```

[Congressional Bills 109th Congress]
[From the U.S. Government Publishing Office]
[H.R. 27 Introduced in House (IH)]

109th CONGRESS
  1st Session
                                 H. R. 27

      To enhance the workforce investment system of the Nation by 
  strengthening one-stop career centers, providing for more effective 
governance arrangements, promoting access to a more comprehensive array 
of employment, training, and related services, establishing a targeted 
 approach to serving youth, and improving performance accountability, 
                        and for other purposes.

_______________________________________________________________________

                    IN THE HOUSE OF REPRESENTATIVES

                            January 4, 2005

 Mr. McKeon (for himself, Mr. Boehner, Mr. Tiberi, Mr. Porter, and Mr. 
    Kline) introduced the following bill; which was referred to the 
                Committee on Education and the Workforce

_______________________________________________________________________

                                 A BILL

 
      To enhance the workforce investment system of the Nation by 
  strengthening one-stop career centers, providing for more effective 
governance arrangements, promoting access to a more comprehensive array 
of employment, training, and related services, establishing a targeted 
 approach to serving youth, and improving performance accountability, 
                        and for other purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Job Training Improvement Act of 
2005''.

SEC. 2. TABLE OF CONTENTS.

Sec. 1. Short title.
Sec. 2. Table of contents.
Sec. 3. References.
 TITLE I--AMENDMENTS TO TITLE I OF THE WORKFORCE INVESTMENT ACT OF 1998

Sec. 101. Definitions.
Sec. 102. Purpose.
Sec. 103. State workforce investment boards.
Sec. 104. State plan.
Sec. 105. Local workforce investment areas.
Sec. 106. Local workforce investment boards.
Sec. 107. Local plan.
Sec. 108. Establishment of one-stop delivery systems.
Sec. 109. Eligible providers of training services.
Sec. 110. Eligible providers of youth activities.
Sec. 111. Youth Activities.
Sec. 112. Comprehensive programs for adults.
Sec. 113. Performance accountability system.
Sec. 114. Authorization of appropriations.
Sec. 115. Job corps.
Sec. 116. Native American programs.
Sec. 117. Migrant and seasonal farmworker programs.
Sec. 118. Veterans' workforce investment programs.
Sec. 119. Youth challenge grants.
Sec. 120. Technical assistance.
Sec. 121. Demonstration, pilot, multiservice, research and multi-State 
                            projects.
Sec. 122. Community-based job training.
Sec. 123. Personal Reemployment Accounts.
Sec. 124. National dislocated worker grants.
Sec. 125. Authorization of appropriations for national activities.
Sec. 126. Requirements and restrictions.
Sec. 127. Nondiscrimination.
Sec. 128. Administrative provisions.
Sec. 129. General program requirements.
                       TITLE II--ADULT EDUCATION

        Part A--Adult basic skills and family Literacy education

Sec. 201. Table of contents.
Sec. 202. Amendment.
                       Part B--General provisions

Sec. 211. Transition.
             TITLE III--AMENDMENTS TO THE WAGNER-PEYSER ACT

Sec. 301. Amendments to the Wagner-Peyser Act.
         TITLE IV--AMENDMENTS TO THE REHABILITATION ACT OF 1973

Sec. 401. Findings.
Sec. 402. Rehabilitation services administration.
Sec. 403. Director.
Sec. 404. Definitions.
Sec. 405. State plan.
Sec. 406. Scope of services.
Sec. 407. Standards and indicators.
Sec. 408. Reservation for expanded transition services.
Sec. 409. Chairperson.
Sec. 410. Authorizations of appropriations.
Sec. 411. Conforming amendment.
Sec. 412. Helen Keller National Center Act.
                 TITLE V--TRANSITION AND EFFECTIVE DATE

Sec. 501. Transition provisions.
Sec. 502. Effective date.

SEC. 3. REFERENCES.

    Except as otherwise expressly provided, wherever in this Act an 
amendment or repeal is expressed in terms of an amendment to, or repeal 
of, a section or other provision, the amendment or repeal shall be 
considered to be made to a section or other provision of the Workforce 
Investment Act of 1998 (20 U.S.C. 9201 et seq.).

 TITLE I--AMENDMENTS TO TITLE I OF THE WORKFORCE INVESTMENT ACT OF 1998

SEC. 101. DEFINITIONS.

    Section 101 (29 U.S.C. 2801) is amended--
            (1) by striking paragraph (13) and redesignating paragraphs 
        (1) through (12) as paragraphs (2) through (13) respectively;
            (2) by inserting after ``In this title:'' the following new 
        paragraph:
            ``(1) Accrued expenditures.--The term `accrued 
        expenditures' means charges incurred by recipients of funds 
        under this title for a given period requiring the provision of 
        funds for goods or other tangible property received; services 
        performed by employees, contractors, subgrantees, and other 
        payees; and other amounts becoming owed under programs assisted 
        under this title for which no current services or performance 
        is required, such as annuities, insurance claims, and other 
        benefit payments.'';
            (3) in paragraph (5) (as so redesignated), by inserting 
        ``(or such other level as the Governor may establish)'' after 
        ``8th grade level'';
            (4) in paragraph (9) (as so redesignated)--
                    (A) in subparagraph (B), by striking ``and'' after 
                the semicolon;
                    (B) in subparagraph (C)--
                            (i) by striking ``not less than 50 percent 
                        of the cost of the training'' and inserting ``a 
                        significant portion of the cost of training, as 
                        determined by the local board''; and
                            (ii) by striking the period and inserting 
                        ``; and''; and
                    (C) by adding at the end the following:
                    ``(D) for customized training with an employer in 
                multiple local areas in the State, a significant 
                portion of the cost of the training, as determined by 
                the Governor.'';
            (5) in paragraph 10(A)(ii)(II) (as so redesignated) by 
        striking ``section 134(c)'' and inserting ``section 121(e)'';
            (6) in paragraph (13)(A) (as so redesignated) by striking 
        ``section 122(e)(3)'' and inserting ``section 122''.
            (7) by striking paragraph (24) and redesignating paragraphs 
        (25) through (32) as paragraphs (24) through (31), 
        respectively;
            (8) in paragraph (24) (as so redesignated)--
                    (A) in subparagraph (B), by striking ``higher of--
                '' and all that follows through ``such subparagraph'' 
                and inserting ``poverty line for an equivalent 
                period;''; and
                    (B) by redesignating subparagraphs (D) through (F) 
                as subparagraph (E) through (G), respectively, and 
                inserting after subparagraph (C) the following:
                    ``(D) receives or is eligible to receive free or 
                reduced price lunch under the Richard B. Russell 
                National School Lunch Act (42 U.S.C. 1751 et seq.);'';
            (9) in paragraph (31) (as so redesignated) by striking 
        ``the Republic of the Marshall Islands, the Federated States of 
        Micronesia,''; and
            (10) by striking paragraph (33) and redesignating 
        paragraphs (34) through (53) as paragraphs (32) through (51), 
        respectively.

SEC. 102. PURPOSE.

    Section 106 (29 U.S.C. 2811) is amended by inserting at the end the 
following: ``It is also the purpose of this subtitle to provide 
workforce investment activities in a manner that promotes the informed 
choice of participants and actively involves participants in decisions 
affecting their participation in such activities.''.

SEC. 103. STATE WORKFORCE INVESTMENT BOARDS.

    (a) Membership.--
            (1) In general.--Section 111(b) (29 U.S.C. 2821(b)) is 
        amended--
                    (A) by amending paragraph (1)(C) to read as 
                follows:
                    ``(C) representatives appointed by the Governor, 
                who are--
                            ``(i)(I) the lead State agency officials 
                        with responsibility for the programs and 
                        activities that are described in section 121(b) 
                        and carried out by one-stop partners;
                            ``(II) in any case in which no lead State 
                        agency official has responsibility for such a 
                        program or activity, a representative in the 
                        State with expertise relating to such program 
                        or activity; and
                            ``(III) if not included under subclause 
                        (I), the director of the State unit, defined in 
                        section 7(8)(B) of the Rehabilitation Act of 
                        1973 (29 U.S.C. 705(8)(B)) except that in a 
                        State that has established 2 or more designated 
                        State units to administer the vocational 
                        rehabilitation program, the board 
                        representative shall be the director of the 
                        designated State unit that serves the most 
                        individuals with disabilities in the State;
                            ``(ii) the State agency officials 
                        responsible for economic development;
                            ``(iii) representatives of business in the 
                        State who--
                                    ``(I) are owners of businesses, 
                                chief executive or operating officers 
                                of businesses, and other business 
                                executives or employers with optimum 
                                policy making or hiring authority, 
                                including members of local boards 
                                described in section 117(b)(2)(A)(i);
                                    ``(II) represent businesses with 
                                employment opportunities that reflect 
                                employment opportunities in the State; 
                                and
                                    ``(III) are appointed from among 
                                individuals nominated by State business 
                                organizations and business trade 
                                associations;
                            ``(iv) chief elected officials 
                        (representing both cities and counties, where 
                        appropriate);
                            ``(v) representatives of labor 
                        organizations, who have been nominated by State 
                        labor federations; and
                            ``(vi) such other representatives and State 
                        agency officials as the Governor may 
                        designate.''; and
                    (B) in paragraph (3), by striking ``paragraph 
                (1)(C)(i)'' and inserting ``paragraph (1)(C)(iii)''.
            (2) Conforming amendment.--Section 111(c) (29 U.S.C 
        2811(c)) is amended by striking ``subsection (b)(1)(C)(i)'' and 
        inserting ``subsection (b)(1)(C)(iii)''.
    (b) Functions.--Section 111(d) (29 U.S.C. 2811(d)) is amended--
            (1) in paragraph (2), by striking ``section 134(c)'' and 
        inserting ``section 121(e)'';
            (2) by amending paragraph (3) to read as follows:
            ``(3) development and review of statewide policies 
        affecting the integrated provision of services through the one-
        stop delivery system described in section 121, including--
                    ``(A) the development of criteria for, and the 
                issuance of, certifications of one-stop centers;
                    ``(B) the criteria for the allocation of one-stop 
                center infrastructure funding under section 121(h), and 
                oversight of the use of such funds;
                    ``(C) approaches to facilitating equitable and 
                efficient cost allocation in one-stop delivery systems; 
                and
                    ``(D) such other matters that may promote statewide 
                objectives for, and enhance the performance of, one-
                stop delivery systems within the State;'';
            (3) in paragraph (4), by inserting ``and the development of 
        State criteria relating to the appointment and certification of 
        local boards under section 117'' after ``section 116'';
            (4) in paragraph (5), by striking ``sections 128(b)(3)(B) 
        and 133(b)(3)(B)'' and inserting ``sections 128(b)(3) and 
        133(b)(3)''; and
            (5) in paragraph (9), by striking ``section 503'' and 
        inserting ``section 136(i)''.
    (c) Elimination of Alternative Entity and Provision of Authority to 
Hire Staff.--Section 111(e) (29 U.S.C. 2821(e)) is amended to read as 
follows:
    ``(e) Authority to Hire Staff.--The State board may hire staff to 
assist in carrying out the functions described in subsection (d).''.

SEC. 104. STATE PLAN.

    (a) Planning Cycle.--Section 112(a) (29 U.S.C. 2822(a)) is amended 
by striking ``5-year strategy'' and inserting ``2-year strategy''.
    (b) Contents.--Section 112(b) (29 U.S.C. 2822(b)) is amended--
            (1) in paragraph (12)(A), by striking ``sections 
        128(b)(3)(B) and 133(b)(3)(B)'' and inserting ``sections 
        128(b)(3) and 133(b)(3)'';
            (2) in paragraph (14), by striking ``section 134(c)'' and 
        inserting ``section 121(e)'';
            (3) in paragraph (17)(A)
                    (A) in clause (iii) by striking ``and'';
                    (B) by amending clause (iv) to read as follows:
                            ``(iv) how the State will serve the 
                        employment and training needs of dislocated 
                        workers (including displaced homemakers and 
                        formerly self-employed and transitioning 
                        farmers, ranchers, and fisherman) low income 
                        individuals (including recipients of public 
                        assistance), homeless individuals, ex-
                        offenders, individuals training for 
                        nontraditional employment, and other 
                        individuals with multiple barriers to 
                        employment (including older individuals);''; 
                        and
                    (C) by adding the following new clause after clause 
                (iv):
                            ``(v) how the State will serve the 
                        employment and training needs of individuals 
                        with disabilities, consistent with section 188 
                        and Executive Order 13217 (42 U.S.C. 12131 
                        note; relating to community-based alternatives 
                        for individuals with disabilities) including 
                        the provision of outreach, intake, assessments, 
                        and service delivery, the development of 
                        performance measures, and the training of 
                        staff;'';
            (4) in paragraph (18)(D), by striking ``youth opportunity 
        grants'' and inserting ``youth challenge grants''; and
            (5) by adding at the end the following new paragraphs:
            ``(19) a description of the methodology for determining 
        one-stop partner program contributions for the cost of the 
        infrastructure of one-stop centers under section 121(h)(1) and 
        of the formula for allocating such infrastructure funds to 
        local areas under section 121(h)(3); and
            ``(20) a description of any programs and strategies the 
        State will utilize to meet the needs of businesses in the 
        State, including small businesses, which may include providing 
        incentives and technical assistance to assist local areas in 
        engaging employers in local workforce development 
        activities.''.
    (c) Modification to Plan.--Section 112(d) (29 U.S.C. 2822(d)) is 
amended by striking ``5-year period'' and inserting ``2-year period''.

SEC. 105. LOCAL WORKFORCE INVESTMENT AREAS.

    (a) Designation of Areas.--
            (1) Considerations.--Section 116(a)(1)(B) (29 U.S.C. 
        2831(a)(1)(B)) is amended by adding at the end the following 
        clause:
                            ``(vi) The extent to which such local areas 
                        will promote efficiency in the administration 
                        and provision of services.''.
            (2) Automatic designation.--Section 116(a)(2) (29 U.S.C. 
        2831(a)(2)) is amended to read as follows:
            ``(2) Automatic designation.--
                    ``(A) In general.--Except as provided in 
                subparagraph (B) of this paragraph and subsection (b), 
                the Governor shall approve a request for designation as 
                a local area from--
                            ``(i) any unit of general local government 
                        with a population of 500,000 or more; and
                            ``(ii) an area served by a rural 
                        concentrated employment program grant recipient 
                        that served as a service delivery area or 
                        substate area under the Job Training 
                        Partnership Act (29 U.S.C. 1501 et seq.),
                for the 2-year period covered by a State plan under 
                section 112 if such request is made not later than the 
                date of the submission of the State plan.
                    ``(B) Continued designation based on performance.--
                The Governor may deny a request for designation 
                submitted pursuant to subparagraph (A) if such unit of 
                government was designated as a local area for the 
                preceding 2-year period covered by a State plan and the 
                Governor determines that such local area did not 
                perform successfully during such period.''.
    (b) Regional Planning.--Section 116(c)(1) (29 U.S.C. 2831(c)(1)) is 
amended by adding at the end the following: ``The State may require the 
local boards for the designated region to prepare a single regional 
plan that incorporates the elements of the local plan under section 118 
and that is submitted and approved in lieu of separate local plans 
under such section.''.

SEC. 106. LOCAL WORKFORCE INVESTMENT BOARDS.

    (a) Composition.--Section 117(b)(2)(A) (29 U.S.C. 2832(b)(2)(A)) is 
amended--
            (1) in clause (i)(II), by inserting ``, businesses that are 
        in the leading industries in the local area, and large and 
        small businesses in the local area'' after ``local area'';
            (2) by amending clause (ii) to read as follows:
    ``(ii) a superintendent of the local secondary school system, an 
administrator of an entity providing adult education and literacy 
activities that is not a one-stop partner designated under section 
121(b)(1)(B), and the president or chief executive officer of a 
postsecondary educational institution serving the local area (including 
community colleges, where such entities exist);'';
            (3) in clause (iv), by striking the semicolon and inserting 
        ``and faith-based organizations; and''; and
            (4) by striking clause (vi).
    (b) Authority of Board Members.--Section 117(b)(3) (29 U.S.C. 
2832(b) is amended--
            (1) in the heading, by inserting ``and representation'' 
        after ``members''; and
            (2) by adding at the end the following: ``The members of 
        the board shall represent diverse geographic sections within 
        the local area.''.
    (c) Functions.--Section 117(d) (29 U.S.C. 2832(d)) is amended--
            (1) in paragraph (2)(B), by striking ``local area'' and all 
        that follows and inserting ``local area.''; and
            (2) in paragraph (4) by inserting ``and ensure the 
        appropriate use and management of the funds provided under this 
        title for such programs, activities, and system'' after 
        ``area''.
    (d) Authority to Establish Councils and Elimination of Requirement 
for Youth Councils.--Section 117(h) (29 U.S.C. 2832(h)) is amended to 
read as follows:
    ``(h) Establishment of Councils.--The local board may establish 
councils to provide information and advice to assist the local board in 
carrying out activities under this title. Such councils may include a 
council composed of one-stop partners to advise the local board on the 
operation of the one-stop delivery system, a youth council composed of 
experts and stakeholders in youth programs to advise the local board on 
activities for youth, and such other councils as the local board 
determines are appropriate.''.
    (e) Repeal of Alternative Entity Provision.--Section 117 (29 U.S.C. 
2832) is further amended by striking subsection (i).

SEC. 107. LOCAL PLAN.

    (a) Planning Cycle.--Section 118(a) (29 U.S.C. 2833(a)) is amended 
by striking ``5-year'' and inserting ``2-year''.
    (b) Contents.--Section 118(b) (29 U.S.C. 2833(b)) is amended--
            (1) by amending paragraph (2) to read as follows:
            ``(2) a description of the one-stop delivery system to be 
        established or designated in the local area, including a 
        description of how the local board will ensure the continuous 
        improvement of eligible providers of services through the 
        system and ensure that such providers meets the employment 
        needs of local employers and participants.'';
            (2) in paragraph (4), by striking ``and dislocated 
        worker'';
            (3) by redesignating paragraph (10) as paragraph (11); and
            (4) by inserting after paragraph (9) the following:
            ``(10) a description of the strategies and services that 
        will be initiated in the local area to engage employers, 
        including small employers, in workforce development 
        activities.''.

SEC. 108. ESTABLISHMENT OF ONE-STOP DELIVERY SYSTEMS.

    (a) One-Stop Partners.--
            (1) Required partners.--Section 121(b)(1) (29 U.S.C. 
        2841(b)(1)) is amended--
                    (A) in subparagraph (B)--
                            (i) by striking clauses (ii) and (v);
                            (ii) by redesignating clauses (iii) and 
                        (iv) as clauses (ii) and (iii), respectively, 
                        and by redesignating clauses (vi) through (xii) 
                        as clauses (iv) through (x), respectively;
                            (iii) in clause (ix) (as so redesignated), 
                        by striking ``and'';
                            (iv) in clause (x) (as so redesignated), by 
                        striking the period and inserting ``; and''; 
                        and
                            (v) by inserting after clause (x)(as so 
                        redesignated) the following:
                            ``(xi) programs authorized under part A of 
                        title IV of the Social Security Act (42 U.S.C. 
                        601 et. seq.), subject to subparagraph (C).''; 
                        and
                    (B) by adding after subparagraph (B) the following:
                    ``(C) Determination by the governor.--The program 
                referred to in clauses (xi) of subparagraph (B) shall 
                be included as a required partner for purposes of this 
                title in a State unless the Governor of the State 
                notifies the Secretary and the Secretary of Health and 
                Human Services in writing of a determination by the 
                Governor not to include such programs as required 
                partners for purposes of this title in the State.''.
            (2) Additional partners.--Section 121(b)(2)(B) (29 U.S.C. 
        2841(b)(2)(B)) is amended--
                    (A) by striking clause (i) and redesignating 
                clauses (ii) through (v) as clauses (i) through (iv) 
                respectively;
                    (B) in clause (iii) (as so redesignated) by 
                striking ``and'' at the end;
                    (C) in clause (iv) (as so redesignated) by striking 
                the period and inserting a semicolon; and
                    (D) by adding at the end the following new clauses:
                            ``(v) employment and training programs 
                        administered by the Social Security 
                        Administration, including the Ticket to Work 
                        program (established by Public Law 106-170);
                            ``(vi) employment and training programs 
                        carried out by the Small Business 
                        Administration;
                            ``(vii) programs under part D of title IV 
                        of the Social Security Act (42 U.S.C. 451 et 
                        seq.) (relating to child support enforcement); 
                        and
                            ``(viii) programs carried out in the local 
                        area for individuals with disabilities, 
                        including programs carried out by State 
                        agencies relating to mental health, mental 
                        retardation, and developmental disabilities, 
                        State Medicaid agencies, State Independent 
                        Living Councils, and Independent Living 
                        Centers.''.
    (b) Provision of Services.--Subtitle B of title I is amended--
            (1) in section 121(d)(2), by striking ``section 134(c)'' 
        and inserting ``subsection (e)'';
            (2) by striking subsection (e) of section 121;
            (3) by moving subsection (c) of section 134 from section 
        134, redesignating such subsection as subsection (e), and 
        inserting such subsection (as so redesignated) after subsection 
        (d) of section 121; and
            (4) by amending subsection (e) (as moved and redesignated 
        by paragraph (2))--
                    (A) in paragraph (1)(A), by striking ``subsection 
                (d)(2)'' and inserting ``section 134(c)(2)'';
                    (B) in paragraph (1)(B)--
                            (i) by striking ``subsection (d)'' and 
                        inserting ``section 134(c)''; and
                            (ii) by striking ``subsection (d)(4)(G)'' 
                        and inserting ``section 134(c)(4)(G)'';
                    (C) in paragraph (1)(C), by striking ``subsection 
                (e)'' and inserting ``section 134(d)'';
                    (D) in paragraph (1)(D)--
                            (i) by striking ``section 121(b)'' and 
                        inserting ``subsection (b)''; and
                            (ii) by striking ``and'' at the end; and
                    (E) by amending paragraph (1)(E) to read as 
                follows:
                    ``(E) shall provide access to the information 
                described in section 15(e) of the Wagner-Peyser Act (29 
                U.S.C. 49l-2(e)).''.
    (c) Certification and Funding of One-Stop Centers.--Section 121 (as 
amended by subsection (b)) is further amended by adding at the end the 
following new subsections:
    ``(g) Certification of One-Stop Centers.--
            ``(1) In general.--The State board shall establish 
        procedures and criteria for periodically certifying one-stop 
        center for the purpose of awarding the one-stop infrastructure 
        funding described in subsection (h).
            ``(2) Criteria.--The criteria for certification under this 
        subsection shall include minimum standards relating to the 
        scope and degree of service integration achieved by the centers 
        involving the programs provided by the one-stop partners, and 
        how the centers ensure that such providers meet the employment 
        needs of local employers and participants.
            ``(3) Effect of certification.--One-stop centers certified 
        under this subsection shall be eligible to receive the 
        infrastructure grants authorized under subsection (h).
    ``(h) One-Stop Infrastructure Funding.--
            ``(1) Partner contributions.--
                    ``(A) Provision of funds.--Notwithstanding any 
                other provision of law, as determined under 
                subparagraph (B), a portion of the Federal funds 
                provided to the State and areas within the State under 
                the Federal laws authorizing the one-stop partner 
                programs described in subsection (b)(1)(B) and 
                participating additional partner programs described in 
                (b)(2)(B) for a fiscal year shall be provided to the 
                Governor by such programs to carry out this subsection.
                    ``(B) Determination of governor.--Subject to 
                subparagraph (C), the Governor, in consultation with 
                the State board, shall determine the portion of funds 
                to be provided under subparagraph (A) by each one-stop 
                partner and in making such determination shall consider 
                the proportionate use of the one-stop centers by each 
                partner, the costs of administration for purposes not 
                related to one-stop centers for each partner, and other 
                relevant factors described in paragraph (3).
                    ``(C) Limitations.--
                            ``(i) Provision from administrative 
                        funds.--The funds provided under this paragraph 
                        by each one-stop partner shall be provided only 
                        from funds available for the costs of 
                        administration under the program administered 
                        by such partner, and shall be subject to the 
                        limitations with respect to the portion of 
                        funds under such programs that may be used for 
                        administration.
                            ``(ii) Federal direct spending programs.--
                        Programs that are Federal direct spending under 
                        section 250(c)(8) of the Balanced Budget and 
                        Emergency Deficit Control Act of 1985 (2 U.S.C. 
                        900(c)(8)) shall not, for purposes of this 
                        paragraph, be required to provide an amount in 
                        excess of the amount determined to be 
                        equivalent to the proportionate use of the one-
                        stop centers by such programs in the State.
                            ``(iii) Native american programs.--Native 
                        American programs established under section 166 
                        shall not be subject to the provisions of this 
                        subsection. The method for determining the 
                        appropriate portion of funds to be provided by 
                        such Native American programs to pay for the 
                        costs of infrastructure of a one-stop center 
                        certified under subsection (g) shall be 
                        determined as part of the development of the 
                        memorandum of understanding under subsection 
                        (c) for the one-stop center and shall be stated 
                        in the memorandum.
            ``(2) Allocation by governor.--From the funds provided 
        under paragraph (1), the Governor shall allocate funds to local 
        areas in accordance with the formula established under 
        paragraph (3) for the purposes of assisting in paying the costs 
        of the infrastructure of One-Stop centers certified under 
        subsection (g).
            ``(3) Allocation formula.--The State board shall develop a 
        formula to be used by the Governor to allocate the funds 
        described in paragraph (1). The formula shall include such 
        factors as the State board determines are appropriate, which 
        may include factors such as the number of centers in the local 
        area that have been certified, the population served by such 
        centers, and the performance of such centers.
            ``(4) Costs of infrastructure.--For purposes of this 
        subsection, the term `costs of infrastructure' means the 
        nonpersonnel costs that are necessary for the general operation 
        of a one-stop center, including the rental costs of the 
        facilities, the costs of utilities and maintenance, equipment 
        (including adaptive technology for individuals with 
        disabilities), strategic planning activities for the center, 
        and common outreach activities.
    ``(i) Other Funds.--
            ``(1) In general.--In addition to the funds provided to 
        carry out subsection (h), a portion of funds made available 
        under Federal law authorizing the one-stop partner programs 
        described in subsection (b)(1)(B) and participating partner 
        programs described in subsection (b)(2)(B), or the noncash 
        resources available under such programs shall be used to pay 
        the costs relating to the operation of the one-stop delivery 
        system that are not paid for from the funds provided under 
        subsection (h), to the extent not inconsistent with the Federal 
        law involved including--
                    ``(A) infrastructure costs that are in excess of 
                the funds provided under subsection (h);
                    ``(B) common costs that are in addition to the 
                costs of infrastructure; and
                    ``(C) the costs of the provision of core services 
                applicable to each program.
            ``(2) Determination and guidance.--The method for 
        determining the appropriate portion of funds and noncash 
        resources to be provided by each program under paragraph (1) 
        shall be determined as part of the memorandum of understanding 
        under subsection (c). The State board shall provide guidance to 
        facilitate the determination of appropriate allocation of the 
        funds and noncash resources in local areas.''.

SEC. 109. ELIGIBLE PROVIDERS OF TRAINING SERVICES.

    Section 122 (29 U.S.C. 2842) is amended to read as follows:

``SEC. 122. IDENTIFICATION OF ELIGIBLE PROVIDERS OF TRAINING SERVICES.

    ``(a) In General.--The Governor shall establish criteria and 
procedures regarding the eligibility of providers of training services 
described in section 134(c)(4) to receive funds provided under section 
133(b) for the provision of such training services.
    ``(b) Criteria.--
            ``(1) In general.--The criteria established pursuant to 
        subsection (a) shall take into account the performance of 
        providers of training services with respect to the indicators 
        described in section 136 or other appropriate indicators 
        (taking into consideration the characteristics of the 
        population served and relevant economic conditions), and such 
        other factors as the Governor determines are appropriate to 
        ensure the quality of services, the accountability of 
        providers, how the centers ensure that such providers meet the 
        needs of local employers and participants, and the informed 
        choice of participants under chapter 5. Such criteria shall 
        require that the provider submit appropriate, accurate and 
        timely information to the State for purposes of carrying out 
        subsection (d). The criteria shall also provide for periodic 
        review and renewal of eligibility under this section for 
        providers of training services. The Governor may authorize 
        local areas in the State to establish additional criteria or to 
        modify the criteria established by the Governor under this 
        section for purposes of determining the eligibility of 
        providers of training services to provide such services in the 
        local area.
            ``(2) Limitation.--In carrying out the requirements of this 
        subsection, no personally identifiable information regarding a 
        student, including Social Security number, student 
        identification number, or other identifier, may be disclosed 
        without the prior written consent of the parent or eligible 
        student in compliance with section 444 of the General Education 
        Provisions Act (20 U.S.C. 1232g).
    ``(c) Procedures.--The procedures established under subsection (a) 
shall identify the application process for a provider of training 
services to become eligible to receive funds under section 133(b) for 
the provision of training services, and identify the respective roles 
of the State and local areas in receiving and reviewing applications 
and in making determinations of eligibility based on the criteria 
established under this section. The procedures shall also establish a 
process for a provider of training services to appeal a denial or 
termination of eligibility under this section that includes an 
opportunity for a hearing and prescribes appropriate time limits to 
ensure prompt resolution of the appeal.
    ``(d) Information to Assist Participants in Choosing Providers.--
            ``(1) In general.--In order to facilitate and assist 
        participants under chapter 5 in choosing providers of training 
        services, the Governor shall ensure that an appropriate list or 
        lists of providers determined eligible under this section in 
        the State, accompanied by such information as the Governor 
        determines is appropriate, is provided to the local boards in 
        the State to be made available to such participants and to 
        members of the public through the one-stop delivery system in 
        the State.
            ``(2) Special rule.--An entity that carries out programs 
        under the Act of August 16, 1937 (commonly known as the 
        `National Apprenticeship Act', 50 Stat. 664, chapter 663; 29 
        U.S.C. 50 et seq.) shall be included on the list of eligible 
        providers described in paragraph (1) for so long as such entity 
        remains certified by the Department of Labor.
    ``(e) Agreements With Other States.--States may enter into 
agreements, on a reciprocal basis, to permit eligible providers of 
training services to accept individual training accounts provided in 
another State.
    ``(f) Recommendations.--In developing the criteria, procedures, and 
information required under this section, the Governor shall solicit and 
take into consideration the recommendations of local boards and 
providers of training services within the State.
    ``(g) Opportunity to Submit Comments.--During the development of 
the criteria, procedures, and information required under this section, 
the Governor shall provide an opportunity for interested members of the 
public, including representatives of business and labor organizations, 
to submit comments regarding such criteria, procedures, and 
information.
    ``(h) On-the-Job Training or Customized Training Exception.--
            ``(1) In general.--Providers of on-the-job training or 
        customized training shall not be subject to the requirements of 
        subsections (a) through (g).
            ``(2) Collection and dissemination of information.--A one-
        stop operator in a local area shall collect such performance 
        information from on-the-job training and customized training 
        providers as the Governor may require, determine whether the 
        providers meet such performance criteria as the Governor may 
        require, and disseminate information identifying providers that 
        meet the criteria as eligible providers, and the performance 
        information, through the one-stop delivery system. Providers 
        determined to meet the criteria shall be considered to be 
        identified as eligible providers of training services.''.

SEC. 110. ELIGIBLE PROVIDERS OF YOUTH ACTIVITIES.

    (a) Eligible Providers of Youth Activities.--Section 123 (29 U.S.C. 
2843) is amended to read as follows:

``SEC. 123. ELIGIBLE PROVIDERS OF YOUTH ACTIVITIES.

    ``(a) In General.--From the funds allocated under section 128(b) to 
a local area, the local board for such area shall award grants or 
contracts on a competitive basis to providers of youth activities 
identified based on the criteria in the State plan and shall conduct 
oversight with respect to such providers.
    ``(b) Exceptions.--A local board may award grants or contracts on a 
sole-source basis if such board determines there are an insufficient 
number of eligible providers of training services in the local area 
involved (such as rural areas) for grants to be awarded on a 
competitive basis under subsection (a).''.
    (b) Clerical Amendment.--The table of contents in section 1(b) is 
amended by amending the item related to section 123 to read as follows:

``Sec. 123. Eligible providers of youth activities.''.

SEC. 111. YOUTH ACTIVITIES.

    (a) State Allotments.--
            (1) In general.--Section 127(a) (29 U.S.C. 2852(a)) is 
        amended to read as follows:
    ``(a) Allotment Among States.--
            ``(1) Youth activities.--
                    ``(A) Youth challenge grants.--
                            ``(i) Reservation of funds.--Of the amount 
                        appropriated under section 137(a) for each 
                        fiscal year, the Secretary shall reserve 25 
                        percent to provide youth challenge grants under 
                        section 169.
                            ``(ii) Limitation.--Notwithstanding clause 
                        (i), if the amount appropriated under section 
                        137(a) for a fiscal year exceeds 
                        $1,000,000,000, the Secretary shall reserve 
                        $250,000,000 to provide youth challenge grants 
                        under section 169.
                    ``(B) Outlying areas and native americans.--
                            ``(i) In general.--After determining the 
                        amount to be reserved under subparagraph (A), 
                        of the remainder of the amount appropriated 
                        under section 137(a) for each fiscal year the 
                        Secretary shall--
                                    ``(I) reserve not more than \1/4\ 
                                of one percent of such amount to 
                                provide assistance to the outlying 
                                areas to carry out youth activities and 
                                statewide workforce investment 
                                activities; and
                                    ``(II) reserve not more than 1 and 
                                \1/2\ percent of such amount to provide 
                                youth activities under section 166 
                                (relating to Native Americans).
                            ``(ii) Restriction.--The Republic of Palau 
                        shall cease to be eligible to receive funding 
                        under this subparagraph upon entering into an 
                        agreement for extension of United States 
                        educational assistance under the Compact of 
                        Free Association (approved by the Compact of 
                        Free Association Amendments Act of 2003 (Public 
                        Law 108-188)) after the date of enactment of 
                        the Job Training Improvement Act of 2005.
                    ``(C) States.--
                            ``(i) In general.--Of the remainder of the 
                        amount appropriated under section 137(a) for a 
                        fiscal year that is available after determining 
                        the amounts to be reserved under subparagraphs 
                        (A) and (B), the Secretary shall allot--
                                    ``(I) the amount of the remainder 
                                that is less than or equal to the total 
                                amount that was allotted to States for 
                                fiscal year 2003 under section 
                                127(b)(1)(C) of this Act (as in effect 
                                on the day before the date of enactment 
                                of the Job Training Improvement Act of 
                                2005) in accordance with the 
                                requirements of such section 
                                127(b)(1)(C); and
                                    ``(II) the amount of the remainder, 
                                if any, in excess of the amount 
                                referred to in subclause (I) in 
                                accordance with clause (ii).
                            ``(ii) Formulas for excess funds.--Subject 
                        to clauses (iii) and (iv), of the amounts 
                        described in clause (i)(II)--
                                    ``(I) 33\1/3\ percent shall be 
                                allotted on the basis of the relative 
                                number of individuals in the civilian 
                                labor force who are ages 16-19 in each 
                                State, compared to the total number of 
                                individuals in the civilian labor force 
                                who are ages 16-19 in all States;
                                    ``(II) 33\1/3\ percent shall be 
                                allotted on the basis of the relative 
                                number of unemployed individuals in 
                                each State, compared to the total 
                                number of unemployed individuals in all 
                                States; and
                                    ``(III) 33\1/3\ percent shall be 
                                allotted on the basis of the relative 
                                number of disadvantaged youth who are 
                                ages 16 through 21 in each State, 
                                compared to the total number of 
                                disadvantaged youth who are ages 16 
                                through 21 in all States.
                            ``(iii) Minimum and maximum percentages.--
                        The Secretary shall ensure that no State shall 
                        receive an allotment for a fiscal year that is 
                        less than 90 percent or greater than 130 
                        percent of the allotment percentage of that 
                        State for the preceding fiscal year.
                            ``(iv) Small state minimum allotment.--
                        Subject to clause (iii), the Secretary shall 
                        ensure that no State shall receive an allotment 
                        under this paragraph that is less than \3/10\ 
                        of 1 percent of the amount available under 
                        subparagraph (A).
            ``(2) Definitions.--For the purposes of paragraph (1), the 
        following definitions apply:
                    ``(A) Allotment percentage.--The term `allotment 
                percentage', used with respect to fiscal year 2006 or a 
                subsequent fiscal year, means a percentage of the 
                remainder described in paragraph (1)(C)(i) that is 
                received through an allotment made under this 
                subsection for the fiscal year. The term, with respect 
                to fiscal year 2005, means the percentage of the 
                amounts allotted to States under this chapter (as in 
                effect on the day before the date of enactment of the 
                Job Training Improvement Act of 2005) that is received 
                by the State involved for fiscal year 2005.
                    ``(B) Disadvantaged youth.--The term `disadvantaged 
                youth' means an individual who is age 16 through 21 who 
                received an income, or is a member of a family that 
                received a total family income, that, in relation to 
                family size, does not exceed the poverty line.
            ``(3) Special rule.--For purposes of the formulas specified 
        in paragraph (1)(C), the Secretary shall, as appropriate and to 
        the extent practicable, exclude college students and members of 
        the Armed Forces from the determination of the number of 
        disadvantaged youth.''.
            (2) Reallotment.--Section 127 (29 U.S.C. 2552) is further 
        amended---
                    (A) by striking subsection (b);
                    (B) by redesignating subsection (c) as subsection 
                (b);
                    (C) in subsection (b) (as so redesignated)--
                            (i) by amending paragraph (2) to read as 
                        follows:
            ``(2) Amount.--The amount available for reallotment for a 
        program year is equal to the amount by which the unexpended 
        balance at the end of the program year prior to the program 
        year for which the determination is made exceeds 30 percent of 
        the total amount of funds available to the State under this 
        section during such prior program year (including amounts 
        allotted to the State in all prior program years that remained 
        available). For purposes of this paragraph, the expended 
        balance is the amount that is the difference between--
                    ``(A) the total amount of funds available to the 
                State under this section during the program year prior 
                to the program year for which the determination is made 
                (including amounts allotted to the State in all prior 
                program years that remained available); and
                    ``(B) the accrued expenditures during such prior 
                program year.'';
                            (ii) in paragraph (3)--
                                    (I) by striking ``for the prior 
                                program year'' and inserting ``for the 
                                program year in which the determination 
                                is made''; and
                                    (II) by striking ``such prior 
                                program year'' and inserting ``such 
                                program year'';
                            (iii) by amending paragraph (4) to read as 
                        follows:
            ``(4) Eligibility.--For purposes of this subsection, an 
        eligible State means a State which does not have an amount 
        available for reallotment under paragraph (2) for the program 
        year for which the determination under paragraph (2) is 
        made.''; and
                            (iv) in paragraph (5), by striking 
                        ``obligation'' and inserting ``accrued 
                        expenditure''.
    (b) Within State Allocations.--
            (1) Reservation for statewide activities.--Section 128(a) 
        is amended to read as follows:
    ``(a) Reservation for Statewide Activities.--
            ``(1) In general.--The Governor of a State shall reserve 
        not more than 10 percent of the amount allotted to the State 
        under section 127(a)(1)(C) for a fiscal year for statewide 
        activities.
            ``(2) Use of funds.--Regardless of whether the amounts are 
        allotted under section 127(a)(1)(C) and reserved under 
        paragraph (1) or allotted under section 132 and reserved under 
        section 133(a), the Governor may use the reserved amounts to 
        carry out statewide youth activities under section 129(b) or 
        statewide employment and training activities under section 
        133.''.
            (2) Within state allocations.--Section 128(b) is amended to 
        read as follows:
    ``(b) Within State Allocation.--
            ``(1) In general.--Of the amounts allotted to the State 
        under section 127(a)(1)(C) and not reserved under subsection 
        (a)(1)--
                    ``(A) 80 percent of such amounts shall be allocated 
                by the Governor to local areas in accordance with 
                paragraph (2); and
                    ``(B) 20 percent of such amounts shall be allocated 
                by the Governor to local areas in accordance with 
                paragraph (3).
            ``(2) Established formula.--
                    ``(A) In general.--Of the amounts described in 
                paragraph (1)(A), the Governor shall allocate--
                            ``(i) 33\1/3\ percent shall be allotted on 
                        the basis of the relative number of individuals 
                        in the civilian labor force who are ages 16-19 
                        in each local area, compared to the total 
                        number of individuals in the civilian labor 
                        force who are ages 16-19 in all local areas in 
                        the State;
                            ``(ii) 33\1/3\ percent shall be allotted on 
                        the basis of the relative number of unemployed 
                        individuals in each local area, compared to the 
                        total number of unemployed individuals in all 
                        local areas in the State; and
                            ``(iii) 33\1/3\ percent on the basis of the 
                        relative number of disadvantaged youth who are 
                        ages 16 through 21 in each local area, compared 
                        to the total number of disadvantaged youth who 
                        are ages 16 through 21 in all local areas in 
                        the State.
                    ``(B) Minimum and maximum percentages.--The 
                Governor shall ensure that no local area shall receive 
                an allocation for a fiscal year under this paragraph 
                that is less than 90 percent or greater than 130 
                percent of the allocation percentage of the local area 
                for the preceding fiscal year.
                    ``(C) Definitions.--
                            ``(i) Allocation percentage.--For purposes 
                        of this paragraph, the term `allocation 
                        percentage', used with respect to fiscal year 
                        2006 or a subsequent fiscal year, means a 
                        percentage of amount described in 
                        paragraph(1)(A) that is received through an 
                        allocation made under this paragraph for the 
                        fiscal year. The term, with respect to fiscal 
                        year 2005, means the percentage of the amounts 
                        allocated to local areas under this chapter (as 
                        in effect on the day before the date of 
                        enactment of the Job Training Improvement Act 
                        of 2005) that is received by the local area 
                        involved for fiscal year 2005.
                            ``(ii) Disadvantaged youth.--The term 
                        `disadvantaged youth' means an individual who 
                        is age 16 through 21 who received an income, or 
                        is a member of a family that received a total 
                        family income, that, in relation to family 
                        size, does not exceed the poverty line.
            ``(3) Youth discretionary allocation.--The Governor shall 
        allocate to local areas the amounts described in paragraph 
        (1)(B) in accordance with such demographic and economic factors 
        as the Governor, after consultation with the State board and 
        local boards, determines are appropriate.
            ``(4) Local administrative cost limit.--
                    ``(A) In general.--Of the amounts allocated to a 
                local area under this subsection and section 133(b) for 
                a fiscal year, not more than 10 percent of the amount 
                may be used by the local boards for the administrative 
                costs of carrying out local workforce investment 
                activities under this chapter or chapter 5.
                    ``(B) Use of funds.--Funds made available for 
                administrative costs under subparagraph (A) may be used 
                for the administrative costs of any of the local 
                workforce investment activities described in this 
                chapter or chapter 5, regardless of whether the funds 
                were allocated under this subsection or section 
                133(b).''.
            (3) Reallocation.--Section 128(c) (29 U.S.C. 2853(c)) is 
        amended--
                    (A) in paragraph (1), by striking ``paragraph 
                (2)(A) or (3) of'';
                    (B) by amending paragraph (2) to read as follows:
            ``(2) Amount.--The amount available for reallocation for a 
        program year is equal to the amount by which the unexpended 
        balance at the end of the program year prior to the program 
        year for which the determination is made exceeds 30 percent of 
        the total amount of funds available to the local area under 
        this section during such prior program year, (including amounts 
        allotted to the local area in prior program years that remain 
        available). For purposes of this paragraph, the unexpended 
        balance is the amount that is the difference between--
                    ``(A) the total amount of funds available to the 
                local area under this section during the program year 
                prior to the program year for which the determination 
                is made (including amounts allocated to the local area 
                in all prior program years that remained available); 
                and
                    ``(B) the accrued expenditures during such prior 
                program year.'';
                    (C) by amending paragraph (3)--
                            (i) by striking ``subsection (b)(3)'' each 
                        place it appears and inserting ``subsection 
                        (b)'';
                            (ii) by striking ``the prior program year'' 
                        and inserting ``the program year in which the 
                        determination is made'';
                            (iii) by striking ``such prior program 
                        year'' and inserting ``such program year''; and
                            (iv) by striking the last sentence; and (D) 
                        by amending paragraph (4) to read as follows:
            ``(4) Eligibility.--For purposes of this subsection, an 
        eligible local area means a local area which does not have an 
        amount available for reallocation under paragraph (2) for the 
        program year for which the determination under paragraph (2) is 
        made.''.
    (c) Youth Participant Eligibility.--Section 129(a) (29 U.S.C. 
2854(a)) is amended to read as follows:
    ``(a) Youth Participant Eligibility.--
            ``(1) In general.--The individuals participating in 
        activities carried out under this chapter by a local area 
        during any program year shall be individuals who, at the time 
        the eligibility determination is made, are--
                    ``(A) not younger than age 16 or older than age 24; 
                and
                    ``(B) one or more of the following:
                            ``(i) school dropouts;
                            ``(ii) recipients of a secondary school 
                        diploma or General Educational Development 
                        credential (GED) (including recognized 
                        alternative standards for individuals with 
                        disabilities) who are deficient in basic 
                        skills;
                            ``(iii) court-involved youth attending an 
                        alternative school;
                            ``(iv) youth in foster care or who have 
                        been in foster care; or
                            ``(v) in school youth who are low-income 
                        individuals and one or more of the following:
                                    ``(I) Deficient in literacy skills.
                                    ``(II) Homeless, runaway, or foster 
                                children.
                                    ``(III) Pregnant or parents.
                                    ``(IV) Offenders.
                                    ``(V) Individuals who require 
                                additional assistance to complete an 
                                educational program, or to secure and 
                                hold employment.
            ``(2) Priority for school dropouts.--A priority in the 
        provision of services under this chapter shall be given to 
        individuals who are school dropouts.
            ``(3) Limitations on activities for in-school youth.--
                    ``(A) Percentage of funds.--For any program year, 
                not more than 30 percent of the funds available for 
                statewide activities under subsection (b), and not more 
                than 30 percent of funds available to local areas under 
                subsection (c), may be used to provide activities for 
                in-school youth meeting the requirements of paragraph 
                (1)(B)(v).
                    ``(B) Non-school hours required.--Activities 
                carried out under this chapter for in-school youth 
                meeting the requirements of paragraph (1)(B)(v) shall 
                only be carried out in non-school hours or periods when 
                school is not in session (such as before and after 
                school or during summer recess).''.
    (d) Statewide Youth Activities.--Section 129(b) (29 U.S.C. 2854(b)) 
is amended to read as follows:
    ``(b) Statewide Activities.--
            ``(1) In general.--Funds reserved by a Governor for a State 
        as described in sections 128(a) and 133(a)(1) may be used for 
        statewide activities including--
                    ``(A) additional assistance to local areas that 
                have high concentrations of eligible youth;
                    ``(B) supporting the provision of core services 
                described in section 134(c)(2) in the one-stop delivery 
                system;
                    ``(C) conducting evaluations under section 136(e) 
                of activities authorized under this chapter and chapter 
                5 in coordination with evaluations carried out by the 
                Secretary under section 172, research, and 
                demonstration projects;
                    ``(D) providing incentive grants to local areas for 
                regional cooperation among local boards (including 
                local boards in a designated region as described in 
                section 116(c)), for local coordination of activities 
                carried out under this Act, and for exemplary 
                performance by local areas on the local performance 
                measures;
                    ``(E) providing technical assistance and capacity 
                building to local areas, one-stop operators, one-stop 
                partners, and eligible providers, including the 
                development and training of staff, the development of 
                exemplary program activities, and the provision of 
                technical assistance to local areas that fail to meet 
                local performance measures;
                    ``(F) operating a fiscal and management 
                accountability system under section 136(f); and
                    ``(G) carrying out monitoring and oversight of 
                activities under this chapter and chapter 5.
            ``(2) Limitation.--Not more than 5 percent of the funds 
        allotted under section 127(b) shall be used by the State for 
        administrative activities carried out under this subsection and 
        section 133(a).
            ``(3) Prohibition.--No funds described in this subsection 
        or in section 134(a) may be used to develop or implement 
        education curricula for school systems in the State.''.
    (e) Local Elements and Requirements.--
            (1) Program design.--Section 129(c)(1) (29 U.S.C. 2854(c) 
        (1)) is amended--
                    (A) in the matter preceding subparagraph (A), by 
                striking ``paragraph (2)(A) or (3), as appropriate, 
                of'';
                    (B) in subparagraph (B), by inserting ``are 
                directly linked to one or more of the performance 
                outcomes relating to this chapter under section 136, 
                and that'' after ``for each participant that''; and
                    (C) in subparagraph (C)--
                            (i) by redesignating clauses (i) through 
                        (iv) as clauses (ii) through (v), respectively;
                            (ii) by inserting before clause (ii) (as so 
                        redesignated) the following:
    ``(i) activities leading to the attainment of a secondary school 
diploma or the General Educational Development credential (GED) 
(including recognized alternative standards for individuals with 
disabilities);'';
                            (iii) in clause (ii) (as so redesignated), 
                        by inserting ``and advanced training'' after 
                        ``opportunities'';
                            (iv) in clause (iii) (as so redesignated), 
                        by inserting ``that lead to the attainment of 
                        recognized credentials'' after ``learning''; 
                        and
                            (v) by amending clause (v) (as redesignated 
                        by this subparagraph) to read as follows:
    ``(v) effective connections to employers in sectors of the local 
labor market experiencing high growth in employment opportunities.''.
            (2) Program elements.--Section 129(c)(2) (29 U.S.C. 
        2854(c)(2)) is amended--
                    (A) in subparagraph (A), by striking ``secondary 
                school, including dropout prevention strategies'' and 
                inserting ``secondary school diploma or the General 
                Educational Development credential (GED) (including 
                recognized alternative standards for individuals with 
                disabilities), including dropout prevention 
                strategies'';
                    (B) in subparagraph (I), by striking ``and'' at the 
                end;
                    (C) in subparagraph (J), by striking the period at 
                the end and inserting a semicolon; and
                    (D) by adding at the end the following:
                    ``(K) on-the-job training opportunities; and
                    ``(L) financial literacy skills.''.
            (3) Additional requirements.--Section 129(c)(3)(A) (29 
        U.S.C. 2854(c)(3)(A)) is amended in the matter preceding clause 
        (i) by striking ``or applicant who meets the minimum income 
        criteria to be considered an eligible youth''.
            (4) Priority and exceptions.--Section 129(c) (29 U.S.C. 
        2854(c)) is further amended--
                    (A) by striking paragraphs (4) and (5);
                    (B) by redesignating paragraph (6) as paragraph 
                (4);
                    (C) by redesignating paragraph (7) as paragraph 
                (5), and in such redesignated paragraph (5) by striking 
                ``youth councils'' and inserting ``local boards''; and
                    (D) by redesignating paragraph (8) as paragraph 
                (6).

SEC. 112. COMPREHENSIVE PROGRAMS FOR ADULTS.

    (a) Title Amendment.--
            (1) The title heading of chapter 5 is amended to read as 
        follows:

   ``CHAPTER 5--COMPREHENSIVE EMPLOYMENT AND TRAINING ACTIVITIES FOR 
                               ADULTS''.

            (2) Clerical amendment.--The table of contents in section 
        1(b) is amended by amending the item related to the heading for 
        chapter 5 to read as follows:

``Chapter 5--Comprehensive Employment and Training Activities for 
                            Adults.''.
    (b) General Authorization.--Section 131 (29 U.S.C. 2861) is 
amended--
            (1) by striking ``paragraphs (1)(B) and (2)(B)of''; and
            (2) by striking ``, and dislocated workers,''.
    (c) State Allotments.--
            (1) In general.--Section 132(a) (29 U.S.C. 2862(a)) is 
        amended to read as follows:
    ``(a) In General.--The Secretary shall--
            ``(1) reserve 10 percent of the amount appropriated under 
        section 137(b) for a fiscal year, of which--
                    ``(A) not less than 75 percent shall be used for 
                national dislocated worker grants under section 173;
                    ``(B) not more than 20 percent may be used for 
                demonstration projects under section 171; and
                    ``(C) not more than 5 percent may be used to 
                provide technical assistance under section 170; and
            ``(2) make allotments from 90 percent of the amount 
        appropriated under section 137(b) for a fiscal year in 
        accordance with subsection (b).''.
            (2) Allotment among states.--Section 132(b) (29 U.S.C. 
        2862(b)) is amended to read as follows:
    ``(b) Allotment Among States for Adult Employment and Training 
Activities.--
            ``(1) Reservation for outlying areas.--
                    ``(A) In general.--From the amount made available 
                under subsection (a)(2) for a fiscal year, the 
                Secretary shall reserve not more than \1/4\ of 1 
                percent to provide assistance to outlying areas to 
                carry out employment and training activities for adults 
                and statewide workforce investment activities.
                    ``(B) Restriction.--The Republic of Palau shall 
                cease to be eligible to receive funding under this 
                paragraph upon entering into an agreement for extension 
                of United States educational assistance under the 
                Compact of Free Association (approved by the Compact of 
                Free Association Amendments Act of 2003 (Public Law 
                108-188)) after the date of enactment of the Job 
                Training Improvement Act of 2005.
            ``(2) States.--Subject to paragraph (5), of the remainder 
        of the amount referred to under subsection (a)(2) for a fiscal 
        year that is available after determining the amount to be 
        reserved under paragraph (1), the Secretary shall allot to the 
        States for employment and training activities for adults and 
        for statewide workforce investment activities--
                    ``(A) 26 percent in accordance with paragraph (3); 
                and
                    ``(B) 74 percent in accordance with paragraph (4).
            ``(3) Base formula.--
                    ``(A) Fiscal year 2006.--
                            ``(i) In general.--Subject to clause (ii), 
                        the amount referred to in paragraph (2)(A) 
                        shall be allotted for fiscal year 2006 on the 
                        basis of allotment percentage of each State 
                        under section 6 of the Wagner-Peyser Act for 
                        fiscal year 2005.
                            ``(ii) Excess amounts.--If the amount 
                        referred to in paragraph (2)(A) for fiscal year 
                        2006 exceeds the amount that was available for 
                        allotment to the States under the Wagner-Peyser 
                        Act for fiscal year 2005, such excess amount 
                        shall be allotted on the basis of the relative 
                        number of individuals in the civilian labor 
                        force in each State, compared to the total 
                        number of individuals in the civilian labor 
                        force in all States, adjusted to ensure that no 
                        State receives less than \3/10\ of one percent 
                        of such excess amount.
                            ``(iii) Definition.--For purposes of this 
                        subparagraph, the term `allotment percentage' 
                        means the percentage of the amounts allotted to 
                        States under section 6 of the Wagner-Peyser Act 
                        that is received by the State involved for 
                        fiscal year 2005.
                    ``(B) Fiscal years 2007 and thereafter.--
                            ``(i) In general.--Subject to clause (ii), 
                        the amount referred to in paragraph(2)(A) shall 
                        be allotted for fiscal year 2007 and each 
                        fiscal year thereafter on the basis of the 
                        allotment percentage of each State under this 
                        paragraph for the preceding fiscal year.
                            ``(ii) Excess amounts.--If the amount 
                        referred to in paragraph (2)(A) for fiscal year 
                        2007 or any fiscal year thereafter exceeds the 
                        amount that was available for allotment under 
                        this paragraph for the prior fiscal year, such 
                        excess amount shall be allotted on the basis of 
                        the relative number of individuals in the 
                        civilian labor force in each State, compared to 
                        the total number of individuals in the civilian 
                        labor force in all States, adjusted to ensure 
                        that no State receives less than \3/10\ of one 
                        percent of such excess amount.
                            ``(iii) Definition.--For purposes of this 
                        subparagraph, the term `allotment percentage' 
                        means the percentage of the amounts allotted to 
                        States under this paragraph in a fiscal year 
                        that is received by the State involved for such 
                        fiscal year.
            ``(4) Consolidated formula.--
                    ``(A) In general.--Subject to subparagraphs (B) and 
                (C), of the amount referred to in paragraph (2)(B)--
                            ``(i) 60 percent shall be allotted on the 
                        basis of the relative number of unemployed 
                        individuals in each State, compared to the 
                        total number of unemployed individuals in all 
                        States;
                            ``(ii) 25 percent shall be allotted on the 
                        basis of the relative excess number of 
                        unemployed individuals in each State, compared 
                        to the total excess number of unemployed 
                        individuals in all States; and
                            ``(iii) 15 percent shall be allotted on the 
                        basis of the relative number of disadvantaged 
                        adults in each State, compared to the total 
                        number of disadvantaged adults in all States.
                    ``(B) Minimum and maximum percentages.--
                            ``(i) Minimum percentage.--The Secretary 
                        shall ensure that no State shall receive an 
                        allotment under this paragraph for a fiscal 
                        year that is less than 90 percent of the 
                        allotment percentage of the State under this 
                        paragraph for the preceding fiscal year.
                            ``(ii) Maximum percentage.--Subject to 
                        clause (i), the Secretary shall ensure that no 
                        State shall receive an allotment for a fiscal 
                        year under this paragraph that is more than 130 
                        percent of the allotment of the State under 
                        this paragraph for the preceding fiscal year.
                    ``(C) Small state minimum allotment.--Subject to 
                subparagraph (B), the Secretary shall ensure that no 
                State shall receive an allotment under this paragraph 
                that is less than \2/10\ of 1 percent of the amount 
                available under subparagraph (A).
                    ``(D) Definitions.--For the purposes of this 
                paragraph:
                            ``(i) Allotment percentage.--The term 
                        `allotment percentage', used with respect to 
                        fiscal year 2006 or a subsequent fiscal year, 
                        means a percentage of the amounts described in 
                        paragraph (2)(B) that is received through an 
                        allotment made under this paragraph for the 
                        fiscal year. The term, with respect to fiscal 
                        year 2005, means the percentage of the amounts 
                        allotted to States under this chapter (as in 
                        effect on the day before the date of enactment 
                        of the Job Training Improvement Act of 2005) 
                        and under reemployment service grants received 
                        by the State involved for fiscal year 2005.
                            ``(ii) Disadvantaged adult.--The term 
                        `disadvantaged adult' means an individual who 
                        is age 22 through 72 who received an income, or 
                        is a member of a family that received a total 
                        family income, that, in relation to family 
                        size, does not exceed the poverty line.
                            ``(iii) Excess number.--The term `excess 
                        number' means, used with respect to the excess 
                        number of unemployed individuals within a 
                        State, the number that represents the number of 
                        unemployed individuals in excess of 4\1/2\ 
                        percent of the civilian labor force in the 
                        State.
            ``(5) Adjustments in allotments based on differences with 
        unconsolidated formulas.--
                    ``(A) In general.--The Secretary shall ensure that 
                for any fiscal year no State has an allotment 
                difference, as defined in subparagraph (C), that is 
                less than zero. The Secretary shall adjust the amounts 
                allotted to the States under this subsection in 
                accordance with subparagraph (B) if necessary to carry 
                out this subparagraph..
                    ``(B) Adjustments in allotments.--
                            ``(i) Redistribution of excess amounts.--
                                    ``(I) In general.--If necessary to 
                                carry out subparagraph (A), the 
                                Secretary shall reduce the amounts that 
                                would be allotted under paragraphs (3) 
                                and (4) to States that have an excess 
                                allotment difference, as defined in 
                                subclause (II), by the amount of such 
                                excess, and use such amounts to 
                                increase the allotments to States that 
                                have an allotment difference less than 
                                zero.
                                    ``(II) Excess amounts.--For 
                                purposes of subclause (I), the term 
                                `excess' allotment difference means an 
                                allotment difference for a State that 
                                is--
                                            ``(aa) in excess of 3 
                                        percent of the amount described 
                                        in subparagraph (C)(i)(II); or
                                            ``(bb) in excess of a 
                                        percentage established by the 
                                        Secretary that is greater than 
                                        3 percent of the amount 
                                        described in subparagraph 
                                        (C)(i)(II) if the Secretary 
                                        determines that such greater 
                                        percentage is sufficient to 
                                        carry out subparagraph (A).
                            ``(ii) Use of amounts available under 
                        national reserve account.--If the funds 
                        available under clause (i) are insufficient to 
                        carry out subparagraph (A), the Secretary shall 
                        use funds reserved under section 132(a) in such 
                        amounts as are necessary to increase the 
                        allotments to States to meet the requirements 
                        of subparagraph (A). Such funds shall be used 
                        in the same manner as the States use the other 
                        funds allotted under this subsection.
                    ``(C) Definition of allotment difference.--
                            ``(i) In general.--For purposes of this 
                        paragraph, the term `allotment difference' 
                        means the difference between--
                                    ``(I) the total amount a State 
                                would receive of the amounts available 
                                for allotment under subsection (b)(2) 
                                for a fiscal year pursuant to 
                                paragraphs (3) and (4); and
                                    ``(II) the total amount the State 
                                would receive of the amounts available 
                                for allotment under subsection (b)(2) 
                                for the fiscal year if such amounts 
                                were allotted pursuant to the 
                                unconsolidated formulas (applied as 
                                described in clause (iii)) that were 
                                used in allotting funds for fiscal year 
                                2005.
                            ``(ii) Unconsolidated formulas.--For 
                        purposes of clause (i), the unconsolidated 
                        formulas are:
                                    ``(I) The requirements for the 
                                allotment of funds to the States 
                                contained in section 132(b)(1)(B) of 
                                this Act (as in effect on the day 
                                before the date of enactment of the Job 
                                Training Improvement Act of 2005) that 
                                were applicable to the allotment of 
                                funds under such section for fiscal 
                                year 2005.
                                    ``(II) The requirements for the 
                                allotment of funds to the States 
                                contained in section 132(b)(2)(B) of 
                                this Act (as in effect on the day 
                                before the date of enactment of the Job 
                                Training Improvement Act of 2005) that 
                                were applicable to the allotment of 
                                funds under such section for fiscal 
                                year 2005.
                                    ``(III) The requirements for the 
                                allotment of funds to the States that 
                                were contained in section 6 of the 
                                Wagner-Peyser Act (as in effect on the 
                                day before the date of enactment of the 
                                Job Training Improvement Act of 2005) 
                                that were applicable to the allotment 
                                of funds under such Act for fiscal year 
                                2005.
                                    ``(IV) The requirements for the 
                                allotment of funds to the States that 
                                were established by the Secretary for 
                                Reemployment Services Grants that were 
                                applicable to the allotment of funds 
                                for such grants for fiscal year 2005.
                            ``(iii) Proportionate application of 
                        unconsolidated formulas based on fiscal year 
                        2005.--In calculating the amount under clause 
                        (i)(II), each of the unconsolidated formulas 
                        identified in clause (ii) shall be applied, 
                        respectively, only to the proportionate share 
                        of the total amount of funds available for 
                        allotment under subsection (b)(2) for a fiscal 
                        year that is equal to the proportionate share 
                        to which each of the unconsolidated formulas 
                        applied with respect to the total amount of 
                        funds allotted to the States under all of the 
                        unconsolidated formulas in fiscal year 2005.
                            ``(iv) Rule of construction.--The amounts 
                        used to adjust the allotments to a State under 
                        subparagraph (B) for a fiscal year shall not be 
                        included in the calculation of the amounts 
                        under clause (i) for a subsequent fiscal year, 
                        including the calculation of allocation 
                        percentages for a preceding fiscal year 
                        applicable to paragraphs (3) and (4) and to the 
                        unconsolidated formulas described in clause 
                        (ii).''.
            (3) Reallotment.--Section 132(c) (29 U.S.C. 2862(c)) is 
        amended--
                    (A) by amending paragraph (2) to read as follows:
            ``(2) Amount.--The amount available for reallotment for a 
        program year is equal to the amount by which the unexpended 
        balance at the end of the program year prior to the program 
        year for which the determination is made exceeds 30 percent of 
        the total amount of funds available to the State under this 
        section during such prior program year (including amounts 
        allotted to the State in all prior program years that remained 
        available). For purposes of this paragraph, the expended 
        balance is the amount that is the difference between--
                    ``(A) the total amount of funds available to the 
                State under this section during the program year prior 
                to the program year for which the determination is made 
                (including amounts allotted to the State in all prior 
                program years that remained available); and
                    ``(B) the accrued expenditures during such prior 
                program year.'';
                    (B) in paragraph (3)--
                            (i) by striking ``for the prior program 
                        year'' and inserting ``for the program year in 
                        which the determination is made''; and
                            (ii) by striking ``such prior program 
                        year'' and inserting ``such program year''; and
                    (C) by amending paragraph (4) to read as follows:
            ``(4) Eligibility.--For purposes of this subsection, an 
        eligible State means a State that does not have an amount 
        available for reallotment under paragraph (2) for the program 
        year for which the determination under paragraph (2) is 
        made.'';
                    (D) in paragraph (5), by striking ``obligation'' 
                and inserting ``accrued expenditure''.
    (d) Within State Allocations.--
            (1) Reservation for state activities.--Section 133(a) (29 
        U.S.C. 2863(a)) is amended to read as follows:
    ``(a) Reservation for Statewide Activities.--The Governor of a 
State may reserve up to 50 percent of the total amount allotted to the 
State under section 132 for a fiscal year to carry out the statewide 
activities described in section 134(a).''.
            (2) Allocations to local areas.--Section 133(b) (29 U.S.C. 
        2863(b)) is amended to read as follows:
    ``(b) Allocations to Local Areas.--
            ``(1) In general.--Of the amounts allotted to the State 
        under section 132(b)(2) and not reserved under subsection (a)--
                    ``(A) 85 percent of such amounts shall be allocated 
                by the Governor to local areas in accordance with 
                paragraph (2); and
                    ``(B) 15 percent of such amounts shall be allocated 
                by the Governor to local areas in accordance with 
                paragraph (3).
            ``(2) Established formula.--
                    ``(A) In general.--Of the amounts described in 
                paragraph (1)(A), the Governor shall allocate--
                            ``(i) 60 percent on the basis of the 
                        relative number of unemployed individuals in 
                        each local area, compared to the total number 
                        of unemployed individuals in all local areas in 
                        the State;
                            ``(ii) 25 percent on the basis of the 
                        relative excess number of unemployed 
                        individuals in each local area, compared to the 
                        total excess number of unemployed individuals 
                        in all local areas in the State; and
                            ``(iii) 15 percent shall be allotted on the 
                        basis of the relative number of disadvantaged 
                        adults in each local area, compared to the 
                        total number of disadvantaged adults in all 
                        local areas in the State.
                    ``(B) Minimum and maximum percentages.--The 
                Governor shall ensure that no local area shall receive 
                an allocation for a fiscal year under this paragraph 
                that is less than 90 percent or greater than 130 
                percent of the allocation percentage of the local area 
                for the preceding fiscal year.
                    ``(C) Definitions.--
                            ``(i) Allocation percentage.--The term 
                        `allocation percentage', used with respect to 
                        fiscal year 2006 or a subsequent fiscal year, 
                        means a percentage of amount described in 
                        paragraph (1)(A) that is received through an 
                        allocation made under this paragraph for the 
                        fiscal year. The term, with respect to fiscal 
                        year 2005, means the percentage of the amounts 
                        allocated to local areas under this chapter (as 
                        in effect on the day before the date of 
                        enactment of the Job Training Improvement Act 
                        of 2005) that is received by the local area 
                        involved for fiscal year 2005.
                            ``(ii) Disadvantaged adult.--The term 
                        `disadvantaged adult' means an individual who 
                        is age 22 through 72 who received an income, or 
                        is a member of a family that received a total 
                        family income, that, in relation to family 
                        size, does not exceed the poverty line.
                            ``(iii) Excess number.--The term `excess 
                        number' means, used with respect to the excess 
                        number of unemployed individuals within a local 
                        area, the number that represents the number of 
                        unemployed individuals in excess of 4.5 percent 
                        of the civilian labor force in the local area.
            ``(3) Discretionary allocation.--The Governor shall 
        allocate to local areas the amounts described in paragraph 
        (1)(B) based on a formula developed in consultation with the 
        State board and local boards. Such formula shall be objective 
        and geographically equitable and may include such demographic 
        and economic factors as the Governor, after consultation with 
        the State board and local boards, determines are appropriate.
            ``(4) Local administrative cost limit.--
                    ``(A) In general.--Of the amounts allocated to a 
                local area under this subsection and section 128(b) for 
                a fiscal year, not more than 10 percent of the amount 
                may be used by the local boards for the administrative 
                costs of carrying out local workforce investment 
                activities under this chapter or chapter 4.
                    ``(B) Use of funds.--Funds made available for 
                administrative costs under subparagraph (A) may be used 
                for the administrative costs of any of the local 
                workforce investment activities described in this 
                chapter or chapter 4, regardless of whether the funds 
                were allocated under this subsection or section 
                128(b).''.
            (3) Reallocation among local areas.--Section 133(c) (29 
        U.S.C. 2863(c)) is amended--
                    (A) in paragraph (1), by striking ``paragraph 
                (2)(A) or (3) of'';
                    (B) by amending paragraph (2) to read as follows:
            ``(2) Amount.--The amount available for reallocation for a 
        program year is equal to the amount by which the unexpended 
        balance at the end of the program year prior to the program 
        year for which the determination is made exceeds 30 percent of 
        the total amount of funds available to the local area under 
        this section during such prior program year (including amounts 
        allotted to the local area in prior program years that remain 
        available). For purposes of this paragraph, the unexpended 
        balance is the amount that is the difference between--
                    ``(A) the total amount of funds available to the 
                local area under this section during the program year 
                prior to the program year for which the determination 
                is made (including amounts allocated to the local area 
                in all prior program years that remained available); 
                and
                    ``(B) the accrued expenditures during such prior 
                program year.'';
                    (C) by amending paragraph (3)--
                            (i) by striking ``subsection (b)(3)'' each 
                        place it appears and inserting ``subsection 
                        (b)'';
                            (ii) by striking ``the prior program year'' 
                        and inserting ``the program year in which the 
                        determination is made'';
                            (iii) by striking ``such prior program 
                        year'' and inserting ``such program year''; and
                            (iv) by striking the last sentence; and
                    (D) by amending paragraph (4) to read as follows:
            ``(4) Eligibility.--For purposes of this subsection, an 
        eligible local area means a local area which does not have an 
        amount available for reallocation under paragraph (2) for the 
        program year for which the determination under paragraph (2) is 
        made.''.
    (e) Use of Funds for Employment and Training Activities.--
            (1) Statewide employment and training activities.--
                    (A) In general.--Section 134(a)(1) (29 U.S.C. 
                2864(a)(1) is amended to read as follows:
            ``(1) In general.--
                    ``(A) Required use of funds.--Not less than 50 
                percent of the funds reserved by a Governor under 
                section 133(a) shall be used to support the provision 
                of core services in local areas, consistent with the 
                local plan, through one-stop delivery systems by 
                distributing funds to local areas in accordance with 
                subparagraph (B). Such funds may be used by States to 
                employ State personnel to provide such services in 
                designated local areas in consultation with local 
                boards.
                    ``(B) Method of distributing funds.--The method of 
                distributing funds under this paragraph shall be 
                developed in consultation with the State board and 
                local boards. Such method of distribution, which may 
                include the formula established under section 
                121(h)(3), shall be objective and geographically 
                equitable, and may include factors such as the number 
                of centers in the local area that have been certified, 
                the population served by such centers, and the 
                performance of such centers.
                    ``(C) Other use of funds.--Funds reserved by a 
                Governor for a State--
                            ``(i) under section 133(a) and not used 
                        under subparagraph (A), may be used for 
                        statewide activities described in paragraph 
                        (2); and
                            ``(ii) under section 133(a) and not used 
                        under subparagraph (A), and under section 
                        128(a) may be used to carry out any of the 
                        statewide employment and training activities 
                        described in paragraph (3).''.
                    (B) Statewide rapid response activities.--Section 
                134(a)(2) (29 U.S.C. 2864(a)(2)) is amended to read as 
                follows:
            ``(2) Statewide rapid response activities.--A State shall 
        carry out statewide rapid response activities using funds 
        reserved as described in section 133(a). Such activities shall 
        include--
                    ``(A) provision of rapid response activities, 
                carried out in local areas by the State or by an entity 
                designated by the State, working in conjunction with 
                the local boards and the chief elected officials in the 
                local areas; and
                    ``(B) provision of additional assistance to local 
                areas that experience disasters, mass layoffs or plant 
                closings, or other events that precipitate substantial 
                increases in the number of unemployed individuals, 
                carried out in local areas by the State, working in 
                conjunction with the local boards and the chief elected 
                officials in the local areas.''.
                    (C) Statewide employment and training activities.--
                Section 134(a)(3) (29 U.S.C. 2864(a)(3)) is amended to 
                read as follows:
            ``(3) Statewide activities.--Funds reserved by a Governor 
        for a State as described in sections 133(a) and 128(a) may be 
        used for statewide activities including--
                    ``(A) supporting the provision of core services 
                described in section 134(c)(2) in the one-stop delivery 
                system;
                    ``(B) conducting evaluations under section 136(e) 
                of activities authorized under this chapter and chapter 
                4 in coordination with evaluations carried out by the 
                Secretary under section 172, research, and 
                demonstration projects;
                    ``(C) providing incentive grants to local areas for 
                regional cooperation among local boards (including 
                local boards in a designated region as described in 
                section 116(c)), for local coordination of activities 
                carried out under this Act, and for exemplary 
                performance by local areas on the local performance 
                measures;
                    ``(D) providing technical assistance and capacity 
                building to local areas, one-stop operators, one-stop 
                partners, and eligible providers, including the 
                development and training of staff, the development of 
                exemplary program activities, and the provision of 
                technical assistance to local areas that fail to meet 
                local performance measures;
                    ``(E) operating a fiscal and management 
                accountability system under section 136(f);
                    ``(F) carrying out monitoring and oversight of 
                activities carried out under this chapter and chapter 
                4;
                    ``(G) implementing innovative programs, such as 
                incumbent worker training programs, programs and 
                strategies designed to meet the needs of businesses in 
                the State, including small businesses, and engage 
                employers in workforce activities, and programs serving 
                individuals with disabilities consistent with section 
                188;
                    ``(H) developing strategies for effectively serving 
                hard-to-serve populations and for integrating programs 
                and services among one-stop partners;
                    ``(I) implementing innovative programs for 
                displaced homemakers, which for purposes of this 
                subparagraph may include an individual who is receiving 
                public assistance and is within 2 years of exhausting 
                lifetime eligibility under Part A of title IV of the 
                Social Security Act (42 U.S.C. 601 et seq.);
                    ``(J) implementing programs to increase the number 
                of individuals training for and placed in 
                nontraditional employment; and
                    ``(K) carrying out activities to facilitate remote 
                access to services provided through a one-stop delivery 
                system, including facilitating access through the use 
                of technology.''.
                    (D) Limitation on state administrative 
                expenditures.--Section 134(a) is further amended by 
                adding the following new paragraph:
            ``(4) Limitation.--Not more than 5 percent of the funds 
        allotted under section 132(b) shall be used by the State for 
        administrative activities carried out under this subsection and 
        section 128(a).''.
            (2) Local employment and training activities.--Section 
        134(b) (29 U.S.C. 2864(b)) is amended--
                    (A) by striking ``under paragraph (2)(A)'' and all 
                that follows through ``section 133(b)(2)(B)'' and 
                inserting ``under section 133(b)'';
                    (B) in paragraphs (1) and (2), by striking ``or 
                dislocated workers, respectively'' both places it 
                appears; and
                    (C) by redesignating subsections (d) and (e) as 
                subsections (c) and (d), respectively.
            (3) Required local employment and training activities.--
                    (A) Allocated funds.--Section 134(c)(1) (29 U.S.C. 
                2864(c)(1)) (as redesignated by paragraph (2)) is 
                amended to read as follows:
            ``(1) In general.--Funds allocated to a local area for 
        adults under section 133(b) shall be used--
                    ``(A) to establish a one-stop delivery system as 
                described in section 121(e);
                    ``(B) to provide the core services described in 
                paragraph (2) through the one-stop delivery system in 
                accordance with such paragraph;
                    ``(C) to provide the intensive services described 
                in paragraph (3) to adults described in such paragraph; 
                and
                    ``(D) to provide training services described in 
                paragraph (4) to adults described in such paragraph.''.
                    (B) Core services.--Section 134(c)(2) (29 U.S.C. 
                2864(c)(2)) (as redesignated by paragraph (2)) is 
                amended--
                            (i) by striking ``who are adults or 
                        dislocated workers'';
                            (ii) in subparagraph (A), by striking 
                        ``under this subtitle'' and inserting ``under 
                        the one-stop partner programs described in 
                        section 121(b)'';
                            (iii) by amending subparagraph (D) to read 
                        as follows:
                    ``(D) labor exchange services, including--
                            ``(i) job search and placement assistance, 
                        and where appropriate career counseling;
                            ``(ii) appropriate recruitment services for 
                        employers; and
                            ``(iii) reemployment services provided to 
                        unemployment claimants.'';
                            (iv) in subparagraph (I), by inserting 
                        ``and the administration of the work test for 
                        the unemployment compensation system'' after 
                        ``compensation''; and
                            (v) by amending subparagraph (J) to read as 
                        follows:
                    ``(J) assistance in establishing eligibility for 
                programs of financial aid assistance for training and 
                education programs that are not funded under this Act 
                and are available in the local area; and''.
                    (C) Intensive services.--Section 134(c)(3) (29 
                U.S.C. 2864(c)(3) (as redesignated by paragraph (2) of 
                this subsection) is amended--
                            (i) by amending subparagraph (A) to read as 
                        follows:
                    ``(A) In general.--
                            ``(i) Eligibility.--Funds allocated to a 
                        local area under section 133(b) shall be used 
                        to provide intensive services for adults who--
                                    ``(I) Are unemployed and who have 
                                been determined by the one-stop 
                                operator to be.--
                                            ``(aa) unlikely or unable 
                                        to obtain suitable employment 
                                        through core services; and
                                            ``(bb) in need of intensive 
                                        services in order to obtain 
                                        suitable employment; or
                                    ``(II) are employed, but who are 
                                determined by a one-stop operator to be 
                                in need of intensive services to obtain 
                                or retain suitable employment.
                            ``(ii) Definition.--The Governor shall 
                        define the term `suitable employment' for 
                        purposes of this subparagraph.''.
                            (ii) in subparagraph (C)--
                                    (I) in clause (v), by striking 
                                ``for participants seeking training 
                                services under paragraph (4)''; and
                                    (II) by adding the following 
                                clauses after clause (vi):
                            ``(vii) Internships and work experience.
                            ``(viii) Literacy activities relating to 
                        basic work readiness, and financial literacy 
                        activities.
                            ``(ix) Out-of-area job search assistance 
                        and relocation assistance.''.
                    (D) Training services.--Section 134(c)(4) (as 
                redesignated by paragraph (2) of this subsection) is 
                amended--
                            (i) by amending subparagraph (A) to read as 
                        follows:
                    ``(A) In general.--
                            ``(i) Eligibility.--Funds allocated to a 
                        local area under section 133(b) shall be used 
                        to provide training services to adults who--
                                    ``(I) after an interview, 
                                evaluation, or assessment, and case 
                                management, have been determined by a 
                                one-stop operator or one-stop partner, 
                                as appropriate, to--
                                            ``(aa) be unlikely or 
                                        unable to obtain or retain 
                                        suitable employment through 
                                        intensive services under 
                                        paragraph (3)(A);
                                            ``(bb) be in need of 
                                        training services to obtain or 
                                        retain suitable employment; and
                                            ``(cc) have the skills and 
                                        qualifications to successfully 
                                        participate in the selected 
                                        program of training services;
                                    ``(II) select programs of training 
                                services that are directly linked to 
                                the employment opportunities in the 
                                local area involved or in another area 
                                in which the adults receiving such 
                                services are willing to commute or 
                                relocate;
                                    ``(III) who meet the requirements 
                                of subparagraph (B); and
                                    ``(IV) who are determined eligible 
                                in accordance with the priority system 
                                in effect under subparagraph (E).
                            ``(ii) The Governor shall define the term 
                        `suitable employment' for purposes of this 
                        subparagraph.'';
                            (ii) in subparagraph (B)(i), by striking 
                        ``Except'' and inserting ``Notwithstanding 
                        section 479B of the Higher Education Act of 
                        1965 (20 U.S.C. 1087uu) and except'';
                            (iii) by amending subparagraph (E) to read 
                        as follows:
                    ``(E) Priority.--
                            ``(i) In general.--A priority shall be 
                        given to unemployed individuals for the 
                        provision of intensive and training services 
                        under this subsection.
                            ``(ii) Additional priority.--If the funds 
                        in the local area, including the funds 
                        allocated under section 133(b), for serving 
                        recipients of public assistance and other low-
                        income individuals, including single parents, 
                        displaced homemakers, and pregnant single 
                        women, is limited, the priority for the 
                        provision of intensive and training services 
                        under this subsection shall include such 
                        recipients and individuals.
                            ``(iii) Determinations.--The Governor and 
                        the appropriate local board shall direct the 
                        one-stop operators in the local area with 
                        regard to making determinations with respect to 
                        the priority of service under this 
                        subparagraph.'';
                            (iv) in subparagraph (F), by adding the 
                        following clause after clause (iii):
                            ``(iv) Enhanced individual training 
                        accounts.--Each local board may, through one-
                        stop centers, assist individuals receiving 
                        individual training accounts through the 
                        establishment of such accounts that include, in 
                        addition to the funds provided under this 
                        paragraph, funds from other programs and 
                        sources that will assist the individual in 
                        obtaining training services.''; and
                            (v) in subparagraph (G)(iv), by 
                        redesignating subclause (IV) as subclause (V) 
                        and inserting after subclause (III) the 
                        following:
                                    ``(IV) Individuals with 
                                disabilities.''.
            (4) Permissible activities.--Section 134(d) (as 
        redesignated by paragraph (2)) is amended--
                    (A) by amending paragraph (1) to read as follows:
            ``(1) Discretionary one-stop delivery activities.--
                    ``(A) In general.--Funds allocated to a local area 
                under section 133(b) may be used to provide, through 
                the one-stop delivery system--
                            ``(i) customized screening and referral of 
                        qualified participants in training services to 
                        employers;
                            ``(ii) customized employment-related 
                        services to employers on a fee-for-service 
                        basis;
                            ``(iii) customer support to navigate among 
                        multiple services and activities for special 
                        participant populations that face multiple 
                        barriers to employment, including individuals 
                        with disabilities;
                            ``(iv) employment and training assistance 
                        provided in coordination with child support 
                        enforcement activities of the State agency 
                        carrying out subtitle D of title IV of the 
                        Social Security Act;
                            ``(v) activities to improve services to 
                        local employers, including small employers in 
                        the local area, and increase linkages between 
                        the local workforce investment system and 
                        employers; and
                            ``(vi) activities to facilitate remote 
                        access to services provided through a one-stop 
                        delivery system, including facilitating access 
                        through the use of technology.
                    ``(B) Work support activities for low-wage 
                workers.--
                            ``(i) In general.--Funds allocated to a 
                        local area under 133(b) may be used to provide, 
                        through the one-stop delivery system and in 
                        collaboration with the appropriate programs and 
                        resources of the one-stop partners, work 
                        support activities designed to assist low-wage 
                        workers in retaining and enhancing employment.
                            ``(ii) Activities.--The activities 
                        described in clause (i) may include assistance 
                        in accessing financial supports for which such 
                        workers may be eligible and the provision of 
                        activities available through the one-stop 
                        delivery system in a manner that enhances the 
                        opportunities of such workers to participate, 
                        such as the provision of employment and 
                        training activities during nontraditional hours 
                        and the provision of on-site child care while 
                        such activities are being provided.''; and
                    (B) by adding after paragraph (3) the following new 
                paragraph:
            ``(4) Incumbent worker training programs.--
                    ``(A) In general.--The local board may use up to 10 
                percent of the funds allocated to a local area under 
                section 133(b) to carry out incumbent worker training 
                programs in accordance with this paragraph.
                    ``(B) Training activities.--The training programs 
                for incumbent workers under this paragraph shall be 
                carried out by the local area in conjunction with the 
                employers of such workers for the purpose of assisting 
                such workers in obtaining the skills necessary to 
                retain employment and avert layoffs.
                    ``(C) Employer match required.--
                            ``(i) In general.--Employers participating 
                        in programs under this paragraph shall be 
                        required to pay a proportion of the costs of 
                        providing the training to the incumbent 
                        workers. The Governor shall establish, or may 
                        authorize the local board to establish, the 
                        required portion of such costs, which shall not 
                        be less than--
                                    ``(I) 10 percent of the costs, for 
                                employers with 50 or fewer employees;
                                    ``(II) 25 percent of the costs, for 
                                employers with more than 50 employees 
                                but fewer than 100 employees; and
                                    ``(III) 50 percent of the costs, 
                                for employers with 100 or more 
                                employees.
                            ``(ii) Calculation of match.--The wages 
                        paid by an employer to a worker while they are 
                        attending training may be included as part of 
                        the requirement payment of the employer.''.

SEC. 113. PERFORMANCE ACCOUNTABILITY SYSTEM.

    (a) State Performance Measures.--
            (1) In general.--Section 136(b)(1) (29 U.S.C. 2871(b)(1)) 
        is amended--
                    (A) in subparagraph (A)(i), by striking ``and the 
                customer satisfaction indicator of performance 
                described in paragraph (2)(B)''; and
                    (B) in subparagraph (A)(ii), by striking 
                ``paragraph (2)(C)'' and inserting ``paragraph 
                (2)(B)''.
            (2) Indicators of performance.--Section 136(b)(2) (29 
        U.S.C. 2871(b)(2)) is amended--
                    (A) in subparagraph (A)(i), by striking ``(except 
                for self-service and information activities) and (for 
                participants who are eligible youth age 19 through 21) 
                for youth activities authorized under section 129'';
                    (B) by amending subparagraph (A)(i)(IV) to read as 
                follows:
                                    ``(IV) the efficiency of the 
                                program in obtaining the outcomes 
                                described in subclauses (I) through 
                                (III).'';
                    (C) by amending subparagraph (A)(ii) to read as 
                follows:
                            ``(ii) Core indicators for eligible 
                        youth.--The core indicators of performance for 
                        youth activities authorized under section 129 
                        shall consist of--
                                    ``(I) entry into employment, 
                                education or advanced training, or 
                                military service;
                                    ``(II) attainment of secondary 
                                school diplomas or the General 
                                Educational Development credential 
                                (GED) (including recognized alternative 
                                standards for individuals with 
                                disabilities);
                                    ``(III) literacy or numeracy gains; 
                                and
                                    ``(IV) the efficiency of the 
                                program in obtaining the outcomes 
                                described in subclauses (I) through 
                                (III).'';
                    (D) by striking subparagraph (B); and
                    (E) by redesignating subparagraph (C) as 
                subparagraph (B), and by adding at the end of such 
                subparagraph (as so redesignated) the following new 
                sentence: ``Such indicators may include customer 
                satisfaction of employers and participants with 
                services received from the workforce investment 
                activities authorized under this subtitle.''.
            (3) Levels of performance.--Section 136(b)(3)(A) (29 U.S.C. 
        2871(b)(3)(A)) is amended--
                    (A) in clause (i), by striking ``and the customer 
                satisfaction indicator described in paragraph (2)(B)'';
                    (B) in clause (ii), by striking ``and the customer 
                satisfaction indicator of performance, for the first 
                3'' and inserting ``for the 2'';
                    (C) in clause (iii)--
                            (i) in the heading, by striking ``for first 
                        3 years''; and
                            (ii) by striking ``and the customer 
                        satisfaction indicator of performance, for the 
                        first 3'' and inserting ``for the 2'';
                    (D) in clause (iv)--
                            (i) by striking subclause (I);
                            (ii) by redesignating subclauses (II) and 
                        (III) as subclauses (I) and (II), respectively; 
                        and
                            (iii) in subclause (I) (as so 
                        redesignated)--
                                    (I) by striking ``taking into 
                                account'' and inserting ``which shall 
                                be adjusted based on'';
                                    (II) by inserting ``such as 
                                unemployment rates and job losses or 
                                gains in particular industries'' after 
                                ``economic conditions''; and
                                    (III) by inserting ``such as 
                                indicators of poor work history, lack 
                                of work experience, low levels of 
                                literacy or English proficiency, 
                                disability status, and welfare 
                                dependency'' after ``program'';
                    (E) by striking clause (v); and
                    (F) by redesignating clause (vi) as clause (v).
            (4) Additional indicators.--Section 136(b)(3)(B) is amended 
        by striking ``paragraph (2)(C)'' and inserting ``paragraph 
        (2)(B)''.
    (b) Local Performance Measures.--Section 136(c) (29 U.S.C 2871(c)) 
is amended--
            (1) in paragraph (1)(A)(i), by striking ``, and the 
        customer satisfaction indicator of performance described in 
        subsection (b)(2)(B),'';
            (2) in paragraph (1)(A)(ii), by striking ``subsection 
        (b)(2)(C)'' and inserting ``subsection (b)(2)(B)''; and
            (3) by amending paragraph (3) to read as follows:
            ``(3) Determinations.--In determining such local levels of 
        performance, the local board, the chief elected official, and 
        the Governor shall ensure such levels are adjusted based on the 
        specific economic characteristics (such as unemployment rates 
        and job losses or gains in particular industries), demographic 
        characteristics, or other characteristics of the population to 
        be served in the local area, such as poor work history, lack of 
        work experience, low levels of literacy or English proficiency, 
        disability status, and welfare dependency.''.
    (c) Report.--Section 136(d) (29 U.S.C. 2871(d)) is amended--
            (1) in paragraph (1), by striking ``and the customer 
        satisfaction indicator'' in both places that it appears;
            (2) in paragraph (2)(E), by striking ``(excluding 
        participants who received only self-service and informational 
        activities)''; and
            (3) by adding at the end the following:
            ``(4) Data validation.--In preparing the reports described 
        in this subsection, the States shall establish procedures, 
        consistent with guidelines issued by the Secretary, to ensure 
        the information contained in the report is valid and 
        reliable.''.
    (d) Sanctions for State.--Section 136(g) (29 U.S.C. 2871(g)) is 
amended--
            (1) in paragraph (1)(A), by striking ``or (B)''; and
            (2) in paragraph (2), by striking ``section 503'' and 
        inserting ``section 136(i)''.
    (e) Sanctions for Local Areas.--Section 136(h) (29 U.S.C. 2871(h)) 
is amended--
            (1) in paragraph (1), by striking ``or (B)''; and
            (2) by amending paragraph (2)(B) to read as follows:
                    ``(B) Appeal to governor.--A local area that is 
                subject to a reorganization plan under subparagraph (A) 
                may, not later than 30 days after receiving notice of 
                the reorganization plan, appeal to the Governor to 
                rescind or revise such plan. In such case, the Governor 
                shall make a final decision not later than 30 days 
                after the receipt of the appeal.''.
    (f) Incentive Grants.--Section 136(i) (29 U.S.C. 2871(i)) is 
amended to read as follows:
    ``(i) Incentive Grants for States and Local Areas.--
            ``(1) Incentive grants for states.--
                    ``(A) In general.--From funds appropriated under 
                section 174, the Secretary may award grants to States 
                for exemplary performance in carrying programs under 
                this chapters 4 and 5 of this title. Such awards may be 
                based on States meeting or exceeding the performance 
                measures established under this section, on the 
                performance of the State in serving special 
                populations, including the levels of service provided 
                and the performance outcomes, and such other factors 
                relating to the performance of the State under this 
                title as the Secretary determines is appropriate.
                    ``(B) Use of funds.--The funds awarded to a State 
                under this paragraph may be used to carry out any 
                activities authorized under chapters 4 and 5 of this 
                title, including demonstrations and innovative programs 
                for special populations.
            ``(3) Incentive grants for local areas.--
                    ``(A) In general.--From funds reserved under 
                sections 128(a) and 133(a), the Governor may award 
                incentive grants to local areas for exemplary 
                performance with respect to the measures established 
                under this section and with the performance of the 
                local area in serving special populations, including 
                the levels of service and the performance outcomes.
                    ``(B) Use of funds.--The funds awarded to a local 
                area may be used to carry out activities authorized for 
                local areas under chapters 4 and 5 of this title, and 
                such demonstration or other innovative programs to 
                serve special populations as may be approved by the 
                Governor.''.
    (g) Use of Core Indicators for Other Programs.--Section 136 (29 
U.S.C. 2871) is further amended by adding at the end the following 
subsection:
    ``(j) Use of Core Indicators for Other Programs.--In addition to 
the programs carried out under chapters 4 and 5, and consistent with 
the requirements of the applicable authorizing laws, the Secretary 
shall use the core indicators of performance described in subsection 
(b)(2)(A) to assess the effectiveness of the programs described under 
section 121(b)(1)(B) that are carried out by the Secretary.''.
    (h) Repeal of Definitions.--Sections 502 and 503 (and the items 
related to such sections in the table of contents) are repealed.

SEC. 114. AUTHORIZATION OF APPROPRIATIONS.

    (a) Youth Activities.--Section 137(a) (29 U.S.C. 2872(a)) is 
amended by striking ``such sums as may be necessary for each of fiscal 
years 1999 through 2003'' and inserting ``$1,250,000,000 for fiscal 
year 2006 and such sums as may be necessary for each of fiscal years 
2007 through 2011''.
    (b) Adult Employment and Training Activities.--Section 137(b) (29 
U.S.C. 2872(b)) is amended by striking ``section 132(a)(1), such sums 
as may be necessary for each of fiscal years 1999 through 2003'' and 
inserting ``132(a), $3,140,000,000 for fiscal year 2006 and such sums 
as may be necessary for each of fiscal years 2007 through 2011''.
    (c) Dislocated Worker Employment and Training Activities.--Section 
137 is further amended by striking subsection (c).

SEC. 115. JOB CORPS.

    (a) Community Participation.--Section 153 (29 U.S.C. 2893) is 
amended--
            (1) by amending subsection (a) to read as follows:
    ``(a) Business and Community Participation.--The director of each 
Job Corps center shall ensure the establishment and development of the 
business and community relationships and networks described in 
subsection (b) in order to enhance the effectiveness of such center.'';
            (2) in subsection (b)--
                    (A) in the heading, by striking 
                ``Responsibilities'' and inserting ``Networks''; and
                    (B) by striking ``The responsibilities of the 
                Liaison'' and inserting ``The activities carried out by 
                each Job Corps center under this section''; and
            (3) in subsection (c), by striking ``The Liaison for'' and 
        inserting ``The director of''.
    (b) Industry Councils.--Section 154(b) (29 U.S.C. 2894(b)) is 
amended--
            (1) in paragraph (1)(A), by striking ``local and distant''; 
        and
            (2) by adding after paragraph (2) the following:
            ``(3) Employers outside of local areas.--The industry 
        council may include, or otherwise provide for consultation 
        with, employers from outside the local area who are likely to 
        hire a significant number of enrollees from the Job Corps 
        center.''.
    (c) Indicators of Performance and Additional Information.--Section 
159(c) (29 U.S.C. 2893(c)) is amended--
            (1) by amending paragraph (1) to read as follows:
            ``(1) Core indicators.--The Secretary shall annually 
        establish expected levels of performance for Job Corps centers 
        and the Job Corps program relating to each of the core 
        indicators for youth identified in section 136(b)(2)(A)(ii).''; 
        and
            (2) in paragraph (2), by striking ``measures'' each place 
        it appears and inserting ``indicators''.
    (d) Authorization of Appropriations.--Section 161 (29 U.S.C. 2901) 
is amended by striking ``1999 through 2003'' and inserting ``2006 
through 2011''.

SEC. 116. NATIVE AMERICAN PROGRAMS.

    (a) Advisory Council.--Section 166(h)(4)(C) (29 U.S.C. 
2911(h)(4)(C)) is amended to read as follows:
                    ``(C) Duties.--The Council shall advise the 
                Secretary on the operation and administration of the 
                programs assisted under this section.''.
    (b) Assistance to American Samoans in Hawaii.--Section 166 (29 
U.S.C. 2911) is further amended by striking subsection (j).

SEC. 117. MIGRANT AND SEASONAL FARMWORKER PROGRAMS.

    Section 167(d) is amended by inserting ``(including permanent 
housing)'' after ``housing''.

SEC. 118. VETERANS' WORKFORCE INVESTMENT PROGRAMS.

    Section 168(a)(3)(C) (29 U.S.C. 2913 (a)(3)(C)) is amended by 
striking ``section 134(c)'' and inserting ``section 121(e)''.

SEC. 119. YOUTH CHALLENGE GRANTS.

    (a) In General.--Section 169 (29 U.S.C. 2914) is amended to read as 
follows:

``SEC. 169. YOUTH CHALLENGE GRANTS.

    ``(a) In General.--Of the amounts reserved by the Secretary under 
section 127(a)(1)(A) for a fiscal year--
            ``(1) the Secretary shall use not less than 80 percent to 
        award competitive grants under subsection (b); and
            ``(2) the Secretary may use not more than 20 percent to 
        award discretionary grants under subsection (c).
    ``(b) Competitive Grants to States and Local Areas.--
            ``(1) Establishment.--From the funds described in 
        subsection (a)(1), the Secretary shall award competitive grants 
        to eligible entities to carry out activities authorized under 
        this section to assist eligible youth in acquiring the skills, 
        credentials and employment experience necessary to succeed in 
        the labor market.
            ``(2) Eligible entities.--Grants under this subsection may 
        be awarded to States, local boards, recipients of grants under 
        section 166 (relating to Native American programs), and public 
        or private entities (including consortia of such entities) 
        applying in conjunction with local boards.
            ``(3) Grant period.--The Secretary may make a grant under 
        this section for a period of 1 year and may renew the grants 
        for each of the 4 succeeding years.
            ``(4) Authority to require match.--The Secretary may 
        require that grantees under this subsection provide a non-
        Federal share of the cost of activities carried out under a 
        grant awarded under this subsection.
            ``(5) Participant eligibility.--Youth ages 14 through 19 as 
        of the time the eligibility determination is made may be 
        eligible to participate in activities provided under this 
        subsection.
            ``(6) Use of funds.--Funds under this subsection may be 
        used for activities that are designed to assist youth in 
        acquiring the skills, credentials and employment experience 
        that are necessary to succeed in the labor market, including 
        the activities identified in section 129. The activities may 
        include activities such as--
                    ``(A) training and internships for out-of-school 
                youth in sectors of economy experiencing or projected 
                to experience high growth;
                    ``(B) after-school dropout prevention activities 
                for in-school youth;
                    ``(C) activities designed to assist special youth 
                populations, such as court-involved youth and youth 
                with disabilities; and
                    ``(D) activities combining remediation of academic 
                skills, work readiness training, and work experience, 
                and including linkages to postsecondary education, 
                apprenticeships, and career-ladder employment.
            ``(7) Applications.--To be eligible to receive a grant 
        under this subsection, an eligible entity shall submit an 
        application to the Secretary at such time, in such manner, and 
        containing such information as the Secretary may require, 
        including--
                    ``(A) a description of the activities the eligible 
                entity will provide to eligible youth under this 
                subsection;
                    ``(B) a description of the programs of demonstrated 
                effectiveness on which the provision of the activities 
                under subparagraph (A) are based, and a description of 
                how such activities will expand the base of knowledge 
                relating to the provision of activities for youth;
                    ``(C) a description of the private and public, and 
                local and State resources that will be leveraged to 
                provide the activities described under subparagraph (A) 
                in addition the funds provided under this subsection; 
                and
                    ``(D) the levels of performance the eligible entity 
                expects to achieve with respect to the indicators of 
                performance for youth specified in section 
                136(b)(2)(A)(ii).
            ``(8) Factors for award.--In awarding grants under this 
        subsection the Secretary may consider the quality of the 
        proposed project, the goals to be achieved, the likelihood of 
        successful implementation, the extent to which the project is 
        based on proven strategies or the extent to which the project 
        will expand the knowledge base on activities for youth, and the 
        additional State, local or private resources that will be 
        provided.
            ``(9) Evaluation.--The Secretary may reserve up to 5 
        percent of the funds described in subsection(a)(1) to provide 
        technical assistance to, and conduct evaluations of the 
        projects funded under this subsection (using appropriate 
        techniques as described in section 172(c)).
    ``(c) Discretionary Grants for Youth Activities.--
            ``(1) In general.--From the funds described in 
        subsection(a)(2), the Secretary may award grants to eligible 
        entities to provide activities that will assist youth in 
        preparing for, and entering and retaining, employment.
            ``(2) Eligible entities.--Grants under this subsection may 
        be awarded to public or private entities that the Secretary 
        determines would effectively carry out activities relating to 
        youth under this subsection.
            ``(3) Participant eligibility.--Youth ages 14 through 19 at 
        the time the eligibility determination is made may be eligible 
        to participate in activities under this subsection.
            ``(4) Use of funds.--Funds provided under this subsection 
        may be used for activities that will assist youth in preparing 
        for, and entering and retaining, employment, including the 
        activities described in section 129 for out-of-school youth, 
        activities designed to assist in-school youth to stay in school 
        and gain work experience, and such other activities that the 
        Secretary determines are appropriate.
            ``(5) Applications.--To be eligible to receive a grant 
        under this subsection, an eligible entity shall submit an 
        application to the Secretary at such time, in such manner, and 
        containing such information as the Secretary may require.
            ``(6) Additional requirements.--The Secretary may require 
        the provision of a non-Federal share for projects funded under 
        this subsection and may require participation of grantees in 
        evaluations of such projects, including evaluations using the 
        techniques as described in section 172(c).''.
    (b) Clerical Amendment.--The table of contents in section1(b) is 
amended by amending the item related to section 169 to read as follows:

``Sec. 169. Youth challenge grants.''.

SEC. 120. TECHNICAL ASSISTANCE.

    Section 170 (29 U.S.C. 2915) is amended--
            (1) by striking subsection (b);
            (2) by striking
    ``(a) General Technical Assistance.--''.
            (3) by redesignating paragraphs (1), (2), and (3) as 
        subsections (a), (b), and (c) respectively, and moving such 
        subsections 2 ems to the left;
            (4) in subsection (a) (as redesignated by paragraph (3))--
                    (A) by inserting ``the training of staff providing 
                rapid response services, the training of other staff of 
                recipients of funds under this title, peer review 
                activities under this title, assistance regarding 
                accounting and program operation practices (when such 
                assistance would not be duplicative to assistance 
                provided by the State),'' after ``localities,''; and
                    (B) by striking ``from carrying out activities'' 
                and all that follows up to the period and inserting 
                ``to implement the amendments made by the Job Training 
                Improvement Act of 2005''; and
            (5) by inserting, after subsection (c) (as redesignated by 
        paragraph (3)), the following:
    ``(d) Best Practices Coordination.--The Secretary shall establish a 
system whereby States may share information regarding best practices 
with regards to the operation of workforce investment activities under 
this Act.''.

SEC. 121. DEMONSTRATION, PILOT, MULTISERVICE, RESEARCH AND MULTI-STATE 
              PROJECTS.

    (a) Demonstration and Pilot Projects.--Section 171(b) (29 U.S.C. 
2916(b)) is amended--
            (1) in paragraph (1)--
                    (A) by striking ``Under a'' and inserting 
                ``Consistent with the priorities specified in the'';
                    (B) by amending subparagraphs (A) through (D) to 
                read as follows:
                    ``(A) projects that assist national employers in 
                connecting with the workforce investment system 
                established under this title in order to facilitate the 
                recruitment and employment of needed workers and to 
                provide information to such system on skills and 
                occupations in demand;
                    ``(B) projects that promote the development of 
                systems that will improve the effectiveness and 
                efficiency of programs carried out under this title;
                    ``(C) projects that focus on opportunities for 
                employment in industries and sectors of industries that 
                are experiencing or are likely to experience high rates 
                of growth;
                    ``(D) projects carried out by States and local 
                areas to test innovative approaches to delivering 
                employment-related services;'';
                    (C) by striking subparagraph (E);
                    (D) by redesignating subparagraphs (F) and (G) as 
                subparagraphs (E) and (F), respectively;
                    (E) by inserting after subparagraph (F) (as so 
                redesignated) the following:
                    ``(G) projects that provide retention grants to 
                qualified job training programs upon placement or 
                retention of a low-income individual trained by that 
                program in employment with a single employer for a 
                period of 1 year, provided that such employment is 
                providing to the low-income individual an income not 
                less than twice the poverty line for that 
                individual.''; and
                    (F) by striking subparagraph (H); and
            (2) in paragraph (2)--
                    (A) by striking subparagraph (B); and
                    (B) by redesignating subparagraph (C) as 
                subparagraph (B).
    (b) Multiservice Projects.--Section 171(c)(2)(B) (29 U.S.C. 
2916(c)(2)(B)) is amended to read as follows:
                    ``(B) Net impact studies and reports.--The 
                Secretary shall conduct studies to determine the net 
                impacts of programs, services, and activities carried 
                out under this title. The Secretary shall prepare and 
                disseminate to Congress and the public reports 
                containing the results of such studies.''.

SEC. 122. COMMUNITY-BASED JOB TRAINING.

    Section 171(d) of the Workforce Investment Act of 1998 is amended 
to read as follows:
    ``(d) Community-Based Job Training.--In addition to the 
demonstration projects under subsection (b), the Secretary may 
establish and implement a national demonstration project designed to 
develop local solutions to the workforce challenge facing high-growth, 
high-skill industries with labor shortages, and increase opportunities 
for workers to gain access to employment in high-growth, high-demand 
occupations.''.

SEC. 123. PERSONAL REEMPLOYMENT ACCOUNTS.

    Section 171 of the Workforce Investment Act of 1998 is further 
amended by adding at the end the following:
    ``(e) Personal Reemployment Accounts.--
            ``(1) Definition.--In this subsection, the term `State' 
        means each of the several States of the United States, the 
        District of Columbia, the Commonwealth of Puerto Rico, and the 
        United States Virgin Islands.
            ``(2) Demonstration project.--In addition to the 
        demonstration projects under subsection (b), the Secretary may 
        establish and implement a national demonstration project 
        designed to analyze and provide data on workforce training 
        programs that accelerate the reemployment of unemployed 
        individuals, promote the retention in employment of such 
        individuals, and provide such individuals with enhanced 
        flexibility, choice, and control in obtaining intensive 
        reemployment, training, and supportive services.
            ``(3) Grants.--
                    ``(A) In general.--In carrying out the 
                demonstration project, the Secretary shall make grants, 
                on a competitive basis, to eligible entities to provide 
                personal reemployment accounts to eligible individuals. 
                In awarding grants under this subsection the Secretary 
                shall take into consideration awarding grants to 
                eligible entities from diverse geographic areas, 
                including rural areas.
                    ``(B) Duration.--The Secretary shall make the 
                grants for periods of not less than 2 years and may 
                renew the grant for each of the succeeding 3 years.
            ``(4) Eligible entity.--In this subsection, the term 
        `eligible entity' means--
                    ``(A) a State; or
                    ``(B) a local board or consortium of local boards.
            ``(5) Use of funds.--
                    ``(A) In general.--An eligible entity that receives 
                a grant under this subsection shall use the grant funds 
                to provide, through a local area or areas, eligible 
                individuals with personal reemployment accounts. An 
                eligible individual may receive only 1 personal 
                reemployment account.
                    ``(B) Geographic area and amount.--
                            ``(i) In general.--The eligible entity 
                        shall establish the amount of a personal 
                        reemployment account for each eligible 
                        individual participating, which shall be 
                        uniform throughout the area represented by the 
                        eligible entity, and shall not exceed $3,000.
                            ``(ii) Option for states.--If the eligible 
                        entity is a State, the eligible entity may 
                        choose to use the grant statewide, if 
                        practicable, or only in specified local areas 
                        within a State.
                    ``(C) Eligible individuals.--
                            ``(i) In general.--Each eligible entity 
                        shall establish eligibility criteria for 
                        individuals for personal reemployment accounts 
                        in accordance with this subparagraph.
                            ``(ii) Eligibility criteria requirements.--
                                    ``(I) In general.--Subject to 
                                subclause (II), an individual shall be 
                                eligible to receive a personal 
                                reemployment account under a grant 
                                awarded under this subsection if, 
                                beginning after the date of enactment 
                                of this subsection, the individual--
                                            ``(aa) is identified by the 
                                        State pursuant to section 
                                        303(j)(1) of the Social 
                                        Security Act (42 U.S.C. 
                                        503(j)(1)) as likely to exhaust 
                                        regular unemployment 
                                        compensation and in need of job 
                                        search assistance to make a 
                                        successful transition to new 
                                        employment, or the individual's 
                                        unemployment can be attributed 
                                        in substantial part to unfair 
                                        competition from Federal Prison 
                                        Industries, Incorporated;
                                            ``(bb) is receiving regular 
                                        unemployment compensation under 
                                        any Federal or State 
                                        unemployment compensation 
                                        program administered by the 
                                        State; and
                                            ``(cc) is eligible for not 
                                        less than 20 weeks of regular 
                                        unemployment compensation 
                                        described in item (bb).
                                    ``(II) Additional eligibility and 
                                priority criteria.--An eligible entity 
                                may establish criteria that are in 
                                addition to the criteria described in 
                                subclause (I) for the eligibility of 
                                individuals to receive a personal 
                                reemployment account under this 
                                subsection. An eligible entity may also 
                                establish criteria for priority in the 
                                provision of a personal reemployment 
                                account to such eligible individuals 
                                under a grant awarded under this 
                                subsection.
                            ``(iii) Transition rule.--
                                    ``(I) Previously identified as 
                                likely to exhaust unemployment 
                                compensation.--
                                            ``(aa) In general.--At the 
                                        option of the eligible entity, 
                                        and subject to item (bb), an 
                                        individual may be eligible to 
                                        receive a personal reemployment 
                                        account under this subsection 
                                        if the individual--

                                                    ``(AA) during the 
                                                13-week period ending 
                                                the week prior to the 
                                                date of the enactment 
                                                of the subsection, was 
                                                identified by the State 
                                                pursuant to section 
                                                303(j)(1) of the Social 
                                                Security Act (42 U.S.C. 
                                                503(j)(1)) as likely to 
                                                exhaust regular 
                                                unemployment 
                                                compensation and in 
                                                need of job search 
                                                assistance to make a 
                                                successful transition 
                                                to new employment; and

                                                    ``(BB) otherwise 
                                                meets the requirements 
                                                of clause (ii)(I)(bb) 
                                                and (cc).

                                            ``(bb) Additional 
                                        eligibility and priority 
                                        criteria.--An eligible entity 
                                        may establish criteria that is 
                                        in addition to the criteria 
                                        described in item (aa) for the 
                                        eligibility of individuals to 
                                        receive a personal reemployment 
                                        account under this subsection. 
                                        An eligible entity may also 
                                        establish criteria for priority 
                                        in the provision of such 
                                        accounts to such eligible 
                                        individuals under this 
                                        subsection.
                                    ``(II) Previously exhausted 
                                unemployment compensation.--At the 
                                option of the eligible entity, an 
                                individual may be eligible to receive a 
                                personal reemployment account under a 
                                grant awarded under this subsection if 
                                the individual--
                                            ``(aa) during the 26-week 
                                        period ending the week prior to 
                                        the date of the enactment of 
                                        this subsection, exhausted all 
                                        rights to any unemployment 
                                        compensation; and
                                            ``(bb)(AA) is enrolled in 
                                        training and needs additional 
                                        support to complete such 
                                        training, with a priority of 
                                        service to be provided to such 
                                        individuals who are training 
                                        for shortage occupations or 
                                        high-growth industries; or
                                            ``(BB) is separated from 
                                        employment in an industry or 
                                        occupation that has experienced 
                                        declining employment, or no 
                                        longer provides any employment, 
                                        in the local labor market 
                                        during the 2-year period ending 
                                        on the date of the 
                                        determination of eligibility of 
                                        the individual under this 
                                        subparagraph.
                            ``(iv) No individual entitlement.--Nothing 
                        in this subsection shall be construed to 
                        entitle any individual to receive a personal 
                        reemployment account.
                    ``(D) Limitations.--
                            ``(i) Information and attestation.--Prior 
                        to the establishment of a personal reemployment 
                        account for an eligible individual, the 
                        eligible entity receiving a grant, through the 
                        one-stop delivery system in the participating 
                        local area or areas, shall ensure that the 
                        individual--
                                    ``(I) is informed of the 
                                requirements applicable to the personal 
                                reemployment account, including the 
                                allowable uses of funds from the 
                                account, the limitations on access to 
                                services described in paragraph 
                                (7)(A)(iii) and a description of such 
                                services, and the conditions for 
                                receiving a reemployment bonus;
                                    ``(II) has the option to develop a 
                                personal reemployment plan which will 
                                identify the employment goals and 
                                appropriate combination of services 
                                selected by the individual to achieve 
                                the employment goals; and
                                    ``(III) signs an attestation that 
                                the individual has been given the 
                                option to develop a personal 
                                reemployment plan in accordance with 
                                subclause (II), will comply with the 
                                requirements under this subsection 
                                relating to the personal reemployment 
                                accounts, and will reimburse the 
                                account or, if the account has been 
                                terminated, the grant awarded under 
                                this subsection, for any amounts 
                                expended from the account that are not 
                                allowable.
                            ``(ii) Periodic interviews.--If a recipient 
                        exhausts his or her rights to any unemployment 
                        compensation, and the recipient has a remaining 
                        balance in his or her personal reemployment 
                        account, the one-stop delivery system shall 
                        conduct periodic interviews with the recipient 
                        to assist the recipient in meeting his or her 
                        individual employment goals.
                            ``(iii) Use of personal reemployment 
                        accounts.--The eligible entity receiving a 
                        grant shall ensure that eligible individuals 
                        receiving a personal reemployment account use 
                        the account in accordance with paragraph (7).
            ``(6) Application for grants.--To be eligible to receive a 
        grant under this subsection, an eligible entity shall submit an 
        application to the Secretary at such time, in such manner, and 
        containing such information as the Secretary may require, 
        including--
                    ``(A) if the eligible entity is a State--
                            ``(i) assurance that the application was 
                        developed in conjunction with the local board 
                        or boards and chief elected officials where the 
                        personal reemployment accounts shall be made 
                        available; and
                            ``(ii) a description of the methods and 
                        procedures for providing funds to local areas 
                        where the personal reemployment accounts shall 
                        be made available; and
                    ``(B) a description of the criteria and methods to 
                be used for determining eligibility for the personal 
                reemployment account, including whether the eligible 
                entity intends to include the optional categories 
                described in paragraph (5)(C)(iii), and the additional 
                criteria and priority for service that the eligible 
                entity intends to apply, if any, pursuant to paragraph 
                (5)(C)(ii)(II);
                    ``(C) a description of the methods or procedures to 
                be used to provide eligible individuals information 
                relating to services and providers;
                    ``(D) a description of safeguards to ensure that 
                funds from the personal reemployment accounts are used 
                for purposes authorized under this subsection and to 
                ensure the quality and integrity of services and 
                providers, consistent with the purpose of providing 
                eligible individuals with enhanced flexibility, choice, 
                and control in obtaining intensive reemployment, 
                training, and supportive services;
                    ``(E) a description of how the eligible entity will 
                coordinate the activities carried out under this 
                subsection with the employment and training activities 
                carried out under section 134 and other activities 
                carried out by local boards through the one-stop 
                delivery system in the State or local area; and
                    ``(F) an assurance that the eligible entity will 
                comply with any evaluation and reporting requirements 
                the Secretary may require.
            ``(7) Use of personal reemployment accounts.--
                    ``(A) Allowable activities.--
                            ``(i) In general.--Subject to the 
                        requirements contained in clauses (ii) and 
                        (iii), a recipient of a personal reemployment 
                        account may use amounts in a personal 
                        reemployment account to purchase 1 or more of 
                        the following:
                                    ``(I) Intensive services, including 
                                those type of services specified in 
                                section 134(d)(3)(C).
                                    ``(II) Training services, including 
                                those types of services specified in 
                                section 134(d)(4)(D).
                                    ``(III) Supportive services, except 
                                for needs related payments.
                            ``(ii) Delivery of services.--The following 
                        requirements relating to delivery of services 
                        shall apply to the grants under this 
                        subsection:
                                    ``(I) Recipients may use funds from 
                                the personal reemployment account to 
                                purchase the services described in 
                                clause (i) through the one-stop 
                                delivery system on a fee-for-service 
                                basis, or through other providers, 
                                consistent with the safeguards 
                                described in paragraph (6)(D).
                                    ``(II) The eligible entity, through 
                                the one-stop delivery system in the 
                                participating local area, may pay costs 
                                for such services directly on behalf of 
                                the recipient, through a voucher 
                                system, or by reimbursement to the 
                                recipient upon receipt of appropriate 
                                cost documentation.
                                    ``(III) Each eligible entity, 
                                through the one-stop delivery system in 
                                the participating local area, shall 
                                make available to recipients 
                                information on training providers 
                                specified in section 134(d)(4)(F)(ii), 
                                information available to the one-stop 
                                delivery system on providers of the 
                                intensive and supportive services 
                                described in clause (i), and 
                                information relating to occupations in 
                                demand in the local area.
                            ``(iii) Limitations.--The following 
                        limitations shall apply with respect to 
                        personal reemployment accounts under this 
                        subsection:
                                    ``(I) Amounts in a personal 
                                reemployment account may be used for up 
                                to 1 year from the date of the 
                                establishment of the account.
                                    ``(II) Each recipient shall submit 
                                cost documentation as required by the 
                                one-stop delivery system.
                                    ``(III) For the 1-year period 
                                following the establishment of the 
                                account, recipients may not receive 
                                intensive, supportive, or training 
                                services funded under this title except 
                                on a fee-for-services basis as 
                                specified in clause (ii)(I).
                                    ``(IV) Amounts in a personal 
                                reemployment account shall be 
                                nontransferable.
                    ``(B) Reemployment bonus.--
                            ``(i) In general.--Subject to clause (ii)--
                                    ``(I) if a recipient determined 
                                eligible under paragraph (5)(C)(ii) 
                                obtains full-time employment before the 
                                13th week of unemployment for which 
                                unemployment compensation is paid, the 
                                balance of his or her personal 
                                reemployment account shall be provided 
                                directly to the recipient in cash; and
                                    ``(II) if a recipient determined 
                                eligible under paragraph (5)(C)(iii) 
                                obtains full-time employment before the 
                                end of the 13th week after the date on 
                                which the account is established, the 
                                balance of his or her personal 
                                reemployment account shall be provided 
                                directly to the recipient in cash.
                            ``(ii) Limitations.--The following 
                        limitations shall apply with respect to a 
                        recipient described in clause (i):
                                    ``(I) 60 percent of the remaining 
                                personal reemployment account balance 
                                shall be paid to the recipient at the 
                                time of employment.
                                    ``(II) 40 percent of the remaining 
                                personal reemployment account shall be 
                                paid to the recipient after 26 weeks of 
                                employment retention.
                            ``(iii) Exception regarding subsequent 
                        employment.--If a recipient described in clause 
                        (i) subsequently becomes unemployed due to a 
                        lack of work after receiving the portion of the 
                        reemployment bonus specified under clause 
                        (ii)(I), the individual may use the amount 
                        remaining in the personal reemployment account 
                        for the purposes described in subparagraph (A) 
                        but may not be eligible for additional cash 
                        payments under this subparagraph.
            ``(8) Program information and evaluation.--
                    ``(A) Information.--The Secretary may require from 
                eligible entities the collection and reporting on such 
                financial, performance, and other program-related 
                information as the Secretary determines is appropriate 
                to carry out this subsection, including the evaluation 
                described in subparagraph (B).
                    ``(B) Evaluation.--
                            ``(i) In general.--The Secretary, pursuant 
                        to the authority provided under section 172, 
                        shall, directly or through grants, contracts, 
                        or cooperative agreement with appropriate 
                        entities, conduct an evaluation of the 
                        activities carried out under any grants awarded 
                        under this subsection.
                            ``(ii) Report.--The report to Congress 
                        under section 172(e) relating to the results of 
                        the evaluations required under section 172 
                        shall include the recommendation of the 
                        Secretary with respect to the use of personal 
                        reemployment account as a mechanism to assist 
                        individuals in obtaining and retaining 
                        employment.''.

SEC. 124. NATIONAL DISLOCATED WORKER GRANTS.

    (a) In General.--Section 173 (29 U.S.C. 2916) is amended--
            (1) by amending the designation and heading to read as 
        follows:

``SEC. 173. NATIONAL DISLOCATED WORKER GRANTS.'';

        and
            (2) in subsection (a)--
                    (A) by striking ``national emergency grants'' in 
                the matter preceding paragraph (1) and inserting 
                ``national dislocated worker grants''; and
                    (B) in paragraph (1), by striking ``subsection 
                (c)'' and inserting ``subsection (b)''.
    (b) Administration.--Section 173 (29 U.S.C. 2918) is further 
amended--
            (1) by striking subsection (b) and redesignating 
        subsections (c) and (d) as subsections (b) and (c), 
        respectively; and
            (2) by striking subsection (e) and redesignating 
        subsections (f) and (g) as subsection (d) and (e), 
        respectively.
    (c) Eligible Entities.--Section 173(b)(1)(B) (29 U.S.C. 
2918(b)(1)(B)) (as redesignated by subsection (b) of this section) is 
amended by striking ``, and other entities'' and all that follows and 
inserting a period.
    (d) Participant Eligibility for Military Spouses.--Section 
173(b)(2)(A) (29 U.S.C. 2918(b)(2)(A)) (as redesignated by subsection 
(b)) is amended--
            (1) in clause (iii), by striking ``; or'' and inserting a 
        semicolon;
            (2) in clause (iv)(IV) by striking the period and inserting 
        ``; or''; and
            (3) by inserting at the end the following:
                            ``(v) is the spouse of a member of the 
                        Armed Forces who is on active duty or full-time 
                        National Guard duty, or who was recently 
                        separated from such duties, and such spouse is 
                        in need of employment and training assistance 
                        to obtain or retain employment.''.
    (e) Conforming Amendment.--The table of contents in section 1(b) is 
amended by amending the item related to section 173 to read as follows:

``Sec. 173. National dislocated worker grants.''.

SEC. 125. AUTHORIZATION OF APPROPRIATIONS FOR NATIONAL ACTIVITIES.

    (a) In General.--Section 174(a)(1) (29 U.S.C. 2919(a)(1)) is 
amended by striking ``1999 through 2003'' and inserting ``2006 through 
2011''.
    (b) Reservations.--Section 174(b) is amended to read as follows:
    ``(b) Technical Assistance; Demonstration and Pilot Projects; 
Evaluations; Incentive Grants.--There are authorized to be appropriated 
to carry out sections 170 through 172 and section 136 such sums as may 
be necessary for each of fiscal years 2006 through 2011.''.

SEC. 126. REQUIREMENTS AND RESTRICTIONS.

    (a) In General.--Section 181(c)(2)(A) (29 U.S.C. 2931(c)(2)(A)) is 
amended in the matter preceding clause (i) by striking ``shall'' and 
inserting ``may''.
    (b) Limitations.--Section 181(e) is amended by striking ``training 
for'' and inserting ``the entry into employment, retention in 
employment, or increases in earnings of''.

SEC. 127. NONDISCRIMINATION.

    Section 188(a)(2) (29 U.S.C. 2931(a)(2)) is amended to read as 
follows:
            ``(2) Prohibition of discrimination regarding 
        participation, benefits, and employment.--
                    ``(A) In general.--Except as provided in 
                subparagraph (B), no individual shall be excluded from 
                participation in, denied the benefits of, subjected to 
                discrimination under, or denied employment in the 
                administration of or in connection with any such 
                program or activity because of race, color, religion, 
                sex, (except as otherwise permitted under title IX of 
                the Education Amendments of 1972), national origin, 
                age, disability, or political affiliation.
                    ``(B) Exemption for religious organizations.--
                Subparagraph (A) shall not apply to a recipient of 
                financial assistance under this title that is a 
                religious corporation, association, educational 
                institution, or society, with respect to the employment 
                of individuals of a particular religion to perform work 
                connected with the carrying on by such corporation, 
                association, educational institution, or society of its 
                activities Such recipients shall comply with the other 
                requirements contained in subparagraph (A).''.

SEC. 128. ADMINISTRATIVE PROVISIONS.

    (a) Program Year.--Section 189(g)(1) (29 U.S.C. 2939(g)(1)) is 
amended to read as follows:
            ``(1) In general.--Appropriations for any fiscal year for 
        programs and activities carried out under this title shall be 
        available for obligation only on the basis of a program year. 
        The program year shall begin on July 1 in the fiscal year for 
        which the appropriation is made.''.
    (b) Availability.--Section 189(g)(2) (29 U.S.C. 2939(g)(2)) is 
amended by striking ``each State'' and inserting ``each recipient''.
    (c) General Waivers.--Section 189(i)(4) (29 U.S.C. 2939(i)(4)) is 
amended--
            (1) in subparagraph (A), in the matter preceding clause 
        (i), by inserting ``, or in accordance with subparagraph (D),'' 
        after ``subparagraph (B)''; and
            (2) by adding the following subparagraph:
                    ``(D) Expedited process for extending approved 
                waivers to additional states.--In lieu of the 
                requirements of subparagraphs (B) and (C), the 
                Secretary may establish an expedited procedure for the 
                purpose of extending to additional States the waiver of 
                statutory or regulatory requirements that have been 
                approved for a State pursuant to a request under 
                subparagraph (B). Such procedure shall ensure that the 
                extension of such waivers to additional States are 
                accompanied by appropriate conditions relating the 
                implementation of such waivers.''.

SEC. 129. GENERAL PROGRAM REQUIREMENTS.

    Section 195 (29 U.S.C. 2945) is amended by adding at the end the 
following new paragraph:
            ``(14) Funds provided under this title shall not be used to 
        establish or operate stand-alone fee-for-service enterprises 
        that compete with private sector employment agencies within the 
        meaning of section 701(c) of the Civil Rights Act of 1964 (42 
        U.S.C. 2000e(c)). For purposes of this paragraph, such an 
        enterprise does not include one-stop centers.''.

                       TITLE II--ADULT EDUCATION

        PART A--ADULT BASIC SKILLS AND FAMILY LITERACY EDUCATION

SEC. 201. TABLE OF CONTENTS.

    The table of contents in section 1(b) is amended by amending the 
items relating to title II to read as follows:

      ``Title II--Adult basic skills and family Literacy education

        ``Sec. 201. Short title.
        ``Sec. 202. Purpose.
        ``Sec. 203. Definitions.
        ``Sec. 204. Home schools.
        ``Sec. 205. Authorization of appropriations.
                    ``Chapter 1--Federal provisions

        ``Sec. 211. Reservation of funds; grants to eligible agencies; 
                            allotments.
        ``Sec. 212. Performance accountability system.
        ``Sec. 213. Incentive grants for States.
                     ``Chapter 2--State provisions

        ``Sec. 221. State administration.
        ``Sec. 222. State distribution of funds; matching requirement.
        ``Sec. 223. State leadership activities.
        ``Sec. 224. State plan.
        ``Sec. 225. Programs for corrections education and other 
                            institutionalized individuals.
                     ``Chapter 3--Local provisions

        ``Sec. 231. Grants and contracts for eligible providers.
        ``Sec. 232. Local application.
        ``Sec. 233. Local administrative cost limits.
                    ``Chapter 4--General provisions

        ``Sec. 241. Administrative provisions.
        ``Sec. 242. National Institute for Literacy.
        ``Sec. 243. National leadership activities.

SEC. 202. AMENDMENT.

    Title II is amended to read as follows:

      ``TITLE II--ADULT BASIC SKILLS AND FAMILY LITERACY EDUCATION

``SEC. 201. SHORT TITLE.

    ``This title may be cited as the `Adult Basic Skills and Family 
Literacy Education Act'.

``SEC. 202. PURPOSE.

    ``It is the purpose of this title to provide instructional 
opportunities for adults seeking to improve their basic reading, 
writing, speaking, and math skills, and support States and local 
communities in providing, on a voluntary basis, adult basic skills and 
family literacy programs, in order to--
            ``(1) increase the basic reading, writing, speaking, and 
        math skills necessary for adults to obtain employment and self-
        sufficiency and to successfully advance in the workforce;
            ``(2) assist adults in the completion of a secondary school 
        education (or its equivalent) and the transition to a 
        postsecondary educational institution;
            ``(3) increase the basic reading, writing, speaking, and 
        math skills of parents to enable them to support the 
        educational development of their children and make informed 
        choices regarding their children's education; and
            ``(4) assist immigrants who are not proficient in English 
        in improving their reading, writing, speaking, and math skills 
        and acquiring an understanding of the American free enterprise 
        system, individual freedom, and the responsibilities of 
        citizenship.

``SEC. 203. DEFINITIONS.

    ``In this title:
            ``(1) Adult basic skills and family literacy education 
        programs.--The term `adult basic skills and family literacy 
        education programs' means a sequence of academic instruction 
        and educational services below the postsecondary level that 
        increase an individual's ability to read, write, and speak in 
        English and perform mathematical computations leading to a 
        level of proficiency equivalent to secondary school completion 
        that is provided for individuals--
                    ``(A) who are at least 16 years of age;
                    ``(B) who are not enrolled or required to be 
                enrolled in secondary school under State law; and
                    ``(C) who--
                            ``(i) lack sufficient mastery of basic 
                        reading, writing, speaking, and math skills to 
                        enable the individuals to function effectively 
                        in society;
                            ``(ii) do not have a secondary school 
                        diploma or the General Equivalency Diploma 
                        (GED) (including recognized alternative 
                        standards for individuals with disabilities), 
                        and have not achieved an equivalent level of 
                        education; or
                            ``(iii) are unable to read, write, or speak 
                        the English language.
            ``(2) Eligible agency.--The term `eligible agency'--
                    ``(A) means the sole entity or agency in a State or 
                an outlying area responsible for administering or 
                supervising policy for adult basic skills and family 
                literacy education programs in the State or outlying 
                area, respectively, consistent with the law of the 
                State or outlying area, respectively; and
                    ``(B) may be the State educational agency, the 
                State agency responsible for administering workforce 
                investment activities, or the State agency responsible 
                for administering community or technical colleges.
            ``(3) Eligible provider.--The term `eligible provider' 
        means--
                    ``(A) a local educational agency;
                    ``(B) a community-based or faith-based organization 
                of demonstrated effectiveness;
                    ``(C) a volunteer literacy organization of 
                demonstrated effectiveness;
                    ``(D) an institution of higher education;
                    ``(E) a public or private educational agency;
                    ``(F) a library;
                    ``(G) a public housing authority;
                    ``(H) an institution that is not described in any 
                of subparagraphs (A) through (G) and has the ability to 
                provide adult basic skills and family literacy 
                education programs to adults and families; or
                    ``(I) a consortium of the agencies, organizations, 
                institutions, libraries, or authorities described in 
                any of subparagraphs (A) through (H).
            ``(4) English language acquisition program.--The term 
        `English language acquisition program' means a program of 
        instruction designed to help individuals with limited English 
        proficiency achieve competence in reading, writing, and 
        speaking the English language.
            ``(5) Essential components of reading instruction.--The 
        term `essential components of reading instruction' has the 
        meaning given to that term in section 1208 of the Elementary 
        and Secondary Education Act of 1965.
            ``(6) Family literacy education programs.--The term `family 
        literacy education programs' means educational programs that--
                    ``(A) assist parents and students, on a voluntary 
                basis, in achieving the purposes of this title as 
                described in section 202; and
                    ``(B) are of sufficient intensity in terms of hours 
                and of sufficient duration to make sustainable changes 
                in a family, are based upon scientific research-based 
                principles, and for the purpose of substantially 
                increasing the ability of parents and children to read, 
                write, and speak English integrate--
                            ``(i) interactive literacy activities 
                        between parents and their children;
                            ``(ii) training for parents regarding how 
                        to be the primary teacher for their children 
                        and full partners in the education of their 
                        children;
                            ``(iii) parent literacy training that leads 
                        to economic self-sufficiency; and
                            ``(iv) an age-appropriate education to 
                        prepare children for success in school and life 
                        experiences.
            ``(7) Governor.--The term `Governor' means the chief 
        executive officer of a State or outlying area.
            ``(8) Individual with a disability.--
                    ``(A) In general.--The term `individual with a 
                disability' means an individual with any disability (as 
                defined in section 3 of the Americans with Disabilities 
                Act of 1990).
                    ``(B) Individuals with disabilities.--The term 
                `individuals with disabilities' means more than one 
                individual with a disability.
            ``(9) Individual with limited english proficiency.--The 
        term `individual with limited English proficiency' means an 
        adult or out-of-school youth who has limited ability in 
        reading, writing, speaking, or understanding the English 
        language, and--
                    ``(A) whose native language is a language other 
                than English; or
                    ``(B) who lives in a family or community 
                environment where a language other than English is the 
                dominant language.
            ``(10) Institution of higher education.--The term 
        `institution of higher education' has the meaning given to that 
        term in section 101 of the Higher Education Act of 1965.
            ``(11) Literacy.--The term `literacy' means an individual's 
        ability to read, write, and speak in English, compute, and 
        solve problems proficiently.
            ``(12) Local educational agency.--The term `local 
        educational agency' has the meaning given to that term in 
        section 9101 of the Elementary and Secondary Education Act of 
        1965.
            ``(13) Outlying area.--The term `outlying area' has the 
        meaning given to that term in section 101 of this Act.
            ``(14) Postsecondary educational institution.--The term 
        `postsecondary educational institution' means--
                    ``(A) an institution of higher education that 
                provides not less than a 2-year program of instruction 
                that is acceptable for credit toward a bachelor's 
                degree;
                    ``(B) a tribally controlled community college; or
                    ``(C) a nonprofit educational institution offering 
                certificate or apprenticeship programs at the 
                postsecondary level.
            ``(15) Reading.--The term `reading' has the meaning given 
        to that term in section 1208 of the Elementary and Secondary 
        Education Act of 1965.
            ``(16) Scientifically based reading research.--The term 
        `scientifically based reading research' has the meaning given 
        to that term in section 1208 of the Elementary and Secondary 
        Education Act of 1965.
            ``(17) Secretary.--The term `Secretary' means the Secretary 
        of Education.
            ``(18) State.--The term `State' means each of the several 
        States of the United States, the District of Columbia, and the 
        Commonwealth of Puerto Rico.
            ``(19) State educational agency.--The term `State 
        educational agency' has the meaning given to that term in 
        section 9101 of the Elementary and Secondary Education Act of 
        1965.
            ``(20) Workplace literacy program.--The term `workplace 
        literacy program' means an educational program that is offered 
        in collaboration between eligible providers and employers or 
        employee organizations for the purpose of improving the 
        productivity of the workforce through the improvement of 
        reading, writing, speaking, and math skills.

``SEC. 204. HOME SCHOOLS.

    ``Nothing in this title shall be construed to affect home schools, 
whether or not a home school is treated as a home school or a private 
school under State law, or to compel a parent engaged in home schooling 
to participate in an English language acquisition program, a family 
literacy education program, or an adult basic skills and family 
literacy education program.

``SEC. 205. AUTHORIZATION OF APPROPRIATIONS.

    ``There are authorized to be appropriated to carry out this title 
$590,127,000 for fiscal year 2005 and such sums as may be necessary for 
fiscal years 2006 through 2011.

                    ``CHAPTER 1--FEDERAL PROVISIONS

``SEC. 211. RESERVATION OF FUNDS; GRANTS TO ELIGIBLE AGENCIES; 
              ALLOTMENTS.

    ``(a) Reservation of Funds.--From the sums appropriated under 
section 205 for a fiscal year, the Secretary--
            ``(1) shall reserve up to 1.72 percent for incentive grants 
        under section 213;
            ``(2) shall reserve 1.75 percent to carry out section 242; 
        and
            ``(3) shall reserve up to 1.55 percent to carry out section 
        243.
    ``(b) Grants to Eligible Agencies.--
            ``(1) In general.--From the sums appropriated under section 
        205 and not reserved under subsection (a) for a fiscal year, 
        the Secretary shall award a grant to each eligible agency 
        having a State plan approved under section 224 in an amount 
        equal to the sum of the initial allotment under subsection 
        (c)(1) and the additional allotment under subsection (c)(2) for 
        the eligible agency for the fiscal year, subject to subsections 
        (f) and (g).
            ``(2) Purpose of grants.--The Secretary may award a grant 
        under paragraph (1) only if the eligible agency involved agrees 
        to expend the grant in accordance with the provisions of this 
        title.
    ``(c) Allotments.--
            ``(1) Initial allotments.--From the sums appropriated under 
        section 205 and not reserved under subsection (a) for a fiscal 
        year, the Secretary shall allot to each eligible agency having 
        a State plan approved under section 224--
                    ``(A) $100,000, in the case of an eligible agency 
                serving an outlying area; and
                    ``(B) $250,000, in the case of any other eligible 
                agency.
            ``(2) Additional allotments.--From the sums appropriated 
        under section 205, not reserved under subsection (a), and not 
        allotted under paragraph (1), for a fiscal year, the Secretary 
        shall allot to each eligible agency that receives an initial 
        allotment under paragraph (1) an additional amount that bears 
        the same relationship to such sums as the number of qualifying 
        adults in the State or outlying area served by the eligible 
        agency bears to the number of such adults in all States and 
        outlying areas.
    ``(d) Qualifying Adult.--For the purpose of subsection (c)(2), the 
term `qualifying adult' means an adult who--
            ``(1) is at least 16 years of age;
            ``(2) is beyond the age of compulsory school attendance 
        under the law of the State or outlying area;
            ``(3) does not have a secondary school diploma or the 
        General Equivalency Diploma (GED) (including recognized 
        alternative standards for individuals with disabilities); and
            ``(4) is not enrolled in secondary school.
    ``(e) Special Rule.--
            ``(1) In general.--From amounts made available under 
        subsection (c) for the Republic of the Marshall Islands, the 
        Federated States of Micronesia, and the Republic of Palau, the 
        Secretary shall award grants to Guam, American Samoa, the 
        Commonwealth of the Northern Mariana Islands, the Republic of 
        the Marshall Islands, the Federated States of Micronesia, or 
        the Republic of Palau to carry out activities described in this 
        title in accordance with the provisions of this title as 
        determined by the Secretary.
            ``(2) Termination of eligibility.--Notwithstanding any 
        other provision of law, the Republic of the Marshall Islands, 
        the Federated States of Micronesia, and the Republic of Palau 
        shall be eligible to receive a grant under this title until an 
        agreement for the extension of United States education 
        assistance under the Compact of Free Association for each of 
        the Freely Associated States becomes effective.
            ``(3) Administrative costs.--The Secretary may provide not 
        more than 5 percent of the funds made available for grants 
        under this subsection to pay the administrative costs of the 
        Pacific Region Educational Laboratory regarding activities 
        assisted under this subsection.
    ``(f) Hold-Harmless Provisions.--
            ``(1) In general.--Notwithstanding subsection (c), and 
        subject to paragraphs (2) and (3), for fiscal year 2004 and 
        each succeeding fiscal year, no eligible agency shall receive 
        an allotment under this title that is less than 90 percent of 
        the allotment the eligible agency received for the preceding 
        fiscal year under this title.
            ``(2) Exception.--An eligible agency that receives for the 
        preceding fiscal year only an initial allotment under 
        subsection (c)(1) (and no additional allotment under subsection 
        (c)(2)) shall receive an allotment equal to 100 percent of the 
        initial allotment.
            ``(3) Ratable reduction.--If for any fiscal year the amount 
        available for allotment under this title is insufficient to 
        satisfy the provisions of paragraph (1), the Secretary shall 
        ratably reduce the payments to all eligible agencies, as 
        necessary.
    ``(g) Reallotment.--The portion of any eligible agency's allotment 
under this title for a fiscal year that the Secretary determines will 
not be required for the period such allotment is available for carrying 
out activities under this title, shall be available for reallotment 
from time to time, on such dates during such period as the Secretary 
shall fix, to other eligible agencies in proportion to the original 
allotments to such agencies under this title for such year.

``SEC. 212. PERFORMANCE ACCOUNTABILITY SYSTEM.

    ``(a) Purpose.--The purpose of this section is to establish a 
comprehensive performance accountability system, composed of the 
activities described in this section, to assess the effectiveness of 
eligible agencies in achieving continuous improvement of adult basic 
skills and family literacy education programs funded under this title, 
in order to optimize the return on investment of Federal funds in adult 
basic skills and family literacy education programs.
    ``(b) Eligible Agency Performance Measures.--
            ``(1) In general.--For each eligible agency, the eligible 
        agency performance measures shall consist of--
                    ``(A)(i) the core indicators of performance 
                described in paragraph (2)(A); and
                    ``(ii) employment performance indicators identified 
                by the eligible agency under paragraph (2)(B); and
                    ``(B) an eligible agency adjusted level of 
                performance for each indicator described in 
                subparagraph (A).
            ``(2) Indicators of performance.--
                    ``(A) Core indicators of performance.--The core 
                indicators of performance shall include the following:
                            ``(i) Measurable improvements in basic 
                        skill levels in reading, writing, and speaking 
                        the English language and basic math, leading to 
                        proficiency in each skill.
                            ``(ii) Receipt of a secondary school 
                        diploma or the General Equivalency Diploma 
                        (GED) (including recognized alternative 
                        standards for individuals with disabilities).
                            ``(iii) Placement in postsecondary 
                        education or other training programs.
                    ``(B) Employment performance indicators.--
                Consistent with applicable Federal and State privacy 
                laws, an eligible agency shall identify in the State 
                plan the following individual participant employment 
                performance indicators--
                            ``(i) entry into employment;
                            ``(ii) retention in employment; and
                            ``(iii) increase in earnings.
            ``(3) Levels of performance.--
                    ``(A) Eligible agency adjusted levels of 
                performance for core indicators.--
                            ``(i) In general.--For each eligible agency 
                        submitting a State plan, there shall be 
                        established, in accordance with this 
                        subparagraph, levels of performance for each of 
                        the core indicators of performance described in 
                        paragraph (2)(A) for adult basic skills and 
                        family literacy education programs authorized 
                        under this title. The levels of performance 
                        established under this subparagraph shall, at a 
                        minimum--
                                    ``(I) be expressed in an objective, 
                                quantifiable, and measurable form; and
                                    ``(II) show the progress of the 
                                eligible agency toward continuously and 
                                significantly improving the agency's 
                                performance outcomes in an objective, 
                                quantifiable, and measurable form.
                            ``(ii) Identification in state plan.--Each 
                        eligible agency shall identify, in the State 
                        plan submitted under section 224, expected 
                        levels of performance for each of the core 
                        indicators of performance for the first 3 
                        program years covered by the State plan.
                            ``(iii) Agreement on eligible agency 
                        adjusted levels of performance for first 3 
                        years.--In order to ensure an optimal return on 
                        the investment of Federal funds in adult basic 
                        skills and family literacy education programs 
                        authorized under this title, the Secretary and 
                        each eligible agency shall reach agreement on 
                        levels of student proficiency for each of the 
                        core indicators of performance, for the first 3 
                        program years covered by the State plan, taking 
                        into account the levels identified in the State 
                        plan under clause (ii) and the factors 
                        described in clause (iv). The levels agreed to 
                        under this clause shall be considered to be the 
                        eligible agency adjusted levels of performance 
                        for the eligible agency for such years and 
                        shall be incorporated into the State plan prior 
                        to the approval of such plan.
                            ``(iv) Factors.--The agreement described in 
                        clause (iii) or (v) shall take into account--
                                    ``(I) how the levels involved 
                                compare with the eligible agency's 
                                adjusted levels of performance, taking 
                                into account factors including the 
                                characteristics of participants when 
                                the participants entered the program; 
                                and
                                    ``(II) the extent to which such 
                                levels promote continuous and 
                                significant improvement in performance 
                                on the student proficiency measures 
                                used by such eligible agency and ensure 
                                optimal return on the investment of 
                                Federal funds.
                            ``(v) Agreement on eligible agency adjusted 
                        levels of performance for second 3 years.--
                        Prior to the fourth program year covered by the 
                        State plan, the Secretary and each eligible 
                        agency shall reach agreement on levels of 
                        student proficiency for each of the core 
                        indicators of performance for the fourth, 
                        fifth, and sixth program years covered by the 
                        State plan, taking into account the factors 
                        described in clause (iv). The levels agreed to 
                        under this clause shall be considered to be the 
                        eligible agency adjusted levels of performance 
                        for the eligible agency for such years and 
                        shall be incorporated into the State plan.
                            ``(vi) Revisions.--If unanticipated 
                        circumstances arise in a State resulting in a 
                        significant change in the factors described in 
                        clause (iv)(I), the eligible agency may request 
                        that the eligible agency adjusted levels of 
                        performance agreed to under clause (iii) or (v) 
                        be revised.
                    ``(B) Levels of employment performance.--The 
                eligible agency shall identify, in the State plan, 
                eligible agency levels of performance for each of the 
                employment performance indicators described in 
                paragraph (2)(B). Such levels shall be considered to be 
                eligible agency adjusted levels of performance for 
                purposes of this title.
    ``(c) Report.--
            ``(1) In general.--Each eligible agency that receives a 
        grant under section 211(b) shall annually prepare and submit to 
        the Secretary, the Governor, the State legislature, eligible 
        providers, and the general public within the State, a report on 
        the progress of the eligible agency in achieving eligible 
        agency performance measures, including the following:
                    ``(A) Information on the levels of performance 
                achieved by the eligible agency with respect to the 
                core indicators of performance and employment 
                performance indicators.
                    ``(B) The number and type of each eligible provider 
                that receives funding under such grant.
            ``(2) Information dissemination.--The Secretary--
                    ``(A) shall make the information contained in such 
                reports available to the general public through 
                publication and other appropriate methods;
                    ``(B) shall disseminate State-by-State comparisons 
                of the information; and
                    ``(C) shall provide the appropriate committees of 
                the Congress with copies of such reports.

``SEC. 213. INCENTIVE GRANTS FOR STATES.

    ``(a) In General.--From funds appropriated under section 211(a)(2), 
the Secretary may award grants to States for exemplary performance in 
carrying out programs under this title. Such awards shall be based on 
States meeting or exceeding the core indicators of performance 
established under section 212(b)(2)(A) and may be based on the 
performance of the State in serving populations, such as those 
described in section 224(b)(10), including the levels of service 
provided and the performance outcomes, and such other factors relating 
to the performance of the State under this title as the Secretary 
determines appropriate.
    ``(b) Use of Funds.--The funds awarded to a State under this 
paragraph may be used to carry out any activities authorized under this 
title, including demonstrations and innovative programs for hard-to-
serve populations.

                     ``CHAPTER 2--STATE PROVISIONS

``SEC. 221. STATE ADMINISTRATION.

    ``Each eligible agency shall be responsible for the following 
activities under this title:
            ``(1) The development, submission, implementation, and 
        monitoring of the State plan.
            ``(2) Consultation with other appropriate agencies, groups, 
        and individuals that are involved in, or interested in, the 
        development and implementation of activities assisted under 
        this title.
            ``(3) Coordination and avoidance of duplication with other 
        Federal and State education, training, corrections, public 
        housing, and social service programs.

``SEC. 222. STATE DISTRIBUTION OF FUNDS; MATCHING REQUIREMENT.

    ``(a) State Distribution of Funds.--Each eligible agency receiving 
a grant under this title for a fiscal year--
            ``(1) shall use an amount not less than 82.5 percent of the 
        grant funds to award grants and contracts under section 231 and 
        to carry out section 225, of which not more than 10 percent of 
        such amount shall be available to carry out section 225;
            ``(2) shall use not more than 12.5 percent of the grant 
        funds to carry out State leadership activities under section 
        223; and
            ``(3) shall use not more than 5 percent of the grant funds, 
        or $75,000, whichever is greater, for the administrative 
        expenses of the eligible agency.
    ``(b) Matching Requirement.--
            ``(1) In general.--In order to receive a grant from the 
        Secretary under section 211(b), each eligible agency shall 
        provide, for the costs to be incurred by the eligible agency in 
        carrying out the adult basic skills and family literacy 
        education programs for which the grant is awarded, a non-
        Federal contribution in an amount at least equal to--
                    ``(A) in the case of an eligible agency serving an 
                outlying area, 12 percent of the total amount of funds 
                expended for adult basic skills and family literacy 
                education programs in the outlying area, except that 
                the Secretary may decrease the amount of funds required 
                under this subparagraph for an eligible agency; and
                    ``(B) in the case of an eligible agency serving a 
                State, 25 percent of the total amount of funds expended 
                for adult basic skills and family literacy education 
                programs in the State.
            ``(2) Non-federal contribution.--An eligible agency's non-
        Federal contribution required under paragraph (1) may be 
        provided in cash or in kind, fairly evaluated, and shall 
        include only non-Federal funds that are used for adult basic 
        skills and family literacy education programs in a manner that 
        is consistent with the purpose of this title.

``SEC. 223. STATE LEADERSHIP ACTIVITIES.

    ``(a) In General.--Each eligible agency may use funds made 
available under section 222(a)(2) for any of the following adult basic 
skills and family literacy education programs:
            ``(1) The establishment or operation of professional 
        development programs to improve the quality of instruction 
        provided pursuant to local activities required under section 
        231(b), including instruction incorporating the essential 
        components of reading instruction and instruction provided by 
        volunteers or by personnel of a State or outlying area.
            ``(2) The provision of technical assistance to eligible 
        providers of adult basic skills and family literacy education 
        programs for development and dissemination of scientific 
        research-based instructional practices in reading, writing, 
        speaking, math, and English language acquisition programs.
            ``(3) The provision of assistance to eligible providers in 
        developing, implementing, and reporting measurable progress in 
        achieving the objectives of this title.
            ``(4) The provision of technology assistance, including 
        staff training, to eligible providers of adult basic skills and 
        family literacy education programs, including distance learning 
        activities, to enable the eligible providers to improve the 
        quality of such activities.
            ``(5) The development and implementation of technology 
        applications or distance learning, including professional 
        development to support the use of instructional technology.
            ``(6) Coordination with other public programs, including 
        welfare-to-work, workforce development, and job training 
        programs.
            ``(7) Coordination with existing support services, such as 
        transportation, child care, and other assistance designed to 
        increase rates of enrollment in, and successful completion of, 
        adult basic skills and family literacy education programs, for 
        adults enrolled in such activities.
            ``(8) The development and implementation of a system to 
        assist in the transition from adult basic education to 
        postsecondary education.
            ``(9) Activities to promote workplace literacy programs.
            ``(10) Activities to promote and complement local outreach 
        initiatives described in section 243(7).
            ``(11) Other activities of statewide significance, 
        including assisting eligible agencies in achieving progress in 
        improving the skill levels of adults who participate in 
        programs under this title.
    ``(b) Coordination.--In carrying out this section, eligible 
agencies shall coordinate where possible, and avoid duplicating 
efforts, in order to maximize the impact of the activities described in 
subsection (a).
    ``(c) State-Imposed Requirements.--Whenever a State or outlying 
area implements any rule or policy relating to the administration or 
operation of a program authorized under this title that has the effect 
of imposing a requirement that is not imposed under Federal law 
(including any rule or policy based on a State or outlying area 
interpretation of a Federal statute, regulation, or guideline), the 
State or outlying area shall identify, to eligible providers, the rule 
or policy as being imposed by the State or outlying area.

``SEC. 224. STATE PLAN.

    ``(a) 6-Year Plans.--
            ``(1) In general.--Each eligible agency desiring a grant 
        under this title for any fiscal year shall submit to, or have 
        on file with, the Secretary a 6-year State plan.
            ``(2) Comprehensive plan or application.--The eligible 
        agency may submit the State plan as part of a comprehensive 
        plan or application for Federal education assistance.
    ``(b) Plan Contents.--The eligible agency shall include in the 
State plan or any revisions to the State plan--
            ``(1) an objective assessment of the needs of individuals 
        in the State or outlying area for adult basic skills and family 
        literacy education programs, including individuals most in need 
        or hardest to serve;
            ``(2) a description of the adult basic skills and family 
        literacy education programs that will be carried out with funds 
        received under this title;
            ``(3) a description of how the eligible agency will 
        evaluate and measure annually the effectiveness and improvement 
        of the adult basic skills and family literacy education 
        programs based on the performance measures described in section 
        212 including--
                    ``(A) how the eligible agency will evaluate and 
                measure annually such effectiveness on a grant-by-grant 
                basis; and
                    ``(B) how the eligible agency--
                            ``(i) will hold eligible providers 
                        accountable regarding the progress of such 
                        providers in improving the academic achievement 
                        of participants in adult education programs 
                        under this title and regarding the core 
                        indicators of performance described in section 
                        212(b)(2)(A); and
                            ``(ii) will use technical assistance, 
                        sanctions, and rewards (including allocation of 
                        grant funds based on performance and 
                        termination of grant funds based on 
                        nonperformance);
            ``(4) a description of the performance measures described 
        in section 212 and how such performance measures have 
        significantly improved adult basic skills and family literacy 
        education programs in the State or outlying area;
            ``(5) an assurance that the eligible agency will, in 
        addition to meeting all of the other requirements of this 
        title, award not less than one grant under this title to an 
        eligible provider that--
                    ``(A) offers flexible schedules and necessary 
                support services (such as child care and 
                transportation) to enable individuals, including 
                individuals with disabilities, or individuals with 
                other special needs, to participate in adult basic 
                skills and family literacy education programs; and
                    ``(B) attempts to coordinate with support services 
                that are not provided under this title prior to using 
                funds for adult basic skills and family literacy 
                education programs provided under this title for 
                support services;
            ``(6) an assurance that the funds received under this title 
        will not be expended for any purpose other than for activities 
        under this title;
            ``(7) a description of how the eligible agency will fund 
        local activities in accordance with the measurable goals 
        described in section 231(d);
            ``(8) an assurance that the eligible agency will expend the 
        funds under this title only in a manner consistent with fiscal 
        requirements in section 241;
            ``(9) a description of the process that will be used for 
        public participation and comment with respect to the State 
        plan, which process--
                    ``(A) shall include consultation with the State 
                workforce investment board, the State board responsible 
                for administering community or technical colleges, the 
                Governor, the State educational agency, the State board 
                or agency responsible for administering block grants 
                for temporary assistance to needy families under title 
                IV of the Social Security Act, the State council on 
                disabilities, the State vocational rehabilitation 
                agency, other State agencies that promote the 
                improvement of adult basic skills and family literacy 
                education programs, and direct providers of such 
                programs; and
                    ``(B) may include consultation with the State 
                agency on higher education, institutions responsible 
                for professional development of adult basic skills and 
                family literacy education programs instructors, 
                representatives of business and industry, refugee 
                assistance programs, and faith-based organizations;
            ``(10) a description of the eligible agency's strategies 
        for serving populations that include, at a minimum--
                    ``(A) low-income individuals;
                    ``(B) individuals with disabilities;
                    ``(C) the unemployed;
                    ``(D) the underemployed; and
                    ``(E) individuals with multiple barriers to 
                educational enhancement, including individuals with 
                limited English proficiency;
            ``(11) a description of how the adult basic skills and 
        family literacy education programs that will be carried out 
        with any funds received under this title will be integrated 
        with other adult education, career development, and employment 
        and training activities in the State or outlying area served by 
        the eligible agency;
            ``(12) a description of the steps the eligible agency will 
        take to ensure direct and equitable access, as required in 
        section 231(c)(1), including--
                    ``(A) how the State will build the capacity of 
                community-based and faith-based organizations to 
                provide adult basic skills and family literacy 
                education programs; and
                    ``(B) how the State will increase the participation 
                of business and industry in adult basic skills and 
                family literacy education programs; and
            ``(13) a description of how the eligible agency will 
        consult with any State agency responsible for postsecondary 
        education to develop adult education that prepares students to 
        enter postsecondary education without the need for remediation 
        upon completion of secondary school equivalency programs.
    ``(c) Plan Revisions.--When changes in conditions or other factors 
require substantial revisions to an approved State plan, the eligible 
agency shall submit the revisions of the State plan to the Secretary.
    ``(d) Consultation.--The eligible agency shall--
            ``(1) submit the State plan, and any revisions to the State 
        plan, to the Governor, the chief State school officer, or the 
        State officer responsible for administering community or 
        technical colleges, or outlying area for review and comment; 
        and
            ``(2) ensure that any comments regarding the State plan by 
        the Governor, the chief State school officer, or the State 
        officer responsible for administering community or technical 
        colleges, and any revision to the State plan, are submitted to 
        the Secretary.
    ``(e) Plan Approval.--A State plan submitted to the Secretary shall 
be approved by the Secretary only if the plan is consistent with the 
specific provisions of this title.

``SEC. 225. PROGRAMS FOR CORRECTIONS EDUCATION AND OTHER 
              INSTITUTIONALIZED INDIVIDUALS.

    ``(a) Program Authorized.--From funds made available under section 
222(a)(1) for a fiscal year, each eligible agency shall carry out 
corrections education and education for other institutionalized 
individuals.
    ``(b) Uses of Funds.--The funds described in subsection (a) shall 
be used for the cost of educational programs for criminal offenders in 
correctional institutions and for other institutionalized individuals, 
including academic programs for--
            ``(1) basic skills education;
            ``(2) special education programs as determined by the 
        eligible agency;
            ``(3) reading, writing, speaking, and math programs; and
            ``(4) secondary school credit or diploma programs or their 
        recognized equivalent.
    ``(c) Priority.--Each eligible agency that is using assistance 
provided under this section to carry out a program for criminal 
offenders within a correctional institution shall give priority to 
serving individuals who are likely to leave the correctional 
institution within 5 years of participation in the program.
    ``(d) Definitions.--For purposes of this section:
            ``(1) Correctional institution.--The term `correctional 
        institution' means any--
                    ``(A) prison;
                    ``(B) jail;
                    ``(C) reformatory;
                    ``(D) work farm;
                    ``(E) detention center; or
                    ``(F) halfway house, community-based rehabilitation 
                center, or any other similar institution designed for 
                the confinement or rehabilitation of criminal 
                offenders.
            ``(2) Criminal offender.--The term `criminal offender' 
        means any individual who is charged with, or convicted of, any 
        criminal offense.

                     ``CHAPTER 3--LOCAL PROVISIONS

``SEC. 231. GRANTS AND CONTRACTS FOR ELIGIBLE PROVIDERS.

    ``(a) Grants and Contracts.--From grant funds made available under 
section 211(b), each eligible agency shall award multiyear grants or 
contracts, on a competitive basis, to eligible providers within the 
State or outlying area that meet the conditions and requirements of 
this title to enable the eligible providers to develop, implement, and 
improve adult basic skills and family literacy education programs 
within the State.
    ``(b) Local Activities.--The eligible agency shall require eligible 
providers receiving a grant or contract under subsection (a) to 
establish or operate one or more programs of instruction that provide 
services or instruction in one or more of the following categories:
            ``(1) Adult basic skills and family literacy education 
        programs (including proficiency in reading, writing, speaking, 
        and math).
            ``(2) Workplace literacy programs.
            ``(3) English language acquisition programs.
            ``(4) Family literacy education programs.
    ``(c) Direct and Equitable Access; Same Process.--Each eligible 
agency receiving funds under this title shall ensure that--
            ``(1) all eligible providers have direct and equitable 
        access to apply for grants or contracts under this section; and
            ``(2) the same grant or contract announcement process and 
        application process is used for all eligible providers in the 
        State or outlying area.
    ``(d) Measurable Goals.--The eligible agency shall require eligible 
providers receiving a grant or contract under subsection (a) to 
demonstrate--
            ``(1) the eligible provider's measurable goals for 
        participant outcomes to be achieved annually on the core 
        indicators of performance and employment performance indicators 
        described in section 212(b)(2);
            ``(2) the past effectiveness of the eligible provider in 
        improving the basic academic skills of adults and, for eligible 
        providers receiving grants in the prior year, the success of 
        the eligible provider receiving funding under this title in 
        meeting or exceeding its performance goals in the prior year;
            ``(3) the commitment of the eligible provider to serve 
        individuals in the community who are the most in need of basic 
        academic skills instruction services, including individuals who 
        are low-income or have minimal reading, writing, speaking, and 
        math skills, or limited English proficiency;
            ``(4) the program--
                    ``(A) is of sufficient intensity and duration for 
                participants to achieve substantial learning gains; and
                    ``(B) uses instructional practices that include the 
                essential components of reading instruction;
            ``(5) educational practices are based on scientifically 
        based research;
            ``(6) the activities of the eligible provider effectively 
        employ advances in technology, as appropriate, including the 
        use of computers;
            ``(7) the activities provide instruction in real-life 
        contexts, when appropriate and scientifically based, to ensure 
        that an individual has the skills needed to compete in the 
        workplace and exercise the rights and responsibilities of 
        citizenship;
            ``(8) the activities are staffed by well-trained 
        instructors, counselors, and administrators;
            ``(9) the activities are coordinated with other available 
        resources in the community, such as through strong links with 
        elementary schools and secondary schools, postsecondary 
        educational institutions, one-stop centers, job training 
        programs, community-based and faith-based organizations, and 
        social service agencies;
            ``(10) the activities offer flexible schedules and support 
        services (such as child care and transportation) that are 
        necessary to enable individuals, including individuals with 
        disabilities or other special needs, to attend and complete 
        programs;
            ``(11) the activities include a high-quality information 
        management system that has the capacity to report measurable 
        participant outcomes and to monitor program performance against 
        the performance measures established by the eligible agency;
            ``(12) the local communities have a demonstrated need for 
        additional English language acquisition programs;
            ``(13) the capacity of the eligible provider to produce 
        valid information on performance results, including enrollments 
        and measurable participant outcomes;
            ``(14) adult basic skills and family literacy education 
        programs offer rigorous reading, writing, speaking, and math 
        content that are based on scientific research; and
            ``(15) applications of technology, and services to be 
        provided by the eligible providers, are of sufficient intensity 
        and duration to increase the amount and quality of learning and 
        lead to measurable learning gains within specified time 
        periods.
    ``(e) Special Rule.--Eligible providers may use grant funds under 
this title to serve children participating in family literacy programs 
assisted under this part, provided that other sources of funds 
available to provide similar services for such children are used first.

``SEC. 232. LOCAL APPLICATION.

    ``Each eligible provider desiring a grant or contract under this 
title shall submit an application to the eligible agency containing 
such information and assurances as the eligible agency may require, 
including--
            ``(1) a description of how funds awarded under this title 
        will be spent consistent with the requirements of this title;
            ``(2) a description of any cooperative arrangements the 
        eligible provider has with other agencies, institutions, or 
        organizations for the delivery of adult basic skills and family 
        literacy education programs; and
            ``(3) each of the demonstrations required by section 
        231(d).

``SEC. 233. LOCAL ADMINISTRATIVE COST LIMITS.

    ``(a) In General.--Subject to subsection (b), of the amount that is 
made available under this title to an eligible provider--
            ``(1) at least 95 percent shall be expended for carrying 
        out adult basic skills and family literacy education programs; 
        and
            ``(2) the remaining amount shall be used for planning, 
        administration, personnel and professional development, 
        development of measurable goals in reading, writing, speaking, 
        and math, and interagency coordination.
    ``(b) Special Rule.--In cases where the cost limits described in 
subsection (a) are too restrictive to allow for adequate planning, 
administration, personnel development, and interagency coordination, 
the eligible provider may negotiate with the eligible agency in order 
to determine an adequate level of funds to be used for noninstructional 
purposes.

                    ``CHAPTER 4--GENERAL PROVISIONS

``SEC. 241. ADMINISTRATIVE PROVISIONS.

    ``(a) Supplement not Supplant.--Funds made available for adult 
basic skills and family literacy education programs under this title 
shall supplement and not supplant other State or local public funds 
expended for adult basic skills and family literacy education programs.
    ``(b) Maintenance of Effort.--
            ``(1) In general.--
                    ``(A) Determination.--An eligible agency may 
                receive funds under this title for any fiscal year if 
                the Secretary finds that the fiscal effort per student 
                or the aggregate expenditures of such eligible agency 
                for activities under this title, in the second 
                preceding fiscal year, were not less than 90 percent of 
                the fiscal effort per student or the aggregate 
                expenditures of such eligible agency for adult basic 
                skills and family literacy education programs, in the 
                third preceding fiscal year.
                    ``(B) Proportionate reduction.--Subject to 
                paragraphs (2), (3), and (4), for any fiscal year with 
                respect to which the Secretary determines under 
                subparagraph (A) that the fiscal effort or the 
                aggregate expenditures of an eligible agency for the 
                preceding program year were less than such effort or 
                expenditures for the second preceding program year, the 
                Secretary--
                            ``(i) shall determine the percentage 
                        decreases in such effort or in such 
                        expenditures; and
                            ``(ii) shall decrease the payment made 
                        under this title for such program year to the 
                        agency for adult basic skills and family 
                        literacy education programs by the lesser of 
                        such percentages.
            ``(2) Computation.--In computing the fiscal effort and 
        aggregate expenditures under paragraph (1), the Secretary shall 
        exclude capital expenditures and special one-time project 
        costs.
            ``(3) Decrease in federal support.--If the amount made 
        available for adult basic skills and family literacy education 
        programs under this title for a fiscal year is less than the 
        amount made available for adult basic skills and family 
        literacy education programs under this title for the preceding 
        fiscal year, then the fiscal effort per student and the 
        aggregate expenditures of an eligible agency required in order 
        to avoid a reduction under paragraph (1)(B) shall be decreased 
        by the same percentage as the percentage decrease in the amount 
        so made available.
            ``(4) Waiver.--The Secretary may waive the requirements of 
        this subsection for not more than 1 fiscal year, if the 
        Secretary determines that a waiver would be equitable due to 
        exceptional or uncontrollable circumstances, such as a natural 
        disaster or an unforeseen and precipitous decline in the 
        financial resources of the State or outlying area of the 
        eligible agency. If the Secretary grants a waiver under the 
        preceding sentence for a fiscal year, the level of effort 
        required under paragraph (1) shall not be reduced in the 
        subsequent fiscal year because of the waiver.

``SEC. 242. NATIONAL INSTITUTE FOR LITERACY.

    ``(a) In General.--
            ``(1) Purpose.--The purpose of the National Institute for 
        Literacy is to promote the improvement of literacy, including 
        skills in reading, writing, and English language acquisition 
        for children, youth, and adults, through practices derived from 
        the findings of scientifically based research.
            ``(2) Establishment.--There is established a National 
        Institute for Literacy (in this section referred to as the 
        `Institute'). The Institute shall be administered under the 
        terms of an interagency agreement entered into, reviewed 
        annually, and modified as needed by the Secretary of Education 
        with the Secretary of Health and Human Services and the 
        Secretary of Labor (in this section referred to as the 
        `Interagency Group').
            ``(3) Offices.--The Institute shall have offices separate 
        from the offices of the Department of Education, the Department 
        of Health and Human Services, and the Department of Labor.
            ``(4) Administrative support.--The Department of Education 
        shall provide administrative support for the Institute.
            ``(5) Daily operations.--The Director of the Institute 
        shall administer the daily operations of the Institute.
    ``(b) Duties.--
            ``(1) In general.--To carry out its purpose, the Institute 
        may--
                    ``(A) identify rigorous scientific research on the 
                effectiveness of instructional practices and 
                organizational strategies relating to programs on the 
                acquisition of skills in reading, writing, and English 
                language acquisition for children, youth, and adults;
                    ``(B) create and widely disseminate materials about 
                the acquisition and application of skills in reading, 
                writing, and English language acquisition for children, 
                youth, and adults based on scientifically based 
                research;
                    ``(C) promote a broad understanding of 
                scientifically based research on reading, writing, and 
                English language acquisition for children, youth, and 
                adults among Federal agencies with responsibilities for 
                administering programs that provide related services;
                    ``(D) facilitate coordination and information 
                sharing among national organizations and associations 
                interested in programs that provide services to improve 
                skills in reading, writing, and English language 
                acquisition for children, youth, and adults;
                    ``(E) work cooperatively with the appropriate 
                offices in the Department of Education, the Department 
                of Health and Human Services, the Department of Labor, 
                and other Federal agencies to apply the findings of 
                scientifically based research related to programs on 
                reading, writing, and English language acquisition for 
                children, youth, and adults; and
                    ``(F) establish a national electronic database and 
                Internet site describing scientifically based programs 
                on reading, writing, and English language acquisition 
                for children, youth, and adults, including professional 
                development programs.
            ``(2) Coordination.--In identifying scientifically based 
        research on reading, writing, and English language acquisition 
        for children, youth, and adults, the Institute shall use 
        standards for research quality that are consistent with those 
        established by the Institute of Education Sciences.
            ``(3) Grants, contracts, and cooperative agreements.--
                    ``(A) In general.--The Institute may award grants 
                to, or enter into contracts or cooperative agreements 
                with, individuals, public or private institutions, 
                agencies, organizations, or consortia of such 
                individuals, institutions, agencies, or organizations, 
                to carry out the activities of the Institute.
                    ``(B) Regulations.--The Director may adopt the 
                general administrative regulations of the Department of 
                Education, as applicable, for use by the Institute.
                    ``(C) Relation to other laws.--The duties and 
                powers of the Institute under this title are in 
                addition to the duties and powers of the Institute 
                under subparts 1, 2, and 3 of part B of the Elementary 
                and Secondary Education Act of 1965 (commonly referred 
                to as Reading First, Early Reading First, and the 
                William F. Goodling Even Start Family Literacy Program, 
                respectively).
    ``(c) Visiting Scholars.--The Institute may establish a visiting 
scholars program, with such stipends and allowances as the Director 
considers necessary, for outstanding researchers, scholars, and 
individuals who--
            ``(1) have careers in adult education, workforce 
        development, or scientifically based reading, writing, or 
        English language acquisition; and
            ``(2) can assist the Institute in translating research into 
        practice and providing analysis that advances instruction in 
        the fields of reading, writing, and English language 
        acquisition for children, youth, and adults.
    ``(d) Interns and Volunteers.--The Institute, in consultation with 
the National Institute for Literacy Advisory Board, may award paid and 
unpaid internships to individuals seeking to assist the Institute in 
carrying out its purpose. Notwithstanding section 1342 of title 31, 
United States Code, the Institute may accept and use voluntary and 
uncompensated services as the Institute determines necessary.
    ``(e) National Institute for Literacy Advisory Board.--
            ``(1) Establishment.--
                    ``(A) In general.--There shall be a National 
                Institute for Literacy Advisory Board (in this section 
                referred to as the `Board'), which shall consist of 7 
                individuals appointed by the President with the advice 
                and consent of the Senate.
                    ``(B) Qualifications.--The Board shall be composed 
                of individuals who--
                            ``(i) are not otherwise officers or 
                        employees of the Federal Government; and
                            ``(ii) are knowledgeable about current 
                        successful scientific research findings on 
                        instruction in reading, writing, and English 
                        language acquisition for children, youth, and 
                        adults.
                    ``(C) Composition.--The Board may include--
                            ``(i) representatives of business, 
                        industry, labor, literacy organizations, adult 
                        education providers, community colleges, and 
                        students with disabilities; and
                            ``(ii) individuals who, and representatives 
                        of entities that, have been successful in 
                        improving skills in reading, writing, and 
                        English language acquisition for children, 
                        youth, and adults.
            ``(2) Duties.--The Board shall--
                    ``(A) make recommendations to the Secretary of 
                Education concerning the appointment of the Director of 
                the Institute;
                    ``(B) provide independent advice on the operation 
                of the Institute;
                    ``(C) receive reports from the Interagency Group 
                and the Director; and
                    ``(D) review the biennial report to the Congress 
                under subsection (k).
            ``(3) Federal advisory committee act.--Except as otherwise 
        provided, the Board shall be subject to the provisions of the 
        Federal Advisory Committee Act.
            ``(4) Appointments.--
                    ``(A) In general.--Each member of the Board shall 
                be appointed for a term of 3 years, except that the 
                initial terms for members may be 1, 2, or 3 years in 
                order to establish a rotation in which one-third of the 
                members are selected each year. Any such member may be 
                appointed for not more than 2 consecutive terms.
                    ``(B) Vacancies.--Any member appointed to fill a 
                vacancy occurring before the expiration of the term for 
                which the member's predecessor was appointed shall be 
                appointed only for the remainder of that term. A member 
                may serve after the expiration of that member's term 
                until a successor has taken office.
            ``(5) Quorum.--A majority of the members of the Board shall 
        constitute a quorum, but a lesser number may hold hearings. A 
        recommendation of the Board may be passed only by a majority of 
        the Board's members present at a meeting for which there is a 
        quorum.
            ``(6) Election of officers.--The Chairperson and Vice 
        Chairperson of the Board shall be elected by the members of the 
        Board. The term of office of the Chairperson and Vice 
        Chairperson shall be 2 years.
            ``(7) Meetings.--The Board shall meet at the call of the 
        Chairperson or a majority of the members of the Board.
    ``(f) Gifts, Bequests, and Devises.--
            ``(1) In general.--The Institute may accept, administer, 
        and use gifts or donations of services, money, or property, 
        whether real or personal, tangible or intangible.
            ``(2) Rules.--The Board shall establish written rules 
        setting forth the criteria to be used by the Institute in 
        determining whether the acceptance of contributions of 
        services, money, or property whether real or personal, tangible 
        or intangible, would reflect unfavorably upon the ability of 
        the Institute or any employee to carry out the responsibilities 
        of the Institute or employee, or official duties, in a fair and 
        objective manner, or would compromise the integrity, or the 
        appearance of the integrity, of the Institute's programs or any 
        official involved in those programs.
    ``(g) Mails.--The Board and the Institute may use the United States 
mails in the same manner and under the same conditions as other 
departments and agencies of the United States.
    ``(h) Director.--The Secretary of Education, after considering 
recommendations made by the Board and consulting with the Interagency 
Group, shall appoint and fix the pay of the Director of the Institute 
and, when necessary, shall appoint an Interim Director of the 
Institute.
    ``(i) Applicability of Certain Civil Service Laws.--The Director 
and staff of the Institute may be appointed without regard to the 
provisions of title 5, United States Code, governing appointments in 
the competitive service, and may be paid without regard to the 
provisions of chapter 51 and subchapter III of chapter 53 of that title 
relating to classification and General Schedule pay rates, except that 
an individual so appointed may not receive pay in excess of the annual 
rate of basic pay payable for level IV of the Executive Schedule.
    ``(j) Experts and Consultants.--The Institute may procure temporary 
and intermittent services under section 3109(b) of title 5, United 
States Code.
    ``(k) Biennial Report.--
            ``(1) In general.--The Institute shall submit a report 
        biennially to the Committee on Education and the Workforce of 
        the House of Representatives and the Committee on Health, 
        Education, Labor, and Pensions of the Senate. Each report 
        submitted under this subsection shall include--
                    ``(A) a comprehensive and detailed description of 
                the Institute's operations, activities, financial 
                condition, and accomplishments in identifying and 
                describing programs on reading, writing, and English 
                language acquisition for children, youth, and adults 
                for the period covered by the report; and
                    ``(B) a description of how plans for the operation 
                of the Institute for the succeeding 2 fiscal years will 
                facilitate achievement of the purpose of the Institute.
            ``(2) First report.--The Institute shall submit its first 
        report under this subsection to the Congress not later than 1 
        year after the date of the enactment of the Job Training 
        Improvement Act of 2005.
    ``(l) Funding.--
            ``(1) Additional funding.--In addition to the funds 
        authorized under section 205 and reserved for the Institute 
        under section 211, the Secretary of Education, the Secretary of 
        Health and Human Services, the Secretary of Labor, or the head 
        of any other Federal agency or department that participates in 
        the activities of the Institute may provide funds to the 
        Institute for activities that the Institute is authorized to 
        perform under this section.

``SEC. 243. NATIONAL LEADERSHIP ACTIVITIES.

    ``The Secretary shall establish and carry out a program of national 
leadership activities that may include the following:
            ``(1) Technical assistance, on request, including 
        assistance--
                    ``(A) on requests to volunteer community- and 
                faith-based organizations, including but not limited 
                to, improving their fiscal management, research-based 
                instruction, and reporting requirements, and the 
                development of measurable objectives to carry out the 
                requirements of this title;
                    ``(B) in developing valid, measurable, and reliable 
                performance data, and using performance information for 
                the improvement of adult basic skills and family 
                literacy education programs;
                    ``(C) on adult education professional development; 
                and
                    ``(D) in using distance learning and improving the 
                application of technology in the classroom.
            ``(2) Providing for the conduct of research on national 
        literacy basic skill acquisition levels among adults, including 
        the number of adults functioning at different levels of reading 
        proficiency.
            ``(3) Improving the coordination, efficiency, and 
        effectiveness of adult education and workforce development 
        services at the national, State, and local levels.
            ``(4) Determining how participation in adult basic skills 
        and family literacy education programs prepares individuals for 
        entry into and success in postsecondary education and 
        employment, and in the case of prison-based services, the 
        effect on recidivism.
            ``(5) Evaluating how different types of providers, 
        including community and faith-based organizations or private 
        for-profit agencies measurably improve the skills of 
        participants in adult basic skills and family literacy 
        education programs.
            ``(6) Identifying model integrated basic and workplace 
        skills education programs, coordinated literacy and employment 
        services, and effective strategies for serving adults with 
        disabilities.
            ``(7) Supporting the development of an entity that would 
        produce and distribute technology-based programs and materials 
        for adult basic skills and family literacy education programs 
        using an intercommunication system, as that term is defined in 
        section 397 of the Communications Act of 1934, and expand the 
        effective outreach and use of such programs and materials to 
        adult education eligible providers.
            ``(8) Initiating other activities designed to improve the 
        measurable quality and effectiveness of adult basic skills and 
        family literacy education programs nationwide.''.

                       PART B--GENERAL PROVISIONS

SEC. 211. TRANSITION.

    The Secretary shall take such actions as the Secretary determines 
to be appropriate to provide for the orderly implementation of this 
title.

             TITLE III--AMENDMENTS TO THE WAGNER-PEYSER ACT

SEC. 301. AMENDMENTS TO THE WAGNER-PEYSER ACT.

    The Wagner-Peyser Act (29 U.S.C. 49 et. seq.) is amended--
            (1) by striking sections 1 through 13;
            (2) in section 14 by inserting ``of Labor'' after 
        ``Secretary''; and
            (3) by amending section 15 to read as follows:

``SEC. 15. WORKFORCE AND LABOR MARKET INFORMATION SYSTEM.

    ``(a) System Content.--
            ``(1) In general.--The Secretary of Labor, in accordance 
        with the provisions of this section, shall oversee the 
        development, maintenance, and continuous improvement of a 
        nationwide workforce and labor market information system that 
        includes--
                    ``(A) statistical data from cooperative statistical 
                survey and projection programs and data from 
                administrative reporting systems that, taken together, 
                enumerate, estimate, and project employment 
                opportunities and conditions at national, State, and 
                local levels in a timely manner, including statistics 
                on--
                            ``(i) employment and unemployment status of 
                        national, State, and local populations, 
                        including self-employed, part-time, and 
                        seasonal workers;
                            ``(ii) industrial distribution of 
                        occupations, as well as current and projected 
                        employment opportunities, wages, benefits 
                        (where data is available), and skill trends by 
                        occupation and industry, with particular 
                        attention paid to State and local conditions;
                            ``(iii) the incidence of, industrial and 
                        geographical location of, and number of workers 
                        displaced by, permanent layoffs and plant 
                        closings; and
                            ``(iv) employment and earnings information 
                        maintained in a longitudinal manner to be used 
                        for research and program evaluation;
                    ``(B) information on State and local employment 
                opportunities, and other appropriate statistical data 
                related to labor market dynamics, which--
                            ``(i) shall be current and comprehensive;
                            ``(ii) shall meet the needs identified 
                        through the consultations described in 
                        subparagraphs (A) and (B) of subsection (e)(2); 
                        and
                            ``(iii) shall meet the needs for the 
                        information identified in section 134(d);
                    ``(C) technical standards (which the Secretary 
                shall publish annually) for data and information 
                described in subparagraphs (A) and (B) that, at a 
                minimum, meet the criteria of chapter 35 of title 44, 
                United States Code;
                    ``(D) procedures to ensure compatibility and 
                additivity of the data and information described in 
                subparagraphs (A) and (B) from national, State, and 
                local levels;
                    ``(E) procedures to support standardization and 
                aggregation of data from administrative reporting 
                systems described in subparagraph (A) of employment-
                related programs;
                    ``(F) analysis of data and information described in 
                subparagraphs (A) and (B) for uses such as--
                            ``(i) national, State, and local 
                        policymaking;
                            ``(ii) implementation of Federal policies 
                        (including allocation formulas);
                            ``(iii) program planning and evaluation; 
                        and
                            ``(iv) researching labor market dynamics;
                    ``(G) wide dissemination of such data, information, 
                and analysis in a user-friendly manner and voluntary 
                technical standards for dissemination mechanisms; and
                    ``(H) programs of--
                            ``(i) training for effective data 
                        dissemination;
                            ``(ii) research and demonstration; and
                            ``(iii) programs and technical assistance.
            ``(2) Information to be confidential.--
                    ``(A) In general.--No officer or employee of the 
                Federal Government or agent of the Federal Government 
                may--
                            ``(i) use any submission that is furnished 
                        for exclusively statistical purposes under the 
                        provisions of this section for any purpose 
                        other than the statistical purposes for which 
                        the submission is furnished;
                            ``(ii) make any publication or media 
                        transmittal of the data contained in the 
                        submission described in clause (i) that permits 
                        information concerning individual subjects to 
                        be reasonably inferred by either direct or 
                        indirect means; or
                            ``(iii) permit anyone other than a sworn 
                        officer, employee, or agent of any Federal 
                        department or agency, or a contractor 
                        (including an employee of a contractor) of such 
                        department or agency, to examine an individual 
                        submission described in clause (i);
                without the consent of the individual, agency, or other 
                person who is the subject of the submission or provides 
                that submission.
                    ``(B) Immunity from legal process.--Any submission 
                (including any data derived from the submission) that 
                is collected and retained by a Federal department or 
                agency, or an officer, employee, agent, or contractor 
                of such a department or agency, for exclusively 
                statistical purposes under this section shall be immune 
                from the legal process and shall not, without the 
                consent of the individual, agency, or other person who 
                is the subject of the submission or provides that 
                submission, be admitted as evidence or used for any 
                purpose in any action, suit, or other judicial or 
                administrative proceeding.
                    ``(C) Rule of construction.--Nothing in this 
                section shall be construed to provide immunity from the 
                legal process for such submission (including any data 
                derived from the submission) if the submission is in 
                the possession of any person, agency, or entity other 
                than the Federal Government or an officer, employee, 
                agent, or contractor of the Federal Government, or if 
                the submission is independently collected, retained, or 
                produced for purposes other than the purposes of this 
                Act.
    ``(b) System Responsibilities.--
            ``(1) In general.--The workforce and labor market 
        information system described in subsection (a) shall be 
        planned, administered, overseen, and evaluated through a 
        cooperative governance structure involving the Federal 
        Government and States.
            ``(2) Duties.--The Secretary, with respect to data 
        collection, analysis, and dissemination of labor employment 
        statistics for the system, shall carry out the following 
        duties:
                    ``(A) Assign responsibilities within the Department 
                of Labor for elements of the workforce and labor market 
                information system described in subsection (a) to 
                ensure that all statistical and administrative data 
                collected is consistent with appropriate Bureau of 
                Labor Statistics standards and definitions.
                    ``(B) Actively seek the cooperation of other 
                Federal agencies to establish and maintain mechanisms 
                for ensuring complementarity and nonduplication in the 
                development and operation of statistical and 
                administrative data collection activities.
                    ``(C) Eliminate gaps and duplication in statistical 
                undertakings, with the systemization of wage surveys as 
                an early priority.
                    ``(D) In collaboration with the Bureau of Labor 
                Statistics and States, develop and maintain the 
                elements of the workforce and labor market information 
                system described in subsection (a), including the 
                development of consistent procedures and definitions 
                for use by the States in collecting the data and 
                information described in subparagraphs (A) and (B) of 
                subsection (a)(1).
                    ``(E) Establish procedures for the system to ensure 
                that--
                            ``(i) such data and information are timely;
                            ``(ii) paperwork and reporting for the 
                        system are reduced to a minimum; and
                            ``(iii) States and localities are fully 
                        involved in the development and continuous 
                        improvement of the system at all levels, 
                        including ensuring the provision, to such 
                        States and localities, of budget information 
                        necessary for carrying out their 
                        responsibilities under subsection (e).
    ``(c) National Electronic Tools to Provide Services.--The Secretary 
is authorized to assist in the development of national electronic tools 
that may be used to facilitate the delivery of core services described 
in section 134 and to provide workforce information to individuals 
through the one-stop delivery systems descried in section 121 and 
through other appropriate delivery systems.
    ``(d) Coordination With the States.--
            ``(1) In general.--The Secretary, working through the 
        Bureau of Labor Statistics and the Employment and Training 
        Administration, shall regularly consult with representatives of 
        State agencies carrying out workforce information activities 
        regarding strategies for improving the workforce and labor 
        market information system.
            ``(2) Formal consultations.--At least twice each year, the 
        Secretary, working through the Bureau of Labor Statistics, 
        shall conduct formal consultations regarding programs carried 
        out by the Bureau of Labor Statistics with representatives of 
        each of the 10 Federal regions of the Department of Labor, 
        elected from the State directors affiliated with State agencies 
        that perform the duties described in subsection (e)(2).
    ``(e) State Responsibilities.--
            ``(1) Designation of state agency.--In order to receive 
        Federal financial assistance under this section, the Governor 
        of a State shall--
                    ``(A) designate a single State agency to be 
                responsible for the management of the portions of the 
                workforce and labor market information system described 
                in subsection (a) that comprise a statewide workforce 
                and labor market information system and for the State's 
                participation in the development of the annual plan; 
                and
                    ``(B) establish a process for the oversight of such 
                system.
            ``(2) Duties.--In order to receive Federal financial 
        assistance under this section, the State agency shall--
                    ``(A) consult with State and local employers, 
                participants, and local workforce investment boards 
                about the labor market relevance of the data to be 
                collected and disseminated through the statewide 
                workforce and labor market information system;
                    ``(B) consult with State educational agencies and 
                local educational agencies concerning the provision of 
                employment statistics in order to meet the needs of 
                secondary school and postsecondary school students who 
                seek such information;
                    ``(C) collect and disseminate for the system, on 
                behalf of the State and localities in the State, the 
                information and data described in subparagraphs (A) and 
                (B) of subsection (a)(1);
                    ``(D) maintain and continuously improve the 
                statewide workforce and labor market information system 
                in accordance with this section;
                    ``(E) perform contract and grant responsibilities 
                for data collection, analysis, and dissemination for 
                such system;
                    ``(F) conduct such other data collection, analysis, 
                and dissemination activities as will ensure an 
                effective statewide workforce and labor market 
                information system;
                    ``(G) actively seek the participation of other 
                State and local agencies in data collection, analysis, 
                and dissemination activities in order to ensure 
                complementarity, compatibility, and usefulness of data;
                    ``(H) participate in the development of the annual 
                plan described in subsection (c); and
                    ``(I) utilize the quarterly records described in 
                section 136(f)(2) of the Workforce Investment Act of 
                1998 to assist the State and other States in measuring 
                State progress on State performance measures.
            ``(3) Rule of construction.--Nothing in this section shall 
        be construed as limiting the ability of a State agency to 
        conduct additional data collection, analysis, and dissemination 
        activities with State funds or with Federal funds from sources 
        other than this section.
    ``(f) Nonduplication Requirement.--None of the functions and 
activities carried out pursuant to this section shall duplicate the 
functions and activities carried out under the Carl D. Perkins 
Vocational and Applied Technology Education Act (20 U.S.C. 2301 et 
seq.).
    ``(g) Authorization of Appropriations.--There are authorized to be 
appropriated to carry out this section such sums as may be necessary 
for each of the fiscal years 2006 through 2011.
    ``(h) Definition.--In this section, the term `local area' means the 
smallest geographical area for which data can be produced with 
statistical reliability.''.

         TITLE IV--AMENDMENTS TO THE REHABILITATION ACT OF 1973

SEC. 401. FINDINGS.

    Section 2(a) of the Rehabilitation Act of 1973 (29 U.S.C. 701(a)) 
is amended--
            (1) in paragraph (5), by striking ``and'' at the end;
            (2) in paragraph (6), by striking the period and inserting 
        ``; and''; and
            (3) by adding at the end the following:
            ``(7) there is a substantial need to improve and expand 
        services for students with disabilities under this Act.''.

SEC. 402. REHABILITATION SERVICES ADMINISTRATION.

    Section 3(a) of the Rehabilitation Act of 1973 (29 U.S.C. 702(a)) 
is amended--
            (1) by striking ``Office of the Secretary'' and inserting 
        ``Department of Education'';
            (2) by striking ``President by and with the advice and 
        consent of the Senate'' and inserting ``Secretary, except that 
        the current Commissioner appointed under the authority existing 
        on the day prior to the date of enactment of the Job Training 
        Improvement Act of 2005 may continue to serve in the former 
        capacity''; and
            (3) by striking ``, and the Commissioner shall be the 
        principal officer,''.

SEC. 403. DIRECTOR.

    (a) In General.--The Rehabilitation Act of 1973 (29 U.S.C. 701 et 
seq.) is amended by striking ``Commissioner'' each place it appears, 
except in section 21, and inserting ``Director''.
    (b) Exception.--Section 21 of the Rehabilitation Act of 1973 (29 
U.S.C. 718) is amended--
            (1) in subsection (b)(1)--
                    (A) by striking ``Commissioner'' the first place it 
                appears and inserting ``Director of the Rehabilitation 
                Services Administration''; and
                    (B) by striking ``(referred to in this subsection 
                as the `Director'''; and
            (2) by striking ``Commissioner and the Director'' each 
        place it appears and inserting ``both such Directors''.

SEC. 404. DEFINITIONS.

    Section 7 of the Rehabilitation Act of 1973 (29 U.S.C. 705) is 
amended--
            (1) by redesignating paragraphs (35) through (39) as 
        paragraphs (36), (37), (38), (40), and (41), respectively;
            (2) in subparagraph (A)(ii) of paragraph (36) (as 
        redesignated in paragraph (1)), by striking ``paragraph 
        (36)(C)'' and inserting ``paragraph (37)(C)'';
            (3) by inserting after paragraph (34) the following:
            ``(35)(A) The term `student with a disability' means an 
        individual with a disability who--
                    ``(i) is not younger than 16 and not older than 21;
                    ``(ii) has been determined to be eligible under 
                section 102(a) for assistance under this title; and
                    ``(iii)(I) is eligible for, and is receiving, 
                special education under part B of the Individuals with 
                Disabilities Education Act (20 U.S.C. 1411 et seq.); or
                    ``(II) is an individual with a disability, for 
                purposes of section 504.
            ``(B) The term `students with disabilities' means more than 
        1 student with a disability.''; and
            (4) by inserting after paragraph (38) the following:
            ``(39) The term `transition services expansion year' 
        means--
                    ``(A) the first fiscal year for which the amount 
                appropriated under section 100(b) exceeds the amount 
                appropriated under section 100(b) for fiscal year 2004 
                by not less than $100,000,000; and
                    ``(B) each fiscal year subsequent to that first 
                fiscal year.''.

SEC. 405. STATE PLAN.

    (a) Coordination With Education Officials.--Section 101(a) of the 
Rehabilitation Act of 1973 (29 U.S.C. 721(a)) is amended--
            (1) in paragraph (11)(D)(i) by inserting ``, which may be 
        provided using alternative means of meeting participation (such 
        as video conferences and conference calls)'' before the 
        semicolon.
    (b) Assessment and Strategies.--Section 101(a)(15) of the 
Rehabilitation Act of 1973 (29 U.S.C. 721(a)(15)) is amended--
            (1) in subparagraph (A)
                    (A) in clause (i)--
                            (i) in subclause (II), by striking ``and'' 
                        at the end;
                            (ii) in subclause (III), by adding ``and'' 
                        at the end; and
                            (iii) by adding at the end the following:
                                    ``(IV) in a transition services 
                                expansion year, students with 
                                disabilities, including their need for 
                                transition services;''; and
                    (B) by redesignating clauses (ii) and (iii) as 
                clauses (iii) and (iv), respectively, and inserting 
                after clause (i) the following:
    ``(ii) include an assessment of the transition services provided 
under this Act, and coordinated with transition services under the 
Individuals with Disabilities Education Act, as to those services 
meeting the needs of individuals with disabilities.''; and
            (2) in subparagraph (D)--
                    (A) by redesignating clauses (iii), (iv), and (v) 
                as clauses (iv), (v), and (vi), respectively; and
                    (B) by inserting after clause (ii) the following:
                            ``(iii) in a transition services expansion 
                        year, the methods to be used to improve and 
                        expand vocational rehabilitation services for 
                        students with disabilities, including the 
                        coordination of services designed to facilitate 
                        the transition of such students from the 
                        receipt of educational services in school to 
                        the receipt of vocational rehabilitation 
                        services under this title or to postsecondary 
                        education or employment;''.
    (c) Services for Students With Disabilities.--Section 101(a) of the 
Rehabilitation Act of 1973 (29 U.S.C. 721(a)) is amended by adding at 
the end the following:
            ``(25) Services for students with disabilities.--The State 
        plan for a transition services expansion year shall provide an 
        assurance satisfactory to the Secretary that the State--
                    ``(A) has developed and implemented strategies to 
                address the needs identified in the assessment 
                described in paragraph (15), and achieve the goals and 
                priorities identified by the State, to improve and 
                expand vocational rehabilitation services for students 
                with disabilities on a statewide basis in accordance 
                with paragraph (15); and
                    ``(B) from funds reserved under section 110A, shall 
                carry out programs or activities designed to improve 
                and expand vocational rehabilitation services for 
                students with disabilities that--
                            ``(i) facilitate the transition of the 
                        students with disabilities from the receipt of 
                        educational services in school, to the receipt 
                        of vocational rehabilitation services under 
                        this title, including, at a minimum, those 
                        services specified in the interagency agreement 
                        required in paragraph (11)(D);
                            ``(ii) improve the achievement of post-
                        school goals of students with disabilities, 
                        including improving the achievement through 
                        participation (as appropriate when vocational 
                        goals are discussed) in meetings regarding 
                        individualized education programs developed 
                        under section 614 of the Individuals with 
                        Disabilities Education Act (20 U.S.C. 1414);
                            ``(iii) provide vocational guidance, career 
                        exploration services, and job search skills and 
                        strategies and technical assistance to students 
                        with disabilities;
                            ``(iv) support the provision of training 
                        and technical assistance to State and local 
                        educational agency and designated State agency 
                        personnel responsible for the planning and 
                        provision of services to students with 
                        disabilities; and
                            ``(v) support outreach activities to 
                        students with disabilities who are eligible 
                        for, and need, services under this title.''.

SEC. 406. SCOPE OF SERVICES.

    Section 103 of the Rehabilitation Act of 1973 (29 U.S.C. 723) is 
amended--
            (1) in subsection (a), by striking paragraph (15) and 
        inserting the following:
            ``(15) transition services for students with disabilities, 
        that facilitate the achievement of the employment outcome 
        identified in the individualized plan for employment, 
        including, in a transition services expansion year, services 
        described in clauses (i) through (iii) of section 
        101(a)(25)(B);''; and
            (2) in subsection (b), by striking paragraph (6) and 
        inserting the following:
            ``(6)(A)(i) Consultation and technical assistance services 
        to assist State and local educational agencies in planning for 
        the transition of students with disabilities from school to 
        post-school activities, including employment.
            ``(ii) In a transition services expansion year, training 
        and technical assistance described in section 
        101(a)(25)(B)(iv).
Consultation and technical assistance services to assist State and 
local educational agencies in planning for the transition of students 
with disabilities from school to post-school activities, including 
employment.
            ``(B) In a transition services expansion year, services for 
        groups of individuals with disabilities who meet the 
        requirements of clauses (i) and (iii) of section 7(35)(A), 
        including services described in clauses (i), (ii), (iii), and 
        (v) of section 101(a)(25)(B), to assist in the transition from 
        school to post-school activities.''.

SEC. 407. STANDARDS AND INDICATORS.

    Section 106(a) of the Rehabilitation Act of 1973 (29 U.S.C. 726(a)) 
is amended by striking paragraph (1)(C) and all that follows through 
paragraph (2) and inserting the following:
            ``(2) Measures.--The standards and indicators shall include 
        outcome and related measures of program performance that--
                    ``(A) facilitate the accomplishment of the purpose 
                and policy of this title;
                    ``(B) to the maximum extent practicable, are 
                consistent with the core indicators of performance, and 
                corresponding State adjusted levels of performance, 
                established under section 136(b) of the Workforce 
                Investment Act of 1998 (29 U.S.C. 2871(b)); and
                    ``(C) include measures of the program's performance 
                with respect to the transition to post-school 
                vocational activities, and achievement of the post-
                school vocational goals, of students with disabilities 
                served under the program.''.

SEC. 408. RESERVATION FOR EXPANDED TRANSITION SERVICES.

    The Rehabilitation Act of 1973 is amended by inserting after 
section 110 (29 U.S.C. 730) the following:

``SEC. 110A. RESERVATION FOR EXPANDED TRANSITION SERVICES.

    ``(a) Reservation.--From the State allotment under section 110 in a 
transition services expansion year, each State shall reserve an amount 
calculated by the Commissioner under subsection (b) to carry out 
programs and activities under sections 101(a)(25)(B) and 103(b)(6).
    ``(b) Calculation.--The Commissioner shall calculate the amount to 
be reserved for such programs and activities for a fiscal year by each 
State by multiplying $50,000,000 by the percentage determined by 
dividing--
            ``(1) the amount allotted to that State under section 110 
        for the prior fiscal year; by
            ``(2) the total amount allotted to all States under section 
        110 for that prior fiscal year.''.

SEC. 409. CHAIRPERSON.

    Section 705(b)(5) of the Rehabilitation Act of 1973 (29 U.S.C. 
796d(b)(5)) is amended to read as follows:
            ``(5) Chairperson.--The Council shall select a chairperson 
        from among the voting membership of the Council.''.

SEC. 410. AUTHORIZATIONS OF APPROPRIATIONS.

    The Rehabilitation Act of 1973 is further amended--
            (1) in section 100(b)(1) by striking ``fiscal years 1999 
        through 2003'' and inserting ``fiscal years 2006 through 
        2011'';
            (2) in section 100(d)(1)(B) by striking ``fiscal year 
        2003'' and inserting ``fiscal year 2009'';
            (3) in section 110(c) by amending paragraph (2) to read as 
        follows:
            ``(2) The sum referred to in paragraph (1) shall be, as 
        determined by the Secretary, not less than 1 percent and not 
        more than 1.5 percent of the amount referred to in paragraph 
        (1) for each of fiscal years 2003 through 2011.'';
            (4) in section 112(h) by striking ``fiscal years 1999 
        through 2003'' and inserting ``fiscal years 2006 through 
        2011'';
            (5) in section 201(a) by striking ``fiscal years 1999 
        through 2003'' each place it appears and inserting ``fiscal 
        years 2006 through 2011'';
            (6) in section 302(i) by striking ``fiscal years 1999 
        through 2003'' and inserting ``fiscal years 2006 through 
        2011'';
            (7) in section 303(e) by striking ``fiscal years 1999 
        through 2003'' and inserting ``fiscal years 2006 through 
        2011'';
            (8) in section 304(b) by striking ``fiscal years 1999 
        through 2003'' and inserting ``fiscal years 2006 through 
        2011'';
            (9) in section 305(b) by striking ``fiscal years 1999 
        through 2003'' and insert ``fiscal years 2006 through 2011'';
            (10) in section 405 by striking ``fiscal years 1999 through 
        2003'' and inserting ``fiscal years 2006 through 2011'';
            (11) in section 502(j) by striking ``fiscal years 1999 
        through 2003'' and inserting ``fiscal years 2006 through 
        2011'';
            (12) in section 509(i) by striking ``fiscal years 1999 
        through 2003'' and inserting ``fiscal years 2006 through 
        2011'';
            (13) in section 612 by striking ``fiscal years 1999 through 
        2003'' and inserting ``fiscal years 2006 through 2011'';
            (14) in section 628 by striking ``fiscal years 1999 through 
        2003'' and inserting ``fiscal years 2006 through 2011'';
            (15) in section 714 by striking ``fiscal years 1999 through 
        2003'' and inserting ``fiscal years 2006 through 2011'';
            (16) in section 727 by striking ``fiscal years 1999 through 
        2003'' and inserting ``fiscal years 2006 through 2011''; and
            (17) in section 753 by striking ``fiscal years 1999 through 
        2003'' and inserting ``fiscal years 2006 through 2011''.

SEC. 411. CONFORMING AMENDMENT.

    Section 1(b) of the Rehabilitation Act of 1973 is amended by 
inserting after the item relating to section 110 the following:

``Sec. 110A. Reservation for expanded transition services.''.

SEC. 412. HELEN KELLER NATIONAL CENTER ACT.

    (a) General Authorization of Appropriations.--The first sentence of 
section 205(a) of the Helen Keller National Center Act (29 U.S.C. 
1904(a)) is amended by striking ``1999 through 2003'' and inserting 
``2006 through 2011''.
    (b) Helen Keller National Center Federal Endowment Fund.--The first 
sentence of section 208(h) of such Act (29 U.S.C. 1907(h)) is amended 
by striking ``1999 through 2003'' and inserting ``2006 through 2011''.

                 TITLE V--TRANSITION AND EFFECTIVE DATE

SEC. 501. TRANSITION PROVISIONS.

    The Secretary of Labor shall take such actions as the Secretary 
determines to be appropriate to provide for the orderly implementation 
of this Act.

SEC. 502. EFFECTIVE DATE.

    Except as otherwise provided in this Act, this Act and the 
amendments made by this Act, shall take effect on the date of enactment 
of this Act.
                                 <all>
```