Federal Register / Vol. 83, No. 146 / Monday, July 30, 2018 / Rules and Regulations 36407 

AIRAC date State City Airport FDC No. FDC date Subject 

16–Aug–18 ....... MN Crookston .............. Crookston Muni Kirkwood 

Fld.

8/2928 7/5/18 RNAV (GPS) RWY 13, Orig. 

16–Aug–18 ....... MN Crookston .............. Crookston Muni Kirkwood 

Fld.

8/2929 7/5/18 RNAV (GPS) RWY 31, Orig–A. 

16–Aug–18 ....... MN Crookston .............. Crookston Muni Kirkwood 

Fld.

8/2930 7/5/18 VOR/DME RWY 13, Orig–A. 

16–Aug–18 ....... GA Thomaston ............ Thomaston-Upson County .... 8/3028 6/27/18 ILS OR LOC RWY 30, Amdt 2A. 

16–Aug–18 ....... IL Mattoon/Charleston Coles County Memorial ........ 8/3782 7/5/18 RNAV (GPS) RWY 11, Orig–A. 

16–Aug–18 ....... FL Fernandina Beach Fernandina Beach Muni ....... 8/3809 7/5/18 RNAV (GPS) RWY 13, Amdt 2A. 

16–Aug–18 ....... FL Fernandina Beach Fernandina Beach Muni ....... 8/3813 7/5/18 RNAV (GPS) RWY 22, Amdt 1B. 

16–Aug–18 ....... KS Abilene .................. Abilene Muni ......................... 8/3819 7/5/18 Takeoff Minimums and Obstacle 

DP, Orig. 

16–Aug–18 ....... IA Webster City ......... Webster City Muni ................ 8/3826 7/5/18 NDB RWY 32, Amdt 8. 

16–Aug–18 ....... WY Jackson ................. Jackson Hole ........................ 8/4092 7/5/18 RNAV (GPS) Z RWY 19, Amdt 

1A. 

16–Aug–18 ....... IL Morris .................... Morris Muni—James R 

Washburn Field.

8/4370 7/5/18 RNAV (GPS) RWY 18, Amdt 1. 

16–Aug–18 ....... IA Harlan ................... Harlan Muni .......................... 8/4397 7/5/18 GPS RWY 15, Orig–B. 

16–Aug–18 ....... IA Harlan ................... Harlan Muni .......................... 8/4408 7/5/18 GPS RWY 33, Orig–B. 

16–Aug–18 ....... TX Hereford ................ Hereford Muni ....................... 8/4517 6/27/18 RNAV (GPS) RWY 20, Orig–A. 

16–Aug–18 ....... WI Madison ................ Dane County Rgnl-Truax 

Field.

8/4627 6/27/18 VOR RWY 14, Orig–D. 

16–Aug–18 ....... IL Springfield ............. Abraham Lincoln Capital ...... 8/4856 7/5/18 ILS OR LOC RWY 31, Amdt 2A. 

16–Aug–18 ....... OH Cadiz ..................... Harrison County .................... 8/4975 7/5/18 VOR–A, Amdt 1. 

16–Aug–18 ....... GA Americus ............... Jimmy Carter Rgnl ................ 8/5187 6/27/18 RNAV (GPS) RWY 5, Amdt 1A. 

16–Aug–18 ....... TX Houston ................. William P Hobby ................... 8/5265 7/5/18 RNAV (GPS) RWY 35, Amdt 1A. 

16–Aug–18 ....... NY Westhampton 

Beach.

Francis S Gabreski ............... 8/5268 7/5/18 ILS OR LOC RWY 24, Amdt 11. 

16–Aug–18 ....... FL Immokalee ............ Immokalee Rgnl .................... 8/5921 6/27/18 RNAV (GPS) RWY 9, Amdt 1. 

16–Aug–18 ....... FL Immokalee ............ Immokalee Rgnl .................... 8/5922 6/27/18 RNAV (GPS) RWY 18, Amdt 1. 

16–Aug–18 ....... FL Immokalee ............ Immokalee Rgnl .................... 8/5924 6/27/18 RNAV (GPS) RWY 27, Amdt 1. 

16–Aug–18 ....... FL Immokalee ............ Immokalee Rgnl .................... 8/5925 6/27/18 RNAV (GPS) RWY 36, Amdt 1. 

16–Aug–18 ....... SC Cheraw .................. Cheraw Muni/Lynch Bellinger 

Field.

8/6174 7/5/18 RNAV (GPS) RWY 8, Orig–A. 

16–Aug–18 ....... FL Inverness .............. Inverness .............................. 8/6407 7/9/18 RNAV (GPS) RWY 19, Orig–A. 

16–Aug–18 ....... IN Valparaiso ............. Porter County Rgnl ............... 8/6943 7/9/18 ILS RWY 27, Amdt 3. 

16–Aug–18 ....... PA Philadelphia .......... Wings Field ........................... 8/6979 6/27/18 RNAV (GPS) RWY 6, Amdt 1A. 

16–Aug–18 ....... PA Philadelphia .......... Wings Field ........................... 8/6980 6/27/18 RNAV (GPS) RWY 24, Amdt 1A. 

16–Aug–18 ....... PA Harrisburg ............. Harrisburg Intl ....................... 8/7378 6/27/18 ILS OR LOC RWY 31, Amdt 1C. 

FL Orlando ................. Executive .............................. 8/8391 7/9/18 ILS OR LOC RWY 7, Amdt 24. 

16–Aug–18 ....... FL Orlando ................. Executive .............................. 8/8393 7/9/18 RNAV (GPS) RWY 7, Amdt 2A. 

16–Aug–18 ....... MO Bowling Green ...... Bowling Green Muni ............. 8/8445 7/9/18 VOR/DME–A, Amdt 2. 

16–Aug–18 ....... MO Bowling Green ...... Bowling Green Muni ............. 8/8453 7/9/18 RNAV (GPS) RWY 13, Orig. 

16–Aug–18 ....... MO Bowling Green ...... Bowling Green Muni ............. 8/8454 7/9/18 RNAV (GPS) RWY 31, Orig. 

16–Aug–18 ....... MS Brookhaven ........... Brookhaven-Lincoln County 8/8668 6/27/18 RNAV (GPS) RWY 22, Orig. 

16–Aug–18 ....... NH Keene .................... Dillant-Hopkins ...................... 8/9189 6/27/18 ILS OR LOC RWY 2, Amdt 4. 

16–Aug–18 ....... NH Keene .................... Dillant-Hopkins ...................... 8/9190 6/27/18 RNAV (GPS) RWY 2, Orig. 

16–Aug–18 ....... NH Keene .................... Dillant-Hopkins ...................... 8/9191 6/27/18 VOR RWY 2, Amdt 13. 

[FR Doc. 2018–16139 Filed 7–27–18; 8:45 am] 

BILLING CODE 4910–13–P 

DEPARTMENT OF LABOR 

Employment and Training 

Administration 

20 CFR Part 641 

[Docket No. ETA–2017–0005] 

RIN 1205–AB79 

Senior Community Service 

Employment Program; Performance 

Accountability 

AGENCY: Employment and Training 

Administration, Labor. 

ACTION: Final rule. 

SUMMARY: The Employment and 

Training Administration (ETA) of the 

Department of Labor (Department) is 

adopting as a final rule without change 

the interim final rule (IFR) published by 

the Department in the Federal Register 

on December 1, 2017. The IFR revised 

performance accountability measures 

for the Senior Community Service 

Employment Program (SCSEP). The 

Older Americans Act (OAA) 

Reauthorization Act of 2016 (2016 OAA) 

amended the measures of performance 

for the SCSEP program in large part to 

align them with the performance 

measures mandated for programs under 

the Workforce Innovation and 

Opportunity Act (WIOA) and required 

implementation, including through 

regulation by December 31, 2017. The 

IFR revised the Performance 

Accountability subpart of the SCSEP 

regulations to reflect changes 

necessitated by the passage of the 2016 

OAA. In addition, the IFR made minor, 

non-substantive amendments to other 

subparts of the SCSEP regulations to 

reflect the 2016 OAA amendments that 

aligned the SCSEP program statutory 

language with WIOA, such as updating 

outdated terminology and outdated 

references to the Workforce Investment 

Act of 1998 (WIA), which WIOA 

superseded. The implemented 

regulations, referred to as an IFR, took 

effect on January 2, 2018. The 

Department solicited public comment 

on the IFR, and the Department 

considered these comments when it 

prepared this final rule. 


daltland on DSKBBV9HB2PROD with RULES
36408 Federal Register / Vol. 83, No. 146 / Monday, July 30, 2018 / Rules and Regulations 

1Section 6 of the 2016 OAA amended secs. 502– 

518 of title V of the original (1965) OAA (42 U.S.C. 

3056 et seq.). For ease of reference, this preamble 

will refer to the changes to title V made by the 2016 

OAA by referring to the amended sections of the 

OAA, and will not continue to provide the citations 

to sec. 6 of the 2016 OAA. 

DATES: 

Effective date: This final rule is 

effective August 29, 2018. 

Compliance date: Grantees must 

report performance information under 

the measures implemented in the IFR 

and adopted without change in this 

final rule beginning July 1, 2018. This 

rule is not an E.O. 13771 regulatory 

action because this rule is not 

significant under E.O. 12866. 

FOR FURTHER INFORMATION CONTACT: 

Amanda Ahlstrand, Administrator, 

Office of Workforce Investment, 

ahlstrand.amanda@dol.gov, 202–693– 

3980. (This is not a toll-free number.) 

SUPPLEMENTARY INFORMATION: 

Preamble Table of Contents 

I. Background 

II. Summary of Public Comments Received 

on the Interim Final Rule 

III. Section-by-Section Discussion of the 

Final Rule 

IV. Regulatory Flexibility Analysis, Executive 

Order 13272, Small Business Regulatory 

Enforcement Fairness Act 

V. Other Regulatory Considerations 

I. Background 

The SCSEP, authorized by title V of 

the OAA, is the only federally 

sponsored employment and training 

program targeted specifically to lowincome, older individuals who want to 

enter or re-enter the workforce. 

Participants must be 55 years of age or 

older, with incomes no more than 125 

percent of the Federal poverty level. The 

program offers participants training at 

community service assignments in 

public and non-profit organizations and 

agencies so that they can gain on-the-job 

experience. The dual goals of the 

program are to promote useful 

opportunities in community service 

activities and also to move SCSEP 

participants into unsubsidized 

employment, where appropriate, so that 

they can achieve economic selfsufficiency. 

The 2016 OAA, Public Law 114–144 

(Apr. 19, 2016), amended the statutory 

provisions authorizing SCSEP and 

requires the Department to implement 

the amendments to the SCSEP 

performance measures by December 31, 

2017. See OAA sec. 513(d)(4) (42 U.S.C. 

3056k(d)(4), as amended by 2016 OAA 

sec. 6(d)(4) 1). The Department met this 

statutory deadline when it published 

the IFR on December 1, 2017 (82 FR 

56869). This final rule responds to 

public comments received and finalizes 

the IFR. 

The IFR included both the definitions 

of the measures (as required by OAA 

sec. 513(b)(2)) and the processes used to 

implement these measures in the 

conduct of the SCSEP grants. These 

processes include how the Department 

and grantees initially determine and 

then adjust expected levels of 

performance for the grants, and how the 

Department determines whether a 

grantee fails, meets, or exceeds the 

levels of performance. 

The Administrative Procedure Act 

(APA) authorizes agencies to issue a 

rule without notice and comment upon 

a showing of good cause. 5 U.S.C. 

553(b)(B). The APA’s good cause 

exception to public participation 

applies upon a finding that those 

procedures are ‘‘impracticable, 

unnecessary, or contrary to the public 

interest.’’ 5 U.S.C. 553(b)(B). According 

to the legislative history of the APA, 

‘‘unnecessary’’ means ‘‘unnecessary so 

far as the public is concerned, as would 

be the case if a minor or merely 

technical amendment in which the 

public is not particularly interested 

were involved.’’ Senate Report No. 752 

at p. 200, 79th Cong. 1st Sess. (1945). As 

explained by the U.S. Court of Appeals 

for the D.C. Circuit, ‘‘when regulations 

merely restate the statute they 

implement, notice-and-comment 

procedures are unnecessary.’’ Gray 

Panthers Advocacy Comm. v. Sullivan, 

936 F.2d 1284, 1291 (DC Cir. 1991). The 

Department determined that there was 

good cause to find that a pre-publication 

comment period was unnecessary for 

the IFR. The revisions set forth in the 

IFR to the previous regulations at 20 

CFR part 641 codified statutory changes 

requiring little to no agency discretion 

or were technical amendments updating 

terminology or outdated references to 

WIA, which WIOA superseded. 

Therefore, the Department’s issuance of 

the IFR, with provision for postpromulgation public comment, was in 

accordance with sec. 553(b) of the APA. 

The 2016 OAA requires the 

Department to establish and implement 

the new SCSEP performance measures 

after consultation with stakeholders. 

OAA sec. 513(b)(2). The Department 

satisfied these statutory requirements 

when it solicited public input on the 

definitions and implementation of the 

statutory performance measures in April 

and May of 2017. On May 8, 2017, the 

Department sent an email to 4,529 

stakeholders, inviting them to register 

for the consultation. The Department 

also informed stakeholders that they 

could submit written comments after 

the consultation. 

Of the 394 registered participants, 273 

attended the consultation on May 16, 

2017. The IFR discussed at length the 

comments received during and after the 

consultation and, in response to some of 

those comments, made the following 

clarifications: 

• The changes in the IFR to the 

SCSEP performance measurement 

system reflect in large part an alignment 

of the SCSEP performance measures 

with the three employment outcome 

indicators mandated for WIOA core 

programs under WIOA sec. 

116(b)(2)(A)(i)(I) through (III). In 

addition to these three WIOA 

employment outcome indicators of 

performance, SCSEP has three measures 

related to participation in the program: 

service level, hours of community 

service employment, and service to the 

most-in-need. These three measures are 

unique to SCSEP and the 2016 OAA 

amendments retained them unchanged. 

Although WIOA has several similar 

measures, these SCSEP measures are not 

directly applicable to WIOA. In 

addition, the WIOA primary indicators 

of performance include effectiveness in 

serving employers; the corresponding 

measure for SCSEP under the OAA, as 

discussed below at § 641.720, is not 

directly parallel because it includes 

participants and host agencies, as well 

as employers. 

• All the SCSEP measures will be 

incorporated into the Participant 

Individual Record Layout (PIRL, the 

WIOA performance reporting system), 

along with other aspects of SCSEP 

performance. 

• Although the 2016 OAA 

amendments require SCSEP to adopt 

several of WIOA’s primary indicators of 

performance, SCSEP is independent of 

WIOA, and SCSEP performance is not 

included in the WIOA State program or 

indicator scores. 

• While the Department is exploring 

a new case management system that 

may replace the SCSEP Performance 

and Results Quarterly Progress Report 

(SPARQ) system in whole or in part, 

grantees must continue using SPARQ 

until the Department informs them that 

a new system is available. 

• Like the current measures, the new 

performance measures apply to all 

grantees, including both State and 

national grantees. 

See Section I of the IFR for a more 

detailed discussion of the comments 

received during stakeholder 

consultation process. 

The 2016 OAA changes to the SCSEP 

performance measurement system 

reflect in large part an alignment of the 

SCSEP performance measures with 

those mandated for WIOA core 


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Federal Register / Vol. 83, No. 146 / Monday, July 30, 2018 / Rules and Regulations 36409 

programs under WIOA sec. 

116(b)(2)(A)(i). The WIOA performance 

measures were implemented in a joint 

final rule issued by the Departments of 

Labor and Education on August 19, 

2016 (81 FR 55792) (Joint WIOA final 

rule), after notice-and-comment 

rulemaking, and are codified in 20 CFR 

part 677. The IFR, which this final rule 

finalizes, revised the SCSEP regulations 

at 20 CFR part 641, subpart G 

(Performance Accountability) to codify 

the revised SCSEP performance 

measures in 2016 OAA sec. 513, which 

in large part aligns the SCSEP 

performance measures with the WIOA 

performance measures. In addition, the 

IFR made (and this final rule carries 

forward) technical amendments to other 

subparts of part 641 to reflect 2016 OAA 

amendments that aligned the SCSEP 

program statutory language with WIOA, 

such as updating outdated terminology 

and outdated references to WIA, which 

WIOA superseded. 

Coordination between the SCSEP and 

the WIOA programs continues to be an 

important objective of the OAA. SCSEP 

is a required partner in the workforce 

development system (per WIOA sec. 

121(b)(1)(B)(v)), and SCSEP is required 

to coordinate with the WIOA One-Stop 

delivery system (OAA sec. 511, 42 

U.S.C. 3056i), such as by accepting each 

other’s assessments and Individual 

Employment Plans (IEPs) (OAA sec. 

502(b)(3), 42 U.S.C. 3056(b)(3)). The 

underlying notion of the One-Stop 

delivery system is the coordination of 

programs, services, and governance 

structures, to ensure customer access to 

a seamless system of workforce 

development services. Although there 

are many similarities to the system 

established under WIA, there are also 

significant changes under WIOA that are 

intended to make substantial 

improvements to the public workforce 

delivery system. The Joint WIOA final 

rule requires partners to collaborate to 

support a seamless customer-focused 

service delivery network; requiring that 

programs and providers co-locate, 

coordinate, and integrate activities and 

information, so that the system as a 

whole is cohesive and accessible for 

individuals and employers alike. 

The Department remains committed 

to a system-wide continuous 

improvement approach grounded upon 

proven quality principles and practices. 

Although many of the SCSEP 

regulations remain unchanged from the 

2010 SCSEP final rule (75 FR 53786; 

Sept. 1, 2010), the IFR codified the 2016 

OAA revisions to the program that align 

senior employment services with the 

workforce development system under 

WIOA. In particular, the IFR aligned the 

SCSEP performance measures related to 

employment and earnings with the 

performance measures established by 

WIOA to enhance consistency and 

coordination between the programs and 

ensure effective services for older 

Americans. Section III discusses in more 

detail the changes implemented by the 

IFR and finalized by this final rule. 

II. Summary of Public Comments 

Received on the Interim Final Rule 

The Department received comments 

from seven organizations and 

individuals. Four organizations (three 

national grantees and an association 

representing State grantees) submitted 

substantive comments that addressed 

issues within the scope of the IFR: 

Associates for Training and 

Development (A4TD), Vantage Aging 

(previously known as Mature Services), 

Senior Service America (SSAI), and the 

National Association of States United 

for Aging and Disabilities (NASUAD); 

the three individuals submitted nonsubstantive comments. 

The Department considered all 

substantive comments received as it 

developed this final rule. In Section III 

below, ‘‘Section-by-Section Discussion 

of the Final Rule,’’ the Department 

summarizes and discusses the input 

received from A4TD, Vantage Aging, 

and NASUAD. SSAI resubmitted the 

same comments it submitted on June 6, 

2017, in response to the May 16, 2017 

stakeholder webinar, prior to the 

publication of the IFR. Because the 

Department fully responded to the SSAI 

comments in the preamble to the IFR, 

the Department will not respond further 

in this preamble except to clarify some 

of its prior responses. 

Three comments from individuals 

described general dissatisfaction with 

the SCSEP program and its grantees 

based on either negative personal 

experiences or unfavorable anecdotal 

evidence. The preamble does not 

address these comments, as they were 

not in the scope of the rulemaking. 

III. Section-by-Section Discussion of the 

Final Rule 

The Department has made no changes 

to the regulatory text issued in the IFR. 

Non-Substantive Technical 

Amendments 

In addition to the changes made to 

part 641, subpart G (Performance 

Accountability) codifying the 2016 OAA 

statutory revisions as described more 

fully below, the IFR made nonsubstantive, technical amendments 

throughout all of part 641 to reflect the 

2016 OAA amendments and to align the 

SCSEP program language with WIOA, 

such as updating outdated terminology 

and outdated references to WIA, which 

WIOA superseded. The Department did 

not receive any comments on these 

technical amendments and the final rule 

adopts them as issued in the IFR. 

The remainder of this section-bysection discussion describes in detail 

only the substantive subpart G 

revisions. 

Subpart G—Performance Accountability 

Throughout this subpart, the 

Department has revised the term ‘‘core 

indicator(s)’’ to ‘‘core measure(s)’’ to 

align the regulation with the 2016 OAA, 

specifically sec. 513(a), 42 U.S.C. 

3056k(a). The amended statute also 

refers to ‘‘indicators.’’ However, because 

the statute uses the terms 

interchangeably, for consistency and to 

reduce the possibility of confusion, the 

Department uses only the term 

‘‘measures’’ throughout this subpart. 

Other changes made to the sections of 

subpart G are described below. 

Section 641.700 What performance 

measures apply to Senior Community 

Service Employment Program grantees? 

The Department did not receive any 

comments on this section. The final rule 

adopts the provision as originally issued 

in the IFR. 

Section 641.710 How are the 

performance measures defined? 

This section of the rule provides 

definitions of the core measures. The 

IFR revised the core indicator (now 

‘‘core measure’’) definitions contained 

in this section to align with the revised 

core measures set forth in § 641.700 of 

the IFR. As discussed below and in the 

IFR, the Department deleted the entirety 

of former paragraph (b) to remove the 

definitions for the former ‘‘additional 

indicators,’’ which the 2016 OAA 

removed. Thus, as an initial change, the 

IFR renumbered paragraphs (a)(1) 

through (6) to (a) through (g) (to include 

the definition for an added core 

measure, as discussed below). 

Employment Measures 

The IFR did not revise paragraph (a), 

renumbered from former paragraph 

(a)(1), which contains the definition for 

the first core measure for hours of 

community service employment as 

currently implemented. 

In paragraph (b), renumbered from 

former paragraph (a)(2), the IFR 

included a definition for the second 

performance measure, ‘‘percentage of 

project participants who are in 

unsubsidized employment during the 

second quarter after exit from the 

project.’’ The IFR defined this 


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36410 Federal Register / Vol. 83, No. 146 / Monday, July 30, 2018 / Rules and Regulations 

performance measure by the following 

formula: The number of participants 

who exited during the reporting period 

who are employed in unsubsidized 

employment during the second quarter 

after the exit quarter, divided by the 

number of participants who exited 

during the reporting period, multiplied 

by 100 so as to be reported as a 

percentage. This definition aligns with 

the definition of the corresponding 

WIOA performance measure, as 

explained in Training and Employment 

Guidance Letter (TEGL) 10–16, 

Performance Accountability Guidance 

for Workforce Innovation and 

Opportunity Act (WIOA) Title I, Title II, 

Title III and Title IV Core Programs, 

published December 19, 2016. 

In paragraph (c), renumbered from 

former paragraph (a)(3), the IFR 

included a definition for the third 

performance measure, ‘‘percentage of 

project participants who are in 

unsubsidized employment during the 

fourth quarter after exit from the 

project.’’ This performance measure is 

defined by the following formula: The 

number of participants who exited 

during the reporting period who are 

employed in unsubsidized employment 

during the fourth quarter after the exit 

quarter, divided by the number of 

participants who exited during the 

reporting period, multiplied by 100 so 

as to be reported as a percentage. This 

definition aligns with the definition of 

the corresponding WIOA performance 

measure, as explained in TEGL 10–16. 

In response to the IFR, the 

Department received one public 

comment relating to the employment 

measures set forth in this section. 

Specifically, with regard to the fourth 

quarter unsubsidized employment 

measure at paragraph (c), the 

commenter expressed concern that the 

new fourth quarter unsubsidized 

employment measure, while simplifying 

the current measure for employment 

retention, will require grantees to follow 

participants for at least an entire year 

even if the participants did not leave the 

program for unsubsidized employment. 

The commenter contended that this core 

performance measure will place a 

significant burden on grantees while 

producing little increase in performance 

data. 

The commenter is correct that the 

new measure is no longer conditioned 

on a participant’s having been employed 

in the first quarter after the exit quarter 

(as the current core measure for 

employment retention and the 

additional measure for retention at 1 

year require) and, therefore, includes in 

the pool every participant who exits 

from SCSEP unless the participant has 

one of the exclusions from exit. The 

Department, however, declines to revise 

the definition for this core measure. 

Once wage records are available to all 

grantees, nearly all data for this measure 

will be gathered without the need for 

follow-up, and there will be little 

additional burden on the grantees. See 

discussion of the use of wage records at 

§ 641.720. Until that time, grantees 

should first focus their follow-up efforts 

on those participants who leave the 

program for unsubsidized employment 

or who are employed in the second 

quarter after the exit quarter. Grantees 

should then follow participants who did 

not have employment at exit or in the 

second quarter after exit but who 

grantees have reason to believe might 

become employed thereafter. The 

Department will provide technical 

assistance and guidance on the new 

timing and reporting requirements for 

§ 641.710(b) through (d), which are 

hereinafter called the ‘‘three new 

employment outcome measures’’. 

Earnings Measure 

In paragraph (d), renumbered from 

former paragraph (a)(4), the IFR 

included a definition for the fourth 

performance measure, ‘‘median earnings 

of project participants who are in 

unsubsidized employment during the 

second quarter after exit from the 

project.’’ This performance measure is 

defined by the following formula: For 

all participants who exited and are in 

unsubsidized employment during the 

second quarter after the exit quarter, the 

wage that is at the midpoint (of all the 

wages) between the highest and lowest 

wage earned in the second quarter after 

the exit quarter. This definition aligns 

with the definition of the corresponding 

WIOA performance measure, as 

explained in TEGL 10–16. 

The Department did not receive any 

comments relating to paragraph (d). The 

final rule adopts the provision as 

originally issued in the IFR. 

Effectiveness Measure 

The IFR added a definition in 

paragraph (e) for the fifth performance 

measure, ‘‘effectiveness in serving 

employers, host agencies, and project 

participants.’’ While this definition is 

similar to the definition used for this 

indicator under the 2006 OAA, when it 

was an additional indicator, the 2016 

OAA revised the definition so that it 

focuses more specifically on 

effectiveness rather than satisfaction in 

general. The Department received no 

comments in response to this definition. 

The final rule adopts the provision as 

originally issued in the IFR. 

Although the new SCSEP measure of 

effectiveness parallels the language of 

the WIOA measure, it differs because it 

also measures the effectiveness in 

serving participants and host agencies, 

as well as employers. The WIOA 

approach to the measure, which is being 

piloted until 2019, does not have 

obvious application to SCSEP’s other 

two customer groups. As a result, for the 

SCSEP measure, the Department has 

decided to continue surveying all three 

customer groups to assess the 

effectiveness of the services received as 

an interim measure at least until the 

WIOA pilot is complete and a WIOA 

measure is defined in final form. By 

using the same definition as that of the 

current customer satisfaction measure 

during this period, the Department will 

not require SCSEP customers to change 

their current practices or take on any 

additional burden. 

Other Changes 

To conform to the changes outlined 

above, the IFR renumbered former 

paragraph (a)(5) to (f). The IFR also 

renumbered former paragraph (a)(6)(i) 

through (xiii) to (g)(1) through (13). 

Renumbered paragraphs (f) and (g) 

correspond to the sixth and seventh 

SCSEP performance measures, the 

definitions of which were unchanged by 

the IFR. The Department received no 

comments in response to these technical 

changes and they are incorporated into 

this final rule without change. 

The 2016 OAA removed the 

additional indicators of performance 

previously established in sec. 513(b)(2) 

of the 2006 OAA. Therefore, the IFR 

deleted former paragraphs (b)(1) through 

(3) that contained definitions for the 

additional indicators. The Department 

received no comments in response to 

these deletions. 

In addition to the regulatory text 

changes discussed above, the IFR made 

various non-substantive changes to the 

regulations for purposes of correcting 

typographical errors and improving 

clarity. 

Section 641.720 How will the 

Department and grantees initially 

determine and then adjust expected 

levels of the core performance 

measures? 

The Department received several 

comments related to this provision. The 

comments are addressed below in the 

‘‘Employment Outcome Measure’’ 

heading. 

The IFR made substantial revisions to 

this section to align with the 2016 OAA, 

which in large part mirrors the process 

for establishing the expected 

performance levels required by WIOA 


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for the title I core programs, as 

implemented in 20 CFR 677.170. 

The IFR revised paragraph (a), which 

requires agreement between the grantee 

and the Department for expected levels 

of performance for the first 2 program 

years of the grant, to mirror the statutory 

language in 2016 OAA sec. 513(a)(2)(B) 

and (C)(i) and align with WIOA sec. 

116(b)(3)(A)(iv)(I). Specifically, 

paragraph (a) of the IFR stated that each 

grantee must reach agreement with the 

Department on levels of performance for 

each measure listed in § 641.700 for 

each of the first 2 program years covered 

by the grant agreement. In reaching the 

agreement, the grantee and the 

Department must take into account the 

expected levels of performance 

proposed by the grantee and the factors 

described in paragraph (c) of this 

section. This paragraph also stated that 

the levels agreed to will be considered 

to be the expected levels of performance 

for the grantee for such program years, 

and the Department may not award 

funds under the grant until such 

agreement is reached. Lastly, this 

paragraph stated that, at the conclusion 

of negotiations concerning the 

performance levels with all grantees, the 

Department would make available for 

public review the final negotiated 

expected levels of performance for each 

grantee, including any comments 

submitted by the grantee regarding the 

grantee’s satisfaction with the 

negotiated levels. 

The IFR explained that the 

Department considers PY 2016 and PY 

2017 to be the first 2 program years 

under the current SCSEP grants (i.e., the 

four-year grant cycle that began in PY 

2016). For national grantees, these were 

the first 2 program years following the 

last (PY 2016) grant competition. For 

State grantees, these were the first 2 

program years of the current (PY 2016) 

SCSEP State Plans. 

The IFR also revised paragraph (b), 

which required agreement for expected 

levels of performance for the third and 

fourth program years of the grant, to 

mirror the statutory language provided 

in 2016 OAA sec. 513(a)(2)(B) and (C)(ii) 

and to align with WIOA sec. 

116(b)(3)(A)(iv)(II). The IFR explained, 

in keeping with paragraph (a) above, 

that the Department considers PY 2018 

and PY 2019 to be the third and fourth 

program years of the current (PY 2016) 

SCSEP grant agreements. Specifically, 

paragraph (b) stated that each grantee 

must reach agreement with the 

Department, prior to the third program 

year covered by the grant agreement, on 

levels of performance for each measure 

listed in § 641.700, for each of the third 

and fourth program years of the grant. 

This paragraph stated that, in reaching 

the agreement, the grantee and the 

Department must take into account the 

expected levels proposed by the grantee 

and the factors described in paragraph 

(c) of this section. This paragraph also 

stated that the levels agreed to will be 

considered to be the expected levels of 

performance for the grantee for those 

program years. Lastly, like the 

requirement in paragraph (a), this 

paragraph stated that, at the conclusion 

of negotiations concerning the 

performance levels with all grantees, the 

Department would make available for 

public review the final negotiated 

expected levels of performance for each 

grantee, including any comments 

submitted by the grantee regarding the 

grantee’s satisfaction with the 

negotiated levels. 

The IFR added a new paragraph (c), 

‘‘Factors,’’ to require that the negotiated 

levels of performance must be based on 

the three factors listed in paragraphs 

(c)(1) through (3), as required by OAA 

sec. 513(a)(2)(D) and to align with 

WIOA sec. 116(b)(3)(A)(v). Paragraph 

(c)(1) of the IFR stated that the 

negotiated levels must take into account 

how a grantee’s levels of performance 

compare with the expected levels of 

performance established for other 

grantees. See OAA sec. 513(a)(2)(D)(i) 

and WIOA sec. 116(b)(3)(A)(v)(I). 

Paragraph (c)(2) stated that the 

negotiated levels must be adjusted using 

an objective statistical model based on 

the model established by the 

Department of Labor with the 

Department of Education in accordance 

with WIOA sec. 116(b)(3)(A)(viii) and 

implemented in § 677.170(c). See 29 

U.S.C. 3141(b)(3)(A)(viii), OAA sec. 

513(a)(2)(D)(ii), and WIOA sec. 

116(b)(3)(A)(v)(II). The IFR explained 

that the objective statistical adjustment 

model is to account for actual economic 

conditions and characteristics of 

participants, including the factors 

required by WIOA sec. 

116(b)(3)(A)(v)(II). Paragraph (c)(3) 

stated that the negotiated levels must 

take into account the extent to which 

the levels involved promote continuous 

improvement in performance 

accountability on the core measures and 

ensure optimal return on the investment 

of Federal funds. See OAA sec. 

513(a)(2)(D)(iii) and WIOA sec. 

116(b)(3)(A)(v)(III). The Department 

stated it would provide the model to 

grantees prior to the first negotiations 

under the new performance measures. 

The initial revision to the adjustment 

model was in fact presented to the 

grantees in a webinar held in May 2018, 

prior to the start of the negotiation 

period for PY 2018 and PY 2019. 

In paragraph (d), the IFR revised the 

adjustment requirements contained in 

former paragraph (b). The IFR replaced 

the adjustment factors specified in 

former (b)(1) through (3) with the 

requirement that the Department will, in 

accordance with the objective statistical 

model developed pursuant to paragraph 

(c)(2), adjust the expected levels of 

performance for a program year for 

grantees to reflect the actual economic 

conditions and characteristics of 

participants in the corresponding 

projects during such program year. The 

Department made these revisions in the 

IFR to align the pertinent regulations 

with OAA sec. 513(a)(2)(E). 

For consistency with the 2016 OAA, 

the IFR removed the language in 

paragraphs (a)(1) through (3) of 

§ 641.720 that describes the negotiation 

process in detail. However, as explained 

in the IFR, the negotiation process that 

the Department intends to use under 

these new performance measures is 

similar to the process that was used 

prior to the IFR, and includes similar 

opportunities for input from the 

grantees: 

• In the spring of 2018, the 

Department analyzed grantees’ baseline 

performance and issued proposed 

targets and goals for the next 2 program 

years, PY 2018 and PY 2019, based on 

the new adjustment factors. 

• If a grantee disagreed with those 

targets and goals, it was allowed to 

propose its own goals and request to 

negotiate. No grantee chose to negotiate 

revisions to the proposed targets and 

goals. 

• Prior to the negotiation, the grantee 

was required to provide the Department 

with the data on which the grantee 

based its proposed goals. 

• The grantee and the Department 

must reach agreement before funds for 

PY 2018 and PY 2019 can be approved; 

the agreed-upon goals will be the 

expected levels of performance upon 

which the annual evaluation of grantee 

performance will be based. If the grantee 

and the Department fail to reach 

agreement, no funds may be released. 

• At the conclusion of the 

negotiation, the grantee may submit 

comments regarding the grantee’s 

satisfaction with the negotiated levels of 

performance, which the Department 

will publish, along with the expected 

levels of performance. 

• At the time of the annual evaluation 

of grantee performance, the expected 

levels of performance will be adjusted a 

second time using the latest available 

adjustment data. The Department will 

base this evaluation on the newly 


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adjusted levels of performance. See 

preamble discussion of § 641.740. 

• The same process will be followed 

for subsequent 2-year periods. 

In addition to the regulatory text 

changes discussed above, the IFR made 

various non-substantive changes for 

purposes of correcting typographical 

errors and improving clarity. Those 

changes have been retained in this final 

rule. 

The new measures implemented by 

the IFR became effective on January 2, 

2018, and the new measures were used 

during the second half of PY 2017, to 

negotiate the targets and goals for PYs 

2018 and 2019. Performance under the 

PY 2018 targets and goals will begin to 

be reported starting July 1, 2018. The 

SCSEP QPR for PY 2017 will be based 

on the measures that were in place prior 

to the IFR, and the QPRs for PY 2018, 

will be based on the measures 

established in the IFR (and adopted 

without change in this final rule). 

SCSEP participants who exit during 

PY 2017 when goals based on the prior 

measures were still in effect will have 

their performance reported under the 

old measures for PY 2017. For this same 

cohort of exiters, reporting for the core 

employment outcome measures would 

also take place throughout PY 2018, 

under the new measures set forth in the 

IFR and adopted without change in this 

final rule, and would be reflected in the 

grantees’ PY 2018 QPRs. For example, a 

participant who exits in Quarter 3 of PY 

2017 will be included in the previous 

entered employment measure for 

Quarter 4 of PY 2017; the grantee will 

also report this participant in the final 

rule’s new measure of employment in 

the second quarter after exit in Quarter 

1 of PY 2018. Since the underlying data 

required for the new measures that will 

be reported in PY 2018 are the same 

data required for the prior measures, 

grantees will have to follow different 

timing rules for the collection of data in 

PY 2018, but they will not be required 

to collect any new or additional data 

beyond the data they would have 

reported under the old measures. The 

Department will provide technical 

assistance and guidance on the new 

timing and reporting requirements. As 

with the core measures in use prior to 

the IFR, the grantees will collect data for 

the additional measures not carried 

forward in the IFR and now this final 

rule throughout PY 2017, and the final 

QPR for PY 2017 will be the last report 

of the additional measures. 

Employment Outcome Measures 

The Department received several 

comments relating to § 641.720, which 

are summarized below. The Department 

considered all of these comments as it 

finalized the IFR; our responses to each 

comment are set forth below. This final 

rule, however, adopts this provision as 

it was issued in the IFR for reasons 

discussed below. 

A commenter asked for clarification of 

the calculation of two of the measures: 

Whether exclusions from exit will still 

be applied and whether the year-to-date 

measure for median earnings will be 

based on cumulative data or an average 

of the quarterly results. 

As the Department stated in the IFR, 

as part of its adoption of the WIA 

common measures in PY 2007, SCSEP 

has been following the WIA exclusions. 

With the 2016 OAA’s adoption of the 

measures consistent with the WIOA 

primary indicators of performance, 

SCSEP will examine the revised WIOA 

exclusions and will issue revised 

guidance as appropriate. The 

calculation of the year-to-date 

performance will continue to be based 

on cumulative data, as it has always 

been. The Department will issue 

guidance on the calculations and timing 

rules for all the new measures. 

One commenter expressed concern 

that while achieving unsubsidized 

employment is a key goal of the SCSEP 

program, in many States and localities 

there remains a significant gap between 

the unsubsidized income needed to 

make ends meet and the possible 

reduction of public benefits due to 

achieving employment; that pursuit of 

improved performance under the new 

employment outcome measures could 

result in worsening the quality of life of 

SCSEP participants rather than 

improving it; and that the Department 

should work with States to identify 

mechanisms to ensure that every 

participant’s life is improved by 

participation in the SCSEP program. 

The commenter recommended that the 

Department allow States to use 

additional economic factors such as 

housing availability and other issues 

related to affordability and cost of living 

as a part of their outcome measures. The 

commenter also recommended that the 

Department work with partners in the 

Federal Government to evaluate options 

for a gradual reduction in benefits for 

individuals as they leave SCSEP instead 

of the current benefits cliff. 

The Department agrees that SCSEP is 

designed to improve participants’ 

quality of life, including selfsufficiency. In fact, data from the 

participant customer satisfaction 

surveys consistently confirm that the 

program does effectively improve 

participants’ physical, emotional, and 

financial quality of life, and that 

participants who exit from the program 

are satisfied with SCSEP, even if they do 

not achieve unsubsidized employment. 

Section 641.535(a)(3)(iii) of the SCSEP 

regulations (a section not affected by the 

IFR or this final rule) recognizes that 

unsubsidized employment may not be 

an appropriate goal for all participants 

and that if it becomes apparent that 

unsubsidized employment is not 

feasible, the grantee must modify the 

participant’s IEP and assist the 

participant with other approaches to 

self-sufficiency, including transition to 

other services and programs. 

The Department notes also that the 

goals for the employment outcomes 

have always been set at a level that 

recognizes that not all participants will 

obtain unsubsidized employment and 

that because seniors generally work 

part-time hours at lower pay levels, the 

goals for earnings have also been set at 

realistic levels. However, the 

Department disagrees that SCSEP 

participants in general cannot improve 

their financial condition through 

unsubsidized employment. If grantees 

do their best to help participants find 

jobs at their highest wage and skill level, 

many participants can and do achieve 

economic self-sufficiency. 

Finally, the Department has no 

authority to revise the employment 

outcome measures required by the 2016 

OAA and implemented by the IFR and 

this final rule. The Department will 

work with other Federal agencies to 

explore whether Federal benefits can be 

reduced gradually when SCSEP 

participants exit the program for 

unsubsidized employment. The 

Department will also consider adding 

additional economic factors to the 

statistical adjustment model as 

suggested by this commenter and other 

commenters. See discussion of the 

statistical adjustment model below. 

Use of Unemployment Insurance Wage 

Records 

Citing the additional burden the new 

measures place on grantees to conduct 

follow-ups and the incompleteness and 

inaccuracy of case management followup, all four commenters urged the 

Department to allow the use of 

unemployment insurance wage records 

to obtain employment outcome data. 

One commenter also urged the 

Department to phase out case 

management follow-up once access to 

wage records is available. 

As the commenters recognized and as 

stated in the IFR, the Department is 

investigating access to wage records and 

hopes to implement aggregate wage 

record matching for all grantees. 

However, since wage matching does not 

provide data on all participants in 


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unsubsidized employment, some 

supplemental use of case management 

follow-up would still be required. In 

addition, the SCSEP program model 

requires that grantees remain in touch 

with participants and employers during 

the four quarters after exit in order to 

help resolve any problems that may 

arise and to provide supportive services 

needed to help participants obtain and 

retain unsubsidized employment. 

The Department will inform the 

grantees as soon as it ascertains when 

wage matching will be available to 

SCSEP and will consult with the 

grantees about the extent to which 

follow-up will still be required for both 

performance reporting and case 

management. In the meantime, as stated 

in the IFR, until the access to wage 

records occurs, all grantees must 

continue using case management 

follow-up. Using different methods of 

data collection would compromise the 

consistency of the performance 

measures and would potentially provide 

an unfair advantage to those grantees 

with access to wage records. In the 

meantime, the Department will review 

the standards for case management 

follow-up as set forth in various 

guidance materials, will confer with 

grantees about the changes in 

procedures desired, and will issue 

revised guidance if appropriate. 

Negotiation Process 

One commenter provided several 

comments relating to the negotiation 

process, including several concerns 

about the current process. The 

commenter described challenges that 

States have reported facing in 

negotiations on performance levels, 

including lack of interest from Federal 

partners, inconsistency regarding 

negotiations on a regional basis, delay 

resulting from confusion about what 

data to provide, and time pressures. The 

commenter requested that the 

Department issue guidance to States 

regarding the types of data the 

Department would take into account 

when negotiating performance levels. 

This commenter also requested that the 

Department work with other Federal 

agencies, including the Department of 

Health and Human Services and the 

Department of Agriculture, to provide 

guidance regarding data-sharing 

between programs such as SNAP, 

TANF, Unemployment Insurance, and 

the SCSEP program. Lastly, this 

commenter recommended that the 

Department allow for adjustments in the 

timeline for negotiations and allow for 

a certain percentage of funds to be 

released prior to agreement on the goals 

and/or to provide funds on an interim 

contingency basis while negotiations are 

ongoing. 

Although the OAA provides that 

grantees may comment on the 

negotiation process and that the 

Department will publish such 

comments, very few grantees have 

commented at all since PY 2007, and no 

grantees have expressed the concerns 

raised by the commenter. The 

Department notes that it has been 

providing annual teleconferences and 

webinars on the negotiation process 

each year since PY 2007, and that, 

during the negotiations themselves, the 

Department and its subject matter 

experts make every effort to identify and 

help grantees locate data that may be 

useful to them in their negotiations. The 

Department thus welcomes the 

commenter’s suggestions for improving 

the negotiation process and will take 

them under consideration to the extent 

it has the authority to do so. The 

Department agrees that all Federal 

regions should be engaged in the 

process and that grantees should be 

given the support they require to 

participate meaningfully. The 

Department will work with the Federal 

Project Officers to ensure that all 

grantees are aware of their right to 

negotiate their goals and have a full 

opportunity to do so. The Department 

will also ensure that grantees have 

information about relevant data sources. 

As the commenter recognized, 

however, the requirement to reach 

agreement on negotiated levels of 

performance before the Department may 

release grant funds is contained in the 

OAA. The Department has no authority 

to waive or modify that requirement. 

The Department recognizes that the time 

period for negotiation is condensed and 

that negotiations occur during the same 

time that grantees are preparing their 

annual grant applications. The need to 

obtain the most recent baseline data and 

economic information to use in the goal 

setting and adjustment process 

necessitates this timing. The 

Department shares the commenter’s 

desire to allow for a more relaxed 

schedule and will explore the 

possibility of using a more flexible 

baseline once the new performance 

measures have been in place long 

enough for a new baseline to emerge. 

Indicators of Effectiveness 

One commenter who addressed the 

new measure of effectiveness in serving 

SCSEP’s three customer groups pointed 

out that ‘‘effectiveness’’ is more difficult 

to measure than ‘‘satisfaction’’, which 

for this commenter is a more concrete 

measure. The commenter expressed 

uncertainty about how well the WIOA 

pilot project to explore measures of 

effectiveness will translate to SCSEP. 

This commenter expressed appreciation 

for the Department’s continuing to 

utilize the current customer satisfaction 

measure until a more detailed and 

rigorous effectiveness measure can be 

tested and developed. The commenter 

recommended that the Department 

create a stakeholder workgroup to 

collaborate on evaluating the 

applicability of the WIOA pilot 

measures to SCSEP, as well as on the 

modification or development of new 

measures of effectiveness. A different 

commenter made a similar 

recommendation about involving 

grantees in the exploration and adoption 

of pilot measures of effectiveness in 

serving employers. 

Another commenter asked whether 

there would be any changes in the 

administration, substance, or timeline 

for the customer satisfaction surveys 

during the interim period while the 

WIOA measure of effectiveness is not 

yet final. 

The Department welcomes the 

suggestions for grantee involvement and 

reiterates that it will continue to use the 

current customer satisfaction surveys at 

least until the WIOA pilot is complete 

and the new WIOA effectiveness 

measure is finalized. During this interim 

period, the Department will explore 

with grantees, and with its three 

customer groups, options for best 

measuring the effectiveness of SCSEP’s 

services, including the suggestions 

made by the commenters. The 

Department will also explore ways to 

improve the efficiency of the current 

customer surveys (including the use of 

online surveys and changes to the 

administration of the employer survey) 

and will examine what, if any, new or 

revised questions would support an 

index of effectiveness as an alternative 

to the current index of satisfaction. 

Until the Office of Management and 

Budget (OMB) approves any proposed 

changes to the content or methods of 

administration of the surveys, the 

currently approved surveys will 

continue to be administered as 

approved. 

Statistical Adjustment Model 

One commenter had several 

comments that relate to the statistical 

adjustment model, suggesting that the 

Department recognize differences 

between employment prospects for an 

individual residing in a metro or urban 

area versus one in a rural or frontier 

area, which would include allowing for 

different regional measures within the 

same State; the Department should 

consider other factors that influence 


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performance, such as access to 

affordable housing, transportation, and 

the interplay of various public benefits 

programs with one another; and 

whenever possible, the Department 

should use data on older workers in its 

calculations. This includes when 

determining local and regional 

employment and unemployment 

figures, among others. 

As the Department stated it would do 

in the preamble to the IFR, the 

Department is re-examining its current 

adjustment model to determine if 

additional aspects of the WIOA model 

should be incorporated into the SCSEP 

model or if other changes are 

appropriate. This consideration 

includes accounting for the percentage 

of participants who reside in rural areas, 

as well as examining an adjustment for 

the percentage of participants who are 

ex-offenders (as suggested by a comment 

made by SSAI). The Department will 

also explore whether it can obtain 

current economic data on the senior 

population as opposed to the general 

population. The adjustment model 

applied to the PY 2018 and PY 2019 

proposed targets and goals included five 

new participant characteristics 

(including residing in a rural area) and 

one new economic factor (average 

weekly wages). 

The Department notes that to the 

greatest extent possible, it uses countylevel data in its adjustment model, 

thereby permitting the adjustment 

factors to be tailored to the specific 

service area of each grantee. This 

approach accounts for regional 

differences within each grantee’s service 

area, as requested by the commenter. In 

applying the revised adjustment model, 

the Department used economic data for 

the new service areas in which the 

grantees were located at the time of the 

goal setting for PY 2018 and PY 2019. 

See also discussion of baseline in 

§ 641.730. 

Section 641.730 How will the 

Department assist grantees in the 

transition to the new core performance 

measures? 

Although the Department received a 

few public comments relating to this 

provision, which are discussed below, 

the final rule adopts this provision as it 

was issued in the IFR. 

The IFR made several changes in this 

section to update the Department’s 

transition assistance plans to 

correspond with the 2016 OAA. As a 

non-substantive change, the IFR deleted 

the designation of paragraph (a) and its 

title ‘‘General transition provision,’’ 

because the IFR deleted paragraph (b), 

as discussed below. This section was, 

thus, left with only two sentences. 

The first sentence as revised by the 

IFR stated that, as soon as practicable 

after January 2, 2018, the Department 

would determine whether a SCSEP 

grantee’s performance under the 

measures in effect prior to January 2, 

2018, would have met the expected 

levels of performance for PY 2018. The 

second sentence as revised by the IFR 

stated that if the Department determines 

that a grantee would have failed to meet 

those expected levels of performance, 

then the Department would provide 

technical assistance to help the grantee 

to eventually meet the expected levels 

of performance under the measures in 

§ 641.700, as those measures were 

revised by the IFR. 

The IFR explained that the 

Department would only make the above 

determination for the three new 

employment outcome measures, defined 

in § 641.710(b) through (d) of the IFR, 

since no transition is required for the 

remaining four core measures (three are 

unchanged, and for the fourth, the 

‘‘indicators of effectiveness in serving 

employers, host agencies, and 

participants,’’ the IFR stated that the 

Department would use the same 

customer satisfaction measure that was 

used prior to the IFR). In making the 

determination, the IFR indicated that 

the Department intended to examine all 

relevant data, as feasible, in order to 

provide a crosswalk between the 

existing measures and the measures 

implemented in the IFR and to develop 

a new baseline from which to begin the 

development of goals for PY 2018 and 

PY 2019. The IFR promised to provide 

the analysis to all grantees when it was 

completed. As set forth above, the 

Department completed the analysis and 

cross-walk and provided it to the 

grantees prior to the development of 

proposed targets and goals for PY 2018 

and PY 2019. 

As noted above, the IFR removed 

paragraph (b) from § 641.730, which 

provided that PY 2007 would be treated 

as a baseline year for the most-in-need 

indicator so that grantees and the 

Department may collect sufficient data 

to set a meaningful goal for the measure 

for PY 2008. The IFR explained that 

since this provision included dates that 

have already passed, and given that the 

Department has documented 

information on this measure, this 

provision is no longer required. 

Therefore, the IFR deleted it from this 

section. 

Baseline Year for New Employment 

Outcome Measures 

Some comments from some of the 

organizations that responded to the IFR, 

like comments received from the 

stakeholder webinar, expressed concern 

that the new employment outcome 

measures are substantially different 

from the current SCSEP outcome 

measures and that there is no baseline 

upon which goals for the new measures 

can be set. For this reason, some 

comments suggested that the 

Department establish a pilot period for 

the new employment measures during 

which there would not be any expected 

levels of performance. 

One commenter noted that, as a result 

of the 2016 national grantee 

competition, many national grantees 

operate in service areas different from 

their prior service areas and that the 

economic conditions in the new area are 

different as well. This commenter urged 

the Department to use a valid baseline 

rather than old data in establishing goals 

for the new measures. 

The Department recognizes that all 

three of the new outcome measures use 

different calculations from the measures 

that were in place prior to the IFR, and 

that it will take time to establish a 

reliable baseline to use in setting goals 

for these measures. As stated in the 

preamble to the IFR, to help determine 

how performance under the prior 

measures relates to performance under 

the new measures, the Department 

reanalyzed prior grantee performance 

data reported under the prior measures 

using the calculations required for the 

new measures and created a crosswalk 

between the two sets of measures. 

Because the recalculation proved to be 

an inadequate basis for setting the PY 

2018 and PY 2019 grantee-expected 

levels of performance, the Department 

decided to treat PYs 2018 and 2019 as 

baseline years for which targets, rather 

than expected levels of performance, are 

assigned, and has reserved the right to 

renegotiate the PY 2019 targets based on 

actual performance in PY 2018. 

Moreover, in developing the proposed 

goals, the Department used the grantees’ 

most recent, reliable baseline 

performance. Where the recent baseline 

data were not reliable, the Department 

used a longer, historical baseline. 

Use of the Participant Individual Record 

Layout (PIRL) and New Case 

Management System 

One commenter requested that the 

Department offer training on using the 

PIRL system and raised several 

questions related to the transition from 

SPARQ to PIRL, including whether 


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SPARQ data will migrate to PIRL and 

whether grantees should anticipate a 

period of dual entry into both systems. 

The comment further asked that the 

Department align its technical 

documentation with the PIRL data field 

specifications so that grantees may 

adjust their internal systems to support 

the new information codes and that the 

Department provide advanced notice of 

the new requirements and training on 

the new system. 

The Department has announced that it 

is developing a new case management 

system that is designed to replace 

SPARQ in whole or in part. The 

Department anticipates that SPARQ data 

will be migrated to the new system and 

that grantees will continue to use 

SPARQ for exited case records until the 

conclusion of the reporting of the PY 

2017 performance data on or around 

September 30, 2018. Since grantees will 

report the new performance measures 

beginning July 1, 2018, SPARQ is being 

reconfigured to support the new 

measures; grantees will continue using 

SPARQ for at least the first quarter of PY 

2018. The Department anticipates that 

grantees will begin using the new 

system for active cases in the second or 

third quarter of PY 2018. The 

Department has aligned SPARQ data 

collection for the case management 

system with the PIRL. The Department 

will provide details of the new case 

management system and the transition 

requirements to the grantees as soon as 

possible and does anticipate providing 

training to grantees. 

Section 641.740 How will the 

Department determine whether a 

grantee fails, meets, or exceeds the 

expected levels of performance and 

what will be the consequences of failing 

to meet expected levels of performance? 

The Department did not receive any 

comments on this section. The final rule 

adopts the provision as it was issued in 

the IFR. 

Section 641.750 Will there be 

performance-related incentives? 

The Department did not receive any 

comments on this section. The final rule 

adopts the provision as it was issued in 

the IFR. 

IV. Regulatory Flexibility Analysis, 

Executive Order 13272, Small Business 

Regulatory Enforcement Fairness Act 

The Regulatory Flexibility Act (RFA), 

5 U.S.C. 601 et seq., requires the 

Department to evaluate the economic 

impact of this rule with regard to small 

entities. The RFA defines small entities 

to include small businesses, small 

organizations including not-for-profit 

organizations, and small governmental 

jurisdictions. The Department must 

determine whether the rule imposes a 

significant economic impact on a 

substantial number of such small 

entities. 

There are 75 SCSEP grantees; 50 of 

these are States and are not small 

entities as defined by the RFA. Six 

grantees are governmental jurisdictions 

other than States (four grantees are 

territories such as Guam; one grantee is 

Washington, DC; and another grantee is 

Puerto Rico). Governmental 

jurisdictions must have a population of 

less than 50,000 to qualify as a small 

entity for RFA purposes and the 

population of these 6 SCSEP grantees 

each exceeds 50,000. The remaining 19 

grantees are non-profit organizations, 

which includes some large, national 

non-profit organizations. 

The Department has determined that 

this final rule will impose no additional 

burden on small entities affected. Since 

the alignment with WIOA involved only 

definitions, the grantees are not required 

to collect any additional information 

that may cause a burden increase. In 

addition, the SCSEP program funds 

provided to grantees cover all such 

costs. 

The Departments certifies that this 

final rule does not impose a significant 

economic impact on a substantial 

number of small entities. 

V. Other Regulatory Considerations 

Executive Order 12866 

Under Executive Order (E.O.) 12866, 

OMB’s Office of Information and 

Regulatory Affairs determines whether a 

regulatory action is significant and, 

therefore, subject to the requirements of 

the Executive Order and review by 

OMB. 58 FR 51735 (Oct. 4, 1993). 

Section 3(f) of E.O. 12866 defines a 

‘‘significant regulatory action’’ as an 

action that is likely to result in a rule 

that: (1) Has an annual effect on the 

economy of $100 million or more, or 

adversely affects in a material way a 

sector of the economy, productivity, 

competition, jobs, the environment, 

public health or safety, or State, local or 

tribal governments or communities (also 

referred to as economically significant); 

(2) creates serious inconsistency or 

otherwise interferes with an action 

taken or planned by another agency; (3) 

materially alters the budgetary impacts 

of entitlement grants, user fees, or loan 

programs, or the rights and obligations 

of recipients thereof; or (4) raises novel 

legal or policy issues arising out of legal 

mandates, the President’s priorities, or 

the principles set forth in the Executive 

Order. Id. OMB has determined that this 

final rule is not a ‘‘significant regulatory 

action’’ under sec. 3(f) of E.O. 12866. 

This rule is not an E.O. 13771 

regulatory action because this rule is not 

significant under E.O. 12866. 

E.O. 13563 directs agencies to propose 

or adopt a regulation only upon a 

reasoned determination that its benefits 

justify its costs; it is tailored to impose 

the least burden on society, consistent 

with achieving the regulatory objectives; 

and in choosing among alternative 

regulatory approaches, the agency has 

selected those approaches that 

maximize net benefits. E.O. 13563 

recognizes that some benefits are 

difficult to quantify and provides that, 

where appropriate and permitted by 

law, agencies may consider and discuss 

qualitatively values that are difficult or 

impossible to quantify, including 

equity, human dignity, fairness, and 

distributive impacts. 

OMB declined review of this final 

rule because it is not a significant 

regulatory action. 

Paperwork Reduction Act 

The purposes of the Paperwork 

Reduction Act of 1995 (PRA), 44 U.S.C. 

3501 et seq., include minimizing the 

paperwork burden on affected entities. 

A Federal agency may not conduct or 

sponsor a collection of information 

unless OMB approves it under the PRA 

and it displays a currently valid OMB 

control number. The public is also not 

required to respond to a collection of 

information unless it displays a 

currently valid OMB control number. In 

addition, notwithstanding any other 

provisions of law, no person will be 

subject to penalty for failing to comply 

with a collection of information if the 

collection of information does not 

display a currently valid OMB control 

number (44 U.S.C. 3512). OMB has 

approved the information collections 

contained in this final rule. See ICR 

Reference Number 201802–1205–003. 

The information collection is 

summarized as follows. 

DOL-Only Performance Accountability, 

Information, and Reporting System 

Agency: DOL–ETA. 

Title of Collection: DOL-Only 

Performance Accountability, 

Information, and Reporting System. 

Type of Review: Revision. 

OMB Control Number: 1205–0521. 

Affected Public: State, Local, and 

Tribal Governments; Individuals or 

Households; and Private Sector— 

businesses or other for-profits and notfor-profit institutions. 

Obligation to Respond: Required to 

Obtain or Retain Benefits. 


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36416 Federal Register / Vol. 83, No. 146 / Monday, July 30, 2018 / Rules and Regulations 

Estimated Total Annual Respondents: 

17,532,542. 

Estimated Total Annual Responses: 

35,064,970. 

Estimated Total Annual Burden 

Hours: 8,938,029. 

Estimated Total Annual Other Burden 

Costs: $6,791,395. 

Regulations sections: § 684.420, 

§ 684.610, § 684.700, § 684.800, 

§ 685.210, § 685.400, § 688.420, 

§ 688.610. § 641.700, § 641.710, 

§ 641.720, § 641.730, § 641.740, 

§ 641.750. 

Unfunded Mandates Reform Act 

For purposes of the Unfunded 

Mandates Reform Act of 1995, this rule 

does not include any Federal mandate 

that may result in increased 

expenditures by State, local, and tribal 

governments in the aggregate of more 

than $100 million, or increased 

expenditures by the private sector of 

more than $100 million. 

Executive Order 13132 

The Department has reviewed this 

rule in accordance with E.O. 13132 

regarding federalism and has 

determined that it does not have 

‘‘federalism implications.’’ The rule 

does not ‘‘have substantial direct effects 

on the States, on the relationship 

between the national government and 

the States, or on the distribution of 

power and responsibilities among the 

various levels of government.’’ This 

final rule defines and implements 

performance measures for the SCSEP 

and while States are SCSEP grantees, 

this rule merely makes changes to data 

collection processes that are ongoing. 

Requiring State grantees to implement 

these changes does not constitute a 

‘‘substantial direct effect’’ on the States, 

nor will it alter the relationship or 

responsibilities between the Federal and 

State governments. 

Executive Order 13045 

E.O. 13045 concerns the protection of 

children from environmental health 

risks and safety risks. This rule defines 

and details the performance measures 

used by the SCSEP, a program for older 

Americans, and has no impact on safety 

or health risks to children. 

Executive Order 13175 

E.O. 13175 addresses the unique 

relationship between the Federal 

Government and Indian tribal 

governments. The order requires Federal 

agencies to take certain actions when 

regulations have ‘‘tribal implications.’’ 

Required actions include consulting 

with Tribal Governments prior to 

promulgating a regulation with tribal 

implications and preparing a tribal 

impact statement. The order defines 

regulations as having ‘‘tribal 

implications’’ when they have 

substantial direct effects on one or more 

Indian tribes, on the relationship 

between the Federal Government and 

Indian tribes, or on the distribution of 

power and responsibilities between the 

Federal Government and Indian tribes. 

The Department has reviewed this 

final rule and concludes that it does not 

have tribal implications. While some 

tribes may be recipients of national 

SCSEP grantees, this rule will not have 

a substantial direct effect on those tribes 

because, as outlined in the RFA section 

of the preamble above, there are only 

small cost increases associated with 

implementing this regulation. This 

regulation does not affect the 

relationship between the Federal 

Government and the tribes, nor does it 

affect the distribution of power and 

responsibilities between the Federal 

Government and Tribal Governments. 

Accordingly, we conclude that this rule 

does not have tribal implications for the 

purposes of E.O. 13175. 

Environmental Impact Assessment 

The Department has reviewed this 

rule in accordance with the 

requirements of the National 

Environmental Policy Act of 1969 

(NEPA) (42 U.S.C. 4321 et seq.), the 

regulations of the Council on 

Environmental Quality (40 CFR part 

1500), and the Department’s NEPA 

procedures (29 CFR part 11). The rule 

will not have a significant impact on the 

quality of the human environment and, 

thus, the Department has not prepared 

an environmental assessment or an 

environmental impact statement. 

Assessment of Federal Regulations and 

Policies on Families 

Section 654 of the Treasury and 

General Government Appropriations 

Act, enacted as part of the Omnibus 

Consolidated and Emergency 

Supplemental Appropriations Act of 

1999 (Pub. L. 105–277, 112 Stat. 2681), 

requires the Department to assess the 

impact of this rule on family well-being. 

A rule that is determined to have a 

negative effect on families must be 

supported with an adequate rationale. 

The Department has assessed this rule 

and determines that it will not have a 

negative effect on families. Indeed, the 

SCSEP strengthens families by 

providing job training and support 

services to low-income older Americans 

so that they can obtain fruitful 

employment and enjoy increased 

economic self-sufficiency. 

Privacy Act 

The Privacy Act of 1974, 5 U.S.C. 

552a, provides safeguards to individuals 

concerning their personal information 

that the Government collects. The Act 

requires certain actions by an agency 

that collects information on individuals 

when that information contains 

personally identifiable information such 

as Social Security Numbers (SSNs) or 

names. Because SCSEP participant 

records are maintained by SSN, the Act 

applies here. 

A key concern is for the protection of 

participant SSNs. Grantees must collect 

the SSN in order to pay participants 

properly for their community service 

work in host agencies. When grantees 

send participant files to the Department 

for aggregation, the transmittal is 

protected by secure encryption. When 

participant files are retrieved within the 

internet-based SCSEP data management 

system of SPARQ, only the last four 

digits of the SSN are displayed. Any 

information that is shared or made 

public is aggregated by grantee and does 

not reveal personal information on 

specific individuals. 

The Department works diligently to 

ensure the highest level of security 

whenever personally identifiable 

information is stored or transmitted. All 

contractors that have access to 

individually identifying information are 

required to provide assurances that they 

will respect and protect the 

confidentiality of the data. ETA’s Office 

of Performance and Technology has 

been an active participant in the 

development and approval of data 

security measures—especially as they 

apply to SPARQ. 

In addition to the above, the 

Department provides a Privacy Act 

Statement to grantees for distribution to 

all participants. The Department 

advised grantees of the requirement in 

ETA’s Older Worker Bulletin OWB–04– 

06. Participants receive this information 

when they meet with a caseworker or 

intake counselor. When the Department 

monitors the programs, implementation 

of this term is included in the review. 

Executive Order 12630 

This rule is not subject to E.O. 12630, 

Governmental Actions and Interference 

with Constitutionally Protected Property 

Rights, because it does not involve 

implementation of a policy with takings 

implications. 

Executive Order 12988 

This regulation has been drafted and 

reviewed in accordance with E.O. 

12988, Civil Justice Reform, and will not 

unduly burden the Federal court 


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Federal Register / Vol. 83, No. 146 / Monday, July 30, 2018 / Rules and Regulations 36417 

system. The Department has written the 

regulation so as to minimize litigation 

and provide a clear legal standard for 

affected conduct, and the Department 

has reviewed the regulation carefully to 

eliminate drafting errors and 

ambiguities. 

Executive Order 13211 

This rule is not subject to E.O. 13211, 

because it will not have a significant 

adverse effect on the supply, 

distribution, or use of energy. 

Plain Language 

The Department drafted this IFR in 

plain language. 

List of Subjects in 20 CFR Part 641 

Aged, Employment, Government 

contracts, Grant programs-labor, 

Privacy, Reporting and recordkeeping 

requirements. 

■ Accordingly, the IFR amending 20 

CFR part 641 which was published at 82 

FR 56869 on December 1, 2017, is 

adopted as final without change. 

Rosemary Lahasky, 

Deputy Assistant Secretary for Employment 

and Training, Labor. 

[FR Doc. 2018–16216 Filed 7–27–18; 8:45 am] 

BILLING CODE 4510–FN–P 

DEPARTMENT OF THE TREASURY 

Internal Revenue Service 

26 CFR Parts 1 and 602 

[TD 9836] 

RIN 1545–BH62 

Substantiation and Reporting 

Requirements for Cash and Noncash 

Charitable Contribution Deductions 

AGENCY: Internal Revenue Service (IRS), 

Treasury. 

ACTION: Final regulations. 

SUMMARY: These final regulations 

provide guidance concerning 

substantiation and reporting 

requirements for cash and noncash 

charitable contributions. The final 

regulations reflect the enactment of 

provisions of the American Jobs 

Creation Act of 2004 and the Pension 

Protection Act of 2006. These 

regulations provide guidance to 

individuals, partnerships, and 

corporations that make charitable 

contributions. 

DATES: Effective date: These regulations 

are effective on July 30, 2018. 

Applicability dates: For dates of 

applicability, see §§ 1.170A–1(k), 

1.170A–14(j), 1.170A–15(h), 1.170A– 

16(g), 1.170A–17(c), 1.170A–18(d), 

1.664–1(f), and 1.6050L–1(h). 

FOR FURTHER INFORMATION CONTACT: 

Charles Gorham at (202) 317–7003 (not 

a toll-free number). 

SUPPLEMENTARY INFORMATION: 

Paperwork Reduction Act 

The collections of information 

contained in these final regulations have 

been reviewed and approved by the 

Office of Management and Budget in 

accordance with the Paperwork 

Reduction Act of 1995 (44 U.S.C. 

3507(d)) under control number 1545– 

1953. 

The collections of information in 

these final regulations are in §§ 1.170A– 

15(a) and (d)(1); 1.170A–16(a), (b), (c), 

(d), (e), and (f); and 1.170A–18(a)(2) and 

(b). These collections of information are 

required to obtain a benefit and will 

enable the IRS to determine if a taxpayer 

is entitled to a claimed deduction for a 

charitable contribution. 

An agency may not conduct or 

sponsor, and a person is not required to 

respond to, a collection of information 

unless it displays a valid control 

number. 

Books or records relating to a 

collection of information must be 

retained as long as their contents may 

become material in the administration 

of any internal revenue law. Generally, 

tax returns and return information are 

confidential, as required by section 

6103. 

Background 

This document contains amendments 

to the Income Tax Regulations, 26 CFR 

parts 1 and 602, relating to 

substantiating and reporting deductions 

for charitable contributions under 

section 170 of the Internal Revenue 

Code. These final regulations reflect 

amendments to section 170 made by 

section 883 of the American Jobs 

Creation Act of 2004, Public Law 108– 

357 (118 Stat. 1418, 1631) (Jobs Act), 

and sections 1216, 1217, and 1219 of the 

Pension Protection Act of 2006, Public 

Law 109–280 (120 Stat. 780, 1079–83) 

(PPA), which added new rules for 

substantiating charitable contributions. 

The final regulations also update crossreferences to the section 170 regulations 

in other regulations. 

Section 170(f)(8), which has been in 

the Code since 1993, provides that no 

deduction shall be allowed for any 

contribution of $250 or more, cash or 

noncash, unless the taxpayer 

substantiates the contribution with a 

contemporaneous written 

acknowledgment of the contribution by 

the donee organization. The 

contemporaneous written 

acknowledgment must include: (1) The 

amount of cash and a description (but 

not value) of any property other than 

cash contributed; (2) a statement of 

whether the donee organization 

provided any goods or services in 

consideration, in whole or in part, for 

any such cash or property; and (3) a 

description and good faith estimate of 

the value of any such goods or services 

or, if such goods or services consist 

solely of intangible religious benefits, a 

statement to that effect. 

Section 170(f)(11), as added by 

section 883 of the Jobs Act, restates, in 

part, section 155(a) of the Deficit 

Reduction Act of 1984 and contains 

reporting and substantiation 

requirements relating to the allowance 

of deductions for noncash charitable 

contributions. Under section 

170(f)(11)(C), taxpayers are required to 

obtain a qualified appraisal for donated 

property for which a deduction of more 

than $5,000 is claimed. 

Under section 170(f)(11)(D), a 

qualified appraisal must be attached to 

any tax return claiming a deduction of 

more than $500,000. Section 

170(h)(4)(B), as added by section 1213 

of the PPA, adds the requirement that a 

qualified appraisal must be included 

with the taxpayer’s return for the 

taxable year of the contribution for any 

contribution of a qualified real property 

interest that is a restriction as to the 

exterior of a building described in 

section 170(h)(4)(C)(ii). 

Section 170(f)(11)(E), as amended by 

section 1219 of the PPA, provides 

statutory definitions of qualified 

appraisal and qualified appraiser for 

appraisals prepared with respect to 

returns filed after August 17, 2006. 

Section 170(f)(11)(E)(i) provides that 

the term qualified appraisal means an 

appraisal that is (1) treated as a qualified 

appraisal under regulations or other 

guidance prescribed by the Secretary, 

and (2) conducted by a qualified 

appraiser in accordance with generally 

accepted appraisal standards and any 

regulations or other guidance prescribed 

by the Secretary. 

Section 170(f)(11)(E)(ii) provides that 

the term qualified appraiser means an 

individual who (1) has earned an 

appraisal designation from a recognized 

professional appraiser organization or 

has otherwise met minimum education 

and experience requirements set forth in 

regulations prescribed by the Secretary, 

(2) regularly performs appraisals for 

which the individual receives 

compensation, and (3) meets such other 

requirements as may be prescribed by 

the Secretary in regulations or other 


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