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PART 373—SPECIAL DEMONSTRATION PROGRAMS

Subpart A—General

373.1 What is the purpose of the Special Demonstration 

Programs?

373.2 Who is eligible for assistance?

373.3 What regulations apply?

373.4 What definitions apply?

373.5 Who is eligible to receive services and to benefit 

from activities conducted by eligible entities?

373.6 What types of projects may be funded?

373.7 What are the priorities and other factors and 

requirements for competitions?

Subpart B—How Does the Secretary Make a Grant?

373.10 What selection criteria does the Secretary use?

373.11 What other factors does the Secretary consider when 

making a grant?

Subpart C—What Conditions Must Be Met By a Grantee?

373.20 What are the matching requirements?

373.21 What are the reporting requirements?

373.22 What are the limitations on indirect costs?

373.23 What additional requirements must be met?

373.24 What are the special requirements pertaining to the 

protection, use, and release of personal information?
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AUTHORITY: Section 303(b) of the Rehabilitation Act of 

1973, as amended; 29 U.S.C. 773(b), unless otherwise noted.

Subpart A—General

§373.1 What is the purpose of the Special Demonstration 

Programs?

The purpose of this program is to provide competitive 

grants, including cooperative agreements, to, or enter into 

contracts with, eligible entities to expand and improve the 

provision of vocational rehabilitation and other services 

authorized under the Rehabilitation Act of 1973, as amended 

(Act), or to further the purposes and policies in sections 

2(b) and (c) of the Act by supporting activities that 

increase the provision, extent, availability, scope, and 

quality of rehabilitation services under the Act, including 

related research and evaluation activities.

(Authority: Sections 2(b) and (c), 7(40), 12(c), and 

303(b) of the Rehabilitation Act of 1973, as amended; 29 

U.S.C. 701(b) and (c), 705(40), 709(c), and 773(b))

§373.2 Who is eligible for assistance?

(a) The following types of organizations are eligible 

for assistance under this program:

(1) State vocational rehabilitation agencies.

(2) Community rehabilitation programs.

(3) Indian tribes or tribal organizations.
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(4) Other public or nonprofit agencies or 

organizations, including institutions of higher education.

(5) For-profit organizations, if the Secretary 

considers them to be appropriate.

(6) Consortia that meet the requirements of 34 CFR 

75.128 and 75.129.

(7) Other organizations identified by the Secretary 

and published in the FEDERAL REGISTER.

(b) In competitions held under this program, the 

Secretary may limit competitions to one or more types of 

these organizations.

(Authority: Sections 12(c) and 303(b)(2) of the 

Rehabilitation Act of 1973, as amended; 29 U.S.C. 709(c) 

and 773(b)(2))

§373.3 What regulations apply?

The following regulations apply to this program:

(a) The Education Department General Administrative 

Regulations (EDGAR) as follows:

(1) 34 CFR part 75 (Direct Grant Programs).

(2) 34 CFR part 77 (Definitions that Apply to 

Department Regulations).

(3) 34 CFR part 79 (Intergovernmental Review of 

Department of Education Programs and Activities).
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(4) 34 CFR part 81 (General Education Provisions Act—

Enforcement).

(5) 35 CFR part 82 (New Restrictions on Lobbying).

(6) 34 CFR part 84 (Governmentwide Requirements for 

Drug-Free Workplace (Financial Assistance).

(7) 34 CFR part 86 (Drug and Alcohol Abuse 

Prevention).

(8) 34 CFR part 97 (Protection of Human Subjects).

(9) 34 CFR part 98 (Student Rights in Research, 

Experimental Programs, and Testing.

(10) 34 CFR part 99 (Family Educational Rights and 

Privacy).

(b) The regulations in this part 373.

(c) The regulations in 48 CFR part 31 (Contracts Cost 

Principles and Procedures).

(d)(1) 2 CFR part 180 (Nonprocurement Debarment and 

Suspension), as adopted at 2 CFR part 3485; and

(2) 2 CFR part 200 (Uniform Administrative 

Requirements, Cost Principles, and Audit Requirements for 

Federal Awards) as adopted at 2 CFR part 3474.

(Authority: Sections 12(c) and 303(b) of the 

Rehabilitation Act of 1973, as amended; 29 U.S.C. 709(c))

and 773(b)

§373.4 What definitions apply?
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The following definitions apply to this part:

Act means the Rehabilitation Act of 1973, as amended.

(Authority: Section 2 of the Rehabilitation Act of 

1973, as amended; 29 U.S.C. 701 et seq.)

Competitive integrated employment is defined in 34 CFR 

361.5(c)(9). 

(Authority: Section 7(5) of the Rehabilitation Act of 

1973, as amended; 29 U.S.C. 705(5))

Early intervention means a service delivery or model 

demonstration program for adults with disabilities designed 

to begin the rehabilitation services as soon as possible 

after the onset or identification of actually or 

potentially disabling conditions. The populations served 

may include, but are not limited to, the following:

(1) Individuals with chronic and progressive diseases 

that may become more disabling, such as multiple sclerosis, 

progressive visual disabilities, or HIV.

(2) Individuals in the acute stages of injury or 

illness, including, but not limited to, diabetes, traumatic 

brain injury, stroke, burns, or amputation.

(Authority: Sections 12(c) and 303(b) of the 

Rehabilitation Act of 1973, as amended; 29 U.S.C. 709(c) 

and 773(b))

Employment outcome is defined in 34 CFR 361.5.
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(Authority: Section 7(11) of the Rehabilitation Act 

of 1973, as amended; 29 U.S.C. 705(11))

Individual with a disability is defined as follows:

(1) For an individual who will receive rehabilitation 

services under this part, an individual with a disability 

means an individual—

(i) Who has a physical or mental impairment which, 

for that individual, constitutes or results in a 

substantial impediment to employment; and

(ii) Who can benefit in terms of an employment 

outcome from vocational rehabilitation services.

(2) For all other purposes of this part, an 

individual with a disability means an individual—

(i) Who has a physical or mental impairment that 

substantially limits one or more major life activities;

(ii) Who has a record of such an impairment; or

(iii) Who is regarded as having such an impairment.

(3) For purposes of paragraph (b) of this definition, 

projects that carry out services or activities pertaining 

to Title V of the Act must also meet the requirements for 

“an individual with a disability” in section 7(20)(c) 

through (e) of the Act, as applicable.

(Authority: Section 7(20) of the Rehabilitation Act 

of 1973, as amended; 29 U.S.C. 705(20))
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Individual with a significant disability means an 

individual—

(1) Who has a severe physical or mental impairment 

that seriously limits one or more functional capacities 

(such as mobility, communication, self-care, selfdirection, interpersonal skills, work tolerance, or work 

skills) in terms of an employment outcome;

(2) Whose vocational rehabilitation can be expected 

to require multiple vocational rehabilitation services over 

an extended period of time; and

(3) Who has one or more physical or mental 

disabilities resulting from amputation, arthritis, autism, 

blindness, burn injury, cancer, cerebral palsy, cystic

fibrosis, deafness, head injury, heart disease, hemiplegia, 

hemophilia, intellectual disability, respiratory or 

pulmonary dysfunction, mental illness, multiple sclerosis, 

muscular dystrophy, musculo-skeletal disorders, 

neurological disorders (including stroke and epilepsy), 

paraplegia, quadriplegia and other spinal cord conditions, 

sickle-cell anemia, specific learning disabilities, endstage renal disease, or another disability or combination 

of disabilities determined on the basis of an assessment 

for determining eligibility and vocational rehabilitation 
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needs to cause comparable substantial functional 

limitation.

(Authority: Section 7(21)(A) of the Rehabilitation 

Act of 1973, as amended; 29 U.S.C. 705(21)(A))

Informed choice means the provision of activities 

whereby individuals with disabilities served by projects 

under this part have the opportunity to be active, full 

partners in the rehabilitation process, making meaningful 

and informed choices as follows:

(1) During assessments of eligibility and vocational 

rehabilitation needs.

(2) In the selection of employment outcomes, services 

needed to achieve the outcomes, entities providing these 

services, and the methods used to secure these services.

(Authority: Sections 2(c) and 12(c) of the Act 29 

U.S.C. 701(c) and 709(c))

Rehabilitation services means services, including 

vocational, medical, social, and psychological 

rehabilitation services and other services under the 

Rehabilitation Act, provided to individuals with 

disabilities in performing functions necessary in preparing 

for, securing, retaining, or regaining an employment or 

independent living outcome.
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(Authority: Section 12(c) of the Rehabilitation Act 

of 1973, as amended; 29 U.S.C. 709(c))

Substantial impediment to employment means that a 

physical or mental impairment (in light of attendant 

medical, psychological, vocational, educational, and other 

related factors) hinders an individual from preparing for, 

entering into, engaging in, or retaining employment 

consistent with the individual's capacities and abilities.

(Authority: Section 5(20)(A) of the Act 29; U.S.C. 

705(20)(A))

Supported employment is defined in 34 CFR 

361.5(c)(53).

(Authority: Section 5(38) of the Rehabilitation Act 

of 1973, as amended; 29 U.S.C. 705(38))

Vocational Rehabilitation Services means services 

provided to an individual with a disability in preparing 

for, securing, retaining, or regaining an employment 

outcome that is consistent with the strengths, resources, 

priorities, concerns, abilities, capabilities, interests, 

and informed choice of the individual. Vocational 

Rehabilitation Services for an individual with a disability 

may include—

(1) An assessment for determining eligibility and 

vocational rehabilitation needs by qualified personnel, 
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including, if appropriate, an assessment by personnel 

skilled in rehabilitation technology;

(2) Counseling and guidance, including information 

and support services to assist an individual in exercising 

informed choice;

(3) Referral and other services to secure needed 

services from other agencies;

(4) Job-related services, including job search and 

placement assistance, job retention services, follow-up 

services, and follow-along services;

(5) Vocational and other training services, including 

the provision of personal and vocational adjustment 

services, books, tools, and other training materials;

(6) Diagnosis and treatment of physical and mental 

impairments;

(7) Maintenance for additional costs incurred while 

the individual is receiving services;

(8) Transportation;

(9) On-the-job or other related personal assistance 

services;

(10) Interpreter and reader services;

(11) Rehabilitation teaching services, and 

orientation and mobility services;
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(12) Occupational licenses, tools, equipment, and 

initial stocks and supplies;

(13) Technical assistance and other consultation 

services to conduct market analysis, develop business 

plans, and otherwise provide resources to eligible 

individuals who are pursuing self-employment or 

telecommuting or establishing a small business operation as 

an employment outcome;

(14) Rehabilitation technology, including 

telecommunications, sensory, and other technological aids 

and devices;

(15) Transition services for individuals with 

disabilities that facilitate the achievement of employment 

outcomes;

(16) Supported employment services;

(17) Services to the family of an individual with a 

disability necessary to assist the individual to achieve an 

employment outcome;

(18) Post-employment services necessary to assist an 

individual with a disability to retain, regain, or advance 

in employment; and

(19) Expansion of employment opportunities for 

individuals with disabilities, which includes, but is not 

limited to—
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(i) Self-employment, business ownership, and 

entreprenuership;

(ii) Non-traditional jobs, professional employment, 

and work settings;

(iii) Collaborating with employers, Economic 

Development Councils, and others in creating new jobs and 

career advancement options in local job markets through the 

use of job restructuring and other methods; and

(iv) Other services as identified by the Secretary 

and published in the FEDERAL REGISTER.

(Authority: Sections 7(40), 12(c), and 103(a) of the 

Rehabilitation Act of 1973, as amended; 29 U.S.C. 

705(40), 709(c) and 723(a))

Youth or Young adults with disabilities means 

individuals with disabilities who are between the ages of 

14 and 24 inclusive when entering the program.

(Authority: Section 5(42) of the Rehabilitation Act 

of 1973, as amended; 29 U.S.C. 705(42)

§373.5 Who is eligible to receive services and to benefit 

from activities conducted by eligible entities?

(a)(1) For projects that provide rehabilitation 

services or activities to expand and improve the provision 

of rehabilitation services and other services authorized 

under Titles I, III, and VI of the Act, individuals are 
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eligible who meet the definition in paragraph (a) of an 

“individual with a disability” as stated in §373.4.

(2) For projects that provide independent living 

services or activities, individuals are eligible who meet 

the definition in paragraph (b) of an “individual with a 

disability” as stated in §373.4.

(3) For projects that provide other services or 

activities that further the purposes of the Act, 

individuals are eligible who meet the definition in 

paragraph (b) of an “individual with a disability” as 

stated in §373.4.

(b) By publishing a notice in the FEDERAL REGISTER, 

the Secretary may identify individuals determined to be 

eligible under one or more of the provisions in paragraph 

(a) of this section.

(Authority: Sections 12(c), 103(a), and 303(b) of the 

Rehabilitation Act of 1973, as amended; 29 U.S.C. 709(c),

723(a), and 773(b))

§373.6 What types of projects may be funded?

The Secretary may fund the following types of projects 

under this program: 

(a) Special projects of service delivery. 

(b) Model demonstration. 

(c) Technical assistance. 
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(d) Systems change.

(e) Special studies, research, or evaluations.

(f) Dissemination and utilization.

(Authority: Sections 12(c) and 303(b)(4) of the 

Rehabilitation Act of 1973, as amended; 29 U.S.C. 709(c) 

and 773(b)(4))

§373.7 What are the priorities and other factors and 

requirements for competitions? 

(a) In announcing competitions for grants and 

contracts, the Secretary gives priority consideration to –

(1) Initiatives focused on improving transition from 

education, including postsecondary education, to 

employment, particularly in competitive integrated 

employment, for youth who are individuals with significant 

disabilities. 

(2) Supported employment, including community-based 

supported employment programs to meet the needs of 

individuals with the most significant disabilities or to 

provide technical assistance to States and community 

organizations to improve and expand the provision of 

supported employment services. 

(3) Increasing competitive integrated employment for 

individuals with significant disabilities.
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(b) In announcing competitions for grants and 

contracts, the Secretary may also identify one or more of 

the following as priorities –

(1) Expansion of employment opportunities for 

individuals with disabilities, as authorized in 

paragraph(s) of the definition of “vocational 

rehabilitation services” as stated in §373.4.

(2) System change projects to promote meaningful 

access of individuals with disabilities to employmentrelated services under subtitle B of title I of the 

Workforce Innovation and Opportunity Act and under other 

Federal laws.

(3) Innovative methods of promoting achievement of 

high-quality employment outcomes.

(4) The demonstration of the effectiveness of early 

intervention activities in improving employment outcomes.

(5) Projects to find alternative methods of providing 

affordable transportation services to individuals with 

disabilities.

(6) Technical assistance to designated State units 

and their personnel in working with employers to identify 

competitive integrated employment opportunities and career 

exploration opportunities in order to facilitate the 

provision of vocational rehabilitation services and 
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transition services for youth with disabilities and 

students with disabilities.

(7) Consultation, training and technical assistance 

to businesses that have hired or are interested in hiring 

individuals with disabilities.

(8) Technical assistance and training to designated 

State units and their personnel on establishment and 

maintenance of education and experience requirements, to 

ensure that the personnel have a 21st century understanding 

of the evolving labor force and the needs of individuals 

with disabilities.

(9) Technical assistance to State vocational 

rehabilitation agencies or State vocational rehabilitation 

units to improve management practices that will improve the 

provision of vocational rehabilitation services and 

increase competitive employment outcomes for individuals 

with disabilities. 

(10) Other projects that will expand and improve the 

provision, extent, availability, scope, and quality of 

rehabilitation and other services under the Act or that 

further the purpose and policy of the Act as stated in 

sections 2(b) and (c) of the Act.

(c) In announcing competitions of grants and contract 

the Secretary may limit the priorities listed in paragraphs 
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(a) and (b) of this section to address one or more of the 

following factors:

(1) Age ranges. 

(2) Types of disabilities. 

(3) Types of services. 

(4) Models of service delivery. 

(5) Stages of the vocational rehabilitation process; 

(6) Unserved and underserved populations.

(7) Unserved and underserved geographical areas.

(8) Individuals with significant disabilities.

(9) Low-incidence disability populations.

(10) Individuals residing in federally designated 

Empowerment Zones and Enterprise Communities. 

(d) The Secretary may require that an applicant 

certify that the project does not include building upon or 

expanding activities that have previously been conducted or 

funded, for that applicant or in that service area.

(e) The Secretary may require that the project widely 

disseminate the methods of vocational rehabilitation 

service delivery or model proven to be effective, so that 

they may be adapted, replicated, or purchased under feefor-service arrangements by State vocational rehabilitation 

agencies and other disability organizations in the 

project's targeted service area or other locations.
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(Authority: Sections 12(c), 101(a)(7)(B)(ii) and 

(11)(E), 103(b)(5), 108a, and 303(b)(5) of the 

Rehabilitation Act of 1973, as amended; 29 U.S.C. 709(c), 

721(a)(7)(B)(ii) and (11)(E), 723(b)(5), 728a, and 

773(b)(5))

Subpart B—How Does the Secretary Make a Grant?

§373.10 What selection criteria does the Secretary use?

The Secretary publishes in the FEDERAL REGISTER or 

includes in the application package the selection criteria 

for each competition under this program. To evaluate the 

applications for new grants under this program, the 

Secretary may use the following:

(a) Selection criteria established under 34 CFR 

75.209.

(b) Selection criteria in 34 CFR 75.210.

(c) Any combination of selection criteria from 

paragraphs (a) and (b) of this section.

(Authority: Sections 12(c) and 103(a) of the 

Rehabilitation Act of 1973, as amended; 29 U.S.C. 709(c) 

and 723(a))

§373.11 What other factors does the Secretary consider 

when making a grant?
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(a) The Secretary funds only those applications 

submitted in response to competitions announced in the 

FEDERAL REGISTER.

(b) The Secretary may consider the past performance 

of the applicant in carrying out activities under 

previously awarded grants.

(c) The Secretary awards bonus points if identified 

and published in the FEDERAL REGISTER for specific 

competitions.

(Authority: Sections 12(c) and 103(a) of the 

Rehabilitation Act of 1973, as amended; 29 U.S.C. 709(c) 

and 723(a))

Subpart C—What Conditions Must Be Met By a Grantee?

§373.20 What are the matching requirements?

The Secretary may make grants to pay all or part of 

the cost of activities covered under this program. If the 

Secretary determines that the grantee is required to pay 

part of the costs, the amount of grantee participation is 

specified in the application notice, and the Secretary will 

not require grantee participation to be more than 10 

percent of the total cost of the project.

(Authority: Sections 12(c) and 303(b)(1) of the 

Rehabilitation Act of 1973, as amended; 29 U.S.C. 709(c) 

and 773(b)(1))
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§373.21 What are the reporting requirements?

(a) In addition to the program and fiscal reporting 

requirements in 34 CFR 75.720 and 2 CFR 200.327 that are 

applicable to projects funded under this program, the 

Secretary may require that recipients of grants under this 

part submit information determined by the Secretary to be 

necessary to measure project outcomes and performance, 

including any data needed to comply with the Government 

Performance and Results Act.

(b) Specific reporting requirements for competitions 

will be identified by the Secretary and published in the 

FEDERAL REGISTER.

(Authority: Sections 12(c), 303(b)(2)(B), and 306 of 

the Rehabilitation Act of 1973, as amended; 29 U.S.C. 

709(c), 773(b)(2)(B), and 776)

§373.22 What are the limitations on indirect costs?

(a) Indirect cost reimbursement for grants under this 

program is limited to the recipient's actual indirect 

costs, as determined by its negotiated indirect cost rate 

agreement, or 10 percent of the total direct cost base, 

whichever amount is less.

(b) Indirect costs in excess of the 10 percent limit 

may be used to satisfy matching or cost-sharing 

requirements.
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(c) The 10 percent limit does not apply to federally 

recognized Indian tribal governments and their tribal 

representatives.

(Authority: Section 12(c) of the Rehabilitation Act 

of 1973, as amended; 29 U.S.C. 709(c))

§373.23 What additional requirements must be met?

(a) Each grantee must do the following:

(1) Ensure equal access and treatment for eligible 

project participants who are members of groups that have 

traditionally been underrepresented based on race, color, 

national origin, gender, age, or disabilities.

(2) Encourage applications for employment from 

persons who are members of groups that have traditionally 

been underrepresented based on race, color, national 

origin, gender, age, or disabilities.

(3) Advise individuals with disabilities who are 

applicants for or recipients of the services, or the 

applicants' representatives or the individuals' 

representatives, of the availability and purposes of the 

Client Assistance Program, including information on means 

of seeking assistance under that program.

(4) Provide, through a careful appraisal and study, 

an assessment and evaluation of the project that indicates 
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the significance or worth of processes, methodologies, and 

practices implemented by the project.

(b) A grantee may not make a subgrant under this 

part. However, a grantee may contract for supplies, 

equipment, and other services, in accordance with 2 CFR 

part 200 (Uniform Administrative Requirements, Cost 

Principles, and Audit Requirements for Federal Awards) as 

adopted at 2 CFR part 3474.

(Authority: Sections 12(c) and 303(b)(2)(B) of the 

Rehabilitation Act of 1973, as amended; 29 U.S.C. 709(c) 

and 773(b)(2)(B))

§373.24 What are the special requirements pertaining to 

the protection, use, and release of personal information?

(a) All personal information about individuals served 

by any project under this part, including lists of names, 

addresses, photographs, and records of evaluation, must be 

confidential.

(b) The use of information and records concerning 

individuals must be limited only to purposes directly 

connected with the project, including project reporting and 

evaluation activities. This information may not be 

disclosed, directly or indirectly, other than in the 

administration of the project unless the consent of the 

agency providing the information and the individual to whom 
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the information applies, or his or her representative, has 

been obtained in writing. The Secretary or other Federal 

officials responsible for enforcing legal requirements have 

access to this information without written consent being 

obtained. The final products of the project may not reveal 

any personal identifying information without written 

consent of the individual or his or her representative.

(Authority: Sections 12(c) and 303(b)(2)(B) of the 

Rehabilitation Act of 1973, as amended; 29 U.S.C. 709(c), 

and 773(b)(2)(B))