PART 363—THE STATE SUPPORTED EMPLOYMENT SERVICES PROGRAM 

Table of Contents 

Subpart A—General ...................................................................................................................................... 1

§ 363.1 What is the State Supported Employment Services Program? ....................................................... 1

§ 363.2 Who is eligible for an award? ........................................................................................................... 1

§ 363.3 Who is eligible for services? ............................................................................................................ 1

§ 363.4 What are the authorized activities under a State Supported Employment Services grant? ............ 1

§ 363.5 What regulations apply? .................................................................................................................. 2

§ 363.6 What definitions apply? .................................................................................................................... 2

Subpart B—How Does a State Apply for a Grant? ....................................................................................... 4

§ 363.10 What documents must a State submit to receive a grant? ............................................................ 4

§ 363.11 What information and assurances must be included in the State plan supplement? .................... 4

Subpart C—How Does the Secretary Make a Grant? .................................................................................. 5

§ 363.20 How does the Secretary allocate funds? ....................................................................................... 5

§ 363.21 How does the Secretary reallocate funds? .................................................................................... 5

Subparts D–E [Reserved] ............................................................................................................................. 5

Subpart F—What Post-Award Conditions Must Be Met by a State? ............................................................ 5

§ 363.50 What collaborative agreements must the State develop? ............................................................. 5

§ 363.51 What are the allowable administrative costs? ................................................................................ 5

§ 363.52 What are the information collection and reporting requirements? ................................................. 6

§ 363.53 What special conditions apply to services and activities under this program? .............................. 6

§ 363.54 What requirements must a State meet before it provides for the transition of an individual to 

extended services? ....................................................................................................................................... 6

§ 363.55 What are the requirements for successfully rehabilitating an individual in supported 

employment? ................................................................................................................................................. 6

§ 363.56 What notice requirements apply to this program? ......................................................................... 6
PART 363—THE STATE 

SUPPORTED EMPLOYMENT 

SERVICES PROGRAM 

Subpart A—General 

Sec. 

363.1 What is the State Supported Employment 

Services Program? 

363.2 Who is eligible for an award? 

363.3 Who is eligible for services? 

363.4 What are the authorized activities under a 

State Supported Employment Services grant? 

363.5 What regulations apply? 

363.6 What definitions apply? 

Subpart B—How Does a State Apply for a 

Grant? 

363.10 What documents must a State submit to 

receive a grant? 

363.11 What information and assurances must 

be included in the State plan supplement? 

Subpart C—How Does the Secretary Make a 

Grant? 

363.20 How does the Secretary allocate funds? 

363.21 How does the Secretary reallocate 

funds? 

Subparts D–E [Reserved] 

Subpart F—What Post-Award Conditions 

Must Be Met by a State? 

363.50 What collaborative agreements must the 

State develop? 

363.51 What are the allowable administrative 

costs? 

363.52 What are the information collection and 

reporting requirements? 

363.53 What special conditions apply to services 

and activities under this program? 

363.54 What requirements must a State meet 

before it provides for the transition of an 

individual to extended services? 

363.55 What are the requirements for 

successfully rehabilitating an individual in 

supported employment? 

363.56 What notice requirements apply to this 

program? 

AUTHORITY: 29 U.S.C. 795j–q, unless 

otherwise noted. 

SOURCE: 59 FR 8331, Feb. 18, 1993, unless 

otherwise noted. 

Subpart A—General 

§ 363.1 What is the State Supported 

Employment Services Program? 

Under the State Supported Employment 

Services Program, the Secretary provides grants 

to assist States in developing and implementing 

collaborative programs with appropriate entities 

to provide programs of supported employment 

services for individuals with the most severe 

disabilities who require supported employment 

services to enter or retain competitive 

employment. 

(Authority: 29 U.S.C. 795j) 

§ 363.2 Who is eligible for an award? 

Any State is eligible for an award under this 

program. 

(Authority: 29 U.S.C. 795n) 

§ 363.3 Who is eligible for services? 

A State may provide services under this 

program to any individual if— 

(a) The individual has been determined 

eligible for vocational rehabilitation services in 

accordance with the criteria in section 102(a)(1) 

of the Act; 

(b) The individual has been determined to be 

an individual with the most severe disabilities; 

and 

(c) Supported employment has been identified 

as the appropriate rehabilitation objective for the 

individual on the basis of a comprehensive 

assessment of rehabilitation needs, including an 

evaluation of rehabilitation, career, and job 

needs. 

(Authority: 29 U.S.C. 795m) 

§ 363.4 What are the authorized 

activities under a State Supported 

Employment Services grant? 

Under this program, the following activities are 

authorized: 

(a) Any particularized assessment that is 

needed to supplement the comprehensive 

assessment of rehabilitation needs done under 

34 CFR part 361 and that is provided 

subsequent to the development of the 

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individualized written rehabilitation program. The 

supplementary assessment may be provided 

in circumstances such as the following: 

(1) A reassessment of the suitability of the 

placement is warranted. 

(2) There is a change in the individual’s 

medical condition. 

(b) Development of and placement in jobs for 

individuals with the most severe disabilities. 

(c) Provision of supported employment 

services that are needed to support individuals 

with the most severe disabilities in employment, 

such as— 

(1) Intensive on-the-job skills training and 

other training provided by skilled job trainers, coworkers, and other qualified individuals, and 

other services specified in section 103(a) of the 

Act in order to achieve and maintain job stability; 

(2) Follow-up services, including regular 

contact with employers, trainees with the most 

severe disabilities, parents, guardians or other 

representatives of trainees, and other suitable 

professional and informed advisors in order to 

reinforce and stabilize the job placement; and 

 (3) Discrete post-employment services 

following transition that are unavailable from an 

extended services provider and that are 

necessary to maintain the job placement, such 

as job station redesign, repair and maintenance 

of assistive technology, and replacement of 

prosthetic and orthotic devices. 

(Authority: 29 U.S.C. 795l) 

§ 363.5 What regulations apply? 

The following regulations apply to the State 

Supported Employment Services Program: 

(a) The Education Department General 

Administrative Regulations (EDGAR) as follows: 

(1) 34 CFR part 76 (State-Administered 

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). 

(4) 34 CFR part 80 (Uniform Administrative 

Requirements for Grants and Cooperative 

Agreements to State and Local Governments). 

(5) 34 CFR part 81 (General Education 

Provisions Act—Enforcement). 

(6) 34 CFR part 82 (New Restrictions on 

Lobbying). 

(7) 34 CFR part 85 (Governmentwide 

Debarment and Suspension (Nonprocurement) 

and Governmentwide Requirements for DrugFree Workplace (Grants)). 

(8) 34 CFR part 86 (Drug-Free Schools and 

Campuses). 

(b) The regulations in this part 363. 

(c) The following regulations in 34 CFR part 

361 (The State Vocational Rehabilitation 

Services Program): 

§§ 361.31; 361.32; 361.33; 361.34; 361.35; 

361.39; 361.40; 361.41; 361.42; 361.47(a); 

361.48; and 361.49. 

NOTE: Many of the regulatory provisions 

cross-referenced in § 363.5(c) are affected by 

statutory changes made by the Rehabilitation 

Act Amendments of 1992. If these provisions 

conflict with statutory language, they are 

superseded by the statutory language. 

Program regulations for part 361 are being 

amended to implement statutory changes. 

When final regulations for part 361 are 

published, these cross-references will be 

corrected, if necessary. 

(Authority: 29 U.S.C. 795j and 711(c)) 

§ 363.6 What definitions apply? 

(a) Definitions in 34 CFR part 361. The 

following terms used in this part are defined in 

34 CFR 369.4(b): 

Act 

Designated State unit 

Individual with disabilities 

Individual with severe disabilities 

State plan

(b) Definitions in EDGAR. The following terms 

used in this part are defined in 34 CFR 77.1: 

Fiscal Year 

Nonprofit 

Private Secretary 

State 

(c) Other definitions. The following definitions 

also apply to this part: 

(1) Supported employment means— 

(i) Competitive employment in an integrated 

setting with ongoing support services for 

individuals with the most severe disabilities— 

(A) For whom competitive employment has 

not traditionally occurred or for whom 

competitive employment has been interrupted or 

intermittent as a result of a severe disability; and 

(B) Who, because of the nature and severity 

of their disabilities, need intensive supported 

employment services from the designated State 

unit and extended services after transition in 

order to perform this work; or 

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(ii) Transitional employment for individuals 

with the most severe disabilities due to mental 

illness. 

(2) As used in the definition of ‘‘Supported 

employment’’— 

(i) Competitive employment means work— 

(A) In the competitive labor market that is 

performed on a full-time or part-time basis in an 

integrated setting; and 

(B) For which an individual is compensated at 

or above the minimum wage, but not less than 

the customary or usual wage paid by the 

employer for the same or similar work performed 

by individuals who are not disabled. 

(ii) Integrated setting means a setting typically 

found in the community in which an individual 

with the most severe disabilities interacts with 

non-disabled individuals, other than nondisabled individuals who are providing services 

to that individual, to the same extent that nondisabled individuals in comparable positions 

interact with other persons. 

(iii) Supported employment services means 

on-going support services provided by the 

designated State unit with funds under this 

part— 

(A) For a period not to exceed 18 months, 

unless under special circumstances a longer 

period to achieve job stabilization has been 

jointly agreed to by the individual and the 

rehabilitation counselor and established 

in the individualized written rehabilitation 

program, before an individual with the most 

severe disabilities makes the transition to 

extended services; and 

(B) As discrete post-employment services 

following transition in accordance with 

§363.4(c)(3); 

(iv) Extended services means on-going 

support services and other appropriate services 

provided by a State agency, a private nonprofit 

organization, employer, or any other appropriate 

resource, from funds other than funds received 

under this part, part 381, part 376, or part 380, 

after an individual with the most severe 

disabilities has made the transition from State 

vocational rehabilitation agency support; and 

(v) Transitional employment means a series of 

temporary job placements in competitive work in 

an integrated work setting with on-going support 

services for individuals with the most severe 

disabilities due to mental illness. In transitional 

employment, the provision of on-going support 

services must include continuing sequential job 

placements until job permanency is achieved. 

(3) On-going support services means services 

that are— 

(i) Needed to support and maintain an 

individual with the most severe disabilities in 

supported employment; 

(ii) Based on a determination by the 

designated State unit of the individual’s needs 

as specified in an individualized written 

rehabilitation program; and 

(iii) Furnished by the designated State unit 

from the time of job placement until transition to 

extended services, except as provided in 

§363.4(c)(3) and, following transition, by one or 

more extended services providers throughout 

the individual’s term of employment in a 

particular job placement or multiple placements 

if those placements are being provided under a 

program of transitional employment. On-going 

support services must include, at a minimum, 

twice-monthly monitoring at the work site of 

each individual in supported employment to 

assess employment stability, unless under 

special circumstances, especially at the request 

of the individual, the individualized written 

rehabilitation program provides for off-site 

monitoring, and, based upon that assessment, 

the coordination or provision of specific services 

at or away from the work site, that are needed to 

maintain employment stability. If off-site 

monitoring is determined to be appropriate, it 

must, at a minimum, consist of two meetings 

with the individual and one contact with the 

employer each month. Ongoing support services 

consist of— 

(A) Any particularized assessment needed to 

supplement the comprehensive assessment of 

rehabilitation needs; 

(B) The provision of skilled job trainers who 

accompany the individual for intensive job skill 

training at the work site; 

(C) Job development and placement; 

(D) Social skills training; 

(E) Regular observation or supervision of the 

individual; 

(F) Follow-up services such as regular contact 

with the employers, the individuals, the parents, 

family members, guardians, advocates or 

authorized representatives of the individuals, 

and other suitable professional and informed 

advisors, in order to reinforce and stabilize the 

job placement; 

(G) Facilitation of natural supports at the 

worksite; 

(H) Any other service identified in the scope of 

rehabilitation services described in 34 CFR part 

361; and 

3 
(I) Any service similar to the foregoing 

services. 

(Authority: 29 U.S.C. 706(18), 711(c), and 795j) 

[59 FR 8331, Feb. 18, 1993, as amended at 62 

FR 6363, Feb. 11, 1997] 

Subpart B—How Does a State 

Apply for a Grant? 

§ 363.10 What documents must a 

State submit to receive a grant? 

To receive a grant under this part, a State must 

submit to the Secretary, as part of the State plan 

under 34 CFR part 361, a State plan supplement 

that meets the requirements of § 363.11. 

(Authority: 29 U.S.C. 795n) 

§ 363.11 What information and 

assurances must be included in the 

State plan supplement? 

Each State plan supplement must include the 

following: 

(a) Designated State agency. Designate the 

State unit or units for vocational rehabilitation 

services identified in the State plan submitted 

under 34 CFR part 361 as the State agency or 

agencies to administer this program. 

(b) Results of needs assessment. Summarize 

the results of the needs assessment of 

individuals with severe disabilities conducted 

under title I of the Act with respect to the 

rehabilitation and career needs of individuals 

with severe disabilities and the need for 

supported employment services. The results of 

the needs assessment must address the 

coordination and use of information within the 

State relating to section 618(b)(1)(c) of the 

Individuals with Disabilities Education Act. 

(c) Quality, scope, and extent of services. 

Describe the quality, scope, and extent of 

supported employment services to be provided 

to individuals with the most severe disabilities 

under this program. The description must 

address the timing of the transition to extended 

services referred to in § 363.50(b)(2). 

(d) Distribution of funds. Describe the State’s 

goals and plans with respect to the distribution 

of funds received under § 363.20. 

(e) Collaboration. Demonstrate evidence of the 

efforts of the designated State unit to identify 

and make arrangements, including entering into 

cooperative agreements, with— 

(1) Other State agencies and other appropriate 

entities to assist in the provision of supported 

employment services; and 

(2) Other public or non-profit agencies or 

organizations within the State, employers, 

natural supports, and other entities with respect 

to the provision of extended services. 

(f) Minority outreach. Describe the designated 

State unit’s outreach procedures for identifying 

and serving individuals with the most severe 

disabilities who are minorities. 

(g) Assurances. Provide assurances that— 

(1) Funds made available under this part will 

only be used to provide supported employment 

services authorized under the Act to individuals 

who are eligible under this part to receive the 

services; 

(2) The comprehensive assessments of 

individuals with severe disabilities conducted 

under section 102(b)(1)(A) and funded under 

title I of the Act will include consideration of 

supported employment as an appropriate 

rehabilitation objective; 

(3) An individualized written rehabilitation 

program, as required by section 102 of the Act, 

will be developed and updated, using funds 

under title I, that— 

(i) Specifies the supported employment 

services to be provided to each individual served 

under this program, including a description of 

the expected extended services needed, which 

may include natural supports, and an 

identification of the State, Federal, or private 

programs or other resources that will provide the 

extended services, including a description of the 

basis for determining that extended services are 

available, or to the extent that it is not possible 

to identify the source of extended services at the 

time the individualized written rehabilitation 

program is developed, a statement describing 

the basis for concluding that there is a 

reasonable expectation that sources will become 

available; 

(ii) Provides for periodic monitoring to ensure 

that each individual with severe disabilities is 

making satisfactory progress toward meeting the 

weekly work requirement established in the 

individualized written rehabilitation program by 

the time of transition to extended services; 

(4) The State will use funds provided under 

this part only to supplement, and not supplant, 

the funds provided under title I of the Act, in 

providing supported employment services 

specified in the individualized written 

rehabilitation program; 

4 
(5) Services provided under an individualized 

written rehabilitation program will be coordinated 

with services provided under other individualized 

plans established under other Federal or State 

programs; 

(6) To the extent job skills training is provided, 

the training will be provided on-site; 

(7) Supported employment services will 

include placement in an integrated setting for the 

maximum number of hours possible based on 

the unique strengths, resources, interests, 

concerns, abilities, and capabilities of individuals 

with the most severe disabilities; 

(8) The designated State agency or agencies 

will expend no more than 5 percent of the 

State’s allotment under this part for 

administrative costs of carrying out this program; 

and 

(9) The public participation requirements of 

section 101(a)(23) are met. 

(h) Other information. Contain any other 

information and be submitted in the form and in 

accordance with the procedures that the 

Secretary may require. 

(Approved by the Office of Management and 

Budget under control number 1820–0500) 

(Authority: 29 U.S.C. 795n) 

Subpart C—How Does the 

Secretary Make a Grant? 

§ 363.20 How does the Secretary 

allocate funds? 

The Secretary allocates funds under this 

program in accordance with section 632(a) of 

the Act. 

(Authority: 29 U.S.C. 795k) 

§ 363.21 How does the Secretary 

reallocate funds? 

The Secretary reallocates funds in accordance 

with section 632(b) of the Act. 

(Authority: 29 U.S.C. 795k) 

Subparts D–E [Reserved]

Subpart F—What Post-Award 

Conditions Must Be Met by a 

State? 

§ 363.50 What collaborative 

agreements must the State develop? 

(a) A designated State unit must enter into one 

or more written cooperative agreements or 

memoranda of understanding with other 

appropriate State agencies, private nonprofit 

organizations, and other available funding 

sources to ensure collaboration in a plan to 

provide supported employment services and 

extended services to individuals with the most 

severe disabilities. 

(b) A cooperative agreement or memorandum 

of understanding must, at a minimum, specify 

the following: 

(1) The supported employment services to be 

provided by the designated State unit with funds 

received under this part. 

(2) The extended services to be provided by 

relevant State agencies, private nonprofit 

organizations, or other sources following the 

cessation of supported employment services 

under this part. 

(3) The estimated funds to be expended by the 

participating party or parties in implementing the 

agreement or memorandum. 

(4) The projected number of individuals with 

the most severe disabilities who will receive 

supported employment services and extended 

services under the agreement or memorandum. 

(Authority: 29 U.S.C. 795n) 

§ 363.51 What are the allowable 

administrative costs? 

(a) Administrative costs—general. 

Expenditures are allowable for the following 

administrative costs: 

(1) Administration of the State plan supplement 

for this program. 

(2) Planning program development, and 

personnel development to implement a system 

of supported employment services. 

(3) Monitoring, supervision, and evaluation of 

this program. 

(4) Technical assistance to other State 

agencies, private nonprofit organizations, and 

businesses and industries. 

(b) Limitation on administrative costs. Not 

more than five percent of a State’s allotment 

5 
6 

may be expended for administrative costs for 

carrying out this program. 

(Authority: 29 U.S.C. 795n) 

§ 363.52 What are the information 

collection and reporting 

requirements? 

(a) A State shall collect and report information 

as required under section 13 of the Act for each 

individual with the most severe disabilities 

served under this program. 

(b) The State shall collect and report 

separately information for 

(1) Supported employment clients served 

under this program; and 

(2) Supported employment clients served 

under 34 CFR part 361. 

(Approved by the Office of Management and 

Budget under control number 1820–0551) 

(Authority: 29 U.S.C. 712 and 795o) 

§ 363.53 What special conditions 

apply to services and activities under 

this program? 

Each grantee shall coordinate the services 

provided to an individual under this part and 

under 34 CFR part 361 to ensure that the 

services are complementary and not duplicative. 

(Authority: 29 U.S.C. 711(c) and 795p) 

§ 363.54 What requirements must a 

State meet before it provides for the 

transition of an individual to 

extended services? 

A designated State unit must provide for the 

transition of an individual with the most severe 

disabilities to extended services no later than 18 

months after placement in supported 

employment, unless a longer period is 

established in the individualized written 

rehabilitation program, and only if the individual 

has made substantial progress toward meeting 

the hours-per-week work goal provided for in the 

individualized written rehabilitation program, 

the individual is stabilized in the job, and 

extended services are available and can be 

provided without a hiatus in services. 

(Authority: 29 U.S.C. 795n and 711(c)) 

§ 363.55 What are the requirements 

for successfully rehabilitating an 

individual in supported employment? 

An individual with the most severe disabilities 

who is receiving supported employment services 

is considered to be successfully rehabilitated if 

the individual maintains a supported 

employment placement for 60 days after making 

the transition to extended services. 

(Authority: 29 U.S.C. 711(c)) 

§ 363.56 What notice requirements 

apply to this program? 

Each grantee must advise applicants for or 

recipients of services under this part, or as 

appropriate, the parents, family members, 

guardians, advocates, or authorized 

representatives of those individuals, of the 

availability and purposes of the State’s Client 

Assistance Program, including information on 

seeking assistance from that program. 

(Authority: 29 U.S.C. 718a)