performance ICR and the DOL
Performance ICR include the data
elements and specifications to calculate
all three measures proposed in the
NPRM (employee retention with the
same employer, market penetration, and
repeat business). States will be required
to choose two of the three measures of
effectiveness in serving employers for
data collection and reporting for PYs
2016 and 2017 with results to be
included in the WIOA annual reports
due in October.
The Departments cannot anticipate
which of the three approaches States
will select, limiting our ability to
estimate the cost of these activities. Due
to this uncertainty, the Departments
estimated the costs of the pilot program
in 2016 and 2017 using the assumption
that the realized cost will be the
midpoint of the range of the total costs
if on the low end, all States choose the
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two lowest -cost approaches; if on the
high end, all States choose the two
highest -cost approaches. The
Departments similarly estimated the
cost of the implementation beginning in
2019 using the assumption that this cost
will be the midpoint of the range of the
total costs if on the low end, all States
choose the lowest -cost approach; on the
high end, all States choose the highest -
cost approach. Below we discuss the
estimated costs for each approach in the
pilot program if all States were to
choose that approach. We then use these
values to estimate the cost of this
provision as discussed.
Costs
Approach 1— Retention With the Same
Employer
At the Federal level for the DOL core
programs, the Departments estimated
the one-time labor cost associated with
the first approach by multiplying the
estimated number of GS -14, Step 5
management analysts ( 1) by the time
required for technical assistance
development (8 hours) and by the
hourly compensation rate ($ 76. 48/ hour).
This calculation would result in a one-
time labor cost of $612.
The Departments estimated DOL' s
annual labor costs for the first approach
by multiplying the estimated number of
GS -14, Step 5 management analysts ( 1)
by the time required for technical
assistance delivery (4 hours) and by the
hourly compensation rate ($ 76. 48/ hour).
This calculation would result in an
annual labor cost of $306.
At the State level for the DOL core
programs, the Departments estimated
the first approach' s one-time labor cost
by multiplying the estimated number of
management analysts ( 1) by the time
required for programming and data
collection (8 hours) and by the hourly
compensation rate ($ 45. 88/ hour). We
multiplied the labor cost ($ 367) by the
number of States ( 57) to estimate this
one-time cost of $20,921.
The Departments estimated the State -
level DOL core programs' annual labor
cost associated with the first approach
in the pilot program by multiplying the
estimated number of management
analysts ( 1) by the sum of time required
for data collection (4 hours) and for
Federal reporting (4 hours) and by the
hourly compensation rate ($ 45. 88/ hour).
We multiplied the labor cost ($ 367) by
the number of States ( 57) to estimate
this annual cost of $20, 291.
At the Federal level for the AEFLA
program, the Departments estimated the
one-time labor cost associated with the
first approach in the pilot program by
multiplying the estimated number of
GS -14, Step 5 management analysts ( 1)
by the time required for technical
assistance development (8 hours) and by
the hourly compensation rate ($ 76. 48/
hour). This calculation would result in
a one-time labor cost of $612.
The Departments estimated AEFLA' s
annual labor cost for the first approach
by multiplying the estimated number of
GS -14, Step 5 management analysts ( 1)
by the time required for technical
assistance delivery (4 hours) and by the
hourly compensation rate ($76.48/hour).
This calculation would result in an
annual labor cost of $306.
At the State level for the AEFLA
program, the Departments estimated the
first approach' s one-time labor cost by
multiplying the estimated number of
management analysts ( 1) by the time
required for programming and data
collection (8 hours) and by the hourly
compensation rate ($ 45. 88/ hour). We
multiplied the labor cost ($ 367) by the
number of States ( 57) to estimate this
one-time cost of $20,921.
The Departments estimated the State -
level AEFLA program' s annual labor
cost associated with the first approach
by multiplying the estimated number of
management analysts (1) by the sum of
time required for data collection (4
hours) and for Federal reporting (4
hours) and by the hourly compensation
rate ($ 45. 88/ hour). We multiplied the
labor cost ($ 367) by the number of
States ( 57) to estimate this annual cost
of $20, 921.
At the Federal level for the VR
program, the Departments estimated the
one-time labor cost associated with the
first approach in the pilot program by
multiplying the estimated number of
GS -14, Step 5 management analysts ( 1)
by the time required for technical
assistance development (8 hours) and by
the hourly compensation rate ($ 76. 48/
hour). This calculation would result in
a one-time labor cost of $612.
The Departments estimated the
annual labor costs for the VR program
associated with the first approach by
multiplying the estimated number of
GS -14, Step 5 management analysts ( 1)
by the time required for technical
assistance delivery (4 hours) and by the
hourly compensation rate ($76.48/hour).
This calculation would result in an
annual labor cost of $306.
At the State level for the VR program,
the Departments estimated the first
approach' s one-time labor cost by
multiplying the estimated number of
management analysts (1) by the time
required for programming and data
collection (8 hours) and by the hourly
compensation rate ($ 45. 88/ hour). We
multiplied the labor cost ($ 367) by the
number of VR agencies ( 80) to estimate
this one-time cost of $29,363.
The Departments estimated the State -
level AEFLA program' s annual labor
cost associated with the first approach
by multiplying the estimated number of
management analysts ( 1) by the sum of
time required for data collection (4
hours) and for Federal reporting (4
hours) and by the hourly compensation
rate ($ 45. 88/ hour). We multiplied the
labor cost ($ 367) by the number of VR
agencies ( 80) to estimate this annual
cost of $29, 363.
In total, Approach 1 would result in
one-time costs of $73, 041 for
individuals from the Federal- and State -
level DOL core programs, AEFLA
program, and VR program. In addition,
Approach 1 would result in $72, 123 in
annual costs for these entities.
Approach 2— Percentage of Employers
Using Services Out of All Employers in
the State
At the Federal level for the DOL core
programs, the Departments estimated
the one-time labor cost associated with
the second approach in the pilot
program by multiplying the estimated
number of GS -14, Step 5 management
analysts ( 1) by the time required for
technical assistance development (8
hours) and by the hourly compensation
rate ($ 76.48/ hour). This calculation
would result in a one-time labor cost of
612.
The Departments estimated DOL' s
annual labor cost associated with the
second approach by multiplying the
estimated number of GS -14, Step 5
management analysts ( 1) by the time
required for technical assistance
delivery (4 hours) and by the hourly
compensation rate ($ 76. 48/ hour). This
calculation would result in an annual
labor cost of $306.
At the State level for the DOL core
programs, the Departments estimated
the second approach' s annual labor cost
by multiplying the estimated number of
management analysts ( 1) by the sum of
time required for data collection (4
hours), providing training and technical
assistance to Local WDBs ( 3 hours), and
Federal reporting (4 hours) and by the
hourly compensation rate ($ 45. 88/ hour).
We multiplied the labor cost ($ 505) by
the number of States ( 57) to estimate
this annual cost of $28, 767.
For local -level DOL core programs,
the Departments estimated the annual
labor cost for the second approach by
multiplying the estimated number of
management analysts ( 1) by the time
required for data collection (4 hours)
and by the hourly compensation rate
60. 60/ hour). We multiplied the labor
cost ($ 242) by the number of Local
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WDBs ( 580) to estimate this annual cost
of $140, 592.
At the Federal level for the AEFLA
program, the Departments estimated the
one-time labor cost associated with the
second approach in the pilot program by
multiplying the estimated number of
GS -14, Step 5 management analysts ( 1)
by the time required for technical
assistance development (8 hours) and by
the hourly compensation rate ($ 76.48/
hour). This calculation would result in
a one-time labor cost of $612.
The Departments estimated AEFLA' s
annual labor cost associated with the
second approach by multiplying the
estimated number of GS -14, Step 5
management analysts ( 1) by the time
required for technical assistance
delivery (4 hours) and by the hourly
compensation rate ($ 76. 48/ hour). This
calculation would result in an annual
labor cost of $306.
At the State level for the AEFLA
program, the Departments estimated the
second approach' s annual labor cost by
multiplying the estimated number of
management analysts ( 1) by the sum of
time required for data collection (4
hours), providing training and technical
assistance to local AEFLA providers (3
hours), and Federal reporting (4 hours)
and by the hourly compensation rate
45. 88/ hour). We multiplied the labor
cost ($ 505) by the number of States ( 57)
to estimate this annual cost of $28, 767.
For the local -level AEFLA program,
the Departments estimated the annual
labor cost for the second approach by
multiplying the estimated number of
management analysts ( 1) by the time
required for data collection (4 hours)
and by the hourly compensation rate
60. 60/ hour). We multiplied the labor
cost ($ 242) by the number of local
AEFLA providers (2, 396) to estimate
this annual cost of $580, 790.
At the Federal level for the VR
program, the Departments estimated the
one-time labor cost associated with the
second approach in the pilot program by
multiplying the estimated number of
GS -14, Step 5 management analysts ( 1)
by the time required for technical
assistance development (8 hours) and by
the hourly compensation rate ($ 76.48/
hour). This calculation would result in
a one-time labor cost of $612.
The Departments estimated the VR
program' s annual labor cost associated
with the second approach by
multiplying the estimated number of
GS -14, Step 5 management analysts ( 1)
by the time required for technical
assistance delivery (4 hours) and by the
hourly compensation rate ($ 76. 48/ hour).
This calculation would result in an
annual labor cost of $306.
At the State level for the VR program,
the Departments estimated the second
approach' s one-time labor cost by
multiplying the estimated number of
staff trainers ( 1) by the time required for
training of rehabilitation counselors (4
hours) and by the hourly compensation
rate ($ 54. 21/ hour). We repeated the
calculation for the rehabilitation
counselors (62 assistants at $36.66/ hour
for 1 hour each). We summed the labor
cost for both categories ($ 2, 490) and
multiplied it by the number of VR
agencies ( 80) to estimate this one-time
cost of $199, 181.
The Departments estimated the State -
level VR program' s annual labor cost
associated with the second approach by
multiplying the estimated number of
management analysts ( 1) by the time
required for Federal reporting (4 hours)
and by the hourly compensation rate
45. 88/ hour). In addition, we added the
estimated number of rehabilitation
counselors (62 assistants) by the time
required for data collection (1 hour
each) and by the hourly compensation
rate ($ 36. 66/ hour). We summed the
labor cost for both categories ($ 2, 456)
and multiplied it by the number of VR
agencies ( 80) to estimate this annual
cost of $196, 515.
In total, Approach 2 would result in
one-time costs of $201, 016 for
individuals from the Federal -level DOL
core programs, AEFLA program, and VR
program and the State -level VR
program. In addition, Approach 2 would
result in $976, 349 in annual costs for
the Federal-, State-, and local -level DOL
core programs and AEFLA program and
the State -level VR program.
Approach 3— Percentage of Repeat
Employers Using Services Within the
Previous 3 Years
At the Federal level for the DOL core
programs, the Departments estimated
the one-time labor cost associated with
the third approach in the pilot program
by multiplying the estimated number of
GS -14, Step 5 management analysts ( 1)
by the time required for technical
assistance development (8 hours) and by
the hourly compensation rate ($ 76. 48/
hour). This calculation would result in
a one-time labor cost of $612.
The Departments estimated DOL' s
annual labor cost associated with the
third approach by multiplying the
estimated number of GS -14, Step 5
management analysts ( 1) by the time
required for technical assistance
delivery (4 hours) and by the hourly
compensation rate ($ 76.48/ hour). This
calculation would result in an annual
labor cost of $306.
At the State level for the DOL core
programs, the Departments estimated
the third approach' s annual labor cost
by multiplying the estimated number of
management analysts ( 1) by the sum of
time required for data collection (4
hours), providing training and technical
assistance to Local WDBs ( 3 hours), and
Federal reporting (4 hours) and by the
hourly compensation rate ($ 45. 88/ hour).
We multiplied the labor cost ($ 505) by
the number of States ( 57) to estimate
this annual cost of $28, 767.
For the local -level DOL core
programs, the Departments estimated
the annual labor cost for third approach
in the pilot program by multiplying the
estimated number of management
analysts ( 1) by the time required for data
collection (6 hours) and by the hourly
compensation rate ($ 60. 60/ hour). We
multiplied the labor cost ($ 364) by the
number of Local WDBs ( 580) to estimate
this annual cost of $210, 888.
At the Federal level for the AEFLA
program, the Departments estimated the
one-time labor cost associated with the
third approach in the pilot program by
multiplying the estimated number of
GS -14, Step 5 management analysts ( 1)
by the time required for technical
assistance development (8 hours) and by
the hourly compensation rate ($ 76.48/
hour). This calculation would result in
a one-time labor cost of $612.
The Departments estimated AEFLA' s
annual labor cost associated with the
third approach by multiplying the
estimated number of GS -14, Step 5
management analysts ( 1) by the time
required for technical assistance
delivery (4 hours) and by the hourly
compensation rate ($ 76. 48/ hour). This
calculation would result in an annual
labor cost of $306.
At the State level for the DOL core
programs, the Departments estimated
the third approach' s annual labor cost
by multiplying the estimated number of
management analysts ( 1) by the sum of
time required for data collection (4
hours), providing training and technical
assistance to local AEFLA providers (3
hours), and Federal reporting (4 hours)
and by the hourly compensation rate
45. 88/ hour). We multiplied the labor
cost ($ 505) by the number of States ( 57)
to estimate this annual cost of $28, 767.
For the local -level AEFLA program,
the Departments estimated the annual
labor cost for the third approach by
multiplying the estimated number of
management analysts ( 1) by the time
required for data collection (6 hours)
and by the hourly compensation rate
60. 60/ hour). We multiplied the labor
cost ($ 364) by the number of local
AEFLA providers (2, 396) to estimate
this annual cost of $871, 186.
At the Federal level for the VR
program, the Departments estimated the
55968 Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
one-time labor cost associated with the
third approach in the pilot program by
multiplying the estimated number of
GS - 14, Step 5 management analysts ( 1)
by the time required for technical
assistance development (8 hours) and by
the hourly compensation rate ($ 76.48/
hour). This calculation would result in
a one-time labor cost of $612.
The Departments estimate the VR
program' s annual labor cost associated
with the third approach by multiplying
the estimated number of GS -14, Step 5
management analysts ( 1) by the time
required for technical assistance
delivery (4 hours) and by the hourly
compensation rate ($ 76. 48/ hour). This
calculation would result in an annual
labor cost of $306.
At the State level for the VR program,
the Departments estimated the third
approach' s one-time labor cost by
multiplying the estimated number of
staff trainers ( 1) by the time required for
training of rehabilitation counselors (4
hours) and by the hourly compensation
rate ($ 54. 21/ hour). We repeated the
calculation for the rehabilitation
counselors (62 counselors at $36.66/
hour for 1 hour each). We summed the
labor cost for both categories ($ 2, 490)
and multiplied it by the number of VR
agencies ( 80) to estimate this one-time
cost of $199, 181.
The Departments estimated the State -
level VR program annual labor cost
associated with the third approach by
multiplying the estimated number of
management analysts ( 1) by the time
required for Federal reporting (4 hours)
and by the hourly compensation rate
45. 88/ hour). In addition, we added the
estimated number of rehabilitation
counselors ( 62 counselors) by the time
required for data collection (1 hour
each) and by the hourly compensation
rate ($ 36. 66/ hour). We summed the
labor cost for both categories ($ 2, 456)
and multiplied it by the number of VR
agencies ( 80) to estimate this annual
cost of $196, 515.
In total, Approach 3 would result in
one-time costs of $201, 016 for
individuals from the Federal -level DOL
core programs, AEFLA program, and VR
program and the State -level VR
program. In addition, Approach 3 would
result in $1. 3 million (1, 337, 040) in
annual costs for the Federal-, State-, and
local -level DOL core programs and
AEFLA program and the State -level VR
program.
As presented in Exhibit 49, Approach
1 is the lowest -cost approach with
73, 041 in one-time costs and $ 72, 124
in annual costs for Federal- and State -
level costs for DOL, AEFLA, and the VR
program. Approach 3 is the highest -cost
approach with $201,016 in one-time
costs and $ 1. 3 million ($1, 337,040) in
annual costs for Federal-, State-, and
local -level costs for DOL and AEFLA
and Federal-and State -level costs for
the VR program.
EXHIBIT 49— ESTIMATED COST OF THE PILOT PROGRAM BY APPROACH
Approach
Approach 1— Retention with the Same Employer
Approach 2— Percentage of Employers Using Services Out of All Employers in the State
Approach 3— Percentage of Repeat Employers Using Services within the Previous 3 Years
The Departments estimated the one-
time labor cost for the pilot program to
be incurred in 2016 and the annual
labor cost to be incurred in 2017 by
taking the average of the low-end range
of costs (i.e., if all States were to choose
the two lowest -cost approaches) and the
high-end range of costs (i.e., if all States
were to choose the two highest -cost
approaches). If all States chose the two
lowest -cost approaches (i.e.,
Approaches 1 and 2), the one-time cost
to the States would be $ 274, 057
73, 041 + $ 201, 016). If all States chose
the two highest -cost approaches (i.e.,
Approaches 2 and 3), the one-time cost
to the States would be $ 402, 032
201, 016 + $ 201, 016). We took the
average of this range to estimate the one-
time cost of the pilot program of
338, 045 to be incurred in 2016. We
repeated this calculation to estimate the
annual cost for the pilot program. If all
States chose the two lowest -cost
approaches, the annual cost to the States
would be $ 1. 0 million ($1, 048, 473)
72, 124 + $ 976, 349). If all States chose
the two highest -cost approaches, the
annual cost to the States would be $ 2. 0
million ($2, 313, 389) ($ 976, 349 +
1, 337, 040). We took the average of this
range to estimate the annual cost of the
pilot program of $1. 7 million
1, 680, 931) to be incurred in 2017. The
sum of these calculations results in a
total 10 -year cost of $2. 0 million
2, 018, 976), which is equal to an
average annual cost of $201, 898 for the
pilot program.
The Departments estimated the one-
time labor cost for implementation to be
incurred in 2019 and the annual labor
cost to be incurred annually starting in
2020 by taking the average of the low-
end range of costs (i.e., if all States were
to choose the lowest -cost approach) and
the high-end range of costs (i.e., if all
States were to choose the highest -cost
approach). If all States chose the lowest -
cost approach (i.e., Approach 1), the
one-time cost to the States would he
73, 041. If all States chose the highest -
cost approach (i.e., Approach 2), the
one-time cost to the States would be
201, 016. We took the average of this
range to estimate the one-time cost of
the program of $137,029 to be incurred
in 2019. We repeated this calculation to
estimate the annual cost for the
program. If all States chose the lowest -
cost approach, the annual cost to the
States would be $ 72, 124. If all States
chose the highest -cost approach, the
annual cost to the States would be $ 1. 3
million ($1, 337, 040). We took the
average of this range to estimate the
annual cost of the program of $704, 582
to be incurred beginning in 2020. The
One-time cost Annual cost
73, 041 72, 124
201, 016 976,349
201, 016 1, 337,040
sum of these calculations results in a
total 10 -year cost of $4. 4 million
4, 364, 521), which is equal to an
average annual cost of $436,452 for the
implementation.
The sum of the costs for the pilot
program and the implementation results
in a total 10 -year cost of $6. 4 million
6, 383, 497), which is equal to an
average annual cost of $638, 350 for the
implementation.
iii. Negotiation of Levels of Performance
WIOA sec. 116(b)( 3) requires States to
negotiate with DOL and ED and agree on
levels of performance for each
performance indicator for each core
program every 2 years. States must
establish expected levels of performance
for each of the six core programs in the
submitted Unified or Combined State
Plan. Prior to approving the Unified or
Combined State Plan, however, DOL
and ED must negotiate with the States
to agree on an adjusted performance
level (referred to as a " negotiated level
of performance" in § 677.170(b) of these
final regulations). The negotiated level
of performance must be incorporated
into the Unified or Combined Plan prior
to its approval. The negotiated levels of
performance are based on factors
including how the expected levels
compare to other States, the statistical
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adjustment model, the extent to which
the levels promote continuous
improvement, and the extent to which
the levels will assist the State in
meeting its long-term performance
goals. This negotiation of levels of
performance will result in recurring
costs incurred by each core program.
Costs will be incurred by entities at
Federal, State, and local levels to
negotiate adjusted levels of
performance. Specifically, biennial
labor costs will be incurred at the
Federal, State, and local levels for the
DOL core programs, at the Federal and
State levels for the AEFLA program, and
at the Federal and State levels for the
VR program.
Costs
At the Federal level for DOL core
programs ( see Exhibit 13), the
Departments estimated this labor cost by
first multiplying the estimated number
of GS -14 level, Step 5 managers ( 1) by
the time required to negotiate levels of
performance ( 8 hours) and by the hourly
compensation rate ($ 76. 48/ hour). We
performed the same calculation for GS -
12 level, Step 5 management analysts ( 2
analysts at $ 54.43/ hour for 8 hours
each). We summed the labor cost for
both categories to estimate this biennial
cost of $1, 483. This calculation results
in a total 10 -year cost of $7, 414, which
is equal to an average annual cost of
741.
At the State level for DOL core
programs ( see Exhibit 16), the
Departments estimated this labor cost by
first multiplying the estimated number
of managers per State ( 1) by the time
required to negotiate levels of
performance ( 8 hours) and by the hourly
compensation rate ($ 65. 39/ hour). We
performed the same calculation for
office and administrative support staff
members ( 2 staff members at $ 30. 57/
hour for 8 hours each). We summed the
labor cost for both categories ($ 1, 012)
and multiplied the result by the number
of States ( 57). This calculation yields a
biennial cost of $57, 698. Over the 10 -
year period, this calculation results in a
total cost of $288, 488, which is equal to
an average annual cost of $28, 849.
At the local level for DOL core
programs ( see Exhibit 19), the
Departments estimated this labor cost by
first multiplying the estimated number
of managers per Local WDB ( 1) by the
time required to negotiate levels of
performance (8 hours) and by the hourly
compensation rate ($ 63. 63/ hour). We
performed the same calculation for
office and administrative support staff
members ( 2 staff members at $ 29. 36/
hour for 8 hours each). We summed the
labor cost for both categories ($ 979) and
multiplied the result by the number of
Local WDBs ( 580), which results in a
biennial cost of $567, 704. This
calculation results in a total 10 -year cost
of $2. 8 million ($2, 838, 520), which is
equal to an average annual cost of
283, 852.
At the Federal level for the AEFLA
programs (see Exhibit 14), the
Departments estimated this labor cost by
first multiplying the estimated number
of GS -14 level, Step 5 managers ( 4) by
the time required to negotiate levels of
performance ( 24 hours each) and by the
hourly compensation rate ($76.48/hour).
We performed the same calculation for
GS -13 level, Step 5 social and
community service managers ( 4
managers at $ 64. 71/ hour for 24 hours
each). We summed the labor cost for
both categories to estimate this biennial
cost of $13, 554. Over the 10 -year period,
this calculation yields a total cost of
67, 771, which is equal to an average
annual cost of $6, 777.
At the State level for the AEFLA
program (see Exhibit 17), the
Departments estimated this labor cost by
first multiplying the estimated number
of managers per State ( 1) by the time
required to negotiate levels of
performance ( 12 hours) and by the
hourly compensation rate ($ 65. 39/ hour).
We repeated the calculation for social
and community service managers ( 1
manager at $ 54. 21/ hour for 12 hours).
We summed the labor cost for both
categories ($ 1, 435) and multiplied the
result by the number of States ( 57). This
calculation results in a biennial cost of
81, 806. Over the 10 -year period, this
calculation results in a total cost of
409, 032, which is equal to an average
annual cost of $40, 903.
At the Federal level for the VR
program (see Exhibit 15), the
Departments estimated this biennial
labor cost by first multiplying the
estimated number of GS -14 level, Step
5 managers ( 4) by the time required to
negotiate levels of performance ( 12
hours each) and by the hourly
compensation rate ($ 76.48/ hour).45 The
biennial labor cost of $3, 671 results in
a total 10 -year cost of $18, 355, which is
equal to an average annual cost of
1, 836.
For State VR agencies ( see Exhibit 18),
the Departments estimated the cost of
negotiating levels of performance by
first multiplying the estimated number
of managers per VR agency ( 1) by the
time required to negotiate adjusted
levels of performance ( 12 hours) and by
the hourly compensation rate ($ 65. 39/
hour). We repeated the calculation for
45 Managers include data, VR program, State
liaison, and unit chief participation.
the following occupational categories:
social and community service managers
2 managers at $ 54. 21/ hour for 12 hours
each) and management analysts ( 2
analysts at $ 45. 88/ hour for 12 hours
each). We summed the labor cost for the
three categories ($ 3, 187) and multiplied
the result by the number of VR agencies
80) to estimate this biennial cost as
254,947. This calculation results in a
10 -year cost of $1. 3 million
1, 274, 736), which is equal to an
average annual cost of $127,474 over the
10 -year analysis period.
The sum of these calculations yields
a biennial cost of $980, 863 for
individuals from the Federal, State, and
local level for the DOL core programs,
from the Federal-and State -levels for
the AEFLA program, and from the
Federal and State levels for the VR
program to negotiate levels of
performance. This results in a total 10 -
year cost of $4.9 million ($4,904,316),
which is equal to an average annual cost
of $490, 432.
iv. Running Statistical Adjustment
Model To Adjust Levels of Performance
Based on Actual Economic Conditions
and Characteristics of Participants
WIOA sec. 116(b)( 3) requires DOL,
ED, and States to ensure that negotiated
levels of performance are adjusted using
a statistical adjustment model—
developed and disseminated by DOL
and ED— based on the differences
among States in (1) actual economic
conditions ( including differences in
unemployment rates and job losses or
gains in particular industries) and ( 2)
the characteristics of participants when
they entered the relevant program
including indicators of poor work
history, lack of work experience, lack of
education or occupational skills
attainment, dislocation from high -wage
and high -benefit employment, low
levels of literacy or English proficiency,
disability status, homelessness, ex -
offender status, and welfare
dependency). Regularly adjusting the
levels of performance for each primary
performance indicator for each core
program will result in annual costs
being incurred at the Federal, State, and
local levels for the DOL core programs,
at the Federal level for the AEFLA
program, and at the Federal and State
levels for the VR program to collect and
update data on participants.
Furthermore, DOL will experience costs
related to annual licensing fees.
Costs
At the Federal level for DOL core
programs ( see Exhibit 13), the
Departments estimated this labor cost by
first multiplying the estimated number
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of GS -14 level, Step 5 managers ( 1) by
the time required to collect and update
data on the core programs' participants
250 hours) and by the hourly
compensation rate ($ 76. 48/ hour). We
performed the same calculation for GS -
13 level, Step 5 computer systems
analysts ( 2 analysts at $ 64. 71/ hour for
1, 000 hours each). We summed the
labor cost for both categories to estimate
this annual cost of $148, 540, which
results in a total 10 -year cost of $1. 5
million ($1, 485, 400). 46
The Departments estimated the
annual licensing fee for DOL to be
10,000, or a total cost of $100,000 over
the 10 -year analysis period.
At the State level for DOL core
programs ( see Exhibit 16), the
Departments estimated this labor cost by
first multiplying the estimated number
of managers per State ( 1) by the time
required to collect and update data on
the programs' participants ( 10 hours)
and by the hourly compensation rate
65. 39/ hour). We performed the same
calculation for the following
occupational categories: computer
systems analysts ( 2 analysts at $ 56. 17/
hour for 40 hours each) and office and
administrative support staff members ( 2
staff members at $ 30. 57/ hour for 20
hours each). We summed the labor cost
for the three categories ($ 6, 370) and
multiplied the result by the number of
States ( 57) to estimate this annual cost
of $363, 107. This result is equal to a
total 10 -year cost of $3. 6 million
3, 631, 071).
At the local level for DOL core
programs ( see Exhibit 19), the
Departments estimated this labor cost by
first multiplying the estimated number
of managers per Local WDB ( 1) by the
time required to collect and update data
on the programs' participants (10 hours)
and by the hourly compensation rate
63. 63/ hour). We performed the same
calculation for the following
occupational categories: computer
systems analysts ( 2 analysts at $ 60. 76/
hour for 40 hours each) and office and
administrative support staff members ( 2
staff members at $ 29. 36/ hour for 20
hours each). We summed the labor cost
for both categories ($ 6, 672) and
multiplied the result by the number of
Local WDBs ( 580). The annual cost is
estimated to be $ 3. 9 million
3, 869, 470), which results in a 10 -year
total cost of $38. 7 million ($38, 694, 700).
At the Federal level for the AEFLA
program (see Exhibit 14), the
Departments estimated this labor cost by
46 For DOL programs, the Federal program will
experience the heaviest burden as ETA will
produce all State and local calculations and
disseminate them to States and local areas.
first multiplying the estimated number
of GS - 14 level, Step 5 managers ( 2) by
the time required to provide Federal
oversight and technical assistance ( 40
hours each) and by the hourly
compensation rate ($ 76.48/ hour). We
performed the same calculation for GS -
12 level, Step 5 management analysts ( 2
analysts at $54.43/ hour for 80 hours
each). We summed the labor cost for
both categories to estimate this annual
cost of $14, 827, which results in a total
10 -year cost of $148, 272.
At the Federal level for the VR
program (see Exhibit 15), the
Departments estimated this biennial
labor cost by first multiplying the
estimated number of GS -14 level, Step
5 managers ( 2) by the time required to
collect and update data on its
participants (52 hours each) and by the
hourly compensation rate ($ 76.48/
hour).47 The Departments repeated the
calculation for GS -13 level, Step 5
database administrators (2
administrators at $ 64. 71/ hour for 156
hours each). We summed the annual
labor cost for the two categories
28, 143), which results in a total 10 -
year cost of $281, 434.
For State VR agencies ( see Exhibit 18),
the Departments estimated this cost by
first multiplying the estimated number
of managers per VR agency ( 1) by the
time required to collect and update data
on its participants (4 hours) and by the
hourly compensation rate ($ 65. 39/ hour).
We repeated the calculation for the
following occupational categories:
Database administrators (1 administrator
at $ 57. 02/ hour for 20 hours), computer
systems analysts ( 1 analyst at $ 56. 17/
hour for 4 hours), and management
analysts ( 1 analyst at $ 45. 88/ hour for 4
hours). We summed the labor cost for
the four categories ($ 1, 810) and
multiplied the result by the number of
VR agencies ( 80) to estimate this annual
cost as $ 144,813, which results in a total
10 -year cost of $1. 4 million
1, 448, 128).
The sum of these calculations yields
an annual cost of $4. 6 million
4, 578, 901) for individuals from the
Federal, State, and local levels for the
DOL core programs, the Federal level for
the AEFLA program, and the Federal
and State levels for the VR program to
collect and update data on their
participants. This is equal to a 10 -year
total cost of $45. 8 million ($45, 789, 005).
47 Managers will include data unit database
administrative staff and management staff.
v. Additional State Performance
Accountability Indicators ( Beyond
Required Performance Indicators)
Under WIOA sec. 116( b), States must
include levels of performance for the six
primary performance indicators in their
Unified or Combined State Plans. In
addition, WIOA sec. 116( b)( 2)( B)
permits States to identify in the State
Plan additional performance
accountability indicators for the core
programs beyond the six required
primary indicators. Although States had
similar latitude under WIA, no State has
ever established additional performance
indicators. Therefore, the Departments
do not expect any State to establish
additional performance accountability
indicators under WIOA. If a State
chooses to do so, however, we have
conservatively calculated a burden
estimate based on five States
establishing additional indicators of
performance. The costs associated with
this activity are those incurred by State -
level DOL core programs, State-and
local -level AEFLA programs, and State
VR agencies having to collect additional
data to report on the additional
performance indicators in the first year
of the Final Rule.
Costs
At the State level for DOL core
programs ( see Exhibit 31), the
Departments estimated this labor cost by
first multiplying the estimated number
of managers per State providing
additional data ( 1) by the time required
to collect additional data ( 16 hours) and
by the hourly compensation rate
65. 39/ hour). We performed the same
calculation for computer systems
analysts ( 3 analysts at $ 56. 17/ hour for
40 hours each) and office and
administrative support staff members ( 1
staff member at $ 30. 57/ hour for 36
hours). We summed the labor cost for all
three categories ($ 8, 887) and multiplied
the result by the number of States
providing additional data ( 5) to estimate
this one-time cost of $44,436. Over the
10 -year period, this calculation yields
an average annual cost of $4, 444.
At the State level for the AEFLA
program (see Exhibit 32), the
Departments estimated this labor cost by
first multiplying the estimated number
of managers per State providing
additional data ( 1) by the time required
to collect additional data ( 8 hours) and
by the hourly compensation rate
65. 39/ hour). We repeated the
calculation for the following
occupational categories: Database
administrators (1 administrator at
57. 02/ hour for 8 hours), computer
systems analysts (1 analyst at $ 56. 17/
55971Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
hour for 8 hours), and social and
community service managers ( 3
managers at $ 54. 21/ hour for 8 hours
each). We summed the labor cost for all
four categories ($ 2, 730) and multiplied
the result by the number of States
providing additional data ( 5) to estimate
this one-time cost of $13,648.48 Over the
10 -year period, this calculation yields
an average annual cost of $1, 365.
At the local level for the AEFLA
program (see Exhibit 34), the
Departments estimated this cost by first
multiplying the estimated number of
managers per local AEFLA provider
proving additional data ( 1) by the time
required to collect additional data ( 4
hours) and by the hourly compensation
rate ($ 63. 63/ hour). We performed the
same calculation for database
administrators (1 administrator at
59. 60/ hour for 4 hours). We summed
the labor cost for the two occupational
categories ($493) and multiplied the
result by the number of local AEFLA
providers providing additional data
200) to estimate this one-time cost of
98, 584. Over the 10 -year period, this
calculation yields an average annual
cost of $9, 858.
For State VR agencies ( see Exhibit 33),
the Departments estimated this cost by
first multiplying the estimated number
of managers per VR agency providing
additional data ( 1) by the time required
to collect additional data ( 8 hours) and
by the hourly compensation rate
65. 39/ hour). We repeated the
calculation for the following
occupational categories: Database
administrators (1 administrator at
57. 02/ hour for 8 hours), computer
systems analysts (1 analyst at $ 56. 17/
hour for 8 hours), and social and
community service managers ( 3
managers at $ 54. 21/ hour for 8 hours
each). We summed the labor cost for the
four categories ($ 2, 730) and multiplied
the result by the number of VR agencies
providing additional data ( 5) to estimate
this one-time cost as $ 13,648. Over the
10 -year period, this calculation yields
an average annual cost of $1, 365.
The sum of these calculations yields
a total first-year cost of $170, 317 from
the State -level DOL core programs,
State-and local -level AEFLA programs,
and State VR agencies to collect
additional data. This is equal to an
average annual cost of $17, 032.
vi. Technical Assistance to States
The cost of this activity reflects the
Federal cost for procuring a consultant
to provide technical assistance to States
in the collection of data to comply with
48 This provision will be a joint effort between
State and local AEFLA staff.
the new performance accountability
requirements of WIOA. The cost for this
activity was not included in the NPRM,
because the FY 2017 budget request was
in the process of being developed. For
FY 2017, the Administration requested
funds to help meet WIOA performance
requirements through improved data
infrastructure along with $1 million for
ED to provide technical assistance to
help AEFLA grantees comply with the
new requirements, including the
collection of new WIOA data elements.
The total 10 -year cost (undiscounted)
for this activity represents a one-time
Federal consultant cost of $1 million in
the second year of WIOA.
Costs
At the Federal level for the AEFLA
program (see Exhibit 14), the
Departments estimated the cost related
to providing technical assistance to
States to comply with the new WIOA
performance accountability
requirements, including the collection
and reporting of new data as a one-time
consultant cost ($ 1, 000,000) in the
second year of the rule. Over the 10 -year
period, this calculation yields an
average annual cost of $100, 000.
vii. Performance Reports
Under WIOA sec. 116( d)( 6), States
must make available ( including by
electronic means) performance reports
for local areas and for ETPs under title
I of WIOA. WIA required DOL to make
State performance reports publicly
available but did not require States,
themselves, to make their performance
reports available (see WIA sec.
136( d)( 3)). Section 116( d)( 1) of WIOA
requires the Departments to provide a
performance reporting template to be
used by States, Local WDBs, and ETPs
for the performance reports required in
WIOA secs. 116( d)( 2) through (4). This
Final Rule requires States to submit
quarterly participant and performance
data reports for each of the DOL core
programs. Because DOL has required
quarterly reporting for its programs
prior to WIOA, the frequency of the
reporting requirement should not result
in incremental cost increases for any of
the DOL core programs; rather, the
Federal costs associated with this rule' s
performance reporting requirements
will be associated with the
implementation of the new performance
reporting template. In addition, DOL
State -level costs will be associated with
developing, updating, and submitting
ETP reports because while ETP
reporting was required under WIA,
many States received waivers allowing
them not to make the submissions.
Under WIOA, DOL does not expect to
allow waivers for this reporting
requirement. The State -level AEFLA
programs reported annually under WIA,
while local -level AEFLA programs
reported annually to States under WIA,
and both will continue to do so under
WIOA. AEFLA programs will incur
costs to collect, analyze, and report
performance data. Under WIA, VR
agencies submitted annual performance
data on closed service records through
the RSA -911 Case Service Report, and
under WIOA, they will incur costs to
transition to reporting on open and
closed service records on a quarterly
basis.
The DOL and ED, for purposes of the
DOL core programs and the AEFLA
program, will incur annual Federal level
costs to collect, analyze, and report
performance data. Furthermore, both
Federal agencies will experience annual
costs for software and IT systems. The
Departments do not anticipate an
increase in annual Federal -level costs
for the VR program compared to the
baseline. However, ED will incur a one-
time software and IT systems cost to
support its ability to compile quarterly
data reported by VR agencies into
annual reports required under WIOA. At
the State level for the DOL core
programs, the AEFLA program, and the
VR program, as well as at the local level
for the AEFLA program, there will be
annual costs to collect, analyze, and
report performance data.
Costs
At the Federal level for DOL core
programs ( see Exhibit 35), the
Departments estimated this labor cost by
first multiplying the estimated average
number of GS -14, Step 5 managers ( 1)
by the time required to implement and
review the new performance reporting
template (8 hours) and by the hourly
compensation rate ($ 76. 48/ hour). We
performed the same calculation for GS -
13, Step 5 computer systems analysts ( 1
analyst at $ 64. 71/ hour for 5 hours) and
GS -12, Step 5 management analysts ( 1
analyst at $ 54. 43/ hour for 16 hours). We
summed the labor cost for all three
categories to estimate an annual cost of
1, 806, which results in a total cost of
18, 063 over the 10 -year analysis
period.
The Departments estimated the
annual software and IT systems cost at
the Federal level for the DOL core
programs to be $ 250, 000, which yields
a total cost of $2. 5 million ($2, 500, 000)
over the 10 -year analysis period.
At the State level for the DOL core
programs ( see Exhibit 38), the
Departments estimated this labor cost by
first multiplying the estimated average
number of managers per State ( 1) by the
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time required to develop, update, and
submit ETP reports (8 hours) and by the
hourly compensation rate ($ 65. 39/ hour).
We performed the same calculation for
the following occupational categories:
Computer system analysts ( 1 analyst at
56. 17/ hour for 40 hours), management
analysts ( 1 analyst at $ 45. 88/ hour for 60
hours), and office and administrative
staff members ( 4 staff members at
30. 57/ hour for 20 hours each). We
summed the labor cost for all four
categories ($ 7, 968) and multiplied the
result by the number of States ( 57) to
estimate an annual cost of $454, 194,
which results in a total cost of $4. 5
million ($4, 541, 942) over the 10 -year
analysis period.
At the Federal level for the AEFLA
program (see Exhibit 36), the
Departments estimated this labor cost by
first multiplying the estimated number
of GS -14, Step 5 managers ( 1) by the
time required to collect, analyze, and
report performance data ( 8 hours) and
by the hourly compensation rate
76.48/ hour). We repeated the
calculation for GS -13, Step 5 social and
community service managers ( 1
manager at $ 64. 71/ hour for 16 hours)
and GS -13, Step 5 database
administrators (1 administrator at
64. 71/ hour for 40 hours). We summed
the labor cost for all three categories to
estimate an annual cost of $4, 236. Over
the 10 -year period, this calculation
yields a total cost of $42, 356.
The Departments estimated a one-
time software and IT systems cost at the
Federal level for the AEFLA program to
be $ 5 million for development,
modernization, and enhancement. Over
the 10 -year period, this calculation
yields an average annual cost of
500,000.
The Departments also estimated the
annual software and IT systems cost for
the AEFLA program at the Federal level
to be $ 250, 000 to maintain the steady
state. Over the 10 -year period, this
calculation yields a cost of $2. 5 million
2, 500, 000).
At the State level for the AEFLA
program (see Exhibit 39), the
Departments estimated this labor cost by
first multiplying the estimated average
number of managers per State ( 1) by the
time required to collect, analyze, and
report performance data ( 40 hours) and
by the hourly compensation rate
65. 39/ hour). We repeated the
calculation for the following
occupational categories: Computer
systems analysts ( 1 analyst at $ 56. 17/
hour for 40 hours), social and
community service managers ( 3
managers at $ 54. 21/ hour for 40 hours
each), and database administrators ( 1
administrator at $ 57. 02/ hour for 40
hours). We summed the labor cost for all
four categories ($ 13, 648) and multiplied
the result by the number of States ( 57)
to estimate an annual cost of $777,959.
Over the 10 -year period, this calculation
yields a total cost of $7. 8 million
7, 779, 588). 49
At the local level for the AEFLA
program (see Exhibit 41), the
Departments estimated this cost by first
multiplying the estimated number of
managers per local AEFLA provider (1)
by the time required to collect, analyze,
and report performance data ( 8 hours)
and by the hourly compensation rate
63. 63/ hour). We performed the same
calculation for social and community
service managers ( 1 manager at $ 61. 01/
hour for 8 hours) and database
administrators ( 1 administrator at
59. 60/ hour for 8 hours). We summed
the labor cost for all three occupational
categories ($ 1, 474) and multiplied the
result by the number of local AEFLA
providers (2, 396) to estimate an annual
cost of $3. 5 million ($3, 531, 512). Over
the 10 -year period, this calculation
yields a total cost of $35. 3 million
35, 315, 123).
At the Federal level for the VR
program (see Exhibit 37), the
Departments estimated a one-time
software and IT systems cost to be
68, 925 to support ED' s ability to
compile quarterly data reported by VR
agencies into annual reports required
under WIOA. Over the 10 -year period,
this calculation yields an average
annual cost of $6, 893.
For State VR agencies ( see Exhibit 40),
the Departments estimated this cost by
first multiplying the estimated number
of managers per VR agency ( 1) by the
time required to review and verify the
annual performance report that RSA
will assemble from the quarterly RSA -
911 data that the States have previously
reported ( 5 hours) and by the hourly
compensation rate ($ 65. 39/ hour). We
repeated the calculation for the
following occupational categories:
Computer systems analysts ( 1 analyst at
56. 17/ hour for 5 hours), social and
community service managers ( 2
managers at $ 54. 21/ hour for 10 hours
each), and database administrators ( 1
administrator at $ 57. 02/ hour for 25
hours). We summed the labor cost for all
four categories ($ 3, 118) and multiplied
the result by the number of VR agencies
80) to estimate an annual cost as
249,400, which results in a total 10 -
year cost of $2. 5 million ($2, 494, 000). 5°
49 This provision will be a joint effort between
State and local AEFLA staff.
5° Costs for the Federal RSA program are not
estimated because Federal costs for report
generation will not be in excess of current RSA -911
report costs.
For State VR agencies ( see Exhibit 40),
the Departments estimated this cost by
first multiplying the estimated number
of staff trainers per VR agency ( 1) by the
time required to train staff on new data
collection (6 hours) and by the hourly
compensation rate ($ 54. 21/ hour). We
repeated the calculation for
rehabilitation counselors ( 62 counselors
at $ 36. 66/ hour for 3 hours each). We
summed the labor cost for both
categories ($ 7, 144) and multiplied the
result by the number of VR agencies ( 80)
to estimate a one-time cost of $571, 522,
which results in an average annual cost
of $57, 152.
For State VR agencies ( see Exhibit 40),
the Departments estimated this cost by
first multiplying the estimated number
of rehabilitation counselors ( 62) by the
time required to collect data in the first
year ( 58 hours) and by the hourly
compensation rate ($ 36. 66/ hour). We
summed the labor cost ($ 131, 829) and
multiplied the result by the number of
VR agencies ( 80) to estimate a first year
cost of $10. 5 million ($10, 546, 349). We
then multiplied the estimated number of
rehabilitation counselors ( 62) by the
time required to collect data in the
second and subsequent years ( 15 hours)
and by the hourly compensation rate
36. 66/ hour). We summed the labor
cost ($ 34, 094) and multiplied the result
by the number of VR agencies ( 80) to
estimate an annual cost of $2. 7 million
2, 727, 504). This results in a total 10 -
year cost of $35. 1 million ($35, 093, 885),
which is equivalent to an average
annual cost of $3. 5 million ($3, 509, 388).
The sum of these calculations yields
an average annual cost of $9. 6 million
9, 592, 540) for individuals from the
Federal-and State -level DOL core
programs, the Federal-, State-, and local -
level AEFLA programs, and the Federal -
and State -level VR agencies, that will
incur costs related to the performance
reports. This is equal to a total 10 -year
cost of $95. 9 million ($95, 925, 404).
viii. Obtain UI Wage Data
WIOA core programs will need access
to quarterly State UI wage data to
efficiently identify exited participants
who are employed in the second and
fourth full quarters after exit to report
on the employment performance
indicators. These core programs also
will need access to the State quarterly
UI wage data to identify the individual
quarterly wages in the second full
quarter to calculate the median wage
performance measure. Prior to WIOA,
the AEFLA program obtained quarterly
UI wage data on its participants and
DOL' s public workforce systems had
costs associated with UI wage matches.
This will be the first time, however, that
55973Federal Register / Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
State VR agencies will be required to
obtain and report UI wage data. VR
programs will need to contribute a
reasonable and proportional share of the
costs for maintaining and using the
State UI wage system and interstate
wage information systems, on a per
individual, per query, monthly,
quarterly, or annual basis.
Costs
For State VR agencies (Exhibit 18), the
Departments estimated this cost by first
multiplying the data query cost for large
VR agencies ($ 20, 000) by the number of
large VR agencies ( 10). We then
multiplied the data query cost for
medium VR agencies ($ 8, 000) by the
number of medium VR agencies ( 42).
Finally, we multiplied the data query
cost for small VR agencies ($ 4, 000) by
the number of small VR agencies ( 28).
We summed the annual data query cost
for all VR agencies ($ 648, 000), which
results in a total 10 -year cost of $6. 5
million ($6,480,000). 51
ix. Data Analytic Software and Training
VR agencies also will require data
analytic and reporting software to
extract the information required from
their data collection systems necessary
to match individual cases to the
employment and quarterly earnings data
contained in the UI wage data system.
DOL and AEFLA, which have the
software and perform the analytics, will
experience no incremental costs related
to this activity. This software also will
be required to import the wage and
earnings information to their
information collection and reporting
systems, and complete the calculations
necessary to report on the second
quarter employment and median -age
performance indicators, and on the
fourth-quarter employment indicator.
Costs
For State VR agencies ( see Exhibit 18),
the Departments estimated this cost by
first multiplying the software and IT
systems cost for large VR agencies
25, 000) by the number of large VR
agencies ( 10). We then multiplied the
software and IT systems cost for
medium VR agencies ($ 15, 000) by the
number of medium VR agencies ( 42).
Finally, we multiplied the software and
IT systems cost for small VR agencies
10, 000) by the number of small VR
agencies (28). We summed the one-time
software and IT systems cost for all VR
agencies, resulting in a total one-time
cost of $1. 2 million ($1, 160,000), which
51 Costs for the Federal RSA program are not
estimated because Federal costs for report
generation will not be in excess of current RSA -911
report costs.
is equivalent to an average annual cost
of $116, 000. 52
The sum of the costs for the
Performance Accountability System,
which includes the costs to:
Develop and update State
performance accountability systems
which includes the cost to align
technology and data systems across one-
stop partner programs);
Implement measures for data
collection and reporting on the
effectiveness in serving employers;
Negotiate levels of performance;
Run a statistical adjustment model
to adjust levels of performance;
Obtain data to report on any
additional State performance
accountability indicators beyond
required performance indicators;
Provide technical assistance to
States;
Develop a performance report
template;
Develop, update and submit ETP
reports;
Collect, analyze, and report
performance data; and provide training;
Collect UI wage data; and
Purchase data analytic software and
provide training.
This calculation results in a 10 -year
total cost of $589. 0 million
588, 988, 950), which is equal to an
average annual cost of $58. 9 million
58, 898,895).
d. State Evaluation Responsibilities
WIOA sec. 116( e)( 1) requires States,
in coordination with Local WDBs and
agencies responsible for administering
core programs, to conduct ongoing
evaluations of title I activities carried
out in the State under the core
programs. Such program evaluations
were required under WIA; however,
WIOA specifies that SWAs and other
State agencies must coordinate the
evaluations with the evaluation and
research conducted by the Secretary of
Labor or the Secretary of Education
under the provisions of Federal law
identified in WIOA secs. 169 and
242( c)( 2)( D); secs. 12( a)( 5), 14, and 107
of the Rehabilitation Act of 1973 ( 29
U. S. C. 709( a)( 5), 711, 727) ( applied with
respect to the VR program); and the
investigations provided for by the
Secretary of Labor under sec. 10(b) of
the Wagner-Peyser Act (29 U.S.C.
49i(b)). Additionally, WIOA sec.
116( e)( 4) directs that SWAs and other
State agencies must, to the extent
practicable, cooperate in the evaluations
52 Costs for the Federal RSA program are not
estimated because Federal costs for report
generation will not be in excess of older RSA -911
report costs.
including related research projects)
conducted under the provisions of
Federal law identified in the preceding
sentence. Specifically, such cooperation
must include the provision of data and
responses to surveys, as well as
allowing timely site visits. These
directives regarding coordination within
States as well as coordination with and
cooperation in Federal evaluations were
not present in WIA. Finally, WIOA sec.
116( e)( 3) requires States to prepare and
submit annually to the State and Local
WDBs within a State, and make
available to the public (including by
electronic means), any reports
containing the results of evaluations
conducted by the State under this
section. Under WIA sec. 136( e)( 3),
States were required to prepare and
submit periodically evaluation reports
to the State and Local WDBs within the
State and to DOL as part of their annual
report, but were not required to make
them electronically available to the
public.
Requirements related to Federal
coordination to support State
evaluations will be new to the AEFLA
and VR programs under WIOA;
however, DOL core programs had
evaluation -related requirements under
WIA, as discussed above.
DOL will incur Federal -level costs for
SWA evaluation activities under sec.
116( e) of WIOA. The Federal -level
AEFLA and VR programs will incur
costs for providing technical assistance
and promoting State AEFLA and VR
agency participation, respectively, in
the coordination process (which may
include the design and development of
State evaluation activities). All Federal
programs will incur costs for technical
assistance, monitoring, and
dissemination. Costs will be incurred by
affected entities to coordinate any
evaluations of activities carried out in
the States and in cooperating in the
provision of various forms of data for
Federal evaluations. The Departments
estimate that implementing these
requirements will generate annual labor
costs at the Federal and State level for
DOL and ED programs. In addition,
there will be some marginal software
and IT systems and consultant costs for
State -level DOL programs.
i. Costs
At the Federal level for DOL core
programs ( see Exhibit 42), the
Departments estimated this labor cost by
first multiplying the estimated number
of GS -14, Step 5 managers per State ( 2)
by the time required to support State
evaluation activities (25 hours each) and
by the hourly compensation rate
76.48/ hour). We performed the same
55974 Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
calculation for GS -13, Step 5 computer
system analysts ( 1 analyst at $ 64. 71/
hour for 3 hours) and GS -12, Step 5
management analysts ( 2 analysts at
54. 43/ hour for 30 hours each). We
summed the labor cost for all three
categories ($ 7, 284) to estimate the costs
this entity will incur annually. This is
equivalent to a 10 -year cost of $72, 839.
At the State level for DOL core
programs ( see Exhibit 45), the
Departments estimated this labor cost by
first multiplying the estimated number
of computer systems analysts per State
2) by the time required to coordinate
any evaluations of activities carried out
in the States and to cooperate in the
provision of various forms of data for
Federal evaluations ( 15 hours each) and
by the hourly compensation rate
56. 17/ hour). We performed the same
calculation for the following
occupational categories: Social and
community managers ( 1 manager at
54. 21/ hour for 20 hours), management
analysts ( 1 analyst at $ 45. 88/ hour for 10
hours), and office and administrative
staff members ( 1 staff member at $ 30. 57/
hour for 10 hours). We summed the
labor cost for all four categories ($ 3, 534)
and multiplied the result by the number
of States ( 57) to estimate an annual cost
of $201, 427. This is equivalent to a 10 -
year cost of $2. 0 million ($2, 014, 266).
At the State level for DOL core
programs, the Departments estimated
the software and IT systems costs. We
first multiplied the software and IT
systems cost ($ 10, 000) by the number of
States ( 57) to estimate an annual cost of
570,000. This estimate represents the
cost associated with this Final Rule
beyond the IT expenditures currently
incurred by SWAs. This is equivalent to
a 10 -year cost of $5. 7 million
5, 700, 000).
At the State level for DOL core
programs, the Departments estimated
the consultant costs. We first multiplied
the consultant costs ($ 21, 400) by the
number of States ( 57) to estimate an
annual cost of $1. 2 million ($1, 219,800).
This is equivalent to a 10 -year cost of
12. 2 million ($12, 198,000).
At the Federal level for the AEFLA
program (see Exhibit 43), the
Departments estimated the labor cost by
first multiplying the estimated number
of GS -14, Step 5 managers per State ( 4)
by the time required to support State
adult education agency participation in
the coordination process ( 10 hours each)
and the hourly compensation rate
76.48/ hour). We performed the same
calculation for the following
occupational categories: GS -13, Step 5
computer systems analysts ( 1 analyst at
64. 71/ hour for 5 hours), and GS -12,
Step 5 management analysts ( 2 analysts
at $ 54. 43/ hour for 30 hours each). We
summed the labor cost for all three
categories to estimate an annual cost of
6, 649. This is equivalent to a 10 -year
cost of $66, 486.
At the State level for the AEFLA
program (see Exhibit 46), the
Departments estimated this labor cost by
first multiplying the estimated number
of managers per State ( 1) by the time
required to coordinate any evaluations
of activities carried out in the States and
in cooperating in the provision of
various forms of data for Federal
evaluations ( 10 hours) and by the hourly
compensation rate ($ 65. 39/ hour). We
performed the same calculation for the
following occupational categories:
Computer systems analysts ( 1 analyst at
56. 17/ hour for 20 hours), social and
community managers ( 1 manager at
54. 21/ hour for 10 hours), and
management analysts (1 analyst at
45. 88/ hour for 20 hours). We summed
the labor cost for all four categories
3, 237) and multiplied the result by the
number of States ( 57) to estimate an
annual cost of $184, 509. This is
equivalent to a 10 -year cost of $1. 8
million ($1, 845, 090).
At the Federal level for the VR
program (see Exhibit 44), the
Departments estimated the labor cost by
first multiplying the estimated number
of GS -14, Step 5 managers per State ( 2)
by the time required to support State VR
agency participation and coordination
in carrying out State evaluations ( 5
hours each) and the hourly
compensation rate ($ 76.48/ hour). We
performed the same calculation for the
following occupational categories: GS -
13, Step 5 social and community service
managers ( 2 managers at $ 64. 71/ hour for
10 hours each) and GS - 12, Step 5
management analysts (2 analysts at
54.43/ hour for 15 hours each). We
summed the labor cost for all three
categories to estimate an annual cost of
3, 692. This is equivalent to a 10 -year
cost of $36, 919.
At the State level for the VR program
see Exhibit 47), the Departments
estimated this labor cost by first
multiplying the estimated number of
managers per State ( 1) by the time
required to coordinate any evaluations
of activities carried out in the States and
for cooperating in the provision of
various forms of data for Federal
evaluations ( 1 hour) and by the hourly
compensation rate ($ 65. 39/ hour). We
performed the same calculation for the
following occupational categories:
Computer systems analysts ( 1 analyst at
56. 17/ hour for 13 hours), social and
community service managers ( 1
manager at $ 54. 21/ hour for 5 hours),
management analysts ( 1 analyst at
45. 88/ hour for 5 hours), and office and
administrative support staff (1 staff
member at $ 30. 57/ hour for 2 hours). We
summed the labor cost for all five
categories ($ 1, 357) and multiplied the
result by the number of VR agencies ( 80)
to estimate an annual cost of $108, 575.
This is equivalent to a 10 -year cost of
1. 1 million ($1, 085, 752).
The sum of these calculations yields
a total 10 -year cost of $23. 0 million
23, 019, 352) resulting in an average
annual cost of $2. 3 million ($2, 301, 935),
for individuals from the Federal-and
State -level DOL, AEFLA and VR
programs related to State evaluation
responsibilities.
Relative to the baseline of practice
under WIA, the four provisions of the
WIOA Final Rule described above are
expected to result in costs of $626. 8
million ($626, 780, 605) over the 10 -year
period. This is equivalent to an average
annual cost of $62. 7 million
62, 678, 060). See section V.A. 7
Summary of Analysis) for a summary of
these costs.
7 Summary of Analysis
Exhibit 50 summarizes the estimated
undiscounted average annual costs for
each provision of this Final Rule. The
exhibit also presents a high-level
qualitative description of the benefits
resulting from full WIOA
implementation for each rule provision.
These qualitative forecasts are
predicated on program experience and
are outcomes for which data will
become available only after
implementation. The Departments
estimate the average annual cost of this
Final Rule over the 10 -year period of
analysis to be $ 62. 7 million. The largest
contributor to this cost is the provision
related to the development and
updating of State performance
accountability systems, which is
estimated at $ 42. 7 million per year. The
next largest cost results from
performance reports at an estimated
9. 6 million per year, followed by the
average cost of adjusting performance
based on actual economic conditions
and characteristics of participants at an
estimated $4. 6 million per year.
55975Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
EXHIBIT 50 -ESTIMATED COSTS OF THE DEPARTMENTS OF EDUCATION AND LABOR FINAL RULE BY PROVISION
Average Percent of Provision annual cost Qualitative benefit highlightstotal cost undiscounted)
a) Time to Review the New Rule 330,562 0.53 General requirement.
b)( i) Unified or Combined State Plans -Expanded 120,202 0. 19 Enhanced data for management decision-making and
Content Requirements. policy integration; avoided program service duplica-
tion; enhanced internal State planning; avoids
silos" and service duplications; more efficient use
of public resources.
b)( ii) Unified or Combined State Plans -Biennial De-186,016 0.30
velopment and Modification Process.
b)( iii) Unified or Combined Plans -Coordinating Sub-840,450 1. 34
mission of State Plans.
c)( i) Development and Updating of State Perform-42,717,641 68. 15 Clear articulation of expectations and outcomes for
ance Accountability Systems. accountability purposes; improved policy and man-
agement decision-making from performance meas-
ure data; better management and policy decisions
using outcome data; improved service and place-
ments; more accountability.
1. 02%
638,350 1. 02
c)( iii) Negotiation of Levels of Performance 490,432 0.78
c)( iv) Running Statistical Adjustment Model to Adjust
c)( ii) Effectiveness of Serving Employers
4,578,901 7.31
Levels of Performance Based on Actual Economic
Conditions and Characteristics of Participants.
c)(v) Additional State Performance Accountability In-17,032 0.03
dicators ( Beyond Required Performance Indicators)
c)(vi) Technical Assistance to States 100,000 0. 16
c)( vii) Performance Reports, including collection
new data.
c)( viii) Obtain UI Wage Data
c)( ix) Data Analytic Software and Training
d) State Evaluation Responsibilities
of 9,592,540
648,000
116, 000
2,301, 935
15. 30
1. 03
0. 19
3. 67 Improved
hanced
account
service deliver
policy-making
ability.
y and
and
customer service;
system building; m
en-
ore
Total Costs 62, 678,060 100. 00
Note: Totals might not sum due to rounding.
Exhibit 51 summarizes the first-year contributor to the first-year cost is the from performance reports, amounting to
costs for each provision of this Final provision related to developing and 21. 7 million, followed by adjusting
Rule. The Departments estimated the updating State performance levels of performance based on actual
total first-year cost of this Final Rule to economic conditions and characteristicsaccountability systems at $ 97. 5 million.
be $ 135. 5 million. The largest The next largest first-year cost results at $ 4. 6 million.
EXHIBIT 51 -ESTIMATED FIRST-YEAR COSTS OF THE FINAL RULE BY PROVISION
Percent ofTotal first-yearProvision total first-year
cost cost
a) Time to Review the New Rule 3,305,615 2.44
b)( i) Unified or Combined State Plans -Expanded Content Requirements 1, 202,022 0.89
b)( ii) Unified or Combined State Plans - Biennial Development and Modification Process 0 0.00
b)( iii) Unified or Combined Plans -Coordinating Submission of State Plans 1, 680,901 1. 24
97,467,521 71. 91c)( i) Development and Updating of State Performance Accountability Systems
c)( ii) Effectiveness of Serving Employers 338,045 0.25
c)( iii) Negotiation of Levels of Performance 980,863 0.72
c)( iv) Running Statistical Adjustment to Adjust Levels of Performance Based on Actual Economic Conditions
and Characteristics of Participants 4,578,901 3.38
c)(v) Additional State Performance Accountability Indicators (Beyond Required Performance Indicators) 170,317 0. 13
c)(vi) Technical Assistance to States 0 0.00
c)( vii) Performance Reports, including collection of new data 21, 705,903 16.01
c)(viii) Obtain UI Wage Data 648,000 0.48
1, 160,000 0.86c)( ix) Data Analytic Software and Training
d) State Evaluation Responsibilities 2,301, 935 1. 70
Total Cost 135,540,023 100.00
Note: Totals might not sum due to rounding.
55976 Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
Exhibit 52 summarizes the estimated
annual and total costs of this Final Rule.
The estimated total (undiscounted) cost
of the rule sums to $ 626. 8 million over
the 10 -year analysis period, which is
equal to an average annual cost of $62. 7
million per year. In total, the estimated
10 -year discounted costs of the Final
Rule range from $495. 2 million to
558. 9 million (with 7-and 3 -percent
discounting, respectively).
To contextualize the cost of this Final
Rule, the average annual budget for WIA
implementation over FY 2012- 2014 for
the Departments of Labor and Education
combined was $ 7. 2 billion.53 Thus, the
annual additional cost of implementing
this Final Rule is 0. 9 to 1 percent of the
average annual WIA budget for FY
2012-2014 (with 3 -percent and 7 -
percent discounting, respectively). In
response to public comments, the
Departments also contextualize the cost
of the Final Rule relative to the amount
of administrative and transition funds
available to States, which averaged
200. 1 million between PY 2014 and PY
2015. 54 The annual additional cost of
implementing the Final Rule is between
32. 7 percent and 35. 2 percent of the
average annual administrative and
transition funds budget (with 3 -percent
53 U.S. Department of Labor, Employment and
Training Administration. (2015). Archive of State
Statutory Formula Funding. Retrieved from: https://
www.doleta.gov/budget/pyal_py09 arra_
archive.cfm. The Departments used data from the
following files to estimate the average annual WIA
budget: WIA Adult Activities Program (PYs 2011,
2012, 2013, and 2014); WIA Dislocated Worker
Activities Program (PYs 2011, 2012, 2013, and
2014); and WIA Youth Activities (PYs 2012, 2013,
and 2014). Note that for adult and dislocated
worker activities, the Departments summed the
program year's July funding with the previous
program year' s October funding to calculate the
amount of funding per fiscal year. The youth
activities funding is obligated to States in April and
therefore corresponds to the fiscal year in which it
is obligated. We inflated the funding for each fiscal
year, so that the average annual WIA budget is in
2015 dollars.
U.S. Department of Labor, Employment and
Training Administration. (2015) State Statutory
Formula Funding. Retrieved from: https://
www.doleta.gov/budget/statfund.cfm. The
Departments also used data from the following files
to estimate the average annual WIA budget:
Employment Services Program Dollar Tables ( PYs
2012, 2013, and 2014). Note that Wagner-Peyser Act
funds for a program year are obligated to States in
July; therefore, these funds correspond to the fiscal
year in which they are obligated. We inflated the
funding for each fiscal year, so that the average
annual WIA budget is in 2015 dollars.
U.S. Department of Education. (2016).
Department of Education Budget Tables. Retrieved
from: http:// www2.ed.gov/about/ overview/ budget/
tables.html?src= ct. The Departments used data from
the following files to estimate the average annual
WIA budget: Congressional Action (FYs 2012, 2013,
and 2014). The budget was updated to 2015 dollars.
54 Training and Employment Guidance Letter
TEGL) 34-14, TEGL 12- 14, TEGL 24-14. The
Departments inflated the funding for each program
year.
and 7 -percent discounting,
respectively).
EXHIBIT 52— ESTIMATED MONETIZED
COSTS OF DEPARTMENTS OF LABOR
AND EDUCATION FINAL RULE
2015 dollars]
2016 135,540,023
2017 77,389,018
2018 64,038,222
2019 52,945, 116
2020 59,249,908
2021 45,312,669
2022 50,789,374
2023 45,312,669
2024 50,890,937
2025 45,312,669
Undiscounted 10 -Year Total 626,780,605
10 -Year Total with 3% Dis-
558, 940,877
10 -Year Total with 7% Dis-
counting
495, 158, 156
10 -Year Average 62,678,060
Annualized with 3% Dis-
counting
counting
65,524,922
Annualized with 7% Dis-
counting 70,499,382
Note: Totals might not sum due to rounding.
Regulatory Benefits
The Departments were unable to
quantify several important benefits to
society due to data limitations and a
lack of existing data or evaluation
findings on particular items. 55 These
include increased employment
opportunities for unemployed or
underemployed U.S. workers, enhanced
ETP process, and evaluation of State
programs. Below, we describe
qualitatively the benefits related to this
Final Rule.
The Departments provide a qualitative
description of the anticipated WIOA
benefits below. The anticipated WIOA
benefits are the results of expanded
services to a larger number of people
and/ or improving services that are
already being offered under WIA. These
qualitative forecasts are predicated on
program experience and are outcomes
for which data will become available
only after implementation. The studies
discussed below are largely based on
programs and their existing
requirements under WIA and therefore
they capture the benefits associated
55 The Departments were able to estimate many
but not all of the inputs that would be necessary
to quantify a benefit to DOL programs that could
result from this Final Rule if affected entities
choose to integrate DOL program participant
records. This activity is highly encouraged but not
required by this Final Rule; hence, one of the key
inputs to the benefits calculation (the number of
entities choosing to integrate) is highly uncertain.
Given the inability to reliably estimate this input,
no quantitative estimate of cost savings is
presented; instead these ancillary benefits are
discussed at the end of this benefits section.
with WIA. However, they still can
illustrate the types of benefits that are
expected from this Final Rule.
Increased alignment of training with
local labor markets through economic,
education, and workforce data. Under
WIOA, more substantial economic,
education, and workforce data are
required to be integrated into the State
Plan than was required under WIA for
ED programs. Under WIA, economic,
education, and workforce data were not
included in State Plans for ED
programs. 56 Hence, it was possible that
some program participants were being
trained for jobs with no local demand at
the time of the participants' exit from
the training program, even though the
demand for the job might have existed
elsewhere. Under WIOA, economic,
education, and workforce data will be
shared by DOL and ED via the core
programs in the State Plan. Relative to
WIA, the use of economic, education,
and workforce data are expected to
result in training that is better aligned
with local labor market demand (i.e., the
likelihood that more participants are
learning skills that are applicable to jobs
for which there will be local demand is
increased).
This is expected to result in three
potential benefits: (1) Improved
employment outcomes in the local area,
2) higher wages, and (3) reduced costs
associated with returning training
participants. First, because training
participants will primarily be trained for
jobs with local demand, these
individuals will have an increased
likelihood of obtaining employment
following their training due to their
applicable skill set and the increased
availability of local labor market
positions. This could minimize the
duration of unemployment in some
local areas. Second, these individuals
could be paid a higher wage because
they will possess job -specific training
for jobs in demand in the local area.
Finally, under WIA, if an individual
was not employed after exiting a
training program, he or she was able to
participate in some additional training
programs, which resulted in greater
costs for those training providers and
one-stop partners. Under WIOA, the
Departments expect costs for returning
participants could decrease due to some
participants' increased likelihood of
obtaining employment. Overall, having
better aligned training programs will
have a positive effect on the economy
from benefits such as reduced retraining
56 DOL already included economic, education,
and workforce data in the State Plans under WIA,
so DOL programs will not experience as much in
incremental costs associated with this particular
requirement as will the AEFLA and VR programs.
55977Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
costs, and improved worker morale. The
lengthy and involved process of
implementing changes to existing
programs and developing new
programs, however, might delay the
benefits derived from improved
economic, education, and workforce
data. 57
State evaluation research. In support
of a State' s strategic plan and goals,
State -conducted evaluations and other
forms of research will enable each State
to test various interventions geared
toward State conditions and
opportunities. Results from such
evaluation and research, if used by
States, could improve service quality
and effectiveness, potentially leading to
higher employment rates and earnings
among participants. Implementing
various innovations that have been
tested and found effective also could
lead to lower unit costs and increased
numbers of individuals served within a
State. Sharing the findings nationally
could lead to new service or
management practices that other States
could adopt to improve participant
labor market outcomes, lower unit costs,
or increase the number served.
Training's impact on job placement.
A recent study found that flexible and
innovative training that is closely
related to a real and in -demand
occupation is associated with better
labor market outcomes for training
participants. Youth disconnected from
work and school can benefit from
comprehensive and integrated models of
training that combine education,
occupational skills, and support
services. 58 The study noted, however,
that evidence for effective employment
and training -related programs for youth
is less extensive than for adults, and
that there are fewer positive findings
from evaluations.59 The WIA youth
program remains largely untested.6o
One study found that WIA training
services increase placement rates by 4. 4
percent among adults and by 5. 9 percent
57 Johnson, T., Gritz, M., Jackson, R., Burghardt,
J., Boussy, C., Leonard, J., and Orians, C. ( 1999).
National Job Corps Study: Report on the process
analysis. Prepared by Mathematica Policy Research,
Inc. for U. S. Department of Labor, Employment and
Training Administration. Retrieved from: http://
wdr.doleta.gov/research/FullText Documents/99-
jcanalysis.pdf.
58 U.S. Department of Labor, U.S. Department of
Commerce, U.S. Department of Education, and U.S.
Department of Health and Human Services. ( 2014).
What works in job training: A synthesis of the
evidence. Retrieved from: http:// www.dol.gov/asp/
evaluation/jdt/jdt.pdf.
59Ibid.
66 Decker, P. T., & Berk. J. A. (2011). Ten years of
the Workforce Investment Act (WIA): Interpreting
the research on WIA and related programs. Journal
of Policy Analysis and Management, 30(4), 906-
926.
among dislocated workers, 61 while
another study concluded that placement
rates are 3 to 5 percent higher among all
training recipients.62
Participants in occupational training
had a reemployment rate 5 percentage
points higher than those who received
no training, and reemployment rates
were highest among recipients of on-
the-job training, a difference of 10 to 11
percentage points.63 The study found
that training, however, did not
correspond to higher employment
retention or earnings.64 A Youth
Opportunity Grant Initiative study
found that Youth Opportunity was
successful at improving outcomes for
high -poverty youth. Youth Opportunity
also increased the labor -force
participation rate overall and for
subgroups, including 16-to 19 -year-old
adolescents, women, African
Americans, and in -school youth.65 DOL -
sponsored research found that
participants who received core services
often funded by Employment Services)
and other services in American Job
Centers were more likely to enter and
retain employment.66
Training's impact on wages. Before
enactment of WIA, Job Training
Partnership Act services had a modest
81Hollenbeck, K., Schroeder, D., King, C. T., and
Huang, W.J. ( 2005). Net impact estimates for
services provided through the Workforce Investment
Act (Occasional Paper 2005-06). Washington, DC:
U.S. Department of Labor, Employment and
Training Administration, Office of Policy and
Research, Division of Research and Demonstration.
Retrieved from: http:// wdr.doleta.gov/research/Full
Text Documents/Net%20lmpact%20Estimates% 20
for°%20Services %20Provided %20through %20the
20Workforc e % 20Investment %20Act-
20Final %20Report.p df.
82Heinrich, C.J., Mueser, P.R., and Troske, K.R.
2009). Workforce Investment Act non -experimental
net impact evaluation. Columbia, MD: IMPAQ
International, LLC. Retrieved from: http://
wdr.doleta.gov/research/FullText Documents/
Workforce %20lnvestment %20Act %20Non-
Experimental %20Net %20Impact %20Evalnation
20-% 20Final %20Report.pdf.
63Park, J. ( 2011). Does occupational training by
the Trade Adjustment Assistance Program really
help reemployment?: Success measured as
matching. Washington, DC: U.S. Department of
Labor, Employment and Training Administration.
Retrieved from: https:// wdr.doleta.gov/research/
Full TextDocuments/ ETAOP 2011-09.pdf.
64Ibid.
85 Jackson, R.H., Malene Dixon, R., McCoy, A.,
Pistorino, C., Zador, P., Lopdell, J., . . . and Bruno.,
L. ( 2007). Youth Opportunity Grant Initiative:
Impact and synthesis report. Prepared by Decision
Information Resources, Inc. for U. S. Department of
Labor, Employment and Training Administration.
Retrieved from: http:// wdr.doleta.gov/research/
FullTextDocuments/ YO %20Impact %20and
20Synthesis% 20Report.pdf.
66 U. S. Department of Labor, Employment and
Training Administration, Office of Policy
Development and Research. ( 2013). Five -Year
research and evaluation strategic plan program
years 2012- 2017. Retrieved from: http://
wdr.doleta.gov/research/ FullText Documents/
ETAOP201321. pdf.
but statistically significant impact on
the earnings of adult participants.67
WIA training increased participants'
quarterly earnings by $660; these
impacts persisted beyond 2 years and
were largest among women.68 WIA adult
program participants who received core
services ( e.g., skill assessment, labor
market information) or intensive
services ( e.g., specialized assessments,
counseling) earned up to $ 200 more per
quarter than non-WIA participants.
Participants who received training
services in addition to core and
intensive services initially earned less
but caught up within 10 quarters with
the earnings of participants who
received only core or intensive services;
marginal benefits of training could
exceed $ 400 per quarter. Earnings
progressions were similar for WIA adult
program participants and users of the
labor exchange only.69 WIA training
services also improved participants'
long-term wage rates, doubling earnings
after 10 quarters over those not
receiving training services. 70 WIA
participants who did not receive
training, however, earned $ 550 to $ 700
more in the first quarter after placement.
The study also noted that individuals
who did not receive training received
effective short-term counseling that
enabled them to gain an immediate
advantage in the labor market. 71
Another DOL program, the Job Corps
program for disadvantaged youth and
young adults, produced sustained
increases in earnings for participants in
their early twenties. Students who
completed Job Corps vocational training
experienced average earnings increases
by the fourth follow-up year over the
comparison group, whereas those who
87 Barrow, B., and Gubits, D. ( 2003) Review of
recent pilot, demonstration, research, and
evaluation initiatives to assist in the
implementation ofprograms under the Workforce
Investment Act (Occasional Paper 2003-10). U.S.
Department of Labor, Employment and Training
Administration. Retrieved from: http://
wdr.doleta.gov/research/ FullText Documents/
ETAOP%202003-10 %20Review°%20of %20
Recent%20Pilot %2C%20Demonostra tion
2C% 20Research %2C% 20an d %20
Evaluation %20lnitiatives.p df.
68 Ibid.
69 Chrisinger, C. K. ( 2011). Earnings progression
among workforce development participants:
Evidence from Washington State. U.S. Department
of Labor, Employment and Training
Administration. Retrieved from: http://
wdr.doleta.gov/research/ FullText Documents/
ETAOP 2011-11. pdf.
70 Heinrich, C.J., Mueser, P.R., and Troske, K.R.
2009). Workforce Investment Act non -experimental
net impact evaluation. Columbia, MD: IMPAQ
International, LLC. Retrieved from: http://
wdr.doleta.gov/research/FullText Documents/
Workforce %20lnvestment %20Act %20Non-
Experimental %20Net %20Impact %20Evalnation
20- %20Final %20Report.pdf.
71Ibid.
55978 Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
did not complete training experienced
no increase. 72 Another publication
noted that on average, adults
experienced a $ 743 quarterly post -exit
earnings boost.73
Those who completed training
experienced a 15 percent increase in
employment rates and an increase in
hourly wages of $1. 21 relative to
participants without training.74
Participation in WIA training also had a
distinct positive but smaller impact on
employment and earnings, with
employment 4. 4 percentage points
higher and quarterly earnings $660
higher than comparison group members.
National and international studies
such as the recent Survey of Adult
Skills 75 provide strong evidence of the
need for and economic value of adult
basic skills (ABS). A growing body of
research indicates strong economic
return on basic skills at given levels of
education. Estimates have been made of
the potential economic benefits that
would accrue from increased
educational attainment and levels of
basic skills. The Longitudinal Study of
Adult Learning 76 ( LSAL) randomly
sampled approximately 1, 000 high
school dropouts and followed them for
nearly a decade from 1998 to 2007.
LSAL followed both participants and
nonparticipants in ABS programs,
assessing their literacy skills and skill
uses over long periods, along with
changes in their social, educational, and
economic status, offering a rich picture
72 Gritz, M., and Johnson, T. ( 2001). National Job
Corps Study: Assessing program effects on earnings
for students achieving key program milestones.
Prepared by Battelle Memorial Institute for U.S.
Department of Labor, Employment and Training
Administration, Office of Policy and Research.
Retrieved from: http:// wdr.doleta.gov/research/
FullText Documents/MilestonelmpactReport-
Final.pdf.
73 Hollenbeck, K., Schroeder, D., King, C. T., and
Huang, W.J. ( 2005). Net impact estimates for
services provided through the Workforce Investment
Act (Occasional Paper 2005-06). Washington, DC:
U.S. Department of Labor. Retrieved from: http://
wdr.doleta.gov/research/FullText Documents/
Net %20Impact %20Estima tes %20for%20Services
20Pro vided %20through %20the % 20
Workforce %20lnvestment %20Act- %20Final %20
Report.pdf.
74 Needels, K., Bellotti, J., Dadgar, M., and
Nicholson, W. ( 2006). Evaluation of the Military
Base National Emergency Grants: Final report
Occasional Paper 2007-02). Prepared by
Mathematica Policy Research for U. S. Department
of Labor, Employment and Training
Administration, Office of Policy Development and
Research. Retrieved from: https:// wdr.doleta.gov/
research/ FullTextDocuments/Evaluation %20of
20th e % 20Military%20Base %20National %20
Emergency%20Grants %20Final %20Report.p df.
75 OECD. About the Survey of Adult Skills
PIAAC). Retrieved from: https:// www.oecd.org/site/
piaac/ surveyofadultskills.htm.
75 Portland State University. (2010). Introduction
to LSAL. Retrieved from: http:// www.lsal.pdx.edu/
index.html.
of adult literacy development. The
study found that individuals who
participate in ABS programs have
higher future earnings, and income
premiums are larger with more
intensive participation. 77 Individuals
who participate in ABS programs tend
to have higher levels of future literacy
proficiency. Their proficiency
premiums are larger with more
intensive participation. 78 The study also
found a robust impact of ABS program
participation on secondary school
credential attainment 79 and engagement
in postsecondary education. 80
Vocational and adult literacy's
education impact. Vocational managers
indicate that closely aligning service
offerings with labor market reports
improves the likelihood that
participants will learn applicable skills.
The lengthy and involved process of
implementing changes to existing
programs and developing new
programs, however, might delay the
benefits derived from improved labor
market data.81
The following are channels through
which the benefits discussed above
might be achieved:
Better information for workers. The
performance accountability measures
will provide workers with higher -
quality information about potential
training program providers and enable
them to make better -informed choices
about which programs to pursue. The
information analyzed and published by
the WDBs about local labor markets also
will help trainees and providers target
their efforts and develop reasonable
expectations about outcomes.
77 U. S. Department of Education, Office of Career,
Technical, and Adult Education. The Impact of ABS
Program Participation on Long -Perm Economic
Outcomes. Washington, DC, 2014. Retrieved from:
http:// lincs.ed.gov/employer/ 1 ABS Economic
Outcomes.pdf.
78 U. S. Department of Education, Office of Career,
Technical, and Adult Education. The Impact of ABS
Program Participation on Long -Term Literacy
Growth. Washington, DC, 2014. Retrieved from:
http:// lincs.ed.gov/employer/2ABS Literacy
Growth.pdf.
79 U. S. Department of Education, Office of Career,
Technical, and Adult Education. The Impact of ABS
Program Participation on Long -Term GED
Attainment. Washington, DC, 2014. Retrieved from:
http:// lincs.ed.gov/employer/3 ABS GED
Attainment.p df.
80 U. S. Department of Education, Office of Career,
Technical, and Adult Education. The Impact of ABS
Program Participation on Long -Term Postsecondary
Engagement. Washington, DC, 2014. Retrieved
from: http:// lincs.ed.gov/employer/4ABSPost
secondary Engagement.pdf.
81 Johnson, T., Gritz, M., Jackson, R., Burghardt,
J., Boussy, C., Leonard, J. and Orians, C. ( 1999).
National Job Corps study: Report on the process
analysis. Prepared by Mathematica Policy Research,
Inc. for U.S. Department of Labor, Employment and
Training Administration. Retrieved from: http://
wdr.doleta.gov/research/FullText Documents/ 99-
jcanalysis.p df.
Consumers of educational services,
including those with barriers to
employment, such as disadvantaged and
displaced workers, require reliable
information on the value of different
training options to make informed
choices. Displaced workers tend to be
farther removed from schooling and lack
information about available courses and
the fields with the highest economic
return.82 Given these information gaps
and financial pressures, it is important
that displaced workers learn of the
economic returns to various training
plans.83 Still, one study concluded that
the cost-effectiveness of WIA job
training for disadvantaged workers is
modestly positive" due to the limited
sample of States on which the research
was based. 84
State performance accountability
measures. This requirement will
include significant data collection for
Local WDBs to address performance
measures for the core programs in their
jurisdictions. This data collection will
permit the State WDBs to assess
performance across each State. Training
providers will be required to provide
data to Local WDBs, which will
represent a cost in the form of increased
data collection and processing.
Employers and employees also will
have to provide information to the
training providers, which will take time.
This provision—in combination with
the Board membership provision
requiring employer/ business
representation that is part of the DOL
WIOA Final Rule— is expected to
improve the quality of local training
and, ultimately, the number and caliber
of job placements.
Implementation of follow-up
measures, rather than termination -based
measures, might improve long-term
labor market outcomes, although some
82 Greenstone, M., and Looney, A. (2011).
Building America' s job skills with effective
workforce programs: A training strategy to raise
wages and increase work opportunities.
Washington, DC: The Hamilton Project. Retrieved
from: http:// www.brookings. edu/-/ media/ research/
files/papers/2011 /11 /training-greenstone-looney/
11 training greenstonelooney.pdf.
83 Jacobson, L. S., Lalonde, R.J., and Sullivan, D.
2011). Policies to reduce high tenured displaced
workers' earnings losses through retraining
Discussion Paper 2011-11). Washington, DC: The
Hamilton Project. Retrieved from: http://
www.brookings.edu/-/ media/ research/files/papers/
2011/ 11/ displaced-jacobson-lalaonde-Sullivan/ 11_
displacedjls_paper.pdf.
84 Heinrich, C. J., Mueser, P.R., Troske, K.R., Jeon,
K. S., and Kahvecioglu, D. C. ( 2009). New estimates
of public employment and training program net
impacts: A nonexperimental evaluation of the
Workforce Investment Act program (Discussion
Paper 4569). Bonn, Germany: Institute for the Study
of Labor (IZA). Retrieved from: http://ftp.iza.org/
dp4569.pdf.
55979Federal Register / Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
could divert resources from training
activities. 85
Before -after earning metrics capture
the contribution of training to earnings
potential and minimize incentives to
select only training participants with
high initial earnings. 86 With the
exception of programs in a few States,
current incentives do not reward
enrollment of the least advantaged.87 In
addition, the study noted evidence that
the performance -standards can be
gamed" in an attempt to maximize
centers' measured performance. 88
Pressure to meet performance levels
could lead providers to focus on offering
services to participants most likely to
succeed. For example, current
performance accountability measures
might create incentives for training
providers to screen participants for
motivation, delay participation for those
needing significant improvement, or
discourage participation by those with
high existing wages. 89
The following subsections present
additional channels by which economic
benefits may be associated with various
aspects of this Final Rule:
Dislocated workers. A study found
that, for dislocated workers, receiving
WIA services significantly increased
employment rates by 13. 5 percent and
boosted post -exit quarterly earnings by
951. 90 Another study, however, found
that training in the WIA dislocated
worker program had a net benefit close
to zero or even below zero. 91
85 Courty, P., and Marschke, G. ( 2007). Making
government accountable: Lessons from a federal job
training program. Public Administration Review,
67(5), 904-916.
86Heckman, J.J., Heinrich, C., and Smith, J.A.
1997). Assessing the performance of performance
standards in public bureaucracies. American
Economic Review, 87(2), 389-395.
87 Ibid.
88 Ibid.
89 Dunham, K., Mack, M., Salzman, J., and
Wiegand, A. (2005). Evaluation of the WIA
performance measurement system: Survey report.
Prepared by Social Policy Research Associates for
U.S. Department of Labor, Employment and
Training Administration. Retrieved from: http://
wdr.doleta.gov/research/ FullText Documents/
Evaluation %20of %20th e % 20WIA% 20Performance
20Measurement %20System %20- %20Survey% 20
Report.pdf.
90 Hollenbeck K., Schroeder, D., King, C. T., and
Huang, W. -J. ( 2005). Net impact estimates for
services provided through the Workforce Investment
Act (Occasional Paper 2005-06). Washington, DC:
U.S. Department of Labor, Employment and
Training Administration, Office of Policy and
Research, Division of Research and Demonstration.
Retrieved from: http:// wdr.doleta.gov/research/
FullText Documents/Net%20lmpact%20Estimates
20for°%20Services %20Provided %20through
20th e % 20Workforce %20lnvestment%20Act-
20Final %20Report.pdf.
91 Heinrich, C.J., Mueser, P.R., and Troske, K.R.
2009). Workforce Investment Act non -experimental
net impact evaluation. Columbia, MD: IMPAQ
International, LLC. Retrieved from: http://
Self-employed individuals. Job
seekers who received self-employment
services started businesses sooner and
had longer lasting businesses than
nonparticipants. Self-employment
assistance participants were 19 times
more likely to be self-employed than
nonparticipants and expressed high
levels of satisfaction with self-
employment. A study of Maine, New
Jersey, and New York programs found
that participants were four times more
likely to obtain employment of any kind
than nonparticipants.92
Workers with disabilities. A study of
individuals with disabilities enrolled in
training for a broad array of occupations
found that the mean hourly wage and
hours worked per quarter for program
graduates were higher than for
individuals who did not complete the
program.
In conclusion, after a review of the
quantitative and qualitative analysis of
the impacts of this Final Rule, the
Departments have concluded that the
societal benefits justify the anticipated
costs.
Ancillary Benefits
The following section describes the
ancillary benefit to the DOL program
that may result from this Final Rule due
to integrated DOL program participant
records— an activity that is highly
encouraged in the Final Rule, but is not
required.
Integrated DOL Program Participant
Records. Section 504 of WIOA requires
State and Local WDBs to establish
procedures and criteria that will
simplify reporting requirements and
reduce reporting burdens. Under WIOA,
States will be highly encouraged to
submit one record for an individual
participating in one or more DOL title
I and Wagner-Peyser Act Employment
Service core programs. The individual
records would be standardized in terms
of data elements and associated
reporting specifications. Under WIA, for
the DOL core programs, States were
required to provide two separate
individual records for an individual
receiving services under the DOL title I
programs and the Wagner-Peyser Act
Employment Service program. A single
integrated individual record for DOL
wdr.doleta.gov/research/FullText Documents/
Workforce %20lnvestment% 20Act %20Non-
Experimental %20Net%20lmpact%20Evaluation
20-% 20Final %20Report.pdf.
92 Kosanovich, W., Fleck, H., Yost, B., Armon, W.,
and Siliezar, S. ( 2001). Comprehensive assessment
of self-employment assistance programs. Prepared
by DTI Associates for U. S. Department of Labor,
Office of Workforce Security. Retrieved from: http://
wdr.doleta.gov/research/ FullText Documents/
Comprehensive %20Assessment °%20of %20Self -
Employment %20Assistance %20Programs. p df.
core programs would eliminate
duplicative reporting of an individual' s
demographic information across
programs.
According to a recent report which
sampled 28 local areas, career
counselors reported that their high
caseloads ( approximately 50 to 100
cases per counselor) limited the amount
of time they could spend providing
individualized career services
individualized career services under
WIOA) per client.93 Efficiencies in the
intake process will allow case managers
to spend more time per client delivering
intensive services. The study also found
that intensive services led to increased
employment and earnings, and
individuals that received intensive
services were more likely to have stable
jobs with more benefits. 94 In addition to
the technical benefits of integrated
systems, this process will reduce
administrative burdens in service
delivery that existed under WIA. WIOA
removes a sequence of service
requirement that in some cases may
have prolonged or created barriers to
effective service delivery. Under WIOA,
career planners can deliver the needed
services without going through these
administrative processes. By doing so,
individuals will get the services they
need sooner which can lead to quicker
entry into employment or training.
Furthermore, having integrated records
will help the programs find the best mix
of services for individuals, which can
result in UI payment reductions,
improved job placement rates, higher
paying jobs, and reduced government
assistance. Although there will be some
upfront costs to develop the system ( as
discussed in provision (c) " State
Performance Accountability System"),
the Departments expect long-term
benefits.
Transfers
In addition, there are two important
transfers that the Departments were
unable to quantify. Below, we describe
qualitatively the transfers that are
expected to result from improved
system alignment and the
Reemployment and Eligibility
Assessment Program.
Improved system alignment. Under
WIOA, State WDBs must help
Governors develop strategies for
93D' Amico, R. et al. (2015). Providing public
workforce services to job seekers: Implementation
findings on the WIA Adult and Dislocated Worker
Programs. Washington, DC: Mathematic Policy
Research.
94 McConnell, S. et al. (2016). Providing public
workforce services to job seekers: 15 -Month impact
findings on the WIA Adult and Dislocated Worker
Programs. Washington, DC: Mathematica Policy
Research.
55980 Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
aligning technology and data systems
across one-stop partner programs to
enhance service delivery and improve
efficiencies in reporting on performance
accountability measures. Improved
system alignment will allow States to
better understand and address State -
level problems. Integrated data systems
will allow for unified and streamlined
intake, case management, and service
delivery; minimize the duplication of
data; ensure consistently defined and
applied data elements; facilitate
compliance with performance reporting
and evaluation requirements; and
provide meaningful information about
core program participation to inform
operations. For example, participants in
a title I job training program, who need
to improve their basic literacy skills,
will be able to access the title II adult
education services they need in one
location which will help to facilitate
concurrent service delivery by the one-
stop core partner programs and
ultimately accelerate overall timeliness
for outcome attainment. With this
improved information, States will have
the ability to negotiate levels of
performance more accurately, which
will subsequently reduce the likelihood
that States will receive sanctions for
failing to meet the State -adjusted levels
of performance for a program for a
second consecutive program year or for
failing to submit a report for any
program year.
The Reemployment and Eligibility
Assessment program. The
Reemployment and Eligibility
Assessment program, which has now
evolved to become the Reemployment
Service and Eligibility Assessment
program, was effective in assisting
claimants to exit the UI program and
avoid exhausting regular UI benefits in
Florida, Idaho, and Nevada. By avoiding
UI benefit exhaustion, the program led
to reductions in the likelihood of
receiving unemployment compensation
benefits. There exists notable evidence
that the Reemployment and Eligibility
Assessment program is cost-effective,
particularly when provided through an
integrated service delivery model,
which WIOA also promotes. 95 The
program reduced UI payments and
increased tax revenue resulting from
increased worker earnings.
95 Poe-Yamagata, E., Benus, J., Bill, N., Carrington,
H., Michaelides, M., and Shen, T. ( 2011). Impact of
the Reemployment and Eligibility Assessment (REA)
Initiative. Columbia, MD: IMPAQ International,
LLC. Retrieved from: http:// wdr.doleta.gov/
research/ FullText Documents/ ETAOP 2012 08
Impact of the REA Initiative.pdf.
B. Regulatory Flexibility Act
The Regulatory Flexibility Act (RFA),
5 U.S. C. 603, requires agencies to
prepare a regulatory flexibility analysis
to determine whether a regulation will
have a significant economic impact on
a substantial number of small entities.
Section 605 of the RFA allows an
agency to certify a rule in lieu of
preparing an analysis if the regulation is
not expected to have a significant
economic impact on a substantial
number of small entities. Further, under
the Small Business Regulatory
Enforcement Fairness Act of 1996, 5
U. S. C. 801 ( SBREFA), an agency is
required to produce compliance
guidance for small entities if the rule
has a significant economic impact.
The Small Business Administration
SBA) defines a small business as one
that is " independently owned and
operated and which is not dominant in
its field of operation." The definition of
small business varies from industry to
industry to the extent necessary to
reflect industry size differences
properly. An agency must either use the
SBA definition for a small entity or
establish an alternative definition, in
this instance, for the workforce
industry. The Departments have
adopted the SBA definition for purposes
of this certification.
The Departments have notified the
Chief Counsel for Advocacy, SBA,
under the RFA at 5 U.S. C. 605(b), and
certify that this rule will not have a
significant economic impact on a
substantial number of small entities.
This finding is supported, in very large
measure, by the fact that small entities
are already receiving financial
assistance under the WIA program and
will likely continue to do so under the
WIOA program as articulated in this
Final Rule.
Affected Small Entities
The Final Rule can be expected to
impact small one-stop center operators.
One-stop operators can be a single entity
public, private, or nonprofit) or a
consortium of entities. The types of
entities that might be a one-stop
operator include: (1) An institution of
higher education; (2) an employment
service State agency established under
the Wagner-Peyser Act; (3) a
community-based organization,
nonprofit organization, or workforce
intermediary; (4) a private for-profit
entity; (5) a government agency; (6) a
Local WDB, with the approval of the
chief elected official and the Governor;
or ( 7) another interested organization or
entity that can carry out the duties of
the one-stop operator. Examples include
a local chamber of commerce or other
business organization, or a labor
organization.
This Final Rule can also be expected
to impact a variety of AEFLA local
providers: (1) Local education agencies;
2) community-based organizations; ( 3)
faith -based organizations; (4) libraries;
community, junior, and technical
colleges; ( 5) 4 -year colleges and
universities; (6) correctional
institutions; and ( 7) other institutions,
such as medical and special institutions
not designed for criminal offenders.96
Impact on Small Entities
The Departments indicate that
transfer payments are a significant
aspect of this analysis in that the
majority of WIOA program cost burdens
on State and Local WDBs will be fully
financed through Federal transfer
payments to States. We have highlighted
costs that are new to WIOA
implementation and this Final Rule.
Therefore, we expect that this WIOA
Final Rule will have no cost impact on
small entities.
C. Small Business Regulatory
Enforcement Fairness Act of 1996
The Departments have concluded that
this Joint WIOA Final Rule does not
impose a significant economic impact
on a substantial number of small entities
under the RFA; therefore, the
Departments are not required to produce
any Compliance Guides for Small
Entities, as mandated by the SBREFA.
D. Paperwork Reduction Act
The purposes of the PRA, 44 U.S. C.
3501 et seq., include minimizing the
paperwork burden on affected entities.
The PRA requires certain actions before
an agency can adopt or revise a
collection of information, including
publishing for public comment a
summary of the collection of
information and a brief description of
the need for and proposed use of the
information.
As part of continuing efforts to reduce
paperwork and respondent burden, the
Departments conduct preclearance
consultation activities to provide the
public and Federal agencies with an
opportunity to comment on proposed
and continuing collections of
information in accordance with the
PRA. See 44 U.S. C. 3506( c)( 2)( A). This
activity helps to ensure that the public
understands the collection instructions,
respondents can provide the requested
data in the desired format, reporting
96 In terms of VR grantees, they are State
government entities and, by definition, are not
small entities.
55981Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
burden (time and financial resources) is
minimized, collection instruments are
clearly understood, and the
Departments can properly assess the
impact of collection requirements on
respondents.
A Federal agency may not conduct or
sponsor a collection of information
unless it is approved by the OMB under
the PRA and displays a currently valid
OMB Control Number. The public is
also not required to respond to a
collection of information unless it
displays a currently valid OMB Control
Number. In addition, notwithstanding
any other provisions of law, no person
will be subject to penalty for failing to
comply with a collection of information
if the collection of information does not
display a currently valid OMB Control
Number (44 U.S. C. 3512).
In accordance with the PRA, the
Departments submitted two ICRs—( 1)
Workforce Innovation and Opportunity
Act Common Performance Reporting
and ( 2) Unified or Combined State Plan
and Plan Modifications under the
Workforce Innovation and Opportunity
Act, Wagner-Peyser Act WIOA Title I
Programs, and Vocational Rehabilitation
Adult Education—to OMB when the
NPRM was published. The NPRM
provided an opportunity for the public
to send comments on the two
information collections directly to the
Departments; commenters also were
advised that comments under the PRA
could be submitted directly to OMB.
OMB issued a notice of action for each
request asking the Departments to
resubmit the ICRs, after considering
public comments, at the Final Rule
stage. Given that information collection
instruments were not ready at the time
the NPRM published, the Departments
provided additional opportunities for
the public to comment on the
information collections through notices
in the Federal Register that provided
additional comment periods on the
associated forms and instructions. These
comment periods provided at least 60
days for comments to be submitted to
the agencies. Each of these ICRs was
then submitted for OMB approval, and
additional notices were published in the
Federal Register that invited comments
to be sent to OMB for a period lasting
at least 30 days. The Departments also
submitted each ICR for further approval
to incorporate the provisions of this
Joint WIOA Final Rule; these Final Rule
ICRs were not subject to further public
comment. The Departments provide a
status of each ICR in the summary
section that immediately follows in this
portion of the preamble. Where a review
remained pending, when this preamble
was drafted, the Department will
publish an additional notice to
announce OMB' s final action on the
ICR. The Departments also discuss the
public comments received related to the
ICRs in this section of the preamble. It
should be noted that these ICRs have
been submitted under a procedure that
allows a collection to be sponsored by
one agency and later subscribed to by
other agencies. Such ICRs are classified
as " common forms." In making the
initial request, the host agency submits
the request and claims its portion of the
burden; ultimately, the full burden is
accounted for as other agencies
subscribe and claim their share of the
burden. For purposes of this Joint WIOA
Final Rule preamble, only the DOL
share of the burden is discussed. The
full burden is addressed in the
supporting statement used to justify the
request.
It should he noted that the ICR review
status reported in this section only
relates to requests related directly to the
Final Rule. Certain ICR packages that
were previously approved are being
updated to change references to those in
the Joint WIOA Final Rule. As has been
the practice throughout WIOA
implementation, the agencies will
continue to update stakeholders on the
status of the joint ICRs related to State
planning and performance
accountability through other means.
The Required Elements for the
Submission of the Unified or Combined
State Plan and Plan Modifications
Under the Workforce Innovation and
Opportunity Act Information Collection,
OMB 1205-0522 substantive
requirements were approved via a
notice of action dated February 19,
2016. As of the date of the drafting of
this preamble, the information
collection is being updated to reflect
references in the Joint WIOA Final Rule.
Also, the Workforce Innovation and
Opportunity Act Common Performance
Reporting ICR review is pending as of
the date this preamble was drafted. The
substantive requirements will be
approved through a notice of action by
OMB, and will take effect as of that date.
The Departments will announce this
approval.
The information collections in this
Final Rule are summarized as follows.
Workforce Innovation and Opportunity
Act Common Performance Reporting
Agency: DOL–ETA.
Title: Workforce Innovation and
Opportunity Act Common Performance
Reporting.
Type of Review: New collection.
OMB Control Number: 1205-0526.
Affected Public: State, Local, and
Tribal Governments; Private Sector; and
Individuals or Households.
Obligation to Respond: Required to
obtain or retain benefits (WIOA sec.
116).
Total Estimated Number of
Respondents Annually: 16, 246, 121.
Total Estimated Number of Annual
Responses: 32, 456, 962.
Frequency of Response: On occasion.
Total Estimated Annual Time Burden:
8, 372, 737 hours.
Total Estimated Annual Other Costs
Burden: $26, 147, 067.
Regulations Sections: 20 CFR part 680
adult and dislocated worker programs,
and ETPs); 20 CFR part 681 ( youth
program); 20 CFR part 652 ( Wagner-
Peyser Act Employment Service
program); 34 CFR parts 462 and 463
AEFLA program); and 34 CFR part 361
VR program).
ICR Approval Status: Not yet
approved.
Overview and Response to Comments
Received
Overview: This information collection
will collect common performance data
required under sec. 116 of WIOA from
all six core programs—the adult,
dislocated worker, youth, Wagner-
Peyser Act Employment Service,
AEFLA, and VR programs— as well as
from ETPs. The Departments will use a
common approach to standardize the
quarterly and annual reporting, as
appropriate, of common data elements
for all core programs and ETPs. These
data are in addition to other
performance data reported by each of
the core programs under current
information collections in accordance
with final joint and program -specific
regulations discussed elsewhere in this
issue of the Federal Register. The
Departments note that the OMB control
number for this new information
collection was shown in the NPRM as
1205-0420. After further review and
consultation with OMB, due to the need
to continue reporting other data
associated with WIA, 1205-0420 will
remain as a WIA-only collection and the
new WIOA performance collection will
receive the control number 1205-0526.
Response to Comments Received: The
Departments received general and
specific comments concerning this
performance information collection. The
comments focused specifically upon
three areas: Measurable skill gains; ETP;
and the ICR instruments.
General Comments
General comments focused on data
collection and overall burden.
55982 Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
Comments: One commenter stated
that the Departments should be aware
that the proposed definitions and rules
could create unintended incentives that
do not align with program objectives.
Another commenter stated that there is
too much data included in the WIOA
Joint Performance ICR. Several
commenters requested clarification
about data collection, reducing the
burden, and other requirements.
Departments' Response: The
Departments have established a
reporting system that reflects all the
requirements of WIOA and, to the extent
possible, safeguards against false or
inaccurate reporting. The statistical
adjustment model will contribute
greatly to such efforts. The WIOA
Performance Management, Information,
and Reporting System includes only
those elements that are required by
statute or are a necessary component of
the calculation of performance
indicators or report items. While the
Departments recognize that the data
requirements are potentially
burdensome, the Departments have
made every effort to minimize the
burden as much as possible.
Additionally, the Departments recognize
concerns regarding clarification about
data collection for several of the primary
indicators of performance and the
burden of collection and management of
data on common performance
accountability requirements, as well as
ensuring consistency in reporting across
programs. The Departments recognize
that State agencies will be faced with
the challenges and burden of
implementing the new requirements
and responsibilities imposed by WIOA,
including revising their management
information systems. The Departments
are working together to provide both
joint and program -specific guidance and
technical assistance to assist States in
implementing these changes. The ETA
will also issue an agency -specific
reporting handbook for the PIRL along
with guidance.
Comments: A few commenters
discussed the use of supplemental data
i.e., a proxy for wage records that do
not exist) in the context of the median
earnings performance indicator.
Specifically, two commenters expressed
opposition to the use of supplemental
data for the median wage indicator,
commenting that under WIA reporting,
any wage -related measure relied
exclusively on wage records. Another
commenter remarked that the collection
of supplemental data on wages is
burdensome. Other commenters
recommended that calculation of
median earnings should not permit the
utilization of supplemental data, but
should rely solely on quarterly wage
records.
Departments' Response: The
Departments considered the concerns
expressed by commenters regarding the
possible burden and reliability of
supplemental data and follow-up
methods to report on the median wage
indicator. However, the Departments
have concluded that in order to hold
States accountable for employment and
earnings outcomes of all program
participants, States will be allowed to
collect and verify supplemental wage
information to demonstrate employment
outcomes in the 2nd and 4th quarters
after exit in those instances where wage
records are not available. Using
supplemental data ensures that
programs may track participants even if
those participants' employment and
wage information is not contained in the
State' s quarterly wage record system. If
a State uses supplemental information
to report on the employment rate
indicators, the State must also use
supplemental information to report on
the median earnings indicator. States
that elect not to use supplemental data
and follow-up methods are expected to
include participants who do not have
the necessary data points to complete a
wage record match in the denominator
of the calculation. Those individuals
would be counted as failures on the
three employment indicators. In some
programs, follow-up procedures have
already been established and have been
used historically to supplement wage
record matching. The Departments
conclude that allowing States to use
supplemental follow-up methods for
individuals who are self-employed, do
not provide a valid SSN, or other
specified reasons will provide a more
comprehensive picture of program
performance. The Departments will
issue joint guidance to define further
what constitutes acceptable forms of
supplemental data and follow-up
methods.
Comments: Many commenters
discussed the credential attainment rate
indicator, several of whom commented
on the calculation methodology. In
particular, three commenters said the
proposed methodology for calculating
the credential attainment rate would
overlook the progress and
accomplishments of students who enter
adult education programs with high
school credentials. A commenter
remarked that if the denominator for the
credential attainment indicator includes
all participants, it would serve as a
disincentive to co -enrollment; however,
if it only includes participants in
training, it would create a disincentive
for widespread access to training. Two
commenters stated that the proposed
calculation of the credential rate
denominator would create a negative
incentive and serve to steer low -skilled
individuals away from training services.
Another commenter suggested that only
participants who received training
services should be counted in this
indicator. Still another commenter
urged the Departments to design this
indicator to prevent counting a
participant more than once. Two
commenters recommended that
secondary and postsecondary results be
separated for the calculation of the
credential attainment rate indicator.
Some commenters requested
clarification on various aspects of the
credential attainment rate indicator.
Three commenters asked the
Departments to clarify what would
constitute a certificate. A commenter
requested that the Departments provide
clear definitions for the terms
recognized postsecondary credentials"
and " industry recognized credentials."
Similarly, two other commenters
suggested that the Departments provide
guidance on this issue. Another
commenter recommended that
clarification be provided regarding how
far in the past a date of enrollment in
education or training may be to count
for purposes of this indicator. Two
commenters requested clarification
regarding whether Adult Basic
Education (ABE) participation in classes
at the ninth grade equivalent or higher
would count as enrollment in secondary
education. A different commenter
requested additional information
regarding the counting of participants
who obtain multiple credentials during
the same program year. A couple of
commenters requested clarification
about what services would qualify as a
participant having received training for
the purpose of the credential attainment
rate. Finally, two commenters asked
whether the credential obtained must he
based on WIOA-funded services and
provided by an ETP.
Departments' Response: The
Departments understand the concerns
expressed by many commenters about
whether the credential attainment rate
indicator includes all participants of
any core program. The credential
attainment rate indicator focuses on
participants who are enrolled in an
education or training program because
the purpose of the indicator is to
measure performance related to
attainment of credentials received as a
result of successful participation in
these programs; therefore, it would not
be reasonable to measure credential
attainment against a universe that
55983Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
includes other individuals who are
seeking critical WIOA services other
than a credential. The final regulations,
as well as the final WIOA Joint
Performance ICR, will make clear that
this indicator measures the percentage
of those participants enrolled in an
education or training program
excluding those in OJT and customized
training) who obtained a recognized
postsecondary credential or a secondary
school diploma, or its recognized
equivalent, during participation in or
within 1 year after exit from the
program. Moreover, a participant who
has obtained a secondary school
diploma or its recognized equivalent is
only included in the percentage of
participants who obtained a secondary
school diploma or recognized
equivalent if the participant is also
employed or is enrolled in an education
or training program leading to a
recognized postsecondary credential
within 1 year after exit from the
program. This WIOA Joint Performance
ICR has been revised accordingly such
that the postsecondary portion of the
credential attainment rate denominator
includes only those postsecondary
exiters in an education or training
program. Postsecondary exiters in on-
the-job training and customized training
are excluded from the credential
attainment rate indicator because the
Departments recognize that those
trainings do not typically lead to a
credential.
A " recognized postsecondary
credential" is defined in WIOA sec.
3( 52) as " a credential consisting of an
industry -recognized certificate or
certification, a certificate of completion
of an apprenticeship, a license
recognized by the State involved or
Federal Government, or an associate or
baccalaureate degree." The Departments
will issue joint guidance that further
defines what constitutes an acceptable
credential for the credential attainment
rate numerator, including guidance
regarding an acceptable industry -
recognized certificate or certification
and definitions for each type of
credential. The Departments have not
provided a threshold for participation in
education or training programs for
inclusion in the indicator. The
Departments will provide further
program -specific guidance on what
constitutes education or training for
inclusion in the credential attainment
rate indicator, for purposes of the core
programs. The credential obtained is not
required to be WIOA-funded or based
on services provided by an eligible
training provider. There is no reason to
capture the date training concluded.
The credential indicator is calculated
based on those in education or training
at any point in the program or within 1
year after exiting the program,
regardless of whether the training
ended.
Because WIOA sec. 116( b)( 2) specifies
the percentage of participants who
obtain a recognized postsecondary
credential or secondary school diploma
or its recognized equivalent in a single
indicator, the Departments will not
separate secondary and postsecondary
credential attainment into two separate
indicators. Any acceptable credential
attained during the program or within 1
year following program exit counts
toward the credential attainment rate
indicator. The PIRL records outcomes
regarding this indicator in the following
manner.
First, for participants enrolled in a
postsecondary education or training
program (other than OJT and
customized training), PIRL 1811, Most
Recent Date Enrolled in Education or
Training Program Leading to a
Recognized Postsecondary Credential or
Employment During the Program,
records enrollment. Participants
enrolled in such a program are included
in the denominator for calculating
outcomes for this indicator. PIRL 1801,
Date Attained Recognized Credential,
records the date on which an individual
attained a recognized credential, and
PIRL 1800, Type of Recognized
Credential, records the type of
recognized credential attained. The
Departments note that PIRL 1801
formerly PIRL 1705) has been renamed
as suggested by a commenter.
Participants are included as successes in
the numerator of this indicator if at least
one recognized credential is earned
either during participation in the
program or within 1 year (i.e., four
quarters) after exit from the program. A
participant counts in the denominator
and numerator only one time regardless
of how many credentials a " participant"
attains prior to an " exit." However, if a
participant" " exits" more than once in
a program year and attains a credential
prior to each exit, the program will
report the credential attained prior to
each exit. The Departments note that
participants who enter a program with
a secondary school credential are
counted as a success on this indicator if
they earn a postsecondary credential
during participation in the program or
within 1 year after exit from the
program.
Second, for participants who attain a
secondary school diploma or its
recognized equivalent, PIRL 1401,
Enrolled in a Secondary Education
Program, records enrollment. ABE
participation in classes at the ninth
grade equivalent or higher will count as
enrollment in secondary education.
Participants enrolled in such a program
are included in the denominator for
calculating outcomes regarding this
indicator. As stated above, PIRL 1801,
Date Attained Recognized Credential,
records the date on which an individual
attained a recognized credential, and
PIRL 1800, Type of Recognized
Credential, records the type of
recognized credential attained,
including high school diploma or
equivalency. WIOA sec. 116(b)( 2)( A)(iii)
requires that program participants who
obtain a secondary school diploma or its
recognized equivalent shall be included
in the percentage counted as meeting
the criterion only if such participants
have obtained or retained employment
or are in an education or training
program leading to a recognized
postsecondary credential within 1 year
after exit from the program. To that end,
PIRL 1406, Date Enrolled in a Post Exit
Education or Training Program, records
the date of post -exit enrollment in such
a program. Participants are included as
successes in the numerator of this
indicator if, during the program or
within 1 year after exit from the
program, they are enrolled in a post -exit
education or training program (PIRL
1406), attain a recognized postsecondary
credential (PIRL 1800), or obtain or
retain employment (PIRL 1600, PIRL
1602, PIRL 1604, PIRL 1606). In the
final WIOA Joint Performance ICR,
those participants who are receiving
adult education services while
incarcerated will not count in the
employment retention, earnings,
credential attainment, or effectiveness of
serving employers indicators. These
individuals will only be counted, for
performance calculation purposes, in
the measurable skill gains indicator. The
Departments recognize burden concerns
for tracking credential attainment.
WIOA requires the collection and
reporting of the credential attainment
rate indicator for all core programs,
except for the Employment Service
program, authorized under the Wagner-
Peyser Act as amended by title III of
WIOA (see WIOA sec. 116(b)( 2)( A)(i)).
The Departments will provide guidance
and technical assistance for tracking and
reporting credential attainment.
Comments: A few commenters
expressed concern that a participant
may only be in the denominator once
but may be in the numerator multiple
times, thereby disproportionately
affecting the indicator. Commenters
suggested that the measurable skill gains
report templates be aligned with the
55984 Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
reporting instructions and designed so
that a participant is not counted
multiple times. Another recommended
that the Departments revise the
reporting period to include a reasonable
lag period, which would provide
participants with a reasonable
opportunity to achieve a gain. Three
commenters suggested that participants
who receive educational or training
services while incarcerated or
institutionalized be included in the
measurable skill gains performance
indicator in order to avoid a
disincentive to serve these populations.
However, a commenter remarked that
institutionalized individuals should be
excluded from the indicator because
they will not likely be able to continue
in secondary or postsecondary
education. A commenter requested
clarification on the inclusion of
incarcerated individuals in this
indicator. One commenter stated that
the program year timeline does not align
with the performance needs of the
participant and would result in an
underestimation of the true rate of skill
gains. The commenter also contended
that if a participant is receiving services
under multiple programs, the individual
could be counted multiple times,
creating an incentive to recruit and
promote providers offering short-term
trainings with easily achieved
milestones.
Departments' Response: The
performance calculation for the
measurable skill gains indicator is the
same as it is for all other indicators. If
a participant exits a program more than
once in a program year and achieves
measurable skill gains prior to exiting
each time, then that participant could
achieve more than one measurable skill
gain in a program year. A participant
may achieve more than one measurable
skill gain prior to each exit, but only one
gain per exit will be counted in the
performance calculations. If a
participant is co -enrolled in multiple
core programs and meets the definition
of participant for each of the multiple
programs in which the participant is
enrolled, the participant would count in
each program' s indicators of
performance, including the measurable
skill gains indicator.
The Departments will provide
program -specific guidance and technical
assistance to define the types of services
and trainings that constitute " an
education or training program that leads
to a recognized postsecondary
credential or employment". Individuals
not in the types of programs specified
will not be included in the measurable
skill gains indicator.
The Departments recognize the
concern raised by commenters that the
program year timeline may not provide
participants with reasonable
opportunity to achieve a gain,
particularly when a participant enters
the program late in a program year.
Therefore, the Departments considered
whether a minimum time threshold
should be incorporated into the
measurable skill gains indicator.
However, the Departments have
concluded that given the diversity of
participant needs and program services,
imposing a time period by which
progress is to be documented would be
somewhat arbitrary and difficult. Such
practice could result in excluding a
number of participants from
performance accountability reporting
requirements, even if those participants
achieve a gain under one of the
measures of progress. The Departments
note that the negotiations process can
and should take into account enrollment
patterns and lower baseline data when
establishing negotiated levels of
performance for the measurable skill
gains indicator.
All participant outcomes, regardless
of whether achieved at the end of the
reporting period in which a participant
enrolled or in the next reporting period,
will count as positive outcomes for the
program. The Departments are
concerned about incentivizing behavior
that discourages service providers from
enrolling disconnected youth, in
particular, when they first approach
programs, or that purposefully attempts
to focus service on individuals who are
more likely to obtain a positive
outcome. The Departments emphasize
that programs must not delay
enrollment or prohibit participants from
entering a program late in the program
year.
It is not the Departments' intent to
exclude incarcerated individuals from
the measurable skill gains indicator. The
PIRL includes a code value for
incarcerated participants in PIRL 923,
Other Reasons for Exit (formerly PIRL
971, Exclusionary Reasons). This
element is used to exclude incarcerated
participants who are enrolled in adult
education from all performance
indicators except for the measurable
skill gains indicator if they remain
incarcerated at program exit. The
Departments recognize that some
programs (i.e., the youth and adult
education programs) offer educational
services to incarcerated individuals, and
participants may make interim progress
or other gains in secondary or
postsecondary education. The final
information collection specifies that the
purpose of the code values specific to
incarcerated participants is to exclude
incarcerated individuals from the
performance calculations for the
employment indicators (employment in
2nd and 4th quarter after exit, median
wages, and effectiveness in serving
employers) and the credential
attainment indicator, but not to exclude
them from performance calculations for
the measurable skill gains indicator.
This means that programs that serve
incarcerated individuals would he held
accountable for the measurable skill
gains indicator.
Comments: Regarding the burden of
collecting data for measurable skill
gains, commenters stated that the
performance indicator would be too
burdensome to collect for adult and
dislocated worker programs.
Commenters also inquired how
frequently the data used to calculate this
indicator need to be collected. One
commenter remarked that it has not
tracked the data required to calculate
measurable skill gains and it would be
burdensome to gather this information
retroactively. A commenter emphasized
the need for guidance regarding
measurable skill gains. Another
commenter requested that guidance for
the indicator consider skills beyond
typical quantifiable measures, using the
NFJP model as a basis, which includes
developing detailed custom training
plans for each participant. One
commenter inquired whether local areas
will be required to implement a
standard measure or test of proficiency
and whether there will be technical
assistance to operationalize the real-
time recording of proficiency levels.
This commenter compared the potential
challenges of the measurable skill gains
indicator for local areas to the
challenges experienced under the WIA
literacy/ numeracy gains common
measure. One commenter supported the
proposal to phase in the implementation
of the measurable skill gains indicator
and suggested that grade point average
GPA) be used as a method to measure
and document skill gains.
Departments' Response: The
Departments recognize burden concerns
for States due to the changes in the
performance reporting requirements;
however, WIOA sec. 116(b)( 2)( A)(i)
requires that the measurable skill gains
indicator apply across all core programs,
except for the Wagner-Peyser Act
Employment Service program, in order
to assess the effectiveness of States and
local areas in achieving positive
outcomes for individuals served by
those programs. Therefore, the
implementation of the measurable skill
gains indicator cannot be phased in and
States are required to begin collecting
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data for this indicator in PY 2016.
Having said this, the Departments
recognize that some programs will not
be able to collect data and report on all
indicators immediately. The
Departments will provide program -
specific guidance as appropriate.
In order to address the various
comments and questions received
regarding the measurable skill gains
indicator, the Departments will provide
program guidance and technical
assistance regarding each core program
in WIOA titles I, II, and IV to further
clarify the measurable skill gains
indicator. The Departments have
concluded, however, that additional
types of documented progress for
determining whether a participant has
achieved measurable skill gains beyond
the five types set forth in final
677. 155( a)( 1)( v) will not be included.
The Departments note the five gain
types included in the regulation and the
WIOA Joint Performance ICR share a
level of rigor and provide enough
flexibility to allow for the commenters'
recommended option.
The Departments acknowledge the
suggestion to use GPA as a method to
measure skill gains. The Departments
reiterate that, as stated above, both the
Final Rule at § 677. 155( a)( 1)( v) and the
WIOA Joint Performance ICR will define
only five standardized ways States can
measure and document participants'
measurable skill gains. The Departments
note, however, that GPA may be
reflected in PIRL 1807 ( former PIRL
1801) and PIRL 1808 ( former PIRL
1801). Each of these elements records
measurable skill gains as documented
by a transcript or report card for either
secondary or postsecondary education
for a sufficient number of credit hours
to show that a participant is meeting the
State unit' s academic standards.
Comments: A commenter suggested
that measurable skill gains should
include attainment of competencies to
stay abreast of innovative educational
practices; secondary and postsecondary
education should be measured
separately to enhance precision and
clarity of the indicator; and interim
progress should be achieved after
attainment of 12 rather than 24 credit
hours. Another commenter inquired as
to what is considered an adequate rate
of measurable skill gains for part-time
students.
Departments' Response: The
Departments acknowledge the
suggestion to include attainment of
competencies to stay abreast of
innovative educational practices but
have not added measures beyond the
five standardized ways for documenting
measurable skill gains in
677. 155( a)( 1)( v) and the WIOA Joint
Performance ICR. In regard to the
comment related to measuring
secondary and postsecondary education
separately, the Departments will not
separate secondary and postsecondary
credential attainment into two separate
indicators of performance because
WIOA specifies the percentage of
students who obtain a recognized
postsecondary credential or secondary
school diploma as a single indicator of
performance for the performance
accountability measures. However, the
Departments note that it is important to
capture data on students who achieve a
high school diploma or its recognized
equivalent, as well as a recognized
postsecondary credential; therefore,
both will be included in one indicator
for performance accountability purposes
as indicated by the " Credential
Attainment Rate" tab in the WIOA
Statewide Performance Report
Template), but programs will be able to
collect data on achievement of both
types of credentials, as appropriate, in
PIRL 1800 ( former PIRL 1700), which
records Type of Recognized Credential
attained. The Departments conclude
that for the measurable skill gains
indicator, the multiple gain types
proposed are rigorous and provide
flexibility to allow for gains to be
captured in a variety of ways. While
commenters may be concerned about
how the Departments will adjust for
variation among States in gains for
clients enrolled in longer-term
postsecondary programs, the
Departments note that participants
would have the opportunity for success
in the transcript type gain, which would
allow a program to record a gain for
such participants in every year.
Furthermore, the statistical adjustment
model is designed to compensate for
these variations in the consideration of
levels of performance, thereby
compensating for State -to -State
variances in the length of postsecondary
education. The Departments will not
weigh performance indicators based on
degree of program difficulty. The
Departments emphasize that programs
may not purposefully attempt to focus
service on individuals perceived as
more likely to obtain a positive
outcome, or selectively enroll
participants in programs in which
positive outcomes on these indicators
are perceived as more likely, but for
which such enrollment is not in the best
interest of the participants.
Lastly, the Departments recognize
concerns regarding credit hours for
interim progress. In the NPRM, the
Departments proposed a measure
requiring a transcript or report card for
1 academic year or for 24 credit hours.
The Departments agree with the concern
that a transcript for 1 academic year or
24 credit hours is too onerous for part-
time students and have changed this
measure to require that the transcript or
report card reflect a sufficient number of
credit hours to show a participant is
achieving the State unit' s academic
standards. This change will be reflected
in the Joint WIOA Final Rule at
677. 155( a)( 1)( v)(C), which will
document progress through receipt of a
secondary or postsecondary transcript
or report card for a sufficient number of
credit hours that shows a participant is
meeting the State unit' s academic
standards. The Departments anticipate
that, for participants in postsecondary
education, a sufficient number of credit
hours would be at least 12 hours per
semester or, for part-time students, a
total of at least 12 hours over the course
of two completed consecutive semesters
during the program year that shows a
participant is achieving the State unit' s
academic standards ( or the equivalent
for other than credit -hour programs).
Comments: A commenter
recommended that the Departments
implement processes in data collection
and reporting that are sensitive to
diverse populations. Specifically, this
commenter pointed out that the
significant barriers for some students
especially those at the lowest literacy
levels or non-native English speakers)
are often not taken into consideration
when developing measures to track
goals and student performance. Another
commenter suggested that special
programming efforts may require new
regulations or exceptions to existing
regulations. Other commenters
recommended that special priority
populations, including " low-level
learners", be reported as separate
cohorts and suggested that the reporting
methods take into consideration the
more difficult process for data collection
to follow up with these populations.
Departments' Response: The
Departments acknowledge the
recommendation to implement
processes for data collection and
reporting that are sensitive to special
populations with barriers to
employment. The Departments
recognize that, given the diversity of
participant needs and program services,
the State agencies will be faced with the
challenges and burden of implementing
the new requirements and
responsibilities imposed by WIOA,
including the challenges associated with
revising the management information
systems to collect information on
diverse populations.
55986 Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
However, for consistency purposes in
reporting, the Departments will not
implement additional exceptions to
these final regulations. The Departments
have provided rules to accommodate
certain exceptional circumstances. For
example, criminal offenders in
correctional facilities are not included
in employment and earnings indicators
or the credential attainment rate
indicator if they remain incarcerated at
program exit, since they do not have the
same opportunity to engage in
unsubsidized employment or
postsecondary education as do others in
the general population. Likewise,
participants who score at low levels of
literacy are not included in credential
attainment rate indicators unless they
are enrolled in programs that provide
instruction at or above the ninth grade
level. These measures provide a
reasonable approach to providing
accountability while acknowledging the
needs of vulnerable populations.
Comments: Multiple commenters
provided feedback on two basic
approaches to compiling the
information necessary for a compliant
ETP performance report that would
achieve the stated objective of
maximizing the value of the template for
stakeholders. In the first approach,
grantees would complete the ETP
performance reports and make them
available using the proposed template.
Under that approach, one commenter
favored grantees completing and making
available the information using the
proposed template, reasoning that it
would give States the flexibility to
compile and reconcile their own data.
Commenters in another State agreed this
approach would maximize the value of
the report for local use. One commenter
said that its State does not collect
program level data for its large public
institutions as part of the criteria to be
an ETP, but the commenter
recommended that program level data
should be reported for those who
provide training to participants in the
WIOA adult and dislocated worker
programs. In the second approach,
grantees would send the necessary
aggregate data to the Department, which
would then compile, format and display
the data.
One commenter favored this approach
because it would increase the likelihood
that reporting would be consistent,
which would facilitate analysis and
comparison. Another commenter
suggested that, because each State has
different access rights to information,
the burden on States could he
drastically reduced if WIOA partners
could submit their reports to their
Federal reporting agency that is then
responsible for consolidating the
information. Another commenter
requested that DOL not specify the
manner in which ETP performance
reports are filed, reasoning that it would
be easier for State agencies to run data
required by the template rather than
requiring ETPs to modify their systems
to capture all the information required
by the report. A commenter agreed that
much of the information in the ETP
report could be more efficiently
provided by State and local
governments—notably one-stop
caseworkers—rather than ETPs, which
have little or no access to some of the
data. Commenters in another State
remarked that local areas collect and
track information for the ETP
performance report constantly and
stated that transferring the data to a
centralized point for display to the
public seems unnecessary and
burdensome. Some commenters
supported flexibility and urged the
Departments not to mandate a method
for filing reports, allowing either of the
two approaches: grantees complete the
ETP performance reports using a
template and provide the Departments
with the appropriate location of the
report, or grantees send the necessary
aggregate data to the Departments where
the data could be compiled, formatted
and displayed in a standardized user-
friendly template and made available as
required by WIOA sec. 116( d)( 6)( B).
Departments' Response: WIOA sec.
116( d)( 1) requires the Secretary of
Labor, in conjunction with the Secretary
of Education, to develop a template for
performance reports to be used by
States, Local WDBs, and ETPs for
reporting on outcomes achieved by
participants in the six core programs.
The statute further requires that these
templates for performance reports be
designed in a manner that reflects the
need to maximize the value of these
templates for workers, job seekers,
employers, local elected officials, State
officials, Federal policy -makers, and
other key stakeholders. Ultimately, as
required by WIOA sec. 116( d)( 6), the
State must make available, in an easily
understandable format, the performance
reports for the ETPs. Based on review
and consideration of the comments, the
Departments have concluded that the
standardization of the submission
approach would lead to the best results
in terms of data quality and will be
providing submission details in a
separate publication.
Comments: Many commenters
expressed concern regarding the level of
burden to ETPs for collecting the
required data. Comments on burden
pertained to required data elements as
well as the data required for WIOA and
non-WIOA students in particular. Some
of these commenters recommended that
the Departments lessen the burden by
providing States the flexibility to
develop ETP reporting requirements
specifically for the elements related to
wage data. One commenter
acknowledged the data collection
challenge for some ETPs but asserted it
was important to have data on all
students in order to help WIOA
participants make informed decisions
when selecting a training program.
Another commenter remarked that it
would be challenging to track down
students to identify information as
needed. A State agency expressed
concern that ETPs would incur
substantial burden to modify their
systems to track and report data specific
to WIOA participants. Another
commenter said it is unlikely all
providers will be able to collect the
required data, so there may be data gaps
for non-WIOA participants. A
commenter expressed concern that the
ETP performance report would not
encourage entities other than colleges to
participate in training because the data
collection would seem intrusive to
smaller facilities. This commenter also
stated that collecting detailed program
level data would be ineffective due to
the small number of enrollments in
training programs. Other commenters
expressed similar concerns that data
collection for the ETP performance
report would seem intrusive to smaller
training facilities and that information
and documentation for low-income and
younger clients would be difficult.
Another commenter stated that
disaggregated reports would be largely
blank due to the relatively small number
of participants and the need to maintain
confidentiality.
Departments' Response: The
Departments acknowledge the
commenters' concerns and recognize the
need to identify effective data collection
strategies. However, the Departments
have no authority to reduce the ETP
reporting requirements set forth in
WIOA sec. 116( d)( 4), which mandate
the collection of specific information for
WIOA participants and for all
individuals engaged in a program of
study (or equivalent) for each such
program of study provided by each
eligible training provider, as outlined in
the final regulations at § 677. 230( a). The
Departments recognize concerns
expressed regarding the level of burden
to ETPs for collecting the required data.
In particular, WIOA sec. 116(d)(4)(A)
requires information specifying the
levels of performance achieved, for all
55987Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
individuals engaged in a program of
study, with respect to the primary
indicators of performance for
employment, earnings, and credential
attainment. Moreover, WIOA sec.
116( d)( 4)( B) requires the total number of
individuals exiting from a program of
study. Finally, WIOA secs. 116( d)(4)( C)—
F) require additional information
regarding participant counts, participant
exits, average cost per participant, and
number of participants with barriers to
employment as described in the
proposed definitions.
In addition, the Departments have
concluded that States are permitted to
use ITAs for out-of-school WIOA youth
participants ages 18 to 24, as provided
in the DOL WIOA Final Rule at 20 CFR
681. 550. For the purpose of the annual
ETP performance report, WIOA out-of-
school youth, ages 18 to 24,
participating in a program of study
using an ITA are reported in both the
ETP performance report as well as in the
State and Local annual reports. Because
WIOA sec. 116(d)(4) does not describe
such youth, the Departments note that
when such youth are reported in the
ETP performance reports, their
performance is reported using the same
performance indicators as prescribed for
WIOA adult and dislocated worker
participants (i.e., the primary indicators
of performance specified under WIOA
sec. 116( b)( 2)( A)(i)),which will be
further specified in implementing
regulations at § 677. 155( a)( 1)( i) through
vi). Using the same metrics for out-of-
school youth using ITAs as well as for
other WIOA participants and
individuals in a course of study (or
equivalent) minimizes the burden on
ETPs. The Departments note that such
youth are excluded from the required
reporting identified at § 677. 230( a)( 1)( i)
through (iii),but are included in the
counts required by (a)( 2) through (a)( 4).
The Departments further note that such
youth are additionally reported on in
the State and Local annual reports in
accordance with §§677. 155( d), 677. 160,
and 677. 205 as described in those
sections. The Departments will provide
additional guidance on the treatment of
these out-of-school youth using ITAs
through the information collection
process and in guidance. Therefore, for
purposes of reporting on the ETP
performance report, references to the
adult and dislocated worker programs
under title I of the WIOA adult program
include out-of-school WIOA youth ages
18 to 24 participating in a program of
study using an ITA.
The Departments have concluded that
the WIOA Joint Performance ICR is in
line with WIOA sec. 116( d) and will not
reduce the number of required elements
in the ETP reporting template. The
Departments recognize the contribution
of ETPs that may serve smaller
populations and acknowledge that
suppression standards may limit data,
but have concluded that the WIOA Joint
Performance ICR aligns with WIOA sec.
116. The Departments also recognize the
interest in establishing processes for
accessing wage related data. The
Departments will provide additional
information on the parameters of the
collection and reporting of this
information through the associated ICR
and program specific guidance.
Comments: Regarding the PIRL,
multiple commenters addressed the use
of unique identifiers for program
participants. A commenter requested
clarification regarding how States would
match unique identifiers when not
using SSNs. Similarly, three
commenters asked whether all core
programs would be required to use the
same unique identifier for a participant.
Other commenters requested that the
Departments clarify if the unique
identifier must be an SSN. Another
commenter recommended that a method
for implementing a unique identifier be
identified and phased in over time in
order to allow States time to develop the
necessary data collection systems. One
commenter remarked that its core
programs are not interconnected and
would be unable to share unique
identifiers.
Departments' Response: The unique
identifier is not required to be an SSN.
However, wage matching with the State
UI system will be impossible for any
participant for whom an SSN is not
available. In those circumstances,
programs will need to rely on
supplemental follow-up methods for
determining wages at 2nd quarter and
4th quarter following program exit. State
VR agencies use a unique identifier now
and the VR program may be a resource
for other core programs when
developing such a system. The
Departments understand that many
State data systems for Education and
Labor programs are not interconnected.
There is no requirement to share a
common data system. Having separate
systems does not preclude matching
data to identify employment outcomes.
Comments: Commenters also
discussed cultural barriers to
employment. Four commenters urged
the Departments to define cultural
barriers clearly. Similarly, two
commenters recommended that the
Departments provide a less subjective
definition of cultural barriers to allow
for more consistency in the data.
Another commenter suggested that the
definition of cultural barriers be
expanded to include limited English
abilities. Two commenters stated that
PIRL 705 identifies both displaced
homemaker and cultural barriers. A
commenter expressed opposition to
tracking cultural barriers, reasoning this
could alienate populations it should be
serving and create liability for
discrimination -based lawsuits.
Similarly, another commenter expressed
concern about posing this question
without appearing discriminatory. Two
commenters opposed collecting
information on cultural barriers, stating
that it is subjective and adds no
significant value. Another commenter
asked whether cultural barriers should
be identified by the participant. One
commenter recommended that the
service providers, rather than the
participant, be responsible for
identifying cultural barriers. However,
another commenter suggested only
substantial, self -identified cultural
barriers should be reported. Still
another commenter contended that PIRL
705 is defined using a lesser standard
than WIOA, which references a
substantial cultural barrier. Two
commenters requested that the
Departments provide guidance
indicating how to collect data on
cultural barriers. A commenter
suggested that participants may be
unaware of the cultural barriers to
employment that they face, making the
data inaccurate.
Departments' Response: The statute
identifies " individuals who are English
language learners, individuals who have
low levels of literacy and individuals
facing substantial cultural barriers" as
three categories of an " individual with
a barrier to employment." These three
categories are treated as separate data
elements in the PIRL because both
individuals who are English language
learners and individuals with low levels
of literacy are elements that are required
to be used in the statistical adjustment
model, while the data element for
individuals who are facing substantial
cultural barriers is not required to be
used in the model. The Departments
understand that the determination of
cultural barriers is highly subjective and
have provided a definition that allows a
program to base the designation on a
participant's self -perception as to
whether his or her attitudes, beliefs,
customs, or practices pose a hindrance
to employment.
Comments: Five commenters
expressed concern and requested
clarification about the discrepancies
between the PIRL and RSA -911. For
example, a commenter stated that the
RSA -911 does not currently collect
PIRL 1802 ( Date of Most Recent
55988 Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
Measurable Skill Gains: Training
Milestone) or PIRL 1803 ( Date of Most
Recent Measurable Skill Gains: Skills
Progression). Another commenter
recommended that the Departments
align the PIRL and RSA -911 definitions
and reporting options for PIRL data
elements 1800 through 1804. Similarly,
another commenter suggested that the
Departments align the PIRL and RSA -
911 or provide a crosswalk between the
two sets of data elements.
Departments' Response: The
Departments note the RSA -911 ICR was
published prior to the proposed WIOA
Joint Performance ICR, which includes
the PIRL. Therefore, the RSA -911 did
not reflect all of the changes necessary
to align with the PIRL. The final RSA -
911 ICR will include new and/ or revised
data elements and definitions as
necessary to provide alignment with the
PIRL. In addition, RSA -911 data will be
submitted quarterly in order to align
reporting under the VR program, which
operates on a Federal fiscal year basis,
to the reporting of performance on a
program year basis as required under
these regulations.
Comments: Two commenters
expressed concern that the PIRL is
centered on DOL programs and is
difficult for other core programs to use.
A commenter said that it is unclear
which programs are responsible for the
transmission of the PIRL, or if each core
program should submit the report
separately. A commenter said that a
combined core PIRL would be
duplicative if States are required to
submit quarterly and annual reports as
well.
Departments' Response: Individual
core programs will submit data through
each core program' s information
collection. The entity that will submit
this data will vary by State based on the
level of data integration. The
Departments strongly encourage States
to improve data integration across
programs. The purpose of this collection
is to specify the elements that are
required to be reported by all core
programs and align the definitions of
the different data elements across the
core programs, thereby ensuring
consistency and comparability of the
data among all core programs and
States. The Departments note that, for
the programs that require submissions
of quarterly and annual reports, the
information obtained through this
collection will be part of these quarterly
and annual reports and not a
duplication of those reports.
Comments: A number of stakeholders
submitted comments on the burden
estimates for the State performance
report template, noting that the costs are
underestimated. In particular,
commenters suggested that the time to
collect data should he more than 15
minutes per response. Commenters also
cited the burden to obtain information
that is not currently available, including
the requirement to track individuals
after program exit and the need to
monitor data quality. A commenter
enumerated significant IT time and
costs, including more frequent reporting
and integration with partnering
agencies, to implement the required
changes. Another commenter remarked
that staff time spent on these activities
results in fewer direct services to
program participants. A commenter
asked for clarification about reporting
for multiple years and possible
duplication for co -enrolled participants,
commenting that enhancing the quality,
utility, and clarity of the information
collected would reduce the burden on
those who must respond. Another
commenter requested that an effort be
made to utilize any existing Federal and
State databases that already contain
some of the WIOA-required data
elements that need to be collected. One
commenter suggested that the
Departments develop a standardized
application or supplemental form that
includes fields for applicants to self-
report the required data elements.
Departments' Response: The
Departments acknowledge that an
increase in the burden estimate is
necessary to reflect more accurately the
costs in time and resources to begin
collecting, validating, and reporting new
requirements under WIOA's new
reporting system, particularly for the VR
program. As such, the burden estimates
in the RIA section of this Joint WIOA
Final Rule (see section V.A), as well as
the tables in section 12 of the
Supporting Statement for the WIOA
Joint Performance ICR (which cover
burden estimates) have been modified .
For example, in response to comments,
RSA has revised its methodology for
estimating burden related to new data
collection requirements in order to more
accurately reflect needed State
investments in personnel, time, and
other resources.
The Departments also understand the
increased administrative burden for
follow up and the collection of new
statutorily required data under WIOA,
such as cost per WIOA participant
served (see WIOA sec. 116(d)(2)( F),
which requires the State performance
report to include " the average cost per
participant of those participants who
received career and training services,
respectively, during the most recent
program year and the three preceding
program years"). The Departments made
every effort to provide a comprehensive
estimate of the costs incurred by
programs, State agencies, and all other
stakeholders in adhering to all WIOA
requirements and will provide direction
on issues such as identifying clients
without SSNs, streamlining processes
and eliminating duplication, timelines
for integration, alignment of the RSA -
911 with the WIOA PIRL, and best
practices for providing optimal initial
and follow-up services to participants in
subsequent guidance. Also, the
Departments agree with the commenter
that the enhanced use of technology in
the data collection and reporting
process will result in greater efficiencies
and reduced burden for States and local
programs. With regard to the
commenter' s other concerns about data
sharing among the core partners, the
Departments are currently working on
additional guidance to facilitate that
process. The burden estimate for the
collection and reporting of data was
updated in the issuance of the final
WIOA Joint Performance ICR to more
accurately reflect the time staff spent
obtaining and entering the required data
elements.
States may use existing databases to
assist in obtaining the required data
elements provided the data sharing
meets the required statutory and
regulatory privacy requirements.
However, States remain responsible for
ensuring the accuracy and timely
submission of required data elements.
States are not prohibited from
developing a standardized form that
would allow individuals to self-report
data, apart from information that is
necessary for the program to receive
Federal funds.
Comments: Several commenters
provided input on the definition of
participant and/ or participation period.
The majority of commenters expressed
opposition to establishing a new exit
date for an individual who has exited
and returned within the same program
year. A few commenters stated that the
proposed exit methodology will
increase the implementation burden
while producing less informative data.
Another commenter mentioned that the
proposal to combine multiple periods of
participation (POPs) when a participant
exits more than once in a program year
would reduce the reliability of quarterly
reports, increase the burden to manage
programs, and decrease the effectiveness
of the statistical adjustment model. A
few other commenters said that
implementing the definition of " exit" as
proposed would require modifications
to case management systems. A
commenter suggested that the definition
of " exiter" remain the same as under
55989Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
WIA. This commenter also remarked
that the definition of " exiter" as
proposed in the WIOA Joint
Performance ICR would provide an
accurate count of participants in a
program year for participant and
exiter" measures, but would
potentially duplicate participants in
primary performance outcome
measures. A commenter remarked that
the proposed definitions of
participant" and " exit" would require
a rolling system for reporting, but it is
not clear how this could be done
accurately to track performance.
Departments' Response: The
Departments acknowledge the
commenters' many concerns and
suggestions related to the Departments'
proposed approach to participation and
exit for individuals who exit more than
once in the same program year. To
respond to these concerns, the
Departments have altered the approach
to unique participants that was
published in the proposed WIOA Joint
Performance ICR. For performance
reporting purposes, States should report
participants separately for each time the
participant exits the program, with the
period of time the participant received
services prior to exiting sometimes
commonly called a " POP." In addition,
States should provide to the
Departments, for each of the WIOA titles
I and II core programs, and the VR
program, a unique identifier that stays
the same across multiple POP for the
same participant, but not necessarily the
same identifier across different
programs if the participant receives
services from multiple programs in the
same program year. The Departments
will use this unique identifier to
calculate a count of unique participants
in each program for each State, which
will be reported on the State
Performance Reporting Template. The
performance measures will be
calculated using the " exits" ( i.e., POP),
which the Departments conclude will
incentivize the provision of the most
effective and appropriate service
delivery strategy regardless of how
many previous POP an individual has
had. The Departments will provide
further guidance and technical
assistance to implement this in order to
ensure a consistent approach that
facilitates comparability across
programs.
Core programs administered by ETA
already utilize a " rolling four quarter
methodology" for quarterly reporting. In
other words, for each data element, the
most recent four quarters worth of data
are reported (which will be different for
different data elements due to the
timing of the availability of the data).
ETA will continue utilizing this
approach, which adjusts for seasonality
and which allows 1 year of data to be
reported on any given quarterly report.
Comments: Several commenters
discussed the collection of data
pertaining to barriers to employment. A
few commenters said that collecting the
data on barriers of employment would
be challenging and burdensome.
Similarly, a commenter stated that the
collection of this data would increase
the burden more than the value it would
provide and asked how the Departments
plan to communicate the results of the
data to local areas. Another commenter
stated that the proposed data on barriers
to be collected is unnecessary. A few
commenters requested clarification on
barriers to employment. In particular,
one of these commenters asked whether
it is expected to collect data on all
barriers to employment for each client.
Another commenter requested
clarification on how data on barriers to
employment would be collected. A
different commenter suggested the
Departments confirm that a participant
may be reported in multiple categories
for barriers to employment.
Departments' Response: WIOA sec.
116 requires a statewide report that
includes a breakout by those with
barriers to employment. The WIOA Joint
Performance ICR provides information
about the barriers to employment that
must be collected and how these data
will he collected. Additional
information on how these categories are
populated can be found in the PIRL and
Statewide Annual Report Specifications.
Comments: Some Commenters
pointed out that every barrier to
employment should not have to require
documentation to be validated. Two
commenters asked whether PIRL 802
formerly PIRL 702) determining " Low
Income", would apply to adult
education participants and whether
supporting documentation from the
participant would be required.
Similarly, another commenter said that
describing artificial barriers for ex -
offenders is a poor word choice for
describing their barriers to employment.
Departments' Response: WIOA
specifies new reporting requirements,
including data reporting related to
barriers to employment. The definition
of an " individual with a barrier to
employment" encompasses mandatory
populations. Low income and ex -
offenders are just two of the populations
included in the definition, representing
barriers to employment that must be
collected for purposes of the
performance accountability system
under WIOA. The Departments
recognize the importance of ensuring
that individuals with barriers to
employment receive services, and the
Departments recognize that States may
experience challenges with this data
collection. The Departments intend to
issue joint-and program -specific
guidance and technical assistance to
provide further clarification on each
employment barrier, how the data
should be collected, and necessary
documentation for each barrier.
Unified or Combined State Plan and
Plan Modifications Under the
Workforce Innovation and Opportunity
Act, Wagner-Peyser WIOA Title I
Programs, and Vocational
Rehabilitation Adult Education
Agency: DOL–ETA.
Title of Collection: Unified or
Combined State Plan and Plan
Modifications under the Workforce
Innovation and Opportunity Act,
Wagner-Peyser WIOA Title I Programs,
and Vocational Rehabilitation Adult
Education.
Type of Review: Revision.
OMB Control Number: 1205- 0522.
Affected Public: State, Local, and
Tribal Governments.
Obligation to Respond: Required to
obtain or maintain benefits (WIOA, secs.
102 and 103).
Total Estimated Number of
Respondents Annually: 38.
Total Estimated Number of Annual
Responses: 38.
Frequency of Responses: On
Occasion.
Total Estimated Annual Time Burden:
8, 136 hours.
Total Estimated Annual Other Costs
Burden: $0.
Regulations Sections: DOL
programs -20 CFR 652. 211, 653. 107( d),
653. 109( d), 676. 105, 676. 110, 676. 115,
676. 120, 676. 135, 676, 140, 676. 145,
677.230, 678.310, 678.405, 678.750(a),
681.400(a)(1), 681.410(b)(2), 682.100,
683. 115. ED programs -34 CFR parts
361, 462 and 463.
ICR Approval Status: Not yet
approved.
Overview and Response to Comments
Received
Overview: WIOA requires each State
to submit either a Unified or Combined
State Plan that fosters strategic
alignment of the six core programs,
which include the adult, dislocated
worker, youth, Wagner-Peyser Act
Employment Service, AEFLA, and VR
programs. The Departments have
interpreted " State," in this context, to
include the outlying areas of Guam,
American Samoa, Northern Mariana
Islands, the U. S. Virgin Islands, and, as
applicable, the Republic of Palau. This
55990 Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
means that each of the outlying areas
must submit a Unified or Combined
State Plan, in accordance with secs. 102
and 103 of WIOA, just as any State does.
The Unified or Combined State Plan
requirements improve service
integration and ensure that the public
workforce system is industry -relevant
and responds to the economic needs of
the State and successfully matches
employers with skilled workers. The
Unified or Combined State Plan
describes how the State will develop
and implement a unified and integrated
service delivery system rather than
separately discuss the State' s approach
to operating each core program
individually. This information
collection implements secs. 102 and 103
of WIOA.
While each State, at a minimum, must
submit a Unified State Plan covering the
six core programs, sec. 103 of WIOA
permits a State to submit a Combined
State Plan that includes the six core
programs plus one or more additional
Combined State Plan partner programs
listed in sec. 103( a)( 2) of WIOA. If the
State chooses to include one or more
Combined State Plan partner programs,
its Combined State Plan must include
all of the common planning elements
contained in the Unified State Plan and
an additional element describing how
the State will coordinate the additional
Combined State Plan partner programs
with the six core programs (WIOA sec.
103(b)( 3)).
Comments: One commenter
recommended that State Plans require a
labor market analysis.
Departments' Response: Although the
Departments agree with the comment,
no change to the WIOA State Plan ICR
is needed because it already requires a
labor market analysis consistent with
sec. 102( b)( 1) of WIOA.
Comments: Another commenter
expressed concern that the trucking
industry may struggle to secure " in -
demand" recognition in many States
unless a State' s obligations are further
clarified under section II of the Draft
Unified and Combined State Plan
Requirements document.
Departments' Response: The
Departments decline to change the
WIOA State Plan ICR in response to this
comment because States are encouraged
to use a variety of accurate, reliable, and
timely labor market information on
which to base their analyses in the State
Plan. The use of a variety of labor
market information allows States to
reliably determine " in -demand" labor
market needs, including for the trucking
industry.
Comments: Several commenters
provided input on section II(a)( 1)( A)(iii),
in which commenters proposed that
States include an assessment of the
employment needs of employers in
certain industries and sectors, including
a description of the knowledge, skills,
abilities, and credentials and licenses
required for employers. The
commenters also recommended
replacing " credentials and licenses"
with " recognized postsecondary
credentials."
Departments' Response: The
Departments conclude that it was
appropriate to keep " credentials and
licenses" rather than narrowing the
meaning of term by replacing it with
postsecondary credentials" since it is a
broad term that allows maximum
flexibility to States to determine their
needs and the WIOA State Plan ICR
already requires States to include
recognized postsecondary credentials."
Comments: A commenter stated that
when assessing the needs of employers,
it would be beneficial to collect
information on whether these various
employers are subject to sec. 503 of the
Rehabilitation Act.
Departments' Response: The
Departments decline to change the
WIOA State Plan ICR because it is not
the appropriate vehicle for collecting
information on whether employers are
subject to sec. 503 of the Rehabilitation
Act.
Comments: Some commenters noted
that section II(a)( 1)( B) would be an
appropriate opportunity to include labor
force participation rates for persons
with disabilities, including youth and
veterans with disabilities.
Departments' Response: The
Departments agree that understanding
labor force participation rates is
important and revised the collection
instrument in section II(a)( 1)( B)( i) to
include labor force participation rates.
Comments: A commenter suggested
that States collect information
concerning the numbers of individuals
with disabilities who are working in
segregated work environments
sheltered workshops") and who are
employed under a 14c waiver (receiving
sub -minimum wage).
Departments' Response: The
Departments decline to change the
WIOA State Plan ICR in response to this
comment because the change is not
necessary. Section 101( a)( 14) of the
Rehabilitation Act of 1973, as amended
by title IV of WIOA, requires the VR
agencies to conduct a semiannual
review and re-evaluation of individuals
served by the VR program who are
employed in sheltered settings or at
subminimum wage. The semiannual
reviews must be conducted for the first
2 years of the individual' s employment
and annually thereafter. Furthermore,
the VR services portion of the Unified
or Combined State Plan contains an
assurance that the State VR agency will
report information generated under sec.
101( a)( 14) to the Administrator of the
Wage and Hour Division of DOL.
Comments: Another commenter
proposed that knowledge and
familiarity with English be included in
the analysis of the current workforce
and that each Plan include a strategy for
addressing the adult education and
family literacy needs of the incumbent
workforce.
Departments' Response: The
Departments agree that such analysis
and strategies should be included and
expect States to provide a strategy for
addressing the needs of individuals
with limited English proficiency. Since
the WIOA State Plan ICR already
requires this as written, no change is
needed.
Comments: A commenter cited an
increase in State and Federal policies
aimed at increasing employment for
individuals with disabilities and
encouraged States to examine whether
or not their particular State is under any
of these policies, which would help
determine future labor market trends
and give further direction on increasing
employment for individuals with
disabilities.
Departments' Response: The
Departments decline to require an
examination of State policies as a way
to understand their possible impact on
employment for individuals with
disabilities since it goes beyond what
the State is required to do under WIOA
for purposes of the State Plan and may
be more appropriate for a formal study.
Comments: Another commenter
explicitly urged that financial literacy
be included as a component of
education. Specifically, the commenter
said that there should be an assessment
of financial literacy skills as part of the
assessment of education and skills level.
Departments' Response: The
Departments agree that financial literacy
plays a significant role in a person' s
overall success, and that the WIOA State
Plan ICR, as written, permits States to
identify what skills gaps exist in their
State, including a lack of financial
literacy. States are encouraged to look at
financial literacy as a possible need of
their population, but the Departments
decline to itemize every kind of skill
that could be included in an assessment
of education and skill level in the WIOA
State Plan ICR.
Comments: Several commenters asked
for clarification on what is meant by
skill gaps."
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Departments' Response: Determining
current gaps," " projected gaps," and
projected education and skills of the
workforce" is within the State' s
purview, and each State has flexibility
to identify what skills gaps or
mismatches exist in the State.
Comments: A commenter said
innovative partnerships with entities
such as faith-and community-based
organizations should be included in the
analysis of the State' s workforce
development, education, and training
activities in section II(a)( 2)( A) and
section III(a)( 2)( c).
Departments' Response: The
Departments agree and made a change
to the WIOA State Plan ICR by adding
a footnote clarifying that the phrase
workforce development activities"
could include a wide variety of
programs, including human services,
faith-and community-based
organizations, and educational
institutions.
Comments: A commenter asserted
that the requirements for the workforce
development, activities should include
reporting on, and not only an
assessment of, activities offered and to
what extent those activities are both
physically and programmatically
accessible to job seekers with
disabilities.
Departments' Response: The
Departments decline to change the
WIOA State Plan ICR in response to this
comment because it is more appropriate
to identify the extent to which these
activities are accessible during
monitoring than through the State Plan.
Sections V.7 and V.10 require States to
comply with physical and programmatic
accessibility requirements of WIOA sec.
188 and the Americans with Disabilities
Act of 1990.
Comments: A commenter said the
State' s strategic goal should be a guiding
rather than prescriptive document,
providing overall direction and
supporting Local WDBs in developing
strategies best suited to their local
economies.
Departments' Response: The
Departments decline to change the
WIOA State Plan ICR because it is
within the Governor' s discretion to
decide how broad the vision should be
for the State; however, engagement of
the Local WDBs is required under sec.
101( d) of WIOA in the development of
the State Plan.
Comments: Several commenters took
issue with the use of the term " sector
strategies" in section (II)(c)( 1) and
suggested that the language be refined.
Departments' Response: The
Departments agree and changed the
WIOA State Plan ICR to refer to
industry or sector partnerships" and to
align more closely with the statutory
language, including WIOA sec.
101( d)( 3)( B) and (D). Also, statutory
references were added for the
definitions of " career pathway" and " in -
demand industry sector or occupation"
to provide additional clarity concerning
this requirement.
Comments: Some commenters
requested career pathways and sector
strategies be addressed in State Plans
and requested further definition of
career pathways. Another commenter
requested that State Plans include
descriptions about credentialing and
integrating credentialing with sector
partnerships.
Departments' Response: The
Departments decline to change the
WIOA State Plan ICR in response to
these comments. The WIOA State Plan
ICR already includes requirements for
the State to describe both its sector and
career pathways strategy in section
II)(c), so it already supports the
inclusion of credentialing and its
integration with sector and career
pathways strategies. Although the
Departments did not revise the WIOA
State Plan ICR to include definitions of
career pathways" and " sector
partnerships," the Departments did add
statutory citations for the definitions of
those terms.
Comments: Commenters said the
language of section (II)(c)( 2) is more
detailed than the requirements under
WIOA sec. 102(b)( 1)( E), which the
commenters said only references the
alignment between core programs and
other resources available to the State."
Departments' Response: The
Departments agree with this comment,
and section IV has been revised in the
WIOA State Plan ICR to require a
description of the joint planning and
coordination among the core programs
and with other required partners and
other programs and activities included
in the Unified or Combined State Plan.
Comments: A commenter said the
Departments should clarify the intended
gaps" mentioned in the final sentence
of section II(c)( 2).
Departments' Response: The
Departments clarify the meaning in the
final sentence of section (II)(c)( 2) by
changing the word " gaps" to
weaknesses" and by adding a reference
to section II(a)( 2) to explain what
analysis should be taken into account
for this requirement. However, the
Departments decline to add a reference
to section II(a)( 1)( B)(iv), since the
requirement is specifically regarding the
strengthening of workforce development
activities.
Comments: A commenter stated that
State strategy should unify wrap-around
services across programs.
Departments' Response: The
Departments decline to change the
WIOA State Plan ICR in response to this
comment, since section III(a)( 2)( C) of the
WIOA State Plan ICR already requires
coordination of supportive services
wrap-around services) among
programs.
Comments: Another commenter
recommended amending language,
which clarifies that States can and
should be coordinating and aligning
services across programs in a manner
that achieves the goals of industry and
sector partnerships. The same
commenter recommended strengthening
the language to clarify that the
description required is not limited to
direct employer services, but should
also include any other programs and
activities that will support service
delivery to employers.
Departments' Response: The
Departments concur with this
suggestion to reinforce the importance
of industry and sector partnerships and
have amended the requirement. With
respect to the comment concerning
service delivery to employers, the
Departments conclude that the language
is sufficient as originally written to
include both direct and indirect services
to employers.
Comments: A commenter was unclear
as to the source of the requirement that
the State outline additional strategies for
coordinating " services to employers."
Departments' Response: The
Departments conclude that both the
State and local governments are partners
in developing strategies for serving
employers. Using the authority WIOA
grants to the Secretaries to add
additional operational planning
elements as appropriate, the
Departments chose to include a
requirement around serving employers
since they are a critical customer.
Comments: Several commenters
supported extending the requirement to
cover a broader range of providers than
community colleges and area career and
technical education (CTE) schools, but
noted that there is no formal definition
of the term " education and training
providers" under WIOA.
Departments' Response: The
Departments agree with this comment
and revised section III(a)( 2) of the WIOA
State Plan ICR to include in section
III(a)( 2)( E) a separate requirement for
engagement with community colleges
and career and technical education
schools as required by sec.
102(b)( 2)( B)( iv) of WIOA. The
Departments included in section
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III(a)( 2)( F) a separate element for
engagement with other education and
training providers because such
coordination is necessary to have a
successful strategy for the provision of
services.
Comments: A commenter requested
that the listed examples in section
III(a)( 2)( E) include community
rehabilitation organizations (CROs). The
commenter noted that frequently
individuals with disabilities enter into
CROs after completing high school, and
these CROs are tasked with teaching
individuals with disabilities job skills
with the expectation of acquiring
employment in the community.
Departments' Response: The
Departments decline to change the
WIOA State Plan ICR in response to this
comment because CROs are not solely
education/ training entities.
Nevertheless, States may address CROs
in their plans.
Comments: A commenter suggested
adding a subsection to section 111( b) of
the WIOA State Plan ICR that includes
a description of proposed benchmarks
for the negotiated amounts and/ or
percentages that each one-stop partner
that is a unit of State government will
contribute to the local one-stop delivery
system costs. The commenter said that
including this element will provide for
better coordination and more
transparency in the negotiation of
shared costs.
Departments' Response: The
Departments concur that the inclusion
of information on one-stop partner cost
sharing arrangements in the State Plan
will provide for better coordination and
more transparency in the negotiation of
shared costs. However, the Departments
anticipate that States will not be ready
to provide their guidelines in the initial
Unified or Combined State Plans that
take effect July 1, 2016. Instead, the
Departments revised section III(b)( 2) of
the WIOA State Plan ICR to require
information about the State' s process for
developing guidelines and benchmarks
in the initial Unified or Combined State
Plan, and require the guidelines when
the State submits a modification to its
State Plan in PY 2018.
Comments: Another commenter
recommended emphasizing the role of
local and regional planning in
establishing appropriate assessment
standards.
Departments' Response: The
Departments concur with the comment
with minor modifications and made a
change to the WIOA State Plan ICR. The
Departments amended the requirement
that " such State assessments should
take into account local and regional
and also addedplanning goals,"
broken down by State and local area."
Comments: A commenter agreed with
the importance of the assessment of core
programs and one-stop partner programs
based on accountability measures, but
asserted that not all core programs
currently collect the same performance
information. The commenter requested
clarification on what constitutes
previous assessment results for the
preceding 2 years, noting that there may
not be a formal assessment available in
States that were previously granted
waivers of the requirement to conduct
evaluations under WIA. The commenter
also requested clarification on what
constitutes elements required to be
included in the assessments for the
other core programs.
Departments' Response: The
Departments agree and made a change
to the WIOA State Plan ICR as a result
of this comment. The previous 2 -year
period referenced in sec. 116 of WIOA
and in section III(b)( 4) of the WIOA
State Plan ICR should be implemented
for the first time at the 2 -year plan
modification cycle because assessments
of WIOA programs will not be available
before that time. Therefore, clarifying
language has been added.
Comments: Another commenter
requested the Departments to require
States to provide a description of a
clearly defined management reporting
structure for State merit staff.
Departments' Response: The
Departments decline to change the
WIOA State Plan ICR in response to this
comment because requiring a reporting
structure for merit staff imposes an
unnecessary burden on States. However,
States may elect to develop such a
policy and include it in its State Plan.
Comments: A commenter urged the
Departments to require that assessments
document how each program will
ensure not only physical accessibility
but programmatic accessibility,
including specific examples of how
WIOA sec. 188 regulations are being
met.
Departments' Response: The
Departments agree that compliance with
physical and programmatic accessibility
requirements is critical and have
required States to provide how this will
be achieved in section III(b)( 8) of the
WIOA State Plan ICR and through the
common assurances in section V.
Therefore, a change in the WIOA State
Plan ICR is not needed.
Comments: Another commenter
supported efforts to improve
coordination across programs and
recognized that integrated data systems
are an important step in achieving this
goal. However, the commenter was
concerned that achieving this goal will
be expensive and challenging for States
in light of State budget crises and
declining Federal resources. This
commenter proposed adding language
that clarifies that States are not required
to make such efforts.
Departments' Response: The
Departments decline to revise the WIOA
State Plan ICR not to require States to
make efforts to integrate data systems.
Under WIOA sec. 101( d)( 8), the State
WDB is required to assist the Governor
with " the development of strategies for
aligning technology and data systems
across one-stop partner programs to
enhance service delivery and improve
efficiencies in reporting on performance
accountability measures ( including the
design and implementation of common
intake, data collection, case
management information, and
performance accountability
measurement and reporting processes
and the incorporation of local input into
such design and implementation, to
improve coordination of services across
and underone-stop partner programs)"
WIOA sec. 102( b)( 2)( C)( v)(I), the State
Plan must explain " how the lead State
agencies with responsibility for the
administration of the core programs will
align and integrate available workforce
and education data on core programs,
unemployment insurance programs, and
education through postsecondary
education." Due to these statutory
requirements, States must develop a
plan for aligning and integrating data
systems.
Comments: A commenter indicated
that moving to true interoperability and
integration of data management systems
would likely require substantial outlays
of time and money that States may not
be able to meet, especially in a time of
level or declining Federal resources.
Departments' Response: The
Departments decline to change the
WIOA State Plan ICR in response to this
comment since WIOA requires States to
have a plan for aligning and integrating
data systems.
Comments: Another commenter said
that States should establish a reasonable
timeline for data alignment and
integration.
Departments' Response: The WIOA
State Plan ICR, as written, permits
States to establish a " reasonable
timeline" as part of their plans for
achieving data system alignment and
integration. Therefore, a change to the
collection is not needed.
Comments: The same commenter also
said the Departments and State Plans
should both report a single score for
each of the six performance indicators,
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but only after 4 years of WIOA
implementation.
Departments' Response: The
Departments decline to change the
WIOA State Plan ICR in response to this
comment. WIOA requires that each
State establish levels of performance for
each of the indicators of performance for
each of the programs.
Comments: A commenter suggested
that Veterans Priority of Service ( POS)
be addressed in the State Plan and that
POS should be required for service -
connected and non -service connected
disabilities.
Departments' Response: The
Departments decline to make the
requested change because the WIOA
State Plan ICR requires States to
describe how they implement Veterans
POS in their State ( see section III(b)( 7)).
Moreover, under 38 U.S. C. 4215, all
veterans, including disabled veterans
with both service and non -service
connected disabilities, receive POS for
all employment and training programs
funded in whole or in part by DOL.
Comments: A few commenters
requested clarification on the
Addressing the Accessibility of the One -
Stop Delivery System for Individuals
with Disabilities requirement in light of
a parenthetical sentence at the end of
the section indicating that this
requirement applies to core programs,
rather than the one-stop delivery system
partners referenced earlier in the
requirement.
Departments' Response: The
Departments make a change to section
III(b)( 8) of the WIOA State Plan ICR as
a result of the comment. The
Departments concur with the comment
that the parenthetical in the proposed
WIOA State Plan ICR could create
confusion about the requirements of
WIOA sec. 188 and so it was removed.
WIOA sec. 102( b)( 2)( C)( vii) requires that
the Unified State Plan contain a
description of how one-stop operators
and one-stop partners, in addition to
core programs, will comply with sec.
188 of WIOA and the applicable
provisions of the Americans with
Disabilities Act of 1990. Per WIOA sec.
103(b)( 1), this information must also be
included in any Combined State Plan.
Comments: Some commenters said
States should be required to describe the
methods used for joint planning and
coordination of the core programs, even
where the State opts to submit a Unified
State Plan rather than a Combined State
Plan.
Departments' Response: The
Departments concur that discussion of
coordination with core programs and
one-stop partners is helpful to ensure
successful joint planning and
coordination for both Unified and
Combined State Plans, rather than just
the Combined State Plan as had been
proposed. To that end, the Departments
added specific reference to the Unified
State Plan to section IV of the WIOA
State Plan ICR.
Comments: A few commenters said
the review and approval requirement
should be extended to all agencies or
entities with responsibility for
Combined State Plan partner programs.
Departments' Response: The
Departments maintain that the WIOA
State Plan ICR as written, and as
required by WIOA, provides all
programs the opportunity to review and
comment on the State Plan. WIOA does
not require Combined State Plan partner
programs to approve the Combined
State Plan prior to its submission.
Comments: A commenter said the
State Plan process should also include
the expertise and experience of partner
organizations that serve individuals
with barriers to employment because
they are important partners in the
public workforce system.
Departments' Response: The
Departments concur that the State Plan
process should include the expertise
and experience of partner organizations
that serve individuals with barriers to
employment because they are important
partners in the public workforce system.
To that end, the Departments have
added specific mention of organizations
serving individuals with barriers to
employment to the common assurances
in section V(4)( a) of the WIOA State
Plan ICR. As such, these organizations
are now specifically listed as being
among the stakeholders who should
have the opportunity to comment on the
Unified or Combined State Plan.
Comments: A commenter requested a
specific number of days for public
comment on the State Plan.
Departments' Response: The
Departments decline to set a number of
days for public comment because States
may use their own discretion in
providing a reasonable period of time
for public comment. Many States have
State laws or regulations that govern the
amount of time that must be provided
for public comment.
Comments: Another commenter
requested clarification on whether there
are cost limitations for contributions
and whether such contributions shall be
factored into infrastructure costs.
Departments' Response: The
Departments conclude that the
requested information is not appropriate
to the WIOA State Plan ICR so no
change was made. Further specifics on
infrastructure costs are provided in the
preamble for the Joint WIOA Final Rule
at part 678 and will be provided in
future joint guidance.
Comments: A commenter
recommended including explicit
reference to other people with barriers
to employment, including individuals
with disabilities, as well as clarification
that priority of service to veterans
remains in place.
Departments' Response: Section 3( 24)
of WIOA defines an " individual with a
barrier to employment," which includes
many different populations. Individuals
with disabilities are specifically
identified in sec. 3( 24)( D) of WIOA.
Given the exclusive list of populations
contained in that definition, there is no
statutory authority for the Departments
to add other populations to that
definition or to the WIOA State Plan
ICR. Requirements for priority of service
for veterans remain in place and are
covered in section III(b)( 7) of the WIOA
State Plan ICR.
Comments: Another commenter
recommended adding the following
Common Assurance: " The State will
negotiate in good faith with the Local
Boards its portion of the shared costs of
the one-stop system, in accordance with
WIOA sec. 121, on behalf of all one-stop
partners that are units of State
government."
Departments' Response: The
Departments decline to change the
WIOA State Plan ICR in response to this
comment. The Departments expect that
States will negotiate in good faith with
Local WDBs on one-stop cost sharing
without requiring an assurance that they
will do so.
Comments: A commenter said States
should be required to describe how they
will meet the statutory requirement to
use statewide funds to support local
areas by providing information on, and
support for, the effective development,
convening, and implementation of
industry or sector partnerships.
Departments' Response: The
Departments decline to change the
WIOA State Plan ICR in response to this
comment. Other areas of the State Plan
requirements provide adequate
information on how the State intends to
implement sector partnerships, and the
Departments have concluded it
appropriate to maintain the requirement
regarding use of statewide funds broad
enough for States to describe a number
of uses of those funds, required and
allowable.
Comments: Some commenters on 20
CFR 683. 130 of the DOL WIOA NPRM
were concerned with the Governor' s
approval of the adult -dislocated worker
funds transfer request and whether the
Governor would complete the request
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timely or would unreasonably deny a
request.
Departments' Response: The
Departments concur with the comment
and added a requirement to include
State -developed criteria for transferring
adult and dislocated worker funds in
the plan in order to provide process
transparency to local areas that may
request funds transfers.
Comments: A commenter
acknowledged the need to differentiate
training models enumerated in
paragraph (b)( 1) from apprenticeships,
but said the name " employer -based" is
more appropriate than the term
alternative" in reflecting the
widespread use of programs.
Departments' Response: The
Departments agree that the language in
section VI(b)( 1) of the WIOA State Plan
ICR, which governs program -specific
requirements for the adult and
dislocated worker programs, should
reflect more specifically the training
model, and have amended the
requirement to replace " alternative"
with " work -based" since " work -based"
more accurately captures the variety of
training models than " employer -based."
Comments: Another commenter
suggested requiring a policy on criteria
for selecting employers for work -based
training.
Departments' Response: The
Departments decline to change the
WIOA State Plan ICR in response to this
comment. Since the Departments
require States to address work -based
learning approaches, requiring a specific
policy on employer criteria is not
needed because the description of the
State' s approach will provide sufficient
information and also provide
information to stakeholders.
Comments: A commenter said it was
unclear whether the description of the
Training Provider Eligibility Procedure
was for initial eligibility, subsequent
eligibility, or both.
Departments' Response: The
Departments concur with the
commenter that the proposed language
was unclear. Therefore, the Departments
revised the program -specific
requirements in the WIOA State Plan
ICR under section VI in subsection (b)( 3)
for the adult and dislocated worker
programs to specify that the State must
provide its training provider eligibility
procedure for both initial and continued
eligibility.
Comments: A commenter asked if it is
the intent for the State to describe how
the State ensures that all 14 program
elements required under the youth
program are carried out, or some other
objective.
Departments' Response: The
Departments agree with the concern and
replaced the language in the WIOA State
Plan ICR under section VI in subsection
c)( 2), thereby offering more clarity.
Comments: Another commenter said
WIOA title I, subtitle B should be
expanded to include assurance that
States have a written publicly available
policy that ensures adult program funds
provide a priority in the delivery of
career and training services to
individuals who are basic skills
deficient.
Departments' Response: The
Departments concur that more
information on the implementation of
the priority in the use of adult funds for
training services and the individualized
career services outlined in WIOA sec.
134( c)( 2)( A)(xii) would be useful, and
have included a new requirement in the
WIOA State Plan ICR under section VI
in subsection (b)( 4) for the adult
program to describe how the State will
implement and monitor the priority of
service provisions for public assistance
recipients, other low-income
individuals, or individuals who are
basic skills deficient in accordance with
the requirements of WIOA sec.
134( c)( 3)( E), which applies to training
services and individualized career
services funded by the adult formula
program. However, the Departments did
not add a requirement that the policy be
made publicly available because the
State Plan is already required to be
made publicly available for comment.
Comments: A commenter submitted a
comment related to the priority for use
of adult funds stating that DOL should
require that State and local planning
efforts utilize the most current Census
and administrative data available to
develop estimates of each priority
service population in their planning
efforts, and update these data year to
year. The commenter stated that these
data should he utilized in Federal
reviews of State Plans to ensure that
system designs and projected
investments are equitably targeted to
service -priority populations and that
they should also be used to benchmark
system performance in actual
implementation of the priority for the
use of adult funds from year to year.
Departments' Response: The
Departments decline to change the
WIOA State Plan ICR in response to this
comment. The Departments maintain
that the priority for use of adult funds
can be made without the use of Census
data, and the approach suggested by the
commenter would be overly
burdensome for both State and Federal
staff.
Comments: Another commenter said
use of the term identification of UI
eligibility issues does not align with
language in WIOA, asserting that there
is a fundamental difference between
providing assistance in filing for
benefits and determining eligibility.
Departments' Response: The
Departments made a change to the
WIOA State Plan ICR in response to this
comment by adding " and referral to UI
staff for adjudication" to the WIOA
State Plan ICR under section VI in
subsection (a)(2) for the Wagner-Peyser
Act Employment Service program. The
Departments' intention with the
language referenced by the commenter
was not to de-emphasize reemployment
services, but rather to emphasize the
importance of enhanced connection
between UI and ES/ WIOA staff, and
reemphasize the importance of
providing reemployment services to UI
claimants and other unemployed
individuals. Both WIOA title I and the
Wagner-Peyser Act (as amended by
WIOA title III) contain new language
regarding how these programs may
provide services to UI claimants.
Comments: Numerous commenters
requested reintroducing the requirement
for SWAs to consult the NFJP grantees
as was required in the regulations at 20
CFR 653. 107( d).
Departments' Response: In response
to this comment, the Departments make
a change to the WIOA State Plan ICR
under section VI in subsection ( e)( 4) for
the Wagner-Peyser Act Employment
Service program because it will foster
greater collaboration between the SWAs
and the NFJP grantees.
Comments: A few commenters said
there appears to be no specific element
relating to integrated education and
training, as required under WIOA sec.
102(b)( 2)( D)(ii)(II)(dd), and
recommended that the instrument be
amended to include a requirement that
States describe how they will fund and
support such activities.
Departments' Response: Under
section VI of the WIOA State Plan ICR
for the AEFLA (title II) program, States
have an opportunity to describe in
subsection (b) how they will fund
eligible providers to establish or operate
adult education and literacy activities,
including integrated education and
training. The Departments make a small
clarification to the WIOA State Plan
ICR.
Comments: A commenter asked for
clarification on whether " eligible
agency" as used in the Aligning of
Content Standards section refers to
State agencies, Local WDBs, and/ or
adult education providers (WIOA,
AEFLA, etc.).
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Departments' Response: The
definition of " eligible agency" for the
AEFLA program is located in sec. 203( 3)
of WIOA.
Comments: A couple of commenters
provided input on section (d),
Integrated English Literacy and Civics
Education Program. A commenter
expressed concern that the language
used in the fourth paragraph of (d) fails
to acknowledge the populations
enrolled in integrated literacy and civics
education courses who are already
employed and working towards job
advancement and literacy gains. The
commenter stated that plans for program
design and success should include not
only job placement outcomes but also
job retention and advancement
measures. The other commenter said the
Departments should provide flexibility
for program operators to determine the
appropriate services to meet the needs
of individual participants, which may
not include workforce preparation and
training.
Departments' Response: The
Departments delete the paragraph and
move it to the AEFLA program
certifications and assurances section,
where the language outlining the two
requirements for design of Integrated
English Literacy and Civics Education
programs will remain included as part
of the assurance. This language
expresses the specific requirements for
design of these programs in sec.
243( c)( 1) and (2) of WIOA.
Comments: A commenter applauded
the attention that is given to reporting
coordination and collaboration between
State VR agencies and relevant entities,
specifically inter -agency and inter-
department cooperatives.
Departments' Response: No change to
the WIOA State Plan ICR is needed as
a result of this comment.
Comments: Another commenter
suggested that the State should describe
the manner in which the designated
State agency establishes cooperative
agreements with private non-profit VR
service providers. The same commenter
stated that the instrument should
include a reference to employers who
are Federal contractors to assist with
their compliance with Rehabilitation
Act sec. 503 and Vietnam Era Veterans'
Readjustment Assistance Act
VEVRAA). The same commenter also
stated that the instrument should
include a section under (j)( 1) for those
who are veterans with non -service -
connected disabilities on public
assistance. Lastly, the same commenter
stated that data should be disaggregated
by age and disability.
Departments' Response: The
Departments decline to change the
WIOA State Plan ICR in response to this
comment since only those elements
described in sec. 101( a) of the
Rehabilitation Act are required to be
included in the VR services portion of
the Unified or Combined State Plan.
Comments: A couple of commenters
expressed concern over whether States
will be able to meet current State Plan
submission deadlines. One commenter
expressed concern over limitations for
tracking client earnings in the 2nd and
4th quarter due to the lack of data
agreements at the Federal level. The
other commenter noted that some core
partners do not collect the information
needed to establish a reasonable
baseline of comparison and was
uncertain if the requested information
needed to complete the table will be
available in time to meet the State Plan
submission deadline.
Departments' Response: The
Departments make a change to the
WIOA State Plan ICR in response to
these comments by including specific
instructions for how to populate the
chart for the first 2 years of the plan to
account for a lack of data availability.
Comments: A commenter
recommended developing crosswalks of
substantially similar plan elements and
allowing States to respond to program -
specific elements through incorporation
by reference of responses to the
Combined State Plan.
Departments' Response: The
Departments decline to change the
WIOA State Plan ICR in response to this
comment. Although the Departments
agree that identical or similar plan
provisions relative to required and
optional Combined State Plan partner
programs may be " integrated" or
synthesized" together in the Combined
State Plan document, the Departments
decline to develop crosswalks of those
elements at this time. However, in
responding to a program -specific
requirement that may be duplicative of
an element addressed in other parts of
a Combined State Plan, a State may
clearly identify where it thinks it has
responded to the requirement in the
plan document. If the provision is not
so identified, then the Federal task of
reviewing the document and rendering
a decision on completeness may become
a major challenge and burdensome to
the State and Federal staff.
Comments: A joint submission from a
couple of commenters requested
clarification on the use of the term " the
State" as it pertains to the inclusion of
the Carl D. Perkins Career and Technical
Education Act in a Combined State
Plan, per the supplemental document
entitled, " Supplement to Workforce
Innovation and Opportunity Act -
program specific." The commenters
asserted that the document uses " the
State" in lieu of the statutorily required
term " the State eligible agency," at least
as it pertains to what entity is
responsible for the Perkins Act' s
participation in a Combined State Plan.
Departments' Response: The
Departments decline to change the
WIOA State Plan ICR in response to this
comment. The Departments were not
seeking comment on the program -
specific elements for the Perkins section
of the WIOA State Plan ICR since it is
a separately approved data collection.
Comments: A commenter referred to
the States' total estimated burden,
which is $ 141, 708, and noted that the
Federal burden is $240,987. The
commenter asserted that, unless the
141, 708 value of respondent time is for
each of the six core program
respondents, the estimated burden for
States to fulfill the program -specific
requirements for all six core programs
appears to be significantly
underestimated.
Departments' Response: The
Departments concur with the
commenter that the burden estimated
for the Federal review was overstated
relative to the State burden. After
further analysis of the burden estimate,
the Departments corrected a
mathematical error in item # 14 that
failed to annualize State Plan receipt as
was done for the State burden estimate.
Comments: Another commenter stated
that the WIOA State Plan ICR provides
a reasonable synthesis of the required
elements and provides States with
sufficient guidance, but certain elements
could be strengthened to ensure that
States and programs are moving towards
true alignment across programs.
Departments' Response: The
Departments decline to make a change
to the WIOA State Plan ICR because the
comment did not suggest one.
Comments: A commenter stated that
the draft instrument responds to many
of its concerns, but expressed continued
reservations that certain State Plan
elements may not truly reflect the
experiences of, or respond to the needs
of, individuals with disabilities.
Departments' Response: The
Departments decline to make a change
to the WIOA State Plan ICR in response
to the comment because the comment
did not suggest one.
Comments: Another commenter
commended the Departments'
collaboration on the instrument but also
urged the inclusion of entities that serve
individuals with barriers to
employment, including immigrants, in
outreach and technical assistance
efforts.
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Departments' Response: The
Departments decline to make a change
to the WIOA State Plan ICR in response
to the comment because the comment
did not suggest one.
Comments: A commenter appreciated
several elements of the WIOA
legislation (e.g., adding adult education
as a core program, the bill's emphasis on
college and career readiness) and
asserted that the need for additional
funding has never been greater.
Departments' Response: The
Departments decline to make a change
to the WIOA State Plan ICR in response
to the comment because the comment
did not suggest one.
Comments: Another commenter
opposed " the program" in general.
Departments' Response: The
Departments decline to make a change
to the WIOA State Plan ICR in response
to the comment because the comment
did not suggest one.
Comments: A commenter
recommended that certain pages of the
SCSEP component related to SCSEP
operations be deleted from the SCSEP
Combined State Plan requirements.
Departments' Response: The
Departments decline to change the
WIOA State Plan ICR in response to this
comment. The Departments are not
seeking comment on these data
elements since they are covered by a
separate collection number governing
the SCSEP data collection.
Comments: A comment that was
submitted through the NPRM stated that
the State Plan should require evidence -
based strategies as outlined in the Job -
Driven Training reports.
Departments' Response: The
Departments decline to change the
WIOA State Plan ICR in response to this
comment since the instrument already
reflects the content of the job -driven
report.
Comments: Another comment that
was submitted through the NPRM
recommended requiring States to
include in the State Plan how they will
use measurable skill gains and a list of
the measurable skill gains they will use.
Departments' Response: The
Departments decline to change the
WIOA State Plan ICR in response to this
comment since measurable skill gains
are addressed in the WIOA Joint
Performance ICR.
Comments: The final comment that
was submitted through the NPRM
requested guidance on the burden of
technology upgrades.
Departments' Response: The
Departments decline to change the
WIOA State Plan ICR in response to this
comment but will take it into account
for future guidance or technical
assistance.
To see a more detailed view of the
responses to public comments, refer to
item 8 of the supporting statements of
the information collections.
E. Executive Order 13132 (Federalism)
E. O. 13132 requires Federal agencies
to ensure that the principles of
Federalism established by the Framers
of our Constitution guide the executive
departments and agencies in the
formulation and implementation of
policies and to further the policies of
the Unfunded Mandates Reform Act.
Further, agencies must strictly adhere to
constitutional principles. Agencies must
closely examine the constitutional and
statutory authority supporting any
action that would limit the policy-
making discretion of the States and they
must carefully assess the necessity for
any such action. To the extent
practicable, State and local officials
must be consulted before any such
action is implemented. Section 3( b) of
the E. O. further provides that Federal
agencies must implement regulations
that have a substantial direct effect only
if statutory authority permits the
regulation and it is of national
significance. The Departments have
reviewed the Joint WIOA Final Rule in
light of these requirements and have
concluded that, with the enactment of
WIOA and its clear requirement to
publish national implementing
regulations, E. O. sec. 3( b) has been
reviewed and its requirement satisfied.
Accordingly, the Departments have
reviewed this WIOA-required Joint
Final Rule and have concluded that the
rulemaking has no Federalism
implications. The Joint WIOA Final
Rule, as noted above, has no substantial
direct effects on States, on the
relationships between the States, or on
the distribution of power and
responsibilities among the various
levels of government as described by
E. O. 13132. Therefore, the Departments
have concluded that this Final Rule
does not have a sufficient Federalism
implication to warrant the preparation
of a summary impact statement.
F. Unfunded Mandates Reform Act of
1995
Comments: In response to the NPRM,
the Departments received some
comments that addressed unfunded
mandates. A few commenters asserted
that the requirements to collect data and
to report performance are unfunded
mandates. One of the commenters
asserted that the cost in terms of time
and technology for integrating
individual records across multiple data
systems at the State level is very high.
Another one of the commenters
suggested that the rule included other
unfunded mandates, such as sub -
minimum wage tracking and pre-
employment transition services set -
asides. One commenter added that
although grant funding will be provided
by the Federal government, in some
States the grant funds provided for
implementation are insufficient to
reimburse the States.
Departments' Response: The
Departments acknowledge the
commenters' concerns and detail the
cost burden associated with this Joint
WIOA Final Rule in Section V.A
Rulemaking Analyses and Notices).
Grant funding is provided annually to
all programs authorized under WIOA
and that funding will be used to cover
the costs of implementing this rule.
With respect to the comments
pertaining to requirements under the VR
program for the VR agencies to report
data regarding individuals employed at
subminimum wage and for States to
reserve at least 15 percent of their VR
allotment to provide pre-employment
transition services to students with
disabilities, ED provides descriptions of
these cost burdens in the RIA of the VR
program -specific Final Rule published
elsewhere in this issue of the Federal
Register.
The Unfunded Mandates Reform Act
of 1995 directs agencies to assess the
effects of Federal regulatory actions on
State, local, and tribal governments, and
the private sector. A Federal mandate is
any provision in a regulation that
imposes an enforceable duty upon State,
local, or tribal governments, or imposes
a duty upon the private sector that is not
voluntary.
WIOA contains specific language
supporting employment and training
activities for Indian, Alaska Natives, and
Native Hawaiian individuals. These
program requirements are supported, as
is the WIOA workforce development
system generally, by Federal formula
grant funds and accordingly are not
considered unfunded mandates.
Similarly, Migrant and Seasonal
Farmworker activities are authorized
and funded under the WIOA program as
was done under the WIA program. The
States are mandated to perform certain
activities for the Federal government
under WIOA and will be reimbursed
grant funding) for the resources
required to perform those activities. The
same process and grant relationship
exists between States and Local WDBs
under the WIA program and must
continue under the WIOA program as
identified in this Final Rule.
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WIOA contains language -establishing
procedures regarding the eligibility of
training providers to receive funds
under the WIOA program and contains
clear State information collection
requirements for eligible training
providers ( e.g., submission of
appropriate, accurate, and timely
information). A decision by a private
training entity to participate as a
provider under the WIOA program is
purely voluntary and, therefore,
information collection burdens do not
impose a duty on the private sector that
is not voluntarily assumed.
Following consideration of these
factors, the Departments concluded that
the Joint WIOA Final Rule contained no
unfunded Federal mandates, which are
defined in 2 U.S. C. 658( 6) to include
either a " Federal intergovernmental
mandate" or a " Federal private sector
mandate."
G. Plain Language
E. O. 12866 and E. O. 13563 require
regulations to be written in a manner
that is easy to understand.
Comments: An individual had
difficulty understanding many of the
provisions of the proposal and said that
the definitions sounded like the " fine
print" of a contract.
Departments' Response: The overall
format of these WIOA regulations
reflects the Departments' commitment
to writing regulations that are reader -
friendly. The Departments have
attempted to make this Final Rule easy
to understand. For example, the
regulatory text is presented in a
question and answer" format and
organized consistent with WIOA. In
consideration of the foregoing, the
Departments have concluded that the
Departments have drafted this Joint
WIOA Final Rule in plain language.
H.Assessment of Federal Regulations
and Policies on Families
Section 654 of the Treasury and
General Government Appropriations
Act, enacted as part of the Omnibus
Consolidated and Emergency
Supplemental Appropriations Act of
1999 ( Pub. L. 105-277, 112 Stat. 2681)
requires the assessment of the impact of
this rule on family well-being. A rule
that is determined to have a negative
effect on families must be supported
with an adequate rationale. The
Departments have assessed this Joint
WIOA Final Rule in light of this
requirement and concluded that the
Joint Final Rule will not have a negative
effect on families.
I.Executive Order 13175 (Indian Tribal
Governments)
The Departments reviewed the Joint
WIOA Final Rule under the terms of
E. O. 13175 and DOL' s Tribal
Consultation Policy and have concluded
the final regulation would have tribal
implications as the final regulations
have substantial direct effects on one or
more Indian tribes, the relationship
between the Federal government and
Indian tribes, or the distribution of
power and responsibilities between the
Federal government and Indian tribes.
Therefore, as described in the preamble
to the NPRM, the Departments carried
out several consultations with tribal
institutions, including tribal officials,
which allowed the tribal officials to
provide meaningful and timely input
into the Departments' proposals.
Additionally, through the Notice and
Comment rulemaking process, the
Departments received comments on the
programs and provisions in WIOA that
have tribal implications and the
Departments have responded to these
comments throughout the preamble to
the Final Joint and DOL -only
regulations.
In addition to the comments received
through its Notice and Comment
rulemaking process, the Department of
Labor received feedback from the INA
community and the public prior to the
publication of the NPRM. This feedback
was summarized in the NPRM at 80 FR
20626-28.
J. Executive Order 12630 ( Government
Actions and Interference With
Constitutionally Protected Property
Rights)
The Departments have concluded that
this Joint WIOA Final Rule is not
subject to E. O. 12630, Governmental
Actions and Interference with
Constitutionally Protected Property
Rights, because it does not involve
implementation of a policy with takings
implications.
K. Executive Order 12988 ( Civil Justice
Reform)
This Joint WIOA Final Rule was
drafted and reviewed in accordance
with E. O. 12988, Civil Justice Reform,
and the Departments have concluded
that the Joint Final Rule will not unduly
burden the Federal court system. The
Joint WIOA Final Rule was written to
minimize litigation and, to the extent
feasible, provide a clear legal standard
for affected conduct. In addition, the
Joint WIOA Final Rule has been
reviewed to eliminate drafting errors
and ambiguities.
L. Executive Order 13211 ( Energy
Supply)
This Joint WIOA Final Rule was
drafted and reviewed in accordance
with E. O. 13211, Energy Supply. The
Departments have concluded the Joint
WIOA Final Rule will not have a
significant adverse effect on the supply,
distribution, or use of energy and is not
subject to E. O. 13211.
List of Subjects
20 CFR Parts 676, 677, and 678
Employment, Grant programs—labor.
34 CFR Part 361
Administrative practice and
procedure, Grant programs— education,
Grant programs— social programs,
Reporting and recordkeeping
requirements, Vocational rehabilitation.
34 CFR Part 463
Adult education, Grant programs—
education, Reporting and recordkeeping
requirements.
Department of Labor
Employment and Training
Administration
20 CFR Chapter V
For the reasons stated in the
preamble, ETA amends 20 CFR chapter
V as follows:
1. Add part 676 to read as follows:
PART 676— UNIFIED AND COMBINED
STATE PLANS UNDER TITLE I OF THE
WORKFORCE INNOVATION AND
OPPORTUNITY ACT
Sec.
676. 100 What are the purposes of the
Unified and Combined State Plans?
676. 105 What are the general requirements
for the Unified State Plan?
676. 110 What are the program -specific
requirements in the Unified State Plan
for the adult, dislocated worker, and
youth programs authorized under
Workforce Innovation and Opportunity
Act title I?
676. 115 What are the program -specific
requirements in the Unified State Plan
for the Adult Education and Family
Literacy Act program authorized under
Workforce Innovation and Opportunity
Act title II?
676. 120 What are the program -specific
requirements in the Unified State Plan
for the Employment Service program
authorized under the Wagner-Peyser Act,
as amended by Workforce Innovation
and Opportunity Act title III?
676. 125 What are the program -specific
requirements in the Unified State Plan
for the State Vocational Rehabilitation
program authorized under title I of the
Rehabilitation Act of 1973, as amended
by Workforce Innovation and
Opportunity Act title IV?
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676. 130 What is the development,
submission, and approval process of the
Unified State Plan?
676. 135 What are the requirements for
modification of the Itnified State Plan?
676. 140 What are the general requirements
for submitting a Combined State Plan?
676. 143 What is the development,
submission, and approval process of the
Combined State Plan?
676. 145 What are the requirements for
modifications of the Combined State
Plan?
Authority: Secs. 102, 103, and 503, Pub. L.
113- 128, 128 Stat. 1425 ( Jul. 22, 2014).
676.100 What are the purposes of the
Unified and Combined State Plans?
a) The Unified and Combined State
Plans provide the framework for States
to outline a strategic vision of, and goals
for, how their workforce development
systems will achieve the purposes of the
Workforce Innovation and Opportunity
Act (WIOA).
b) The Unified and Combined State
Plans serve as 4 -year action plans to
develop, align, and integrate the State' s
systems and provide a platform to
achieve the State' s vision and strategic
and operational goals. A Unified or
Combined State Plan is intended to:
1) Align, in strategic coordination,
the six core programs required in the
Unified State Plan pursuant to
676. 105(b), and additional Combined
State Plan partner programs that may be
part of the Combined State Plan
pursuant to § 676. 140;
2) Direct investments in economic,
education, and workforce training
programs to focus on providing relevant
education and training to ensure that
individuals, including youth and
individuals with barriers to
employment, have the skills to compete
in the job market and that employers
have a ready supply of skilled workers;
3) Apply strategies for job -driven
training consistently across Federal
programs; and
4) Enable economic, education, and
workforce partners to build a skilled
workforce through innovation in, and
alignment of, employment, training, and
education programs.
676.105 What are the general
requirements for the Unified State Plan?
a) The Unified State Plan must be
submitted in accordance with §676.130
and WIOA sec. 102( c), as explained in
joint planning guidelines issued by the
Secretaries of Labor and Education.
b) The Governor of each State must
submit, at a minimum, in accordance
with § 676. 130, a Unified State Plan to
the Secretary of Labor to be eligible to
receive funding for the workforce
development system' s six core
programs:
1) The adult, dislocated worker, and
youth programs authorized under
subtitle B of title I of WIOA and
administered by the U.S. Department of
Labor (DOL);
2) The Adult Education and Family
Literacy Act (AEFLA) program
authorized under title II of WIOA and
administered by the U.S. Department of
Education (ED);
3) The Employment Service program
authorized under the Wagner-Peyser Act
of 1933, as amended by WIOA title III
and administered by DOL; and
4) The Vocational Rehabilitation
program authorized under title I of the
Rehabilitation Act of 1973, as amended
by title IV of WIOA and administered by
ED.
c) The Unified State Plan must
outline the State' s 4 -year strategy for the
core programs described in paragraph
b) of this section and meet the
requirements of sec. 102( b) of WIOA, as
explained in the joint planning
guidelines issued by the Secretaries of
Labor and Education.
d) The Unified State Plan must
include strategic and operational
planning elements to facilitate the
development of an aligned, coordinated,
and comprehensive workforce
development system. The Unified State
Plan must include:
1) Strategic planning elements that
describe the State' s strategic vision and
goals for preparing an educated and
skilled workforce under sec. 102( b)( 1) of
WIOA. The strategic planning elements
must be informed by and include an
analysis of the State' s economic
conditions and employer and workforce
needs, including education and skill
needs.
2) Strategies for aligning the core
programs and Combined State Plan
partner programs as described in
676. 140( d), as well as other resources
available to the State, to achieve the
strategic vision and goals in accordance
with sec. 102( b)( 1)( E) of WIOA.
3) Operational planning elements in
accordance with sec. 102(b)( 2) of WIOA
that support the strategies for aligning
the core programs and other resources
available to the State to achieve the
State' s vision and goals and a
description of how the State Workforce
Development Board (WDB) will
implement its functions, in accordance
with sec. 101( d) of WIOA. Operational
planning elements must include:
i) A description of how the State
strategy will be implemented by each
core program' s lead State agency;
ii) State operating systems, including
data systems, and policies that will
support the implementation of the
State' s strategy identified in paragraph
d)( 1) of this section;
iii) Program -specific requirements for
the core programs required by WIOA
sec. 102( b)( 2)( D);
iv) Assurances required by sec.
102(b)( 2)( E) of WIOA, including an
assurance that the lead State agencies
responsible for the administration of the
core programs reviewed and commented
on the appropriate operational planning
of the Unified State Plan and approved
the elements as serving the needs of the
population served by such programs,
and other assurances deemed necessary
by the Secretaries of Labor and
Education under sec. 102(b)( 2)( E)(x) of
WIOA;
v) A description of joint planning
and coordination across core programs,
required one-stop partner programs, and
other programs and activities in the
Unified State Plan; and
vi) Any additional operational
planning requirements imposed by the
Secretary of Labor or the Secretary of
Education under sec. 102(b)( 2)( C)(viii)
of WIOA.
e) All of the requirements in this part
that apply to States also apply to
outlying areas.
676.110 What are the program -specific
requirements in the Unified State Plan for
the adult, dislocated worker, and youth
programs authorized under Workforce
Innovation and Opportunity Act title I?
The program -specific requirements for
the adult, dislocated worker, and youth
programs that must be included in the
Unified State Plan are described in sec.
102(b)( 2)( D) of WIOA. Additional
planning requirements may be
explained in joint planning guidelines
issued by the Secretaries of Labor and
Education.
676.115 What are the program -specific
requirements in the Unified State Plan for
the Adult Education and Family Literacy Act
program authorized under Workforce
Innovation and Opportunity Act title II?
The program -specific requirements for
the AEFLA program in title II that must
be included in the Unified State Plan
are described in secs. 102( b)( 2)( C) and
102( b)( 2)( D)( ii) of WIOA.
a) With regard to the description
required in sec. 102( b)( 2)( D)( ii)(I) of
WIOA pertaining to content standards,
the Unified State Plan must describe
how the eligible agency will, by July 1,
2016, align its content standards for
adult education with State -adopted
challenging academic content standards
under the Elementary and Secondary
Education Act of 1965, as amended.
b) With regard to the description
required in sec. 102( b)( 2)( C)( iv) of
WIOA pertaining to the methods and
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factors the State will use to distribute
funds under the core programs, for title
II of WIOA, the Unified State Plan must
include—
1) How the eligible agency will
award multi-year grants on a
competitive basis to eligible providers
in the State; and
2) How the eligible agency will
provide direct and equitable access to
funds using the same grant or contract
announcement and application
procedure.
676.120 What are the program -specific
requirements in the Unified State Plan for
the Employment Service program
authorized under the Wagner-Peyser Act, as
amended by Workforce Innovation and
Opportunity Act title III?
The Employment Service program
authorized under the Wagner-Peyser Act
of 1933, as amended by WIOA title III,
is subject to requirements in sec. 102( b)
of WIOA, including any additional
requirements imposed by the Secretary
of Labor under secs. 102(b)( 2)( C)(viii)
and 102( b)( 2)( D)( iv) of WIOA, as
explained in joint planning guidelines
issued by the Secretaries of Labor and
Education.
676.125 What are the program -specific
requirements in the Unified State Plan for
the State Vocational Rehabilitation program
authorized under title I of the Rehabilitation
Act of 1973, as amended by Workforce
Innovation and Opportunity Act title IV?
The program specific -requirements for
the vocational rehabilitation services
portion of the Unified or Combined
State Plan are set forth in sec. 101( a) of
the Rehabilitation Act of 1973, as
amended. All submission requirements
for the vocational rehabilitation services
portion of the Unified or Combined
State Plan are in addition to the jointly
developed strategic and operational
content requirements prescribed by sec.
102(b) of WIOA.
676.130 What is the development,
submission, and approval process of the
Unified State Plan?
a) The Unified State Plan described
in § 676. 105 must be submitted in
accordance with WIOA sec. 102( c), as
explained in joint planning guidelines
issued jointly by the Secretaries of Labor
and Education.
b) A State must submit its Unified
State Plan to the Secretary of Labor
pursuant to a process identified by the
Secretary.
1) The initial Unified State Plan must
be submitted no later than 120 days
prior to the commencement of the
second full program year of WIOA.
2) Subsequent Unified State Plans
must be submitted no later than 120
days prior to the end of the 4 -year
period covered by a preceding Unified
State Plan.
3) For purposes of paragraph (b) of
this section, " program year" means July
1 through June 30 of any year.
c) The Unified State Plan must be
developed with the assistance of the
State WDB, as required by § 679. 130( a)
of this chapter and WIOA sec. 101( d),
and must be developed in coordination
with administrators with optimum
policy-making authority for the core
programs and required one-stop
partners.
d) The State must provide an
opportunity for public comment on and
input into the development of the
Unified State Plan prior to its
submission.
1) The opportunity for public
comment must include an opportunity
for comment by representatives of Local
WDBs and chief elected officials,
businesses, representatives of labor
organizations, community-based
organizations, adult education
providers, institutions of higher
education, other stakeholders with an
interest in the services provided by the
six core programs, and the general
public, including individuals with
disabilities.
2) Consistent with the " Sunshine
Provision" of WIOA in sec. 101( g), the
State WDB must make information
regarding the Unified State Plan
available to the public through
electronic means and regularly
occurring open meetings in accordance
with State law. The Unified State Plan
must describe the State' s process and
timeline for ensuring a meaningful
opportunity for public comment.
e) Upon receipt of the Unified State
Plan from the State, the Secretary of
Labor will ensure that the entire Unified
State Plan is submitted to the Secretary
of Education pursuant to a process
developed by the Secretaries.
f) The Unified State Plan is subject to
the approval of both the Secretary of
Labor and the Secretary of Education.
g) Before the Secretaries of Labor and
Education approve the Unified State
Plan, the vocational rehabilitation
services portion of the Unified State
Plan described in WIOA sec.
102(b)(2)( D)(iii) must be approved by
the Commissioner of the Rehabilitation
Services Administration.
h) The Secretaries of Labor and
Education will review and approve the
Unified State Plan within 90 days of
receipt by the Secretary of Labor, unless
the Secretary of Labor or the Secretary
of Education determines in writing
within that period that:
1) The plan is inconsistent with a
core program' s requirements;
2) The Unified State Plan is
inconsistent with any requirement of
sec. 102 of WIOA; or
3) The plan is incomplete or
otherwise insufficient to determine
whether it is consistent with a core
program' s requirements or other
requirements of WIOA.
i) If neither the Secretary of Labor nor
the Secretary of Education makes the
written determination described in
paragraph (h) of this section within 90
days of the receipt by the Secretaries,
the Unified State Plan will be
considered approved.
676.135 What are the requirements for
modification of the Unified State Plan?
a) In addition to the required
modification review set forth in
paragraph (b) of this section, a Governor
may submit a modification of its Unified
State Plan at any time during the 4 -year
period of the plan.
b) Modifications are required, at a
minimum:
1) At the end of the first 2 -year
period of any 4 -year State Plan, wherein
the State WDB must review the Unified
State Plan, and the Governor must
submit modifications to the plan to
reflect changes in labor market and
economic conditions or other factors
affecting the implementation of the
Unified State Plan;
2) When changes in Federal or State
law or policy substantially affect the
strategies, goals, and priorities upon
which the Unified State Plan is based;
3) When there are changes in the
statewide vision, strategies, policies,
State negotiated levels of performance
as described in § 677.170(b) of this
chapter, the methodology used to
determine local allocation of funds,
reorganizations that change the working
relationship with system employees,
changes in organizational
responsibilities, changes to the
membership structure of the State WDB
or alternative entity, and similar
substantial changes to the State' s
workforce development system.
c) Modifications to the Unified State
Plan are subject to the same public
review and comment requirements in
676. 130( d) that apply to the
development of the original Unified
State Plan.
d) Unified State Plan modifications
must be approved by the Secretaries of
Labor and Education, based on the
approval standards applicable to the
original Unified State Plan under
676. 130. This approval must come
after the approval of the Commissioner
of the Rehabilitation Services
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Administration for modification of any
portion of the plan described in sec.
102(b)(2)( D)(iii) of WIOA.
676.140 What are the general
requirements for submitting a Combined
State Plan?
a) A State may choose to develop and
submit a 4 -year Combined State Plan in
lieu of the Unified State Plan described
in §§676.105 through 676.125.
b) A State that submits a Combined
State Plan covering an activity or
program described in paragraph (d) of
this section that is, in accordance with
WIOA sec. 103( c), approved or deemed
complete under the law relating to the
program will not be required to submit
any other plan or application in order to
receive Federal funds to carry out the
core programs or the program or
activities described under paragraph ( d)
of this section that are covered by the
Combined State Plan.
c) If a State develops a Combined
State Plan, it must be submitted in
accordance with the process described
in § 676. 143.
d) If a State chooses to submit a
Combined State Plan, the plan must
include the six core programs and one
or more of the Combined State Plan
partner programs and activities
described in sec. 103( a)( 2) of WIOA. The
Combined State Plan partner programs
and activities that may be included in
the Combined State Plan are:
1) Career and technical education
programs authorized under the Carl D.
Perkins Career and Technical Education
Act of 2006 ( 20 U. S. C. 2301 et seq.);
2) Temporary Assistance for Needy
Families or TANF, authorized under
part A of title IV of the Social Security
Act (42 U.S. C. 601 et seq.);
3) Employment and training
programs authorized under sec. 6( d)( 4)
of the Food and Nutrition Act of 2008
7 U.S. C. 2015( d)(4));
4) Work programs authorized under
sec. 6( o) of the Food and Nutrition Act
of 2008 ( 7 U.S. C. 2015( o));
5) Trade adjustment assistance
activities under chapter 2 of title II of
the Trade Act of 1974 ( 19 U. S. C. 2271
et seq.);
6) Services for veterans authorized
under chapter 41 of title 38 United
States Code;
7) Programs authorized under State
unemployment compensation laws (in
accordance with applicable Federal
law);
8) Senior Community Service
Employment Programs under title V of
the Older Americans Act of 1965 ( 42
U.S. C. 3056 et seq.);
9) Employment and training
activities carried out by the Department
of Housing and Urban Development
HUD);
10) Employment and training
activities carried out under the
Community Services Block Grant Act
42 U. S. C. 9901 et seq.); and
11) Reintegration of offenders
programs authorized under sec. 212 of
the Second Chance Act of 2007 ( 42
U. S. C. 17532).
e) A Combined State Plan must
contain:
1) For the core programs, the
information required by sec. 102( b) of
WIOA and §§ 676. 105 through 676. 125,
as explained in the joint planning
guidelines issued by the Secretaries;
2) For the Combined State Plan
partner programs and activities, except
as described in paragraph (h) of this
section, the information required by the
law authorizing and governing that
program to be submitted to the
appropriate Secretary, any other
applicable legal requirements, and any
common planning requirements
described in sec. 102( b) of WIOA, as
explained in the joint planning
guidelines issued by the Secretaries;
3) A description of the methods used
for joint planning and coordination
among the core programs, and with the
required one-stop partner programs and
other programs and activities included
in the State Plan; and
4) An assurance that all of the
entities responsible for planning or
administering the programs described in
the Combined State Plan have had a
meaningful opportunity to review and
comment on all portions of the plan.
f) Each Combined State Plan partner
program included in the Combined
State Plan remains subject to the
applicable program -specific
requirements of the Federal law and
regulations, and any other applicable
legal or program requirements,
governing the implementation and
operation of that program.
g) For purposes of §§676.140 through
676. 145 the term " appropriate
Secretary" means the head of the
Federal agency who exercises either
plan or application approval authority
for the program or activity under the
Federal law authorizing the program or
activity or, if there are no planning or
application requirements, who exercises
administrative authority over the
program or activity under that Federal
law.
h) States that include employment
and training activities carried out under
the Community Services Block Grant
CSBG) Act (42 U. S. C. 9901 et seq.)
under a Combined State Plan would
submit all other required elements of a
complete CSBG State Plan directly to
the Federal agency that administers the
program, according to the requirements
of Federal law and regulations.
i) States that submit employment and
training activities carried out by HUD
under a Combined State Plan would
submit any other required planning
documents for HUD programs directly
to HUD, according to the requirements
of Federal law and regulations.
676.143 What is the development,
submission, and approval process of the
Combined State Plan?
a) For purposes of § 676. 140( a), if a
State chooses to develop a Combined
State Plan it must submit the Combined
State Plan in accordance with the
requirements described below and sec.
103 of WIOA, as explained in the joint
planning guidelines issued by the
Secretaries of Labor and Education.
b) The Combined State Plan must be
developed with the assistance of the
State WDB, as required by § 679. 130( a)
of this chapter and WIOA sec. 101( d),
and must be developed in coordination
with administrators with optimum
policy-making authority for the core
programs and required one-stop
partners.
c) The State must provide an
opportunity for public comment on and
input into the development of the
Combined State Plan prior to its
submission.
1) The opportunity for public
comment for the portions of the
Combined State Plan that cover the core
programs must include an opportunity
for comment by representatives of Local
WDBs and chief elected officials,
businesses, representatives of labor
organizations, community-based
organizations, adult education
providers, institutions of higher
education, other stakeholders with an
interest in the services provided by the
six core programs, and the general
public, including individuals with
disabilities.
2) Consistent with the " Sunshine
Provision" of WIOA in sec. 101( g), the
State WDB must make information
regarding the Combined State Plan
available to the public through
electronic means and regularly
occurring open meetings in accordance
with State law. The Combined State
Plan must describe the State' s process
and timeline for ensuring a meaningful
opportunity for public comment on the
portions of the plan covering core
programs.
3) The portions of the plan that cover
the Combined State Plan partner
programs are subject to any public
comment requirements applicable to
those programs.
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d) The State must submit to the
Secretaries of Labor and Education and
to the Secretary of the agency with
responsibility for approving the
program' s plan or deeming it complete
under the law governing the program, as
part of its Combined State Plan, any
plan, application, form, or any other
similar document that is required as a
condition for the approval of Federal
funding under the applicable program
or activity. Such submission must occur
in accordance with a process identified
by the relevant Secretaries in paragraph
a) of this section.
e) The Combined State Plan will be
approved or disapproved in accordance
with the requirements of sec. 103( c) of
WIOA.
1) The portion of the Combined State
Plan covering programs administered by
the Departments of Labor and Education
must be reviewed, and approved or
disapproved, by the appropriate
Secretary within 90 days beginning on
the day the Combined State Plan is
received by the appropriate Secretary
from the State, consistent with
paragraph (f) of this section. Before the
Secretaries of Labor and Education
approve the Combined State Plan, the
vocational rehabilitation services
portion of the Combined State Plan
described in WIOA sec. 102( b)( 2)( D)( iii)
must be approved by the Commissioner
of the Rehabilitation Services
Administration.
2) If an appropriate Secretary other
than the Secretary of Labor or the
Secretary of Education has authority to
approve or deem complete a portion of
the Combined State Plan for a program
or activity described in § 676. 140( d),
that portion of the Combined State Plan
must be reviewed, and approved,
disapproved, or deemed complete, by
the appropriate Secretary within 120
days beginning on the day the
Combined State Plan is received by the
appropriate Secretary from the State
consistent with paragraph (f) of this
section.
f) The appropriate Secretaries will
review and approve or deem complete
the Combined State Plan within 90 or
120 days, as appropriate, as described in
paragraph (e) of this section, unless the
Secretaries of Labor and Education or
appropriate Secretary have determined
in writing within that period that:
1) The Combined State Plan is
inconsistent with the requirements of
the six core programs or the Federal
laws authorizing or applicable to the
program or activity involved, including
the criteria for approval of a plan or
application, or deeming the plan
complete, if any, under such law;
2) The portion of the Combined State
Plan describing the six core programs or
the program or activity described in
paragraph (a) of this section involved
does not satisfy the criteria as provided
in sec. 102 or 103 of WIOA, as
applicable; or
3) The Combined State Plan is
incomplete, or otherwise insufficient to
determine whether it is consistent with
a core program' s requirements, other
requirements of WIOA, or the Federal
laws authorizing, or applicable to, the
program or activity described in
676. 140( d), including the criteria for
approval of a plan or application, if any,
under such law.
g) If the Secretary of Labor, the
Secretary of Education, or the
appropriate Secretary does not make the
written determination described in
paragraph (f) of this section within the
relevant period of time after submission
of the Combined State Plan, that portion
of the Combined State Plan over which
the Secretary has jurisdiction will be
considered approved.
h) The Secretaries of Labor and
Education' s written determination of
approval or disapproval regarding the
portion of the plan for the six core
programs may be separate from the
written determination of approval,
disapproval, or completeness of the
program -specific requirements of
Combined State Plan partner programs
and activities described in § 676. 140( d)
and included in the Combined State
Plan.
i) Special rule. In paragraphs (f)(1)
and (3) of this section, the term " criteria
for approval of a plan or application,"
with respect to a State or a core program
or a program under the Carl D. Perkins
Career and Technical Education Act of
2006 ( 20 U. S. C. 2301 et seq.), includes
a requirement for agreement between
the State and the appropriate Secretaries
regarding State performance measures
or State performance accountability
measures, as the case may be, including
levels of performance.
676. 145 What are the requirements for
modifications of the Combined State Plan?
a) For the core program portions of
the Combined State Plan, modifications
are required, at a minimum:
1) By the end of the first 2 -year
period of any 4 -year State Plan. The
State WDB must review the Combined
State Plan, and the Governor must
submit modifications to the Combined
State Plan to reflect changes in labor
market and economic conditions or
other factors affecting the
implementation of the Combined State
Plan;
2) When changes in Federal or State
law or policy substantially affect the
strategies, goals, and priorities upon
which the Combined State Plan is
based;
3) When there are changes in the
statewide vision, strategies, policies,
State negotiated levels of performance
as described in § 677.170(b) of this
chapter, the methodology used to
determine local allocation of funds,
reorganizations that change the working
relationship with system employees,
changes in organizational
responsibilities, changes to the
membership structure of the State WDB
or alternative entity, and similar
substantial changes to the State' s
workforce development system.
b) In addition to the required
modification review described in
paragraph (a)( 1) of this section, a State
may submit a modification of its
Combined State Plan at any time during
the 4 -year period of the plan.
c) For any Combined State Plan
partner programs and activities
described in § 676. 140( d) that are
included in a State' s Combined State
Plan, the State—
1) May decide if the modification
requirements under WIOA sec. 102( c)( 3)
that apply to the core programs will
apply to the Combined State Plan
partner programs, as long as consistent
with any other modification
requirements for the programs, or may
comply with the requirements
applicable to only the particular
program or activity; and
2) Must submit, in accordance with
the procedure described in § 676. 143,
any modification, amendment, or
revision required by the Federal law
authorizing, or applicable to, the
Combined State Plan partner program or
activity.
i) If the underlying programmatic
requirements change ( e.g., the
authorizing statute is reauthorized) for
Federal laws authorizing such programs,
a State must either modify its Combined
State Plan or submit a separate plan to
the appropriate Federal agency in
accordance with the new Federal law
authorizing the Combined State Plan
partner program or activity and other
legal requirements applicable to such
program or activity.
ii) If the modification, amendment, or
revision affects the administration of
only that particular Combined State
Plan partner program and has no impact
on the Combined State Plan as a whole
or the integration and administration of
the core and other Combined State Plan
partner programs at the State level,
modifications must be submitted for
approval to only the appropriate
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Secretary, based on the approval
standards applicable to the original
Combined State Plan under § 676. 143, if
the State elects, or in accordance with
the procedures and requirements
applicable to the particular Combined
State Plan partner program.
3) A State also may amend its
Combined State Plan to add a Combined
State Plan partner program or activity
described in § 676. 140( d).
d) Modifications of the Combined
State Plan are subject to the same public
review and comment requirements that
apply to the development of the original
Combined State Plan as described in
676. 143( c) except that, if the
modification, amendment, or revision
affects the administration of a particular
Combined State Plan partner program
and has no impact on the Combined
State Plan as a whole or the integration
and administration of the core and other
Combined State Plan partner programs
at the State level, a State may comply
instead with the procedures and
requirements applicable to the
particular Combined State Plan partner
program.
e) Modifications for the core program
portions of the Combined State Plan
must be approved by the Secretaries of
Labor and Education, based on the
approval standards applicable to the
original Combined State Plan under
676. 143. This approval must come
after the approval of the Commissioner
of the Rehabilitation Services
Administration for modification of any
portion of the Combined State Plan
described in sec. 102(b)( 2)( D)(iii) of
WIOA.
2. Add part 677 to read as follows:
PART 677—PERFORMANCE
ACCOUNTABILITY UNDER TITLE I OF
THE WORKFORCE INNOVATION AND
OPPORTUNITY ACT
Sec.
677. 150 What definitions apply to
Workforce Innovation and Opportunity
Act performance accountability
provisions?
Subpart A—State Indicators of Performance
for Core Programs
677. 155 What are the primary indicators of
performance under the Workforce
Innovation and Opportunity Act?
677. 160 What information is required for
State performance reports?
677. 165 May a State establish additional
indicators of performance?
677. 170 How are State levels of
performance for primary indicators
established?
677. 175 What responsibility do States have
to use quarterly wage record information
for performance accountability?
Subpart B— Sanctions for State
Performance and the Provision of Technical
Assistance
677. 180 When is a State subject to a
financial sanction under the Workforce
Innovation and Opportunity Act?
677. 185 When are sanctions applied for a
State' s failure to submit an annual
performance report?
677. 190 When are sanctions applied for
failure to achieve adjusted levels of
performance?
677. 195 What should States expect when a
sanction is applied to the Governor' s
Reserve Allotment?
677. 200 What other administrative actions
will be applied to States' performance
requirements?
Subpart C— Local Performance
Accountability for Workforce Innovation
and Opportunity Act Title I Programs
677. 205 What performance indicators apply
to local areas and what information must
be included in local area performance
reports?
677. 210 How are local performance levels
established?
Subpart D— Incentives and Sanctions for
Local Performance for Workforce
Innovation and Opportunity Act Title I
Programs
677. 215 Under what circumstances are
local areas eligible for State Incentive
Grants?
677. 220 Under what circumstances may a
corrective action or sanction be applied
to local areas for poor performance?
677. 225 Under what circumstances may
local areas appeal a reorganization plan?
Subpart E— Eligible Training Provider
Performance for Workforce Innovation and
Opportunity Act Title I Programs
677. 230 What information is required for
the eligible training provider
performance reports?
Subpart F— Performance Reporting
Administrative Requirements
677. 235 What are the reporting
requirements for individual records for
core Workforce Innovation and
Opportunity Act (WIOA) title I programs;
the Wagner-Peyser Act Employment
Service program, as amended by WIOA
title III; and the Vocational
Rehabilitation program authorized under
title I of the Rehabilitation Act of 1973,
as amended by WIOA title IV?
677. 240 What are the requirements for data
validation of State annual performance
reports?
Authority: Secs. 116, 189, and 503 of Pub.
L. 113- 128, 128 Stat. 1425 (Jul. 22, 2014).
677. 150 What definitions apply to
Workforce Innovation and Opportunity Act
performance accountability provisions?
a) Participant. A reportable
individual who has received services
other than the services described in
paragraph (a)( 3) of this section, after
satisfying all applicable programmatic
requirements for the provision of
services, such as eligibility
determination.
1) For the Vocational Rehabilitation
VR) program, a participant is a
reportable individual who has an
approved and signed Individualized
Plan for Employment (IPE) and has
begun to receive services.
2) For the Workforce Innovation and
Opportunity Act (WIOA) title I youth
program, a participant is a reportable
individual who has satisfied all
applicable program requirements for the
provision of services, including
eligibility determination, an objective
assessment, and development of an
individual service strategy, and received
1 of the 14 WIOA youth program
elements identified in sec. 129( c)( 2) of
WIOA.
3) The following individuals are not
participants:
i) Individuals in an Adult Education
and Family Literacy Act (AEFLA)
program who have not completed at
least 12 contact hours;
ii) Individuals who only use the self-
service system.
A) Subject to paragraph (a)( 3)( ii)(B) of
this section, self-service occurs when
individuals independently access any
workforce development system
program' s information and activities in
either a physical location, such as a one-
stop center resource room or partner
agency, or remotely via the use of
electronic technologies.
B) Self-service does not uniformly
apply to all virtually accessed services.
For example, virtually accessed services
that provide a level of support beyond
independent job or information seeking
on the part of an individual would not
qualify as self-service.
iii) Individuals who receive
information -only services or activities,
which provide readily available
information that does not require an
assessment by a staff member of the
individual' s skills, education, or career
objectives.
4) Programs must include
participants in their performance
calculations.
b) Reportable individual. An
individual who has taken action that
demonstrates an intent to use program
services and who meets specific
reporting criteria of the program,
including:
1) Individuals who provide
identifying information;
2) Individuals who only use the self-
service system; or
3) Individuals who only receive
information -only services or activities.
c) Exit. As defined for the purpose of
performance calculations, exit is the
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point after which a participant who has
received services through any program
meets the following criteria:
1) For the adult, dislocated worker,
and youth programs authorized under
WIOA title I, the AEFLA program
authorized under WIOA title II, and the
Employment Service program
authorized under the Wagner-Peyser
Act, as amended by WIOA title III, exit
date is the last date of service.
i) The last day of service cannot be
determined until at least 90 days have
elapsed since the participant last
received services; services do not
include self-service, information -only
services or activities, or follow-up
services. This also requires that there
are no plans to provide the participant
with future services.
ii) [Reserved].
2)( i) For the VR program authorized
under title I of the Rehabilitation Act of
1973, as amended by WIOA title IV (VR
program):
A) The participant' s record of service
is closed in accordance with 34 CFR
361. 56 because the participant has
achieved an employment outcome; or
B) The participant' s service record is
closed because the individual has not
achieved an employment outcome or
the individual has been determined
ineligible after receiving services in
accordance with 34 CFR 361. 43.
ii) Notwithstanding any other
provision of this section, a participant
will not be considered as meeting the
definition of exit from the VR program
if the participant' s service record is
closed because the participant has
achieved a supported employment
outcome in an integrated setting but not
in competitive integrated employment.
3)( i) A State may implement a
common exit policy for all or some of
the core programs in WIOA title I and
the Employment Service program
authorized under the Wagner-Peyser
Act, as amended by WIOA title III, and
any additional required partner
program( s) listed in sec. 121( b)( 1)( B) of
WIOA that is under the authority of the
U.S. Department of Labor (DOL).
ii) If a State chooses to implement a
common exit policy, the policy must
require that a participant is exited only
when all of the criteria in paragraph
c)( 1) of this section are met for the
WIOA title I core programs and the
Employment Service program
authorized under the Wagner-Peyser
Act, as amended by WIOA title III, as
well as any additional required partner
programs listed in sec. 121( b)( 1)( B) of
WIOA under the authority of DOL to
which the common exit policy applies
in which the participant is enrolled.
d) State. For purposes of this part,
other than in regard to sanctions or the
statistical adjustment model, all
references to " State" include the
outlying areas of American Samoa,
Guam, Commonwealth of the Northern
Mariana Islands, the U. S. Virgin Islands,
and, as applicable, the Republic of
Palau.
Subpart A—State Indicators of
Performance for Core Programs
677. 155 What are the primary indicators
of performance under the Workforce
Innovation and Opportunity Act?
a) All States submitting either a
Unified or Combined State Plan under
676. 130 and 676. 143 of this chapter,
must propose expected levels of
performance for each of the primary
indicators of performance for the adult,
dislocated worker, and youth programs
authorized under WIOA title I; the
AEFLA program authorized under
WIOA title II; the Employment Service
program authorized under the Wagner-
Peyser Act, as amended by WIOA title
III; and the VR program authorized
under title I of the Rehabilitation Act of
1973, as amended by WIOA title IV.
1) Primary indicators ofperformance.
The six primary indicators of
performance for the adult and
dislocated worker programs, the AEFLA
program, and the VR program are:
i) The percentage of participants who
are in unsubsidized employment during
the second quarter after exit from the
program;
ii) The percentage of participants
who are in unsubsidized employment
during the fourth quarter after exit from
the program;
iii) Median earnings of participants
who are in unsubsidized employment
during the second quarter after exit from
the program;
iv)(A) The percentage of those
participants enrolled in an education or
training program (excluding those in on-
the-job training [OJT] and customized
training) who attained a recognized
postsecondary credential or a secondary
school diploma, or its recognized
equivalent, during participation in or
within 1 year after exit from the
program.
B) A participant who has attained a
secondary school diploma or its
recognized equivalent is included in the
percentage of participants who have
attained a secondary school diploma or
recognized equivalent only if the
participant also is employed or is
enrolled in an education or training
program leading to a recognized
postsecondary credential within 1 year
after exit from the program;
v) The percentage of participants
who, during a program year, are in an
education or training program that leads
to a recognized postsecondary
credential or employment and who are
achieving measurable skill gains,
defined as documented academic,
technical, occupational, or other forms
of progress, towards such a credential or
employment. Depending upon the type
of education or training program,
documented progress is defined as one
of the following:
A) Documented achievement of at
least one educational functioning level
of a participant who is receiving
instruction below the postsecondary
education level;
B) Documented attainment of a
secondary school diploma or its
recognized equivalent;
C) Secondary or postsecondary
transcript or report card for a sufficient
number of credit hours that shows a
participant is meeting the State unit' s
academic standards;
D) Satisfactory or better progress
report, towards established milestones,
such as completion of OJT or
completion of 1 year of an
apprenticeship program or similar
milestones, from an employer or
training provider who is providing
training; or
E) Successful passage of an exam that
is required for a particular occupation or
progress in attaining technical or
occupational skills as evidenced by
trade -related benchmarks such as
knowledge-based exams.
vi) Effectiveness in serving
employers.
2) Participants. For purposes of the
primary indicators of performance in
paragraph (a)( 1) of this section,
participant" will have the meaning
given to it in § 677. 150( a), except that—
i) For purposes of determining
program performance levels under
indicators set forth in paragraphs
a)( 1)( i) through (iv) and (vi) of this
section, a " participant" does not
include a participant who received
services under sec. 225 of WIOA and
exits such program while still in a
correctional institution as defined in
sec. 225( e)( 1) of WIOA; and
ii) The Secretaries of Labor and
Education may, as needed and
consistent with the Paperwork
Reduction Act (PRA), make further
determinations as to the participants to
be included in calculating program
performance levels for purposes of any
of the performance indicators set forth
in paragraph ( a)( 1) of this section.
b) The primary indicators in
paragraphs ( a)( 1)( i) through (iii) and (vi)
of this section apply to the Employment
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Service program authorized under the
Wagner-Peyser Act, as amended by
WIOA title III.
c) For the youth program authorized
under WIOA title I, the primary
indicators are:
1) Percentage of participants who are
in education or training activities, or in
unsubsidized employment, during the
second quarter after exit from the
program;
2) Percentage of participants in
education or training activities, or in
unsubsidized employment, during the
fourth quarter after exit from the
program;
3) Median earnings of participants
who are in unsubsidized employment
during the second quarter after exit from
the program;
4) The percentage of those
participants enrolled in an education or
training program (excluding those in
OJT and customized training) who
obtained a recognized postsecondary
credential or a secondary school
diploma, or its recognized equivalent,
during participation in or within 1 year
after exit from the program, except that
a participant who has attained a
secondary school diploma or its
recognized equivalent is included as
having attained a secondary school
diploma or recognized equivalent only
if the participant is also employed or is
enrolled in an education or training
program leading to a recognized
postsecondary credential within 1 year
from program exit;
5) The percentage of participants
who during a program year, are in an
education or training program that leads
to a recognized postsecondary
credential or employment and who are
achieving measurable skill gains,
defined as documented academic,
technical, occupational or other forms of
progress towards such a credential or
employment. Depending upon the type
of education or training program,
documented progress is defined as one
of the following:
i) Documented achievement of at
least one educational functioning level
of a participant who is receiving
instruction below the postsecondary
education level;
ii) Documented attainment of a
secondary school diploma or its
recognized equivalent;
iii) Secondary or postsecondary
transcript or report card for a sufficient
number of credit hours that shows a
participant is achieving the State unit' s
academic standards;
iv) Satisfactory or better progress
report, towards established milestones,
such as completion of OJT or
completion of 1 year of an
apprenticeship program or similar
milestones, from an employer or
training provider who is providing
training; or
v) Successful passage of an exam that
is required for a particular occupation or
progress in attaining technical or
occupational skills as evidenced by
trade -related benchmarks such as
knowledge-based exams.
6) Effectiveness in serving employers.
677. 160 What information is required for
State performance reports?
a) The State performance report
required by sec. 116( d)( 2) of WIOA must
be submitted annually using a template
the Departments of Labor and Education
will disseminate, and must provide, at
a minimum, information on the actual
performance levels achieved consistent
with §677.175 with respect to:
1) The total number of participants
served, and the total number of
participants who exited each of the core
programs identified in sec.
116(b)( 3)( A)(ii) of WIOA, including
disaggregated counts of those who
participated in and exited a core
program, by:
i) Individuals with barriers to
employment as defined in WIOA sec.
3( 24); and
ii) Co -enrollment in any of the
programs in WIOA sec. 116(b)( 3)( A)(ii).
2) Information on the performance
levels achieved for the primary
indicators of performance for all of the
core programs identified in § 677. 155
including disaggregated levels for:
i) Individuals with barriers to
employment as defined in WIOA sec.
3( 24);
ii) Age;
iii) Sex; and
iv) Race and ethnicity.
3) The total number of participants
who received career services and the
total number of participants who exited
from career services for the most recent
program year and the 3 preceding
program years, and the total number of
participants who received training
services and the total number of
participants who exited from training
services for the most recent program
year and the 3 preceding program years,
as applicable to the program;
4) Information on the performance
levels achieved for the primary
indicators of performance consistent
with §677. 155 for career services and
training services for the most recent
program year and the 3 preceding
program years, as applicable to the
program;
5) The percentage of participants in
a program who attained unsubsidized
employment related to the training
received (often referred to as training -
related employment) through WIOA
title I, subtitle B programs;
6) The amount of funds spent on
career services and the amount of funds
spent on training services for the most
recent program year and the 3 preceding
program years, as applicable to the
program;
7) The average cost per participant
for those participants who received
career services and training services,
respectively, during the most recent
program year and the 3 preceding
program years, as applicable to the
program;
8) The percentage of a State' s annual
allotment under WIOA sec. 132(b) that
the State spent on administrative costs;
and
9) Information that facilitates
comparisons of programs with programs
in other States.
10) For WIOA title I programs, a State
performance narrative, which, for States
in which a local area is implementing a
pay -for -performance contracting
strategy, at a minimum provides:
i) A description of pay -for -
performance contract strategies being
used for programs;
ii) The performance of service
providers entering into contracts for
such strategies, measured against the
levels of performance specified in the
contracts for such strategies; and
iii) An evaluation of the design of the
programs and performance strategies
and, when available, the satisfaction of
employers and participants who
received services under such strategies.
b) The disaggregation of data for the
State performance report must be done
in compliance with WIOA sec.
116( d)( 6)( C).
c) The State performance reports
must include a mechanism of electronic
access to the State' s local area and
eligible training provider (ETP)
performance reports.
d) States must comply with these
requirements from sec. 116 of WIOA as
explained in joint guidance issued by
the Departments of Labor and
Education, which may include
information on reportable individuals as
determined by the Secretaries of Labor
and Education.
677.165 May a State establish additional
indicators of performance?
States may identify additional
indicators of performance for the six
core programs. If a State does so, these
indicators must be included in the
Unified or Combined State Plan.
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677.170 How are State levels of
performance for primary indicators
established?
a) A State must submit in the State
Plan expected levels of performance on
the primary indicators of performance
for each core program as required by
sec. 116( b)( 3)( A)(iii) of WIOA as
explained in joint guidance issued by
the Secretaries of Labor and Education.
1) The initial State Plan submitted
under WIOA must contain expected
levels of performance for the first 2
years of the State Plan.
2) States must submit expected levels
of performance for the third and fourth
year of the State Plan before the third
program year consistent with §§676. 135
and 676. 145 of this chapter.
b) States must reach agreement on
levels of performance with the
Secretaries of Labor and Education for
each indicator for each core program.
These are the negotiated levels of
performance. The negotiated levels must
be based on the following factors:
1) How the negotiated levels of
performance compare with State levels
of performance established for other
States;
2) The application of an objective
statistical model established by the
Secretaries of Labor and Education,
subject to paragraph (d) of this section;
3) How the negotiated levels promote
continuous improvement in
performance based on the primary
indicators and ensure optimal return on
investment of Federal funds; and
4) The extent to which the negotiated
levels assist the State in meeting the
performance goals established by the
Secretaries of Labor and Education for
the core programs in accordance with
the Government Performance and
Results Act of 1993, as amended.
c) An objective statistical adjustment
model will be developed and
disseminated by the Secretaries of Labor
and Education. The model will he based
on:
1) Differences among States in actual
economic conditions, including but not
limited to unemployment rates and job
losses or gains in particular industries;
and
2) The characteristics of participants,
including but not limited to:
i) Indicators of poor work history;
ii) Lack of work experience;
iii) Lack of educational or
occupational skills attainment;
iv) Dislocation from high -wage and
high -benefit employment;
v) Low levels of literacy;
vi) Low levels of English proficiency;
vii) Disability status;
viii) Homelessness;
ix) Ex -offender status; and
x) Welfare dependency.
d) The objective statistical
adjustment model developed under
paragraph (c) of this section will be:
1) Applied to the core programs'
primary indicators upon availability of
data which are necessary to populate
the model and apply the model to the
local core programs;
2) Subject to paragraph (d)( 1) of this
section, used before the beginning of a
program year in order to reach
agreement on State negotiated levels for
the upcoming program year; and
3) Subject to paragraph (d)( 1) of this
section, used to revise negotiated levels
at the end of a program year based on
actual economic conditions and
characteristics of participants served,
consistent with sec. 116(b)( 3)( A)(vii) of
WIOA.
e) The negotiated levels revised at the
end of the program year, based on the
statistical adjustment model, are the
adjusted levels of performance.
f) States must comply with these
requirements from sec. 116 of WIOA as
explained in joint guidance issued by
the Departments of Labor and
Education.
677. 175 What responsibility do States
have to use quarterly wage record
information for performance
accountability?
a)( 1) States must, consistent with
State laws, use quarterly wage record
information in measuring a State' s
performance on the primary indicators
of performance outlined in § 677. 155
and a local area' s performance on the
primary indicators of performance
identified in § 677. 205.
2) The use of social security numbers
from participants and such other
information as is necessary to measure
the progress of those participants
through quarterly wage record
information is authorized.
3) To the extent that quarterly wage
records are not available for a
participant, States may use other
information as is necessary to measure
the progress of those participants
through methods other than quarterly
wage record information.
b) " Quarterly wage record
information" means intrastate and
interstate wages paid to an individual,
the social security number (or numbers,
if more than one) of the individual, and
the name, address, State, and the
Federal employer identification number
of the employer paying the wages to the
individual.
c) The Governor may designate a
State agency (or appropriate State
entity) to assist in carrying out the
performance reporting requirements for
WIOA core programs and ETPs. The
Governor or such agency (or appropriate
State entity) is responsible for:
1) Facilitating data matches;
2) Data quality reliability; and
3) Protection against disaggregation
that would violate applicable privacy
standards.
Subpart B— Sanctions for State
Performance and the Provision of
Technical Assistance
677.180 When is a State subject to a
financial sanction under the Workforce
Innovation and Opportunity Act?
A State will be subject to financial
sanction under WIOA sec. 116(f) if it
fails to:
a) Submit the State annual
performance report required under
WIOA sec. 116(d)(2); or
b) Meet adjusted levels of
performance for the primary indicators
of performance in accordance with sec.
116( f) of WIOA.
677.185 When are sanctions applied for
a State' s failure to submit an annual
performance report?
a) Sanctions will be applied when a
State fails to submit the State annual
performance report required under sec.
116( d)( 2) of WIOA. A State fails to
report if the State either:
1) Does not submit a State annual
performance report by the date for
timely submission set in performance
reporting guidance; or
2) Submits a State annual
performance report by the date for
timely submission, but the report is
incomplete.
b) Sanctions will not be applied if the
reporting failure is due to exceptional
circumstances outside of the State' s
control. Exceptional circumstances may
include, but are not limited to:
1) Natural disasters;
2) Unexpected personnel transitions;
and
3) Unexpected technology related
issues.
c) In the event that a State may not
be able to submit a complete and
accurate performance report by the
deadline for timely reporting:
1) The State must notify the Secretary
of Labor or Secretary of Education as
soon as possible, but no later than 30
days prior to the established deadline
for submission, of a potential impact on
the State' s ability to submit its State
annual performance report in order to
not be considered failing to report.
2) In circumstances where
unexpected events occur less than 30
days before the established deadline for
submission of the State annual
performance reports, the Secretaries of
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Labor and Education will review
requests for extending the reporting
deadline in accordance with the
Departments of Labor and Education' s
procedures that will be established in
guidance.
677.190 When are sanctions applied for
failure to achieve adjusted levels of
performance?
a) States' negotiated levels of
performance will be adjusted through
the application of the statistical
adjustment model established under
677. 170 to account for actual
economic conditions experienced
during a program year and
characteristics of participants, annually
at the close of each program year.
b) Any State that fails to meet
adjusted levels of performance for the
primary indicators of performance
outlined in § 677. 155 for any year will
receive technical assistance, including
assistance in the development of a
performance improvement plan
provided by the Secretary of Labor or
Secretary of Education.
c) Whether a State has failed to meet
adjusted levels of performance will be
determined using the following three
criteria:
1) The overall State program score,
which is expressed as the percent
achieved, compares the actual results
achieved by a core program on the
primary indicators of performance to the
adjusted levels of performance for that
core program. The average of the
percentages achieved of the adjusted
level of performance for each of the
primary indicators by a core program
will constitute the overall State program
score.
2) However, until all indicators for
the core program have at least 2 years
of complete data, the overall State
program score will be based on a
comparison of the actual results
achieved to the adjusted level of
performance for each of the primary
indicators that have at least 2 years of
complete data for that program;
3) The overall State indicator score,
which is expressed as the percent
achieved, compares the actual results
achieved on a primary indicator of
performance by all core programs in a
State to the adjusted levels of
performance for that primary indicator.
The average of the percentages achieved
of the adjusted level of performance by
all of the core programs on that
indicator will constitute the overall
State indicator score.
4) However, until all indicators for
the State have at least 2 years of
complete data, the overall State
indicator score will be based on a
comparison of the actual results
achieved to the adjusted level of
performance for each of the primary
indicators that have at least 2 years of
complete data in a State.
5) The individual indicator score,
which is expressed as the percent
achieved, compares the actual results
achieved by each core program on each
of the individual primary indicators to
the adjusted levels of performance for
each of the program' s primary indicators
of performance.
d) A performance failure occurs
when:
1) Any overall State program score or
overall State indicator score falls below
90 percent for the program year; or
2) Any of the States' individual
indicator scores fall below 50 percent
for the program year.
e) Sanctions based on performance
failure will be applied to States if, for 2
consecutive years, the State fails to
meet:
1) 90 percent of the overall State
program score for the same core
program;
2) 90 percent of the overall State
indicator score for the same primary
indicator; or
3) 50 percent of the same indicator
score for the same program.
677. 195 What should States expect when
a sanction is applied to the Governor' s
Reserve Allotment?
a) The Secretaries of Labor and
Education will reduce the Governor' s
Reserve Allotment by five percent of the
maximum available amount for the
immediately succeeding program year
if:
1) The State fails to submit the State
annual performance reports as required
under WIOA sec. 116( d)( 2), as defined
in § 677. 185;
2) The State fails to meet State
adjusted levels of performance for the
same primary performance indicator(s)
under either § 677. 190( d)( 1) for the
second consecutive year as defined in
677. 190; or
3) The State' s score on the same
indicator for the same program falls
below 50 percent under § 677. 190( d)( 2)
for the second consecutive year as
defined in § 677. 190.
b) If the State fails under paragraphs
a)( 1) and either (a)( 2) or ( 3) of this
section in the same program year, the
Secretaries of Labor and Education will
reduce the Governor' s Reserve
Allotment by 10 percent of the
maximum available amount for the
immediately succeeding program year.
c) If a State' s Governor' s Reserve
Allotment is reduced:
1) The reduced amount will not be
returned to the State in the event that
the State later improves performance or
submits its annual performance report;
and
2) The Governor' s Reserve will
continue to be set at the reduced level
in each subsequent year until the
Secretary of Labor or the Secretary of
Education, depending on which
program is impacted, determines that
the State met the State adjusted levels
of performance for the applicable
primary performance indicators and has
submitted all of the required
performance reports.
d) A State may request review of a
sanction the Secretary of Labor imposes
in accordance with the provisions of
683. 800 of this chapter.
677.200 What other administrative
actions will be applied to States'
performance requirements?
a) In addition to sanctions for failure
to report or failure to meet adjusted
levels of performance, States will be
subject to administrative actions in the
case of poor performance.
b) States' performance achievement
on the individual primary indicators
will be assessed in addition to the
overall State program score and overall
State indicator score. Based on this
assessment, as clarified and explained
in guidance, for performance on any
individual primary indicator, the
Secretary of Labor or the Secretary of
Education will require the State to
establish a performance risk plan to
address continuous improvement on the
individual primary indicator.
Subpart C— Local Performance
Accountability for Workforce
Innovation and Opportunity Act Title I
Programs
677.205 What performance indicators
apply to local areas and what information
must be included in local area performance
reports?
a) Each local area in a State under
WIOA title I is subject to the same
primary indicators of performance for
the core programs for WIOA title I under
677. 155( a)( 1) and (c) that apply to the
State.
b) In addition to the indicators
described in paragraph (a) of this
section, under § 677. 165, the Governor
may apply additional indicators of
performance to local areas in the State.
c) States must annually make local
area performance reports available to
the public using a template that the
Departments of Labor and Education
will disseminate in guidance, including
by electronic means. The State must
provide electronic access to the public
local area performance report in its
annual State performance report.
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d) The local area performance report
must include:
1) The actual results achieved under
677. 155 and the information required
under § 677. 160( a);
2) The percentage of a local area' s
allotment under WIOA secs. 128(b) and
133(b) that the local area spent on
administrative costs; and
3) Other information that facilitates
comparisons of programs with programs
in other local areas ( or planning regions
if the local area is part of a planning
region).
e) The disaggregation of data for the
local area performance report must be
done in compliance with WIOA sec.
116( d)( 6)( C).
f) States must comply with any
requirements from sec. 116(d)( 3) of
WIOA as explained in guidance,
including the use of the performance
reporting template, issued by DOL.
677.210 How are local performance
levels established?
a) The objective statistical adjustment
model required under sec.
116(b)( 3)( A)(viii) of WIOA and
described in § 677. 170( c) must be:
1) Applied to the core programs'
primary indicators upon availability of
data which are necessary to populate
the model and apply the model to the
local core programs;
2) Used in order to reach agreement
on local negotiated levels of
performance for the upcoming program
year; and
3) Used to establish adjusted levels of
performance at the end of a program
year based on actual conditions,
consistent with WIOA sec. 116( c)( 3).
b) Until all indicators for the core
program in a local area have at least 2
years of complete data, the comparison
of the actual results achieved to the
adjusted levels of performance for each
of the primary indicators only will be
applied where there are at least 2 years
of complete data for that program.
c) The Governor, Local Workforce
Development Board (WDB), and chief
elected official must reach agreement on
local negotiated levels of performance
based on a negotiations process before
the start of a program year with the use
of the objective statistical model
described in paragraph (a) of this
section. The negotiations will include a
discussion of circumstances not
accounted for in the model and will take
into account the extent to which the
levels promote continuous
improvement. The objective statistical
model will be applied at the end of the
program year based on actual economic
conditions and characteristics of the
participants served.
d) The negotiations process described
in paragraph (c) of this section must be
developed by the Governor and
disseminated to all Local WDBs and
chief elected officials.
e) The Local WDBs may apply
performance measures to service
providers that differ from the
performance indicators that apply to the
local area. These performance measures
must be established after considering:
1) The established local negotiated
levels;
2) The services provided by each
provider; and
3) The populations the service
providers are intended to serve.
Subpart D— Incentives and Sanctions
for Local Performance for Workforce
Innovation and Opportunity Act Title I
Programs
677.215 Under what circumstances are
local areas eligible for State Incentive
Grants?
a) The Governor is not required to
award local incentive funds, but is
authorized to provide incentive grants
to local areas for performance on the
primary indicators of performance
consistent with WIOA sec.
134( a)( 3)( A)(xi).
b) The Governor may use non -
Federal funds to create incentives for
the Local WDBs to implement pay -for -
performance contract strategies for the
delivery of training services described
in WIOA sec. 134( c)( 3) or activities
described in WIOA sec. 129( c)( 2) in the
local areas served by the Local WDBs.
Pay -for -performance contract strategies
must be implemented in accordance
with part 683, subpart E of this chapter
and § 677. 160.
677.220 Under what circumstances may
a corrective action or sanction be applied
to local areas for poor performance?
a) If a local area fails to meet the
adjusted levels of performance agreed to
under § 677. 210 for the primary
indicators of performance in the adult,
dislocated worker, and youth programs
authorized under WIOA title I in any
program year, technical assistance must
be provided by the Governor or, upon
the Governor' s request, by the Secretary
of Labor.
1) A State must establish the
threshold for failure to meet adjusted
levels of performance for a local area
before coming to agreement on the
negotiated levels of performance for the
local area.
i) A State must establish the adjusted
level of performance for a local area,
using the statistical adjustment model
described in § 677. 170( c).
ii) At least 2 years of complete data
on any indicator for any local core
program are required in order to
establish adjusted levels of performance
for a local area.
2) The technical assistance may
include:
i) Assistance in the development of a
performance improvement plan;
ii) The development of a modified
local or regional plan; or
iii) Other actions designed to assist
the local area in improving
performance.
b) If a local area fails to meet the
adjusted levels of performance agreed to
under § 677. 210 for the same primary
indicators of performance for the same
core program authorized under WIOA
title I for a third consecutive program
year, the Governor must take corrective
actions. The corrective actions must
include the development of a
reorganization plan under which the
Governor:
1) Requires the appointment and
certification of a new Local WDB,
consistent with the criteria established
under § 679. 350 of this chapter;
2) Prohibits the use of eligible
providers and one-stop partners that
have been identified as achieving poor
levels of performance; or
3) Takes such other significant
actions as the Governor determines are
appropriate.
677.225 Under what circumstances may
local areas appeal a reorganization plan?
a) The Local WDB and chief elected
official for a local area that is subject to
a reorganization plan under WIOA sec.
116( g)( 2)( A) may appeal to the Governor
to rescind or revise the reorganization
plan not later than 30 days after
receiving notice of the reorganization
plan. The Governor must make a final
decision within 30 days after receipt of
the appeal.
b) The Local WDB and chief elected
official may appeal the final decision of
the Governor to the Secretary of Labor
not later than 30 days after receiving the
decision from the Governor. Any appeal
of the Governor' s final decision must be:
1) Appealed jointly by the Local
WDB and chief elected official to the
Secretary of Labor under § 683. 650 of
this chapter; and
2) Must be submitted by certified
mail, return receipt requested, to the
Secretary of Labor, U. S. Department of
Labor, 200 Constitution Ave. NW.,
Washington, DC 20210, Attention:
ASET. A copy of the appeal must be
simultaneously provided to the
Governor.
c) Upon receipt of the joint appeal
from the Local WDB and chief elected
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official, the Secretary of Labor must
make a final decision within 30 days. In
making this determination the Secretary
of Labor may consider any comments
submitted by the Governor in response
to the appeals.
d) The decision by the Governor on
the appeal becomes effective at the time
it is issued and remains effective unless
the Secretary of Labor rescinds or
revises the reorganization plan under
WIOA sec. 116( g)( 2)( C).
Subpart E— Eligible Training Provider
Performance for Workforce Innovation
and Opportunity Act Title I Programs
677.230 What information is required for
the eligible training provider performance
reports?
a) States are required to make
available and publish annually using a
template the Departments of Labor and
Education will disseminate including
through electronic means, the ETP
performance reports for ETPs who
provide services under sec. 122 of
WIOA that are described in §§680.400
through 680. 530 of this chapter. These
reports at a minimum must include,
consistent with §677. 175 and with
respect to each program of study that is
eligible to receive funds under WIOA:
1) The total number of participants as
defined by § 677. 150( a) who received
training services under the adult and
dislocated worker programs authorized
under WIOA title I for the most recent
year and the 3 preceding program years,
including:
i) The number of participants under
the adult and dislocated worker
programs disaggregated by barriers to
employment;
ii) The number of participants under
the adult and dislocated worker
programs disaggregated by race,
ethnicity, sex, and age;
iii) The number of participants under
the adult and dislocated worker
programs disaggregated by the type of
training entity for the most recent
program year and the 3 preceding
program years;
2) The total number of participants
who exit a program of study or its
equivalent, including disaggregate
counts by the type of training entity
during the most recent program year
and the 3 preceding program years;
3) The average cost -per -participant
for participants who received training
services for the most recent program
year and the 3 preceding program years
disaggregated by type of training entity;
4) The total number of individuals
exiting from the program of study (or
the equivalent) with respect to all
individuals engaging in the program of
study (or the equivalent); and
5) The levels of performance
achieved for the primary indicators of
performance identified in
677. 155( a)( 1)( i) through (iv) with
respect to all individuals engaging in a
program of study (or the equivalent).
b) Apprenticeship programs
registered under the National
Apprenticeship Act are not required to
submit ETP performance information. If
a registered apprenticeship program
voluntarily submits performance
information to a State, the State must
include this information in the report.
c) The State must provide a
mechanism of electronic access to the
public ETP performance report in its
annual State performance report.
d) States must comply with any
requirements from sec. 116( d)( 4) of
WIOA as explained in guidance issued
by DOL.
e) The Governor may designate one
or more State agencies such as a State
Education Agency or other State
Educational Authority to assist in
overseeing ETP performance and
facilitating the production and
dissemination of ETP performance
reports. These agencies may be the same
agencies that are designated as
responsible for administering the ETP
list as provided under § 680. 500 of this
chapter. The Governor or such agencies,
or authorities, is responsible for:
1) Facilitating data matches between
ETP records and unemployment
insurance (UI) wage data in order to
produce the report;
2) The creation and dissemination of
the reports as described in paragraphs
a) through (d) of this section;
3) Coordinating the dissemination of
the performance reports with the ETP
list and the information required to
accompany the list, as provided in
680. 500 of this chapter.
Subpart F— Performance Reporting
Administrative Requirements
677.235 What are the reporting
requirements for individual records for core
Workforce Innovation and Opportunity Act
WIOA) title I programs; the Wagner-Peyser
Act Employment Service program, as
amended by WIOA title III; and the
Vocational Rehabilitation program
authorized under title I of the Rehabilitation
Act of 1973, as amended by WIOA title IV?
a) On a quarterly basis, each State
must submit to the Secretary of Labor or
the Secretary of Education, as
appropriate, individual records that
include demographic information,
information on services received, and
information on resulting outcomes, as
appropriate, for each reportable
individual in either of the following
programs administered by the Secretary
of Labor or Secretary of Education: A
WIOA title I core program; the
Employment Service program
authorized under the Wagner-Peyser
Act, as amended by WIOA title III; or
the VR program authorized under title I
of the Rehabilitation Act of 1973, as
amended by WIOA title IV.
b) For individual records submitted
to the Secretary of Labor, those records
may be required to be integrated across
all programs administered by the
Secretary of Labor in one single file.
c) States must comply with the
requirements of sec. 116(d)( 2) of WIOA
as explained in guidance issued by the
Departments of Labor and Education.
677.240 What are the requirements for
data validation of State annual performance
reports?
a) States must establish procedures,
consistent with guidelines issued by the
Secretary of Labor or the Secretary of
Education, to ensure that they submit
complete annual performance reports
that contain information that is valid
and reliable, as required by WIOA sec.
116( d)( 5).
b) If a State fails to meet standards in
paragraph (a) of this section as
determined by the Secretary of Labor or
the Secretary of Education, the
appropriate Secretary will provide
technical assistance and may require the
State to develop and implement
corrective actions, which may require
the State to provide training for its
subrecipients.
c) The Secretaries of Labor and
Education will provide training and
technical assistance to States in order to
implement this section. States must
comply with the requirements of sec.
116( d)( 5) of WIOA as explained in
guidance.
3. Add part 678 to read as follows:
PART 678— DESCRIPTION OF THE
ONE-STOP DELIVERY SYSTEM
UNDER TITLE I OF THE WORKFORCE
INNOVATION AND OPPORTUNITY ACT
Subpart A—General Description of the One -
Stop Delivery System
Sec.
678. 300 What is the one-stop delivery
system?
678. 305 What is a comprehensive one-stop
center and what must be provided there?
678. 310 What is an affiliated site and what
must be provided there?
678.315 Can a stand-alone Wagner-Peyser
Act Employment Service office be
designated as an affiliated one-stop site?
678. 320 Are there any requirements for
networks of eligible one-stop partners or
specialized centers?
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Subpart B -One -Stop Partners and the
Responsibilities of Partners
678.400 Who are the required one-stop
partners?
678.405 Is Temporary Assistance for Needy
Families a required one-stop partner?
678.410 What other entities may serve as
one-stop partners?
678.415 What entity serves as the one-stop
partner for a particular program in the
local area?
678.420 What are the roles and
responsibilities of the required one-stop
partners?
678.425 What are the applicable career
services that must be provided through
the one-stop delivery system by required
one-stop partners?
678.430 What are career services?
678.435 What are the business services
provided through the one-stop delivery
system, and how are they provided?
678.440 When may a fee be charged for the
business services in this subpart?
Subpart C -Memorandum of Understanding
for the One -Stop Delivery System
678. 500 What is the Memorandum of
Understanding for the one-stop delivery
system and what must be included in the
Memorandum of Understanding?
678. 505 Is there a single Memorandum of
Understanding for the local area, or must
there be different Memoranda of
Understanding between the Local
Workforce Development Board and each
partner?
678. 510 How must the Memorandum of
Understanding be negotiated?
Subpart D -One -Stop Operators
678. 600 Who may operate one-stop centers?
678. 605 How is the one-stop operator
selected?
678. 610 When is the sole -source selection
of one-stop operators appropriate, and
how is it conducted?
678. 615 May an entity currently serving as
one-stop operator compete to be a one-
stop operator under the procurement
requirements of this subpart?
678. 620 What is the one-stop operator' s
role?
678. 625 Can a one-stop operator also be a
service provider?
678. 630 Can State merit staff still work in
a one-stop center where the operator is
not a governmental entity?
678. 635 What is the compliance date of the
provisions of this subpart?
Subpart E -One -Stop Operating Costs
678.700 What are the one-stop
infrastructure costs?
678. 705 What guidance must the Governor
issue regarding one-stop infrastructure
funding?
678. 710 How are infrastructure costs
funded?
678. 715 How are one-stop infrastructure
costs funded in the local funding
mechanism?
678. 720 What funds are used to pay for
infrastructure costs in the local one-stop
infrastructure funding mechanism?
678. 725 What happens if consensus on
infrastructure funding is not reached at
the local level between the Local
Workforce Development Board, chief
elected officials, and one-stop partners?
678. 730 What is the State one-stop
infrastructure funding mechanism?
678. 731 What are the steps to determine the
amount to be paid under the State one-
stop infrastructure funding mechanism?
678. 735 How are infrastructure cost budgets
for the one-stop centers in a local area
determined in the State one-stop
infrastructure funding mechanism?
678. 736 How does the Governor establish a
cost allocation methodology used to
determine the one-stop partner
programs' proportionate shares of
infrastructure costs under the State one-
stop infrastructure funding mechanism?
678. 737 How are one-stop partner
programs' proportionate shares of
infrastructure costs determined under
the State one-stop infrastructure funding
mechanism?
678. 738 How are statewide caps on the
contributions for one-stop infrastructure
funding determined in the State one-stop
infrastructure funding mechanism?
678. 740 What funds are used to pay for
infrastructure costs in the State one-stop
infrastructure funding mechanism?
678. 745 What factors does the State
Workforce Development Board use to
develop the formula described in
Workforce Innovation and Opportunity
Act, which is used by the Governor to
determine the appropriate one-stop
infrastructure budget for each local area
operating under the State infrastructure
funding mechanism, if no reasonably
implementable locally negotiated budget
exists?
678. 750 When and how can a one-stop
partner appeal a one-stop infrastructure
amount designated by the State under
the State infrastructure funding
mechanism?
678. 755 What are the required elements
regarding infrastructure funding that
must be included in the one-stop
Memorandum of Understanding?
678. 760 How do one-stop partners jointly
fund other shared costs under the
Memorandum of Understanding?
Subpart F -One -Stop Certification
678. 800 How are one-stop centers and one-
stop delivery systems certified for
effectiveness, physical and programmatic
accessibility, and continuous
improvement?
Subpart G -Common Identifier
678. 900 What is the common identifier to
be used by each one-stop delivery
system?
Authority: Secs. 503, 107, 121, 134, 189,
Pub. L. 113- 128, 128 Stat. 1425 ( Jul. 22,
2014).
Subpart A -General Description of the
One -Stop Delivery System
678.300 What is the one-stop delivery
system?
a) The one-stop delivery system
brings together workforce development,
educational, and other human resource
services in a seamless customer -focused
service delivery network that enhances
access to the programs' services and
improves long-term employment
outcomes for individuals receiving
assistance. One-stop partners administer
separately funded programs as a set of
integrated streamlined services to
customers.
b) Title I of the Workforce Innovation
and Opportunity Act (WIOA) assigns
responsibilities at the local, State, and
Federal level to ensure the creation and
maintenance of a one-stop delivery
system that enhances the range and
quality of education and workforce
development services that employers
and individual customers can access.
c) The system must include at least
one comprehensive physical center in
each local area as described in
678. 305.
d) The system may also have
additional arrangements to supplement
the comprehensive center. These
arrangements include:
1) An affiliated site or a network of
affiliated sites, where one or more
partners make programs, services, and
activities available, as described in
678. 310;
2) A network of eligible one-stop
partners, as described in §§678.400
through 678. 410, through which each
partner provides one or more of the
programs, services, and activities that
are linked, physically or
technologically, to an affiliated site or
access point that assures customers are
provided information on the availability
of career services, as well as other
program services and activities,
regardless of where they initially enter
the public workforce system in the local
area; and
3) Specialized centers that address
specific needs, including those of
dislocated workers, youth, or key
industry sectors, or clusters.
e) Required one-stop partner
programs must provide access to
programs, services, and activities
through electronic means if applicable
and practicable. This is in addition to
providing access to services through the
mandatory comprehensive physical one-
stop center and any affiliated sites or
specialized centers. The provision of
programs and services by electronic
methods such as Web sites, telephones,
or other means must improve the
efficiency, coordination, and quality of
one-stop partner services. Electronic
delivery must not replace access to such
services at a comprehensive one-stop
center or be a substitute to making
services available at an affiliated site if
the partner is participating in an
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affiliated site. Electronic delivery
systems must be in compliance with the
nondiscrimination and equal
opportunity provisions of WIOA sec.
188 and its implementing regulations at
29 CFR part 38.
f) The design of the local area' s one-
stop delivery system must be described
in the Memorandum of Understanding
MOU) executed with the one-stop
partners, described in § 678. 500.
678.305 What is a comprehensive one-
stop center and what must be provided
there?
a) A comprehensive one-stop center
is a physical location where job seeker
and employer customers can access the
programs, services, and activities of all
required one-stop partners. A
comprehensive one-stop center must
have at least one title I staff person
physically present.
b) The comprehensive one-stop
center must provide:
1) Career services, described in
678.430;
2) Access to training services
described in § 680. 200 of this chapter;
3) Access to any employment and
training activities carried out under sec.
134(d) of WIOA;
4) Access to programs and activities
carried out by one-stop partners listed
in §§678.400 through 678.410,
including the Employment Service
program authorized under the Wagner-
Peyser Act, as amended by WIOA title
III (Wagner-Peyser Act Employment
Service program); and
5) Workforce and labor market
information.
c) Customers must have access to
these programs, services, and activities
during regular business days at a
comprehensive one-stop center. The
Local Workforce Development Board
WDB) may establish other service hours
at other times to accommodate the
schedules of individuals who work on
regular business days. The State WDB
will evaluate the hours of access to
service as part of the evaluation of
effectiveness in the one-stop
certification process described in
678. 800(b).
d) " Access" to each partner program
and its services means:
1) Having a program staff member
physically present at the one-stop
center;
2) Having a staff member from a
different partner program physically
present at the one-stop center
appropriately trained to provide
information to customers about the
programs, services, and activities
available through partner programs; or
3) Making available a direct linkage
through technology to program staff
who can provide meaningful
information or services.
i) A " direct linkage" means
providing direct connection at the one-
stop center, within a reasonable time, by
phone or through a real-time Web -based
communication to a program staff
member who can provide program
information or services to the customer.
ii) A " direct linkage" cannot
exclusively be providing a phone
number or computer Web site or
providing information, pamphlets, or
materials.
e) All comprehensive one-stop
centers must be physically and
programmatically accessible to
individuals with disabilities, as
described in 29 CFR part 38, the
implementing regulations of WIOA sec.
188.
678.310 What is an affiliated site and
what must be provided there?
a) An affiliated site, or affiliate one-
stop center, is a site that makes available
to job seeker and employer customers
one or more of the one-stop partners'
programs, services, and activities. An
affiliated site does not need to provide
access to every required one-stop
partner program. The frequency of
program staff's physical presence in the
affiliated site will be determined at the
local level. Affiliated sites are access
points in addition to the comprehensive
one-stop center(s) in each local area. If
used by local areas as a part of the
service delivery strategy, affiliate sites
must be implemented in a manner that
supplements and enhances customer
access to services.
b) As described in § 678. 315, Wagner-
Peyser Act employment services cannot
be a stand-alone affiliated site.
c) States, in conjunction with the
Local WDBs, must examine lease
agreements and property holdings
throughout the one-stop delivery system
in order to use property in an efficient
and effective way. Where necessary and
appropriate, States and Local WDBs
must take expeditious steps to align
lease expiration dates with efforts to
consolidate one-stop operations into
service points where Wagner-Peyser Act
employment services are colocated as
soon as reasonably possible. These steps
must be included in the State Plan.
d) All affiliated sites must be
physically and programmatically
accessible to individuals with
disabilities, as described in 29 CFR part
38, the implementing regulations of
WIOA sec. 188.
678.315 Can a stand-alone Wagner-
Peyser Act Employment Service office be
designated as an affiliated one-stop site?
a) Separate stand-alone Wagner-
Peyser Act Employment Service offices
are not permitted under WIOA, as also
described in § 652. 202 of this chapter.
b) If Wagner-Peyser Act employment
services are provided at an affiliated
site, there must be at least one or more
other partners in the affiliated site with
a physical presence of combined staff
more than 50 percent of the time the
center is open. Additionally, the other
partner must not be the partner
administering local veterans'
employment representatives, disabled
veterans' outreach program specialists,
or unemployment compensation
programs. If Wagner-Peyser Act
employment services and any of these 3
programs are provided at an affiliated
site, an additional partner or partners
must have a presence of combined staff
in the center more than 50 percent of
the time the center is open.
678.320 Are there any requirements for
networks of eligible one-stop partners or
specialized centers?
Any network of one-stop partners or
specialized centers, as described in
678. 300( d)( 3), must be connected to
the comprehensive one-stop center and
any appropriate affiliate one-stop
centers, for example, by having
processes in place to make referrals to
these centers and the partner programs
located in them. Wagner-Peyser Act
employment services cannot stand alone
in a specialized center. Just as described
in § 678. 315 for an affiliated site, a
specialized center must include other
programs besides Wagner-Peyser Act
employment services, local veterans'
employment representatives, disabled
veterans' outreach program specialists,
and unemployment compensation.
Subpart B— One-Stop Partners and the
Responsibilities of Partners
678.400 Who are the required one-stop
partners?
a) Section 121(b)( 1)( B) of WIOA
identifies the entities that are required
partners in the local one-stop delivery
systems.
b) The required partners are the
entities responsible for administering
the following programs and activities in
the local area:
1) Programs authorized under title I
of WIOA, including:
i) Adults;
ii) Dislocated workers;
iii) Youth;
iv) Job Corps;
v) YouthBuild;
vi) Native American programs; and
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vii) Migrant and seasonal farmworker
programs;
2) The Wagner-Peyser Act
Employment Service program
authorized under the Wagner-Peyser Act
29 U.S. C. 49 et seq.), as amended by
WIOA title III;
3) The Adult Education and Family
Literacy Act (AEFLA) program
authorized under title II of WIOA;
4) The Vocational Rehabilitation (VR)
program authorized under title I of the
Rehabilitation Act of 1973 ( 29 U.S. C.
720 et seq.), as amended by WIOA title
IV;
5) The Senior Community Service
Employment Program authorized under
title V of the Older Americans Act of
1965 ( 42 U. S. C. 3056 et seq.);
6) Career and technical education
programs at the postsecondary level
authorized under the Carl D. Perkins
Career and Technical Education Act of
2006 ( 20 U.S. C. 2301 et seq.);
7) Trade Adjustment Assistance
activities authorized under chapter 2 of
title II of the Trade Act of 1974 ( 19
U.S. C. 2271 et seq.);
8) Jobs for Veterans State Grants
programs authorized under chapter 41
of title 38, U.S. C.;
9) Employment and training
activities carried out under the
Community Services Block Grant (42
U.S. C. 9901 et seq.);
10) Employment and training
activities carried out by the Department
of Housing and Urban Development;
11) Programs authorized under State
unemployment compensation laws (in
accordance with applicable Federal
law);
12) Programs authorized under sec.
212 of the Second Chance Act of 2007
42 U.S. C. 17532); and
13) Temporary Assistance for Needy
Families (TANF) authorized under part
A of title IV of the Social Security Act
42 U.S. C. 601 et seq.), unless exempted
by the Governor under § 678.405(b).
678.405 Is Temporary Assistance for
Needy Families a required one-stop
partner?
a) Yes, TANF, authorized under part
A of title IV of the Social Security Act
42 U.S. C. 601 et seq.), is a required
partner.
b) The Governor may determine that
TANF will not be a required partner in
the State, or within some specific local
areas in the State. In this instance, the
Governor must notify the Secretaries of
the U.S. Departments of Labor and
Health and Human Services in writing
of this determination.
c) In States, or local areas within a
State, where the Governor has
determined that TANF is not required to
be a partner, local TANF programs may
still work in collaboration or
partnership with the local one-stop
centers to deliver employment and
training services to the TANF
population unless inconsistent with the
Governor' s direction.
678.410 What other entities may serve as
one-stop partners?
a) Other entities that carry out a
workforce development program,
including Federal, State, or local
programs and programs in the private
sector, may serve as additional partners
in the one-stop delivery system if the
Local WDB and chief elected official(s)
approve the entity' s participation.
b) Additional partners may include,
but are not limited to:
1) Employment and training
programs administered by the Social
Security Administration, including the
Ticket to Work and Self -Sufficiency
Program established under sec. 1148 of
the Social Security Act (42 U. S. C.
1320b-19);
2) Employment and training
programs carried out by the Small
Business Administration;
3) Supplemental Nutrition Assistance
Program (SNAP) employment and
training programs, authorized under
secs. 6( d)( 4) and 6( o) of the Food and
Nutrition Act of 2008 ( 7 U.S. C.
2015( d)(4));
4) Client Assistance Program
authorized under sec. 112 of the
Rehabilitation Act of 1973 ( 29 U.S. C.
732);
5) Programs authorized under the
National and Community Service Act of
1990 ( 42 U. S. C. 12501 et seq.); and
6) Other appropriate Federal, State or
local programs, including, but not
limited to, employment, education, and
training programs provided by public
libraries or in the private sector.
678.415 What entity serves as the one-
stop partner for a particular program in the
local area?
a) The entity that carries out the
program and activities listed in
678.400 or § 678.410, and therefore
serves as the one-stop partner, is the
grant recipient, administrative entity, or
organization responsible for
administering the funds of the specified
program in the local area. The term
entity" does not include the service
providers that contract with, or are
subrecipients of, the local
administrative entity. For programs that
do not include local administrative
entities, the responsible State agency
must be the partner. Specific entities for
particular programs are identified in
paragraphs (b) through (e) of this
section. If a program or activity listed in
678. 400 is not carried out in a local
area, the requirements relating to a
required one-stop partner are not
applicable to such program or activity in
that local one-stop delivery system.
b) For title II of WIOA, the entity or
agency that carries out the program for
the purposes of paragraph (a) of this
section is the sole entity or agency in
the State or outlying area responsible for
administering or supervising policy for
adult education and literacy activities in
the State or outlying area. The State
eligible entity or agency may delegate its
responsibilities under paragraph (a) of
this section to one or more eligible
providers or consortium of eligible
providers.
c) For the VR program, authorized
under title I of the Rehabilitation Act of
1973, as amended by WIOA title IV, the
entity that carries out the program for
the purposes of paragraph (a) of this
section is the designated State agencies
or designated State units specified
under sec. 101( a)( 2) of the
Rehabilitation Act that is primarily
concerned with vocational
rehabilitation, or vocational and other
rehabilitation, of individuals with
disabilities.
d) Under WIOA title I, the national
programs, including Job Corps, the
Native American program, YouthBuild,
and Migrant and Seasonal Farmworker
programs are required one-stop partners.
The entity for the Native American
program, YouthBuild, and Migrant and
Seasonal Farmworker programs is the
grantee of those respective programs.
The entity for Job Corps is the Job Corps
center.
e) For the Carl D. Perkins Career and
Technical Education Act of 2006, the
entity that carries out the program for
the purposes of paragraph (a) of this
section is the eligible recipient or
recipients at the postsecondary level, or
a consortium of eligible recipients at the
postsecondary level in the local area.
The eligible recipient at the
postsecondary level may also request
assistance from the State eligible agency
in completing its responsibilities under
paragraph (a) of this section.
678.420 What are the roles and
responsibilities of the required one-stop
partners?
Each required partner must:
a) Provide access to its programs or
activities through the one-stop delivery
system, in addition to any other
appropriate locations;
b) Use a portion of funds made
available to the partner' s program, to the
extent consistent with the Federal law
authorizing the partner' s program and
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with Federal cost principles in 2 CFR
parts 200 and 2900 (requiring, among
other things, that costs are allowable,
reasonable, necessary, and allocable), to:
1) Provide applicable career services;
and
2) Work collaboratively with the
State and Local WDBs to establish and
maintain the one-stop delivery system.
This includes jointly funding the one-
stop infrastructure through partner
contributions that are based upon:
i) A reasonable cost allocation
methodology by which infrastructure
costs are charged to each partner based
on proportionate use and relative
benefit received;
ii) Federal cost principles; and
iii) Any local administrative cost
requirements in the Federal law
authorizing the partner' s program. (This
is further described in § 678. 700.)
c) Enter into an MOU with the Local
WDB relating to the operation of the
one-stop delivery system that meets the
requirements of §678.500(b);
d) Participate in the operation of the
one-stop delivery system consistent
with the terms of the MOU,
requirements of authorizing laws, the
Federal cost principles, and all other
applicable legal requirements; and
e) Provide representation on the State
and Local WDBs as required and
participate in Board committees as
needed.
678.425 What are the applicable career
services that must be provided through the
one-stop delivery system by required one-
stop partners?
a) The applicable career services to
be delivered by required one-stop
partners are those services listed in
678.430 that are authorized to be
provided under each partner' s program.
b) One-stop centers provide services
to individual customers based on
individual needs, including the
seamless delivery of multiple services to
individual customers. There is no
required sequence of services.
678.430 What are career services?
Career services, as identified in sec.
134( c)( 2) of WIOA, consist of three
types:
a) Basic career services must be made
available and, at a minimum, must
include the following services, as
consistent with allowable program
activities and Federal cost principles:
1) Determinations of whether the
individual is eligible to receive
assistance from the adult, dislocated
worker, or youth programs;
2) Outreach, intake (including worker
profiling), and orientation to
information and other services available
through the one-stop delivery system.
For the TANF program, States must
provide individuals with the
opportunity to initiate an application for
TANF assistance and non -assistance
benefits and services, which could be
implemented through the provision of
paper application forms or links to the
application Web site;
3) Initial assessment of skill levels
including literacy, numeracy, and
English language proficiency, as well as
aptitudes, abilities (including skills
gaps), and supportive services needs;
4) Labor exchange services,
including—
i) Job search and placement
assistance, and, when needed by an
individual, career counseling,
including—
A) Provision of information on in -
demand industry sectors and
occupations (as defined in sec. 3( 23) of
WIOA); and
B) Provision of information on
nontraditional employment; and
ii) Appropriate recruitment and other
business services on behalf of
employers, including information and
referrals to specialized business services
other than those traditionally offered
through the one-stop delivery system;
5) Provision of referrals to and
coordination of activities with other
programs and services, including
programs and services within the one-
stop delivery system and, when
appropriate, other workforce
development programs;
6) Provision of workforce and labor
market employment statistics
information, including the provision of
accurate information relating to local,
regional, and national labor market
areas, including—
i) Job vacancy listings in labor market
areas;
ii) Information on job skills necessary
to obtain the vacant jobs listed; and
iii) Information relating to local
occupations in demand and the
earnings, skill requirements, and
opportunities for advancement for those
jobs;
7) Provision of performance
information and program cost
information on eligible providers of
education, training, and workforce
services by program and type of
providers;
8) Provision of information, in usable
and understandable formats and
languages, about how the local area is
performing on local performance
accountability measures, as well as any
additional performance information
relating to the area' s one-stop delivery
system;
9) Provision of information, in usable
and understandable formats and
languages, relating to the availability of
supportive services or assistance, and
appropriate referrals to those services
and assistance, including: Child care;
child support; medical or child health
assistance available through the State' s
Medicaid program and Children' s
Health Insurance Program; benefits
under SNAP; assistance through the
earned income tax credit; and assistance
under a State program for TANF, and
other supportive services and
transportation provided through that
program;
10) Provision of information and
meaningful assistance to individuals
seeking assistance in filing a claim for
unemployment compensation.
i) "Meaningful assistance" means:
A) Providing assistance on-site using
staff who are well-trained in
unemployment compensation claims
filing and the rights and responsibilities
of claimants; or
B) Providing assistance by phone or
via other technology, as long as the
assistance is provided by trained and
available staff and within a reasonable
time.
ii) The costs associated in providing
this assistance may be paid for by the
State' s unemployment insurance
program, or the WIOA adult or
dislocated worker programs, or some
combination thereof.
11) Assistance in establishing
eligibility for programs of financial aid
assistance for training and education
programs not provided under WIOA.
b) Individualized career services
must be made available if determined to
be appropriate in order for an individual
to obtain or retain employment. These
services include the following services,
as consistent with program
requirements and Federal cost
principles:
1) Comprehensive and specialized
assessments of the skill levels and
service needs of adults and dislocated
workers, which may include—
i) Diagnostic testing and use of other
assessment tools; and
ii) In-depth interviewing and
evaluation to identify employment
barriers and appropriate employment
goals;
2) Development of an individual
employment plan, to identify the
employment goals, appropriate
achievement objectives, and appropriate
combination of services for the
participant to achieve his or her
employment goals, including the list of,
and information about, the eligible
training providers (as described in
680. 180 of this chapter);
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3) Group counseling;
4) Individual counseling;
5) Career planning;
6) Short-term pre -vocational services
including development of learning
skills, communication skills,
interviewing skills, punctuality,
personal maintenance skills, and
professional conduct services to prepare
individuals for unsubsidized
employment or training;
7) Internships and work experiences
that are linked to careers ( as described
in § 680. 170 of this chapter);
8) Workforce preparation activities;
9) Financial literacy services as
described in sec. 129(b)( 2)( D) of WIOA
and § 681. 500 of this chapter;
10) Out -of -area job search assistance
and relocation assistance; and
11) English language acquisition and
integrated education and training
programs.
c) Follow-up services must be
provided, as appropriate, including:
Counseling regarding the workplace, for
participants in adult or dislocated
worker workforce investment activities
who are placed in unsubsidized
employment, for up to 12 months after
the first day of employment.
d) In addition to the requirements in
paragraph (a)( 2) of this section, TANF
agencies must identify employment
services and related support being
provided by the TANF program (within
the local area) that qualify as career
services and ensure access to them via
the local one-stop delivery system.
678.435 What are the business services
provided through the one-stop delivery
system, and how are they provided?
a) Certain career services must be
made available to local employers,
specifically labor exchange activities
and labor market information described
in § 678.430(a)(4)(ii) and (a)(6). Local
areas must establish and develop
relationships and networks with large
and small employers and their
intermediaries. Local areas also must
develop, convene, or implement
industry or sector partnerships.
b) Customized business services may
be provided to employers, employer
associations, or other such
organizations. These services are
tailored for specific employers and may
include:
1) Customized screening and referral
of qualified participants in training
services to employers;
2) Customized services to employers,
employer associations, or other such
organizations, on employment-related
issues;
3) Customized recruitment events
and related services for employers
including targeted job fairs;
4) Human resource consultation
services, including but not limited to
assistance with:
i) Writing/ reviewing job descriptions
and employee handbooks;
ii) Developing performance
evaluation and personnel policies;
iii) Creating orientation sessions for
new workers;
iv) Honing job interview techniques
for efficiency and compliance;
v) Analyzing employee turnover;
vi) Creating job accommodations and
using assistive technologies; or
vii) Explaining labor and
employment laws to help employers
comply with discrimination, wage/ hour,
and safety/ health regulations;
5) Customized labor market
information for specific employers,
sectors, industries or clusters; and
6) Other similar customized services.
c) Local areas may also provide other
business services and strategies that
meet the workforce investment needs of
area employers, in accordance with
partner programs' statutory
requirements and consistent with
Federal cost principles. These business
services may be provided through
effective business intermediaries
working in conjunction with the Local
WDB, or through the use of economic
development, philanthropic, and other
public and private resources in a
manner determined appropriate by the
Local WDB and in cooperation with the
State. Allowable activities, consistent
with each partner' s authorized
activities, include, but are not limited
to:
1) Developing and implementing
industry sector strategies ( including
strategies involving industry
partnerships, regional skills alliances,
industry skill panels, and sectoral skills
partnerships);
2) Customized assistance or referral
for assistance in the development of a
registered apprenticeship program;
3) Developing and delivering
innovative workforce investment
services and strategies for area
employers, which may include career
pathways, skills upgrading, skill
standard development and certification
for recognized postsecondary credential
or other employer use, and other
effective initiatives for meeting the
workforce investment needs of area
employers and workers;
4) Assistance to area employers in
managing reductions in force in
coordination with rapid response
activities and with strategies for the
aversion of layoffs, which may include
strategies such as early identification of
firms at risk of layoffs, use of feasibility
studies to assess the needs of and
options for at -risk firms, and the
delivery of employment and training
activities to address risk factors;
5) The marketing of business services
to appropriate area employers,
including small and mid-sized
employers; and
6) Assisting employers with
accessing local, State, and Federal tax
credits.
d) All business services and
strategies must be reflected in the local
plan, described in § 679.560(b)( 3) of this
chapter.
678.440 When may a fee be charged for
the business services in this subpart?
a) There is no requirement that a fee-
for-service be charged to employers.
b) No fee may be charged for services
provided in § 678. 435( a).
c) A fee may be charged for services
provided under § 678.435( b) and (c).
Services provided under § 678. 435( c)
may be provided through effective
business intermediaries working in
conjunction with the Local WDB and
may also be provided on a fee-for-
service basis or through the leveraging
of economic development,
philanthropic, and other public and
private resources in a manner
determined appropriate by the Local
WDB. The Local WDB may examine the
services provided compared with the
assets and resources available within
the local one-stop delivery system and
through its partners to determine an
appropriate cost structure for services, if
any.
d) Any fees earned are recognized as
program income and must be expended
by the partner in accordance with the
partner program' s authorizing statute,
implementing regulations, and Federal
cost principles identified in Uniform
Guidance.
Subpart C— Memorandum of
Understanding for the One -Stop
Delivery System
678.500 What is the Memorandum of
Understanding for the one-stop delivery
system and what must be included in the
Memorandum of Understanding?
a) The MOU is the product of local
discussion and negotiation, and is an
agreement developed and executed
between the Local WDB and the one-
stop partners, with the agreement of the
chief elected official and the one-stop
partners, relating to the operation of the
one-stop delivery system in the local
area. Two or more local areas in a region
may develop a single joint MOU, if they
are in a region that has submitted a
regional plan under sec. 106 of WIOA.
b) The MOU must include:
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1) A description of services to be
provided through the one-stop delivery
system, including the manner in which
the services will be coordinated and
delivered through the system;
2) Agreement on funding the costs of
the services and the operating costs of
the system, including:
i) Funding of infrastructure costs of
one-stop centers in accordance with
678. 700 through 678. 755; and
ii) Funding of the shared services and
operating costs of the one-stop delivery
system described in § 678. 760;
3) Methods for referring individuals
between the one-stop operators and
partners for appropriate services and
activities;
4) Methods to ensure that the needs
of workers, youth, and individuals with
barriers to employment, including
individuals with disabilities, are
addressed in providing access to
services, including access to technology
and materials that are available through
the one-stop delivery system;
5) The duration of the MOU and
procedures for amending it; and
6) Assurances that each MOU will be
reviewed, and if substantial changes
have occurred, renewed, not less than
once every 3 -year period to ensure
appropriate funding and delivery of
services.
c) The MOU may contain any other
provisions agreed to by the parties that
are consistent with WIOA title I, the
authorizing statutes and regulations of
one-stop partner programs, and the
WIOA regulations.
d) When fully executed, the MOU
must contain the signatures of the Local
WDB, one-stop partners, the chief
elected official(s), and the time period
in which the agreement is effective. The
MOU must be updated not less than
every 3 years to reflect any changes in
the signatory official of the Board, one-
stop partners, and chief elected officials,
or one-stop infrastructure funding.
e) If a one-stop partner appeal to the
State regarding infrastructure costs,
using the process described in
678. 750, results in a change to the one-
stop partner' s infrastructure cost
contributions, the MOU must be
updated to reflect the final one-stop
partner infrastructure cost
contributions.
678.505 Is there a single Memorandum of
Understanding for the local area, or must
there be different Memoranda of
Understanding between the Local
Workforce Development Board and each
partner?
a) A single " umbrella" MOU may be
developed that addresses the issues
relating to the local one-stop delivery
system for the Local WDB, chief elected
official and all partners. Alternatively,
the Local WDB ( with agreement of chief
elected official) may enter into separate
agreements between each partner or
groups of partners.
b) Under either approach, the
requirements described in § 678. 500
apply. Since funds are generally
appropriated annually, the Local WDB
may negotiate financial agreements with
each partner annually to update funding
of services and operating costs of the
system under the MOU.
678.510 How must the Memorandum of
Understanding be negotiated?
a) WIOA emphasizes full and
effective partnerships between Local
WDBs, chief elected officials, and one-
stop partners. Local WDBs and partners
must enter into good -faith negotiations.
Local WDBs, chief elected officials, and
one-stop partners may also request
assistance from a State agency
responsible for administering the
partner program, the Governor, State
WDB, or other appropriate parties on
other aspects of the MOU.
b) Local WDBs and one-stop partners
must establish, in the MOU, how they
will fund the infrastructure costs and
other shared costs of the one-stop
centers. If agreement regarding
infrastructure costs is not reached when
other sections of the MOU are ready, an
interim infrastructure funding
agreement may be included instead, as
described in § 678. 715( c). Once
agreement on infrastructure funding is
reached, the Local WDB and one-stop
partners must amend the MOU to
include the infrastructure funding of the
one-stop centers. Infrastructure funding
is described in detail in subpart E of this
part.
c) The Local WDB must report to the
State WDB, Governor, and relevant State
agency when MOU negotiations with
one-stop partners have reached an
impasse.
1) The Local WDB and partners must
document the negotiations and efforts
that have taken place in the MOU. The
State WDB, one-stop partner programs,
and the Governor may consult with the
appropriate Federal agencies to address
impasse situations related to issues
other than infrastructure funding after
attempting to address the impasse.
Impasses related to infrastructure cost
funding must be resolved using the
State infrastructure cost funding
mechanism described in § 678. 730.
2) The Local WDB must report failure
to execute an MOU with a required
partner to the Governor, State WDB, and
the State agency responsible for
administering the partner' s program.
Additionally, if the State cannot assist
the Local WDB in resolving the impasse,
the Governor or the State WDB must
report the failure to the Secretary of
Labor and to the head of any other
Federal agency with responsibility for
oversight of a partner' s program.
Subpart D— One-Stop Operators
678.600 Who may operate one-stop
centers?
a) One-stop operators may be a single
entity (public, private, or nonprofit) or
a consortium of entities. If the
consortium of entities is one of one-stop
partners, it must include a minimum of
three of the one-stop partners described
in § 678.400.
b) The one-stop operator may operate
one or more one-stop centers. There
may be more than one one-stop operator
in a local area.
c) The types of entities that may be
a one-stop operator include:
1) An institution of higher education;
2) An Employment Service State
agency established under the Wagner-
Peyser Act;
3) A community-based organization,
nonprofit organization, or workforce
intermediary;
4) A private for-profit entity;
5) A government agency;
6) A Local WDB, with the approval
of the chief elected official and the
Governor; or
7) Another interested organization or
entity, which is capable of carrying out
the duties of the one-stop operator.
Examples may include a local chamber
of commerce or other business
organization, or a labor organization.
d) Elementary schools and secondary
schools are not eligible as one-stop
operators, except that a nontraditional
public secondary school such as a night
school, adult school, or an area career
and technical education school may be
selected.
e) The State and Local WDBs must
ensure that, in carrying out WIOA
programs and activities, one-stop
operators:
1) Disclose any potential conflicts of
interest arising from the relationships of
the operators with particular training
service providers or other service
providers (further discussed in
679.430 of this chapter);
2) Do not establish practices that
create disincentives to providing
services to individuals with barriers to
employment who may require longer-
term career and training services; and
3) Comply with Federal regulations
and procurement policies relating to the
calculation and use of profits, including
those at § 683. 295 of this chapter, the
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Uniform Guidance at 2 CFR part 200,
and other applicable regulations and
policies.
678.605 How is the one-stop operator
selected?
a) Consistent with paragraphs (b) and
c) of this section, the Local WDB must
select the one-stop operator through a
competitive process, as required by sec.
121( d)(2)( A) of WIOA, at least once
every 4 years. A State may require, or
a Local WDB may choose to implement,
a competitive selection process more
than once every 4 years.
b) In instances in which a State is
conducting the competitive process
described in paragraph (a) of this
section, the State must follow the same
policies and procedures it uses for
procurement with non -Federal funds.
c) All other non -Federal entities,
including subrecipients of a State ( such
as local areas), must use a competitive
process based on local procurement
policies and procedures and the
principles of competitive procurement
in the Uniform Guidance set out at 2
CFR 200. 318 through 200. 326. All
references to " noncompetitive
proposals" in the Uniform Guidance at
2 CFR 200. 320( f) will be read as " sole
source procurement" for the purposes of
implementing this section.
d) Entities must prepare written
documentation explaining the
determination concerning the nature of
the competitive process to be followed
in selecting a one-stop operator.
678.610 When is the sole -source
selection of one-stop operators appropriate,
and how is it conducted?
a) States may select a one-stop
operator through sole source selection
when allowed under the same policies
and procedures used for competitive
procurement with non -Federal funds,
while other non -Federal entities
including subrecipients of a State ( such
as local areas) may select a one-stop
operator through sole selection when
consistent with local procurement
policies and procedures and the
Uniform Guidance set out at 2 CFR
200. 320.
b) In the event that sole source
procurement is determined necessary
and reasonable, in accordance with
678. 605( c), written documentation
must be prepared and maintained
concerning the entire process of making
such a selection.
c) Such sole source procurement
must include appropriate conflict of
interest policies and procedures. These
policies and procedures must conform
to the specifications in § 679.430 of this
chapter for demonstrating internal
controls and preventing conflict of
interest.
d) A Local WDB may be selected as
a one-stop operator through sole source
procurement only with agreement of the
chief elected official in the local area
and the Governor. The Local WDB must
establish sufficient conflict of interest
policies and procedures and these
policies and procedures must be
approved by the Governor.
678.615 May an entity currently serving
as one-stop operator compete to be a one-
stop operator under the procurement
requirements of this subpart?
a) Local WDBs may compete for and
be selected as one-stop operators, as
long as appropriate firewalls and
conflict of interest policies and
procedures are in place. These policies
and procedures must conform to the
specifications in § 679.430 of this
chapter for demonstrating internal
controls and preventing conflict of
interest.
b) State and local agencies may
compete for and be selected as one-stop
operators by the Local WDB, as long as
appropriate firewalls and conflict of
interest policies and procedures are in
place. These policies and procedures
must conform to the specifications in
679. 430 of this chapter for
demonstrating internal controls and
preventing conflict of interest.
c) In the case of single -area States
where the State WDB serves as the Local
WDB, the State agency is eligible to
compete for and be selected as operator
as long as appropriate firewalls and
conflict of interest policies are in place
and followed for the competition. These
policies and procedures must conform
to the specifications in § 679. 430 of this
chapter for demonstrating internal
controls and preventing conflicts of
interest.
678.620 What is the one-stop operator's
role?
a) At a minimum, the one-stop
operator must coordinate the service
delivery of required one-stop partners
and service providers. Local WDBs may
establish additional roles of one-stop
operator, including, but not limited to:
Coordinating service providers across
the one-stop delivery system, being the
primary provider of services within the
center, providing some of the services
within the center, or coordinating
service delivery in a multi -center area,
which may include affiliated sites. The
competition for a one-stop operator
must clearly articulate the role of the
one-stop operator.
b)( 1) Subject to paragraph (b)( 2) of
this section, a one-stop operator may not
perform the following functions:
Convene system stakeholders to assist in
the development of the local plan;
prepare and submit local plans (as
required under sec. 107 of WIOA); be
responsible for oversight of itself;
manage or significantly participate in
the competitive selection process for
one-stop operators; select or terminate
one-stop operators, career services, and
youth providers; negotiate local
performance accountability measures; or
develop and submit budget for activities
of the Local WDB in the local area.
2) An entity serving as a one-stop
operator, that also serves a different role
within the one-stop delivery system,
may perform some or all of these
functions when it is acting in its other
role, if it has established sufficient
firewalls and conflict of interest policies
and procedures. The policies and
procedures must conform to the
specifications in § 679. 430 of this
chapter for demonstrating internal
controls and preventing conflict of
interest.
678.625 Can a one-stop operator also be
a service provider?
Yes, but there must be appropriate
firewalls in place in regards to the
competition, and subsequent oversight,
monitoring, and evaluation of
performance of the service provider.
The operator cannot develop, manage,
or conduct the competition of a service
provider in which it intends to compete.
In cases where an operator is also a
service provider, there must be firewalls
and internal controls within the
operator -service provider entity, as well
as specific policies and procedures at
the Local WDB level regarding
oversight, monitoring, and evaluation of
performance of the service provider.
The firewalls must conform to the
specifications in § 679. 430 of this
chapter for demonstrating internal
controls and preventing conflicts of
interest.
678.630 Can State merit staff still work in
a one-stop center where the operator is not
a governmental entity?
Yes. State merit staff can continue to
perform functions and activities in the
one-stop center. The Local WDB and
one-stop operator must establish a
system for management of merit staff in
accordance with State policies and
procedures. Continued use of State
merit staff for the provision of Wagner-
Peyser Act services or services from
other programs with merit staffing
requirements must be included in the
competition for and final contract with
the one-stop operator when Wagner-
Peyser Act services or services from
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other programs with merit staffing system, based on such programs' a stable and equitable funding stream
requirements are being provided. for ongoing one-stop delivery systemproportionate use of such system, and
relative benefit received, consistent with operations; 678.635 What is the compliance date of
the provisions of this subpart?
a) No later than July 1, 2017, one-stop
operators selected under the
competitive process described in this
subpart must be in place and operating
the one-stop center.
b) By November 17, 2016, every
Local WDB must demonstrate it is
taking steps to prepare for competition
of its one-stop operator. This
demonstration may include, but is not
limited to, market research, requests for
information, and conducting a cost and
price analysis.
Subpart E— One-Stop Operating Costs
678.700 What are the one-stop
infrastructure costs?
a) Infrastructure costs of one-stop
centers are nonpersonnel costs that are
necessary for the general operation of
the one-stop center, including:
1) Rental of the facilities;
2) Utilities and maintenance;
3) Equipment (including assessment -
related products and assistive
technology for individuals with
disabilities); and
4) Technology to facilitate access to
the one-stop center, including
technology used for the center' s
planning and outreach activities.
b) Local WDBs may consider
common identifier costs as costs of one-
stop infrastructure.
c) Each entity that carries out a
program or activities in a local one-stop
center, described in §§678.400 through
678. 410, must use a portion of the funds
available for the program and activities
to maintain the one-stop delivery
system, including payment of the
infrastructure costs of one-stop centers.
These payments must be in accordance
with this subpart; Federal cost
principles, which require that all costs
must be allowable, reasonable,
necessary, and allocable to the program;
and all other applicable legal
requirements.
678.705 What guidance must the
Governor issue regarding one-stop
infrastructure funding?
a) The Governor, after consultation
with chief elected officials, the State
WDB, and Local WDBs, and consistent
with guidance and policies provided by
the State WDB, must develop and issue
guidance for use by local areas,
specifically:
1) Guidelines for State -administered
one-stop partner programs for
determining such programs'
contributions to a one-stop delivery
Office of Management and Budget
OMB) Uniform Administrative
Requirements, Cost Principles, and
Audit Requirements for Federal Awards
in 2 CFR part 200, including
determining funding for the costs of
infrastructure; and
2) Guidance to assist Local WDBs,
chief elected officials, and one-stop
partners in local areas in determining
equitable and stable methods of funding
the costs of infrastructure at one-stop
centers based on proportionate use and
relative benefit received, and consistent
with Federal cost principles contained
in the Uniform Guidance at 2 CFR part
200.
b) The guidance must include:
1) The appropriate roles of the one-
stop partner programs in identifying
one-stop infrastructure costs;
2) Approaches to facilitate equitable
and efficient cost allocation that results
in a reasonable cost allocation
methodology where infrastructure costs
are charged to each partner based on its
proportionate use of the one-stop
centers and relative benefit received,
consistent with Federal cost principles
at 2 CFR part 200; and
3) The timelines regarding
notification to the Governor for not
reaching local agreement and triggering
the State funding mechanism described
in § 678. 730, and timelines for a one-
stop partner to submit an appeal in the
State funding mechanism.
678.710 How are infrastructure costs
funded?
Infrastructure costs are funded either
through the local funding mechanism
described in § 678. 715 or through the
State funding mechanism described in
678. 730.
678.715 How are one-stop infrastructure
costs funded in the local funding
mechanism?
a) In the local funding mechanism,
the Local WDB, chief elected officials,
and one-stop partners agree to amounts
and methods of calculating amounts
each partner will contribute for one-stop
infrastructure funding, include the
infrastructure funding terms in the
MOU, and sign the MOU. The local
funding mechanism must meet all of the
following requirements:
1) The infrastructure costs are funded
through cash and fairly evaluated non-
cash and third -party in-kind partner
contributions and include any funding
from philanthropic organizations or
other private entities, or through other
alternative financing options, to provide
2) Contributions must be negotiated
between one-stop partners, chief elected
officials, and the Local WDB and the
amount to he contributed must he
included in the MOU;
3) The one-stop partner program' s
proportionate share of funding must be
calculated in accordance with the
Uniform Administrative Requirements,
Cost Principles, and Audit
Requirements for Federal Awards in 2
CFR part 200 based upon a reasonable
cost allocation methodology whereby
infrastructure costs are charged to each
partner in proportion to its use of the
one-stop center, relative to benefits
received. Such costs must also be
allowable, reasonable, necessary, and
allocable;
4) Partner shares must be
periodically reviewed and reconciled
against actual costs incurred, and
adjusted to ensure that actual costs
charged to any one-stop partners are
proportionate to the use of the one-stop
center and relative to the benefit
received by the one-stop partners and
their respective programs or activities.
b) In developing the section of the
MOU on one-stop infrastructure funding
described in § 678. 755, the Local WDB
and chief elected officials will:
1) Ensure that the one-stop partners
adhere to the guidance identified in
678. 705 on one-stop delivery system
infrastructure costs.
2) Work with one-stop partners to
achieve consensus and informally
mediate any possible conflicts or
disagreements among one-stop partners.
3) Provide technical assistance to
new one-stop partners and local grant
recipients to ensure that those entities
are informed and knowledgeable of the
elements contained in the MOU and the
one-stop infrastructure costs
arrangement.
c) The MOU may include an interim
infrastructure funding agreement,
including as much detail as the Local
WDB has negotiated with one-stop
partners, if all other parts of the MOU
have been negotiated, in order to allow
the partner programs to operate in the
one-stop centers. The interim
infrastructure funding agreement must
be finalized within 6 months of when
the MOU is signed. If the interim
infrastructure funding agreement is not
finalized within that timeframe, the
Local WDB must notify the Governor, as
described in § 678. 725.
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678.720 What funds are used to pay for
infrastructure costs in the local one-stop
infrastructure funding mechanism?
a) In the local funding mechanism,
one-stop partner programs may
determine what funds they will use to
pay for infrastructure costs. The use of
these funds must be in accordance with
the requirements in this subpart, and
with the relevant partner' s authorizing
statutes and regulations, including, for
example, prohibitions against
supplanting non -Federal resources,
statutory limitations on administrative
costs, and all other applicable legal
requirements. In the case of partners
administering programs authorized by
title I of WIOA, these infrastructure
costs may be considered program costs.
In the case of partners administering
adult education and literacy programs
authorized by title II of WIOA, these
funds must include Federal funds made
available for the local administration of
adult education and literacy programs
authorized by title II of WIOA. These
funds may also include non -Federal
resources that are cash, in-kind or third -
party contributions. In the case of
partners administering the Carl D.
Perkins Career and Technical Education
Act of 2006, funds used to pay for
infrastructure costs may include funds
available for local administrative
expenses, non -Federal resources that are
cash, in-kind or third -party
contributions, and may include other
funds made available by the State.
b) There are no specific caps on the
amount or percent of overall funding a
one-stop partner may contribute to fund
infrastructure costs under the local
funding mechanism, except that
contributions for administrative costs
may not exceed the amount available for
administrative costs under the
authorizing statute of the partner
program. However, amounts contributed
for infrastructure costs must be
allowable and based on proportionate
use of the one-stop centers and relative
benefit received by the partner program,
taking into account the total cost of the
one-stop infrastructure as well as
alternate financing options, and must be
consistent with 2 CFR part 200,
including the Federal cost principles.
c) Cash, non-cash, and third -party in-
kind contributions may be provided by
one-stop partners to cover their
proportionate share of infrastructure
costs.
1) Cash contributions are cash funds
provided to the Local WDB or its
designee by one-stop partners, either
directly or by an interagency transfer.
2) Non-cash contributions are
comprised of—
i) Expenditures incurred by one-stop
partners on behalf of the one-stop
center; and
ii) Non-cash contributions or goods
or services contributed by a partner
program and used by the one-stop
center.
3) Non-cash contributions, especially
those set forth in paragraph ( c)( 2)( ii) of
this section, must be valued consistent
with 2 CFR 200. 306 to ensure they are
fairly evaluated and meet the partners'
proportionate share.
4) Third -party in-kind contributions
are:
i) Contributions of space, equipment,
technology, non -personnel services, or
other like items to support the
infrastructure costs associated with one-
stop operations, by a non -one-stop
partner to support the one-stop center in
general, not a specific partner; or
ii) Contributions by a non -one-stop
partner of space, equipment,
technology, non -personnel services, or
other like items to support the
infrastructure costs associated with one-
stop operations, to a one-stop partner to
support its proportionate share of one-
stop infrastructure costs.
iii) In-kind contributions described
in paragraphs (c)(4)(i) and (ii) of this
section must he valued consistent with
2 CFR 200. 306 and reconciled on a
regular basis to ensure they are fairly
evaluated and meet the proportionate
share of the partner.
5) All partner contributions,
regardless of the type, must be
reconciled on a regular basis (i.e.,
monthly or quarterly), comparing actual
expenses incurred to relative benefits
received, to ensure each partner
program is contributing its
proportionate share in accordance with
the terms of the MOU.
678.725 What happens if consensus on
infrastructure funding is not reached at the
local level between the Local Workforce
Development Board, chief elected officials,
and one-stop partners?
With regard to negotiations for
infrastructure funding for Program Year
PY) 2017 and for each subsequent
program year thereafter, if the Local
WDB, chief elected officials, and one-
stop partners do not reach consensus on
methods of sufficiently funding local
infrastructure through the local funding
mechanism in accordance with the
Governor' s guidance issued under
678. 705 and consistent with the
regulations in §§ 678. 715 and 678. 720,
and include that consensus agreement
in the signed MOU, then the Local WDB
must notify the Governor by the
deadline established by the Governor
under § 678. 705( b)( 3). Once notified, the
Governor must administer funding
through the State funding mechanism,
as described in §§ 678. 730 through
678. 738, for the program year impacted
by the local area' s failure to reach
consensus.
678.730 What is the State one-stop
infrastructure funding mechanism?
a) Consistent with sec.
121(h)(1)( A)(i)(II) of WIOA, if the Local
WDB, chief elected official, and one-
stop partners in a local area do not reach
consensus agreement on methods of
sufficiently funding the costs of
infrastructure of one-stop centers for a
program year, the State funding
mechanism is applicable to the local
area for that program year.
b) In the State funding mechanism,
the Governor, subject to the limitations
in paragraph ( c) of this section,
determines one-stop partner
contributions after consultation with the
chief elected officials, Local WDBs, and
the State WDB. This determination
involves:
1) The application of a budget for
one-stop infrastructure costs as
described in § 678. 735, based on either
agreement reached in the local area
negotiations or the State WDB formula
outlined in § 678. 745;
2) The determination of each local
one-stop partner program' s
proportionate use of the one-stop
delivery system and relative benefit
received, consistent with the Uniform
Guidance at 2 CFR part 200, including
the Federal cost principles, the partner
programs' authorizing laws and
regulations, and other applicable legal
requirements described in § 678. 736;
and
3) The calculation of required
statewide program caps on
contributions to infrastructure costs
from one-stop partner programs in areas
operating under the State funding
mechanism as described in § 678. 738.
c) In certain situations, the Governor
does not determine the infrastructure
cost contributions for some one-stop
partner programs under the State
funding mechanism.
1) The Governor will not determine
the contribution amounts for
infrastructure funds for Native
American program grantees described in
part 684 of this chapter. The appropriate
portion of funds to be provided by
Native American program grantees to
pay for one-stop infrastructure must be
determined as part of the development
of the MOU described in § 678. 500 and
specified in that MOU.
2) In States in which the policy-
making authority is placed in an entity
or official that is independent of the
56018 Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
authority of the Governor with respect
to the funds provided for adult
education and literacy activities
authorized under title II of WIOA,
postsecondary career and technical
education activities authorized under
the Carl D. Perkins Career and Technical
Education Act of 2006, or VR services
authorized under title I of the
Rehabilitation Act of 1973 ( other than
sec. 112 or part C), as amended by
WIOA title IV, the determination of the
amount each of the applicable partners
must contribute to assist in paying the
infrastructure costs of one-stop centers
must be made by the official or chief
officer of the entity with such authority,
in consultation with the Governor.
d) Any duty, ability, choice,
responsibility, or other action otherwise
related to the determination of
infrastructure costs contributions that is
assigned to the Governor in §§678. 730
through 678. 745 also applies to this
decision-making process performed by
the official or chief officer described in
paragraph (c)( 2) of this section.
678.731 What are the steps to determine
the amount to be paid under the State one-
stop infrastructure funding mechanism?
a) To initiate the State funding
mechanism, a Local WDB that has not
reached consensus on methods of
sufficiently funding local infrastructure
through the local funding mechanism as
provided in § 678. 725 must notify the
Governor by the deadline established by
the Governor under § 678. 705( b)( 3).
b) Once a Local WDB has informed
the Governor that no consensus has
been reached:
1) The Local WDB must provide the
Governor with local negotiation
materials in accordance with
678. 735( a).
2) The Governor must determine the
one-stop center budget by either:
i) Accepting a budget previously
agreed upon by partner programs in the
local negotiations, in accordance with
678. 735( b)( 1); or
ii) Creating a budget for the one-stop
center using the State WDB formula
described in § 678. 745) in accordance
with §678. 735( b)( 3).
3) The Governor then must establish
a cost allocation methodology to
determine the one-stop partner
programs' proportionate shares of
infrastructure costs, in accordance with
678. 736.
4)( i) Using the methodology
established under paragraph (b)( 2)( ii) of
this section, and taking into
consideration the factors concerning
individual partner programs listed in
678. 737(b)( 2), the Governor must
determine each partner' s proportionate
share of the infrastructure costs, in
accordance with § 678. 737( b)( 1), and
ii) In accordance with §678. 730( c), in
some instances, the Governor does not
determine a partner program' s
proportionate share of infrastructure
funding costs, in which case it must be
determined by the entities named in
678. 730( c)( 1) and ( 2).
5) The Governor must then calculate
the statewide caps on the amounts that
partner programs may be required to
contribute toward infrastructure
funding, according to the steps found at
678. 738( a)( 1) through (4).
6) The Governor must ensure that the
aggregate total of the infrastructure
contributions according to proportionate
share required of all local partner
programs in local areas under the State
funding mechanism do not exceed the
cap for that particular program, in
accordance with §678. 738( b)( 1). If the
total does not exceed the cap, the
Governor must direct each one-stop
partner program to pay the amount
determined under § 678. 737( a) toward
the infrastructure funding costs of the
one-stop center. If the total does exceed
the cap, then to determine the amount
to direct each one-stop program to pay,
the Governor may:
i) Ascertain, in accordance with
678. 738(b)( 2)( i),whether the local
partner or partners whose proportionate
shares are calculated above the
individual program caps are willing to
voluntarily contribute above the capped
amount to equal that program' s
proportionate share; or
ii) Choose from the options provided
in § 678. 738( b)( 2)( ii), including having
the local area re-enter negotiations to
reassess each one-stop partner' s
proportionate share and make
adjustments or identify alternate sources
of funding to make up the difference
between the capped amount and the
proportionate share of infrastructure
funding of the one-stop partner.
7) If none of the solutions given in
paragraphs (b)( 6)( i) and (ii) of this
section prove to be viable, the Governor
must reassess the proportionate shares
of each one-stop partner so that the
aggregate amount attributable to the
local partners for each program is less
than that program' s cap amount. Upon
such reassessment, the Governor must
direct each one-stop partner program to
pay the reassessed amount toward the
infrastructure funding costs of the one-
stop center.
678.735 How are infrastructure cost
budgets for the one-stop centers in a local
area determined in the State one-stop
infrastructure funding mechanism?
a) Local WDBs must provide to the
Governor appropriate and relevant
materials and documents used in the
negotiations under the local funding
mechanism, including but not limited
to: The local WIOA plan, the cost
allocation method or methods proposed
by the partners to be used in
determining proportionate share, the
proposed amounts or budget to fund
infrastructure, the amount of total
partner funds included, the type of
funds or non-cash contributions,
proposed one-stop center budgets, and
any agreed upon or proposed MOUs.
b)( 1) If a local area has reached
agreement as to the infrastructure
budget for the one-stop centers in the
local area, it must provide this budget
to the Governor as required by
paragraph (a) of this section. If, as a
result of the agreed upon infrastructure
budget, only the individual
programmatic contributions to
infrastructure funding based upon
proportionate use of the one-stop
centers and relative benefit received are
at issue, the Governor may accept the
budget, from which the Governor must
calculate each partner' s contribution
consistent with the cost allocation
methodologies contained in the Uniform
Guidance found in 2 CFR part 200, as
described in § 678. 736.
2) The Governor may also take into
consideration the extent to which the
partners in the local area have agreed in
determining the proportionate shares,
including any agreements reached at the
local level by one or more partners, as
well as any other element or product of
the negotiating process provided to the
Governor as required by paragraph (a) of
this section.
3) If a local area has not reached
agreement as to the infrastructure
budget for the one-stop centers in the
local area, or if the Governor determines
that the agreed upon budget does not
adequately meet the needs of the local
area or does not reasonably work within
the confines of the local area' s resources
in accordance with the Governor' s one-
stop budget guidance (which is required
to be issued by WIOA sec. 121( h)(1)( B)
and under § 678. 705), then, in
accordance with §678. 745, the
Governor must use the formula
developed by the State WDB based on
at least the factors required under
678. 745, and any associated weights to
determine the local area budget.
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678.736 How does the Governor
establish a cost allocation methodology
used to determine the one-stop partner
programs' proportionate shares of
infrastructure costs under the State one-
stop infrastructure funding mechanism?
Once the appropriate budget is
determined for a local area through
either method described in § 678. 735
by acceptance of a budget agreed upon
in local negotiation or by the Governor
applying the formula detailed in
678. 745), the Governor must
determine the appropriate cost
allocation methodology to be applied to
the one-stop partners in such local area,
consistent with the Federal cost
principles permitted under 2 CFR part
200, to fund the infrastructure budget.
678.737 How are one-stop partner
programs' proportionate shares of
infrastructure costs determined under the
State one-stop infrastructure funding
mechanism?
a) The Governor must direct the one-
stop partners in each local area that
have not reached agreement under the
local funding mechanism to pay what
the Governor determines is each partner
program' s proportionate share of
infrastructure funds for that area,
subject to the application of the caps
described in § 678. 738.
b)( 1) The Governor must use the cost
allocation methodology—as determined
under § 678. 736— to determine each
partner' s proportionate share of the
infrastructure costs under the State
funding mechanism, subject to
considering the factors described in
paragraph (b)( 2) of this section.
2) In determining each partner
program' s proportionate share of
infrastructure costs, the Governor must
take into account the costs of
administration of the one-stop delivery
system for purposes not related to one-
stop centers for each partner (such as
costs associated with maintaining the
Local WDB or information technology
systems), as well as the statutory
requirements for each partner program,
the partner program' s ability to fulfill
such requirements, and all other
applicable legal requirements. The
Governor may also take into
consideration the extent to which the
partners in the local area have agreed in
determining the proportionate shares,
including any agreements reached at the
local level by one or more partners, as
well as any other materials or
documents of the negotiating process,
which must be provided to the Governor
by the Local WDB and described in
678. 735( a).
678.738 How are statewide caps on the
contributions for one-stop infrastructure
funding determined in the State one-stop
infrastructure funding mechanism?
a) The Governor must calculate the
statewide cap on the contributions for
one-stop infrastructure funding required
to be provided by each one-stop partner
program for those local areas that have
not reached agreement. The cap is the
amount determined under paragraph
a)( 4) of this section, which the
Governor derives by:
1) First, determining the amount
resulting from applying the percentage
for the corresponding one-stop partner
program provided in paragraph (d) of
this section to the amount of Federal
funds provided to carry out the one-stop
partner program in the State for the
applicable fiscal year;
2) Second, selecting a factor (or
factors) that reasonably indicates the use
of one-stop centers in the State,
applying such factor(s) to all local areas
in the State, and determining the
percentage of such factor(s) applicable
to the local areas that reached agreement
under the local funding mechanism in
the State;
3) Third, determining the amount
resulting from applying the percentage
determined in paragraph (a)( 2) of this
section to the amount determined under
paragraph (a)( 1) of this section for the
one-stop partner program; and
4) Fourth, determining the amount
that results from subtracting the amount
determined under paragraph (a)( 3) of
this section from the amount
determined under paragraph (a)( 1) of
this section. The outcome of this final
calculation results in the partner
program' s cap.
b)( 1) The Governor must ensure that
the funds required to be contributed by
each partner program in the local areas
in the State under the State funding
mechanism, in aggregate, do not exceed
the statewide cap for each program as
determined under paragraph (a) of this
section.
2) If the contributions initially
determined under § 678. 737 would
exceed the applicable cap determined
under paragraph (a) of this section, the
Governor may:
i) Ascertain if the one-stop partner
whose contribution would otherwise
exceed the cap determined under
paragraph (a) of this section will
voluntarily contribute above the capped
amount, so that the total contributions
equal that partner' s proportionate share.
The one-stop partner' s contribution
must still be consistent with the
program' s authorizing laws and
regulations, the Federal cost principles
in 2 CFR part 200, and other applicable
legal requirements; or
ii)Direct or allow the Local WDB,
chief elected officials, and one-stop
partners to: Re-enter negotiations, as
necessary; reduce the infrastructure
costs to reflect the amount of funds that
are available for such costs without
exceeding the cap levels; reassess the
proportionate share of each one-stop
partner; or identify alternative sources
of financing for one-stop infrastructure
funding, consistent with the
requirement that each one-stop partner
pay an amount that is consistent with
the proportionate use of the one-stop
center and relative benefit received by
the partner, the program' s authorizing
laws and regulations, the Federal cost
principles in 2 CFR part 200, and other
applicable legal requirements.
3) If applicable under paragraph
b)( 2)( ii) of this section, the Local WDB,
chief elected officials, and one-stop
partners, after renegotiation, may come
to agreement, sign an MOU, and
proceed under the local funding
mechanism. Such actions do not require
the redetermination of the applicable
caps under paragraph (a) of this section.
4) If, after renegotiation, agreement
among partners still cannot be reached
or alternate financing cannot be
identified, the Governor may adjust the
specified allocation, in accordance with
the amounts available and the
limitations described in paragraph (d) of
this section. In determining these
adjustments, the Governor may take into
account information relating to the
renegotiation as well as the information
described in § 678. 735( a).
c) Limitations. Subject to paragraph
a) of this section and in accordance
with WIOA sec. 121( h)(2)( D), the
following limitations apply to the
Governor' s calculations of the amount
that one-stop partners in local areas that
have not reached agreement under the
local funding mechanism may be
required under § 678. 736 to contribute
to one-stop infrastructure funding:
1) WIOA formula programs and
Wagner-Peyser Act Employment Service.
The portion of funds required to be
contributed under the WIOA youth,
adult, or dislocated worker programs, or
under the Wagner-Peyser Act (29 U.S.C.
49 et seq.) must not exceed three
percent of the amount of the program in
the State for a program year.
2) Other one-stop partners. For
required one-stop partners other than
those specified in paragraphs ( c)( 1), ( 3),
5), and (6) of this section, the portion
of funds required to be contributed must
not exceed 1. 5 percent of the amount of
Federal funds provided to carry out that
program in the State for a fiscal year.
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For purposes of the Carl D. Perkins
Career and Technical Education Act of
2006, the cap on contributions is
determined based on the funds made
available by the State for postsecondary
level programs and activities under sec.
132 of the Carl D. Perkins Career and
Technical Education Act and the
amount of funds used by the State under
sec. 112( a)( 3) of the Perkins Act during
the prior year to administer
postsecondary level programs and
activities, as applicable.
3) Vocational rehabilitation. (i)
Within a State, for the entity or entities
administering the programs described in
WIOA sec. 121( b)( 1)( B)( iv) and
678.400, the allotment is based on the
one State Federal fiscal year allotment,
even in instances where that allotment
is shared between two State agencies,
and the cumulative portion of funds
required to be contributed must not
exceed—
A) 0. 75 percent of the amount of
Federal funds provided to carry out
such program in the State for Fiscal
Year 2016 for purposes of applicability
of the State funding mechanism for PY
2017;
B) 1. 0 percent of the amount
provided to carry out such program in
the State for Fiscal Year 2017 for
purposes of applicability of the State
funding mechanism for PY 2018;
C) 1. 25 percent of the amount
provided to carry out such program in
the State for Fiscal Year 2018 for
purposes of applicability of the State
funding mechanism for PY 2019;
D) 1. 5 percent of the amount
provided to carry out such program in
the State for Fiscal Year 2019 and
following years for purposes of
applicability of the State funding
mechanism for PY 2020 and subsequent
years.
ii) The limitations set forth in
paragraph (d)( 3)( i) of this section for any
given fiscal year must be based on the
final VR allotment to the State in the
applicable Federal fiscal year.
4) Federal direct spending programs.
For local areas that have not reached a
one-stop infrastructure funding
agreement by consensus, an entity
administering a program funded with
direct Federal spending, as defined in
sec. 250( c)( 8) of the Balanced Budget
and Emergency Deficit Control Act of
1985, as in effect on February 15, 2014
2 U.S. C. 900( c)( 8)), must not be
required to provide more for
infrastructure costs than the amount
that the Governor determined (as
described in § 678. 737).
5) TANF programs. For purposes of
TANF, the cap on contributions is
determined based on the total Federal
TANF funds expended by the State for
work, education, and training activities
during the prior Federal fiscal year (as
reported to the Department of Health
and Human Services ( HHS) on the
quarterly TANF Financial Report form),
plus any additional amount of Federal
TANF funds that the State TANF agency
reasonably determines was expended
for administrative costs in connection
with these activities hut that was
separately reported to HHS as an
administrative cost. The State' s
contribution to the one-stop
infrastructure must not exceed 1. 5
percent of these combined expenditures.
6) Community Services Block Grant
CSBG) programs. For purposes of
CSBG, the cap on contributions will be
based on the total amount of CSBG
funds determined by the State to have
been expended by local CSBG-eligible
entities for the provision of employment
and training activities during the prior
Federal fiscal year for which
information is available ( as reported to
HHS on the CSBG Annual Report) and
any additional amount that the State
CSBG agency reasonably determines
was expended for administrative
purposes in connection with these
activities and was separately reported to
HHS as an administrative cost. The
State' s contribution must not exceed 1. 5
percent of these combined expenditures.
d) For programs for which it is not
otherwise feasible to determine the
amount of Federal funding used by the
program until the end of that program' s
operational year—because, for example,
the funding available for education,
employment, and training activities is
included within funding for the
program that may also be used for other
unrelated activities—the determination
of the Federal funds provided to carry
out the program for a fiscal year under
paragraph (a)( 1) of this section may be
determined by:
1) The percentage of Federal funds
available to the one-stop partner
program that were used by the one-stop
partner program for education,
employment, and training activities in
the previous fiscal year for which data
are available; and
2) Applying the percentage
determined under paragraph (d)( 1) of
this section to the total amount of
Federal funds available to the one-stop
partner program for the fiscal year for
which the determination under
paragraph (a)( 1) of this section applies.
678.740 What funds are used to pay for
infrastructure costs in the State one-stop
infrastructure funding mechanism?
a) In the State funding mechanism,
infrastructure costs for WIOA title I
programs, including Native American
Programs described in part 684 of this
chapter, may be paid using program
funds, administrative funds, or both.
Infrastructure costs for the Senior
Community Service Employment
Program under title V of the Older
Americans Act (42 U.S. C. 3056 et seq.)
may also be paid using program funds,
administrative funds, or both.
b) In the State funding mechanism,
infrastructure costs for other required
one-stop partner programs (listed in
678.400 through 678.410) are limited
to the program' s administrative funds,
as appropriate.
c) In the State funding mechanism,
infrastructure costs for the adult
education program authorized by title II
of WIOA must be paid from the funds
that are available for local
administration and may be paid from
funds made available by the State or
non -Federal resources that are cash, in-
kind, or third -party contributions.
d) In the State funding mechanism,
infrastructure costs for the Carl D.
Perkins Career and Technical Education
Act of 2006 must be paid from funds
available for local administration of
postsecondary level programs and
activities to eligible recipients or
consortia of eligible recipients and may
be paid from funds made available by
the State or non -Federal resources that
are cash, in-kind, or third -party
contributions.
678.745 What factors does the State
Workforce Development Board use to
develop the formula described in Workforce
Innovation and Opportunity Act, which is
used by the Governor to determine the
appropriate one-stop infrastructure budget
for each local area operating under the
State infrastructure funding mechanism, if
no reasonably implementable locally
negotiated budget exists?
The State WDB must develop a
formula, as described in WIOA sec.
121(h)(3)( B), to be used by the Governor
under § 678. 735( b)( 3) in determining the
appropriate budget for the infrastructure
costs of one-stop centers in the local
areas that do not reach agreement under
the local funding mechanism and are,
therefore, subject to the State funding
mechanism. The formula identifies the
factors and corresponding weights for
each factor that the Governor must use,
which must include: The number of
one-stop centers in a local area; the
population served by such centers; the
services provided by such centers; and
any factors relating to the operations of
such centers in the local area that the
State WDB determines are appropriate.
As indicated in § 678. 735( b)( 1), if the
local area has agreed on such a budget,
56021Federal Register / Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
the Governor may accept that budget in
lieu of applying the formula factors.
678.750 When and how can a one-stop
partner appeal a one-stop infrastructure
amount designated by the State under the
State infrastructure funding mechanism?
a) The Governor must establish a
process, described under sec.
121(h)(2)( E) of WIOA, for a one-stop
partner administering a program
described in §§678.400 through 678.410
to appeal the Governor' s determination
regarding the one-stop partner' s portion
of funds to be provided for one-stop
infrastructure costs. This appeal process
must be described in the Unified State
Plan.
b) The appeal may be made on the
ground that the Governor' s
determination is inconsistent with
proportionate share requirements in
678. 735( a), the cost contribution
limitations in § 678. 735( b), the cost
contribution caps in § 678. 738,
consistent with the process described in
the State Plan.
c) The process must ensure prompt
resolution of the appeal in order to
ensure the funds are distributed in a
timely manner, consistent with the
requirements of §683. 630 of this
chapter.
d) The one-stop partner must submit
an appeal in accordance with State' s
deadlines for appeals specified in the
guidance issued under § 678. 705( b)( 3),
or if the State has not set a deadline,
within 21 days from the Governor' s
determination.
678.755 What are the required elements
regarding infrastructure funding that must
be included in the one-stop Memorandum
of Understanding?
The MOU, fully described in
678. 500, must contain the following
information whether the local areas use
either the local one-stop or the State
funding method:
a) The period of time in which this
infrastructure funding agreement is
effective. This may be a different time
period than the duration of the MOU.
b) Identification of an infrastructure
and shared services budget that will be
periodically reconciled against actual
costs incurred and adjusted accordingly
to ensure that it reflects a cost allocation
methodology that demonstrates how
infrastructure costs are charged to each
partner in proportion to its use of the
one-stop center and relative benefit
received, and that complies with 2 CFR
part 200 ( or any corresponding similar
regulation or ruling).
c) Identification of all one-stop
partners, chief elected officials, and
Local WDB participating in the
infrastructure funding arrangement.
d) Steps the Local WDB, chief elected
officials, and one-stop partners used to
reach consensus or an assurance that the
local area followed the guidance for the
State funding process.
e) Description of the process to be
used among partners to resolve issues
during the MOU duration period when
consensus cannot he reached.
f) Description of the periodic
modification and review process to
ensure equitable benefit among one-stop
partners.
678.760 How do one-stop partners jointly
fund other shared costs under the
Memorandum of Understanding?
a) In addition to jointly funding
infrastructure costs, one-stop partners
listed in §§678.400 through 678.410
must use a portion of funds made
available under their programs'
authorizing Federal law (or fairly
evaluated in-kind contributions) to pay
the additional costs relating to the
operation of the one-stop delivery
system. These other costs must include
applicable career services and may
include other costs, including shared
services.
b) For the purposes of paragraph (a)
of this section, shared services' costs
may include the costs of shared services
that are authorized for and may be
commonly provided through the one-
stop partner programs to any individual,
such as initial intake, assessment of
needs, appraisal of basic skills,
identification of appropriate services to
meet such needs, referrals to other one-
stop partners, and business services.
Shared operating costs may also include
shared costs of the Local WDB' s
functions.
c) Contributions to the additional
costs related to operation of the one-stop
delivery system may be cash, non-cash,
or third -party in-kind contributions,
consistent with how these are described
in § 678. 720( c).
d) The shared costs described in
paragraph (a) of this section must be
allocated according to the proportion of
benefit received by each of the partners,
consistent with the Federal law
authorizing the partner' s program, and
consistent with all other applicable legal
requirements, including Federal cost
principles in 2 CFR part 200 ( or any
corresponding similar regulation or
ruling) requiring that costs are
allowable, reasonable, necessary, and
allocable.
e) Any shared costs agreed upon by
the one-stop partners must be included
in the MOU.
Subpart F— One-Stop Certification
678.800 How are one-stop centers and
one-stop delivery systems certified for
effectiveness, physical and programmatic
accessibility, and continuous
improvement?
a) The State WDB, in consultation
with chief elected officials and Local
WDBs, must establish objective criteria
and procedures for Local WDBs to use
when certifying one-stop centers.
1) The State WDB, in consultation
with chief elected officials and Local
WDBs, must review and update the
criteria every 2 years as part of the
review and modification of State Plans
pursuant to § 676. 135 of this chapter.
2) The criteria must be consistent
with the Governor' s and State WDB' s
guidelines, guidance, and policies on
infrastructure funding decisions,
described in § 678. 705. The criteria
must evaluate the one-stop centers and
one-stop delivery system for
effectiveness, including customer
satisfaction, physical and programmatic
accessibility, and continuous
improvement.
3) When the Local WDB is the one-
stop operator as described in § 679.410
of this chapter, the State WDB must
certify the one-stop center.
b) Evaluations of effectiveness must
include how well the one-stop center
integrates available services for
participants and businesses, meets the
workforce development needs of
participants and the employment needs
of local employers, operates in a cost-
efficient manner, coordinates services
among the one-stop partner programs,
and provides access to partner program
services to the maximum extent
practicable, including providing
services outside of regular business
hours where there is a workforce need,
as identified by the Local WDB. These
evaluations must take into account
feedback from one-stop customers. They
must also include evaluations of how
well the one-stop center ensures equal
opportunity for individuals with
disabilities to participate in or benefit
from one-stop center services. These
evaluations must include criteria
evaluating how well the centers and
delivery systems take actions to comply
with the disability -related regulations
implementing WIOA sec. 188, set forth
at 29 CFR part 38. Such actions include,
but are not limited to:
1) Providing reasonable
accommodations for individuals with
disabilities;
2) Making reasonable modifications
to policies, practices, and procedures
where necessary to avoid discrimination
against persons with disabilities;
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3) Administering programs in the
most integrated setting appropriate;
4) Communicating with persons with
disabilities as effectively as with others;
5) Providing appropriate auxiliary
aids and services, including assistive
technology devices and services, where
necessary to afford individuals with
disabilities an equal opportunity to
participate in, and enjoy the benefits of,
the program or activity; and
6) Providing for the physical
accessibility of the one-stop center to
individuals with disabilities.
c) Evaluations of continuous
improvement must include how well
the one-stop center supports the
achievement of the negotiated local
levels of performance for the indicators
of performance for the local area
described in sec. 116(b)( 2) of WIOA and
part 677 of this chapter. Other
continuous improvement factors may
include a regular process for identifying
and responding to technical assistance
needs, a regular system of continuing
professional staff development, and
having systems in place to capture and
respond to specific customer feedback.
d) Local WDBs must assess at least
once every 3 years the effectiveness,
physical and programmatic
accessibility, and continuous
improvement of one-stop centers and
the one-stop delivery systems using the
criteria and procedures developed by
the State WDB. The Local WDB may
establish additional criteria, or set
higher standards for service
coordination, than those set by the State
criteria. Local WDBs must review and
update the criteria every 2 years as part
of the Local Plan update process
described in § 676. 580 of this chapter.
Local WDBs must certify one-stop
centers in order to be eligible to use
infrastructure funds in the State funding
mechanism described in § 678. 730.
e) All one-stop centers must comply
with applicable physical and
programmatic accessibility
requirements, as set forth in 29 CFR part
38, the implementing regulations of
WIOA sec. 188.
Subpart G— Common Identifier
678.900 What is the common identifier to
be used by each one-stop delivery system?
a) The common one-stop delivery
system identifier is " American Job
Center."
b) As of November 17, 2016, each
one-stop delivery system must include
the " American Job Center" identifier or
a proud partner of the American Job
Center network" on all primary
electronic resources used by the one-
stop delivery system, and on any newly
printed, purchased, or created materials.
c) As of July 1, 2017, each one-stop
delivery system must include the
American Job Center" identifier or " a
proud partner of the American Job
Center network" on all products,
programs, activities, services, electronic
resources, facilities, and related
property and new materials used in the
one-stop delivery system.
d) One-stop partners, States, or local
areas may use additional identifiers on
their products, programs, activities,
services, facilities, and related property
and materials.
Department of Education
34 CFR Chapters III and IV
For the reasons stated in the
preamble, the Department of Education
amends 34 CFR chapters III and IV as
follows:
PART 361— STATE VOCATIONAL
REHABILITATION SERVICES
PROGRAM
4. The authority citation for part 361
continues to read as follows:
Authority: 29 U. S. C. 709( c), unless
otherwise noted.
5. Add subpart D to part 361 to read
as follows:
Subpart D— Unified and Combined State
Plans Under Title I of the Workforce
Innovation and Opportunity Act
Sec.
361. 100 What are the purposes of the
Unified and Combined State Plans?
361. 105 What are the general requirements
for the Unified State Plan?
361. 110 What are the program -specific
requirements in the Unified State Plan
for the adult, dislocated worker, and
youth programs authorized under
Workforce Innovation and Opportunity
Act title I?
361. 115 What are the program -specific
requirements in the Unified State Plan
for the Adult Education and Family
Literacy Act program authorized under
Workforce Innovation and Opportunity
Act title II?
361. 120 What are the program -specific
requirements in the Unified State Plan
for the Employment Service program
authorized under the Wagner-Peyser Act,
as amended by Workforce Innovation
and Opportunity Act title III?
361. 125 What are the program -specific
requirements in the Unified State Plan
for the State Vocational Rehabilitation
program authorized under title I of the
Rehabilitation Act of 1973, as amended
by Workforce Innovation and
Opportunity Act title IV?
361. 130 What is the development,
submission, and approval process of the
Unified State Plan?
361. 135 What are the requirements for
modification of the Unified State Plan?
361. 140 What are the general requirements
for submitting a Combined State Plan?
361. 143 What is the development,
submission, and approval process of the
Combined State Plan?
361. 145 What are the requirements for
modifications of the Combined State
Plan?
Authority: Secs. 102, 103, and 503, Pub. L.
113-128, 128 Stat. 1425 ( Jul. 22, 2014).
Subpart D— Unified and Combined
State Plans Under Title I of the
Workforce Innovation and Opportunity
Act
361. 100 What are the purposes of the
Unified and Combined State Plans?
a) The Unified and Combined State
Plans provide the framework for States
to outline a strategic vision of, and goals
for, how their workforce development
systems will achieve the purposes of the
Workforce Innovation and Opportunity
Act (WIOA).
b) The Unified and Combined State
Plans serve as 4 -year action plans to
develop, align, and integrate the State' s
systems and provide a platform to
achieve the State' s vision and strategic
and operational goals. A Unified or
Combined State Plan is intended to:
1) Align, in strategic coordination,
the six core programs required in the
Unified State Plan pursuant to
361. 105(b), and additional Combined
State Plan partner programs that may be
part of the Combined State Plan
pursuant to § 361. 140;
2) Direct investments in economic,
education, and workforce training
programs to focus on providing relevant
education and training to ensure that
individuals, including youth and
individuals with barriers to
employment, have the skills to compete
in the job market and that employers
have a ready supply of skilled workers;
3) Apply strategies for job -driven
training consistently across Federal
programs; and
4) Enable economic, education, and
workforce partners to build a skilled
workforce through innovation in, and
alignment of, employment, training, and
education programs.
361. 105 What are the general
requirements for the Unified State Plan?
a) The Unified State Plan must be
submitted in accordance with § 361. 130
and WIOA sec. 102( c), as explained in
joint planning guidelines issued by the
Secretaries of Labor and Education.
b) The Governor of each State must
submit, at a minimum, in accordance
with § 361. 130, a Unified State Plan to
the Secretary of Labor to be eligible to
receive funding for the workforce
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development system' s six core
programs:
1) The adult, dislocated worker, and
youth programs authorized under
subtitle B of title I of WIOA and
administered by the U.S. Department of
Labor (DOL);
2) The Adult Education and Family
Literacy Act (AEFLA) program
authorized under title II of WIOA and
administered by the U.S. Department of
Education (ED);
3) The Employment Service program
authorized under the Wagner-Peyser Act
of 1933, as amended by WIOA title III
and administered by DOL; and
4) The Vocational Rehabilitation
program authorized under title I of the
Rehabilitation Act of 1973, as amended
by title IV of WIOA and administered by
ED.
c) The Unified State Plan must
outline the State' s 4 -year strategy for the
core programs described in paragraph
b) of this section and meet the
requirements of sec. 102(b) of WIOA, as
explained in the joint planning
guidelines issued by the Secretaries of
Labor and Education.
d) The Unified State Plan must
include strategic and operational
planning elements to facilitate the
development of an aligned, coordinated,
and comprehensive workforce
development system. The Unified State
Plan must include:
1) Strategic planning elements that
describe the State' s strategic vision and
goals for preparing an educated and
skilled workforce under sec. 102( b)( 1) of
WIOA. The strategic planning elements
must be informed by and include an
analysis of the State' s economic
conditions and employer and workforce
needs, including education and skill
needs.
2) Strategies for aligning the core
programs and Combined State Plan
partner programs as described in
361. 140( d), as well as other resources
available to the State, to achieve the
strategic vision and goals in accordance
with sec. 102( b)( 1)( E) of WIOA.
3) Operational planning elements in
accordance with sec. 102( b)( 2) of WIOA
that support the strategies for aligning
the core programs and other resources
available to the State to achieve the
State' s vision and goals and a
description of how the State Workforce
Development Board (WDB) will
implement its functions, in accordance
with sec. 101( d) of WIOA. Operational
planning elements must include:
i) A description of how the State
strategy will be implemented by each
core program' s lead State agency;
ii) State operating systems, including
data systems, and policies that will
support the implementation of the
State' s strategy identified in paragraph
d)(1) of this section;
iii) Program -specific requirements for
the core programs required by WIOA
sec. 102(b)( 2)( D);
iv) Assurances required by sec.
102( b)( 2)( E) of WIOA, including an
assurance that the lead State agencies
responsible for the administration of the
core programs reviewed and commented
on the appropriate operational planning
of the Unified State Plan and approved
the elements as serving the needs of the
population served by such programs,
and other assurances deemed necessary
by the Secretaries of Labor and
Education under sec. 102( b)( 2)( E)( x) of
WIOA;
v) A description of joint planning
and coordination across core programs,
required one-stop partner programs, and
other programs and activities in the
Unified State Plan; and
vi) Any additional operational
planning requirements imposed by the
Secretary of Labor or the Secretary of
Education under sec. 102(b)( 2)( C)(viii)
of WIOA.
e) All of the requirements in this
subpart that apply to States also apply
to outlying areas.
361. 110 What are the program -specific
requirements in the Unified State Plan for
the adult, dislocated worker, and youth
programs authorized under Workforce
Innovation and Opportunity Act title I?
The program -specific requirements for
the adult, dislocated worker, and youth
programs that must be included in the
Unified State Plan are described in sec.
102(b)( 2)( D) of WIOA. Additional
planning requirements may be
explained in joint planning guidelines
issued by the Secretaries of Labor and
Education.
361. 115 What are the program -specific
requirements in the Unified State Plan for
the Adult Education and Family Literacy Act
program authorized under Workforce
Innovation and Opportunity Act title II?
The program -specific requirements for
the AEFLA program in title II that must
be included in the Unified State Plan
are described in secs. 102( b)( 2)( C) and
102(b)( 2)( D)(ii) of WIOA.
a) With regard to the description
required in sec. 102( b)( 2)( D)( ii)(I) of
WIOA pertaining to content standards,
the Unified State Plan must describe
how the eligible agency will, by July 1,
2016, align its content standards for
adult education with State -adopted
challenging academic content standards
under the Elementary and Secondary
Education Act of 1965, as amended.
b) With regard to the description
required in sec. 102( b)( 2)( C)( iv) of
WIOA pertaining to the methods and
factors the State will use to distribute
funds under the core programs, for title
II of WIOA, the Unified State Plan must
include—
1) How the eligible agency will
award multi-year grants on a
competitive basis to eligible providers
in the State; and
2) How the eligible agency will
provide direct and equitable access to
funds using the same grant or contract
announcement and application
procedure.
361. 120 What are the program -specific
requirements in the Unified State Plan for
the Employment Service program
authorized under the Wagner-Peyser Act, as
amended by Workforce Innovation and
Opportunity Act title III?
The Employment Service program
authorized under the Wagner-Peyser Act
of 1933, as amended by WIOA title III,
is subject to requirements in sec. 102( b)
of WIOA, including any additional
requirements imposed by the Secretary
of Labor under secs. 102(b)( 2)( C)(viii)
and 102( b)( 2)( D)( iv) of WIOA, as
explained in joint planning guidelines
issued by the Secretaries of Labor and
Education.
361. 125 What are the program -specific
requirements in the Unified State Plan for
the State Vocational Rehabilitation program
authorized under title I of the Rehabilitation
Act of 1973, as amended by Workforce
Innovation and Opportunity Act title IV?
The program specific -requirements for
the vocational rehabilitation services
portion of the Unified or Combined
State Plan are set forth in sec. 101( a) of
the Rehabilitation Act of 1973, as
amended. All submission requirements
for the vocational rehabilitation services
portion of the Unified or Combined
State Plan are in addition to the jointly
developed strategic and operational
content requirements prescribed by sec.
102( b) of WIOA.
361. 130 What is the development,
submission, and approval process of the
Unified State Plan?
a) The Unified State Plan described
in § 361. 105 must be submitted in
accordance with WIOA sec. 102( c), as
explained in joint planning guidelines
issued jointly by the Secretaries of Labor
and Education.
b) A State must submit its Unified
State Plan to the Secretary of Labor
pursuant to a process identified by the
Secretary.
1) The initial Unified State Plan must
be submitted no later than 120 days
prior to the commencement of the
second full program year of WIOA.
2) Subsequent Unified State Plans
must be submitted no later than 120
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days prior to the end of the 4 -year
period covered by a preceding Unified
State Plan.
3) For purposes of paragraph (b) of
this section, " program year" means July
1 through June 30 of any year.
c) The Unified State Plan must be
developed with the assistance of the
State WDB, as required by 20 CFR
679. 130( a) and WIOA sec. 101( d), and
must be developed in coordination with
administrators with optimum policy-
making authority for the core programs
and required one-stop partners.
d) The State must provide an
opportunity for public comment on and
input into the development of the
Unified State Plan prior to its
submission.
1) The opportunity for public
comment must include an opportunity
for comment by representatives of Local
WDBs and chief elected officials,
businesses, representatives of labor
organizations, community-based
organizations, adult education
providers, institutions of higher
education, other stakeholders with an
interest in the services provided by the
six core programs, and the general
public, including individuals with
disabilities.
2) Consistent with the " Sunshine
Provision" of WIOA in sec. 101( g), the
State WDB must make information
regarding the Unified State Plan
available to the public through
electronic means and regularly
occurring open meetings in accordance
with State law. The Unified State Plan
must describe the State' s process and
timeline for ensuring a meaningful
opportunity for public comment.
e) Upon receipt of the Unified State
Plan from the State, the Secretary of
Labor will ensure that the entire Unified
State Plan is submitted to the Secretary
of Education pursuant to a process
developed by the Secretaries.
f) The Unified State Plan is subject to
the approval of both the Secretary of
Labor and the Secretary of Education.
g) Before the Secretaries of Labor and
Education approve the Unified State
Plan, the vocational rehabilitation
services portion of the Unified State
Plan described in WIOA sec.
102(b)(2)( D)(iii) must be approved by
the Commissioner of the Rehabilitation
Services Administration.
h) The Secretaries of Labor and
Education will review and approve the
Unified State Plan within 90 days of
receipt by the Secretary of Labor, unless
the Secretary of Labor or the Secretary
of Education determines in writing
within that period that:
1) The plan is inconsistent with a
core program' s requirements;
2) The Unified State Plan is
inconsistent with any requirement of
sec. 102 of WIOA; or
3) The plan is incomplete or
otherwise insufficient to determine
whether it is consistent with a core
program' s requirements or other
requirements of WIOA.
i) If neither the Secretary of Labor nor
the Secretary of Education makes the
written determination described in
paragraph (h) of this section within 90
days of the receipt by the Secretaries,
the Unified State Plan will be
considered approved.
361. 135 What are the requirements for
modification of the Unified State Plan?
a) In addition to the required
modification review set forth in
paragraph (b) of this section, a Governor
may submit a modification of its Unified
State Plan at any time during the 4 -year
period of the plan.
b) Modifications are required, at a
minimum:
1) At the end of the first 2 -year
period of any 4 -year State Plan, wherein
the State WDB must review the Unified
State Plan, and the Governor must
submit modifications to the plan to
reflect changes in labor market and
economic conditions or other factors
affecting the implementation of the
Unified State Plan;
2) When changes in Federal or State
law or policy substantially affect the
strategies, goals, and priorities upon
which the Unified State Plan is based;
3) When there are changes in the
statewide vision, strategies, policies,
State negotiated levels of performance
as described in § 361. 170(b), the
methodology used to determine local
allocation of funds, reorganizations that
change the working relationship with
system employees, changes in
organizational responsibilities, changes
to the membership structure of the State
WDB or alternative entity, and similar
substantial changes to the State' s
workforce development system.
c) Modifications to the Unified State
Plan are subject to the same public
review and comment requirements in
361. 130( d) that apply to the
development of the original Unified
State Plan.
d) Unified State Plan modifications
must be approved by the Secretaries of
Labor and Education, based on the
approval standards applicable to the
original Unified State Plan under
361. 130. This approval must come
after the approval of the Commissioner
of the Rehabilitation Services
Administration for modification of any
portion of the plan described in sec.
102(b)(2)( D)(iii) of WIOA.
361. 140 What are the general
requirements for submitting a Combined
State Plan?
a) A State may choose to develop and
submit a 4 -year Combined State Plan in
lieu of the Unified State Plan described
in §§361. 105 through 361. 125.
b) A State that submits a Combined
State Plan covering an activity or
program described in paragraph (d) of
this section that is, in accordance with
WIOA sec. 103( c), approved or deemed
complete under the law relating to the
program will not be required to submit
any other plan or application in order to
receive Federal funds to carry out the
core programs or the program or
activities described under paragraph ( d)
of this section that are covered by the
Combined State Plan.
c) If a State develops a Combined
State Plan, it must be submitted in
accordance with the process described
in § 361. 143.
d) If a State chooses to submit a
Combined State Plan, the plan must
include the six core programs and one
or more of the Combined State Plan
partner programs and activities
described in sec. 103( a)( 2) of WIOA. The
Combined State Plan partner programs
and activities that may be included in
the Combined State Plan are:
1) Career and technical education
programs authorized under the Carl D.
Perkins Career and Technical Education
Act of 2006 ( 20 U. S. C. 2301 et seq.);
2) Temporary Assistance for Needy
Families or TANF, authorized under
part A of title IV of the Social Security
Act (42 U.S. C. 601 et seq.);
3) Employment and training
programs authorized under sec. 6( d)( 4)
of the Food and Nutrition Act of 2008
7 U.S. C. 2015( d)(4));
4) Work programs authorized under
sec. 6( o) of the Food and Nutrition Act
of 2008 ( 7 U.S. C. 2015( o));
5) Trade adjustment assistance
activities under chapter 2 of title II of
the Trade Act of 1974 ( 19 U. S. C. 2271
et seq.);
6) Services for veterans authorized
under chapter 41 of title 38 United
States Code;
7) Programs authorized under State
unemployment compensation laws (in
accordance with applicable Federal
law);
8) Senior Community Service
Employment Programs under title V of
the Older Americans Act of 1965 ( 42
U. S. C. 3056 et seq.);
9) Employment and training
activities carried out by the Department
of Housing and Urban Development
HUD);
10) Employment and training
activities carried out under the
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Community Services Block Grant Act
42 U.S. C. 9901 et seq.); and
11) Reintegration of offenders
programs authorized under sec. 212 of
the Second Chance Act of 2007 ( 42
U.S. C. 17532).
e) A Combined State Plan must
contain:
1) For the core programs, the
information required by sec. 102(b) of
WIOA and §§ 361. 105 through 361. 125,
as explained in the joint planning
guidelines issued by the Secretaries;
2) For the Combined State Plan
partner programs and activities, except
as described in paragraph (h) of this
section, the information required by the
law authorizing and governing that
program to be submitted to the
appropriate Secretary, any other
applicable legal requirements, and any
common planning requirements
described in sec. 102(b) of WIOA, as
explained in the joint planning
guidelines issued by the Secretaries;
3) A description of the methods used
for joint planning and coordination
among the core programs, and with the
required one-stop partner programs and
other programs and activities included
in the State Plan; and
4) An assurance that all of the
entities responsible for planning or
administering the programs described in
the Combined State Plan have had a
meaningful opportunity to review and
comment on all portions of the plan.
f)Each Combined State Plan partner
program included in the Combined
State Plan remains subject to the
applicable program -specific
requirements of the Federal law and
regulations, and any other applicable
legal or program requirements,
governing the implementation and
operation of that program.
g) For purposes of §§361. 140 through
361. 145 the term " appropriate
Secretary" means the head of the
Federal agency who exercises either
plan or application approval authority
for the program or activity under the
Federal law authorizing the program or
activity or, if there are no planning or
application requirements, who exercises
administrative authority over the
program or activity under that Federal
law.
h) States that include employment
and training activities carried out under
the Community Services Block Grant
CSBG) Act (42 U.S. C. 9901 et seq.)
under a Combined State Plan would
submit all other required elements of a
complete CSBG State Plan directly to
the Federal agency that administers the
program, according to the requirements
of Federal law and regulations.
i) States that submit employment and
training activities carried out by HUD
under a Combined State Plan would
submit any other required planning
documents for HUD programs directly
to HUD, according to the requirements
of Federal law and regulations.
361. 143 What is the development,
submission, and approval process of the
Combined State Plan?
a) For purposes of § 361. 140( a), if a
State chooses to develop a Combined
State Plan it must submit the Combined
State Plan in accordance with the
requirements described below and sec.
103 of WIOA, as explained in the joint
planning guidelines issued by the
Secretaries of Labor and Education.
b) The Combined State Plan must be
developed with the assistance of the
State WDB, as required by 20 CFR
679. 130( a) and WIOA sec. 101( d), and
must be developed in coordination with
administrators with optimum policy-
making authority for the core programs
and required one-stop partners.
c) The State must provide an
opportunity for public comment on and
input into the development of the
Combined State Plan prior to its
submission.
1) The opportunity for public
comment for the portions of the
Combined State Plan that cover the core
programs must include an opportunity
for comment by representatives of Local
WDBs and chief elected officials,
businesses, representatives of labor
organizations, community-based
organizations, adult education
providers, institutions of higher
education, other stakeholders with an
interest in the services provided by the
six core programs, and the general
public, including individuals with
disabilities.
2) Consistent with the " Sunshine
Provision" of WIOA in sec. 101( g), the
State WDB must make information
regarding the Combined State Plan
available to the public through
electronic means and regularly
occurring open meetings in accordance
with State law. The Combined State
Plan must describe the State' s process
and timeline for ensuring a meaningful
opportunity for public comment on the
portions of the plan covering core
programs.
3) The portions of the plan that cover
the Combined State Plan partner
programs are subject to any public
comment requirements applicable to
those programs.
d) The State must submit to the
Secretaries of Labor and Education and
to the Secretary of the agency with
responsibility for approving the
program' s plan or deeming it complete
under the law governing the program, as
part of its Combined State Plan, any
plan, application, form, or any other
similar document that is required as a
condition for the approval of Federal
funding under the applicable program
or activity. Such submission must occur
in accordance with a process identified
by the relevant Secretaries in paragraph
a) of this section.
e) The Combined State Plan will be
approved or disapproved in accordance
with the requirements of sec. 103( c) of
WIOA.
1) The portion of the Combined State
Plan covering programs administered by
the Departments of Labor and Education
must be reviewed, and approved or
disapproved, by the appropriate
Secretary within 90 days beginning on
the day the Combined State Plan is
received by the appropriate Secretary
from the State, consistent with
paragraph (f) of this section. Before the
Secretaries of Labor and Education
approve the Combined State Plan, the
vocational rehabilitation services
portion of the Combined State Plan
described in WIOA sec. 102( b)( 2)( D)( iii)
must be approved by the Commissioner
of the Rehabilitation Services
Administration.
2) If an appropriate Secretary other
than the Secretary of Labor or the
Secretary of Education has authority to
approve or deem complete a portion of
the Combined State Plan for a program
or activity described in § 361. 140( d),
that portion of the Combined State Plan
must be reviewed, and approved,
disapproved, or deemed complete, by
the appropriate Secretary within 120
days beginning on the day the
Combined State Plan is received by the
appropriate Secretary from the State
consistent with paragraph (f) of this
section.
f) The appropriate Secretaries will
review and approve or deem complete
the Combined State Plan within 90 or
120 days, as appropriate, as described in
paragraph (e) of this section, unless the
Secretaries of Labor and Education or
appropriate Secretary have determined
in writing within that period that:
1) The Combined State Plan is
inconsistent with the requirements of
the six core programs or the Federal
laws authorizing or applicable to the
program or activity involved, including
the criteria for approval of a plan or
application, or deeming the plan
complete, if any, under such law;
2) The portion of the Combined State
Plan describing the six core programs or
the program or activity described in
paragraph (a) of this section involved
does not satisfy the criteria as provided
56026 Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
in sec. 102 or 103 of WIOA, as
applicable; or
3) The Combined State Plan is
incomplete, or otherwise insufficient to
determine whether it is consistent with
a core program' s requirements, other
requirements of WIOA, or the Federal
laws authorizing, or applicable to, the
program or activity described in
361. 140( d), including the criteria for
approval of a plan or application, if any,
under such law.
g) If the Secretary of Labor, the
Secretary of Education, or the
appropriate Secretary does not make the
written determination described in
paragraph (f) of this section within the
relevant period of time after submission
of the Combined State Plan, that portion
of the Combined State Plan over which
the Secretary has jurisdiction will be
considered approved.
h) The Secretaries of Labor and
Education' s written determination of
approval or disapproval regarding the
portion of the plan for the six core
programs may be separate from the
written determination of approval,
disapproval, or completeness of the
program -specific requirements of
Combined State Plan partner programs
and activities described in § 361.140(d)
and included in the Combined State
Plan.
i) Special rule. In paragraphs (f)(1)
and ( 3) of this section, the term " criteria
for approval of a plan or application,"
with respect to a State or a core program
or a program under the Carl D. Perkins
Career and Technical Education Act of
2006 ( 20 U. S. C. 2301 et seq.), includes
a requirement for agreement between
the State and the appropriate Secretaries
regarding State performance measures
or State performance accountability
measures, as the case may be, including
levels of performance.
361. 145 What are the requirements for
modifications of the Combined State Plan?
a) For the core program portions of
the Combined State Plan, modifications
are required, at a minimum:
1) By the end of the first 2 -year
period of any 4 -year State Plan. The
State WDB must review the Combined
State Plan, and the Governor must
submit modifications to the Combined
State Plan to reflect changes in labor
market and economic conditions or
other factors affecting the
implementation of the Combined State
Plan;
2) When changes in Federal or State
law or policy substantially affect the
strategies, goals, and priorities upon
which the Combined State Plan is
based;
3) When there are changes in the
statewide vision, strategies, policies,
State negotiated levels of performance
as described in § 361. 170(b), the
methodology used to determine local
allocation of funds, reorganizations that
change the working relationship with
system employees, changes in
organizational responsibilities, changes
to the membership structure of the State
WDB or alternative entity, and similar
substantial changes to the State' s
workforce development system.
b) In addition to the required
modification review described in
paragraph (a)( 1) of this section, a State
may submit a modification of its
Combined State Plan at any time during
the 4 -year period of the plan.
c) For any Combined State Plan
partner programs and activities
described in § 361. 140( d) that are
included in a State' s Combined State
Plan, the State—
1) May decide if the modification
requirements under WIOA sec. 102( c)( 3)
that apply to the core programs will
apply to the Combined State Plan
partner programs, as long as consistent
with any other modification
requirements for the programs, or may
comply with the requirements
applicable to only the particular
program or activity; and
2) Must submit, in accordance with
the procedure described in § 361. 143,
any modification, amendment, or
revision required by the Federal law
authorizing, or applicable to, the
Combined State Plan partner program or
activity.
i) If the underlying programmatic
requirements change ( e.g., the
authorizing statute is reauthorized) for
Federal laws authorizing such programs,
a State must either modify its Combined
State Plan or submit a separate plan to
the appropriate Federal agency in
accordance with the new Federal law
authorizing the Combined State Plan
partner program or activity and other
legal requirements applicable to such
program or activity.
ii) If the modification, amendment, or
revision affects the administration of
only that particular Combined State
Plan partner program and has no impact
on the Combined State Plan as a whole
or the integration and administration of
the core and other Combined State Plan
partner programs at the State level,
modifications must be submitted for
approval to only the appropriate
Secretary, based on the approval
standards applicable to the original
Combined State Plan under § 361. 143, if
the State elects, or in accordance with
the procedures and requirements
applicable to the particular Combined
State Plan partner program.
3) A State also may amend its
Combined State Plan to add a Combined
State Plan partner program or activity
described in § 361. 140( d).
d) Modifications of the Combined
State Plan are subject to the same public
review and comment requirements that
apply to the development of the original
Combined State Plan as described in
361. 143( c) except that, if the
modification, amendment, or revision
affects the administration of a particular
Combined State Plan partner program
and has no impact on the Combined
State Plan as a whole or the integration
and administration of the core and other
Combined State Plan partner programs
at the State level, a State may comply
instead with the procedures and
requirements applicable to the
particular Combined State Plan partner
program.
e) Modifications for the core program
portions of the Combined State Plan
must be approved by the Secretaries of
Labor and Education, based on the
approval standards applicable to the
original Combined State Plan under
361. 143. This approval must come
after the approval of the Commissioner
of the Rehabilitation Services
Administration for modification of any
portion of the Combined State Plan
described in sec. 102(b)( 2)( D)(iii) of
WIOA.
6. Revise subpart E of part 361 to read
as follows:
Subpart E— Performance Accountability
Under Title I of the Workforce Innovation
and Opportunity Act
Sec.
361. 150 What definitions apply to
Workforce Innovation and Opportunity
Act performance accountability
provisions?
361. 155 What are the primary indicators of
performance under the Workforce
Innovation and Opportunity Act?
361. 160 What information is required for
State performance reports?
361. 165 May a State establish additional
indicators of performance?
361. 170 How are State levels of
performance for primary indicators
established?
361. 175 What responsibility do States have
to use quarterly wage record information
for performance accountability?
361. 180 When is a State subject to a
financial sanction under the Workforce
Innovation and Opportunity Act?
361. 185 When are sanctions applied for a
State' s failure to submit an annual
performance report?
361. 190 When are sanctions applied for
failure to achieve adjusted levels of
performance?
56027Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
361. 195 What should States expect when a
sanction is applied to the Governor' s
Reserve Allotment?
361. 200 What other administrative actions
will be applied to States' performance
requirements?
361. 205 What performance indicators apply
to local areas and what information must
be included in local area performance
reports?
361. 210 How are local performance levels
established?
361. 215 Under what circumstances are
local areas eligible for State Incentive
Grants?
361. 220 Under what circumstances may a
corrective action or sanction be applied
to local areas for poor performance?
361. 225 Under what circumstances may
local areas appeal a reorganization plan?
361. 230 What information is required for
the eligible training provider
performance reports?
361. 235 What are the reporting
requirements for individual records for
core Workforce Innovation and
Opportunity Act (WIOA) title I programs;
the Wagner-Peyser Act Employment
Service program, as amended by WIOA
title III; and the Vocational
Rehabilitation program authorized under
title I of the Rehabilitation Act of 1973,
as amended by WIOA title IV?
361. 240 What are the requirements for data
validation of State annual performance
reports?
Authority: Secs. 116, 189, and 503 of Pub.
L. 113-128, 128 Stat. 1425 (Jul. 22, 2014).
Subpart E— Performance
Accountability Under Title I of the
Workforce Innovation and Opportunity
Act
361. 150 What definitions apply to
Workforce Innovation and Opportunity Act
performance accountability provisions?
a) Participant. A reportable
individual who has received services
other than the services described in
paragraph (a)( 3) of this section, after
satisfying all applicable programmatic
requirements for the provision of
services, such as eligibility
determination.
1) For the Vocational Rehabilitation
VR) program, a participant is a
reportable individual who has an
approved and signed Individualized
Plan for Employment (IPE) and has
begun to receive services.
2) For the Workforce Innovation and
Opportunity Act (WIOA) title I youth
program, a participant is a reportable
individual who has satisfied all
applicable program requirements for the
provision of services, including
eligibility determination, an objective
assessment, and development of an
individual service strategy, and received
1 of the 14 WIOA youth program
elements identified in sec. 129( c)( 2) of
WIOA.
3) The following individuals are not
participants:
i) Individuals in an Adult Education
and Family Literacy Act (AEFLA)
program who have not completed at
least 12 contact hours;
ii) Individuals who only use the self-
service system.
A) Subject to paragraph ( a)( 3)( ii)(B) of
this section, self-service occurs when
individuals independently access any
workforce development system
program' s information and activities in
either a physical location, such as a one-
stop center resource room or partner
agency, or remotely via the use of
electronic technologies.
B) Self-service does not uniformly
apply to all virtually accessed services.
For example, virtually accessed services
that provide a level of support beyond
independent job or information seeking
on the part of an individual would not
qualify as self-service.
iii) Individuals who receive
information -only services or activities,
which provide readily available
information that does not require an
assessment by a staff member of the
individual' s skills, education, or career
objectives.
4) Programs must include
participants in their performance
calculations.
b) Reportable individual. An
individual who has taken action that
demonstrates an intent to use program
services and who meets specific
reporting criteria of the program,
including:
1) Individuals who provide
identifying information;
2) Individuals who only use the self-
service system; or
3) Individuals who only receive
information -only services or activities.
c) Exit. As defined for the purpose of
performance calculations, exit is the
point after which a participant who has
received services through any program
meets the following criteria:
1) For the adult, dislocated worker,
and youth programs authorized under
WIOA title I, the AEFLA program
authorized under WIOA title II, and the
Employment Service program
authorized under the Wagner-Peyser
Act, as amended by WIOA title III, exit
date is the last date of service.
i) The last day of service cannot be
determined until at least 90 days have
elapsed since the participant last
received services; services do not
include self-service, information -only
services or activities, or follow-up
services. This also requires that there
are no plans to provide the participant
with future services.
ii) [Reserved].
2)( i) For the VR program authorized
under title I of the Rehabilitation Act of
1973, as amended by WIOA title IV (VR
program):
A) The participant' s record of service
is closed in accordance with § 361. 56
because the participant has achieved an
employment outcome; or
B) The participant' s service record is
closed because the individual has not
achieved an employment outcome or
the individual has been determined
ineligible after receiving services in
accordance with § 361. 43.
ii) Notwithstanding any other
provision of this section, a participant
will not be considered as meeting the
definition of exit from the VR program
if the participant' s service record is
closed because the participant has
achieved a supported employment
outcome in an integrated setting but not
in competitive integrated employment.
3)( i) A State may implement a
common exit policy for all or some of
the core programs in WIOA title I and
the Employment Service program
authorized under the Wagner-Peyser
Act, as amended by WIOA title III, and
any additional required partner
program(s) listed in sec. 121( b)( 1)( B) of
WIOA that is under the authority of the
U.S. Department of Labor (DOL).
ii) If a State chooses to implement a
common exit policy, the policy must
require that a participant is exited only
when all of the criteria in paragraph
c)( 1) of this section are met for the
WIOA title I core programs and the
Employment Service program
authorized under the Wagner-Peyser
Act, as amended by WIOA title III, as
well as any additional required partner
programs listed in sec. 121( b)( 1)( B) of
WIOA under the authority of DOL to
which the common exit policy applies
in which the participant is enrolled.
d) State. For purposes of this part,
other than in regard to sanctions or the
statistical adjustment model, all
references to " State" include the
outlying areas of American Samoa,
Guam, Commonwealth of the Northern
Mariana Islands, the U.S. Virgin Islands,
and, as applicable, the Republic of
Palau.
361. 155 What are the primary indicators
of performance under the Workforce
Innovation and Opportunity Act?
a) All States submitting either a
Unified or Combined State Plan under
361. 130 and 361. 143, must propose
expected levels of performance for each
of the primary indicators of performance
for the adult, dislocated worker, and
youth programs authorized under WIOA
title I; the AEFLA program authorized
under WIOA title II; the Employment
56028 Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
Service program authorized under the
Wagner-Peyser Act, as amended by
WIOA title III; and the VR program
authorized under title I of the
Rehabilitation Act of 1973, as amended
by WIOA title IV.
1) Primary indicators ofperformance.
The six primary indicators of
performance for the adult and
dislocated worker programs, the AEFLA
program, and the VR program are:
i) The percentage of participants who
are in unsubsidized employment during
the second quarter after exit from the
program;
ii) The percentage of participants
who are in unsubsidized employment
during the fourth quarter after exit from
the program;
iii) Median earnings of participants
who are in unsubsidized employment
during the second quarter after exit from
the program;
iv)(A) The percentage of those
participants enrolled in an education or
training program (excluding those in on-
the-job training [OJT] and customized
training) who attained a recognized
postsecondary credential or a secondary
school diploma, or its recognized
equivalent, during participation in or
within 1 year after exit from the
program.
B) A participant who has attained a
secondary school diploma or its
recognized equivalent is included in the
percentage of participants who have
attained a secondary school diploma or
recognized equivalent only if the
participant also is employed or is
enrolled in an education or training
program leading to a recognized
postsecondary credential within 1 year
after exit from the program;
v) The percentage of participants
who, during a program year, are in an
education or training program that leads
to a recognized postsecondary
credential or employment and who are
achieving measurable skill gains,
defined as documented academic,
technical, occupational, or other forms
of progress, towards such a credential or
employment. Depending upon the type
of education or training program,
documented progress is defined as one
of the following:
A) Documented achievement of at
least one educational functioning level
of a participant who is receiving
instruction below the postsecondary
education level;
B) Documented attainment of a
secondary school diploma or its
recognized equivalent;
C) Secondary or postsecondary
transcript or report card for a sufficient
number of credit hours that shows a
participant is meeting the State unit's
academic standards;
D) Satisfactory or better progress
report, towards established milestones,
such as completion of OJT or
completion of 1 year of an
apprenticeship program or similar
milestones, from an employer or
training provider who is providing
training; or
E) Successful passage of an exam that
is required for a particular occupation or
progress in attaining technical or
occupational skills as evidenced by
trade -related benchmarks such as
knowledge-based exams.
vi) Effectiveness in serving
employers.
2) Participants. For purposes of the
primary indicators of performance in
paragraph (a)( 1) of this section,
participant" will have the meaning
given to it in § 361. 150( a), except that—
i) For purposes of determining
program performance levels under
indicators set forth in paragraphs
a)( 1)( i) through (iv) and (vi) of this
section, a " participant" does not
include a participant who received
services under sec. 225 of WIOA and
exits such program while still in a
correctional institution as defined in
sec. 225( e)( 1) of WIOA; and
ii) The Secretaries of Labor and
Education may, as needed and
consistent with the Paperwork
Reduction Act (PRA), make further
determinations as to the participants to
be included in calculating program
performance levels for purposes of any
of the performance indicators set forth
in paragraph (a)(1) of this section.
b) The primary indicators in
paragraphs (a)( 1)( i) through (iii) and (vi)
of this section apply to the Employment
Service program authorized under the
Wagner-Peyser Act, as amended by
WIOA title III.
c) For the youth program authorized
under WIOA title I, the primary
indicators are:
1) Percentage of participants who are
in education or training activities, or in
unsubsidized employment, during the
second quarter after exit from the
program;
2) Percentage of participants in
education or training activities, or in
unsubsidized employment, during the
fourth quarter after exit from the
program;
3) Median earnings of participants
who are in unsubsidized employment
during the second quarter after exit from
the program;
4) The percentage of those
participants enrolled in an education or
training program (excluding those in
OJT and customized training) who
obtained a recognized postsecondary
credential or a secondary school
diploma, or its recognized equivalent,
during participation in or within 1 year
after exit from the program, except that
a participant who has attained a
secondary school diploma or its
recognized equivalent is included as
having attained a secondary school
diploma or recognized equivalent only
if the participant is also employed or is
enrolled in an education or training
program leading to a recognized
postsecondary credential within 1 year
from program exit;
5) The percentage of participants
who during a program year, are in an
education or training program that leads
to a recognized postsecondary
credential or employment and who are
achieving measurable skill gains,
defined as documented academic,
technical, occupational or other forms of
progress towards such a credential or
employment. Depending upon the type
of education or training program,
documented progress is defined as one
of the following:
i) Documented achievement of at
least one educational functioning level
of a participant who is receiving
instruction below the postsecondary
education level;
ii) Documented attainment of a
secondary school diploma or its
recognized equivalent;
iii) Secondary or postsecondary
transcript or report card for a sufficient
number of credit hours that shows a
participant is achieving the State unit' s
academic standards;
iv) Satisfactory or better progress
report, towards established milestones,
such as completion of OJT or
completion of 1 year of an
apprenticeship program or similar
milestones, from an employer or
training provider who is providing
training; or
v) Successful passage of an exam that
is required for a particular occupation or
progress in attaining technical or
occupational skills as evidenced by
trade -related benchmarks such as
knowledge-based exams.
6) Effectiveness in serving employers.
361. 160 What information is required for
State performance reports?
a) The State performance report
required by sec. 116( d)( 2) of WIOA must
be submitted annually using a template
the Departments of Labor and Education
will disseminate, and must provide, at
a minimum, information on the actual
performance levels achieved consistent
with § 361. 175 with respect to:
1) The total number of participants
served, and the total number of
56029Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
participants who exited each of the core
programs identified in sec.
116(b)( 3)( A)(ii) of WIOA, including
disaggregated counts of those who
participated in and exited a core
program, by:
i) Individuals with barriers to
employment as defined in WIOA sec.
3( 24); and
ii) Co -enrollment in any of the
programs in WIOA sec. 116( b)( 3)( A)(ii).
2) Information on the performance
levels achieved for the primary
indicators of performance for all of the
core programs identified in § 361. 155
including disaggregated levels for:
i) Individuals with barriers to
employment as defined in WIOA sec.
3( 24);
ii) Age;
iii) Sex; and
iv) Race and ethnicity.
3) The total number of participants
who received career services and the
total number of participants who exited
from career services for the most recent
program year and the 3 preceding
program years, and the total number of
participants who received training
services and the total number of
participants who exited from training
services for the most recent program
year and the 3 preceding program years,
as applicable to the program;
4) Information on the performance
levels achieved for the primary
indicators of performance consistent
with § 361. 155 for career services and
training services for the most recent
program year and the 3 preceding
program years, as applicable to the
program;
5) The percentage of participants in
a program who attained unsubsidized
employment related to the training
received (often referred to as training -
related employment) through WIOA
title I, subtitle B programs;
6) The amount of funds spent on
career services and the amount of funds
spent on training services for the most
recent program year and the 3 preceding
program years, as applicable to the
program;
7) The average cost per participant
for those participants who received
career services and training services,
respectively, during the most recent
program year and the 3 preceding
program years, as applicable to the
program;
8) The percentage of a State' s annual
allotment under WIOA sec. 132(b) that
the State spent on administrative costs;
and
9) Information that facilitates
comparisons of programs with programs
in other States.
10) For WIOA title I programs, a State
performance narrative, which, for States
in which a local area is implementing a
pay -for -performance contracting
strategy, at a minimum provides:
i) A description of pay -for -
performance contract strategies being
used for programs;
ii) The performance of service
providers entering into contracts for
such strategies, measured against the
levels of performance specified in the
contracts for such strategies; and
iii) An evaluation of the design of the
programs and performance strategies
and, when available, the satisfaction of
employers and participants who
received services under such strategies.
b) The disaggregation of data for the
State performance report must be done
in compliance with WIOA sec.
116( d)( 6)( C).
c) The State performance reports
must include a mechanism of electronic
access to the State' s local area and
eligible training provider (ETP)
performance reports.
d) States must comply with these
requirements from sec. 116 of WIOA as
explained in joint guidance issued by
the Departments of Labor and
Education, which may include
information on reportable individuals as
determined by the Secretaries of Labor
and Education.
361. 165 May a State establish additional
indicators of performance?
States may identify additional
indicators of performance for the six
core programs. If a State does so, these
indicators must be included in the
Unified or Combined State Plan.
361. 170 How are State levels of
performance for primary indicators
established?
a) A State must submit in the State
Plan expected levels of performance on
the primary indicators of performance
for each core program as required by
sec. 116(b)(3)(A)(iii) of WIOA as
explained in joint guidance issued by
the Secretaries of Labor and Education.
1) The initial State Plan submitted
under WIOA must contain expected
levels of performance for the first 2
years of the State Plan.
2) States must submit expected levels
of performance for the third and fourth
year of the State Plan before the third
program year consistent with §§361. 135
and 361. 145.
b) States must reach agreement on
levels of performance with the
Secretaries of Labor and Education for
each indicator for each core program.
These are the negotiated levels of
performance. The negotiated levels must
be based on the following factors:
1) How the negotiated levels of
performance compare with State levels
of performance established for other
States;
2) The application of an objective
statistical model established by the
Secretaries of Labor and Education,
subject to paragraph (d) of this section;
3) How the negotiated levels promote
continuous improvement in
performance based on the primary
indicators and ensure optimal return on
investment of Federal funds; and
4) The extent to which the negotiated
levels assist the State in meeting the
performance goals established by the
Secretaries of Labor and Education for
the core programs in accordance with
the Government Performance and
Results Act of 1993, as amended.
c) An objective statistical adjustment
model will be developed and
disseminated by the Secretaries of Labor
and Education. The model will be based
on:
1) Differences among States in actual
economic conditions, including but not
limited to unemployment rates and job
losses or gains in particular industries;
and
2) The characteristics of participants,
including but not limited to:
i) Indicators of poor work history;
ii) Lack of work experience;
iii) Lack of educational or
occupational skills attainment;
iv) Dislocation from high -wage and
high -benefit employment;
v) Low levels of literacy;
vi) Low levels of English proficiency;
vii) Disability status;
viii) Homelessness;
ix) Ex -offender status; and
x) Welfare dependency.
d) The objective statistical
adjustment model developed under
paragraph (c) of this section will be:
1) Applied to the core programs'
primary indicators upon availability of
data which are necessary to populate
the model and apply the model to the
local core programs;
2) Subject to paragraph (d)( 1) of this
section, used before the beginning of a
program year in order to reach
agreement on State negotiated levels for
the upcoming program year; and
3) Subject to paragraph (d)( 1) of this
section, used to revise negotiated levels
at the end of a program year based on
actual economic conditions and
characteristics of participants served,
consistent with sec. 116( b)( 3)( A)(vii) of
WIOA.
e) The negotiated levels revised at the
end of the program year, based on the
statistical adjustment model, are the
adjusted levels of performance.
f) States must comply with these
requirements from sec. 116 of WIOA as
56030 Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
explained in joint guidance issued by
the Departments of Labor and
Education.
361. 175 What responsibility do States
have to use quarterly wage record
information for performance
accountability?
a)( 1) States must, consistent with
State laws, use quarterly wage record
information in measuring a State' s
performance on the primary indicators
of performance outlined in § 361. 155
and a local area' s performance on the
primary indicators of performance
identified in § 361. 205.
2) The use of social security numbers
from participants and such other
information as is necessary to measure
the progress of those participants
through quarterly wage record
information is authorized.
3) To the extent that quarterly wage
records are not available for a
participant, States may use other
information as is necessary to measure
the progress of those participants
through methods other than quarterly
wage record information.
b) " Quarterly wage record
information" means intrastate and
interstate wages paid to an individual,
the social security number (or numbers,
if more than one) of the individual, and
the name, address, State, and the
Federal employer identification number
of the employer paying the wages to the
individual.
c) The Governor may designate a
State agency ( or appropriate State
entity) to assist in carrying out the
performance reporting requirements for
WIOA core programs and ETPs. The
Governor or such agency (or appropriate
State entity) is responsible for:
1) Facilitating data matches;
2) Data quality reliability; and
3) Protection against disaggregation
that would violate applicable privacy
standards.
361. 180 When is a State subject to a
financial sanction under the Workforce
Innovation and Opportunity Act?
A State will be subject to financial
sanction under WIOA sec. 116( f) if it
fails to:
a) Submit the State annual
performance report required under
WIOA sec. 116(d)(2); or
b) Meet adjusted levels of
performance for the primary indicators
of performance in accordance with sec.
116( f) of WIOA.
361. 185 When are sanctions applied for
a State' s failure to submit an annual
performance report?
a) Sanctions will be applied when a
State fails to submit the State annual
performance report required under sec.
116( d)( 2) of WIOA. A State fails to
report if the State either:
1) Does not submit a State annual
performance report by the date for
timely submission set in performance
reporting guidance; or
2) Submits a State annual
performance report by the date for
timely submission, but the report is
incomplete.
b) Sanctions will not be applied if the
reporting failure is due to exceptional
circumstances outside of the State' s
control. Exceptional circumstances may
include, but are not limited to:
1) Natural disasters;
2) Unexpected personnel transitions;
and
3) Unexpected technology related
issues.
c) In the event that a State may not
be able to submit a complete and
accurate performance report by the
deadline for timely reporting:
1) The State must notify the Secretary
of Labor or Secretary of Education as
soon as possible, but no later than 30
days prior to the established deadline
for submission, of a potential impact on
the State' s ability to submit its State
annual performance report in order to
not be considered failing to report.
2) In circumstances where
unexpected events occur less than 30
days before the established deadline for
submission of the State annual
performance reports, the Secretaries of
Labor and Education will review
requests for extending the reporting
deadline in accordance with the
Departments of Labor and Education' s
procedures that will be established in
guidance.
361. 190 When are sanctions applied for
failure to achieve adjusted levels of
performance?
a) States' negotiated levels of
performance will be adjusted through
the application of the statistical
adjustment model established under
361. 170 to account for actual
economic conditions experienced
during a program year and
characteristics of participants, annually
at the close of each program year.
b) Any State that fails to meet
adjusted levels of performance for the
primary indicators of performance
outlined in § 361. 155 for any year will
receive technical assistance, including
assistance in the development of a
performance improvement plan
provided by the Secretary of Labor or
Secretary of Education.
c) Whether a State has failed to meet
adjusted levels of performance will be
determined using the following three
criteria:
1) The overall State program score,
which is expressed as the percent
achieved, compares the actual results
achieved by a core program on the
primary indicators of performance to the
adjusted levels of performance for that
core program. The average of the
percentages achieved of the adjusted
level of performance for each of the
primary indicators by a core program
will constitute the overall State program
score.
2) However, until all indicators for
the core program have at least 2 years
of complete data, the overall State
program score will be based on a
comparison of the actual results
achieved to the adjusted level of
performance for each of the primary
indicators that have at least 2 years of
complete data for that program;
3) The overall State indicator score,
which is expressed as the percent
achieved, compares the actual results
achieved on a primary indicator of
performance by all core programs in a
State to the adjusted levels of
performance for that primary indicator.
The average of the percentages achieved
of the adjusted level of performance by
all of the core programs on that
indicator will constitute the overall
State indicator score.
4) However, until all indicators for
the State have at least 2 years of
complete data, the overall State
indicator score will be based on a
comparison of the actual results
achieved to the adjusted level of
performance for each of the primary
indicators that have at least 2 years of
complete data in a State.
5) The individual indicator score,
which is expressed as the percent
achieved, compares the actual results
achieved by each core program on each
of the individual primary indicators to
the adjusted levels of performance for
each of the program' s primary indicators
of performance.
d) A performance failure occurs
when:
1) Any overall State program score or
overall State indicator score falls below
90 percent for the program year; or
2) Any of the States' individual
indicator scores fall below 50 percent
for the program year.
e) Sanctions based on performance
failure will be applied to States if,for 2
consecutive years, the State fails to
meet:
1) 90 percent of the overall State
program score for the same core
program;
2) 90 percent of the overall State
indicator score for the same primary
indicator; or
56031Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
3) 50 percent of the same indicator
score for the same program.
361. 195 What should States expect when
a sanction is applied to the Governor' s
Reserve Allotment?
a) The Secretaries of Labor and
Education will reduce the Governor' s
Reserve Allotment by five percent of the
maximum available amount for the
immediately succeeding program year
if:
1) The State fails to submit the State
annual performance reports as required
under WIOA sec. 116( d)( 2), as defined
in § 361. 185;
2) The State fails to meet State
adjusted levels of performance for the
same primary performance indicator(s)
under either § 361. 190( d)( 1) for the
second consecutive year as defined in
361. 190; or
3) The State' s score on the same
indicator for the same program falls
below 50 percent under § 361. 190( d)( 2)
for the second consecutive year as
defined in § 361. 190.
b) If the State fails under paragraphs
a)( 1) and either (a)( 2) or (3) of this
section in the same program year, the
Secretaries of Labor and Education will
reduce the Governor' s Reserve
Allotment by 10 percent of the
maximum available amount for the
immediately succeeding program year.
c) If a State' s Governor' s Reserve
Allotment is reduced:
1) The reduced amount will not be
returned to the State in the event that
the State later improves performance or
submits its annual performance report;
and
2) The Governor' s Reserve will
continue to be set at the reduced level
in each subsequent year until the
Secretary of Labor or the Secretary of
Education, depending on which
program is impacted, determines that
the State met the State adjusted levels
of performance for the applicable
primary performance indicators and has
submitted all of the required
performance reports.
d) A State may request review of a
sanction the Secretary of Labor imposes
in accordance with the provisions of 20
CFR 683. 800.
361. 200 What other administrative
actions will be applied to States'
performance requirements?
a) In addition to sanctions for failure
to report or failure to meet adjusted
levels of performance, States will be
subject to administrative actions in the
case of poor performance.
b) States' performance achievement
on the individual primary indicators
will be assessed in addition to the
overall State program score and overall
State indicator score. Based on this
assessment, as clarified and explained
in guidance, for performance on any
individual primary indicator, the
Secretary of Labor or the Secretary of
Education will require the State to
establish a performance risk plan to
address continuous improvement on the
individual primary indicator.
361. 205 What performance indicators
apply to local areas and what information
must be included in local area performance
reports?
a) Each local area in a State under
WIOA title I is subject to the same
primary indicators of performance for
the core programs for WIOA title I under
361. 155( a)( 1) and ( c) that apply to the
State.
b) In addition to the indicators
described in paragraph (a) of this
section, under § 361. 165, the Governor
may apply additional indicators of
performance to local areas in the State.
c) States must annually make local
area performance reports available to
the public using a template that the
Departments of Labor and Education
will disseminate in guidance, including
by electronic means. The State must
provide electronic access to the public
local area performance report in its
annual State performance report.
d) The local area performance report
must include:
1) The actual results achieved under
361. 155 and the information required
under § 361. 160( a);
2) The percentage of a local area' s
allotment under WIOA secs. 128( b) and
133(b) that the local area spent on
administrative costs; and
3) Other information that facilitates
comparisons of programs with programs
in other local areas ( or planning regions
if the local area is part of a planning
region).
e) The disaggregation of data for the
local area performance report must be
done in compliance with WIOA sec.
116( d)( 6)( C).
f) States must comply with any
requirements from sec. 116( d)( 3) of
WIOA as explained in guidance,
including the use of the performance
reporting template, issued by DOL.
361. 210 How are local performance
levels established?
a) The objective statistical adjustment
model required under sec.
116(b)( 3)( A)(viii) of WIOA and
described in § 361. 170( c) must be:
1) Applied to the core programs'
primary indicators upon availability of
data which are necessary to populate
the model and apply the model to the
local core programs;
2) Used in order to reach agreement
on local negotiated levels of
performance for the upcoming program
year; and
3) Used to establish adjusted levels of
performance at the end of a program
year based on actual conditions,
consistent with WIOA sec. 116( c)( 3).
b) Until all indicators for the core
program in a local area have at least 2
years of complete data, the comparison
of the actual results achieved to the
adjusted levels of performance for each
of the primary indicators only will be
applied where there are at least 2 years
of complete data for that program.
c) The Governor, Local Workforce
Development Board (WDB), and chief
elected official must reach agreement on
local negotiated levels of performance
based on a negotiations process before
the start of a program year with the use
of the objective statistical model
described in paragraph (a) of this
section. The negotiations will include a
discussion of circumstances not
accounted for in the model and will take
into account the extent to which the
levels promote continuous
improvement. The objective statistical
model will be applied at the end of the
program year based on actual economic
conditions and characteristics of the
participants served.
d) The negotiations process described
in paragraph (c) of this section must be
developed by the Governor and
disseminated to all Local WDBs and
chief elected officials.
e) The Local WDBs may apply
performance measures to service
providers that differ from the
performance indicators that apply to the
local area. These performance measures
must be established after considering:
1) The established local negotiated
levels;
2) The services provided by each
provider; and
3) The populations the service
providers are intended to serve.
361. 215 Under what circumstances are
local areas eligible for State Incentive
Grants?
a) The Governor is not required to
award local incentive funds, but is
authorized to provide incentive grants
to local areas for performance on the
primary indicators of performance
consistent with WIOA sec.
134( a)( 3)( A)(xi).
b) The Governor may use non -
Federal funds to create incentives for
the Local WDBs to implement pay -for -
performance contract strategies for the
delivery of training services described
in WIOA sec. 134( c)( 3) or activities
described in WIOA sec. 129( c)( 2) in the
56032 Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
local areas served by the Local WDBs.
Pay -for -performance contract strategies
must be implemented in accordance
with 20 CFR part 683, subpart E and
361. 160.
361. 220 Under what circumstances may
a corrective action or sanction be applied
to local areas for poor performance?
a) If a local area fails to meet the
adjusted levels of performance agreed to
under § 361. 210 for the primary
indicators of performance in the adult,
dislocated worker, and youth programs
authorized under WIOA title I in any
program year, technical assistance must
be provided by the Governor or, upon
the Governor' s request, by the Secretary
of Labor.
1) A State must establish the
threshold for failure to meet adjusted
levels of performance for a local area
before coming to agreement on the
negotiated levels of performance for the
local area.
i) A State must establish the adjusted
level of performance for a local area,
using the statistical adjustment model
described in § 361. 170( c).
ii) At least 2 years of complete data
on any indicator for any local core
program are required in order to
establish adjusted levels of performance
for a local area.
2) The technical assistance may
include:
i) Assistance in the development of a
performance improvement plan;
ii) The development of a modified
local or regional plan; or
iii) Other actions designed to assist
the local area in improving
performance.
b) If a local area fails to meet the
adjusted levels of performance agreed to
under § 361. 210 for the same primary
indicators of performance for the same
core program authorized under WIOA
title I for a third consecutive program
year, the Governor must take corrective
actions. The corrective actions must
include the development of a
reorganization plan under which the
Governor:
1) Requires the appointment and
certification of a new Local WDB,
consistent with the criteria established
under 20 CFR 679. 350;
2) Prohibits the use of eligible
providers and one-stop partners that
have been identified as achieving poor
levels of performance; or
3) Takes such other significant
actions as the Governor determines are
appropriate.
361. 225 Under what circumstances may
local areas appeal a reorganization plan?
a) The Local WDB and chief elected
official for a local area that is subject to
a reorganization plan under WIOA sec.
116( g)( 2)( A) may appeal to the Governor
to rescind or revise the reorganization
plan not later than 30 days after
receiving notice of the reorganization
plan. The Governor must make a final
decision within 30 days after receipt of
the appeal.
b) The Local WDB and chief elected
official may appeal the final decision of
the Governor to the Secretary of Labor
not later than 30 days after receiving the
decision from the Governor. Any appeal
of the Governor' s final decision must be:
1) Appealed jointly by the Local
WDB and chief elected official to the
Secretary of Labor under 20 CFR
683. 650; and
2) Must be submitted by certified
mail, return receipt requested, to the
Secretary of Labor, U.S. Department of
Labor, 200 Constitution Ave. NW.,
Washington, DC 20210, Attention:
ASET. A copy of the appeal must be
simultaneously provided to the
Governor.
c) Upon receipt of the joint appeal
from the Local WDB and chief elected
official, the Secretary of Labor must
make a final decision within 30 days. In
making this determination the Secretary
of Labor may consider any comments
submitted by the Governor in response
to the appeals.
d) The decision by the Governor on
the appeal becomes effective at the time
it is issued and remains effective unless
the Secretary of Labor rescinds or
revises the reorganization plan under
WIOA sec. 116( g)( 2)( C).
361. 230 What information is required for
the eligible training provider performance
reports?
a) States are required to make
available and publish annually using a
template the Departments of Labor and
Education will disseminate including
through electronic means, the ETP
performance reports for ETPs who
provide services under sec. 122 of
WIOA that are described in 20 CFR
680.400 through 680.530. These reports
at a minimum must include, consistent
with § 361. 175 and with respect to each
program of study that is eligible to
receive funds under WIOA:
1) The total number of participants as
defined by § 361. 150( a) who received
training services under the adult and
dislocated worker programs authorized
under WIOA title I for the most recent
year and the 3 preceding program years,
including:
i) The number of participants under
the adult and dislocated worker
programs disaggregated by barriers to
employment;
ii) The number of participants under
the adult and dislocated worker
programs disaggregated by race,
ethnicity, sex, and age;
iii) The number of participants under
the adult and dislocated worker
programs disaggregated by the type of
training entity for the most recent
program year and the 3 preceding
program years;
2) The total number of participants
who exit a program of study or its
equivalent, including disaggregate
counts by the type of training entity
during the most recent program year
and the 3 preceding program years;
3) The average cost -per -participant
for participants who received training
services for the most recent program
year and the 3 preceding program years
disaggregated by type of training entity;
4) The total number of individuals
exiting from the program of study (or
the equivalent) with respect to all
individuals engaging in the program of
study (or the equivalent); and
5) The levels of performance
achieved for the primary indicators of
performance identified in
361. 155( a)( 1)( i) through (iv) with
respect to all individuals engaging in a
program of study (or the equivalent).
b) Apprenticeship programs
registered under the National
Apprenticeship Act are not required to
submit ETP performance information. If
a registered apprenticeship program
voluntarily submits performance
information to a State, the State must
include this information in the report.
c) The State must provide a
mechanism of electronic access to the
public ETP performance report in its
annual State performance report.
d) States must comply with any
requirements from sec. 116(d)(4) of
WIOA as explained in guidance issued
by DOL.
e) The Governor may designate one
or more State agencies such as a State
Education Agency or other State
Educational Authority to assist in
overseeing ETP performance and
facilitating the production and
dissemination of ETP performance
reports. These agencies may be the same
agencies that are designated as
responsible for administering the ETP
list as provided under 20 CFR 680. 500.
The Governor or such agencies, or
authorities, is responsible for:
1) Facilitating data matches between
ETP records and unemployment
insurance ( UI) wage data in order to
produce the report;
2) The creation and dissemination of
the reports as described in paragraphs
a) through (d) of this section;
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361. 705 What guidance must the Governor3) Coordinating the dissemination of 116( d)( 5) of WIOA as explained in
the performance reports with the ETP guidance. issue regarding one-stop infrastructure
list and the information required to funding?7. Add subpart F to part 361 to read 361. 710 How are infrastructure costs accompany the list, as provided in 20 as follows: funded?
CFR 680. 500.
361. 235 What are the reporting
requirements for individual records for core
Workforce Innovation and Opportunity Act
WIOA) title I programs; the Wagner-Peyser
Act Employment Service program, as
amended by WIOA title III; and the
Vocational Rehabilitation program
authorized under title I of the Rehabilitation
Act of 1973, as amended by WIOA title IV?
a) On a quarterly basis, each State
must submit to the Secretary of Labor or
the Secretary of Education, as
appropriate, individual records that
include demographic information,
information on services received, and
information on resulting outcomes, as
appropriate, for each reportable
individual in either of the following
programs administered by the Secretary
of Labor or Secretary of Education: A
WIOA title I core program; the
Employment Service program
authorized under the Wagner-Peyser
Act, as amended by WIOA title III; or
the VR program authorized under title I
of the Rehabilitation Act of 1973, as
amended by WIOA title IV.
b) For individual records submitted
to the Secretary of Labor, those records
may be required to be integrated across
all programs administered by the
Secretary of Labor in one single file.
c) States must comply with the
requirements of sec. 116(d)( 2) of WIOA
as explained in guidance issued by the
Departments of Labor and Education.
361. 240 What are the requirements for
data validation of State annual performance
reports?
a) States must establish procedures,
consistent with guidelines issued by the
Secretary of Labor or the Secretary of
Education, to ensure that they submit
complete annual performance reports
that contain information that is valid
and reliable, as required by WIOA sec.
116( d)( 5).
b) If a State fails to meet standards in
paragraph (a) of this section as
determined by the Secretary of Labor or
the Secretary of Education, the
appropriate Secretary will provide
technical assistance and may require the
State to develop and implement
corrective actions, which may require
the State to provide training for its
subrecipients.
c) The Secretaries of Labor and
Education will provide training and
technical assistance to States in order to
implement this section. States must
comply with the requirements of sec.
Subpart F -Description of the One -Stop
Delivery System Under Title I of the
Workforce Innovation and Opportunity Act
Sec.
361. 300 What is the one-stop delivery
system?
361. 305 What is a comprehensive one-stop
center and what must be provided there?
361. 310 What is an affiliated site and what
must be provided there?
361. 315 Can a stand-alone Wagner-Peyser
Act Employment Service office be
designated as an affiliated one-stop site?
361. 320 Are there any requirements for
networks of eligible one-stop partners or
specialized centers?
361.400 Who are the required one-stop
partners?
361. 405 Is Temporary Assistance for Needy
Families a required one-stop partner?
361. 410 What other entities may serve as
one-stop partners?
361. 415 What entity serves as the one-stop
partner for a particular program in the
local area?
361. 420 What are the roles and
responsibilities of the required one-stop
partners?
361. 425 What are the applicable career
services that must be provided through
the one-stop delivery system by required
one-stop partners?
361. 430 What are career services?
361. 435 What are the business services
provided through the one-stop delivery
system, and how are they provided?
361. 440 When may a fee be charged for the
business services in this subpart?
361. 500 What is the Memorandum of
Understanding for the one-stop delivery
system and what must be included in the
Memorandum of Understanding?
361. 505 Is there a single Memorandum of
Understanding for the local area, or must
there be different Memoranda of
Understanding between the Local
Workforce Development Board and each
partner?
361. 510 How must the Memorandum of
Understanding be negotiated?
361. 600 Who may operate one-stop centers?
361. 605 How is the one-stop operator
selected?
361. 610 When is the sole -source selection
of one-stop operators appropriate, and
how is it conducted?
361. 615 May an entity currently serving as
one-stop operator compete to be a one-
stop operator under the procurement
requirements of this subpart?
361. 620 What is the one-stop operator' s
role?
361. 625 Can a one-stop operator also be a
service provider?
361. 630 Can State merit staff still work in
a one-stop center where the operator is
not a governmental entity?
361. 635 What is the compliance date of the
provisions of this subpart?
361. 700 What are the one-stop
infrastructure costs?
361. 715 How are one-stop infrastructure
costs funded in the local funding
mechanism?
361. 720 What funds are used to pay for
infrastructure costs in the local one-stop
infrastructure funding mechanism?
361. 725 What happens if consensus on
infrastructure funding is not reached at
the local level between the Local
Workforce Development Board, chief
elected officials, and one-stop partners?
361. 730 What is the State one-stop
infrastructure funding mechanism?
361. 731 What are the steps to determine the
amount to be paid under the State one-
stop infrastructure funding mechanism?
361. 735 How are infrastructure cost budgets
for the one-stop centers in a local area
determined in the State one-stop
infrastructure funding mechanism?
361. 736 How does the Governor establish a
cost allocation methodology used to
determine the one-stop partner
programs' proportionate shares of
infrastructure costs under the State one-
stop infrastructure funding mechanism?
361. 737 How are one-stop partner
programs' proportionate shares of
infrastructure costs determined under
the State one-stop infrastructure funding
mechanism?
361. 738 How are statewide caps on the
contributions for one-stop infrastructure
funding determined in the State one-stop
infrastructure funding mechanism?
361. 740 What funds are used to pay for
infrastructure costs in the State one-stop
infrastructure funding mechanism?
361. 745 What factors does the State
Workforce Development Board use to
develop the formula described in
Workforce Innovation and Opportunity
Act, which is used by the Governor to
determine the appropriate one-stop
infrastructure budget for each local area
operating under the State infrastructure
funding mechanism, if no reasonably
implementable locally negotiated budget
exists?
361. 750 When and how can a one-stop
partner appeal a one-stop infrastructure
amount designated by the State under
the State infrastructure funding
mechanism?
361. 755 What are the required elements
regarding infrastructure funding that
must be included in the one-stop
Memorandum of Understanding?
361.760 How do one-stop partners jointly
fund other shared costs under the
Memorandum of Understanding?
361. 800 How are one-stop centers and one-
stop delivery systems certified for
effectiveness, physical and programmatic
accessibility, and continuous
improvement?
361. 900 What is the common identifier to
be used by each one-stop delivery
system?
Authority: Secs. 503, 107, 121, 134, 189,
Pub. L. 113- 128, 128 Stat. 1425 (Jul. 22,
2014).
56034 Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
Subpart F— Description of the One -
Stop Delivery System Under Title I of
the Workforce Innovation and
Opportunity Act
361. 300 What is the one-stop delivery
system?
a) The one-stop delivery system
brings together workforce development,
educational, and other human resource
services in a seamless customer -focused
service delivery network that enhances
access to the programs' services and
improves long-term employment
outcomes for individuals receiving
assistance. One-stop partners administer
separately funded programs as a set of
integrated streamlined services to
customers.
b) Title I of the Workforce Innovation
and Opportunity Act (WIOA) assigns
responsibilities at the local, State, and
Federal level to ensure the creation and
maintenance of a one-stop delivery
system that enhances the range and
quality of education and workforce
development services that employers
and individual customers can access.
c) The system must include at least
one comprehensive physical center in
each local area as described in
361. 305.
d) The system may also have
additional arrangements to supplement
the comprehensive center. These
arrangements include:
1) An affiliated site or a network of
affiliated sites, where one or more
partners make programs, services, and
activities available, as described in
361. 310;
2) A network of eligible one-stop
partners, as described in §§361.400
through 361. 410, through which each
partner provides one or more of the
programs, services, and activities that
are linked, physically or
technologically, to an affiliated site or
access point that assures customers are
provided information on the availability
of career services, as well as other
program services and activities,
regardless of where they initially enter
the public workforce system in the local
area; and
3) Specialized centers that address
specific needs, including those of
dislocated workers, youth, or key
industry sectors, or clusters.
e) Required one-stop partner
programs must provide access to
programs, services, and activities
through electronic means if applicable
and practicable. This is in addition to
providing access to services through the
mandatory comprehensive physical one-
stop center and any affiliated sites or
specialized centers. The provision of
programs and services by electronic
methods such as Web sites, telephones,
or other means must improve the
efficiency, coordination, and quality of
one-stop partner services. Electronic
delivery must not replace access to such
services at a comprehensive one-stop
center or be a substitute to making
services available at an affiliated site if
the partner is participating in an
affiliated site. Electronic delivery
systems must be in compliance with the
nondiscrimination and equal
opportunity provisions of WIOA sec.
188 and its implementing regulations at
29 CFR part 38.
f) The design of the local area' s one-
stop delivery system must be described
in the Memorandum of Understanding
MOU) executed with the one-stop
partners, described in § 361. 500.
361. 305 What is a comprehensive one-
stop center and what must be provided
there?
a) A comprehensive one-stop center
is a physical location where job seeker
and employer customers can access the
programs, services, and activities of all
required one-stop partners. A
comprehensive one-stop center must
have at least one title I staff person
physically present.
b) The comprehensive one-stop
center must provide:
1) Career services, described in
361. 430;
2) Access to training services
described in 20 CFR 680. 200;
3) Access to any employment and
training activities carried out under sec.
134(d) of WIOA;
4) Access to programs and activities
carried out by one-stop partners listed
in §§ 361. 400 through 361. 410,
including the Employment Service
program authorized under the Wagner-
Peyser Act, as amended by WIOA title
III (Wagner-Peyser Act Employment
Service program); and
5) Workforce and labor market
information.
c) Customers must have access to
these programs, services, and activities
during regular business days at a
comprehensive one-stop center. The
Local Workforce Development Board
WDB) may establish other service hours
at other times to accommodate the
schedules of individuals who work on
regular business days. The State WDB
will evaluate the hours of access to
service as part of the evaluation of
effectiveness in the one-stop
certification process described in
361. 800(b).
d) " Access" to each partner program
and its services means:
1) Having a program staff member
physically present at the one-stop
center;
2) Having a staff member from a
different partner program physically
present at the one-stop center
appropriately trained to provide
information to customers about the
programs, services, and activities
available through partner programs; or
3) Making available a direct linkage
through technology to program staff
who can provide meaningful
information or services.
i) A " direct linkage" means
providing direct connection at the one-
stop center, within a reasonable time, by
phone or through a real-time Web -based
communication to a program staff
member who can provide program
information or services to the customer.
ii) A " direct linkage" cannot
exclusively be providing a phone
number or computer Web site or
providing information, pamphlets, or
materials.
e) All comprehensive one-stop
centers must be physically and
programmatically accessible to
individuals with disabilities, as
described in 29 CFR part 38, the
implementing regulations of WIOA sec.
188.
361. 310 What is an affiliated site and
what must be provided there?
a) An affiliated site, or affiliate one-
stop center, is a site that makes available
to job seeker and employer customers
one or more of the one-stop partners'
programs, services, and activities. An
affiliated site does not need to provide
access to every required one-stop
partner program. The frequency of
program staff's physical presence in the
affiliated site will be determined at the
local level. Affiliated sites are access
points in addition to the comprehensive
one-stop center(s) in each local area. If
used by local areas as a part of the
service delivery strategy, affiliate sites
must be implemented in a manner that
supplements and enhances customer
access to services.
b) As described in § 361. 315, Wagner-
Peyser Act employment services cannot
be a stand-alone affiliated site.
c) States, in conjunction with the
Local WDBs, must examine lease
agreements and property holdings
throughout the one-stop delivery system
in order to use property in an efficient
and effective way. Where necessary and
appropriate, States and Local WDBs
must take expeditious steps to align
lease expiration dates with efforts to
consolidate one-stop operations into
service points where Wagner-Peyser Act
employment services are colocated as
soon as reasonably possible. These steps
must be included in the State Plan.
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d) All affiliated sites must be
physically and programmatically
accessible to individuals with
disabilities, as described in 29 CFR part
38, the implementing regulations of
WIOA sec. 188.
361. 315 Can a stand-alone Wagner-
Peyser Act Employment Service office be
designated as an affiliated one-stop site?
a) Separate stand-alone Wagner-
Peyser Act Employment Service offices
are not permitted under WIOA, as also
described in 20 CFR 652. 202.
b) If Wagner-Peyser Act employment
services are provided at an affiliated
site, there must be at least one or more
other partners in the affiliated site with
a physical presence of combined staff
more than 50 percent of the time the
center is open. Additionally, the other
partner must not be the partner
administering local veterans'
employment representatives, disabled
veterans' outreach program specialists,
or unemployment compensation
programs. If Wagner-Peyser Act
employment services and any of these 3
programs are provided at an affiliated
site, an additional partner or partners
must have a presence of combined staff
in the center more than 50 percent of
the time the center is open.
361. 320 Are there any requirements for
networks of eligible one-stop partners or
specialized centers?
Any network of one-stop partners or
specialized centers, as described in
361. 300( d)( 3), must be connected to
the comprehensive one-stop center and
any appropriate affiliate one-stop
centers, for example, by having
processes in place to make referrals to
these centers and the partner programs
located in them. Wagner-Peyser Act
employment services cannot stand alone
in a specialized center. Just as described
in § 361. 315 for an affiliated site, a
specialized center must include other
programs besides Wagner-Peyser Act
employment services, local veterans'
employment representatives, disabled
veterans' outreach program specialists,
and unemployment compensation.
361. 400 Who are the required one-stop
partners?
a) Section 121(b)( 1)( B) of WIOA
identifies the entities that are required
partners in the local one-stop delivery
systems.
b) The required partners are the
entities responsible for administering
the following programs and activities in
the local area:
1) Programs authorized under title I
of WIOA, including:
i) Adults;
ii) Dislocated workers;
iii)Youth;
iv) Job Corps;
v) YouthBuild;
vi) Native American programs; and
vii) Migrant and seasonal farmworker
programs;
2) The Wagner-Peyser Act
Employment Service program
authorized under the Wagner-Peyser Act
29 U.S. C. 49 et seq.), as amended by
WIOA title III;
3) The Adult Education and Family
Literacy Act (AEFLA) program
authorized under title II of WIOA;
4) The Vocational Rehabilitation (VR)
program authorized under title I of the
Rehabilitation Act of 1973 ( 29 U.S. C.
720 et seq.), as amended by WIOA title
IV;
5) The Senior Community Service
Employment Program authorized under
title V of the Older Americans Act of
1965 ( 42 U. S. C. 3056 et seq.);
6) Career and technical education
programs at the postsecondary level
authorized under the Carl D. Perkins
Career and Technical Education Act of
2006 ( 20 U. S. C. 2301 et seq.);
7) Trade Adjustment Assistance
activities authorized under chapter 2 of
title II of the Trade Act of 1974 ( 19
U. S. C. 2271 et seq.);
8) Jobs for Veterans State Grants
programs authorized under chapter 41
of title 38, U. S. C.;
9) Employment and training
activities carried out under the
Community Services Block Grant (42
U. S. C. 9901 et seq.);
10) Employment and training
activities carried out by the Department
of Housing and Urban Development;
11) Programs authorized under State
unemployment compensation laws (in
accordance with applicable Federal
law);
12) Programs authorized under sec.
212 of the Second Chance Act of 2007
42 U.S. C. 17532); and
13) Temporary Assistance for Needy
Families (TANF) authorized under part
A of title IV of the Social Security Act
42 U. S. C. 601 et seq.), unless exempted
by the Governor under § 361. 405( b).
361. 405 Is Temporary Assistance for
Needy Families a required one-stop
partner?
a) Yes, TANF, authorized under part
A of title IV of the Social Security Act
42 U.S. C. 601 et seq.), is a required
partner.
b) The Governor may determine that
TANF will not be a required partner in
the State, or within some specific local
areas in the State. In this instance, the
Governor must notify the Secretaries of
the U.S. Departments of Labor and
Health and Human Services in writing
of this determination.
c) In States, or local areas within a
State, where the Governor has
determined that TANF is not required to
be a partner, local TANF programs may
still work in collaboration or
partnership with the local one-stop
centers to deliver employment and
training services to the TANF
population unless inconsistent with the
Governor' s direction.
361. 410 What other entities may serve as
one-stop partners?
a) Other entities that carry out a
workforce development program,
including Federal, State, or local
programs and programs in the private
sector, may serve as additional partners
in the one-stop delivery system if the
Local WDB and chief elected official(s)
approve the entity' s participation.
b) Additional partners may include,
but are not limited to:
1) Employment and training
programs administered by the Social
Security Administration, including the
Ticket to Work and Self -Sufficiency
Program established under sec. 1148 of
the Social Security Act (42 U.S. C.
1320b-19);
2) Employment and training
programs carried out by the Small
Business Administration;
3) Supplemental Nutrition Assistance
Program (SNAP) employment and
training programs, authorized under
secs. 6( d)( 4) and 6( o) of the Food and
Nutrition Act of 2008 ( 7 U. S. C.
2015( d)(4));
4) Client Assistance Program
authorized under sec. 112 of the
Rehabilitation Act of 1973 ( 29 U.S. C.
732);
5) Programs authorized under the
National and Community Service Act of
1990 ( 42 U. S. C. 12501 et seq.); and
6) Other appropriate Federal, State or
local programs, including, but not
limited to, employment, education, and
training programs provided by public
libraries or in the private sector.
361. 415 What entity serves as the one-
stop partner for a particular program in the
local area?
a) The entity that carries out the
program and activities listed in
361. 400 or § 361. 410, and therefore
serves as the one-stop partner, is the
grant recipient, administrative entity, or
organization responsible for
administering the funds of the specified
program in the local area. The term
entity" does not include the service
providers that contract with, or are
subrecipients of, the local
administrative entity. For programs that
do not include local administrative
entities, the responsible State agency
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must be the partner. Specific entities for
particular programs are identified in
paragraphs (b) through (e) of this
section. If a program or activity listed in
361. 400 is not carried out in a local
area, the requirements relating to a
required one-stop partner are not
applicable to such program or activity in
that local one-stop delivery system.
b) For title II of WIOA, the entity or
agency that carries out the program for
the purposes of paragraph (a) of this
section is the sole entity or agency in
the State or outlying area responsible for
administering or supervising policy for
adult education and literacy activities in
the State or outlying area. The State
eligible entity or agency may delegate its
responsibilities under paragraph (a) of
this section to one or more eligible
providers or consortium of eligible
providers.
c) For the VR program, authorized
under title I of the Rehabilitation Act of
1973, as amended by WIOA title IV, the
entity that carries out the program for
the purposes of paragraph (a) of this
section is the designated State agencies
or designated State units specified
under sec. 101( a)( 2) of the
Rehabilitation Act that is primarily
concerned with vocational
rehabilitation, or vocational and other
rehabilitation, of individuals with
disabilities.
d) Under WIOA title I, the national
programs, including Job Corps, the
Native American program, YouthBuild,
and Migrant and Seasonal Farmworker
programs are required one-stop partners.
The entity for the Native American
program, YouthBuild, and Migrant and
Seasonal Farmworker programs is the
grantee of those respective programs.
The entity for Job Corps is the Job Corps
center.
e) For the Carl D. Perkins Career and
Technical Education Act of 2006, the
entity that carries out the program for
the purposes of paragraph (a) of this
section is the eligible recipient or
recipients at the postsecondary level, or
a consortium of eligible recipients at the
postsecondary level in the local area.
The eligible recipient at the
postsecondary level may also request
assistance from the State eligible agency
in completing its responsibilities under
paragraph (a) of this section.
361. 420 What are the roles and
responsibilities of the required one-stop
partners?
Each required partner must:
a) Provide access to its programs or
activities through the one-stop delivery
system, in addition to any other
appropriate locations;
b) Use a portion of funds made
available to the partner' s program, to the
extent consistent with the Federal law
authorizing the partner' s program and
with Federal cost principles in 2 CFR
parts 200 and 3474 (requiring, among
other things, that costs are allowable,
reasonable, necessary, and allocable), to:
1) Provide applicable career services;
and
2) Work collaboratively with the
State and Local WDBs to establish and
maintain the one-stop delivery system.
This includes jointly funding the one-
stop infrastructure through partner
contributions that are based upon:
i) A reasonable cost allocation
methodology by which infrastructure
costs are charged to each partner based
on proportionate use and relative
benefit received;
ii) Federal cost principles; and
iii) Any local administrative cost
requirements in the Federal law
authorizing the partner' s program. (This
is further described in § 361. 700.)
c) Enter into an MOU with the Local
WDB relating to the operation of the
one-stop delivery system that meets the
requirements of § 361.500(b);
d) Participate in the operation of the
one-stop delivery system consistent
with the terms of the MOU,
requirements of authorizing laws, the
Federal cost principles, and all other
applicable legal requirements; and
e) Provide representation on the State
and Local WDBs as required and
participate in Board committees as
needed.
361. 425 What are the applicable career
services that must be provided through the
one-stop delivery system by required one-
stop partners?
a) The applicable career services to
be delivered by required one-stop
partners are those services listed in
361. 430 that are authorized to be
provided under each partner' s program.
b) One-stop centers provide services
to individual customers based on
individual needs, including the
seamless delivery of multiple services to
individual customers. There is no
required sequence of services.
361. 430 What are career services?
Career services, as identified in sec.
134( c)( 2) of WIOA, consist of three
types:
a) Basic career services must be made
available and, at a minimum, must
include the following services, as
consistent with allowable program
activities and Federal cost principles:
1) Determinations of whether the
individual is eligible to receive
assistance from the adult, dislocated
worker, or youth programs;
2) Outreach, intake (including worker
profiling), and orientation to
information and other services available
through the one-stop delivery system.
For the TANF program, States must
provide individuals with the
opportunity to initiate an application for
TANF assistance and non -assistance
benefits and services, which could be
implemented through the provision of
paper application forms or links to the
application Web site;
3) Initial assessment of skill levels
including literacy, numeracy, and
English language proficiency, as well as
aptitudes, abilities (including skills
gaps), and supportive services needs;
4) Labor exchange services,
including—
i) Job search and placement
assistance, and, when needed by an
individual, career counseling,
including—
A) Provision of information on in -
demand industry sectors and
occupations ( as defined in sec. 3( 23) of
WIOA); and
B) Provision of information on
nontraditional employment; and
ii) Appropriate recruitment and other
business services on behalf of
employers, including information and
referrals to specialized business services
other than those traditionally offered
through the one-stop delivery system;
5) Provision of referrals to and
coordination of activities with other
programs and services, including
programs and services within the one-
stop delivery system and, when
appropriate, other workforce
development programs;
6) Provision of workforce and labor
market employment statistics
information, including the provision of
accurate information relating to local,
regional, and national labor market
areas, including—
i) Job vacancy listings in labor market
areas;
ii) Information on job skills necessary
to obtain the vacant jobs listed; and
iii) Information relating to local
occupations in demand and the
earnings, skill requirements, and
opportunities for advancement for those
jobs;
7) Provision of performance
information and program cost
information on eligible providers of
education, training, and workforce
services by program and type of
providers;
8) Provision of information, in usable
and understandable formats and
languages, about how the local area is
performing on local performance
accountability measures, as well as any
additional performance information
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relating to the area' s one-stop delivery
system;
9) Provision of information, in usable
and understandable formats and
languages, relating to the availability of
supportive services or assistance, and
appropriate referrals to those services
and assistance, including: Child care;
child support; medical or child health
assistance available through the State' s
Medicaid program and Children' s
Health Insurance Program; benefits
under SNAP; assistance through the
earned income tax credit; and assistance
under a State program for TANF, and
other supportive services and
transportation provided through that
program;
10) Provision of information and
meaningful assistance to individuals
seeking assistance in filing a claim for
unemployment compensation.
i) "Meaningful assistance" means:
A) Providing assistance on-site using
staff who are well-trained in
unemployment compensation claims
filing and the rights and responsibilities
of claimants; or
B) Providing assistance by phone or
via other technology, as long as the
assistance is provided by trained and
available staff and within a reasonable
time.
ii) The costs associated in providing
this assistance may be paid for by the
State' s unemployment insurance
program, or the WIOA adult or
dislocated worker programs, or some
combination thereof.
11) Assistance in establishing
eligibility for programs of financial aid
assistance for training and education
programs not provided under WIOA.
b) Individualized career services
must be made available if determined to
be appropriate in order for an individual
to obtain or retain employment. These
services include the following services,
as consistent with program
requirements and Federal cost
principles:
1) Comprehensive and specialized
assessments of the skill levels and
service needs of adults and dislocated
workers, which may include—
i) Diagnostic testing and use of other
assessment tools; and
ii) In-depth interviewing and
evaluation to identify employment
barriers and appropriate employment
goals;
2) Development of an individual
employment plan, to identify the
employment goals, appropriate
achievement objectives, and appropriate
combination of services for the
participant to achieve his or her
employment goals, including the list of,
and information about, the eligible
training providers (as described in 20
CFR 680. 180);
3) Group counseling;
4) Individual counseling;
5) Career planning;
6) Short-term pre -vocational services
including development of learning
skills, communication skills,
interviewing skills, punctuality,
personal maintenance skills, and
professional conduct services to prepare
individuals for unsubsidized
employment or training;
7) Internships and work experiences
that are linked to careers ( as described
in 20 CFR 680. 170);
8) Workforce preparation activities;
9) Financial literacy services as
described in sec. 129( b)( 2)( D) of WIOA
and 20 CFR 681. 500;
10) Out -of -area job search assistance
and relocation assistance; and
11) English language acquisition and
integrated education and training
programs.
c) Follow-up services must be
provided, as appropriate, including:
Counseling regarding the workplace, for
participants in adult or dislocated
worker workforce investment activities
who are placed in unsubsidized
employment, for up to 12 months after
the first day of employment.
d) In addition to the requirements in
paragraph (a)( 2) of this section, TANF
agencies must identify employment
services and related support being
provided by the TANF program (within
the local area) that qualify as career
services and ensure access to them via
the local one-stop delivery system.
361. 435 What are the business services
provided through the one-stop delivery
system, and how are they provided?
a) Certain career services must be
made available to local employers,
specifically labor exchange activities
and labor market information described
in § 361. 430( a)( 4)( ii) and (a)( 6). Local
areas must establish and develop
relationships and networks with large
and small employers and their
intermediaries. Local areas also must
develop, convene, or implement
industry or sector partnerships.
b) Customized business services may
be provided to employers, employer
associations, or other such
organizations. These services are
tailored for specific employers and may
include:
1) Customized screening and referral
of qualified participants in training
services to employers;
2) Customized services to employers,
employer associations, or other such
organizations, on employment-related
issues;
3) Customized recruitment events
and related services for employers
including targeted job fairs;
4) Human resource consultation
services, including but not limited to
assistance with:
i) Writing/ reviewing job descriptions
and employee handbooks;
ii) Developing performance
evaluation and personnel policies;
iii) Creating orientation sessions for
new workers;
iv) Honing job interview techniques
for efficiency and compliance;
v) Analyzing employee turnover;
vi) Creating job accommodations and
using assistive technologies; or
vii) Explaining labor and
employment laws to help employers
comply with discrimination, wage/ hour,
and safety/ health regulations;
5) Customized labor market
information for specific employers,
sectors, industries or clusters; and
6) Other similar customized services.
c) Local areas may also provide other
business services and strategies that
meet the workforce investment needs of
area employers, in accordance with
partner programs' statutory
requirements and consistent with
Federal cost principles. These business
services may be provided through
effective business intermediaries
working in conjunction with the Local
WDB, or through the use of economic
development, philanthropic, and other
public and private resources in a
manner determined appropriate by the
Local WDB and in cooperation with the
State. Allowable activities, consistent
with each partner' s authorized
activities, include, but are not limited
to:
1) Developing and implementing
industry sector strategies ( including
strategies involving industry
partnerships, regional skills alliances,
industry skill panels, and sectoral skills
partnerships);
2) Customized assistance or referral
for assistance in the development of a
registered apprenticeship program;
3) Developing and delivering
innovative workforce investment
services and strategies for area
employers, which may include career
pathways, skills upgrading, skill
standard development and certification
for recognized postsecondary credential
or other employer use, and other
effective initiatives for meeting the
workforce investment needs of area
employers and workers;
4) Assistance to area employers in
managing reductions in force in
coordination with rapid response
activities and with strategies for the
aversion of layoffs, which may include
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strategies such as early identification of
firms at risk of layoffs, use of feasibility
studies to assess the needs of and
options for at -risk firms, and the
delivery of employment and training
activities to address risk factors;
5) The marketing of business services
to appropriate area employers,
including small and mid-sized
employers; and
6) Assisting employers with
accessing local, State, and Federal tax
credits.
d) All business services and
strategies must be reflected in the local
plan, described in 20 CFR 679.560(b)( 3).
361. 440 When may a fee be charged for
the business services in this subpart?
a) There is no requirement that a fee-
for-service be charged to employers.
b) No fee may be charged for services
provided in § 361. 435( a).
c) A fee may be charged for services
provided under § 361.435(b) and (c).
Services provided under § 361. 435( c)
may be provided through effective
business intermediaries working in
conjunction with the Local WDB and
may also be provided on a fee-for-
service basis or through the leveraging
of economic development,
philanthropic, and other public and
private resources in a manner
determined appropriate by the Local
WDB. The Local WDB may examine the
services provided compared with the
assets and resources available within
the local one-stop delivery system and
through its partners to determine an
appropriate cost structure for services, if
any.
d) Any fees earned are recognized as
program income and must be expended
by the partner in accordance with the
partner program' s authorizing statute,
implementing regulations, and Federal
cost principles identified in Uniform
Guidance.
361. 500 What is the Memorandum of
Understanding for the one-stop delivery
system and what must be included in the
Memorandum of Understanding?
a) The MOU is the product of local
discussion and negotiation, and is an
agreement developed and executed
between the Local WDB and the one-
stop partners, with the agreement of the
chief elected official and the one-stop
partners, relating to the operation of the
one-stop delivery system in the local
area. Two or more local areas in a region
may develop a single joint MOU, if they
are in a region that has submitted a
regional plan under sec. 106 of WIOA.
b) The MOU must include:
1) A description of services to be
provided through the one-stop delivery
system, including the manner in which
the services will be coordinated and
delivered through the system;
2) Agreement on funding the costs of
the services and the operating costs of
the system, including:
i) Funding of infrastructure costs of
one-stop centers in accordance with
361. 700 through 361. 755; and
ii) Funding of the shared services and
operating costs of the one-stop delivery
system described in § 361. 760;
3) Methods for referring individuals
between the one-stop operators and
partners for appropriate services and
activities;
4) Methods to ensure that the needs
of workers, youth, and individuals with
barriers to employment, including
individuals with disabilities, are
addressed in providing access to
services, including access to technology
and materials that are available through
the one-stop delivery system;
5) The duration of the MOU and
procedures for amending it; and
6) Assurances that each MOU will be
reviewed, and if substantial changes
have occurred, renewed, not less than
once every 3 -year period to ensure
appropriate funding and delivery of
services.
c) The MOU may contain any other
provisions agreed to by the parties that
are consistent with WIOA title I, the
authorizing statutes and regulations of
one-stop partner programs, and the
WIOA regulations.
d) When fully executed, the MOU
must contain the signatures of the Local
WDB, one-stop partners, the chief
elected official(s), and the time period
in which the agreement is effective. The
MOU must be updated not less than
every 3 years to reflect any changes in
the signatory official of the Board, one-
stop partners, and chief elected officials,
or one-stop infrastructure funding.
e) If a one-stop partner appeal to the
State regarding infrastructure costs,
using the process described in
361. 750, results in a change to the one-
stop partner' s infrastructure cost
contributions, the MOU must be
updated to reflect the final one-stop
partner infrastructure cost
contributions.
361. 505 Is there a single Memorandum of
Understanding for the local area, or must
there be different Memoranda of
Understanding between the Local
Workforce Development Board and each
partner?
a) A single " umbrella" MOU may be
developed that addresses the issues
relating to the local one-stop delivery
system for the Local WDB, chief elected
official and all partners. Alternatively,
the Local WDB (with agreement of chief
elected official) may enter into separate
agreements between each partner or
groups of partners.
b) Under either approach, the
requirements described in § 361. 500
apply. Since funds are generally
appropriated annually, the Local WDB
may negotiate financial agreements with
each partner annually to update funding
of services and operating costs of the
system under the MOU.
361. 510 How must the Memorandum of
Understanding be negotiated?
a) WIOA emphasizes full and
effective partnerships between Local
WDBs, chief elected officials, and one-
stop partners. Local WDBs and partners
must enter into good -faith negotiations.
Local WDBs, chief elected officials, and
one-stop partners may also request
assistance from a State agency
responsible for administering the
partner program, the Governor, State
WDB, or other appropriate parties on
other aspects of the MOU.
b) Local WDBs and one-stop partners
must establish, in the MOU, how they
will fund the infrastructure costs and
other shared costs of the one-stop
centers. If agreement regarding
infrastructure costs is not reached when
other sections of the MOU are ready, an
interim infrastructure funding
agreement may be included instead, as
described in § 361. 715( c). Once
agreement on infrastructure funding is
reached, the Local WDB and one-stop
partners must amend the MOU to
include the infrastructure funding of the
one-stop centers. Infrastructure funding
is described in detail in §§ 361. 700
through 361. 760.
c) The Local WDB must report to the
State WDB, Governor, and relevant State
agency when MOU negotiations with
one-stop partners have reached an
impasse.
1) The Local WDB and partners must
document the negotiations and efforts
that have taken place in the MOU. The
State WDB, one-stop partner programs,
and the Governor may consult with the
appropriate Federal agencies to address
impasse situations related to issues
other than infrastructure funding after
attempting to address the impasse.
Impasses related to infrastructure cost
funding must be resolved using the
State infrastructure cost funding
mechanism described in § 361. 730.
2) The Local WDB must report failure
to execute an MOU with a required
partner to the Governor, State WDB, and
the State agency responsible for
administering the partner' s program.
Additionally, if the State cannot assist
the Local WDB in resolving the impasse,
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the Governor or the State WDB must
report the failure to the Secretary of
Labor and to the head of any other
Federal agency with responsibility for
oversight of a partner' s program.
361. 600 Who may operate one-stop
centers?
a) One-stop operators may be a single
entity (public, private, or nonprofit) or
a consortium of entities. If the
consortium of entities is one of one-stop
partners, it must include a minimum of
three of the one-stop partners described
in § 361. 400.
b) The one-stop operator may operate
one or more one-stop centers. There
may be more than one one-stop operator
in a local area.
c) The types of entities that may be
a one-stop operator include:
1) An institution of higher education;
2) An Employment Service State
agency established under the Wagner-
Peyser Act;
3) A community-based organization,
nonprofit organization, or workforce
intermediary;
4) A private for-profit entity;
5) A government agency;
6) A Local WDB, with the approval
of the chief elected official and the
Governor; or
7) Another interested organization or
entity, which is capable of carrying out
the duties of the one-stop operator.
Examples may include a local chamber
of commerce or other business
organization, or a labor organization.
d) Elementary schools and secondary
schools are not eligible as one-stop
operators, except that a nontraditional
public secondary school such as a night
school, adult school, or an area career
and technical education school may be
selected.
e) The State and Local WDBs must
ensure that, in carrying out WIOA
programs and activities, one-stop
operators:
1) Disclose any potential conflicts of
interest arising from the relationships of
the operators with particular training
service providers or other service
providers (further discussed in 20 CFR
679. 430);
2) Do not establish practices that
create disincentives to providing
services to individuals with barriers to
employment who may require longer-
term career and training services; and
3) Comply with Federal regulations
and procurement policies relating to the
calculation and use of profits, including
those at 20 CFR 683. 295, the Uniform
Guidance at 2 CFR part 200, and other
applicable regulations and policies.
361. 605 How is the one-stop operator
selected?
a) Consistent with paragraphs (b) and
c) of this section, the Local WDB must
select the one-stop operator through a
competitive process, as required by sec.
121( d)( 2)( A) of WIOA, at least once
every 4 years. A State may require, or
a Local WDB may choose to implement,
a competitive selection process more
than once every 4 years.
b) In instances in which a State is
conducting the competitive process
described in paragraph (a) of this
section, the State must follow the same
policies and procedures it uses for
procurement with non -Federal funds.
c) All other non -Federal entities,
including subrecipients of a State ( such
as local areas), must use a competitive
process based on local procurement
policies and procedures and the
principles of competitive procurement
in the Uniform Guidance set out at 2
CFR 200. 318 through 200. 326. All
references to " noncompetitive
proposals" in the Uniform Guidance at
2 CFR 200.320( f) will be read as " sole
source procurement" for the purposes of
implementing this section.
d) Entities must prepare written
documentation explaining the
determination concerning the nature of
the competitive process to be followed
in selecting a one-stop operator.
361. 610 When is the sole -source
selection of one-stop operators appropriate,
and how is it conducted?
a) States may select a one-stop
operator through sole source selection
when allowed under the same policies
and procedures used for competitive
procurement with non -Federal funds,
while other non -Federal entities
including subrecipients of a State ( such
as local areas) may select a one-stop
operator through sole selection when
consistent with local procurement
policies and procedures and the
Uniform Guidance set out at 2 CFR
200. 320.
b) In the event that sole source
procurement is determined necessary
and reasonable, in accordance with
361. 605( c), written documentation
must be prepared and maintained
concerning the entire process of making
such a selection.
c) Such sole source procurement
must include appropriate conflict of
interest policies and procedures. These
policies and procedures must conform
to the specifications in 20 CFR 679.430
for demonstrating internal controls and
preventing conflict of interest.
d) A Local WDB may be selected as
a one-stop operator through sole source
procurement only with agreement of the
chief elected official in the local area
and the Governor. The Local WDB must
establish sufficient conflict of interest
policies and procedures and these
policies and procedures must be
approved by the Governor.
361. 615 May an entity currently serving
as one-stop operator compete to be a one-
stop operator under the procurement
requirements of this subpart?
a) Local WDBs may compete for and
be selected as one-stop operators, as
long as appropriate firewalls and
conflict of interest policies and
procedures are in place. These policies
and procedures must conform to the
specifications in 20 CFR 679.430 for
demonstrating internal controls and
preventing conflict of interest.
b) State and local agencies may
compete for and be selected as one-stop
operators by the Local WDB, as long as
appropriate firewalls and conflict of
interest policies and procedures are in
place. These policies and procedures
must conform to the specifications in 20
CFR 679. 430 for demonstrating internal
controls and preventing conflict of
interest.
c) In the case of single -area States
where the State WDB serves as the Local
WDB, the State agency is eligible to
compete for and be selected as operator
as long as appropriate firewalls and
conflict of interest policies are in place
and followed for the competition. These
policies and procedures must conform
to the specifications in 20 CFR 679.430
for demonstrating internal controls and
preventing conflicts of interest.
361. 620 What is the one-stop operator' s
role?
a) At a minimum, the one-stop
operator must coordinate the service
delivery of required one-stop partners
and service providers. Local WDBs may
establish additional roles of one-stop
operator, including, but not limited to:
Coordinating service providers across
the one-stop delivery system, being the
primary provider of services within the
center, providing some of the services
within the center, or coordinating
service delivery in a multi -center area,
which may include affiliated sites. The
competition for a one-stop operator
must clearly articulate the role of the
one-stop operator.
b)( 1) Subject to paragraph (b)( 2) of
this section, a one-stop operator may not
perform the following functions:
Convene system stakeholders to assist in
the development of the local plan;
prepare and submit local plans (as
required under sec. 107 of WIOA); be
responsible for oversight of itself;
manage or significantly participate in
56040 Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
the competitive selection process for
one-stop operators; select or terminate
one-stop operators, career services, and
youth providers; negotiate local
performance accountability measures; or
develop and submit budget for activities
of the Local WDB in the local area.
2) An entity serving as a one-stop
operator, that also serves a different role
within the one-stop delivery system,
may perform some or all of these
functions when it is acting in its other
role, if it has established sufficient
firewalls and conflict of interest policies
and procedures. The policies and
procedures must conform to the
specifications in 20 CFR 679.430 for
demonstrating internal controls and
preventing conflict of interest.
361. 625 Can a one-stop operator also be
a service provider?
Yes, but there must be appropriate
firewalls in place in regards to the
competition, and subsequent oversight,
monitoring, and evaluation of
performance of the service provider.
The operator cannot develop, manage,
or conduct the competition of a service
provider in which it intends to compete.
In cases where an operator is also a
service provider, there must be firewalls
and internal controls within the
operator -service provider entity, as well
as specific policies and procedures at
the Local WDB level regarding
oversight, monitoring, and evaluation of
performance of the service provider.
The firewalls must conform to the
specifications in 20 CFR 679.430 for
demonstrating internal controls and
preventing conflicts of interest.
361. 630 Can State merit staff still work in
a one-stop center where the operator is not
a governmental entity?
Yes. State merit staff can continue to
perform functions and activities in the
one-stop center. The Local WDB and
one-stop operator must establish a
system for management of merit staff in
accordance with State policies and
procedures. Continued use of State
merit staff for the provision of Wagner-
Peyser Act services or services from
other programs with merit staffing
requirements must be included in the
competition for and final contract with
the one-stop operator when Wagner-
Peyser Act services or services from
other programs with merit staffing
requirements are being provided.
361. 635 What is the compliance date of
the provisions of this subpart?
a) No later than July 1, 2017, one-stop
operators selected under the
competitive process described in this
subpart must be in place and operating
the one-stop center.
b) By November 17, 2016, every
Local WDB must demonstrate it is
taking steps to prepare for competition
of its one-stop operator. This
demonstration may include, but is not
limited to, market research, requests for
information, and conducting a cost and
price analysis.
361. 700 What are the one-stop
infrastructure costs?
a) Infrastructure costs of one-stop
centers are nonpersonnel costs that are
necessary for the general operation of
the one-stop center, including:
1) Rental of the facilities;
2) Utilities and maintenance;
3) Equipment (including assessment -
related products and assistive
technology for individuals with
disabilities); and
4) Technology to facilitate access to
the one-stop center, including
technology used for the center' s
planning and outreach activities.
b) Local WDBs may consider
common identifier costs as costs of one-
stop infrastructure.
c) Each entity that carries out a
program or activities in a local one-stop
center, described in §§ 361. 400 through
361. 410, must use a portion of the funds
available for the program and activities
to maintain the one-stop delivery
system, including payment of the
infrastructure costs of one-stop centers.
These payments must be in accordance
with this subpart; Federal cost
principles, which require that all costs
must be allowable, reasonable,
necessary, and allocable to the program;
and all other applicable legal
requirements.
361. 705 What guidance must the
Governor issue regarding one-stop
infrastructure funding?
a) The Governor, after consultation
with chief elected officials, the State
WDB, and Local WDBs, and consistent
with guidance and policies provided by
the State WDB, must develop and issue
guidance for use by local areas,
specifically:
1) Guidelines for State -administered
one-stop partner programs for
determining such programs'
contributions to a one-stop delivery
system, based on such programs'
proportionate use of such system, and
relative benefit received, consistent with
Office of Management and Budget
OMB) Uniform Administrative
Requirements, Cost Principles, and
Audit Requirements for Federal Awards
in 2 CFR part 200, including
determining funding for the costs of
infrastructure; and
2) Guidance to assist Local WDBs,
chief elected officials, and one-stop
partners in local areas in determining
equitable and stable methods of funding
the costs of infrastructure at one-stop
centers based on proportionate use and
relative benefit received, and consistent
with Federal cost principles contained
in the Uniform Guidance at 2 CFR part
200.
b) The guidance must include:
1) The appropriate roles of the one-
stop partner programs in identifying
one-stop infrastructure costs;
2) Approaches to facilitate equitable
and efficient cost allocation that results
in a reasonable cost allocation
methodology where infrastructure costs
are charged to each partner based on its
proportionate use of the one-stop
centers and relative benefit received,
consistent with Federal cost principles
at 2 CFR part 200; and
3) The timelines regarding
notification to the Governor for not
reaching local agreement and triggering
the State funding mechanism described
in § 361. 730, and timelines for a one-
stop partner to submit an appeal in the
State funding mechanism.
361. 710 How are infrastructure costs
funded?
Infrastructure costs are funded either
through the local funding mechanism
described in § 361. 715 or through the
State funding mechanism described in
361. 730.
361. 715 How are one-stop infrastructure
costs funded in the local funding
mechanism?
a) In the local funding mechanism,
the Local WDB, chief elected officials,
and one-stop partners agree to amounts
and methods of calculating amounts
each partner will contribute for one-stop
infrastructure funding, include the
infrastructure funding terms in the
MOU, and sign the MOU. The local
funding mechanism must meet all of the
following requirements:
1) The infrastructure costs are funded
through cash and fairly evaluated non-
cash and third -party in-kind partner
contributions and include any funding
from philanthropic organizations or
other private entities, or through other
alternative financing options, to provide
a stable and equitable funding stream
for ongoing one-stop delivery system
operations;
2) Contributions must be negotiated
between one-stop partners, chief elected
officials, and the Local WDB and the
amount to be contributed must be
included in the MOU;
3) The one-stop partner program' s
proportionate share of funding must be
calculated in accordance with the
Uniform Administrative Requirements,
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Cost Principles, and Audit
Requirements for Federal Awards in 2
CFR part 200 based upon a reasonable
cost allocation methodology whereby
infrastructure costs are charged to each
partner in proportion to its use of the
one-stop center, relative to benefits
received. Such costs must also be
allowable, reasonable, necessary, and
allocable;
4) Partner shares must be
periodically reviewed and reconciled
against actual costs incurred, and
adjusted to ensure that actual costs
charged to any one-stop partners are
proportionate to the use of the one-stop
center and relative to the benefit
received by the one-stop partners and
their respective programs or activities.
b) In developing the section of the
MOU on one-stop infrastructure funding
described in § 361. 755, the Local WDB
and chief elected officials will:
1) Ensure that the one-stop partners
adhere to the guidance identified in
361. 705 on one-stop delivery system
infrastructure costs.
2) Work with one-stop partners to
achieve consensus and informally
mediate any possible conflicts or
disagreements among one-stop partners.
3) Provide technical assistance to
new one-stop partners and local grant
recipients to ensure that those entities
are informed and knowledgeable of the
elements contained in the MOU and the
one-stop infrastructure costs
arrangement.
c) The MOU may include an interim
infrastructure funding agreement,
including as much detail as the Local
WDB has negotiated with one-stop
partners, if all other parts of the MOU
have been negotiated, in order to allow
the partner programs to operate in the
one-stop centers. The interim
infrastructure funding agreement must
be finalized within 6 months of when
the MOU is signed. If the interim
infrastructure funding agreement is not
finalized within that timeframe, the
Local WDB must notify the Governor, as
described in § 361. 725.
361. 720 What funds are used to pay for
infrastructure costs in the local one-stop
infrastructure funding mechanism?
a) In the local funding mechanism,
one-stop partner programs may
determine what funds they will use to
pay for infrastructure costs. The use of
these funds must be in accordance with
the requirements in this subpart, and
with the relevant partner' s authorizing
statutes and regulations, including, for
example, prohibitions against
supplanting non -Federal resources,
statutory limitations on administrative
costs, and all other applicable legal
requirements. In the case of partners
administering programs authorized by
title I of WIOA, these infrastructure
costs may be considered program costs.
In the case of partners administering
adult education and literacy programs
authorized by title II of WIOA, these
funds must include Federal funds made
available for the local administration of
adult education and literacy programs
authorized by title II of WIOA. These
funds may also include non -Federal
resources that are cash, in-kind or third -
party contributions. In the case of
partners administering the Carl D.
Perkins Career and Technical Education
Act of 2006, funds used to pay for
infrastructure costs may include funds
available for local administrative
expenses, non -Federal resources that are
cash, in-kind or third -party
contributions, and may include other
funds made available by the State.
b) There are no specific caps on the
amount or percent of overall funding a
one-stop partner may contribute to fund
infrastructure costs under the local
funding mechanism, except that
contributions for administrative costs
may not exceed the amount available for
administrative costs under the
authorizing statute of the partner
program. However, amounts contributed
for infrastructure costs must be
allowable and based on proportionate
use of the one-stop centers and relative
benefit received by the partner program,
taking into account the total cost of the
one-stop infrastructure as well as
alternate financing options, and must be
consistent with 2 CFR part 200,
including the Federal cost principles.
c) Cash, non-cash, and third -party in-
kind contributions may be provided by
one-stop partners to cover their
proportionate share of infrastructure
costs.
1) Cash contributions are cash funds
provided to the Local WDB or its
designee by one-stop partners, either
directly or by an interagency transfer.
2) Non-cash contributions are
comprised of—
i) Expenditures incurred by one-stop
partners on behalf of the one-stop
center; and
ii) Non-cash contributions or goods
or services contributed by a partner
program and used by the one-stop
center.
3) Non-cash contributions, especially
those set forth in paragraph ( c)( 2)( ii) of
this section, must be valued consistent
with 2 CFR 200. 306 to ensure they are
fairly evaluated and meet the partners'
proportionate share.
4) Third -party in-kind contributions
are:
i) Contributions of space, equipment,
technology, non -personnel services, or
other like items to support the
infrastructure costs associated with one-
stop operations, by a non -one-stop
partner to support the one-stop center in
general, not a specific partner; or
ii) Contributions by a non -one-stop
partner of space, equipment,
technology, non -personnel services, or
other like items to support the
infrastructure costs associated with one-
stop operations, to a one-stop partner to
support its proportionate share of one-
stop infrastructure costs.
iii) In-kind contributions described
in paragraphs (c)(4)(i) and (ii) of this
section must be valued consistent with
2 CFR 200. 306 and reconciled on a
regular basis to ensure they are fairly
evaluated and meet the proportionate
share of the partner.
5) All partner contributions,
regardless of the type, must be
reconciled on a regular basis (i.e.,
monthly or quarterly), comparing actual
expenses incurred to relative benefits
received, to ensure each partner
program is contributing its
proportionate share in accordance with
the terms of the MOU.
361. 725 What happens if consensus on
infrastructure funding is not reached at the
local level between the Local Workforce
Development Board, chief elected officials,
and one-stop partners?
With regard to negotiations for
infrastructure funding for Program Year
PY) 2017 and for each subsequent
program year thereafter, if the Local
WDB, chief elected officials, and one-
stop partners do not reach consensus on
methods of sufficiently funding local
infrastructure through the local funding
mechanism in accordance with the
Governor' s guidance issued under
361. 705 and consistent with the
regulations in §§ 361. 715 and 361. 720,
and include that consensus agreement
in the signed MOU, then the Local WDB
must notify the Governor by the
deadline established by the Governor
under § 361. 705( b)( 3). Once notified, the
Governor must administer funding
through the State funding mechanism,
as described in §§ 361. 730 through
361. 738, for the program year impacted
by the local area' s failure to reach
consensus.
361. 730 What is the State one-stop
infrastructure funding mechanism?
a) Consistent with sec.
121(h)(1)( A)(i)(II) of WIOA, if the Local
WDB, chief elected official, and one-
stop partners in a local area do not reach
consensus agreement on methods of
sufficiently funding the costs of
infrastructure of one-stop centers for a
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program year, the State funding
mechanism is applicable to the local
area for that program year.
b) In the State funding mechanism,
the Governor, subject to the limitations
in paragraph ( c) of this section,
determines one-stop partner
contributions after consultation with the
chief elected officials, Local WDBs, and
the State WDB. This determination
involves:
1) The application of a budget for
one-stop infrastructure costs as
described in § 361. 735, based on either
agreement reached in the local area
negotiations or the State WDB formula
outlined in § 361. 745;
2) The determination of each local
one-stop partner program' s
proportionate use of the one-stop
delivery system and relative benefit
received, consistent with the Uniform
Guidance at 2 CFR part 200, including
the Federal cost principles, the partner
programs' authorizing laws and
regulations, and other applicable legal
requirements described in § 361. 736;
and
3) The calculation of required
statewide program caps on
contributions to infrastructure costs
from one-stop partner programs in areas
operating under the State funding
mechanism as described in § 361. 738.
c) In certain situations, the Governor
does not determine the infrastructure
cost contributions for some one-stop
partner programs under the State
funding mechanism.
1) The Governor will not determine
the contribution amounts for
infrastructure funds for Native
American program grantees described in
20 CFR part 684. The appropriate
portion of funds to be provided by
Native American program grantees to
pay for one-stop infrastructure must be
determined as part of the development
of the MOU described in § 361. 500 and
specified in that MOU.
2) In States in which the policy-
making authority is placed in an entity
or official that is independent of the
authority of the Governor with respect
to the funds provided for adult
education and literacy activities
authorized under title II of WIOA,
postsecondary career and technical
education activities authorized under
the Carl D. Perkins Career and Technical
Education Act of 2006, or VR services
authorized under title I of the
Rehabilitation Act of 1973 ( other than
sec. 112 or part C), as amended by
WIOA title IV, the determination of the
amount each of the applicable partners
must contribute to assist in paying the
infrastructure costs of one-stop centers
must be made by the official or chief
officer of the entity with such authority,
in consultation with the Governor.
d) Any duty, ability, choice,
responsibility, or other action otherwise
related to the determination of
infrastructure costs contributions that is
assigned to the Governor in §§361. 730
through 361. 745 also applies to this
decision-making process performed by
the official or chief officer described in
paragraph (c)( 2) of this section.
361. 731 What are the steps to determine
the amount to be paid under the State one-
stop infrastructure funding mechanism?
a) To initiate the State funding
mechanism, a Local WDB that has not
reached consensus on methods of
sufficiently funding local infrastructure
through the local funding mechanism as
provided in § 361. 725 must notify the
Governor by the deadline established by
the Governor under § 361. 705( b)( 3).
b) Once a Local WDB has informed
the Governor that no consensus has
been reached:
1) The Local WDB must provide the
Governor with local negotiation
materials in accordance with
361. 735( a).
2) The Governor must determine the
one-stop center budget by either:
i) Accepting a budget previously
agreed upon by partner programs in the
local negotiations, in accordance with
361. 735( b)( 1); or
ii) Creating a budget for the one-stop
center using the State WDB formula
described in § 361. 745) in accordance
with § 361. 735( b)( 3).
3) The Governor then must establish
a cost allocation methodology to
determine the one-stop partner
programs' proportionate shares of
infrastructure costs, in accordance with
361. 736.
4)( i) Using the methodology
established under paragraph (b)( 2)( ii) of
this section, and taking into
consideration the factors concerning
individual partner programs listed in
361. 737(b)( 2), the Governor must
determine each partner' s proportionate
share of the infrastructure costs, in
accordance with § 361. 737( b)( 1), and
ii) In accordance with § 361. 730( c), in
some instances, the Governor does not
determine a partner program' s
proportionate share of infrastructure
funding costs, in which case it must be
determined by the entities named in
361. 730( c)( 1) and ( 2).
5) The Governor must then calculate
the statewide caps on the amounts that
partner programs may be required to
contribute toward infrastructure
funding, according to the steps found at
361. 738( a)( 1) through (4).
6) The Governor must ensure that the
aggregate total of the infrastructure
contributions according to proportionate
share required of all local partner
programs in local areas under the State
funding mechanism do not exceed the
cap for that particular program, in
accordance with § 361.738(b)(1). If the
total does not exceed the cap, the
Governor must direct each one-stop
partner program to pay the amount
determined under § 361. 737( a) toward
the infrastructure funding costs of the
one-stop center. If the total does exceed
the cap, then to determine the amount
to direct each one-stop program to pay,
the Governor may:
i) Ascertain, in accordance with
361. 738(b)(2)(i),whether the local
partner or partners whose proportionate
shares are calculated above the
individual program caps are willing to
voluntarily contribute above the capped
amount to equal that program' s
proportionate share; or
ii) Choose from the options provided
in § 361. 738(b)(2)(ii), including having
the local area re-enter negotiations to
reassess each one-stop partner' s
proportionate share and make
adjustments or identify alternate sources
of funding to make up the difference
between the capped amount and the
proportionate share of infrastructure
funding of the one-stop partner.
7) If none of the solutions given in
paragraphs (b)(6)(i) and (ii) of this
section prove to be viable, the Governor
must reassess the proportionate shares
of each one-stop partner so that the
aggregate amount attributable to the
local partners for each program is less
than that program' s cap amount. Upon
such reassessment, the Governor must
direct each one-stop partner program to
pay the reassessed amount toward the
infrastructure funding costs of the one-
stop center.
361. 735 How are infrastructure cost
budgets for the one-stop centers in a local
area determined in the State one-stop
infrastructure funding mechanism?
a) Local WDBs must provide to the
Governor appropriate and relevant
materials and documents used in the
negotiations under the local funding
mechanism, including but not limited
to: the local WIOA plan, the cost
allocation method or methods proposed
by the partners to be used in
determining proportionate share, the
proposed amounts or budget to fund
infrastructure, the amount of total
partner funds included, the type of
funds or non-cash contributions,
proposed one-stop center budgets, and
any agreed upon or proposed MOUs.
b)( 1) If a local area has reached
agreement as to the infrastructure
budget for the one-stop centers in the
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local area, it must provide this budget
to the Governor as required by
paragraph (a) of this section. If, as a
result of the agreed upon infrastructure
budget, only the individual
programmatic contributions to
infrastructure funding based upon
proportionate use of the one-stop
centers and relative benefit received are
at issue, the Governor may accept the
budget, from which the Governor must
calculate each partner' s contribution
consistent with the cost allocation
methodologies contained in the Uniform
Guidance found in 2 CFR part 200, as
described in § 361. 736.
2) The Governor may also take into
consideration the extent to which the
partners in the local area have agreed in
determining the proportionate shares,
including any agreements reached at the
local level by one or more partners, as
well as any other element or product of
the negotiating process provided to the
Governor as required by paragraph (a) of
this section.
3) If a local area has not reached
agreement as to the infrastructure
budget for the one-stop centers in the
local area, or if the Governor determines
that the agreed upon budget does not
adequately meet the needs of the local
area or does not reasonably work within
the confines of the local area' s resources
in accordance with the Governor' s one-
stop budget guidance (which is required
to be issued by WIOA sec. 121( h)(1)( B)
and under § 361. 705), then, in
accordance with § 361. 745, the
Governor must use the formula
developed by the State WDB based on
at least the factors required under
361. 745, and any associated weights to
determine the local area budget.
361. 736 How does the Governor
establish a cost allocation methodology
used to determine the one-stop partner
programs' proportionate shares of
infrastructure costs under the State one-
stop infrastructure funding mechanism?
Once the appropriate budget is
determined for a local area through
either method described in § 361. 735
by acceptance of a budget agreed upon
in local negotiation or by the Governor
applying the formula detailed in
361. 745), the Governor must
determine the appropriate cost
allocation methodology to be applied to
the one-stop partners in such local area,
consistent with the Federal cost
principles permitted under 2 CFR part
200, to fund the infrastructure budget.
361. 737 How are one-stop partner
programs' proportionate shares of
infrastructure costs determined under the
State one-stop infrastructure funding
mechanism?
a) The Governor must direct the one-
stop partners in each local area that
have not reached agreement under the
local funding mechanism to pay what
the Governor determines is each partner
program' s proportionate share of
infrastructure funds for that area,
subject to the application of the caps
described in § 361. 738.
b)( 1) The Governor must use the cost
allocation methodology— as determined
under § 361. 736— to determine each
partner' s proportionate share of the
infrastructure costs under the State
funding mechanism, subject to
considering the factors described in
paragraph (b)( 2) of this section.
2) In determining each partner
program' s proportionate share of
infrastructure costs, the Governor must
take into account the costs of
administration of the one-stop delivery
system for purposes not related to one-
stop centers for each partner (such as
costs associated with maintaining the
Local WDB or information technology
systems), as well as the statutory
requirements for each partner program,
the partner program' s ability to fulfill
such requirements, and all other
applicable legal requirements. The
Governor may also take into
consideration the extent to which the
partners in the local area have agreed in
determining the proportionate shares,
including any agreements reached at the
local level by one or more partners, as
well as any other materials or
documents of the negotiating process,
which must be provided to the Governor
by the Local WDB and described in
361. 735( a).
361. 738 How are statewide caps on the
contributions for one-stop infrastructure
funding determined in the State one-stop
infrastructure funding mechanism?
a) The Governor must calculate the
statewide cap on the contributions for
one-stop infrastructure funding required
to be provided by each one-stop partner
program for those local areas that have
not reached agreement. The cap is the
amount determined under paragraph
a)( 4) of this section, which the
Governor derives by:
1) First, determining the amount
resulting from applying the percentage
for the corresponding one-stop partner
program provided in paragraph (d) of
this section to the amount of Federal
funds provided to carry out the one-stop
partner program in the State for the
applicable fiscal year;
2) Second, selecting a factor (or
factors) that reasonably indicates the use
of one-stop centers in the State,
applying such factor(s) to all local areas
in the State, and determining the
percentage of such factor(s) applicable
to the local areas that reached agreement
under the local funding mechanism in
the State;
3) Third, determining the amount
resulting from applying the percentage
determined in paragraph (a)( 2) of this
section to the amount determined under
paragraph (a)( 1) of this section for the
one-stop partner program; and
4) Fourth, determining the amount
that results from subtracting the amount
determined under paragraph (a)( 3) of
this section from the amount
determined under paragraph ( a)( 1) of
this section. The outcome of this final
calculation results in the partner
program' s cap.
b)( 1) The Governor must ensure that
the funds required to be contributed by
each partner program in the local areas
in the State under the State funding
mechanism, in aggregate, do not exceed
the statewide cap for each program as
determined under paragraph ( a) of this
section.
2) If the contributions initially
determined under § 361. 737 would
exceed the applicable cap determined
under paragraph (a) of this section, the
Governor may:
i) Ascertain if the one-stop partner
whose contribution would otherwise
exceed the cap determined under
paragraph (a) of this section will
voluntarily contribute above the capped
amount, so that the total contributions
equal that partner' s proportionate share.
The one-stop partner' s contribution
must still be consistent with the
program' s authorizing laws and
regulations, the Federal cost principles
in 2 CFR part 200, and other applicable
legal requirements; or
ii)Direct or allow the Local WDB,
chief elected officials, and one-stop
partners to: Re-enter negotiations, as
necessary; reduce the infrastructure
costs to reflect the amount of funds that
are available for such costs without
exceeding the cap levels; reassess the
proportionate share of each one-stop
partner; or identify alternative sources
of financing for one-stop infrastructure
funding, consistent with the
requirement that each one-stop partner
pay an amount that is consistent with
the proportionate use of the one-stop
center and relative benefit received by
the partner, the program' s authorizing
laws and regulations, the Federal cost
principles in 2 CFR part 200, and other
applicable legal requirements.
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3) If applicable under paragraph
b)( 2)( ii) of this section, the Local WDB,
chief elected officials, and one-stop
partners, after renegotiation, may come
to agreement, sign an MOU, and
proceed under the local funding
mechanism. Such actions do not require
the redetermination of the applicable
caps under paragraph (a) of this section.
4) If, after renegotiation, agreement
among partners still cannot be reached
or alternate financing cannot be
identified, the Governor may adjust the
specified allocation, in accordance with
the amounts available and the
limitations described in paragraph (d) of
this section. In determining these
adjustments, the Governor may take into
account information relating to the
renegotiation as well as the information
described in § 361. 735( a).
c) Limitations. Subject to paragraph
a) of this section and in accordance
with WIOA sec. 121( h)(2)( D), the
following limitations apply to the
Governor' s calculations of the amount
that one-stop partners in local areas that
have not reached agreement under the
local funding mechanism may be
required under § 361. 736 to contribute
to one-stop infrastructure funding:
1) WIOA formula programs and
Wagner-Peyser Act Employment Service.
The portion of funds required to be
contributed under the WIOA youth,
adult, or dislocated worker programs, or
under the Wagner-Peyser Act (29 U.S.C.
49 et seq.) must not exceed three
percent of the amount of the program in
the State for a program year.
2) Other one-stop partners. For
required one-stop partners other than
those specified in paragraphs ( c)( 1), ( 3),
5), and (6) of this section, the portion
of funds required to be contributed must
not exceed 1. 5 percent of the amount of
Federal funds provided to carry out that
program in the State for a fiscal year.
For purposes of the Carl D. Perkins
Career and Technical Education Act of
2006, the cap on contributions is
determined based on the funds made
available by the State for postsecondary
level programs and activities under sec.
132 of the Carl D. Perkins Career and
Technical Education Act and the
amount of funds used by the State under
sec. 112( a)( 3) of the Perkins Act during
the prior year to administer
postsecondary level programs and
activities, as applicable.
3) Vocational rehabilitation. (i)
Within a State, for the entity or entities
administering the programs described in
WIOA sec. 121( b)( 1)( B)( iv) and
361. 400, the allotment is based on the
one State Federal fiscal year allotment,
even in instances where that allotment
is shared between two State agencies,
and the cumulative portion of funds
required to be contributed must not
exceed—
A) 0. 75 percent of the amount of
Federal funds provided to carry out
such program in the State for Fiscal
Year 2016 for purposes of applicability
of the State funding mechanism for PY
2017;
B) 1. 0 percent of the amount
provided to carry out such program in
the State for Fiscal Year 2017 for
purposes of applicability of the State
funding mechanism for PY 2018;
C) 1. 25 percent of the amount
provided to carry out such program in
the State for Fiscal Year 2018 for
purposes of applicability of the State
funding mechanism for PY 2019;
D) 1. 5 percent of the amount
provided to carry out such program in
the State for Fiscal Year 2019 and
following years for purposes of
applicability of the State funding
mechanism for PY 2020 and subsequent
years.
ii) The limitations set forth in
paragraph (d)( 3)( i) of this section for any
given fiscal year must be based on the
final VR allotment to the State in the
applicable Federal fiscal year.
4) Federal direct spending programs.
For local areas that have not reached a
one-stop infrastructure funding
agreement by consensus, an entity
administering a program funded with
direct Federal spending, as defined in
sec. 250( c)( 8) of the Balanced Budget
and Emergency Deficit Control Act of
1985, as in effect on February 15, 2014
2 U.S. C. 900( c)( 8)), must not be
required to provide more for
infrastructure costs than the amount
that the Governor determined (as
described in § 361. 737).
5) TANF programs. For purposes of
TANF, the cap on contributions is
determined based on the total Federal
TANF funds expended by the State for
work, education, and training activities
during the prior Federal fiscal year (as
reported to the Department of Health
and Human Services ( HHS) on the
quarterly TANF Financial Report form),
plus any additional amount of Federal
TANF funds that the State TANF agency
reasonably determines was expended
for administrative costs in connection
with these activities but that was
separately reported to HHS as an
administrative cost. The State' s
contribution to the one-stop
infrastructure must not exceed 1. 5
percent of these combined expenditures.
6) Community Services Block Grant
CSBG) programs. For purposes of
CSBG, the cap on contributions will be
based on the total amount of CSBG
funds determined by the State to have
been expended by local CSBG-eligible
entities for the provision of employment
and training activities during the prior
Federal fiscal year for which
information is available (as reported to
HHS on the CSBG Annual Report) and
any additional amount that the State
CSBG agency reasonably determines
was expended for administrative
purposes in connection with these
activities and was separately reported to
HHS as an administrative cost. The
State' s contribution must not exceed 1. 5
percent of these combined expenditures.
d) For programs for which it is not
otherwise feasible to determine the
amount of Federal funding used by the
program until the end of that program' s
operational year—because, for example,
the funding available for education,
employment, and training activities is
included within funding for the
program that may also be used for other
unrelated activities—the determination
of the Federal funds provided to carry
out the program for a fiscal year under
paragraph (a)( 1) of this section may be
determined by:
1) The percentage of Federal funds
available to the one-stop partner
program that were used by the one-stop
partner program for education,
employment, and training activities in
the previous fiscal year for which data
are available; and
2) Applying the percentage
determined under paragraph ( d)( 1) of
this section to the total amount of
Federal funds available to the one-stop
partner program for the fiscal year for
which the determination under
paragraph (a)( 1) of this section applies.
361. 740 What funds are used to pay for
infrastructure costs in the State one-stop
infrastructure funding mechanism?
a) In the State funding mechanism,
infrastructure costs for WIOA title I
programs, including Native American
Programs described in 20 CFR part 684,
may be paid using program funds,
administrative funds, or both.
Infrastructure costs for the Senior
Community Service Employment
Program under title V of the Older
Americans Act (42 U.S. C. 3056 et seq.)
may also be paid using program funds,
administrative funds, or both.
b) In the State funding mechanism,
infrastructure costs for other required
one-stop partner programs (listed in
361. 400 through 361. 410) are limited
to the program' s administrative funds,
as appropriate.
c) In the State funding mechanism,
infrastructure costs for the adult
education program authorized by title II
of WIOA must be paid from the funds
that are available for local
56045Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
administration and may be paid from
funds made available by the State or
non -Federal resources that are cash, in-
kind, or third -party contributions.
d) In the State funding mechanism,
infrastructure costs for the Carl D.
Perkins Career and Technical Education
Act of 2006 must be paid from funds
available for local administration of
postsecondary level programs and
activities to eligible recipients or
consortia of eligible recipients and may
be paid from funds made available by
the State or non -Federal resources that
are cash, in-kind, or third -party
contributions.
361. 745 What factors does the State
Workforce Development Board use to
develop the formula described in Workforce
Innovation and Opportunity Act, which is
used by the Governor to determine the
appropriate one-stop infrastructure budget
for each local area operating under the
State infrastructure funding mechanism, if
no reasonably implementable locally
negotiated budget exists?
The State WDB must develop a
formula, as described in WIOA sec.
121(h)(3)( B), to be used by the Governor
under § 361. 735(b)( 3) in determining the
appropriate budget for the infrastructure
costs of one-stop centers in the local
areas that do not reach agreement under
the local funding mechanism and are,
therefore, subject to the State funding
mechanism. The formula identifies the
factors and corresponding weights for
each factor that the Governor must use,
which must include: The number of
one-stop centers in a local area; the
population served by such centers; the
services provided by such centers; and
any factors relating to the operations of
such centers in the local area that the
State WDB determines are appropriate.
As indicated in § 361. 735( b)( 1), if the
local area has agreed on such a budget,
the Governor may accept that budget in
lieu of applying the formula factors.
361. 750 When and how can a one-stop
partner appeal a one-stop infrastructure
amount designated by the State under the
State infrastructure funding mechanism?
a) The Governor must establish a
process, described under sec.
121(h)(2)( E) of WIOA, for a one-stop
partner administering a program
described in §§ 361. 400 through 361. 410
to appeal the Governor' s determination
regarding the one-stop partner' s portion
of funds to be provided for one-stop
infrastructure costs. This appeal process
must be described in the Unified State
Plan.
b) The appeal may be made on the
ground that the Governor' s
determination is inconsistent with
proportionate share requirements in
361. 735( a), the cost contribution
limitations in § 361. 735(b), the cost
contribution caps in § 361. 738,
consistent with the process described in
the State Plan.
c) The process must ensure prompt
resolution of the appeal in order to
ensure the funds are distributed in a
timely manner, consistent with the
requirements of 20 CFR 683. 630.
d) The one-stop partner must submit
an appeal in accordance with State' s
deadlines for appeals specified in the
guidance issued under § 361. 705( b)( 3),
or if the State has not set a deadline,
within 21 days from the Governor' s
determination.
361. 755 What are the required elements
regarding infrastructure funding that must
be included in the one-stop Memorandum
of Understanding?
The MOU, fully described in
361. 500, must contain the following
information whether the local areas use
either the local one-stop or the State
funding method:
a) The period of time in which this
infrastructure funding agreement is
effective. This may be a different time
period than the duration of the MOU.
b) Identification of an infrastructure
and shared services budget that will be
periodically reconciled against actual
costs incurred and adjusted accordingly
to ensure that it reflects a cost allocation
methodology that demonstrates how
infrastructure costs are charged to each
partner in proportion to its use of the
one-stop center and relative benefit
received, and that complies with 2 CFR
part 200 ( or any corresponding similar
regulation or ruling).
c) Identification of all one-stop
partners, chief elected officials, and
Local WDB participating in the
infrastructure funding arrangement.
d) Steps the Local WDB, chief elected
officials, and one-stop partners used to
reach consensus or an assurance that the
local area followed the guidance for the
State funding process.
e) Description of the process to be
used among partners to resolve issues
during the MOU duration period when
consensus cannot be reached.
f) Description of the periodic
modification and review process to
ensure equitable benefit among one-stop
partners.
361. 760 How do one-stop partners jointly
fund other shared costs under the
Memorandum of Understanding?
a) In addition to jointly funding
infrastructure costs, one-stop partners
listed in §§361.400 through 361.410
must use a portion of funds made
available under their programs'
authorizing Federal law (or fairly
evaluated in-kind contributions) to pay
the additional costs relating to the
operation of the one-stop delivery
system. These other costs must include
applicable career services and may
include other costs, including shared
services.
b) For the purposes of paragraph ( a)
of this section, shared services' costs
may include the costs of shared services
that are authorized for and may be
commonly provided through the one-
stop partner programs to any individual,
such as initial intake, assessment of
needs, appraisal of basic skills,
identification of appropriate services to
meet such needs, referrals to other one-
stop partners, and business services.
Shared operating costs may also include
shared costs of the Local WDB' s
functions.
c) Contributions to the additional
costs related to operation of the one-stop
delivery system may be cash, non-cash,
or third -party in-kind contributions,
consistent with how these are described
in § 361. 720( c).
d) The shared costs described in
paragraph (a) of this section must be
allocated according to the proportion of
benefit received by each of the partners,
consistent with the Federal law
authorizing the partner' s program, and
consistent with all other applicable legal
requirements, including Federal cost
principles in 2 CFR part 200 ( or any
corresponding similar regulation or
ruling) requiring that costs are
allowable, reasonable, necessary, and
allocable.
e) Any shared costs agreed upon by
the one-stop partners must be included
in the MOU.
361. 800 How are one-stop centers and
one-stop delivery systems certified for
effectiveness, physical and programmatic
accessibility, and continuous
improvement?
a) The State WDB, in consultation
with chief elected officials and Local
WDBs, must establish objective criteria
and procedures for Local WDBs to use
when certifying one-stop centers.
1) The State WDB, in consultation
with chief elected officials and Local
WDBs, must review and update the
criteria every 2 years as part of the
review and modification of State Plans
pursuant to § 361. 135.
2) The criteria must be consistent
with the Governor' s and State WDB' s
guidelines, guidance, and policies on
infrastructure funding decisions,
described in § 361. 705. The criteria
must evaluate the one-stop centers and
one-stop delivery system for
effectiveness, including customer
satisfaction, physical and programmatic
56046 Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
accessibility, and continuous
improvement.
3) When the Local WDB is the one-
stop operator as described in 20 CFR
679. 410, the State WDB must certify the
one-stop center.
b) Evaluations of effectiveness must
include how well the one-stop center
integrates available services for
participants and businesses, meets the
workforce development needs of
participants and the employment needs
of local employers, operates in a cost-
efficient manner, coordinates services
among the one-stop partner programs,
and provides access to partner program
services to the maximum extent
practicable, including providing
services outside of regular business
hours where there is a workforce need,
as identified by the Local WDB. These
evaluations must take into account
feedback from one-stop customers. They
must also include evaluations of how
well the one-stop center ensures equal
opportunity for individuals with
disabilities to participate in or benefit
from one-stop center services. These
evaluations must include criteria
evaluating how well the centers and
delivery systems take actions to comply
with the disability -related regulations
implementing WIOA sec. 188, set forth
at 29 CFR part 38. Such actions include,
but are not limited to:
1) Providing reasonable
accommodations for individuals with
disabilities;
2) Making reasonable modifications
to policies, practices, and procedures
where necessary to avoid discrimination
against persons with disabilities;
3) Administering programs in the
most integrated setting appropriate;
4) Communicating with persons with
disabilities as effectively as with others;
5) Providing appropriate auxiliary
aids and services, including assistive
technology devices and services, where
necessary to afford individuals with
disabilities an equal opportunity to
participate in, and enjoy the benefits of,
the program or activity; and
6) Providing for the physical
accessibility of the one-stop center to
individuals with disabilities.
c) Evaluations of continuous
improvement must include how well
the one-stop center supports the
achievement of the negotiated local
levels of performance for the indicators
of performance for the local area
described in sec. 116(b)( 2) of WIOA and
part 361. Other continuous
improvement factors may include a
regular process for identifying and
responding to technical assistance
needs, a regular system of continuing
professional staff development, and
having systems in place to capture and
respond to specific customer feedback.
d) Local WDBs must assess at least
once every 3 years the effectiveness,
physical and programmatic
accessibility, and continuous
improvement of one-stop centers and
the one-stop delivery systems using the
criteria and procedures developed by
the State WDB. The Local WDB may
establish additional criteria, or set
higher standards for service
coordination, than those set by the State
criteria. Local WDBs must review and
update the criteria every 2 years as part
of the Local Plan update process
described in § 361. 580. Local WDBs
must certify one-stop centers in order to
be eligible to use infrastructure funds in
the State funding mechanism described
in § 361. 730.
e) All one-stop centers must comply
with applicable physical and
programmatic accessibility
requirements, as set forth in 29 CFR part
38, the implementing regulations of
WIOA sec. 188.
361. 900 What is the common identifier to
be used by each one-stop delivery system?
a) The common one-stop delivery
system identifier is " American Job
Center."
b) As of November 17, 2016, each
one-stop delivery system must include
the " American Job Center" identifier or
a proud partner of the American Job
Center network" on all primary
electronic resources used by the one-
stop delivery system, and on any newly
printed, purchased, or created materials.
c) As of July 1, 2017, each one-stop
delivery system must include the
American Job Center" identifier or " a
proud partner of the American Job
Center network" on all products,
programs, activities, services, electronic
resources, facilities, and related
property and new materials used in the
one-stop delivery system.
d) One-stop partners, States, or local
areas may use additional identifiers on
their products, programs, activities,
services, facilities, and related property
and materials.
PART 463— ADULT EDUCATION AND
FAMILY LITERACY ACT
8. The authority citation for part 463
continues to read as follows:
Authority: 29 U. S. C. 102 and 103, unless
otherwise noted.
9. Add subpart H to part 463, as added
elsewhere in this issue of the Federal
Register, to read as follows:
Subpart H— Unified and Combined State
Plans Under Title I of the Workforce
Innovation and Opportunity Act
Sec.
463. 100 What are the purposes of the
Unified and Combined State Plans?
463. 105 What are the general requirements
for the Unified State Plan?
463. 110 What are the program -specific
requirements in the Unified State Plan
for the adult, dislocated worker, and
youth programs authorized under
Workforce Innovation and Opportunity
Act title I?
463. 115 What are the program -specific
requirements in the Unified State Plan
for the Adult Education and Family
Literacy Act program authorized under
Workforce Innovation and Opportunity
Act title II?
463. 120 What are the program -specific
requirements in the Unified State Plan
for the Employment Service program
authorized under the Wagner-Peyser Act,
as amended by Workforce Innovation
and Opportunity Act title III?
463. 125 What are the program -specific
requirements in the Unified State Plan
for the State Vocational Rehabilitation
program authorized under title I of the
Rehabilitation Act of 1973, as amended
by Workforce Innovation and
Opportunity Act title IV?
463. 130 What is the development,
submission, and approval process of the
Unified State Plan?
463. 135 What are the requirements for
modification of the Unified State Plan?
463. 140 What are the general requirements
for submitting a Combined State Plan?
463. 143 What is the development,
submission, and approval process of the
Combined State Plan?
463. 145 What are the requirements for
modifications of the Combined State
Plan?
Authority: Secs. 102, 103, and 503, Pub. L.
113-128, 128 Stat. 1425 ( Jul. 22, 2014).
Subpart H— Unified and Combined
State Plans Under Title I of the
Workforce Innovation and Opportunity
Act
463.100 What are the purposes of the
Unified and Combined State Plans?
a) The Unified and Combined State
Plans provide the framework for States
to outline a strategic vision of, and goals
for, how their workforce development
systems will achieve the purposes of the
Workforce Innovation and Opportunity
Act (WIOA).
b) The Unified and Combined State
Plans serve as 4 -year action plans to
develop, align, and integrate the State' s
systems and provide a platform to
achieve the State' s vision and strategic
and operational goals. A Unified or
Combined State Plan is intended to:
1) Align, in strategic coordination,
the six core programs required in the
Unified State Plan pursuant to
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463. 105(b), and additional Combined
State Plan partner programs that may be
part of the Combined State Plan
pursuant to § 463. 140;
2) Direct investments in economic,
education, and workforce training
programs to focus on providing relevant
education and training to ensure that
individuals, including youth and
individuals with barriers to
employment, have the skills to compete
in the job market and that employers
have a ready supply of skilled workers;
3) Apply strategies for job -driven
training consistently across Federal
programs; and
4) Enable economic, education, and
workforce partners to build a skilled
workforce through innovation in, and
alignment of, employment, training, and
education programs.
463.105 What are the general
requirements for the Unified State Plan?
a) The Unified State Plan must be
submitted in accordance with §463.130
and WIOA sec. 102( c), as explained in
joint planning guidelines issued by the
Secretaries of Labor and Education.
b) The Governor of each State must
submit, at a minimum, in accordance
with §463. 130, a Unified State Plan to
the Secretary of Labor to be eligible to
receive funding for the workforce
development system' s six core
programs:
1) The adult, dislocated worker, and
youth programs authorized under
subtitle B of title I of WIOA and
administered by the U.S. Department of
Labor (DOL);
2) The Adult Education and Family
Literacy Act (AEFLA) program
authorized under title II of WIOA and
administered by the U.S. Department of
Education (ED);
3) The Employment Service program
authorized under the Wagner-Peyser Act
of 1933, as amended by WIOA title III
and administered by DOL; and
4) The Vocational Rehabilitation
program authorized under title I of the
Rehabilitation Act of 1973, as amended
by title IV of WIOA and administered by
ED.
c) The Unified State Plan must
outline the State' s 4 -year strategy for the
core programs described in paragraph
b) of this section and meet the
requirements of sec. 102(b) of WIOA, as
explained in the joint planning
guidelines issued by the Secretaries of
Labor and Education.
d) The Unified State Plan must
include strategic and operational
planning elements to facilitate the
development of an aligned, coordinated,
and comprehensive workforce
development system. The Unified State
Plan must include:
1) Strategic planning elements that
describe the State' s strategic vision and
goals for preparing an educated and
skilled workforce under sec. 102( b)( 1) of
WIOA. The strategic planning elements
must be informed by and include an
analysis of the State' s economic
conditions and employer and workforce
needs, including education and skill
needs.
2) Strategies for aligning the core
programs and Combined State Plan
partner programs as described in
463. 140( d), as well as other resources
available to the State, to achieve the
strategic vision and goals in accordance
with sec. 102( b)( 1)( E) of WIOA.
3) Operational planning elements in
accordance with sec. 102(b)( 2) of WIOA
that support the strategies for aligning
the core programs and other resources
available to the State to achieve the
State' s vision and goals and a
description of how the State Workforce
Development Board (WDB) will
implement its functions, in accordance
with sec. 101( d) of WIOA. Operational
planning elements must include:
i) A description of how the State
strategy will be implemented by each
core program' s lead State agency;
ii) State operating systems, including
data systems, and policies that will
support the implementation of the
State' s strategy identified in paragraph
d)(1) of this section;
iii) Program -specific requirements for
the core programs required by WIOA
sec. 102(b)( 2)( D);
iv) Assurances required by sec.
102( b)( 2)( E) of WIOA, including an
assurance that the lead State agencies
responsible for the administration of the
core programs reviewed and commented
on the appropriate operational planning
of the Unified State Plan and approved
the elements as serving the needs of the
population served by such programs,
and other assurances deemed necessary
by the Secretaries of Labor and
Education under sec. 102( b)( 2)( E)( x) of
WIOA;
v) A description of joint planning
and coordination across core programs,
required one-stop partner programs, and
other programs and activities in the
Unified State Plan; and
vi) Any additional operational
planning requirements imposed by the
Secretary of Labor or the Secretary of
Education under sec. 102(b)( 2)( C)(viii)
of WIOA.
e) All of the requirements in this
subpart that apply to States also apply
to outlying areas.
463.110 What are the program -specific
requirements in the Unified State Plan for
the adult, dislocated worker, and youth
programs authorized under Workforce
Innovation and Opportunity Act title I?
The program -specific requirements for
the adult, dislocated worker, and youth
programs that must be included in the
Unified State Plan are described in sec.
102( b)( 2)( D) of WIOA. Additional
planning requirements may be
explained in joint planning guidelines
issued by the Secretaries of Labor and
Education.
463.115 What are the program -specific
requirements in the Unified State Plan for
the Adult Education and Family Literacy Act
program authorized under Workforce
Innovation and Opportunity Act title II?
The program -specific requirements for
the AEFLA program in title II that must
be included in the Unified State Plan
are described in secs. 102( b)( 2)( C) and
102( b)( 2)( D)( ii) of WIOA.
a) With regard to the description
required in sec. 102( b)( 2)( D)( ii)(I) of
WIOA pertaining to content standards,
the Unified State Plan must describe
how the eligible agency will, by July 1,
2016, align its content standards for
adult education with State -adopted
challenging academic content standards
under the Elementary and Secondary
Education Act of 1965, as amended.
b) With regard to the description
required in sec. 102( b)( 2)( C)( iv) of
WIOA pertaining to the methods and
factors the State will use to distribute
funds under the core programs, for title
II of WIOA, the Unified State Plan must
include—
1) How the eligible agency will
award multi-year grants on a
competitive basis to eligible providers
in the State; and
2) How the eligible agency will
provide direct and equitable access to
funds using the same grant or contract
announcement and application
procedure.
463.120 What are the program -specific
requirements in the Unified State Plan for
the Employment Service program
authorized under the Wagner-Peyser Act, as
amended by Workforce Innovation and
Opportunity Act title Ill?
The Employment Service program
authorized under the Wagner-Peyser Act
of 1933, as amended by WIOA title III,
is subject to requirements in sec. 102( b)
of WIOA, including any additional
requirements imposed by the Secretary
of Labor under secs. 102(b)( 2)( C)(viii)
and 102( b)( 2)( D)( iv) of WIOA, as
explained in joint planning guidelines
issued by the Secretaries of Labor and
Education.
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463.125 What are the program -specific
requirements in the Unified State Plan for
the State Vocational Rehabilitation program
authorized under title I of the Rehabilitation
Act of 1973, as amended by Workforce
Innovation and Opportunity Act title IV?
The program specific -requirements for
the vocational rehabilitation services
portion of the Unified or Combined
State Plan are set forth in sec. 101( a) of
the Rehabilitation Act of 1973, as
amended. All submission requirements
for the vocational rehabilitation services
portion of the Unified or Combined
State Plan are in addition to the jointly
developed strategic and operational
content requirements prescribed by sec.
102(b) of WIOA.
463. 130 What is the development,
submission, and approval process of the
Unified State Plan?
a) The Unified State Plan described
in § 463. 105 must be submitted in
accordance with WIOA sec. 102( c), as
explained in joint planning guidelines
issued jointly by the Secretaries of Labor
and Education.
b) A State must submit its Unified
State Plan to the Secretary of Labor
pursuant to a process identified by the
Secretary.
1) The initial Unified State Plan must
be submitted no later than 120 days
prior to the commencement of the
second full program year of WIOA.
2) Subsequent Unified State Plans
must be submitted no later than 120
days prior to the end of the 4 -year
period covered by a preceding Unified
State Plan.
3) For purposes of paragraph (b) of
this section, " program year" means July
1 through June 30 of any year.
c) The Unified State Plan must be
developed with the assistance of the
State WDB, as required by 20 CFR
679. 130( a) and WIOA sec. 101( d), and
must be developed in coordination with
administrators with optimum policy-
making authority for the core programs
and required one-stop partners.
d) The State must provide an
opportunity for public comment on and
input into the development of the
Unified State Plan prior to its
submission.
1) The opportunity for public
comment must include an opportunity
for comment by representatives of Local
WDBs and chief elected officials,
businesses, representatives of labor
organizations, community-based
organizations, adult education
providers, institutions of higher
education, other stakeholders with an
interest in the services provided by the
six core programs, and the general
public, including individuals with
disabilities.
2) Consistent with the " Sunshine
Provision" of WIOA in sec. 101( g), the
State WDB must make information
regarding the Unified State Plan
available to the public through
electronic means and regularly
occurring open meetings in accordance
with State law. The Unified State Plan
must describe the State' s process and
timeline for ensuring a meaningful
opportunity for public comment.
e) Upon receipt of the Unified State
Plan from the State, the Secretary of
Labor will ensure that the entire Unified
State Plan is submitted to the Secretary
of Education pursuant to a process
developed by the Secretaries.
f) The Unified State Plan is subject to
the approval of both the Secretary of
Labor and the Secretary of Education.
g) Before the Secretaries of Labor and
Education approve the Unified State
Plan, the vocational rehabilitation
services portion of the Unified State
Plan described in WIOA sec.
102( b)( 2)( D)( iii) must be approved by
the Commissioner of the Rehabilitation
Services Administration.
h) The Secretaries of Labor and
Education will review and approve the
Unified State Plan within 90 days of
receipt by the Secretary of Labor, unless
the Secretary of Labor or the Secretary
of Education determines in writing
within that period that:
1) The plan is inconsistent with a
core program' s requirements;
2) The Unified State Plan is
inconsistent with any requirement of
sec. 102 of WIOA; or
3) The plan is incomplete or
otherwise insufficient to determine
whether it is consistent with a core
program' s requirements or other
requirements of WIOA.
i) If neither the Secretary of Labor nor
the Secretary of Education makes the
written determination described in
paragraph (h) of this section within 90
days of the receipt by the Secretaries,
the Unified State Plan will be
considered approved.
463. 135 What are the requirements for
modification of the Unified State Plan?
a) In addition to the required
modification review set forth in
paragraph (b) of this section, a Governor
may submit a modification of its Unified
State Plan at any time during the 4 -year
period of the plan.
b) Modifications are required, at a
minimum:
1) At the end of the first 2 -year
period of any 4 -year State Plan, wherein
the State WDB must review the Unified
State Plan, and the Governor must
submit modifications to the plan to
reflect changes in labor market and
economic conditions or other factors
affecting the implementation of the
Unified State Plan;
2) When changes in Federal or State
law or policy substantially affect the
strategies, goals, and priorities upon
which the Unified State Plan is based;
3) When there are changes in the
statewide vision, strategies, policies,
State negotiated levels of performance
as described in §463. 170(b), the
methodology used to determine local
allocation of funds, reorganizations that
change the working relationship with
system employees, changes in
organizational responsibilities, changes
to the membership structure of the State
WDB or alternative entity, and similar
substantial changes to the State' s
workforce development system.
c) Modifications to the Unified State
Plan are subject to the same public
review and comment requirements in
463. 130( d) that apply to the
development of the original Unified
State Plan.
d) Unified State Plan modifications
must be approved by the Secretaries of
Labor and Education, based on the
approval standards applicable to the
original Unified State Plan under
463. 130. This approval must come
after the approval of the Commissioner
of the Rehabilitation Services
Administration for modification of any
portion of the plan described in sec.
102(b)(2)( D)(iii) of WIOA.
463. 140 What are the general
requirements for submitting a Combined
State Plan?
a) A State may choose to develop and
submit a 4 -year Combined State Plan in
lieu of the Unified State Plan described
in §§463. 105 through 463. 125.
b) A State that submits a Combined
State Plan covering an activity or
program described in paragraph ( d) of
this section that is, in accordance with
WIOA sec. 103( c), approved or deemed
complete under the law relating to the
program will not be required to submit
any other plan or application in order to
receive Federal funds to carry out the
core programs or the program or
activities described under paragraph ( d)
of this section that are covered by the
Combined State Plan.
c) If a State develops a Combined
State Plan, it must be submitted in
accordance with the process described
in §463. 143.
d) If a State chooses to submit a
Combined State Plan, the plan must
include the six core programs and one
or more of the Combined State Plan
partner programs and activities
described in sec. 103( a)( 2) of WIOA. The
Combined State Plan partner programs
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and activities that may be included in
the Combined State Plan are:
1) Career and technical education
programs authorized under the Carl D.
Perkins Career and Technical Education
Act of 2006 ( 20 U. S. C. 2301 et seq.);
2) Temporary Assistance for Needy
Families or TANF, authorized under
part A of title IV of the Social Security
Act (42 U.S. C. 601 et seq.);
3) Employment and training
programs authorized under sec. 6( d)( 4)
of the Food and Nutrition Act of 2008
7 U.S. C. 2015( d)(4));
4) Work programs authorized under
sec. 6( o) of the Food and Nutrition Act
of 2008 ( 7 U.S. C. 2015( o));
5) Trade adjustment assistance
activities under chapter 2 of title II of
the Trade Act of 1974 ( 19 U. S. C. 2271
et seq.);
6) Services for veterans authorized
under chapter 41 of title 38 United
States Code;
7) Programs authorized under State
unemployment compensation laws (in
accordance with applicable Federal
law);
8) Senior Community Service
Employment Programs under title V of
the Older Americans Act of 1965 ( 42
U.S. C. 3056 et seq.);
9) Employment and training
activities carried out by the Department
of Housing and Urban Development
HUD);
10) Employment and training
activities carried out under the
Community Services Block Grant Act
42 U.S. C. 9901 et seq.); and
11) Reintegration of offenders
programs authorized under sec. 212 of
the Second Chance Act of 2007 ( 42
U.S. C. 17532).
e) A Combined State Plan must
contain:
1) For the core programs, the
information required by sec. 102(b) of
WIOA and §§ 463. 105 through 463. 125,
as explained in the joint planning
guidelines issued by the Secretaries;
2) For the Combined State Plan
partner programs and activities, except
as described in paragraph (h) of this
section, the information required by the
law authorizing and governing that
program to be submitted to the
appropriate Secretary, any other
applicable legal requirements, and any
common planning requirements
described in sec. 102(b) of WIOA, as
explained in the joint planning
guidelines issued by the Secretaries;
3) A description of the methods used
for joint planning and coordination
among the core programs, and with the
required one-stop partner programs and
other programs and activities included
in the State Plan; and
4) An assurance that all of the
entities responsible for planning or
administering the programs described in
the Combined State Plan have had a
meaningful opportunity to review and
comment on all portions of the plan.
f) Each Combined State Plan partner
program included in the Combined
State Plan remains subject to the
applicable program -specific
requirements of the Federal law and
regulations, and any other applicable
legal or program requirements,
governing the implementation and
operation of that program.
g) For purposes of §§463. 140 through
463. 145 the term " appropriate
Secretary" means the head of the
Federal agency who exercises either
plan or application approval authority
for the program or activity under the
Federal law authorizing the program or
activity or, if there are no planning or
application requirements, who exercises
administrative authority over the
program or activity under that Federal
law.
h) States that include employment
and training activities carried out under
the Community Services Block Grant
CSBG) Act (42 U. S. C. 9901 et seq.)
under a Combined State Plan would
submit all other required elements of a
complete CSBG State Plan directly to
the Federal agency that administers the
program, according to the requirements
of Federal law and regulations.
i) States that submit employment and
training activities carried out by HUD
under a Combined State Plan would
submit any other required planning
documents for HUD programs directly
to HUD, according to the requirements
of Federal law and regulations.
463. 143 What is the development,
submission, and approval process of the
Combined State Plan?
a) For purposes of §463.140(a), if a
State chooses to develop a Combined
State Plan it must submit the Combined
State Plan in accordance with the
requirements described below and sec.
103 of WIOA, as explained in the joint
planning guidelines issued by the
Secretaries of Labor and Education.
b) The Combined State Plan must be
developed with the assistance of the
State WDB, as required by 20 CFR
679. 130( a) and WIOA sec. 101( d), and
must be developed in coordination with
administrators with optimum policy-
making authority for the core programs
and required one-stop partners.
c) The State must provide an
opportunity for public comment on and
input into the development of the
Combined State Plan prior to its
submission.
1) The opportunity for public
comment for the portions of the
Combined State Plan that cover the core
programs must include an opportunity
for comment by representatives of Local
WDBs and chief elected officials,
businesses, representatives of labor
organizations, community-based
organizations, adult education
providers, institutions of higher
education, other stakeholders with an
interest in the services provided by the
six core programs, and the general
public, including individuals with
disabilities.
2) Consistent with the " Sunshine
Provision" of WIOA in sec. 101( g), the
State WDB must make information
regarding the Combined State Plan
available to the public through
electronic means and regularly
occurring open meetings in accordance
with State law. The Combined State
Plan must describe the State' s process
and timeline for ensuring a meaningful
opportunity for public comment on the
portions of the plan covering core
programs.
3) The portions of the plan that cover
the Combined State Plan partner
programs are subject to any public
comment requirements applicable to
those programs.
d) The State must submit to the
Secretaries of Labor and Education and
to the Secretary of the agency with
responsibility for approving the
program' s plan or deeming it complete
under the law governing the program, as
part of its Combined State Plan, any
plan, application, form, or any other
similar document that is required as a
condition for the approval of Federal
funding under the applicable program
or activity. Such submission must occur
in accordance with a process identified
by the relevant Secretaries in paragraph
a) of this section.
e) The Combined State Plan will be
approved or disapproved in accordance
with the requirements of sec. 103( c) of
WIOA.
1) The portion of the Combined State
Plan covering programs administered by
the Departments of Labor and Education
must be reviewed, and approved or
disapproved, by the appropriate
Secretary within 90 days beginning on
the day the Combined State Plan is
received by the appropriate Secretary
from the State, consistent with
paragraph (f) of this section. Before the
Secretaries of Labor and Education
approve the Combined State Plan, the
vocational rehabilitation services
portion of the Combined State Plan
described in WIOA sec. 102( b)( 2)( D)( iii)
must be approved by the Commissioner
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of the Rehabilitation Services
Administration.
2) If an appropriate Secretary other
than the Secretary of Labor or the
Secretary of Education has authority to
approve or deem complete a portion of
the Combined State Plan for a program
or activity described in § 463. 140( d),
that portion of the Combined State Plan
must be reviewed, and approved,
disapproved, or deemed complete, by
the appropriate Secretary within 120
days beginning on the day the
Combined State Plan is received by the
appropriate Secretary from the State
consistent with paragraph (f) of this
section.
f) The appropriate Secretaries will
review and approve or deem complete
the Combined State Plan within 90 or
120 days, as appropriate, as described in
paragraph (e) of this section, unless the
Secretaries of Labor and Education or
appropriate Secretary have determined
in writing within that period that:
1) The Combined State Plan is
inconsistent with the requirements of
the six core programs or the Federal
laws authorizing or applicable to the
program or activity involved, including
the criteria for approval of a plan or
application, or deeming the plan
complete, if any, under such law;
2) The portion of the Combined State
Plan describing the six core programs or
the program or activity described in
paragraph (a) of this section involved
does not satisfy the criteria as provided
in sec. 102 or 103 of WIOA, as
applicable; or
3) The Combined State Plan is
incomplete, or otherwise insufficient to
determine whether it is consistent with
a core program' s requirements, other
requirements of WIOA, or the Federal
laws authorizing, or applicable to, the
program or activity described in
463. 140( d), including the criteria for
approval of a plan or application, if any,
under such law.
g) If the Secretary of Labor, the
Secretary of Education, or the
appropriate Secretary does not make the
written determination described in
paragraph (f) of this section within the
relevant period of time after submission
of the Combined State Plan, that portion
of the Combined State Plan over which
the Secretary has jurisdiction will be
considered approved.
h) The Secretaries of Labor and
Education' s written determination of
approval or disapproval regarding the
portion of the plan for the six core
programs may be separate from the
written determination of approval,
disapproval, or completeness of the
program -specific requirements of
Combined State Plan partner programs
and activities described in § 463. 140( d)
and included in the Combined State
Plan.
i) Special rule. In paragraphs (f)(1)
and (3) of this section, the term " criteria
for approval of a plan or application,"
with respect to a State or a core program
or a program under the Carl D. Perkins
Career and Technical Education Act of
2006 ( 20 U.S. C. 2301 et seq.), includes
a requirement for agreement between
the State and the appropriate Secretaries
regarding State performance measures
or State performance accountability
measures, as the case may be, including
levels of performance.
463. 145 What are the requirements for
modifications of the Combined State Plan?
a) For the core program portions of
the Combined State Plan, modifications
are required, at a minimum:
1) By the end of the first 2 -year
period of any 4 -year State Plan. The
State WDB must review the Combined
State Plan, and the Governor must
submit modifications to the Combined
State Plan to reflect changes in labor
market and economic conditions or
other factors affecting the
implementation of the Combined State
Plan;
2) When changes in Federal or State
law or policy substantially affect the
strategies, goals, and priorities upon
which the Combined State Plan is
based;
3) When there are changes in the
statewide vision, strategies, policies,
State negotiated levels of performance
as described in § 463.170(b), the
methodology used to determine local
allocation of funds, reorganizations that
change the working relationship with
system employees, changes in
organizational responsibilities, changes
to the membership structure of the State
WDB or alternative entity, and similar
substantial changes to the State' s
workforce development system.
b) In addition to the required
modification review described in
paragraph (a)( 1) of this section, a State
may submit a modification of its
Combined State Plan at any time during
the 4 -year period of the plan.
c) For any Combined State Plan
partner programs and activities
described in § 463. 140( d) that are
included in a State' s Combined State
Plan, the State—
1) May decide if the modification
requirements under WIOA sec. 102( c)( 3)
that apply to the core programs will
apply to the Combined State Plan
partner programs, as long as consistent
with any other modification
requirements for the programs, or may
comply with the requirements
applicable to only the particular
program or activity; and
2) Must submit, in accordance with
the procedure described in §463. 143,
any modification, amendment, or
revision required by the Federal law
authorizing, or applicable to, the
Combined State Plan partner program or
activity.
i) If the underlying programmatic
requirements change ( e.g., the
authorizing statute is reauthorized) for
Federal laws authorizing such programs,
a State must either modify its Combined
State Plan or submit a separate plan to
the appropriate Federal agency in
accordance with the new Federal law
authorizing the Combined State Plan
partner program or activity and other
legal requirements applicable to such
program or activity.
ii) If the modification, amendment, or
revision affects the administration of
only that particular Combined State
Plan partner program and has no impact
on the Combined State Plan as a whole
or the integration and administration of
the core and other Combined State Plan
partner programs at the State level,
modifications must be submitted for
approval to only the appropriate
Secretary, based on the approval
standards applicable to the original
Combined State Plan under § 463. 143, if
the State elects, or in accordance with
the procedures and requirements
applicable to the particular Combined
State Plan partner program.
3) A State also may amend its
Combined State Plan to add a Combined
State Plan partner program or activity
described in §463. 140( d).
d) Modifications of the Combined
State Plan are subject to the same public
review and comment requirements that
apply to the development of the original
Combined State Plan as described in
463. 143( c) except that, if the
modification, amendment, or revision
affects the administration of a particular
Combined State Plan partner program
and has no impact on the Combined
State Plan as a whole or the integration
and administration of the core and other
Combined State Plan partner programs
at the State level, a State may comply
instead with the procedures and
requirements applicable to the
particular Combined State Plan partner
program.
e) Modifications for the core program
portions of the Combined State Plan
must be approved by the Secretaries of
Labor and Education, based on the
approval standards applicable to the
original Combined State Plan under
463. 143. This approval must come
after the approval of the Commissioner
of the Rehabilitation Services
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Administration for modification of any
portion of the Combined State Plan
described in sec. 102(b)( 2)( D)(iii) of
WIOA.
10. Add subpart Ito part 463, as
added elsewhere in this issue of the
Federal Register, to read as follows:
Subpart I— Performance Accountability
Under Title I of the Workforce Innovation
and Opportunity Act
Sec.
463. 150 What definitions apply to
Workforce Innovation and Opportunity
Act performance accountability
provisions?
463. 155 What are the primary indicators of
performance under the Workforce
Innovation and Opportunity Act?
463. 160 What information is required for
State performance reports?
463. 165 May a State establish additional
indicators of performance?
463. 170 How are State levels of
performance for primary indicators
established?
463. 175 What responsibility do States have
to use quarterly wage record information
for performance accountability?
463. 180 When is a State subject to a
financial sanction under the Workforce
Innovation and Opportunity Act?
463. 185 When are sanctions applied for a
State' s failure to submit an annual
performance report?
463. 190 When are sanctions applied for
failure to achieve adjusted levels of
performance?
463. 195 What should States expect when a
sanction is applied to the Governor' s
Reserve Allotment?
463. 200 What other administrative actions
will be applied to States' performance
requirements?
463. 205 What performance indicators apply
to local areas and what information must
be included in local area performance
reports?
463. 210 How are local performance levels
established?
463. 215 Under what circumstances are
local areas eligible for State Incentive
Grants?
463. 220 Under what circumstances may a
corrective action or sanction be applied
to local areas for poor performance?
463. 225 Under what circumstances may
local areas appeal a reorganization plan?
463. 230 What information is required for
the eligible training provider
performance reports?
463. 235 What are the reporting
requirements for individual records for
core Workforce Innovation and
Opportunity Act (WIOA) title I programs;
the Wagner-Peyser Act Employment
Service program, as amended by WIOA
title III; and the Vocational
Rehabilitation program authorized under
title I of the Rehabilitation Act of 1973,
as amended by WIOA title IV?
463. 240 What are the requirements for data
validation of State annual performance
reports?
Authority: Secs. 116, 189, and 503 of Pub.
L. 113-128, 128 Stat. 1425 (Jul. 22, 2014).
Subpart I— Performance Accountability
Under Title I of the Workforce
Innovation and Opportunity Act
463. 150 What definitions apply to
Workforce Innovation and Opportunity Act
performance accountability provisions?
a) Participant. A reportable
individual who has received services
other than the services described in
paragraph (a)( 3) of this section, after
satisfying all applicable programmatic
requirements for the provision of
services, such as eligibility
determination.
1) For the Vocational Rehabilitation
VR) program, a participant is a
reportable individual who has an
approved and signed Individualized
Plan for Employment (IPE) and has
begun to receive services.
2) For the Workforce Innovation and
Opportunity Act (WIOA) title I youth
program, a participant is a reportable
individual who has satisfied all
applicable program requirements for the
provision of services, including
eligibility determination, an objective
assessment, and development of an
individual service strategy, and received
1 of the 14 WIOA youth program
elements identified in sec. 129( c)( 2) of
WIOA.
3) The following individuals are not
participants:
i) Individuals in an Adult Education
and Family Literacy Act (AEFLA)
program who have not completed at
least 12 contact hours;
ii) Individuals who only use the self-
service system.
A) Subject to paragraph ( a)( 3)( ii)(B) of
this section, self-service occurs when
individuals independently access any
workforce development system
program' s information and activities in
either a physical location, such as a one-
stop center resource room or partner
agency, or remotely via the use of
electronic technologies.
B) Self-service does not uniformly
apply to all virtually accessed services.
For example, virtually accessed services
that provide a level of support beyond
independent job or information seeking
on the part of an individual would not
qualify as self-service.
iii) Individuals who receive
information -only services or activities,
which provide readily available
information that does not require an
assessment by a staff member of the
individual' s skills, education, or career
objectives.
4) Programs must include
participants in their performance
calculations.
b) Reportable individual. An
individual who has taken action that
demonstrates an intent to use program
services and who meets specific
reporting criteria of the program,
including:
1) Individuals who provide
identifying information;
2) Individuals who only use the self-
service system; or
3) Individuals who only receive
information -only services or activities.
c) Exit. As defined for the purpose of
performance calculations, exit is the
point after which a participant who has
received services through any program
meets the following criteria:
1) For the adult, dislocated worker,
and youth programs authorized under
WIOA title I, the AEFLA program
authorized under WIOA title II, and the
Employment Service program
authorized under the Wagner-Peyser
Act, as amended by WIOA title III, exit
date is the last date of service.
i) The last day of service cannot be
determined until at least 90 days have
elapsed since the participant last
received services; services do not
include self-service, information -only
services or activities, or follow-up
services. This also requires that there
are no plans to provide the participant
with future services.
ii) [Reserved].
2)( i) For the VR program authorized
under title I of the Rehabilitation Act of
1973, as amended by WIOA title IV (VR
program):
A) The participant' s record of service
is closed in accordance with §463. 56
because the participant has achieved an
employment outcome; or
B) The participant' s service record is
closed because the individual has not
achieved an employment outcome or
the individual has been determined
ineligible after receiving services in
accordance with §463.43.
ii) Notwithstanding any other
provision of this section, a participant
will not be considered as meeting the
definition of exit from the VR program
if the participant' s service record is
closed because the participant has
achieved a supported employment
outcome in an integrated setting but not
in competitive integrated employment.
3)( i) A State may implement a
common exit policy for all or some of
the core programs in WIOA title I and
the Employment Service program
authorized under the Wagner-Peyser
Act, as amended by WIOA title III, and
any additional required partner
program(s) listed in sec. 121( b)( 1)( B) of
WIOA that is under the authority of the
U.S. Department of Labor (DOL).
ii) If a State chooses to implement a
common exit policy, the policy must
require that a participant is exited only
56052 Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
when all of the criteria in paragraph
c)( 1) of this section are met for the
WIOA title I core programs and the
Employment Service program
authorized under the Wagner-Peyser
Act, as amended by WIOA title III, as
well as any additional required partner
programs listed in sec. 121( b)( 1)( B) of
WIOA under the authority of DOL to
which the common exit policy applies
in which the participant is enrolled.
d) State. For purposes of this part,
other than in regard to sanctions or the
statistical adjustment model, all
references to " State" include the
outlying areas of American Samoa,
Guam, Commonwealth of the Northern
Mariana Islands, the U.S. Virgin Islands,
and, as applicable, the Republic of
Palau.
463. 155 What are the primary indicators
of performance under the Workforce
Innovation and Opportunity Act?
a) All States submitting either a
Unified or Combined State Plan under
463. 130 and 463. 143, must propose
expected levels of performance for each
of the primary indicators of performance
for the adult, dislocated worker, and
youth programs authorized under WIOA
title I; the AEFLA program authorized
under WIOA title II; the Employment
Service program authorized under the
Wagner-Peyser Act, as amended by
WIOA title III; and the VR program
authorized under title I of the
Rehabilitation Act of 1973, as amended
by WIOA title IV.
1) Primary indicators ofperformance.
The six primary indicators of
performance for the adult and
dislocated worker programs, the AEFLA
program, and the VR program are:
i) The percentage of participants who
are in unsubsidized employment during
the second quarter after exit from the
program;
ii) The percentage of participants
who are in unsubsidized employment
during the fourth quarter after exit from
the program;
iii) Median earnings of participants
who are in unsubsidized employment
during the second quarter after exit from
the program;
iv)(A) The percentage of those
participants enrolled in an education or
training program (excluding those in on-
the-job training [OJT] and customized
training) who attained a recognized
postsecondary credential or a secondary
school diploma, or its recognized
equivalent, during participation in or
within 1 year after exit from the
program.
B) A participant who has attained a
secondary school diploma or its
recognized equivalent is included in the
percentage of participants who have
attained a secondary school diploma or
recognized equivalent only if the
participant also is employed or is
enrolled in an education or training
program leading to a recognized
postsecondary credential within 1 year
after exit from the program;
v) The percentage of participants
who, during a program year, are in an
education or training program that leads
to a recognized postsecondary
credential or employment and who are
achieving measurable skill gains,
defined as documented academic,
technical, occupational, or other forms
of progress, towards such a credential or
employment. Depending upon the type
of education or training program,
documented progress is defined as one
of the following:
A) Documented achievement of at
least one educational functioning level
of a participant who is receiving
instruction below the postsecondary
education level;
B) Documented attainment of a
secondary school diploma or its
recognized equivalent;
C) Secondary or postsecondary
transcript or report card for a sufficient
number of credit hours that shows a
participant is meeting the State unit's
academic standards;
D) Satisfactory or better progress
report, towards established milestones,
such as completion of OJT or
completion of 1 year of an
apprenticeship program or similar
milestones, from an employer or
training provider who is providing
training; or
E) Successful passage of an exam that
is required for a particular occupation or
progress in attaining technical or
occupational skills as evidenced by
trade -related benchmarks such as
knowledge-based exams.
vi) Effectiveness in serving
employers.
2) Participants. For purposes of the
primary indicators of performance in
paragraph (a)( 1) of this section,
participant" will have the meaning
given to it in § 463. 150( a), except that—
i) For purposes of determining
program performance levels under
indicators set forth in paragraphs
a)( 1)( i) through (iv) and (vi) of this
section, a " participant" does not
include a participant who received
services under sec. 225 of WIOA and
exits such program while still in a
correctional institution as defined in
sec. 225( e)( 1) of WIOA; and
ii) The Secretaries of Labor and
Education may, as needed and
consistent with the Paperwork
Reduction Act (PRA), make further
determinations as to the participants to
be included in calculating program
performance levels for purposes of any
of the performance indicators set forth
in paragraph ( a)( 1) of this section.
b) The primary indicators in
paragraphs ( a)( 1)( i) through (iii) and (vi)
of this section apply to the Employment
Service program authorized under the
Wagner-Peyser Act, as amended by
WIOA title III.
c) For the youth program authorized
under WIOA title I, the primary
indicators are:
1) Percentage of participants who are
in education or training activities, or in
unsubsidized employment, during the
second quarter after exit from the
program;
2) Percentage of participants in
education or training activities, or in
unsubsidized employment, during the
fourth quarter after exit from the
program;
3) Median earnings of participants
who are in unsubsidized employment
during the second quarter after exit from
the program;
4) The percentage of those
participants enrolled in an education or
training program (excluding those in
OJT and customized training) who
obtained a recognized postsecondary
credential or a secondary school
diploma, or its recognized equivalent,
during participation in or within 1 year
after exit from the program, except that
a participant who has attained a
secondary school diploma or its
recognized equivalent is included as
having attained a secondary school
diploma or recognized equivalent only
if the participant is also employed or is
enrolled in an education or training
program leading to a recognized
postsecondary credential within 1 year
from program exit;
5) The percentage of participants
who during a program year, are in an
education or training program that leads
to a recognized postsecondary
credential or employment and who are
achieving measurable skill gains,
defined as documented academic,
technical, occupational or other forms of
progress towards such a credential or
employment. Depending upon the type
of education or training program,
documented progress is defined as one
of the following:
i) Documented achievement of at
least one educational functioning level
of a participant who is receiving
instruction below the postsecondary
education level;
ii) Documented attainment of a
secondary school diploma or its
recognized equivalent;
56053Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
iii) Secondary or postsecondary
transcript or report card for a sufficient
number of credit hours that shows a
participant is achieving the State unit' s
academic standards;
iv) Satisfactory or better progress
report, towards established milestones,
such as completion of OJT or
completion of 1 year of an
apprenticeship program or similar
milestones, from an employer or
training provider who is providing
training; or
v) Successful passage of an exam that
is required for a particular occupation or
progress in attaining technical or
occupational skills as evidenced by
trade -related benchmarks such as
knowledge-based exams.
6) Effectiveness in serving employers.
463. 160 What information is required for
State performance reports?
a) The State performance report
required by sec. 116( d)( 2) of WIOA must
be submitted annually using a template
the Departments of Labor and Education
will disseminate, and must provide, at
a minimum, information on the actual
performance levels achieved consistent
with §463. 175 with respect to:
1) The total number of participants
served, and the total number of
participants who exited each of the core
programs identified in sec.
116(b)( 3)( A)(ii) of WIOA, including
disaggregated counts of those who
participated in and exited a core
program, by:
i) Individuals with barriers to
employment as defined in WIOA sec.
3( 24); and
ii) Co -enrollment in any of the
programs in WIOA sec. 116( b)( 3)( A)(ii).
2) Information on the performance
levels achieved for the primary
indicators of performance for all of the
core programs identified in §463. 155
including disaggregated levels for:
i) Individuals with barriers to
employment as defined in WIOA sec.
3( 24);
ii) Age;
iii) Sex; and
iv) Race and ethnicity.
3) The total number of participants
who received career services and the
total number of participants who exited
from career services for the most recent
program year and the 3 preceding
program years, and the total number of
participants who received training
services and the total number of
participants who exited from training
services for the most recent program
year and the 3 preceding program years,
as applicable to the program;
4) Information on the performance
levels achieved for the primary
indicators of performance consistent
with §463. 155 for career services and
training services for the most recent
program year and the 3 preceding
program years, as applicable to the
program;
5) The percentage of participants in
a program who attained unsubsidized
employment related to the training
received (often referred to as training -
related employment) through WIOA
title I, subtitle B programs;
6) The amount of funds spent on
career services and the amount of funds
spent on training services for the most
recent program year and the 3 preceding
program years, as applicable to the
program;
7) The average cost per participant
for those participants who received
career services and training services,
respectively, during the most recent
program year and the 3 preceding
program years, as applicable to the
program;
8) The percentage of a State' s annual
allotment under WIOA sec. 132( b) that
the State spent on administrative costs;
and
9) Information that facilitates
comparisons of programs with programs
in other States.
10) For WIOA title I programs, a State
performance narrative, which, for States
in which a local area is implementing a
pay -for -performance contracting
strategy, at a minimum provides:
i) A description of pay -for -
performance contract strategies being
used for programs;
ii) The performance of service
providers entering into contracts for
such strategies, measured against the
levels of performance specified in the
contracts for such strategies; and
iii) An evaluation of the design of the
programs and performance strategies
and, when available, the satisfaction of
employers and participants who
received services under such strategies.
b) The disaggregation of data for the
State performance report must be done
in compliance with WIOA sec.
116( d)( 6)( C).
c) The State performance reports
must include a mechanism of electronic
access to the State' s local area and
eligible training provider (ETP)
performance reports.
d) States must comply with these
requirements from sec. 116 of WIOA as
explained in joint guidance issued by
the Departments of Labor and
Education, which may include
information on reportable individuals as
determined by the Secretaries of Labor
and Education.
463. 165 May a State establish additional
indicators of performance?
States may identify additional
indicators of performance for the six
core programs. If a State does so, these
indicators must he included in the
Unified or Combined State Plan.
463.170 How are State levels of
performance for primary indicators
established?
a) A State must submit in the State
Plan expected levels of performance on
the primary indicators of performance
for each core program as required by
sec. 116( b)( 3)( A)(iii) of WIOA as
explained in joint guidance issued by
the Secretaries of Labor and Education.
1) The initial State Plan submitted
under WIOA must contain expected
levels of performance for the first 2
years of the State Plan.
2) States must submit expected levels
of performance for the third and fourth
year of the State Plan before the third
program year consistent with §§463. 135
and 463. 145.
b) States must reach agreement on
levels of performance with the
Secretaries of Labor and Education for
each indicator for each core program.
These are the negotiated levels of
performance. The negotiated levels must
be based on the following factors:
1) How the negotiated levels of
performance compare with State levels
of performance established for other
States;
2) The application of an objective
statistical model established by the
Secretaries of Labor and Education,
subject to paragraph (d) of this section;
3) How the negotiated levels promote
continuous improvement in
performance based on the primary
indicators and ensure optimal return on
investment of Federal funds; and
4) The extent to which the negotiated
levels assist the State in meeting the
performance goals established by the
Secretaries of Labor and Education for
the core programs in accordance with
the Government Performance and
Results Act of 1993, as amended.
c) An objective statistical adjustment
model will be developed and
disseminated by the Secretaries of Labor
and Education. The model will be based
on:
1) Differences among States in actual
economic conditions, including but not
limited to unemployment rates and job
losses or gains in particular industries;
and
2) The characteristics of participants,
including but not limited to:
i) Indicators of poor work history;
ii) Lack of work experience;
iii) Lack of educational or
occupational skills attainment;
56054 Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
iv) Dislocation from high -wage and
high -benefit employment;
v) Low levels of literacy;
vi) Low levels of English proficiency;
vii) Disability status;
viii) Homelessness;
ix) Ex -offender status; and
x) Welfare dependency.
d) The objective statistical
adjustment model developed under
paragraph (c) of this section will be:
1) Applied to the core programs'
primary indicators upon availability of
data which are necessary to populate
the model and apply the model to the
local core programs;
2) Subject to paragraph (d)( 1) of this
section, used before the beginning of a
program year in order to reach
agreement on State negotiated levels for
the upcoming program year; and
3) Subject to paragraph (d)( 1) of this
section, used to revise negotiated levels
at the end of a program year based on
actual economic conditions and
characteristics of participants served,
consistent with sec. 116( b)( 3)( A)(vii) of
WIOA.
e) The negotiated levels revised at the
end of the program year, based on the
statistical adjustment model, are the
adjusted levels of performance.
f) States must comply with these
requirements from sec. 116 of WIOA as
explained in joint guidance issued by
the Departments of Labor and
Education.
463. 175 What responsibility do States
have to use quarterly wage record
information for performance
accountability?
a)( 1) States must, consistent with
State laws, use quarterly wage record
information in measuring a State' s
performance on the primary indicators
of performance outlined in §463. 155
and a local area' s performance on the
primary indicators of performance
identified in §463. 205.
2) The use of social security numbers
from participants and such other
information as is necessary to measure
the progress of those participants
through quarterly wage record
information is authorized.
3) To the extent that quarterly wage
records are not available for a
participant, States may use other
information as is necessary to measure
the progress of those participants
through methods other than quarterly
wage record information.
b) " Quarterly wage record
information" means intrastate and
interstate wages paid to an individual,
the social security number (or numbers,
if more than one) of the individual, and
the name, address, State, and the
Federal employer identification number
of the employer paying the wages to the
individual.
c) The Governor may designate a
State agency (or appropriate State
entity) to assist in carrying out the
performance reporting requirements for
WIOA core programs and ETPs. The
Governor or such agency ( or appropriate
State entity) is responsible for:
1) Facilitating data matches;
2) Data quality reliability; and
3) Protection against disaggregation
that would violate applicable privacy
standards.
463. 180 When is a State subject to a
financial sanction under the Workforce
Innovation and Opportunity Act?
A State will be subject to financial
sanction under WIOA sec. 116(f) if it
fails to:
a) Submit the State annual
performance report required under
WIOA sec. 116(d)(2); or
b) Meet adjusted levels of
performance for the primary indicators
of performance in accordance with sec.
116( f) of WIOA.
463. 185 When are sanctions applied for
a State' s failure to submit an annual
performance report?
a) Sanctions will be applied when a
State fails to submit the State annual
performance report required under sec.
116( d)( 2) of WIOA. A State fails to
report if the State either:
1) Does not submit a State annual
performance report by the date for
timely submission set in performance
reporting guidance; or
2) Submits a State annual
performance report by the date for
timely submission, but the report is
incomplete.
b) Sanctions will not be applied if the
reporting failure is due to exceptional
circumstances outside of the State' s
control. Exceptional circumstances may
include, but are not limited to:
1) Natural disasters;
2) Unexpected personnel transitions;
and
3) Unexpected technology related
issues.
c) In the event that a State may not
be able to submit a complete and
accurate performance report by the
deadline for timely reporting:
1) The State must notify the Secretary
of Labor or Secretary of Education as
soon as possible, but no later than 30
days prior to the established deadline
for submission, of a potential impact on
the State' s ability to submit its State
annual performance report in order to
not be considered failing to report.
2) In circumstances where
unexpected events occur less than 30
days before the established deadline for
submission of the State annual
performance reports, the Secretaries of
Labor and Education will review
requests for extending the reporting
deadline in accordance with the
Departments of Labor and Education' s
procedures that will be established in
guidance.
463.190 When are sanctions applied for
failure to achieve adjusted levels of
performance?
a) States' negotiated levels of
performance will be adjusted through
the application of the statistical
adjustment model established under
463. 170 to account for actual
economic conditions experienced
during a program year and
characteristics of participants, annually
at the close of each program year.
b) Any State that fails to meet
adjusted levels of performance for the
primary indicators of performance
outlined in § 463. 155 for any year will
receive technical assistance, including
assistance in the development of a
performance improvement plan
provided by the Secretary of Labor or
Secretary of Education.
c) Whether a State has failed to meet
adjusted levels of performance will be
determined using the following three
criteria:
1) The overall State program score,
which is expressed as the percent
achieved, compares the actual results
achieved by a core program on the
primary indicators of performance to the
adjusted levels of performance for that
core program. The average of the
percentages achieved of the adjusted
level of performance for each of the
primary indicators by a core program
will constitute the overall State program
score.
2) However, until all indicators for
the core program have at least 2 years
of complete data, the overall State
program score will be based on a
comparison of the actual results
achieved to the adjusted level of
performance for each of the primary
indicators that have at least 2 years of
complete data for that program;
3) The overall State indicator score,
which is expressed as the percent
achieved, compares the actual results
achieved on a primary indicator of
performance by all core programs in a
State to the adjusted levels of
performance for that primary indicator.
The average of the percentages achieved
of the adjusted level of performance by
all of the core programs on that
indicator will constitute the overall
State indicator score.
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4) However, until all indicators for
the State have at least 2 years of
complete data, the overall State
indicator score will be based on a
comparison of the actual results
achieved to the adjusted level of
performance for each of the primary
indicators that have at least 2 years of
complete data in a State.
5) The individual indicator score,
which is expressed as the percent
achieved, compares the actual results
achieved by each core program on each
of the individual primary indicators to
the adjusted levels of performance for
each of the program' s primary indicators
of performance.
d) A performance failure occurs
when:
1) Any overall State program score or
overall State indicator score falls below
90 percent for the program year; or
2) Any of the States' individual
indicator scores fall below 50 percent
for the program year.
e) Sanctions based on performance
failure will be applied to States if,for 2
consecutive years, the State fails to
meet:
1) 90 percent of the overall State
program score for the same core
program;
2) 90 percent of the overall State
indicator score for the same primary
indicator; or
3) 50 percent of the same indicator
score for the same program.
463. 195 What should States expect when
a sanction is applied to the Governor' s
Reserve Allotment?
a) The Secretaries of Labor and
Education will reduce the Governor' s
Reserve Allotment by five percent of the
maximum available amount for the
immediately succeeding program year
if:
1) The State fails to submit the State
annual performance reports as required
under WIOA sec. 116( d)( 2), as defined
in § 463. 185;
2) The State fails to meet State
adjusted levels of performance for the
same primary performance indicator(s)
under either § 463. 190( d)( 1) for the
second consecutive year as defined in
463. 190; or
3) The State' s score on the same
indicator for the same program falls
below 50 percent under § 463. 190( d)( 2)
for the second consecutive year as
defined in § 463. 190.
b) If the State fails under paragraphs
a)( 1) and either (a)( 2) or (3) of this
section in the same program year, the
Secretaries of Labor and Education will
reduce the Governor' s Reserve
Allotment by 10 percent of the
maximum available amount for the
immediately succeeding program year.
c) If a State' s Governor' s Reserve
Allotment is reduced:
1) The reduced amount will not be
returned to the State in the event that
the State later improves performance or
submits its annual performance report;
and
2) The Governor' s Reserve will
continue to be set at the reduced level
in each subsequent year until the
Secretary of Labor or the Secretary of
Education, depending on which
program is impacted, determines that
the State met the State adjusted levels
of performance for the applicable
primary performance indicators and has
submitted all of the required
performance reports.
d) A State may request review of a
sanction the Secretary of Labor imposes
in accordance with the provisions of 20
CFR 683. 800.
463. 200 What other administrative
actions will be applied to States'
performance requirements?
a) In addition to sanctions for failure
to report or failure to meet adjusted
levels of performance, States will be
subject to administrative actions in the
case of poor performance.
b) States' performance achievement
on the individual primary indicators
will be assessed in addition to the
overall State program score and overall
State indicator score. Based on this
assessment, as clarified and explained
in guidance, for performance on any
individual primary indicator, the
Secretary of Labor or the Secretary of
Education will require the State to
establish a performance risk plan to
address continuous improvement on the
individual primary indicator.
463. 205 What performance indicators
apply to local areas and what information
must be included in local area performance
reports?
a) Each local area in a State under
WIOA title I is subject to the same
primary indicators of performance for
the core programs for WIOA title I under
463. 155( a)( 1) and ( c) that apply to the
State.
b) In addition to the indicators
described in paragraph (a) of this
section, under § 463. 165, the Governor
may apply additional indicators of
performance to local areas in the State.
c) States must annually make local
area performance reports available to
the public using a template that the
Departments of Labor and Education
will disseminate in guidance, including
by electronic means. The State must
provide electronic access to the public
local area performance report in its
annual State performance report.
d) The local area performance report
must include:
1) The actual results achieved under
463. 155 and the information required
under § 463. 160( a);
2) The percentage of a local area' s
allotment under WIOA secs. 128(b) and
133(b) that the local area spent on
administrative costs; and
3) Other information that facilitates
comparisons of programs with programs
in other local areas ( or planning regions
if the local area is part of a planning
region).
e) The disaggregation of data for the
local area performance report must be
done in compliance with WIOA sec.
116( d)( 6)( C).
f) States must comply with any
requirements from sec. 116(d)( 3) of
WIOA as explained in guidance,
including the use of the performance
reporting template, issued by DOL.
463.210 How are local performance
levels established?
a) The objective statistical adjustment
model required under sec.
116( b)( 3)( A)(viii) of WIOA and
described in §463. 170( c) must be:
1) Applied to the core programs'
primary indicators upon availability of
data which are necessary to populate
the model and apply the model to the
local core programs;
2) Used in order to reach agreement
on local negotiated levels of
performance for the upcoming program
year; and
3) Used to establish adjusted levels of
performance at the end of a program
year based on actual conditions,
consistent with WIOA sec. 116( c)( 3).
b) Until all indicators for the core
program in a local area have at least 2
years of complete data, the comparison
of the actual results achieved to the
adjusted levels of performance for each
of the primary indicators only will be
applied where there are at least 2 years
of complete data for that program.
c) The Governor, Local Workforce
Development Board (WDB), and chief
elected official must reach agreement on
local negotiated levels of performance
based on a negotiations process before
the start of a program year with the use
of the objective statistical model
described in paragraph (a) of this
section. The negotiations will include a
discussion of circumstances not
accounted for in the model and will take
into account the extent to which the
levels promote continuous
improvement. The objective statistical
model will be applied at the end of the
program year based on actual economic
conditions and characteristics of the
participants served.
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d) The negotiations process described
in paragraph (c) of this section must be
developed by the Governor and
disseminated to all Local WDBs and
chief elected officials.
e) The Local WDBs may apply
performance measures to service
providers that differ from the
performance indicators that apply to the
local area. These performance measures
must be established after considering:
1) The established local negotiated
levels;
2) The services provided by each
provider; and
3) The populations the service
providers are intended to serve.
463.215 Under what circumstances are
local areas eligible for State Incentive
Grants?
a) The Governor is not required to
award local incentive funds, but is
authorized to provide incentive grants
to local areas for performance on the
primary indicators of performance
consistent with WIOA sec.
134( a)( 3)( A)(xi).
b) The Governor may use non -
Federal funds to create incentives for
the Local WDBs to implement pay -for -
performance contract strategies for the
delivery of training services described
in WIOA sec. 134( c)( 3) or activities
described in WIOA sec. 129( c)( 2) in the
local areas served by the Local WDBs.
Pay -for -performance contract strategies
must be implemented in accordance
with 20 CFR part 683, subpart E and
463. 160.
463.220 Under what circumstances may
a corrective action or sanction be applied
to local areas for poor performance?
a) If a local area fails to meet the
adjusted levels of performance agreed to
under § 463. 210 for the primary
indicators of performance in the adult,
dislocated worker, and youth programs
authorized under WIOA title I in any
program year, technical assistance must
be provided by the Governor or, upon
the Governor' s request, by the Secretary
of Labor.
1) A State must establish the
threshold for failure to meet adjusted
levels of performance for a local area
before coming to agreement on the
negotiated levels of performance for the
local area.
i) A State must establish the adjusted
level of performance for a local area,
using the statistical adjustment model
described in §463. 170( c).
ii) At least 2 years of complete data
on any indicator for any local core
program are required in order to
establish adjusted levels of performance
for a local area.
2) The technical assistance may
include:
i) Assistance in the development of a
performance improvement plan;
ii) The development of a modified
local or regional plan; or
iii) Other actions designed to assist
the local area in improving
performance.
b) If a local area fails to meet the
adjusted levels of performance agreed to
under § 463. 210 for the same primary
indicators of performance for the same
core program authorized under WIOA
title I for a third consecutive program
year, the Governor must take corrective
actions. The corrective actions must
include the development of a
reorganization plan under which the
Governor:
1) Requires the appointment and
certification of a new Local WDB,
consistent with the criteria established
under 20 CFR 679. 350;
2) Prohibits the use of eligible
providers and one-stop partners that
have been identified as achieving poor
levels of performance; or
3) Takes such other significant
actions as the Governor determines are
appropriate.
463. 225 Under what circumstances may
local areas appeal a reorganization plan?
a) The Local WDB and chief elected
official for a local area that is subject to
a reorganization plan under WIOA sec.
116( g)( 2)( A) may appeal to the Governor
to rescind or revise the reorganization
plan not later than 30 days after
receiving notice of the reorganization
plan. The Governor must make a final
decision within 30 days after receipt of
the appeal.
b) The Local WDB and chief elected
official may appeal the final decision of
the Governor to the Secretary of Labor
not later than 30 days after receiving the
decision from the Governor. Any appeal
of the Governor' s final decision must be:
1) Appealed jointly by the Local
WDB and chief elected official to the
Secretary of Labor under 20 CFR
683. 650; and
2) Must be submitted by certified
mail, return receipt requested, to the
Secretary of Labor, U.S. Department of
Labor, 200 Constitution Ave. NW.,
Washington DC 20210, Attention: ASET.
A copy of the appeal must be
simultaneously provided to the
Governor.
c) Upon receipt of the joint appeal
from the Local WDB and chief elected
official, the Secretary of Labor must
make a final decision within 30 days. In
making this determination the Secretary
of Labor may consider any comments
submitted by the Governor in response
to the appeals.
d) The decision by the Governor on
the appeal becomes effective at the time
it is issued and remains effective unless
the Secretary of Labor rescinds or
revises the reorganization plan under
WIOA sec. 116( g)( 2)( C).
463.230 What information is required for
the eligible training provider performance
reports?
a) States are required to make
available and publish annually using a
template the Departments of Labor and
Education will disseminate including
through electronic means, the ETP
performance reports for ETPs who
provide services under sec. 122 of
WIOA that are described in 20 CFR
680. 400 through 680. 530. These reports
at a minimum must include, consistent
with §463. 175 and with respect to each
program of study that is eligible to
receive funds under WIOA:
1) The total number of participants as
defined by § 463. 150( a) who received
training services under the adult and
dislocated worker programs authorized
under WIOA title I for the most recent
year and the 3 preceding program years,
including:
i) The number of participants under
the adult and dislocated worker
programs disaggregated by barriers to
employment;
ii) The number of participants under
the adult and dislocated worker
programs disaggregated by race,
ethnicity, sex, and age;
iii) The number of participants under
the adult and dislocated worker
programs disaggregated by the type of
training entity for the most recent
program year and the 3 preceding
program years;
2) The total number of participants
who exit a program of study or its
equivalent, including disaggregate
counts by the type of training entity
during the most recent program year
and the 3 preceding program years;
3) The average cost -per -participant
for participants who received training
services for the most recent program
year and the 3 preceding program years
disaggregated by type of training entity;
4) The total number of individuals
exiting from the program of study (or
the equivalent) with respect to all
individuals engaging in the program of
study (or the equivalent); and
5) The levels of performance
achieved for the primary indicators of
performance identified in
463. 155( a)( 1)( i) through (iv) with
respect to all individuals engaging in a
program of study (or the equivalent).
b) Apprenticeship programs
registered under the National
Apprenticeship Act are not required to
56057Federal Register / Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
submit ETP performance information. If
a registered apprenticeship program
voluntarily submits performance
information to a State, the State must
include this information in the report.
c) The State must provide a
mechanism of electronic access to the
public ETP performance report in its
annual State performance report.
d) States must comply with any
requirements from sec. 116(d)(4) of
WIOA as explained in guidance issued
by DOL.
e) The Governor may designate one
or more State agencies such as a State
Education Agency or other State
Educational Authority to assist in
overseeing ETP performance and
facilitating the production and
dissemination of ETP performance
reports. These agencies may be the same
agencies that are designated as
responsible for administering the ETP
list as provided under 20 CFR 680. 500.
The Governor or such agencies, or
authorities, is responsible for:
1) Facilitating data matches between
ETP records and unemployment
insurance ( UI) wage data in order to
produce the report;
2) The creation and dissemination of
the reports as described in paragraphs
a) through (d) of this section;
3) Coordinating the dissemination of
the performance reports with the ETP
list and the information required to
accompany the list, as provided in 20
CFR 680. 500.
463.235 What are the reporting
requirements for individual records for core
Workforce Innovation and Opportunity Act
WIOA) title I programs; the Wagner-Peyser
Act Employment Service program, as
amended by WIOA title III; and the
Vocational Rehabilitation program
authorized under title I of the Rehabilitation
Act of 1973, as amended by WIOA title IV?
a) On a quarterly basis, each State
must submit to the Secretary of Labor or
the Secretary of Education, as
appropriate, individual records that
include demographic information,
information on services received, and
information on resulting outcomes, as
appropriate, for each reportable
individual in either of the following
programs administered by the Secretary
of Labor or Secretary of Education: A
WIOA title I core program; the
Employment Service program
authorized under the Wagner-Peyser
Act, as amended by WIOA title III; or
the VR program authorized under title I
of the Rehabilitation Act of 1973, as
amended by WIOA title IV.
b) For individual records submitted
to the Secretary of Labor, those records
may be required to be integrated across
all programs administered by the
Secretary of Labor in one single file.
c) States must comply with the
requirements of sec. 116( d)( 2) of WIOA
as explained in guidance issued by the
Departments of Labor and Education.
463. 240 What are the requirements for
data validation of State annual performance
reports?
a) States must establish procedures,
consistent with guidelines issued by the
Secretary of Labor or the Secretary of
Education, to ensure that they submit
complete annual performance reports
that contain information that is valid
and reliable, as required by WIOA sec.
116( d)( 5).
b) If a State fails to meet standards in
paragraph (a) of this section as
determined by the Secretary of Labor or
the Secretary of Education, the
appropriate Secretary will provide
technical assistance and may require the
State to develop and implement
corrective actions, which may require
the State to provide training for its
subrecipients.
c) The Secretaries of Labor and
Education will provide training and
technical assistance to States in order to
implement this section. States must
comply with the requirements of sec.
116( d)( 5) of WIOA as explained in
guidance.
11. Add subpart J to part 463, as
added elsewhere in this issue of the
Federal Register, to read as follows:
Subpart J -Description of the One -Stop
Delivery System Under Title I of the
Workforce Innovation and Opportunity Act
Sec.
463. 300 What is the one-stop delivery
system?
463. 305 What is a comprehensive one-stop
center and what must be provided there?
463. 310 What is an affiliated site and what
must be provided there?
463. 315 Can a stand-alone Wagner-Peyser
Act Employment Service office be
designated as an affiliated one-stop site?
463. 320 Are there any requirements for
networks of eligible one-stop partners or
specialized centers?
463.400 Who are the required one-stop
partners?
463. 405 Is Temporary Assistance for Needy
Families a required one-stop partner?
463. 410 What other entities may serve as
one-stop partners?
463. 415 What entity serves as the one-stop
partner for a particular program in the
local area?
463. 420 What are the roles and
responsibilities of the required one-stop
partners?
463. 425 What are the applicable career
services that must be provided through
the one-stop delivery system by required
one-stop partners?
463. 430 What are career services?
463.435 What are the business services
provided through the one-stop delivery
system, and how are they provided?
463.440 When may a fee be charged for the
business services in this subpart?
463. 500 What is the Memorandum of
Understanding for the one-stop delivery
system and what must be included in the
Memorandum of Understanding?
463.505 Is there a single Memorandum of
Understanding for the local area, or must
there be different Memoranda of
Understanding between the Local
Workforce Development Board and each
partner?
463. 510 How must the Memorandum of
Understanding be negotiated?
463. 600 Who may operate one-stop centers?
463. 605 How is the one-stop operator
selected?
463. 610 When is the sole -source selection
of one-stop operators appropriate, and
how is it conducted?
463. 615 May an entity currently serving as
one-stop operator compete to be a one-
stop operator under the procurement
requirements of this subpart?
463. 620 What is the one-stop operator' s
role?
463. 625 Can a one-stop operator also be a
service provider?
463.630 Can State merit staff still work in
a one-stop center where the operator is
not a governmental entity?
463. 635 What is the compliance date of the
provisions of this subpart?
463. 700 What are the one-stop
infrastructure costs?
463. 705 What guidance must the Governor
issue regarding one-stop infrastructure
funding?
463. 710 How are infrastructure costs
funded?
463. 715 How are one-stop infrastructure
costs funded in the local funding
mechanism?
463. 720 What funds are used to pay for
infrastructure costs in the local one-stop
infrastructure funding mechanism?
463. 725 What happens if consensus on
infrastructure funding is not reached at
the local level between the Local
Workforce Development Board, chief
elected officials, and one-stop partners?
463. 730 What is the State one-stop
infrastructure funding mechanism?
463. 731 What are the steps to determine the
amount to be paid under the State one-
stop infrastructure funding mechanism?
463. 735 How are infrastructure cost budgets
for the one-stop centers in a local area
determined in the State one-stop
infrastructure funding mechanism?
463. 736 How does the Governor establish a
cost allocation methodology used to
determine the one-stop partner
programs' proportionate shares of
infrastructure costs under the State one-
stop infrastructure funding mechanism?
463. 737 How are one-stop partner
programs' proportionate shares of
infrastructure costs determined under
the State one-stop infrastructure funding
mechanism?
463. 738 How are statewide caps on the
contributions for one-stop infrastructure
56058 Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
funding determined in the State one-stop
infrastructure funding mechanism?
463. 740 What funds are used to pay for
infrastructure costs in the State one-stop
infrastructure funding mechanism?
463. 745 What factors does the State
Workforce Development Board use to
develop the formula described in
Workforce Innovation and Opportunity
Act, which is used by the Governor to
determine the appropriate one-stop
infrastructure budget for each local area
operating under the State infrastructure
funding mechanism, if no reasonably
implementable locally negotiated budget
exists?
463. 750 When and how can a one-stop
partner appeal a one-stop infrastructure
amount designated by the State under
the State infrastructure funding
mechanism?
463. 755 What are the required elements
regarding infrastructure funding that
must be included in the one-stop
Memorandum of Understanding?
463.760 How do one-stop partners jointly
fund other shared costs under the
Memorandum of Understanding?
463. 800 How are one-stop centers and one-
stop delivery systems certified for
effectiveness, physical and programmatic
accessibility, and continuous
improvement?
463. 900 What is the common identifier to
be used by each one-stop delivery
system?
Authority: Secs. 503, 107, 121, 134, 189,
Pub. L. 113- 128, 128 Stat. 1425 (Jul. 22,
2014).
Subpart J— Description of the One -
Stop Delivery System Under Title I of
the Workforce Innovation and
Opportunity Act
463.300 What is the one-stop delivery
system?
a) The one-stop delivery system
brings together workforce development,
educational, and other human resource
services in a seamless customer -focused
service delivery network that enhances
access to the programs' services and
improves long-term employment
outcomes for individuals receiving
assistance. One-stop partners administer
separately funded programs as a set of
integrated streamlined services to
customers.
b) Title I of the Workforce Innovation
and Opportunity Act (WIOA) assigns
responsibilities at the local, State, and
Federal level to ensure the creation and
maintenance of a one-stop delivery
system that enhances the range and
quality of education and workforce
development services that employers
and individual customers can access.
c) The system must include at least
one comprehensive physical center in
each local area as described in
463. 305.
d) The system may also have
additional arrangements to supplement
the comprehensive center. These
arrangements include:
1) An affiliated site or a network of
affiliated sites, where one or more
partners make programs, services, and
activities available, as described in
463. 310;
2) A network of eligible one-stop
partners, as described in §§ 463. 400
through 463. 410, through which each
partner provides one or more of the
programs, services, and activities that
are linked, physically or
technologically, to an affiliated site or
access point that assures customers are
provided information on the availability
of career services, as well as other
program services and activities,
regardless of where they initially enter
the public workforce system in the local
area; and
3) Specialized centers that address
specific needs, including those of
dislocated workers, youth, or key
industry sectors, or clusters.
e) Required one-stop partner
programs must provide access to
programs, services, and activities
through electronic means if applicable
and practicable. This is in addition to
providing access to services through the
mandatory comprehensive physical one-
stop center and any affiliated sites or
specialized centers. The provision of
programs and services by electronic
methods such as Web sites, telephones,
or other means must improve the
efficiency, coordination, and quality of
one-stop partner services. Electronic
delivery must not replace access to such
services at a comprehensive one-stop
center or be a substitute to making
services available at an affiliated site if
the partner is participating in an
affiliated site. Electronic delivery
systems must be in compliance with the
nondiscrimination and equal
opportunity provisions of WIOA sec.
188 and its implementing regulations at
29 CFR part 38.
f) The design of the local area' s one-
stop delivery system must be described
in the Memorandum of Understanding
MOU) executed with the one-stop
partners, described in §463. 500.
463. 305 What is a comprehensive one-
stop center and what must be provided
there?
a) A comprehensive one-stop center
is a physical location where job seeker
and employer customers can access the
programs, services, and activities of all
required one-stop partners. A
comprehensive one-stop center must
have at least one title I staff person
physically present.
b) The comprehensive one-stop
center must provide:
1) Career services, described in
463. 430;
2) Access to training services
described in 20 CFR 680. 200;
3) Access to any employment and
training activities carried out under sec.
134(d) of WIOA;
4) Access to programs and activities
carried out by one-stop partners listed
in §§463.400 through 463.410,
including the Employment Service
program authorized under the Wagner-
Peyser Act, as amended by WIOA title
III (Wagner-Peyser Act Employment
Service program); and
5) Workforce and labor market
information.
c) Customers must have access to
these programs, services, and activities
during regular business days at a
comprehensive one-stop center. The
Local Workforce Development Board
WDB) may establish other service hours
at other times to accommodate the
schedules of individuals who work on
regular business days. The State WDB
will evaluate the hours of access to
service as part of the evaluation of
effectiveness in the one-stop
certification process described in
463. 800(b).
d) " Access" to each partner program
and its services means:
1) Having a program staff member
physically present at the one-stop
center;
2) Having a staff member from a
different partner program physically
present at the one-stop center
appropriately trained to provide
information to customers about the
programs, services, and activities
available through partner programs; or
3) Making available a direct linkage
through technology to program staff
who can provide meaningful
information or services.
i) A " direct linkage" means
providing direct connection at the one-
stop center, within a reasonable time, by
phone or through a real-time Web -based
communication to a program staff
member who can provide program
information or services to the customer.
ii) A " direct linkage" cannot
exclusively be providing a phone
number or computer Web site or
providing information, pamphlets, or
materials.
e) All comprehensive one-stop
centers must be physically and
programmatically accessible to
individuals with disabilities, as
described in 29 CFR part 38, the
implementing regulations of WIOA sec.
188.
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463.310 What is an affiliated site and
what must be provided there?
a) An affiliated site, or affiliate one-
stop center, is a site that makes available
to job seeker and employer customers
one or more of the one-stop partners'
programs, services, and activities. An
affiliated site does not need to provide
access to every required one-stop
partner program. The frequency of
program staff's physical presence in the
affiliated site will be determined at the
local level. Affiliated sites are access
points in addition to the comprehensive
one-stop center(s) in each local area. If
used by local areas as a part of the
service delivery strategy, affiliate sites
must be implemented in a manner that
supplements and enhances customer
access to services.
b) As described in §463. 315, Wagner-
Peyser Act employment services cannot
be a stand-alone affiliated site.
c) States, in conjunction with the
Local WDBs, must examine lease
agreements and property holdings
throughout the one-stop delivery system
in order to use property in an efficient
and effective way. Where necessary and
appropriate, States and Local WDBs
must take expeditious steps to align
lease expiration dates with efforts to
consolidate one-stop operations into
service points where Wagner-Peyser Act
employment services are colocated as
soon as reasonably possible. These steps
must he included in the State Plan.
d) All affiliated sites must be
physically and programmatically
accessible to individuals with
disabilities, as described in 29 CFR part
38, the implementing regulations of
WIOA sec. 188.
463.315 Can a stand-alone Wagner-
Peyser Act Employment Service office be
designated as an affiliated one-stop site?
a) Separate stand-alone Wagner-
Peyser Act Employment Service offices
are not permitted under WIOA, as also
described in 20 CFR 652. 202.
b) If Wagner-Peyser Act employment
services are provided at an affiliated
site, there must be at least one or more
other partners in the affiliated site with
a physical presence of combined staff
more than 50 percent of the time the
center is open. Additionally, the other
partner must not be the partner
administering local veterans'
employment representatives, disabled
veterans' outreach program specialists,
or unemployment compensation
programs. If Wagner-Peyser Act
employment services and any of these 3
programs are provided at an affiliated
site, an additional partner or partners
must have a presence of combined staff
in the center more than 50 percent of
the time the center is open.
463. 320 Are there any requirements for
networks of eligible one-stop partners or
specialized centers?
Any network of one-stop partners or
specialized centers, as described in
463. 300( d)( 3), must be connected to
the comprehensive one-stop center and
any appropriate affiliate one-stop
centers, for example, by having
processes in place to make referrals to
these centers and the partner programs
located in them. Wagner-Peyser Act
employment services cannot stand alone
in a specialized center. Just as described
in § 463. 315 for an affiliated site, a
specialized center must include other
programs besides Wagner-Peyser Act
employment services, local veterans'
employment representatives, disabled
veterans' outreach program specialists,
and unemployment compensation.
463.400 Who are the required one-stop
partners?
a) Section 121( b)( 1)( B) of WIOA
identifies the entities that are required
partners in the local one-stop delivery
systems.
b) The required partners are the
entities responsible for administering
the following programs and activities in
the local area:
1) Programs authorized under title I
of WIOA, including:
i) Adults;
ii) Dislocated workers;
iii)Youth;
iv) Job Corps;
v) YouthBuild;
vi) Native American programs; and
vii) Migrant and seasonal farmworker
programs;
2) The Wagner-Peyser Act
Employment Service program
authorized under the Wagner-Peyser Act
29 U.S. C. 49 et seq.), as amended by
WIOA title III;
3) The Adult Education and Family
Literacy Act (AEFLA) program
authorized under title II of WIOA;
4) The Vocational Rehabilitation (VR)
program authorized under title I of the
Rehabilitation Act of 1973 ( 29 U.S. C.
720 et seq.), as amended by WIOA title
IV;
5) The Senior Community Service
Employment Program authorized under
title V of the Older Americans Act of
1965 ( 42 U.S. C. 3056 et seq.);
6) Career and technical education
programs at the postsecondary level
authorized under the Carl D. Perkins
Career and Technical Education Act of
2006 ( 20 U.S. C. 2301 et seq.);
7) Trade Adjustment Assistance
activities authorized under chapter 2 of
title II of the Trade Act of 1974 ( 19
U.S. C. 2271 et seq.);
8) Jobs for Veterans State Grants
programs authorized under chapter 41
of title 38, U.S. C.;
9) Employment and training
activities carried out under the
Community Services Block Grant (42
U.S. C. 9901 et seq.);
10) Employment and training
activities carried out by the Department
of Housing and Urban Development;
11) Programs authorized under State
unemployment compensation laws (in
accordance with applicable Federal
law);
12) Programs authorized under sec.
212 of the Second Chance Act of 2007
42 U.S. C. 17532); and
13) Temporary Assistance for Needy
Families (TANF) authorized under part
A of title IV of the Social Security Act
42 U.S. C. 601 et seq.), unless exempted
by the Governor under § 463. 405( b).
463.405 Is Temporary Assistance for
Needy Families a required one-stop
partner?
a) Yes, TANF, authorized under part
A of title IV of the Social Security Act
42 U. S. C. 601 et seq.), is a required
partner.
b) The Governor may determine that
TANF will not be a required partner in
the State, or within some specific local
areas in the State. In this instance, the
Governor must notify the Secretaries of
the U.S. Departments of Labor and
Health and Human Services in writing
of this determination.
c) In States, or local areas within a
State, where the Governor has
determined that TANF is not required to
be a partner, local TANF programs may
still work in collaboration or
partnership with the local one-stop
centers to deliver employment and
training services to the TANF
population unless inconsistent with the
Governor' s direction.
463.410 What other entities may serve as
one-stop partners?
a) Other entities that carry out a
workforce development program,
including Federal, State, or local
programs and programs in the private
sector, may serve as additional partners
in the one-stop delivery system if the
Local WDB and chief elected official(s)
approve the entity' s participation.
b) Additional partners may include,
but are not limited to:
1) Employment and training
programs administered by the Social
Security Administration, including the
Ticket to Work and Self -Sufficiency
Program established under sec. 1148 of
the Social Security Act (42 U.S. C.
1320b-19);
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2) Employment and training
programs carried out by the Small
Business Administration;
3) Supplemental Nutrition Assistance
Program ( SNAP) employment and
training programs, authorized under
secs. 6( d)( 4) and 6( o) of the Food and
Nutrition Act of 2008 ( 7 U. S. C.
2015( d)(4));
4) Client Assistance Program
authorized under sec. 112 of the
Rehabilitation Act of 1973 ( 29 U.S. C.
732);
5) Programs authorized under the
National and Community Service Act of
1990 ( 42 U.S. C. 12501 et seq.); and
6) Other appropriate Federal, State or
local programs, including, but not
limited to, employment, education, and
training programs provided by public
libraries or in the private sector.
463.415 What entity serves as the one-
stop partner for a particular program in the
local area?
a) The entity that carries out the
program and activities listed in
463. 400 or § 463. 410, and therefore
serves as the one-stop partner, is the
grant recipient, administrative entity, or
organization responsible for
administering the funds of the specified
program in the local area. The term
entity" does not include the service
providers that contract with, or are
subrecipients of, the local
administrative entity. For programs that
do not include local administrative
entities, the responsible State agency
must be the partner. Specific entities for
particular programs are identified in
paragraphs (b) through (e) of this
section. If a program or activity listed in
463. 400 is not carried out in a local
area, the requirements relating to a
required one-stop partner are not
applicable to such program or activity in
that local one-stop delivery system.
b) For title II of WIOA, the entity or
agency that carries out the program for
the purposes of paragraph (a) of this
section is the sole entity or agency in
the State or outlying area responsible for
administering or supervising policy for
adult education and literacy activities in
the State or outlying area. The State
eligible entity or agency may delegate its
responsibilities under paragraph (a) of
this section to one or more eligible
providers or consortium of eligible
providers.
c) For the VR program, authorized
under title I of the Rehabilitation Act of
1973, as amended by WIOA title IV, the
entity that carries out the program for
the purposes of paragraph (a) of this
section is the designated State agencies
or designated State units specified
under sec. 101( a)( 2) of the
Rehabilitation Act that is primarily
concerned with vocational
rehabilitation, or vocational and other
rehabilitation, of individuals with
disabilities.
d) Under WIOA title I, the national
programs, including Job Corps, the
Native American program, YouthBuild,
and Migrant and Seasonal Farmworker
programs are required one-stop partners.
The entity for the Native American
program, YouthBuild, and Migrant and
Seasonal Farmworker programs is the
grantee of those respective programs.
The entity for Job Corps is the Job Corps
center.
e) For the Carl D. Perkins Career and
Technical Education Act of 2006, the
entity that carries out the program for
the purposes of paragraph (a) of this
section is the eligible recipient or
recipients at the postsecondary level, or
a consortium of eligible recipients at the
postsecondary level in the local area.
The eligible recipient at the
postsecondary level may also request
assistance from the State eligible agency
in completing its responsibilities under
paragraph (a) of this section.
463. 420 What are the roles and
responsibilities of the required one-stop
partners?
Each required partner must:
a) Provide access to its programs or
activities through the one-stop delivery
system, in addition to any other
appropriate locations;
b) Use a portion of funds made
available to the partner' s program, to the
extent consistent with the Federal law
authorizing the partner' s program and
with Federal cost principles in 2 CFR
parts 200 and 3474 (requiring, among
other things, that costs are allowable,
reasonable, necessary, and allocable), to:
1) Provide applicable career services;
and
2) Work collaboratively with the
State and Local WDBs to establish and
maintain the one-stop delivery system.
This includes jointly funding the one-
stop infrastructure through partner
contributions that are based upon:
i) A reasonable cost allocation
methodology by which infrastructure
costs are charged to each partner based
on proportionate use and relative
benefit received;
ii) Federal cost principles; and
iii) Any local administrative cost
requirements in the Federal law
authorizing the partner' s program. (This
is further described in §463. 700.)
c) Enter into an MOU with the Local
WDB relating to the operation of the
one-stop delivery system that meets the
requirements of §463. 500(b);
d) Participate in the operation of the
one-stop delivery system consistent
with the terms of the MOU,
requirements of authorizing laws, the
Federal cost principles, and all other
applicable legal requirements; and
e) Provide representation on the State
and Local WDBs as required and
participate in Board committees as
needed.
463.425 What are the applicable career
services that must be provided through the
one-stop delivery system by required one-
stop partners?
a) The applicable career services to
be delivered by required one-stop
partners are those services listed in
463. 430 that are authorized to be
provided under each partner' s program.
b) One-stop centers provide services
to individual customers based on
individual needs, including the
seamless delivery of multiple services to
individual customers. There is no
required sequence of services.
463.430 What are career services?
Career services, as identified in sec.
134( c)( 2) of WIOA, consist of three
types:
a) Basic career services must be made
available and, at a minimum, must
include the following services, as
consistent with allowable program
activities and Federal cost principles:
1) Determinations of whether the
individual is eligible to receive
assistance from the adult, dislocated
worker, or youth programs;
2) Outreach, intake (including worker
profiling), and orientation to
information and other services available
through the one-stop delivery system.
For the TANF program, States must
provide individuals with the
opportunity to initiate an application for
TANF assistance and non -assistance
benefits and services, which could be
implemented through the provision of
paper application forms or links to the
application Web site;
3) Initial assessment of skill levels
including literacy, numeracy, and
English language proficiency, as well as
aptitudes, abilities (including skills
gaps), and supportive services needs;
4) Labor exchange services,
including—
i) Job search and placement
assistance, and, when needed by an
individual, career counseling,
including—
A) Provision of information on in -
demand industry sectors and
occupations ( as defined in sec. 3( 23) of
WIOA); and
B) Provision of information on
nontraditional employment; and
ii) Appropriate recruitment and other
business services on behalf of
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employers, including information and
referrals to specialized business services
other than those traditionally offered
through the one-stop delivery system;
5) Provision of referrals to and
coordination of activities with other
programs and services, including
programs and services within the one-
stop delivery system and, when
appropriate, other workforce
development programs;
6) Provision of workforce and labor
market employment statistics
information, including the provision of
accurate information relating to local,
regional, and national labor market
areas, including—
i) Job vacancy listings in labor market
areas;
ii) Information on job skills necessary
to obtain the vacant jobs listed; and
iii) Information relating to local
occupations in demand and the
earnings, skill requirements, and
opportunities for advancement for those
jobs;
7) Provision of performance
information and program cost
information on eligible providers of
education, training, and workforce
services by program and type of
providers;
8) Provision of information, in usable
and understandable formats and
languages, about how the local area is
performing on local performance
accountability measures, as well as any
additional performance information
relating to the area' s one-stop delivery
system;
9) Provision of information, in usable
and understandable formats and
languages, relating to the availability of
supportive services or assistance, and
appropriate referrals to those services
and assistance, including: Child care;
child support; medical or child health
assistance available through the State' s
Medicaid program and Children' s
Health Insurance Program; benefits
under SNAP; assistance through the
earned income tax credit; and assistance
under a State program for TANF, and
other supportive services and
transportation provided through that
program;
10) Provision of information and
meaningful assistance to individuals
seeking assistance in filing a claim for
unemployment compensation.
i) "Meaningful assistance" means:
A) Providing assistance on-site using
staff who are well-trained in
unemployment compensation claims
filing and the rights and responsibilities
of claimants; or
B) Providing assistance by phone or
via other technology, as long as the
assistance is provided by trained and
available staff and within a reasonable
time.
ii) The costs associated in providing
this assistance may be paid for by the
State' s unemployment insurance
program, or the WIOA adult or
dislocated worker programs, or some
combination thereof.
11) Assistance in establishing
eligibility for programs of financial aid
assistance for training and education
programs not provided under WIOA.
b) Individualized career services
must be made available if determined to
be appropriate in order for an individual
to obtain or retain employment. These
services include the following services,
as consistent with program
requirements and Federal cost
principles:
1) Comprehensive and specialized
assessments of the skill levels and
service needs of adults and dislocated
workers, which may include—
i) Diagnostic testing and use of other
assessment tools; and
ii) In-depth interviewing and
evaluation to identify employment
barriers and appropriate employment
goals;
2) Development of an individual
employment plan, to identify the
employment goals, appropriate
achievement objectives, and appropriate
combination of services for the
participant to achieve his or her
employment goals, including the list of,
and information about, the eligible
training providers (as described in 20
CFR 680. 180);
3) Group counseling;
4) Individual counseling;
5) Career planning;
6) Short-term pre -vocational services
including development of learning
skills, communication skills,
interviewing skills, punctuality,
personal maintenance skills, and
professional conduct services to prepare
individuals for unsubsidized
employment or training;
7) Internships and work experiences
that are linked to careers ( as described
in 20 CFR 680. 170);
8) Workforce preparation activities;
9) Financial literacy services as
described in sec. 129( b)( 2)( D) of WIOA
and 20 CFR 681. 500;
10) Out -of -area job search assistance
and relocation assistance; and
11) English language acquisition and
integrated education and training
programs.
c) Follow-up services must be
provided, as appropriate, including:
Counseling regarding the workplace, for
participants in adult or dislocated
worker workforce investment activities
who are placed in unsubsidized
employment, for up to 12 months after
the first day of employment.
d) In addition to the requirements in
paragraph (a)( 2) of this section, TANF
agencies must identify employment
services and related support being
provided by the TANF program (within
the local area) that qualify as career
services and ensure access to them via
the local one-stop delivery system.
463.435 What are the business services
provided through the one-stop delivery
system, and how are they provided?
a) Certain career services must be
made available to local employers,
specifically labor exchange activities
and labor market information described
in §463.430(a)(4)(ii) and (a)(6). Local
areas must establish and develop
relationships and networks with large
and small employers and their
intermediaries. Local areas also must
develop, convene, or implement
industry or sector partnerships.
b) Customized business services may
be provided to employers, employer
associations, or other such
organizations. These services are
tailored for specific employers and may
include:
1) Customized screening and referral
of qualified participants in training
services to employers;
2) Customized services to employers,
employer associations, or other such
organizations, on employment-related
issues;
3) Customized recruitment events
and related services for employers
including targeted job fairs;
4) Human resource consultation
services, including but not limited to
assistance with:
i) Writing/ reviewing job descriptions
and employee handbooks;
ii) Developing performance
evaluation and personnel policies;
iii) Creating orientation sessions for
new workers;
iv) Honing job interview techniques
for efficiency and compliance;
v) Analyzing employee turnover;
vi) Creating job accommodations and
using assistive technologies; or
vii) Explaining labor and
employment laws to help employers
comply with discrimination, wage/ hour,
and safety/ health regulations;
5) Customized labor market
information for specific employers,
sectors, industries or clusters; and
6) Other similar customized services.
c) Local areas may also provide other
business services and strategies that
meet the workforce investment needs of
area employers, in accordance with
partner programs' statutory
requirements and consistent with
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Federal cost principles. These business
services may be provided through
effective business intermediaries
working in conjunction with the Local
WDB, or through the use of economic
development, philanthropic, and other
public and private resources in a
manner determined appropriate by the
Local WDB and in cooperation with the
State. Allowable activities, consistent
with each partner' s authorized
activities, include, but are not limited
to:
1) Developing and implementing
industry sector strategies ( including
strategies involving industry
partnerships, regional skills alliances,
industry skill panels, and sectoral skills
partnerships);
2) Customized assistance or referral
for assistance in the development of a
registered apprenticeship program;
3) Developing and delivering
innovative workforce investment
services and strategies for area
employers, which may include career
pathways, skills upgrading, skill
standard development and certification
for recognized postsecondary credential
or other employer use, and other
effective initiatives for meeting the
workforce investment needs of area
employers and workers;
4) Assistance to area employers in
managing reductions in force in
coordination with rapid response
activities and with strategies for the
aversion of layoffs, which may include
strategies such as early identification of
firms at risk of layoffs, use of feasibility
studies to assess the needs of and
options for at -risk firms, and the
delivery of employment and training
activities to address risk factors;
5) The marketing of business services
to appropriate area employers,
including small and mid-sized
employers; and
6) Assisting employers with
accessing local, State, and Federal tax
credits.
d) All business services and
strategies must be reflected in the local
plan, described in 20 CFR 679.560(b)( 3).
463.440 When may a fee be charged for
the business services in this subpart?
a) There is no requirement that a fee-
for-service be charged to employers.
b) No fee may be charged for services
provided in §463. 435( a).
c) A fee may be charged for services
provided under § 463.435( b) and (c).
Services provided under § 463. 435( c)
may be provided through effective
business intermediaries working in
conjunction with the Local WDB and
may also be provided on a fee-for-
service basis or through the leveraging
of economic development,
philanthropic, and other public and
private resources in a manner
determined appropriate by the Local
WDB. The Local WDB may examine the
services provided compared with the
assets and resources available within
the local one-stop delivery system and
through its partners to determine an
appropriate cost structure for services, if
any.
d) Any fees earned are recognized as
program income and must be expended
by the partner in accordance with the
partner program' s authorizing statute,
implementing regulations, and Federal
cost principles identified in Uniform
Guidance.
463. 500 What is the Memorandum of
Understanding for the one-stop delivery
system and what must be included in the
Memorandum of Understanding?
a) The MOU is the product of local
discussion and negotiation, and is an
agreement developed and executed
between the Local WDB and the one-
stop partners, with the agreement of the
chief elected official and the one-stop
partners, relating to the operation of the
one-stop delivery system in the local
area. Two or more local areas in a region
may develop a single joint MOU, if they
are in a region that has submitted a
regional plan under sec. 106 of WIOA.
b) The MOU must include:
1) A description of services to be
provided through the one-stop delivery
system, including the manner in which
the services will be coordinated and
delivered through the system;
2) Agreement on funding the costs of
the services and the operating costs of
the system, including:
i) Funding of infrastructure costs of
one-stop centers in accordance with
463. 700 through 463. 755; and
ii) Funding of the shared services and
operating costs of the one-stop delivery
system described in § 463. 760;
3) Methods for referring individuals
between the one-stop operators and
partners for appropriate services and
activities;
4) Methods to ensure that the needs
of workers, youth, and individuals with
barriers to employment, including
individuals with disabilities, are
addressed in providing access to
services, including access to technology
and materials that are available through
the one-stop delivery system;
5) The duration of the MOU and
procedures for amending it; and
6) Assurances that each MOU will be
reviewed, and if substantial changes
have occurred, renewed, not less than
once every 3 -year period to ensure
appropriate funding and delivery of
services.
c) The MOU may contain any other
provisions agreed to by the parties that
are consistent with WIOA title I, the
authorizing statutes and regulations of
one-stop partner programs, and the
WIOA regulations.
d) When fully executed, the MOU
must contain the signatures of the Local
WDB, one-stop partners, the chief
elected official(s), and the time period
in which the agreement is effective. The
MOU must be updated not less than
every 3 years to reflect any changes in
the signatory official of the Board, one-
stop partners, and chief elected officials,
or one-stop infrastructure funding.
e) If a one-stop partner appeal to the
State regarding infrastructure costs,
using the process described in
463. 750, results in a change to the one-
stop partner' s infrastructure cost
contributions, the MOU must be
updated to reflect the final one-stop
partner infrastructure cost
contributions.
463.505 Is there a single Memorandum of
Understanding for the local area, or must
there be different Memoranda of
Understanding between the Local
Workforce Development Board and each
partner?
a) A single " umbrella" MOU may be
developed that addresses the issues
relating to the local one-stop delivery
system for the Local WDB, chief elected
official and all partners. Alternatively,
the Local WDB (with agreement of chief
elected official) may enter into separate
agreements between each partner or
groups of partners.
b) Under either approach, the
requirements described in § 463. 500
apply. Since funds are generally
appropriated annually, the Local WDB
may negotiate financial agreements with
each partner annually to update funding
of services and operating costs of the
system under the MOU.
463.510 How must the Memorandum of
Understanding be negotiated?
a) WIOA emphasizes full and
effective partnerships between Local
WDBs, chief elected officials, and one-
stop partners. Local WDBs and partners
must enter into good -faith negotiations.
Local WDBs, chief elected officials, and
one-stop partners may also request
assistance from a State agency
responsible for administering the
partner program, the Governor, State
WDB, or other appropriate parties on
other aspects of the MOU.
b) Local WDBs and one-stop partners
must establish, in the MOU, how they
will fund the infrastructure costs and
other shared costs of the one-stop
centers. If agreement regarding
infrastructure costs is not reached when
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other sections of the MOU are ready, an
interim infrastructure funding
agreement may be included instead, as
described in §463. 715( c). Once
agreement on infrastructure funding is
reached, the Local WDB and one-stop
partners must amend the MOU to
include the infrastructure funding of the
one-stop centers. Infrastructure funding
is described in detail in §§463. 700
through 463. 760.
c) The Local WDB must report to the
State WDB, Governor, and relevant State
agency when MOU negotiations with
one-stop partners have reached an
impasse.
1) The Local WDB and partners must
document the negotiations and efforts
that have taken place in the MOU. The
State WDB, one-stop partner programs,
and the Governor may consult with the
appropriate Federal agencies to address
impasse situations related to issues
other than infrastructure funding after
attempting to address the impasse.
Impasses related to infrastructure cost
funding must be resolved using the
State infrastructure cost funding
mechanism described in § 463. 730.
2) The Local WDB must report failure
to execute an MOU with a required
partner to the Governor, State WDB, and
the State agency responsible for
administering the partner' s program.
Additionally, if the State cannot assist
the Local WDB in resolving the impasse,
the Governor or the State WDB must
report the failure to the Secretary of
Labor and to the head of any other
Federal agency with responsibility for
oversight of a partner' s program.
463.600 Who may operate one-stop
centers?
a) One-stop operators may be a single
entity (public, private, or nonprofit) or
a consortium of entities. If the
consortium of entities is one of one-stop
partners, it must include a minimum of
three of the one-stop partners described
in § 463.400.
b) The one-stop operator may operate
one or more one-stop centers. There
may be more than one one-stop operator
in a local area.
c) The types of entities that may be
a one-stop operator include:
1) An institution of higher education;
2) An Employment Service State
agency established under the Wagner-
Peyser Act;
3) A community-based organization,
nonprofit organization, or workforce
intermediary;
4) A private for-profit entity;
5) A government agency;
6) A Local WDB, with the approval
of the chief elected official and the
Governor; or
7) Another interested organization or
entity, which is capable of carrying out
the duties of the one-stop operator.
Examples may include a local chamber
of commerce or other business
organization, or a labor organization.
d) Elementary schools and secondary
schools are not eligible as one-stop
operators, except that a nontraditional
public secondary school such as a night
school, adult school, or an area career
and technical education school may be
selected.
e) The State and Local WDBs must
ensure that, in carrying out WIOA
programs and activities, one-stop
operators:
1) Disclose any potential conflicts of
interest arising from the relationships of
the operators with particular training
service providers or other service
providers (further discussed in 20 CFR
679.430);
2) Do not establish practices that
create disincentives to providing
services to individuals with barriers to
employment who may require longer-
term career and training services; and
3) Comply with Federal regulations
and procurement policies relating to the
calculation and use of profits, including
those at 20 CFR 683. 295, the Uniform
Guidance at 2 CFR part 200, and other
applicable regulations and policies.
463. 605 How is the one-stop operator
selected?
a) Consistent with paragraphs (b) and
c) of this section, the Local WDB must
select the one-stop operator through a
competitive process, as required by sec.
121( d)( 2)( A) of WIOA, at least once
every 4 years. A State may require, or
a Local WDB may choose to implement,
a competitive selection process more
than once every 4 years.
b) In instances in which a State is
conducting the competitive process
described in paragraph (a) of this
section, the State must follow the same
policies and procedures it uses for
procurement with non -Federal funds.
c) All other non -Federal entities,
including subrecipients of a State ( such
as local areas), must use a competitive
process based on local procurement
policies and procedures and the
principles of competitive procurement
in the Uniform Guidance set out at 2
CFR 200. 318 through 200. 326. All
references to " noncompetitive
proposals" in the Uniform Guidance at
2 CFR 200.320( f) will be read as " sole
source procurement" for the purposes of
implementing this section.
d) Entities must prepare written
documentation explaining the
determination concerning the nature of
the competitive process to be followed
in selecting a one-stop operator.
463.610 When is the sole -source
selection of one-stop operators appropriate,
and how is it conducted?
a) States may select a one-stop
operator through sole source selection
when allowed under the same policies
and procedures used for competitive
procurement with non -Federal funds,
while other non -Federal entities
including subrecipients of a State ( such
as local areas) may select a one-stop
operator through sole selection when
consistent with local procurement
policies and procedures and the
Uniform Guidance set out at 2 CFR
200. 320.
b) In the event that sole source
procurement is determined necessary
and reasonable, in accordance with
463. 605( c), written documentation
must be prepared and maintained
concerning the entire process of making
such a selection.
c) Such sole source procurement
must include appropriate conflict of
interest policies and procedures. These
policies and procedures must conform
to the specifications in 20 CFR 679.430
for demonstrating internal controls and
preventing conflict of interest.
d) A Local WDB may be selected as
a one-stop operator through sole source
procurement only with agreement of the
chief elected official in the local area
and the Governor. The Local WDB must
establish sufficient conflict of interest
policies and procedures and these
policies and procedures must be
approved by the Governor.
463.615 May an entity currently serving
as one-stop operator compete to be a one-
stop operator under the procurement
requirements of this subpart?
a) Local WDBs may compete for and
be selected as one-stop operators, as
long as appropriate firewalls and
conflict of interest policies and
procedures are in place. These policies
and procedures must conform to the
specifications in 20 CFR 679.430 for
demonstrating internal controls and
preventing conflict of interest.
b) State and local agencies may
compete for and be selected as one-stop
operators by the Local WDB, as long as
appropriate firewalls and conflict of
interest policies and procedures are in
place. These policies and procedures
must conform to the specifications in 20
CFR 679. 430 for demonstrating internal
controls and preventing conflict of
interest.
c) In the case of single -area States
where the State WDB serves as the Local
WDB, the State agency is eligible to
compete for and be selected as operator
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as long as appropriate firewalls and
conflict of interest policies are in place
and followed for the competition. These
policies and procedures must conform
to the specifications in 20 CFR 679.430
for demonstrating internal controls and
preventing conflicts of interest.
463.620 What is the one-stop operator' s
role?
a) At a minimum, the one-stop
operator must coordinate the service
delivery of required one-stop partners
and service providers. Local WDBs may
establish additional roles of one-stop
operator, including, but not limited to:
Coordinating service providers across
the one-stop delivery system, being the
primary provider of services within the
center, providing some of the services
within the center, or coordinating
service delivery in a multi -center area,
which may include affiliated sites. The
competition for a one-stop operator
must clearly articulate the role of the
one-stop operator.
b)( 1) Subject to paragraph (b)( 2) of
this section, a one-stop operator may not
perform the following functions:
Convene system stakeholders to assist in
the development of the local plan;
prepare and submit local plans (as
required under sec. 107 of WIOA); be
responsible for oversight of itself;
manage or significantly participate in
the competitive selection process for
one-stop operators; select or terminate
one-stop operators, career services, and
youth providers; negotiate local
performance accountability measures; or
develop and submit budget for activities
of the Local WDB in the local area.
2) An entity serving as a one-stop
operator, that also serves a different role
within the one-stop delivery system,
may perform some or all of these
functions when it is acting in its other
role, if it has established sufficient
firewalls and conflict of interest policies
and procedures. The policies and
procedures must conform to the
specifications in 20 CFR 679.430 for
demonstrating internal controls and
preventing conflict of interest.
463.625 Can a one-stop operator also be
a service provider?
Yes, but there must be appropriate
firewalls in place in regards to the
competition, and subsequent oversight,
monitoring, and evaluation of
performance of the service provider.
The operator cannot develop, manage,
or conduct the competition of a service
provider in which it intends to compete.
In cases where an operator is also a
service provider, there must be firewalls
and internal controls within the
operator -service provider entity, as well
as specific policies and procedures at
the Local WDB level regarding
oversight, monitoring, and evaluation of
performance of the service provider.
The firewalls must conform to the
specifications in 20 CFR 679.430 for
demonstrating internal controls and
preventing conflicts of interest.
463. 630 Can State merit staff still work in
a one-stop center where the operator is not
a governmental entity?
Yes. State merit staff can continue to
perform functions and activities in the
one-stop center. The Local WDB and
one-stop operator must establish a
system for management of merit staff in
accordance with State policies and
procedures. Continued use of State
merit staff for the provision of Wagner-
Peyser Act services or services from
other programs with merit staffing
requirements must be included in the
competition for and final contract with
the one-stop operator when Wagner-
Peyser Act services or services from
other programs with merit staffing
requirements are being provided.
463. 635 What is the compliance date of
the provisions of this subpart?
a) No later than July 1, 2017, one-stop
operators selected under the
competitive process described in this
subpart must be in place and operating
the one-stop center.
b) By November 17, 2016, every
Local WDB must demonstrate it is
taking steps to prepare for competition
of its one-stop operator. This
demonstration may include, but is not
limited to, market research, requests for
information, and conducting a cost and
price analysis.
463. 700 What are the one-stop
infrastructure costs?
a) Infrastructure costs of one-stop
centers are nonpersonnel costs that are
necessary for the general operation of
the one-stop center, including:
1) Rental of the facilities;
2) Utilities and maintenance;
3) Equipment (including assessment -
related products and assistive
technology for individuals with
disabilities); and
4) Technology to facilitate access to
the one-stop center, including
technology used for the center' s
planning and outreach activities.
b) Local WDBs may consider
common identifier costs as costs of one-
stop infrastructure.
c) Each entity that carries out a
program or activities in a local one-stop
center, described in §§ 463. 400 through
463. 410, must use a portion of the funds
available for the program and activities
to maintain the one-stop delivery
system, including payment of the
infrastructure costs of one-stop centers.
These payments must be in accordance
with this subpart; Federal cost
principles, which require that all costs
must be allowable, reasonable,
necessary, and allocable to the program;
and all other applicable legal
requirements.
463.705 What guidance must the
Governor issue regarding one-stop
infrastructure funding?
a) The Governor, after consultation
with chief elected officials, the State
WDB, and Local WDBs, and consistent
with guidance and policies provided by
the State WDB, must develop and issue
guidance for use by local areas,
specifically:
1) Guidelines for State -administered
one-stop partner programs for
determining such programs'
contributions to a one-stop delivery
system, based on such programs'
proportionate use of such system, and
relative benefit received, consistent with
Office of Management and Budget
OMB) Uniform Administrative
Requirements, Cost Principles, and
Audit Requirements for Federal Awards
in 2 CFR part 200, including
determining funding for the costs of
infrastructure; and
2) Guidance to assist Local WDBs,
chief elected officials, and one-stop
partners in local areas in determining
equitable and stable methods of funding
the costs of infrastructure at one-stop
centers based on proportionate use and
relative benefit received, and consistent
with Federal cost principles contained
in the Uniform Guidance at 2 CFR part
200.
b) The guidance must include:
1) The appropriate roles of the one-
stop partner programs in identifying
one-stop infrastructure costs;
2) Approaches to facilitate equitable
and efficient cost allocation that results
in a reasonable cost allocation
methodology where infrastructure costs
are charged to each partner based on its
proportionate use of the one-stop
centers and relative benefit received,
consistent with Federal cost principles
at 2 CFR part 200; and
3) The timelines regarding
notification to the Governor for not
reaching local agreement and triggering
the State funding mechanism described
in §463. 730, and timelines for a one-
stop partner to submit an appeal in the
State funding mechanism.
463.710 How are infrastructure costs
funded?
Infrastructure costs are funded either
through the local funding mechanism
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described in §463. 715 or through the
State funding mechanism described in
463. 730.
463.715 How are one-stop infrastructure
costs funded in the local funding
mechanism?
a) In the local funding mechanism,
the Local WDB, chief elected officials,
and one-stop partners agree to amounts
and methods of calculating amounts
each partner will contribute for one-stop
infrastructure funding, include the
infrastructure funding terms in the
MOU, and sign the MOU. The local
funding mechanism must meet all of the
following requirements:
1) The infrastructure costs are funded
through cash and fairly evaluated non-
cash and third -party in-kind partner
contributions and include any funding
from philanthropic organizations or
other private entities, or through other
alternative financing options, to provide
a stable and equitable funding stream
for ongoing one-stop delivery system
operations;
2) Contributions must be negotiated
between one-stop partners, chief elected
officials, and the Local WDB and the
amount to be contributed must be
included in the MOU;
3) The one-stop partner program' s
proportionate share of funding must be
calculated in accordance with the
Uniform Administrative Requirements,
Cost Principles, and Audit
Requirements for Federal Awards in 2
CFR part 200 based upon a reasonable
cost allocation methodology whereby
infrastructure costs are charged to each
partner in proportion to its use of the
one-stop center, relative to benefits
received. Such costs must also be
allowable, reasonable, necessary, and
allocable;
4) Partner shares must be
periodically reviewed and reconciled
against actual costs incurred, and
adjusted to ensure that actual costs
charged to any one-stop partners are
proportionate to the use of the one-stop
center and relative to the benefit
received by the one-stop partners and
their respective programs or activities.
b) In developing the section of the
MOU on one-stop infrastructure funding
described in §463. 755, the Local WDB
and chief elected officials will:
1) Ensure that the one-stop partners
adhere to the guidance identified in
463. 705 on one-stop delivery system
infrastructure costs.
2) Work with one-stop partners to
achieve consensus and informally
mediate any possible conflicts or
disagreements among one-stop partners.
3) Provide technical assistance to
new one-stop partners and local grant
recipients to ensure that those entities
are informed and knowledgeable of the
elements contained in the MOU and the
one-stop infrastructure costs
arrangement.
c) The MOU may include an interim
infrastructure funding agreement,
including as much detail as the Local
WDB has negotiated with one-stop
partners, if all other parts of the MOU
have been negotiated, in order to allow
the partner programs to operate in the
one-stop centers. The interim
infrastructure funding agreement must
he finalized within 6 months of when
the MOU is signed. If the interim
infrastructure funding agreement is not
finalized within that timeframe, the
Local WDB must notify the Governor, as
described in § 463. 725.
463. 720 What funds are used to pay for
infrastructure costs in the local one-stop
infrastructure funding mechanism?
a) In the local funding mechanism,
one-stop partner programs may
determine what funds they will use to
pay for infrastructure costs. The use of
these funds must be in accordance with
the requirements in this subpart, and
with the relevant partner' s authorizing
statutes and regulations, including, for
example, prohibitions against
supplanting non -Federal resources,
statutory limitations on administrative
costs, and all other applicable legal
requirements. In the case of partners
administering programs authorized by
title I of WIOA, these infrastructure
costs may be considered program costs.
In the case of partners administering
adult education and literacy programs
authorized by title II of WIOA, these
funds must include Federal funds made
available for the local administration of
adult education and literacy programs
authorized by title II of WIOA. These
funds may also include non -Federal
resources that are cash, in-kind or third -
party contributions. In the case of
partners administering the Carl D.
Perkins Career and Technical Education
Act of 2006, funds used to pay for
infrastructure costs may include funds
available for local administrative
expenses, non -Federal resources that are
cash, in-kind or third -party
contributions, and may include other
funds made available by the State.
b) There are no specific caps on the
amount or percent of overall funding a
one-stop partner may contribute to fund
infrastructure costs under the local
funding mechanism, except that
contributions for administrative costs
may not exceed the amount available for
administrative costs under the
authorizing statute of the partner
program. However, amounts contributed
for infrastructure costs must be
allowable and based on proportionate
use of the one-stop centers and relative
benefit received by the partner program,
taking into account the total cost of the
one-stop infrastructure as well as
alternate financing options, and must be
consistent with 2 CFR part 200,
including the Federal cost principles.
c) Cash, non-cash, and third -party in-
kind contributions may be provided by
one-stop partners to cover their
proportionate share of infrastructure
costs.
1) Cash contributions are cash funds
provided to the Local WDB or its
designee by one-stop partners, either
directly or by an interagency transfer.
2) Non-cash contributions are
comprised of—
i) Expenditures incurred by one-stop
partners on behalf of the one-stop
center; and
ii) Non-cash contributions or goods
or services contributed by a partner
program and used by the one-stop
center.
3) Non-cash contributions, especially
those set forth in paragraph (c)( 2)( ii) of
this section, must be valued consistent
with 2 CFR 200. 306 to ensure they are
fairly evaluated and meet the partners'
proportionate share.
4) Third -party in-kind contributions
are:
i) Contributions of space, equipment,
technology, non -personnel services, or
other like items to support the
infrastructure costs associated with one-
stop operations, by a non -one-stop
partner to support the one-stop center in
general, not a specific partner; or
ii) Contributions by a non -one-stop
partner of space, equipment,
technology, non -personnel services, or
other like items to support the
infrastructure costs associated with one-
stop operations, to a one-stop partner to
support its proportionate share of one-
stop infrastructure costs.
iii) In-kind contributions described
in paragraphs ( c)( 4)( i) and (ii) of this
section must be valued consistent with
2 CFR 200. 306 and reconciled on a
regular basis to ensure they are fairly
evaluated and meet the proportionate
share of the partner.
5) All partner contributions,
regardless of the type, must be
reconciled on a regular basis (i.e.,
monthly or quarterly), comparing actual
expenses incurred to relative benefits
received, to ensure each partner
program is contributing its
proportionate share in accordance with
the terms of the MOU.
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463.725 What happens if consensus on
infrastructure funding is not reached at the
local level between the Local Workforce
Development Board, chief elected officials,
and one-stop partners?
With regard to negotiations for
infrastructure funding for Program Year
PY) 2017 and for each subsequent
program year thereafter, if the Local
WDB, chief elected officials, and one-
stop partners do not reach consensus on
methods of sufficiently funding local
infrastructure through the local funding
mechanism in accordance with the
Governor' s guidance issued under
463. 705 and consistent with the
regulations in §§463. 715 and 463. 720,
and include that consensus agreement
in the signed MOU, then the Local WDB
must notify the Governor by the
deadline established by the Governor
under § 463. 705( b)( 3). Once notified, the
Governor must administer funding
through the State funding mechanism,
as described in §§463. 730 through
463. 738, for the program year impacted
by the local area' s failure to reach
consensus.
463.730 What is the State one-stop
infrastructure funding mechanism?
a) Consistent with sec.
121(h)(1)( A)(i)(II) of WIOA, if the Local
WDB, chief elected official, and one-
stop partners in a local area do not reach
consensus agreement on methods of
sufficiently funding the costs of
infrastructure of one-stop centers for a
program year, the State funding
mechanism is applicable to the local
area for that program year.
b) In the State funding mechanism,
the Governor, subject to the limitations
in paragraph ( c) of this section,
determines one-stop partner
contributions after consultation with the
chief elected officials, Local WDBs, and
the State WDB. This determination
involves:
1) The application of a budget for
one-stop infrastructure costs as
described in §463. 735, based on either
agreement reached in the local area
negotiations or the State WDB formula
outlined in § 463. 745;
2) The determination of each local
one-stop partner program' s
proportionate use of the one-stop
delivery system and relative benefit
received, consistent with the Uniform
Guidance at 2 CFR part 200, including
the Federal cost principles, the partner
programs' authorizing laws and
regulations, and other applicable legal
requirements described in § 463. 736;
and
3) The calculation of required
statewide program caps on
contributions to infrastructure costs
from one-stop partner programs in areas
operating under the State funding
mechanism as described in § 463. 738.
c) In certain situations, the Governor
does not determine the infrastructure
cost contributions for some one-stop
partner programs under the State
funding mechanism.
1) The Governor will not determine
the contribution amounts for
infrastructure funds for Native
American program grantees described in
20 CFR part 684. The appropriate
portion of funds to be provided by
Native American program grantees to
pay for one-stop infrastructure must be
determined as part of the development
of the MOU described in § 463. 500 and
specified in that MOU.
2) In States in which the policy-
making authority is placed in an entity
or official that is independent of the
authority of the Governor with respect
to the funds provided for adult
education and literacy activities
authorized under title II of WIOA,
postsecondary career and technical
education activities authorized under
the Carl D. Perkins Career and Technical
Education Act of 2006, or VR services
authorized under title I of the
Rehabilitation Act of 1973 ( other than
sec. 112 or part C), as amended by
WIOA title IV, the determination of the
amount each of the applicable partners
must contribute to assist in paying the
infrastructure costs of one-stop centers
must be made by the official or chief
officer of the entity with such authority,
in consultation with the Governor.
d) Any duty, ability, choice,
responsibility, or other action otherwise
related to the determination of
infrastructure costs contributions that is
assigned to the Governor in §§463. 730
through 463. 745 also applies to this
decision-making process performed by
the official or chief officer described in
paragraph (c)( 2) of this section.
463. 731 What are the steps to determine
the amount to be paid under the State one-
stop infrastructure funding mechanism?
a) To initiate the State funding
mechanism, a Local WDB that has not
reached consensus on methods of
sufficiently funding local infrastructure
through the local funding mechanism as
provided in §463. 725 must notify the
Governor by the deadline established by
the Governor under § 463. 705( b)( 3).
b) Once a Local WDB has informed
the Governor that no consensus has
been reached:
1) The Local WDB must provide the
Governor with local negotiation
materials in accordance with
463. 735( a).
2) The Governor must determine the
one-stop center budget by either:
i) Accepting a budget previously
agreed upon by partner programs in the
local negotiations, in accordance with
463. 735( b)( 1); or
ii) Creating a budget for the one-stop
center using the State WDB formula
described in § 463. 745) in accordance
with §463. 735(b)( 3).
3) The Governor then must establish
a cost allocation methodology to
determine the one-stop partner
programs' proportionate shares of
infrastructure costs, in accordance with
463. 736.
4)( i) Using the methodology
established under paragraph (b)( 2)( ii) of
this section, and taking into
consideration the factors concerning
individual partner programs listed in
463. 737(b)( 2), the Governor must
determine each partner' s proportionate
share of the infrastructure costs, in
accordance with §463. 737(b)( 1), and
ii) In accordance with §463. 730( c), in
some instances, the Governor does not
determine a partner program' s
proportionate share of infrastructure
funding costs, in which case it must be
determined by the entities named in
463. 730( c)( 1) and (2).
5) The Governor must then calculate
the statewide caps on the amounts that
partner programs may be required to
contribute toward infrastructure
funding, according to the steps found at
463. 738( a)( 1) through (4).
6) The Governor must ensure that the
aggregate total of the infrastructure
contributions according to proportionate
share required of all local partner
programs in local areas under the State
funding mechanism do not exceed the
cap for that particular program, in
accordance with §463. 738(b)( 1). If the
total does not exceed the cap, the
Governor must direct each one-stop
partner program to pay the amount
determined under § 463. 737( a) toward
the infrastructure funding costs of the
one-stop center. If the total does exceed
the cap, then to determine the amount
to direct each one-stop program to pay,
the Governor may:
i) Ascertain, in accordance with
463.738(b)(2)(i),whether the local
partner or partners whose proportionate
shares are calculated above the
individual program caps are willing to
voluntarily contribute above the capped
amount to equal that program' s
proportionate share; or
ii) Choose from the options provided
in § 463.738(b)(2)(ii), including having
the local area re-enter negotiations to
reassess each one-stop partner' s
proportionate share and make
adjustments or identify alternate sources
56067Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
of funding to make up the difference
between the capped amount and the
proportionate share of infrastructure
funding of the one-stop partner.
7) If none of the solutions given in
paragraphs (b)(6)(i) and (ii) of this
section prove to be viable, the Governor
must reassess the proportionate shares
of each one-stop partner so that the
aggregate amount attributable to the
local partners for each program is less
than that program' s cap amount. Upon
such reassessment, the Governor must
direct each one-stop partner program to
pay the reassessed amount toward the
infrastructure funding costs of the one-
stop center.
463.735 How are infrastructure cost
budgets for the one-stop centers in a local
area determined in the State one-stop
infrastructure funding mechanism?
a) Local WDBs must provide to the
Governor appropriate and relevant
materials and documents used in the
negotiations under the local funding
mechanism, including but not limited
to: The local WIOA plan, the cost
allocation method or methods proposed
by the partners to be used in
determining proportionate share, the
proposed amounts or budget to fund
infrastructure, the amount of total
partner funds included, the type of
funds or non-cash contributions,
proposed one-stop center budgets, and
any agreed upon or proposed MOUs.
b)( 1) If a local area has reached
agreement as to the infrastructure
budget for the one-stop centers in the
local area, it must provide this budget
to the Governor as required by
paragraph (a) of this section. If, as a
result of the agreed upon infrastructure
budget, only the individual
programmatic contributions to
infrastructure funding based upon
proportionate use of the one-stop
centers and relative benefit received are
at issue, the Governor may accept the
budget, from which the Governor must
calculate each partner' s contribution
consistent with the cost allocation
methodologies contained in the Uniform
Guidance found in 2 CFR part 200, as
described in §463. 736.
2) The Governor may also take into
consideration the extent to which the
partners in the local area have agreed in
determining the proportionate shares,
including any agreements reached at the
local level by one or more partners, as
well as any other element or product of
the negotiating process provided to the
Governor as required by paragraph (a) of
this section.
3) If a local area has not reached
agreement as to the infrastructure
budget for the one-stop centers in the
local area, or if the Governor determines
that the agreed upon budget does not
adequately meet the needs of the local
area or does not reasonably work within
the confines of the local area' s resources
in accordance with the Governor' s one-
stop budget guidance (which is required
to be issued by WIOA sec. 121( h)(1)( B)
and under § 463. 705), then, in
accordance with §463. 745, the
Governor must use the formula
developed by the State WDB based on
at least the factors required under
463. 745, and any associated weights to
determine the local area budget.
463. 736 How does the Governor
establish a cost allocation methodology
used to determine the one-stop partner
programs' proportionate shares of
infrastructure costs under the State one-
stop infrastructure funding mechanism?
Once the appropriate budget is
determined for a local area through
either method described in § 463. 735
by acceptance of a budget agreed upon
in local negotiation or by the Governor
applying the formula detailed in
463. 745), the Governor must
determine the appropriate cost
allocation methodology to be applied to
the one-stop partners in such local area,
consistent with the Federal cost
principles permitted under 2 CFR part
200, to fund the infrastructure budget.
463. 737 How are one-stop partner
programs' proportionate shares of
infrastructure costs determined under the
State one-stop infrastructure funding
mechanism?
a) The Governor must direct the one-
stop partners in each local area that
have not reached agreement under the
local funding mechanism to pay what
the Governor determines is each partner
program' s proportionate share of
infrastructure funds for that area,
subject to the application of the caps
described in § 463. 738.
b)( 1) The Governor must use the cost
allocation methodology— as determined
under § 463. 736— to determine each
partner' s proportionate share of the
infrastructure costs under the State
funding mechanism, subject to
considering the factors described in
paragraph (b)( 2) of this section.
2) In determining each partner
program' s proportionate share of
infrastructure costs, the Governor must
take into account the costs of
administration of the one-stop delivery
system for purposes not related to one-
stop centers for each partner (such as
costs associated with maintaining the
Local WDB or information technology
systems), as well as the statutory
requirements for each partner program,
the partner program' s ability to fulfill
such requirements, and all other
applicable legal requirements. The
Governor may also take into
consideration the extent to which the
partners in the local area have agreed in
determining the proportionate shares,
including any agreements reached at the
local level by one or more partners, as
well as any other materials or
documents of the negotiating process,
which must be provided to the Governor
by the Local WDB and described in
463. 735( a).
463.738 How are statewide caps on the
contributions for one-stop infrastructure
funding determined in the State one-stop
infrastructure funding mechanism?
a) The Governor must calculate the
statewide cap on the contributions for
one-stop infrastructure funding required
to be provided by each one-stop partner
program for those local areas that have
not reached agreement. The cap is the
amount determined under paragraph
a)( 4) of this section, which the
Governor derives by:
1) First, determining the amount
resulting from applying the percentage
for the corresponding one-stop partner
program provided in paragraph (d) of
this section to the amount of Federal
funds provided to carry out the one-stop
partner program in the State for the
applicable fiscal year;
2) Second, selecting a factor (or
factors) that reasonably indicates the use
of one-stop centers in the State,
applying such factor(s) to all local areas
in the State, and determining the
percentage of such factor(s) applicable
to the local areas that reached agreement
under the local funding mechanism in
the State;
3) Third, determining the amount
resulting from applying the percentage
determined in paragraph (a)( 2) of this
section to the amount determined under
paragraph (a)( 1) of this section for the
one-stop partner program; and
4) Fourth, determining the amount
that results from subtracting the amount
determined under paragraph (a)( 3) of
this section from the amount
determined under paragraph ( a)( 1) of
this section. The outcome of this final
calculation results in the partner
program' s cap.
b)( 1) The Governor must ensure that
the funds required to be contributed by
each partner program in the local areas
in the State under the State funding
mechanism, in aggregate, do not exceed
the statewide cap for each program as
determined under paragraph ( a) of this
section.
2) If the contributions initially
determined under § 463. 737 would
exceed the applicable cap determined
56068 Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
under paragraph (a) of this section, the
Governor may:
i) Ascertain if the one-stop partner
whose contribution would otherwise
exceed the cap determined under
paragraph (a) of this section will
voluntarily contribute above the capped
amount, so that the total contributions
equal that partner' s proportionate share.
The one-stop partner' s contribution
must still be consistent with the
program' s authorizing laws and
regulations, the Federal cost principles
in 2 CFR part 200, and other applicable
legal requirements; or
ii)Direct or allow the Local WDB,
chief elected officials, and one-stop
partners to: Re-enter negotiations, as
necessary; reduce the infrastructure
costs to reflect the amount of funds that
are available for such costs without
exceeding the cap levels; reassess the
proportionate share of each one-stop
partner; or identify alternative sources
of financing for one-stop infrastructure
funding, consistent with the
requirement that each one-stop partner
pay an amount that is consistent with
the proportionate use of the one-stop
center and relative benefit received by
the partner, the program' s authorizing
laws and regulations, the Federal cost
principles in 2 CFR part 200, and other
applicable legal requirements.
3) If applicable under paragraph
b)( 2)( ii) of this section, the Local WDB,
chief elected officials, and one-stop
partners, after renegotiation, may come
to agreement, sign an MOU, and
proceed under the local funding
mechanism. Such actions do not require
the redetermination of the applicable
caps under paragraph (a) of this section.
4) If, after renegotiation, agreement
among partners still cannot be reached
or alternate financing cannot be
identified, the Governor may adjust the
specified allocation, in accordance with
the amounts available and the
limitations described in paragraph (d) of
this section. In determining these
adjustments, the Governor may take into
account information relating to the
renegotiation as well as the information
described in §463. 735( a).
c) Limitations. Subject to paragraph
a) of this section and in accordance
with WIOA sec. 121( h)(2)( D), the
following limitations apply to the
Governor' s calculations of the amount
that one-stop partners in local areas that
have not reached agreement under the
local funding mechanism may be
required under § 463. 736 to contribute
to one-stop infrastructure funding:
1) WIOA formula programs and
Wagner-Peyser Act Employment Service.
The portion of funds required to be
contributed under the WIOA youth,
adult, or dislocated worker programs, or
under the Wagner-Peyser Act (29 U.S.C.
49 et seq.) must not exceed three
percent of the amount of the program in
the State for a program year.
2) Other one-stop partners. For
required one-stop partners other than
those specified in paragraphs ( c)( 1), ( 3),
5), and ( 6) of this section, the portion
of funds required to be contributed must
not exceed 1. 5 percent of the amount of
Federal funds provided to carry out that
program in the State for a fiscal year.
For purposes of the Carl D. Perkins
Career and Technical Education Act of
2006, the cap on contributions is
determined based on the funds made
available by the State for postsecondary
level programs and activities under sec.
132 of the Carl D. Perkins Career and
Technical Education Act and the
amount of funds used by the State under
sec. 112( a)( 3) of the Perkins Act during
the prior year to administer
postsecondary level programs and
activities, as applicable.
3) Vocational Rehabilitation
i) Within a State, for the entity or
entities administering the programs
described in WIOA sec. 121( b)( 1)( B)( iv)
and § 463. 400, the allotment is based on
the one State Federal fiscal year
allotment, even in instances where that
allotment is shared between two State
agencies, and the cumulative portion of
funds required to be contributed must
not exceed—
A) 0. 75 percent of the amount of
Federal funds provided to carry out
such program in the State for Fiscal
Year 2016 for purposes of applicability
of the State funding mechanism for PY
2017;
B) 1. 0 percent of the amount
provided to carry out such program in
the State for Fiscal Year 2017 for
purposes of applicability of the State
funding mechanism for PY 2018;
C) 1. 25 percent of the amount
provided to carry out such program in
the State for Fiscal Year 2018 for
purposes of applicability of the State
funding mechanism for PY 2019;
D) 1. 5 percent of the amount
provided to carry out such program in
the State for Fiscal Year 2019 and
following years for purposes of
applicability of the State funding
mechanism for PY 2020 and subsequent
years.
ii) The limitations set forth in
paragraph (d)( 3)( i) of this section for any
given fiscal year must be based on the
final VR allotment to the State in the
applicable Federal fiscal year.
4) Federal direct spending programs.
For local areas that have not reached a
one-stop infrastructure funding
agreement by consensus, an entity
administering a program funded with
direct Federal spending, as defined in
sec. 250( c)( 8) of the Balanced Budget
and Emergency Deficit Control Act of
1985, as in effect on February 15, 2014
2 U.S. C. 900( c)( 8)), must not be
required to provide more for
infrastructure costs than the amount
that the Governor determined (as
described in §463. 737).
5) TANF programs. For purposes of
TANF, the cap on contributions is
determined based on the total Federal
TANF funds expended by the State for
work, education, and training activities
during the prior Federal fiscal year (as
reported to the Department of Health
and Human Services (HHS) on the
quarterly TANF Financial Report form),
plus any additional amount of Federal
TANF funds that the State TANF agency
reasonably determines was expended
for administrative costs in connection
with these activities but that was
separately reported to HHS as an
administrative cost. The State' s
contribution to the one-stop
infrastructure must not exceed 1. 5
percent of these combined expenditures.
6) Community Services Block Grant
CSBG) programs. For purposes of
CSBG, the cap on contributions will be
based on the total amount of CSBG
funds determined by the State to have
been expended by local CSBG-eligible
entities for the provision of employment
and training activities during the prior
Federal fiscal year for which
information is available (as reported to
HHS on the CSBG Annual Report) and
any additional amount that the State
CSBG agency reasonably determines
was expended for administrative
purposes in connection with these
activities and was separately reported to
HHS as an administrative cost. The
State' s contribution must not exceed 1. 5
percent of these combined expenditures.
d) For programs for which it is not
otherwise feasible to determine the
amount of Federal funding used by the
program until the end of that program' s
operational year—because, for example,
the funding available for education,
employment, and training activities is
included within funding for the
program that may also be used for other
unrelated activities—the determination
of the Federal funds provided to carry
out the program for a fiscal year under
paragraph (a)( 1) of this section may be
determined by:
1) The percentage of Federal funds
available to the one-stop partner
program that were used by the one-stop
partner program for education,
employment, and training activities in
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the previous fiscal year for which data
are available; and
2) Applying the percentage
determined under paragraph ( d)( 1) of
this section to the total amount of
Federal funds available to the one-stop
partner program for the fiscal year for
which the determination under
paragraph (a)( 1) of this section applies.
463.740 What funds are used to pay for
infrastructure costs in the State one-stop
infrastructure funding mechanism?
a) In the State funding mechanism,
infrastructure costs for WIOA title I
programs, including Native American
Programs described in 20 CFR part 684,
may be paid using program funds,
administrative funds, or both.
Infrastructure costs for the Senior
Community Service Employment
Program under title V of the Older
Americans Act (42 U.S. C. 3056 et seq.)
may also be paid using program funds,
administrative funds, or both.
b) In the State funding mechanism,
infrastructure costs for other required
one-stop partner programs (listed in
463.400 through 463.410) are limited
to the program' s administrative funds,
as appropriate.
c) In the State funding mechanism,
infrastructure costs for the adult
education program authorized by title II
of WIOA must be paid from the funds
that are available for local
administration and may be paid from
funds made available by the State or
non -Federal resources that are cash, in-
kind, or third -party contributions.
d) In the State funding mechanism,
infrastructure costs for the Carl D.
Perkins Career and Technical Education
Act of 2006 must be paid from funds
available for local administration of
postsecondary level programs and
activities to eligible recipients or
consortia of eligible recipients and may
be paid from funds made available by
the State or non -Federal resources that
are cash, in-kind, or third -party
contributions.
463.745 What factors does the State
Workforce Development Board use to
develop the formula described in Workforce
Innovation and Opportunity Act, which is
used by the Governor to determine the
appropriate one-stop infrastructure budget
for each local area operating under the
State infrastructure funding mechanism, if
no reasonably implementable locally
negotiated budget exists?
The State WDB must develop a
formula, as described in WIOA sec.
121(h)(3)( B), to be used by the Governor
under § 463. 735(b)( 3) in determining the
appropriate budget for the infrastructure
costs of one-stop centers in the local
areas that do not reach agreement under
the local funding mechanism and are,
therefore, subject to the State funding
mechanism. The formula identifies the
factors and corresponding weights for
each factor that the Governor must use,
which must include: the number of one-
stop centers in a local area; the
population served by such centers; the
services provided by such centers; and
any factors relating to the operations of
such centers in the local area that the
State WDB determines are appropriate.
As indicated in § 463. 735( b)( 1), if the
local area has agreed on such a budget,
the Governor may accept that budget in
lieu of applying the formula factors.
463. 750 When and how can a one-stop
partner appeal a one-stop infrastructure
amount designated by the State under the
State infrastructure funding mechanism?
a) The Governor must establish a
process, described under sec.
121( h)(2)( E) of WIOA, for a one-stop
partner administering a program
described in §§ 463. 400 through 463. 410
to appeal the Governor' s determination
regarding the one-stop partner' s portion
of funds to be provided for one-stop
infrastructure costs. This appeal process
must be described in the Unified State
Plan.
b) The appeal may be made on the
ground that the Governor' s
determination is inconsistent with
proportionate share requirements in
463. 735( a), the cost contribution
limitations in § 463.735(b), the cost
contribution caps in §463. 738,
consistent with the process described in
the State Plan.
c) The process must ensure prompt
resolution of the appeal in order to
ensure the funds are distributed in a
timely manner, consistent with the
requirements of 20 CFR 683. 630.
d) The one-stop partner must submit
an appeal in accordance with State' s
deadlines for appeals specified in the
guidance issued under § 463. 705( b)( 3),
or if the State has not set a deadline,
within 21 days from the Governor' s
determination.
463. 755 What are the required elements
regarding infrastructure funding that must
be included in the one-stop Memorandum
of Understanding?
The MOU, fully described in
463. 500, must contain the following
information whether the local areas use
either the local one-stop or the State
funding method:
a) The period of time in which this
infrastructure funding agreement is
effective. This may be a different time
period than the duration of the MOU.
b) Identification of an infrastructure
and shared services budget that will be
periodically reconciled against actual
costs incurred and adjusted accordingly
to ensure that it reflects a cost allocation
methodology that demonstrates how
infrastructure costs are charged to each
partner in proportion to its use of the
one-stop center and relative benefit
received, and that complies with 2 CFR
part 200 ( or any corresponding similar
regulation or ruling).
c) Identification of all one-stop
partners, chief elected officials, and
Local WDB participating in the
infrastructure funding arrangement.
d) Steps the Local WDB, chief elected
officials, and one-stop partners used to
reach consensus or an assurance that the
local area followed the guidance for the
State funding process.
e) Description of the process to be
used among partners to resolve issues
during the MOU duration period when
consensus cannot be reached.
f)Description of the periodic
modification and review process to
ensure equitable benefit among one-stop
partners.
463.760 How do one-stop partners jointly
fund other shared costs under the
Memorandum of Understanding?
a) In addition to jointly funding
infrastructure costs, one-stop partners
listed in §§ 463. 400 through 463. 410
must use a portion of funds made
available under their programs'
authorizing Federal law (or fairly
evaluated in-kind contributions) to pay
the additional costs relating to the
operation of the one-stop delivery
system. These other costs must include
applicable career services and may
include other costs, including shared
services.
b) For the purposes of paragraph (a)
of this section, shared services' costs
may include the costs of shared services
that are authorized for and may be
commonly provided through the one-
stop partner programs to any individual,
such as initial intake, assessment of
needs, appraisal of basic skills,
identification of appropriate services to
meet such needs, referrals to other one-
stop partners, and business services.
Shared operating costs may also include
shared costs of the Local WDB' s
functions.
c) Contributions to the additional
costs related to operation of the one-stop
delivery system may be cash, non-cash,
or third -party in-kind contributions,
consistent with how these are described
in §463. 720( c).
d) The shared costs described in
paragraph (a) of this section must be
allocated according to the proportion of
benefit received by each of the partners,
consistent with the Federal law
authorizing the partner' s program, and
56070 Federal Register/ Vol. 81, No. 161 / Friday, August 19, 2016 / Rules and Regulations
consistent with all other applicable legal
requirements, including Federal cost
principles in 2 CFR part 200 ( or any
corresponding similar regulation or
ruling) requiring that costs are
allowable, reasonable, necessary, and
allocable.
e) Any shared costs agreed upon by
the one-stop partners must be included
in the MOU.
463.800 How are one-stop centers and
one-stop delivery systems certified for
effectiveness, physical and programmatic
accessibility, and continuous
improvement?
a) The State WDB, in consultation
with chief elected officials and Local
WDBs, must establish objective criteria
and procedures for Local WDBs to use
when certifying one-stop centers.
1) The State WDB, in consultation
with chief elected officials and Local
WDBs, must review and update the
criteria every 2 years as part of the
review and modification of State Plans
pursuant to § 463. 135.
2) The criteria must be consistent
with the Governor' s and State WDB' s
guidelines, guidance, and policies on
infrastructure funding decisions,
described in §463. 705. The criteria
must evaluate the one-stop centers and
one-stop delivery system for
effectiveness, including customer
satisfaction, physical and programmatic
accessibility, and continuous
improvement.
3) When the Local WDB is the one-
stop operator as described in 20 CFR
679. 410, the State WDB must certify the
one-stop center.
b) Evaluations of effectiveness must
include how well the one-stop center
integrates available services for
participants and businesses, meets the
workforce development needs of
participants and the employment needs
of local employers, operates in a cost-
efficient manner, coordinates services
among the one-stop partner programs,
and provides access to partner program
services to the maximum extent
practicable, including providing
services outside of regular business
hours where there is a workforce need,
as identified by the Local WDB. These
evaluations must take into account
feedback from one-stop customers. They
must also include evaluations of how
well the one-stop center ensures equal
opportunity for individuals with
disabilities to participate in or benefit
from one-stop center services. These
evaluations must include criteria
evaluating how well the centers and
delivery systems take actions to comply
with the disability -related regulations
implementing WIOA sec. 188, set forth
at 29 CFR part 38. Such actions include,
hut are not limited to:
1) Providing reasonable
accommodations for individuals with
disabilities;
2) Making reasonable modifications
to policies, practices, and procedures
where necessary to avoid discrimination
against persons with disabilities;
3) Administering programs in the
most integrated setting appropriate;
4) Communicating with persons with
disabilities as effectively as with others;
5) Providing appropriate auxiliary
aids and services, including assistive
technology devices and services, where
necessary to afford individuals with
disabilities an equal opportunity to
participate in, and enjoy the benefits of,
the program or activity; and
6) Providing for the physical
accessibility of the one-stop center to
individuals with disabilities.
c) Evaluations of continuous
improvement must include how well
the one-stop center supports the
achievement of the negotiated local
levels of performance for the indicators
of performance for the local area
described in sec. 116( b)( 2) of WIOA and
part 463. Other continuous
improvement factors may include a
regular process for identifying and
responding to technical assistance
needs, a regular system of continuing
professional staff development, and
having systems in place to capture and
respond to specific customer feedback.
d) Local WDBs must assess at least
once every 3 years the effectiveness,
physical and programmatic
accessibility, and continuous
improvement of one-stop centers and
the one-stop delivery systems using the
criteria and procedures developed by
the State WDB. The Local WDB may
establish additional criteria, or set
higher standards for service
coordination, than those set by the State
criteria. Local WDBs must review and
update the criteria every 2 years as part
of the Local Plan update process
described in §463. 580. Local WDBs
must certify one-stop centers in order to
be eligible to use infrastructure funds in
the State funding mechanism described
in § 463. 730.
e) All one-stop centers must comply
with applicable physical and
programmatic accessibility
requirements, as set forth in 29 CFR part
38, the implementing regulations of
WIOA sec. 188.
463.900 What is the common identifier to
be used by each one-stop delivery system?
a) The common one-stop delivery
system identifier is " American Job
Center."
b) As of November 17, 2016, each
one-stop delivery system must include
the " American Job Center" identifier or
a proud partner of the American Job
Center network" on all primary
electronic resources used by the one-
stop delivery system, and on any newly
printed, purchased, or created materials.
c) As of July 1, 2017, each one-stop
delivery system must include the
American Job Center" identifier or " a
proud partner of the American Job
Center network" on all products,
programs, activities, services, electronic
resources, facilities, and related
property and new materials used in the
one-stop delivery system.
d) One-stop partners, States, or local
areas may use additional identifiers on
their products, programs, activities,
services, facilities, and related property
and materials.
Signed at Washington, DC, this 29th day of
June 2016.
Thomas E. Perez,
Secretary ofLabor.
John B. King, Jr.,
Secretary ofEducation.
FR Doc. 2016-15977 Filed 8- 8-16; 11: 15 am]
BILLING CODE 4000-01-P; 4510 -FN -P; 4510 -FT -P