[Federal Register Volume 71, Number 165 (Friday, August 25, 2006)]
[Proposed Rules]
[Pages 50760-50832]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 06-7067]



[[Page 50759]]

-----------------------------------------------------------------------

Part IV





Department of Labor





-----------------------------------------------------------------------



Employment and Training Administration



-----------------------------------------------------------------------



20 CFR Parts 617, 618, 665, and 671



Trade Adjustment Assistance for Workers, Workforce Investment Act; 
Amendment of Regulations; Proposed Rule

Federal Register / Vol. 71, No. 165 / Friday, August 25, 2006 / 
Proposed Rules

[[Page 50760]]


-----------------------------------------------------------------------

DEPARTMENT OF LABOR

Employment and Training Administration

20 CFR Parts 617, 618, 665, 671

RIN 1205-AB32


Trade Adjustment Assistance for Workers, Workforce Investment 
Act; Amendment of Regulations

AGENCY: Employment and Training Administration, Labor.

ACTION: Notice of Proposed Rule Making (NPRM).

-----------------------------------------------------------------------

SUMMARY: On August 6, 2002, President Bush signed into law the Trade 
Adjustment Assistance Reform Act of 2002 (the Reform Act), which 
amended the Trade Act of 1974, as amended (Act or Trade Act). The 
Reform Act reauthorized the Trade Adjustment Assistance (TAA) program 
through fiscal year 2007 and made significant amendments to the TAA 
program, which generally took effect on November 4, 2002. The 
Employment and Training Administration (ETA) of the United States 
Department of Labor (Department or DOL) is publishing this proposed 
rule to implement the amended TAA program.

DATES: The Department invites written comments on this proposal. 
Comments must be submitted by October 24, 2006.

ADDRESSES: You may submit written comments, identified by the proposed 
rule's Regulatory Identification Number (RIN) 1205-AB32, on the 
proposed rules by any of the following methods:
    <bullet> Federal eRulemaking Portal: http://www.regulations.gov. 
Follow the instructions for submitting comments.
    <bullet> E-mail: <a href="/cdn-cgi/l/email-protection#e4968183918885908d8b8a97cab0a5a5a4808b88ca838b92"><span class="__cf_email__" data-cfemail="b9cbdcdeccd5d8cdd0d6d7ca97edf8f8f9ddd6d597ded6cf">[email protected]</span></a>. Include RIN 1205-AB32 in 
the subject line of the message. Your comment must be in the body of 
the e-mail message; do not send attached files.
    <bullet> Fax: (202) 693-3584 (this is not a toll-free number). Only 
comments of ten or fewer pages (including a Fax cover sheet and 
attachments, if any) will be accepted by Fax.
    <bullet> Mail: Submit comments (preferably with three copies) to 
Erica Cantor, Director, Division of Trade Adjustment Assistance, ETA, 
U.S. Department of Labor, Room C-5311, 200 Constitution Avenue, NW., 
Washington, DC 20210. Because of security-related concerns, there may 
be a significant delay in the receipt of submissions by United States 
Mail. You must take this into consideration when preparing to meet the 
deadline for submitting comments.
    Instructions: All submissions received must include the agency name 
and the RIN for this rulemaking: RIN 1205-AB32. If commenters transmit 
comments by Fax or through the Internet and also submit a hard copy by 
mail, please indicate that it is a duplicate copy of the Fax or 
Internet transmission.
    All comments will be available for public inspection and copying 
during normal business hours at the Division of Trade Adjustment 
Assistance, ETA, U.S. Department of Labor, 200 Constitution Avenue, 
NW., Room C-5311, Washington, DC 20210. Copies of the proposed rule are 
available in alternative formats of large print and electronic file on 
computer disk, which may be obtained at the above-stated address. The 
proposed rule is available on the Internet at the Web address http://www.doleta.gov.

FOR FURTHER INFORMATION CONTACT: Erica Cantor, Director, Division of 
Trade Adjustment Assistance, ETA, U.S. Department of Labor, 200 
Constitution Avenue, NW., Room C-5311, Washington, DC 20210. Telephone: 
(202) 693-3560 (voice) (this is not a toll-free number); 1-800-326-2577 
(TDD); facsimile: (202) 693-3584; e-mail: <a href="/cdn-cgi/l/email-protection#83f1e6e4f6efe2f7eaecedf0add7c2c2c3e7ecefade4ecf5"><span class="__cf_email__" data-cfemail="77051210021b16031e181904592336363713181b59101801">[email protected]</span></a>.

SUPPLEMENTARY INFORMATION: The Reform Act expanded the scope of the TAA 
program and increased benefit amounts available under that program, 
repealed the North American Free Trade Agreement Transitional 
Adjustment Assistance (NAFTA-TAA) program, provided a health coverage 
tax credit (HCTC) administered by the Internal Revenue Service (IRS) to 
subsidize private health insurance costs for qualified workers, and 
enacted a pilot program for Alternative Trade Adjustment Assistance for 
older workers (ATAA). These amendments were designed to augment and 
improve the delivery of benefits and services to certain workers 
adversely affected by foreign trade.
    To incorporate into regulations the substantial changes to the TAA 
program, including the introduction of ATAA, the Department proposes 
creating a new 20 CFR Part 618. The proposed Part 618 consists of nine 
subparts: subpart A--General; subpart B--Petitions and Determinations 
of Eligibility to Apply for Trade Adjustment Assistance [Reserved]; 
subpart C--Delivery of Services through the One-Stop Delivery System; 
subpart D--Job Search Allowances; subpart E-Relocation Allowances; 
subpart F--Training Services; subpart G--Trade Readjustment Allowances 
(TRA); subpart H--Administration by Applicable State Agencies; and 
subpart I--Alternative Trade Adjustment Assistance for Older Workers 
[Reserved]. Because of the complexity of the subject matter and the 
States' need for definitive instructions on providing TAA benefits, the 
rulemaking for Part 618 is divided into three parts. This Notice of 
Proposed Rulemaking covers the general provisions (subpart A) and TAA 
benefits portions (subpart C through subpart H) of the regulations. 
Separate notices of proposed rulemaking (RIN 1205-AB40 covering subpart 
I and RIN 1205-AB44 covering Subpart B) will be published at a later 
date.
    Consistent with the Reform Act, the Department proposes that the 
TAA regulations codified at 20 CFR Part 617 be amended to apply only to 
adversely affected workers whose certifications of eligibility to apply 
for TAA are based on petitions filed before the effective date of the 
amendments, whether the certifications were issued before or after that 
date. However, eligible workers covered by Part 617 will be able to use 
the HCTC, and the Department proposes to amend Part 617 to require the 
States to advise adversely affected workers covered by that Part of the 
qualifying requirements for the HCTC and related health insurance 
assistance. The Department also proposes revising the regulations 
governing Statewide Workforce Investment Activities, and National 
Emergency Grants, 20 CFR Parts 665 and 671, respectively. These 
revisions will incorporate into the Workforce Investment Act of 1998 
(WIA) regulations the new statutory requirement that States provide 
rapid response assistance to workers as soon as they have filed 
petitions, or petitions have been filed on their behalf, for 
certification of eligibility to apply for TAA. A new section will be 
added to Part 671 to incorporate the new statutory authority for the 
use of funds made available under WIA to make grants to provide health 
insurance coverage assistance to certain adversely affected workers 
under the Trade Act and others.
    This preamble is divided into five sections. Section I provides 
general background information on the TAA program. Section II describes 
the changes that the Reform Act made to the TAA program. Section III 
discusses the Department's guiding principles for implementing reform 
of the TAA program through the proposed rule. Section IV discusses the 
proposed rule. Section V discusses administrative requirements for this 
proposed rulemaking, as mandated by statute and executive order.

[[Page 50761]]

I. Background

    The Reform Act amended chapter 2 of title II of the Trade Act of 
1974 (Pub. L. 93-618), as amended. The TAA program, established by the 
Act in 1974 to provide improved assistance for workers injured or 
threatened with injury from increased imports, was changed extensively 
by amendments in 1981 (title XXV of Pub. L. 97-35), 1984 (sections 2671 
and 2672 of Pub. L. 98-369), 1986 (Part 1 of subtitle A of title XIII 
of Pub. L. 99-272), 1988 (Part 3 of subtitle D of title I of Pub. L. 
100-418), and 1993 (section 506 of Pub. L. 103-182).
    Before the TAA program's most recent amendment in August 2002, the 
Department conducted a fact-finding investigation in response to its 
receipt of a petition for TAA from a group of workers (or their 
representative). If the investigation resulted in the finding that a 
group of workers of a firm (or subdivision) had been adversely affected 
by import competition, then an ETA certifying officer issued a 
certification stating that workers in the identified worker group were 
eligible to apply for TAA benefits with the Cooperating State Agency 
(CSA).
    Then, as now, State agencies administered the TAA program as agents 
of the federal government through agreements signed by the Secretary 
and Governors of the States. State agencies notified certified workers 
of potential TAA benefits and services, made eligibility determinations 
for individuals, and delivered benefits and services. Individual 
workers who were members of the certified worker group applied for 
benefits and services at a local office of the State's One-Stop 
delivery system.
    Individual workers who met the qualifying criteria could receive up 
to 104 weeks of job training, generally up to 52 weeks of income 
support in the form of Trade Readjustment Allowances (TRA), job search 
allowances, and relocation allowances. In addition, all workers covered 
by a certification were eligible for basic reemployment services, 
including assistance in writing resumes, job referrals, and 
participation in job clubs.
    On December 8, 1993, the President signed into law the NAFTA 
Implementation Act of 1993, which created the NAFTA-TAA program 
(section 250 of subchapter D of chapter 2 of title II of the 1974 Act). 
Certifications of worker groups under the NAFTA-TAA program were made 
only if imports from Canada and/or Mexico caused the import impact, or 
if the workers' firm shifted production of an article to either Canada 
or Mexico. Workers (or their representatives) filed petitions with the 
Governor of the State in which they were employed, not directly with 
the Department. The State performed a preliminary investigation upon 
receipt of a NAFTA-TAA petition. If the workers appeared to be impacted 
by imports from Canada or Mexico or a shift of production to Canada or 
Mexico and the firm's (or subdivision's) sales or production decreased 
absolutely, then the State undertook rapid response activities under 
WIA. The State transmitted all information gathered in its preliminary 
investigation to DOL, which issued the final determination on whether 
to certify the group of workers as eligible to apply for NAFTA-TAA 
benefits. In order to qualify for TRA, a worker certified under the 
NAFTA-TAA program had to be enrolled in approved training within 
specific time limits; no waivers from this requirement were allowed. 
However, the TAA program allowed waivers of ``basic'' TRA (i.e., the 
first 26 weeks of TRA) if training was ``not feasible or appropriate'' 
for the worker.
    As part of its passage of the NAFTA Implementation Act, Congress 
approved the Administration's Statement of Administrative Action (SAA). 
NAFTA, H.R. Doc. No. 103-159, vol. 1, at 10 (1993). The SAA committed 
the Department to provide assistance under the Job Training Partnership 
Act (and, after the repeal of that act, under WIA) to ``secondary'' 
workers who lost their jobs as a result of the loss of business with a 
primary firm that was directly affected by imports, but who were not 
directly impacted by trade with Canada or Mexico. See id. at 450 
(1993). Workers would receive assistance if their firm supplied 
components to, or performed finishing operations for, a firm that was 
directly impacted by trade with Canada or Mexico. These ``secondary 
workers'' either filed a petition for certification under both the TAA 
program and the NAFTA-TAA program or filed a petition just under the 
NAFTA-TAA program. The Department initiated an investigation into their 
eligibility under the SAA if their certification was denied following 
the investigation of a NAFTA-TAA petition. The Department determined 
whether the worker group was impacted indirectly or ``secondarily'' by 
imports from Canada and/or Mexico or a shift of production to Canada or 
Mexico. If the Department made an affirmative determination, then 
workers in the group were eligible to apply for benefits and services 
delivered through the dislocated worker program, even though they did 
not qualify for assistance under the NAFTA-TAA program.

II. How the Reform Act Changed the TAA Program

    The TAA program has been a required partner in the workforce 
investment system since the enactment of WIA in 1998. The Reform Act 
expressly directed the Secretary and the States to coordinate the TAA 
program with the workforce investment system created under WIA to help 
adversely affected workers return to the workforce as quickly as 
possible.
    The Reform Act expanded the coverage of the TAA program and 
increased the benefits provided to adversely affected workers, in part 
by consolidating the TAA program and the NAFTA-TAA program. As a 
result, there is a uniform set of requirements that replaces the often 
different and confusing sets of rules and procedures that applied to 
the two programs when they were separate. Before the enactment of the 
Reform Act, only workers whose firms (or subdivisions) were directly 
affected by increased imports could be certified as eligible to apply 
for TAA. Eligibility requirements for the NAFTA-TAA program were more 
inclusive. Workers whose firms (or subdivision) were directly affected 
by either increased imports from or a shift in production to Mexico or 
Canada of an article that is like or directly competitive with the 
article their firm (or subdivision) produced could be certified as 
eligible to apply for NAFTA-TAA benefits. The Reform Act expanded 
eligibility even further by retaining the TAA program's eligibility for 
workers who were directly affected by increased imports from any 
country and adding provisions to include workers who lose their jobs 
when their firms (or subdivisions) shifted production to: a country 
that is a party to a free trade agreement with the United States (such 
as, but not limited to, NAFTA); a country that is a beneficiary under 
certain specified legislation enacted by Congress involving trade 
relations; or to any other foreign country when there has been or there 
is likely to be an increase in imports of articles that are like or 
directly competitive with the articles produced by their firm (or 
subdivision).
    In addition, the Reform Act expanded TAA program eligibility to 
include two categories of secondary workers in the stream of commerce: 
those who perform work upstream in the production of a trade-impacted 
article and those who perform work downstream in that production. The 
first category covers workers who perform activities for a

[[Page 50762]]

firm (or subdivision of a firm) that supplies component parts for the 
article produced by a ``primary firm'' (i.e., a firm that employed a 
certified group of workers). The Act requires that, if a significant 
number or proportion of such secondary workers have been separated (or 
threatened with separation), then they will be certified as eligible to 
apply for TAA if either the component parts sold to the primary firm 
constituted at least 20 percent of the sales of the supplier, or the 
loss of business with the primary firm contributed importantly to the 
loss of jobs at the supplying firm.
    The second category of secondary workers includes workers employed 
by ``downstream producers,'' defined as firms (or subdivisions) 
providing additional, value-added production processes, such as 
finishers or final assemblers of articles produced by a primary firm. 
These workers will be certified as eligible to apply for TAA when: 
workers of the primary firm were TAA-certified due to increased imports 
from or shifts in production to Mexico or Canada of the articles that 
were the basis for the TAA certification; a significant number or 
proportion of the workers in the secondary workers' firm (or applicable 
subdivision) were separated or threatened with separation; and the 
secondary workers' firm's (or subdivision's) loss of business from the 
primary firm (or appropriate subdivision) contributed importantly to 
their separation (or threatened separation). Both the upstream 
``supplier'' and the ``downstream producer'' categories of secondary 
workers, although not covered by the NAFTA-TAA program, may have been 
eligible under the SAA to receive adjustment assistance initially 
through the Job Training Partnership Act and later through WIA.
    The Reform Act made a number of changes in administrative 
requirements under the TAA program. One-Stop operators, One-Stop 
partners, including certain State agencies as well as employers of 
workers, are specifically added to the categories of entities who may 
file a petition, though previously these entities could have filed 
petitions only if they were duly authorized representatives of a group 
of workers. To inform workers more quickly of the availability of 
assistance and to facilitate reemployment, rapid response assistance 
under WIA is now triggered by the concurrent submission of a petition 
to the Governor and the Secretary. The Department must now make a 
determination on whether a petition for certification meets the 
approval criteria within 40 days instead of 60 days from the date of 
filing of the petition.
    To promote adjustment and accelerate reemployment, the Reform Act 
provides that eligibility for TRA, which is additional income support 
after unemployment insurance (UI) is exhausted, will be contingent on a 
worker's enrollment in training not later than 16 weeks after 
separation from employment or 8 weeks after the petition for 
eligibility has been approved, whichever date is later. In extenuating 
circumstances, these deadlines for enrollment in training may be 
extended up to 45 days; and a waiver of the enrollment in training 
requirement to receive basic TRA may be issued only under limited and 
specified conditions. The Reform Act also increased the length of time 
that TRA is available to an adversely affected worker who is in 
training by increasing the availability of ``additional'' TRA from 26 
to 52 weeks and by further adding up to 26 additional weeks of TRA if a 
worker is enrolled in a course of remedial education. The primary 
purpose of this extended income support is to minimize workers' 
financial hardship until they complete training. By requiring that 
workers expeditiously enroll in training as a condition of receiving 
TRA, the Reform Act amendments provide that workers will be more likely 
to complete the training within the duration of that income support.
    The Reform Act also established ATAA, a pilot program designed to 
encourage the rapid reemployment of workers aged 50 or older. 
Petitioners seeking ATAA certification for a group of workers on whose 
behalf TAA certification is sought should make their request on the TAA 
petition form they submit to the Department. In determining whether to 
certify a group of workers as eligible to apply for ATAA, the following 
criteria must be considered: (1) Whether a significant number of 
workers in the workers' firm are 50 years of age or older; (2) whether 
the workers in the workers' firm possess skills that are not easily 
transferable; and (3) the competitive conditions within the workers' 
industry.
    A qualified worker in a group certified as eligible to apply for 
ATAA may choose to receive payments of 50 percent of the difference 
between their pre-layoff wages and their reemployment wages in lieu of 
all other benefits available under the TAA program except the HCTC. A 
worker may receive payments for up to a two-year period, but the 
maximum amount paid may not exceed $10,000. In order to qualify, a 
worker must be at least 50 years of age, become reemployed within 26 
weeks of separation, and be reemployed at annual wages of less than 
$50,000 in a full-time job that is not the job from which he or she was 
laid off. The termination date for ATAA is August 6, 2008, five years 
after the date of its implementation. However, participants may 
continue to receive the balance of the payments for which they were 
eligible after the termination date.
    The Reform Act amended the Internal Revenue Code (IRC) to authorize 
the HCTC for certain eligible individuals in the new and old TAA 
programs and in the NAFTA-TAA program. The Reform Act added a new 
section 35 to the IRC, establishing the HCTC which is a tax credit 
covering 65 percent of the cost paid by the individual for coverage of 
the individual and the individual's qualified family members under 
qualified health insurance. Potentially eligible individuals fall into 
three groups: (1) ``eligible TAA recipients,'' meaning individuals who 
are receiving TRA or who would be eligible to receive TRA if they had 
exhausted their UI; (2) ``eligible alternative TAA recipients,'' 
meaning individuals who are receiving a benefit under the ATAA program; 
and (3) ``eligible PBGC pension recipients,'' meaning individuals who 
are at least age 55 and receiving pension benefits paid, at least in 
part, by the Pension Benefit Guaranty Corporation (PBGC). The credit 
has been available on an advance basis since August 1, 2003. With 
respect to advance payments of the credit, the Reform Act requires the 
Secretary of Labor to certify an individual as an eligible TAA 
recipient, eligible ATAA recipient, or eligible PBGC pension recipient 
to enable potentially eligible recipients to seek the credit from the 
IRS. The IRS then determines whether the other HCTC eligibility 
criteria have been met. The Department is coordinating administration 
of this responsibility and other aspects of the HCTC with the 
Department of the Treasury, the Department of Health and Human 
Services, the PBGC, and the CSAs administering the TAA program.
    The Reform Act also added two new aspects to the National Emergency 
Grant (NEG) program administered by the DOL under WIA to assist the 
States in providing health insurance coverage assistance to eligible 
individuals. One type of NEG is available primarily to provide health 
insurance coverage assistance to eligible individuals and to pay the 
administrative and startup costs of enrolling such individuals, which 
includes the processing of the eligibility certificates necessary for 
the tax credit. The other type of NEG is available

[[Page 50763]]

primarily to provide interim health insurance coverage assistance and 
supportive services (such as transportation, child and dependent care, 
and income assistance) to individuals eligible for the tax credit, 
including eligible TAA recipients under the old TAA and NAFTA-TAA 
programs.
    The Reform Act also amended the Employee Retirement Income Security 
Act, the Public Health Service Act, and the IRC to allow a temporary 
60-day extension of the period during which individuals who are ``TAA-
eligible recipients'' may elect Consolidated Omnibus Budget 
Reconciliation Act (COBRA) continuation coverage under the layoff 
employer's health insurance plan. The temporary extension provided 
under the Reform Act begins on the day the individual first meets the 
TAA eligibility requirements. The TAA-eligible worker must elect to 
receive the temporary extension within six months after the date of the 
TAA-related loss of coverage, which the statute defines as the loss of 
health benefits coverage associated with the separation of the TAA-
eligible individual from employment. If a worker elects to receive the 
extension, then either the tax credit or the NEG would be available to 
assist the worker to make the payments for the continuation coverage.
    Aspects of the tax credit that are administered by the Internal 
Revenue Service and the Department of the Treasury are not addressed in 
the proposed regulations. However, the Department proposes amendments 
to WIA regulations at 20 CFR Part 671 to reflect the new tax credit-
related changes to the NEG programs. Funds made available to States 
under WIA section 174 will be used to provide health insurance coverage 
assistance to eligible TAA recipients, eligible ATAA recipients and 
eligible PBGC pension recipients under WIA section 173(f) and (g).
    The Reform Act also created a separate TAA for Farmers program. 
Eligibility determinations for that program are the responsibility of 
the Secretary of Agriculture. Agricultural commodity producers entitled 
to cash benefits under that program are entitled to the same basic 
reemployment services and training as other workers covered by the TAA 
program, but they may not receive TRA, job search or relocation 
allowances, or the HCTC. The Department of Labor provides funding for 
the employment services and the Secretary of Agriculture oversees the 
payment of cash assistance (up to $10,000 per year) provided to 
eligible agricultural commodity producers under the Department of 
Agriculture's certification. The Secretary of Agriculture issued 
regulations implementing the Department of Agriculture's function in 
the TAA for Farmers program on August 20, 2003 (68 FR 50048) and 
November 1, 2004 (69 FR 63317-01).

III. Guiding Principles for the TAA Program Under Proposed 20 CFR Part 
618

    The Secretary seeks to ensure that States use effective strategies 
to assist adversely affected workers in rapidly obtaining sustainable 
employment through the operation of the TAA program and the 
demonstration ATAA program for older workers. State agencies must 
increase their focus on early intervention, upfront assessment and 
reemployment services for adversely affected workers. The initiation of 
rapid response activities upon the filing of a petition for 
certification of eligibility to apply for TAA allows State agencies the 
opportunity to provide workers with early assessment and identification 
of their marketable skills. A CSA's first priority should be to provide 
job search assistance and other reemployment services to improve the 
likelihood of these workers obtaining sustainable employment quickly. 
Where training is appropriate, it should be designed to return the 
worker to employment as quickly as is consistent with the worker's 
training goals.
    Career centers in the One-Stop delivery system will become the main 
point of participant intake and delivery of benefits and services by 
the States. This approach encourages coordination among workforce 
investment and other One-Stop partner programs including the TAA 
program, which will better serve workers and promote efficiencies in 
the workforce investment system.
    Fiscal integrity and performance accountability will be monitored 
to ensure that the money allocated for TAA and ATAA is used to assist 
workers and thereby strengthen the economy. Improved participant 
outcome measures for the program will assist the Department and the 
States in reaching these goals.

IV. Summary and Discussion of Regulatory Provisions

    The rules proposed in this NPRM, covering TAA program benefits and 
administration, are based largely on the current regulations codified 
at 20 CFR Part 617 (Trade Adjustment Assistance for Workers under the 
Trade Act of 1974). The proposed Part 618 regulations also incorporate 
amendments to the TAA program effectuated by the Reform Act, and 
simplify the language adopted from the current regulations in 
compliance with the Presidential directive that Federal agencies write 
new regulations in plain language (63 FR 31885, June 10, 1998). In 
accordance with the Reform Act, the claims of workers covered by 
petitions filed before November 4, 2002 continue to be governed by the 
rules of the TAA and NAFTA-TAA programs prior to that date. These rules 
will continue to be codified at 20 CFR Part 617. In addition, the 
NAFTA-TAA operating instructions previously issued by DOL, General 
Administrative Letter No. 7-94 (59 FR 3871, January 27, 1994) and 
changes 1, 2, and 3 (69 FR 60898, October 13, 2004; 69 FR 67963-03, 
November 22, 2004) will continue to apply to eligible participants of 
the TAA and NAFTA-TAA programs until superseded by these regulations.
    The proposed amendments to 20 CFR Part 617 and to the WIA 
regulations, codified at 20 CFR Parts 665 and 671, respectively, 
reflect both the Reform Act requirements for coordination between the 
workforce investment system and the TAA program and changes to the NEG 
program relating to the HCTC.

Part 617--Trade Adjustment Assistance Under the Trade Act of 1974 for 
Workers Certified Under Petitions Filed Before November 4, 2002

    The proposed revisions to Part 617 include changing the title to 
clearly identify that this Part applies only to workers certified as 
eligible to apply for trade adjustment assistance under petitions filed 
before the Reform Act changed the TAA program. Proposed Sec.  617.1 
amends this section to provide further clarification that the 
provisions for TAA assistance under this Part 617 will continue to 
apply after the effective date of Part 618 only to adjustment 
assistance, TRA, and other allowances available to adversely affected 
workers covered by certifications issued under petitions filed with the 
Secretary before November 4, 2002, the effective date of the Reform Act 
amendments to the TAA programs. Proposed Sec.  617.10 adds a new 
paragraph (e) to that section to require CSAs to advise adversely 
affected workers subject to the requirements of the TAA program in 
effect before November 4, 2002 of the qualifying requirements for the 
health coverage tax credit (HCTC) and related health insurance 
assistance established by the Reform Act.

[[Page 50764]]

Part 618--Trade Adjustment Assistance Under the Trade Act of 1974 for 
Workers Certified Under Petitions Filed After November 3, 2002.

Subpart A--General
    Subpart A describes the TAA program and the contents of all the 
subparts. In addition, it defines all relevant terms used in other 
subparts. (Several definitions related to subpart B (Petitions and 
Determinations of Eligibility to Apply for Trade Adjustment Assistance) 
are held in reserve for publication with subpart B.) Several 
definitions have been modified and simplified to clarify their 
meanings, or eliminated in response to statutory changes in the TAA 
program. In addition, definitions of new terms have been added to 
describe the amended TAA programs, including the new ATAA program. Use 
of these definitions in the NPRM is intended to facilitate the 
integration of the TAA programs into the One-Stop system under the WIA 
and to describe and implement new concepts introduced into the TAA 
programs by the Reform Act, such as the HCTC. Major changes include:
    <bullet> The goal of the program has been defined as providing 
workers, so as quickly as possible, with assistance to return them to 
work that will use the highest skill levels and pay the highest wages 
given the workers' preexisting skill levels and education and the 
condition of the labor market.
    <bullet> The definition of adversely affected worker has been 
clarified to include the owner of a small business adversely affected 
by foreign trade.
    <bullet> A new definition of customized training has been added.
    <bullet> Definitions necessary for HCTC processing have been added.
    Proposed Sec.  618.100 describes the purpose of the program, which 
the Department, based on past experience, has modified to reflect 
achievable outcomes for a worker. Under the current statement of 
purpose at 20 CFR 617.2, the stated goal of the TAA program is to 
return workers to suitable employment as quickly as possible. In this 
context, ``suitable employment'' means that after the worker received 
services under the TAA program, the worker would be re-employed at 80 
percent of his or her former salary. While that goal has not changed, 
the Department has revised the wording of the goal to make it clear 
that finding ``suitable employment'' is a goal, not a requirement of 
the Act.
    Although the ``suitable employment'' standard is a worthy goal, and 
one that the Department intends to continue to pursue, it is merely a 
goal and not a program requirement. Unfortunately, there are situations 
in which workers may be unable to obtain ``suitable employment'' either 
in the local labor market or as a result of training. This may occur 
because the workers are experienced workers for whom few jobs at their 
former wages are available, because of a depressed local labor market 
in which there are few available jobs, or because the workers have 
substantial barriers to reemployment. These factors significantly 
constrain the training opportunities that are available for these 
workers, and therefore, their employment prospects as well. Yet 
providing training, especially in a stagnant labor market, may 
significantly increase a worker's chances for obtaining a decent job 
with career advancement prospects or of succeeding in the labor market.
    The Department's goal is to provide the best possible outcome for 
each worker participating in the program. Therefore, the Department is 
committed to providing training that will allow a worker to compete for 
the highest paying employment achievable given the worker's pre-
existing skills, abilities, and education, and the current job market. 
The proposed purpose section accurately reflects the Department's goal.
    Proposed Sec.  618.105 sets forth the effective dates for various 
aspects of the TAA program, the ATAA program, and HCTC, as provided by 
the Reform Act. Until these regulations at Part 618 take effect, 
Training and Employment Guidance Letter (TEGL) No. 11-02 and its 
changes will continue to govern determinations on certifications and 
benefits for workers covered under petitions filed after November 3, 
2002. Similarly, TEGL No. 2-03, and its changes, continue to govern 
determinations on ATAA certifications and benefits made before the 
effective date of this Part 618. Part 617 will continue to apply to the 
operational and benefit provisions of the TAA program for petitions 
filed before November 4, 2002 and certifications granted under those 
petitions. General Administrative Letter (GAL) No. 7-94 (59 FR 3871, 
January 27, 1994) and its changes (69 FR 60898-60903, October 13, 2004) 
continue to apply to NAFTA-TAA petitions filed before November 4, 2002, 
even when determinations on those petitions are issued after that date.
    The terms defined in proposed Sec.  618.110 apply to both the 
petition process and the benefit provisions of the TAA program. They 
derive from six basic sources: the Act prior to the Reform Act 
amendments, the Reform Act, 20 CFR Part 617, 29 CFR Part 90, the WIA 
and its implementing regulations at 29 CFR Part 652, et seq. Several 
definitions used in 20 CFR Part 617 and 29 CFR Part 90 have been 
modified and simplified to clarify their meanings, amended to reflect 
current TAA statutory language or eliminated in response to TAA 
statutory changes.
    The particular definitions are explained as they appear in this 
section, in alphabetical order, as follows.
    Act--The citation for the Trade Act in the proposed definition is 
updated from the citations in 29 CFR Part 90 and 20 CFR 617.3(a) to 
include all amendments to the Act through the date of publication of 
this notice.
    Additional compensation--This proposed term was included in the 
description of unemployment compensation in 20 CFR 617.3(oo). The 
proposed definition of this term is the same as Sec.  617.3(oo)(2).
    Adversely affected employment--This proposed definition is based on 
the statutory definition, which was codified in 20 CFR 617.3(a), and, 
although the definition has been revised for clarity, no substantive 
change from that definition is intended.
    Adversely affected worker--This proposed definition modifies the 
definition in 20 CFR 617.3(c) to clarify the Department's 
interpretation of this statutory term. Under this proposed definition, 
an employer may be considered an adversely affected worker when the 
employer is also an employee of a business that closes or experiences a 
reduction in operation. In this circumstance, if the employer becomes 
totally or partially separated from his or her employment, the employer 
is an ``adversely affected worker.'' The proposed definition also 
changes the definition in 20 CFR 617.3(c) to include the applicable 
periods during which the worker's separation must occur in order for 
that worker to be eligible to apply for TAA, or TAA and ATAA: the 
period from the impact date to two years after the date on which the 
certification is signed or earlier if the certification is terminated 
before it expires after two years.
    Agent State--This proposed definition is substantively unchanged 
from the definition and description of agent State codified in 20 CFR 
617.3(aa)(2) and 617.16(e).
    Alternative Trade Adjustment Assistance, Alternative TAA or ATAA--
This proposed term refers to the assistance provided under the 
demonstration program introduced by the Reform Act to provide an 
alternate path for adversely affected workers over the age of 50 years 
to elect to receive benefits under the Act, as discussed in

[[Page 50765]]

subpart I (reserved for publication at a later date).
    Applicable State law--This proposed definition is substantially the 
same as in 20 CFR 617.16. The wording has been changed slightly to make 
the definition more easily understood, and the separate paragraph 
addressing adversely affected workers entitled to UI under the Railroad 
Unemployment Insurance Act (RRUI) has been dropped because it is 
duplicative of paragraph (a)(2) of this definition in 20 CFR 617.16, 
which also applies to adversely affected workers entitled to UI under 
the RRUI.
    Average weekly hours--This proposed definition is the same as in 20 
CFR 617.3(e).
    Average weekly wage--This proposed definition is substantively the 
same as in 20 CFR 617.3(f). However, it replaces the phrase ``the 
individual's appropriate week'' with the phrase ``the week in which the 
individual's first separation occurred.'' This change eliminates the 
definition of ``appropriate week,'' which was referenced only one time 
in the definition of ``average weekly wage'' at 20 CFR 617.3(f). 
Therefore, the Department proposes to remove the term ``appropriate 
week,'' as defined at 20 CFR 617.3(d), from this proposed Part 618. 
This definition otherwise did not change substantively.
    Benefit period--This proposed definition is the same as in 20 CFR 
617.3(h).
    Bona fide application for training--This proposed definition is the 
same as the definition in 20 CFR 617.3(i), except that it no longer 
includes the direction to the CSA that the form must be signed and 
dated upon receipt and the form used is not required to contain the 
local office number of the CSA. Instead, proposed Sec.  618.605(b)(2) 
directs a representative of the CSA to sign and date the application 
upon receipt. Access to CSAs and their contact information via 
telephone directories and information assistance and the Internet 
obviates the need for a bona fide application for training to contain 
the local office telephone number, which may soon be outdated.
    Certification--This proposed definition modifies the definition in 
Sec.  617.3(j)(1) to include a reference to ATAA. The procedures for 
obtaining a certification will be described in the proposed subpart B 
[reserved].
    Certification period--This proposed definition is the same as in 20 
CFR 617.3(j)(2).
    Certifying officer--This proposed definition is updated from the 
definition in 20 CFR Part 617 by changing ``Office'' to ``Division'' 
and ``Part 90'' to ``Part 618.''
    Co-enrollment--This proposed term refers to an individual who is 
participating in a TAA program and is also enrolled in another program 
administered through a State's WIA One-Stop delivery system.
    Commuting area--This proposed definition is the same as in 20 CFR 
617.3(k).
    Confidential business information--This proposed definition 
replaces the definition at 29 CFR 90.33(a), and provides a more precise 
statutory basis, under the Trade Secrets Act, 18 U.S.C. 1905, for 
withholding from disclosure commercial and financial data received by 
the Department during its investigation of petitions for certification 
of worker eligibility to apply for TAA, or TAA and ATAA. Section 
90.33(a) identifies the Freedom of Information Act, 5 U.S.C. 552 
(FOIA), and the Department's regulations implementing FOIA, 29 CFR Part 
70, as the bases for designating confidential commercial information as 
``privileged or confidential.'' FOIA exemption (b)(4) exempts from 
mandatory disclosure under FOIA certain commercial or financial 
information that is the subject of a FOIA request. The Trade Secrets 
Act affirmatively prohibits the disclosure of confidential business or 
commercial information, in the absence of legal authority. The term 
``confidential business information'' is used in connection with 
disclosure of information by the Department and by the States, as in 
proposed Sec.  618.865(b).
    Cooperating State agency or CSA--This proposed term is added to 
accurately identify the agency or agencies at the State level that 
carry out provisions of the Act because of the new emphasis on 
coordination between the TAA programs and the One-Stop delivery system. 
While the proposed definition includes the ``State agency,'' as that 
term was defined in 20 CFR 617.3(ii), it also includes the State 
Workforce Agency and other State or local agencies that cooperate in 
the administration of the TAA programs under an agreement between the 
Governor and the Secretary.
    Customized training--This proposed term is newly defined to 
identify a type of training previously not referenced in the Act. While 
the Reform Act generally did not amend the job retraining provisions of 
the Act, it changed the reference to ``on-the-job training'' to 
``employer-based training, including (i) on-the-job training and (ii) 
customized training.'' The proposed definition of customized training 
refers to Sec.  618.635(b) which describes customized training 
similarly to the definition for such training under WIA.
    Date of certification--This proposed term means the same as the 
term ``date of issuance'' in 29 CFR 90.2, but has been expanded and 
renamed to avoid any suggestion that the date on which the 
certification is signed may be different from the date on which the 
certification is issued. The phrase ``for a group of adversely affected 
workers at a firm or subdivision'' is added to the proposed definition 
to indicate that the certification will identify the group of workers 
to whom it applies.
    Date of filing--This proposed definition is modified from the 
definition in 29 CFR 90.2. The current office handling petitions under 
the TAA programs, DTAA, is substituted. The definition also makes clear 
that a petition is only considered filed on the date on which DTAA 
receives a complete petition.
    Date of separation--This proposed definition is intended to have 
the same meaning as 20 CFR 617.3(l), but is rephrased slightly for 
clarity and is stated in the disjunctive to make it clear that the 
three situations listed are alternatives.
    Department of Labor or Department or DOL--This proposed term 
identifies the Department of Labor. The abbreviations are added to 
simplify references to the agency.
    Director--This proposed definition differs from the definition in 
29 CFR 90.2 by using the term Division rather than Office to reflect 
the current ETA organizational structure, and by including any person 
who is designated to act in the place of the Director.
    Division of Trade Adjustment Assistance or DTAA--This proposed 
definition refers to the name of the organization within the Employment 
Training Administration of the Department with responsibility for 
administering the TAA programs. CSAs work under the direction of DTAA 
to provide services and benefits under the TAA programs.
    Eligible ATAA recipient, Eligible PBGC pension recipient and 
Eligible TAA recipient--These proposed definitions incorporate the 
definitions the categories of persons who may be eligible to qualify 
for the health coverage tax credit under section 35 of the Internal 
Revenue Code and health insurance coverage assistance under section 
173(g) of the WIA, 29 U.S.C. 2918, as amended by the Reform Act. These 
categories are defined in sections 35(c)(3), 35(c)(4) and 35(c)(2) of 
the Internal Revenue Code, 26 U.S.C. 35(c)(3), (c)(4) and (c)(2). The 
CSA must send a list of eligible ATAA and TAA recipients to the 
Internal Revenue Service (IRS). However, only the IRS

[[Page 50766]]

can make a determination that an individual who is on that list is 
eligible to receive the HCTC.
    Employer--This proposed definition is the same as in 20 CFR 
617.3(n).
    Employment--This proposed definition is the same as in 20 CFR 
617.3(o).
    Extended compensation or Extended Benefits or EB--This proposed 
term was included in the description of unemployment compensation in 20 
CFR 617.3(oo). The proposed definition of this term has been revised to 
simplify and update Sec.  617.3(oo)(3).
    Family--This proposed definition is the same as the definition of 
this term in 20 CFR 617.3(q), which is based on the Internal Revenue 
Code definition, except for updating the date of the Internal Revenue 
Code from ``1954'' to ``1986.''
    Federal student financial assistance--This proposed term is added 
to describe the various types of student financial assistance 
authorized by title IV of the Higher Education Act of 1965, as amended 
(20 U.S.C. 1070 et seq.) and Bureau of Indian Affairs student 
assistance programs which may be available to adversely affected 
workers.
    Federal supplemental compensation--This proposed term was included 
in the description of unemployment compensation in 20 CFR 617.3(oo). 
The proposed definition of this term has been revised to simplify and 
update the language used in Sec.  617.3(oo)(4).
    Firm--This proposed definition is substantially the same as in 29 
CFR 90.2. The definition is intended to be broad enough to encompass 
all kinds of organizations and to include closely related or affiliated 
organizations. The definition is, however, limited by basic rules of 
corporate and organizational law to entities that share the indicia of 
common ownership or control.
    First benefit period--This proposed definition is substantively the 
same as in 20 CFR 617.3(r). To achieve consistency in proposed Part 
618, the term ``worker'' is used instead of ``individual,'' which is 
used in this definition in Part 617.
    First qualifying separation--This proposed definition is 
substantially changed from 20 CFR 617.3(t)(3), which defines this term 
one way for purposes of determining the weekly and maximum amounts of 
basic TRA, and another way for all the other purposes of Part 617. For 
simplification, the proposed definition of this term applies solely for 
the purpose of determining the weekly and maximum amounts of basic TRA 
and is substantively the same as at 20 CFR 617.3(t)(3)(ii). The other 
purpose for which this term is used in 20 CFR 617.3(t)(3)(i) is now 
covered in the proposed definition of ``qualifying separation'' at 
proposed Sec.  618.110.
    First separation--This proposed definition is the same as in 20 CFR 
617.3(t)(1), except that the cross reference has been deleted as 
unnecessary.
    Health Coverage Tax Credit or HCTC--This proposed term is added to 
describe the tax benefit under section 35 of the Internal Revenue Code 
of 1986 (26 U.S.C. 35) that the Reform Act makes available to qualified 
TAA and ATAA recipients.
    Impact date--This proposed definition slightly revises the 
definition of this term at 20 CFR 617.3(v) for simplicity. The impact 
date is stated in the certification for eligibility of covered workers 
to apply for TAA. As required by section 223(b)(1) of the Act, the 
impact date may not be more than one year before the date of the 
petition on which such certification was granted.
    Individual employment plan (IEP)--This is a new definition. 
Generally, an IEP is prepared after conducting a comprehensive 
assessment of the worker's employment goals and strategies to achieve 
those goals. An IEP means an ongoing strategy jointly developed by the 
participant and the case manager that identifies the participant's 
employment goals, the appropriate achievement objectives, and the 
appropriate combination of services for the participant to achieve the 
employment goals.
    Job finding club--This proposed definition is the same as the 
definition of this term in 20 CFR 617.3(y).
    Job search program or JSP--This proposed definition is the same as 
the definition of this term in 20 CFR 617.3(w).
    Job search workshop--The proposed wording of this term varies 
slightly from 20 CFR 617.3(x) to provide a clearer description, but the 
meaning is intended to be the same.
    Lack of work--This term is used in the definitions of ``adversely 
affected worker'' in section 247(2) of the Act, as well as in the 
definitions of ``adversely affected worker'' and ``layoff'' in these 
proposed regulations. Thus, the term is defined here to clarify its 
meaning. The definition includes situations where the employer is 
downsizing the workforce by attrition or offering severance benefits to 
encourage workers to leave the workforce voluntarily, and where a 
worker's hours of employment have been reduced because sufficient work 
to maintain that worker's customary hours of work is not available. A 
worker who is separated from employment under these circumstances may 
be covered as an ``adversely affected worker'' and be eligible to 
receive TAA, or TAA and ATAA. It should be noted that some workers will 
meet this definition of a ``lack of work'' separation, but will be 
disqualified for UI under State voluntary quit provisions. The UI 
disqualification will make these workers ineligible for TRA, although 
they may qualify for other forms of TAA.
    Layoff--This proposed definition follows the definition in 20 CFR 
617.3(z) and contains two minor changes to the definition of this same 
term in 29 CFR 90.2. The phrase ``suspension or separation from 
employment'' used in Sec.  617.3(z) is adopted instead of the phrase 
``suspension from pay status'' used in the definition of this term in 
Sec.  90.2 because the Department intends for ``layoff'' to include 
persons separated from employment who receive severance pay and 
therefore may be considered to be in a pay status. This definition may 
be an issue for some States, and some workers will be able to get TAA 
services other than TRA, for which they may be disqualified based upon 
the receipt of severance pay. The Department proposes using the phrase 
``expected to be for a definite or indefinite period of not less than 
seven (7) consecutive days'' from 20 CFR 617.3(z) rather than the 
phrase ``expected to last for no less than seven (7) consecutive 
calendar days,'' which is used in the definition of this term in 29 CFR 
90.2. Use of the Part 617 language will remove any ambiguity about 
whether a suspension or separation from employment may be for a 
definite or indefinite period and still be a ``layoff'' for TAA 
purposes. Additionally, use of the Part 617 language will notify CSAs 
that they must continue to measure the duration of a suspension or 
separation from employment as they have been under Part 617.
    Liable State--This proposed definition follows 20 CFR 617.3(aa) but 
is revised for simplicity. The term ``Agent State'' is now separately 
defined at proposed Sec.  618.110.
    One-Stop delivery system--This proposed term refers to the system 
of entities within a State operating under WIA and its implementing 
regulations to provide employment and training activities, including 
coordination of services to eligible dislocated workers as defined 
under section 101(9) of WIA. WIA section 121(b)(1)(B)(viii) requires 
the TAA program to be a partner in the One-Stop delivery system.
    On-the-job training (OJT)--This proposed definition, unlike the

[[Page 50767]]

definition in 20 CFR 617.3(bb), defines this term by reference to the 
on-the-job training provision at proposed Sec.  618.635(a)(1) 
(enrollment in on-the-job and customized training).
    Partial separation--This proposed definition combines the slightly 
different definitions of this term in 20 CFR 617.3(cc) and 29 CFR 90.2. 
The definition of this term in Sec.  90.2 applies to separations ``at 
the firm or appropriate subdivision thereof,'' referring to workers who 
have not yet been certified as eligible to apply for TAA. After they 
have been determined to be eligible to apply for TAA, the workers' 
``partial separation'' is referred to in Sec.  617.3(cc) as being ``in 
adversely affected employment,'' the term that the Trade Act uses in 
section 247(6) of the Act to describe the two measures of ``partial 
separation.'' The proposed combined definition retains the statutory 
criteria of ``partial separation'' to refer to both workers on whose 
behalf a petition has been filed and workers who are covered by a 
certification. The proposed definition also clarifies the meaning of 
the term by specifying that, in order for the worker to be counted as 
partially separated from adversely affected employment, the reduction 
of hours must have occurred during a week ending on or after the impact 
date specified in a certification.
    Program of remedial education--This new proposed term is used to 
refer, as the Reform Act does, to education designed to upgrade the 
basic knowledge of adversely affected workers through such courses as 
adult basic education, basic math and literacy, English-as-a-second-
language, and high school equivalency.
    Qualifying separation--This term, as defined at 20 CFR 617.3(t)(2), 
is used to determine whether an individual qualifies as an adversely 
affected worker and for basic TRA. Under the proposed definition of 
this term, it applies for both those purposes as well as for 
determining the 16-week period for enrollment in approved training and 
the basic TRA eligibility period.
    For the purpose of determining the basic TRA eligibility period 
under proposed Sec.  618.745(a), an adversely affected worker's 
eligibility for basic TRA ends at ``the close of the 104-week [or, 
under the Reform Act amendments, if necessary to complete an approved 
training program that includes remedial education, the 130-week] period 
beginning with the first week following the week in which the adversely 
affected worker's most recent qualifying separation (defined in 
proposed Sec.  618.110) occurred.'' Thus, every time an adversely 
affected worker has a ``qualifying separation,'' he or she begins a new 
basic TRA eligibility period, as provided in section 233(a)(2) of the 
Act.
    This ``movable basic TRA eligibility period'' is the same under 
proposed Part 618 as it is under Part 617 because the Reform Act did 
not amend it. However, the Part 618 regulations achieve the same result 
in a simpler fashion. Section 617.15(a) of 20 CFR provided a 104-week 
``eligibility period.'' This term is defined at 20 CFR 617.3(m)(1)(ii) 
in reference to the ``first total qualifying separation,'' which is a 
``first qualifying separation'' under 20 CFR 617.3(t)(3)(i)(B). 
However, the definition of ``eligibility period'' in Part 617 provides 
that if an individual has a ``subsequent total qualifying separation 
within the certification period of the same certification,'' that 
individual would have a new 104-week eligibility period. Thus, the Part 
617 regulations provide for a movable basic TRA eligibility period, 
through several steps by running the eligibility period from the 
``first total qualifying separation,'' and then restarting it where the 
adversely affected worker had a ``subsequent total qualifying 
separation.'' The Part 618 regulations achieve the same result, but 
more simply, by running the eligibility period from the most recent 
``qualifying separation'' (defined as, among other things, a total 
separation).
    The definition of ``qualifying separation'' is used also for the 
purpose of determining the 16-week period for enrollment in approved 
training as a condition of TRA, a deadline added by the Reform Act. 
Proposed Sec.  618.720(b)(2) establishes this deadline as the ``last 
day of the 16th week after the adversely affected worker's most recent 
qualifying separation as defined in Sec.  618.110,'' thus establishing 
a ``movable'' 16-week period for enrollment in approved training, as 
provided in section 231(a)(5)(A)(ii)(I) of the Act.
    As noted in the preamble explanation of the definition of ``first 
qualifying separation'' at proposed Sec.  618.110, that definition 
applies only for the purposes of determining the weekly and maximum 
amount of basic TRA. The proposed definition of ``qualifying 
separation'' also modifies the 20 CFR 617.3(t)(2) definition by 
eliminating outdated provisions.
    Regional Administrator--This proposed definition is substantively 
unchanged from 20 CFR 617.3(dd).
    Regular compensation--This proposed term was included in the 
description of unemployment compensation in 20 CFR 617.3(oo). The 
proposed definition of this term is the same as Sec.  617.3(oo)(1).
    Secretary--This proposed term, used to refer to the Secretary of 
Labor, United States Department of Labor, is the same as in 20 CFR 
617.3(ff).
    State--This proposed definition is the same as the definition of 
this term in 20 CFR 617.3(hh).
    State agency--This proposed definition revises the definition of 
this term used in Part 617 by incorporating the statutory definition of 
``the agency of the State which administers the State law.'' The 
proposed definition of ``CSA'' in proposed Sec.  618.110 is the same as 
the 20 CFR 617.3(ii) definition of ``State agency,'' except that 
current terminology is used instead of ``State Employment Security 
Agency.''
    State law--This proposed definition is the same as in 20 CFR 
617.3(jj), except that the reference to the Internal Revenue Code has 
been updated.
    Suitable employment--The proposed definition of ``suitable 
employment'' comes from section 236(e) of the Act, defining it as 
``work of a substantially equal or higher skill level than the worker's 
past adversely affected employment, and wages for such work at not less 
than 80 percent of the worker's average weekly wage.'' That section 
expressly states that its definition of this term applies for purposes 
of section 236. Section 236 uses the term ``suitable employment'' only 
in section (a)(1)(A) (the first criterion for the approval of 
training), providing for approval where ``there is no suitable 
employment * * * available for an adversely affected worker.''
    The term ``suitable employment'' also is used in section 
231(c)(1)(B) of the Act to permit waiver of the training requirement 
for receiving TRA where an adversely affected worker has marketable 
skills for ``suitable employment'' and there is a reasonable 
expectation of employment at equivalent wages in the foreseeable 
future. Section 231 of the Act neither incorporates the definition of 
``suitable employment'' in section 236(e) of the Act nor provides a 
different definition of the same term. The Department has determined 
that it is appropriate to apply the section 236(e) definition of the 
term in implementing section 231 of the Act because these provisions 
are interrelated. Where ``suitable employment'' is available for an 
adversely affected worker, approval of training will be denied under 
section 236(a)(1)(A) of the Act. However, the worker may need income 
support while looking for that ``suitable employment,'' which may 
depend upon a waiver of the training requirement. Using the same

[[Page 50768]]

definition of ``suitable employment'' for purposes of section 
231(c)(1)(B) of the Act allows CSAs to decide whether to deny training 
and to grant waivers on the same basis.
    Sections 237(a)(2)(B) and 238(a)(2)(B) of the Act require, as 
conditions for receipt of job search and relocation allowances, that 
``the worker cannot reasonably be expected to secure suitable 
employment in the commuting area in which the worker resides.'' In 
implementing these provisions, the Department proposes in subparts D 
and E to use the same definition of the term ``suitable employment.'' 
This is a departure from the current regulations at 20 CFR 617.32(a)(4) 
(on job search allowances) and 617.42(a)(6) (on relocation allowances) 
which interpret ``suitable employment'' to mean ``suitable work'' as 
defined in 20 CFR 617.3(kk)(1) and (2), whichever is applicable to the 
individual. ``Suitable employment'' is generally work at higher skill 
levels and wage rates than is ``suitable work.'' By changing the 
interpretation of ``suitable employment'' to have the same meaning for 
purposes of eligibility for relocation and job search allowances that 
it has in proposed subpart F of Part 618 on training, the Department 
intends to encourage workers to use these benefits in a manner 
consistent with the purpose of the program to encourage workers to seek 
new jobs with compensation levels near the levels of those jobs from 
which they were separated. This proposed regulatory change may increase 
the number of workers who qualify for job search allowances in areas 
where ``suitable employment'' opportunities are limited. On the other 
hand, using ``suitable employment'' in the eligibility criteria for 
relocation allowances could restrict the jobs for which relocation 
allowances may be paid.
    The Department invites comment on whether it should instead define 
``suitable employment'' for purposes of job search and relocation 
allowance eligibility as a job at lower wages than ``suitable 
employment'' as defined in section 236(e) of the Act for job training 
approval. A lower standard for ``suitable employment'' would have the 
beneficial effect of increasing the number of jobs for which a worker 
might obtain a job search or relocation allowance. On the other hand, 
approval for either of these allowances requires that there be no 
reasonable expectation of securing ``suitable employment'' in the 
commuting area. Therefore, a lower standard would make it more likely 
that a disqualifying ``suitable employment'' would be available 
locally. The Department also invites comment on what level would be 
appropriate, and why.
    The proposed definition of ``suitable employment'' differs slightly 
from the definition in 20 CFR 617.22(a)(1)(i) by expressly requiring 
the CSA to take into consideration the value of fringe benefits, 
including health insurance, in determining whether the level of wages 
for work is at least 80 percent of the adversely affected worker's 
average weekly wage in the adverse employment from which the worker was 
separated. The broad definition of the term ``wages'' in 20 CFR 
617.3(pp) and proposed paragraph 618.110, which includes ``all 
compensation for employment for an employer, including commissions, 
bonuses, and the cash value of all compensation in a medium other than 
cash,'' is the basis for emphasizing to the CSAs that they must 
consider fringe benefits as part of the total wage package factor in 
making determinations as to whether ``suitable employment'' is 
available to an adversely affected worker. Comments on this change in 
definition are specifically requested.
    Suitable work--The definition proposed for Part 618 is the same as 
the definition of this term in 20 CFR 617.3(kk)(1) and (2), that is, 
either as suitable work as defined in the applicable State law for 
claimants for regular compensation, or suitable work as defined in 
applicable State law provisions consistent with section 202(a)(3) of 
the Federal-State Extended Unemployment Compensation Act (EUCA) of 
1970. State unemployment insurance laws define ``suitable work'' in 
terms of a worker's job prospects. The better the job prospects, the 
higher the level of work considered suitable. Further, where a worker's 
job prospects are not good, the EUCA considers any work within the 
worker's capabilities to be suitable. Lastly, the proposed definition, 
as well as the Part 617 definition, excludes self-employment or 
employment as an independent contractor. Thus, if self-employment or 
employment as an independent contractor is the only available 
employment in the worker's commuting area, the worker may be eligible 
for a job search or relocation allowance as he or she will not be 
disqualified for this reason.
    Supportive services--This proposed new term is used to refer to 
such services as transportation, childcare, dependent care, and housing 
that are needed to enable an individual to participate in activities 
authorized under the Act.
    Total separation--This proposed definition combines the definitions 
currently codified in 20 CFR 617.3(ll) and 29 CFR 90.2. The definition 
of ``total separation'' in 29 CFR Part 90 refers to an individual's 
layoff or severance ``from a firm or an appropriate subdivision 
thereof;'' the 20 CFR Part 617 definition refers to an individual's 
layoff or severance from ``employment with a firm in which, or in a 
subdivision of which, adversely affected employment exists,'' and 
therefore refers to a determination that the individual is covered by a 
certification of eligibility to apply for TAA. The proposed definition 
recognizes that a ``total separation'' is the same whether or not the 
worker group involved is covered by a certification.
    Trade adjustment assistance or TAA--The proposed definition of TAA 
has been revised to refer to the services and allowances to help 
adversely affected workers become reemployed. They include TRA, 
training and other reemployment services, job search allowances and 
relocation allowances, and HCTC.
    Trade adjustment assistance for Farmers program or TAA for Farmers 
program--This term is added to refer to the program of adjustment 
assistance added to the Act by subtitle C of the Reform Act to provide 
benefits and services to agricultural commodity producers through a 
certification process administered by the United States Department of 
Agriculture under regulations codified at Part 1580 of title 7 of the 
Code of Federal Regulations. Employment services and training under the 
TAA program are available to agricultural commodity producers 
determined by the Department of Agriculture to be eligible to receive a 
cash benefit under that program.
    Trade readjustment allowance or TRA--This proposed definition is 
substantively unchanged from 20 CFR 617.3(nn).
    Unemployment insurance or UI--This proposed definition has been 
revised to simplify, update and clarify the language in 20 CFR 
617.3(oo). The four types of UI defined in 20 CFR 617.3(oo) (regular 
compensation, additional compensation, extended compensation or 
extended benefits or EB, and Federal supplemental compensation) are 
separately defined in this section.
    Wages--This proposed definition is the same as the definition of 
this term in 20 CFR 617.3(pp).
    Wagner-Peyser Act--This new proposed term refers to the Wagner-
Peyser Act, as amended (29 U.S.C. 49 et seq.).

[[Page 50769]]

    Week--This proposed definition is the same as the definition of 
this term in 20 CFR 617.3(qq).
    Week of unemployment--The proposed definition follows the 
definition of this term in the Act, and differs from the definition but 
not the meaning of this term in 20 CFR 617.3(rr) by using the phrase 
``Federal unemployment insurance law'' instead of ``Federal 
unemployment compensation law'' to accord with the proposed definition 
of UI in paragraph (b)(80) of Sec.  618.110.
    Workforce Investment Act or WIA--This proposed term refers to the 
Workforce Investment Act of 1998, under which the Department provides 
States and local Workforce Investment Areas with funds for employment 
and training activities for adults and dislocated workers and for youth 
activities.
Subpart C--Delivery of Services Through the One-Stop Delivery System
    Proposed subpart C is an entirely new subpart that sets forth 
requirements for CSAs to assist individuals who are covered by a 
petition but not yet certified, as well as adversely affected workers. 
This subpart provides a road map for CSAs of their responsibility for 
providing reemployment services, whether they are provided through the 
TAA program, through the WIA One-Stop delivery system, or through any 
other federal law. It covers rapid response assistance and access to 
WIA core and intensive services, as well as supportive and other 
services. It emphasizes the integration of the TAA program into the WIA 
One-Stop delivery system. Subpart C is added in response to amendments 
made by the Reform Act, so it does not have an exact counterpart in 
Part 617 of the DOL regulations. Major points include:
    <bullet> CSAs must ensure that their TAA program administration 
complies with the One-Stop partnership requirements.
    <bullet> Individuals covered by a petition must be offered rapid 
response assistance and WIA core and intensive services.
    <bullet> A needs assessment is required for each TAA applicant and 
a comprehensive assessment for any recipient entering training.
    <bullet> CSAs must make every reasonable effort to secure for 
adversely affected workers counseling, testing, and placement services 
as well as supportive and other services provided for under any other 
Federal law.
    <bullet> Co-enrollment is encouraged as a strategy for delivering 
services.
    <bullet> CSAs are required to prepare an individual employment plan 
(IEP).
    <bullet> Worker benefit eligibility is protected by requiring CSAs 
to take timely action on training waivers when appropriate.
    <bullet> CSAs are required to provide employment services to 
individuals entitled to cash benefits under the TAA for Farmers program 
administered by the U.S. Department of Agriculture.
    Proposed Sec.  618.300 discusses the scope of this new subpart, 
which focuses on the requirement that TAA program benefits and services 
be integrated to the extent possible with the reemployment services 
provided through the WIA-funded One-Stop delivery system. Consistent 
with the Reform Act, Subpart C is intended to provide individuals with 
a seamless delivery of services necessary for each to return to 
employment as quickly as possible by requiring and promoting the 
integration activities and services described below.
    The Act requires cooperating State agencies to provide reemployment 
services to two classes of participants: (1) Individuals covered by a 
petition for TAA filed by, or on behalf of, a group of workers and, (2) 
adversely affected workers who are covered by a petition that has 
already been certified. Under section 221(a)(2)(A) of the Act, the 
Governor must offer individuals covered by a petition rapid response 
assistance and WIA core and intensive services. Adversely affected 
workers must be offered core and intensive services, including 
counseling, testing and placement services and supportive and other 
services provided for under any other Federal law, including the 
Wagner-Peyser Act and the WIA. This requirement is based on new 
language in section 235, 239(a), (e) and (g) of the Act and the 
Congressional Declaration of Policy in section 125(a) of the Reform 
Act. These services must be coordinated with workforce activities and 
services under Title I of WIA. Section 239(e) and (g) provides the 
Secretary with the authority to establish the responsibilities and 
requirements for such coordination.
    Proposed Sec.  618.305 requires CSAs to ensure that the TAA 
program, as a required partner in the One-Stop delivery system, 
complies with One-Stop partnership requirements such as sharing staff, 
materials, and/or financial resources. The partnership activities help 
ensure the seamless delivery of necessary services, including a 
comprehensive array of appropriate services not funded under the Trade 
Act, to both individuals covered by petitions and adversely affected 
workers.
    Proposed Sec.  618.310 explains the CSAs' responsibilities for 
delivering employment services not funded by the Act. Proposed 
paragraph (a) addresses such employment services that CSAs must make 
available to workers covered by a petition. It implements section 
221(a)(2)(A) of the Act, which requires that, upon the filing of a 
petition for TAA, the Governor ensure that covered workers have 
available to them WIA rapid response activities (as described in 20 CFR 
665.300 and 665.310) and WIA core and applicable intensive services not 
funded under the Act. The timely provision of core and intensive 
services is an important step toward improving both the efficiency and 
the effectiveness of TAA. Further, immediately beginning the process of 
employment needs assessment improves participation rates and allows 
workers covered by a petition, whether or not the petition is 
certified, more time to consider all of the options available to them. 
Early intervention services that will benefit covered workers and 
adversely affected workers may include orientation; initial assessment 
of skill levels, aptitudes, and abilities; provision of labor market 
information; job search assistance; financial management workshops; and 
other services.
    Proposed Sec.  618.310(b) lists services that CSAs must make every 
reasonable effort to provide to workers after TAA certification, as 
required under section 235 of the Act. Because the TAA program does not 
fund a comprehensive program of reemployment services, it must be 
supplemented by services provided through the One-Stop delivery system: 
(1) Wagner-Peyser Act labor exchange system services described at 20 
CFR 651.3 to facilitate the matching of workers seeking jobs and 
employers seeking to fill jobs; and (2) WIA core and intensive services 
such as assessment, vocational testing, employment counseling, case 
management, placement and follow-up services, and development of 
individual employment plans (IEPs), as well as supportive services such 
as transportation and child care assistance.
    Proposed Sec.  618.310(c) implements section 235 of the Act by 
requiring CSAs to make every reasonable effort to ensure the provision 
of services for adversely affected workers under other Federal laws. 
This provision comports with Congress' statutory design not to 
duplicate efforts by requiring the Secretary and CSAs to seek other 
available funding streams for the provision of reemployment services to 
adversely affected workers.
    Proposed Sec.  618.310(d) permits adversely affected workers to 
receive

[[Page 50770]]

employment services from another program if they meet the eligibility 
requirements of that program, even if that program is funded under the 
Wagner-Peyser Act or WIA, or the program is not exclusively federally-
funded, in accordance with the descriptions of One-Stop partners in 20 
CFR 662.200 and 20 CFR 662.210. CSAs should explore the wide variety of 
services available through such One-Stop partners as economic 
development agencies, and community-based and faith-based organizations 
in developing a comprehensive service strategy for workers.
    Proposed Sec.  618.310(e) reminds CSAs of the availability of two 
funding sources for reemployment services for adversely affected 
workers: WIA Dislocated Worker funds for an adversely affected worker 
who meets the dislocated worker definition at WIA section 101(9); and 
WIA-funded Adult programs for adversely affected workers who remain 
partially employed and therefore do not meet the WIA definition of a 
dislocated worker. When providing services to partially employed 
workers, the CSAs should assess the likelihood of restoring full 
employment and any other of the workers' circumstances to develop 
appropriate IEPs.
    Proposed Sec.  618.315 describes reemployment services which may be 
paid for with Trade Act funds. Proposed paragraph (a) implements 
section 239(f) of the Act by requiring CSAs to provide information to 
individuals about TAA, as detailed in proposed Sec.  618.820. Proposed 
paragraph (b) follows 20 CFR 617.20(b) in describing the 
responsibilities that a CSA has for the delivery of reemployment 
services. However, since proposed paragraph (b) only lists those 
responsibilities funded under the Act, paragraphs (b)(2), (b)(5), and 
(b)(13) of 20 CFR 617.20 are inapplicable because TAA funds are not 
used to provide those services. Paragraph (a) of 20 CFR 617.20 also is 
inapplicable under the seamless system envisioned under the Act. The 
paragraph is also updated to eliminate a reference to now-inapplicable 
Title III of the Job Training Partnership Act by substituting a 
reference to the Wagner-Peyser Act and the WIA at proposed Sec.  
618.315(b)(12).
    Proposed Sec.  618.320 implements the new requirement, at section 
221(a)(2)(A) of the Act, that the Governor, upon receipt of a petition 
for TAA certification, must ensure the availability of WIA rapid 
response assistance (described as ``rapid response activities'' in 20 
CFR 665.300 and 20 CFR 665.310) and appropriate core and intensive 
services to workers covered by the petition. Under 20 CFR 665.300(a), 
which the Department also proposes to amend to address the broadened 
State responsibility to covered workers, regular rapid response 
activities follow either a permanent closure or mass layoff, or a 
natural or other disaster resulting in a mass job dislocation.
    Proposed Sec.  618.320(a) provides some flexibility for the 
Governor in providing rapid response activities to workers covered by a 
TAA petition where rapid response activities were already provided to 
those workers. In such cases, the Governor must review the rapid 
response activities already provided and determine whether it is 
necessary to provide additional information or assistance once the TAA 
petition is filed. The Governor may establish protocols and procedures 
for CSA and rapid response staff to ensure they use the most effective 
methods to notify workers about any additional benefits available to 
them under the TAA program. This advance collaboration becomes useful 
when the State learns of the filing of a petition at some time after 
the layoff has occurred.
    Proposed Sec.  618.320(b) encourages Governors to ensure access to 
appropriate core and intensive services (as described in WIA section 
134(d)(2) and (3)) for workers covered by a TAA petition by using rapid 
response activity funding. During rapid response activities, the State 
rapid response staff, in coordination with the local One-Stop delivery 
system, assesses the needs of the individuals in the petition group, as 
well as the local and State resources available to support the workers. 
Use of rapid response activity funding to help individuals access core 
and intensive services can encourage a more rapid return to employment. 
In addition, where there are insufficient partner and other resources 
to provide the necessary complementary services to these individuals, 
the rapid response activity staff may participate in analyzing the 
information gathered through the needs assessment to help develop an 
application and secure WIA national emergency grant (NEG) funding to 
bring additional reemployment services into the area to support a more 
rapid return to employment.
    Proposed Sec.  618.325 discusses strategies to ensure the 
availability of a comprehensive array of services for adversely 
affected workers. Proposed paragraph (a) requires the CSA to 
collaborate with local workforce investment boards and other One-Stop 
partners, in accordance with the Reform Act, which requires the 
Secretary to use services provided under any other Federal law, 
``including the services provided through [O]ne-[S]top delivery systems 
described in section 134(c)'' of the WIA. This regulation also 
encourages collaboration with other available programs, such as local 
faith- and community-based programs that may not be One-Stop partners, 
to increase the availability of services to adversely affected workers. 
This integration of service strategies arises from the requirement in 
section 235 of the Act that every reasonable effort be made to secure 
employment services, such as counseling, testing, placement services, 
and supportive and other services for adversely affected workers. 
Proposed Sec.  618.325(b) introduces the topic of co-enrollment of 
workers in both TAA and WIA-funded programs. The Department believes 
that co-enrollment is the best means to accomplish integration of 
services, although the Department leaves the programmatic mechanism to 
accomplish this requirement to State and local program design. CSAs may 
enhance and expand co-enrollment to include multiple enrollments with a 
broader range of service delivery partners and programs. Multiple 
enrollment resources may include Wagner-Peyser activities, vocational 
rehabilitation services, and veterans' programs such as those provided 
by the Department's Veterans Employment and Training Service. Properly 
implemented, co-enrollment or multiple-enrollment of trade-impacted 
workers in the programs offered through the One-Stop delivery system, 
as well as early provision of rapid response services, will further the 
adjustment process and promote the most rapid possible return to 
employment for all workers. Co-enrollment or multiple-enrollment also 
allows covered individuals and adversely affected workers to receive 
supportive services that may assist them in a quicker transition to 
work.
    Proposed Sec.  618.330 requires CSAs to design an assessment 
process that affords workers enough time and information to consider, 
request, and enroll in training or obtain a waiver of the training 
requirement for TRA before expiration of the 8-week and 16-week 
deadlines for enrollment in training provided under section 
231(a)(5)(A) of the Act.
    Proposed Sec.  618.335 discusses the requirements for an initial 
assessment of adversely affected workers; the first step in the process 
to determine whether the worker will need employment services and 
training and may meet the requirements for HCTC and ATAA. It should be 
noted that benefit information provided by the CSA to all adversely

[[Page 50771]]

affected workers as discussed in proposed Sec.  618.820(f), should be 
no later than at the time of the initial assessment of the adversely 
affected worker. However, the CSA may provide this information earlier, 
to a worker covered by a petition upon its receipt by the Department 
and the Governor.
    Proposed Sec.  618.335(a) lists factors that must be considered to 
find the best approaches to reemployment that are tailored to a 
worker's particular circumstances. A review of the local labor market 
conditions will help the CSA determine if any jobs are available in the 
local area for which the worker could apply. A review of the workers' 
skills from previous jobs will help the CSA determine whether the 
worker will be able to use those skills in new available jobs, or 
whether the worker's skills are too specialized to be able to be 
transferred to other available jobs. A review of any significant 
barriers to employment that may prevent the worker from obtaining 
employment will help the CSA identify available training, such as 
remedial training to get a high school equivalency degree or to provide 
English language training, to address barriers to employment.
    Proposed Sec.  618.335(b) allows CSAs to use WIA initial 
assessments and assessments performed under other WIA partner programs, 
such as those performed under the UI profiling system to identify UI 
claimants who are likely to exhaust their UI benefits, as tools for 
providing an initial assessment, as long as these other assessments 
meet the specific requirements of paragraph (a) of this section. The 
use of partner programs' assessments can increase efficiency, ensure 
that workers quickly receive appropriate reemployment services, and 
quickly identify those workers requiring a more comprehensive 
assessment of their skills. The Department recognizes that the lack of 
uniform requirements for assessments means that some assessments may 
not meet all of the TAA requirements for an initial assessment. In this 
case the CSA may be required to supplement those assessments to acquire 
sufficient information.
    Proposed Sec.  618.335(c) explains the CSA's options for service 
strategies based on the information it gathers from the initial 
assessment. If a CSA determines there is suitable employment for the 
worker, and the worker agrees with this determination, then it will 
provide WIA core and intensive services. However, if the worker 
disagrees with the determination, then the CSA must provide the worker 
with a comprehensive assessment under proposed Sec.  618.345 to be 
certain that the initial assessment is correct. If the CSA determines 
that no suitable employment is available for the worker, the CSA must 
perform a comprehensive assessment to develop a comprehensive service 
strategy for the worker and provide reemployment services funded under 
the Act, as described in proposed Sec.  618.315. The CSA may also 
provide reemployment services not funded under the Act, as described in 
proposed Sec.  618.310.
    Proposed Sec.  618.340 discusses the CSAs obligations to adversely 
affected workers not enrolled in training. Proposed paragraph (a) 
focuses on workers who are determined through an initial assessment to 
possess marketable skills for suitable employment and are reasonably 
expected to find employment at equivalent wages in the foreseeable 
future. This section recognizes that the ``suitable employment'' 
determination in the initial assessment took into account prevailing 
local labor market conditions, as required under proposed Sec.  
618.335(a)(1). Also, the CSA must provide for the worker to obtain 
referrals to suitable work, as defined in proposed Sec.  618.110, 
whichever is applicable to the worker depending on whether the worker 
is collecting regular UC or extended benefits (EB)/TRA. Actual 
referrals to suitable work are necessary to enable the worker to meet 
the EB work test, which is a condition of TRA eligibility under section 
231(a)(4) of the Act. The EB regulations appear at 20 CFR Part 615.
    Proposed Sec.  618.340(b) requires the CSA to develop a strategy to 
review the assessments of workers who may not be successful in a job 
search for suitable employment, bearing in mind the deadlines for other 
TAA benefits and services, such as TRA and training, when a worker has 
not received a training waiver. The review may result in the CSA 
developing a strategy to provide the worker with additional services to 
facilitate the search for suitable employment without TRA-approved 
training. For those workers who received a training waiver for 
marketable skills, as provided under proposed Sec.  618.725(b)(2), the 
review should be part of the periodic review of waivers issued under 
proposed Sec.  618.725(b) to determine whether the conditions for which 
the CSA issued the waivers continue to exist, which is required under 
paragraph (e) of that section. The review also may result in the CSA 
revoking a training waiver and, or initiating a comprehensive 
assessment in preparation for enrollment in training.
    Workshops provided through WIA or Wagner-Peyser Act programs can 
assist those workers with marketable skills to obtain the necessary job 
search skills. The TAA program also provides important cash assistance 
to help with this job search process, such as reimbursement for Job 
Search Program (JSP) expenses, and job search allowances for out of 
area job searches (described in subpart D, infra) and relocation 
allowances (described in subpart E, infra). Nonetheless, in scheduling 
services to be provided after their review of a worker's assessment and 
progress in finding employment, CSAs must allow enough time to complete 
a comprehensive assessment, as well as any career counseling necessary 
for the worker to make an informed training decision and maintain 
eligibility for TRA.
    Proposed Sec.  618.345 discusses the comprehensive assessment that 
the CSA must arrange for each worker seeking TAA approval of a training 
program. The comprehensive assessment must update determinations in the 
initial assessment regarding the worker's skills, aptitudes, and 
abilities (including reading and math levels), and consider the 
worker's interests as they relate to employment opportunities that are 
in demand either in the worker's commuting area, as defined in proposed 
Sec.  618.110, or, where there is no reasonable expectation of 
employment in the commuting area, outside the commuting area if the 
worker is interested in relocating. The purpose of requiring the 
comprehensive assessment is to assure that cooperating State agencies 
gather relevant information that will help the worker in selecting 
appropriate training, thus increasing the worker's chances of 
successfully completing training and finding sustainable employment 
afterwards.
    Proposed Sec.  618.350 requires the CSA to prepare an IEP, as 
defined in proposed Sec.  618.110, for any worker who receives a 
comprehensive assessment. The IEP must document the results of the 
comprehensive assessment and document a service strategy to provide the 
worker with needed services for reemployment, and it must also provide 
specific documentation on four specific items. Those four items are: 
(1) Whether the six criteria for training approval in Sec.  618.610(a) 
through (f) or for issuing a training waiver in proposed Sec.  618.725 
have been met; (2) the type of training proposed, if any; (3) any 
additional services the worker needs to obtain employment, including 
intensive services, supportive services, and post-

[[Page 50772]]

training and follow-up services, as required in proposed Sec.  
618.360(b); and (4) any financial prearrangements for the payment of 
approved training costs (as described in proposed Sec.  618.625(c)), as 
well as any amendments to the training program and any subsistence or 
transportation payments, with the basis for its calculation.
    Proposed Sec.  618.355 describes the knowledge and abilities that 
the staff performing the initial assessment should possess because the 
initial assessment is critical to proper functioning of the TAA 
program. These skills include: (1) An understanding of the local labor 
market; (2) knowledge of local employer skill demands and hiring 
prerequisites, such as educational requirements and professional 
certifications, and the sets of skills workers from various occupations 
are likely to possess; (3) the ability to identify transferable skills 
that a worker may possess that would be of interest to other local 
employers outside of the individual's present occupational area; (4) 
the ability to quickly evaluate a worker's knowledge of and ability to 
implement job search strategies with little or no assistance; and (5) 
the ability to identify a worker's apparent employment barriers that 
will require additional training and counseling. Because of the 
importance that the Department places on the assessment process and its 
central role in providing effective and efficient services to adversely 
affected workers, the Department believes that having qualified and 
knowledgeable staff to perform the assessment function is critical to 
the proper functioning of the TAA program.
    Proposed 618.360 requires CSAs to continue to provide all workers 
enrolled in approved training programs access to the reemployment 
services available under proposed Sec.  618.310 and proposed Sec.  
618.315 to assist workers as they make the transition from trainee to 
employee. The CSAs also must provide follow-up services, including 
placement and other appropriate supportive services, to adversely 
affected workers upon their completion of training. Such follow-up 
services protect the large financial investment the program made in 
training the worker by helping workers in need of such services make 
the transition back into the workforce.
    Proposed Sec.  618.365, which implements section 296(d) of the Act 
(19 U.S.C. 2401e(d)), requires the CSA to provide employment services 
to agricultural commodity producers who are entitled to cash benefits 
under the TAA for Farmers program administered by the U.S. Department 
of Agriculture. These individuals may receive training (including 
subsistence and transportation allowances), but they are not entitled 
to any other benefits under the TAA program.
Subpart D--Job Search Allowances
    Subparts D and E address job search and relocation allowance 
provisions. Proposed subpart D keeps the 20 CFR Part 617 requirements 
intact concerning allowances for job searches outside the commuting 
area. For purposes of clarity, these subparts also contain various 
editorial and procedural changes, but most changes do not affect the 
substantive requirements in the current program regulations. Proposed 
subpart E covers relocation allowances available to individuals who 
obtain suitable employment outside their commuting area. Major changes 
in subparts D and E include:
    <bullet> Changes the eligibility requirement for both job search 
and relocation allowances that there be no ``suitable work'' (a state 
UI definition) available in the local area to the requirement that 
there be no ``suitable employment'' (a national TAA definition) 
available in the local area. Since ``suitable employment'' is generally 
work at higher skill levels and wage rates than is ``suitable work,''--
meaning that a job is less likely to meet the higher ``suitable 
employment'' standard and that such jobs will therefore less likely be 
available--the proposed change would make it easier to qualify for a 
job search allowance but possibly make it harder to qualify for a 
relocation allowance.
    <bullet> Increases the limit for job search allowance reimbursement 
per individual per certification from $800 to $1,250, as well as the 
lump-sum payment for relocation from $800 to $1,250.
    The first section of subpart D, proposed Sec.  618.400, revises 20 
CFR 617.30 to reflect the goal of providing a job search allowance to 
help the worker secure ``suitable employment,'' as defined in section 
236 of the Act, instead of merely assisting the worker in finding a job 
that is ``suitable work.'' As discussed earlier in this preamble, the 
Department believes that this change will meet the intent of the Act by 
encouraging workers to find better paying jobs.
    Proposed Sec.  618.405 describes the application process but 
differs from the existing regulations at 20 CFR 617.31 on when to file 
an application. Under the current regulations, an individual who is 
covered under a petition and who is totally or partially separated may 
apply for a job search allowance before a certification is issued. 
Proposed Sec.  618.405 changes these procedures to require that 
applications for job search allowance be accepted only after a 
certification has been issued. Thus, all references in proposed subpart 
D are to ``adversely affected workers'' and not to ``individuals'' as 
in 20 CFR part 617, subpart D. This change is consistent with paragraph 
237(a)(1) of the Act, which provides that ``an adversely affected 
worker covered by a certification'' may file an application for a job 
search allowance. The Department proposes to eliminate pre-
certification applications for job search allowances to avoid 
unrealistic expectations for reimbursement. Further, because the 
Department has made great strides in reducing the time in which 
determinations are made on petitions, the Department believes there is 
less need to permit pre-certification applications. The Department has 
reduced the average processing time for petitions from 103 days in 2002 
to less than 28 days presently. Thus, for most workers, requiring 
certification prior to filing a job search application will result in 
only a short delay in filing and no delay in payment because only 
adversely affected workers may receive a job search allowance. This 
approach is similar to that of many assistance programs that generally 
do not reimburse individuals for activities conducted with their own 
resources prior to the individual becoming eligible for assistance.
    Proposed Sec.  618.405(c) also incorporates the one change that the 
Reform Act made to the time limits within which a worker must request a 
job search allowance. Prior to its amendment, section 237(b)(3) of the 
Act required that a worker apply for a job search allowance within 182 
days after concluding training approved under the Act, and 20 CFR 
617.31(c)(2) contains this time limit. However, the Reform Act amended 
this time limit by adding the condition: ``unless the worker received a 
training waiver under section 231(c).'' The Department interprets this 
statutory amendment to mean that a worker who received a training 
waiver before entering an approved training program is not entitled to 
the 182-day period after the conclusion of approved training to apply 
for a job search allowance. Rather, the worker must file a job search 
allowance application within the same 365-day deadline applicable to 
other workers under section 237(a)(2)(C) of the Act.
    Proposed Sec.  618.410 sets forth the eligibility requirements for 
job search allowances. The significant difference between this 
provision and 20 CFR

[[Page 50773]]

617.32 is that 20 CFR 617.32(a)(4) requires a CSA to determine that 
``suitable work'' is not available in the commuting area and that the 
worker has a reasonable expectation of obtaining suitable work of a 
long-term duration outside the commuting area. Proposed Sec.  
618.410(a)(4) substitutes ``suitable employment'' (as defined in Sec.  
618.110) for ``suitable work.'' ``Suitable employment'' is generally 
work at higher skill levels and wage rates than is ``suitable work.'' 
The Department believes this change will increase the availability of 
job search allowances to adversely affected workers so that these 
workers will have the financial ability to conduct job searches outside 
their commuting area. The requirement in 20 CFR 617.32(a)(3) is not 
included because proposed Sec.  618.315(b) already requires CSAs to 
provide reemployment services and the Act does not contain this 
particular registration requirement for job search allowance 
eligibility.
    Proposed Sec.  618.410(a)(4) implements the new requirement that 
the worker has not previously received a relocation allowance under 
subpart E under the same certification to clarify that job search 
allowances are inappropriate following receipt of a relocation 
allowance since a worker has already obtained work to qualify for such 
relocation allowance.
    Proposed Sec.  618.410(a)(5) allows an individual 30 calendar days 
within which to complete a job search, while 20 CFR 617.32(a)(5) 
provides ``a reasonable period not exceeding 30 days after the day on 
which the job search began'' within which to conduct a job search 
outside the commuting area. This change is made to simplify and clarify 
the rules for completing job searches. Proposed Sec.  618.410(a)(5) 
also adds language that the job search must begin after the date of 
certification, which corresponds to the change in proposed Sec.  
618.405(b) regarding the application for job search allowances after 
issuance of a certification.
    Proposed Sec.  618.410(b) describes when a job search is complete 
and comports with 20 CFR 617.32(b). A job search is not complete until 
the worker has obtained a job or has contacted each employer the worker 
planned to contact or to whom the worker was referred by the CSA or 
other One-Stop partner.
    Proposed Sec.  618.415 describes the CSA's responsibilities and 
introduces the terms ``liable State'' and ``agent State'' for 
delineating the responsibilities between CSAs with respect to job 
search allowances when a job search occurs in a different State. 
Because funding is limited, paragraph (a) requires that before 
approving a job search payment, a CSA must determine that job search 
funds are available for the fiscal year in which the job search 
activity takes place. The only proposed change under paragraph (b) is 
that it includes the employer contact verification requirement found at 
20 CFR 617.32(c), and thereby requires a CSA to verify the worker's 
contracts with employers identified in both the worker's own job search 
plan and through referrals.
    Proposed Sec.  618.420 follows the current regulations at 20 CFR 
617.34, but increases the maximum amount available for allowances from 
$800 to $1,250 based upon the 2002 Amendments. Proposed Sec.  
618.420(b) limits reimbursement to the statutory dollar limit instead 
of a particular dollar amount so that, if Congress later increases the 
dollar amount, these regulations will not have to be amended.
    Proposed Sec.  618.425, like 20 CFR 617.35, requires a worker to 
provide supporting documentation in order for payment to be made upon 
completion of a job search and require the CSA to reimburse the worker 
promptly. Paragraph (a) of this proposed section changes the language 
in 20 CFR 617.35(a) by eliminating temporal references because, under 
the changes in proposed Sec.  618.405(b), the CSA will accept 
applications for job search allowances only after a certification is 
issued. Further, paragraph (a) clarifies that job search allowance 
determinations are subject to the requirements of Sec.  618.825 
(determinations and notice) and Sec.  618.830 (appeals and hearings) 
and requires CSAs to include copies of job search allowance 
applications and determinations in the worker's case file.
    Proposed Sec.  618.425(c), like 20 CFR 617.35(c), permits the CSA 
to advance up to 60 percent of the expected cost to be paid to the 
worker.
    Proposed Sec.  618.430 implements the Reform Act amendment to 
section 237(c) of the Act to allow an adversely affected worker 
participating in a job search program [JSP] approved by the Secretary 
reimbursement for necessary expenses, including transportation and 
subsistence allowances, related to their participation in an approved 
JSP within or outside their commuting area, subject to available 
funding.
Subpart E--Relocation Allowances
    This proposed subpart covers relocation allowances available to 
workers who obtain suitable employment outside their commuting area. 
For purposes of clarity, this proposed subpart makes editorial and 
minor procedural changes, most of which do not affect substantive 
requirements. The proposed changes are discussed below.
    Proposed Sec.  618.500 revises 20 CFR 617.40 to reflect the goal of 
providing a relocation allowance to help the worker relocate to secure 
``suitable employment,'' as defined in section 236 of the Act, instead 
of merely assisting the worker in relocating to begin ``suitable work'' 
outside the worker's former commuting area (but inside the United 
States). As discussed earlier in this preamble, the Department believes 
that this change will meet the intent of the Act by encouraging workers 
to find better paying jobs.
    Proposed Sec.  618.505 retains the general discussion of relocation 
allowances found in 20 CFR 617.40, but eliminates the reference to the 
``head of the family.'' Instead, it authorizes payment to the adversely 
affected worker in the family who first applies for the relocation 
allowance, if otherwise eligible. The Department believes this minor 
change makes the test easier to administer by eliminating the need 
under the current regulations for the family to produce financial 
records indicating which family member maintains a home for the family 
by providing more than half the cost of maintenance.
    Proposed Sec.  618.510 describes the application process for a 
relocation allowance but differs from 20 CFR 617.41 on when to file an 
application. While proposed paragraph (a) is essentially unchanged from 
20 CFR 617.41(a), proposed paragraph (b) allows a worker to apply for a 
relocation allowance only after a certification covering that worker is 
issued. Thus, all references in proposed subpart E are to ``adversely 
affected workers'' and not to ``individuals'' as in 20 CFR Part 617, 
subpart E. This is consistent with section 238(a)(1) of the Act, which 
provides for ``[a]n adversely affected worker covered by a 
certification * * * [to] file an application for a relocation 
allowance. * * *'' A worker who is not covered by a certified petition 
may relocate using personal funds to take advantage of an opportunity 
outside the commuting area, but the worker will not be reimbursed for 
the costs of that relocation. As previously noted in the preamble 
discussion of proposed Sec.  618.405 (on job search allowances), the 
Department is concerned that permitting pre-certification applications 
will raise false expectations. Also, because of the substantial 
reduction in the average processing time for petitions noted in that 
discussion, there will only

[[Page 50774]]

be a short delay in workers being able to file applications.
    Proposed Sec.  618.510 also contains the basic requirement that the 
relocation may only be approved after a worker files an application and 
before the relocation is undertaken. The time limits for filing an 
application in proposed Sec.  618.510(c) are the same as in 20 CFR 
617.41(c), except that the Reform Act eliminated the second time limit 
for filing an application for a relocation allowance (as it did for 
filing an application for a job search allowance) for those workers who 
receive a training waiver. Prior to its amendment, section 238(a)(2) of 
the Act required that the individual must apply for the relocation 
allowance within 182 days after concluding training, which is reflected 
in 20 CFR 617.41(c)(2). The Reform Act amended this requirement by 
adding the condition ``unless the worker received a waiver [of the 
participation in training requirement] under section 231(c).'' The 
Department interprets this statutory amendment to mean that a worker 
who received a training waiver before entering an approved training 
program is not entitled to the 182-day period after the completion of 
approved training to apply for a relocation allowance. Thus, whenever 
the CSA grants a training waiver to a worker under proposed Sec.  
618.725, the worker must file for a relocation allowance within the 
425-day time limit after the date of certification or the worker's last 
total separation under Sec.  618.510(c)(1). Eliminating the 182-day 
period whenever the CSA grants a training waiver is consistent with the 
plain language of section 238(a) (2)(E)(ii) of the Act.
    Proposed Sec.  618.515 on eligibility for a relocation allowance 
retains essentially the same requirements as 20 CFR 617.42 
(Eligibility) and 20 CFR 617.43 (Time of relocation) but combines these 
sections, edits them for clarity and makes three significant changes. 
The requirement in 20 CFR 617.42(a)(5) is removed because proposed 
Sec.  618.310 of subpart C now requires CSAs to provide reemployment 
services and the Act does not contain this particular for relocation 
allowance eligibility.
    There is an important difference between proposed Sec.  
618.515(a)(5) and 20 CFR 617.42(a)(6) in the definition of eligibility. 
The proposed provision substitutes ``suitable employment'' (as defined 
at proposed Sec.  618.110) for ``suitable work.'' Therefore, before 
granting a relocation allowance, the CSA must determine that a worker 
has no reasonable expectation of securing ``suitable employment'' in 
the commuting area. This is consistent with the treatment of job search 
allowances and is a higher standard than the ``suitable work'' standard 
that is used in Part 617. Using ``suitable employment'' in the 
eligibility criteria for relocation allowances restricts the jobs for 
which a relocation allowance may be paid. Nevertheless, the change 
furthers the purpose of the TAA program, and the use of relocation 
allowances in particular, by improving the financial ability of workers 
to obtain new jobs with compensation and skill levels at or near those 
of the jobs from which they were separated.
    Two other significant differences between Sec.  618.515 and current 
regulations involve the timing of relocations. First, proposed Sec.  
618.515(a)(6) integrates 20 CFR 617.42(a)(7) and 20 CFR 617.43 and 
simply states the two statutory 182-day time limits for beginning a 
relocation (instead of stating that a worker must begin a relocation 
``within a reasonable period''). Paragraph (a)(6) continues to refer to 
a ``reasonable period'' for the time period for completing the 
relocation, while retaining the required factors found at 20 CFR 
617.43(a) that a CSA must consider in determining whether a worker has 
completed the relocation within a reasonable time.
    The second significant difference involves the statutory 182-day 
time limit in which the relocation must occur. The Reform Act amended 
section 238(c)(2) of the Act, which requires the worker's relocation to 
occur within 182 days after the conclusion of an approved training 
program, by adding at the end of the sentence the condition ``if the 
worker entered a training program approved by the Secretary under 
section 2296 [section 236 of the Act] (b)(1) and (2) [providing 
subsistence and transportation payments for workers in training outside 
the commuting area].'' The Department interprets section 238(c)(2) of 
the Act to mean that only a worker approved by the CSA, under proposed 
Sec.  618.640(c) and (d), to receive subsistence and transportation 
payments for training at facilities outside the worker's commuting 
area, may use the 182-day time limit after the conclusion of training 
within which to relocate. Workers not approved by the CSA to receive 
such subsistence and transportation payments, that is, workers who take 
their training within their commuting area, are ineligible for the 
additional 182-day time limit after the conclusion of training. 
Instead, their relocation must occur within the 182-day time limit 
after filing the application for a relocation allowance under Sec.  
618.515(a)(6)(i)(A).
    Proposed Sec.  618.525 simplifies, edits and updates the 
requirements for determining the amount of relocation allowances under 
20 CFR 617.45, 617.46 and 617.47. In general, a relocation allowance 
includes 90 percent of the travel and subsistence costs of the worker 
and their family to reach their new home, 90 percent of the cost of 
moving household effects, and a lump sum payment equal to three times 
the worker's average wage, not to exceed $1,250. This lump sum payment 
was raised from $800 by the Reform Act. Proposed Sec.  618.525(a)(4), 
however, does not refer to a lump sum dollar amount. Instead, it simply 
provides the citation to section 237(b)(2) of the Act so that, if 
Congress later increases the amount, these regulations will not have to 
be amended.
    Proposed Sec.  618.525 requires CSAs to follow the Federal Travel 
Regulations (FTR). Proposed Sec.  618.525(a)(2) sets reimbursement 
amounts for the family's meals and lodging at 90 percent of the lower 
of their actual meals and lodging costs or one-half the applicable 
prevailing per diem rates in the FTR. The current per diem rates can be 
found on the Internet at the following Web site: http://www.gsa.gov. 
Proposed paragraph (a)(1) refers to 41 CFR Parts 301-311 (travel) and 
proposed paragraph (a)(3) refers to 41 CFR Part 302 (movement of 
household goods). Proposed Sec.  618.525(a)(3)(ii) increases the 
allowable amount of insurance coverage of such household goods and 
effects to $40,000 from the current $10,000 found in 20 CFR 
617.47(a)(1). The Department notes that moving a house trailer or 
mobile home, as permitted under proposed Sec.  618.525(a)(3)(i), has 
special requirements under the FTR, at 41 CFR 302-10, of which the 
worker should be made aware prior to planning such a move. The specific 
sections of the FTR may be accessed on the Internet at the following 
Web site: http://www.access.gpo.gov/nara/cfr/waisidx_02/41cfrv4_02.html#301-1.
    Proposed Sec.  618.530 on the time and method of payment of a 
relocation allowance serves the same purpose as 20 CFR 617.48, although 
the proposed rule is edited for clarity and simplified. No relocation 
allowances may be paid until the worker is covered under a 
certification, makes a timely application, and is otherwise eligible, 
and the CSA must promptly make and record determinations, as well as 
make prompt payment of, relocation allowances. Any advance payments of 
relocation costs will be made at the time of the relocation or as close 
to the time of the scheduled relocation as possible,

[[Page 50775]]

but no more than 10 days before scheduled departure. Upon completing 
the relocation as described in paragraph (f) of proposed Sec.  618.530, 
the worker and the cooperating State agency will reconcile the advances 
and costs and the worker will either receive the balance of the 
allowance or repay any advance amount that might be due.
Subpart F--Training Services
    Proposed subpart F governs TAA training. TAA approval of a training 
program entitles a worker to payment of the costs of the training, 
subject to a number of limitations included in this subpart. Section 
236(a)(6) of the Act does, however, permit other funding sources to pay 
all or part of the costs of a TAA-approved training program. 
Participation in a TAA-approved training program is an eligibility 
requirement for TRA, as explained in subpart G. Major changes include:
    <bullet> CSAs would be required to ensure that every worker has a 
comprehensive assessment leading to the development of an IEP to 
facilitate appropriate training for the worker.
    <bullet> Clarifying language is added to the six criteria provided 
in the law that will enable CSAs to better determine what constitutes 
approvable training.
    <bullet> Up to 26 additional weeks of training is provided for 
individuals who need remedial education as part of their training 
program, for a total of up to 130 weeks of training.
    <bullet> Excludes the purchase of computers as part of the cost of 
a training program.
    <bullet> Allows adversely affected workers who are military 
reservists ordered to perform active duty that interrupts their 
training program to resume, repeat, or begin a new training program 
upon discharge.
    <bullet> Provides workers training flexibility by allowing CSAs to 
permit individuals to amend their training programs.
    <bullet> Allows the approval of part-time training when combined 
with employment, which gives workers the option to continue working 
while participating in training.
    <bullet> Requires the use of eligible training providers approved 
under WIA to facilitate quality training and co-enrollment for trade 
affected workers.
    <bullet> Expands worker training options by permitting distance 
learning for all or part of a worker's program where the final degree 
or certificate is equivalent to what would have been received if the 
training had been conducted on campus.
    <bullet> Allows the Department to use a formula to allocate TAA 
training funds to enable states to maximize timely training 
opportunities for workers.
    <bullet> Permits the worker to continue training at his or her own 
expense when the appropriation for training funds has been exhausted. 
This enables a worker to continue to receive TRA and HCTC.
    <bullet> Introduces customized training as an allowable activity 
under the TAA program to meet the needs of an employer or group of 
employers.
    <bullet> Makes it easier for the worker to attend employer-paid 
training by allowing the state to assume any unfunded portion of 
partially employer funded programs and by allowing the state to assume 
any liability if the worker is unable to successfully complete the 
training.
    <bullet> Makes transportation costs for travel to and from training 
payable for miles outside the worker's commuting area.
    <bullet> Facilitates the largest number of workers served by 
allowing a CSA to determine a maximum reasonable cost for training for 
the state or each local area.
    <bullet> Provides training services to individuals entitled to cash 
benefits under the TAA for Farmers program administered by the U.S. 
Department of Agriculture.
    Proposed Sec.  618.600 explains that the purpose of an approved 
training program is to assist an adversely affected worker to obtain 
skills leading to a new job as quickly and effectively as possible.
    Proposed Sec.  618.605 discusses general procedures for adversely 
affected workers to apply for training, as well as other procedures 
CSAs must follow in making determinations on applications for training. 
Proposed paragraph (a) requires CSAs to ensure that every worker has a 
comprehensive assessment leading to the development of an IEP, as 
described in proposed Sec. Sec.  618.345 and 618.350, before approving 
an application for training. The use of a comprehensive assessment in 
the development of a worker's IEP is essential to ensure the proper 
coordination and use of reemployment services to develop a successful 
training program.
    Proposed Sec.  618.605(b)(1) follows 20 CFR 617.22(d) on the use of 
forms when applying for training, but simplifies the current regulatory 
language to describe more accurately the process by which the worker 
chooses a training program and applies to the CSA for approval based on 
statutory criteria. While a worker may seek assistance from a CSA in 
selecting a training program, ultimately it is the worker and not the 
CSA who decides whether to apply to a particular training program. 
Proposed paragraph (c) differs from 20 CFR 617.22(e) by adding that the 
CSA, in making determinations on training and TAA-funded subsistence 
and transportation payments under proposed Sec.  618.640, must keep 
copies of all applications and determinations in the adversely affected 
worker's case file. The Department proposes adding this language to 
ensure that a worker's case file is complete and that it contains 
relevant information about a worker's request for training.
    Proposed Sec.  618.605(d) slightly changes 20 CFR 617.23(a) by 
clarifying that CSAs are not required to create new training programs 
or develop new curricula where none currently exist. Nonetheless, the 
Department strongly encourages CSAs to use all necessary means to find 
appropriate training where a significant void in training opportunities 
exists. CSAs, in collaboration with the local One-Stop delivery system 
and other partners, should explore how to make new training 
opportunities available either by approving out of area training or by 
encouraging training providers to provide needed training in the local 
area, as well as exploring ways in which on-the-job training (OJT), 
customized training, and other training programs can be adapted to 
accommodate workers in areas that lack training opportunities.
    Proposed Sec.  618.610, which corresponds to 20 CFR 617.22(a)(1) 
through (a)(6), implements all six statutory criteria for training 
approval. The introductory language adds a new requirement that a CSA 
must refer to a worker's comprehensive assessment and IEP before 
approving training because they will be important tools for measuring 
the proposed training against the approval criteria.
    Criterion 1, implemented by proposed Sec.  618.610(a), requires 
that there be no suitable employment available for the adversely 
affected worker. Section 236(e) of the Act provides the definition of 
``suitable employment, which appears at proposed Sec.  618.110. 
Proposed paragraph (a) generally follows 20 CFR 617.22(a)(1)(i), but 
includes the condition that a CSA must deny training approval if the 
worker is notified of a specific recall to the firm in the same or 
essentially the same job that is expected to be permanent. When recalls 
are scheduled in the foreseeable future, workers clearly do not require 
training because suitable employment is available to the worker. In 
that case, it is appropriate for the CSA to grant a waiver of the 
training requirement under the recall provision at proposed Sec.  
618.725(b)(1) to allow the worker to qualify for TRA while awaiting the 
recall. Proposed paragraph (a) also

[[Page 50776]]

explores more fully the concept of ``no reasonable prospect of such 
suitable employment in the foreseeable future'' by requiring the CSA to 
look at both the worker's skills and the local or appropriate out of 
area labor market indicators as well as the likelihood of recall.
    Criterion 2 (the worker would benefit from the appropriate 
training), implemented by proposed Sec.  618.610(b), contains similar 
requirements to the current regulation at 20 CFR 617.22(a)(2)(i). 
However, instead of referring to ``job readiness,'' criterion 2 
emphasizes that the training is expected to improve the worker's 
chances of obtaining and retaining ``sustainable employment at higher 
wages for the worker than in the absence of training.'' This change 
emphasizes the Department's belief that approved training should 
provide the worker with the skills necessary to remain employed 
throughout a career.
    Proposed Sec.  618.610(b)(2) follows the current regulations at 20 
CFR 617.22(a)(2)(i) in requiring that a worker be capable of 
undertaking, making satisfactory progress in, and completing the 
training. However, the Department proposes eliminating the phrase 
``mental and physical capabilities'' that is currently contained in 20 
CFR 617.22(a)(2)(i) and substituting the phrase ``knowledge, skills, 
and abilities'' as the test for determining whether a worker can 
undertake, make satisfactory progress in, and complete the training in 
order to eliminate any suggestion that a CSA or subrecipient may 
lawfully take the disability or disabilities of a qualified worker into 
consideration when determining eligibility for training. Section 504 of 
the Rehabilitation Act of 1973 (29 U.S.C. 794) and its implementing 
regulations at 29 CFR Part 32 and, if applicable, WIA section 188 (29 
U.S.C. 2938) and its implementing regulations at 29 CFR Part 37, 
prohibit such consideration. Both 20 CFR Part 32 and 29 CFR Part 37 
define the circumstances under which a particular individual with a 
disability may be considered ``qualified'' for a program or activity. 
See the definition of ``qualified handicapped individual'' in 29 CFR 
32.3 and 29 CFR 37.4. For the same reasons, the same change was made in 
Sec.  618.610(e) and ``knowledge, skills and abilities'' replaces the 
word ``capabilities'' in Sec.  618.610(f). For further information 
about these requirements, contact the Department's Civil Rights Center 
(CRC) as directed in the regulatory text of proposed Sec.  
618.875(i)(3).
    Proposed Sec.  618.610(b)(3) contains a new requirement that a CSA 
must not approve applications for training programs that would result 
in seasonal employment of such short duration and minimum compensation 
that a worker cannot achieve self-sufficiency, as defined by the Local 
Workforce Investment Board under 20 CFR 663.230. The Department 
believes that training that would result in this type of seasonal 
employment does not benefit the worker and would be an inappropriate 
use of limited training funds.
    Criterion 3 (there is a reasonable expectation of employment 
following the completion of such training) is implemented by proposed 
Sec.  618.610(c)(3) and corresponds to 20 CFR 617.22(a)(3). It provides 
that the CSA must assess, based on labor market information about 
present and future employment conditions and trends, whether the skills 
and education acquired while in training is likely to allow the worker 
to find a job allowing the worker to achieve self-sufficiency, as 
defined by the State or Local Workforce Investment Board under 20 CFR 
663.230.
    Criterion 3 would not require that TAA-approved training must lead 
to a job or that the CSA must create training that leads to jobs for 
adversely affected workers. The Department recognizes that there are 
situations in which tight local labor markets or significant barriers 
to employment may make it difficult or impossible to identify immediate 
job opportunities for workers. The same workers may, however, benefit 
from training by improving their abilities to compete in the labor 
market by gaining skills needed to compete for jobs. The Department 
proposes to interpret criterion 3 flexibly enough to allow CSAs to 
approve training that they determine will lead to the acquisition of 
skills that will significantly improve a worker's prospects of 
obtaining a job in the local labor market, even if job opportunities 
after completion of the training cannot be identified.
    Accordingly, proposed paragraph (c)(1) expands upon the statutory 
language discussed in 20 CFR 617.22(a)(3) by expressly providing that a 
reasonable expectation of employment does not require that employment 
opportunities for a worker be available, or offered, immediately upon 
the completion of training. However, it may not be realistic to approve 
training in an occupation in which there has been a trend of fewer and 
fewer job openings over some period of time, or where the industry in 
which the retraining is proposed has been laying-off workers with 
skills similar to those for which training is requested. This criterion 
requires TAA and One-Stop delivery system staff to continually update 
their knowledge of the local labor market and its trends.
    Proposed paragraphs (c)(2) through (c)(5) do not have counterparts 
in current regulations. Paragraph (c)(2) allows CSAs to use the demand 
occupation list maintained by the Local Workforce Investment Board, as 
required in the WIA regulations at 20 CFR 661.350 in determining 
whether there is a reasonable expectation of employment following 
training. Use of this common information source reinforces the 
relationship of the partner programs in the One-Stop delivery system 
and encourages the Local Workforce Investment Board to think broadly 
about the types of workers who that system serves. WIA permits each 
Local Workforce Investment Board to define ``demand occupation'' based 
on its unique labor market conditions, trends, and employer-identified 
skill needs. As the staff of a required partner in the One-Stop 
delivery system, TAA program staff should participate in discussions 
about how demand occupations are determined and the content of the 
list. Proposed Sec.  618.610(c)(3) places a new obligation on the CSA 
to document that there is a reasonable expectation of employment in the 
planned area of relocation when a worker desires to relocate.
    Proposed Sec.  618.610(c)(4) recognizes that a ``demand for one'' 
can exist in the local labor market, as long as that demand can be 
documented by the CSA with evidence that an employer intends to hire 
the worker upon successful completion of the training. This provision 
permits the CSA to determine that a reasonable expectation of 
employment exists in an occupation that may be a valid career choice, 
but for which there are very limited numbers of jobs in rural areas or 
in larger workforce areas where only a few skilled specialists are 
needed to meet the local demand (e.g., taxidermist or underwater boat 
repairer). Proposed paragraph (c)(5) recognizes that self-employment is 
a viable option under existing market conditions, even where there is 
no expectation that employers have positions available in a given 
occupation upon completion of training.
    Criterion 4 (training is reasonably available) is implemented by 
proposed Sec.  618.610(d) and corresponds to 20 CFR 617.22(a)(4) but 
has been simplified. This criterion requires that training be 
reasonably available to the worker from either governmental agencies or 
private sources and refers to the list of possible sources of approved 
training contained

[[Page 50777]]

in proposed Sec.  618.620, noting that the list is not exhaustive. It 
eliminates the requirement in current 20 CFR 617.22(a)(4)(ii) that 
first consideration be given to training within the worker's normal 
commuting area and that training outside the commuting area should only 
be approved if such training is not available within the commuting area 
or would cost less. A similar requirement now appears in proposed Sec.  
618.610(f)(2)(ii) as part of the sixth criterion for training approval.
    Criterion 5 (the worker is qualified to undertake and complete such 
training), implemented by proposed Sec.  618.610(e), follows the 
requirements in 20 CFR 617.22(a)(5), but has been reorganized and some 
minor provisions added. Proposed paragraph (e)(1) adds a new 
requirement directing the CSA to consult the worker's IEP or 
comprehensive assessment. Proposed paragraph (e)(2) generally follows 
20 CFR 617.22(a)(5)(ii), and stresses that the duration of the approved 
training must be commensurate with the worker's financial resources.
    Criterion 6 (the training is suitable for the worker and available 
at a reasonable cost) is implemented by proposed Sec.  618.610(f) and 
generally follows the current regulations at 20 CFR 617.22(a)(6). 
Proposed paragraph (f)(1) identifies the worker's comprehensive 
assessment and IEP as sources of information on the worker's knowledge, 
skills, and abilities, background and experience. The first sentence of 
20 CFR 617.22(a)(6)(i) is not included because it is unnecessary.
    Proposed Sec.  618.610(f)(2) discusses reasonable cost, which has 
been and continues to be a critical determinant in approving training 
programs to ensure that training funds are expended wisely, are 
available for the maximum number of adversely affected workers, and can 
also adequately support workers to ensure that they will complete their 
selected training. Proposed paragraph (f)(2)(i) includes a new cost 
prohibition against using TAA funds to purchase personal computer 
equipment for adversely affected workers to own in order for them to 
engage in a training program that requires such equipment as a 
prerequisite. However, this provision allows CSAs to purchase personal 
computer equipment which it can then lend to those workers who are 
required to have such equipment for their particular training programs. 
Certain One-Stop systems using funds under WIA have successfully 
instituted similar loan arrangements for use of computer equipment. 
Therefore, if a training program requires the use of computer 
equipment, a CSA may not approve the training if it determines that the 
worker lacks access to the necessary computer equipment. This 
prohibition will help to ensure that purchases of personal computer 
equipment for workers to own will not deplete the TAA funds available 
for training and other benefits.
    Since the amount of training funds is capped, the statute requires 
that training be approved only if it is ``available at a reasonable 
cost,'' and, once approved, a worker is entitled to payment of all the 
costs of the approved training, the Department believes it is important 
to assure that the costs of training are kept in check as long as the 
training is adequate to meet the worker's needs. Proposed Sec.  
618.610(f)(2)(ii) through (iv), as well as the proposed cost cap in 
Sec.  618.650, seek to accomplish this cost containment in several 
ways. These paragraphs restate many of the requirements of Sec.  
617.22(a)(6)(ii) and (iii). These proposed paragraphs have not retained 
the requirement, in Sec.  617.22(a)(6)(ii), that, in determining the 
reasonableness of the cost of training, the cost be compared with the 
costs of training workers in similar occupations. The Department 
believes that CSAs should have more flexibility in determining the 
reasonable cost of training, within the parameters set forth below.
    Proposed Sec.  618.610(f)(2)(ii) provides that the CSA must first 
consider the lowest cost training available in the worker's commuting 
area, if that training is of sufficient quality, content, and expected 
outcome to meet the worker's occupational goal as reflected in the 
worker's IEP, as developed under proposed Sec.  618.340. A CSA may 
approve higher cost training if it is of higher quality, content, or 
expected outcomes or is expected to achieve comparable results in a 
significantly shorter duration. The Department intends that higher cost 
training not be approved unless there is a clear (``demonstrable'') 
difference in the quality and results of the training or unless the 
same results can be achieved in a significantly shorter time, which is 
consistent with the Act's intent to get workers back into employment as 
rapidly as possible. The words ``demonstrably'' and ``significant'' 
have been included in the regulatory language to make clear that there 
must be a real and substantial benefit from a more expensive training 
program in order for it to be approvable when a good and less expensive 
training program is available.
    Proposed Sec.  618.610(f)(2)(iii) consolidates 20 CFR 617.22(b) 
into this criterion 6. It provides that training in a selected 
occupational area may not be approved if (1) it requires an 
extraordinarily high skill level, and (2) the total costs of the 
training are substantially higher than the costs of other types of 
training that are suitable for the worker. The intent of the second 
clause is to require CSAs to choose the least expensive method of 
training that provides similar results for the worker. So, for example, 
if an on-the-job training opportunity would cost $2,000 and a classroom 
training course that would teach the same skills would cost $6,000, a 
CSA must approve the OJT opportunity.
    Proposed Sec.  618.610(f)(2)(iv) follows 20 CFR 
617.22(a)(6)(iii)(C) in prohibiting approval where transportation or 
subsistence payments for training outside the worker's commuting area 
add substantially to the total cost of training, if other appropriate 
training in the commuting area is available at a lower cost. Proposed 
paragraph (f)(2)(v) introduces a new restriction. A CSA may deny 
approval of training when its costs exceed the limit on the amount of 
training per worker set by a CSA, unless that agency makes an exception 
based upon individual and exceptional circumstances, as provided in 
proposed Sec.  618.650(a). The preamble discussion of Sec.  618.650 
explains this training cap.
    Proposed Sec.  618.615 discusses the various limitations on a CSA's 
approval of a training program. In particular, proposed paragraph 
(a)(2) contains a new requirement that CSAs consider factors such as a 
worker's full- or part-time non-suitable employment, as described in 
proposed Sec.  618.630, childcare considerations, and the worker's 
course selection.
    Proposed Sec.  618.615(a)(3) corresponds to 20 CFR 617.22(f)(2), 
which limits the maximum duration of any approvable training program to 
match the duration of training to the statutory limits on income 
support since, for most workers, the availability of income support is 
critical to the ability to engage in training. The Department 
interprets the Reform Act's addition of 26 weeks of TRA for adversely 
affected workers who require remedial education, as discussed in 
proposed Sec.  618.755, to mean that Congress intended to match the 
maximum number of weeks of training with the maximum number of 
available weeks of income support (UI plus TRA). Therefore, paragraph 
(a)(3)(i) changes the current 104-week regulatory limit on weeks of 
training to include up to an additional 26 weeks of training for 
workers whose approved training includes remedial education, for a 
total

[[Page 50778]]

number of weeks of training not to exceed 130 weeks.
    This proposed paragraph also clarifies the existing regulation by 
specifically stating the current program requirement of counting 
consecutive calendar weeks when measuring the duration of training. 
This ensures that the number of weeks of an approved training program 
does not significantly exceed the number of weeks of UI plus TRA.
    Proposed Sec.  618.615(a)(3)(iii) does not have a counterpart in 
Part 617 because it concerns program changes adopted in the Reform Act. 
It requires the CSA to consult the worker's comprehensive assessment or 
IEP when determining the length of remedial education the worker needs, 
and permits a CSA to approve a training program consisting entirely of 
remedial education when such a program is appropriate for the worker. 
The Department proposes these measures to ensure that the duration of 
any remedial education component of a training program meets the 
worker's specific needs. The Department expects CSAs to approve 
remedial education programs when it is justified to help workers who 
need assistance with the basic skills of reading, writing, mathematics 
and/or language to obtain employment. When determining the type and 
length of remedial education appropriate for the worker, CSAs should 
assess the worker's basic skills to determine whether there are 
deficits in any area that necessitate remedial education. Remedial 
education may occur before, or while participating in, the requested 
training program.
    Proposed Sec.  618.615(a)(4) creates an exception to the duration 
of training requirements to meet the training needs of adversely 
affected workers who are members of a reserve component of the U.S. 
Armed Forces ordered to perform active duty service. Such workers 
should not be penalized for serving their country. The exception tolls 
the duration of training requirement so that those workers who return 
after involuntarily being called up to active duty service can re-
enroll in a training program upon their return or even begin a new 
training program. The terms, notification procedures, and documentation 
requirements in proposed paragraphs (a)(4)(i) through (a)(4)(v) 
coincide with those in the Uniform Services Employment and Reemployment 
Rights Act (USERRA) (38 U.S.C. 4301-4333), which protects reemployment 
rights of workers called to military service. These procedural 
requirements differ from those in USERRA, 38 U.S.C. 4312, when 
necessary to conform to the situation of an adversely affected worker 
enrolled or participating in a TAA-approved program.
    The Department invites comments on whether to allow other 
exceptions to the duration of approvable training programs and, if so, 
what exceptions might be appropriate. As is discussed above, a purpose 
of the proposed limits is to ensure that income support is available 
throughout the training period. However, the Department recognizes that 
not all workers need income support to complete training, and that some 
workers might have a need for a longer training program or to 
temporarily suspend training. Allowing exceptions could provide such 
workers more options. On the other hand, further exceptions could 
undermine the purpose of TAA to return a worker to worker as fast as 
possible.
    Proposed Sec.  618.615(b) greatly expands upon the current 
regulatory requirement for amending an approved training program. The 
second sentence of 20 CFR 617.22(f)(3)(ii) merely permitted an 
amendment ``to add a course designed to satisfy unforeseen needs of the 
individual.'' Proposed paragraph (b) recognizes that more substantial 
amendments may be necessary and sets forth the circumstances, and 
conditions, under which amendments, including the substitution of an 
entirely new program, may be made. Proposed paragraph (c) retains the 
single training program rule of 20 CFR 617.22(f)(2), but permits 
exceptions for amendments, as well as when an adversely affected worker 
is called for active duty as provided in paragraph (a)(4). Paragraph 
(c) thereby seeks to ensure careful expenditure of limited training 
funds in a manner that will meet the training needs of the greatest 
number of adversely affected workers.
    Proposed Sec.  618.615(d) corresponds to 20 CFR 617.22(f)(4) on 
full-time training, but differs significantly by permitting CSAs to 
approve part-time training. This section recognizes that a mix of 
training and employment suited to the worker's situation may achieve 
the sustained employment goal, and do so as quickly as possible. This 
will permit workers financially or otherwise unable to participate in 
full-time training to enroll in TAA program training opportunities to 
upgrade their skills. In particular, proposed paragraph (d)(2)(i) 
requires that the combination of part-time training and part-time 
employment must represent the equivalent of full-time employment as 
defined by the State UI law. However, the overall limitation on the 
duration of training under proposed Sec.  618.615(b) remains the same.
    Proposed Sec.  618.615(d)(ii) provides that if the hours of work 
are reduced so that the combination of part-time employment and part-
time training no longer represent the equivalent of full-time 
employment, the worker may complete that session or semester. However, 
the training approval must be rescinded beginning with the next session 
or semester, unless the combination of part-time employment and part-
time training is changed to represent the equivalent of full-time 
employment by that time. Proposed paragraph (d)(2)(ii) recognizes that 
employers may reduce workers' hours of employment or terminate 
employment during an approved training program and protects a worker by 
allowing the worker to continue in training for a period of time or to 
find other non-suitable employment or to increase his/her training 
schedule to continue in the approved training program on a part-time 
basis.
    Proposed paragraph (d)(2)(iii) also protects workers by requiring 
CSAs to ensure that workers understand the effects of part-time 
employment on receipt of UI and other TAA benefits, including the HCTC, 
to prevent their unknowingly losing benefits due to this choice. Even 
with these limitations on part-time training, this change provides a 
worker the option, if approved by the cooperating State agency, to 
choose a mix of training and employment that best suits the worker's 
situation. While the Department seeks to provide workers with greater 
flexibility in choosing training options, the primary goal of approved 
training remains returning the worker to employment as quickly as 
possible. CSAs should keep this goal in mind when determining whether 
to approve part-time training.
    Proposed Sec.  618.620 provides for the selection of training 
programs. Proposed paragraph (a) represents a change from the language 
at 20 CFR 617.23(d), which outlined the selection criteria for training 
programs and also evaluated a training provider's success by placement 
rates.
    Proposed Sec.  618.620(a) establishes the criteria for selecting 
training providers but also describes the procedures for approving 
affected worker requests for training by a training provider that is 
not on a State approved list. Under proposed Sec.  618.620(a)(1), 
training other than OJT, customized training, or training for a limited 
demand occupation must be provided to an adversely affected worker 
through a program approved under the WIA eligible training provider 
provisions. Further, proposed Sec.  618.620(a)(2) eliminates the 
reference to a training

[[Page 50779]]

provider's placement rates and requires the CSA to follow procedures 
under WIA when an affected worker requests training from a provider 
that has not been approved. Proposed Sec.  618.620(a)(3) makes an 
exception from the requirement that a training provider must be on the 
State-approved list for training in limited demand occupations if the 
training meets the requirements described in Sec.  618.610(c)(4).
    The Department believes that the TAA requirements for approving a 
training provider for an adversely affected worker should follow the 
requirements of WIA. By following the WIA approval procedures, CSAs 
would be required to ensure the credibility and accountability of 
service providers and for providing quality performance information to 
participants. Following the WIA procedures would fulfill the 
requirement of section 239(e) of the Act, which requires the Department 
to coordinate services provided under TAA with those offered under WIA. 
It would also abandon the outdated ``silo'' approach to workforce 
development and make the various programs work together more closely, 
as the Reform Act amendments contemplate. This approach also is 
consistent with section 236(a)(1)(B) of the Act, which allows training 
to be approved if the CSA determines that the worker can benefit from 
the training. Requiring CSAs to use training providers approved under 
WIA provides an assurance that workers will receive the skills needed 
to reach their employment goals because the providers have demonstrated 
that they operate effective training programs.
    To take account of possible amendments to the process of approving 
training providers in the WIA reauthorization, the Department refers to 
``eligible training providers'' under WIA rather than specifically 
referring to the Eligible Training Provider list. This revision would 
allow the TAA training requirements to change as the WIA training 
provider requirements evolve through future legislation.
    Proposed Sec.  618.620(a) does not include the language in 20 CFR 
617.23(d)(2) that describes the procedures for determining the types of 
training that may be provided, including the requirement to consult 
with local employers, appropriate labor organizations, and others. The 
Department believes this language is unnecessary because CSAs may only 
approve training by providers that have been approved under WIA 
requirements. Those requirements provide an opportunity for business 
and labor to comment on the selection procedures. Therefore, the 
Department believes that this process is sufficient to accomplish the 
same result without the additional language in 20 CFR 617.23(d)(2).
    Proposed Sec.  618.620(b) covers methods of training and generally 
follows 20 CFR 617.23(b), (c)(1) and (c)(2). Proposed paragraph (b)(2) 
provides for preference to be given to on-the-job training under 
proposed Sec.  618.635 when firm-specific training is not practical. In 
determining whether to approve OJT, the CSA must consider the six 
criteria in Sec.  618.610, as well as the availability of OJT and the 
worker's need for remedial education, and must inform the worker of the 
effect of such training on eligibility for HCTC. Because of these 
latter two new factors, added by the Reform Act, the Department has 
revised the language about the preference for OJT to make it clear that 
these new factors must be taken into account in determining what 
training method best fits an adversely affected worker's needs.
    Proposed Sec.  618.620(b)(4) is derived from 20 CFR 617.23(c)(2), 
but adds some new features. It describes institutional training methods 
and gives priority to training in public area vocational and technical 
education schools and community colleges (when it is determined that 
these schools are at least as effective and efficient as other 
institutional alternatives). The Department has added the reference to 
community colleges in recognition of their importance to the nation's 
overall training efforts. Proposed paragraph (b)(4) also expands the 
kinds of approvable institutional training specifically to include the 
increasingly popular option of distance learning, where a participant 
completes all or part of an educational or training program in a 
location remote from the institution hosting the program.
    Proposed Sec.  618.620(c), which provides a non-exclusive list of 
other specific types of approvable training programs, generally follows 
20 CFR 617.24(d), (e) and (f). However, this provision adds vocational 
and technical education to the list of approvable types of training 
because they are included in the Carl D. Perkins Vocational and Applied 
Technology Education Act, which supercedes the Vocational Education Act 
of 1963, to which section 236(a)(1)(D) of the Act refers.
    Proposed Sec.  618.625 explicates a series of restrictions on 
payments for training programs. It follows 20 CFR 617.25(b), but has 
been rewritten, simplified and condensed to eliminate certain 
redundancies. The introductory paragraph contains new language that 
specifically allows the Department to use a formula to distribute the 
statutorily-capped training funds to CSAs, as permitted under section 
236(a)(2)(B) of the Act. Distribution of TAA funds by formula adds 
predictability and regularity to the funding process, and allows CSAs 
to better plan for and manage the use of available training funds.
    Of particular note, proposed Sec.  618.625 (c) permits the CSA to 
share training costs with authorities administering other Federal, 
State, and private funding sources. It is based on section 236(a)(5)(E) 
and 236(a)(6) of the Act, allowing for the sharing of program costs, 
and follows 20 CFR 617.25(b)(2) and (b)(3). The CSA should take into 
consideration all appropriate and available funds to pay for a TAA 
training program, thereby reducing the amount of TAA training funds 
used to cover the costs. Within the One-Stop delivery system, it may be 
possible to leverage training resources, including resources for basic 
and remedial education, and specialized training for workers with 
disabilities, with other One-Stop delivery system partner programs.
    Proposed Sec.  618.625(c)(1) follows 20 CFR 617.25(b)(3)(ii)(A). It 
authorizes the CSA to share future costs of training where prior costs 
were paid from another Federal, State or private source, as permitted 
by section 236(a)(5)(E) and 236(a)(6) of the Act. However, it prohibits 
reimbursement from TAA funds of any training costs which were incurred 
and for which payment became due before the approval of the training 
program. For example, if a laid-off worker is enrolled in WIA-funded 
training (using a prearrangement discussed in proposed paragraph 
(c)(2)) in order to ensure that there is no delay in the worker's 
access to needed training because the semester will begin before the 
certification decision on the TAA petition, then TAA funds may not be 
used to pay for any costs of the training program incurred before 
certification.
    Proposed Sec.  618.625(c)(2)(i) corresponds to 20 CFR 
617.25(b)(2)(ii) and (b)(3)(ii)(A), describing prearrangements and what 
is required in prearrangement agreements. These agreements may be 
entered into on a case-by-case basis to address specific training 
situations of workers or they may be part of an overall statewide 
strategy to effectively use and maximize available resources from TAA, 
workforce development and other programs. Prearrangements help prevent 
duplication of the payment of training costs, which is prohibited by 
section 236(a)(4)(B)(i) of the Act. They also help ensure that training 
costs that are

[[Page 50780]]

reimbursable under any other Federal law are not paid from TAA funds, 
which would violate section 236(a)(4)(B)(ii) of the Act. Proposed 
paragraph (c)(2)(i) also contains a new requirement that the CSA must 
enter into an agreement with another funding source to specify how the 
worker's training program will be funded if funds become available from 
another source to pay for training after TAA funds are committed. The 
Department has added this provision for clarity because it specifically 
covers a situation not previously addressed in the regulations.
    Proposed Sec.  618.625(c)(2)(ii) follows 20 CFR 617.25(b)(3)(ii)(B) 
and is derived from section 236(a)(6)(B) of the Act. This provision 
will help avoid duplicate payments of training costs by requiring the 
worker to enter into a written agreement with the CSA providing that 
TAA funds will not be applied toward, or used to pay, any portion of 
the costs of the training that the worker has reason to believe will be 
paid by any other source.
    Proposed Sec.  618.625(c)(3)(i) follows 20 CFR 617.25(b)(4)(ii)(C). 
As required by section 236(a)(4)(C) of the Act, the CSA must not 
consider payments to the worker under other Federal laws which do not 
directly cover the costs of training in determining the amount of 
training costs payable from TAA funds. Thus, Federal student financial 
assistance paid directly to a worker is not deducted from the worker's 
TAA benefits. This is also consistent with 20 U.S.C. 1087uu, which 
prohibits Federal student financial assistance from being considered in 
determining eligibility for, or the benefit amount, under any other 
Federally-funded benefit or assistance program. To effectuate this 
prohibition, proposed paragraph (c)(3)(i) eliminates the requirement of 
20 CFR 617.25(b)(4)(ii)(C)(1) that payments of Federal student 
financial assistance to the worker be deducted from TRA.
    Proposed Sec.  618.625(c)(3)(ii) follows 20 CFR 
617.25(b)(4)(ii)(C)(2) in requiring that when other Federal funding 
sources directly pay the training provider for training costs, the 
payments must be accounted for as a direct payment of training costs 
under that other Federal law. Thus, the CSA must deduct the amount of 
those other payments from the amount of TAA funds payable to the 
training provider in order to prevent duplication in the payment of 
training costs. Generally, the CSA will use a prearrangement agreement 
to assure proper accounting for these payments.
    Proposed Sec.  618.625(d)(2)(i), modified from 20 CFR 
617.25(b)(5)(ii), prohibits the approval of a training program if the 
worker is required to pay training costs from TAA funds or any funds 
belonging to the worker from any source, subject to the limited 
exception provided in proposed paragraph (d)(2)(ii). This prohibition 
follows section 236(a)(1) of the Act, which provides that the worker is 
entitled to have the costs of approved training paid by the Secretary, 
subject to the annual training cap limitation under section 
236(a)(2)(A). Proposed paragraph (d)(2)(ii) creates a new and limited 
exception that permits a worker to contribute personal funds for the 
payment of training costs when the Director determines that all 
available funds have been allocated, and only when the CSA determines 
that no other funding from other sources is available to pay for such 
worker's training program. Where the worker chooses to pay those 
unfunded costs, the CSA is not liable to pay those costs. Where the 
worker chooses not to pay the unfunded costs, the CSA must waive the 
training requirement in order to preserve any remaining basic TRA 
eligibility under proposed Sec.  618.725(b)(6) on the basis that 
training is not available. Of course, waiving the training requirement 
will not benefit those workers who have begun receiving additional TRA 
before ceasing training due to lack of training funds. The Department 
expects CSAs to make every reasonable effort to find other funding, 
including WIA dislocated worker and NEG funds, to provide training when 
TAA funds are capped. This option should rarely be used and only as a 
last resort.
    Proposed Sec.  618.625(d)(2)(iii) is also new and addresses the 
situation where an employer or other entity agrees to fund training 
costs under conditions that may make the worker liable for all or a 
portion of those costs if certain conditions are not met. For example, 
an employer may offer separated employees paid training, but require 
the worker to reimburse the employer if the worker does not maintain a 
certain minimum grade point average (GPA). If the training is otherwise 
approvable under the Act, this proposed provision would allow the CSA 
to contract with an employer or other entity to assume any unfunded 
costs on the worker's behalf. Thus, in the above example, if the 
employer required the worker to maintain a 2.5 GPA or lose the paid 
training benefit, the worker could enroll in and receive employer-
funded training, and, if the worker later achieves only a 2.4 GPA, the 
agreement would allow the CSA to assume the cost of training and not 
force the adversely affected worker to reimburse the employer. This 
provides the CSA with greater flexibility to leverage the use of 
nongovernmental funds made available by employers and others to 
adversely affected workers.
    Proposed Sec.  618.630, which follows 20 CFR 617.22(g), derives 
from section 236(d) of the Act. This provision addresses those workers 
who cannot find suitable employment, as defined in proposed Sec.  
618.110, but who obtain non-suitable employment. These workers, while 
employed, continue to be eligible for TAA training opportunities as 
long as their proposed training meets the approval criteria in proposed 
Sec.  618.610. They may continue their employment while waiting for 
their selected training course to begin. Upon approval and enrollment 
in training, they may choose to terminate their employment, reduce the 
hours worked, or continue in either full- or part-time employment while 
taking training (as discussed in proposed Sec.  618.615(c)). The 
workers may not be determined ineligible or disqualified for UI or TAA 
program benefits, including TRA, because they left work that is not 
suitable employment. Of course, choosing to continue in such 
employment, either part- or full-time, may have negative effects on UI 
and TAA benefits, including the possible loss of the HCTC. Proposed 
paragraph (a) requires CSAs to provide written notice to warn an 
adversely affected worker who continues in non-suitable employment on a 
part-time or full-time basis while undertaking approved training that, 
due to disqualifying income, the worker may not receive any UI or TRA, 
which might then forfeit the worker's eligibility for the HCTC. 
Employed TAA participants continue to be eligible for job search and 
relocation allowances before or upon completion of their TAA training, 
as discussed in proposed Sec.  618.630(b).
    Proposed Sec.  618.635 modifies 20 CFR 617.25(a) to provide a new 
description of OJT that follows the statutory definition at section 
247(16) of the Act. This section sets forth detailed requirements for 
OJT and customized training. OJT must be provided under a contract 
between the CSA and an employer, which may be in either the public or 
private sector. Related education necessary for acquisition of skills 
needed for the position should be provided to the extent possible, 
either as part of the OJT contract or separately as approved TAA 
training. Classroom training sponsored by the employer (known as 
vestibule training) may be part of OJT and may occur either before the 
actual ``hands-on'' training or may be provided for part of the day 
with the balance of the training day in a productive setting. The IEP 
and the OJT

[[Page 50781]]

contract should specify the duration of the OJT, which must be 
appropriate to the occupation for which the adversely affected worker 
is being trained. The duration of the OJT does not need to be the same 
for the same occupation for all workers as long as it allows the worker 
to become proficient in the occupation.
    Proposed Sec.  618.635(a)(5) contains the conditions required by 
section 236(c) of the Act for approval of the costs of OJT. Proposed 
paragraphs (a)(5)(i) through (a)(5)(viii) are essentially unchanged 
from 20 CFR 617.25(a)(1) through (a)(7) and (a)(9), except for minor 
language changes. Paragraphs (a)(8) and (a)(10) of 20 CFR 617.25(a) 
have been dropped because of the repeal of the previous language of 
section 236(c)(8) of the Act, which required the employer to certify to 
the Secretary that the employer will continue to employ such worker for 
at least 26 weeks after completion of training if the worker desires to 
continue employment and the employer does not have due cause to 
terminate the employment. In the Reform Act, Congress replaced the 
former section 236(c)(8) requirement with a requirement that the 
employer be provided reimbursement of not more than 50 percent of the 
wage rate of the participant for the cost of providing the training and 
additional supervision related to the training. This requirement is now 
included in proposed Sec.  618.635(a)(4).
    Proposed Sec.  618.635(a)(6) follows the statutory provision 
requiring payments for OJT to be made to employers in equal monthly 
installments. Proposed paragraph (a)(6) changes 20 CFR 617.25(a) to 
eliminate confusion over this requirement and to clarify that it does 
not require equal dollar amounts be paid on a monthly basis. Instead, 
proposed paragraph (a)(6) permits CSAs to pay either in equal monthly 
dollar amounts or to compute the monthly payments based on the same 
rate of reimbursement for each hour worked, up to a maximum of 40 hours 
each week. Under this latter method of computation, the dollar amounts 
of the payments may fluctuate because, though paid at the same rate, 
the payments are based on different numbers of hours.
    Proposed Sec.  618.635(a)(7) is a reminder that proposed Sec.  
618.765(c) provides that workers engaged in OJT are not eligible for 
TRA because workers must be eligible for TRA to be considered eligible 
for the HCTC.
    Proposed Sec.  618.635(b) explains customized training, which is a 
new term under section 236(f) of the Act and is part of employer-based 
training under section 236(a)(5)(A) of the Act. Proposed paragraphs 
(b)(1) through (b)(3) set forth the specific requirements for 
customized training. For example, proposed paragraph (b)(3) requires 
the CSA to consider similar policies established under WIA by the State 
and Local Workforce Investment Boards in determining the portion, which 
must be at least 50 percent, of the cost of customized training paid by 
the employer.
    Proposed Sec.  618.640 discusses the requirements for TAA-funded 
subsistence and transportation payments and combines 20 CFR 617.27 and 
617.28. Proposed paragraph (b) incorporates the determination and 
notice requirements of proposed Sec.  618.825 and the hearings and 
appeals requirements of proposed Sec.  618.835 for any determination by 
a CSA on an application for supplemental assistance.
    Proposed Sec.  618.640(c) and (d) correspond to, condense, and 
rewrite for clarity 20 CFR 617.27 and 20 CFR 617.28, respectively. 
Proposed paragraph (d)(3) sets forth the calculation of the 
transportation allowance, and provides that these payments are solely 
for those miles beyond the commuting area. This is a significant change 
from 20 CFR 617.28(b), which provides an allowance for the entire round 
trip distance where training is conducted outside the commuting area. 
Section 236(b) of the Act permits, but does not require, the Department 
to pay, ``where appropriate,'' supplemental assistance necessary to 
defray ``reasonable'' transportation expenses when the training is 
outside the community area. In order to conserve the capped training 
funds for tuition, fees, books, and equipment, the Department proposes 
to limit training allowances to only those miles beyond the commuting 
area. The Department believes this change is reasonable because workers 
who travel to training within the commuting area receive no allowance.
    Proposed Sec.  618.645 establishes a new requirement for an 
adversely affected worker's voluntary withdrawal from a training 
program. Proposed paragraph (a) provides that the CSA must advise the 
adversely affected worker that eligibility to training, even though not 
completed, under the existing certification is terminated if they 
withdraw from approved training. The worker will not be able to resume 
the training program. Proposed paragraph (a) also recognizes an 
exception: If a worker ceases participation in a training program for 
justifiable cause, the worker may resume the program if it can be 
completed within the 104 or 130 week time limits of proposed Sec.  
618.615(a)(3). This provision further implements the single training 
program rule of proposed Sec.  618.615(c). Because of the limitations 
on training funds, the Department cannot afford to pay for workers to 
take more than one approved training program. However, proposed 
paragraph (b) recognizes that adversely affected workers who withdraw 
from training still may receive job search and relocation allowances if 
they meet all the eligibility requirements for these benefits as set 
forth in proposed Sec. Sec.  618.410 and 618.515.
    Proposed Sec.  618.650 provides new authority, under certain 
conditions, for CSAs to set limits on the amount of training costs 
payable for adversely affected workers. Section 236(a)(F) of the Act 
requires the Secretary to approve training suitable for the worker and 
available at a reasonable cost. The Department has interpreted 
``reasonable cost'' in proposed Sec.  618.610(f)(2) to require taking 
into consideration, among other things, ``the least cost to TAA funding 
of providing suitable training opportunities to the worker.'' This 
requires the CSA to focus on approving training for individual workers 
at the lowest reasonable cost for the particular type of training in 
that area that will enable the worker to obtain employment within a 
reasonable period of time. This focus on the lowest reasonable cost 
will result in training opportunities for the largest number of 
adversely affected workers.
    To achieve the goal of expanding training opportunities for the 
largest number of workers, the Department believes it must give CSAs 
the authority to set specific training caps as a tool to ensure they 
approve training for individual workers at the lowest reasonable costs 
which will lead to employment. Proposed Sec.  618.650 allows CSAs to 
establish training caps on a statewide or local area basis, and, if 
caps are established, requires that they be set based on the costs for 
training available in the local area. The Department is concerned that 
a state-wide training cost cap could shortchange areas of the State in 
which training costs are high. Thus, a CSA may not arbitrarily 
establish a cap. In recognition that in a large State costs may vary 
significantly from urban areas to rural areas, the State must arrive at 
a reasonable cap based upon training costs in the local areas 
throughout the State.
    Proposed Sec.  618.650(a) allows training caps to be established on 
a statewide or local area basis. If these caps are used, however, they 
must reasonably reflect the costs for training available in all the 
local areas throughout the State. The CSA must also develop standards 
and procedures for the review and approval

[[Page 50782]]

of training costs that exceed established limits, based on individual 
and exceptional circumstances. This exception to the cost cap will 
prevent the denial of a training program based solely on a cost 
limitation. While the Department expects CSAs to be judicious in 
granting exceptions, the Department recognizes that there will likely 
be a few exceptional cases in which relief from the cap is appropriate.
    The genesis of training caps goes back over a decade. The 
Department previously proposed to amend 20 CFR 617.22(b) to allow CSAs 
to establish, annually, a maximum amount allowable for the total cost 
of training for each worker. 59 FR 906, 924 (January 6, 1994). Comments 
on that proposal noted that Congress rejected a proposed $4,000 per 
worker limit on training costs because training and related costs for 
individual workers may vary significantly from one region of the 
country to another and from one worker dislocation to another. 59 FR 
924. The comments also pointed out the contradiction in requiring CSAs 
to establish a single maximum amount but then indicating that States 
should take into consideration the different types of occupational 
training and varying durations of training, which would then seem to 
render a single maximum cost meaningless. The comments also raised 
concerns that inequities would occur in setting a single amount both 
for individuals in a rural area without training facilities and for 
individuals in an urban area with training facilities. Although the 
Department abandoned its proposal, instead adopting the current 
language at 20 CFR 617.22(a)(6) making no provision for caps, some CSAs 
have expressed a desire over the past several years to have the 
flexibility to establish training caps when warranted by State and 
local circumstances.
    The Department believes that the earlier concerns on implementing 
training caps, while valid, are less of a concern under proposed Sec.  
618.650. First, the requirement that a training cap be based on the 
local area cost basis should eliminate the problem of significant 
variances in costs that would exist across regions if a single state 
cap were used. Second, the requirement to base caps on local area costs 
should guard against the possibility of workers in certain areas of a 
State being shut out of reasonably priced training opportunities in 
their local area because any cap, whether statewide or local, will have 
to consider the reasonable costs of training in that local area. 
Although not required, CSAs may choose a statewide cap based on the 
local area in the State with the highest reasonable costs of training. 
This would ensure that all workers in the State have an opportunity to 
obtain training at a reasonable cost. Third, the requirement that CSAs 
develop standards and procedures to review and approve training costs 
that exceed established limits based on individual and exceptional 
circumstances, should help eliminate the specific concerns of workers 
in rural areas who may be concerned that the lack of training 
opportunities will force them to seek higher-cost training outside 
their local area because of the need for adding subsistence and 
transportation payments as a component to their total training costs. 
This requirement also means that CSAs will continue to review 
individual training programs under the cost criteria for types and 
duration of training since reasonable training for a particular 
worker's circumstances may be approved even if it is above the 
established training cap.
    Finally, the advent of the WIA and the One-Stop delivery system, 
which focuses on forging partnerships for training and employment 
services in local labor markets to assist individuals in finding jobs, 
now provides CSAs with better information on local labor markets and 
local training opportunities, including their costs. The One-Stop 
delivery system was not in place when the Department last considered 
training caps, but this system now allows for the collection of data on 
various training programs and puts the CSA in a better position to 
gauge local training costs. Better information on local labor markets 
and on the costs and quality of various training opportunities provides 
CSAs with the ability to establish reasonable local, regional or 
statewide training caps that reflect current conditions. Thus, the 
Department believes that this current proposal addresses the earlier 
concerns about their fairness and can be implemented effectively under 
the One-Stop delivery system.
    Proposed Sec.  618.650(b) requires cooperating State agencies to 
review their training caps annually and to change them when warranted. 
Proposed paragraph (c) requires that whenever a CSA establishes, 
changes, or ceases using a training cap, the CSA must send written 
notice and full documentation supporting its action to the Director 
before establishing, changing, or ending such limits. This requirement 
allows the Department to monitor, review, and approve the cost limits 
in accordance with the criteria in proposed paragraph (a) of this 
section. The CSA's caps, or their modification or termination, will 
take effect in 30 calendar days after receipt by the Director, unless 
the Department objects in writing to the CSA.
    Proposed Sec.  618.655 implements section 296(d)(2) of the Act, 
entitling an agricultural commodity producer entitled to receive a cash 
benefit under the TAA for Farmers program (see 7 CFR Part 1580) to 
employment services and training benefits (including subsistence and 
transportation payments) under the Department of Labor's TAA program. 
Although section 296(d)(2) of the Act entitles these individuals to 
training, it does not mean that they are entitled to receive any 
training they want. Rather, the Department must place reasonable 
limitations on the approval of this training to assure that public 
funds are spent wisely for purposes for which Congress appropriated 
them. Thus, although section 296(d)(2) of the Act does not require 
application of the six criteria for training approval at section 236 of 
the Act, the Department believes that approval criteria 2 through 6 
(proposed Sec.  618.610(b) through (f)) establish reasonable conditions 
for selecting and approving training for these or any individuals. 
Criteria 2 through 6 relate to the quality of the training and the 
utility of the training for the worker and thus permit CSAs to ensure 
that the training meets the needs of affected farmers. Proposed 
paragraph (a)(1) would apply, for example, approval criteria 5, at 
proposed Sec.  618.610(e)(2), requiring, for training approval, that 
the worker have sufficient personal or family resources on which to 
live to allow completion of the training. It would make no sense to 
spend scarce training dollars on training that an individual will be 
forced to quit because of inadequate personal finances.
    The Department proposes not to apply training approval criterion 1 
(proposed Sec.  618.610(a)), that there is no suitable employment 
available except where the agricultural commodity producer actually 
obtains suitable employment, because this is the major threshold 
requirement for determining whether a worker is entitled to training. 
The Department believes that it should not stand in the way of the 
statutory training eligibility. However, all of the other provisions of 
this subpart F would apply to place reasonable parameters around this 
eligibility. Thus, for example, an approved training program for an 
eligible agricultural commodity producer (as for an adversely affected 
worker) could not exceed 104 consecutive calendar weeks, with a 
possible 26 additional calendar weeks, as needed, to complete approved

[[Page 50783]]

remedial education, per proposed Sec.  618.615(a)(3)(i).
    Proposed Sec.  618.655(a)(3) would require denial of training 
approval where the agricultural commodity producer has already obtained 
what is, in effect, ``suitable employment'' under section 236(e) of the 
Act. An adversely affected worker who obtains ``suitable employment'' 
is not entitled to training under criterion 1, requiring that no 
``suitable employment'' be available. Since an agricultural commodity 
producer does not receive wages, but instead earns income from the sale 
of a commodity, proposed paragraph (a)(3) substitutes ``average weekly 
income'' for ``average weekly wages'' in the definition of ``suitable 
employment.'' ``Average weekly income'' would be calculated based on 
the agricultural commodity producer's self-employment income earned in 
his or her most recent tax year before the notice of entitlement to a 
cash benefit under the TAA for Farmers program. ``Average weekly 
income'' would be based on ``all self-employment'' because the CSA will 
likely be unable to isolate that portion of the self-employment income 
that was the basis of the cash benefit under the TAA for Farmers 
program. By using ``average weekly income'' in the definition of 
suitable employment in proposed paragraph (a)(3), the CSA treats 
agricultural commodity producers the same as adversely affected workers 
by denying training where the agricultural commodity producer has made 
a successful adjustment by obtaining, what is, in effect, suitable 
employment.
    Proposed Sec.  618.655(b) provides that the CSA must verify 
agricultural commodity producer's entitlement to a cash benefit under 
the TAA for Farmers program in accordance with procedures established 
by the Department of Labor. Currently this is done through an approved 
Form FFA-229, ``Application for Trade Adjustment Assistance (TAA) for 
Individual Producers,'' signed by the approving official at the Farm 
Service Agency. However, the Department expects that in the future CSAs 
will be able to confirm this entitlement electronically, using a 
Department of Agriculture database.
    Proposed Sec.  618.655(c) provides that an agricultural commodity 
producer receiving training is entitled to subsistence and 
transportation payments where the CSA determines that the requirements 
of proposed Sec.  618.640 are met. It is logical and reasonable that 
those same requirements apply to agricultural commodity producers.
    Proposed Sec.  618.655(d) limits an agricultural commodity producer 
entitled to a cash benefit in multiple years for the same commodity to 
only one training program per affected commodity. Although section 
296(d)(2) of the Act could be read as permitting a new training program 
each year, that result would not be a logical or reasonable reading of 
the law. A training program approved under subpart F should give an 
individual the skills necessary to obtain new employment, and a second 
training program would be an unnecessary diversion of scarce training 
funds from better uses. If an agricultural commodity producer receives 
TAA training under a certification and a future certification is issued 
with respect to the same commodity, the individual will be considered 
to have already received the training eligibility under section 
296(d)(2) of the Act.
    Proposed Sec.  618.655(e), sets the limits on the TAA services that 
an eligible agricultural commodity producer may receive, found in 
section 296(d)(2) of the Act. Agricultural commodity producers entitled 
to a cash benefit are entitled to employment services under subpart C, 
but not any TRA under subpart G, job search allowances under subpart D, 
relocation allowances under subpart E, or ATAA under subpart I 
[reserved].
Subpart G--Trade Readjustment Allowances
    Proposed subpart G, derived from 20 CFR Part 617, subpart B, covers 
the eligibility requirements for, and the amounts and duration of, 
trade readjustment allowances (TRA). Proposed subpart G reorganizes and 
simplifies some of the parallel provisions of Part 617 to make them 
easier to follow and excludes provisions of Part 617 that have lapsed. 
Proposed subpart G also implements several Reform Act amendments to TRA 
eligibility criteria. Major changes include:
    <bullet> Allows individuals to receive wholly state-funded 
additional UI in addition to TRA to support an individual's job search 
and/or participation in training.
    <bullet> Encourages rapid re-employment by instituting deadlines 
(i.e., 8/16 enrollment deadline) for enrollment in approved training in 
order to qualify for TRA.
    <bullet> Strengthens the connection between TRA and training by 
establishing specific criteria for issuing waivers of the training 
requirement for basic TRA eligibility.
    <bullet> Increases additional TRA for workers in approved training 
from 26 weeks to 52 weeks, thus reducing the chance of a worker 
dropping out of training due to insufficient income support.
    <bullet> Permits the payment of up to an additional 26 weeks of 
TRA, which assists workers who require remedial education to have 
enough income support to complete occupational training.
    <bullet> Provides conditions under which TAA participants meet the 
definition of ``eligible TAA recipient'' for HCTC purposes, and directs 
the CSA to transmit the names of such workers to the Internal Revenue 
Service (IRS).
    <bullet> Provides prompt access to HCTC for qualified TAA 
recipients and reduces the administrative burden on state agencies for 
issuing waivers by allowing workers to receive TRA, and thus be 
potentially eligible for HCTC, without enrolling in training or 
receiving a waiver for the weeks prior to the 8/16 enrollment deadline.
    Proposed Sec.  618.700 describes the scope of this proposed subpart 
G.
    Proposed Sec.  618.705 explains that there are three categories of 
TRA: Basic, additional, and remedial. This proposed section has no 
parallel in part 617. It is intended to make the rest of proposed 
subpart G easier to follow by providing context to the references 
throughout subpart G to the three distinct types of TRA. Proposed 
paragraphs (a) and (b) identify, respectively, basic TRA and additional 
TRA and reference their respective qualifying requirements contained in 
later sections in subpart G.
    Proposed paragraph (c) addresses remedial TRA. Even though the Act 
does not explicitly refer to ``remedial TRA'' as a separate category of 
TRA, the Act, as amended by the Reform Act, implicitly recognizes 
remedial TRA as a distinct form of TRA. Section 233(g) of the Act 
permits the payment of up to 26 additional weeks of TRA, to assist 
those workers who require remedial education by providing extended 
income support while the worker completes occupational training. 
Proposed paragraph (c) makes eligibility for remedial TRA contingent 
upon the specific qualifying requirements of proposed Sec.  618.755. In 
particular, and as explained in more detail in the preamble explanation 
of proposed Sec.  618.755, remedial TRA need not be concurrent with 
participation in remedial education, as long as the adversely affected 
worker had participated in remedial education and is participating in 
approved training while receiving remedial TRA.
    Finally, in order to prevent duplication of benefits, proposed 
paragraph (d) provides that an adversely

[[Page 50784]]

affected worker may receive only one form of TRA--basic, additional, or 
remedial--for a given week of unemployment.
    Proposed Sec.  618.710 covers applications for TRA. Under proposed 
paragraph (a), a worker may apply for TRA if the worker is covered 
under either a certification or, if before a certification is issued, a 
petition. Proposed paragraph (b) provides, as does 20 CFR 617.10(a), 
that, for a TRA application filed before a certification covering the 
adversely affected worker is issued, the CSA must make those 
determinations necessary to establish or protect such worker's TRA 
entitlement and, if necessary, to protect the worker's eligibility for 
the HCTC. The reference to HCTC is added because eligibility for HCTC 
may depend upon meeting all of the TRA eligibility requirements except 
exhausting UI. The CSA must also advise an applicant that a 
determination on payment of TRA cannot be made unless a certification 
is issued.
    Proposed paragraph (c) follows 20 CFR 617.10(b), although it is 
edited for clarity. It sets the time limits for applications for TRA.
    Proposed paragraph (d) follows 20 CFR 617.10(c) in providing the 
procedures for filing TRA applications.
    Proposed paragraph (e) provides that TRA determinations are subject 
to specified requirements in proposed subpart H concerning 
determinations, appeals and hearings. It also requires that an 
adversely affected worker's case record must include the worker's TRA 
applications and the determinations on the applications. This is a new 
provision with no explicit counterpart in current regulations, but it 
merely clarifies, rather than changes or adds to, existing 
requirements.
    Proposed paragraph (f) follows 20 CFR 617.11(a)(2)(i) and 617.11(b) 
in providing that a CSA may not pay a worker TRA until a certification 
is issued covering the worker, and that an adversely affected worker 
may not be paid TRA until the first week beginning more than 60 days 
after the date of the filing of the petition that resulted in the 
certification under which the worker is covered.
    Proposed Sec.  618.715 follows 20 CFR 617.11(a)(2) in setting forth 
the requirements for basic TRA eligibility.
    Proposed paragraphs (a) through (c) follow 20 CFR 617.11(a)(2)(i) 
through (a)(2)(iii) setting three of the rules for basic TRA 
eligibility.
    Proposed paragraph (d) follows 20 CFR 617.11(a)(2)(iv) in providing 
that an adversely affected worker must have been entitled to UI for a 
week within the first benefit period, as defined in proposed Sec.  
618.110. Proposed paragraph (d) simplifies the language in the current 
regulation by eliminating references to the ``first qualifying 
separation,'' because that term is incorporated into the definition of 
``first benefit period.''
    Proposed paragraph (e)(1) requires exhaustion of UI entitlement and 
follows the requirement in 20 CFR 617.11(a)(2)(v)(A) and (B) except in 
two respects. First, proposed paragraph (e) contains an exception to 
the exhaustion requirement, under section 231(a)(3)(B) of the Act, as 
amended by the Reform Act, that exhaustion of additional compensation 
that is funded by a State and not reimbursed from any Federal funds, 
including any waiting weeks, is not required. Second, it explains that 
whenever a worker becomes entitled (or would become entitled if the 
worker had applied therefor) to UI--except additional compensation that 
is funded by a State and not reimbursed from any Federal funds--TRA 
eligibility is suspended until the worker again exhausts UI.
    Proposed paragraph (f) provides that the adversely affected worker 
must be able and available for work and must meet the EB work test 
requirements, except while enrolled in, or participating in, training 
approved under proposed subpart F. The requirements in proposed 
paragraph (f) combine the requirements in 20 CFR 617.11(a)(2)(vi) and 
20 CFR 617.17, except that the 20 CFR 617.17(a)(1) requirement that a 
worker be unemployed appears in proposed paragraph (g) of this section. 
Proposed paragraph (f) also reorganizes and rephrases the paragraphs 
containing the specified means for meeting the EB work test 
requirements in a way the Department believes is easier to follow.
    Proposed paragraph (g) provides that the adversely affected worker 
must be unemployed as defined in the applicable State law for UI 
claimants. This requirement follows 20 CFR 617.17(a)(1) and is placed 
in this section because it is a qualifying requirement for basic TRA.
    Finally, proposed paragraph (h) mirrors the ``participation in 
training'' requirement of 20 CFR 617.11(a)(2)(vii)(1). The specific 
requirements in 20 CFR 617.11(a)(2)(vii)(2) and (3) have been moved to 
a separate section, proposed Sec.  618.720.
    Proposed paragraph (h) also provides that the participation in 
training requirement does not apply to a worker before what is commonly 
referred to as the 8/16-week deadline for enrollment in training. In 
fact, there are four alternative deadlines set out in section 
231(a)(5)(A)(ii) of the Act and in proposed Sec.  618.720(c). The 
deadlines are: (1) The last day of the 16th week after the worker's 
most recent total qualifying separation; (2) the last day of the eighth 
week after the week in which the certification covering the worker is 
issued; (3) 45 days after the later of the above two dates, if there 
are extenuating circumstances to justify an extension in the enrollment 
period; or (4) the last day of a period determined by the Secretary to 
be approved for enrollment after the termination of a waiver. These 
alternative deadlines are implemented in proposed Sec.  618.720(c)(1) 
through (4) and are discussed also below in the preamble discussion of 
those paragraphs.
    The Department proposes to interpret the participation in TAA-
approved training eligibility requirement as not applying before the 
applicable deadline. Until the deadline is reached, the fact that a 
worker is not enrolled in or participating in training or has not 
received a waiver of participation in training does not preclude 
eligibility for basic TRA. Applying the participation in TAA-approved 
training requirement before the deadline would undermine one purpose of 
the deadlines, that is, to provide sufficient time to identify and make 
arrangements for an appropriate training program. Further, applying the 
participation in training requirement before the deadlines would cause 
some adversely affected workers who do not participate in training 
before the deadline to be denied eligibility for the HCTC because, by 
not meeting a requirement for TRA eligibility, they would not be 
``eligible TAA recipients'' as required to receive the HCTC. A 
Government Accountability Office (GAO) report on the TAA program, 
published on September 22, 2004, found that in a majority of the 
states, some adversely affected workers might not be enrolling in the 
most appropriate training program because the 8/16-week deadline forced 
the states into rushed assessments of the workers' needs. See pages 13-
17 of this GAO report, available at http://www.gao.gov/new.items/d041012.pdf. The Department believes that not applying the 
participation in training requirement before the 8/16-week deadline 
will prevent aggravation of this problem.
    A related issue, on which the Department seeks public comment, is 
whether the deadlines should apply to waivers of the training 
requirement in the case of adversely affected workers who do not enroll 
in training by the applicable deadline; whether the issuance of a 
waiver after the deadline

[[Page 50785]]

has passed can revive eligibility for basic TRA. The Department's 
current position, reflected in Sec.  618.725(a), is that an adversely 
affected worker who neither enrolls in training by the applicable 
deadline, nor receives a waiver of the training requirement by that 
deadline, may not become eligible for TRA by later receiving such a 
waiver. This position was articulated in the operating instructions in 
Training and Employment Guidance Letter (TEGL) No. 11-02, Change 1 (69 
FR 60903 (2004)), which interpreted section 231(a)(5)(A) as imposing 
``a deadline by which a worker must be enrolled in approved training, 
or have a waiver of this requirement, in order to be eligible for 
TRA.'' However, a CSA recently brought to the Department's attention an 
alternative reading, based on the structure of the Act, that the 
applicable deadline applies only to enrollment in training and not to 
waivers of the training requirement. The argument is that the 
alternative deadlines are contained only in the Act's provision on the 
enrollment in training requirement, section 231(a)(5)(A); that language 
in section 231(a)(5)(A)(ii) suggests the requirement applies only to 
the enrollment in training requirement in section 231(a)(5)(A)(i); and 
that the alternative requirement that the worker receive a waiver of 
the training requirement is contained in a separate provision, section 
231(a)(5)(C) of the Act. While this argument is plausible, the 
Department is concerned that it effectively undermines Congress' intent 
that TAA-eligible workers be quickly returned to work or quickly 
provided with the training they need to succeed in the labor market. In 
light of this argument, the Department encourages public comments on 
this issue.
    As noted above, proposed Sec.  618.720 provides the requirements 
governing a worker's participation in training approved under proposed 
subpart F as a condition of receiving TRA.
    Proposed paragraph (a) provides that an adversely affected worker 
must be enrolled in, participating in, or have completed training 
approved under proposed subpart F, or have a waiver granted under 
proposed Sec.  618.725 in effect by the applicable deadline for 
enrollment in training. Proposed paragraph (a) repeats some of the 
requirements in proposed Sec.  618.715(h) so that all the requirements 
related to basic TRA eligibility and all the requirements related to 
training requirements for receipt of TRA are placed in separate 
sections of the proposed rule.
    Proposed paragraph (b) is self-explanatory.
    Proposed paragraph (c) implements the enrollment in training 
deadlines, added by the Reform Act to section 231(a)(5)(A)(ii) of the 
Act. It implements the statutory requirement that, unless a worker who 
has a waiver in effect, the worker must be enrolled in training 
approved under subpart F no later than one of four alternative 
specified deadlines to be eligible for basic TRA. Proposed paragraphs 
(c)(1) through (c)(4) describe the deadlines and mirror the Act.
    Proposed paragraph (c)(3) provides an alternative deadline of the 
last day of the 30-consecutive calendar day period following the 
termination or revocation of a waiver under proposed Sec.  618.725. 
This paragraph implements section 231(a)(5)(A)(ii)(IV) of the Act, 
added by the Reform Act, which directs the Secretary to determine the 
deadline by which a worker must enroll in approved training after the 
termination of a waiver. The Department believes 30 calendar days is 
sufficient time for a worker whose waiver has been terminated or 
revoked to be advised of, and consider, training options, select an 
option, and enroll in training.
    Proposed paragraph (c)(4) implements the requirement of section 
231(a)(5)(A)(ii)(III) of the Act, added by the Reform Act, that a 
worker may have 45 additional days after the later of the 16/8-week 
deadlines, if there are extenuating circumstances that justify the 
extension. The Act does not elaborate on what are extenuating 
circumstances. Proposed paragraph (c)(4) explains that extenuating 
circumstances are unusual situations that are beyond the direct control 
of the adversely affected worker and that make enrollment within the 
otherwise applicable deadline impossible or impractical. Proposed 
paragraphs (c)(4)(i) through (iv) provide a non-exhaustive list of 
examples of extenuating circumstances.
    Finally, proposed paragraph (c)(5) provides the same exception to 
the participation in training requirement that is contained in proposed 
Sec. Sec.  618.715(h) and 618.720(a), as explained in the discussion of 
proposed Sec.  618.715(h).
    Proposed paragraph (d), derived from section 231(b)(2) of the Act, 
follows 20 CFR 617.11(a)(2)(vii)(B). It provides an exception to the 
training requirement for claims for basic TRA for weeks of unemployment 
beginning before the filing of an initial claim for TRA (within a 
reasonable period of time, as provided in proposed Sec.  618.710(c)), 
and for weeks before notification that a worker is covered by a 
certification and is fully informed of the requirements for enrollment 
in training.
    Proposed paragraph (e) interprets the terms ``enrolled in 
training,'' ``participating in training,'' and ``completed training.''
    Proposed paragraphs (e)(1) and (e)(3) interpret, respectively, 
``enrolled in training'' and ``completed training'' substantially the 
same as, respectively, paragraphs (1) and (2) of 20 CFR 
617.11(a)(2)(vii)(D); but the interpretation of ``completed training'' 
is revised for clarity.
    Proposed paragraph (e)(2) interprets ``participating in training.'' 
Part 617 does not interpret this term, despite using it throughout. 
Interpreting it in proposed Part 618 is helpful.
    Proposed paragraph (e)(2)(i) provides that an adversely affected 
worker is ``participating in training'' if the worker is attending and 
participating in all scheduled classes, required activities, and 
required events, or the training institution has excused the worker's 
absence or failure to participate. Proposed paragraph (e)(2)(i) also 
provides a mechanism for ensuring that an adversely affected worker 
does not receive basic TRA when that worker has ``ceased 
participation'' in the approved training in which the worker is 
enrolled, in accordance with Sec.  618.765(b)(3)(ii). It requires the 
training institution to certify in writing on a monthly basis to the 
CSA whether the adversely affected worker has met this requirement, 
and, if not, whether it has excused the worker.
    Proposed paragraph (e)(2)(ii) provides that an adversely affected 
worker in a distance learning program is ``participating in training'' 
if the worker is meeting all the requirements of the training 
institution. Proposed paragraph (e)(2)(ii) also provides the same 
mechanism, monthly reports, for ensuring that a worker is participating 
in the training. The Department specifically invites comments on 
whether the requirements for monthly certifications by training 
institutions of worker participation is overly burdensome and whether 
there is a better means of assuring that a worker is participating in 
training as required for TRA.
    Proposed paragraph (e)(2)(iii) provides that a worker is 
participating in training during breaks in training that meet the 
requirements of Sec.  618.760.
    Proposed Sec.  618.725 addresses waivers of the training 
requirement as a condition for receiving basic TRA. This proposed 
section, because of the Reform Act amendments, varies substantially 
from the waiver provisions in 20 CFR 617.19(a)(2) and (b) through (d).

[[Page 50786]]

    Proposed paragraph (a) provides the general rule that a CSA may 
issue to an adversely affected worker a written waiver of the training 
requirement if it finds that training is not feasible or appropriate 
for one or more of the reasons listed in paragraph (b). Proposed 
paragraph (a) also provides that no waiver of the training requirement 
is permitted for additional TRA or remedial TRA eligibility. Finally, 
proposed paragraph (a) requires, as discussed above in the discussion 
of proposed Sec.  618.715(h), that a waiver must be issued no later 
than the latest of the applicable training enrollment deadlines 
described in Sec.  618.720(c).
    Proposed paragraph (b) sets forth the permissible bases for waiving 
the training requirement, implementing Reform Act amendments to section 
231(c) of the Act. Before the Reform Act, the Act permitted waiver of 
the training requirement where training was not feasible or appropriate 
for a worker and gave the Secretary discretion to decide the criteria 
for determining whether training is feasible or appropriate. The Reform 
Act reduced the Secretary's discretion by specifying six bases, at 
least one of which must be cited in any determination that training is 
not feasible or appropriate for an adversely affected worker. Proposed 
paragraphs (b)(1) through (b)(6) identify the six bases, mostly 
verbatim from the Act; however, some of them elaborate on the statutory 
requirement, as explained below.
    Proposed paragraph (b)(1) implements the statutory waiver criterion 
that ``[t]he worker has been notified that the worker will be recalled 
by the firm from which the separation occurred.'' The Department 
believes that this means that the recall must be to the same or 
substantially the same position by the firm from which the separation 
occurred, and that the recall is expected to be permanent. In this way, 
the criteria for approval of training will work in tandem with waiver 
of the training requirement where the worker has been notified of a 
recall and ensure that the worker receives income support while 
awaiting the recall. That is, section 236(a)(1) of the Act (implemented 
in proposed Sec.  618.610(a)) requires denial of training where 
suitable employment is available, which includes a recall. However, 
section 231(c)(1)(A) of the Act (implemented in this proposed 
paragraph) provides for waiver of the training requirement where a 
worker has been notified of a recall to the adversely affected 
employment.
    Proposed paragraph (b)(1) differs from its counterpart in 20 CFR 
617.19(b)(2)(ii)(A) in that it excludes ``general'' recalls, described 
in 20 CFR 617.19(b)(2)(ii)(A)(2)(ii), from consideration in determining 
whether to issue a waiver due to a recall notice. The Department 
believes that a general recall, which by its terms does not include a 
specified date or time period for returning to work, is inherently too 
vague to rely upon for purposes of issuing a waiver of the training 
requirement. It also would simplify administration, and help ensure 
consistency among determinations on issuing waivers of the training 
requirement and denying approval of training, to require that a recall 
have a specified date or time period for returning to work in order to 
meet the requirements of both proposed paragraph (b)(1) and proposed 
Sec.  618.610(a).
    Proposed paragraph (b)(1) also differs from 20 CFR 
617.19(b)(2)(ii)(A) in requiring that a recall be permanent. The 
Department believes that it would not be appropriate to deny training 
if a worker chooses not to return to work that holds no long term 
prospect of employment. If a worker chooses to accept a temporary 
recall, the worker may remain eligible for TRA upon his/her subsequent 
separation, under the moving eligibility rules of the Act.
    Proposed paragraph (b)(2) implements the statutory waiver criterion 
that an adversely affected worker has marketable skills for suitable 
employment, and there is a reasonable expectation of employment at 
equivalent wages in the foreseeable future. The definition of 
``suitable employment'' in proposed Sec.  618.110 is used also in 
proposed Sec.  618.610(a)(1) for purposes of determining whether to 
approve training. As discussed in the preamble discussion of the 
definition of ``suitable employment,'' the Department believes that, 
despite the use of slightly different language in sections 231(c)(1)(B) 
and 236(a)(1)(A), the two provisions must be read complementarily, so 
that a worker who is denied training because of the availability of 
suitable employment is not also denied a waiver because of a 
conflicting interpretation of the phrase ``employment at equivalent 
wages'' in the waiver criteria. Proposed paragraph (b)(3) implements 
the statutory waiver criterion that the worker is within two years of 
meeting all requirements for entitlement to either old-age insurance 
benefits under title II of the Social Security Act (except for the 
requirement of application for these benefits), or a private, employer-
or-labor organization-sponsored pension. Proposed paragraph (b)(3) 
interprets entitlement to benefits under title II of the Social 
Security Act as including either full or partial retirement benefits.
    Proposed paragraph (b)(4) implements the statutory waiver criterion 
that the worker is unable to participate in training for health 
reasons. Proposed paragraph (b)(4) repeats the statutory language 
almost verbatim with no further elaboration.
    Proposed paragraph (b)(5) implements the statutory waiver criterion 
that the first available enrollment date for the approved training of 
the worker is within 60 days after the date of the waiver 
determination, or, if later, there are extenuating circumstances for 
the delay in enrollment, as determined under guidelines issued by the 
Secretary. Proposed paragraph (b)(5) repeats the 60-day deadline almost 
verbatim from the statutory language and, for consistency, implements 
the extension for extenuating circumstances by applying the test in 
proposed Sec.  618.720(b)(4) for determining whether there are 
extenuating circumstances.
    Proposed paragraph (b)(6) implements the statutory waiver criterion 
that a waiver of the training requirement may be issued if training is 
unavailable. Proposed paragraph (b)(6) implements this statutory 
provision almost verbatim with no further elaboration.
    Proposed paragraph (c) governs the contents of a written waiver. It 
provides that a waiver does not take effect unless it contains, at a 
minimum, six specific items of information. Proposed paragraph (c) is 
modified from 20 CFR 617.19(a)(2)(i) through (a)(2)(vii) to account for 
the statutory change concerning allowable bases for issuing a waiver, 
and is also slightly reorganized to make it easier to follow. In 
particular, the requirement for the recipient's signature has been 
modified, to account for current claims-taking practice, to permit 
other evidence of the participant's receipt and acknowledgement of the 
waiver.
    Proposed paragraph (d) requires that whenever a waiver request 
(whether or not made by the adversely affected worker to whom the 
request pertains) is denied, the worker to whom the denial pertains 
must be furnished with a written notice of the denial, and that the 
written notice must contain certain specified information. The 
paragraph is modified from 20 CFR 617.19(a)(3) for clarity about the 
required contents of a denial.
    Proposed paragraphs (e) and (f) implement provisions of section 
231(c)(2) of the Act, as amended by the Reform Act. Proposed paragraph 
(e) implements section 231(c)(2)(A) of the Act that a waiver of the 
training

[[Page 50787]]

requirement may be effective for not more than 6 months after the date 
on which it is issued ``unless the Secretary determines otherwise.'' 
Proposed paragraph (f) implements section 231(c)(2)(B) of the Act 
requiring revocation of a waiver if the basis of a waiver no longer 
applies, and written notification of the revocation to the worker.
    Proposed paragraph (e)(1) implements the 6-month limit with two 
additional qualifications. First, it provides that the extension may be 
for a period not to exceed 6 months or the worker's period of basic TRA 
entitlement, whichever comes first. This limitation is consistent with 
the fact that a waiver may be issued only for basic TRA. Second, the 
waiver must be reviewed every 30 days to determine if one or more of 
the bases for a waiver continue to apply. The Department believes this 
requirement would be an effective means of ensuring that the waiver 
criteria continue to be met for the duration of the waiver. Not 
regularly reviewing waivers would undermine the Act's requirement that 
waivers should remain in effect only as long as the bases for a waiver 
continue to apply.
    Proposed paragraph (e)(2) implements the statutory authority to 
extend a waiver beyond 6 months by providing two criteria that must be 
met in order for a CSA to extend a waiver. The criteria require that 
one or more of the bases for a waiver apply to the worker, and that the 
worker has not yet exhausted basic TRA entitlement. The first criterion 
permits a CSA to extend a waiver beyond 6 months as long as at least 
one of the six bases for a waiver continues to apply, even if the 
original basis or bases for issuing the waiver no longer apply. This 
criterion implements the statutory mandate that a waiver be in effect 
only if specified criteria are met. The Department includes the second 
criterion because extending a waiver of the training requirement would 
be pointless if the worker has exhausted basic TRA eligibility. The 
Department believes these criteria provide the maximum flexibility to 
extend a waiver within the spirit of the statutory requirements for 
such waivers.
    Proposed paragraph (f) implements the statutory requirement that a 
waiver must be revoked if none of the six specified statutory bases for 
a waiver continues to apply. It requires the CSA to revoke a waiver if 
the waiver criteria are no longer met, and to notify the adversely 
affected worker in writing of the revocation. The notice would be 
required to contain the same information as a denial of waiver issued 
under proposed paragraph (d). Proposed paragraph (g) implements the new 
statutory requirement added by the Reform Act to section 231(c)(3)(B) 
of the Act that CSAs submit to the Secretary the written waivers of the 
training requirement issued under the Act and a statement of reasons 
for each waiver. Proposed paragraph (g) implements this requirement by 
requiring CSAs to transmit a copy to the appropriate Regional 
Administrator of any or all waivers or any or all revocations of 
waivers together with a statement of the reasons for the waiver or 
revocation. As a practical matter, a separate statement of reasons will 
not need to be submitted if the waiver follows the requirements of 
proposed paragraphs (c) and (f) and contains the reasons for the waiver 
or revocation.
    Proposed Sec.  618.730, modeled after 20 CFR 617.12, provides the 
requirements for evidence of qualification for basic, additional, and 
remedial TRA.
    Proposed paragraph (a), containing the basic requirement that CSAs 
obtain the basic information necessary to establish whether a TRA 
applicant is eligible to receive TRA, is substantially the same as 20 
CFR 617.12(a). However, proposed paragraph (a) excludes the requirement 
in 20 CFR 617.12(a)(2) that a State agency must obtain a TRA 
applicant's average weekly wage. This information is not 
administratively necessary in the case of a TRA applicant who is 
totally separated from adversely affected employment.
    Proposed paragraphs (b) and (c) on obtaining alternative 
information where records are unavailable include only one change from 
20 CFR 617.12(b) and (c). Where 20 CFR 617.12(c) requires verification 
by the employer of information received from other sources, proposed 
paragraph (c) requires such verification only ``if possible.'' This 
change acknowledges that in some cases the employer might have gone out 
of business, so that obtaining the required verification is virtually 
impossible.
    Proposed paragraph (d), concerning the data on which a CSA must 
base a determination on TRA entitlement and benefit amounts, is 
substantively similar to 20 CFR 617.12(d), but, rather than requiring 
the CSA to make adjustments to the suspect data and make its 
determinations on the basis of the adjusted data, requires the CSA to 
make its determinations from the best available information. The 
Department believes that this change provides CSAs with more 
flexibility.
    Proposed Sec.  618.735, governing the determination of a worker's 
weekly amount of TRA, whether basic, additional, or remedial, is 
modeled on 20 CFR 617.13.
    Proposed paragraphs (a) and (b) are substantively the same as their 
counterparts in, 20 CFR 617.13(a) and (b).
    Proposed paragraph (c), requiring specified reductions to the TRA 
weekly amount, closely follows 20 CFR 617.13(c). However, proposed 
paragraph (c)(2) is modified from 20 CFR 617.13(c)(2) in order to 
resolve a conflict between the Act and another Federal statutory 
provision. The conflict is between section 232(c) of the Act, requiring 
a worker's TRA weekly benefit amount to be reduced by the amount of a 
training allowance the worker received for that week under any other 
Federal law, and another Federal statutory provision, at 20 U.S.C. 
1087uu, that prohibits Federal student financial assistance from being 
considered in the determination of a Federal student financial 
assistance recipient's eligibility for or benefit amount under any 
other Federally funded benefit or assistance program. The provision at 
20 CFR 617.13(c)(2) interprets training allowances referred to in 
section 232(c) of the Act as including specified types of payments that 
constitute Federal student financial assistance under 20 U.S.C. 1087uu.
    Proposed paragraph (c)(2) resolves this conflict by requiring that 
no reduction of the TRA weekly amount be made for the receipt of 
Federal student financial assistance, as defined in proposed Sec.  
618.110. It further provides that in the case of a worker to whom such 
Federal student financial assistance is available, the State must rely 
on prearrangements for the sharing of costs under proposed subpart F in 
order to harmonize the provision of such Federal student financial 
assistance with the worker's TRA entitlement. The Department believes 
that prearrangements can be used to harmonize TRA with the provision of 
Federal student financial assistance consistent with the requirements 
of both otherwise conflicting statutory requirements. Under such a 
prearrangement, the agency responsible for providing Federal student 
financial assistance might, to the extent provided for under its laws, 
adjust that assistance in view of the worker's receipt of TRA.
    Proposed Sec.  618.740, on calculating the maximum amount of basic 
TRA, follows 20 CFR 617.14, with a few substantive and organizational 
differences. The calculation in proposed paragraph (a) is substantively 
the same except for two differences. The first difference is that 
additional compensation (defined at proposed Sec.  618.110) is not 
included in

[[Page 50788]]

the total sum of UI that must be subtracted as part of the calculation 
of the maximum amount of basic TRA. This difference results from an 
amendment by the Reform Act to section 231(a)(3)(B) that a worker need 
not exhaust additional compensation funded by a state and not 
reimbursed from federal funds to qualify for TRA. The purpose of that 
amendment was to allow a worker to collect TRA even though he or she 
was entitled to additional compensation, which the worker might then 
collect after exhausting TRA. To deduct such additional compensation 
from a worker's TRA would defeat this purpose.
    The second difference concerns the reduction for the total sum of 
the adversely affected worker's UI entitlement. Section 617.14(a)(2) 
provides that a worker's UI reduction must include, in addition to any 
UI the worker actually received, any UI to which the worker would have 
been entitled had the worker applied for it during the worker's first 
benefit period. The last sentence of that paragraph adds that in 
calculating the worker's maximum TRA amount, the worker's full UI 
entitlement for the first benefit period must be subtracted, regardless 
of the amount, if any, actually paid to the worker. This last sentence 
created an unintended result in recent years for workers who, after 
they began receiving TRA during their first benefit period, became 
eligible for extended benefits or benefits under the Temporary Extended 
Unemployment Compensation (TEUC) program. For example, assume that 
three weeks before a worker's benefit year ends, the worker becomes 
eligible for a TEUC maximum benefit amount of 13 weeks. If the worker 
is entitled to regular UI in a second benefit year, that regular UI 
entitlement means the worker is not eligible for TEUC as of the start 
of the second benefit year. Therefore, the worker could have collected 
at most three weeks of TEUC. However, because of the last sentence in 
20 CFR 617.14(a)(2), all 13 weeks of TEUC would be deducted from the 
basic TRA maximum benefit amount, even though the worker could not have 
collected 10 weeks of it.
    These workers would have their basic TRA maximum amount reduced by 
the full potential amount of the extended UI entitlement during their 
first benefit period, whether or not they were actually paid that full 
potential entitlement or could even actually qualify for the entire 
amount. In some cases, this resulted in workers having their maximum 
amount of TRA reduced to an amount below what they already had 
received, which resulted in TRA overpayments being established, despite 
these workers having received TRA for weeks of unemployment for which 
they were not eligible for any UI. Because these workers lawfully 
received TRA for weeks of unemployment for which they were not eligible 
for UI, and could not have known that they would become eligible for 
extended UI at a later time during their first benefit period, it seems 
contrary to the Act to declare the lawfully received TRA payments to be 
overpayments. Upon further review of the legislative history, the 
Department has determined that the Act does not compel the reduction of 
the TRA maximum amount by the full potential UI entitlement during the 
first benefit period.
    Therefore, the Department proposes to exclude the last sentence of 
20 CFR 617.14(a)(2) from proposed paragraph (a) of Sec.  618.740 so 
that no deduction will be made from the basic TRA maximum benefit 
amount for the potential amount of extended benefits or TEUC that could 
not be received. However, excluding this provision potentially could 
cause another problem: a worker could receive basic TRA for weeks for 
which the worker did not receive UI because of State UI law 
disqualification provisions. Even though the disqualification 
provisions at proposed Sec.  618.765(a) prohibit that result, proposed 
Sec.  618.740(a) arguably could be read as conflicting with proposed 
Sec.  618.765(a). To avoid any conflict, and because the Department 
believes it would defeat the purpose of the disqualification provisions 
to allow workers to receive TRA for such weeks, the Department proposes 
requiring the UI reduction to include the total sum of UI the worker 
would have received in the worker's first benefit period had such 
worker ``either applied therefor or not been subject to a 
disqualification under the applicable State law.''
    Proposed paragraph (b), which contains exceptions to the maximum 
TRA amount calculation is substantively unchanged from 20 CFR 
617.14(b)(1) and (2). However, proposed paragraph (b) excludes language 
in 20 CFR 617.14(b) that nothing in that paragraph will affect an 
individual's eligibility for the allowances described in that 
paragraph. The Department believes this language is unnecessary.
    Finally, another difference between proposed Sec.  618.740 and 20 
CFR 617.14 is that the heading for proposed Sec.  618.740 explicitly 
provides that this section applies only to calculating the maximum 
amount of basic TRA. The heading for 20 CFR 617.14 does not contain 
this limitation, but 20 CFR 617.14(b)(3) effectuates the same result by 
explicitly excluding additional TRA from the maximum amount 
calculation. The Department believes it can accomplish the same thing 
simply by modifying the section heading.
    Proposed paragraph (c), which requires reductions of the maximum 
TRA amount for the receipt of Federal training allowances under other 
programs, follows 20 CFR 617.14(c), but has substantive differences. 
Proposed paragraph (c)(1) requires a worker's total number of weeks of 
TRA eligibility to be reduced by the number of weeks for which the 
worker both receives a training allowance referred to in proposed Sec.  
618.735(c)(2) and would be eligible to receive TRA. However, unlike 20 
CFR 617.14(c)(1), no deduction would be made for the receipt of Federal 
student financial assistance. As explained above, in the discussion of 
proposed Sec.  618.735(c)(2), such a deduction would conflict with 20 
U.S.C. 1087uu. Proposed paragraph (c)(1) provides for prearrangements, 
as does proposed Sec.  618.735(c)(2).
    Proposed paragraph (c)(2) requires that if a training allowance 
from another training program is less than the TRA weekly benefit 
amount for a given week, then the worker must receive a TRA amount for 
that week not to exceed the difference between the worker's regular TRA 
weekly amount calculated under proposed Sec.  618.735(a) and the amount 
of the training allowance paid to the worker for that week. Proposed 
paragraph (c)(2) contains the same requirement for the treatment of 
Federal student financial assistance as proposed paragraph (c)(1).
    Proposed Sec.  618.745, establishing the basic TRA eligibility 
period, is substantively different from 20 CFR 617.15(a). Proposed 
paragraph (a) implements the requirement in section 233(a)(2) of the 
Act, as amended by the Reform Act, that provides that the 104-week TRA 
eligibility period will be extended to a 130-week period where 
necessary for an adversely affected worker to complete remedial 
education approved under the Act.
    Proposed paragraph (b) is an entirely new provision. It addresses 
situations where, because of the delays associated with litigation over 
the denials of certifications of petitions, certifications are issued 
so late that workers covered under the certification would not have 
enough time during which they could be paid basic or additional TRA to 
be able to complete approved training. Proposed paragraph (b) remedies 
this by providing that, as long as the petitioner or the adversely 
affected worker did not contribute to the delay in issuing the

[[Page 50789]]

certification, for example, failing to meet filing deadlines or 
repeatedly requesting extensions of filing deadlines, the basic TRA 
eligibility period will be extended for a period, decided on a case-by-
case basis, necessary to provide an eligibility period for basic and 
additional TRA, and remedial TRA, if needed, that would provide a 
worker TRA through completion of approved training. The Department 
believes that in these cases, the adversely affected workers should not 
be unfairly penalized by not receiving TRA throughout their approved 
training. The Department proposes paragraph (b) to restore such workers 
to the position they would have occupied had the certification covering 
them been issued without the delay.
    For the same reasons, proposed paragraph (c) extends this exception 
to cases in which a CSA's determination that a worker is ineligible for 
TRA is ultimately reversed through reconsideration or appeal. 
Conforming provisions in proposed Sec. Sec.  618.720(d)(2) and 
618.750(a)(3) modify the training enrollment deadline and the deadline 
for a bona fide training application for a worker whose initial TRA 
negative determination is reversed on reconsideration or appeal. 
Without these modifications, a worker might miss these deadlines 
through no fault of the worker, but because of the delay in finding the 
worker eligible.
    Proposed Sec.  618.750, establishing the qualifying requirements 
for, and duration of, additional TRA, has no specific counterpart in 20 
CFR Part 617; however, most of the provisions in proposed Sec.  618.750 
are contained in various sections of 20 CFR Part 617. The Department 
believes including a section governing only additional TRA in proposed 
Part 618 would make the TRA requirements easier to follow than the 
current regulations.
    Proposed paragraph (a) contains additional TRA qualifying 
requirements and is, in substance, unchanged from the current 
regulations in 20 CFR 617.11(a)(2) (TRA qualifying requirements), 
617.15(b)(2) (training application filing deadlines), and 617.15(b)(3) 
(requirement of participation in training except during breaks in 
training).
    Proposed paragraph (b), governing the duration of additional TRA, 
closely follows the definition of ``eligibility period'' for 
``additional TRA'' in 20 CFR 617.3(m)(2). The only substantive 
difference is that an adversely affected worker may receive up to 52 
weeks of additional TRA, rather than up to 26 weeks, because of the 
Reform Act's amendment to section 233(a)(3) of the Act.
    Proposed Sec.  618.755, providing the qualifying requirements for, 
and duration of, remedial TRA, is a new section because remedial TRA 
added by the Reform Act. Under section 233(g) of the Act, remedial TRA 
may be paid only ``in order to assist an adversely affected worker to 
complete training approved for the worker under section 236 which 
includes a program of remedial education.'' The Department would 
implement this requirement in proposed paragraphs (a)(2) and (a)(3) by 
requiring participation in remedial education and that such 
participation must have caused training to extend beyond the period for 
which basic and additional TRA were payable. Additionally, the 
Department believes that because the Act does not provide any other 
distinctions between remedial TRA and other types of TRA, an adversely 
affected worker also must, as a condition for receiving remedial TRA, 
meet the qualifying requirements for receipt of basic TRA, as would be 
required by proposed paragraph (a)(1).
    Section 233(g) of the Act authorizes payment of remedial TRA for 
``up to 26 * * * weeks in the 26-week period that follows the last week 
of entitlement to [TRA] otherwise payable under this chapter.'' The 
Department interprets this provision as requiring that remedial TRA be 
paid during a 26-consecutive calendar week period; that remedial TRA be 
paid only for the same number of weeks, but not exceeding 26, that the 
worker participates in remedial education; and that remedial TRA be 
paid only after exhausting basic and additional TRA. These 
interpretations are reflected in proposed paragraph (b).
    The Department recognizes that permitting payment of remedial TRA 
only after exhaustion of basic and additional TRA could create an 
apparent anomaly because most workers would not be enrolled in remedial 
education concurrent with receipt of remedial TRA. This is because, in 
many cases, the remedial education component of an approved training 
program would occur early in the program. Therefore, proposed paragraph 
(a)(2) provides that participation in remedial education may occur 
either during or before the week for which remedial TRA is claimed. 
Further, since nothing in the Act prohibits a worker receiving basic or 
additional TRA for weeks in which the worker participates in remedial 
education, proposed paragraph (c) clarifies that a worker may receive 
basic or additional TRA for those weeks that exceed the 26-week maximum 
for which remedial TRA may be paid or that fall outside the required 
26-consecutive calendar week period.
    Proposed Sec.  618.760, governing payment of TRA, whether basic, 
additional, or remedial, during breaks in training, is substantially 
the same as 20 CFR 617.15(d) except that, as the result of a Reform Act 
amendment to section 233(f) of the Act, it extends the maximum number 
of days a break may last without interrupting TRA payments from 14 days 
to 30 days. Proposed Sec.  618.760 omits provisions in 20 CFR 617.15(d) 
(5) and (6) that clarify requirements for the maximum amount of basic 
TRA and the basic and additional TRA eligibility periods. These 
clarifications would be unnecessarily duplicative in proposed Sec.  
618.760. The requirements in 20 CFR 617.15(d)(5), concerning the effect 
of breaks in training on the basic TRA maximum amount and the basic TRA 
eligibility period, are effectuated by proposed Sec. Sec.  618.740 
(maximum amount of basic TRA) and 618.745 (basic TRA eligibility 
period). The requirement in 20 CFR 617.15(d)(6), concerning the running 
of the additional TRA eligibility period for weeks during which 
additional TRA is not paid, is effectuated by proposed Sec.  618.750(b) 
(duration of additional TRA).
    Proposed Sec.  618.765, governing disqualifications from receiving 
TRA, is substantively unchanged from 20 CFR 617.18, except for changes 
in 20 CFR 617.18(b) reflected in proposed Sec.  618.765(b)(2) and (3). 
Proposed paragraph (b)(2), providing for the disqualification from 
receipt of TRA for workers enrolled in approved training under certain 
conditions, contains the same requirements as in 20 CFR 617.18(b)(2) 
except that it adds clarifications.
    Proposed paragraph (b)(2)(i) follows 20 CFR 617.18(b)(2)(i), with 
two modifications. One modification is that proposed paragraph 
(b)(2)(i) omits language in 20 CFR 617.18(b)(2)(i) that a 
disqualification under that paragraph applies to not just basic TRA but 
also to ``any other payment'' under Part 617. The Department believes 
this language is partly inaccurate and partly unnecessary. It is partly 
inaccurate because participation in training is not an eligibility 
requirement for job search or relocation allowances or Alternative TAA 
for Older Workers, so that a TRA disqualification under (b)(2)(i) would 
not affect the worker's entitlement to those payments. It is partly 
unnecessary because provisions in other sections of this proposed 
subpart G and other proposed subparts are sufficient to ensure that a 
worker who fails to meet the participation in training requirement

[[Page 50790]]

would not receive benefits for which participation in training is 
required as a condition of receiving such benefits. Specifically, 
proposed Sec. Sec.  618.750 and 618.755 prohibit payment of, 
respectively, additional TRA and remedial TRA for any week in which the 
worker did not participate in training, and proposed Sec.  618.840(g) 
requires establishment of overpayments for a worker who, without good 
cause, does not complete training approved under proposed subpart F.
    Second, proposed paragraph (b)(2)(i) includes two clarifications 
not contained in 20 CFR 617.18(b)(2)(i). The first is that a worker who 
has justifiable cause (as described in paragraph (b)(3)(iii)) for a 
failure to begin, or cessation of participation in, training may 
receive basic TRA for any week in which such failure or cessation 
occurred if the worker otherwise meets the requirements of this subpart 
G. The Department believes that if a worker is unable to begin or 
continue participation in training through no fault of the worker, it 
is appropriate to permit the worker to continue to collect basic TRA. 
Since, in some cases, the deadlines for granting a waiver set forth in 
Sec.  618.720(c), will have passed, this exception will allow such 
workers to continue to collect basic TRA. The second clarification is 
that failure to begin participation in training, cessation of 
participation in training, or revocation of a waiver does not change 
the eligibility periods in proposed Sec. Sec.  618.745, 618.750(b), and 
618.755(b), even if the worker had justifiable cause.
    Proposed paragraphs (b)(2)(ii) and (b)(2)(iii) are new provisions, 
but they only provide clarifications of TRA requirements rather than 
create new substantive requirements. Proposed paragraph (b)(2)(ii) 
provides that no adversely affected worker may receive additional or 
remedial TRA for any week in which the worker failed to participate in 
training, regardless of whether such worker had justifiable cause. This 
is merely a clarification to reinforce the requirement already 
contained in proposed Sec. Sec.  618.750 and 618.755, which cover the 
qualifying requirements for and duration of additional and remedial 
TRA. This clarification would be helpful because a person reading 
proposed Sec.  618.765 in isolation might overlook the requirement that 
a worker must, with no exceptions except for breaks in training that 
meet the requirements of proposed Sec.  618.760, participate in 
training for every week for which the worker receives additional or 
remedial TRA.
    Proposed paragraph (b)(2)(iii) provides that the disqualification 
in proposed paragraph (b)(2)(i) does not apply to an adversely affected 
worker for TRA claims for weeks beginning before the filing of an 
initial claim for TRA, nor for any week beginning before the worker is 
notified that he or she is covered by a TAA certification and is fully 
informed of the disqualification rules. This provision restates an 
exception to the participation in training requirement provided in 
proposed Sec.  618.720(d). Like proposed paragraph (b)(2)(ii), this 
clarification would be helpful because a person reading proposed Sec.  
618.765 in isolation might otherwise overlook the exception to the 
participation in training requirement contained in proposed Sec.  
618.720(d).
    Proposed paragraph (b)(3) provides the interpretation of three 
terms used in proposed paragraph (b)(2). Proposed paragraphs (b)(3)(i) 
and (b)(3)(ii) interpret, respectively, ``failed to begin 
participation'' and ``ceased participation'' in training the same as 
the current regulation in 20 CFR 617.18(b)(2)(ii)(A) and (B). In 
requiring in both interpretations that a worker participate in all 
classes and activities in the training program, the Department intends 
that the worker be disqualified from receiving TRA if the worker misses 
even a single class or activity in the training program in a week 
without good cause. The Department believes that TAA-approved training 
is meant to provide adversely affected workers with the opportunity to 
find new employment as quickly and efficiently as possible. The 
Department believes that the best way to effectuate this intent, to 
ensure that TAA funds are effectively spent, and to improve program 
performance, is to require that the workers who receive those funds 
participate in each and every class and activity in their approved 
training program unless excused by the training provider.
    Proposed paragraph (b)(3)(iii) interprets ``justifiable cause'' 
very similarly to 20 CFR 617.18(b)(2)(ii)(C), but with four changes. 
Proposed paragraph (b)(3)(iii) slightly rephrases the basic 
interpretation of ``justifiable cause;'' excludes the examples used in 
20 CFR 617.18(b)(2)(ii)(C); adds an example not contained in 20 CFR 
617.18(b)(2)(ii)(C); and adds a requirement that CSAs determine whether 
``justifiable cause'' exists on a case-by-case basis.
    First, the basic interpretation of ``justifiable cause'' in 
proposed paragraph (b)(3)(iii) requires the reasons for the worker's 
conduct to be compared to the conduct expected of a reasonable worker 
in the ``same or similar'' circumstances, rather than in ``like'' 
circumstances, as provided in 20 CFR 617.18(b)(2)(ii)(C). The 
Department believes this change is clearer and easier to administer 
than the previous test.
    Second, the exclusion of the examples in 20 CFR 617.18(b)(2)(ii)(C) 
does not mean the reasons listed in the current regulation no longer 
are valid; rather, the Department believes the reasons themselves are 
somewhat vague and not necessarily very helpful.
    Third, the new example in proposed paragraph (b)(3)(iii) is that an 
excused absence under a training institution's written policy may be 
considered ``justifiable cause.'' The Department believes that the 
specific inclusion of excused absences as justifiable cause ameliorates 
any arbitrary effects of the rule that a worker must attend all classes 
and activities to avoid disqualification by recognizing that there will 
be situations in which nonattendance at a class or activity is 
justified by other needs of the individual or the individual's 
training.
    Fourth, the additional language on case-by-case determination has 
no parallel in the current regulation but also, in the Department's 
view, does not change the current requirements. Rather, this language 
would merely codify what already is done in practice in the States.
    Proposed paragraph (b)(3) applies to distance learning as well as 
to institutional training. Distance learning may, in some cases, be 
more self-paced than institutional training, which usually requires 
physical attendance at specific classes. CSAs will need to work with 
distance learning providers to understand the specific requirements or 
milestones of the distance learning program and to make sure that the 
training provider keeps the agency informed of the student's adherence 
to those requirements.
    Finally, proposed paragraph (c), prohibiting payment of TRA to a 
worker for any week during which the worker is receiving on-the-job 
training, is substantively identical to 20 CFR 617.18(c) but rephrased 
for clarity and simplicity.
    Proposed Sec.  618.770 is new. It implements the Department's role 
in administering the HCTC, created by the Reform Act. Proposed 
paragraph (a) references some of the substance in section 35 of the 
Internal Revenue Code (26 U.S.C. 35), which authorizes the HCTC. 
Proposed paragraph (a) is informational, since the IRS determines HCTC 
eligibility. Proposed paragraph (b) describes the duties of the CSA in 
administering the HCTC.

[[Page 50791]]

Subpart H--Administration By Applicable State Agencies
    This proposed subpart is modeled after subpart G of 20 CFR Part 
617. However, sections in this proposed subpart H are organized 
differently than their companion sections in 20 CFR Part 617, and have 
been revised to reflect changes made by the Reform Act. Also, some new 
sections have been added. This proposed subpart covers the 
administrative procedures that the CSA will follow in delivering TAA 
program benefits and services to adversely affected workers. Major 
changes include:
    <bullet> Clarifies that, in order to better integrate service 
delivery with all workforce investment programs, and provide 
flexibility to the states, merit staffing is not required, except that 
these merit system standards do apply to employees of the state UI or 
employment service (ES) agency who perform functions under both the TAA 
program and the UI and/or ES programs.
    <bullet> Clarifies the need for the CSA to submit, upon request, a 
copy of each waiver of the training requirement, and a statement of the 
reasons for such waiver.
    <bullet> Clarifies actions the Department may take in the absence 
of a jointly-signed Governor-Secretary Agreement for a particular 
state.
    <bullet> Directs the CSA to provide information on ATAA benefits 
and deadlines to a worker, and inform the worker that a choice must be 
made between TAA and ATAA benefits and services, if the worker is 
covered under both a TAA and an ATAA certification.
    <bullet> Requires the state to provide information about the HCTC 
and second COBRA election period available to affected workers to 
increase their opportunities to access the HCTC.
    <bullet> Provides that ATAA will be treated in the same manner as 
TRA for recovering overpayments.
    <bullet> Directs CSAs to submit, only upon request, a copy of any 
administrative or judicial ruling on an individual's eligibility to TAA 
or ATAA. Previously, states were required to submit a copy of every 
administrative or judicial ruling.
    <bullet> Adds a new section, which establishes ``priority of 
service'' requirements for the TAA program consistent with the Jobs for 
Veterans Act of 2002. This gives the highest priority for approval and 
funding of TAA benefits to an adversely affected worker meeting the 
veterans' priority of service.
    <bullet> Provides that the Department may reduce the training 
allocation or administrative funding of CSAs that fail to submit 
accurate and timely reports.
    <bullet> Informs CSAs of the need to report financial results on an 
accrual basis.
    <bullet> Requires CSAs to supply data to the Secretary on national 
TAA program performance goals identified in applicable regulations, the 
Department's written advisories, or any other written means used to 
communicate such goals.
    <bullet> To ensure a complete and accurate accounting of program 
performance, directs the use of quarterly wage record information, the 
Wage Record Interchange System, and supplemental data, when 
appropriate.
    Proposed Sec.  618.800 sets out the scope for subpart H; that it 
covers administrative procedures governing the TAA program.
    Proposed Sec.  618.805 addresses the Agreements between the States 
and the Secretary of Labor that are required under section 239 of the 
Act before a State may deliver TAA to adversely affected workers. It 
follows Sec.  617.59 but reorders the provisions and edits them for 
clarity. Proposed Sec.  618.805 omits two provisions in 20 CFR 617.59 
that the Department believes are obsolete and also adds a new provision 
not contained in 20 CFR 617.59.
    Proposed paragraph (b), which provides the requirements for 
executing an Agreement, is significantly rephrased but remains 
substantively unchanged from 20 CFR 617.59(b). The one difference is 
that proposed paragraph (b) includes language more explicitly requiring 
the Secretary, in addition to the State, to sign and date the Agreement 
as a prerequisite to the Agreement taking effect. Proposed paragraph 
(b) recognizes the current practice of executing Agreements. A new 
sentence indicating the consequences of not entering an Agreement has 
been added to proposed paragraph (b) to serve as a reminder.
    Proposed paragraph (d) is a new provision that clarifies the 
applicability of State merit systems to the TAA program. The Department 
has received inquiries in recent years about the applicability of the 
merit system standards, promulgated by the U.S. Office of Personnel 
Management in 5 CFR 900.603, to the TAA program. These standards apply 
to the States' administration of, among other things, the UI program as 
a condition of the States receiving administrative grants. TAA has no 
legislative requirement to use State merit system employees, nor do the 
programs authorized under the Workforce Investment Act. The Reform Act 
requires the Secretary to secure for adversely affected workers the 
services provided through the One-Stop delivery system. To avoid 
imposing new merit staffing requirements on the One-Stop partner 
programs, including those funded by WIA, proposed paragraph (d) 
provides that the merit system standards in 5 CFR 900.603 do not apply 
to the TAA program, except that these merit system standards do apply 
to employees who perform functions under both the TAA program and other 
programs covered by the merit standards.
    Proposed paragraph (e) is a new provision which identifies required 
provisions in each Agreement while also clarifying that it is not an 
exhaustive list. Proposed paragraph (e)(1) requires Agreements to 
contain provisions consistent with the requirements of section 239 of 
the Act. It is designed to remind States of, and insure compliance 
with, the requirements of section 239 of the Act. Proposed paragraph 
(e)(2) reflects the provisions of section 231(c)(2) of the Act by 
requiring Agreements to contain provisions authorizing the CSA to issue 
waivers of the training requirement under proposed Sec.  618.725, and 
requiring the CSA to submit, to the Secretary, upon request, a copy of 
each waiver and, if not already contained within each waiver, a 
statement of the reasons for such waiver. Proposed paragraph (e)(3) 
provides that Agreements must contain the requirement that CSAs supply 
data to the Secretary on national TAA program performance goals 
identified in applicable regulations, the Department's written 
directives, or any other written means used to communicate such goals. 
This is a new requirement designed to implement guidance from the 
Office of Management and Budget (OMB) on the Government Performance 
Results Act of 1993 (GPRA). GPRA requires, among other things, that 
Federal agencies take steps to improve the performance outcomes of 
federally funded programs. Toward this end, proposed Sec.  618.880 
requires States to report specified data on TAA performance outcomes to 
the Department. The Department believes that including a specific 
provision in the Agreements requiring reporting of performance data 
would emphasize to States the importance of pursuing improved 
performance outcomes in the TAA program.
    Proposed paragraph (g) provides that ETA Regional Administrators 
are responsible for monitoring and reviewing State and CSA compliance 
with the Agreement. It is slightly rephrased from 20 CFR 617.59(g), 
deleting ``initially'' from language in 20 CFR 617.59(g) that stated 
ETA Regional Administrators are ``initially'' responsible for 
monitoring and reviewing State and CSA compliance, and omitting 
language in 20 CFR

[[Page 50792]]

617.59(g) that provides for ``periodic'' monitoring and review by ETA 
Regional Administrators. The word ``initially'' is a confusing and 
unnecessary qualification to the central role that ETA Regional 
Administrators assume in overseeing the States' administration of the 
TAA program. The word ``periodic'' is omitted because Departmental 
review is an ongoing process.
    Proposed paragraph (h) is modified from 20 CFR 617.59(f). Proposed 
paragraph (h) retains the substance of 20 CFR 617.59(f) but also 
provides that the Secretary may, upon finding a State has not fulfilled 
its commitments under its Agreement, ``disallow costs or impose such 
other sanctions as may be appropriate.'' The Department believes it is 
important to explicitly provide for lesser sanctions that might be more 
effective in encouraging compliance with the terms of the Agreements 
than only the more severe sanction of terminating the Agreement.
    Finally, proposed Sec.  618.805 omits two provisions of 20 CFR 
617.59 that the Department believes are obsolete. The first of these 
provisions is 20 CFR 617.59(d), which provides that a State or State 
agency must execute an amended Agreement with the Secretary before 
administering any amendments to the Act. The Department believes this 
provision to be unnecessary and counterproductive. The Act contains no 
such requirement, and it would be more efficient and beneficial to all 
interested parties to allow States, which have already agreed to 
administer the TAA program in accordance with the law and the 
Department's instructions, to administer amendments to the Act before 
the execution of an amended Agreement. However, the omission of this 
provision from proposed Part 618 should not be construed as removing 
the Department's authority to require execution of an amended Agreement 
after amendments to the Act are enacted.
    The second provision is 20 CFR 617.59(h), which requires 
coordination among State agencies administering programs under subpart 
C of 20 CFR Part 617, entities administrating the Job Training 
Partnership Act (JTPA), and State UI agencies. JTPA has been superseded 
by the Workforce Investment Act of 1998 (WIA), and, reflecting the 
Reform Act's increased emphasis on program coordination, the Department 
proposes a new set of coordination requirements in proposed subpart C 
that need not be repeated in proposed Sec.  618.805.
    Proposed Sec.  618.810, providing the requirements governing State 
agency rulemaking concerning State TAA administration, is slightly 
rephrased but contains only two substantive differences from 20 CFR 
617.54. The first difference is that while the current regulation 
permits the Department's temporary approval of a State supplemental 
procedure to remain in effect for not longer than 90 days, proposed 
Sec.  618.810 provides that such temporary approval may remain in 
effect ``not to exceed a period determined by the Secretary on a case-
by-case basis.'' The 90-day maximum in the current regulation is 
unnecessarily restrictive and all interested parties would be better 
served if the periods for temporary approvals are decided on a case-by-
case basis, depending on the importance of the provision to state 
operations and the length of the review process. The second difference 
from 20 CFR 617.54 is that, while 20 CFR 617.54 requires a CSA to 
follow State UI law requirements for public notice and opportunity for 
hearing, proposed Sec.  618.810 more broadly requires the State to 
follow also any other State or Federal law that may require such public 
notice and opportunity for hearing. This change accommodates the 
possibility that other laws that require public participation in 
changes to State plans or procedures, such as WIA, could apply.
    Proposed Sec.  618.815, authorizing CSAs to issue and enforce 
subpoenas for various purposes specified in that provision, is 
substantially the same as 20 CFR 617.53, with one modification. 
Proposed Sec.  618.815 identifies the purposes for which subpoenas to 
require attendance of witnesses and production of records may be 
issued: for making benefit determinations and assisting in the petition 
determination process.
    Proposed Sec.  618.820 contains requirements the States must meet 
in providing TAA program and benefit information to workers. It is 
significantly modified from 20 CFR 617.4 and has been placed in 
proposed subpart H on State administration where it more logically 
fits. Proposed Sec.  618.820 omits some provisions in 20 CFR 617.4 that 
the Department believes are unnecessary. It updates some provisions and 
adds a few provisions to reflect Reform Act amendments to the Act. It 
also includes other changes that have occurred since Part 617 became 
effective, and some of the requirements typically contained in the 
Agreements with the States.
    Proposed paragraph (a), requiring CSAs to provide general program 
information and advice to workers, serves the same purpose as 20 CFR 
617.4(a) but is more condensed.
    Proposed paragraph (b) is a new provision mandated by the Reform 
Act which requires CSAs to provide rapid response assistance and 
appropriate core and intensive services, consistent with section 134 of 
WIA, to workers covered under a TAA petition.
    Proposed paragraph (c) implements section 235 of the Act and 
requires CSAs to provide specified reemployment services to adversely 
affected workers. This is a new provision.
    Proposed paragraph (d) requires CSAs to provide assistance to 
complete and file TAA petitions. It combines requirements contained in 
20 CFR 617.4(b) and 20 CFR 617.4(e)(2), simplifies the language of 
those provisions, and adds the authorization, provided by the Reform 
Act, for CSAs to file petitions on behalf of worker groups.
    Proposed paragraph (e) requires CSAs to provide certain information 
and assistance to adversely affected workers after a certification 
covering their worker group is issued. The provisions in proposed 
paragraph (e) are substantively identical to 20 CFR 617.4, but they 
have been rephrased and slightly reorganized for clarity and 
simplicity. Proposed paragraph (e)(2) mirrors 20 CFR 617.4(d)(1) but 
has some minor changes. The first change is that proposed paragraph 
(e)(2) adds a sentence encouraging CSAs to provide notice of benefits 
during the rapid response process to workers who are covered by a 
certification and who have received a notice of separation, consistent 
with the Reform Act's requirement that rapid response assistance be 
provided. The second change is to add to the information that must be 
included in the written notice mailed to each worker covered by a 
certification information regarding the training enrollment deadlines 
that are a condition of TRA eligibility.
    Proposed paragraph (f) requires CSAs to provide specific benefit 
assistance to workers. Proposed paragraph (f)(1) is modeled on 20 CFR 
617.4(e)(1) but is rephrased for clarity. One minor change from 20 CFR 
617.4(e)(1) is that proposed paragraph (f)(1) omits the reference to UI 
claimants because it might be confusing. The Department interprets 
section 225(b)(1) of the Act to require that the CSA provide notice to 
each worker that it can reasonably identify as being covered by a 
certification whether or not that worker has applied for UI.
    Proposed paragraph (f)(2) combines the requirements of 20 CFR 
617.4(e)(3) and 20 CFR 617.4(e)(4) into a single paragraph because they 
are closely related. The language has been changed

[[Page 50793]]

to emphasize the need to timely provide the advice and reemployment 
services adversely affected workers need to make the decisions about 
employment or training necessary to preserve eligibility for TAA 
benefits. Language has been added to recognize that a worker may 
decline to be interviewed.
    Proposed paragraphs (f)(3) and (f)(4) are new provisions that 
require CSAs to provide information on ATAA benefits and deadlines and 
on HCTC and the second COBRA election.
    Proposed Sec.  618.825 contains Federal procedural requirements 
that apply to State benefit determination and redetermination 
processes. It contains four minor differences from 20 CFR 617.50, only 
two of which are noteworthy. The first is in proposed paragraph (d), 
which excludes an exception contained in 20 CFR 617.50(d) that the 
State law and regulations do not apply where they are inconsistent with 
the letter or purpose of 20 CFR part 617. This exception is unnecessary 
because this paragraph applies only to matters that by the terms of 
Federal law are committed to be decided under State law. The second 
difference is in proposed paragraph (g), which omits an exception in 20 
CFR 617.50(g) that the specified provisions of the Employment Security 
Manual do not apply where part 617 requires otherwise. This exception 
is unnecessary because it is axiomatic that where there is a conflict 
between the Act or the implementing regulations and the Employment 
Security Manual, the Act or implementing regulations govern.
    Proposed Sec.  618.830, concerning the respective responsibilities 
of a liable State and an agent State, repeats the requirements in 20 
CFR 617.26 but updates the requirements to reflect changes made by the 
Reform Act, and also reorganizes the requirements. Proposed paragraph 
(a)(6) requires a liable State to provide lists of eligible TRA 
recipients and eligible ATAA recipients to the IRS consistent with the 
requirements of proposed Sec.  618.770. These lists are necessary for 
the IRS to determine who is potentially eligible to receive the HCTC. 
Also, the specific reference in 20 CFR 617.26(a) that ``the liable 
State also is responsible for publishing newspaper notices'' alerting 
the public to certifications is omitted here as unnecessary because it 
is contained in proposed Sec.  618.820(e)(3).
    Proposed Sec.  618.835, providing requirements governing appeals 
and hearings of TAA determinations and redeterminations, repeats the 
requirements in 20 CFR 617.51, but slightly rephrases the language for 
clarity and also adds a new paragraph. This new paragraph, proposed 
paragraph (b), clarifies that, as an exception to the general rule 
concerning appeals in proposed paragraph (a), a complaint that a 
determination or redetermination under this part 618 violates 
applicable Federal nondiscrimination laws administered by the U.S. 
Department of Labor must be filed in accordance with the procedures of 
29 CFR parts 31, 32, 35, 36, and/or 37, as provided in proposed Sec.  
618.875(i) (Nondiscrimination and equal opportunity requirements). This 
clarification would help insure that proper procedures are followed 
where a claimant alleges discrimination.
    Proposed Sec.  618.840, concerning overpayments, fraud, and 
penalties for fraud, generally repeats 20 CFR 617.55, but reorganizes 
the section outline to make it easier to follow. Proposed Sec.  618.840 
slightly rephrases some of the provisions in 20 CFR 617.55 and also 
contains a few substantive differences from 20 CFR 617.55. Also, 
proposed Sec.  618.840 omits provisions in 20 CFR 617.55(h) on using 
TAA to offset other debts because, reflecting the importance the 
Department places upon these provisions, proposed subpart H devotes a 
separate proposed section to them, Sec.  618.845.
    Proposed paragraph (a) repeats the requirements in 20 CFR 
617.55(a), except that the language on the overpayment waiver criteria 
has been moved into separate paragraphs for clarity.
    Proposed paragraph (b), concerning the State election to permit 
waivers of overpayment recoveries, repeats the requirements in 20 CFR 
617.55(a)(2)(ii)(C)(4) and places this provision toward the beginning 
of proposed Sec.  618.840 because it logically precedes other 
provisions in this proposed section. A sentence has been added to 
clarify that if a CSA elects the option of waiving overpayments, 
waivers must follow the rules in Sec.  618.840, and the CSA must 
document that its waiver rules do so. Proposed paragraph (c) repeats 
the requirements of 20 CFR 617.55(a)(2)(ii)(C)(3) but modifies them 
slightly by specifying that the waiver request must be made to the CSA. 
Proposed paragraph (d) repeats the requirements in 20 CFR 
617.55(a)(1)(i)-(ii).
    Proposed paragraph (e) contains more specific waiver criteria that 
interpret the general criteria in proposed paragraphs (d)(1) and 
(d)(2).
    Proposed paragraphs (e)(1) and (e)(2) provide the criteria to 
determine whether an overpayment was made without fault of the person 
or individual who received the overpayment. Proposed paragraph (e)(1) 
repeats the requirements in 20 CFR 617.55(a)(2)(i)(A)(1)-(5), with one 
exception. It changes the standard for determining whether fault exists 
from ``knew or could have been expected to know'' to ``knew or should 
have known.'' The Department believes this test is easier to administer 
because it is a common standard that administrative and judicial 
adjudicators apply routinely.
    Proposed paragraphs (e)(3) and (e)(4) repeat the requirements in 20 
CFR 617.55(a)(2)(ii)(A)(1) and 20 CFR 617.55(a)(2)(ii)(B). However, 
proposed paragraph (e)(3)(ii) rephrases the language of the current 
regulation to make it easier to understand.
    Proposed paragraphs (e)(5)(i) and (e)(5)(ii) repeat the 
requirements in 20 CFR 617.55(a)(2)(ii)(C)(1) and (a)(2)(ii)(C)(2), 
with two modifications. The first modification is that the explanation 
of what is a ``lasting financial hardship'' in proposed paragraph 
(e)(5)(i) omits the requirement that the hardship must also be 
``extraordinary'' to make it clear that these are two separate tests. 
The second modification is that where 20 CFR 617.55(a)(2)(ii)(C)(2) 
refers to a person's or individual's ``firm'' or ``organization,'' 
proposed paragraph (e) refers to the person's or individual's ``wholly 
or family-owned business'' and omits the term ``organization.'' This 
wording more clearly focuses attention on the debtor's assets.
    Proposed paragraph (f) repeats the requirements about 
determinations of fraud in 20 CFR 617.55(b) but makes one modification, 
adding that a person or individual found guilty of fraud in a TAA claim 
is ``forever more'' ineligible for any further TAA payments. The 
Department believes that this ``lifetime'' ban is the better 
interpretation of section 243(b) of the Act, which it implements.
    Proposed paragraph (g) retains the requirements in 20 CFR 617.55(c) 
about the consequences of failing to complete training, a job search, 
or a relocation funded by the TAA program, but is rewritten for 
clarity.
    Proposed paragraph (h) repeats the requirements in 20 CFR 
617.55(d), slightly rephrased for clarity.
    Proposed paragraph (i) repeats the requirements in 20 CFR 
617.55(a)(2)(ii)(C)(5), with changes concerning recovering an 
overpayment from the affected person's or individual's State UI 
entitlement and with some added provisions. The current regulation 
permits, but does not require, recovery from State UI payments. 
Proposed paragraph (i)(2) requires overpayment recovery from

[[Page 50794]]

State UI in a State that has in effect a cross-program offset Agreement 
with the Secretary under authority of 42 U.S.C. 503(g)(2), subject to 
the limitation on the amount that may be recovered from any single 
payment in proposed paragraph (i)(4). The current regulations predated 
the cross-program offset Agreements and, therefore, contain no 
provision for them. Proposed paragraph (i)(3) provides that, in States 
that do not have a cross-program offset Agreement, overpayment recovery 
from State UI is permitted but not required, and also is subject to the 
limitation in proposed paragraph (i)(4). Proposed paragraph (i)(4) 
limits recoveries from all types of UI described in proposed paragraph 
(i) to no more than 50 percent of each of the affected person's or 
individual's State UI payments. This limitation would implement the 
limitation in section 243(a)(2) of the Act. However, since the Act sets 
the 50-percent deduction as a ceiling, proposed paragraph (i)(4) 
requires each State to follow its own law if its law provides for a 
greater limitation.
    Proposed paragraphs (j) and (k) repeat the requirement of 20 CFR 
617.55(e) and (f).
    Proposed paragraph (l) repeats the requirements of 20 CFR 617.55(g) 
but makes one change. It changes the requirement that State procedures 
for detection and prevention of fraudulent TAA overpayments be 
``commensurate with'' those for State UI to a requirement that State 
procedures to be ``no less rigorous than'' those for State UI. The 
Department believes this change provides a clearer standard.
    Proposed paragraph (m) follows 20 CFR 617.55(i) in explaining who 
is a ``person'' for purposes of proposed Sec. Sec.  618.840 and 
618.845, except for two modifications. The modifications are that 
proposed paragraph (m) explicitly includes ``any training institution 
as well as the officers and officials thereof,'' and ``an adversely 
affected worker or other individual.''
    Proposed Sec.  618.845 governs the use of TAA benefits to offset 
debts that a benefit recipient owes to others. Proposed paragraph (a) 
largely follows 20 CFR 617.55(h)(1) but rephrases it for clarity and 
adds ATAA. The authority for this requirement is the Debt Collection 
Act of 1982 (Pub. L. 97-365) and its implementing regulations in 29 CFR 
Part 20.
    Proposed paragraph (b) makes a significant change in 20 CFR 
617.55(h)(2). The current regulation prohibits using TAA to pay debts 
owed to any State or other person or entity but permits offset only for 
debts owed for child support and alimony required to be collected under 
State and Federal law. Proposed paragraph (b) limits the general 
prohibition to allow TAA and ATAA to be applied to any debt that may be 
collected under the State law for UI. The Department proposes this 
change because the exception in the current regulation goes beyond 
Federal law and because, since State laws must follow the Social 
Security Act (SSA), there is no good reason to single out one instance 
in which the SSA requires or permits collection of debts but to ignore 
others.
    Most particularly, SSA section 303(e)(2) requires a State to deduct 
``child support obligations'' from ``any unemployment compensation 
otherwise payable to an individual.'' Under SSA section 303(e)(2)(B), 
this deduction is applicable to TRA. However, SSA section 303(e)(1) 
defines ``child support obligations'' as ``only includ[ing] obligations 
which are being enforced pursuant to a plan described in section 454 of 
this Act which has been approved by the Secretary of Health and Human 
Services under Part B of title IV of this Act.'' It therefore does not 
permit deductions for alimony or for child support in general, as 
provided by 20 CFR 617.55(h)(2), but only for child support obligations 
of the type specified. Unemployment Insurance Program Letter No. 45-89 
(55 FR 1886 (1990)) explained in detail the deductions permitted under 
SSA section 303(e)(2).
    Other SSA provisions permit deductions from State UI for other 
purposes. These SSA provisions, like section 303(e)(2), apply to TRA. 
For example, section 303(d)(2)(A), SSA, permits offset of UI to recover 
uncollected over-issuances of food stamps under section 
303(e)(2)(B)(iii). The Department believes that all TAA and ATAA, which 
are closely connected to TRA, should follow the same rules for the 
offset of benefits as State UI law, except as provided under proposed 
paragraph (a).
    Proposed Sec.  618.850, on uniform interpretation and application 
of the Act and these proposed regulations, repeats the requirements in 
20 CFR 617.52, but with some reorganization and a few substantive 
changes. A change throughout proposed Sec.  618.850 is that these 
provisions apply explicitly to both TAA and ATAA.
    Proposed paragraphs (a) and (b) repeat the requirements in 20 CFR 
617.52(a) and (b).
    Proposed paragraph (c)(1) modifies the requirements in 20 CFR 
617.52(c)(1) that States to forward to the Department a copy of each 
administrative and judicial TAA decision within 10 days after the 
decision's issuance to a requirement to forward to the Department a 
copy of any TAA determination or redetermination only upon the 
Department's request. Proposed paragraph (c)(1) also applies the 
requirement to all administrative and judicial decisions. The 
Department believes the current requirement is unduly burdensome and 
that the purpose of this provision, oversight of State benefit rulings, 
can be accomplished effectively with this less burdensome requirement.
    Proposed paragraph (c)(2) combines the requirements in 20 CFR 
617.52(c)(2), (3) and (5) and makes some changes. Proposed paragraph 
(c)(2) rewrites and simplifies the provisions in 20 CFR 617.52(c)(2) 
and (c)(3), eliminating the distinction between ``ordinary'' and 
``patent and flagrant'' interpretations. Since the procedures 
applicable to both types of determination are the same, the Department 
sees no need to retain the distinction. Proposed paragraph (c)(2)(ii) 
also eliminates any ambiguity in 20 CFR 617.52(c)(3), concerning the 
conditions under which payments otherwise ``due'' within the meaning of 
SSA section 303(a)(1) may be temporarily delayed in the case of a 
determination, redetermination, or decision awarding TAA that is 
inconsistent with the Department's interpretation of the Act or the 
regulations. Section 617.52(c)(3) uses the phrase ``redetermination or 
appeal action is taken.'' This language leaves unclear what is the 
``redetermination action'' that must be taken and how that action 
differs from the actual redetermination. Proposed paragraph (c)(2)(ii) 
resolves this ambiguity by requiring that the redetermination be 
issued.
    Proposed paragraph (c)(2)(iii) repeats the requirements of 20 CFR 
617.52(c)(5), with three substantive changes: that the request for 
reconsideration must be in writing; that the request must be made 
within 10 calendar days of receiving the notice; and that the Secretary 
will respond to the request within 30 calendar days. These changes will 
make for a more orderly and predictable process.
    Proposed paragraph (c)(3) repeats the requirements in 20 CFR 
617.52(c)(4) but slightly rephrases them for clarity. Proposed 
paragraph (c)(4) repeats the requirement in 20 CFR 617.52(c)(6).
    Proposed Sec.  618.855 repeats the requirements in 20 CFR 617.56 
concerning inviolate rights to TAA almost verbatim but extends it to 
include ATAA.
    Proposed Sec.  618.860, a new section, establishes ``priority of 
service''

[[Page 50795]]

requirements for the TAA program consistent with the Jobs for Veterans 
Act of 2002. Under that Act, armed forces veterans and specified 
categories of spouses of such veterans are entitled to a ``priority of 
service'' in Department of Labor-funded workforce development programs. 
This proposed section requires CSAs to give ``the highest priority'' 
for approval and funding of TAA to an adversely affected worker meeting 
the veterans' priority of service. In particular, this priority would 
come into play if the TAA program is approaching its annual national 
cap on training funds. In that case, each CSA must give priority to 
veterans and to the specified categories of spouses, over other 
adversely affected workers' training applications, in approving and 
funding training. Of course, when a CSA is about to run out of its 
allotted training funds, it may request supplemental training funds to 
ensure that all adversely affected workers' training needs are met. 
There is no annual national cap on payments of other TAA benefits, and 
a CSA about to run out of its allotted funds for such other benefits 
may request supplemental funding for such benefits; however, it is 
possible that the funds appropriated for other TAA services could be 
exhausted, in which case the priority of service would apply to TAA 
program benefits beyond training.
    Proposed Sec.  618.865 repeats the requirements in 20 CFR 617.57 
concerning recordkeeping and disclosure of information but makes a few 
minor changes.
    Proposed paragraph (a) is very similar to 20 CFR 617.57(a), with 
two changes. First, proposed paragraph (a) omits reference to reporting 
form ETA 563. This omission does not mean that reporting on this form 
is no longer required. Rather, required reporting would be governed by 
proposed Sec.  618.870. Second, proposed paragraph (a) adds that CSAs 
are required to maintain records that contain any information that the 
Department determines to be appropriate in support of any reports that 
the Department may require, including the reports specified in proposed 
Sec. Sec.  618.875(j) and 618.880(e). This new language would 
facilitate initiatives on improving TAA program performance and 
outcomes.
    Proposed paragraph (b) modifies the requirements in 20 CFR 
617.57(b). The opening sentence requires States to keep information on 
TAA applicants confidential to the extent required under all State and 
Federal laws. This is a change from the first sentence in 20 CFR 
617.57(b), which requires information in records kept by a State in its 
administration of the Act to be kept confidential and to be disclosed 
only in the same manner and to the same extent as State UI information 
may be disclosed under State law.
    Proposed paragraph (b) omits the second sentence of 20 CFR 
617.57(b) and substitutes a new second sentence that explicitly 
identifies confidential business information, as defined in proposed 
Sec.  618.110, as a type of information that States must keep 
confidential. The requirements in the first two sentences of 20 CFR 
617.57(b) are appropriate for 20 CFR Part 617 because it governs only 
individual benefits administration and not the petition determination 
process, which can bring the State into possession of confidential 
business information obtained when determining whether to issue a 
certification. State UI law confidentiality and disclosure requirements 
may not apply to confidential business information and also may not 
consider other Federal law confidentiality requirements that could 
apply to that information. Because proposed Part 618, governs both the 
petition determination process and individual benefits administration, 
it is necessary that proposed paragraph (b) contain these more broadly 
applicable requirements. Also, the language in proposed paragraph (b) 
is more consistent with the language in the Agreements with the States, 
which more broadly encompasses any State and Federal confidentiality 
and disclosure requirements that might apply to TAA information.
    Proposed Sec.  618.870 expands on the one-sentence requirement in 
20 CFR 617.61 requiring CSAs to submit such information and reports and 
conduct such studies as the Secretary requires for TAA purposes.
    Proposed paragraph (a) repeats the requirement in 20 CFR 617.61 and 
adds that CSAs must submit financial and non-financial reports on 
activities conducted with TAA program funds to the Department in 
accordance with reporting instructions on such reports' content, 
frequency, and due dates approved by the Office of Management and 
Budget. The Department proposes adding this requirement to facilitate 
initiatives on improving TAA program performance and outcomes.
    Proposed paragraph (b), a new provision, provides that the 
Department may reduce the funding of CSAs that fail to submit accurate 
and timely reports or whose reports cannot be validated or verified as 
accurately counting and reporting activities. This provision reflects 
the importance the Department places on the submission of timely and 
accurate reports and provides an additional incentive for CSAs to 
comply with reporting requirements.
    Proposed Sec.  618.875, a new section, contains general fiscal and 
administrative requirements applicable to CSA' administration of the 
TAA program. It is modeled on the WIA regulations at 20 CFR 667.200, 
but with significant differences. Proposed Sec.  618.875 contains no 
requirements that States are not already required to meet. Its 
requirements are those also found in Federal regulations in 29 CFR and 
48 CFR, various Office of Management and Budget (OMB) Circulars that 
govern uses of Federal funds by recipients of such funds, and the 
Department's interpretations of those regulations and Circulars. The 
Department believes including this section in subpart H to highlight 
these requirements would result in improved compliance by CSAs and 
other entities receiving TAA funds.
    Proposed paragraph (a) is roughly modeled on the WIA regulation in 
20 CFR 667.200(a) but contains significant differences because it is 
written for TAA purposes.
    Proposed paragraph (a)(3) provides that the period of expenditure 
for TAA funds granted for employment services, training, and job search 
and relocation allowances is three years. This provision follows 
section 245(b) of the Act, as amended by the Reform Act.
    Proposed paragraph (a)(4) provides that equipment, as described in 
Attachment B of ``Cost Principles for State, Local and Indian Tribal 
Governments,'' codified at 2 CFR Part 225, and in 29 CFR 97.32, 
includes equipment acquired with TAA administrative funds under both 
current and prior Agreements.
    29 CFR 97.32, includes equipment acquired with TAA administrative 
funds under both current and prior TAA Annual Cooperative Financial 
Agreements. This provision, which only clarifies existing Federal law 
requirements, responds specifically to two situations observed in the 
States. First, in the case of a CSA's internal reorganization, any 
equipment purchased in prior years with TAA funds remains the CSA's 
property and must continue to be used for the TAA program. Second, this 
provision makes clear that a CSA may charge other non-TAA State 
agencies for using equipment purchased originally with TAA funds in 
previous years.
    Proposed paragraph (a)(5), mirrors the requirement in the WIA 
regulation at 20 CFR 667.200(a)(5), that TAA grant recipients apply the 
addition method to all program income earned under TAA

[[Page 50796]]

grants. Proposed paragraph (a)(5) codifies the Department's view that 
the addition method always should be used in TAA administration.
    Proposed paragraph (b) governs allowable costs and cost principles, 
mirroring the requirements in the WIA regulation in 20 CFR 667.200(c). 
Proposed paragraph (b)(7) provides that all types of organizations must 
abide by the limitation on administrative costs for training and job 
search and relocation allowances contained in the TAA Annual 
Cooperative Financial Agreement.
    Proposed paragraphs (c) through (e) provide specific cost 
principles applicable to TAA grants. Proposed paragraphs (c) and (d) 
mirror the requirements in the WIA regulations at 20 CFR 667.200(c)(6) 
and (e). Proposed paragraph (e) provides that, as an exception to 2 CFR 
part 225 (codifying OMB Circular No. A-87 (Revised)), the costs of 
certain State employee fringe benefit plans may be charged to TAA grant 
funds if certain conditions are met. This preserves the benefit rights 
of State UC and ES agency employees who perform functions in the TAA 
program.
    Proposed paragraph (f) waives, with one specified exception, the 
requirement in 2 CFR part 225 that TAA grant recipients obtain the 
Department's approval before purchasing equipment, as defined in 29 CFR 
97.3, using TAA grant funds. Prior Department approval still is 
required for real estate purchases. The Department also reserves the 
right to require the transfer of automatic data processing equipment in 
accordance with applicable regulations.
    Proposed paragraphs (g) and (h) are self-explanatory.
    Proposed paragraph (i) contains nondiscrimination and equal 
opportunity requirements, drawn from 29 CFR Part 37. It is modeled on 
the nondiscrimination and equal opportunity provisions at 20 CFR 
641.827 in the Department's regulations implementing the Senior 
Community Service Employment Program, but is revised to make it 
appropriate for the TAA program.
    Proposed paragraph (i)(1) notifies CSAs and subrecipients of 
financial assistance under the TAA program that, as recipients of 
Federal financial assistance, they are subject to the requirements of 
specified Parts of 29 CFR, setting forth prohibitions relating to 
discrimination.
    Proposed paragraph (i)(2) notifies CSAs and subrecipients of 
financial assistance under the TAA program of the circumstances under 
which they may be subject to 29 CFR Part 37, which implements the 
nondiscrimination provisions in section 188 of WIA. It states that the 
WIA nondiscrimination regulations apply to CSAs and subrecipients that 
operate their TAA programs and activities ``as part of the One-Stop 
delivery system,'' as provided in 29 CFR 37.2(a)(2). Since CSAs and 
entities that carry out ``activities authorized under chapter 2 of 
title II of the Trade Act of 1974'' (29 U.S.C. 2841(b)(1)(B)(viii)) are 
required One-Stop partners, the WIA nondiscrimination regulations apply 
to them. Coverage under this provision is not limited to CSAs or 
subrecipients that co-locate their operations in a One-Stop Center. 
Proposed paragraph (i)(2)(ii) notifies CSAs and subrecipients that 
there may be additional circumstances under which they are subject to 
29 CFR Part 37 if they in any other way meet the definition of 
``recipient'' in 29 CFR 37.4.
    Proposed paragraph (i)(3) directs those with questions about the 
cited nondiscrimination provisions to DOL's Civil Rights Center. It 
also explains where persons who believe that those nondiscrimination 
regulations have been violated may file complaints.
    Proposed paragraph (i)(4) explains how the cited nondiscrimination 
provisions affect the applicability of any other Federal 
nondiscrimination laws, or any relevant State or local laws, to TAA 
programs and activities. Proposed paragraph (i)(4)(i) provides that 
proposed Sec.  618.875(i) does not, and is not intended to, affect any 
rights regarding, or protections against, discrimination provided by 
such laws, except as provided in proposed paragraphs (4)(ii) and (iii).
    Proposed paragraph (i)(4)(ii) makes clear that the provisions of 
DOL's regulations implementing certain Federal statutes requiring 
nondiscrimination take precedence over any State or local law or other 
requirement that permits, or requires, discrimination on the bases 
protected by those Federal regulations. Proposed paragraph (i)(4)(iii) 
provides that 29 CFR Part 37 takes precedence over any State or local 
law or other requirement that permits or requires discrimination 
against beneficiaries of the TAA program on the basis of participation 
in a program or activity that is financially assisted under title I of 
WIA or on the basis of citizenship or status as a non-citizen lawfully 
admitted to work in the United States.
    Proposed paragraph (j) contains fiscal reporting requirements for 
CSAs. Like other DOL workforce development programs, CSAs are required 
to report financial results on an accrual basis.
    Proposed Sec.  618.880 is a new section which contains TAA program 
performance requirements. As mentioned in the discussion of proposed 
Sec.  618.805, proposed Sec.  618.880 implements OMB guidance on GPRA. 
Toward this end, proposed Sec.  618.880(a) requires States to report 
specified data on TAA performance outcomes to the Department.
    Proposed paragraph (b) requires States to report TAA program data 
necessary to calculate performance in three specified categories and 
also includes a provision authorizing the Department to establish 
additional categories. The three specified categories are taken from 
the ``common measures'' through which the Federal Government measures 
the performance of a variety of workforce development programs. The 
Department has adopted the common measures and will apply them to all 
Department-funded workforce development programs.
    Proposed paragraph (c)(1) identifies, in general terms, the 
performance measures States must use in reporting performance under 
each category identified in proposed paragraph (b). It also authorizes 
the Department to establish additional measures. Proposed paragraph 
(c)(2) provides that the Department will identify certain timeframes, 
definitions, and units of cost in future administrative issuances to 
provide more detailed reporting guidance. The Department believes that 
flexibility is required in setting the details of performance 
reporting, which is best provided in administrative issuances.
    Proposed paragraph (d) requires CSAs, consistent with State law, to 
use quarterly wage record information, as defined in the WIA regulation 
at 20 CFR 666.150(c), in measuring progress on the program performance 
measures. Specifically, it requires CSAs to use social security numbers 
if permitted by Federal law, and other identifying designations if 
Federal law prohibits such use of social security numbers, to measure 
the progress of TAA program participants using quarterly wage 
information. The Department believes current Federal law permits such 
use of social security numbers but recognizes that Congress in recent 
years has considered restricting the uses of social security numbers. 
Further, proposed paragraph (d) requires CSAs that participate in the 
Wage Record Interchange System (WRIS) to use WRIS to obtain pertinent 
wage information for individuals who obtain work outside the State in 
which they received services. Finally, proposed paragraph (d) permits 
CSAs to use supplemental

[[Page 50797]]

sources to obtain pertinent wage and employment data.
    Proposed paragraph (e) imposes performance reporting requirements 
on CSAs. The Department plans to initially require the use only of the 
Trade Act Participant Report that States already submit. However, 
proposed paragraph (e) recognizes that the Department in the future 
might require reports that supersede or supplement this report. 
Proposed paragraph (e) also requires that reports be verified or 
validated as accurate.
    Proposed paragraph (f) provides that State performance outcomes 
will be measured against national goals established by the Department. 
These evaluations of State performance compared to national goals would 
be used to plan actions to improve program performance. Proposed 
paragraph (f) also provides that the Department may negotiate and 
establish performance goals each fiscal year with each CSA.
    Finally, proposed paragraph (g) provides that the Department will 
annually publish the States' TAA program performance.
    Proposed Sec.  618.885 contains requirements related to the 
termination of the TAA program after it expires. This provision is very 
different from 20 CFR 617.64, because it reflects amendments to section 
285 of the Act made after the promulgation of 20 CFR 617.64, including 
those made by the Reform Act.
    Proposed paragraph (a) provides the general rule that TAA benefits 
may not be paid after the termination date in section 285 of the Act or 
as otherwise provided by law. Section 285(a)(1) of the Act currently 
provides a termination date of September 30, 2007. However, history 
demonstrates that this date can change, and the Act might be 
reorganized so that a termination date might not always be contained in 
section 285. Therefore, the Department proposes omitting a specific 
date in the regulation and also qualifying the reference to section 285 
to accommodate that possibility.
    Proposed paragraph (b) provides the one exception to the general 
rule that benefits may not be paid after the termination date: That TAA 
benefits must continue to be paid to adversely affected workers who are 
covered under TAA certifications issued before the termination date and 
who otherwise meet TAA benefit eligibility requirements.
    Proposed subpart H also excludes some provisions contained in 
subpart G of 20 CFR Part 617 which are based on expired laws. Also, 
proposed subpart H omits the provision in 20 CFR 617.58 that UI 
otherwise payable to an adversely affected worker must not be denied or 
reduced for any week because of the worker's entitlement for any TAA 
benefit. The Department believes other provisions in proposed Part 618 
effectuate the same result, obviating the need for such a provision in 
proposed subpart H.

Part 665--Statewide Workforce Investment Activities Under Title I of 
the Workforce Investment Act

    The amendments to the WIA regulations proposed to be codified at 20 
CFR Part 665 reflect the Reform Act requirements for coordination 
between the workforce investment system and the TAA program that 
proposed 20 CFR 618.320 also addresses. Proposed Sec.  665.330 revises 
the title of this section to read: ``Are Trade Adjustment Assistance 
(TAA) program requirements for rapid response assistance, under the 
Trade Act of 1974, as amended, also required activities?'' The revised 
title clearly identifies that this section applies to the TAA programs 
instead of the NAFTA-TAA program under the NAFTA Implementation Act 
(Pub. L. 103-182), which was repealed by the Reform Act. Accordingly, 
this revised section incorporates the requirement that section 
221(a)(2)(A) of the Act places on the States, through the Governors, to 
expand State rapid response assistance to cover workers who have filed, 
or on whose behalf has been filed, a petition for certification of 
eligibility to apply for TAA.
    Proposed Sec.  665.330 recognizes that the full range of rapid 
response activities required by Sec.  665.310 may not be appropriate 
for workers covered by a petition because of the size or the timing of 
the layoff, or because such assistance has been provided previously in 
response to a layoff. Under those circumstances, paragraphs (b) and (c) 
of proposed Sec.  665.330 permit States to make alternative 
arrangements to assist workers seeking TAA certification to obtain 
employment. Rapid response assistance by the States includes providing 
individuals covered by a petition with: the information specified at 
proposed Sec.  665.310(b) and proposed Sec. Sec.  618.310 and 618.820; 
and information about and access to appropriate core and intensive 
services, and training opportunities, income support, and potential 
HCTC assistance, if they have not otherwise been provided.

Part 671--National Emergency Grants for Dislocated Workers

    The proposed revisions to the WIA regulations codified at 20 CFR 
Part 671 reflect changes to the NEG program relating to the HCTC. 
Proposed Sec.  671.105 revises this section to reflect that the Reform 
Act amended WIA section 174 to permit grants to provide health 
insurance coverage assistance under WIA section 173(f) and (g) to 
adversely affected workers under the Trade Act.
    A new section, Sec.  671.115 ``Under what circumstances are NEG 
grants available to provide assistance under WIA section 173(f) and 
(g)?,'' is proposed to be added to Part 671. This new section would 
explain how NEG grants described in Sec.  671.105 may be used to pay 
for health insurance coverage and other assistance for administrative 
and start-up expenses related to enrolling TAA recipients, ATAA 
recipients and PBGC pension recipients in qualified health insurance, 
as provided under the Reform Act.

V. Administrative Requirements

Executive Order 12866

    This proposal to revise 20 CFR Part 617, add 20 CFR Part 618, and 
revise 20 CFR Part 663 and 20 CFR Part 671 is not an economically 
significant rule because it will not materially alter the budgetary 
impact of entitlements, grants, user fees, or loan programs, have an 
annual effect on the economy of $100 million or more, or adversely 
affect in a material way the economy, a sector of the economy, 
productivity, competition, jobs, the environment, public health or 
safety, or State, local, or tribal governments or communities. However, 
the proposal is a significant regulatory action under Executive Order 
12866, section 3(f), Regulatory Planning and Review, because it raises 
novel legal or policy issues arising out of legal mandates, the 
President's priorities, or the principles set forth in the Executive 
Order. Accordingly, this regulation has been submitted to the Office of 
Management and Budget (OMB) for review.

Paperwork Reduction Act

    This proposed rule contains requirements for States to submit to 
the Department, at the Department's request, copies of any judicial or 
administrative decisions relating to an individual's eligibility to TAA 
and the text of procedures or supplemental procedures enacted by the 
States to further effective administration of the TAA program (proposed 
Sec. Sec.  618.845 and 618.810, currently codified at 20 CFR 617.52 and 
617.54). These requirements were previously reviewed and approved for 
use by the Office of Management and Budget (OMB) under 20 CFR 601.2 and

[[Page 50798]]

Sec.  601.3 and assigned OMB control number 1205-0222 under the 
provisions of the Paperwork Reduction Act of 1995 (Pub. L. 104-13) 
(PRA). Additionally, in accordance with the PRA, OMB has approved the 
Department's reporting requirements for the States at: proposed Sec.  
618.870(e) concerning TAA program performance data (OMB control number 
1205-0392); and proposed Sec.  618.725(g) concerning written waivers of 
the training requirement, and proposed Sec. Sec.  618.855 and 618.860 
concerning reports on TAA activity in general (OMB control number 1205-
0016). The Department has determined that this proposed rule contains 
no new information collection requirements.

Executive Order 13132: Federalism

    The Department has reviewed this proposed rule revising the 
operation of a federal benefit program in accordance with Executive 
Order 13132 and found that it will not have substantial direct effects 
on the States or the relationship between the national government and 
the States, or the distribution of power and responsibilities among the 
various levels of government, within the meaning of the Executive 
Order.

Unfunded Mandates Reform Act and Executive Order 12875

    This regulatory action has been reviewed in accordance with the 
Unfunded Mandates Reform Act of 1995 (Pub. L. 104-4) and Executive 
Order 12875. The Department has determined that this rule does not 
include any federal mandate that may result in increased expenditures 
by state, local, or tribal governments, in the aggregate, or by the 
private sector, of $100 million or more in any one year. Accordingly, 
the Department has not prepared a budgetary impact statement.

Regulatory Flexibility Act/SBREFA

    We have notified the Chief Counsel for Advocacy, Small Business 
Administration, and made the certification pursuant to the Regulatory 
Flexibility Act (RFA) at 5 U.S.C. 605(b), that this proposed rule will 
not have a significant economic impact on a substantial number of small 
entities. Under the RFA, no regulatory flexibility analysis is required 
where the rule ``will not * * * have a significant economic impact on a 
substantial number of small entities.'' 5 U.S.C. 605(b). A small entity 
is defined as a small business, small not-for-profit organization, or 
small governmental jurisdiction. 5 U.S.C. 601(3)-(5). Therefore, the 
definition of the term ``small entity'' does not include States or 
individuals.
    This rule revises and updates procedures governing an entitlement 
program administered by the States and not by small governmental 
jurisdictions. In addition, the entitlement program applies to 
individuals who seek certification of eligibility under the program 
only, and not small entities as defined by the Regulatory Flexibility 
Act. Therefore, the Department certifies that this proposed rule will 
not have a significant impact on a substantial number of small entities 
and, as a result, no regulatory flexibility analysis is required.
    In addition, the Department certifies that this proposed rule is 
not a major rule as defined by section 804 of the Small Business 
Regulatory Enforcement Act of 1996 (SBREFA). Under section 804 of 
SBREFA, a major rule is one that is an ``economically significant 
regulatory action'' within the meaning of Executive Order 12866. 
Because this proposed rule is not an economically significant rule 
under Executive Order 12866, we certify that it also is not a major 
rule under SBREFA.

Effect on Family Life

    The Department certifies that this proposed rule has been assessed 
in accordance with section 654 of Public Law 105-277, 112 Stat. 2681, 
for its effect on family well-being. The Department concludes that the 
rule will not adversely affect the well-being of the nation's families. 
Rather, it should have a positive effect on family well-being by 
providing greater benefits, including health insurance coverage 
assistance, to eligible individuals.

Congressional Review Act

    This proposed rule is not a ``major rule'' as defined in the 
Congressional Review Act (5 U.S.C. 801 et seq.). If promulgated as a 
final rule, this rule will not result in an annual effect on the 
economy of $100,000,000 or more; a major increase in costs or prices 
for consumers, individual industries, Federal, State, or local 
government agencies, or geographic regions; or significant adverse 
effects on competition, employment, investment, productivity, 
innovation, or on the ability of United States-based enterprises to 
compete with foreign-based enterprises in domestic and export markets.

Catalogue of Federal Domestic Assistance Number

    This program is listed in the Catalogue of Federal Domestic 
Assistance at No. 17.245.

List of Subjects

20 CFR Parts 617 and 618

    Administrative practice and procedure, Employment, Fraud, Grant 
programs-labor, Manpower training programs, Relocation assistance, 
Reporting and recordkeeping requirements, Trade adjustment assistance, 
Vocational education.

20 CFR Parts 665 and 671

    Employment, Grant programs--labor.

Words of Issuance

    For the reasons stated in the preamble, Part 617 of title 20, Code 
of Federal Regulations, is amended, Part 618 of title 20, Code of 
Federal Regulations is added, and Part 665 and 671 of title 20, Code of 
Federal Regulations, as amended, as set forth as follows:

    Signed at Washington, DC on July 27, 2006.
Emily Stover DeRocco,
Assistant Secretary of Labor.

PART 617--TRADE ADJUSTMENT ASSISTANCE FOR WORKERS UNDER THE TRADE 
ACT OF 1974

    1. The authority citation for part 617 continues to read as 
follows:

    Authority: 19 U.S.C. 2320; Secretary's Order No. 3-81, 46 FR 
31117.

    2. The heading for part 617 is revised to read as follows:

PART 617--TRADE ADJUSTMENT ASSISTANCE UNDER THE TRADE ACT OF 1974 
FOR WORKERS CERTIFIED UNDER PETITIONS FILED BEFORE NOVEMBER 4, 2002

    3. Section Sec.  617.1 is amended by revising paragraphs (a) and 
(b) to read as follows:


Sec.  617.1  Scope.

    The regulations in this part 617 pertain to:
    (a) Adjustment assistance, such as counseling, testing, training, 
placement, and other supportive services for adversely affected workers 
under the terms of chapter 2 of title II of the Trade Act of 1974, as 
amended prior to August 6, 2002 (the Act), covered by certifications 
issued under petitions filed with the Secretary before November 4, 
2002;
    (b) Trade readjustment allowances (TRA) and other allowances such 
as allowances while in training, job search and relocation allowances, 
for adversely affected workers under the Act covered by certifications 
issued under petitions

[[Page 50799]]

filed with the Secretary before November 4, 2002; and
* * * * *
    4. Section 617.10 is amended by adding paragraph (e) to read as 
follows:


Sec.  617.10  Applications for TRA.

* * * * *
    (e) Advising workers to apply for health coverage tax credit. State 
agencies will advise each worker of the qualifying requirements for the 
health coverage tax credit (HCTC) and related health insurance 
assistance.
    5. Title 20, chapter V, is amended by adding new part 618 to read 
as follows:

PART 618--TRADE ADJUSTMENT ASSISTANCE UNDER THE TRADE ACT OF 1974 
FOR WORKERS CERTIFIED UNDER PETITIONS FILED AFTER NOVEMBER 3, 2002

Subpart A--General

Sec.
618.100 Purpose and scope.
618.105 Effective dates for the 2002 amendments to the Trade Act of 
1974.
618.110 Definitions.

Subpart B--[Reserved]

Subpart C--Delivery of Services through the One-Stop System

Sec.
618.300 Scope.
618.305 The TAA program as a One-Stop partner.
618.310 Responsibilities for the delivery of employment services not 
funded under the Act.
618.315 Responsibilities for the delivery of employment services 
funded under the Act.
618.320 Coordination with WIA-funded rapid response activities.
618.325 Integrated service strategies to ensure that a comprehensive 
array of services are provided by WIA or other programs.
618.330 Assessment of adversely affected workers.
618.335 Initial assessment of adversely affected workers.
618.340 Employment services and waiver provisions for workers not 
enrolled in training.
618.345 Comprehensive assessment for adversely affected workers.
618.350 IEPs for adversely affected workers.
618.355 Staff requirements for assessments.
618.360 Employment services for workers enrolled in training and 
follow-up services.
618.365 Employment services and the TAA for Farmers program.

Subpart D--Job Search Allowances

618.400 Scope.
618.405 Applying for a job search allowance.
618.410 Eligibility for a job search allowance.
618.415 Findings required.
618.420 Amount of a job search allowance.
618.425 Determination and payment of a job search allowance.
618.430 Job search program participation.

Subpart E--Relocation Allowances

618.500 Scope.
618.505 General.
618.510 Applying for a relocation allowance.
618.515 Eligibility for a relocation allowance.
618.520 Findings required.
618.525 Determining the amount of a relocation allowance.
618.530 Determinations and payment of a relocation allowance.
Subpart F--Training Services
618.600 Scope.
618.605 Procedures.
618.610 Criteria for approval of training.
618.615 Limitations on approval of training.
618.620 Selection of training program.
618.625 Payment restrictions for training programs.
618.630 Training of reemployed workers not in suitable employment.
618.635 Enrollment in on-the-job and customized training.
618.640 Subsistence and transportation payments.
618.645 Voluntary withdrawal from a training program.
618.650 State training cost caps.
618.655 Training services and TAA for Farmers program.
Subpart G--Trade Readjustment Allowances
618.700 Scope.
618.705 Categories of TRA.
618.710 Applications for TRA and payment.
618.715 Qualifying requirements for basic TRA.
618.720 Training requirement for receipt of basic, additional, and 
remedial TRA.
618.725 Waiver of training requirement for basic TRA.
618.730 Evidence of qualification for basic, additional, and 
remedial TRA.
618.735 Weekly amounts of basic, additional, and remedial TRA.
618.740 Maximum amount of basic TRA.
618.745 Eligibility period for basic TRA.
618.750 Qualifying requirements for, and duration of, additional 
TRA.
618.755 Qualifying requirements for, and duration of, remedial TRA.
618.760 Payment of basic, additional, or remedial TRA during breaks 
in training.
618.765 Disqualifications.
618.770 Health Coverage Tax Credit.
Subpart H--Administration By Applicable State Agencies
618.800 Scope.
618.805 Agreements with the Secretary of Labor.
618.810 Cooperating State agency rulemaking.
618.815 Subpoenas.
618.820 TAA program and benefit information to workers.
618.825 Determinations of eligibility; notices to individuals.
618.830 Liable State and agent State responsibilities.
618.835 Appeals and hearings.
618.840 Overpayments; penalties for fraud.
618.845 Recovery of debts due the United States or to others by TAA 
offset.
618.850 Uniform interpretation and application of the Act and 
regulations.
618.855 Inviolate rights to TAA or ATAA.
618.860 Veterans' priority of service.
618.865 Recordkeeping and disclosure of information requirements.
618.870 Information, reports, and studies.
618.875 General fiscal and administrative requirements.
618.880 TAA program performance.
618.885 Termination of TAA program benefits.

    Authority: 19 U.S.C. 2320; Secretary's Order No. 3-81, 46 FR 
31117.

Subpart I--[Reserved]

Subpart A--General


Sec.  618.100  Purpose and scope.

    (a) The Trade Act of 1974, as amended (the Act), establishes a 
trade adjustment assistance (TAA) program. The goal of the TAA program 
is to provide adversely affected workers with assistance to return them 
to work that will use the highest skill levels and pay the highest 
wages given the workers' preexisting skill levels and education and the 
condition of the labor market, and to do so as quickly as possible. The 
TAA program also includes the ATAA program, which may be available to 
workers 50 years of age or older. Workers who have lost their jobs with 
firms who supplied, or were downstream producers to, other firms whose 
workers were certified as eligible to apply for TAA may also be covered 
under the TAA program. The regulations in this part 618 are issued to 
implement the Act.
    (b) This part 618 covers:
    (1) The scope, purpose, effective dates and transition guidelines, 
and definitions of terms applicable to the TAA program;
    (2) [Reserved];
    (3) Counseling, testing, placement, and other supportive services 
for adversely affected workers and agricultural commodity producers 
entitled to receive a cash benefit under the TAA for Farmers program 
(subpart C);
    (4) Job search allowances for adversely affected workers (subpart 
D);
    (5) Relocation allowances for adversely affected workers (subpart 
E);
    (6) Training for adversely affected workers (subpart F);

[[Page 50800]]

    (7) Trade readjustment allowances (TRA) for adversely affected 
workers (subpart G);
    (8) Administrative requirements applicable to State agencies 
administering the TAA program and assistance for individuals (subpart 
H);
    (9) [Reserved].


Sec.  618.105  Effective dates for the 2002 amendments to the Trade Act 
of 1974.

    Section 151 of the Trade Adjustment Assistance Reform Act of 2002 
(the ``Reform Act''), Public Law 107-210, provides that its amendments 
governing Trade Adjustment Assistance for Workers applies to petitions 
for certification filed on or after November 4, 2002. However, ATAA 
became effective on August 6, 2003 and the Health Coverage Tax Credit 
(HCTC), established under 26 U.S.C. 35 (administered by the Internal 
Revenue Service), generally became effective on December 1, 2002. 
Consistent with section 151 of the Reform Act, Part 617 of title 20 of 
the Code of Federal Regulations governs the operational and benefit 
provisions of the TAA program for petitions filed before November 4, 
2002, even where the determinations are made after that date.


Sec.  618.110  Definitions.

    The following definitions apply in this part.
    Act means chapter 2 of title II of the Trade Act of 1974, Public 
Law 93-618, 88 Stat. 1978, 2011 et seq. (19 U.S.C. 2271-2321 and 2395), 
as amended.
    Additional compensation means unemployment compensation totally 
financed by a State and payable under State law by reason of conditions 
of high unemployment or by reason of other special factors and, when so 
payable, includes unemployment compensation payable under chapter 85, 
title 5 of the United States Code.
    Adversely affected employment means employment in a firm or 
appropriate subdivision of a firm (which may include workers in any 
agricultural firm or subdivision of an agricultural firm), if workers 
of such firm or subdivision are certified as eligible to apply for 
trade adjustment assistance under this part.
    Adversely affected worker means an individual, including an 
employer, who, because of lack of work in adversely affected 
employment--
    (1) Has been totally or partially separated from such employment 
between the impact date and two years after the date on which the 
certification is signed, unless the certification expires or is 
terminated earlier; or
    (2) Has been totally separated from employment with the firm in a 
subdivision of which such adversely affected employment exists between 
the impact date and two years after the date on which the certification 
is signed, unless the certification expires or is terminated earlier.
    Agent State means any State other than the liable State for an 
adversely affected worker.
    Alternative trade adjustment assistance, Alternative TAA or ATAA 
means a wage subsidy for adversely affected workers 50 years of age and 
older.
    Applicable State law means, for any adversely affected worker, the 
State law of the State--
    (1) In which such worker is entitled to UI (whether or not such 
worker has filed a UI claim) immediately following such worker's first 
separation, or
    (2) If the adversely affected worker is not so entitled to UI under 
the State law of any State immediately following such first separation, 
or is entitled to UI under the Railroad Unemployment Insurance Act 
(RRUI), the State law of the State in which such first separation 
occurred.
    (3) The applicable State law for an adversely affected worker, as 
determined under paragraphs (1) and (2) of this definition, remains the 
applicable State law for such worker until such worker becomes entitled 
to UI under the State law of another State (whether or not such worker 
files a UI claim in that other State).
    (4) For purposes of determining the applicable State law for UI 
entitlement under paragraph (1) of this definition--
    (i) An adversely affected worker is deemed entitled to UI under a 
State law if such worker satisfies the base period employment and wage 
qualifying requirements of such State law.
    (ii) In the case of a combined-wage claim (under part 616 of this 
chapter), UI entitlement must be determined under the law of the paying 
State.
    (iii) In case of a Federal UI claim, or a joint State and Federal 
UI claim (under parts 609 and 614 of this chapter), UI entitlement must 
be determined under the law of the applicable State for such claims.
    Average weekly hours means a figure obtained by dividing:
    (1) Total hours worked (excluding overtime) by a partially 
separated worker in adversely affected employment in the 52 weeks 
(excluding weeks in such period during which the individual was sick or 
on vacation) preceding the individual's first qualifying separation, by
    (2) The number of weeks in such 52 weeks (excluding weeks in such 
period during which the individual was sick or on vacation) in which 
the individual actually worked in such employment.
    Average weekly wage means one-thirteenth of the total wages paid to 
an individual in the individual's high quarter. The high quarter for an 
individual is the quarter in which the total wages paid to the 
individual were highest among the first four of the last five completed 
calendar quarters preceding the week in which the individual's first 
separation occurred.
    Benefit period means, with respect to an individual--
    (1) The benefit year and any ensuing period, as determined under 
the applicable State law, during which the individual is eligible for 
regular compensation, additional compensation, extended compensation, 
or Federal supplemental compensation, or
    (2) The equivalent of such a benefit year or ensuing period 
provided for under the applicable Federal unemployment insurance law.
    Bona fide application for training means an individual's signed and 
dated application for training filed with the State agency 
administering the TAA training program, on a form provided by the 
cooperating State agency necessarily containing the individual's name, 
petition number, and specific occupational training.
    Certification means a certification of eligibility to apply for 
TAA, or TAA and ATAA, with respect to a specified group of workers of a 
firm or appropriate subdivision of a firm.
    Certification period means the period of time during which total 
and partial separations from adversely affected employment within a 
firm or appropriate subdivision of a firm are covered by the 
certification.
    Certifying officer means an official in the Employment and Training 
Administration, United States Department of Labor, who has been 
delegated the authority granted to the Secretary of Labor to make 
determinations and issue certifications of eligibility to apply for 
trade adjustment assistance.
    Co-enrollment means enrollment in the TAA program and at least one 
other program that operates as part of the WIA One-Stop delivery 
system, such as the Adult program under title I of the WIA.
    Commuting area means the area in which an individual would be 
expected to travel to and from work on a daily basis as determined 
under the applicable State law.
    Confidential business information means commercial or financial 
information received by the Director in an investigation of a petition 
for

[[Page 50801]]

certification of eligibility to apply for TAA, or TAA and ATAA, whose 
disclosure is prohibited under the Trade Secrets Act, 18 U.S.C. 1905.
    Cooperating State Agency (CSA) means the State workforce agency or 
any other State or local agency administering job training or related 
programs and which participates in the administration of the TAA 
program under an agreement with the Secretary to carry out any of the 
provisions of the Act.
    Customized training means training that is designed to meet the 
special requirements of one or more employers, as provided in Sec.  
618.635(b) (enrollment in on-the-job and customized training).
    Date of certification means the date on which the certifying 
officer signs the certification of eligibility to apply for TAA, or TAA 
and ATAA, for a group of adversely affected workers at a firm or 
appropriate subdivision.
    Date of filing means the date on which a complete petition is 
received by the Division of Trade Adjustment Assistance, Employment and 
Training Administration, United States Department of Labor, 200 
Constitution Avenue, NW., Washington, DC 20210.
    Date of separation means:
    (1) With respect to a total separation--
    (i) For an individual in employment status, the last day worked; or
    (ii) For an individual on employer-authorized leave, the last day 
the individual would have worked had the individual not been on the 
employer-authorized leave; or
    (2) With respect to a partial separation, the last day of the week 
in which the partial separation occurred.
    Department of Labor or Department or DOL means the United States 
Department of Labor.
    Director means the Director, Division of Trade Adjustment 
Assistance, Employment and Training Administration, United States 
Department of Labor, Washington, DC, who has responsibility for 
administering the TAA programs, or his or her designee.
    Division of Trade Adjustment Assistance or DTAA means the 
organization within the Employment and Training Administration, DOL, 
Washington, DC that administers the TAA programs, or its successor 
organization.
    Eligible ATAA recipient means an individual who is receiving 
benefits under a demonstration program of Alternative Trade Adjustment 
Assistance for older workers under subpart I of part 618.
    Eligible PBGC pension recipient means an individual who is 55 years 
of age or older and is receiving a pension benefit paid in whole or 
part by the Pension Benefit Guaranty Corporation (PBGC).
    Eligible TAA recipient means an individual who is receiving a trade 
readjustment allowance (TRA) under the TAA program, or would be 
eligible for TRA except that he/she has not yet exhausted Unemployment 
Insurance benefits.
    Employer means any individual or type of organization, including 
the Federal government, a State government, a political subdivision, or 
an instrumentality of one or more governmental entities, with one or 
more individuals performing service in employment for it within the 
United States.
    Employment means any service performed for an employer by an 
officer of a corporation or by an individual for wages.
    Extended compensation or Extended Benefits or EB means the extended 
unemployment compensation payable to an individual for weeks of 
unemployment which begin in an Extended Benefits Period, under those 
provisions of a State law which satisfy the requirements of the 
Federal-State Extended Unemployment Compensation Act of 1970 and 
regulations governing the payment of extended unemployment compensation 
and, when so payable, includes unemployment compensation payable under 
chapter 85 of title 5 of the United States Code, but does not include 
regular compensation, additional compensation, or Federal supplemental 
compensation. Extended compensation is explained further in part 615 
(Extended Benefits in the Federal-State Unemployment Compensation 
Program) of title 20 of the Code of Federal Regulations.
    Family means the following members of an individual's household 
whose principal place of abode is with the individual in a home the 
individual maintains or would maintain but for unemployment:
    (1) A spouse;
    (2) An unmarried child, including a stepchild, adopted child, or 
foster child, under age 21 or of any age if incapable of self-support 
because of mental or physical incapacity; and
    (3) Any other person whom the individual would be entitled to claim 
as a dependent for income tax purposes under the Internal Revenue Code 
of 1986, as amended.
    Federal student financial assistance means student financial 
assistance authorized by title IV of the Higher Education Act of 1965, 
as amended (20 U.S.C. 1070 et seq.): Grants to Students in Attendance 
at Institutions of Higher Education (20 U.S.C. 1070a-1070f-6) 
(popularly known as Pell grants); Federal Family Education Loan Program 
(20 U.S.C. 1071-1087-4; William D. Ford Federal Direct Loan Program (20 
U.S.C. 1087a-1087j); Federal Perkins Loans (20 U.S.C. 1087aa-1087ii); 
Federal Work-Study Programs (42 U.S.C. 2751-2756b); and Bureau of 
Indian Affairs student assistance programs, such as Indian and Alaska 
Native forestry education assistance programs (35 U.S.C. 3113).
    Federal supplemental compensation means the Federal supplemental 
unemployment compensation payable to individuals under the Temporary 
Extended Unemployment Compensation Act of 2002 or any similar Federal 
law.
    Firm means an individual proprietorship, partnership, joint 
venture, association, corporation (including a development 
corporation), business trust, cooperative, trustee in bankruptcy, or 
receiver under decree of any court. A firm, together with any 
predecessor or successor-in-interest, or together with any affiliated 
firm controlled or substantially beneficially owned by substantially 
the same persons may be considered a single firm.
    First benefit period means the benefit period established after the 
worker's first qualifying separation or in which such separation 
occurs.
    First qualifying separation means, for the purposes of determining 
the weekly and maximum amounts of basic TRA payable to an individual, 
the individual's first (total or partial) separation within the 
certification period of a certification if, with respect to such 
separation, the individual meets the requirements of paragraphs (a), 
(b), and (d) of Sec.  618.715 (qualifying requirements for basic TRA).
    First separation means, for an individual to qualify as an 
adversely affected worker for the purposes of TAA program benefits 
(without regard to whether the individual also qualifies for TRA), the 
individual's first total or partial separation within the certification 
period of a certification, irrespective of whether such first 
separation also is a qualifying separation.
    Health Coverage Tax Credit or HCTC means the tax credit for the 
costs of health insurance coverage of eligible individuals authorized 
by section 35 of the Internal Revenue Code of 1986 (relating to 
refundable credits), as amended (26 U.S.C. 35).
    Impact date means the date stated in a certification of eligibility 
to apply for TAA, or TAA and ATAA, on which the

[[Page 50802]]

total or partial separations of the workers covered by the 
certification began or threatened to begin.
    Individual Employment Plan or IEP means a document containing an 
ongoing strategy jointly developed by the participant and the CSA, 
which identifies the participant's employment goals, the appropriate 
achievement objectives, and the appropriate combination of services for 
the participant to achieve the employment goals. Generally, the IEP is 
prepared after conducting both an initial assessment and a 
comprehensive assessment of the worker's employment goals and 
strategies to achieve those goals.
    Job finding club means a job search workshop that includes a period 
of 1 to 2 weeks of structured, supervised activity in which 
participants attempt to obtain jobs.
    Job search program or JSP means a job search workshop or job 
finding club.
    Job search workshop means a short (1 to 3 days) seminar designed to 
provide participants with knowledge that will enable the participants 
to find jobs. Subjects of the seminar include labor market information, 
resume writing, interviewing techniques, and techniques for finding job 
openings.
    Lack of work means that the employer does not have work for the 
worker to perform, and includes circumstances when:
    (1) Work is not available because the employer closes or ceases 
operations; or
    (2) Work is not available because the employer downsizes the 
workforce by means of attrition or layoff, including downsizing when an 
employee accepts an employer's offer of a severance package designed by 
the employer to encourage voluntary separations; or
    (3) Work to maintain the worker's customary hours of work is not 
available.
    Layoff means a suspension of or separation from employment by a 
firm for lack of work, initiated by the employer, and expected to be 
for a definite or indefinite period of not less than seven (7) 
consecutive days.
    Liable State means the State whose State law is the applicable 
State law for an adversely affected worker.
    One-Stop delivery system means the system of entities operating 
under title I of WIA to administer and deliver workforce investment, 
educational, and other human resource program services to enhance 
access to these services in local areas and improve long-term 
employment, as described in part 662 of title 20 of the Code of Federal 
Regulations.
    On-the-job training means training provided by an employer to an 
individual, as provided in Sec.  618.635(a)(1) (enrollment in on-the-
job and customized training).
    Partial separation means, for a worker who has not been totally 
separated, whether the worker either is covered by a petition for 
certification of eligibility to apply for TAA, or TAA and ATAA, or the 
worker has been certified as an adversely affected worker, that:
    (1) The worker's hours of work have been reduced to 80 percent or 
less of the worker's average weekly hours at the firm or in adversely 
affected employment during a week ending on or after the impact date 
specified in the certification under which the adversely affected 
worker is covered; and
    (2) The worker's wages have been reduced to 80 percent or less of 
the worker's average weekly wage at the firm or in adversely affected 
employment during a week ending on or after the impact date specified 
in the certification under which the adversely affected worker is 
covered.
    Program of remedial education means training that is designed to 
enhance the employability of an adversely affected worker by upgrading 
basic knowledge through such courses as adult basic education, basic 
math and literacy, English-as-a-second-language, and high school 
equivalency, among others.
    Qualifying separation means, for an individual to qualify as an 
adversely affected worker and for basic TRA, for determining the 16-
week period for enrollment in approved training as a condition of TRA, 
and for determining the basic TRA eligibility period, any total 
separation of the individual within the certification period of a 
certification, with respect to which the individual meets all of the 
requirements in paragraphs (a), (b), (c) and (d) of Sec.  618.715 
(qualifying requirements for basic TRA).
    Regional Administrator means the appropriate Regional Administrator 
of the Employment and Training Administration, U.S. Department of 
Labor.
    Regular compensation means unemployment compensation payable to an 
individual under any State law, and, when so payable, includes 
unemployment compensation payable under chapter 85, title 5 of the 
United States Code, but does not include extended compensation, 
additional compensation or federal supplemental compensation.
    Secretary means the Secretary of Labor, U.S. Department of Labor, 
or his or her designee.
    State means the States of the United States, the District of 
Columbia and the Commonwealth of Puerto Rico; and the term ``United 
States,'' when used in the geographical sense, includes the 
Commonwealth of Puerto Rico.
    State agency means the agency of the State that administers the 
State law.
    State law means the unemployment insurance law of a State approved 
by the Secretary under section 3304 of the Internal Revenue Code of 
1986 (26 U.S.C. 3304).
    Suitable employment means work of a substantially equal or higher 
skill level than the worker's previous adversely affected employment 
and wages for such work at not less than 80 percent of the worker's 
average weekly wage, including (or taking into consideration) the value 
of fringe benefits, including health insurance.
    Suitable work means, with respect to an individual--
    (1) Suitable work as defined in the applicable State law for 
claimants for regular compensation; or
    (2) Suitable work as defined in applicable State law provisions 
consistent with section 202(a)(3) of the Federal-State Extended 
Unemployment Compensation Act of 1970; whichever is applicable, but 
does not in any case include self-employment or employment as an 
independent contractor.
    Supportive services means services such as transportation, 
childcare, dependent care, and housing that are needed to enable an 
individual to participate in activities authorized under the Act.
    Total separation means the layoff or severance of a worker from 
employment in a firm in which adversely affected employment exists or 
has been alleged to exist in a petition for certification of 
eligibility to apply for TAA.
    Trade adjustment assistance or TAA means the benefits and services 
provided under subparts D, E, F, and G of this part 618 and not ATAA 
provided under subpart I [Reserved]. TAA also includes certain 
employment services provided to adversely affected workers, as 
described in subpart C of this part 618.
    Trade adjustment assistance for Farmers program or TAA for Farmers 
program means the program implemented by regulations codified at 7 CFR 
part 1580 and in Sec. Sec.  618.365 (employment services and the TAA 
for Farmers program) and 618.655 (training services and TAA for Farmers 
program). Under this program the Department of Agriculture provides 
technical assistance and certifies qualified agricultural commodity 
producers as

[[Page 50803]]

eligible to apply for cash benefits from the Department of Agriculture.
    Trade readjustment allowance or TRA means a weekly allowance 
payable to an adversely affected worker with respect to such worker's 
unemployment under subpart G of this part 618.
    Unemployment insurance or UI means the unemployment compensation 
payable to an individual under any State law or Federal unemployment 
compensation law, including chapter 85 of title 5, United States Code 
(5 U.S.C. 8501 et seq.) and the Railroad Unemployment Insurance Act (45 
U.S.C. 351 et seq.), and includes: Regular compensation, additional 
compensation, extended compensation or extended benefits or EB, and 
Federal supplemental compensation.
    Wages means all compensation for employment for an employer, 
including commissions, bonuses, and the cash value of all compensation 
in a medium other than cash.
    Wagner-Peyser Act means the Wagner-Peyser Act, as amended (29 
U.S.C. 49 et seq.).
    Week means a week as defined in the applicable State law.
    Week of unemployment means a week of total, part total, or partial 
unemployment as determined under the applicable State law or Federal 
unemployment insurance law.
    Workforce Investment Act or WIA means the Workforce Investment Act 
of 1998 (Pub. L. 105-220), as amended (29 U.S.C. 2801 et seq.).

Subpart B--[Reserved]

Subpart C--Delivery of Services Through the One-Stop System


Sec.  618.300  Scope.

    This subpart requires cooperating State agencies, under the 
agreements signed with the Secretary under Sec.  618.805 (agreements 
with the Secretary of Labor), to integrate the provision of benefits 
and services available to workers separated or threatened with 
separation under the TAA program with the delivery of employment 
services and other assistance provided under any Federal law other than 
the Act, through the One-Stop service delivery system (established 
under title I of the Workforce Investment Act of 1998 (WIA)), as 
required by sections 235 and 239(a), (e), and (g) of the Act. It also 
implements the requirements of section 221(a)(2)(A) of the Act for the 
provision of rapid response assistance and intensive services described 
in WIA section 134(d)(2) and (3) for workers upon the receipt of a 
petition covering those workers.


Sec.  618.305  The TAA program as a One-Stop partner.

    The cooperating State agency must ensure that the TAA program 
complies with One-Stop partnership requirements in 20 CFR 662.230.


Sec.  618.310  Responsibilities for the delivery of employment services 
not funded under the Act.

    (a) The cooperating State agency must assure the following services 
are made available to individuals covered under a petition for 
certification of eligibility to apply for TAA or TAA and ATAA:
    (1) Rapid response assistance (as specified in Sec.  618.320 
(coordination with WIA-funded rapid response activities)); and
    (2) Core and applicable intensive services, as needed through the 
One-Stop delivery system.
    (b) The cooperating State agency must make every reasonable effort 
to ensure that the core and intensive services available to adversely 
affected workers, including those certified as eligible to apply for 
ATAA, include the following services:
    (1) Wagner-Peyser Act labor exchange services;
    (2) Assessment;
    (3) Employment counseling;
    (4) Vocational testing;
    (5) Placement services;
    (6) Development of Individual Employment Plans (IEPs) for adversely 
affected workers, as specified in Sec.  618.350; and
    (7) Supportive services, as defined in Sec.  618.110.
    (c) The cooperating State agency must make every reasonable effort 
to ensure the provision of services authorized under other Federal laws 
for all adversely affected workers.
    (d) The services described in this section may be paid for with WIA 
or Wagner-Peyser funds or with funds from One-Stop partner programs if 
the workers meet the eligibility requirements of those programs.
    (e)(1) Except as provided in paragraph (e)(2) of this section, 
adversely affected workers who meet the definition of a dislocated 
worker under WIA, section 101(9), may participate in appropriate core, 
intensive, training, and supportive services funded with WIA Dislocated 
Worker funds.
    (2) Those adversely affected workers who are partially separated 
generally will not meet the WIA definition of a dislocated worker and 
therefore may not be served with WIA Dislocated Worker funds. Such 
workers may be served in WIA-funded Adult Worker programs and receive 
similar One-Stop core, intensive, training and supportive services.


Sec.  618.315  Responsibilities for the delivery of employment services 
funded under the Act.

    (a) The CSA is responsible for providing information to individuals 
about TAA, as required in Sec.  618.820 (TAA program and benefit 
information to workers);
    (b) The CSA is responsible for providing the following services to 
adversely affected workers, which may be paid out of TAA funds:
    (1) Interviewing each adversely affected worker about suitable 
training opportunities reasonably available to each worker under 
subpart F of this Part, reviewing such opportunities with each worker, 
informing each worker of the requirements for participation in 
training, including the enrollment deadlines, as a condition for 
receiving TRA, and accepting applications for training;
    (2) Informing adversely affected workers of the employment services 
and allowances available under the Act and this part 618, the 
application procedures, the filing requirements for such employment 
services and the training requirement and enrollment deadlines for 
receiving TRA;
    (3) Determining whether suitable employment, as defined in Sec.  
618.110, is available;
    (4) Providing self-directed job search training, when necessary;
    (5) Providing training;
    (6) Providing job search and relocation allowances;
    (7) Determining which training institutions offer training programs 
at a reasonable cost and with a reasonable expectation of employment 
(as described in Sec.  618.610(c)) following the completion of such 
training, and procuring such training;
    (8) Documenting the standards and procedures used to select 
occupations and training institutions in which training is approved;
    (9) Approving training programs for adversely affected workers;
    (10) Monitoring the progress and attendance of adversely affected 
workers in approved training programs;
    (11) Developing and implementing a procedure for determining 
whether to issue a training waiver and reviewing waivers and extensions 
at least every 30 days to determine whether the conditions under which 
they are issued have changed; and
    (12) Coordinating the administration and delivery of employment 
services,

[[Page 50804]]

benefits, training, and supplemental assistance for workers with 
programs under the Act, the Wagner-Peyser Act, and the WIA.


Sec.  618.320  Coordination with WIA-funded rapid response activities.

    (a) Upon the filing of a petition, the Governor must ensure that 
rapid response assistance is made available, consistent with 20 CFR 
665.300 and 20 CFR 665.310 (WIA rapid response activities).
    (1) If rapid response activities have been provided previously in 
response to a layoff or plant closure or other event, then the Governor 
must determine whether the provision of any additional information or 
assistance related to the TAA program is necessary due to the filing of 
the petition. This may include information about training 
opportunities, income support, employment services, and potential HCTC 
assistance.
    (2) If rapid response assistance has not been provided previously 
in response to a layoff or plant closure or other event, then the 
Governor must ensure that appropriate rapid response assistance is 
provided. The Governor may develop and implement appropriate methods of 
achieving the goals of rapid response in situations where the full 
range of rapid response activities required by 20 CFR 665.310 is not 
appropriate. The alternative methods should be cost effective and 
responsive to the workers' needs. At a minimum, information and access 
to unemployment compensation benefits, comprehensive One-Stop system 
services, employment services, and TAA program benefits, must be 
provided.
    (b) The Governor is encouraged to provide workers for whom a TAA 
petition has been filed with access to appropriate WIA core and 
intensive services using rapid response funding before a determination 
on whether to certify the workers' petition is issued in order to 
assist a more rapid return to employment.


Sec.  618.325  Integrated service strategies to ensure that a 
comprehensive array of services are provided by WIA or other programs.

    (a) The cooperating State agency must collaborate with Local 
Workforce Investment Boards and other WIA One-Stop partners and is 
encouraged to collaborate with other available programs to ensure that 
adversely affected workers receive appropriate services, as described 
in Sec.  618.310 (responsibilities for the delivery of employment 
services not funded under the Act) and Sec.  618.315 (responsibilities 
for the delivery of employment services funded under the Act).
    (b) Any adversely affected worker may be co-enrolled (as defined in 
Sec.  618.110) in one or more appropriate One-Stop employment programs 
to ensure that all necessary and appropriate services are available for 
the worker. Where an adversely affected worker is not co-enrolled, the 
State must employ other integrated service strategies to ensure that 
such services are made available to the worker.


Sec.  618.330  Assessment of adversely affected workers.

    (a) The cooperating State agency must design its assessment process 
to protect a potentially eligible worker's access to TAA-approved 
training and to TRA. Services must be scheduled to provide the worker 
sufficient time and information to make a meaningful and timely request 
for training approval or a waiver, if appropriate, and protect the 
worker's eligibility to receive TRA.
    (b) The cooperating State agency must provide an adversely affected 
worker with an initial assessment, as described in, Sec.  618.335 and, 
if appropriate, a comprehensive assessment, as described in Sec.  
618.345, to determine which benefits and services, including training, 
are most appropriate to enable the worker to become reemployed.


Sec.  618.335  Initial assessment of adversely affected workers.

    (a) The initial assessment represents the first step in determining 
if the worker will need employment services, whether suitable 
employment is available to the worker without training, whether 
training is needed and feasible, whether any of the six criteria for 
issuing a waiver from the training requirement for receipt of TRA (as 
described in Sec.  618.725(b)(1) through (b)(6)) apply, and whether the 
worker may meet the requirements for ATAA and the HCTC. The initial 
assessment of the worker's likely employment opportunities in the local 
labor market must take into consideration the following factors:
    (1) Prevailing local labor market conditions, including the 
unemployment rate, local employer skill demands and hiring 
prerequisites;
    (2) Transferable skills that the worker may possess that would be 
of interest to other local employers; and
    (3) Any significant barriers to reemployment the worker has, such 
as:
    (i) Obsolete skills in the worker's present occupation;
    (ii) Skills similar to those of other workers that represent an 
excess supply in the labor market area; or
    (iii) Limited English language proficiency coupled with limited or 
no skills in demand in the local labor market area.
    (b) The initial assessment requirements may be satisfied by a WIA-
funded initial assessment. Assessments performed under the Wagner-
Peyser Act or other partner programs, or a worker's profile under the 
UI profiling system (section 303(j) of the Social Security Act (42 
U.S.C. 503(j)), may satisfy the initial assessment requirements if they 
meet the requirements of paragraph (a) of this section.
    (c) Based upon the information gathered in the initial assessment, 
described in paragraph (a) of this section, the cooperating State 
agency may:
    (1) Determine that suitable employment (as defined in Sec.  
618.110) is available to the worker, and if so, the cooperating State 
agency may provide WIA core and intensive services. If the worker 
disagrees with the determination, the cooperating State agency must 
provide the worker with a comprehensive assessment (under Sec.  
618.345) to be certain that the initial assessment is correct.
    (2) Determine that no suitable employment is available to the 
worker and, if so, the cooperating State agency may provide services as 
described in Sec.  618.310 (responsibilities for the delivery of 
employment services not funded under the Act) and Sec.  618.315 
(responsibilities for the delivery of employment services funded under 
the Act) and must provide a comprehensive assessment (as described in 
Sec.  618.345) of the worker's circumstances in order to develop a 
comprehensive service strategy for the adversely affected worker.
    (d) If the cooperating State agency determines under paragraph (c) 
of this section that an adversely affected worker lacks marketable 
skills with which the worker can reasonably be expected to secure 
suitable employment, as defined under Sec.  618.110, the cooperating 
State agency must advise the worker to apply for training under subpart 
F, or seek a waiver under Sec.  618.725 (waiver of training requirement 
for basic TRA).


Sec.  618.340  Employment services and waiver provisions for workers 
not enrolled in training.

    (a) The cooperating State agency must coordinate with the One-Stop 
delivery system to ensure the provision of services to adversely 
affected workers who are determined through the initial assessment 
under Sec.  618.335(a) (initial assessment of adversely affected

[[Page 50805]]

workers) to possess marketable skills for suitable employment and who 
are reasonably expected to find employment at equivalent wages in the 
foreseeable future. For these workers, in addition to the services 
discussed in Sec.  618.310 (responsibilities for the delivery of 
employment services not funded under the Act) and Sec.  618.315 
(responsibilities for the delivery of employment services funded under 
the Act), the cooperating State agency must take the following actions, 
as necessary, and in a timely manner, to assure that the workers' job 
search activities are efficient and effective:
    (1) Determine whether a waiver of the training requirement is 
appropriate under Sec.  618.725 (waiver of training requirement for 
basic TRA), and, if appropriate, issue the waiver;
    (2) Refer the worker to suitable work (as defined in Sec.  618.110, 
whichever is applicable to the worker) through appropriate labor 
exchange services provided by the public employment service system or 
through WIA core services.
    (b)(1) For workers whose initial assessment under Sec.  618.330 
(assessment of adversely affected workers) indicates that suitable 
employment is available but who are unsuccessful in their job search 
efforts, the cooperating State agency must establish procedures that 
will permit review of the assessment and of the reasons for the 
workers' circumstances, as follows:
    (i) If a waiver of the training requirement has not been issued, 
the review must occur in a sufficiently timely manner so as not to 
endanger a worker's eligibility for TRA under the time deadlines for 
enrollment in a training program described in Sec.  618.725(b).
    (ii) If a waiver of the training requirement has been issued based 
on the assessment that the worker has marketable skills, the review 
should be part of the cooperating State agency's 30-day waiver review 
procedures.
    (2) Based upon the review under paragraph (b)(1) of this section, 
the cooperating State agency may plan appropriate additional employment 
services and make a determination whether to continue or revoke a 
training waiver issued under Sec.  618.725, to provide additional core 
and intensive services, and/or supportive services, or to initiate a 
comprehensive assessment in preparation for training.


Sec.  618.345  Comprehensive assessment for adversely affected workers.

    (a) The cooperating State agency must arrange for a comprehensive 
assessment for each worker seeking TAA approval of a training program.
    (b) The comprehensive assessment must expand upon the initial 
assessment regarding the worker's skills, aptitudes, and abilities 
(including reading and math levels). The cooperating State agency 
should determine in the comprehensive assessment, the worker's 
interests as they relate to employment opportunities in demand either 
in the commuting area (as defined in Sec.  618.110) or, where there is 
no reasonable expectation of securing employment in the commuting area 
and the worker is interested in relocation to other areas, outside of 
the commuting area.


Sec.  618.350  IEPs for adversely affected workers.

    A cooperating State agency must prepare an IEP, as defined in Sec.  
618.110, for any worker who receives a comprehensive assessment. The 
IEP must document the result of the comprehensive assessment and 
document a service strategy to provide the worker with the services 
needed to obtain employment. The IEP must document:
    (a) Whether or not each of the six criteria for training approval 
in Sec.  618.610(a) through (f) (criteria for approval of training) or 
for issuing a training waiver under Sec.  618.725 has been met;
    (b) The type of training proposed, if any;
    (c) Any additional services that will be needed by the worker to 
obtain employment, including intensive services, supportive services, 
and post-training and follow-up services; and
    (d) Any prearrangements (as described in Sec.  618.625(c) (payment 
restrictions for training programs)) for sharing the costs of the 
worker's approved training program, any amendments of the training 
program, and any subsistence or transportation payments provided and 
the basis for its calculation.


Sec.  618.355  Staff requirements for assessments.

    Staff performing either the initial or comprehensive assessment 
should possess the following:
    (a) An understanding of the local labor market;
    (b) Knowledge of local employer skill demands and hiring 
prerequisites, such as educational requirements and professional 
certifications, and the sets of skills workers from various occupations 
are likely to possess;
    (c) The ability to identify transferable skills that a worker may 
possess that would be of interest to other local employers outside of 
the worker's present occupational area;
    (d) The ability to evaluate quickly a worker's knowledge of and 
ability to implement job search strategies with little or no 
assistance; and
    (e) The ability to identify a worker's apparent employment barriers 
that will require additional training and counseling.


Sec.  618.360  Employment services for workers enrolled in training and 
follow-up services.

    (a) The cooperating State agency must ensure that all workers who 
enroll in training continue to receive access to the full range of core 
and intensive services as discussed in Sec.  618.310 (responsibilities 
for the delivery of employment services not funded under the Act) and 
Sec.  618.315 (responsibilities for the delivery of employment services 
funded under the Act), as appropriate, to facilitate their appropriate 
and timely re-employment.
    (b) The cooperating State agency must provide follow-up services, 
including placement and other appropriate supportive services to 
workers upon completion of training.


Sec.  618.365  Employment services and the TAA for Farmers program.

    The cooperating State agency must provide employment services to 
individuals entitled to cash benefits under the TAA for Farmers program 
administered by the U.S. Department of Agriculture. Such individuals 
may also receive training and incidental supplemental assistance under 
subpart F of this part. However, they are not entitled to any other 
benefits under the TAA program or under ATAA, including TRA under 
subpart G of this part, job search allowances under subpart D of this 
part, or relocation allowances under subpart E of this Part.

Subpart D--Job Search Allowances.


Sec.  618.400  Scope.

    This subpart D sets forth the conditions under which an adversely 
affected worker may apply for and receive a job search allowance to 
help the worker secure suitable employment outside the commuting area 
but within the United States.


Sec.  618.405  Applying for a job search allowance.

    (a) Forms. To receive a job search allowance, an adversely affected 
worker must apply to the cooperating State agency, using the forms that 
such agency will furnish upon request.

[[Page 50806]]

    (b) Submittal. A worker who has a total or partial separation may 
apply to the cooperating State agency for a job search allowance after 
a certification has been issued covering the worker. The worker must 
apply for a job search allowance before beginning a job search, and the 
job search allowance will not be approved until the cooperating State 
agency has determined that the worker is covered by a certification.
    (c) Time limits. To receive a job search allowance, the worker must 
apply before the later of the following:
    (1) The 365th day after either the date of the certification under 
which he or she is covered, or the 365th day after his or her last 
total separation, whichever is later; or
    (2) The 182nd day after the date of concluding approved training, 
unless the worker received a waiver of the participation in training 
requirement, in which event this paragraph (c)(2) is inapplicable.


Sec.  618.410  Eligibility for a job search allowance.

    (a) Conditions. To be eligible for a job search allowance a worker 
must:
    (1) File a timely application within the deadlines imposed by Sec.  
618.405(c) (applying for a job search allowance);
    (2) Be an adversely affected worker totally separated from the job 
covered under the certification when he or she begins the job search;
    (3) Receive a determination by the cooperating State agency that he 
or she cannot reasonably expect to secure suitable employment (as 
defined in Sec.  618.110) in the commuting area (as defined in Sec.  
618.110), and can reasonably expect to obtain suitable employment 
affording a reasonable expectation of employment of a long-term 
duration outside the commuting area and in the area of the job search.
    (4) Not have previously received a relocation allowance under 
subpart E under this same certification; and
    (5) Begin each job search after the date of the certification and 
complete each State approved job search within 30 calendar days after 
the worker leaves the commuting area to begin the job search.
    (b) Completion of job search. A job search is completed when the 
worker either obtains a job or has contacted each employer the worker 
planned to contact or to whom the cooperating State agency or other 
One-Stop partner referred the worker as part of the job search.


Sec.  618.415  Findings required.

    (a) Available funding. Before any payment of a job search allowance 
may be approved, the liable State (as defined in Sec.  618.110) must 
determine that job search funds are available for the fiscal year in 
which the job search activity takes place.
    (b) Findings by liable State. Before final payment of a job search 
allowance may be approved, the liable State must also:
    (1) Find that the worker meets the eligibility requirements for a 
job search allowance specified in Sec.  618.410(a)(1) through (b)(5) 
(eligibility for a job search allowance);
    (2) Find that the worker submitted the application for a job search 
allowance within the time limits specified in Sec.  618.405(c) 
(applying for a job search allowance); and
    (3) Verify that the worker made contacts with all employers to 
which the worker has been referred and must find that the worker 
completed the job search (as described in Sec.  618.410(b)) within the 
time limits stated in Sec.  618.410(a)(5) (eligibility for a job search 
allowance).
    (c) Assistance by agent State. (1) When a worker files an 
application for a job search allowance to conduct a job search in an 
agent State (as defined in Sec.  618.110), the cooperating State agency 
of the agent State in which the worker conducts the job search is 
responsible for assisting the worker in conducting the job search, and 
for assisting the liable State by furnishing to it any information 
required for the liable State's determination of the claim.
    (2) The agent State must cooperate fully with the liable State in 
carrying out its activities and functions with regard to such 
applications.


Sec.  618.420  Amount of a job search allowance.

    (a) Computation. The job search allowance is 90 percent of the 
total costs of each of the following (up to the limit in paragraph (b) 
of this section):
    (1) Travel. The more cost effective, reasonable mode of travel 
which cannot exceed the lesser of:
    (i) The actual cost of the most economical round trip travel by 
public transportation the worker reasonably can be expected to take 
between the worker's home and the job search area; or
    (ii) The prevailing cost per mile under the Federal travel 
regulations (41 CFR part 301-11) for roundtrip travel by the usual 
route from the worker's home to the job search area.
    (2) Lodging and meals. The worker's allowable lodging and meals 
costs, which cannot exceed the lesser of:
    (i) The actual cost for lodging and meals while engaged in the job 
search; or
    (ii) 50 percent of the prevailing per diem allowance under the 
Federal travel regulations for the worker's job search area.
    (b) Limit. The worker's total job search allowance under a 
certification may not exceed the statutory dollar limit, no matter how 
many job searches he or she undertakes. If the worker is entitled to be 
paid or reimbursed by another source for any of these travel, lodging 
and meals expenses, the job search allowance will be reduced by that 
amount.


Sec.  618.425  Determination and payment of a job search allowance.

    (a) Determinations. The cooperating State agency must promptly make 
and record determinations necessary to assure an adversely affected 
worker's eligibility to a job search allowance. Sections 618.825 
(determinations and notice) and 618.830 (appeals and hearings) of 
subpart H apply to these determinations. Copies of such applications 
and all determinations by the cooperating State agency must be included 
in the adversely affected worker's case record.
    (b) Payment. If the worker makes a timely application, is covered 
under a certification, and is otherwise eligible, the cooperating State 
agency must make payment as promptly as possible after the worker has 
completed a job search and complied with paragraph (d) of this section, 
provided that funds are available for job search allowances.
    (c) Advances. Once the cooperating State agency determines that the 
worker is eligible for a job search allowance, it may advance the 
worker 60 percent of the estimated amount of the job search allowance 
(subject to the limit of Sec.  618.420(b) (amount of a job search 
allowance)) not later than five days before the worker begins the job 
search. The advance must be deducted from any payment under paragraph 
(b) of this section.
    (d) Worker evidence. Once the worker has completed a job search, he 
or she must certify, on a form provided by the cooperating State 
agency, as to the employer contacts made and the daily lodging and 
meals expenses and transportation costs. The worker must provide 
receipts for all lodging and purchased transportation expenses during 
the job search. An adjustment must be made if the amount advanced is 
less or more than the amount to which the worker is eligible under this 
section.

[[Page 50807]]

Sec.  618.430  Job search program participation.

    (a) Requirements. An adversely affected worker who participates in 
an approved job search program (JSP), as defined in Sec.  618.110, may 
receive reimbursement for necessary expenses incurred for the worker's 
participation in the approved JSP, regardless of the worker's approval 
for or receipt of a job search allowance under Sec.  618.420 (amount of 
a job search allowance) and Sec.  618.425 (determination and payment of 
a job search allowance).
    (b) Approved JSP. A cooperating State agency may approve a JSP if:
    (1) The JSP is provided through the WIA, the public employment 
service, or any other Federal or State funded program, and complies 
with Sec.  618.110; or,
    (2) The JSP is sponsored by the firm from which the worker has been 
separated and complies with Sec.  618.110.
    (c) JSP allowances. Subsistence and transportation costs, whether 
inside or outside the worker's commuting area, must be approved for 
workers participating in JSPs in accordance with Sec.  618.640(c) and 
(d) (governing subsistence and transportation costs for workers in 
approved training) and within available State funding levels. Costs 
incurred may not exceed those allowable for training under Sec.  
618.640(c) and (d).

Subpart E--Relocation Allowances


Sec.  618.500  Scope.

    This subpart E sets forth the conditions under which an adversely 
affected worker may apply for and receive a relocation allowance to 
help the worker relocate to secure suitable employment outside the 
commuting area but within the United States.


Sec.  618.505  General.

    (a) A relocation allowance may be granted to an adversely affected 
worker to assist the worker and the worker's family to relocate within 
the United States. A relocation allowance may be granted to a worker 
only once under a certification.
    (b) A relocation allowance may not be granted to more than one 
member of a family for the same relocation. If more than one member of 
a family applies for a relocation allowance as an adversely affected 
worker for the same relocation, then the allowance must be paid to the 
family member who files first, if otherwise eligible.


Sec.  618.510  Applying for a relocation allowance.

    (a) Forms. To receive a relocation allowance, a worker must apply 
to the cooperating State agency, using the forms that such agency will 
furnish upon request.
    (b) Submittal. A worker who has a total or partial separation may 
apply to the cooperating State agency for a relocation allowance after 
a certification has been issued covering the worker. The worker must 
apply for a relocation allowance before the relocation begins.
    (c) Time limits. The worker must apply for a relocation allowance 
before the later of the following:
    (1) The 425th day after either the date of the certification under 
which the worker is covered or the worker's last total separation, 
whichever is later; or
    (2) The 182nd day after the date the worker concluded training, 
unless the worker received a waiver of the participation in training 
requirement, in which event this paragraph (c)(2) is inapplicable.


Sec.  618.515  Eligibility for a relocation allowance.

    (a) Conditions. To be eligible for a relocation allowance, the 
worker must:
    (1) File a timely application within the deadlines imposed by Sec.  
618.510(c) (applying for a relocation allowance);
    (2) Be an adversely affected worker totally separated from 
adversely affected employment when the relocation begins;
    (3) Not have already received a relocation allowance under the same 
certification;
    (4) Relocate within the United States but outside the worker's 
present commuting area;
    (5) Receive a determination by the cooperating State agency that 
the worker has no reasonable expectation of securing suitable 
employment (as defined in Sec.  618.110) in the commuting area (as 
defined in Sec.  618.110), and has obtained suitable employment 
affording a reasonable expectation of employment of a long-term 
duration, or a bona fide offer of such suitable employment, outside the 
commuting area and in the area of intended relocation; and
    (6)(i) Begin the relocation as promptly as possible after the date 
of certification but no later than:
    (A) 182 days after the worker applies for a relocation allowance, 
or
    (B) 182 days after the conclusion of an approved training program, 
if the worker entered a training program approved under Sec.  
618.640(c) and (d) (subsistence and transportation payments) for 
training outside the worker's commuting area;
    (ii) Complete the relocation (as described in Sec.  618.530(e) 
(determination and payment of a relocation allowance)) within a 
reasonable time as determined in accordance with Federal travel 
regulations with the cooperating State agency giving consideration to, 
among other factors, whether:
    (A) Suitable housing is available in the area of relocation;
    (B) The worker can dispose of the worker's residence;
    (C) The worker or a family member is ill; and
    (D) A member of the family is attending school, and if so, when the 
member can best be transferred to a school in the area of relocation.
    (b) Job search allowances. The cooperating State agency may not 
approve a relocation allowance and a job search allowance for a worker 
at the same time. However, if the worker has received a job search 
allowance, he or she may receive a relocation allowance at a later 
time.


Sec.  618.520  Findings required.

    (a) Available funding. Before any payment of a relocation allowance 
may be approved, the liable State (as defined in Sec.  618.110) must 
make a determination that relocation funds are available for the fiscal 
year in which the relocation activity takes place.
    (b) Findings by liable State. Before final payment of a relocation 
allowance may be approved, the liable State must make the following 
findings:
    (1) That the worker meets the eligibility requirements for a 
relocation allowance specified in Sec.  618.515(a)(1) to (6) and is not 
also receiving a job search allowance as specified in Sec.  618.515(b) 
(eligibility for a relocation allowance);
    (2) That the worker submitted the application for a relocation 
allowance within the time limits specified in Sec.  618.510(c) 
(applying for a relocation allowance);
    (3) That the worker began and completed the relocation within the 
time limitations specified in Sec.  618.515(a)(6) (eligibility for a 
relocation allowance); and
    (4) That the worker obtained suitable employment affording a 
reasonable expectation of employment of a long-term duration, or a bona 
fide offer of such suitable employment, in the area of intended 
relocation, in accordance with Sec.  618.515(a)(5) (eligibility for a 
relocation allowance). The liable State must verify (directly or 
through the agent State) the employment or bona fide offer with the 
employer.
    (c) Assistance by agent State. (1) When a worker relocates to an 
agent State (as defined in Sec.  618.110), the cooperating State agency 
of the agent State is responsible for:
    (i) Assisting the worker in relocating to the State, and in 
completing an

[[Page 50808]]

application for a relocation allowance with the liable State, and
    (ii) Assisting the liable State by furnishing to it any information 
required for the liable State's determination on the claim.
    (2) The agent State must cooperate with the liable State in 
carrying out its activities and functions with regard to relocation 
applications. When requested by the liable State, the agent State must 
verify with the employer and report to the liable State whether the 
worker has obtained suitable employment affording a reasonable 
expectation of employment of a long-term duration, or a bona fide offer 
of such suitable employment.


Sec.  618.525  Determining the amount of a relocation allowance.

    The worker's relocation allowance includes the following, as 
applicable:
    (a) Reimbursement. (1) Personal travel. The worker may be 
reimbursed for 90 percent of the following expenses related to personal 
travel:
    (i) The lesser of--
    (A) the most cost effective, reasonable travel expenses by public 
transportation for the worker and family from their old home to their 
new home; or
    (B) the prevailing cost per mile by privately owned vehicle under 
the Federal travel regulations (41 CFR part 301-11) for travel by the 
usual route from their old home to their new home.
    (ii) Separate travel, computed in accordance with paragraph 
(a)(1)(i) of this section, of a family member or members who, for good 
cause and with the approval of the cooperating State agency, must 
travel separately to their new home. For purposes of this paragraph 
(a)(1)(ii), good cause includes but is not limited to reasons such as a 
family member's health, schooling or economic circumstances.
    (2) Lodging and meals. The worker may be reimbursed for 90% of 
lodging and meal expenses for the worker and his or her family while 
they are in transit, but such costs may not exceed the lesser of:
    (i) The actual lodging and meals cost to the worker and his or her 
family while they are traveling; or
    (ii) 50 percent of the prevailing per diem allowance under the 
Federal travel regulations for the relocation area for those days while 
the worker and his or her family are traveling.
    (3) Movement of household goods. (i) The worker may be reimbursed 
for 90 percent of the allowable costs of moving the worker's and 
family's household goods and personal effects. This includes 90 percent 
of the costs of moving by the most economical commercial carrier the 
worker reasonably can be expected to use, moving by rental truck or 
trailer (for rental, mileage and fuel), or moving a house trailer or 
mobile home. It also includes 90 percent of the costs of temporary 
storage of household goods for up to 60 days. In approving the move of 
a house trailer or mobile home, the cooperating State agency must 
follow the specific requirements of the Federal travel regulations at 
41 CFR part 302-10.
    (ii) For a commercial carrier move of household goods or house 
trailer or mobile home, the worker must obtain an estimate of the 
moving cost and provide this to the liable State. The estimate may 
include the cost of insuring such goods and effects for their actual 
value or $40,000, whichever is less, against loss or damage in transit.
    (iii) If more economical, the cooperating State agency may make 
direct arrangements for moving and insuring a worker's household goods 
and personal effects with a carrier and insurer selected by the worker 
and may make payment of 90 percent of moving and insurance costs 
directly to the carrier and insurer. No such arrangement releases a 
carrier from liability otherwise provided by law or contract for loss 
or damage to the worker's goods and effects. The United States must not 
be or become liable to either party for personal injury or property 
loss damage under any circumstances.
    (iv) The maximum net weight of the household goods relocated from 
the worker's old home to the relocation area may not exceed that set by 
the Federal travel regulations (41 CFR Parts 301 through 304); and
    (4) Lump sum. As part of the relocation allowance, the worker will 
receive a lump sum payment equivalent to three times his or her average 
weekly wage, not to exceed the statutory dollar limit under section 
237(b)(2) of the Act or its successor provision.
    (b) Reduction. If the worker is eligible to receive or has received 
moving expenses from any other source for the same relocation, the 
amount received will be deducted from the amount of the relocation 
allowance as determined in paragraphs (a)(1), (a)(2) and (a)(3) of this 
section.
    (c) Limitation. In no case may the cooperating State agency pay a 
travel allowance for the worker or a family member more than once for a 
single relocation.


Sec.  618.530  Determinations and payment of a relocation allowance.

    (a) Determinations. The cooperating State agency must promptly make 
and record determinations necessary to assure a worker's eligibility to 
a relocation allowance. Sections 618.825 (determinations and notice) 
and 618.830 (appeals and hearings) of subpart H apply to these 
determinations. Copies of such applications and all determinations by 
the cooperating State agency must be included in the adversely affected 
worker's case record.
    (b) Payment. If the worker makes a timely application, is covered 
under a certification, and is otherwise eligible, the cooperating State 
agency must make payment as promptly as possible after the worker has 
completed the relocation.
    (c) Travel allowances. (1) The cooperating State agency must pay, 
in advance, by check payable to the worker, the allowances, computed 
under Sec.  618.525(a) (determining the amount of a relocation 
allowance), within 10 days before or at the time of the worker's 
scheduled departure to begin relocation. Payment for a family member 
approved for separate travel must be paid in advance within 10 days 
before or at the time of that family member's scheduled departure.
    (2) Worker Evidence. After a worker completes the relocation, he or 
she must certify on a State form the daily lodging and meals expenses. 
The worker must provide receipts for all lodging and purchased 
transportation expenses for the worker and family related to the 
relocation. If the advance the worker received was more or less than 
the actual allowance, an appropriate adjustment must be made.
    (d) Movement of Household Goods. The cooperating State agency must 
pay the amount equal to 90 percent of the estimate of the costs of 
moving the worker's household goods by the most economical commercial 
carrier the worker reasonably can be expected to use (as described at 
Sec.  618.525(a)(3) (determining the amount of a relocation allowance)) 
as follows:
    (1) Commercial carrier. If a commercial carrier moves the worker's 
household goods and personal effects, the cooperating State agency must 
provide the worker with an advance equal to 90 percent of the estimated 
cost of the move, including any other charges that the cooperating 
State agency has approved such as insurance. The funds must be advanced 
by check or checks payable to the carrier and insurer; the cooperating 
State agency must deliver the check to the worker within 10 days of, or 
at the time of, the scheduled shipment.
    (i) On completion of the move (as determined under paragraph (e) of 
this section), the worker must promptly

[[Page 50809]]

submit to the cooperating State agency a copy of the carrier's bill of 
lading, including a receipt showing payment of moving costs.
    (ii) If the amount the worker received as an advance is greater 
than 90 percent of the actual approved moving costs, he or she must 
reimburse the cooperating State agency for the difference. If the 
advance the worker received is less than 90 percent of the actual 
moving costs approved by the cooperating State agency, the cooperating 
State agency must reimburse the worker for the difference.
    (iii) If more economical, the cooperating State agency may make 
direct arrangements for moving and insuring a worker's household goods 
and personal effects with a carrier and insurer selected by the worker 
and may make payment of 90 percent of moving and insurance costs 
directly to the carrier and insurer subject to the condition of Sec.  
618.525(a)(3)(iii) (determining the amount of a relocation allowance).
    (2) Private truck and trailer, rental truck or trailer, or house 
trailer move. (i) Private vehicle with trailer. If the move is by 
private vehicle and trailer, 90 percent of the estimated cost for the 
use of the private vehicle must be made by check payable to the worker 
and must be delivered within 10 days of the scheduled move.
    (ii) Truck and trailer rental. If the move is by rental truck or 
rental trailer, 90 percent of the estimated rental cost must be 
advanced by check payable to the worker or the rental agency and must 
be delivered to the worker within 10 days of the scheduled move.
    (iii) House trailer. If a house trailer or mobile home is moved by 
commercial carrier, 90 percent of the approved estimated cost must be 
advanced by check payable to the worker or the carrier, and must be 
delivered to the worker within 10 days of the scheduled move.
    (iv) On completion of the move, the worker must promptly submit a 
receipt to the cooperating State agency itemizing and evidencing 
payment of the rental charges for the rental trailer and fuel costs, or 
for the rental truck and trailer and fuel costs, or for the actual 
charges for the house trailer or mobile home move. If the amount the 
worker received as an advance is greater than 90 percent of the actual 
approved moving costs, he or she must reimburse the cooperating State 
agency for the difference. If the advance the worker received is less 
than 90 percent of the actual moving costs approved by the cooperating 
State agency, the cooperating State agency must reimburse the worker 
for the difference.
    (3) Temporary storage. If temporary storage, not to exceed 60 days, 
of household goods and personal effects is necessary and incident to 
transportation of the household goods for the relocation, then 90 
percent of the approved estimated cost must be advanced by check 
payable to the worker or the rental agency and must be delivered to the 
worker within 10 days of the scheduled move.
    (e) Lump sum allowance. The lump sum allowance provided in Sec.  
618.525(a)(4) (determining the amount of a relocation allowance) must 
be paid when arrangements for the relocation are finalized, but not 
more than 10 days before the earlier of the worker's anticipated 
departure from his or her old home or the anticipated date of shipment 
of the worker's household goods and personal effects.
    (f) Relocation completed. A worker completes a relocation when the 
worker and family, if any, along with household goods and personal 
effects are delivered to the new residence in the area of relocation or 
to temporary storage. If no household goods and personal effects are 
moved, then a worker completes a relocation when the worker and family, 
if any, arrive in the area of relocation and establish a residence in 
the new area. When a family member is approved for separate travel, the 
later arrival of such family member does not alter the date the 
relocation was completed.

Subpart F--Training Services


Sec.  618.600  Scope.

    This subpart covers approval of training for an adversely affected 
worker. The purpose of an approved training program is to assist an 
adversely affected worker to obtain skills that will lead them to work 
that will use their highest skill levels, including those gained in the 
training program, and pay the highest wages given the workers' 
preexisting skill levels and education and the condition of the labor 
market, and to do so as quickly as possible.


Sec.  618.605  Procedures.

    (a) Comprehensive Assessment. The cooperating State agency must 
ensure that every worker has a comprehensive assessment leading to the 
development of an IEP, as described in subpart C, before an application 
for training can be approved.
    (b) Applications. (1) Applications for approval of training, 
including requests for TAA-funded transportation and subsistence 
payments, must accord with this subpart F and be documented on forms 
which the cooperating State agency must furnish to individuals.
    (2) A bona fide application for training under this subpart F must 
contain the information specified in Sec.  618.110 and must be signed 
and dated by a cooperating State agency representative upon receipt.
    (c) Determinations. Selection for, approval of, or referral of a 
worker to training, including TAA-funded transportation and subsistence 
payments, under this subpart F, or a decision with respect to any 
specific training or non-selection, non-approval, or non-referral for 
any reason is a determination to which Sec.  618.825 (determinations 
and notice), Sec.  618.830 (liable and agent State responsibilities) 
and Sec.  618.835 (appeals and hearings) of subpart H apply. Copies of 
such applications and all determinations by the cooperating State 
agency whether to approve or deny the training, including TAA-funded 
transportation and subsistence payments, must be included in the 
adversely affected worker's case record.
    (d) Linkages for training opportunities. It is the responsibility 
of the cooperating State agency to explore, identify, and secure 
training opportunities and to establish linkages with other public and 
private agencies, as described in Sec.  618.325 (integrated service 
strategies to ensure that a comprehensive array of services are 
provided by WIA or other programs), which can provide training that 
maximizes the potential of adversely affected workers to return to 
employment as soon as possible. A cooperating State agency is not 
required to create new training programs or develop new curricula where 
none currently exist.


Sec.  618.610  Criteria for approval of training.

    The cooperating State agency must consult the worker's 
comprehensive assessment and IEP, as described respectively under Sec.  
618.345 and Sec.  618.350, before approving an application for 
training. Training must be approved for an adversely affected worker if 
the cooperating State agency determines all of the following six 
criteria are met:
    (a) Criterion 1: There is no suitable employment available for the 
adversely affected worker. (1) There is no suitable employment, as 
defined at Sec.  618.110 (which may include technical and professional 
employment), available for an adversely affected worker either in the 
commuting area, as defined in Sec.  618.110, or outside the commuting

[[Page 50810]]

area in an area to which the worker desires to relocate with the 
assistance of a relocation allowance under subpart E of this Part, and 
there is no reasonable prospect of such suitable employment becoming 
available for the worker in the foreseeable future. Notification of a 
specific recall, as described in Sec.  618.725(b)(1) (waiver of 
training requirement for basic TRA), to adversely affected employment 
by the worker's firm in the same or essentially the same job is 
considered suitable employment if the recall is expected to be 
permanent, and the worker's application for training must be denied.
    (2) ``No reasonable prospect of such suitable employment in the 
foreseeable future'' means that the worker does not have a likely 
prospect of being recalled to the adversely affected employment and an 
assessment of the worker's skills and local labor market indicators, or 
local labor market indicators in the area where the worker desires to 
relocate, does not provide evidence of suitable employment being 
available in the foreseeable future.
    (3) If an application for training is denied under paragraph (a)(1) 
of this section, the cooperating State agency must document the 
availability of suitable employment through local labor market 
information or job orders.
    (b) Criterion 2: The worker would benefit from appropriate 
training. (1) The worker would benefit from appropriate training when a 
direct relationship exists between the worker's need for skills 
training or remedial education in order to increase the likelihood of 
obtaining suitable employment and those skills or remediation that 
would be provided by the training program under consideration for the 
worker. It also means that the training is expected to improve the 
worker's chances of obtaining and retaining sustainable employment at 
higher wages than would have been obtained in the absence of training;
    (2) The worker must also have the knowledge, skills, and abilities 
to undertake, make satisfactory progress in, and complete the training.
    (3) The cooperating State agency may not approve training for a 
worker that would result in seasonal employment, unless the duration 
and minimum compensation of such employment meets the criteria for 
employment that will lead to self-sufficiency set by the State 
Workforce Investment Board or the Local Workforce Investment Board for 
the local workforce investment area under 20 CFR 663.230.
    (c) Criterion 3: There is a reasonable expectation of employment 
following completion of such training. A reasonable expectation of 
employment following completion of such training means that, given the 
job market conditions expected to exist at the time of the completion 
of the training program, a reasonable expectation, fairly and 
objectively considered, exists that the worker is likely to find a job 
that will allow the worker to achieve self-sufficiency. Self-
sufficiency is judged in accordance with criteria established by the 
State Workforce Investment Board or the Local Workforce Investment 
Board for the local workforce investment area under 20 CFR 663.230 
using the skills and education acquired while in training, after 
completion of such training. The job market conditions considered must 
be limited to those in the worker's commuting area, as defined in Sec.  
618.110, or in an area where the worker desires to relocate with the 
assistance of a relocation allowance under subpart E of this part.
    (1) Any determination under this criterion must take into account 
that ``a reasonable expectation of employment'' does not require that 
employment opportunities for the worker be available, or offered, 
immediately upon the completion of the approved training. This 
criterion emphasizes that, when initially approving such training, 
there must be a fair and objective projection of job market conditions 
expected to exist at the time of completion of the training. This 
criterion recognizes that new employment occurs on employers' time 
schedules that may not coincide with the time of the completion of the 
training.
    (2) The cooperating State agency may measure expected job market 
conditions using the list of high growth and demand occupations 
maintained by the Local Workforce Investment Board (which is based in 
part on pertinent labor market data, including job order activity where 
appropriate), or by contacting the local and State economic development 
agencies for information about jobs requiring training that may not 
already exist in the local workforce investment area but which have a 
reasonable prospect of soon becoming available.
    (3) When a worker desires to relocate within the United States but 
outside the worker's present commuting area upon completion of 
training, the cooperating State agency must obtain documentation (such 
as telephone contact notes, copies of e-mail communications, or written 
statements or a facsimile copy) of labor market information in the area 
in which relocation is planned to support the determination that a 
reasonable expectation of employment exists within the area of the 
planned relocation.
    (4) A reasonable expectation of employment may exist in a limited 
demand occupation for a single, trained worker in an occupation that 
occurs in exceptionally limited numbers in the worker's commuting area 
(such as, a taxidermist or antique doll restorer) but is one in which 
the worker has expressed a desire for training. Such an occupation 
ordinarily will not appear on a list of high-growth and demand 
occupations. A limited demand for such an occupation does not preclude 
the development of an IEP that includes such an occupational training 
program, but the cooperating State agency must determine that there is 
a reasonable expectation that the worker can find employment in the 
occupation. Cooperating State agencies must require that an employer 
interested in hiring such a trained person provide evidence of an 
intent to hire the worker upon successful completion of approved 
training which provides documentation in the IEP that an employment 
opportunity is expected to be available.
    (5) A cooperating State agency may approve training in an 
occupation if it finds that there is a reasonable expectation that the 
training will lead to a reasonable prospect of self employment in the 
occupation for which the worker requests training.
    (d) Criterion 4: Training approved by the Secretary is reasonably 
available to the worker from either governmental agencies or private 
sources (which may include area vocational education schools and 
employers). This criterion means that training is reasonably accessible 
to the worker at any governmental or private training (or education) 
provider. Training may be institutional training, on-the-job training 
or customized training with employers. This criterion also means that 
emphasis must be given to finding accessible training for the worker in 
the commuting area, although it does not preclude approving training 
outside the commuting area if none is available at the time within the 
worker's commuting area. Whether the training is within or outside the 
commuting area, the training must be available at a reasonable cost as 
prescribed in paragraph (f) of this section. Sources of approved 
training may include those described in Sec.  618.620 (selection of 
training programs).
    (e) Criterion 5: The worker is qualified to undertake and complete 
such training. This means the worker is qualified to undertake and 
complete such training, as follows:

[[Page 50811]]

    (1) Evaluation of the worker's qualifications must determine that 
the worker's knowledge, skills, and abilities, educational background, 
work experience and financial resources, are adequate to undertake and 
complete the specific training program being considered. The 
cooperating State agency must consult the adversely affected worker's 
comprehensive assessment or IEP developed in accordance with subpart C 
of this part in determining whether the worker is qualified to 
undertake and complete the training.
    (2) The worker must have sufficient personal or family resources on 
which to live to allow completion of the training within the time 
limits in Sec.  618.615(a)(3) (limitations on approval of training). 
(i) In making this determination, the cooperating State agency must 
consider:
    (A) The worker's remaining weeks of UI and TRA payments in relation 
to the duration of the selected training program;
    (B) Other sources of income support available to the worker 
including severance, earnings of other family members, and other family 
resources;
    (C) Other fixed financial obligations and expenses of the worker 
and family;
    (D) The availability of Federal student financial assistance as 
defined in Sec.  618.110 or any State-funded student financial 
assistance; and
    (E) If applicable, the worker's employment situation while 
attending training.
    (ii) Before approving a TAA training program, the cooperating State 
agency must document that financial resources were discussed with the 
worker and a determination made that the worker had adequate personal 
or family resources along with UI and/or TRA payments to allow for the 
completion of training.
    (iii) When a worker has inadequate financial resources to complete 
a selected TAA training program regardless of whether it exceeds the 
duration of UI and TRA payments, then that training must not be 
approved and consideration must be given to other training 
opportunities or related workforce development programs' assistance 
available to the worker.
    (f) Criterion 6: Such training is suitable for the worker and 
available at a reasonable cost. (1) Suitable for the worker. Suitable 
for the worker means that the training being considered meets the 
criteria in paragraph (e) of this section and that the training is 
appropriate for the worker given the worker's knowledge, skills, and 
abilities, background and experience.
    (2) Available at a reasonable cost. (i) Costs of a training program 
include tuition and related expenses (books, tools, uniforms and other 
training-related clothing including goggles and work boots, laboratory 
fees and other academic fees required as part of the approved training 
program), subsistence expenses and travel expenses (described in Sec.  
618.640(c) and (d) (subsistence and transportation expenses)). Under no 
circumstances may the costs of a training program include the payment 
for personal computer equipment for a worker to own, even when it is a 
prerequisite for a worker's training program, although cooperating 
State agencies may purchase personal computer equipment and then lend 
it to those workers who require it for their training; if a worker 
lacks sufficient access to such computer equipment, then the training 
program must not be approved. Cooperating State agencies must pay the 
costs of initial licensing and certification tests and fees where a 
license or certification is required for employment.
    (ii) The cooperating State agency must give first consideration to 
the lowest cost training for the occupation that is available in the 
worker's commuting area, if that training is of sufficient quality, 
content, and expected outcome to meet the worker's occupational goal as 
reflected in the IEP. The cooperating State agency may approve higher 
cost training if that training is expected to be of demonstrably higher 
quality, content or expected outcomes, or to achieve comparable results 
in a significantly shorter duration.
    (iii) Training in a selected occupational area may not be approved 
if:
    (A) It requires an extraordinarily high skill level; and
    (B) The total costs of the training are substantially higher than 
the costs of other types of training that are suitable for the worker.
    (iv) Training at facilities outside the worker's commuting area 
requiring transportation or subsistence payments which add 
substantially to the total costs may not be approved if other 
appropriate training in the commuting area is available at a lower 
cost.
    (v) A training program may not be approved if the cost exceeds the 
limit on the amount of training per worker set by the cooperating State 
agency, except as permitted under Sec.  618.650 (State training cost 
caps).


Sec.  618.615  Limitations on approval of training.

    (a) Length of training. The cooperating State agency, in 
determining whether to approve training, must determine the 
appropriateness of the length of training, as follows:
    (1) The training must be of suitable duration to achieve the 
desired skill level to facilitate employment in the selected occupation 
in the shortest possible time.
    (2) Factors that may affect the workers' participation in training, 
including employment (full- or part-time) under Sec.  618.630 (training 
of reemployed workers not in suitable employment), availability of 
childcare, and the course schedule of the selected training 
institution, must be considered.
    (3) Duration. (i) The maximum duration for any approvable training 
program is 104 consecutive calendar weeks, and up to 26 additional 
calendar weeks, as needed, for a worker to complete approved remedial 
education (as discussed in Sec.  618.755 (qualifying requirements for 
TRA)) for a total not to exceed 130 consecutive calendar weeks.
    (ii) If a training program meets the duration requirements of 
paragraph (a)(3)(i) of this section, but will extend beyond the period 
in which TRA is available, the cooperating State agency must determine, 
under Sec.  618.610(e)(2) (criteria for approval of training), that the 
worker has sufficient personal resources to complete the training.
    (iii) The cooperating State agency must consult the adversely 
affected worker's comprehensive assessment and IEP, as discussed in 
Sec.  618.345 (comprehensive assessment) and Sec.  618.350 (IEPs), when 
determining the length of remedial education the worker needs to return 
to employment. This paragraph does not preclude the cooperating State 
agency from approving a training program consisting entirely of 
remedial education when it is determined to be appropriate for the 
worker as long as it is consistent with, in particular, Sec.  
618.610(c) (criteria for approval of training) that there is a 
reasonable expectation of sustainable employment following completion 
of training.
    (4) Exception for certain workers who perform service in the 
Uniformed Services. A member of one of the Reserve components of the 
U.S. Armed Forces means the Army Reserve; Air Force Reserve; Naval 
Reserve; Marine Corps Reserve; Coast Guard Reserve; Army and Air 
National Guard when performing duty under Federal authority. A member 
of one of the Reserve components of the U.S. Armed Forces ordered to 
perform active duty service in the uniformed services will have the 
period for training, under paragraph (a)(3) of this section, suspended 
upon being called up to

[[Page 50812]]

duty, provided the requirements specified in paragraphs (a)(4)(i) 
through (v) of this section are met. Such a Reserve component member 
may either resume training upon discharge from active service for 
whatever training period still remains from the point when the 
Reservist left training for active duty, or be allowed to repeat 
portions of the training if doing so is necessary for completion of the 
approved training program, or, where appropriate, begin a new approved 
training program. Where the Reservist repeats a training program or 
begins a new training program, the Reservist will be entitled to a new 
104-consecutive calendar week period, and up to an additional 26 
calendar weeks, as needed, to complete approved remedial education (as 
discussed in Sec.  618.755), for a total not to exceed 130-consecutive 
calendar weeks. To be eligible to resume, repeat, or begin a new 
approved training program, the Reservist must meet the following 
requirements:
    (i) The active duty service must be under competent Federal orders 
and must be involuntary service in support of: a war or national 
emergency declared by the President or the Congress; an operational 
mission; a critical mission or requirement of the uniformed services; 
or other contingencies for which an involuntary activation is deemed 
necessary.
    (ii) The worker must give prior oral or written notice of the 
active duty service to the cooperating State agency, unless the giving 
of notice is precluded by military necessity or is otherwise impossible 
or unreasonable.
    (iii) The worker must not have:
    (A) received a dishonorable or bad conduct discharge;
    (B) received a separation under other than honorable conditions;
    (C) received a dismissal under section 10 U.S.C. 1161(a); or
    (D) been dropped from the rolls under 10 U.S.C. 1161(b).
    (iv) The worker must apply to the cooperating State agency for 
training within 90 days following release from active duty service, as 
described in Sec.  618.605(b)(2) (procedures) above. The application 
may be oral or written.
    (v) Upon request of the cooperating State agency, the worker must 
provide documentation that the worker has not received a dishonorable 
or other disqualifying discharge upon release from active duty service 
as described in paragraph (a)(4)(iii) of this section.
    (b) Amending approved training. The cooperating State agency may, 
with the approval of the worker, amend a worker's approved training 
program under the following conditions:
    (1) The cooperating State agency determines after reviewing and 
amending the worker's IEP that--
    (i) A course or courses designed to satisfy unforeseen needs of the 
worker, such as remedial education or new employer skill requirements, 
are necessary;
    (ii) The originally approved training program cannot be 
successfully completed by the worker;
    (iii) The originally approved training program is determined to be 
of poor quality; or
    (iv) Training in another occupation will lead to a better outcome.
    (2) The proposed training program meets the criteria for approval 
of training at Sec.  618.610 (criteria for approval of training), and, 
specifically, the costs for the amended training program continue to 
meet the reasonable cost requirement of Sec.  618.610(f).
    (3) The amended training program and the originally approved 
training program combined do not exceed the 104-week limitation, or the 
130-week limitation when remedial education is part of the training 
program, on the duration of training.
    (c) One approved training program per certification. Except as 
provided under paragraphs (a)(4) and (b) of this section, no worker may 
receive more than one approved training program under a single 
certification.
    (d) Full-time or part-time training. A cooperating State agency may 
approve a training program on a full-time or part-time basis.
    (1) Full-time. Full-time training means that the hours in a day and 
days in a week of attendance in training are full-time in accordance 
with the established hours and days of the training provider. If a 
worker in full-time training has obtained employment (which is not 
suitable employment as defined in Sec.  618.110, then the worker may 
choose to continue with such employment if the worker is willing and 
able to accommodate a full-time training schedule under the training 
institution's standard for full-time training.
    (2) Part-time. (i) A cooperating State agency may approve part-time 
training when the worker has employment which is not suitable 
employment, or may amend an approved training program from full-time to 
part-time if a worker obtains employment which is not suitable 
employment and the worker wants to accept or continue with such 
employment. A cooperating State agency may also approve part-time 
training for partially separated workers. In such instances, the time 
limits under paragraph (a)(3) of this section will continue to apply 
for receipt of training and TRA (if applicable). Participants seeking 
approval to attend training on a part-time basis must be employed on at 
least a part-time basis in employment as defined under the State law of 
the State in which the worker is employed. The combination of part-time 
employment and part-time training must represent at least the 
equivalent of full-time employment as defined by State law. The 
training approval requirements of Sec.  618.610 (criteria for approval 
of training) apply to part-time training. In particular, the 
cooperating State agency must assure, before approving part-time 
training or the amendment of an approved training program from a full-
time to a part-time basis, that the program provides the worker with a 
reasonable expectation of employment following completion of the 
training program.
    (ii) If the hours of work are reduced so that the combination of 
part-time employment and part-time training no longer represent the 
equivalent of full-time employment, the worker may complete that 
session or semester. However, the training approval must be rescinded 
beginning with the next session or semester, unless the combination of 
part-time employment and part-time training represents the equivalent 
of full-time employment by the start of the next session or semester.
    (iii) The cooperating State agency must ensure that the worker, if 
choosing to engage in part-time employment and part-time training, is 
informed of the possible negative effects on UI and other TAA benefits, 
including loss of the HCTC. The cooperating State agency must require a 
worker to sign a statement (for inclusion in the worker's case file) 
establishing that the worker has been informed of the potential for 
reduced benefits.
    (e) Previous approval of training under other law. Training 
previously approved for a worker under another State or Federal law or 
other authority is not training approved under Sec.  618.610. Any such 
training may be approved under Sec.  618.610 (criteria for approval of 
training), if it meets all of the requirements and limitations of Sec.  
618.610 and the other provisions of this subpart F, but such approval 
may not be retroactive for any of the purposes of this Part 618, 
including payment of the costs of the training and payment of TRA to 
the worker participating in the training. However, in the case of a 
redetermination or decision reversing a determination denying approval 
of training, the redetermination or decision must be given effect 
retroactive to the issuance

[[Page 50813]]

of the determination that was reversed; but no costs of training may be 
paid unless such costs actually were incurred for training in which the 
individual participated, and no basic nor additional TRA may be paid 
with respect to any week the individual was not actually participating 
in the training.
    (f) Training outside the United States. In no case may a worker be 
approved for training under this subpart F that is conducted totally or 
partially at a location outside the United States.


Sec.  618.620  Selection of training program.

    (a) Standards and procedures for selection of training. Cooperating 
State agencies must document the standards and procedures used to 
select training providers and training programs in which training is 
approved. The following provisions apply to the selection of a training 
program other than OJT, customized training, or training in limited 
demand occupations:
    (1) Cooperating State agencies may only approve training for an 
adversely affected worker if the training is provided by an eligible 
training provider under WIA, except as provided in paragraphs (a)(2) 
and (a)(3) of this section.
    (2) Cooperating State agencies must follow the applicable 
requirements under WIA to approve requested training from a provider 
that is not an eligible training provider.
    (3) Cooperating State agencies may approve training in limited 
demand occupations with a provider that has not been approved as an 
eligible training provider if the provider meets the requirements 
described at Sec.  618.610(c)(4).
    (b) Methods of training. Eligible adversely affected workers must 
be provided training using either one or a combination of the following 
methods:
    (1) Firm-specific retraining program. To the extent practicable and 
before referring a worker to approved training, the cooperating State 
agency must consult with the adversely affected worker's firm and 
certified or recognized union, or other authorized representative, to 
identify if there is suitable employment at the worker's firm for which 
the worker can be retrained. If such suitable employment is identified, 
the cooperating State agency must determine whether there is training 
available that meets the firm's staffing needs and preserves or 
restores the employment relationship between the worker and the firm. 
That other employers in the area have no need for workers in a specific 
occupation for which training is undertaken does not preclude approval 
of a training program for such occupation with the adversely affected 
worker's firm.
    (2) In the event that firm-specific retraining is not practical, 
preference should be given to on-the-job training under Sec.  618.635 
(enrollment in OTJ and customized training), which may include related 
education necessary to acquire skills needed for a position within a 
particular occupation, in the firm or elsewhere. In determining whether 
to approve on-the-job training, the cooperating State agency must 
consider the six criteria in Sec.  618.610 (criteria for approval of 
training), the availability of on-the-job opportunities and the 
worker's need for remedial education, and inform the worker of the 
effect of such training on eligibility for HCTC;
    (3) Customized training; and
    (4) Institutional training, with priority given to providing the 
training in public area vocational and technical education schools, as 
well as community colleges, if it is determined that such schools are 
at least as effective and efficient as other institutional 
alternatives. This also includes distance learning where a worker may 
complete all or part of an educational or vocational program in a 
geographical location apart from the institution hosting the training 
program, and where the final certificate or degree conferred is 
equivalent in standard of achievement and content to the same program 
completed on campus or at another institutional training location.
    (c) Other training. In addition to the training programs discussed 
in paragraph (b) of this section, training programs that may be 
approved under Sec.  618.610 (criteria for approval of training) 
include, but are not limited to--
    (1) Any program of remedial education, including adult basic 
education courses and other remedial education courses, English as a 
Second Language (ESL) courses, and General Equivalency Diploma (GED) 
preparation courses offered through community colleges or other 
training vendors;
    (2) Vocational and technical education and apprenticeships;
    (3) Any training program approvable under Sec.  618.610 for which 
all, or any portion, of the costs of training the worker are paid--
    (i) Under any other Federal or State program other than this 
subpart F, or
    (ii) From any source other than this part; and
    (4) Any other training program approved by the Department.


Sec.  618.625  Payment restrictions for training programs.

    The cooperating State agency must (subject to the cap on training 
funds under section 236(a)(2)(A) of the Act) provide for payment of the 
costs of an adversely affected worker's training approved under Sec.  
618.610 (criteria for approval of training) as provided in this 
section. The Department may use a formula to distribute to States 
training funds for adversely affected workers.
    (a) Funding of training programs. The costs of a training program 
approved under the Act may be paid--
    (1) Solely from TAA funds,
    (2) Solely from other public or private funds (except as prohibited 
in paragraph (d) of this section), or
    (3) Partly from TAA funds and partly from other public or private 
funds (except as prohibited in paragraph (d) of this section).
    (b) No duplication of costs allowed. (1) Any use of TAA funds to 
duplicate the payment of training costs in any circumstances is 
prohibited.
    (2) Procedures. When the direct costs of a training program 
approvable under Sec.  618.610 (criteria for approval of training) are 
payable from TAA funds and are also wholly or partially payable from 
any other source, the cooperating State agency must establish 
procedures that ensure TAA funds will not duplicate funds available 
from the other source(s), but this preclusion of duplication does not 
prohibit and must not discourage sharing of costs under prearrangements 
authorized under paragraph (c)(2) of this section.
    (c) Cost sharing permitted. (1) Sharing the future costs of 
training is authorized where prior costs were paid from another source, 
but this paragraph (c)(1) does not authorize reimbursement from TAA 
funds of any training costs which were incurred, and for which payment 
became due, before the approval of the training program under Sec.  
618.610 (criteria for approval of training).
    (2) Prearrangements and agreements. (i) Where training costs are 
shared between the TAA program and any other source, the cooperating 
State agency must enter into a prearrangement with the other funding 
source to agree upon the mix of TAA funds and other funds to be used to 
pay the costs of a training program approved under Sec.  618.610 
(criteria for approval of training). A prearrangement must be a 
specific, binding agreement from the other sources to pay the costs 
they agree to assume, and must be entered into before any TAA funds are 
obligated. If, after TAA funds are committed to a training program, 
other funds become available to pay for that training, the

[[Page 50814]]

cooperating State agency must enter into an agreement with the other 
funding source specifying how the training program will be funded.
    (ii) Before approving any training program under subpart F of this 
part, which may involve the sharing of training costs under the 
authority of paragraph (a)(3) of this section, the cooperating State 
agency must require the worker to enter into a written agreement with 
the cooperating State agency, under which TAA funds will not be applied 
for or used to pay any portion of the costs of the training the worker 
has reason to believe will be paid by any other source.
    (3)(i) A cooperating State agency may not take into account, in 
determining whether training costs are payable from TAA funds, any 
payments to the worker under any other Federal law, such as Federal 
student financial assistance as defined in Sec.  618.110, which may 
have the effect of indirectly paying all or a portion of the training 
costs.
    (ii) If payments of Federal student financial assistance and other 
training allowances from other Federal funding sources are made to the 
training provider instead of the worker and are used for training 
costs, then such payments must be taken into account as direct payment 
of the training costs under another Federal law for purposes of this 
section.
    (d) No training fees or costs to be paid by worker from TAA funds. 
(1) A training program must not be approved under the Act if--
    (i) All or a portion of the costs of such training program are paid 
under any nongovernmental plan or program; and
    (ii) The adversely affected worker has a right to obtain training 
or funds for training under such plan or program; and
    (iii) Such plan or program requires the worker to reimburse the 
plan or program from funds provided under the Act, or from wages paid 
under such training program, for any portion of the costs of such 
training program paid under the plan or program.
    (2)(i) No training program may be approved under Sec.  618.610 
(criteria for approval of training) if the worker is to, or may, pay 
any of the costs of a training program from any other funds belonging 
to the worker from any source, except as provided in paragraph 
(d)(2)(ii) of this section.
    (ii) When the Director determines that all available funds under 
section 236(a)(2)(A) of the Act have been allocated, the Director will 
promptly publish a notice in the Federal Register announcing that 
determination. A cooperating State agency must then seek funding from 
other sources (other than from adversely affected workers), including 
WIA national emergency grants for dislocated workers under 20 CFR part 
671, to cover the costs of training approved under Sec.  618.610. To 
the extent that a cooperating State agency is unable to fund training 
costs from those other sources, the agency may approve training under 
Sec.  618.610 where the worker pays those unfunded costs. Where the 
worker chooses to pay those unfunded costs, the cooperating State 
agency is not liable for paying those costs. Where the worker chooses 
not to pay the unfunded costs, the cooperating State agency must waive 
the training requirement on the basis that training is not available, 
in order to preserve any remaining basic TRA eligibility under Sec.  
618.725(b)(6) (waiver of training requirement for basic TRA).
    (iii) If an employer or other entity agrees to fund training costs 
under conditions that may make the worker liable for all or a portion 
of those costs under certain conditions, the cooperating State agency 
may, if the training is otherwise approvable, contract with the 
employer or other entity to assume any unfunded costs on the worker's 
behalf.


Sec.  618.630  Training of reemployed workers not in suitable 
employment.

    (a) An adversely affected worker who obtains new employment that is 
not suitable employment, as defined in Sec.  618.110, and has been 
approved for training under Sec.  618.610 (criteria for approval of 
training) may elect to terminate the job, reduce the hours worked in 
the job, or continue in full- or part-time employment. Such a worker 
must not be subject to ineligibility or disqualification for UI or TRA 
as a result of such termination or reduction in employment. A worker 
who continues such full- or part-time employment while undertaking 
training is considered to be in training under Sec.  618.765(b) 
(disqualifications). If the worker continues in full- or part-time 
employment that is not suitable employment while undertaking approved 
training, the cooperating State agency must inform the worker in 
writing that such employment may have negative effects on UI and other 
TAA benefits due to disqualifying income, which could also include the 
possible loss of the HCTC.
    (b) An adversely affected worker described in paragraph (a) of this 
section may also be eligible for job search and relocation allowances.


Sec.  618.635  Enrollment in on-the-job and customized training.

    (a) On-the-job training (OJT). (1) Description. On-the-job training 
is training provided by an employer to an adversely affected worker who 
has been hired by the employer. OJT is conducted while the worker is 
engaged in productive work in a job that provides knowledge or skills 
essential to the full and adequate performance of the job. OJT is 
provided under a contract with an employer in the public or private 
sector.
    (2) Related education. In providing OJT, the cooperating State 
agency, insofar as possible, must ensure the provision of related 
education necessary for the acquisition of skills needed for a position 
within the occupational goal in the worker's IEP. Such related skills 
training may be provided as part of the on-the-job training contract or 
separately. Classroom training (also known as vestibule training) 
sponsored by the employer may be provided prior to or in conjunction 
with OJT to ensure the participant has sufficient working vocabulary 
and concepts of the employer's industry or firm, or has a basic 
understanding of such things as applicable safety rules and regulations 
prior to on-site training. Such training may be provided at the 
employment site or at educational institutions or other locations. Such 
classroom or vestibule training may be conducted for a portion of the 
day, to be followed by on-site OJT.
    (3) Duration. The worker's IEP and the OJT contract with the 
employer must specify the duration of the OJT. The duration of the OJT 
must be appropriate to the occupational goal for which the adversely 
affected worker is being trained, taking into account the content of 
the training, the worker's prior work experience, and the worker's 
skills as documented in the IEP. The duration of the training must 
allow enough time for the worker to become sufficiently proficient in 
the occupation for which the training is being provided to enable the 
worker to perform as well as workers in comparable positions within the 
firm.
    (4) Reimbursement. (i) Under an OJT contract, the employer may be 
reimbursed not more than 50 percent of the worker's wage rate for a 
maximum 40-hour work week (including hours spent in classroom or 
vestibule training conducted by the employer or the employer's 
representatives) for the cost of providing the training and additional 
supervision related to the OJT.
    (ii) The reimbursement for OJT must be limited to the duration of 
approved training as specified in the OJT contract.

[[Page 50815]]

    (5) Approval of the Costs of OJT. OJT costs for an adversely 
affected worker may be approved by a cooperating State agency only if a 
determination is made that:
    (i) No currently employed individual is displaced (including a 
partial displacement, such as a reduction in the hours of non-overtime 
work, wages, or employment benefits) by the adversely affected worker;
    (ii) Such training does not impair existing contracts for services 
or collective bargaining agreements;
    (iii) In the case of training that would be inconsistent with the 
terms of a collective bargaining agreement, written concurrence has 
been obtained from the concerned labor organization;
    (iv) No other individual is on layoff from the same or any 
substantially equivalent job for which the adversely affected worker is 
being trained;
    (v) The employer has not terminated the employment of any regular 
employee or otherwise reduced the workforce with the intention of 
filling the vacancy created by hiring the adversely affected worker;
    (vi) The job for which the adversely affected worker is being 
trained is not being created in a promotional line that will infringe 
in any way upon the promotional opportunities of currently employed 
individuals;
    (vii) The training is not for the same occupation from which the 
adversely affected worker was separated and with respect to which such 
worker's group was certified; and
    (viii) The employer has not received payment under the TAA program 
or under any other Federal law for any other OJT provided by such 
employer which failed to meet the requirements of paragraphs (a)(5)(i) 
through (a)(5)(vi) of this section or the requirements of the other 
Federal laws governing employment practices.
    (6) Payment of the costs of OJT. The costs of OJT that are paid 
from TAA funds must be paid in equal monthly installments. To meet the 
requirement that payments be made in equal monthly installments, a 
cooperating State agency must either pay OJT costs in equal monthly 
dollar amounts or, alternatively, compute the monthly payments at the 
same rate. For the latter, payments based upon the number of hours of 
paid work up to a maximum of 40 hours a week during the month and then 
multiplied by the agreed-upon rate of payment are equal monthly 
installments in that the payment for each month is computed at the same 
rate.
    (7) Under Sec.  618.765(c), an adversely affected worker may not be 
paid TRA for any week during which that worker is in OJT and, 
therefore, may be ineligible for the HCTC.
    (b) Customized training. Customized training may be conducted by a 
training vendor, and is training that is:
    (1) Designed to meet the special requirements of one or more 
employers;
    (2) Conducted with a commitment by the employer(s) to employ an 
adversely affected worker upon successful completion of the training; 
and
    (3) For which the employer(s) pay(s) for a significant portion (but 
in no case less than 50 percent) of the cost of such training as 
determined by the cooperating State agency and consistent with similar 
policies established under WIA by the State Workforce Investment Board 
and Local Workforce Investment Board for the local workforce investment 
area.


Sec.  618.640  Subsistence and transportation payments.

    (a) General. Subsistence and transportation payments must be 
provided to an adversely affected worker whose training has been 
approved under Sec.  618.610 (criteria for approval of training) to 
defray reasonable subsistence and transportation expenses while the 
worker attends a training program at a facility outside the worker's 
commuting area. The need for such subsistence and transportation 
payments must be identified in the worker's IEP as described in Sec.  
618.350 (IEPs).
    (b) Applications for subsistence and transportation payments. An 
adversely affected worker must submit an application for any 
subsistence or transportation payments in accordance with this section 
on forms furnished by the cooperating State agency. A determination on 
an application made under this section is subject to Sec.  618.825 
(determinations and notice) and Sec.  618.835 (appeals and hearings).
    (c) Subsistence payments. (1) General. Subsistence payments must be 
made for the costs of separate maintenance, which means maintaining 
another (second) residence, when the training facility is located 
outside the adversely affected worker's commuting area.
    (2) Requirements for subsistence payments. (i) An adversely 
affected worker must receive subsistence payments only for the period 
when he or she is not receiving or authorized to receive reimbursement 
or separate payments for such costs from any other source; and
    (ii) No subsistence payment may be made for any day for which such 
worker receives a daily commuting transportation allowance from TAA 
funds or from any other source or any day of unexcused absence as 
certified by the training institution.
    (3) Amount of subsistence payments. The cooperating State agency 
may pay subsistence to an adversely affected worker only for the lesser 
of:
    (i) The adversely affected worker's actual per diem expenses for 
subsistence, or
    (ii) 50 percent of the prevailing per diem allowance rate 
authorized under the Federal travel regulations (see 41 CFR parts 301 
through 304) for the training facility.
    (4) Timing of subsistence payments. The cooperating State agency 
must make subsistence payments upon an adversely affected worker's 
completion of a week of training, but may advance a subsistence payment 
for a week if it determines that such advance is necessary to enable an 
adversely affected worker to participate in training.
    (d) Transportation payments. (1) General. Travel for which a 
transportation payment must be paid includes travel:
    (i) At the beginning and end of the training program located 
outside the commuting area, where the adversely affected worker lives 
at or near the training site and will not commute daily to his or her 
permanent residence;
    (ii) In order to return to the worker's permanent residence when 
the worker fails with justifiable cause (as described in Sec.  
618.765(b)(3)(iii)) to complete a training program located outside the 
worker's commuting area; and
    (iii) When the worker travels daily beyond the commuting area, and 
receives transportation payments in lieu of subsistence. In such cases, 
the daily transportation payment must not exceed the amount otherwise 
payable as subsistence for each day of commuting.
    (2) Requirements for transportation payments. An adversely affected 
worker must receive payments for transportation expenses when commuting 
to and from the training facility outside the commuting area. 
Transportation payments will only be made when the total amount of such 
payments will not exceed the total amount of subsistence payments that 
would be made if the adversely affected worker were to maintain a 
residence within the commuting area of the training facility. 
Transportation payments are payable only for the actual days traveled. 
Transportation payments must not be paid when:
    (i) Transportation is arranged and paid for by the cooperating 
State agency for one or more workers,

[[Page 50816]]

    (ii) Such payments are being provided under any other law, or
    (iii) The adversely affected worker is authorized to be paid or 
reimbursed for such expenses from any other source.
    (3) Amount of transportation payments. Such transportation payments 
to an adversely affected worker must not exceed the lesser of:
    (i) The actual cost for travel by the least expensive means of 
public transportation reasonably available, or
    (ii) The cost per mile at the prevailing personal vehicle mileage 
rate authorized under the Federal travel regulations (see 41 CFR parts 
301 through 304). See also Travel on Government Business, Privately 
Owned Vehicle Reimbursement Rate at: http://www.gsa.gov. Cost per mile 
payments are solely for those miles beyond the commuting area as 
defined at Sec.  618.110.
    (4) Timing of transportation payments. (i) An adversely affected 
worker must receive transportation payments after completion of a week 
of training approved under Sec.  618.610 (criteria for approval of 
training). However, such payment may also be made in advance to 
facilitate the worker's attendance at the training institution.
    (ii) An adversely affected worker receiving subsistence payments 
may also receive transportation payments only:
    (A) At the beginning and end of the training program outside the 
daily commuting area, or
    (B) When the adversely affected worker fails for justifiable cause 
(as described in Sec.  618.765(b)(3)(iii)) to complete the training 
program and must return home before the end of the training program.
    (e) Adjustments to subsistence and transportation payment advances. 
The cooperating State agency must adjust subsistence and/or 
transportation payments if it advances funds and the amount of the 
advance is more or less than the amount to which the adversely affected 
worker is entitled to receive under paragraphs (c)(3) and (d)(3) of 
this section.


Sec.  618.645  Voluntary withdrawal from a training program.

    (a) The cooperating State agency must advise an adversely affected 
worker who chooses to withdraw from approved training that the worker's 
eligibility for TAA training (even though it was not completed) is 
terminated and the worker will not be able to resume the training 
program, except as provided in Sec.  618.615(a)(4) (limitations on 
approval of training) except that if a worker ceases participation in 
training for justifiable cause, as described in Sec.  
618.765(b)(3)(iii) (disqualifications), the worker may resume the 
approved training program if the program can be completed within the 
104 or 130-week period described in Sec.  618.615(a)(3)(i).
    (b) The worker's eligibility for job search and relocation 
allowances will not be affected by the decision to withdraw from 
training. To be eligible for these allowances, the worker must meet all 
eligibility requirements for these benefits as set forth in Sec.  
618.410 (job search allowances) and Sec.  618.515 (relocation 
allowances).


Sec.  618.650  State training cost caps.

    (a) A cooperating State agency may set a statewide or local area 
limit on the amount of training costs payable for training programs. If 
such limits are used, the methods used for calculating such limits must 
be documented and the limits must reasonably take into account the 
costs for training available in the local areas throughout the State. 
Factors that may be taken into account include average historical costs 
of training available from eligible training providers, costs of 
training for work force needs in high growth and high demand 
industries, and the overall labor prospects. The cooperating State 
agency must develop standards and procedures for the review and 
approval of training costs that exceed established limits, based on 
individual and exceptional circumstances.
    (b) The cooperating State agency must review any established limits 
on an annual basis to determine whether they continue to be appropriate 
and change or end such limits if warranted.
    (c) Whenever a cooperating State agency establishes, changes, or 
ceases using State-established limits on training costs payable under 
paragraph (a) of this section, the cooperating State agency must send 
written notice and full documentation supporting its action to the 
Director for review. Unless the Department notifies the cooperating 
State agency, otherwise, in writing, within 30 calendar days of receipt 
of such documentation, the cooperating State agency may establish, 
change, or end such limits.
    (d) The liable State will adhere to the agent State's training cost 
caps, if any, when approving training programs in the agent State.


Sec.  618.655  Training services and the TAA for Farmers program.

    (a)(1) An agricultural commodity producer entitled to receive a 
cash benefit under a certification under the TAA for Farmers program 
administered by the U.S. Department of Agriculture (see 7 CFR part 
1580) is entitled to training under this subpart F where the 
cooperating State agency determines that training approval criteria 2 
through 6 (Sec. Sec.  618.610(b) through (f)) are met.
    (2) With the exception of training approval criterion 1 (Sec.  
618.610(a)), all the provisions of subpart F of this Part apply to 
training for an agricultural commodity producer under paragraph (a)(1) 
of this section.
    (3)(i) An agricultural commodity producer is not entitled to 
training under subpart F of this Part where that individual obtains 
work of a substantially equal or higher skill level than his or her 
past work as an agricultural commodity producer and wages for such work 
at not less than 80 percent of the agricultural commodity producer's 
average weekly income.
    (ii) The average weekly income will be determined based upon the 
most recent tax year that has ended for the individual prior to the 
agricultural commodity producer's notice of entitlement to a cash 
benefit under the TAA for Farmers program. The average weekly income 
will be obtained by dividing by 52 the net income reported on the 
agricultural commodity producer's tax return as income from all self-
employment. In the event that the agricultural commodity producer filed 
a joint return, the average weekly income will be determined based upon 
the share of that self-employment income attributable to that 
individual.
    (b) The cooperating State agency must, upon receiving an 
application for training by an agricultural commodity producer, verify 
the individual's entitlement to a cash benefit under the TAA for 
Farmers program in accordance with procedures established by the 
Department of Labor.
    (c) An agricultural commodity producer receiving training under 
paragraph (a) of this section is entitled to subsistence and 
transportation payments in accordance with Sec.  618.640 where the 
cooperating State agency determines that the requirements of that 
section are met.
    (d) An agricultural commodity producer entitled to a cash benefit 
in multiple years for the same commodity is not entitled to a different 
training program under each certification. Only one training program is 
allowed per affected commodity, except as provided under Sec.  
618.615(a)(4) (regarding certain workers who perform service in the 
Uniformed Services) and Sec.  618.615(b) (on amending approved training 
programs).
    (e) An agricultural commodity producer establishing entitlement to 
a cash benefit in accordance with

[[Page 50817]]

paragraph (a)(2) of this section is entitled to employment services 
under subpart C of this part, but is not entitled to any other benefits 
under the TAA program, including TRA under subpart G, job search 
allowances under subpart D, relocation allowances under subpart E, or 
ATAA.

Subpart G--Trade Readjustment Allowances


Sec.  618.700  Scope.

    This subpart explains the requirements for eligibility for and the 
amounts and duration of basic TRA, additional TRA, and remedial TRA, 
all of which are income support in the form of cash payments for an 
adversely affected worker after such worker exhausts all rights to UI 
(except for additional compensation, as defined in Sec.  618.110).


Sec.  618.705  Categories of TRA.

    (a) Basic TRA. Basic TRA is payable to an adversely affected worker 
who meets the requirements of Sec.  618.715 (qualifying requirements 
for basic TRA). Basic TRA is payable for weeks of unemployment after 
the worker meets the criteria for exhaustion of UI under Sec.  
618.715(e); and, consistent with Sec.  618.720 (training requirement 
for receipt of basic, additional, and remedial TRA), for weeks of 
unemployment during which the worker either is enrolled in, is 
participating in, or has completed training (including, if necessary, 
remedial education) approved under subpart F of this part 618, or has 
received from the State agency a waiver of the training requirement 
(under Sec.  618.725).
    (b) Additional TRA. Additional TRA is payable to an adversely 
affected worker who meets the requirements of Sec.  618.750 (qualifying 
requirements for, and duration of, additional TRA). Additional TRA is 
payable only for weeks of unemployment during which the worker is 
participating in a training program, whether remedial education or 
other training, approved under subpart F of this part 618 and only 
after the worker has exhausted all rights to basic TRA.
    (c) Remedial TRA. Remedial TRA is payable to an adversely affected 
worker who meets the requirements of Sec.  618.755 (qualifying 
requirements for, and duration of, remedial TRA). Remedial TRA is 
payable only for weeks of unemployment during which the worker is 
participating in a training program, whether remedial education or 
other training, approved under subpart F of this part 618. Remedial TRA 
is payable only after the worker has exhausted all rights to basic and 
additional TRA.
    (d) Nonduplication of TRA. An adversely affected worker may receive 
only one form of TRA (basic, additional, or remedial) for a given week 
of unemployment.


Sec.  618.710  Applications for TRA and payment.

    (a) When a worker may apply for TRA. A worker may apply to the 
cooperating State agency for TRA if the worker is covered under either 
a certification or, if before a certification is issued, a pending 
petition for certification.
    (b) Determinations on TRA applications that are filed before 
certification issued. The cooperating State agency must make those 
determinations necessary to establish or protect an individual's 
potential entitlement to TRA and, if necessary, to protect the worker's 
eligibility for the HCTC. These determinations may include 
determinations on enrollment in training and determinations on waivers. 
If a determination is made before a certification is issued, the 
cooperating State agency must advise the worker that eligibility for 
the benefits that are the subject of the determination is contingent on 
the issuance of a certification.
    (c) Timing of TRA application after certification issued. For TRA 
applications filed after a certification covering a worker is issued, 
an initial application for TRA, as well as applications for TRA for 
weeks of unemployment beginning before the initial application for TRA 
is filed, may be filed within a reasonable period of time after 
publication of the determination certifying a group of workers as 
eligible to apply for TAA or TAA and ATAA . However, an application for 
TRA for a week of unemployment beginning after the initial application 
is filed must be filed within the time limit applicable to claims for 
regular compensation under the applicable State law. For purposes of 
this paragraph (c), a reasonable period of time means such period of 
time as the adversely affected worker had good cause for not filing 
earlier, which may include, but need not be limited to, such worker's 
lack of knowledge of the certification or misinformation supplied such 
worker by the cooperating State agency.
    (d) Applicable procedures. Applications must be filed in accordance 
with this subpart G and on forms furnished to workers by the 
cooperating State agency. The procedures for reporting and filing 
applications for TRA must be consistent with this part 618 and with the 
Secretary's ``Standard for Claim Filing, Claimant Reporting, Job 
Finding and Employment Services,'' Employment Security Manual, Part V, 
sections 5000 et seq. (Appendix A of Part 617 of this chapter).
    (e) Treatment of Determinations. Determinations on TRA applications 
are determinations to which Sec. Sec.  618.625 (determinations and 
notice), 618.830 (liable and agent State responsibilities), and 618.835 
(appeals and hearings) of subpart H apply. Copies of such applications 
for TRA and all determinations by the cooperating State agency on such 
applications, must be included in the adversely affected worker's case 
record.
    (f) Payment of TRA. (1) A cooperating State agency must not make 
any payment of TRA (or other TAA) until a certification is issued and 
the cooperating State agency determines that the worker is covered 
thereunder; and
    (2) The first week any adversely affected worker may be entitled to 
a payment of TRA is the first week beginning more than 60 days after 
the date of the filing of the petition that resulted in the 
certification under which the adversely affected worker is covered.


Sec.  618.715  Qualifying requirements for basic TRA.

    To qualify for basic TRA for a week of unemployment, an individual 
must meet each of the requirements in paragraphs (a) through (h) of 
this section:
    (a) Certification. The individual must be an adversely affected 
worker covered under a certification;
    (b) Separation. The adversely affected worker's first qualifying 
separation (as defined in Sec.  618.110) must occur on or after the 
impact date of the certification and before the expiration of the two 
year period beginning on the date of such certification, or, if 
earlier, before the termination date, if any, of such certification;
    (c) Wages and employment. The adversely affected worker must meet 
the following wage and other requirements:
    (1) In the 52-week period (i.e., 52 consecutive calendar weeks) 
ending with the week of the adversely affected worker's first 
qualifying separation (as defined in Sec.  618.110), or any subsequent 
qualifying separation (as defined in Sec.  618.110) under the same 
certification, the worker must have had at least 26 weeks of employment 
at wages of $30 or more a week in adversely affected employment with a 
single firm or,

[[Page 50818]]

where there is more than one subdivision, the appropriate subdivision 
of that firm. Evidence that the worker meets this requirement must be 
obtained as provided in Sec.  618.730 (maximum amount of basic TRA). 
Employment and wages covered under more than one certification may not 
be combined to qualify for TRA.
    (2) The following categories of weeks also must be treated as weeks 
of employment at wages of $30 or more, regardless of whether the 
adversely affected worker actually receives any wages during such 
weeks, for purposes of this paragraph (c):
    (i) All weeks, up to a maximum of 7 weeks, during which the 
adversely affected worker is on employer-authorized leave for vacation, 
sickness, injury, maternity, or inactive duty or active duty military 
service for training.
    (ii) All weeks, up to a maximum of 7 weeks, during which the 
adversely affected worker had adversely affected employment interrupted 
to serve as a full-time representative of a labor organization in such 
firm or subdivision.
    (iii) All weeks, up to a maximum of 26 weeks, during which the 
adversely affected worker has a disability compensable under a workers' 
compensation law or plan of a State or the United States.
    (iv) All weeks, up to a maximum of 26 weeks, during which the 
adversely affected worker is on call-up for the purpose of active duty, 
if such active duty is ``Federal service'' as defined in Sec.  614.2(g) 
of this chapter, in a reserve status in the Armed Forces of the United 
States.
    (3) Wages and employment creditable under this paragraph (c) must 
not include employment, or wages earned or paid for employment, which 
is contrary to or prohibited by any Federal law.
    (d) Entitlement to UI. The adversely affected worker must have been 
entitled to (or would have been entitled to if the worker had applied 
therefor) UI for a week within the first benefit period as defined in 
Sec.  618.110;
    (e) Exhaustion of UI. The adversely affected worker must meet the 
following two requirements:
    (1) The adversely affected worker must have exhausted all rights to 
any UI, except additional compensation that is funded by a State and 
not reimbursed from any Federal funds (see Sec.  618.110), to which 
such worker was entitled (or would have been entitled had such worker 
applied therefor). Thus, whenever an adversely affected worker becomes 
entitled (or would become entitled if the worker applied therefor) to 
any type of UI (as defined in Sec.  618.110), except additional 
compensation funded by a State and not reimbursed from any Federal 
funds, after the start of the adversely affected worker's receipt of 
TRA, then payment of TRA must be suspended until such worker exhausts 
entitlement to such UI. After the adversely affected worker exhausts 
that entitlement, as set forth in Sec.  618.240(a), payments of TRA to 
which the worker is still entitled may resume.
    (2) The adversely affected worker must have no unexpired waiting 
period applicable to such worker for any UI, except additional 
compensation (as defined in Sec.  618.110) that is funded by a State 
and is not reimbursed from any Federal funds.
    (f) Extended Benefit work test. The adversely affected worker must 
be able and available for work, as defined in the applicable State law 
for UI claimants, and must meet the Extended Benefit (EB) work test 
requirements by the means described in this paragraph (f), unless any 
exception described in paragraph (f)(2) of this section applies:
    (1) The EB work test requirement must be met by:
    (i) Registering for work with the State, in accordance with those 
provisions of the applicable State law which apply to EB claimants and 
which are consistent with part 615 of this chapter,
    (ii) Applying for any suitable work, as defined in Sec.  618.110, 
to which the adversely affected worker is referred by the State,
    (iii) Actively engaging in seeking work,
    (iv) Furnishing the State with tangible evidence of work search 
efforts each week, and
    (v) Accepting any offer of suitable work.
    (2) The able and available requirement and the EB work test 
requirement do not apply for purposes of TRA eligibility--
    (i) When the adversely affected worker is enrolled or participating 
in a training program approved under Subpart F of this Part 618, or,
    (ii) During a break in training that does not exceed 30 days as 
counted in accordance with Sec.  618.760(b), or,
    (iii) With respect to claims for TRA for those weeks of 
unemployment beginning before the filing of an initial claim for TRA, 
or for any week which begins before the adversely affected worker is 
notified that such worker is covered by a certification issued under 
the Act and is fully informed of the EB work test requirements. Before 
such notification and advice, the worker must not be subject to the EB 
work test requirements for TRA eligibility purposes, nor to any State 
timely filing requirement, but must be required to be unemployed and 
able to work and available for work with respect to any such week 
except as provided in paragraphs (f)(2)(i) and (f)(2)(ii) of this 
section for adversely affected workers enrolled in, or participating 
in, a training program approved under subpart F.
    (g) Unemployed. The adversely affected worker must be unemployed, 
as defined in the applicable State law for UI claimants.
    (h) Participation in approved training. The adversely affected 
worker must be enrolled in, participating in, or have completed, 
training under the requirements of Sec.  618.720 (training requirement 
for receipt of basic, additional, and remedial TRA), unless, with 
respect to basic TRA, these requirements are waived under Sec.  
618.725. This participation in approved training requirement does not 
apply as a condition for receiving basic TRA before the applicable 
deadline under Sec.  618.720(c).


Sec.  618.720  Training requirement for receipt of basic, additional, 
and remedial TRA.

    (a) Basic TRA. As a condition for receiving basic TRA, except 
before the applicable deadline under paragraph (c) of this section, the 
adversely affected worker, after a total or partial separation from 
adversely affected employment within the certification period of a 
certification issued under this part 618, must--
    (1) Be enrolled in (as explained in paragraph (e)(1) of this 
section) a training program approved under subpart F of this part 618; 
or
    (2) Be participating in (as explained in paragraph (e)(2) of this 
section) a training program approved under subpart F of this part 618; 
or
    (3) Have completed (as explained in paragraph (e)(3) of this 
section) a training program approved under subpart F of this part 618; 
or
    (4) Have a waiver granted under Sec.  618.725 in effect.
    (b) Additional and remedial TRA. As a condition for receiving 
additional or remedial TRA, the adversely affected worker must be 
participating in a training program approved under subpart F of this 
part 618, as explained in paragraph (e)(2) of this section.
    (c) Enrollment in training deadlines. As a condition for receiving 
basic, additional, or remedial TRA, the adversely affected worker must 
be enrolled in a training program approved under subpart F of this part 
618 (unless, in the case of basic TRA, a waiver

[[Page 50819]]

granted under Sec.  618.725 is in effect) no later than the latest of:
    (1) The last day of the 16th week after the adversely affected 
worker's most recent qualifying separation as defined in Sec.  618.110; 
or
    (2) The last day of the 8th week after the week in which the 
certification was issued; or
    (3) The last day of the 30-consecutive calendar day period 
following the termination or revocation of a waiver under Sec.  
618.725; or
    (4) 45 days after the later of the dates specified in paragraphs 
(c)(1) or (c)(2) of this section, if there are extenuating 
circumstances that justify an extension of the enrollment period. 
Extenuating circumstances that justify the 45-day extension are unusual 
situations that are beyond the direct control of the adversely affected 
worker, and that make enrollment within the otherwise applicable 
deadline impossible or impractical. They include, but are not limited 
to, the following:
    (i) Abrupt cancellation of the training program by the training 
provider;
    (ii) The first available enrollment date is after the deadline 
specified in paragraphs (c)(1) or (c)(2) of this section;
    (iii) The adversely affected worker suffers injury or illness that 
prevents his or her ability to enroll; or
    (iv) Failure of the cooperating State agency to notify the 
adversely affected worker of the petition certification and/or training 
enrollment deadlines.
    (5) An adversely affected worker who is not enrolled in training 
may receive basic TRA before the expiration of the applicable deadline 
under this paragraph (c).
    (d) Exceptions. (1) The requirement of paragraph (a) of this 
section that a worker be enrolled in, or participating in, training 
does not apply to an adversely affected worker with respect to claims 
for basic TRA for weeks of unemployment beginning before the filing of 
an initial claim for TRA within a reasonable period of time as provided 
in Sec.  618.710(c), nor for any week which begins before the worker is 
notified that the individual is covered by a certification issued under 
the Act and is fully informed of the requirements of this section.
    (2)(i) The enrollment in training deadlines of paragraph (c) of 
this section do not apply where a cooperating State agency's negative 
determination on an initial application for TRA under subpart G of this 
part 618 has been reversed through redetermination or appeal; the delay 
in obtaining the reversal is not attributable to the adversely affected 
worker; and the adversely affected worker is unable to meet the 
enrollment in training deadlines because of the delay in obtaining the 
reversal of the negative determination.
    (ii) Where the conditions of paragraph (d)(2)(i) of this section 
are met, the worker will have until the last day of the 8th week after 
the week in which the negative determination was reversed in which to 
enroll in training.
    (e) For purposes of the training requirement in paragraphs (a) and 
(b) of this section, the following provisions apply:
    (1) A worker is ``enrolled in training'' if the cooperating State 
agency has approved an application for training and the training 
institution has furnished written notice that the worker has been 
accepted into the approved program, which is scheduled to begin within 
30 calendar days of the approval of the training application.
    (2) An adversely affected worker is ``participating in training'' 
if--
    (i) The worker is either attending and participating in all 
scheduled classes, required activities, and required events, or the 
training institution has excused the worker's absence or failure to 
participate in accordance with its written policies. After the close of 
each month during which the training program is in session, the 
training institution must certify in writing to the cooperating State 
agency whether, for each week ending during the prior month, the worker 
has attended and participated in all scheduled classes, required 
activities, and required events or whether it has excused the worker's 
absence in accordance with it written policies; or
    (ii) In the case of distance learning, the worker is either meeting 
all the requirements of the training institution in accordance with its 
rules, regulations, and standards, or the training institution has 
excused the worker's failure to meet those requirements in accordance 
with its written policies. After the close of each month during which 
the training program is in session, the training institution must 
certify in writing to the cooperating State agency whether, for each 
week ending during the prior month, the worker has met all the 
requirements of the training institution, or whether it has excused the 
worker from those requirements in accordance with its written policies; 
or
    (iii) For any week during a break in training, if all of the 
requirements of Sec.  618.760 (concerning payment of TRA during breaks 
in training) are met.
    (3) An adversely affected worker has ``completed training'' if--
    (i) The training program was approved under subpart F of this part 
618; and
    (ii) The training program was completed after the worker's total or 
partial separation from adversely affected employment within the 
certification period of a TAA certification; and
    (iii) The training provider has certified that all the conditions 
for completion of the training program have been satisfied.


Sec.  618.725  Waiver of training requirement for basic TRA.

    (a) Waiver for basic TRA. A cooperating State agency may issue a 
written waiver of the requirement in Sec.  618.720 that an adversely 
affected worker be enrolled or participating in training as a condition 
of basic TRA eligibility upon a finding that training for such worker 
is not feasible or appropriate, for one or more reasons identified in 
paragraph (b) of this section. The waiver must contain the information 
required in paragraph (c) of this section. No waiver of the training 
requirement is permitted for additional TRA or remedial TRA 
eligibility. Waivers must be issued no later than the latest of the 
applicable deadlines described in Sec.  618.720(c).
    (b) Bases for a waiver. The cooperating State agency, in order to 
issue a written waiver to an adversely affected worker, must conclude, 
after conducting an assessment of such worker, that training is not 
feasible or appropriate for one or more of the following reasons, which 
must be cited in the written waiver:
    (1) The adversely affected worker has been notified that he or she 
will be recalled to the same or substantially the same position by the 
firm from which the separation occurred, and the recall is expected to 
be permanent. A recall for purposes of this paragraph (b)(1) means that 
the employer who separated the worker from adversely affected 
employment has issued a specific recall whereby the employer notified 
the adversely affected worker, or a group of workers including such 
worker, to return to work on a certain date or within a specified time 
period.
    (2) The adversely affected worker has marketable skills and there 
is a reasonable expectation of suitable employment (as defined in Sec.  
618.110) within the foreseeable future.
    (3) The adversely affected worker is within 2 years of meeting all 
requirements for entitlement to either:
    (i) Full or partial retirement old-age insurance under title II of 
the Social Security Act (42 U.S.C. 401 et seq.)

[[Page 50820]]

(except for the requirement of application therefor); or
    (ii) A private pension sponsored by an employer or labor 
organization.
    (4) The adversely affected worker is unable to participate in a 
training program for health reasons. A waiver granted for this reason 
does not exempt the worker from requirements relating to the 
availability for work, active search for work, or refusal to accept 
work under Federal or State UI laws.
    (5) The first available enrollment date for training is within 60 
days after the date on which a waiver determination is made, or, if 
later, there are extenuating circumstances, as determined under the 
criteria in Sec.  618.720(b)(4) (training requirement for basic TRA), 
that apply to the delay in enrollment in training.
    (6) Training is not reasonably available from governmental or 
private sources (which may include area vocational education schools, 
as defined in Sec.  3 of the Carl D. Perkins Vocational and Technical 
Education Act of 1998 (20 U.S.C. 2302), and employers), or suitable 
training is not available at a reasonable cost, or training funds are 
unavailable.
    (c) Contents of a waiver. A waiver issued under this section may 
not take effect unless it contains, at a minimum, the following 
information:
    (1) The adversely affected worker's name and the worker's social 
security number or another identifying designation used by the State;
    (2) The name and location of the worker group and the petition 
number under which the adversely affected worker's group was certified;
    (3) A statement of the reasons why training is not feasible or 
appropriate for the adversely affected worker, citing to one or more 
reasons identified in paragraph (b) of this section;
    (4) The effective date and expiration date of the waiver;
    (5) A statement that the waiver must be revoked immediately upon a 
determination that the basis or bases for the waiver no longer apply; 
and
    (6) The signature of an official of the cooperating State agency 
authorized to grant the waiver, and the signature of the adversely 
affected worker or other evidence of the worker's receipt of the waiver 
to acknowledge such worker's receipt of the waiver.
    (d) Denial of a waiver. In any case where the cooperating State 
agency denies a request (whether or not made by the adversely affected 
worker to whom the request pertains) that a waiver under this section 
be issued, the adversely affected worker to whom the denial pertains 
must be furnished with a written notice of the denial of waiver. The 
cooperating State agency must afford such worker the right to appeal 
the denial of a waiver. The written notice of denial of waiver must 
contain, at minimum, the information in paragraphs (c)(1), (c)(2) and 
(c)(6) of this section; the specific reason(s) for the denial; the date 
of the denial; and notice of the adversely affected worker's appeal 
rights.
    (e) Duration of a waiver issued under this section. (1) A waiver 
issued under this section may be for a period not to exceed 6 months, 
or the worker's period of basic TRA entitlement, whichever comes first, 
and must be reviewed every 30 days to determine if one or more of the 
bases in paragraph (b) of this section continue to apply.
    (2) Notwithstanding the 6-month limitation in paragraph (e)(1) of 
this section, a cooperating State agency may extend an adversely 
affected worker's waiver beyond 6 months, only if:
    (i) Training continues not to be feasible or appropriate for such 
worker for one or more of the reasons described in paragraph (b) of 
this section; and
    (ii) Such worker has not yet exhausted his or her basic TRA 
entitlement.
    (f) Revocation of a waiver. The cooperating State agency must 
revoke a waiver issued under this section if the waiver criteria are no 
longer met. The cooperating State agency must notify the adversely 
affected worker in writing of any such revocation. The notice of 
revocation must be appealable and must contain the same information as 
a denial of waiver issued under paragraph (d) of this section as 
appropriate.
    (g) Submission of waivers and notices. The cooperating State agency 
must submit to the appropriate Regional Administrator, upon request, a 
copy of any or all waivers issued under this section together with a 
statement of reasons for each such waiver, and a copy of any or all 
notices of revocation of waiver issued under this section together with 
a statement of reasons for each such revocation.


Sec.  618.730  Evidence of qualification for basic, additional, and 
remedial TRA.

    (a) Cooperating State agency action. When a worker applies for 
basic, additional, or remedial TRA, the cooperating State agency having 
jurisdiction under Sec.  618.825 (determinations of eligibility) must 
obtain information necessary to establish:
    (1) Whether the worker meets the qualifying requirements in Sec.  
618.715 for basic TRA, in Sec.  618.750 for additional TRA, or in Sec.  
618.755 for remedial TRA;
    (2) For a worker claiming to be partially separated, the average 
weekly hours (as defined in Sec.  618.110) and average weekly wage (as 
defined in Sec.  618.110) in adversely affected employment.
    (b) Insufficient data. If information specified in paragraph (a) of 
this section is not available from cooperating State agency records or 
from any employer, the cooperating State agency must require the worker 
to submit a signed statement setting forth such information as may be 
required for the cooperating State agency to make the determinations 
required by paragraph (a) of this section.
    (c) Verification. A statement made under paragraph (b) of this 
section must be certified by the worker to be true to the best of the 
worker's knowledge and belief and must be supported by evidence such as 
W-2 Forms, paycheck stubs, union records, income tax returns, or 
statements of fellow workers, and must, if possible, be verified by the 
employer.
    (d) Determinations. The cooperating State agency must make the 
necessary determinations on the basis of information obtained under 
this section, except that if, after reviewing information obtained 
under paragraph (b) and (c) of this section against other available 
data, including agency records, it concludes that such information is 
not reasonably accurate, it must make the determination on basis of the 
best available information.


Sec.  618.735  Weekly amounts of basic, additional, and remedial TRA.

    (a) Regular allowance. The amount of basic, additional, or remedial 
TRA payable for a week of total unemployment (including a week of 
training approved under subpart F of this part 618) is an amount equal 
to the most recent weekly benefit amount of UI (including dependents' 
allowances) payable to the individual for a week of total unemployment 
preceding the individual's exhaustion of UI following the individual's 
first qualifying separation (as defined in Sec.  618.110); except 
that--
    (1) In a State in which weeks of UI are paid in varying amounts 
related to wages with separate employers, the weekly amount of TRA must 
be calculated as it would be to pay extended compensation; and
    (2) Where a State calculates a base amount of UI and calculates 
dependents' allowances on a weekly supplemental basis, TRA weekly 
benefit amounts must be calculated in the same manner and under the 
same terms and conditions as apply to claimants for UI, except that the 
base amount must not change.

[[Page 50821]]

    (b) Increased allowance. An adversely affected worker in training 
approved under subpart F of this part 618 who is thereby entitled for 
any week to TRA and a training allowance under any other Federal law 
for the training of workers will be paid in the amount computed under 
paragraph (a) of this section or, if greater, the amount to which the 
adversely affected worker would be entitled under such other Federal 
law if such worker applied for such allowance. A payment under this 
paragraph (b) is in lieu of any training allowance to which the 
adversely affected worker is entitled under such other Federal law.
    (c) Reductions to the TRA weekly amount.The weekly amount of TRA 
payable under this section will be reduced (but not below zero) by--
    (1) Income that is deductible from UI under the disqualifying 
income provisions of the applicable State law or Federal UI law;
    (2) The amount of a training allowance (other than a training 
allowance referred to in paragraph (b) of this section) under any 
Federal law that the adversely affected worker receives for such week, 
except that no reduction of the TRA weekly amount will be made for the 
receipt of Federal student financial assistance (as defined in Sec.  
618.110), and that in the case of an adversely affected worker to whom 
such Federal student financial assistance is available, the State will 
rely on prearrangements for the sharing of costs under Sec.  
618.625(c)(2) (payment restrictions for training programs) in order to 
harmonize the provision of such Federal student financial assistance 
with the worker's TRA entitlement; and
    (3) Any amount that would be deductible from UI for days of absence 
from training under the provisions of the applicable State law that 
applies to workers in approved training.


Sec.  618.740  Maximum amount of basic TRA.

    (a) General rule. Except as provided in paragraph (b) of this 
section, the maximum amount of basic TRA payable to an adversely 
affected worker is the product of 52 multiplied by the TRA weekly 
amount for a week of total unemployment, calculated under Sec.  
618.735(a) (weekly amounts of TRA), reduced by the total sum of UI 
(except additional compensation (defined at Sec.  618.110)) that such 
worker received, or would have received had such worker either applied 
therefor or not been subject to a disqualification under the applicable 
State law, in such worker's first benefit period as defined in Sec.  
618.110.
    (b) Exceptions. The maximum amount of TRA determined under 
paragraph (a) of this section does not include:
    (1) The amount of dependents' allowances paid as a supplement to 
the base weekly amount determined under Sec.  618.735(a); and
    (2) The amount of the difference between the adversely affected 
worker's weekly increased allowances determined under Sec.  618.735(b) 
and such worker's weekly amount determined under Sec.  618.735(a).
    (c) Reduction for Federal training allowance. (1) If a training 
allowance referred to in Sec.  618.735(c)(2) is greater than the amount 
of TRA otherwise payable to an adversely affected worker for any week 
of unemployment with respect to which the worker would be entitled to 
TRA (determined without regard to any disqualification under Sec.  
618.765(b)(2)), if the worker had applied for TRA for such week, then 
each week must be deducted from the total number of weeks of TRA 
otherwise payable to such worker, except that no such deduction will be 
made for the receipt of Federal student financial assistance as defined 
in Sec.  618.110. In the case of an adversely affected worker to whom 
such Federal student financial assistance is available, the State will 
rely on prearrangements for the sharing of training costs under Sec.  
618.625(c)(2) in order to harmonize the provision of such Federal 
student financial assistance with the worker's TRA entitlement.
    (2) If the training allowance referred to in paragraph (c)(1) of 
this section is less than the amount of TRA otherwise payable to the 
adversely affected worker for such week, such worker must, when 
applying for TRA for such week, be paid TRA in an amount not to exceed 
the difference between such worker's regular weekly TRA amount, as 
determined under Sec.  618.735(a), and the amount of the training 
allowance paid to such worker for such week. However, if the training 
allowance referred to in paragraph (c)(1) is Federal student financial 
assistance as defined in Sec.  618.110, then the amount of TRA will not 
be reduced. In the case of an adversely affected worker to whom such 
Federal student financial assistance is available, the State will rely 
on prearrangements for the sharing of training costs under Sec.  
618.625(c)(2) (payment restrictions for training programs) in order to 
harmonize the provision of such Federal student financial assistance 
with the worker's TRA entitlement.


Sec.  618.745  Eligibility period for basic TRA.

    (a) Except as provided in paragraph (b) of this section, an 
adversely affected worker is ineligible to receive basic TRA for any 
week of unemployment beginning after the close of the 104-week period 
beginning with the first week following the week in which the adversely 
affected worker's most recent qualifying separation (defined in Sec.  
618.110) occurred. If necessary to permit an adversely affected worker 
to complete training, approved under subpart F of this part 618, that 
includes remedial education, that 104-week period will be extended to 
130 weeks.
    (b) The limitation in paragraph (a) of this section does not apply 
where a negative determination on a petition filed under subpart B of 
this part 618 has been appealed to the United States Court of 
International Trade; and the certification is later granted; and the 
delay in the certification is not attributable to the petitioner or the 
adversely affected worker; and the adversely affected worker does not 
have enough weeks remaining in the eligibility period established under 
paragraph (a) of this section, together with weeks of entitlement to 
additional TRA, to extend the duration of the period of TRA eligibility 
(basic, additional, and remedial) through the completion of training 
approved under subpart F of this part 618. In that event, the 
eligibility period for basic TRA will be extended, on a case-by-case 
basis, as necessary to provide an eligibility period for basic and 
additional TRA (and remedial TRA, if applicable) through the completion 
of that training. In no event may the basic TRA eligibility period 
extend beyond the close of the 104-week period (or, in cases where the 
worker takes remedial education courses, the 130-week period) beginning 
with the first week following the week of the certification. Nothing in 
this paragraph (b) modifies the limitation on the maximum amount of 
basic, additional, or remedial TRA.
    (c) The limitation in paragraph (a) of this section does not apply 
where a cooperating State agency's negative determination on an 
application for TRA filed under subpart G of this part 618 has been 
reversed on redetermination or appeal; the delay in obtaining the 
reversal is not attributable to the adversely affected worker; and the 
adversely affected worker does not have enough weeks remaining in the 
eligibility period established under paragraph (a) of this section, 
together with weeks of entitlement to additional TRA, to extend the 
duration of the period of TRA eligibility (basic,

[[Page 50822]]

additional, and remedial) through the completion of training approved 
under subpart F of this part 618. In that event, the eligibility period 
for basic TRA will be extended, on a case-by-case basis, as necessary 
to provide an eligibility period for basic and additional TRA (and 
remedial TRA, if applicable) through the completion of that training. 
In no event may the basic TRA eligibility period extend beyond the 
close of the 104-week period (or, in cases where the worker takes 
remedial education courses, the 130-week period) beginning with the 
first week following the week of the reversal. Nothing in this 
paragraph (c) modifies the limitation on the maximum amount of basic, 
additional, or remedial TRA.


Sec.  618.750  Qualifying requirements for, and duration of, additional 
TRA.

    (a) Qualifying requirements for additional TRA. An adversely 
affected worker is eligible to receive additional TRA for any week only 
if:
    (1) The worker meets all qualifying requirements for receipt of 
basic TRA in Sec.  618.715; and
    (2) Except as provided in Sec.  618.760 for a break in training, 
the adversely affected worker actually participated in training, 
approved under subpart F of this part 618, during that week; and
    (3) The adversely affected worker filed a bona fide application for 
training (as defined in Sec.  618.110) within the later of 210 days 
after the certification date or 210 days after such worker's most 
recent total or partial separation (as defined, respectively, in Sec.  
618.110 and Sec.  618.110); provided, that if the adversely affected 
worker is unable to meet this deadline for the same reasons as in Sec.  
618.720(d)(2)(i), the worker will have 210 days from the date of the 
reversal of a denial of an initial application for TRA in which to file 
a bona fide application.
    (b) Duration of additional TRA. Additional TRA is payable for up to 
52 weeks during the 52 consecutive-calendar week period that--
    (1) Immediately follows the last week of entitlement to basic TRA 
otherwise payable to the individual; or
    (2) Begins with the first week of training approved under subpart F 
of this part 618, if such training begins after the last week described 
in paragraph (b)(1) of this section; or
    (3) Begins with the first week in which such training is approved 
under subpart F of this part 618, if such training is approved after 
the training has commenced; but approval of training under subpart F of 
this part 618 after the training has commenced does not imply or 
justify approval of a payment of basic or additional TRA with respect 
to any week which ended before the week in which such training was 
approved, nor approval of payment of any costs of training or any costs 
or expenses associated with such training (such as travel or 
subsistence) which were incurred before the date of the approval of 
such training under subpart F of this part 618.


Sec.  618.755  Qualifying requirements for, and duration of, remedial 
TRA.

    (a) Qualifying requirements for remedial TRA. An adversely affected 
worker is eligible to receive remedial TRA for any week only if--
    (1) Such worker meets all qualifying requirements for receipt of 
basic TRA in Sec.  618.715 (qualifying requirements for basic TRA); and
    (2) The adversely affected worker actually participated in a 
program of remedial education, approved under subpart F of this part 
618, during or before that week; and
    (3) Participation in the program of remedial education caused the 
worker's training program to extend for a period longer than the 
periods during which basic and additional TRA are payable under, 
respectively, Sec. Sec.  618.715 (qualifying requirements for basic 
TRA) and 618.750 (qualifying requirements for, and duration of, 
additional TRA).
    (b) Duration of remedial TRA. Remedial TRA is payable only for up 
to 26 consecutive calendar weeks as necessary for an adversely affected 
worker to complete a training program that is approved under subpart F 
of this part 618 and which includes remedial education, and is payable 
only during the 26-consecutive calendar week period that begins with 
the first week following the week in which the adversely affected 
worker exhausted all rights to additional TRA under Sec.  618.750 
(qualifying requirements for, and duration of, additional TRA). No 
adversely affected worker may receive remedial TRA for a greater number 
of weeks than the number of weeks during which such worker participated 
in a program of remedial education approved under subpart F of this 
part 618. Remedial TRA may be paid only for the number of weeks that 
the program of remedial education caused the training program to extend 
training and the period in which additional TRA is payable under Sec.  
618.750.
    (c) Other forms of TRA payable for remedial education. Where a 
program of remedial education approved under subpart F of this part 618 
exceeds 26 weeks, or falls outside the 26-consecutive calendar week 
period established under paragraph (b) of this section, an adversely 
affected worker may, if otherwise eligible, receive basic or additional 
TRA for those weeks of remedial education exceeding 26 or falling 
outside the 26-consecutive calendar week period.


Sec.  618.760  Payment of basic, additional, or remedial TRA during 
breaks in training.

    (a) TRA (basic, additional, or remedial) is payable to an otherwise 
eligible adversely affected worker during breaks in training (periods 
within or between courses, terms (quarters or semesters), and academic 
years) that do not exceed 30 days (counted in accordance with paragraph 
(b) of this section), only if--
    (1) The adversely affected worker participated in training approved 
under subpart F of this part 618 immediately before the beginning of 
the break in training; and
    (2) The break in training was provided in the established schedule 
of the training provider; and
    (3) The adversely affected worker resumes participation in the 
training immediately after the break ends.
    (b) Counting of days for breaks in training. For the purpose of 
determining whether a break in training is within the 30-day maximum 
allowed under this section, all calendar days beginning with the first 
day of the training break and ending with the last day of the break, as 
provided in the published schedule of the training provider, must be 
counted. However, any Saturday, Sunday, or official State or National 
Holiday occurring during the scheduled break in training is excluded 
from the 30-day count if training normally would not be scheduled in 
the training program during those days if there was no break.


Sec.  618.765  Disqualifications.

    (a) General rule. Except as stated in paragraph (b)(1) of this 
section and in Sec.  618.840(f) (concerning disqualification due to 
fraud), an adversely affected worker may not be paid TRA for any week 
of unemployment such worker is or would be disqualified from receiving 
UI under the disqualification provisions of the applicable State law, 
including the provisions of the applicable State law which apply to EB 
claimants and are consistent with the Federal-State Extended 
Unemployment Compensation Act of 1970.
    (b) Disqualification of trainees. (1) State law inapplicable. A 
State law may not be applied to disqualify an adversely affected worker 
from receiving UI or TRA because:
    (i) Such worker is enrolled in or participating in a training 
program

[[Page 50823]]

approved under subpart F of this part 618; or
    (ii) Such worker refuses work to which the State agency referred 
such worker because such work either would require discontinuation of 
approved training or when added to the number of hours of approved 
training would occupy such worker more than 8 hours a day or 40 hours a 
week, except that this paragraph (b)(1)(ii) does not apply to an 
adversely affected worker who is ineligible under paragraph (b)(2) of 
this section; or
    (iii) Such worker quits work that was not suitable employment (as 
defined in Sec.  618.110) and it was reasonable and necessary to quit 
in order to begin or continue training approved under subpart F of this 
part 618.
    (2) Disqualifications. (i) An adversely affected worker who, 
without justifiable cause (as described in paragraph (b)(3)(iii) of 
this section), fails to begin participation (as described in paragraph 
(b)(3)(i) of this section) in training approved under subpart F of this 
part 618, or ceases participation (as described in paragraph (b)(3)(ii) 
of this section) in such training, or for whom a waiver is revoked 
under Sec.  618.725(f) (waiver of training requirement for basic TRA), 
may not receive basic TRA for any week in which such failure, 
cessation, or revocation occurred. The disqualification will continue 
for any succeeding week thereafter until the week in which such worker 
begins or resumes participation in a training program approved under 
subpart F of this part 618. A worker who has justifiable cause (as 
described in paragraph (b)(3)(iii) of this section) for such failure to 
begin, or ceasing, participation in training may receive basic TRA for 
any week in which such failure or cessation occurred if the worker 
otherwise meets the requirements of this subpart G. Such failure, 
cessation, or revocation does not change the eligibility periods 
defined in Sec. Sec.  618.745, 618.750(b), and 618.755(b), regardless 
of whether such worker had justifiable cause.
    (ii) No adversely affected worker may receive additional or 
remedial TRA for any week in which such worker failed to participate in 
training, regardless of whether such worker had justifiable cause.
    (iii) The disqualification in paragraph (b)(2)(i) of this section 
will not apply to an individual with respect to claims for TRA for 
weeks of unemployment beginning before the filing of an initial claim 
for TRA, nor for any week which begins before the individual is 
notified that the individual is covered by a certification issued under 
the Act and is fully informed of the requirements of this section.
    (3) For determining the disqualification of trainees, the following 
provisions apply:
    (i) Failed to begin participation. A worker will be determined to 
have failed to begin participation in a training program when the 
worker fails to attend one or more scheduled training classes and other 
training activities in the first week of the training program, without 
justifiable cause.
    (ii) Ceased participation. A worker will be determined to have 
ceased participation in a training program when the worker fails to 
attend all scheduled training classes and other training activities 
scheduled by the training institution in any week of the training 
program, without justifiable cause.
    (iii) Justifiable cause means, for purposes of this section, the 
reason(s) that justify the adversely affected worker's conduct when 
measured by conduct expected of a reasonable worker in the same or 
similar circumstances. For example, an excused absence under a training 
institution's written policy may be considered ``justifiable cause.'' 
The cooperating State agency must determine all cases of failure to 
enroll or begin or continue participation in training on a case-by-case 
basis.
    (c) Disqualification while in on-the-job training. An adversely 
affected worker may not be paid any TRA for any week during which such 
worker is receiving on-the-job training.


Sec.  618.770  Health Coverage Tax Credit.

    (a) An eligible TAA recipient, as defined in Sec.  618.110, an 
eligible ATAA recipient, as defined in Sec.  618.110, and an eligible 
PBGC recipient, as defined in Sec.  618.110, may be eligible for the 
Health Coverage Tax Credit subject to a determination by the Internal 
Revenue Service.
    (b) The cooperating State agency is responsible for: (1) 
Transmitting a list of eligible TAA recipients and eligible ATAA 
recipients to the Internal Revenue Service;
    (2) Providing information and assistance to workers under Sec.  
618.820(f)(4) (TAA program and benefit information to workers); and
    (3) Assisting in other activities and functions required by the 
State's Agreement with the Secretary under Sec.  618.805 (agreements 
with the Secretary of Labor).

Subpart H--Administration By Applicable State Agencies


Sec.  618.800  Scope.

    This subpart covers the administrative procedures a cooperating 
State agency must follow in delivering TAA program benefits and 
services to adversely affected workers.


Sec.  618.805  Agreements with the Secretary of Labor.

    (a) Authority. A State or cooperating State agency must, before 
performing any function or exercising any jurisdiction under the Act 
and this part 618, execute an Agreement with the Secretary meeting the 
requirements of the Act.
    (b) Execution. An Agreement under paragraph (a) of this section 
must be signed and dated on behalf of the State or the cooperating 
State agency by an authorized official whose authority is certified by 
the State Attorney General or counsel for the cooperating State agency, 
unless the Agreement is signed by the Governor or the chief elected 
official of the State. To become effective, in addition to an 
aforementioned State official signing and dating the Agreement, the 
Secretary must sign and date the Agreement on behalf of the United 
States. In the event that a State does not execute an Agreement under 
paragraph (a) of this section, then section 3302(c)(3) of the Internal 
Revenue Code of 1986 (26 U.S.C. 3302 (c)(3)) (loss of unemployment tax 
credits under section 3302(a) and (b)) applies.
    (c) Agent of the United States. A State that has executed an 
Agreement under this section is an agent of the United States for 
purposes of carrying out the terms of the Agreement, and the 
cooperating State agency must carry out fully the purposes of the Act 
and this part 618, including making determinations and redeterminations 
and in connection with proceedings for review thereof.
    (d) Merit staffing. A State need not apply the merit system 
standards of 5 CFR 900.603 to TAA program staff, except that employees 
who also perform other functions covered by the merit system must be 
merit staffed.
    (e) Contents. Each Agreement under this section must contain 
provisions including, but not limited to, the following:
    (1) Provisions consistent with the requirements of section 239 of 
the Act (19 U.S.C. 2311) providing for these Agreements;
    (2) Authorization for the cooperating State agency to issue waivers 
under Sec.  618.725 (waiver of the training requirement for basic TRA), 
and the

[[Page 50824]]

requirement that the cooperating State agency submit, upon request, to 
the Secretary a copy of each such waiver and, if not already contained 
within each waiver, a statement of the reasons for such waiver; and
    (3) The requirement that the cooperating State agency supply data 
to the Secretary on national TAA program performance goals identified 
in applicable regulations, the Department of Labor's written 
directives, or any other written means used to communicate such goals.
    (f) Public access to Agreements. The cooperating State agency must 
make available for inspection and copying an accurate copy of its 
Agreement under this section to any individual or organization that 
requests it. Copies of the Agreement may be furnished upon payment of 
the same charges, if any, as apply to the furnishing of copies of other 
records of the cooperating State agency.
    (g) Review of cooperating State agency compliance. The appropriate 
ETA Regional Administrator is responsible for monitoring and reviewing 
State and cooperating State agency compliance with the Agreement 
entered into under the Act and this section.
    (h) Breach. If the Secretary finds that the State or cooperating 
State agency has not fulfilled its commitments under its Agreement 
under this section, the Secretary may terminate the Agreement, disallow 
costs or impose such other sanctions as may be appropriate. In the 
event that the Secretary terminates the Agreement, section 3302(c)(3) 
of the Internal Revenue Code of 1986 (regarding loss of unemployment 
tax credits under section 3302(a) and (b)) applies. The Secretary must 
provide the State or cooperating State agency reasonable notice and 
opportunity for hearing before the Secretary makes a finding whether 
the State has not fulfilled its commitments under its Agreement.
    (i) Administration absent State Agreement. In any State in which no 
Agreement under this section is in effect, the Secretary must 
administer the Act and this part 618 and pay TAA hereunder through 
appropriate arrangements made by the Department. For this purpose, the 
Secretary or the Department is substituted for the State or cooperating 
State agency wherever appropriate under the Act and this part 618. Such 
arrangements must require that TAA be administered in accordance with 
this part 618 and the provisions of the applicable State law, except to 
the extent that such State law is inconsistent with this part 618, or 
section 303 of the Social Security Act (42 U.S.C. 503), or section 
3304(a) of the Internal Revenue Code of 1986 (26 U.S.C. 3304(a)). Any 
such arrangement must include a provision for a fair hearing for any 
individual whose application for TAA is denied. A final determination 
as to eligibility to TAA will be subject to review by the courts of 
competent jurisdiction as provided by 42 U.S.C 405(g), as required by 
section 240(b) of the Trade Act.


Sec.  618.810  Cooperating State agency rulemaking.

    A cooperating State agency may establish supplemental procedures 
not inconsistent with the Act or this part 618 or procedures prescribed 
by the Department to further effective administration of this part 618. 
The exact text of such supplemental procedure or procedures, certified 
as accurate by a responsible official, employee, or counsel of the 
cooperating State agency, must be submitted to the Department. No 
supplemental procedure may become effective unless and until approved 
by the Department. Approval may be granted on a temporary basis, not to 
exceed a period determined by the Secretary on a case-by-case basis, in 
cases of administrative necessity. On reasonable notice to a 
cooperating State agency, approval of a supplemental procedure may be 
withdrawn at any time. If public notice and opportunity for hearing 
would be required under either a State law for adoption of a similar or 
analogous procedure involving UI or other State or Federal law, the 
cooperating State agency must provide such public notice and 
opportunity for hearing as to the supplemental procedure.


Sec.  618.815  Subpoenas.

    A cooperating State agency may issue subpoenas to require 
attendance of witnesses and production of records on the same terms and 
conditions as under the State law in the determination of a worker's 
claim for TAA or to obtain information needed by the Department of 
Labor or the cooperating State agency in the petition determination 
process. The cooperating State agency may enforce compliance with 
subpoenas as provided under the State law and, if a State court 
declines to enforce a subpoena issued under this section, the 
cooperating State agency may petition for an order requiring compliance 
with such subpoena to the United States District Court with 
jurisdiction over the proceeding.


Sec.  618.820  TAA program and benefit information to workers.

    (a) Providing general program information and advice. Cooperating 
State agencies must provide full information and advice to workers 
about the benefits available under this part 618, and about the 
petition and application procedures and the appropriate filing 
deadlines for such benefits.
    (b) Rapid response assistance. Cooperating State agencies must 
ensure that rapid response assistance and appropriate core and 
intensive services, as described in section 134 of the Workforce 
Investment Act, as amended, are made available to workers for whom a 
petition under subpart B of this part 618 has been filed.
    (c) Providing reemployment services. Cooperating State agencies 
must provide to adversely affected workers reemployment services, 
including testing, counseling, assessment, selection and referral to 
training, placement services, and such other reemployment services as 
the Secretary may prescribe.
    (d) Petition filing assistance. Cooperating State agencies must 
provide whatever assistance is necessary to enable individuals and 
entities to prepare petitions or applications for program benefits. 
Cooperating State agencies must facilitate the early filing of 
petitions for any workers who, based on information received from 
sources, including but not limited to, the State's dislocated worker 
unit, reasonably may be eligible to apply for benefits under this part 
618. Cooperating State agencies may file petitions on behalf of groups 
of workers for whom petitions have not otherwise been filed.
    (e) Providing information after a certification is issued. (1) 
Cooperating State agencies must inform the State's board on vocational 
and technical education (also called the eligible agency, as defined in 
20 U.S.C. 2302(9)) or the equivalent agency in the State and other 
public or private agencies, institutions, and employers, as 
appropriate, of each certification issued under subpart B of this part 
618 and of projections, if available, of the needs for training under 
subpart F of this part 618 as a result of such certification.
    (2) Upon receipt of a certification issued under subpart B of this 
part 618 by the Department of Labor, the cooperating State agency must 
provide a written notice through the mail of the benefits available 
under this part 618 to each worker known to be covered by the 
certification when the worker becomes partially or totally separated or 
as soon as possible after the certification is

[[Page 50825]]

issued if the worker is already partially or totally separated from 
adversely affected employment. As part of its rapid response 
responsibilities under Sec.  618.320, cooperating State agencies are 
encouraged to provide notice of benefits to certified workers who have 
not yet been totally or partially separated but who have received 
notice of separation. The cooperating State agency must obtain from the 
firm, or another reliable source, the names and addresses of all 
workers who were partially or totally separated from adversely affected 
employment before the agency received the certification, and of all 
workers who are thereafter partially or totally separated within the 
certification period. The cooperating State agency must mail to each 
such worker a written notice that contains the following information:
    (i) The worker group(s) covered by the TAA or the TAA and ATAA 
certification, and the article(s) produced as specified in the copy of 
the certification furnished to the State agency.
    (ii) The name and the address or location of workers' firm.
    (iii) The impact, certification, and expiration dates in the 
certification document.
    (iv) A summary of benefits and reemployment services available to 
the workers.
    (v) An explanation of how, when, and where the workers may apply 
for TAA benefits and services.
    (vi) The training enrollment deadlines for TRA qualification.
    (vii) Whom to contact to get additional information on the 
certification.
    (3) Upon receipt of a copy of a certification issued by the 
Department affecting workers in a State, the cooperating State agency 
must publish a notice of the certification in a newspaper of general 
circulation in areas in which such workers reside. A newspaper notice 
is not required to be published, however, in the case of a 
certification with respect to which the cooperating State agency can 
substantiate, and enters in its records evidence substantiating, that 
all workers covered by the certification have received the written 
notice required by paragraph (c)(2) of this section. The published 
notice must include the same information identified in paragraphs 
(e)(2)(i) through (e)(2)(vii) of this section.
    (f) Specific benefit assistance to workers. Cooperating State 
agencies must--
    (1) Advise each adversely affected worker, as soon as practicable 
after the worker is separated from adversely affected employment or, if 
later, after a certification is issued, of the benefits and services 
available under this part 618, and of the qualifying requirements, 
procedures, and deadlines for applying for such benefits and services.
    (2) Interview each adversely affected worker unless the worker 
declines the interview, as soon as practicable after the worker is 
separated from adversely affected employment or after a certification 
is issued. The interview must be scheduled in time for the worker to 
meet the 8 week or 16 week deadlines for enrollment in training. The 
interview must include, when appropriate, information about suitable 
training opportunities available to the worker under subpart F of this 
part 618, about jobs available in the labor market for workers with 
marketable skills, and about a waiver under Sec.  618.725.
    (3) Provide information on ATAA benefits and deadlines, including 
informing the potentially eligible worker that the worker must make a 
choice between TAA and ATAA benefits and services, if ATAA is included 
in the certification.
    (4) Provide information about:
    (i) The health coverage tax credit (HCTC) available to eligible TAA 
program recipients and eligible ATAA program recipients (as defined in 
Sec.  618.110), as provided under section 35 of the Internal Revenue 
Code of 1986. Information provided to workers about the HCTC must 
include guidance on how to contact the appropriate division of the 
Internal Revenue Service for more detailed eligibility and benefit 
information about the HCTC;
    (ii) The second COBRA election opportunity (a second period during 
which HCTC-eligible individuals, who did not elect COBRA coverage 
during the first election period, may elect coverage under COBRA, which 
provides an individual and his/her family temporary continuation of 
health insurance coverage under the individual's previous employer-
provided health insurance plan) available to eligible TAA recipients 
and eligible ATAA recipients (as defined in Sec.  618.110) under the 
Employee Retirement Income Security Act of 1974 (ERISA), the Internal 
Revenue Code of 1986, and the Public Health Service Act. Information 
provided to workers about the second COBRA election period must include 
guidance on how to contact the appropriate division of the Internal 
Revenue Service for more detailed eligibility and benefit information 
about the second COBRA election period.


Sec.  618.825  Determinations of eligibility; notices to individuals.

    (a) Determinations of initial applications. The cooperating State 
agency whose State law is the applicable State law under Sec.  618.110 
must, upon the filing of an initial application, promptly determine the 
individual's eligibility to TAA or ATAA under this part 618, and may 
accept for such purposes information and findings supplied by another 
cooperating State agency.
    (b) Determinations of subsequent applications. The cooperating 
State agency must, upon the filing of an application for payment of 
TRA, ATAA, or subsistence and transportation, promptly determine 
whether the individual is eligible for such payment, and, if eligible, 
the amount of such payment, for which the worker is eligible. In 
addition, the cooperating State agency must, upon the filing of a 
subsequent application for a job search allowance (where the total of 
previous job search allowances paid the worker was less than the 
statutory dollar limit), promptly determine whether the worker is 
eligible for a job search allowance, and, if eligible, the amount of 
the job search allowance for which the worker is eligible.
    (c) Redeterminations. The provisions of the applicable State law 
concerning the right to request, or authority to undertake, 
reconsideration of a determination on a claim for UI applies to 
determinations on all forms of TAA and on ATAA under this part 618.
    (d) Use of State law. In making determinations or redeterminations 
under this section, or in reviewing such determinations or 
redeterminations under Sec.  618.835, a cooperating State agency must 
apply the regulations in this part 618. As to matters committed by this 
part 618 to be decided under the applicable State law, a cooperating 
State agency, a hearing officer, or a State court must apply the 
applicable State law and regulations thereunder, including the 
procedural requirements of the applicable State law or regulations: 
Provided, that, no provision of State law or regulations on good cause 
for waiver of any time limit, or for late filing of any claim, will 
apply to any time limitation referred to or specified in this part 618, 
unless such State law or regulation is made applicable by a specific 
provision of this part 618.
    (e) Notices to individuals. The cooperating State agency must 
notify the individual in writing of any determination or 
redetermination of eligibility to TAA or ATAA. Each determination or 
redetermination must inform the individual of the reason for

[[Page 50826]]

the determination or redetermination and of the right to 
reconsideration or appeal in the same manner as determinations of 
entitlement to UI are subject to redetermination or appeal under the 
applicable State law.
    (f) Promptness. Cooperating State agencies must make full payment 
of TAA and ATAA when due with the greatest promptness that is 
administratively feasible.
    (g) Procedure. The procedures for making and furnishing 
determinations and written notices of determinations to individuals, 
must be consistent with the Secretary's ``Standard for Claim 
Determinations--Separation Information,'' Employment Security Manual, 
Part V, sections 6010-6015 (appendix B of part 617 of this chapter).


Sec.  618.830  Liable State and agent State responsibilities.

    (a) Liable State. The liable State is responsible for:
    (1) Making all determinations, redeterminations, and decisions on 
appeals on all claims for program benefits under this part 618, 
including job search allowances under subpart D; relocation allowances 
under subpart E; training under subpart F; subsistence and 
transportation payments under Sec.  618.640; basic, additional, and 
remedial TRA under subpart G; waivers and revocations of waivers under 
Sec.  618.725; and ATAA;
    (2) Providing workers with general program information and advice 
under Sec.  618.820(a) and petition filing assistance under Sec.  
618.820(d);
    (3) Providing rapid response assistance under Sec.  618.320 upon 
receiving a copy of a petition filed on behalf of a group of workers at 
a firm or appropriate subdivision in the State;
    (4) Providing information and assistance to adversely affected 
workers under paragraphs (c) (reemployment services), (e) (information 
after a certification is issued), and (f) (specific benefit assistance 
to workers) of Sec.  618.820 upon receiving a certification issued by 
the Department with respect to affected workers at a firm or 
appropriate subdivision in the State;
    (5) Providing reemployment services as provided under this part 618 
to adversely affected workers covered by a certification issued by the 
Department under this part;
    (6) Providing a list of eligible TAA recipients and eligible ATAA 
recipients (as defined in Sec.  618.110) to the Internal Revenue 
Service under Sec.  618.770; and
    (7) Assisting in other activities and functions required by the 
State's Agreement with the Secretary under Sec.  618.805.
    (b) Agent State. The agent States is responsible for:
    (1) Cooperating fully with and assisting the liable State in 
carrying out its responsibilities, activities, and functions;
    (2) Cooperating with the liable State in taking applications and 
claims for TAA and ATAA;
    (3) Providing interstate claimants with general program information 
and advice under Sec.  618.820(a) and petition filing assistance under 
Sec.  618.820(d);
    (4) Providing employment services under subparts C, D, E, F, G, and 
I of this part to adversely affected workers covered by a certification 
issued by the Department;
    (5) Cooperating with the liable State by providing information that 
the liable State needs for it to issue determinations, 
redeterminations, and decisions on appeals on all claims for program 
benefits under this part 618, as described in paragraph (a)(1) of this 
section;
    (6) Procuring and paying the cost of any approved training under 
subpart F, and subsistence and transportation payments under Sec.  
618.640, according to determinations issued by the liable State; and
    (7) Assisting in other activities and functions required by the 
State's Agreement with the Secretary under Sec.  618.805.


Sec.  618.835  Appeals and hearings.

    (a) Applicable State law. Except as provided below in paragraph 
(b), a determination or redetermination under this part 618 is subject 
to review in the same manner and to the same extent as UI 
determinations and redeterminations under the applicable State law, and 
only in that manner and to that extent. Proceedings for review of a 
determination or redetermination may be consolidated or joined with 
proceedings for review of other determinations or redeterminations 
under the applicable State law where convenient or necessary. 
Procedures as to the right of appeal and opportunity for fair hearing 
must be consistent with sections 303(a)(1) and (3) of the Social 
Security Act (42 U.S.C. 503(a)(1) and (3)).
    (b) Allegations of discrimination. Complaints alleging that a 
determination or redetermination under this part 618 violates 
applicable Federal nondiscrimination laws administered by the U.S. 
Department of Labor must be filed in accordance with the procedures of 
29 CFR parts 31, 32, 35, 36, and/or 37, as provided in Sec.  618.875(i) 
(nondiscrimination and equal opportunity requirements).
    (c) Appeals promptness. Appeals under paragraph (a) of this section 
must be decided with a degree of promptness meeting the Secretary's 
``Standard on Appeals Promptness--Unemployment Compensation'' (Part 650 
of this chapter). Any provisions of the applicable State law for 
advancement or priority of UI cases on judicial calendars, or otherwise 
intended to provide for prompt payment of UI when due, must apply 
equally to proceedings involving eligibility to TAA under this part 
618.


Sec.  618.840  Overpayments; penalties for fraud.

    (a) Determination and repayment. If a cooperating State agency or a 
court of competent jurisdiction determines that any person has received 
any payment under this part 618 to which the person was not entitled, 
including a payment referred to in paragraph (f) or paragraph (g) of 
this section, such person will be liable to repay such amount to the 
cooperating State agency, and the cooperating State agency must recover 
any such overpayment in accordance with the provisions of this section 
except that the cooperating State agency may, in accordance with 
paragraphs (b) through (e) of this section, waive the recovery of any 
such overpayment.
    (b) Waiver of overpayment recovery; State option. Each cooperating 
State agency has the option to decide whether to permit waiver of 
recovery of overpayments determined under paragraph (a) of this 
section. However, a cooperating State agency that decides to permit 
such waiver must apply the waiver provisions of this section and 
document that its waiver rules meet the requirements of this section. A 
cooperating State agency's decision whether to permit waiver of TAA 
overpayment recovery will not be controlled by whether it waives UI 
overpayment recovery. The State's decision whether to permit waiver of 
TAA overpayment recovery must be published for the information of the 
public and must be provided to the Department.
    (c) Waiver of overpayment recovery; requests for waiver. In States 
which permit waivers of overpayments, notices of a determination of 
overpayments must include an accurate description of the waiver 
provisions of this section. Determinations granting or denying waivers 
of overpayment recovery under this section must be made only on a 
request for a waiver determination by the affected person. The request 
must be made on a form furnished to the person by the cooperating State 
agency.

[[Page 50827]]

    (d) Waiver of overpayment recovery; general waiver criteria. The 
cooperating State agency may waive the recovery of any overpayment 
determined under paragraph (a) of this section if the agency 
determines:
    (1) The payment was made without fault on the part of such person, 
in accordance with paragraphs (e)(1) and (e)(2) of this section; and
    (2) Requiring repayment would be contrary to equity and good 
conscience, in accordance with paragraphs (e)(3) through (e)(5) of this 
section.
    (e) Waiver of overpayment recovery; specific waiver criteria. (1) 
In determining whether fault exists for purposes of paragraph (d)(1) of 
this section, the following factors must be considered:
    (i) Whether the person made a material statement or representation 
in connection with the application for TAA that resulted in the 
overpayment, and whether the person knew, or should have known, that 
the statement or representation was inaccurate.
    (ii) Whether the person failed, or caused another to fail, to 
disclose a material fact in connection with an application for TAA that 
resulted in the overpayment, and whether the person knew, or should 
have known, that the fact was material.
    (iii) Whether the person knew, or should have known, that the 
person was not entitled to the TAA payment.
    (iv) Whether, for any other reason, the overpayment resulted 
directly or indirectly, and partially or totally, from any act or 
omission of the person or of which the person had knowledge, and which 
was erroneous or inaccurate or otherwise wrong.
    (v) Whether there has been a determination of fraud under paragraph 
(f) of this section or section 243 of the Act.
    (2) An affirmative finding on any one of the factors in this 
paragraph (e)(1) precludes waiver of overpayment recovery.
    (3) In determining whether equity and good conscience exists for 
purposes of paragraph (d)(2) of this section, the following factors 
must be considered:
    (i) If the overpayment was the result of a decision on appeal, 
whether the cooperating State agency had given notice to the person 
that the case had been appealed; that the person may be required to 
repay the overpayment in the event of a reversal on appeal; and 
recovery of the overpayment will not cause extraordinary and lasting 
financial hardship to the person.
    (ii) If the overpayment was not the result of an appeal, whether 
recovery of the overpayment will not cause extraordinary financial 
hardship to the person and whether the person was notified that he or 
she was liable for repaying it.
    (4) An affirmative finding on either of the factors in this 
paragraph (e)(3) precludes waiver of overpayment recovery.
    (5)(i) For the purpose of paragraph (e)(3) of this section, an 
extraordinary financial hardship exists if recovery of the overpayment 
would result directly in the person's loss of or inability to obtain 
minimal necessities of food, medicine, and shelter for a substantial 
period of time; and a lasting financial hardship is one that may be 
expected to endure for the foreseeable future.
    (ii) In applying this test in the case of attempted recovery by 
repayment, a substantial period of time is 30 days, and the foreseeable 
future is at least three months. In applying this test in the case of 
proposed recoupment from other benefits, a substantial period of time 
and the foreseeable future are the longest potential period of benefit 
eligibility as measured at the time of the request for a waiver 
determination. In making these determinations, the cooperating State 
agency must take into account all potential income of the person and 
the person's wholly or family-owned business, or family and all cash 
resources available or potentially available to the person and the 
person's wholly or family-owned, or family in the time period being 
considered.
    (f) Fraud. If a cooperating State agency or a court of competent 
jurisdiction finds that any person:
    (1) Knowingly has made, or caused another to make, a false 
statement or representation of a material fact; or
    (2) Knowingly has failed, or caused another to fail, to disclose a 
material fact; and as a result of such false statement or 
representation, or of such nondisclosure, such person has received any 
payment under this part 618 to which the person was not entitled, such 
person will, in addition to any other penalty provided by law, forever 
more be ineligible for any further payments under this part 618.
    (g) Training, job search and relocation allowances. (1) If an 
adversely affected worker fails, with good cause, to complete training, 
a job search, or a relocation, then the payments for such benefit are 
not overpayments.
    (2) If an adversely affected worker fails, without good cause, to 
complete training, a job search, or a relocation, then any payments for 
such benefits are overpayments.
    (3) If an adversely affected worker fails, with good cause, to 
complete part of the training, job search, or relocation and that 
worker also fails, without good cause, to complete another part of the 
training, job search, or relocation, then any payment for the benefit 
accruing from the failure to complete training, job search, or 
relocation without good cause are overpayments.
    (4) For purposes of this paragraph (g), an adversely affected 
worker has good cause if there exist such reasons that would cause a 
reasonable person in like circumstances not to complete TAA program 
benefits and services. The cooperating State agency must determine 
whether good cause exists on a case-by-case basis.
    (5) An overpayment established under this paragraph (g) may be 
recovered or may be waived as provided in this section.
    (h) Final determination. Except for overpayments determined by a 
court of competent jurisdiction, no repayment may be required, and no 
deduction may be made, under this section until the cooperating State 
agency has made a determination under paragraph (a) of this section, 
and has provided the person concerned a notice of the determination and 
an opportunity for a fair hearing thereon, and the determination has 
become final.
    (i) Overpayment recovery by offset. Unless an overpayment is 
otherwise recovered, or is waived under paragraphs (b) through (e) of 
this section, the cooperating State agency--
    (1) Must, subject to the limitation in paragraph (i)(4) of this 
section, recover the overpayment by deduction from any sums payable to 
such person under:
    (i) This part 618;
    (ii) Any Federal UI law administered by the State agency; or
    (iii) Any other Federal law administered by the State agency that 
provides for the payment of unemployment assistance or an allowance 
with respect to unemployment.
    (2) Must, if the State has a cross-program offset Agreement with 
the Secretary in effect under authority of 42 U.S.C. 503(g)(2), and 
subject to the limitation in paragraph (i)(4) of this section, recover 
the overpayment from UI payable to such person under the applicable 
State law.
    (3) May, if the State does not have a cross-program offset 
Agreement with the Secretary in effect under authority of 42 U.S.C. 
503(g)(2), and subject to the limitation in paragraph (i)(4) of this 
section, recover the overpayment from UI payable to such person under 
the State law.
    (4) Must not allow any single deduction under this paragraph (i) to

[[Page 50828]]

exceed 50 percent of the amount otherwise payable to the person; except 
that if the applicable State law provides for an overpayment recovery 
deduction that is less than 50 percent of the amount otherwise payable, 
such recovery must be equal to that lesser percentage.
    (j) Deposit. Any amount recovered by a cooperating State agency 
under this section must be deposited into the Federal fund or account 
from which payment was made.
    (k) Procedural requirements. The provisions of paragraphs (c), (e), 
and (g) of Sec.  618.830 and Sec.  618.835 apply to determinations and 
redeterminations made under this section.
    (l) Fraud detection and prevention. State procedures for the 
detection and prevention of fraudulent overpayments of TAA and ATAA 
must be, at a minimum, no less rigorous than those the State has 
adopted with respect to State unemployment compensation, and consistent 
with the Secretary's ``Standard for Fraud and Overpayment Detection,'' 
Employment Security Manual, Part V, sections 7510-7515 (Appendix C of 
this Part).
    (m) Person. For purposes of this section and Sec.  618.845 
(recovery of debts due the United States or others by TAA offset), a 
person includes, in addition to an adversely affected worker or other 
individual, any employer or other entity or organization as well as the 
officers and officials thereof, any training institution as well as the 
officers and officials thereof, who may bear personal responsibility 
for the overpayment.


Sec.  618.845  Recovery of debts due the United States or others by TAA 
offset.

    (a) Debt due the United States. Notwithstanding any other provision 
of this part 618, the State agency must apply TAA and ATAA, payable 
under this part to a person (as described in Sec.  618.840(m)), for the 
recovery by offset of any debt due the United States from the person.
    (b) Debt due to others. The State agency must not apply or use TAA 
and ATAA, in any manner for the payment of any debt of any person to 
any State or any other entity or person, except as provided by the 
applicable State law for UI.


Sec.  618.850  Uniform interpretation and application of the Act and 
regulations.

    (a) First rule of construction. The Act and the implementing 
regulations in this part 618 will be construed liberally to carry out 
the purposes of the Act.
    (b) Second rule of construction. The Act and the implementing 
regulations in this part 618 will be construed to assure, insofar as 
possible, the uniform interpretation and application of the Act and 
this part 618 throughout the United States.
    (c) Effectuating purposes and rules of construction. (1) To 
effectuate the purposes of the Act and this part 618 and to assure 
uniform interpretation and application of the Act and this part 618 
throughout the United States, a cooperating State agency must, upon 
request, forward to the Department a copy of any administrative or 
judicial ruling on an individual's eligibility to TAA and ATAA under 
this part 618.
    (2)(i) If the Department believes that a determination, 
redetermination, or decision is inconsistent with the Department's 
interpretation of the Act or this part 618, the Department may at any 
time notify the cooperating State agency of the Department's view. The 
cooperating State agency must issue a redetermination or must appeal, 
if possible. The cooperating State agency also must not follow such 
determination, redetermination, or decision as a precedent. In any 
subsequent proceedings which involve such determination, 
redetermination, or decision, or in which such determination, 
redetermination, or decision is cited as precedent or otherwise relied 
upon, the cooperating State agency must inform the decision maker of 
the Department's view and must make all reasonable efforts, including 
appeal or other proceedings in an appropriate forum, to obtain 
modification, limitation, or a reversal of the determination, 
redetermination, or decision.
    (ii) If the determination, redetermination, or decision in question 
awards TAA or ATAA to an individual, the benefits are ``due'' within 
the meaning of section 303(a)(1) of the Social Security Act (42 U.S.C. 
503(a)(1)), and therefore must be paid promptly to the individual. 
Payments to the individual may be temporarily delayed if 
redetermination is issued or appeal is filed not more than one business 
day following the day on which the first payment otherwise would be 
issued to the individual; and the cooperating State agency seeks an 
expedited appeal decision within not more than two calendar weeks after 
the appeal is filed. If the redetermination is not issued or the appeal 
is not filed within the above time limit, or the decision on appeal is 
not obtained within the above two-calendar week limit, or any decision 
on appeal is issued which affirms the determination, redetermination, 
or decision awarding TAA or ATAA or allows it to stand in whole or in 
part, the benefits awarded must be paid promptly to the individual.
    (iii) A State may request in writing, within 10 calendar days of 
receiving a notice under paragraph (c)(2) of this section, 
reconsideration of the notice. The State will be given an opportunity 
to present its views and arguments if desired. The request must be made 
to the Secretary and may include views and arguments on the matters to 
be decided by the Secretary under paragraph (c)(3) of this section. The 
Secretary must respond to the State's reconsideration request within 30 
calendar days of receiving the request. (3)(i) If any determination, 
redetermination, or decision referred to in paragraph (c)(2) of this 
section is treated as a precedent for any future application for TAA or 
TAA and ATAA, the Secretary will decide whether to terminate the 
Agreement with the State entered into under the Act and this part 618, 
and whether to apply Sec.  618.805(h) (agreements with the Secretary of 
Labor).
    (ii) In the case of any determination, redetermination, or decision 
that is not legally warranted under the Act or this part 618, including 
any determination, redetermination, or decision referred to in 
paragraph (c)(2) of this section, the Secretary will decide whether the 
State will be required to restore to the United States any sums paid 
under such a determination, redetermination, or decision, and whether, 
in the absence of such restoration, to terminate the Agreement with the 
State, and whether to apply Sec.  618.805(h), or whether to take other 
action to recover such sums for the United States.
    (4) A State may not presume the Department's concurrence in a 
determination, redetermination, or decision from the absence of a 
notice issued under this section.


Sec.  618.855  Inviolate rights to TAA or ATAA.

    Except as specifically provided in this part 618, the rights of 
individuals to TAA or ATAA must be protected in the same manner and to 
the same extent as the rights of persons to UI are protected under the 
applicable State law. Such measures must include protection of 
applicants for TAA or TAA and ATAA from waiver, release, assignment, 
pledge, encumbrance, levy, execution, attachment, and garnishment of 
their rights to TAA or ATAA, except as provided in Sec. Sec.  618.840 
(overpayments; penalties for fraud) and 618.845 (recovery of debts due 
the United States or others by TAA offset). In the same manner and to 
the same extent, individuals must be protected from discrimination and 
obstruction in regard

[[Page 50829]]

to seeking, applying for, and receiving any right to TAA or ATAA.


Sec.  618.860  Veterans' priority of service.

    The Jobs for Veterans Act of 2002 (38 U.S.C. 4215(b)) establishes a 
priority of service for covered persons who otherwise meet the 
eligibility requirements for participation in TAA programs. Such 
covered persons include veterans, as well as spouses of any veteran who 
died of a service connected disability, has a total disability 
resulting from a service connected disability, or died while a 
disability so evaluated was in existence, or spouses of any member of 
the Armed Forces serving on active duty who are listed for a total of 
more than 90 days as missing in action, captured, or forcibly detained. 
The cooperating State agency must give the highest priority for 
approval and funding of TAA program benefits (including training, where 
the approval of training criteria are met) to an adversely affected 
worker meeting the veterans' priority of service criteria.


Sec.  618.865  Recordkeeping and disclosure of information 
requirements.

    (a) Recordkeeping. Each cooperating State agency must make and 
maintain such records pertaining to the administration of the Act as 
the Secretary requires and must make all such records available for 
inspection, examination and audit by such Federal officials as the 
Secretary may designate or as may be required by law. Cooperating State 
agencies must maintain records that contain any information that the 
Department determines to be appropriate in support of any reports that 
the Department may require, including those reports specified in 
Sec. Sec.  618.875(j) (general fiscal and administrative requirements) 
and 618.880(e) (TAA program performance).
    (b) Disclosure of information. Each State must keep confidential 
any information it receives about each applicant for any benefit or 
service under the Act in the course of fulfilling its obligations under 
the Act and this part 618 to the extent required under all applicable 
State and Federal laws. Each State also must keep confidential any 
confidential business information, as defined in Sec.  618.110, that it 
obtains or receives in the course of fulfilling its obligations under 
the Act and this part 618 and must not disclose such information to any 
person, organization, or entity except as directed by the Secretary, a 
court, or as required by applicable State and Federal laws. This 
provision on the confidentiality of information maintained in the 
administration of the Act does not apply, however, to disclosures to 
the Department. This provision on confidentiality also does not apply 
to disclosures either for the purposes of Sec.  618.840 or paragraph 
(a) of this section, or to provide information, reports and studies 
required by Sec.  618.870 (information, reports, and studies), or where 
nondisclosure would be inconsistent with the Freedom of Information Act 
(5 U.S.C. 552), the Privacy Act of 1974 (5 U.S.C. 552a), or regulations 
of the Department promulgated thereunder (see 29 CFR parts 70 and 70a).


Sec.  618.870  Information, reports, and studies.

    (a) A cooperating State agency must furnish to the Secretary such 
information and reports, including the reports required by Sec. Sec.  
618.875(j) (general fiscal and administrative requirements) and 618.880 
(TAA program performance), and conduct such studies as the Secretary 
determines are necessary or appropriate to carry out the purposes of 
the Act and this part 618. A cooperating State agency must submit 
financial and non-financial reports on activities conducted with TAA 
program funds to the Department in accordance with reporting 
instructions approved by the Office of Management and Budget as to the 
content, frequency, and due dates.
    (b) The Department may reduce the administrative funding of 
cooperating State agencies that fail to submit accurate and timely 
reports. Cooperating State agencies submitting reports that cannot be 
validated or verified as accurately counting and reporting activities 
in accordance with the reporting instructions may be treated as failing 
to submit reports.


Sec.  618.875  General fiscal and administrative requirements.

    (a) Uniform fiscal and administrative requirements. (1) Each 
cooperating State agency receiving funds allocated for the TAA program 
funds from the Department as an agent of the United States must 
administer the TAA program in accordance with the ``Uniform 
Administrative Requirements for Grants and Cooperative Agreements to 
State and Local Governments'' at 29 CFR part 97. Paragraphs (a)(2) 
through (a)(5) of this section further elaborate upon the application 
of 29 CFR part 97 to the administration of the TAA program.
    (2) Unless indicated otherwise in the TAA Annual Cooperative 
Financial Agreement between a State and the Department, or in a State 
subaward instrument (and as elaborated in paragraphs (a)(3) through 
(a)(5) of this section), a recipient of funds allocated for the TAA 
program (whether administrative or benefit fund expense categories) 
under a subaward from a State must abide by the administrative 
requirements provided in this paragraph (a)(2). Specifically, units of 
State, local, or Indian tribal government must abide by the regulations 
at 29 CFR part 97. Institutions of higher education, hospitals, other 
non-profit organizations, and commercial organizations must abide by 
the ``Uniform Administrative Requirements for Grants and Other 
Agreements with Institutions of Higher Education, Hospitals and Other 
Non-Profit Organizations'' at 29 CFR part 95.
    (3) Funds awarded to a State during a Federal fiscal year to carry 
out TAA program activities under sections 235 through 238 of the Act 
(but not sections 231 through 234 of the Act) may be expended by the 
State during that Federal fiscal year and the succeeding two Federal 
fiscal years.
    (4) Equipment, as described in 29 CFR 97.32 and Appendix B of 
``Cost Principles for State, Local and Indian Tribal Governments'' at 2 
CFR part 225, includes equipment acquired with TAA administrative funds 
under both current and prior Agreements.
    (5) The addition method, described at 29 CFR 95.24 or 29 CFR 
97.25(g)(2) (as appropriate), must be used for all program income 
earned under TAA grants. When the cost of generating program income has 
been charged to such grant, the gross amount earned must be added to 
such grant. However, when these costs have not been charged to such 
grant, the cost of generating program income must be subtracted from 
the amount earned to establish the net amount of program income 
available for use under such grant.
    (b) General allowable costs/cost principles. (1) All recipients and 
subrecipients must follow the Federal allowable cost principles that 
apply to their kind of organization. The DOL regulations at 29 CFR 
95.27 and 29 CFR 97.22(b) identify the Federal principles for 
determining allowable costs which each kind of recipient and 
subrecipient must follow. The applicable Federal principles for each 
kind of recipient are described in paragraphs (b)(2) through (b)(6) of 
this section, while paragraph (b)(7) of this section applies to all 
recipients of TAA administrative funds.
    (2) Allowable costs for State, local, and Indian tribal government 
organizations must be determined under ``Cost Principles for State, 
Local and Indian Tribal Governments'' at 2 CFR part 225.

[[Page 50830]]

    (3) Allowable costs for non-profit organizations must be determined 
under ``Cost Principles for Non-Profit Organizations'' at 2 CFR part 
230.
    (4) Allowable costs for institutions of higher education must be 
determined under ``Cost Principles for Educational Institutions'' at 2 
CFR part 220.
    (5) Allowable costs for hospitals must be determined in accordance 
under appendix E of 45 CFR part 74, ``Principles for Determining Costs 
Applicable to Research and Development Under Grants and Contracts with 
Hospitals.''
    (6) Allowable costs for commercial organizations and those non-
profit organizations listed in Attachment C to ``Cost Principles for 
Non-Profit Organizations'' at 2 CFR part 230, must be determined under 
the provisions of the Federal Acquisition Regulation at 48 CFR part 31.
    (7) The administrative cost limit for the fiscal year program 
funding allocation for training, job search assistance, and relocation 
allowances is included in the TAA Annual Cooperative Financial 
Agreement, with which States must comply.
    (c) Claims against the Federal Government. For all types of 
entities, legal expenses for the prosecution of claims against the 
Federal Government, including appeals to an Administrative Law Judge, 
are unallowable.
    (d) Lobbying Costs. In accordance with the restrictions on lobbying 
at 29 CFR part 93, no TAA program funds may be charged for salaries or 
expenses related to any activity designed to influence appropriations 
or other legislation pending before the Congress of the United States 
or any State legislature.
    (e) Employee Fringe Benefits. As an exception to 2 CFR part 225 
with respect to personnel benefit costs incurred on behalf of State 
Workforce Agency (SWA) employees who are members of fringe benefit 
plans which do not meet the requirements of Attachment B, item 11, in 
``Cost Principles for State, Local, and Indian Tribal Governments'' at 
2 CFR part 225, the costs of employer contributions or expenses 
incurred for SWA fringe benefit plans are allowable, provided that:
    (1) All fringe benefit plans covered in paragraphs (e)(2) and 
(e)(3) of this section were approved by the Secretary before October 1, 
1983; and all covered employees joined the plan before October 1, 1983; 
and any additional costs resulting from improvements to the plans made 
after October 1, 1983 are not chargeable to DOL grant funds; and the 
State agrees to refund to the Department of Labor any amount refunded 
to the State by the carrier at the termination of the plan or at the 
time the last beneficiary dies, whichever is later.
    (2) For retirement plans, the plan is authorized by State law; and 
the plan is insured by a private insurance carrier which is licensed to 
operate this type of plan in the State; and any dividends or similar 
credits because of participation in the plan are credited against the 
next premium falling due under the contract.
    (3) For SWA fringe benefit plans other than retirement plans, costs 
of the plan are allowable until such time as the plan is comparable in 
cost and benefits to fringe benefit plans available to other similarly 
employed State employees, after which time the requirements of 2 CFR 
part 225 cited in this paragraph (e) will apply.
    (f) Prior Approval of Equipment Purchases. As provided in 
Attachment B, item 19.c. of ``Cost Principles for State, Local and 
Indian Tribal Governments'' at 2 CFR part 225, the requirement that 
grant recipients obtain prior approval from the Federal grantor agency 
for all purchases of equipment (as defined in 29 CFR 97.3) is waived, 
and approval authority is delegated to the cooperating State agency, 
except that the Secretary reserves the right to require transfer of 
title to Automated Data Processing Equipment in accordance with 29 CFR 
97.32(g). Prior Federal approval of real estate purchases is not waived 
or delegated.
    (g) Audit requirements. (1) All States, local governments, and non-
profit organizations that are recipients or subrecipients of TAA or 
ATAA program funds must follow the audit requirements under 29 CFR 
parts 96 and 99. Further implementing requirements for governmental 
organizations, and for institutions of higher education, hospitals, and 
other non-profit organizations, are at, respectively, 29 CFR 97.26 and 
29 CFR 95.26. Organizations that expend more than the minimum level 
specified in 29 CFR part 99 must have either an organization-wide audit 
conducted in accordance with 29 CFR parts 96 and 99.
    (2) Commercial organizations that are subrecipients of TAA or ATAA 
program funds and expend more than the minimum level specified in 29 
CFR part 99 must have either an organization-wide audit conducted in 
accordance with 29 CFR parts 96 and 99 or a program-specific financial 
and compliance audit.
    (h) Government-wide debarment and suspension, and government-wide 
drug-free workplace requirements. All TAA program fund recipients and 
subrecipients must comply with the government-wide requirements for 
debarment and suspension, and the government-wide requirements for a 
drug-free workplace at 29 CFR part 98.
    (i) Nondiscrimination and equal opportunity requirements.
    (1) Cooperating State agencies and subrecipients of financial 
assistance under the TAA program are required to comply with the 
nondiscrimination and equal opportunity provisions codified in the 
Department's regulations at 29 CFR parts 31, 32, 35, and 36.
    (2) Cooperating State agencies and subrecipients of financial 
assistance under the TAA program are required to comply with the 
nondiscrimination and equal opportunity provisions codified in the 
Department's regulations at 29 CFR part 37 if the agency or 
subrecipient:
    (i) Operates its TAA programs and activities as part of the One-
Stop delivery system established under the Workforce Investment Act of 
1998, as amended (WIA); or
    (ii) Otherwise satisfies the definition of ``recipient'' in 29 CFR 
37.4.
    (3) Questions about, or complaints alleging violation of, the 
nondiscrimination requirements cited in this section may be directed to 
the Director, Civil Rights Center, U.S. Department of Labor, Room N-
4123, 200 Constitution Avenue, NW., Washington, DC 20210. Complaints 
alleging violations of the WIA nondiscrimination regulations at 29 CFR 
part 37 may also be filed at the State agency or subrecipient level. 
See 29 CFR 37.71 and 37.76. All such complaints must be processed using 
procedures that comply with the requirements in 29 CFR part 37.
    (4)(i) This Sec.  617.875(i) is not intended to, and does not, 
affect any rights regarding, or protections against, discrimination 
that are provided under any other applicable Federal laws prohibiting 
discrimination, any applicable State or local laws related to 
discrimination, or their implementing regulations, except as provided 
in paragraphs (i)(4)(ii) and (iii).
    (ii) The obligation to comply with the nondiscrimination and equal 
opportunity provisions of 29 CFR parts 31, 32, 35, 36, and/or 37 is not 
excused or reduced by any State or local law or other requirement that 
uses race, color, religion, sex, age, disability, political affiliation 
or belief as a basis for prohibiting or limiting an individual's 
eligibility for any of the following:
    (A) Receiving aid, benefits, services, training, or employment;
    (B) Participating in any TAA program or activity;

[[Page 50831]]

    (C) Being employed by any cooperating State agency; or
    (D) Practicing any occupation or profession.
    (iii) The obligation to comply with the nondiscrimination and equal 
opportunity provisions of 29 CFR part 37 is not excused or reduced by 
any State or local law or other requirement that permits or requires 
discrimination against beneficiaries of the TAA program on the basis 
of:
    (A) Participation in a program or activity that is financially 
assisted under title I of WIA; or
    (B) Citizenship or status as a non-citizen lawfully admitted to 
work in the United States.
    (j) Fiscal reporting requirements for cooperating State agencies. 
(1) In accordance with 29 CFR 97.41, each cooperating State agency must 
submit a quarterly financial status report (QFSR) to the Department. 
The QFSR must be submitted in electronic format via the Internet within 
30 days after the end of each quarter. Each cooperating State agency 
must also submit a final QFSR to the Department within 90 days after 
the end of the grant period. The Department will provide instructions 
for the preparation of this report.
    (2) Financial data must be reported on an accrual basis, and 
cumulatively by funding year of appropriation. Financial data may also 
be required on specific program activities.
    (3) If the cooperating State agency's accounting records are not 
normally kept on the accrual basis of accounting, the cooperating State 
agency must develop accrual information through an analysis of the 
documentation on hand.


Sec.  618.880  TAA program performance.

    (a) General rule. Each State that has an Agreement with the 
Secretary in effect under Sec.  618.805 must report its TAA program 
performance to the Department as provided in this section.
    (b) Performance categories. States must report program data 
necessary to calculate performance in the following categories:
    (1) Entered employment.
    (2) Retention in employment.
    (3) Average earnings.
    (4) Any additional categories established by the Department.
    (c) Performance measures.
    (1) States must report program performance using the following 
measures for the categories in paragraphs (b)(1) through (b)(4) of this 
section:
    (i) Entered employment--the percentage of program participants 
employed within a period of time, established by the Department under 
paragraph (c)(2) of this section, after exiting the program;
    (ii) Retention in employment--of those program participants who 
have entered employment, the percentage of program participants who 
remain employed after a period of time, established by the Department 
under paragraph (c)(2) of this section;
    (iii) Average earnings--the average earnings per participant over a 
time interval, established by the Department under paragraph (c)(2) of 
this section;
    (iv) Any other measures established by the Department.
    (2) The Department will establish the timeframes used in the 
measurements for paragraphs (c)(1)(i) through (c)(1)(iii) of this 
section, and the definitions for specified terms for paragraph 
(c)(1)(iii) of this section, and will set the units of cost and 
timeframes used in paragraph (c)(1)(iv) of this section. The Department 
will provide further instructions on such timeframes, definitions of 
the measures, and units of cost in administrative issuances providing 
reporting guidance.
    (d) Use of wage records. Cooperating State agencies must, 
consistent with State law, use quarterly wage record information (as 
defined in 20 CFR 666.150(c)) in measuring the progress on program 
performance measures in paragraphs (c)(1)(i) through (c)(1)(iii) of 
this section. In order to meet this requirement, cooperating State 
agencies must use registered program participants' social security 
numbers or, if Federal law prohibits such use of social security 
numbers, other identifying designations, and such other information as 
is necessary, to measure the progress of those participants through 
quarterly wage record information. Cooperating State agencies that 
participate in the Wage Record Interchange System must use the Wage 
Record Interchange System to obtain pertinent wage information for 
individuals who obtain work outside the State in which they received 
services. Also, cooperating State agencies may use supplemental sources 
to obtain pertinent wage and employment data.
    (e) Reporting requirements. Cooperating State agencies must report 
TAA program performance data, identified in paragraphs (b) and (c) of 
this section, to the Department. The report used for this purpose is 
the Trade Act Participant Report (OMB control No. 1205-0392), unless 
otherwise superseded or on such other forms as the Department may 
prescribe. The report must be verified or validated as accurately 
counting and reporting activities in accordance with reporting 
instructions issued by the Department.
    (f) Performance evaluation and improvement. State performance 
outcomes will be measured against national goals established by the 
Department to evaluate State program performance and to plan actions to 
promote improved program performance. The Department may negotiate and 
establish individual performance goals each fiscal year with 
cooperating State agencies.
    (g) Publication of performance results. The Department will 
publish, annually, the TAA program performance results of the States.


Sec.  618.885  Termination of TAA program benefits.

    (a) Except as provided in paragraph (b) of this section, 
cooperating State agencies may not provide vouchers, allowances, and 
other payments or benefits under this part 618 after the termination 
date provided in section 285 of the Act or as otherwise provided by 
law.
    (b) Notwithstanding paragraph (a) of this section, cooperating 
State agencies must continue to provide benefits under this part 618 to 
an adversely affected worker for any week for which such worker meets 
the eligibility requirements for such benefits, if, on or before the 
termination date provided in section 285 of the Act or other law, the 
worker is--
    (1) A member of a worker group that is certified as eligible for 
benefits under this part 618; and
    (2) Is otherwise eligible to receive benefits under this part 618.

Subpart I--[Reserved]

PART 665--STATEWIDE WORKFORCE INVESTMENT ACTIVITIES UNDER TITLE I 
OF THE WORKFORCE INVESTMENT ACT

    6. The authority citation for part 665 continues to read as 
follows:

    Authority: Section 506(c), Public Law 105-220; 20 U.S.C. 
9276(c).

    7. Section 665.330 is revised to read as follows:


Sec.  665.330  Are Trade Adjustment Assistance (TAA) program 
requirements for rapid response assistance, under the Trade Act of 
1974, as amended, also required activities?

    (a) Yes. The Trade Act of 1974 (Pub. L. 93-618), as amended, 
requires that the Governor must make available rapid response 
assistance, described in Sec. Sec.  665.300 and 665.310, to individuals 
upon the filing of a petition covering those individuals.

[[Page 50832]]

    (b) If rapid response activities have been provided previously in 
response to a layoff or plant closure or other event, then the Governor 
must determine whether the provision of any additional information or 
assistance related to the TAA program is necessary due to the filing of 
the petition. This may include information about training 
opportunities, income support, employment services, and potential HCTC 
assistance.
    (c) If rapid response activities or assistance have not been 
provided previously in response to a layoff or plant closure or other 
event, then the Governor must ensure that appropriate rapid response 
assistance is provided. The Governor may develop and implement 
appropriate methods of achieving the goals of rapid response in 
situations where the full range of rapid response activities required 
by 20 CFR 665.310 is not appropriate. The alternative methods should be 
cost effective and responsive to the workers' needs. At a minimum, 
information and access to unemployment compensation benefits, 
comprehensive One-Stop system services, employment services, and TAA 
program benefits, must be provided.

PART 671--NATIONAL EMERGENCY GRANTS FOR DISLOCATED WORKERS

    8. The authority citation for part 671 continues to read as 
follows:


    Authority: Sec. 506(c), Public Law 105-220; 20 U.S.C. 9276(c).

    9. Section 671.105 is revised to read as follows:


Sec.  671.105  What funds are available for national emergency grants?

    (a) We use funds reserved under WIA section 132(a)(2)(A) to provide 
financial assistance to eligible applicants for grants under WIA 
section 173.
    (b) We use funds made available under WIA section 174 to make 
grants to provide health insurance coverage assistance under WIA 
section 173(f) and (g).
    10. Section Sec.  671.115 is added to read as follows:


Sec.  671.115  Under what circumstances are NEG grants available to 
provide assistance under WIA section 173(f) and (g)?

    (a) WIA section 173(f) authorizes NEGs to pay for health insurance 
coverage and administrative and start-up expenses related to the 
enrollment of TAA-eligible individuals and certain others, and their 
qualifying family members, in qualified health insurance.
    (b) WIA section 173(g) authorizes NEGs to pay for health insurance 
coverage for individuals eligible for health coverage tax credit. NEG 
funds under this section may also be used to provide other assistance 
and support services to eligible individuals, including transportation, 
childcare, dependent care and income assistance. For both health 
insurance coverage and income support assistance, the assistance cannot 
supplant other federal, state, or local assistance for which the 
individual is eligible.
    (c) In order to qualify for assistance funded under WIA section 
173(g), an individual must be:
    (1) ``An eligible TAA recipient,'' which is defined as an 
individual who is receiving a trade readjustment allowance (TRA) under 
the TAA program, or would be eligible for TRA except that he/she has 
not yet exhausted Unemployment Insurance benefits;
    (2) ``An eligible alternative TAA recipient,'' which is defined as 
an individual who is receiving benefits under a demonstration program 
of alternative trade adjustment assistance for older workers under 
subpart I of this part; or,
    (3) ``An eligible PBGC pension recipient,'' which is defined as an 
individual who is 55 years of age or older and is receiving a pension 
benefit paid in whole or part by the Pension Benefit Guaranty 
Corporation (PBGC).
    (d) A determination that an individual is an eligible TAA 
recipient, an eligible alternative TAA recipient, or an eligible PBGC 
pension recipient does not mean that individual is eligible for the 
health coverage tax credit; eligibility is determined by the Internal 
Revenue Service based upon whether other eligibility criteria are met.

[FR Doc. 06-7067 Filed 8-24-06; 8:45 am]
BILLING CODE 4510-30-P


</pre><script data-cfasync="false" src="/cdn-cgi/scripts/5c5dd728/cloudflare-static/email-decode.min.js"></script></body>
</html>