I

104TH CONGRESS

1ST SESSION H. R. 2332

To consolidate and reform workforce development and literacy programs,

and for other purposes.

IN THE HOUSE OF REPRESENTATIVES

SEPTEMBER 14, 1995

Mr. MCKEON introduced the following bill; which was referred to the

Committee on Economic and Educational Opportunities

A BILL

To consolidate and reform workforce development and

literacy programs, and for other purposes.

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled,

3 SECTION 1. SHORT TITLE.

4 This Act may be cited as the—

5 (1) ‘‘Consolidated and Reformed Education,

6 Employment, and Rehabilitation Systems Act’’; or

7 (2) ‘‘CAREERS Act’’.

8 SEC. 2. TABLE OF CONTENTS.

9 The table of contents for this Act is as follows:

Sec. 1. Short title.

Sec. 2. Table of contents.

Sec. 3. Purpose.
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Sec. 4. Authorization of appropriations.

Sec. 5. Definitions.

Sec. 6. Transition.

TITLE I—WORKFORCE DEVELOPMENT INFRASTRUCTURE

Sec. 101. Purpose of title.

Subtitle A—State and Local Responsibilities

Sec. 102. State requirements.

Sec. 103. Collaborative process regarding State system.

Sec. 104. Consolidated State workforce development and literacy plan.

Sec. 105. Establishment of workforce development areas.

Sec. 106. Provisions regarding local workforce development boards.

Sec. 107. Establishment of integrated career center systems.

Sec. 108. Identification of eligible Education, training, and vocational rehabilitation service providers.

Sec. 109. Management information systems.

Sec. 110. Performance accountability system.

Sec. 111. Limitation on Federal regulation.

Sec. 112. General provision.

Sec. 113. Liability.

Subtitle B—Amendments to Wagner-Peyser Act

Sec. 131. General program requirements.

Sec. 132. Labor market information.

Subtitle C—Worker Rights

Sec. 141. Requirements.

TITLE II—YOUTH DEVELOPMENT AND CAREER PREPARATION

CONSOLIDATION GRANT

Sec. 201. Purposes.

Sec. 202. Definitions.

Subtitle A—State Funding

Sec. 211. National and State funding.

Sec. 212. Within State allocation.

Subtitle B—State Organizational, Planning, and Reporting Responsibilities

Sec. 221. State plan.

Sec. 222. State programs and State activities.

Sec. 223. Incentive awards.

Sec. 224. Core standards, performance goals, and measures.

Subtitle C—Subgrants for In-School and At-Risk Youth

Sec. 231. Partnership agreements.

Sec. 232. Distribution of funds.

CHAPTER 1—IN-SCHOOL YOUTH

Sec. 241. Uses of funds for in-school youth.
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CHAPTER 2—AT-RISK YOUTH

Sec. 245. Uses of funds for at-risk youth.

Sec. 246. At-risk youth providers.

Subtitle D—National Programs

Sec. 251. Research activities.

Sec. 252. Assessment and data collection of youth development and career

preparation programs.

Sec. 253. National center or centers for research.

TITLE III—ADULT EMPLOYMENT AND TRAINING CONSOLIDATION

GRANT

Sec. 301. Purpose.

Subtitle A—Adult Employment and Training Consolidation Grant

Sec. 311. Authorization.

Sec. 312. Allotment among States.

Sec. 313. Allocation within States.

Sec. 314. Additional State plan requirements.

Sec. 315. Use of amounts.

Sec. 316. Core standards, performance goals, and measures.

Subtitle B—Federal Programs

Sec. 321. National discretionary grants.

Sec. 322. Disaster relief employment assistance.

Sec. 323. Research, demonstration, evaluation, and capacity building.

Sec. 324. Workforce skills and development loans.

Sec. 325. Employment, training, and education assistance for Native Americans.

Sec. 326. Employment, training, and education assistance for migrant and seasonal farmworkers.

TITLE IV—ADULT EDUCATION AND FAMILY LITERACY CONSOLIDATION GRANT AND LIBRARY SERVICES AND TECHNOLOGY

CONSOLIDATION GRANT

Sec. 401. Findings.

Sec. 402. Definitions.

Subtitle A—Adult Education and Family Literacy Consolidation Grant

Sec. 411. Purposes.

CHAPTER 1—FUNDING

Sec. 421. Reservations from amounts appropriated.

Sec. 422. Allotment.

CHAPTER 2—GRANTS TO STATES

Sec. 431. Requirement to make grants.

Sec. 432. Uses of funds.

Sec. 433. Additional grant requirements.

Sec. 434. Performance measures.
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CHAPTER 3—NATIONAL PROGRAMS

Sec. 441. National Institute for Literacy.

Sec. 442. National leadership activities.

Subtitle B—Library Services and Technology Consolidation Grant

Sec. 451. Purposes.

Sec. 452. Authorization of appropriations.

Sec. 453. Allotments.

Sec. 454. Grants to States.

Sec. 455. Uses of funds.

Sec. 456. Annual applications.

TITLE V—AMENDMENTS TO REHABILITATION ACT OF 1973

Subtitle A—Vocational Rehabilitation Consolidation Grant

CHAPTER 1—TRANSITION PERIOD

Sec. 501. Transition.

CHAPTER 2—REVISION OF TITLE I OF REHABILITATION ACT OF 1973

Sec. 511. Revision of title I.

Subtitle B—Other Amendments to Rehabilitation Act of 1973

Sec. 521. Training and demonstration projects.

Sec. 522. Employment opportunities for individuals with disabilities.

Sec. 523. Certain amounts.

TITLE VI—HIGHER EDUCATION PRIVATIZATION

Sec. 601. Reorganization of the Student Loan Marketing Association through

the formation of a holding company.

Sec. 602. Privatization of College Construction Loan Insurance Association.

TITLE VII—REPEALERS AND OTHER AMENDMENTS

Sec. 701. Higher education provisions.

Sec. 702. Amendment to Higher Education Act.

Sec. 703. Carl D. Perkins Vocational and Applied Technology Education Act.

Sec. 704. Smith-Hughes Act.

Sec. 705. School-to-Work Opportunities Act of 1994.

Sec. 706. School Dropout Assistance Act.

Sec. 707. Adult Education Act.

Sec. 708. National Literacy Act.

Sec. 709. Library Services and Construction Act.

Sec. 710. Technology for Education Act of 1994.

Sec. 711. Job Training Partnership Act.

Sec. 712. Stewart B. Mckinney Homeless Assistance Act.

Sec. 713. Effective date.
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1 SEC. 3. PURPOSE.

2 The purpose of this Act is to transform the vast array

3 of Federal workforce development and literacy programs

4 from a collection of fragmented and duplicative categorical

5 programs into a streamlined, comprehensive, coherent,

6 high-quality, cost-effective, market-based, and accountable

7 workforce development and literacy system that is de8 signed to meet the education, economic, employment, and

9 training needs of the workforce and the competitiveness

10 needs of employers of the United States, both today and

11 in the future.

12 SEC. 4. AUTHORIZATION OF APPROPRIATIONS.

13 (a) IN GENERAL.—There are authorized to be appro14 priated—

15 (1) for title II, $2,324,600,000 for fiscal year

16 1997 and such sums as may be necessary for each

17 of the fiscal years 1998 through 2002 to carry out

18 the programs under such title;

19 (2) for title III, $2,183,000,000 for fiscal year

20 1997 and such sums as may be necessary for each

21 of the fiscal years 1998 through 2002 to carry out

22 the programs under such title; and

23 (3) for subtitle A of title IV, $280,000,000 for

24 fiscal year 1997 and such sums as may be necessary

25 for each of the fiscal years 1998 through 2002 to

26 carry out the programs under such subtitle.
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1 (b) PROGRAM YEAR.—

2 (1) IN GENERAL.—Beginning in fiscal year

3 1997, and each year thereafter, appropriations for

4 any fiscal year for programs and activities under ti5 tles II, III, and IV of this Act shall be available for

6 obligation only on the basis of a program year. The

7 program year shall begin on July 1 in the fiscal year

8 for which the appropriation is made.

9 (2) OBLIGATION.—Funds obligated for any pro10 gram year under titles II, III, and IV, may be ex11 pended by each recipient during that program year

12 and the two succeeding program years, except that

13 the Secretary shall, in accordance with paragraph

14 (3), reallot to eligible States the funds allotted to

15 States from funds appropriated for reallotments.

16 (3) AMOUNTS AVAILABLE FOR REALLOT17 MENT.—The amount available for reallotment is

18 equal to—

19 (A) the amount by which the unobligated

20 balance of the State allotment at the end of the

21 program year prior to the program year for

22 which the determination under this section is

23 made exceeds 20 percent of such allotment for

24 the prior program year; plus
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1 (B) the unexpended balance of the State

2 allotment from any program year prior to the

3 program year in which there is such excess.

4 SEC. 5. DEFINITIONS.

5 For purposes of this Act, except as otherwise pro6 vided:

7 (1) ADULT.—The term ‘‘adult’’ means an indi8 vidual who is 16 years of age, or beyond the age of

9 compulsory school attendance under State law

10 (whichever age is higher), and who is not enrolled or

11 required to be enrolled in secondary school.

12 (2) ADULT EDUCATION.—The term ‘‘adult edu13 cation’’ means services or instruction below the post14 secondary level for adults—

15 (A) who are not enrolled in secondary

16 school;

17 (B) who lack sufficient mastery of basic

18 educational skills to enable them to function ef19 fectively in society or who do not have a certifi20 cate of graduation from a school providing sec21 ondary education and who have not achieved an

22 equivalent level of education;

23 (C) who are not currently required to be

24 enrolled in school; and
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1 (D) whose lack of mastery of basic skills

2 results in an inability to speak, read, or write

3 the English language which constitutes a sub4 stantial impairment of their ability to get or re5 tain employment commensurate with their real

6 ability, and thus are in need of programs to

7 help eliminate such inability and raise the level

8 of education of such individuals with a view to

9 making them less likely to become dependent on

10 others.

11 (3) AREA VOCATIONAL EDUCATION SCHOOL.—

12 The term ‘‘area vocational education school’’

13 means—

14 (A) a specialized high school used exclu15 sively or principally for the provision of voca16 tional education to individuals who are available

17 for study in preparation for entering the labor

18 market;

19 (B) the department of a high school exclu20 sively or principally used for providing voca21 tional education in not less than 5 different oc22 cupational fields to individuals who are avail23 able for study in preparation for entering the

24 labor market;
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1 (C) a technical institute or vocational

2 school used exclusively or principally for the

3 provision of vocational education to individuals

4 who have completed or left high school and who

5 are available for study in preparation for enter6 ing the labor market; or

7 (D) the department or division of a junior

8 college, community college or university operat9 ing under the policies of the State board and

10 which provides vocational education in not less

11 than 5 different occupational fields leading to

12 immediate employment but not necessarily lead13 ing to a baccalaureate degree, if, in the case of

14 a school, department, or division described in

15 subparagraph (C) or this subparagraph, it ad16 mits as regular students both individuals who

17 have completed high school and individuals who

18 have left high school.

19 (4) AT-RISK YOUTH.—The term ‘‘at-risk youth’’

20 means—

21 (A) an out-of-school, at-risk youth who is

22 an individual age 24 or younger and who is not

23 enrolled in a secondary or postsecondary edu24 cation program, has not received a high school

25 diploma or its equivalent and must overcome
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1 barriers to employment such as lack of suffi2 cient education or vocational skills, economic

3 disadvantages, disability, or limited English

4 proficiency; or

5 (B) an in-school, at-risk youth who is an

6 individual age 24 or younger who is enrolled in

7 an accredited secondary or postsecondary edu8 cation program but is at risk of dropping out

9 of school or must overcome barriers to complete

10 an education program, such as economic dis11 advantages, disability, or limited English pro12 ficiency.

13 (5) COMPREHENSIVE CAREER GUIDANCE AND

14 COUNSELING.—The term ‘‘comprehensive career

15 guidance and counseling’’ means a program—

16 (A) which pertains to the body of subject

17 matter and related techniques and methods or18 ganized for the development in individuals of

19 career awareness, career planning, career deci20 sionmaking, placement skills, and knowledge

21 and understanding of local, State, and national

22 occupational, educational, and labor market

23 needs, trends, and opportunities;
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1 (B) which assists such individuals in mak2 ing and implementing informed educational and

3 occupational choices; and

4 (C) which is comprehensive in nature.

5 (6) CAREER GRANT.—The term ‘‘career grant’’

6 means a voucher or a credit issued to a participant

7 under title III of this Act, or title I of the Rehabili8 tation Act of 1973, for the purchase of education or

9 training services from certified providers of such

10 services, in accordance with the provisions of this

11 Act, and with guidelines issued by the State.

12 (7) CASE MANAGEMENT.—The term ‘‘case man13 agement’’ means the provision of a client-centered

14 approach in the delivery of services designed to—

15 (A) empower individuals to make informed

16 career choices;

17 (B) prepare and coordinate comprehensive

18 employment plans, based upon such individual

19 choices, such as service strategies for partici20 pants, to ensure access to necessary training

21 and supportive services, using, where feasible,

22 computer-based technologies; and

23 (C) provide job and career counseling dur24 ing program participation and after job place25 ment.
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1 (8) CHIEF ELECTED OFFICIAL.—The term

2 ‘‘chief elected official’’ means the chief elected execu3 tive officer of a unit of general local government in

4 a workforce development area.

5 (9) COMMUNITY-BASED ORGANIZATION.—The

6 term ‘‘community-based organization’’ means a pri7 vate nonprofit organization that is representative of

8 a community or significant segments of a community

9 that provides or facilitates education, vocational re10 habilitation, job training, supportive services, or in11 ternship services and programs.

12 (10) DEMOGRAPHIC CHARACTERISTICS.—The

13 term ‘‘demographic characteristics’’ means informa14 tion on population, especially with reference to size,

15 density, distribution, and vital statistics including,

16 age, race, sex, ethnic origin, and income status.

17 (11) DISLOCATED WORKER.—The term ‘‘dis18 located worker’’ means an individual who—

19 (A) has been terminated or laid off or who

20 has received a notice of termination or layoff

21 from employment, is eligible for or has ex22 hausted entitlement to unemployment com23 pensation, and is unlikely to return to a pre24 vious industry or occupation;
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1 (B) has been terminated, or has received a

2 notice of termination of employment, as a result

3 of any permanent closure of, or any substantial

4 layoff at, a plant, facility, or enterprise;

5 (C) has been unemployed long-term and

6 has limited opportunities for employment or re7 employment in the same or a similar occupation

8 in the area in which such individual resides, in9 cluding an older individual who may have sub10 stantial barriers to employment by reason of

11 age; or

12 (D) was self-employed (including farmers

13 and ranchers) but is unemployed as a result of

14 general economic conditions in the community

15 in which they reside or because of natural dis16 asters.

17 (12) DISPLACED HOMEMAKER.—The term ‘‘dis18 placed homemaker’’ means an individual who—

19 (A) is an adult; and

20 (B)(i) has worked as an adult primarily

21 without remuneration to care for the home and

22 family, and for that reason has diminished mar23 ketable skills;
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1 (ii) has been dependent on public assist2 ance or on the income of a relative but is no

3 longer supported by such income; or

4 (iii) is a parent whose youngest dependent

5 child will become ineligible to receive assistance

6 under the program for aid to families with de7 pendent children under part A of title IV of the

8 Social Security Act within 2 years of the par9 ent’s application for assistance under title II of

10 this Act.

11 (13) EARNINGS.—The term ‘‘earnings’’ means

12 gross hourly wages before any deduction, plus the

13 estimated hourly value of bonuses, tips, gratuities,

14 commissions, and overtime pay either expected or re15 ceived. In the case of individuals in subsidized em16 ployment, total hourly earnings include any wage

17 subsidy paid to the individual.

18 (14) ECONOMIC DEVELOPMENT AGENCIES.—

19 The term ‘‘economic development agencies’’ means

20 State and local planning and zoning commissions or

21 boards, community development agencies, and other

22 State and local agencies and institutions responsible

23 for regulating, promoting, or assisting in State and

24 local economic development.
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1 (15) ECONOMICALLY DISADVANTAGED.—The

2 term ‘‘economically disadvantaged’’ means an indi3 vidual who—

4 (A) receives, or is a member of a family

5 which receives, cash welfare payments under a

6 Federal, State, or local welfare program;

7 (B) has, or is a member of a family which

8 has, received a total family income for the 6-

9 month period prior to application for the pro10 gram involved (exclusive of unemployment com11 pensation, child support payments, and welfare

12 payments) which, in relation to family size, was

13 not in excess of the higher of—

14 (i) the official poverty line (as defined

15 by the Office of Management and Budget,

16 and revised annually in accordance with

17 section 673(2) of the Omnibus Budget

18 Reconciliation Act of 1981 (42 U.S.C.

19 9902(2)), or

20 (ii) 70 percent of the lower living

21 standard income level;

22 (C) is receiving (or has been determined

23 within the 6-month period prior to the applica24 tion for the program involved to be eligible to
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1 receive) food stamps pursuant to the Food

2 Stamp Act of 1977;

3 (D) qualifies as a homeless individual

4 under subsections (a) and (c) of section 103 of

5 the Stewart B. McKinney Homeless Assistance

6 Act;

7 (E) is a foster child on behalf of whom

8 State or local government payments are made;

9 (F) in cases permitted by regulations of

10 the Secretary, is an individual with a disability

11 whose own income meets the requirements of

12 subparagraph (A) or (B), but who is a member

13 of a family whose income does not meet such

14 requirements; or

15 (G) is an individual meeting appropriate

16 criteria approved by a State.

17 (16) EDUCATIONAL SERVICE AGENCY.—The

18 term ‘‘educational service agency’’ means a regional

19 public multiservice agency authorized by State stat20 ute to develop, manage, and provide services or pro21 grams to local educational agencies, and is recog22 nized as an administrative agency for such State’s

23 vocational or technical education schools or for voca24 tional programs within its public elementary or sec25 ondary schools. Such term includes any other public
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1 institution or agency having administrative control

2 and direction over a public elementary or secondary

3 school.

4 (17) EMPLOYED.—The term ‘‘employed’’ means

5 an individual who is currently—

6 (A) a paid employee;

7 (B) works in his or her own business, pro8 fession, or farm;

9 (C) works 15 hours or more per week as

10 an unpaid worker in an enterprise operated by

11 a family member or is one who is not working,

12 but has a job or business from which he or she

13 is temporarily absent due to illness, bad weath14 er, vacation, labor-management dispute, or per15 sonal reasons; or

16 (D) on active military duty.

17 (18) ENGLISH LITERACY PROGRAM.—The term

18 ‘‘English literacy program’’ means a program of in19 struction designed to help limited English proficient

20 adults, out-of-school youths, or both, achieve full

21 competence in the English language.

22 (19) EXCESS NUMBER.—The term ‘‘excess

23 number’’ means, with respect to the excess number

24 of unemployed individuals within a State, the num25 ber that represents the number of unemployed indi-
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1 viduals in excess of 4.5 percent of the civilian labor

2 force in the State, or the number that represents the

3 number of unemployed individuals in excess of 4.5

4 percent of the civilian labor force in areas of sub5 stantial unemployment in such State.

6 (20) FAMILY AND CONSUMER SCIENCES.—The

7 term ‘‘family and consumer sciences’’ means instruc8 tional programs, services, and activities which pre9 pare students for personal, family, community, and

10 career roles.

11 (21) GOVERNOR.—The term ‘‘Governor’’ means

12 the chief executive of a State.

13 (22) INDIVIDUAL OF LIMITED ENGLISH PRO14 FICIENCY.—The term ‘‘individual of limited English

15 proficiency’’ means an adult or out-of-school youth

16 who has limited ability in speaking, reading, writing,

17 or understanding the English language and—

18 (A) whose native language is a language

19 other than English; or

20 (B) who lives in a family or community en21 vironment where a language other than English

22 is the dominant language.

23 (23) INDIVIDUALS WITH DISABILITIES.—The

24 term ‘‘individuals with disabilities’’ has the meaning

25 given such term in the Rehabilitation Act of 1973.
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1 (24) INSTITUTION OF HIGHER EDUCATION.—

2 The term ‘‘institution of higher education’’ has the

3 meaning given such term in section 481 of the High4 er Education Act of 1965.

5 (25) JOB SEARCH ASSISTANCE.—The term ‘‘job

6 search assistance’’ means a service that helps a job7 ready individual seek, locate, apply for, and obtain

8 employment. Such services may include, job-finding

9 skills, orientation to the labor market, resume prepa10 ration assistance, job finding clubs, job search work11 shops, vocational exploration, and other employ12 ability services.

13 (26) LABOR MARKET AREA.—The term ‘‘labor

14 market area’’ means an economically integrated geo15 graphic area within which individuals can reside and

16 find employment within a reasonable distance or can

17 readily change employment without changing their

18 place of residence. Such areas shall be identified in

19 accordance with criteria used by the Bureau of

20 Labor Statistics of the Department of Labor in de21 fining such areas or similar criteria established by a

22 Governor.

23 (27) LIBRARY.—The term ‘‘library’’ includes—

24 (A) a public library;
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1 (B) a public elementary or secondary

2 school library;

3 (C) an academic library;

4 (D) a research library; and

5 (E) a private library, but only if the State

6 in which such private library is located deter7 mines that the library should be considered a li8 brary for purposes of this Act.

9 (28) LITERACY.—The term ‘‘literacy’’ means an

10 individual’s ability to read, write, and speak in Eng11 lish, and compute and solve problems, at levels of

12 proficiency necessary—

13 (A) to function on the job, in the individ14 ual’s family and in society;

15 (B) to achieve the individual’s goals; and

16 (C) to develop the individual’s knowledge

17 potential.

18 (29) LOCAL EDUCATIONAL AGENCY.—The term

19 ‘‘local educational agency’’ has the same meaning

20 given such term in section 14101 of the Elementary

21 and Secondary Education Act of 1965.

22 (30) MIGRANT FARMWORKER.—The term ‘‘mi23 grant farmworker’’ means a seasonal farmworker

24 whose farm work requires travel such that the work-
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1 er is unable to return to a permanent place of resi2 dence within the same day.

3 (31) NATIVE AMERICAN.—The term ‘‘native

4 American’’ means Indians, Alaskan natives, and Ha5 waiian natives.

6 (32) NONTRADITIONAL EMPLOYMENT.—The

7 term ‘‘nontraditional employment’’ as applied to

8 women refers to occupations or fields of work where

9 women comprise less than 25 percent of the individ10 uals employed in such occupation or field of work.

11 (33) ON-THE-JOB TRAINING.—The term ‘‘on12 the-job training’’ means training in the public or pri13 vate sector that is provided to a paid employee while

14 engaged in productive work that—

15 (A) provides knowledge or skills essential

16 to the full and adequate performance of the job;

17 (B) provides reimbursement to employers,

18 up to 50 percent of the participant’s wage rate,

19 for the extraordinary costs of providing training

20 and additional supervision; and

21 (C) is based on the Occupational Employ22 ment Statistics Program Dictionary.

23 (34) POSTSECONDARY EDUCATIONAL INSTITU24 TION.—The term ‘‘postsecondary educational institu25 tion’’ means an institution of higher education (as
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1 such term is defined in section 481 of the Higher

2 Education Act of 1965) which continues to meet the

3 eligibility and certification requirements under title

4 IV of such Act (20 U.S.C. 1070 et seq.).

5 (35) PREEMPLOYMENT SKILLS TRAINING; JOB

6 READINESS SKILLS TRAINING.—The terms

7 ‘‘preemployment skills training’’ and ‘‘job readiness

8 skills training’’ mean training that builds on family

9 efforts to help prepare individuals for work by assur10 ing that they are familiar with general workplace ex11 pectations and exhibit work behavior and attitudes

12 necessary to compete successfully in the job market.

13 (36) PUBLIC ASSISTANCE.—The term ‘‘public

14 assistance’’ means Federal, State, or local govern15 ment cash payments for which eligibility is deter16 mined by a needs or income test.

17 (37) RAPID RESPONSE.—The term ‘‘rapid re18 sponse’’ means assistance that is directly provided

19 by the State, or by local grantees with funds pro20 vided by the State, in the case of mass layoffs or

21 plant closures, and that establishes on-site contact

22 with employer and employee representatives within a

23 short period of time (preferably 48 hours or less)

24 after becoming aware of a current or projected per25 manent closure or substantial layoff in order to—
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1 (A) provide information on, and facilitate

2 access to, available public programs and serv3 ices for workers losing jobs as a result of such

4 layoff or closure;

5 (B) provide emergency assistance adapted

6 to the particular closure or layoff;

7 (C) promote the formation of labor-man8 agement committees, where appropriate;

9 (D) collect information related to economic

10 dislocation and available resources within the

11 State for dislocated workers;

12 (E) provide or obtain appropriate financial

13 and technical advice and liaison with economic

14 development agencies and other organizations

15 to assist in efforts to avert worker dislocation;

16 and

17 (F) assist the local community in develop18 ing its own coordinated response and in obtain19 ing access to State economic development as20 sistance.

21 (38) REGISTERED APPRENTICESHIP.—The term

22 ‘‘registered apprenticeship’’ means a program reg23 istered by the Bureau of Apprenticeship and Train24 ing in the United States Department of Labor, or a

25 State Apprenticeship Agency recognized and ap-
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1 proved by the Bureau of Apprenticeship and Train2 ing as the appropriate body for State registration or

3 approval of local apprenticeship programs and agree4 ments.

5 (39) SCHOOL DROPOUT.—The term ‘‘school

6 dropout’’ means a youth who is no longer attending

7 any school and who has not received a secondary

8 school diploma or a certificate from a program of

9 equivalency for such a diploma.

10 (40) SEASONAL FARMWORKER.—The term

11 ‘‘seasonal farmworker’’ means a person who during

12 the eligibility determination period (12 consecutive

13 months out of 24 months prior to application) has

14 been primarily employed in farm work that is char15 acterized by chronic unemployment or under employ16 ment.

17 (41) SKILL CERTIFICATE.—The term ‘‘skill cer18 tificate’’ means a portable, industry-recognized cre19 dential achieved through programs authorized under

20 this Act, that certifies that an individual has mas21 tered occupational skills at levels that are at least as

22 challenging as skill standards endorsed by the Na23 tional Skill Standards Board, except that until such

24 skill standards are developed, the term ‘‘skill certifi25 cate’’ means a credential issued under a process en-
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1 dorsed by the State, based upon established industry

2 standards and benchmarks.

3 (42) STATE.—The term ‘‘State’’ means any of

4 the several States, the District of Columbia, the

5 Commonwealth of Puerto Rico, the Virgin Islands,

6 American Samoa, Guam, and the Commonwealth of

7 the Northern Mariana Islands.

8 (43) STATE EDUCATIONAL AGENCY.—The term

9 ‘‘State educational agency’’ has the meaning given

10 such term in section 14101 of the Elementary and

11 Secondary Education Act of 1965.

12 (44) STATE LIBRARY ADMINISTRATIVE AGEN13 CY.—The term ‘‘State library administrative agen14 cy’’ means the official agency of a State charged by

15 the law of the State with the extension and develop16 ment of public library services throughout the State.

17 (45) SUPPORTIVE SERVICES.—The term ‘‘sup18 portive services’’ means services which are necessary

19 to enable an individual eligible for training under

20 this Act, but who cannot afford to pay for such serv21 ices, to participate in a training or vocational reha22 bilitation program or job search activities funded

23 under this Act. Such supportive services may include

24 transportation, individual and family counseling,

25 child care and dependent care, meals, temporary
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1 shelter, financial counseling, needs-based payments,

2 and other reasonable expenses required for partici3 pation in a training, job preparation, or job place4 ment program. Such services may be provided in5 kind or through cash assistance, except that such

6 services will be provided with funds provided under

7 this Act only after alternative funding sources spe8 cifically designated for such services have been ex9 hausted.

10 (46) UNEMPLOYED.—The term ‘‘unemployed’’

11 refers to an individual who is not employed, who is

12 available for work, and who has made specific efforts

13 to find a job within the prior 4 weeks. Included as

14 unemployed are individuals who are not working, are

15 available for work, and are waiting to be called back

16 to a job from which they have been laid off.

17 (47) UNIT OF GENERAL LOCAL GOVERN18 MENT.—The term ‘‘unit of general local govern19 ment’’ means any general purpose political subdivi20 sion of a State which has the power to levy taxes

21 and spend funds, as well as general corporate and

22 police powers.

23 (48) VETERAN.—The term ‘‘veteran’’ has the

24 meaning given such term in section 101(2) of title

25 38, United States Code.
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1 (49) WORK EXPERIENCE.—The term ‘‘work ex2 perience’’ means a time-limited work activity that

3 provides an individual with the opportunity to ac4 quire the general skills and knowledge necessary to

5 obtain employment.

6 (50) WORKPLACE MENTOR.—The term ‘‘work7 place mentor’’ means an employee or other individ8 ual, approved by the employer at a workplace, who

9 possesses the skills and knowledge to be mastered by

10 a student or program participant, and who instructs,

11 critiques the performance, and challenges the stu12 dent or program participant to perform well, and

13 works in consultation with classroom teachers, train14 ing providers, parents, and the employer of the stu15 dent or program participant.

16 (51) YOUTH.—The term ‘‘youth’’ means an in17 dividual under the age of 24.

18 SEC. 6. TRANSITION.

19 The Secretary of Education and the Secretary of

20 Labor shall take such steps as they determine to be appro21 priate to provide for the orderly transition from any au22 thority under provisions of statutes amended or repealed

23 by this Act or any related authority under provisions of

24 this Act.
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1 TITLE I—WORKFORCE DEVELOP2 MENT INFRASTRUCTURE

3 SEC. 101. PURPOSE OF TITLE.

4 The purpose of this title is to provide for the estab5 lishment of an infrastructure within States on which to

6 build a comprehensive system of workforce development

7 and literacy.

8 Subtitle A—State and Local

9 Responsibilities

10 SEC. 102. STATE REQUIREMENTS.

11 (a) IN GENERAL.—For fiscal year 1997 and subse12 quent fiscal years, a State that desires to receive a grant

13 under one or more of the programs specified in subsection

14 (b) shall—

15 (1) establish a collaborative process, pursuant

16 to section 103;

17 (2) develop a State workforce development and

18 literacy plan, pursuant to section 104; and

19 (3) otherwise comply with the requirements of

20 this Act.

21 (b) WORKFORCE DEVELOPMENT AND LITERACY

22 PROGRAMS.—

23 (1) IN GENERAL.—The programs referred to in

24 subsection (a) are the following:
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1 (A) The program under title II, the Youth

2 Development and Career Preparation Consoli3 dation Grant.

4 (B) The program under title III, the Adult

5 Employment and Training Consolidation Grant.

6 (C) The program under subtitle A of title

7 IV, the Adult Education and Family Literacy

8 Consolidation Grant.

9 (D) The program amended by subtitle A of

10 title V (relating to title I of the Rehabilitation

11 Act of 1973).

12 (2) DEFINITION.—For purposes of this Act, the

13 term ‘‘Workforce Development and Literacy pro14 grams’’ means the programs specified in paragraph

15 (1).

16 SEC. 103. COLLABORATIVE PROCESS REGARDING STATE

17 SYSTEM.

18 (a) IN GENERAL.—The Governor of a State that de19 sires to receive a grant under one or more of the programs

20 specified in section 102(b) shall certify to the Secretary

21 of Education and the Secretary of Labor that a collabo22 rative process, as described in subsection (b) or (c), has

23 been used in complying with the applicable provisions of

24 this Act.
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1 (b) COLLABORATIVE PROCESS.—The collaborative

2 process referred to in subsection (a) is a process for mak3 ing decisions which includes as participants, at a mini4 mum, the Governor and—

5 (1) representatives of (which representatives are

6 appointed by the Governor)—

7 (A) business and industry;

8 (B) local chief elected officials (represent9 ing both cities and counties);

10 (C) local educational agencies (including

11 vocational educators);

12 (D) postsecondary institutions (including

13 community and technical colleges);

14 (E) the State rehabilitation advisory coun15 cil;

16 (F) organizations representing individuals

17 served by programs established under this Act

18 (including community-based organizations);

19 (G) employees;

20 (H) parents or organizations representing

21 parents; and

22 (I) providers of workforce development

23 services (including private-for-profit sector pro24 viders); and
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1 (2) the lead State agency official or officials

2 for—

3 (A) the State educational agency or agen4 cies (including the lead official or officials for

5 vocational education, adult education and lit6 eracy, and libraries);

7 (B) the State agency responsible for eco8 nomic development;

9 (C) the State agency or agencies respon10 sible for employment security and for job train11 ing;

12 (D) the State agency responsible for post13 secondary education;

14 (E) the State agency responsible for voca15 tional rehabilitation, and where applicable, the

16 State agency providing vocational rehabilitation

17 services for the blind;

18 (F) the State agency responsible for ad19 ministering welfare benefits; and

20 (G) the representative of the Veterans’

21 Service assigned to the State under section

22 4103 of title 38, United States Code.

23 (c) RULE OF CONSTRUCTION.—With respect to com24 pliance with subsection (b)—
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1 (1) a State may use any existing State process

2 (including any council or similar entity) that sub3 stantially meets the purposes of such subsection; or

4 (2) if prior to the date of enactment of this Act,

5 a State has developed a one-stop career center sys6 tem or a school-to-work system through a collabo7 rative process substantially similar to the process de8 scribed in subsection (b), the State may use such

9 process.

10 (d) AUTHORITY OF GOVERNOR.—

11 (1) FINAL AUTHORITY.—If, after a reasonable

12 effort, a Governor is unable to obtain agreement

13 through the collaborative process described in sub14 section (b) or (c), the Governor shall have final au15 thority to make decisions and to submit the State

16 plan as described under section 104.

17 (2) EXCEPTION.—Nothing in this Act shall be

18 construed to negate or supersede the legal authority,

19 under State law of any State agency, State entity,

20 or State public official over programs that are under

21 the jurisdiction of the agency, entity, or official.

22 Nothing in this Act shall be construed to interfere

23 with the authority of such agency, entity, or official

24 to enter into a contract under any provision of law.
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1 SEC. 104. CONSOLIDATED STATE WORKFORCE DEVELOP2 MENT AND LITERACY PLAN.

3 (a) IN GENERAL.—The Governor of a State that de4 sires to receive a grant under one or more of the programs

5 specified in section 102(b) shall submit a strategic State

6 workforce development and literacy plan that provides pol7 icy guidance with respect to workforce development pro8 grams operated in the State, and that meets the require9 ments of this section to the Secretary of Education and

10 the Secretary of Labor.

11 (b) CONTENTS.—A State workforce development and

12 literacy plan shall include the following:

13 (1) A description of the collaborative process

14 under section 103 used in developing the plan.

15 (2) A statement of the goals of the State

16 workforce development and literacy system, that in17 cludes—

18 (A) a description of how the State will

19 progress toward achieving the goals and pur20 pose of this Act as established in sections

21 3(a)(5) and 3(b);

22 (B) an assessment of the needs of the

23 State with regard to current and projected de24 mands for workers by occupation, the skills and

25 education levels of the workforce, the vocational

26 rehabilitation needs of individuals with severe
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1 disabilities residing in the State, the skill and

2 economic development needs of the State, and

3 an assessment of the type and availability of

4 youth development and career preparation,

5 workforce development, adult education, voca6 tional rehabilitation, and literacy programs and

7 services in the State; and

8 (C) the identification of progress indica9 tors, based on the core indicators of perform10 ance described in section 110(f), built upon a

11 model of continuous improvement, that the

12 State will use to measure progress made by the

13 State, local workforce development boards, and

14 other applicable local entities who are recipients

15 of financial assistance under this Act in meet16 ing such goals;

17 (3) A description of how the State has com18 plied, or will comply, with the provisions of sections

19 105 through 108.

20 (4) A description of how a State will participate

21 in the national labor market information system

22 under title II of the Wagner-Peyser Act, as added by

23 section 132 of this Act.

24 (5) Any information required to be included in

25 the plan under any of titles II through IV, and title
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1 I of the Rehabilitation Act of 1973 (in the case of

2 a State that desires to receive a grant under any

3 such title).

4 (6) A description of the measures that will be

5 taken by the State to ensure coordination and con6 sistency and avoid duplication among programs re7 ceiving assistance under this Act, including a de8 scription of common data collection and reporting

9 processes.

10 (7) A description of the process used by the

11 State to provide an opportunity for public comment,

12 and input into the development of the plan, prior to

13 submission of the plan.

14 (8) A description of the process used by the

15 State to consult with representatives of business and

16 industry with respect to the requirements of sub17 paragraphs (A), (B), and (C) of paragraph (2) of

18 this subsection.

19 (9) Assurances that the State will provide for

20 fiscal control and fund accounting procedures that

21 may be necessary to ensure the proper disbursement

22 of, and accounting for, funds paid to the State

23 under this Act.

24 (10) A description of the sanctions which the

25 State may impose (including restrictions from future
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1 participation or consideration for funding) in in2 stances where recipients of funds under this Act fail

3 to achieve agreed upon expected performance levels,

4 fail to adhere to State mandated fiscal control and

5 funds accounting procedures, or take or fail to take

6 other actions required under the State plan, con7 tracts, or other agreements.

8 (c) DISAGREEMENT.—The Governor shall accept and

9 include with the plan submitted under subsection (a) any

10 disagreeing views submitted by a participant of the col11 laborative process if such views represent disagreement in

12 the area in which such participant was selected for rep13 resentation.

14 (d) MODIFICATIONS TO PLAN.—A plan submitted by

15 a State in accordance with this section remains in effect

16 until the State submits to the Secretary such modifica17 tions as the State determines necessary. This section ap18 plies to the modifications to the same extent and in the

19 same manner as this section applies to the original plan.

20 SEC. 105. ESTABLISHMENT OF WORKFORCE DEVELOPMENT

21 AREAS.

22 The Governor of a State that desires to receive a

23 grant under one or more of the programs specified in sec24 tion 102(b) shall, through the collaborative process estab25 lished under section 103 and after consultation with local
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1 chief elected officials, and after consideration of comments

2 received through the public participation process as de3 scribed in the State plan, designate local workforce devel4 opment areas within the State taking into consideration

5 the following:

6 (1) Existing labor market areas.

7 (2) Units of general local government.

8 (3) Geographic areas served by local edu9 cational agencies and intermediate educational agen10 cies.

11 (4) Geographic areas served by postsecondary

12 institutions and area vocational education schools.

13 (5) Service delivery areas established under sec14 tion 101 of the Job Training Partnership Act (29

15 U.S.C. 1511) (as such Act was in effect on the day

16 before the date of the enactment of this Act).

17 (6) The distance that individuals will need to

18 travel to receive services from integrated career cen19 ters.

20 SEC. 106. PROVISIONS REGARDING LOCAL WORKFORCE DE21 VELOPMENT BOARDS.

22 (a) IN GENERAL.—The Governor of a State that de23 sires to receive a grant under one or more of the programs

24 specified in section 102(b) shall ensure the establishment
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1 of a local workforce development board in each local

2 workforce development area within the State.

3 (b) STATE CRITERIA.—The Governor, through the

4 collaborative process described under section 103, is au5 thorized to establish criteria for use by local chief elected

6 officials in the workforce development area, in the selec7 tion of members of local workforce development boards,

8 in accordance with requirements prescribed under sub9 sections (c) and (d).

10 (c) REPRESENTATION REQUIREMENT.—Such criteria

11 shall require, at a minimum, that a local workforce devel12 opment board consist of—

13 (1) a majority of members who are representa14 tives of business and industry, including individuals

15 who are owners of businesses, chief executives or

16 chief operating officers of private business, and

17 other business executives with optimum policy18 making authority in local businesses, selected from

19 among nominees submitted by local business organi20 zations and trade associations;

21 (2) an individual or individuals with disabilities,

22 who have special knowledge or expertise in the area

23 of vocational rehabilitation;

24 (3) representatives of education and training,

25 including local educational agencies, postsecondary
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1 education institutions, and providers of job training

2 and workforce development services, selected from

3 among individuals nominated by regional or local

4 educational agencies, vocational education institu5 tions, institutions of postsecondary education (in6 cluding community colleges), providers of job train7 ing and workforce development services (including

8 private-for-profit providers), within the workforce

9 development area; and

10 (4) representatives of community-based organi11 zations, employees, and veterans as nominated or

12 recommended to the board through a process estab13 lished by the Governors through the collaborative

14 process.

15 (d) ESTABLISHMENT OF BOARD.—

16 (1) SELECTION OF BOARD MEMBERS.—

17 (A) SINGLE UNIT OF LOCAL GOVERNMENT

18 IN AREA.—In the case of a workforce develop19 ment area that is comprised of only one unit of

20 general local government, the chief elected offi21 cial of such unit is authorized to select the

22 members of the local workforce development

23 board for such area, in accordance with the

24 State criteria developed pursuant to subsection

25 (b).
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1 (B) MULTIPLE UNITS IN AREA.—In the

2 case of a workforce development area that is

3 comprised of more than one unit of general

4 local government, the chief elected officials of

5 such units are authorized to select the members

6 of the local workforce development board from

7 the individuals so nominated or recommended

8 for such area in accordance with an agreement

9 entered into by such officials and with the State

10 criteria developed under subsection (b). In the

11 absence of such an agreement, the appoint12 ments are authorized to be made by the Gov13 ernor, through the collaborative process, from

14 the individuals so nominated or recommended.

15 (2) CERTIFICATION.—The Governor is author16 ized to biennially certify one local workforce develop17 ment board for each workforce development area.

18 (3) EXCEPTION.—In any case in which a local

19 workforce development area is a State, the individ20 uals comprising the Governor’s collaborative process

21 as described in section 103, may be reconstituted to

22 meet the requirements of this section.

23 (e) DUTIES OF LOCAL WORKFORCE DEVELOPMENT

24 BOARD.—
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1 (1) LOCAL WORKFORCE DEVELOPMENT

2 PLAN.—Each local workforce development board

3 shall develop a biennial strategic plan and provide

4 policy guidance with respect to workforce develop5 ment programs operated within their respective

6 workforce development areas. Such strategic plan

7 shall be consistent with the State’s collaborative

8 workforce development and literacy plan, be ap9 proved by the appropriate chief elected official or of10 ficials, and be submitted to the Governor for ap11 proval. If after a reasonable effort, a local workforce

12 development board is unable to obtain the approval

13 of the chief elected official or officials, the Board has

14 the authority to forward the plan, with the com15 ments of the chief elected official or officials, to the

16 Governor for final approval or disapproval. Such

17 local plan shall include the following:

18 (A) Both short-term and long-term goals,

19 and related strategies, to ensure that workforce

20 preparation and development programs, includ21 ing programs established pursuant to this Act,

22 title I of the Rehabilitation Act of 1973, and

23 the Wagner-Peyser Act, contribute to a coher24 ent workforce development system in the

25 workforce development area.
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1 (B) A description of the performance

2 measures to be used by the local workforce de3 velopment board for measuring the performance

4 of local service providers under chapter 2 of

5 title II, title III, and title I of the Rehabilita6 tion Act of 1973, and the performance of inte7 grated career center system operators, with

8 whom the Board contracts.

9 (C) A description of the local integrated

10 career center system to be established in the

11 workforce development area, including—

12 (i) a description of the process the

13 local workforce development board will use

14 to designate or establish a career center

15 system which ensures that the most effec16 tive and efficient service providers are cho17 sen;

18 (ii) an identification of the roles of in19 dividual workforce development programs

20 and programs authorized by the Wagner21 Peyser Act; and

22 (iii) a description of the funding

23 sources to be used in the operation of the

24 career center system.
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1 (D) A description of strategies the local

2 workforce development board will undertake to

3 fully involve local employers, local educational

4 agencies, postsecondary education institutions,

5 adult education and literacy providers, local

6 service providers, parents and other consumers,

7 including individuals with disabilities, and older

8 workers in the development of the workforce de9 velopment system.

10 (E) Such other information as requested

11 by the State.

12 (2) IDENTIFICATION OF OCCUPATIONS IN DE13 MAND AND TRAINING NEEDS.—The local workforce

14 development board shall use available labor market

15 information and other appropriate methods in order

16 to identify and assess the needs of the workforce de17 velopment area.

18 (3) BUDGET AND PROGRAM OVERSIGHT.—

19 (A) BUDGETING.—

20 (i) The local workforce development

21 board, working through the State adminis22 trative agent, shall develop a budget for

23 the purpose of carrying out local programs

24 established under chapter 2 of title II, title

25 III, and title I of the Rehabilitation Act of
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1 1973, and for integrated career center sys2 tems established or designated under sec3 tion 107 with the exception of funds made

4 available under the Wagner-Peyser Act.

5 (ii) Such budget shall be subject to

6 the approval of the appropriate chief elect7 ed official or officials in the workforce de8 velopment area.

9 (B) PROGRAM OVERSIGHT.—The local

10 workforce development board, in partnership

11 with the chief elected official or officials in the

12 workforce development area, shall conduct over13 sight of the workforce development programs

14 listed in subparagraph (A), and of the inte15 grated career center system established under

16 this title.

17 (4) ADMINISTRATION.—

18 (A) FISCAL AGENT.—

19 (i) The local workforce development

20 board may receive and disburse funds

21 made available for carrying out programs

22 authorized under chapter 2 of title II, title

23 III, and title I of the Rehabilitation Act of

24 1973 of this Act, or the local workforce de25 velopment board may designate a fiscal
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1 agent (which may include the State

2 through a mutual agreement between the

3 local board and the State), for the purpose

4 of disbursement of funds to career centers

5 and other service providers, as designated

6 by the local workforce development board.

7 (ii) The Board may employ its own

8 staff, independent of local programs and

9 service providers, and may solicit or accept

10 grants and contributions from sources

11 other than from this Act.

12 (B) LIMITATION.—The workforce develop13 ment board, or employees of such board, may

14 not operate programs established under this

15 Act. The Governor is authorized to prohibit the

16 employees of agencies providing staff support to

17 such local workforce development boards from

18 providing workforce development services to in19 dividuals served through the use of funds au20 thorized under this Act, and under title I of the

21 Rehabilitation Act of 1973.

22 (C) CONFLICT OF INTEREST.—A member

23 of a workforce development board may not—

24 (i) discuss or participate in board con25 sideration; or
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1 (ii) cast a vote;

2 regarding the provision of services by such

3 member (or by an organization that such mem4 ber represents) or regarding any matter that

5 would provide direct financial benefit to such

6 member. The Governor may enforce more rigor7 ous conflict of interest standards, as determined

8 appropriate.

9 (D) INDEPENDENT AUTHORITY.—

10 (i) The Board shall elect its own

11 chairperson from among the members of

12 the board.

13 (ii) The board may adopt bylaws and

14 other operating procedures as consistent

15 with the purposes of this Act, and with the

16 policies established in the State workforce

17 development and literacy plan.

18 (5) OTHER.—The Governor may require local

19 workforce development boards to carry out such

20 other duties as determined to be appropriate by the

21 Governor and the individuals and entities described

22 in section 103, through the collaborative process de23 scribed in the State plan.
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1 SEC. 107. ESTABLISHMENT OF INTEGRATED CAREER CEN2 TER SYSTEMS.

3 (a) IN GENERAL.—The Governor of a State that de4 sires to receive a grant under one or more of the programs

5 specified in section 102(b) shall ensure that each local

6 workforce development board establish or designate an in7 tegrated career center system in the workforce develop8 ment area of such board, consistent with criteria estab9 lished under subsection (b).

10 (b) STATE CRITERIA.—The Governor, through the

11 collaborative process described under section 103, is au12 thorized to establish statewide criteria for use by local

13 workforce development boards in the designation or estab14 lishment of integrated career center systems to ensure

15 that the most effective and efficient service providers are

16 chosen, consistent with the requirements prescribed under

17 subsection (c).

18 (c) INTEGRATED CAREER CENTER SYSTEM RE19 QUIREMENTS.—At a minimum, integrated career center

20 systems shall include—

21 (1) common intake;

22 (2) preliminary assessment;

23 (3) integrated job search assistance;

24 (4) to the extent practicable, as determined by

25 the Governor, unified and linked computer systems,

26 including the availability of labor market informa-
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1 tion as described under title II of the Wagner-Peyser

2 Act, as added by section 132 of this Act, and link3 ages through uniform management information sys4 tems; and

5 (5) to the extent practicable, as determined by

6 the Governor, at least one physical, co-located site

7 which provides comprehensive and fully integrated

8 workforce development services to any individual

9 seeking such services.

10 Local workforce development areas are encouraged to es11 tablish a network of comprehensive and fully-integrated

12 co-located career centers to provide the services described

13 in subsection (f), supplemented with multiple affiliated

14 sites or satellites that provide one or more of such services

15 and are linked through electronic and technological access

16 points. Such affiliated sites may include entities des17 ignated as having a specialization in addressing special

18 needs, such as the needs of individuals with disabilities.

19 (d) COMMON ACCESS.—Information pertaining to the

20 labor market which is compiled pursuant to title II of the

21 Wagner-Peyser Act, as added by section 132 of this Act,

22 shall be available, to the extent practicable, through inte23 grated electronic networks, at all integrated career centers

24 and affiliated sites.
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1 (e) ELIGIBILITY FOR DESIGNATION.—Any entity or

2 consortium of entities located in the workforce develop3 ment area may be designated by the local workforce devel4 opment board to operate an integrated career center or

5 to participate in an integrated career center system. Such

6 entities may include the following:

7 (1) Institutions of higher education.

8 (2) Area vocational education schools.

9 (3) Local employment service offices, estab10 lished under the Wagner-Peyser Act.

11 (4) Private nonprofit organizations, (including

12 community-based organizations).

13 (5) Private for-profit entities.

14 (6) Agencies of local governments.

15 (7) Other interested organizations and entities

16 of demonstrated effectiveness, including local cham17 bers of commerce and other business organizations,

18 consistent with State criteria established pursuant to

19 subsection (b).

20 (f) DUTIES.—Each integrated career center system

21 shall, to the extent practicable as determined by the Gov22 ernor, carry out the following duties:

23 (1) PROVISION OF CORE SERVICES.—An inte24 grated career center system shall make available the

25 following information and core services to individuals
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1 on a universal and nondiscriminatory basis, with

2 reasonable accommodations to address the needs of

3 individuals with disabilities, in the workforce devel4 opment area in which such center is located:

5 (A) Outreach and intake for services pro6 vided under chapter 2 of title II, title III, sub7 title A of title IV, and title I of the Rehabilita8 tion Act of 1973.

9 (B) A preliminary assessment of the skill

10 levels and the need for services of the individual

11 for programs under chapter 2 of title II, title

12 III, subtitle A of title IV, and title I of the Re13 habilitation Act of 1973 of individuals, which

14 may include such factors as basic skills, occupa15 tional skills, career development skills, prior

16 work experience, employability, interests, apti17 tudes, vocational rehabilitation needs, and sup18 portive service needs.

19 (C) Labor market information relating to

20 local and State, and if appropriate, to regional

21 or national, occupations in demand and skill re22 quirements for such occupations, including job

23 listings for the local labor market.

24 (D) Information relating to youth services,

25 including information on at-risk youth develop-
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1 ment and career preparation programs author2 ized under title II, on vocational education and

3 school-to-work opportunities, and on youth ap4 prenticeship opportunities.

5 (E) Career counseling and career planning

6 based on a preliminary assessment of the indi7 vidual.

8 (F) Job search assistance.

9 (G) Information related to vocational reha10 bilitation services, as provided for in title I of

11 the Rehabilitation Act of 1973.

12 (H) Information relating to federally fund13 ed education and job training programs (includ14 ing registered apprenticeships), and student aid

15 programs, including the eligibility requirements

16 of and services provided by such programs.

17 (I) Information on, and assistance in

18 accessing referral to additional services through

19 programs providing adult education and literacy

20 services, vocational rehabilitation, youth and

21 adult workforce preparation and development,

22 and supportive services, including those pro23 grams authorized in titles II through IV, title

24 I of the Rehabilitation Act of 1973, available in

25 the workforce development area.
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1 (J) Information on the extent to which the

2 services provided under titles II and III, sub3 title A of title IV, and title I of the Rehabilita4 tion Act of 1973, meet or exceed the expected

5 levels of performance described in the State and

6 local plans, and the performance-based informa7 tion provided by the State to local workforce de8 velopment boards on certified providers of edu9 cation and training, as required under section

10 108(d)(3).

11 (K) Acceptance of applications for unem12 ployment compensation.

13 (L) Other appropriate activities to assist

14 individuals into employment.

15 (2) DISTRIBUTION OF CAREER GRANTS.—A

16 center or an affiliated site may serve as the point of

17 distribution of career grants for education, training,

18 and vocational rehabilitation services to eligible indi19 viduals in accordance with section 108.

20 (3) SPECIAL ARRANGEMENTS.—For the pur21 pose of providing core services to individuals with se22 vere disabilities in the most effective and efficient

23 manner possible, the integrated career center system

24 may arrange to have such core services provided to

25 an individual by a certified provider or the State ei-
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1 ther on a contract basis or through the use of career

2 grants.

3 (g) ADDITIONAL SERVICES.—Integrated career cen4 ter systems, may provide customized workforce develop5 ment services to employers on a fee-for-service basis, as

6 determined by the local workforce development board.

7 (h) ALTERNATIVE STATE STRATEGY.—Through the

8 collaborative process described in section 103, the Gov9 ernor has the authority to develop alternative strategies

10 to the integrated career center system, which are designed

11 to accomplish the full integration of workforce develop12 ment programs. These alternative strategies shall be de13 scribed in a proposal to the Secretaries of Education and

14 Labor for joint review and approval or disapproval not

15 later than 60 days after the date of receipt of such pro16 posal.

17 SEC. 108. IDENTIFICATION OF ELIGIBLE EDUCATION,

18 TRAINING, AND VOCATIONAL REHABILITA19 TION SERVICE PROVIDERS.

20 (a) ELIGIBILITY REQUIREMENTS.—A program of21 fered by a provider of education and training services shall

22 be eligible to receive funds under title III, and title I of

23 the Rehabilitation Act of 1973 through the receipt of ca24 reer grants, or through contract, if such program and pro25 vider—
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1 (1) is either—

2 (A) eligible to participate in title IV of the

3 Higher Education Act of 1965, or

4 (B) determined to be eligible under the

5 procedures described in subsection (b); and

6 (2) provides the performance-based information

7 required pursuant to subsection (c), except that pro8 viders eligible under subparagraph (A) only have to

9 provide information for programs other than pro10 grams leading to a degree.

11 (b) ALTERNATIVE ELIGIBILITY PROCEDURE.—

12 (1) IN GENERAL.—The Governor shall establish

13 an alternative eligibility procedure for providers of

14 education, training, and vocational rehabilitation

15 services (which may include private sector, for profit

16 and nonprofit providers of such services) in any

17 State desiring to receive funds under title III of this

18 Act and title I of the Rehabilitation Act of 1973, but

19 that are not eligible to participate in title IV of the

20 Higher Education Act of 1965. Such procedure shall

21 establish minimum acceptable levels of performance

22 for such providers, and be based on guidelines devel23 oped by the Secretaries of Labor and Education.

24 The Governor may utilize such criteria to certify

25 service providers as having the ability to meet occu-
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1 pational skill standards promoted by the National

2 Skill Standards Board, or to meet, high, industry3 recognized standards that result in a portable skill

4 certificate in the subject, occupation, or industry for

5 which training is provided, except where such stand6 ards are not appropriate for the services rendered.

7 The Governor shall utilize the local workforce devel8 opment boards, for the identification of eligible

9 qualified providers of education, training, and voca10 tional rehabilitation services. During a transition pe11 riod, not to exceed 2 years, identification of eligible

12 programs and providers under this subsection may

13 be based on the performance of such programs and

14 providers under the Job Training Partnership Act,

15 the Rehabilitation Act of 1973, or other objective

16 measures of previous performance, such as employer

17 evaluations.

18 (2) Notwithstanding paragraph (1), if the par19 ticipation of an institution of higher education in

20 any of the programs under such title of such Act is

21 terminated, such institution shall not be eligible to

22 receive funds under this Act for a period of not less

23 than two years.

24 (c) PERFORMANCE-BASED INFORMATION.—The

25 State shall identify performance-based information that is
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1 to be submitted by providers of services for programs to

2 be eligible under this section. Such information may in3 clude information, relating to—

4 (1) the percentage of students completing the

5 programs conducted by the provider;

6 (2) the rates of licensure of graduates of the

7 programs conducted by the provider;

8 (3) the percentage of graduates of the programs

9 meeting industry-recognized skill standards and cer10 tification requirements that are at least as challeng11 ing as skill standards endorsed by the National Skill

12 Standards Board, once such standards are available.

13 (4) measures of program effectiveness such as

14 the rates of placement and retention in employment,

15 and the earnings of graduates of programs con16 ducted by the provider, employer evaluations of pro17 vider services, and adherence to accepted industry

18 quality standards (where available) by such provid19 ers;

20 (5) the percentage of students who obtained

21 employment in an occupation related to the program

22 conducted by the provider;

23 (6) the warranties or guarantees provided by

24 such provider relating to the skill levels or employ25 ment to be attained by students;
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1 (7) other information for providers of services

2 under title I of the Rehabilitation Act of 1973 that

3 reflects the priority of serving individuals with severe

4 disabilities; and

5 (8) the percentage of students who, as a result

6 of participation in the program demonstrate signifi7 cant gains in literacy and basic skills.

8 (d) ADMINISTRATION.—

9 (1) STATE AGENCY.—The Governor is author10 ized to designate a State agency to collect, verify,

11 and disseminate the performance-based information

12 submitted pursuant to subsection (c).

13 (2) APPLICATION.—A provider of education and

14 training services that desires to be eligible to receive

15 funds under this title shall submit the information

16 required under subsection (c) to the State agency

17 designated under paragraph (1) of this subsection at

18 such time and in such form as such State agency

19 may require.

20 (3) LIST OF ELIGIBLE PROVIDERS.—The State

21 agency shall compile a list of eligible programs and

22 providers, accompanied by the performance-based in23 formation submitted, and disseminate such list and

24 information to the local workforce development
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1 boards and integrated career center systems within

2 the State.

3 (4) ACCURACY OF INFORMATION.—

4 (A) IN GENERAL.—If the State agency de5 termines that information concerning a provider

6 is inaccurate, such provider shall be disqualified

7 from receiving funds under this title for a pe8 riod of not less than two years, unless such pro9 vider can demonstrate to the satisfaction of the

10 Governor or his or her designee, that the infor11 mation was provided in good faith.

12 (B) APPEAL.—The Governor shall estab13 lish a procedure for a service provider to appeal

14 a determination by a State agency that results

15 in a disqualification under subparagraph (A).

16 Such procedure shall provide an opportunity for

17 a hearing and prescribe appropriate time limits

18 to ensure prompt resolution of the appeal.

19 (5) ASSISTANCE IN DEVELOPING INFORMA20 TION.—The State agency established pursuant to

21 paragraph (1) may provide technical assistance to

22 education, training, and vocational rehabilitation

23 providers in developing the information required

24 under subsection (b). Such assistance may include

25 facilitating the utilization of State administrative
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1 records, such as unemployment compensation wage

2 records, and other appropriate coordination activi3 ties.

4 (e) ON-THE-JOB TRAINING EXCEPTION.—

5 (1) IN GENERAL.—Providers of on-the-job

6 training are not subject to the requirements of sub7 sections (a), (b), (c), and (d).

8 (2) COLLECTION AND DISSEMINATION OF IN9 FORMATION.—The Workforce Development Board

10 shall collect such performance-based information

11 from on-the-job training providers as the Governor

12 may require, and disseminate such information to

13 the local integrated career center systems.

14 (f) RULE OF CONSTRUCTION REGARDING STATE AS

15 PROVIDER OF SERVICES.—This section does not prohibit

16 a State from being a provider of education and training

17 services under title III, or under title I of the Rehabilita18 tion Act of 1973, subject to the State meeting the require19 ments of this section for serving as such a provider.

20 SEC. 109. MANAGEMENT INFORMATION SYSTEMS.

21 (a) IN GENERAL.—Each State is authorized to use

22 a portion of the funds it receives under this Act to design

23 a unified management information system that is in ac24 cordance with guidelines established jointly by the Sec25 retaries in consultation with the Governors.
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1 (b) REQUIREMENTS.—Each unified management in2 formation system shall, to the extent practicable as deter3 mined by the Governor—

4 (1) be utilized for federally required fiscal re5 porting and monitoring for each of the programs au6 thorized under this Act;

7 (2) be used by all agencies involved in

8 workforce development activities, including inte9 grated career center systems which shall have the

10 capability to track the overall public investments

11 within the State and workforce development areas,

12 and to inform policymakers as to the results being

13 achieved and the demographic characteristics of the

14 individuals served through that investment;

15 (3) contain a common structure of financial re16 porting requirements, fiscal systems and monitoring

17 for all workforce development expenditures included

18 in the workforce development system that shall uti19 lize common data elements and the definitions in20 cluded in section 5;

21 (4) support local efforts to establish workforce

22 development systems, including intake and eligibility

23 determination for all services; and

24 (5) contain data on the demographic character25 istics on the participants served by programs author-
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1 ized under this Act, which shall be collected, pro2 duced, and published by the Secretaries.

3 (c) PRIVACY.—Nothing in this Act shall violate the

4 provisions of the Family Education Rights and Privacy

5 Act under section 444 of the General Education Provi6 sions Act and the privacy and confidentiality provisions

7 under section 22(b) of title II of the Wagner Peyser Act

8 as amended by this Act.

9 SEC. 110. PERFORMANCE ACCOUNTABILITY SYSTEM.

10 (a) IN GENERAL.—In order to promote high levels

11 of performance and to ensure an appropriate return on

12 the Nation’s investment in the workforce development and

13 literacy system, each State receiving funds under this Act

14 shall develop, or have developed, a statewide performance

15 accountability system in accordance with the provisions of

16 this section.

17 (b) INDICATORS OF PERFORMANCE.—

18 (1) IN GENERAL.—Each State receiving funds

19 under this Act shall identify indicators of perform20 ance for each of the programs established under ti21 tles II through IV of this Act and title I of the Re22 habilitation Act of 1973, consistent with State goals

23 as described in the State plan in accordance with

24 section 104. Such indicators shall, at a minimum,

25 include the core indicators described in subsection
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1 (f), and be expressed in an objective, quantifiable,

2 and measurable form. Such indicators may also in3 clude post-program surveys measuring customer sat4 isfaction of both employers and program partici5 pants.

6 (2) TECHNICAL DEFINITIONS OF CORE INDICA7 TORS.—In order to ensure nationwide comparability

8 of performance data, the Secretary of Labor and the

9 Secretary of Education, in collaboration with the

10 States and with representatives of business and in11 dustry, employees, educational agencies, service pro12 viders, participants, parents and other interested

13 parties, shall promulgate technical definitions of

14 each of the core indicators described in subsection

15 (f), to be used under this Act in measuring perform16 ance.

17 (c) EXPECTED LEVELS OF PERFORMANCE.—

18 (1) IN GENERAL.—(A) Each State shall identify

19 the level of performance, consistent with State goals

20 described under section 104, that is expected for

21 local workforce development areas and other applica22 ble local administrative entities under this Act. In

23 determining such levels, the State shall take into ac24 count the challenging levels identified under para25 graph (2), and initially develop baseline levels of per-
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1 formance upon which the State will measure contin2 uous improvement.

3 (B) The Governor, through the collaborative

4 process, may adjust the expected level of perform5 ance with respect to each local area taking into ac6 count specific economic, demographic, and geo7 graphic factors, and the characteristics of the popu8 lation to be served.

9 (2) CHALLENGING LEVELS OF PERFORM10 ANCE.—In order to encourage high levels of per11 formance and advance the Nation’s competitiveness

12 in the global economy, the Secretary of Labor and

13 the Secretary of Education, in collaboration with the

14 States and with representatives of business and in15 dustry, employees, educational agencies, service pro16 viders, participants, parents and other interested

17 parties, shall identify challenging levels of perform18 ance with respect to appropriate core indicators se19 lected from among the core indicators described in

20 subsection (f). Where applicable, such challenging

21 levels of performance shall reflect industry-recog22 nized skill standards.

23 (d) REPORT ON PERFORMANCE.—

24 (1) IN GENERAL.—The State shall report to the

25 Secretary of Labor and the Secretary of Education,
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1 the levels of performance achieved by local workforce

2 development areas and other applicable local admin3 istrative entities with respect to the indicators iden4 tified pursuant to subsection (b)(1) for each pro5 gram year. The Secretaries shall make such infor6 mation available to the general public through publi7 cation and other appropriate methods, and shall dis8 seminate State-by-State comparisons, and compari9 sons with other industrialized nations (where appro10 priate).

11 (2) REPORTING OPTIONS.—In the collection

12 and reporting of such data, States are encouraged to

13 utilize administrative reporting data on quarterly

14 earnings, establishment and industry affiliation, and

15 geographic location of employment, such as unem16 ployment insurance wage-data records.

17 (e) CONSEQUENCES FOR POOR PERFORMANCE.—

18 (1) CRITERIA.—The Governor, through the col19 laborative process, is authorized to establish criteria

20 for determining whether local workforce development

21 areas and other applicable local administrative enti22 ties have failed to meet expected levels of perform23 ance with respect to programs under this Act.

24 (2) CONSEQUENCES FOR POOR PERFORM25 ANCE.—
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1 (A) STATE CONSEQUENCES.—If a State

2 fails to meet expected levels of performance for

3 a program for any program year as established

4 pursuant to subsection (a), the Secretary of

5 Education or the Secretary of Labor, as appro6 priate to the particular program, may provide

7 technical assistance, including assistance in the

8 development of a performance improvement

9 plan. If such failure continues for a second con10 secutive year, the appropriate Secretary may re11 duce by not more than 5 percent, the amount

12 of the grant that would (in the absence of this

13 paragraph) be payable to the State under such

14 program for the immediately succeeding pro15 gram year. Such penalty shall be based on the

16 degree of failure to meet expected levels of per17 formance.

18 (B) LOCAL CONSEQUENCES.—(i) If a local

19 workforce development area, or other applicable

20 local administrative entity, fails to meet ex21 pected levels of performance for a program for

22 any program year under the criteria established

23 in paragraph (1), the Governor, through the

24 collaborative process, may provide technical as-
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1 sistance, including the development of a per2 formance improvement plan.

3 (ii) If such failure continues for a second

4 consecutive year, the Governor may take correc5 tive actions, such as the withholding of funds,

6 the redesignation of a local administrative en7 tity, or such other actions as the Governor,

8 through the collaborative process, determines

9 are appropriate, consistent with State law, sec10 tion 104(c)(3) of this Act, and the requirements

11 of this Act.

12 (f) CORE INDICATORS OF PERFORMANCE.—

13 (1) COMMON CORE INDICATORS FOR ADULTS.—

14 In addition to the core indicators of performance de15 scribed in paragraph (2), common core indicators of

16 performance for programs conducted under titles III

17 and IV of this Act, and under title I of the Voca18 tional Rehabilitation Act of 1973 shall be weighted

19 and applied to each of the individual programs, ac20 cording to the purposes of such titles, and include

21 measures of—

22 (A) placement in unsubsidized employ23 ment;
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1 (B) retention in unsubsidized employment

2 for not less than 6 months and for not less than

3 12 months, respectively;

4 (C) increases in earnings, or in earnings in

5 combination with employer-assisted benefits;

6 (D) attainment of industry-recognized oc7 cupational skills, including basic workplace

8 competencies and industry-recognized skill

9 standards, which may include the acquisition of

10 a skill certificate in the occupation for which

11 the individual has been prepared;

12 (E) attainment of a high school diploma, a

13 general equivalency diploma, or a certificate of

14 completion of a program authorized under the

15 Rehabilitation Act of 1973; and

16 (F) such other measures of performance

17 that the State may wish to collect.

18 (2) ADDITIONAL CORE INDICATORS FOR

19 ADULTS.—

20 (A) ADULT EMPLOYMENT AND TRAINING

21 PROGRAMS.—In addition to the common core

22 indicators described in paragraph (1), the core

23 indicators of performance for programs con24 ducted under title III shall include measures of

25 the success of individuals with barriers to em-
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1 ployment, including dislocated workers, eco2 nomically disadvantaged individuals, older

3 workers, individuals with disabilities, displaced

4 homemakers, veterans, and individuals who are

5 basic skills deficient, in achieving performance

6 goals established pursuant to this Act.

7 (B) ADULT EDUCATION AND FAMILY LIT8 ERACY PROGRAMS.—In addition to the common

9 core indicators described in paragraph (1), the

10 core indicators of performance for programs

11 conducted under title IV shall include measures

12 of—

13 (i) the number of individuals who, as

14 a result of participation in programs fund15 ed under this Act, demonstrate significant

16 gains in literacy skills; and

17 (ii) such other measures of perform18 ance that the State may wish to collect, in19 cluding measures of the success of family

20 literacy programs, increased English lan21 guage skills, and increased community in22 volvement.

23 (C) PROGRAMS ESTABLISHED UNDER

24 TITLE I OF THE REHABILITATION ACT OF

25 1973.—In addition to the common core indica-
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1 tors described in paragraph (1), the core indica2 tors of performance for programs conducted

3 under title I of the Rehabilitation Act of 1973

4 shall include measures of the success of individ5 uals with severe disabilities, including those in6 dividuals determined to have a disability under

7 title II or title XVI of the Social Security Act,

8 in achieving performance goals established pur9 suant to this Act.

10 (3) CORE INDICATORS FOR YOUTH DEVELOP11 MENT AND CAREER PREPARATION PROGRAMS.—The

12 core indicators of performance for programs con13 ducted under title II shall include measures of—

14 (A) attainment of challenging State aca15 demic standards;

16 (B) attainment of a high school diploma or

17 a general equivalency diploma;

18 (C) attainment of industry-recognized oc19 cupational skills, including basic workplace

20 competencies and industry-recognized skill

21 standards, which may include the acquisition of

22 a skill certificate in the occupation for which

23 the individual has been prepared; if such skill

24 certificate is acquired in addition to or in com-
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1 bination with a high school diploma or general

2 equivalency diploma;

3 (D) reduction in school dropout rates;

4 (E) positive results such as placement in

5 postsecondary education or advanced training,

6 military service, employment, or registered ap7 prenticeships;

8 (F) the success of individuals described

9 under section 201(12) in achieving performance

10 goals established pursuant to this Act, including

11 placement in nontraditional training and em12 ployment; and

13 (G) such other measures of performance

14 that the State may wish to collect.

15 SEC. 111. LIMITATION ON FEDERAL REGULATIONS.

16 The Secretary of the Department of Labor and the

17 Secretary of the Department of Education shall issue reg18 ulations under this Act only to the extent that such regula19 tions are necessary to ensure that there is compliance with

20 the specific requirements of this Act.

21 SEC. 112. GENERAL PROVISION.

22 Nothing in this Act shall mandate that any individ23 ual, particularly youth served under title II of this Act,

24 be required to choose a specific career path or major.
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1 SEC. 113. LIABILITY.

2 Expenditures that are disallowed (except in the case

3 of fraud, embezzlement, or other criminal activities) under

4 this Act or under title I of the Rehabilitation Act of 1973,

5 may be repaid from funds allocated under the title for

6 which such disallowance occurs, in subsequent program

7 years or fiscal years, as appropriate, after the year in

8 which such disallowance occurred. The amount of funds

9 repaid should be equal to the amount of funds disallowed.

10 Subtitle B—Amendments to

11 Wagner-Peyser Act

12 SEC. 131. GENERAL PROGRAM REQUIREMENTS.

13 (a) DEFINITIONS.—Section 2 of the Act of June 6,

14 1933 (commonly known as the ‘‘Wagner-Peyser Act’’) (29

15 U.S.C. 49a) is amended—

16 (1) in paragraph (1), by striking ‘‘Job Training

17 Partnership Act’’ and inserting ‘‘Consolidated and

18 Reformed Education, Employment, and Rehabilita19 tion Systems Act’’;

20 (2) in paragraph (2) to read as follows:

21 ‘‘(2) the term ‘local workforce development

22 board’ means a local workforce development board

23 established under title I of the Consolidated and Re24 formed Education, Employment, and Rehabilitation

25 Systems Act;’’;

26 (3) in paragraph (4) to read as follows:
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1 ‘‘(4) the term ‘local workforce development

2 area’ means a local workforce development area es3 tablished under title I of the Consolidated and Re4 formed Education, Employment, and Rehabilitation

5 Systems Act;’’;

6 (4) in paragraph (5), by striking the period at

7 the end and inserting a semicolon; and

8 (5) by adding at the end the following new

9 paragraphs:

10 ‘‘(6) the term ‘public employment office’ means

11 an office which provides employment services to the

12 general public as part of an integrated career center

13 system; and

14 ‘‘(7) the term ‘integrated career center system’

15 means an integrated career center system estab16 lished under title I of the Consolidated and Re17 formed Education, Employment, and Rehabilitation

18 Systems Act.’’.

19 (b) DUTIES.—Section 3(a) of such Act (29 U.S.C.

20 49b(a)) is amended to read as follows:

21 ‘‘(a) The Secretary of Labor shall, pursuant to title

22 II of this Act—

23 ‘‘(1) assist in the coordination and development

24 of a nationwide system of labor exchange services for

25 the general public;
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1 ‘‘(2) assist in the development of performance

2 standards, benchmarks, and continuous improve3 ment models for such nationwide system which en4 sures private sector satisfaction and meets the de5 mands of jobseekers; and

6 ‘‘(3) ensure the continued services for individ7 uals receiving unemployment compensation.’’.

8 (c) REQUIREMENTS FOR RECEIPT OF FUNDS.—Sec9 tion 4 of such Act (29 U.S.C. 49c) is amended by striking

10 ‘‘a State shall, through its legislature’’ and inserting ‘‘the

11 Governor of a State shall, through the collaborative proc12 ess described in title I of the Consolidated and Reformed

13 Education, Employment, and Rehabilitation Systems

14 Act’’.

15 (d) AUTHORIZATION OF APPROPRIATIONS.—Section

16 5 of such Act (29 U.S.C. 49d) is amended by inserting

17 before the period at the end the following: ‘‘, of which not

18 less than 25 percent shall be for carrying out both section

19 14 and title II of this Act’’.

20 (e) USE OF FUNDS UNDER THIS ACT.—Section

21 7(c)(2) of such Act (29 U.S.C. 49f(c)(2)) is amended by

22 striking ‘‘any of the following provisions of law’’ and all

23 that follows and inserting ‘‘the Consolidated and Re24 formed Education, Employment, and Rehabilitation Sys25 tems Act.’’.
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1 (f) STATE PLAN.—Section 8 of such Act (29 U.S.C.

2 49g) is amended—

3 (1) in subsection (a) to read as follows:

4 ‘‘(a) Any State desiring to receive assistance under

5 this Act shall submit to the Secretary, as part of the State

6 workforce development and literacy plan authorized under

7 title I of the Consolidated and Reformed Education, Em8 ployment, and Rehabilitation Systems Act, detailed plans

9 for carrying out the provisions of this Act within such

10 State.’’;

11 (2) by striking subsections (b), (c), and (e); and

12 (3) by redesignating subsection (d) as sub13 section (b).

14 (g) ELIMINATION OF FEDERAL ADVISORY COUN15 CIL.—Section 11 of such Act (29 U.S.C. 49j) is hereby

16 repealed.

17 (h) CONFORMING AMENDMENTS.—

18 (1) Such Act is amended by inserting after sec19 tion 2 the following new heading:

20 ‘‘TITLE I—GENERAL PROGRAM

21 REQUIREMENTS’’.

22 (2) Section 4 of such Act is amended by strik23 ing ‘‘United States Employment Service’’ and insert24 ing ‘‘Secretary of Labor’’.
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1 (3) Section 7(b)(2) of such Act is amended by

2 striking ‘‘private industry council’’ and inserting

3 ‘‘local workforce development board’’.

4 (4) Section 7(d) of such Act is amended—

5 (A) by striking ‘‘United States Employ6 ment Service’’ and inserting ‘‘Secretary of

7 Labor’’; and

8 (B) by striking ‘‘Job Training Partnership

9 Act’’ and inserting ‘‘Consolidated and Reformed

10 Education, Employment, and Rehabilitation

11 Systems Act’’.

12 (5) Section 12 of such Act is amended by strik13 ing ‘‘The Director, with the approval of the Sec14 retary of Labor,’’ and inserting ‘‘The Secretary of

15 Labor’’.

16 SEC. 132. LABOR MARKET INFORMATION.

17 The Act of June 6, 1933 (commonly known as the

18 ‘‘Wagner-Peyser Act’’; 29 U.S.C. 49), as amended by sec19 tion 131, is further amended by adding at the end the

20 following new title:

21 ‘‘TITLE II—LABOR MARKET

22 INFORMATION

23 ‘‘SEC. 21. PURPOSE.

24 ‘‘The purpose of this title is to ensure a comprehen25 sive and coordinated system of labor market information
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1 which will provide locally based, accurate, up-to-date, eas2 ily accessible, and user friendly labor market information

3 through a cooperative Federal, State, and local governance

4 structure which includes partnerships with the private sec5 tor at all levels.

6 ‘‘SEC. 22. SYSTEM CONTENT.

7 ‘‘(a) IN GENERAL.—The Secretary of Labor, in ac8 cordance with the provisions of this title, shall oversee the

9 development, maintenance, and continuous improvement

10 of a nationwide system of labor market information using

11 statistically valid data, which include—

12 ‘‘(1) statistical data from survey and projection

13 programs and data from administrative reporting

14 systems, which, taken together, enumerate, estimate,

15 and project the supply and demand for labor at Fed16 eral, State, and local levels in a timely manner, in17 cluding data on—

18 ‘‘(A) the demographic characteristics, as

19 defined in section 5 of the Consolidated and Re20 formed Education, Employment, and Rehabili21 tation Systems Act, socioeconomic characteris22 tics, and current employment status of the pop23 ulation, including self-employed, part-time, and

24 seasonal workers, and individuals with severe
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1 disabilities, as such data are available from the

2 Bureau of Census and other sources;

3 ‘‘(B) job vacancies, education and training

4 requirements, skills, wages, benefits, working

5 conditions, and industrial distribution of occu6 pations, as well as current and projected em7 ployment opportunities and trends by industry

8 and occupation;

9 ‘‘(C) the educational attainment, training,

10 skills, skill levels, and occupations of the popu11 lation aggregates, as such data area are avail12 able from the Bureau of Census and other

13 sources;

14 ‘‘(D) information (such as unemployment

15 insurance wage data records) maintained in a

16 longitudinal manner on the quarterly earnings,

17 establishment and industry affiliation, and geo18 graphic location of employment; and

19 ‘‘(E) the incidence, industrial and geo20 graphical location, and number of workers dis21 placed by permanent layoffs and plant closings;

22 ‘‘(2) State and local employment and consumer

23 information on—

24 ‘‘(A) job openings, locations, hiring re25 quirements, and application procedures, as well
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1 as profiles of employers in the local labor mar2 ket describing the nature of work performed,

3 employment requirements, wages, benefits, and

4 hiring patterns as such information is volun5 teered by employers;

6 ‘‘(B) aggregate data on job seekers, includ7 ing their education and training, skills, skill lev8 els, employment experience, and employment

9 goals; and

10 ‘‘(C) education courses, training programs,

11 job placement programs, and vocational reha12 bilitation programs (where appropriate), includ13 ing—

14 ‘‘(i) program performance information

15 as required by this Act, such as summary

16 data on program completion, acquisition of

17 industry-recognized skill standards, job

18 placement, earnings, and the level of satis19 faction of the participants and their em20 ployers; and

21 ‘‘(ii) descriptive information on pro22 grams, such as eligibility requirements,

23 costs, financial support, or other support24 ive services, and other appropriate infor-
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1 mation which may be available with these

2 courses and programs;

3 ‘‘(3) technical standards for data and informa4 tion that will—

5 ‘‘(A) as a minimum guarantor of data use6 fulness and quality, ensure compatibility and

7 additivity of data and information to enable

8 comparisons among localities and States;

9 ‘‘(B) support standardization and aggrega10 tion of data and information from the adminis11 trative reporting systems of employment-related

12 programs; and

13 ‘‘(C) include—

14 ‘‘(i) classification and coding systems

15 for industries, occupations, skills, pro16 grams, and courses;

17 ‘‘(ii) nationally standardized defini18 tions of terms;

19 ‘‘(iii) a common system for designat20 ing geographic areas;

21 ‘‘(iv) quality control mechanisms for

22 data collection and analysis; and

23 ‘‘(v) common schedules for data col24 lection and dissemination;
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1 ‘‘(4) analysis of data and information for uses

2 including—

3 ‘‘(A) Federal, State, and local economic

4 policymaking;

5 ‘‘(B) the implementation of Federal poli6 cies, including the allocation of Federal funds

7 to States and localities and the facilitation of

8 job search and hiring in local labor markets;

9 ‘‘(C) Federal, State, and local program

10 planning and evaluation; and

11 ‘‘(D) research on labor market dynamics;

12 ‘‘(5) dissemination mechanisms for data and

13 analysis, including mechanisms which may be stand14 ardized among the States and technical standards in

15 the design of automated databases, and the design

16 of user interfaces and communications protocols;

17 ‘‘(6) programs of technical assistance for States

18 and localities in the development, maintenance, and

19 utilization of data, analysis, and dissemination

20 mechanisms, including assistance in adopting and

21 utilizing automated systems and improving the ac22 cess, through electronic and other means, of youth,

23 adults, and employers to labor market information

24 for localities, States, and the Nation;
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1 ‘‘(7) programs of research and demonstration,

2 which may be carried out by States and other public

3 or private entities, on ways to improve the products

4 and processes authorized in this title; and

5 ‘‘(8) objective performance measures, which will

6 allow for the continuous monitoring of the progress

7 of the labor market information system at national,

8 State, and local levels.

9 ‘‘(b) INFORMATION TO BE CONFIDENTIAL.—

10 ‘‘(1) IN GENERAL.—No officer or employee of

11 the Federal Government or agent of the Federal

12 Government may—

13 ‘‘(A) use the information furnished under

14 the provisions of this title for any purpose other

15 than the statistical purposes for which it is sup16 plied;

17 ‘‘(B) make any publication whereby the

18 data furnished by any particular establishment

19 or individual under this title can be individually

20 identified; or

21 ‘‘(C) permit anyone other than the sworn

22 officers and employees of any Federal depart23 ment or agency to examine the individual re24 ports.
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1 ‘‘(2) IMMUNITY FROM LEGAL PROCESS.—Any

2 information which is collected and retained under

3 this title shall be immune from the legal process and

4 shall not, without the consent of the individual or es5 tablishment concerned, be admitted as evidence or

6 used for any purpose in any action, suit, or other ju7 dicial or administrative proceeding.

8 ‘‘SEC. 23. FEDERAL RESPONSIBILITIES.

9 ‘‘(a) IN GENERAL.—The Nation’s labor market infor10 mation system shall be planned, administered, overseen,

11 and evaluated by a cooperative governance structure in12 volving the Federal Government, States, and local entities.

13 ‘‘(b) DUTIES.—The Secretary, with respect to data

14 collection, analysis, and dissemination of labor market in15 formation, shall carry out the following duties:

16 ‘‘(1) Ensure that all statistical and administra17 tive data collection activities within the Department

18 of Labor, including the Employment and Training

19 Administration, Veterans’ Employment and Training

20 Service, Employment Standards Administration, and

21 the Occupational Health and Safety Administration,

22 are consistent with those of the Bureau of Labor

23 Statistics.

24 ‘‘(2) Assign responsibilities, as appropriate, to

25 agencies such as the Employment and Training Ad-
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1 ministration to work with the Bureau of Labor Sta2 tistics in the collection, analysis and, particularly, in

3 the dissemination of labor market information, and

4 in the provision of training and technical assistance

5 to users of information, including the States, em6 ployers, youth, and adults.

7 ‘‘(3) In cooperation with other Federal agen8 cies, including the Department of Commerce, De9 partment of Defense, Department of the Treasury,

10 Department of Education, Department of Health

11 and Human Services, Department of Agriculture,

12 Department of Veterans’ Affairs, and the Office of

13 Management and Budget, establish and maintain

14 mechanisms for ensuring complementarity and non15 duplication in the development and operation of sta16 tistical and administrative data collection activities,

17 in order to ensure a comprehensive labor market in18 formation system.

19 ‘‘(4) Actively seek the participation of other

20 Federal agencies, particularly the National Center

21 for Education Statistics and the Division of Adult

22 and Vocational Education, and the Rehabilitation

23 Services Administration of the Department of Edu24 cation, the Veterans’ Employment and Training

25 Service of the Department of Labor and the Depart-
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1 ment of Veterans’ Affairs with respect to vocational

2 rehabilitation programs in the design and provision

3 of standardized information to the States to support

4 section 22(2), and in the dissemination of labor mar5 ket information.

6 ‘‘(5) Establish confidentiality standards for the

7 labor market information system at Federal, State,

8 and local levels, including such provisions as may be

9 necessary, to be taken in coordination with the

10 States, to ensure that privacy and confidentiality

11 protections are guaranteed with respect to individ12 uals and firm data.

13 ‘‘(c) ADDITIONAL DUTIES.—The Secretary, in col14 laboration with the Bureau of Labor Statistics, with the

15 assistance of other agencies of the Department where ap16 propriate, shall—

17 ‘‘(1) establish and maintain, with the coopera18 tion of the States, elements of the system described

19 in sections 22(a)(1) and 22(a)(3);

20 ‘‘(2) develop and promulgate standards, defini21 tions, formats, collection methodologies, and other

22 necessary system elements for the use of the States

23 in their assembling and presentation of the employ24 ment information specified in section 22(a)(2);
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1 ‘‘(3) eliminate gaps and duplication in statis2 tical undertakings, with the systemization of wage

3 surveys as an early priority;

4 ‘‘(4) recommend any needed improvements in

5 administrative reporting systems to support the de6 velopment of labor market information from their

7 data; and

8 ‘‘(5) ensure that—

9 ‘‘(A) data are sufficiently timely relevant

10 to employers and other users, and locally de11 tailed for uses including those specified in sec12 tion 22(a)(4);

13 ‘‘(B) administrative records are standard14 ized to facilitate the aggregation of data from

15 local to State and national levels and to support

16 the creation of new statistical series from pro17 gram records; and

18 ‘‘(C) paperwork and reporting require19 ments on employers and individuals are re20 duced.

21 ‘‘SEC. 24. ANNUAL PLAN.

22 ‘‘(a) IN GENERAL.—The Secretary of Labor, in col23 laboration with the Bureau of Labor Statistics, and with

24 assistance of other appropriate Federal agencies, shall

25 prepare an annual plan to be the operational mechanism
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1 for achieving a cooperative Federal/State governance

2 structure for labor market information and provide the

3 written justification for the Department of Labor’s budget

4 request to Congress by describing the activities and prior5 ities of the Bureau of Labor Statistics, other offices within

6 the Department of Labor, and other Federal agencies with

7 regard to data collection, analysis, and dissemination of

8 labor market information for fiscal years succeeding the

9 fiscal year in which the plan is developed and shall in10 clude—

11 ‘‘(1) the results of a periodic review of users’

12 needs and priorities, including the identification of

13 new employment issues and the attendant emergence

14 of new needs, on the part of Congress, the States,

15 employers, youth, and adults, for data, analysis, and

16 dissemination;

17 ‘‘(2) an evaluation, including the results of ob18 jective measures, of the performance of the labor

19 market information system in meeting these needs

20 and the steps to be taken to overcome deficiencies;

21 ‘‘(3) a summary of ongoing data programs and

22 activities under section 22 and a description of the

23 development of new data programs, analytical tech24 niques, definitions and standards, dissemination

25 mechanisms, training and technical assistance, gov-
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1 ernance mechanisms, and funding processes to meet

2 new needs; and

3 ‘‘(4) the results of an annual review of the costs

4 to the States of meeting contract requirements for

5 data production under this title, including a descrip6 tion of how the Secretary’s requested budget will

7 cover these costs.

8 ‘‘(b) COOPERATION WITH THE STATES.—The Sec9 retary and the Bureau of Labor Statistics, in cooperation

10 with the States, shall develop the plan by—

11 ‘‘(1) establishing procedures and mechanisms

12 for holding formal and periodic consultations on

13 products and administration of the system, at least

14 once each quarter, with representatives of employers

15 as well as with representatives of the States from

16 each of the 10 Federal regions of the Department of

17 Labor, elected by and from among the State direc18 tors of labor market information, according to a

19 process set forth by the Secretary; and

20 ‘‘(2) incorporating in the annual plan, for its

21 submission to Congress, the results of these con22 sultations, including any supplementary or dissent23 ing views from representatives of the States.

24 ‘‘(c) REPRESENTATIVES OF STATES DEEMED TO BE

25 FEDERAL EMPLOYEES.—For purposes of the development
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1 of the annual plan and to meet the provisions of Office

2 of Management and Budget Circular A–11, the represent3 atives of the States, elected in accordance with subsection

4 (b)(1), shall be considered to be employees of the Depart5 ment of Labor.

6 ‘‘SEC. 25. GOVERNOR’S RESPONSIBILITIES.

7 ‘‘(a) DESIGNATION OF STATE AGENCY.—The Gov8 ernor of each State shall designate a single State agency

9 to be the agency responsible for the management and over10 sight of a statewide comprehensive labor market informa11 tion system and for the State’s participation in the cooper12 ative Federal/State governance structure for the nation13 wide labor market information system.

14 ‘‘(b) DUTIES.—In order to receive Federal financial

15 assistance under this Act, the State agency shall—

16 ‘‘(1) develop, maintain, and continuously im17 prove a comprehensive labor market information sys18 tem, which shall—

19 ‘‘(A) include all the elements specified in

20 section 22; and

21 ‘‘(B) be responsive to the needs of the

22 State and its localities for planning and evalua23 tive data, including employment and economic

24 analyses and projections, as required by this

25 Act, the Consolidated and Reformed Education,
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1 Employment, and Rehabilitation Systems Act,

2 the Social Security Act, and other provisions of

3 law which require the use of labor market infor4 mation;

5 ‘‘(2) ensure the performance of contract and

6 grant responsibilities for data collection, analysis,

7 and dissemination;

8 ‘‘(3) conduct such other data collection, analy9 sis, and dissemination activities as will ensure com10 prehensive State and local labor market information;

11 ‘‘(4) actively seek the participation of other

12 State and local agencies, with particular attention to

13 State education, economic development, human serv14 ices, and welfare agencies, in data collection, analy15 sis, and dissemination activities in order to ensure

16 complementarity and compatibility among data; and

17 ‘‘(5) participate in the development of the na18 tional annual plan.’’.

19 Subtitle C—General Provision

20 SEC. 141. WORKER RIGHTS.

21 The following requirements shall apply to programs

22 under titles II and III of this Act:

23 (1) PROHIBITION ON DISPLACEMENT.—A par24 ticipant in a program under titles II or III shall not

25 displace any currently employed worker (including a
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1 partial displacement, such as a reduction in the

2 hours of non-overtime work, wages, or employment

3 benefits).

4 (2) PROHIBITION ON IMPAIRMENT OF CON5 TRACTS.—A program under title II or III shall not

6 impair existing contracts for services or collective

7 bargaining agreements, and no such program that

8 would be inconsistent with the terms of a collective

9 bargaining agreement shall be undertaken without

10 the written concurrence of the labor organization

11 and employer concerned.

12 (3) PROHIBITION ON REPLACEMENT.—A partic13 ipant in a program under title II or III shall not be

14 employed—

15 (A) when any other individual is on tem16 porary layoff, with the clear possibility of recall,

17 from the same or any substantially equivalent

18 job with the participating employer; or

19 (B) when the employer has terminated the

20 employment of any regular employee or other21 wise reduced the workforce of the employer with

22 the intention of filling the vacancy so created

23 with the student.

24 (4) WORKPLACES.—A participant in a program

25 under title II or III shall be provided with adequate
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1 and safe equipment and safe and healthful work2 places in conformity with all health and safety re3 quirements of Federal, State, and local law.

4 (5) EFFECT ON OTHER LAWS.—Nothing in this

5 Act shall be construed to modify or affect any Fed6 eral or State law prohibiting discrimination on the

7 basis of race, religion, color, ethnicity, national ori8 gin, gender, age, or disability, or to modify or affect

9 any right to enforcement of this Act that may exist

10 under other Federal laws, except as expressly pro11 vided by this Act.

12 SEC. 142. TRANSFERABILITY.

13 The Governor, through the collaborative process, has

14 the authority to transfer not more than 10 percent of the

15 total allotment to a State under title II or title III of this

16 Act, between such titles. Funds transferred under this au17 thority must be distributed to local providers in accord18 ance with the provisions of title II and III of this Act.

19 TITLE II—YOUTH DEVELOPMENT

20 AND CAREER PREPARATION

21 CONSOLIDATION GRANT

22 SEC. 201. PURPOSES.

23 It is the purpose of this title to provide States and

24 local communities maximum flexibility in designing youth

25 development and career preparation programs that—
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1 (1) help youth attain the academic skills and

2 occupational skills needed to be successful in a glob3 al economy and for lifelong learning;

4 (2) best suit the needs of in-school and at-risk

5 youth in their communities;

6 (3) promote strong connections between in7 school and at-risk programs, to ensure that youth

8 are prepared for further education opportunities and

9 good jobs, and promote youth development and ca10 reer preparation programs that provide opportunities

11 for youth to receive postsecondary education and oc12 cupational training;

13 (4) promote the formation of education and

14 business partnerships that are dedicated to linking

15 the worlds of school and work; and

16 (5) promote high academic and occupational

17 standards and quality vocational-technical education,

18 including improved secondary and postsecondary

19 programs, by focusing resources on program im20 provement initiatives that help prepare youth for

21 further education, training, and high-wage jobs in

22 high-performance workplaces.

23 SEC. 202. DEFINITIONS.

24 For purposes of this title:
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1 (1) The term ‘‘administration’’ means activities

2 of a State necessary for the proper and efficient per3 formance of its duties under this title, including su4 pervision, but does not include curriculum develop5 ment activities, personnel development, or research

6 activities.

7 (2) The term ‘‘all aspects of the industry’’

8 means strong experience in, and understanding of,

9 all aspects of the industry that youth are preparing

10 to enter, including planning, management, finances,

11 technical and production skills, underlying principles

12 of technology, labor issues, and health and safety.

13 (3) The term ‘‘articulation agreement’’ means a

14 commitment to a program designed to provide stu15 dents with a nonduplicative sequence of progressive

16 coursework in secondary and postsecondary edu17 cation.

18 (4) The term ‘‘cooperative education’’ means a

19 method of instruction of education for youth who,

20 through written cooperative arrangements between

21 the school and employers, receive instruction, includ22 ing required academic courses and related instruc23 tion by alternation of study in school with a job in

24 any occupational field. Such alternation shall be

25 planned and supervised by the school and employers
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1 so that each contributes to the youth’s education

2 and employability. Work periods and school attend3 ance may be on alternate half days, full days, weeks,

4 or other periods of time in fulfilling the cooperative

5 program.

6 (5) The term ‘‘corrections vocational education’’

7 means programs administered by the State to assist

8 juvenile and adult criminal offenders in correctional

9 institutions in the State, including correctional insti10 tutions operated by local authorities.

11 (6) The term ‘‘curricula’’ means instructional

12 and related or supportive material, including mate13 rials using advanced learning technology, in any oc14 cupational field which is designed to strengthen the

15 academic foundation and prepare youth for employ16 ment at the entry level or to upgrade occupational

17 competencies of those previously or presently em18 ployed in any occupational field, and appropriate

19 counseling and guidance material.

20 (7) Except as otherwise provided, the term ‘‘eli21 gible institution’’ means a local educational agency,

22 an area vocational education school, an intermediate

23 educational agency, an institution of higher edu24 cation (as such term is defined in section 1201(a) of

25 the Higher Education Act of 1965), a State correc-
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1 tions educational agency, or consortia of such enti2 ties.

3 (8) The term ‘‘partnership’’ means a local en4 tity that is responsible for local youth development

5 and career preparation programs and may consist of

6 parents, employers, representatives of local edu7 cational agencies and local postsecondary edu8 cational institutions (including representatives of

9 area vocational education schools, where applicable),

10 local educators (such as teachers, counselors, or ad11 ministrators), representative employee organizations,

12 students, and may include other entities.

13 (9) The term ‘‘Secretary’’ means the Secretary

14 of Education.

15 (10) The term ‘‘sequential course of study’’

16 means an integrated series of courses which are di17 rectly related to the educational and occupational

18 skill preparation of youth for jobs, or preparation for

19 postsecondary education.

20 (11) The term ‘‘single parent’’ means an indi21 vidual who—

22 (A) is unmarried or legally separated from

23 a spouse; and
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1 (B)(i) has a minor child or children for

2 whom the parent has either custody or joint

3 custody; or

4 (ii) is pregnant.

5 (12) The term ‘‘special populations’’ includes

6 individuals with disabilities, economically disadvan7 taged individuals, individuals of limited English pro8 ficiency, and individuals who are eligible for non9 traditional training and employment.

10 (13) The term ‘‘tech-prep education program’’

11 means a program of study which—

12 (A) combines at least 2 years of secondary

13 and 2 years of postsecondary education in a

14 nonduplicative sequential course of study;

15 (B) integrates academic and vocational in16 struction;

17 (C) provides technical preparation in at

18 least 1 field of engineering technology, applied

19 science, mechanical, industrial, or practical arts

20 or trade, or agriculture, health occupations, or

21 business;

22 (D) builds student competence in mathe23 matics, science, communications, and workplace

24 skills, through applied academics and integrated

25 instruction in a coherent sequence of courses;
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1 (E) leads to an associate degree or certifi2 cate in a specific career field;

3 (F) leads to placement in appropriate em4 ployment or further education; and

5 (G) enables a student to fulfill a career re6 lating to labor market needs.

7 (14) The term ‘‘vocational education’’ means

8 organized educational programs offering a sequence

9 of courses which are directly related to the prepara10 tion of youth in paid or unpaid employment in cur11 rent or emerging occupations, including

12 nonbaccalaureate certificate and degree programs

13 and baccalaureate vocational degree programs. Such

14 programs include competency-based applied learning

15 which contributes to a youth’s academic knowledge,

16 higher-order reasoning, and problem-solving skills,

17 work attitudes, general employability skills, and the

18 occupational-specific skills necessary for economic

19 independence as a productive and contributing mem20 ber of society. Such term also includes applied tech21 nology education.

22 (15) The term ‘‘vocational student organiza23 tions’’ means those organizations for individuals en24 rolled in vocational education programs which en25 gage in activities as an integral part of the instruc-
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1 tional program. Such organizations may have State

2 and national units which aggregate the work and

3 purposes of instruction in vocational education at

4 the local level.

5 Subtitle A—State Funding

6 SEC. 211. NATIONAL AND STATE FUNDING.

7 (a) NATIONAL PROGRAMS.—In each fiscal year, of

8 the amounts made available under section 4, the Secretary

9 is authorized to reserve 20 percent or $25,000,000, which10 ever is less, to carry out the provisions of subtitle D.

11 (b) STATE ALLOTMENT.—

12 (1) IN GENERAL.—Of the funds remaining after

13 the reservation under subsection (a), the Secretary

14 shall allot to each State for each fiscal year an

15 amount based on that State’s allotment percentage.

16 (2) ALLOTMENT PERCENTAGE.—(A) Except as

17 provided in subparagraph (B), the allotment per18 centage of a State for a fiscal year shall be the same

19 percentage of funds allotted to the State under this

20 section in the preceding fiscal year.

21 (B) The allotment percentage of a State for fis22 cal year 1996 shall be the percentage of funds allot23 ted to the State in fiscal year 1995 under—

24 (i) section 101 or 101A of the Carl D. Per25 kins Vocational and Applied Technology Edu-
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1 cation Act as such Act was in effect on the day

2 before the date of the enactment of this Act;

3 and

4 (ii) the funding allotted in fiscal year 1995

5 under section 252 and 262 of the Job Training

6 Partnership Act as such Act was in effect on

7 the day before the date of the enactment of this

8 Act.

9 (3) STATE MINIMUM.—Notwithstanding any

10 other provision of law and subject to paragraph (1),

11 any fiscal year for which the amounts appropriated

12 for programs authorized by this title exceed the

13 amounts available under subparagraph (B) for fiscal

14 year 1995, a State shall receive not less than one15 quarter of one percent of the amount available for

16 each such program for that fiscal year under this

17 subsection. Amounts necessary for increasing such

18 payments to States to comply with the preceding

19 sentence shall be obtained by ratably reducing the

20 amounts to be paid to other States.

21 (4) DEFINITION.—For the purposes of this sub22 section the term ‘‘State’’ means, in addition to the

23 several States, the District of Columbia, the Com24 monwealth of Puerto Rico, the Virgin Islands,
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1 Guam, American Samoa, and the Northern Mariana

2 Islands.

3 (c) FUNDING FOR STATE PROGRAMS.—Of the funds

4 allotted to a State under subsection (b) for each fiscal

5 year, the Governor, through the collaborative process,

6 shall—

7 (1) make available not less than 90 percent to

8 local providers;

9 (2) make available not more than 8 percent for

10 State programs described in section 222; and

11 (3) make available not more than 2 percent for

12 administrative purposes at the State level.

13 (d) PROVISO.—None of the funds made available

14 under this title shall be used to compel any youth to pur15 sue a specific career. Youth participating in programs

16 under this title shall be eligible to change their course of

17 study and training.

18 SEC. 212. WITHIN STATE ALLOCATION.

19 (a) IN GENERAL.—

20 (1) ALLOCATION OF FUNDS.—From the

21 amounts made available pursuant to section

22 211(c)(1), the Governor, through the collaborative

23 process, shall—

24 (A) allocate to eligible institutions an

25 amount equal to not less than 40 percent of
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1 such amount for in-school youth programs de2 scribed in section 241;

3 (B) allocate to local workforce development

4 boards an amount equal to not less than 40

5 percent of such amount for at-risk youth pro6 grams described in section 245.

7 (2) DISCRETIONARY FUNDS.—From the

8 amounts made available pursuant to section

9 211(c)(1), the Governor, through the collaborative

10 process, is authorized to provide 10 percent of such

11 amounts for discretionary purposes, as determined

12 by the Governor, to eligible institutions or local

13 workforce development boards for in-school and at14 risk youth.

15 (3) REMAINDER OF FUNDS.—From the remain16 der of amounts made available pursuant to section

17 211(c)(1) and distributed pursuant to paragraphs

18 (1) and (2) of this subsection, the Governor, through

19 the collaborative process, shall allocate the remain20 der of any such amounts to carry out the purposes

21 of subparagraphs (A) or (B) of paragraph (1).

22 (b) WITHIN STATE FORMULA.—

23 (1) ESTABLISHMENT.—The Governor, through

24 the collaborative process, and after consultation with

25 local chief elected officials in the local workforce de-
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1 velopment area and, where appropriate, local edu2 cators in such area, shall develop a formula for the

3 allocation of funds in accordance with paragraph (1)

4 of subsection (a). Such formula shall take into ac5 count—

6 (A) poverty rates within each local commu7 nity, as determined by the State;

8 (B) the proportion of the State’s youth

9 population residing within each local commu10 nity; and

11 (C) such other factors as considered appro12 priate.

13 (2) ADDITIONAL FACTORS.—In establishing

14 such formula, the Governor shall ensure that funds

15 are distributed equitably throughout the State, and

16 that the factors described in paragraph (1) do not

17 receive disproportionate weighting.

18 (c) MINIMUM GRANT AMOUNTS.—

19 (1) LOCAL EDUCATIONAL AGENCIES.—A local

20 educational agency or consortium of such agencies

21 that receives a subgrant from a State under para22 graph (1) of subsection (a) for any fiscal year shall

23 receive not less than $15,000.

24 (2) POSTSECONDARY INSTITUTIONS.—A post25 secondary institution or consortium of such institu-
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1 tions that receives a subgrant from a State under

2 paragraph (1) of subsection (a) for any fiscal year

3 shall receive not less than $50,000.

4 (3) LOCAL DEVELOPMENT BOARD.—A local de5 velopment board that receives a subgrant from a

6 State under paragraph (1) of subsection (a) for any

7 fiscal year shall receive not less than $15,000.

8 (4) SECONDARY-POSTSECONDARY CONSOR9 TIA.—One or more local educational agencies and

10 one or more eligible institutions may enter into a

11 consortium agreement. A consortium formed pursu12 ant to this paragraph that receives a subgrant from

13 a State under this subtitle shall receive not less than

14 $50,000 in any fiscal year.

15 (d) FUNDS TO CONSORTIUM.—Funds allocated to a

16 consortium formed to meet the requirements of subsection

17 (c) shall be used only for purposes and activities that are

18 mutually beneficial to all members of the consortium. Such

19 funds may not be reallocated to individual members of the

20 consortium for purposes or activities benefiting only one

21 member of the consortium.

22 (e) WAIVER.—The State may waive the application

23 of subsection (c) in any case in which a grant recipient—

24 (1) is located in a rural, sparsely-populated

25 area; and
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1 (2) demonstrates an inability to enter into a

2 consortium for purposes of providing services under

3 this title.

4 Subtitle B—State Organizational,

5 Planning, and Reporting Re6 sponsibilities

7 SEC. 221. STATE PLAN.

8 In addition to the requirements described in title I,

9 a State that desires to receive funds for any fiscal year

10 under this title shall, as part of the State Workforce De11 velopment and Literacy Plan under title I, submit to the

12 Secretary of Education information that includes—

13 (1) a description of the State’s plan to develop

14 the academic and occupational skills of youth and

15 provide the attainment of challenging vocational16 technical education standards, including industry-ap17 proved skill standards and workplace competencies;

18 (2) a description of how the State will improve

19 comprehensive career guidance and counseling which

20 may include linkages to career exploration and guid21 ance counseling outside of the school system and

22 shall describe how the State will effectively dem23 onstrate the system of career preparation for youth,

24 which includes elements such as professional devel25 opment, and secondary-postsecondary collaborations;
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1 (3) a description of the strategy of the State for

2 integrating academic, vocational, and work-based

3 learning, including a description of how the State

4 will promote collaboration between secondary and

5 postsecondary occupational and academic programs

6 and institutions and incorporating learning in all as7 pects of the industry; and

8 (4) a description of how the State will promote

9 the active involvement of parents and business (in10 cluding small- and medium-sized businesses) in the

11 planning, development, and implementation of youth

12 development and career preparation programs au13 thorized under this title.

14 SEC. 222. STATE PROGRAMS AND STATE ACTIVITIES.

15 (a) GENERAL AUTHORITY.—From amounts made

16 available to a State under section 211(c)(2), each State

17 shall conduct State programs and activities.

18 (b) USES OF FUNDS.—The programs and activities

19 described in subsection (a) may include—

20 (1) an assessment of programs conducted with

21 assistance under this title, including the development

22 of—

23 (A) performance indicators and measures

24 for such programs; and
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1 (B) program improvement and accountabil2 ity with respect to such programs;

3 (2) the support for tech-prep education;

4 (3) support for workforce preparation programs

5 for single parents, displaced homemakers, and single

6 pregnant women;

7 (4) support for corrections vocational education;

8 (5) professional development activities for voca9 tional teachers, academic teachers, school adminis10 trators, counselors, workplace mentors, and local

11 providers regarding integration of vocational, aca12 demic, and work-based curricula, including—

13 (A) inservice and preservice training of

14 teachers and faculty in state-of-the-art pro15 grams and techniques and nontraditional train16 ing and employment; and

17 (B) support of public teacher-education

18 programs to ensure vocational teachers stay

19 current with the needs, expectations, and meth20 ods of industry to meet employer standards;

21 (6) development, dissemination, and field test22 ing of curricula, especially—

23 (A) curricula that integrate vocational,

24 academic, and work-based methodologies;
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1 (B) curricula that provide a coherent se2 quence of courses through which academic and

3 occupational skills may be measured; and

4 (C) curricula for work-based learning;

5 (7) leadership and instructional programs in

6 technology education;

7 (8) support for cooperative education;

8 (9) support for family and consumer science

9 programs;

10 (10) creative use of technologies, including pro11 fessional development in the use of such technologies

12 for instructional purposes and to increase coun13 selor’s and youth’s knowledge of, and use of, addi14 tional information resources;

15 (11) support for vocational student organiza16 tions; and

17 (12) improving comprehensive career guidance

18 and counseling.

19 SEC. 223. INCENTIVE AWARDS.

20 The State, may, from the amount made available

21 under section 211(c)(2) for any fiscal year make perform22 ance awards to 1 or more eligible institutions or local pro23 viders that have—

24 (1) exceeded in the performance goals described

25 in section 110(f)(3);
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1 (2) implemented exemplary youth development

2 and career preparation programs at the local level in

3 accordance with the purposes described in section

4 201; or

5 (3) provided exemplary education services and

6 activities for at-risk youth.

7 Subtitle C—Subgrants for In8 School and At-Risk Youth

9 SEC. 231. PARTNERSHIP AGREEMENTS.

10 (a) PARTNERSHIP.—A local workforce development

11 board and eligible institutions that desire to receive a

12 subgrant from a State under this subtitle in any fiscal

13 year shall form a partnership for the purposes of collabo14 rative planning, coordination of in-school and at-risk pro15 grams, and effective public participation.

16 (b) PLAN.—

17 (1) IN GENERAL.—The partnership referred to

18 in subsection (a) shall, in collaboration, develop and

19 submit for approval to the Governor through the

20 State collaborative process a comprehensive youth

21 development and career preparation plan for in22 school and at-risk youth. Such plan shall describe

23 how the youth development and career preparation

24 system meets the requirements of sections 241 and
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1 245 and shall address comments received through

2 the collaborative process.

3 (2) COLLABORATIVE PROCESS.—The partner4 ship shall assure the involvement of parents, teach5 ers, and the community in the collaborative planning

6 process which involves design of the indicators,

7 strategies, articulation, and cooperative agreements,

8 assessments, and evaluation of program activities.

9 (3) DISPUTES.—In the event a partnership can10 not come to agreement on the content of local plans,

11 the Governor, through the collaborative process, is

12 authorized to develop procedures for the resolution

13 of issues in dispute.

14 SEC. 232. DISTRIBUTION OF FUNDS.

15 (a) IN-SCHOOL PROGRAMS.—Based upon an applica16 tion submitted by the partnership to the Governor through

17 the State collaborative process, a State shall distribute

18 funds made available in a fiscal year as provided in section

19 212(a)(1)(A) to eligible institutions to carry out in-school

20 youth programs described in section 241.

21 (b) AT-RISK YOUTH PROGRAMS.—A State shall dis22 tribute funds made available in any fiscal year as provided

23 in section 212(a)(1)(B) to local workforce development

24 boards to carry out at-risk youth programs described in

25 section 245.
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1 CHAPTER 1—IN-SCHOOL YOUTH

2 SEC. 241. USES OF FUNDS FOR IN-SCHOOL YOUTH.

3 (a) GENERAL AUTHORITY.—Each eligible institution

4 that receives a subgrant under this chapter shall use funds

5 provided under such grant to improve youth development

6 and career preparation programs.

7 (b) REQUIREMENTS FOR USES OF FUNDS.—Funds

8 provided by a State pursuant to section 212(a)(1)(A) shall

9 be used to provide in-school youth development and career

10 preparation programs that—

11 (1) are of such size, scope, and quality as to be

12 effective;

13 (2) integrate academic, vocational, and work14 based learning, stressing applied and contextual

15 learning, through a coherent sequence of courses so

16 that youth achieve both academic and occupational

17 competencies and have strong experience in, and un18 derstanding of, all aspects of the industry;

19 (3) involve employers in the design and imple20 mentation of programs;

21 (4) establish effective linkages with at-risk

22 youth programs, secondary and postsecondary edu23 cation;

24 (5) provide work-based learning experiences

25 with adult mentoring where appropriate; and
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1 (6) provide comprehensive career guidance and

2 counseling, including exploration in the practical

3 arts or trade.

4 (c) ADDITIONAL USES OF FUNDS.—In carrying out

5 the provisions of subsection (b), funds may be used by an

6 eligible institution for in-school youth activities such as—

7 (1) purchasing, leasing, or upgrading of equip8 ment, including instructional aids and material;

9 (2) inservice training of vocational instructors,

10 academic instructors, employers, and workplace

11 mentors, to integrate academic and vocational edu12 cation, and provide high-quality school-based and

13 work-based learning experiences;

14 (3) tech-prep education programs;

15 (4) supplementary services designed to meet the

16 needs of special populations;

17 (5) adaptation of equipment;

18 (6) apprenticeship programs;

19 (7) comprehensive mentoring programs in insti20 tutions of higher education offering comprehensive

21 programs in teacher preparation which seek to fully

22 use the skills and work experiences of individuals

23 currently or formerly employed in business and in24 dustry, who are interested in becoming classroom in25 structors, and to meet the need of vocational edu-
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1 cators who wish to upgrade their teaching com2 petencies;

3 (8) local education and business partnerships

4 for developing and implementing school-based youth

5 development and career preparation systems;

6 (9) support for vocational student organiza7 tions;

8 (10) establishing effective activities and proce9 dures to enable program participants and their par10 ents to participate directly in decisions that influ11 ence the character of programs, including providing

12 information and assistance needed for informed and

13 effective participation; and

14 (11) support for programs which prepare youth

15 with skills for personal and family life management,

16 work, and leadership in the community and the Na17 tion.

18 CHAPTER 2—AT-RISK YOUTH

19 SEC. 245. USES OF FUNDS FOR AT-RISK YOUTH.

20 (a) GENERAL AUTHORITY.—Each local workforce de21 velopment board that receives a subgrant under this chap22 ter shall use funds provided under such grant to improve

23 youth development and career preparation programs.

24 (b) REQUIREMENTS FOR USES OF FUNDS.—Funds

25 provided by a State pursuant to section 212(1)(B) shall
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1 be used to provide youth development and career prepara2 tion programs for at-risk youth that—

3 (1) are of such size, scope, and quality as to be

4 effective;

5 (2) integrate academic, vocational, and work6 based learning, stressing applied and contextual

7 learning, through a coherent sequence of courses so

8 that in-school and at-risk youth achieve both aca9 demic and occupational competencies;

10 (3) involve employers in the design and imple11 mentation of programs;

12 (4) establish effective linkages with in-school

13 youth programs, and secondary and postsecondary

14 education;

15 (5) provide work-based learning experiences, in16 cluding experiences in the practical arts or trade, if

17 applicable;

18 (6) provide adult mentoring as a core compo19 nent of the program;

20 (7) provide an objective assessment of the aca21 demic level, skill level, and service needs of each par22 ticipant; and

23 (8) provide comprehensive career guidance and

24 counseling.
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1 (c) ADDITIONAL USES OF FUNDS.—In carrying out

2 the provisions of subsection (b), providers of at-risk youth

3 programs, as selected by the local workforce development

4 board, may provide activities such as—

5 (1) tutoring, study skills training and instruc6 tion leading to completion of high school;

7 (2) alternative high school services;

8 (3) training or education that is combined with

9 community service, and service learning opportuni10 ties;

11 (4) paid and unpaid work experience, including

12 limited internships, entry-employment experience

13 programs, and summer employment opportunities,

14 that are integrated with year-round, school-based, or

15 alternative school-based programs;

16 (5) dropout prevention strategies, strategies to

17 encourage at-risk youth to reenter high school or al18 ternative high school programs, and programs that

19 encourage pregnant and parenting youth to stay in

20 school;

21 (6) preemployment and work maturity skills

22 training;

23 (7) peer-centered activities encouraging respon24 sibility and other positive social behaviors during

25 non-school hours; and
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1 (8) training-related supportive services.

2 (d) LIMITATIONS ON USE OF FUNDS.—Not more

3 than 10 percent of the funds provided under this chapter

4 to a local workforce development board may be used for

5 administrative purposes.

6 SEC. 246. AT-RISK YOUTH PROVIDERS.

7 (a) ROLE OF LOCAL WORKFORCE DEVELOPMENT

8 BOARD.—A local workforce development board that re9 ceives funds under this chapter shall not operate pro10 grams, but shall contract with eligible providers of dem11 onstrated effectiveness, or with eligible providers utilizing

12 service methodologies with demonstrated effectiveness in

13 serving the youth development and career preparation

14 needs of at-risk youth, for the purpose of providing serv15 ices under this chapter.

16 (b) ELIGIBLE PROVIDERS.—For purposes of this

17 chapter, eligible providers may include—

18 (1) an ‘‘eligible institution’’ as defined under

19 section 202(7);

20 (2) a unit of local government;

21 (3) a private, nonprofit organization (including

22 community-based organizations);

23 (4) a private, for profit entity; or
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1 (5) other organizations or entities of dem2 onstrated effectiveness and approved by the local

3 workforce development board.

4 Subtitle D—National Programs

5 SEC. 251. RESEARCH ACTIVITIES.

6 (a) GENERAL AUTHORITY.—

7 (1) IN GENERAL.—In order to carry out the

8 purpose of this title, the Secretary may, directly or

9 through grants, contracts, or cooperative agree10 ments, carry out research, development, dissemina11 tion, replication of model programs, demonstration

12 programs, evaluation, capacity-building, and tech13 nical assistance activities with regard to the services

14 and activities carried out under this title.

15 (2) INFORMATION SYSTEMS.—Activities carried

16 out under this section may include support for occu17 pational and career information systems.

18 (b) DISSEMINATION.—The Secretary shall establish

19 a system for disseminating information resulting from re20 search and development activities carried out under this

21 title.
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1 SEC. 252. ASSESSMENT AND DATA COLLECTION OF YOUTH

2 DEVELOPMENT AND CAREER PREPARATION

3 PROGRAMS.

4 (a) IN GENERAL.—The Secretary, through the Office

5 of Educational Research and Improvement, shall conduct

6 a biennial assessment of services and activities assisted

7 under this title, through studies and analyses conducted

8 independently through competitive awards.

9 (b) CONTENTS.—The assessment required under sub10 section (a) shall examine the extent to which services and

11 activities assisted under this title have achieved their in12 tended purposes and results, including the extent to

13 which—

14 (1) State and local services and activities have

15 developed, implemented, or improved youth develop16 ment and career preparation systems established

17 under this title;

18 (2) services and activities assisted under this

19 title succeed in preparing youth, including youth

20 who are members of special populations, for post21 secondary education, further learning, or entry into

22 high-skill, high-wage careers;

23 (3) youth who participate in services and activi24 ties supported under this title succeed in meeting

25 challenging State academic and industry-based skill

26 standards; and
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1 (4) the system improvement, participation, local

2 and State assessment, and accountability provisions

3 of this title, including the performance goals and in4 dicators established under section 110(f)(3), are ef5 fective.

6 SEC. 253. NATIONAL CENTER OR CENTERS FOR RESEARCH.

7 (a) GENERAL AUTHORITY.—

8 (1) NATIONAL CENTER.—The Secretary may,

9 through a grant or contract, establish one or more

10 national centers for conducting applied research, de11 velopment, dissemination, and technical assistance

12 activities which would focus on improving the devel13 opment and career preparation of youth. The Sec14 retary shall consult with States prior to establishing

15 one or more such centers.

16 (2) ELIGIBILITY.—Entities eligible to receive

17 funds under this section are institutions of higher

18 education, other public or private nonprofit organi19 zations or agencies, and consortia of such institu20 tions, organizations, or agencies.

21 (3) PREVIOUS CENTER.—The national center in

22 existence on the day before the date of the enact23 ment of the this Act shall continue to receive assist24 ance under this section in accordance with the terms

25 of its current award.
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1 (b) ACTIVITIES.—

2 (1) IN GENERAL.—The applied research, devel3 opment, dissemination, and technical assistance ac4 tivities carried out by the national center or centers

5 shall include—

6 (A) activities that assist recipients of funds

7 under this title to meet the requirements of sec8 tion 110(f)(3);

9 (B) research and development of activities

10 that combine academic, vocational-technical

11 education, and work-based learning;

12 (C) developing new models for remediation

13 of basic academic skills which incorporate ap14 propriate instructional methods;

15 (D) identifying ways to establish effective

16 linkages among educational and job training ac17 tivities at the State and local levels;

18 (E) new models for comprehensive career

19 guidance and counseling;

20 (F) studies providing longitudinal informa21 tion or formative evaluation on programs fund22 ed under this title, including an analysis of the

23 effectiveness of youth development and career

24 preparation programs in serving at-risk youth;

25 and
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1 (G) such other activities as the Secretary

2 determines to be appropriate to achieve the pur3 poses of this Act.

4 (2) DUTIES.—The center or centers shall—

5 (A) provide assistance to States and local

6 recipients in developing and using systems of

7 performance measures and indicators for im8 provement of youth development and career

9 preparation programs and services; and

10 (B) provide technical assistance and out11 reach.

12 (3) SUMMARY.—The center or centers conduct13 ing the activities described in paragraph (1) shall

14 annually prepare a summary of key research find15 ings of such center or centers and shall submit cop16 ies of the summary to the Secretaries of Education

17 and Labor. The Secretary shall submit that sum18 mary to the Committee on Labor and Human Re19 sources of the Senate, and the Committee on Eco20 nomic and Educational Opportunities of the House

21 of Representatives.

22 (c) CLEARINGHOUSE.—The center or centers shall

23 maintain a clearinghouse that will provide data and infor24 mation to Federal, State, and local organizations and

25 agencies about the condition of youth development and ca-
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1 reer preparation systems and programs funded under this

2 title.

3 TITLE III—ADULT EMPLOYMENT

4 AND TRAINING CONSOLIDA5 TION GRANT

6 SEC. 301. PURPOSE.

7 The purpose of this title is to establish an efficient,

8 high-quality, and equitable system of employment, job

9 training, and related assistance designed to facilitate the

10 transition of adults into productive, high skills, private

11 sector employment.

12 Subtitle A—Adult Employment and

13 Training Consolidation Grant

14 SEC. 311. AUTHORIZATION.

15 (a) IN GENERAL.—In the case of each State that in

16 accordance with the requirements of section 102 submits

17 to the Secretary of Labor (hereinafter in this title referred

18 to as the ‘‘Secretary’’) a State workforce development and

19 literacy plan under section 104, the Secretary shall pro20 vide a grant to the State for the purpose of providing em21 ployment, job training, and related assistance for adults

22 in the State.

23 (b) AMOUNT.—The grant shall consist of the allot24 ment determined for the State under section 312.
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1 SEC. 312. ALLOTMENT AMONG STATES.

2 (a) IN GENERAL.—Of the amount appropriated pur3 suant to section 4(a)(2) to carry out this title for a fiscal

4 year, the Secretary shall—

5 (1) allot 85 percent of such amounts in accord6 ance with subsection (b); and

7 (2) reserve 15 percent for use under subtitle B.

8 (b) ALLOTMENT AMONG STATES.—

9 (1) RESERVATION FOR THE TERRITORIES.—Of

10 the amount allotted under subsection (a)(1), the

11 Secretary shall allot not more than one quarter of

12 one percent among the Commonwealth of the North13 ern Mariana Islands, American Samoa, Guam, and

14 the Virgin Islands.

15 (2) STATES.—After determining the amount to

16 be allotted under paragraph (1), the Secretary shall

17 allot the remaining amount to the remaining States

18 so that each State receives an amount that bears the

19 same proportion to such remaining amount as—

20 (A) the amount allotted to each such State

21 from allotments under sections 202 and 302 of

22 the Job Training Partnership Act (29 U.S.C.

23 1602 and 1652) (as in effect before the date of

24 the enactment of this Act) for fiscal year 1995;

25 bears to
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1 (B) the aggregate of the amounts allotted

2 to all such States from allotments under such

3 sections for such fiscal year.

4 (c) MINIMUM ALLOTMENT.—No State shall receive

5 less than one-quarter of one percent of the amount avail6 able under this title for a fiscal year. Amounts necessary

7 for increasing such payments to States to comply with the

8 preceding sentence shall be obtained by ratably reducing

9 the amounts to be paid to other States.

10 SEC. 313. ALLOCATION WITHIN STATES.

11 (a) RESERVATIONS FOR STATE ACTIVITIES.—

12 (1) IN GENERAL.—The Governor of the State

13 shall reserve not more than 20 percent of the

14 amount allotted to the State under section 312(b)

15 for a fiscal year for statewide activities for employ16 ment, job training, and related assistance for adults.

17 (2) MANDATORY ACTIVITIES.—Such activities

18 shall include—

19 (A) rapid response activities; and

20 (B) additional assistance to areas that ex21 perience disasters, mass layoffs or plant clos22 ings, or other events which precipitate substan23 tial increases in the number of unemployed

24 workers, to be expended in accordance with the
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1 local plan of the relevant workforce development

2 area.

3 (3) DISCRETIONARY ACTIVITIES.—

4 (A) IN GENERAL.—Such activities may in5 clude—

6 (i) subject to subparagraph (B), ad7 ministration by the State of programs

8 under this subtitle;

9 (ii) capacity building and technical as10 sistance to local workforce development

11 areas, integrated career center systems,

12 and service providers, including the devel13 opment and training of staff and the devel14 opment of exemplary program activities;

15 (iii) incentives for program coordina16 tion, performance awards, and research

17 and demonstrations;

18 (iv) implementation of innovative in19 cumbent worker training programs, which

20 may include the establishment and imple21 mentation of an employer loan program to

22 assist in skills upgrading (in accordance

23 with the requirements of section 324);

24 (v) implementation of experimen25 tation, model activities, pilot projects, and
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1 demonstration projects which further the

2 goals and purposes of this Act;

3 (vi) additional assistance for the de4 velopment and implementation of the inte5 grated career center system of the State

6 established in accordance with title I; and

7 (vii) support for a common manage8 ment information system as described in

9 section 109.

10 (B) LIMITATION.—Not more than 25 per11 cent of the amount reserved by the Governor

12 under paragraph (1) may be used for adminis13 tration by the State of programs under this

14 subtitle.

15 (b) WITHIN STATE ALLOCATION.—

16 (1) IN GENERAL.—The Governor of the State

17 shall allocate the remainder of the amount allotted

18 to the State under section 312(b) to workforce devel19 opment areas designated under title I of this Act, in

20 accordance with paragraphs (1) and (2) of such sec21 tion, for the purpose of providing employment, job

22 training, and related services for adults in accord23 ance with section 315.

24 (2) WITHIN STATE FORMULA.—
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1 (A) ESTABLISHMENT.—The Governor,

2 through the collaborative process under section

3 103 of this Act, and after consultation with

4 local chief elected officials in the local workforce

5 development area, shall develop a formula for

6 the allocation of 90 percent of the remainder of

7 funds described in paragraph (1), to workforce

8 development areas, taking into account—

9 (i) poverty rates within each local

10 workforce development area, as determined

11 by the State;

12 (ii) unemployment rates within each

13 local workforce development area;

14 (iii) the proportion of the State’s

15 adult population residing within each local

16 workforce development area; and

17 (iv) such other factors as considered

18 appropriate.

19 (B) ADDITIONAL FACTORS.—In establish20 ing such formula, the Governor shall ensure

21 that funds are distributed equitably throughout

22 the State, and that the factors described in sub23 paragraph (A) do not receive disproportionate

24 weighting.
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1 (3) WITHIN STATE DISCRETIONARY ALLOCA2 TION.—In addition, the Governor is authorized to al3 locate 10 percent of the remainder of funds de4 scribed in paragraph (1) to workforce development

5 areas designated under title I of this Act. Amounts

6 may be allocated to such areas as determined by the

7 Governor.

8 SEC. 314. ADDITIONAL STATE PLAN REQUIREMENTS.

9 The State shall, as part of the State workforce devel10 opment and literacy plan under title I of this Act, submit

11 to the Secretary the following additional information:

12 (1) A description of how the State will serve the

13 employment and training needs of dislocated work14 ers, economically disadvantaged individuals, older

15 workers, individuals with disabilities, displaced

16 homemakers, veterans, and individuals with multiple

17 barriers to employment (as determined by the

18 State), including individuals who are basic skills de19 ficient.

20 (2) A description of how the State will provide

21 rapid response assistance to workers experiencing

22 dislocation as a result of mass layoffs and plant clos23 ings, either through the direct provision of services

24 or through the transfer of funds to local workforce

25 development areas for the provision of such services.
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1 SEC. 315. USE OF AMOUNTS.

2 (a) CORE SERVICES.—Amounts allocated under sec3 tion 313(b) shall be used to provide core services to adults

4 through integrated career center systems in accordance

5 with title I of this Act.

6 (b) INTENSIVE SERVICES.—

7 (1) IN GENERAL.—Amounts allocated under

8 section 313(b) shall be used to provide intensive

9 services to adults—

10 (A) who are unable to obtain employment

11 through core services under subsection (a); and

12 (B) who have been determined to be in

13 need of more intensive services in order to gain

14 employment.

15 (2) DELIVERY OF SERVICES.—Such intensive

16 services shall be provided—

17 (A) directly through integrated career cen18 ter systems in accordance with title I of this

19 Act; or

20 (B) through contracts through such sys21 tems with service providers approved by the

22 local workforce development board, which may

23 include private, for-profit providers.

24 (3) TYPES OF SERVICES.—Such intensive serv25 ices may include the following:
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1 (A) Comprehensive and specialized assess2 ments of the skill levels and service needs of

3 adults, which may include—

4 (i) diagnostic testing and other assess5 ment tools; and

6 (ii) in-depth interviewing and evalua7 tion to identify employment barriers and

8 appropriate employment goals.

9 (B) Development of an individual employ10 ment plan, to identify the employment goals,

11 appropriate achievement objectives, and the ap12 propriate combination of services for the adult

13 to achieve the employment goal.

14 (C) Group counseling.

15 (D) Individual counseling and career plan16 ning.

17 (E) Case management for adults receiving

18 education and training services under sub19 section (c) or supportive services under sub20 section (d).

21 (F) Follow-up counseling for adults placed

22 in training or employment, for up to 1 year.

23 (c) EDUCATION AND TRAINING SERVICES.—
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1 (1) IN GENERAL.—Amounts allocated under

2 section 313(b) shall be used to provide education

3 and training services to adults—

4 (A) who are unable to obtain employment

5 through core services under subsection (a);

6 (B) who are in need of education and

7 training services in order to gain employment

8 as a result of determinations made through—

9 (i) preliminary assessments under sec10 tion 107(f)(1)(B) of this Act; or

11 (ii) comprehensive and specialized as12 sessments under subsection (b)(3)(A); and

13 (C) who are unable to obtain other grant

14 assistance for such services, such as through

15 Federal Pell Grants established under title IV

16 of the Higher Education Act of 1965.

17 (2) DELIVERY OF SERVICES.—Such education

18 and training services shall be provided through edu19 cation and training providers certified in accordance

20 with title I of this Act.

21 (3) TYPES OF SERVICES.—Such education and

22 training services may include the following:

23 (A) Basic skills training, including reme24 dial education, literacy training, and English

25 literacy program instruction.
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1 (B) Occupational skills training, including

2 training for nontraditional employment.

3 (C) On-the-job training.

4 (D) Programs that combine workplace

5 training with related instruction.

6 (E) Training programs operated by the

7 private sector.

8 (F) Skill upgrading and retraining.

9 (G) Entrepreneurial training.

10 (H) Employability training to enhance

11 basic workplace competencies.

12 (I) Customized training conducted with a

13 commitment by an employer or group of em14 ployers to employ an individual upon successful

15 completion of the training.

16 (4) ADDITIONAL REQUIREMENTS.—

17 (A) USE OF CAREER GRANTS.—

18 (i) IN GENERAL.—Except as provided

19 in clause (ii) and clause (iii), education

20 and training services under this section

21 shall be provided through the use of career

22 grants in accordance with this subsection,

23 and shall be distributed to eligible individ24 uals through integrated career centers or

25 affiliated sites as described in section 107,
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1 and in accordance with section 108 regard2 ing the identification of eligible education

3 and training providers.

4 (ii) EXCEPTIONS.—Education and

5 training services authorized under this title

6 may be provided pursuant to a contract for

7 services in lieu of a career grant if—

8 (I) such services are on-the-job

9 training provided by an employer;

10 (II) the local workforce develop11 ment board determines there are an

12 insufficient number of certified pro13 viders of education and training serv14 ices in the workforce development

15 area to accomplish the purposes of a

16 career grant system;

17 (III) the local workforce develop18 ment board determines that the cer19 tified providers of education and

20 training in the workforce development

21 area are unable to provide effective

22 services to special participant popu23 lations; or

24 (IV) the local workforce develop25 ment board decides to enter into a di-
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1 rect training contract with a commu2 nity based organization serving special

3 participant populations.

4 (iii) TRANSITION.—States may have

5 up to three years from the date of enact6 ment of this Act to fully implement the re7 quirements of clause (i), but nothing shall

8 prohibit states from beginning such imple9 mentation at an earlier date.

10 (B) LINKAGE TO OCCUPATIONS IN DE11 MAND.—Education and training services under

12 this subsection shall be directly linked to occu13 pations for which there is a demand in the local

14 workforce development area, or in another area

15 to which an adult receiving such services is will16 ing to relocate.

17 (d) ADDITIONAL SERVICES.—

18 (1) SUPPORTIVE SERVICES.—Supportive serv19 ices may be provided for individuals—

20 (A) who are receiving assistance under any

21 of subsections (a) through (c); and

22 (B) who are unable to receive such services

23 through other programs providing such services.

24 (2) NEEDS-RELATED PAYMENTS.—
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1 (A) IN GENERAL.—Amounts allocated

2 under section 313(b) may be used to provide

3 needs-related payments to adults who are un4 employed and do not qualify for (or have ceased

5 to qualify for) unemployment compensation for

6 the purpose of enabling such adults to partici7 pate in education and training programs under

8 subsection (c).

9 (B) ADDITIONAL ELIGIBILITY REQUIRE10 MENTS.—In addition to the requirements con11 tained in subparagraph (A), a dislocated worker

12 who has exhausted unemployment insurance

13 benefits may be eligible to receive needs-related

14 payments under this paragraph only if such

15 worker was enrolled in education or training by

16 the end of the 8th week of the worker’s initial

17 unemployment compensation benefit period, or,

18 if later, by the end of the 8th week after the

19 worker is informed that a short-term layoff will

20 in fact exceed 6 months.

21 (e) PRIORITY.—Local workforce development boards

22 shall establish a process through which priority is given

23 to dislocated workers and economically disadvantaged in24 dividuals, for receipt of services provided under sub-
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1 sections (b) and (c), in the event that funds are limited

2 within the workforce development area.

3 (f) PROHIBITION ON PRIVATE RIGHT OF ACTION.—

4 Nothing in this section may be construed to establish a

5 right for a participant to bring an action to obtain services

6 under a program established under this section.

7 (g) LIMITATIONS ON USE OF FUNDS.—Not more

8 than 10 percent of the funds provided under this title to

9 a local workforce development board may be used for ad10 ministrative purposes.

11 Subtitle B—Federal Programs

12 SEC. 321. NATIONAL DISCRETIONARY GRANTS.

13 (a) GRANTS FOR DISLOCATED WORKERS.—

14 (1) IN GENERAL.—From amounts reserved

15 under section 312(a)(2) for any fiscal year, the Sec16 retary is authorized to award national discretionary

17 grants to address major economic dislocations that

18 result from plant closures, base closures, or mass

19 layoffs.

20 (2) APPLICATION.—To receive a grant under

21 this section, an eligible entity shall submit an appli22 cation to the Secretary at such time, in such man23 ner, and accompanied by such information as the

24 Secretary determines is appropriate.
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1 (3) ELIGIBLE ENTITIES.—Grants under this

2 section may be awarded to—

3 (A) the State;

4 (B) a local workforce development board

5 administering assistance under this Act;

6 (C) employers and employer associations;

7 (D) worker-management transition assist8 ance committees and other employer-employee

9 entities;

10 (E) representatives of employees;

11 (F) community development corporations

12 and community-based organizations; and

13 (G) industry consortia.

14 (b) INCENTIVE GRANTS.—From amounts reserved

15 under section 312(a)(2) for any fiscal year, the Secretary

16 may provide awards to States—

17 (1) to assist in the implementation of exemplary

18 statewide workforce development system designs;

19 and

20 (2) for the achievement of exceptional perform21 ance in the statewide workforce development system.

22 SEC. 322. DISASTER RELIEF EMPLOYMENT ASSISTANCE.

23 (a) IN GENERAL.—From amounts reserved under

24 section 312(a)(2) for any fiscal year, the Secretary may

25 provide assistance to the Governor of any State within
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1 which is located an area that has suffered an emergency

2 or a major disaster as defined in paragraphs (1) and (2),

3 respectively, of section 102 of the Robert T. Stafford Dis4 aster Relief and Emergency Assistance Act (referred to

5 in this section as the ‘‘disaster area’’).

6 (b) USE OF FUNDS.—

7 (1) PROJECTS RESTRICTED TO DISASTER

8 AREAS.—Funds made available under this section—

9 (A) shall be used exclusively to provide em10 ployment on projects to provide food, clothing,

11 shelter, and other humanitarian assistance for

12 disaster victims and on projects regarding dem13 olition, cleanup, repair, renovation, and recon14 struction of damaged and destroyed structures,

15 facilities, and lands located within the disaster

16 area; and

17 (B) may be expended through public and

18 private agencies and organizations engaged in

19 such projects.

20 (2) ELIGIBILITY REQUIREMENTS.—An individ21 ual shall be eligible to be offered disaster employ22 ment under this section if such individual is a dis23 located worker or is temporarily or permanently laid

24 off as a consequence of the disaster.
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1 (3) LIMITATIONS ON DISASTER RELIEF EM2 PLOYMENT.—No individual shall be employed under

3 this part for more than 6 months for work related

4 to recovery from a single natural disaster.

5 SEC. 323. RESEARCH, DEMONSTRATION, EVALUATION, AND

6 CAPACITY BUILDING.

7 (a) IN GENERAL.—From amounts reserved under

8 section 312(a)(2) for any fiscal year, the Secretary is au9 thorized to establish and carry out research, demonstra10 tion, and capacity building activities in accordance with

11 this section.

12 (b) ACTIVITIES.—The Secretary is authorized to

13 carry out the following activities under this section:

14 (1) RESEARCH.—The Secretary is authorized to

15 conduct continuing research, which may include

16 studies and other methods and techniques, that will

17 aid in the solution of the employment and training

18 problems of the United States. Such studies may in19 clude the extent to which individuals who participate

20 in programs established under this title achieve self21 sufficiency as a result of such participation, includ22 ing the identification by State and locality, to the ex23 tent practicable, of indicators measuring such self24 sufficiency.
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1 (2) DEMONSTRATIONS.—The Secretary is au2 thorized to conduct pilot and demonstration projects

3 for the purpose of developing and improving meth4 ods and techniques for addressing employment and

5 training needs which may include—

6 (A) projects conducted jointly with the De7 partment of Defense to develop training pro8 grams utilizing computer-based and other inno9 vative learning technologies. The Secretary may

10 award grants and enter into contracts with ap11 propriate entities to carry out such projects;

12 and

13 (B) Projects which promote the use of dis14 tance learning, enabling students to take

15 courses through the use of technology such as

16 videos teleconferencing, computers, and the

17 internet.

18 (3) EVALUATION.—

19 (A) ACTIVITIES.—

20 (i) JOB TRAINING ACTIVITIES.—The

21 Secretary shall provide for the continuing

22 evaluation of activities conducted under

23 this Act, including the use of controlled ex24 periments using experimental and control

25 groups chosen by scientific random assign-
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1 ment, and at a minimum, determine

2 whether job training and job placement

3 programs effectively raise the hourly wage

4 rates of individuals receiving training

5 through such programs.

6 (ii) OTHER PROGRAMS.—The Sec7 retary may conduct evaluations of other

8 federally funded employment-related activi9 ties including programs administered

10 under—

11 (I) the Wagner-Peyser Act (29

12 U.S.C. 49 et seq.);

13 (II) the National Apprenticeship

14 Act (29 U.S.C. 50 et seq.);

15 (III) the Older Americans Act of

16 1965 (42 U.S.C. 3001 et seq.); and

17 (IV) the Federal unemployment

18 insurance program under titles III,

19 IX, and XII of the Social Security Act

20 (42 U.S.C. 501 et seq., 1101 et seq.,

21 and 1321 et seq.).

22 (B) EFFECTIVENESS.—The Secretary shall

23 evaluate the effectiveness of programs author24 ized under this Act with respect to—

25 (i) the statutory goals;
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1 (ii) the performance standards estab2 lished by the Secretary; and

3 (iii) the extent to which such pro4 grams enhance the employment and earn5 ings of participants, reduce income support

6 costs, improve the employment com7 petencies of participants in comparison to

8 comparable persons who did not partici9 pate in such programs, and to the extent

10 feasible, increase the level of total employ11 ment over the level that would have existed

12 in the absence of such programs.

13 (4) NATIONAL PARTNERSHIP AND SPECIAL

14 TRAINING.—The Secretary may award special grants

15 to eligible entities to carry out activities that are

16 most appropriately administered at the national

17 level. Such activities may include—

18 (A) partnerships with national organiza19 tions with special expertise in developing, orga20 nizing, and administering employment and

21 training services at the national, State, and

22 local levels, such as industry and labor associa23 tions, public interests groups, community-based

24 organizations representative of groups that en-
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1 counter special difficulties in the labor market,

2 in education and training; and

3 (B) activities that—

4 (i) address industry-wide skill short5 ages;

6 (ii) meet training needs that are best

7 addressed on a multistate basis;

8 (iii) further the goals of increasing the

9 competitiveness of the United States labor

10 force;

11 (iv) require technical expertise avail12 able at the national level to serve the needs

13 of particular client groups that encounter

14 significant barriers to employment and who

15 the Secretary determines require special

16 assistance; and

17 (v) promote and experiment with

18 model activities, pilot projects, and dem19 onstration projects which further the goals

20 and purposes of this Act.

21 (5) CAPACITY BUILDING AND TECHNICAL AS22 SISTANCE.—

23 (A) IN GENERAL.—The Secretary shall

24 provide, through grants, contracts, or other ar25 rangements, staff training and technical assist-
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1 ance to States, local workforce development

2 boards, career centers, communities, business

3 and labor organizations, service providers, in4 dustry consortia, and other entities, to enhance

5 their capacity to develop and deliver effective

6 employment and training services.

7 (B) ACTIVITIES.—The staff training and

8 technical assistance authorized under subpara9 graph (A) may include—

10 (i) development of management infor11 mation systems;

12 (ii) development and maintenance of a

13 national capacity building, information and

14 dissemination network; and

15 (iii) grants for the replication of suc16 cessful employment and training models

17 and activities.

18 SEC. 324. WORKFORCE SKILLS AND DEVELOPMENT LOANS.

19 (a) AUTHORIZATION.—

20 (1) IN GENERAL.—From amounts reserved

21 under section 312(a)(2) for any fiscal year, the Sec22 retary of Labor may use a portion of such amounts

23 to provide grants to States to provide loans to eligi24 ble entities described in paragraph (2) to assist such

25 entities in providing skills upgrading.
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1 (2) ELIGIBLE ENTITIES.—An eligible entity de2 scribed in this paragraph is—

3 (A) an employer;

4 (B) a representative of employees;

5 (C) a business association;

6 (D) a trade organization; or

7 (E) a consortium consisting of—

8 (i) more than 1 of the entities de9 scribed in subparagraphs (A) through (D);

10 or

11 (ii) an institution of higher education

12 (as such term is defined in section 481 of

13 the Higher Education Act of 1965 (20

14 U.S.C. 1088) which continues to meet the

15 eligibility and certification requirements

16 under section 498 of such Act) and 1 or

17 more of the entities described in subpara18 graphs (A) through (D).

19 (b) APPLICATION.—The Secretary may provide a

20 grant to a State under subsection (a) only if such State

21 submits to the Secretary an application which contains

22 such information as the Secretary may reasonably require.

23 (c) USE OF AMOUNTS.—A State shall use amounts

24 received from a grant under subsection (a) to establish

25 a loan guarantee program to assist eligible entities de-
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1 scribed in paragraph (2) of such subsection to provide

2 skills upgrading. In carrying out such program, the State

3 shall meet the following requirements:

4 (1) ESTABLISHMENT OF RESERVE FUND FOR

5 LOAN GUARANTEES.—The State shall establish a re6 serve fund from amounts received from such grant

7 for the purpose of making commitments to guaran8 tee the payment of principal and interest on loans

9 made by financial institutions to such eligible enti10 ties to provide skills upgrading.

11 (2) CRITERIA FOR LOAN GUARANTEES.—The

12 State, in conjunction with appropriate financial in13 stitutions, shall establish and publish criteria for

14 providing loan guarantees to eligible entities under

15 the program, including criteria that provides for the

16 following:

17 (A) A loan guarantee may be issued under

18 the program only if, at the time such guarantee

19 is issued the eligible entity agrees to pay as an

20 insurance premium an amount equal to 1 per21 cent of the principal received by such entity

22 under the loan to the State’s reserve fund.

23 (B)(i) Subject to clause (ii), the eligible en24 tity will use amounts received from the loan to
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1 provide skills upgrading for mid- and lower-level

2 employees, which may include—

3 (I) training in total quality manage4 ment, statistical process control, produc5 tion techniques, office automation, mate6 rials resource planning; and

7 (II) training to improve basic skills,

8 including reading, writing, and arithmetic.

9 (ii) In providing such skills upgrading, the

10 eligible entity shall give priority to employees

11 who—

12 (I) directly produce or deliver goods

13 or services; or

14 (II) are in danger of being terminated

15 or laid off as a result of modernization in

16 the workplace, corporate downsizing, for17 eign or domestic competition, or Federal

18 policies adversely affecting 1 or more in19 dustries.

20 (C) Amounts from a loan shall not be used

21 to pay the wages or other benefits of any em22 ployee receiving assistance under the program.

23 (3) PAYMENT BY STATE TO FINANCIAL INSTI24 TUTIONS IN CASES OF DEFAULT.—
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1 (A) IN GENERAL.—In accordance with cri2 teria developed by the Secretary, the State shall

3 make payments from the State’s reserve fund to

4 financial institutions that have provided loans

5 to eligible entities that have defaulted on such

6 loans for the purpose of reimbursing such insti7 tutions for the amount of principal and interest

8 remaining unpaid to the institutions by reason

9 of such default.

10 (B) NO FULL FAITH AND CREDIT OF THE

11 UNITED STATES.—Loans provided by financial

12 institutions to eligible entities under loan guar13 antee programs under this section shall not be

14 obligations of, or guaranteed in any respect by,

15 the United States.

16 (4) INTEREST FROM AMOUNTS IN RESERVE

17 FUND.—Any interest earned from amounts in the

18 State’s reserve fund shall be credited to such fund.

19 (d) FEDERAL AND STATE SHARE.—

20 (1) FEDERAL SHARE.—The Federal share

21 under this section may not exceed 50 percent of the

22 total cost of the program established under sub23 section (c) for any fiscal year.
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1 (2) STATE SHARE.—The State share shall be

2 provided from non-Federal sources and may be in

3 cash or in-kind, fairly evaluated.

4 SEC. 325. EMPLOYMENT, TRAINING, AND EDUCATION AS5 SISTANCE FOR NATIVE AMERICANS.

6 (a) AUTHORIZATION.—From amounts reserved under

7 section 4(a)(2) for any fiscal year, there shall be reserved

8 one quarter of one percent, or $85,000,000, whichever is

9 less, to provide grants to, or enter into contracts or coop10 erative agreements with, Indian tribes and tribal organiza11 tions, tribally-controlled colleges, tribally-controlled post12 secondary vocational institutions, Indian-controlled orga13 nizations serving off-reservation areas, Alaska Native vil14 lage and regional entities serving areas as described in the

15 Alaska Native Claims Settlement Act and Hawaiian Na16 tive-controlled organizations to provide employment, train17 ing, vocational rehabilitation, library services, and edu18 cation assistance for Native Americans.

19 (b) TRANSFER OF AUTHORITY FOR VOCATIONAL

20 EDUCATION ACTIVITIES.—In carrying out subsection (a),

21 the Secretary of Labor may enter into an agreement with

22 the Secretary of Education to carry out any portion of

23 assistance under such subsection devoted to vocational

24 educational activities, including support for the United
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1 Tribes Technical College and Crownpoint Institute of

2 Technology.

3 (c) CONSOLIDATION OF FUNDS.—Entities receiving

4 assistance under subsection (a) may consolidate such as5 sistance with assistance received from related programs in

6 accordance with the provisions of the Indian Employment,

7 Training and Related Services Demonstration Act (Public

8 Law 102–477).

9 (d) REGULATIONS.—The Secretary shall consult with

10 Indian, Alaska Native and Hawaiian Native groups in es11 tablishing regulations to carry out this section, including

12 performance standards for entities receiving assistance

13 under subsection (a), taking into account the economic cir14 cumstances of such groups.

15 SEC. 326. EMPLOYMENT, TRAINING, AND EDUCATION AS16 SISTANCE FOR MIGRANT AND SEASONAL

17 FARMWORKERS.

18 (a) AUTHORIZATION.—

19 (1) IN GENERAL.—From amounts reserved

20 under section 4(a)(2) for any fiscal year, there shall

21 be reserved one quarter of one percent, or

22 $85,000,000, whichever is less, to provide grants to,

23 or enter into contracts or cooperative agreements

24 with, entities described in paragraph (2) to provide
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1 employment, training, and education assistance for

2 migrant and seasonal farmworkers.

3 (2) ENTITIES DESCRIBED.—An entity described

4 in this paragraph is an entity the Secretary deter5 mines to have the capacity to administer effectively

6 a diversified workforce development program for mi7 grant and seasonal farmworkers.

8 (b) USE OF AMOUNTS.—An entity shall use amounts

9 received under subsection (a) to provide employment,

10 training, educational development, high school equiva11 lency, postsecondary education assistance, vocational reha12 bilitation, literacy, English as a second language, work13 based education and development, worker safety training,

14 employability enhancements, emergency or other disaster

15 relief, housing, technical assistance, outreach, intake, as16 sessment, follow-up, stipend support, supportive services,

17 other needs-based assistance, self-employment and related

18 business enterprise development education, and the man19 agement of a database on participating migrant and sea20 sonal farmworkers.

21 (c) REGULATIONS.—The Secretary shall consult with

22 seasonal and migrant farmworker groups in establishing

23 regulations to carry out this section, including perform24 ance standards for entities receiving assistance under sub-
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1 section (a)(2), taking into account the economic cir2 cumstances of such groups.

3 TITLE IV—ADULT EDUCATION

4 AND FAMILY LITERACY CON5 SOLIDATION GRANT AND LI6 BRARY SERVICES AND TECH7 NOLOGY CONSOLIDATION

8 GRANT

9 SEC. 401. FINDINGS.

10 The Congress finds as follows:

11 (1) According to the 1990 census, 21 percent of

12 our Nation’s adults (more than 38 million persons)

13 lack a high school credential or are limited English

14 proficient.

15 (2) The National Adult Literacy Survey, con16 ducted under the Adult Education Act, found that

17 20 percent of all adults in the United States, or

18 about 40 million people, have minimal levels of lit19 eracy skills and that the lack of such skills is related

20 to unemployment, low wages, and fewer weeks

21 worked.

22 (3) The success of State efforts to reform and

23 improve public education are dependent on the abil24 ity of the United States to break intergenerational

25 cycles of illiteracy and inadequate education by en-
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1 suring that parents possess a strong educational

2 foundation and, as the first and most continuous

3 teachers of their children, model for, and instill in,

4 their children a commitment to family literacy and

5 life-long learning.

6 (4) Generations of immigrants have contributed

7 to our communities and our economy, but for them

8 to continue to do so given recent technologies and

9 the competitive global economy, they must master

10 English as rapidly as possible.

11 (5) Studies have found that incarcerated adults

12 are twice as likely as nonincarcerated adults to lack

13 a good education and that such lack is a significant

14 statistical indicator of recidivism.

15 (6) Certain short-term and long-term goals of

16 the Nation may not be met unless the United States

17 improves its current system of adult education and

18 life-long learning through Federal leadership.

19 SEC. 402. DEFINITIONS.

20 As used in this title:

21 (1) CORRECTIONAL EDUCATION AGENCY.—The

22 term ‘‘correctional education agency’’ means an en23 tity that provides programs for criminal offenders in

24 corrections institutions and for other institutional25 ized individuals which include academic programs
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1 for basic education, special education, bilingual or

2 English language instruction, vocational training, li3 brary development, corrections education programs,

4 guidance and counseling, and other supportive serv5 ices for criminal offenders which may emphasize co6 ordination of educational services with educational

7 institutions, community-based organizations of de8 monstrative effectiveness, and the private sector, de9 signed to provide education and training.

10 (2) EDUCATIONALLY DISADVANTAGED

11 ADULT.—The term ‘‘educationally disadvantaged

12 adult’’ means an adult who—

13 (A) demonstrates basic skills equivalent to

14 or below that of students at the fifth grade

15 level; or

16 (B) has been placed in the lowest or begin17 ning level of an adult education program when

18 that program does not use grade level equiva19 lencies as a measure of students’ basic skills.

20 (3) FAMILY LITERACY SERVICES.—The term

21 ‘‘family literacy services’’ means services that are of

22 sufficient intensity in terms of hours, and of suffi23 cient duration, to make sustainable changes in a

24 family and that integrate all of the following activi25 ties:
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1 (A) Interactive literacy activities between

2 parents and their children.

3 (B) Training for parents on how to be

4 their children’s primary teacher and full part5 ners in the education of their children.

6 (C) Parent literacy training.

7 (D) An age-appropriate education program

8 for children.

9 (4) SECRETARY.—The term ‘‘Secretary’’ means

10 the Secretary of Education.

11 Subtitle A—Adult Education and

12 Family Literacy Consolidation

13 Grant

14 SEC. 411. PURPOSES.

15 The purposes of this subtitle are to assist States to

16 provide—

17 (1) to adults, the basic educational skills nec18 essary for employment and self-sufficiency;

19 (2) to adults who are parents, the educational

20 skills necessary to be full partners in the educational

21 development of their children;

22 (3) to adults, the basic English language skills

23 necessary to participate in the civic, social, and eco24 nomic life of the United States; and
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1 (4) to adults, the opportunity to attain a high

2 school degree or its equivalent in order to permit

3 them to pursue further education and training or

4 improve their family and work situations.

5 CHAPTER 1—FUNDING

6 SEC. 421. RESERVATIONS FROM AMOUNTS APPROPRIATED.

7 (a) NATIONAL INSTITUTE FOR LITERACY.—For any

8 fiscal year, the Secretary shall reserve $4,500,000 of the

9 amount appropriated under section 4(a)(3) to carry out

10 the activities of the National Institute for Literacy de11 scribed in section 441.

12 (b) NATIONAL LEADERSHIP ACTIVITIES.—For any

13 fiscal year, the Secretary shall reserve $4,500,000 of the

14 amount appropriated under section 4(a)(3) to establish

15 and carry out the program of national leadership and eval16 uation activities described in section 442.

17 SEC. 422. ALLOTMENT.

18 (a) INITIAL ALLOTMENT.—From the sums available

19 for the purpose of making grants under chapter 2 for any

20 fiscal year, the Secretary shall allot—

21 (1) $100,000 each to Guam, American Samoa,

22 the Commonwealth of the Northern Mariana Is23 lands, and the Virgin Islands; and

24 (2) $250,000 to each of the other States.

25 (b) ADDITIONAL ALLOTMENT.—
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1 (1) IN GENERAL.—From the remainder of the

2 sums described in subsection (a) after the applica3 tion of the subsection, the Secretary shall allot to

4 each State an amount which bears the same ratio to

5 such remainder as the number of qualifying adults

6 in the State bears to the number of such adults in

7 all States.

8 (2) QUALIFYING ADULT.—For purposes of this

9 subsection, the term ‘‘qualifying adult’’ means an

10 adult who—

11 (A) is at least 16 years of age, but less

12 than 61 years of age;

13 (B) is beyond the age of compulsory school

14 attendance under State law;

15 (C) does not have a certificate of gradua16 tion from a school providing secondary edu17 cation (or its equivalent); and

18 (D) is not currently enrolled in elementary

19 or secondary school.

20 CHAPTER 2—GRANTS TO STATES

21 SEC. 431. REQUIREMENT TO MAKE GRANTS.

22 For fiscal year 1997 and subsequent fiscal years, the

23 Secretary shall make a grant to a State in an amount

24 equal to the initial and additional allotments of the State

25 for the year if the State—
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1 (1) has satisfied the requirements of title I and

2 section 433(a)(1);

3 (2) agrees not to expend the grant for any pur4 pose other than in accordance with section 432;

5 (3) agrees to satisfy the grant requirements in

6 section 433(a)(2) and 433(b); and

7 (4) agrees not to expend the grant for the pur8 pose of supporting or providing programs, services,

9 or activities for individuals who are not adults, ex10 cept if such programs, services, or activities are re11 lated to family literacy services.

12 SEC. 432. USES OF FUNDS.

13 (a) STATE USES OF FUNDS.—

14 (1) GRANTS TO SERVE TARGET POPU15 LATIONS.—

16 (A) IN GENERAL.—Of the funds paid to a

17 State under this title for fiscal year 1998 and

18 subsequent fiscal years, 3 percent shall be dis19 tributed as performance grants made by the

20 State on a competitive basis, and consistent

21 with subsection (b) and section 433(b)(2), to

22 local service providers that have provided, dur23 ing the immediately preceding fiscal year, adult

24 education or family literacy services to the tar25 get populations described in subparagraph (C).
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1 (B) LOCAL SERVICE PROVIDERS.—The

2 local service providers referred to in subpara3 graph (A) may include the following:

4 (i) Local educational agencies.

5 (ii) Correctional educational agencies.

6 (iii) Community-based organizations.

7 (iv) Public or private nonprofit agen8 cies.

9 (v) Institutions of higher education.

10 (vi) Libraries.

11 (vii) Other institutions that the State

12 determines to have the ability to provide

13 literacy services to adults and families.

14 (C) TARGET POPULATIONS.—The target

15 populations referred to in subparagraph (A) are

16 the following:

17 (i) Adults with more than one barrier

18 to self-sufficiency, such as being unem19 ployed or an educationally disadvantaged

20 adult.

21 (ii) Families on public assistance (as

22 determined by the State).

23 (iii) Parents who are educationally

24 disadvantaged adults and who have a child

25 who is less than 8 years of age.
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1 (iv) Adults who are individuals with

2 disabilities or who have similar special

3 needs.

4 (2) GRANTS TO LOCAL SERVICE PROVIDERS.—

5 Of the funds paid to a State under this subtitle for

6 any fiscal year that remain after the application of

7 paragraph (1), at least 85 percent shall be distrib8 uted as grants made by the State on a competitive

9 basis, and consistent with subsection (b) and section

10 433(b)(2), to local service providers to establish,

11 conduct, or expand programs, services, or activities

12 to achieve a purpose of this subtitle. Such local serv13 ice providers may include the local service providers

14 described in paragraph (1)(B).

15 (3) OTHER STATE ACTIVITIES.—A State may

16 use not more than 12 percent of the funds paid to

17 the State under this subtitle for any fiscal year that

18 remain after the application of paragraph (1) for

19 one or more of the following purposes:

20 (A) The establishment or operation of pro21 fessional development programs to improve the

22 quality of instruction provided in local adult

23 education and literacy programs, including in24 struction provided by volunteers.
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1 (B) The provision of technical assistance

2 to local service providers.

3 (C) The provision of technology assistance

4 to local service providers to enable them to im5 prove the quality of their programs, services,

6 and activities that achieve a purpose of this

7 subtitle, including—

8 (i) providing hardware and software;

9 (ii) paying for service connection fees

10 associated with gaining access to comput11 erized databases; and

12 (iii) upgrading the technological capa13 bilities of local service providers to improve

14 the quality of their services and to assist

15 them in providing services on a flexible

16 schedule that meets the needs of diverse

17 populations.

18 (D) The support of State or regional net19 works of literacy resource centers that—

20 (i) enhance the coordination of lit21 eracy services across public and private

22 programs and State agencies;

23 (ii) enhance the capacity of the State

24 and local service providers to provide lit25 eracy services through the diffusion and
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1 adoption of state-of-the-art teaching meth2 ods and technologies;

3 (iii) provide linkages between the Na4 tional Institute for Literacy established

5 under section 441 and local service provid6 ers for the sharing of literacy information,

7 research, and resources;

8 (iv) encourage government and indus9 try partnerships; and

10 (v) provide training and technical as11 sistance to literacy instructors in reading

12 instruction, the use of state-of-the-art

13 methodologies, instructional materials, and

14 technologies, and professional development.

15 (E) Monitoring and evaluating the quality

16 of, and the improvement in, services and activi17 ties conducted with Federal financial assistance

18 under this subtitle, including carrying out sec19 tion 433(a)(2).

20 (F) The support of a common management

21 information system as described in section 109.

22 (G) Carrying out other activities of state23 wide significance that promote the purposes of

24 this Act.
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1 (4) ADMINISTRATIVE EXPENSES.—For any fis2 cal year, a State may use not more than 3 percent

3 of the funds paid to the State under this subtitle

4 that remain after the application of paragraph (1) or

5 $50,000, whichever is greater, for—

6 (A) planning, administration, and inter7 agency coordination associated with a grant

8 under this subtitle; and

9 (B) support for integrated career center

10 systems described in section 107.

11 (b) LOCAL USES OF FUNDS.—A State shall require

12 that a local service provider that receives a grant from

13 the State under paragraph (1) or (2) of subsection (a)

14 use the grant to establish or operate one or more programs

15 that provide instruction or services within one or more of

16 the following categories:

17 (1) Adult basic education that is designed for

18 an adult who—

19 (A) has minimal competence in reading,

20 writing, or computation;

21 (B) is not sufficiently competent in read22 ing, writing, or computation to meet the re23 quirements of adult life in the United States; or

24 (C) is not sufficiently competent in speak25 ing, reading, or writing the English language to
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1 obtain employment commensurate with the

2 adult’s intellectual abilities.

3 (2) Adult secondary education that is designed

4 for an adult who is literate and can function in ev5 eryday life, but who—

6 (A) has not acquired basic educational

7 skills, including reading, writing, and computa8 tion; or

9 (B) does not have a certificate of gradua10 tion from a school providing education to stu11 dents in grade 12, or its equivalent.

12 (3) English literacy instruction that is designed

13 for an adult—

14 (A) who—

15 (i) has limited ability in speaking,

16 reading, writing, or understanding the

17 English language and whose native lan18 guage is a language other than English; or

19 (ii) lives in a family or community en20 vironment where a language other than

21 English is the dominant language; and

22 (B) who, by reason of a condition de23 scribed in subparagraph (A), has sufficient dif24 ficulty reading, writing, or understanding the

25 English language that the adult is unable—
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1 (i) to learn successfully in a classroom

2 where the language of instruction is Eng3 lish; or

4 (ii) to participate fully in the society

5 of the United States.

6 (4) Family literacy services.

7 (c) AUTHORIZATION TO RECEIVE PAYMENTS FROM

8 OTHER PROGRAMS.—A local service provider that receives

9 a grant from a State under paragraph (1) or (2) of sub10 section (a), and that provides adult education and literacy

11 services to an adult who was referred to the provider by

12 a program supported under title II or III, may receive pay13 ment for the services from the program, either in the form

14 of a career grant or by some other means.

15 SEC. 433. ADDITIONAL GRANT REQUIREMENTS.

16 (a) GOALS, PROGRESS INDICATORS, PERFORMANCE

17 MEASURES.—

18 (1) PLANNING REQUIREMENTS.—A State that

19 desires to receive a grant under this subtitle shall

20 accomplish the following:

21 (A) Establish, through the collaborative

22 process described in section 103, measurable

23 goals for improving literacy levels, retention in

24 literacy programs, and long-term learning gains

25 of individuals in the State.
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1 (B) Based on such goals and the perform2 ance measures described in section 110(f), es3 tablish, through such collaborative process,

4 progress indicators to be used to evaluate the

5 performance of local service providers receiving

6 a grant under paragraph (1) or (2) of section

7 432(a).

8 (C) Describe such goals and progress indi9 cators in the State workforce development and

10 literacy plan submitted to the Secretary under

11 section 104.

12 (2) IMPLEMENTATION REQUIREMENTS.—A

13 State that receives a grant under this subtitle shall

14 accomplish the following:

15 (A) With respect to each local service pro16 vider receiving a grant under paragraph (1) or

17 (2) of section 432(a), based on the goals and

18 progress indicators established under paragraph

19 (1), measure the performance measures de20 scribed in section 110(f) and use the data pro21 duced by such measurement to improve the

22 quality of services provided to program partici23 pants or service recipients.

24 (B) Beginning on the date that is 2 years

25 after the first date that a local service provider
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1 receives a grant under paragraph (1) or (2) of

2 section 432(a), annually assess the degree to

3 which the provider is meeting or exceeding the

4 progress indicators applicable to the provider.

5 (C) Annually report to the Secretary on

6 the performance measures described in section

7 434 for each category described in such section.

8 (b) OTHER REQUIREMENTS.—A State that receives

9 a grant under this subtitle shall ensure the following:

10 (1) EXPENDITURES OF NON-FEDERAL

11 FUNDS.—For any fiscal year for which a grant is

12 made to the State under this subtitle, the State shall

13 expend, on programs and activities relating to adult

14 education and family literacy services, an amount,

15 derived from sources other than the Federal Govern16 ment, equal to 25 percent of the State’s initial and

17 additional allotments for the year.

18 (2) PRIORITY FOR PLANNING WITH BOARDS

19 AND SYSTEMS.—In awarding grants to local service

20 providers under paragraph (1) or (2) of section

21 432(a), the State shall give priority to providers that

22 demonstrate joint planning with local workforce de23 velopment boards and integrated career center sys24 tems.
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1 (3) EQUITABLE ACCESS.—Local educational

2 agencies, public or private nonprofit agencies, com3 munity-based organizations, correctional education

4 agencies, institutions of higher education, libraries,

5 and institutions which serve educationally disadvan6 taged adults shall be provided direct and equitable

7 access to Federal funds provided under this subtitle

8 in accordance with this subtitle.

9 (4) PAYMENTS BY LOCAL WORKFORCE DEVEL10 OPMENT BOARDS TO LOCAL SERVICE PROVIDERS.—

11 A local service provider that receives a grant from

12 a State under paragraph (1) or (2) of section 432(a)

13 may negotiate with a local workforce development

14 board with respect to receipt of payments for adult

15 education and literacy services provided by the pro16 vider to adults referred to the provider by a program

17 supported under title II or III.

18 CHAPTER 3—NATIONAL PROGRAMS

19 SEC. 441. NATIONAL INSTITUTE FOR LITERACY.

20 (a) ESTABLISHMENT.—

21 (1) IN GENERAL.—There shall be established a

22 National Institute for Literacy (in this section re23 ferred to as the ‘‘Institute’’). The Institute shall be

24 administered under the terms of an interagency

25 agreement entered into by the Secretary of Edu-
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1 cation with the Secretary of Labor and the Secretary

2 of Health and Human Services (in this section re3 ferred to as the ‘‘Interagency Group’’). The Sec4 retary may include in the Institute any research and

5 development center, institute, or clearinghouse estab6 lished within the Department of Education whose

7 purpose is determined by the Secretary to be related

8 to the purpose of the Institute.

9 (2) BOARD RECOMMENDATIONS.—The Inter10 agency Group shall consider the recommendations of

11 the National Institute for Literacy Advisory Board

12 (in this section referred to as the ‘‘Board’’) estab13 lished under subsection (d) in planning the goals of

14 the Institute and in the implementation of any pro15 grams to achieve such goals.

16 (3) DAILY OPERATIONS.—The daily operations

17 of the Institute shall be carried out by the Director

18 of the Institute appointed under subsection (g).

19 (b) DUTIES.—

20 (1) IN GENERAL.—The Institute shall—

21 (A) provide national leadership for the im22 provement and expansion of the system for de23 livery of literacy services;

24 (B) coordinate the delivery of such serv25 ices;
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1 (C) support the creation of new methods of

2 offering improved services;

3 (D) serve as a national resource for adult

4 education and family literacy services by provid5 ing to the public the best and most current in6 formation available on the subjects; and

7 (E) assist States in developing levels of

8 performance.

9 (2) AUTHORIZED ACTIVITIES.—In order to

10 carry out the duties described in paragraph (1), the

11 Institute may—

12 (A) establish a national electronic database

13 of information that includes—

14 (i) information on—

15 (I) effective practices in the pro16 vision of literacy and basic skills in17 struction;

18 (II) public and private literacy

19 and basic skills programs and Fed20 eral, State, and local policies affecting

21 the provision of literacy services at the

22 national, State, and local levels; and

23 (III) technical assistance, meet24 ings, conferences, and other opportu-
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1 nities that lead to the improvement of

2 literacy and basic skills services; and

3 (ii) a communication network for lit4 eracy programs, providers, and students;

5 (B) coordinate support for the provision of

6 literacy and basic skills services across Federal

7 agencies and at the State and local level;

8 (C) coordinate the support of research and

9 development on literacy and basic skills in fami10 lies and adults across Federal agencies and

11 carry out basic and applied research and devel12 opment on topics that are not being inves13 tigated by other organizations or agencies;

14 (D) collect and disseminate information on

15 methods of advancing literacy that show prom16 ise of success; and

17 (E) assist in the development of policy

18 with respect to literacy and basic skills.

19 (3) GRANTS, CONTRACTS, AND AGREEMENTS.—

20 The Institute may enter into contracts or coopera21 tive agreements with, or make grants to, individuals,

22 public or private institutions, agencies, organiza23 tions, or consortia of such institutions, agencies, or

24 organizations to carry out the activities of the Insti25 tute. Such grants, contracts, or agreements shall be
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1 subject to the laws and regulations that generally

2 apply to grants, contracts, or agreements entered

3 into by Federal agencies.

4 (c) LITERACY LEADERSHIP.—

5 (1) FELLOWSHIPS.—The Institute, in consulta6 tion with the Board, may award fellowships, with

7 such stipends and allowances as the Director consid8 ers necessary, to outstanding individuals pursuing

9 careers in adult education or literacy in the areas of

10 instruction, management, research, or innovation.

11 (2) USE OF FELLOWSHIPS.—Fellowships

12 awarded under this subsection shall be used, under

13 the auspices of the Institute, to engage in research,

14 education, training, technical assistance, or other ac15 tivities to advance the field of adult education or lit16 eracy, including the training of volunteer literacy

17 providers at the national, State, or local level.

18 (3) INTERNS AND VOLUNTEERS.—The Insti19 tute, in consultation with the Board, may award

20 paid and unpaid internships to individuals seeking to

21 assist the Institute in carrying out its mission. Not22 withstanding section 1342 of title 31, United States

23 Code, the Institute may accept and use voluntary

24 and uncompensated services as the Institute deter25 mines necessary.
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1 (d) NATIONAL INSTITUTE FOR LITERACY ADVISORY

2 BOARD.—

3 (1) ESTABLISHMENT.—

4 (A) IN GENERAL.—There shall be a Na5 tional Institute for Literacy Advisory Board.

6 The Board shall consist of 10 individuals ap7 pointed by the President with the advice and

8 consent of the Senate from individuals who—

9 (i) are not otherwise officers or em10 ployees of the Federal Government; and

11 (ii) are representative of entities or

12 groups described in subparagraph (B).

13 (B) ENTITIES OR GROUPS DESCRIBED.—

14 The entities or groups referred to in subpara15 graph (A) are—

16 (i) literacy organizations and provid17 ers of literacy services, including—

18 (I) nonprofit providers of literacy

19 services;

20 (II) providers of programs and

21 services involving English language in22 struction; and

23 (III) providers of services receiv24 ing assistance under this subtitle;
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1 (ii) businesses that have demonstrated

2 interest in literacy programs;

3 (iii) literacy students;

4 (iv) experts in the area of literacy re5 search;

6 (v) State and local governments; and

7 (vi) representatives of employees.

8 (2) DUTIES.—The Board shall—

9 (A) make recommendations concerning the

10 appointment of the Director and staff of the In11 stitute;

12 (B) provide independent advice on the op13 eration of the Institute; and

14 (C) receive reports from the Interagency

15 Group and the Director.

16 (3) TERMS.—

17 (A) IN GENERAL.—Each member of the

18 Board shall be appointed for a term of 3 years,

19 except that the initial terms for members may

20 be 1, 2, or 3 years in order to establish a rotation in which 1 21 ⁄3 of the members are selected

22 each year.

23 (B) VACANCY APPOINTMENTS.—Any mem24 ber appointed to fill a vacancy occurring before

25 the expiration of the term for which the mem-
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1 ber’s predecessor was appointed shall be ap2 pointed only for the remainder of that term. A

3 member may serve after the expiration of that

4 members’ term until a successor has taken of5 fice. A vacancy in the Board shall be filled in

6 the manner in which the original appointment

7 was made. A vacancy in the Board shall not af8 fect the powers of the Board.

9 (4) QUORUM.—A majority of the members of

10 the Board shall constitute a quorum but a lesser

11 number may hold hearings. Any recommendation

12 may be passed only by a majority of its members

13 present.

14 (5) CHAIRPERSON AND VICE CHAIRPERSON.—

15 The chairperson and vice chairperson of the Board

16 shall be elected by the members. The term of office

17 of the chairperson and vice chairperson shall be 1

18 year.

19 (6) MEETINGS.—The Board shall meet at the

20 call of the chairperson or a majority of its members.

21 (e) GIFTS, BEQUESTS, AND DEVISES.—The Institute

22 may accept, administer, and use gifts or donations of serv23 ices, money, or property, both real and personal.

24 (f) MAILS.—The Board and the Institute may use the

25 United States mails in the same manner and under the
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1 same conditions as other departments and agencies of the

2 United States.

3 (g) STAFF.—The Interagency Group, after consider4 ing recommendations made by the Board, shall appoint

5 and fix the pay of a Director.

6 (h) APPLICABILITY OF CERTAIN CIVIL SERVICE

7 LAWS.—The Director and staff of the Institute may be

8 appointed without regard to the provisions of title 5,

9 United States Code, governing appointments in the com10 petitive service, and may be paid without regard to the

11 provisions of chapter 51 and subchapter III of chapter 53

12 of that title relating to classification and General Schedule

13 pay rates, except that an individual so appointed may not

14 receive pay in excess of the maximum rate payable under

15 section 5376 of title 5, United States Code.

16 (i) EXPERTS AND CONSULTANTS.—The Board and

17 the Institute may procure temporary and intermittent

18 services under section 3109(b) of title 5, United States

19 Code.

20 (j) REPORT.—The Institute shall submit a biennial

21 report to the Interagency Group and the Congress.

22 SEC. 442. NATIONAL LEADERSHIP ACTIVITIES.

23 (a) IN GENERAL.—The Secretary shall establish and

24 carry out a program of national leadership and evaluation
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1 activities to enhance the quality of adult education and

2 family literacy programs nationwide.

3 (b) REQUIRED ACTIVITY.—

4 (1) IN GENERAL.—The program of national

5 leadership and evaluation activities under subsection

6 (a) shall include a national evaluation, conducted by

7 the Secretary, of the programs and activities carried

8 out by States and local service providers with Fed9 eral funds received under this subtitle. Such evalua10 tion shall include information on the following:

11 (A) The manner in which States and local

12 service providers use Federal funds, including

13 the manner in which States allocate such funds

14 among such providers.

15 (B) The manner in which States establish

16 goals and performance standards and use such

17 goals and standards to manage and improve

18 programs.

19 (C) The effectiveness of the funds used

20 under subparagraphs (B) and (C) of section

21 432(a)(3).

22 (D) The manner in which economically dis23 advantaged individuals and educationally dis24 advantaged adults are being served by States

25 and local service providers.
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1 (E) The coordination between programs

2 and activities carried out with Federal funds re3 ceived under titles II and III and programs and

4 activities carried out with Federal funds re5 ceived under this subtitle.

6 (F) The percentage of individuals receiving

7 a service from an integrated career center sys8 tem who are referred by such system to a local

9 service provider providing adult education or lit10 eracy services.

11 (2) REPORT.—Not later than September 30,

12 2001, the Secretary shall provide to the Congress

13 and publicly publish the results of the evaluation

14 conducted under paragraph (1).

15 (c) AUTHORIZED ACTIVITIES.—

16 (1) IN GENERAL.—The program of national

17 leadership and evaluation activities under subsection

18 (a) may include the following:

19 (A) Assisting States in developing levels of

20 performance.

21 (B) Research and development.

22 (C) Demonstration of model and innovative

23 programs.

24 (D) Evaluations, including independent

25 evaluations of adult education and family lit-
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1 eracy programs carried out with financial as2 sistance received pursuant to this subtitle.

3 (E) Data collection.

4 (F) Professional development.

5 (G) Technical assistance to States and

6 local service providers receiving Federal finan7 cial assistance pursuant to this subtitle.

8 (H) Making grants to State or regional

9 networks of literacy resource centers described

10 in section 432(a)(3)(D).

11 (I) Other activities to enhance the quality

12 of adult education and family literacy programs

13 nationwide.

14 (2) GRANTS, CONTRACTS, AND COOPERATIVE

15 AGREEMENTS.—The Secretary may carry out the ac16 tivities described in paragraph (1) directly or

17 through grants, contracts, and cooperative agree18 ments.

19 Subtitle B—Library Services and

20 Technology Consolidation Grant

21 SEC. 451. PURPOSES.

22 The purposes of this subtitle are—

23 (1) to consolidate Federal library service pro24 grams;
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1 (2) to improve public access to information

2 through electronic networks; and

3 (3) to provide linkages among and between li4 braries and integrated career center systems.

5 SEC. 452. AUTHORIZATION OF APPROPRIATIONS.

6 (a) IN GENERAL.—There are authorized to be appro7 priated to carry out this subtitle $110,000,000 for each

8 of the fiscal years 1997 through 2002.

9 (b) ADVANCE NOTICE OF FUNDING.—For the pur10 pose of affording adequate notice of funding available

11 under this subtitle, an appropriation to carry out this sub12 title is authorized to be included in an appropriation Act

13 for the fiscal year preceding the fiscal year for which such

14 appropriation is first available for obligation.

15 SEC. 453. ALLOTMENTS.

16 (a) INITIAL ALLOTMENTS.—

17 (1) IN GENERAL.—From the sums appropriated

18 under section 452 for any fiscal year, the Secretary

19 shall allot—

20 (A) $40,000 each to Guam, American

21 Samoa, the Commonwealth of the Northern

22 Mariana Islands, and the Virgin Islands; and

23 (B) $200,000 to each of the other States.

24 (2) RATABLE REDUCTION.—If the sums appro25 priated under section 452 for any fiscal year are in-
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1 sufficient to pay all of the allotments under para2 graph (1), each such allotment shall be ratably re3 duced.

4 (b) ADDITIONAL ALLOTMENTS.—

5 (1) IN GENERAL.—From the remainder of the

6 sums appropriated under section 452 for any fiscal

7 year after the application of subsection (a), the Sec8 retary shall allot to each State an amount which

9 bears the same ratio to such remainder as the popu10 lation of the State bears to the population of all

11 States.

12 (2) DETERMINATION OF POPULATION OF

13 STATES.—For the purpose of this subsection, the

14 population of each State, and the total population of

15 all States, shall be determined by the Secretary on

16 the basis of the most recent census data available to

17 the Secretary, and the Secretary shall use for such

18 purpose, if available, the annual interim current cen19 sus data produced by the Secretary of Commerce

20 pursuant to section 181 of title 13, United States

21 Code.

22 SEC. 454. GRANTS TO STATES.

23 (a) IN GENERAL.—The Secretary shall make a grant

24 for a fiscal year to a State if the State—
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1 (1) has submitted to the Secretary for the year

2 an annual application that has been approved by the

3 Secretary under section 456; and

4 (2) has entered into a written agreement with

5 the Secretary that—

6 (A) the State will provide 100 percent of

7 the funds paid to the State under this subtitle

8 for the year to the State library administrative

9 agency for the State;

10 (B) such agency will be required to use

11 such funds to carry out activities that—

12 (i) are described in such annual appli13 cation;

14 (ii) achieve the purposes of this sub15 title; and

16 (iii) satisfy the requirements of sec17 tion 455;

18 (C) there will be available from State and

19 local sources for expenditure by such agency to

20 carry out such activities an amount that equals

21 or exceeds 25 percent of the total cost (as de22 termined by the Secretary) of carrying out such

23 activities for the year; and
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1 (D) such agency has the fiscal and legal

2 authority and capability to administer all as3 pects of such activities.

4 (b) AMOUNT OF GRANTS.—The amount of a grant

5 to a State under subsection (a) for a fiscal year shall equal

6 the lesser of the following:

7 (1) The sum of the initial and additional allot8 ments of the State for the year.

9 (2) 75 percent of the total cost (as determined

10 by the Secretary) of carrying out the activities de11 scribed in subsection (a)(2)(B) for the year.

12 SEC. 455. USES OF FUNDS.

13 (a) IN GENERAL.—Of the funds provided to a State

14 library administrative agency under section 454(a)(2)(A),

15 the agency shall expend (either directly or through

16 subgrants or cooperative agreements) at least 97 percent

17 for one or more of the following purposes:

18 (1) Electronically connecting libraries with inte19 grated career center systems designated or estab20 lished under section 107 and local service providers

21 receiving grants under paragraph (1) or (2) of sec22 tion 432(a).

23 (2) Establishing or enhancing linkages among

24 libraries.
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1 (3) Assisting libraries in accessing information

2 through electronic networks.

3 (4) Encouraging libraries in different Federal,

4 State, and local jurisdictions, and different types of

5 libraries, to establish consortia and share resources.

6 (5) Paying costs for libraries to acquire or

7 share computer systems and telecommunications

8 technologies.

9 (6) Improving library and information services

10 for individuals who have difficulty using a library or

11 who need special library materials or services, in12 cluding individuals under the age of 18.

13 (b) ADMINISTRATIVE EXPENSES.—In any fiscal year,

14 a State library administrative agency may use not more

15 than 3 percent of the funds provided to the agency under

16 section 454(a)(2)(A) for planning, administration, evalua17 tions, and interagency coordination associated with a

18 grant under this subtitle.

19 SEC. 456. ANNUAL APPLICATIONS.

20 (a) SUBMISSION.—A State that desires to receive a

21 grant under this subtitle for a fiscal year shall submit to

22 the Secretary, in such form and manner and before such

23 deadline as the Secretary shall specify in regulations, an

24 application for such year. Such application shall—
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1 (1) establish goals, and specify priorities, for

2 the State consistent with the purposes of this sub3 title;

4 (2) describe activities that are consistent with

5 such goals and priorities, the purposes of this sub6 title, and the requirements of section 455 that the

7 State library administrative agency will carry out

8 during such year using such grant;

9 (3) describe the procedures that such agency

10 will use to carry out such activities;

11 (4) describe the methodology that such agency

12 will use to evaluate the success of such activities in

13 achieving such goals and meeting such priorities;

14 (5) describe procedures that such agency will

15 use to involve libraries and library users throughout

16 the State in policy decisions regarding implementa17 tion of this subtitle; and

18 (6) provide assurances satisfactory to the Sec19 retary that such agency will make such reports, in

20 such form and containing such information, as the

21 Secretary may reasonably require to carry out this

22 subtitle and to determine the extent to which funds

23 provided under this subtitle have been effective in

24 carrying out its purposes.

25 (b) APPROVAL.—
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1 (1) IN GENERAL.—The Secretary shall approve

2 each application submitted under subsection (a) that

3 satisfies the requirements of the subsection.

4 (2) RIGHTS OF STATES UPON DISAPPROVAL.—

5 If the Secretary determines that an application sub6 mitted by a State under subsection (a) does not sat7 isfy the requirements of such subsection, the Sec8 retary shall—

9 (A) immediately notify the State of such

10 determination and the reasons for such deter11 mination; and

12 (B) offer the State an opportunity to re13 vise its application to correct any deficiencies.

14 TITLE V—AMENDMENTS TO

15 REHABILITATION ACT OF 1973

16 Subtitle A—Vocational

17 Rehabilitation Consolidation Grant

18 CHAPTER 1—TRANSITION PERIOD

19 SEC. 501. TRANSITION.

20 With respect to the amendment made by section

21 511(a)(4) to title I of the Rehabilitation Act of 1973, the

22 Secretary of Education, acting through the Commissioner

23 of the Rehabilitation Services Administration, shall admin24 ister the amendment in accordance with the following:
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1 (1) During fiscal year 1996, the Secretary shall

2 develop administrative policies for implementing the

3 amendment.

4 (2) During the fiscal years 1997 and 1998, the

5 Secretary shall begin implementing the amendment

6 in accordance with paragraph (4).

7 (3) The Secretary shall ensure that, by the first

8 day of fiscal year 1999, the amendment is fully im9 plemented.

10 (4) For purposes of paragraph (2), the Sec11 retary shall ensure that, before the first day of fiscal

12 year 1999, the following requirements, administered

13 as conditions on the receipt of grants under such

14 title, have been met:

15 (A) The States have complied with section

16 103(b)(4) of such title (as amended by section

17 511) regarding the participation of certain pro18 viders.

19 (B) The States have established policies

20 and made arrangements for the operation of the

21 system of career grants described in section

22 103(c) of such title, including with respect to

23 the reimbursement of providers.

24 (C) The States have established policies

25 and made arrangements under section
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1 103(b)(12) of such title regarding the training

2 of the management and staff of integrated ca3 reer center systems with respect to individuals

4 with disabilities.

5 (D) The States have established policies

6 and made arrangements under section 104 of

7 such title regarding the establishment of such

8 centers, including providing for the significant

9 participation of community-based providers in

10 the program carried out by the State pursuant

11 to such title.

12 (E) Such other requirements under the

13 amendment as the Secretary determines to be

14 appropriate.

15 (5)(A) Notwithstanding the amendment, during

16 the fiscal years 1996 through 1998, the provisions

17 of title I of the Rehabilitation Act of 1973 that were

18 in effect on the day before the date of the enactment

19 of this Act continue to be in effect, subject to para20 graphs (1) through (4). In implementing the amend21 ment, the Secretary shall seek to avoid unnecessarily

22 disrupting the provision of services under such title

23 to individuals who, as of the date of the enactment

24 of this Act, were receiving services pursuant to an

25 individualized plan under such title.
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1 (B) On and after the first day of fiscal year

2 1999, the provisions referred to in the first sentence

3 of subparagraph (A) do not have any legal effect.

4 CHAPTER 2—REVISION OF TITLE I OF

5 REHABILITATION ACT OF 1973

6 SEC. 511. REVISION OF TITLE I.

7 (a) IN GENERAL.—Effective October 1, 1995, the

8 Rehabilitation Act of 1973 (29 U.S.C. 701 et seq.) is

9 amended—

10 (1) by transferring section 112 from the cur11 rent placement of the section;

12 (2) by redesignating such section as section

13 510;

14 (3) by adding such section at the end of title

15 V; and

16 (4) by amending title I to read as follows:

17 ‘‘TITLE I—VOCATIONAL

18 REHABILITATION SERVICES

19 ‘‘SEC. 100. PURPOSE.

20 ‘‘The purpose of this title is to assist States in mak21 ing available to individuals with disabilities a program of

22 employment, training, and rehabilitation services that is

23 consistent with their strengths, resources, priorities, con24 cerns, abilities, and capabilities; that maximizes individ25 uals’ control over their vocational and career choices; and
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1 that is in accordance with the goal of assuring equality

2 of opportunity, full participation, independent living, and

3 economic self-sufficiency for such individuals.

4 ‘‘SEC. 101. FORMULA GRANTS.

5 ‘‘(a) IN GENERAL.—

6 ‘‘(1) FORMULA GRANTS.—In the case of each

7 State that submits to the Secretary a workforce de8 velopment and literacy plan for fiscal year 1999 or

9 any subsequent fiscal year that meets the require10 ment of section 104 of the Consolidated and Re11 formed Education, Employment, and Rehabilitation

12 Systems Act, the Secretary shall make a grant for

13 the year to the State as the Federal share of carry14 ing out the purposes specified in this title. The grant

15 shall consist of the allotment determined for the

16 State under section 107.

17 ‘‘(2) CONDITIONS FOR GRANT.—A State may

18 receive a grant under paragraph (1) for a fiscal year

19 only if the State meets the conditions described in

20 this title for the State for the fiscal year.

21 ‘‘(b) ADMINISTRATOR OF FEDERAL PROGRAM.—The

22 Secretary shall carry out this title acting through the

23 Commissioner of the Rehabilitation Services Administra24 tion, except as indicated otherwise.
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1 ‘‘(c) RULE OF CONSTRUCTION.—The purpose speci2 fied in section 100 shall be carried out only in accordance

3 with the other provisions of this title.

4 ‘‘(d) FUNDING.—

5 ‘‘(1) AUTHORIZATION OF APPROPRIATIONS.—

6 For the purpose of carrying out this title, there are

7 authorized to be appropriated such sums as may be

8 necessary for each of the fiscal years 1999 through

9 2002, except that the amount to be appropriated for

10 a fiscal year shall not be less than the amount of the

11 appropriation under this subsection for the imme12 diately preceding fiscal year, plus the amount of the

13 Consumer Price Index addition determined under

14 paragraph (2) for the immediately preceding fiscal

15 year.

16 ‘‘(2) ADJUSTMENTS PURSUANT TO CONSUMER

17 PRICE INDEX.—

18 ‘‘(A) Not later than November 15 of each

19 fiscal year, the Secretary of Labor shall publish

20 in the Federal Register the percentage change

21 in the Consumer Price Index published for Oc22 tober of the preceding fiscal year and October

23 of the fiscal year in which such publication is

24 made.
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1 ‘‘(B) If in any fiscal year the percentage

2 change published under subparagraph (A) indi3 cates an increase in the Consumer Price Index,

4 then the amount to be appropriated under para5 graph (1) for the subsequent fiscal year shall be

6 at least the amount appropriated for the fiscal

7 year in which the publication is made under

8 subparagraph (A) increased by such percentage

9 change.

10 ‘‘(C) If in any fiscal year the percentage

11 change published under subparagraph (A) does

12 not indicate an increase in the Consumer Price

13 Index, then the amount to be appropriated

14 under paragraph (1) for the subsequent fiscal

15 year shall be at least the amount appropriated

16 for the fiscal year in which the publication is

17 made under subparagraph (A).

18 ‘‘(D) For purposes of this paragraph, the

19 term ‘Consumer Price Index’ means the

20 Consumer Price Index for All Urban Consum21 ers, published monthly by the Bureau of Labor

22 Statistics.

23 ‘‘(3) AUTOMATIC EXTENSION OF AUTHORIZA24 TION.—
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1 ‘‘(A) Unless, in the regular session that

2 ends prior to the beginning of the last fiscal

3 year for which an authorization of appropria4 tions is provided in paragraph (1), legislation

5 has been enacted that has the effect of extend6 ing such authorization, such authorization is

7 automatically extended for one additional year.

8 ‘‘(B) The amount authorized to be appro9 priated for the additional fiscal year described

10 in subparagraph (A) shall be an amount equal

11 to the amount appropriated for such program

12 for fiscal year 2002, plus the amount of the

13 Consumer Price Index addition determined

14 under paragraph (2) for the immediately pre15 ceding fiscal year.

16 ‘‘(C) In any case where the Commissioner

17 is required under an applicable statute to carry

18 out certain acts or make certain determinations

19 that are necessary for the continuation of the

20 program authorized by this title, and such acts

21 or determinations are required during the last

22 fiscal year for which an authorization of appro23 priations is provided in paragraph (1), such

24 acts and determinations shall be required dur-
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1 ing any fiscal year for which subparagraph (A)

2 is in operation.

3 ‘‘SEC. 102. ALLOCATION WITHIN STATE OF ADMINISTRA4 TIVE RESPONSIBILITIES.

5 ‘‘(a) IN GENERAL.—For purposes of section 101(a),

6 a State will—

7 ‘‘(1) subject to subsection (b), reserve not more

8 than 20 percent of the grant under such section for

9 the fiscal year involved for carrying out the respon10 sibilities of a State administrative agent under sec11 tion 103; and

12 ‘‘(2) reserve not less than 80 percent of the

13 grant for carrying out the responsibilities under sec14 tion 104 of local workforce development boards and

15 integrated career center systems with respect to

16 workforce development areas.

17 ‘‘(b) ADDITIONAL STATE RESPONSIBILITIES.—

18 Amounts reserved by a State under subsection (a)(1) may

19 be expended by the State administrative agent to carry

20 out responsibilities that otherwise would be carried out

21 under section 104 by local workforce development boards

22 or integrated career center systems, if the State deter23 mines that such expenditures are justified to make avail24 able goods and services that could not otherwise be ob25 tained within a local workforce development area, to pro-
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1 vide services to individuals unable to utilize the integrated

2 career center systems, or to otherwise ensure the efficient

3 and equitable provision in the State of services under this

4 title, including the provision of services for individuals in

5 rural areas.

6 ‘‘(c) CERTAIN DEFINITIONS.—For purposes of this

7 Act, the terms ‘State administrative agent’, ‘local

8 workforce development area’, ‘local workforce development

9 board’, and ‘integrated career center’ have the meanings

10 given such terms in sections 105 through 108, respec11 tively, of the Consolidated and Reformed Education, Em12 ployment, and Rehabilitation Systems Act.

13 ‘‘SEC. 103. RESPONSIBILITIES OF STATE ADMINISTRATIVE

14 AGENT.

15 ‘‘(a) STATE ADMINISTRATIVE AGENT.—In carrying

16 out the requirements of the Consolidated and Reformed

17 Education, Employment, and Rehabilitation Systems Act,

18 a Governor may designate—

19 ‘‘(1) one State administrative agent to be re20 sponsible for carrying out this title for individuals

21 who are blind; and

22 ‘‘(2) a different State administrative agent to

23 carry out the remaining responsibilities in this title.
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1 ‘‘(b) RESPONSIBILITIES.—For purposes of section

2 101(a) and the operation in a State of the program under

3 this title:

4 ‘‘(1) This subsection, and the subsequent provi5 sions of this section, will be carried out by State ad6 ministrative agents designated by the Governor in

7 accordance with subsection (a), through the collabo8 rative process established under section 103 of the

9 Consolidated and Reformed Education, Employment,

10 and Rehabilitation Systems Act.

11 ‘‘(2)(A) The State will provide to the public an

12 explanation of the methods by which the State will

13 provide vocational rehabilitation services (as defined

14 in section 104(b))—

15 ‘‘(i) to all eligible individuals (as defined in

16 section 105(d)); and

17 ‘‘(ii) within all local workforce delivery

18 areas in the State.

19 ‘‘(B) In the event that such services cannot be

20 provided to all eligible individuals who apply for the

21 services, the State will show and provide the jus22 tification for the order to be followed in selecting in23 dividuals to whom the services will be provided.

24 ‘‘(C) The order of selection under subparagraph

25 (B) will be determined on the basis of serving first
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1 those individuals with the most severe disabilities, in

2 accordance with criteria established by the State.

3 ‘‘(3) The State will establish guidelines provid4 ing that, in the case of an individual to whom the

5 State will provide a service (in accordance with the

6 order of selection under paragraph (2) and the as7 sessment of needs under section 104(c)(1)), the indi8 vidual will have the option of receiving the service

9 from a provider designated by the center or from a

10 provider selected by the individual pursuant to ca11 reer grants under subsection (c).

12 ‘‘(4) Pursuant to section 109 of the Consoli13 dated and Reformed Education, Employment, and

14 Rehabilitation Systems Act, the State will make sig15 nificant efforts to encourage the participation in the

16 State program of community-based private provid17 ers, with special consideration given to providers

18 who have received funds under this Act regarding

19 projects with industry or supported employment

20 services, or under the Act commonly known as the

21 Javits-Wagner-O’Day Act (41 U.S.C. 46 et seq.) for

22 employment and training services.

23 ‘‘(5) The State will establish provisions to gov24 ern determinations under section 105 (relating to

25 the eligibility of individuals).
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1 ‘‘(6) The State will establish standards to gov2 ern the conduct under section 104(c)(1) of assess3 ments of need, including the development of a meth4 odology that will be applied in a reasonably uniform

5 manner to all individuals for whom such assessments

6 are conducted, and that (subject to the order of se7 lection under paragraph (2)) will be designed to pre8 vent substantial disparities, among individuals with

9 comparable circumstances, in the monetary value of

10 the services to be provided pursuant to the assess11 ments.

12 ‘‘(7)(A) The State will establish procedures

13 through which an individual may request and obtain

14 an impartial review, utilizing an impartial hearing

15 officer, of whether standards for determinations of

16 eligibility for services, assessments of vocational re17 habilitation needs, and development of individualized

18 rehabilitation and employment plans under this title

19 were correctly applied to the individual by the inte20 grated career center system involved.

21 ‘‘(B) The State will designate a number of days

22 (applied uniformly to all individuals) within which

23 review under subparagraph (A) will be conducted

24 once a request for such review is made by an indi25 vidual, subject to subparagraph (C).
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1 ‘‘(C)(i) The State will provide that there may

2 be an informal hearing, mediation, or alternatives to

3 such review, if agreed upon by the individual and the

4 integrated career center system involved.

5 ‘‘(ii) The State will provide that if, in a process

6 utilized under clause (i) by an individual, there is

7 not a final disposition of the matter involved, review

8 under subparagraph (A) will remain available to the

9 individual.

10 ‘‘(8) The State will ensure that vocational reha11 bilitation services under this title, and related core

12 services, are provided by personnel who are qualified

13 to provide the services involved. For purposes of the

14 preceding sentence, the term ‘core services’ has the

15 meaning indicated for such term under title I of the

16 Consolidated and Reformed Education, Employment,

17 and Rehabilitation Systems Act.

18 ‘‘(9) The State will establish plans, policies, and

19 procedures to be followed in carrying out the pro20 gram under this title in the State (including enter21 ing into a formal interagency cooperative agreement

22 with education officials responsible for the provision

23 of a free appropriate public education to students

24 who are individuals with disabilities). The State will
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1 ensure that such plans, policies, and procedures are

2 designed in accordance with the following:

3 ‘‘(A)(i) To facilitate the development and

4 accomplishment of the goals and objectives de5 scribed in clause (ii) (including the specification

6 of plans for coordination with the educational

7 agencies in the provision of transition services),

8 to the extent that the goals and objectives are

9 included in an individualized education program

10 of a student.

11 ‘‘(ii) The goals and objectives referred to

12 in clause (i) are long-term rehabilitation goals;

13 intermediate rehabilitation objectives; and goals

14 and objectives related to enabling a student to

15 live independently before the student leaves a

16 school setting.

17 ‘‘(B) To facilitate the transition from the

18 provision of a free appropriate public education

19 under the responsibility of an educational agen20 cy to the provision of vocational rehabilitation

21 services under this title, including the specifica22 tion of plans for coordination with educational

23 agencies in the provision of transition services

24 to an individual.

25 ‘‘(C) To provide for—
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1 ‘‘(i) provisions for determining State

2 lead agencies and qualified personnel re3 sponsible for transition services;

4 ‘‘(ii) procedures for outreach to and

5 identification of youth in need of such

6 services; and

7 ‘‘(iii) a timeframe for evaluation and

8 follow-up of youth who have received such

9 services.

10 ‘‘(10) The State will provide for coordination

11 and working relationships with the Statewide Inde12 pendent Living Council established under section

13 705 and independent living centers within the State.

14 ‘‘(11) The State will provide for interagency co15 operation with, and the utilization of the services

16 and facilities of, the State agencies administering

17 the State’s public assistance programs, and other

18 programs for individuals with disabilities.

19 ‘‘(12) With respect to the integrated career cen20 ter system operated pursuant to section 104, the

21 State will provide for the appropriate training of the

22 management and staff of the centers regarding the

23 effective provision of services to individuals with dis24 abilities.
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1 ‘‘(13) The State will provide technical assist2 ance to local boards, integrated career center sys3 tems, and providers relating to the effective provi4 sion of vocational rehabilitation services under this

5 title, including the effective development of individ6 ualized rehabilitation and employment plans, and

7 will ensure that such technical assistance is provided

8 through appropriate means.

9 ‘‘(c) AVAILABILITY OF CAREER GRANTS SYSTEM RE10 GARDING SERVICES.—For purposes of section 101(a) and

11 the operation in a State of the program under this title:

12 ‘‘(1) The State will provide for the establish13 ment of a system to carry out this subsection.

14 ‘‘(2) In the case of an eligible individual who

15 (in accordance with the order of selection under sub16 section (b)(2) and the assessment of needs under

17 section 105(b)(2)(A)) will receive vocational rehabili18 tation services under this title, the integrated career

19 center involved will, upon request of the individual,

20 provide to the individual career grants in accordance

21 with this subsection.

22 ‘‘(3) Career grants under this subsection will

23 enable such individual to obtain the vocational reha24 bilitation services involved from providers selected by

25 the individual from among a list of providers ap-
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1 proved by the State for such purpose in accordance

2 with section 109 of the Consolidated and Reformed

3 Education, Employment, and Rehabilitation Systems

4 Act.

5 ‘‘(4) The monetary value of a career grant pro6 vided to the individual for a particular type of serv7 ice will be calculated at a fair market value.

8 ‘‘(5) To the extent practicable, the list of pro9 viders under paragraph (3) will provide for the avail10 ability within each local workforce development area

11 of a broad range of services.

12 ‘‘(6) The aggregate value of the career grants

13 available to the individual will be established in pro14 portion to the degree of the individual’s need for re15 habilitation (as determined under section 104(c)(1)).

16 Such value regarding the individuals may be ad17 justed to address emerging needs that arise during

18 the course of the individual’s rehabilitation and em19 ployment program.

20 ‘‘(d) STATE OPTIONS.—With respect to compliance

21 with this section, a State may, in the discretion of the

22 State, expend a grant under section 101 for the following:

23 ‘‘(1) To disseminate findings from research re24 garding vocational rehabilitation services, after con25 sideration of requests from local workforce develop-
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1 ment boards and integrated career center systems

2 regarding the types of information needed by such

3 boards and centers.

4 ‘‘(2) To conduct demonstration projects regard5 ing improvements with respect to vocational rehabili6 tation services, subject to providing the results of

7 such projects to the Commissioner and as appro8 priate disseminating the results within the State.

9 ‘‘SEC. 104. RESPONSIBILITIES FOR LOCAL BOARDS AND

10 SERVICE CENTERS.

11 ‘‘(a) PROVISION OF VOCATIONAL REHABILITATION

12 SERVICES.—For purposes of section 101(a) and the oper13 ation in a State of the program under this title:

14 ‘‘(1) This section will be carried out by the inte15 grated career center system in the State, with each

16 such center acting under the guidance of the local

17 workforce development board for the local workforce

18 area within which the integrated career center sys19 tem operates. Such centers will provide services

20 under this section directly or through contract.

21 ‘‘(2) In accordance with the order of selection

22 under section 103(b)(2), an integrated career center

23 system will, in expending amounts provided to the

24 center from a grant under section 101, carry out the

25 following:
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1 ‘‘(A) Make determinations under section

2 105 of the eligibility of individuals for voca3 tional rehabilitation services (as defined in sub4 section (b)).

5 ‘‘(B) Provide for vocational rehabilitation

6 services for eligible individuals.

7 ‘‘(C) In the case of individuals with severe

8 disabilities, conduct outreach and intake activi9 ties for such individuals who are not able to di10 rectly access the integrated career center sys11 tem because of the nature of their disabilities.

12 ‘‘(3) An integrated career center system will, in

13 expending amounts provided to the center from a

14 grant under section 101, make vocational rehabilita15 tion services available at a variety of locations and,

16 as appropriate for particular populations, in a vari17 ety of environments.

18 ‘‘(b) DEFINITION.—For purposes of this title, the

19 term ‘vocational rehabilitation services’ means such goods

20 or services for eligible individuals as are—

21 ‘‘(1) necessary to render the individuals employ22 able and achieve an employment outcome; and

23 ‘‘(2) provided in response to needs that arise, to

24 a significant extent, from the disability involved and

25 do not duplicate, to any significant extent, the core
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1 services available under title I of the Consolidated

2 and Reformed Education, Employment, and Reha3 bilitation Systems Act.

4 ‘‘(c) CERTAIN SERVICES.—For purposes of section

5 101(a), the vocational rehabilitation services available

6 through integrated career center systems will include the

7 following:

8 ‘‘(1) An assessment of the needs of eligible indi9 viduals for such services.

10 ‘‘(2) Development, in accordance with section

11 105(b)(2), of an individualized rehabilitation and

12 employment plan for the purpose of identifying em13 ployment goals, appropriate intermediate rehabilita14 tion objectives, and an appropriate combination of

15 goods and services for the individual to achieve the

16 employment goals.

17 ‘‘(3) Counseling, guidance, and work-related

18 placement services for individuals with disabilities,

19 including job search assistance, placement assist20 ance, job retention services, personal assistance serv21 ices, and follow-up, follow-along, and specific

22 postemployment services necessary to assist such in23 dividuals to maintain, regain, or advance in employ24 ment.
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1 ‘‘(4) Vocational and other training services for

2 individuals with disabilities, including personal and

3 vocational adjustment, books, or other training ma4 terials, and such services to the families of such in5 dividuals as are necessary to the adjustment or reha6 bilitation of such individuals.

7 ‘‘(5) Rehabilitation technology services.

8 ‘‘(6) Supported employment services.

9 ‘‘(7) Physical and mental restoration services.

10 ‘‘(8) Interpreter services for individuals who are

11 deaf, and reader services for individuals who are

12 blind.

13 ‘‘(9) Rehabilitation teaching services and ori14 entation and mobility services for individuals who

15 are blind.

16 ‘‘(10) Referral and other services designed to

17 assist individuals with disabilities in securing needed

18 services from other agencies through agreements de19 veloped under section 103(b)(10), if such services

20 are not available under this Act.

21 ‘‘(11) Transportation in connection with the

22 rendering of any vocational rehabilitation service.

23 ‘‘(12) Telecommunications, sensory, and other

24 technological aids and devices.
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1 ‘‘(13) On-the-job, or other related personal-as2 sistance services, provided while eligible individuals

3 are receiving other vocational rehabilitation services

4 under this title.

5 ‘‘(d) CERTAIN ARRANGEMENTS.—For purposes of

6 section 101(a), an integrated career center system will,

7 with respect to the provision of vocational rehabilitation

8 services to individuals with the most severe disabilities,

9 provide for necessary arrangements with community-based

10 providers, including arrangements regarding supported

11 employment services and extended services, periodic re12 views of individuals placed in extended employment, and

13 services to promote movement from extended employment

14 to integrated employment.

15 ‘‘(e) OPTIONAL PROVISION OF OTHER SERVICES.—

16 For purposes of this title, an integrated career center sys17 tem may provide such vocational rehabilitation services in

18 addition to the services specified in subsection (c) as the

19 center determines to be appropriate.

20 ‘‘(f) ALLOCATION FOR CORE SERVICES.—For pur21 poses of section 101(a):

22 ‘‘(1) With respect to a fiscal year, a local

23 workforce development board receiving amounts

24 from a grant under section 101 will reserve an

25 amount for the provision of core services under title
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1 I of the Consolidated and Reformed Education, Em2 ployment, and Rehabilitation Systems Act.

3 ‘‘(2) The amount so reserved will be based on

4 the number of eligible individuals with disabilities in

5 the local workforce development area and the costs

6 of training employees of the integrated career center

7 system to provide high-quality services to individuals

8 with disabilities.

9 ‘‘(g) PERFORMANCE PAYMENTS REGARDING CAREER

10 GRANTS.—For purposes of section 101(a):

11 ‘‘(1) The local workforce development board in12 volved will ensure that, in providing for the payment

13 of services provided pursuant to career grants, a

14 portion of the total payment is withheld from the

15 provider until the delivery of the services involved is

16 completed in reasonable accordance with the out17 come designated for the service pursuant to a prior

18 understanding with the provider.

19 ‘‘(2) In the case of education, training, and

20 placement services that are designed to lead to an

21 employment outcome, a portion of the total payment

22 will be withheld from the provider until—

23 ‘‘(A) the participant has successfully com24 pleted the training; and
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1 ‘‘(B) the participant has been employed,

2 and has retained employment for a period of

3 not less than 90 days.

4 ‘‘(h) PAYOR OF LAST RESORT REGARDING MEDICAL

5 SERVICES AND EDUCATIONAL ASSISTANCE.—For pur6 poses of section 101(a), a State will not expend a grant

7 under section 101 to pay for training services in institu8 tions of higher education, or to pay for medical services,

9 unless significant efforts have been made to secure pay10 ments, in whole or in part, from other sources, except that

11 such efforts are not required if making the efforts would

12 delay the provision of such services to any eligible individ13 ual who is at extreme medical risk, or if making the efforts

14 would result in the loss of a job placement that (but for

15 the efforts) would be immediately available to an eligible

16 individual.

17 ‘‘SEC. 105. ELIGIBLE INDIVIDUAL.

18 ‘‘(a) IN GENERAL.—For purposes of section 101:

19 ‘‘(1) An individual will not receive vocational re20 habilitation services under this title unless the indi21 vidual—

22 ‘‘(A) is an individual with a disability

23 under section 7(8)(A); and
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1 ‘‘(B) requires vocational rehabilitation

2 services to prepare for, enter, engage in, or re3 tain gainful employment.

4 ‘‘(2) If the individual has a disability or is blind

5 as determined pursuant to title II or title XVI of the

6 Social Security Act, the individual will be considered

7 to have—

8 ‘‘(A) a physical or mental impairment

9 which for such individual constitutes or results

10 in a substantial impediment to employment

11 under section 7(8)(A)(i); and

12 ‘‘(B) a severe physical or mental impair13 ment which seriously limits one or more func14 tional capacities in terms of an employment

15 outcome under section 7(15)(A)(i).

16 ‘‘(3) It will be presumed that an individual can

17 benefit in terms of an employment outcome from vo18 cational rehabilitation services for purposes of sec19 tion 7(8)(A)(ii), unless the integrated career center

20 system involved can demonstrate by clear and con21 vincing evidence that such individual is incapable of

22 benefiting from vocational rehabilitation services in

23 terms of an employment outcome.

24 ‘‘(b) PROCESS.—For purposes of section 101(a), a

25 State will ensure that, subject to the order of selection
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1 under section 102(b)(2), the following applies to an indi2 vidual:

3 ‘‘(1) Once the individual makes a request in

4 person for a determination of eligibility:

5 ‘‘(A) A qualified rehabilitation adviser will

6 be made available to the individual regarding

7 the process of obtaining services under this

8 title.

9 ‘‘(B) An initial interview will be conducted,

10 followed by an initial assessment.

11 ‘‘(C) A final determination will be made

12 not later than 30 days after the request (sub13 ject to the cooperation of the individual in the

14 process of determination).

15 ‘‘(D) The determination of eligibility will

16 be based on the review of existing data de17 scribed in clause (i) of section 7(22)(A), and, to

18 the extent necessary, the preliminary assess19 ment described in clause (ii) of such section.

20 ‘‘(E) If it is determined that the individual

21 is not an eligible individual, the individual will

22 be provided a written statement explaining the

23 following:

24 ‘‘(i) The basis of the determination.
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1 ‘‘(ii) The availability of impartial re2 view under section 103(b)(7).

3 ‘‘(iii) The availability of services

4 under the client assistance program under

5 section 510.

6 ‘‘(2)(A) If it is determined that the individual

7 is an eligible individual—

8 ‘‘(i) the needs of the individual for voca9 tional rehabilitation services will be assessed;

10 and

11 ‘‘(ii) subject to subparagraph (D), an indi12 vidualized rehabilitation and employment plan

13 will be developed for the individual regarding

14 the provision of services pursuant to clause (i).

15 ‘‘(B) The plan under subparagraph (A) will be

16 developed and mutually agreed upon by the individ17 ual and an appropriate staff member of the inte18 grated career center system involved.

19 ‘‘(C) A plan under subparagraph (A) is individ20 ualized if the plan is consistent with the unique

21 strengths, resources, priorities, concerns, abilities,

22 and capabilities of the individual for whom the plan

23 is developed.
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1 ‘‘(D) A plan under subparagraph (A) is not re2 quired for an individual if the individual signs a

3 waiver stating that such a plan is not necessary for

4 the individual.

5 ‘‘(c) RULE OF CONSTRUCTION.—This title may not

6 be construed as establishing an entitlement in any individ7 ual.

8 ‘‘(d) DEFINITION.—For purposes of this title, the

9 term ‘eligible individual’ means an individual described in

10 subsection (a)(1).

11 ‘‘SEC. 106. STATE REHABILITATION ADVISORY COUNCIL.

12 ‘‘(a) IN GENERAL.—For purposes of section 101(a):

13 ‘‘(1) A State will establish a State Rehabilita14 tion Advisory Council (referred to in this section as

15 the ‘Council’) in accordance with this section.

16 ‘‘(2) The Council will be composed of the fol17 lowing:

18 ‘‘(A) Representatives of organizations with19 in the State providing services to individuals

20 with disabilities and their families, including

21 representatives of the client assistance program

22 under section 510.

23 ‘‘(B) Representatives of business, industry,

24 and labor.
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1 ‘‘(C) Representatives of disability advocacy

2 groups representing a cross section of—

3 ‘‘(i) individuals with physical, cog4 nitive, sensory, and mental disabilities; and

5 ‘‘(ii) parents, family members, guard6 ians, advocates, or authorized representa7 tives, of individuals with disabilities who

8 have difficulty in representing themselves

9 or are unable due to their disabilities to

10 represent themselves.

11 ‘‘(3) The State administrative agent will be an

12 ex officio member of the Council.

13 ‘‘(4) Members of the Council will be appointed

14 by the Governor or another entity that has appoint15 ment authority under State law.

16 ‘‘(5) A majority of Council members will be per17 sons who are—

18 ‘‘(A) individuals with disabilities described

19 in section 7(8)(B); and

20 ‘‘(B) not employed by the designated State

21 administrative agent.

22 ‘‘(6)(A) Except as provided in subparagraph

23 (B), the Council will select a chairperson from

24 among the membership of the Council.
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1 ‘‘(B) In States in which the Governor does not

2 have veto power pursuant to State law, the Governor

3 will designate a member of the Council to serve as

4 the chairperson of the Council or will require the

5 Council to so designate such a member.

6 ‘‘(7) Each member of the Council will serve for

7 a term determined by the Governor or another entity

8 that has appointment authority under State law.

9 ‘‘(8) Any vacancy occurring in the membership

10 of the Council will be filled in the same manner as

11 the original appointment. The vacancy will not affect

12 the power of the remaining members to execute the

13 duties of the Council.

14 ‘‘(b) FUNCTIONS OF COUNCIL.—For purposes of sec15 tion 101(a), the Council will carry out the following:

16 ‘‘(1) Advise the collaborative process under sec17 tion 103 of the Consolidated and Reformed Edu18 cation, Employment, and Rehabilitation Systems

19 Act, and the State administrative agent, in the prep20 aration of the State workforce development and lit21 eracy plan and other plans, reports, needs assess22 ments, and evaluations required by this title.

23 ‘‘(2) To the extent feasible, conduct a review

24 and analysis of the effectiveness of, and consumer

25 satisfaction with, the delivery of core services and
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1 vocational rehabilitation services to individuals with

2 disabilities within the State.

3 ‘‘(3) Prepare and submit an annual report to

4 the collaborative process or appropriate State admin5 istrative agent and the Commissioner on the status

6 of vocational rehabilitation programs operated within

7 the State, and make the report available to the pub8 lic.

9 ‘‘(4) Coordinate with other councils within the

10 State established to address the needs of individuals

11 with disabilities.

12 ‘‘(5) Perform such other functions, consistent

13 with the purpose of this title, as the State Rehabili14 tation Advisory Council determines to be appro15 priate, that are comparable to the other functions

16 performed by the Council.

17 ‘‘(c) RESOURCES.—

18 ‘‘(1) PLAN.—For purposes of section 101(a),

19 the Council will prepare, in conjunction with the

20 State administrative agent, a plan for the provision

21 of such resources, including such staff and other

22 personnel, as may be necessary to carry out the

23 functions of the Council under this section. The re24 source plan shall, to the maximum extent possible,
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1 rely on the use of resources in existence during the

2 period of implementation of the plan.

3 ‘‘(2) RESOLUTION OF DISAGREEMENTS.—For

4 purposes of section 101(a), to the extent that there

5 is a disagreement between the Council and the State

6 administrative agent in regard to the resources nec7 essary to carry out the functions of the Council as

8 set forth in this section, the disagreement will be re9 solved by the Governor or appointing agency identi10 fied in subsection (a)(4).

11 ‘‘(3) SUPERVISION AND EVALUATION.—For

12 purposes of section 101(a), the Council will, consist13 ent with State law, supervise and evaluate such staff

14 and other personnel as may be necessary to carry

15 out its functions under this section.

16 ‘‘(4) PERSONNEL CONFLICT OF INTEREST.—

17 For purposes of section 101(a), while assisting the

18 Council in carrying out its duties, staff and other

19 personnel will not be assigned duties by the State

20 administrative agent or any other agency or office of

21 the State, that would create a conflict of interest.

22 ‘‘(d) CONFLICT OF INTEREST.—For purposes of sec23 tion 101(a), no member of the Council will cast a vote

24 on any matter that would provide direct financial benefit
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1 to the member or otherwise give the appearance of a con2 flict of interest under State law.

3 ‘‘(e) MEETINGS.—For purposes of section 101(a), the

4 Council will convene meetings and conduct such forums

5 or hearings as the Council considers appropriate. The

6 meetings, hearings, and forums will be publicly an7 nounced. The meetings will be open and accessible to the

8 general public unless there is a valid reason for an execu9 tive session.

10 ‘‘(f) COMPENSATION AND EXPENSES.—For purposes

11 of section 101(a), the Council may use funds appropriated

12 under this title to reimburse members of the Council for

13 reasonable and necessary expenses of attending Council

14 meetings and performing Council duties (including child

15 care and personal assistance services), and to pay com16 pensation to a member of the Council, if such member is

17 not employed or must forfeit wages from other employ18 ment, for each day the member is engaged in performing

19 the duties of the Council.

20 ‘‘(g) RULE OF CONSTRUCTION.—Nothing in this sec21 tion prohibits a State from establishing and providing

22 funds to a separate council to carry out functions de23 scribed in subsection (b) with respect to vocational reha24 bilitation services for individuals who are blind.
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1 ‘‘SEC. 107. AMOUNT OF ALLOTMENT.

2 ‘‘(a)(1) Subject to the provisions of subsection (d),

3 for each fiscal year beginning before October 1, 1978, each

4 State shall be entitled to an allotment of an amount bear5 ing the same ratio to the amount authorized to be appro6 priated under section 101(d) for allotment under this sec7 tion as the product of (A) the population of the State,

8 and (B) the square of its allotment percentage, bears to

9 the sum of the corresponding products for all the States.

10 ‘‘(2)(A) For each fiscal year beginning on or after

11 October 1, 1978, each State shall be entitled to an allot12 ment in an amount equal to the amount such State re13 ceived under paragraph (1) for the fiscal year ending Sep14 tember 30, 1978, and an additional amount determined

15 pursuant to subparagraph (B) of this paragraph.

16 ‘‘(B) For each fiscal year beginning on or after Octo17 ber 1, 1978, each State shall be entitled to an allotment,

18 from any amount authorized to be appropriated for such

19 fiscal year under section 101(d) for allotment under this

20 section in excess of the amount appropriated under such

21 section for the fiscal year ending September 30, 1978, in

22 an amount equal to the sum of—

23 ‘‘(i) an amount bearing the same ratio to 50

24 percent of such excess amount as the product of the

25 population of the State and the square of its allot-
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1 ment percentage bears to the sum of the correspond2 ing products for all the States; and

3 ‘‘(ii) an amount bearing the same ratio to 50

4 percent of such excess amount as the product of the

5 population of the State and its allotment percentage

6 bears to the sum of the corresponding products for

7 all the States.

8 ‘‘(3) The sum of the payment to any State (other

9 than Guam, American Samoa, the Virgin Islands, and the

10 Northern Mariana Islands) under this subsection for any

11 fiscal year which is less than one-third of 1 percent of the

12 amount appropriated under section 101(d), or $3,000,000,

13 whichever is greater, shall be increased to that amount,

14 the total of the increases thereby required being derived

15 by proportionately reducing the allotment to each of the

16 remaining such States under this subsection, but with

17 such adjustments as may be necessary to prevent the sum

18 of the allotments made under this subsection to any such

19 remaining State from being thereby reduced to less than

20 that amount.

21 ‘‘(4) For each fiscal year beginning on or after Octo22 ber 1, 1984, for which any amount is appropriated pursu23 ant to section 101(d), each State shall receive an alloca24 tion (from such appropriated amount) in addition to the

25 allotment to which such State is entitled under paragraphs
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1 (2) and (3) of this subsection. Such additional allocation

2 shall be an amount which bears the same ratio to the

3 amount so appropriated as that State’s allotment under

4 paragraphs (2) and (3) of this subsection bears to the sum

5 of such allotments of all the States.

6 ‘‘(b)(1) If the payment to a State pursuant to this

7 section for a fiscal year is less than the total payments

8 such State received under section 2 of the Rehabilitation

9 Act for the fiscal year ending June 30, 1973, such State

10 shall be entitled to an additional payment (subject to the

11 same terms and conditions applicable to other payments

12 under this title) equal to the difference between the pay13 ment under this section and the amount so received by

14 it.

15 ‘‘(2) If a State receives as its Federal share pursuant

16 to this section for any fiscal year less than the applicable

17 Federal share of the expenditure of such State for fiscal

18 year 1972 for vocational rehabilitation services under the

19 plan for such State approved under section 101 as in ef20 fect for such year (including any amount expended by such

21 State for the administration of the State plan but exclud22 ing any amount expended by such State from non-Federal

23 sources for construction under such plan), such State shall

24 be entitled to an additional payment for such fiscal year,

25 subject to the same terms and conditions applicable to
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1 other payments under this title, equal to the difference

2 between such payment pursuant to this section and an

3 amount equal to the applicable Federal share of such ex4 penditure for vocational rehabilitation services.

5 ‘‘(3) Any payment attributable to the additional pay6 ment to a State under this subsection shall be made only

7 from appropriations specifically made to carry out this

8 subsection, and such additional appropriations are hereby

9 authorized.

10 ‘‘SEC. 108. STATE OPTION FOR WAIVERS REGARDING AL11 TERNATIVE DELIVERY SYSTEMS.

12 ‘‘(a) IN GENERAL.—In the case of the requirements

13 specified in subsection (b), the Secretary shall provide to

14 a State a waiver of such requirements as the State elects,

15 if (subject to the other provisions of this section) the fol16 lowing conditions are met:

17 ‘‘(1) The Governor, through the collaborative

18 process under section 103 of the Consolidated and

19 Reformed Education, Employment, and Rehabilita20 tion Systems Act, develops a proposed plan for alter21 native approaches (to be implemented by the State

22 in lieu of the requirements involved).

23 ‘‘(2) The proposal is approved by each local

24 workforce development board in whose local
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1 workforce development area the proposal (or any

2 component of the proposal) is to be effective.

3 ‘‘(3) The local workforce development boards

4 involved, and the Governor, determine that the fol5 lowing conditions have been met:

6 ‘‘(A) The proposal will better fulfill the

7 purposes of this title than would compliance

8 with the requirements involved.

9 ‘‘(B) In the development of the alternative

10 approaches, the public was afforded a reason11 able opportunity to comment on the proposed

12 alternative approaches.

13 ‘‘(4) The Governor submits to the Secretary the

14 following documents:

15 ‘‘(A) A notification that the State is elect16 ing to receive a waiver under this section.

17 ‘‘(B) A copy of the plan involved.

18 ‘‘(C) Such documents as the Secretary

19 may require for purposes of verifying that the

20 conditions established in paragraphs (1)

21 through (3) have been met.

22 ‘‘(b) CERTAIN REQUIREMENTS REGARDING STATE

23 ADMINISTRATIVE STRUCTURE FOR DELIVERY OF SERV24 ICES.—The requirements referred to in subsection (a) are

25 as follows:
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1 ‘‘(1) The allocation under section 102 of

2 amounts between State administrative agents and

3 local workforce development boards.

4 ‘‘(2) The allocation under sections 103 and 104

5 of responsibilities between State administrative

6 agents and local workforce development boards (in7 cluding the use of integrated career center systems

8 to provide vocational rehabilitation services).

9 ‘‘(3) The specification under section 103(a) of

10 the State officials who are to administer the require11 ments of section 103.

12 ‘‘(c) APPLICABILITY OF WAIVER; REVIEW AND REVI13 SION OF PLAN.—

14 ‘‘(1) APPLICABILITY.—A waiver under sub15 section (a) is effective for a fiscal year only if the

16 documents under paragraph (4) of such subsection

17 are submitted to the Secretary not later than 60

18 days before the beginning of the fiscal year.

19 ‘‘(2) REVIEW OF PLAN.—A waiver under sub20 section (a) is effective for such fiscal years as the

21 State involved elects, except that, not less than once

22 during each period of three fiscal years, the plan

23 under the waiver is required (as a condition of the

24 waiver remaining in effect) to be reviewed, and ap25 proved, by the Governor (through the collaborative
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1 process referred to in such subsection) and by the

2 local workforce development boards involved.

3 ‘‘(3) REVISION OF PLAN.—The plan under a

4 waiver under subsection (a) may be revised. Such

5 subsection applies to such a revision to the same ex6 tent and in the same manner as the subsection ap7 plies to the original plan.

8 ‘‘(d) PERFORMANCE ACCOUNTABILITY SYSTEM.—A

9 waiver under subsection (a) for a State does not, with re10 spect to carrying out the program under this title in the

11 State, affect the applicability to the State of section 110

12 of the Consolidated and Reformed Education, Employ13 ment, and Rehabilitation Systems Act.’’.

14 (b) CERTAIN FUNDING PROVISION.—Effective Octo15 ber 1, 1995, the Rehabilitation Act of 1973 (29 U.S.C.

16 701 et seq.) is amended by inserting after section 3 the

17 following section:

18 ‘‘AVAILABILITY OF FUNDS

19 ‘‘SEC. 3A. Notwithstanding any other provision of

20 law, funding to carry out titles II through VII for any

21 fiscal year is available only to such extent and in such

22 amounts as may be provided in advance in appropriations

23 Acts.’’.

24 (c) CONFORMING AMENDMENTS.—Effective October

25 1, 1995, the Rehabilitation Act of 1973 (29 U.S.C. 701
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1 et seq.) is amended in the table of contents in the first

2 section—

3 (1) by inserting after the item relating to sec4 tion 3 the following item:

‘‘Sec. 3A. Availability of funds.’’;

5 (2) by striking the items relating to sections

6 100 through 109, to sections 110 through 112, to

7 sections 120 through 124, to section 130, and to

8 sections 140 and 141;

9 (3) by striking the items relating to the title

10 designation and heading for title I, and to the part

11 designations and headings for parts A, B, C, D, and

12 E of title I;

13 (4) by inserting after the item relating to sec14 tion 21 the following items:

‘‘TITLE I—VOCATIONAL REHABILITATION SERVICES

‘‘Sec. 100. Purpose.

‘‘Sec. 101. Formula grants.

‘‘Sec. 102. Allocation within State of administrative responsibilities.

‘‘Sec. 103. Responsibilities of State administrative agent.

‘‘Sec. 104. Responsibilities for local boards and service centers.

‘‘Sec. 105. Eligible individual.

‘‘Sec. 106. State Rehabilitation Advisory Council.

‘‘Sec. 107. Amount of allotment.

‘‘Sec. 108. State option for waivers regarding alternative delivery systems.’’;

and

15 (5) by inserting after the item relating to sec16 tion 509 the following item:

‘‘Sec. 510. Client assistance program.’’.
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1 Subtitle B—Other Amendments to

2 Rehabilitation Act of 1973

3 SEC. 521. TRAINING AND DEMONSTRATION PROJECTS.

4 (a) IN GENERAL.—Effective October 1, 1995, the

5 Rehabilitation Act of 1973 (29 U.S.C. 701 et seq.) is

6 amended—

7 (1) in title III—

8 (A) by striking section 303;

9 (B) by striking section 304;

10 (C) in section 311—

11 (i) by striking subsections (c) and (f);

12 and

13 (ii) by redesignating subsections (d)

14 and (e) as subsections (c) and (d), respec15 tively;

16 (D) by striking section 312; and

17 (E) by striking section 316;

18 (2)(A) by transferring subsection (a) of section

19 802 from the current placement of the subsection;

20 (B) by redesignating such subsection as sub21 section (e); and

22 (C) by inserting such subsection at the end of

23 section 311 (as amended by paragraph (1)(C) of this

24 subsection);
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1 (3)(A) by transferring subsection (g) of section

2 802 from the current placement of the subsection;

3 (B) by redesignating such subsection as sub4 section (f); and

5 (C) by inserting such subsection at the end of

6 section 311 (as amended by paragraph (2)(C) of this

7 subsection);

8 (4)(A) by transferring subsection (c) of section

9 803 from the current placement of the subsection;

10 (B) by redesignating such subsection as sub11 section (g); and

12 (C) by inserting such subsection at the end of

13 section 311 (as amended by paragraph (3)(C) of this

14 subsection);

15 (5)(A) by transferring subsection (b) of section

16 803 from the current placement of the subsection;

17 (B) by redesignating such subsection as sub18 section (j); and

19 (C) by inserting such subsection at the end of

20 section 302; and

21 (6) by striking the remaining provisions of title

22 VIII.

23 (b) CONFORMING AMENDMENTS.—Effective October

24 1, 1995, the Rehabilitation Act of 1973 (29 U.S.C. 701
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1 et seq.) is amended in the table of contents in the first

2 section—

3 (1) by striking the items relating to sections

4 303, 304, 312, and 316;

5 (2) by striking the items relating to sections

6 801 through 803 of title VIII; and

7 (3) by striking the item relating to the title des8 ignation and heading for title VIII.

9 SEC. 522. EMPLOYMENT OPPORTUNITIES FOR INDIVIDUALS

10 WITH DISABILITIES.

11 (a) IN GENERAL.—Effective October 1, 1995, title VI

12 of the Rehabilitation Act of 1973 (29 U.S.C. 795 et seq.)

13 is amended—

14 (1) by striking part A;

15 (2) by striking part C;

16 (3) by striking part D; and

17 (4) in part B, by striking the part designation

18 and heading.

19 (b) PROJECTS WITH INDUSTRY.—Effective October

20 1, 1998, title VI of the Rehabilitation Act of 1973, as

21 amended by subsection (a) of this section, is repealed.

22 (c) CONFORMING AMENDMENTS.—Effective October

23 1, 1995, the Rehabilitation Act of 1973 (29 U.S.C. 701

24 et seq.) is amended in the table of contents in the first

25 section by striking the items relating to sections 611
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1 through 617, to sections 631 through 638, and to section

2 641; and by striking the items relating to the part des3 ignations and headings for parts A, B, C, and D of title

4 VI. Effective October 1, 1998, such table of contents is

5 amended by striking the items relating to sections 621

6 through 623; and by striking the item relating to the title

7 designation and heading for title VI.

8 SEC. 523. CERTAIN AMOUNTS.

9 (a) AMOUNTS REGARDING FISCAL YEAR 1996.—

10 With respect to the aggregate amount that was available

11 for fiscal year 1995 as direct spending for carrying out

12 the programs under section 311(c), section 316, and part

13 C of title VI of the Rehabilitation Act of 1973 (as such

14 provisions were in effect for such fiscal year), an amount

15 equal to such aggregate amount is hereby made available

16 for fiscal year 1996 as direct spending for carrying out

17 title I of such Act (in addition to the amount of direct

18 spending that otherwise is available for such title I for

19 fiscal year 1996).

20 (b) AMOUNTS REGARDING FISCAL YEAR 1999.—

21 With respect to the amount made available in appropria22 tions Act for fiscal year 1998 for carrying out title VI

23 of the Rehabilitation Act of 1973 (as such title was in

24 effect for such fiscal year), an amount equal to such

25 amount is hereby made available for fiscal year 1999 as
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1 direct spending for carrying out title I of such Act (in

2 addition to the amount of direct spending that otherwise

3 is available for such title I for fiscal year 1999).

4 TITLE VI—HIGHER EDUCATION

5 PRIVATIZATION

6 SEC. 601. REORGANIZATION OF THE STUDENT LOAN MAR7 KETING ASSOCIATION THROUGH THE FOR8 MATION OF A HOLDING COMPANY.

9 (a) AMENDMENT.—Part B of title IV of the Higher

10 Education Act of 1965 (20 U.S.C. 1071 et seq.) is amend11 ed by inserting after section 439 (20 U.S.C. 1087–2) the

12 following new section:

13 ‘‘SEC. 440. REORGANIZATION OF THE STUDENT LOAN MAR14 KETING ASSOCIATION THROUGH THE FOR15 MATION OF A HOLDING COMPANY.

16 ‘‘(a) ACTIONS BY THE ASSOCIATION’S BOARD OF DI17 RECTORS.—The Board of Directors of the Association

18 shall take or cause to be taken all such action as it deems

19 necessary or appropriate to effect, upon the shareholder

20 approval described in subsection (b), a restructuring of the

21 common stock ownership of the Association, as set forth

22 in a plan of reorganization adopted by the Board of Direc23 tors (the terms of which shall be consistent with this Act)

24 so that all of the outstanding common shares shall be di25 rectly owned by an ordinary business corporation char-
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1 tered under State or District of Columbia law (the ‘Hold2 ing Company’), as the Board of Directors may determine.

3 Such actions may include, in the Board’s discretion, a

4 merger of a wholly owned subsidiary of the Holding Com5 pany with and into the Association, which would have the

6 effect provided in the plan of reorganization and the law

7 of the jurisdiction in which such subsidiary is incor8 porated. As part of the restructuring, the Board of Direc9 tors may cause (1) the common shares of the Association

10 to be converted, at the reorganization effective date, to

11 common shares of the Holding Company on a one for one

12 basis, consistent with applicable State or District of Co13 lumbia law, and (2) Holding Company common shares to

14 be registered with the Securities and Exchange Commis15 sion.

16 ‘‘(b) SHAREHOLDER APPROVAL.—The plan of reor17 ganization adopted by the Board of Directors pursuant to

18 subsection (a) shall be submitted to common stockholders

19 of the Association for their approval. The reorganization

20 shall occur at the reorganization effective date, provided

21 that the plan of reorganization has been approved by the

22 affirmative votes, cast in person or by proxy, of the holders

23 of a majority of the issued and outstanding shares of the

24 Association common stock.

25 ‘‘(c) TRANSITION.—
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1 ‘‘(1) IN GENERAL.—Except as specifically pro2 vided in this section, until the dissolution date the

3 Association shall continue to have all of the rights,

4 privileges and obligations set forth in, and shall be

5 subject to all of the limitations and restrictions of,

6 section 439 of this Act as in effect on the effective

7 date of this section, and the Association shall con8 tinue to carry out the purposes of such section. The

9 Holding Company and its affiliates other than the

10 Association shall not be entitled to any of the rights,

11 privileges and obligations, and shall not be subject to

12 the limitations and restrictions, applicable to the As13 sociation under section 439 of this Act as in effect

14 on the effective date of this section, except as spe15 cifically provided in this section. The Holding Com16 pany and its subsidiaries (other than the Associa17 tion) shall not purchase loans insured under this Act

18 until such time as the Association ceases acquiring

19 such loans, except that the Association shall con20 tinue to acquire loans as a lender of last resort pur21 suant to section 439(q) of this Act or under an

22 agreement with the Secretary described in section

23 440(c)(6).

24 ‘‘(2) TRANSFER OF CERTAIN PROPERTY.—Ex25 cept as specifically provided in this section, at the
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1 reorganization effective date or as soon as prac2 ticable thereafter, the Association shall use its best

3 efforts to transfer to the Holding Company or its

4 subsidiaries (or both), in each case, as directed by

5 the Holding Company, all real and personal property

6 of the Association (both tangible and intangible)

7 other than the remaining property. Without limiting

8 the preceding sentence, such transferred property

9 shall include all right, title and interest in (A) direct

10 or indirect subsidiaries of the Association (excluding

11 any interest in any government sponsored enter12 prise), (B) contracts, leases, and other agreements,

13 (C) licenses and other intellectual property, and (D)

14 any other property of the Association. Notwithstand15 ing the preceding provisions of this paragraph, noth16 ing in this paragraph shall be construed to prohibit

17 the Association from transferring remaining prop18 erty from time to time to the Holding Company or

19 its subsidiaries, subject to the provisions of para20 graph (4).

21 ‘‘(3) TRANSFER OF PERSONNEL.—At the reor22 ganization effective date, employees of the Associa23 tion shall become employees of the Holding Com24 pany (or of the subsidiaries), and the Holding Com25 pany (or the subsidiaries or both) shall provide all
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1 necessary and appropriate management and oper2 ational support (including loan servicing) to the As3 sociation, as requested by the Association. The Asso4 ciation may, however, obtain such management and

5 operational support from other persons or entities.

6 ‘‘(4) DIVIDENDS.—The Association may pay

7 dividends in the form of cash or noncash distribu8 tions so long as at the time of the declaration of

9 such dividends, after giving effect to the payment of

10 such dividends as of the date of such declaration by

11 the Board of Directors of the Association, the Asso12 ciation’s capital would be in compliance with the

13 capital standards set forth in section 439(r) of this

14 Act. If, at any time after the reorganization effective

15 date, the Association fails to comply with such cap16 ital standards, the Holding Company shall be obli17 gated to transfer to the Association additional cap18 ital in such amounts as are necessary to ensure that

19 the Association again complies with the capital

20 standards.

21 ‘‘(5) VALUATION OF NONCASH DISTRIBU22 TIONS.—After the reorganization effective date, any

23 distribution of noncash assets by the Association to

24 the Holding Company shall be valued at book value

25 on the date the Association’s Board of Directors ap-
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1 proved such distribution for purposes of calculating

2 compliance with section 439(r) of this Act.

3 ‘‘(6) RESTRICTIONS ON NEW BUSINESS ACTIV4 ITY OR ACQUISITION OF ASSETS BY ASSOCIATION.—

5 After the reorganization effective date, the Associa6 tion shall not engage in any new business activities

7 or acquire any additional program assets described

8 in section 439(d) of the Act other than—

9 ‘‘(A) in connection with (i) student loan

10 purchases through September 30, 2003, and (ii)

11 contractual commitments for future

12 warehousing advances or pursuant to letters of

13 credit or standby bond purchase agreements

14 which are outstanding as of the reorganization

15 effective date;

16 ‘‘(B) in connection with its serving as a

17 lender-of-last-resort pursuant to section 439 of

18 this Act; and

19 ‘‘(C) in connection with its purchase of

20 loans insured under this part, if the Secretary,

21 with the approval of the Secretary of the Treas22 ury, enters into an agreement with the Associa23 tion for the continuation or resumption of its

24 secondary market purchase program because
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1 the Secretary determines there is inadequate li2 quidity for loans made under this part.

3 The Secretary is authorized to enter into an agree4 ment described in subparagraph (C) with the Asso5 ciation covering such secondary market activities.

6 Any agreement entered into under subparagraph (C)

7 shall cover a period of 12 months, but may be re8 newed if the Secretary determines that liquidity re9 mains inadequate. The fee provided under section

10 439(h)(7) shall not apply to loans acquired under

11 any such agreement with the Secretary.

12 ‘‘(7) ISSUANCE OF DEBT OBLIGATIONS DURING

13 THE TRANSITION PERIOD; ATTRIBUTES OF DEBT OB14 LIGATIONS.—After the reorganization effective date,

15 the Association shall not issue debt obligations which

16 mature later than September 30, 2007, except in

17 connection with serving as a lender-of-last-resort

18 pursuant to section 439 of this Act or with purchas19 ing loans under an agreement with the Secretary as

20 described in paragraph (6) of this subsection. Noth21 ing in this subsection shall modify the attributes ac22 corded the debt obligations of the Association by sec23 tion 439, regardless of whether such debt obligations

24 are incurred prior to, or at any time following, the
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1 reorganization effective date or are transferred to a

2 trust in accordance with subsection (d).

3 ‘‘(8) MONITORING OF SAFETY AND SOUND4 NESS.—

5 ‘‘(A) OBLIGATION TO OBTAIN, MAINTAIN,

6 AND REPORT INFORMATION.—The Association

7 shall obtain such information and make and

8 keep such records as the Secretary of the

9 Treasury may from time to time prescribe con10 cerning (i) the financial risk to the Association

11 resulting from the activities of any of its associ12 ated persons, to the extent such activities are

13 reasonably likely to have a material impact on

14 the financial condition of the Association, in15 cluding its capital ratio, its liquidity, or its abil16 ity to conduct and finance its operations, and

17 (ii) the Association’s policies, procedures, and

18 systems for monitoring and controlling any

19 such financial risk. The Association’s obliga20 tions under this subsection with respect to any

21 associated person which is a third party servicer

22 (as defined in 34 C.F.R. 682.200(b)) shall be

23 limited to providing to the Secretary of the

24 Treasury copies of any reports or other infor25 mation provided to the Secretary of Education
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1 pursuant to 34 C.F.R. 682.200 et seq. The Sec2 retary of the Treasury may require summary

3 reports of such information to be filed no more

4 frequently than quarterly. For purposes of this

5 paragraph, the term ‘associated person’ shall

6 mean any person, other than a natural person,

7 directly or indirectly controlling, controlled by,

8 or under common control with the Association.

9 ‘‘(B) SEPARATE OPERATION OF CORPORA10 TIONS.—

11 ‘‘(i) The funds and assets of the Asso12 ciation shall at all times be maintained

13 separately from the funds and assets of the

14 Holding Company or any of its other sub15 sidiaries and may be used solely by the As16 sociation to carry out its purposes and to

17 fulfill its obligations.

18 ‘‘(ii) The Association shall maintain

19 books and records that clearly reflect the

20 assets and liabilities of the Association,

21 separate from the assets and liabilities of

22 the Holding Company or any of its other

23 subsidiaries.

24 ‘‘(iii) The Association shall maintain a

25 corporate office that is physically separate
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1 from any office of the Holding Company or

2 any of its subsidiaries.

3 ‘‘(iv) No director of the Association

4 that is appointed by the President pursu5 ant to section 439(c)(1)(A) may serve as a

6 director of the Holding Company.

7 ‘‘(v) At least one officer of the Asso8 ciation shall remain an officer solely of the

9 Association.

10 ‘‘(vi) Transactions between the Asso11 ciation and the Holding Company or its

12 other subsidiaries, including any loan serv13 icing arrangements, shall be on terms no

14 less favorable to the Association than the

15 Association could obtain from an unrelated

16 third party offering comparable services.

17 ‘‘(vii) The Association shall not extend

18 credit to the Holding Company or any of

19 its affiliates, nor guarantee or provide any

20 credit enhancement to any debt obligations

21 of the Holding Company or any of its af22 filiates.

23 ‘‘(viii) Any amounts collected on be24 half of the Association by the Holding

25 Company or any of its other subsidiaries
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1 with respect to the assets of the Associa2 tion, pursuant to a servicing contract or

3 other arrangement between the Association

4 and the Holding Company or any of its

5 other direct or indirect subsidiaries, shall

6 be collected solely for the benefit of the As7 sociation and shall be immediately depos8 ited by the Holding Company or such

9 other subsidiary to an account under the

10 sole control of the Association.

11 ‘‘(C) ENCUMBRANCE OF ASSETS.—Not12 withstanding any otherwise applicable Federal

13 or State law, rule, or regulation, or legal or eq14 uitable principle, doctrine, or theory to the con15 trary, under no circumstances shall the assets

16 of the Association be available or used to pay

17 claims or debts of or incurred by the Holding

18 Company. Nothing in this subparagraph shall

19 limit the right of the Association to pay divi20 dends not otherwise prohibited hereunder or

21 limit any liability of the Holding Company ex22 plicitly provided for in this part.

23 ‘‘(D) HOLDING COMPANY ACTIVITIES.—

24 After the reorganization effective date and prior

25 to the dissolution of the Association in accord-
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1 ance with section 440(d), Holding Company ac2 tivities shall be limited to ownership of the As3 sociation and any other subsidiaries. All busi4 ness activities shall be conducted through sub5 sidiaries.

6 ‘‘(9) ASSOCIATION BOARD OF DIRECTORS.—

7 Notwithstanding any other provision of part B of

8 this title, after the reorganization effective date, the

9 14 directors of the Association elected by the Asso10 ciation’s stockholders (which immediately after the

11 reorganization effective date shall be the Holding

12 Company) shall no longer be required to meet the

13 eligibility requirements set forth in section 439(c).

14 ‘‘(10) ISSUANCE OF STOCK WARRANTS.—At the

15 reorganization effective date, the Holding Company

16 shall issue to the Secretary of the Treasury 200,000

17 stock warrants, each entitling the holder of the stock

18 warrant to purchase from the Holding Company one

19 share of the registered common stock of the Holding

20 Company at any time on or before September 30,

21 2007. The exercise price for such warrants shall be

22 an amount equal to the average closing price of the

23 common stock of the Association for the 20 business

24 days prior to and including the date of enactment of

25 this section on the exchange or market which is then
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1 the primary exchange or market for the common

2 stock of the Association, subject to any adjustments

3 necessary to reflect the conversion of Association

4 common stock into Holding Company common stock

5 as part of the plan of reorganization approved by

6 the Association’s shareholders.

7 ‘‘(11) RESTRICTIONS ON TRANSFER OF ASSO8 CIATION SHARES AND BANKRUPTCY OF ASSOCIA9 TION.—After the reorganization effective date, the

10 Holding Company shall not sell, pledge, or otherwise

11 transfer the outstanding shares of the Association,

12 or agree to or cause the liquidation of the Associa13 tion or cause the Association to file a petition for

14 bankruptcy under title 11, United States Code, with15 out prior approval of the Secretary of the Treasury

16 and the Secretary of Education.

17 ‘‘(d) TERMINATION OF THE ASSOCIATION.—The As18 sociation shall dissolve, and its separate existence shall

19 terminate on September 30, 2007, after discharge of all

20 outstanding debt obligations and liquidation pursuant to

21 this subsection. The Association may dissolve pursuant to

22 this subsection prior to such date by notifying the Sec23 retary of Education and the Secretary of the Treasury of

24 its intention to dissolve, unless within 60 days of receipt

25 of such notice the Secretary of Education notifies the As-
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1 sociation that it continues to be needed to serve as a lend2 er of last resort pursuant to section 439(q) of this Act

3 or continues to be needed to purchase loans under an

4 agreement with the Secretary described in subsection

5 (c)(6) of this section. On the dissolution date, the Associa6 tion shall take the following actions:

7 ‘‘(1) ESTABLISHMENT OF A TRUST.—The Asso8 ciation shall, under the terms of an irrevocable trust

9 agreement in form and substance satisfactory to the

10 Secretary of the Treasury, the Association and the

11 appointed trustee, irrevocably transfer all remaining

12 obligations of the Association to the trust and irrev13 ocably deposit or cause to be deposited into such

14 trust, to be held as trust funds solely for the benefit

15 of holders of the remaining obligations, money or di16 rect noncallable obligations of the United States of

17 America or any agency thereof for which payment

18 the full faith and credit of the United States is

19 pledged, maturing as to principal and interest in

20 such amounts and at such times as are determined

21 by the Secretary of the Treasury to be sufficient,

22 without consideration of any significant reinvestment

23 of such interest, to pay the principal of, and interest

24 on, the remaining obligations in accordance with

25 their terms. To the extent the Association cannot
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1 provide money or qualifying obligations in the

2 amount required, the Holding Company shall be re3 quired to transfer money or qualifying obligations to

4 the trust in the amount necessary to prevent any de5 ficiency.

6 ‘‘(2) USE OF TRUST ASSETS.—All money, obli7 gations, or financial assets deposited into the trust

8 pursuant to this subsection shall be applied by the

9 trustee to the payment of the remaining obligations

10 assumed by the trust. Upon the fulfillment of the

11 trustee’s duties under the trust, any remaining as12 sets of the trust shall be transferred to the Holding

13 Company or its subsidiaries, or both, as directed by

14 the Holding Company.

15 ‘‘(3) OBLIGATIONS NOT TRANSFERRED TO THE

16 TRUST.—The Association shall make proper provi17 sion for all other obligations of the Association, in18 cluding the repurchase or redemption, or the making

19 of proper provision for the repurchase or redemp20 tion, of any preferred stock of the Association then

21 outstanding. Any obligations of the Association

22 which cannot be fully satisfied shall become liabil23 ities of the Holding Company as of the date of dis24 solution.
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1 ‘‘(4) TRANSFER OF REMAINING ASSETS.—After

2 compliance with paragraphs (1), and (3), the Asso3 ciation shall transfer to the Holding Company any

4 remaining assets of the Association.

5 ‘‘(e) OPERATION OF THE HOLDING COMPANY.—

6 ‘‘(1) HOLDING COMPANY BOARD OF DIREC7 TORS.—The number and composition of the Board

8 of Directors of the Holding Company shall be deter9 mined as set forth in the Holding Company’s charter

10 or like instrument (as amended from time to time)

11 or bylaws (as amended from time to time) and as

12 permissible under the laws of the jurisdiction of its

13 incorporation.

14 ‘‘(2) HOLDING COMPANY NAME.—The names of

15 the Holding Company and any subsidiary of the

16 Holding Company other than the Association—

17 ‘‘(A) may not contain the name ‘Student

18 Loan Marketing Association’; and

19 ‘‘(B) may contain, to the extent permitted

20 by applicable State or District of Columbia law,

21 ‘Sallie Mae’, or variations thereof or such other

22 names as the Board of Directors of the Associa23 tion of the Holding Company shall deem appro24 priate.
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1 ‘‘(3) USE OF SALLIE MAE NAME.—Without lim2 iting paragraph (2), the Association may assign to

3 the Holding Company, or any other subsidiary of the

4 Holding Company, the ‘Sallie Mae’ name as a trade5 mark and service mark, except that neither the

6 Holding Company nor any subsidiary of the Holding

7 Company other than the Association or a subsidiary

8 of the Association may use the ‘Sallie Mae’ name on,

9 or to identify the issuer of, any debt obligation or

10 other security offered or sold by the Holding Com11 pany or any such subsidiary. The Association shall

12 remit to the Secretary of Treasury $5,000,000 dur13 ing fiscal year 1996 as compensation for the right

14 to assign such trademark or service mark.

15 ‘‘(4) DISCLOSURE REQUIRED.—Until 3 years

16 after the dissolution date, the Holding Company,

17 and any subsidiary of the Holding Company other

18 than the Association, shall prominently display—

19 ‘‘(A) in any document offering its securi20 ties, that the obligations of the Holding Com21 pany and any such subsidiary are not guaran22 teed by the full faith and credit of the United

23 States; and

24 ‘‘(B) in any advertisement or promotional

25 materials which use the ‘Sallie Mae’ name or
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1 mark, a statement that neither the Holding

2 Company nor any such subsidiary is a Govern3 ment-sponsored enterprise or instrumentality of

4 the United States.

5 ‘‘(f) STRICT CONSTRUCTION.—Except as specifically

6 set forth in this section, nothing contained in this section

7 shall be construed to limit the authority of the Association

8 as a federally chartered corporation, or of the Holding

9 Company as a State or District of Columbia chartered cor10 poration.

11 ‘‘(g) RIGHT TO ENFORCE.—The Secretary of Edu12 cation or the Secretary of the Treasury, as appropriate,

13 may request the Attorney General of the United States

14 to bring an action in the United States District Court for

15 the District of Columbia for the enforcement of any provi16 sions of this section, or may, under the direction or control

17 of the Attorney General, bring such an action. Such court

18 shall have jurisdiction and power to order and require

19 compliance with this section.

20 ‘‘(h) DEADLINE FOR REORGANIZATION EFFECTIVE

21 DATE.—This section shall be of no further force and effect

22 in the event that the reorganization effective date does not

23 occur on or before 18 months after the date of enactment

24 of this section.

25 ‘‘(i) DEFINITIONS.—For purposes of this section:
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1 ‘‘(1) The term ‘Association’ means the Student

2 Loan Marketing Association.

3 ‘‘(2) The term ‘dissolution date’ shall mean

4 September 30, 2007, or such earlier date as the Sec5 retary of Education permits the transfer of remain6 ing obligations in accordance with subsection (d) of

7 this section.

8 ‘‘(3) The term ‘reorganization effective date’

9 means the effective date of the reorganization as de10 termined by the Board of Directors of the Associa11 tion, which shall not be earlier than the date that

12 stockholder approval is obtained pursuant to sub13 section (b) of this section and shall not be later than

14 the date that is 18 months after the date of enact15 ment of this section.

16 ‘‘(4) The term ‘Holding Company’ means the

17 new business corporation formed pursuant to this

18 section by the Association under the laws of any

19 State of the United States or the District of Colum20 bia.

21 ‘‘(5) The term ‘remaining obligations’ shall

22 mean the debt obligations of the Association out23 standing as of the dissolution date.

24 ‘‘(6) The term ‘remaining property’ shall mean

25 the following assets and liabilities of the Association
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1 which are outstanding as of the reorganization effec2 tive date: (A) debt obligations issued by the Associa3 tion, (B) contracts relating to interest rate, cur4 rency, or commodity positions or protections, (C) in5 vestment securities owned by the Association, (D)

6 any instruments, assets, or agreements described in

7 section 439(d) of this Act (including without limita8 tion all student loans, forward purchase and lending

9 commitments, warehousing advances, academic fa10 cilities obligations, letters of credit, standby bond

11 purchase agreements, liquidity agreements, and stu12 dent loan revenue bonds or other loans), and (E) ex13 cept as specifically prohibited by this Act, any other

14 nonmaterial assets or liabilities of the Association

15 which the Association’s Board of Directors deter16 mines to be necessary or appropriate to its oper17 ations.

18 ‘‘(7) The term ‘reorganization’ means the re19 structuring event or events (including any merger

20 event) giving effect to the holding company structure

21 described in subsection (a) of this section.

22 ‘‘(8) The term ‘subsidiary’ or ‘subsidiaries’ shall

23 mean one or more direct or indirect subsidiaries of

24 the Holding Company.’’.

25 (b) TECHNICAL AMENDMENTS.—
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1 (1) AMENDMENTS TO THE HIGHER EDUCATION

2 ACT.—Effective on the reorganization effective date

3 (as defined in section 440(h)(3) of the Higher Edu4 cation Act of 1965, as added by subsection (a))—

5 (A) section 435(d)(1)(F) of such Act (20

6 U.S.C. 1085(d)(1)(F)) is amended by inserting

7 after ‘‘Student Loan Marketing Association’’

8 the following: ‘‘or the Holding Company of the

9 Student Loan Marketing Association, including

10 all subsidiaries of such Holding Company, cre11 ated pursuant to section 440 of this Act,’’; and

12 (B) sections 435(d)(1)(G) and

13 428C(a)(1)(A) of such Act (20 U.S.C.

14 1085(d)(1)(G); 1078–3(a)(1)(A)) are each

15 amended by inserting after ‘‘Student Loan

16 Marketing Association’’ the following: ‘‘or the

17 Holding Company of the Student Loan Market18 ing Association, including all subsidiaries of

19 such Holding Company, created pursuant to

20 section 440 of this Act’’.

21 (2) ENFORCEMENT OF SAFETY AND SOUND22 NESS REQUIREMENTS.—Section 439(r) of the High23 er Education Act of 1965 (20 U.S.C. 1087–2(r)) is

24 amended—
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1 (A) by redesignating paragraph (13) as

2 paragraph (15); and

3 (B) by inserting after paragraph (12) the

4 following new paragraph:

5 ‘‘(13) ENFORCEMENT OF SAFETY AND SOUND6 NESS REQUIREMENTS.—The Secretary of Education

7 or the Secretary of the Treasury, as appropriate,

8 may request the Attorney General of the United

9 States to bring an action in the United States Dis10 trict Court for the District of Columbia for the en11 forcement of any provisions of this subsection, or

12 may, under the direction or control of the Attorney

13 General, bring such an action. Such court shall have

14 jurisdiction and power to order and require compli15 ance with this subsection.’’.

16 (3) CAPITAL RATIO AMENDMENTS.—Section

17 439(r) of the Higher Education Act of 1965 is fur18 ther amended—

19 (A) in paragraph (1)—

20 (i) by striking ‘‘and’’ at the end of

21 subparagraph (A);

22 (ii) by striking the period at the end

23 of subparagraph (B) and inserting ‘‘;

24 and’’; and
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1 (iii) by adding at the end the follow2 ing new subparagraph:

3 ‘‘(C) within 45 days of the end of each fis4 cal quarter, (i) financial statements of the Asso5 ciation, and (ii) a report setting forth the cal6 culation of the capital ratio of the Associa7 tion.’’;

8 (B) in paragraph (11), by striking ‘‘para9 graphs (4) and (6)(A)’’ and inserting ‘‘para10 graphs (4), (6)(A), and (14)’’; and

11 (C) by inserting after paragraph (13) (as

12 added by paragraph (2) of this subsection) the

13 following new paragraph:

14 ‘‘(14) ACTIONS BY SECRETARY.—If the share15 holders of the Association shall have approved a re16 organization plan in accordance with section 440(b)

17 and, for any fiscal quarter ended after January 1,

18 2000, the Association shall have a capital ratio of

19 less than 2.25 percent, the Secretary of the Treas20 ury may, until such capital ratio is met, take any

21 one or more of the actions described in paragraph

22 (7), except that—

23 ‘‘(A) the capital ratio to be restored pursu24 ant to paragraph (7)(D) shall be 2.25 percent;

25 and
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1 ‘‘(B) if the relevant capital ratio is in ex2 cess of or equal to 2 percent for such quarter,

3 the Secretary of the Treasury shall defer taking

4 any of the actions set forth in paragraph (7)

5 until the next succeeding quarter and may then

6 proceed with any such action only if the capital

7 ratio of the Association remains below 2.25 per8 cent.

9 Upon approval by the shareholders of the Associa10 tion of a reorganization plan in accordance with sec11 tion 440(b) for any period after January 1, 2000,

12 the provisions of paragraphs (4), (5), (6), (8), (9),

13 and (10) shall be of no further application to the As14 sociation.’’.

15 (4) REPEAL OF THE ASSOCIATION’S CHAR16 TER.—Effective on the dissolution date (as defined

17 in section 440(h)(2) of the Higher Education Act of

18 1965, as added by subsection (a)), section 439 of

19 such Act (20 U.S.C. 1087–2) is repealed.

20 SEC. 602. PRIVATIZATION OF COLLEGE CONSTRUCTION

21 LOAN INSURANCE ASSOCIATION.

22 (a) REPEAL OF STATUTORY RESTRICTIONS.—Part D

23 of title VII of the Higher Education Act of 1965 (20

24 U.S.C. 1132f et seq.) is repealed.

25 (b) STATUS OF THE CORPORATION.—
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1 (1) STATUS OF THE CORPORATION.—The Cor2 poration shall not be an agency, instrumentality, or

3 establishment of the United States Government and

4 shall not be a ‘‘Government corporation’’ nor a

5 ‘‘Government controlled corporation’’ as defined in

6 section 103 of title 5, United States Code. No action

7 under section 1491 of title 28, United States Code

8 (commonly known as the Tucker Act) shall be allow9 able against the United States based on the actions

10 of the Corporation.

11 (2) CORPORATE POWERS.—The Corporation

12 shall have the power to engage in any business or

13 other activities for which corporations may be orga14 nized under the laws of any State of the United

15 States or the District of Columbia. The Corporation

16 shall have the power to enter into contracts, to exe17 cute instruments, to incur liabilities, to provide prod18 ucts and services, and to do all things as are nec19 essary or incidental to the proper management of its

20 affairs and the efficient operation of a private, for21 profit business.

22 (c) RELATED PRIVATIZATION REQUIREMENTS.—

23 (1) NOTICE REQUIREMENTS.—During the 5-

24 year period following the date of the enactment of

25 this Act, the Corporation shall include in any docu-
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1 ment offering the Corporation’s securities, in any

2 contracts for insurance, guarantee, or reinsurance of

3 obligations, and in any advertisement or promotional

4 material, a statement that—

5 (A) the Corporation is not a Government6 sponsored enterprise or instrumentality of the

7 United States; and

8 (B) the Corporation’s obligations are not

9 guaranteed by the full faith and credit of the

10 United States.

11 (2) CORPORATE CHARTER.—The Corporation’s

12 charter shall be amended as necessary and without

13 delay to conform the requirements of this Act.

14 (3) CORPORATE NAME.—The name of the Cor15 poration, or of any direct or indirect subsidiary

16 thereof, may not contain the term ‘‘College Con17 struction Loan Insurance Association’’.

18 (4) ARTICLES OF INCORPORATION.—The Cor19 poration shall amend its articles of incorporation

20 without delay to reflect that one of the purposes of

21 the Corporation shall be to guarantee, insure and re22 insure bonds, leases, and other evidences of debt of

23 educational institutions, including Historically Black

24 Colleges and Universities and other academic insti25 tutions which are ranked in the lower investment
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1 grade category using a nationally recognized credit

2 rating system.

3 (5) TRANSITION REQUIREMENTS.—

4 (A) REQUIREMENTS UNTIL STOCK SALE.—

5 Notwithstanding subsection (a), the require6 ments of section 754 of the Higher Education

7 Act of 1965 (20 U.S.C. 1132f–3), as in exist8 ence as of the day before enactment of this Act,

9 shall continue to be effective until the day im10 mediately following the date of closing of the

11 purchase of the Secretary’s stock (or the date

12 of closing of the final purchase, in the case of

13 multiple transactions) pursuant to subsection

14 (d) of this section.

15 (B) REPORTS AFTER STOCK SALE.—The

16 Corporation shall, not later than March 30 of

17 the first full calendar year immediately follow18 ing the sale pursuant to subsection (d), and

19 each of the 2 succeeding years, submit to the

20 Secretary of Education a report describing the

21 Corporation’s efforts to assist in the financing

22 of education facilities projects, including

23 projects for elementary, secondary, and post24 secondary educational institution infrastructure,

25 and detailing, on a project-by-project basis, the
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1 Corporation’s business dealings with edu2 cational institutions that are rated by a nation3 ally recognized statistical rating organization at

4 or below the organization’s third highest rat5 ings.

6 (d) SALE OF FEDERALLY OWNED STOCK.—

7 (1) SALE OF STOCK REQUIRED.—The Secretary

8 of the Treasury shall, upon the request of the Sec9 retary of Education make every effort to sell, pursu10 ant to section 324 of title 31, United States Code,

11 the voting common stock of the Corporation owned

12 by the Secretary of Education not later than one

13 year after the date of the enactment of this Act.

14 (2) PURCHASE BY THE CORPORATION.—In the

15 event that the Secretary of the Treasury is unable

16 to sell the voting common stock, or any portion

17 thereof, at a price acceptable to the Secretary of

18 Education and the Secretary of the Treasury within

19 the period specified in paragraph (1), the Corpora20 tion shall purchase such stock at a price determined

21 by the Secretary of the Treasury and acceptable to

22 the Corporation based on independent appraisal by

23 one or more nationally recognized financial firms.

24 Such firms shall be selected by the Secretary of the
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1 Treasury in consultation with the Secretary of Edu2 cation and the Corporation.

3 (e) ASSISTANCE BY THE CORPORATION.—The Cor4 poration shall provide such assistance as the Secretary of

5 the Treasury and the Secretary of Education may require

6 to facilitate the sale of the stock under this section.

7 (f) DEFINITION.—As used in this section, the term

8 ‘‘Corporation’’ means the Corporation established pursu9 ant to the provision of law repealed by subsection (a).

10 TITLE VII—REPEALERS AND

11 OTHER AMENDMENTS

12 SEC. 701. HIGHER EDUCATION PROVISIONS.

13 (a) HIGHER EDUCATION ACT OF 1965 PROVI14 SIONS.—The following provisions of the Higher Education

15 Act of 1965 are repealed:

16 (1) Part B of title I (20 U.S.C. 1011 et seq.),

17 relating to articulation agreements.

18 (2) Part C of title I (20 U.S.C. 1015 et seq.),

19 relating to access and equity to education for all

20 Americans through telecommunications.

21 (3) Title II (20 U.S.C. 1021 et seq.), relating

22 to academic libraries and information services.

23 (4) Chapter 2 of subpart 2 of part A of title IV

24 (20 U.S.C. 1070a–21 et seq.), relating to national

25 early intervention scholarships.
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1 (5) Chapter 3 of subpart 2 of part A of title IV

2 (20 U.S.C. 1070a–31 et seq.), relating to presi3 dential access scholarships.

4 (6) Chapter 4 of subpart 2 of part A of title IV

5 (20 U.S.C. 1070a–41 et seq.), relating to model pro6 gram community partnerships and counseling

7 grants.

8 (7) Chapter 5 of subpart 2 of part A of title IV

9 (20 U.S.C. 1070a–52 et seq.), relating to an early

10 awareness information program.

11 (8) Chapter 8 of subpart 2 of part A of title IV

12 (20 U.S.C. 1070a–81), relating to technical assist13 ance for teachers and counselors.

14 (9) Subpart 8 of part A of title IV (20 U.S.C.

15 1070f), relating to special child care services for dis16 advantaged college students.

17 (10) Section 428J (20 U.S.C. 1078–10), relat18 ing to loan forgiveness for teachers, individuals per19 forming national community service and nurses.

20 (11) Section 486 (20 U.S.C. 1093), relating to

21 training in financial aid services.

22 (12) Subpart 1 of part H of title IV (20 U.S.C.

23 1099a et seq.) relating to State postsecondary re24 view entity programs.
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1 (13) Part A of title V (20 U.S.C. 1102 et seq.),

2 relating to State and local programs for teacher ex3 cellence.

4 (14) Part B of title V (20 U.S.C. 1103 et seq.),

5 relating to national teacher academies.

6 (15) Subpart 1 of part C of title V (20 U.S.C.

7 1104 et seq.), relating to Douglas teacher scholar8 ships.

9 (16) Subpart 3 of part C of title V (20 U.S.C.

10 1106 et seq.), relating to the teacher corps.

11 (17) Subpart 3 of part D of title V (20 U.S.C.

12 1109 et seq.), relating to class size demonstration

13 grants.

14 (18) Subpart 4 of part D of title V (20 U.S.C.

15 1110 et seq.), relating to middle school teaching

16 demonstration programs.

17 (19) Subpart 1 of part E of title V (20 U.S.C.

18 1111 et seq.), relating to new teaching careers.

19 (20) Subpart 1 of part F of title V (20 U.S.C.

20 1113 et seq.), relating to the national mini corps

21 programs.

22 (21) Section 586 (20 U.S.C. 1114), relating to

23 demonstration grants for critical language and area

24 studies.
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1 (22) Section 587 (20 U.S.C. 1114a), relating to

2 development of foreign languages and cultures in3 structional materials.

4 (23) Subpart 3 of part F of title V (20 U.S.C.

5 1115), relating to small State teaching initiatives.

6 (24) Subpart 4 of part F of title V (20 U.S.C.

7 1116), relating to faculty development grants.

8 (25) Section 597 and section 599(b) (20 U.S.C.

9 1117a, 1117c(b)), relating to early childhood staff

10 training and professional enhancement.

11 (26) Section 605 (20 U.S.C. 1124a), relating to

12 intensive summer language institutes.

13 (27) Section 607 (20 U.S.C. 1125a), relating to

14 foreign language periodicals.

15 (28) Part A of title VII (20 U.S.C. 11326 et

16 seq.), relating to academic and library facilities.

17 (29) Title VIII (20 U.S.C. 1133 et seq.), relat18 ing to cooperative education programs.

19 (30) Part A of title IX (20 U.S.C. 1134a et

20 seq.), relating to women and minority participation

21 in graduate education.

22 (31) Part B of title IX (20 U.S.C. 1134d et

23 seq.), relating to Harris fellowships.

24 (32) Part C of title IX (20 U.S.C. 1134h et

25 seq.), relating to Javits fellowships.
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1 (33) Part E of title IX (20 U.S.C. 1134r et

2 seq.), relating to the faculty development fellowship

3 program.

4 (34) Part F of title IX (20 U.S.C. 1134s et

5 seq.), relating to legal training for the disadvan6 taged.

7 (35) Part G of title IX (20 U.S.C. 1134u et

8 seq.), relating to law school clinical programs.

9 (36) Section 1011 (20 U.S.C. 1135a–11), relat10 ing to special projects in areas of national need.

11 (37) Subpart 2 of part B of title X (20 U.S.C.

12 1135c et seq.), relating to science and engineering

13 access programs.

14 (38) Part C of title X (20 U.S.C. 1135e et

15 seq.), relating to women and minorities science and

16 engineering outreach demonstration programs.

17 (39) Part D of title X (20 U.S.C. 1135f), relat18 ing to Eisenhower leadership programs.

19 (40) Title XI (20 U.S.C. 1136 et seq.), relating

20 to community service programs.

21 (b) EDUCATION AMENDMENTS OF 1986 PROVI22 SIONS.—The following provisions of the Higher Education

23 Amendments of 1986 are repealed:
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1 (1) Part E of title XIII (20 U.S.C. 1221–1

2 note), relating to a National Academy of Science

3 study.

4 (2) Part B of title XV (20 U.S.C. 4441 et

5 seq.), relating to Native Hawaiian culture and art

6 development.

7 (c) EDUCATION AMENDMENTS OF 1992 PROVI8 SIONS.—The following provisions of the Higher Education

9 Amendments of 1992 are repealed:

10 (1) Part F of title XIII (25 U.S.C. 3351 et

11 seq.), relating to American Indian postsecondary

12 economic development scholarships.

13 (2) Part G of title XIII (25 U.S.C. 3371), re14 lating to American Indian teacher training.

15 (3) Section 1406 (20 U.S.C. 1221e–1 note), re16 lating to a national survey of factors associated with

17 participation.

18 (4) Section 1409 (20 U.S.C. 1132a note), relat19 ing to a study of environmental hazards in institu20 tions of higher education.

21 (5) Section 1412 (20 U.S.C. 1101 note), relat22 ing to a national job bank for teacher recruitment.

23 (6) Part B of title XV (20 U.S.C. 1452 note),

24 relating to a national clearinghouse for postsecond25 ary education materials.
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1 (7) Part C of title XV (20 U.S.C. 1101 note),

2 relating to school-based decisionmakers.

3 (8) Part D of title XV (20 U.S.C. 1145h note),

4 relating to grants for sexual offenses education.

5 (9) Part E of title XV (20 U.S.C. 1070 note),

6 relating to Olympic scholarships.

7 (10) Part G of title XV (20 U.S.C. 1070a–11

8 note), relating to advanced placement fee payment

9 programs.

10 (d) CONFORMING AMENDMENTS.—the Higher Edu11 cation Act of 1965 is amended—

12 (1) in section 453(c)(2)—

13 (A) by striking subparagraph (E); and

14 (B) by redesignating subparagraphs (F)

15 through (H) as subparagraphs (E) through (G),

16 respectively;

17 (2) in section 487(a)(3), by striking subpara18 graph (B) and redesignating subparagraphs (C) and

19 (D) as subparagraphs (B) and (C), respectively;

20 (3) in section 487(a)(15), by striking ‘‘the Sec21 retary of Veterans Affairs, and State review entities

22 under subpart 1 of part H’’ and inserting ‘‘and the

23 Secretary of Veterans Affairs’’;

24 (4) in section 487(a)(21), by striking ‘‘, State

25 postsecondary review entities,’’;
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1 (5) in section 487(c)(1)(A)(i), by striking

2 ‘‘State agencies, and the State review entities re3 ferred to in subpart 1 of part H’’ and inserting ‘‘and

4 State agencies’’;

5 (6) in section 487(c)(4), by striking ‘‘, after

6 consultation with each State review entity designated

7 under subpart 1 of part H,’’;

8 (7) in section 487(c)(5), by striking ‘‘State re9 view entities designated under subpart 1 of part

10 H,’’;

11 (8) in section 496(a)(7), by striking ‘‘and the

12 appropriate State postsecondary review entity’’;

13 (9) in section 496(a)(8), by striking ‘‘and the

14 State postsecondary review entity of the State in

15 which the institution of higher education is located’’;

16 (10) in section 498(g)(2), by striking everything

17 after the first sentence;

18 (11) in section 498A(a)(2)(D), by striking ‘‘by

19 the appropriate State postsecondary review entity

20 designated under subpart 1 of this part or’’;

21 (12) in section 498A(a)(2)—

22 (A) by inserting ‘‘and’’ after the semicolon

23 at the end of subparagraph (E);

24 (B) by striking subparagraph (F); and
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1 (C) by redesignating subparagraph (G) as

2 subparagraph (F); and

3 (13) in section 498A(a)(3)—

4 (A) by inserting ‘‘and’’ after the semicolon

5 at the end of subparagraph (C);

6 (B) by striking ‘‘; and’’ at the end of sub7 paragraph (D) and inserting a period; and

8 (C) by striking subparagraph (E).

9 SEC. 702. ELIGIBLE INSTITUTION.

10 (a) AMENDMENTS.—Section 481(b) of the Higher

11 Education Act of 1965 (20 U.S.C. 1088(b)) is amended—

12 (1) by inserting before the period at the end of

13 the first sentence the following: ‘‘on the basis of a

14 review by the institution’s independent auditor using

15 generally accepted accounting principles’’; and

16 (2) by inserting after the end of such first sen17 tence the following new sentences: ‘‘For the purposes

18 of clause (6), revenues from sources that are not de19 rived from funds provided under this title include

20 revenues from programs of education or training

21 that do not meet the definition of an eligible pro22 gram in subsection (e), but are provided on a con23 tractual basis under Federal, State, or local training

24 programs, or to business and industry. For the pur25 poses of determining whether an institution meets
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1 the requirements of clause (6), the Secretary shall

2 not consider the financial information of any institu3 tion for a fiscal year began on or before April 30,

4 1994.’’.

5 (b) EFFECTIVE DATE.—Notwithstanding section 713

6 of this Act, the amendments made by subsection (a) shall

7 apply to any determination made on or after July 1, 1994,

8 by the Secretary of Education pursuant to section

9 481(b)(6) of the Higher Education Act of 1965.

10 SEC. 703. CARL D. PERKINS VOCATIONAL AND APPLIED

11 TECHNOLOGY EDUCATION ACT.

12 The Carl D. Perkins Vocational and Applied Tech13 nology Education Act (20 U.S.C. 2301 et seq.) is repealed.

14 SEC. 704. SMITH-HUGHES ACT.

15 (a) REPEAL.—The Smith-Hughes Act (39 Stat. 929

16 as amended (20 U.S.C. 11–15, 16–28)) is repealed.

17 (b) EFFECTIVE DATE.—Notwithstanding section 713

18 of this Act, the repeal in subsection (a) of this section shall

19 take effect on October 1, 1995.

20 SEC. 705. SCHOOL-TO-WORK OPPORTUNITIES ACT OF 1994.

21 The School-to-Work Opportunities Act of 1994 (20

22 U.S.C. 6101 et seq.) is repealed.
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1 SEC. 706. SCHOOL DROPOUT ASSISTANCE ACT.

2 The School Dropout Assistance Act, (part C of title

3 V of the Elementary and Secondary Education Act (20

4 U.S.C. 7261)) is repealed.

5 SEC. 707. ADULT EDUCATION ACT.

6 (a) IN GENERAL.—The Adult Education Act (20

7 U.S.C. 1201 et seq.) is repealed.

8 (b) CONFORMING AMENDMENTS.—

9 (1) ESEA.—The Elementary and Secondary

10 Education Act of 1965 (20 U.S.C. 6301 et seq.) is

11 amended—

12 (A) in section 1202(c)(1), by striking ‘‘the

13 Adult Education Act,’’ and inserting ‘‘title IV

14 of the CAREERS Act,’’;

15 (B) in section 1205(8)(B), by striking ‘‘the

16 Adult Education Act,’’ and inserting ‘‘title IV

17 of the CAREERS Act,’’;

18 (C) in section 1206(a)(1)(A), by striking

19 ‘‘the Adult Education Act;’’ and inserting ‘‘title

20 IV of the CAREERS Act;’’; and

21 (D) in section 9161(2), by striking ‘‘sec22 tion 312(2) of the Adult Education Act.’’ and

23 inserting ‘‘section 5 of the CAREERS Act.’’.

24 (2) TECHNOLOGY FOR EDUCATION ACT.—The

25 Technology for Education Act of 1994 (20 U.S.C.

26 6801 et seq.) is amended in section 3113(1) by
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1 striking ‘‘section 312 of the Adult Education Act;’’

2 and inserting ‘‘section 5 of the CAREERS Act;’’;

3 SEC. 708. NATIONAL LITERACY ACT.

4 The National Literacy Act of 1991, except section

5 101 of such Act, is repealed.

6 SEC. 709. LIBRARY SERVICES AND CONSTRUCTION ACT.

7 (a) IN GENERAL.—The Library Services and Con8 struction Act (20 U.S.C. 351 et seq.) is repealed.

9 (b) CONFORMING AMENDMENT.—The Technology for

10 Education Act of 1994 (20 U.S.C. 6801 et seq.) is amend11 ed in section 3113(10) by striking ‘‘section 3 of the Li12 brary Services and Construction Act;’’ and inserting ‘‘sec13 tion 5 of the CAREERS Act;’’.

14 SEC. 710. TECHNOLOGY FOR EDUCATION ACT OF 1994.

15 Part F of the Technology for Education Act of 1994

16 (contained in title III of the Elementary and Secondary

17 Education Act (20 U.S.C. 7001 et seq.)) is repealed.

18 SEC. 711. JOB TRAINING PARTNERSHIP ACT.

19 (a) IN GENERAL.—The Job Training Partnership

20 Act (29 U.S.C. 1501 et seq.), except section 1, sections

21 421 through 439 (relating to the Job Corps), and section

22 441 of such Act (relating to veterans’ employment pro23 grams), is hereby repealed.

24 (b) CONFORMING AMENDMENTS.—
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1 (1) SHORT TITLE.—Section 1 of the Job Train2 ing Partnership Act (29 U.S.C. 1501, note) is

3 amended—

4 (A) in the heading, by striking ‘‘; TABLE

5 OF CONTENTS’’; and

6 (B) by striking all that follows after ‘‘Job

7 Training Partnership Act’’.

8 (2) JOB CORPS.—Such Act (29 U.S.C. 1501 et

9 seq.), as amended by this section, is further amend10 ed—

11 (A) by redesignating sections 421 through

12 439 as sections 2 through 21, respectively;

13 (B) in section 2 (as redesignated), by

14 striking ‘‘part’’ each place it appears and in15 serting ‘‘Act’’;

16 (C) in section 4(4) (as redesignated), by

17 striking ‘‘sections 424 and 425’’ and inserting

18 ‘‘sections 5 and 6’’;

19 (D) in section 5 (as redesignated)—

20 (i) in subsection (a), by striking ‘‘enti21 ties administering programs under title II

22 of this Act,’’; and

23 (ii) in subsection (b), by striking

24 ‘‘part’’ and inserting ‘‘Act’’;

25 (E) in section 7 (as redesignated)—
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1 (i) in subsection (a), by striking ‘‘sec2 tion 428’’ and inserting ‘‘section 9’’; and

3 (ii) by striking subsection (d);

4 (F) in section 8 (as redesignated)—

5 (i) by striking subsection (b); and

6 (ii) by redesignating subsection (c) as

7 subsection (b);

8 (G) in section 14 (as redesignated)—

9 (i) in subsection (a)(4), by striking

10 ‘‘part’’ and inserting ‘‘Act’’;

11 (ii) in subsection (c)(1), by striking

12 ‘‘and activities authorized under sections

13 452 and 453’’; and

14 (iii) in subsection (e), by striking

15 ‘‘section 431’’ and inserting ‘‘section 12’’;

16 (H) in section 15 (as redesignated)—

17 (i) in subsection (a)—

18 (I) in the matter preceding para19 graph (1), by striking ‘‘section 427’’

20 and inserting ‘‘section 8’’; and

21 (II) in paragraph (4)(A), by

22 striking ‘‘section 428’’ and inserting

23 ‘‘section 9’’;

24 (ii) in subsection (c)(3), by striking

25 ‘‘section 423’’ and inserting ‘‘section 4’’;
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1 (iii) in subsection (d), by striking

2 ‘‘sections 424 and 425’’ and inserting

3 ‘‘sections 5 and 6’’; and

4 (iv) in subsection (e), by striking ‘‘,

5 pursuant to section 452(d),’’;

6 (I) in section 17 (as redesignated), by

7 striking ‘‘purpose of this part’’ each place it ap8 pears and inserting ‘‘purpose of this Act’’;

9 (J) in section 20 (as redesignated), by

10 striking ‘‘part’’ each place it appears and in11 serting ‘‘Act’’; and

12 (K) in section 21 (as redesignated), by

13 striking ‘‘part’’ and inserting ‘‘Act’’.

14 (3) VETERANS’ EMPLOYMENT PROGRAMS.—

15 Such Act (29 U.S.C. 1501 et seq.), as amended by

16 this section, is further amended—

17 (A) by redesignating section 441 as section

18 22;

19 (B) by striking the heading of such section

20 22 (as redesignated), and inserting the follow21 ing:

22 ‘‘VETERANS’ EMPLOYMENT PROGRAMS’’; and

23 (C) in such section 22, by striking ‘‘part’’

24 each place it appears and inserting ‘‘section’’.

25 (4) AUTHORIZATION OF APPROPRIATIONS.—

26 Such Act (29 U.S.C. 1501 et seq.), as amended by
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1 this section, is further amended by adding at the

2 end the following new section:

3 ‘‘AUTHORIZATION OF APPROPRIATIONS

4 ‘‘SEC. 23. There are authorized to be appropriated

5 such sums as are necessary to carry out this Act.’’.

6 SEC. 712. STEWART B. MCKINNEY HOMELESS ASSISTANCE

7 ACT.

8 (a) ADULT EDUCATION.—

9 (1) IN GENERAL.—Subtitle A of title VII of the

10 Stewart B. McKinney Homeless Assistance Act (42

11 U.S.C. 11421 et seq.) is repealed.

12 (2) TABLE OF CONTENTS.—The table of con13 tents of such Act is amended by striking the items

14 relating to subtitle A of title VII of such Act.

15 (b) SUBTITLE C.—

16 (1) IN GENERAL.—Subtitle C of title VII of the

17 Stewart B. McKinney Homeless Assistance Act (42

18 U.S.C. 11441 et seq.), except section 738, is hereby

19 repealed.

20 (2) TABLE OF CONTENTS.—The table of con21 tents of such Act is amended—

22 (A) by striking the item relating to subtitle

23 C of title VII of such Act; and

24 (B) by striking the items relating to sec25 tions 731 through 737 and sections 739

26 through 741.
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1 SEC. 713. EFFECTIVE DATE.

2 The repeals and amendments made by this Act shall

3 take effect on July 1, 1997, except for amendments to

4 the Rehabilitation Act of 1973.

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