5684 Federal Register / Vol. 62, No. 25 / Thursday, February 6, 1997 / Rules and Regulations

DEPARTMENT OF EDUCATION

34 CFR Part 379

RIN 1820–AB33

Projects With Industry

AGENCY: Department of Education.

ACTION: Final regulations.

SUMMARY: The Secretary amends the

regulations governing the Projects With

Industry (PWI) program to clarify

statutory intent, reduce grantee burden,

address certain implementation

problems, and enhance project

accountability.

EFFECTIVE DATE: These regulations take

effect March 10, 1997.

FOR FURTHER INFORMATION CONTACT:

Thomas E. Finch, U.S. Department of

Education, 600 Independence Avenue,

SW., Room 3315, Mary E. Switzer

Building, Washington, DC 20202–2575.

Telephone: (202) 205–8292. Individuals

who use a telecommunications device

for the deaf (TDD) may call the Federal

Information Relay Service (FIRS) at 1–

800–877–8339 between 8 a.m. and 8

p.m., Eastern time, Monday through

Friday.

SUPPLEMENTARY INFORMATION: The PWI

program is authorized by section 621 of

the Rehabilitation Act of 1973, as

amended (the Act). The purpose of the

PWI program is to create and expand job

and career opportunities for individuals

with disabilities in the competitive

labor market by establishing

partnerships between program grantees

and private industry to provide job

training, job placement, and career

advancement activities.

On January 22, 1996, the Secretary

published a notice of proposed

rulemaking (NPRM) for this program in

the Federal Register (61 FR 1672). The

major issues related to this program are

discussed in greater detail in the

preamble to the NPRM.

The significant changes made in these

final regulations from the NPRM

include revision of the definitions of

‘‘placement,’’ ‘‘competitive

employment,’’ and ‘‘integrated setting,’’

as well as an additional application

content requirement for a description of

career advancement services. These

changes are discussed in detail in the

analysis of comments section of the

preamble to the final regulations.

The Secretary invited comments on

changes needed to improve the

compliance indicators in the NPRM, but

has made no changes to the indicators

in these final regulations. The

comments provided in response to the

NPRM, as well as the comments

provided by interested parties in

subsequent follow-up meetings held by

the Rehabilitation Services

Administration (RSA), will be used by

the Department in determining what

changes to make to the compliance

indicators. The Secretary expects to

propose specific revisions to the PWI

compliance indicators in the near

future.

Goals 2000: Educate America Act

The Goals 2000: Educate America Act

(Goals 2000) focuses the Nation’s

education reform efforts on the eight

National Education Goals and provides

a framework for meeting them. Goals

2000 promotes new partnerships to

strengthen schools and expands the

Department’s capacities for helping

communities to exchange ideas and

obtain information needed to achieve

the goals.

These regulations address the

National Education Goal that every

adult American will possess the

knowledge and skills necessary to

compete in a global economy and

exercise the rights and responsibilities

of citizenship.

Executive Order 12866

Assessment of Costs and Benefits

These final regulations have been

reviewed in accordance with Executive

Order 12866. Under the terms of the

order the Secretary has assessed the

potential costs and benefits of this

regulatory action.

The potential costs associated with

the final regulations are those resulting

from statutory requirements and those

determined by the Secretary as

necessary for administering this

program effectively and efficiently.

In assessing the potential costs and

benefits—both quantitative and

qualitative—of these final regulations,

the Secretary has determined that the

benefits of the final regulations justify

the costs.

The Secretary has also determined

that this regulatory action does not

unduly interfere with State, local, and

tribal governments in the exercise of

their governmental functions.

Summary of Potential Costs and

Benefits

The potential costs and benefits of

these final regulations were discussed in

the preamble to the NPRM under the

following headings: More Accurate

Reflection of Statutory Requirements,

Reduction of Grantee Burden, and

Clarification of Program Requirements

(61 FR 1677).

Analysis of Comments and Changes

In response to the Secretary’s

invitation in the NPRM, 87 parties

submitted comments on the proposed

regulations. An analysis of the

comments and of the changes in the

regulations since publication of the

NPRM follows.

The comments have been grouped

according to subject, with appropriate

references to sections of the regulations.

Technical and other minor changes—

and suggested changes the Secretary is

not legally authorized to make under the

applicable statutory authority—are not

addressed.

Section 379.3 Eligibility for Services

Comments: Several commenters

recommended alternative procedures for

determining eligibility for PWI services

other than those specified in the NPRM.

One commenter wanted eligibility to be

determined jointly by the State

vocational rehabilitation (VR) agency,

the PWI grantee, and the individual

seeking PWI services. Another

commenter stated that only the VR

agency or its designee should make

eligibility determinations. Another

commenter wanted PWI grantees to be

allowed to determine eligibility for PWI

services without VR agency review.

Another commenter wanted the final

regulations to clarify that a PWI grantee

is responsible for making eligibility

determinations even if the grant is subcontracted to another organization. A

final commenter raised concerns that

some VR agencies do not respond to

initial or preliminary determinations of

eligibility made by PWI grantees.

Discussion: Section 621(a)(3) of the

Act prescribes the manner in which

eligibility for PWI services is to be

determined. The VR agency is initially

authorized to make eligibility

determinations in this program, but if

the VR agency fails to act, either by not

making a determination or failing to

disagree within 60 days with a

preliminary determination of eligibility

made by the PWI grantee, then the PWI

grantee can determine eligibility. There

is no legal authority to substitute a

different eligibility determination

process in the regulations. Under the

Department’s grants regulations,

grantees are held responsible for all

aspects of their project operations, even

if they subcontract project activities.

Finally, the regulations address

concerns that some VR agencies do not

respond to preliminary PWI eligibility

determinations by providing, consistent

with the statute, that if the VR agency

fails to act within 60 days, then the

preliminary PWI eligibility
Federal Register / Vol. 62, No. 25 / Thursday, February 6, 1997 / Rules and Regulations 5685

determination becomes a final

determination.

Changes: The Secretary has revised

the explanatory material in the note

following this section to clarify that if

the VR agency has referred an

individual to a PWI project for services,

then the VR agency has already

determined that the individual is

eligible for project services. In other

instances, the PWI grantee makes an

initial determination of eligibility that

becomes final if not countermanded by

the VR agency within 60 days.

Section 379.5 Definitions

Section 379.5(b)(2)(ii) Definition of

‘‘Competitive Employment’’—Prevailing

Community Wage Requirement

Comments: Several commenters

opposed the requirement in the

proposed regulations that individuals in

competitive employment earn at least

the prevailing wage for the same or

similar work in the local community

performed by non-disabled individuals.

Eight commenters believed that it would

be unduly burdensome for grantees to

ascertain the relevant prevailing wage

given the potential differences in wages

provided by employers within the same

community. A few commenters stated

that prevailing community wage rates

are sometimes inflated and that many

job-seekers are unsuccessful in finding

employment at the prevailing

community wage. Several commenters

recommended that the final regulations

require only that the minimum wage be

paid and that PWI participants be

afforded the same terms and benefits

provided to non-disabled co-workers in

similar jobs, consistent with section

621(b) (1) and (2) of the Act. Other

commenters recommended that the

wage standard should be one of parity

with the wages paid by the same

employer to non-disabled workers doing

the same or similar job.

Discussion: The Secretary agrees that

requiring individuals placed by the PWI

program into competitive employment

to earn at least the prevailing wage for

the same or similar work in the local

community performed by non-disabled

individuals is unduly restrictive and

potentially burdensome. The Secretary

also agrees that a more reasonable wage

standard is one that is employer-based

rather than community-based and that

requires equity in wage and terms and

benefits (e.g., insurance premiums,

retirement contributions) with nondisabled workers.

Changes: The Secretary has amended

§ 379.5(b)(2)(ii) to define ‘‘competitive

work,’’ in part, as work for which an

individual earns at least the minimum

wage but not less than the customary or

usual wage and terms and benefits

provided by the same employer to nondisabled workers who perform the same

or similar work.

Section 379.5(b)(3) Definition of

Integrated Setting, as Part of the

Definition of ‘‘Competitive

Employment’’

Comments: Several commenters were

concerned that the proposed standard

for integration in competitive

employment (the opportunity for

interaction with non-disabled

individuals at the work site) would

preclude certain kinds of employment

outcomes from the scope of competitive

employment. Specifically, the

commenters identified self-employment,

home-based employment, and various

forms of telecommuting as examples of

employment outcomes that are

competitive, but are not located in

integrated settings. These commenters

stated that these employment options

should be available to individuals with

disabilities served by the PWI program

to the same extent that they are

available to non-disabled persons. Other

commenters stated that individuals in

competitive employment should be

required to interact with non-disabled

persons only to the extent that nondisabled persons in similar positions

interact with others.

Discussion: The Secretary agrees with

those commenters who contend that the

best measure of integration in an

employment setting for individuals with

disabilities is to require parity with the

integration experienced by non-disabled

workers in similar positions. The

Secretary also believes that interaction

between individuals with disabilities

and non-disabled persons need not be

face-to-face in order to meet this

standard. Individuals with disabilities

under the PWI program who are selfemployed or who telecommute may

interact regularly with non-disabled

persons through a variety of mediums

(e.g., telephone, facsimile, or computer).

Self-employment, home-based

employment, and other forms of

employment in which individuals

communicate regularly from separate

locations, therefore, would satisfy the

integration requirement of competitive

employment as long as the individual

interacts with non-disabled persons,

other than service providers, to the same

extent as a non-disabled person in a

comparable job.

Changes: The Secretary has revised

§ 379.5(b)(3) to establish a standard of

integration for individuals in

competitive employment that is based

on ensuring the same level of

interaction with non-disabled persons

as that experienced by a non-disabled

worker in the same or similar job.

Section 379.5(b)(5) Definition of ‘‘Job

Training’’

Comments: One commenter

recommended the inclusion of preemployment planning under the

definition of job training. Another

commenter recommended expanding

the definition of job training to include

social preparation for individuals

interviewing for jobs. Ten commenters

recommended deleting the phrase

‘‘provided prior to placement’’ because

the phrase excludes training by

employers or other entities after

placement. Two commenters

recommended that attitudinal change

training be provided for employers

under the definition of training. Four

commenters recommended that training

be provided in an integrated setting.

Other commenters underscored the

need for specific input on the part of the

Business Advisory Committee (BAC) in

identifying and prescribing training

needs. Still other commenters stated

that the responsibility for defining the

parameters of job training should be the

domain of the BAC. Another commenter

stated that the emphasis on skills

training is contrary to current trends of

‘‘one-stop career centers’’ and expressed

doubts as to whether grantees have

adequate resources and expertise to

provide job skills training.

Discussion: The Secretary believes

that the final regulations give projects

sufficient flexibility to provide preemployment planning and interview

preparation if these services are deemed

necessary. However, the Secretary

believes that these activities fall under

the definition of job readiness training

in § 379.5(b)(4), rather than the

definition of job training under this

section. The Secretary also believes that

attitudinal change training for

employers is an authorized activity

under the PWI program, but does not

believe it falls within the scope of job

training, as it is defined in this section.

While section 621(a)(2)(B) of the Act

requires that training be provided in

‘‘realistic work settings,’’ the Secretary

does not believe that this can be

interpreted to require projects to

provide training in an integrated setting.

However, the Secretary encourages

projects to ensure that training is

provided in an integrated setting to the

extent possible.

The Secretary strongly agrees with the

commenters who stated that the BAC

should take an active role in prescribing

training programs and notes that this is

consistent with section 621(a)(2)(A)(iv)
5686 Federal Register / Vol. 62, No. 25 / Thursday, February 6, 1997 / Rules and Regulations

of the Act, which states that the BAC

shall ‘‘prescribe training programs

designed to develop appropriate job and

career skills.’’ The Secretary does not

believe that the definition of job training

in this section in any way weakens this

statutory requirement.

The Secretary notes the concern of

some commenters that grantees may

have insufficient resources to provide

job training. The use of the BAC, other

private industry expertise, and active

collaboration with State VR agencies

and other providers can supplement

what individual projects may lack in

terms of resources for job training.

Changes: None.

Section 379.5(b)(7) Definition of

‘‘Placement’’

Comments: One commenter

recommended that the term

‘‘placement’’ be deleted throughout the

regulations and replaced with the term

‘‘PWI employment outcome.’’ This

commenter believed the use of the term

‘‘placement’’ was confusing because the

proposed definition includes two

elements: (1) Attaining competitive

employment and (2) maintaining it for

a certain period.

Other commenters were concerned

about the proposed minimum retention

period for maintaining competitive

employment in order to have the

employment outcome considered a

placement for purposes of meeting the

program compliance indicators. The

NPRM proposed the option of using the

duration of the employer’s normal

probationary period or, if the employer

does not have an established

probationary period, for at least 90 days.

The current regulatory time period for

maintaining employment is 60 days.

These commenters stated that the use of

a probationary period was problematical

for a variety of reasons, such as (1) an

employer’s probationary period could

be as short as two weeks, and that

timeframe would be inadequate; (2)

many employers no longer use

probationary periods, so the option is

not meaningful; and (3) if some

employers have long probationary

periods, some projects might be

disinclined to place individuals with

those employers. Some commenters

argued for a uniform Federal standard in

the regulations that would avoid

variations among employers. Some of

these commenters suggested that there

be no change from the current retention

period of 60 days. Other commenters

recommended 90 days, 120 days, 180

days, or 12 months. Some commenters

objected to any specific timeframe in the

regulations and believed the retention

period should be individually

determined by the individual with a

disability, the counselor, and the

employer.

Some commenters recommended that

the phrase ‘‘who has successfully

completed training’’ be deleted from the

definition because the regulations

recognize that not all persons served by

a PWI project may need and, therefore,

receive job training.

Discussion: The Secretary does not

believe the use of the term ‘‘placement,’’

as defined in the regulations, is

confusing. The PWI regulations for

many years have defined ‘‘placement’’

to include a required period of time in

which a competitive employment

outcome must be maintained.

The Secretary agrees with those

commenters who believe the use of a

probationary period option is

problematical and that a uniform

minimum retention period prescribed in

the regulations is desirable. The

Secretary also believes that the retention

period should be longer than the 60

days required in the current regulations

in order to ensure that the individual’s

employment remains stable. The

Secretary has determined that 90 days is

the minimum acceptable standard and

that this lengthened time period will

result in more successful placements. At

the same time, however, the Secretary

recognizes that in some instances 90

days may be too short a period to ensure

job stability. Section 621(a)(2)(E) of the

Act requires projects to provide any

support services that may be required

for an individual to maintain

employment. Therefore, the Secretary

encourages projects to make

individualized determinations of

whether to extend the 90-day period to

conform with an employer’s longer

probationary period if, at the end of the

90 days, it is uncertain whether the

individual will be able to successfully

satisfy the probationary period without

support services from the project.

The Secretary also agrees that the

phrase ‘‘who has successfully

completed training’’ is inaccurate and

should be removed from the definition

because some project participants may

not need job training.

Changes: The Secretary has amended

the definition of ‘‘placement’’ in the

final regulations to provide for a

minimum job retention period of 90

days and to substitute the phrase ‘‘who

has received services’’ for the phrase

‘‘who has successfully completed

training.’’

Section 379.10(a) Project Requirements

Regarding Job Training and the Note to

This Section

Comments: One commenter

recommended deletion of the last three

sentences of the note, which specify that

training provided after placement (i.e.,

attaining competitive employment and

maintaining it for at least 90 days) or

job-readiness training do not satisfy the

requirement that projects provide job

training. Another commenter suggested

revising this requirement to allow

projects the option of providing only job

readiness training. Some commenters

suggested that individual projects

should have the responsibility of

assessing each participant’s training

needs and how that training will be

provided. Some commenters suggested

that grantees should be allowed the

flexibility to work with employers in

order to provide training on the job.

Some commenters questioned whether

job training should be provided for all

participants. Two commenters stated

that all grantees should have an

identifiable training component for

individuals who lack job skills, but that

all program participants should not be

required to avail themselves of training.

Other commenters mentioned the added

costs of providing job training and asked

whether grant awards should be

increased to cover these costs.

Discussion: The Secretary disagrees

with the commenter who suggests

deletion of the clarification in the note

that training provided after placement

and job readiness training do not by

themselves satisfy the requirement in

§ 379.10(a). In accordance with section

621(a)(2)(B) of the Act, projects are

required to provide training in order to

prepare the individuals for employment

and career advancement in the

competitive market. The Secretary,

therefore, believes that projects should

ensure that training, if deemed

appropriate to the participant’s needs, is

provided either before the individual

begins employment or within the first

90 days of employment (i.e., before the

individual is considered placed in

accordance with the definition of

‘‘placement’’ in § 379.5(b)(7)). On-thejob training would meet the

requirements of this section if the

project ensures its provision and it is

provided within the first 90 days of

employment. The 90-day requirement,

of course, does not apply to employed

individuals who are receiving career

advancement services from a PWI

project.

The Secretary also believes that the

job training requirement is not met if a

project provides only job readiness
Federal Register / Vol. 62, No. 25 / Thursday, February 6, 1997 / Rules and Regulations 5687

training. While job readiness training is

an authorized activity under the PWI

program, the Secretary believes that job

readiness training alone does not meet

the statutory requirement that projects

provide training to prepare individuals

for employment in the competitive labor

market. The final regulations, like the

NPRM, therefore contain separate

definitions of ‘‘job training’’ and ‘‘job

readiness training.’’ The Secretary

agrees with those commenters who

suggested that job training need not be

provided to every participant. The

language in this section requires that job

training be provided ‘‘if appropriate to

the needs of each individual served by

the project.’’ However, the Secretary

expects that every project will have a

job training component (whether the

training is provided on-site, through

employers and other entities, or both),

since a certain population of individuals

will enter the program without the job

skills necessary to be placed and

advance in competitive employment.

The Secretary notes the concern of

commenters regarding the costs of

providing job training. The Secretary

believes the regulations give projects

sufficient flexibility to arrange with

employers and other entities to provide

job training should they find that

providing job training themselves is too

costly or for other reasons is not

feasible.

Changes: The Secretary has added a

statement to the note to emphasize that

if a project arranges for the provision of

job training by outside entities (e.g., an

employer), the project must conduct

appropriate follow-up measures to

ensure that training is provided. The

note is also amended to clarify that job

training must be provided either prior

to, or within 90 days of, attaining

competitive employment and that job

training provided by the employer after

this 90-day period, therefore, does not

meet the requirement of § 379.10(a).

Section 379.21(a)(1) Application

Content Requirement Regarding Labor

Market Analysis

Comments: A number of commenters

stated that a labor market analysis

obligates applicants to predict for five

years the training needs that will meet

the demands of the labor market and

that the labor market changes too

rapidly for this to be accomplished.

Other commenters recommended

deleting the language regarding labor

market analysis. Other commenters

stated that individuals with disabilities

may not fit appropriately into a market

trend and may require individualized

job matching. A commenter

recommended that each application

describe how existing labor market

studies will be used in securing

employment and validating training

needs.

Discussion: The Secretary does not

intend to require the use of a particular

tool (e.g., a labor market analysis) to

identify the needs of the local labor

market. If an applicant determines that

a labor market analysis is inappropriate

for the type of project being proposed,

the applicant can choose a different

method of identifying local labor market

needs. The requirement in § 379.21(a)(1)

is intended to ensure that applicants

have assessed labor market needs in the

geographic area to be served and have

designed their projects in accordance

with the identified needs for people

trained for specific occupations.

Applicants can determine labor market

needs by either performing their own

labor market analyses or needs

assessments in conjunction with private

industry or by using existing current

labor market analyses or needs

assessments. The Secretary understands

that local labor market needs may

change during the five-year duration of

the project and that these changes may,

in some cases, necessitate adjustments

in the project. However, the Secretary

believes that this does not diminish the

utility of an initial labor market analysis

or needs assessment. The Secretary also

believes that the identification of local

labor market needs does not contravene

the practice of individualized jobmatching for individuals with

disabilities.

Changes: The Secretary has made

minor changes to clarify that the

applicant may comply with

§ 379.21(a)(1) either by using an existing

current labor market analysis or needs

assessment or by performing a labor

market analysis or needs assessment in

conjunction with private industry.

Section 379.21(a)(4) Application

Content Requirement Concerning

Unserved or Underserved Areas

Comments: One commenter

recommended that an applicant for a

PWI grant be required to document

geographic need through verification by

the State VR agency. This commenter

wanted to avoid duplication of awards

and to ensure that services are provided

in areas most in need.

Discussion: The Secretary encourages

all applicants to consult with the

relevant State VR agency to ensure that

services are to be provided in areas

where individuals are unserved or

underserved, but does not want to

require this. It is the responsibility of

each applicant to explain in its grant

application how the geographic area it

proposes to serve is unserved or

underserved by the PWI program and to

provide whatever justification it

considers necessary to support its

position.

Changes: None.

Section 379.21(a)(7) Requirement

Concerning Career Advancement

Services

Comments: Some commenters

suggested that career advancement

services be addressed with an

application content requirement rather

than as a compliance indicator.

Discussion: The 1992 Amendments to

the Rehabilitation Act of 1973, as

amended, added career advancement

services to the range of services PWI

projects are required to provide. In the

NPRM, the Secretary solicited

comments on how best to address the

career advancement requirement. The

Secretary agrees that an application

content requirement is the best way to

implement the career advancement

services provision.

Changes: In response to commenters’

suggestions, the Secretary has added to

this section the requirement that a grant

application contain a description of how

career advancement services will be

provided to project participants.

Section 379.30 Recommendation of

New Selection Criterion

Comments: One commenter

recommended that applicants under this

program be required to include a plan

for continuing the project after the

Federal grant period has ended.

Discussion: The Secretary finds no

statutory basis, as exists for the

recreation programs authorized under

section 316 of the Act, for adding a

criterion to require applicants to include

a plan for continuation of the project

after the Federal grant period has ended.

Changes: None.

Section 379.30(a)(1) Selection Criterion:

Extent of Need for Project—Labor

Market Analysis

Comments: A number of commenters

suggested alternative language to a

‘‘labor market analysis’’ and

recommended tailoring a needs

assessment to local communities rather

than to the national or regional job

market as implied by the term. Some

commenters recommended that the

phrase ‘‘labor market analysis’’ be

deleted.

Discussion: The Secretary intends,

and the NPRM stated, that the

applicant’s labor market analysis or

needs assessment be conducted ‘‘for the

geographic area to be served.’’ The

Secretary does not intend by using the
5688 Federal Register / Vol. 62, No. 25 / Thursday, February 6, 1997 / Rules and Regulations

term ‘‘labor market analysis’’ to require

the applicant to conduct an analysis that

is regional or national in scope. While

the Secretary expects that projects once

established should work with local

businesses and the BAC to identify job

opportunities for individuals with

disabilities, the Secretary does not

believe this action eliminates the need

for an initial survey of local labor

market needs. An initial labor market

analysis or needs assessment

demonstrates a need for the project and

also enables the project to tailor its job

training and services to the needs of the

local labor market.

Changes: The Secretary has made

minor changes to clarify that the

applicant may satisfy § 379.30(a)(1)

either by using an existing current labor

market analysis or needs assessment or

by performing a labor market analysis or

needs assessment in conjunction with

private industry.

Section 379.30(a)(2) Selection Criterion:

Extent of Need for Project—Labor

Market Analysis

Comments: None.

Discussion: The Secretary believes the

phrase ‘‘occupations and occupational

categories’’ is more precise than

‘‘industry or industries’’ because it

refers to a type of job or jobs for which

participants are to be trained (e.g.,

computer programmer) rather than the

industries in which they might be

placed (e.g., the computer industry).

Changes: The Secretary has amended

§ 379.30(a)(2) in the final regulations to

clarify that the job training to be

provided must meet the identified needs

for specific occupations or occupational

categories in the geographic area to be

served.

Section 379.41(a)(f) Allowable Costs

Comments: One commenter

recommended specifying under this

section on allowable costs that, if

appropriate, grantees may modify

facilities and equipment of employers.

Another commenter recommended the

addition of job modification and job

development as allowable costs.

Discussion: The Secretary agrees with

the commenters that the costs of job

development and modification and the

costs of modifications of employer

facilities or equipment to be used by

PWI program participants should be

specifically identified in the final

regulations as permissible expenditures.

This is consistent with language in 34

CFR 379.10(d) (1) and (3), which

requires grantees to undertake these

activities, to the extent appropriate.

Changes: The Secretary has amended

§ 379.41(a) to include as allowable costs

job development and modification and

modifications for facilities and

equipment of employers participating in

the program.

Section 379.43 and § 379.54(a) Annual

Evaluation Report and Compliance

Indicator Data

Comments: One commenter did not

agree with the proposed requirement

that projects submit annual evaluation

report and compliance indicator data 60

days after the end of the project year.

Discussion: The Secretary believes

that the 60-day timeline is reasonable

for submission of project evaluation and

compliance indicator data in order to

ensure timely receipt of project

information and to increase program

accountability. In addition, the

Secretary has the option to extend this

timeline for reasonable cause.

Changes: None.

Paperwork Reduction Act of 1995

Under the Paperwork Reduction Act

of 1995, no persons are required to

respond to a collection of information

unless it displays a valid OMB control

number. The valid OMB control number

assigned to the collection of information

in these final regulations is displayed at

the end of the affected sections of the

regulations.

Intergovernmental Review

This program is subject to the

requirements of Executive Order 12372

and the regulations in 34 CFR Part 79.

The objective of the Executive order is

to foster an intergovernmental

partnership and a strengthened

federalism by relying on processes

developed by State and local

governments for coordination and

review of proposed Federal financial

assistance.

In accordance with the order, this

document is intended to provide early

notification of the Department’s specific

plans and actions for this program.

Assessment of Educational Impact

In the notice of proposed rulemaking,

the Secretary requested comments on

whether the proposed regulations would

require transmission of information that

is being gathered by or is available from

any other agency or authority of the

United States.

Based on the response to the proposed

regulations and on its own review, the

Department has determined that the

regulations in this document do not

require transmission of information that

is being gathered by or is available from

any other agency or authority of the

United States.

List of Subjects in 34 CFR Part 379

Education, Grant programs—

education, Grant programs—social

programs, Reporting and recordkeeping

requirements, vocational rehabilitation.

Dated: October 25, 1996.

Judith E. Heumann,

Assistant Secretary for Special Education and

Rehabilitative Services.

(Catalog of Federal Domestic Assistance

Number 84.234 Projects With Industry)

The Secretary amends Title 34 of the

Code of Federal Regulations as follows:

1. By revising part 379, subparts A

through E, by revising the heading of

subpart F, and by adding a new § 379.54

in subpart F to read as follows:

PART 379—PROJECTS WITH

INDUSTRY

Subpart A—General

Sec.

379.1 What is the Projects With Industry

(PWI) program?

379.2 Who is eligible for a grant award

under this program?

379.3 Who is eligible for services under this

program?

379.4 What regulations apply?

379.5 What definitions apply?

Subpart B—What Kinds of Activities Does

the Department of Education Assist Under

This Program?

379.10 What types of project activities are

required of each grantee under this

program?

379.11 What additional types of project

activities may be authorized under this

program?

Subpart C—How Does One Apply for an

Award?

379.20 How does an eligible entity apply

for an award?

379.21 What is the content of an

application for an award?

Subpart D—How Does the Secretary Make

a Grant?

379.30 What selection criteria does the

Secretary use under this program?

379.31 What other factors does the

Secretary consider in reviewing an

application?

Subpart E—What Conditions Must Be Met

by a Grantee?

379.40 What are the matching

requirements?

379.41 What are allowable costs?

379.42 What are the requirements for a

continuation award?

379.43 What are the additional reporting

requirements?
Federal Register / Vol. 62, No. 25 / Thursday, February 6, 1997 / Rules and Regulations 5689

Subpart F—What Compliance Indicator

Requirements Must a Grantee Meet To

Receive Continuation Funding?

* * * * *

379.54 What are the reporting requirements

for the compliance indicators?

* * * * *

Authority: Sects. 12(c) and 621 of the Act;

29 U.S.C. 711(c) and 795g, unless otherwise

noted.

Subpart A—General

§ 379.1 What is the Projects With Industry

(PWI) program?

This program is designed to—

(a) Create and expand job and career

opportunities for individuals with

disabilities in the competitive labor

market by engaging the talent and

leadership of private industry as

partners in the rehabilitation process;

(b) Identify competitive job and career

opportunities and the skills needed to

perform these jobs;

(c) Create practical settings for job

readiness and job training programs;

and

(d) Provide job placements and career

advancement.

(Authority: Sect. 621(a)(1) of the Act; 29

U.S.C. 795g(a)(1))

§ 379.2 Who is eligible for a grant award

under this program?

(a) The Secretary may make a grant

under this program to any—

(1) Community rehabilitation program

provider;

(2) Designated State unit;

(3) Employer;

(4) Indian tribe or tribal organization;

(5) Labor Union;

(6) Nonprofit agency or organization;

(7) Trade association; or

(8) Other agency or organization with

the capacity to create and expand job

and career opportunities for individuals

with disabilities.

(b) New awards may be made only to

those eligible entities identified in

paragraph (a) of this section that

propose to serve individuals with

disabilities in States, portions of States,

Indian tribes, or tribal organizations that

are currently unserved or underserved

by the PWI program.

(Authority: Section 621(a)(2) and 621(e)(2) of

the Act; 29 U.S.C. 795g(a)(2) and 795g(e)(2))

§ 379.3 Who is eligible for services under

this program?

(a) An individual is eligible for

services under this program if the

appropriate State vocational

rehabilitation unit determines the

individual to be an individual with a

disability or an individual with a severe

disability, as defined in sections 7(8)(A)

and 7(15)(A), respectively, of the Act.

(b) In making the determination under

paragraph (a) of this section, the State

vocational rehabilitation unit shall rely

on the determination made by the

recipient of the grant under which the

services are provided, to the extent that

the determination is appropriate,

available, and consistent with the

requirements of the Act.

(c) If a State vocational rehabilitation

unit does not notify a recipient of a

grant within 60 days that the

determination of the recipient is

inappropriate, the recipient of the grant

may consider the individual to be

eligible for services.

(Authority: Sect. 621(a)(3) of the Act; 29

U.S.C. 795g(a)(3))

Appendix to § 379.3

The following guidance is provided

regarding the determination of eligibility for

PWI project services:

(1) If an individual is referred to the PWI

project by the State vocational rehabilitation

(VR) unit and the individual has been

determined by the State VR unit to be an

‘‘individual with a disability’’ under section

102(a)(1)(A) of the Act, then the PWI grantee

may initiate services to that individual. In

these instances, the State VR unit should

provide documentation of this determination

to the PWI grantee. If the State VR unit has

determined that the individual also meets the

definition of an ‘‘individual with a severe

disability’’ under section 7(15)(A) of the Act,

the PWI grantee should be advised of that

determination and provided appropriate

documentation of that determination.

(2) If an individual is not referred to the

PWI project by the State VR unit, then the

PWI grantee makes an initial or preliminary

determination that the individual is eligible

for services because the individual meets the

definition of an ‘‘individual with a

disability’’ or an ‘‘individual with a severe

disability.’’ The State VR unit has a

maximum of 60 days to assess the

appropriateness of the preliminary

determination. If the State VR unit does not

decide that the preliminary eligibility

determination is inappropriate within this

time period, the eligibility determination

becomes final.

§ 379.4 What regulations apply?

The following regulations apply to the

Projects With Industry program:

(a) The regulations in this part 379;

and

(b) The regulations in 34 CFR part

369, except for the regulations in

§§ 369.30 and 369.31.

Authority: Sect. 621 of the Act; 29 U.S.C.

795g)

§ 379.5 What definitions apply?

(a) The definitions in 34 CFR part 369

apply to this program.

(b) The following definitions also

apply to this program:

(1) Career advancement services mean

services that develop specific job skills

beyond those required by the position

currently held by an individual with a

disability to assist the individual to

compete for a promotion or achieve an

advanced position.

(2) Competitive employment, as the

placement outcome under this program,

means work—

(i) In the competitive labor market

that is performed on a full-time or parttime basis in an integrated setting; and

(ii) For which an individual is

compensated at or above the minimum

wage, but not less than the customary or

usual wage and terms and benefits

provided by the employer for the same

or similar work performed by

individuals who are not disabled.

(3) Integrated setting, as part of the

definition of competitive employment,

means a setting typically found in the

community in which individuals with

disabilities interact with non-disabled

individuals, other than non-disabled

individuals who are providing services

to them, to the same extent that nondisabled individuals in comparable

positions interact with other persons.

(4) Job readiness training, as used in

§ 379.41(a), means—

(i) Training in job-seeking skills;

(ii) Training in the preparation of

resumes or job applications;

(iii) Training in interviewing skills;

(iv) Participating in a job club; or

(v) Other related activities that may

assist an individual to secure

competitive employment.

(5) Job training, as used in this part,

means one or more of the following

training activities provided prior to

placement, as that term is defined in

§ 379.5(b)(7):

(i) Occupational skills training.

(ii) On-the-job training.

(iii) Workplace training combined

with related instruction.

(iv) Job skill upgrading and retraining.

(v) Training to enhance basic work

skills and workplace competencies.

(vi) On-site job coaching.

(6) Person served means an individual

for whom services by a PWI project have

been initiated with the objective that

those services will result in a placement

in competitive employment.

(7) Placement means the attainment

of competitive employment by a person

who has received services from a PWI

project and has maintained employment

for a period of at least 90 days.

(Authority: Sects. 12(c) and 621 of the Act;

29 U.S.C. 711(c) and 795g)
5690 Federal Register / Vol. 62, No. 25 / Thursday, February 6, 1997 / Rules and Regulations

Subpart B—What Kinds of Activities

Does the Department of Education

Assist Under This Program?

§ 379.10 What types of project activities

are required of each grantee under this

program?

Each grantee under the PWI program

shall—

(a) Arrange for the provision of, or

provide individuals with disabilities

with, job training in a realistic work

setting, if appropriate to the needs of the

individual, in order to prepare

individuals for employment and career

advancement in the competitive labor

market;

(b) Provide individuals with

disabilities with job placement and

career advancement services;

(c) Provide individuals with

disabilities with supportive services that

are necessary to permit them to

maintain the employment and career

advancement for which they have

received training under this program;

(d) To the extent appropriate, provide

for—

(1) The development and

modification of jobs and careers to

accommodate the special needs of the

individuals with disabilities being

trained and employed under this

program;

(2) The purchase and distribution of

rehabilitation technology to meet the

needs of individuals with disabilities at

job sites; and

(3) The modification of any facilities

or equipment of the employer that are

to be used by individuals with

disabilities under this program; and

(e) Provide for the establishment of a

Business Advisory Council (BAC)

comprised of representatives of private

industry, business concerns, organized

labor, and individuals with disabilities

and their representatives who will

identify job and career availability

within the community, the skills

necessary to perform those jobs and

careers, and prescribe appropriate

training programs.

Appendix to § 379.10

A PWI grantee can meet the requirements

of § 379.10(a) (1) by directly providing job

training to project participants, (2) by

arranging for the provision of this training by

other entities and taking appropriate followup measures to ensure that the training is, in

fact, provided, or (3) by a combination of

both (1) and (2). The job training provided

must meet the definition of job training in

§ 379.5(b)(5) and must be provided as

appropriate to the needs of each individual

served by the project. Although each

individual served by the project may not

need job training, the Secretary expects that

each PWI project will have an identifiable job

training component that is available to those

individuals who need it. In order to meet the

requirements of § 379.10(a), the job training

must be provided while the individual is

participating in the project (i.e. prior to, or

within 90 days of, attaining competitive

employment). Therefore, training provided

by an employer more than 90 days after the

individual begins competitive employment

would not meet this requirement. In

addition, a project that provides only job

readiness training, as defined in § 379.5(b)(4),

would not meet the requirements of

§ 379.10(a).

(Authority: Sect. 621(a) of the Act; 29 U.S.C.

795g)

§ 379.11 What additional types of project

activities may be authorized under this

program?

The Secretary may include, as part of

grant agreements with recipients under

this program, authority for recipients to

provide the following types of technical

assistance:

(a) Assisting employers in hiring

individuals with disabilities.

(b) Improving or developing

relationships between grant recipients

or prospective grant recipients and

employers or organized labor.

(c) Assisting employers in

understanding and meeting the

requirements of the Americans with

Disabilities Act of 1990 (42 U.S.C 12101

et seq.) as that Act relates to

employment of individuals with

disabilities.

(Authority: Sect. 621(a) of the Act; 29 U.S.C

795g)

Subpart C—How Does One Apply for

an Award?

§ 379.20 How does an eligible entity apply

for an award?

In order to apply for a grant, an

eligible entity shall submit an

application to the Secretary in response

to an application notice published in

the Federal Register.

(Approved by the Office of Management and

Budget under control number 1820–0612.)

(Authority: Sec. 621(e)(1)(B) of the Act; 29

U.S.C. 795g(e)(1)(B))

§ 379.21 What is the content of an

application for an award?

(a) The grant application must include

a description of—

(1) The proposed job training to

prepare project participants for specific

jobs in the competitive labor market for

which there is a need in the geographic

area to be served by the project, as

identified by an existing current labor

market analysis or other needs

assessment or one conducted by the

applicant in collaboration with private

industry;

(2) The involvement of private

industry in the design of the proposed

project and the manner in which the

project will collaborate with private

industry in planning, implementing,

and evaluating job training, job

placement, and career advancement

activities;

(3) The responsibilities of the BAC

and how it will interact with the project

in carrying out grant activities;

(4) The geographic area to be served

by the project, including an explanation

of how the area is currently unserved or

underserved by the PWI program;

(5) A plan for evaluating annually the

operation of the proposed project,

which, at a minimum, provides for

collecting and submitting to the

Secretary the following information and

any additional data needed to determine

compliance with the program

compliance indicators established in

subpart F of this part:

(i) The numbers and types of

individuals with disabilities served.

(ii) The types of services provided.

(iii) The sources of funding.

(iv) The percentage of resources

committed to each type of service

provided.

(v) The extent to which the

employment status and earning power

of individuals with disabilities changed

following services.

(vi) The extent of capacity building

activities, including collaboration with

business and industry and other

organizations, institutions, and

agencies, including the State vocational

rehabilitation unit.

(vii) A comparison, if appropriate, of

activities in prior years with activities in

the most recent year.

(viii) The number of project

participants who were terminated from

project placements and the duration of

those placements;

(6) A description of the manner in

which the project will address the needs

of individuals with disabilities from

minority backgrounds, as required by 34

CFR 369.21; and

(7) A description of how career

advancement services will be provided

to project participants.

(b) The grant application must also

include assurances from the applicant

that—

(1) The project will carry out all

activities required in § 379.10;

(2) Individuals with disabilities who

are placed by the project will receive

compensation at or above the minimum

wage, but not less than the customary or

usual wage paid by the employer for the

same or similar work performed by

individuals who are not disabled;

(3) Individuals with disabilities who

are placed by the project will be given
Federal Register / Vol. 62, No. 25 / Thursday, February 6, 1997 / Rules and Regulations 5691

terms and benefits of employment equal

to those that are given to similarly

situated co-workers and will not be

segregated from their co-workers; and

(4) The project will maintain any

records required by the Secretary and

make those records available for

monitoring and audit purposes.

(Approved by the Office of Management and

Budget under control number 1820–0612.)

(Authority: Secs. 621(a)(4), 621(a)(5), 621(b),

and 621(e)(1)(B) of the Act; 29 U.S.C.

795g(a)(4), 795g(a)(5), 795g(b), and

795g(e)(1)(B))

Subpart D—How Does the Secretary

Make a Grant?

§ 379.30 What selection criteria does the

Secretary use under this program?

The Secretary uses the following

criteria to evaluate an application:

(a) Extent of need for project (20

points). The Secretary reviews each

application to determine the extent to

which the project meets demonstrated

needs. The Secretary looks for evidence

that—

(1) The applicant has described an

existing current labor market analysis or

other needs assessment, or one that it

has performed in collaboration with

private industry, that shows, for the

geographic area to be served, a demand

in the competitive labor market for the

types of jobs for which project

participants will be trained; and

(2) The job training to be provided

meets the identified needs for personnel

in specific occupations or occupational

categories in the geographic area to be

served.

(b) Partnership with industry (25

points). The Secretary looks for

information that demonstrates—

(1) The extent of the project’s

proposed collaboration with private

industry in the planning,

implementation, and evaluation of job

training, placement, and career

advancement activities; and

(2) The extent of proposed

participation of the BAC in the

identification of job and career

opportunities, the skills necessary to

perform the jobs and careers identified,

and the development of training

programs designed to develop these

skills.

(c) Project design and plan of

operation for achieving competitive

employment outcomes (25 points). The

Secretary reviews each application to

determine—

(1) The extent to which the project

goals and objectives for achieving

competitive employment outcomes for

individuals with disabilities to be

served by the project are clearly stated

and meet the needs identified by the

applicant and the purposes of the

program;

(2) The extent to which the project

provides for all services and activities

required under § 379.10;

(3) The feasibility of proposed

strategies and methods for achieving

project goals and objectives for

competitive employment outcomes for

project participants;

(4) The extent to which project

activities will be coordinated with the

State vocational rehabilitation unit and

with other appropriate community

resources in order to ensure an adequate

number of referrals and a maximum use

of comparable benefits and services;

(5) The extent to which the

applicant’s management plan will

ensure proper and efficient

administration of the project; and

(6) Whether the applicant has

proposed a realistic timeline for the

implementation of project activities to

ensure timely accomplishment of

proposed goals and objectives to achieve

competitive employment outcomes for

individuals with disabilities to be

served by the project.

(d) Adequacy of resources and quality

of key personnel (10 points). The

Secretary reviews each application to

determine—

(1) The adequacy of the resources

(including facilities, equipment, and

supplies) that the applicant plans to

devote to the project;

(2) The quality of key personnel who

will be involved in the project,

including—

(i) The qualifications of the project

director;

(ii) The qualifications of each of the

other key personnel to be used in the

project; and

(iii) The experience and training of

key personnel in fields related to the

objectives and activities of the project;

and

(3) The way the applicant plans to use

its resources and personnel to achieve

the project’s goals and objectives,

including the time that key personnel

will commit to the project.

(e) Budget and cost effectiveness (10

points). The Secretary reviews each

application to determine the extent to

which—

(1) The budget is adequate to support

the project; and

(2) Costs are reasonable in relation to

the objectives of the project.

(f) Project evaluation (10 points). The

Secretary reviews each application to

determine the quality of the proposed

evaluation plan with respect to—

(1) Evaluating project operations and

outcomes;

(2) Involving the BAC in evaluating

the project’s job training, placement,

and career advancement activities;

(3) Meeting the annual evaluation

reporting requirements in § 379.21(a)(5);

(4) Determining compliance with the

indicators; and

(5) Addressing any deficiencies

identified through project evaluation.

(Approved by the Office of Management and

Budget under control number 1820–0612.)

(Authority: Secs. 12(c) and 621 of the Act; 29

U.S.C. 711(c) and 795g)

§ 379.31 What other factors does the

Secretary consider in reviewing an

application?

In addition to the selection criteria in

§ 379.30, the Secretary, in making

awards under this program, considers—

(a) The equitable distribution of

projects among the States; and

(b) The past performance of the

applicant in carrying out a similar PWI

project under previously awarded

grants, as indicated by factors such as

compliance with grant conditions,

soundness of programmatic and

financial management practices, and

meeting the requirements of subpart F of

this part.

(Authority: Secs. 621(e)(2) and 621(f)(4) of

the Act; 29 U.S.C. 795g(e)(2) and 795g(f)(4))

Subpart E—What Conditions Must Be

Met by a Grantee?

§ 379.40 What are the matching

requirements?

The Federal share may not be more

than 80 percent of the total cost of a

project under this program.

(Authority: Sec. 621(c) of the Act; 29 U.S.C.

795g(c))

Appendix to § 379.40

(a) For example, if the total cost of a project

is $500,000, the Federal share would be no

more than $400,000 and the grantee’s

required minimum share (matching

contribution) would be $100,000 (provided

in cash or through third party in-kind

contributions). The matching contribution is

based upon the total cost of the project, not

on the amount of the Federal grant award.

(b) The matching contribution must

comply with the requirements of 34 CFR

74.23 (for grantees that are institutions of

higher education, hospitals, or other

nonprofit organizations) or 34 CFR 80.24 (for

grantees that are State, local, or Indian tribal

governments). The term third party in-kind

contributions is defined in either 34 CFR 74.2

or 34 CFR 80.3, as applicable to the type of

grantee.

§ 379.41 What are allowable costs?

In addition to those costs that are

allowable in accordance with 34 CFR

74.27 and 34 CFR 80.22, the following

items are allowable costs under this

program:
5692 Federal Register / Vol. 62, No. 25 / Thursday, February 6, 1997 / Rules and Regulations

(a) The costs of job readiness training,

as defined in § 379.5(b)(4); job training,

as defined in § 379.5(b)(5); job

placement services; job development

and modification; and related vocational

rehabilitation services and supportive

rehabilitation services.

(b) Instruction and supervision of

trainees.

(c) Training materials and supplies,

including consumable materials.

(d) Instructional aids.

(e) The purchase or modification of

rehabilitation technology to meet the

needs of individuals with disabilities.

(f) Alteration and renovation

appropriate and necessary to ensure

access to and use of buildings by

persons with disabilities served by the

project.

(g) The modification of any facilities

or equipment of the employer to be used

by individuals with disabilities under

this program.

(Authority: Secs. 12(c) and 621 of the Act; 29

U.S.C. 711(c) and 795g))

§ 379.42 What are the requirements for a

continuation award?

(a) A grantee that wants to receive a

continuation award must—

(1) Comply with the provisions of 34

CFR 75.253(a), including making

substantial progress toward meeting the

objectives in its approved application

and submitting all performance and

financial reports required by 34 CFR

75.118; and

(2) Submit data in accordance with

§ 379.54 showing that it has met the

program compliance indicators

established in Subpart F of this part.

(b) In addition to the requirements in

paragraph (a) of this section, the

following other conditions in 34 CFR

75.253(a) must be met before the

Secretary makes a continuation award:

(1) Congress must appropriate

sufficient funds under the program.

(2) Continuation of the project must

be in the best interest of the Federal

Government.

(Approved by the Office of Management and

Budget under control number 1820–0612.)

(Authority: Secs. 12(c) and 621(f)(4) of the

Act; 29 U.S.C. 711(c) and 795g(f)(4))

§ 379.43 What are the additional reporting

requirements?

Each grantee shall submit the data

from its annual evaluation of project

operations required under § 379.21(a)(5)

no later than 60 days after the end of

each project year, unless the Secretary

authorizes a later submission date.

(Approved by the Office of Management and

Budget under control number 1820–0612.)

(Authority: Secs. 12(c) and 621 of the Act; 29

U.S.C. 711(c) and 795g)

Subpart F—What Compliance Indicator

Requirements Must a Grantee Meet To

Receive Continuation Funding?

§ 379.54 What are the reporting

requirements for the compliance

indicators?

(a) In order to receive continuation

funding for the third or any subsequent

year of a PWI grant, each grantee must

submit data for the most recent

complete project year no later than 60

days after the end of that project year,

unless the Secretary authorizes a later

submission date, in order for the

Secretary to determine if the grantee has

met the program compliance indicators

established in this Subpart F.

(b) If the data for the most recent

complete project year provided under

paragraph (a) of this section shows that

a grantee has failed to achieve the

minimum composite score required in

§ 379.52(f) to meet the program

compliance indicators, the grantee may,

at its option, submit data from the first

6 months of the current project year no

later than 60 days after the end of that

6-month period, unless the Secretary

authorizes a later submission date, to

demonstrate that its project performance

has improved sufficiently to meet the

minimum composite score.

(Approved by the Office of Management and

Budget under control number 1820–0612.)

(Authority: Sec. 621(f)(2) of the Act; 29

U.S.C. 795g(f)(2))

Note: A grantee receives its second year of

funding (or the first continuation award)

under this program before data from the first

complete project year is available. Data from

the first project year, however, must be

submitted and is used (unless the grantee

exercises the option in paragraph (b) of this

section) to determine eligibility for the third

year of funding (or the second continuation

award).

* * * * *

§ 379.53 [Amended]

2. Section 379.53 is amended by

adding ‘‘(Approved by the Office of

Management and Budget under control

number 1820–0612.)’’ before the

authority citation at the end of the

section.

[FR Doc. 97–2834 Filed 2–5–97; 8:45 am]

BILLING CODE 4000–01–P